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
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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
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(Address of principal executive offices) (Zip code)
Julian G. Winters
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
------------
Date of reporting period: March 31, 2005
--------------
Item 1. REPORTS TO STOCKHOLDERS.
Semi-Annual Report 2005
Total Return Fund
Aggressive Equity Fund
March 31, 2005
(Unaudited)
[Company logo here]
HILLMAN
capital management
This report and the financial statements contained herein are submitted for the
general information of the shareholders of the Hillman Capital Management Funds
("Funds"). This report is not authorized for distribution to prospective
investors in the Funds 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 Funds nor the
Funds' distributor is a bank.
Distributor: Capital Investment Group, Inc., P.O. Box 4365, Rocky Mount, NC
27803, Phone 1-800-773-3863.
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Investments in the Hillman Capital Management Funds ("Funds") are subject to
investment risks, including the possible loss of some or the entire principal
amount invested. There can be no assurance that the Funds will be successful in
meeting its investment objective. Investment in the Funds is also subject to the
following risks: market risk, investment advisor risk, credit risk, interest
rate risk, maturity risk, investment-grade securities risk, short sales risk,
management style risk, non-diversified fund risk, and sector focus risk. More
information about these risks and other risks can be found in the Funds'
prospectus.
The performance information quoted in this semi-annual report represents past
performance, which is not a 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. An investor
may obtain performance data current to the most recent month-end by visiting
www.nottinghamco.com.
An investor should consider the investment objectives, risks, and charges and
expenses of the Funds carefully before investing. The prospectus contains this
and other information about the Funds. A copy of the prospectus is available at
www.nottinghamco.com or by calling Shareholder Services at 1-800-773-3863. The
prospectus should be read carefully before investing.
- --------------------------------------------------------------------------------
Stated performance in the Funds was achieved at some or all points during the
year by waiving or reimbursing part of those Funds' total expenses to ensure
shareholders did not absorb expenses significantly greater than the industry
norm.
This Semi-Annual Report was first distributed to shareholders on or about May
28, 2005.
For More Information on Your Hillman Capital Management (Hillman) Mutual Funds:
See Our Web site @ www.hillmancapital.com
or
Call Our Shareholder Services Group Toll-Free at 1-800-773-3863
Fund Expenses
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As a shareholder of the Funds, you incur ongoing costs, including management
fees; distribution (12b-1) fees; and other Fund expenses. This example is
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. The example is based on an investment of $1,000 invested at
the beginning of the period and held for the entire period as indicated below.
Actual Expenses - The first line of the table below provides information about
the actual account values and actual expenses. You may use the information in
this line, together with the amount you invested, to estimate the expenses that
you paid over the period. 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 in the first line under the heading entitled "Expenses Paid
During Period" to estimate the expenses you paid on your account during this
period.
Hypothetical Example for Comparison Purposes - The second line of the table
below provides information about hypothetical account values and hypothetical
expenses based on the Fund's actual expense ratio and an assumed annual rate of
return of 5% before expenses, which is not the Fund's actual return. The
hypothetical account values and expenses may not be used to estimate the actual
ending account balance or expenses you paid for the period. You may use this
information to compare the ongoing costs of investing in the Fund and other
funds by comparing this 5% hypothetical example with the 5% hypothetical
examples that appear in the shareholder reports of other funds.
Beginning Ending
The Hillman Total Return Fund Account Value Account Value Expenses Paid
Expense Example October 1, 2004 March 31, 2005 During Period*
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Actual $1,000.00 $1,060.40 $8.99
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Hypothetical (5% return before expenses) $1,000.00 $1,016.21 $8.80
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Beginning Ending
The Hillman Aggressive Equity Fund Account Value Account Value Expenses Paid
Expense Example October 1, 2004 March 31, 2005 During Period*
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Actual $1,000.00 $1,121.70 $9.26
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Hypothetical (5% return before expenses) $1,000.00 $1,016.21 $8.80
