N-CSRS 1 fp0068063_ncsrs.htm
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM N-CSR

 

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

 

Investment Company Act file number 811-07148  

 

Schwartz Investment Trust
(Exact name of registrant as specified in charter)

 

801 W. Ann Arbor Trail, Suite 244                 Plymouth, Michigan 48170
(Address of principal executive offices) (Zip code)

 

George P. Schwartz

 

Schwartz Investment Counsel, Inc. 801 W. Ann Arbor Trail, Plymouth, MI 48170
(Name and address of agent for service)

 

Registrant's telephone number, including area code: (734) 455-7777  

 

Date of fiscal year end: December 31  
     
Date of reporting period: June 30, 2021  

 

Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

 

A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

 

 

 

Item 1.Reports to Stockholders.

 

(a)

 

 

 

 

Schwartz Value Focused Fund
2021 6-Month Letter to Shareholders

 

Shareholder Services

c/o Ultimus Fund Solutions, LLC

P.O. Box 46707

Cincinnati, OH 45246

(888) 726-0753

 

Investment Adviser

Schwartz Investment Counsel, Inc.
801 W. Ann Arbor Trail

Suite 244

Plymouth, MI 48170

 

Dear Fellow Shareholders,

 

The Schwartz Value Focused Fund (the “Fund”) had a good start to the year with a total return of 37.79% for the 6-month period ended June 30, 2021 compared to 15.61% for the S&P 1500 Index. For the 6-month period, the Fund was the #1 performing equity mutual fund in Morningstar’s Mid-Cap Blend category. The Fund also performed well for the 1-year period ended June 30, 2021 with a total return of 65.67% compared to 42.12% for the S&P 1500 Index. For the 1-year period, the Fund ranked in the top 7th percentile out of 389 mid-cap blend funds, according to Morningstar.1 The Fund’s notable performance is also being recognized by the investment community, as the Fund was listed in the Wall Street Journal’s July 6, 2021 Category Kings Rankings for 1-year performance. For that period, the Fund ranked #2 out of 393 midcap growth funds as tracked by Lipper.2

 

For the first 6 months of 2021, the Fund’s two best performing stocks were Avid Bioservices, Inc. (“Avid”) +146% and Texas Pacific Land Corporation (“TPL”) +121%. Avid is a rapidly growing, commercial biologic contract development and manufacturing company focused on the development and manufacture of biopharmaceuticals. Since the Fund’s initial purchase in 2018, the stock price is up more than 10-fold. For its most recent fiscal year, the company recorded annual revenue growth of 61% while gross margins significantly improved from 7% to more than 30%. Revenue for the current year is expected to grow another 20-25%.

 

TPL’s weighting in the portfolio (31.5% of Fund net assets) is much larger than Avid’s (1.4%), so it had a much greater positive impact on performance. Like Avid, TPL has appreciated nearly 10-fold since the Fund’s initial purchase in 2016. In our view, shares of TPL remain compelling. The company operates a remarkably profitable royalty business model and owns 880,000 surface acres in West Texas, in the oil and natural gas-rich Permian Basin. With low expenses and minimal capital expenditures, the company produces sizable free cash flow, which it returns to shareholders via dividends (increased for 17 consecutive years) and share repurchases. Additionally, the balance sheet has zero debt with $311 million in cash.

 

The Fund’s five best performing securities in the first half of 2021 were:

 

Company

Industry

YTD Return

Avid Bioservices, Inc.

Biopharmaceuticals

146.88%

Texas Pacific Land Corporation

Real estate

121.06%

Devon Energy Corporation

Oil/gas exploration & production

89.42%

Valvoline, Inc.

Oil refining & marketing

41.50%

Pioneer Natural Resources

Oil/gas exploration & production

40.07%

 

1

 

 

 

The Fund’s five worst performing securities in the first half of 2021 were:

 

Company

Industry

YTD Return

Madison Square Garden Ent.

Entertainment

-20.06%

Pan American Silver Corporation

Metals & mining

-16.83%

Barrick Gold Corp.

Metals & mining

-7.84%

Madison Square Garden Sports

Entertainment

-6.26%

Brown-Forman Corp.

Beverages

-5.21%

 

During the past six months, no stocks were eliminated from the portfolio. New positions were established in four companies that meet our criteria of owning shares of high-quality businesses, in strong financial condition, that are selling at discount to our estimate of intrinsic value: Franco Nevada Corp. (basic materials), Intercontinental Exchange, Inc. (financial data & stock exchanges), Schlumberger Limited (oil & gas equipment & service), and Vontier Corporation (mobility technology & auto repair solutions).

 

The Fund’s positive recent performance has not led us to rest on our laurels. We remain committed to working tirelessly to find superior investments that meet our stringent, value-oriented criteria. Thank you for being a shareholder in the Schwartz Value Focused Fund.

 

Timothy S. Schwartz, CFA

George P. Schwartz, CFA

Lead Portfolio Manager

Co-Portfolio Manager

 

1

Ranking based on total return for 1-year period ending June 30, 2021. The fund received a Morningstar rank of 14 out of 357 funds for the 3-year period, 16 out of 290 for the 5-year period and 92 out of 202 funds for the 10-year period. Past performance is no guarantee of future results. The highest (or most favorable) percentile rank is one and the lowest (or least favorable) percentile rank is 100.

2

Lipper, Inc., a mutual fund rating service, compiles performance data used to derive their own data. Lipper rankings are based on total return. As of June 30, 2021, Lipper placed Schwartz Value Focused Fund in the #2 position within their Midcap Growth category, which on that date included 393 funds.

 

2

 

 

 

SCHWARTZ VALUE FOCUSED FUND
TEN LARGEST HOLDINGS
June 30, 2021 (Unaudited)

 

 

 

Shares

 

 

Security Description

 

Market
Value

   

% of
Net Assets

 
    5,500    

Texas Pacific Land Corporation

  $ 8,798,570       31.5%  
    75,000    

Barrick Gold Corporation

    1,551,000       5.5%  
    11,550    

Chevron Corporation

    1,209,747       4.3%  
    7,240    

Pioneer Natural Resources Company

    1,176,645       4.2%  
    7,690    

Franco-Nevada Corporation

    1,115,588       4.0%  
    4,650    

CME Group, Inc.

    988,962       3.5%  
    30,000    

Valvoline, Inc.

    973,800       3.5%  
    1,500    

Graham Holdings Company - Class B

    950,850       3.4%  
    30,000    

Devon Energy Corporation

    875,700       3.2%  
    30,000    

Pan American Silver Corporation

    857,100       3.1%  

 

ASSET ALLOCATION (Unaudited)

 

 

 

% of
Net Assets

COMMON STOCKS

 

Sector

 

Communications

0.3%

Consumer Discretionary

8.2%

Consumer Staples

2.5%

Energy

13.9%

Financials

10.7%

Health Care

2.2%

Industrials

7.6%

Materials

16.1%

Real Estate

31.5%

Technology

5.2%

Money Market Funds, Liabilities in Excess of Other Assets

1.8%

 

100.0%

 

3

 

 

 

SCHWARTZ VALUE FOCUSED FUND
SCHEDULE OF INVESTMENTS
June 30, 2021 (Unaudited)

COMMON STOCKS — 98.2%

 

Shares

   

Market Value

 

Communications — 0.3%

               

Entertainment Content — 0.3%

               

Madison Square Garden Entertainment Corporation *

    1,000     $ 83,970  
                 

Consumer Discretionary — 8.2%

               

Automotive — 1.8%

               

Gentex Corporation

    15,000       496,350  
                 

Consumer Services — 3.4%

               

Graham Holdings Company - Class B

    1,500       950,850  
                 

Leisure Facilities & Services — 1.8%

               

Madison Square Garden Sports Corporation *

    3,000       517,710  
                 

Retail - Discretionary — 1.2%

               

TJX Companies, Inc. (The)

    5,000       337,100  
                 

Consumer Staples — 2.5%

               

Beverages — 1.1%

               

Brown-Forman Corporation - Class B

    2,000       149,880  

Remy Cointreau S.A. - ADR

    8,000       165,680  
              315,560  

Retail - Consumer Staples — 1.4%

               

Kroger Company (The)

    10,000       383,100  
                 

Energy — 13.9%

               

Oil & Gas Producers — 11.7%

               

Chevron Corporation

    11,550       1,209,747  

Devon Energy Corporation

    30,000       875,700  

Pioneer Natural Resources Company

    7,240       1,176,645  
              3,262,092  

Oil & Gas Services & Equipment — 2.2%

               

Schlumberger Ltd.

    19,800       633,798  
                 

Financials — 10.7%

               

Institutional Financial Services — 5.6%

               

CME Group, Inc.

    4,650       988,962  

Intercontinental Exchange, Inc.

    4,800       569,760  
              1,558,722  

Insurance — 5.1%

               

Berkshire Hathaway, Inc. - Class A *

    2       837,202  

Markel Corporation *

    500       593,355  
              1,430,557  

 

 

4

 

 

 

SCHWARTZ VALUE FOCUSED FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 98.2% (Continued)

 

Shares

   

Market Value

 

Health Care — 2.2%

               

Biotech & Pharma — 1.4%

               

Avid Bioservices, Inc. *

    15,000     $ 384,750  
                 

Medical Equipment & Devices — 0.8%

               

Alcon, Inc.

    3,400       238,884  
                 

Industrials — 7.6%

               

Electrical Equipment — 3.7%

               

A.O. Smith Corporation

    5,000       360,300  

AMETEK, Inc.

    1,000       133,500  

Vontier Corporation

    16,300       531,054  
              1,024,854  

Engineering & Construction — 1.8%

               

frontdoor, inc. *

    10,000       498,200  
                 

Industrial Support Services — 2.1%

               

AMERCO

    1,000       589,400  
                 

Materials — 16.1%

               

Chemicals — 3.5%

               

Valvoline, Inc.

    30,000       973,800  
                 

Metals & Mining — 12.6%

               

Barrick Gold Corporation

    75,000       1,551,000  

Franco-Nevada Corporation

    7,690       1,115,588  

Pan American Silver Corporation

    30,000       857,100  
              3,523,688  

Real Estate — 31.5%

               

Real Estate Owners & Developers — 31.5%

               

Texas Pacific Land Corporation

    5,500       8,798,570  
                 

Technology — 5.2%

               

Technology Hardware — 1.3%

               

Garmin Ltd.

    2,500       361,600  
                 

Technology Services — 3.9%

               

Mastercard, Inc. - Class A

    1,500       547,635  

Moody’s Corporation

    1,500       543,555  
              1,091,190  
                 

Total Common Stocks (Cost $13,746,613)

          $ 27,454,745  

 

 

5

 

 

 

SCHWARTZ VALUE FOCUSED FUND
SCHEDULE OF INVESTMENTS
(Continued)

MONEY MARKET FUNDS — 1.9%

 

Shares

   

Market Value

 

Federated Hermes Government Obligations Tax-Managed Fund - Institutional Shares, 0.01% (a) (Cost $544,826)

    544,826     $ 544,826  
                 

Total Investments at Market Value — 100.1% (Cost $14,291,439)

          $ 27,999,571  
                 

Liabilities in Excess of Other Assets — (0.1%)

            (41,911 )
                 

Net Assets — 100.0%

          $ 27,957,660  

 

ADR - American Depositary Receipt.

*

Non-income producing security.

(a)

The rate shown is the 7-day effective yield as of June 30, 2021.

See notes to financial statements.

 

 

6

 

 

 

SCHWARTZ VALUE FOCUSED FUND
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2021 (Unaudited)

ASSETS

       

Investments, at market value (cost of $14,291,439) (Note 1)

  $ 27,999,571  

Cash

    1,675  

Receivable for capital shares sold

    13  

Dividends receivable

    4,926  

Other assets

    13,220  

TOTAL ASSETS

    28,019,405  
         

LIABILITIES

       

Payable for capital shares redeemed

    2,939  

Payable to Adviser (Note 2)

    47,932  

Payable to administrator (Note 2)

    3,000  

Other accrued expenses

    7,874  

TOTAL LIABILITIES

    61,745  
         

NET ASSETS

  $ 27,957,660  
         

NET ASSETS CONSIST OF:

       

Paid-in capital

  $ 13,953,784  

Accumulated earnings

    14,003,876  

NET ASSETS

  $ 27,957,660  
         

Shares of beneficial interest outstanding (unlimited number of shares authorized, no par value)

    664,406  
         

Net asset value, offering price and redemption price per share (Note 1)

  $ 42.08  

 

See notes to financial statements.

 

 

7

 

 

 

SCHWARTZ VALUE FOCUSED FUND
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 2021 (Unaudited)

INVESTMENT INCOME

       

Dividends

  $ 146,931  

Foreign withholding taxes on dividends

    (3,131 )

Interest

    9  

TOTAL INVESTMENT INCOME

    143,809  
         

EXPENSES

       

Investment advisory fees (Note 2)

    115,072  

Administration, accounting and transfer agent fees (Note 2)

    18,000  

Legal fees

    15,390  

Registration and filing fees

    11,444  

Audit and tax services fees

    7,967  

Printing of shareholder reports

    3,482  

Custodian and bank service fees

    2,932  

Insurance expense

    2,309  

Postage and supplies

    1,952  

Trustees’ fees and expenses (Note 2)

    1,638  

Compliance service fees and expenses (Note 2)

    191  

Other expenses

    8,026  

TOTAL EXPENSES

    188,403  

Less fee reductions by the Adviser (Note 2)

    (36,993 )

NET EXPENSES

    151,410  
         

NET INVESTMENT LOSS

    (7,601 )
         

REALIZED AND UNREALIZED GAINS ON INVESTMENTS

       

Net realized gains from investment transactions

    303,345  

Net change in unrealized appreciation (depreciation) on investments

    6,472,492  

NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS

    6,775,837  
         

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS

  $ 6,768,236  

 

See notes to financial statements.

 

 

8

 

 

 

SCHWARTZ VALUE FOCUSED FUND
STATEMENTS OF CHANGES IN NET ASSETS

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year Ended
December 31,
2020

 

FROM OPERATIONS

               

Net investment income (loss)

  $ (7,601 )   $ 86,594  

Net realized gains from investment transactions

    303,345       1,064,145  

Net change in unrealized appreciation (depreciation) on investments

    6,472,492       32,795  

Net increase in net assets resulting from operations

    6,768,236       1,183,534  
                 

FROM DISTRIBUTIONS TO SHAREHOLDERS (Note 1)

          (432,624 )
                 

FROM CAPITAL SHARE TRANSACTIONS

               

Proceeds from shares sold

    6,229,968       326,068  

Reinvestment of distributions to shareholders

          406,915  

Payments for shares redeemed

    (3,137,779 )     (5,847,988 )

Net increase (decrease) in net assets from capital share transactions

    3,092,189       (5,115,005 )
                 

TOTAL INCREASE (DECREASE) IN NET ASSETS

    9,860,425       (4,364,095 )
                 

NET ASSETS

               

Beginning of period

    18,097,235       22,461,330  

End of period

  $ 27,957,660     $ 18,097,235  
                 

SUMMARY OF CAPITAL SHARE ACTIVITY

               

Shares sold

    150,366       12,685  

Shares issued in reinvestment of distributions to shareholders

          13,307  

Shares redeemed

    (78,449 )     (234,795 )

Net increase (decrease) in shares outstanding

    71,917       (208,803 )

Shares outstanding, beginning of period

    592,489       801,292  

Shares outstanding, end of period

    664,406       592,489  

 

See notes to financial statements.

 

 

9

 

 

 

SCHWARTZ VALUE FOCUSED FUND
FINANCIAL HIGHLIGHTS

Per Share Data for a Share Outstanding Throughout Each Period

 

 

Six Months
Ended
June 30,
2021
(Unaudited)

   

Year
Ended
Dec. 31,
2020

   

Year
Ended
Dec. 31,
2019

   

Year
Ended
Dec. 31,
2018

   

Year
Ended
Dec. 31,
2017

   

Year
Ended
Dec. 31,
2016

 

Net asset value at beginning of period

  $ 30.54     $ 28.03     $ 23.62     $ 26.44     $ 25.02     $ 21.18  
                                                 

Income (loss) from investment operations:

                                               

Net investment income (loss)

    (0.01 )     0.15       (0.03 )     (0.08 )     (0.13 )     (0.08 )

Net realized and unrealized gains (losses) on investments

    11.55       3.11       4.44       (2.08 )     3.57       3.92  

Total from investment operations

    11.54       3.26       4.41       (2.16 )     3.44       3.84  
                                                 

Less distributions from:

                                               

Net investment income

          (0.15 )                        

Net realized gains on investments

          (0.60 )           (0.66 )     (2.02 )      

Total distributions

          (0.75 )           (0.66 )     (2.02 )      
                                                 

Net asset value at end of period

  $ 42.08     $ 30.54     $ 28.03     $ 23.62     $ 26.44     $ 25.02  
                                                 

Total return (a)

    37.79 %(b)     11.62 %     18.67 %     (8.14 %)     13.71 %     18.13 %
                                                 

Ratios/Supplementary Data:

                                               

Net assets at end of period (000’s)

  $ 27,958     $ 18,097     $ 22,461     $ 19,428     $ 22,592     $ 21,012  
                                                 

Ratio of total expenses to average net assets

    1.55 %(c)     1.71 %     1.61 %     1.67 %     1.79 %     1.80 %
                                                 

Ratio of net expenses to average net assets (d)

    1.25 %(c)     1.25 %     1.25 %     1.25 %     1.25 %     1.25 %
                                                 

Ratio of net investment income (loss) to average net assets (d)

    (0.06 %)(c)     0.49 %     (0.13 %)     (0.31 %)     (0.52 %)     (0.35 %)
                                                 

Portfolio turnover rate

    2 %(b)     45 %     28 %     34 %     48 %     48 %

 

(a)

Total return is a measure of the change in value of an investment in the Fund over the period covered, which assumes any dividends or capital gains distributions are reinvested in shares of the Fund. Returns shown do not reflect the deduction of taxes a shareholder would pay on Fund distributions or the redemption of Fund shares.

(b)

Not annualized.

(c)

Annualized.

(d)

Ratio was determined after advisory fee reductions (Note 2).

See notes to financial statements.

 

 

10

 

 

 

SCHWARTZ VALUE FOCUSED FUND
NOTES TO FINANCIAL STATEMENTS
June 30, 2021 (Unaudited)

 

 

1. Significant Accounting Policies

 

Schwartz Value Focused Fund (the “Fund”) is a non-diversified series of Schwartz Investment Trust (the “Trust”), an open-end management investment company established as an Ohio business trust under a Declaration of Trust dated August 31, 1992. Other series of the Trust are not incorporated in this report. The Fund is registered under the Investment Company Act of 1940, as amended (the “1940 Act”).

 

The investment objective of the Fund is to seek long-term capital appreciation. See the Prospectus for information regarding the principal investment strategies of the Fund.

 

Shares of the Fund are sold at net asset value (“NAV”). To calculate the NAV, the Fund’s assets are valued and totaled, liabilities are subtracted, and the balance is divided by the number of shares outstanding. The offering price and redemption price per share are equal to the NAV per share.

 

The Fund follows accounting and reporting guidance under Financial Accounting Standards Board Accounting Standards Codification Topic 946, “Financial Services – Investment Companies.” The following is a summary of the Fund’s significant accounting policies used in the preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

 

(a) Valuation of investments — Securities which are traded on stock exchanges, other than NASDAQ, are valued at the closing sales price as of the close of the regular session of trading on the New York Stock Exchange on the day the securities are being valued, or, if not traded on a particular day, at the closing bid price. Securities which are quoted by NASDAQ are valued at the NASDAQ Official Closing Price or, if an Official Closing Price is not available, at the most recently quoted bid price. Securities traded in the over-the-counter market are valued at the last reported sales price or, if there is no reported sale on the valuation date, at the most recently quoted bid price. Securities which are traded both in the over-the-counter market and on a stock exchange are valued according to the broadest and most representative market. Fixed income securities, if any, are generally valued using prices provided by an independent pricing service. The independent pricing service uses information with respect to transactions in bonds, quotations from bond dealers, market transactions in comparable securities and various relationships between securities in determining these prices. Investments representing shares of other open-end investment companies are valued at their NAV as reported by such companies. When using quoted prices and when the market for the securities are considered active, the securities will be classified as Level 1 within the fair value hierarchy (see below). Securities (and other assets) for which market quotations are not readily available are valued at their fair value as determined in good faith in accordance with consistently applied procedures established by and under the general supervision of the Board of Trustees, and will be classified as Level 2 or 3 within the fair value hierarchy, depending on the inputs used. Fair value pricing may be used, for example, in situations where (i) a portfolio security is so thinly traded that there have been no transactions for that stock over an extended period of time; (ii) the exchange on which the portfolio security

 

11

 

 

 

SCHWARTZ VALUE FOCUSED FUND
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

is principally traded closes early; or (iii) trading of the portfolio security is halted during the day and does not resume prior to the Fund’s NAV calculation. A portfolio security’s “fair value” price may differ from the price next available for that portfolio security using the Fund’s normal pricing procedures.

 

GAAP establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements.

 

Various inputs are used in determining the value of the Fund’s investments. These inputs are summarized in the three broad levels listed below:

 

●    Level 1 – quoted prices in active markets for identical securities

 

●    Level 2 – other significant observable inputs

 

●    Level 3 – significant unobservable inputs

 

U.S. Government & Agencies securities held by the Fund, if any, are classified as Level 2 since the values for such securities are based on prices provided by an independent pricing service that utilizes various “other significant observable inputs” including bid and ask quotations, prices of similar securities and interest rates, among other factors.

 

The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement.

 

The following is a summary of the Fund’s investments and the levels assigned to the investments, by security type, as of June 30, 2021:

 

 

 

Level 1

   

Level 2

   

Level 3

   

Total

 

Common Stocks

  $ 27,454,745     $     $     $ 27,454,745  

Money Market Funds

    544,826                   544,826  

Total

  $ 27,999,571     $     $     $ 27,999,571  

 

Refer to the Fund’s Schedule of Investments for a listing of the securities by security type, sector and industry type. There were no Level 3 securities or derivative instruments held by or transferred in/out of the Fund as of or during the six months ended June 30, 2021.

 

(b) Income taxes — The Fund has qualified and intends to continue to qualify as a regulated investment company under the Internal Revenue Code of 1986, as amended (the “Code”). Qualification generally will relieve the Fund of liability for federal income taxes to the extent 100% of its net investment income and net realized capital gains are distributed in accordance with the Code.

 

12

 

 

 

SCHWARTZ VALUE FOCUSED FUND
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

In order to avoid imposition of the excise tax applicable to regulated investment companies, it is also the Fund’s intention to declare as dividends in each calendar year at least 98% of its net investment income and 98.2% of its net realized capital gains plus undistributed amounts from prior years.

 

The following information is computed on a tax basis for each item as of June 30, 2021:

 

Federal income tax cost

  $ 14,291,439  

Gross unrealized appreciation

  $ 13,960,194  

Gross unrealized depreciation

    (252,062 )

Net unrealized appreciation

    13,708,132  

Accumulated ordinary loss

    (7,601 )

Other gains

    303,345  

Accumulated earnings

  $ 14,003,876  

 

The Fund recognizes the tax benefits or expenses of uncertain tax positions only when the position is “more-likely-than-not” to be sustained assuming examination by tax authorities. Management has reviewed the tax positions taken on federal income tax returns for the current and all open tax years (generally, three years) and has concluded that no provision for unrecognized tax benefits or expenses is required in these financial statements.

