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 811-10085
---------
Hillman Capital Management Investment Trust
-------------------------------------------
(Exact name of registrant as specified in charter)
116 South Franklin Street, Post Office Box 69, Rocky Mount, North Carolina 27802
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
C. Frank Watson III
116 South Franklin Street, Post Office Box 69, Rocky Mount, North Carolina 27802
- --------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: 252-972-9922
------------
Date of fiscal year end: September 30, 2004
------------------
Date of reporting period: March 31, 2004
--------------
Item 1. REPORTS TO STOCKHOLDERS.
________________________________________________________________________________
THE HILLMAN AGGRESSIVE
EQUITY FUND
________________________________________________________________________________
a series of the Hillman Capital Management Investment Trust
Semi-Annual Report
(Unaudited)
FOR THE PERIOD ENDED MARCH 31, 2004
INVESTMENT ADVISOR
Hillman Capital Management, Inc.
613 Third Street
Eastport Maritime Building
Annapolis, Maryland 21403
THE HILLMAN AGGRESSIVE EQUITY FUND
116 South Franklin Street
Post Office Drawer 4365
Rocky Mount, North Carolina 27803-0365
1-800-773-3863
This report and the financial statements contained herein are submitted for the
general information of the shareholders of The Hillman Aggressive Equity Fund
(the "Fund"). This report is not authorized for distribution to prospective
investors in the Fund unless preceded or accompanied by an effective prospectus.
Mutual fund shares are not deposits or obligations of, or guaranteed by, any
depository institution. Shares are not insured by the FDIC, Federal Reserve
Board or any other agency, and are subject to investment risks, including
possible loss of principal amount invested. Neither the Fund nor the Fund's
distributor is a bank.
For more information about the Fund, including charges and expenses, call the
Fund for a free prospectus. You should read the prospectus carefully before you
invest or send money.
Distributor: Capital Investment Group, Inc., Post Office Drawer 4365, Rocky
Mount, North Carolina 27803, Phone 1-800-773-3863.
THE HILLMAN AGGRESSIVE EQUITY FUND
PORTFOLIO OF INVESTMENTS
March 31, 2004
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Value
Shares (note 1)
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - 98.27%
Aerospace / Defense - 5.00%
Goodrich Corporation ........................................................ 16,800 $ 471,576
------------
Auto Manufacturers - 5.05%
General Motors Corporation .................................................. 10,100 475,710
------------
Commercial Services - 5.07%
Cendant Corporation ......................................................... 19,600 478,044
------------
Computers - 10.06%
(a)EMC Corporation ............................................................. 34,400 468,184
Hewlett-Packard Company ..................................................... 21,000 479,640
------------
947,824
------------
Electric - 4.93%
American Electric Power Co., Inc. ........................................... 14,100 464,172
------------
Food - 4.53%
Whole Foods Market, Inc. .................................................... 5,700 427,215
------------
Healthcare Services - 10.12%
Aetna Inc. .................................................................. 5,600 502,432
(a)Laboratory Corporation of America Holdings .................................. 11,500 451,375
------------
953,807
------------
Lodging - Hotels - 5.08%
(a)Host Marriott Corporation ................................................... 37,500 479,250
------------
Miscellaneous Manufacturing - 4.99%
General Electric Co. ........................................................ 15,400 470,008
------------
Pharmaceuticals - 5.13%
Pfizer, Inc. ................................................................ 13,800 483,690
------------
Real Estate Investment Trusts - 9.57%
Apartment Investment & Management Company ................................... 14,700 457,023
Equity Office Properties Trust .............................................. 15,400 444,906
------------
901,929
------------
Retail - 8.97%
(a)Finlay Enterprises Inc. ..................................................... 21,900 394,419
Sears, Roebuck and Company .................................................. 10,500 451,080
------------
845,499
------------
(Continued)
THE HILLMAN AGGRESSIVE EQUITY FUND
PORTFOLIO OF INVESTMENTS
March 31, 2004
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Value
Shares (note 1)
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - (Continued)
Telecommunications - 19.77%
(a)Corning Incorporated .................................................... 42,100 $ 470,678
Motorola Incorporated ................................................... 26,900 473,440
SBC Communications, Inc. ................................................ 18,400 451,536
Verizon Communications Inc. ............................................. 12,800 467,712
------------
1,863,366
------------
Total Common Stocks (Cost $7,668,314) ........................................................... 9,262,090
------------
INVESTMENT COMPANY - 1.01%
Evergreen Select Money Market Fund Class I #495 .............................. 94,843 94,843
(Cost $94,843) ------------
Total Value of Investments (Cost $7,763,157 (b)) ................................... 99.28 % $ 9,356,933
Other Assets Less Liabilities ...................................................... 0.72 % 67,876
------------
Net Assets ................................................................... 100.00 % $ 9,424,809
======== ============
(a) Non-income producing investment.