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* Expenses are equal to the Funds' annualized expense ratio 1.75% multiplied by the average account value over the period,
multiplied by the number of days in the most recent fiscal half-year divided by 365 (to reflect the semi-annual period). Fund
Expenses
THE HILLMAN TOTAL RETURN FUND
Schedule of Investments
(Unaudited)
As of March 31, 2005
- ---------------------------------------------------------------------------------------------------------------------------------
Shares or Market Value Shares or Market Value
Principal (Note 1) Principal (Note 1)
- --------------------------------------------------------------- -----------------------------------------------------------------
COMMON STOCKS - 78.36% Healthcare - Services - 5.11%
Aetna Inc. 8,000 $ 599,600
Aerospace / Defense - 3.57% * Laboratory Corp. of
Goodrich Corporation 8,300 $ 317,807 America Holdings 6,900 332,580
The Boeing Corporation 5,700 333,222 ------------
------------ 932,180
651,029 ------------
------------ Home Builders - 1.92%
Apparel - 1.69% D.R. Horton, Inc. 12,000 350,880
Nike, Inc. 3,700 308,247 ------------
------------
Media - 3.14%
Biotechnology - 1.82% * Time Warner Inc. 15,000 263,250
* Amgen, Inc. 5,700 331,797 Walt Disney Company 10,800 310,284
------------ ------------
573,534
Chemicals - 1.49% ------------
El Du Pont de Nemours & Co. 5,300 271,572 Miscellaneous Manufacturing - 3.20%
------------ 3M Co. 3,400 291,346
General Electric Company 8,100 292,086
Commercial Services - 1.67% ------------
Cendant Corp. 14,800 303,992 583,432
------------ ------------
Pharmaceuticals - 3.72%
Computers - 3.42% Merck & Co. Inc. 11,000 356,070
* EMC Corp. 19,100 235,312 Pfizer Inc. 12,300 323,121
Hewlett-Packard Company 17,700 388,338 ------------
------------ 679,191
623,650 ------------
------------ Real Estate Investment Trust - 8.88%
Electric - 3.04% Apartment Investment &
American Electric Power Management Company 9,200 342,240
Company Inc. 8,600 292,916 Correctional Properties Trust 9,400 237,350
The Southern Company 8,200 261,006 Equity Office Properties Trust 10,900 328,417
------------ Equity Residential 10,300 331,763
553,922 Host Marriott Corporation 23,000 380,880
------------ ------------
Financial Services - 2.85% 1,620,650
Allied Capital Corporation 19,900 519,390 ------------
------------ Retail - 11.00%
* Brinker International, Inc. 6,100 264,406
Food - 6.01% Home Depot, Inc. 8,600 233,264
Campbell Soup Company 8,600 249,572 McDonald's Corporation 7,300 267,804
HJ Heinz Company 6,900 254,196 Outback Steakhouse, Inc. 10,300 334,267
Kellogg Company 5,900 255,293 Staples, Inc. 6,500 323,729
Whole Foods Market Inc. 3,300 337,029 Wal-Mart Stores, Inc. 6,600 325,715
------------ Wendy's International, Inc. 14,000 257,664
1,096,090 ------------
------------ 2,006,849
Hand / Machine Tools - 2.08% ------------
Black & Decker Corporation 4,800 379,152 Semiconductors - 1.95%
------------ Texas Instruments
Incorporated 14,000 356,860
Healthcare - Products - 1.84% ------------
Johnson & Johnson 5,000 335,800
------------ Software - 1.59%
Microsoft Corporation 12,000 290,040
------------
(Continued)
THE HILLMAN TOTAL RETURN FUND
Schedule of Investments
(Unaudited)
As of March 31, 2005
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Shares or Market Value Shares or Market Value
Principal (Note 1) Principal (Note 1)
- ----------------------------------------------------------------- ----------------------------------------------------------------
COMMON STOCKS - (Continued) Total Investments (Cost $15,539,143) - 99.67% $ 18,183,001
Other Assets Less Liabilities - 0.33% 60,402
Telecommunications - 6.67% ------------
* Corning Incorporated 37,400 $ 416,262
Motorola, Inc. 18,500 276,945 Net Assets - 100.00% $ 18,243,403
SBC Communications Inc. 11,200 265,328 ============
Verizon Communications Inc. 7,300 259,150
------------ * Non-income producing investment.
1,217,685
------------ (B) Restricted security - A restricted security cannot be
Transportation - 1.70% resold to the general public without prior registration
FedEx Corp. 3,300 310,035 under the Securities Act of 1933. Restricted securities are
------------ valued according to the guidelines and procedures adopted by
the Board of Trustees. The Fund currently holds 821,463
Total Common Stocks (Cost $11,591,484) 14,295,977 shares of Pamlico Enhanced Cash Trust at a cost of $821,463.
------------ The sale of this investment has been restricted and has been
valued in accordance with the guidelines adopted by the
MONEY MARKET FUNDS - 6.90% Board of Trustees. The total fair value of this security at
Evergreen Institutional Treasury March 31, 2005 is $821,463, which represents 4.50% of net
Money Market Fund 437,369 437,369 assets.
Merrimac Cash Series Trust 821,463 821,463
Total Money Market Funds (Cost $1,258,832) 1,258,832
------------
PRIVATE INVESTMENT COMPANY - 4.50%
(B) Pamlico Enhanced Cash Trust 821,463 821,463
(Cost $821,463) ------------
CORPORATE BONDS - 6.99%
DaimlerChrysler NA Holding Corp.
8.50%, 01/18/2031 $ 140,000 168,931
Ford Motor Credit Co.
6.875%, 02/01/2006 420,000 425,711
General Motors Acceptance Corp.
7.50%, 07/15/2005 200,000 201,605
Merrill Lynch & Co Inc.
0.00%, 03/20/2028 40,000 8,347
Toys R US Inc.
