ICON FUNDS
SEMI-ANNUAL REPORT
Ahead of the Curve
1999
[Graphic Omitted]
<PAGE>
ICON FUNDS
Management Discussion and Analysis .................................... 8
Domestic Funds
Management Discussion and Analysis .................................... 35
Short-term Fixed Income Fund
Management Discussion and Analysis .................................... 37
International Funds
Financial Statements .................................................. 52
Financial Highlights .................................................. 60
Notes to Financial Statements ......................................... 64
Serving as Advisor for the ICON Funds
is Meridian Investment Management
Corporation, referenced in this report as
the "Advisor."
<PAGE>
Dear ICON Funds Shareholders:
A new market has emerged.
That observation-central to my letter in the Annual Report issued last fall-is
proving true. At that time, I correctly stated that the market was forming a
bottom, and that conditions in the stock market suggested a buying opportunity.
Six months later, we can see that our quantitative system was accurate in
recognizing value amidst the classic bottom characteristics of fear and
uncertainty. We believe it kept us ahead of the curve.
I also remarked, at the close of last fiscal year, that the four-year bull
market (December 1994 - July 1998) had ended. A new one, with new leadership,
was emerging. Such is the case. The final fourteen months of the `94-'98 run
proved difficult for money mangers. The leadership was notably narrow and
concentrated in just a few, expensive stocks. Large-cap, growth stocks generally
led the way, leaving most other stocks to languish. This occurred despite
underlying value characteristics that suggested prices should have climbed.
This fresh market is different from the prior one in several ways. The
leadership is quite broad and includes many small and mid-sized companies.
Industries that lagged in late 1997 and early 1998 have emerged. Our system
correctly identified these new leaders last fall and acted accordingly.
2
<PAGE>
Outstanding industries such as Semiconductors in the Technology Fund, Hotels and
Gaming in the Leisure Fund, and Drilling and Equipment in the Energy Fund are
now well represented in the ICON Funds.
Recognizing a market bottom in a time of fear and uncertainty is a primary
strength of our system. Identifying new leadership in the subsequent advance is
another strength. The last six months demonstrates those intentionally designed
characteristics. It should be pointed out, as well, that the valuation approach
used in ICON management is distinct from and more universal than the simple
Price-to-Book Value or Price-to-Earnings (P/E) criteria that have not worked
well these last few years. Our valuation equation is applied to individual
stocks. It also includes an expected growth rate in future earnings and computes
an intrinsic value. Last fall, there were many bargains with prices below their
intrinsic values. We elected to purchase these, while conventional "value"
managers found them high based on P/E ratios.
The dual dynamics of value and leadership suggest to us that this new bull
market will last two to three years. With the Dow Jones Industrial Average
reaching 11,000 and P/E ratios at an historical high, many investors are
doubting the market can go higher. Our indicators signal otherwise. We believe
the broad U.S. market is still priced about 17 percent below fair value. Low
interest rates and decent growth expectations combine to make fair value an
upwardly moving target for stock prices.
[Photo Omitted]
Craig T. Callahan, D.B.A. Trustee,
Chief Investment Officer of the Advisor
3
<PAGE>
My report on the administration of the ICON Funds would be incomplete without
comment on action being considered by the Securities and Exchange Commission
(SEC). Arthur Levitt, chairman of the SEC, has been actively proposing
modifications to the Investment Company Act of 1940 ("The 40 Act") which
regulates mutual funds. As I describe these potential changes, I am pleased to
note that the ICON Funds are well ahead of his recommendations.
In brief, Mutual Funds are corporations or trusts with boards of directors or
boards of trustees. The 40 Act requires that 40 percent of these trustees be
independent, meaning they have no financial involvement with the advisor
(manager) of the funds. Mr. Levitt has proposed that a majority of the trustees
be independent. The trustees, he points out, are there to represent the
shareholders, and at times, their position may run counter to the advisor's
position. Mr. Levitt's preference for a majority is intended to ensure the
protection of shareholders when conflicts arise.
At the ICON Funds, the board of trustees is comprised of four individuals, three
(75 percent) of whom are independent. I, as Chairman, obviously have a financial
interest in Meridian Investment Management, the Advisor to the funds. The three
remaining trustees are James Hire, a consultant to the hospitality industry;
Michael Sentel, an attorney formerly with the SEC and currently with the
The board of trustees is comprised of four individuals,
[Graphic Omitted]
three (75 percent) of whom are independent.
4
<PAGE>
Department of Education; and Glen Bergert, a CPA who retired as a partner with a
"Big Five" accounting firm to launch his own venture capital company. This group
is truly independent and positioned to represent you, the shareholders.
A related recommendation from Mr. Levitt concerns separate legal counsel for the
advisor and the trustees. Your ICON Funds have functioned in that manner since
inception. The trustees retain Charles Lutter as legal counsel. Mr. Lutter, an
SEC staff member for many years, now heads a private practice focusing on mutual
funds. Meridian has in-house legal counsel, also formerly with the SEC, and
retains various law firms for specialty needs. With Mr. Lutter at every
quarterly trustee meeting and available at all other times, the trustees benefit
from legal counsel independent of the Advisor.
These proposals have been conveyed at a few industry conferences; and, of
course, I'm not in a position to know what feedback was received. While there
may be some opposition from some mutual fund companies, I expect the proposals
will become effective. If they do, they will not affect the ICON Funds. Again,
we are already there...ahead of the curve.
Another administrative aspect is worth noting. When the ICON Funds were opened,
they were only available through advisors. This was a conservative strategy to
get them established. In December 1998, that restriction was removed; the funds
are now open to the investing public. Shares can be purchased directly from the
transfer agent, Firstar of Milwaukee, or on popular custodial/no-transaction-fee
platforms such as Charles Schwab or National Investor Services Corp. I am
pleased to report that the Funds are being received quite well as more and more
investors learn of them.
5
<PAGE>
In summary, our valuation suggests that we are now six months into what we're
projecting to be a 36-month transit. This is a significantly different market
than that of the last four years.
Thank you for selecting ICON Funds for your sector investing needs. We look
forward to promising possibilities as this new market builds.
Sincerely,
/s/ Craig T. Callahan
- ------------------------------------------------
Craig T. Callahan, D.B.A.
Trustee, Chief Investment Officer of the Advisor
6
<PAGE>
ICON FUNDS
Management Discussion and Analysis .................................... 8
Domestic Funds
Management Discussion and Analysis .................................... 35
Short-term Fixed Income Fund
Management Discussion and Analysis .................................... 37
International Funds
Financial Statements .................................................. 52
Financial Highlights .................................................. 60
Notes to Financial Statements ......................................... 64
Serving as Advisor for the ICON Funds
is Meridian Investment Management
Corporation, referenced in this report as
the "Advisor."
7
<PAGE>
Management Discussion & Analysis
Basic Materials
Performance
The ICON Basic Materials Fund (the "Fund") opened on May 5, 1997. The Fund
under-performed its benchmark, the S&P Basic Materials Index, by approximately
7% over the period 10/1/98 to 3/31/99. The Fund's total return for this six
month period was (3.63%). The S&P Basic Materials Index return was 3.34% for the
same time period. The S&P Basic Materials Index has a 20% weighting in Du Pont
(total return of 4.5%) and a 6% weighting in Dow Chemical (total return of 11%),
which provided a boost to the Index return. In general, basic materials and
commodities industries continued to fare poorly during the period.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
The Basic Materials sector has been plagued by weak prices for commodities. In
large part, this has been caused by weak and weakening economies around the
world. The difficult operating environment shows few signs of improving any time
soon, although stock prices already reflect the gloomy conditions.
Industry Highlights
In the last six months, the Advisor sold the Fund's holdings in the Construction
industry. Based on the Advisor's quantitative system that incorporates valuation
and price momentum, the industry fell below the sell threshold. The Construction
industry was replaced by the Electrical Equipment industry.
The largest industry holding is the Aluminum/Gold/Precious Metals Mining
industry, which includes companies such as Phelps Dodge, Freeport-McMoran,
Asarco, Cyprus Amax and INCO. This industry comprises approximately 63% of the
Fund. Weak commodity prices hurt these companies in 1998; but in the first
quarter of 1999, the industry has shown some signs of life, especially Cyprus
Amax and INCO.
The second largest industry holding is Electrical Equipment. This industry
comprises approximately 34% of the Fund and includes companies such as General
Electric, Honeywell, Solectron, Rockwell and Molex. General Electric has
benefited from investors' infatuation with large companies that provide
consistent earnings growth. The other companies offer better values. One of the
holdings, AMP, was recently purchased by Tyco - an indication that other
companies see value here as well.
Current Outlook
The Advisor expects the Basic Materials sector to provide defensive
characteristics in the current market. Stock prices in the sector reflect a
negative outlook for commodity prices; the situation is unlikely to worsen
further. Moreover, any improvement in foreign economies could provide a welcome
boost to the bottom line. Based on valuation and momentum characteristics of the
industries in the Fund, we are optimistic that the Basic Materials sector
provides good investment opportunities.
8
<PAGE>
Basic Materials
- ---------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 97.5%
Top 10 Equity Holdings (% of Assets) 58.4%
Number of Stocks 22
Cash & Cash Equivalents 2.5%
Top 10 Equity Holdings March 31, 1999 (unaudited)
INCO Ltd. 7.2%
Cyprus Amax Mineral Co. 7.0%
Stillwater Mining Co. 6.6%
Freeport McMoran Copper Class B 6.4%
Phelps Dodge 6.2%
Solectron 5.4%
Honeywell 5.0%
AMP Inc. 4.9%
General Electric 4.9%
Molex 4.8%
Top Industries March 31, 1999 (unaudited)
Aluminum/Gold/Precious Metals Mining 63.8%
Electrical Equipment 34.2%
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The S&P Basic Materials Index is a capitalization-weighted index that measures
the performance of the basic materials sector of the S&P SuperComposite Index.
It is comprised of 125 stocks. The Basic Materials Index is an unmanaged index
that includes the reinvestment of dividends and does not reflect deductions for
commission, management fees and all expenses. Individuals cannot invest in the
index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
9
<PAGE>
Schedule of Investments
March 31, 1999
(unaudited)
Shares or Principal Amount Market Value
Common Stocks 98.0%
Aluminum/Gold/Precious Metals Mining 63.8%
4,100 Alcan Aluminum LTD $ 105,831
2,500 Alcoa Inc. 102,969
31,400 Asarco Inc. 431,750
23,650 Barrick Gold Corp. 403,528
92,400 Battle Mountain Gold 254,100
54,000 Cyprus Amax Mineral Company 654,750
54,900 Freeport-McMoran Copper Class B 597,037
112,700 Hecla Mining Co.a 309,925
42,100 Homestake Mining Co. 363,112
50,700 INCO Ltd. 674,944
23,335 Newmont Mining Corp. 408,362
11,700 Phelps Dodge 576,225
31,900 Placer Dome Inc. 356,881
2,200 Reynolds Metals 106,287
23,550 Stillwater Mining Co.a 621,131
---------------------------------------------------------------
Total Aluminum/Gold/Precious Metals Mining 5,966,832
Electrical Equipment 34.2%
8,600 AMP Inc. 461,713
8,000 Emerson Electric 423,500
4,100 General Electric 453,563
6,200 Honeywell 470,038
15,200 Molex 446,500
10,100 Rockwell 428,619
10,400 Solectron 505,050
---------------------------------------------------------------
Total Electrical Equipment 3,188,983
Shares or Principal Amount Market Value
Common Stocks - continued
Total Common Stocks
(Cost $11,717,262) 9,155,815
- -----------------------------------------------------------------------
Short-Term Commercial Notes 2.5%
- -----------------------------------------------------------------------
$237,928 American Family Demand Note
4.54% 7/26/99 237,928
- -----------------------------------------------------------------------
Total Short-Term Commercial Notes
(Cost $237,928) 237,928
- -----------------------------------------------------------------------
Total Investments 100.5%
(Cost $11,955,190) 9,393,743
- -----------------------------------------------------------------------
Other Liabilities less Assets (0.5%) (48,299)
- -----------------------------------------------------------------------
Net Assets 100.0% $ 9,345,444
The accompanying notes are an integral part of the financial statements.
a non-income producing security
10
<PAGE>
Consumer Cyclicals
- --------------------------------------------------------------------------------
Performance
The ICON Consumer Cyclicals Fund (the "Fund") opened on July 9, 1997. While past
performance does not guarantee future results, the Fund outperformed its
benchmark, the S&P SuperComposite 1500 Index, by approximately 1.3% over the
period 10/1/98 to 3/31/99. The Fund's total return for this six month period was
27.47%. The S&P SuperComposite 1500 Index return was 26.14% for the same time
period. The Fund's performance was boosted by its holdings in the Retail
Specialty (Apparel) and Services (Advertising/Marketing) industries.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
The Consumer Cyclicals sector has benefited from the strong U.S. economy, which
has been powered by the American consumer. Tame inflation, low unemployment and
a healthy stock market have provided a happy setting for consumer spending. The
Advisor expects this environment to continue for the foreseeable future.
Industry Highlights
In the last six months, the Advisor added two industries to the Fund's holdings:
Machinery (Diversified) and Manufacturing (Specialized). Based on the Advisor's
quantitative system that incorporates valuation and price momentum, both
industries showed up as attractive investments around the turn of the year.
Stock prices in both industries suffered last fall, but have since recovered
strongly.
The largest industry holding is Services (Advertising/Marketing). This industry
comprises approximately 20% of the Fund and includes companies such as Omnicom,
Interpublic, Acxiom, and Catalina Marketing. In their efforts to reach
consumers, businesses continue to devote resources to advertising and marketing
budgets. Even though some of these advertising companies have expanded
internationally in recent years, the strong U.S. economy has more than made up
for any weakness from foreign operations.
Another large industry holding is the Retail Specialty (Apparel) industry, which
includes companies such as Gap, TJX Companies, Limited, Men's Wearhouse and
Talbots. The industry comprises approximately 13% of the Fund. The healthy
domestic economy has spurred consumers to spend freely on clothing and apparel.
Same store sales for many companies in the industry are increasing much faster
than analysts had anticipated.
Current Outlook
Many industries within the Consumer Cyclicals sector continue to look attractive
to our style of investment management. This sector generally has small and
middle capitalization stocks. Even so, the Fund managed to outperform the
market-cap weighted S&P SuperComposite 1500 over the last six months. Based on
valuation and momentum characteristics of the industries in the Fund, we are
optimistic that the opportunities remain.
11
<PAGE>
Consumer Cyclicals
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 98.7%
Top 10 Equity Holdings (% of Assets) 38.7%
Number of Stocks 44
Cash & Cash Equivalents 1.3%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Catalina Marketing Corp. 5.0%
Lowes Companies 5.0%
Home Depot 4.5%
Omnicom Group 4.1%
Staples Inc. 4.1%
Interpublic GRP Co. Inc. 3.6%
Gap Inc. 3.3%
Acxiom Corp. 3.1%
Office Depot 3.0%
Sherwin Williams 3.0%
- --------------------------------------------------------------------------------
Top Industries March 31, 1999 (unaudited)
Services (Advertising/Marketing) 20.6%
Retail (Building Supplies) 17.4%
Retail (Specialty) 12.7%
Retail Specialty (Apparel) 12.6%
Specialty Printing 10.9%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The S&P SuperComposite 1500 Index is a broad-based capitalization-weighted index
of 1500 U.S. companies and is comprised of the S&P 400, S&P 500 and the S&P 600.