 

(c) Investment transactions and investment income — Investment transactions are accounted for on the trade date. Dividend income is recorded on the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on the accrual basis. Realized capital gains and losses on investment transactions are determined on the identified cost basis. Withholding taxes on foreign dividends have been recorded in accordance with the Fund’s understanding of the applicable country’s rules and tax rates.

 

(d) Dividends and distributions — Dividends from net investment income and distributions of net realized capital gains, if any, are declared and paid annually in December. Dividends and distributions to shareholders are recorded on the ex-dividend date. The tax character of distributions paid to shareholders during the periods ended June 30, 2021 and December 31, 2020 was as follows:

 

Period Ended

 

Ordinary Income

   

Long-Term
Capital Gains

   

Total
Distributions*

 

June 30, 2021

  $     $     $  

December 31, 2020

  $ 86,594     $ 346,007     $ 432,601  

 

 

*

Total Distributions may not tie to the amount listed on the Statements of Changes in Net Assets due to reclassifications of the character of the distributions as a result of permanent differences between the financial statements and income tax reporting.

 

13

 

 

 

SCHWARTZ VALUE FOCUSED FUND
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

(e) Estimates — The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

(f) Common expenses — Common expenses of the Trust are allocated among the Fund and the other series of the Trust based on relative net assets of each series or the nature of the services performed and the relative applicability to each series.

 

2. Investment Advisory Agreement and Transactions with Related Parties

 

The Chairman and President of the Trust is also the Chairman and Chief Executive Officer of Schwartz Investment Counsel, Inc. (the “Adviser”). Certain other officers of the Trust are officers of the Adviser, or of Ultimus Fund Solutions, LLC (“Ultimus”), the administrative, accounting and transfer agent for the Fund, or of Ultimus Fund Distributors, LLC (the “Distributor”), the Fund’s principal underwriter.

 

Pursuant to an Investment Advisory Agreement between the Trust and the Adviser, the Adviser is responsible for the management of the Fund and provides investment advice along with the necessary personnel, facilities, equipment and certain other services necessary to the operations of the Fund. The Adviser receives from the Fund a quarterly fee at the annual rate of 0.95% per annum of the Fund’s average daily net assets.

 

The Adviser has contractually agreed to reduce its advisory fees or reimburse a portion of the Fund’s expenses until at least May 1, 2022 so that the ordinary operating expenses of the Fund do not exceed 1.25% per annum of average daily net assets. Accordingly, during the six months ended June 30, 2021, the Adviser reduced its investment advisory fees by $36,993.

 

Any fee reductions or expense reimbursements by the Adviser are subject to repayment by the Fund for a period of three years after such fees and expenses were incurred, provided repayment to the Adviser does not cause the ordinary operating expenses of the Fund to exceed 1.25% per annum of average daily net assets. As of June 30, 2021, the Adviser may seek recoupment of investment advisory fee reductions totaling $220,361 no later than the dates stated below:

 

December 31, 2021

  $ 27,561  

December 31, 2022

    76,087  

December 31, 2023

    79,720  

June 30, 2024

    36,993  

Total

  $ 220,361  

 

The Chief Compliance Officer of the Trust (the “CCO”) is an employee of the Adviser. The Trust pays the Adviser a fee for providing CCO services, of which the Fund pays its proportionate share along with the other series of the Trust. In addition, the Trust reimburses the Adviser for out-of-pocket expenses incurred, if any, for providing these services.

 

14

 

 

 

SCHWARTZ VALUE FOCUSED FUND
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

Pursuant to a Mutual Fund Services Agreement between the Trust and Ultimus, Ultimus supplies regulatory and compliance services, calculates the daily NAV per share, maintains the financial books and records of the Fund, maintains the records of each shareholder’s account, and processes purchases and redemptions of the Fund’s shares. For these services Ultimus receives fees computed as a percentage of the average daily net assets of the Fund, subject to a minimum monthly fee.

 

Pursuant to a Distribution Agreement between the Trust and the Distributor, the Distributor serves as the Fund’s exclusive agent for the distribution of its shares. The Distributor is an affiliate of Ultimus.

 

Trustees and officers affiliated with the Adviser or Ultimus are not compensated by the Trust for their services. Each Trustee who is not an affiliated person of the Adviser or Ultimus (“Independent Trustee”) receives from the Trust an annual retainer of $53,000 (except that such fee is $64,500 for the Lead Independent Trustee/Chairman of the Governance Committee and $59,500 for the Chairman of the Audit Committee), payable quarterly; a fee of $6,000 for attendance at each meeting of the Board of Trustees; plus reimbursement of travel and other expenses incurred in attending meetings. Trustee Emeritus receives one-half of both the annual retainer and fee for attendance at each meeting; plus reimbursement of travel and other expenses incurred in attending meetings. The Fund pays its proportionate share of the Independent Trustees’ fees and expenses along with the other series of the Trust.

 

3. Investment Transactions

 

During the six months ended June 30, 2021, cost of purchases and proceeds from sales and maturities of investment securities, excluding short-term investments and U.S. government securities, amounted to $4,313,276 and $525,831, respectively.

 

4. Contingencies and Commitments

 

The Fund indemnifies the Trust’s officers and Trustees for certain liabilities that might arise from their performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, based on experience, the Fund expects the risk of loss to be remote.

 

5. Sector Risk

 

If a Fund has significant investments in the securities of issuers in industries within a particular sector, any development affecting that sector will have a greater impact on the value of the net assets of the Fund than would be the case if the Fund did not have significant investments in that sector. In addition, this may increase the risk of loss of an investment in the Fund and increase the volatility of the Fund’s NAV per share. From time to time, circumstances may affect a particular sector and the companies within such sector. For instance, economic or market factors, regulation or deregulation, and technological or other developments may negatively impact all companies in a particular

 

15

 

 

 

SCHWARTZ VALUE FOCUSED FUND
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

sector and therefore the value of a Fund’s portfolio will be adversely affected. As of June 30, 2021, the Fund had 31.5% of the value of its net assets invested in stocks within the real estate sector.

 

6. Subsequent Events

 

The Fund is required to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed as of the date of the Statement of Assets and Liabilities. For non-recognized subsequent events that must be disclosed to keep the financial statements from being misleading, the Fund is required to disclose the nature of the event as well as an estimate of its financial effect, or a statement that such an estimate cannot be made. Management has evaluated subsequent events through the issuance of these financial statements and has noted no such events.

 

16

 

 

 

SCHWARTZ VALUE FOCUSED FUND
ABOUT YOUR FUND’S EXPENSES
(Unaudited)

 

 

We believe it is important for you to understand the impact of costs on your investment. As a shareholder of the Fund, you incur ongoing costs, including management fees and other Fund expenses. The following examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

 

A mutual fund’s ongoing costs are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The ongoing costs reflected in the table below are based on an investment of $1,000 made at the beginning of the most recent semi-annual period (January 1, 2021) and held until the end of the period (June 30, 2021).

 

The table below illustrates the Fund’s ongoing costs in two ways:

 

Actual fund return – This section helps you to estimate the actual expenses that you paid over the period. The “Ending Account Value” shown is derived from the Fund’s actual return, and the third column shows the dollar amount of operating expenses that would have been paid by an investor who started with $1,000 in the Fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period.

 

To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for the Fund under the heading “Expenses Paid During Period.”

 

Hypothetical 5% return – This section is intended to help you compare the Fund’s ongoing costs with those of other mutual funds. It assumes that the Fund had an annual return of 5% before expenses during the period shown, but that the expense ratio is unchanged. In this case, because the return used is not the Fund’s actual return, the result does not apply to your investment. The example is useful in making comparisons because the U.S. Securities and Exchange Commission (the “SEC”) requires all mutual funds to calculate expenses based on a 5% return. You can assess the Fund’s ongoing costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds.

 

Note that expenses shown in the table are meant to highlight and help you compare ongoing costs only. The Fund does not charge sales loads or redemption fees.

 

The calculations assume no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions.

 

More information about the Fund’s expenses, including historical annual expense ratios, can be found in this report. For additional information on operating expenses and other shareholder costs, please refer to the Fund’s Prospectus.

 

 

Beginning
Account Value
January 1, 2021

Ending
Account Value
June 30, 2021

Expenses Paid
During Period*

Based on Actual Fund Return

$1,000.00

$1,170.60

$6.73

Based on Hypothetical 5% Return (before expenses)

$1,000.00

$1,018.60

$6.26

 

*

Expenses are equal to the Fund’s annualized net expense ratio of 1.25% for the period, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

 

17

 

 

 

SCHWARTZ VALUE FOCUSED FUND
APPROVAL OF ADVISORY AGREEMENT
(Unaudited)

 

 

At a meeting held on February 12, 2021 (the “Board Meeting”), the Board of Trustees of the Trust, including the Independent Trustees voting separately, reviewed and unanimously approved the continuation of the Advisory Agreement with Schwartz Investment Counsel, Inc. (the “Adviser”) (the “Advisory Agreement”) on behalf of the Schwartz Value Focused Fund, a series of the Trust (the “Fund”), for an additional one-year period. The Independent Trustees were advised and assisted throughout their evaluation by independent legal counsel experienced in matters relating to the investment management industry. The Independent Trustees met separately with their independent counsel to discuss the continuance of the Advisory Agreement, during which time, no representatives of the Adviser were present.

 

The Board retained Strategic Insight, an independent third-party provider of mutual fund data, to prepare an independent expense and performance summary for the Fund and comparable funds managed by other investment advisers identified by Strategic Insight. The Strategic Insight materials included information regarding advisory fee rates, other operating expenses, expense ratios, and performance comparisons to the Fund’s peer group and to a broad-based securities index. Prior to the Board Meeting, the Independent Trustees discussed separately with Strategic Insight the methodologies that it used to construct its report and the Morningstar, Inc. (“Morningstar”) categories that it identified to base its peer group comparisons for the Fund and other aspects of its report. The Independent Trustees also received and reviewed relevant information provided by the Adviser in response to requests of the Independent Trustees and their independent legal counsel to assist in their evaluation of the terms of the Advisory Agreement, including, among other things, information about the Adviser’s profitability with respect to each Fund, financial results and condition and management fee revenues. The Board additionally considered the Fund’s portfolio management and compliance structure, brokerage commissions, turnover rates, and the ways in which the Fund realizes economies of scale. The Board also received copies of the advisory agreement and a memorandum from the independent legal counsel to the Independent Trustees discussing the factors the Board should consider in evaluating the continuation of the Advisory Agreement.

 

The Independent Trustees noted that they had meet with the portfolio managers of the Fund at regularly scheduled meetings over the course of the year to discuss the Fund’s portfolio composition and the Adviser’s views of the economic, political and other developments affecting the financial markets in general and the performance of the Fund. They also considered that, during those quarterly meetings, the Adviser had provided its views on the overall condition of the economy and the markets, including its rationale for disposing certain positions and purchasing others. As part of this process, the Trustees considered various factors, none of which by itself was considered dispositive, including:

 

 

the nature, extent and quality of the services provided by the Adviser (including any possible fall-out benefits);

 

 

the fees charged for those services and the Adviser’s profitability with respect to the Fund (and the methodology by which such profitability was calculated);

 

 

the Fund’s performance;

 

18

 

 

 

SCHWARTZ VALUE FOCUSED FUND
APPROVAL OF ADVISORY AGREEMENT
(Unaudited) (Continued)

 

 

 

the extent to which economies of scale may be realized as the Fund grows; and

 

 

whether current fee levels reflect these economies of scale for the benefit of the Fund’s shareholders.

 

Nature, Extent and Quality of Services

 

In evaluating the nature, quality and extent of services provided by the Adviser, the Independent Trustees noted the Adviser’s statement that its responsibilities go beyond providing investment research and advice, and include various operational matters, including the selection of brokers and dealers to execute portfolio transactions and the monitoring of various compliance activities. The Independent Trustees also took into account the Adviser’s investment team, its ownership structure, the manner by which the Adviser conducts fundamental research, its stability, and the quality of its risk management program. The Independent Trustees noted that the Adviser has indicated to the Board that it remains focused on its core investment philosophy and has adhered to its stated approach in the portfolio management process for the Fund. The Independent Trustees also considered information provided by the Adviser regarding its business continuity and disaster recovery plan as well as information regarding how the Adviser functioned during the period of remote work environment caused by the global pandemic. Finally, the Independent Trustees examined whether the Adviser experienced any indirect benefit (i.e., fall-out benefits) for serving as investment adviser to the Fund, and after taking into account all this information, concluded that the nature, extent and quality of services provided by the Adviser to the Fund is satisfactory.

 

Investment Performance

 

The Independent Trustees considered the performance of the Fund against its Morningstar category peers for the one-year period ended November 30, 2020 and noted that the Fund placed in the second quartile of its Morningstar peer category. The Independent Trustees also compared the performance of the Fund over selected periods ended November 30, 2020 with its benchmark index, and noted that the Fund placed below the returns of its benchmark index during the one-year period. In that regard, the Independent Trustees engaged in a discussion on the underperformance of the Fund against its benchmarks, and noted that management continues to keep the Board apprised of the possible reasons for the relative underperformance. The Independent Trustees concluded that the performance of the Fund was acceptable.

 

The Costs of Services and Profits to be Realized by the Adviser

 

The Trustees reviewed information provided by Strategic Insight on the advisory fees paid by the Fund and compared such fees to the advisory fees paid by similar mutual funds, as compiled by Morningstar. The Trustees compared the Fund’s total expense ratio, of which the Fund’s advisory fee is a part, with the total expense ratio of representative funds within its Morningstar peer group for periods ended November 30, 2020 and noted that the total expense ratio for the Fund was lower than the median net management fee ratios of its Morningstar peers. The Independent Trustees took into account that the Adviser’s management fee waivers during the 2020 calendar year with respect to the

 

19

 

 

 

SCHWARTZ VALUE FOCUSED FUND
APPROVAL OF ADVISORY AGREEMENT
(Unaudited) (Continued)

 

 

Fund had the effect of reducing its total annual operating expenses. After taking into account all this information, the Independent Trustees found that the advisory fees and total expenses of the Fund are acceptable,

 

The Independent Trustees also considered the Adviser’s costs of providing ongoing services to the Fund, the profits of the Adviser with respect to the Fund and the methodologies by which the Adviser calculated that profitability information, and concluded that the profits of the Adviser are reasonable and represent a fair and entrepreneurial profit in light of the quality and scope of services that are provided to the Fund.

 

The Extent to Which Economies of Scale Would be Realized and Whether Advisory Fee Levels Reflect these Economies of Scale

 

The Independent Trustees considered the extent to which shareholders have realized economics of scale with respect to the management of the Fund. The Independent Trustees discussed that the Adviser has a history of waiving the expenses of the Fund in order to maintain a lower total annual operating expense ratio for the Fund. The Independent Trustees concluded that the extent to which shareholders could achieve economies of scale as the Fund grows is acceptable.

 

Conclusion

 

The Board, including the Independent Trustees, subsequently concluded that the existing Advisory Agreement is fair and reasonable and voted to approve the continuance of the Advisory Agreement. In reaching their decision regarding the continuation of the Advisory Agreement, the Board, including the Independent Trustees, did not identify any single factor or particular information as controlling, and each Trustee may have attributed different weights to certain factors. Rather, the Trustees concluded, in light of a weighing and balancing of all factors considered, that it was in the best interests of the Fund and its shareholders to renew the Advisory Agreement for an additional annual period.

 

20

 

 

 

SCHWARTZ VALUE FOCUSED FUND
OTHER INFORMATION
(Unaudited)

 

 

A description of the policies and procedures the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge upon request by calling toll-free (888) 726-0753, or on the SEC’s website at www.sec.gov. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is also available without charge upon request by calling toll-free (888) 726-0753, or on the SEC’s website at www.sec.gov.

 

The Trust files a complete listing of portfolio holdings for the Fund with the SEC as of the end of the first and third quarters of each fiscal year as an exhibit on Form N-PORT. The filings are available free of charge, upon request, by calling (888) 726-0753. Furthermore, you may obtain a copy of the filings on the SEC’s website at www.sec.gov.

 

21

 

 

 

 

 

 

 

 

 

 

Shareholder Accounts

c/o Ultimus Fund Solutions, LLC

P.O. Box 46707

Cincinnati, OH 45246

(888) 726-9331

Corporate Offices

801 W. Ann Arbor Trail

Suite 244

Plymouth, MI 48170

(734) 455-7777

Fax (734) 455-7720

 

 

Dear Fellow Shareholders of:

 

Ave Maria Value Fund (AVEMX)
Ave Maria Growth Fund (AVEGX)
Ave Maria Rising Dividend Fund (AVEDX)
Ave Maria World Equity Fund (AVEWX)
Ave Maria Focused Fund (AVEAX)
Ave Maria Bond Fund (AVEFX)
Ave Maria Money Market Account

 

Forecasting future economic activity is perilous, and our team of CFAs, MBAs, CPAs and economists are no better than most at doing it. Notwithstanding, our best guess is that the next recession will be at least a few years away. Currently, corporate earnings are surging, as the U.S. economy recovers from COVID and related shutdowns. The massive monetary and fiscal stimulation is also making a positive impact on the economy. It’s well known that in the long run, stock prices reflect corporate profits, but in the short run, the two are not tethered. Amid current uncertainties (I hate that phrase, because there are always uncertainties), we continue to uncover attractive investment opportunities for each of the Ave Maria Mutual Funds. We remain bullish on the long-term sustainability and growth of the U.S. economy and U.S.– style capitalism.

 

Virtually every economic indicator we monitor is pointing to higher inflation ahead. The Fed agrees but says it will be “transitory.” I hope the Fed is right, but we’re preparing for permanently higher prices for goods and services. Accordingly, our analysts and portfolio managers are focusing on companies with pricing power to preserve profit margins. Interest rates will likely rise as a result of, or in anticipation of, rising inflation. Many equities investors are worried about such a development. But it’s worth remembering that rising interest rates are often symptomatic of strong economic growth and rising corporate loan demand to fund capital expenditures and job creation. Combined with revved up consumer spending, GDP expansion could be meaningful. Hopefully, the massive monetary and fiscal stimulation doesn’t add significantly to inflationary expectations and aggravate a more normal rise of rates concomitant with a stronger economy.

 

 

Thank you for being an Ave Maria Mutual Funds shareholder. Our team continues to work diligently on your behalf. Your trust in us reinforces our effort to make prudent investment decisions in a morally responsible way.

 

Sincerely,

 

 

George P. Schwartz, CFA
Chairman & CEO

 

June 30, 2021

 

iv

 

 

 

AVE MARIA MUTUAL FUNDS
TABLE OF CONTENTS

 

 

   

Ave Maria Value Fund

 

Portfolio Manager Commentary

2

Ten Largest Equity Holdings

5

Asset Allocation

5

Schedule of Investments

6

Ave Maria Growth Fund

 

Portfolio Manager Commentary

9

Ten Largest Holdings

11

Asset Allocation

11

Schedule of Investments

12

Ave Maria Rising Dividend Fund

 

Portfolio Manager Commentary

15

Ten Largest Holdings

17

Asset Allocation

17

Schedule of Investments

18

Ave Maria World Equity Fund

 

Portfolio Manager Commentary

21

Ten Largest Holdings

23

Asset Allocation

23

Schedule of Investments

24

Summary of Common Stocks by Country

27

Ave Maria Focused Fund

 

Portfolio Manager Commentary

28

Ten Largest Holdings

31

Asset Allocation

31

Schedule of Investments

32

Ave Maria Bond Fund

 

Portfolio Manager Commentary

34

Ten Largest Holdings

36

Asset Allocation

36

Schedule of Investments

37

 

 

 

 

AVE MARIA MUTUAL FUNDS
TABLE OF CONTENTS
(Continued)

 

 

Statements of Assets and Liabilities

42

Statements of Operations

44

Statements of Changes in Net Assets

 

Ave Maria Value Fund

46

Ave Maria Growth Fund

47

Ave Maria Rising Dividend Fund

48

Ave Maria World Equity Fund

49

Ave Maria Focused Fund

50

Ave Maria Bond Fund

51

Financial Highlights

 

Ave Maria Value Fund

52

Ave Maria Growth Fund

53

Ave Maria Rising Dividend Fund

54

Ave Maria World Equity Fund

55

Ave Maria Focused Fund

56

Ave Maria Bond Fund

57

Notes to Financial Statements

58

About Your Funds’ Expenses

70

Other Information

72

Approval of Advisory Agreements

73

 

This report is for the information of the shareholders of the Ave Maria Mutual Funds. To obtain a copy of the prospectus, please visit our website at www.avemariafunds.com or call 1-888-726-9331 and a copy will be sent to you free of charge. Please read the prospectus carefully before you invest. The Ave Maria Mutual Funds are distributed by Ultimus Fund Distributors, LLC.

 

Past performance is not predictive of future performance. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be higher or lower than the performance data quoted. Performance data, current to the most recent month end, is available at the Ave Maria Mutual Funds website at www.avemariafunds.com or by calling 1-888-726-9331.

 

 

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Ave Maria Value Fund

Portfolio Manager Commentary

(Unaudited)

 

 

Dear Fellow Shareholders,

 

The Ave Maria Value Fund (the “Fund”) had a good start to the year with a total return of 22.46% for the 6-month period ended June 30, 2021 compared to 17.60% for the S&P MidCap 400 Index.

 

The Fund also performed well for the 1-year period ended June 30, 2021 with a total return of 56.76% compared to 53.24% for the S&P MidCap 400 Index. For the 1-year period, the Fund placed in the top 19th percentile out of 389 mid-cap blend funds, according to Morningstar1.

 

The Fund’s recent outperformance was driven by strong gains in 3 sectors: health care, energy, and financials. For the first 6 months of 2021, the Fund’s two best performing stocks were Avid Bioservices, Inc. (“Avid”) +131%, and Texas Pacific Land Corporation (“TPL”) +121%. Avid is a rapidly growing, commercial biologic contract development and manufacturing company focused on the development and manufacture of biopharmaceuticals. Since the Fund’s initial purchase in 2018, the stock price is up more than 10-fold. For its most recent fiscal year, the company recorded annual revenue growth of 61%, while gross margins significantly improved from 7% to more than 30%. Revenue for the current year is expected to grow another 20-25%.

 

TPL’s weighting in the portfolio (13.1% of Fund net assets) is much larger than Avid’s (1.8%), so it had a much greater positive impact on performance. Like Avid, TPL has appreciated nearly 10-fold since the Fund’s initial purchase in 2016. In our view, shares of TPL remain undervalued. The company operates a remarkably profitable royalty business model and owns 880,000 surface acres in West Texas, in the oil and natural gas-rich Permian Basin. With low expenses and minimal capital expenditures, the company produces sizable free cash flow, which it returns to shareholders via dividends (increased for 17 consecutive years) and share repurchases. Additionally, the balance sheet has zero debt with $311 million in cash.

 

1

Ranking based on total return for period ending June 30, 2021. The fund received a Morningstar rank of 76 out of 357 funds for the 3-year period, 56 out of 290 for the 5-year period and 97 out of 202 funds for the 10-year period. Past performance is no guarantee of future results. The highest (or most favorable) percentile rank is one and the lowest (or least favorable) percentile rank is 100.