7.625%, 08/2011 500,000 470,000
Total Corporate Bonds (Cost $1,318,529) 1,274,594
------------
U.S. GOVERNMENT OBLIGATIONS - 2.92%
United States Treasury Note
6.875%, 05/15/2006 $ 50,000 $ 51,822
United States Treasury Note
2.625%, 05/15/2008 500,000 480,313
Total U.S. Government Obligations
(Cost $548,835) 532,135
------------
(Continued)
THE HILLMAN TOTAL RETURN FUND
Schedule of Investments
(Unaudited)
As of March 31, 2005
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Summary of Investments by Industry
% of Net
Industry Assets Value
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Aerospace / Defense 3.57% $ 651,029
Apparel 1.69% 308,247
Biotechnology 1.82% 331,797
Chemicals 1.49% 271,572
Commercial Services 1.67% 303,992
Computers 3.42% 623,650
Corporate Bonds 6.99% 1,274,594
Electric 3.04% 553,922
Financial Services 2.85% 519,390
Food 6.01% 1,096,090
Hand / Machine Tools 2.08% 379,152
Healthcare - Products 1.84% 335,800
Healthcare - Services 5.11% 932,180
Home Builders 1.92% 350,880
Media 3.14% 573,534
Miscellaneous Manufacturing 3.20% 583,432
Money Market Funds 6.90% 1,258,832
Pharmaceuticals 3.72% 679,191
Private Investment Company 4.50% 821,463
Real Estate Investment Trust 8.88% 1,620,650
Retail 11.00% 2,006,849
Semiconductors 1.95% 356,860
Software 1.59% 290,040
Telecommunications 6.67% 1,217,685
Transportation 1.70% 310,035
U.S. Treasury Notes 2.92% 532,135
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Total 99.67% $ 18,183,001
See Notes to Financial Statements
THE HILLMAN AGGRESSIVE EQUITY FUND
Schedule of Investments
(Unaudited)
As of March 31, 2005
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Market Value Market Value
Shares (Note 1) Shares (Note 1)
- --------------------------------------------------------------- ---------------------------------------------------------------
COMMON STOCK - 95.84% Telecommunications - 19.04%
* Corning Inc. 83,100 $ 924,903
Aerospace / Defense - 9.65% Motorola, Inc. 64,900 971,553
Goodrich Corporation 25,300 $ 968,737 SBC Communications Inc. 43,700 1,035,253
The Boeing Corporation 17,400 1,017,204 Verizon Communications Inc. 27,800 986,900
------------ -----------
3,918,609
1,985,941 -----------
------------ Transportation - 4.20%
Commercial Services - 4.25% FedEx Corp. 9,200 864,340
Cendant Corp. 42,600 875,004 -----------
------------
Total Common Stock (Cost $16,513,194) 19,722,983
Computers - 9.94% -----------
* EMC Corp. 77,600 956,032
Hewlett-Packard Company 49,700 1,090,418 PRIVATE INVESTMENT COMPANY - 3.21%
------------ (B) Pamlico Enhanced Cash Trust 660,713 660,713
2,046,450 (Cost $660,713) -----------
------------
Electric - 4.29%
American Electric Power Total Investments (Cost $17,173,907) - 99.05% $ 20,383,696
Company Inc. 25,900 882,154 Other Assets Less Liabilities - 0.95% 195,648
------------ ------------
Food - 4.57% Net Assets - 100.00% $ 20,579,344
Whole Foods Market Inc. 9,200 939,596 ============
------------
* Non-income producing investment.
Healthcare - Services - 11.14%
Aetna Inc. 17,200 1,289,140 (B) Restricted security - A restricted security cannot be
* Laboratory Corp. of resold to the general public without prior registration
America Holdings 20,800 1,002,560 under the Securities Act of 1933. Restricted securities are
------------ valued according to the guidelines and procedures adopted by
2,291,700 the Board of Trustees. The Fund currently holds 660,713
------------ shares of Pamlico Enhanced Cash Trust at a cost of $660,713.
Home Builders - 5.11% The sale of this investment has been restricted and has been
D.R. Horton, Inc. 36,000 1,052,640 valued in accordance with the guidelines adopted by the
------------ Board of Trustees. The total fair value of this security at
March 31, 2005 is $660,713, which represents 3.21% of net
Miscellaneous Manufacturing - 4.98% assets.
General Electric Company 28,400 1,024,104
------------
Real Estate Investment Trust - 9.21%
Equity Office Properties Trust 32,400 976,212
Host Marriott Corporation 55,500 919,080
------------
1,895,292
------------
Retail - 4.38%
Outback Steakhouse, Inc. 19,700 902,063
------------
Semiconductors - 5.08%
Texas Instruments Incorporated 41,000 1,045,090
------------
(Continued)
THE HILLMAN AGGRESSIVE EQUITY FUND
Schedule of Investments
(Unaudited)
As of March 31, 2005
- -----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------
Summary of Investments by Industry
% of Net
Industry Assets Value
- ----------------------------------------------------------------------
Aerospace / Defense 9.65% $ 1,985,941
Commercial Services 4.25% 875,004
Computers 9.94% 2,046,450
Electric 4.29% 882,154
Food 4.57% 939,596
Healthcare - Services 11.14% 2,291,700
Home Builders 5.11% 1,052,640
Miscellaneous Manufacturing 4.98% 1,024,104
Private Investment Company 3.21% 660,713
Real Estate Investment Trust 9.21% 1,895,292
Retail 4.38% 902,063
Semiconductors 5.08% 1,045,090
Telecommunications 19.04% 3,918,609
Transportation 4.20% 864,340
- ----------------------------------------------------------------------
Total 99.05% $ 20,383,696
See Notes to Financial Statements
Hillman Capital Management Funds
Statements of Assets and Liabilities
(Unaudited)
Total Return Aggressive Equity
As of March 31, 2005 Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Assets:
Investments, at cost $ 15,539,143 $ 17,173,907
Investments, at value (note 1) $ 18,183,001 $ 20,383,696
Cash 4,618 12,180
Receivables:
Fund shares sold - 141,440
Income 55,291 39,237
Prepaid expenses 14,139 13,899
Total Assets 18,257,049 20,590,452
Liabilities:
Accrued expenses 13,646 11,108
Total Liabilities 13,646 11,108
Net Assets $ 18,243,403 $ 20,579,344
Net Assets Consist of:
Capital (par value and paid in surplus) 15,484,820 17,195,596
Undistributed net investment income 67,017 21,918
Undistributed net realized gain on investments 47,708 152,041
Net unrealized appreciation in investments 2,643,858 3,209,789
Total Net Assets $ 18,243,403 $ 20,579,344
Shares Outstanding, no par value (unlimited authorized shares) 1,519,753 1,553,588
Net Asset Value Offering Price and Redemption Price Per Share $ 12.00 $ 13.25
See Notes to Financial Statements.
