As filed with the Securities and Exchange Commission on August 31, 2007
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 811-08507
IRONWOOD SERIES TRUST
Two Portland Square
Portland, Maine 04101
207-879-1900
Warren J. Isabelle, President
Suite 240
21 Custom House Street
Boston, MA 02109
(800) 472-6114
Date of fiscal year end: DECEMBER 31
Date of reporting period: JANUARY 1, 2007 - JUNE 30, 2007
ITEM 1. REPORT TO STOCKHOLDERS.
[LOGO OF IRONWOOD FUNDS]
Ironwood Series Trust
www.ironwoodfunds.com
-----------------
Ironwood Isabelle Small Company
Stock Fund
Investment Shares Symbol: IZZYX
Institutional Shares Symbol: IZZIX
Semi-Annual Report
June 30, 2007
(Unaudited)
Ironwood Isabelle Small Company Stock Fund
Table Of Contents
SHAREHOLDER LETTER......................................................... 1
PORTFOLIO OF INVESTMENTS................................................... 7
STATEMENT OF ASSETS AND LIABILITIES........................................ 10
STATEMENT OF OPERATIONS.................................................... 11
STATEMENTS OF CHANGES IN NET ASSETS........................................ 12
FINANCIAL HIGHLIGHTS....................................................... 14
NOTES TO FINANCIAL STATEMENTS.............................................. 18
ADDITIONAL INFORMATION..................................................... 25
Ironwood Isabelle Small Company Stock Fund Shareholder Letter
To our shareholders:
For the first half of the year, the six month period ending June 30, 2007, I am
pleased to report that the Ironwood Isabelle Small Company Stock Fund (the
"Fund") Investment Shares had a total return of 8.92%, versus its benchmark
index, the Russell 2000 Index (the "Index"), which returned 6.45%. This
represents a continuation of the success of our efforts which have produced one
and three year average annual returns for the period ending June 30, 2007 of
23.94% and 15.60%, respectively, against those of the Index of 16.43% and
13.45%, respectively. For a longer term perspective, the Fund's 5-year and
since inception (03/09/98) average annual returns were 11.52% and 9.64%,
respectively.
For this writing I am forgoing my typical letter to you which admittedly
devolves into a broad discussion of current macroeconomic trends and happenings
followed by a somewhat impassioned explanation of why and how we are different:
Our forte is seeking out those interesting situations which we can then
scrutinize to a level that will allow us to develop a detailed investment
thesis for each. The common element to all is a meaningful mismatch in our view
of economic value versus what the market is currently affording. Enough said:
Rather than again continuing to travel down a well worn path, let me just
describe how I think we accomplished the job for the period.
PERFORMANCE DATA IS FOR THE PERIOD ENDED 06/30/07, REPRESENTS PAST PERFORMANCE
AND IS NO GUARANTEE OF FUTURE RESULTS. CURRENT PERFORMANCE MAY BE HIGHER OR
LOWER THAN THE PERFORMANCE DATA QUOTED. INVESTMENT RETURN AND PRINCIPAL VALUE
WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN ORIGINAL COST. AS STATED IN THE FUND'S PROSPECTUS, THE FUND'S
ANNUAL OPERATING EXPENSE RATIO (GROSS) FOR INVESTMENT SHARES IS 2.14%. HOWEVER,
THE FUND'S ADVISER HAS CONTRACTUALLY AGREED TO WAIVE A PORTION OF ITS FEES
AND/OR REIMBURSE EXPENSES SUCH THAT TOTAL OPERATING EXPENSES DO NOT EXCEED
1.95%. CONTRACTUAL WAIVERS MAY BE CHANGED OR ELIMINATED AT ANY TIME WITH THE
CONSENT OF THE BOARD OF TRUSTEES. FOR THE MOST RECENT MONTH-END PERFORMANCE,
PLEASE CALL 800-472-6114.
1
We submit that performance is ultimately governed by the merit of our portfolio
selections: The portfolio should thus fare as the net sum of its individual
heroes and villains, and the best way to portray the overall result is to
detail how the important participants behaved.
The year started much as the last had ended, with the culmination of a number
of portfolio holdings either being acquired or becoming the object of merger
and acquisition activity. The transaction initiated by Merck (NYSE: MRK) to
purchase Sirna Therapeutics (formerly Nasdaq: (RNAI) was completed literally on
the first trading day of the new year, and was followed by the closing of Level
Three's (Nasdaq: LVLT) acquisition of Broadwing (formerly Nasdaq: BWNG) for
stock, which afforded the portfolio an opportunity to avail itself of an
additional gain of 22% as investors gained an understanding of the benefits
this addition offered. Shortly thereafter, a unit of Goldman Sachs decided to
enter the insurance brokerage business by acquiring yet another of our
investments, USI Holdings (formerly Nasdaq:USIH), and finally, long held time
share resort purveyor Sunterra (formerly OTC: SNRR) was bought by Diamond
Resorts. This strong start helped carry the portfolio toward its good first
half performance, with most markets pushing higher as well.
Notable decliners included Proliance (AMEX: PLI), a manufacturer and
distributor of after-market automotive heat-exchange equipment, down 31%, and
Novavax (Nasdaq: NVAX), a biopharmaceutical company developing truly novel
vaccine technology, down 29%. In each case we redoubled our efforts to
ascertain that our investment thesis remained intact and warranted further
patience. We visited the management of Proliance in Connecticut, and came away
feeling that the company had figured itself out so to speak in the global world
of manufacturing such that we believed there was yet a potential for positive
growth with proper execution of its business model. In the case of Novavax,
like many smaller development companies, no news is bad news, and that is just
the kind of short term difficulty we had to sit through.
The Fund's big winners reflected both the strength of the underlying companies
as businesses, but more importantly offered confirmation that these companies
are positioned well in the Fund's portfolio. Although the Fund has held many of
its portfolio names for 18 months or more and has derived substantial gains
from a good number of them, in most cases we believe that their full potential
has yet to be realized. That is how we feel about ICO Inc. (Nasdaq: ICOC) a
polymer and plastics processor,
2
which rose an amazing 87% during the first six months of the year. The stock
price has increased from the Fund's initial purchase around two years ago, some
five-fold, keeping in line with our investment thesis. Similarly, A M Castle
(NYSE: CAS), a distributor of value added metals, advanced 42%, and, despite a
seven-fold rise in price over the past several years, we believe there is
adequate appreciation to be had before our economic value target is reached. We
cite Hooker Furniture (Nasdaq: HOFT), which gained 45%, Petrohawk Energy (NYSE:
HK), up 38%, and Omnova Solutions (NYSE: OMN), up 32%, as other holdings that
position the Fund's portfolio well. It is important to note that past
performance is not an indicator of future results.