(b) Aggregate cost for financial reporting and federal income tax purposes is the same. Unrealized
appreciation/(depreciation) of investments for financial reporting and federal income tax purposes is as follows:
Unrealized appreciation ................................................................................... $ 1,692,924
Unrealized depreciation ................................................................................... (99,148)
------------
Net unrealized appreciation .................................................................... $ 1,593,776
============
See accompanying notes to financial statements
THE HILLMAN AGGRESSIVE EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
March 31, 2004
(Unaudited)
ASSETS
Investments, at value (cost $7,763,157) ......................................................... $ 9,356,933
Cash ............................................................................................ 56
Income receivable ............................................................................... 18,294
Receivable for fund shares sold ................................................................. 52,700
Other asset ..................................................................................... 13,523
------------
Total assets ............................................................................... 9,441,506
------------
LIABILITIES
Accrued expenses ................................................................................ 16,697
------------
NET ASSETS
(applicable to 818,560 shares outstanding; unlimited
shares of no par value beneficial interest authorized) ......................................... $ 9,424,809
============
NET ASSET VALUE, REDEMPTION AND OFFERING PRICE PER SHARE
($9,424,809 / 818,560 shares) ................................................................... $ 11.51
============
NET ASSETS CONSIST OF
Paid-in capital ................................................................................. $ 8,087,056
Undistributed net investment income ............................................................. 15,284
Accumulated net realized loss on investments .................................................... (271,307)
Net unrealized appreciation on investments ...................................................... 1,593,776
------------
$ 9,424,809
============
See accompanying notes to financial statements
THE HILLMAN AGGRESSIVE EQUITY FUND
STATEMENT OF OPERATIONS
Period ended March 31, 2004
(Unaudited)
NET INVESTMENT INCOME
Income
Dividends .................................................................................... $ 68,337
------------
Expenses
Investment advisory fees (note 2) ............................................................ 34,205
Fund administration fees (note 2) ............................................................ 4,276
Distribution and service fees (note 3) ....................................................... 8,551
Custody fees (note 2) ........................................................................ 2,377
Fund accounting fees (note 2) ................................................................ 13,879
Audit and tax preparation fees ............................................................... 6,762
Legal fees ................................................................................... 5,999
Securities pricing fees ...................................................................... 882
Other accounting fees (note 2) ............................................................... 7,724
Shareholder servicing expenses ............................................................... 1,006
Registration and filing expenses ............................................................. 4,628
Printing expenses ............................................................................ 46
Trustee fees and meeting expenses ............................................................ 2,990
Other operating expenses ..................................................................... 1,499
------------
Total expenses ........................................................................... 94,824
------------
Less:
Investment advisory fees waived (note 2) ............................................ (18,009)
Fund administration fees waived (note 2) ............................................ (4,276)
Fund accounting fees waived (note 2) ................................................ (11,629)
Other accounting fees waived (note 2) ............................................... (7,724)
------------
Net expenses ............................................................................. 53,186
------------
Net investment income ............................................................... 15,151
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized loss from investment transactions .................................................... (93,541)
Change in unrealized appreciation on investments .................................................. 1,100,923
------------
Net realized and unrealized gain on investments .............................................. 1,007,382
------------
Net increase in net assets resulting from operations ..................................... $ 1,022,533
============
See accompanying notes to financial statements
THE HILLMAN AGGRESSIVE EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
Period ended Year ended
March 31, September 30,
2004 (a) 2003
- ------------------------------------------------------------------------------------------------------------------------------------
INCREASE IN NET ASSETS
Operations
Net investment income ............................................................. $ 15,151 $ 20,446
Net realized loss from investment transactions .................................... (93,541) (87,727)
Change in unrealized appreciation on investments .................................. 1,100,923 1,567,764
------------ ------------
Net increase in net assets resulting from operations ......................... 1,022,533 1,500,483
------------ ------------
Distributions to shareholders from
Net investment income ............................................................. 0 (20,313)
------------ ------------
Capital share transactions
Increase in net assets resulting from capital share transactions (b) .............. 3,245,595 699,170
------------ ------------
Total increase in net assets .......................................... 4,268,128 2,179,340
NET ASSETS
Beginning of period ................................................................... 5,156,681 2,977,341
------------ ------------
End of period (including undistributed net investment income ......................... $ 9,424,809 $ 5,156,681
of $15,284 in 2004 and $133 in 2003) ============ ============
(a) Unaudited.
(b) A summary of capital share activity follows:
Period ended Year ended
March 31, 2004 (a) September 30, 2003
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Value Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
Shares sold ............................ 336,197 $ 3,848,609 103,376 $ 865,373
Shares redeemed ........................ (53,238) (603,014) (22,651) (166,203)
------------ ------------ ------------ ------------
Net increase ...................... 282,959 $ 3,245,595 80,725 $ 699,170
============ ============ ============ ============
See accompanying notes to financial statements
THE HILLMAN AGGRESSIVE EQUITY FUND
FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout the Period)
- ------------------------------------------------------------------------------------------------------------------------------------
Period ended Year ended Year ended Period ended
March 31, September 30, September 30, September 30,
2004 (a) 2003 2002 2001 (b)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period ............................. $ 9.63 $ 6.55 $ 7.51 $ 10.00
Income (loss) from investment operations
Net investment income (loss) .......................... 0.02 0.04 (0.04) (0.12)
Net realized and unrealized gain (loss) on investments 1.86 3.08 (0.92) (2.37)
----------- ----------- ----------- -----------
Total from investment operations .................. 1.88 3.12 (0.96) (2.49)
----------- ----------- ----------- -----------
Distributions to shareholders from
Net investment income ................................. 0.00 (0.04) 0.00 0.00
----------- ----------- ----------- -----------
Net asset value, end of period ................................... $ 11.51 $ 9.63 $ 6.55 $ 7.51
=========== =========== =========== ===========
Total return ..................................................... 19.52 % 47.60 % (12.67)% (25.00)%
=========== =========== =========== ===========
Ratios/supplemental data
Net assets, end of period .................................. $ 9,424,809 $ 5,156,681 $ 2,977,341 $ 2,863,908
=========== =========== =========== ===========
Ratio of expenses to average net assets
Before expense reimbursements and waived fees ......... 2.78 % (c) 3.93 % 4.06 % 6.32 %(c)
After expense reimbursements and waived fees .......... 1.56 % (c) 2.10 % 2.12 % 3.90 %(c)
Ratio of net investment (loss) income to average net assets
Before expense reimbursements and waived fees ......... (0.78)% (c) (1.30)% (2.41)% (4.96)%(c)
After expense reimbursements and waived fees .......... 0.44 % (c) 0.53 % (0.46)% (2.53)%(c)
Portfolio turnover rate .................................... 21.35 % 41.37 % 67.29 % 52.56 %
(a) Unaudited.
