1999 Turner Funds Semiannual Report
(Unaudited)
Portfolios of the TIP Funds and Alpha Select Funds
Turner Large Cap Growth Equity Fund
Turner Growth Equity Fund
Turner Midcap Growth Fund
Turner Small Cap Growth Fund
Turner Micro Cap Growth Fund
Turner Short Duration Government Funds-Three Year Portfolio
Turner Short Duration Government Funds-One Year Portfolio
"The story for the six-month period ended March 31 is one of outperformance
by six of our seven stock and bond mutual funds. Even more important, the
longer-term record (which is the true measure of investment success) is equally
admirable: six of our funds have outperformed since their inceptions. In short,
the story of the Turner Funds is one of solid investment success over time. It
is a story that should bring cheer to the shareholders who have entrusted us
with their assets."
Letter to shareholders, page 2
<PAGE>
Contents
1 Total returns of Turner Funds
2 Letter to shareholders
5 Investment review:
Turner Large Cap Growth Equity Fund
7 Investment review:
Turner Growth Equity Fund
9 Investment review:
Turner Midcap Growth Fund
11 Investment review:
Turner Small Cap Growth Fund
13 Investment review:
Turner Micro Cap Growth Fund
15 Investment review:
Turner Short Duration Government
Funds-Three Year Portfolio
17 Investment review: Turner Short Duration Government Funds-One Year Portfolio
19 Financial statements
48 Fund trustees
Turner Funds
The Turner Funds, Portfolios of both the TIP Funds and Alpha Select Funds, offer
a series of seven no-load mutual funds to individual and institutional
investors. The minimum initial investment in a Turner Fund for regular accounts
is $2,500 and $2,000 for individual retirement accounts. The minimum amount for
subsequent investments is $500.
Turner Investment Partners, Inc., based in Berwyn, Pennsylvania, serves as the
investment adviser to the Turner Funds. The firm, founded in 1990, invests more
than $3 billion in equity, fixed-income, and balanced portfolios on behalf of
individuals and institutions.
Shareholder services
Turner Funds shareholders receive annual and semiannual reports and quarterly
account statements. Shareholders who have questions about their accounts may
call a toll-free telephone number, 1-800-224-6312. Or they may write to Turner
Funds, Box 419805, Kansas City, Missouri 64141.
<PAGE>
Performance
Total returns of Turner Funds*
Periods ending March 31, 1999
<TABLE>
<CAPTION>
Past six Past 12 Past three Past five Since
months months years years inception
(annualized) (annualized) (annualized)+
Equity
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Turner Large Cap
Growth Equity Fund 43.87% 41.20% -- -- 40.07%
Lipper Growth Funds Average 28.23 13.56 -- -- 21.32
S&P 500 Index 27.34 18.46 -- -- 27.56
Russell Top 200 Growth Index 35.72 33.61 -- -- 35.31
- ---------------------------------------------------------------------------------------------------------------------------
Turner Growth Equity Fund 35.81 33.02 31.16% 24.71% 20.37
Lipper Capital Appreciation
Funds Average 28.71 11.84 15.05 16.49 13.83
S&P 500 Index 27.34 18.46 28.08 26.25 20.14
Russell 1000 Growth Index 34.81 28.11 31.02 25.70 20.80
- ---------------------------------------------------------------------------------------------------------------------------
Turner Midcap Growth Fund 52.78 34.80 -- -- 37.74
Lipper Mid-Cap Funds Average 23.42 0.24 -- -- 13.31
Russell Midcap Growth Index 30.79 8.90 -- -- 18.77
- ---------------------------------------------------------------------------------------------------------------------------
Turner Small Cap Growth Fund 32.20 0.32 15.57 26.67 24.99
Lipper Small Cap
Funds Average 12.53 (15.48) 8.03 12.11 13.91
Russell 2000 Growth Index 21.56 (11.04) 5.76 10.76 9.00
- ---------------------------------------------------------------------------------------------------------------------------
Turner Micro Cap Growth Fund 45.95 33.52 -- -- 40.01
Lipper Micro Cap Funds Average 21.08 (12.35) -- -- (6.63)
Russell 2000 Growth Index 21.56 (11.04) -- -- (6.75)
- ---------------------------------------------------------------------------------------------------------------------------
Fixed income
- ---------------------------------------------------------------------------------------------------------------------------
Turner Short Duration
Government Funds-
Three Year Portfolio 1.33 6.16 6.45 6.56 6.31
Lipper Short/Intermediate U.S.
Government Funds Average 0.34 5.33 5.92 5.78 5.38
Lehman Brothers 1-3 Year
U.S. Government Bond Index 1.38 6.09 6.32 6.19 5.98
- ---------------------------------------------------------------------------------------------------------------------------
Turner Short Duration
Government Funds-
One Year Portfolio
(Institutional Class) 2.74 5.92 6.18 6.26 6.18
Lipper Ultra-Short Obligation
Funds Average 2.21 5.22 5.60 5.46 5.39
Merrill Lynch Three-Month
U.S. Treasury Bill Index 2.19 4.98 5.23 5.28 5.25
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Past performance is no guarantee of future results. The investment return and
principal value of an investment will fluctuate, so that an investor's shares,
when redeemed, may be worth more or less than their original cost.
+ The inception dates for each Turner Fund are as follows: Turner Large Cap
Growth Equity Fund, February 1, 1997; Turner Growth Equity Fund, March 11, 1992;
Turner Midcap Growth Fund, October 1, 1996; Turner Small Cap Growth Fund,
February 7, 1994; Turner Micro Cap Growth Fund, March 1, 1998; Turner Short
Duration Government Funds-Three Year Portfolio, March 1, 1994; and Turner Short
Duration Government Funds-One Year Portfolio (Institutional Class Shares), March
1, 1994.
TURNER FUNDS 1999 SEMIANNUAL REPORT | 1
<PAGE>
Letter to shareholders
- -------------------------------------------------------------------------------
To our shareholders
Active management--the traditional investment approach of buying and selling
stocks in an effort to continuously capitalize on the best investment
opportunities--has acquired a bad name in recent years. One reason: the mutual
funds of most active mangers have failed to beat their benchmark on indices.
Over the past year, for example, fewer than 20% of actively managed diversified
U.S. stock funds beat the S&P 500 Index, according to Lipper Inc. data.
Indeed, much of the allure of index funds--funds that invest by weighting a
portfolio to match an index so as to simply replicate its performance--can be
attributed to the failure of investment managers to outperform the benchmarks.
As a result investors have adopted an if-you-can't-beat-'em, join-'em attitude:
why pay extra fees for active management when it's underperforming the simple,
more economical alternative of "passive" indexing?
Our story: solid success
Active management can't beat indexing? That's not true for the Turner Funds. The
story for the six-month period ended March 31 is one of outperformance by six of
our seven stock and bond mutual funds (see table, page 1). Even more important,
the longer-term record (which is the true measure of investment success) is
equally admirable: six of our funds have outperformed since their inceptions. In
short, the story of the Turner Funds is one of solid investment success over
time. It is a story that should bring cheer to the shareholders who have
entrusted us with their assets.
It's said that the hardest thing about being successful is continuing to be
successful. In the future we shall seek to continue succeeding by doing better
what we do best: to scrupulously follow our investment disciplines, to refine
those disciplines whenever possible, and to capitalize on the ever-changing
opportunities in the capital markets. For details on how our funds fared in
capitalizing on the opportunities that were presented in the near term, over the
past six months, see the Investment review section beginning on page 5. Briefly,
here are the results for that time period for each of our funds:
o The Turner Large Cap Growth Equity Fund, benefiting from the market's
continued preference for the stocks of large companies that are household names
like Microsoft, General Electric, and Pfizer, returned 43.87%. Its margins of
outperformance: 16.53 percentage points over the S&P 500 Index and 8.15
percentage points over the Russell Top 200 Growth Index of the biggest of the
big growth stocks.
o The Turner Growth Equity Fund gained 35.81%. Its margins of outperformance:
8.47 percentage points over the S&P 500 Index and 1.00 percentage point over the
Russell 1000 Growth Index.
o The Turner Midcap Growth Fund had a stellar six months, advancing 52.78%--the
best absolute showing of any of our mutual funds. Its margin of outperformance:
21.99 percentage points over the Russell Midcap Growth Index.
o The Turner Small Cap Growth Fund continued to reinforce its status as one of
the elite small-cap funds, with a return of 32.20%. Its margin of
outperformance: 10.64 percentage points over the Russell 2000 Growth Index.
o The Turner Micro Cap Growth Fund, our newest fund, which opened on March 1,
1998, widened its already sizable performance advantage over the Russell 2000
Growth Index. Micro Cap Growth soared 45.95%. Its margin of outperformance:
24.39 percentage points--the best relative result of any of our mutual funds.
o The Turner Short Duration Government Funds-Three Year Portfolio did a worthy
job of coping with rising interest rates and declining bond prices, advancing
1.33%. That return fell just slightly short--0.05 percentage points short, to be
precise--of the performance of the fund's benchmark, the Lehman Brothers 1-3
Year U.S. Government Bond Index.
o The Turner Short Duration Government Fund-One Year Portfolio's modest maturity
average provided excellent protection from the negative effects of rising rates.
The fund's Institutional Class returned 2.74%. Its margin of outperformance:
0.55 percentage points over the Merrill Lynch Three-Month U.S. Treasury Bill
Index.
2 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
Funds rank high
Altogether, our funds continued to bolster their footholds in the upper reaches
of the mutual-fund summit. In light of our organizational mission to provide
clients with consistently superior investment returns, we take a singular pride
in how our funds rank versus their peers, according to Lipper Inc. (see table,
below).
In short, for the longest applicable time spans, all the Turner Funds rank no
lower than the top 13th percentile versus their peers, according to the Lipper
ratings.
Among other things, our stock funds drew strength from the popularity of growth
investing. Beyond that, our funds profited from superior stock selection on our
part, which we think is a testament to the effectiveness of our investment
process, which employs a blend of quantitative, fundamental, and technical
methods. Also, our performance was enhanced by the remarkable strength of the
American economy, now in its eighth consecutive year of expansion; American
corporations' global profit leadership and surpassing proficiency at production,
management, and marketing; and an inflation rate that continues to be markedly
below the historical average.
About the stock market's prospects, we think as long as earnings hold up
reasonably well (and we think they will generally), this remarkable bull of a
Lipper Inc. performance rankings of mutual funds
Periods ending March 31, 1999
<TABLE>
<CAPTION>
One Two Five Seven
year years years years
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Growth Funds
Turner Large Cap Growth Equity Fund
Ranking vs. competitors 40/1,022 25/787 -- --
Percentile ranking 3 3 -- --
- ---------------------------------------------------------------------------------------------------------------------------
Capital Appreciation Funds
Turner Growth Equity Fund
Ranking vs. competitors 44/251 24/213 13/99 8/64
Percentile ranking 17 11 13 12
- ---------------------------------------------------------------------------------------------------------------------------
Mid-Cap Funds
Turner Midcap Growth Fund
Ranking vs. competitors 13/301 3/279 -- --
Percentile ranking 3 1
- ---------------------------------------------------------------------------------------------------------------------------
Small-Cap Funds
Turner Small Cap Growth Fund
Ranking vs. competitors 97/664 35/494 1/230 --
Percentile ranking 14 7 1 --
- ---------------------------------------------------------------------------------------------------------------------------
Micro-Cap Funds
Turner Micro Cap Growth Fund
Ranking vs. competitors 3/48 -- -- --
Percentile ranking 6
- ---------------------------------------------------------------------------------------------------------------------------
Short-Intermediate U.S. Government Funds
Turner Short Duration Government Funds -
Three Year Portfolio
Ranking vs. competitors 9/97 45/88 7/52 --
Percentile ranking 9 51 13 --
- ---------------------------------------------------------------------------------------------------------------------------
Ultra-Short Obligation Funds
Turner Short Duration Government Funds -
One Year Portfolio (Institutional Class)
Ranking vs. competitors 3/27 4/25 2/15 --
Percentile ranking 11 16 13 --
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
Source: Lipper Inc.
TURNER FUNDS 1999 SEMIANNUAL REPORT | 3
<PAGE>
Letter to shareholders
- -------------------------------------------------------------------------------
market should continue raging. Also, we think the above-average market
volatility--a common metaphor for the intensity of market moves recently has
been the roller coaster--will continue to be in evidence. We think any
corrections (market declines of 10%) will be concentrated and followed by the
market regaining its momentum.
Short maturities advantageous
Our bond funds coped admirably with a split personality by the bond market in
the past six months. Early in the period the bond market was in the grip of a
flight to quality, with Treasury securities being the prime beneficiaries of
that trend. Beginning in November, however, a flight to yield prevailed. The
premium yields of even highly-rated corporate and mortgage-backed securities
that no one wanted earlier were now much prized. That schizophrenia, moreover,
was compounded by a significant rise in interest rates. At the end of March,
rates at all maturities were 0.14 to 1.06 percentage points higher than they
were last October 1. In such an environment, shorter maturities--which are less
sensitive to rate changes--are the best investments, and the short average
maturities of our two bond mutual funds proved helpful. Also helpful were our
high average credit quality and our mix of Treasury, collateralized
mortgage-obligation, and asset-backed securities.
Even with their recent rise, interest rates are still relatively low by
historical standards. Because we think it will be difficult for interest rates
to move significantly lower, we think an investment strategy like ours should
fare well over the next six months. With just 0.27 percentage points separating
two-year and ten-year rates, we think it makes a great deal of sense to stick
with short maturities; our research indicates that the two-year note provides
more than 90% of the yield of the 10-year note with less than 50% of the risk.
With the continuing support of our shareholders and staff, we look forward to
further success in the months and years ahead. As always, we remain committed to
our mission of delivering superior investment returns and service to you. And as
always, we welcome your questions or comments.
/s/ Bob Turner
----------------
Robert E. Turner
Chairman
TIP Funds and Alpha Select Funds
April 5, 1999
[PHOTO]
Bob Turner
4 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Turner Large Cap Growth Equity Fund
Total return
Six-month period ending March 31, 1999
- --------------------------------------------------------------------------------
Turner Large Cap Growth Equity Fund 43.87%
Lipper Growth Funds Average 28.23
S&P 500 Index 27.34
Russell Top 200 Growth Index 35.72
- --------------------------------------------------------------------------------
Like a Sherman tank, large-cap growth stocks continued to bulldoze over anything
in their path during the past six months: concerns about corporate
profitability, lofty stock-market valuations, rising interest rates, Russia's
massive debt default, Asian and Latin American recessions, even the impeachment
of President Clinton. As has been the case for the past five years, the Russell
Top 200 Growth Index of the biggest stocks powered its way to yet another
outsized gain: 35.72%--a return, incredibly, more than three times the size of
the historical average gain of large stocks for an entire year. It was the best
performance of any general index in any capitalization segment.
The Turner Large Cap Growth Equity Fund (formerly the Turner Ultra Large Cap
Growth Fund) did notably better, soaring 43.87%--a performance edge of 8.12
percentage points over the Russell Top 200 Growth and 16.53 percentage points
over the broader-based S&P 500 Index.
Large Cap's results by sector were exceptional. Nine of our 10 sector
investments outperformed their corresponding Russell Top 200 Growth Index
sectors. Strong returns in the technology, consumer-discretionary/services,
producer-durables, and utilities/communication sectors accounted for most of the
performance premium. Our sole underperforming sector was energy, where we failed
to match the strong gains sparked by a rise in oil prices late in the period.
Among individual stocks, our biggest winners (up 70% or more) included EMC and
Microsoft in technology; Amgen in health care; America Online, Home Depot, and
Wal-Mart Stores in consumer discretionary/services; Applied Materials in
producer durables; and MCI WorldCom in utilities/communication.
Over the past six months, the big surprise was the resiliency of large stocks in
the face of weaker earnings. We think the big surprise in 1999 may be that
corporate America's earnings will be stronger than anticipated. As long as
Growth of a $10,000 Investment in the
Turner Large Cap Growth Equity Fund:
February 1, 1997-March 31, 1999*
[GRAPHIC]
In the printed version of the document,
a line graph appears which depicts the following plot points:
<TABLE>
<CAPTION>
Russell Top 200 Turner Large Cap Growth
Growth Index S&P 500 INDEX Equity Fund
--------------- ------------- -----------------------
<S> <C> <C> <C>
Beginning 1.00 1.00 1.00
1997
February 1.00 1.01 1.00
March 0.95 0.97 0.94
April 1.02 1.02 1.03
May 1.09 1.09 1.09
June 1.14 1.13 1.14
July 1.24 1.23 1.25
August 1.15 1.16 1.17
September 1.20 1.22 1.23
October 1.16 1.18 1.21
November 1.22 1.23 1.26
December 1.24 1.26 1.29
1998
January 1.29 1.27 1.32
February 1.38 1.36 1.42
March 1.44 1.43 1.47
April 1.46 1.45 1.51
May 1.42 1.42 1.46
June 1.53 1.48 1.57
July 1.53 1.46 1.58
August 1.32 1.25 1.33
September 1.42 1.33 1.44
October 1.53 1.44 1.52
November 1.65 1.53 1.67
December 1.80 1.62 1.87
1999
January 1.91 1.68 2.06
February 1.83 1.63 1.95
March 1.92 1.70 2.07
</TABLE>
*These figures represent past performance, which is no guarantee of future
results. The investment return and principal value of an investment will
fluctuate, so an investor's shares, when redeemed, may be worth more or less
than their original cost. The inception date of the Turner Large Cap Growth
Equity Fund is February 1, 1997.
- --------------------------------------------------------------------------------
Annualized total returns
Periods ending March 31, 1999
- -------------------------------------
Past one year Since inception
41.20% 40.07%
- --------------------------------------------------------------------------------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 5
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Turner Large Cap Growth Equity Fund
interest rates stay relatively low, large-cap companies' earnings and share
prices are likely to continue doing well, a judgment based in part on our
research of how in the long run the share prices of large companies have tended
to correlate inversely with the level of interest rates. And based on our
investment disciplines and fundamental analysis of earnings prospects, we find
no lack of attractive candidates for investment among the stocks in our
universe.
- --------------------------------------------------------------------------------
Fund objective
The Turner Large Cap Growth Equity Fund seeks capital appreciation. It invests
primarily in a diversified portfolio of common stocks with market
capitalizations exceeding $10 billion at the time of purchase that Turner
believes offer strong earnings growth potential. The fund's economic-sector
weightings approximate the sector weightings of the Russell Top 200 Growth
Index.
- --------------------------------------------------------------------------------
Fund profile
March 31, 1999
o CUSIP #900297508
o Top 10 holdings (1) Microsoft, (2) General Electric, (3) Pfizer, (4) Cisco
Systems, (5) Merck, (6) Intel, (7) Procter & Gamble, (8) America Online, (9)
Seagram, (10) Johnson & Johnson
o % in 10 largest holdings 43.7%
o Number of holdings 42
o Price/earnings ratio 38.8
o Weighted average market capitalization $139.2 billion
o % of holdings with positive earnings surprises 60.7%
o % of holdings with negative earnings surprises 8.3%
o Assets $8.8 million
[MARKET CAPITALIZATION GRAPH]
- --------------------------------------------------------------------------------
Sector weightings:
neutral to Russell Top 200 Growth Index
neutral to Russell Top 200 Growth Index
32.6% Technology
22.1% Health Care
15.7% Consumer discretionary/services
12.2% Consumer staples
6.6% Financial services
4.2% Utilities/communication
3.3% Producer durables
1.2% Materials/processing
Portfolio managers
[PHOTO]
John F. Hammerschmidt has served as the lead product manager of the Large Cap
Growth Equity Fund since its inception in 1997. John joined Turner in 1992.
Previously he was vice president of government securities trading with S. G.
Warburg. He holds a bachelor's degree from Lehigh University and an MBA degree
from Duke University.
[PHOTO]
Robert E. Turner, founder, chairman, and chief investment officer of Turner
Investment Partners, serves as a comanager of the Large Cap Growth Equity Fund.
A Chartered Financial Analyst, Bob previously was senior investment manager with
Meridian Investment Company. He earned bachelor's and MBA degrees at Bradley
University.
