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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-05685
-------------------------------
WILLIAMSBURG INVESTMENT TRUST
(Exact name of registrant as specified in charter)
225 Pictoria Drive, Suite 450 Cincinnati, Ohio 45246
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
W. Lee H. Dunham, Esq.
Sullivan & Worcester LLP One Post Office Square Boston, MAssachusetts 02109
---------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (513) 587-3400
---------------------------
Date of fiscal year end: March 31, 2008
---------------------------------------------
Date of reporting period: September 30, 2007
---------------------------------------------
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
THE DAVENPORT EQUITY FUND
LETTER TO SHAREHOLDERS OCTOBER 31, 2007
================================================================================
Dear Shareholders,
The following chart represents The Davenport Equity Fund's performance and the
performance of the S&P 500 Index, the Fund's primary benchmark, for the periods
ended September 30, 2007.
Since Inception ** Gross
Q3 2007 1 Year 3 Years** 5 Years** (1/15/98) Expense Ratio
---------------------------------------------------------------------------------
DAVPX 5.27% 21.48% 13.96% 14.74% 6.52% 0.97%
S&P 500* 2.03% 16.44% 13.14% 15.45% 6.68%
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA QUOTED. PERFORMANCE
DATA, CURRENT TO THE MOST RECENT MONTH END, MAY BE OBTAINED BY CALLING
1-888-285-1863.
* The S&P 500 Index is comprised of 500 U.S. stocks and is an indicator of
the performance of the overall U.S. stock market. An investor cannot
invest in an index and its returns are not indicative of the performance
of any specific investment.
** Annualized.
MARKET COMMENTARY
By the middle of this past July, very few would have predicted positive returns
for the quarter in major equity indexes. The results, however, belie the
volatility and fear which took hold during the quarter. At the end of June,
sub-prime mortgage defaults and the rippling impact of the financial vehicles
which contained them fueled anxiety reminiscent of the savings and loan crisis
in the 1980's. Credit markets were thrown into a deep freeze and even the most
seasoned observer of the financial markets was not sure how devastating the bear
attack might be.
Down 586 points, the final week of July was the worst in several years for the
Dow. Headlines swirled around the viability of Bear Stearns as rumors of
mounting losses in hedge funds ran across the tape. The market saw swings of
several percentage points during single sessions as liquidity needs, largely
from leveraged hedge funds, caused selling of any stocks which could be sold. It
was becoming clear that this dramatic volatility was being driven by anything
but fundamental investment decisions. The Fed held the Federal Funds target rate
steady following the August meeting, in spite of calls for them to lower rates
to help stabilize the credit markets. Eight trading days later as the equity
markets fell through the magical 10% correction from the peak, the Fed cut the
discount rate fifty basis points to inject liquidity, acknowledging that they
were aware that market participants were talking themselves into a crisis.
Late in September, all eyes turned to the earnings reports of the investment
banks which were at the center of the storm. Many of their hedge fund clients
endured gut wrenching quarters, suffering significant losses that were hard for
anyone to quantify. Their own funds made headlines as market volatility,
multiplied by leverage, subjected them to untimely margin calls. The banks,
themselves committed to finance many leveraged buyouts, suddenly could find no
home for the debt. How bad had the credit crisis gotten during the quarter? Bad
enough; but to investors' relief they made it through the period in pretty good
shape. Goldman Sachs, in particular, beat
1
the consensus estimates by roughly 40%. Despite the turmoil, good risk
management and profiting from others' pain enabled Goldman and a few others to
navigate this storm without taking on too much water.
In spite of the roiled equity and credit fronts, the third quarter was anything
but devastating for equities with the S&P 500 up 2.03%, the Lipper Equity Income
Index up 0.07% and the Russell Midcap Index down slightly at -0.39%. The Fund
fared well throughout, ending in positive territory and ahead of its respective
benchmark for the second and third quarters, as well as the calendar year to
date.
A significant mitigating factor for the investment banks was global diversity.
Over the last several years, these companies have expanded to overseas markets
where concerns of sub-prime mortgage defaults are much less acute. During the
latest earnings calls, managements highlighted international operations'
significant contribution and voiced their intention to expand this business in
the future.
The benefits of global diversity were in the limelight in the second quarter as
many larger companies reported first quarter earnings, which analysts had
expected to be lower after anemic domestic economic growth. The strong earnings
reported by companies with overseas operations turned attention away from
lackluster domestic results and reminded analysts of the benefits of
international exposure. Reported second quarter results confirmed this trend and
these sleepy behemoths began to capture investors' attention.
Many companies have been expanding their reach overseas in recent years. Intel
has increased its percentage of international sales to over 80%. An allocation
to international exposure would be hard to avoid if we tried. As a matter of
fact, when analyzing the overall sales of the Fund's companies at the end of
last year, roughly 44% of the sales for the portfolio have come from abroad.
This figure is sure to grow as the world continues to shrink.
It is not only companies with business units overseas that are benefiting from
strong global economies. Many foreigners come to the U.S. to spend their
relatively strong currencies. The effects can be felt in retail, lodging,
entertainment and other industries that cater to foreign travelers, propping up
demand for goods and services during a time when our economy is slowing.
Additionally, many domestic producers are exporting more of their goods in light
of strong global demand bolstered by the relatively weak dollar. According to
the Commerce Department, of the 3.8% GDP growth in the second quarter, net
exports were the largest contributor at 1.3% ahead of consumer spending, which
has been the source of so much concern. As a result, many companies are citing
this extra demand as a reason to keep more people at work than they had in
previous periods of soft growth. As much as there is a tendency to focus on
negative trends domestically, the benefits of maturing economies fueling the
global economy are hard to ignore. The reality of global interdependence has
been amply recognized by the market and is a big reason stocks rebounded in such
short order.
We are pleased with our performance so far this year. We continue to search for
individual investments to incorporate into the Fund and closely monitor those
that we own. We look forward to reporting our progress to you in early 2008, but
are available anytime to discuss our results and thoughts with you. Thank you
for your trust.
THE FUND
The Davenport Equity Fund finished the first half of its fiscal year (March 31 -
September 30) up over 13% on strength in Telecommunications, Information
Technology and Materials. Even the Financials sector, weakened by news of the
sub-prime mortgage fallout, managed to avoid catastrophe as the Fed's well-timed
rate cut helped rally the market late in the third quarter. The real news for
the Fund was not the contribution of any particular sector, but the breadth of
the rally. To illustrate, the Fund's five best stocks for the first half of the
year represented four market different market sectors: Telecommunications,
Energy, Materials, and two from Technology, while only one sector, Consumer
Discretionary, ended the first half of the year in the red.
2
A major factor in outperforming stocks continues to be exposure to global
sources of revenue. Four of the five top-contributing stocks to the Fund's
semi-annual performance were internationally-based: telecommunication giant
China Mobile, French driller Schlumberger, British mining giant Rio Tinto and
Finnish cell phone technology company Nokia. As a weaker dollar and slowing
housing markets hamper domestic firms and squeeze U.S. consumers, foreign
investment seems increasingly attractive. Relatively strong foreign currencies
spur international investment in U.S. markets, intertwining and creating a
global marketplace.
There was also some weakness in the portfolio, primarily from two sources:
consumer discretionary stocks and health care. Domestic consumer spending is
unsurprisingly weaker as a cooling housing market cannot generate easy and
inexpensive home equity lines of credit to supplement income. CarMax cited a
slowdown in its markets and declined over 20% during the third quarter. We
believe, however, that the long-term prospects for this franchise outweigh the
risks of such near term volatility, and we continue to own the stock. Lowe's and
Omnicom also hindered our performance, but we believe that in time these stocks
will reward patient investors. We will also keep an eye on a number of companies
in this sector as declining stock prices are tempting if the associated risk
moderates.
Most health care stocks have been sluggish at best. With the Federal election
cycle looming and political frontrunners trotting out a wide array of "fixes" to
our inflation plagued health care system, the rally has bypassed most of the
group. Fear of price controls, generic competition and an increasingly complex
regulatory environment may weigh on this industry until after next November.
While we believe that there is untapped value inherent in a number of health
care stocks and have initiated new positions during the quarter, we remain
slightly underweighted in our exposure to the group relative to the broader
markets.
RECENT PURCHASES
CVS CAREMARK CORP. (CVS) operates about 6,200 stores and specializes in
integrated pharmacy services. It is the leading provider of prescription drugs
in the U.S., filling over a billion prescriptions annually. We expect robust
earnings growth and believe that an aging U.S. population offers significant
potential growth to pharmaceutical distribution companies. CVS stores have
reported favorable same store sales recently, indicating that its recent
acquisitions will contribute to earnings growth and are on track to be accretive
by the end of the year.
INTERNATIONAL BUSINESS MACHINES CORP. (IBM) is the world's largest information
technology services and software company. A positive outlook for corporate IT
spending should lift the sector overall, but IBM, with a commanding global
presence, particularly in emerging markets, is poised to gain market share as it
continues to improve and expand services to existing clients. Earnings are
projected to grow at double digit rates during the next few years and the
company will continue to generate impressive free cash flow, which should help
maintain or accelerate the current share repurchase program.
JPMORGAN CHASE & CO. (JPM) is a global investment banking and financial services
company. The financial services industry has been weak this year due to the
effect of sub-prime mortgage fallout and the ensuing spillover into the
corporate debt market. However, in spite of a slightly weak third quarter,
JPMorgan's full year earnings are not expected to be significantly impacted and
we believe recent weakness in the stock has been overdone. Recent acquisitions
in consumer banking operations along with strong investment banking, asset
management and private equity revenues should help offset losses stemming from
the weaker credit markets. Finally, we believe that a focused management team
should be able to capitalize on current conditions to expand and improve its
core businesses and drive significant earnings growth.
3
MILLICOM INTERNATIONAL CELLULAR S.A. (MICC) is a global mobile
telecommunications operator with concentrated operations in Latin America, Asia
and Africa. Millicom competes effectively in Central and Latin America, owning
the number one position in three of the six markets served and the number two
position in two markets. Additionally, the company's innovation has allowed them
to be first to market with per-second prepaid wireless billing as well as E-Pin
electronic replenishment for prepaid phones. Both initiatives have boosted
revenues as well as market share in the regions offered. Subscriber penetration
in each of Millicom's markets remains relatively low, which we believe lends
significant growth opportunities for Millicom.
OWENS & MINOR INC. (OMI) is the largest medical and surgical supply company
catering to hospitals in the United States. A recently completed acquisition of
a complementary business from rival McKesson has boosted revenue growth and
increased sales volume. A direct-to-consumer diabetes supply business it also
acquired has grown its operating margins and generates a healthy profit. By
paying down debt and solidifying its balance sheet, Owens & Minor is in a
position to expand its area of operation or seek new business opportunities
through further acquisitions.
WYETH (WYE) is a leading pharmaceutical manufacturer of prescription and
over-the-counter medicines, including brand names Advil, Robitussin, Prevnar and
Enbrel, among others. Its Alzheimer's program addresses a growing problem with a
potentially revolutionary treatment regimen. It has launched an aggressive
cost-cutting program which should expand margins, and strategic alliances with
other major pharmaceutical companies may be an appealing option for management
and shareholders alike.
Sincerely,
Joseph L. Antrim, III
President
Davenport Equity Fund
AN INVESTOR SHOULD CONSIDER THE INVESTMENT OBJECTIVES, RISKS, CHARGES AND
EXPENSES OF THE FUND CAREFULLY BEFORE INVESTING. THE FUND'S PROSPECTUS CONTAINS
THIS AND OTHER IMPORTANT INFORMATION. TO OBTAIN A COPY OF THE FUND'S PROSPECTUS
PLEASE CALL 1-888-285-1863 AND A COPY WILL BE SENT TO YOU FREE OF CHARGE. PLEASE
READ THE PROSPECTUS CAREFULLY BEFORE YOU INVEST.
THE LETTER TO SHAREHOLDERS SEEKS TO DESCRIBE SOME OF THE ADVISER'S CURRENT
OPINIONS AND VIEWS OF THE FINANCIAL MARKETS. ALTHOUGH THE ADVISER BELIEVES IT
HAS A REASONABLE BASIS FOR ANY OPINIONS OR VIEWS EXPRESSED, ACTUAL RESULTS MAY
DIFFER, SOMETIMES SIGNIFICANTLY SO, FROM THOSE EXPECTED OR EXPRESSED. THE
DISCUSSION OF PARTICULAR SECURITIES SHOULD NOT BE CONSIDERED A RECOMMENDATION BY
THE ADVISER.
4
THE DAVENPORT EQUITY FUND
PERFORMANCE INFORMATION (UNAUDITED)
================================================================================
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN
THE DAVENPORT EQUITY FUND AND THE STANDARD & POOR'S 500 INDEX
[LINE GRAPH OMITTED]
STANDARD & POOR'S 500 INDEX THE DAVENPORT EQUITY FUND
- ---------------------------- ----------------------------
DATE VALUE DATE VALUE
---- ------- ---- -------
01/15/98 $ 10,000 01/15/98 $ 10,000
03/31/98 11,625 03/31/98 11,140
06/30/98 12,009 06/30/98 11,295
09/30/98 10,814 09/30/98 9,950
12/31/98 13,118 12/31/98 11,519
03/31/99 13,771 03/31/99 12,090
06/30/99 14,742 06/30/99 12,709
09/30/99 13,821 09/30/99 11,920
12/31/99 15,878 12/31/99 13,321
03/31/00 16,242 03/31/00 13,894
06/30/00 15,810 06/30/00 13,456
09/30/00 15,657 09/30/00 13,330
12/31/00 14,432 12/31/00 13,226
03/31/01 12,721 03/31/01 11,580
06/30/01 13,466 06/30/01 11,966
09/30/01 11,489 09/30/01 10,738
12/31/01 12,717 12/31/01 11,706
03/31/02 12,752 03/31/02 11,915
06/30/02 11,043 06/30/02 10,913
09/30/02 9,136 09/30/02 9,288
12/31/02 9,906 12/31/02 9,801
03/31/03 9,594 03/31/03 9,453
06/30/03 11,071 06/30/03 10,784
09/30/03 11,364 09/30/03 11,204
12/31/03 12,748 12/31/03 12,272
03/31/04 12,964 03/31/04 12,640
06/30/04 13,187 06/30/04 12,677
09/30/04 12,941 09/30/04 12,479
12/31/04 14,135 12/31/04 13,674
03/31/05 13,832 03/31/05 13,514
06/03/05 14,021 06/03/05 13,535
09/30/05 14,526 09/30/05 14,003
12/31/05 14,829 12/31/05 14,302
03/31/06 15,453 03/31/06 14,795
06/30/06 15,231 06/30/06 14,612
09/30/06 16,094 09/30/06 15,203
12/31/06 17,172 12/31/06 16,158
03/31/07 17,282 03/31/07 16,279
06/30/07 18,367 06/30/07 17,544
09/30/07 18,739 09/30/07 18,468
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for periods ended September 30, 2007)
1 YEAR 5 YEARS SINCE INCEPTION*
The Davenport Equity Fund 21.48% 14.74% 6.52%
Standard & Poor's 500 Index 16.44% 15.45% 6.68%
- --------------------------------------------------------------------------------
* Initial public offering of shares was January 15, 1998.
(a) The total returns shown do not reflect the deduction of taxes that a
shareholder would pay on Fund distributions or the redemption of Fund
shares.
5
THE DAVENPORT EQUITY FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
SECTOR CONCENTRATION VS. THE STANDARD & POOR'S 500 INDEX
[BAR CHART OMITTED]
(% of Net Assets)
The Standard &
Davenport Equity Poor's 500
Fund Index
---------------- -------
Consumer Discretionary 6.1% 9.2%
Consumer Staples 13.3% 9.5%
Energy 11.9% 11.7%
Financials 19.1% 19.8%
Health Care 9.8% 11.7%
Industrials 11.8% 11.5%
Information Technology 16.0% 16.2%
Materials 4.2% 3.2%
Telecommunications Services 5.8% 3.8%
Utilities 0.0% 3.4%
Cash Equivalents 2.0% 0.0%
TOP TEN HOLDINGS
% OF
SECURITY DESCRIPTION NET ASSETS
- --------------------------------------- ----------
General Electric Company 3.4%
Schlumberger Ltd. 2.7%
Markel Corporation 2.7%
United Technologies Corporation 2.4%
China Mobile Ltd. 2.4%
Danaher Corporation 2.3%
Praxair, Inc. 2.2%
ConocoPhillips 2.2%
Exxon Mobil Corporation 2.2%
Capital One Financial Corporation 2.1%
6
THE DAVENPORT EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2007 (UNAUDITED)
==============================================================================================================
ASSETS
Investments in securities:
At acquisition cost ...................................................................... $ 124,018,588
=============
At market value (Note 1) ................................................................. $ 168,467,726
Dividends receivable ....................................................................... 107,903
Receivable for investment securities sold .................................................. 2,859,500
Receivable for capital shares sold ......................................................... 88,222
Other assets ............................................................................... 17,805
-------------
TOTAL ASSETS ............................................................................. 171,541,156
-------------
LIABILITIES
Payable for investment securities purchased ................................................ 1,954,851
Payable for capital shares redeemed ........................................................ 197,673
Accrued investment advisory fees (Note 3) .................................................. 110,368
Accrued administration fees (Note 3) ....................................................... 18,000
Accrued compliance fees (Note 3) ........................................................... 1,750
Other accrued expenses and liabilities ..................................................... 14,774
-------------
TOTAL LIABILITIES ........................................................................ 2,297,416
-------------
NET ASSETS .................................................................................... $ 169,243,740
=============
Net assets consist of:
Paid-in capital ............................................................................... $ 111,911,189
Distributions in excess of net investment income .............................................. (4,227)
Accumulated net realized gains from security transactions ..................................... 12,887,640
Net unrealized appreciation on investments .................................................... 44,449,138
-------------
Net assets .................................................................................... $ 169,243,740
=============
Shares of beneficial interest outstanding (unlimited number of shares authorized, no par value) 10,148,618
=============
Net asset value, offering price and redemption price per share (Note 1) ....................... $ 16.68
=============
See accompanying notes to financial statements.
7
THE DAVENPORT EQUITY FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
INVESTMENT INCOME
Dividends ....................................................... $ 1,304,951
-----------
EXPENSES
Investment advisory fees (Note 3) ............................... 604,140
Administration fees (Note 3) .................................... 108,394
Compliance service fees (Note 3) ................................ 11,251
Custodian fees .................................................. 9,783
Printing of shareholder reports ................................. 9,381
Professional fees ............................................... 7,371
Trustees' fees and expenses ..................................... 6,497
Registration fees ............................................... 6,358
Postage and supplies ............................................ 5,287
Insurance expense ............................................... 4,645
Other expenses .................................................. 9,914
-----------
TOTAL EXPENSES ................................................ 783,021
-----------
NET INVESTMENT INCOME .............................................. 521,930
-----------
REALIZED AND UNREALIZED GAINS ON INVESTMENTS
Net realized gains from security transactions ................... 8,223,570
Net change in unrealized appreciation/depreciation on investments 11,551,707
-----------
NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS ................... 19,775,277
-----------
NET INCREASE IN NET ASSETS FROM OPERATIONS ......................... $20,297,207
===========
See accompanying notes to financial statements.
8
THE DAVENPORT EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
===================================================================================================
SIX MONTHS
ENDED YEAR
SEPT. 30, ENDED
2007 MARCH 31,
(UNAUDITED) 2007
- ---------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ........................................... $ 521,930 $ 999,836
Net realized gains from security transactions ................... 8,223,570 10,206,688
Net change in unrealized appreciation/depreciation on investments 11,551,707 2,884,979
------------- -------------
Net increase in net assets from operations ......................... 20,297,207 14,091,503
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ...................................... (528,965) (1,012,305)
From net realized capital gains on security transactions ........ -- (5,238,825)
------------- -------------
Net decrease in net assets from distributions to shareholders ...... (528,965) (6,251,130)
------------- -------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ....................................... 8,050,488 11,901,066
Net asset value of shares issued in
reinvestment of distributions to shareholders ................. 499,864 5,939,200
Payments for shares redeemed .................................... (10,729,954) (22,948,178)
------------- -------------
Net decrease in net assets from capital share transactions ......... (2,179,602) (5,107,912)
------------- -------------
TOTAL INCREASE IN NET ASSETS ....................................... 17,588,640 2,732,461
NET ASSETS
Beginning of period ............................................. 151,655,100 148,922,639
------------- -------------
End of period ................................................... $ 169,243,740 $ 151,655,100
============= =============
UNDISTRIBUTED (DISTRIBUTIONS IN EXCESS OF)
NET INVESTMENT INCOME ........................................... $ (4,227) $ 2,808
============= =============
CAPITAL SHARE ACTIVITY
Sold ............................................................ 515,102 830,191
Reinvested ...................................................... 31,139 416,381
Redeemed ........................................................ (682,278) (1,606,678)
------------- -------------
Net decrease in shares outstanding .............................. (136,037) (360,106)
Shares outstanding at beginning of period ....................... 10,284,655 10,644,761
------------- -------------
Shares outstanding at end of period ............................. 10,148,618 10,284,655
============= =============
See accompanying notes to financial statements.
9
THE DAVENPORT EQUITY FUND
FINANCIAL HIGHLIGHTS
==================================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- ----------------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 ----------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 14.75 $ 13.99 $ 13.08 $ 12.30 $ 9.23 $ 11.71
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................ 0.05 0.10 0.07 0.07 0.04 0.06
Net realized and unrealized gains
(losses) on investments ............ 1.93 1.28 1.17 0.78 3.07 (2.48)
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ 1.98 1.38 1.24 0.85 3.11 (2.42)
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income . (0.05) (0.10) (0.07) (0.07) (0.04) (0.06)
Distributions from net realized gains
on security transactions ........... -- (0.52) (0.26) -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.05) (0.62) (0.33) (0.07) (0.04) (0.06)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 16.68 $ 14.75 $ 13.99 $ 13.08 $ 12.30 $ 9.23
========== ========== ========== ========== ========== ==========
Total return (a) ........................ 13.45% (b) 10.02% 9.48% 6.91% 33.72% (20.66%)
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 169,244 $ 151,655 $ 148,923 $ 138,181 $ 121,769 $ 76,473
========== ========== ========== ========== ========== ==========
Ratio of expenses to average net assets . 0.97% (c) 0.98% 0.98% 0.98% 1.00% 1.04%
Ratio of net investment income to
average net assets ................... 0.65% (c) 0.67% 0.50% 0.57% 0.35% 0.62%
Portfolio turnover rate ................. 23% (b) 26% 39% 28% 25% 18%
(a) Total returns are a measure of the change in value of an investment in the
Fund over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Fund. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(b) Not annualized.
(c) Annualized.
See accompanying notes to financial statements.
10
THE DAVENPORT EQUITY FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
==========================================================================================================
SHARES COMMON STOCKS -- 98.0% VALUE
- ----------------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 6.1%
110,572 CarMax, Inc. (a)......................................................... $ 2,247,929
56,400 Comcast Corporation (a).................................................. 1,363,752
68,354 Lowe's Companies, Inc. .................................................. 1,915,279
52,350 Omnicom Group, Inc....................................................... 2,517,512
68,925 PetSmart, Inc. .......................................................... 2,198,708
--------------
10,243,180
--------------
CONSUMER STAPLES -- 13.3%
45,184 Colgate-Palmolive Company................................................ 3,222,523
69,525 CVS Caremark Corporation................................................. 2,755,276
75,000 Kraft Foods, Inc......................................................... 2,588,250
44,000 PepsiCo, Inc............................................................. 3,223,440
36,375 Procter & Gamble Company (The)........................................... 2,558,617
53,800 Smithfield Foods, Inc. (a)............................................... 1,694,700
100,166 Sysco Corporation........................................................ 3,564,908
62,555 Walgreen Company......................................................... 2,955,098
--------------
22,562,812
--------------
ENERGY -- 11.9%
35,700 Chevron Corporation...................................................... 3,340,806
42,015 ConocoPhillips........................................................... 3,687,656
25,276 EOG Resources, Inc....................................................... 1,828,213
39,716 Exxon Mobil Corporation.................................................. 3,676,113
39,494 GlobalSantaFe Corporation................................................ 3,002,334
43,517 Schlumberger Ltd......................................................... 4,569,285
--------------
20,104,407
--------------
FINANCIALS -- 19.1%
48,883 American International Group, Inc. ...................................... 3,306,935
48,700 Bank of America Corporation.............................................. 2,448,149
60,614 BB&T Corporation......................................................... 2,448,199
883 Berkshire Hathaway, Inc. - Class B (a)................................... 3,489,616
62,537 Brookfield Asset Management, Inc......................................... 2,407,674
53,914 Capital One Financial Corporation........................................ 3,581,507
11,175 Goldman Sachs Group, Inc. (The).......................................... 2,422,070
29,850 Hartford Financial Services Group, Inc. (The)............................ 2,762,618
42,350 JPMorgan Chase & Company................................................. 1,940,477
9,347 Markel Corporation (A)................................................... 4,523,948
53,099 T. Rowe Price Group, Inc................................................. 2,957,083
--------------
32,288,276
--------------
HEALTH CARE -- 9.8%
41,750 Allergan, Inc............................................................ 2,691,622
47,234 Eli Lilly & Company...................................................... 2,689,032
42,502 Johnson & Johnson........................................................ 2,792,381
83,450 Owens & Minor, Inc....................................................... 3,178,611
51,325 Wyeth.................................................................... 2,286,529
35,967 Zimmer Holdings, Inc. (a)................................................ 2,912,967
--------------
16,551,142
--------------
11
THE DAVENPORT EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
==========================================================================================================
SHARES COMMON STOCKS -- 98.0% (CONTINUED) VALUE
- ----------------------------------------------------------------------------------------------------------
INDUSTRIALS -- 11.8%
47,240 Danaher Corporation...................................................... $ 3,907,220
137,516 General Electric Company................................................. 5,693,162
29,169 L-3 Communications Holdings, Inc. ....................................... 2,979,322
44,071 United Parcel Service, Inc. - Class B.................................... 3,309,732
51,428 United Technologies Corporation.......................................... 4,138,926
--------------
20,028,362
--------------
INFORMATION TECHNOLOGY -- 16.0%
19,847 Apple Computer, Inc. (a)................................................. 3,047,308
100,000 Corning, Inc. ........................................................... 2,465,000
5,265 Google, Inc. (a)......................................................... 2,986,677
106,600 Intel Corporation........................................................ 2,756,676
21,175 International Business Machines Corporation.............................. 2,494,415
100,123 Microsoft Corporation.................................................... 2,949,624
71,251 Nokia Oyj - ADR.......................................................... 2,702,550
122,400 Oracle Corporation (a)................................................... 2,649,960
46,900 SanDisk Corporation (a).................................................. 2,584,190
65,475 Texas Instruments, Inc................................................... 2,395,730
--------------
27,032,130
--------------
MATERIALS -- 4.2%
44,085 Praxair, Inc. ........................................................... 3,692,560
10,109 Rio Tinto PLC - ADR...................................................... 3,471,430
--------------
7,163,990
--------------
TELECOMMUNICATIONS SERVICES -- 5.8%
51,607 America Movil S.A. de C.V. - Series L - ADR.............................. 3,302,848
49,625 China Mobile Ltd. - ADR.................................................. 4,071,235
29,525 Millicom International Cellular S.A. (a)................................. 2,477,148
--------------
9,851,231
--------------
TOTAL COMMON STOCKS (Cost $121,376,392).................................. $ 165,825,530
--------------
==========================================================================================================
SHARES MONEY MARKET FUNDS -- 1.5% VALUE
- ----------------------------------------------------------------------------------------------------------
2,642,196 First American Treasury Obligations Fund - Class Y (Cost $2,642,196)..... $ 2,642,196
--------------
TOTAL INVESTMENTS AT VALUE -- 99.5% (Cost $124,018,588).................. $ 168,467,726
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.5%............................ 776,014
--------------
NET ASSETS -- 100.0%..................................................... $ 169,243,740
==============
(a) Non-income producing security.
ADR - American Depositary Receipt
See accompanying notes to financial statements.
12
THE DAVENPORT EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The Davenport Equity Fund (the Fund) is a no-load, diversified series of the
Williamsburg Investment Trust (the Trust), an open-end management investment
company registered under the Investment Company Act of 1940. The Trust was
organized as a Massachusetts business trust on July 18, 1988. The Fund began
operations on January 15, 1998.
The Fund's investment objective is long term growth of capital through
investment in a diversified portfolio of common stocks. Current income is
incidental to this objective and may not be significant.
The following is a summary of the Fund's significant accounting policies:
Securities valuation -- The Fund's portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern time). Securities traded on a national stock
exchange are valued based upon the closing price on the principal exchange where
the security is traded. Securities which are quoted by NASDAQ are valued at the
NASDAQ Official Closing Price. Securities which are traded over-the-counter are
valued at the last sales price, if available, otherwise, at the last quoted bid
price. Fixed income securities will ordinarily be traded in the over-the-counter
market and common stocks will ordinarily be traded on a national securities
exchange, but may also be traded in the over-the-counter market. When market
quotations are not readily available, securities may be valued on the basis of
prices provided by an independent pricing service. Short-term instruments (those
with remaining maturities of 60 days or less) are valued at amortized cost,
which approximates market value. Securities and other assets for which no
quotations are readily available or are considered to be unreliable due to
significant market or other events will be valued in good faith at fair value
using methods determined by the Board of Trustees. Such methods of fair
valuation may include, but are not limited to: multiple of earnings, multiple of
book value, discount from market of a similar freely traded security, purchase
price of security, subsequent private transactions in the security or related
securities, or a combination of these and other factors.
Repurchase agreements -- The Fund may enter into joint repurchase agreements
with other funds within the Trust. The joint repurchase agreement, which is
collateralized by U.S. Government obligations, is valued at cost which, together
with accrued interest, approximates market. At the time the Fund enters into the
joint repurchase agreement, the seller agrees that the value of the underlying
securities, including accrued interest, will at all times be equal to or exceed
the face amount of the repurchase agreement. In addition, the Fund actively
monitors and seeks additional collateral, as needed.
Share valuation -- The net asset value per share of the Fund is calculated daily
by dividing the total value of the Fund's assets, less liabilities, by the
number of shares outstanding. The offering price and redemption price per share
of the Fund is equal to the net asset value per share.
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed-income
securities purchased are amortized using the interest method.
Security transactions -- Security transactions are accounted for on trade date.
Gains and losses on securities sold are determined on a specific identification
basis.
Common expenses -- Common expenses of the Trust are allocated among the funds
within the Trust based on relative net assets of each fund or the nature of the
services performed and the relative applicability to each fund.
13
THE DAVENPORT EQUITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Distributions to shareholders -- Dividends arising from net investment income
are declared and paid quarterly to shareholders of the Fund. Net realized
short-term capital gains, if any, may be distributed throughout the year and net
realized long-term capital gains, if any, are distributed at least once each
year. The amount of distributions from net investment income and net realized
gains are determined in accordance with federal income tax regulations which may
differ from accounting principles generally accepted in the United States. The
tax character of distributions paid during the periods ended September 30, 2007
and March 31, 2007 was as follows:
--------------------------------------------------------------------------
PERIOD ENDED ORDINARY INCOME LONG-TERM CAPITAL GAINS TOTAL
--------------------------------------------------------------------------
Sept. 30, 2007 $ 528,965 $ -- $ 528,965
March 31, 2007 $ 1,012,305 $ 5,238,825 $ 6,251,130
--------------------------------------------------------------------------
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates.
Federal income tax -- It is the Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which the Fund
so qualifies and distributes at least 90% of its taxable net income, the Fund
(but not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also the Fund's intention to declare as dividends in
each calendar year at least 98% of its net investment income (earned during the
calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is computed on a tax basis for each item as of
September 30, 2007:
- --------------------------------------------------------------------------------
Cost of portfolio investments .......................... $ 124,322,908
=============
Gross unrealized appreciation .......................... $ 45,511,300
Gross unrealized depreciation .......................... (1,366,482)
-------------
Net unrealized appreciation ............................ $ 44,144,818
Undistributed ordinary income .......................... 1,249,950
Undistributed long-term gains .......................... 11,937,783
-------------
Accumulated earnings ................................... $ 57,332,551
=============
- --------------------------------------------------------------------------------
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for the Fund is due to certain timing differences
in the recognition of capital gains and losses under income tax regulations and
accounting principles generally accepted in the United States. Theses "book/tax"
differences are temporary in nature and are primarily due to the tax deferral of
losses on wash sales.
2. INVESTMENT TRANSACTIONS
During the six months ended September 30, 2007, cost of purchases and proceeds
from sales and maturities of investment securities, other than short-term
investments and U.S. government securities, amounted to $35,124,517 and
$36,274,278, respectively.
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Fund's investments are managed by Davenport & Company LLC (the Adviser)
under the terms of an Investment Advisory Agreement. Under the Investment
Advisory Agreement, the Fund pays the Adviser a fee, which is computed and
accrued daily and paid monthly, at an annual rate of .75% of its average daily
net assets. Certain officers of the Trust are also officers of the Adviser.