It is comprised of 1500 stocks. The S&P SuperComposite 1500 Index is an
unmanaged index that includes the reinvestment of dividends and does not reflect
deductions for commission, management fees and all expenses. Individuals cannot
invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
12
<PAGE>
Consumer Cyclicals
Schedule of Investments
March 31, 1999
(unaudited)
Shares or Principal Amount Market Value
Common Stocks 98.4%
Specialty Printing 10.9%
35,000 Banta Corp. $ 665,000
49,600 Bowne & Co. 579,700
18,000 Consolidated Graphicsa 1,039,500
29,000 Deluxe Corp. 844,625
23,100 Donnelley RR & Sons 743,531
27,300 Valassis Communications 1,412,775
30,400 World Color Press 646,000
Total Specialty Printing 5,931,131
Retail (Home Shopping) 4.3%
5,500 CDW Computer Centers Inc.a 379,500
22,500 Global Directmail Corp.a 376,875
16,200 Lands End Inc. 560,925
63,100 Micro Warehouse Inc.a 1,017,488
Total Retail (Home Shopping) 2,334,788
Retail (Specialty) 12.7%
45,700 Autozone Inc.a 1,388,137
44,800 Office Depota 1,649,200
82,400 OfficeMax Inc.a 710,700
68,250 Staples Inc.a 2,243,719
47,700 Toys R Us Inc.a 897,356
Total Retail (Specialty) 6,889,112
Retail Specialty (Apparel) 12.6%
26,550 Gap Inc. 1,787,147
35,600 Limited Inc. 1,410,650
35,000 Mens Wearhouse Inc.a 1,010,625
46,200 TJX Cos Inc. 1,570,800
44,000 Talbots Inc. 1,072,500
Total Retail Specialty (Apparel) 6,851,722
Services (Advertising/Marketing) 20.6%
63,000 Acxiom Corp.a 1,669,500
57,000 ADVO Inc. 1,100,813
32,000 Catalina Marketing Corp.a 2,748,000
25,000 Interpublic GRP Co. Inc. 1,946,875
28,100 Omnicom Group 2,246,244
55,000 True North Communications 1,546,875
Total Services (Advertising/Marketing) 11,258,307
Manufacturing (Specialized) 10.5%
20,200 Avery Dennison 1,161,500
29,500 Diebold 708,000
33,500 Pall Corp. 554,844
25,100 Parker Hannifin 859,675
23,000 Sealed Air Corp. 1,131,312
42,200 US Filter 1,292,375
Total Manufacturing (Specialized) 5,707,706
Shares or Principal Amount Market Value
Common Stocks - continued
Retail (Building Supplies) 17.4%
40,000 Fastenal $ 1,402,500
39,700 Home Depot 2,471,325
56,000 Hughes Supply Inc. 1,274,000
45,000 Lowes Companies 2,722,500
58,000 Sherwin Williams 1,631,250
Total Retail (Building Supplies) 9,501,575
Machinery (Diversified) 9.4%
31,100 Case Equipment 789,162
19,000 Caterpillar 872,813
17,400 Cooper Industries 741,675
23,100 Deere & Co. 892,237
26,600 Dover Co. 874,475
18,700 Ingersoll Rand Co. 927,988
Total Machinery (Diversified) 5,098,350
Total Common Stocks
(Cost $52,071,508) 53,572,691
Short-Term Commercial Notes 1.3%
$499,398 General Mills Demand Note
4.54% 11/9/99 499,398
$208,854 Pitney Bowes Demand Note
4.54% 8/3/99 208,854
Total Short-Term Commercial Notes
(Cost $708,252) 708,252
Total Investments 98.7%
(Cost $52,779,760) 54,280,943
Assets less other Liabilities 0.3% 164,849
Net Assets 100.0% $ 54,445,792
The accompanying notes are an integral part of the financial statements.
a non-income producing security
13
<PAGE>
Energy
Performance
The ICON Energy Fund (the "Fund") opened on November 5, 1997. The Fund
under-performed its benchmark, the S&P Energy Index, over the period 10/1/98 to
3/31/99. The Fund's total return for this six month period was 5.91%. The S&P
Energy Index return was 6.48% for the same time period. The S&P Energy Index is
heavily weighted in the International Integrated Oil stocks such as Exxon and
Chevron, which proved more defensive than other oil-related stocks during the
fall of 1998. In contrast, during the first quarter of 1999, Drilling and
Equipment stocks have increased much more dramatically than the larger
capitalized International Integrated stocks.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
The Energy sector has been plagued by weak prices and excess supply. Per gallon
prices of oil have dropped steadily from the mid $20s in 1997 to nearly $10 by
the end of 1998. Prices have recovered to the $15 range as producer countries
have implemented supply cuts.
Industry Highlights
In the last six months, the Advisor tilted the Fund's holdings toward a heavier
weighting in the Drilling and Equipment industry. Based on the Advisor's
quantitative system that incorporates valuation and price momentum, the Drilling
and Equipment industry is a more attractive investment than other industries in
the sector.
The largest industry holding is Drilling and Equipment. The industry comprises
approximately 60% of the Fund and includes companies such as Schlumberger,
Baker-Hughes, BJ Services, Halliburton and Transocean Offshore. Weak oil prices
and fears of worldwide recession caused stock prices to lag through 1998. The
industry offered compelling valuations by the end of the year and healthy price
momentum after the strong first quarter price performance.
The other industry holding is the Exploration and Production industry, which
includes companies such as Anadarko, Apache, Kerr-McGee, Union Pacific Resources
and Noble Affiliates. The industry comprises approximately 31% of the Fund. Weak
oil prices also hurt these companies in 1998; but in the first quarter of 1999,
the industry has shown some signs of life, especially in Union Pacific Resources
and Anadarko stocks.
Current Outlook
The Advisor expects the Energy sector to provide solid performance in the
current market. Stock prices in the sector are rebounding as the outlook for oil
prices improves. Production cuts are alleviating the supply/ demand imbalance.
Moreover, any improvement in foreign economies could provide a welcome boost to
the bottom line. Based on valuation and momentum characteristics of the
industries in the Fund, we are optimistic that the Energy sector provides good
investment opportunities.
14
<PAGE>
Energy
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 87.8%
Top 10 Equity Holdings (% of Net Assets) 50.2%
Number of Stocks 21
Cash & Cash Equivalents 12.2%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Kerr-McGee Co. 5.9%
Schlumberger Ltd. 5.7%
Baker-Hughes, Inc. 5.7%
Halliburton Co. 5.4%
Nabors Industries 5.2%
B J Services 4.9%
Ensco International, Inc. 4.4%
Tidewater, Inc. 4.4%
Transocean Offshore, Inc. 4.4%
Noble Drilling Corp. 4.2%
- --------------------------------------------------------------------------------
Top Industries March 31, 1999 (unaudited)
Oil & Gas (Drilling & Equip.) 60.9%
Oil & Gas (Exploration/Prod.) 31.1%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The S&P Energy Index is a capitalization-weighted index of all stocks designed
to measure the performance of the energy sector of the S&P 500 Index. It is
comprised of 23 stocks. The S&P Energy Index is an unmanaged index that includes
the reinvestment of dividends and does not reflect deductions for commission,
management fees and all expenses. Individuals cannot invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
15
<PAGE>
Energy
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares or Principal Amount Market Value
Common Stocks 92.0%
Oil & Gas (Drilling & Equip.) 60.9%
24,200 Baker-Hughes, Inc. $ 588,362
21,700 B J Servicesa 508,594
34,400 Ensco International, Inc. 457,950
35,200 Global Marine, Inc.a 413,600
14,600 Halliburton Co. 562,100
18,900 Helmerich & Payne 428,794
29,500 Nabors Industriesa 536,531
25,300 Noble Drilling Corp.a 438,006
9,804 Schlumberger Ltd. 590,078
10,900 Smith International, Inc. 436,000
17,700 Tidewater, Inc. 457,988
13,500 Transocean Offshore, Inc. 455,238
16,765 Weatherford Internationala 437,985
---------------------------------------------------------------
Total Oil & Gas (Drilling & Equip.) 6,311,226
Oil & Gas (Exploration/Prod.) 31.1%
11,000 Anadarko Petroleum Corp. 415,250
15,700 Apache Corp. 409,181
9,400 Burlington Resources 375,413
11,300 Devon Energy Corporation 311,456
18,594 Kerr-McGee Co. 610,116
8,100 Murphy Oil Corp. 336,150
13,200 Noble Affiliates 382,800
32,700 Union Pacific Resources Group 388,313
---------------------------------------------------------------
Total Oil & Gas (Exploration/Prod.) 3,228,679
Shares or Principal Amount Market Value
Common Stocks - continued
Total Common Stocks
(Cost $14,054,711) 9,539,905
- --------------------------------------------------------------------------------
Short-Term Commercial Notes 12.8%
$384,504 General Mills Demand Note
4.54% 11/9/99 384,504
- --------------------------------------------------------------------------------
$371,623 Pitney Bowes Demand Note
4.54% 8/3/99 371,623
- --------------------------------------------------------------------------------
$203,826 Warner Lambert Demand Note
4.57% 7/26/99 203,826
$368,000 American Family Demand Note
4.56% 7/26/99 368,000
- --------------------------------------------------------------------------------
Total Short-Term Commercial Notes
(Cost $1,327,953) 1,327,953
- --------------------------------------------------------------------------------
Total Investments 104.8%
(Cost $15,382,664) 10,867,858
Other Liabilities less Assets (4.8%) (501,884)
- --------------------------------------------------------------------------------
Net Assets 100.0 $ 10,365,974
The accompanying notes are an integral part of the financial statements.
a non-income producing security
16
<PAGE>
Financial Services
Performance
The ICON Financial Services Fund (the "Fund") opened on July 1, 1997. While past
performance does not guarantee future results, the Fund outperformed its
benchmark, the Lipper Financial Services Funds Index, by more than 5% over the
period 10/1/98 to 3/31/99. The Fund's total return for this six month period was
26.21%. The Lipper Financial Services Funds Index return was 20.66% for the same
time period. Many of the Fund's industry holdings performed well during the
period. Performance was helped in particular by investments in the Banks (Money
Center) and Consumer Finance industries.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
The Financial Services sector has benefited from the low inflation environment,
which protects the value of the asset side of the balance sheet. Also the
consolidation trend has continued, as industry leaders seek to provide more
financial products under one roof.
Industry Highlights
In the last six months, the Advisor sold the Insurance (Multi-Line) industry and
increased the Fund's weightings in the Consumer Finance and Banks & Bank Holding
Companies industries. The Fund's largest weightings are in the Consumer Finance
and Banks & Bank Holding Companies industries, which comprise just over half of
the Fund. Other holdings are in the Insurance (Property/Casualty) and Financial
(Diversified) industries.
The largest industry holding is Consumer Finance. The industry comprises
approximately 34% of the Fund and includes companies such as Household
International, MBNA, Countrywide Credit and Providian Financial. These companies
have benefited from heavy consumer use of credit cards and the strong mortgage
market.
The second largest industry holding is Banks & Bank Holding Companies. This
industry includes companies such as BankAmerica, Chase Manhattan, First Union,
J.P. Morgan and Bankers Trust. This industry comprises approximately 23% of the
Fund. The strong domestic economy has resulted in healthy demand for the broad
range of financial services that these companies supply. Even so, the events of
last fall caused a sell-off in these stocks. As the Russian debt crisis and the
Asian devaluations have faded into history, fears of a global financial meltdown
have also faded. Share prices have rebounded accordingly.
Current Outlook
The Advisor is cautiously optimistic regarding the Financial Services sector.
Only a few industries continue to look attractive to our style of investment
management. Based on valuation and momentum characteristics of the industries in
the Fund, we are optimistic that opportunities remain for these select
industries.
17
<PAGE>
Financial Services
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 98.1%
Top 10 Equity Holdings (% of Net Assets) 54.5%
Number of Stocks 26
Cash & Cash Equivalents 1.9%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Capital One Financial Corp. 6.6%
Household International Inc. 6.1%
Providian Financial Corp. 6.1%
Cash America Intl. 5.5%
Morgan (J.P.) & Co. 5.4%
BankAmerica Corp. 5.1%
MBNA Corp. 5.1%
Chase Manhattan Corp. 4.9%
Countrywide Credit 4.9%
First Union 4.8%
- --------------------------------------------------------------------------------
Top Industries March 31, 1999 (unaudited)
Consumer Finance 34.3%
Banks & Bank Holding Companies 22.9%
Insurance (Property/Casualty) 20.8%
Financial (Diversified) 20.5%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The Lipper Financial Services Funds Index is a total return performance index
consisting of the largest mutual funds within its respective investment
objective category. It is comprised of 10 funds. The Lipper Financial Services
Funds Index is an unmanaged index that includes the reinvestment of dividends
and does not reflect deductions for commission, management fees and all
expenses. Individuals cannot invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
18
<PAGE>
Financial Services
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares or Principal Amount Market Value
Common Stocks 98.5%
Financial (Diversified) 20.5%
2,200 American Express Company $ 258,500
3,200 American General Corp. 225,600
4,150 Citigroup 265,081
3,600 Freddie Mac 205,650
3,000 Fannie Mae 207,750
2,400 Morgan Stanley & Dean Witter Co. 239,850
----------------------------------------------------
Total Financial (Diversified) 1,402,431
Banks & Bank Holding Companies 22.9%
4,929 BankAmerica Corp. 348,111
2,200 Bankers Trust Corp. 194,150
4,100 Chase Manhattan Corp. 333,381
6,100 First Union 325,969
3,000 Morgan (J.P.) & Co. 370,125
----------------------------------------------------
Total Banks & Bank Holding Companies 1,571,736
Consumer Finance 34.3%
3,000 Capital One Financial Corp. 453,000
29,200 Cash America Intl. 375,950
9,000 Countrywide Credit 337,500
9,100 Household International Inc. 415,188
14,750 MBNA Corp. 352,156
3,800 Providian Financial Corp. 418,000
-----------------------------------------------------
Total Consumer Finance 2,351,794
Shares or Principal Amount Market Value
Common Stocks - continued
Insurance (Property/Casualty) 20.8%
4,300 Allstate Corp. $ 159,369
4,300 American Financial Grp., Inc. 151,306
4 Berkshire Hathaway A 285,600
16 Berkshire Hathaway B 37,616
2,600 Chubb Corp. 152,262
4,700 Cincinnati Financial Corp. 171,256
1,000 Progressive Corp. 143,500
4,000 Safeco Corp. 161,750
5,160 St Paul Cos. 160,283
----------------------------------------------------
Total Insurance (Property/Casualty) 1,422,942
Total Common Stocks
(Cost $6,480,274) 6,748,903
----------------------------------------------------
Short-Term Commercial Notes 1.9%
$31,577 General Mills Demand Note
4.54% 11/9/99 31,577
----------------------------------------------------
$95,743 Warner Lambert Demand Note
4.57% 7/26/99 95,743
----------------------------------------------------
Total Short-Term Commercial Notes
(Cost $127,320) 127,320
----------------------------------------------------
Total Investments 100.4%
(Cost $6,607,594) 6,876,223
----------------------------------------------------
Other Liabilities less Assets (0.4%) (25,512)
Net Assets 100.0% $ 6,850,711
The accompanying notes are an integral part of the financial statements.
a non-income producing security
19
<PAGE>
Healthcare
Performance
The ICON Healthcare Fund (the "Fund") opened on February 24, 1997. The Fund
under-performed its benchmark, the Lipper Health/Biotechnology Funds Index, by
approximately 9% over the period 10/1/98 to 3/31/99. The Fund's total return for
this six month period was 10.43%. The Lipper Health/Biotechnology Funds Index
return was 19.89% for the same time period. The Index rose at the same rate as
the largest industry in the sector - Drugs/Pharmaceuticals. The Fund sold this
holding during the period due to excessive valuations. In the short term, the
absence of this industry has hurt performance relative to the index.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
The Healthcare sector has benefited from heavy domestic spending on health care,
which has been caused by an aging and wealthy population. The demand for the
various products provided by health care companies-drugs, medical products,
hospital care and long term care-is likely to persist for some time.
Industry Highlight
In the last six months, the Advisor sold the Drugs/Pharmaceuticals industry and
reduced the Fund's investment in the Healthcare (Diversified) industry. These
are the two largest industries in the sector as measured by market
capitalization. The Advisor increased the Fund's weightings in the Managed Care
industry and added the Healthcare (Drugs) industry. These two industries now
constitute approximately 60% of the Fund.
One of the largest industry holdings is Managed Care. The industry comprises
approximately 30% of the Fund and includes companies such as Aetna, Express
Scripts, Oxford Health Plans and Foundation Health. 1998 proved to be a
difficult year for these companies. Stock prices fell as companies struggled to
restrain costs and integrate merged operations in a tough pricing environment.