[PHOTO]
Mark D. Turner, president of Turner Investment Partners, serves as a comanager
of the Large Cap Growth Equity Fund. Mark joined Turner when it was founded in
1990. He previously served as vice president and senior portfolio manager with
First Maryland Asset Management. He earned a bachelor's degree from Bradley
University and an MBA degree from the University of Illinois.
6 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
Turner Growth Equity Fund
Total return
Six-month period ending March 31, 1999
- ---------------------------------------------------------
Turner Growth Equity Fund 35.81%
Lipper Capital Appreciation Funds Average 28.71
S&P 500 Index 27.34
Russell 1000 Growth Index 34.81
- ---------------------------------------------------------
Excellent stock selection and an overweighting in strong-performing big stocks
powered the Turner Growth Equity Fund to a 35.81% return in the past six months.
That result outperformed both the large growth stocks in the Russell 1000 Growth
Index by 1.00 percentage point and the diverse range of large stocks in the S&P
500 Index by 8.47 percentage points.
Six of Growth Equity's 10 sector investments outperformed their corresponding
Russell 1000 Growth Index sectors. (In our sector-neutral approach that's a
distinguishing aspect of our growth-stock investment process, the weighting of
our combined investments in each sector closely matches the weighting of the
analogous sector in the index.) Investments in the technology,
consumer-discretionary/services, producer-durables, and utilities/communication
sectors provided the lion's share of Growth Equity's margin of outperformance.
Our sector-neutral approach also helped performance late in the quarter,
enabling us to exploit a rally in cyclical stocks that many growth managers may
have missed out on. Our energy investments lagged and lost money.
Our weighted average market capitalization rose markedly since last September,
an increase due partly to the continued robust appreciation in share prices of
the large stocks we owned. Indeed, some of our biggest winners, with returns
exceeding 30%, included such behemoths as Cisco Systems, EMC, Intel, IBM,
Microsoft, Network Appliance, Sun Microsystems, and Yahoo! in technology; Amgen
in health care; Amazon.com, America Online, Best Buy, Gap, Home Depot, Time
Warner, and Wal-Mart Stores in consumer discretionary/services; Walgreen in
consumer staples; Corning in materials/processing; Applied Materials,
KLA-Tencor, and Teradyne in producer durables; Firstar in financial services;
and MCI WorldCom and Qwest Communications in utilities/communication.
Growth of a $10,000 investment in the
Turner Growth Equity Fund:
April 1, 1992-March 31, 1999*
[GRAPHIC]
In the printed version of the document, a line graph appears which depicts
the following plot points:
RUSSELL 1000 TURNER GROWTH
S&P 500 INDEX GROWTH INDEX EQUITY FUND
------------- ------------ -------------
Beginning 1.00 1.00 1.00
1992
April 1.03 1.01 1.00
May 1.03 1.01 1.02
June 1.02 0.99 0.98
July 1.06 1.03 1.02
August 1.04 1.02 0.99
September 1.05 1.03 1.01
October 1.06 1.05 1.03
November 1.09 1.09 1.09
December 1.11 1.10 1.12
1993
January 1.11 1.09 1.13
February 1.13 1.07 1.13
March 1.15 1.10 1.16
April 1.12 1.05 1.13
May 1.15 1.09 1.17
June 1.16 1.08 1.18
July 1.15 1.06 1.20
August 1.20 1.10 1.25
September 1.19 1.09 1.27
October 1.21 1.12 1.31
November 1.20 1.12 1.27
December 1.22 1.14 1.29
1994
January 1.26 1.16 1.31
February 1.22 1.14 1.29
March 1.17 1.09 1.21
April 1.18 1.09 1.22
May 1.20 1.11 1.20
June 1.17 1.08 1.16
July 1.21 1.11 1.19
August 1.26 1.17 1.25
September 1.23 1.16 1.24
Wednesday, April 01, 1992 through Wednesday, March 31, 1999
Growth of a Unit Value
RUSSELL 1000 TURNER GROWTH
S&P 500 INDEX GROWTH INDEX EQUITY FUND
------------- ------------ -------------
October 1.26 1.19 1.25
November 1.21 1.15 1.19
December 1.23 1.17 1.20
1995
January 1.26 1.19 1.20
February 1.31 1.24 1.24
March 1.35 1.28 1.26
April 1.39 1.31 1.28
May 1.45 1.35 1.31
June 1.48 1.40 1.36
July 1.53 1.46 1.44
August 1.53 1.46 1.44
September 1.60 1.53 1.49
October 1.59 1.53 1.52
November 1.66 1.59 1.58
December 1.69 1.60 1.56
1996
January 1.75 1.65 1.58
February 1.77 1.68 1.60
March 1.79 1.69 1.62
April 1.81 1.73 1.70
May 1.86 1.79 1.77
June 1.87 1.79 1.77
July 1.78 1.69 1.62
August 1.82 1.73 1.69
September 1.92 1.86 1.83
October 1.98 1.87 1.82
November 2.13 2.01 1.93
December 2.09 1.97 1.86
1997
January 2.22 2.11 2.00
February 2.24 2.09 1.94
March 2.14 1.98 1.81
April 2.27 2.11 1.89
* These figures represent past performance, which is no guarantee of future
results. The investment return and principal value of an investment will
fluctuate, so an investor's shares, when redeemed, may be worth more or less
than their original cost. The inception date of the Turner Growth Equity Fund is
March 11, 1992. Returns are calculated from the first full month following the
fund's inception date.
- --------------------------------------------------------------------------------
Annualized total returns
Periods ending March 31, 1999
- --------------------------------------------
Past one Past three Past five Since
year years years inception
33.02% 31.16% 24.71% 20.37%
- --------------------------------------------------------------------------------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 7
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Turner Growth Equity Fund
Also contributing to Growth Equity's results was our avoidance of stocks that
declined sharply, such as Rite-Aid, which we sold as it came under growing
technical pressure in early March. Subsequently the stock was pounded when the
company reported disappointing fourth-quarter earnings. Our use of a broad range
of quantitative, fundamental, and technical indicators and our nimbleness in
eliminating individual positions is especially useful now, as the market remains
volatile and punishes the stocks of companies with earnings problems.
- -------------------------------------------------------------------------------
Fund objective
The Turner Growth Equity Fund seeks capital appreciation. It invests primarily
in a diversified portfolio of common stocks that, in Turner's opinion, have
strong earnings growth potential. The fund's economic-sector weightings
approximate the sector weightings of the Russell 1000 Growth Index.
- -------------------------------------------------------------------------------
Fund profile
March 31, 1999
o Ticker symbol TRGEX
o CUSIP #900297102
o Top 10 holdings (1) Microsoft, (2) General Electric, (3) Cisco Systems, (4)
Merck, (5) Intel, (6) Pfizer, (7) America Online, (8) Procter & Gamble, (9)
Johnson & Johnson, (10) Wal-Mart Stores
o % in 10 largest holdings 34.4%
o Number of holdings 86
o Price/earnings ratio 37.0
o Weighted average market capitalization $115.9 billion
o % of holdings with positive earnings surprises 65.0%
o % of holdings with negative earnings surprises 6.5%
o Assets $138.0 million
- --------------------------------------------------------------------------------
Sector weightings:
neutral to Russell 1000 Growth Index
[GRAPH]
30.5% Technology
20.1% Health care
18.8% Consumer discretionary/services
10.8% Consumer staples
8.2% Financial services
3.8% Producer durables
3.8% Utilities/communication
2.0% Materials/processing
0.8% Energy
0.5% Auto/transportation
- --------------------------------------------------------------------------------
Portfolio managers
[PHOTO]
Robert E. Turner, founder, chairman, and chief investment officer of Turner
Investment Partners, has served as the lead product manager of the Growth Equity
Fund since its inception in 1992. A Chartered Financial Analyst, Bob previously
was senior investment manager with Meridian Investment Company. He earned
bachelor's and MBA degrees at Bradley University.
[PHOTO]
John F. Hammerschmidt serves as a comanager of the Growth Equity Fund. John
joined Turner in 1992. Previously he was vice president of government securities
trading with S. G. Warburg. He holds a bachelor's degree from Lehigh University
and an MBA degree from Duke University.
[PHOTO]
Mark D. Turner, president of Turner Investment Partners, serves as a comanager
of the Growth Equity Fund. Mark joined Turner when it was founded in 1990. He
previously served as vice president and senior portfolio manager with First
Maryland Asset Management. He earned a bachelor's degree from Bradley University
and an MBA degree from the University of Illinois.
8 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
- --------------------------------------------------------------------------------
Turner Midcap Growth Fund
Total return
Six-month period ending March 31, 1999
- --------------------------------------------------------------------------------
Turner Midcap Growth Fund 52.78%
Lipper Mid-Cap Funds Average 23.42
Russell Midcap Growth Index 30.79
- --------------------------------------------------------------------------------
Since its inception in 1996, the Turner Midcap Growth Fund has always scored
high in Lipper's performance rankings for mid-cap mutual funds. True to form,
Midcap Growth's 52.78% return for the past six months ranked in the fourth
Lipper percentile. In relative terms, the return outdistanced the Russell Midcap
Growth Index's performance by 21.99 percentage points.
Midcap Growth's results were achieved against a strong backdrop for mid-cap
growth stocks. In the past six months, with little fanfare, mid-cap growth
stocks have staged a rally comparing favorably with that of their much-hyped
siblings, large-cap stocks. Indeed, the Russell Midcap Growth Index actually
outperformed the S&P 500 Index. In our judgment, the Russell index's recent
surge is just further corroboration of the risk/reward benefits that mid-cap
stocks have dispensed over eight decades: high return potential, ample
liquidity, and relatively moderate volatility.
Much of Midcap Growth's performance advantage in the past six months can be
traced to returns exceeding 80% in three sectors that have spearheaded the
latest rally: technology, utilities/communication, and consumer
discretionary/services. Overall, our stock selection was good, with seven of our
10 sector investments beating their corresponding Russell Midcap Growth Index
sectors.
Investments in various sectors related in some way to the Internet were
especially strong: At Home, Broadcom, eBay, Intuit, RealNetworks, and Xilinx in
technology; Amazon.com, DoubleClick, and Lycos in consumer
discretionary/services; Charles Schwab in financial services; and Global
Crossing in utilities/communication. What's more, we avoided huge losses in any
of our holdings, an ability we consider critical to investment success. We were
dissatisfied by our subpar relative returns in energy, autos/transportation, and
financial services.
[GRAPHIC]
In the printed version of the document, a line graph appears which depicts
the following plot points:
Growth of a $10,000 investment in the
Turner Midcap Growth Fund:
October 1, 1996-March 31, 1999*
RUSSELL MIDCAP TURNER MIDCAP
GROWTH FUND GROWTH FUND
-------------- -------------
Beginning 1.00 1.00
1996
October 0.99 1.01
November 1.05 1.06
December 1.03 1.03
1997
January 1.07 1.10
Februry 1.05 1.05
March 0.99 0.99
April 1.02 1.02
May 1.11 1.14
June 1.14 1.18
July 1.25 1.33
August 1.23 1.34
September 1.30 1.44
October 1.23 1.40
November 1.24 1.42
December 1.26 1.45
1998
January 1.24 1.43
February 1.35 1.55
March 1.41 1.65
April 1.43 1.69
May 1.37 1.60
June 1.41 1.75
July 1.35 1.65
August 1.09 1.32
September 1.17 1.46
October 1.26 1.49
November 1.35 1.61
December 1.49 1.84
1999
January 1.53 2.03
February 1.46 1.94
March 1.54 2.22
* These figures represent past performance, which is no guarantee of future
results. The investment return and principal value of an investment will
fluctuate, so an investor's shares, when redeemed, may be worht more or less
than their original costs. The inception date of the Turner Midcap Growth Fund
is October 1, 1996.
- --------------------------------------------------------------------------------
Annualized total returns
Periods ending March 31, 1999
- --------------------------------------------------
Past one year Since inception
34.80% 37.74%
- --------------------------------------------------------------------------------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 9
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Turner Midcap Growth Fund
In our judgment, our holdings still offer enticing return potential, based on
their considerable past and prospective earnings power. For instance, over the
past five years, the companies we own have increased their earnings per share at
an annualized 21.2%, versus the S&P 500 stocks' 16.8% rate. For the rest of
1999, we think a particularly fertile field for investment will be companies
that provide products and services for improving Internet commerce and
increasing the bandwidth (the amount of data that can be accommodated in a fixed
amount of time) of electronic systems ranging from computers to digital
telephone networks.
- --------------------------------------------------------------------------------
Fund objective
The Turner Midcap Growth Fund seeks capital appreciation. It invests primarily
in a diversified portfolio of common stocks with market capitalizations between
$1 billion and $8 billion at the time of purchase that Turner believes offer
strong earnings growth potential. The fund's economic-sector weightings
approximate the sector weightings of the Russell Midcap Growth Index.
- --------------------------------------------------------------------------------
Fund profile
March 31, 1999
o Ticker symbol TMGFX
o CUSIP #900297409
o Top 10 holdings (1) Charles Schwab, (2) Omnicom Group, (3) Amazon.com, (4)
Providian Financial, (5) Yahoo!, (6) Bausch & Lomb, (7) Capital One
Financial, (8) U.S. Foodservice, (9) VISX, (10) Network Solutions
o % in 10 largest holdings 13.3%
o Number of holdings 109
o Price/earnings ratio 35.5
o Weighted average market capitalization $7.5 billion
o % of holdings with positive earnings surprises 65.1%
o % of holdings with negative earnings surprises 10.9%
o Assets $60.3 million
- --------------------------------------------------------------------------------
Sector weightings:
neutral to Russell Midcap Growth Index
[GRAPH]
27.4% Consumer discretionary/services
20.6% Technology
13.0% Financial services
12.2% Health care
5.7% Producer durables
5.0% Materials/processing
4.9% Consumer staples
2.4% Energy
2.3% Utilities/communication
1.9% Autos/transportation
- --------------------------------------------------------------------------------
Portfolio managers
[PHOTO]
Christopher K. McHugh has served as the lead product manager of the Midcap
Growth Fund since its inception in 1996. Chris joined Turner when it was founded
in 1990 and previously held a position as performance specialist at Provident
Capital Management. He earned a bachelor's degree at the Philadelphia College of
Textiles and Science and an MBA degree at St.
Joseph's University.
[PHOTO]
William C. McVail serves as a comanager of the Midcap Growth Fund. Before
joining Turner in 1998, Bill was a portfolio manager at PNC Equity Advisors. A
Chartered Financial Analyst, Bill received a bachelor's degree from Vassar
College.
[PHOTO]
Robert E. Turner, founder, chairman, and chief investment officer of Turner
Investment Partners, serves as a comanager of the Midcap Growth Fund. A
Chartered Financial Analyst, Bob previously was senior investment manager with
Meridian Investment Company. He earned bachelor's and MBA degrees at Bradley
University.
10 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
- --------------------------------------------------------------------------------
Turner Small Cap Growth Fund
Total return
Six-month period ending March 31, 1999
- --------------------------------------------------------------------------------
Turner Small Cap Growth Fund 32.20%
Lipper Small Cap Funds Average 12.53
Russell 2000 Growth Index 21.56
- --------------------------------------------------------------------------------
The Turner Small Cap Growth Fund reinforced its #1 Lipper five-year ranking
among 230 small-cap funds by returning 32.20% in the past six months. In the
process, Small Cap Growth outperformed the Russell 2000 Growth Index by 10.64
percentage points.
Small Cap Growth's edge was due mainly to solid stock selection (six of 10
sector investments outperformed) and perceptive technical analysis (which
enabled us to generally avoid the severe losses that pitted the small-cap
landscape). As was the case with most of our stock mutual funds, Small Cap
Growth's biggest contributions to performance came from its two biggest sector
positions, technology and consumer discretionary/services, which have a combined
weighting of about 46% and generated returns of more than 60% in aggregate. Our
more modest utilities/communication holdings also registered a 60%-plus return.
Consumer-staples and energy investments were a significant drag on results.
Among our best-performing stocks, certain common themes were apparent: the
pervasive influence of the Internet on the nation's business life;
technology-inspired increases in productivity; the accelerating convergence of
telecommunications, computer, and television technologies; and growth in
consumer spending. Profitable investments reflecting those themes included
Concentric Network, Geotel Communications, Macromedia, Metromedia Fiber Network,
MIPS Technologies, Network Solutions, New Era of Networks, QLogic, and RF Micro
Devices in technology; American Eagle Outfitters, CNET, DoubleClick, Exodus
Communications, TMP Worldwide, and Williams-Sonoma in consumer
discretionary/services; Dycom Industries in materials/processing; Novellus
Systems in producer durables; Knight/Trimark Group in financial services; and
Adelphia Communications, Nextlink Communications, and RCN in
utilities/communication.
[GRAPHIC]
In the printed version of the document, a line graph appears which depicts
the following plot points:
Growth of a $10,000 investment in the
Turner Small Cap Growth Fund:
March 1, 1994-March 31, 1999*
RUSSELL 2000 TURNER SMALL CAP
GROWTH INDEX GROWTH FUND
------------ ----------------
Beginning 1.00 1.00
1994
March 0.94 0.95
April 0.94 0.96
May 0.92 0.94
June 0.88 0.91
July 0.89 0.94
August 0.96 1.00
September 0.96 1.03
October 0.97 1.07
November 0.93 1.03
December 0.95 1.08
1995
January 0.94 1.05
February 0.98 1.10
March 1.01 1.16
April 1.02 1.19
May 1.04 1.22
June 1.11 1.34
July 1.19 1.51
August 1.21 1.52
September 1.23 1.58
October 1.17 1.58
November 1.22 1.74
December 1.25 1.81
1996
January 1.24 1.80
February 1.30 1.88
March 1.32 2.00
April 1.42 2.28
May 1.50 2.45
June 1.40 2.35
July 1.23 2.09
August 1.32 2.26
September 1.39 2.41
October 1.33 2.31
November 1.37 2.35
December 1.39 2.33
1997
January 1.43 2.36
Februry 1.34 2.17
March 1.25 1.94
April 1.23 1.96
May 1.42 2.26
June 1.46 2.41
July 1.54 2.60
August 1.59 2.62
September 1.71 2.81
October 1.61 2.65
November 1.57 2.59
December 1.57 2.68
1998
January 1.55 2.66
February 1.69 2.89
March 1.76 3.08
April 1.77 3.11
May 1.64 2.89
June 1.66 3.09
July 1.52 2.81
August 1.17 2.13
September 1.29 2.34
October 1.35 2.36
November 1.46 2.59
December 1.59 2.90
1999
January 1.66 3.07
February 1.51 2.75
March 1.56 3.09
* These figures represent past performance, which is no guarantee of future
results. The investment return and principal value of an investment will
fluctuate, so an investor's shares, when redeemed, may be worth more or less
than their original cost. The inception date of the Turner Small Cap Growth Fund
is February 7, 1994. Returns are calculated from the first full month following
the fund's inception date.
- --------------------------------------------------------------------------------
Annualized total returns
Periods ending March 31, 1999
- --------------------------------------------------------------------
Past one Past three Past five Since
year years years inception
0.32% 15.57% 26.67% 24.99%
- --------------------------------------------------------------------------------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 11
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Turner Small Cap Growth Fund
Although small-cap stocks' performance has picked up in recent months, their
much-anticipated outperformance over other asset classes has yet to materialize.
When that period of outperformance will begin is at best a subject for informed
conjecture, but we do think that when it does begin, it will be fostered by a
sustained cycle of superior earnings growth by small-cap companies.
Interestingly, the potential catalyst is in place: the earnings prospects of
small stocks markedly exceed those of larger stocks, according to the consensus
of Wall Street analysts. What's more, small caps' growth potential can be
purchased at a discount: the Russell 2000 Index's average price/earnings ratio,
based on trailing 12-month earnings, is 38% lower than that of the large-cap S&P
500 Index.
- --------------------------------------------------------------------------------
Fund objective
The Turner Small Cap Growth Fund seeks capital appreciation. It invests
primarily in a diversified portfolio of common stocks with market
capitalizations at the time of purchase not exceeding $2 billion that Turner
believes offer strong earnings growth potential. The fund's economic-sector
weightings approximate the sector weightings of the Russell 2000 Growth Index.