(b) For the period from December 29, 2000 (date of initial public investment) to September 30, 2001.
(c) Annualized.
See accompanying notes to financial statements
THE HILLMAN AGGRESSIVE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 2004
(Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND OTHER INFORMATION
The Hillman Aggressive Equity Fund (the "Fund") is a non-diversified series
of shares of beneficial interest of the Hillman Capital Management
Investment Trust (the "Trust"), an open-end management investment company.
The Trust was organized on July 14, 2000 as a Delaware Business Trust and
is registered under the Investment Company Act of 1940, as amended (the
"Act"). The Fund received its initial public investment on December 29,
2000 and began operations on January 2, 2001. The investment objective of
the Fund is to seek capital appreciation principally through investments in
equity securities, such as common and preferred stocks, and securities
convertible into common stocks. The following is a summary of significant
accounting policies followed by the Fund.
A. Security Valuation - The Fund's investments in securities are carried
at value. Securities listed on an exchange or quoted on a national
market system are valued at the last sales price as of the close of
the NYSE, generally 4:00 p.m. Eastern time on the day of valuation.
Other securities traded in the over-the-counter market and listed
securities for which no sale was reported on that date are valued at
the most recent bid price. Securities for which market quotations are
not readily available or which cannot be accurately valued using the
Fund's normal pricing procedures, if any, are valued following
procedures approved by the Board of Trustees of the Trust (the
"Trustees"). Short-term investments are valued at cost, which
approximates value.
B. Federal Income Taxes - No provision has been made for federal income
taxes since substantially all taxable income has been distributed to
shareholders. It is the policy of the Fund to comply with the
provisions of the Internal Revenue Code applicable to regulated
investment companies and to make sufficient distributions of taxable
income to relieve it from all federal income taxes.
The Fund has a capital loss carryforward for federal income tax
purposes of $61,754, which expires in the year 2009. It is the
intention of the Trustees not to distribute any realized gains until
the carryforwards have been offset or expire.
C. Investment Transactions - Investment transactions are recorded on the
trade date. Realized gains and losses are determined using the
specific identification cost method. Interest income is recorded daily
on an accrual basis. Dividend income is recorded on the ex-dividend
date.
D. Distributions to Shareholders - The Fund may declare dividends
quarterly, payable in March, June, September and December, on a date
selected by the Trustees. In addition, distributions may be made
annually in December out of net realized gains through October 31 of
that year. Distributions to shareholders are recorded on the
ex-dividend date. The Fund may make a supplemental distribution
subsequent to the end of its fiscal year.
E. Use of Estimates - The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and
assumptions that affect the amounts of assets, liabilities, expenses
and revenues reported in the financial statements. Actual results
could differ from those estimates.
(Continued)
THE HILLMAN AGGRESSIVE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 2004
(Unaudited)
NOTE 2 - INVESTMENT ADVISORY FEE AND OTHER RELATED PARTY TRANSACTIONS
Pursuant to an investment advisory agreement, Hillman Capital
Management, Inc. (the "Advisor") provides the Fund with a continuous
program of supervision of the Fund's assets, including the composition
of its portfolio, and furnishes advice and recommendations with
respect to investments, investment policies and the purchase and sale
of securities. As compensation for its services, the Advisor receives
a fee at the annual rate of 1.00% of the Fund's average daily net
assets. The Advisor has voluntarily waived a portion of its fee in the
amount of $18,009 ($0.03 per share) for the period ended March 31,
2004. There can be no assurance that the foregoing voluntary fee
waiver will continue.
The Fund's administrator, The Nottingham Company (the
"Administrator"), provides administrative services to and is generally
responsible for the overall management and day-to-day operations of
the Fund pursuant to a fund accounting and compliance agreement with
the Trust. As compensation for its services, the Administrator
receives a fee at the annual rate of 0.125% of the Fund's first $50
million of average daily net assets, 0.10% of the next $50 million of
average daily net assets, and 0.075% of average daily net assets over
$100 million. The contract with the Administrator provides that the
aggregate fees for the aforementioned administration services shall
not be less than $2,000 per month. The Administrator also receives a
monthly fee of $2,250 for accounting and record-keeping services, plus
0.01% of the average annual net assets. The Administrator has
voluntarily waived a portion of these fees amounting to $23,629 ($0.04
per share) for the period ended March 31, 2004. There can be no
assurance that the foregoing voluntary fee waivers will continue. The
Administrator also received the following to procure and pay the
custodian for the Trust: 0.02% on the first $100 million of the Fund's
net assets and 0.009% on all assets over $100 million, plus
transaction fees, with a minimum aggregate annual fee of $4,800. The
Administrator also charges the Fund for certain expenses involved with
the daily valuation of portfolio securities, which are believed to be
immaterial in amount.