14
THE DAVENPORT EQUITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
MUTUAL FUND SERVICES AGREEMENT
Under the terms of a Mutual Fund Services Agreement between the Trust and
Ultimus Fund Solutions, LLC (Ultimus), Ultimus provides administrative, pricing,
accounting, dividend disbursing, shareholder servicing and transfer agent
services for the Fund. For these services, Ultimus receives a monthly fee from
the Fund at an annual rate of .15% on its average daily net assets up to $25
million; .125% on the next $25 million of such net assets; and .10% on such net
assets in excess of $50 million, plus a shareholder recordkeeping fee at the
annual rate of $10 per shareholder account in excess of 1,000 accounts. In
addition, the Fund pays out-of-pocket expenses including, but not limited to,
postage, supplies and costs of pricing the Fund's portfolio securities. Certain
officers of the Trust are also officers of Ultimus, or of Ultimus Fund
Distributors, LLC, the principal underwriter of the Fund's shares and an
affiliate of Ultimus. The Distributor receives no compensation from the Fund for
acting as principal underwriter.
COMPLIANCE CONSULTING AGREEMENT
Under the terms of a Compliance Consulting Agreement between the Trust and
Ultimus, Ultimus provides an individual to serve as the Trust's Chief Compliance
Officer and to administer the Trust's compliance policies and procedures. For
these services, the Fund pays Ultimus an annual base fee of $15,000 plus an
asset-based fee equal to 0.01% per annum on net assets in excess of $100
million.
4. CONTINGENCIES AND COMMITMENTS
The Fund indemnifies the Trust's officers and trustees for certain liabilities
that might arise from their performance of their duties to the Fund.
Additionally, in the normal course of business the Fund enters into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Fund's maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Fund that have not yet occurred. However, based on experience, the Fund expects
the risk of loss to be remote.
5. ACCOUNTING PRONOUNCEMENTS
On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB
Interpretation No. 48 (FIN 48) "Accounting for Uncertainty in Income Taxes." FIN
48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken in the course of preparing the Fund's tax
returns to determine whether the tax positions are "more-likely-than-not" of
being sustained by the applicable tax authority. Tax positions not deemed to
meet the more-likely-than-not threshold would be recorded as a tax benefit or
expense in the current year. Adoption of FIN 48 is required for fiscal years
beginning after December 15, 2006 and is to be applied to all open tax years as
of the effective date. As a result, the Fund has adopted FIN 48 with this
Semi-Annual Report. Based on its analysis, management does not believe that the
adoption of FIN 48 has a material impact on the financial statements.
In September 2006, the Financial Accounting Standards Board issued Statement on
Financial Accounting Standards (SFAS) No. 157, "Fair Value Measurements." This
standard establishes a single authoritative definition of fair value, sets out a
framework for measuring fair value and requires additional disclosures about
fair value measurements. SFAS No. 157 applies to fair value measurements already
required or permitted by existing standards. SFAS No. 157 is effective for
financial statements issued for fiscal years beginning after November 15, 2007
and interim periods within those fiscal years. The changes to current generally
accepted accounting principles from the application of SFAS No. 157 relate to
the definition of fair value, the methods used to measure fair value, and the
expanded disclosures about fair value measurements. As of September 30, 2007,
the Fund does not believe the adoption of SFAS No. 157 will impact the amounts
reported in the financial statements. However, additional disclosures may be
required about the inputs used to develop the measurements and the effect of
certain of the measurements reported on the statement of changes in net assets
for a fiscal period.
15
THE DAVENPORT EQUITY FUND
ABOUT YOUR FUND'S EXPENSES (UNAUDITED)
================================================================================
We believe it is important for you to understand the impact of costs on your
investment. All mutual funds have operating expenses. As a shareholder of the
Fund, you incur ongoing costs, including management fees and other Fund
expenses. Operating expenses, which are deducted from the Fund's gross income,
directly reduce the investment return of the Fund.
A fund's ongoing costs are expressed as a percentage of its average net assets.
This figure is known as the expense ratio. The following examples are intended
to help you understand the ongoing costs (in dollars) of investing in the Fund
and to compare these costs with the ongoing costs of investing in other mutual
funds. The examples 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 the Fund'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 the
Fund'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
Fund. 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 Fund under the heading "Expenses Paid During Period."
Hypothetical 5% return - This section is intended to help you compare the Fund's
costs with those of other mutual funds. It assumes that the Fund 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 Fund's actual
return, 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 the
Fund'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 Fund does not charge transaction fees, such as
purchase or redemption fees, nor does it carry a "sales load."
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.
More information about the Fund's expenses, including historical annual expense
ratios, can be found in this report. For additional information on operating
expenses and other shareholder costs, please refer to the Fund's prospectus.
- --------------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
April 1, 2007 Sept. 30, 2007 During Period*
- --------------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,134.50 $5.19
- --------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,020.21 $4.91
- --------------------------------------------------------------------------------------
* Expenses are equal to the Fund's annualized expense ratio of 0.97% for the
period, multiplied by the average account value over the period,
multiplied by 183/365 (to reflect the one-half year period).
16
THE DAVENPORT EQUITY FUND
OTHER INFORMATION (UNAUDITED)
================================================================================
A description of the policies and procedures that the Fund uses to vote proxies
relating to portfolio securities is available without charge upon request by
calling toll-free 1-800-281-3217, or on the Securities and Exchange Commission's
(SEC) website at http://www.sec.gov. Information regarding how the Fund voted
proxies relating to portfolio securities during the most recent 12-month period
ended June 30 is also available without charge upon request by calling toll-free
1-800-281-3217, or on the SEC's website at http://www.sec.gov.
The Trust files a complete listing of portfolio holdings for the Fund with the
SEC as of the first and third quarters of each fiscal year on Form N-Q. These
filings are available upon request by calling 1-800-281-3217. Furthermore, you
may obtain a copy of these filings on the SEC's website at http://www.sec.gov.
The Trust's Forms N-Q may also be reviewed and copied at the SEC's Public
Reference Room in Washington, DC, and information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330.
A complete listing of portfolio holdings for the Fund is updated daily and can
be reviewed at the Fund's website at http://www.investdavenport.com.
17
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DAVENPORT
EQUITY FUND
-----------
SEMI-ANNUAL REPORT
September 30, 2007
(Unaudited)
THE DAVENPORT EQUITY FUND
INVESTMENT ADVISER
Davenport & Company LLC
One James Center
901 East Cary Street
Richmond, Virginia 23219-4037
ADMINISTRATOR
Ultimus Fund Solutions, LLC
P.O. Box 46707
Cincinnati, Ohio 45246-0707
1-800-281-3217
CUSTODIAN
US Bank
425 Walnut Street
Cincinnati, Ohio 45202
INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
Ernst & Young LLP
1900 Scripps Center
312 Walnut Street
Cincinnati, Ohio 45202
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
BOARD OF TRUSTEES
Austin Brockenbrough III
John T. Bruce
Charles M. Caravati, Jr.
Robert S. Harris
J. Finley Lee, Jr.
Richard L. Morrill
Harris V. Morrissette
Erwin H. Will, Jr.
Samuel B. Witt III
OFFICERS
Joseph L. Antrim III, President
John P. Ackerly IV, Vice President
THE
FLIPPIN, BRUCE & PORTER
FUNDS
---------------------------------
FBP VALUE FUND
FBP BALANCED FUND
SEMI-ANNUAL REPORT
September 30, 2007
(Unaudited)
NO-LOAD FUNDS
LETTER TO SHAREHOLDERS NOVEMBER 23, 2007
================================================================================
We are pleased to report on the progress of your Fund and its investments for
the semi-annual period ended September 30, 2007. Illustrated below are the
returns over the past year and longer time periods.
% Average Annual Returns
Periods Ended September 30, 2007
----------------------------------------------
One Year Three Years Five Years Ten Years
- --------------------------------------------------------------------------------
FBP Value Fund 8.85 11.63 15.00 6.84
FBP Balanced Fund 8.03 9.17 11.83 6.68
Volatility has clearly returned to the marketplace as evidenced in price
movements of both stocks and bonds over the past number of months. Stocks
generated above average returns from mid 2002 until early this year with very
little volatility, however the environment today has clearly changed. Investors
are once again pricing assets with an added risk premium, which on a long term
basis will be positive, but short term the adjustment certainly is painful. With
the exception of U.S. Government securities, most financial assets have
performed very poorly since September 30 as fears of widening credit problems
are rippling through various sectors of the market. A slowing U.S. economy,
driven by a consumer pullback due to a weak housing market and higher energy
costs, seems to be the catalyst.
Real GDP growth for 2007 will be approximately 2%, however we expect both the
fourth quarter of this year and early next year to be even softer. Whether it
weakens enough to be classified as recessionary is yet to be seen, but the
financial markets are clearly behaving as if a recession is on the horizon.
Quality is currently in vogue, whether a high quality corporate bond, a U.S.
Treasury security, or high quality stock. Those sectors most affected by
consumer spending (i.e. retail, housing, financials, and auto) are all under
pressure. The markets additionally are being negatively affected by tax loss
selling, which normally peaks in late October to mid-November, and as a result
of analysts' revisions to earnings expectations.
The Funds' holdings in Financials, increased exposure to Consumer Discretionary
stocks and low exposure to Energy stocks have held back returns. Information
Technology and Health Care have both performed well and have been overweighted.
We see troubling signs of overvaluation in Energy. Crude oil is approaching $100
per barrel, driven largely by geopolitical concerns and a weak dollar. Most
energy companies' stock prices have risen faster this year than fundamental
revenue or earnings improvement. Conversely, we see tremendous opportunity in
both Financials and Consumer Discretionary, as recent weakness has provided
additional buying opportunities and set up the potential for substantial upside
over the next several years. During this semi-annual period, the Funds invested
in several new positions. Amgen, a global biotechnology company, is selling at
valuation levels significantly below its historical averages. We believe
investors have overreacted to the challenges facing the company's anemia
franchise. KB Home, one of America's premier homebuilders, and Masco, a leading
manufacturer of home improvement and building products, were also added.
Flextronics, a global electronics contract manufacturer, was added as we see
opportunity for it to expand market share and enhance profitability as it
completes its acquisition of Solectron. A small position in Popular, Inc. was
added to each Fund's Financials sector holdings. Eliminated from the Funds were
positions in EMC, Gannett, Tyco International and, due to their acquisitions by
private equity buyers, Sabre and Realogy.
1
As we look forward, we must always remember that markets are discounting
mechanisms. Today, the prices of many stocks, bonds and other financial
instruments reflect a very negative outlook. Valuations have become very
attractive in our opinion when looking at earnings potential, cash flows and
assets. Our economy is still growing, just at a slower rate. Growth outside the
U.S. is even stronger and will help pull us along. The Federal Reserve has
lowered interest rates and, in our opinion, will continue to do so while also
providing ample liquidity to our financial system. When it is clear that the
economy is stronger and the country is past the peak of the housing problems,
prices will go much higher.
Please visit our website at www.fbpinc.com for information on our firm,
philosophy, investment process and staff. As always, we thank you for your
continued confidence and investment in The Flippin, Bruce & Porter Funds.
/s/ John T. Bruce
John T. Bruce, CFA
President - Portfolio Manager
November 23, 2007
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE. INVESTMENT RESULTS AND
PRINCIPAL VALUE WILL FLUCTUATE SO THAT SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THEIR ORIGINAL COST. CURRENT PERFORMANCE MAY BE HIGHER OR LOWER
THAN THE PERFORMANCE DATA QUOTED. PERFORMANCE DATA CURRENT TO THE MOST RECENT
MONTH-END, ARE AVAILABLE BY CALLING 1-866-738-1127.
AN INVESTOR SHOULD CONSIDER THE INVESTMENT OBJECTIVES, RISKS, CHARGES AND
EXPENSES OF THE FUNDS CAREFULLY BEFORE INVESTING. THE FUNDS' PROSPECTUSES
CONTAIN THIS AND OTHER IMPORTANT INFORMATION. TO OBTAIN A COPY OF THE FUNDS
PROSPECTUS PLEASE CALL 1-866-738-1127 AND A COPY WILL BE SENT TO YOU FREE OF
CHARGE OR DOWNLOAD A COPY AT WWW.FBPINC.COM. PLEASE READ THE PROSPECTUS
CAREFULLY BEFORE YOU INVEST. THE FUNDS ARE DISTRIBUTED BY ULTIMUS FUND
DISTRIBUTORS, LLC.
The Letter to Shareholders seeks to describe some of the Adviser's current
opinions and views of the financial markets. Although the Adviser believes it
has a reasonable basis for any opinions or views expressed, actual results may
differ, sometimes significantly so, from those expected or expressed.
2
THE FLIPPIN, BRUCE & PORTER FUNDS
COMPARATIVE PERFORMANCE CHARTS
(UNAUDITED)
================================================================================
Performance for each Fund is compared to the most appropriate broad-based index,
the S&P 500, an unmanaged index of 500 large common stocks. Over time, this
index has the potential to outpace the FBP Balanced Fund, which normally
maintains at least 25% in bonds. Balanced funds have the growth potential to
outpace inflation, but they will typically lag a 100% stock index over the long
term because of the bond portion of their portfolios. However, the advantage of
the bond portion is that it can make the return and principal of a balanced fund
more stable than a portfolio completely invested in stocks. Results are also
compared to the Consumer Price Index, a measure of inflation.
FBP VALUE FUND
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE FBP VALUE
FUND, THE STANDARD & POOR'S 500 INDEX AND THE CONSUMER PRICE INDEX
[LINE GRAPH OMITTED]
FBP VALUE FUND STANDARD & POOR'S 500 INDEX CONSUMER PRICE INDEX
-------------- --------------------------- --------------------
DATE VALUE DATE VALUE DATE VALUE
---- ------- ---- ------- ---- -------
09/30/97 $10,000 09/30/97 $10,000 09/30/97 $10,000
12/31/97 9,927 12/31/97 10,287 12/31/97 10,062
03/31/98 11,137 03/31/98 11,722 03/31/98 10,074
06/30/98 11,098 06/30/98 12,109 06/30/98 10,131
09/30/98 9,394 09/30/98 10,905 09/30/98 10,173
12/31/98 11,705 12/31/98 13,227 12/31/98 10,216
03/31/99 11,999 03/31/99 13,886 03/31/99 10,241
06/30/99 13,615 06/30/99 14,865 06/30/99 10,334
09/30/99 11,823 09/30/99 13,937 09/30/99 10,390
12/31/99 12,142 12/31/99 16,010 12/31/99 10,471
03/31/00 11,351 03/31/00 16,378 03/31/00 10,571
06/30/00 10,943 06/30/00 15,942 06/30/00 10,676
09/30/00 11,381 09/30/00 15,788 09/30/00 10,757
12/31/00 11,909 12/31/00 14,553 12/31/00 10,838
03/31/01 12,165 03/31/01 12,827 03/31/01 10,944
06/30/01 13,067 06/30/01 13,578 06/30/01 11,062
09/30/01 11,484 09/30/01 11,585 09/30/01 11,050
12/31/01 13,264 12/31/01 12,823 12/31/01 11,044
03/31/02 13,283 03/31/02 12,858 03/31/02 11,069
06/30/02 11,591 06/30/02 11,136 06/30/02 11,193
09/30/02 9,638 09/30/02 9,212 09/30/02 11,249
12/31/02 10,385 12/31/02 9,989 12/31/02 11,286
03/31/03 9,748 03/31/03 9,674 03/31/03 11,398
06/30/03 11,677 06/30/03 11,164 06/30/03 11,423
09/30/03 12,210 09/30/03 11,459 09/30/03 11,491
12/31/03 13,700 12/31/03 12,854 12/31/03 11,486
03/31/04 14,291 03/31/04 13,072 03/31/04 11,591
06/30/04 14,459 06/30/04 13,297 06/30/04 11,772
09/30/04 13,935 09/30/04 13,049 09/30/04 11,797
12/31/04 15,181 12/31/04 14,253 12/31/04 11,890
03/31/05 14,955 03/31/05 13,947 03/31/05 12,034
06/30/05 15,303 06/30/05 14,138 06/30/05 12,198
09/30/05 15,559 09/30/05 14,647 09/30/05 12,323
12/31/05 16,070 12/31/05 14,953 12/31/05 12,398
03/31/06 16,754 03/31/06 15,582 03/31/06 12,468
06/30/06 16,553 06/30/06 15,358 06/30/06 12,706
09/30/06 17,807 09/30/06 16,228 09/30/06 12,794
12/31/06 18,909 12/31/06 17,315 12/31/06 12,643
03/31/07 18,692 03/31/07 17,426 03/31/07 12,768
06/30/07 19,808 06/30/07 18,520 06/30/07 13,048
09/30/07 19,383 09/30/07 18,896 09/30/07 13,045
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
3
THE FLIPPIN, BRUCE & PORTER FUNDS
COMPARATIVE PERFORMANCE CHARTS
(CONTINUED) (UNAUDITED)
================================================================================
FBP BALANCED FUND
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE FBP BALANCED
FUND, THE STANDARD & POOR'S 500 INDEX AND THE CONSUMER PRICE INDEX
[LINE GRAPH OMITTED]
FBP BALANCED FUND STANDARD & POOR'S 500 INDEX CONSUMER PRICE INDEX
----------------- --------------------------- --------------------
DATE VALUE DATE VALUE DATE VALUE
---- ------- ---- ------- ---- -------
09/30/97 $10,000 09/30/97 $10,000 09/30/97 $10,000
12/31/97 9,970 12/31/97 10,287 12/31/97 10,062
03/31/98 10,861 03/31/98 11,722 03/31/98 10,074
06/30/98 10,959 06/30/98 12,109 06/30/98 10,131
09/30/98 9,859 09/30/98 10,905 09/30/98 10,173
12/31/98 11,479 12/31/98 13,227 12/31/98 10,216
03/31/99 11,810 03/31/99 13,886 03/31/99 10,241
06/30/99 12,847 06/30/99 14,865 06/30/99 10,334
09/30/99 11,673 09/30/99 13,937 09/30/99 10,390
12/31/99 12,089 12/31/99 16,010 12/31/99 10,471
03/31/00 11,588 03/31/00 16,378 03/31/00 10,571
06/30/00 11,233 06/30/00 15,942 06/30/00 10,676
09/30/00 11,686 09/30/00 15,788 09/30/00 10,757
12/31/00 12,216 12/31/00 14,553 12/31/00 10,838
03/31/01 12,439 03/31/01 12,827 03/31/01 10,944
06/30/01 13,066 06/30/01 13,578 06/30/01 11,062
09/30/01 12,163 09/30/01 11,585 09/30/01 11,050
12/31/01 13,428 12/31/01 12,823 12/31/01 11,044
03/31/02 13,400 03/31/02 12,858 03/31/02 11,069
06/30/02 12,233 06/30/02 11,136 06/30/02 11,193
09/30/02 10,914 09/30/02 9,212 09/30/02 11,249
12/31/02 11,586 12/31/02 9,989 12/31/02 11,286
03/31/03 11,234 03/31/03 9,674 03/31/03 11,398
06/30/03 12,850 06/30/03 11,164 06/30/03 11,423
09/30/03 13,280 09/30/03 11,459 09/30/03 11,491
12/31/03 14,472 12/31/03 12,854 12/31/03 11,486
03/31/04 14,963 03/31/04 13,072 03/31/04 11,591
06/30/04 15,054 06/30/04 13,297 06/30/04 11,772
09/30/04 14,675 09/30/04 13,049 09/30/04 11,797
12/31/04 15,636 12/31/04 14,253 12/31/04 11,890
03/31/05 15,442 03/31/05 13,947 03/31/05 12,034
06/30/05 15,704 06/30/05 14,138 06/30/05 12,198
09/30/05 15,889 09/30/05 14,647 09/30/05 12,323
12/31/05 16,286 12/31/05 14,953 12/31/05 12,398
03/31/06 16,802 03/31/06 15,582 03/31/06 12,468
06/30/06 16,711 06/30/06 15,358 06/30/06 12,706
09/30/06 17,672 09/30/06 16,228 09/30/06 12,794
12/31/06 18,511 12/31/06 17,315 12/31/06 12,643
03/31/07 18,431 03/31/07 17,426 03/31/07 12,768
06/30/07 19,278 06/30/07 18,520 06/30/07 13,048
09/30/07 19,093 09/30/07 18,896 09/30/07 13,045
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS (a)
(FOR PERIODS ENDED SEPTEMBER 30, 2007)
1 YEAR 5 YEARS 10 YEARS
------ ------- --------
FBP Value Fund 8.85% 15.00% 6.84%
FBP Balanced Fund 8.03% 11.83% 6.68%
Standard & Poor's 500 Index 16.44% 15.45% 6.57%
Consumer Price Index 1.96% 3.01% 2.69%
- --------------------------------------------------------------------------------
(a) Total returns are a measure of the change in value of an investment
in the Funds over the periods covered, which assumes any dividends
or capital gains distributions are reinvested in shares of the
Funds. Returns do not reflect the deduction of taxes a shareholder
would pay on Fund distributions or the redemption of Fund shares.
4
FBP VALUE FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
GENERAL INFORMATION
- -----------------------------------------
Net Asset Value Per Share $28.14
Total Net Assets (Millions) $ 59.0
Current Expense Ratio 0.99%
Portfolio Turnover 13%
Fund Inception Date 7/30/93
FBP VALUE S&P 500
STOCK CHARACTERISTICS FUND INDEX
- --------------------------------------------------
Number of Stocks 46 500
Weighted Avg Market
Capitalization (Billions) 109.9 121.1
Price-to-Earnings Ratio
(IBES 1 Yr. Forecast EPS) 12.9 14.8
Price-to-Book Value 2.2 2.9
ASSET ALLOCATION
- ----------------------------------------
[PIE CHART OMITTED]
Cash Equivalents 0.6%
Stocks 99.4%
INDUSTRY CONCENTRATION VS. THE S&P 500 INDEX
- --------------------------------------------------------------------------------
[BAR CHAR OMITTED]
(% of Net Assets)
FBP Value Fund S&P 500 Index
-------------- -------------
Consumer Discretionary 14.6% 9.2%
Consumer Staples 8.4% 9.5%
Energy 2.6% 11.7%
Financials 30.4% 19.8%
Health Care 15.1% 11.7%
Industrials 7.5% 11.5%
Information Technology 17.0% 16.2%
Materials 0.0% 3.2%
Telecommunication Services 3.8% 3.8%
Utilities 0.0% 3.4%
TEN LARGEST HOLDINGS % OF NET ASSETS
-------------------- ---------------
International Business Machines Corporation 4.4%
Bank of America Corporation 4.3%
American International Group, Inc. 4.1%
Citigroup, Inc. 3.7%
Wachovia Corporation 3.7%
General Electric Company 3.6%
JPMorgan Chase & Company 3.5%
Travelers Companies, Inc. (The) 3.4%
Wal-Mart Stores, Inc. 3.3%
Johnson & Johnson 3.2%
5
FBP BALANCED FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
GENERAL INFORMATION
- ------------------------------------------
Net Asset Value Per Share $19.44
Total Net Assets (Millions) $ 67.2
Current Expense Ratio 0.96%
Portfolio Turnover 14%
Fund Inception Date 7/3/89
ASSET ALLOCATION
- ------------------------------------------
[PIE CHART OMITTED]
Cash Equivalents 3.5%
Fixed Income 25.7%
Stocks 70.8%
STOCK PORTFOLIO (70.8% OF FUND)
- --------------------------------------------------------------------------------
Number of Stocks 46
Weighted Avg Market
Capitalization (Billions) 110.7
Price-to-Earnings Ratio
(IBES 1 Yr. Forecast EPS) 13.1
Price-to-Book Value 2.2
FIVE LARGEST SECTORS % OF NET ASSETS
- -------------------- ---------------
Financials 21.0%
Information Technology 12.9%
Health Care 11.2%
Consumer Discretionary 9.8%
Consumer Staples 6.3%
TEN LARGEST HOLDINGS % OF NET ASSETS
- -------------------- ---------------
International Business Machines
Corporation 3.5%
Bank of America Corporation 3.0%
American International Group, Inc. 2.8%
Johnson & Johnson 2.5%
Citigroup, Inc. 2.5%
General Electric Company 2.5%
Wachovia Corporation 2.4%
JPMorgan Chase & Company 2.4%
Wal-Mart Stores, Inc. 2.3%
Travelers Companies, Inc. (The) 2.2%
FIXED-INCOME PORTFOLIO (25.7% OF FUND)
- --------------------------------------------------------------------------------
Number of Fixed-Income Securities 24 SECTOR BREAKDOWN % OF NET ASSETS
Average Quality AA ----------------- ---------------
Average Stated Maturity 2.0 U.S. Treasury 2.6%
Average Effective Duration 1.6 Government Agency 7.1%
Corporate 16.0%
6
FBP VALUE FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 99.4% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 14.6%
28,000 Best Buy Company, Inc. ................................. $ 1,288,560
20,000 Family Dollar Stores, Inc. (b).......................... 531,200
35,000 General Motors Corporation (b).......................... 1,284,500
24,000 Home Depot, Inc. (The).................................. 778,560
33,000 KB HOME................................................. 826,980
20,000 Kohl's Corporation (a) ................................. 1,146,600
39,000 Leggett & Platt, Inc. .................................. 747,240
27,000 Macy's, Inc. ........................................... 872,640
35,000 Wyndham Worldwide Corporation........................... 1,146,600
-----------
8,622,880
-----------
CONSUMER STAPLES -- 8.4%
12,000 Altria Group, Inc. ..................................... 834,360
37,000 CVS Caremark Corporation................................ 1,466,310
10,000 Kimberly-Clark Corporation.............................. 702,600
45,200 Wal-Mart Stores, Inc. .................................. 1,972,980
-----------
4,976,250
-----------
ENERGY -- 2.6%
21,000 Pioneer Natural Resources Company (b)................... 944,580
7,500 Royal Dutch Shell PLC - Class A - ADR................... 616,350
-----------
1,560,930
-----------
FINANCIALS -- 30.4%
17,000 American Express Company................................ 1,009,290
35,400 American International Group, Inc. ..................... 2,394,810
50,000 Bank of America Corporation............................. 2,513,500
47,000 Citigroup, Inc. ........................................ 2,193,490
16,000 Fannie Mae (b).......................................... 972,960
17,700 Freddie Mac............................................. 1,044,477
45,000 JPMorgan Chase & Company................................ 2,061,900
17,065 Lincoln National Corporation............................ 1,125,778
38,000 Popular, Inc............................................ 466,640
40,000 Travelers Companies, Inc. (The)......................... 2,013,600
43,000 Wachovia Corporation.................................... 2,156,450
-----------
17,952,895
-----------
HEALTH CARE -- 15.1%
20,000 Amgen, Inc. (a)......................................... 1,131,400
29,000 Johnson & Johnson....................................... 1,905,300
25,000 Merck & Company, Inc. ................................. 1,292,250
67,000 Pfizer, Inc. ........................................... 1,636,810
40,000 Watson Pharmaceuticals, Inc. (a)........................ 1,296,000
21,000 WellPoint, Inc. (a)..................................... 1,657,320
-----------
8,919,080
-----------
7
FBP VALUE FUND
SCHEDULE OF INVESTMENTS
===============================================================================
SHARES COMMON STOCKS -- 99.4%(CONTINUED) VALUE
- -------------------------------------------------------------------------------
INDUSTRIALS -- 7.5%
12,000 Avery Dennison Corporation.............................. $ 684,240
10,300 FedEx Corporation ...................................... 1,078,925
51,000 General Electric Company................................ 2,111,400
23,000 Masco Corporation....................................... 532,910
-----------
4,407,475
-----------
INFORMATION TECHNOLOGY -- 17.0%
20,000 Agilent Technologies, Inc. (a) (b) ..................... 737,600
49,000 Cisco Systems, Inc. (a) ................................ 1,622,390
20,400 Computer Sciences Corporation (a) ...................... 1,140,360
50,000 Flextronics International, Ltd. (a) .................... 559,000
32,000 Hewlett-Packard Company (b)............................. 1,593,280
22,000 International Business Machines Corporation............. 2,591,600
40,000 Microsoft Corporation................................... 1,178,400
156,000 Solectron Corporation (a) .............................. 608,400
-----------
10,031,030
-----------
TELECOMMUNICATIONS SERVICES -- 3.8%
70,000 Sprint Nextel Corporation (b)........................... 1,330,000
20,000 Verizon Communications, Inc. .......................... 885,600
-----------
2,215,600
-----------
TOTAL COMMON STOCKS (Cost $40,826,711).................. $58,686,140
-----------
===============================================================================
SHARES MONEY MARKET FUNDS -- 0.7% VALUE
- -------------------------------------------------------------------------------
386,373 Fidelity Institutional Government Portfolio -
Class I (Cost $386,373) .............................. $ 386,373
-----------
TOTAL INVESTMENTS AT VALUE -- 100.1% (Cost $41,213,084). $59,072,513
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.1%)......... (40,362)
-----------
NET ASSETS -- 100.0%.................................... $59,032,151
===========
(a) Non-income producing security.
(b) Security covers a written call option.
ADR - American Depositary Receipt
See accompanying notes to financial statements.
8
FBP VALUE FUND
SCHEDULE OF OPEN OPTION CONTRACTS
SEPTEMBER 30, 2007 (UNAUDITED)
============================================================================
OPTION VALUE OF PREMIUMS
CONTRACTS COVERED CALL OPTIONS OPTIONS RECEIVED
- ----------------------------------------------------------------------------
Agilent Technologies, Inc.,
50 11/17/2007 at $40................... $ 2,500 $ 10,874
Family Dollar Stores, Inc.,
40 10/20/2007 at $35................... 200 9,323
Fannie Mae,
40 01/19/2008 at $70................... 3,720 15,616
General Motors Corporation,
85 01/19/2008 at $40................... 20,400 17,603
Hewlett-Packard Company,
80 01/19/2008 at $50................... 24,800 17,781
Pioneer Natural Resources Company,
35 12/22/2007 at $55................... 875 12,669
Sprint Nextel Corporation,
140 11/17/2007 at $22.50................ 2,100 23,800
--------- ----------
$ 54,595 $ 107,666
========= ==========
See accompanying notes to financial statements.
9
FBP BALANCED FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
===============================================================================
SHARES COMMON STOCKS -- 70.8% VALUE
- -------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 9.8%
21,600 Best Buy Company, Inc. ................................. $ 994,032
16,000 Family Dollar Stores, Inc. (b).......................... 424,960
26,000 General Motors Corporation (b).......................... 954,200
18,000 Home Depot, Inc. (The).................................. 583,920
26,000 KB HOME................................................. 651,560
16,000 Kohl's Corporation (a) ................................. 917,280
25,000 Leggett & Platt, Inc. .................................. 479,000
20,000 Macy's, Inc. ........................................... 646,400
28,000 Wyndham Worldwide Corporation........................... 917,280
-----------
6,568,632
-----------
CONSUMER STAPLES -- 6.3%
14,000 Altria Group, Inc. ..................................... 973,420
29,500 CVS Caremark Corporation................................ 1,169,085
7,700 Kimberly-Clark Corporation.............................. 541,002
35,000 Wal-Mart Stores, Inc. .................................. 1,527,750
-----------
4,211,257
-----------
ENERGY -- 1.8%
17,000 Pioneer Natural Resources Company (b)................... 764,660
5,300 Royal Dutch Shell PLC - ADR............................. 435,554
-----------
1,200,214
-----------
FINANCIALS -- 21.0%
18,000 American Express Company................................ 1,068,660
27,500 American International Group, Inc....................... 1,860,375
40,000 Bank of America Corporation............................. 2,010,800
36,000 Citigroup, Inc. ........................................ 1,680,120
13,000 Fannie Mae (b).......................................... 790,530
13,400 Freddie Mac............................................. 790,734
35,000 JPMorgan Chase & Company................................ 1,603,700
11,676 Lincoln National Corporation............................ 770,266
30,000 Popular, Inc............................................ 368,400
30,000 Travelers Companies, Inc. (The)......................... 1,510,200
32,800 Wachovia Corporation.................................... 1,644,920
-----------
14,098,705
-----------
HEALTH CARE -- 11.2%
14,000 Amgen, Inc. (a)......................................... 791,980
26,000 Johnson & Johnson....................................... 1,708,200
25,400 Merck & Company, Inc. ................................. 1,312,926
51,300 Pfizer, Inc. ........................................... 1,253,259
36,000 Watson Pharmaceuticals, Inc. (a)........................ 1,166,400
16,400 WellPoint, Inc. (a)..................................... 1,294,288
-----------
7,527,053
-----------
INDUSTRIALS -- 5.0%
9,300 Avery Dennison Corporation.............................. 530,286
7,400 FedEx Corporation ..................................... 775,150
40,000 General Electric Company................................ 1,656,000
18,000 Masco Corporation....................................... 417,060
-----------
3,378,496
-----------
10
FBP BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
===============================================================================
SHARES COMMON STOCKS -- 70.8% (CONTINUED) VALUE
- -------------------------------------------------------------------------------
INFORMATION TECHNOLOGY -- 12.9%
21,000 Agilent Technologies, Inc. (a) (b) ..................... $ 774,480
38,000 Cisco Systems, Inc. (a) ................................ 1,258,180
20,000 Computer Sciences Corporation (a) ...................... 1,118,000
40,000 Flextronics International, Ltd. (a) .................... 447,200
25,000 Hewlett-Packard Company (b)............................. 1,244,750
20,000 International Business Machines Corporation............. 2,356,000
35,000 Microsoft Corporation .................................. 1,031,100
115,000 Solectron Corporation (a)............................... 448,500
-----------
8,678,210
-----------
TELECOMMUNICATIONS SERVICES -- 2.8%
53,000 Sprint Nextel Corporation (b)........................... 1,007,000
20,000 Verizon Communications, Inc. .......................... 885,600
-----------
1,892,600
-----------
TOTAL COMMON STOCKS (Cost $30,231,233).................. $47,555,167
-----------
===============================================================================
PAR VALUE U.S. GOVERNMENT AND AGENCY OBLIGATIONS -- 9.7% VALUE
- -------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 2.6%
$1,000,000 5.00%, due 07/31/2008................................ $ 1,006,953
750,000 4.50%, due 11/15/2010................................ 760,254
-----------
1,767,207
-----------
FEDERAL HOME LOAN BANK -- 4.9%
500,000 4.28%, due 07/14/2008................................ 498,315
500,000 4.035%, due 03/09/2009............................... 497,029
750,000 5.25%, due 03/17/2010................................ 752,219
750,000 5.125%, due 05/28/2010............................... 752,375
750,000 5.05%, due 08/24/2011................................ 756,340
-----------
3,256,278
-----------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 1.1%
750,000 5.25%, due 10/06/2011................................ 755,166
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -- 1.1%
750,000 5.375%, due 10/11/2011............................... 750,201
-----------
TOTAL U.S. GOVERNMENT AND AGENCY OBLIGATIONS
(Cost $6,500,782).................................. $ 6,528,852
-----------
11
FBP BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
===============================================================================
PAR VALUE CORPORATE BONDS -- 16.0% VALUE
- -------------------------------------------------------------------------------
FINANCIALS -- 7.9%
Bankers Trust New York Corporation,
$ 750,000 7.375%, due 05/01/2008............................... $ 757,594
Credit Suisse First Boston USA, Inc.,
750,000 4.70%, due 06/01/2009................................ 748,087
International Lease Finance Corporation,
750,000 5.40%, due 02/15/2012................................ 743,606
John Deere Capital Corporation,
500,000 3.375%, due 10/01/2007............................... 500,000
Northern Trust Company,
1,000,000 7.10%, due 08/01/2009.............................. 1,037,677
Prudential Financial, Inc.,
750,000 5.80%, due 06/15/2012................................ 766,832
Student Loan Marketing Corporation,
750,000 3.625%, due 03/17/2008............................... 741,707
-----------
5,295,503
-----------
HEALTH CARE -- 0.7%
UnitedHealth Group, Inc.,
500,000 3.30%, due 01/30/2008................................ 497,191
-----------
INDUSTRIALS -- 4.1%
Donnelley (R.R.) & Sons Company,
750,000 3.75%, due 04/01/2009................................ 733,192
Kraft Foods, Inc.,
750,000 5.625%, due 11/01/2011............................... 754,704
Ryder System, Inc.,
750,000 5.00%, due 04/01/2011................................ 739,796
Stanley Works (The),
500,000 3.50%, due 11/01/2007................................ 499,231
-----------
2,726,923
-----------
UTILITIES -- 3.3%
Dominion Resources, Inc.,
750,000 4.125%, due 02/15/2008............................... 745,916
Ohio Power Company,
750,000 5.30%, due 11/01/2010................................ 751,272
Public Service Electric & Gas Company,
750,000 4.00%, due 11/01/2008................................ 741,352
-----------
2,238,540
-----------
TOTAL CORPORATE BONDS (Cost $10,702,280)................ $10,758,157
-----------
12
FBP BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
===============================================================================
SHARES MONEY MARKET FUNDS -- 3.3% VALUE
- -------------------------------------------------------------------------------
2,230,356 Fidelity Institutional Government Portfolio -
Class I (Cost $2,230,356) ............................ $ 2,230,356
-----------
TOTAL INVESTMENTS AT VALUE -- 99.8% (Cost $49,664,651).. $67,072,532
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.2% .......... 155,429
-----------
NET ASSETS -- 100.0%.................................... $67,227,961
===========
(a) Non-income producing security.
