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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 811-05646
------------------------------------
New Century Portfolios
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
40 William Street, Suite 100 Wellesley, Massachusetts 02481
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Nicole M. Tremblay, Esq.
Weston Financial Group, Inc. 40 William Street Wellesley, Massachusetts 02481
- --------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (781) 235-7055
---------------------------
Date of fiscal year end: October 31, 2005
-----------------------------------
Date of reporting period: April 30, 2005
-----------------------------------
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
================================================================================
[GRAPHIC OMITTED]
NEW CENTURY
PORTFOLIOS
NEW CENTURY CAPITAL
NEW CENTURY BALANCED
NEW CENTURY AGGRESSIVE
NEW CENTURY INTERNATIONAL
NEW CENTURY ALTERNATIVE STRATEGIES
SEMI-ANNUAL REPORT
SIX MONTHS ENDED APRIL 30, 2005
(UNAUDITED)
40 William Street, Suite 100, Wellesley MA 02481 781-239-0445 888-639-0102 Fax 781-237-1635
================================================================================
CONTENTS
- --------------------------------------------------------------------------------
PRESIDENT'S LETTER 1
PORTFOLIO INFORMATION 2-6
New Century Portfolios
Statements of Assets and Liabilities 7
Statements of Operations 8
Statements of Changes in Net Assets 9-11
Financial Highlights 12-16
Portfolios of Investments 17-24
Notes to Financial Statements 25-31
About Your Portfolio's Expenses 32-34
LETTER TO SHAREHOLDERS
================================================================================
Dear Fellow Shareholders:
I am pleased to present our Semi-Annual Report for the six-month period ended
April 30, 2005. This Report presents important financial information for each of
the New Century Portfolios. I also invite you to visit our website at
www.newcenturyportfolios.com for additional information.
The Federal Reserve's policy of increasing short-term interest rates, the
specter of inflation, a frothy real estate market, lofty consumer debt levels,
the weak U.S. dollar and volatile energy prices generated an anxious investment
environment.
Nonetheless, during the six-month period ended April 30, 2005, the S&P 500
gained approximately 3.3%, the Russell 3000 Index gained 3.7%, the MSCI EAFE
Index gained 8.7% and the Lehman Brothers Intermediate Government/Credit Index
gained 0.05%.
During the period, the New Century Capital Portfolio increased its exposure to
the growth and the international sectors, while reducing its position in the
aggressive sector. During the period, the Capital Portfolio gained 2.8%.
The New Century Balanced Portfolio increased its allocation to the growth and
income sector and the international sector, and reduced its allocation in the
growth sector. Its overall allocation between equities and fixed income remained
constant. During the period, the New Century Balanced Portfolio gained 2.7%, as
compared to a blended index of 60% S&P 500 Composite Index and 40% Lehman
Brothers Intermediate Government/Credit Index which gained 2.3%.
The energy, natural resources, and emerging markets sectors continued to post
strong results during the period. Positions in these sectors helped the New
Century Aggressive Portfolio gain of 4.9% during the period.
The New Century International Portfolio increased its positions in the
Asia/Pacific the emerging markets sectors, while reducing positions in the
diversified sector. During the period, the New Century International Portfolio
gained 10.1%. The international equity markets, as measured by the MSCI EAFE
Index, increased 8.7%.
The New Century Alternative Strategies Portfolio increased its allocation in the
natural resources, asset allocation and long/short equity categories and
decreased its allocation to the real estate investment trusts and the
convertible arbitrage category. The New Century Alternative Strategies Portfolio
maintained diversified positions in eleven investment strategies. Further, the
New Century Alternative Strategies Portfolio gained 3.1% during the period, as
compared to the Lehman Brothers Intermediate Government/Credit Index, which
gained 0.05% and the S&P 500 Composite Index gained 3.3%.
While future performance is always unpredictable, we are confident that New
Century's investment philosophy - diversification, risk assessment and long-term
focus - will maximize risk-adjusted returns.
New Century is committed to its shareholders and appreciates your selecting New
Century as part of your long-term investment strategy.
Sincerely,
/S/Wayne M. Grzecki
Wayne M. Grzecki
President
1
NEW CENTURY CAPITAL PORTFOLIO
PORTFOLIO INFORMATION
APRIL 30, 2005 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% of Net Assets)
- --------------------------------------------------------------------------------
Growth and Income Funds - 35.3%
Growth Funds - 33.3%
[GRAPHIC OMITTED] Small Company Funds - 17.5%
Foreign Stock Funds - 13.3%
Cash Equivalents - 0.6%
TOP TEN HOLDINGS
================================================================================
SECURITY DESCRIPTION % OF NET ASSETS
---------------------------------------- ---------------
Hotchkis & Wiley Large Cap Value - Class A 8.1%
iShares Dow Jones Select Dividend Index 7.9%
American Growth Fund of America - Class A 6.6%
Calamos Growth - Class A 6.4%
William Blair Small Cap Growth - Class I 6.3%
Marsico 21st Century 5.9%
Fidelity Capital Appreciation 5.4%
Royce Opportunity - Investor Class 4.7%
iShares S&P MidCap 400/BARRA Value Index 4.3%
Goldman Sachs Growth Opportunities - Class A 4.1%
See accompanying notes to financial statements.
2
NEW CENTURY BALANCED PORTFOLIO
PORTFOLIO INFORMATION
APRIL 30, 2005 (UNAUDITED)
ASSET ALLOCATION (% of Net Assets)
- --------------------------------------------------------------------------------
Growth and Income Funds - 33.0%
High Yield Bond Funds - 12.4%
Growth Funds - 11.8%
Small Company Funds - 10.3%
Foreign Stock Funds - 8.9%
[GRAPHIC OMITTED] Convertible Security Funds - 5.1%
Corporate Bond Funds - 5.0%
Government Bond Funds - 4.3%
Worldwide Bond Funds - 3.5%
High Quality Bond Funds - 3.1%
Emerging Markets Funds - 0.7%
Cash Equivalents - 1.9%
TOP TEN HOLDINGS
- --------------------------------------------------------------------------------
SECURITY DESCRIPTION % OF NET ASSETS
---------------------------------------- ---------------
Hotchkis & Wiley Large Cap Value - Class A 7.9%
iShares Dow Jones Select Dividend Index 7.3%
iShares S&P 500 Index 7.2%
MainStay High Yield Corporate Bond - Class A 6.2%
Fidelity Advisor High Income Advantage - Class I 6.2%
Loomis Sayles Bond - Institutional Class 5.0%
Dodge & Cox Stock 4.6%
American Century Target Maturities Trust
Series 2015 - Investor Class 4.3%
iShares MSCI EAFE Index 4.1%
American FundsAMCAP - Class A 3.8%
See accompanying notes to financial statements.
3
NEW CENTURY AGGRESSIVE PORTFOLIO
PORTFOLIO INFORMATION
APRIL 30, 2005 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% of Net Assets)
- --------------------------------------------------------------------------------
Sector Funds - 64.6%
Mid-Cap Funds - 20.6%
[GRAPHIC OMITTED] Small-cap Funds - 8.8%
Large-Cap Funds - 5.4%
Cash Equivalents - 0.6%
TOP TEN HOLDINGS
- --------------------------------------------------------------------------------
SECURITY DESCRIPTION % OF NET ASSETS
---------------------------------------- ---------------
iShares Dow Jones U.S. Energy Sector Index 17.9%
iShares Goldman Sachs Natural Resources Index 11.2%
iShares MSCI Emerging Markets Index 11.0%
Technology Select Sector SPDR 9.6%
S&P MidCap 400 Depositary Receipts 8.8%
Calamos Growth - Class A 8.3%
Fidelity Capital Appreciation 5.4%
iShares Goldman Sachs Networking Index 5.1%
Buffalo Small Cap 4.9%
Fidelity Select Medical Delivery 4.4%
See accompanying notes to financial statements.
4
NEW CENTURY INTERNATIONAL PORTFOLIO
PORTFOLIO INFORMATION
APRIL 30, 2005 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% of Net Assets)
- --------------------------------------------------------------------------------
Europe Funds - 28.8%
Diversified Funds - 23.8%
[GRAPHIC OMITTED] Asia/Pacific Funds - 21.2%
Americas Funds - 14.5%
Emerging Markets Funds - 10.6%
Cash Equivalents - 1.1%
TOP TEN HOLDINGS
- --------------------------------------------------------------------------------
SECURITY DESCRIPTION % OF NET ASSETS
---------------------------------------- ---------------
iShares MSCI Austria Index 7.3%
Dodge & Cox International Stock 6.9%
Ivy European Opportunities - Class A 6.5%
Tocqueville International Value (The) 6.1%
iShares S&P Latin American 40 Index 5.9%
T. Rowe Price Emerging Europe & Mediterranean 5.2%
Lazard International Small Cap - Investor Shares 5.1%
iShares MSCI Australia Index 4.9%
iShares MSCI Germany Index 4.9%
iShares MSCI EAFE Index 4.7%
See accompanying notes to financial statements.
5
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO
PORTFOLIO INFORMATION
APRIL 30, 2005 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% of Net Assets)
- --------------------------------------------------------------------------------
Merger Arbitrage Funds - 15.7%
Long/Short Equity Funds - 13.0%
Global Macro Funds - 12.7%
Asset Allocation Funds - 12.6%
Natural Resources Funds - 9.3%
High Yield Funds - 7.7%
[GRAPHIC OMITTED] Real Estate Funds - 7.1%
Deep Value/Distressed Securities Funds - 6.0%
Options/Hedged Funds - 5.4%
Convertible Arbitrage Funds - 4.9%
Market Neutral Funds - 3.2%
Common Stocks - 0.2%
Cash Equivalents - 2.2%
TOP TEN HOLDINGS
- --------------------------------------------------------------------------------
SECURITY DESCRIPTION % OF NET ASSETS
---------------------------------------- ---------------
First Eagle Global - Class A 7.2%
Merger Fund (The) 5.8%
Gateway 5.4%
Hussman Strategic Growth 5.0%
Enterprise Mergers and Acquisitions - Class A 5.0%
Calamos Market Neutral - A Shares 5.0%
PIMCO Commodity Real Return Strategy - Class A 3.9%
Arbitrage Fund (The) - Class R 3.7%
Third Avenue Real Estate Value 3.3%
FPA Crescent - Class I 3.2%
See accompanying notes to financial statements.