As industry conditions improve, stock prices have rebounded, making the industry
an attractive investment.
The other large industry holding is Healthcare (Drugs). This industry includes
companies such as Watson Pharmaceuticals, Mylan Labs, Sepracor and Jones
Pharmaceutical. The industry comprises approximately 30% of the Fund. These
companies have posted solid earnings gains as the demand for drugs remains
strong, which has resulted in a healthy appreciation in stock prices.
Current Outlook
The Advisor is optimistic regarding the Healthcare sector. The strong
demographic and economic trends that underpin this sector are expected to remain
in place. Although the largest industry in the sector, Drugs/Pharmaceuticals,
appears extremely overvalued, several other industries continue to look
attractive to our style of investment management. Based on valuation and
momentum characteristics of the industries in the Fund, we are optimistic that
opportunities remain for these industries.
20
<PAGE>
Healthcare
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 98.7%
Top 10 Equity Holdings (% of Assets) 39.6%
Number of Stocks 35
Cash & Cash Equivalents 1.3%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Alpharma Inc. CLA 4.4%
Guidant Corp. 4.4%
Medimmune 4.3%
Jones Pharma Inc 4.1%
Express Scripts Inc. Class A 4.0%
Foundation Health System 3.9%
ICN Pharmaceuticals 3.9%
Sepracor 3.8%
Johnson & Johnson 3.4%
Mylan Laboratories 3.4%
- --------------------------------------------------------------------------------
Top Industries March 31, 1999 (unaudited)
Healthcare (Drugs) 29.6%
Managed Care 29.3%
Medical Products/Supplies 21.4%
Healthcare (Diversified) 18.1%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The Lipper Health/Biotechnology Funds Index is a total return performance index
consisting of the largest mutual funds within its respective investment
objective category. It is comprised of 10 funds. The Lipper Health/
Biotechnology Funds Index is an unmanaged index that includes the reinvestment
of dividends and does not reflect deductions for commission, management fees and
all expenses. Individuals cannot invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
21
<PAGE>
Healthcare
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares or Principal Amount Market Value
Common Stocks 98.4%
Healthcare (Diversified) 18.1%
19,200 Abbott Laboratories $ 898,800
6,400 Allergan Inc. 562,400
14,600 American Home Products Corp. 952,650
14,800 Bristol-Myers Squibb Co. 951,825
11,400 Johnson & Johnson 1,068,038
24,400 Sierra Health Servicesa 317,200
15,200 Warner-Lambert Co. 1,006,050
-------------------------------------------------------------
Total Healthcare (Diversified) 5,756,963
Managed Care 29.3%
11,900 Aetna Life and Casualty Co. 987,700
41,000 Concentra Managed Care 595,950
54,000 Coventry HealthCare 405,000
14,900 Express Scripts Inc. Class Aa 1,280,469
60,400 First Health Group Corp.a 970,175
101,000 Foundation Health System 1,230,935
48,800 Humana Inc. 841,800
51,200 Oxford Health Plans 800,000
13,150 Pacificare Health Systems 897,490
56,600 Phycor, Inc.a 268,850
20,750 United Healthcare Corp. 1,091,969
--------------------------------------------------------------
Total Managed Care 9,370,338
Healthcare (Drugs) 29.6%
35,800 Alpharma Inc. CLA 1,405,150
33,000 Barr Laboratories 1,006,500
48,700 ICN Pharmaceuticals 1,226,631
37,200 Jones Pharma Inc. 1,292,700
22,800 Medimmune 1,349,475
39,000 Mylan Laboratories 1,070,062
10,700 Sepracor 1,201,075
20,500 Watson Pharmaceuticals 904,562
--------------------------------------------------------------
Total Healthcare (Drugs) 9,456,155
Shares or Principal Amount Market Value
Common Stocks - continued
Medical Products/Supplies 21.4%
11,000 Ballard Medical Products $ 268,125
10,300 Bausch & Lomb 669,500
12,000 Baxter International Inc. 792,000
15,200 Becton Dickinson Co. 582,350
19,200 Biomet Inc. 805,200
22,800 Boston Scientific Corp.a 924,825
22,800 Guidant Corp. 1,379,400
12,600 Medtronic, Inc. 904,050
10,500 Stryker Corp. 529,594
-------------------------------------------------------------
Total Medical Products/Supplies 6,855,044
Total Common Stocks
(Cost $27,402,402) 31,438,500
-------------------------------------------------------------
Short-Term Commercial Notes 1.3%
$7,557 General Mills Demand Note
4.54% 11/9/99 7,557
-------------------------------------------------------------
$203,994 Warner Lambert Demand Note
4.54% 7/26/99 203,994
-------------------------------------------------------------
$213,000 American Family Demand Note
4.54% 7/26/99 213,000
-------------------------------------------------------------
Total Short-Term Commercial Notes
(Cost $424,551) 424,551
Total Investments 99.6%
(Cost $27,826,953) 31,863,051
-------------------------------------------------------------
Assets less other Liabilities 0.4% 89,783
Net Assets 100.0% $ 31,952,834
The accompanying notes are an integral part of the financial statements.
a non-income producing security
22
<PAGE>
Leisure
Performance
The ICON Leisure Fund (the "Fund") opened on May 9, 1997. The Fund
under-performed its benchmark, the S&P Entertainment/Leisure Composite Index,
over the period 10/1/98 to 3/31/99. The Fund's total return for this six month
period was 21.90%. The S&P Entertainment/Leisure Composite Index return was
45.43% for the same time period. The benchmark's return is due to its
concentration in a few large capitalization stocks that have posted excellent
six month returns. Stellar performers Disney, McDonalds and Time Warner account
for over 60% of the benchmark's market capitalization. The ICON Leisure Fund's
performance relative to its benchmark was also hurt by the Fund's holdings in
Tobacco stocks.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
The Leisure sector has benefited from the strong domestic economy. Low
unemployment, rising income and a booming stock market have increased the
discretionary spending of the American consumer. This has been good for the
bottom line of many companies operating in the Leisure sector.
Industry Highlights
In the last six months, stocks in the Lodging-Hotels industry were added to the
ICON Leisure Fund. These stocks were chosen based on their combination of
attractive valuation and good momentum. To accommodate this and rebalance the
portfolio, weightings in the Restaurants, Broadcasting (TV/Radio/Cable) and
Tobacco industries were reduced during the last six months.
The largest industry holding is Gaming Lottery & Parimutuel. New purchases in
the last six months have increased the Fund's weighting in this sector. The four
stocks held are Mirage, Harrah's, Circus Circus and IGT. The recent increase in
exposure to this industry was based on its favorable combination of attractive
valuations and momentum. As these stocks have not fully participated in the bull
market in recent years, we believe they have considerable upside potential.
Although reduced during the last six months, Restaurant stocks is the second
largest industry holding in the ICON Leisure Fund. Currently, Restaurant stocks
comprise approximately 25% of the Fund.
Stocks held in this industry include such well known names as McDonalds and
Starbucks. These two stocks have benefited from the equity market's infatuation
with large capitalization stocks. Other stocks held in the fund include Tricon
Global Restaurants, Wendy's and Darden. This industry has remained a core
holding of the Fund since its inception.
Current Outlook
Many areas within the Leisure sector continue to look attractive to our style of
investment management. This sector has generally appreciated with the market
over the last six months, but based on valuation and momentum characteristics of
the five industries in the Fund, we are optimistic that opportunities remain.
23
<PAGE>
Leisure
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 100.0%
Top 10 Equity Holdings (% of Net Assets) 57.7%
Number of Stocks 24
Cash & Cash Equivalents 0.0%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Circus Circus Enterprises, Inc. 6.8%
Harrah's Entertainment, Inc. 6.8%
Mirage Resorts Inc. 6.8%
TCA Cable TV Inc. 6.7%
Cox Communications Inc. Class A 5.9%
Comcast Corp. Class A 5.4%
RJR Nabisco Holdings Corp. 5.1%
Marriott Int'l Class A 4.8%
UST Inc. 4.8%
Int'l Game Technology 4.6%
- --------------------------------------------------------------------------------
Top Industries March 31, 1999 (unaudited)
Gaming, Lottery & Parimutuel 25.1%
Restaurants 25.0%
Broadcasting-TV, Radio, Cable 18.0%
Lodging-Hotels 15.5%
Tobacco 14.3%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The S&P Entertainment/Leisure Composite Index is a capitalization-weighted index
of all the stocks in the Standard & Poor's 500 that are involved in the business
of entertainment and leisure related products and services. It is comprised of
15 stocks. The S&P Entertainment/Leisure Composite Index is an unmanaged index
that includes the reinvestment of dividends and does not reflect deductions for
commission, management fees and all expenses. Individuals cannot invest in the
index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
24
<PAGE>
Leisure
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares Market Value
Common Stocks 97.9%
Tobacco 14.3%
49,600 Philip Morris Cos. Inc. $ 1,745,300
82,100 RJR Nabisco Holdings Corp. 2,052,500
73,700 UST Inc. 1,925,413
------------------------------------------------------------
Total Tobacco 5,723,213
Broadcasting-TV, Radio, Cable 18.0%
34,500 Comcast Corp. Class A 2,171,344
31,200 Cox Communications Inc. Class Aa 2,359,500
61,800 TCA Cable TV Inc. 2,688,300
------------------------------------------------------------
Total Broadcasting-TV, Radio, Cable 7,219,144
Lodging-Hotels 15.5%
59,200 Hilton Hotels 832,500
57,100 Marriott Int'l Class A 1,919,987
168,800 Prime Hospitality 1,677,450
48,200 Promus Hotel Corp. 1,753,275
-------------------------------------------------------------
Total Lodging-Hotels 6,183,212
Shares Market Value
Common Stocks - continued
Restaurants 25.0%
198,100 Boston Chicken Inc.a $ 138,670
30,700 Brinker International Inc.a 792,444
18,700 CBRL Group 336,600
22,143 CKE Restaurants Inc. 437,324
61,300 Darden Restaurants Inc. 1,264,313
38,600 McDonalds Corp. 1,749,062
36,900 Outback Steakhouse Inc.a 1,208,475
47,200 Starbucks Corp.a 1,324,550
24,600 Tricon Global Restaurantsa 1,728,150
36,000 Wendy's International Inc. 1,023,750
------------------------------------------------------------
Total Restaurants 10,003,338
Gaming, Lottery, & Parimutuel 25.1%
155,800 Circus Circus Enterprises Inc.a 2,736,237
142,800 Harrah's Entertainment Inc.a 2,722,125
126,000 Intl Game Technology 1,834,875
128,900 Mirage Resorts Inc.a 2,739,125
-------------------------------------------------------------
Total Gaming, Lottery & Parimutuel 10,032,362
Total Investments 97.9%
(Cost $33,129,610) 39,161,269
-------------------------------------------------------------
Assets less other Liabilities 2.1% 840,302
Net Assets 100.0% $ 40,001,571
The accompanying notes are an integral part of the financial statements.
a non-income producing security
25
<PAGE>
Technology
Performance
The ICON Technology Fund (the "Fund") opened on February 19, 1997. While past
performance does not guarantee future results, the Fund outperformed its
benchmark, the Lipper Science & Technology Funds Index, by more than 6% over the
period 10/1/98 to 3/31/99. The Fund's total return for this six month period was
61.88%. The Lipper Science & Technology Funds Index return was 55.01% for the
same time period. Many of the Fund's industry holdings performed strongly during
the period. Performance was helped in particular by investments in the
Semiconductor and Computer Peripheral industries.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
The Technology sector has benefited from the strong domestic economy. Both
businesses and consumers are spending heavily to upgrade communication networks,
computers and related products. These trends are likely to continue as
technology-related products find their way into more and more consumer goods.
Industry Highlights
In the last six months, the Advisor made only minor changes in the Fund's
holdings. The Fund's largest weightings are in the Electronic Semiconductors and
Communications Equipment industries. These two industries comprise over 60% of
the Fund. Other large holdings are in the Peripherals and Computer Networking
industries.
The largest industry holding is Communications Equipment. The industry comprises
approximately 26.4% of the Fund and includes companies such as Lucent, Motorola,
Qualcomm and Scientific Atlanta. These companies have benefited from strong
spending by telephone and cable companies to upgrade their networks.
The second largest industry holding is Electronic Semiconductors. This industry
includes companies such as Intel, Texas Instruments, Micron Technology, Linear
Technology and Maxim. This industry comprises approximately 35% of the Fund. The
excess supply conditions that plagued the industry in 1998 appear to have
dissipated. With supply and demand in balance, the industry faces a much
healthier operating environment.
Current Outlook
Many areas within the Technology sector continue to look attractive to our style
of investment management. This sector has generally outperformed the market over
the last six months, but based on valuation and momentum characteristics of the
industries in the Fund, we are optimistic that opportunities remain.
26
<PAGE>
Technology
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 93.6%
Top 10 Equity Holdings (% of Assets) 40.1%
Number of Stocks 43
Cash & Cash Equivalents 6.4%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Cisco Systems Inc. 5.2%
Qualcomm 4.8%
EMC Corp./MA 4.1%
ADC Telecommunications 4.0%
Intel Corp. 4.0%
Northern Telecom Ltd. 4.0%
Motorola, Inc. 3.9%
Tellabs Inc. 3.5%
Ascend Communications 3.3%
Lucent Technologies 3.3%
- --------------------------------------------------------------------------------
Top Industries March 31, 1999 (unaudited)
Communications Equipment 26.4%
Electronic Semiconductors 23.4%
Computer Networking 13.7%
Peripherals 12.1%
Equipment (Semiconductors) 11.4%
Computer Hardware 7.0%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The Lipper Science & Technology Funds Index is a total return performance index
consisting of the largest mutual funds within its respective investment
objective category. It is comprised of 10 funds. The Lipper Science & Technology
Funds Index is an unmanaged index that includes the reinvestment of dividends
and does not reflect deductions for commission, management fees and all
expenses. Individuals cannot invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
27
<PAGE>
Technology
Schedule of Investments
March 31, 1999
(unaudited)
Shares or Principal Amount Market Value
Common Stocks 94.0%
Communications Equipment 26.4%
63,200 ADC Telecommunications Inc.a $ 3,013,850
23,500 Lucent Technologies 2,532,125
40,100 Motorola Inc. 2,937,325
49,220 Northern Telecom Ltd. 3,057,793
29,350 Qualcomm Inc.a 3,650,406
70,9500 Scientific-Atlanta Inc. 1,933,388
27,600 Tellabs Inc.a 2,697,900
Total Communications Equipment 19,822,787
Computer Hardware 7.0%
31,898 Compaq Computer Corp. 1,010,768
25,200 Dell Computer Corp.a 1,030,050
15,200 Hewlett-Packard Co. 1,030,750
5,900 International Business Machines 1,045,775
9,700 Sun Microsystems, Inc.a 1,213,106
Total Computer Hardware 5,330,449
Computer Networking 13.7%
79,800 3Com Corp.a 1,860,337
30,500 Ascend Communicationsa 2,552,469
237,900 Cabletron Systemsa 1,947,806
35,837 Cisco Systems, Inc.a 3,926,391
Total Computer Networking 10,287,003
Peripherals 12.1%
24,500 EMC Corp./MAa 3,129,875
65,900 Komag, Inc.a 288,313
20,900 Lexmark Intl. Grp., Inc. Class Aa 2,335,575
39,200 Quantum Corp.a 705,600
59,600 Read-Rite Corp.a 392,987
39,800 Seagate Technologya 1,176,587
39,600 Storage Technology Corp. 1,103,850
Total Peripherals 9,132,787
Equipment (Semiconductors) 11.4%
39,500 Applied Materialsa 2,436,656
39,900 Kla-Tencor Corporationa 1,937,644
36,500 Novellus Systems, Inc.a 2,012,063
40,700 Teradyne,Inc.a 2,220,694
Total Equipment (Semiconductors) 8,607,057
Shares or Principal Amount Market Value
Common Stocks - continued
Electronic Semiconductors 23.4%
44,400 Advanced Micro Devicesa $ 688,200
25,800 Altera Corp.a 1,535,100
29,800 Analog Devicesa 886,550
25,300 Atmel Corp.a 384,244
9,700 Dallas Semiconductor Corp.a 374,663
10,500 ETEC Systemsa 309,094
25,600 Intel Corp. 3,043,200
8,400 Lattice Semiconductor Corp.a 382,725
25,600 Linear Technology Corp. 1,312,000
35,300 LSI Logic Corp.a 1,100,919
23,300 Maxim Integrated Productsa 1,261,112
37,300 Microchip Technology Inc.a 1,291,512
26,400 Micron Technology Inc. 1,273,800
31,400 National Semiconductor Corp.a 292,413
15,400 Texas Instruments 1,528,450
47,000 Xilinx Inc.a 1,906,437
Total Electronic Semiconductors 17,570,419
Total Common Stocks
(Cost $51,724,289) 70,750,502
Short-Term Commercial Notes 6.4%
$963,000 American Family Demand Note
4.56% 7/26/99 963,000
$961,329 Wisconsin Electric Demand Note
4.56% 7/13/99 961,329
$2,893,641 Pitney Bowes Demand Note
4.54% 8/13/99 2,893,641
Total Short-Term Commercial Notes
(Cost $4,817,970) 4,817,970
Total Investments 100.6%
(Cost $56,542,259) 75,568,472
Liabilities less other Assets (0.6%) (487,420)
Net Assets 100.0% $ 75,081,052
The accompanying notes are an integral part of the financial statements.
a non-income producing security
28
<PAGE>
Telecommunication and Utilities
Performance
The ICON Telecommunication & Utilities Fund (the "Fund") opened on July 9, 1997.