(b) Security covers a written call option.
ADR - American Depositary Receipt
See accompanying notes to financial statements.
FBP BALANCED FUND
SCHEDULE OF OPEN OPTION CONTRACTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
OPTION VALUE OF PREMIUMS
CONTRACTS COVERED CALL OPTIONS OPTIONS RECEIVED
- --------------------------------------------------------------------------------
Agilent Technologies, Inc.,
50 11/17/2007 at $40....................... $ 2,500 $ 10,873
Family Dollar Stores, Inc.,
30 10/20/2007 at $35....................... 150 7,050
Fannie Mae,
40 01/19/2008 at $70....................... 3,720 15,616
General Motors Corporation,
66 01/19/2008 at $40....................... 15,840 13,668
Hewlett-Packard Company,
100 01/19/2008 at $50....................... 31,000 22,227
Pioneer Natural Resources Company,
30 12/22/2007 at $55....................... 750 10,859
Sprint Nextel Corporation,
100 11/17/2007 at $22.50.................... 1,500 17,000
---------- ---------
$ 55,460 $ 97,293
========== =========
See accompanying notes to financial statements.
13
THE FLIPPIN, BRUCE & PORTER FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2007 (UNAUDITED)
====================================================================================
FBP FBP
VALUE BALANCED
FUND FUND
- ------------------------------------------------------------------------------------
ASSETS
Investments in securities:
At acquisition cost............................ $ 41,213,084 $ 49,664,651
============= =============
At value (Note 1).............................. $ 59,072,513 $ 67,072,532
Dividends and interest receivable................ 66,039 322,908
Receivable for capital shares sold............... 1,925 26,240
Other assets..................................... 9,245 6,313
------------- -------------
TOTAL ASSETS................................... 59,149,722 67,427,993
------------- -------------
LIABILITIES
Distributions payable............................ 4,806 31,550
Payable for capital shares redeemed.............. 1,003 49,294
Accrued investment advisory fees (Note 3)........ 33,789 38,352
Payable to Administrator (Note 3)................ 7,200 7,850
Other accrued expenses and liabilities........... 16,178 17,526
Covered call options, at value (Notes 1 and 4)
(premiums received $107,666 and
$97,293, respectively)......................... 54,595 55,460
------------- -------------
TOTAL LIABILITIES.............................. 117,571 200,032
------------- -------------
NET ASSETS ......................................... $ 59,032,151 $ 67,227,961
============= =============
Net assets consist of:
Paid-in capital.................................. $ 37,777,607 $ 46,867,378
Accumulated undistributed net investment income.. 4,832 100,253
Accumulated net realized gains from
security transactions.......................... 3,337,212 2,810,616
Net unrealized appreciation on investments....... 17,912,500 17,449,714
------------- -------------
Net assets.......................................... $ 59,032,151 $ 67,227,961
============= =============
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value).................................. 2,098,084 3,457,718
============= =============
Net asset value, offering price and redemption
price per share (Note 1)......................... $ 28.14 $ 19.44
============= =============
See accompanying notes to financial statements.
14
THE FLIPPIN, BRUCE & PORTER FUNDS
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2007 (UNAUDITED)
====================================================================================
FBP FBP
VALUE BALANCED
FUND FUND
- ------------------------------------------------------------------------------------
INVESTMENT INCOME
Interest......................................... $ -- $ 440,401
Dividends........................................ 660,025 562,726
------------- -------------
TOTAL INVESTMENT INCOME........................ 660,025 1,003,127
------------- -------------
EXPENSES
Investment advisory fees (Note 3)................ 214,692 238,380
Administration fees (Note 3)..................... 40,102 43,442
Professional fees................................ 8,139 8,818
Postage and supplies............................. 7,264 5,574
Trustees' fees and expenses...................... 6,287 6,287
Custodian fees................................... 5,929 5,561
Compliance service fees (Note 3)................. 4,910 5,011
Registration fees................................ 5,834 3,628
Printing of shareholder reports.................. 3,546 2,270
Insurance expense................................ 2,055 2,211
Pricing costs.................................... 659 2,260
Other expenses................................... 4,986 4,321
------------- -------------
TOTAL EXPENSES................................. 304,403 327,763
------------- -------------
NET INVESTMENT INCOME .............................. 355,622 675,364
------------- -------------
REALIZED AND UNREALIZED GAINS (LOSSES)
ON INVESTMENTS
Net realized gains on security transactions...... 3,325,464 2,795,075
Net realized gains on option contracts written... 11,599 15,312
Net change in unrealized appreciation/
depreciation on investments.................... (1,436,189) (1,064,486)
------------- -------------
NET REALIZED AND UNREALIZED GAINS
ON INVESTMENTS .................................. 1,900,874 1,745,901
------------- -------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS ................................. $ 2,256,496 $ 2,421,265
============= =============
See accompanying notes to financial statements.
15
THE FLIPPIN, BRUCE & PORTER FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=====================================================================================================
FBP FBP
VALUE FUND BALANCED FUND
--------------------------- ---------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
SEPT. 30, ENDED SEPT. 30, ENDED
2007 MARCH 31, 2007 MARCH 31,
(UNAUDITED) 2007 (UNAUDITED) 2007
- -----------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ................ $ 355,622 $ 703,122 $ 675,364 $ 1,263,651
Net realized gains on:
Security transactions .............. 3,325,464 3,893,568 2,795,075 2,661,939
Option contracts written ........... 11,599 269,755 15,312 180,970
Net change in unrealized appreciation/
depreciation on investments ........ (1,436,189) 1,578,555 (1,064,486) 1,880,976
------------ ------------ ------------ ------------
Net increase in net assets
from operations ...................... 2,256,496 6,445,000 2,421,265 5,987,536
------------ ------------ ------------ ------------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment income ........... (359,089) (703,259) (656,617) (1,261,402)
From realized capital gains on
security transactions .............. -- (4,163,508) -- (2,826,469)
------------ ------------ ------------ ------------
Net decrease in net assets from
distributions to shareholders ........ (359,089) (4,866,767) (656,617) (4,087,871)
------------ ------------ ------------ ------------
FROM CAPITAL
SHARE TRANSACTIONS
Proceeds from shares sold ............ 1,590,994 7,533,124 2,311,031 2,955,850
Net asset value of shares issued in
reinvestment of distributions
to shareholders .................... 349,374 4,724,181 581,992 3,694,969
Payments for shares redeemed ......... (5,038,534) (13,213,446) (3,787,299) (4,973,441)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
from capital share transactions ...... (3,098,166) (956,141) (894,276) 1,677,378
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS ........................ (1,200,759) 622,092 870,372 3,577,043
NET ASSETS
Beginning of period .................. 60,232,910 59,610,818 66,357,589 62,780,546
------------ ------------ ------------ ------------
End of period ........................ $ 59,032,151 $ 60,232,910 $ 67,227,961 $ 66,357,589
============ ============ ============ ============
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME ................ $ 4,832 $ 8,299 $ 100,253 $ 81,506
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ................................. 55,565 276,657 120,514 155,242
Reinvested ........................... 12,270 171,718 29,716 194,182
Redeemed ............................. (176,191) (483,330) (194,058) (260,834)
------------ ------------ ------------ ------------
Net increase (decrease) in
shares outstanding ................. (108,356) (34,955) (43,828) 88,590
Shares outstanding at
beginning of period ................ 2,206,440 2,241,395 3,501,546 3,412,956
------------ ------------ ------------ ------------
Shares outstanding at end of period .. 2,098,084 2,206,440 3,457,718 3,501,546
============ ============ ============ ============
See accompanying notes to financial statements.
16
FBP VALUE FUND
FINANCIAL HIGHLIGHTS
===========================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
===========================================================================================================================
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 ------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
- ---------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 27.30 $ 26.60 $ 25.73 $ 24.86 $ 17.12 $ 23.59
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.17 0.33 0.32 0.29 0.22 0.20
Net realized and unrealized gains
(losses) on investments .............. 0.84 2.71 2.70 0.86 7.74 (6.47)
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ 1.01 3.04 3.02 1.15 7.96 (6.27)
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.17) (0.33) (0.32) (0.28) (0.22) (0.20)
Distributions from net realized gains . -- (2.01) (1.83) -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.17) (2.34) (2.15) (0.28) (0.22) (0.20)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 28.14 $ 27.30 $ 26.60 $ 25.73 $ 24.86 $ 17.12
========== ========== ========== ========== ========== ==========
Total return (a) ........................ 3.69%(b) 11.57% 12.03% 4.65% 46.60% (26.61%)
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 59,032 $ 60,233 $ 59,611 $ 61,212 $ 50,400 $ 48,552
========== ========== ========== ========== ========== ==========
Ratio of expenses to average net assets . 0.99%(c) 1.01% 1.01% 1.00% 1.02% 1.00%
Ratio of net investment income to
average net assets .................... 1.16%(c) 1.19% 1.17% 1.17% 0.94% 1.06%
Portfolio turnover rate ................. 13%(b) 16% 15% 15% 19% 12%
(a) Total return is a measure of the change in value of an investment in the
Fund over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Fund. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(b) Not annualized.
(c) Annualized.
See accompanying notes to financial statements.
17
FBP BALANCED FUND
FINANCIAL HIGHLIGHTS
==================================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
==================================================================================================================================
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 ----------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 18.95 $ 18.39 $ 18.06 $ 18.40 $ 14.46 $ 17.68
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.20 0.37 0.33 0.29 0.29 0.36
Net realized and unrealized gains
(losses) on investments .............. 0.48 1.39 1.22 0.28 4.49 (3.21)
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ 0.68 1.76 1.55 0.57 4.78 (2.85)
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.19) (0.37) (0.32) (0.30) (0.31) (0.37)
Distributions from net realized gains . -- (0.83) (0.90) (0.61) (0.53) --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.19) (1.20) (1.22) (0.91) (0.84) (0.37)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 19.44 $ 18.95 $ 18.39 $ 18.06 $ 18.40 $ 14.46
========== ========== ========== ========== ========== ==========
Total return (a) ........................ 3.58%(b) 9.70% 8.81% 3.20% 33.19% (16.16%)
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 67,228 $ 66,358 $ 62,781 $ 61,466 $ 58,290 $ 44,333
========== ========== ========== ========== ========== ==========
Ratio of expenses to average net assets . 0.96%(c) 0.97% 0.99% 0.96% 0.98% 1.00%
Ratio of net investment income to
average net assets .................... 1.99%(c) 1.95% 1.75% 1.62% 1.68% 2.31%
Portfolio turnover rate ................. 14%(b) 17% 24% 17% 21% 21%
(a) Total return is a measure of the change in value of an investment in the
Fund over the periods covered, which assumes any dividends or capital
gains distributions are reinvested in shares of the Fund. Returns do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(b) Not annualized.
(c) Annualized.
See accompanying notes to financial statements.
18
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The FBP Value Fund and the FBP Balanced Fund (the Funds) are no-load,
diversified series of the Williamsburg Investment Trust (the Trust), an open-end
management investment company registered under the Investment Company Act of
1940. The Trust was organized as a Massachusetts business trust on July 18,
1988.
The FBP Value Fund seeks long term growth of capital through investment in a
diversified portfolio comprised primarily of equity securities, with current
income as a secondary objective.
The FBP Balanced Fund seeks long term capital appreciation and current income
through investment in a balanced portfolio of equity and fixed income securities
assuming a moderate level of investment risk.
The following is a summary of the Funds' significant accounting policies:
Securities valuation -- The Funds' portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern time). Securities traded on a national stock
exchange are valued based upon the closing price on the principal exchange where
the security is traded. Securities which are quoted by NASDAQ are valued at the
NASDAQ Official Closing Price. Securities which are traded over-the-counter are
valued at the last sales price, if available, otherwise, at the last quoted bid
price. It is expected that fixed income securities will ordinarily be traded in
the over-the-counter market, and common stocks will ordinarily be traded on a
national securities exchange, but may also be traded in the over-the-counter
market. When market quotations are not readily available, securities may be
valued on the basis of prices provided by an independent pricing service. Call
options written by the Funds are valued at the then current market quotation,
using the ask price as of the close of each day on the principal exchanges on
which they are traded. Short-term instruments (those with remaining maturities
of 60 days or less) are valued at amortized cost, which approximates market
value. Securities and other assets for which no quotations are readily available
or are considered to be unreliable due to significant market or other events
will be valued in good faith at fair value using methods determined by the Board
of Trustees. Such methods of fair valuation may include, but are not limited to:
multiple of earnings, multiple of book value, discount from market of a similar
freely traded security, purchase price of security, subsequent private
transactions in the security or related securities, or a combination of these
and other factors.
Share valuation -- The net asset value per share of each Fund is calculated
daily by dividing the total value of each Fund's assets, less liabilities, by
the number of shares outstanding. The offering price and redemption price per
share of each Fund is equal to the net asset value per share.
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed income
securities purchased are amortized using the interest method.
Repurchase agreements -- The Funds may enter into joint repurchase agreements
with other funds within the Trust. The joint repurchase agreement, which is
collateralized by U.S. Government obligations, is valued at cost which, together
with accrued interest, approximates market value. At the time the Funds enter
into the joint repurchase agreement, the Funds take possession of the underlying
securities and the seller agrees that the value of the underlying securities,
including accrued interest, will at all times be equal to or exceed the face
amount of the repurchase agreement. In addition, each Fund actively monitors and
seeks additional collateral, as needed.
Distributions to shareholders -- Dividends arising from net investment income
are declared and paid quarterly to shareholders of each Fund. Net realized
short-term capital gains, if any, may be distributed throughout the year and net
realized long-term capital gains, if any, are distributed at least once each
year. The amount of distributions from net investment income and net realized
gains are determined in accordance with federal income tax regulations which may
differ from accounting principles generally accepted in the United States. These
"book/tax" differences are either temporary or permanent in nature.
19
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The tax character of distributions paid during the periods ended September 30,
2007 and March 31, 2007 are as follows:
- --------------------------------------------------------------------------------------
Period Ordinary Long-Term Total
Ended Income Capital Gains Distributions
- --------------------------------------------------------------------------------------
FBP Value Fund ................... 09/30/07 $ 359,089 $ -- $ 359,089
03/31/07 $ 952,036 $3,914,731 $4,866,767
- --------------------------------------------------------------------------------------
FBP Balanced Fund ................ 09/30/07 $ 656,617 $ -- $ 656,617
03/31/07 $1,457,134 $2,630,737 $4,087,871
- --------------------------------------------------------------------------------------
Security transactions -- Security transactions are accounted for on trade date.
Gains and losses on securities sold are determined on a specific identification
basis.
Common expenses -- Common expenses of the Trust are allocated among the funds of
the Trust which may be based on relative net assets of each fund or the nature
of the services performed and the relative applicability to each fund.
Options transactions -- The Funds may write covered call options for which
premiums are received and are recorded as liabilities, and are subsequently
valued daily at the closing prices on their primary exchanges. Premiums received
from writing options which expire are treated as realized gains. Premiums
received from writing options which are exercised increase the proceeds used to
calculate the realized gain or loss on the sale of the security. If a closing
purchase transaction is used to terminate the Funds' obligation on a call, a
gain or loss will be realized, depending upon whether the price of the closing
purchase transaction is more or less than the premium previously received on the
call written.
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates.
Federal income tax -- It is each Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which a Fund so
qualifies and distributes at least 90% of its taxable net income, the Fund (but
not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is computed on a tax basis for each item as of
September 30, 2007:
- ---------------------------------------------------------------------------------
FBP FBP
VALUE FUND BALANCED FUND
- ---------------------------------------------------------------------------------
Cost of portfolio investments and written options . $ 41,105,418 $ 49,497,832
============ ============
Gross unrealized appreciation ..................... $ 19,398,856 $ 18,628,854
Gross unrealized depreciation ..................... (1,486,356) (1,109,614)
------------ ------------
Net unrealized appreciation ....................... 17,912,500 17,519,240
Undistributed ordinary income ..................... 543,912 487,038
Undistributed long-term gains ..................... 2,802,938 2,385,855
Other temporary differences ....................... (4,806) (31,550)
------------ ------------
Total distibutable earnings ....................... $ 21,254,544 $ 20,360,583
============ ============
- ---------------------------------------------------------------------------------
20
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for the FBP Balanced Fund is due to certain
differences in the recognition of capital gains and losses under income tax
regulations and accounting principles generally accepted in the United States.
These "book/tax" differences are temporary in nature and are primarily due to
differing methods in the amortization of discounts and premiums on fixed income
securities.
2. INVESTMENT TRANSACTIONS
During the six months ended September 30, 2007, cost of purchases and proceeds
from sales and maturities of investment securities, other than short-term
investments and U.S. government securities, amounted to $7,697,904 and
$10,901,026, respectively, for the FBP Value Fund and $8,264,808 and $9,921,157,
respectively, for the FBP Balanced Fund.
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Funds' investments are managed by Flippin, Bruce & Porter, Inc. (the
Adviser) under the terms of an Investment Advisory Agreement. Under the
Investment Advisory Agreement, each Fund pays the Adviser a fee, which is
computed and accrued daily and paid monthly, at an annual rate of .70% of its
average daily net assets up to $250 million; .65% of the next $250 million of
such net assets; and .50% of such net assets in excess of $500 million. Certain
Trustees and officers of the Trust are also officers of the Adviser.
MUTUAL FUND SERVICES AGREEMENT
Under the terms of a Mutual Fund Services Agreement between the Trust and
Ultimus Fund Solutions, LLC (Ultimus), Ultimus provides administrative, pricing,
accounting, dividend disbursing, shareholder servicing and transfer agent
services for the Funds. For these services, Ultimus receives a monthly fee from
each Fund at an annual rate of .15% of its average daily net assets up to $25
million; .125% of the next $25 million of such net assets; and .10% of such net
assets in excess of $50 million, plus a shareholder recordkeeping fee at the
annual rate of $10 per shareholder account in excess of 1,000 accounts. In
addition, each Fund pays out-of-pocket expenses including, but not limited to,
postage, supplies and costs of pricing the Funds' portfolio securities. Certain
officers of the Trust are also officers of Ultimus, or of Ultimus Fund
Distributors, LLC (the Distributor), the principal underwriter of each Fund's
shares. The Distributor is compensated by the Adviser (not the Funds) for acting
as principal underwriter.
COMPLIANCE CONSULTING AGREEMENT
Under the terms of a Compliance Consulting Agreement between the Trust and
Ultimus, Ultimus provides an individual to serve as the Trust's Chief Compliance
Officer and to administer the Trust's compliance policies and procedures. For
these services, the Funds pay Ultimus an annual base fee of $16,800 plus an
asset-based fee equal to 0.01% per annum on total net assets in excess of $100
million.
4. COVERED CALL OPTIONS
A summary of covered call option contracts during the six months ended September
30, 2007 is as follows:
- -----------------------------------------------------------------------------------
FBP FBP
VALUE FUND BALANCED FUND
- -----------------------------------------------------------------------------------
OPTION OPTION OPTION OPTION
CONTRACTS PREMIUMS CONTRACTS PREMIUMS
- -----------------------------------------------------------------------------------
Options outstanding at
beginning of period .............. 90 $ 33,479 96 $ 31,721
Options written .................... 470 107,666 416 97,293
Options exercised .................. (40) (21,879) (30) (16,409)
Options expired .................... (50) (11,600) (66) (15,312)
--------- --------- --------- ---------
Options outstanding at end of period 470 $ 107,666 416 $ 97,293
========= ========= ========= =========
- -----------------------------------------------------------------------------------
21
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
5. CONTINGENCIES AND COMMITMENTS
The Funds indemnify the Trust's officers and trustees for certain liabilities
that might arise from their performance of their duties to the Funds.
Additionally, in the normal course of business the Funds enter into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Funds' maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Funds that have not yet occurred. However, based on experience, the Funds expect
the risk of loss to be remote.
6. ACCOUNTING PRONOUNCEMENTS
On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB
Interpretation No. 48 (FIN 48) "Accounting for Uncertainty in Income Taxes." FIN
48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken in the course of preparing the Funds' tax
returns to determine whether the tax positions are "more-likely-than-not" of
being sustained by the applicable tax authority. Tax positions not deemed to
meet the more-likely-than-not threshold would be recorded as a tax benefit or
expense in the current year. Adoption of FIN 48 is required for fiscal years
beginning after December 15, 2006 and is to be applied to all open tax years as
of the effective date. As a result, the Funds have adopted FIN 48 with this
Semi-Annual report. Based on its analysis, management does not believe that the
adoption of FIN 48 has a material impact on the financial statements.
In September 2006, the Financial Accounting Standards Board issued Statement on
Financial Accounting Standards (SFAS) No. 157, "Fair Value Measurements." This
standard establishes a single authoritative definition of fair value, sets out a
framework for measuring fair value and requires additional disclosures about
fair value measurements. SFAS No. 157 applies to fair value measurements already
required or permitted by existing standards. SFAS No. 157 is effective for
financial statements issued for fiscal years beginning after November 15, 2007
and interim periods within those fiscal years. The changes to current generally
accepted accounting principles from the application of SFAS No. 157 relate to
the definition of fair value, the methods used to measure fair value, and the
expanded disclosures about fair value measurements. As of September 30, 2007,
the Funds do not believe the adoption of SFAS No. 157 will impact the amounts
reported in the financial statements. However, additional disclosures may be
required about the inputs used to develop the measurements and the effect of
certain of the measurements reported on the statement of changes in net assets
for a fiscal period.
22
THE FLIPPIN BRUCE & PORTER FUNDS
ABOUT YOUR FUNDS' EXPENSES (UNAUDITED)
================================================================================
We believe it is important for you to understand the impact of costs on your
investment. All mutual funds have operating expenses. As a shareholder of the
Funds, you incur ongoing costs, including management fees and other fund
expenses. Operating expenses, which are deducted from each Fund's gross income,
directly reduce the investment return of the Funds.
A mutual fund's ongoing costs are expressed as a percentage of its average net
assets. This figure is known as the expense ratio. The following examples are
intended to help you understand the ongoing costs (in dollars) of investing in
the Funds and to compare these costs with the ongoing costs of investing in
other mutual funds. The examples 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 Fund'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
Fund'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
Funds. 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 Funds under the heading "Expenses Paid During Period."
Hypothetical 5% return - This section is intended to help you compare the Funds'
costs with those of other mutual funds. It assumes that each Fund 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 Funds' 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
Fund'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 Funds do not charge transaction fees, such as
purchase or redemption fees, nor do they carry a "sales load."
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.
More information about the Funds' expenses, including annual expense ratios for
the prior five fiscal years, can be found in this report. For additional
information on operating expenses and other shareholder costs, please refer to
the Funds' prospectus.
FBP VALUE FUND
- -------------------------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
April 1, 2007 September 30, 2007 During Period*
- -------------------------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,036.90 $5.06
- -------------------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,020.10 $5.01
- -------------------------------------------------------------------------------------------------
* Expenses are equal to the FBP Value Fund's annualized expense ratio of
0.99% for the period, multiplied by the average account value over the
period, multiplied by 183/365 (to reflect the one-half year period).
23
THE FLIPPIN BRUCE & PORTER FUNDS
ABOUT YOUR FUNDS' EXPENSES (UNAUDITED)
(CONTINUED)
==================================================================================
FBP BALANCED FUND
- -----------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
April 1, 2007 September 30, 2007 During Period*
- -----------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,035.80 $4.90
- -----------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,020.26 $4.86
- -----------------------------------------------------------------------------------
* Expenses are equal to the FBP Balanced Fund's annualized expense ratio of
0.96% for the period, multiplied by the average account value over the
period, multiplied by 183/365 (to reflect the one-half year period).
OTHER INFORMATION (UNAUDITED)
================================================================================
The Trust files a complete listing of portfolio holdings for the Funds with the
Securities and Exchange Commission (the SEC) as of the first and third quarters
of each fiscal year on Form N-Q. The filings are available upon request, by
calling 1-800-327-9375. Furthermore, you may obtain a copy of these filings on
the SEC's website at http://www.sec.gov. The Trust's Forms N-Q may also be
reviewed and copied at the SEC's Public Reference Room in Washington, DC, and
information on the operation of the Public Reference Room may be obtained by
calling 1-800-SEC-0330.
A description of the policies and procedures that the Funds use to determine how
to vote proxies relating to portfolio securities is available without charge
upon request by calling toll-free 1-800-327-9375, or on the SEC's website at
http://www.sec.gov. Information regarding how the Funds voted proxies relating
to portfolio securities during the most recent 12-month period ended June 30 is
also available without charge upon request by calling toll-free 1-800-327-9375,
or on the SEC's website at http://www.sec.gov.
24
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THE
FLIPPIN, BRUCE & PORTER
FUNDS
---------------------------------
INVESTMENT ADVISER
Flippin, Bruce & Porter, Inc.
800 Main Street, Second Floor
P.O. Box 6138
Lynchburg, Virginia 24505
TOLL-FREE 1-800-327-9375
WWW.FBPINC.COM
ADMINISTRATOR
Ultimus Fund Solutions, LLC
P.O. Box 46707
Cincinnati, Ohio 45246-0707
TOLL-FREE 1-866-738-1127
CUSTODIAN
US Bank
425 Walnut Street
Cincinnati, Ohio 45202
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
Ernst & Young LLP
1900 Scripps Center
312 Walnut Street
Cincinnati, Ohio 45202
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
OFFICERS
John T. Bruce, President
and Portfolio Manager
John M. Flippin, Vice President
R. Gregory Porter, III,
Vice President
John H. Hanna, IV, Vice President
David J. Marshall, Vice President
TRUSTEES
Austin Brockenbrough, III
John T. Bruce
Charles M. Caravati, Jr.
Robert S. Harris
J. Finley Lee, Jr.
Richard L. Morrill
Harris V. Morrissette
Erwin H. Will, Jr.
Samuel B. Witt, III
================================================================================
THE
JAMESTOWN
FUNDS
NO-LOAD FUNDS
THE JAMESTOWN BALANCED FUND
THE JAMESTOWN EQUITY FUND
THE JAMESTOWN SELECT FUND
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
THE JAMESTOWN INTERNATIONAL EQUITY FUND
SEMI-ANNUAL REPORT
SEPTEMBER 30, 2007
(UNAUDITED)
Investment Adviser
LOWE, BROCKENBROUGH & COMPANY, INC.
RICHMOND, VIRGINIA
================================================================================
THE JAMESTOWN BALANCED FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
ASSET ALLOCATION
- ----------------------------------- % OF
TEN LARGEST EQUITY HOLDINGS NET ASSETS
-------------------------------------------
[PIE CHART OMITTED] Cisco Systems, Inc. 1.9%
General Electric Company 1.8%
0.6% - Cash Equivalents PepsiCo, Inc. 1.6%
28.8% - Fixed Income Microsoft Corporation 1.4%
70.6% - Common Stocks Schlumberger Ltd. 1.3%
Bank of America Corporation 1.3%
Chevron Corporation 1.2%
AT&T, Inc. 1.2%
American International Group, Inc. 1.2%
NVIDIA Corporation 1.2%
EQUITY SECTOR CONCENTRATION VS. THE S&P 500 INDEX (70.6% OF NET ASSETS)
- --------------------------------------------------------------------------------
[BAR CHART OMITTED]
(% of Net Assets)
The
Jamestown
Balanced S&P 500
Fund Index
---------- ---------
Consumer Discretionary 8.4% 9.2%
Consumer Staples 7.9% 9.5%
Energy 10.0% 11.7%
Financials 15.1% 19.8%
Health Care 13.6% 11.6%
Industrials 16.9% 11.5%
Information Technology 20.8% 16.2%
Materials 3.7% 3.2%
Telecommunications Services 3.0% 3.8%
Utilities 0.7% 3.4%
FIXED-INCOME PORTFOLIO (28.8% OF NET ASSETS) SECTOR BREAKDOWN
- -------------------------------------------- -------------------------------
Average Stated Maturity (Years) 4.4 U.S. Treasury 9.5%
Average Duration (Years) 3.4 U.S. Government Agency 22.4%
Average Coupon 5.89% Mortgage-Backed 19.9%
Average Yield to Maturity 5.11% Corporate 48.2%
CREDIT QUALITY % OF FIXED INCOME PORTFOLIO
-----------------------------------------------------
AAA 51.0%
AA 6.0%
A 31.0%
BAA 12.0%
3
THE JAMESTOWN EQUITY FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
ASSET ALLOCATION
- ----------------------------------- % OF
TEN LARGEST EQUITY HOLDINGS NET ASSETS
-------------------------------------------
[PIE CHART OMITTED] Cisco Systems, Inc. 2.4%
General Electric Company 2.3%
100.00% - Common Stocks PepsiCo, Inc. 2.0%
Microsoft Corporation 1.9%
Schlumberger Ltd. 1.9%
AT&T, Inc. 1.7%
Chevron Corporation 1.7%
American International Group, Inc. 1.7%
CVS Caremark Corporation 1.6%
Bank of America Corporation 1.6%
SECTOR CONCENTRATION VS. THE S&P 500 INDEX
- --------------------------------------------------------------------------------
[BAR CHART OMITTED]
(% of Net Assets)
The
Jamestown
Equity S&P 500
Fund Index
--------- -------
Consumer Discretionary 8.8% 9.2%
Consumer Staples 8.4% 9.5%
Energy 10.1% 11.7%
Financials 14.7% 19.8%
Health Care 13.7% 11.6%
Industrials 16.2% 11.5%
Information Technology 20.3% 16.2%
Materials 3.6% 3.2%
Telecommunications Services 2.9% 3.8%
Utilities 1.3% 3.4%
4
THE JAMESTOWN SELECT FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
ASSET ALLOCATION
- ----------------------------------- % OF
TEN LARGEST EQUITY HOLDINGS NET ASSETS
--------------------------------------------
[PIE CHART OMITTED] Schlumberger Ltd. 2.1%
Cameron International Corporation 2.0%
98.5% - Common Stocks Express Scripts, Inc. 1,8%
1.5% - Cash Equivalents Freeport-McMoRan Copper & Gold, Inc. 1.7%
Precision Castparts Corporation 1.7%
Thermo Fisher Scientific, Inc. 1.6%
McDonald's Corporation 1.6%
Transocean, Inc. 1.6%
Deere & Company 1.6%
Hewlett-Packard Company 1.6%
SECTOR CONCENTRATION VS. THE S&P 500 INDEX
- --------------------------------------------------------------------------------
[BAR CHART OMITTED]
(% of Net Assets)
The
Jamestown
Select S&P 500
Fund Index
----------- ---------
Consumer Discretionary 8.8% 9.2%
Consumer Staples 5.6% 9.5%
Energy 9.6% 11.7%
Financials 14.9% 19.8%
Health Care 14.6% 11.7%
Industrials 15.9% 11.5%
Information Technology 20.4% 16.2%
Materials 6.0% 3.2%
Telecommunications Services 1.5% 3.8%
Utilities 1.2% 3.4%
Cash Equivalents 1.5% 0.0%
5
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
CHARACTERISTICS
(WEIGHTED AVERAGE) MATURITY BREAKDOWN (% OF PORTFOLIO)
- ------------------------------------ ---------------------------------------
30-day SEC Yield 3.34% [BAR CHART OMITTED]
Tax-Equivalent Yield 5.14%*
Average Maturity (Years) 4.2 0-2 Years 18%
Average Duration (Years) 3.6 2-5 Years 32%
Average Quality AA+ 5-10 Years 49%
Number of Issues 38 10+ Years 1%
* Assumes a maximum 35.0% federal tax rate.