Hillman Capital Management Funds
Statements of Operations
(Unaudited)
Total Return Aggressive Equity
For the period ended March 31, 2005 Fund Fund
- ----------------------------------------------------------------------------------------------------------------------------------
Investment Income:
Interest $ 52,380 $ -
Dividends 217,134 154,962
Other income 40 -
Total Income 269,554 154,962
Expenses:
Advisory fees (note 2) 87,938 84,220
Administration fees (note 2) 10,992 10,528
Transfer agent fees (note 2) 9,000 -
Fund accounting fees (note 2) 14,379 14,342
Compliance services fees (note 2) 2,293 2,293
Custody fees (note 2) 2,781 3,235
Distribution and service fees (note 3) 21,985 21,055
Other accounting fees (note 2) 1,008 1,472
Legal fees 6,234 6,234
Audit and tax preparation fees 6,981 6,482
Registration and filing expenses 12,466 12,466
Shareholder servicing expenses 872 997
Printing expenses 298 748
Trustees' fees and expenses 2,617 2,493
Securities pricing fees 2,522 879
Other operating expenses 1,995 1,995
Total Expenses 184,361 169,439
Advisory fees waived (note 2) (23,729) (9,211)
Administration fees waived (note 2) (4,843) (10,528)
Other accounting fees waived (note 2) (1,008) (1,472)
Fund accounting fees waived (note 2) (879) (842)
Net Expenses 153,902 147,386
Net Investment Income 115,652 7,576
Net Realized and Unrealized Gain on Investments:
Net realized gain from investment transactions 94,632 235,151
Change in unrealized appreciation on investments 786,185 1,515,232
Net Realized and Unrealized Gain on Investments 880,817 1,750,383
Net Increase in Net Assets Resulting from Operations $ 996,469 $ 1,757,959
See Notes to Financial Statements.
Hillman Capital Management Funds
Statements of Changes in Net Assets
Total Return Fund
March 31, September 30,
For the period and fiscal year ended 2005 (a) 2004
- -----------------------------------------------------------------------------------------------------------------------------------
Operations:
Net investment income $ 115,652 $ 163,709
Net realized gain from investment transactions 94,632 356,595
Change in unrealized appreciation on investments 786,185 1,152,025
Net Increase in Net Assets Resulting from Operations 996,469 1,672,329
Distributions to Shareholders: (note 5)
Net investment income (103,073) (110,069)
Net realized gain from investment transactions (283,131) -
Decrease in Net assets Resulting from Distributions (386,204) (110,069)
Capital Share Transactions: (note 6)
Shares sold 2,401,043 2,911,677
Reinvested dividends and distributions 385,846 110,069
Shares repurchased (507,331) (984,519)
Increase from Capital Share Transactions 2,279,558 2,037,227
Net Increase in Net Assets 2,889,823 3,599,487
Net Assets:
Beginning of Period 15,353,580 11,754,093
End of Period $ 18,243,403 $ 15,353,580
Undistributed Net Investment Income $ 67,017 $ 54,438
Aggressive Equity Fund
March 31, September 30,
For the period and fiscal year ended 2005 (a) 2004
- -----------------------------------------------------------------------------------------------------------------------------------
Operations:
Net investment income $ 7,576 $ 32,214
Net realized gain from investment transactions 235,151 94,656
Change in unrealized appreciation on investments 1,515,232 1,201,704
Net Increase in Net Assets Resulting from Operations 1,757,959 1,328,574
Distributions to Shareholders: (note 5)
Net investment income (10,478) (7,527)
Decrease in Net Assets Resulting from Distributions (10,478) (7,527)
Capital Share Transactions: (note 6)
Shares sold 8,004,418 6,700,855
Reinvested dividends and distributions 10,240 7,383
Shares repurchased (1,033,673) (1,335,088)
Increase from Capital Share Transactions 6,980,985 5,373,150
Net Increase in Net Assets 8,728,466 6,694,197
Net Assets:
Beginning of Period 11,850,878 5,156,681
End of Period $ 20,579,344 $ 11,850,878
Undistributed Net Investment Income $ 21,918 $ 24,820
(a) Unaudited.