- --------------------------------------------------------------------------------
Fund profile
March 31, 1999
o Ticker symbol TSCEX
o CUSIP #900297300
o Top 10 holdings (1) MIPS Technologies, (2) Exodus Communications, (3) Visual
Networks, (4) TMP Worldwide, (5) Multex.com, (6) Smurfit-Stone Container, (7)
DoubleClick, (8) Patterson Dental, (9) The BISYS Group, (10) Profit Recovery
Group
o % in 10 largest holdings 13.3%
o Number of holdings 132
o Price/earnings ratio 21.8
o Weighted average market capitalization $1.5 billion
o % of holdings with positive earnings surprises 64.9%
o % of holdings with negative earnings surprises 10.1%
o Assets $196.0 million
[MARKET CAPITALIZATION GRAPH]
<PAGE>
- --------------------------------------------------------------------------------
Sector weightings:
neutral to Russell 2000 Growth Index
[GRAPH]
23.3% Technology
22.6% Consumer discretionary/services
15.2% Financial services
12.6% Health care
7.4% Producer durables
6.0% Utilities/communication
5.6% Materials/processing
2.3% Energy
2.2% Autos/transportation
1.1% Consumer staples
- --------------------------------------------------------------------------------
Portfolio managers
[PHOTO]
William C. McVail serves as the lead product manager of the Small Cap Growth
Fund. Before joining Turner in 1998, Bill was a portfolio manager at PNC Equity
Advisors. A Chartered Financial Analyst, Bill received a bachelor's degree from
Vassar College.
[PHOTO]
Frank L. Sustersic serves as a comanager of the Small Cap Growth Fund. A
Chartered Financial Analyst, Frank joined Turner in 1994. Previously he was an
investment officer and fund manager with First Fidelity Bank Corporation. He
holds a bachelor's degree from the University of Pennsylvania.
[PHOTO]
Christopher K. McHugh serves as a comanager of the Small Cap Growth Fund. Chris
joined Turner when it was founded in 1990 and previously held a position as
performance specialist at Provident Capital Management. He earned a bachelor's
degree at the Philadelphia College of Textiles and Science and an MBA degree at
St. Joseph's University.
12 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
- --------------------------------------------------------------------------------
Turner Micro Cap Growth Fund
Total return
Six-month period ending March 31, 1999
- --------------------------------------------------------------------------------
Turner Micro Cap Growth Fund 45.95%
Lipper Micro Cap Funds Average 21.08
Russell 2000 Growth Index 21.56
- --------------------------------------------------------------------------------
In December, Morningstar named the Turner Micro Cap Growth Fund one of the 10
best-performing new mutual funds of 1998, from a universe of 189 funds started
during the year. Over the past six months Micro Cap Growth continued to build on
its strong initial achievements, delivering a 45.95% return that represented an
outperformance of 24.39 percentage points over the Russell 2000 Growth Index.
Since its March 1, 1998, inception, Micro Cap Growth has gained an annualized
40.01%--46.76 percentage points above the index's negative return.
For the most recent six months, Micro Cap Growth's superior results can be
attributed mainly to these factors:
One, elevated returns in its three biggest sector positions: consumer
discretionary/services, technology, and health care, which altogether accounted
for 67% of holdings. In a sector that recorded a barely positive return in the
index, our materials/processing investments were up 40%, adding significant
value to our performance as well.
Two, our growth-investing style remained in favor. By and large the market was
driven by fundamentals: the stocks that did best had the best earnings and the
best earnings prospects--in short, growth stocks. The preference for growth
stocks was such during the period that the Russell 2000 Growth Index
outperformed its value counterpart by 3.28 percentage points.
[GRAPHIC]
In the printed version of the document, a line graph appears which depicts
the following plot points:
Growth of a $10,000 investment in the
Turner Micro Cap Growth Fund:
March 1, 1998-March 31, 1999*
RUSSELL 2000 TURNER MICRO CAP
GROWTH INDEX GROWTH FUND
------------ ----------------
Beginning 1.00 1.00
1998
March 1.04 1.08
April 1.05 1.14
May 0.97 1.11
June 0.98 1.14
July 0.90 1.12
August 0.69 0.89
September 0.76 0.99
October 0.80 1.00
November 0.86 1.17
December 0.94 1.39
1999
January 0.99 1.47
February 0.90 1.43
March 0.93 1.44
* These figures represent past performance, which is no guarantee of future
results. The investment return and principal value of an investment will
fluctuate, so an investor's shares, when redeemed, may be worth more or less
than their original cost. The inception date of the Turner Micro Cap Growth Fund
is March 1, 1998.
- --------------------------------------------------------------------------------
Annualized total returns
Periods ending March 31, 1999
- --------------------------------------------
Past one year Since inception
33.52% 40.01%
- --------------------------------------------------------------------------------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 13
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Turner Micro Cap Growth Fund
And three, excellent outcomes in our largest positions in individual stocks--the
stocks in which we had the greatest confidence in their performance. We seek to
emphasize the stocks of companies doing business in very specific, profitable
niches they can dominate, and our most lucrative individual holdings are in fact
succeeding by dominating their niches. To cite several examples in the
consumer-discretionary/services and health-care sectors: Shop at Home, which
sells consumer products through interactive TV programs transmitted via
satellite; K-Swiss, which has produced a strong brand image and demand for its
athletic shoes and a series of positive earnings surprises in an industry
encountering sagging profits; and Laser Vision Centers, which performs
outpatient laser surgery to correct vision problems.
We remain enthused about the return potential of our holdings. Perhaps most
significantly, the companies we own have growth rates exceeding the forward
price/earnings ratios of their shares--a price/earnings multiple-to-growth-rate
ratio of 0.66, evidence of compelling return potential, in our judgment.
- --------------------------------------------------------------------------------
Fund objective
The Turner Micro Cap Growth Fund seeks capital appreciation. It invests
primarily in a diversified portfolio of common stocks that, in Turner's opinion,
have strong earnings growth potential and market capitalizations not exceeding
$500 million at the time of purchase. The fund's economic-sector weightings stay
within a range that's not more than 50% above or below the sector weightings of
the Russell 2000 Growth Index.
- --------------------------------------------------------------------------------
Fund profile
March 31, 1999
o CUSIP #872524301
o Top 10 holdings (1) Creditrust, (2) Summit Technologies, (3) Advance
Paradigm, (4) Photon Dynamics, (5) Forward Air, (6) SoftNet Systems, (7) Rock
Financial, (8) D&K Healthcare Resources, (9) Laser Vision Centers, (10)
Gaylord Container
o % in 10 largest holdings 16.6%
o Number of holdings 115
o Price/earnings ratio 24.0
o Weighted average market capitalization $260 million
o % of holdings with positive earnings surprises 38.9%
o % of holdings with negative earnings surprises 6.0%
o Assets $6.1 million
[GRAPH]
<PAGE>
- --------------------------------------------------------------------------------
Sector weightings:
resemble Russell 2000 Growth Index
28.2% Consumer discretionary/services
21.8% Technology
16.9% Health care
8.0% Financial services
6.3% Materials/processing
4.5% Utilities/communication
4.4% Producer durables
4.3% Autos/transportation
2.2% Consumer staples
2.0% Energy
- --------------------------------------------------------------------------------
Portfolio managers
[PHOTO]
Frank L. Sustersic has served as the lead product manager of the Micro Cap
Growth Fund since its inception in 1998. A Chartered Financial Analyst, Frank
joined Turner in 1994. Previously he was an investment officer and fund manager
with First Fidelity Bank Corporation. He holds a bachelor's degree from the
University of Pennsylvania.
[PHOTO]
William C. McVail serves as the comanager of the Micro Cap Growth Fund. Before
joining Turner in 1998, Bill was a portfolio manager at PNC Equity Advisors. A
Chartered Financial Analyst, Bill received a bachelor's degree from Vassar
College.
[PHOTO]
Christopher J. Perry serves as the comanager of the Micro Cap Growth Fund. Chris
joined Turner in 1998 after serving as a research analyst at the Pennsylvania
Merchant Group. A Chartered Financial Analyst, he earned a bachelor's degree at
Villanova University and an MBA degree at Drexel University.
14 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
- --------------------------------------------------------------------------------
Turner Short Duration Government Funds-
Three Year Portfolio
Total return
Six-month period ending March 31, 1999
- --------------------------------------------------------------------------------
Turner Short Duration Government
Funds-Three Year Portfolio 1.33%
Lipper Short/Intermediate
U.S. Government Funds Average 0.34
Lehman Brothers 1-3 Year
U.S. Government Bond Index 1.38
- --------------------------------------------------------------------------------
Despite rising interest rates and declining bond prices at all maturities, the
Turner Short Duration Government Funds-Three Year Portfolio produced a positive
return of 1.33% in the past six months. However, the Three Year Portfolio
slightly underperformed its benchmark, the Lehman Brothers 1-3 Year U.S.
Government Bond Index, by 0.05 percentage points.
The Three Year Portfolio's modest shortfall can be attributed to two factors:
One, it had a substantial weighting in Treasury securities, the worst-performing
sector in the investment-grade market. After embracing the safety of Treasuries
last fall in the wake of Russia's massive debt default and Asia's economic
crises, investors reversed course; they concluded that the worst was probably
over for foreign economies, so riskier bonds that offered markedly higher yields
were now more attractive and the safety (and modest yields) of Treasuries were
now less attractive. As a result, demand for Treasuries slackened, and their
prices fell sharply.
And two, its average duration (its interest-rate sensitivity) was slightly
longer than that of the index. With rates rising, we would have more effectively
protected the prices of our holdings had we set our duration shorter. As a rule
we are conservative in our duration policies; we limit interest-rate risk by
setting our fixed-income funds' average durations moderately close to those of
the indexes--a maximum range of 20% above or below the index. Although our
duration was well within the high end of the range, in this case we would have
been better served with an even more conservative positioning.
Growth of a $10,000 investment in the
Turner Short Duration Government Funds-Three Year Portfolio:
March 1, 1994-March 31, 1999*
[GRAPHIC]
In the printed version of the document, a line graph appears which depicts
the following plot points:
Tuesday, March 01, 1994 through Wednesday, March 31, 1999
Growth of a Unit Value
Lehman
1-3 Year Turner
Government Three Year
Bond Index Portfolio
---------- ----------
Beginning 1.00 1.00
1994
March 0.99 1.01
April 1.00 1.01
May 1.00 1.01
June 1.00 1.01
July 1.01 1.02
August 1.01 1.03
September 1.01 1.03
October 1.01 1.03
November 1.01 1.03
December 1.01 1.04
1995
January 1.02 1.05
February 1.03 1.06
March 1.04 1.07
April 1.04 1.08
May 1.06 1.10
June 1.06 1.10
July 1.07 1.11
August 1.08 1.12
September 1.08 1.12
October 1.09 1.13
November 1.09 1.14
December 1.10 1.15
1996
January 1.11 1.16
February 1.11 1.17
March 1.11 1.17
April 1.11 1.17
May 1.11 1.17
June 1.11 1.18
July 1.12 1.19
August 1.12 1.19
September 1.13 1.22
October 1.14 1.22
November 1.15 1.23
December 1.15 1.23
1997
January 1.15 1.23
February 1.16 1.24
March 1.15 1.24
April 1.16 1.25
May 1.17 1.25
June 1.17 1.26
July 1.19 1.28
August 1.19 1.28
September 1.19 1.29
October 1.20 1.30
November 1.20 1.30
December 1.21 1.31
1998
January 1.22 1.32
February 1.22 1.32
March 1.22 1.33
April 1.22 1.34
May 1.23 1.34
June 1.24 1.35
July 1.24 1.36
August 1.25 1.37
September 1.26 1.39
October 1.27 1.40
November 1.27 1.40
December 1.27 1.40
1999
January 1.29 1.41
February 1.29 1.42
March 1.29 1.43
(C) Frank Russell Company
* These figures represent past performance, which is no guarantee of future
results. The investment return and principal value of an investment will
fluctuate, so an investor's shares, when redeemed, may be worth more or less
than their original cost. The inception date of the Turner Short Duration
Government Funds-Three Year Portfolio is March 1, 1994.
- --------------------------------------------------------------------------------
Annualized total returns
Periods ending March 31, 1999
- ---------------------------------------------------------------------
Past one Past three Past five Since
year years years inception
6.16% 6.45% 6.56% 6.31%
- --------------------------------------------------------------------------------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 15
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Turner Short Duration Government Funds-
Three Year Portfolio
On the plus side, our substantial position in mortgage-backed securities did
well (mortgages were the best- performing investment-grade sector). Our
commercial mortgage-backed holdings received a boost when that class of
securities was added to the Lehman Brothers Aggregate Bond Index in the first
quarter.
In light of the potential risks posed by the conflict between Serbia and Kosovo
and the narrowing of yield spreads, we are adding to our position in Treasuries;
they tend to outperform when spreads are narrow (as is the case now) or in times
of international turmoil.
- --------------------------------------------------------------------------------
Fund objective
The Turner Short Duration Government Funds-Three Year Portfolio seeks to produce
maximum total return consistent with the preservation of capital and investment
prudence. It invests primarily in high-grade securities issued or guaranteed by
the U.S. government or its agencies. The fund seeks to limit fluctuations in
principal and reduce interest-rate risk by maintaining an average effective
duration no greater than that of a three-year Treasury note.
- --------------------------------------------------------------------------------
Fund profile
March 31, 1999
o Ticker symbol TSDGX
o CUSIP #872524202
o Top 10 holdings (1) U.S. Treasury Notes, 5.50%, 05/31/00, (2) U.S. Treasury
Notes, 6.25%, 06/30/02, (3) U.S. Treasury Notes, 5.00%, 02/28/01, (4) FNCI,
6.00%, 01/01/19, (5) CWHL, 7.50%, 1997-2 A11, 04/25/27, (6) Federal Home Loan
Mortgage Corporation, 9.50%, 161 F, 06/15/06, (7) Federal Home Loan Mortgage
Corporation - Gold, 6.00%, 04/19/99, (8) U.S. Treasury Notes, 5.75%,
10/31/00, (9) Contimortgage Home Equity Loan Trust Series 1996-2, A5,
04/15/11, (10) Structured Asset Securities Corporation, Variable Coupon,
10/30/07
o Number of holdings 27
o Average effective duration 1.8 years
o Average maturity 2.5 years
o Average yield to maturity 5.29%
o Average credit quality Agency
o Convexity (0.18)
o Assets $18.8 million
- --------------------------------------------------------------------------------
Sector weightings:
[GRAPH]
47.5% Treasury securities
44.1% Mortgage-backed securities
4.8% Asset-backed securities
2.9% Agency securities
0.7% Other
- --------------------------------------------------------------------------------
Portfolio managers
[PHOTO]
James I. Midanek, fixed-income chief investment officer, has served as manager
of the Short Duration Funds-Three Year Portfolio since inception. Jim joined
Turner in 1998, upon our acquisition of Solon Asset Management, which he
cofounded. Previously he was chief investment officer, fixed income with
Montgomery Asset Management. He holds a bachelor's degree from Queens College.
[PHOTO]
Kathy Dull, senior portfolio manager/security analyst, joined the firm in 1997.
She earned a bachelor's degree at Miami University, Oxford, Ohio. Previously
Kathy was an assistant to the fixed-income portfolio manager at Montgomery Asset
Management.
[PHOTO]
Robb J. Parlanti, senior portfolio manager/security analyst, joined Turner in
1993. A Chartered Financial Analyst, he received a bachelor's degree at Wake
Forest University. Robb formerly was an assistant vice president/portfolio
manager at PNC Bank.
16 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
Turner Short Duration Government Funds-
One Year Portfolio
Total return
Six-month period ending March 31, 1999
- --------------------------------------------------------------------------------
Turner Short Duration Government
Funds-One Year Portfolio
(Institutional Class) 2.74%
Lipper Ultra-Short Obligation Funds Average 2.21
Merrill Lynch Three-Month
U.S. Treasury Bill Index 2.19
- --------------------------------------------------------------------------------
In general, when interest rates rise, shorter maturities are best at protecting
fixed-income principal. For the Turner Short Duration Government Funds-One Year
Portfolio, that proved to be the case in the past six months, a time in which
any security with a maturity of five years or longer lost money. (Indeed, the
peril of investing in long bonds was readily apparent during this time, as the
30-year Treasury was down 8.33%.) In contrast, the One Year Portfolio's
Institutional Class did an excellent job of protecting principal, earning a
2.74% return and outperforming the Merrill Lynch Three-Month U.S. Treasury Bill
Index by an impressive differential, 0.55 percentage points.
Traditionally, a prime benefit of the One Year Portfolio has been that it offers
a significantly higher yield than a money-market investment does and only
incrementally higher risk; a one-year security, for instance, has rarely
recorded a negative annual return. The average duration of the One Year
Portfolio now is very short (and very protective): 0.4 years. Yet its yield to
maturity of 5.07% represents a not-inconsiderable premium of 57 basis points
over a six-month Treasury bill.
That yield premium and conservative maturity structure were the primary reasons
for the One Year Portfolio's outperformance. In general, our security selection
was commendable, and we took profits in certain collateralized mortgage
obligations, part of a sector, mortgage-backed securities, that outperformed all
others in the investment-grade market. A sizable number of our mortgage holdings
are discount mortgages (securities selling below their redemption value), which
we think offer attractive total-return potential.
Growth of a $10,000 investment in the
Turner Short Duration Government Funds-One Year Portfolio (Institutional Class):
March 1, 1994-March 31, 1999*
[GRAPHIC]
In the printed version of the document, a line graph appears which depicts
the following plot points:
Tuesday, March 01, 1994 through Wednesday, March 31, 1999
Growth of a Unit Value
Merrill Lynch Turner
Three-Month One Year
Treasury Index Portfolio
-------------- ----------
Beginning 1.00 1.00
1994
March 1.00 1.00
April 1.01 1.01
May 1.01 1.01
June 1.01 1.01
July 1.02 1.02
August 1.02 1.02
September 1.03 1.02
October 1.03 1.03
November 1.03 1.03
December 1.04 1.04
1995
January 1.04 1.05
February 1.05 1.05
March 1.05 1.06
April 1.06 1.06
May 1.06 1.07
June 1.07 1.08
July 1.07 1.08
August 1.08 1.09
September 1.08 1.09
October 1.09 1.10
November 1.09 1.11
December 1.10 1.12
1996
January 1.10 1.12
February 1.11 1.13
March 1.11 1.13
April 1.12 1.14
May 1.12 1.14
June 1.13 1.15
July 1.13 1.16
August 1.14 1.16
September 1.14 1.17
October 1.15 1.18
November 1.15 1.18
December 1.16 1.19
1997
January 1.16 1.19
February 1.17 1.20
March 1.17 1.20
April 1.18 1.21
May 1.18 1.22
June 1.19 1.22
July 1.19 1.23
August 1.20 1.24
September 1.20 1.24
October 1.21 1.25
November 1.21 1.26
December 1.22 1.26
1998
January 1.22 1.27
February 1.23 1.28
March 1.23 1.28
April 1.24 1.29
May 1.25 1.29
June 1.25 1.30
July 1.26 1.30
August 1.26 1.31
September 1.27 1.32
October 1.27 1.32
November 1.28 1.33
December 1.28 1.34
1999
January 1.29 1.34
February 1.29 1.35
March 1.30 1.36
(C) Frank Russell Company
* These figures represent past performance, which is no guarantee of future
results. The investment return and principal value of an investment will
fluctuate, so an investor's shares, when redeemed, may be worth more or less
than their original cost. The inception date of the Turner Short Duration
Government Funds-One Year Portfolio (Institutional Class) is March 1, 1994.