CREDIT QUALITY (% OF PORTFOLIO) SECTOR DIVERSIFICATION (% OF PORTFOLIO)
- ------------------------------------ ---------------------------------------
[PIE CHART OMITTED] [PIE CHART OMITTED]
65.2% - AAA 54.9% - Revenues
34.8% - AA 17.0% - Government Guaranteed
1.8% - Floating Rate Notes
26.3% - General Obligations
6
THE JAMESTOWN INTERNATIONAL EQUITY FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
ASSET ALLOCATION
- ------------------------------- % OF
TEN LARGEST HOLDINGS COUNTRY NET ASSETS
-----------------------------------------------
[PIE CHART OMITTED] SAP AG Germany 3.7%
Koninkijke (Royal)
99.5% - Common Stocks KPN NV Netherlands 2.5%
0.5% - Cash Equivalents Repsol YPF SA Spain 2.3%
Mitsubishi Estate
Company Ltd. Japan 2.3%
Siemens AG Germany 2.2%
Suez SA France 2.1%
ENI SpA Italy 2.0%
GlaxoSmithKline PLC United Kingdom 2.0%
Royal Dutch Shell
PLC - Class A United Kingdom 2.0%
Allianz AG Germany 1.6%
GEOGRAPHIC DIVERSIFICATION VS. THE MORGAN STANLEY EAFE INDEX
- --------------------------------------------------------------------------------
[BAR CHART OMITTED]
The
Jamestown Morgan
International Stanley
Equity EAFE
Fund Index
--------------- -----------
Belgium 1.0% 1.3%
Denmark 1.0% 0.9%
Finland 1.9% 1.9%
France 11.5% 10.2%
Germany 14.1% 8.5%
Greece 1.4% 0.8%
Italy 4.9% 3.8%
Japan 22.2% 20.6%
Netherlands 6.5% 3.6%
Norway 1.2% 1.1%
Poland 0.4% 0.0%
Portugal 0.6% 0.4%
Singapore 2.0% 1.1%
South Korea 0.9% 0.0%
Spain 3.5% 4.2%
Sweden 2.5% 2.6%
Switzerland 5.4% 6.6%
United Kingdom 18.5% 22.3%
Other 0.0% 0.0%
Cash Equivalents 0.5% 0.0%
7
THE JAMESTOWN FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2007 (UNAUDITED)
===============================================================================================================
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY SELECT VIRGINIA EQUITY
FUND FUND FUND FUND FUND
- ---------------------------------------------------------------------------------------------------------------
ASSETS
Investments in securities:
At acquisition cost ............. $ 27,710,555 $ 27,351,839 $ 22,258,454 $ 26,999,294 $ 17,256,847
============ ============ ============ ============ ============
At value (Note 1) ............... $ 36,454,695 $ 38,848,451 $ 24,924,351 $ 27,385,215 $ 25,397,295
Cash .............................. -- -- -- -- 67,854
Cash denominated in
foreign currency(a) (Note 5) .... -- -- -- -- 4,609
Dividends and interest receivable . 148,769 23,456 18,364 347,976 49,099
Receivable for investment
securities sold ................. 138,880 288,681 289,713 -- 32,494
Receivable for capital shares
sold ............................ 63 -- -- 149,951 --
Other assets ...................... 3,147 9,526 10,040 6,583 3,774
------------ ------------ ------------ ------------ ------------
TOTAL ASSETS .................... 36,745,554 39,170,114 25,242,468 27,889,725 25,555,125
------------ ------------ ------------ ------------ ------------
LIABILITIES
Bank overdraft .................... -- -- -- 30,000 --
Distributions payable ............. 22,720 5,424 -- 12,370 664
Payable for securities purchased .. 566,970 388,803 657,970 -- --
Payable for capital shares redeemed 9,614 157,017 -- 10,496 4,445
Accrued investment advisory fees
(Note 3) ........................ 20,140 20,191 16,345 7,096 12,934
Accrued administration fees
(Note 3) ........................ 4,400 4,400 4,000 3,400 4,100
Accrued compliance fees (Note 3) .. 500 500 450 450 600
Net unrealized depreciation on
forward foreign currency
exchange contracts (Note 6) ..... -- -- -- -- 232
Other accrued expenses ............ 2,834 737 1,600 64 12,749
------------ ------------ ------------ ------------ ------------
TOTAL LIABILITIES ............... 627,178 577,072 680,365 63,876 35,724
------------ ------------ ------------ ------------ ------------
NET ASSETS .......................... $ 36,118,376 $ 38,593,042 $ 24,562,103 $ 27,825,849 $ 25,519,401
============ ============ ============ ============ ============
Net assets consist of:
Paid-in capital ................... $ 24,751,320 $ 25,623,762 $ 21,977,309 $ 27,411,486 $ 31,942,320
Accumulated undistributed net
investment income (loss) ........ 8,141 (467) (21,036) 14,221 68,282
Accumulated net realized gains
(losses) from security
transactions .................... 2,614,775 1,473,135 (60,067) 14,221 (14,632,639)
Net unrealized appreciation
on investments .................. 8,744,140 11,496,612 2,665,897 385,921 8,140,448
Net unrealized appreciation on
translation of assets and
liabilities in foreign
currencies ...................... -- -- -- -- 990
------------ ------------ ------------ ------------ ------------
Net assets .......................... $ 36,118,376 $ 38,593,042 $ 24,562,103 $ 27,825,849 $ 25,519,401
============ ============ ============ ============ ============
Shares of beneficial interest
outstanding (unlimited number
of shares authorized, no par
value) ............................ 2,306,301 1,903,270 2,110,242 2,769,250 1,691,629
============ ============ ============ ============ ============
Net asset value, offering price
and redemption price per share(b) . $ 15.66 $ 20.28 $ 11.64 $ 10.05 $ 15.09
============ ============ ============ ============ ============
(a) For Jamestown International Equity Fund, the cost of cash denominated in
foreign currency is $4,580.
(b) For Jamestown International Equity Fund, redemption price varies based on
length of time held (Note 1).
See accompanying notes to financial statements.
8
THE JAMESTOWN FUNDS
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2007 (UNAUDITED)
===============================================================================================================
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY SELECT VIRGINIA EQUITY
FUND FUND FUND FUND FUND
- ---------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Dividends ......................... $ 178,698 $ 221,368 $ 121,203 $ 12,707 $ 455,799
Foreign withholding taxes
on dividends .................... (337) (429) -- -- (63,509)
Interest .......................... 360,410 -- -- 693,458 --
------------ ------------ ------------ ------------ ------------
TOTAL INVESTMENT INCOME ......... 538,771 220,939 121,203 706,165 392,290
------------ ------------ ------------ ------------ ------------
EXPENSES
Investment advisory fees (Note 3) . 138,436 124,712 85,343 56,914 130,625
Administration fees (Note 3) ...... 29,798 27,171 24,000 20,952 26,008
Custodian fees .................... 8,134 5,007 6,321 1,910 29,632
Professional fees ................. 10,220 7,372 7,421 6,171 8,818
Trustees' fees and expenses ....... 6,288 6,288 6,288 6,288 6,288
Pricing costs ..................... 3,845 1,028 1,074 3,134 12,399
Compliance consulting fees (Note 3) 2,983 2,928 2,675 2,750 3,606
Postage and supplies .............. 1,459 2,746 1,716 1,990 2,041
Printing of shareholder reports ... 2,019 3,081 1,388 1,308 1,712
Registration fees ................. 1,231 1,883 3,725 685 1,952
Insurance expense ................. 1,614 1,402 783 1,053 1,129
Other expenses .................... -- 1,448 2,344 4,473 1,996
------------ ------------ ------------ ------------ ------------
TOTAL EXPENSES .................. 206,027 185,066 143,078 107,628 226,206
Fees waived by the Adviser
(Note 3) ........................ -- -- (839) (9,453) (38,106)
Expenses reimbursed through
a directed brokerage
arrangement (Note 4) ............ (10,000) (8,000) -- -- --
------------ ------------ ------------ ------------ ------------
NET EXPENSES .................... 196,027 177,066 142,239 98,175 188,100
------------ ------------ ------------ ------------ ------------
NET INVESTMENT INCOME (LOSS) ........ 342,744 43,873 (21,036) 607,990 204,190
------------ ------------ ------------ ------------ ------------
REALIZED AND UNREALIZED
GAINS (LOSSES) ON INVESTMENTS
AND FOREIGN CURRENCIES (NOTE 5)
Net realized gains (losses) from:
Security transactions ........... 2,663,968 1,507,352 (104,830) (90,311) 826,468
Foreign currency transactions ... -- -- -- -- 1,951
Net change in unrealized
appreciation/depreciation on:
Investments ..................... 508,820 2,798,567 1,877,866 (57,000) 276,521
Foreign currency translation .... -- -- -- -- 46
------------ ------------ ------------ ------------ ------------
NET REALIZED AND UNREALIZED
GAINS (LOSSES) ON INVESTMENTS
AND FOREIGN CURRENCIES ............ 3,172,788 4,305,919 1,773,036 (147,311) 1,104,986
------------ ------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS .................. $ 3,515,532 $ 4,349,792 $ 1,752,000 $ 460,679 $ 1,309,176
============ ============ ============ ============ ============
See accompanying notes to financial statements.
9
THE JAMESTOWN FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
===============================================================================================
JAMESTOWN JAMESTOWN
BALANCED FUND EQUITY FUND
---------------------------------------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
SEPT. 30, ENDED SEPT. 30, ENDED
2007 MARCH 31, 2007 MARCH 31,
(UNAUDITED) 2007 (UNAUDITED) 2007
- -----------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ............ $ 342,744 $ 924,950 $ 43,873 $ 205,568
Net realized gains on security
transactions ................... 2,663,968 3,640,165 1,507,352 3,061,081
Net change in unrealized
appreciation/depreciation
on investments ................. 508,820 (1,428,467) 2,798,567 (687,674)
------------ ------------ ------------ ------------
Net increase in net assets
from operations .................. 3,515,532 3,136,648 4,349,792 2,578,975
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ....... (355,435) (956,689) (47,723) (203,630)
From net realized gains from
security transactions .......... -- (3,490,662) -- (3,027,251)
------------ ------------ ------------ ------------
Net decrease in net assets from
distributions to shareholders .... (355,435) (4,447,351) (47,723) (3,230,881)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ........ 334,292 733,118 644,501 1,955,767
Net asset value of shares issued
in reinvestment of distributions
to shareholders ................ 310,058 4,156,986 42,299 2,926,496
Payments for shares redeemed ..... (13,146,327) (14,998,174) (3,523,682) (9,872,194)
------------ ------------ ------------ ------------
Net decrease in net assets from
capital share transactions ....... (12,501,977) (10,108,070) (2,836,882) (4,989,931)
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS .................... (9,341,880) (11,418,773) 1,465,187 (5,641,837)
NET ASSETS
Beginning of period .............. 45,460,256 56,879,029 37,127,855 42,769,692
------------ ------------ ------------ ------------
End of period .................... $ 36,118,376 $ 45,460,256 $ 38,593,042 $ 37,127,855
============ ============ ============ ============
ACCUMULATED UNDISTRIBUTED
(OVERDISTRIBUTED) NET
INVESTMENT INCOME ................ $ 8,141 $ 14,151 $ (467) $ 3,383
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ............................. 21,959 49,158 33,679 105,603
Reinvested ....................... 20,123 283,046 2,085 160,560
Redeemed ......................... (864,254) (1,002,168) (181,781) (534,434)
------------ ------------ ------------ ------------
Net decrease in shares outstanding (822,172) (669,964) (146,017) (268,271)
Shares outstanding, beginning
of period ...................... 3,128,473 3,798,437 2,049,287 2,317,558
------------ ------------ ------------ ------------
Shares outstanding, end of period 2,306,301 3,128,473 1,903,270 2,049,287
============ ============ ============ ============
See accompanying notes to financial statements.
10
THE JAMESTOWN FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
====================================================================================
JAMESTOWN
SELECT FUND
---------------------------
SIX MONTHS
ENDED PERIOD
SEPT. 30, ENDED
2007 MARCH 31,
(UNAUDITED) 2007 (a)
- ------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income (loss) ....................... $ (21,036) $ 18,607
Net realized gains (losses) on security transactions (104,830) 47,884
Net change in unrealized appreciation/
depreciation on investments ...................... 1,877,866 788,031
------------ ------------
Net increase in net assets from operations ............ 1,752,000 854,522
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ......................... -- (18,607)
From net realized gains from security transactions . -- (3,121)
------------ ------------
Net decrease in net assets from
distributions to shareholders ....................... -- (21,728)
------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold .......................... 3,873,814 18,357,722
Net asset value of shares issued in reinvestment
of distributions to shareholders ................. -- 21,278
Payments for shares redeemed ....................... (272,857) (2,648)
------------ ------------
Net increase in net assets from capital share
transactions ........................................ 3,600,957 18,376,352
------------ ------------
TOTAL INCREASE IN NET ASSETS .......................... 5,352,957 19,209,146
NET ASSETS
Beginning of period ................................ 19,209,146 --
------------ ------------
End of period ...................................... $ 24,562,103 $ 19,209,146
============ ============
ACCUMULATED NET INVESTMENT LOSS ....................... $ (21,036) $ --
============ ============
CAPITAL SHARE ACTIVITY
Sold ............................................... 345,256 1,787,340
Reinvested ......................................... -- 2,042
Redeemed ........................................... (24,146) (250)
------------ ------------
Net increase in shares outstanding ................. 321,110 1,789,132
Shares outstanding, beginning of period ............ 1,789,132 --
------------ ------------
Shares outstanding, end of period .................. 2,110,242 1,789,132
============ ============
(a) Represents the period from the commencement of operations (October 31,
2006) through March 31, 2007.
See accompanying notes to financial statements.
11
THE JAMESTOWN FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=====================================================================================================
JAMESTOWN TAX EXEMPT JAMESTOWN INTERNATIONAL
VIRGINIA FUND EQUITY FUND
---------------------------------------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
SEPT. 30, ENDED SEPT. 30, ENDED
2007 MARCH 31, 2007 MARCH 31,
(UNAUDITED) 2007 (UNAUDITED) 2007
- -----------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income .................. $ 607,990 $ 1,100,898 $ 204,190 $ 121,475
Net realized gains (losses) from:
Security transactions ................ (90,311) 20,776 826,468 916,382
Foreign currency transactions ........ -- -- 1,951 1,717
Net change in unrealized
appreciation/ depreciation on:
Investments .......................... (57,000) 13,207 276,521 2,074,541
Foreign currency translation ......... -- -- 46 897
------------ ------------ ------------ ------------
Net increase in net assets from operations 460,679 1,134,881 1,309,176 3,115,012
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ............. (509,039) (1,070,348) (137,859) (138,528)
From net realized gains from
security transactions ................ -- (36,397) -- --
In excess of net investment income ..... -- -- -- (6,400)
------------ ------------ ------------ ------------
Net decrease in net assets from
distributions to shareholders .......... (509,039) (1,106,745) (137,859) (144,928)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold .............. 1,111,107 2,492,050 282,069 3,834,061
Net asset value of shares issued
in reinvestment of distributions
to shareholders ...................... 413,332 879,398 134,154 138,102
Proceeds from redemption fees collected -- -- -- 290
Payments for shares redeemed ........... (2,631,154) (4,840,151) (2,057,953) (2,552,645)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets from
capital share transactions ............. (1,106,715) (1,468,703) (1,641,730) 1,419,808
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS .......................... (1,155,075) (1,440,567) (470,413) 4,389,892
NET ASSETS
Beginning of period .................... 28,980,924 30,421,491 25,989,814 21,599,922
------------ ------------ ------------ ------------
End of period .......................... $ 27,825,849 $ 28,980,924 $ 25,519,401 $ 25,989,814
============ ============ ============ ============
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME .................. $ 14,221 $ 13,101 $ 68,282 $ --
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ................................... 111,051 247,500 19,031 284,512
Reinvested ............................. 41,335 87,361 8,866 10,317
Redeemed ............................... (263,174) (481,104) (135,990) (188,193)
------------ ------------ ------------ ------------
Net increase (decrease) in shares
outstanding .......................... (110,788) (146,243) (108,093) 106,636
Shares outstanding, beginning of period 2,880,038 3,026,281 1,799,722 1,693,086
------------ ------------ ------------ ------------
Shares outstanding, end of period ...... 2,769,250 2,880,038 1,691,629 1,799,722
============ ============ ============ ============
See accompanying notes to financial statements.
12
THE JAMESTOWN BALANCED FUND
FINANCIAL HIGHLIGHTS
======================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
======================================================================================================================
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 -------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
- ----------------------------------------------------------------------------------------------------------------------
Net asset value at beginning
of period ....................... $ 14.53 $ 14.97 $ 14.92 $ 15.40 $ 13.76 $ 15.66
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment
operations:
Net investment income ........... 0.14 0.27 0.26 0.29 0.27 0.31
Net realized and unrealized
gains (losses) on investments . 1.13 0.69 1.06 0.14 2.48 (1.88)
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations .. 1.27 0.96 1.32 0.43 2.75 (1.57)
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment
income ........................ (0.14) (0.29) (0.27) (0.30) (0.29) (0.33)
Distributions from net realized
gains ......................... -- (1.11) (1.00) (0.61) (0.82) --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ............... (0.14) (1.40) (1.27) (0.91) (1.11) (0.33)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period .. $ 15.66 $ 14.53 $ 14.97 $ 14.92 $ 15.40 $ 13.76
========== ========== ========== ========== ========== ==========
Total return (a) .................. 8.76%(b) 6.57% 9.14% 2.83% 20.29% (10.06%)
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) $ 36,118 $ 45,460 $ 56,879 $ 62,235 $ 63,838 $ 65,339
========== ========== ========== ========== ========== ==========
Ratio of gross expenses to
average net assets .............. 0.97%(c) 0.94% 0.93% 0.92% 0.91% 0.90%
Ratio of net expenses to
average net assets(d) ........... 0.92%(c) 0.89% 0.89% 0.88% 0.88% 0.87%
Ratio of net investment income
to average net assets ........... 1.61%(c) 1.80% 1.72% 1.87% 1.77% 2.12%
Portfolio turnover rate ........... 12%(b) 40% 49% 29% 36% 38%
(a) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or
the redemption of Fund shares.
(b) Not annualized.
(c) Annualized.
(d) Ratios were determined based on net expenses after expense reimbursements
through a directed brokerage arrangement (Note 4).
See accompanying notes to financial statements.
13
THE JAMESTOWN EQUITY FUND
FINANCIAL HIGHLIGHTS
==============================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
==============================================================================================================================
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 ----------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning
of period ....................... $ 18.12 $ 18.45 $ 17.69 $ 18.28 $ 14.47 $ 18.40
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment
operations:
Net investment income ........... 0.03 0.10 0.07 0.12 0.05 0.04
Net realized and unrealized
gains (losses) on investments . 2.16 1.15 2.11 0.65 4.30 (3.93)
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations .. 2.19 1.25 2.18 0.77 4.35 (3.89)
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment
income ........................ (0.03) (0.10) (0.07) (0.12) (0.05) (0.04)
Distributions from net realized
gains ......................... -- (1.48) (1.35) (1.24) (0.49) --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ............... (0.03) (1.58) (1.42) (1.36) (0.54) (0.04)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period .. $ 20.28 $ 18.12 $ 18.45 $ 17.69 $ 18.28 $ 14.47
========== ========== ========== ========== ========== ==========
Total return(a) ................... 12.06%(b) 6.92% 12.69% 4.34% 30.10% (21.15%)
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) $ 38,593 $ 37,128 $ 42,770 $ 42,253 $ 50,187 $ 38,619
========== ========== ========== ========== ========== ==========
Ratio of gross expenses to
average net assets .............. 0.96%(c) 0.97% 0.97% 0.95% 0.94% 0.96%
Ratio of net expenses to
average net assets(d) ........... 0.92%(c) 0.91% 0.92% 0.90% 0.88% 0.89%
Ratio of net investment income
to average net assets ........... 0.23%(c) 0.52% 0.36% 0.63% 0.27% 0.25%
Portfolio turnover rate ........... 19%(b) 53% 60% 34% 52% 60%
(a) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or
the redemption of Fund shares.
(b) Not annualized.
(c) Annualized.
(d) Ratios were determined based on net expenses after expense reimbursements
through a directed brokerage arrangement (Note 4).
See accompanying notes to financial statements.
14
THE JAMESTOWN SELECT FUND
FINANCIAL HIGHLIGHTS
=======================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
=======================================================================================
SIX MONTHS
ENDED PERIOD
SEPT. 30, ENDED
2007 MARCH 31,
(UNAUDITED) 2007 (a)
- ---------------------------------------------------------------------------------------
Net asset value at beginning of period ............. $ 10.74 $ 10.00
------------ ------------
Income (loss) from investment operations:
Net investment income (loss) .................... (0.01) 0.01
Net realized and unrealized gains on
investments ................................... 0.91 0.75
------------ ------------
Total from investment operations ................... 0.90 0.76
------------ ------------
Less distributions:
Dividends from net investment income ............ -- (0.02)
------------ ------------
Net asset value at end of period ................... $ 11.64 $ 10.74
============ ============
Total return(b) .................................... 8.38%(c) 7.55%(c)
============ ============
Net assets at end of period (000's) ................ $ 24,562 $ 19,209
============ ============
Ratio of net expenses to average net assets(e) ..... 1.25%(d) 1.25%(d)
Ratio of net investment income (loss) to average
net assets ....................................... (0.18%)(d) 0.31%(d)
Portfolio turnover rate ............................ 48%(c) 46%(c)
(a) Represents the period from the commencement of operations (October 31,
2006) through March 31, 2007.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or
the redemption of Fund shares.
(c) Not annualized.
(d) Annualized.
(e) Absent investment advisory fees voluntarily waived by the Adviser, the
ratio of expenses to average net assets would have been 1.26%(d) for the
six months ended September 30, 2007 and 1.47%(d) for the period ended
March 31, 2007.
See accompanying notes to financial statements.
15
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
FINANCIAL HIGHLIGHTS
================================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
================================================================================================================================
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 ------------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
- --------------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning
of period ....................... $ 10.06 $ 10.05 $ 10.22 $ 10.57 $ 10.56 $ 10.12
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment
operations:
Net investment income ........... 0.18 0.37 0.36 0.37 0.37 0.38
Net realized and unrealized gains
(losses) on investments ........ (0.01) 0.01 (0.17) (0.35) 0.00(a) 0.44
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations .. 0.17 0.38 0.19 0.02 0.37 0.82
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment
income ........................ (0.18) (0.36) (0.36) (0.37) (0.36) (0.38)
Distributions from net realized
gains ......................... -- (0.01) -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ............... (0.18) (0.37) (0.36) (0.37) (0.36) (0.38)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period .. $ 10.05 $ 10.06 $ 10.05 $ 10.22 $ 10.57 $ 10.56
========== ========== ========== ========== ========== ==========
Total return(b) ................... 1.70%(c) 3.85% 1.83% 0.19% 3.61% 8.24%
========== ========== ========== ========== ========== ==========
Net assets at end of period
(000's) ......................... $ 27,826 $ 28,981 $ 30,421 $ 31,559 $ 33,602 $ 36,424
========== ========== ========== ========== ========== ==========
Ratio of net expenses to
average net assets(e) ........... 0.69%(d) 0.69% 0.69% 0.69% 0.69% 0.69%
Ratio of net investment income to
average net assets .............. 4.27%(d) 3.66% 3.50% 3.60% 3.46% 3.68%
Portfolio turnover rate ........... 0% 10% 22% 15% 43% 28%
(a) Represents less than a penny per share.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or
the redemption of Fund shares.
(c) Not annualized.
(d) Annualized.
(e) Absent investment advisory fees voluntarily waived by the Adviser, the
ratio of expenses to average net assets would have been 0.76%(d) for the
six months ended September 30, 2007 and 0.75%, 0.73%, 0.72%, 0.74% and
0.70% for the years ended March 31, 2007, 2006, 2005, 2004 and 2003,
respectively.
See accompanying notes to financial statements.
16
THE JAMESTOWN INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
==================================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
==================================================================================================================================
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 ----------------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning
of period ..................... $ 14.44 $ 12.76 $ 10.33 $ 9.42 $ 6.31 $ 8.98
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment
operations:
Net investment income ......... 0.12 0.07 0.10 0.08 0.05 0.06
Net realized and unrealized
gains (losses) on investments
and foreign currencies ....... 0.61 1.69 2.43 0.91 3.12 (2.69)
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations 0.73 1.76 2.53 0.99 3.17 (2.63)
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment
income ...................... (0.08) (0.08) (0.10) (0.08) (0.05) (0.05)
Distributions from net realized
gains ....................... -- -- -- -- (0.01) --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ............. (0.08) (0.08) (0.10) (0.08) (0.06) (0.05)
---------- ---------- ---------- ---------- ---------- ----------
Proceeds from redemption fees
collected ..................... -- 0.00(a) 0.00(a) -- 0.00(a) 0.01
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period $ 15.09 $ 14.44 $ 12.76 $ 10.33 $ 9.42 $ 6.31
========== ========== ========== ========== ========== ==========
Total return(b) ................. 5.05%(c) 13.86% 24.54% 10.51% 50.22% (29.18%)
========== ========== ========== ========== ========== ==========
Net assets at end of period
(000's) ....................... $ 25,519 $ 25,990 $ 21,600 $ 20,266 $ 21,158 $ 21,308
========== ========== ========== ========== ========== ==========
Ratio of net expenses to
average net assets(e) ......... 1.44%(d) 1.44% 1.44% 1.43% 1.38% 1.38%
Ratio of net investment income
to average net assets ......... 1.56%(d) 0.52% 0.89% 0.78% 0.57% 0.60%
Portfolio turnover rate ......... 6%(c) 13% 13% 111% 78% 56%
(a) Represents less than a penny per share.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or
the redemption of Fund shares.
(c) Not annualized.
(d) Annualized.
(e) Absent investment advisory fees voluntarily waived by the Adviser, the
ratio of expenses to average net assets would have been 1.73%(d) for the
six months ended September 30, 2007 and 1.75%, 1.87%, 1.92%, 1.77%, and
1.70% for the years ended March 31, 2007, 2006, 2005, 2004 and 2003,
respectively.
See accompanying notes to financial statements.
17
THE JAMESTOWN BALANCED FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 70.6% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 5.9%
5,000 American Eagle Outfitters, Inc..................... $ 131,550
4,900 J.C. Penney Company, Inc. ......................... 310,513
2,500 Johnson Controls, Inc. ............................ 295,275
6,700 McDonald's Corporation............................. 364,949
15,000 Staples, Inc. ..................................... 322,350
6,200 Target Corporation................................. 394,134
9,250 Walt Disney Company (The).......................... 318,108
------------
2,136,879
------------
CONSUMER STAPLES -- 5.5%
5,500 Coca-Cola Company (The)............................ 316,085
9,900 CVS Caremark Corporation........................... 392,337
6,300 Kroger Company (The)............................... 179,676
1,800 Molson Coors Brewing Company - Class B............. 179,406
7,700 PepsiCo, Inc....................................... 564,102
5,300 Procter & Gamble Company (The)..................... 372,802
------------
2,004,408
------------
ENERGY -- 7.1%
4,800 Chevron Corporation................................ 449,184
3,500 Exxon Mobil Corporation............................ 323,960
3,900 GlobalSantaFe Corporation.......................... 296,478
7,800 Noble Corporation.................................. 382,590
4,500 Schlumberger Ltd. ................................. 472,500
4,200 Smith International, Inc........................... 299,880
2,900 Transocean, Inc. (a)............................... 327,845
------------
2,552,437
------------
FINANCIALS -- 10.6%
6,300 American International Group, Inc.................. 426,195
9,000 Bank of America Corporation........................ 452,430
6,300 Chubb Corporation (The)............................ 337,932
6,350 Citigroup, Inc..................................... 296,355
2,800 Franklin Resources, Inc............................ 357,000
7,000 JPMorgan Chase & Company........................... 320,740
4,100 Merrill Lynch & Company, Inc. ..................... 292,248
5,000 MetLife, Inc....................................... 348,650
4,650 Morgan Stanley..................................... 292,950
4,000 Prudential Financial, Inc. ....................... 390,320
6,400 Travelers Companies, Inc. (The).................... 322,176
------------
3,836,996
------------
HEALTH CARE -- 9.6%
5,500 Aetna, Inc......................................... 298,485
6,600 Express Scripts, Inc. (a).......................... 368,412
5,000 Genzyme Corporation (a)............................ 309,800
8,050 Gilead Sciences, Inc. (a).......................... 329,003
5,200 Johnson & Johnson.................................. 341,640
5,550 McKesson Corporation............................... 326,285
4,500 Schering-Plough Corporation........................ 142,335
18
THE JAMESTOWN BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 70.6% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
HEALTH CARE -- 9.6% (CONTINUED)
8,700 Teva Pharmaceutical Industries Ltd. - ADR.......... $ 386,889
6,400 UnitedHealth Group, Inc............................ 309,952
5,000 WellPoint, Inc. (a)................................ 394,600
3,050 Zimmer Holdings, Inc. (a).......................... 247,019
------------
3,454,420
------------
INDUSTRIALS -- 12.0%
7,600 Dover Corporation.................................. 387,220
4,050 General Dynamics Corporation....................... 342,103
16,000 General Electric Company........................... 662,400
5,800 ITT Corporation.................................... 393,994
3,100 Lockheed Martin Corporation........................ 336,319
7,200 Norfolk Southern Corporation....................... 373,752
2,500 Parker-Hannifin Corporation........................ 279,575
4,000 Terex Corporation (a).............................. 356,080
6,450 Textron, Inc....................................... 401,255
7,200 Thermo Fisher Scientific, Inc. (a)................. 415,584
4,600 United Technologies Corporation.................... 370,208
------------
4,318,490
------------
INFORMATION TECHNOLOGY -- 14.7%
7,300 Accenture Ltd. - Class A .......................... 293,825
14,200 Applied Materials, Inc............................. 293,940
20,700 Cisco Systems, Inc. (a)............................ 685,377
15,300 Corning, Inc....................................... 377,145
650 Google, Inc. - Class A (a)......................... 368,725
5,500 Harris Corporation................................. 317,845
7,400 Hewlett-Packard Company............................ 368,446
3,150 International Business Machines Corporation........ 371,070
4,300 Lam Research Corporation (a)....................... 229,018
5,500 MEMC Electronic Materials, Inc. (a)................ 323,730
17,000 Microsoft Corporation ............................ 500,820
11,700 NVIDIA Corporation (a)............................. 424,008
18,000 Oracle Corporation (a)............................. 389,700
8,600 QUALCOMM, Inc...................................... 363,436
------------
5,307,085
------------
MATERIALS -- 2.6%
3,000 Allegheny Technologies, Inc. ...................... 329,850
2,800 Freeport-McMoRan Copper & Gold, Inc................ 293,692
3,800 Praxair, Inc....................................... 318,288
------------
941,830
------------
TELECOMMUNICATIONS SERVICES -- 2.1%
4,900 America Movil S.A. de C.V. - Series L - ADR........ 313,600
10,500 AT&T, Inc. ........................................ 444,255
------------
757,855
------------
UTILITIES -- 0.5%
2,000 Public Service Enterprise Group, Inc............... 175,980
------------
TOTAL COMMON STOCKS (Cost $16,889,338)............. $ 25,486,380
------------
19
THE JAMESTOWN BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
PAR VALUE U.S. TREASURY OBLIGATIONS -- 2.7% VALUE
- --------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 2.7%
$ 250,000 4.00%, due 02/15/2014.............................. $ 245,352
750,000 4.25%, due 11/15/2014.............................. 742,793
------------
TOTAL U.S. TREASURY OBLIGATIONS (Cost $995,720).... $ 988,145
------------
================================================================================
PAR VALUE U.S. GOVERNMENT AGENCY OBLIGATIONS -- 6.5% VALUE
- --------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 5.2%
$ 1,000,000 6.625%, due 09/15/2009 ............................ $ 1,041,342
300,000 5.125%, due 07/15/2012............................. 306,631
500,000 5.25%, due 04/18/2016.............................. 510,376
------------
1,858,349
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -- 1.3%
250,000 7.25%, due 01/15/2010.............................. 265,252
200,000 5.50%, due 03/15/2011.............................. 206,469
------------
471,721
------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $2,246,863).................................. $ 2,330,070
------------
================================================================================
PAR VALUE MORTGAGE-BACKED SECURITIES -- 5.7% VALUE
- --------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 1.4%
$ 5,112 Pool #1471, 7.00%, due 03/01/2008.................. $ 5,104
76,919 Pool #E00616, 6.00%, due 01/01/2014................ 77,908
28,020 Pool #E90624, 6.00%, due 08/01/2017................ 28,380
424,370 Pool #A43942, 5.50%, due 03/01/2036................ 415,592
------------
526,984
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -- 4.2%
229,235 Pool #618465, 5.00%, due 12/01/2016................ 224,691
295,083 Pool #684231, 5.00%, due 01/01/2018................ 289,235
273,740 Pool #255455, 5.00%, due 10/01/2024................ 264,573
448,654 Pool #255702, 5.00%, due 05/01/2025................ 433,182
298,450 Pool #808413, 5.50%, due 01/01/2035................ 292,332
------------
1,504,013
------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION -- 0.1%
40,887 Pool #781344, 6.50%, due 10/01/2031................ 41,797
------------
TOTAL MORTGAGE-BACKED SECURITIES (Cost $2,113,000). $ 2,072,794
------------
20
THE JAMESTOWN BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
PAR VALUE CORPORATE BONDS -- 13.9% VALUE
- --------------------------------------------------------------------------------
Alcoa, Inc.,
$ 250,000 6.50%, due 06/01/2011............................ $ 258,702
American Express Company,
150,000 4.875%, due 07/15/2013........................... 144,279
BB&T Corporation,
325,000 6.50%, due 08/01/2011............................ 337,499
Burlington Resources, Inc.,
350,000 6.68%, due 02/15/2011............................ 367,962
Deutsche Telekom AG,
300,000 8.00%, due 06/15/2010............................ 321,354
Dover Corporation,
345,000 6.50%, due 02/15/2011............................ 361,565
Duke Realty L.P., Medium Term Notes,
390,000 6.75%, due 05/30/2008............................ 394,184
FPL Group Capital, Inc.,
300,000 7.375%, due 06/01/2009........................... 311,387
Goldman Sachs Group, Inc.,
350,000 6.65%, due 05/15/2009............................ 358,918
GTE Northwest, Inc.,
300,000 6.30%, due 06/01/2010............................ 308,542
International Business Machines Corporation,
175,000 4.375%, due 06/01/2009........................... 174,781
JPMorgan Chase & Company,
300,000 6.75%, due 02/01/2011............................ 315,185
May Department Stores Company,
260,000 5.95%, due 11/01/2008............................ 260,272
Morgan Stanley,
250,000 5.30%, due 03/01/2013............................ 246,056
SunTrust Banks, Inc.
