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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, 2009
----------------------------
Date of reporting period: September 30, 2008
----------------------------
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.
- --------------------------------------------------------------------------------
DAVENPORT ||
- ---------------- || DAVENPORT CORE FUND
ASSET MANAGEMENT ||
SEMI-ANNUAL REPORT
September 30, 2008
(Unaudited)
- --------------------------------------------------------------------------------
THE DAVENPORT CORE FUND
LETTER TO SHAREHOLDERS OCTOBER 16, 2008
================================================================================
Dear Shareholders,
The following chart represents The Davenport Core Fund's (the Fund) performance
and the performance of the S&P 500 Index*, the Fund's primary benchmark for the
periods ended September 30, 2008.
Since Gross
Inception** Expense
Q3 2008 1 Year 3 Years** 5 Years** 10 Years** (1/15/98) Ratio:
- --------------------------------------------------------------------------------
DAVPX -7.34 -19.71 1.93 5.76 4.07 3.75 0.97%
S&P 500 -8.37 -21.98 0.22 5.17 3.06 3.61
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
1-800-281-3217.
* 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
The events of this most recent quarter will be remembered for a long time.
Turmoil in our credit markets and banking system experienced a crescendo that
shook financial markets. During the quarter, we witnessed the following:
government bailouts of Fannie Mae and Freddie Mac, Lehman Brothers declaring
bankruptcy, a government bailout of AIG, Bank of America buying Merrill Lynch at
distressed prices, Washington Mutual being sold to JPMorgan, Wachovia being sold
at distressed prices and, to top it all off, our government proposing and
failing to pass a historic economic rescue bill on the first try. These events
are likely to provide subject matter for many books and movies in coming years.
Clearly, this has been a challenging and unsettling time for investors.
The S&P 500 declined 8.4% during the third quarter and was down 19.3%
year-to-date. The Lipper Equity Income and Russell Midcap indices declined 7.6%
and 12.9%, respectively, for the quarter and were down 18.9% and 19.5%,
respectively, on a year-to-date basis. The Fund strategy was pressured in tandem
with general market weakness, but fared well relative to its benchmark.
What might the world look like when the storm passes? Once the debt bubble is
completely deflated, our financial system and economy are likely to look
markedly different. Put simply, people are likely to approach debt much more
cautiously. We expect an environment in which lenders lend more prudently and
borrowers borrow more prudently. The cost of borrowing will likely be higher and
economic growth could be somewhat muted for a while. We could see stocks rally
from current levels given
1
extreme pessimism, record levels of cash on the sidelines and government efforts
to reflate the economy, but we may be in for a sustained period of more moderate
returns once the credit storm passes.
How are we responding? First of all, we are confident the world is not ending.
That said we have taken on a more defensive posture and are emphasizing
companies that are less dependent on a cyclical rebound. Furthermore, many of
the themes we have been espousing over the past year now seem more relevant than
ever. We continue to believe strongly in the simple concepts of quality,
transparency and visibility. We also think select large cap stocks may become
increasingly appealing. As a group, large-cap companies continue to trade at
very reasonable valuations when compared to small and mid-cap issues. In our
view, these companies offer many advantages including relatively predictable
growth, ready access to capital, global exposure and trading liquidity.
Moreover, these companies shouldn't have to compete as much with private equity
players when looking to buy assets.
Perhaps most important, we are emphasizing companies that will not only survive
this mess, but also have a chance of emerging much stronger. These companies
have very strong balance sheets and are in a position to take advantage of this
environment either by taking business from distressed competitors or buying
assets cheaply. In many cases, these companies are sitting on very large cash
balances. Take Warren Buffett's Berkshire Hathaway for example. The company
recently struck very attractive deals to buy Constellation Energy and stakes in
both Goldman Sachs and General Electric, yet still has roughly $20 billion of
cash at its disposal. In a world of distressed assets, this cash balance becomes
increasingly valuable. Companies such as Exxon Mobil and Microsoft also have
extremely large cash positions, but are more likely to be opportunistically
repurchasing their own stock rather than buying other distressed businesses.
Our approach to the Financials sector is also built around a survivor mentality.
In fact, "winner take all" may be a better way of putting it for this industry.
Put simply, there will be fewer but stronger players when this is over. Those
companies that have liquidity are in a position to benefit from the demise of
their peers. Here again, Berkshire Hathaway provides a good example. It and
other well capitalized insurance companies could win business from weakened
competitors. In the banking world, companies such as Bank of America and
JPMorgan that have capital and have purchased assets at distressed prices may
ultimately emerge stronger.
Also, we are not allowing recent events to change our approach toward investing.
We are certainly paying attention to these happenings and their impact on the
Fund's positions, but are attempting to avoid noise and focus primarily on
individual companies that provide solid long-term opportunities. Fundamental
research sometimes feels futile in a fast money world; however, we are confident
it will bear fruit over time. We also remain very mindful of risk. While the
Fund is almost fully invested, we do not have any outsized bets on individual
companies or sectors. As noted in our last letter, we are big believers in the
merits of investing in a diversified portfolio of quality public equities. This
approach may have seemed mundane in a world where more exotic
2
strategies thrived, but its transparency, liquidity and relatively low cost may
become increasingly desirable.
In sum, recent events have been painful for all of us. Our financial system is
going through a restructuring process that may occur at an accelerated pace,
with longer-term implications yet to be fully understood. The good news is that
every collapse pushes the cleansing process closer to an end. Ultimately, we
should in fact have a stronger foundation upon which to build.
THE FUND
The third quarter was a tough period for investors. The Fund had a tough
quarter, but fared a little better than the S&P 500 Index (the Index) returning
- -7.34% versus -8.37%, respectively. During the first two months of the third
quarter, the market managed to stay roughly flat; however, we witnessed steep
declines in September as turmoil in our banking system and credit markets
reached alarming levels. In September alone, the Index was down 8.91%. On a
year-to-date basis, the Index was down 19.29% versus down 18.88% for the Fund at
the end of the quarter.
September was particularly tough and while the decline was clearly bothersome,
we were pleased to avoid some of the market's downside during such a difficult
time. Although we experienced fairly broad based portfolio weakness, we were
able to avoid major collapses within the Financials sector. In fact, the
Financials sector was the biggest relative contributor to performance during the
quarter.
Consumer Staples, where we maintain an overweight position, proved defensive in
a difficult environment and also helped performance. On the other hand, Energy
stocks declined sharply as oil prices fell, but our modest underweight position
in the sector helped performance versus the Index. Technology stocks, which
declined on fears of slowing corporate spending, also hurt performance.
We are more mindful of risk than ever and continue to take steps to upgrade the
quality of our holdings. Put simply, we are dealing with a different world than
we were just a few weeks ago. While credit markets should not remain in panic
mode forever, we believe access to capital will be more difficult (more
expensive at the least) for an extended period of time. In this type of
environment, we are emphasizing companies that we expect will not only survive
but emerge stronger. These are companies that are cash-rich and in a position to
buy assets. Furthermore, we have placed an increased emphasis on companies that
are not as dependent on a cyclical rebound.
Most of our actions during the quarter reflect our ongoing emphasis on quality
and relatively defensive earnings streams. For instance, we established new
positions in Accenture and Automatic Data Processing. Each of these companies is
an industry leader with a large cash position and high level of recurring
revenue. In our opinion, they should be able to weather the storm better than
many companies and should also be able to participate in an improved economic
environment. We also established a new position in Diageo, which is a global
spirits company. It has leading brands, a relatively defensive earnings stream
and an above average dividend yield.
3
We also shifted to more defensive names within select industries. In the Energy
sector, for example, we sold our position in XTO Energy and used part of the
proceeds to increase our exposure to Exxon Mobil. XTO needs capital to execute
its growth plans and is focused almost solely on domestic natural gas
production. Exxon, on the other hand, is a globally diversified energy company
that has a huge cash position and does not need external capital to grow. In
addition, the company has consistently repurchased its shares over time. Within
the Consumer sector, we sold positions in both CarMax and Marriott. In these
cases, earnings estimates appear vulnerable and the companies rely on
securitization markets to fund a least a portion of their businesses. We
purchased a new position in Altria, which has relatively predictable earnings, a
strong balance sheet and the ability to return significant cash to shareholders.
These are clearly unprecedented times in recent history and investors are sure
to find the market's performance unsettling. As evidenced by our remarks, we are
very focused on managing risk and positioning the Fund to perform well in coming
years. As always, thank you for your trust.
NEW POSITIONS
ACCENTURE LTD. (ACN) is a leading management consulting, technology services and
outsourcing company. Through five platforms the company serves a wide array of
companies in multiple industries across the globe. This diversified client base
is augmented by an attractive business model characterized by low capital
intensity, an industry leading low cost labor mix, and a high percentage of
recurring revenues (40%). Moreover, the company has a solid balance sheet and
generates a lot of cash with which it has been buying back stock.
AUTOMATIC DATA PROCESSING, INC. (ADP) provides information systems and
processing services to human resources departments as well as back office
support for auto dealers. The company has a triple-A balance sheet and has
delivered double digit revenue and earnings per share growth over the past few
years. Moreover, 90% of revenue is recurring and the company generates a
significant amount of free cash with which it has consistently paid a dividend
and bought back a meaningful amount of its own shares.
DIAGEO PLC (DEO) is one of the world's leading producers of alcoholic beverages,
with high quality brands such as Smirnoff, Johnnie Walker, Tanqueray and Jose
Quervo. While the stock has been under pressure, the company has remained
operationally resilient, posting high single digit increases in revenue and
operating profit in FY08. Management expects the company to achieve high single
digit sales growth and operating profit growth in the 7-9% range over the next
year. We believe that through investing in its core brands the company will
continue to navigate a difficult economic environment and post solid results.
LABORATORY CORPORATION OF AMERICA HOLDINGS (LH) is the second largest provider
of independent clinical lab services in the United States, holding a 26% share
of the independent clinical market and an 8% share of the total lab market. We
view LH as being part of the solution to enhancing the efficiency and efficacy
of health care services through its value added array of lab service offerings.
Moreover, the company
4
appears to be positioned for above average earnings per share growth of 15%
annually for the next several years.
SPDR S&P BIOTECH INDEX ETF (XBI) has a concentrated portfolio represented by 24
companies with over 30% being larger capitalization firms. The ETF (exchange
traded fund) has representation among instrumentation companies supporting R&D,
specialty pharma organizations, and biologic oriented entities focusing on
genotyping. The ETF has been in existence since February 2006, with annual
returns averaging 11.3% inclusive of dividends. We are attracted to the biotech
industry given revolutionary new treatments, relatively non-cyclical earnings
and lack of exposure to the political and competitive headwinds facing the
pharmaceutical industry.
SUNTRUST BANKS, INC. (STI) is a $177 billion regional bank headquartered in
Atlanta, Georgia. The bank operates extensively in the Mid-Atlantic and
Southeast regions and currently is the largest bank (ranked by deposit share) in
Georgia, the second largest in DC, the third largest in Florida and Tennessee,
and the sixth largest in Virginia, North Carolina and Maryland. While exposed to
some of the troubled areas of the housing market, we believe STI has
aggressively written down its most problematic assets. The stock also pays a
very attractive dividend yielding 5.6%. Increased Positions
CHINA MOBILE LTD. (CHL) is the largest global wireless carrier with over 400
million subscribers. The stock has been pressured as a result of fund flows out
of Chinese equities in addition to uncertainty surrounding industry
restructuring efforts. That said, the company continues to outpace peers, adding
more than 6 million subscribers per month and consistently taking market share.
Moreover, the company's massive scale, operational expertise and robust
financial resources help it to generate twice the profits of its nearest rivals.
EXXON MOBIL CORP. (XOM) is a high quality integrated energy company with
industry leading returns and a massive balance sheet. While production growth on
an absolute basis continues to struggle, we would point out that the company has
grown its production per share at a compound annual growth rate of 3.7% since
the beginning of this decade (leading its peers), made possible by aggressive
buyback activity. Historically, shares of XOM have received a premium to other
integrated oil companies because of its shrewd capital management, willingness
to return cash to shareholders and industry leading returns.
Sincerely,
Joseph L. Antrim, III
President
The Davenport Core Fund
5
THE DAVENPORT CORE FUND
PERFORMANCE INFORMATION (UNAUDITED)
================================================================================
COMPARISON OF THE CHANGE IN VALUE OF A $10,000 INVESTMENT IN
THE DAVENPORT CORE FUND AND THE STANDARD & POOR'S 500 INDEX
[LINE GRAPH OMITTED]
STANDARD & POOR'S 500 INDEX THE DAVENPORT CORE FUND
---------------------------- -------------------------
DATE VALUE DATE VALUE
---- ------ ---- ------
09/30/98 $10,000 09/30/98 $10,000
12/31/98 12,130 12/31/98 11,578
03/31/99 12,734 03/31/99 12,151
06/30/99 13,632 06/30/99 12,773
09/30/99 12,780 09/30/99 11,981
12/31/99 14,682 12/31/99 13,388
03/31/00 15,019 03/31/00 13,965
06/30/00 14,620 06/30/00 13,525
09/30/00 14,478 09/30/00 13,398
12/31/00 13,345 12/31/00 13,293
03/31/01 11,763 03/31/01 11,639
06/30/01 12,452 06/30/01 12,026
09/30/01 10,624 09/30/01 10,792
12/31/01 11,759 12/31/01 11,766
03/31/02 11,791 03/31/02 11,975
06/30/02 10,212 06/30/02 10,968
09/30/02 8,447 09/30/02 9,335
12/31/02 9,160 12/31/02 9,850
03/31/03 8,872 03/31/03 9,501
06/30/03 10,237 06/30/03 10,839
09/30/03 10,508 09/30/03 11,261
12/31/03 11,788 12/31/03 12,334
03/31/04 11,987 03/31/04 12,704
06/30/04 12,194 06/30/04 12,742
09/30/04 11,966 09/30/04 12,542
12/31/04 13,071 12/31/04 13,744
03/31/05 12,790 03/31/05 13,583
06/03/05 12,965 06/03/05 13,604
09/30/05 13,432 09/30/05 14,074
12/31/05 13,713 12/31/05 14,375
03/31/06 14,290 03/31/06 14,870
06/30/06 14,084 06/30/06 14,687
09/30/06 14,882 09/30/06 15,280
12/31/06 15,878 12/31/06 16,240
03/31/07 15,980 03/31/07 16,361
06/30/07 16,983 06/30/07 17,633
09/30/07 17,328 09/30/07 18,562
12/31/07 16,751 12/31/07 18,372
03/31/08 15,169 03/31/08 16,924
06/30/08 14,755 06/30/08 16,083
09/30/08 13,520 09/30/08 14,903
Past performance is not predictive of future performance.
- --------------------------------------------------------------------------------
Average Annual Total Returns(a)
(for periods ended September 30, 2008)
1 YEAR 5 YEARS 10 YEARS
The Davenport Core Fund -19.71% 5.76% 4.07%
Standard & Poor's 500 Index -21.98% 5.17% 3.06%
- --------------------------------------------------------------------------------
(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.
6
THE DAVENPORT CORE FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SECTOR CONCENTRATION VS. THE STANDARD & POOR'S 500 INDEX
[BAR CHART OMITTED]
S&P 500
The Davenport Core Fund Index
----------------------- -------
Consumer Discretionary 7.5% 8.5%
Consumer Staples 19.1% 12.2%
Energy 11.1% 13.4%
Financials 16.6% 15.8%
Health Care 8.7% 13.1%
Industrials 9.0% 11.1%
Information Technology 15.7% 16.0%
Materials 3.5% 3.4%
Telecommunication Services 2.3% 3.0%
Utilities 0.0% 3.5%
Exchange-Traded Funds 1.5% 0.0%
Cash Equivalents 5.0% 0.0%
TOP TEN EQUITY HOLDINGS
% OF
SECURITY DESCRIPTION NET ASSETS
- -------------------- ----------
Exxon Mobil Corporation 3.4%
Berkshire Hathaway, Inc. - Class B 2.9%
General Electric Company 2.7%
Colgate-Palmolive Company 2.7%
Markel Corporation 2.4%
PepsiCo, Inc. 2.4%
SYSCO Corporation 2.4%
United Technologies Corporation 2.4%
Johnson & Johnson 2.2%
Chevron Corporation 2.2%
7
THE DAVENPORT CORE FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 93.5% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 7.5%
35,114 Fortune Brands, Inc. ............................. $ 2,014,139
100,673 Lowe's Companies, Inc. ........................... 2,384,944
59,693 Marriott International, Inc. - Class A ........... 1,557,390
54,529 Omnicom Group, Inc. .............................. 2,102,638
72,375 Walt Disney Company (The) ........................ 2,221,189
-------------
10,280,300
-------------
CONSUMER STAPLES -- 19.1%
48,457 Colgate-Palmolive Company ........................ 3,651,235
72,706 CVS Caremark Corporation ......................... 2,447,284
29,900 Diageo plc - ADR ................................. 2,058,914
80,141 Kraft Foods, Inc. ................................ 2,624,618
46,350 PepsiCo, Inc. .................................... 3,303,364
38,418 Procter & Gamble Company (The) ................... 2,677,350
87,784 SABMiller plc - ADR .............................. 1,699,261
106,679 SYSCO Corporation ................................ 3,288,914
66,336 Walgreen Company ................................. 2,053,763
40,897 Wal-Mart Stores, Inc. ............................ 2,449,321
-------------
26,254,024
-------------
ENERGY -- 11.1%
51,638 Cameco Corporation ............................... 1,152,044
36,766 Chevron Corporation .............................. 3,032,460
18,044 EOG Resources, Inc. .............................. 1,614,216
60,194 Exxon Mobil Corporation .......................... 4,674,666
33,949 Schlumberger Ltd. ................................ 2,651,077
20,044 Transocean, Inc. (a) ............................. 2,201,633
-------------
15,326,096
-------------
FINANCIALS -- 16.6%
50,605 Bank of America Corporation ...................... 1,771,175
63,163 BB&T Corporation ................................. 2,387,561
909 Berkshire Hathaway, Inc. - Class B (a) ........... 3,995,055
94,600 Brookfield Asset Management, Inc. ................ 2,595,824
57,512 Capital One Financial Corporation ................ 2,933,112
54,736 JPMorgan Chase & Company ......................... 2,556,171
9,501 Markel Corporation (a) ........................... 3,339,602
36,025 SunTrust Banks, Inc. ............................. 1,620,765
30,632 T. Rowe Price Group, Inc. ........................ 1,645,245
-------------
22,844,510
-------------
HEALTH CARE -- 8.7%
42,962 Allergan, Inc. ................................... 2,212,543
44,590 Johnson & Johnson ................................ 3,089,195
31,675 Laboratory Corporation of America Holdings (a) ... 2,201,413
53,703 Wyeth ............................................ 1,983,789
38,038 Zimmer Holdings, Inc. (a) ........................ 2,455,733
-------------
11,942,673
-------------
8
THE DAVENPORT CORE FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 93.5% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
INDUSTRIALS -- 9.0%
35,744 Danaher Corporation .............................. $ 2,480,634
144,792 General Electric Company ......................... 3,692,196
46,391 United Parcel Service, Inc. - Class B ............ 2,917,530
54,571 United Technologies Corporation .................. 3,277,534
-------------
12,367,894
-------------
INFORMATION TECHNOLOGY -- 15.7%
55,675 Accenture Ltd. - Class A ......................... 2,115,650
13,839 Apple, Inc. (a) .................................. 1,572,941
50,150 Automatic Data Processing, Inc. .................. 2,143,912
107,819 Cisco Systems, Inc. (a) .......................... 2,432,397
3,594 Google, Inc. (a) ................................. 1,439,469
110,711 Intel Corporation ................................ 2,073,617
21,688 International Business Machines Corporation ...... 2,536,628
104,349 Microsoft Corporation ............................ 2,785,075
100,177 Nokia Corporation - ADR .......................... 1,868,301
128,061 Oracle Corporation (a) ........................... 2,600,919
-------------
21,568,909
-------------
MATERIALS -- 3.5%
52,051 Albemarle Corporation ............................ 1,605,253
26,149 Praxair, Inc. .................................... 1,875,929
5,122 Rio Tinto PLC - ADR .............................. 1,277,939
-------------
4,759,121
-------------
TELECOMMUNICATION SERVICES -- 2.3%
32,428 China Mobile Ltd. - ADR .......................... 1,623,994
22,721 Millicom International Cellular S.A. (a) ......... 1,560,251
-------------
3,184,245
-------------
TOTAL COMMON STOCKS (Cost $123,161,774) .......... $ 128,527,772
-------------
================================================================================
SHARES EXCHANGE-TRADED FUNDS -- 1.5% VALUE
- --------------------------------------------------------------------------------
34,650 SPDR S&P Biotech ETF (Cost $2,285,722) ........... $ 2,083,504
-------------
================================================================================
PAR VALUE U.S. TREASURY OBLIGATIONS -- 0.7% VALUE
- --------------------------------------------------------------------------------
$1,000,000 U.S. Treasury Bill, 1.62%,
due 10/23/2008 (Cost $999,016) ................ $ 999,866
-------------
9
THE DAVENPORT CORE FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES MONEY MARKET FUNDS -- 4.4% VALUE
- --------------------------------------------------------------------------------
6,090,223 First American Treasury Obligations Fund -
Class Y, 0.423% (b) (Cost $6,090,223) ......... $ 6,090,223
-------------
TOTAL INVESTMENTS AT VALUE -- 100.1%
(Cost $132,536,735) ........................... $ 137,701,365
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.1%)... (124,760)
-------------
NET ASSETS -- 100.0% ............................. $ 137,576,605
=============
(a) Non-income producing security.
(b) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
ADR - American Depositary Receipt
See accompanying notes to financial statements
10
THE DAVENPORT CORE FUND
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
ASSETS
Investments in securities:
At acquisition cost ........................................ $132,536,735
============
At market value (Note 1) ................................... $137,701,365
Dividends receivable ......................................... 158,567
Receivable for capital shares sold ........................... 50,487
Other assets ................................................. 18,937
------------
TOTAL ASSETS ............................................... 137,929,356
------------
LIABILITIES
Payable for capital shares redeemed .......................... 236,453
Accrued investment advisory fees (Note 3) .................... 96,855
Accrued administration fees (Note 3) ......................... 16,500
Accrued compliance fees (Note 3) ............................. 1,700
Other accrued expenses ....................................... 1,243
------------
TOTAL LIABILITIES .......................................... 352,751
------------
NET ASSETS ...................................................... $137,576,605
============
Net assets consist of:
Paid-in capital ................................................. $130,336,900
Accumulated net investment income ............................... 27,894
Accumulated net realized gains from security transactions ....... 2,047,181
Net unrealized appreciation on investments ...................... 5,164,630
------------
Net assets ...................................................... $137,576,605
============
Shares of beneficial interest outstanding (unlimited number
of shares authorized, no par value) .......................... 11,353,216
------------
Net asset value, offering price and redemption
price per share (Note 1) ..................................... $ 12.12
============
See accompanying notes to financial statements.
11
THE DAVENPORT CORE FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
INVESTMENT INCOME
Dividends (Net of foreign tax of $24,882) ................... $ 1,390,738
Interest .................................................... 4,351
------------
TOTAL INVESTMENT INCOME ................................... 1,395,089
------------
EXPENSES
Investment advisory fees (Note 3) ........................... 584,370
Administration fees (Note 3) ................................ 106,646
Custodian fees .............................................. 11,009
Compliance service fees and expenses ........................ 10,427
Trustees' fees and expenses ................................. 8,147
Professional fees ........................................... 8,096
Registration fees ........................................... 6,510
Postage and supplies ........................................ 5,699
Insurance expense ........................................... 5,636
Printing of shareholder reports ............................. 5,432
Other expenses .............................................. 3,111
------------
TOTAL EXPENSES ............................................ 755,083
------------
NET INVESTMENT INCOME .......................................... 640,006
------------
REALIZED AND UNREALIZED LOSSES ON INVESTMENTS
Net realized losses from security transactions .............. (883,674)
Net change in unrealized
appreciation/depreciation on investments .................. (19,034,050)
------------
NET REALIZED AND UNREALIZED LOSSES ON INVESTMENTS .............. (19,917,724)
------------
NET DECREASE IN NET ASSETS FROM OPERATIONS ..................... $(19,277,718)
============
See accompanying notes to financial statements.
12
THE DAVENPORT CORE FUND
STATEMENTS OF CHANGES IN NET ASSETS
============================================================================================
SIX MONTHS
ENDED YEAR
SEPT. 30, ENDED
2008 MARCH 31,
(UNAUDITED) 2008
- --------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ..................................... $ 640,006 $ 967,807
Net realized gains (losses) from security transactions . (883,674) 13,162,124
Net change in unrealized appreciation/
depreciation on investments .......................... (19,034,050) (8,698,751)
------------- -------------
Net increase (decrease) in net assets from operations ..... (19,277,718) 5,431,180
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ............................. (612,112) (970,615)
From net realized capital gains on security transactions -- (14,895,339)
------------- -------------
Decrease in net assets from distributions to shareholders . (612,112) (15,865,954)
------------- -------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold .............................. 12,627,850 18,325,065
Net asset value of shares issued in
reinvestment of distributions to shareholders ........ 580,064 15,101,443
Payments for shares redeemed ........................... (11,540,033) (18,848,280)
------------- -------------
Net increase in net assets from capital share transactions 1,667,881 14,578,228
------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ................... (18,221,949) 4,143,454
NET ASSETS
Beginning of period .................................... 155,798,554 151,655,100
------------- -------------
End of period .......................................... $ 137,576,605 $ 155,798,554
============= =============
ACCUMULATED NET INVESTMENT INCOME ......................... $ 27,894 $ --
============= =============
CAPITAL SHARE ACTIVITY
Sold ................................................... 904,331 1,201,518
Reinvested ............................................. 44,394 1,005,915
Redeemed ............................................... (865,795) (1,221,802)
------------- -------------
Net increase in shares outstanding ..................... 82,930 985,631
Shares outstanding at beginning of period .............. 11,270,286 10,284,655
------------- -------------
Shares outstanding at end of period .................... 11,353,216 11,270,286
============= =============
See accompanying notes to financial statements.