See Notes to Financial Statements
Hillman Capital Management Funds
Financial Highlights
Total Return Fund
For a share outstanding during the March 31, September 30,
-------------------------------------------------------
periods and fiscal years ended 2005 (a) 2004 2003 2002 2001 (b)
- ---------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Year $ 11.56 $ 10.25 $ 8.51 $ 8.77 $ 10.00
Income from Investment Operations:
Net investment income 0.07 0.13 0.14 0.10 0.01
Net realized and unrealized
gains/(losses) on securities 0.63 1.27 1.83 (0.25) (1.24)
Total from Investment Operations 0.70 1.40 1.97 (0.15) (1.23)
Less Distributions:
Dividends (from net investment income) (0.07) (0.09) (0.15) (0.11) -
Distributions (from capital gains) (0.19) - (0.08) - -
Total Distributions (0.26) (0.09) (0.23) (0.11) -
Net Asset Value, End of Period $ 12.00 $ 11.56 $ 10.25 $ 8.51 $ 8.77
Total Return 6.04% 13.63% 23.46% (1.56)% (12.50)%
Net Assets, End of Period (in thousands) $ 18,243 $ 15,354 $ 11,754 $ 6,288 $ 5,926
Average Net Assets for the Period (in thousands) $ 17,636 $ 14,244 $ 8,448 $ 6,715 $ 4,220
Ratio of Gross Expenses to Average Net Assets 2.10% (c) 2.24% 2.61% 2.83% 4.22% (c)
Ratio of Net Expenses to Average Net Assets 1.75% (c) 1.75% 1.83% 1.80% 2.78% (c)
Ratio of Net Investment
Income to Average Net Assets 1.32% (c) 1.15% 1.62% 1.11% 0.27% (c)
Portfolio Turnover Rate 6.25% 17.14% 19.71% 40.37% 6.03%
Aggressive Equity Fund
For a share outstanding during the March 31, September 30,
-------------------------------------------------------
periods and fiscal years ended 2005 (a) 2004 2003 2002 2001 (b)
- ---------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Year $ 11.82 $ 9.63 $ 6.55 $ 7.51 $ 10.00
Income from Investment Operations:
Net investment income/(loss) - 0.03 0.04 (0.04) (0.12)
Net realized and unrealized
gains/(losses) on securities 1.44 2.17 3.08 (0.92) (2.37)
Total from Investment Operations 1.44 2.20 3.12 (0.96) (2.49)
Less Distributions:
Dividends (from net investment income) (0.01) (0.01) (0.04) - -
Total Distributions (0.01) (0.01) (0.04) - -
Net Asset Value, End of Period $ 13.25 $ 11.82 $ 9.63 $ 6.55 $ 7.51
Total Return 12.17% 22.82% 47.60% (12.67)% (25.00)%
Net Assets, End of Period (in thousands) $ 20,579 $ 11,851 $ 5,157 $ 2,977 $ 2,864
Average Net Assets for the Period (in thousands) $ 16,890 $ 8,329 $ 3,879 $ 3,628 $ 2,351
Ratio of Gross Expenses to Average Net Assets 2.01% (c) 2.58% 3.93% 4.06% 6.32% (c)
Ratio of Net Expenses to Average Net Assets 1.75% (c) 1.75% 2.10% 2.12% 3.90% (c)
Ratio of Net Investment
Income/(Loss) to Average Net Assets 0.09% (c) 0.39% 0.53% (0.46)% (2.53)%(c)
Portfolio Turnover Rate 11.33% 37.80% 41.37% 67.29% 52.56%
(a) Unaudited.
(b) From the period from December 29, 2000 (Date of Initial Public Investment) to September 30, 2001.
(c) Annualized.
See Notes to Financial Statements.
Hillman Capital Management Funds
Notes to Financial Statements (Unaudited)
- -------------------------------------------------------------------------------
1. Organization and Significant Investment Transactions and Investment
Accounting Policies Income
Investment transactions are accounted
The Hillman Total Return Fund and The for as of the date purchased or sold
Hillman Aggressive Equity Fund (trade date). Dividend income is
(collectively the "Funds" and recorded on the ex-dividend date.
individually a "Fund") are series Certain dividends from foreign
funds. The Funds are part of the securities will be recorded as soon as
Hillman Capital Management Investment the Trust is informed of the dividend
Trust (the "Trust"), which was if such information is obtained
organized as a Delaware Business Trust subsequent to the ex-dividend date.
and is registered under the Investment Interest income is recorded on the
Company Act of 1940, (the "Act"), as accrual basis and includes
amended, as an open-ended management amortization of discounts and
investment company. premiums. Gains and losses are
determined on the identified cost
The Hillman Total Return Fund ("Total basis, which is the same basis used
Return Fund") commenced operations on for federal income tax purposes.
December 29, 2000 and began operations
on January 2, 2001. The investment Expenses
objective of the Fund is to seek total The Funds bears expense incurred
return through a combination of specifically on its behalf as well as
capital appreciation and current a portion of general expenses, which
income. are allocated according to methods
approved annually by the Trustees.
The Hillman Aggressive Equity Fund
("Aggressive Equity Fund") commenced Dividend Distributions
operations on December 29, 2000 and The Funds may declare and distribute
began operations on January 2, 2001. dividends from net investment income
The investment objective of the Fund (if any) at the end of each calendar
is to seek long-term capital quarter. Distributions from capital
appreciation. gains (if any) are generally declared
and distributed annually.
The following accounting policies have
been consistently followed by the Estimates
Funds and are in conformity with The preparation of financial
accounting principles generally statements in conformity with
accepted in the United States of accounting principles generally
America in the investment company accepted in the United States of
industry. America requires management to make
estimates and assumptions that affect
Investment Valuation the amount of assets, liabilities,
The Funds' investments in securities expenses and revenues reported in the
are carried at value. Securities financial statements. Actual results
listed on an exchange or quoted on a could differ from those estimates.
national market system are valued at
the last sales price as of 4:00 p.m. Federal Income Taxes
Eastern Time. Other securities traded No provision for income taxes is
in the over-the-counter market and included in the accompanying financial
listed securities for which no sale statements, as the Funds intend to
was reported on that date are valued distribute to shareholders all taxable
at the most recent bid price. investment income and realized gains
Securities and assets for which and otherwise comply with Subchapter M
representative market quotations are of the Internal Revenue Code
not readily available (e.g., if the applicable to regulated investment
exchange on which the portfolio companies.
security is principally traded closes
early or if trading of the particular Indemnifications
portfolio security is halted during Under the Funds' organizational
the day and does not resume prior to documents, its officers and Trustees
the Funds' net asset value are indemnified against certain
calculation) or which cannot be liabilities arising out of the
accurately valued using the Funds' performance of their duties to the
normal pricing procedures are valued Funds. In addition, in the normal
at fair value as determined in good course of business, the Funds entered
faith under policies approved by the into contracts with their vendors and
Trustees. A portfolio security's "fair others that provide for general
value" price may differ from the price indemnifications. The Funds' maximum
next available for that portfolio exposure under these arrangements is
security using the Funds' normal unknown, as this would involve future
pricing procedures. Instruments with claims that may be made against the
maturities of 60 days or less are Funds. The Funds expect that risk of
valued at amortized cost, which loss to be remote.
approximates market value.
