Akre Focus Fund’s Semi-Annual Report Highlights Uncertain Climate

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Akre Focus Fund’s semi-annual letter to shareholders.

Fellow Shareholders:

What a start to 2013! By the Ides of March (March 15, 2013), the market, as represented by the S&P 500 (INDEXSP:.INX), had experienced what has historically been essentially an average year’s total performance, approximately 10%! As you have come to expect from us, we make no attempt to forecast where the market is headed for the balance of the year. Here is what we do know for certain: We seek to invest in companies which are growing in real economic value per share every daywithoutregard towhat the market says they are worth.

All that aside, this letter is about Akre Focus Fund’s fiscal six month position ending January 31st, 2013, as our fiscal year ends on July 31st. At each turn we seem to find ourselves faced with new uncertainties – at the time of our last annual letter the country was fixated on the national election, which was followed by the fiscal cliff debate, then the debt ceiling, elections in Italy, etc. More recently, the bailout in Cyprus, a nation that accounts for less than 1% of Eurozone GDP, has the world financial markets on alert. Each has real relevance, but of course we can have no impact on the outcomes of any of these events. So here we are, just as before the election last year, working hard to create an outcome consistentwith your expectations, regardless of external events.

Included in this group are three financial businesses: LPL Financial Holdings Inc (NASDAQ:LPLA), TD Ameritrade Holding Corp. (NYSE:AMTD) and Markel Corporation (NYSE:MKL). The first two relate to servicing the individual investor- in LPL Financial Holdings, Inc.’s case through back-office software and product platforms for individual advisors; and in TD Ameritrade Holding Corp.’s case through low-cost brokerage and advice services which we believe are valuable. The last, Markel Corp. (MKL), is a specialty property and casualty insurer which we believe is positioned exceptionally well for what lies ahead, including the possibility of higher interest rates, firming of insurance pricing, growing free cash flow from its Markel Ventures segment, and lastly the opportunity for a more robust management of its balance sheet. In other portfolios we manage, we have owned shares of Markel Corp. for more than twenty years. The only other business included in the top ten which we have not previously mentioned is Colfax Corp (NYSE:CFX). This is a manufacturing company whose business model is to acquire other manufacturing business and rationalize them in such a way as to importantly improve their operating results. The management of Colfax Corp. has demonstrated this skill at another company with which we are familiar, and we believe we have an important opportunity here, hence a top ten holding.

I referred above to creating outcomes consistent with your expectations. From our perspective this means that we are always working to identify and own at the correct starting price businesses which have the potential to compound the owners’ capital at above average rates; which are run by exceptional managers who view public shareholders as partners; and where both a history of and an opportunity for superb reinvestment exists. The “Three-Legged Stool” if you will. We believe this can provide an opportunity to compound “our” capital at above average rates while incurring below average risks.

It is worth noting that our returns from inception have been achieved while holding substantial cash, cash equivalents as well as cash substitutes. Cash and equivalents combined with cash substitutes have averaged nearly 30% of our portfolio from our starting date of August 31, 2009. At the end of January 2013 the cash and cash equivalents component was 11% and including cash substitutes the total was 19%. Finally, it is worth noting that by early March, the Fund surpassed $1.5 billion in net assets. Thank you again for your continued supportin our efforts on your behalf.

Akre Capital Management, LLC

A theme which continues to have resonance with us is identifying businesses whose business models are designed to help the consumer stretch each dollar they have for spending on necessities. In this vein we continue to favor both Ross Stores, Inc. (NASDAQ:ROST) and Dollar Tree, Inc. (NASDAQ:DLTR), two businesses which have already added significant value to the fund. We also continue to place great emphasis on businesses which have real pricing power, and in this category we include Mastercard Inc (NYSE:MA), Moody’s Corporation (NYSE:MCO), Visa Inc (NYSE:V) and American Tower Corp (NYSE:AMT) among others. During the six month period ending January 31st, we selectively added or initiated positions in several businesses which we found simply “too cheap” at the time, and some of these may not necessarily be thought of as long term holdings. Timewill tell.

Our largest positions as of January 31, 2013 were in order:

Mastercard, Inc.

Moody’s Corp.

Markel Corp.

Ross Stores, Inc.

DollarTree, Inc.

AmericanTower Corp.

Visa, Inc.

Colfax Corp.

LPL Financial Holdings, Inc.

TD Ameritrade Holding Corp.

In our continuing desire to communicate with our fellow shareholders, we’d like to invite you to a conference call, scheduled for April 25, 2013 at 4 PM Eastern Time.

On the call we will discuss our outlook, provide some more detail about our investments, and answer any questions you may have. We look forward to our chat on April 25th.

Akre Focus Fund Conference CallInformation: Date: April 25, 2013 Time: 4:00 pm ET DialIn: (877) 509-7719 Conference ID: 27649161

We would appreciate having your questions in advance by email to [email protected] by April 24, 2013, but will also take questions on the conference call.

Opinions expressed are those of the advisor and are subject to change at any time, are not guaranteed and should not be considered investment advice.

Mutual fund investing involves risk. Principal loss is possible. The Fund is non-diversified, meaning it may concentrate its assets in fewer individual holdings than a diversified fund. Therefore, the Fund is more exposed to individual stock volatility than a diversified fund. The Fund investsin small- and medium-capitalization companies, which involve additionalriskssuch aslimited liquidity and greater volatility than larger capitalization companies.

Past performanceis no guarantee of futureresults.

The Fund’s investment objectives, risks, charges and expenses must be considered carefully before investing. The summary and statutory prospectuses contain this and other important information about theinvestmentcompany and it may be obtained by calling (877) 862-9556 or visiting www.akrefund.com. Read it carefully before investing.

The S&P 500® is a broad based unmanaged index of 500 stocks, which is widely recognized as representative of the equity marketin general. Itis not possible to invest directly in an index.

Free cash flow measures the cash generating capability of a company by adding non-cash charged (e.g. depreciation) and interest expense to pretax income.

Fund holdings are subject to change and are not recommendations to buy or sell any security. See the Schedule of Investmentsforthe Fund holdings.

The Akre Focus Fund is distributed by Quasar Distributors, LLC

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