13
THE DAVENPORT CORE FUND
FINANCIAL HIGHLIGHTS
==================================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- ----------------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPTEMBER 30, YEARS ENDED MARCH 31,
2008 --------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period ........... $ 13.82 $ 14.75 $ 13.99 $ 13.08 $ 12.30 $ 9.23
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income.......................... 0.06 0.10 0.10 0.07 0.07 0.04
Net realized and unrealized gains
(losses) on investments .................... (1.71) 0.53 1.28 1.17 0.78 3.07
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ................. (1.65) 0.63 1.38 1.24 0.85 3.11
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net
investment income .......................... (0.05) (0.10) (0.10) (0.07) (0.07) (0.04)
Distributions from net realized gains ......... -- (1.46) (0.52) (0.26) -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions .............................. (0.05) (1.56) (0.62) (0.33) (0.07) (0.04)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ................. $ 12.12 $ 13.82 $ 14.75 $ 13.99 $ 13.08 $ 12.30
========== ========== ========== ========== ========== ==========
Total return (a) ................................. (11.94)%(b) 3.44% 10.02% 9.48% 6.91% 33.72%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) .............. $ 137,577 $ 155,799 $ 151,655 $ 148,923 $ 138,181 $ 121,769
========== ========== ========== ========== ========== ==========
Ratio of expenses to average net assets .......... 0.97%(c) 0.96% 0.98% 0.98% 0.98% 1.00%
Ratio of net investment income to
average net assets ............................ 0.82%(c) 0.60% 0.67% 0.50% 0.57% 0.35%
Portfolio turnover rate.. ........................ 23%(b) 37% 26% 39% 28% 25%
(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.
14
THE DAVENPORT CORE FUND
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The Davenport Core Fund (formerly 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, as amended. 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. 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.
The Financial Accounting Standards Board's (FASB) Statement of Financial
Accounting Standards (SFAS) No. 157 "Fair Value Measurements" 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. 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.
Various inputs are used in determining the value of the Fund's investments.
These inputs are summarized in the three broad levels listed below:
o Level 1 - quoted prices in active markets for identical securities
o Level 2 - other significant observable inputs
o Level 3 - significant unobservable inputs
15
THE DAVENPORT CORE FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.
The following is a summary of the inputs used to value the Fund's net assets as
of September 30, 2008:
- --------------------------------------------------------------------------------
THE DAVENPORT
VALUATION INPUTS CORE FUND
- --------------------------------------------------------------------------------
Level 1 - Quoted prices ....................................... $ 136,701,499
Level 2 - Other significant observable inputs ................. 999,866
-------------
Total ......................................................... $ 137,701,365
=============
- --------------------------------------------------------------------------------
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.
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.
Dividends and distributions are recorded on the ex-dividend date. The tax
character of distributions paid during the periods ended September 30, 2008 and
March 31, 2008 was as follows:
- --------------------------------------------------------------------------------
ORDINARY LONG-TERM
PERIOD ENDED INCOME CAPITAL GAINS TOTAL
- --------------------------------------------------------------------------------
September 30, 2008 $ 612,112 $ -- $ 612,112
March 31, 2008 $ 2,627,384 $ 13,238,570 $ 15,865,954
- --------------------------------------------------------------------------------
16
THE DAVENPORT CORE FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Estimates -- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities 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, 2008:
- --------------------------------------------------------------------------------
Cost of portfolio investments ................................. $ 132,841,054
=============
Gross unrealized appreciation ................................. $ 17,791,882
Gross unrealized depreciation ................................. (12,931,571)
-------------
Net unrealized appreciation ................................... $ 4,860,311
Accumulated ordinary income ................................... 27,894
Undistributed long-term gains ................................. 3,235,174
Other losses .................................................. (883,674)
-------------
Accumulated earnings .......................................... $ 7,239,705
=============
- --------------------------------------------------------------------------------
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. These "book/tax"
differences are temporary in nature and are primarily due to the tax deferral of
losses on wash sales.
FASB's Interpretation No. 48 (FIN 48) "Accounting for Uncertainty in Income
Taxes" 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. As required by FIN 48, management has analyzed the
Fund's tax positions taken on Federal income tax returns for all open tax years
(tax years ended March 31, 2005 through March 31, 2008) and has concluded that
no provision for income tax is required in the financial statments.
2. INVESTMENT TRANSACTIONS
During the six months ended September 30, 2008, cost of purchases and proceeds
from sales and maturities of investment securities, other than short-term
investments and U.S. government securities, amounted to $33,724,719 and
$34,352,134, respectively.
17
THE DAVENPORT CORE FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
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.
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, subject to a minimum monthly fee of $4,000,
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 Distributor), 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. In addition, the Fund reimburses Ultimus for any out-of-pocket expenses
incurred for providing these services.
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.
18
THE DAVENPORT CORE 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. These ongoing costs, which are deducted from the Fund's gross income,
directly reduce the investment return of the Fund.
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 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 (April 1, 2008
through September 30, 2008).
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, 2008 SEPT. 30, 2008 DURING PERIOD*
- --------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $ 880.60 $4.57
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).
19
THE DAVENPORT CORE 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.
20
================================================================================
THE DAVENPORT CORE 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
Samuel B. Witt III
OFFICERS
Joseph L. Antrim III, President
John P. Ackerly IV, Vice President
================================================================================
DAVENPORT
- ----------------
ASSET MANAGEMENT
Davenport & Company LLC
One James Center
901 East Cary Street
Richmond, VA 23219
Member: NYSE o SIPC
Toll Free: (800) 846-6666
www.investdavenport.com
================================================================================
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, 2008
(UNAUDITED)
Investment Adviser
LOWE, BROCKENBROUGH & COMPANY, INC.
RICHMOND, VIRGINIA
================================================================================
THE JAMESTOWN BALANCED FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% OF NET ASSETS)
- ------------------------------------------------------
[PIE CHART OMITTED]
Equities 61.9%
Fixed Income 34.8%
Cash Equivalents 3.3%
% OF
TEN LARGEST EQUITY HOLDINGS NET ASSETS
- ------------------------------------------------------
Public Service Enterprise Group, Inc. 1.4%
Microsoft Corporation 1.4%
Cisco Systems, Inc. 1.4%
Corning, Inc. 1.3%
General Electric Company 1.2%
Genzyme Corporation 1.2%
Chevron Corporation 1.2%
Express Scripts, Inc. 1.1%
Teva Pharmaceutical Industries Ltd. - ADR 1.1%
Lockheed Martin Corporation 1.1%
EQUITY SECTOR CONCENTRATION VS. THE S&P 500 INDEX (61.9% OF NET ASSETS)
- -----------------------------------------------------------------------
[BAR CHART OMITTED] (% OF EQUITY PORTFOLIO)
THE JAMESTOWN
BALANCED S&P 500
FUND INDEX
--------- -------
Consumer Discretionary 4.6% 8.5%
Consumer Staples 10.9% 12.2%
Energy 12.7% 13.3%
Financials 10.9% 15.8%
Health Care 16.3% 13.1%
Industrials 13.9% 11.1%
Information Technology 20.3% 16.0%
Materials 3.9% 3.4%
Telecommunication Services 1.4% 3.0%
Utilities 2.2% 3.6%
Exchange-Traded Funds 2.9% 0.0%
FIXED-INCOME PORTFOLIO (34.8% OF NET ASSETS)
- ------------------------------------------------------
Average Stated Maturity (Years) 3.66
Average Duration (Years) 3.12
Average Coupon 5.76%
Average Yield to Maturity 4.99%
% OF FIXED
SECTOR BREAKDOWN INCOME PORTFOLIO
- ------------------------------------------------------
U.S. Treasury 14.9%
U.S. Government Agency 22.1%
Mortgage-Backed 17.4%
Corporate 45.6%
------
100.0%
% OF FIXED
CREDIT QUALITY INCOME PORTFOLIO
- ------------------------------------------------------
AAA 54.0%
AA 4.0%
A 34.0%
BBB 8.0%
------
100.0%
1
THE JAMESTOWN EQUITY FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% OF NET ASSETS)
- ------------------------------------------------------
[PIE CHART OMITTED]
Equities 93.2%
Cash Equivalents 6.8%
% OF
TEN LARGEST EQUITY HOLDINGS NET ASSETS
- ------------------------------------------------------
Microsoft Corporation 2.0%
Public Service Enterprise Group, Inc. 2.0%
Cisco Systems, Inc. 1.9%
Corning, Inc. 1.8%
Chevron Corporation 1.7%
Genzyme Corporation 1.7%
Teva Pharmaceutical Industries Ltd. - ADR 1.7%
Express Scripts, Inc. 1.7%
Financial Select Sector SPDR Fund 1.7%
Thermo Fisher Scientific, Inc. 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 4.4% 8.5%
Consumer Staples 10.2% 12.2%
Energy 11.8% 13.3%
Financials 9.8% 15.8%
Health Care 15.0% 13.1%
Industrials 13.5% 11.1%
Information Technology 18.6% 16.0%
Materials 3.6% 3.4%
Telecommunication Services 1.4% 3.0%
Utilities 2.0% 3.6%
Exchange-Traded Funds 2.9% 0.0%
Cash Equivalents 6.8% 0.0%
2
THE JAMESTOWN SELECT FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% OF NET ASSETS)
- ------------------------------------------------------
[PIE CHART OMITTED]
Equities 96.1%
Cash Equivalents 3.9%
% OF
TEN LARGEST EQUITY HOLDINGS NET ASSETS
- ------------------------------------------------------
Financial Select Sector SPDR Fund 2.7%
Thermo Fisher Scientific, Inc. 2.0%
Express Scripts, Inc. 1.9%
Lockheed Martin Corporation 1.8%
Hewlett-Packard Company 1.8%
Oracle Corporation 1.8%
Symantec Corporation 1.8%
Kroger Company (The) 1.8%
Unum Group 1.8%
International Business
Machines Corporation 1.7%
SECTOR CONCENTRATION VS. THE S&P 500 INDEX
- ------------------------------------------------------
[BAR CHART OMITTED] (% OF NET ASSETS)
THE JAMESTOWN
SELECT S&P 500
FUND INDEX
--------- -------
Consumer Discretionary 8.7% 8.5%
Consumer Staples 9.4% 12.2%
Energy 12.8% 13.3%
Financials 9.6% 15.8%
Health Care 11.2% 13.1%
Industrials 13.0% 11.1%
Information Technology 18.3% 16.0%
Materials 4.4% 3.4%
Telecommunication Services 1.5% 3.0%
Utilities 4.5% 3.6%
Exchange-Traded Funds 2.7% 0.0%
Cash Equivalents 3.9% 0.0%
3
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
CHARACTERISTICS
(WEIGHTED AVERAGE)
- ------------------------------------------------------
30-day SEC Yield 3.11%
Tax-Equivalent Yield 4.78%*
Average Maturity (years) 4.3
Average Duration (years) 3.6
Average Quality AA
Number of Issues 41
* Assumes a maximum 35.0% federal tax rate.
MATURITY BREAKDOWN (% OF PORTFOLIO)
- ------------------------------------------------------
[BAR CHART OMITTED]
0-2 Years 13.0%
2-5 Years 29.9%
5-10 Years 42.6%
10+ Years 14.5%
CREDIT QUALITY (% OF PORTFOLIO)
- ------------------------------------------------------
[PIE CHART OMITTED]
AAA 30.0%
AA 65.0%
A 5.0%
SECTOR DIVERSIFICATION (% OF PORTFOLIO)
- ------------------------------------------------------
[PIE CHART OMITTED]
Revenues 60%
General Obligations 27%
Government Guaranteed 13%
4
THE JAMESTOWN INTERNATIONAL EQUITY FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
ASSET ALLOCATION (% OF NET ASSETS)
- ------------------------------------------------------
[PIE CHART OMITTED]
Equities 97.5%
Other 2.5%
% OF
TEN LARGEST HOLDINGS COUNTRY NET ASSETS
- ------------------------------------------------------
SAP AG Germany 4.3%
Koninklijke (Royal)
KPN NV Netherlands 2.6%
Repsol YPF SA Spain 2.5%
Mitsubishi Estate
Company Ltd. Japan 2.4%
GDF Suez France 2.3%
GlaxoSmithKline PLC United Kingdom 2.1%
Siemens AG Germany 1.9%
ENI SpA Italy 1.9%
Royal Dutch Shell
PLC - Class A United Kingdom 1.8%
DBS Group Holdings Ltd. Singapore 1.8%
GEOGRAPHIC DIVERSIFICATION VS. THE MORGAN STANLEY EAFE INDEX
- ------------------------------------------------------------
[BAR CHART OMITTED] (% OF NET ASSETS)
THE JAMESTOWN MORGAN
INTERNATIONAL STANLEY
EQUITY EAFE
FUND INDEX
- -------------------------------------------------------------
Australia 0.0% 6.32%
Belgium 0.8% 0.90%
Denmark 1.1% 0.96%
Finland 1.2% 1.41%
France 12.6% 11.00%
Germany 13.6% 9.02%
Greece 0.9% 0.65%
Hong Kong 0.4% 2.08%
Italy 4.4% 3.73%
Japan 28.5% 22.14%
Netherlands 4.6% 2.55%
Norway 1.1% 0.86%
Portugal 0.5% 0.30%
Singapore 2.2% 1.17%
South Korea 0.9% 0.00%
Spain 3.7% 4.26%
Sweden 1.9% 2.13%
Switzerland 4.8% 7.86%
United Kingdom 14.3% 21.67%
Cash Equivalents 2.5% 0.00%
5
THE JAMESTOWN BALANCED FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 60.1% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 2.9%
6,400 GameStop Corporation - Class A (a) ................ $ 218,944
3,200 Johnson Controls, Inc. ............................ 97,056
4,750 McDonald's Corporation ............................ 293,075
6,500 Walt Disney Company (The) ......................... 199,485
------------
808,560
------------
CONSUMER STAPLES -- 6.7%
6,200 Avon Products, Inc. ............................... 257,734
4,800 Coca-Cola Company (The) ........................... 253,824
12,100 Constellation Brands, Inc. - Class A (a) .......... 259,666
8,300 CVS Caremark Corporation .......................... 279,378
9,400 Kroger Company (The) .............................. 258,312
4,200 PepsiCo, Inc. ..................................... 299,334
4,300 Procter & Gamble Company (The) .................... 299,667
------------
1,907,915
------------
ENERGY -- 7.8%
2,300 Apache Corporation ................................ 239,844
4,000 Chevron Corporation ............................... 329,920
3,000 ConocoPhillips .................................... 219,750
3,000 Exxon Mobil Corporation ........................... 232,980
3,500 National Oilwell Varco, Inc. (a) .................. 175,805
5,800 Noble Corporation ................................. 254,620
3,800 Occidental Petroleum Corporation .................. 267,710
3,350 Schlumberger Ltd. ................................. 261,602
2,150 Transocean, Inc. (a) .............................. 236,156
------------
2,218,387
------------
FINANCIALS -- 6.7%
4,600 AFLAC, Inc. ....................................... 270,250
5,500 Assurant, Inc. .................................... 302,500
5,150 Bank of America Corporation ....................... 180,250
2,500 Northern Trust Corporation ........................ 180,500
3,400 Prudential Financial, Inc. ........................ 244,800
3,000 State Street Corporation .......................... 170,640
6,000 Travelers Companies, Inc. (The) ................... 271,200
11,500 Unum Group ........................................ 288,650
------------
1,908,790
------------
HEALTH CARE -- 10.1%
4,500 Abbott Laboratories ............................... 259,110
2,500 Aetna, Inc. ....................................... 90,275
12,500 Bristol-Myers Squibb Company ...................... 260,625
4,400 Express Scripts, Inc. (a) ......................... 324,808
4,100 Genzyme Corporation (a) ........................... 331,649
6,500 Gilead Sciences, Inc. (a) ......................... 296,270
4,300 Johnson & Johnson ................................. 297,904
4,850 McKesson Corporation .............................. 260,978
7,000 Teva Pharmaceutical Industries Ltd. - ADR ......... 320,530
5,550 Thermo Fisher Scientific, Inc. (a) ................ 305,250
2,200 WellPoint, Inc. (a) ............................... 102,894
------------
2,850,293
------------
6
THE JAMESTOWN BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 60.1% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
INDUSTRIALS -- 8.6%
2,900 Cummins, Inc. ..................................... $ 126,788
6,100 Dover Corporation ................................. 247,355
3,000 General Dynamics Corporation ...................... 220,860
13,100 General Electric Company .......................... 334,050
4,900 ITT Corporation ................................... 272,489
2,800 Lockheed Martin Corporation ....................... 307,076
4,000 Norfolk Southern Corporation ...................... 264,840
3,500 Northrop Grumman Corporation ...................... 211,890
6,700 Textron, Inc. ..................................... 196,176
4,100 United Technologies Corporation ................... 246,246
------------
2,427,770
------------
INFORMATION TECHNOLOGY -- 12.6%
7,000 Accenture Ltd. - Class A .......................... 266,000
17,000 Cisco Systems, Inc. (a) ........................... 383,520
23,000 Corning, Inc. ..................................... 359,720
500 Google, Inc. - Class A (a) ........................ 200,260
5,100 Harris Corporation ................................ 235,620
5,800 Hewlett-Packard Company ........................... 268,192
9,300 Intel Corporation ................................. 174,189
2,500 International Business Machines Corporation ....... 292,400
6,000 MEMC Electronic Materials, Inc. (a) ............... 169,560
14,500 Microsoft Corporation ............................. 387,005
13,000 Oracle Corporation (a) ............................ 264,030
6,800 QUALCOMM, Inc. .................................... 292,196
14,000 Symantec Corporation (a) .......................... 274,120
------------
3,566,812
------------
MATERIALS -- 2.4%
2,700 CF Industries Holdings, Inc. ...................... 246,942
6,500 Nucor Corporation ................................. 256,750
2,600 Praxair, Inc. ..................................... 186,524
------------
690,216
------------
TELECOMMUNICATION SERVICES -- 0.9%
9,000 AT&T, Inc. ........................................ 251,280
------------
UTILITIES -- 1.4%
12,000 Public Service Enterprise Group, Inc. ............. 393,480
------------
TOTAL COMMON STOCKS (Cost $14,236,640) ............ $ 17,023,503
------------
7
THE JAMESTOWN BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES EXCHANGE-TRADED FUNDS -- 1.8% VALUE
- --------------------------------------------------------------------------------
8,100 Consumer Discretionary Select Sector SPDR Fund .... $ 228,582
14,000 Financial Select Sector SPDR Fund ................. 277,060
------------
TOTAL EXCHANGE-TRADED FUNDS (Cost $555,736) ....... $ 505,642
------------
================================================================================
PAR VALUE U.S. TREASURY OBLIGATIONS -- 5.2% VALUE
- --------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 5.2%
$ 250,000 4.00%, due 02/15/2014 ............................. $ 262,754
750,000 4.25%, due 11/15/2014 ............................. 798,223
400,000 4.25%, due 11/15/2017 ............................. 414,562
------------
TOTAL U.S. TREASURY OBLIGATIONS (Cost $1,406,254) . $ 1,475,539
------------
================================================================================
PAR VALUE U.S. GOVERNMENT AGENCY OBLIGATIONS -- 7.7% VALUE
- --------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 6.0%
$1,000,000 6.625%, due 09/15/2009 ............................ $ 1,032,391
150,000 5.125%, due 07/15/2012 ............................ 156,907
500,000 5.25%, due 04/18/2016 ............................. 521,853
------------
1,711,151
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -- 1.7%
250,000 7.25%, due 01/15/2010 ............................. 262,792
200,000 5.50%, due 03/15/2011 ............................. 210,603
------------
473,395
------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $2,094,848) ............................... $ 2,184,546
------------
================================================================================
PAR VALUE MORTGAGE-BACKED SECURITIES -- 6.0% VALUE
- --------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 1.3%
$ 22,529 Pool #E90624, 6.00%, due 08/01/2017 ............... $ 22,941
362,853 Pool #A43942, 5.50%, due 03/01/2036 ............... 361,271
------------
384,212
------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION -- 4.6%
179,971 Pool #618465, 5.00%, due 12/01/2016 ............... 178,876
246,045 Pool #684231, 5.00%, due 01/01/2018 ............... 244,548
239,262 Pool #255455, 5.00%, due 10/01/2024 ............... 235,316
391,858 Pool #255702, 5.00%, due 05/01/2025 ............... 385,043
249,568 Pool #808413, 5.50%, due 01/01/2035 ............... 249,064
------------
1,292,847
------------
GOVERNMENT NATIONAL MORTAGE ASSOCIATION -- 0.1%
36,212 Pool #781344, 6.50%, due 10/01/2031 ............... 37,127
------------
TOTAL MORTGAGE-BACKED SECURITIES (Cost $1,722,345) $ 1,714,186
------------
8
THE JAMESTOWN BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
PAR VALUE CORPORATE BONDS -- 15.9% VALUE
- --------------------------------------------------------------------------------
Alcoa, Inc.,
$ 250,000 6.50%, due 06/01/2011 ........................... $ 255,241
American Express Company,
150,000 4.875%, due 07/15/2013 .......................... 133,909
AT&T, Inc.,
250,000 4.95%, due 01/15/2013 ........................... 239,500
BB&T Corporation,
325,000 6.50%, due 08/01/2011 ........................... 316,997
Burlington Resources, Inc.,
350,000 6.68%, due 02/15/2011 ........................... 364,390
Deutsche Telekom AG,
300,000 8.00%, due 06/15/2010 ........................... 311,424
Dover Corporation,
345,000 6.50%, due 02/15/2011 ........................... 363,891
FPL Group Capital, Inc.,
300,000 7.375%, due 06/01/2009 .......................... 307,404
GlaxoSmithKline PLC,
200,000 5.65%, due 5/15/2018 ............................ 189,884
Goldman Sachs Group, Inc.,
350,000 6.65%, due 05/15/2009 ........................... 342,931
GTE Northwest, Inc.,
300,000 6.30%, due 06/01/2010 ........................... 303,192
International Business Machines Corporation,
175,000 4.375%, due 06/01/2009 .......................... 175,734
JPMorgan Chase & Company,
300,000 6.75%, due 02/01/2011 ........................... 301,004
May Department Stores Company,
260,000 5.95%, due 11/01/2008 ........................... 259,594
Morgan Stanley,
250,000 5.30%, due 03/01/2013 ........................... 171,700
PepsiCo, Inc.,
200,000 4.65%, due 02/15/2013 ........................... 202,989
United Technologies Corporation,
250,000 6.10%, due 05/15/2012 ........................... 258,751
------------
TOTAL CORPORATE BONDS (Cost $4,572,927) ........... $ 4,498,535
------------
================================================================================
SHARES MONEY MARKET FUNDS -- 1.9% VALUE
- --------------------------------------------------------------------------------
527,630 Fidelity Institutional Money Market Portfolio,
2.854% (b) (Cost $527,630) ...................... $ 527,630
------------
TOTAL INVESTMENTS AT VALUE -- 98.6%
(Cost $25,116,380) .............................. $ 27,929,581
OTHER ASSETS IN EXCESS OF LIABILITIES -- 1.4% ..... 384,974
------------
NET ASSETS -- 100.0% .............................. $ 28,314,555
============
(a) Non-income producing security.
(b) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
ADR - American Depositary Receipt.
See accompanying notes to financial statements.
9
THE JAMESTOWN EQUITY FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 90.3% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 4.4%
10,100 GameStop Corporation - Class A (a) ................ $ 345,521
5,300 Johnson Controls, Inc. ............................ 160,749
6,800 McDonald's Corporation ............................ 419,560
10,400 Walt Disney Company (The) ......................... 319,176
------------
1,245,006
------------
CONSUMER STAPLES -- 10.2%
9,400 Avon Products, Inc. ............................... 390,758
7,400 Coca-Cola Company (The) ........................... 391,312
18,000 Constellation Brands, Inc. - Class A (a) .......... 386,280
12,500 CVS Caremark Corporation .......................... 420,750
14,000 Kroger Company (The) .............................. 384,720
6,400 PepsiCo, Inc. ..................................... 456,128
6,600 Procter & Gamble Company (The) .................... 459,954
------------
2,889,902
------------
ENERGY -- 11.8%
3,600 Apache Corporation ................................ 375,408
6,000 Chevron Corporation ............................... 494,880
4,350 ConocoPhillips .................................... 318,638
4,500 Exxon Mobil Corporation ........................... 349,470
5,500 National Oilwell Varco, Inc. (a) .................. 276,265
8,500 Noble Corporation ................................. 373,150
5,700 Occidental Petroleum Corporation .................. 401,565
5,000 Schlumberger Ltd. ................................. 390,450
3,600 Transocean, Inc. (a) .............................. 395,424
------------
3,375,250
------------
FINANCIALS -- 9.8%
6,850 AFLAC, Inc. ....................................... 402,437
8,000 Assurant, Inc. .................................... 440,000
11,000 Hudson City Bancorp, Inc. ......................... 202,950
3,950 Northern Trust Corporation ........................ 285,190
5,200 Prudential Financial, Inc. ........................ 374,400
4,500 State Street Corporation .......................... 255,960
8,900 Travelers Companies, Inc. (The) ................... 402,280
17,000 Unum Group ........................................ 426,700
------------
2,789,917
------------
HEALTH CARE -- 15.0%
6,900 Abbott Laboratories ............................... 397,302
3,950 Aetna, Inc. ....................................... 142,635
18,500 Bristol-Myers Squibb Company ...................... 385,725
6,500 Express Scripts, Inc. (a) ......................... 479,830
6,000 Genzyme Corporation (a) ........................... 485,340
9,800 Gilead Sciences, Inc. (a) ......................... 446,684
6,450 Johnson & Johnson ................................. 446,856
7,350 McKesson Corporation .............................. 395,503
10,500 Teva Pharmaceutical Industries Ltd. - ADR ......... 480,795
8,500 Thermo Fisher Scientific, Inc. (a) ................ 467,500
3,250 WellPoint, Inc. (a) ............................... 152,003
------------
4,280,173
------------
10
THE JAMESTOWN EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 90.3% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
INDUSTRIALS -- 13.5%
6,700 Cummins, Inc. ..................................... $ 292,924
9,050 Dover Corporation ................................. 366,978
4,600 General Dynamics Corporation ...................... 338,652
14,000 General Electric Company .......................... 357,000
7,300 ITT Corporation ................................... 405,953
4,100 Lockheed Martin Corporation ....................... 449,647
6,100 Norfolk Southern Corporation ...................... 403,881
5,700 Northrop Grumman Corporation ...................... 345,078
4,000 Parker-Hannifin Corporation ....................... 212,000
10,100 Textron, Inc. ..................................... 295,728
6,200 United Technologies Corporation ................... 372,372
------------
3,840,213
------------
INFORMATION TECHNOLOGY -- 18.6%
10,400 Accenture Ltd. - Class A .......................... 395,200
24,100 Cisco Systems, Inc. (a) ........................... 543,696
32,000 Corning, Inc. ..................................... 500,480
800 Google, Inc. - Class A (a) ........................ 320,416
8,000 Harris Corporation ................................ 369,600
8,800 Hewlett-Packard Company ........................... 406,912
15,000 Intel Corporation ................................. 280,950
3,650 International Business Machines Corporation ....... 426,904
8,250 MEMC Electronic Materials, Inc. (a) ............... 233,145
21,800 Microsoft Corporation ............................. 581,842
20,500 Oracle Corporation (a) ............................ 416,355
10,000 QUALCOMM, Inc. .................................... 429,700
20,250 Symantec Corporation (a) .......................... 396,495
------------
5,301,695
------------
MATERIALS -- 3.6%
4,290 CF Industries Holdings, Inc. ...................... 392,363
9,300 Nucor Corporation ................................. 367,350
3,850 Praxair, Inc. ..................................... 276,199
------------
1,035,912
------------
TELECOMMUNICATION SERVICES -- 1.4%
13,700 AT&T, Inc. ........................................ 382,504
------------
UTILITIES -- 2.0%
17,500 Public Service Enterprise Group, Inc. ............. 573,825
------------
TOTAL COMMON STOCKS (Cost $22,204,419) ............ $ 25,714,397
------------
11
THE JAMESTOWN EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES EXCHANGE-TRADED FUNDS -- 2.9% VALUE
- --------------------------------------------------------------------------------
12,900 Consumer Discretionary Select Sector SPDR Fund .... $ 364,038
24,000 Financial Select Sector SPDR Fund ................. 474,960
------------
TOTAL EXCHANGE-TRADED FUNDS (Cost $916,356) ....... $ 838,998
------------
================================================================================
SHARES MONEY MARKET FUNDS -- 1.9% VALUE
- --------------------------------------------------------------------------------
537,231 Fidelity Institutional Money Market Portfolio,
2.854% (b) (Cost $537,231) ...................... $ 537,231
------------
================================================================================
FACE
AMOUNT REPURCHASE AGREEMENTS (c) -- 4.4% VALUE
- --------------------------------------------------------------------------------
$1,254,591 U.S. Bank N.A., 0.50%, dated 09/30/2008, due
10/01/2008, repurchase proceeds: $1,254,608
(Cost $1,254,591) ............................... $ 1,254,591
------------
TOTAL INVESTMENTS AT VALUE -- 99.5%
(Cost $24,912,597) .............................. $ 28,345,217
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.5% ..... 138,439
------------
NET ASSETS -- 100.0% .............................. $ 28,483,656
============
(a) Non-income producing security.