 

2

 

 

 

AVE MARIA VALUE FUND
PORTFOLIO MANAGER COMMENTARY
(Unaudited) (Continued)

 

 

The Fund’s five best performing securities in the first half of 2021 were:

 

Company

Industry

YTD Return

Avid Bioservices, Inc.

Biopharmaceuticals

131.13%

Texas Pacific Land Corporation

Royalties/real estate

121.06%

KKR & Co., Inc.

Financials - asset management

47.12%

Schlumberger Limited

Oil & gas equipment/services

45.99%

Pioneer Natural Resources

Oil & gas exploration/production

43.75%

 

The primary detractor from performance in the first 6 months of 2021 was Haemonetics Corp. The stock price fell in April after the company announced a large customer declined to renew a supply contract. We viewed this news as a temporary setback and took advantage of the stock price decline to increase the Fund’s position.

 

The Fund’s five worst performing securities in the first half of 2021 were:

 

Company

Industry

YTD Return

Haemonetics Corp.

Medical instruments

-39.27%

Madison Square Garden Entertainment

Entertainment

-17.61%

Barrick Gold Corp.

Metals & mining

-7.90%

Allison Transmission Holdings

Consumer cyclicals

-7.01%

Madison Square Garden Sports

Entertainment

-6.26%

 

During the past six months, 12 stocks were eliminated from the portfolio, most of which were small holdings. Only 2 sizable holdings were liquidated – Spectrum Brands Holdings, Inc. (household & personal products) and Zimmer Biomet Holdings, Inc. (medical devices). Both were long-time holdings that had appreciated substantially and had surpassed our intrinsic value estimates. New positions were established in 5 companies which meet our criteria of owning shares of high-quality businesses, in strong financial condition, selling at a discount to our estimate of intrinsic value: Brown & Brown, Inc. (insurance brokers), Chemed Corporation (plumbing services & hospice care), Intercontinental Exchange, Inc. (financial data & stock exchanges), Vontier Corporation (mobility technology & auto repair solutions), and YETI Holdings Inc. (consumer products).

 

3

 

 

 

AVE MARIA VALUE FUND
PORTFOLIO MANAGER COMMENTARY
(Unaudited) (Continued)

 

 

The Fund’s positive recent performance has not led us to rest on our laurels. We remain committed to working tirelessly to find superior investments that meet our stringent, value-oriented criteria. Thank you for being a shareholder in the Ave Maria Value Fund.

 

Timothy S. Schwartz, CFA

Ryan M. Kuyawa, CFA

Lead Portfolio Manager

Co-Portfolio Manager

 

Past performance is no guarantee of future results. Current and future portfolio holdings are subject to risk.

 

The Funds are not sponsored, endorsed, sold or promoted by Morningstar, Inc. or any of its affiliates (all such entities, collectively, “Morningstar Entities”). The Morningstar Entities make no representation or warranty, express or implied, to individuals who invest in the Funds or any member of the public regarding the advisability of investing in equity securities generally or in the Funds in particular or the ability of the Funds to track the Morningstar benchmarks or general equity market performance. THE MORNINGSTAR ENTITIES DO NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE FUNDS OR ANY DATA INCLUDED THEREIN AND MORNINGSTAR ENTITIES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN.

 

4

 

 

 

AVE MARIA VALUE FUND

Ten Largest Equity Holdings

June 30, 2021 (Unaudited)

 

 

 

Shares

 

 

Company

 

Market Value

   

% of Net Assets

 
    25,500    

Texas Pacific Land Corporation

  $ 40,793,370       13.1 %
    90,000    

Pioneer Natural Resources Company

    14,626,800       4.7 %
    124,000    

Chevron Corporation

    12,987,760       4.2 %
    20,000    

Graham Holdings Company - Class B

    12,678,000       4.1 %
    200,000    

KKR & Company, Inc.

    11,848,000       3.8 %
    20,000    

AMERCO

    11,788,000       3.8 %
    79,000    

Franco-Nevada Corporation

    11,460,530       3.7 %
    330,000    

Valvoline, Inc.

    10,711,800       3.4 %
    14,536    

Alleghany Corporation

    9,696,530       3.1 %
    135,000    

Alcon, Inc.

    9,485,100       3.0 %

 

Asset Allocation (Unaudited)

 

 

 

 

% of Net Assets

 

COMMON STOCKS

       

Sector

       

Communications

    2.0 %

Consumer Discretionary

    11.2 %

Consumer Staples

    1.2 %

Energy

    10.2 %

Financials

    17.7 %

Health Care

    8.3 %

Industrials

    17.2 %

Materials

    11.3 %

Real Estate

    13.8 %

Technology

    3.8 %
         

MONEY MARKET FUNDS, LIABILITIES IN EXCESS OF OTHER ASSETS

    3.3 %
      100.0 %

 

5

 

 

 

AVE MARIA VALUE FUND

Schedule of Investments

June 30, 2021 (Unaudited)

COMMON STOCKS — 96.7%

 

Shares

   

Market Value

 

Communications — 2.0%

               

Internet Media & Services — 0.8%

               

eDreams ODIEGO S.A. - ADR *

    32,729     $ 2,635,427  
                 

Publishing & Broadcasting — 1.2%

               

Liberty Media Corporation - Liberty Formula One - Series C *

    75,000       3,615,750  
                 

Consumer Discretionary — 11.2%

               

Apparel & Textile Products — 2.0%

               

VF Corporation

    75,000       6,153,000  
                 

Automotive — 2.3%

               

Gentex Corporation

    220,000       7,279,800  
                 

Consumer Services — 4.1%

               

Graham Holdings Company - Class B

    20,000       12,678,000  
                 

Leisure Facilities & Services — 2.5%

               

Madison Square Garden Sports Corporation *

    45,000       7,765,650  
                 

Leisure Products — 0.3%

               

Yeti Holdings, Inc. *

    11,700       1,074,294  
                 

Consumer Staples — 1.2%

               

Beverages — 1.2%

               

Remy Cointreau S.A. - ADR

    175,550       3,635,641  
                 

Energy — 10.2%

               

Oil & Gas Producers — 8.9%

               

Chevron Corporation

    124,000       12,987,760  

Pioneer Natural Resources Company

    90,000       14,626,800  
              27,614,560  

Oil & Gas Services & Equipment — 1.3%

               

Schlumberger Ltd.

    125,000       4,001,250  
                 

Financials — 17.7%

               

Asset Management — 3.8%

               

KKR & Company, Inc.

    200,000       11,848,000  
                 

Banking — 1.1%

               

Hingham Institution for Savings (The)

    12,087       3,511,274  

 

 

6

 

 

 

AVE MARIA VALUE FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 96.7% (Continued)

 

Shares

   

Market Value

 

Financials — 17.7% (Continued)

               

Institutional Financial Services — 4.5%

               

CME Group, Inc.

    41,800     $ 8,890,024  

Intercontinental Exchange, Inc.

    42,500       5,044,750  
              13,934,774  

Insurance — 5.9%

               

Alleghany Corporation *

    14,536       9,696,530  

Brown & Brown, Inc.

    29,700       1,578,258  

Markel Corporation *

    5,850       6,942,253  
              18,217,041  

Specialty Finance — 2.4%

               

Fidelity National Financial, Inc.

    175,000       7,605,500  
                 

Health Care — 8.3%

               

Biotech & Pharma — 1.8%

               

Avid Bioservices, Inc. *

    225,000       5,771,250  
                 

Health Care Facilities & Services — 1.5%

               

Chemed Corporation

    9,900       4,697,550  
                 

Medical Equipment & Devices — 5.0%

               

Alcon, Inc.

    135,000       9,485,100  

Haemonetics Corporation *

    90,000       5,997,600  
              15,482,700  

Industrials — 17.2%

               

Aerospace & Defense — 1.6%

               

HEICO Corporation - Class A

    40,000       4,967,200  
                 

Electrical Equipment — 6.1%

               

A.O. Smith Corporation

    80,000       5,764,800  

Otis Worldwide Corporation

    85,000       6,950,450  

Vontier Corporation

    192,500       6,271,650  
              18,986,900  

Engineering & Construction — 2.7%

               

frontdoor, inc. *

    170,000       8,469,400  
                 

Industrial Support Services — 4.7%

               

AMERCO

    20,000       11,788,000  

Watsco, Inc.

    10,000       2,866,400  
              14,654,400  

Transportation Equipment — 2.1%

               

Allison Transmission Holdings, Inc.

    160,000       6,358,400  

 

 

7

 

 

 

AVE MARIA VALUE FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 96.7% (Continued)

 

Shares

   

Market Value

 

Materials — 11.3%

               

Chemicals — 4.4%

               

Axalta Coating Systems Ltd. *

    100,000     $ 3,049,000  

Valvoline, Inc.

    330,000       10,711,800  
              13,760,800  

Metals & Mining — 6.9%

               

Barrick Gold Corporation

    300,000       6,204,000  

Franco-Nevada Corporation

    79,000       11,460,530  

Newmont Corporation

    60,000       3,802,800  
              21,467,330  

Real Estate — 13.8%

               

Real Estate Owners & Developers — 13.1%

               

Texas Pacific Land Corporation

    25,500       40,793,370  
                 

REITs — 0.7%

               

Lamar Advertising Company - Class A

    20,000       2,088,400  
                 

Technology — 3.8%

               

Software — 1.8%

               

Change Healthcare, Inc. *

    240,000       5,529,600  
                 

Technology Services — 2.0%

               

Jack Henry & Associates, Inc.

    39,250       6,417,767  
                 

Total Common Stocks (Cost $195,801,278)

          $ 301,015,028  

 

MONEY MARKET FUNDS — 3.5%

 

Shares

   

Market Value

 

Federated Hermes Government Obligations Tax-Managed Fund - Institutional Shares, 0.01% (a) (Cost $10,939,908)

    10,939,908     $ 10,939,908  
                 

Total Investments at Market Value — 100.2% (Cost $206,741,186)

          $ 311,954,936  
                 

Liabilities in Excess of Other Assets — (0.2%)

            (540,867 )
                 

Net Assets — 100.0%

          $ 311,414,069  

 

ADR - American Depositary Receipt.

*

Non-income producing security.

(a)

The rate shown is the 7-day effective yield as of June 30, 2021.

See notes to financial statements.

 

 

8

 

 

 

Ave Maria Growth Fund

Portfolio Manager Commentary

(Unaudited)

 

 

Dear Fellow Shareholders,

 

For the six months ended June 30, 2021, the Ave Maria Growth Fund (the “Fund”) had a total return of 13.76%, compared with the benchmark S&P 500 Index total return of 15.25%. For the 3-year, 5-year, and 10-year periods through June 30, 2021, the Fund had an annual total return of 19.54%, 19.34%, and 14.18%, compared with the benchmark annual total return of 18.67%, 17.65%, and 14.84%, respectively.

 

For the six months ended June 30, 2021, top contributors to return include Change Healthcare (healthcare technology), IQVIA Holdings (healthcare technology), S&P Global (financial services), Lowe’s Companies (retail), and Texas Instruments (semiconductors).

 

Top Five Return Contributors (YTD 2021)

Company

Contribution to
Fund Return

Change Healthcare Inc.

+1.38%

IQVIA Holdings Inc.

+1.13%

S&P Global Inc.

+1.06%

Lowe’s Companies, Inc.

+1.03%

Texas Instruments Inc.

+1.01%

 

One of the Fund’s large holdings, Change Healthcare, received an acquisition offer at a price more than double our average purchase price. If the acquisition is approved by regulators, the Fund will receive cash proceeds in exchange for its shares. Another of our large holdings, S&P Global, is in the process of merging with IHS Markit. Together, S&P Global and IHS Markit will be able to offer comprehensive data solutions through S&P Global’s Market Intelligence Platform. The combined company is likely to benefit from organic revenue growth driven by cross-selling opportunities for years to come.

 

Top Five Return Detractors (YTD 2021)

Company

Contribution to
Fund Return

ANSYS, Inc.

-0.24%

Gores Holdings V, Inc.

-0.06%

APi Group Corp.

-0.03%

Autodesk, Inc.

-0.03%

Frontdoor, inc.

-0.01%

 

9

 

 

 

AVE MARIA GROWTH FUND
PORTFOLIO MANAGER COMMENTARY
(Unaudited) (Continued)

 

 

Top detractors from return include ANSYS (simulation software), Gore’s Holdings V (container manufacturing), APi Group (industrial services), Autodesk (design software), and Frontdoor (home services). During the first six months of the year, the Fund exited Zimmer Biomet (orthopedic implants) because of continued disappointment with the company’s growth strategy, and Talend (data integration software) after the stock appreciated substantially following the receipt of an acquisition offer.

 

New additions to the Fund during the first six months of the year included APi Group, BlackRock (financial services), Chemed (conglomerate), and Gores Holdings V.

 

Our goal remains to purchase shares of exceptional companies at attractive prices with the expectations of earning favorable returns over the long run.

 

We appreciate your investment in the Ave Maria Growth Fund.

 

With best regards,

 

Adam P. Gaglio, CFA

Chadd M. Garcia, CFA

Lead Portfolio Manager

Co-Portfolio Manager

 

Past performance is no guarantee of future results. Current and future portfolio holdings are subject to risk.

 

10

 

 

 

AVE MARIA GROWTH FUND

Ten Largest Holdings

June 30, 2021 (Unaudited)

 

 

 

Shares

 

 

Company

 

Market Value

   

% of Net Assets

 
    450,000    

Copart, Inc.

  $ 59,323,500       5.7 %
    300,000    

Texas Instruments, Inc.

    57,690,000       5.6 %
    229,000    

Visa, Inc. - Class A

    53,544,780       5.2 %
    142,000    

Mastercard, Inc. - Class A

    51,842,780       5.0 %
    265,000    

Lowe’s Companies, Inc.

    51,402,050       5.0 %
    180,000    

Microsoft Corporation

    48,762,000       4.7 %
    116,000    

S&P Global, Inc.

    47,612,200       4.6 %
    948,300    

frontdoor, inc.

    47,244,306       4.6 %
    371,876    

HEICO Corporation - Class A

    46,179,562       4.5 %
    57,500    

Equinix, Inc.

    46,149,500       4.5 %

 

Asset Allocation (Unaudited)

 

 

 

 

% of Net Assets

 

COMMON STOCKS

       

Sector

       

Consumer Discretionary

    15.4 %

Consumer Staples

    2.2 %

Financials

    12.1 %

Health Care

    6.0 %

Industrials

    14.9 %

Real Estate

    8.8 %

Technology

    40.1 %
         

MONEY MARKET FUNDS, LIABILITIES IN EXCESS OF OTHER ASSETS

    0.5 %
      100.0 %

 

11

 

 

 

AVE MARIA GROWTH FUND

Schedule of Investments

June 30, 2021 (Unaudited)

COMMON STOCKS — 99.5%

 

Shares

   

Market Value

 

Consumer Discretionary — 15.4%

               

Apparel & Textile Products — 1.3%

               

VF Corporation

    160,000     $ 13,126,400  
                 

Retail - Discretionary — 8.4%

               

Lowe’s Companies, Inc.

    265,000       51,402,050  

O’Reilly Automotive, Inc. *

    63,000       35,671,230  
              87,073,280  

Wholesale - Discretionary — 5.7%

               

Copart, Inc. *

    450,000       59,323,500  
                 

Consumer Staples — 2.2%

               

Retail - Consumer Staples — 2.2%

               

Ollie’s Bargain Outlet Holdings, Inc. *

    266,449       22,416,354  
                 

Financials — 12.1%

               

Asset Management — 7.5%

               

BlackRock, Inc.

    24,000       20,999,280  

Brookfield Asset Management Reinsurance Partners Ltd. - Class A *

    4,914       255,616  

Brookfield Asset Management, Inc. - Class A

    712,500       36,323,250  

Gores Holdings V, Inc. - Class A *

    2,000,000       20,200,000  
              77,778,146  

Diversified Financial Services — 4.6%

               

S&P Global, Inc.

    116,000       47,612,200  
                 

Health Care — 6.0%

               

Health Care Facilities & Services — 3.2%

               

Chemed Corporation

    20,000       9,490,000  

IQVIA Holdings, Inc. *

    100,000       24,232,000  
              33,722,000  

Medical Equipment & Devices — 2.8%

               

Medtronic plc

    233,000       28,922,290  
                 

Industrials — 14.9%

               

Aerospace & Defense — 4.5%

               

HEICO Corporation - Class A

    371,876       46,179,562  
                 

Electrical Equipment — 4.5%

               

API Group Corporation *

    170,000       3,551,300  

Roper Technologies, Inc.

    91,000       42,788,200  
              46,339,500  

 

 

12

 

 

 

AVE MARIA GROWTH FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 99.5% (Continued)

 

Shares

   

Market Value

 

Industrials — 14.9% (Continued)

               

Engineering & Construction — 4.6%

               

frontdoor, inc. *

    948,300     $ 47,244,306  
                 

Transportation & Logistics — 1.3%

               

Expeditors International of Washington, Inc.

    110,000       13,926,000  
                 

Real Estate — 8.8%

               

Real Estate Owners & Developers — 0.8%

               

Texas Pacific Land Corporation

    5,000       7,998,700  
                 

REITs — 8.0%

               

Equinix, Inc.

    57,500       46,149,500  

SBA Communications Corporation

    116,000       36,969,200  
              83,118,700  

Technology — 40.1%

               

Semiconductors — 5.6%

               

Texas Instruments, Inc.

    300,000       57,690,000  
                 

Software — 13.0%

               

ANSYS, Inc. *

    67,000       23,253,020  

Autodesk, Inc. *

    20,000       5,838,000  

Change Healthcare, Inc. *

    990,000       22,809,600  

Microsoft Corporation

    180,000       48,762,000  

Software AG - ADR

    2,967,252       33,262,895  
              133,925,515  

Technology Services — 21.5%

               

Accenture plc - Class A

    141,000       41,565,390  

Broadridge Financial Solutions, Inc.

    256,000       41,351,680  

Mastercard, Inc. - Class A

    142,000       51,842,780  

Moody’s Corporation

    95,000       34,425,150  

Visa, Inc. - Class A

    229,000       53,544,780  
              222,729,780  
                 

Total Common Stocks (Cost $567,090,824)

          $ 1,029,126,233  

 

 

13

 

 

 

AVE MARIA GROWTH FUND
SCHEDULE OF INVESTMENTS
(Continued)

MONEY MARKET FUNDS — 0.7%

 

Shares

   

Market Value

 

Federated Hermes Government Obligations Tax-Managed Fund - Institutional Shares, 0.01% (a) (Cost $7,221,910)

    7,221,910     $ 7,221,910  
                 

Total Investments at Market Value — 100.2% (Cost $574,312,734)

          $ 1,036,348,143  
                 

Liabilities in Excess of Other Assets — (0.2%)

            (2,074,055 )
                 

Net Assets — 100.0%

          $ 1,034,274,088  

 

ADR - American Depositary Receipt.

*

Non-income producing security.

(a)

The rate shown is the 7-day effective yield as of June 30, 2021.

See notes to financial statements.

 

 

14

 

 

 

Ave Maria Rising Dividend Fund

Portfolio Manager Commentary

(Unaudited)

 

 

Dear Fellow Shareholders,

 

For the six months ended June 30, 2021, the total return of the Ave Maria Rising Dividend Fund (the “Fund”) was 16.4%, compared to the S&P 500 Value Index at 16.3%. The Fund had strong returns in the energy, financial and consumer discretionary sectors, up 68%, 21% and 18%, respectively. On an individual security basis, the top three performing stocks were Texas Pacific Land Corp., (royalty income – oil and gas) Pioneer Natural Resources Co. (exploration and production) and First Horizon Corp., (regional bank).

 

The weakest returning sectors for the Fund were in health care, consumer staples and technology, although all three sectors were up for the first half of the year, 7.3% 7.4% and 11.0% respectively. The bottom three performing stocks were ANSYS, Inc., (application software), Chemed Corp., (health care services) and VF Corp., (apparel).

 

During the first half of the year, six positions were eliminated from the Fund: Cisco Systems, Inc. (communications equipment, Eaton Corp. plc (electrical components), Zimmer Biomet Holdings, Inc. (medical devices) and Kellogg Co. (packaged food). Five of the six positions were sold based on valuation, as their share prices exceeded our estimated intrinsic value. Kellogg Co. was sold for better alternative opportunities.

 

Five new positions were established in the Fund’s portfolio: Brookfield Asset Management, Inc. (private equity), Chemed Corp. (health care services), Jack Henry & Associates, Inc. (data & transaction processors), Rentokil Initial plc (building maintenance services) and Brown & Brown, Inc. (insurance brokers). All five have the attributes we look for when establishing new positions, which are listed below.

 

15

 

 

 

AVE MARIA RISING DIVIDEND FUND
PORTFOLIO MANAGER COMMENTARY
(Unaudited) (Continued)

 

 

The Fund’s investment strategy continues to identify companies that have strong balance sheets, operate with sustainable competitive advantages, and consistently produce above-average cash flow and dividend growth. The goal is to buy these companies when they are out of favor and undervalued. We remain confident in the long-term merits of this strategy.

 

We appreciate your investment in the Ave Maria Rising Dividend Fund.

 

George P. Schwartz, CFA

Brandon S. Scheitler, VP

Co-Portfolio Manager

Co-Portfolio Manager

 

Past performance is no guarantee of future results. Current and future portfolio holdings are subject to risk.

 

16

 

 

 

AVE MARIA RISING DIVIDEND FUND

Ten Largest Holdings

June 30, 2021 (Unaudited)

 

 

 

Shares

 

 

Company

 

Market Value

   

% of Net Assets

 
    30,000    

Texas Pacific Land Corporation

  $ 47,992,200       5.0 %
    365,000    

Medtronic plc

    45,307,450       4.8 %
    230,000    

Lowe’s Companies, Inc.

    44,613,100       4.7 %
    190,000    

Visa, Inc. - Class A

    44,425,800       4.7 %
    215,000    

Texas Instruments, Inc.

    41,344,500       4.4 %
    135,000    

Microsoft Corporation

    36,571,500       3.8 %
    2,100,000    

First Horizon National Corporation

    36,288,000       3.8 %
    275,000    

Genuine Parts Company

    34,779,250       3.6 %
    115,000    

Accenture plc - Class A

    33,900,850       3.6 %
    205,000    

Broadridge Financial Solutions, Inc.

    33,113,650       3.5 %

 

Asset Allocation (Unaudited)

 

 

 

 

% of Net Assets

 

COMMON STOCKS

       

Sector

       

Communications

    0.9 %

Consumer Discretionary

    14.3 %

Consumer Staples

    2.6 %

Energy

    5.5 %

Financials

    16.5 %

Health Care

    9.8 %

Industrials

    8.7 %

Real Estate

    8.2 %

Technology

    31.2 %
         

MONEY MARKET FUNDS, LIABILITIES IN EXCESS OF OTHER ASSETS

    2.3 %
      100.0 %

 

17

 

 

 

AVE MARIA RISING DIVIDEND FUND

Schedule of Investments

June 30, 2021 (Unaudited)

COMMON STOCKS — 97.7%

 

Shares

   

Market Value

 

Communications — 0.9%

               

Internet Media & Services — 0.9%

               

Booking Holdings, Inc. *

    4,000     $ 8,752,360  
                 

Consumer Discretionary — 14.3%

               

Apparel & Textile Products — 2.1%

               

VF Corporation

    240,000       19,689,600  
                 

Retail - Discretionary — 12.2%

               

Genuine Parts Company

    275,000       34,779,250  

Lowe’s Companies, Inc.