6
NEW CENTURY PORTFOLIOS
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 2005 (UNAUDITED)
=================================================================================================================================
NEW CENTURY
NEW CENTURY NEW CENTURY NEW CENTURY NEW CENTURY ALTERNATIVE
CAPITAL BALANCED AGGRESSIVE INTERNATIONAL STRATEGIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- ---------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments in securities:
At acquisition cost ..................... $ 90,158,861 $ 65,882,897 $ 4,516,375 $ 28,487,021 $ 60,031,282
============= ============= ============= ============= =============
At value (Note 1A) ...................... $ 103,354,198 $ 73,551,274 $ 5,299,664 $ 34,503,889 $ 64,885,863
Dividends receivable ...................... 1,159 4,509 52 1,810 2,538
Receivable for capital shares sold ........ 6,563 950 -- 2,500 51,827
Other assets .............................. 11,413 8,383 594 3,320 7,000
------------- ------------- ------------- ------------- -------------
TOTAL ASSETS ............................ 103,373,333 73,565,116 5,300,310 34,511,519 64,947,228
------------- ------------- ------------- ------------- -------------
LIABILITIES
Payable to Advisor (Note 2) ............... 123,885 91,418 806 39,605 41,560
Payable for investment securities purchased -- -- -- -- 300,000
Payable for capital shares redeemed ....... 14,520 3,000 -- -- 1,000
Other accrued expenses and liabilities .... 4,600 3,242 5,124 9,691 3,632
------------- ------------- ------------- ------------- -------------
TOTAL LIABILITIES ....................... 143,005 97,660 5,930 49,296 346,192
------------- ------------- ------------- ------------- -------------
NET ASSETS .................................. $ 103,230,328 $ 73,467,456 $ 5,294,380 $ 34,462,223 $ 64,601,036
============= ============= ============= ============= =============
Net assets consist of:
Paid-in capital ........................... $ 99,904,907 $ 69,545,145 $ 5,908,800 $ 28,223,811 $ 59,420,421
Accumulated net investment income ......... 74,083 68,337 251 71,414 133,261
Accumulated net realized gains (losses)
on investments .......................... (9,943,999) (3,814,403) (1,397,960) 150,130 192,773
Unrealized appreciation of investments .... 13,195,337 7,668,377 783,289 6,016,868 4,854,581
------------- ------------- ------------- ------------- -------------
Net assets .................................. $ 103,230,328 $ 73,467,456 $ 5,294,380 $ 34,462,223 $ 64,601,036
============= ============= ============= ============= =============
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) ............................. 7,501,445 5,889,363 690,975 3,192,850 5,693,339
============= ============= ============= ============= =============
Net asset value, offering price and
redemption price per share (a) ............ $ 13.76 $ 12.47 $ 7.66 $ 10.79 $ 11.35
============= ============= ============= ============= =============
(a) Redemption price may differ from the net asset value per share depending upon the length of time held (Note 1B).
See accompanying notes to financial statements.
7
NEW CENTURY PORTFOLIOS
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
=================================================================================================================================
NEW CENTURY
NEW CENTURY NEW CENTURY NEW CENTURY NEW CENTURY ALTERNATIVE
CAPITAL BALANCED AGGRESSIVE INTERNATIONAL STRATEGIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- ---------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Dividends ................................. $ 558,811 $ 1,143,197 $ 35,186 $ 266,277 $ 892,019
------------- ------------- ------------- ------------- -------------
EXPENSES
Investment advisory fees (Note 2) ......... 526,356 373,536 27,753 151,197 220,050
Distribution costs (Note 3) ............... 92,500 50,734 6,474 32,317 12,967
Accounting fees ........................... 20,373 18,752 15,280 16,532 17,941
Legal and audit fees ...................... 30,102 21,092 1,557 9,299 15,866
Administration fees (Note 2) .............. 24,067 17,759 4,209 9,055 14,630
Transfer agent fees ....................... 10,500 10,500 10,500 10,500 10,500
Custody fees .............................. 10,492 8,412 1,661 4,611 7,796
Trustees' fees and expenses (Note 2) ...... 6,245 4,375 314 1,922 3,645
Postage and supplies ...................... 3,903 3,375 2,101 2,290 2,932
Insurance expense ......................... 3,053 2,177 158 646 1,365
Other expenses ............................ 1,580 15,294 2,656 4,970 5,196
------------- ------------- ------------- ------------- -------------
Total expenses .......................... 729,171 526,006 72,663 243,339 312,888
Less fees waived and/or expenses
reimbursed by the Advisor (Note 2) ...... -- -- (31,033) (16,544) --
------------- ------------- ------------- ------------- -------------
Net expenses ............................ 729,171 526,006 41,630 226,795 312,888
------------- ------------- ------------- ------------- -------------
NET INVESTMENT INCOME (LOSS) ................ (170,360) 617,191 (6,444) 39,482 579,131
REALIZED AND UNREALIZED GAINS
(LOSSES) ON INVESTMENTS
Net realized gains on investments .......... 2,228,969 1,163,258 72,029 -- 214,041
Capital gain distributions from regulated
investment companies ..................... 1,660,597 1,005,979 70,947 183,833 1,034,999
Net change in unrealized appreciation/
(depreciation) on investments ............ (646,998) (695,114) 134,703 2,157,817 (322,922)
------------- ------------- ------------- ------------- -------------
NET REALIZED AND UNREALIZED
GAINS ON INVESTMENTS ...................... 3,242,568 1,474,123 277,679 2,341,650 926,118
------------- ------------- ------------- ------------- -------------
NET INCREASE IN NET
ASSETS FROM OPERATIONS .................... $ 3,072,208 $ 2,091,314 $ 271,235 $ 2,381,132 $ 1,505,249
============= ============= ============= ============= =============
See accompanying notes to financial statements.
8
NEW CENTURY PORTFOLIOS
STATEMENTS OF CHANGES IN NET ASSETS
=======================================================================================================================
NEW CENTURY NEW CENTURY
CAPITAL PORTFOLIO BALANCED PORTFOLIO
------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, 2005 OCTOBER 31, APRIL 30, 2005 OCTOBER 31,
(UNAUDITED) 2004 (UNAUDITED) 2004
- -----------------------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income (loss) ................... $ (170,360) $ (917,292) $ 617,191 $ 651,177
Net realized gains from
security transactions ........................ 2,228,969 5,347,494 1,163,258 1,597,601
Capital gain distributions from regulated
investment companies ......................... 1,660,597 388,246 1,005,979 280,790
Net change in unrealized appreciation/
(depreciation) on investments ................ (646,998) 3,016,709 (695,114) 2,916,387
------------- ------------- ------------- -------------
Net increase in net assets from operations ....... 3,072,208 7,835,157 2,091,314 5,445,955
------------- ------------- ------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (Note 1E) ........... -- -- (1,007,979) (668,754)
From net realized gains on security
transactions (Note 1E) ....................... -- -- -- --
------------- ------------- ------------- -------------
Net decrease in net assets from
distributions to shareholders .................. -- -- (1,007,979) (668,754)
------------- ------------- ------------- -------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ...................... 3,724,210 6,977,635 2,462,300 5,125,191
Net asset value of shares issued in reinvestment
of distributions to shareholders ............. -- -- 968,312 623,494
Payments for shares redeemed ................... (6,825,836) (6,948,812) (5,373,897) (6,639,206)
------------- ------------- ------------- -------------
Net increase (decrease) in net assets from
capital share transactions ..................... (3,101,626) 28,823 (1,943,285) (890,521)
------------- ------------- ------------- -------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS .................................. (29,418) 7,863,980 (859,950) 3,886,680
NET ASSETS
Beginning of period ............................ 103,259,746 95,395,766 74,327,406 70,440,726
------------- ------------- ------------- -------------
End of period .................................. $ 103,230,328 $ 103,259,746 $ 73,467,456 $ 74,327,406
============= ============= ============= =============
ACCUMULATED NET INVESTMENT
INCOME ......................................... $ 74,083 $ -- $ 68,337 $ 291,199
============= ============= ============= =============
CAPITAL SHARE ACTIVITY
Sold ........................................... 261,181 532,195 192,170 423,870
Reinvested ..................................... -- -- 74,600 51,911
Redeemed ....................................... (477,953) (534,090) (419,247) (549,921)
------------- ------------- ------------- -------------
Net decrease in shares outstanding ............. (216,772) (1,895) (152,477) (74,140)
Shares outstanding, beginning of period ........ 7,718,217 7,720,112 6,041,840 6,115,980
------------- ------------- ------------- -------------
Shares outstanding, end of period .............. 7,501,445 7,718,217 5,889,363 6,041,840
============= ============= ============= =============
See accompanying noted to financial statements.