(b) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
(c) Repurchase agreement is fully collateralized by $1,254,591 FGCI Pool
#E01424, 4.00%, due 08/01/2018. The aggregate market value of the
collateral at September 30, 2008 was $1,279,773.
ADR - American Depositary Receipt.
See accompanying notes to financial statements.
12
THE JAMESTOWN SELECT FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 93.4% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 8.7%
7,400 GameStop Corporation - Class A (a) ................ $ 253,154
15,500 Limited Brands, Inc. .............................. 268,460
5,630 McDonald's Corporation ............................ 347,371
6,100 Snap-on, Inc. ..................................... 321,226
11,000 TJX Companies, Inc. (The) ......................... 335,720
8,960 Walt Disney Company (The) ......................... 274,982
------------
1,800,913
------------
CONSUMER STAPLES -- 9.4%
7,350 Avon Products, Inc. ............................... 305,539
15,200 Constellation Brands, Inc. - Class A (a) .......... 326,192
9,370 CVS Caremark Corporation .......................... 315,394
13,350 Kroger Company (The) .............................. 366,858
21,200 Sara Lee Corporation .............................. 267,756
5,900 Wal-Mart Stores, Inc. ............................. 353,351
------------
1,935,090
------------
ENERGY -- 12.8%
3,250 Apache Corporation ................................ 338,910
3,550 Chevron Corporation ............................... 292,804
4,070 ConocoPhillips .................................... 298,128
4,000 Murphy Oil Corporation ............................ 256,560
5,250 National Oilwell Varco, Inc. (a) .................. 263,707
6,530 Noble Corporation ................................. 286,667
4,650 Occidental Petroleum Corporation .................. 327,593
8,200 Plains Exploration & Production Company (a) ....... 288,312
2,590 Transocean, Inc. (a) .............................. 284,486
------------
2,637,167
------------
FINANCIALS -- 9.6%
5,180 Assurant, Inc. .................................... 284,900
13,650 Charles Schwab Corporation (The) .................. 354,900
17,500 Hudson City Bancorp, Inc. ......................... 322,875
4,460 Northern Trust Corporation ........................ 322,012
5,330 Torchmark Corporation ............................. 318,734
14,420 Unum Group ........................................ 361,942
------------
1,965,363
------------
HEALTH CARE -- 11.2%
7,925 Aetna, Inc. ....................................... 286,172
12,170 Bristol-Myers Squibb Company ...................... 253,745
5,440 Express Scripts, Inc. (a) ......................... 401,581
3,950 Genzyme Corporation (a) ........................... 319,516
4,350 Johnson & Johnson ................................. 301,368
6,260 McKesson Corporation .............................. 336,850
7,425 Thermo Fisher Scientific, Inc. (a) ................ 408,375
------------
2,307,607
------------
13
THE JAMESTOWN SELECT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 93.4% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
INDUSTRIALS -- 13.0%
24,900 Allied Waste Industries, Inc. (a) ................. $ 276,639
6,900 Cooper Industries Ltd. - Class A .................. 275,655
4,400 Cummins, Inc. ..................................... 192,368
7,080 Emerson Electric Company .......................... 288,793
4,170 General Dynamics Corporation ...................... 306,995
5,540 Goodrich Corporation .............................. 230,464
3,450 Lockheed Martin Corporation ....................... 378,361
4,270 Northrop Grumman Corporation ...................... 258,506
5,442 Parker Hannifin Corporation ....................... 288,426
6,150 Textron, Inc. ..................................... 180,072
------------
2,676,279
------------
INFORMATION TECHNOLOGY -- 18.3%
9,210 Accenture Ltd. - Class A .......................... 349,980
11,900 Broadcom Corporation - Class A (a) ................ 221,697
13,500 Corning, Inc. ..................................... 211,140
6,710 Harris Corporation ................................ 310,002
8,140 Hewlett-Packard Company ........................... 376,394
3,080 International Business Machines Corporation ....... 360,237
44,600 LSI Logic Corporation (a) ......................... 239,056
9,570 Microsoft Corporation ............................. 255,423
18,215 Oracle Corporation (a) ............................ 369,947
16,900 QLogic Corporation (a) ............................ 259,584
18,860 Symantec Corporation (a) .......................... 369,278
8,600 Tyco Electronics Ltd. ............................. 237,876
18,170 Xerox Corporation ................................. 209,500
------------
3,770,114
------------
MATERIALS -- 4.4%
3,120 CF Industries Holdings, Inc. ...................... 285,355
4,700 FMC Corporation ................................... 241,533
5,400 Nucor Corporation ................................. 213,300
9,700 Steel Dynamics, Inc. .............................. 165,773
------------
905,961
------------
TELECOMMUNICATION SERVICES -- 1.5%
7,600 Embarq Corporation ................................ 308,180
------------
UTILITIES -- 4.5%
23,400 CMS Energy Corporation ............................ 291,798
12,100 MDU Resources Group, Inc. ......................... 350,900
12,700 Pepco Holdings, Inc. .............................. 290,957
------------
933,655
------------
TOTAL COMMON STOCKS (Cost $20,776,899) ............ $ 19,240,329
------------
14
THE JAMESTOWN SELECT FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES EXCHANGE-TRADED FUNDS -- 2.7% VALUE
- --------------------------------------------------------------------------------
27,900 Financial Select Sector SPDR Fund (Cost $674,874) . $ 552,141
------------
================================================================================
SHARES MONEY MARKET FUNDS -- 4.2% VALUE
- --------------------------------------------------------------------------------
871,565 Fidelity Institutional Money Market Portfolio,
2.854% (b) (Cost $871,565) ...................... $ 871,565
------------
TOTAL INVESTMENTS AT VALUE -- 100.3%
(Cost $22,323,338) .............................. $ 20,664,035
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.3%) ... (52,987)
------------
NET ASSETS -- 100.0% .............................. $ 20,611,048
============
(a) Non-income producing security.
(b) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
See accompanying notes to financial statements.
15
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
============================================================================================================
VIRGINIA REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 94.2% VALUE
- ------------------------------------------------------------------------------------------------------------
Alexandria, Virginia, GO,
$1,000,000 5.00%, due 06/15/2011, prerefunded 06/15/2010 @ 101 .......................... $ 1,050,740
Arlington Co., Virginia, GO,
500,000 4.10%, due 11/01/2018 ........................................................ 491,150
Capital Region Airport Commission, Virginia, Airport Revenue,
520,000 4.50%, due 07/01/2016 ........................................................ 527,452
Chesterfield Co., Virginia, GO,
700,000 5.00%, due 01/01/2020 ........................................................ 718,032
Fairfax Co., Virginia, Economic Dev. Authority, Revenue,
1,000,000 5.00%, due 06/01/2018 ........................................................ 1,027,890
Fairfax Co., Virginia, GO,
700,000 5.00%, due 10/01/2011 ........................................................ 740,950
Fauquier Co., Virginia, GO,
500,000 5.00%, due 07/01/2017 ........................................................ 527,220
Hampton, Virginia, GO,
1,000,000 5.50%, due 02/01/2012, prerefunded 02/01/2010 @ 102 .......................... 1,059,080
500,000 5.00%, due 04/01/2020 ........................................................ 504,695
Hanover Co., Virginia, GO,
1,000,000 5.125%, due 07/15/2013, prerefunded 07/15/2009 @ 101 ......................... 1,032,160
Hanover Co., Virginia, Industrial Dev. Authority, Revenue,
1,000,000 6.50%, due 08/15/2009 ........................................................ 1,032,650
Henrico Co., Virginia, Economic Dev. Authority, Revenue,
1,000,000 5.50%, due 11/01/2008 ........................................................ 1,002,580
James City, Virginia, School District, GO,
500,000 5.00%, due 12/15/2018 ........................................................ 514,900
James City, Virginia, Service Authority, Water and Sewer, Revenue,
1,000,000 5.125%, due 01/15/2017 ....................................................... 1,040,920
Leesburg, Virginia, GO,
500,000 5.00%, due 09/15/2016 ........................................................ 533,890
Loudoun Co., Virginia, GO,
500,000 5.00%, due 07/01/2012 ........................................................ 532,475
Loudoun Co., Virginia, Industrial Dev. Authority, Public Facility Lease, Revenue,
1,000,000 5.00%, due 03/01/2019 ........................................................ 1,013,800
Lynchburg, Virginia, GO,
500,000 5.00%, due 06/01/2015 ........................................................ 535,545
Medical College of Virginia, Hospitals Authority, Revenue,
700,000 5.00%, due 07/01/2013 ........................................................ 714,798
New Kent Co., Virginia, Economic Dev. Authority, Revenue,
500,000 5.00%, due 02/01/2019 ........................................................ 502,165
New River Valley Regional Jail Authority, Revenue,
250,000 4.00%, due 04/01/2011 ........................................................ 251,050
Norfolk, Virginia, GO,
500,000 4.50%, due 06/01/2015 ........................................................ 512,980
Norfolk, Virginia, Water, Revenue,
1,000,000 5.00%, due 11/01/2016 ........................................................ 1,015,740
Portsmouth, Virginia, GO,
500,000 5.00%, due 04/01/2016 ........................................................ 527,355
290,000 5.00%, due 08/01/2017 ........................................................ 291,778
16
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
============================================================================================================
VIRGINIA REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 94.2% (CONTINUED) VALUE
- ------------------------------------------------------------------------------------------------------------
Richmond, Virginia, Industrial Dev. Authority, Government Facilities, Revenue,
$ 510,000 4.75%, due 07/15/2010 ........................................................ $ 523,520
Richmond, Virginia, Metropolitan Authority, Revenue,
1,000,000 5.25%, due 07/15/2014 ........................................................ 1,044,900
Southeastern Public Service Authority, Virginia, Revenue,
1,000,000 5.00%, due 07/01/2015 ........................................................ 1,019,260
Spotsylvania Co., Virginia, GO,
500,000 5.00%, due 01/15/2016 ........................................................ 522,100
University of Virginia, Revenue,
1,000,000 5.25%, due 06/01/2012 ........................................................ 1,024,900
585,000 5.00%, due 06/01/2013 ........................................................ 625,283
Upper Occoquan, Virginia, Sewer Authority, Revenue,
250,000 5.15%, due 07/01/2020 ........................................................ 254,195
Virginia College Building Authority, Educational Facilities, Revenue,
500,000 5.00%, due 02/01/2017 ........................................................ 510,690
500,000 5.00%, due 04/01/2017 ........................................................ 509,780
Virginia Commonwealth Transportation Board, Federal Highway Reimbursement
Anticipation Note, Revenue,
500,000 5.00%, due 09/28/2015 ........................................................ 534,680
Virginia Polytechnic Institute & State University, Revenue,
500,000 5.00%, due 06/01/2016 ........................................................ 529,680
Virginia State, GO,
500,000 5.00%, due 06/01/2012 ........................................................ 532,030
Virginia State Public Building Authority, Revenue,
635,000 5.00%, due 08/01/2012 ........................................................ 673,760
Virginia State Public School Authority, Revenue,
995,000 5.25%, due 08/01/2009 ........................................................ 1,020,313
Virginia State Resource Authority, Infrastructure Revenue,
400,000 5.50%, due 05/01/2017, prerefunded 05/01/2010 @ 101 .......................... 422,344
100,000 5.50%, due 05/01/2017 ........................................................ 103,867
------------
TOTAL VIRGINIA REVENUE AND GENERAL OBLIGATION (GO) BONDS
(Cost $27,714,382) ........................................................... $ 27,553,297
------------
================================================================================
SHARES MONEY MARKET FUNDS -- 4.6% VALUE
- --------------------------------------------------------------------------------
1,360,319 Fidelity Institutional Tax-Exempt Portfolio,
4.914% (a) (Cost $1,360,319) .................... $ 1,360,319
------------
TOTAL INVESTMENTS AT VALUE -- 98.8%
(Cost $29,074,701) .............................. $ 28,913,616
OTHER ASSETS IN EXCESS OF LIABILITIES -- 1.2% ..... 347,335
------------
NET ASSETS -- 100.0% .............................. $ 29,260,951
============
(a) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
See accompanying notes to financial statements.
17
THE JAMESTOWN INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 97.5% VALUE
- --------------------------------------------------------------------------------
BELGIUM -- 0.8%
3,148 UCB SA (b) ........................................ $ 111,596
------------
DENMARK -- 1.1%
3,091 Novo Nordisk A/S - Class B (b) .................... 159,889
------------
FINLAND -- 1.2%
2,751 Nokia Corporation - ADR ........................... 51,306
6,386 Nokia Corporation (b) ............................. 118,842
------------
170,148
------------
FRANCE -- 12.6%
877 Air Liquide SA (b) ................................ 96,855
11,656 Alcatel SA (b) .................................... 44,818
2,114 Cap Gemini SA (b) ................................. 99,644
2,957 Carrefour SA (b) .................................. 139,131
988 Casino Guichard-Perrachon SA (b) .................. 87,962
2,010 Compagnie de Saint-Gobain (b) .................... 103,742
2,982 France Telecom SA (b) ............................. 83,457
6,153 GDF Suez (b) ...................................... 319,402
1,407 Groupe DANONE (b) ................................. 99,578
1,128 PPR SA (b) ........................................ 100,705
1,501 Sanofi-Aventis (b) ................................ 98,463
965 Schneider Electric SA (b) ......................... 82,684
1,613 Suez SA (a) ....................................... 39,627
3,322 Total SA (b) ...................................... 201,360
1,532 Veolia Environnement (b) .......................... 62,887
3,713 Vivendi Universal SA (b) .......................... 116,145
------------
1,776,460
------------
GERMANY -- 13.6%
1,235 Allianz AG (b) .................................... 169,780
2,729 Arcandor AG (a) ................................... 9,008
2,902 Bayer AG (b) ...................................... 212,550
2,877 Deustche Bank AG (b) .............................. 208,440
2,911 Deustche Postbank AG (b) .......................... 113,199
3,702 Infineon Technologies AG (a) (b) .................. 20,717
671 Merck KGaA (b) .................................... 71,398
1,832 Metro AG (b) ...................................... 91,688
982 Muencher Rueckversicherungs-Gesellschaft AG (b) ... 148,272
11,312 SAP AG (b) ........................................ 600,640
2,927 Siemens AG (b) .................................... 274,690
------------
1,920,382
------------
GREECE -- 0.9%
6,752 Hellenic Telecommunications Organization SA (b) ... 121,096
------------
HONG KONG -- 0.4%
16,400 Bank of East Asia Ltd. (The) (b) .................. 51,628
------------
18
THE JAMESTOWN INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 97.5% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
ITALY -- 4.4%
4,699 Assicurazioni Generali SpA (b) .................... $ 155,644
16,675 Enel SpA (b) ...................................... 138,886
9,979 ENI SpA (b) ....................................... 263,913
15,256 UniCredito Italiano SpA (b) ....................... 56,920
------------
615,363
------------
JAPAN -- 28.5%
24,000 Bank of Yokohama Ltd. (b) ......................... 119,095
6,000 Bridgestone Corporation (b) ....................... 113,792
2,950 Canon, Inc. (b) ................................... 112,037
13,000 Daiwa Securities Group, Inc. (b) .................. 94,858
31 East Japan Railway Company (b) .................... 231,600
2,200 FANUC LTD. (b) .................................... 165,806
2,300 FAST RETAILING COMPANY Ltd. (b) ................... 234,959
5,500 JSR Corporation (b) ............................... 73,477
1,150 KEYENCE CORPORATION (b) ........................... 229,816
5,800 MARUI COMPANY LTD. (b) ............................ 43,391
17,000 Mitsubishi Estate Company Ltd. (b) ................ 335,587
28,300 Mitsubishi UFJ Financial Group, Inc. (b) .......... 247,225
13,300 Nomura Holdings, Inc. (b) ......................... 173,877
50 NTT Data Corporation (b) .......................... 198,029
74 NTT DoCoMo, Inc. (b) .............................. 118,664
11,000 Panasonic Corporation. (b) ........................ 189,974
9,400 PIONEER Corporation (b) ........................... 62,114
5,700 Seven & I Holdings Company Ltd. (b) .............. 164,054
12,000 Sharp Corporation (b) ............................. 131,359
6,500 Sony Corporation (b) .............................. 200,803
4,500 SUMCO Corporation (b) ............................. 71,353
32 Sumitomo Mitsui Financial Group, Inc. (b) ......... 200,988
2,200 T&D Holdings, Inc. (b) ............................ 116,415
1,500 TDK CORPORATION (b) ............................... 75,263
5,800 Tokio Marine Holdings, Inc. (b) ................... 213,321
21,000 TOKYU CORPORATION (b) ............................. 100,508
------------
4,018,365
------------
NETHERLANDS -- 4.6%
5,024 Aegon NV (b) ...................................... 44,350
4,503 Fortis (b) ........................................ 28,429
3,276 ING Groep NV (b) .................................. 70,073
25,913 Koninklijke (Royal) KPN NV (b) ................... 373,397
5,039 Koninklijke (Royal) Philips Electronics NV (b) .... 136,415
------------
652,664
------------
NORWAY -- 1.1%
6,280 Statoil ASA (b) ................................... 148,291
------------
PORTUGAL -- 0.5%
18,498 EDP - Energias de Portugal SA (b) ................. 77,459
------------
SINGAPORE -- 2.2%
19,000 Capitaland Ltd. (b) ............................... 41,623
21,000 DBS Group Holdings Ltd. (b) ....................... 251,514
63,000 Synear Food Holdings Ltd. (b) .................... 13,285
------------
306,422
------------
19
THE JAMESTOWN INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 97.5% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
SOUTH KOREA -- 0.9%
1,930 Hyundai Motor Company (b) ......................... $ 120,778
------------
SPAIN -- 3.7%
11,907 Repsol YPF SA (b) ................................. 352,086
7,490 Telefonica SA (b) ................................ 177,696
------------
529,782
------------
SWEDEN -- 1.9%
16,253 Nordea Bank AB (b) ................................ 192,681
8,178 Telefonaktiebolaget LM Ericsson - B Shares (b) ... 77,120
------------
269,801
------------
SWITZERLAND -- 4.8%
3,059 Credit Suisse Group (b) ........................... 143,237
4,521 Novartis AG (b) ................................... 238,655
1,105 Roche Holdings AG (a) (b) ......................... 173,434
708 Swiss Re (b) ...................................... 39,401
308 Zurich Financial Services AG (b) .................. 85,516
------------
680,243
------------
UNITED KINGDOM -- 14.3%
2,051 Anglo American PLC (b) ............................ 69,573
1,315 AstraZeneca PLC (b) ............................... 57,716
9,642 BAE Systems PLC (a) (b) ........................... 71,220
3,524 Berkeley Group PLC (The) (a) (b) .................. 48,309
9,750 Cadbury Schweppes PLC (b) ......................... 98,865
1,511 Carnival PLC (b) .................................. 45,124
13,827 GlaxoSmithKline PLC (b) ........................... 300,427
24,006 J Sainsbury PLC (b) ............................... 151,161
27,358 Kingfisher PLC (b) ................................ 65,388
3,437 Land Securities Group PLC (b) ..................... 77,765
22,360 Lloyds TSB Group PLC (b) .......................... 90,180
25,741 Premier Foods PLC (b) ............................. 34,765
14,712 Prudential PLC (b) ................................ 134,755
16,024 Rolls-Royce Group PLC (b) ......................... 97,203
8,762 Royal Dutch Shell PLC - Class A (b) ............... 257,571
4,725 Royal Dutch Shell PLC - Class B (b) .............. 133,165
4,519 Smiths Group PLC (b) .............................. 82,156
4,874 Whitbread PLC (b) ................................. 92,512
23,536 William Morrison Supermarkets PLC (b) ............. 109,840
67,249 Woolworths Group PLC (b) .......................... 4,817
------------
2,022,512
------------
TOTAL COMMON STOCKS -- 97.5% (Cost $13,750,772) ... $ 13,752,879
OTHER ASSETS IN EXCESS OF LIABILITIES -- 2.5% ..... 356,445
------------
NET ASSETS -- 100.0% .............................. $ 14,109,324
============
(a) Non-income producing security.
(b) Fair value priced (Note 1). Fair valued securities totaled $13,652,938 at
September 30, 2008, representing 96.8% of net assets.
ADR - American Depositary Receipt.
See accompanying notes to financial statements.
20
THE JAMESTOWN INTERNATIONAL EQUITY FUND
SUMMARY OF COMMON STOCKS BY
INDUSTRY CLASSIFICATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
INDUSTRY VALUE % OF NET ASSETS
- --------------------------------------------------------------------------------
Pharmaceuticals $ 1,424,129 10.1%
Oil, Gas & Consumable Fuels 1,356,386 9.6%
Commerical Banks 1,323,430 9.4%
Insurance 1,107,454 7.8%
Diversified Telecommunication Services 755,646 5.4%
Food & Staples Retailing 743,836 5.3%
Household Durables 632,559 4.5%
Capital Markets 620,412 4.4%
Software 600,639 4.3%
Industrial Conglomerates 493,261 3.5%
Real Estate Management & Development 454,975 3.2%
Multi-Utilities 382,289 2.7%
Road & Rail 332,108 2.4%
Electronic Equipment, Instruments & Components 305,079 2.2%
Specialty Retail 300,347 2.1%
IT Services 297,673 2.1%
Communications Equipment 292,086 2.1%
Food Products 246,493 1.7%
Electric Utilities 216,345 1.5%
Chemicals 170,332 1.2%
Aerospace & Defense 168,423 1.2%
Machinery 165,806 1.2%
Multi-Line Retail 157,921 1.1%
Hotels, Restaurants & Leisure 137,636 1.0%
Automobiles 120,778 0.9%
Wireless Telecommunication Services 118,664 0.8%
Media 116,145 0.8%
Auto Components 113,792 0.8%
Office Electronics 112,037 0.8%
Building Products 103,742 0.7%
Diversified Financial Services 98,502 0.7%
Semiconductors & Semiconductor Equipment 92,070 0.6%
Electrical Equipment 82,684 0.6%
Metals & Mining 69,573 0.5%
Commerical Services & Supplies 39,627 0.3%
----------- ------
$13,752,879 97.5%
=========== ======
See accompanying notes to financial statements.
21
THE JAMESTOWN FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2008 (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 ......................... $ 25,116,380 $ 24,912,597 $ 22,323,338 $ 29,074,701 $ 13,750,772
============ ============ ============ ============ ============
At value (Note 1) ........................... $ 27,929,581 $ 28,345,217 $ 20,664,035 $ 28,913,616 $ 13,752,879
Cash .......................................... -- -- -- -- 195,602
Cash denominated in
foreign currency(a) (Note 5) ................ -- -- -- -- 12,793
Dividends and interest receivable ............. 142,262 28,288 26,065 378,804 58,835
Receivable for investment securities sold ..... 513,253 679,091 -- -- --
Receivable for capital shares sold ............ -- -- -- 550 --
Net unrealized appreciation on
forward foreign currency
exchange contracts (Note 6). ................ -- -- -- -- 23,235
Receivable for securities litigation settlement -- -- -- -- 150,954
Other assets .................................. 2,835 10,259 9,252 6,995 2,929
------------ ------------ ------------ ------------ ------------
TOTAL ASSETS ................................ 28,587,931 29,062,855 20,699,352 29,299,965 14,197,227
------------ ------------ ------------ ------------ ------------
LIABILITIES
Distributions payable ......................... 19,855 -- -- 12,175 1,198
Payable for securities purchased .............. 213,933 550,563 63,618 -- 55,886
Payable for capital shares redeemed ........... 10,219 8,220 -- 11,455 2,098
Accrued investment advisory fees (Note 3) ..... 15,786 15,966 13,543 8,038 8,161
Accrued administration fees (Note 3) .......... 4,000 4,000 4,000 3,600 4,000
Accrued compliance fees (Note 3) .............. 450 450 450 450 600
Other accrued expenses ........................ 9,133 -- 6,693 3,296 15,960
------------ ------------ ------------ ------------ ------------
TOTAL LIABILITIES ........................... 273,376 579,199 88,304 39,014 87,903
------------ ------------ ------------ ------------ ------------
NET ASSETS ...................................... $ 28,314,555 $ 28,483,656 $ 20,611,048 $ 29,260,951 $ 14,109,324
============ ============ ============ ============ ============
Net assets consist of:
Paid-in capital ............................... $ 25,448,099 $ 24,958,397 $ 23,847,930 $ 29,393,132 $ 25,744,239
Accumulated undistributed
net investment income ....................... 648 34,820 23,165 25,430 210,419
Accumulated net realized gains (losses)
from security transactions.. ................ 52,607 57,819 (1,600,744) 3,474 (11,871,390)
Net unrealized appreciation
(depreciation) on investments ............... 2,813,201 3,432,620 (1,659,303) (161,085) 2,107
Net unrealized appreciation on translation of
assets and liabilities in foreign currencies -- -- -- -- 23,949
------------ ------------ ------------ ------------ ------------
Net assets ...................................... $ 28,314,555 $ 28,483,656 $ 20,611,048 $ 29,260,951 $ 14,109,324
============ ============ ============ ============ ============
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) ................................. 2,351,583 1,885,090 2,271,507 2,965,776 1,255,630
============ ============ ============ ============ ============
Net asset value, offering price and redemption
price per share(b) ............................ $ 12.04 $ 15.11 $ 9.07 $ 9.87 $ 11.24
============ ============ ============ ============ ============
(a) For Jamestown International Equity Fund, the cost of cash denominated in
foreign currency is $12,953.