300,000 6.00%, due 01/15/2028............................ 301,201
Union Camp Corporation,
300,000 6.50%, due 11/15/2007............................ 300,190
United Technologies Corporation,
250,000 6.10%, due 05/15/2012............................ 260,465
------------
TOTAL CORPORATE BONDS (Cost $4,910,870)............ $ 5,022,542
------------
================================================================================
SHARES MONEY MARKET FUNDS -- 1.5% VALUE
- --------------------------------------------------------------------------------
554,764 Fidelity Institutional Money Market Portfolio
(Cost $554,764) ................................... $ 554,764
------------
TOTAL INVESTMENTS AT VALUE -- 100.9%
(Cost $27,710,555) ................................ $ 36,454,695
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.9%).... (336,319)
------------
NET ASSETS -- 100.0%............................... $ 36,118,376
============
(a) Non-income producing security.
ADR - American Depositary Receipt.
See accompanying notes to financial statements.
21
THE JAMESTOWN EQUITY FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 100.0% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 8.8%
14,000 American Eagle Outfitters, Inc..................... $ 368,340
7,800 J.C. Penney Company, Inc. ......................... 494,286
4,000 Johnson Controls, Inc. ............................ 472,440
9,900 McDonald's Corporation............................. 539,253
22,500 Staples, Inc. ..................................... 483,525
8,600 Target Corporation................................. 546,702
14,500 Walt Disney Company (The).......................... 498,655
------------
3,403,201
------------
CONSUMER STAPLES -- 8.4%
8,500 Coca-Cola Company (The)............................ 488,495
15,500 CVS Caremark Corporation........................... 614,265
10,000 Kroger Company (The)............................... 285,200
5,000 Molson Coors Brewing Company - Class B............. 498,350
10,750 PepsiCo, Inc....................................... 787,545
8,300 Procter & Gamble Company (The)..................... 583,822
------------
3,257,677
------------
ENERGY -- 10.1%
6,900 Chevron Corporation................................ 645,702
1,500 ConocoPhillips..................................... 131,655
5,000 Exxon Mobil Corporation............................ 462,800
6,400 GlobalSantaFe Corporation.......................... 486,528
10,000 Noble Corporation.................................. 490,500
7,000 Schlumberger Ltd. ................................. 735,000
6,200 Smith International, Inc........................... 442,680
4,300 Transocean, Inc. (a)............................... 486,115
------------
3,880,980
------------
FINANCIALS -- 14.7%
9,500 American International Group, Inc.................. 642,675
12,000 Bank of America Corporation ....................... 603,240
9,500 Chubb Corporation (The)............................ 509,580
10,500 Citigroup, Inc..................................... 490,035
4,200 Franklin Resources, Inc. .......................... 535,500
10,200 JPMorgan Chase & Company........................... 467,364
6,300 Merrill Lynch & Company, Inc. ..................... 449,064
7,500 MetLife, Inc....................................... 522,975
6,600 Morgan Stanley..................................... 415,800
5,600 Prudential Financial, Inc. ....................... 546,448
9,500 Travelers Companies, Inc. (The).................... 478,230
------------
5,660,911
------------
HEALTH CARE -- 13.7%
7,800 Aetna, Inc......................................... 423,306
10,000 Express Scripts, Inc. (a).......................... 558,200
7,800 Genzyme Corporation (a)............................ 483,288
12,500 Gilead Sciences, Inc. (a).......................... 510,875
7,200 Johnson & Johnson.................................. 473,040
8,600 McKesson Corporation............................... 505,594
10,500 Schering-Plough Corporation........................ 332,115
22
THE JAMESTOWN EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 100.0% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
HEALTH CARE -- 13.7% (CONTINUED)
13,000 Teva Pharmaceutical Industries Ltd. - ADR.......... $ 578,110
9,750 UnitedHealth Group, Inc............................ 472,192
7,100 WellPoint, Inc. (a)................................ 560,332
5,000 Zimmer Holdings, Inc. (a).......................... 404,950
------------
5,302,002
------------
INDUSTRIALS -- 16.2%
11,100 Dover Corporation.................................. 565,545
6,200 General Dynamics Corporation....................... 523,714
21,500 General Electric Company........................... 890,100
8,000 ITT Corporation.................................... 543,440
5,000 Lockheed Martin Corporation........................ 542,450
10,000 Norfolk Southern Corporation....................... 519,100
3,500 Parker-Hannifin Corporation........................ 391,405
6,300 Terex Corporation (a).............................. 560,826
9,400 Textron, Inc....................................... 584,774
10,000 Thermo Fisher Scientific, Inc. (a)................. 577,200
7,100 United Technologies Corporation.................... 571,408
------------
6,269,962
------------
INFORMATION TECHNOLOGY -- 20.3%
10,150 Accenture Ltd. - Class A .......................... 408,538
21,200 Applied Materials, Inc............................. 438,840
28,500 Cisco Systems, Inc. (a)............................ 943,635
24,000 Corning, Inc. ..................................... 591,600
1,000 Google, Inc. - Class A (a)......................... 567,270
8,250 Harris Corporation................................. 476,768
11,300 Hewlett-Packard Company............................ 562,627
4,800 International Business Machines Corporation........ 565,440
7,000 Lam Research Corporation (a)....................... 372,820
8,300 MEMC Electronic Materials, Inc. (a)................ 488,538
25,500 Microsoft Corporation ............................ 751,230
15,500 NVIDIA Corporation (a)............................. 561,720
26,250 Oracle Corporation (a)............................. 568,312
12,300 QUALCOMM, Inc...................................... 519,798
------------
7,817,136
------------
MATERIALS -- 3.6%
4,700 Allegheny Technologies, Inc........................ 516,765
4,500 Freeport-McMoRan Copper & Gold, Inc................ 472,005
5,000 Praxair, Inc....................................... 418,800
------------
1,407,570
------------
TELECOMMUNICATIONS SERVICES -- 2.9%
7,000 America Movil S.A. de C.V. - Series L - ADR........ 448,000
15,600 AT&T, Inc. ........................................ 660,036
------------
1,108,036
------------
UTILITIES -- 1.3%
5,600 Public Service Enterprise Group, Inc............... 492,744
------------
TOTAL COMMON STOCKS (Cost $27,103,607)............. $ 38,600,219
------------
23
THE JAMESTOWN EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES MONEY MARKET FUNDS -- 0.7% VALUE
- --------------------------------------------------------------------------------
248,232 Fidelity Institutional Money Market Portfolio
(Cost $248,232).................................... $ 248,232
------------
TOTAL INVESTMENTS AT VALUE -- 100.7%
(Cost $27,351,839)................................. $ 38,848,451
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.7%).... (255,409)
------------
NET ASSETS -- 100.0%............................... $ 38,593,042
============
(a) Non-income producing security.
ADR - American Depositary Receipt.
See accompanying notes to financial statements.
24
THE JAMESTOWN SELECT FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 98.5% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 8.8%
9,500 American Eagle Outfitters, Inc..................... $ 249,945
10,880 Hasbro, Inc........................................ 303,334
7,260 McDonald's Corporation............................. 395,452
5,660 NIKE, Inc. - Class B............................... 332,016
5,800 Snap-on, Inc....................................... 287,332
10,500 TJX Companies, Inc. (The).......................... 305,235
8,610 Walt Disney Company (The).......................... 296,098
------------
2,169,412
------------
CONSUMER STAPLES -- 5.6%
8,760 CVS Caremark Corporation........................... 347,159
12,330 Kroger Company (The)............................... 351,651
3,470 Molson Coors Brewing Company - Class B............. 345,855
4,500 Procter & Gamble Company (The)..................... 316,530
------------
1,361,195
------------
ENERGY -- 9.6%
5,240 Cameron International Corporation (a).............. 483,600
6,920 Grant Prideco, Inc. (a)............................ 377,278
6,140 Noble Corporation.................................. 301,167
4,890 Schlumberger Ltd................................... 513,450
4,200 Sunoco, Inc........................................ 297,276
3,460 Transocean, Inc. (a)............................... 391,153
------------
2,363,924
------------
FINANCIALS -- 14.9%
4,200 American International Group, Inc.................. 284,130
11,450 CB Richard Ellis Group, Inc. - Class A (a)......... 318,768
5,230 Chubb Corporation (The)............................ 280,537
6,430 Citigroup, Inc..................................... 300,088
1,530 Goldman Sachs Group, Inc. (The).................... 331,612
3,370 Hartford Financial Services Group, Inc. (The)...... 311,893
14,400 Host Hotels & Resorts, Inc......................... 323,136
5,700 JPMorgan Chase & Company........................... 261,174
3,545 Merrill Lynch & Company, Inc. ..................... 252,688
5,245 MetLife, Inc....................................... 365,734
3,320 Prudential Financial, Inc.......................... 323,966
6,165 Travelers Companies, Inc. (The).................... 310,346
------------
3,664,072
------------
HEALTH CARE -- 14.6%
5,745 Aetna, Inc......................................... 311,781
7,090 CIGNA Corporation.................................. 377,826
7,900 Express Scripts, Inc. (a).......................... 440,978
5,050 Genzyme Corporation (a)............................ 312,898
4,050 Johnson & Johnson.................................. 266,085
4,170 Laboratory Corporation of America Holdings (a)..... 326,219
5,910 McKesson Corporation............................... 347,449
3,690 Medco Health Solutions, Inc. (a)................... 333,539
25
THE JAMESTOWN SELECT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 98.5% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
HEALTH CARE -- 14.6% (CONTINUED)
6,150 Merck & Company, Inc............................... $ 317,894
5,660 UnitedHealth Group, Inc............................ 274,114
3,500 WellPoint, Inc. (a)................................ 276,220
------------
3,585,003
------------
INDUSTRIALS -- 15.9%
24,900 Allied Waste Industries, Inc. (a).................. 317,475
2,620 Deere & Company.................................... 388,860
6,700 Emerson Electric Company........................... 356,574
3,100 Energizer Holdings, Inc. (a)....................... 343,635
3,900 General Dynamics Corporation....................... 329,433
5,300 Goodrich Corporation............................... 361,619
3,250 Lockheed Martin Corporation........................ 352,593
3,375 Parker-Hannifin Corporation........................ 377,426
3,420 Terex Corporation (a).............................. 304,448
5,800 Textron, Inc....................................... 360,818
7,005 Thermo Fisher Scientific, Inc. (a)................. 404,329
------------
3,897,210
------------
INFORMATION TECHNOLOGY -- 20.4%
8,610 Accenture Ltd. - Class A .......................... 346,553
15,550 Applied Materials, Inc............................. 321,885
7,380 Avnet, Inc. (a).................................... 294,167
9,695 BMC Software, Inc. (a)............................. 302,775
11,500 Cisco Systems, Inc. (a)............................ 380,765
5,160 Computer Sciences Corporation (a).................. 288,444
12,700 Corning, Inc....................................... 313,055
6,420 Harris Corporation................................. 371,012
7,780 Hewlett-Packard Company............................ 387,366
2,930 International Business Machines Corporation........ 345,154
5,745 Lam Research Corporation (a)....................... 305,979
5,490 MEMC Electronic Materials, Inc. (a)................ 323,141
10,440 NVIDIA Corporation (a)............................. 378,345
16,895 Oracle Corporation (a)............................. 365,777
16,970 Xerox Corporation (a).............................. 294,260
------------
5,018,678
------------
MATERIALS -- 6.0%
3,010 Allegheny Technologies, Inc........................ 330,949
4,050 Freeport-McMoRan Copper & Gold, Inc................ 424,805
14,440 Hercules, Inc. ................................... 303,529
2,870 Precision Castparts Corporation.................... 424,703
------------
1,483,986
------------
TELECOMMUNICATIONS SERVICES -- 1.5%
8,595 AT&T, Inc. ........................................ 363,654
------------
UTILITIES -- 1.2%
6,180 Consolidated Edison, Inc........................... 286,134
------------
TOTAL COMMON STOCKS (Cost $21,527,371)............. $ 24,193,268
------------
26
THE JAMESTOWN SELECT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES MONEY MARKET FUNDS -- 3.0% VALUE
- --------------------------------------------------------------------------------
731,083 Fidelity Institutional Money Market Portfolio
(Cost $731,083).................................... $ 731,083
------------
TOTAL INVESTMENTS AT VALUE -- 101.5%
(Cost $22,258,454)................................. $ 24,924,351
LIABILITIES IN EXCESS OF OTHER ASSETS -- (1.5%).... (362,248)
------------
NET ASSETS -- 100.0%............................... $ 24,562,103
============
(a) Non-income producing security.
See accompanying notes to financial statements.
27
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
===========================================================================================
VIRGINIA REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 97.3% VALUE
- -------------------------------------------------------------------------------------------
Alexandria, Virginia, GO,
$ 1,000,000 5.00%, due 06/15/2011, prerefunded 06/15/2010 @ 101...... $ 1,047,560
Arlington Co., Virginia, GO,
500,000 4.10%, due 11/01/2018.................................... 505,015
Fairfax Co., Virginia, Economic Dev. Authority, Revenue,
1,000,000 5.00%, due 06/01/2018.................................... 1,061,390
Fairfax Co., Virginia, GO,
700,000 5.00%, due 10/01/2011.................................... 739,221
Fauquier Co., Virginia, GO,
500,000 5.00%, due 07/01/2017.................................... 542,765
Hampton, Virginia, GO,
1,000,000 5.50%, due 02/01/2012, prerefunded 02/01/2010 @ 102...... 1,062,510
Hanover Co., Virginia, GO,
1,000,000 5.125%, due 07/15/2013................................... 1,038,120
Hanover Co., Virginia, Industrial Dev. Authority, Revenue,
1,000,000 6.50%, due 08/15/2009.................................... 1,054,650
Henrico Co., Virginia, Economic Dev. Authority, Revenue,
1,000,000 5.50%, due 11/01/2008.................................... 1,021,200
James City, Virginia, School District, GO,
500,000 5.00%, due 12/15/2018.................................... 534,680
James City, Virginia, Service Authority, Water and Sewer, Revenue,
1,000,000 5.125%, due 01/15/2017................................... 1,074,660
Leesburg, Virginia, GO,
500,000 5.00%, due 09/15/2016.................................... 546,245
Loudoun Co., Virginia, GO,
500,000 5.00%, due 07/01/2012.................................... 532,360
Loudoun Co., Virginia, Industrial Dev. Authority,
Public Facility Lease, Revenue,
1,000,000 5.00%, due 03/01/2019.................................... 1,051,290
Loudoun Co., Virginia, Industrial Dev. Authority, Revenue,
500,000 3.84%, floating rate, due 02/15/2038..................... 500,000
Lynchburg, Virginia, GO,
500,000 5.00%, due 06/01/2015.................................... 541,740
Medical College of Virginia, Hospitals Authority, Revenue,
700,000 5.00%, due 07/01/2013.................................... 720,853
New Kent Co., Virginia, Economic Dev. Authority, Revenue,
500,000 5.00%, due 02/01/2019.................................... 532,170
Norfolk, Virginia, Water, Revenue,
1,000,000 5.00%, due 11/01/2016.................................... 1,050,070
Portsmouth, Virginia, GO,
290,000 5.00%, due 08/01/2017.................................... 293,208
Richmond, Virginia, GO,
1,000,000 5.45%, due 01/15/2008.................................... 1,005,860
Richmond, Virginia, Industrial Dev. Authority,
Government Facilities, Revenue,
510,000 4.75%, due 07/15/2010.................................... 525,448
Richmond, Virginia, Metropolitan Authority, Revenue,
1,000,000 5.25%, due 07/15/2014.................................... 1,094,170
28
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
===========================================================================================
VIRGINIA REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 97.3% (CONTINUED) VALUE
- -------------------------------------------------------------------------------------------
Southeastern Public Service Authority, Virginia, Revenue,
$ 1,000,000 5.00%, due 07/01/2015 ................................... $ 1,068,360
Spotsylvania Co., Virginia, GO,
500,000 5.00%, due 01/15/2016.................................... 534,420
Suffolk, Virginia, GO,
1,000,000 5.00%, due 12/01/2015.................................... 1,022,180
University of Virginia, Revenue,
1,000,000 5.25%, due 06/01/2012.................................... 1,036,780
Upper Occoquan, Virginia, Sewer Authority, Revenue,
250,000 5.15%, due 07/01/2020.................................... 274,295
Virginia Beach, Virginia, GO,
800,000 5.25%, due 08/01/2010.................................... 818,904
Virginia College Building Authority, Educational
Facilities, Revenue,
500,000 5.00%, due 02/01/2017.................................... 534,640
500,000 5.00%, due 04/01/2017.................................... 537,790
Virginia Commonwealth Transportation Board,
Federal Highway Reimbursement Anticipation Note, Revenue,
500,000 5.00%, due 09/28/2015.................................... 543,035
Virginia Polytechnic Institute & State University, Revenue,
500,000 5.00%, due 06/01/2016.................................... 539,930
Virginia State, GO,
500,000 5.00%, due 06/01/2012.................................... 531,795
Virginia State Public School Authority, Revenue,
995,000 5.25%, due 08/01/2009.................................... 1,026,830
Virginia State Resource Authority, Infrastructure Revenue,
400,000 5.50%, due 05/01/2017, prerefunded 05/01/10 @101......... 423,096
100,000 5.50%, due 05/01/2017.................................... 105,468
------------
TOTAL VIRGINIA REVENUE AND GENERAL
OBLIGATION (GO) BONDS (Cost $26,686,787)................. $ 27,072,708
------------
================================================================================
SHARES MONEY MARKET FUNDS -- 1.1% VALUE
- --------------------------------------------------------------------------------
312,507 Fidelity Institutional Tax-Exempt Portfolio
(Cost $312,507).................................... $ 312,507
------------
TOTAL INVESTMENTS AT VALUE -- 98.4%
(Cost $26,999,294)................................. $ 27,385,215
OTHER ASSETS IN EXCESS OF LIABILITIES -- 1.6%...... 440,634
------------
NET ASSETS -- 100.0%............................... $ 27,825,849
============
See accompanying notes to financial statements.
29
THE JAMESTOWN INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 99.5% VALUE
- --------------------------------------------------------------------------------
BELGIUM -- 1.0%
4,467 UCB SA (b)......................................... $ 262,388
------------
DENMARK -- 1.0%
2,191 Novo Nordisk A/S - Class B (b)..................... 264,295
------------
FINLAND -- 1.9%
9,065 Nokia Oyj (a) (b).................................. 343,042
3,888 Nokia Oyj - ADR.................................... 147,472
------------
490,514
------------
FRANCE -- 11.5%
16,539 Alcatel SA (b)..................................... 168,294
6,166 Business Objects SA - ADR (a)...................... 276,668
4,194 Carrefour SA (b)................................... 292,804
1,402 Casino Guichard-Perrachon SA (b)................... 146,627
2,852 Compagnie de Saint-Gobain (a) (b).................. 297,010
4,230 France Telecom SA (b).............................. 140,820
1,601 PPR SA (b)......................................... 300,353
2,130 Sanofi-Aventis (b) ............................... 180,033
9,158 Suez SA (b)........................................ 536,748
4,710 Total SA (b)....................................... 380,650
5,269 Vivendi Universal SA (b)........................... 222,054
------------
2,942,061
------------
GERMANY -- 14.1%
1,755 Allianz AG (b)..................................... 407,707
2,729 Arcandor AG (a) (b)................................ 90,405
4,116 Bayer AG (b)....................................... 325,698
2,772 Deustche Bank AG (b)............................... 355,074
3,030 Deustche Postbank AG (b) .......................... 221,591
5,251 Infineon Technologies AG (a) (b)................... 90,051
952 Merck KGaA (b)..................................... 115,742
2,599 Metro AG (b)....................................... 233,588
1,392 Muencher Rueckversicherungs-Gesellschaft AG (b).... 265,766
16,050 SAP AG (b)......................................... 937,218
4,155 Siemens AG (b)..................................... 567,357
------------
3,610,197
------------
GREECE -- 1.4%
9,410 Hellenic Telecommunications Organization SA (b) ... 348,667
------------
ITALY -- 4.9%
6,669 Assicurazioni Generali SpA (b)..................... 292,345
23,663 Enel SpA (b)....................................... 266,314
14,158 ENI SpA (b)........................................ 521,431
21,647 UniCredito Italiano SpA (b)........................ 184,822
------------
1,264,912
------------
30
THE JAMESTOWN INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 99.5% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
JAPAN -- 22.2%
29,000 Bank of Yokohama, Ltd. (b)......................... $ 198,890
8,700 Bridgestone Corporation (b)........................ 191,269
3,550 Canon, Inc. (b) .................................. 192,391
14,000 Daiwa Securities Group, Inc. (b)................... 132,303
37 East Japan Railway Company (b)..................... 291,317
1,300 FANUC LTD. (b)..................................... 131,802
2,800 FAST RETAILING COMPANY LTD. (b).................... 160,983
7,900 JSR Corporation (b)................................ 192,648
1,250 KEYENCE CORPORATION (b)............................ 276,278
8,500 MARUI COMPANY LTD. (b)............................. 93,441
12,000 Matsushita Electric Industrial Company Ltd. (b).... 222,632
8,400 Millea Holdings, Inc. (b).......................... 336,032
21,000 Mitsubishi Estate Company Ltd. (b)................. 597,762
40 Mitsubishi UFJ Financial Group, Inc. ............. 363,972
19,200 Nomura Holdings, Inc. (b) ........................ 318,996
73 NTT Data Corporation (b)........................... 323,962
105 NTT DoCoMo, Inc. (b)............................... 149,057
13,500 PIONEER CORPORATION (b)............................ 164,805
3,800 SECOM COMPANY LTD. (b)............................. 181,989
8,100 Seven & I Holdings Company Ltd. (a) (b)............ 207,293
13,000 Sharp Corporation (b).............................. 234,649
42 Sumitomo Mitsui Financial Group, Inc. (b).......... 325,420
3,300 T&D Holdings, Inc. (b)............................. 201,856
1,900 TDK CORPORATION (b)................................ 166,361
------------
5,656,108
------------
NETHERLANDS -- 6.5%
7,127 Aegon NV (b)....................................... 135,924
3,270 Akzo Nobel NV (b).................................. 268,770
6,390 Fortis (b)......................................... 187,881
4,649 ING Groep NV (b)................................... 206,049
36,766 Koninklijke (Royal) KPN NV (a) (b) ............... 635,445
4,950 Koninklijke (Royal) Philips Electronics NV (b) .... 222,154
------------
1,656,223
------------
NORWAY -- 1.2%
8,912 Statoil ASA (b).................................... 302,374
------------
POLAND -- 0.4%
4,555 Powszechna Kasa Oszczednosci Bank Polski SA (a) (b) 94,464
------------
PORTUGAL -- 0.6%
26,245 EDP - Energias de Portugal SA (b).................. 153,068
------------
SINGAPORE -- 2.0%
26,000 DBS Group Holdings Ltd. (b)........................ 376,979
90,000 Synear Food Holdings Ltd. (b)...................... 125,240
------------
502,219
------------
SOUTH KOREA -- 0.9%
2,720 Hyundai Motor Company (b).......................... 219,097
------------
31
THE JAMESTOWN INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 99.5% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
SPAIN -- 3.5%
16,895 Repsol YPF SA (b) ................................. $ 599,592
10,627 Telefonica SA (a) (b).............................. 296,109
------------
895,701
------------
SWEDEN -- 2.5%
23,059 Nordea Bank AB (b)................................. 398,778
58,024 Telefonaktiebolaget LM Ericsson - B Shares (a) (b). 230,104
------------
628,882
------------
SWITZERLAND -- 5.4%
4,338 Credit Suisse Group (b)............................ 287,346
549 Nestle SA (b)...................................... 245,279
6,420 Novartis AG (b).................................... 351,991
1,565 Roche Holdings AG (b).............................. 282,420
1,004 Swiss Re (b)....................................... 88,983
440 Zurich Financial Services AG (b)................... 131,455
------------
1,387,474
------------
UNITED KINGDOM -- 18.5%
2,912 Anglo American PLC (b)............................. 194,247
24,591 BAE Systems PLC (b)................................ 246,198
4,999 Berkeley Group (The) PLC (a) (b)................... 145,689
21,615 Cadbury Schweppes PLC (b).......................... 250,546
2,142 Carnival PLC (b)................................... 101,772
19,620 GlaxoSmithKline PLC (b)............................ 518,587
27,226 Imperial Chemical Industries PLC (b)............... 359,485
34,061 J Sainsbury PLC (b)................................ 401,235
38,818 Kingfisher PLC (b)................................. 141,445
4,876 Land Securities Group PLC (b)...................... 166,801
22,922 Lloyds TSB Group PLC (b)........................... 252,521
20,874 Prudential PLC (b)................................. 318,576
22,735 Rolls-Royce Group PLC (b).......................... 241,677
12,429 Royal Dutch Shell PLC - Class A (a) (b) .......... 510,694
6,703 Royal Dutch Shell PLC - Class B (a) (b) ........... 274,010
6,417 Smiths Group PLC (b) .............................. 139,884
6,916 Whitbread PLC (b).................................. 228,816
33,394 William Morrison Supermarkets PLC (b).............. 191,929
95,416 Woolworths Group PLC (b)........................... 34,539
------------
4,718,651
------------
TOTAL COMMON STOCKS -- 99.5% (Cost $17,256,847).... $ 25,397,295
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.5%...... 122,106
------------
NET ASSETS -- 100.0%............................... $ 25,519,401
============
(a) Non-income producing security.
(b) Fair value priced (Note 1). Fair valued securities totaled $24,609,183 at
September 30, 2007, representing 96.4% of net assets.
ADR - American Depositary Receipt.
See accompanying notes to financial statements.
32
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The Jamestown Balanced Fund, The Jamestown Equity Fund, The Jamestown Select
Fund, The Jamestown Tax Exempt Virginia Fund and The Jamestown International
Equity Fund (individually, a Fund, and, collectively, the Funds) are each a
no-load series of the Williamsburg Investment Trust (the Trust), an open-end
management investment company registered under the Investment Company Act of
1940. The Trust was organized as a Massachusetts business trust on July 18,
1988.
The Jamestown Balanced Fund's investment objectives are long-term growth of
capital and income through investment in a balanced portfolio of equity and
fixed income securities. Capital protection and low volatility are important
investment goals.
The Jamestown Equity Fund's investment objective is long-term growth of capital
through investment in a diversified portfolio composed primarily of common
stocks. Current income is incidental to this objective and may not be
significant.
The Jamestown Select Fund's investment objective is long-term growth of capital
through investment in a diversified portfolio composed primarily of common
stocks. Current income is incidental to this objective and may not be
significant.
The Jamestown Tax Exempt Virginia Fund's investment objectives are to provide
current income exempt from federal income taxes and from the personal income
taxes of Virginia, to preserve capital, to limit credit risk and to take
advantage of opportunities to increase and enhance the value of a shareholder's
investment.
The Jamestown International Equity Fund's investment objective is to achieve
superior total returns through investment in equity securities of issuers
located outside the United States of America.
The following is a summary of the Funds' significant accounting policies:
Securities valuation -- The Funds' portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern time). Securities traded on a national or foreign
stock exchange are generally valued based upon the closing price on the
principal exchange where the security is traded. Securities which are quoted by
NASDAQ are valued at the NASDAQ Official Closing Price. Securities which are
traded over-the-counter are valued at the last sales price, if available,
otherwise, at the last quoted bid price. It is expected that fixed income
securities will ordinarily be traded in the over-the-counter market, and common
stocks will ordinarily be traded on a national securities exchange, but may also
be traded in the over-the-counter market. Because the value of foreign
securities may be materially affected by events occurring before the Fund's
pricing time but after the close of the primary markets or exchanges on which
such securities are traded, portfolio securities of The Jamestown International
Equity Fund may be priced at their fair value as determined by an independent
pricing service approved by the Board of Trustees. As a result, the prices of
securities used to calculate The Jamestown International
33
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Equity Fund's NAV may differ from quoted or published prices for the same
securities. Foreign securities are translated from the local currency into U.S.
dollars using currency exchange rates supplied by a quotation service.
Short-term instruments (those with remaining maturities of 60 days or less) are
valued at amortized cost, which approximates market value.
When market quotations are not readily available, securities may be valued on
the basis of prices provided by an independent pricing service. The prices
provided by the pricing service are determined with consideration given to
institutional bid and last sale prices and take into account securities prices,
yields, maturities, call features, ratings, institutional trading in similar
groups of securities and developments related to specific securities. If a
pricing service cannot provide a valuation, securities will be valued in good
faith at fair value using methods consistent with those determined by the Board
of Trustees. Such methods of fair valuation may include, but are not limited to:
multiple of earnings, multiple of book value, discount from market of a similar
freely traded security, purchase price of security, subsequent private
transactions in the security or related securities, or a combination of these
and other factors.
Repurchase agreements -- The Funds may enter into joint repurchase agreements
with each other and with other funds within the Trust. The joint repurchase
agreement, which is collateralized by U.S. Government obligations, is valued at
cost which, together with accrued interest, approximates market. At the time the
Funds enter into the joint repurchase agreement, the seller agrees that the
value of the underlying securities, including accrued interest, will at all
times be equal to or exceed the face amount of the repurchase agreement. In
addition, each Fund actively monitors and seeks additional collateral, as
needed.
Share valuation -- The net asset value per share of each Fund is calculated
daily by dividing the total value of each Fund's assets, less liabilities, by
the number of shares outstanding. The offering price and redemption price per
share of each Fund is equal to the net asset value per share, except that shares
of The Jamestown International Equity Fund are subject to a redemption fee of 2%
if redeemed within 90 days of the date of purchase. For the periods ended
September 30, 2007 and March 31, 2007, proceeds from redemption fees totaled $0
and $290, respectively
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed income
securities purchased are amortized using the interest method.
Distributions to shareholders -- Dividends arising from net investment income,
if any, are declared and paid quarterly to shareholders of The Jamestown
Balanced Fund, The Jamestown Equity Fund, The Jamestown Select Fund and The
Jamestown International Equity Fund and are declared daily and paid monthly to
shareholders of The Jamestown Tax Exempt Virginia Fund. Net realized short-term
capital gains, if any, may be distributed throughout the year and net realized
long-term capital gains, if any, are distributed at least once each year. The
amount of distributions from net investment income and net realized gains are
determined in accordance with federal income tax regulations which may differ
from accounting principles generally accepted in the United States. These
"book/tax" differences are either temporary or permanent in nature.