The Fund had very similar performance to its benchmark, the Lipper Utilities
Funds Index, over the period 10/1/98 to 3/31/99. The Fund's total return for
this six month period was 6.18%. The Lipper Utilities Funds Index return was
6.42% for the same time period. Since its inception and in the last year,
however, the Fund has significantly outpaced its benchmark.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
Stock price appreciation in the Telecommunication and Utilities sector slowed in
the previous six months from the rapid pace established in early 1998. For much
of 1998, many stocks in this sector were buoyed by falling interest rates and
their perceived safety. Additionally, many Telephone and Electric Utilities
stocks benefited from their large capitalization status. After large price
run-ups in 1998, however, many of these stocks have recently posted returns more
in line with historical norms.
Industry Highlights
In the last six months, the Fund has consistently held positions in two
industries: Electric Companies and Telephone Services. Currently, the Fund is
split approximately equally between these two industries. During the last six
months, a small position in the Cellular/Wireless Telecommunications industry
was sold.
Electric Companies stocks comprise approximately half of the Fund. These stocks,
with their high dividend yields, have historically been perceived by the market
as defensive. However, as witnessed by their performance over the last few
years, these stocks have capital appreciation potential as well. With the trends
toward deregulation and diversification in the Electric Companies industry,
these stocks should continue to attract investor attention. Our largest Electric
Companies positions in the Fund include Peco Energy, Public Service, Pacific Gas
& Electric and Texas Utilities.
Telephone Services stocks account for the remaining equity position in the Fund.
The Telephone Services industry has been transitioning to a more competitive
environment since the Telecommunications Act of 1996. This deregulation has
spurred industry merger and acquisition activity. Many companies in this
industry have been takeover targets. Additionally, Telephone Services companies
have acquired entities in other industries. This merger and acquisition activity
has added volatility and additional upside potential to Telephone Services
shares.
Current Outlook
Price appreciation among stocks in the Fund has slowed in the last six months.
Valuations indicate that many of these stocks are trading near their intrinsic
value. Although not at a deep discount, stocks within the Fund may continue to
benefit from the merger and acquisition activity brought on by industry
deregulation.
29
<PAGE>
Telecommunication and Utilities
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 100.0%
Top 10 Equity Holdings (% of Net Assets) 48.2%
Number of Stocks 27
Cash & Cash Equivalents 0.0%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Bell Atlantic 5.1%
BellSouth Corp. 5.0%
Century Telephone Enterprises, Inc. 5.0%
Frontier Corp. 4.9%
GTE Corp. 4.8%
US West, Inc. 4.8%
Alltel Corp. 4.7%
Telephone & Data 4.7%
Aliant Communications Inc. 4.6%
Ameritech, Corp. 4.6%
- --------------------------------------------------------------------------------
Top Industries March 31, 1999 (unaudited)
Telephone Services 51.3%
Electric Companies 47.6%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The Lipper Utilities Funds Index is a total return performance index consisting
of the largest mutual funds within its respective investment objective category.
It is comprised of 30 funds. The Lipper Utilities Funds Index is an unmanaged
index that includes the reinvestment of dividends and does not reflect
deductions for commission, management fees and all expenses. Individuals cannot
invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
30
<PAGE>
Telecommunication and Utilities
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares Market Value
Common Stocks 98.9%
Telephone Services 51.3%
9,000 Aliant Communications Inc. $ 368,437
5,970 Alltel Corp. 372,379
6,400 Ameritech Corp. 370,400
7,870 Bell Alantic 406,781
10,000 BellSouth Corp. 400,625
5,650 Century Telephone Enterprises, Inc. 396,912
7,500 Frontier Corp. 389,062
6,300 GTE Corp. 381,150
5,500 SBC Communications Inc. 259,188
6,700 Telephone & Data 377,713
7,000 U S West Inc. 385,438
-----------------------------------------------------------------
Total Telephone Services 4,108,085
Electric Companies 47.6%
5,600 American Electric Power Co., Inc. 222,250
6,000 Carolina Power & Light 226,875
7,900 Cinergy Corp. 217,250
5,500 Consolidated Edison of NY 249,219
5,900 Dominion Resources Inc. 217,931
4,200 Duke Power 229,425
10,400 Edison International 231,400
9,500 Entergy Corp. 261,250
4,400 FPL Group Inc. 234,300
9,000 Pacific Gas & Electric 279,563
14,400 Pacificorp 248,400
7,100 Peco Energy Co. 328,375
7,200 Public Service Enterprises 274,950
3,700 Reliant Energy Inc. 96,431
9,700 Southern Co. 226,131
6,300 Texas Utilities Co. 262,631
-----------------------------------------------------------------
Total Electric Companies 3,806,381
Shares Market Value
Common Stocks - continued
Total Investments 98.9%
(Cost $7,484,992) 7,914,466
----------------------------------------------------------------
Assets less other Liabilities 1.1% 91,026
Net Assets 100.0% $ 8,005,492
The accompanying notes are an integral part of the financial statements.
a non-income producing security.
31
<PAGE>
Transportation
Performance
The ICON Transportation Fund (the "Fund") opened on May 9, 1997. The Fund
under-performed its benchmark, the S&P Transportation Index, over the period
10/1/98 to 3/31/99. The Fund's total return for this six month period was
19.05%. The S&P Transportation Index return was 20.93% for the same time period.
The Fund benefited from its holdings in the Air Freight and Truckers industries,
but its performance was hurt by its Auto Parts & Equipment and Railroad
industries exposure.
The U.S. stock market, as measured by the S&P 500 Index, has posted exceptional
returns in the last six months. Fears of a global recession and excessive equity
valuation were short lived, as the market quickly recovered from the 1998 late
summer correction. The Dow Jones Industrial Average, a price weighted equity
benchmark, was very near the 10,000 level as the recent quarter ended. Publicity
from the 10,000 milestone highlighted the strong performance of large
capitalization stocks in the current bull market. Recent market appreciation,
however, has not been broad. Many middle and small capitalization stocks,
although recovering from their October 1998 lows, have not kept pace with the
narrow market advance.
Transportation stocks are cyclical, as their performance is dependent on the
state of the economy. As investor worries over the domestic economy subsided in
the final months of 1998, Transportation stocks rallied. Increasing fuel prices
in 1999, however, have hurt the share prices of many Transportation stocks.
Industry Highlights
In the last six months, Air Freight stocks were added to the portfolio. These
stocks were selected based on their attractive valuations and recent price
momentum. Their performance has thus far contributed to the appreciation of the
Fund. At approximately one third of the Fund, Air Freight is currently the
largest industry holding.
The second largest industry holding is Truckers. Stocks in this industry include
US Freightways, Werner and JB Hunt. These stocks rallied strongly off of the
market lows in October of 1998 but have recently fallen in price. Rising oil
prices increase the costs and negatively impact the bottom line of Trucking
companies. Trucking stocks remain a solid investment as they continue to look
undervalued.
The Fund also has positions in Auto Parts & Equipment and Railroads. Stocks in
these industries have posted disappointing results in recent months. Valuations
remain attractive, and the Advisor is optimistic about the prospects for both
industries. Stocks held in the Auto Parts & Equipment industry include Dana,
Genuine Parts and Goodyear Tire. The three largest holdings in the Railroad
industry are Burlington Northern, CSX and Kansas City Southern.
Current Outlook
Transportation stocks have recovered off of their lows experienced in October of
1998; however, appreciation has not been uniform in the sector. Air Freight
stocks have posted stellar returns, and other industries held in the Fund remain
undervalued.
32
<PAGE>
Transportation
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 98.4%
Top 10 Equity Holdings (% of Net Assets) 49.6%
Number of Stocks 30
Cash & Cash Equivalents 1.6%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Expeditors Int'l Wash Inc. 7.6%
FDX Corporation 7.5%
CNF Transportation Inc. 6.7%
Airborne Freight Corp. 6.5%
US Freightways Corp. 4.1%
Hunt (J.B.) Transport 3.7%
Air Express 3.6%
Ryder System Inc. 3.6%
CSX Corp. 3.2%
Burlington Northern Santa Fe Corp. 3.1%
- --------------------------------------------------------------------------------
Top Industries March 31, 1999 (unaudited)
Air Freight 32.0%
Truckers 27.7%
Railroads 20.4%
Auto Parts & Equipment 17.5%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. Past performance does not guarantee future results.
The S&P Transportation Index is a capitalization-weighted index that measures
the performance of the transportation sector of the S&P SuperComposite 1500
Index. It is comprised of 39 stocks. The S&P Transportation Index is an
unmanaged index that includes the reinvestment of dividends and does not reflect
deductions for commission, management fees and all expenses. Individuals cannot
invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
33
<PAGE>
Transportation
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares or Principal Amount Market Value
Common Stocks 97.6%
Auto Parts & Equipment 17.5%
22,800 Cooper Tire & Rubber Co. $ 418,950
16,018 Dana Corp. 608,684
21,500 Genuine Parts Co. 619,469
12,500 Goodyear Tire & Rubber Co. 622,656
13,900 ITT Industries Inc. 491,712
12,000 Modine Manufacturing Co. 336,750
16,800 Snap-On Tools Inc. 487,200
12,900 TRW Inc. 586,950
---------------------------------------------------------------
Total Auto Parts & Equipment 4,172,371
Truckers 27.7%
36,800 American Freightways Corp. 473,800
32,200 Arnold Industries Inc. 478,975
42,000 Hunt (J.B.) Transport 882,000
19,400 Landstar Systems Inc.a 642,625
24,500 M S Carriers Inc.a 647,719
55,550 Rollins Truck Leasing 524,253
30,600 Ryder System Inc. 845,325
29,900 U.S. Freightways Corp. 982,962
45,975 Werner Enterprises Inc. 724,106
22,000 Yellow Corp.a 382,250
---------------------------------------------------------------
Total Truckers 6,584,015
Air Freight 32.0%
57,300 Air Express 866,664
50,000 Airborne Freight Corp. 1,556,250
42,300 CNF Transportation Inc. 1,599,469
33,600 Expeditors Int'l Wash. Inc. 1,814,400
19,200 FDX Corporation 1,782,000
---------------------------------------------------------------
Total Air Freight 7,618,783
Shares or Principal Amount Market Value
Common Stocks - continued
Railroads 20.4%
22,100 Burlington Northern Santa Fe Corp. $ 726,537
19,800 CSX Corp. 770,963
21,200 GATX Corp. 698,275
12,700 Kansas City Southern Inds 723,900
26,100 Norfolk Southern Corp. 688,387
13,200 Union Pacific Corp. 705,375
40,300 Wisconsin Central Transportationa 533,975
----------------------------------------------------------------
Total Railroads 4,847,412
Total Common Stocks
(Cost $22,643,076) 23,222,581
----------------------------------------------------------------
Short-Term Commercial Notes 1.5%
- --------------------------------------------------------------------------------
$367,651 General Mills Demand Note
4.54% 11/9/99 367,651
Total Short-Term Commercial Notes
(Cost $367,651) 367,651
----------------------------------------------------------------
Total Investments 99.1%
(Cost $23,010,727) 23,590,232
----------------------------------------------------------------
Assets less other Liabilities 0.9% 194,855
- -------------------------------------------------------------------------
Net Assets 100.0% $ 23,785,087
The accompanying notes are an integral part of the financial statements.
a non-income producing security
34
<PAGE>
Short-Term Fixed Income
Performance
The ICON Short-Term Fixed Income Fund (the "Fund") opened on February 7, 1997.
The Fund's total return over the period 10/1/98 to 3/31/99 was 1.67%. The
Merrill Lynch 1 Year Treasury Index return was 1.90% for the same period.
Fund Highlights
The objective of the ICON Short-Term Fixed Income Fund is to attain high current
income consistent with the preservation of capital. Under normal conditions, the
Fund invests in US Treasury and Agency obligations. The Advisor aims to keep the
duration of the Fund toward the middle of the Fund's normal operating range of
0.5 to 1.5 years.
The Federal Reserve Board decided to leave interest rates unchanged during the
first quarter, after reducing rates three times in quick succession last fall.
Long-term yields climbed higher, from 5% to 5.7%, through January and February,
and have remained in the 5.5-5.7% range since then. The Fund's short duration
has therefore been an advantage during this period of a steepening yield curve.
Current Outlook
The Advisor expects to see a moderate growth, low inflation environment in the
near term. Producer and consumer price increases continue to remain subdued; and
although unemployment is at an historically low level, there has been no sign of
wage inflation. Given this scenario, the Advisor believes the Federal Reserve
Board is likely to maintain its bias against raising rates.
35
<PAGE>
Short-Term Fixed Income
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Principal Amount Market Value
U.S. Government Agencies 103.7%
$2,000,000 Federal Home Loan Bank
5.8% 11/4/99 $ 2,009,590
$2,000,000 Federal National Mortgage
5.4% 9/1/00 2,006,260
$70,000 Federal Farm Credit Bank
5.5% 8/03/99 70,144
Total U.S. Government Agencies (103.7%)
(Cost $4,079,161) 4,085,994
- --------------------------------------------------------------------------------
Other Liabilities less Assets (3.7%) (146,464)
Net Assets 100.0% $ 3,939,530
The accompanying notes are an integral part of the financial statements.
36
<PAGE>
Asia Region
Performance
The ICON Asia Fund (the "Fund") opened on February 25, 1997. While past
performance does not guarantee future results, the Fund outperformed its
benchmark, the Morgan Stanley Capital International (MSCI) Pacific Index, over
the period 10/1/98 to 3/31/99 by 1.39%. The Fund's total return for this six
month period was 40.72%. The MSCI Pacific Index return was 39.33% for the same
time period. The largest weighting of both the Fund and the benchmark has been
in the Japan equity market, which has rebounded sharply in the last six months.
Global equity markets generally posted excellent results over the last six
months. Fears of a global recession and excessive equity valuation were short
lived, as most markets quickly recovered from the 1998 July through October
correction. European equities markets have resumed their upward trends. Asian
markets have also rebounded strongly. Led by the recovery in Japan, Asian equity
markets closed the quarter with strong price momentum.
The Asian crisis has received considerable publicity in the last few years.
Plunging currencies and struggling economies have led to disappointing returns
in many Asian equity markets. Recent trends, however, are encouraging. Japanese
government policies to stimulate the economy are finally being well received by
the global marketplace. Asian economies are starting to rebound, and their
currencies have strengthened as a result.
Country Highlights
Country holdings have remained consistent over the last six months. The largest
position, Japan, comprises approximately 85% of the Fund. The Fund's Japanese
holdings are supplemented by positions in Hong Kong and Malaysia.