(b) For Jamestown International Equity Fund, redemption price varies based on
length of time held (Note 1).
See accompanying notes to financial statements.
22
THE JAMESTOWN FUNDS
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2008 (UNAUDITED)
=======================================================================================================================
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY SELECT VIRGINIA EQUITY
FUND FUND FUND FUND FUND
- -----------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME
Dividends ............................ $ 163,834 $ 221,506 $ 173,038 $ 8,818 $ 403,467
Foreign withholding taxes on dividends (188) (282) -- -- (49,453)
Interest ............................. 283,784 10,390 -- 594,931 684
------------ ------------ ------------ ------------ ------------
TOTAL INVESTMENT INCOME ............ 447,430 231,614 173,038 603,749 354,698
------------ ------------ ------------ ------------ ------------
EXPENSES
Investment advisory fees (Note 3) .... 102,766 104,643 89,979 58,745 84,783
Administration fees (Note 3).. ....... 24,039 24,146 24,000 21,597 23,800
Custodian and bank service fees ...... 5,608 7,597 2,456 2,360 35,515
Professional fees .................... 9,178 7,970 8,020 6,670 8,576
Trustees' fees and expenses .......... 8,019 8,019 8,019 8,019 8,019
Pricing costs ........................ 2,809 992 894 3,351 12,826
Compliance fees and expenses (Note 3) 2,675 2,683 2,622 2,687 3,432
Postage and supplies ................. 2,362 3,042 1,926 1,843 2,227
Registration fees .................... 1,205 2,047 1,808 597 2,191
Insurance expense .................... 1,424 1,432 1,090 1,334 874
Printing of shareholder reports ...... 1,255 1,842 992 842 992
Other expenses ....................... 5,599 929 8,067 3,603 2,592
------------ ------------ ------------ ------------ ------------
TOTAL EXPENSES ..................... 166,939 165,342 149,873 111,648 185,827
Fees waived by the Adviser (Note 3) .. -- -- -- (10,312) (63,740)
Expenses reimbursed through a directed
brokerage arrangement (Note 4) ..... (12,000) (6,000) -- -- --
------------ ------------ ------------ ------------ ------------
NET EXPENSES ....................... 154,939 159,342 149,873 101,336 122,087
------------ ------------ ------------ ------------ ------------
NET INVESTMENT INCOME .................. 292,491 72,272 23,165 502,413 232,611
------------ ------------ ------------ ------------ ------------
REALIZED AND UNREALIZED
GAINS (LOSSES) ON INVESTMENTS
AND FOREIGN CURRENCIES (NOTE 5)
Net realized gains (losses) from:
Security transactions .............. 255,555 251,344 (1,073,357) 3,406 324,132
Foreign currency transactions ...... -- -- -- -- 63,439
Net change in unrealized appreciation/
depreciation on:
Investments ........................ (2,377,581) (3,168,319) (1,968,671) (697,001) (3,782,090)
Foreign currency translation ....... -- -- -- -- 14,197
------------ ------------ ------------ ------------ ------------
NET REALIZED AND UNREALIZED
LOSSES ON INVESTMENTS
AND FOREIGN CURRENCIES ............... (2,122,026) (2,916,975) (3,042,028) (693,595) (3,380,322)
------------ ------------ ------------ ------------ ------------
NET DECREASE IN NET ASSETS
FROM OPERATIONS ...................... $ (1,829,535) $ (2,844,703) $ (3,018,863) $ (191,182) $ (3,147,711)
============ ============ ============ ============ ============
See accompanying notes to financial statements.
23
THE JAMESTOWN FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
============================================================================================================
JAMESTOWN JAMESTOWN
BALANCED FUND EQUITY FUND
------------------------------------------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
SEPTEMBER 30, ENDED SEPTEMBER 30, ENDED
2008 MARCH 31, 2008 MARCH 31,
(UNAUDITED) 2008 (UNAUDITED) 2008
- ------------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ..................... $ 292,491 $ 653,953 $ 72,272 $ 140,922
Net realized gains on security transactions 255,555 4,058,583 251,344 2,658,874
Net change in unrealized appreciation/
depreciation on investments ............. (2,377,581) (3,044,538) (3,168,319) (2,097,106)
------------ ------------ ------------ ------------
Net increase (decrease) in
net assets from operations ................ (1,829,535) 1,667,998 (2,844,703) 702,690
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ................ (285,951) (686,283) (37,452) (144,305)
From net realized gains from
security transactions ................... -- (4,206,732) -- (2,818,182)
Return of capital ......................... -- -- -- (252,510)
------------ ------------ ------------ ------------
Decrease in net assets from
distributions to shareholders ............. (285,951) (4,893,015) (37,452) (3,214,997)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ................. 42,136 379,678 636,449 1,161,482
Net asset value of shares issued
in reinvestment of distributions
to shareholders ......................... 247,099 4,406,636 33,662 2,884,634
Payments for shares redeemed .............. (1,916,877) (14,963,870) (1,620,825) (6,345,139)
------------ ------------ ------------ ------------
Net decrease in net assets from
capital share transactions ............... (1,627,642) (10,177,556) (950,714) (2,299,023)
------------ ------------ ------------ ------------
TOTAL DECREASE IN NET ASSETS ................ (3,743,128) (13,402,573) (3,832,869) (4,811,330)
NET ASSETS
Beginning of period ....................... 32,057,683 45,460,256 32,316,525 37,127,855
------------ ------------ ------------ ------------
End of period ............................. $ 28,314,555 $ 32,057,683 $ 28,483,656 $ 32,316,525
============ ============ ============ ============
ACCUMULATED UNDISTRIBUTED
(OVERDISTRIBUTED) NET
INVESTMENT INCOME ......................... $ 648 $ (7,197) $ 34,820 $ --
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ...................................... 3,230 25,189 38,198 60,885
Reinvested ................................ 19,725 311,807 1,982 158,224
Redeemed .................................. (147,157) (989,684) (92,939) (330,547)
------------ ------------ ------------ ------------
Net decrease in shares outstanding ........ (124,202) (652,688) (52,759) (111,438)
Shares outstanding, beginning of period ... 2,475,785 3,128,473 1,937,849 2,049,287
------------ ------------ ------------ ------------
Shares outstanding, end of period. ........ 2,351,583 2,475,785 1,885,090 1,937,849
============ ============ ============ ============
See accompanying notes to financial statements.
24
THE JAMESTOWN FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=================================================================================================================
JAMESTOWN JAMESTOWN TAX EXEMPT
SELECT FUND VIRGINIA FUND
------------------------------------------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED YEAR
SEPTEMBER 30, ENDED SEPTEMBER 30, ENDED
2008 MARCH 31, 2008 MARCH 31,
(UNAUDITED) 2008 (UNAUDITED) 2008
- -----------------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income (loss) ................... $ 23,165 $ (1,852) $ 502,413 $ 1,002,394
Net realized gains (losses) on
security transactions ........................ (1,073,357) (523,394) 3,406 16,403
Net change in unrealized appreciation/
depreciation on investments .................. (1,968,671) (478,663) (697,001) 92,995
------------ ------------ ------------ ------------
Net increase (decrease) in net
assets from operations ......................... (3,018,863) (1,003,909) (191,182) 1,111,792
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ..................... -- -- (492,362) (1,005,973)
From net realized gains from
security transactions ........................ -- (48,775) -- (17,179)
------------ ------------ ------------ ------------
Decrease in net assets from
distributions to shareholders .................. -- (48,775) (492,362) (1,023,152)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ...................... 830,381 6,625,526 1,628,638 3,083,061
Net asset value of shares issued in reinvestment
of distributions to shareholders ............. -- 46,579 418,605 849,870
Payments for shares redeemed ................... (735,037) (1,294,000) (1,196,125) (3,909,118)
------------ ------------ ------------ ------------
Net increase in net assets from
capital share transactions ..................... 95,344 5,378,105 851,118 23,813
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS .................................. (2,923,519) 4,325,421 167,574 112,453
NET ASSETS
Beginning of period ............................ 23,534,567 19,209,146 29,093,377 28,980,924
------------ ------------ ------------ ------------
End of period .................................. $ 20,611,048 $ 23,534,567 $ 29,260,951 $ 29,093,377
============ ============ ============ ============
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME .......................... $ 23,165 $ -- $ 25,430 $ 15,379
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ........................................... 79,014 585,751 162,011 305,634
Reinvested ..................................... -- 3,937 41,722 84,618
Redeemed ....................................... (72,051) (114,276) (118,697) (389,550)
------------ ------------ ------------ ------------
Net increase in shares outstanding ............. 6,963 475,412 85,036 702
Shares outstanding, beginning of period ........ 2,264,544 1,789,132 2,880,740 2,880,038
------------ ------------ ------------ ------------
Shares outstanding, end of period. ............. 2,271,507 2,264,544 2,965,776 2,880,740
============ ============ ============ ============
See accompanying notes to financial statements.
25
THE JAMESTOWN FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
=========================================================================================
JAMESTOWN
INTERNATIONAL EQUITY FUND
----------------------------
SIX MONTHS
ENDED YEAR
SEPTEMBER 30, ENDED
2008 MARCH 31,
(UNAUDITED) 2008
- -----------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income .................................. $ 232,611 $ 208,688
Net realized gains (losses) from:
Security transactions ................................ 324,132 3,263,585
Foreign currency transactions ........................ 63,439 (19,347)
Net change in unrealized appreciation/depreciation on:
Investments .......................................... (3,782,090) (4,079,730)
Foreign currency translation ......................... 14,197 8,808
------------ ------------
Net decrease in net assets from operations ............... (3,147,711) (617,996)
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ............................. (100,194) (174,778)
------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold .............................. 162,216 1,084,764
Net asset value of shares issued in reinvestment
of distributions to shareholders ..................... 98,834 170,675
Payments for shares redeemed ........................... (549,468) (8,806,832)
------------ ------------
Net decrease in net assets from capital share transactions (288,418) (7,551,393)
------------ ------------
TOTAL DECREASE IN NET ASSETS ............................. (3,536,323) (8,344,167)
NET ASSETS
Beginning of period .................................... 17,645,647 25,989,814
------------ ------------
End of period .......................................... $ 14,109,324 $ 17,645,647
============ ============
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME .................................. $ 210,419 $ 14,563
============ ============
CAPITAL SHARE ACTIVITY
Sold ................................................... 11,858 74,629
Reinvested ............................................. 8,079 11,344
Redeemed ............................................... (40,229) (609,773)
------------ ------------
Net decrease in shares outstanding ..................... (20,292) (523,800)
Shares outstanding, beginning of period ................ 1,275,922 1,799,722
------------ ------------
Shares outstanding, end of period ...................... 1,255,630 1,275,922
============ ============
See accompanying notes to financial statements.
26
THE JAMESTOWN BALANCED FUND
FINANCIAL HIGHLIGHTS
=============================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- -----------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPTEMBER 30, YEARS ENDED MARCH 31,
2008 ------------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 12.95 $ 14.53 $ 14.97 $ 14.92 $ 15.40 $ 13.76
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.12 0.26 0.27 0.26 0.29 0.27
Net realized and unrealized gains
(losses) on investments ............. (0.91) 0.27 0.69 1.06 0.14 2.48
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ (0.79) 0.53 0.96 1.32 0.43 2.75
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.12) (0.28) (0.29) (0.27) (0.30) (0.29)
Distributions from net realized gains . -- (1.83) (1.11) (1.00) (0.61) (0.82)
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.12) (2.11) (1.40) (1.27) (0.91) (1.11)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 12.04 $ 12.95 $ 14.53 $ 14.97 $ 14.92 $ 15.40
========== ========== ========== ========== ========== ==========
Total return (a) ........................ (6.13%)(b) 2.97% 6.57% 9.14% 2.83% 20.29%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 28,315 $ 32,058 $ 45,460 $ 56,879 $ 62,235 $ 63,838
========== ========== ========== ========== ========== ==========
Ratio of gross expenses to
average net assets .................... 1.05%(c) 1.01% 0.94% 0.93% 0.92% 0.91%
Ratio of net expenses to
average net assets (d) ................ 0.98%(c) 0.95% 0.89% 0.89% 0.88% 0.88%
Ratio of net investment income to
average net assets (d) ................ 1.85%(c) 1.71% 1.80% 1.72% 1.87% 1.77%
Portfolio turnover rate ................. 24%(b) 30% 40% 49% 29% 36%
(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.
27
THE JAMESTOWN EQUITY FUND
FINANCIAL HIGHLIGHTS
=============================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- -----------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPTEMBER 30, YEARS ENDED MARCH 31,
2008 ------------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 16.68 $ 18.12 $ 18.45 $ 17.69 $ 18.28 $ 14.47
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.04 0.08 0.10 0.07 0.12 0.05
Net realized and unrealized gains
(losses) on investments ............. (1.59) 0.20 1.15 2.11 0.65 4.30
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ (1.55) 0.28 1.25 2.18 0.77 4.35
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.02) (0.08) (0.10) (0.07) (0.12) (0.05)
Distributions from net realized gains . -- (1.50) (1.48) (1.35) (1.24) (0.49)
Return of capital ..................... -- (0.14) -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.02) (1.72) (1.58) (1.42) (1.36) (0.54)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 15.11 $ 16.68 $ 18.12 $ 18.45 $ 17.69 $ 18.28
========== ========== ========== ========== ========== ==========
Total return (a) ........................ (9.31%)(b) 0.94% 6.92% 12.69% 4.34% 30.10%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 28,484 $ 32,317 $ 37,128 $ 42,770 $ 42,253 $ 50,187
========== ========== ========== ========== ========== ==========
Ratio of gross expenses to
average net assets .................... 1.03%(c) 0.99% 0.97% 0.97% 0.95% 0.94%
Ratio of net expenses to
average net assets (d) ................ 0.99%(c) 0.95% 0.91% 0.92% 0.90% 0.88%
Ratio of net investment income
to average net assets (d) ............. 0.45%(c) 0.38% 0.52% 0.36% 0.63% 0.27%
Portfolio turnover rate ................. 36%(b) 46% 53% 60% 34% 52%
(a) Total return is a measure of the change in value of an investment in the
Fund over the period covered, which assumes any dividends or capital gains
distributions are reinvested in shares of the Fund. Returns do not reflect
the deduction of taxes a shareholder would pay on Fund distributions or
the redemption of Fund shares.
(b) 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.
28
THE JAMESTOWN SELECT FUND
FINANCIAL HIGHLIGHTS
========================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- --------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR PERIOD
SEPTEMBER 30, ENDED ENDED
2008 MARCH 31, MARCH 31,
(UNAUDITED) 2008 2007 (a)
- --------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .................... $ 10.39 $ 10.74 $ 10.00
---------- ---------- ----------
Income (loss) from investment operations:
Net investment income (loss) ............................ 0.01 (0.00)(c) 0.01
Net realized and unrealized gains (losses) on investments (1.33) (0.33) 0.75
---------- ---------- ----------
Total from investment operations .......................... (1.32) (0.33) 0.76
---------- ---------- ----------
Less distributions:
Dividends from net investment income .................... -- -- (0.02)
Dividends from net realized gains ....................... -- (0.02) --
---------- ---------- ----------
Total distributions ....................................... -- (0.02) (0.02)
---------- ---------- ----------
Net asset value at end of period .......................... $ 9.07 $ 10.39 $ 10.74
========== ========== ==========
Total return (b) .......................................... (12.70%)(e) (3.07%) 7.55%(e)
========== ========== ==========
Net assets at end of period (000's) ....................... $ 20,611 $ 23,535 $ 19,209
========== ========== ==========
Ratio of gross expenses to average net assets ............. 1.25%(d) 1.24% 1.47%(d)
Ratio of net expenses to average net assets ............... 1.25%(d) 1.24% 1.25%(d)
Ratio of net investment income (loss) to average net assets 0.19%(d) (0.01%) 0.31%(d)
Portfolio turnover rate ................................... 42%(e) 88% 46%(e)
(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) Amount rounds to less than a penny per share.
(d) Annualized.
(e) Not annualized.
See accompanying notes to financial statements.
29
THE JAMESTOWN TAX EXEMPT VIRGINIA FUND
FINANCIAL HIGHLIGHTS
=============================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- -----------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPTEMBER 30, YEARS ENDED MARCH 31,
2008 ------------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 10.10 $ 10.06 $ 10.05 $ 10.22 $ 10.57 $ 10.56
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.21 0.36 0.37 0.36 0.37 0.37
Net realized and unrealized gains
(losses) on investments ............. (0.27) 0.05 0.01 (0.17) (0.35) 0.00(a)
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ (0.06) 0.41 0.38 0.19 0.02 0.37
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.17) (0.36) (0.36) (0.36) (0.37) (0.36)
Distributions from net realized gains . -- (0.01) (0.01) -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.17) (0.37) (0.37) (0.36) (0.37) (0.36)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 9.87 $ 10.10 $ 10.06 $ 10.05 $ 10.22 $ 10.57
========== ========== ========== ========== ========== ==========
Total return (b) ........................ (0.62%)(c) 4.09% 3.85% 1.83% 0.19% 3.61%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 29,261 $ 29,093 $ 28,981 $ 30,421 $ 31,559 $ 33,602
========== ========== ========== ========== ========== ==========
Ratio of gross expenses to
average net assets .................... 0.76%(d) 0.77% 0.75% 0.73% 0.72% 0.74%
Ratio of net expenses to average net assets 0.69%(d) 0.69% 0.69% 0.69% 0.69% 0.69%
Ratio of net investment income to
average net assets .................... 3.34%(d) 3.54% 3.66% 3.50% 3.60% 3.46%
Portfolio turnover rate ................. 3%(c) 13% 10% 22% 15% 43%
(a) Amount rounds to 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.
See accompanying notes to financial statements.
30
THE JAMESTOWN INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
=============================================================================================================================
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
- -----------------------------------------------------------------------------------------------------------------------------
SIX MONTHS
ENDED
SEPTEMBER 30, YEARS ENDED MARCH 31,
2008 ------------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 13.83 $ 14.44 $ 12.76 $ 10.33 $ 9.42 $ 6.31
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.19 0.12 0.07 0.10 0.08 0.05
Net realized and unrealized
gains (losses) on investments
and foreign currencies .............. (2.70) (0.63) 1.69 2.43 0.91 3.12
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ (2.51) (0.51) 1.76 2.53 0.99 3.17
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.08) (0.10) (0.08) (0.10) (0.08) (0.05)
Distributions from net realized gains . -- -- -- -- -- (0.01)
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.08) (0.10) (0.08) (0.10) (0.08) (0.06)
---------- ---------- ---------- ---------- ---------- ----------
Proceeds from redemption fees collected . -- -- 0.00(a) 0.00(a) -- 0.00(a)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 11.24 $ 13.83 $ 14.44 $ 12.76 $ 10.33 $ 9.42
========== ========== ========== ========== ========== ==========
Total return (b) ........................ (18.19%)(c) (3.56%) 13.86% 24.54% 10.51% 50.22%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 14,109 $ 17,646 $ 25,990 $ 21,600 $ 20,266 $ 21,158
========== ========== ========== ========== ========== ==========
Ratio of gross expenses to
average net assets .................... 2.19%(d) 1.88% 1.75% 1.87% 1.92% 1.77%
Ratio of net expenses to
average net assets .................... 1.44%(d) 1.44% 1.44% 1.44% 1.43% 1.38%
Ratio of net investment income
to average net assets ................. 2.74%(d) 0.87% 0.52% 0.89% 0.78% 0.57%
Portfolio turnover rate ................. 5%(c) 11% 13% 13% 111% 78%
(a) Amount rounds to 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.
See accompanying notes to financial statements.
31
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2008 (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 Williamsburg Investment Trust (the "Trust"), an open-end
management investment company registered under the Investment Company Act of
1940, as amended. 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 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
32
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Fund are typically 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 Equity Fund's net asset
value per share 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.
The Financial Accounting Standards Board's ("FASB") Statement of Financial
Accounting Standards No. 157 "Fair Value Measurements" establishes a single
authoritative definition of fair value, sets out a framework for measuring fair
value and requires additional disclosures about fair value measurements.
Various inputs are used in determining the value of each Fund's investments.
These inputs are summarized in the three broad levels listed below:
o Level 1 - quoted prices in active markets for identical securities
o Level 2 - other significant observable inputs
o Level 3 - significant unobservable inputs
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.
The following is a summary of the inputs used to value each Fund's net assets as
of September 30, 2008:
- --------------------------------------------------------------------------------------------------------------------
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY SELECT VIRGINIA EQUITY
FUND FUND FUND FUND FUND
- --------------------------------------------------------------------------------------------------------------------
Level 1 - Quoted prices $18,056,775 $28,345,217 $20,664,035 $ 1,360,319 $ 99,941
Level 2 - Other significant observable inputs 9,872,806 -- -- 27,553,297 13,652,938
----------- ----------- ----------- ----------- -----------
Total $27,929,581 $28,345,217 $20,664,035 $28,913,616 $13,752,879
=========== =========== =========== =========== ===========
- --------------------------------------------------------------------------------------------------------------------
33
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
Repurchase agreements -- The Funds may enter into repurchase agreements. A
repurchase agreement, which is collateralized by U.S. Government obligations, is
valued at cost which, together with accrued interest, approximates market. At
the time a Fund enters into a 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, Funds actively monitor and seek additional collateral, as needed. If
the seller defaults, and the fair value of the collateral declines, realization
of the collateral by the Funds may be delayed or limited.
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, 2008 and March 31, 2008, there were no redemption fees collected.
Investment income -- Interest income is accrued as earned. Dividend income is
recorded on the ex-dividend date. Discounts and premiums on fixed income
securities purchased are amortized using the interest method.
Distributions to shareholders -- Dividends arising from net investment income,
if any, are declared and paid quarterly to shareholders of The Jamestown
Balanced Fund, The Jamestown Equity Fund and The Jamestown International Equity
Fund and are declared and paid annually to shareholders of the Jamestown Select
Fund. Dividends arising from net investment income 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.
The tax character of distributions paid during the periods ended September 30,
2008 and March 31, 2008 was as follows:
- -----------------------------------------------------------------------------------------------------------
EXEMPT-
PERIODS ORDINARY LONG-TERM INTEREST RETURN OF TOTAL
ENDED INCOME CAPITAL GAINS DIVIDENDS CAPITAL DISTRIBUTIONS
- -----------------------------------------------------------------------------------------------------------
Jamestown Balanced Fund 9/30/08 $ 285,951 $ -- $ -- $ -- $ 285,951
3/31/08 $ 1,028,786 $ 3,864,229 $ -- $ -- $ 4,893,015
- -----------------------------------------------------------------------------------------------------------
Jamestown Equity Fund 9/30/08 $ 37,452 $ -- $ -- $ -- $ 37,452
3/31/08 $ 328,829 $ 2,633,658 $ -- $ 252,210 $ 3,214,997
- -----------------------------------------------------------------------------------------------------------
Jamestown Select Fund 9/30/08 $ -- $ -- $ -- $ -- $ --
3/31/08 $ 48,775 $ -- $ -- $ -- $ 48,775
- -----------------------------------------------------------------------------------------------------------
Jametown Tax Exempt 9/30/08 $ -- $ -- $ 492,362 $ -- $ 492,362
Virginia Fund 3/31/08 $ -- $ 17,179 $ 1,005,973 $ -- $ 1,023,152
- -----------------------------------------------------------------------------------------------------------
Jamestown International 9/30/08 $ 100,194 $ -- $ -- $ -- $ 100,194
Equity Fund 3/31/08 $ 174,778 $ -- $ -- $ -- $ 174,778
- -----------------------------------------------------------------------------------------------------------
34
THE JAMESTOWN 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.
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, 2008 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 $ 25,162,880 $ 24,940,451 $ 22,323,973 $ 29,049,274 $ 13,763,126
============ ============ ============ ============ ============
Gross unrealized appreciation $ 4,009,486 $ 5,162,248 $ 919,178 $ 266,005 $ 2,027,172
Gross unrealized depreciation (1,242,785) (1,757,482) (2,579,116) (401,663) (2,037,419)
------------ ------------ ------------ ------------ ------------
Net unrealized appreciation
(depreciation) on investments 2,766,701 3,404,766 (1,659,938) (135,658) (10,247)
------------ ------------ ------------ ------------ ------------
Net unrealized appreciation on
translation of assets and liabilities
in foreign currencies -- -- -- -- 385
Accumulated undistributed
ordinary income 28,700 34,820 23,165 12,175 235,180
Accumulated undistributed
long-term gains -- -- -- 3,477 --
Capital loss carryforwards -- -- (229,908) -- (12,182,864)
Post-October losses -- -- (297,320) -- --
Other gains (losses) 90,910 85,673 (1,072,881) -- 323,829
Other temporary differences (19,855) -- -- (12,175) (1,198)
------------ ------------ ------------ ------------ ------------
Total distributable earnings
(accumulated deficit) $ 2,866,456 $ 3,525,259 $ (3,236,882) $ (132,181) $(11,634,915)
============ ============ ============ ============ ============
- ----------------------------------------------------------------------------------------------------------------------
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, 2008, The Jamestown Select Fund and The Jamestown International
Equity Fund had the following capital loss carryforwards for federal income tax
purposes:
- --------------------------------------------------------------------------------
EXPIRES
AMOUNT MARCH 31,
- --------------------------------------------------------------------------------
Jamestown Select Fund $ 229,908 2016
============
Jamestown International Equity Fund $ 11,562,523 2011
620,341 2012
------------
$ 12,182,864
============
- --------------------------------------------------------------------------------
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 Jamestown Select Fund had net realized losses of $297,320
during the period November 1, 2007 through March 31, 2008, which are treated for
federal income tax purposes as arising during the Fund's tax year ending March
31, 2009. 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.