    230,000       44,613,100  

TJX Companies, Inc. (The)

    300,000       20,226,000  

Tractor Supply Company

    90,000       16,745,400  
              116,363,750  

Consumer Staples — 2.6%

               

Food — 2.6%

               

Mondelēz International, Inc. - Class A

    400,000       24,976,000  
                 

Energy — 5.5%

               

Oil & Gas Producers — 5.5%

               

Chevron Corporation

    260,000       27,232,400  

Pioneer Natural Resources Company

    155,000       25,190,600  
              52,423,000  

Financials — 16.5%

               

Asset Management — 2.1%

               

Brookfield Asset Management Reinsurance Partners Ltd. - Class A *

    2,759       143,503  

Brookfield Asset Management, Inc. - Class A

    400,000       20,392,000  
              20,535,503  

Banking — 7.2%

               

First Horizon National Corporation

    2,100,000       36,288,000  

Truist Financial Corporation

    575,000       31,912,500  
              68,200,500  

Insurance — 4.2%

               

Brown & Brown, Inc.

    180,000       9,565,200  

Chubb Ltd.

    190,000       30,198,600  
              39,763,800  

Specialty Finance — 3.0%

               

Fidelity National Financial, Inc.

    670,000       29,118,200  

 

 

18

 

 

 

AVE MARIA RISING DIVIDEND FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 97.7% (Continued)

 

Shares

   

Market Value

 

Health Care — 9.8%

               

Health Care Facilities & Services — 5.0%

               

Chemed Corporation

    40,000     $ 18,980,000  

Quest Diagnostics, Inc.

    220,000       29,033,400  
              48,013,400  

Medical Equipment & Devices — 4.8%

               

Medtronic plc

    365,000       45,307,450  
                 

Industrials — 8.7%

               

Aerospace & Defense — 4.3%

               

HEICO Corporation - Class A

    137,120       17,027,562  

Lockheed Martin Corporation

    62,500       23,646,875  
              40,674,437  

Commercial Support Services — 1.0%

               

Rentokil Initial plc - ADR

    274,200       9,614,823  
                 

Electrical Equipment — 1.2%

               

Roper Technologies, Inc.

    25,000       11,755,000  
                 

Transportation & Logistics — 2.2%

               

United Parcel Service, Inc. - Class B

    100,000       20,797,000  
                 

Real Estate — 8.2%

               

Real Estate Owners & Developers — 5.0%

               

Texas Pacific Land Corporation

    30,000       47,992,200  
                 

REITs — 3.2%

               

Equinix, Inc.

    37,400       30,017,240  
                 

Technology — 31.2%

               

Semiconductors — 4.4%

               

Texas Instruments, Inc.

    215,000       41,344,500  
                 

Software — 10.7%

               

ANSYS, Inc. *

    28,000       9,717,680  

Microsoft Corporation

    135,000       36,571,500  

SAP SE - ADR

    180,000       25,282,800  

SS&C Technologies Holdings, Inc.

    425,000       30,625,500  
              102,197,480  

 

 

19

 

 

 

AVE MARIA RISING DIVIDEND FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 97.7% (Continued)

 

Shares

   

Market Value

 

Technology — 31.2% (Continued)

               

Technology Services — 16.1%

               

Accenture plc - Class A

    115,000     $ 33,900,850  

Broadridge Financial Solutions, Inc.

    205,000       33,113,650  

Jack Henry & Associates, Inc.

    114,500       18,721,895  

Moody’s Corporation

    65,000       23,554,050  

Visa, Inc. - Class A

    190,000       44,425,800  
              153,716,245  
                 

Total Common Stocks (Cost $618,517,665)

          $ 931,252,488  

 

MONEY MARKET FUNDS — 2.4%

 

Shares

   

Market Value

 

Federated Hermes Government Obligations Tax-Managed Fund - Institutional Shares, 0.01% (a)

    22,687,514     $ 22,687,514  

Federated Hermes Treasury Obligations Fund - Institutional Shares, 0.01% (a)

    71,997       71,997  

Total Money Market Funds (Cost $22,759,511)

          $ 22,759,511  
                 

Total Investments at Market Value — 100.1% (Cost $641,277,176)

          $ 954,011,999  
                 

Liabilities in Excess of Other Assets — (0.1%)

            (989,461 )
                 

Net Assets — 100.0%

          $ 953,022,538  

 

ADR - American Depositary Receipt.

*

Non-income producing security.

(a)

The rate shown is the 7-day effective yield as of June 30, 2021.

See notes to financial statements.

 

 

20

 

 

 

Ave Maria World Equity Fund

Portfolio Manager Commentary

(Unaudited)

 

 

Dear Fellow Shareholders,

 

The Ave Maria World Equity Fund (the “Fund”) had a total return of 12.27% for the six months ended June 30, 2021, compared to the total returns for the MSCI ACWI and S&P Global 1200 indices of 12.30% and 13.20%, respectively (the “global market indices”).

 

By geographic region, the United States provided the best returns among large global equity markets as measured by the S&P 500 Index, which advanced 15.25% in U.S. dollars. The European markets provided the second-best return as measured by the S&P Europe 350 Index, which advanced 12.36% in U.S. dollars.

 

In U.S. dollar terms, stocks in the emerging markets and Japan were laggards during the quarter with the MSCI Emerging Market Index advancing 7.45% and the Topix 150 returning 1.53%.

 

The Fund outperformed the global market indices during the first quarter of the year before taking a step backwards during the second quarter. Returns in both quarters were primarily driven through stock selection. IQVIA Holdings, Inc., which provides biopharmaceutical development and commercial outsourcing services, was our best quarterly performer following comments by company management indicating that new trial startup activity was improving following a slowdown during the pandemic. Adobe, Inc. rose following quarterly results that reflected strong customer adoption of Adobe’s creative cloud solutions and a pickup in spending by small and medium sized businesses. Finally, Otis Worldwide Corporation benefited from strong business execution following its separation from United Technologies.

 

Top returns during the second quarter of 2021:

 

IQVIA Holdings, Inc.

25.46%

Adobe, Inc.

23.20%

Otis Worldwide Corporation

19.83%

 

Top returns during the first half of 2021:

 

First Horizon Corporation

37.73%

IQVIA Holdings, Inc.

35.25%

Adobe, Inc

33.35%

 

The Fund’s worst performing stock during the quarter was Sapiens International Corporation N.V. Sapiens, which provides software solutions for the insurance industry, sold off during the spread of COVID-19 in India, which in turn prevented some workers from completing projects on time. Koninklijke Philips N.V.

 

21

 

 

 

AVE MARIA WORLD EQUITY FUND
PORTFOLIO MANAGER COMMENTARY
(Unaudited) (Continued)

 

 

underperformed following the company’s decision to recall its Dreamstation 1 continuous positive airway pressure (CPAP), and mechanical ventilator devices out of concern that the sound abatement foam component could lead to health risks. Finally, Itochu Corporation’s stock price underperformed, as investors were disappointed with the company’s 2021 dividend payout guidance.

 

Bottom performers during the second quarter:

 

Sapiens International Corporation N.V.

-16.43%

Itochu Corporation

-11.93%

Koninklijke Philips N.V.

-11.25%

 

Bottom performers during the first half of 2021:

 

Sapiens International Corporation N.V.

-16.72%

Murata Manufacturing Company Ltd.

-15.04%

Ferrari N.V.

-9.78%

 

During the first half of 2021, no positions were eliminated, while the fund initiated new positions in Teleperformance (Business Services), Karooooo Ltd. (Business Services), Rubis SCA (Energy), and eDreams ODIGEO S.A. - ADR (Consumer Discretionary)

 

Thank you for being a shareholder in the Ave Maria World Equity Fund.

 

Anthony W. Gennaro Jr. CFA, CPA

Portfolio Manager

 

Past performance is no guarantee of future results. Current and future portfolio holdings are subject to risk.

 

22

 

 

 

AVE MARIA WORLD EQUITY FUND

Ten Largest Holdings

June 30, 2021 (Unaudited)

 

 

 

Shares

 

 

Company

 

Market Value

   

% of Net Assets

 
    15,800    

Microsoft Corporation

  $ 4,280,220       5.4 %
    16,340    

IQVIA Holdings, Inc.

    3,959,509       5.0 %
    10,000    

Mastercard, Inc. - Class A

    3,650,900       4.6 %
    59,000    

Coca-Cola European Partners plc

    3,499,800       4.4 %
    10,500    

Accenture plc - Class A

    3,095,295       3.9 %
    24,119    

Medtronic plc

    2,993,892       3.8 %
    6,400    

S&P Global, Inc.

    2,626,880       3.3 %
    13,300    

Lowe’s Companies, Inc.

    2,579,801       3.2 %
    15,705    

Pioneer Natural Resources Company

    2,552,377       3.2 %
    21,000    

Taiwan Semiconductor Manufacturing Company Ltd. - ADR

    2,523,360       3.2 %

 

Asset Allocation (Unaudited)

 

 

 

 

% of Net Assets

 

COMMON STOCKS

       

Sector

       

Communications

    4.1 %

Consumer Discretionary

    5.0 %

Consumer Staples

    6.6 %

Energy

    6.0 %

Financials

    18.3 %

Health Care

    14.1 %

Industrials

    10.1 %

Real Estate

    2.9 %

Technology

    32.0 %
         

MONEY MARKET FUNDS, LIABILITIES IN EXCESS OF OTHER ASSETS

    0.9 %
      100.0 %

 

23

 

 

 

AVE MARIA WORLD EQUITY FUND

Schedule of Investments

June 30, 2021 (Unaudited)

COMMON STOCKS — 99.1%

 

Shares

   

Market Value

 

Communications — 4.1%

               

Entertainment Content — 2.2%

               

Electronic Arts, Inc.

    12,000     $ 1,725,960  
                 

Internet Media & Services — 1.9%

               

eDreams ODIEGO S.A. - ADR *

    19,160       1,542,815  
                 

Consumer Discretionary — 5.0%

               

Automotive — 1.8%

               

Cie Générale des Établissements Michelin - ADR

    18,500       591,258  

Ferrari N.V.

    4,000       824,200  
              1,415,458  

Retail - Discretionary — 3.2%

               

Lowe’s Companies, Inc.

    13,300       2,579,801  
                 

Consumer Staples — 6.6%

               

Beverages — 4.4%

               

Coca-Cola European Partners plc

    59,000       3,499,880  
                 

Food — 2.2%

               

Mondelēz International, Inc. - Class A

    27,500       1,717,100  
                 

Energy — 6.0%

               

Oil & Gas Producers — 6.0%

               

Chevron Corporation

    13,100       1,372,094  

Pioneer Natural Resources Company

    15,705       2,552,377  

Rubis SCA

    19,600       872,226  
              4,796,697  

Financials — 18.3%

               

Banking — 4.0%

               

First Horizon National Corporation

    105,000       1,814,400  

Truist Financial Corporation

    24,500       1,359,750  
              3,174,150  

Diversified Financial Services — 3.3%

               

S&P Global, Inc.

    6,400       2,626,880  
                 

Insurance — 8.8%

               

AXA S.A. - ADR

    92,600       2,356,670  

Chubb Ltd.

    15,500       2,463,570  

Willis Towers Watson plc

    9,500       2,185,190  
              7,005,430  

 

 

24

 

 

 

AVE MARIA WORLD EQUITY FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 99.1% (Continued)

 

Shares

   

Market Value

 

Financials — 18.3% (Continued)

               

Specialty Finance — 2.2%

               

Fidelity National Financial, Inc.

    39,500     $ 1,716,670  
                 

Health Care — 14.1%

               

Health Care Facilities & Services — 5.0%

               

IQVIA Holdings, Inc. *

    16,340       3,959,509  
                 

Medical Equipment & Devices — 9.1%

               

Alcon, Inc.

    25,500       1,791,630  

Koninklijke Philips N.V.

    50,099       2,489,920  

Medtronic plc

    24,119       2,993,892  
              7,275,442  

Industrials — 10.1%

               

Aerospace & Defense — 1.9%

               

Lockheed Martin Corporation

    4,000       1,513,400  
                 

Capital Goods — 1.4%

               

Nidec Corporation - ADR

    38,600       1,115,540  
                 

Diversified Industrials — 1.5%

               

Eaton Corporation plc

    7,700       1,140,986  
                 

Electrical Equipment — 3.0%

               

Otis Worldwide Corporation

    12,000       981,240  

TE Connectivity Ltd.

    10,500       1,419,705  
              2,400,945  

Machinery — 1.0%

               

ITOCHU Corporation - ADR

    14,000       805,420  
                 

Transportation & Logistics — 1.3%

               

Canadian National Railway Company

    10,000       1,055,200  
                 

Real Estate — 2.9%

               

Real Estate Services — 1.6%

               

FirstService Corporation

    7,500       1,284,450  
                 

REITs — 1.3%

               

Equinix, Inc.

    1,300       1,043,380  

 

 

25

 

 

 

AVE MARIA WORLD EQUITY FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 99.1% (Continued)

 

Shares

   

Market Value

 

Technology — 32.0%

               

Semiconductors — 5.3%

               

Taiwan Semiconductor Manufacturing Company Ltd. - ADR

    21,000     $ 2,523,360  

Texas Instruments, Inc.

    8,500       1,634,550  
              4,157,910  

Software — 12.2%

               

Adobe, Inc. *

    2,800       1,639,792  

Karooooo Ltd. *

    21,279       781,365  

Microsoft Corporation

    15,800       4,280,220  

SAP SE - ADR

    16,500       2,317,590  

Sapiens International Corporation N.V.

    26,352       692,267  
              9,711,234  

Technology Hardware — 1.7%

               

Murata Manufacturing Company Ltd. - ADR

    71,500       1,367,080  
                 

Technology Services — 12.8%

               

Accenture plc - Class A

    10,500       3,095,295  

Mastercard, Inc. - Class A

    10,000       3,650,900  

Teleperformance - ADR

    8,111       1,649,169  

Visa, Inc. - Class A

    7,500       1,753,650  
              10,149,014  
                 

Total Common Stocks (Cost $54,075,733)

          $ 78,780,351  

 

MONEY MARKET FUNDS — 1.4%

 

Shares

   

Market Value

 

Federated Hermes Government Obligations Tax-Managed Fund - Institutional Shares, 0.01% (a) (Cost $1,118,879)

    1,118,879     $ 1,118,879  
                 

Total Investments at Market Value — 100.5% (Cost $55,194,612)

          $ 79,899,230  
                 

Liabilities in Excess of Other Assets — (0.5%)

            (435,652 )
                 

Net Assets — 100.0%

          $ 79,463,578  

 

ADR - American Depositary Receipt.

*

Non-income producing security.

(a)

The rate shown is the 7-day effective yield as of June 30, 2021.

See notes to financial statements.

 

 

26

 

 

 

AVE MARIA WORLD EQUITY FUND

Summary of Common Stocks by Country

June 30, 2021 (Unaudited)

Country

 

Value

   

% of Net Assets

 

United States **

  $ 48,114,366       60.5 %

United Kingdom

    5,685,070       7.1 %

France

    5,469,323       6.9 %

Switzerland

    4,255,200       5.4 %

Netherlands

    3,314,120       4.2 %

Japan

    3,288,040       4.1 %

Taiwan

    2,523,360       3.2 %

Canada

    2,339,650       2.9 %

Germany

    2,317,590       2.9 %

Singapore

    781,365       1.0 %

Cayman Islands

    692,267       0.9 %
    $ 78,780,351       99.1 %

 

**

Includes companies deemed to be a “non-U.S. company” as defined in the Fund’s prospectus, if a company is headquartered outside the United States, or has at least 50% of its revenues or operations outside the United States during its most recent fiscal year, at the time of purchase.

See notes to financial statements.

 

 

27

 

 

 

Ave Maria Focused Fund

Portfolio Manager Commentary

(Unaudited)

 

 

Dear Fellow Shareholders,

 

The Ave Maria Focused Fund (AVEAX) (the “Fund”) commenced operations on May 1, 2020. In the first half of 2021, the Fund was up 17.06%, compared to 15.25% for the benchmark S&P 500 Index (the “Benchmark”). For the 1-Year time period, the Fund was up 37.33%, compared to 40.79% for the Benchmark.

 

 

YTD

1 Year

Since
Inception

Ave Maria Focused Fund

17.06%

37.33%

38.39%

S&P 500 Index

15.25%

40.79%

45.51%

 

A Brief Note on Performance

 

The year began with the Fund almost fully deployed into companies that exemplified the guiding principles of the Fund, which are to purchase companies with durable, forecastable, and growing earnings; the ability to earn a high return on incremental invested capital; a long runway for redeployment of capital within existing businesses; and operated by strong and ethical management teams. The investment theses for several of our companies are beginning to play out, hence the strong year-to-date performance. Our strongest performer in the period was Texas Pacific Land Corporation (+121.0%), followed by eDreams (+63.4%), which benefited by a business model transition and the initial re-opening of European leisure travel. Two other companies in the portfolio generated returns greater than 40%. Five companies generated returns over 20%. Only four companies in the period generated negative returns. Cash drag during 2020 caused the since inception returns to lag the Benchmark as it took time to fully deploy the Fund and build a portfolio of high-quality companies. If the Fund continues its outperformance, then we expect that the cash drag from 2020 will be diminished in future calculations of performance since inception.

 

An Interesting Investment Theme – Business Model Transitions

 

If a company can transition to a superior business model, its valuation will generally increase to reflect its success. These transitions can be opportunities to generate extraordinary returns. Of the 24 companies in the Fund’s portfolio, 11 are in some form of business model transition. Our software holdings – Adobe, Autodesk, Microsoft, and Tyler Technologies – are at various stages of shifting from a licensing model to a Software as a Service model. APi Group transitions acquired companies from a project-first business model to service- first model. eDreams is transitioning from a transaction-based model to a subscription model, and it is the first company in the travel industry to make this switch. Frontdoor is transforming from a specialty insurance company to a

 

28

 

 

 

AVE MARIA FOCUSED FUND
PORTFOLIO MANAGER COMMENTARY
(Unaudited) (Continued)

 

 

home repair service technology company. Hermes is completing its shift away from outside concessionaires to selling directly to customers. In addition to collecting royalty checks on oil and selling land, Texas Pacific is becoming a leading oilfield services company. Valvoline is shifting from a branded consumer products company to a leading retailer. Finally, Green Plains is changing from a producer of commodity products to a producer of high-value animal feed ingredients.

 

New Investments:

 

 

Green Plains produces ethanol, animal feed ingredients, corn oil, specialty alcohols and other products. Green Plains’ legacy business has structural attributes that we would rather avoid, such as exposure to cyclical markets, commoditized products, and low returns on capital. However, Green Plains recently acquired a transformative technology company, Fluid Quip. The acquisition will allow Green Plains to transition to the production of valuable high-protein feed ingredients, as well as industrial and specialty sugars. Furthermore, the company can sequester the carbon produced in its corn milling operations, which can allow it to capture a premium price for its ethanol sold into states with Low Carbon Fuel Standards (LCFS) and allow it to collect federal 45Q tax credits. Consequently, Green Plains’ free cash flow should materially increase, and the Fund should benefit from both a growth in earnings and an expansion of its valuation multiple.

 

 

Archaea Energy is the combination of Archaea Energy and Aria Energy, which are going public through a merger with the Special Purpose Acquisition Corporation (Rice Acquisition Corp.) formed by the Rice family – a family with a history of creating shareholder wealth via public companies. The companies collect renewable natural gas, primarily from landfills, process it, and either convert it into electricity or sell it for distribution in a natural gas pipeline. As with Green Plains, Archaea benefits from LCFS credits and 45Q tax credits. The Fund has substantial investments in two waste companies. Both companies are focused on collecting gas from their landfills and view gas collection infrastructure investments as highly attractive.

 

29

 

 

 

AVE MARIA FOCUSED FUND
PORTFOLIO MANAGER COMMENTARY
(Unaudited) (Continued)

 

 

Other Portfolio Changes:

 

Positions in three companies were reduced during the period. Two reductions were to manage portfolio concentration. One reduction was to re-deploy capital into better opportunities. We fully exited the position in Software AG and SBA Communications.

 

We made additions to eight holdings: API Group, Brookfield Asset Management, Chemed, eDreams, GFL, Environmental, S&P Global, and Texas Pacific Land Corp.

 

Top Ten Positions:

 

Top Ten Positions in the Portfolio as of June 30, 2021

 

   

Company

Portfolio
Weight

1.

 

eDreams ODIGEO

12.6%

2.

 

APi Group

8.9%

3.

 

GFL Environmental

8.3%

4.

 

Microsoft

7.4%

5.

 

Equinix

6.1%

6.

 

Frontdoor

5.4%

7.

 

Green Plains

4.7%

8.

 

Adobe

4.6%

9.

 

Valvoline

4.0%

10.

 

Visa

3.2%

 

Thank you for partnering with us. Your investment in the Ave Maria Focused Fund is appreciated.

 

With best regards,

 

Chadd M. Garcia, CFA

Adam P. Gaglio, CFA

Lead Portfolio Manager

Co-Portfolio Manager

 

Past performance is no guarantee of future results. Current and future portfolio holdings are subject to risk.

 

30

 

 

 

AVE MARIA FOCUSED FUND

Ten Largest Holdings

June 30, 2021 (Unaudited)

 

 

 

Shares

 

 

Company

 

Market Value

   

% of Net Assets

 
    78,812    

eDreams ODIEGO S.A. - ADR

  $ 6,346,155       12.6 %
    213,959    

API Group Corporation

    4,469,604       8.9 %
    130,271    

GFL Environmental, Inc.

    4,158,250       8.3 %
    13,731    

Microsoft Corporation

    3,719,728       7.4 %
    3,830    

Equinix, Inc.

    3,073,958       6.1 %
    54,176    

frontdoor, inc.

    2,699,048       5.4 %
    69,750    

Green Plains, Inc.

    2,344,995       4.7 %
    3,936    

Adobe, Inc.

    2,305,079       4.6 %
    62,367    

Valvoline, Inc.

    2,024,433       4.0 %
    6,945    

Visa, Inc. - Class A

    1,623,880       3.2 %

 

Asset Allocation (Unaudited)

 

 

 

 

% of Net Assets

 

COMMON STOCKS

       

Sector

       

Communications

    12.6 %

Consumer Discretionary

    4.4 %

Energy

    4.7 %

Financials

    7.0 %

Health Care

    3.1 %

Industrials

    24.8 %

Materials

    4.0 %

Real Estate

    9.0 %

Technology

    25.5 %
         

MONEY MARKET FUNDS, OTHER ASSETS IN EXCESS OF LIABILITIES

    4.9 %
      100.0 %

 

31

 

 

 

AVE MARIA FOCUSED FUND

Schedule of Investments

June 30, 2021 (Unaudited)

COMMON STOCKS — 95.1%

 

Shares

   

Market Value

 

Communications — 12.6%

               

Internet Media & Services — 12.6%

               

eDreams ODIEGO S.A. - ADR *

    78,812     $ 6,346,155  
                 

Consumer Discretionary — 4.4%

               

Apparel & Textile Products — 2.7%

               

Hermes International - ADR

    9,183       1,340,535  
                 

Automotive — 1.7%

               

Ferrari N.V.

