Integrity Mutual Funds
Shares Outstanding: 14.46M
Integrity Mutual Funds, Inc., through its subsidiaries, provides investment management, distribution, shareholder services, fund accounting, and other related administrative services to open end investment companies in the United States. The company also offers order processing, regulatory oversight, concession processing, and other related services to registered securities representatives transacting securities business for their clients. In addition, it provides shareholder record-keeping services, as well as acts as transfer agent and dividend-paying agent, as well as broker-dealer for mutual funds, insurance products, and other securities. The company was founded in 1987 and is headquartered in Minot, North Dakota with additional office in Huntington, New York.
Message from the President
From the President
Managed assets ended the year at over $442 million, with gross mutual fund share sales nearly doubling over 2005. Strong sales growth is attributed to a team of 12 sales professionals living and wholesaling our funds throughout the United States. Leading the way was Integrity High Income Fund, with gross sales of over $96 million.
The March 2006 editions of Money magazine and Kiplinger’s Personal Finance magazine ranked Integrity High Income Fund the #1 high-yield bond fund in the nation. Additionally, the Fund ended 2005 in the top 1% (among 520 funds) in Morningstar’s High Yield Bond category. We continue to actively promote our funds nationwide to registered representatives, registered investment advisors, and the media.
Our retail brokerage subsidiary, Capital Financial Services, continues to evolve into one of the finest independent broker dealers in the country. We have established a reputation for providing great service, competitive payouts, strong compliance, a great product line, and technology that gives us an edge on the competition. Our recruiting efforts have been and continue to be successful, due to our advancements in technology and our sensitivity in servicing our representatives.
With over 300 producing representatives on board, CFS continues to add new representatives at a constant rate. As CFS’ representative count grows, so do revenues. With just 13 people in operations and estimates of $27 million in gross commission revenues for 2007, CFS continues to be an efficient and profitable segment of our company.
The share price of IMFD common shares reflected this forward momentum, ending the year at $0.60 per share, up 76% from the prior year-end.
Recent years have brought forth one-time adjustments that have significantly eroded profitability, and we continue to be challenged with cost containment issues for compliance and distribution related expenses. To meet this challenge, we are focused on growing the company through intelligent acquisitions, strategic partnerships and disciplined expense management. We will continue rolling out unique new mutual fund product offerings that meet investor demand in the marketplace and will continue to seek out new strategic partnerships with specialty asset managers that offer a unique story and can contribute to gathering assets.
On February 1, 2007, Robert Walstad, Integrity’s founder, chief executive officer and chairman of the board of directors, announced his retirement, ending 20 years of leadership and dedication to the company. Bob incorporated ND Holdings, Inc. (now Integrity Mutual Funds, Inc.) in 1987 and has overseen its growth into a prominent financial services firm. Without Bob’s vision and steadfast dedication, Integrity Mutual Funds would not be where it is today. We wish him good health and happiness in his retirement.
As always, growth and profitability continue to be our primary mission, and I am confident that we have the right team of professionals in place to accomplish that mission. Our board of directors remains vigilant in its oversight and supportive of our mission. Together, we will endeavor to make 2007 a productive and prosperous year.
Mark R. Anderson
President & CEO