36
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
For the six months ended September 30, 2008, The Jamestown Balanced Fund
reclassified $1,305 of overdistributed net investment income against accumulated
net realized gains 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 reclassification had no effect on the
Fund's net assets or net asset value per share.
Additionally, for the six months ended September 30, 2008, The Jamestown
International Equity Fund reclassified $63,439 of net realized gains from
security transactions against accumulated 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 had no effect on the Fund's net assets or net
asset value per share.
FASB's Interpretation No. 48 ("FIN 48") "Accounting for Uncertainty in Income
Taxes" 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. As required by FIN 48, management has analyzed the
Funds' tax positions taken on Federal income tax returns for all open tax years
(tax years ended March 31, 2005 through March 31, 2008) and has concluded that
no provision for income tax is required in these financial statements.
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, 2008:
- -------------------------------------------------------------------------------------------------------------
JAMESTOWN JAMESTOWN
JAMESTOWN JAMESTOWN JAMESTOWN TAX EXEMPT INTERNATIONAL
BALANCED EQUITY SELECT VIRGINIA EQUITY
FUND FUND FUND FUND FUND
- -------------------------------------------------------------------------------------------------------------
Purchase of investment securities $ 7,016,279 $ 10,554,733 $ 9,455,470 $ 1,487,719 $ 845,336
============ ============ ============ ============ ============
Proceeds from sales and maturities
of investment securities $ 7,529,114 $ 11,492,674 $ 9,371,740 $ 808,000 $ 853,964
============ ============ ============ ============ ============
- -------------------------------------------------------------------------------------------------------------
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
37
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
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, 2008, the Adviser voluntarily undertook
to limit the total operating expenses of The Jamestown Tax Exempt Virginia Fund
and The Jamestown International Equity Fund to .69% and 1.44%, respectively, of
average daily net assets. Accordingly, the Adviser voluntarily waived $10,312
and $63,740, respectively, of such Funds' investment advisory fees during the
six months ended September 30, 2008.
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. 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. The Jamestown Balanced Fund, The
Jamestown Equity Fund, The Jamestown Select Fund, The Jamestown Tax Exempt
Virginia Fund and The Jamestown International Equity Fund are subject to a
minimum monthly fee of $4,000, $4,000, $4,000, $3,500 and $4,000, respectively.
In addition, each Fund pays out-of-pocket expenses including, but not limited
to, postage, supplies and costs of pricing portfolio securities. Certain
officers of the Trust are also officers of Ultimus, or of Ultimus Fund
Distributors, LLC (the "Distributor"),
38
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
the principal underwriter of each Fund's shares and an affiliate of Ultimus. 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 $22,200 plus an
asset-based fee equal to 0.01% per annum on the Funds' aggregate net assets in
excess of $100 million. In addition, the Funds reimburse Ultimus for reasonable
out-of-pocket expenses, if any, incurred in connection with these services.
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 $12,000 and $6,000
for The Jamestown Balanced Fund and The Jamestown Equity Fund, respectively, for
the six months ended September 30, 2008.
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.
39
THE JAMESTOWN FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
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.
As of September 30, 2008, The Jamestown International Equity Fund had forward
foreign currency exchange contracts outstanding as follows:
- ---------------------------------------------------------------------------------------------------
NET UNREALIZED
TO RECEIVE INITIAL MARKET APPRECIACTION
SETTLEMENT (TO DELIVER) VALUE VALUE (DEPRECIATION)
- --------------------------------------------------------------------------------------------------
Contracts To Buy
10/1/2008......................... 9714 EUR $ (13,974) $ (13,645) $ (329)
10/1/2008......................... 15,744 GBP (28,934) (28,062) (872)
12/31/2008........................ 1,505,323 JPY (14,309) (14,187) (122)
----------- ---------- ----------
Total Buy Contracts................. (57,217) (55,894) (1,323)
----------- ---------- ----------
Contracts To Sell
12/31/2008........................ (510,409) GBP 936,218 911,660 24,558
----------- ---------- ----------
Net Contracts....................... $ 879,001 $ 855,766 $ 23,235
=========== ========== ==========
- ---------------------------------------------------------------------------------------------------
EUR - Euro
GBP - British Pound Sterling
JPY - Japanese Yen
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.
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 (April 1, 2008 through September 30, 2008).
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
2008 2008 Period
- --------------------------------------------------------------------------------
THE JAMESTOWN BALANCED FUND
- --------------------------------------------------------------------------------
Based on Actual Fund Return $ 1,000.00 $ 938.70 $ 4.76
Based on Hypothetical 5% Return
(before expenses) $ 1,000.00 $ 1,020.16 $ 4.96
- --------------------------------------------------------------------------------
THE JAMESTOWN EQUITY FUND
- --------------------------------------------------------------------------------
Based on Actual Fund Return $ 1,000.00 $ 906.90 $ 4.73
Based on Hypothetical 5% Return
(before expenses) $ 1,000.00 $ 1,020.10 $ 5.01
- --------------------------------------------------------------------------------
THE JAMESTOWN SELECT FUND
- --------------------------------------------------------------------------------
Based on Actual Fund Return $ 1,000.00 $ 873.00 $ 5.87
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 $ 993.80 $ 3.45
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 $ 818.10 $ 6.56
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 0.98%
The Jamestown Equity Fund 0.99%
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
THIS PAGE INTENTIONALLY LEFT BLANK.
THIS PAGE INTENTIONALLY LEFT BLANK.
================================================================================
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
Samuel B. Witt, III
================================================================================
================================================================================
THE
GOVERNMENT STREET
FUNDS
No-Load Mutual Funds
Semi-Annual Report
September 30, 2008
(Unaudited)
================================================================================
[LOGO OMITTED]
LEAVELL
==== INVESTMENT MANAGEMENT ====
TRUSTED INVESTMENT SOLUTIONS SINCE 1979
================================================================================
The Government Street Equity Fund
The Government Street Mid-Cap Fund
The Alabama Tax Free Bond Fund
================================================================================
THE GOVERNMENT STREET EQUITY FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SECTOR CONCENTRATION VS. THE S&P 500 INDEX
[BAR CHART OMITTED] (% OF NET ASSETS)
The Government Street S&P 500
Equity Fund Index
----------------- -------
Consumer Discretionary 6.8% 8.5%
Consumer Staples 10.1% 12.2%
Energy 11.7% 13.4%
Financials 12.0% 15.8%
Health Care 12.6% 13.1%
Industrials 12.7% 11.1%
Information Technology 12.9% 16.0%
Materials 3.3% 3.4%
Telecommunication Services 1.3% 3.0%
Utilities 3.0% 3.5%
Exchange-Traded Funds 7.0% 0.0%
Cash Equivalents 6.6% 0.0%
TOP TEN EQUITY HOLDINGS
SECURITY DESCRIPTION % OF NET ASSETS
- -------------------------------------------------------
Bank of America Corporation 3.7%
Procter & Gamble Company (The) 3.3%
U.S. Bancorp 2.9%
Hewlett-Packard Company 2.9%
Philip Morris International, Inc. 2.7%
Vanguard FTSE All-World Ex-US Index ETF 2.5%
Adobe Systems, Inc. 2.5%
Johnson & Johnson 2.3%
ConocoPhillips 2.3%
General Dynamics Corporation 2.1%
3
THE GOVERNMENT STREET MID-CAP FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SECTOR 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 8.1% 13.7%
Consumer Staples 3.3% 3.8%
Energy 7.9% 7.4%
Financials 15.2% 19.2%
Health Care 16.1% 12.3%
Industrials 14.4% 15.4%
Information Technology 12.6% 13.0%
Materials 5.9% 6.9%
Telecommunication Services 0.1% 0.5%
Utilities 7.6% 7.8%
Cash Equivalents 8.8% 0.0%
TOP TEN EQUITY HOLDINGS
SECURITY DESCRIPTION % OF NET ASSETS
- -------------------------------------------------------
Gilead Sciences, Inc. 1.9%
Stericycle, Inc. 1.7%
SPX Corporation 1.3%
Eaton Vance Corporation 1.2%
Covance, Inc. 1.2%
Fastenal Company 1.2%
Church & Dwight Company, Inc. 1.1%
Rayonier, Inc. 1.1%
Cullen/Frost Bankers, Inc. 1.1%
Techne Corporation 1.1%
4
THE ALABAMA TAX FREE BOND FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
ASSET ALLOCATION
[PIE CHART OMITTED]
Revenue Bonds 38.9%
General Obligation Bonds 44.5%
Pre-Refunded & Escrowed Bonds 12.5%
Cash Equivalents 4.1%
DISTRIBUTION BY RATING
- ------------------------------------------------------
RATING % HOLDINGS
------ -------------
AAA 26.6%
AA 65.0%
A 8.4%
5
THE GOVERNMENT STREET EQUITY FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 86.4% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 6.8%
6,000 Coach, Inc. (a) ................................... $ 150,240
26,500 Home Depot, Inc. .................................. 686,085
4,000 ITT Educational Services, Inc. (a) ................ 323,640
24,000 Johnson Controls, Inc. ............................ 727,920
11,000 NIKE, Inc. - Class B .............................. 735,900
10,000 Panasonic Corporation - ADR ....................... 173,300
40,000 Walt Disney Company (The) ......................... 1,227,600
------------
4,024,685
------------
CONSUMER STAPLES -- 10.1%
33,000 Altria Group, Inc. ................................ 654,720
22,836 Kraft Foods, Inc. ................................. 747,879
10,000 PepsiCo, Inc. ..................................... 712,700
33,000 Philip Morris International, Inc. ................. 1,587,300
28,000 Procter & Gamble Company (The) .................... 1,951,320
6,000 Wal-Mart Stores, Inc. ............................. 359,340
------------
6,013,259
------------
ENERGY -- 11.7%
10,089 Apache Corporation ................................ 1,052,081
7,300 BP plc - ADR ...................................... 366,241
15,000 Chevron Corporation ............................... 1,237,200
18,500 ConocoPhillips .................................... 1,355,125
6,000 ENSCO International, Inc. ......................... 345,780
7,200 Exxon Mobil Corporation ........................... 559,152
10,000 Plains Exploration & Production Company (a) ....... 351,600
14,000 Spectra Energy Corporation ........................ 333,200
7,996 Transocean, Inc. (a) .............................. 878,281
10,000 XTO Energy, Inc. .................................. 465,200
------------
6,943,860
------------
FINANCIALS -- 12.0%
27,900 Aegon N.V. - ARS .................................. 244,962
13,800 AFLAC, Inc. ....................................... 810,750
8,000 American Capital Strategies Ltd. .................. 204,080
20,000 American Express Company .......................... 708,600
16,500 American International Group, Inc. ................ 54,945
62,870 Bank of America Corporation ....................... 2,200,450
15,000 Charles Schwab Corporation (The) .................. 390,000
40,000 Colonial Properties Trust ......................... 747,600
7,000 Regions Financial Corporation ..................... 67,200
48,400 U.S. Bancorp ...................................... 1,743,368
------------
7,171,955
------------
HEALTH CARE -- 12.6%
3,000 Abbott Laboratories ............................... 172,740
12,190 Becton, Dickinson & Company ....................... 978,369
17,500 Cardinal Health, Inc. ............................. 862,400
5,500 Cerner Corporation (a) ............................ 245,520
4,000 Covance, Inc. (a) ................................. 353,640
6
THE GOVERNMENT STREET EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 86.4% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
HEALTH CARE -- 12.6% (CONTINUED)
2,000 Covidien Ltd. ..................................... $ 107,520
20,000 Elan Corporation (a) .............................. 213,400
5,000 Fresenius Medical Care AG & Company - ADR ......... 259,700
6,500 Genzyme Corporation (a) ........................... 525,785
7,000 Gilead Sciences, Inc. (a) ......................... 319,060
20,000 Johnson & Johnson ................................. 1,385,600
11,250 Techne Corporation (a) ............................ 811,350
6,500 Thermo Fisher Scientific, Inc. (a) ................ 357,500
16,000 Waters Corporation (a) ............................ 930,880
------------
7,523,464
------------
INDUSTRIALS -- 12.7%
19,500 Caterpillar, Inc. ................................. 1,162,200
3,000 C.H. Robinson Worldwide, Inc. ..................... 152,880
30,000 Emerson Electric Company .......................... 1,223,700
9,500 FedEx Corporation ................................. 750,880
17,000 General Dynamics Corporation ...................... 1,251,540
16,000 Ingersoll-Rand Company Ltd. - Class A ............. 498,720
10,000 Norfolk Southern Corporation ...................... 662,100
23,000 Quanta Services, Inc. (a) ......................... 621,230
5,000 Stericycle, Inc. (a) .............................. 294,550
16,000 United Technologies Corporation ................... 960,960
------------
7,578,760
------------
INFORMATION TECHNOLOGY -- 12.9%
9,500 Accenture Ltd. - Class A .......................... 361,000
37,000 Adobe Systems, Inc. (a) ........................... 1,460,390
20,000 Automatic Data Processing, Inc. ................... 855,000
5,000 Broadridge Financial Solutions, Inc. .............. 76,950
35,900 Cisco Systems, Inc. (a) ........................... 809,904
28,000 Corning, Inc. ..................................... 437,920
6,000 Dell, Inc. (a) .................................... 98,880
37,000 Hewlett-Packard Company ........................... 1,710,880
7,000 International Business Machines Corporation ....... 818,720
12,000 NetApp, Inc. (a) .................................. 218,760
10,000 Oracle Corporation (a) ............................ 203,100
24,000 Texas Instruments, Inc. ........................... 516,000
5,000 Tyco Electronics Ltd. ............................. 138,300
------------
7,705,804
------------
MATERIALS -- 3.3%
7,000 Alcoa, Inc. ....................................... 158,060
9,000 Dow Chemical Company (The) ........................ 286,020
2,000 Freeport-McMoRan Copper & Gold, Inc. .............. 113,700
10,000 Nucor Corporation ................................. 395,000
7,000 POSCO - ADR ....................................... 653,590
5,000 Praxair, Inc. ..................................... 358,700
------------
1,965,070
------------
7
THE GOVERNMENT STREET EQUITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 86.4% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES -- 1.3%
9,000 America Movil SAB de C.V. - Series L - ADR ........ $ 417,240
6,000 AT&T, Inc. ........................................ 167,520
37 FairPoint Communications, Inc. .................... 321
4,000 Nippon Telegraph and Telephone Corporation - ADR .. 90,040
2,000 Telephone and Data Systems, Inc. .................. 71,500
------------
746,621
------------
UTILITIES -- 3.0%
65,980 Duke Energy Corporation ........................... 1,150,031
4,500 EnergySouth, Inc. ................................. 276,435
2,000 FirstEnergy Corporation ........................... 133,980
5,000 Wisconsin Energy Corporation ...................... 224,500
------------
1,784,946
------------
TOTAL COMMON STOCKS (Cost $31,035,420) ............ $ 51,458,424
------------
================================================================================
SHARES EXCHANGE-TRADED FUNDS -- 7.0% VALUE
- --------------------------------------------------------------------------------
7,000 Market Vectors - Agribusiness ETF (a) ............. $ 257,880
10,000 Market Vectors - Coal ETF (a) ..................... 295,300
5,000 Market Vectors - Steel ETF ........................ 263,050
10,000 Standard & Poor's Depositary Receipts, SPDR Trust,
Series I ........................................ 1,160,200
20,000 Vanguard Emerging Markets ETF ..................... 693,200
35,000 Vanguard FTSE All-World Ex-US Index ETF ........... 1,485,400
------------
TOTAL EXCHANGE-TRADED FUNDS (Cost $5,317,528) ..... $ 4,155,030
------------
================================================================================
PAR VALUE COMMERCIAL PAPER -- 6.7% VALUE
- --------------------------------------------------------------------------------
$1,103,000 Deutsche Bank Financial, LLC, 1.40%, due 10/01/2008 $ 1,103,000
2,862,000 General Electric Capital Corporation, 1.65%, due
10/01/2008 ...................................... 2,862,000
------------
TOTAL COMMERCIAL PAPER (Cost $3,965,000) .......... $ 3,965,000
------------
================================================================================
SHARES MONEY MARKET FUNDS -- 0.0% VALUE
- --------------------------------------------------------------------------------
970 AIM STIT - STIC Prime Portfolio - Institutional
Class, 2.204% (b) (Cost $970) ................... $ 970
------------
TOTAL INVESTMENTS AT VALUE -- 100.1%
(Cost $40,318,918) .............................. $ 59,579,424
LIABILITIES IN EXCESS OF OTHER ASSETS -- (0.1%) ... (1,042,475)
------------
NET ASSETS -- 100.0% .............................. $ 58,536,949
============
(a) Non-income producing security.
(b) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
ADR - American Depositary Receipt
ARS - American Registered Shares
See accompanying notes to financial statements.
8
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 91.2% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 8.1%
2,500 AnnTaylor Stores Corporation (a) .................. $ 51,600
2,000 ArvinMeritor, Inc. ................................ 26,080
6,500 Barnes & Noble, Inc. .............................. 169,520
2,000 Bob Evans Farms, Inc. ............................. 54,580
3,000 BorgWarner, Inc. .................................. 98,310
220 Central European Media Enterprises Ltd. - Class A (a) 14,388
2,900 Coach, Inc. (a) ................................... 72,616
1,700 Darden Restaurants, Inc. .......................... 48,671
3,500 DreamWorks Animation SKG, Inc. - Class A (a) ...... 110,075
3,000 Family Dollar Stores, Inc. ........................ 71,100
5,700 GameStop Corporation - Class A (a) ................ 194,997
2,500 Hanesbrands, Inc. (a) ............................. 54,375
4,300 Hasbro, Inc. ...................................... 149,296
600 HSN, Inc. (a) ..................................... 6,606
900 Interactive Data Corporation ...................... 22,698
1,605 ITT Educational Services, Inc. (a) ................ 129,861
3,000 Jarden Corporation (a) ............................ 70,350
2,500 Liberty Global, Inc. - Class A (a) ................ 75,750
1,200 Nordstrom, Inc. ................................... 34,584
2,800 OfficeMax, Inc. ................................... 24,892
5,800 O'Reilly Automotive, Inc. (a) ..................... 155,266
1,000 PetSmart, Inc. .................................... 24,710
3,000 Phillips-Van Heusen Corporation ................... 113,730
2,200 Ross Stores, Inc. ................................. 80,982
6,000 Service Corporation International ................. 50,160
2,950 Snap-on, Inc. ..................................... 155,347
3,400 Sotheby's ......................................... 68,204
600 Ticketmaster (a) .................................. 6,438
1,300 Tiffany & Company ................................. 46,176
1,200 Urban Outfitters, Inc. (a) ........................ 38,244
2,500 Vail Resorts, Inc. (a) ............................ 87,375
1,600 Wiley (John) & Sons, Inc. - Class A ............... 64,720
------------
2,371,701
------------
CONSUMER STAPLES -- 3.3%
5,400 Church & Dwight Company, Inc. ..................... 335,286
6,000 Hormel Foods Corporation .......................... 217,680
4,700 J.M. Smucker Company .............................. 238,243
3,000 NBTY, Inc. (a) .................................... 88,560
1,740 Universal Corporation ............................. 85,417
------------
965,186
------------
ENERGY -- 7.9%
6,610 Cameron International Corporation (a) ............. 254,749
5,780 FMC Technologies, Inc. (a) ........................ 269,059
3,740 Murphy Oil Corporation ............................ 239,884
2,800 Newfield Exploration Company (a) .................. 89,572
5,360 Noble Corporation ................................. 235,304
3,600 Overseas Shipholding Group, Inc. .................. 209,916
960 Patriot Coal Corporation (a) ...................... 27,888
9
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 91.2% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
ENERGY -- 7.9% (CONTINUED)
4,800 Peabody Energy Corporation ........................ $ 216,000
4,380 Pioneer Natural Resources Company ................. 228,986
5,000 Pride International, Inc. (a) ..................... 148,050
4,500 Smith International, Inc. ......................... 263,880
4,950 Valero Energy Corporation ......................... 149,985
------------
2,333,273
------------
FINANCIALS -- 15.2%
8,400 American Financial Group, Inc. .................... 247,800
6,750 Arthur J. Gallagher & Company ..................... 173,205
7,300 Associated Banc-Corp .............................. 145,635
6,000 Bank of Hawaii Corporation ........................ 320,700
10,050 Berkley (W.R.) Corporation ........................ 236,677
5,600 Cullen/Frost Bankers, Inc. ........................ 327,040
10,250 Eaton Vance Corporation ........................... 361,107
2,600 Everest Re Group Ltd. ............................. 224,978
9,300 HCC Insurance Holdings, Inc. ...................... 251,100
10,400 Jefferies Group, Inc. ............................. 227,552
3,780 Legg Mason, Inc. .................................. 143,867
4,600 Liberty Property Trust ............................ 173,190
10,270 New York Community Bancorp, Inc. .................. 172,433
6,941 Potlatch Corporation .............................. 321,993
7,000 Rayonier, Inc. .................................... 331,450
4,400 State Street Corporation .......................... 250,272
16,400 Synovus Financial Corporation ..................... 169,740
3,300 Westamerica Bancorporation ........................ 189,849
6,650 Wilmington Trust Corporation ...................... 191,720
------------
4,460,308
------------
HEALTH CARE -- 16.1%
3,500 Applied Biosystems, Inc. .......................... 119,875
1,000 Bard (C.R.), Inc. ................................. 94,870
3,450 Barr Pharmaceuticals, Inc. (a) .................... 225,285
2,500 Bio-Rad Laboratories, Inc. - Class A (a) .......... 247,800
2,500 Cephalon, Inc. (a) ................................ 193,725
6,000 Cerner Corporation (a) ............................ 267,840
8,000 Community Health Systems, Inc. (a) ................ 234,480
4,000 Covance, Inc. (a) ................................. 353,640
8,250 Coventry Health Care, Inc. (a) .................... 268,537
1,500 Covidien Ltd. ..................................... 80,640
5,600 DENTSPLY International, Inc. ...................... 210,224
2,000 Edwards Lifesciences Corporation (a) .............. 115,520
1,000 Elan Corporation plc - ADR (a) .................... 10,670
4,000 Fresenius Medical Care AG & Company - ADR ......... 207,760
12,000 Gilead Sciences, Inc. (a) ......................... 546,960
4,000 Henry Schein, Inc. (a) ............................ 215,360
1,500 IDEXX Laboratories, Inc. (a) ...................... 82,200
2,000 Millipore Corporation (a) ......................... 137,600
7,700 Mylan, Inc. ....................................... 87,934
3,000 ResMed, Inc. (a) .................................. 129,000
4,500 Techne Corporation (a) ............................ 324,540
10
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 91.2% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
HEALTH CARE -- 16.1% (CONTINUED)
3,000 Teleflex, Inc. .................................... $ 190,470
5,100 Varian Medical Systems, Inc. (a) .................. 291,363
2,000 Waters Corporation (a) ............................ 116,360
------------
4,752,653
------------
INDUSTRIALS -- 14.4%
3,000 Alexander & Baldwin, Inc. ......................... 132,090
7,500 AMETEK, Inc. ...................................... 305,775
5,000 C.H. Robinson Worldwide, Inc. ..................... 254,800
6,000 Donaldson Company, Inc. ........................... 251,460
6,000 Expeditors International of Washington, Inc. ...... 209,040
7,000 Fastenal Company .................................. 345,730
3,500 Goodrich Corporation .............................. 145,600
6,000 Graco, Inc. ....................................... 213,660
3,000 Harsco Corporation ................................ 111,570
5,500 Herman Miller, Inc. ............................... 134,585
4,475 Jacobs Engineering Group, Inc. (a) ................ 243,037
1,248 John Bean Technologies Corporation (a) ............ 15,800
2,000 Joy Global, Inc. .................................. 90,280
1,500 Koninklijke Philips Electronics N.V. - ADR ........ 40,875
3,000 L-3 Communications Holdings, Inc. ................. 294,960
4,000 Manpower, Inc. .................................... 172,640
5,000 MSC Industrial Direct Company, Inc. ............... 230,350
5,000 SPX Corporation ................................... 385,000
8,275 Stericycle, Inc. (a) .............................. 487,480
5,000 Trinity Industries, Inc. .......................... 128,650
1,000 WESCO International, Inc. (a) ..................... 32,180
------------
4,225,562
------------
INFORMATION TECHNOLOGY -- 12.6%
16,000 Activision Blizzard, Inc. (a) ..................... 246,880
8,500 ADC Telecommunications, Inc. (a) .................. 71,825
6,000 ADTRAN, Inc. ...................................... 116,940
4,000 Advent Software, Inc. (a) ......................... 140,920
5,000 Alliance Data Systems Corporation (a) ............. 316,900
8,000 Arrow Electronics, Inc. (a) ....................... 209,760
8,000 Cognizant Technology Solutions Corporation -
Class A (a) ..................................... 182,640
1,000 CommScope, Inc. (a) ............................... 34,640
6,500 Cree, Inc. (a) .................................... 148,070
4,000 DST Systems, Inc. (a) ............................. 223,960
6,000 Harris Corporation ................................ 277,200
1,500 IAC/InterActiveCorp (a) ........................... 25,950
10,000 Integrated Device Technology, Inc. (a) ............ 77,800
9,000 Jack Henry & Associates, Inc. ..................... 182,970
6,000 Lam Research Corporation (a) ...................... 188,940
5,000 Linear Technology Corporation ..................... 153,300
6,000 Macrovision Corporation (a) ....................... 92,280
5,000 Microchip Technology, Inc. ........................ 147,150
8,000 National Instruments Corporation .................. 240,400
5,000 NetApp, Inc. (a) .................................. 91,150
4,000 Polycom, Inc. (a) ................................. 92,520
11
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 91.2% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY -- 12.6% (CONTINUED)
5,000 SanDisk Corporation (a) ........................... $ 97,750
4,000 Sybase, Inc. (a) .................................. 122,480
7,000 Xilinx, Inc. ...................................... 164,150
2,500 Zebra Technologies Corporation - Class A (a) ...... 69,625
------------
3,716,200
------------
MATERIALS -- 5.9%
4,000 Airgas, Inc. ...................................... 198,600
8,000 Albemarle Corporation ............................. 246,720
3,000 Ashland, Inc. ..................................... 87,720
4,000 Cabot Corporation ................................. 127,120
2,500 Eagle Materials, Inc. ............................. 55,925
2,500 Martin Marietta Materials, Inc. ................... 279,950
4,000 Scotts Miracle-Gro Company (The) - Class A ........ 94,560
9,570 Sonoco Products Company ........................... 284,038
12,000 Steel Dynamics, Inc. .............................. 205,080
7,000 Valspar Corporation (The) ......................... 156,030
------------
1,735,743
------------
TELECOMMUNICATION SERVICES -- 0.1%
1,000 Telephone and Data Systems, Inc. .................. 35,750
------------
UTILITIES -- 7.6%
8,400 AGL Resources, Inc. ............................... 263,592
7,000 Equitable Resources, Inc. ......................... 256,830
9,050 Great Plains Energy, Inc. ......................... 200,457
8,850 MDU Resources Group, Inc. ......................... 256,650
5,750 ONEOK, Inc. ....................................... 197,800
7,900 Pepco Holdings, Inc. .............................. 180,989
10,800 Puget Energy, Inc. ................................ 288,360
7,530 SCANA Corporation ................................. 293,143
10,600 Vectren Corporation ............................... 295,210
------------
2,233,031
------------
TOTAL COMMON STOCKS (Cost $22,542,373) ............ $ 26,829,407
------------
================================================================================
PAR VALUE COMMERCIAL PAPER -- 8.7% VALUE
- --------------------------------------------------------------------------------
$1,134,000 Deutsche Bank Financial, LLC, 1.40%, due 10/01/2008 $ 1,134,000
1,420,000 General Electric Capital Corporation, 1.65%,
due 10/01/2008 .................................. 1,420,000
------------
TOTAL COMMERCIAL PAPER (Cost $2,554,000) .......... $ 2,554,000
------------
12
THE GOVERNMENT STREET MID-CAP FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES MONEY MARKET FUNDS -- 0.0% VALUE
- --------------------------------------------------------------------------------
251 AIM STIT - STIC Prime Portfolio - Institutional
Class, 2.204% (b) (Cost $251) ................... $ 251
------------
TOTAL INVESTMENTS AT VALUE -- 99.9%
(COST $25,096,624) .............................. $ 29,383,658
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.1% ..... 29,724
------------
NET ASSETS -- 100.0% .............................. $ 29,413,382
============
(a) Non-income producing security.