34
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The tax character of distributions paid during the periods ended September 30,
2007 and March 31, 2007 was as follows:
- --------------------------------------------------------------------------------
EXEMPT-
PERIODS ORDINARY LONG-TERM INTEREST TOTAL
ENDED INCOME CAPITAL GAINS DIVIDENDS DISTRIBUTIONS
- -------------------------------------------------------------------------------------------------------------------
Jamestown Balanced Fund 9/30/07 $ 355,435 $ -- $ -- $ 355,435
3/31/07 $ 1,479,338 $ 2,968,013 $ -- $ 4,447,351
- -------------------------------------------------------------------------------------------------------------------
Jamestown Equity Fund 9/30/07 $ 47,723 $ -- $ -- $ 47,723
3/31/07 $ 639,252 $ 2,591,629 $ -- $ 3,230,881
- -------------------------------------------------------------------------------------------------------------------
Jamestown Select Fund 3/31/07 $ 21,728 $ -- $ -- $ 21,728
- -------------------------------------------------------------------------------------------------------------------
Jamestown Tax Exempt Virginia Fund 9/30/07 $ -- $ -- $ 509,039 $ 509,039
3/31/07 $ -- $ 36,397 $ 1,070,348 $ 1,106,745
- -------------------------------------------------------------------------------------------------------------------
Jamestown International Equity Fund 9/30/07 $ 137,859 $ -- $ -- $ 137,859
3/31/07 $ 144,928 $ -- $ -- $ 144,928
- -------------------------------------------------------------------------------------------------------------------
Security transactions -- Security transactions are accounted for on trade date.
Gains and losses on securities sold are determined on a specific identification
basis.
Securities traded on a "to-be-announced" basis -- The Jamestown Balanced Fund
occasionally trades securities on a "to-be-announced" (TBA) basis. In a TBA
transaction, the Fund has committed to purchase securities for which all
specific information is not yet known at the time of the trade, particularly the
face amount in mortgage-backed securities transactions. Securities purchased on
a TBA basis are not settled until they are delivered to the Fund, normally 15 to
45 days later. These transactions are subject to market fluctuations and their
current value is determined in the same manner as for other portfolio
securities.
Common expenses -- Common expenses of the Trust are allocated among the Funds of
the Trust based on relative net assets of each Fund or the nature of the
services performed and the relative applicability to each Fund.
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates.
Federal income tax -- It is each Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which a Fund so
qualifies and distributes at least 90% of its taxable net income, the Fund (but
not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
35
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The tax character of distributable earnings at September 30, 2007 was as
follows:
- --------------------------------------------------------------------------------
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY SELECT VIRGINIA EQUITY
FUND FUND FUND FUND FUND
- -------------------------------------------------------------------------------------------------------------
Cost of portfolio investments $ 27,741,842 $ 27,385,607 $ 22,258,613 $ 26,985,073 $ 17,277,376
============ ============ ============ ============ ============
Gross unrealized appreciation $ 8,863,575 $ 11,616,440 $ 3,038,377 $ 448,676 $ 8,551,623
Gross unrealized depreciation (150,722) (153,596) (372,639) (48,534) (431,704)
------------ ------------ ------------ ------------ ------------
Net unrealized appreciation
on investments 8,712,853 11,462,844 2,665,738 400,142 8,119,919
------------ ------------ ------------ ------------ ------------
Net unrealized appreciation on
translation of assets and
liabilities in foreign
currencies -- -- -- -- 990
Accumulated undistributed
ordinary income (loss) 399,369 235,590 (80,944) 12,370 68,282
Accumulated undistributed
long-term gains 2,277,554 1,276,270 -- 14,221 --
Capital loss carryforwards -- -- -- -- (15,436,819)
Other gains -- -- -- -- 824,709
Other temporary differences .. (22,720) (5,424) -- (12,370) --
------------ ------------ ------------ ------------ ------------
Total distributable earnings
(accumulated deficit) $ 11,367,056 $ 12,969,280 $ 2,584,794 $ 414,363 $ (6,422,919)
============ ============ ============ ============ ============
- -------------------------------------------------------------------------------------------------------------
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for the Funds is due to certain timing differences
in the recognition of capital gains or losses under income tax regulations and
accounting principles generally accepted in the United States. These "book/tax"
differences are temporary in nature and are primarily due to the tax deferral of
losses on wash sales and/or differing methods in the amortization of discounts
and premiums on fixed income securities.
As of March 31, 2007, The Jamestown International Equity Fund had the following
capital loss carryforwards for federal income tax purposes:
- --------------------------------------------------------------------------------
EXPIRES
AMOUNT MARCH 31,
- --------------------------------------------------------------------------------
Jamestown International Equity Fund $ 937,547 2010
13,878,931 2011
620,341 2012
-------------
$ 15,436,819
=============
- --------------------------------------------------------------------------------
These capital loss carryforwards may be utilized in the current and future years
to offset net realized capital gains, if any, prior to distribution to
shareholders.
For the six months ended September 30, 2007, The Jamestown Balanced Fund
reclassified $6,681 of overdistributed net investment income against accumulated
net realized loss and The Jamestown Tax Exempt Virginia Fund reclassified
$97,831 of undistributed net investment income against accumulated net realized
losses on the Statement of Assets and Liabilities due to permanent differences
in the recognition of capital gains or losses under income tax regulations and
accounting principles generally accepted in the United States. These differences
are primarily due to the tax treatment of certain debt obligations and paydown
adjustments. Such reclassifications had no effect on the Funds' net assets or
net asset value per share.
36
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
For the six months ended September 30, 2007, The Jamestown International Equity
Fund reclassified $1,951 of net realized gains from security transactions
against undistributed net investment income on the Statement of Assets and
Liabilities due to permanent differences in the recognition of capital gains and
losses under income tax regulations and accounting principles generally accepted
in the United States. These differences are primarily due to the tax treatment
of forward foreign currency exchange contracts. Such reclassification has no
effect on the Fund's net assets or net asset value per share.
2. INVESTMENT TRANSACTIONS
Investment transactions, other than short-term investments and U.S. government
securities, were as follows for the six months ended September 30, 2007:
- -------------------------------------------------------------------------------------------------------------
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY SELECT VIRGINIA EQUITY
FUND FUND FUND FUND FUND
- -------------------------------------------------------------------------------------------------------------
Purchases of investment
securities $ 4,830,043 $ 7,309,045 $ 13,840,330 $ -- $ 1,488,129
============ ============ ============ ============ ============
Proceeds from sales and
maturities of investment
securities $ 15,663,112 $ 9,991,877 $ 10,523,635 $ 1,171,600 $ 2,337,204
============ ============ ============ ============ ============
- -------------------------------------------------------------------------------------------------------------
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AND SUB-ADVISORY AGREEMENTS
Each Fund's investments are managed by Lowe, Brockenbrough & Company, Inc. (the
Adviser) under the terms of an Investment Advisory Agreement. Under the
Investment Advisory Agreement, The Jamestown Balanced Fund pays the Adviser a
fee, which is computed and accrued daily and paid monthly, at an annual rate of
..65% of its average daily net assets up to $250 million, .60% of the next $250
million of such net assets and .55% of such net assets in excess of $500
million. The Jamestown Equity Fund pays the Adviser a fee at an annual rate of
..65% of its average daily net assets up to $500 million and .55% of such net
assets in excess of $500 million. The Jamestown Select Fund pays the Adviser a
fee at an annual rate of .75% of its average daily net assets. The Jamestown Tax
Exempt Virginia Fund pays the Adviser a fee at an annual rate of .40% of its
average daily net assets up to $250 million, .35% of the next $250 million of
such net assets and .30% of such net assets in excess of $500 million. The
Jamestown International Equity Fund pays the Adviser a fee at an annual rate of
1.00% of its average daily net assets. Certain Trustees and officers of the
Trust are also officers of the Adviser.
For the six months ended September 30, 2007, the Adviser voluntarily undertook
to limit the total operating expenses of The Jamestown Select Fund, The
Jamestown Tax Exempt Virginia Fund and The Jamestown International Equity Fund
to 1.25%, .69% and 1.44%, respectively, of each Fund's average daily net assets.
Accordingly, the Adviser voluntarily waived $839, $9,453 and $38,106,
respectively, of such Funds' investment advisory fees during the six months
ended September 30, 2007.
37
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The Adviser retains Oechsle International Advisors, LLC (Oechsle) to provide The
Jamestown International Equity Fund with a continuous program of supervision of
the Fund's assets, including the composition of its portfolio, and to furnish
advice and recommendations with respect to investments, investment policies and
the purchase and sale of securities, pursuant to the terms of a Sub-Advisory
Agreement. Under the Sub-Advisory Agreement, the Adviser, not the Fund, pays
Oechsle a fee in the amount of one-half of the monthly advisory fee received by
the Adviser, net of any investment advisory fee waivers.
MUTUAL FUND SERVICES AGREEMENT
Under the terms of a Mutual Fund Services Agreement between the Trust and
Ultimus Fund Solutions, LLC (Ultimus), Ultimus provides administrative, pricing,
accounting, dividend disbursing, shareholder servicing and transfer agent
services for the Funds. For these services, Ultimus receives a monthly fee from
each of The Jamestown Balanced Fund, The Jamestown Equity Fund, The Jamestown
Select Fund and The Jamestown Tax Exempt Virginia Fund at an annual rate of .15%
of its respective average daily net assets up to $25 million; .125% of the next
$25 million of such net assets; and .10% of such net assets in excess of $50
million. Additionally, The Jamestown Select Fund is subject to a minimum monthly
fee of $4,000. From The Jamestown International Equity Fund, Ultimus receives a
monthly fee at an annual rate of .20% of its average daily net assets up to $25
million; .175% of the next $25 million of such net assets; and .15% of such net
assets in excess of $50 million. In addition, each Fund pays out-of-pocket
expenses including, but not limited to, postage, supplies and costs of pricing
the Funds' portfolio securities. Certain officers of the Trust are also officers
of Ultimus, or of Ultimus Fund Distributors, LLC (the Distributor), the
principal underwriter of each Fund's shares and an affiliate of Ultimus. The
Distributor receives no compensation from the Funds for acting as principal
underwriter.
COMPLIANCE CONSULTING AGREEMENT
Under the terms of a Compliance Consulting Agreement between the Trust and
Ultimus, Ultimus provides an individual to serve as the Trust's Chief Compliance
Officer and to administer the Trust's compliance policies and procedures. For
these services, the Funds pay Ultimus an annual base fee of $22,200 plus an
asset-based fee equal to 0.01% per annum on total net assets in excess of $100
million.
4. BROKERAGE ARRANGEMENT
In order to reduce the total operating expenses of The Jamestown Balanced Fund
and The Jamestown Equity Fund, a portion of each Fund's operating expenses have
been paid through an arrangement with a third-party broker-dealer who is
compensated through commission trades. Payment of expenses by the broker-dealer
is based on a percentage of commissions earned.
Expenses reimbursed through the brokerage arrangement totaled $10,000 and $8,000
for The Jamestown Balanced Fund and The Jamestown Equity Fund, respectively, for
the six months ended September 30, 2007.
38
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
5. FOREIGN CURRENCY TRANSLATION
With respect to The Jamestown International Equity Fund, amounts denominated in
or expected to settle in foreign currencies are translated into U.S. dollars
based on exchange rates on the following basis:
A. The market values of investment securities and other assets and
liabilities are translated at the closing rate of exchange each day.
B. Purchases and sales of investment securities and income and expenses are
translated at the rate of exchange prevailing on the respective dates of
such transactions.
C. The Fund does not isolate that portion of the results of operations caused
by changes in foreign exchange rates on investments from those caused by
changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gains or losses on
investments.
Reported net realized foreign exchange gains or losses arise from 1) purchases
and sales of foreign currencies, 2) currency gains or losses realized between
the trade and settlement dates on securities transactions and 3) the difference
between the amounts of dividends, interest and foreign withholding taxes
recorded on the Fund's books, and the U.S. dollar equivalent of the amounts
actually received or paid. Reported net unrealized foreign exchange gains and
losses arise from changes in the value of assets and liabilities, other than
investment securities, resulting from changes in exchange rates.
6. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
The Jamestown International Equity Fund enters into forward foreign currency
exchange contracts as a way of managing foreign exchange rate risk. The Fund may
enter into these contracts for the purchase or sale of a specific foreign
currency at a fixed price on a future date as a hedge or cross-hedge against
either specific transactions or portfolio positions. The objective of the Fund's
foreign currency hedging transactions is to reduce risk that the U.S. dollar
value of the Fund's securities denominated in foreign currency will decline in
value due to changes in foreign currency exchange rates. All foreign currency
exchange contracts are "marked-to-market" daily at the applicable translation
rates resulting in unrealized gains or losses. Realized and unrealized gains or
losses are included in the Fund's Statement of Assets and Liabilities and
Statement of Operations. Risks may arise upon entering into these contracts from
the potential inability of counterparties to meet the terms of their contracts
and from unanticipated movements in the value of a foreign currency relative to
the U.S. dollar.
39
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
As of September 30, 2007, The Jamestown International Equity Fund had forward
foreign currency exchange contracts outstanding as follows:
- --------------------------------------------------------------------------------
INITIAL MARKET NET UNREALIZED
SETTLEMENT DATE TO RECEIVE VALUE VALUE DEPRECIATION
- --------------------------------------------------------------------------------
Contracts To Sell
10/01/07............. 22,848 EUR $ 32,262 $ 32,494 $ (232)
---------- ---------- ----------
Total Sell Contracts... $ 32,262 $ 32,494 $ (232)
========== ========== ==========
- --------------------------------------------------------------------------------
EUR - Euro
7. CONTINGENCIES AND COMMITMENTS
The Funds indemnify the Trust's officers and trustees for certain liabilities
that might arise from their performance of their duties to the Funds.
Additionally, in the normal course of business the Funds enter into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Funds' maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Funds that have not yet occurred. However, based on experience, the Funds expect
the risk of loss to be remote.
8. ACCOUNTING PRONOUNCEMENTS
On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB
Interpretation No. 48 (FIN 48) "Accounting for Uncertainty in Income Taxes." FIN
48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken in the course of preparing the Funds' tax
returns to determine whether the tax positions are "more-likely-than-not" of
being sustained by the applicable tax authority. Tax positions not deemed to
meet the more-likely-than-not threshold would be recorded as a tax benefit or
expense in the current year. Adoption of FIN 48 is required for fiscal years
beginning after December 15, 2006 and is to be applied to all open tax years as
of the effective date. As a result, the Funds have adopted FIN 48 with this
Semi-Annual report. Based on its analysis, management does not believe that the
adoption of FIN 48 has a material impact on the financial statements.
In September 2006, the Financial Accounting Standards Board issued Statement on
Financial Accounting Standards (SFAS) No. 157, "Fair Value Measurements." This
standard establishes a single authoritative definition of fair value, sets out a
framework for measuring fair value and requires additional disclosures about
fair value measurements. SFAS No. 157 applies to fair value measurements already
required or permitted by existing standards. SFAS No. 157 is effective for
financial statements issued for fiscal years beginning after November 15, 2007
and interim periods within those fiscal years. The changes to current generally
accepted accounting principles from the application of SFAS No. 157 relate to
the definition of fair value, the methods used to measure fair value, and the
expanded disclosures about fair value measurements. As of September 30, 2007,
the Funds do not believe the adoption of SFAS No. 157 will impact the amounts
reported in the financial statements. However, additional disclosures may be
required about the inputs used to develop the measurements and the effect of
certain of the measurements reported on the statement of changes in net assets
for a fiscal period.
40
THE JAMESTOWN FUNDS
ABOUT YOUR FUNDS' EXPENSES (UNAUDITED)
================================================================================
We believe it is important for you to understand the impact of costs on your
investment. As a shareholder of the Funds, you may incur two types of costs: (1)
transaction costs, including redemption fees; and (2) ongoing costs, including
management fees and other Fund expenses. The following examples are intended to
help you understand your ongoing costs (in dollars) of investing in the Funds
and to compare these costs with the ongoing costs of investing in other mutual
funds.
A mutual fund's ongoing costs are expressed as a percentage of its average net
assets. This figure is known as the expense ratio. The expenses in the table
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 Fund'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
Fund'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
Funds. 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 Funds under the heading "Expenses Paid During Period."
HYPOTHETICAL 5% RETURN - This section is intended to help you compare the Funds'
costs with those of other mutual funds. It assumes that each Fund had an annual
return of 5% before expenses during the period shown, but that the expense ratio
is unchanged. In this case, because the returns used are not the Funds' 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
Fund'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 Funds do not charge sales loads. However, a
redemption fee of 2% is applied on the sale of shares of The Jamestown
International Equity Fund held for less than 90 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.
More information about the Funds' expenses, including annual expense ratios for
the prior five fiscal years, can be found in this report. For additional
information on operating expenses and other shareholder costs, please refer to
the Funds' prospectus.
41
THE JAMESTOWN FUNDS
ABOUT YOUR FUNDS' EXPENSES (UNAUDITED) (CONTINUED)
================================================================================
Beginning Ending
Account Value Account Value Expenses
April 1, September 30, Paid During
2007 2007 Period *
- --------------------------------------------------------------------------------
THE JAMESTOWN BALANCED FUND
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,087.60 $4.81
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,020.46 $4.66
- --------------------------------------------------------------------------------
THE JAMESTOWN EQUITY FUND
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,120.60 $4.89
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,020.46 $4.66
- --------------------------------------------------------------------------------
THE JAMESTOWN SELECT FUND
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,083.80 $6.53
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,018.80 $6.33
- --------------------------------------------------------------------------------
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,017.00 $3.49
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,021.61 $3.50
- --------------------------------------------------------------------------------
THE JAMESTOWN INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,050.50 $7.40
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,017.85 $7.28
- --------------------------------------------------------------------------------
* Expenses are equal to the Funds' annualized expense ratios for the period
as stated below, multiplied by the average account value over the period,
multiplied by 183/365 (to reflect the one-half year period).
The Jamestown Balanced Fund 0.92%
The Jamestown Equity Fund 0.92%
The Jamestown Select Fund 1.25%
The Jamestown Tax Exempt Virginia Fund 0.69%
The Jamestown International Equity Fund 1.44%
42
THE JAMESTOWN FUNDS
OTHER INFORMATION (UNAUDITED)
================================================================================
A description of the policies and procedures that the Funds use to vote proxies
relating to portfolio securities is available without charge upon request by
calling toll-free 1-866-738-1126, or on the Securities and Exchange Commission's
(SEC) website at http://www.sec.gov. Information regarding how the Funds 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
1-866-738-1126, or on the SEC's website at http://www.sec.gov.
The Trust files a complete listing of portfolio holdings of the Funds with the
SEC as of the first and third quarters of each fiscal year on Form N-Q. The
filings are available upon request, by calling 1-866-738-1126. Furthermore, you
may obtain a copy of these filings on the SEC's website at http://www.sec.gov.
The Trust's Forms N-Q may also be reviewed and copied at the SEC's Public
Reference Room in Washington, DC, and information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330.
43
================================================================================
THE JAMESTOWN FUNDS
INVESTMENT ADVISER
Lowe, Brockenbrough & Company, Inc.
1802 Bayberry Court
Suite 400
Richmond, Virginia 23226
www.jamestownfunds.com
ADMINISTRATOR
Ultimus Fund Solutions, LLC
P.O. Box 46707
Cincinnati, Ohio 45246-0707
(Toll-Free) 1-866-738-1126
INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
Ernst & Young LLP
1900 Scripps Center
312 Walnut Street
Cincinnati, Ohio 45202
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
BOARD OF TRUSTEES
Austin Brockenbrough, III
John T. Bruce
Charles M. Caravati, Jr.
Robert S. Harris
J. Finley Lee, Jr.
Richard L. Morrill
Harris V. Morrissette
Erwin H. Will, Jr.
Samuel B. Witt, III
================================================================================
================================================================================
THE
GOVERNMENT STREET
FUNDS
NO-LOAD MUTUAL FUNDS
SEMI-ANNUAL REPORT
SEPTEMBER 30, 2007
(UNAUDITED)
================================================================================
T. LEAVELL & ASSOCIATES, INC.
INVESTMENT ADVISER
FOUNDED 1979
================================================================================
THE GOVERNMENT STREET EQUITY FUND
THE GOVERNMENT STREET MID-CAP FUND
THE GOVERNMENT STREET BOND FUND
THE ALABAMA TAX FREE BOND FUND
================================================================================
THE GOVERNMENT STREET EQUITY FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
INDUSTRY CONCENTRATION VS. THE S&P 500 INDEX
[BAR CHART OMITTED]
(% of Net Assets)
The
Government Street S&P 500
Equity Fund Index
------------------ ---------
Consumer Discretionary 7.3% 9.2%
Consumer Staples 8.3% 9.5%
Energy 13.1% 11.7%
Financials 18.4% 19.8%
Health Care 10.5% 11.6%
Industrials 15.3% 11.5%
Information Technology 11.9% 16.2%
Materials 2.6% 3.2%
Telecommunication Services 0.3% 3.8%
Utilities 1.8% 3.5%
Exchange-Traded Funds 9.2% 0.0%
Cash Equivalents 1.3% 0.0%
TOP TEN HOLDINGS
SECURITY DESCRIPTION % OF NET ASSETS
- ----------------------------------------------------------------------
iShares MSCI EAFE Index Fund 5.1%
Bank of America Corporation 3.8%
Altria Group, Inc. 2.8%
WellPoint, Inc. 2.7%
U.S. Bancorp 2.6%
Procter & Gamble Company (The) 2.5%
American Express Company 2.4%
Apache Corporation 2.4%
Exxon Mobil Corporation 2.3%
Cisco Systems, Inc. 2.3%
3
THE GOVERNMENT STREET MID-CAP FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
INDUSTRY CONCENTRATION VS. THE S&P MIDCAP 400 INDEX
[BAR CHART OMITTED]
(% of Net Assets)
The
Government Street S&P MidCap
Mid-Cap Fund 400 Index
------------------ ------------
Consumer Discretionary 12.3% 13.2%
Consumer Staples 2.0% 2.9%
Energy 7.4% 9.7%
Financials 14.1% 15.2%
Health Care 12.0% 11.9%
Industrials 15.8% 16.0%
Information Technology 17.2% 15.7%
Materials 5.9% 7.2%
Telecommunication Services 0.2% 0.9%
Utilities 6.9% 7.3%
Cash Equivalents 6.2% 0.0%
TOP TEN HOLDINGS
SECURITY DESCRIPTION % OF NET ASSETS
- ---------------------------------------------------------------------
Covance, Inc. 1.5%
Stericycle, Inc. 1.5%
Coventry Health Care, Inc. 1.5%
Gilead Sciences, Inc. 1.4%
SPX Corporation 1.3%
FMC Technologies, Inc. 1.3%
Jacobs Engineering Group, Inc. 1.3%
SanDisk Corporation 1.2%
Eaton Vance Corporation 1.2%
Martin Marietta Materials, Inc. 1.1%
4
THE GOVERNMENT STREET BOND FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
ASSET ALLOCATION VS. THE LEHMAN INTERMEDIATE U.S. GOVERNMENT/CREDIT BOND INDEX
[BAR CHART OMITTED]
The Lehman Intermediate
Government Street U.S Government/Credit
Bond Fund Bond Index
------------------ ----------------------
U.S. Treasury Obligations 0.4% 41.0%
U.S. Agency Obligations 26.4% 21.0%
Coporate Bonds 29.1% 38.0%
Mortgage-Backed Securities 23.3% 0.0%
Cash Equivalents 20.8% 0.0%
DISTRIBUTION BY MATURITY
--------------------------------------
MATURITY % HOLDINGS
-------- ----------
Under 1 year 32.5%
1-3 Years 15.5%
3-5 Years 24.9%
5-7 Years 3.9%
7-10 Years 6.1%
Over 10 Years 17.1%
DISTRIBUTION BY RATING
--------------------------------------
RATING % HOLDINGS
------ ----------
AAA 70.7%
AA- 3.6%
A+ 5.5%
A 13.3%
BBB+ 3.3%
CCC+ 3.6%
5
THE ALABAMA TAX FREE BOND FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% OF HOLDINGS)
[PIE CHART OMITTED]
Revenue Bonds 34.8%
General Oligation Bonds 54.1%
Pre-Refunded & Escrowed Bonds 7.4%
Cash Equivalents 3.7%
DISTRIBUTION BY RATING
--------------------------------------
RATING % HOLDINGS
------ ----------
AAA 67.1%
AA 32.9%
6
THE GOVERNMENT STREET FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2007 (UNAUDITED)
====================================================================================================
GOVERNMENT GOVERNMENT GOVERNMENT ALABAMA
STREET STREET STREET TAX FREE
EQUITY MID-CAP BOND BOND
FUND FUND FUND FUND
------------- ------------ ------------ ------------
ASSETS
Investments in securities:
At acquisition cost ..................... $ 40,854,232 $ 24,982,426 $ 27,674,425 $ 24,454,623
============ ============ ============ ============
At value (Note 1) ....................... $ 83,365,897 $ 35,314,901 $ 27,227,717 $ 24,791,937
Dividends and interest receivable ......... 92,884 19,092 219,462 282,894
Receivable for capital shares sold ........ 150 100 7,655 --
Other assets .............................. 12,002 9,899 8,807 7,198
------------- ------------ ------------ ------------
TOTAL ASSETS ............................ 83,470,933 35,343,992 27,463,641 25,082,029
------------- ------------ ------------ ------------
LIABILITIES
Distributions payable ..................... 6,350 -- 6,461 24,287
Payable for capital shares redeemed ....... 14,327 -- 55,764 4,165
Accrued investment advisory fees (Note 3) . 41,351 21,336 6,923 2,782
Payable to Administrator (Note 3) ......... 9,150 4,650 2,350 3,600
Other accrued expenses .................... 14,231 5,173 4,200 4,000
------------- ------------ ------------ ------------
TOTAL LIABILITIES ....................... 85,409 31,159 75,698 38,834
------------- ------------ ------------ ------------
NET ASSETS ................................ $ 83,385,524 $ 35,312,833 $ 27,387,943 $ 25,043,195
============ ============ ============ ============
Net assets consist of:
Paid-in capital ........................... $ 39,350,543 $ 24,684,536 $ 30,780,865 $ 24,749,803
Accumulated undistributed (overdistributed)
net investment income ................... 5,430 108,339 (70,318) 13,882
Accumulated net realized gains (losses)
from security transactions .............. 1,517,886 187,483 (2,875,896) (57,804)
Net unrealized appreciation (depreciation)
on investments .......................... 42,511,665 10,332,475 (446,708) 337,314
------------- ------------ ------------ ------------
Net assets ................................ $ 83,385,524 $ 35,312,833 $ 27,387,943 $ 25,043,195
============ ============ ============ ============
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) ........................... 1,597,543 2,521,615 1,388,065 2,409,477
============ ============ ============ ============
Net asset value, offering price and
redemption price per share (Note 1) ..... $ 52.20 $ 14.00 $ 19.73 $ 10.39
============ ============ ============ ============
See accompanying notes to financial statements.
7
THE GOVERNMENT STREET FUNDS
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2007 (UNAUDITED)
===================================================================================================
GOVERNMENT GOVERNMENT GOVERNMENT ALABAMA
STREET STREET STREET TAX FREE
EQUITY MID-CAP BOND BOND
FUND FUND FUND FUND
------------ ------------ ------------ ------------
INVESTMENT INCOME
Interest ............................. $ 14,449 $ 65,139 $ 751,875 $ 512,343
Dividends ............................ 785,387 181,252 67 13,229
Foreign withholding taxes on dividents (4,727) (1,455) -- --
------------ ------------ ------------ ------------
TOTAL INVESTMENT INCOME ............ 795,109 244,936 751,942 525,572
------------ ------------ ------------ ------------
EXPENSES
Investment advisory fees (Note 3) .... 260,715 131,856 73,520 44,699
Administration fees (Note 3) ........ 52,832 25,124 11,082 19,092
Professional fees .................... 8,371 7,146 7,734 6,462
Trustees' fees and expenses .......... 6,287 6,287 6,287 6,287
Custodian fees ....................... 7,484 7,266 5,949 2,517
Compliance fees (Note 3) ............ 4,468 3,317 3,200 3,113
Pricing costs ........................ 1,265 2,087 3,514 5,861
Postage and supplies ................. 4,295 2,551 2,738 2,455
Printing of shareholder reports ...... 3,897 1,846 1,851 1,656
Registration fees .................... 2,915 1,547 1,320 1,353
Insurance expense .................... 2,821 1,256 1,148 1,052
Other expenses ....................... 10,794 5,478 3,041 2,292
------------ ------------ ------------ ------------
TOTAL EXPENSES ..................... 366,144 195,761 121,384 96,839
Fees waived by the Adviser (Note 3) .. -- (2,372) (16,985) (13,827)
------------ ------------ ------------ ------------
NET EXPENSES ....................... 366,144 193,389 104,399 83,012
------------ ------------ ------------ ------------
NET INVESTMENT INCOME .................. 428,965 51,547 647,543 442,560
------------ ------------ ------------ ------------
REALIZED AND UNREALIZED GAINS
(LOSSES) ON INVESTMENTS
Net realized gains from
security transactions .............. 1,517,753 187,225 12,982 10,301
Net realized gains from in-kind
redemptions (Note 1) ............... 5,656,635 140,412 -- --
Net change in unrealized appreciation/
depreciation on investments ........ (517,840) 1,863,677 (132,455) 2,744
------------ ------------ ------------ ------------
NET REALIZED AND UNREALIZED
GAINS (LOSSES) ON INVESTMENTS ........ 6,656,548 2,191,314 (119,473) 13,045
------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS ...................... $ 7,085,513 $ 2,242,861 $ 528,070 $ 455,605
============ ============ ============ ============
See accompanying notes to financial statements.
8
THE GOVERNMENT STREET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=========================================================================================================
GOVERNMENT STREET GOVERNMENT STREET
EQUITY FUND MID-CAP FUND
-------------------------------------------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
SEPT. 30, ENDED SEPT. 30, ENDED
2007 MARCH 31, 2007 MARCH 31,
(UNAUDITED) 2007 (UNAUDITED) 2007
------------- ------------- ------------- -------------
FROM OPERATIONS
Net investment income .................. $ 428,965 $ 875,665 $ 51,547 $ 88,137
Net realized gains from
security transactions ............... 1,517,753 8,725,441 187,225 1,827,568
Net realized gains from in-kind
redemptions (Note 1) ................. 5,656,635 -- 140,412 --
Net change in unrealized appreciation/
depreciation on investments .......... (517,840) (3,740,630) 1,863,677 (804,624)
------------- ------------- ------------- -------------
Net increase in net assets from operations 7,085,513 5,860,476 2,242,861 1,111,081
------------- ------------- ------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ............. (430,950) (871,818) -- (123,370)
From realized capital gains
on security transactions ............. -- (13,025,536) -- (2,640,776)
------------- ------------- ------------- -------------
Net decrease in net assets from
distributions to shareholders .......... (430,950) (13,897,354) -- (2,764,146)
------------- ------------- ------------- -------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold .............. 779,515 4,965,258 904,498 2,730,131
Net asset value of shares issued in
reinvestment of distributions
to shareholders ...................... 418,078 13,483,748 -- 2,748,844
Payments for shares redeemed ........... (12,223,133) (29,898,475) (1,795,379) (7,483,807)
------------- ------------- ------------- -------------
Net decrease in net assets from
capital share transactions ............. (11,025,540) (11,449,469) (890,881) (2,004,832)
------------- ------------- ------------- -------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS .......................... (4,370,977) (19,486,347) 1,351,980 (3,657,897)
NET ASSETS
Beginning of period .................... 87,756,501 107,242,848 33,960,853 37,618,750
------------- ------------- ------------- -------------
End of period .......................... $ 83,385,524 $ 87,756,501 $ 35,312,833 $ 33,960,853
============= ============= ============= =============
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME .................. $ 5,430 $ 7,415 $ 108,339 $ 56,792
============= ============= ============= =============
Capital share activity
Sold ................................... 15,421 101,372 66,028 209,562
Reinvested ............................. 8,153 275,696 -- 209,747
Redeemed ............................... (240,460) (608,524) (130,182) (577,999)
------------- ------------- ------------- -------------
Net decrease in shares outstanding ..... (216,886) (231,456) (64,154) (158,690)
Shares outstanding, beginning of period 1,814,429 2,045,885 2,585,769 2,744,459
------------- ------------- ------------- -------------
Shares outstanding, end of period ...... 1,597,543 1,814,429 2,521,615 2,585,769
============= ============= ============= =============
See accompanying notes to financial statements.
9
THE GOVERNMENT STREET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=========================================================================================================
GOVERNMENT STREET ALABAMA TAX FREE
BOND FUND BOND FUND
-------------------------------------------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
SEPT. 30, ENDED SEPT. 30, ENDED
2007 MARCH 31, 2007 MARCH 31,
(UNAUDITED) 2007 (UNAUDITED) 2007
------------- ------------- ------------- -------------
FROM OPERATIONS
Net investment income ................. $ 647,543 $ 1,392,391 $ 442,560 $ 879,135
Net realized gains (losses) from
security transactions ............... 12,982 (398,481) 10,301 20,874
Net change in unrealized appreciation/
depreciation on investments ......... (132,455) 672,643 2,744 (44,862)
------------- ------------- ------------- -------------
Net increase in net assets
from operations ....................... 528,070 1,666,553 455,605 855,147
------------- ------------- ------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
From and/or in excess of net
investment income ................... (666,674) (1,429,567) (440,770) (876,155)
------------- ------------- ------------- -------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ............. 947,315 2,278,502 635,375 2,206,930
Net asset value of shares issued in
reinvestment of distributions
to shareholders ..................... 628,402 1,339,337 283,658 569,451
Payments for shares redeemed .......... (3,790,294) (10,348,383) (1,859,106) (2,968,731)
------------- ------------- ------------- -------------
Net decrease in net assets from
capital share transactions ............ (2,214,577) (6,730,544) (940,073) (192,350)
------------- ------------- ------------- -------------
TOTAL DECREASE IN NET ASSETS ............ (2,353,181) (6,493,558) (925,238) (213,358)
NET ASSETS
Beginning of period ................... 29,741,124 36,234,682 25,968,433 26,181,791
------------- ------------- ------------- -------------
End of period ......................... $ 27,387,943 $ 29,741,124 $ 25,043,195 $ 25,968,433
============= ============= ============= =============
ACCUMULATED UNDISTRIBUTED
(OVERDISTRIBUTED) NET
INVESTMENT INCOME ..................... $ (70,318) $ (71,879) $ 13,882 $ 12,778
============= ============= ============= =============
Capital share activity
Sold .................................. 47,992 115,201 61,479 212,370
Reinvested ............................ 31,904 67,923 27,401 54,790
Redeemed .............................. (192,177) (525,317) (179,546) (285,665)
------------- ------------- ------------- -------------
Net decrease in shares outstanding .... (112,281) (342,193) (90,666) (18,505)
Shares outstanding, beginning of period 1,500,346 1,842,539 2,500,143 2,518,648
------------- ------------- ------------- -------------
Shares outstanding, end of period ..... 1,388,065 1,500,346 2,409,477 2,500,143
============= ============= ============= =============
See accompanying notes to financial statements.