9
NEW CENTURY PORTFOLIOS
STATEMENTS OF CHANGES IN NET ASSETS
=====================================================================================================================
NEW CENTURY NEW CENTURY
AGGRESSIVE PORTFOLIO INTERNATIONAL PORTFOLIO
----------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, 2005 OCTOBER 31, APRIL 30, 2005 OCTOBER 31,
(UNAUDITED) 2004 (UNAUDITED) 2004
- ---------------------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income (loss) ................... $ (6,444) $ (56,431) $ 39,482 $ (130,081)
Net realized gains from
security transactions ........................ 72,029 304,188 -- 1,136,175
Capital gain distributions from regulated
investment companies ......................... 70,947 20,496 183,833 12,092
Net change in unrealized appreciation/
(depreciation) on investments ................. 134,703 (18,638) 2,157,817 1,785,093
------------ ------------ ------------ ------------
Net increase in net assets from operations ....... 271,235 249,615 2,381,132 2,803,279
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (Note 1E) ........... -- -- -- --
From net realized gains on security
transactions (Note 1E) ....................... -- -- (789,174) --
------------ ------------ ------------ ------------
Net decrease in net assets from
distributions to shareholders .................. -- -- (789,174) --
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ...................... 239,725 530,663 7,985,477 7,138,355
Net asset value of shares issued in reinvestment
of distributions to shareholders ............. -- -- 788,064 --
Payments for shares redeemed ................... (728,586) (133,786) (351,948) (781,003)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets from capital
share transactions ............................. (488,861) 396,877 8,421,593 6,357,352
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS .................................. (217,626) 646,492 10,013,551 9,160,631
NET ASSETS
Beginning of period ............................ 5,512,006 4,865,514 24,448,672 15,288,041
------------ ------------ ------------ ------------
End of period .................................. $ 5,294,380 $ 5,512,006 $ 34,462,223 $ 24,448,672
============ ============ ============ ===========
ACCUMULATED NET INVESTMENT
INCOME ......................................... $ 251 $ -- $ 71,414 $ --
============ ============ ============ ===========
CAPITAL SHARE ACTIVITY
Sold ........................................... 30,863 73,300 725,167 747,210
Reinvested ..................................... -- -- 71,773 --
Redeemed ....................................... (95,175) (18,336) (32,206) (80,727)
------------ ------------ ------------ ------------
Net increase (decrease) in shares outstanding .. (64,312) 54,964 764,734 666,483
Shares outstanding, beginning of period ........ 755,287 700,323 2,428,116 1,761,633
------------ ------------ ------------ ------------
Shares outstanding, end of period .............. 690,975 755,287 3,192,850 2,428,116
============ ============ ============ ===========
See accompanying notes to financial statements.
10
NEW CENTURY PORTFOLIOS
STATEMENTS OF CHANGES IN NET ASSETS
=====================================================================================================
NEW CENTURY ALTERNATIVE
STRATEGIES PORTFOLIO
-------------------------------
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, 2005 OCTOBER 31,
(UNAUDITED) 2004
- -----------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ............................................. $ 579,131 $ 455,953
Net realized gains from security transactions ..................... 214,041 739,129
Capital gain distributions from regulated investment companies .... 1,034,999 320,147
Net change in unrealized appreciation/(depreciation) on investments (322,922) 2,023,614
------------ ------------
Net increase in net assets from operations .......................... 1,505,249 3,538,843
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (Note 1E) .............................. (1,069,317) (581,288)
From net realized gains on security transactions (Note 1E) ........ (1,234,575) --
------------ ------------
Net decrease in net assets from distributions to shareholders ....... (2,303,892) (581,288)
------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ......................................... 12,928,184 16,825,271
Net asset value of shares issued in reinvestment of
distributions to shareholders ................................... 2,282,936 573,254
Payments for shares redeemed ...................................... (1,446,195) (2,455,448)
------------ ------------
Net increase in net assets from capital share transactions .......... 13,764,925 14,943,077
------------ ------------
TOTAL INCREASE IN NET ASSETS ........................................ 12,966,282 17,900,632
NET ASSETS
Beginning of period ............................................... 51,634,754 33,734,122
------------ ------------
End of period ..................................................... $ 64,601,036 $ 51,634,754
============ ============
ACCUMULATED NET INVESTMENT INCOME ................................... $ 133,261 $ 172,051
============ ============
CAPITAL SHARE ACTIVITY
Sold .............................................................. 1,114,874 1,509,894
Reinvested ........................................................ 198,516 52,209
Redeemed .......................................................... (125,321) (219,440)
------------ ------------
Net increase in shares outstanding ................................ 1,188,069 1,342,663
Shares outstanding, beginning of period ........................... 4,505,270 3,162,607
------------ ------------
Shares outstanding, end of period ................................. 5,693,339 4,505,270
============ ============
See accompanying notes to financial statements.
11
NEW CENTURY CAPITAL PORTFOLIO
FINANCIAL HIGHLIGHTS
=========================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
=========================================================================================================================
SIX MONTHS
ENDED
APRIL 30, YEARS ENDED OCTOBER 31,
2005 -----------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
- -------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period .......... $ 13.38 $ 12.36 $ 10.09 $ 11.97 $ 18.07 $ 16.71
--------- --------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment loss ......................... (0.02) (0.12) (0.06) (0.08) (0.10) (0.14)
Net realized and unrealized gains
(losses) on investments .................... 0.40 1.14 2.33 (1.80) (4.62) 2.67
--------- --------- --------- --------- --------- ---------
Total from investment operations ............... 0.38 1.02 2.27 (1.88) (4.72) 2.53
--------- --------- --------- --------- --------- ---------
Less distributions:
Distributions from net
investment income .......................... -- -- -- -- -- --
Distributions from net realized gains ........ -- -- -- -- (1.38) (1.17)
--------- --------- --------- --------- --------- ---------
Total distributions .......................... -- -- -- -- (1.38) (1.17)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period ............... $ 13.76 $ 13.38 $ 12.36 $ 10.09 $ 11.97 $ 18.07
========= ========= ========= ========= ========= =========
TOTAL RETURN (a) ................................ 2.84%(b) 8.25% 22.50% (15.71%) (27.77%) 14.92%
========= ========= ========= ========= ========= =========
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's) ............. $ 103,230 $ 103,260 $ 95,396 $ 82,310 $ 109,873 $ 156,668
========= ========= ========= ========= ========= =========
Ratio of expenses to average net assets (c) ... 1.36%(e) 1.41% 1.45% 1.40% 1.29% 1.27%
Ratio of net investment loss to
average net assets (d) ...................... (0.32%)(e) (0.91%) (0.59%) (0.62%) (0.72%) (0.80%)
Portfolio turnover ............................ 23%(e) 48% 71% 59% 70% 51%
(a) Total return is a measure of the change in the value of an investment in
the Portfolio over the periods covered, which assumes any dividends or
capital gains distributions are reinvested in shares of the Portfolio.
Returns shown do not reflect the deduction of taxes a shareholder would pay
on Portfolio distributions or the redemption of Portfolio shares.
(b) Not annualized.
(c) The ratios of expenses to average net assets do not reflect the Portfolio's
proportionate share of expenses of the underlying investment companies in
which the Portfolio invests.
(d) Recognization of net investment income by the Portfolio is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Portfolio invests.
(e) Annualized.
See accompanying notes to financial statements.
12
NEW CENTURY BALANCED PORTFOLIO
FINANCIAL HIGHLIGHTS
=========================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
=========================================================================================================================
SIX MONTHS
ENDED
APRIL 30, YEARS ENDED OCTOBER 31,
2005 -----------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
- -------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period .......... $ 12.30 $ 11.52 $ 9.89 $ 11.35 $ 13.64 $ 13.42
--------- --------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income ......................... 0.11 0.11 0.16 0.13 0.23 0.22
Net realized and unrealized gains
(losses) on investments ...................... 0.23 0.78 1.67 (1.49) (1.71) 1.17
--------- --------- --------- --------- --------- ---------
Total from investment operations ................ 0.34 0.89 1.83 (1.36) (1.48) 1.39
--------- --------- --------- --------- --------- ---------
Less distributions:
Distributions from net
investment income ......................... (0.17) (0.11) (0.20) (0.10) (0.23) (0.22)
Distributions from net realized gains ....... -- -- -- -- (0.58) (0.95)
--------- --------- --------- --------- --------- ---------
Total distributions ........................... (0.17) ( 0.11 ) (0.20) (0.10) (0.81) (1.17)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period ................ $ 12.47 $ 12.30 $ 11.52 $ 9.89 $ 11.35 $ 13.64
========= ========= ========= ========= ========= =========
TOTAL RETURN (a) ................................ 2.74%(b) 7.75% 18.84% (12.08%) (11.21%) 10.26%
========= ========= ========= ========= ========= =========
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's) ............. $ 73,467 $ 74,327 $ 70,441 $ 62,755 $ 71,251 $ 79,553
========= ========= ========= ========= ========= =========
Ratio of expenses to average net assets (f) ... 1.41%(e) 1.42%(d) 1.45%(c) 1.48% 1.49% 1.40%
Ratio of net investment income to
average net assets (g) ...................... 1.65%(e) 0.88%(d) 1.56%(c) 1.19% 1.87% 1.51%
Portfolio turnover ............................ 33%(e) 44% 80% 93% 69% 43%
(a) Total return is a measure of the change in the value of an investment in
the Portfolio over the periods covered, which assumes any dividends or
capital gains distributions are reinvested in shares of the Portfolio.
Returns shown do not reflect the deduction of taxes a shareholder would pay
on Portfolio distributions or the redemption of Portfolio shares.
(b) Not annualized.
(c) Absent fee waivers and expense reimbursements by the Advisor, the ratio of
expenses to average net assets would have been 1.46% and the ratio of net
investment income to average net assets would have been 1.55% for the year
ended October 31, 2003 (Note 2).
(d) Absent the recoupment of fees previously waived and reimbursed by the
Advisor, the ratio of expenses to average net assets would have been 1.41%
and the ratio of net investment income to average net assets would have
been 0.89% for the year ended October 31, 2004 (Note 2).
(e) Annualized.
(f) The ratios of expenses to average net assets do not reflect the Portfolio's
proportionate share of expenses of the underlying investment companies in
which the Portfolio invests.
(g) Recognization of net investment income by the Portfolio is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Portfolio invests.
See accompanying notes to financial statements.