I am pleased to say that our changes to the portfolio were fairly modest,
precipitated in part by the aforementioned acquisitions and the sale of Dynegy
(NYSE: DYN) which reached its target price. New entries to the portfolio came
from a broad cross section of the economy: Allied Defense Group (AMEX: ADG), a
diversified defense company which upgrades older weapons and logistics
platforms; Ampco-Pittsburgh (NYSE:AP), the only major domestic manufacturer of
calendaring rolls for steel mills; C E Franklin (AMEX: CFK), a leading supplier
of oil and gas exploration and development tools and supplies for central and
western Canada; Citizens First Bancorp (Nasdaq: CTZN), a smaller eastern
Michigan based community bank; Gene Logic (Nasdaq: GLGC), formerly a genetics
discovery company now collaborating with large pharmaceutical companies to
apply genetic expertise to the revamping of older or previously discontinued
drug candidates; Industrial Enterprises of America (Nasdaq: IEAM), a turnaround
situation involved in the packaging and marketing of refrigerants and specialty
automotive chemicals and additives; and finally International Coal (NYSE: ICO),
a coal mining company with locations in Appalachia and Illinois.
To be sure, we might have done better, but aside from timing issues and forced
turnover as described above we believe that the strength and return potential
of the current portfolio maintains.
In closing I trust that this more granular analysis of individual performance
provides better insight into how we perceive the task of portfolio management.
We will continue to put forth our best efforts in approaching that task on
behalf of our shareholders, in the sincere belief that 'hard work' pays.
3
As always we appreciate the support of our shareholders and look forward to
reporting to you in the future.
Respectfully submitted,
[Signature of Warren J. Isabelle]
Warren J. Isabelle
Portfolio Manager
- --------
INVESTMENTS IN SMALLER COMPANIES CARRY GREATER RISK THAN IS CUSTOMARILY
ASSOCIATED WITH LARGER COMPANIES FOR VARIOUS REASONS SUCH AS NARROWER
PRODUCT LINES, LIMITED FINANCIAL RESOURCES AND LESS DEPTH IN MANAGEMENT.
RETURNS SHOWN ARE FOR THE FUND'S INVESTMENT SHARES; OTHER SHARE CLASS
RETURNS WILL VARY.
THE VIEWS IN THIS REPORT WERE THOSE OF THE FUND MANAGER AS OF JUNE 30, 2007
UNLESS OTHERWISE NOTED, AND MAY NOT REFLECT HIS VIEWS ON THE DATE THIS
REPORT IS FIRST PUBLISHED OR ANYTIME THEREAFTER. THESE VIEWS ARE INTENDED TO
ASSIST SHAREHOLDERS IN UNDERSTANDING THEIR INVESTMENTS IN THE FUND AND DO
NOT CONSTITUTE INVESTMENT ADVICE.
4
Ironwood Isabelle Small Company Stock Fund
Investment Class
Illustration Of $10,000 Investment
The graph below reflects the change in value of a hypothetical $10,000
investment in the Ironwood Isabelle Small Company Stock Fund (the "Fund")
Investment Class compared with a broad-based securities market index since the
Investment Class' inception. The Russell 2000 Index is composed of the 2,000
smallest stocks in the Russell 3000 Index, a market weighted index of the 3,000
largest U.S. publicly traded companies. The Fund is professionally managed
while the Index is unmanaged and not available for investment.
IRONWOOD ISABELLE SMALL COMPANY STOCK
INVESTMENT VALUE REPORT
FUND INCEPTION (3/9/1998) TO 6/30/2007
Fund Number:
Fund Name:
Initial Investment:
Benchmark:
Datapoint Frequency:
Currency:
3800101 RUSSELL2000
DATE
----
3/9/1998 10,000 10,000
3/31/1998 10,000 10,431
4/30/1998 9,900 10,488
5/31/1998 9,460 9,924
6/30/1998 9,040 9,944
7/31/1998 7,770 9,139
8/31/1998 5,910 7,365
9/30/1998 6,110 7,941
10/31/1998 6,480 8,265
11/30/1998 6,730 8,698
12/31/1998 6,910 9,236
1/31/1999 7,250 9,359
2/28/1999 6,920 8,601
3/31/1999 6,690 8,735
4/30/1999 7,550 9,518
5/31/1999 8,260 9,657
6/30/1999 8,390 10,094
7/31/1999 8,390 9,817
8/31/1999 8,390 9,453
9/30/1999 8,250 9,455
10/31/1999 8,370 9,494
11/30/1999 9,280 10,061
12/31/1999 10,330 11,199
1/31/2000 10,860 11,020
2/29/2000 11,690 12,839
3/31/2000 11,880 11,993
4/30/2000 11,740 11,271
5/31/2000 11,260 10,614
6/30/2000 11,690 11,540
7/31/2000 11,530 11,168
8/31/2000 11,710 12,020
9/30/2000 12,050 11,667
10/31/2000 11,300 11,146
11/30/2000 10,840 10,002
12/31/2000 11,129 10,861
1/31/2001 12,009 11,427
2/28/2001 11,835 10,677
3/31/2001 11,794 10,155
4/30/2001 12,347 10,949
5/31/2001 13,043 11,218
6/30/2001 14,067 11,605
7/31/2001 12,808 10,977
8/31/2001 12,224 10,623
9/30/2001 9,972 9,193
10/31/2001 10,545 9,731
11/30/2001 11,067 10,484
12/31/2001 12,101 11,131
1/31/2002 12,071 11,015
2/28/2002 11,886 10,713
3/31/2002 13,699 11,575
4/30/2002 13,955 11,680
5/31/2002 13,473 11,162
6/30/2002 13,658 10,608
7/31/2002 11,549 9,006
8/31/2002 10,965 8,983
9/30/2002 9,829 8,338
10/31/2002 9,798 8,605
11/30/2002 10,811 9,373
12/31/2002 9,992 8,851
1/31/2003 9,409 8,606
2/28/2003 8,559 8,346
3/31/2003 8,426 8,454
4/30/2003 9,378 9,255
5/31/2003 10,494 10,248
6/30/2003 11,108 10,434
7/31/2003 11,293 11,087
8/31/2003 12,081 11,595
9/30/2003 11,999 11,381
10/31/2003 12,736 12,337
11/30/2003 13,310 12,774
12/31/2003 14,129 13,034
1/31/2004 14,722 13,600
2/29/2004 15,040 13,722
3/31/2004 14,866 13,850
4/30/2004 14,907 13,143
5/31/2004 14,630 13,353
6/30/2004 15,255 13,915
7/31/2004 13,944 12,978
8/31/2004 13,617 12,911
9/30/2004 14,303 13,517
10/31/2004 14,323 13,784
11/30/2004 15,582 14,979
12/31/2004 16,688 15,423
1/31/2005 16,023 14,779
2/28/2005 16,350 15,029
3/31/2005 15,767 14,599
4/30/2005 14,518 13,763
5/31/2005 15,337 14,664
6/30/2005 16,176 15,229
7/31/2005 17,180 16,194
8/31/2005 16,811 15,894
9/30/2005 17,251 15,944
10/31/2005 16,606 15,449
11/30/2005 17,062 16,199
12/31/2005 17,491 16,125
1/31/2006 19,269 17,571
2/28/2006 19,821 17,522
3/31/2006 20,913 18,373
4/30/2006 20,717 18,370
5/31/2006 19,331 17,338
6/30/2006 19,012 17,449
7/31/2006 18,166 16,882
8/31/2006 19,417 17,381
9/30/2006 19,220 17,526
10/31/2006 21,453 18,535
11/30/2006 21,456 19,023
12/31/2006 21,633 19,087
1/31/2007 21,842 19,406
2/28/2007 21,810 19,252
3/31/2007 22,180 19,458
4/30/2007 22,357 19,808
5/31/2007 23,354 20,619
6/30/2007 23,563 20,317
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND IS NO GUARANTEE OF
FUTURE RESULTS. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE
DATA QUOTED. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN
INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN ORIGINAL COST.