10
THE GOVERNMENT STREET EQUITY FUND
FINANCIAL HIGHLIGHTS
==================================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- ----------------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 ----------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
----------- ----------- ----------- ----------- ----------- -----------
Net asset value at beginning of period . $ 48.37 $ 52.42 $ 47.11 $ 46.10 $ 34.13 $ 45.55
----------- ----------- ----------- ----------- ----------- -----------
Income (loss) from investment operations:
Net investment income ................ 0.26 0.48 0.50 0.50 0.32 0.28
Net realized and unrealized
gains (losses) on investments ...... 3.83 2.90 5.31 1.01 11.97 (11.42)
----------- ----------- ----------- ----------- ----------- -----------
Total from investment operations ....... 4.09 3.38 5.81 1.51 12.29 (11.14)
----------- ----------- ----------- ----------- ----------- -----------
Less distributions:
Dividends from net investment income . (0.26) (0.48) (0.50) (0.50) (0.32) (0.28)
Distributions from net realized gains -- (6.95) -- -- -- --
----------- ----------- ----------- ----------- ----------- -----------
Total distributions .................... (0.26) (7.43) (0.50) (0.50) (0.32) (0.28)
----------- ----------- ----------- ----------- ----------- -----------
Net asset value at end of period ....... $ 52.20 $ 48.37 $ 52.42 $ 47.11 $ 46.10 $ 34.13
=========== =========== =========== =========== =========== ===========
Total return (a) ....................... 8.47%(b) 7.04% 12.39% 3.27% 36.09% (24.47%)
=========== =========== =========== =========== =========== ===========
Net assets at end of period (000's) .... $ 83,386 $ 87,757 $ 107,243 $ 132,922 $ 129,719 $ 87,837
=========== =========== =========== =========== =========== ===========
Ratio of expenses to average net assets 0.84%(c) 0.84% 0.78% 0.76% 0.79% 0.81%
Ratio of net investment income
to average net assets ................ 0.99%(c) 0.96% 0.95% 1.08% 0.77% 0.76%
Portfolio turnover rate ................ 4%(b) 15% 17% 13% 15% 12%
(a) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns shown do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(b) Not annualized.
(c) Annualized.
See accompanying notes to financial statements.
11
THE GOVERNMENT STREET MID-CAP FUND
FINANCIAL HIGHLIGHTS
=========================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- -------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED PERIOD
SEPT. 30, YEARS ENDED MARCH 31, ENDED
2007 -------------------------------------------- MARCH 31,
(UNAUDITED) 2007 2006 2005 2004 (a)
------------ ------------ ------------ ------------ ------------
Net asset value at beginning of period $ 13.13 $ 13.71 $ 11.30 $ 10.33 $ 10.00
------------ ------------ ------------ ------------ ------------
Income from investment operations:
Net investment income ............... 0.02 0.04 0.05 0.01 0.01
Net realized and unrealized
gains on investments .............. 0.85 0.45 2.38 0.97 0.68
------------ ------------ ------------ ------------ ------------
Total from investment operations ...... 0.87 0.49 2.43 0.98 0.69
------------ ------------ ------------ ------------ ------------
Less distributions:
Dividends from net investment income -- (0.05) (0.02) (0.01) (0.01)
Distributions from net realized gains -- (1.02) -- (0.00)(b) (0.35)
------------ ------------ ------------ ------------ ------------
Total distributions ................... -- (1.07) (0.02) (0.01) (0.36)
------------ ------------ ------------ ------------ ------------
Net asset value at end of period ...... $ 14.00 $ 13.13 $ 13.71 $ 11.30 $ 10.33
============ ============ ============ ============ ============
Total return (c) ...................... 6.63%(d) 3.83% 21.51% 9.47% 6.83%(d)
============ ============ ============ ============ ============
Net assets at end of period (000's) ... $ 35,313 $ 33,961 $ 37,619 $ 32,025 $ 19,227
============ ============ ============ ============ ============
Ratio of net expenses to
average net assets (e) .............. 1.10%(f) 1.10% 1.10% 1.10% 1.09%(f)
Ratio of net investment income
to average net assets ............... 0.29%(f) 0.26% 0.37% 0.14% 0.11%(f)
Portfolio turnover rate ............... 3%(d) 11% 28% 6% 177%(f)
(a) Represents the period from the commencement of operations (November 17,
2003) through March 31, 2004.
(b) Amount rounds to less than $0.01 per share.
(c) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns shown do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(d) Not annualized.
(e) Absent investment advisory fees voluntarily waived by the Adviser, the
ratio of expenses to average net assets would have been 1.11%(f) for the
six months ended September 30, 2007 and 1.12%, 1.11%, 1.23% and 1.71%(f)
for the periods ended March 31, 2007, 2006, 2005 and 2004, respectively
(Note 3).
(f) Annualized.
See accompanying notes to financial statements.
12
THE GOVERNMENT STREET BOND FUND
FINANCIAL HIGHLIGHTS
===================================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- -----------------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 -------------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
----------- ----------- ----------- ----------- ----------- -----------
Net asset value at beginning of period $ 19.82 $ 19.67 $ 20.29 $ 21.24 $ 21.55 $ 20.75
----------- ----------- ----------- ----------- ----------- -----------
Income (loss) from investment operations:
Net investment income ............... 0.43 0.81 0.77(a) 0.71 0.81 0.99
Net realized and unrealized
gains (losses) on investments ..... (0.07) 0.26 (0.41) (0.71) (0.11) 0.92
----------- ----------- ----------- ----------- ----------- -----------
Total from investment operations ...... 0.36 1.07 0.36 0.00 0.70 1.91
----------- ----------- ----------- ----------- ----------- -----------
Dividends from and/or in excess of
net investment income ............... (0.45) (0.92) (0.98) (0.95) (1.01) (1.11)
----------- ----------- ----------- ----------- ----------- -----------
Net asset value at end of period ...... $ 19.73 $ 19.82 $ 19.67 $ 20.29 $ 21.24 $ 21.55
=========== =========== =========== =========== =========== ===========
Total return (b) ...................... 1.86%(c) 5.56% 1.80% 0.04% 3.34% 9.36%
=========== =========== =========== =========== =========== ===========
Net assets at end of period (000's) ... $ 27,388 $ 29,741 $ 36,235 $ 59,919 $ 64,005 $ 58,665
=========== =========== =========== =========== =========== ===========
Ratio of net expenses
to average net assets (d) ........... 0.71%(e) 0.71% 0.71% 0.71% 0.70% 0.71%
Ratio of net investment income
to average net assets ............... 4.41%(e) 4.50% 3.75% 3.44% 3.65% 4.62%
Portfolio turnover rate ............... 11%(c) 26% 32% 28% 33% 39%
(a) Calculated using weighted average shares outstanding during the period.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns shown do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(c) Not annualized.
(d) Absent investment advisory fees voluntarily waived by the Adviser, the
ratio of expenses to average net assets would have been 0.83%(e) for the
six months ended September 30, 2007 and 0.82% and 0.74% for the years
ended March 31, 2007 and 2006, respectively (Note 3).
(e) Annualized.
See accompanying notes to financial statements.
13
THE ALABAMA TAX FREE BOND FUND
FINANCIAL HIGHLIGHTS
===================================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- -----------------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPT. 30, YEARS ENDED MARCH 31,
2007 -----------------------------------------------------------------------
(UNAUDITED) 2007 2006 2005 2004 2003
----------- ----------- ----------- ----------- ----------- -----------
Net asset value at beginning of period . $ 10.39 $ 10.40 $ 10.55 $ 10.90 $ 10.89 $ 10.40
----------- ----------- ----------- ----------- ----------- -----------
Income (loss) from investment operations:
Net investment income ................ 0.18 0.36 0.34 0.35 0.35 0.40
Net realized and unrealized
gains (losses) on investments ...... (0.00)(a) (0.01) (0.15) (0.36) 0.01 0.49
----------- ----------- ----------- ----------- ----------- -----------
Total from investment operations ....... 0.18 0.35 0.19 (0.01) 0.36 0.89
----------- ----------- ----------- ----------- ----------- -----------
Dividends from net investment income ... (0.18) (0.36) (0.34) (0.34) (0.35) (0.40)
----------- ----------- ----------- ----------- ----------- -----------
Net asset value at end of period ....... $ 10.39 $ 10.39 $ 10.40 $ 10.55 $ 10.90 $ 10.89
=========== =========== =========== =========== =========== ===========
Total return (b) ....................... 1.74%(c) 3.38% 1.80% (0.06%) 3.40% 8.67%
=========== =========== =========== =========== =========== ===========
Net assets at end of period (000's) .... $ 25,043 $ 25,968 $ 26,182 $ 34,525 $ 38,702 $ 34,729
=========== =========== =========== =========== =========== ===========
Ratio of net expenses to
average net assets (d) ............... 0.65%(e) 0.65% 0.65% 0.65% 0.65% 0.65%
Ratio of net investment income
to average net assets ................ 3.47%(e) 3.44% 3.25% 3.21% 3.26% 3.74%
Portfolio turnover rate ................ 2%(c) 15% 5% 4% 10% 9%
(a) Amount rounds to less than $0.01 per share.
(b) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns shown do not
reflect the deduction of taxes a shareholder would pay on Fund
distributions or the redemption of Fund shares.
(c) Not annualized.
(d) Absent investment advisory fees voluntarily waived by the Adviser, the
ratios of expenses to average net assets would have been 0.76%(e) for the
six months ended September 30, 2007 and 0.76%, 0.73%, 0.69%, 0.68%, and
0.69% for the years ended March 31, 2007, 2006, 2005, 2004, and 2003,
respectively (Note 3).
(e) Annualized.
See accompanying notes to financial statements.
14
THE GOVERNMENT STREET EQUITY FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
=======================================================================================
SHARES COMMON STOCKS -- 89.5% VALUE
- ---------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 7.3%
3,839 Citadel Broadcasting Corporation............................. $ 15,970
10,000 Harrah's Entertainment, Inc.................................. 869,300
39,500 Home Depot, Inc.............................................. 1,281,380
5,500 J.C. Penney Company, Inc..................................... 348,535
10,000 Johnson Controls, Inc........................................ 1,181,100
11,000 NIKE, Inc. - Class B......................................... 645,260
50,000 Walt Disney Company (The).................................... 1,719,500
-----------
6,061,045
-----------
CONSUMER STAPLES -- 8.2%
33,000 Altria Group, Inc. .......................................... 2,294,490
22,836 Kraft Foods, Inc............................................. 788,071
10,000 PepsiCo, Inc................................................. 732,600
30,000 Procter & Gamble Company (The)............................... 2,110,200
20,100 Walgreen Company............................................. 949,524
-----------
6,874,885
-----------
ENERGY -- 13.1%
21,814 Apache Corporation........................................... 1,964,569
7,300 BP plc - ADR................................................. 506,255
20,100 Chevron Corporation ......................................... 1,880,958
19,500 ConocoPhillips............................................... 1,711,515
1,000 EnergySouth, Inc............................................. 50,420
20,800 Exxon Mobil Corporation...................................... 1,925,248
22,990 Spectra Energy Corporation................................... 562,795
10,000 Transocean, Inc. (a)......................................... 1,130,500
10,000 Valero Energy Corporation.................................... 671,800
8,000 XTO Energy, Inc.............................................. 494,720
-----------
10,898,780
-----------
FINANCIALS -- 18.4%
27,080 Aegon N.V. - ARS............................................. 515,332
21,800 AFLAC, Inc................................................... 1,243,472
2,000 American Capital Strategies Ltd.............................. 85,460
33,600 American Express Company..................................... 1,994,832
4,000 American International Group, Inc............................ 270,600
62,870 Bank of America Corporation.................................. 3,160,475
5,000 Broadridge Financial Solutions, Inc. ....................... 94,750
15,000 Charles Schwab Corporation................................... 324,000
35,000 Citigroup, Inc............................................... 1,633,450
27,200 Colonial Properties Trust.................................... 932,960
7,000 Goldman Sachs Group, Inc. (The).............................. 1,517,180
6,000 JPMorgan Chase & Company..................................... 274,920
20,000 Progressive Corporation...................................... 388,200
15,000 Rayonier, Inc. .............................................. 720,600
67,400 U.S. Bancorp................................................. 2,192,522
-----------
15,348,753
-----------
15
THE GOVERNMENT STREET EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
SHARES COMMON STOCKS -- 89.5% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
HEALTH CARE -- 10.5%
14,300 Becton, Dickinson & Company.................................. $ 1,173,315
17,500 Cardinal Health, Inc......................................... 1,094,275
20,000 Elan Corporation (a)......................................... 420,800
5,000 Fresenius Medical Care AG & Company - ADR.................... 265,300
21,000 Johnson & Johnson............................................ 1,379,700
11,250 Techne Corporation (a)....................................... 709,650
31,300 UnitedHealth Group, Inc. .................................... 1,515,859
28,000 WellPoint, Inc. (a).......................................... 2,209,760
-----------
8,768,659
-----------
INDUSTRIALS -- 15.3%
23,500 Caterpillar, Inc............................................. 1,843,105
3,000 C.H. Robinson Worldwide, Inc. ............................... 162,870
30,000 Emerson Electric Company..................................... 1,596,600
14,000 FedEx Corporation............................................ 1,466,500
20,000 General Dynamics Corporation................................. 1,689,400
28,000 General Electric Company..................................... 1,159,200
16,000 Ingersoll-Rand Company Ltd. - Class A........................ 871,520
10,000 Norfolk Southern Corporation................................. 519,100
31,000 Quanta Services, Inc. (a).................................... 819,950
5,000 Stericycle, Inc. (a)......................................... 285,800
16,000 United Technologies Corporation.............................. 1,287,680
16,000 Waters Corporation (a)....................................... 1,070,720
-----------
12,772,445
-----------
INFORMATION TECHNOLOGY -- 11.9%
42,500 Adobe Systems, Inc. (a)...................................... 1,855,550
5,000 Applied Materials, Inc....................................... 103,500
20,000 Automatic Data Processing, Inc. ............................. 918,600
4,000 Cerner Corporation (a)....................................... 239,240
57,000 Cisco Systems, Inc. (a)...................................... 1,887,270
31,000 Corning, Inc. ............................................... 764,150
37,000 Hewlett-Packard Company...................................... 1,842,230
7,000 International Business Machines Corporation.................. 824,600
18,000 Network Appliance, Inc. (a).................................. 484,380
27,000 Texas Instruments, Inc. ..................................... 987,930
-----------
9,907,450
-----------
MATERIALS -- 2.5%
7,000 Alcoa, Inc................................................... 273,840
10,000 Nucor Corporation............................................ 594,700
7,000 POSCO - ADR.................................................. 1,251,390
-----------
2,119,930
-----------
TELECOMMUNICATIONS SERVICES -- 0.5%
6,000 AT&T, Inc.................................................... 253,860
15,000 Qwest Communications International, Inc. (a)................. 137,400
-----------
391,260
-----------
16
THE GOVERNMENT STREET EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
SHARES COMMON STOCKS -- 89.5% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
UTILITIES -- 1.8%
65,980 Duke Energy Corporation...................................... $ 1,233,166
5,000 Wisconsin Energy Corporation................................. 225,150
-----------
1,458,316
-----------
TOTAL COMMON STOCKS (Cost $33,196,913)....................... $74,601,523
-----------
=======================================================================================
SHARES EXCHANGE-TRADED FUNDS -- 9.2% VALUE
- ---------------------------------------------------------------------------------------
51,500 iShares MSCI EAFE Index Fund................................. $ 4,255,445
2,000 Vanguard Emerging Markets ETF................................ 207,120
20,000 Vanguard FTSE All-World Ex-US Index ETF (a).................. 1,193,800
16,000 Vanguard Information Technology Index ETF.................... 970,400
4,500 Vanguard Materials ETF....................................... 396,135
8,000 Vanguard Telecommunication Services ETF...................... 664,560
-----------
TOTAL EXCHANGE-TRADED FUNDS (Cost $6,580,405)................ $7,687,460
-----------
=======================================================================================
PAR VALUE COMMERCIAL PAPER -- 1.3% VALUE
- ---------------------------------------------------------------------------------------
$1,076,000 Deutsche Bank AG, discount, due 10/01/2007 (Cost $1,076,000) $ 1,076,000
-----------
=======================================================================================
SHARES MONEY MARKET FUNDS -- 0.0% VALUE
- ---------------------------------------------------------------------------------------
914 AIM STIT - STIC Prime Portfolio - Institutional Class
(Cost $914) $ 914
-----------
TOTAL INVESTMENTS AT VALUE -- 100.0% (Cost $40,854,232)....... $83,365,897
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.0% ................ 19,627
-----------
NET ASSETS -- 100.0%.......................................... $83,385,524
===========
(a) Non-income producing security.
ADR - American Depositary Receipt
ARS - American Registered Shares
See accompanying notes to financial statements.
17
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
=======================================================================================
SHARES COMMON STOCKS -- 93.8% VALUE
- ---------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 12.3%
2,500 AnnTaylor Stores Corporation (a)............................. $ 79,175
2,000 ArvinMeritor, Inc............................................ 33,640
6,500 Barnes & Noble, Inc. ........................................ 229,190
5,700 BJ's Wholesale Club, Inc. (a)................................ 189,012
2,000 Bob Evans Farms, Inc. ....................................... 60,360
1,500 BorgWarner, Inc.............................................. 137,295
1,700 CBRL Group, Inc.............................................. 69,360
2,500 Coach, Inc. (a).............................................. 118,175
3,500 DreamWorks Animation SKG, Inc. (a)........................... 116,970
2,000 Family Dollar Stores, Inc. ................................. 53,120
7,000 GameStop Corporation - Class A (a)........................... 394,450
2,000 Hanesbrands, Inc. (a)........................................ 56,120
4,500 Harrah's Entertainment, Inc.................................. 391,185
4,000 Hasbro, Inc. ................................................ 111,520
5,500 Herman Miller, Inc. ......................................... 149,270
4,300 Hilton Hotels Corporation.................................... 199,907
3,000 IAC/InterActiveCorp (a)...................................... 89,010
2,500 ITT Educational Services, Inc. (a)........................... 304,225
3,000 Jarden Corporation (a)....................................... 92,820
2,000 Liberty Global, Inc. (a)..................................... 82,040
5,000 MSC Industrial Direct Company, Inc........................... 252,950
3,700 OfficeMax, Inc. ............................................. 126,799
5,800 O'Reilly Automotive, Inc. (a)................................ 193,778
3,000 Phillips-Van Heusen Corporation.............................. 157,440
2,000 Ross Stores, Inc............................................. 51,280
3,500 Saks, Inc. (a)............................................... 60,025
2,500 Scholastic Corporation (a)................................... 87,150
6,000 Service Corporation International............................ 77,400
3,000 Sinclair Broadcast Group, Inc. .............................. 36,120
2,000 Snap-on, Inc................................................. 99,080
2,500 Sotheby's.................................................... 119,475
2,000 Vail Resorts, Inc. (a)....................................... 124,580
-----------
4,342,921
-----------
CONSUMER STAPLES -- 2.0%
5,400 Church & Dwight Company, Inc................................. 254,016
6,000 Hormel Foods Corporation..................................... 214,680
4,700 J.M. Smucker Company......................................... 251,074
-----------
719,770
-----------
ENERGY -- 7.4%
3,760 Cameron International Corporation (a)........................ 347,010
8,000 FMC Technologies, Inc. (a)................................... 461,280
4,350 Murphy Oil Corporation....................................... 304,022
2,800 Newfield Exploration Company (a)............................. 134,848
5,360 Noble Corporation............................................ 262,908
4,800 Peabody Energy Corporation................................... 229,776
5,000 Pride International, Inc. (a)................................ 182,750
4,500 Smith International, Inc..................................... 321,300
5,800 Valero Energy Corporation.................................... 389,644
-----------
2,633,538
-----------
18
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
SHARES COMMON STOCKS -- 93.8% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
FINANCIALS -- 14.1%
8,400 American Financial Group, Inc................................ $ 239,316
7,300 Associated Banc-Corp......................................... 216,299
6,199 Banco Bilbao Vizcaya Argentaria, S.A. - ADR ................. 144,313
6,000 Bank of Hawaii Corporation................................... 317,100
10,050 Berkley (W.R.) Corporation................................... 297,781
9,000 Brown & Brown, Inc. ......................................... 236,700
5,600 Cullen/Frost Bankers, Inc.................................... 280,672
10,250 Eaton Vance Corporation...................................... 409,590
2,600 Everest Re Group Ltd......................................... 286,624
9,300 HCC Insurance Holdings, Inc.................................. 266,352
10,400 Jefferies Group, Inc......................................... 289,432
2,900 Legg Mason, Inc.............................................. 244,441
4,600 Liberty Property Trust....................................... 184,966
1,129 PNC Financial Services Group, Inc............................ 76,885
6,941 Potlatch Corporation......................................... 312,553
4,000 Radian Group, Inc............................................ 93,120
7,000 Rayonier, Inc................................................ 336,280
5,617 State Street Corporation..................................... 382,855
3,300 Westamerica Bancorporation................................... 164,373
5,200 Wilmington Trust Corporation................................. 202,280
-----------
4,981,932
-----------
HEALTH CARE -- 12.0%
1,400 Alcon, Inc................................................... 201,488
2,500 Applera Corporation - Applied Biosystems Group............... 86,600
3,450 Barr Pharmaceuticals, Inc. (a)............................... 196,339
2,500 Bio-Rad Laboratories, Inc. - Class A (a)..................... 226,250
1,500 Cephalon, Inc. (a)........................................... 109,590
8,000 Community Health Systems, Inc. (a)........................... 251,520
7,000 Covance, Inc. (a)............................................ 545,300
8,250 Coventry Health Care, Inc. (a)............................... 513,233
5,600 DENTSPLY International, Inc. ................................ 233,184
1,000 Elan Corporation plc - ADR (a)............................... 21,040
4,000 Fresenius Medical Care AG & Company - ADR.................... 212,240
12,000 Gilead Sciences, Inc. (a).................................... 490,440
2,800 Henry Schein, Inc. (a)....................................... 170,352
1,000 Kyphon, Inc. (a)............................................. 70,000
1,000 Millipore Corporation (a).................................... 75,800
7,700 Mylan Laboratories, Inc. .................................... 122,892
2,000 ResMed, Inc. (a)............................................. 85,740
4,500 Techne Corporation (a)....................................... 283,860
3,000 UnitedHealth Group, Inc. .................................... 145,290
4,600 Varian Medical Systems, Inc. (a)............................. 192,694
-----------
4,233,852
-----------
INDUSTRIALS -- 15.8%
3,000 Alexander & Baldwin, Inc. ................................... 150,390
7,500 AMETEK, Inc.................................................. 324,150
5,000 ChoicePoint, Inc. (a)........................................ 189,600
6,000 C.H. Robinson Worldwide, Inc. ............................... 325,740
3,000 Corporate Executive Board Company............................ 222,720
19
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
SHARES COMMON STOCKS -- 93.8% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
INDUSTRIALS -- 15.8% (CONTINUED)
6,000 Donaldson Company, Inc....................................... $ 250,560
6,000 Expeditors International of Washington, Inc.................. 283,800
7,000 Fastenal Company............................................. 317,870
3,500 Goodrich Corporation......................................... 238,805
6,000 Graco, Inc. ................................................. 234,660
6,000 Jacobs Engineering Group, Inc. (a)........................... 453,480
2,000 Joy Global, Inc.............................................. 101,720
3,000 L-3 Communications Holdings, Inc. ........................... 306,420
4,000 Manpower, Inc. .............................................. 257,400
3,000 Overseas Shipholding Group, Inc. ............................ 230,490
5,000 SPX Corporation.............................................. 462,800
9,000 Stericycle, Inc. (a)......................................... 514,440
2,750 Teleflex, Inc. .............................................. 214,280
2,000 Thomas & Betts Corporation (a)............................... 117,280
9,000 Trinity Industries, Inc...................................... 337,860
1,000 WESCO International, Inc. (a)................................ 42,940
-----------
5,577,405
-----------
INFORMATION TECHNOLOGY -- 17.2%
8,000 Activision, Inc. (a)......................................... 172,720
8,000 Acxiom Corporation........................................... 158,320
8,500 ADC Telecommunications, Inc. (a)............................. 166,685
5,000 ADTRAN, Inc.................................................. 115,150
4,000 Advent Software, Inc. (a).................................... 187,880
5,000 Alliance Data Systems Corporation (a)........................ 387,200
8,000 Arrow Electronics, Inc. (a).................................. 340,160
3,500 CDW Corporation.............................................. 305,200
6,000 Cerner Corporation (a)....................................... 358,860
4,500 CheckFree Corporation (a).................................... 209,430
4,000 Cognizant Technology Solutions Corporation (a)............... 319,080
6,500 Cree, Inc. (a)............................................... 202,150
4,000 DST Systems, Inc. (a)........................................ 343,240
1,000 Electronic Arts, Inc. (a).................................... 55,990
5,500 Harris Corporation........................................... 317,845
10,000 Integrated Device Technology, Inc. (a)....................... 154,800
9,000 Jack Henry & Associates, Inc................................. 232,740
1,500 Koninklijke Philips Electronics N.V. - ADR................... 67,410
7,000 Lam Research Corporation (a)................................. 372,820
5,000 Linear Technology Corporation................................ 174,950
6,000 Macrovision Corporation (a).................................. 147,780
5,000 Microchip Technology, Inc. .................................. 181,600
8,000 National Instruments Corporation............................. 274,640
4,000 Plantronics, Inc. ........................................... 114,200
8,000 SanDisk Corporation (a)...................................... 440,800
7,000 Xilinx, Inc. ................................................ 182,980
2,500 Zebra Technologies Corporation - Class A (a)................. 91,225
-----------
6,075,855
-----------
20
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
SHARES COMMON STOCKS -- 93.8% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
MATERIALS -- 5.9%
4,000 Airgas, Inc. ................................................ $ 206,520
9,000 Albemarle Corporation........................................ 397,800
4,000 Cabot Corporation............................................ 142,120
3,200 Eagle Materials, Inc. ....................................... 114,368
3,000 Martin Marietta Materials, Inc............................... 400,650
4,000 Scotts Miracle-Gro Company (The) - Class A ................. 171,000
5,000 Sonoco Products Company...................................... 150,900
6,500 Steel Dynamics, Inc.......................................... 303,550
7,000 Valspar Corporation (The).................................... 190,470
-----------
2,077,378
-----------
TELECOMMUNICATIONS SERVICES -- 0.2%
1,000 Telephone and Data Systems, Inc.............................. 66,750
-----------
UTILITIES -- 6.9%
7,000 AGL Resources, Inc........................................... 277,340
8,300 Alliant Energy Corporation................................... 318,056
7,000 Equitable Resources, Inc. ................................... 363,090
8,850 MDU Resources Group, Inc. ................................... 246,384
5,750 ONEOK, Inc................................................... 272,550
7,900 Pepco Holdings, Inc. ........................................ 213,932
10,800 Puget Energy, Inc............................................ 264,276
6,300 SCANA Corporation............................................ 244,062
5,000 Wisconsin Energy Corporation................................. 225,150
-----------
2,424,840
-----------
TOTAL COMMON STOCKS (Cost $22,801,766)....................... $33,134,241
-----------
=======================================================================================
PAR VALUE COMMERCIAL PAPER -- 6.2% VALUE
- ---------------------------------------------------------------------------------------
$1,773,000 Deutsche Bank AG, discount, due 10/01/2007................... $ 1,773,000
406,000 UBS AG, discount, due 10/01/2007............................. 406,000
-----------
TOTAL COMMERCIAL PAPER (Cost $2,179,000)..................... $ 2,179,000
-----------
=======================================================================================
SHARES MONEY MARKET FUNDS -- 0.0% VALUE
- ---------------------------------------------------------------------------------------
1,660 AIM STIT - STIC Prime Portfolio - Institutional Class
(Cost $1,660) $ 1,660
-----------
TOTAL INVESTMENTS AT VALUE -- 100.0% (Cost $24,982,426)...... $35,314,901
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.0%).............. (2,068)
-----------
NET ASSETS -- 100.0%......................................... $35,312,833
===========
(a) Non-income producing security.
ADR - American Depositary Receipt
See accompanying notes to financial statements.
21
THE GOVERNMENT STREET BOND FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
=======================================================================================
PAR VALUE U.S. TREASURY AND AGENCY OBLIGATIONS -- 26.8% VALUE
- ---------------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 0.4%
$ 100,000 5.625%, due 05/15/2008........................................ $ 100,891
-----------
FEDERAL HOME LOAN BANK -- 19.1%
1,000,000 5.25%, due 01/30/2008......................................... 1,000,931
735,000 5.10%, due 03/06/2008......................................... 735,528
500,000 5.375%, due 09/14/2009........................................ 500,027
2,000,000 5.00%, due 08/16/2011......................................... 1,998,446
1,000,000 5.00%, due 06/13/2012......................................... 997,385
-----------
5,232,317
-----------
FEDERAL HOME MORTGAGE LOAN CORPORATION -- 7.3%
1,000,000 5.25%, due 05/07/2009........................................ 1,000,761
1,000,000 5.375%, due 01/09/2014....................................... 1,004,319
-----------
2,005,080
-----------
TOTAL U.S. TREASURY AND AGENCY OBLIGATIONS (Cost $7,332,972).. $ 7,338,288
-----------
=======================================================================================
PAR VALUE MORTGAGE-BACKED SECURITIES -- 23.3% VALUE
- ---------------------------------------------------------------------------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION -- 7.1%
$ 39,816 Pool #438434, 6.50%, due 01/15/2013.......................... $ 40,627
5,585 Pool #470177, 7.00%, due 03/15/2014.......................... 5,754
14,080 Pool #518403, 7.00%, due 09/15/2014.......................... 14,505
980 Pool #181540, 8.00%, due 02/15/2017.......................... 1,038
154,366 Pool #581879, 6.50%, due 03/15/2017.......................... 157,508
14,514 Pool #493659, 6.50%, due 12/15/2018.......................... 14,837
65,312 Pool #476695, 6.50%, due 10/15/2023.......................... 66,766
32,283 Pool #366710, 6.50%, due 02/15/2024.......................... 33,002
28,440 Pool #453826, 7.25%, due 09/15/2027.......................... 29,603
49,503 Pool #412360, 7.00%, due 11/15/2027.......................... 51,326
148,400 Pool #447408, 7.00%, due 01/15/2028.......................... 153,866
12,360 Pool #454162, 7.00%, due 05/15/2028.......................... 12,816
99,458 Pool #780825, 6.50%, due 07/15/2028.......................... 101,672
21,400 Pool #2617, 7.50%, due 07/20/2028............................ 22,198
18,262 Pool #158794, 7.00%, due 09/15/2028.......................... 18,935
17,723 Pool #486760, 6.50%, due 12/15/2028.......................... 18,118
62,932 Pool #781096, 6.50%, due 12/15/2028.......................... 64,334
65,154 Pool #781136, 7.00%, due 12/15/2028.......................... 67,553
46,819 Pool #506618, 7.00%, due 03/15/2029.......................... 48,544
12,422 Pool #511562, 7.50%, due 07/15/2030.......................... 12,935
69,557 Pool #448316, 6.50% due 04/15/2031.......................... 71,105
41,785 Pool #530606, 6.50% due 04/15/2031.......................... 42,716
24,903 Pool #545820, 7.00% due 06/15/2031.......................... 25,820
181,400 Pool #781330, 6.00%, due 09/15/2031.......................... 182,569
62,053 Pool #3228, 6.50%, due 04/20/2032............................ 63,415
89,072 Pool #569903, 6.50%, due 06/15/2032.......................... 91,055
543,651 Pool #595934, 6.00%, due 09/15/2032.......................... 547,154
-----------
1,959,771
-----------
22
THE GOVERNMENT STREET BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
PAR VALUE MORTGAGE-BACKED SECURITIES -- 23.3% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 8.4%
$ 858,705 Pool #01173, 5.50%, due 06/01/2017........................... $ 856,176
1,461,028 Pool #G18056, 5.00%, due 06/01/2020.......................... 1,432,521
-----------
2,288,697
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -- 7.8%
642,999 Pool #635149, 5.50%, due 07/01/2017.......................... 641,506
1,536,366 Pool #255808, 5.00%, due 07/01/2025.......................... 1,483,385
-----------
2,124,891
-----------
TOTAL MORTGAGE-BACKED SECURITIES (Cost $6,529,417)........... $ 6,373,359
-----------
=======================================================================================
PAR VALUE CORPORATE BONDS -- 29.1% VALUE
- ---------------------------------------------------------------------------------------
FINANCE -- 19.2%
American General Finance Corporation,
$1,500,000 4.50%, due 11/15/2007 ................................... $ 1,498,237
CIT Group, Inc ,
2,000,000 4 75%, due 12/15/2010 ................................... 1,903,466
JPMorgan Chase & Company,
1,000,000 4 50%, due 01/15/2012 ................................... 965,065
Student Loan Marketing Association,
1,000,000 5 125%, due 08/27/2012 .................................. 905,273
-----------
TOTAL FINANCE CORPORATE BONDS ............................... 5,272,041
-----------
INDUSTRIAL -- 9 9%
Ford Motor Company,
1,000,000 7 25%, due 10/01/2008 ................................... 990,000
General Dynamics Corporation,
1,750,000 4 50%, due 08/15/2010 ................................... 1,725,339
-----------
TOTAL INDUSTRIAL CORPORATE BONDS ............................ 2,715,339
-----------
TOTAL CORPORATE BONDS (Cost $8,283,346) ..................... $ 7,987,380
-----------
=======================================================================================
PAR VALUE COMMERCIAL PAPER -- 20.2% VALUE
- ---------------------------------------------------------------------------------------
$4,143,000 Deutsche Bank AG, discount, due 10/01/2007 ................. $ 4,143,000
1,383,000 UBS AG, discount, due 10/01/2007............................. 1,383,000
-----------
TOTAL COMMERCIAL PAPER (Cost $5,526,000)..................... $ 5,526,000
-----------
23
THE GOVERNMENT STREET BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
SHARES MONEY MARKET FUNDS -- 0.0% VALUE
- ---------------------------------------------------------------------------------------
2,690 AIM STIT - STIC Prime Portfolio -
Institutional Class (Cost $2,690) ........................ $ 2,690
-----------
TOTAL INVESTMENTS AT VALUE -- 99.4% (Cost $27,674,425)....... $27,227,717
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.6%................ 160,226
-----------
NET ASSETS -- 100.0%......................................... $27,387,943
===========
See accompanying notes to financial statements.