13
NEW CENTURY AGGRESSIVE PORTFOLIO
FINANCIAL HIGHLIGHTS
========================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
========================================================================================================================
SIX MONTHS
ENDED
APRIL 30, YEARS ENDED OCTOBER 31,
2005 ----------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001
- ------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period .... $ 7.30 $ 6.95 $ 5.47 $ 7.37 $ 10.00
------------ ------------ ------------ ------------ ------------
Income (loss) from investment operations:
Net investment loss ................... (0.01) (0.07) (0.06) (0.07) (0.07)
Net realized and unrealized gains
(losses) on investments .............. 0.37 0.42 1.54 (1.83) (2.56)
------------ ------------ ------------ ------------ ------------
Total from investment operations ........ 0.36 0.35 1.48 (1.90) (2.63)
------------ ------------ ------------ ------------ ------------
Less distributions:
Distributions from net
investment income ................... -- -- -- -- --
Distributions from net realized gains . -- -- -- -- --
------------ ------------ ------------ ------------ ------------
Total distributions ..................... -- -- -- -- --
------------ ------------ ------------ ------------ ------------
Net asset value, end of period .......... $ 7.66 $ 7.30 $ 6.95 $ 5.47 $ 7.37
============ ============ ============ ============ ============
TOTAL RETURN (a) .......................... 4.93%(b) 5.04% 27.06% (25.78%) (26.30%)
============ ============ ============ ============ ============
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's) ....... $ 5,294 $ 5,512 $ 4,866 $ 3,610 $ 1,846
============ ============ ============ ============ ============
Ratios of expenses to average net assets:
Before expense reimbursement
and waived fees (c) ................. 2.62%(e) 2.71% 3.20% 2.95% 5.90%
After expense reimbursement
and waived fees (c) ................. 1.50%(e) 1.50% 1.50% 1.50% 1.50%
Ratios of net investment loss
to average net assets:
Before expense reimbursement
and waived fees (d) ................. (1.35%)(e) (2.27%) (2.73%) (2.50%) (5.35%)
After expense reimbursement
and waived fees (d) ................. (0.23%)(e) (1.06%) (1.03%) (1.05%) (0.95%)
Portfolio turnover ...................... 15%(e) 68% 78% 120% 86%
(a) Total return is a measure of the change in the value of an investment in
the Portfolio over the periods covered, which assumes any dividends or
capital gains distributions are reinvested in shares of the Portfolio.
Returns shown do not reflect the deduction of taxes a shareholder would pay
on Portfolio distributions or the redemption of Portfolio shares.
(b) Not annualized.
(c) The ratios of expenses to average net assets do not reflect the Portfolio's
proportionate share of expenses of the underlying investment companies in
which the Portfolio invests.
(d) Recognization of net investment income by the Portfolio is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Portfolio invests.
(e) Annualized.
See accompanying notes to financial statements.
14
NEW CENTURY INTERNATIONAL PORTFOLIO
FINANCIAL HIGHLIGHTS
========================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
========================================================================================================================
SIX MONTHS
ENDED
APRIL 30, YEARS ENDED OCTOBER 31,
2005 ----------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001
- ------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period .... $ 10.07 $ 8.68 $ 6.52 $ 7.41 $ 10.00
------------ ------------ ------------ ------------ ------------
Income (loss) from investment operations:
Net investment income (loss) .......... 0.01 (0.05) (0.03) (0.06) (0.04)
Net realized and unrealized gains
(losses) on investments .............. 1.02 1.44 2.19 (0.81) (2.55)
------------ ------------ ------------ ------------ ------------
Total from investment operations ........ 1.03 1.39 2.16 (0.87) (2.59)
------------ ------------ ------------ ------------ ------------
Less distributions:
Distributions from net
investment income ................... -- -- -- (0.02) --
Distributions from net realized gains . (0.31) -- -- -- --
------------ ------------ ------------ ------------ ------------
Total distributions ..................... (0.31) -- -- (0.02) --
------------ ------------ ------------ ------------ ------------
Net asset value, end of period .......... $ 10.79 $ 10.07 $ 8.68 $ 6.52 $ 7.41
============ ============ ============ ============ ============
TOTAL RETURN (a) .......................... 10.13%(b) 16.01% 33.13% (11.84%) (25.90%)
============ ============ ============ ============ ============
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's) ....... $ 34,462 $ 24,449 $ 15,288 $ 7,655 $ 731
============ ============ ============ ============ ============
Ratios of expenses to average net assets:
Before expense reimbursement
and waived fees (c) ................. 1.61%(e) 1.74% 2.11% 2.54% 10.81%
After expense reimbursement
and waived fees (c) ................. 1.50%(e) 1.50% 1.50% 1.50% 1.50%
Ratios of net investment income (loss)
to average net assets:
Before expense reimbursement
and waived fees (d) ................. 0.15%(e) (0.88%) (1.16%) (2.34%) (9.81%)
After expense reimbursement
and waived fees (d) ................. 0.26%(e) (0.64%) (0.55%) (1.30%) (0.50%)
Portfolio turnover ...................... 0%(e) 45% 56% 27% 83%
(a) Total return is a measure of the change in the value of an investment in
the Portfolio over the periods covered, which assumes any dividends or
capital gains distributions are reinvested in shares of the Portfolio.
Returns shown do not reflect the deduction of taxes a shareholder would pay
on Portfolio distributions or the redemption of Portfolio shares.
(b) Not annualized.
(c) The ratios of expenses to average net assets do not reflect the Portfolio's
proportionate share of expenses of the underlying investment companies in
which the Portfolio invests.
(d) Recognization of net investment income by the Portfolio is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Portfolio invests.
(e) Annualized.
See accompanying notes to financial statements.
15
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO
FINANCIAL HIGHLIGHTS
==================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
==================================================================================================================
SIX MONTHS
ENDED YEARS ENDED OCTOBER 31,
APRIL 30, 2005 ---------------------------------------------------
(UNAUDITED) 2004 2003 2002(a)
- ------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING PERFORMANCE
Net asset value, beginning of period ....... $ 11.46 $ 10.67 $ 9.12 $ 10.00
---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income .................... 0.17 0.14 0.11 0.01
Net realized and unrealized gains (losses)
on investments ......................... 0.19 0.83 1.54 (0.89)
---------- ---------- ---------- ----------
Total from investment operations ........... 0.36 0.97 1.65 (0.88)
---------- ---------- ---------- ----------
Less distributions:
Distributions from net investment income . (0.22) (0.18) (0.10) --
Distributions from net realized gains .... (0.25) -- -- --
---------- ---------- ---------- ----------
Total distributions ........................ (0.47) (0.18) (0.10) --
---------- ---------- ---------- ----------
Net asset value, end of period ............. $ 11.35 $ 11.46 $ 10.67 $ 9.12
========== ========== ========== ==========
TOTAL RETURN (c) ............................. 3.12%(b) 9.12% 18.20% (8.80%)(b)
========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's) .......... $ 64,601 $ 51,635 $ 33,734 $ 19,529
========== ========== ========== ==========
Ratios of expenses to average net assets (f) 1.06%(d) 1.12% 1.40% 1.49%(d)(e)
Ratios of net investment income to
average net assets (g) ................... 1.97%(d) 1.04% 1.06% 0.32%(d)(e)
Portfolio turnover ......................... 6%(d) 11% 21% 7%(d)
(a) Represents the period from the initial public offering of shares (May 1,
2002) through October 31, 2002.
(b) Not annualized.
(c) Total return is a measure of the change in the value of an investment in
the Portfolio over the periods covered, which assumes any dividends or
capital gains distributions are reinvested in shares of the Portfolio.
Returns shown do not reflect the deduction of taxes a shareholder would pay
on Portfolio distributions or the redemption of Portfolio shares.
(d) Annualized.
(e) Absent fee waivers and expense reimbursements by the Advisor, the ratio of
expenses to average net assets would have been 1.72%(d) and the ratio of
net investment income to average net assets would have been 0.09%(d) for
the period ended October 31, 2002 (Note 2).
(f) The ratios of expenses to average net assets do not reflect the Portfolio's
proportionate share of expenses of the underlying investment companies in
which the Portfolio invests.
(g) Recognization of net investment income by the Portfolio is affected by the
timing of the declaration of dividends by the underlying investment
companies in which the Portfolio invests.
See accompanying notes to financial statements.
16
NEW CENTURY CAPITAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 2005 (UNAUDITED)
================================================================================
INVESTMENT COMPANIES -- 99.4% SHARES VALUE
- --------------------------------------------------------------------------------
GROWTH AND INCOME FUNDS -- 35.3%
Fidelity Select Utilities Growth ................. 66,093 $ 2,661,568
Hotchkis & Wiley Large Cap Value - Class A ....... 380,152 8,321,538
iShares Dow Jones Select Dividend Index .......... 137,100 8,164,305
iShares Dow Jones U.S. Energy Sector Index ....... 45,700 3,225,049
iShares Russell 1000 Value Index ................. 14,800 959,336
iShares S&P 500 Index ............................ 25,650 2,969,501
iShares S&P MidCap 400/BARRA Value Index ......... 36,500 4,469,425
Powershares Dynamic Market ....................... 51,200 2,001,408
Vanguard 500 Index - Investor Shares ............. 34,759 3,709,111
------------
36,481,241
------------
GROWTH FUNDS -- 33.3%
American Funds AMCAP - Class A ................... 214,678 3,728,956
American Growth Fund of America - Class A ........ 260,248 6,818,514
Calamos Growth - Class A (a) ..................... 141,042 6,616,273
Fidelity Capital Appreciation .................... 233,743 5,535,028
Goldman Sachs Growth Opportunities - Class A (a) . 213,091 4,257,568
iShares Russell 1000 Growth Index ................ 235 10,817
Marsico 21st Century (a) ......................... 574,563 6,136,330
Wells Fargo Advantage Endeavor Select - Class A (a) 151,263 1,256,996
------------
34,360,482
------------
SMALL COMPANY FUNDS -- 17.5%
Buffalo Small Cap ................................ 52,442 1,326,795
FBR Small Cap (a) ................................ 43,659 1,710,121
iShares S&P SmallCap 600/BARRA Growth Index ...... 21,700 2,153,725
iShares S&P SmallCap 600/BARRA Value Index ....... 13,700 1,533,441
Royce Opportunity - Investor Class (a) ........... 412,915 4,835,233
William Blair Small Cap Growth - Class I (a) ..... 282,545 6,478,748
------------
18,038,063
------------
FOREIGN STOCK FUNDS -- 13.3%
Dodge & Cox International Stock .................. 93,583 2,833,688
Fidelity Japan Small Companies ................... 20,473 265,121
iShares MSCI EAFE Index .......................... 13,400 2,094,420
iShares MSCI Emerging Markets Index .............. 19,400 3,885,238
Lazard International Small Cap - Investor Shares . 148,914 2,863,624
Tocqueville International Value (The) ............ 125,587 1,782,080
------------
13,724,171
------------
TOTAL INVESTMENT COMPANIES (Cost $89,408,620)......... $102,603,957
------------
17
NEW CENTURY CAPITAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
MONEY MARKET SECURITIES -- 0.7% SHARES VALUE
- --------------------------------------------------------------------------------
First American Treasury Obligation - Class A
(Cost $750,241) .................................. 750,241 $ 750,241
------------
TOTAL INVESTMENTS AT VALUE --100.1% (Cost $90,158,861) $103,354,198
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.1%)....... (123,870)
------------
NET ASSETS -- 100.0%.................................. $103,230,328
============
(a) Non-income producing security.