    4,284       882,718  
                 

Energy — 4.7%

               

Renewable Energy — 4.7%

               

Green Plains, Inc. *

    69,750       2,344,995  
                 

Financials — 7.0%

               

Asset Management — 4.4%

               

Brookfield Asset Management Reinsurance Partners Ltd. - Class A *

    184       9,560  

Brookfield Asset Management, Inc. - Class A

    26,647       1,358,464  

Rice Acquisition Corporation - Class A *

    46,225       834,361  
              2,202,385  

Diversified Financial Services — 2.6%

               

S&P Global, Inc.

    3,278       1,345,455  
                 

Health Care — 3.1%

               

Health Care Facilities & Services — 3.1%

               

Chemed Corporation

    3,321       1,575,814  
                 

Industrials — 24.8%

               

Commercial Support Services — 10.5%

               

GFL Environmental, Inc.

    130,271       4,158,250  

Waste Connections, Inc.

    9,644       1,151,783  
              5,310,033  

Electrical Equipment — 8.9%

               

API Group Corporation *

    213,959       4,469,604  
                 

Engineering & Construction — 5.4%

               

frontdoor, inc. *

    54,176       2,699,048  
                 

Materials — 4.0%

               

Chemicals — 4.0%

               

Valvoline, Inc.

    62,367       2,024,433  

 

 

32

 

 

 

AVE MARIA FOCUSED FUND

SCHEDULE OF INVESTMENTS

(Continued)

COMMON STOCKS — 95.1% (Continued)

 

Shares

   

Market Value

 

Real Estate — 9.0%

               

Real Estate Owners & Developers — 2.9%

               

Texas Pacific Land Corporation

    925     $ 1,479,760  
                 

REITs — 6.1%

               

Equinix, Inc.

    3,830       3,073,958  
                 

Technology — 25.5%

               

Software — 17.2%

               

Adobe, Inc. *

    3,936       2,305,079  

Autodesk, Inc. *

    3,465       1,011,433  

Change Healthcare, Inc. *

    13,000       299,520  

Microsoft Corporation

    13,731       3,719,728  

Tyler Technologies, Inc. *

    2,946       1,332,682  
              8,668,442  

Technology Services — 8.3%

               

Mastercard, Inc. - Class A

    4,163       1,519,870  

Moody’s Corporation

    2,831       1,025,869  

Visa, Inc. - Class A

    6,945       1,623,880  
              4,169,619  
                 

Total Common Stocks (Cost $36,502,586)

          $ 47,932,954  

 

MONEY MARKET FUNDS — 3.0%

 

Shares

   

Market Value

 

Federated Hermes Government Obligations Tax-Managed Fund - Institutional Shares, 0.01% (a) (Cost $1,514,258)

    1,514,258     $ 1,514,258  
                 

Total Investments at Market Value — 98.1% (Cost $38,016,844)

          $ 49,447,212  
                 

Other Assets in Excess of Liabilities — 1.9%

            950,220  
                 

Net Assets — 100.0%

          $ 50,397,432  

 

ADR - American Depositary Receipt.

*

Non-income producing security.

(a)

The rate shown is the 7-day effective yield as of June 30, 2021.

See notes to financial statements.

 

 

33

 

 

 

Ave Maria Bond Fund

Portfolio Manager Commentary

(Unaudited)

 

 

Dear Fellow Shareholders,

 

For the six months ended June 30, 2021, the total return of the Ave Maria Bond Fund (the “Fund”) was 4.68%, compared to the Bloomberg Barclays Intermediate U.S. Government/ Credit Index at -0.90%. The Fund’s combination of short-maturity bonds and dividend-paying common stocks were the primary drivers of performance during the first half of the year.

 

Interest rates spiked during the first quarter as the 10-year U.S. Treasury went from 0.9% to 1.7%. The second quarter was less eventful as the 10-year yield slipped to 1.4% by quarter end. The bond market has full faith in the Federal Reserve (the Fed), as interest rates decreased across the yield curve and inflation readings came in higher than expected. The Fed has deemed the recent inflation spike as “transitory” and believes inflation will be back around the Fed’s 2% target later this year. Regardless, with the 10-year at 1.4%, investors are earning a negative return after inflation, and in fact, the same goes for investors willing to purchase the 30-year Treasuries, which yield slightly over 2%.

 

Corporate credit spreads are touching multi-decade lows as investors continue to search for yield. It is in this environment the Fund remains invested in high-quality, short-maturity US Treasury and corporate bonds, as investors are currently not being adequately compensated for interest rate and credit risk.

 

In reviewing the performance of the Fund during the first half of 2021, the three top-performing assets were the common stocks of Texas Pacific Land Corp., (royalty income – oil and gas), First Horizon Corp. (regional bank) and Watsco, Inc. (industrial distributor). During the period, the Fund’s weakest-performing assets were intermediate - maturity corporate bonds.

 

34

 

 

 

AVE MARIA BOND FUND
PORTFOLIO MANAGER COMMENTARY
(Unaudited) (Continued)

 

 

From an historical perspective, interest rates and corporate credit spreads are currently low. Therefore, the Fund will to be managed in a conservative manner. Average bond maturity will be kept short and credit quality high. Despite the runup in equity prices, dividend-paying common stocks continue to offer an attractive combination of current income and potential price appreciation.

 

We appreciate your investment in the Ave Maria Bond Fund.

 

Brandon S. Scheitler, VP

George P. Schwartz, CFA

Lead Portfolio Manager

Co-Portfolio Manager

 

Past performance is no guarantee of future results. Current and future portfolio holdings are subject to risk.

 

35

 

 

 

AVE MARIA BOND FUND

Ten Largest Holdings*

June 30, 2021 (Unaudited)

 

 

 

Par Value/
Shares

 

 

Holding

 

Market Value

   

% of Net Assets

 
  $ 10,585,700    

U.S. Treasury Inflation-Protected Notes, 0.500%, due 04/15/24

  $ 11,409,538       2.5 %
  $ 10,601,000    

Illinois Tool Works, Inc., 2.650%, due 11/15/26

    11,376,096       2.5 %
  $ 10,000,000    

U.S. Treasury Notes, 2.875%, due 11/30/23

    10,611,328       2.3 %
  $ 10,000,000    

U.S. Treasury Notes, 2.125%, due 11/30/24

    10,533,984       2.3 %
  $ 10,000,000    

U.S. Treasury Notes, 1.625%, due 08/31/22

    10,175,000       2.2 %
  $ 10,000,000    

U.S. Treasury Notes, 0.375%, due 04/15/24

    9,987,500       2.2 %
  $ 10,000,000    

U.S. Treasury Notes, 0.500%, due 03/31/25

    9,952,734       2.2 %
    5,400    

Texas Pacific Land Corporation

    8,638,596       1.9 %
  $ 7,375,000    

BlackRock, Inc., 3.200%, due 03/15/27

    8,180,748       1.8 %
  $ 7,094,230    

U.S. Treasury Inflation-Protected Notes, 0.375%, due 07/15/27

    7,913,207       1.7 %

 

*

Excludes cash equivalents.

 

Asset Allocation (Unaudited)

 

 

 

 

% of Net Assets

 

U.S. GOVERNMENT & AGENCIES

    24.8 %
         

CORPORATE BONDS

       

Sector

       

Communications

    1.4 %

Consumer Discretionary

    6.5 %

Consumer Staples

    7.0 %

Energy

    3.6 %

Financials

    5.2 %

Health Care

    4.4 %

Industrials

    7.6 %

Materials

    2.6 %

Technology

    12.1 %
         

COMMON STOCKS

       

Sector

       

Consumer Discretionary

    2.5 %

Consumer Staples

    1.3 %

Energy

    1.3 %

Financials

    4.5 %

Health Care

    1.1 %

Industrials

    3.9 %

Real Estate

    1.9 %

Technology

    3.1 %
         

MONEY MARKET FUNDS, OTHER ASSETS IN EXCESS OF LIABILITIES

    5.2 %
      100.0 %

 

36

 

 

 

AVE MARIA BOND FUND

Schedule of Investments

June 30, 2021 (Unaudited)

U.S. GOVERNMENT & AGENCIES — 24.8%

 

Par Value

   

Market Value

 

U.S. Treasury Bonds — 0.6%

               

8.000%, due 11/15/21

  $ 2,500,000     $ 2,573,828  
                 

U.S. Treasury Inflation-Protected Notes — 11.2% (a)

               

0.625%, due 04/15/23

    1,504,776       1,591,741  

0.500%, due 04/15/24

    10,585,700       11,409,538  

2.375%, due 01/15/25

    4,249,110       4,937,931  

0.625%, due 01/15/26

    5,618,050       6,239,401  

2.000%, due 01/15/26

    4,035,450       4,748,117  

0.375%, due 01/15/27

    4,310,436       4,771,619  

0.375%, due 07/15/27

    7,094,230       7,913,207  

0.500%, due 01/15/28

    5,411,800       6,069,531  

0.750%, due 07/15/28

    2,659,000       3,052,241  
              50,733,326  

U.S. Treasury Notes — 13.0%

               

1.875%, due 07/31/22

    2,500,000       2,547,656  

1.625%, due 08/31/22

    10,000,000       10,175,000  

2.875%, due 11/30/23

    10,000,000       10,611,328  

0.375%, due 04/15/24

    10,000,000       9,987,500  

2.125%, due 11/30/24

    10,000,000       10,533,984  

0.500%, due 03/31/25

    10,000,000       9,952,734  

0.125%, due 04/15/26

    5,090,200       5,537,979  
              59,346,181  

Total U.S. Government & Agencies (Cost $111,774,709)

          $ 112,653,335  

 

CORPORATE BONDS — 50.4%

 

Par Value

   

Market Value

 

Communications — 1.4%

               

Electronic Arts, Inc., 4.800%, due 03/01/26

  $ 5,500,000     $ 6,340,499  
                 

Consumer Discretionary — 6.5%

               

Lowe’s Companies, Inc., 3.800%, due 11/15/21

    1,000,000       1,004,264  

Lowe’s Companies, Inc., 3.120%, due 04/15/22

    3,000,000       3,045,544  

Lowe’s Companies, Inc., 3.125%, due 09/15/24

    800,000       857,046  

Lowe’s Companies, Inc., 3.375%, due 09/15/25

    1,500,000       1,644,503  

Lowe’s Companies, Inc., 2.500%, due 04/15/26

    3,000,000       3,183,819  

Lowe’s Companies, Inc., 3.100%, due 05/03/27

    5,000,000       5,453,047  

Ross Stores, Inc., 3.375%, due 09/15/24

    3,000,000       3,179,759  

Ross Stores, Inc., 0.875%, due 04/15/26

    1,700,000       1,664,962  

TJX Companies, Inc. (The), 2.500%, due 05/15/23

    2,000,000       2,069,585  

TJX Companies, Inc. (The), 2.250%, due 09/15/26

    3,426,000       3,604,630  

TJX Companies, Inc. (The), 1.150%, due 05/15/28

    2,000,000       1,938,267  

 

 

37

 

 

 

AVE MARIA BOND FUND
SCHEDULE OF INVESTMENTS
(Continued)

CORPORATE BONDS — 50.4% (Continued)

 

Par Value

   

Market Value

 

Consumer Discretionary — 6.5% (Continued)

               

VF Corporation, 2.400%, due 04/23/25

  $ 650,000     $ 681,841  

VF Corporation, 2.800%, due 04/23/27

    1,200,000       1,281,944  
              29,609,211  

Consumer Staples — 7.0%

               

Coca-Cola Company (The), 1.450%, due 06/01/27

    2,500,000       2,525,765  

Coca-Cola Company (The), 1.000%, due 03/15/28

    1,000,000       970,163  

Colgate-Palmolive Company, 2.250%, due 11/15/22

    500,000       513,295  

Colgate-Palmolive Company, 1.950%, due 02/01/23

    2,663,000       2,735,260  

Colgate-Palmolive Company, 3.250%, due 03/15/24

    795,000       853,725  

Hershey Company (The), 2.625%, due 05/01/23

    4,536,000       4,696,466  

Hershey Company (The), 3.375%, due 05/15/23

    500,000       526,465  

Hershey Company (The), 2.050%, due 11/15/24

    3,200,000       3,338,010  

Hershey Company (The), 2.300%, due 08/15/26

    1,500,000       1,593,849  

J.M. Smucker Company (The), 3.500%, due 10/15/21

    2,000,000       2,019,497  

Kimberly-Clark Corporation, 2.400%, due 03/01/22

    3,811,000       3,866,298  

Kimberly-Clark Corporation, 2.400%, due 06/01/23

    440,000       456,756  

Kimberly-Clark Corporation, 2.650%, due 03/01/25

    1,115,000       1,184,627  

Kimberly-Clark Corporation, 2.750%, due 02/15/26

    343,000       372,432  

Kimberly-Clark Corporation, 1.050%, due 09/15/27

    1,000,000       979,564  

McCormick & Company, Inc., 3.900%, due 07/15/21

    2,500,000       2,503,325  

McCormick & Company, Inc., 3.500%, due 09/01/23

    2,500,000       2,637,770  
              31,773,267  

Energy — 3.6%

               

Chevron Corporation, 2.895%, due 03/03/24

    1,824,000       1,930,925  

Chevron Corporation, 2.954%, due 05/16/26

    1,450,000       1,572,811  

Chevron Corporation, 1.995%, due 05/11/27

    5,085,000       5,248,722  

Exxon Mobil Corporation, 2.397%, due 03/06/22

    2,000,000       2,022,498  

Exxon Mobil Corporation, 3.176%, due 03/15/24

    1,634,000       1,740,501  

Exxon Mobil Corporation, 2.019%, due 08/16/24

    2,650,000       2,760,836  

Exxon Mobil Corporation, 2.709%, due 03/06/25

    998,000       1,061,555  
              16,337,848  

Financials — 5.2%

               

BlackRock, Inc., 3.500%, due 03/18/24

    2,500,000       2,700,899  

BlackRock, Inc., 3.200%, due 03/15/27

    7,375,000       8,180,748  

Chubb INA Holdings, Inc., 3.150%, due 03/15/25

    4,309,000       4,659,308  

Chubb INA Holdings, Inc., 3.350%, due 05/03/26

    500,000       549,617  

PNC Financial Services Group, Inc. (The), 3.250%, due 06/01/25

    1,528,000       1,662,418  

PNC Financial Services Group, Inc. (The), 3.250%, due 01/22/28

    4,380,000       4,839,957  

U.S. Bancorp, 3.375%, due 02/05/24

    1,000,000       1,071,046  
              23,663,993  

 

 

38

 

 

 

AVE MARIA BOND FUND
SCHEDULE OF INVESTMENTS
(Continued)

CORPORATE BONDS — 50.4% (Continued)

 

Par Value

   

Market Value

 

Health Care — 4.4%

               

Medtronic, Inc., 3.500%, due 03/15/25

  $ 5,598,000     $ 6,147,976  

Stryker Corporation, 3.375%, due 05/15/24

    5,500,000       5,896,226  

Stryker Corporation, 3.375%, due 11/01/25

    1,026,000       1,120,826  

Stryker Corporation, 3.500%, due 03/15/26

    2,468,000       2,721,682  

Zimmer Biomet Holdings, Inc., 3.550%, due 04/01/25

    3,955,000       4,292,162  
              20,178,872  

Industrials — 7.6%

               

3M Company, 2.000%, due 06/26/22

    1,073,000       1,092,138  

3M Company, 2.250%, due 03/15/23

    3,000,000       3,092,935  

Illinois Tool Works, Inc., 3.500%, due 03/01/24

    2,450,000       2,623,700  

Illinois Tool Works, Inc., 2.650%, due 11/15/26

    10,601,000       11,376,096  

PACCAR Financial Corporation, 1.650%, due 08/11/21

    3,750,000       3,756,101  

Snap-on, Inc., 6.125%, due 09/01/21

    2,000,000       2,017,080  

United Parcel Service, Inc., 2.350%, due 05/16/22

    2,990,000       3,040,375  

United Parcel Service, Inc., 2.200%, due 09/01/24

    3,410,000       3,573,455  

United Parcel Service, Inc., 2.800%, due 11/15/24

    1,000,000       1,067,212  

United Parcel Service, Inc., 2.400%, due 11/15/26

    2,869,000       3,053,256  
              34,692,348  

Materials — 2.6%

               

Ecolab, Inc., 2.375%, due 08/10/22

    415,000       423,651  

Ecolab, Inc., 3.250%, due 01/14/23

    5,000,000       5,206,975  

Ecolab, Inc., 2.700%, due 11/01/26

    5,638,000       6,042,648  
              11,673,274  

Technology — 12.1%

               

Cisco Systems, Inc., 2.600%, due 02/28/23

    2,475,000       2,570,166  

Cisco Systems, Inc., 3.625%, due 03/04/24

    3,500,000       3,786,426  

Cisco Systems, Inc., 2.950%, due 02/28/26

    1,000,000       1,086,724  

Cisco Systems, Inc., 2.500%, due 09/20/26

    3,080,000       3,306,172  

Mastercard, Inc., 3.375%, due 04/01/24

    3,855,000       4,157,867  

Mastercard, Inc., 2.000%, due 03/03/25

    5,625,000       5,882,831  

Mastercard, Inc., 2.950%, due 11/21/26

    2,000,000       2,183,911  

Mastercard, Inc., 3.300%, due 03/26/27

    5,199,000       5,753,625  

Mastercard, Inc., 3.500%, due 02/26/28

    450,000       505,820  

Moody’s Corporation, 4.500%, due 09/01/22

    1,000,000       1,037,898  

Moody’s Corporation, 2.625%, due 01/15/23

    3,319,000       3,425,926  

Moody’s Corporation, 4.875%, due 02/15/24

    1,500,000       1,647,947  

Moody’s Corporation, 3.250%, due 01/15/28

    3,550,000       3,893,479  

Texas Instruments, Inc., 2.250%, due 05/01/23

    2,500,000       2,569,643  

Texas Instruments, Inc., 1.375%, due 03/12/25

    1,160,000       1,184,650  

Texas Instruments, Inc., 2.900%, due 11/03/27

    740,000       807,129  

Texas Instruments, Inc., 2.250%, due 09/04/29

    1,112,000       1,159,348  

 

 

39

 

 

 

AVE MARIA BOND FUND
SCHEDULE OF INVESTMENTS
(Continued)

CORPORATE BONDS — 50.4% (Continued)

 

Par Value

   

Market Value

 

Technology — 12.1% (Continued)

               

Visa, Inc., 2.150%, due 09/15/22

  $ 4,000,000     $ 4,086,744  

Visa, Inc., 3.150%, due 12/14/25

    3,905,000       4,273,644  

Visa, Inc., 1.900%, due 04/15/27

    354,000       365,765  

Visa, Inc., 2.750%, due 09/15/27

    1,150,000       1,243,861  
              54,929,576  
                 

Total Corporate Bonds (Cost $223,603,735)

          $ 229,198,888  

 

COMMON STOCKS — 19.6%

 

Shares

   

Market Value

 

Consumer Discretionary — 2.5%

               

Apparel & Textile Products — 1.1%

               

VF Corporation

    60,000     $ 4,922,400  
                 

Retail - Discretionary — 1.4%

               

Genuine Parts Company

    49,300       6,234,971  
                 

Consumer Staples — 1.3%

               

Beverages — 1.3%

               

Coca-Cola European Partners plc

    100,000       5,932,000  
                 

Energy — 1.3%

               

Oil & Gas Producers — 1.3%

               

Chevron Corporation

    58,000       6,074,920  
                 

Financials — 4.5%

               

Asset Management — 1.3%

               

BlackRock, Inc.

    7,000       6,124,790  
                 

Banking — 2.3%

               

First Horizon National Corporation

    366,000       6,324,480  

Truist Financial Corporation

    77,000       4,273,500  
              10,597,980  

Specialty Finance — 0.9%

               

Fidelity National Financial, Inc.

    90,000       3,911,400  
                 

Health Care — 1.1%

               

Medical Equipment & Devices — 1.1%

               

Medtronic plc

    40,000       4,965,200  

 

 

40

 

 

 

AVE MARIA BOND FUND
SCHEDULE OF INVESTMENTS
(Continued)

COMMON STOCKS — 19.6% (Continued)

 

Shares

   

Market Value

 

Industrials — 3.9%

               

Industrial Support Services — 2.7%

               

Fastenal Company

    106,000     $ 5,512,000  

Watsco, Inc.

    24,000       6,879,360  
              12,391,360  

Transportation & Logistics — 1.2%

               

United Parcel Service, Inc. - Class B

    25,000       5,199,250  
                 

Real Estate — 1.9%

               

Real Estate Owners & Developers — 1.9%

               

Texas Pacific Land Corporation

    5,400       8,638,596  
                 

Technology — 3.1%

               

Semiconductors — 1.6%

               

Texas Instruments, Inc.

    37,000       7,115,100  
                 

Technology Services — 1.5%

               

Western Union Company (The)

    300,000       6,891,000  
                 

Total Common Stocks (Cost $55,587,822)

          $ 88,998,967  

 

MONEY MARKET FUNDS — 4.7%

 

Shares

   

Market Value

 

Federated Hermes Government Obligations Tax-Managed Fund - Institutional Shares, 0.01% (b) (Cost $21,175,025)

    21,175,025     $ 21,175,025  
                 

Total Investments at Market Value — 99.5% (Cost $412,141,291)

          $ 452,026,215  
                 

Other Assets in Excess of Liabilities — 0.5%

            2,395,856  
                 

Net Assets — 100.0%

          $ 454,422,071  

 

(a)

Interest rate for this investment is the stated rate. Interest payments are determined based on the inflation adjusted principal.

(b)

The rate shown is the 7-day effective yield as of June 30, 2021.

See notes to financial statements.

 

 

41

 

 

 

AVE MARIA MUTUAL FUNDS

Statements of Assets and Liabilities

June 30, 2021 (Unaudited)

 

 

Ave Maria
Value Fund

   

Ave Maria
Growth Fund

   

Ave Maria
Rising
Dividend Fund

 

ASSETS

                       

Investment securities:

                       

At cost

  $ 206,741,186     $ 574,312,734     $ 641,277,176  

At market value (Note 1)

  $ 311,954,936     $ 1,036,348,143     $ 954,011,999  

Cash

          78,731       44,201  

Receivable for capital shares sold

    138,813       333,766       675,615  

Dividends receivable

    76,553       327,502       1,264,208  

Tax reclaims receivable

    2,454       77,526       44,819  

Other assets

    22,832       40,584       38,385  

TOTAL ASSETS

    312,195,588       1,037,206,252       956,079,227  
                         

LIABILITIES

                       

Dividends payable

                222,150  

Payable for capital shares redeemed

    141,415       923,604       952,803  

Payable to Adviser (Note 2)

    599,195       1,890,114       1,770,731  

Payable to administrator (Note 2)

    25,427       83,468       78,024  

Other accrued expenses

    15,482       34,978       32,981  

TOTAL LIABILITIES

    781,519       2,932,164       3,056,689  
                         

NET ASSETS

  $ 311,414,069     $ 1,034,274,088     $ 953,022,538  
                         

NET ASSETS CONSIST OF:

                       

Paid-in capital

  $ 195,215,566     $ 517,584,047     $ 585,963,707  

Accumulated earnings

    116,198,503       516,690,041       367,058,831  

NET ASSETS

  $ 311,414,069     $ 1,034,274,088     $ 953,022,538  

Shares of beneficial interest outstanding (unlimited number of shares authorized, no par value)

    12,609,273       21,282,104       42,534,838  

Net asset value, offering price and redemption price per share (Note 1)

  $ 24.70     $ 48.60     $ 22.41  

 

See notes to financial statements.