(b) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
ADR - American Depositary Receipt
See accompanying notes to financial statements.
13
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 95.9% VALUE
- --------------------------------------------------------------------------------
Alabama Drinking Water Financing Auth., Rev.,
$ 250,000 4.00%, due 08/15/2014 ........................... $ 248,182
400,000 5.00%, due 08/15/2018 ........................... 404,220
------------
652,402
------------
Alabama Special Care Facilities Financing Auth.,
Birmingham, Rev.,
500,000 4.50%, due 11/01/2009, ETM ...................... 510,865
400,000 5.375%, due 11/01/2012, ETM ..................... 400,668
------------
911,533
------------
Alabama Special Care Facilities Financing Auth.,
Mobile Hospital, Rev.,
250,000 4.50%, due 11/01/2010, ETM ...................... 255,075
------------
Alabama State Federal Highway Financing Auth., Rev.,
210,000 5.00%, due 03/01/2009 ........................... 212,104
300,000 5.00%, due 03/01/2016 ........................... 305,853
------------
517,957
------------
Alabama State, GO,
250,000 5.00%, due 06/01/2012 ........................... 256,895
300,000 5.00%, due 09/01/2015 ........................... 310,632
300,000 5.00%, due 09/01/2016 ........................... 310,632
300,000 5.00%, due 09/01/2017 ........................... 310,659
------------
1,188,818
------------
Alabama State Parks System Improvement Corporation, GO,
200,000 5.50%, due 06/01/2010 ........................... 209,328
------------
Alabama State Public School & College Auth.,
Capital Improvements, Rev.,
300,000 5.00%, due 02/01/2010 ........................... 309,153
475,000 5.00%, due 11/01/2012 ........................... 482,823
600,000 5.125%, due 11/01/2013 .......................... 609,948
525,000 5.125%, due 11/01/2015 .......................... 533,704
------------
1,935,628
------------
Alabama State Public School & College Auth., Rev.,
355,000 5.00%, due 05/01/2010 ........................... 367,553
------------
Alabama Water Pollution Control Auth., Rev.,
500,000 5.00%, due 08/15/2010 ........................... 509,105
------------
Anniston, AL, Waterworks & Sewer Board, Rev.,
400,000 4.00%, due 06/01/2015 ........................... 400,616
------------
Athens, AL, Electric Rev. Warrants,
500,000 3.00%, due 06/01/2011 ........................... 496,270
------------
Athens, AL, School Warrants,
335,000 5.05%, due 08/01/2015 ........................... 338,775
------------
14
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 95.9% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
Auburn, AL, Capital Improvements, School Warrants, GO,
$ 225,000 5.00%, due 08/01/2012 ........................... $ 237,901
------------
Auburn, AL, School Warrants, GO,
285,000 4.25%, due 08/01/2009 ........................... 289,520
------------
Auburn, AL, Water Works Board, Rev.,
335,000 5.00%, due 07/01/2015 ........................... 345,663
------------
Auburn University, AL, General Fee Rev.,
400,000 4.45%, due 06/01/2011 ........................... 403,624
400,000 5.25%, due 06/01/2015 ........................... 412,448
------------
816,072
------------
Baldwin Co., AL, Board of Education, Rev. Warrants,
200,000 5.20%, due 06/01/2009 ........................... 200,476
300,000 5.00%, due 06/01/2010 ........................... 309,750
------------
510,226
------------
Baldwin Co., AL, GO,
500,000 4.50%, due 11/01/2008 ........................... 500,935
200,000 5.00%, due 02/01/2015 ........................... 209,250
320,000 5.00%, due 02/01/2017 ........................... 332,013
------------
1,042,198
------------
Birmingham, AL, Special Care Facilities
Financing Auth., Rev.,
300,000 3.70%, due 06/01/2009 ........................... 300,876
------------
Decatur, AL, Warrants, GO,
300,000 5.00%, due 06/01/2009 ........................... 300,615
------------
Decatur, AL, Water Rev.,
100,000 5.00%, due 05/01/2014 ........................... 102,016
------------
Dothan, AL, GO,
500,000 5.50%, due 09/01/2014 ........................... 519,340
------------
Fairhope, AL, Warrants,
295,000 5.10%, due 06/01/2014 ........................... 304,354
------------
Florence, AL, School Warrants,
200,000 4.65%, due 12/01/2012 ........................... 204,416
------------
Homewood, AL, Warrants, GO,
500,000 5.00%, due 09/01/2014 ........................... 532,265
250,000 5.00%, due 09/01/2015 ........................... 263,827
------------
796,092
------------
15
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 95.9% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
Hoover, AL, Special Tax, Warrants,
$ 370,000 5.00%, due 02/15/2015 ........................... $ 379,021
------------
Houston Co., AL, GO,
300,000 5.60%, due 10/15/2014 ........................... 315,294
------------
Huntsville, AL, Capital Improvements, GO,
100,000 3.25%, due 11/01/2010 ........................... 100,937
------------
Huntsville, AL, Electric Systems, Rev.,
300,000 4.00%, due 12/01/2013 ........................... 305,460
------------
Huntsville, AL, GO,
400,000 5.50%, due 08/01/2009 ........................... 410,764
500,000 5.00%, due 08/01/2011 ........................... 525,945
250,000 5.25%, due 11/01/2012 ........................... 252,925
300,000 5.125%, due 05/01/2020 .......................... 304,716
------------
1,494,350
------------
Huntsville, AL, Water Systems, Rev.,
200,000 4.70%, due 11/01/2013 ........................... 202,250
------------
Jefferson Co., AL, Sewer Rev.,
225,000 5.00%, due 02/01/2041, Prerefunded
02/01/2011 @ 101 ................................ 236,371
------------
Madison, AL, Warrants,
200,000 4.40%, due 02/01/2011 ........................... 203,902
400,000 4.85%, due 02/01/2013 ........................... 406,452
------------
610,354
------------
Madison Co., AL, Board of Education, Capital
Outlay Tax Antic. Warrants,
400,000 5.20%, due 03/01/2011 ........................... 415,840
250,000 5.20%, due 03/01/2014 ........................... 258,433
------------
674,273
------------
Mobile, AL, GO,
400,000 4.75%, due 02/15/2014 ........................... 414,516
500,000 5.20%, due 08/15/2018 ........................... 504,810
------------
919.326
------------
Mobile, AL, Water & Sewer, Rev.,
300,000 5.25%, due 01/01/2014 ........................... 310,293
------------
Mobile Co., AL, Refunding & Improvements, Warrants, GO,
100,000 4.50%, due 08/01/2013 ........................... 104,093
------------
Montgomery, AL, GO,
300,000 5.00%, due 11/01/2015 ........................... 309,735
------------
Montgomery, AL, Special Care Facilities, Rev.,
125,000 5.00%, due 11/15/2029 ........................... 126,549
------------
16
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
ALABAMA FIXED RATE REVENUE AND GENERAL
PAR VALUE OBLIGATION (GO) BONDS -- 95.9% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
Montgomery, AL, Waterworks & Sanitation, Rev.,
$ 350,000 5.25%, due 09/01/2011 ........................... $ 370,167
------------
Mountain Brook, AL, City Board of Education,
Capital Outlay Warrants,
405,000 4.80%, due 02/15/2011 ........................... 405,579
------------
Opelika, AL, GO,
210,000 4.00%, due 03/01/2010 ........................... 213,520
------------
Scottsboro, AL, Waterworks Sewer & Gas Board, Rev.,
200,000 4.35%, due 08/01/2011 ........................... 201,486
------------
Shelby Co., AL, Board of Education, Rev. Warrants,
500,000 4.80%, due 02/01/2011 ........................... 507,320
------------
St. Clair Co., AL, GO,
145,000 4.00%, due 08/01/2013 ........................... 148,344
205,000 4.00%, due 08/01/2014 ........................... 208,571
------------
356,915
------------
Trussville, AL, Warrants,
400,000 4.30%, due 10/01/2010 ........................... 412,000
------------
Tuscaloosa, AL, Board of Education, Special Tax Warrants,
300,000 4.85%, due 02/15/2013 ........................... 300,342
------------
Tuscaloosa, AL, Warrants, GO,
145,000 4.25%, due 02/15/2011 ........................... 149,188
500,000 5.45%, due 01/01/2014 ........................... 523,160
400,000 5.55%, due 01/01/2015, Prerefunded
01/01/2010 @ 101 ................................ 419,020
------------
1,091,368
------------
Tuscaloosa Co., AL, Warrants, GO,
425,000 4.30%, due 10/01/2009 ........................... 434,189
------------
University of Alabama, AL, General Fee Rev.,
240,000 4.10%, due 12/01/2013 ........................... 242,218
------------
University of Alabama, AL, Series A, Rev.,
375,000 4.00%, due 10/01/2010 ........................... 384,443
245,000 5.00%, due 07/01/2017 ........................... 253,227
------------
637,670
------------
Vestavia Hills, AL, Warrants,
565,000 5.00%, due 02/01/2012 ........................... 594,081
------------
TOTAL ALABAMA FIXED RATE REVENUE AND GENERAL
OBLIGATION (GO) BONDS (Cost $25,221,013) ........ $ 25,407,510
------------
17
THE ALABAMA TAX-FREE BOND FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES MONEY MARKET FUNDS -- 3.3% VALUE
- --------------------------------------------------------------------------------
877,319 Alpine Municipal Money Market Fund -
Class I, 6.29% (a) (Cost $877,319) .............. $ 877,319
------------
TOTAL INVESTMENTS AT VALUE -- 99.2%
(Cost $26,098,332) .............................. $ 26,284,829
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.8% ..... 217,161
------------
NET ASSETS -- 100.0% .............................. $ 26,501,990
============
(a) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
ETM - Escrowed to maturity.
See accompanying notes to financial statements.
18
THE GOVERNMENT STREET FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2008 (UNAUDITED)
=========================================================================================
GOVERNMENT GOVERNMENT ALABAMA
STREET STREET TAX FREE
EQUITY MID-CAP BOND
FUND FUND FUND
- -----------------------------------------------------------------------------------------
ASSETS
Investments in securities:
At acquisition cost ..................... $ 40,318,918 $ 25,096,624 $ 26,098,332
============ ============ ============
At value (Note 1) ....................... $ 59,579,424 $ 29,383,658 $ 26,284,829
Dividends and interest receivable ......... 91,702 47,922 300,817
Receivable for capital shares sold ........ 14,342 1,788 --
Other assets .............................. 12,167 8,452 7,596
------------ ------------ ------------
TOTAL ASSETS ............................ 59,697,635 29,441,820 26,593,242
------------ ------------ ------------
LIABILITIES
Distributions payable ..................... 7,689 -- 26,897
Payable for investment securities purchased 1,071,257 -- --
Payable for capital shares redeemed ....... 35,718 6,698 48,770
Accrued investment advisory fees (Note 3) . 30,149 12,535 5,966
Accrued administration fees (Note 3).. .... 6,600 4,000 3,500
Accrued compliance fees (Note 3) .......... 625 550 550
Other accrued expenses .................... 8,648 4,655 5,569
------------ ------------ ------------
TOTAL LIABILITIES ....................... 1,160,686 28,438 91,252
------------ ------------ ------------
NET ASSETS ................................ $ 58,536,949 $ 29,413,382 $ 26,501,990
============ ============ ============
Net assets consist of:
Paid-in capital ........................... $ 38,523,366 $ 25,264,133 $ 26,366,641
Accumulated undistributed
net investment income ................... 7,708 68,874 16,170
Accumulated net realized gains (losses)
from security transactions .............. 745,369 (206,659) (67,318)
Net unrealized appreciation
on investments .......................... 19,260,506 4,287,034 186,497
------------ ------------ ------------
Net assets ................................ $ 58,536,949 $ 29,413,382 $ 26,501,990
============ ============ ============
Shares of beneficial interest outstanding
(unlimited number of shares authorized,
no par value) ........................... 1,456,686 2,529,948 2,563,300
============ ============ ============
Net asset value, offering price and
redemption price per share (Note 1). .... $ 40.19 $ 11.63 $ 10.34
============ ============ ============
See accompanying notes to financial statements.
19
THE GOVERNMENT STREET FUNDS
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2008 (UNAUDITED)
=======================================================================================
GOVERNMENT GOVERNMENT ALABAMA
STREET STREET TAX FREE
EQUITY MID-CAP BOND
FUND FUND FUND
- ---------------------------------------------------------------------------------------
INVESTMENT INCOME
Interest ............................. $ 16,072 $ 22,545 $ 528,491
Dividends ............................ 702,445 213,799 11,175
------------ ------------ ------------
TOTAL INVESTMENT INCOME ............ 718,517 236,344 539,666
------------ ------------ ------------
EXPENSES
Investment advisory fees (Note 3) .... 200,148 122,031 46,882
Administration fees (Note 3) ......... 42,898 24,176 21,000
Trustees' fees and expenses .......... 8,147 8,147 8,147
Professional fees .................... 9,330 7,446 6,796
Custodian and bank service fees ...... 5,470 5,989 2,633
Compliance fees and expenses (Note 3) 3,697 3,346 3,330
Pricing costs ........................ 1,221 1,962 5,843
Account maintenance fees ............. 3,608 3,350 603
Postage and supplies ................. 2,857 1,974 1,913
Registration fees .................... 2,316 2,223 1,412
Insurance expense .................... 2,645 1,405 1,223
Printing of shareholder reports ...... 2,322 1,219 1,093
Other expenses ....................... 5,444 2,218 2,219
------------ ------------ ------------
TOTAL EXPENSES ..................... 290,103 185,486 103,094
Fees waived by the Adviser (Note 3) .. -- (6,508) (16,027)
------------ ------------ ------------
NET EXPENSES ....................... 290,103 178,978 87,067
------------ ------------ ------------
NET INVESTMENT INCOME .................. 428,414 57,366 452,599
------------ ------------ ------------
REALIZED AND UNREALIZED GAINS
(LOSSES) ON INVESTMENTS
Net realized gains (losses) from
security transactions .............. 792,253 (213,943) --
Net realized gains from in-kind
redemptions (Note 1) ............... 1,510,757 236,919 --
Net change in unrealized appreciation/
depreciation on investments ........ (9,045,829) (1,710,661) (413,336)
------------ ------------ ------------
NET REALIZED AND UNREALIZED
LOSSES ON INVESTMENTS ................ (6,742,819) (1,687,685) (413,336)
------------ ------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS ...................... $ (6,314,405) $ (1,630,319) $ 39,263
============ ============ ============
See accompanying notes to financial statements.
20
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
2008 MARCH 31, 2008 MARCH 31,
(UNAUDITED) 2008 (UNAUDITED) 2008
- ---------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income .................. $ 428,414 $ 906,424 $ 57,366 $ 86,354
Net realized gains (losses) from
security transactions ............... 792,253 1,965,343 (213,943) 756,786
Net realized gains from in-kind
redemptions (Note 1) ................. 1,510,757 10,223,336 236,919 369,183
Net change in unrealized appreciation/
depreciation on investments .......... (9,045,829) (14,723,170) (1,710,661) (2,471,103)
------------ ------------ ------------ ------------
Net decrease in net assets from operations (6,314,405) (1,628,067) (1,630,319) (1,258,780)
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ............. (420,706) (906,812) -- (131,638)
From realized capital gains
on security transactions ............. -- (2,019,387) -- (749,760)
Return of capital ...................... -- (265,270) -- --
------------ ------------ ------------ ------------
Decrease in net assets from
distributions to shareholders .......... (420,706) (3,191,469) -- (881,398)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold .............. 1,407,055 1,964,944 837,122 1,588,631
Net asset value of shares issued in
reinvestment of distributions
to shareholders ...................... 404,615 3,075,937 -- 859,223
Payments for shares redeemed. .......... (3,806,492) (20,710,964) (1,217,113) (2,844,837)
------------ ------------ ------------ ------------
Net decrease in net assets from
capital share transactions ............. (1,994,822) (15,670,083) (379,991) (396,983)
------------ ------------ ------------ ------------
TOTAL DECREASE IN NET ASSETS .. .......... (8,729,933) (20,489,619) (2,010,310) (2,537,161)
NET ASSETS
Beginning of period .................... 67,266,882 87,756,501 31,423,692 33,960,853
------------ ------------ ------------ ------------
End of period .......................... $ 58,536,949 $ 67,266,882 $ 29,413,382 $ 31,423,692
============ ============ ============ ============
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME .................. $ 7,708 $ -- $ 68,874 $ 11,508
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ................................... 31,588 40,023 66,187 119,232
Reinvested ............................. 9,586 62,867 -- 64,918
Redeemed ............................... (87,254) (414,553) (95,635) (210,523)
------------ ------------ ------------ ------------
Net decrease in shares outstanding ..... (46,080) (311,663) (29,448) (26,373)
Shares outstanding, beginning of period 1,502,766 1,814,429 2,559,396 2,585,769
------------ ------------ ------------ ------------
Shares outstanding, end of period ...... 1,456,686 1,502,766 2,529,948 2,559,396
============ ============ ============ ============
See accompanying notes to financial statements.
21
THE GOVERNMENT STREET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
========================================================================================
ALABAMA TAX FREE
BOND FUND
----------------------------
SIX MONTHS
ENDED YEAR
SEPT. 30, ENDED
2008 MARCH 31,
(UNAUDITED) 2008
- ----------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ................................. $ 452,599 $ 872,561
Net realized gains from security transactions ......... -- 16,614
Net change in unrealized appreciation/
depreciation on investments ......................... (413,336) 265,263
------------ ------------
Net increase in net assets from operations .............. 39,263 1,154,438
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income ............................ (451,445) (869,547)
From realized capital gains on security transactions .. -- (15,917)
------------ ------------
Decrease in net assets from distributions to shareholders (451,445) (885,464)
------------ ------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold ............................. 2,156,288 1,373,954
Net asset value of shares issued in reinvestment
of distributions to shareholders .................... 287,080 559,466
Payments for shares redeemed .......................... (955,593) (2,744,430)
------------ ------------
Net increase (decrease) in net assets from
capital share transactions ............................ 1,487,775 (811,010)
------------ ------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ................. 1,075,593 (542,036)
NET ASSETS
Beginning of period ................................... 25,426,397 25,968,433
------------ ------------
End of period ......................................... $ 26,501,990 $ 25,426,397
============ ============
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME ................................. $ 16,170 $ 15,016
============ ============
CAPITAL SHARE ACTIVITY
Sold .................................................. 205,682 131,729
Reinvested ............................................ 27,508 53,777
Redeemed .............................................. (91,325) (264,214)
------------ ------------
Net increase (decrease) in shares outstanding ......... 141,865 (78,708)
Shares outstanding, beginning of period ............... 2,421,435 2,500,143
------------ ------------
Shares outstanding, end of period ..................... 2,563,300 2,421,435
============ ============
See accompanying notes to financial statements.
22
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,
2008 ------------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- ----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 44.76 $ 48.37 $ 52.42 $ 47.11 $ 46.10 $ 34.13
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income.. ............... 0.29 0.57 0.48 0.50 0.50 0.32
Net realized and unrealized
gains (losses) on investments ....... (4.57) (2.12) 2.90 5.31 1.01 11.97
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ (4.28) (1.55) 3.38 5.81 1.51 12.29
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.29) (0.57) (0.48) (0.50) (0.50) (0.32)
Distributions from net realized gains . -- (1.31) (6.95) -- -- --
Return of capital ..................... -- (0.18) -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.29) (2.06) (7.43) (0.50) (0.50) (0.32)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 40.19 $ 44.76 $ 48.37 $ 52.42 $ 47.11 $ 46.10
========== ========== ========== ========== ========== ==========
Total return (a) ........................ (9.60%)(b) (3.51%) 7.04% 12.39% 3.27% 36.09%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 58,537 $ 67,267 $ 87,757 $ 107,243 $ 132,922 $ 129,719
========== ========== ========== ========== ========== ==========
Ratio of expenses to average net assets . 0.87%(c) 0.84% 0.84% 0.78% 0.76% 0.79%
Ratio of net investment income
to average net assets.. ............... 1.28%(c) 1.12% 0.96% 0.95% 1.08% 0.77%
Portfolio turnover rate.. ............... 15%(b) 12% 15% 17% 13% 15%
(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.
See accompanying notes to financial statements.
23
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
2008 ---------------------------------------------------- MARCH 31,
(UNAUDITED) 2008 2007 2006 2005 2004 (a)
- ----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 12.28 $ 13.13 $ 13.71 $ 11.30 $ 10.33 $ 10.00
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income.. ............... 0.03 0.03 0.04 0.05 0.01 0.01
Net realized and unrealized
gains (losses) on investments ....... (0.68) (0.53) 0.45 2.38 0.97 0.68
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ (0.65) (0.50) 0.49 2.43 0.98 0.69
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. -- (0.05) (0.05) (0.02) (0.01) (0.01)
Distributions from net realized gains . -- (0.30) (1.02) -- (0.00)(b) (0.35)
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... -- (0.35) (1.07) (0.02) (0.01) (0.36)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 11.63 $ 12.28 $ 13.13 $ 13.71 $ 11.30 $ 10.33
========== ========== ========== ========== ========== ==========
Total return (c) ........................ (5.29%)(d) (3.99%) 3.83% 21.51% 9.47% 6.83%(d)
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 29,413 $ 31,424 $ 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% 1.10% 1.09%(f)
Ratio of net investment income
to average net assets.. ............... 0.35%(f) 0.25% 0.26% 0.37% 0.14% 0.11%(f)
Portfolio turnover rate.. ............... 6%(d) 11% 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 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
ratios of expenses to average net assets would have been 1.14%(f) for the
six months ended September 30, 2008 and 1.12%, 1.12%, 1.11%, 1.23% and
1.71%(f) for the periods ended March 31, 2008, 2007, 2006, 2005 and 2004,
respectively (Note 3).
(f) Annualized.
See accompanying notes to financial statements.
24
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,
2008 ------------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- ----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 10.50 $ 10.39 $ 10.40 $ 10.55 $ 10.90 $ 10.89
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.18 0.36 0.36 0.34 0.35 0.35
Net realized and unrealized
gains (losses) on investments ....... (0.16) 0.12 (0.01) (0.15) (0.36) 0.01
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ 0.02 0.48 0.35 0.19 (0.01) 0.36
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.18) (0.36) (0.36) (0.34) (0.34) (0.35)
Distributions from net realized gains . -- (0.01) -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.18) (0.37) (0.36) (0.34) (0.34) (0.35)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 10.34 $ 10.50 $ 10.39 $ 10.40 $ 10.55 $ 10.90
========== ========== ========== ========== ========== ==========
Total return (a) ........................ 0.15%(b) 4.66% 3.38% 1.80% (0.06%) 3.40%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 26,502 $ 25,426 $ 25,968 $ 26,182 $ 34,525 $ 38,702
========== ========== ========== ========== ========== ==========
Ratio of net expenses to
average net assets (c) ................ 0.65%(d) 0.65% 0.65% 0.65% 0.65% 0.65%
Ratio of net investment income
to average net assets ................. 3.37%(d) 3.46% 3.44% 3.25% 3.21% 3.26%
Portfolio turnover rate ................. 3%(b) 6% 15% 5% 4% 10%
(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) Absent investment advisory fees voluntarily waived by the Adviser, the
ratios of expenses to average net assets would have been 0.77%(d) for the
six months ended September 30, 2008 and 0.78%, 0.76%, 0.73%, 0.69% and
0.68% for the years ended March 31, 2008, 2007, 2006, 2005 and 2004,
respectively (Note 3).
(d) Annualized.
See accompanying notes to financial statements.
25
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
The Government Street Equity Fund, The Government Street Mid-Cap 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, as
amended, 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 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. 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.
26
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The Financial Accounting Standards Board's ("FASB") Statement on Financial
Accounting Standards No. 157 "Fair Value Measurements" establishes a single
authoritative definition of fair value, sets out a framework for measuring fair
value and requires additional disclosures about fair value measurements.
Various inputs are used in determining the value of each of the Fund's
investments. These inputs are summarized in the three broad levels listed below:
o Level 1 - quoted prices in active markets for identical securities
o Level 2 - other significant observable inputs
o Level 3 - significant unobservable inputs
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.