See accompanying notes to financial statements.
18
NEW CENTURY BALANCED PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 2005 (UNAUDITED)
================================================================================
INVESTMENT COMPANIES -- 98.1% SHARES VALUE
- --------------------------------------------------------------------------------
GROWTH AND INCOME FUNDS -- 33.0%
Dodge & Cox Stock ................................ 26,898 $ 3,385,111
Fidelity Select Utilities Growth ................. 45,393 1,827,957
Hotchkis & Wiley Large Cap Value - Class A ....... 266,782 5,839,849
iShares Dow Jones Select Dividend Index .......... 90,600 5,395,230
iShares Dow Jones U.S. Energy Sector Index ....... 19,100 1,347,887
iShares Russell 1000 Value Index ................. 200 12,964
iShares S&P 500 Index ............................ 45,900 5,313,843
iShares S&P MidCap 400/BARRA Value Index ......... 4,500 551,025
Vanguard 500 Index - Investor Shares ............. 5,547 591,960
------------
24,265,826
------------
HIGH YIELD BOND FUNDS -- 12.4%
Fidelity Advisor High Income Advantage - Class I . 497,009 4,547,631
MainStay High Yield Corporate Bond - Class A ..... 736,334 4,557,908
------------
9,105,539
------------
GROWTH FUNDS -- 11.8%
American Funds AMCAP - Class A ................... 161,597 2,806,941
Calamos Growth - Class A (a) ..................... 29,047 1,362,609
Fidelity Capital Appreciation .................... 54,681 1,294,855
iShares Russell 1000 Growth Index ................ 300 13,809
S&P MidCap 400 Depositary Receipts ............... 17,580 2,037,874
Wells Fargo Advantage Endeavor Select - Class A (a) 134,814 1,120,307
------------
8,636,395
------------
SMALL COMPANY FUNDS -- 10.3%
FBR Small Cap (a) ................................ 22,666 887,809
iShares S&P SmallCap 600/BARRA Growth Index ...... 15,400 1,528,450
iShares S&P SmallCap 600/BARRA Value Index ....... 13,900 1,555,827
Royce Opportunity - Investor Class (a) ........... 102,269 1,197,571
William Blair Small Cap Growth - Class I (a) ..... 104,528 2,396,834
------------
7,566,491
------------
FOREIGN STOCK FUNDS -- 8.9%
Dodge & Cox International Stock .................. 16,512 500,000
iShares MSCI EAFE Index .......................... 19,100 2,985,330
Lazard International Small Cap - Investor Shares . 52,361 1,006,908
Tocqueville International Value (The) ............ 143,495 2,036,192
------------
6,528,430
------------
CONVERTIBLE SECURITY FUNDS -- 5.1%
Davis Appreciation & Income ...................... 79,909 2,141,564
Franklin Convertible Securities - Class A ........ 105,834 1,620,319
------------
3,761,883
------------
CORPORATE BOND FUNDS -- 5.0%
Loomis Sayles Bond - Institutional Class ......... 272,850 3,678,011
------------
GOVERNMENT BOND FUNDS -- 4.3%
American Century Target Maturities
Trust Series 2015 - Investor Class ............. 41,756 3,142,522
------------
19
NEW CENTURY BALANCED PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
INVESTMENT COMPANIES -- 98.1% (Continued) SHARES VALUE
- --------------------------------------------------------------------------------
Worldwide Bond Funds -- 3.5%
Loomis Sayles Global Bond - Institutional Class .. 71,792 $ 1,142,935
PIMCO Foreign Bond - Institutional Class ......... 132,146 1,408,673
------------
2,551,608
------------
HIGH QUALITY BOND FUNDS -- 3.1%
Dodge & Cox Income ............................... 182,075 2,321,453
------------
EMERGING MARKETS FUNDS -- 0.7%
TCW Galileo Emerging Markets Income - Class I .... 63,132 499,372
------------
TOTAL INVESTMENT COMPANIES (Cost $64,389,153)......... $ 72,057,530
------------
================================================================================
MONEY MARKET SECURITIES -- 2.0% SHARES VALUE
- --------------------------------------------------------------------------------
First American Treasury Obligation - Class A
(Cost $1,493,744) ................................ 1,493,744 $ 1,493,744
------------
TOTAL INVESTMENTS AT VALUE -- 100.1% (Cost $65,882,897) $ 73,551,274
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.1%)....... (83,818)
------------
NET ASSETS -- 100.0% ................................. $ 73,467,456
============
(a) Non-income producing security.
See accompanying notes to financial statements.
20
NEW CENTURY AGGRESSIVE PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 2005 (UNAUDITED)
================================================================================
INVESTMENT COMPANIES -- 99.4% SHARES VALUE
- --------------------------------------------------------------------------------
SECTOR FUNDS -- 64.6%
Fidelity Select Medical Delivery (a) ............. 5,097 $ 234,911
Fidelity Select Wireless (a) ..................... 19,538 108,632
iShares Dow Jones U.S. Energy Sector Index ....... 13,400 945,638
iShares Goldman Sachs Natural Resources Index .... 4,300 592,540
iShares Goldman Sachs Networking Index (a) ....... 11,100 271,950
iShares MSCI Emerging Markets Index .............. 2,900 580,783
iShares Nasdaq Biotechnology Index (a) ........... 2,800 177,716
Technology Select Sector SPDR .................... 26,800 505,984
------------
3,418,154
------------
MID-CAP FUNDS -- 20.6%
Calamos Growth - Class A (a) ..................... 9,313 436,890
iShares S&P MidCap 400/BARRA Growth Index ........ 1,500 192,690
S&P MidCap 400 Depositary Receipts ............... 4,002 463,912
------------
1,093,492
------------
SMALL-CAP FUNDS -- 8.8%
Buffalo Small Cap ................................ 10,201 258,097
Perritt Micro Cap Opportunities .................. 8,123 207,043
------------
465,140
------------
LARGE-CAP FUNDS -- 5.4%
Fidelity Capital Appreciation .................... 12,030 284,868
------------
TOTAL INVESTMENT COMPANIES (Cost $4,478,365).......... $ 5,261,654
------------
================================================================================
MONEY MARKET SECURITIES -- 0.7% SHARES VALUE
- --------------------------------------------------------------------------------
First American Treasury Obligation - Class A
(Cost $38,010) ................................... 38,010 $ 38,010
------------
TOTAL INVESTMENTS AT VALUE -- 100.1% (Cost $4,516,375) $ 5,299,664
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.1%)....... (5,284)
------------
NET ASSETS -- 100.0%.................................. $ 5,294,380
============
(a) Non-income producing security.
See accomanying notes to financial statements.
21
NEW CENTURY INTERNATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 2005 (UNAUDITED)
================================================================================
INVESTMENT COMPANIES -- 98.9% SHARES VALUE
- --------------------------------------------------------------------------------
EUROPE FUNDS -- 28.8%
iShares MSCI Austria Index ....................... 113,600 $ 2,508,288
iShares MSCI Belgium Index ....................... 81,400 1,482,294
iShares MSCI Germany Index ....................... 97,200 1,681,560
iShares MSCI Sweden Index ........................ 60,300 1,210,221
iShares MSCI United Kingdom Index ................ 45,646 817,520
Ivy European Opportunities - Class A ............. 82,104 2,229,130
------------
9,929,013
------------
DIVERSIFIED FUNDS -- 23.8%
Dodge & Cox International Stock .................. 78,279 2,370,283
iShares MSCI EAFE Index .......................... 10,300 1,609,890
Lazard International Small Cap - Investor Shares . 91,181 1,753,414
Oakmark International - Class I .................. 16,170 341,187
Tocqueville International Value (The) ............ 149,313 2,118,758
------------
8,193,532
------------
ASIA/PACIFIC FUNDS -- 21.2%
Fidelity Japan Small Companies ................... 111,604 1,445,268
iShares MSCI Australia Index ..................... 100,400 1,692,744
iShares MSCI Pacific Ex-Japan Index .............. 10,700 971,346
Matthews China ................................... 90,910 1,286,373
Matthews Japan (a) ............................... 84,309 1,328,706
Matthews Pacific Tiger - Class I ................. 37,376 586,061
------------
7,310,498
------------
AMERICAS FUNDS -- 14.5%
Fidelity Canada .................................. 31,133 1,042,011
iShares MSCI Canada Index ........................ 69,300 1,157,310
iShares MSCI Mexico Index ........................ 32,300 760,665
iShares S&P Latin American 40 Index .............. 25,400 2,046,224
------------
5,006,210
------------
EMERGING MARKETS FUNDS -- 10.6%
Dreyfus Premier Emerging Markets - Class A ....... 30,738 584,021
iShares MSCI Emerging Markets Index .............. 6,400 1,281,728
T. Rowe Price Emerging Europe & Mediterranean .... 102,208 1,793,745
------------
3,659,494
------------
TOTAL INVESTMENT COMPANIES (Cost $28,081,879)......... $ 34,098,747
------------
================================================================================
MONEY MARKET SECURITIES -- 1.2% SHARES VALUE
- --------------------------------------------------------------------------------
First American Treasury Obligation - Class A
(Cost $405,142) .................................. 405,142 $ 405,142
------------
TOTAL INVESTMENTS AT VALUE -- 100.1% (Cost $28,487,021) $ 34,503,889
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.1%)....... (41,666)
------------
NET ASSETS -- 100.0%.................................. $ 34,462,223
============
(a) Non-income producing security.