 

 

42

 

 

 

AVE MARIA MUTUAL FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
June 30, 2021 (Unaudited) (Continued)

 

 

Ave Maria
World
Equity Fund

   

Ave Maria
Focused Fund

   

Ave Maria
Bond Fund

 

ASSETS

                       

Investment securities:

                       

At cost

  $ 55,194,612     $ 38,016,844     $ 412,141,291  

At market value (Note 1)

  $ 79,899,230     $ 49,447,212     $ 452,026,215  

Cash

    4,209       2,944        

Receivable for capital shares sold

    58,586       13,573       928,894  

Receivable for investment securities sold

    553,144       1,022,255        

Dividends and interest receivable

    87,302       6       2,087,036  

Tax reclaims receivable

    4,572              

Other assets

    19,380       16,769       29,898  

TOTAL ASSETS

    80,626,423       50,502,759       455,072,043  
                         

LIABILITIES

                       

Due to custodian

    298,655              

Dividends payable

                78,359  

Payable for capital shares redeemed

    78,608       231       216,591  

Payable for investment securities purchased

    589,463              

Payable to Adviser (Note 2)

    180,271       92,669       298,869  

Payable to administrator (Note 2)

    6,573       4,040       33,875  

Other accrued expenses

    9,275       8,387       22,278  

TOTAL LIABILITIES

    1,162,845       105,327       649,972  
                         

NET ASSETS

  $ 79,463,578     $ 50,397,432     $ 454,422,071  
                         

NET ASSETS CONSIST OF:

                       

Paid-in capital

  $ 56,093,089     $ 38,250,965     $ 409,410,686  

Accumulated earnings

    23,370,489       12,146,467       45,011,385  

NET ASSETS

  $ 79,463,578     $ 50,397,432     $ 454,422,071  

Shares of beneficial interest outstanding (unlimited number of shares authorized, no par value)

    4,453,040       3,463,700       36,476,922  

Net asset value, offering price and redemption price per share (Note 1)

  $ 17.84     $ 14.55     $ 12.46  

 

See notes to financial statements.

 

 

43

 

 

 

AVE MARIA MUTUAL FUNDS

Statements of Operations

For the Six Months Ended June 30, 2021 (Unaudited)

 

 

Ave Maria
Value Fund

   

Ave Maria
Growth Fund

   

Ave Maria
Rising
Dividend Fund

 

INVESTMENT INCOME

                       

Dividends

  $ 1,383,661     $ 4,585,040     $ 8,450,488  

Foreign withholding taxes on dividends

    (13,509 )     (190,793 )     (81,519 )

Interest

    280              

TOTAL INVESTMENT INCOME

    1,370,432       4,394,247       8,368,969  
                         

EXPENSES

                       

Investment advisory fees (Note 2)

    1,168,965       3,622,295       3,355,527  

Administration, accounting and transfer agent fees (Note 2)

    144,482       485,045       449,995  

Trustees’ fees and expenses (Note 2)

    19,652       68,689       63,608  

Postage and supplies

    22,976       49,674       46,244  

Registration and filing fees

    16,842       28,499       24,122  

Audit and tax services fees

    13,790       28,819       27,061  

Legal fees

    15,390       15,390       15,390  

Custodian and bank service fees

    8,922       28,530       26,566  

Advisory board fees and expenses (Note 2)

    4,493       16,341       15,525  

Insurance expense

    6,874       8,453       9,311  

Printing of shareholder reports

    5,903       10,967       9,680  

Compliance service fees and expenses (Note 2)

    2,190       7,212       6,716  

Other expenses

    11,606       23,660       22,285  

TOTAL EXPENSES

    1,442,085       4,393,574       4,072,030  
                         

NET INVESTMENT INCOME (LOSS)

    (71,653 )     673       4,296,939  
                         

REALIZED AND UNREALIZED GAINS ON INVESTMENTS

                       

Net realized gains from investment transactions

    11,056,406       54,653,959       54,165,019  

Net change in unrealized appreciation (depreciation) on investments

    44,837,710       70,940,918       76,300,519  

NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS

    55,894,116       125,594,877       130,465,538  
                         

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS

  $ 55,822,463     $ 125,595,550     $ 134,762,477  

 

See notes to financial statements.

 

 

44

 

 

 

AVE MARIA MUTUAL FUNDS
STATEMENTS OF OPERATIONS
For the Six Months Ended June 30, 2021 (Unaudited) (Continued)

 

 

Ave Maria
World
Equity Fund

   

Ave Maria
Focused Fund

   

Ave Maria
Bond Fund

 

INVESTMENT INCOME

                       

Dividends

  $ 763,726     $ 119,215     $ 1,119,129  

Foreign withholding taxes on dividends

    (66,182 )     (5,738 )      

Interest

                3,230,556  

TOTAL INVESTMENT INCOME

    697,544       113,477       4,349,685  
                         

EXPENSES

                       

Investment advisory fees (Note 2)

    351,160       173,518       609,494  

Administration, accounting and transfer agent fees (Note 2)

    37,191       20,550       195,318  

Trustees’ fees and expenses (Note 2)

    5,210       2,767       30,990  

Postage and supplies

    8,531       3,677       18,993  

Registration and filing fees

    16,105       20,900       24,240  

Audit and tax services fees

    9,044       8,419       16,743  

Legal fees

    15,390       15,391       15,391  

Custodian and bank service fees

    2,810       1,649       13,301  

Advisory board fees and expenses (Note 2)

    509       723       7,077  

Insurance expense

    3,724       2,364       6,983  

Printing of shareholder reports

    2,073       818       4,526  

Compliance service fees and expenses (Note 2)

    552       325       3,240  

Other expenses

    8,896       8,154       22,119  

TOTAL EXPENSES

    461,195       259,255       968,415  

Less fee reductions by the Adviser (Note 2)

          (4,081 )      

Previous investment advisory fee reductions recouped by the Adviser (Note 2)

    858              

NET EXPENSES

    462,053       255,174       968,415  
                         

NET INVESTMENT INCOME (LOSS)

    235,491       (141,697 )     3,381,270  
                         

REALIZED AND UNREALIZED GAINS ON INVESTMENTS

                       

Net realized gains from investment transactions

    1,816,544       890,900       4,936,211  

Net realized gains from foreign currency transactions (Note 1)

    1,699              

Net change in unrealized appreciation (depreciation) on investments

    6,341,913       5,984,337       11,096,857  

Net change in unrealized appreciation (depreciation) on foreign currency translation

    1,162              

NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS

    8,161,318       6,875,237       16,033,068  
                         

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS

  $ 8,396,809     $ 6,733,540     $ 19,414,338  

 

See notes to financial statements.

 

 

45

 

 

 

Ave Maria Value Fund

STATEMENTS OF CHANGES IN NET ASSETS

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

 

FROM OPERATIONS

               

Net investment income (loss)

  $ (71,653 )   $ 1,136,725  

Net realized gains from investment transactions

    11,056,406       7,534,895  

Net change in unrealized appreciation (depreciation) on investments

    44,837,710       4,811,078  

Net increase in net assets resulting from operations

    55,822,463       13,482,698  
                 

FROM DISTRIBUTIONS TO SHAREHOLDERS (Note 1)

          (8,672,343 )
                 

FROM CAPITAL SHARE TRANSACTIONS

               

Proceeds from shares sold

    28,468,741       27,750,470  

Reinvestment of distributions to shareholders

          8,283,898  

Payments for shares redeemed

    (24,124,588 )     (37,340,674 )

Net increase (decrease) in net assets from capital share transactions

    4,344,153       (1,306,306 )
                 

TOTAL INCREASE IN NET ASSETS

    60,166,616       3,504,049  
                 

NET ASSETS

               

Beginning of period

    251,247,453       247,743,404  

End of period

  $ 311,414,069     $ 251,247,453  
                 

SUMMARY OF CAPITAL SHARE ACTIVITY

               

Shares sold

    1,199,246       1,601,300  

Shares issued in reinvestment of distributions to shareholders

          411,520  

Shares redeemed

    (1,045,033 )     (2,145,428 )

Net increase (decrease) in shares outstanding

    154,213       (132,608 )

Shares outstanding, beginning of period

    12,455,060       12,587,668  

Shares outstanding, end of period

    12,609,273       12,455,060  

 

See notes to financial statements.

 

 

46

 

 

 

Ave Maria Growth Fund

Statements of Changes in Net Assets

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

 

FROM OPERATIONS

               

Net investment income (loss)

  $ 673     $ (1,397,545 )

Net realized gains from investment transactions

    54,653,959       48,885,126  

Net change in unrealized appreciation (depreciation) on investments

    70,940,918       102,555,167  

Net increase in net assets resulting from operations

    125,595,550       150,042,748  
                 

FROM DISTRIBUTIONS TO SHAREHOLDERS (Note 1)

          (47,493,030 )
                 

FROM CAPITAL SHARE TRANSACTIONS

               

Proceeds from shares sold

    89,165,109       207,506,663  

Reinvestment of distributions to shareholders

          45,095,958  

Payments for shares redeemed

    (129,233,981 )     (261,168,824 )

Net decrease in net assets from capital share transactions

    (40,068,872 )     (8,566,203 )
                 

TOTAL INCREASE IN NET ASSETS

    85,526,678       93,983,515  
                 

NET ASSETS

               

Beginning of period

    948,747,410       854,763,895  

End of period

  $ 1,034,274,088     $ 948,747,410  
                 

SUMMARY OF CAPITAL SHARE ACTIVITY

               

Shares sold

    1,965,458       5,618,900  

Shares issued in reinvestment of distributions to shareholders

          1,062,822  

Shares redeemed

    (2,893,868 )     (6,965,246 )

Net decrease in shares outstanding

    (928,410 )     (283,524 )

Shares outstanding, beginning of period

    22,210,514       22,494,038  

Shares outstanding, end of period

    21,282,104       22,210,514  

 

See notes to financial statements.

 

 

47

 

 

 

Ave Maria Rising Dividend Fund

Statements of Changes in Net Assets

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

 

FROM OPERATIONS

               

Net investment income

  $ 4,296,939     $ 9,844,230  

Net realized gains from investment transactions

    54,165,019       12,661,959  

Net change in unrealized appreciation (depreciation) on investments

    76,300,519       12,335,464  

Net increase in net assets resulting from operations

    134,762,477       34,841,653  
                 

FROM DISTRIBUTIONS TO SHAREHOLDERS (Note 1)

    (4,137,950 )     (22,507,318 )
                 

FROM CAPITAL SHARE TRANSACTIONS

               

Proceeds from shares sold

    72,990,093       128,641,107  

Reinvestment of distributions to shareholders

    3,673,472       20,257,565  

Payments for shares redeemed

    (111,792,738 )     (256,790,815 )

Net decrease in net assets from capital share transactions

    (35,129,173 )     (107,892,143 )
                 

TOTAL INCREASE (DECREASE) IN NET ASSETS

    95,495,354       (95,557,808 )
                 

NET ASSETS

               

Beginning of period

    857,527,184       953,084,992  

End of period

  $ 953,022,538     $ 857,527,184  
                 

SUMMARY OF CAPITAL SHARE ACTIVITY

               

Shares sold

    3,447,531       7,682,610  

Shares issued in reinvestment of distributions to shareholders

    168,940       1,130,986  

Shares redeemed

    (5,424,412 )     (15,498,988 )

Net decrease in shares outstanding

    (1,807,941 )     (6,685,392 )

Shares outstanding, beginning of period

    44,342,779       51,028,171  

Shares outstanding, end of period

    42,534,838       44,342,779  

 

See notes to financial statements.

 

 

48

 

 

 

Ave Maria World Equity Fund

Statements of Changes in Net Assets

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

 

FROM OPERATIONS

               

Net investment income

  $ 235,491     $ 326,519  

Net realized gains (losses) from investment transactions

    1,816,544       (3,359,015 )

Net realized gains from foreign currency transactions (Note 1)

    1,699        

Net change in unrealized appreciation (depreciation) on investments

    6,341,913       2,559,275  

Net change in unrealized appreciation (depreciation) on foreign currency translation

    1,162        

Net increase (decrease) in net assets resulting from operations

    8,396,809       (473,221 )
                 

FROM DISTRIBUTIONS TO SHAREHOLDERS (Note 1)

          (326,947 )
                 

FROM CAPITAL SHARE TRANSACTIONS

               

Proceeds from shares sold

    9,827,737       14,933,771  

Reinvestment of distributions to shareholders

          301,435  

Payments for shares redeemed

    (7,991,622 )     (19,106,759 )

Net increase (decrease) in net assets from capital share transactions

    1,836,115       (3,871,553 )
                 

TOTAL INCREASE (DECREASE) IN NET ASSETS

    10,232,924       (4,671,721 )
                 

NET ASSETS

               

Beginning of period

    69,230,654       73,902,375  

End of period

  $ 79,463,578     $ 69,230,654  
                 

SUMMARY OF CAPITAL SHARE ACTIVITY

               

Shares sold

    567,865       1,100,322  

Shares issued in reinvestment of distributions to shareholders

          19,068  

Shares redeemed

    (471,579 )     (1,385,079 )

Net increase (decrease) in shares outstanding

    96,286       (265,689 )

Shares outstanding, beginning of period

    4,356,754       4,622,443  

Shares outstanding, end of period

    4,453,040       4,356,754  

 

See notes to financial statements.

 

 

49

 

 

 

Ave Maria Focused Fund

StatementS of Changes in Net Assets

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Period
Ended
December 31,
2020
(a)

 

FROM OPERATIONS

               

Net investment loss

  $ (141,697 )   $ (91,477 )

Net realized gains from investment transactions

    890,900       170,264  

Net change in unrealized appreciation (depreciation) on investments

    5,984,337       5,446,031  

Net increase in net assets resulting from operations

    6,733,540       5,524,818  
                 

FROM DISTRIBUTIONS TO SHAREHOLDERS (Note 1)

          (112,201 )
                 

FROM CAPITAL SHARE TRANSACTIONS

               

Proceeds from shares sold

    12,545,910       29,773,287  

Reinvestment of distributions to shareholders

          111,586  

Payments for shares redeemed

    (3,198,284 )     (981,224 )

Net increase in net assets from capital share transactions

    9,347,626       28,903,649  
                 

TOTAL INCREASE IN NET ASSETS

    16,081,166       34,316,266  
                 

NET ASSETS

               

Beginning of period

    34,316,266        

End of period

  $ 50,397,432     $ 34,316,266  
                 

SUMMARY OF CAPITAL SHARE ACTIVITY

               

Shares sold

    947,846       2,837,401  

Shares issued in reinvestment of distributions to shareholders

          9,057  

Shares redeemed

    (244,736 )     (85,868 )

Net increase in shares outstanding

    703,110       2,760,590  

Shares outstanding, beginning of period

    2,760,590        

Shares outstanding, end of period

    3,463,700       2,760,590  

 

(a)

Represents the period from commencement of operations (May 1, 2020) through December 31, 2020.

See notes to financial statements.

 

 

50

 

 

 

Ave Maria Bond Fund

Statements of Changes in Net Assets

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

 

FROM OPERATIONS

               

Net investment income

  $ 3,381,270     $ 7,283,416  

Net realized gains from investment transactions

    4,936,211       2,602,955  

Net change in unrealized appreciation (depreciation) on investments

    11,096,857       11,074,768  

Net increase in net assets resulting from operations

    19,414,338       20,961,139  
                 

FROM DISTRIBUTIONS TO SHAREHOLDERS (Note 1)

    (3,198,665 )     (9,878,726 )
                 

FROM CAPITAL SHARE TRANSACTIONS

               

Proceeds from shares sold

    82,171,710       126,643,756  

Reinvestment of distributions to shareholders

    2,879,248       8,928,357  

Payments for shares redeemed

    (67,720,828 )     (120,628,440 )

Net increase in net assets from capital share transactions

    17,330,130       14,943,673  
                 

TOTAL INCREASE IN NET ASSETS

    33,545,803       26,026,086  
                 

NET ASSETS

               

Beginning of period

    420,876,268       394,850,182  

End of period

  $ 454,422,071     $ 420,876,268  
                 

SUMMARY OF CAPITAL SHARE ACTIVITY

               

Shares sold

    6,685,038       10,895,295  

Shares issued in reinvestment of distributions to shareholders

    233,355       763,454  

Shares redeemed

    (5,530,826 )     (10,497,852 )

Net increase in shares outstanding

    1,387,567       1,160,897  

Shares outstanding, beginning of period

    35,089,355       33,928,458  

Shares outstanding, end of period

    36,476,922       35,089,355  

 

See notes to financial statements.

 

 

51

 

 

 

Ave Maria Value Fund

FINANCIAL HIGHLIGHTS

Per Share Data for a Share Outstanding Throughout Each Period

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

   

Year
Ended
December 31,
2019

   

Year
Ended
December 31,
2018

   

Year
Ended
December 31,
2017

   

Year
Ended
December 31,
2016

 

Net asset value at beginning of period

  $ 20.17     $ 19.68     $ 17.19     $ 20.88     $ 19.12     $ 16.42  
                                                 

Income (loss) from investment operations:

                                               

Net investment income (loss)

    (0.01 )     0.09       0.01       (0.03 )     (0.06 )     (0.03 )

Net realized and unrealized gains (losses) on investments

    4.54       1.12       3.52       (1.81 )     3.46       2.73  

Total from investment operations

    4.53       1.21       3.53       (1.84 )     3.40       2.70  
                                                 

Less distributions from:

                                               

Net investment income

          (0.09 )     (0.01 )                  

Net realized gains on investments

          (0.63 )     (1.03 )     (1.85 )     (1.64 )      

Total distributions

          (0.72 )     (1.04 )     (1.85 )     (1.64 )      
                                                 

Net asset value at end of period

  $ 24.70     $ 20.17     $ 19.68     $ 17.19     $ 20.88     $ 19.12  
                                                 

Total return (a)

    22.46 %(b)     6.16 %     20.52 %     (8.75 %)     17.73 %     16.44 %
                                                 

Ratios/Supplementary Data:

                                               

Net assets at end of period (000’s)

  $ 311,414     $ 251,247     $ 247,743     $ 211,481     $ 249,892     $ 224,593  
                                                 

Ratio of total expenses to average net assets

    1.00 %(c)     1.05 %     1.11 %     1.18 %     1.19 %     1.20 %
                                                 

Ratio of net investment income (loss) to average net assets

    (0.05 %)(c)     0.52 %     0.04 %     (0.13 %)     (0.32 %)     (0.15 %)
                                                 

Portfolio turnover rate

    11 %(b)     68 %     40 %     43 %     40 %     47 %

 

(a)

Total return is a measure of the change in value of an investment in the Fund over the period covered, which assumes any dividends or capital gains distributions are reinvested in shares of the Fund. The returns shown do not reflect the deduction of taxes a shareholder would pay on Fund distributions or the redemption of Fund shares.

(b)

Not annualized.

(c)

Annualized.

See notes to financial statements.

 

 

52

 

 

 

Ave Maria Growth Fund

Financial Highlights

Per Share Data for a Share Outstanding Throughout Each Period

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

   

Year
Ended
December 31,
2019

   

Year
Ended
December 31,
2018

   

Year
Ended
December 31,
2017

   

Year
Ended
December 31,
2016

 

Net asset value at beginning of period

  $ 42.72     $ 38.00     $ 28.19     $ 30.80     $ 26.44     $ 25.02  
                                                 

Income (loss) from investment operations:

                                               

Net investment income (loss)

    0.00 (a)      (0.06 )     0.00 (a)      0.06       0.03       0.02  

Net realized and unrealized gains (losses) on investments

    5.88       7.03       10.45       (0.63 )     7.22       3.01  

Total from investment operations

    5.88       6.97       10.45       (0.57 )     7.25       3.03  
                                                 

Less distributions from:

                                               

Net investment income

                (0.00 )(a)     (0.06 )     (0.03 )     (0.02 )

Net realized gains on investments

          (2.25 )     (0.64 )     (1.98 )     (2.86 )     (1.59 )

Total distributions

          (2.25 )     (0.64 )     (2.04 )     (2.89 )     (1.61 )
                                                 

Net asset value at end of period

  $ 48.60     $ 42.72     $ 38.00     $ 28.19     $ 30.80     $ 26.44  
                                                 

Total return (b)

    13.76 %(c)     18.37 %     37.09 %     (1.80 %)     27.36 %     12.07 %
                                                 

Ratios/Supplementary Data:

                                               

Net assets at end of period (000’s)

  $ 1,034,274     $ 948,747     $ 854,764     $ 577,806     $ 482,515     $ 351,085  
                                                 

Ratio of total expenses to average net assets

    0.91 %(d)     0.91 %     0.94 %     0.95 %     1.08 %     1.17 %
                                                 

Ratio of net investment income (loss) to average net assets

    0.00 %(d)(e)     (0.16 %)     0.00 %(e)     0.19 %     0.10 %     0.09 %
                                                 

Portfolio turnover rate

    9 %(c)     26 %     15 %     33 %     26 %     29 %

 

(a)

Amount rounds to less than $0.01 per share.

(b)

Total return is a measure of the change in value of an investment in the Fund over the period covered, which assumes any dividends or capital gains distributions are reinvested in shares of the Fund. The returns shown do not reflect the deduction of taxes a shareholder would pay on Fund distributions or the redemption of Fund shares.

(c)

Not annualized.

(d)

Annualized.

(e)

Percentage rounds to less than 0.01%.

See notes to financial statements.

 

 

53

 

 

 

Ave Maria Rising Dividend Fund

Financial Highlights

Per Share Data for a Share Outstanding Throughout Each Period

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

   

Year
Ended
December 31,
2019

   

Year
Ended
December 31,
2018

   

Year
Ended
December 31,
2017

   

Year
Ended
December 31,
2016

 

Net asset value at beginning of period

  $ 19.34     $ 18.68     $ 15.83     $ 18.44     $ 16.79     $ 15.58  
                                                 

Income (loss) from investment operations:

                                               

Net investment income

    0.10       0.21       0.23       0.24       0.20       0.27  

Net realized and unrealized gains (losses) on investments

    3.07       0.95       4.12       (1.13 )     2.62       2.11  

Total from investment operations

    3.17       1.16       4.35       (0.89 )     2.82       2.38  
                                                 

Less distributions from:

                                               

Net investment income

    (0.10 )     (0.21 )     (0.23 )     (0.25 )     (0.20 )     (0.28 )

Net realized gains on investments

          (0.29 )     (1.27 )     (1.47 )     (0.97 )     (0.89 )

Total distributions

    (0.10 )     (0.50 )     (1.50 )     (1.72 )     (1.17 )     (1.17 )
                                                 

Net asset value at end of period

  $ 22.41     $ 19.34     $ 18.68     $ 15.83     $ 18.44     $ 16.79  
                                                 

Total return (a)

    16.39 %(b)     6.45 %     27.58 %     (4.80 %)     16.82 %     15.33 %
                                                 

Ratios/Supplementary Data:

                                               

Net assets at end of period (000’s)

  $ 953,023     $ 857,527     $ 953,085     $ 780,811     $ 970,109     $ 828,649  
                                                 

Ratio of total expenses to average net assets

    0.91 %(c)     0.92 %     0.93 %     0.93 %     0.92 %     0.92 %
                                                 

Ratio of net investment income to average net assets

    0.96 %(c)     1.21 %     1.23 %     1.25 %     1.12 %     1.61 %
                                                 

Portfolio turnover rate

    17 %(b)     38 %     30 %     31 %     26 %     24 %

 

(a)

Total return is a measure of the change in value of an investment in the Fund over the period covered, which assumes any dividends or capital gains distributions are reinvested in shares of the Fund. The returns shown do not reflect the deduction of taxes a shareholder would pay on Fund distributions or the redemption of Fund shares.