The Advisor is very bullish on the Japanese equity market. Given current
fundamentals, the Advisor measures Japanese stocks to be more than 50%
underpriced. A recent recovery in share prices, following a bear market during
much of 1990s, has also been an encouraging sign. With valuations attractive and
solid price momentum, the Japanese market is a compelling investment opportunity
at this time.
Hong Kong stocks account for 7% of the portfolio. The Hong Kong stock market has
a history of high returns and above average volatility. The performance of this
market over the last year has been no different. In the last six months, the
market has quickly recovered from a 40% decline experienced during 1998.
In 1998, the Malaysian government imposed capital controls on foreign investors.
This restricted the ability to move money in and out of the Malaysian equity
market. Our current investment in Malaysia is subject to penalties if withdrawn.
These penalties decrease over time and are eventually reduced to zero. Most
economists agree that these types of capital controls are generally
counterproductive. After falling over 50% during 1998, the market has made a
partial recovery during the last six months. The Advisor is continually
evaluating the benefits and costs of holding this position.
Current Outlook
After an extended bear market, Japanese stocks are showing signs of a recovery.
The economy, currency and stock market are all responding favorably to
governmental plans to stimulate the economy and address its structural problems.
Other Asian markets are recovering as well. The Advisor is bullish on the
prospects for the ICON Asia Fund.
37
<PAGE>
Asia Region
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 91.1%
Top 10 Equity Holdings (% of Assets) 51.7%
Number of Stocks 90
Cash & Cash Equivalents 8.9%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Nippon Telephone & Telegraph Corp. 11.4%
Toyota Motor Corporation 9.9%
Bank of Tokyo-Mitsubishi Ltd. 6.0%
Honda Motor Company 4.0%
Sumitomo Bank, Ltd. 4.0%
Matsushita Electric Industrial Co, Ltd. 3.8%
Sony Corporation 3.6%
Takeda Chemical 3.3%
Fujitsu Ltd. 2.9%
Toyko Electric Power 2.8%
- --------------------------------------------------------------------------------
Top Countries March 31, 1999 (unaudited)
Japan 85.8%
Hong Kong 7.0%
Malaysia 6.3%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. International investing involves greater risk than
U.S. investments which include political, economic uncertainties and the risk of
currency fluctuations. Past performance does not guarantee future results.
The Morgan Stanley Capital International (MSCI) Pacific Index is comprised of
stocks traded in the developed markets of the Pacific Basin (Australia, Hong
Kong, Japan, Malaysia, New Zealand, and Singapore). The index tries to capture
at least 60% of investable capitalization in said markets subject to constraints
governed by industry representation, maximum liquidity, maximum float, and
minimum cross-ownership (companies with exposure in multiple countries). The
index is capitalization weighted. The MSCI Pacific Index is an unmanaged index
that does not include the reinvestment of dividends and does not reflect
deductions for commission, management fees and expenses. Individuals cannot
invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
38
<PAGE>
Asia Region
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares Market Value
Common Stocks & Warrants 99.1%
Hong Kong 7.0%
27,400 Bank of East Asia $ 46,494
37,000 Cathay Pacific Airways 42,493
34,000 Cheung Kong Holdings 258,852
4,000 Cheung Kong Infrastructure 7,639
22,000 China Light & Power Holdings Ltd. 105,605
40,000 Chinese Estates HL 5,884
4,000 Citic Pacific Ltd. 8,413
6,500 Dickson Concepts Intl. 5,284
3,000 Guoco Group Ltd. 5,284
30,000 Hang Lung Dev. Co. 36,389
29,100 Hang Seng Bank 267,546
29,000 Hong Kong & Shanghai Hotels 21,891
131,200 Hong Kong Telecom 258,181
63,700 Hong Kong & China Gas 90,007
17,600 Hopewell Holdings 8,517
54,000 Hutchison Whampoa Ltd. 425,054
23,000 Hysan Development 29,976
11,000 Miramar Hotel 11,355
13,000 New World Development 25,582
27,000 Shangri La Asia Ltd. 25,956
74,000 Shun Tak Holdings 14,323
40,434 Sun Hung Kai Properties 301,314
40,500 Swire Pacific Ltd. 27,960
6,000 Television Broadcast 21,795
40,000 Wharf Holdings 61,423
-----------------------------------------------------------------
Total Hong Kong 2,113,217
Shares Market Value
Common Stocks & Warrants - continued
Japan 85.8%
132,000 Bank of Tokyo-Mitsubishi Ltd. $ 1,819,000
22,000 Bridgestone Corp. 561,007
23,000 Canon Inc. 569,029
20,000 Dai Nippon Printing Co. Ltd. 303,977
24,000 Denso Corporation 471,165
113 East Apan Railway 671,722
103,000 Fuji Bank Ltd. 609,669
13,000 Fuji Photo Film 491,768
56,000 Fujitsu Ltd. 899,367
101,000 Hitachi 747,928
27,000 Honda Motor Company 1,219,709
79,000 Industrial Bank of Japan Ltd. 533,649
11,000 Ito-Yokado Co. Ltd. 707,760
25,800 Kansai Electric Power 521,752
27,000 Kirin Brewery Co. Ltd. 316,440
4,000 Kyocera Corp. 215,486
60,000 Matsushita Electric Industrial Co., Ltd. 1,170,313
32,000 Mitsubishi Estate Co. Ltd. 325,593
88,000 Mitsubishi Hvy Indysa 397,535
42,000 NEC Corporation 505,362
177,000 Nippon Steel Company 363,177
353 Nippon Telephone & Telegraph Corp. 3,457,573
61,000 Nissan Motor Company 236,933
51,000 Nomura Securities Co. 533,987
11,000 Sankyo Company Ltd. 235,920
29,000 Sharp Corporation 306,088
12,000 Sony Corporation 1,109,517
91,000 Sumitomo Bank, Ltd. 1,231,724
26,000 Takeda Chemical 1,007,685
40,000 Tokio Marine & Fire Insurances 456,304
40,500 Tokyo Electric Power 872,035
104,000 Toyota Motor Corporation 3,012,077
------------------------------------------------------------------
Total Japan 25,881,251
(continued)
39
<PAGE>
Asia Region (continued)
- --------------------------------------------------------------------------------
Shares Market Value
Common Stocks - continued
Malaysia 6.3% (See Note 4 on page 66)
33,800 AMMB Holdings Berhad $ 23,909
10,400 Berjaya Sports Toto Berhad 10,422
21,000 Commerce Asset-Holdings Berhad 17,419
27,000 Edaran Otomobil Nasional BHD 27,853
140,400 Ekran Berhad 21,134
88,000 Golden Hope Plantations 50,021
36,000 Hicom Holdings Berhad 7,579
109,000 Hong Leong Bank Berhad 51,632
47,000 Hume Industries Berhad 27,705
36,000 Jaya Tiasa Holdings Berhad 32,741
57,000 Kuala Lumpur Kepon Berhad 57,120
192,500 Magnum Corp Berhad 72,542
7,300 Malakoff Berhad 12,372
124,000 Malayan Banking Berhad 185,347
66,000 Malaysian International Shipping 67,251
66,333 Malaysian Resources Corp. 12,568
70,500 Naluri Berhad 6,753
15,200 Nestle (Malaysia) Berhad 42,560
30,000 New Straits Times Press 21,474
32,500 Oriental Holdings Berhad 41,053
39,000 Perusahaan Otomobil Nasional 41,463
24,500 Petronas Gas Berhad 39,716
94,400 Public Bank Berhad 42,530
39,000 Rashid Hussain BHD 15,189
96,000 Renong Berhad 12,328
72,000 Resorts World Berhad 70,939
85,000 RHB Capital Berhad 42,232
18,200 Rothmans of Pall Mall Berhad 86,211
157,000 Sime Darby Malay Regd 114,362
205,500 Telekom Malaysia 330,963
196,000 Tenaga Nasional Berhad 231,073
50,500 United Engineers Berhad 18,286
69,000 YTL Corp. Berhad 68,564
-------------------------------------------------------------------
Total Maylasia 1,903,311
Shares Market Value
Common Stocks - continued
Total Common Stocks
(Cost $28,235,253) $ 29,897,779
------------------------------------------------------------------
Total Demand Deposits 9.7%
4.797% Chase Bank Interest
Bearing Demand Deposit
(Cost $2,924,505) 2,924,505
------------------------------------------------------------------
Total Investments 108.8%
(Cost $31,159,758) 32,822,284
Other Liabilities less Assets (8.8%) (2,675,667)
------------------------------------------------------------------
Net Assets 100.0% $ 30,146,617
The accompanying notes are an integral part of the financial statements.
a non-income producing security.
40
<PAGE>
Asia Region (continued)
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Summary of Investments by Industry
% of Investments
Airlines 0.10%
Auto Equip 0.30%
Automobiles 15.02%
Banks 16.13%
Chemicals 1.61%
Computers 4.74%
Construction Materials 0.10%
Construction 0.30%
Electronic Components 8.67%
Electronic Materials 6.75%
Engineering 0.10%
Financial Services 2.12%
Food 1.41%
Hotel/Tourist 0.20%
Industrial Equipment 1.41%
Insurance 1.51%
Leisure 0.40%
Multi-Industry 2.32%
Oil Production 0.10%
Pharmacy 4.13%
Press Print 1.11%
Real Estate 3.23%
Sea Transportation 0.20%
Special Retail 2.42%
Steel Metal 1.21%
Telecommunications 13.61%
Textiles 0.10%
Tires & Rubber 1.92%
Tobacco 0.30%
Transportation 2.22%
TV, Radio 0.10%
Water Distribution 6.16%
- -----------------------------------------------------------------
Total 100.00%
The accompanying notes are an integral part of the financial statements.
41
<PAGE>
North Europe Region
Performance
The ICON North Europe Fund (the "Fund") opened on February 18, 1997. The Fund
under-performed its benchmark, The Morgan Stanley Capital International (MSCI)
Europe 15 Index, over the period 10/1/98 to 3/31/99. The Fund's total return for
this six month period was 2.79%. The MSCI Europe 15 Index return was 15.32% for
the same time period. The Fund benefited from its positions in Sweden and the
United Kingdom; however, weightings in Denmark and Germany were a drag on
portfolio performance in the last six months. The strong U.S. Dollar relative to
the Euro and many other European currencies reduced the returns to domestic
investors in European markets.
Global equity markets generally posted excellent results over the last six
months. Fears of a global recession and excessive equity valuation were short
lived, as most markets quickly recovered from the July 1998 through October 1998
correction. European equities markets have resumed their upward trends.
The European continent is successfully transitioning to the Euro. Despite fears
highlighted by the financial press, the initial currency conversion was nearly
transparent. Banks and other financial institutions had spent years preparing
for the event. The only negative short term trend has been the Euro's
depreciation relative to the dollar. However, as European countries continue to
integrate and synergies are realized, the outlook for the currency could
improve.
Country Highlights
Despite changing weightings, country holdings have remained consistent over the
last six months. The Fund holds two countries involved in the Euro: Germany and
Belgium. The remaining country positions are the United Kingdom, Denmark, and
Sweden.
The Fund's largest country holding is the United Kingdom, which represents
approximately one quarter of the Fund. As the Advisor has remained bullish on
this equity market, the large weighting in the United Kingdom has been
consistent during the last six months. The United Kingdom's economy is in a
period of steady growth and low interest rates. The equity market has responded
with steady appreciation over the last six months.
Stocks in Denmark account for approximately 20% of the Fund. As measured by the
Advisor's quantitative valuation equation, the Danish stock market appears
undervalued; however, stock prices have yet to respond. Stocks in Sweden, the
Fund's third largest country position, have fared much better recently. Led by
large capitalization stocks, Sweden and other Scandinavian markets have been
pacing the European equity advance.
Current Outlook
According to the Advisor's discipline of investing based on valuation and price
momentum, many opportunities exist in the North Europe Fund. European economies
have posted steady growth with low inflation, and these fundamentals have led to
significant stock market appreciation in many European markets. Despite market
appreciation, valuations remain attractive.
42
<PAGE>
North Europe Region
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 98.0%
Top 10 Equity Holdings (% of Assets) 31.4%
Number Stocks 113
Cash & Cash Equivalents 2.0%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
D/S Svenborg 4.4%
Ericsson 4.4%
Fortis "B" 3.4%
Den Danske Bank Group 3.2%
TeleDanmark 3.1%
Deutsche Telekom AG 2.7%
BP Amoco PLC 2.6%
KBC Bancassurance 2.6%
Astra AS-ASEKI 2.5%
Electrabel Corp. 2.5%
- --------------------------------------------------------------------------------
Top Countries March 31, 1999 (unaudited)
United Kingdom 23.3%
Denmark 20.9%
Sweden 19.6%
Germany 19.1%
Belgium 16.0%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. International investing involves greater risk than
U.S. investments which include political, economic uncertainties and the risk of
currency fluctuations. Past performance does not guarantee future results.