- --------------------------------------------------------------------------------
Annualized total returns
Periods ending March 31, 1999
Past one Past three Past five Since
year years years inception
5.92% 6.18% 6.26% 6.18%
- --------------------------------------------------------------------------------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 17
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
Turner Short Duration Government Funds-
One Year Portfolio
Also, we think six-month maturities offer an attractive premium to an inflation
rate that's the lowest in decades. So we are seeking to augment our positions at
the shortest end of the yield curve, in the money markets; about 80% of our
current investments have a maturity of one year or less. Also, although we
currently have almost equal weightings in Treasuries and mortgages, we plan to
add more Treasuries in coming months; in our analysis, Treasuries offer a
favorable risk/reward tradeoff now: zero credit risk and relatively competitive
yields, a combination that we think should do well in the months ahead,
especially if military actions in Yugoslavia intensify.
- --------------------------------------------------------------------------------
Fund objective
The Turner Short Duration Government Funds-One Year Portfolio seeks to produce
maximum total return consistent with preservation of capital and investment
prudence. It invests primarily in high-grade securities issued or guaranteed by
the U.S. government or its agencies. The fund seeks to limit fluctuations in
principal and reduce interest-rate risk by maintaining an average effective
duration no greater than that of a one-year Treasury bill.
- --------------------------------------------------------------------------------
Fund profile
March 31, 1999
o CUSIP #872524103 (Institutional Class)
o Top 10 holdings (1) U.S. Treasury Note, 5.625%, 11/30/99, (2) FHLMC, 9.50%,
161F, 06/15/06, (3) FHLMC, 4.80%, 04/14/99, (4) FHLMC, 4.816%, 04/01/99, (5)
GNMA, 6.125%, #8297, (6) U.S. Treasury Note, 5.75%, 10/31/00, (7) GNMA,
6.875%, #8489, (8) FHLMC, 4.80%, 04/01/99, (9) NationsBank Credit Card Master
Trust, 1996 Class A, (10) FHLMC, 4.84%, 04/06/99
o Number of holdings 20
o Average effective duration 0.4 years
o Average maturity 0.5 years
o Average yield to maturity 5.07%
o Average credit quality Agency
o Convexity 0
o Assets $1.2 million
[CREDIT QUALITY GRAPH]
- --------------------------------------------------------------------------------
Sector weightings:
28.6% Mortgage-backed securities
26.9% Treasury securities
12.6% Asset-backed securities
31.9% Other
- --------------------------------------------------------------------------------
Portfolio managers
[PHOTO]
James I. Midanek, fixed-income chief investment officer, has served as manager
of the Short Duration Funds-One Year Portfolio since inception. Jim joined
Turner in 1998, upon our acquisition of Solon Asset Management, which he
cofounded. Previously he was chief investment officer, fixed income with
Montgomery Asset Management. He holds a bachelor's degree from Queens College.
[PHOTO]
Kathy Dull, senior portfolio manager/security analyst, joined the firm in 1997.
She earned a bachelor's degree at Miami University, Oxford, Ohio. Previously
Kathy was an assistant to the fixed-income portfolio manager at Montgomery Asset
Management.
[PHOTO]
Robb J. Parlanti, senior portfolio manager/security analyst, joined Turner in
1993. A Chartered Financial Analyst, he received a bachelor's degree at Wake
Forest University. Robb formerly was an assistant vice president/portfolio
manager at PNC Bank.
18 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
FINANCIAL STATEMENTS (Unaudited)
- --------------------------------------------------------------------------------
Statement of net assets
Turner Large Cap Growth Equity Fund
March 31, 1999
Value
Shares (000)
- --------------------------------------------------------------------------------
Common stocks--97.5%
- --------------------------------------------------------------------------------
Aircraft--1.0%
- --------------------------------------------------------------------------------
Allied Signal 1,850 $ 91
---------
Total Aircraft 91
---------
- --------------------------------------------------------------------------------
Beauty products--4.9%
- --------------------------------------------------------------------------------
Gillette 2,050 122
Procter & Gamble 3,145 308
---------
Total Beauty products 430
---------
- --------------------------------------------------------------------------------
Broadcasting, newspapers, and advertising--3.3%
- --------------------------------------------------------------------------------
AT&T Corp-Liberty Media, Cl A* 2,400 126
Fox Entertainment Group, Cl A* 6,165 167
---------
Total Broadcasting, newspapers,
and advertising 293
---------
- --------------------------------------------------------------------------------
Communications equipment--3.3%
- --------------------------------------------------------------------------------
Northern Telecom Ltd 1,700 106
Tellabs* 1,900 186
---------
Total Communications equipment 292
---------
- --------------------------------------------------------------------------------
Computers and services--18.5%
- --------------------------------------------------------------------------------
America Online* 2,090 305
Cisco Systems* 4,022 441
EMC* 1,500 192
Microsoft* 6,270 562
Sun Microsystems* 1,045 131
---------
Total Computers and services 1,631
---------
- --------------------------------------------------------------------------------
Drugs--16.2%
- --------------------------------------------------------------------------------
Abbott Laboratories 3,665 172
Eli Lilly 2,455 208
Merck 4,595 368
Pfizer 3,350 465
Schering Plough 4,020 222
---------
Total Drugs 1,435
---------
- --------------------------------------------------------------------------------
Electronics--2.8%
- --------------------------------------------------------------------------------
Motorola 3,400 249
---------
Total Electronics 249
---------
Value
Shares (000)
- --------------------------------------------------------------------------------
Entertainment--2.8%
- --------------------------------------------------------------------------------
Time Warner 1,210 $ 86
Walt Disney 5,100 159
---------
Total Entertainment 245
---------
- --------------------------------------------------------------------------------
Financial services--6.6%
- --------------------------------------------------------------------------------
American Express 700 82
Citigroup 2,080 133
Household International 3,470 158
Morgan Stanley, Dean Witter,
Discover & Company 2,100 210
---------
Total Financial services 583
---------
- --------------------------------------------------------------------------------
Food, beverage, and tobacco--6.0%
- --------------------------------------------------------------------------------
Coca-Cola Company 675 41
Coca-Cola Enterprises 2,440 74
PepsiCo 3,780 148
Seagram 5,350 268
---------
Total Food, beverage, and tobacco 531
---------
- --------------------------------------------------------------------------------
Household products--6.0%
- --------------------------------------------------------------------------------
General Electric 4,800 531
---------
Total Household products 531
---------
- --------------------------------------------------------------------------------
Machinery--2.3%
- --------------------------------------------------------------------------------
Applied Materials* 3,290 203
---------
Total Machinery 203
---------
- --------------------------------------------------------------------------------
Medical products and services--2.8%
- --------------------------------------------------------------------------------
Amgen* 2,130 159
Medtronic 1,180 85
---------
Total Medical products and services 244
---------
- --------------------------------------------------------------------------------
Miscellaneous consumer products--3.0%
- --------------------------------------------------------------------------------
Johnson & Johnson 2,855 268
---------
Total Miscellaneous consumer products 268
---------
- --------------------------------------------------------------------------------
Miscellaneous manufacturing--1.1%
- --------------------------------------------------------------------------------
Tyco International Limited 1,410 101
---------
Total Miscellaneous manufacturing 101
---------
- --------------------------------------------------------------------------------
Retail--7.3%
- --------------------------------------------------------------------------------
Home Depot 2,893 180
Safeway* 2,018 104
Wal-Mart Stores 2,575 237
Walgreen 4,540 128
---------
Total Retail 649
---------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 19
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of net assets
Turner Large Cap Growth Equity Fund
Shares/face Value
amount (000) (000)
- --------------------------------------------------------------------------------
Semiconductors/instruments--5.4%
- --------------------------------------------------------------------------------
Intel 2,930 $ 348
Texas Instruments 1,280 127
---------
Total Semiconductors/instruments 475
---------
- --------------------------------------------------------------------------------
Telephones and telecommunication--4.2%
- --------------------------------------------------------------------------------
AT&T 1,365 109
MCI WorldCom* 2,950 261
---------
Total Telephones and
telecommunication 370
---------
- --------------------------------------------------------------------------------
Total Common stocks (cost $7,549) 8,621
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Repurchase agreement--1.1%
- --------------------------------------------------------------------------------
Morgan Stanley, 4.50%, dated 03/31/99,
matures 4/01/99, repurchase price
$95,461 (collateralized by U.S. Treasury
Note, par value $230,657, 7.75%,
02/15/01, market value $249,450) $95 95
- --------------------------------------------------------------------------------
Total Repurchase agreement
(cost $95) 95
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total investments--98.6%
(cost $7,644) 8,716
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Other assets and liabilities, net: 1.4% 121
- --------------------------------------------------------------------------------
Net assets:
Portfolio shares (unlimited authorization
--no par value) based on 464,695
outstanding shares of beneficial interest 6,652
Accumulated net investment loss (12)
Accumulated net realized
gain on investments 1,125
Net unrealized appreciation
on investments 1,072
- --------------------------------------------------------------------------------
Total net assets--100.0% $8,837
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net asset value, offering and
redemption price per share $19.02
- --------------------------------------------------------------------------------
*Non-income producing security
Cl - Class
The accompanying notes are an integral part of the financial statements.
Statement of net assets
Turner Growth Equity Fund
March 31, 1999
Value
Shares (000)
- --------------------------------------------------------------------------------
Common stocks--99.4%
- --------------------------------------------------------------------------------
Aircraft--1.1%
- --------------------------------------------------------------------------------
Allied Signal 29,770 $ 1,464
---------
Total Aircraft 1,464
---------
- --------------------------------------------------------------------------------
Automotive--0.5%
- --------------------------------------------------------------------------------
Ford Motor 11,270 640
---------
Total Automotive 640
---------
- --------------------------------------------------------------------------------
Banks--1.4%
- --------------------------------------------------------------------------------
BankAmerica 9,420 665
Chase Manhattan 7,620 620
Firstar 7,660 686
---------
Total Banks 1,971
---------
- --------------------------------------------------------------------------------
Beauty products--3.9%
- --------------------------------------------------------------------------------
Gillette 29,090 1,729
Procter & Gamble 37,280 3,651
---------
Total Beauty products 5,380
---------
- --------------------------------------------------------------------------------
Broadcasting, newspapers, and advertising--3.3%
- --------------------------------------------------------------------------------
AT&T Corp-Liberty Media, Cl A* 19,090 1,005
Cox Communications, Cl A* 9,990 755
Fox Entertainment Group, Cl A* 23,500 637
Omnicom Group 10,670 853
Outdoor Systems* 20,480 614
Young & Rubicam* 17,060 695
---------
Total Broadcasting, newspapers,
and advertising 4,559
---------
- --------------------------------------------------------------------------------
Communications equipment--2.5%
- --------------------------------------------------------------------------------
Northern Telecom Ltd 17,380 1,080
Tellabs* 24,520 2,397
---------
Total Communications equipment 3,477
---------
- --------------------------------------------------------------------------------
Computers and services--15.7%
- --------------------------------------------------------------------------------
America Online* 25,560 3,732
Cisco Systems* 45,920 5,031
EMC* 21,980 2,808
Microsoft* 80,020 7,172
Sun Microsystems* 12,730 1,592
Teradyne* 13,040 711
Yahoo* 3,970 668
---------
Total Computers and services 21,714
---------
20 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
Value
Shares (000)
- --------------------------------------------------------------------------------
Drugs--14.3%
- --------------------------------------------------------------------------------
Abbott Laboratories 47,780 $ 2,237
American Home Products 36,590 2,387
Cardinal Health 17,700 1,168
Eli Lilly 21,160 1,796
Merck 62,390 5,003
Pfizer 33,760 4,684
Schering Plough 44,810 2,479
---------
Total Drugs 19,754
---------
- --------------------------------------------------------------------------------
Electronics--3.6%
- --------------------------------------------------------------------------------
General Motors, Cl H* 13,890 701
LSI Logic* 23,340 728
Motorola 32,020 2,345
Xilinx* 27,600 1,120
---------
Total Electronics 4,894
---------
- --------------------------------------------------------------------------------
Entertainment--2.7%
- --------------------------------------------------------------------------------
Time Warner 26,320 1,870
Walt Disney 59,220 1,843
---------
Total Entertainment 3,713
---------
- --------------------------------------------------------------------------------
Financial services--5.5%
- --------------------------------------------------------------------------------
American Express 11,210 1,317
Associates First Capital 13,150 592
Charles Schwab 11,380 1,094
Citigroup 11,650 744
Fannie Mae 15,350 1,063
Freddie Mac 18,270 1,044
Household International 16,000 730
Providian Financial 9,360 1,030
---------
Total Financial services 7,614
---------
- --------------------------------------------------------------------------------
Food, beverage, and tobacco--4.6%
- --------------------------------------------------------------------------------
Anheuser Busch 13,440 1,024
Coca-Cola Company 27,780 1,705
Pepsi Bottling Group* 29,400 638
PepsiCo 49,270 1,931
Seagram 20,590 1,029
---------
Total Food, beverage, and tobacco 6,327
---------
- --------------------------------------------------------------------------------
Gas/natural gas--0.8%
- --------------------------------------------------------------------------------
Enron 16,660 1,070
---------
Total Gas/natural gas 1,070
---------
Value
Shares (000)
- --------------------------------------------------------------------------------
Glass products--0.5%
- --------------------------------------------------------------------------------
Corning 11,650 $ 699
---------
Total Glass products 699
---------
- --------------------------------------------------------------------------------
Household products--5.0%
- --------------------------------------------------------------------------------
General Electric 62,690 6,935
---------
Total Household products 6,935
---------
- --------------------------------------------------------------------------------
Insurance--0.8%
- --------------------------------------------------------------------------------
American International Group 8,450 1,019
---------
Total Insurance 1,019
---------
- --------------------------------------------------------------------------------
Machinery--1.2%
- --------------------------------------------------------------------------------
Applied Materials* 27,170 1,676
---------
Total Machinery 1,676
---------
- --------------------------------------------------------------------------------
Medical products and services--3.2%
- --------------------------------------------------------------------------------
Amgen* 31,870 2,386
Bausch & Lomb 10,530 684
Guidant* 22,670 1,372
---------
Total Medical products and services 4,442
---------
- --------------------------------------------------------------------------------
Miscellaneous business services--3.3%
- --------------------------------------------------------------------------------
At Home, Cl A* 5,100 803
Automatic Data Processing 17,040 705
BMC Software* 18,830 698
Ebay* 4,160 571
Network Solutions, Cl A* 5,920 626
Novell* 44,220 1,114
---------
Total Miscellaneous business services 4,517
---------
- --------------------------------------------------------------------------------
Miscellaneous consumer products--3.5%
- --------------------------------------------------------------------------------
Clorox 11,300 1,324
Johnson & Johnson 37,330 3,497
---------
Total Miscellaneous consumer products 4,821
---------
- --------------------------------------------------------------------------------
Miscellaneous manufacturing--1.5%
- --------------------------------------------------------------------------------
Tyco International Limited 28,780 2,065
---------
Total Miscellaneous manufacturing 2,065
---------
- --------------------------------------------------------------------------------
Retail--12.0%
- --------------------------------------------------------------------------------
Amazon.com* 3,740 644
American Stores 29,120 961
Best Buy* 14,060 731
Costco* 11,410 1,045
Dayton Hudson 14,790 985
TURNER FUNDS 1999 SEMIANNUAL REPORT | 21
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of net assets
Turner Growth Equity Fund
Value
Shares (000)
- --------------------------------------------------------------------------------
Gap 15,670 $ 1,055
Home Depot 34,040 2,119
Lowe's 16,550 1,001
McDonald's 23,170 1,050
Safeway* 34,710 1,781
TJX 19,520 664
Tricon Global Restaurants* 10,150 713
Wal-Mart Stores 31,980 2,948
Walgreen 31,920 902
---------
Total Retail 16,599
---------
- --------------------------------------------------------------------------------
Semiconductors/instruments--4.7%
- --------------------------------------------------------------------------------
Intel 40,540 4,819
KLA-Tencor* 15,260 741
Texas Instruments 9,480 941
---------
Total Semiconductors/instruments 6,501
---------
- --------------------------------------------------------------------------------
Telephones and telecommunication--3.8%
- --------------------------------------------------------------------------------
AT&T 15,056 1,202
MCI WorldCom* 24,960 2,211
Metromedia Fiber Network, Cl A* 13,680 709
Qwest Communications
International* 15,800 1,139
---------
Total Telephones and telecommunication 5,261
---------
- --------------------------------------------------------------------------------
Total Common stocks (cost $111,654) 137,112
- --------------------------------------------------------------------------------
Shares/face Value
amount (000) (000)
- --------------------------------------------------------------------------------
Repurchase agreement--0.5%
- --------------------------------------------------------------------------------
Morgan Stanley, 4.95%, dated 03/31/99,
matures 4/01/98, repurchase price
$741,670 (collateralized by U.S.
Treasury Note, par value $739,335,
5.625%, matures 10/31/99,
market value $760,212) $742 $742
- --------------------------------------------------------------------------------
Total Repurchase agreement
(cost $742) 742
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total investments--99.9%
(cost $112,396) 137,854
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Other assets and liabilities, net: 0.1% 147
- --------------------------------------------------------------------------------
Net assets:
Portfolio shares (unlimited authorization
--no par value) based on 8,841,515
outstanding shares of beneficial interest 90,670
Accumulated net investment loss (238)
Accumulated net realized
gain on investments 22,111
Net unrealized appreciation
on investments 25,458
- --------------------------------------------------------------------------------
Total net assets--100.0% $138,001
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net asset value, offering and
redemption price per share $15.61
- --------------------------------------------------------------------------------
*Non-income producing security
Cl - Class
The accompanying notes are an integral part of the financial statements.