FOR THE MOST RECENT MONTH END PERFORMANCE, PLEASE CALL (800) 472-6114. THE
PERFORMANCE TABLE AND GRAPH DO NOT REFLECT THE DEDUCTION OF TAXES THAT A
SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES.
TOTAL RETURN FIGURES INCLUDE THE REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS.
SOME OF THE FUND'S FEES HAVE BEEN WAIVED OR EXPENSES REIMBURSED; OTHERWISE
TOTAL RETURN WOULD HAVE BEEN LOWER.
5
Ironwood Isabelle Small Company Stock Fund
Institutional Class
Illustration Of $10,000 Investment
The graph below reflects the change in value of a hypothetical $10,000
investment in the Ironwood Isabelle Small Company Stock Fund (the "Fund")
Institutional Class compared with a broad-based securities market index since
the Institutional Class' inception. The Russell 2000 Index is composed of the
2,000 smallest stocks in the Russell 3000 Index, a market weighted index of the
3,000 largest U.S. publicly traded companies. The Fund is professionally
managed while the Index is unmanaged and not available for investment.
IRONWOOD ISABELLE SMALL COMPANY STOCK
INVESTMENT VALUE REPORT
FUND INCEPTION (3/27/1998) TO 6/30/2007
Fund Number:
Fund Name:
Initial Investment:
Benchmark:
Datapoint Frequency:
Currency:
3800102 RUSSELL2000
DATE
----
3/27/1998 10,000 10,000
3/31/1998 9,970 10,074
4/30/1998 9,870 10,130
5/31/1998 9,460 9,584
6/30/1998 9,040 9,605
7/31/1998 7,780 8,827
8/31/1998 5,920 7,113
9/30/1998 6,120 7,670
10/31/1998 6,480 7,982
11/30/1998 6,740 8,401
12/31/1998 6,920 8,920
1/31/1999 7,260 9,039
2/28/1999 6,940 8,307
3/31/1999 6,690 8,437
4/30/1999 7,560 9,193
5/31/1999 8,270 9,327
6/30/1999 8,400 9,749
7/31/1999 8,400 9,481
8/31/1999 8,400 9,130
9/30/1999 8,270 9,132
10/31/1999 8,390 9,169
11/30/1999 9,300 9,717
12/31/1999 10,360 10,817
1/31/2000 10,890 10,643
2/29/2000 11,720 12,400
3/31/2000 11,920 11,583
4/30/2000 11,780 10,886
5/31/2000 11,300 10,251
6/30/2000 11,740 11,145
7/31/2000 11,580 10,787
8/31/2000 11,760 11,610
9/30/2000 12,100 11,268
10/31/2000 11,350 10,765
11/30/2000 10,900 9,660
12/31/2000 11,179 10,490
1/31/2001 12,079 11,036
2/28/2001 11,905 10,312
3/31/2001 11,854 9,807
4/30/2001 12,417 10,575
5/31/2001 13,113 10,835
6/30/2001 14,147 11,209
7/31/2001 12,888 10,602
8/31/2001 12,315 10,260
9/30/2001 10,042 8,879
10/31/2001 10,636 9,398
11/30/2001 11,158 10,126
12/31/2001 12,233 10,751
1/31/2002 12,202 10,639
2/28/2002 12,018 10,347
3/31/2002 13,850 11,179
4/30/2002 14,116 11,281
5/31/2002 13,625 10,780
6/30/2002 13,820 10,245
7/31/2002 11,690 8,698
8/31/2002 11,107 8,676
9/30/2002 9,950 8,053
10/31/2002 9,930 8,311
11/30/2002 10,953 9,053
12/31/2002 10,124 8,549
1/31/2003 9,541 8,312
2/28/2003 8,681 8,061
3/31/2003 8,548 8,165
4/30/2003 9,510 8,939
5/31/2003 10,646 9,898
6/30/2003 11,281 10,077
7/31/2003 11,465 10,708
8/31/2003 12,264 11,199
9/30/2003 12,182 10,992
10/31/2003 12,939 11,915
11/30/2003 13,523 12,338
12/31/2003 14,362 12,588
1/31/2004 14,976 13,135
2/29/2004 15,294 13,253
3/31/2004 15,130 13,376
4/30/2004 15,171 12,694
5/31/2004 14,894 12,896
6/30/2004 15,539 13,439
7/31/2004 14,198 12,534
8/31/2004 13,871 12,470
9/30/2004 14,577 13,055
10/31/2004 14,598 13,312
11/30/2004 15,877 14,467
12/31/2004 17,013 14,895
1/31/2005 16,338 14,274
2/28/2005 16,676 14,516
3/31/2005 16,092 14,100
4/30/2005 14,813 13,293
5/31/2005 15,652 14,163
6/30/2005 16,563 14,709
7/31/2005 17,576 15,641
8/31/2005 17,218 15,351
9/30/2005 17,679 15,399
10/31/2005 17,013 14,921
11/30/2005 17,478 15,645
12/31/2005 17,918 15,574
1/31/2006 19,748 16,970
2/28/2006 20,334 16,923
3/31/2006 21,457 17,744
4/30/2006 21,262 17,742
5/31/2006 19,846 16,745
6/30/2006 19,517 16,853
7/31/2006 18,650 16,305
8/31/2006 19,944 16,787
9/30/2006 19,748 16,927
10/31/2006 22,043 17,902
11/30/2006 22,060 18,373
12/31/2006 22,234 18,434
1/31/2007 22,456 18,743
2/28/2007 22,424 18,594
3/31/2007 22,820 18,793
4/30/2007 23,011 19,130
5/31/2007 24,025 19,914
6/30/2007 24,247 19,623
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND IS NO GUARANTEE OF
FUTURE RESULTS. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE
DATA QUOTED. INVESTMENT RETURN AND PRINCIPAL VALUE WILL FLUCTUATE SO THAT AN
INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN ORIGINAL COST.