The Morgan Stanley Capital International (MSCI) Europe 15 Index is comprised of
stocks traded in the developed markets of Europe. The index tries to capture at
least 60% of investable capitalization in said markets subject to constraints
governed by industry representation, maximum liquidity, maximum float, and
minimum cross-ownership (companies with exposure in multiple countries). The
index is capitalization weighted. The MSCI Europe 15 Index is an unmanaged index
that does not include the reinvestment of dividends and does not reflect
deductions for commission, management fees and all expenses. Individuals cannot
invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
43
<PAGE>
North Europe Region
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares Market Value
Common Stocks 99.0%
Belgium 16.0%
405 Barco NV (Belgium American Radio Corp.) $ 68,433
118 Bekaert NV 52,235
1,180 Ciementeries CBR 105,935
1,652 Delhaize-Le Lion 153,036
1,901 Electrabel SA 681,421
24,764 Fortis "B" 914,412
781 Gevaert NV 54,093
346 Glaverbel SA 31,865
602 Groupe Bruxelles Lambert 109,845
10,390 KBC Bancassurance Holding 692,704
872 Petrofina SA 477,331
2,710 Solvay Et Cie NPV 166,193
3,150 Tractebel NPV 496,545
1,196 Union Miniere NPV 41,399
6,200 UCB SA 277,869
---------------------------------------------------------------------
Total Belgium 4,323,316
Denmark 20.9%
2,020 Bang & Olufsen Holdings 140,838
7,347 Carlsberg 297,743
75 D/S 1912 B 561,043
125 D/S Svenborg 1,198,344
8,394 Danisco A/S 384,067
8,313 Den Danske Bank Group 873,285
13,787 FLS Industries 270,352
2,911 ISS International Service System 189,193
3,729 Korn OG Foderstofkomp 73,123
878 Lauritzen Holdings 66,317
5,891 Novo Nordisk A/S 658,882
2,500 Radiometer 119,364
8,615 Tele Danmark 853,429
---------------------------------------------------------------------
Total Denmark 5,685,980
Shares Market Value
Common Stocks - continued
Germany 19.1%
1,970 Allianz $ 599,806
4,983 BASF AG 182,384
5,915 Bayer AG 221,605
3,417 Bayer Hypo-Vereinsbank 204,385
701 Beiersdorf AG 51,845
6,428 DaimlerChrysler 559,378
4,311 Deutsche Bank 221,787
17,877 Deutsche Telekom AG 728,630
4,184 Dresdner Bank 167,595
3,009 Lufthansa 65,787
3,130 Mannesmann AG 399,783
2,157 Metro AG 135,005
1,100 Muenchener Reuckver AG 219,121
300 Muenchener Rueckuer 60,570
109 Preussag 58,490
3,807 RWE AG 168,524
554 SAP AG 158,807
563 Schering AG 65,558
4,627 Siemens AG 309,232
3,240 Thyssen AG 64,016
4,093 Veba AG 215,212
239 Viag AG 131,834
2,980 Volkswagen AG 198,517
---------------------------------------------------------------------
Total Germany 5,187,871
(continued)
44
<PAGE>
North Europe Region (continued)
Shares Market Value
Common Stocks - continued
Sweden 19.6%
8,500 ABB AB Series B Shares $ 105,436
16,800 ABB AS A Shares 208,391
2,700 AGA AB Series A Shares 33,820
3,500 AGA AB Series B Shares 43,840
6,400 Astra AB B Shares 145,154
29,900 Astra AB-A 685,413
3,900 Atlas COPCO AS Series A Shares 105,764
2,000 Atlas COPKO AB SER B Shares 53,022
2,300 Diligentia AB 18,181
2,800 Drott AB SER B 24,686
9,400 Electrolux AB SER B SWKR 5 186,331
1,600 Esselte AB SER A SHS 25,684
1,600 Esselte AB SER B SHS 25,781
49,600 Ericsson LM-B Shares 1,206,372
8,800 Foreningssparbanken 207,078
1,100 Granges AB 16,588
5,200 Hennes & Mauritz AB SER B 392,071
3,300 Netcom AB-Bsh 112,368
2,100 OM Gruppen AB 26,304
4,600 Sandvika 91,743
10,400 Securitas AB SWKR2 SER B 164,417
12,800 Skandia Forsakrings AB 238,161
14,200 Skandinaviska Enskilda Bank 173,550
3,600 Skanska AB Series B Shares 122,583
2,800 SKF AB Series A Shares 39,329
3,000 SKF AB Series B Shares 42,685
1,800 SSAB Svenskt Stal AB SER A 22,547
1,100 SSAB Svenskt Stal AB SER B 13,511
6,400 Svenska Cellulosa AB SER B S 138,927
5,400 Svenska Handelsbanken-A SHS 188,143
22,200 Swedish Match AB SEK2 77,753
3,300 Trelleborg AB SER B SWKR25 31,904
7,600 Volvo AB-B 199,173
4,500 Volva 116,290
1,200 WM-Data AB-B 46,844
---------------------------------------------------------------------
Total Sweden 5,329,844
Shares Market Value
Common Stocks - continued
United Kingdom 23.3%
16,349 Allied Zurich PLC $ 220,397
8,392 Barclays PLC 241,300
16,984 BG PLC 99,809
19,367 Boots Co. PLC 207,480
40,895 BP AMOCO 697,209
13,094 British Aerospace PLC 87,519
16,349 British American Tobacco PLCa 136,198
18,089 British Sky Broadcasting PLC 155,220
33,680 British Telecommunications PLC 549,733
13,245 Cable Wireless PLC 165,509
6,600 Cadbury Schweppes PLC 95,793
15,547 CGU PLCa 242,216
13,586 Diageo PLC 152,662
18,018 Glaxo Wellcome PLCa 603,024
5,082 Granada Group PLCa 102,969
11,230 Great Universal Stores PLC 122,381
9,968 Lloyds TSB Group PLC 453,342
40,227 Marks & Spencer PLC 264,976
15,443 Prudential Corp. PLC 201,327
5,806 Rio Tinto PLC 80,566
15,737 Rueters Group PLC 231,202
7,795 Sainsbury (J) PLC 48,294
10,487 Scottish Power PLC 91,427
34,395 Smithkline Beecham PLC 496,156
66,220 Tesco PLC 175,086
26,172 Unilever PLC 243,171
3,442 Zeneca Group PLC 162,709
---------------------------------------------------------------------
Total United Kingdom 6,327,675
Total Common Stock
(Cost $26,066,370) 26,854,686
------------------------------------------------------------------
Demand Deposit 2.0%
4.797% Chase Bank Interest
Bearing Demand Deposit
(Cost $554,687) 554,687
Total Investments 101.0%
(Cost $26,621,057) 27,409,373
------------------------------------------------------------------
Other Liabilities less Assets (1.0%) (270,487)
Net Assets 100.0% $ 27,138,886
The accompanying notes are an integral part of the financial statements.
a non-income producing security.
45
<PAGE>
North Europe Region (continued)
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Summary of Investments by Industry
% of Investments
Airlines 0.20%
Alcoholic Beverage 0.61%
Animal Feed 0.30%
Automobile 3.95%
Bank 12.77%
Breweries 1.11%
Cement 0.41%
Chemicals 3.24%
Computer Services 0.61%
Construction 0.51%
Cosmetics 0.20%
Defense 0.30%
Department Stores 1.52%
Electric Materials 1.93%
Engineering 1.72%
Financial Services 0.91%
Food 2.33%
Food Retail 1.42%
Glass 0.10%
Holding 6.18%
House Equipment 0.71%
Industrial Equipment 0.91%
Industrial Gas 0.30%
Industrial Services 0.71%
Insurance 6.59%
Leisure 0.41%
Medical Equipment 0.41%
Multi-Industry 1.11%
Non Alcoholic Beverage 0.41%
Non Ferrious Metals 0.91%
Office Equipment 0.20%
Oil Integrated 4.36%
Pharmacy 10.33%
Pulp and Paper 0.51%
Real Estate 0.10%
Sea Transportation 7.09%
Services 0.91%
Specialty Retailers 1.22%
Steel Metal 0.61%
Telecommunications 13.37%
Textiles 1.42%
Tobacco 0.81%
TV and Radio 0.61%
Water Distributors 5.67%
- -----------------------------------------------------------
Total 100.00%
The accompanying notes are an integral part of the financial statements.
46
<PAGE>
South Europe Region
Performance
The ICON South Europe Region Fund (the "Fund") opened on February 20, 1997. The
Fund under-performed its benchmark, the Morgan Stanley Capital International
(MSCI) Europe 15 Index, over the period 10/1/98 to 3/31/99. The Fund's total
return for this six month period was 12.83%. The MSCI Europe 15 Index return was
15.32% for the same time period. Fund holdings in Switzerland and Italy
performed well; however, the position in Austria was a drag on portfolio
performance. The strong U.S. Dollar relative to the Euro and many other European
currencies reduced the returns to domestic investors in European markets.
Global equity markets generally posted excellent results over the last six
months. Fears of a global recession and excessive equity valuation were short
lived, as most markets quickly recovered from the July 1998 through October 1998
correction. European equities markets have resumed their upward trends.
The European continent is successfully transitioning to the Euro. Despite fears
highlighted by the financial press, the initial currency conversion was nearly
transparent. Banks and other financial institutions had spent years preparing
for the event. The only negative short term trend has been the Euro's
depreciation relative to the dollar. However, as European countries continue to
integrate and synergies are realized, the outlook for the currency could
improve.
Country Highlights
Stocks in Austria were sold during the last six months. This small position was
liquidated because it no longer fit the Advisor's discipline of owning
undervalued country markets with strong price momentum. Switzerland has remained
the largest country holding in the Fund over the last six months. Currently,
stocks in Switzerland account for approximately half of the Fund. Swiss equities
have posted excellent local market performance in the last six months; however,
the Swiss Franc has depreciated relative to the U.S. Dollar. This has hurt the
return to U.S. investors in Switzerland. The Advisor measures the Swiss equity
market to be approximately 30% undervalued.
Italian stocks have also experienced significant local market appreciation in
the last six months. Currency movements have diminished returns for U.S. based
investors, however, as the Dollar has strengthened relative to the Euro. Italian
stocks represent just over 40% of the Fund. Based on good valuations and solid
price momentum, Italian stocks are still favored by the Advisor.
Current Outlook
Based on the Advisor's discipline of investing in undervalued country markets
that show price momentum, stocks in Switzerland and Italy are compelling
investments. These countries have posted steady growth with low inflation, and
these fundamentals have led to significant stock market appreciation. Despite
their appreciation, these markets still represent compelling values to the
Advisor.
47
<PAGE>
South Europe Region
- --------------------------------------------------------------------------------
Portfolio Profile March 31, 1999 (unaudited)
Equities 94.0%
Top 10 Equity Holdings (% of Assets) 62.1%
Number of Stocks 36
Cash & Cash Equivalents 6.0%
- --------------------------------------------------------------------------------
Top 10 Equity Holdings March 31, 1999 (unaudited)
Roche Holding AG 9.9%
Novartis 9.6%
Nestle SA 7.3%
UBS AG 7.1%
Credit Suisse Group 7.0%
Ente Nazionale Idrocarburi 5.5%
IIMSPA 4.2%
Telecom Italia SPA 4.0%
Assicurazioni Generali 3.9%
Zurich Allied AG 3.6%
- --------------------------------------------------------------------------------
Top Countries March 31, 1999 (unaudited)
Switzerland 48.9%
Italy 41.5%
- --------------------------------------------------------------------------------
Investment return and principal value represent past performance and are not a
guarantee of future results. Shares may be worth more or less at redemption than
at original purchase.
The returns for the ICON Funds are since the inception of the Fund through the
dates shown. The returns are total returns, and include the reinvestment of
dividends and capital gains. International investing involves greater risk than
U.S. investments which include political, economic uncertainties and the risk of
currency fluctuations. Past performance does not guarantee future results.
The Morgan Stanley Capital International (MSCI) Europe 15 Index is comprised of
stocks traded in the developed markets of Europe. The index tries to capture at
least 60% of investable capitalization in said markets subject to constraints
governed by industry representation, maximum liquidity, maximum float, and
minimum cross-ownership (companies with exposure in multiple countries). The
index is capitalization weighted. The MSCI Europe 15 Index is an unmanaged index
that does not assume the reinvestment of dividends and does not reflect
deductions for commission, management fees and all expenses. Individuals cannot
invest in the index itself.
Performance Overview
Value of $10,000 investment since fund inception versus fund benchmark.
[Graphic Omitted]
48
<PAGE>
South Europe Region (continued)
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Shares Market Value
Common Stocks 90.4%
Italy 41.5%
7,686 Assicurasioni Generali $ 307,872
17,376 Banca Commerciale Italiana 142,580
17,727 Banco Ambrosiano Veneto 104,502
4,004 Banco Popolare Di Milano 37,308
20,980 Bennetton Group SPA 37,715
6,027 Edison SPA 55,507
67,589 Ente Nazionale Idrocarburi 430,550
56,486 Fiat SPA 186,620
9,978 Italgas (SOC Ital) 48,479
42,169 INA - Institut Naz Assicur. 127,481
12,607 Mediaset SPA 118,556
5,583 Mediobanca SPA 75,047
57,167 Montedison SPA 59,253
24,191 Parmalat Finanziaria SPA 34,476
27,664 Pirelli SPAa 78,852
2,844 Rinascente LA SPA 22,201
4,000 Riunione Adriatica Di Sicurta SPA 41,848
13,736 San Paolo IMISPA 223,199
52,815 Telecom Italia Mobile 204,143
48,967 TIM SPA 329,372
29,915 Telecom Italia SPA 317,819
45,539 Uncredito Italiano SPA 245,838
48,369 Unione Immobiliare 25,328
---------------------------------------------------------------------
Total Italy 3,254,546
Shares Market Value
Common Stocks - continued
Switzerland 48.9%
118 Adecco SA $ 59,873
90 Alusuisse-Lonza 98,993
2,945 Credit Suisse Group 549,166
40 Holderbank Financiere Glarus 44,727
315 Nestle SA 572,282
464 Novartis 752,695
64 Roche Holdings AG 780,488
155 Sairgroup 33,354
23 Schw Ruckversicherungs AG 50,892
291 SMH Neuenburg 40,403
23 Sulzer Gebuder AG 14,685
1,765 Union Bank of Switzerland AG 554,506
445 Zurich Allied AG 284,720
--------------------------------------------------------------------
Total Switzerland 3,836,784
Total Common Stocks
(Cost $7,213,820) 7,091,330
------------------------------------------------------------------
Demand Deposit 5.7%
4.797% Chase Bank Interest
Bearing Demand Deposit
(Cost $450,725) 450,725
------------------------------------------------------------------
Total Investments 96.0%
(Cost $7,664,545) 7,542,055
------------------------------------------------------------------
Assets less other Liabilities 4.0% 306,111
- --------------------------------------------------------------------------------
Net Assets 100% $ 7,848,166
The accompanying notes are an integral part of the financial statements.
a non-income producing security.
49
<PAGE>
South Europe Region (continued)
- --------------------------------------------------------------------------------
Schedule of Investments
March 31, 1999
(unaudited)
Summary of Investments by Industry
% of Investments
Airlines 0.44%
Automobile 2.64%
Bank 27.39%
Cement 0.66%
Chemicals 0.88%
Consumer Goods 0.55%
Department Stores 0.33%
Food 8.58%
Industrial Equipment 0.22%
Insurance 11.55%
Non Ferrious Metals 1.43%
Oil Integrated 6.05%
Pharmacy 21.67%
Telecommunications 11.99%
Temporary Work 0.88%
Textiles 0.55%
Tires/Rubber 1.10%
TV and Radio 1.65%
Water Distributors 1.44%
- -----------------------------------------------------------------
Total 100.00%
The accompanying notes are an integral part of the financial statements.
50
<PAGE>
ICON FUNDS
Statements of Assets & Liabilities .................................... 52
Statements of Operations .............................................. 54
Statements of Changes in Net Assets ................................... 56
Financial Highlights .................................................. 60
Notes to Financial Statements ......................................... 64
51
<PAGE>
<TABLE>
<CAPTION>
ICON FUNDS
Statements of Assets and Liabilities
As of March 31, 1999 (unaudited)
ICON Basic ICON Consumer ICON Energy ICON Financial ICON Healthcare
Materials Fund Cyclicals Fund Fund Services Fund Fund
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets
Investments at cost $11,955,190 $52,779,760 $15,382,664 $ 6,607,594 $27,826,953
---------------------------------------------------------------------------
Investments at value 9,393,743 54,280,943 10,867,858 6,876,223 31,863,051
Cash -- -- -- -- --
Receivables:
Investments sold -- 519,350 -- -- 291,469
Fund shares sold 1,088 4,991 871 653 2,611
Interest 800 2,539 1,930 1,491 1,523
Dividends 3,378 24,844 14,457 11,868 13,145
Deferred organizational expenses 12,078 12,078 -- 12,078 11,221
---------------------------------------------------------------------------
Total Assets 9,411,087 54,844,745 10,885,116 6,902,313 32,183,020
Liabilities:
Payables:
Due to Custodian bank -- -- 877 -- 1,321
Investments purchased -- -- 456,589 -- --
Fund shares redeemed 49,072 306,072 44,421 39,603 181,243
Advisory fee 8,127 46,325 7,310 6,134 27,916
Fund accounting, custodial and
transfer agent fees 2,271 12,246 2,085 1,676 7,736
Administration fee 406 2,316 365 307 1,396
Distributions due to shareholders -- -- -- -- --
Due to redeemed shareholders -- -- -- -- --
Accrued Expenses 5,767 31,994 7,495 3,882 10,574
---------------------------------------------------------------------------
Total Liabilities 65,643 398,953 519,142 51,602 230,186
Net Assets $ 9,345,444 $54,445,792 $10,365,974 $ 6,850,711 $31,952,834
Shares Outstanding (unlimited
shares authorized, no par value) 1,480,964 5,555,625 1,560,982 664,456 3,432,117
Net Asset Value (Offering price
and redemption price per share) $ 6.31 $ 9.80 $ 6.64 $ 10.31 $ 9.31
The accompanying notes are an integral part of the financial statements
52
<PAGE>
ICON ICON ICON ICON ICON ICON ICON ICON
Leisure Technology Telecomm & Transportation Short-Term Asia N. Europe S. Europe
Fund Fund Utilities Fund Fund Fixed Income Fund Region Fund Region Fund Region Fund
- --------------------------------------------------------------------------------------------------------------------
$33,129,610 $56,542,259 $ 7,484,992 $23,010,727 $ 4,079,161 $31,159,758 $26,621,057 $ 7,664,545
- --------------------------------------------------------------------------------------------------------------------
39,161,269 75,568,472 7,914,466 23,590,232 4,085,994 32,822,284 27,409,373 7,542,055
239,825 -- -- -- -- -- -- --
938,934 -- 647,282 332,025 31,223 -- 146,532 363,981
2,612 5,441 653 2,379 238 1,420 1,633 426
8,964 3,037 1,540 1,475 57,238 6,112 703 --
63,901 8,682 16,726 19,972 -- 106,335 89,841 34,535
12,078 11,220 12,078 12,078 11,221 11,221 11,221 11,221
- --------------------------------------------------------------------------------------------------------------------
40,427,583 75,596,852 8,592,745 23,958,161 4,185,914 32,947,372 27,659,303 7,952,218
-- 2,794 531,499 -- -- 523,653 170,867 2,992
-- -- -- -- -- 1,924,545 -- --
356,127 404,653 39,349 130,987 98,517 299,041 288,698 78,932
37,596 60,232 7,754 21,080 2,403 23,828 24,310 6,804
9,946 17,700 2,066 5,949 985 14,184 15,853 3,839
1,880 3,012 388 1,054 185 1,191 1,216 340
-- -- -- -- 14,117 -- -- --
-- -- -- -- 127,000 -- -- --
20,463 27,409 6,197 14,004 3,177 14,313 19,473 11,145
- --------------------------------------------------------------------------------------------------------------------
426,012 515,800 587,253 173,074 246,384 2,800,755 520,417 104,052
$40,001,571 $75,081,052 $ 8,005,492 $23,785,087 $ 3,939,530 $30,146,617 $27,138,886 $ 7,848,166
3,125,408 5,359,588 865,486 2,265,027 430,211 3,518,210 2,537,362 731,516
$ 12.80 $ 14.01 $ 9.25 $ 10.50 $ 9.16 $ 8.57 $ 10.70 $ 10.73
An Explanation of the Statement of Assets and Liabilities
This statement lists the assets and liabilities of the Funds as of the last day
of the fiscal period.