22 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
Statement of net assets
Turner Midcap Growth Fund
March 31, 1999
Value
Shares (000)
- --------------------------------------------------------------------------------
Common stocks--90.7%
- --------------------------------------------------------------------------------
Air transportation--1.8%
- --------------------------------------------------------------------------------
Delta Air Lines 10,070 $ 700
US Airways Group* 7,530 368
---------
Total Air transportation 1,068
---------
- --------------------------------------------------------------------------------
Apparel/textiles--0.8%
- --------------------------------------------------------------------------------
Tommy Hilfiger* 7,340 506
---------
Total Apparel/textiles 506
---------
- --------------------------------------------------------------------------------
Banks--3.3%
- --------------------------------------------------------------------------------
Firstar 6,090 545
North Fork Bancorporation 18,650 394
Northern Trust 5,860 520
Zions Bancorp 8,255 549
---------
Total Banks 2,008
---------
- --------------------------------------------------------------------------------
Broadcasting, newspapers, and advertising--5.7%
- --------------------------------------------------------------------------------
Cablevision Systems, Cl A* 5,750 426
Harte-Hanks 15,000 412
Omnicom Group 10,610 848
Outdoor Systems* 23,421 703
TMP Worldwide* 7,400 480
Young & Rubicam* 13,540 552
---------
Total Broadcasting,
newspapers, and advertising 3,421
---------
- --------------------------------------------------------------------------------
Car rental--0.7%
- --------------------------------------------------------------------------------
Hertz, Cl A 7,700 412
---------
Total Car rental 412
---------
- --------------------------------------------------------------------------------
Computers and services--6.4%
- --------------------------------------------------------------------------------
Jabil Circuit* 9,240 374
Network Appliance* 10,200 516
New Era of Networks* 5,280 358
SunGard Data Systems* 6,050 242
Teradyne* 12,340 673
Veritas Software* 6,440 520
Visual Networks* 10,710 400
Yahoo* 4,570 769
---------
Total Computers and services 3,852
---------
<PAGE>
Value
Shares (000)
- --------------------------------------------------------------------------------
Drugs--2.6%
- --------------------------------------------------------------------------------
Biogen* 4,750 $ 543
Cardinal Health 7,470 493
Forest Laboratories* 9,310 525
---------
Total Drugs 1,561
---------
- --------------------------------------------------------------------------------
Electronics--2.3%
- --------------------------------------------------------------------------------
General Motors, Cl H* 7,510 379
LSI Logic* 14,090 439
Xilinx* 13,440 545
---------
Total Electronics 1,363
---------
- --------------------------------------------------------------------------------
Financial services--5.1%
- --------------------------------------------------------------------------------
Bear Stearns 8,500 380
Capital One Financial 4,810 726
Charles Schwab 12,560 1,207
Providian Financial 7,030 773
---------
Total Financial services 3,086
---------
- --------------------------------------------------------------------------------
Food, beverage, and tobacco--1.5%
- --------------------------------------------------------------------------------
Adolph Coors, Cl B 11,680 631
Pepsi Bottling Group* 12,390 269
---------
Total Food, beverage, and tobacco 900
---------
- --------------------------------------------------------------------------------
Glass products--1.1%
- --------------------------------------------------------------------------------
Corning 11,380 683
---------
Total Glass products 683
---------
- --------------------------------------------------------------------------------
Household furniture and fixtures--0.5%
- --------------------------------------------------------------------------------
Ethan Allen Interiors 6,510 271
---------
Total Household furniture and fixtures 271
---------
- --------------------------------------------------------------------------------
Insurance--0.9%
- --------------------------------------------------------------------------------
Jefferson Pilot 7,860 532
---------
Total Insurance 532
---------
- --------------------------------------------------------------------------------
Lumber and wood products--0.8%
- --------------------------------------------------------------------------------
Georgia-Pacific Group 6,790 504
---------
Total Lumber and wood products 504
---------
- --------------------------------------------------------------------------------
Machinery--0.9%
- --------------------------------------------------------------------------------
Baker Hughes 22,000 535
---------
Total Machinery 535
---------
- --------------------------------------------------------------------------------
Measuring devices--0.9%
- --------------------------------------------------------------------------------
Waters* 4,870 512
---------
Total Measuring devices 512
---------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 23
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of net assets
Turner Midcap Growth Fund
Value
Shares (000)
- --------------------------------------------------------------------------------
Medical products and services--6.7%
- --------------------------------------------------------------------------------
Allergan 6,350 $ 558
Bausch & Lomb 11,400 741
Biomet* 10,440 438
C.R. Bard 7,530 380
Guidant* 11,490 695
Patterson Dental* 12,200 528
Visx* 6,550 705
---------
Total Medical products and services 4,045
---------
- --------------------------------------------------------------------------------
Miscellaneous business services--16.8%
- --------------------------------------------------------------------------------
At Home, Cl A* 4,200 661
Bisys Group* 6,245 351
BMC Software* 7,160 265
Ceridian* 9,060 331
CMG Information Services * 1,970 361
CSG Systems International* 15,230 601
Doubleclick* 3,830 697
Ebay* 2,820 387
E*Trade Group* 6,650 388
Exodus Communications* 4,590 617
Fiserv* 9,830 527
Ims Health 12,450 412
InfoSpace.com* 4,490 398
Intuit* 3,860 393
iVillage* 4,640 466
Lycos* 7,570 651
Network Solutions, Cl A* 6,650 703
Novell* 16,230 409
Peregrine Systems* 14,320 481
Priceline.com* 5,740 476
RealNetworks* 4,460 545
---------
Total Miscellaneous business services 10,120
---------
- --------------------------------------------------------------------------------
Miscellaneous consumer products--2.0%
- --------------------------------------------------------------------------------
Clorox 4,420 518
Dial 20,000 687
---------
Total Miscellaneous consumer products 1,205
---------
- --------------------------------------------------------------------------------
Miscellaneous manufacturing--0.6%
- --------------------------------------------------------------------------------
Ecolab 10,580 376
---------
Total Miscellaneous manufacturing 376
---------
- --------------------------------------------------------------------------------
Paper and paper products--1.0%
- --------------------------------------------------------------------------------
Smurfit-Stone Container* 32,450 627
---------
Total Paper and paper products 627
---------
Value
Shares (000)
- --------------------------------------------------------------------------------
Petroleum and fuel products--0.6%
- --------------------------------------------------------------------------------
Anadarko Petroleum 9,890 $ 373
---------
Total Petroleum and fuel products 373
---------
- --------------------------------------------------------------------------------
Petroleum refining--0.7%
- --------------------------------------------------------------------------------
Valero Energy 17,697 440
---------
Total Petroleum refining 440
---------
- --------------------------------------------------------------------------------
Retail--13.7%
- --------------------------------------------------------------------------------
Abercrombie & Fitch, Cl A* 5,435 500
Amazon.com* 4,700 809
American Eagle Outfitters* 5,830 418
AnnTaylor Stores* 12,370 547
Bed Bath & Beyond* 16,390 598
Best Buy* 13,050 679
Brinker International* 25,310 653
Circuit City Stores 6,860 526
Dollar Tree Stores* 7,681 238
Linens N Things* 11,470 520
Office Depot* 13,990 515
Outback Steakhouse* 12,085 396
Papa John's International* 8,540 377
Staples* 18,370 604
Tiffany & Company 6,990 522
Tricon Global Restaurants* 5,520 388
---------
Total Retail 8,290
---------
- --------------------------------------------------------------------------------
Rubber and plastic--0.6%
- --------------------------------------------------------------------------------
Sealed Air* 7,865 387
---------
Total Rubber and plastic 387
---------
- --------------------------------------------------------------------------------
Semiconductors/instruments--6.5%
- --------------------------------------------------------------------------------
E-Tek Dynamics* 16,560 594
KLA-Tencor* 8,460 411
Lam Research* 8,680 252
Mips Technologies* 9,710 592
Novellus Systems* 8,190 451
PMC-Sierra* 5,940 423
QLogic* 4,820 324
RF Micro Devices* 5,010 479
Vitesse Semiconductor* 8,090 410
---------
Total Semiconductors/instruments 3,936
---------
- --------------------------------------------------------------------------------
Steel and steel works--0.5%
- --------------------------------------------------------------------------------
AK Steel Holding 13,960 315
---------
Total Steel and steel works 315
---------
- --------------------------------------------------------------------------------
Telephones and telecommunication--2.9%
- --------------------------------------------------------------------------------
Covad Communications Group* 4,020 264
24 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
Shares/face Value
amount (000) (000)
- --------------------------------------------------------------------------------
Geotel Communications* 9,450 $ 434
Level 3 Communications* 3,900 284
Metromedia Fiber Network, Cl A* 7,840 406
Qwest Communications
International* 4,740 342
---------
Total Telephones and telecommunication 1,730
---------
- --------------------------------------------------------------------------------
Testing laboratories--0.9%
- --------------------------------------------------------------------------------
Medimmune* 9,100 539
---------
Total Testing laboratories 539
---------
- --------------------------------------------------------------------------------
Wholesale--1.9%
- --------------------------------------------------------------------------------
Amerisource Health* 12,440 425
US Foodservice* 15,330 713
---------
Total Wholesale 1,138
---------
- --------------------------------------------------------------------------------
Total Common stocks (cost $43,924) 54,735
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Repurchase agreement--9.0%
- --------------------------------------------------------------------------------
J.P. Morgan 4.95%, dated 03/31/99,
matures 04/01/99, repurchase price
$5,410,857 (collateralized by
GNMA, par value $5,522,502,
6.50%, matures 02/15/29, market
value $5,519,075) $5,411 5,411
- --------------------------------------------------------------------------------
Total Repurchase agreement
(cost $5,411) 5,411
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total investments--99.7%
(cost $49,335) 60,146
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Other assets and liabilities, net: 0.3% 163
- --------------------------------------------------------------------------------
Net assets:
Portfolio shares (unlimited authorization
--no par value) based on 2,846,350
outstanding shares of beneficial interest 45,689
Accumulated net investment loss (105)
Accumulated net realized
gain on investments 3,914
Net unrealized appreciation
on investments 10,811
- --------------------------------------------------------------------------------
Total net assets--100.0% $60,309
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net asset value, offering and
redemption price per share $21.19
- --------------------------------------------------------------------------------
*Non-income producing security
Cl - Class
The accompanying notes are an integral part of the financial statements.
Statement of net assets
Turner Small Cap Growth Fund
March 31, 1999
Value
Shares (000)
- --------------------------------------------------------------------------------
Common stocks--98.6%
- --------------------------------------------------------------------------------
Air transportation--1.3%
- --------------------------------------------------------------------------------
Atlas Air* 58,290 $ 1,679
Skywest 30,900 892
---------
Total Air transportation 2,571
---------
- --------------------------------------------------------------------------------
Apparel/textiles--0.4%
- --------------------------------------------------------------------------------
Mohawk Industries* 27,270 818
---------
Total Apparel/textiles 818
---------
- --------------------------------------------------------------------------------
Automotive--0.8%
- --------------------------------------------------------------------------------
Avis Rent A Car* 53,580 1,483
---------
Total Automotive 1,483
---------
- --------------------------------------------------------------------------------
Banks--2.9%
- --------------------------------------------------------------------------------
Astoria Financial 28,890 1,444
City National 50,840 1,570
Golden State Bancorp* 62,480 1,390
Hubco 40,350 1,354
---------
Total Banks 5,758
---------
- --------------------------------------------------------------------------------
Broadcasting, newspapers, and advertising--3.3%
- --------------------------------------------------------------------------------
Adelphia Communications, Cl A* 33,020 2,080
Antec* 43,400 933
Lamar Advertising* 24,390 828
TMP Worldwide* 39,600 2,567
---------
Total Broadcasting, newspapers,
and advertising 6,408
---------
- --------------------------------------------------------------------------------
Building and construction--1.0%
- --------------------------------------------------------------------------------
Jacobs Engineering Group* 48,230 1,902
---------
Total Building and construction 1,902
---------
- --------------------------------------------------------------------------------
Communications equipment--1.2%
- --------------------------------------------------------------------------------
Concord Communications* 27,100 1,545
Polycom* 38,820 728
---------
Total Communications equipment 2,273
---------
- --------------------------------------------------------------------------------
Computers and services--5.4%
- --------------------------------------------------------------------------------
Advantage Learning Systems* 38,740 1,203
Network Appliance* 32,240 1,632
New Era of Networks* 19,270 1,305
Powerwave Technologies* 50,040 1,420
Sandisk* 42,870 1,136
TURNER FUNDS 1999 SEMIANNUAL REPORT | 25
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Value
Shares (000)
- --------------------------------------------------------------------------------
TSI International Software* 27,110 $ 1,323
Visual Networks* 70,360 2,630
---------
Total Computers and services 10,649
---------
- --------------------------------------------------------------------------------
Consumer products--0.8%
- --------------------------------------------------------------------------------
Ferro 61,210 1,515
---------
Total Consumer products 1,515
---------
- --------------------------------------------------------------------------------
Drugs--1.8%
- --------------------------------------------------------------------------------
Alpharma, Cl A 40,760 1,600
Jones Pharmaceuticals 54,110 1,880
---------
Total Drugs 3,480
---------
- --------------------------------------------------------------------------------
Electronics--0.5%
- --------------------------------------------------------------------------------
Electro Scientific Industries* 21,500 1,000
---------
Total Electronics 1,000
---------
- --------------------------------------------------------------------------------
Environmental services--0.6%
- --------------------------------------------------------------------------------
Calpine* 30,900 1,126
---------
Total Environmental services 1,126
---------
- --------------------------------------------------------------------------------
Financial services--3.1%
- --------------------------------------------------------------------------------
CMAC Investment 21,780 849
Knight/Trimark Group, Cl A* 22,790 1,527
Legg Mason 31,880 1,074
Metris 28,870 1,166
NCO Group* 40,590 1,502
---------
Total Financial services 6,118
---------
- --------------------------------------------------------------------------------
Food, beverage, and tobacco--1.1%
- --------------------------------------------------------------------------------
Aurora Foods* 56,980 933
Suiza Foods* 33,990 1,145
---------
Total Food, beverage, and tobacco 2,078
---------
- --------------------------------------------------------------------------------
Insurance--2.9%
- --------------------------------------------------------------------------------
Annuity & Life Re Holdings 40,200 920
Financial Security
Assurance Holdings 29,640 1,471
Mutual Risk Management 55,750 2,132
Reinsurance Group of America 27,795 1,183
---------
Total Insurance 5,706
---------
Value
Shares (000)
- --------------------------------------------------------------------------------
Machinery--1.4%
- --------------------------------------------------------------------------------
Brooks Automation* 45,480 $ 1,018
SPX 32,660 1,647
---------
Total Machinery 2,665
---------
- --------------------------------------------------------------------------------
Measuring devices--1.5%
- --------------------------------------------------------------------------------
Advanced Energy Industries* 54,040 1,273
Mettler-Toledo International* 70,330 1,741
---------
Total Measuring devices 3,014
---------
- --------------------------------------------------------------------------------
Medical products and services--9.5%
- --------------------------------------------------------------------------------
Advanced Paradigm* 29,250 1,848
Alternative Living Services* 50,070 1,001
Conmed* 48,420 1,501
Covance* 70,400 1,764
Express Scripts* 13,130 1,128
Hooper Holmes 68,100 1,064
IDEXX Laboratories* 54,310 1,300
Minimed* 9,380 953
Patterson Dental* 53,900 2,331
Resmed* 12,810 362
TLC Laser Center* 40,000 1,287
Trigon Healthcare* 37,930 1,299
Visx* 17,760 1,910
Xomed Surgical Products* 24,500 962
---------
Total Medical products and services 18,710
---------
- --------------------------------------------------------------------------------
Miscellaneous business services--21.8%
- --------------------------------------------------------------------------------
Acnielsen* 36,720 996
Affiliated Computer Services, Cl A* 21,660 991
Autoweb.com* 33,590 1,197
Bisys Group* 40,260 2,265
C-Net* 15,790 1,455
Checkfree Holdings* 34,670 1,476
Critical Path* 15,970 1,230
CSG Systems International* 45,960 1,813
Digital River* 20,660 826
Doubleclick* 13,100 2,385
E*Trade Group* 23,250 1,356
Electronics for Imaging* 52,830 2,060
Exodus Communications* 21,040 2,830
Infoseek* 18,970 1,404
iVillage* 21,670 2,178
Macromedia* 49,600 2,247
Metzler Group* 4,250 133
Micromuse* 33,080 1,522
Miningo.com* 16,400 1,468
Multex.com* 40,570 2,536
26 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
Value
Shares (000)
- --------------------------------------------------------------------------------
Netgravity* 30,880 $ 1,278
Network Solutions, Cl A* 8,930 944
Onemain.com* 22,600 819
Peregrine Systems* 55,820 1,877
Profit Recovery Group International* 57,010 2,252
Psinet* 25,340 1,078
RealNetworks* 17,240 2,106
---------
Total Miscellaneous business services 42,722
---------
- --------------------------------------------------------------------------------
Miscellaneous consumer products--0.7%
- --------------------------------------------------------------------------------
Regis 51,240 1,364
---------
Total Miscellaneous consumer products 1,364
---------
- --------------------------------------------------------------------------------
Paper and paper products--1.2%
- --------------------------------------------------------------------------------
Smurfit-Stone Container* 126,840 2,450
---------
Total Paper and paper products 2,450
---------
- --------------------------------------------------------------------------------
Petroleum and fuel products--2.3%
- --------------------------------------------------------------------------------
Global Industries* 143,020 1,448
Ocean Energy* 163,022 1,111
Petroleum Geo Services*, ADR 50,790 775
Veritas DGC* 82,580 1,172
---------
Total Petroleum and fuel products 4,506
---------
- --------------------------------------------------------------------------------
Professional services--1.8%
- --------------------------------------------------------------------------------
Consolidated Graphics* 18,990 1,097
Education Management* 48,900 1,504
FYI* 26,780 857
---------
Total Professional services 3,458
---------
- --------------------------------------------------------------------------------
Retail--8.1%
- --------------------------------------------------------------------------------
99 Cents Only Stores* 49,000 2,079
American Eagle Outfitters* 18,380 1,318
AnnTaylor Stores* 39,820 1,760
Children's Place* 55,970 1,508
Claire's Stores 37,060 1,116
Cost Plus* 38,400 1,128
CSK Auto* 33,200 994
Foodmaker* 54,230 1,383
Linens N Things* 48,740 2,212
Papa John's International* 32,040 1,414
Ruby Tuesday 50,930 885
---------
Total Retail 15,797
---------
Value
Shares (000)
- --------------------------------------------------------------------------------
Semiconductors/instruments--8.6%
- --------------------------------------------------------------------------------
Applied Micro Circuits* 35,570 $ 1,521
Genesis Microchip* 37,290 886
Lam Research* 59,210 1,717
MIPS Technologies* 56,290 3,434
Novellus Systems* 18,140 1,000
PMC-Sierra* 23,060 1,642
QLogic* 25,560 1,716
RF Micro Devices* 20,900 2,000
TranSwitch* 36,810 1,666
Ultratech Stepper* 92,560 1,307
---------
Total Semiconductors/instruments 16,889
---------
- --------------------------------------------------------------------------------
Specialty construction--1.2%
- --------------------------------------------------------------------------------
Gaylord Container* 132,230 992
United Rentals* 49,660 1,415
---------
Total Specialty construction 2,407
---------
- --------------------------------------------------------------------------------
Steel and steel works--1.0%
- --------------------------------------------------------------------------------
AK Steel Holding 85,300 1,925
---------
Total Steel and steel works 1,925
---------
- --------------------------------------------------------------------------------
Technology, services--1.0%
- --------------------------------------------------------------------------------
Devry* 68,670 1,991
---------
Total Technology, services 1,991
---------
- --------------------------------------------------------------------------------
Telephones and telecommunication--9.6%
- --------------------------------------------------------------------------------
Commscope* 94,680 1,982
Concentric Network* 24,400 1,824
Dycom Industries* 34,210 1,488
Geotel Communications* 46,430 2,130
Gilat Satellite Networks Limited* 17,500 1,050
Intermedia
Communications of Florida* 40,450 1,077
L-3 Communications Corp* 38,120 1,763
Nextlink Communications* 24,520 1,373
RNC Corportion* 58,880 1,976
Viatel* 34,050 970
Western Wireless, Cl A* 50,320 1,824
Winstar Communications* 39,140 1,422
---------
Total Telephones and telecommunication 18,879
---------
- --------------------------------------------------------------------------------
Wholesale--1.8%
- --------------------------------------------------------------------------------
Amerisource Health* 37,300 1,275
Aviation Sales* 20,650 919
Priority Healthcare, Cl B* 30,680 1,388
---------
Total Wholesale 3,582
---------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 27
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of net assets
Turner Small Cap Growth Fund
Face amount Value
(000) (000)
- --------------------------------------------------------------------------------
Total Common stocks (cost $152,266) $193,244
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Repurchase agreement--0.5%
- --------------------------------------------------------------------------------
Morgan Stanley 4.95%, dated 03/31/99,
matures 4/01/99, repurchase price
$887,846 (collateralized by U.S.
Treasury Note, par value $885,052,
5.625%, matures 10/31/99, market
value $910,042) $888 888
- --------------------------------------------------------------------------------
Total Repurchase agreement
(cost $888) 888
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total investments--99.1%
(cost $153,154) 194,132
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Other assets and liabilities, net: 0.9% 1,821
- --------------------------------------------------------------------------------
Net assets:
Portfolio shares (unlimited authorization
--no par value) based on
6,896,724 outstanding shares
of beneficial interest 151,348
Accumulated net investment loss (861)
Accumulated net realized
gain on investments 4,488
Net unrealized appreciation
on investments 40,978
- --------------------------------------------------------------------------------
Total net assets--100.0% $195,953
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net asset value, offering and
redemption price per share $28.41
- --------------------------------------------------------------------------------
*Non-income producing security
ADR - American Depository Receipt
Cl - Class
The accompanying notes are an integral part of the financial statements.