NC Shareholder Services, LLC (the "Transfer Agent") serves as the
Fund's transfer, dividend paying, and shareholder servicing agent. The
Transfer Agent maintains the records of each shareholder's account,
answers shareholder inquiries concerning accounts, processes purchases
and redemptions of the Fund shares, acts as dividend and distribution
disbursing agent, and performs other shareholder servicing functions.
Certain Trustees and officers of the Trust are also officers of the
Advisor, the distributor or the Administrator.
NOTE 3 - DISTRIBUTION AND SERVICE FEES
The Trustees, including a majority of the Trustees who are not
"interested persons" of the Trust as defined in the Act, adopted a
distribution plan with respect to all shares pursuant to Rule 12b-1 of
the Act (the "Plan"). Rule 12b-1 regulates the manner in which a
regulated investment company may assume costs of distributing and
promoting the sales of its shares and servicing of its shareholder
accounts.
The Plan provides that the Fund may incur certain costs, which may not
exceed 0.25%, for each year elapsed subsequent to adoption of the
Plan, for payment to the distributor and others for items such as
advertising expenses, selling expenses, commissions, travel or other
expenses reasonably intended to result in sales of shares of the Fund
or support servicing of shareholder accounts. The Fund incurred $8,551
in distribution and service fees under the Plan for the period ended
March 31, 2004.
(Continued)
THE HILLMAN AGGRESSIVE EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 2004
(Unaudited)
NOTE 4 - PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of investments, other than short-term investments,
aggregated $4,574,763 and $1,447,736, respectively, for the period
ended March 31, 2004.
PROXY VOTING POLICY
A copy of the Trust's Proxy Voting and Disclosure Policy and the
Advisor's Proxy Voting and Disclosure Policy are included as Appendix
B to the Fund's Statement of Additional Information and is available,
without charge, upon request, by calling 1-800-773-3863. After June
30, 2004, information regarding how the Fund voted proxies relating to
portfolio securities during the most recent 12-month period ended June
30 will be available (1) without charge, upon request, by calling the
Fund at the number above and (2) on the SEC's website at
http://www.sec.gov.
________________________________________________________________________________
THE HILLMAN AGGRESSIVE
EQUITY FUND
________________________________________________________________________________
a series of the Hillman Capital Management Investment Trust
This Report has been prepared for
shareholders and may be distributed to
others only if preceded or accompanied by
a current prospectus.
________________________________________________________________________________
THE HILLMAN TOTAL RETURN FUND
________________________________________________________________________________
a series of the Hillman Capital Management Investment Trust
Semi-Annual Report
(Unaudited)
FOR THE PERIOD ENDED MARCH 31, 2004
INVESTMENT ADVISOR
Hillman Capital Management, Inc.
613 Third Street
Eastport Maritime Building
Annapolis, Maryland 21403
THE HILLMAN TOTAL RETURN FUND
116 South Franklin Street
Post Office Drawer 4365
Rocky Mount, North Carolina 27803-0365
1-800-773-3863
This report and the financial statements contained herein are submitted for the
general information of the shareholders of The Hillman Total Return Fund (the
"Fund"). This report is not authorized for distribution to prospective investors
in the Fund unless preceded or accompanied by an effective prospectus. Mutual
fund shares are not deposits or obligations of, or guaranteed by, any depository
institution. Shares are not insured by the FDIC, Federal Reserve Board or any
other agency, and are subject to investment risks, including possible loss of
principal amount invested. Neither the Fund nor the Fund's distributor is a
bank.
For more information about the Fund, including charges and expenses, call the
Fund for a free prospectus. You should read the prospectus carefully before you
invest or send money.
Distributor: Capital Investment Group, Inc., Post Office Drawer 4365, Rocky
Mount, North Carolina 27803, Phone 1-800-773-3863.
