FPA Perennial Fund, Inc.

Objective:

FPA Perennial Fund, Inc. (FPPFX) seeks long-term capital growth by investing primarily in small and mid-cap stocks.

  • Buy superior businesses at reasonable prices
  • Consistent disciplined philosophy since fund inception
  • Portfolio weightings reduces benchmark correlation
  • Concentrated portfolio
  • Very low portfolio turnover

Philosophy:

The Fund's managers believe that long-term ownership of superior companies produces high shareholder returns. These businesses typically exhibit outstanding returns on capital combined with fortress balance sheets. Their business models are easily understood, benefit from strong market positions or other competitive strengths, and are executed by capable management teams. Through a patient approach, the Fund attempts to take advantage of price opportunities or market inefficiencies to periodically acquire the securities of such companies at attractive prices. The Fund's approach does not rely on market or economic forecasts, rather on the selection of individual businesses and a disciplined judgment of the relative attractiveness of the market valuation of those businesses. Due to its bottom up security selection process and relative concentration of holdings, the Fund varies widely from benchmark security and sector weightings.


As of April 30, 2012

Comparative Performance

Fund/Index Month    YTD 1 Year 3 Years** 5 Years** 10 Years** 15 Years**
FPA Perennial (NAV)  -1.38% 10.18%  -3.14% 19.49% 4.08% 7.25% 11.11%
FPA Perennial (with load^)  -6.56%   4.39% -8.23% 17.36% 2.96% 6.67% 10.71%
Russell 2500 Index  -0.73%  12.16%   -2.23% 22.13% 2.35% 7.44%   8.80%
S&P 500 Index  -0.63%  11.88%
   4.76% 19.46% 1.01% 4.71%   5.65%
^Sales charges vary depending in levels of investment. See prospectus.
** Annualized

After Tax Returns Historical Performance

Portfolio Structure *

CASH PLUS LIQUIDITY:
5.6%
TOTAL NET ASSETS:
$258 Million
TOTAL SECURITIES IN PORTFOLIO
37


Top Sectors*


Top Holdings*

O'Reilly Automotive   6.8%   Life Technologies   4.7%
Carmax   5.9%   Copart   4.1%
ScanSource   5.5%   FMC Technologies
   4.0%
Wabco
   5.3%   Noble   3.7%
Signet Jewelers
   5.3%   Zebra Technologies   3.6%
 
Top 10 Holdings represent 48.9% of Total Net Assets

Portfolio Holdings

* As of March 31, 2012. Past performance is not indicative of future performance. The returns shown for the Fund are calculated at both net asset value (NAV) and reflecting deduction of the maximum sales charge of 5.25% (with load). The Russell 2500 Index consists of the 2,500 smallest companies in the Russell 3000 total capitalization universe. This index is considered a measure of small to medium capitalization stock performance. S&P 500 Index includes a representative sample of 500 leading companies in leading industries of the U.S. economy. The index focuses on the large-cap segment of the market, with over 80% coverage of U.S. equities, but is also considered a proxy for the total market.These indices do not reflect any commissions or fees which would be incurred by an investor purchasing the stocks they represent. The performance of the Fund and of the Averages is computed on a total return basis which includes reinvestment of all distributions.


As of April 30, 2012
 
(NAV) 1 Year 5 Years 10 Years
Before Tax -3.14% 4.08% 7.25%
After Tax on Distribution* -3.14% 3.69% 6.82%
 
After Tax on Distribution and Sale of Fund Shares* -2.67% 3.38% 6.23%
 
(With Load) 1 Year 5 Years 10 Years
Before Tax -8.23% 2.96% 6.67%
After Tax on Distribution* -8.23% 2.58% 6.24%
 
After Tax on Distribution and Sale of Fund Shares* -6.99% 2.41% 5.71%

**After -tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes.  Actual after-tax returns depend upon an investor's tax situation and may differ from those shown.  After-tax returns presented here are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or IRAs.

Performance has been calculated on a total return basis, which combines principal and dividend income changes for the periods shown. Principal changes are based on the difference between the beginning and closing net asset values for the period and assume reinvestment of all dividends and distributions paid. The maximum sales charge of 5.25% and all applicable expenses such as advisory fees have been included in calculating the after tax (with load) performance. Total return calculations are based on a $10,000 investment. This data represents past performance and investors should understand that investment returns and principal values fluctuate, so that when you redeem your investment it may be worth more or less than its original cost. The Prospectus details the Fund"s objective and policies, sales charges, and other matters of interest to the prospective investor. Please read this Prospectus carefully before investing.