Statement of net assets
Turner Micro Cap Growth Fund
March 31, 1999
Value
Shares (000)
- --------------------------------------------------------------------------------
Common stocks--99.3%
- --------------------------------------------------------------------------------
Banks--1.3%
- --------------------------------------------------------------------------------
First Oak Brook 1,040 $ 18
Flushing Financial 2,110 30
Trico Bancshares 2,000 32
---------
Total Banks 80
---------
- --------------------------------------------------------------------------------
Beauty products--0.8%
- --------------------------------------------------------------------------------
Styling Technology* 3,700 47
---------
Total Beauty Products 47
---------
- --------------------------------------------------------------------------------
Building and construction--1.9%
- --------------------------------------------------------------------------------
M.D.C. Holdings 1,900 27
National R.V. Holdings* 2,650 59
UNIFAB International* 3,600 29
---------
Total Building and construction 115
---------
- --------------------------------------------------------------------------------
Building and construction supplies--2.9%
- --------------------------------------------------------------------------------
Dayton Superior* 2,000 35
Elcor 1,170 41
Mobile Mini* 4,400 57
NVR* 980 41
---------
Total Building and construction supplies 174
---------
- --------------------------------------------------------------------------------
Communications equipment--1.3%
- --------------------------------------------------------------------------------
Teltrend* 1,400 22
Tut Systems* 1,200 60
---------
Total Communications equipment 82
---------
- --------------------------------------------------------------------------------
Computers and services--8.2%
- --------------------------------------------------------------------------------
Ardent Software* 2,100 34
Avt Corp* 2,230 53
Clarify* 1,300 35
Cybex Computer Products* 1,350 24
Fourth Shift* 6,400 34
Netplex Group* 20,200 67
Pinnacle Systems* 900 41
Smith-Gardner and Associates* 3,200 45
Symix Systems* 1,050 16
TSI International Software* 840 41
Unify* 4,100 62
Verity* 1,300 44
---------
Total Computers and services 496
---------
28 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
- --------------------------------------------------------------------------------
Value
Shares (000)
- --------------------------------------------------------------------------------
Consumer products--1.5%
- --------------------------------------------------------------------------------
K-Swiss, Cl A 2,000 $ 51
Steven Madden Ltd* 4,700 40
---------
Total Consumer products 91
---------
- --------------------------------------------------------------------------------
Drugs--2.1%
- --------------------------------------------------------------------------------
Kendle International* 2,250 45
Medco Research* 3,100 81
---------
Total Drugs 126
---------
- --------------------------------------------------------------------------------
Electronics--1.0%
- --------------------------------------------------------------------------------
Anaren Microwave* 2,450 59
---------
Total Electronics 59
---------
- --------------------------------------------------------------------------------
Entertainment--2.8%
- --------------------------------------------------------------------------------
Argosy Gaming* 10,000 53
THQ* 3,000 61
WMS Industries* 7,300 56
---------
Total Entertainment 170
---------
- --------------------------------------------------------------------------------
Environmental services--1.9%
- --------------------------------------------------------------------------------
Stericycle* 3,800 51
U.S. Liquids* 3,000 65
---------
Total Environmental services 116
---------
- --------------------------------------------------------------------------------
Financial services--6.4%
- --------------------------------------------------------------------------------
Ace Cash Express* 4,000 51
Creditrust* 6,000 119
Financial Federal* 2,600 49
First Cash* 2,900 26
NCO Group* 1,280 47
Rock Financial 5,400 97
---------
Total Financial services 389
---------
- --------------------------------------------------------------------------------
Food, beverage, and tobacco--2.3%
- --------------------------------------------------------------------------------
Agribrands International* 1,100 36
IL Fornaio American* 5,900 58
WLR Foods* 6,000 44
---------
Total Food, beverage, and tobacco 138
---------
- --------------------------------------------------------------------------------
Gas/natural gas--1.1%
- --------------------------------------------------------------------------------
Cascade Natural Gas 2,100 31
Roanoke Gas 1,700 33
---------
Total Gas/natural gas 64
---------
- --------------------------------------------------------------------------------
Household furniture and fixtures--0.9%
- --------------------------------------------------------------------------------
Pulaski Furniture 850 17
Stanley Furniture* 2,060 40
---------
Total Household furniture and fixtures 57
---------
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
Value
Shares (000)
- --------------------------------------------------------------------------------
Insurance--1.1%
- --------------------------------------------------------------------------------
Farm Family Holdings* 970 $ 31
Penn Treaty American* 1,450 36
---------
Total Insurance 67
---------
- --------------------------------------------------------------------------------
Leasing and renting--1.9%
- --------------------------------------------------------------------------------
Dollar Thrifty Automotive* 4,280 74
Neff 5,500 44
---------
Total Leasing and renting 118
---------
- --------------------------------------------------------------------------------
Machinery--2.6%
- --------------------------------------------------------------------------------
Moog, Cl A* 1,750 53
Photon Dynamics* 13,100 103
---------
Total Machinery 156
---------
- --------------------------------------------------------------------------------
Medical products and services--11.8%
- --------------------------------------------------------------------------------
Advanced Paradigm* 1,700 107
Biomatrix* 1,000 78
Brookdale Living Communities* 3,000 52
CareMatrix* 3,050 58
Empi* 2,500 54
Hooper Holmes 2,000 31
Laser Vision Centers* 2,400 92
Molecular Devices* 2,850 77
Summit Technology* 10,000 110
Syncor International* 2,200 61
---------
Total Medical products and services 720
---------
- --------------------------------------------------------------------------------
Miscellaneous business services--4.9%
- --------------------------------------------------------------------------------
Global Imaging Systems* 2,300 31
Flashnet Communications* 1,100 45
Pervasive Software* 5,000 89
Softnet Systems* 2,700 99
Quanta Services* 1,450 37
---------
Total Miscellaneous business services 301
---------
- --------------------------------------------------------------------------------
Miscellaneous manufacturing--5.5%
- --------------------------------------------------------------------------------
Aeroflex* 5,650 81
Cutter & Buck* 1,500 48
Engineered Support System 1,695 29
Jakks Pacific* 3,050 56
LSI Industries 1,230 21
Monaco Coach* 2,110 49
Quixote 2,900 33
Uniroyal Technology* 2,500 20
---------
Total Miscellaneous manufacturing 337
---------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 29
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of net assets
Turner Micro Cap Growth Fund
- --------------------------------------------------------------------------------
Value
Shares (000)
- --------------------------------------------------------------------------------
Petroleum and fuel products--2.0%
- --------------------------------------------------------------------------------
HS Resources* 7,000 $ 61
UTI Energy* 5,900 63
---------
Total Petroleum and fuel products 124
---------
- --------------------------------------------------------------------------------
Professional services--0.8%
- --------------------------------------------------------------------------------
BI* 5,400 51
---------
Total professional services 51
---------
- --------------------------------------------------------------------------------
Research and development--0.8%
- --------------------------------------------------------------------------------
Aurora Biosciences* 7,200 48
---------
Total research and development 48
---------
- --------------------------------------------------------------------------------
Retail--13.7%
- --------------------------------------------------------------------------------
Building Materials Holding* 5,950 60
Cheap Tickets* 2,300 77
Chico's Fas* 2,500 54
Children's Place* 2,200 59
Delia's* 2,500 79
E4L* 7,200 61
Garden Fresh Restaurant* 4,050 58
Noodle Kidoodle* 8,200 54
NPC International* 3,700 58
Roadhouse Grill * 5,600 34
Rush Enterprises* 3,800 43
Shop At Home* 6,300 79
Sports Authority* 9,500 69
Taco Cabana, Cl A* 5,500 49
---------
Total Retail 834
---------
- --------------------------------------------------------------------------------
Semiconductors/instruments--3.1%
- --------------------------------------------------------------------------------
ESS Technology* 5,300 27
Genesis Microchip* 1,400 33
Park Electrochemical 1,600 38
TranSwitch* 1,100 50
Zoran* 2,500 41
---------
Total Semiconductors/instruments 189
---------
- --------------------------------------------------------------------------------
Specialty construction--1.5%
- --------------------------------------------------------------------------------
Gaylord Container* 12,000 90
---------
Total Specialty construction 90
---------
30 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
- --------------------------------------------------------------------------------
Value
Shares (000)
- --------------------------------------------------------------------------------
Telephones and telecommunication--3.8%
- --------------------------------------------------------------------------------
Audiovox, Cl A* 8,600 $ 57
Boston Communications Group* 4,950 48
Com21* 1,100 29
Metro One Telecommunications* 4,500 64
Microwave Power Devices* 4,500 36
---------
Total Telephones and telecommunication 234
---------
- --------------------------------------------------------------------------------
Transportation services--1.6%
- --------------------------------------------------------------------------------
Forward Air* 7,600 100
---------
Total Transportation services 100
---------
- --------------------------------------------------------------------------------
Water utilities--1.6%
- --------------------------------------------------------------------------------
Artesian Resources, Class A 2,200 55
E'town 1,000 40
---------
Total Water utilities 95
---------
- --------------------------------------------------------------------------------
Wholesale--6.2%
- --------------------------------------------------------------------------------
Advanced Marketing Systems 3,755 49
Craftwood International 5,050 76
D&K Healthcare Resources* 3,700 92
Golden State Vintners* 4,650 56
Miami Computer Supply* 3,200 64
Sodak Gaming* 4,500 40
---------
Total Wholesale 377
---------
- --------------------------------------------------------------------------------
Total Common stocks (cost $5,417) 6,045
- --------------------------------------------------------------------------------
30 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
Face amount Value
(000) (000)
- --------------------------------------------------------------------------------
Repurchase agreement--2.1%
- --------------------------------------------------------------------------------
Morgan Stanley, 4.50%, dated 03/31/99,
matures 04/01/99, repurchase price
$128,196 (collateralized by U.S.
Treasury Notes, par value $127,790,
5.625%, matures 10/31/99, market
value $131,401) $128 $128
- --------------------------------------------------------------------------------
Total Repurchase agreement
(cost $128) 128
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total investments--101.4%
(cost $5,545) 6,173
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Other assets and liabilities,
net: (1.4%) (88)
- --------------------------------------------------------------------------------
Net assets:
Portfolio shares (unlimited authorization
--no par value) based on 422,102
outstanding shares of beneficial interest 4,711
Accumulated net investment loss (15)
Accumulated net realized gain on investments 761
Net unrealized appreciation on investments 628
- --------------------------------------------------------------------------------
Total net assets--100.0% $6,085
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net asset value, offering and
redemption price per share $14.42
- --------------------------------------------------------------------------------
*Non-income producing security.
Cl - Class
The accompanying notes are an integral part of the financial statements.
Statement of net assets
Turner Short Duration Government Funds-
Three Year Portfolio
March 31, 1999
- --------------------------------------------------------------------------------
Face amount Value
(000) (000)
- --------------------------------------------------------------------------------
U.S. Treasury obligations--46.7%
- --------------------------------------------------------------------------------
U.S. Treasury Notes
5.500%, 05/31/2000 3,681 $ 3,703
U.S. Treasury Notes
5.750%, 10/31/2000 700 708
U.S. Treasury Notes
5.000%, 02/28/2001 1,865 1,864
U.S. Treasury Notes
6.250%, 06/30/2002 2,432 2,510
- --------------------------------------------------------------------------------
Total U.S. Treasury obligations
(Cost $8,802) 8,785
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Collateralized mortgage obligations--12.6%
- --------------------------------------------------------------------------------
Citicorp Mortgage Securities,
Ser 1994-10, Cl A4
6.250%, 06/25/2024 213 212
Countrywide Home Loans,
Ser 1997-2, Cl A11
7.500%, 04/25/2027 1,154 1,155
Prudential Securities Secured
Financing, Ser 1999-NRF1,
Cl A2, 6.480%, 01/15/2009 425 428
Structured Asset Securities,
Ser 1997-2, Cl 1A (A)
7.149%, 10/30/2007 572 575
- --------------------------------------------------------------------------------
Total Collateralized mortgage
obligations, (Cost $2,372) 2,370
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Asset-backed securities--5.8%
- --------------------------------------------------------------------------------
Advanta Credit Card Master Trust,
Ser 1993-4, Cl A (A)
5.250%, 12/31/2000 52 52
Contimortgage Home Equity
Loan Trust, Ser 1996-2, Cl A5
7.050%, 04/15/2011 596 596
Goldman Sachs Mortgage Securities,
Ser 1998-C1, Cl A1
6.060%, 10/18/2030 194 194
Olympic Automobile Receivables Trust,
Ser 1996-A, Cl A5
6.000%, 02/15/2002 250 251
- --------------------------------------------------------------------------------
Total Asset-backed securities (Cost $1,097) 1,093
- --------------------------------------------------------------------------------
TURNER FUNDS 1999 SEMIANNUAL REPORT | 31
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of net assets
Turner Short Duration Government Funds-
Three Year Portfolio
Face amount Value
(000) (000)
- --------------------------------------------------------------------------------
U.S. government agency
obligations--6.8%
- --------------------------------------------------------------------------------
FNMA, 5.125%, 02/13/2004 182 $ 179
FHLMC TBA (B), 6.000%, 03/30/2004 750 745
FNMA Medium Term Notes
6.710%, 03/13/2002 360 365
- --------------------------------------------------------------------------------
Total U.S. government agency
obligations (Cost $1,283) 1,289
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
U.S. government
mortgage-backed bonds--26.2%
- --------------------------------------------------------------------------------
FHLMC CMO/REMIC,
Ser 161, Cl F,
9.500%, 06/15/2006 1,043 1,104
FHLMC CMO/REMIC,
Ser 1316, Cl Z
8.000%, 06/15/2022 437 455
FHLMC CMO/REMIC,
Ser 1485, Cl E
6.000%, 12/15/2004 86 86
FHLMC CMO/REMIC,
Ser 1501, Cl F
6.100%, 11/15/2016 436 437
FHLMC Discount Notes,
Pool #G10288
6.000%, 09/01/2009 436 436
FNMA ARM (A), Pool #105435
6.535%, 12/01/2017 1065 5
FNMA, Pool #252209
6.000%, 01/01/2019 1,271 1,246
FNMA, Pool #6222
9.000%, 04/01/2016 325 347
GNMA ARM (A), Pool #28108
6.875%, 03/20/2016 241 246
GNMA ARM (A), Pool #8254
6.625%, 08/20/2017 97 99
GNMA ARM (A), Pool #8426
6.125%, 11/20/2018 215 219
GNMA, Pool #434128
6.500%, 12/15/2028 249 248
- --------------------------------------------------------------------------------
Total U.S. government mortgage-
backed bonds (Cost $4,920) 4,928
- --------------------------------------------------------------------------------
Face amount Value
(000) (000)
- --------------------------------------------------------------------------------
Repurchase agreement--4.6%
- --------------------------------------------------------------------------------
Paine Webber, 4.95%, dated 3/31/99,
matures 04/01/99, repurchase price
$ 868,000 (collateralized by FGLMC,
par value $930,000, 6.50%,
matures 05/15/02, market value
883,509), 4.950, 04/01/1999 $ 868 $ 868
- --------------------------------------------------------------------------------
Total Repurchase agreement
(cost $868) 868
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total investments--102.7%
(cost $19,342) 19,333
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Other assets and liabilities,
net: (2.7%) (512)
- --------------------------------------------------------------------------------
Net assets:
Portfolio shares (unlimited
authorization--no par value)
based on 1,889,940 outstanding
shares of beneficial interest 18,860
Undistributed net investment income 10
Accumulated net realized loss on investments (40)
Net unrealized depreciation on investments (9)
- --------------------------------------------------------------------------------
Total net assets--100.0% $18,821
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net asset value, offering and
redemption price per share $9.96
- --------------------------------------------------------------------------------
(A) Floating Rate Security. The rate reflected on the Statement of Net Assets is
the rate in effect on March 31, 1999.
(B) When issued security
ARM - Adjustable Rate Mortgage
Cl - Class
CMO - Collateralized Mortgage Obligation
FHLMC - Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
GNMA - Government National Mortgage Association
REMIC - Real Estate Mortgage Investment Conduit
Ser - Series
TBA - To be announced
The accompanying notes are an integral part of the financial statements.
32| TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
Statement of net assets
Turner Short Duration Government Funds-
One Year Portfolio
March 31, 1999
Face amount Value
(000) (000)
- --------------------------------------------------------------------------------
Asset-backed securities--12.3%
- --------------------------------------------------------------------------------
Contimortgage Home Equity
Loan Trust, Ser 1996-2, Cl A5
7.050%, 04/15/2011 50 $ 49
Fleet Credit Card Master Trust,
Ser 1998-A, Cl A (A)
4.979%, 07/15/2003 40 40
Nationsbank Credit Card Master Trust,
Ser 1996-1, Cl A (A)
5.150%, 02/15/2006 55 55
- --------------------------------------------------------------------------------
Total Asset-backed securities
(cost $145) 144
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
U.S. Treasury obligations--26.0%
- --------------------------------------------------------------------------------
U.S. Treasury Notes
5.625%, 11/30/1999 180 181
U.S. Treasury Notes
5.500%, 05/31/2000 20 20
U.S. Treasury Notes
5.750%, 10/31/2000 75 76
U.S. Treasury Notes
5.000%, 02/28/2001 26 26
- --------------------------------------------------------------------------------
Total U.S. Treasury obligations
(cost $303) 303
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
U.S. government agency obligations--31.5%
- --------------------------------------------------------------------------------
FFCB Discount Note
4.856%, 04/30/1999 9 9
FHLMC Discount Note
4.800%, 04/01/1999 55 55
FHLMC Discount Note
4.816%, 04/01/1999 80 80
FHLMC Discount Note
4.821%, 04/12/1999 46 46
FHLMC Discount Note
4.840%, 04/06/1999 50 50
FHLMC Discount Note
4.800%, 04/14/1999 110 110
FNMA Discount Note
4.845%, 04/12/1999 17 17
- --------------------------------------------------------------------------------
Total U.S. government agency
obligations (Cost $367) 367
- --------------------------------------------------------------------------------
Face amount Value
(000) (000)
- --------------------------------------------------------------------------------
U.S. government mortgage-backed bonds--28.1%
- --------------------------------------------------------------------------------
FHLMC CMO/REMIC, Ser 161, Cl F
9.500%, 06/15/2006 113 $ 120
FHLMC CMO/REMIC, Ser 1485, Cl E
6.000%, 12/15/2004 3 2
FHLMC CMO/REMIC, Ser 1501, Cl F
6.100%, 11/15/2016 14 14
GNMA ARM (A), Pool #8297
6.125%, 12/20/2017 74 76
GNMA ARM (A), Pool #8462
6.875%, 02/20/2019 44 45
GNMA ARM (A), Pool #8489
6.875%, 04/20/2019 68 70
- --------------------------------------------------------------------------------
Total U.S. government
mortgage-backed bonds (cost $325) 327
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total investments--97.9%
(cost $ 1,140) 1,141
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Other assets and liabilities, net: 2.1% $ 24
- --------------------------------------------------------------------------------
Net assets:
Portfolio shares of institutional class
shares (unlimited authorization--
no par value) based on 100,797
outstanding shares of beneficial interest 1,010
Portfolio shares of adviser shares class
(unlimited authorization--no par
value) based on 14,858 outstanding
shares of beneficial interest 150
Undistributed net investment income 1
Accumulated net realized gain on investments 3
Net unrealized appreciation on investments 1
- --------------------------------------------------------------------------------
Total net assets--100.0% $1,165
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net asset value, offering and
redemption price per share-
institutional class shares $10.07
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net asset value, offering and redemption
price per share-adviser class shares $10.13
- --------------------------------------------------------------------------------
(A) Floating Rate Security. The rate reflected on the Statement of Net Assets is
the rate in effect on March 31, 1999.
ARM - Adjustable Rate Mortgage
Cl - Class
CMO - Collateralized Mortgage Obligation
FFCB - Federal Farm Credit Bank FHLMC -
Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
GNMA - Government National Mortgage Association
REMIC - Real Estate Mortgage Investment Conduit
Ser - Series
The accompanying notes are an integral part of the financial statements.