THE HILLMAN TOTAL RETURN FUND
PORTFOLIO OF INVESTMENTS
March 31, 2004
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Value
Shares (note 1)
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - 75.53%
Aerospace / Defense - 3.07%
Goodrich Corporation .................................................... 8,300 $ 232,981
The Boeing Company ...................................................... 5,700 234,099
------------
467,080
------------
Apparel - 1.89%
Nike Inc. ............................................................... 3,700 288,119
------------
Auto Manufacturers - 1.46%
General Motors Corporation .............................................. 4,700 221,370
------------
Biotechnology - 1.42%
(a)Amgen Inc. .............................................................. 3,700 215,229
------------
Chemicals - 1.47%
E.I. Du Pont de Nemours & Company ....................................... 5,300 223,766
------------
Commercial Services - 1.57%
Cendant Corporation ..................................................... 9,800 239,022
------------
Computers - 3.02%
(a)EMC Corporation ......................................................... 19,100 259,951
Hewlett-Packard Company ................................................. 8,700 198,708
------------
458,659
------------
Electric Companies - 3.51%
American Electric Power Company, Inc. ................................... 8,600 283,112
The Southern Company .................................................... 8,200 250,100
------------
533,212
------------
Financial Services - 2.97%
Allied Capital Corporation .............................................. 14,900 451,321
------------
Food - 6.39%
Campbell Soup Company ................................................... 8,600 234,522
HJ Heinz Company ........................................................ 6,900 257,301
Kellogg Company ......................................................... 5,900 231,516
Whole Foods Market Inc. ................................................. 3,300 247,335
------------
970,674
------------
Hand / Machine Tools - 1.80%
Black & Decker Corporation .............................................. 4,800 273,312
------------
(Continued)
THE HILLMAN TOTAL RETURN FUND
PORTFOLIO OF INVESTMENTS
March 31, 2004
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Value
Shares (note 1)
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - (Continued)
Healthcare Services - 5.80%
Aetna Inc. .................................................................. 4,000 $ 358,880
(a)Laboratory Corporation of America Holdings .................................. 6,900 270,825
(a)Sunrise Senior Assisted Living, Inc. ........................................ 7,000 250,950
------------
880,655
------------
Lodging - Hotels - 1.35%
(a)Host Marriott Corporation ................................................... 16,000 204,480
------------
Media - 3.11%
(a)Time Warner Inc. ............................................................ 15,000 252,900
Walt Disney Company ......................................................... 8,800 219,912
------------
472,812
------------
Miscellaneous Manufacturing - 3.46%
3M Co. ...................................................................... 3,400 278,358
General Electric Company .................................................... 8,100 247,212
------------
525,570
------------
Pharmaceutical - 1.68%
Pfizer Inc. ................................................................. 7,300 255,865
------------
Real Estate Investment Trusts - 6.50%
Apartment Investment & Management Company ................................... 6,200 192,758
Correctional Properties Trust ............................................... 9,400 289,520
Equity Office Properties Trust .............................................. 8,900 257,121
Equity Residential .......................................................... 8,300 247,755
------------
987,154
------------
Retail - 15.27%
(a)Brinker International, Inc. ................................................. 7,300 276,889
(a)Finlay Enterprises .......................................................... 22,400 403,424
Home Depot Inc. ............................................................. 6,100 227,896
McDonald's Corporation ...................................................... 8,600 245,702
Outback Steakhouse Inc. ..................................................... 5,300 258,110
Sears Roebuck and Co. ....................................................... 4,700 201,912
(a)Staples Inc. ................................................................ 8,300 210,737
Wal-Mart Stores Inc. ........................................................ 4,500 268,605
Wendy's International Inc. .................................................. 5,600 227,864
------------
2,321,139
------------
(Continued)
THE HILLMAN TOTAL RETURN FUND
PORTFOLIO OF INVESTMENTS
March 31, 2004
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Value
Shares (note 1)
- ------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - (Continued)
Telecommunications - 8.16%
(a)AT&T Wireless Services, Inc. ............................................ 19,700 $ 268,117
(a)Corning Incorporated .................................................... 22,400 250,432
Motorola Incorporated ................................................... 16,500 290,400
SBC Communications Inc. ................................................. 8,200 201,228
Verizon Communications Inc. ............................................. 6,300 230,202
------------
1,240,379
------------
Transportation - 1.63%
FedEx Corporation ....................................................... 3,300 248,028
------------
Total Common Stocks (Cost $9,296,210) ................................................................. 11,477,846
------------
Interest Maturity
Principal Rate Date
------------- ------------ ------------
U.S. GOVERNMENT OBLIGATIONS - 3.68%
United States Treasury Note .............................. $ 50,000 6.875% 05/15/06 55,459
United States Treasury Note .............................. 500,000 2.625% 05/15/08 503,047
------------
Total U.S. Government Obligations (Cost $549,006) ................................................. 558,506
------------
CORPORATE OBLIGATIONS - 10.38%
DaimlerChrysler NA Holdings Corp. ........................ 140,000 8.500% 01/18/31 172,171
Ford Motor Credit Co. .................................... 420,000 6.875% 02/01/06 446,723
General Motors Acceptance Corp. .......................... 200,000 7.500% 07/15/05 212,832
Merrill Lynch & Co., Inc. ................................ 40,000 0.000% 03/20/28 7,917
Motorola Inc. ............................................ 200,000 6.750% 02/01/06 215,114
Toys R US Inc. ........................................... 500,000 7.625% 08/01/11 522,500
------------
Total Corporate Obligations (Cost $1,522,495) ..................................................... 1,577,257
------------
INVESTMENT COMPANIES - 3.95% Shares
----------
BlackRock Broad Investment Grade 2009 Term Trust ................................... 20,000 330,000
Putnam Master Income Trust ......................................................... 40,600 270,802
------------
Total Investment Companies (Cost $566,167) ............................................................ 600,802
------------
(Continued)
THE HILLMAN TOTAL RETURN FUND
PORTFOLIO OF INVESTMENTS
March 31, 2004
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Value
(note 1)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Value of Investments (Cost $11,933,878 (b)) ............................................. 93.54 % $ 14,214,411
Other Assets Less Liabilities ................................................................. 6.46 % 981,685
-------- ------------
Net Assets .............................................................................. 100.00 % $ 15,196,096
======== ============
(a) Non-income producing investment.