(b)

Not annualized.

(c)

Annualized.

See notes to financial statements.

 

 

54

 

 

 

Ave Maria World Equity Fund

Financial Highlights

Per Share Data for a Share Outstanding Throughout Each Period

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

   

Year
Ended
December 31,
2019

   

Year
Ended
December 31,
2018

   

Year
Ended
December 31,
2017

   

Year
Ended
December 31,
2016

 

Net asset value at beginning of period

  $ 15.89     $ 15.99     $ 13.10     $ 15.08     $ 13.18     $ 12.36  
                                                 

Income (loss) from investment operations:

                                               

Net investment income

    0.05       0.08       0.11       0.15       0.07       0.06  

Net realized and unrealized gains (losses) on investments and foreign currencies

    1.90       (0.10 )     3.51       (1.49 )     2.29       1.01  

Total from investment operations

    1.95       (0.02 )     3.62       (1.34 )     2.36       1.07  
                                                 

Less distributions from:

                                               

Net investment income

          (0.08 )     (0.11 )     (0.15 )     (0.07 )     (0.06 )

Net realized gains on investments

                (0.62 )     (0.49 )     (0.39 )     (0.19 )

Total distributions

          (0.08 )     (0.73 )     (0.64 )     (0.46 )     (0.25 )
                                                 

Net asset value at end of period

  $ 17.84     $ 15.89     $ 15.99     $ 13.10     $ 15.08     $ 13.18  
                                                 

Total return (a)

    12.27 %(b)     (0.15 %)     27.66 %     (8.87 %)     17.88 %     8.71 %
                                                 

Ratios/Supplementary Data:

                                               

Net assets at end of period (000’s)

  $ 79,464     $ 69,231     $ 73,902     $ 57,044     $ 62,170     $ 46,030  
                                                 

Ratio of total expenses to average net assets

    1.25 %(c)     1.26 %     1.29 %     1.34 %     1.41 %     1.45 %
                                                 

Ratio of net expenses to average net assets (d)

    1.25 %(c)     1.25 %     1.25 %     1.25 %     1.25 %     1.33 %
                                                 

Ratio of net investment income to average net assets (d)

    0.64 %(c)     0.51 %     0.77 %     0.98 %     0.50 %     0.50 %
                                                 

Portfolio turnover rate

    15 %(b)     43 %     37 %     33 %     29 %     42 %

 

(a)

Total return is a measure of the change in value of an investment in the Fund over the period covered, which assumes any dividends or capital gains distributions are reinvested in shares of the Fund. The returns shown do not reflect the deduction of taxes a shareholder would pay on Fund distributions or the redemption of Fund shares.

(b)

Not annualized.

(c)

Annualized.

(d)

Ratio was determined after advisory fee reductions and/or recoupments (Note 2).

See notes to financial statements.

 

 

55

 

 

 

Ave Maria Focused Fund

Financial Highlights

Per Share Data for a Share Outstanding Throughout Each Period

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Period
Ended
December 31,
2020
(a)

 

Net asset value at beginning of period

  $ 12.43     $ 10.00  
                 

Income (loss) from investment operations:

               

Net investment loss

    (0.04 )     (0.03 )

Net realized and unrealized gains on investments

    2.16       2.50  

Total from investment operations

    2.12       2.47  
                 

Less distributions from:

               

Net realized gains on investments

          (0.04 )
                 

Net asset value at end of period

  $ 14.55     $ 12.43  
                 

Total return (b)

    17.06 %(c)     24.71 %(c)
                 

Ratios/Supplementary Data:

               

Net assets at end of period (000’s)

  $ 50,397     $ 34,316  
                 

Ratio of total expenses to average net assets

    1.27 %(d)     1.29 %(d)
                 

Ratio of net expenses to average net assets (e)

    1.25 %(d)     1.25 %(d)
                 

Ratio of net investment loss to average net assets (e)

    (0.69 %)(d)     (0.54 %)(d)
                 

Portfolio turnover rate

    11 %(c)     16 %(c)

 

(a)

Represents the period from the commencement of operations (May 1, 2020) through December 31, 2020.

(b)

Total return is a measure of the change in value of an investment in the Fund over the period covered, which assumes any dividends or capital gains distributions are reinvested in shares of the Fund. The returns shown do not reflect the deduction of taxes a shareholder would pay on Fund distributions or the redemption of Fund shares.

(c)

Not annualized.

(d)

Annualized.

(e)

Ratio was determined after advisory fee reductions (Note 2).

See notes to financial statements.

 

 

56

 

 

 

Ave Maria Bond Fund

Financial Highlights

Per Share Data for a Share Outstanding Throughout Each Period

 

 

Six Months
Ended
June 30, 2021
(Unaudited)

   

Year
Ended
December 31,
2020

   

Year
Ended
December 31,
2019

   

Year
Ended
December 31,
2018

   

Year
Ended
December 31,
2017

   

Year
Ended
December 31,
2016

 

Net asset value at beginning of period

  $ 11.99     $ 11.64     $ 11.11     $ 11.42     $ 11.19     $ 11.02  
                                                 

Income (loss) from investment operations:

                                               

Net investment income

    0.09       0.22       0.22       0.19       0.17       0.15  

Net realized and unrealized gains (losses) on investments

    0.47       0.42       0.70       (0.14 )     0.30       0.35  

Total from investment operations

    0.56       0.64       0.92       0.05       0.47       0.50  
                                                 

Less distributions from:

                                               

Net investment income

    (0.09 )     (0.22 )     (0.22 )     (0.19 )     (0.17 )     (0.15 )

Net realized gains on investments

          (0.07 )     (0.17 )     (0.17 )     (0.07 )     (0.18 )

Total distributions

    (0.09 )     (0.29 )     (0.39 )     (0.36 )     (0.24 )     (0.33 )
                                                 

Net asset value at end of period

  $ 12.46     $ 11.99     $ 11.64     $ 11.11     $ 11.42     $ 11.19  
                                                 

Total return (a)

    4.68 %(b)     5.60 %     8.30 %     0.41 %     4.16 %     4.54 %
                                                 

Ratios/Supplementary Data:

                                               

Net assets at end of period (000’s)

  $ 454,422     $ 420,876     $ 394,850     $ 323,716     $ 307,234     $ 248,971  
                                                 

Ratio of total expenses to average net assets

    0.45 %(c)     0.47 %     0.49 %     0.50 %     0.50 %     0.50 %
                                                 

Ratio of net investment income to average net assets

    1.57 %(c)     1.87 %     1.91 %     1.68 %     1.47 %     1.34 %
                                                 

Portfolio turnover rate

    19 %(b)     47 %     31 %     26 %     19 %     21 %

 

(a)

Total return is a measure of the change in value of an investment in the Fund over the period covered, which assumes any dividends or capital gains distributions are reinvested in shares of the Fund. The returns shown do not reflect the deduction of taxes a shareholder would pay on Fund distributions or the redemption of Fund shares.

(b)

Not annualized.

(c)

Annualized.

See notes to financial statements.

 

 

57

 

 

 

AVE MARIA MUTUAL FUNDS

Notes to Financial Statements

June 30, 2021 (Unaudited)

 

 

1. Organization and Significant Accounting Policies

 

The Ave Maria Value Fund, the Ave Maria Growth Fund, the Ave Maria Rising Dividend Fund, the Ave Maria World Equity Fund, the Ave Maria Focused Fund and the Ave Maria Bond Fund (individually, a “Fund” and collectively, the “Funds”) are each a diversified series, except for the Ave Maria Focused Fund, which is a non-diversified series of the Schwartz Investment Trust (the “Trust”), an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”), and established as an Ohio business trust under a Declaration of Trust dated August 31, 1992.

 

The investment objective of the Ave Maria Value Fund is to seek long-term capital appreciation from equity investments in companies that do not violate core values and teachings of the Roman Catholic Church.

 

The investment objective of the Ave Maria Growth Fund is to seek long-term capital appreciation, using the growth style, from equity investments in companies that do not violate core values and teachings of the Roman Catholic Church.

 

The investment objective of the Ave Maria Rising Dividend Fund is to provide increasing dividend income over time, long-term growth of capital, and a reasonable level of current income from investments in dividend-paying common stocks of companies that do not violate core values and teachings of the Roman Catholic Church.

 

The investment objective of the Ave Maria World Equity Fund is to seek long-term capital appreciation from equity investments in U.S. and non-U.S. companies that do not violate core values and teachings of the Roman Catholic Church.

 

The investment objective of the Ave Maria Focused Fund is to seek long-term capital appreciation from equity investments in companies that do not violate core values and teachings of the Roman Catholic Church.

 

The investment objective of the Ave Maria Bond Fund is to seek preservation of principal with a reasonable level of current income in corporate debt and equity securities that do not violate core values and teachings of the Roman Catholic Church.

 

See the Funds’ Prospectus for information regarding the investment strategies of each Fund.

 

Shares of each Fund are sold at net asset value (“NAV”). To calculate the NAV, a Fund’s assets are valued and totaled, liabilities are subtracted, and the balance is divided by the number of shares outstanding. The offering price and redemption price per share are equal to the NAV per share for each Fund.

 

58

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

The Funds follow accounting and reporting guidance under Financial Accounting Standards Board Accounting Standards Codification Topic 946, “Financial Services – Investment Companies.” The following is a summary of significant accounting policies followed by the Funds. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

 

(a) Valuation of investments – Securities which are traded on stock exchanges are valued at the closing sales price as of the close of the regular session of trading on the New York Stock Exchange on the day the securities are being valued, or, if not traded on a particular day, at the closing bid price. Securities which are quoted by NASDAQ are valued at the NASDAQ Official Closing Price or, if an Official Closing Price is not available, at the most recently quoted bid price. Securities traded in the over-the-counter market are valued at the last reported sales price or, if there is no reported sale on the valuation date, at the most recently quoted bid price. Securities which are traded both in the over-the-counter market and on a stock exchange are valued according to the broadest and most representative market. Fixed income securities are generally valued using prices provided by an independent pricing service. The independent pricing service uses information with respect to transactions in bonds, quotations from bond dealers, market transactions in comparable securities and various relationships between securities in determining these prices. Investments in shares of other open-end investment companies are valued at their NAV as reported by such companies. When using quoted prices and when the market for the securities are considered active, the securities will be classified as Level 1 within the fair value hierarchy (see below). Securities for which market quotations are not readily available are valued at their fair value as determined in good faith in accordance with consistently applied procedures established by and under the general supervision of the Board of Trustees, and will be classified as Level 2 or 3 within the fair value hierarchy, depending on the inputs used. Fair value pricing may be used, for example, in situations where (i) a security is so thinly traded that there have been no transactions for that stock over an extended period of time; (ii) the exchange on which the security is principally traded closes early; or (iii) trading of the security is halted during the day and does not resume prior to a Fund’s NAV calculation. A security’s “fair value” price may differ from the price next available for that security using the Funds’ normal pricing procedures. Securities traded on foreign exchanges are typically fair valued by an independent pricing service and translated from the local currency into U.S. dollars using currency exchange rates supplied by an independent pricing service.

 

GAAP establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and requires additional disclosures about fair value measurements.

 

59

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

Various inputs are used in determining the value of each Fund’s investments. These inputs are summarized in the three broad levels listed below:

 

 

Level 1 – quoted prices in active markets for identical securities

 

 

Level 2 – other significant observable inputs

 

 

Level 3 – significant unobservable inputs

 

The Funds’ foreign equity securities actively traded in foreign markets may be classified as Level 2 despite the availability of closing prices because such securities are typically fair valued by an independent pricing service. The Board of Trustees has authorized the Funds to retain an independent pricing service to determine the fair value of its foreign securities because the value of such securities may be materially affected by events occurring before the Funds’ pricing time but after the close of the primary markets or exchanges on which such foreign securities are traded. These intervening events might be country-specific (e.g., natural disaster, economic or political developments, interest rate change); issuer specific (e.g., earnings report or merger announcement); or U.S. market-specific (such as a significant movement in the U.S. market that is deemed to affect the value of foreign securities). The pricing service uses an automated system that incorporates a model based on multiple parameters, including a security’s local closing price, relevant general and sector indices, currency fluctuations, trading in depositary receipts and futures, if applicable, and/or research valuations by its staff, in determining what it believes is the fair value of the securities.

 

U.S. Government & Agencies and Corporate Bonds held by the Funds, if any, are classified as Level 2 since the values for such securities are based on prices provided by an independent pricing service that utilizes various “other significant observable inputs” including bid and ask quotations, prices of similar securities and interest rates, among other factors.

 

The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement.

 

60

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

The following is a summary of the Funds’ investments and the levels assigned to the investments, by security type, as of June 30, 2021:

 

Ave Maria Value Fund

 

Level 1

   

Level 2

   

Level 3

   

Total

 

Common Stocks

  $ 298,379,601     $ 2,635,427     $     $ 301,015,028  

Money Market Funds

    10,939,908                   10,939,908  

Total

  $ 309,319,509     $ 2,635,427     $     $ 311,954,936  
 

 

Ave Maria Growth Fund

 

Level 1

   

Level 2

   

Level 3

   

Total

 

Common Stocks

  $ 1,029,126,233     $     $     $ 1,029,126,233  

Money Market Funds

    7,221,910                   7,221,910  

Total

  $ 1,036,348,143     $     $     $ 1,036,348,143  
 

 

Ave Maria Rising Dividend Fund

 

Level 1

   

Level 2

   

Level 3

   

Total

 

Common Stocks

  $ 931,252,488     $     $     $ 931,252,488  

Money Market Funds

    22,759,511                   22,759,511  

Total

  $ 954,011,999     $     $     $ 954,011,999  
 

 

Ave Maria World Equity Fund

 

Level 1

   

Level 2

   

Level 3

   

Total

 

Common Stocks

  $ 76,365,310     $ 2,415,041     $     $ 78,780,351  

Money Market Funds

    1,118,879                   1,118,879  

Total

  $ 77,484,189     $ 2,415,041     $     $ 79,899,230  
 

 

Ave Maria Focused Fund

 

Level 1

   

Level 2

   

Level 3

   

Total

 

Common Stocks

  $ 41,586,799     $ 6,346,155     $     $ 47,932,954  

Money Market Funds

    1,514,258                   1,514,258  

Total

  $ 43,101,057     $ 6,346,155     $     $ 49,447,212  
 

 

Ave Maria Bond Fund

 

Level 1

   

Level 2

   

Level 3

   

Total

 

U.S. Government & Agencies

  $     $ 112,653,335     $     $ 112,653,335  

Corporate Bonds

          229,198,888             229,198,888  

Common Stocks

    88,998,967                   88,998,967  

Money Market Funds

    21,175,025                   21,175,025  

Total

  $ 110,173,992     $ 341,852,223     $     $ 452,026,215  
 

 

61

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

Refer to each Fund’s Schedule of Investments for a listing of the securities by security type and sector or industry type. There were no Level 3 securities or derivative instruments held by or transferred in/out of the Funds as of or during the six months ended June 30, 2021.

 

(b) Income taxes – Each Fund has qualified and intends to continue to qualify as a regulated investment company under the Internal Revenue Code of 1986, as amended (the “Code”). Qualification generally will relieve each Fund of liability for federal income taxes to the extent 100% of its net investment income and net realized capital gains are distributed in accordance with the Code.

 

In order to avoid imposition of the excise tax applicable to regulated investment companies, it is also each Fund’s intention to declare as dividends in each calendar year at least 98% of its net investment income and 98.2% of its net realized capital gains plus undistributed amounts from prior years.

 

The following information is computed on a tax basis for each item as of June 30, 2021:

 

 

 

Ave Maria
Value Fund

   

Ave Maria
Growth
Fund

   

Ave Maria
Rising
Dividend
Fund

 

Federal income tax cost

  $ 206,741,186     $ 574,312,734     $ 641,277,176  

Gross unrealized appreciation

  $ 110,003,694     $ 463,118,379     $ 313,776,254  

Gross unrealized depreciation

    (4,789,944 )     (1,082,970 )     (1,041,431 )

Net unrealized appreciation

    105,213,750       462,035,409       312,734,823  

Accumulated ordinary income (loss)

    (71,653 )     673       158,989  

Other gains

    11,056,406       54,653,959       54,165,019  

Accumulated earnings

  $ 116,198,503     $ 516,690,041     $ 367,058,831  
 

 

 

 

Ave Maria
World
Equity Fund

   

Ave Maria
Focused
Fund

   

Ave Maria
Bond
Fund

 

Federal income tax cost

  $ 55,194,612     $ 38,025,950     $ 412,141,291  

Gross unrealized appreciation

  $ 25,132,445     $ 11,443,559     $ 40,732,769  

Gross unrealized depreciation

    (427,827 )     (22,297 )     (847,845 )

Net unrealized appreciation

    24,704,618       11,421,262       39,884,924  

Net unrealized appreciation on foreign currency translation

    1,162              

Accumulated ordinary income (loss)

    237,190       (141,697 )     190,250  

Capital loss carryforwards

    (3,389,025 )            

Other gains

    1,816,544       866,902       4,936,211  

Accumulated earnings

  $ 23,370,489     $ 12,146,467     $ 45,011,385  
 

 

62

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

The difference between the federal income tax cost of portfolio investments and the financial statement cost of portfolio investments for the Ave Maria Focused Fund is due to certain timing differences in the recognition of capital gains and losses under income tax regulations and GAAP. These “book/tax” differences are temporary in nature and are due to the tax deferral of losses on wash sales. There is no difference between the federal income tax cost and the financial statement cost of portfolio investments for the Ave Maria Value Fund, the Ave Maria Growth Fund, the Ave Maria Rising Dividend Fund, the Ave Maria World Equity Fund and the Ave Maria Bond Fund as of June 30, 2021.

 

As of December 31, 2020, the Ave Maria World Equity Fund had a short-term capital loss carryforward of $2,956,407 and a long-term capital loss carryforward of $432,618 for federal income tax purposes, which may be carried forward indefinitely. These capital loss carryforwards are available to offset net realized gains in the current and future years, thereby reducing future taxable gains distributions.

 

The Funds recognize the tax benefits or expenses of uncertain tax positions only when the position is “more-likely-than-not” to be sustained assuming examination by tax authorities. Management has reviewed the tax positions taken on federal income tax returns for the current and all open tax years (generally, three years) and has concluded that no provision for unrecognized tax benefits or expenses is required in these financial statements.

 

(c) Investment transactions and investment income – Investment transactions are accounted for on the trade date. Dividend income is recorded on the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on the accrual basis and includes amortization of premiums and accretion of discounts using the effective yield method. Cost of investments includes amortization of premiums and accretion of discounts. Realized gains and losses on investments sold are determined on a specific identification basis. Withholding taxes on foreign dividends have been recorded in accordance with the Funds’ understanding of the applicable country’s rules and tax rates.

 

(d) Dividends and distributions – Dividends from net investment income, if any, are declared and paid annually in December for the Ave Maria Value Fund, the Ave Maria Growth Fund, the Ave Maria World Equity Fund and the Ave Maria Focused Fund. Dividends from net investment income, if any, are declared and paid quarterly for the Ave Maria Rising Dividend Fund and are declared and paid monthly for the Ave Maria Bond Fund. Each Fund expects to distribute any net realized capital gains

 

63

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

annually. Dividends and distributions to shareholders are recorded on the ex-dividend date. The tax character of distributions paid to shareholders during the periods ended June 30, 2021 and December 31, 2020 was as follows:

 

Period Ended

 

Ordinary
Income

   

Long-Term
Capital Gains

   

Total
Distributions*

 

Ave Maria Value Fund:

                       

June 30, 2021

  $     $     $  

December 31, 2020

  $ 1,136,725     $ 7,534,895     $ 8,671,620  

Ave Maria Growth Fund:

                       

June 30, 2021

  $     $     $  

December 31, 2020

  $ 7,234,484     $ 40,253,097     $ 47,487,581  

Ave Maria Rising Dividend Fund:

                       

June 30, 2021

  $ 4,137,950     $     $ 4,137,950  

December 31, 2020

  $ 9,844,230     $ 12,661,959     $ 22,506,189  

Ave Maria World Equity Fund:

                       

June 30, 2021

  $     $     $  

December 31, 2020

  $ 326,519     $     $ 326,519  

Ave Maria Focused Fund:

                       

June 30, 2021

  $     $     $  

December 31, 2020**

  $ 111,891     $     $ 111,891  

Ave Maria Bond Fund:

                       

June 30, 2021

  $ 3,198,665     $     $ 3,198,665  

December 31, 2020

  $ 7,275,771     $ 2,602,955     $ 9,878,726  

 

*

Total Distributions may not tie to the amounts listed on the Statements of Changes in Net Assets due to reclassifications of the character of the distributions as a result of permanent differences between the financial statements and income tax reporting.

**

Represents the period from the commencement of operations (May 1, 2020) thorugh December 31, 2020.

 

(e) Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

(f) Common expenses – Common expenses of the Trust are allocated among the series of the Trust based on relative net assets of each series or the nature of the services performed and the relative applicability to each series.

 

64

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

(g) Foreign currency translation – Securities and other assets and liabilities denominated in or expected to settle in foreign currencies are translated into U.S. dollars based on exchange rates on the following basis:

 

 

(i).

The fair values of investment securities and other assets and liabilities are translated as of the close of the NYSE each day.

 

 

(ii).

Purchases and sales of investment securities and income and expenses are translated at the rate of exchange prevailing as of 4:00 p.m. Eastern Time on the respective date of such transactions.

 

 

(iii).

The Funds do not isolate that portion of the results of operations caused by changes in foreign exchange rates on investments from those caused by changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gains or losses on investments.

 

Reported net realized foreign exchange gains or losses arise from 1) purchase and sales of foreign currencies, 2) currency gains or losses realized between the trade and settlement dates on securities transactions and 3) the difference between the amounts of dividends and foreign withholding taxes recorded on the Funds’ books and the U.S. dollar equivalent of the amounts actually received or paid. Reported net unrealized foreign exchange gains and losses arise from changes in the value of assets and liabilities that result from changes in exchange rates.

 

The Funds may be subject to foreign taxes related to foreign income received, capital gains on the sale of securities and certain foreign currency transactions (a portion of which may be reclaimable). All foreign taxes are recorded in accordance with the applicable regulations and rates that exist in the foreign jurisdictions in which the Funds invest.