(Continued)
Hillman Capital Management Funds
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
Proxy Voting Policies and Voting financial capability, and other
Record (Unaudited) information.
A copy of the Trust's Proxy Voting and
Disclosure Policy and the Advisor's In deciding on whether to approve the
Proxy Voting and Disclosure Policy are continuation of the Investment
included as Appendix B to the Fund's Advisory Agreement, the Trustees
Statement of Additional Information considered numerous factors,
and is available, without charge, upon including: (i) the nature, extent, and
request, by calling 1-800-773-3863. quality of the services provided by
After June 30, 2004, information the Advisor; (ii) the Advisor's
regarding how the Fund voted proxies personnel and methods of operating;
relating to portfolio securities (iii) the financial condition of the
during the most recent 12-month period Advisor and the level of commitment by
ended June 30 will be available (1) the principals of the Advisor; (iv)
without charge, upon request, by the Advisor's investment strategy for
calling the Fund at the number above the Funds; (v) the short and long term
and (2) on the SEC's website at investment performance of the Funds
http://www.sec.gov. and Advisor; (vi) the costs of the
services to be provided and profits to
Quarterly Portfolio Holdings be realized by the Advisor and its
(Unaudited) affiliates from the relationship with
The Fund files its complete schedule the Funds; (vii) overall expenses of
of portfolio holdings with the SEC for the Funds, including certain fee
the first and third quarters of each waivers by the Advisor and other
fiscal year on Form N-Q. The Fund's service providers on behalf of the
Forms N-Q are available on the SEC's Funds; (viii) the extent to which
website at http://www.sec.gov. You may economies of scale would be realized
review and make copies at the SEC's as the Funds grow; and (ix) whether
Public Reference Room in Washington, advisory fee levels reflect these
D.C. You may also obtain copies after economies of scale for the benefits of
paying a duplicating fee by writing the Funds' investors.
the SEC's Public Reference Section,
Washington, D.C. 20549-0102 or by The Board indicated that based upon
electronic request to its evaluation of the information and
publicinfo@sec.gov, or is available materials provided to the Board and
without charge, upon request, by the above factors, the Board concluded
calling the Fund at 1-800-773-3863. for each Fund: (i) that the terms of
Information on the operation of the the Investment Advisory Agreement were
Public Reference Room may be obtained reasonable and fair; (ii) that the
by calling the SEC at 202-942-8090. fees paid to the Advisor under the
Investment Advisory Agreement and the
Fund's expense ratio as compared to
2. Agreements similar funds were reasonable and
fair; (iii) that they were satisfied
Advisor with the Advisor's services,
The Funds pays a monthly advisory fee personnel, and investment strategy;
to Hillman Capital Management, Inc. and (iv) that it was in the best
(the "Advisor") based upon the average interest of the Trust, the Fund, and
daily net assets of the Fund and the shareholders of the Fund to
calculated at the annual rates as continue the relationship with the
shown in the schedule provided below. Advisor.
The Advisor has voluntarily waived a
portion of its fee for the period Administrator
ended March 31, 2005, included in the Each Fund pays a monthly
table below. There can be no assurance administration fee to The Nottingham
that the foregoing voluntary waiver Company ("the Administrator) based
will continue. upon the average daily net assets of
the Fund and calculated at the annual
- -------------------------------------- rates as shown in the following
Fund Advisor Fees schedule which is subject to a minimum
-------------- Advisor of $2,000 per month per fund. The
Average Fees Administrator also receives a fee to
Net Assets Rate Waived procure and pay the custodian for the
- -------------------------------------- fund, additional compensation for fund
Total Return accounting and recordkeeping services,
Fund On all assets 1.00% $23,729 and additional compensation for
Aggressive On all assets 1.00% $9,211 certain costs involved with the daily
Equity Fund valuation of securities and as
- ---------------------------------------- reimbursement for out-of-pocket
expenses (which are immaterial in
On December 14, 2004, the Board amount). A breakdown of these is
reviewed information necessary to provided in the following schedule.
approve the continuation of the The Administrator has voluntarily
Investment Advisory Agreement. The waived a portion of its fee for the
Advisor reviewed with the Board the period ended March 31, 2005. There can
Advisor's Form ADV, its experience, be no assurance that the foregoing
its profitability with respect to the voluntary waiver will continue in the
Fund, its financial strength, its future.