(b) Aggregate cost for financial reporting and federal income tax purposes is the same. Unrealized appreciation/
(depreciation) of investments for financial reporting and federal income tax purposes is as follows:
Unrealized appreciation ............................................................ $ 2,612,583
Unrealized depreciation ............................................................ (332,050)
------------
Net unrealized appreciation ............................................ $ 2,280,533
============
See accompanying notes to financial statements
THE HILLMAN TOTAL RETURN FUND
STATEMENT OF ASSETS AND LIABILITIES
March 31, 2004
(Unaudited)
ASSETS
Investments, at value (cost $11,933,878) ........................................................ $ 14,214,411
Cash ............................................................................................ 724,707
Income receivable ............................................................................... 44,100
Receivable for fund shares sold ................................................................. 215,891
Other asset ..................................................................................... 17,596
------------
Total assets ............................................................................... 15,216,705
------------
LIABILITIES
Accrued expenses ................................................................................ 20,609
------------
NET ASSETS
(applicable to 1,312,587 shares outstanding; unlimited
shares of no par value beneficial interest authorized) ......................................... $ 15,196,096
============
NET ASSET VALUE, REDEMPTION AND OFFERING PRICE PER SHARE
($15,196,096 / 1,312,587 shares) ................................................................ $ 11.58
============
NET ASSETS CONSIST OF
Paid-in capital ................................................................................. $ 13,024,026
Undistributed net investment income ............................................................. 54,441
Accumulated net realized loss on investments .................................................... (162,904)
Net unrealized appreciation on investments ...................................................... 2,280,533
------------
$ 15,196,096
============
See accompanying notes to financial statements
THE HILLMAN TOTAL RETURN FUND
STATEMENT OF OPERATIONS
Period ended March 31, 2004
(Unaudited)
NET INVESTMENT INCOME
Income
Interest ..................................................................................... $ 65,125
Dividends .................................................................................... 138,822
------------
Total income ............................................................................. 203,947
------------
Expenses
Investment advisory fees (note 2) ............................................................ 67,374
Fund administration fees (note 2) ............................................................ 8,422
Distribution and service fees (note 3) ....................................................... 16,844
Custody fees (note 2) ........................................................................ 2,313
Fund accounting fees (note 2) ................................................................ 14,174
Audit and tax preparation fees ............................................................... 6,637
Legal fees ................................................................................... 5,999
Securities pricing fees ...................................................................... 2,532
Shareholder recordkeeping fees (note 2) ...................................................... 10,524
Other accounting fees (note 2) ............................................................... 3,589
Shareholder servicing expenses ............................................................... 1,069
Registration and filing expenses ............................................................. 5,002
Printing expenses ............................................................................ 62
Trustee fees and meeting expenses ............................................................ 2,990
Other operating expenses ..................................................................... 1,856
------------
Total expenses ........................................................................... 149,387
------------
Less:
Investment advisory fees waived (note 2) ............................................ (18,097)
Fund administration fees waived (note 2) ............................................ (7,597)
Fund accounting fees waived (note 2) ................................................ (674)
Shareholder recordkeeping fees waived (note 2) ...................................... (1,524)
Other accounting fees waived (note 2) ............................................... (3,589)
------------
Net expenses ............................................................................. 117,906
------------
Net investment income ............................................................... 86,041
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized loss from investment transactions .................................................... (42,516)
Change in unrealized appreciation on investments .................................................. 1,574,885
------------
Net realized and unrealized gain on investments .............................................. 1,532,369
------------
Net increase in net assets resulting from operations ..................................... $ 1,618,410
===========
See accompanying notes to financial statements
THE HILLMAN TOTAL RETURN FUND
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
Period ended Year ended
March 31, September 30,
2004 (a) 2003
- ------------------------------------------------------------------------------------------------------------------------------------
INCREASE IN NET ASSETS
Operations
Net investment income ............................................................. $ 86,041 $ 136,767
Net realized loss from investment transactions .................................... (42,516) (119,864)
Change in unrealized appreciation on investments .................................. 1,574,885 1,718,571
------------ ------------
Net increase in net assets resulting from operations ......................... 1,618,410 1,735,474
------------ ------------
Distributions to shareholders from
Net investment income ............................................................. (32,398) (140,116)
Net realized gain from investment transactions .................................... 0 (65,194)
------------ ------------
Decrease in net assets resulting from distributions .......................... (32,398) (205,310)
------------ ------------
Capital share transactions
Increase in net assets resulting from capital share transactions (b) .............. 1,855,991 3,936,359
------------ ------------
Total increase in net assets .......................................... 3,442,003 5,466,523
NET ASSETS
Beginning of period ................................................................... 11,754,093 6,287,570
------------ ------------
End of period (including undistributed net investment income ........................ $ 15,196,096 $ 11,754,093
of $54,441 in 2004 and $798 in 2003) ============ =============
(a) Unaudited.