24
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
=======================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 96.3% VALUE
- ---------------------------------------------------------------------------------------
Alabama Drinking Water Financing Auth., Rev.,
$250,000 4.00%, due 08/15/2014................................... $ 253,655
-----------
Alabama Special Care Facilities Financing Auth.,
Birmingham, Rev.,
500,000 4.50%, due 11/01/2009, ETM.............................. 509,275
400,000 5.375%, due 11/01/2012, ETM............................. 400,596
-----------
909,871
-----------
Alabama Special Care Facilities Financing Auth.,
Mobile Hospital, Rev.,
250,000 4.50%, due 11/01/2010, ETM.............................. 255,763
-----------
Alabama State Federal Highway Financing Authority, Rev.,
210,000 5.00%, due 03/01/2009................................... 214,425
300,000 5.00%, due 03/01/2016................................... 315,777
-----------
530,202
-----------
Alabama State, GO,
250,000 5.00%, due 06/01/2012................................... 258,903
300,000 5.00%, due 09/01/2015................................... 313,659
300,000 5.00%, due 09/01/2016................................... 313,659
300,000 5.00%, due 09/01/2017................................... 322,413
-----------
1,208,634
-----------
Alabama State, Parks System Improvement Corporation, GO,
200,000 5.50%, due 06/01/2010................................... 210,120
-----------
Alabama State Public School & College Auth.,
Capital Improvements, Rev.,
300,000 5.00%, due 02/01/2010................................... 309,813
475,000 5.00%, due 11/01/2012................................... 488,946
600,000 5.125%, due 11/01/2013.................................. 618,408
525,000 5.125%, due 11/01/2015.................................. 541,107
-----------
1,958,274
-----------
Alabama State Public School & College Auth., Rev.,
355,000 5.00%, due 05/01/2010................................... 367,627
-----------
Alabama Water Pollution Control Auth., Rev.,
500,000 5.00%, due 08/15/2010................................... 519,665
-----------
Anniston, AL, Waterworks & Sewer Board, Rev.,
400,000 4.00%, due 06/01/2015................................... 403,276
-----------
Athens, AL, Electric Revenue Warrants, GO,
500,000 3.00%, due 06/01/2011................................... 483,765
-----------
Athens, AL, School Warrants, GO,
335,000 5.05%, due 08/01/2015................................... 342,199
-----------
Auburn, AL, Capital Improvements, School Warrants, GO,
225,000 5.00%, due 08/01/2012................................... 238,768
-----------
25
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 96.3% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
Auburn, AL, GO,
$ 285,000 4.25%, due 08/01/2009................................... $ 288,870
-----------
Auburn, AL, Water Works Board, Rev.,
335,000 5.00%, due 07/01/2015................................... 353,291
-----------
Auburn University, AL, General Fee Rev.,
400,000 4.45%, due 06/01/2011................................... 405,720
-----------
Baldwin Co., AL, Board of Education, Rev. Warrants,
200,000 5.20%, due 06/01/2009................................... 202,266
300,000 5.00%, due 06/01/2010................................... 310,371
-----------
512,637
-----------
Baldwin Co., AL, GO, Warrants,
500,000 4.50%, due 11/01/2008................................... 505,565
200,000 5.00%, due 02/01/2015................................... 213,496
320,000 5.00%, due 02/01/2017................................... 346,227
-----------
1,065,288
-----------
Birmingham, AL, Special Care Facilities Financing
Authority, Rev.,
300,000 3.70%, due 06/01/2009................................... 301,035
-----------
Decatur, AL, GO, Warrants,
300,000 5.00%, due 06/01/2009................................... 302,820
-----------
Decatur, AL, Water Rev.,
100,000 5.00%, due 05/01/2014................................... 103,057
-----------
Dothan, AL, GO,
500,000 5.50%, due 09/01/2014................................... 523,315
-----------
Fairhope, AL, Warrants,
295,000 5.10%, due 06/01/2014................................... 307,576
-----------
Florence, AL, School Warrants,
200,000 4.65%, due 12/01/2012................................... 206,292
-----------
Foley, AL, Utilities Board, Rev.,
500,000 4.00%, due 11/01/2007................................... 500,220
-----------
Homewood, AL, GO, Warrants,
500,000 5.00%, due 09/01/2014 .................................. 530,495
250,000 5.00%, due 09/01/2015................................... 270,303
-----------
800,798
-----------
Houston Co., AL, GO,
300,000 5.60%, due 10/15/2014................................... 318,048
-----------
26
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 96.3% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
Huntsville, AL, Capital Improvements, GO,
$ 100,000 3.25%, due 11/01/2010................................... $ 98,571
-----------
Huntsville, AL, Electric Systems, Rev.,
250,000 4.80%, due 12/01/2012................................... 255,370
-----------
Huntsville, AL, GO,
400,000 5.50%, due 08/01/2009................................... 414,344
500,000 5.00%, due 08/01/2011................................... 525,615
250,000 5.25%, due 11/01/2012................................... 256,745
-----------
1,196,704
-----------
Huntsville, AL, Water Systems, Rev.,
200,000 4.70%, due 11/01/2013................................... 204,150
-----------
Jefferson Co., AL, Sewer Rev.,
225,000 5.00%, due 02/01/2041, Prerefunded 02/01/2011 @ 101..... 236,822
-----------
Madison, AL, Warrants,
200,000 4.40%, due 02/01/2011................................... 203,734
400,000 4.85%, due 02/01/2013................................... 409,488
-----------
613,222
-----------
Madison Co., AL, Board of Education, Capital Outlay
Tax Antic. Warrants,
400,000 5.20%, due 03/01/2011................................... 418,584
250,000 5.20%, due 03/01/2014................................... 261,080
-----------
679,664
-----------
Mobile, AL, GO, Warrants,
400,000 4.75%, due 02/15/2014................................... 420,068
-----------
Mobile Co., AL, Refunding & Improvement Warrants, GO,
100,000 4.50%, due 08/01/2013................................... 104,474
-----------
Montgomery, AL, GO,
300,000 5.00%, due 11/01/2015................................... 314,232
-----------
Montgomery, AL, Waterworks & Sanitation, Rev.,
500,000 5.00%, due 09/01/2008................................... 507,030
350,000 5.25%, due 09/01/2011................................... 371,346
-----------
878,376
-----------
Mountain Brook, AL, City Board of Education, Capital
Outlay Warrants,
405,000 4.80%, due 02/15/2011................................... 405,377
-----------
Opelika, AL, GO,
210,000 4.00%, due 03/01/2010................................... 212,367
-----------
Scottsboro, AL, Waterworks Sewer & Gas Board, Rev.,
200,000 4.35%, due 08/01/2011................................... 202,748
-----------
27
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
=======================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 96.3% (CONTINUED) VALUE
- ---------------------------------------------------------------------------------------
Shelby Co., AL, Board of Education, Rev. Warrants,
$ 500,000 4.80%, due 02/01/2011.................................... $ 512,335
-----------
St. Clair Co., AL, GO,
145,000 4.00%, due 08/01/2013.................................... 148,178
205,000 4.00%, due 08/01/2014.................................... 209,551
-----------
357,729
-----------
Trussville, AL, Warrants,
400,000 4.30%, due 10/01/2010.................................... 408,716
-----------
Tuscaloosa, AL, Board of Education, GO,
300,000 4.625%, due 08/01/2008................................... 300,249
-----------
Tuscaloosa, AL, Board of Education, Special Tax Warrants,
300,000 4.85%, due 02/15/2013.................................... 300,279
-----------
Tuscaloosa, AL, GO, Warrants,
145,000 4.25%, due 02/15/2011.................................... 148,062
400,000 5.55%, due 01/01/2015, Prerefunded 01/01/2010 @ 101...... 420,976
500,000 5.45%, due 01/01/2014.................................... 525,145
-----------
1,094,183
-----------
Tuscaloosa Co., AL, GO, Warrants,
425,000 4.30%, due 10/01/2009.................................... 431,949
-----------
University of Alabama, AL, General Fee Rev.,
240,000 4.10%, due 12/01/2013.................................... 246,206
-----------
University of Alabama, AL, Series A, Rev.,
375,000 4.00%, due 10/01/2010.................................... 380,096
-----------
Vestavia Hills, AL, Warrants,
565,000 5.00%, due 02/01/2012.................................... 596,273
-----------
TOTAL ALABAMA FIXED RATE REVENUE AND GENERAL
OBLIGATION (GO) BONDS (Cost $23,783,632)................. $24,120,946
-----------
=======================================================================================
SHARES MONEY MARKET FUNDS -- 2.7% VALUE
- ---------------------------------------------------------------------------------------
670,991 Alpine Muncipal Money Market Fund - Class I (Cost $670,991).. $ 670,991
-----------
TOTAL INVESTMENTS AT VALUE -- 99.0% (Cost $24,454,623)........ $24,791,937
-----------
OTHER ASSETS IN EXCESS OF LIABILITIES -- 1.0%................. 251,258
-----------
NET ASSETS -- 100.0%.......................................... $25,043,195
===========
See accompanying notes to financial statements.
28
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2007 (UNAUDITED)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The Government Street Equity Fund, The Government Street Mid-Cap Fund, The
Government Street Bond Fund and The Alabama Tax Free Bond Fund (the Funds) are
each a no-load series of the Williamsburg Investment Trust (the Trust). The
Trust, an open-end management investment company registered under the Investment
Company Act of 1940, was organized as a Massachusetts business trust on July 18,
1988.
The Government Street Equity Fund's investment objective is to seek capital
appreciation through the compounding of dividends and capital gains, both
realized and unrealized, by investing in common stocks.
The Government Street Mid-Cap Fund's investment objective is to seek capital
appreciation by investing in common stocks of mid-cap companies.
The Government Street Bond Fund's investment objectives are to preserve capital,
to provide current income and to protect the value of the portfolio against the
effects of inflation.
The Alabama Tax Free Bond Fund's investment objectives are to provide current
income exempt from federal income taxes and from the personal income taxes of
Alabama and to preserve capital.
The following is a summary of the Funds' significant accounting policies:
Securities valuation -- The Funds' portfolio securities are valued as of the
close of business of the regular session of the New York Stock Exchange
(normally 4:00 p.m., Eastern time). Securities traded on a national stock
exchange are valued based upon the closing price on the principal exchange where
the security is traded. Securities which are quoted by NASDAQ are valued at the
NASDAQ Official Closing Price. Securities which are traded over-the-counter are
valued at the last sales price, if available, otherwise, at the last quoted bid
price. It is expected that fixed income securities will ordinarily be traded in
the over-the-counter market, and common stocks will ordinarily be traded on a
national securities exchange, but may also be traded in the over-the-counter
market. When market quotations are not readily available, securities may be
valued on the basis of prices provided by an independent pricing service.
Short-term instruments (those with remaining maturities of 60 days or less) are
valued at amortized cost, which approximates market value. Securities and other
assets for which no quotations are readily available or are considered to be
unreliable due to significant market or other events will be valued in good
faith at fair value using methods determined by the Board of Trustees. Such
methods of fair valuation may include, but are not limited to: multiple of
earnings, multiple of book value, discount from market of a similar freely
traded security, purchase price of security, subsequent private transactions in
the security or related securities, or a combination of these and other factors.
29
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Share valuation -- The net asset value per share of each Fund is calculated
daily by dividing the total value of each Fund's assets, less liabilities, by
the number of shares outstanding. The offering price and redemption price per
share of each Fund is equal to the net asset value per share.
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed-income
securities purchased are amortized using the interest method.
Repurchase agreements -- The Funds may enter into joint repurchase agreements
with other funds within the Trust. The joint repurchase agreement, which is
collateralized by U.S. Government obligations, is valued at cost which, together
with accrued interest, approximates market value. At the time the Funds enter
into the joint repurchase agreement, the Funds take possession of the underlying
securities and the seller agrees that the value of the underlying securities,
including accrued interest, will at all times be equal to or exceed the face
amount of the repurchase agreement. In addition, each Fund actively monitors and
seeks additional collateral, as needed.
Distributions to shareholders -- Dividends arising from net investment income
are declared and paid quarterly to shareholders of The Government Street Equity
Fund; declared and paid annually to shareholders of The Government Street
Mid-Cap Fund; declared and paid monthly to shareholders of The Government Street
Bond Fund; and declared daily and paid monthly to shareholders of The Alabama
Tax Free Bond Fund. Net realized short-term capital gains, if any, may be
distributed throughout the year and net realized long-term capital gains, if
any, are distributed at least once each year. The amount of distributions from
net investment income and net realized gains are determined in accordance with
federal income tax regulations which may differ from accounting principles
generally accepted in the United States. These "book/tax" differences are either
temporary or permanent in nature. Certain Funds may utilize earnings and profits
distributed to shareholders on redemptions of shares as part of the dividends
paid deduction for income tax purposes. The tax character of distributions paid
during the periods ended September 30, 2007 and March 31, 2007 are as follows:
PERIODS ORDINARY EXEMPT-INTEREST LONG-TERM TOTAL
ENDED INCOME DIVIDENDS GAINS DISTRIBUTIONS
- --------------------------------------------------------------------------------------------------------------
Government Street Equity Fund 09/30/07 $ 430,950 $ -- $ -- $ 430,950
03/31/07 $ 1,084,650 $ -- $ 12,812,704 $ 13,897,354
- --------------------------------------------------------------------------------------------------------------
Government Street Mid-Cap Fund 09/30/07 $ -- $ -- $ -- $ --
03/31/07 $ 154,752 $ -- $ 2,609,394 $ 2,764,146
- --------------------------------------------------------------------------------------------------------------
Government Street Bond Fund 09/30/07 $ 666,674 $ -- $ -- $ 666,674
03/31/07 $ 1,429,567 $ -- $ -- $ 1,429,567
- --------------------------------------------------------------------------------------------------------------
Alabama Tax Free Bond Fund 09/30/07 $ -- $ 440,770 $ -- $ 440,770
03/31/07 $ -- $ 876,155 $ -- $ 876,155
- --------------------------------------------------------------------------------------------------------------
30
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Security transactions -- Security transactions are accounted for on trade date.
Gains and losses on securities sold are determined on a specific identification
basis.
Common expenses -- Common expenses of the Trust are allocated among the funds of
the Trust based on relative net assets of each fund or the nature of the
services performed and the relative applicability to each fund.
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates.
Federal income tax -- It is each Fund's policy to comply with the special
provisions of Subchapter M of the Internal Revenue Code applicable to regulated
investment companies. As provided therein, in any fiscal year in which a Fund so
qualifies, and distributes at least 90% of its taxable net income, the Fund (but
not the shareholders) will be relieved of federal income tax on the income
distributed. Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
The following information is computed on a tax basis for each item as of
September 30, 2007:
- -------------------------------------------------------------------------------------------------------------------
GOVERNMENT GOVERNMENT GOVERNMENT ALABAMA
STREET STREET STREET TAX FREE
EQUITY MID-CAP BOND BOND
FUND FUND FUND FUND
- -------------------------------------------------------------------------------------------------------------------
Cost of portfolio investments $ 40,854,232 $ 24,982,426 $ 27,752,324 $ 24,508,263
============ ============ ============ ============
Gross unrealized appreciation $ 42,730,555 $ 10,928,265 $ 35,002 $ 346,985
Gross unrealized depreciation (218,890) (595,790) (559,609) (63,311)
------------ ------------ ------------ ------------
Net unrealized appreciation (depreciation) 42,511,665 10,332,475 (524,607)
283,674
Accumulated undistributed ordinary income 157,731 108,381 14,042 24,287
Capital loss carryforwards -- -- (2,751,670) (519)
Post-October losses -- -- (116,516) --
Accumulated undistributed gains 1,371,935 187,441 -- --
Other gains (losses) -- -- (7,710) 10,237
Other temporary differences (6,350) -- (6,461) (24,287)
------------ ------------ ------------ ------------
Total distributable earnings
(accumulated deficit) $ 44,034,981 $ 10,628,297 $ (3,392,922) $ 293,392
============ ============ ============ ============
- -------------------------------------------------------------------------------------------------------------------
31
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for The Government Street Bond Fund and The Alabama
Tax Free Bond Fund is due to certain timing differences in the recognition of
capital gains or losses under income tax regulations and accounting principles
generally accepted in the United States. These "book/tax" differences are
temporary in nature and are primarily due to the tax deferral of losses on wash
sales and/or differing methods in the amortization of discounts and premiums on
fixed income securities.
As of March 31, 2007, The Government Street Bond Fund and The Alabama Tax Free
Bond Fund had the following capital loss carryforwards for federal income tax
purposes:
- --------------------------------------------------------------------------------
EXPIRES
AMOUNT MARCH 31,
- --------------------------------------------------------------------------------
Government Street Bond Fund $ 220,187 2008
195,097 2009
86,819 2010
70,419 2011
218,396 2012
261,545 2013
528,696 2014
1,170,511 2015
------------
$ 2,751,670
============
- --------------------------------------------------------------------------------
Alabama Tax Free Bond Fund $ 519 2009
- --------------------------------------------------------------------------------
These capital loss carryforwards may be utilized in the current and future years
to offset net realized capital gains, if any, prior to distribution to
shareholders.
In addition, The Government Street Bond Fund had net realized capital losses of
$116,516 during the period November 1, 2006 through March 31, 2007, which are
treated for federal income tax purposes as arising during the Fund's tax year
ending March 31, 2008. These "post-October" losses may be utilized in the
current and future years to offset net realized capital gains prior to
distributing such gains to shareholders.
During the six months ended September 30, 2007, The Government Street Equity
Fund and The Government Street Mid-Cap Fund realized $5,656,635 and $140,412,
respectively, of net capital gains resulting from in-kind redemptions - in which
shareholders who redeemed Fund shares received securities held by the Fund
rather than cash. The Funds recognize a gain on in-kind redemptions to the
extent that the value of the distributed securities on the date of redemption
exceeds the cost of those securities. Such gains are not taxable to the Funds
and are not required to be distributed to shareholders. The Funds have
reclassified these amounts against paid-in capital. These reclassifications are
reflected on the Statements of Assets
32
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
and Liabilities. Such reclassifications, the result of permanent differences
between the financial statement and income tax reporting requirements, had no
effect on each Fund's net assets or net asset value per share.
For the six months ended September 30, 2007, The Government Street Bond Fund
reclassified $20,692 of overdistributed net investment income against
accumulated net realized losses and The Alabama Tax Free Bond Fund reclassified
$686 of undistributed net investment income against accumulated net realized
losses on the Statements of Assets and Liabilities due to permanent differences
in the recognition of capital gains or losses under income tax regulations and
accounting principles generally accepted in the United States. These differences
are primarily due to the tax treatment of certain debt obligations and paydown
adjustments. Such reclassifications had no effect on each Fund's net assets or
net asset value per share.
2. INVESTMENT TRANSACTIONS
During the six months ended September 30, 2007, cost of purchases and proceeds
from sales and maturities of investment securities, other than short-term
investments and U.S. government securities, amounted to $3,497,509 and
$15,019,570, respectively, for The Government Street Equity Fund; $1,331,360 and
$1,016,179, respectively, for The Government Street Mid-Cap Fund; $0 and
$976,160, respectively, for The Government Street Bond Fund; and $583,283 and
$1,570,000, respectively, for The Alabama Tax Free Bond Fund.
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Funds' investments are managed by T. Leavell & Associates, Inc. (the
Adviser) under the terms of an Investment Advisory Agreement. Under the
Investment Advisory Agreement, The Government Street Equity Fund pays the
Adviser a fee, which is computed and accrued daily and paid monthly, at an
annual rate of .60% of its average daily net assets up to $100 million and .50%
of such assets in excess of $100 million. The Government Street Mid-Cap Fund
pays the Adviser a fee at an annual rate of .75% of its average daily net
assets. The Government Street Bond Fund pays the Adviser a fee at an annual rate
of .50% of its average daily net assets up to $100 million and .40% of such
assets in excess of $100 million. The Alabama Tax Free Bond Fund pays the
Adviser a fee at an annual rate of .35% of its average daily net assets up to
$100 million and .25% of such assets in excess of $100 million.
For the six months ended September 30, 2007, the Adviser voluntarily undertook
to limit the total operating expenses of The Government Street Mid-Cap Fund, The
Government Street Bond Fund and The Alabama Tax Free Bond Fund to 1.10%, .71%
and .65%, respectively, of each Fund's average daily net assets. Accordingly,
the Adviser voluntarily waived $2,372, $16,985 and $13,827, respectively, of its
investment advisory fees from The Government Street Mid-Cap Fund, The Government
Street Bond Fund and The Alabama Tax Free Bond Fund during the six months ended
September 30, 2007.
Certain officers of the Trust are also officers of the Adviser.
33
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
MUTUAL FUND SERVICES AGREEMENT
Under the terms of a Mutual Fund Services Agreement between the Trust and
Ultimus Fund Solutions, LLC (Ultimus), Ultimus provides administrative, pricing,
accounting, dividend disbursing, shareholder servicing and transfer agent
services for the Funds. For these services, Ultimus receives a monthly fee from
The Government Street Equity Fund, The Government Street Mid-Cap Fund and The
Alabama Tax Free Bond Fund at an annual rate of .15% of each Fund's average
daily net assets up to $25 million; .125% of the next $25 million of such
assets; and .10% of such net assets in excess of $50 million. Additionally, The
Government Street Mid-Cap Fund is subject to a minimum monthly fee of $4,000.
From The Government Street Bond Fund, Ultimus receives a monthly fee at an
annual rate of .075% of the Fund's average daily net assets up to $200 million
and .05% of such assets in excess of $200 million. In addition, each Fund pays
out-of-pocket expenses including, but not limited to, postage, supplies and
costs of pricing the Funds' portfolio securities.
COMPLIANCE CONSULTING AGREEMENT
Under the terms of a Compliance Consulting Agreement between the Trust and
Ultimus, Ultimus provides an individual to serve as the Trust's Chief Compliance
Officer and to administer the Trust's compliance policies and procedures. For
these services, the Funds pay Ultimus an annual base fee of $20,400 plus an
asset-based fee equal to 0.01% per annum on total net assets in excess of $100
million.
Certain officers of the Trust are also officers of Ultimus, or of Ultimus Fund
Distributors, LLC (the Distributor), the principal underwriter of each Fund's
shares and an affiliate of Ultimus. The Distributor receives no compensation
from the Funds for acting as principal underwriter.
4. CONTINGENCIES AND COMMITMENTS
The Funds indemnify the Trust's officers and Trustees for certain liabilities
that might arise from their performance of their duties to the Funds.
Additionally, in the normal course of business the Funds enter into contracts
that contain a variety of representations and warranties and which provide
general indemnifications. The Funds' maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Funds that have not yet occurred. However, based on experience, the Funds expect
the risk of loss to be remote.
34
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
5. ACCOUNTING PRONOUNCEMENTS
On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB
Interpretation No. 48 (FIN 48) "Accounting for Uncertainty in Income Taxes." FIN
48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken in the course of preparing the fund's tax
returns to determine whether the tax positions are "more-likely-than-not" of
being sustained by the applicable tax authority. Tax positions not deemed to
meet the more-likely-than-not threshold would be recorded as a tax benefit or
expense in the current year. Adoption of FIN 48 is required for fiscal years
beginning after December 15, 2006 and is to be applied to all open tax years as
of the effective date. As a result, the Funds have adopted FIN 48 with this
Semi-Annual Report. Based on its analysis, management does not believe that the
adoption of FIN 48 has a material impact on the financial statements.
In September 2006, the Financial Accounting Standards Board issued STATEMENT ON
FINANCIAL ACCOUNTING STANDARDS (SFAS) NO. 157, "FAIR VALUE MEASUREMENTS." This
standard establishes a single authoritative definition of fair value, sets out a
framework for measuring fair value and requires additional disclosures about
fair value measurements. SFAS No. 157 applies to fair value measurements already
required or permitted by existing standards. SFAS No. 157 is effective for
financial statements issued for fiscal years beginning after November 15, 2007
and interim periods within those fiscal years. The changes to current generally
accepted accounting principles from the application of SFAS No. 157 relate to
the definition of fair value, the methods used to measure fair value, and the
expanded disclosures about fair value measurements. As of September 30, 2007,
the Funds do not believe the adoption of SFAS No. 157 will impact the amounts
reported in the financial statements. However, additional disclosures may be
required about the inputs used to develop the measurements and the effect of
certain of the measurements reported on the statement of changes in net assets
for a fiscal period.
35
THE GOVERNMENT STREET FUNDS
ABOUT YOUR FUNDS' EXPENSES (UNAUDITED)
================================================================================
We believe it is important for you to understand the impact of costs on your
investment. All mutual funds have operating expenses. As a shareholder of the
Funds, you incur ongoing costs, including management fees and other fund
expenses. Operating expenses, which are deducted from each Fund's gross income,
directly reduce the investment returns of the Funds.
A mutual fund's ongoing costs are expressed as a percentage of its average net
assets. This figure is known as the expense ratio. The following examples are
intended to help you understand the ongoing costs (in dollars) of investing in
the Funds and to compare these costs with the ongoing costs of investing in
other mutual funds. The examples 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 Fund'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
Fund'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
Funds. 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 Funds under the heading "Expenses Paid During Period."
HYPOTHETICAL 5% RETURN - This section is intended to help you compare the Funds'
costs with those of other mutual funds. It assumes that each Fund had an annual
return of 5% before expenses during the period shown, but that the expense ratio
is unchanged. In this case, because the returns used are not the Funds' 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
Fund'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 Funds do not charge transaction fees, such as
purchase or redemption fees, nor do they carry a "sales load."
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.
36
THE GOVERNMENT STREET FUNDS
ABOUT YOUR FUNDS' EXPENSES (UNAUDITED)
(CONTINUED)
================================================================================
More information about the Funds' expenses, including historical expense ratios,
can be found in this report. For additional information on operating expenses
and other shareholder costs, please refer to the Funds' prospectus.
- --------------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
April 1, 2007 Sept. 30, 2007 During Period*
- --------------------------------------------------------------------------------------
THE GOVERNMENT STREET EQUITY FUND
- --------------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,084.70 $4.39
- --------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,020.86 $4.26
- --------------------------------------------------------------------------------------
THE GOVERNMENT STREET MID-CAP FUND
- --------------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,066.30 $5.70
- --------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,019.55 $5.57
- --------------------------------------------------------------------------------------
THE GOVERNMENT STREET BOND FUND
- --------------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,018.60 $3.59
- --------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,021.51 $3.60
- --------------------------------------------------------------------------------------
THE ALABAMA TAX FREE BOND FUND
- --------------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $1,017.40 $3.29
- --------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,021.81 $3.29
- --------------------------------------------------------------------------------------
* Expenses are equal to the Funds' annualized expense ratios for the period as
stated below, multiplied by the average account value over the period,
multiplied by 183/365 (to reflect the one-half year period).
The Government Street Equity Fund 0.84%
The Government Street Mid-Cap Fund 1.10%
The Government Street Bond Fund 0.71%
The Alabama Tax Free Bond Fund 0.65%
37
THE GOVERNMENT STREET FUNDS
OTHER INFORMATION (UNAUDITED)
================================================================================
A description of the policies and procedures that the Funds use to vote proxies
relating to portfolio securities is available without charge upon request by
calling toll-free 1-866-738-1125, or on the Securities and Exchange Commission's
(SEC) website at http://www.sec.gov. Information regarding how the Funds 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
1-866-738-1125 or on the SEC's website at http://www.sec.gov.
The Trust files a complete listing of portfolio holdings for the Funds with the
SEC as of the first and third quarters of each fiscal year on Form N-Q. The
filings are available upon request, by calling 1-866-738-1125. Furthermore, you
may obtain a copy of these filings on the SEC's website at http://www.sec.gov.
The Trust's Forms N-Q may also be reviewed and copied at the SEC's Public
Reference Room in Washington, DC, and information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330.
38
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================================================================================
THE GOVERNMENT STREET FUNDS
---------------------------------
No Load Mutual Funds
INVESTMENT ADVISER
T. Leavell & Associates, Inc.
150 Government Street
Post Office Box 1307
Mobile, AL 36633
ADMINISTRATOR
Ultimus Fund Solutions, LLC
P.O. Box 46707
Cincinnati, OH 45246-0707
1-866-738-1125
LEGAL COUNSEL
Sullivan & Worcester LLP
One Post Office Square
Boston, MA 02109
INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
Ernst & Young LLP
1900 Scripps Center
312 Walnut Street
Cincinnati, OH 45202
BOARD OF TRUSTEES
Austin Brockenbrough, III
John T. Bruce
Charles M. Caravati, Jr.
Robert S. Harris
J. Finley Lee, Jr.
Richard L. Morrill
Harris V. Morrissette
Erwin H. Will, Jr.
Samuel B. Witt, III
PORTFOLIO MANAGERS
Thomas W. Leavell,
The Government Street Equity Fund
The Government Street Mid-Cap Fund
Timothy S. Healey,
The Government Street Mid-Cap Fund
The Alabama Tax Free Bond Fund
Richard E. Anthony, Jr.,
The Government Street Mid-Cap Fund
Mary Shannon Hope,
The Government Street Bond Fund
================================================================================
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. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The registrant's Nominating Committee shall review shareholder recommendations
to fill vacancies on the registrant's board of trustees if such recommendations
are submitted in writing, addressed to the Committee at the registrant's offices
and meet any minimum qualifications adopted by the Committee. The Committee may
adopt, by resolution, a policy regarding its procedures for considering
candidates for the board of trustees, including any recommended by shareholders.
ITEM 11. 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 officers and principal financial officer have
concluded that such disclosure controls and procedures are reasonably designed
and are operating effectively to ensure that material information relating to
the registrant, including its consolidated subsidiaries, is made known to them
by others within those entities, particularly during the period in which this
report is being prepared, and that the information required in filings on Form
N-CSR is recorded, processed, summarized, and reported on a timely basis.
(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 second fiscal quarter of the period covered by this
report that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.
ITEM 12. 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) Williamsburg Investment Trust
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By (Signature and Title)* /s/ John F. Splain
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John F. Splain, Secretary
Date December 5, 2007
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Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ John T. Bruce
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John T. Bruce, President (FBP Value Fund and FBP
Balanced Fund)
Date December 5, 2007
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By (Signature and Title)* /s/ Thomas W. Leavell
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Thomas W. Leavell, President (The Government Street
Equity Fund, The Government Street Bond Fund and The
Alabama Tax Free Bond Fund)
Date December 5, 2007
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By (Signature and Title)* /s/ Charles M. Caravati III
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Charles M. Caravati III, President (The Jamestown
Balanced Fund, The Jamestown Equity Fund and The
Jamestown International Equity Fund)
Date December 5, 2007
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By (Signature and Title)* /s/ Joseph A. Jennings III
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Joseph A. Jennings III, President (The Jamestown
Tax Exempt Virginia Fund)
Date December 5, 2007
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By (Signature and Title)* /s/ Lawrence B. Whitlock, Jr.
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Lawrence B. Whitlock, Jr., President (The
Jamestown Select Fund)
Date December 5, 2007
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By (Signature and Title)* /s/ Joseph L. Antrim III
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Joseph L. Antrim III, President
(The Davenport Equity Fund)
Date December 5, 2007
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By (Signature and Title)* /s/ Mark J. Seger
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Mark J. Seger, Treasurer
Date December 5, 2007
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* Print the name and title of each signing officer under his or her signature.