FOR THE MOST RECENT MONTH END PERFORMANCE, PLEASE CALL (800) 472-6114. THE
PERFORMANCE TABLE AND GRAPH DO NOT REFLECT THE DEDUCTION OF TAXES THAT A
SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES.
TOTAL RETURN FIGURES INCLUDE THE REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS.
SOME OF THE FUND'S FEES HAVE BEEN WAIVED OR EXPENSES REIMBURSED; OTHERWISE
TOTAL RETURN WOULD HAVE BEEN LOWER.
6
Ironwood Isabelle Small Company Stock Fund
Portfolio Of Investments
June 30, 2007 - (Unaudited)
MARKET
SHARES SECURITY VALUE
------ -------- ------
COMMON STOCK - 99.88%
CONSUMER DISCRETIONARY & SERVICES - 12.83%
65,300 4Kids Entertainment, Inc.+ $ 979,500
1,522,900 Danka Business Systems plc, ADR+ 1,675,190
50,000 Hooker Furniture Corp. 1,122,000
379,700 Westaff, Inc.+ 1,647,898
----------
5,424,588
----------
CONSUMER STAPLES - 3.16%
70,400 Chiquita Brands International, Inc. 1,334,784
----------
OTHER ENERGY - 7.91%
90,000 CE Franklin, Ltd.+ 1,048,500
171,300 International Coal Group, Inc.+ 1,024,374
80,200 Petrohawk Energy Corp.+ 1,271,972
----------
3,344,846
----------
FINANCIAL SERVICES - 8.82%
12,000 Arch Capital Group, Ltd.+ 870,480
28,600 Citizens First Bancorp, Inc. 623,480
73,300 Eastern Insurance Holdings, Inc. 1,164,737
21,900 Hanover Insurance Group, Inc. 1,068,501
----------
3,727,198
----------
HEALTH CARE - 12.96%
15,000 Analogic Corp. 1,102,650
193,601 ARIAD Pharmaceuticals, Inc.+ 1,062,870
290,500 Durect Corp.+ 1,118,425
599,300 Gene Logic, Inc.+ 827,034
472,600 Novavax, Inc.+ 1,370,540
----------
5,481,519
----------
MATERIALS & PROCESSING - 29.10%
35,100 AM Castle & Co. 1,260,441
28,300 Ampco-Pittsburgh Corp. 1,134,547
105,300 Chemtura Corp. 1,169,883
131,000 ICO, Inc.+ 1,384,670
155,850 Industrial Enterprises of America, Inc.+ 787,042
128,400 Material Sciences Corp.+ 1,513,836
74,400 Novagold Resources, Inc.+ 1,118,232
58,100 Olin Corp. 1,220,100
The accompanying notes are an integral part of the financial statements.
7
Ironwood Isabelle Small Company Stock Fund
Portfolio Of Investments
June 30, 2007 - (Unaudited), (Continued)
MARKET
SHARES SECURITY VALUE
------ -------- ------
MATERIALS & PROCESSING (CONTINUED)
232,500 Omnova Solutions, Inc.+ $ 1,406,625
181,800 PolyOne Corp.+ 1,307,142
-----------
12,302,518
-----------
PRODUCER DURABLES - 12.85%
65,650 Allied Defense Group, Inc.+ 504,849
196,200 Cherokee International Corp.+ 969,228
282,900 Magne tek, Inc.+ 1,456,935
366,600 Proliance International, Inc.+ 1,136,460
78,100 Williams Controls, Inc.+ 1,365,969
-----------
5,433,441
-----------
TECHNOLOGY - 10.30%
233,500 ActivIdentity Corp.+ 1,074,100
419,800 InFocus Corp.+ 936,154
232,300 Iomega Corp.+ 1,080,195
608,844 SoftBrands, Inc.+ 1,266,395
-----------
4,356,844
-----------
UTILITIES - 1.95%
202,000 Aquila, Inc.+ 826,180
-----------
TOTAL COMMON STOCK (COST $32,206,621) 42,231,918
-----------
SHORT-TERM INVESTMENT - 0.30%
MONEY MARKET FUND - 0.30%
127,819 Fifth Third Institutional
Money Market, 5.21% (Cost $127,819) 127,819
-----------
TOTAL INVESTMENTS (COST $32,334,440)* - 100.18% $42,359,737
OTHER ASSETS NET OF LIABILITIES - (0.18)% (75,396)
-----------
NET ASSETS - 100.00% $42,284,341
===========
- --------
+ Non-income producing security.
ADR American Depositary Receipt.
plc Public Limited Company.
The accompanying notes are an integral part of the financial statements.
8
Ironwood Isabelle Small Company Stock Fund
Portfolio Of Investments
June 30, 2007 - (Unaudited), (Continued)
* Cost for Federal income tax purposes is substantially the same as for
financial statement purposes and net unrealized appreciation (depreciation)
consists of:
Gross Unrealized Appreciation $11,459,760
Gross Unrealized Depreciation (1,434,463)
-----------
Net Unrealized Appreciation (Depreciation) $10,025,297
===========
MAKE INTO A PIE CHART AS IN PREVIOUS REPORTS
PORTFOLIO HOLDINGS
% of Total Investments
Health Care 12.9%
Consumer Discretionary & Services 12.8%
Producer Durables 12.8%
Materials & Processing 29.1%
Technology 10.3%
Financial Services 8.8%
Other Energy 7.9%
Consumer Staples 3.1%
Utilities 2.0%
Money Market Fund 0.3%
-----
100.0%
The accompanying notes are an integral part of the financial statements.
9
Ironwood Isabelle Small Company Stock Fund
Statement Of Assets And Liabilities
June 30, 2007 - (Unaudited)
ASSETS:
Investments in securities at market value
(cost $32,334,440) $42,359,737
Cash 12
Receivable for securities sold 257
Receivable for Fund shares sold 8,474
Interest and dividends receivable 6,492
Prepaid expenses 25,982
-----------
TOTAL ASSETS 42,400,954
-----------
LIABILITIES:
Due to custodian 699
Payable for Fund shares redeemed 20,000
Payable to adviser 18,256
Payable for trustees' fees and expenses 3,800
Other accrued expenses 73,858
-----------
TOTAL LIABILITIES 116,613
-----------
NET ASSETS $42,284,341
===========
NET ASSETS CONSIST OF:
Paid-in capital 25,078,380
Accumulated net investment income (loss) (329,251)
Accumulated net realized gain (loss) on investments 7,509,915
Net unrealized appreciation (depreciation) of investments 10,025,297
-----------
NET ASSETS $42,284,341
===========
INVESTMENT CLASS SHARES:
Net Assets (unlimited shares of $0.001 par beneficial
interest authorized; 2,628,498 shares outstanding) $38,508,263
-----------
Net asset value, offering and redemption price
per Investment Class Share $ 14.65
-----------
INSTITUTIONAL CLASS SHARES:
Net Assets (unlimited shares of $0.001 par beneficial
interest authorized; 246,745 shares outstanding) $ 3,776,078
-----------
Net asset value, offering and redemption price
per Institutional Class Share $ 15.30
-----------
The accompanying notes are an integral part of the financial statements.