See accompanying notes to financial statements.
22
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 2005 (UNAUDITED)
================================================================================
INVESTMENT COMPANIES -- 97.6% SHARES VALUE
- --------------------------------------------------------------------------------
MERGER ARBITRAGE FUNDS -- 15.7%
Arbitrage Fund (The) - Class R (a) ............... 204,006 $ 2,395,035
Enterprise Mergers and Acquisitions - Class A (a) 285,285 3,218,013
Gabelli ABC ...................................... 80,208 795,666
Merger Fund (The) ................................ 246,227 3,759,886
------------
10,168,600
------------
LONG/SHORT EQUITY FUNDS -- 13.0%
CGM Focus ........................................ 29,099 909,931
Diamond Hill Focus Long-Short - Class I (a) ...... 46,754 665,312
Franklin Templeton Global Long-Short - Class A ... 47,031 530,981
Hussman Strategic Growth ......................... 207,204 3,222,017
Needham Growth (a) ............................... 15,793 446,623
Needham Small Cap Growth (a) ..................... 7,758 126,373
Prudent Bear (a) ................................. 156,585 869,048
Schwab Hedged Equity (a) ......................... 120,475 1,632,442
------------
8,402,727
------------
GLOBAL MACRO FUNDS -- 12.7%
Capital and Income Strategies (b) ................ 14,000 238,000
First Eagle Global - Class A ..................... 119,723 4,652,421
Franklin Mutual Discovery - Class Z .............. 79,327 1,930,820
Prudent Global Income ............................ 119,424 1,396,069
------------
8,217,310
------------
ASSET ALLOCATION FUNDS -- 12.6%
Berwyn Income .................................... 80,801 948,601
FPA Crescent - Class I ........................... 87,679 2,057,816
Greenspring ...................................... 69,507 1,382,493
Leuthold Core Investment ......................... 120,136 1,871,720
Oakmark Equity and Income - Class I .............. 20,309 468,313
Potomac Contrabond (a) ........................... 17,065 300,000
Rydex Series - Juno - Investor Class (a) ......... 59,749 1,089,231
------------
8,118,174
------------
NATURAL RESOURCES FUNDS -- 9.3%
FBR Gas Utility Index ............................ 20,659 332,405
Permanent Portfolio .............................. 24,831 658,028
PIMCO Commodity Real Return Strategy - Class A ... 163,821 2,544,132
RS Global Natural Resources ...................... 72,353 1,800,152
T. Rowe Price New Era ............................ 7,931 271,172
Vanguard Precious Metals & Minerals .............. 25,245 412,497
------------
6,018,386
------------
HIGH YIELD FUNDS -- 7.7%
Calamos High Yield - Class A ..................... 59,089 612,752
Fidelity Capital & Income ........................ 75,439 614,829
MainStay Global High Income - Class A ............ 59,063 646,742
MainStay High Yield Corporate Bond - Class A .... 220,178 1,362,899
Neuberger Berman Income Opportunity (b) .......... 39,700 544,684
Pioneer High Yield - Class A ..................... 106,143 1,163,326
------------
4,945,232
------------
23
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
INVESTMENT COMPANIES -- 97.6% (Continued) SHARES VALUE
- --------------------------------------------------------------------------------
REAL ESTATE FUNDS -- 7.1%
AIM Select Real Estate Income (b) ................ 40,170 $ 641,917
Alpine Realty Income and Growth - Class Y ........ 37,459 790,757
J.P. Morgan U.S. Real Estate - Class A ........... 41,890 730,988
Scudder RREEF Real Estate (b) .................... 16,100 325,220
Third Avenue Real Estate Value ................... 77,035 2,122,322
------------
4,611,204
------------
DEEP VALUE/DISTRESSED SECURITIES FUNDS -- 6.0%
Aegis Value ...................................... 37,278 645,657
Franklin Mutual Beacon - Class Z ................. 87,985 1,396,324
Third Avenue Value ............................... 33,757 1,800,237
------------
3,842,218
------------
OPTIONS/HEDGED FUNDS -- 5.4%
Gateway .......................................... 144,556 3,512,708
------------
CONVERTIBLE ARBITRAGE FUNDS -- 4.9%
Calamos Market Neutral - A Shares ................ 258,557 3,200,932
------------
MARKET NEUTRAL FUNDS -- 3.2%
J.P. Morgan Market Neutral - Institutional Shares (a) 50,689 553,021
Laudus Rosenberg Value Long/Short Equity (a) ..... 61,508 634,151
Phoenix Capital Market Neutral - Class A (a) ..... 73,071 868,078
------------
2,055,250
------------
TOTAL INVESTMENT COMPANIES (Cost $58,252,101)......... $ 63,092,741
------------
================================================================================
COMMON STOCKS -- 0.2% SHARES VALUE
- --------------------------------------------------------------------------------
Plum Creek Timber Company, Inc.
(Cost $87,952) ................................... 2,950 $ 101,893
------------
================================================================================
MONEY MARKET SECURITIES -- 2.6% SHARES VALUE
- --------------------------------------------------------------------------------
First American Treasury Obligation - Class A
(Cost $1,691,229) ................................ 1,691,229 $ 1,691,229
------------
TOTAL INVESTMENTS AT VALUE --100.4% (Cost $60,031,282) $ 64,885,863
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.4%)....... (284,827)
------------
NET ASSETS -- 100.0%.................................. $ 64,601,036
============
(a) Non-income producing security.
(b) Closed-end fund.
See accompanying notes to financial statements.
24
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2005 (UNAUDITED)
================================================================================
(1) SIGNIFICANT ACCOUNTING POLICIES
New Century Portfolios ("New Century") is organized as a Massachusetts business
trust which is registered under the Investment Company Act of 1940, as amended,
as an open-end management investment company and currently offers shares of five
series: New Century Capital Portfolio, New Century Balanced Portfolio, New
Century Aggressive Portfolio, New Century International Portfolio and New
Century Alternative Strategies Portfolio (together, the "Portfolios"). New
Century Aggressive Portfolio and New Century International Portfolio commenced
operations on November 1, 2000, and New Century Alternative Strategies Portfolio
commenced operations on May 1, 2002.
The investment objective of New Century Capital Portfolio is to provide capital
growth, with a secondary objective to provide income, while managing risk. This
Portfolio seeks to achieve its objectives by investing primarily in shares of
other registered investment companies that emphasize investments in equities
(domestic and foreign).
The investment objective of New Century Balanced Portfolio is to provide income,
with a secondary objective to provide capital growth, while managing risk. This
Portfolio seeks to achieve its objectives by investing primarily in shares of
other registered investment companies that emphasize investments in equities
(domestic and foreign), and fixed income securities (domestic and foreign).
The investment objective of New Century Aggressive Portfolio is to provide
capital growth, without regard to current income, while managing risk. This
Portfolio seeks to achieve its objective by investing primarily in shares of
registered investment companies that emphasize investments in equities (domestic
and foreign).
The investment objective of New Century International Portfolio is to provide
capital growth, with a secondary objective to provide income, while managing
risk. This Portfolio seeks to achieve its objectives by investing primarily in
shares of registered investment companies that emphasize investments in equities
and fixed income securities (foreign, worldwide, emerging markets and domestic).
The investment objective of New Century Alternative Strategies Portfolio is to
provide long-term capital appreciation, with a secondary objective to earn
income, while managing risk. This Portfolio seeks to achieve its objectives by
investing primarily in shares of other registered investment companies that
emphasize alternative strategies.
The price of shares of each Portfolio fluctuates daily and there is no assurance
that the Portfolios will be successful in achieving their stated investment
objectives.
The following is a summary of significant accounting policies consistently
followed by the Portfolios in the preparation of their financial statements.
These policies are in conformity with accounting principles generally accepted
in the United States of America.
25
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
A. INVESTMENT VALUATION
--------------------
Investments, representing primarily capital stock of other investment companies,
are valued at their net asset value as reported by such companies. The net asset
value as reported by open-end investment companies may be based on fair value
pricing; to understand the fair value pricing process used by such companies,
consult their most current prospectus.
Investments in securities traded on a national securities exchange are valued at
the last reported sales price; securities included in the NASDAQ National Market
System are valued at the Nasdaq Official Closing Price; other securities traded
in the over-the-counter market and listed securities for which no sale is
reported on that date are valued at the last reported bid price. Other assets
and securities for which no quotations are readily available or for which
quotations Weston Financial Group, Inc. (the "Advisor") believes do not reflect
market value are valued at fair value as determined in good faith by the Advisor
under the supervision of the Board of Trustees. Short-term investments are
valued at amortized cost which approximates market value.
B. SHARE VALUATION
---------------
The net asset value per share of each Portfolio is calculated daily by dividing
the total value of each Portfolio's assets, less liabilities, by the number of
shares outstanding. The offering price and redemption price per share of each
Portfolio is equal to the net asset value per share, except that effective March
1, 2005, shares of each Portfolio are subject to a redemption fee of 2.00% if
redeemed within 30 days of the date of purchase. As of April 30, 2005 there were
no redemption fees from the Portfolios.