TURNER FUNDS 1999 SEMIANNUAL REPORT | 33
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of operations (000)
<TABLE>
<CAPTION>
Turner Large Cap Turner Growth Turner Midcap Turner Small Cap
Growth Equity Fund Equity Fund Growth Fund Growth Fund
-----------------------------------------------------------------------------
10/1/98 thru 10/1/98 thru 10/1/98 thru 10/1/98 thru
3/31/99 3/31/99 3/31/99 3/31/99
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investment income:
Dividend $ 17 $ 282 $ 61 $ 137
Interest 2 43 25 80
- ------------------------------------------------------------------------------------------------------------------------------------
Total investment income 19 325 86 217
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses:
Investment advisory fees 24 440 129 862
Investment advisory fee waiver (24) -- (2) (45)
Administrator fees 25 63 30 85
Administrator fee waiver -- -- -- --
Custodian fees 4 -- 5 5
Transfer agent fees 8 -- 8 47
Professional fees 3 40 8 64
Trustee fees -- 3 1 5
Registration fees 14 7 14 38
Pricing fees -- 1 1 1
Printing fees 2 20 5 30
Shareholder service fees -- -- -- --
Amortization of deferred organizational costs 2 2 3 2
Insurance and other fees 1 6 1 9
- ------------------------------------------------------------------------------------------------------------------------------------
Total expenses 59 582 203 1,103
Less: reimbursements from adviser (28) -- -- --
Directed brokerage -- (19) (15) (26)
- ------------------------------------------------------------------------------------------------------------------------------------
Net expenses 31 563 188 1,077
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) (12) (238) (102) (860)
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized gain from securities sold 1,293 22,416 5,460 12,835
Net unrealized appreciation (depreciation)
of investment securities 889 13,293 9,953 36,792
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss)
on investments 2,182 35,709 15,413 49,627
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
resulting from operations $ 2,170 $ 35,471 $ 15,311 $ 48,767
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
34 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Turner Short Duration
Government Funds-
Turner Micro Cap Three Year One Year
Growth Fund Portfolio Portfolio
------------------------------------------------------------------------
10/1/98 thru 10/1/98 thru 10/1/98 thru
3/31/99 3/31/99 3/31/99
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment income:
Dividend $ 7 $ -- $ --
Interest 5 425 23
- ------------------------------------------------------------------------------------------------------------------------------------
Total investment income 12 425 23
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses:
Investment advisory fees 22 18 1
Investment advisory fee waiver (22) (18) (1)
Administrator fees 36 14 --
Administrator fee waiver -- -- --
Custodian fees 3 4 2
Transfer agent fees 10 21 19
Professional fees 14 15 6
Trustee fees 3 9 9
Registration fees 25 25 17
Pricing fees -- 1 1
Printing fees 9 4 2
Shareholder service fees -- -- --
Amortization of deferred organizational costs 1 -- --
Insurance and other fees -- 1 1
- ------------------------------------------------------------------------------------------------------------------------------------
Total expenses 101 94 57
Less: reimbursements from adviser (74) (76) (57)
Directed brokerage -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net expenses 27 18 --
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) (15) 407 23
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized gain from securities sold 808 40 --
Net unrealized appreciation (depreciation)
of investment securities 685 (245) (1)
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss)
on investments 1,493 (205) (1)
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
resulting from operations $ 1,478 $ 202 $ 22
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0
TURNER FUNDS 1999 SEMIANNUAL REPORT | 35
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of changes in net assets (000)
<TABLE>
<CAPTION>
Turner Large Cap Turner Growth Turner Midcap
Growth Equity Fund Equity Fund Growth Fund
--------------------------------------------------------------------------------------
year year year
10/1/98 thru ended 10/1/98 thru ended 10/1/98 thru ended
3/31/99 9/30/98 3/31/99 9/30/98 3/31/99 9/30/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Investment activities:
Net investment (loss) $ (12) $ (2) $ (238) $ (378) $ (102) $ (124)
Net realized gain (loss) from
securities sold 1,293 (170) 22,416 17,188 5,460 (1,546)
Net unrealized appreciation
(depreciation) of investments 889 169 13,293 (7,481) 9,953 524
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in
net assets resulting
from operations 2,170 (3) 35,471 9,329 15,311 (1,146)
- ------------------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income -- (1) -- -- -- --
Realized capital gains -- (72) (12,236) (26,503) -- (358)
Return of capital -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions -- (73) (12,236) (26,503) -- (358)
- ------------------------------------------------------------------------------------------------------------------------------------
Capital share transactions: (1)
Proceeds from shares issued 3,300 3,876 13,339 22,658 29,462 28,977
Proceeds from shares issued in
lieu of cash distributions -- 73 11,874 25,911 -- 320
Cost of shares redeemed (961) (246) (8,304) (33,128) (9,046) (8,356)
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from capital share transactions 2,339 3,703 16,909 15,441 20,416 20,941
- ------------------------------------------------------------------------------------------------------------------------------------
Total increase (decrease)
in net assets 4,509 3,627 40,144 (1,733) 35,727 19,437
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets:
Beginning of year 4,328 701 97,857 99,590 24,582 5,145
- ------------------------------------------------------------------------------------------------------------------------------------
End of year (3) $ 8,837 $ 4,328 $ 138,001 $ 97,857 $ 60,309 $ 24,582
- ------------------------------------------------------------------------------------------------------------------------------------
(1) Shares issued and redeemed:
Issued 199 282 924 1,638 1,579 1,939
Issued in lieu of cash distributions -- 6 890 2,320 -- 24
Redeemed (61) (18) (577) (2,339) (505) (553)
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in
capital shares 138 270 1,237 1,619 1,074 1,410
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0
(2) The Turner Micro Cap Growth Fund commenced operations on March 1, 1998.
(3) Includes undistributed net investment income (loss) and/or distributions in
excess of net investment income (000) of $(12) and $0 for the Large Cap
Growth Equity Fund, $(238) and $0 for the Growth Equity Fund, $(105) and (3)
for the Midcap Growth Fund, $(861) and $(1) for the Small Cap Growth Fund
and $(15) and $0 for the Micro Cap Growth Fund, as of March 31, 1999, and
September 30, 1998, respectively.
36 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Turner Small Cap Turner Micro Cap
Growth Fund Growth Fund
------------------------------------------------------------------
year year
10/1/98 thru ended 10/1/98 thru ended
3/31/99 9/30/98 3/31/99 9/30/98 (2)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investment activities:
Net investment (loss) $ (860) $ (1,609) $ (15) $ (11)
Net realized gain (loss) from
securities sold 12,835 (6,168) 808 (47)
Net unrealized appreciation
(depreciation) of investments 36,792 (22,875) 685 (57)
- -------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in
net assets resulting
from operations 48,767 (30,652) 1,478 (115)
- -------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income -- -- -- --
Realized capital gains -- (1,521) -- --
Return of capital -- (1,148) -- --
- -------------------------------------------------------------------------------------------------------------------
Total distributions -- (2,669) -- --
- -------------------------------------------------------------------------------------------------------------------
Capital share transactions: (1)
Proceeds from shares issued 35,313 96,936 1,893 3,087
Proceeds from shares issued in
lieu of cash distributions -- 2,289 -- --
Cost of shares redeemed (35,661) (71,832) (129) (129)
- -------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from capital share transactions (348) 27,393 1,764 2,958
- -------------------------------------------------------------------------------------------------------------------
Total increase (decrease)
in net assets 48,419 (5,928) 3,242 2,843
- -------------------------------------------------------------------------------------------------------------------
Net assets:
Beginning of year 147,534 153,462 2,843 --
- -------------------------------------------------------------------------------------------------------------------
End of year (3) $ 195,953 $ 147,534 $ 6,085 $ 2,843
- -------------------------------------------------------------------------------------------------------------------
(1) Shares issued and redeemed:
Issued 1,461 3,783 143 300
Issued in lieu of cash distributions -- 99 -- --
Redeemed (1,429) (2,840) (9) (12)
- -------------------------------------------------------------------------------------------------------------------
Net increase in
capital shares 32 1,042 134 288
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
TURNER FUNDS 1999 SEMIANNUAL REPORT | 37
<PAGE>
- --------------------------------------------------------------------------------
Statement of changes in net assets (000)
<TABLE>
<CAPTION>
Turner Short Duration Government Funds-
Three Year Portfolio
-----------------------------------------------------
10/1/98 thru 3/1/98 thru Year ended
3/31/99 9/30/98 2/28/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment activities:
Net investment income $ 407 $ 469 $ 967
Net realized gain from securities sold 40 74 54
Net unrealized appreciation (depreciation) of investments (245) 119 98
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 202 662 1,119
- ------------------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income
Institutional class (407) (461) (966)
Adviser class -- -- --
Realized capital gains
Institutional class (156) (10) --
Adviser class -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (563) (471) (966)
- ------------------------------------------------------------------------------------------------------------------------------------
Capital share transactions: (1)
Institutional class
Proceeds from shares issued 8,359 666 3,854
Proceeds from shares issued in lieu of cash distributions 561 476 967
Cost of shares redeemed (1,753) (4,862) (7,239)
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from
institutional class transactions 7,167 (3,720) (2,418)
- ------------------------------------------------------------------------------------------------------------------------------------
Adviser class
Proceeds from shares issued -- -- --
Proceeds from shares issued in lieu of cash distributions -- -- --
Cost of shares redeemed -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Increase in net assets from
adviser class transactions -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from
capital share transactions 7,167 (3,720) (2,418)
- ------------------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets 6,806 (3,529) (2,265)
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets:
Beginning of year 12,015 15,544 17,809
- ------------------------------------------------------------------------------------------------------------------------------------
End of year (2) $ 18,821 $ 12,015 $ 15,544
- ------------------------------------------------------------------------------------------------------------------------------------
(1) Shares issued and redeemed:
Institutional class
Issued 836 66 383
Issued in lieu of cash distributions 56 47 96
Redeemed (174) (481) (722)
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from institutional class transactions 718 (368) (243)
- ------------------------------------------------------------------------------------------------------------------------------------
Adviser class
Issued -- -- --
Issued in lieu of cash distributions -- -- --
Redeemed -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Increase in net assets from adviser class transactions -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in capital shares 718 (368) (243)
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0
(2) Includes undistributed net investment income (000) of $10, $10 and $2 for
the Three Year Fund, $1, $2 and $0 for the One Year Fund, as of March 31,
1999, September 30, 1998 and February 28, 1998, respectively.
38 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Turner Short Duration Government Funds-
One Year Portfolio
-----------------------------------------------------
10/1/98 thru 3/1/98 thru Year ended
3/31/99 9/30/98 2/28/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment activities:
Net investment income $ 23 $ 37 $ 66
Net realized gain from securities sold -- 1 1
Net unrealized appreciation (depreciation) of investments (1) -- 1
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 22 38 68
- ------------------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income
Institutional class (23) (35) (66)
Adviser class (1) -- --
Realized capital gains
Institutional class -- (1) --
Adviser class -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (24) (36) (66)
- ------------------------------------------------------------------------------------------------------------------------------------
Capital share transactions: (1)
Institutional class
Proceeds from shares issued 704 5 827
Proceeds from shares issued in lieu of cash distributions 23 36 66
Cost of shares redeemed (701) (247) (564)
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from
institutional class transactions 26 (206) 329
- ------------------------------------------------------------------------------------------------------------------------------------
Adviser class
Proceeds from shares issued 196 -- --
Proceeds from shares issued in lieu of cash distributions 1 -- --
Cost of shares redeemed (47) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Increase in net assets from
adviser class transactions 150 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from
capital share transactions 176 (206) 329
- ------------------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets 174 (204) 331
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets:
Beginning of year 991 1,195 864
- ------------------------------------------------------------------------------------------------------------------------------------
End of year (2) $ 1,165 $ 991 $ 1,195
- ------------------------------------------------------------------------------------------------------------------------------------
(1) Shares issued and redeemed:
Institutional class
Issued 70 -- 82
Issued in lieu of cash distributions 2 4 7
Redeemed (69) (25) (56)
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from institutional class transactions 3 (21) 33
- ------------------------------------------------------------------------------------------------------------------------------------
Adviser class
Issued 20 -- --
Issued in lieu of cash distributions -- -- --
Redeemed (5) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Increase in net assets from adviser class transactions 15 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in capital shares 18 (21) 33
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
TURNER FUNDS 1999 SEMIANNUAL REPORT | 39
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Financial highlights
For a share outstanding throughout each period
<TABLE>
<CAPTION>
Net Realized and
asset Net unrealized Distributions Distributions
value, investment gains from net from Net asset
beginning income (losses) on investment capital Return value end
of period (loss) investments income gains of capital of period
- -------------------------------------------------------------------------------------------------------------------------
Turner Large Cap Growth Equity Fund (formerly Turner Ultra Large Cap Growth Fund)
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1999** $ 13.22 (0.03) 5.83 -- -- -- $ 19.02
1998 $ 12.28 (0.01) 1.98 (0.01) (1.02) -- $ 13.22
1997 (1) $ 10.00 0.01 2.27 -- -- -- $ 12.28
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
Turner Growth Equity Fund
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1999** $ 12.87 (0.03) 4.37 -- (1.60) -- $ 15.61
1998 $ 16.64 (0.05) 1.10 -- (4.82) -- $ 12.87
1997 $ 17.03 (0.03) 4.23 -- (4.59) -- $ 16.64
1996 (2) $ 14.97 0.02 2.91 (0.02) (0.85) -- $ 17.03
1995 $ 12.46 0.10 2.52 (0.11) -- -- $ 14.97
1994 $ 13.12 0.10 (0.66) (0.10) -- -- $ 12.46
1993 $ 10.40 0.09 2.72 (0.09) -- -- $ 13.12
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
Turner Midcap Growth Fund
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1999** $ 13.87 (0.03) 7.35 -- -- -- $ 21.19
1998 $ 14.22 (0.07) 0.22 -- (0.50) -- $ 13.87
1997 (3) $ 10.00 (0.03) 4.36 -- (0.11) -- $ 14.22
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
Turner Small Cap Growth Fund
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1999** $ 21.49 (0.12) 7.04 -- -- -- $ 28.41
1998 $ 26.35 (0.23) (4.19) -- (0.25) (0.19) $ 21.49
1997 $ 23.13 (0.07) 3.80 -- (0.51) -- $ 26.35
1996 (2) $ 16.08 (0.08) 8.17 -- (1.04) -- $ 23.13
1995 $ 10.90 (0.06) 5.24 -- -- -- $ 16.08
1994 (4) $ 10.00 (0.02) 0.92 -- -- -- $ 10.90
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
Turner Micro Cap Growth Fund
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1999** (5) $ 9.88 (0.04) 4.58 -- -- -- $ 14.42
1998 (6) $ 10.00 (0.04) (0.08) -- -- -- $ 9.88
</TABLE>
* Annualized
** For the six-month period ended March 31.
+ Returns are for the period indicated and have not been annualized.
(1) The Turner Large Cap Growth Equity Fund commenced operations on February 1,
1997.
(2) On April 19, 1996, the Board of Trustees of the Adviser Inner Circle Funds
voted to approve a tax-free reorganization of the Turner Funds. In
connection with the reorganization, the Funds changed their fiscal year end
from October 31 to September 30, effective September 30, 1996.
(3) The Turner Midcap Growth Fund commenced operations on October 1, 1996.
(4) The Turner Small Cap Growth Fund commenced operations on February 7, 1994.
(5) On November 4, 1998, the Board of Trustees of the Alpha Select Funds voted
to approve a tax-free reorganization of the Turner Micro Cap Growth Fund
(the "Turner Funds") under which all assets and liabilities of the Turner
Funds were transferred to the TIP Funds.
(6) The Turner Micro Cap Growth Fund commenced operations on March 1, 1998.
Amounts designated as "--" are either $0 or have been rounded to $0.
40 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
<TABLE>
<CAPTION>
Ratio of Ratio of net
net expenses Ratio of Ratio of investment
to average net expenses expenses income (loss)
net assets to average Ratio of net to average to average
Net (including net assets investment net assets net assets
assets end directed (including income (loss) (excluding (excluding Portfolio
Total of period brokerage waivers and to average waivers and waivers and turnover
return+ (000) arrangements) reimbursements) net assets reimbursements) reimbursements) rate
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Turner Large Cap Growth Equity Fund (formerly Turner Ultra Large Cap Growth Fund)
- ------------------------------------------------------------------------------------------------------------------------------------
1999** 43.87% $ 8,837 1.00%* 1.00%* (0.39)%* 2.65%* (2.04)%* 169.52%
1998 17.26% $ 4,328 1.00% 1.00% (0.10)% 7.70% (7.80)% 234.93%
1997 (1) 22.80% $ 70 11.00%* 1.00%* (0.20)%* 26.45%* (25.25)% 346.47%
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Turner Growth Equity Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1999** 35.81% $138,001 0.96%* 0.99%* (0.44)%* 0.99%* (0.44)%* 154.37%
1998 10.71% $ 97,857 1.00% 1.04% (0.42)% 1.12% (0.50)% 249.58%
1997 32.61% $ 99,590 0.96% 1.02% (0.25)% 1.05% (0.28)% 178.21%
1996 (2) 20.61% $ 96,164 0.94%* 1.06%* 0.03%* 1.06%* 0.03%* 147.79%
1995 21.15% $115,819 0.94% 1.03% 0.69% 1.03% 0.69% 177.86%
1994 (4.28)% $112,959 0.95% 0.95% 0.86% 1.08% 0.73% 164.81%
1993 27.08% $ 53,327 1.00%* 1.00% 0.80% 1.52% 0.28% 88.35%
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Turner Midcap Growth Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1999** 52.78% $ 60,309 1.10%* 1.18%* (0.68)%* 1.19%* (0.69)%* 159.79%
1998 1.24% $ 24,582 1.23% 1.34% (0.79)% 1.73% (1.18)% 304.29%
1997 (3) 43.77% $ 5,145 1.25%* 1.25%* (0.62)%* 7.96%* (7.33)%* 348.29%
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Turner Small Cap Growth Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1999** 32.20% $195,953 1.25%* 1.28%* (1.03)%* 1.33%* (1.08)%* 106.71%
1998 16.90)% $147,534 1.25% 1.28% (0.99)% 1.41% (1.12)% 167.73%
1997 16.64% $153,462 1.24% 1.24% (0.84)% 1.33% (0.93)% 130.68%
1996 (2) 52.90% $ 67,425 1.25%* 1.25%* (0.88)%* 1.54%* (1.17)%* 149.00%
1995 47.52% $ 13,072 1.25% 1.25% (0.68)% 2.39% (1.82)% 183.49%
1994 (4) 12.35% $ 4,806 1.09%* 1.09%* (0.27)%* 4.32%* (3.50)%* 173.92%
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Turner Micro Cap Growth Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1999** 45.95% 6,085 1.25%* 1.25%* (0.71)%* 5.69%* (5.15)%* 124.69%
1998 (6) (1.20)% $ 2,843 1.25%* 1.25%* (0.64)%* 8.18%* (7.57)%* 128.53%
</TABLE>
TURNER FUNDS 1999 SEMIANNUAL REPORT | 41
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Financial highlights
For a share outstanding throughout each period
<TABLE>
<CAPTION>
Realized and
Net asset Net unrealized Distributions Distributions
value, investment gains from net from Net asset Net assets
beginning income (losses) on investment capital value end Total end of
of period (loss) investments income gains of period return+ period (000)
- ----------------------------------------------------------------------------------------------------------------------------------
Turner Short Duration Government Funds-Three Year Portfolio
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1999** (1) $ 10.25 0.28 (0.15) (0.28) (0.14) $ 9.96 1.33% $ 18,821
1998 (2) $ 10.10 0.35 0.15 (0.34) (0.01) $ 10.25 5.09% $ 12,015
1998 (3) $ 10.00 0.59 0.10 (0.59) -- $ 10.10 7.07% $ 15,544
1997 $ 10.04 0.58 (0.01) (0.59) (0.02) $ 10.00 5.45% $ 17,809
1996 $ 9.80 0.60 0.23 (0.59) -- $ 10.04 8.73% $ 11,027
1995 (4) $ 10.00 0.61 (0.22) (0.59) -- $ 9.80 4.08% $ 7,065
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Turner Short Duration Government Funds-One Year Portfolio--Institutional
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1999** $ 10.09 0.28 (0.01) (0.29) -- $ 10.07 2.74% $ 1,015
1998 (2) $ 10.08 0.35 -- (0.33) (0.01) $ 10.09 3.50% $ 991
1998 (3) $ 10.06 0.60 0.02 (0.60) -- $ 10.08 6.34% $ 1,195
1997 $ 10.03 0.60 0.03 (0.60) -- $ 10.06 6.32% $ 864
1996 $ 9.99 0.64 0.05 (0.65) -- $ 10.03 7.09% $ 398
1995 (4) $ 10.00 0.53 (0.02) (0.52) -- $ 9.99 5.21% $ 145
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Turner Short Duration Government Funds-One Year Portfolio--Adviser
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1999** (6) $ 10.11 0.24 0.01 (0.23) -- $ 10.13 2.55% $ 150
1998 (5) $ 10.08 0.30 0.03 (0.30) -- $ 10.11 3.26% --
</TABLE>
* Annualized
**For the six-month period ended March 31.
+ Returns are for the period indicated and have not been annualized.