10
Ironwood Isabelle Small Company Stock Fund
Statement Of Operations
SIX MONTHS
ENDED
JUNE 30, 2007
(UNAUDITED)
-------------
INVESTMENT INCOME
Dividends $ 96,605
-----------
EXPENSES
Investment advisory fees 223,478
Administration fees 20,113
Transfer agent fees
Investment Class Shares 43,049
Institutional Class Shares 8,167
Distribution fees
Investment Class Shares 51,336
Accounting fees 28,098
Custodian fees 5,144
Professional fees 74,299
Registration fees 18,384
Trustees' fees and expenses 14,645
Compliance services fees 16,419
Miscellaneous fees 27,667
-----------
TOTAL EXPENSES 530,799
Fees waived and expenses reimbursed (104,943)
-----------
NET EXPENSES 425,856
-----------
NET INVESTMENT INCOME (LOSS) (329,251)
-----------
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS
Net realized gain (loss) on investments 8,288,201
Net change in unrealized appreciation
(depreciation) of investments (4,171,387)
-----------
Net realized and unrealized gain (loss) on investments 4,116,814
-----------
INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 3,787,563
===========
The accompanying notes are an integral part of the financial statements.
11
Ironwood Isabelle Small Company Stock Fund
Statements Of Changes In Net Assets
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
---------------- -----------------
OPERATIONS
Net investment income (loss) $ (329,251) $ (909,268)
Net realized gain (loss) on
investments 8,288,201 9,758,029
Net change in unrealized appreciation
(depreciation) of investments (4,171,387) (1,733,844)
------------ ------------
Increase (decrease) in net assets
resulting from operations 3,787,563 7,114,917
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net realized gains:
Investment Class -- (11,290,626)
Institutional Class -- (848,162)
------------ ------------
Total distributions to shareholders -- (12,138,788)
------------ ------------
CAPITAL SHARE TRANSACTIONS
Proceeds from shares subscribed:
Investment Class 3,577,228 76,340,325
Institutional Class 53,389 1,251,221
Reinvestment of distributions:
Investment Class -- 11,021,168
Institutional Class -- 754,704
Redemption of shares:
Investment Class (14,724,886) (85,552,148)
Institutional Class (163,225) (10,783,631)
------------ ------------
Increase (Decrease) in net assets
from capital share transactions (a) (11,257,494) (6,968,361)
------------ ------------
TOTAL INCREASE (DECREASE)
IN NET ASSETS (7,469,931) (11,992,232)
------------ ------------
NET ASSETS
Beginning of period 49,754,272 61,746,504
------------ ------------
End of period (including accumulated
net investment loss of $329,251,
and $0, respectively) $ 42,284,341 $ 49,754,272
============ ============
The accompanying notes are an integral part of the financial statements.
12
Ironwood Isabelle Small Company Stock Fund
Statements Of Changes In Net Assets - (Continued)
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
---------------- -----------------
NET ASSETS (CONTINUED)
(a) Transactions in capital stock
were:
Investment Class
Shares sold 261,119 4,685,871
Reinvestment of distributions -- 835,570
Shares redeemed (1,066,354) (5,606,838)
---------- ----------
Increase (Decrease) in shares
outstanding (805,235) (85,397)
========== ==========
Institutional Class
Shares sold 3,766 75,280
Reinvestment of distributions -- 54,848
Shares redeemed (11,247) (664,149)
---------- ----------
Increase (Decrease) in shares
outstanding (7,481) (534,021)
========== ==========
The accompanying notes are an integral part of the financial statements.
13
Ironwood Isabelle Small Company Stock Fund
Financial Highlights
The table below sets forth financial data for one share of capital stock
outstanding throughout each year or period indicated.
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
INVESTMENT CLASS (UNAUDITED) DECEMBER 31, 2006
- ---------------- ---------------- -----------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 13.45 $ 14.26
------- -------
Increase (decrease) from investment
operations:
Net investment loss (0.10)(a) (0.21)(a)
Net realized and unrealized gains
(losses) on investments 1.30(a) 3.51(a)
------- -------
NET INCREASE (DECREASE)
FROM INVESTMENT OPERATIONS 1.20 3.30
------- -------
Less distributions from net
realized gains -- (4.11)
------- -------
NET ASSET VALUE, END OF PERIOD $ 14.65 $ 13.45
======= =======
TOTAL RETURN (B)(C) 8.92% 23.68%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000s) $38,508 $46,187
Ratio of expenses to average net
assets:
Before waivers and/or
reimbursements 2.36% 2.13%
After waivers and/or
reimbursements 1.95% 1.90%
Ratio of net investment income
(loss) to average net assets:
(d)
Before waivers and/or
reimbursements (1.90)% (1.59)%
After waivers and/or
reimbursements (1.49)% (1.35)%
Portfolio turnover rate 21.72% 131.30%
- --------
(a) Calculated based on average shares outstanding during the period.
(b) Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions and the complete redemption of
the investment at the end of the period. Total return reflects performance
based on net operating expenses. During any period in which fees were
waived or expenses reimbursed, total return would have been lower if
expenses had not been reduced.
(c) Not annualized for periods less than one year.
(d) Annualized for periods less than one year.
The accompanying notes are an integral part of the financial statements.
14
Ironwood Isabelle Small Company Stock Fund
Financial Highlights - (Continued)
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, 2005 DECEMBER 31, 2004 DECEMBER 31, 2003 DECEMBER 31, 2002
----------------- ----------------- ----------------- -----------------
$ 16.31 $ 13.80 $ 9.76 $ 11.82
-------- -------- -------- --------
(0.23)(a) (0.19)(a) (0.13)(a) (0.14)
0.91(a) 2.70(a) 4.17(a) (1.92)
-------- -------- -------- --------
0.68 2.51 4.04 (2.06)
-------- -------- -------- --------
(2.73) -- -- --
-------- -------- -------- --------
$ 14.26 $ 16.31 $ 13.80 $ 9.76
======== ======== ======== ========
4.81% 18.12% 41.39% (17.43)%
$ 50,171 $ 70,825 $ 67,983 $ 64,552
2.04% 1.89% 1.94% 1.80%
1.95% 1.86% 1.88% 1.71%
(1.56)% (1.38)% (1.32)% (1.17)%
(1.47)% (1.35)% (1.26)% (1.08)%
65.68% 90.58% 51.70% 50.41%
The accompanying notes are an integral part of the financial statements.