The assets may consist of the market value of the securities held in the Fund on
that day, cash, any receivables (dividends declared not paid, interest due to
the Fund but not paid, securities sold but not settled, and Fund shares
purchased by investors but not settled). The liabilities may consist of payables
for expenses incurred but not yet paid, Fund shares redeemed but not settled,
securities for the portfolio bought but not settled.
The last line is the Net Asset Value (NAV) Per Share as of the last day of the
fiscal period. The NAV per share is calculated by dividing the Funds' net assets
(assets, at that day's market value, minus liabilities) by the number of Fund
shares outstanding.
53
<PAGE>
ICON FUNDS
Statements of Operations
For the six months ended March 31, 1999 (unaudited)
ICON Basic ICON Consumer ICON Energy ICON Financial ICON Healthcare
Materials Fund Cyclicals Fund Fund Services Fund Fund
---------------------------------------------------------------------------------
Investment Income:
Interest $ 7,082 $ 22,760 $ 4,111 $ 12,578 $ 13,909
Dividends 87,545 226,954 58,691 105,417 78,596
Foreign taxes withheld (1,586) -- -- -- --
--------------------------------------------------------------------------------
Total investment income 93,041 249,714 62,802 117,995 92,505
Expenses:
Advisory fees 61,111 284,048 48,606 71,555 142,443
Fund accounting, custodial and
transfer agent fees 10,849 46,159 9,914 17,888 25,790
Administration fees 3,055 14,202 2,430 3,578 7,122
Audit fees 2,573 12,039 2,048 2,477 5,325
Registration fees 3,973 6,810 5,753 2,285 4,585
Legal fees 715 2,981 581 766 1,622
Insurance expense 377 1,766 300 437 891
Amortization of deferred
organizational expenses 1,836 1,836 -- 1,836 1,836
Trustees fees & expenses 319 1,533 132 367 777
Shareholder reports 1,612 7,545 1,283 1,365 3,529
Other expenses 955 5,507 554 988 1,462
--------------------------------------------------------------------------------
Total Expenses 87,375 384,426 71,601 103,542 195,382
--------------------------------------------------------------------------------
Net Investment income/(loss) 5,666 (134,712) (8,799) 14,453 (102,877)
--------------------------------------------------------------------------------
Net Realized and Unrealized Gain/(Loss)
on investments:
Net realized gain/(loss) from
investment transactions (934,228) (7,978,984) (2,945,843) (57,789) 1,076,400
Net realized gain/(loss) from foreign
currency transactions -- -- -- -- --
Change in net unrealized appreciation or
depreciation on securities and
foreign currency translations 1,017,848 21,258,006 3,299,592 3,052,620 1,863,626
--------------------------------------------------------------------------------
Net Realized and Unrealized Gain/(loss)
on investments: 83,620 13,279,022 353,749 2,994,831 2,940,026
--------------------------------------------------------------------------------
Net increase/(decrease) in net assets
resulting from operations $ 89,286 $ 13,144,310 $ 344,950 $ 3,009,284 $ 2,837,149
The accompanying notes are an integral part of the financial statements
54
<PAGE>
ICON ICON ICON ICON ICON ICON ICON ICON
Leisure Technology Telecomm & Transportation Short-Term Asia N. Europe S. Europe
Fund Fund Utilities Fund Fund Fixed Income Fund Region Fund Region Fund Region Fund
- -----------------------------------------------------------------------------------------------------------------------------
$ 24,721 $ 31,519 $ 18,209 $ 20,588 $ 142,469 $ 16,110 $ 20,173 $ 7,225
244,571 42,270 181,512 167,111 -- 163,592 212,698 7,115
(121) (1,286) -- -- -- (18,622) (23,196) (74)
- -----------------------------------------------------------------------------------------------------------------------------
269,171 72,503 199,721 187,699 142,469 161,080 209,675 14,266
219,433 368,491 58,462 117,491 16,603 143,377 181,060 49,900
36,230 64,165 13,064 20,480 4,930 51,720 66,376 23,581
10,972 18,424 2,923 5,874 1,277 7,169 9,053 2,495
9,295 15,652 2,016 5,001 905 6,074 7,625 2,101
5,435 6,085 5,435 5,285 5,535 5,185 5,235 5,135
2,579 4,352 689 1,418 330 1,767 2,181 576
1,363 2,296 360 734 158 891 1,119 308
1,836 1,836 1,836 1,836 1,836 1,836 1,836 1,836
1,174 2,007 303 647 134 767 958 261
5,825 9,809 1,039 3,124 676 3,806 4,781 1,317
4,049 7,127 1,601 2,638 161 3,780 1,247 825
- -----------------------------------------------------------------------------------------------------------------------------
298,191 500,244 87,728 164,528 32,545 226,372 281,471 88,335
- -----------------------------------------------------------------------------------------------------------------------------
(29,020) (427,741) 111,993 23,171 109,924 (65,292) (71,796) (74,069)
- -----------------------------------------------------------------------------------------------------------------------------
7,000,188 140,893 2,879,510 131,906 15,908 (4,349,239) 977,255 (384,264)
-- -- -- -- -- (122,267) (112,898) (22,267)
1,744,963 33,935,259 (2,088,229) 2,507,834 (41,403) 14,259,214 602,558 1,838,523
- -----------------------------------------------------------------------------------------------------------------------------
8,745,151 34,076,152 791,281 2,639,740 (25,495) 9,787,708 1,466,915 1,431,992
- -----------------------------------------------------------------------------------------------------------------------------
$ 8,716,131 $ 33,648,411 $ 903,274 $ 2,662,911 $ 84,429 $ 9,722,416 $ 1,395,119 $ 1,357,923
An Explanation of the Statements of Operations
This financial statement provides details of the Funds' income, expenses, gains
and losses on securities and currency transactions (if any) and the change in
appreciation or depreciation of portfolio holdings.
The first section, "Investment Income", reports the dividends earned from stocks
and interest earned from interest-bearing securities held by the Fund.
The next section reports the expenses incurred by the Funds, including advisory
fees, transfer agent fees, custodial fees, fund accounting fees, legal fees,
audit fees, administration fees, trustee fees and expenses, printing and postage
for mailing statements, financial reports, and prospectuses to shareholders.
The last section lists the increase and decrease in the market value of
securities held in the Funds' portfolios. A realized gain (or loss) occurs when
a Fund sells a security held in the portfolio. Unrealized gain (or loss)
represents represents the change in the market value of the securities held in
the portfolio, either appreciation or depreciation.
The net result of all these sections is the net increase (decrease) in net
assets resulting from operations.
55
<PAGE>
ICON FUNDS
Statements of Changes in Net Assets
For the periods ended as indicated
ICON Basic ICON Consumer
Materials Fund Cyclicals Fund
1999(a) 1998(b) 1999(a) 1998(b)
(unaudited) (unaudited)
------------------------------------------------------------------
Operations:
Net investment income/(loss) $ 5,666 $ 20,645 $ (134,712) $ (142,086)
Net realized gain/(loss) from
investment transactions (934,228) (10,033,591) (7,978,984) 1,433,170
Net realized gain/(loss) from
foreign currency transactions -- -- -- --
Changes in unrealized net appreciation/
depreciation on securities and foreign
currency translations 1,017,848 (6,642,816) 21,258,006 (21,598,774)
------------------------------------------------------------------
Net increase/(decrease) in net assets
resulting from operations 89,286 (16,655,762) 13,144,310 (20,307,690)
Dividends and Distributions to Shareholders from:
Net investment income (53,645) -- -- --
Net capital gains -- -- (1,483,603) --
Distributions in excess of net capital gains -- (884,415) -- --
------------------------------------------------------------------
Net decrease from dividends and distributions (53,645) (884,415) (1,483,603) --
Fund Share Transactions:
Shares sold 3,087,986 26,837,058 12,554,973 73,192,406
Reinvested dividends and distributions 53,589 884,415 1,482,251 --
Shares repurchased (11,149,715) (43,114,010) (20,254,962) (24,797,697)
------------------------------------------------------------------
Net increase (decrease) from fund share transactions (8,008,140) (15,392,537) (6,217,738) 48,394,709
Total net increase (decrease) in net Assets (7,972,499) (32,932,714) 5,442,969 28,087,019
Net Assets:
Beginning of Period 17,317,943 50,250,657 49,002,823 20,915,804
------------------------------------------------------------------
End of Period $ 9,345,444 $ 17,317,943 $ 54,445,792 $ 49,002,823
Net Assets consist of:
Paid in capital $ 22,876,942 $ 30,885,082 $ 61,250,824 $ 67,468,562
Accumulated undistributed net
investment income/(loss) (27,334) 20,645 (134,712) --
Accumulated undistributed net realized
gain/(loss) from investments (10,942,717) (10,008,489) (8,171,503) 1,291,084
Accumulated net realized gain/(loss)
from foreign currency transactions -- -- -- --
Unrealized appreciation/(depreciation) on
securities and foreign currency translations (2,561,447) (3,579,295) 1,501,183 (19,756,823)
------------------------------------------------------------------
Net Assets $ 9,345,444 $ 17,317,943 $ 54,445,792 $ 49,002,823
Transactions in Fund Shares:
Shares sold 450,889 3,238,247 1,378,345 6,769,232
Reinvested dividends and distributions 8,347 121,988 149,270 --
Shares repurchased (1,608,789) (5,338,963) (2,201,566) (2,448,362)
Net increase/(decrease) (1,149,553) (1,978,728) (673,951) 4,320,870
Shares outstanding beginning of period 2,630,517 4,609,245 6,229,576 1,908,706
Shares outstanding end of period 1,480,964 2,630,517 5,555,625 6,229,576
Purchases and Sales of Investment Securities:
(excluding Short-Term Securities)
Purchase of securities $ 3,945,137 $ 27,564,666 $ 10,815,334 $ 75,074,743
Proceeds from sales of securities 12,034,856 39,263,277 18,763,469 26,741,409
Purchases of long-term
U.S. government securities -- -- -- --
Proceeds from sales of long-term
U.S. government securities -- -- -- --
The accompanying notes are an integral part of the financial statements
(a) For the six months ended March 31, 1999
(b) For the year ended September 30, 1998
(c For the period November 5, 1997 (commencement of operations) to September 30, 1998
56
<PAGE>
ICON Energy ICON Financial ICON Healthcare ICON Leisure
Fund Services Fund Fund Fund
1999(a) 1998(c) 1999(a) 1998(b) 1999(a) 1998(b) 1999(a) 1998(b)
(unaudited) (unaudited) (unaudited) (unaudited)
- ------------------------------------------------------------------------------------------------------------------------------
$ (8,799) $ 119,672 $ 14,453 $ 97,786 $ (102,877) $ (76,391) $ (29,020) $ 53,002
(2,945,843) (1,379,407) (57,789) 2,218,332 1,076,400 11,684,946 7,000,188 5,787,424
-- -- -- -- -- -- -- --
3,299,592 (7,814,398) 3,052,620 (4,454,208) 1,863,626 (6,562,138) 1,744,963 (1,399,091)
- ------------------------------------------------------------------------------------------------------------------------------
344,950 (9,074,133) 3,009,284 (2,138,090) 2,837,149 5,046,417 8,716,131 4,441,335
(119,670) -- 86,288) (33,308) -- -- (841,466) --
-- -- (2,119,756) (104,229) (6,938,008) (5,107,561) (3,723,215) (231,012)
-- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------
(119,670) -- (2,206,044) (137,537) (6,938,008) (5,107,561) (4,564,681) (231,012)
3,442,067 49,426,596 8,580,298 14,924,224 9,977,039 35,498,828 8,167,439 31,663,895
119,106 -- 2,203,753 137,537 6,904,056 5,107,561 4,547,293 231,012
(5,755,037) (28,017,905) (21,947,114) (27,812,645) (11,980,751) (86,698,742) (31,291,032) (48,287,140)
- -------------- ------------ ------------ ------------ ------------ ------------ ------------ ------------
(2,193,864) 21,408,691 (11,163,063) (12,750,884) 4,900,344 (46,092,353) (18,576,300) (16,392,233)
(1,968,584) 12,334,558 (10,359,823) (15,026,511) 799,485 (46,153,497) (14,424,850) (12,181,910)
12,334,558 -- 17,210,534 32,237,045 31,153,349 77,306,846 54,426,421 66,608,331
- -------------- ------------ ------------ ------------ ------------ ------------ ------------ ------------
$ 10,365,974 $ 12,334,558 $ 6,850,711 $ 17,210,534 $ 31,952,834 $ 31,153,349 $ 40,001,571 $ 54,426,421
$ 19,214,827 $ 21,408,691 $ 6,644,071 $ 17,807,134 $ 24,552,248 $ 19,651,904 $ 25,842,766 $ 44,419,066
(8,797) 119,672 1,453 73,288 (102,877) -- (79,020) 791,466
(4,325,250) (1,379,407) (63,442) 2,114,103 3,467,365 9,328,973 8,206,166 4,929,193
-- -- -- -- -- -- -- --
(4,514,806) (7,814,398) 268,629 (2,783,991) 4,036,098 2,172,472 6,031,659 4,286,696
- ------------------------------------------------------------------------------------------------------------------------------
$ 10,365,974 $ 12,334,558 $ 6,850,711 $ 17,210,534 $ 31,952,834 $ 31,153,349 $ 40,001,571 $ 54,426,421
544,786 5,234,981 871,064 1,284,317 1,101,943 2,990,425 620,888 2,745,482
21,854 -- 223,731 13,658 767,971 486,896 385,038 20,626
(949,092) (3,291,547) (2,268,132) (2,528,777) (1,173,205) (7,306,493) (2,497,313) (4,018,478)
(382,452) 1,943,434 (1,173,337) (1,230,802) 696,709 (3,829,172) (1,491,387) (1,252,370)
1,943,434 -- 1,837,793 3,068,595 2,735,408 6,564,580 4,616,795 5,869,165
1,560,982 1,943,434 664,456 1,837,793 3,432,117 2,735,408 3,125,408 4,616,795
$ 456,589 $ 44,186,041 $ 5,497,159 $ 23,248,572 $ 20,124,161 $ 28,208,249 $ 15,110,810 $ 24,408,049
3,474,656 22,688,374 18,694,892 35,775,710 22,185,881 77,799,421 37,735,687 40,990,664
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
The accompanying notes are an integral part of the financial statements
An Explanation of the Statements of Changes in Net Assets
These statements report the increase or decrease in the Funds' net assets during
the reporting period. Changes in the Funds' net assets can be attributed to
investment operations (The Statement of Operations), dividends or distributions
to Fund shareholders, and purchases and sales of Fund shares. This schedule may
be used by shareholders to determine if the Funds' growth or decline was a
result of operations or an increase in the number of Fund shares being
purchased.
The first section is a summary of the Statement of Operations discussed on a
previous page.