(1)On November 4, 1998, the Board of Trustees of the Alpha Select Funds voted
to approve a tax-free reorganization of the Turner Short Duration Government
Fund-Three Year Portfolio (the "Fund") under which all the assets and
liabilities of the Fund were transferred to the TIP Funds.
(2)On November 10, 1997 the Board of Trustees of TIP Institutional Funds
(formerly, The Solon Funds) approved a change in the Turner Short Duration
Government Funds One Year and Three Year Portfolios' year end from February
28 to September 30, effective March 1, 1998.
(3)On January 22, 1998, shareholders of each Fund approved a change in the
advisor from Solon Asset Management, L.P. to Turner Investment Partners, Inc.
(4)The Turner Short Duration Government Funds Three Year and One Year
Portfolios- Institutional Shares class commenced operations on March 1, 1994.
(5)The Turner Short Duration Government Funds One Year Portfolios-Adviser
Shares class commenced operations on February 27, 1998.
(6)Average based upon amounts outstanding at each month end.
(7)There was no debt outstanding at the end of any period presented.
Amounts designated as "--" are either $0 or have been rounded to $0.
42 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
<TABLE>
<CAPTION>
Ratio of net
Ratio of investment
expenses income (loss)
Ratio of net to average to average Average Average
Ratio of investment net assets net assets debt debt
net expenses income (loss) (excluding (excluding per share outstanding
to average to average waivers and waivers and Interest during during
net assets net assets reimbursements) reimbursements) expense the period(6) the period (6)(7)
- ---------------------------------------------------------------------------------------------------------------------------
Turner Short Duration Government Funds-Three Year Portfolio
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1999** (1) 0.24%* 5.56%* 1.53%* 4.27%* -- -- --
1998 (2) 0.24%* 5.84%* 1.49%* 4.59%* -- -- --
1998 (3) 0.24% 5.85% 1.21% 4.88% -- -- --
1997 0.24% 5.80% 1.21% 4.83% 0.02% $0.04 $ 56,238
1996 0.24% 6.18% 1.45% 4.97% 0.12% $0.28 $256,115
1995 (4) 0.15% 6.21% 1.18% 5.18% 0.04% $0.08 $ 75,604
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
Turner Short Duration Government Funds-One Year Portfolio--Institutional
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1999** 0.00%* 5.64%* 1.04%* 4.60%* -- -- --
1998 (2) 0.00%* 5.88%* 10.83%* (4.95)%* -- -- --
1998 (3) 0.00% 5.97% 8.83% (2.86)% -- -- --
1997 0.00% 5.91% 10.25% (4.34)% -- -- --
1996 0.00% 6.46% 16.47% (10.01)% -- -- --
1995 (4) 0.00% 5.74% 27.89% (22.15)% -- -- --
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
Turner Short Duration Government Funds-One Year Portfolio--Adviser
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1999** (6) 0.25%* 5.56%* 1.29%* 4.52%* -- -- --
1998 (5) 0.25%* 5.63%* 11.08%* (5.20)%* -- -- --
</TABLE>
<TABLE>
<CAPTION>
Average
shares
outstanding Portfolio
during turnover
the period rate
- --------------------------------------------------------------------------------
Turner Short Duration Government Funds-Three Year Portfolio
- --------------------------------------------------------------------------------
<S> <C> <C>
1999** (1) -- 111.30%
1998 (2) -- 121.63%
1998 (3) -- 197.03%
1997 1,320,830 279.00%
1996 901,238 251.00%
1995 (4) 895,472 405.00%
<CAPTION>
- --------------------------------------------------------------------------------
Turner Short Duration Government Funds-One Year Portfolio--Institutional
- --------------------------------------------------------------------------------
<S> <C> <C>
1999** -- 180.27%
1998 (2) -- 96.56%
1998 (3) -- 68.80%
1997 -- 81.82%
1996 -- --
1995 (4) -- --
<CAPTION>
- --------------------------------------------------------------------------------
Turner Short Duration Government Funds-One Year Portfolio--Adviser
- --------------------------------------------------------------------------------
<S> <C> <C>
1999** (6) -- 180.27%
1998 (5) -- 96.56%
</TABLE>
TURNER FUNDS 1999 SEMIANNUAL REPORT | 43
<PAGE>
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Notes to financial statements
March 31, 1999
1. Organization:
TIP Funds, a Massachusetts business trust, and Alpha Select Funds, a Delaware
Business Trust, (each a "Trust" and collectively the "Trusts"), are registered
under the Investment Company Act of 1940, as amended, as a diversified open-end
management investment companies. The financial statements included herein are
those of the Turner Large Cap Growth Equity Fund (formerly Turner Ultra Large
Cap Growth) (the "Large Cap Growth Equity Fund"), the Turner Growth Equity Fund
(the "Growth Equity Fund"), the Turner Midcap Growth Fund (the "Midcap Growth
Fund"), the Turner Small Cap Growth Fund (the "Small Cap Growth Fund"), the
Turner Micro Cap Growth Fund (the "Micro Cap Growth Fund"), and the Turner Short
Duration Government Funds-Three Year Portfolio (the "Three Year Portfolio"),
which are funds offered by TIP Funds, and the Turner Short Duration Government
Funds-One Year Portfolio (the "One Year Portfolio"), which is a fund offered by
Alpha Select Funds (each a "fund" and collectively the "Funds"). The Turner
Short Duration Government Funds-Three Year and One Year Portfolios are
registered to offer two classes of shares, Institutional Class Shares and
Adviser Class Shares.
As of March 31, 1999, the Three Year Portfolio Adviser Class Shares had not
commenced operations. Additionally, the Turner Small Cap Growth Fund was closed
to new investors as of August 30, 1997. The assets of each fund are segregated,
and a shareholder's interest is limited to the fund in which shares are held.
The Funds' prospectus provides a description of each fund's investment
objectives, policies, and strategies.
2. Significant accounting policies:
The following is a summary of the significant accounting policies followed by
the Funds.
Security valuation--Investments in equity securities which are traded on a
national exchange (or reported on the NASDAQ national market system) are
stated at the last quoted sales price if readily available for such equity
securities on each business day; other equity securities traded in the
over-the-counter market and listed equity securities for which no sale was
reported on that date are stated at the last quoted bid price. Market value
for debt obligations is determined on the basis of last reported sales
price, or if no sales are reported, as is the case with most securities
traded over the counter, the mean between representative bid and asked
quotations. Short-term securities with maturities of 60 days or less may be
carried at amortized cost, which approximates market value. Fixed income
securities for which market quotations are not readily available may be
valued, pursuant to guidelines established by the Board of Trustees, with
reference to fixed income securities whose prices are more readily
obtainable and whose durations are comparable to the securities being
valued. Subject to the foregoing, other securities for which market
quotations are not readily available are valued at fair value as determined
in good faith by the Board of Trustees.
Federal income taxes--It is each Fund's intention to qualify as a regulated
investment company by complying with the appropriate provisions of the
Internal Revenue Code of 1986, as amended. Accordingly, no provision for
Federal income taxes is required.
Security transactions and related income--Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Dividend income is recognized on the ex-dividend date, and interest income
is recognized on the accrual basis. Costs used in determining realized
gains and losses on the sales of investment securities are those of the
specific securities sold during the respective holding period.
Securities purchased on a when-issued or delayed delivery basis may be
settled a month or more after the trade date. Such securities are included
in the portfolio and are subject to market fluctuations during this period.
On the date of the commitment to purchase or sell, the Funds designate
specific assets with a current value at least equal to the amount of the
commitment to be used for settling the commitment.
Net asset value per share--The net asset value per share of each Fund is
calculated on each business day, by dividing the total value of the fund's
assets, less liabilities, by the number of shares outstanding.
Repurchase agreements--Securities pledged as collateral for repurchase
agreements are held by the custodian bank until the respective agreements
mature. Provisions of the repurchase agreements ensure that the market
value of the collateral, including accrued interest thereon, is sufficient
in the event of default of the counterparty. If the counterparty defaults
and the value of the collateral declines or if the counterparty enters an
insolvency proceeding, realization of the collateral by the funds may be
delayed or limited.
44 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
Expenses--Expenses that are directly related to one of the funds are
charged to that fund. Other operating expenses of the Trust are prorated to
the Funds on the basis of relative daily net assets.
Distributions to shareholders--Distributions from net investment income are
declared and paid to Shareholders at least annually for the Large Cap
Growth Equity Fund, the Midcap Growth Fund, the Small Cap Growth Fund, and
the Micro Cap Growth Fund; quarterly for the Growth Equity Fund; and
declared daily and paid monthly for the Three Year and One Year Portfolios.
Any net realized capital gains on sales of securities for all Funds are
distributed to Shareholders at least annually.
Dividends from net investment income and distributions from net realized
capital gains are determined in accordance with U.S. Federal income tax
regulations, which may differ from those amounts determined under generally
accepted accounting principles. These book/tax differences are either
temporary or permanent in nature. To the extent these differences are
permanent, they are charged or credited to paid-in-capital or accumulated
net realized gain, as appropriate, in the period that the differences
arise.
Use of estimates--The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements, and the reported amounts of income and
expenses during the reported period. Actual results could differ from those
estimates.
Reclassifications--Certain prior year amounts have been reclassified to
conform with the current year presentation.
3. Organization costs and transactions with affiliates:
Organization costs have been capitalized by each Fund and are being amortized
over a period of sixty months. In the event any of the initial shares of a Fund
are redeemed by any holder thereof during the period that such Fund is
amortizing its organizational costs, the redemption proceeds payable to the
holder thereof by a Fund will be reduced by the unamortized organizational costs
in the same ratio as the number of shares outstanding at the time of redemption.
Certain officers of each Trust are also officers of SEI Investments Mutual Funds
Services (the "Administrator") and/or SEI Investments Distribution Co. (the
"Distributor"). Such officers are paid no fees by the Trusts for serving
as officers and trustees of the Trusts.
4. Administration, shareholder servicing, and distribution agreements:
Each Trust and the Administrator are parties to an agreement under which the
Administrator provides management and administrative services for an annual fee.
For these administrative services, the Administrator is entitled to a fee from
the Fund, which is calculated daily and paid monthly, at an annul rate of .09%
of the Trust's average daily net assets up to $250 million, .07% on the next
$250 million, .06% on the next $250 million, .05% on the next $1.25 billion and
.04% of such assets in excess on $2 billion. Each Fund is subject to a minimum
annual fee of $65,000 for the first class of shares and $15,000 for each
additional class of shares, which may be reduced at the sole discretion of the
Administrator.
The Growth Equity Fund, the Midcap Growth Fund, and the Small Cap Growth Fund
had directed certain portfolio trades to brokers who paid a portion of its
expenses. For the period ended March 31, 1999, the Funds expenses were reduced
by $19,257, $14,615 and $25,607 respectively, under this arrangement.
DST Systems, Inc., (the "Transfer Agent"), serves as the transfer agent and
dividend disbursing agent for the Funds under separate transfer agency
agreements with each Trust.
Prior to January 1, 1998, administrative services were provided to the Trust by
Solon Asset Management, L.P. for an annual fee of .07% of the average daily net
assets of the Three Year and One Year Funds.
TIP Funds and Alpha Select Funds are parties to a Distribution Agreement with
the Distributor dated April 28, 1996 and January 1, 1998 respectively. The
Distributor receives no fees for its distribution services under this agreement.
The Turner Short Duration Governments Funds-One Year Portfolio has adopted a
shareholder service plan for its Adviser Class Shares that allows the Fund to
pay service fees for services provided to shareholders. For Adviser Class
Shares, shareholder service fees, as a percentage of average daily net assets,
may be up to .25%.
5. Investment advisory agreement:
TIP Funds and Alpha Select Funds are parties to Investment Advisory Agreements
with Turner Investment Partners, Inc. (the "Adviser") dated April 28,
TURNER FUNDS 1999 SEMIANNUAL REPORT | 45
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
1996 and January 1, 1998 respectively, under which the Adviser receives an
annual fee equal to .75% of the average daily net assets of the Large Cap Growth
Equity, Growth Equity, and Midcap Growth Equity Funds, 1.00% of the Small Cap
Growth and Micro Cap Growth Funds, and .25% of the Three Year and One Year
Funds. The Adviser has voluntarily agreed to waive all or a portion of its fees
and to reimburse expenses in order to limit their total operating expenses (as a
percentage of daily net assets on an annualized basis) to not more than 1.00% of
the Large Cap Growth Equity and Growth Equity Funds, 1.25% of the Small Cap
Growth, Midcap Growth Equity and Micro Cap Growth Funds, and .36% and .61% of
the Three Year and One Year Funds, Institutional shares and Adviser shares,
respectively. Fee waivers and expense reimbursements are voluntary and may be
terminated at any time.
On January 1, 1998, Turner Investment Partners, Inc., acquired substantially all
of the assets and liabilities of Solon Asset Management, L.P. (the Trust's prior
investment adviser).
On January 22, 1998, shareholders of both the Three year and One Year Funds
approved a change in the adviser from Solon Asset Management, L.P. to Turner
Investment Partners, Inc.
6. Investment transactions:
The cost of security purchases and the proceeds from security sales, other than
short-term investments, for the period ended March 31, 1999, are as follows
(000):
<TABLE>
<CAPTION>
Turner Turner Turner Turner Turner Turner Short Duration
Large Cap Growth Midcap Small Cap Micro Cap Government Funds
Growth Equity Growth Growth Growth Three Year One Year
Equity Fund Fund Fund Fund Fund Portfolio Portfolio
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Purchases
Government -- -- -- -- -- 16,708 353
Other 12,865 185,290 71,154 184,455 7,180 684 --
Sales
Government -- -- -- -- -- 10,501 277
Other 10,683 181,305 56,007 184,697 5,350 2,047 136
</TABLE>
46 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
(Unaudited)
- --------------------------------------------------------------------------------
At March 31, 1999, the total cost of securities and net realized gains or losses
on securities sold for Federal income tax purposes was not materially different
from amounts reported for financial reporting purposes. The aggregate gross
unrealized appreciation and depreciation for securities held by the Funds at
March 31, 1999, are as follows (000):
<TABLE>
<CAPTION>
Turner Turner Turner Turner Turner Turner Short Duration
Large Cap Growth Midcap Small Cap Micro Cap Government Funds
Growth Equity Equity Growth Growth Growth Three Year One Year
Fund Fund Fund Fund Fund Portfolio Portfolio
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Aggregate gross
unrealized
appreciation 1,156 26,506 11,550 47,765 938 63 2
Aggregate gross
unrealized
depreciation (84) (1,048) (739) (6,787) (310) (72) (1)
- --------------------------------------------------------------------------------------------------------------------------
Net unrealized
appreciation
(depreciation) 1,072 25,458 10,811 40,978 628 (9) 1
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
7. Line of credit:
Pursuant to a credit agreement dated May 21, 1997, First Union National Bank
provides an uncommitted line of credit to the Turner Funds, Portfolios of the
TIP Funds, for short-term or emergency purposes, such as funding shareholder
redemptions. These loans are for the respective benefit of and repayable from
the respective assets of the Turner Funds. The aggregate principal amount of all
borrowings may not exceed 10% of the Turner Funds, net assets and the maximum
principal amount that the Bank will loan is $10,000,000. Borrowings under the
line of credit are charged interest based on the federal funds rate determined
at the date of borrowing and are secured by investment securities of the
borrowing portfolio. Each Turner Fund is individually, and not jointly, liable
for its particular advances under the line. There is no commitment fee on the
unused portion of the line of credit. There were no borrowings under the line of
credit during the period ended March 31, 1999.
8. Tax-free reorganizations
On November 4, 1998 the Board of Trustees of the Alpha Select Funds approved a
tax-free reorganization for the Turner Micro Cap Growth Fund and the Turner
Short Duration Government Fund-Three Year Portfolio (the "Portfolios") under
which all the assets and liabilities of the Portfolios would be transferred to
the TIP Funds, a Massachusetts business trust. A shareholder meeting was held on
January 25, 1999 and adjourned until January 29, 1999, at which time this
reorganization was approved by the Portfolios' shareholders.
Turner Micro Cap Growth Fund:
- ----------------------------------------------------------
(Voted January 29, 1999)
shares shares
voted outstanding
- ----------------------------------------------------------
For 185,646 99.86% 55.48%
Against 0 0.00 0.00
Abstain 266 0.14 0.08
Turner Short Duration Government Funds-
- ----------------------------------------------------------
Three Year Portfolio:
- ----------------------------------------------------------
(Voted January 29, 1999)
shares shares
voted outstanding
- ----------------------------------------------------------
For 949,833 100.00% 86.46%
Against 0 0.00 0.00
Abstain 0 0.00 0.00
9. Subsequent event
On March 29, 1999 the Board of Trustees of the Alpha Select Funds approved a
tax-free reorganization for the Turner Short Duration Government Funds-One Year
Portfolio (the "Portfolio") under which all of the assets and liabilities of the
Portfolio would be transferred to the TIP Funds, a Massachusetts business trust.
A shareholder meeting to approve this reorganization was scheduled for May 24,
1999.
TURNER FUNDS 1999 SEMIANNUAL REPORT | 47
<PAGE>
- -------------------------------------------------------------------------------
Turner Funds, Portfolios of the TIP Funds
and Alpha Select Funds
TIP Funds trustees
(Responsible for managing the business and affairs of the TIP Funds, which
include the following portfolios: the Turner Large Cap Growth Equity Fund, the
Turner Growth Equity Fund, the Turner Midcap Growth Fund, the Turner Small Cap
Growth Fund, the Turner Micro Cap Growth Fund, and the Turner Short Duration
Government Funds-Three Year Portfolio)
Richard A. Hocker
Chief Investment Officer and Senior Vice President
Penn Capital Management Co., Inc.
Michael E. Jones
Senior Vice President, Investment Adviser, and Portfolio Manager
Clover Capital Management, Inc.
Alfred C. Salvato
Treasurer
Thomas Jefferson University Health Care Pension Fund
Janet F. Sansone
Corporate Vice President, Human Resources
Frontier Corporation
Robert E. Turner
Chairman and Chief Investment Officer
Turner Investment Partners, Inc.
Dr. John T. Wholihan
Professor and Dean, College of Business
Loyola Marymount University
Alpha Select Funds trustees
(Responsible for managing the business and affairs of the Alpha Select Funds,
which include the following portfolios: the Turner Short Duration Government
Funds-One Year Portfolio)
Ronald Filante
Associate Professor of Finance
Pace University
Katherine Griswold
Director of Benefits Trusts
Southern New England Telephone Company
Alfred C. Salvato
Treasurer
Thomas Jefferson University Health Care Pension Fund
Robert E. Turner
Chairman and Chief Investment Officer
Turner Investment Partners, Inc.
Investment adviser
Turner Investment Partners, Inc.
Berwyn, Pennsylvania
Distributor
SEI Investments Distribution Co.
Oaks, Pennsylvania
Administrator
SEI Investments Mutual Fund Services
Oaks, Pennsylvania
Legal counsel
Morgan, Lewis & Bockius LLP
Philadelphia
Independent auditors
Ernst & Young LLP
Philadelphia
This report was prepared for shareholders of the Turner Funds, Portfolios of
both TIP Funds and Alpha Select Funds. It may be distributed to others only if
preceded or accompanied by a Turner Funds' Prospectus, which contains detailed
information. All Turner Funds are offered by prospectus only.
48 | TURNER FUNDS 1999 SEMIANNUAL REPORT
<PAGE>
[PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
[LOGO]
- ---------------------
Turner Funds
1235 Westlakes Drive
Berwyn, Pennsylvania 19312
Telephone: 1-800-224-6312
Fax: (610) 251-0731
Email: [email protected]
Web Site: www.turner-invest.com