15
Ironwood Isabelle Small Company Stock Fund
Financial Highlights
The table below sets forth financial data for one share of capital stock
outstanding throughout each year or period indicated.
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
INSTITUTIONAL CLASS (UNAUDITED) DECEMBER 31, 2006
- ------------------- ---------------- -----------------
NET ASSET VALUE, BEGINNING OF PERIOD $14.03 $ 14.68
------ -------
Increase (decrease) from investment
operations:
Net investment loss (0.09)(a) (0.18)(a)
Net realized and unrealized gains
(losses) on investments 1.36(a) 3.64(a)
------ -------
NET INCREASE (DECREASE)
FROM INVESTMENT OPERATIONS 1.27 3.46
------ -------
Less distributions from net
realized gains -- (4.11)
------ -------
NET ASSET VALUE, END OF PERIOD $15.30 $ 14.03
====== =======
TOTAL RETURN (B)(C) 9.05% 24.09%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000s) $3,776 $ 3,568
Ratio of expenses to average net
assets:
Before waivers and/or
reimbursements 2.59% 2.27%
After waivers and/or
reimbursements 1.70% 1.69%
Ratio of net investment income
(loss) to average net assets:
(d)
Before waivers and/or
reimbursements (2.13)% (1.73)%
After waivers and/or
reimbursements (1.24)% (1.15)%
Portfolio turnover rate 21.72% 131.30%
- --------
(a) Calculated based on average shares outstanding during the period.
(b) Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions and the complete redemption of
the investment at the end of the period. Total return reflects performance
based on net operating expenses. During any period in which fees were
waived or expenses reimbursed, total return would have been lower if
expenses had not been reduced.
(c) Not annualized for periods less than one year.
(d) Annualized for periods less than one year.
The accompanying notes are an integral part of the financial statements.
16
Ironwood Isabelle Small Company Stock Fund
Financial Highlights - (Continued)
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, 2005 DECEMBER 31, 2004 DECEMBER 31, 2003 DECEMBER 31, 2002
----------------- ----------------- ----------------- -----------------
$ 16.63 $ 14.03 $ 9.89 $ 11.95
-------- -------- -------- --------
(0.20)(a) (0.16)(a) (0.10)(a) (0.11)
0.98(a) 2.76(a) 4.24(a) (1.95)
-------- -------- -------- --------
0.78 2.60 4.14 (2.06)
-------- -------- -------- --------
(2.73) -- -- --
-------- -------- -------- --------
$ 14.68 $ 16.63 $ 14.03 $ 9.89
======== ======== ======== ========
5.31% 18.46% 41.86% (17.24)%
$ 11,576 $ 15,193 $ 18,253 $ 20,920
1.81% 1.63% 1.61% 1.49%
1.70% 1.61% 1.55% 1.44%
(1.35)% (1.12)% (0.98)% (0.86)%
(1.24)% (1.10)% (0.93)% (0.82)%
65.68% 90.58% 51.70% 50.41%
The accompanying notes are an integral part of the financial statements.
17
Ironwood Isabelle Small Company Stock Fund
Notes to Financial Statements
June 30, 2007 - (Unaudited)
NOTE 1 - ORGANIZATION
Ironwood Isabelle Small Company Stock Fund (formerly known as ICM/Isabelle
Small Cap Value Fund) (the "Fund") is a series of Ironwood Series Trust
(formerly known as ICM Series Trust) (the "Trust"), which was organized as a
Massachusetts business trust pursuant to a Declaration of Trust dated
November 18, 1997. The Trust is registered under the Investment Company Act of
1940, as amended (the "1940 Act"). The Fund offers two classes of shares,
Investment Shares and Institutional Shares (collectively, the "Shares"), each
of which has equal rights as to class and voting privileges. The Investment
Shares have exclusive voting rights with respect to its distribution plan
pursuant to Rule 12b-1 under the 1940 Act ("12b-1 Plan") and are subject to
12b-1 Plan expenses. The Fund commenced operations on March 9, 1998 (March 27,
1998 for the Institutional Shares). The investment objective of the Fund is to
seek capital appreciation by investing its assets primarily in relatively
undervalued common stocks of domestic small companies.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with accounting principles generally accepted in the
United States of America ("generally accepted accounting principles"). The
preparation of financial statements in conformity with generally accepted
accounting principles requires management makes estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements, as well as the reported amounts for revenues and expenses
during the reporting period. Actual results could differ from those estimates.
SECURITY VALUATION. Exchange traded securities and over-the-counter
securities listed on the NASDAQ National Market System for which market
quotations are readily available are valued using the last reported sales
price or the NASDAQ Official Closing Price ("NOCP"), provided by independent
pricing services as of the close of
18
Ironwood Isabelle Small Company Stock Fund
Notes to Financial Statements
June 30, 2007 - (Unaudited), (Continued)
trading on the New York Stock Exchange on each Fund business day. In the
absence of a sale or NOCP, such securities are valued at the mean of the
last bid and asked price. Non-exchange traded securities for which
quotations are available are generally valued at the mean between the
current bid and asked prices. Money market instruments that mature in sixty
days or less may be valued at amortized cost.
The Fund values securities at fair value pursuant to procedures adopted by
the Trust's Board of Trustees if (1) market quotations are insufficient or
not readily available; or (2) the Adviser believes that the prices or values
available are unreliable. Fair valuation is based on subjective factors and
as a result, the fair value price of an asset may differ from the asset's
market price and may not be the price at which the asset may be sold. Fair
valuation could result in a different net asset value ("NAV") than a NAV
determined by using market quotes.
INVESTMENT INCOME AND SECURITIES TRANSACTIONS. Securities transactions are
accounted for on the date the securities are purchased or sold (trade date).
Realized gains and losses are based on the identified cost basis for both
financial statement and federal income tax purposes. Dividend income is
accrued and recorded on the ex-dividend date. Interest income and expenses
are accrued daily.
FEDERAL INCOME TAXES. The Fund intends to qualify as a regulated investment
company under Subchapter M of the Internal Revenue Code and distribute all
of its net investment income and capital gains to shareholders. Accordingly
no provision for Federal income tax is required.
For the fiscal year ended December 31, 2006, the Fund reclassified $909,268
to increase net investment income (loss), $398,091 to increase accumulated
net realized loss on investments and $511,177 to decrease paid-in-capital.
The reclassification has no impact on the net asset value of the Fund and is
primarily due to net operating losses.
19
Ironwood Isabelle Small Company Stock Fund
Notes to Financial Statements
June 30, 2007 - (Unaudited), (Continued)
As of December 31, 2006, distributable earnings on a tax basis were as
follows:
Unrealized Appreciation (Depreciation) $ 13,418,398
INCOME AND EXPENSES. Expenses directly attributable to a particular class
are charged directly to such class. In calculating net asset value per share
of each class, investment income, realized and unrealized gains and losses
and expenses, other than class specific expenses, are allocated daily to
each class of shares based on the proportion of net assets of each class at
the beginning of that day.