 

2. Investment Advisory Agreements and Transactions with Related Parties

 

The Chairman and President of the Trust is also the Chairman and Chief Executive Officer of Schwartz Investment Counsel, Inc. (the “Adviser”). Certain other officers of the Trust are officers of the Adviser, or of Ultimus Fund Solutions, LLC (“Ultimus”), the administrative, accounting and transfer agent for the Funds, or of Ultimus Fund Distributors, LLC (the “Distributor”), the Funds’ principal underwriter.

 

Pursuant to Investment Advisory Agreements between the Trust and the Adviser, the Adviser is responsible for the management of each Fund and provides investment advice along with the necessary personnel, facilities, equipment and certain other services

 

65

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

necessary to the operations of the Funds. The Adviser receives fees based on a percentage of the average daily net assets of each Fund, which are accrued daily and paid quarterly, at the annual rates as stated below:

 

Ave Maria Value Fund *

    0.75 %

Ave Maria Growth Fund

    0.75 %

Ave Maria Rising Dividend Fund

    0.75 %

Ave Maria World Equity Fund

    0.95 %

Ave Maria Focused Fund

    0.85 %

Ave Maria Bond Fund *

    0.25 %

 

*

Effective May 1, 2021, the Adviser reduced its fees from 0.85% to 0.75% for the Ave Maria Value Fund and from 0.30% to 0.25% for the Ave Maria Bond Fund.

 

The Adviser has contractually agreed to reduce its advisory fees or reimburse a portion of operating expenses until at least May 1, 2022 so that the ordinary operating expenses of each of the Ave Maria Value Fund, the Ave Maria Growth Fund, the Ave Maria Rising Dividend Fund and the Ave Maria World Equity Fund do not exceed 1.25% per annum of average daily net assets; and so that the ordinary operating expenses of the Ave Maria Bond Fund do not exceed 0.60% per annum of average daily net assets. The Adviser has contractually agreed to reduce its advisory fees or reimburse a portion of operating expenses until at least May 1, 2023 so that the ordinary operating expenses of the Ave Maria Focused Fund do not exceed 1.25% per annum of average daily net assets. Accordingly, during the six months ended June 30, 2021, the Adviser reduced its investment advisory fees by $4,081 with respect to the Ave Maria Focused Fund.

 

Any investment advisory fee reductions or expense reimbursements by the Adviser are subject to repayment by the Funds for a period of three years after such fees and expenses were incurred, provided the Funds are able to effect such repayment and remain in compliance with any undertaking by the Adviser to limit expenses of the Funds. During the six months ended June 30, 2021, the Ave Maria World Equity Fund recouped $858 of prior years’ investment advisory fee reductions. As of June 30, 2021, the Adviser may

 

66

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

seek recoupment of investment advisory fee reductions from the Ave Maria World Equity Fund and the Ave Maria Focused Fund totaling $45,767 and $10,996, respectively, no later than the dates as stated below:

 

 

 

Ave Maria
World
Equity Fund

   

Ave Maria
Focused Fund

 

December 31, 2021

  $ 5,590     $  

December 31, 2022

    24,996        

December 31, 2023

    15,181       6,915  

June 30, 2024

          4,081  

Total

  $ 45,767     $ 10,996  
 

 

The Chief Compliance Officer of the Trust (the “CCO”) is an employee of the Adviser. The Trust pays the Adviser a fee for providing CCO services, of which each Fund pays its proportionate share along with the other series of the Trust. In addition, the Trust reimburses the Adviser for out-of-pocket expenses incurred, if any, for providing these services.

 

Pursuant to a Mutual Fund Services Agreement between the Trust and Ultimus, Ultimus supplies regulatory and compliance services, calculates the daily NAV per share of each Fund, maintains the financial books and records of the Funds, maintains the records of each shareholder’s account, and processes purchases and redemptions of each Fund’s shares. For the performance of these services, Ultimus receives fees from each Fund computed as a percentage of such Fund’s average daily net assets, subject to a minimum monthly fee.

 

Pursuant to a Distribution Agreement between the Trust and the Distributor, the Distributor serves as each Fund’s exclusive agent for the distribution of its shares. The Distributor is an affiliate of Ultimus.

 

Trustees and officers affiliated with the Adviser or Ultimus are not compensated by the Trust for their services. Each Trustee who is not an affiliated person of the Adviser or Ultimus (“Independent Trustee”) receives from the Trust an annual retainer of $53,000 (except that such fee is $64,500 for the Lead Independent Trustee/Chairman of the Governance Committee and $59,500 for the Chairman of the Audit Committee), payable quarterly; a fee of $6,000 for attendance at each meeting of the Board of Trustees; plus reimbursement of travel and other expenses incurred in attending meetings. Trustee Emeritus receives one-half of both the annual retainer and fee for attendance at each meeting; plus reimbursement of travel and other expenses incurred in attending meetings. Each Fund pays its proportionate share of the Independent Trustees’ fees and expenses along with the other series of the Trust.

 

67

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

Each member of the Catholic Advisory Board (“CAB”), including Emeritus members, receives an annual retainer of $4,000 (except that such fee is $14,000 for the CAB chairman), payable quarterly; a fee of $3,000 for attendance at each meeting of the CAB; plus reimbursement of travel and other expenses incurred in attending meetings. Each Fund pays its proportionate share of CAB members’ fees and expenses.

 

3. Investment Transactions

 

During the six months ended June 30, 2021, cost of purchases and proceeds from sales and maturities of investment securities, excluding short-term investments and U.S. government securities, were as follows:

 

 

 

Ave Maria
Value Fund

   

Ave Maria
Growth Fund

   

Ave Maria
Rising
Dividend
Fund

 

Purchases of investment securities

  $ 46,820,352     $ 87,608,149     $ 144,640,110  

Proceeds from sales of investment securities

  $ 29,095,205     $ 123,702,373     $ 180,518,223  
 

 

 

 

Ave Maria
World
Equity Fund

   

Ave Maria
Focused
Fund

   

Ave Maria
Bond Fund

 

Purchases of investment securities

  $ 13,985,254     $ 13,484,083     $ 32,643,315  

Proceeds from sales and maturities of investment securities

  $ 11,105,018     $ 4,364,214     $ 45,813,145  
 

 

4. Contingencies and Commitments

 

The Funds indemnify the Trust’s officers and Trustees for certain liabilities that might arise from their performance of their duties to the Funds. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the Funds expect the risk of loss to be remote.

 

5. Sector Risk

 

If a Fund has significant investments in the securities of issuers in industries within a particular sector, any development affecting that sector will have a greater impact on the value of the net assets of the Fund than would be the case if the Fund did not have significant investments in that sector. In addition, this may increase the risk of loss of an investment in the Fund and increase the volatility of the Fund’s NAV per share. From

 

68

 

 

 

AVE MARIA MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(Continued)

 

 

time to time, circumstances may affect a particular sector and the companies within such sector. For instance, economic or market factors, regulation or deregulation, and technological or other developments may negatively impact all companies in a particular sector and therefore the value of a Fund’s portfolio will be adversely affected. As of June 30, 2021, the Ave Maria Growth Fund, the Ave Maria Rising Dividend Fund, the Ave Maria World Equity Fund and the Ave Maria Focused Fund had 40.1%, 31.2%, 32.0% and 25.5%, respectively, of the value of their net assets invested in stocks within the technology sector.

 

6. Subsequent Events

 

The Funds are required to recognize in the financial statements the effects of all subsequent events that provide additional evidence about conditions that existed as of the date of the Statements of Assets and Liabilities. For non-recognized subsequent events that must be disclosed to keep the financial statements from being misleading, the Funds are required to disclose the nature of the event as well as an estimate of its financial effect, or a statement that such an estimate cannot be made. Management has evaluated subsequent events through the issuance of these financial statements and has noted no such events.

 

69

 

 

 

AVE MARIA MUTUAL FUNDS

About Your Funds’ Expenses

(Unaudited)

 

 

We believe it is important for you to understand the impact of costs on your investment. As a shareholder of the Funds, you incur ongoing costs, including management fees and other Fund expenses. The following examples are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

 

A mutual fund’s ongoing costs are expressed as a percentage of its average net assets. This figure is known as the expense ratio. The ongoing costs reflected in the table below is based on an investment of $1,000 made at the beginning of the most recent semi-annual period (January 1, 2021) and held until the end of the period (June 30, 2021).

 

The table that follows illustrates each Fund’s ongoing costs in two ways:

 

Actual fund return – This section helps you to estimate the actual expenses that you paid over the period. The “Ending Account Value” shown is derived from each Fund’s actual return, and the fourth column shows the dollar amount of operating expenses that would have been paid by an investor who started with $1,000 in the Funds. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period.

 

To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for the Funds under the heading “Expenses Paid During Period.”

 

Hypothetical 5% return – This section is intended to help you compare each Fund’s ongoing costs with those of other mutual funds. It assumes that each Fund had an annual return of 5% before expenses during the period shown, but that the expense ratio is unchanged. In this case, because the return used is not the Funds’ actual returns, the results do not apply to your investment. The example is useful in making comparisons because the U.S Securities and Exchange Commission (the “SEC”) requires all mutual funds to calculate expenses based on a 5% return. You can assess each Fund’s ongoing costs by comparing this hypothetical example with the hypothetical examples that appear in shareholder reports of other funds.

 

Note that expenses shown in the table are meant to highlight and help you compare ongoing costs only. The Funds do not charge sales loads or redemption fees.

 

The calculations assume no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions.

 

70

 

 

 

AVE MARIA MUTUAL FUNDS
ABOUT YOUR FUNDS’ EXPENSES
(Unaudited) (Continued)

 

 

More information about the Funds’ expenses, including historical annual expense ratios, can be found in this report. For additional information on operating expenses and other shareholder costs, please refer to the Funds’ Prospectus.

 

 

Beginning
Account Value
January 1, 2021

Ending
Account Value
June 30, 2021

Net
Expense
Ratio
(a)

Expenses
Paid During
Period
(b)

Ave Maria Value Fund

Based on Actual Fund Return

$1,000.00

$1,224.60

1.00%

$5.52

Based on Hypothetical 5% Return (before expenses)

$1,000.00

$1,019.84

1.00%

$5.01

         

Ave Maria Growth Fund

       

Based on Actual Fund Return

$1,000.00

$1,137.60

0.91%

$4.82

Based on Hypothetical 5% Return (before expenses)

$1,000.00

$1,020.28

0.91%

$4.56

         

Ave Maria Rising Dividend Fund

     

Based on Actual Fund Return

$1,000.00

$1,163.90

0.91%

$4.88

Based on Hypothetical 5% Return (before expenses)

$1,000.00

$1,020.28

0.91%

$4.56

         

Ave Maria World Equity Fund

     

Based on Actual Fund Return

$1,000.00

$1,122.70

1.25%

$6.58

Based on Hypothetical 5% Return (before expenses)

$1,000.00

$1,018.60

1.25%

$6.26

         

Ave Maria Focused Fund

       

Based on Actual Fund Return

$1,000.00

$1,170.60

1.25%

$6.73

Based on Hypothetical 5% Return (before expenses)

$1,000.00

$1,018.60

1.25%

$6.26

         

Ave Maria Bond Fund

       

Based on Actual Fund Return

$1,000.00

$1,046.80

0.45%

$2.28

Based on Hypothetical 5% Return (before expenses)

$1,000.00

$1,022.56

0.45%

$2.26

 

(a)

Annualized, based on each Fund’s most recent one-half year expenses.

(b)

Expenses are equal to each Fund’s annualized net expense ratio multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period) for Actual Fund Return and Hypothetical 5% Return information, respectively.

 

71

 

 

 

AVE MARIA MUTUAL FUNDS

Other Information

(Unaudited)

 

 

A description of the policies and procedures the Funds use to determine how to vote proxies relating to portfolio securities is available without charge upon request by calling toll-free (888) 726-9331, or on the SEC’s website at www.sec.gov. Information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is also available without charge upon request by calling toll-free (888) 726-9331, or on the SEC’s website at www.sec.gov.

 

The Trust files a complete listing of portfolio holdings for each of the Funds with the SEC as of the end of the first and third quarters of each fiscal year as an exhibit on Form N-PORT. The filings are available free of charge, upon request, by calling (888) 726-9331. Furthermore, you may obtain a copy of the filings on the SEC’s website at www.sec.gov.

 

72

 

 

 

AVE MARIA MUTUAL FUNDS

Approval of Advisory Agreements

(Unaudited)

 

 

Ave Maria Value Fund, Ave Maria Growth Fund, Ave Maria Rising Dividend Fund, Ave Maria World Equity Fund and Ave Maria Bond Fund

 

At a meeting held on February 12, 2021 (the “Board Meeting”), the Board of Trustees of the Trust, including the Independent Trustees voting separately, reviewed and unanimously approved the continuation of the Advisory Agreements with Schwartz Investment Counsel, Inc. (the “Adviser”) (the “Advisory Agreements”) on behalf of each of the Ave Maria Value Fund, the Ave Maria Growth Fund, the Ave Maria Rising Dividend Fund, the Ave Maria World Equity Fund and the Ave Maria Bond Fund, each a series of the Trust (each, a “Fund,” and collectively, the “Ave Maria Mutual Funds” or “Funds”), for an additional one-year period. The Independent Trustees were advised and assisted throughout their evaluation by independent legal counsel experienced in matters relating to the investment management industry. The Independent Trustees met separately with their independent counsel to discuss the continuance of the Advisory Agreements, during which time, no representatives of the Adviser were present.

 

The Board retained Strategic Insight, an independent third-party provider of mutual fund data, to prepare an independent expense and performance summary for each Fund and comparable funds managed by other investment advisers identified by Strategic Insight. The Strategic Insight materials included information regarding advisory fee rates, other operating expenses, expense ratios, and performance comparisons to each Fund’s peer group and to a broad-based securities index. Prior to the Board Meeting, the Independent Trustees discussed separately with Strategic Insight the methodologies that it used to construct its report and the Morningstar, Inc. (“Morningstar”) categories that it identified to base its peer group comparisons for the Funds and other aspects of its report. The Independent Trustees also received and reviewed relevant information provided by the Adviser in response to requests of the Independent Trustees and their independent legal counsel to assist in their evaluation of the terms of the Advisory Agreements, including, among other things, information about the Adviser’s profitability with respect to each Fund, financial results and condition, management fee revenues and separately managed account fee schedules. The Board additionally considered the Funds’ portfolio management and compliance structure, brokerage commissions, turnover rates, and the ways in which the Funds realize economies of scale. The Board also received copies of the advisory agreements and a memorandum from the independent legal counsel to the Independent Trustees discussing the factors the Board should consider while evaluating the continuation of the Advisory Agreements.

 

The Independent Trustees noted that they had meet with the portfolio managers of each Fund at regularly scheduled meetings over the course of the year to discuss each Fund’s portfolio composition and the Adviser’s views of the economic, political and other developments affecting the financial markets in general and the performance of each Fund. They also considered that during each of those quarterly meetings, the Adviser had provided its views on the overall condition of the economy and the markets, including its

 

73

 

 

 

AVE MARIA MUTUAL FUNDS
APPROVAL OF ADVISORY AGREEMENTS
(Unaudited) (Continued)

 

 

rationale for disposing certain positions and purchasing others. As part of this process, the Trustees considered various factors, none of which by itself was considered dispositive, including :

 

 

the nature, extent and quality of the services provided by the Adviser (including any possible fall-out benefits);

 

 

the fees charged for those services and the Adviser’s profitability with respect to each Fund (and the methodology by which such profitability was calculated);

 

 

each Fund’s performance;

 

 

the extent to which economies of scale may be realized as a Fund grows; and

 

 

whether current fee levels reflect these economies of scale for the benefit of a Fund’s shareholders.

 

Nature, Extent and Quality of Services

 

In evaluating the nature, quality and extent of services provided by the Adviser, the Independent Trustees noted the Adviser’s statement that its responsibilities go beyond providing investment research and advice, and include various operational matters, including the selection of brokers and dealers to execute portfolio transactions and the monitoring of various compliance activities. The Independent Trustees also took into account the Adviser’s investment team, its ownership structure, the manner by which the Adviser conducts fundamental research and moral screening, its stability, the quality of its risk management program and the ability of the Adviser to differentiate the Ave Maria Mutual Funds from other types of mutual fund investments. The Independent Trustees noted that the Adviser has indicated to the Board that it remains focused on its core investment philosophy and has adhered to its stated approach in the portfolio management process for the Ave Maria Mutual Funds. The Independent Trustees also considered information provided by the Adviser regarding its business continuity and disaster recovery plan as well as information regarding how the Adviser functioned during the period of remote work environment caused by the global pandemic. Finally, the Independent Trustees examined whether the Adviser experienced any indirect benefit (i.e., fall-out benefits) for serving as investment adviser to the Funds, and after taking into account all this information, concluded that the nature, extent and quality of services provided by the Adviser to the Funds is satisfactory.

 

Investment Performance

 

The Independent Trustees considered the performance of each Fund against its Morningstar category peers for the one-year period ended November 30, 2020 and noted that each Fund placed in the fourth quartile of its Morningstar peer category. The Independent Trustees also compared the performance of each Fund over selected periods ended November 30, 2020 with its benchmark index, and noted that each Fund placed

 

74

 

 

 

AVE MARIA MUTUAL FUNDS
APPROVAL OF ADVISORY AGREEMENTS
(Unaudited) (Continued)

 

 

below the returns of its benchmark index during the one-year period, except for the Ave Maria Rising Dividend Fund, which outperformed its primary benchmark Index. In that regard, the Independent Trustees engaged in a discussion on the underperformance of the Funds against their respective benchmarks, and noted that management continues to keep the Board apprised of the possible reasons for the relative underperformance. The Independent Trustees concluded that the performance of the Funds was acceptable.

 

The Costs of Services and Profits to be Realized by the Adviser

 

The Trustees reviewed information provided by Strategic Insight on the advisory fees paid by each Fund and compared such fees to the advisory fees paid by similar mutual funds, as compiled by Morningstar. The Trustees also compared each Fund’s total expense ratio, of which a Fund’s advisory fee is a part, with expense ratios of representative funds within its Morningstar peer group for periods ended November 30, 2020. The Trustees noted that the Morningstar information showed that the total expense fee ratio for the Ave Maria Value Fund, Ave Maria Growth Fund and the Ave Maria Bond Fund was lower than the median total expense ratios of their respective Morningstar peers and the total expense ratio for the Ave Maria Rising Dividend Fund and Ave Maria World Equity Fund was higher than the median total expense ratios of their respective Morningstar peers. The Trustees considered that the Adviser has agreed to reduce the advisory fee rate of the Ave Maria Value Fund from 0.85% to 0.75% and the advisory fee rate of the Ave Maria Bond Fund from 0.30% to 0.25% on May 1, 2021, and that shareholders of these Funds should realize immediate benefits when the new advisory fee rates go into effect. After taking into account all this information, the Trustees found that the advisory fees and total expenses of each Fund are acceptable.

 

The Trustees also considered the Adviser’s costs of providing ongoing services to the Funds, the profits of the Adviser with respect to each Fund and the methodologies by which the Adviser calculated that profitability information, and concluded that the profits of the Adviser are reasonable and represent a fair and entrepreneurial profit in light of the quality and scope of services that are provided to the Funds.

 

The Extent to Which Economies of Scale Would be Realized and Whether Advisory Fee Levels Reflect these Economies of Scale

 

The Independent Trustees considered the extent to which shareholders have realized economies of scale with respect to the management of the Funds. The Trustees discussed the Adviser’s history of waiving the expenses of certain Funds and reducing the advisory fees of certain other Funds in order to establish a lower total annual operating expense ratio for those Funds. The Independent Trustees also noted that the Adviser had agreed to reduce the advisory fee rates of the Ave Maria Value Fund and Ave Maria Bond Fund effective May 1, 2021. They noted that the Adviser builds economies of scale into its advisory fee structures by keeping overall expenses down as a Fund grows and seeks

 

75

 

 

 

AVE MARIA MUTUAL FUNDS
APPROVAL OF ADVISORY AGREEMENTS
(Unaudited) (Continued)

 

 

additional economies of scale through its asset gathering efforts on behalf of the Funds. The Trustees concluded that the extent to which shareholders are achieving economies of scale as the Funds grow is acceptable.

 

Conclusion

 

The Board, including the Independent Trustees, subsequently concluded that the existing Advisory Agreements are fair and reasonable and voted to approve the continuance of the Advisory Agreements. In reaching their decision regarding the continuation of the Advisory Agreements, the Board, including the Independent Trustees, did not identify any single factor or particular information as controlling, and each Trustee may have attributed different weights to certain factors. Rather, the Trustees concluded, in light of a weighing and balancing of all factors considered, that it was in the best interests of each Fund and its shareholders to renew the Advisory Agreements for an additional annual period.

 

76

 

 

 

 

 

 

(b)Not applicable.

 

Item 2.Code of Ethics.

 

Not required

 

Item 3.Audit Committee Financial Expert.

 

Not required

 

Item 4.Principal Accountant Fees and Services.

 

Not required

 

Item 5.Audit Committee of Listed Registrants.

 

Not applicable

 

Item 6.Schedule of Investments.

 

(a)Not applicable [schedule filed with Item 1]

 

(b)Not applicable

 

Item 7.Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

 

Not applicable

 

Item 8.Portfolio Managers of Closed-End Management Investment Companies.

 

Not applicable

 

Item 9.Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

 

Not applicable

 

Item 10.Submission of Matters to a Vote of Security Holders.

 

The registrant’s Nominating and Governance Committee shall review shareholder recommendations to fill vacancies on the registrant’s board of trustees if such recommendations are submitted in writing, addressed to the Committee at the registrant’s offices and meet any minimum qualifications adopted by the Committee. The Committee may adopt, by resolution, a policy regarding its procedures for considering candidates for the board of trustees, including any recommended by shareholders.

 

 

 

Item 11.Controls and Procedures.

 

(a) Based on their evaluation of the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) as of a date within 90 days of the filing date of this report, the registrant’s principal executive officer and principal financial officer have concluded that such disclosure controls and procedures are reasonably designed and are operating effectively to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to them by others within those entities, particularly during the period in which this report is being prepared, and that the information required in filings on Form N-CSR is recorded, processed, summarized, and reported on a timely basis.

 

(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the 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.Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

 

Not applicable.

 

Item 13.Exhibits.

 

File the exhibits listed below as part of this Form. Letter or number the exhibits in the sequence indicated.

 

(a)(1) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit: Not required

 

(a)(2) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act (17 CFR 270.30a-2(a)): Attached hereto

 

(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act (17 CFR 270.23c-1) sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons: Not applicable

 

(a)(4) Change in the registrant’s independent public accountants. Not applicable

 

(b) Certifications required by Rule 30a-2(b) under the Act (17 CFR 270.30a-2(b)): Attached hereto

 

Exhibit 99.CERTCertifications required by Rule 30a-2(a) under the Act

 

Exhibit 99.906CERTCertifications required by Rule 30a-2(b) under the Act

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

(Registrant) Schwartz Investment Trust    
       
By (Signature and Title)* /s/ George P. Schwartz  
    George P. Schwartz, President and Principal Executive Officer  
       
Date August 23, 2021    
       
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/ George P. Schwartz  
    George P. Schwartz, President and Principal Executive Officer  
       
Date August 23, 2021    
       
By (Signature and Title)* /s/ Timothy S. Schwartz  
    Timothy S. Schwartz, Treasurer and Principal Financial Officer  
       
Date August 23, 2021    

 

*Print the name and title of each signing officer under his or her signature.