The following is a summary of the inputs used to value each Fund's net assets as
of September 30, 2008:
- -------------------------------------------------------------------------------------------
THE THE THE
GOVERNMENT GOVERNMENT ALABAMA
STREET EQUITY STREET MID-CAP TAX FREE BOND
VALUATION INPUTS FUND FUND FUND
- -------------------------------------------------------------------------------------------
Level 1 - Quoted Prices ..................... $ 55,614,424 $ 26,829,658 $ 877,319
Level 2 - Other Significant Observable Inputs 3,965,000 2,554,000 25,407,510
------------ ------------ ------------
Total ....................................... $ 59,579,424 $ 29,383,658 $ 26,284,829
============ ============ ============
- -------------------------------------------------------------------------------------------
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 repurchase agreements. A
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 a Fund enters into a repurchase agreement, the Fund takes 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, Funds
actively monitor and seek additional collateral, as needed. If the seller
defaults, and the fair value of the collateral declines, realization of the
collateral by the Funds may be delayed or limited.
27
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
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; 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, 2008 and March 31, 2008 are as follows:
- -----------------------------------------------------------------------------------------------
PERIODS ORDINARY EXEMPT-INTEREST LONG-TERM RETURN OF TOTAL
ENDED INCOME DIVIDENDS GAINS CAPITAL DISTRIBUTIONS
- -----------------------------------------------------------------------------------------------
Government Street 09/30/08 $ 420,706 $ -- $ -- $ -- $ 420,706
Equity Fund 03/31/08 $1,059,790 $ -- $1,866,409 $ 265,270 $3,191,469
Government Street 09/30/08 $ -- $ -- $ -- $ -- $ --
Mid-Cap Fund 03/31/08 $ 150,519 $ -- $ 730,879 $ -- $ 881,398
Alabama Tax Free 09/30/08 $ -- $ 451,445 $ -- $ -- $ 451,445
Bond Fund 03/31/08 $ -- $ 869,547 $ 15,917 $ -- $ 885,464
- -----------------------------------------------------------------------------------------------
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.
28
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
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, 2008:
- --------------------------------------------------------------------------------
GOVERNMENT GOVERNMENT ALABAMA
STREET STREET TAX FREE
EQUITY MID-CAP BOND
FUND FUND FUND
- --------------------------------------------------------------------------------
Cost of portfolio investments $ 40,401,981 $ 25,096,624 $ 26,149,684
============ ============ ============
Gross unrealized appreciation $ 22,812,363 $ 6,188,897 $ 303,642
Gross unrealized depreciation (3,634,920) (1,901,863) (168,497)
------------ ------------ ------------
Net unrealized appreciation . 19,177,443 4,287,034 135,145
Undistributed ordinary income 15,397 69,072 26,897
Undistributed long-term gains -- 7,085 204
Other gains (losses) ........ 828,432 (213,942) --
Other temporary differences . (7,689) -- (26,897)
------------ ------------ ------------
Total distributable earnings $ 20,013,583 $ 4,149,249 $ 135,349
============ ============ ============
- --------------------------------------------------------------------------------
The difference between the federal income tax cost of portfolio investments and
the financial statement cost for The Government Street Equity 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.
During the six months ended September 30, 2008, The Government Street Equity
Fund and The Government Street Mid-Cap Fund realized $1,510,757 and $236,919,
respectively, of net capital gains resulting from in-kind redemptions
(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 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.
29
THE GOVERNMENT STREET FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
FASB's Interpretation No. 48 ("FIN 48") "Accounting for Uncertainty in Income
Taxes" 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. As required by FIN 48, management has analyzed the
Funds' tax positions taken on Federal income tax returns for all open tax years
(tax years ended March 31, 2005 through March 31, 2008) and has concluded that
no provision for income tax is required in these financial statments.
2. INVESTMENT TRANSACTIONS
During the six months ended September 30, 2008, cost of purchases and proceeds
from sales and maturities of investment securities, other than short-term
investments and U.S. government securities, amounted to $9,559,618 and
$13,328,848, respectively, for The Government Street Equity Fund; $1,773,580 and
$1,803,743, respectively, for The Government Street Mid-Cap Fund; and $2,141,738
and $800,000, respectively, for The Alabama Tax Free Bond Fund.
3. TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY AGREEMENT
The Funds' investments are managed by Leavell Investment Management, Inc. (the
"Adviser"), formerly T. Leavell & Associates, Inc., 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 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, 2008, the Adviser voluntarily undertook
to limit the total operating expenses of The Government Street Mid-Cap Fund and
The Alabama Tax Free Bond Fund to 1.10% and .65%, respectively, of average daily
net assets. Accordingly, the Adviser voluntarily waived $6,508 and $16,027,
respectively, of its investment advisory fees from The Government Street Mid-Cap
Fund and The Alabama Tax Free Bond Fund during the six months ended September
30, 2008.
Certain officers of the Trust are also officers of the Adviser.
30
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 assets in excess of $50 million. The Government Street
Equity Fund, The Government Street Mid-Cap Fund and The Alabama Tax Free Bond
Fund are subject to a minimum monthly fee of $4,000, $4,000 and $3,500,
respectively. In addition, each Fund pays out-of-pocket expenses including, but
not limited to, postage, supplies and costs of pricing 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 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 Funds' compliance policies and procedures. For
these services, the Funds pay Ultimus an annual base fee of $18,600 plus an
asset-based fee equal to 0.01% per annum on the Funds' aggregate net assets in
excess of $100 million. In addition, the Funds reimburse Ultimus for reasonable
out-of-pocket expenses, if any, incurred in connection with these services.
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.
31
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. These ongoing costs, 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 (April 1, 2008) shown and held for the entire
period (September 30, 2008).
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.
32
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, 2008 Sept. 30, 2008 During Period*
- -----------------------------------------------------------------------------------------
THE GOVERNMENT STREET EQUITY FUND
- -----------------------------------------------------------------------------------------
Based on Actual Fund Return .......... $ 1,000.00 $ 904.00 $ 4.15
- -----------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) ................. $ 1,000.00 $ 1,020.71 $ 4.41
- -----------------------------------------------------------------------------------------
THE GOVERNMENT STREET MID-CAP FUND
- -----------------------------------------------------------------------------------------
Based on Actual Fund Return .......... $ 1,000.00 $ 947.10 $ 5.37
- -----------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) ................. $ 1,000.00 $ 1,019.55 $ 5.57
- -----------------------------------------------------------------------------------------
THE ALABAMA TAX FREE BOND FUND
- -----------------------------------------------------------------------------------------
Based on Actual Fund Return .......... $ 1,000.00 $ 1,001.50 $ 3.26
- -----------------------------------------------------------------------------------------
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 0.87%
The Government Street Mid-Cap Fund 1.10%
The Alabama Tax Free Bond Fund 0.65%
33
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.
34
This page intentionally left blank.
The Government Street Funds
===================================
No Load Mutual Funds
INVESTMENT ADVISER
Leavell Investment Management, 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
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
- --------------------------------------------------------------------------------
THE
FLIPPIN, BRUCE & PORTER
FUNDS
===========================
FBP Value Fund
FBP Balanced Fund
SEMI-ANNUAL REPORT
September 30, 2008
(Unaudited)
NO-LOAD FUNDS
- --------------------------------------------------------------------------------
LETTER TO SHAREHOLDERS NOVEMBER 20, 2008
================================================================================
We are pleased to report on your Funds and their investments for the semi-annual
period ended September 30, 2008. We first will provide some comments on the
semi-annual period and then will address our views on the unprecedented
financial and economic situation that exists today.
The credit crunch escalated during this six-month period, leading to
unprecedented stresses in the financial system, not only in the U.S. but around
the world. Equity markets responded as one might expect, with the S&P 500 down
10.9% and the Russell 1000 Value down 11.1%. Fixed income markets as well came
under pressure, losing on average about 3% in the wake of bankruptcies and
recession concerns. Government intervention in the banking system reached new
levels as a number of financial firms were effectively taken over by the
government through highly dilutive conservatorships. Other firms were forced
into mergers with stronger partners. Since the beginning of the year, Treasury
Secretary Henry Paulson, Fed Chairman Ben Bernanke and other government
officials have attempted to address problems on a case-by-case basis, only to
find their efforts insufficient to stem market fears. In the last few days of
the quarter, The Troubled Assets Relief Program (or TARP), a more comprehensive
approach intended to address the credit crisis in a more systematic manner, was
introduced and then passed by Congress in early October.
The Funds' returns in that tough environment were similar to the overall market,
with the FBP Balanced Fund down 7.96% and the FBP Value Fund down 12.04%. The
investments the Funds held in both Health Care and Information Technology were
beneficial to returns. Late in the period, Energy and other commodity prices
began to break down, which we had been anticipating for some time. Weakness in
those sectors aided the Funds' relative performance because of their lower
exposure to commodity-sensitive stocks. Stock selection in Financials prevented
results from being much better, as the Funds held some stocks that were severely
impacted by turmoil in the sector. The fixed income portion of the Balanced Fund
performed much better than the overall fixed income market due to the short
maturity structure and high quality nature of the holdings.
Since September 30, 2008, it has become apparent that a severe global recession
is occurring and is being accompanied by an unprecedented financial crisis. A
number of factors have led to a substantial sell-off in stocks and fixed income
investments since September 30th. Consumers, weighted down by the problems in
the housing industry and too much debt, are holding back on spending except for
essentials, while financial institutions and businesses are reducing costs and
preparing for a tough period ahead. This loss of confidence is producing a sharp
reduction in economic activity both here and abroad. Hedge funds, as well as the
majority of the larger financial institutions worldwide, had over the last
several years leveraged their portfolios to produce higher returns. We, and many
others, believe that the volatile and swift correction in financial prices over
the last couple of months is a reflection of the de-leveraging of those
portfolios and their need to raise cash for redeeming investors. Funds are being
pulled from hedge funds to move to other investment choices; however those funds
cannot be
2
reinvested until early 2009. It is also clear to us that economic conditions
will be tough for some time.
While we do not know how long this down cycle may last, we do know there are
some positives at work. Although more time is needed to see additional benefits,
the substantial monetary and fiscal policies being carried out worldwide are
beginning to unfreeze the credit markets. Additional fiscal and monetary
stimulus packages are being planned. Rising commodity costs, especially energy,
contributed significantly to the slowing global economy. Now, lower energy
prices should cause these forces to begin to work in reverse and allow consumer
incomes to be directed to other uses. Lower inflation, also acting as a
positive, will be evident in the months ahead. The reduction in home prices has
improved affordability. That, combined with the Government's efforts to help
stressed homeowners, should bring about stabilization of the housing market in
the foreseeable future. Investor sentiment today is extremely negative,
resulting in an oversold market and thus, tremendous values. Timing of a rebound
is the big question, and it depends to a large extent on when most or all of the
negatives are reflected in prices. A significant portion of the cash raised over
the past several months is sitting on the sidelines waiting for an opportunity
to come back into the market. We believe the lower stock and bond prices today
will ultimately result in above-average returns, however time and patience will
be required.
It is vital that we now step back and attempt to look ahead at how we as
investors should respond to this changed landscape. While it is difficult to say
precisely when the markets may improve, we do believe that the majority of the
damage is now behind us. That said, our focus has always been to find excellent
value, but more so than ever, we combine it with an emphasis on seeking
companies having strong financial flexibility and their ability to weather this
storm.
Please visit our website at www.fbpinc.com for information on our firm,
philosophy, investment process and staff. And again, we thank you for your
investment in The Flippin, Bruce & Porter Funds.
/s/ John T. Bruce
John T. Bruce, CFA
President - Portfolio Manager
November 20, 2008
THIS REPORT IS SUBMITTED FOR THE GENERAL INFORMATION OF THE SHAREHOLDERS OF THE
FUNDS. THE REPORT IS NOT AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS IN
THE FUNDS UNLESS IT'S ACCOMPANIED BY A CURRENT PROSPECTUS.
THIS REPORT REFLECTS OUR VIEWS, OPINIONS AND PORTFOLIO HOLDINGS AS OF SEPTEMBER
30, 2008, THE END OF THE REPORTING PERIOD. THESE VIEWS ARE SUBJECT TO CHANGE AT
ANY TIME BASED UPON MARKET OR OTHER CONDITIONS. FOR MORE CURRENT INFORMATION
THROUGHOUT THE YEAR PLEASE VISIT WWW.FBPINC.COM.
3
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]
STANDARD & POOR'S 500 INDEX FBP VALUE FUND CONSUMER PRICE INDEX
- ---------------------------- ------------------ ---------------------
DATE VALUE DATE VALUE DATE VALUE
---- ----- ---- ----- ---- -----
09/30/98 $10,000 09/30/98 $10,000 09/30/98 $10,000
12/31/98 12,130 12/31/98 12,461 12/31/98 10,042
03/31/99 12,734 03/31/99 12,774 03/31/99 10,067
06/30/99 13,632 06/30/99 14,494 06/30/99 10,158
09/30/99 12,780 09/30/99 12,586 09/30/99 10,213
12/31/99 14,682 12/31/99 12,925 12/31/99 10,293
03/31/00 15,019 03/31/00 12,084 03/31/00 10,390
06/30/00 14,620 06/30/00 11,649 06/30/00 10,494
09/30/00 14,478 09/30/00 12,116 09/30/00 10,574
12/31/00 13,345 12/31/00 12,678 12/31/00 10,653
03/31/01 11,763 03/31/01 12,951 03/31/01 10,758
06/30/01 12,452 06/30/01 13,911 06/30/01 10,874
09/30/01 10,624 09/30/01 12,225 09/30/01 10,862
12/31/01 11,759 12/31/01 14,121 12/31/01 10,856
03/31/02 11,791 03/31/02 14,141 03/31/02 10,880
06/30/02 10,212 06/30/02 12,339 06/30/02 11,002
09/30/02 8,447 09/30/02 10,261 09/30/02 11,057
12/31/02 9,160 12/31/02 11,056 12/31/02 11,094
03/31/03 8,872 03/31/03 10,378 03/31/03 11,204
06/30/03 10,237 06/30/03 12,431 06/30/03 11,228
09/30/03 10,508 09/30/03 12,999 09/30/03 11,296
12/31/03 11,788 12/31/03 14,585 12/31/03 11,290
03/31/04 11,987 03/31/04 15,214 03/31/04 11,394
06/30/04 12,194 06/30/04 15,393 06/30/04 11,572
09/30/04 11,966 09/30/04 14,835 09/30/04 11,596
12/31/04 13,071 12/31/04 16,162 12/31/04 11,688
03/31/05 12,790 03/31/05 15,921 03/31/05 11,829
06/30/05 12,965 06/30/05 16,291 06/30/05 11,990
09/30/05 13,432 09/30/05 16,564 09/30/05 12,113
12/31/05 13,713 12/31/05 17,108 12/31/05 12,187
03/31/06 14,290 03/31/06 17,837 03/31/06 12,256
06/30/06 14,084 06/30/06 17,622 06/30/06 12,490
09/30/06 14,882 09/30/06 18,957 09/30/06 12,576
12/31/06 15,879 12/31/06 20,130 12/31/06 12,427
03/31/07 15,980 03/31/07 19,900 03/31/07 12,550
06/30/07 16,983 06/30/07 21,088 06/30/07 12,825
09/30/07 17,328 09/30/07 20,635 09/30/07 12,823
12/31/07 16,751 12/31/07 18,722 12/31/07 12,962
03/31/08 15,169 03/31/08 16,651 03/31/08 13,056
06/30/08 14,754 06/30/08 14,969 06/30/08 13,360
09/30/08 13,520 09/30/08 14,646 09/30/08 13,511
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
4
THE FLIPPIN, BRUCE & PORTER FUNDS
COMPARATIVE PERFORMANCE CHARTS
(UNAUDITED) (CONTINUED)
================================================================================
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]
STANDARD & POOR'S 500 INDEX FBP BALANCED FUND CONSUMER PRICE INDEX
- ---------------------------- ------------------ ---------------------
DATE VALUE DATE VALUE DATE VALUE
---- ----- ---- ----- ---- -----
09/30/98 $10,000 09/30/98 $10,000 09/30/98 $10,000
12/31/98 12,130 12/31/98 11,644 12/31/98 10,042
03/31/99 12,734 03/31/99 11,979 03/31/99 10,067
06/30/99 13,632 06/30/99 13,031 06/30/99 10,158
09/30/99 12,780 09/30/99 11,840 09/30/99 10,213
12/31/99 14,682 12/31/99 12,262 12/31/99 10,293
03/31/00 15,019 03/31/00 11,754 03/31/00 10,390
06/30/00 14,620 06/30/00 11,394 06/30/00 10,494
09/30/00 14,478 09/30/00 11,853 09/30/00 10,574
12/31/00 13,345 12/31/00 12,391 12/31/00 10,653
03/31/01 11,763 03/31/01 12,617 03/31/01 10,758
06/30/01 12,452 06/30/01 13,253 06/30/01 10,874
09/30/01 10,624 09/30/01 12,338 09/30/01 10,862
12/31/01 11,759 12/31/01 13,621 12/31/01 10,856
03/31/02 11,791 03/31/02 13,591 03/31/02 10,880
06/30/02 10,212 06/30/02 12,408 06/30/02 11,002
09/30/02 8,447 09/30/02 11,070 09/30/02 11,057
12/31/02 9,160 12/31/02 11,751 12/31/02 11,094
03/31/03 8,872 03/31/03 11,395 03/31/03 11,204
06/30/03 10,237 06/30/03 13,034 06/30/03 11,228
09/30/03 10,508 09/30/03 13,470 09/30/03 11,296
12/31/03 11,788 12/31/03 14,679 12/31/03 11,290
03/31/04 11,987 03/31/04 15,177 03/31/04 11,394
06/30/04 12,194 06/30/04 15,270 06/30/04 11,572
09/30/04 11,966 09/30/04 14,885 09/30/04 11,596
12/31/04 13,071 12/31/04 15,859 12/31/04 11,688
03/31/05 12,790 03/31/05 15,663 03/31/05 11,829
06/30/05 12,965 06/30/05 15,929 06/30/05 11,990
09/30/05 13,432 09/30/05 16,116 09/30/05 12,113
12/31/05 13,713 12/31/05 16,519 12/31/05 12,187
03/31/06 14,290 03/31/06 17,042 03/31/06 12,256
06/30/06 14,084 06/30/06 16,950 06/30/06 12,490
09/30/06 14,882 09/30/06 17,925 09/30/06 12,576
12/31/06 15,879 12/31/06 18,776 12/31/06 12,427
03/31/07 15,980 03/31/07 18,695 03/31/07 12,550
06/30/07 16,983 06/30/07 19,554 06/30/07 12,825
09/30/07 17,328 09/30/07 19,365 09/30/07 12,823
12/31/07 16,751 12/31/07 18,252 12/31/07 12,962
03/31/08 15,169 03/31/08 16,962 03/31/08 13,056
06/30/08 14,754 06/30/08 15,784 06/30/08 13,360
09/30/08 13,520 09/30/08 15,612 09/30/08 13,511
PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS (a)
(FOR PERIODS ENDED SEPTEMBER 30, 2008)
1 YEAR 5 YEARS 10 YEARS
------ ------- --------
FBP Value Fund -29.02% 2.42% 3.89%
FBP Balanced Fund -19.38% 2.99% 4.56%
Standard & Poor's 500 Index -21.98% 5.17% 3.06%
Consumer Price Index 5.37% 3.65% 3.05%
- --------------------------------------------------------------------------------
(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
reflect the deduction of taxes a shareholder would pay on Funds
distributions or the redemption of Fund shares.
5
FBP VALUE FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
GENERAL INFORMATION
- --------------------------------------------------
Net Asset Value Per share $18.32
Total Net assets (Millions) $33.8
Current Expense Ratio 1.07%
Portfolio Turnover 8%
Fund Inception Date 7/30/93
FBP VALUE S&P 500
STOCK CHARACTERISTICS FUND INDEX
- -------------------------------------------------------------
Number of Stocks 42 500
Weighted Avg Market
Capitalization (Billions) 82.3 86.3
Price-to-Earnings Ratio
(IBES 1 Yr. Forecast EPS) 12.5 11.9
Price-to-Book Value 1.9 2.2
ASSET ALLOCATION
- --------------------------------------------------
[PIE CHART OMITTED]
Stocks 99.1%
Cash Equivalents 0.9%
SECTOR DIVERSIFICATION VS. THE S&P 500 INDEX
- -------------------------------------------------------------
[BAR CHART OMITTED] (% OF NET ASSETS)
FBP VALUE FUND S&P 500 INDEX
-------------- -------------
Consumer Discretionary 14.5% 8.5%
Consumer Staples 8.8% 12.2%
Energy 4.7% 13.4%
Financials 20.0% 15.9%
Health Care 17.5% 13.1%
Industrials 13.2% 11.1%
Information Technology 18.4% 16.0%
Materials 2.0% 3.4%
Telecommunication Services 0.0% 3.0%
Utilities 0.0% 3.6%
Cash Equivalents 0.9% 0.0%
TEN LARGEST EQUITY HOLDINGS % OF NET ASSETS
- -------------------------------------------------------
Bank of America Corporation 5.1%
International Business Machines Corporation 4.8%
JPMorgan Chase & Company 4.7%
Wal-Mart Stores, Inc. 4.6%
Johnson & Johnson 3.7%
Amgen, Inc. 3.5%
Pfizer, Inc. 3.4%
Travelers Companies, Inc. (The) 3.2%
General Electric Company 3.1%
Masco Corporation 3.1%
6
FBP BALANCED FUND
PORTFOLIO INFORMATION
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
GENERAL INFORMATION
- --------------------------------------------------
Net Asset Value Per share $14.41
Total Net assets (Millions) $46.7
Current Expense Ratio 1.00%
Portfolio Turnover 11%
Fund Inception Date 7/3/89
ASSET ALLOCATION
- --------------------------------------------------
[PIE CHART OMITTED]
Cash Equivalents 3.3%
Fixed Income 28.6%
Stocks 68.1%
STOCK PORTFOLIO (68.1% OF FUND)
- --------------------------------------------------
Number of Stocks 42
Weighted Avg Market
Capitalization (Billions) 83.6
Price-to-Earnings Ratio
(IBES 1 Yr. Forecast EPS) 12.5
Price-to-Book Value 1.9
FIVE LARGEST SECTORS % OF NET ASSETS
- -------------------------------------------------------
Financials 14.1%
Information Technology 12.8%
Health Care 11.9%
Consumer Discretionary 9.5%
Industrials 8.5%
TEN LARGEST EQUITY HOLDINGS % OF NET ASSETS
- -------------------------------------------------------
JPMorgan Chase & Company 3.5%
Wal-Mart Stores, Inc. 3.3%
International Business
Machines Corporation 3.3%
Bank of America Corporation 3.0%
Pfizer, Inc. 2.6%
Johnson & Johnson 2.5%
Amgen, Inc. 2.3%
General Electric Company 2.2%
Northern Trust Company, 7.10%,
due 08/01/2009 2.1%
Cisco Systems, Inc. 2.1%
FIXED INCOME PORTFOLIO (28.6% OF FUND)
- --------------------------------------------------
Number of Fixed Income Securities 18
Average Quality A
Average Stated Maturity 1.7
Average Effective Duration 1.6
SECTOR BREAKDOWN % OF NET ASSETS
- -------------------------------------------------------
U.S. Treasury 1.7%
Government Agency 7.6%
Corporate 19.3%
7
FBP VALUE FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 99.1% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 14.5%
20,000 Best Buy Company, Inc. ............................ $ 750,000
27,000 Family Dollar Stores, Inc. ........................ 639,900
34,300 General Motors Corporation ........................ 324,135
29,400 Home Depot, Inc. (The) ............................ 761,166
25,500 KB Home ........................................... 501,840
19,600 Kohl's Corporation (a) ............................ 903,168
26,500 Macy's, Inc. ...................................... 476,470
34,300 Wyndham Worldwide Corporation ..................... 538,853
------------
4,895,532
------------
CONSUMER STAPLES -- 8.8%
18,000 CVS Caremark Corporation .......................... 605,880
7,800 Kimberly-Clark Corporation ........................ 505,752
26,000 Wal-Mart Stores, Inc. ............................. 1,557,140
10,000 Walgreen Company .................................. 309,600
------------
2,978,372
------------
ENERGY -- 4.7%
18,000 BJ Services Company ............................... 344,340
15,600 Pioneer Natural Resources Company (b) ............. 815,568
7,400 Royal Dutch Shell PLC - ADR - Class A ............. 436,674
------------
1,596,582
------------
FINANCIALS -- 20.0%
15,000 American Express Company .......................... 531,450
32,700 American International Group, Inc. ................ 108,891
49,000 Bank of America Corporation ....................... 1,715,000
40,000 Citigroup, Inc. ................................... 820,400
3,000 Comerica, Inc. .................................... 98,370
34,000 JPMorgan Chase & Company .......................... 1,587,800
19,000 Lincoln National Corporation ...................... 813,390
24,000 Travelers Companies, Inc. (The) ................... 1,084,800
------------
6,760,101
------------
HEALTH CARE -- 17.5%
19,800 Amgen, Inc. (a) ................................... 1,173,546
18,000 Johnson & Johnson ................................. 1,247,040
17,500 Merck & Company, Inc. ............................. 552,300
63,000 Pfizer, Inc. ...................................... 1,161,720
29,000 Watson Pharmaceuticals, Inc. (a) .................. 826,500
20,600 WellPoint, Inc. (a) ............................... 963,462
------------
5,924,568
------------
INDUSTRIALS -- 13.2%
17,600 Avery Dennison Corporation ........................ 782,848
10,100 FedEx Corporation ................................. 798,304
41,000 General Electric Company .......................... 1,045,500
25,000 Ingersoll-Rand Company Ltd. - Class A ............. 779,250
58,000 Masco Corporation ................................. 1,040,520
------------
4,446,422
------------
8
FBP VALUE FUND
SCHEDULE OF INVESTMENTS
================================================================================
SHARES COMMON STOCKS -- 99.1% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY -- 18.4%
45,000 Cisco Systems, Inc. (a) ........................... $ 1,015,200
19,000 Computer Sciences Corporation (a) ................. 762,470
39,000 Dell, Inc. (a) .................................... 642,720
95,818 Flextronics International Ltd. (a) ................ 678,391
19,000 Hewlett-Packard Company ........................... 878,560
14,000 International Business Machines Corporation ....... 1,637,440
23,000 Microsoft Corporation ............................. 613,870
------------
6,228,651
------------
MATERIALS -- 2.0%
30,000 Sealed Air Corporation ............................ 659,700
------------
TOTAL COMMON STOCKS (Cost $30,990,457) ............ $ 33,489,928
------------
================================================================================
SHARES MONEY MARKET FUNDS -- 2.8% VALUE
- --------------------------------------------------------------------------------
960,478 Fidelity Institutional Money Market Government
Portfolio - Class I, 2.187% (c) (Cost $960,478) ... $ 960,478
------------
TOTAL INVESTMENTS AT VALUE -- 101.9%
(Cost $31,950,935) .............................. $ 34,450,406
LIABILITIES IN EXCESS OF OTHER ASSETS -- (1.9%) ... (658,937)
------------
NET ASSETS -- 100.0% .............................. $ 33,791,469
============
(a) Non-income producing security.