C. INVESTMENT TRANSACTIONS
-----------------------
Investment transactions are recorded on a trade date basis. Gains and losses on
securities sold are determined on a specific identification method.
D. INCOME RECOGNITION
------------------
Interest, if any, is accrued on portfolio investments daily. Dividend income is
recorded on the ex-dividend date.
E. DISTRIBUTIONS TO SHAREHOLDERS
-----------------------------
Dividends arising from net investment income, if any, are declared and paid
semi-annually to shareholders of the New Century Balanced and New Century
Alternative Strategies Portfolios. Dividends from net investment income, if any,
are declared and paid annually for the New Century Capital, New Century
Aggressive and New Century International Portfolios. 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. Income
distributions and capital gain distributions are determined
26
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
in accordance with income tax regulations, which may differ from accounting
principles generally accepted in the United States of America. There were no
differences between the book and tax basis of distributions for the periods
ended April 30, 2005 and October 31, 2004.
F. COST OF OPERATIONS
------------------
The Portfolios bear all costs of their operations other than expenses
specifically assumed by the Advisor. Expenses directly attributable to a
Portfolio are charged to that Portfolio; other expenses are allocated
proportionately among the Portfolios in relation to the net assets of each
Portfolio.
G. USE OF ESTIMATES
-----------------
In preparing financial statements in accordance with accounting principles
generally accepted in the United States of America, management is required to
make estimates and assumptions that affect the reported amount of assets and
liabilities, the disclosure of contingent assets and liabilities, and revenues
and expenses during the reporting period. Actual results could differ from those
estimates.
(2) INVESTMENT ADVISORY FEE, ADMINISTRATIVE
AGREEMENT AND TRUSTEES' FEE
Fees paid by the Portfolios pursuant to an Investment Advisory Agreement with
the Advisor are computed daily and paid monthly at an annualized rate of 1% on
the first $100 million of average daily net assets and .75% of average daily net
assets exceeding that amount, except the fees for New Century Alternative
Strategies Portfolio are computed at an annualized rate of .75% of average daily
net assets. The advisory fees are based on the net assets of each of the
Portfolios separately, and not on the total net assets of the Portfolios
combined.
The Advisor has agreed to limit the total expenses (excluding interest, taxes,
brokerage and extraordinary expenses) to an annual rate of 1.50% of average net
assets for each of New Century Capital, New Century Balanced, New Century
Aggressive, New Century International and New Century Alternative Strategies
Portfolios. Accordingly, for the six months ended April 30, 2005, the Advisor
waived its entire advisory fee of $27,753 and reimbursed $3,280 of other
operating expenses for New Century Aggressive Portfolio and waived investment
advisory fees of $16,544 for New Century International Portfolio. No waiver was
necessary for New Century Capital, New Century Balanced or New Century
Alternative Strategies Portfolios.
Any advisory fees waived and/or any other operating expenses absorbed by the
Advisor pursuant to an agreed upon expense cap shall be reimbursed by the
Portfolio to the Advisor, if so requested by the Advisor, provided the aggregate
amount of the Portfolio's current total operating expenses for such fiscal year
does not exceed the applicable
27
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
existing limitation on Portfolio expenses, and the reimbursement is made within
three years after the year in which the Advisor incurred the expense. During the
six months ended April 30, 2005, the Advisor did not recoup any other fees
waived or other operating expenses absorbed from New Century Aggressive
Portfolio and New Century International Portfolio. The Advisor has recouped all
fees waived and expenses reimbursed for New Century Balanced Portfolio and New
Century Alternative Strategies Portfolio.
As of April 30, 2005, the amounts available for reimbursement that have been
paid and/or waived by the Advisor on behalf of the following Portfolios are as
follows:
- --------------------------------------------------------------------------------
New Century Aggressive Portfolio .................................. $ 228,357
New Century International Portfolio ............................... $ 190,386
- --------------------------------------------------------------------------------
As of April 30, 2005, the Advisor may recapture a portion of the above amounts
no later than the dates as stated below:
- -------------------------------------------------------------------------------------------------------------
OCTOBER 31, OCTOBER 31, OCTOBER 31, OCTOBER 31,
2005 2006 2007 2008
- -------------------------------------------------------------------------------------------------------------
New Century Aggressive Portfolio ............. $ 64,472 $ 68,836 $ 64,016 $ 31,033
New Century International Portfolio .......... $ 63,079 $ 62,733 $ 48,030 $ 16,544
- -------------------------------------------------------------------------------------------------------------
Fees paid by the Portfolios pursuant to an Administration Agreement with the
Advisor to administer the ordinary course of the Portfolios' business are paid
monthly from a detail of actual expenses incurred in the overseeing of the
Portfolios' affairs. All expenses incurred overseeing the Portfolios' affairs
are reimbursed monthly.
The Portfolios pay each Trustee who is not affiliated with the Advisor a $10,000
annual retainer, paid quarterly, and a per meeting fee of $1,000. The Portfolios
will also pay each Trustee who is not affiliated with the Advisor a $1,000
special meeting fee if held independent of a Regularly Scheduled Board Meeting.
Trustees who are affiliated with the Advisor do not receive compensation.
(3) DISTRIBUTION PLAN AND OTHER TRANSACTIONS
WITH AFFILIATES
The Portfolios have adopted a Distribution Plan (the "Plan") under Section 12(b)
of the Investment Company Act of 1940 and Rule 12b-1 thereunder. Under the Plan,
each Portfolio may pay up to .25% of its average daily net assets to Weston
Securities Corporation (the "Distributor") for activities primarily intended to
result in the sale of shares. Under its terms, the Plan shall remain in effect
from year to year, provided such continuance is approved annually by a vote of a
majority of the Trustees and a majority of those Trustees who are not
"interested persons" of the Portfolios and who have no direct or indirect
financial interest in the operation of the Plan or in any agreement related to
the Plan.
28
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
During the six months ended April 30, 2005, the Distributor received $92,500,
$50,734, $6,474, $32,317 and $12,967 from New Century Capital, Balanced,
Aggressive, International and Alternative Strategies Portfolios, respectively,
pursuant to the Plan.
Also during this time, the Distributor received sales commissions and other
compensation of $39,426, $42,731, $514, $4,702 and $55,852 in connection with
the purchase of investment company shares by New Century Capital, Balanced,
Aggressive, International and Alternative Strategies Portfolios, respectively.
The Distributor has voluntarily agreed to waive payments made by each Portfolio
pursuant to the Plan in amounts equal to the sales commissions and other
compensation.
Certain officers and trustees of New Century are also officers and/or directors
of the Advisor and the Distributor.
(4) INVESTMENT TRANSACTIONS
For the six months ended April 30, 2005, the cost of purchases and the proceeds
from sales of securities other than short-term investments and U.S. government
securities were as follows:
- --------------------------------------------------------------------------------------------------------------------
NEW
NEW NEW NEW NEW CENTURY
CENTURY CENTURY CENTURY CENTURY ALTERNATIVE
CAPITAL BALANCED AGGRESSIVE INTERNATIONAL STRATEGIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- --------------------------------------------------------------------------------------------------------------------
Purchases of investment securities ......... $12,341,349 $11,968,746 $ 408,329 $ 8,014,079 $14,573,625
=========== =========== =========== =========== ===========
Proceeds from sales of investment securities $13,767,138 $13,840,771 $ 835,472 $ -- $ 1,590,926
=========== =========== =========== =========== ===========
- --------------------------------------------------------------------------------------------------------------------
(5) TAX MATTERS
It is each Portfolio'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 Portfolio so
qualifies and distributes at least 90% of its taxable net income, the Portfolio
(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 Portfolio'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.
29
NEW CENTURY PORTFOLIOs
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
The tax character of distributable earnings (deficit) at April 30, 2005 was as
follows:
- --------------------------------------------------------------------------------------------------------------------
NEW
NEW NEW NEW NEW CENTURY
CENTURY CENTURY CENTURY CENTURY ALTERNATIVE
CAPITAL BALANCED AGGRESSIVE INTERNATIONAL STRATEGIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- --------------------------------------------------------------------------------------------------------------------
Accumulated ordinary income ................ $ 74,083 $ 68,337 $ 251 $ 71,414 $ 133,261
Unrealized appreciation .................... 13,195,337 7,564,042 759,851 6,016,868 4,826,337
Capital loss carryforwards ................. (13,589,122) (5,710,786) (1,510,803) -- --
Other gains ................................ 3,645,123 2,000,718 136,281 150,130 221,017
----------- ----------- ----------- ----------- -----------
Total distributable earnings (deficit) ..... $ 3,325,421 $ 3,922,311 $ (614,420) $ 6,238,412 $ 5,180,615
=========== =========== =========== =========== ===========
- --------------------------------------------------------------------------------------------------------------------
The following information is based upon the federal income tax cost of
investment securities as of April 30, 2005:
- --------------------------------------------------------------------------------------------------------------------
NEW
NEW NEW NEW NEW CENTURY
CENTURY CENTURY CENTURY CENTURY ALTERNATIVE
CAPITAL BALANCED AGGRESSIVE INTERNATIONAL STRATEGIES
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- --------------------------------------------------------------------------------------------------------------------
Gross unrealized appreciation .............. $13,530,384 $ 8,072,835 $ 827,796 $ 6,178,255 $ 5,934,350
Gross unrealized depreciation .............. (335,047) (508,793) (67,945) (161,387) (1,108,013)
----------- ----------- ----------- ----------- -----------
Net unrealized appreciation ................ $13,195,337 $ 7,564,042 $ 759,851 $ 6,016,868 $ 4,826,337
=========== =========== =========== =========== ===========
Federal income tax cost .................... $90,158,861 $65,987,232 $ 4,539,813 $28,487,021 $60,059,526
=========== =========== =========== =========== ===========
- --------------------------------------------------------------------------------------------------------------------
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for New Century Balanced, Aggressive and
Alternative Strategies Portfolios is due to certain timing differences in the
recognition of capital losses under income tax regulations and accounting
principles generally accepted in the United States of America. These "book/tax"
differences are temporary in nature and are primarily due to the tax deferral of
losses on wash sales.