(Continued)
Hillman Capital Management Funds
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
Fund
Administration Fees (1) Custody Fees Accounting Blue Sky
----------------------- ------------
Average Annual Average Annual Fees (2) Administration
Net Assets Rate Net Assets Rate (monthly) Fees (annual)
- -------------------------------------------------------------------------------------------------------
All Funds First $50 million 0.125% First $100 million 0.02% $2,250 $150 per state
Next $50 million 0.100% Over $100 million 0.009%
Over $100 million 0.075%
- -------------------------------------------------------------------------------------------------------
(1) The Administrator waived administration fees for the Total Return Fund and
the Aggressive Equity Fund in the amount of $4,843 and $10,528,
respectively, as well as $1,008 of related minimum fees for the Total
Return Fund and $1,472 for the Aggressive Equity Fund for the period ended
March 31, 2005.
(2) The Administrator waived fund accounting fees for the Total Return Fund and
the Aggressive Equity Fund in the amount of $879 and $842, respectively,
for the period ended March 31, 2005.
Compliance Services
The Nottingham Compliance Services, the Plan for the period ended March
LLC, a fully owned affiliate of The 31, 2005. The Aggressive Equity Fund
Nottingham Company, provides services incurred $21,055 in distribution and
which assists the Trust's Chief service fees under the Plan for the
Compliance Officer in monitoring and period ended March 31, 2005.
testing the policies and procedures of
the Trust in conjunction with
requirements under Rule 38a-1 of the 4. Purchases and Sales of Investment
Securities and Exchange Commission. It Securities
receives compensation for this service
at an annual rate of $7,750. For the period ended March 31, 2005,
the aggregate cost of purchases and
Transfer Agent proceeds from sales of investment
North Carolina Shareholder Services, securities (excluding short-term
LLC ("Transfer Agent") serves as securities) were as follows:
transfer, dividend paying, and
shareholder servicing agent for the --------------------------------------
Funds. It receives compensation for Proceeds from
its services based upon $15 per Purchases of Sales of
shareholder per year, subject to a Fund Securities Securities
minimum fee of $1,500 per month. --------------------------------------
Total Return
Certain Trustees and officers of the Fund $2,208,559 $952,579
Trust are also officers of the Aggressive
Advisor, the Distributor or the Equity Fund $8,006,872 $1,837,892
Administrator. --------------------------------------
There were no purchases or sales of
3. Distribution and Service Fees long-term U.S. Government Obligations
for either Fund during the period
The Trustees, including a majority of ended March 31, 2005.
the Trustees who are not "interested
persons" of the Trust as defined in
the Act, adopted a distribution plan 5. Federal Income Tax
with respect to all shares pursuant to
Rule 12b-1 of the Act (the "Plan"). The tax components of capital shown in
Rule 12b-1 regulates the manner in the table below represent: (1)
which a regulated investment company distribution requirements the Funds
may assume costs of distributing and must satisfy under the income tax
promoting the sales of its shares and regulations, (2) losses or deductions
servicing of its shareholder accounts. the Funds may be able to offset
against income and gains realized in
The Plan provides that the Funds may future years, and (3) unrealized
incur certain costs, which may not appreciation or depreciation of
exceed 0.25%, for each year elapsed investments for federal income tax
subsequent to adoption of the Plan, purposes as of September 30, 2004.
for payment to the distributor and
others for items such as advertising Other book tax differences in the
expenses, selling expenses, current year primarily consist of
commissions, travel or other expenses adjustments due to reclassifications
reasonably intended to result in sales of income received from investments in
of shares of the Funds or support real estate investment trusts.
servicing of shareholder accounts. The
Total Return Fund incurred $21,985 in
distribution and service fees under
(Continued)
Hillman Capital Management Funds
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
Fund Undistributed Accumulated Other Book to Net Tax
Ordinary Undistributed Capital Tax Appreciation/
Income Long-Term Gains Losses Differences (Depreciation)
- ---------------------------------------------------------------------------------------------------------------------
Total Return Fund (1) $85,836 $202,942 $0 $27,297 $1,857,673
Aggressive Equity Fund (1) $10,470 $0 $36,999 $36,495 $1,684,941
- ---------------------------------------------------------------------------------------------------------------------
(1) Capital loss carry-forwards subject to annual limitations
Accumulated capital losses noted below distributions. The table below shows
represent net capital loss the expiration dates of the carryovers
carry-forwards, as of September 30, for the Total Return Fund and
2004, that may be available to offset Aggressive Equity Fund as of September
future realized capital gains and 30, 2004.
thereby reduce future taxable gains
- ---------------------------------------------------------------------------------------------------------------------
Capital Loss Carry-forward Expiration Schedule
For the year ended September 30, 2004
- ---------------------------------------------------------------------------------------------------------------------
September 30, September 30, September 30, September 30, September 30,
Fund 2006 2007 2008 2009 2010
- ---------------------------------------------------------------------------------------------------------------------
Total Return Fund (1) $0 $0 $0 $0 $0
Aggressive Equity Fund (1) $0 $0 $0 $36,999 $0
- ---------------------------------------------------------------------------------------------------------------------
(1) Capital loss carry-forwards subject to annual limitations
The aggregate cost of investments and 2005 are noted below. The primary
the composition of unrealized difference between book and tax
appreciation and depreciation of appreciation or depreciation of
investment securities for federal investments is wash sale loss
income tax purposes as of March 31, deferrals.