(b) A summary of capital share activity follows:
Period ended Year ended
March 31, 2004 (a) September 30, 2003
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Value Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
Shares sold ............................................ 171,809 $ 1,922,603 433,509 $ 4,147,763
Shares issued for reinvestment of distributions ........ 2,914 32,398 16,936 158,126
------------ ------------ ------------ ------------
174,723 1,955,001 450,445 4,305,889
Shares redeemed ........................................ (8,979) (99,010) (42,340) (369,530)
------------ ------------ ------------ ------------
Net increase ...................................... 165,744 $ 1,855,991 408,105 $ 3,936,359
============ ============ ============ ============
See accompanying notes to financial statements
THE HILLMAN TOTAL RETURN FUND
FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout the Period)
- ------------------------------------------------------------------------------------------------------------------------------------
Period ended Year ended Year ended Period ended
March 31, September 30, September 30, September 30,
2004 (a) 2003 2002 2001 (b)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period ............................ $ 10.25 $ 8.51 $ 8.77 $ 10.00
Income (loss) from investment operations
Net investment income ................................ 0.07 0.14 0.10 0.01
Net realized and unrealized gain (loss) on investments 1.29 1.83 (0.25) (1.24)
----------- ----------- ----------- -----------
Total from investment operations ................. 1.36 1.97 (0.15) (1.23)
----------- ----------- ----------- -----------
Distributions to shareholders from
Net investment income ................................ (0.03) (0.15) (0.11) 0.00
Net realized gain from investment transactions ....... 0.00 (0.08) 0.00 0.00
----------- ----------- ----------- -----------
Total distributions .............................. (0.03) (0.23) (0.11) 0.00
----------- ----------- ----------- -----------
Net asset value, end of period .................................. $ 11.58 $ 10.25 $ 8.51 $ 8.77
=========== =========== =========== ===========
Total return .................................................... 13.25 % 23.46 % (1.56)% (12.50)%
=========== =========== =========== ===========
Ratios/supplemental data
Net assets, end of period ................................. $15,196,096 $11,754,093 $ 6,287,570 $ 5,925,796
=========== =========== =========== ===========
Ratio of expenses to average net assets
Before expense reimbursements and waived fees ........ 2.22 % (c) 2.61 % 2.83 % 4.22 %(c)
After expense reimbursements and waived fees ......... 1.75 % (c) 1.83 % 1.80 % 2.78 %(c)
Ratio of net investment income (loss) to average net assets
Before expense reimbursements and waived fees ........ 0.84 % (c) 0.83 % 0.08 % (1.17)%(c)
After expense reimbursements and waived fees ......... 1.30 % (c) 1.62 % 1.11 % 0.27 %(c)
Portfolio turnover rate ................................... 6.49 % 19.71 % 40.37 % 6.03 %
(a) Unaudited.
(b) For the period from December 29, 2000 (date of initial public investment) to September 30, 2001.
(c) Annualized.
See accompanying notes to financial statements
THE HILLMAN TOTAL RETURN FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 2004
(Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND OTHER INFORMATION
The Hillman Total Return Fund (the "Fund") is a diversified series of
shares of beneficial interest of the Hillman Capital Management
Investment Trust (the "Trust"), an open-end management investment
company. The Trust was organized on July 14, 2000 as a Delaware
Business Trust and is registered under the Investment Company Act of
1940, as amended (the "Act"). The Fund received its initial public
investment on December 29, 2000 and began operations on January 2,
2001. The investment objective of the Fund is to seek capital
appreciation principally through investments in equity securities,
such as common and preferred stocks, and securities convertible into
common stocks. The following is a summary of significant accounting
policies followed by the Fund.
A. Security Valuation - The Fund's investments in securities are
carried at value. Securities listed on an exchange or quoted on a
national market system are valued at the last sales price as of
the close of the NYSE, generally 4:00 p.m. Eastern time, on the
day of valuation. Other securities traded in the over-the-counter
market and listed securities for which no sale was reported on
that date are valued at the most recent bid price. Securities for
which market quotations are not readily available or which cannot
be accurately valued using the Fund's normal pricing procedures,
if any, are valued following procedures approved by the Board of
Trustees of the Trust (the "Trustees"). Short-term investments
are valued at cost, which approximates value.
B. Federal Income Taxes - No provision has been made for federal
income taxes since substantially all taxable income has been
distributed to shareholders. It is the policy of the Fund to
comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies and to make
sufficient distributions of taxable income to relieve it from all
federal income taxes.
C. Investment Transactions - Investment transactions are recorded on
the trade date. Realized gains and losses are determined using
the specific identification cost method. Interest income is
recorded daily on an accrual basis. Dividend income is recorded
on the ex-dividend date.
D. Distributions to Shareholders - The Fund may declare dividends
quarterly, payable in March, June, September and December, on a
date selected by the Trustees. In addition, distributions may be
made annually in December out of net realized gains through
October 31 of that year. Distributions to shareholders are
recorded on the ex-dividend date. The Fund may make a
supplemental distribution subsequent to the end of its fiscal
year.
E. Use of Estimates - The preparation of financial statements in
conformity with accounting principles generally accepted in the
United States of America requires management to make estimates
and assumptions that affect the amounts of assets, liabilities,
expenses and revenues reported in the financial statements.
Actual results could differ from those estimates.
NOTE 2 - INVESTMENT ADVISORY FEE AND OTHER RELATED PARTY TRANSACTIONS
Pursuant to an investment advisory agreement, Hillman Capital
Management, Inc. (the "Advisor") provides the Fund with a continuous
program of supervision of the Fund's assets, including the composition
of its portfolio, and furnishes advice and recommendations with
respect to investments, investment policies and the purchase and sale
of securities. As compensation for its services, the Advisor receives
a fee at the annual rate of 1.00% of the Fund's average daily net
assets.
(Continued)
THE HILLMAN TOTAL RETURN FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 2004
(Unaudited)
NOTE 2 - INVESTMENT ADVISORY FEE AND OTHER RELATED PARTY TRANSACTIONS(Continued)
The Advisor has voluntarily waived a portion of its fee in the amount
of $18,097 ($0.01 per share) for the period ended March 31, 2004.
There can be no assurance that the foregoing voluntary fee waiver will
continue.