(b) Security covers a written call option.
(c) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
ADR - American Depositary Receipt
See accompanying notes to financial statements.
9
FBP VALUE FUND
SCHEDULE OF OPEN OPTION CONTRACTS
SEPTEMBER 30, 2008 (UNAUDITED)
============================================================================================
OPTION VALUE OF PREMIUMS
CONTRACTS COVERED CALL OPTIONS OPTIONS RECEIVED
- --------------------------------------------------------------------------------------------
50 Pioneer Natural Resources Company, 12/20/2008 at $85 ... $ 1,250 $ 33,509
50 Pioneer Natural Resources Company, 01/17/2009 at $70 ... 7,500 34,163
------- ---------
$ 8,750 $ 67,672
======= =========
See accompanying notes to financial statements.
10
FBP BALANCED FUND
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2008 (UNAUDITED)
================================================================================
SHARES COMMON STOCKS -- 68.1% VALUE
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY -- 9.5%
17,000 Best Buy Company, Inc. ............................ $ 637,500
25,000 Family Dollar Stores, Inc. ........................ 592,500
26,000 General Motors Corporation ........................ 245,700
26,000 Home Depot, Inc. (The) ............................ 673,140
28,000 KB Home ........................................... 551,040
16,000 Kohl's Corporation (a) ............................ 737,280
32,000 Macy's, Inc. ...................................... 575,360
28,000 Wyndham Worldwide Corporation ..................... 439,880
------------
4,452,400
------------
CONSUMER STAPLES -- 6.5%
20,000 CVS Caremark Corporation .......................... 673,200
7,700 Kimberly-Clark Corporation ........................ 499,268
26,000 Wal-Mart Stores, Inc. ............................. 1,557,140
10,000 Walgreen Company .................................. 309,600
------------
3,039,208
------------
ENERGY -- 3.3%
17,200 BJ Services Company ............................... 329,036
17,000 Pioneer Natural Resources Company (b) ............. 888,760
5,300 Royal Dutch Shell PLC - ADR - Class A ............. 312,753
------------
1,530,549
------------
FINANCIALS -- 14.1%
18,000 American Express Company .......................... 637,740
27,500 American International Group, Inc. ................ 91,575
40,000 Bank of America Corporation ....................... 1,400,000
45,000 Citigroup, Inc. ................................... 922,950
5,000 Comerica, Inc. .................................... 163,950
35,000 JPMorgan Chase & Company .......................... 1,634,500
18,700 Lincoln National Corporation ...................... 800,547
21,000 Travelers Companies, Inc. (The) ................... 949,200
------------
6,600,462
------------
HEALTH CARE -- 11.9%
18,000 Amgen, Inc. (a) ................................... 1,066,860
17,000 Johnson & Johnson ................................. 1,177,760
15,600 Merck & Company, Inc. ............................. 492,336
65,000 Pfizer, Inc. ...................................... 1,198,600
26,000 Watson Pharmaceuticals, Inc. (a) .................. 741,000
18,500 WellPoint, Inc. (a) ............................... 865,245
------------
5,541,801
------------
INDUSTRIALS -- 8.5%
15,500 Avery Dennison Corporation ........................ 689,440
7,400 FedEx Corporation ................................. 584,896
40,000 General Electric Company .......................... 1,020,000
24,500 Ingersoll-Rand Company Ltd. - Class A ............. 763,665
50,000 Masco Corporation ................................. 897,000
------------
3,955,001
------------
11
FBP BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES COMMON STOCKS -- 68.1% (CONTINUED) VALUE
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY -- 12.8%
43,000 Cisco Systems, Inc. (a) ........................... $ 970,080
19,000 Computer Sciences Corporation (a) ................. 762,470
38,000 Dell, Inc. (a) .................................... 626,240
88,000 Flextronics International Ltd. (a) ................ 623,040
16,000 Hewlett-Packard Company ........................... 739,840
13,000 International Business Machines Corporation ....... 1,520,480
27,000 Microsoft Corporation ............................. 720,630
------------
5,962,780
------------
MATERIALS -- 1.5%
32,000 Sealed Air Corporation ............................ 703,680
------------
TOTAL COMMON STOCKS (Cost $27,226,200) ............ $ 31,785,881
------------
================================================================================
PAR VALUE U.S. GOVERNMENT AND AGENCY OBLIGATIONS -- 9.3% VALUE
- --------------------------------------------------------------------------------
U.S. TREASURY NOTES -- 1.7%
$ 750,000 4.50%, due 11/15/2010 ........................... $ 789,668
------------
FEDERAL HOME LOAN BANK -- 6.0%
500,000 4.035%, due 03/09/2009 .......................... 501,995
750,000 4.375%, due 03/17/2010 .......................... 761,629
750,000 4.375%, due 10/22/2010 .......................... 763,841
750,000 5.05%, due 08/24/2011 ........................... 760,524
------------
2,787,989
------------
FEDERAL HOME LOAN MORTGAGE CORPORATION -- 1.6%
750,000 5.25%, due 10/06/2011 ........................... 750,244
------------
TOTAL U.S. GOVERNMENT AND AGENCY OBLIGATIONS
(Cost $4,285,366) ............................... $ 4,327,901
------------
12
FBP BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
PAR VALUE CORPORATE BONDS -- 19.3% VALUE
- --------------------------------------------------------------------------------
FINANCIALS -- 6.5%
Credit Suisse First Boston USA, Inc.,
$ 750,000 4.70%, due 06/01/2009 ........................... $ 741,671
International Lease Finance Corporation,
750,000 5.40%, due 02/15/2012 ........................... 556,069
Northern Trust Company,
1,000,000 7.10%, due 08/01/2009 ........................... 1,008,236
Prudential Financial, Inc.,
750,000 5.80%, due 06/15/2012 ........................... 747,444
------------
3,053,420
------------
HEALTH CARE -- 1.6%
UnitedHealth Group, Inc.
750,000 5.25%, due 03/15/2011 ........................... 745,643
------------
INDUSTRIALS -- 8.0%
Donnelley (R.R.) & Sons Company,
750,000 3.75%, due 04/01/2009 ........................... 739,477
Kraft Foods, Inc.,
750,000 5.625%, due 11/01/2011 .......................... 752,796
Newell Rubbermaid, Inc.,
750,000 4.625%, due 12/15/2009 .......................... 745,727
Ryder System, Inc.,
750,000 5.00%, due 04/01/2011 ........................... 739,486
Union Pacific Corporation,
750,000 3.625%, due 06/01/2010 .......................... 739,415
------------
3,716,901
------------
UTILITIES -- 3.2%
Ohio Power Company,
750,000 5.30%, due 11/01/2010 ........................... 754,590
Public Service Electric & Gas Company,
750,000 4.00%, due 11/01/2008 ........................... 748,935
------------
1,503,525
------------
TOTAL CORPORATE BONDS (Cost $9,232,946) ........... $ 9,019,489
------------
13
FBP BALANCED FUND
SCHEDULE OF INVESTMENTS (CONTINUED)
================================================================================
SHARES MONEY MARKET FUNDS -- 4.3% VALUE
- --------------------------------------------------------------------------------
2,014,727 Fidelity Institutional Money Market Government
Portfolio - Class I, 2.187% (c) (Cost $2,014,727) $ 2,014,727
------------
TOTAL INVESTMENTS AT VALUE -- 101.0%
(Cost $42,759,239) .............................. $ 47,147,998
LIABILITIES IN EXCESS OF OTHER ASSETS -- (1.0%) .. (483,855)
------------
NET ASSETS -- 100.0% .............................. $ 46,664,143
============
(a) Non-income producing security.
(b) Security covers a written call option.
(c) Variable rate security. The rate shown is the 7-day effective yield as of
September 30, 2008.
ADR - American Depositary Receipt
See accompanying notes to financial statements.
FBP BALANCED FUND
SCHEDULE OF OPEN OPTION CONTRACTS
SEPTEMBER 30, 2008 (UNAUDITED)
============================================================================================
OPTION VALUE OF PREMIUMS
CONTRACTS COVERED CALL OPTIONS OPTIONS RECEIVED
- --------------------------------------------------------------------------------------------
40 Pioneer Natural Resources Company, 12/20/2008 at $85 $ 1,000 $ 26,807
40 Pioneer Natural Resources Company, 01/17/2009 at $60 13,200 24,194
40 Pioneer Natural Resources Company, 01/17/2009 at $70 6,000 27,284
------- ---------
$20,200 $ 78,285
======= =========
See accompanying notes to financial statements.
14
THE FLIPPIN, BRUCE & PORTER FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2008 (UNAUDITED)
=========================================================================================
FBP FBP
VALUE BALANCED
FUND FUND
- -----------------------------------------------------------------------------------------
ASSETS
Investments in securities:
At acquisition cost ................................. $ 31,950,935 $ 42,759,239
============ ============
At value (Note 1) ................................... $ 34,450,406 $ 47,147,998
Dividends and interest receivable ..................... 42,710 250,215
Receivable for capital shares sold .................... 925 4,181
Other assets .......................................... 8,427 5,248
------------ ------------
TOTAL ASSETS ........................................ 34,502,468 47,407,642
------------ ------------
LIABILITIES
Distributions payable ................................. 3,058 21,645
Payable for investment securities purchased ........... 663,450 647,749
Payable for capital shares redeemed ................... 1,519 11,113
Accrued investment advisory fees (Note 3) ............. 20,388 26,943
Payable to Administrator (Note 3) ..................... 4,200 5,500
Accrued compliance fees (Note 3) ...................... 700 700
Other accrued expenses and liabilities ................ 8,934 9,649
Covered call options, at value (Notes 1 and 4)
(premiums received $67,672 and $78,285, respectively) 8,750 20,200
------------ ------------
TOTAL LIABILITIES ................................... 710,999 743,499
------------ ------------
NET ASSETS ............................................... $ 33,791,469 $ 46,664,143
============ ============
Net assets consist of:
Paid-in capital ....................................... $ 32,966,244 $ 43,490,614
Accumulated undistributed net investment income.. ..... 7,737 48,367
Accumulated net realized losses from
security transactions ............................... (1,740,905) (1,321,682)
Net unrealized appreciation on investments ............ 2,558,393 4,446,844
------------ ------------
Net assets ............................................... $ 33,791,469 $ 46,664,143
============ ============
Shares of beneficial interest outstanding
(unlimited number of shares authorized, no par value) . 1,845,000 3,238,840
============ ============
Net asset value, offering price and redemption
price per share (Note 1) .............................. $ 18.32 $ 14.41
============ ============
See accompanying notes to financial statements.
15
THE FLIPPIN, BRUCE & PORTER FUNDS
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2008 (UNAUDITED)
===================================================================================
FBP FBP
VALUE BALANCED
FUND FUND
- -----------------------------------------------------------------------------------
INVESTMENT INCOME
Interest ........................................ $ -- $ 473,187
Dividends ....................................... 495,040 354,264
------------ ------------
TOTAL INVESTMENT INCOME ....................... 495,040 827,451
------------ ------------
EXPENSES
Investment advisory fees (Note 3) ............... 138,035 181,347
Administration fees (Note 3) .................... 27,719 35,414
Professional fees ............................... 8,004 8,703
Trustees' fees and expenses ..................... 8,147 8,147
Registration fees ............................... 6,580 3,705
Postage and supplies ............................ 5,227 4,392
Compliance fees and expenses (Note 3) ........... 4,754 4,751
Custodian and bank service fees ................. 4,828 4,144
Insurance expense ............................... 1,834 2,271
Printing of shareholder reports ................. 2,061 1,358
Other expenses .................................. 3,687 5,929
------------ ------------
TOTAL EXPENSES ................................ 210,876 260,161
------------ ------------
NET INVESTMENT INCOME .............................. 284,164 567,290
------------ ------------
REALIZED AND UNREALIZED LOSSES
ON INVESTMENTS
Net realized losses on security transactions .... (1,636,424) (1,227,220)
Net realized losses on option contracts written.. (81,358) --
Net change in unrealized appreciation/
depreciation on investments ................... (3,508,763) (3,671,259)
------------ ------------
NET REALIZED AND UNREALIZED LOSSES
ON INVESTMENTS .................................. (5,226,545) (4,898,479)
------------ ------------
NET DECREASE IN NET ASSETS
FROM OPERATIONS ................................. $ (4,942,381) $ (4,331,189)
============ ============
See accompanying notes to financial statements.
16
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
2008 MARCH 31, 2008 MARCH 31,
(UNAUDITED) 2008 (UNAUDITED) 2008
- -------------------------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income ................ $ 284,164 $ 679,283 $ 567,290 $ 1,321,239
Net realized gains (losses) on:
Security transactions .............. (1,636,424) 3,349,834 (1,227,220) 3,294,326
Option contracts written ........... (81,358) 119,265 -- 112,605
In-kind redemptions (Note 1). ...... -- 370,882 -- --
Net change in unrealized appreciation/
depreciation on investments.. ...... (3,508,763) (13,281,533) (3,671,259) (10,396,097)
------------ ------------ ------------ ------------
Net decrease in net assets
from operations ...................... (4,942,381) (8,762,269) (4,331,189) (5,667,927)
------------ ------------ ------------ ------------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment income ........... (276,427) (687,582) (564,589) (1,357,079)
From realized capital gains on
security transactions .............. -- (3,492,371) -- (3,501,622)
Return of capital .................... -- (393,309) -- (219,267)
------------ ------------ ------------ ------------
Decrease in net assets from
distributions to shareholders.. ...... (276,427) (4,573,262) (564,589) (5,077,968)
------------ ------------ ------------ ------------
FROM CAPITAL
SHARE TRANSACTIONS
Proceeds from shares sold ............ 1,027,477 3,160,085 582,961 3,637,669
Net asset value of shares issued in
reinvestment of distributions
to shareholders .................... 269,419 4,441,138 512,506 4,737,391
Payments for shares redeemed ......... (5,358,145) (11,427,076) (4,530,669) (8,991,631)
------------ ------------ ------------ ------------
Net decrease in net assets
fromcapital share transactions. ...... (4,061,249) (3,825,853) (3,435,202) (616,571)
------------ ------------ ------------ ------------
TOTAL DECREASE
IN NET ASSETS ........................ (9,280,057) (17,161,384) (8,330,980) (11,362,466)
NET ASSETS
Beginning of period .................. 43,071,526 60,232,910 54,995,123 66,357,589
------------ ------------ ------------ ------------
End of period ........................ $ 33,791,469 $ 43,071,526 $ 46,664,143 $ 54,995,123
============ ============ ============ ============
ACCUMULATED UNDISTRIBUTED
NET INVESTMENT INCOME ................ $ 7,737 $ -- $ 48,367 $ 45,666
============ ============ ============ ============
CAPITAL SHARE ACTIVITY
Sold ................................. 51,548 121,432 37,853 196,696
Reinvested ........................... 14,519 173,994 35,277 265,687
Redeemed ............................. (272,661) (450,272) (305,166) (493,053)
------------ ------------ ------------ ------------
Net decrease in shares outstanding ... (206,594) (154,846) (232,036) (30,670)
Shares outstanding at
beginning of period ................ 2,051,594 2,206,440 3,470,876 3,501,546
------------ ------------ ------------ ------------
Shares outstanding at end of period .. 1,845,000 2,051,594 3,238,840 3,470,876
============ ============ ============ ============
See accompanying notes to financial statements.
17
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,
2008 ------------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- ----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 20.99 $ 27.30 $ 26.60 $ 25.73 $ 24.86 $ 17.12
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.15 0.32 0.33 0.32 0.29 0.22
Net realized and unrealized gains
(losses) on investments ............. (2.68) (4.43) 2.71 2.70 0.86 7.74
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ (2.53) (4.11) 3.04 3.02 1.15 7.96
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.14) (0.32) (0.33) (0.32) (0.28) (0.22)
Distributions from net realized gains . -- (1.68) (2.01) (1.83) -- --
Return of capital ..................... -- (0.20) -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.14) (2.20) (2.34) (2.15) (0.28) (0.22)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 18.32 $ 20.99 $ 27.30 $ 26.60 $ 25.73 $ 24.86
========== ========== ========== ========== ========== ==========
Total return (a) ........................ (12.04%)(b) (16.33%) 11.57% 12.03% 4.65% 46.60%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 33,791 $ 43,072 $ 60,233 $ 59,611 $ 61,212 $ 50,400
========== ========== ========== ========== ========== ==========
Ratio of expenses to average net assets . 1.07%(c) 1.01% 1.01% 1.01% 1.00% 1.02%
Ratio of net investment income to
average net assets .................... 1.44%(c) 1.21% 1.19% 1.17% 1.17% 0.94%
Portfolio turnover rate ................. 8%(b) 26% 16% 15% 15% 19%
(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
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,
2008 ------------------------------------------------------------------
(UNAUDITED) 2008 2007 2006 2005 2004
- ----------------------------------------------------------------------------------------------------------------------------
Net asset value at beginning of period .. $ 15.84 $ 18.95 $ 18.39 $ 18.06 $ 18.40 $ 14.46
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income ................. 0.17 0.38 0.37 0.33 0.29 0.29
Net realized and unrealized gains
(losses) on investments ............. (1.43) (2.01) 1.39 1.22 0.28 4.49
---------- ---------- ---------- ---------- ---------- ----------
Total from investment operations ........ (1.26) (1.63) 1.76 1.55 0.57 4.78
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income .. (0.17) (0.39) (0.37) (0.32) (0.30) (0.31)
Distributions from net realized gains . -- (1.02) (0.83) (0.90) (0.61) (0.53)
Return of capital ..................... -- (0.07) -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total distributions ..................... (0.17) (1.48) (1.20) (1.22) (0.91) (0.84)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value at end of period ........ $ 14.41 $ 15.84 $ 18.95 $ 18.39 $ 18.06 $ 18.40
========== ========== ========== ========== ========== ==========
Total return (a) ........................ (7.96%)(b) (9.27%) 9.70% 8.81% 3.20% 33.19%
========== ========== ========== ========== ========== ==========
Net assets at end of period (000's) ..... $ 46,664 $ 54,995 $ 66,358 $ 62,781 $ 61,466 $ 58,290
========== ========== ========== ========== ========== ==========
Ratio of expenses to average net assets . 1.00%(c) 0.96% 0.97% 0.99% 0.96% 0.98%
Ratio of net investment income to
average net assets .................... 2.18%(c) 2.05% 1.95% 1.75% 1.62% 1.68%
Portfolio turnover rate ................. 11%(b) 29% 17% 24% 17% 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.
19
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2008 (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, as amended. 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. 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.
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.
The Financial Accounting Standards Board's ("FASB") Statement of Financial
Accounting Standards (SFAS) No. 157 "Fair Value Measurements" 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. 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.
Various inputs are used in determining the value of each Fund's investments.
These inputs are summarized in the three broad levels listed below:
o Level 1 - quoted prices in active markets for identical securities
o Level 2 - other significant observable inputs
o Level 3 - significant unobservable inputs
20
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.
The following is a summary of the inputs used to value each Fund's net assets as
of September 30, 2008:
- --------------------------------------------------------------------------------
FBP FBP
VALUE FUND BALANCED FUND
- --------------------------------------------------------------------------------
Level 1 - Quoted prices .......................... $ 34,441,656 $ 33,780,408
Level 2 - Other significant observable inputs .... -- 13,347,390
------------ ------------
Total ............................................ $ 34,441,656 $ 47,127,798
============ ============
- --------------------------------------------------------------------------------
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 -- Each Fund may enter into repurchase agreements. A
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 a Fund enters into a repurchase agreement, the Fund takes 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, the Funds
actively monitor and seek additional collateral, as needed. If the seller
defaults, and the fair value of the collateral declines, realization of the
collateral by the Funds may be delayed or limited.
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.
The tax character of distributions paid during the periods ended September 30,
2008 and March 31, 2008 are as follows:
- --------------------------------------------------------------------------------
ORDINARY LONG-TERM RETURN OF TOTAL
PERIOD ENDED INCOME CAPITAL GAINS CAPITAL DISTRIBUTIONS
- --------------------------------------------------------------------------------
FBP Value Fund
09/30/08 .............. $ 276,427 $ -- $ -- $ 276,427
03/31/08 .............. $ 699,173 $3,480,780 $ 393,309 $4,573,262
- --------------------------------------------------------------------------------
FBP Balanced Fund
09/30/08 .............. $ 564,589 $ -- $ -- $ 564,589
03/31/08 .............. $1,403,338 $3,455,363 $ 219,267 $5,077,968
- --------------------------------------------------------------------------------
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.
21
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
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 a Fund's 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, 2008:
- --------------------------------------------------------------------------------
FBP FBP
VALUE FUND BALANCED FUND
- --------------------------------------------------------------------------------
Cost of portfolio investments and written options $ 31,883,263 $ 42,636,050
============ ============
Gross unrealized appreciation ................... $ 8,677,856 $ 9,840,947
Gross unrealized depreciation ................... (6,119,463) (5,349,199)
------------ ------------
Net unrealized appreciation ..................... 2,558,393 4,491,748
Accumulated ordinary income ..................... 10,795 25,115
Other temporary differences ..................... (3,058) (21,645)
Other losses .................................... (1,740,905) (1,321,689)
------------ ------------
Total distributable earnings .................... $ 825,225 $ 3,173,529
============ ============
- --------------------------------------------------------------------------------
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.
During the year ended March 31, 2008, the FBP Value Fund realized $370,882 of
net capital gains resulting from in-kind redemptions (redemptions in which
shareholders who redeemed Fund shares received securities held by the Fund
rather than cash). The Fund recognizes 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 Fund and
are not required to be distributed to shareholders.
22
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
FASB's Interpretation No. 48 ("FIN 48") "Accounting for Uncertainty in Income
Taxes" 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. As required by FIN 48, management has concluded
that no provision for income tax is required in these financial statements.
2. INVESTMENT TRANSACTIONS
During the six months ended September 30, 2008, cost of purchases and proceeds
from sales and maturities of investment securities, other than short-term
investments and U.S. government securities, amounted to $3,249,987 and
$7,350,790, respectively, for the FBP Value Fund and $5,747,729 and $8,337,613,
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, subject to a minimum monthly fee of $4,000,
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 Funds' 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 the Funds' aggregate net assets in
excess of $100 million. In addition, the Funds reimburse Ultimus for reasonable
out-of-pocket expenses, if any, incurred in connection with these services.
23
THE FLIPPIN, BRUCE & PORTER FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
4. COVERED CALL OPTIONS
A summary of covered call option contracts during the six months ended September
30, 2008 is as follows:
- ------------------------------------------------------------------------------------------
FBP FBP
VALUE FUND BALANCED FUND
------------------------ -----------------------
OPTION OPTION OPTION OPTION
CONTRACTS PREMIUMS CONTRACTS PREMIUMS
- ------------------------------------------------------------------------------------------
Options outstanding at
beginning of period ............. -- $ -- -- $ --
Options written .................... 150 97,914 120 78,285
Options cancelled in a closing
purchase transaction ............ (50) (30,242) -- --
---------- ---------- ---------- ----------
Options outstanding at end of period 100 $ 67,672 120 $ 78,285
========== ========== ========== ==========
- ------------------------------------------------------------------------------------------
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.
24
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 operating
expenses. These ongoing costs, 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 (April 1, 2008) shown and held for the entire
period (September 30, 2008).
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 (March 31, 2008 through
September 30, 2008.)
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.
More information about the Funds' expenses, including annual expense ratios for
the past 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, 2008 September 30, 2008 During Period*
- ---------------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $ 879.60 $5.04
- ---------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,019.70 $5.42
- ---------------------------------------------------------------------------------------
* Expenses are equal to the FBP Value Fund's annualized expense ratio of
1.07% for the period, multiplied by the average account value over the
period, multiplied by 183/365 (to reflect the one-half year period).
25
THE FLIPPIN BRUCE & PORTER FUNDS
ABOUT YOUR FUNDS' EXPENSES (UNAUDITED)
(CONTINUED)
================================================================================
FBP BALANCED FUND
- ---------------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
April 1, 2008 September 30, 2008 During Period*
- ---------------------------------------------------------------------------------------
Based on Actual Fund Return $1,000.00 $920.40 $4.81
- ---------------------------------------------------------------------------------------
Based on Hypothetical 5% Return
(before expenses) $1,000.00 $1,020.05 $5.06
- ---------------------------------------------------------------------------------------
* Expenses are equal to the FBP Balanced Fund's annualized expense ratio of
1.00% 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.
26
This page intentionally left blank.
- --------------------------------------------------------------------------------
THE
FLIPPIN, BRUCE & PORTER
FUNDS
===========================
INVESTMENT ADVISER LEGAL COUNSEL
Flippin, Bruce & Porter, Inc. Sullivan & Worcester LLP
800 Main Street, Second Floor One Post Office Square
P.O. Box 6138 Boston, Massachusetts 02109
Lynchburg, Virginia 24505
TOLL-FREE 1-800-327-9375 OFFICERS
www.fbpinc.com John T. Bruce, President
and Portfolio Manager
ADMINISTRATOR John M. Flippin, Vice President
Ultimus Fund Solutions, LLC R. Gregory Porter, III,
P.O. Box 46707 Vice President
Cincinnati, Ohio 45246-0707 John H. Hanna, IV, Vice President
TOLL-FREE 1-866-738-1127 David J. Marshall, Vice President
CUSTODIAN TRUSTEES
US Bank Austin Brockenbrough, III
425 Walnut Street John T. Bruce
Cincinnati, Ohio 45202 Charles M. Caravati, Jr.
Robert S. Harris
INDEPENDENT REGISTERED J. Finley Lee, Jr.
PUBLIC ACCOUNTING FIRM Richard L. Morrill
Ernst & Young LLP Harris V. Morrissette
1900 Scripps Center Samuel B. Witt, III
312 Walnut Street
Cincinnati, Ohio 45202
- --------------------------------------------------------------------------------
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 November 25, 2008
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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 November 25, 2008
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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 Mid-Cap
Fund and The Alabama Tax Free Bond Fund)
Date November 25, 2008
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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 November 25, 2008
-------------------------
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 November 25, 2008
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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 November 25, 2008
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By (Signature and Title)* /s/ Joseph L. Antrim III
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Joseph L. Antrim III, President
(The Davenport Core Fund)
Date November 25, 2008
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By (Signature and Title)* /s/ Mark J. Seger
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Mark J. Seger, Treasurer
Date November 25, 2008
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* Print the name and title of each signing officer under his or her signature.