REPURCHASE AGREEMENTS. The Fund may invest in repurchase agreements. The
Fund will require the financial institution with which the Fund enters into
a repurchase agreement to maintain collateral at all times with a value
equal to the amount the Fund paid for the securities. In the event of
default, the Fund may have difficulties with the disposition of any
securities held as collateral.
REDEMPTION FEES. A shareholder who redeems or exchanges shares within 30
days of purchase will incur a redemption fee of 2.00% of the current net
asset value of shares redeemed or exchanged, subject to certain limitations.
The fee is charged for the benefit of the remaining shareholders and will be
paid to the Fund to help offset transaction costs. The fee is accounted for
as an addition to paid-in capital. The Fund reserves the right to modify the
terms of or terminate the fee at any time. There are limited exceptions to
the imposition of the redemption fee.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions to shareholders from net
investment income and net capital gain if any, are declared and paid at
least annually. The amount of the distribution are determines in accordance
with income tax regulations which may differ from generally accepted
accounting principles. The differences are due primarily to
20
Ironwood Isabelle Small Company Stock Fund
Notes to Financial Statements
June 30, 2007 - (Unaudited), (Continued)
differing treatments of income and gain on various investment securities
held by the Fund timing differences and differing characterizations of
distributions made by the Fund.
NEW ACCOUNTING PRONOUNCEMENTS. In June 2006, Financial Accounting Standards
Board issued Financial Interpretation No. 48, Accounting for Uncertainty in
Income Taxes (the "Interpretation") which is effective for fiscal years
beginning after December 15, 2006 and is to be applied to all open tax years
no later than June 30, 2007. This Interpretation prescribes a minimum
threshold for financial statement recognition of the benefit of a tax
position taken or expected to be taken in a tax return, and requires certain
expanded disclosures. Fund management has determined that the Fund did not
have any unrecognized tax benefits as a result of tax positions taken in the
current or prior reporting periods that would require reporting under FIN 48.
In September 2006, the FASB issued Statement of Financial Accounting
Standards No. 157 "Fair Value Measurements" ("SFAS 157") which is effective
for fiscal years beginning after November 15, 2007, and interim periods
within those fiscal years. SFAS 157 defines fair value, establishes a
framework for measuring fair value in generally accepted accounting
principles, and expands disclosures about fair value measurements.
Management has recently begun to evaluate the application of SFAS 157, and
has not at this time determined the impact, if any, resulting from its
adoption on the Fund's financial statements.
NOTE 3 - PURCHASES AND SALES OF SECURITIES
Purchases and sales of securities, other than short-term investments,
aggregated $9,723,113 and $21,907,937, respectively, for the six months ended
June 30, 2007.
21
Ironwood Isabelle Small Company Stock Fund
Notes to Financial Statements
June 30, 2007 - (Unaudited), (Continued)
NOTE 4 - ADVISORY FEES, SERVICING FEES, AND OTHER TRANSACTIONS WITH RELATED
PARTIES
INVESTMENT ADVISER - Ironwood Investment Management, LLC (formerly known as
Ironwood Capital Management, LLC) ("Ironwood") serves as the investment adviser
for the Fund pursuant to an investment advisory agreement (the "Agreement").
Under the terms of the Agreement, Ironwood receives an investment advisory fee
from the Fund, accrued daily and paid monthly, at an annual rate of 1.00% of
the average daily net assets of the Fund. Pursuant to the terms of the
Agreement, Ironwood is obligated for as long as the Agreement remains in
effect, to limit total annual Fund operating expenses to 1.95% of the average
daily net assets annually for the Investment Shares and 1.70% of the average
daily net assets annually for the Institutional Shares, and to waive such fees
and reimburse expenses to the extent that they exceed these amounts. For the
six months ended June 30, 2007, advisory fees of $99,517 were waived by
Ironwood.
DISTRIBUTOR - Foreside Fund Services, LLC is the Fund's distributor (the
"Distributor). The Distributor is not affiliated with the Adviser or Citigroup
Fund Services, LLC, ("Citigroup"), or its affiliated companies.
The Fund has adopted a 12b-1 Plan with the respect to the Investment Shares in
accordance with Rule 12-1 of the 1940 Act. Under the 12b-1 Plan, the Fund
compensates the Distributor, at a rate of up to 0.25% of average daily net
assets of the Investment Shares for distribution expenses borne or paid to
others, by the Distributor.
OTHER SERVICE PROVIDERS - Citigroup provides administration, portfolio
accounting and transfer agency services to the Fund. Certain employees of
Citigroup are also Officers of the Trust.
Foreside Compliance Services, LLC ("FCS") an affiliate of the Distributor,
provides a Principal Financial Officer (effective June 12, 2007) and a Chief
Compliance Officer as well as certain additional compliance support functions
to the Trust. Prior to February 22, 2007,
22
Ironwood Isabelle Small Company Stock Fund
Notes to Financial Statements
June 30, 2007 - (Unaudited), (Continued)
compliance services were provided by the Distributor. FCS has no role in
determining the investment policies or which securities are to be purchased or
sold by the Fund. Certain officers or employees of FCS are also officers of the
Trust.
In addition, the Fund has entered into separate service and operating
agreements with Charles Schwab & Co., Inc. ("Schwab") and Fidelity Brokerage
Services Inc./National Financial Services Corp. ("NFSC"), whereby Schwab and
NFSC make shares of the Fund available to their clients in exchange for a
servicing fee. These fees are included as part of the Transfer Agency fees on
the statement of operations. For the six-month period ended June 30, 2007, Bank
of New York Securities ("BONY Securities") reimbursed certain fund accounting
expenses in the amount of $5,394 due to the Fund's direction of portfolio
transactions to BONY Securities during the period.
The custodian, Fifth Third Bank (the "Custodian"), has agreed to compensate the
Fund and decrease custody fees for interest on any cash balances left
uninvested. For the six months ended June 30, 2007, the Fund was reimbursed
expenses of $32 by the Custodian.
No Trustee, officer or employee of Ironwood, FCS or Citigroup, or any affiliate
thereof, receives any compensation from the Trust for serving as a Trustee or
officer of the Trust. Disinterested trustees received $14,608 in compensation
from the Trust during the six months ended June 30, 2007.
23
Ironwood Isabelle Small Company Stock Fund
Notes to Financial Statements
June 30, 2007 - (Unaudited), (Continued)
NOTE 5 - LINE OF CREDIT
The Fund has entered into a line of credit agreement with the Custodian to be
used for temporary purposes, primarily for financing redemptions. The agreement
provides that the Fund may borrow up to $5,000,000. The aggregate outstanding
principal amount of all loans may not exceed $5,000,000. Interest is charged to
the Fund, based on its borrowings, at a rate equal to the rate of interest on
overnight facilities which the Custodian is offering to other borrowers and
potential borrowers of comparable financial condition on the business day that
a loan is made pursuant to the agreement.