- ---------------------------------------------------------------------------------------------------------------------
Fund Aggregate Gross Aggregate Gross Unrealized
Federal Tax Cost Unrealized Appreciation Depreciation
- ---------------------------------------------------------------------------------------------------------------------
Total Return Fund $15,537,339 $3,017,342 ($371,680)
Aggressive Equity Fund $17,181,161 $3,301,526 ($98,991)
- ---------------------------------------------------------------------------------------------------------------------
The amount of dividends and sale losses, foreign currency
distributions from net investment transactions, net investment losses
income and net realized capital gains and capital loss carry-forwards.
are determined in accordance with Permanent differences such as tax
federal income tax regulations which returns of capital and net investment
may differ from generally accepted losses, if any, would be reclassified
accounting principles. These against capital.
differences are due to differing
treatments for items such as net
short-term gains, deferral of wash
- ---------------------------------------------------------------------------------------------------------------------
For the year ended September 30, 2004 Distributions from
Ordinary Long-Term Tax Return of Net Investment
Fund Income Capital Gains Capital Loss
- ---------------------------------------------------------------------------------------------------------------------
Total Return Fund $7,527 $0 $0 $0
Aggressive Equity Fund $110,069 $0 $0 $0
- ---------------------------------------------------------------------------------------------------------------------
(Continued)
Hillman Capital Management Funds
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
6. Capital Share Transactions
- ------------------------------------------- ------------------------------------------- --------------------------------------------
Total Return Fund Aggressive Equity Fund
For the periods and fiscal years ended March 31,2005 (a) September 30, 2004 March 31,2005 (a) September 30, 2004
- ------------------------------------------- --------------------- --------------------- ---------------------- ---------------------
Transactions in Fund Shares
Shares sold 201,938 258,446 630,211 584,052
Reinvested distributions 31,592 9,644 769 624
Shares repurchased (42,169) (86,541) (80,363) (117,306)
Net Increase/(Decrease) in Capital Share
Transactions 191,361 181,549 550,617 467,370
Shares Outstanding, Beginning of Period 1,328,392 1,146,843 1,002,971 535,601
Shares Outstanding, End of Period 1,519,753 1,328,392 1,553,588 1,002,971
- ------------------------------------------- --------------------- --------------------- ---------------------- ---------------------
(a) Unaudited.
7. Changes in Registrant's
Certifying Accountant
On December 14, 2005, Deloitte & satisfaction of Deloitte & Touche LLP,
Touche LLP was removed as the would have caused it to make reference
independent registered public to the subject matter of the
accounting firm for the Trust. disagreements in connection with its
Deloitte & Touche LLP was previously report. At no time preceding the
engaged as the independent registered removal of Deloitte & Touche LLP did
public accounting firm to audit the any of the events enumerated in
Funds' financial statements. paragraphs (1)(v)(A) through (D) of
Deloitte & Touche LLP issued Item 304(a) of Regulation S-K occur.
reports on the Funds' financial The Trust engaged Briggs Bunting
statements as of September 30, 2004 & Dougherty, LLP as its new
and 2003. Such reports did not contain independent registered public
an adverse opinion or a disclaimer of accounting firm on December 14, 2005.
opinion, nor were they qualified or At no time preceding the engagement of
modified as to uncertainty, audit Briggs Bunting & Dougherty, LLP did
scope, or accounting principles. the Funds consult Briggs Bunting &
The decision to remove Deloitte & Dougherty, LLP regarding either (i)
Touche LLP was approved by the Trust's the application of accounting
Audit Committee and ratified by the principles to a specified transaction,
Board of Trustees. either completed or proposed, or the
At no time preceding the removal type of audit opinion that might be
of Deloitte & Touche LLP were there rendered on the Funds' financial
any disagreements with Deloitte & statements, or (ii) any matter that
Touche LLP on any matter of accounting was either the subject of a
principles or practices, financial disagreement or a reportable event, as
statement disclosure, or auditing such terms are defined in Item 304 of
scope or procedure, which Regulation S-K.
disagreements, if not resolved to the
(This page was intentionally left blank.)
The Hillman Capital Management
Mutual Funds are a series of the
Hillman Capital Management Investment Trust
For Shareholder Service Inquiries: For Investment Advisor Inquiries:
Documented: Documented:
NC Shareholder Services Hillman Capital Management, Inc.
116 South Franklin Street 4733 Bethesda Avenue
Post Office Drawer 4365 Suite 325
Rocky Mount, North Carolina 27802 Bethesda, Maryland 20814
Toll-Free Telephone: Toll-Free Telephone:
1-800-773-3863 1-800-773-3863
World Wide Web @: World Wide Web @:
nottinghamco.com hillmancapital.com
[Company logo here]
HILLMAN
capital management
Item 2. CODE OF ETHICS.
--------------
Not applicable.
Item 3. AUDIT COMMITTEE FINANCIAL EXPERT.
--------------------------------
Not applicable.
Item 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
--------------------------------------
Not applicable.
Item 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
-------------------------------------
Not applicable.
Item 6. SCHEDULE OF INVESTMENTS.
-----------------------
A copy of the schedule of investments of unaffiliated issuers as of the
close of the reporting period is included as part of the report to
shareholders filed under Item 1 of this Form.
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 SECURITYHOLDERS.
--------------------------------------------------
None.
Item 11. 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 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.
--------
(a)(1) Not applicable.
(a)(2) Certifications required by Item 12.(a)(2) of Form N-CSR are filed
herewith as Exhibit 12.(a)(2).
(b) Certifications required by Item 12.(b) of Form N-CSR are filed herewith
as Exhibit 12.(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 26, 2005
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 26, 2005
By: (Signature and Title) /s/ Fletcher D. Perkins
_________________________
Fletcher D. Perkins, Treasurer and
Principal Financial Officer
Date: May 26, 2005