CM Energy Industry Update - April 2015

Over the past nine months, the decline in the price of oil, as well as the decline in the stock prices of many energy and energy-related service companies, has caused a great deal of uncertainty for investors. The big fear among many investors today is that the U.S. energy industry will experience a repeat of the 1986 oil crash, which lasted a decade in North America. We believe it is the fear of this “repeat” that has brought many energy company valuations down to levels we have not seen since that time.

Our research and analysis will show:

• Spare capacity throughout today’s energy markets is significantly different than in past cycles.

• If you look out over the next few years, the energy market appears to be much tighter than the general investing public believes.

• In our opinion, the fear of a prolonged disaster scenario for the energy sector is overblown and largely discounted in current stock prices, presenting an opportunity for very attractive returns in many energy-related companies.

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Disclosures: This article is not financial advice or an offer or solicitation to sell any product. CM reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.

The performance numbers referenced in this article are from the CM Value I (All-Cap Value) composite. This strategy is a time-weighted, total-return composite that primarily invests in stocks, bonds, and cash. The focus of this composite is to find undervalued securities that over time will produce above average returns with a lower degree of risk than that of the general market. Performance data quoted represents past performance.

Current performance may be lower or higher than the performance data quoted. Past performance of markets, strategies, composites, or any individual securities is no guarantee of future results. The performance of accounts in the composite may be materially different at any given time. Differences that may affect investment performance include but are not limited to cash flows, inception dates, historical prices, asset size, market conditions, portfolio holdings, and fees. The U.S. Dollar is the currency used to express performance. Performance figures reflect the reinvestment of dividends and other earnings. Positions within the composite may not be the same from one account to the next. Individual securities within the composite may be traded at different times as well as receive different execution prices. In addition, accounts within the composite may be pursuing similar investment strategies, but may have different investment restrictions.

Investment in the CM Value I composite is subject to investment risks, including, without limitation, market risk, interest rate risk, management style risk, business risk, sector risk, small cap risk, and other risks related to equity securities CM claims compliance with the Global Investment Performance Standards ("GIPS®"), examined from the strategy's inception, September 16, 1974, through June 30, 2014. This performance was prepared by CM and presented to and examined by Ashland Partners & Company, LLP. Ashland Partners continues to verify the compliance of CM with the requirements of GIPS® on a firm-wide basis each calendar quarter. This GIPS® verification and performance examination is generally one to two quarters in arrears of the most recent performance information presented. Thus, while performance figures shown after the verification date are believed to be accurate, they are preliminary and have not yet been examined.

Certain statements included herein contain forward-looking statements, comments, beliefs, assumptions, and opinions that are based on CM's current expectations, estimates, projections, assumptions and beliefs. Words such as "expects," "anticipates," "believes," "estimates," and any variations of such words or other similar expressions are intended to identify such forward-looking statements.

These statements, beliefs, comments, opinions and assumptions are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in, or implied by, such forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which reflect CM's judgment only as of the date hereof. CM disclaims any responsibility to update its views, as well as any of these forward-looking statements to reflect new information, future events or otherwise.

CM is an independent registered investment adviser. Employees of CM may own the securities referenced herein. If you should have any questions regarding the contents of this article or wish to receive our form ADV Part 2 or our complete GIPS performance examination, please contact CM at its corporate office in Austin, Texas at 1-800-664-4888. We can also be reached on the web at www.centman.com or at 805 Las Cimas Parkway, Suite 430, Austin, Texas, 78746. CM-14-18.