During the six months ended June 30, 2007, the Fund was charged $722 from
borrowings under the line of credit. As of June 30, 2007, the Fund had no loans
outstanding under the line of credit.
NOTE 6 - OTHER INFORMATION
On June 30, 2007, two shareholders held approximately 48% of the outstanding
shares of the Fund's Investment Shares. These shareholders are omnibus
accounts, which are held on behalf of several individual shareholders. As of
the same date, five shareholders held approximately 79% of the outstanding
shares of the Fund's Institutional Shares. One of these shareholders is an
omnibus account, which is held on behalf of several individual shareholders.
24
Ironwood Isabelle Small Company Stock Fund
Additional Information
June 30, 2007 - (Unaudited)
PROXY VOTING INFORMATION
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to securities held in the Fund's portfolio is
available, without charge and upon request, by calling (800) 472-6114 and on
the SEC's website at www.sec.gov. The Fund's proxy voting record for the
twelve-month period ended June 30, is available, without charge and upon
request, by calling (800) 472-6114, on the Fund's website www.ironwoodfunds.com
and on the SEC's website at www.sec.gov.
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULES
The Fund files its complete schedule of portfolio holdings with the SEC for the
first and third quarters of each fiscal year on Form N-Q. The Fund's Forms N-Q
are available, without charge and upon request, on the SEC's website at
www.sec.gov. or may be reviewed and copied at the SEC's Public Reference Room
in Washington, D.C. Information on the operation of the Public Reference Room
may be obtained by calling (800) SEC-0330.
SHAREHOLDER EXPENSES
As a shareholder of the Fund you incur two types of costs: (1) transactional
costs (i.e. redemption fees) and (2) ongoing costs, including management fees,
distribution fees with respect to Investment Shares and other Fund expenses.
This example is intended to help you understand these ongoing costs (in
dollars) of investing in the Fund and to compare these costs with the ongoing
costs of investing in other mutual funds.
The following example is based on $1,000 invested at the beginning of the year
and held for the entire period from January 1, 2007 through June 30, 2007.
ACTUAL EXPENSES - The first line of the table below provides information about
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
25
Ironwood Isabelle Small Company Stock Fund
Additional Information
December 31, 2006 - (Unaudited), (Continued)
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 "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
provides information about hypothetical account values and hypothetical
expenses based on the Fund's actual expense ratio and an assumed rate of return
of 5% per year 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 cost of investing in the Fund and other
funds. To do so, compare this 5% hypothetical example with the 5% hypothetical
examples that appear in the shareholder reports of other funds.
Please note that expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs. Therefore, the
second line of the table is useful in comparing ongoing costs only, and will
not help you determine the relative total costs of owning different funds. In
addition, if these transactional costs had been included, your costs would have
been higher.
BEGINNING ENDING EXPENSES
ACCOUNT VALUE ACCOUNT VALUE PAID DURING
JANUARY 1, 2007 JUNE 30, 2007 PERIOD*
--------------- ------------- -----------
INVESTMENT SHARES
Actual Return $1,000.00 $1,089.21 $10.10
Hypothetical Return $1,000.00 $1,015.12 $ 9.74
INSTITUTIONAL SHARES
Actual Return $1,000.00 $1,090.52 $ 8.81
Hypothetical Return $1,000.00 $1,016.36 $ 8.50
- --------
* EXPENSES ARE EQUAL TO THE FUND'S ANNUALIZED EXPENSE RATIOS OF 1.95% AND
1.70% FOR INVESTMENT SHARES AND INSTITUTIONAL SHARES, RESPECTIVELY,
MULTIPLIED BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE
NUMBER OF DAYS IN MOST RECENT FISCAL HALF-YEAR/365 (TO REFLECT THE HALF-YEAR
PERIOD).
26
Ironwood Investment Management, LLC
And Ironwood Funds
THE IRONWOOD TREE
is a small, hardy tree, which yields a very useful and solid wood. Patiently,
these trees remain under the forest canopy until taller neighbors fall.
Once given the opportunity, the Ironwood grows quickly
to reach its full potential. We believe this imagery is appropriate
for our firm as well as our investment style.
IRONWOOD INVESTMENT MANAGEMENT, LLC,
the investment manager of the Ironwood Isabelle Small Company
Stock Fund, is an investment management firm specializing
in investing in small company stocks.
Ironwood Series Trust
Two Portland Square
Portland, ME 04101
1-800-472-6114
DISTRIBUTOR
Foreside Fund Services, LLC
Two Portland Square, 1st Floor
Portland, ME 04101
www.foresides.com
- --------------------------------------------------------------------------------
This report is submitted for the general information of the shareholders of the
Fund. It is not authorized for distribution to prospective investors unless
preceded or accompanied by an effective prospectus, which includes information
regarding the Fund's risks, objectives, fees and expenses, experience of its
management, and other information.
There are risks associated with investing in funds of this type that invest in
stocks of small-sized companies, which tend to be more volatile and less liquid
than stocks of larger companies. Past Fund performance is not indicative of
future results.
FOR ACCOUNT INFORMATION, CURRENT PERFORMANCE AND PRICES, CALL 1-800-472-6114
BETWEEN THE HOURS OF 9:00 A.M. AND 5:00 P.M. (EASTERN TIME), MONDAY THROUGH
FRIDAY.
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.
Included as part of report to stockholders under Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 11. CONTROLS AND PROCEDURES
(a)The registrant's President and Treasurer have concluded that the
registrant's disclosure controls and procedures (as defined in rule
30a-3(c) under the Investment Company Act of 1940 (the "Act")) are
effective, based on their evaluation of these disclosure controls and
procedures as of a date within 90 days of the filing date of this report.
(b)There were no changes in the registrant's internal control over
financial reporting (as defined in rule 30a-3(d) under the Act) 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 pursuant to Rule 30a-2(a) of the Investment Company Act
of 1940 as amended, and Section 302 of the Sarbanes-Oxley Act of 2002 (Exhibit
filed herewith).
(a)(3) Not applicable.
(b) Certifications pursuant to Rule 30a-2(b) of the Investment Company Act of
1940, as amended, and Section 906 of the Sarbanes-Oxley Act of 2002 (Exhibit
filed herewith).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant Ironwood Series Trust
By /s/ Warren J. Isabeile
--------------------------------
Warren J. Isabelle, President
Date 8/30/2007
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 /s/ Warren J. Isabelle
--------------------------------
Warren J. Isabelle, President
Date 8/30/2007
By /s/ Trudance L.C. Bakke
--------------------------------
Trudance L.C. Bakke, Treasurer
Date 8/28/2007