The Fund's administrator, The Nottingham Company (the
"Administrator"), provides administrative services to and is generally
responsible for the overall management and day-to-day operations of
the Fund pursuant to a fund accounting and compliance agreement with
the Trust. As compensation for its services, the Administrator
receives a fee at the annual rate of 0.125% of the Fund's first $50
million of average daily net assets, 0.10% of the next $50 million of
average daily net assets, and 0.075% of average daily net assets over
$100 million. The contract with the Administrator provides that the
aggregate fees for the aforementioned administration services shall
not be less than $2,000 per month. The Administrator also receives a
monthly fee of $2,250 for accounting and record-keeping services, plus
0.01% of the average annual net assets. The Administrator has
voluntarily waived a portion of these fees amounting to $11,860 ($0.01
per share) for the period ended March 31, 2004. There can be no
assurance that the foregoing voluntary fee waivers will continue. The
Administrator also receives the following to procure and pay the
custodian for the Trust: 0.02% on the first $100 million of the Fund's
net assets and 0.009% on all assets over $100 million, plus
transaction fees, with a minimum aggregate annual fee of $4,800. The
Administrator also charges the Fund for certain expenses involved with
the daily valuation of portfolio securities, which are believed to be
immaterial in amount.
NC Shareholder Services, LLC (the "Transfer Agent") serves as the
Fund's transfer, dividend paying, and shareholder servicing agent. The
Transfer Agent maintains the records of each shareholder's account,
answers shareholder inquiries concerning accounts, processes purchases
and redemptions of the Fund shares, acts as dividend and distribution
disbursing agent, and performs other shareholder servicing functions.
The Transfer Agent is compensated based upon a $15 fee per shareholder
per year, subject to a minimum fee of $1,750 per month per fund. The
Transfer Agent has voluntarily waived a portion of this fee amounting
to $1,524 for the period ended March 31, 2004.
Certain Trustees and officers of the Trust are also officers of the
Advisor, the distributor or the Administrator.
NOTE 3 - DISTRIBUTION AND SERVICE FEES
The Trustees, including a majority of the Trustees who are not
"interested persons" of the Trust as defined in the Act, adopted a
distribution plan with respect to all shares pursuant to Rule 12b-1 of
the Act (the "Plan"). Rule 12b-1 regulates the manner in which a
regulated investment company may assume costs of distributing and
promoting the sales of its shares and servicing of its shareholder
accounts.
The Plan provides that the Fund may incur certain costs, which may not
exceed 0.25%, for each year elapsed subsequent to adoption of the
Plan, for payment to the distributor and others for items such as
advertising expenses, selling expenses, commissions, travel or other
expenses reasonably intended to result in sales of shares of the Fund
or support servicing of shareholder accounts. The Fund incurred
$16,844 in distribution and service fees under the Plan for the period
ended March 31, 2004.
(Continued)
THE HILLMAN TOTAL RETURN FUND
NOTES TO FINANCIAL STATEMENTS
March 31, 2004
(Unaudited)
NOTE 4 - PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of investments, excluding long-term U.S.
government securities and short-term obligations, aggregated
$2,879,975 and $333,145, respectively, for the period ended March 31,
2004. Purchases and sales of long-term U.S. government securities
aggregated $0 and $491,250, respectively, for the period ended March
31, 2004.
PROXY VOTING POLICY
A copy of the Trust's Proxy Voting and Disclosure Policy and the
Advisor's Proxy Voting and Disclosure Policy are included as Appendix
B to the Fund's Statement of Additional Information and is available,
without charge, upon request, by calling 1-800-773-3863. After June
30, 2004, information regarding how the Fund voted proxies relating to
portfolio securities during the most recent 12-month period ended June
30 will be available (1) without charge, upon request, by calling the
Fund at the number above and (2) on the SEC's website at
http://www.sec.gov.
________________________________________________________________________________
THE HILLMAN TOTAL RETURN FUND
________________________________________________________________________________
a series of the Hillman Capital Management Investment Trust
This Report has been prepared for shareholders
and may be distributed to others only if
preceded or accompanied by a current
prospectus.
Item 2. CODE OF ETHICS.
Not applicable.
Item 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
Item 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
Items 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
Items 6. [RESERVED]
Item 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
Item 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
Item 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS.
Not applicable.
Item 10. CONTROLS AND PROCEDURES.
(a) The Principal Executive Officer and the Principal Financial Officer
have concluded that the registrant's disclosure controls and procedures
are effective based on their evaluation of the disclosure controls and
procedures as of a date within 90 days of the filing of this report.
(b) There were no changes in the registrant's internal control over
financial reporting that occurred during the registrant's fiscal
half-year that have materially affected, or are reasonably likely to
materially affect, the registrant's internal control over financial
reporting.
Item 11. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications required by Item 11.(a)(2) of Form N-CSR are filed
herewith as Exhibit 11.(a)(2).
(b) Certifications required by Item 11.(b) of Form N-CSR are filed herewith
as Exhibit 11.(b).
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.
Hillman Capital Management Investment Trust
By: (Signature and Title) /s/ Mark A. Hillman
________________________________
Mark A. Hillman, Trustee, President and
Principal Executive Officer
Date: May 28, 2004
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/ Mark A. Hillman
________________________________
Mark A. Hillman, Trustee, President and
Principal Executive Officer
Date: May 28, 2004
By: (Signature and Title) /s/ Fletcher D. Perkins
________________________________
Fletcher D. Perkins, Treasurer and
Principal Financial Officer
Date: May 28, 2004