As of October 31, 2004, the Portfolios had the following capital loss
carryforwards for federal income tax purposes. These capital loss carryforwards
may be utilized in the current and future years to offset net realized capital
gains, if any, prior to distributing such gains to shareholders.
- --------------------------------------------------------------------------------
NEW NEW NEW
CENTURY CENTURY CENTURY
CAPITAL BALANCED AGGRESSIVE
EXPIRES OCTOBER 31, PORTFOLIO PORTFOLIO PORTFOLIO
- --------------------------------------------------------------------------------
2009 ....................... $ 1,052,258 $ 829,745 $ --
2010 ....................... 9,405,834 4,737,511 1,394,145
2011 ....................... 3,131,030 143,530 116,658
----------- ---------- ----------
$13,589,122 $5,710,786 $1,510,803
=========== ========== ==========
- --------------------------------------------------------------------------------
30
NEW CENTURY PORTFOLIOS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
APRIL 30, 2005 (UNAUDITED)
================================================================================
(6) CONTINGENCIES AND COMMITMENTS
New Century indemnifies its officers and trustees for certain liabilities that
might arise from their performance of their duties to the Portfolios.
Additionally, in the normal course of business, New Century, on behalf of its
Portfolios, enters into contracts that contain a variety of representations and
warranties and which provide general indemnifications. The Portfolios' maximum
exposure under these arrangements is unknown, as this would involve future
claims that may be made against the Portfolios that have not yet occurred.
However, based on experience, New Century expects the risk of loss to be remote.
31
NEW CENTURY PORTFOLIOS
ABOUT YOUR PORTFOLIO'S EXPENSES (UNAUDITED)
================================================================================
We believe it is important for you to understand the impact of costs on your
investment. As a shareholder of the Portfolios, you may incur two types of
costs: (1) transaction costs, including redemption fees; and (2) ongoing costs,
including management fees, distribution (i.e. 12b-1) fees and other fund
expenses. The following examples are intended to help you understand your
ongoing costs (in dollars) of investing in the Portfolios and to compare these
costs with the ongoing costs of investing in other mutual funds.
A fund's expenses are expressed as a percentage of its average net assets. This
figure is known as the expense ratio. The examples in the tables below are based
on an investment of $1,000 made at the beginning of the period shown and held
for the entire period.
The table below illustrates each Portfolio's costs in two ways:
ACTUAL FUND RETURN - This section helps you to estimate the actual expenses that
you paid over the period. The "Ending Account Value" shown is derived from each
Portfolio's actual return, and the third column shows the dollar amount of
operating expenses that would have been paid by an investor who started with
$1,000 in the Portfolios. You may use the information here, together with the
amount you invested, to estimate the expenses that you paid over the period.
To do so, simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
given for the Portfolios under the heading "Expenses Paid During Period."
HYPOTHETICAL 5% RETURN - This section is intended to help you compare the
Portfolios' costs with those of other mutual funds. It assumes that each
Portfolio had an annual return of 5% before expenses during the period shown,
but that the expense ratio is unchanged. In this case, because the return used
is not the Portfolios' actual returns, the results do not apply to your
investment. The example is useful in making comparisons because the Securities
and Exchange Commission requires all mutual funds to calculate expenses based on
a 5% return. You can assess each Portfolio's costs by comparing this
hypothetical example with the hypothetical examples that appear in shareholder
reports of other funds.
Note that expenses shown in the table are meant to highlight and help you
compare ongoing costs only. The Portfolios do not charge sales loads. However, a
redemption fee of 2% is applied on the sale of shares of the Portfolios held for
less than 30 days.
The calculations assume no shares were bought or sold during the period. Your
actual costs may have been higher or lower, depending on the amount of your
investment and the timing of any purchases or redemptions.
32
NEW CENTURY PORTFOLIOS
ABOUT YOUR PORTFOLIO'S EXPENSES (UNAUDITED)
================================================================================
More information about the Portfolios' expenses, including recent annual expense
ratios, can be found in this report. For additional information on operating
expenses and other shareholder costs, please refer to the Portfolios'
prospectus.
NEW CENTURY CAPITAL PORTFOLIO
- --------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
November 1, 2004 April 30, 2005 During Period*
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,028.40 $6.84
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,018.05 $6.80
- --------------------------------------------------------------------------------
* Expenses are equal to the New Century Capital Portfolio's annualized
expense ratio of 1.36% for the period, multiplied by the average account
value over the period, multiplied by 181/365 (to reflect the one-half year
period).
NEW CENTURY BALANCED PORTFOLIO
- --------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
November 1, 2004 April 30, 2005 During Period*
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,027.40 $7.09
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,017.80 $7.05
- --------------------------------------------------------------------------------
* Expenses are equal to the New Century Balanced Portfolio's annualized
expense ratio of 1.41% for the period, multiplied by the average account
value over the period, multiplied by 181/365 (to reflect the one-half year
period).
NEW CENTURY AGGRESSIVE PORTFOLIO
- --------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
November 1, 2004 April 30, 2005 During Period*
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,049.30 $7.62
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,017.36 $7.50
- --------------------------------------------------------------------------------
* Expenses are equal to the New Century Aggressive Portfolio's annualized
expense ratio of 1.50% for the period, multiplied by the average account
value over the period, multiplied by 181/365 (to reflect the one-half year
period).
33
NEW CENTURY PORTFOLIOS
ABOUT YOUR PORTFOLIO'S EXPENSES (UNAUDITED)
================================================================================
NEW CENTURY INTERNATIONAL PORTFOLIO
- --------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
November 1, 2004 April 30, 2005 During Period*
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $ 1,101.30 $7.82
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $ 1,017.36 $7.50
- --------------------------------------------------------------------------------
* Expenses are equal to the New Century International Portfolio's annualized
expense ratio of 1.50% for the period, multiplied by the average account
value over the period, multiplied by 181/365 (to reflect the one-half year
period).
NEW CENTURY ALTERNATIVE STRATEGIES PORTFOLIO
- --------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
November 1, 2004 April 30, 2005 During Period*
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $ 1,031.20 $5.34
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $ 1,019.54 $5.31
- --------------------------------------------------------------------------------
* Expenses are equal to the New Century Alternative Strategies Portfolio's
annualized expense ratio of 1.06% for the period, multiplied by the average
account value over the period, multiplied by 181/365 (to reflect the
one-half year period).
34
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================================================================================
INVESTMENT ADVISOR AND ADMINISTRATOR
Weston Financial Group, Inc.
Wellesley, MA
DISTRIBUTOR
Weston Securities Corporation
Wellesley, MA
COUNSEL
Greenburg Traurig, LLP
Philadelphia, PA
INDEPENDENT ACCOUNTANTS
Briggs, Bunting and Dougherty, LLP
Philadelphia, PA
TRANSFER AGENT
Ultimus Fund Solutions, LLC
Cincinnati, OH
CUSTODIAN
U.S. Bank, N.A.
Cincinnati, OH
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the Portfolios. This report is
authorized for distribution to prospective investors in the Portfolios only if
preceded or accompanied by an effective Prospectus which contains details
concerning the management fee expense and other pertinent information.
A description of the policies and procedures that the Portfolios use to
determine how to vote proxies relating to portfolio securities is available
without charge upon request by calling toll-free 1-888-639-0102, or on the
Securities and Exchange Commission's (SEC) website at http://www.sec.gov.
Information regarding how the Portfolios voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 is available
without charge upon request by calling toll-free 1-888-639-0102, or on the SEC's
website at http://www.sec.gov.
The Portfolios file a complete listing of portfolio holdings with the SEC for
the first and third quarters of each fiscal year on Form N-Q. The Portfolios'
Form N-Q is available without charge upon request by calling 1-888-639-0102, or
on the SEC's website at http://www.sec.gov. The Portfolios' Form N-Q may be
reviewed and copied at the SEC's Public Reference Room in Washington, DC, or by
calling 1-800-SEC-0330.
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ITEM 2. CODE OF ETHICS.
Not required
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not required
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not required
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable [schedule filed with Item 1]
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 has a standing nominating committee responsible for the selection
and nomination of candidates to serve as trustees of the registrant. Although
the nominating committee expects to be able to find an adequate number of
qualified candidates to serve as trustees, the nominating committee is willing
to consider nominations received from shareholders. Shareholders wishing to
submit a nomination should do so by notifying the Secretary of the registrant,
in writing, at the following address: 40 William Street, Suite 100, Wellesley,
Massachusetts 02481-3902.
ITEM 10. CONTROLS AND PROCEDURES.
(a) Based on their evaluation of the registrant's disclosure controls and
procedures (as defined in Rule 30a-3(c) under the Investment Company Act of
1940) as of a date within 90 days of the filing date of this report, the
registrant's principal executive officer 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.
(b) There were no changes in the registrant's internal control over financial
reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940)
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: Not required
(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
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under
the Act (17 CFR 270.23c-1) sent or given during the period covered by the report
by or on behalf of the registrant to 10 or more persons: Not applicable
(b) Certifications required by Rule 30a-2(b) under the Act (17 CFR
270.30a-2(b)): Attached hereto
Exhibit 99.CERT Certifications required by Rule 30a-2(a) under the Act
Exhibit 99.906CERT Certifications required by Rule 30a-2(b) under the Act
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) New Century Portfolios
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By (Signature and Title)* /s/ Wayne M. Grzecki
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Wayne M. Grzecki, President
Date July 1, 2005
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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/ Wayne M. Grzecki
--------------------------------------------
Wayne M. Grzecki, President
Date July 1, 2005
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By (Signature and Title)* /s/ Nicole M. Tremblay
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Nicole M. Tremblay, Treasurer
Date July 1, 2005
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* Print the name and title of each signing officer under his or her signature.