The next section summarizes the change due to capital gain and dividend
distributions to Fund shareholders. If Fund shareholders receive their dividends
and distributions in cash, money is taken out of the Fund to make the payment.
If Fund shareholders reinvest their dividends and distributions, the Fund's net
assets will not be affected.
The net increase (decrease) in net assets from Fund share transactions includes
the increase due to purchase of Fund shares, the decrease due to Fund shares
redeemed from shareholders, and the reinvestment of Fund dividend and
distributions.
The final section "Net Assets consist of " itemizes the components of the Fund's
net assets. Since funds usually distribute substantially all earnings so as to
not incur a Fund level income tax, a significant portion of the net assets is
shareholder capital.
57
<PAGE>
ICON FUNDS
Statements of Changes in Net Assets
For the periods ended as indicated
ICON Technology ICON Telecomm & ICON Transportation
Fund Utilities Fund Fund
1999(a) 1998(b) 1999(a) 1998(b) 1999(a) 1998(b)
(unaudited) (unaudited) (unaudited)
-------------------------------------------------------------------------------------
Operations:
Net investment income/(loss) $ (427,741) $ (723,187) $ 111,993 $ 777,049 $ 23,171 $ 14,432
Net realized gain/(loss) from
investment transactions 140,893 5,250,667 2,879,510 10,444,914 131,906 1,798,699
Net realized gain/(loss) from
foreign currency transactions -- -- -- -- -- --
Changes in unrealized net appreciation/
depreciation on securities and
foreign currency translations 33,935,259 (21,889,268) (2,088,229) 1,429,447 2,507,834 (5,651,265)
-------------------------------------------------------------------------------------
Net increase/(decrease) in net assets
resulting from operations 33,648,411 (17,361,788) 903,274 12,651,410 2,662,911 (3,838,134)
Dividends and Distributions to
Shareholders from:
Net investment income -- -- (650,461) (266,587) (38,553) (11,614)
Net capital gains (4,514,600) (2,209,608) (3,257,812) (42,972) (1,845,827) (471,107)
Distribution in excess of net capital gains -- -- -- -- -- --
-------------------------------------------------------------------------------------
Net decrease from dividends and distributions (4,514,600) (2,209,608) (3,908,273) (309,559) (1,884,380) (482,721)
Fund Share Transactions:
Shares sold 22,720,892 97,384,184 5,454,226 77,148,809 16,929,587 5,477,586
Reinvested dividends and distributions 4,502,071 2,209,608 3,786,730 307,627 1,882,777 482,721
Shares repurchased (41,769,623) (61,377,016) (21,979,607) (86,471,237) (7,123,374) (12,853,191)
-------------------------------------------------------------------------------------
Net increase (decrease) from fund share
transactions (14,546,660) 38,216,776 (12,738,651) (9,014,801) 11,688,990 (6,892,884)
-------------------------------------------------------------------------------------
Total net increase (decrease) in net assets 14,587,151 18,645,380 (15,743,650) 3,327,050 12,467,521 (11,213,739)
Net Assets:
Beginning of Period 60,493,901 41,848,521 23,749,142 20,422,092 11,317,566 22,531,305
-------------------------------------------------------------------------------------
End of Period $ 75,081,052 $ 60,493,901 $ 8,005,492 $ 23,749,142 $ 23,785,087 $ 11,317,566
Net Assets consist of:
Paid in capital $ 56,394,357 $ 70,941,017 $ (2,535,165) $ 10,203,486 $ 23,131,315 $ 11,442,325
Accumulated undistributed net
investment income/(loss) (427,741) -- 44,571 583,039 (10,512) 4,870
Accumulated undistributed net realized
gain/(loss) from investments 88,223 4,461,930 10,066,612 10,444,914 84,779 1,798,700
Accumulated net realized gain/(loss)
from foreign currency transactions -- -- -- -- -- --
Unrealized appreciation/(depreciation) on
securities and foreign currency translations 19,026,213 (14,909,046) 429,474 2,517,703 579,505 (1,928,329)
-------------------------------------------------------------------------------------
Net Assets $ 5,081,052 $ 60,493,901 $ 8,005,492 $ 23,749,142 $ 23,785,087 $ 11,317,566
Transactions in Fund Shares:
Shares sold 1,777,394 8,836,734 406,687 6,461,776 1,555,663 468,177
Reinvested dividends and distributions 361,903 229,450 386,401 25,678 173,209 44,246
Shares repurchased (3,356,798) (5,717,950) (1,604,246) (6,732,956) (661,331) (1,132,684)
-------------------------------------------------------------------------------------
Net increase/(decrease) (1,217,501) 3,348,234 (811,158) (245,502) 1,067,541 (620,261)
-------------------------------------------------------------------------------------
Shares outstanding beginning of period 6,577,089 3,228,855 1,676,644 1,922,146 1,197,486 1,817,747
-------------------------------------------------------------------------------------
Shares outstanding end of period 5,359,588 6,577,089 865,486 1,676,644 2,265,027 1,197,486
Purchases and Sales of Investment Securities:
(excluding Short-Term Securities)
Purchase of securities $ -- $ 57,668,360 $ 1,287,621 $ 54,281,448 $ 14,409,718 $ 1,811,710
Proceeds from sales of securities 22,864,434 21,778,968 16,157,786 63,596,266 5,038,732 9,061,170
Purchases of long-term
U.S. government securities -- -- -- -- -- --
Proceeds from sales of long-term
U.S. government securities -- -- -- -- -- --
The accompanying notes are an integral part of the financial statements
a and b legends are at the bottom of page 56
58
<PAGE>
ICON Short-Term ICON Asia ICON N. Europe ICON S. Europe
Fixed Income Fund Region Fund Region Fund Region Fund
1999(a) 1998(b) 1999(a) 1998(b) 1999(a) 1998(b) 1999(a) 1998(b)
(unaudited) (unaudited) (unaudited) (unaudited)
- -----------------------------------------------------------------------------------------------------------------------------------
$ 109,924 $ 992,101 $ (65,292) $ (205,283) $ (71,796) $ 200,726 $ (74,069) $ (52,094)
15,908 140,283 (4,349,239) (11,335,137) 977,255 7,084,573 (384,264) 9,764,871
-- -- (122,267) (205,712) (112,898) (144,106) (22,267) (70,662)
(41,403) (110,926) 14,259,214 (10,528,930) 602,558 (3,687,785) 1,838,523 (5,229,529)
- -----------------------------------------------------------------------------------------------------------------------------------
84,429 1,021,458 9,722,416 (22,275,062) 1,395,119 3,453,408 1,357,923 4,412,586
(247,002) (865,022) -- -- (502,161) (236,890) (23,988) (113,918)
(143,769) (345,113) -- -- (3,503,483) (558,284) (1,955,771) (1,038,913)
-- -- -- -- -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
(390,771) (1,210,135) -- -- (4,005,644) (795,174) (1,979,759) (1,152,831)
9,433,196 104,764,409 19,442,673 50,431,060 16,549,010 41,024,199 9,385,991 43,453,014
412,383 1,131,298 -- -- 3,996,911 795,174 1,966,878 1,152,831
(10,949,755) (181,738,914) (25,748,141) (59,705,150) (30,522,481) (54,698,301) (12,334,523) (59,501,691)
(1,104,176) (75,843,207) (6,305,468) (9,274,090) (9,976,560) (12,878,928) (981,654) (14,895,846)
- -----------------------------------------------------------------------------------------------------------------------------------
(1,410,518) (76,031,884) 3,416,948 (31,549,152) (12,587,085) (10,220,694) (1,603,490) (11,636,091)
5,350,048 81,381,932 26,729,669 58,278,821 39,725,971 49,946,665 9,451,656 21,087,747
- -----------------------------------------------------------------------------------------------------------------------------------
$ 3,939,530 $ 5,350,048 $ 30,146,617 $ 26,729,669 $ 27,138,886 $ 39,725,971 $ 7,848,166 $ 9,451,656
$ 3,926,789 $ 5,030,965 $ 44,582,316 $ 50,887,784 $ 22,889,713 $ 32,866,273 $ 1,763,228 $ 2,744,882
(10,000) 127,078 (271,004) (205,712) (157,263) 416,694 (158,727) (60,670)
15,908 143,769 (15,483,846) (11,134,607) 3,982,862 6,509,090 6,450,714 8,790,749
-- -- (322,797) (200,530) (362,150) (249,252) (87,086) (64,819)
6,833 48,236 1,641,948 (12,617,266) 785,724 183,166 (119,963) (1,958,486)
- -----------------------------------------------------------------------------------------------------------------------------------
$ 3,939,530 $ 5,350,048 $ 30,146,617 $ 26,729,669 $ 27,138,886 $ 39,725,971 $ ,848,166 $ 9,451,656
971,096 10,667,818 2,508,531 6,402,144 1,455,093 3,234,854 749,665 3,141,567
44,404 114,918 -- -- 347,256 72,619 172,231 101,037
(1,131,951) (18,352,997) (3,381,315) (7,874,666) (2,680,832) (4,408,291) (986,877) (4,217,857)
- ------------------------------------------------------------------------------ ----------------------------------------------------
(116,451) (7,570,261) (872,784) (1,472,522) (878,483) (1,100,818) (64,981) (975,253)
- -----------------------------------------------------------------------------------------------------------------------------------
546,662 8,116,923 4,390,994 5,863,516 3,415,845 4,516,663 796,497 1,771,750
- -----------------------------------------------------------------------------------------------------------------------------------
430,211 546,662 3,518,210 4,390,994 2,537,362 3,415,845 731,516 796,497
$ -- $ -- $ 8,632,524 $ 30,912,127 $ 4,565,503 $ 27,509,067 $ 5,451,829 $ 25,142,627
-- -- 15,401,597 38,905,083 17,632,917 41,448,427 8,652,119 41,727,283
$ 2,012,760 $ 14,984,765 -- -- -- -- -- --
2,013,800 46,525,838 -- -- -- -- -- --
59
<PAGE>
ICON FUNDS
Financial Highlights
For a share outstanding throughout each of the periods ending as indicated
ICON Basic ICON Consumer
Materials Fund Cyclicals Fund
1999(a) 1998(b) 1997(d) 1999(a) 1998(b) 1997(e)
(unaudited) (unaudited)
---------------------------------------------------------------------------------------
Net asset value, beginning of period $ 6.58 $ 10.90 $ 10.00 $ 7.87 $ 10.96 $ 10.00
Income from investment operations
Net investment income (loss) 0.03 0.02 (0.01) (0.02) (0.01) (0.01)
Net gains or (losses) on securities
(both realized and unrealized) (0.27) (4.08) 0.91 2.19 (3.08) 0.97
---------------------------------------------------------------------------------------
Total from investment operations (0.24) (4.06) 0.90 2.17 (3.09) 0.96
Less dividends and distributions
Dividends (from net investment income) (0.03) -- -- -- -- --
Distributions (from net realized gain) -- (0.26) -- (0.24) -- --
---------------------------------------------------------------------------------------
Total distributions (0.03) (0.26) -- (0.24) -- --
Net asset value, end of period $ 6.31 $ 6.58 $ 10.90 $ 9.80 $ 7.87 $ 10.96
----------------------------------------------------------------------------------------
Total Return (3.63%)* (37.45%) 9.00% 27.47%* (28.26%) 9.60%
Net assets, end of period (in thousands) $ 9,345 $ 17,318 $ 50,251 $ 54,446 $ 49,003 $ 20,916
Average net assets for the period
(in thousands) $ 12,211 $ 27,117 $ 45,001 $ 56,995 $ 39,883 $ 19,876
Ratio of expenses to average net assets 1.44% 1.33% 1.45% 1.35% 1.37% 1.89%
Ratio of net investment income to
average net assets 0.05%* 0.08% (0.24%) (0.24%)* (0.36 (0.67%)
Portfolio turnover rate 32.14% 106.70% 32.35% 19.30% 72.42% 0.00%
The accompanying notes are an integral part of the financial statements
* Not annualized
a For the six months ended March 31, 1999
b For the year ended September 30, 1998
c For the period November 5, 1997 (commencement of operations) to September 30, 1998
d For the period May 5, 1997 (commencement of operations) to September 30, 1997
e For the period July 9, 1997 (commencement of operations) to September 30, 1997
f For the period July 1, 1997 (commencement of operations) to September 30, 1997
g For the period February 24, 1997 (commencement of operations) to September 30, 1997
h For the period May 9, 1997 (commencement of operations) to September 30, 1997
i For the period February 19, 1997 (commencement of operations) to September 30, 1997
j For the period July 9, 1997 (commencement of operations) to September 30, 1997
k For the period May 9, 1997 (commencement of operations) to September 30, 1997
l For the period February 7, 1997 (commencement of operations) to September 30, 1997
m For the period February 25, 1997 (commencement of operations) to September 30, 1997
n For the period February 18, 1997 (commencement of operations) to September 30, 1997
o For the period February 20, 1997 (commencement of operations) to September 30, 1997
60
<PAGE>
ICON Energy ICON Financial ICON Healthcare ICON Leisure
Fund Services Fund Fund Fund
1999(a) 1998(c) 1999(a) 1998(b) 1997(f) 1999(a) 1998(b) 1997(g) 1999(a) 1998(b) 1997(h)
(unaudited) (unaudited) (unaudited) (unaudited)
- -----------------------------------------------------------------------------------------------------------------------------------
$ 6.35 $ 10.00 $ 9.37 $ 10.51 $ 10.00 $ 11.39 $ 11.78 $ 10.00 $ 11.79 $ 11.35 $ 10.00
0.00 0.06 0.04 0.04 0.01 (0.03) 0.02 (0.04) 0.09 0.02 (0.01)
0.36 (3.71) 2.35 (1.14) 0.50 1.11 0.35 1.82 2.37 0.45 1.36
- ----------------------------------------------------------------------------------------------------------------------------------
0.36 (3.65) 2.39 (1.10) 0.51 1.08 0.37 1.78 2.46 0.47 1.35
(0.07) -- (0.06) (0.01) -- -- -- -- (0.27) -- --
-- -- (1.39) (0.03) -- (3.16) (0.76) -- (1.18) (0.03) --
- ----------------------------------------------------------------------------------------------------------------------------------
(0.07) -- (1.45) (0.04) -- (3.16) (0.76) -- (1.45) (0.03) --
$ 6.64 $ 6.35 $ 10.31 $ 9.37 $ 10.51 $ 9.31 $ 11.39 $ 11.78 $ 12.80 $ 11.79 $ 11.35
- ----------------------------------------------------------------------------------------------------------------------------------
5.91%* (36.50%) 26.21%* (10.46%) 5.10% 10.43%* 3.77% 17.80% 21.90%* 4.18% 13.50%
$10,366 $ 12,335 $ 6,851 $17,211 $32,237 $31,953 $31,153 $77,307 $40,002 $54,426 $66,608
$ 9,743 $ 21,128 $14,297 $28,304 $29,803 $28,570 $56,620 $59,164 $43,929 $74,443 $45,444
1.47% 1.20% 1.45% 1.33% 1.70% 1.37% 1.24% 1.45% 1.36% 1.30% 1.48%
(0.09%)* 0.51% 0.10%* 0.35% 0.12% (0.36%)* (0.13%) (0.80%) (0.07%)* 0.07% (0.36%)
4.69% 112.62% 39.37% 87.68% 0.00% 70.51% 52.16% 71.81% 34.24% 34.17% 2.52%
The accompanying notes are an integral part of the financial statements
An Explanation of the Financial Highlights
This schedule provides an analysis of the items that affected the Funds' net
asset value, on a per share basis. This schedule provides the total return,
distributions, assets in the Fund, expense ratios and portfolio turnover.
The first line is the beginning of period net asset value per share (NAV) and
the components of the current fiscal period's activity is shown in sections that
follow. The increase or (decrease) due to investment operations is first,
followed by gains or (losses), either realized or unrealized, then dividends and
distributions are subtracted to arrive at the NAV per share at the end of the
fiscal period.
Also included in this schedule are the Funds' expense ratios, or percentage of
net assets that was used to cover the operating expenses of the Fund during the
period. This is determined by dividing the total expenses incurred by the Fund
by the average net assets in the Fund during the year.
The next item on the schedule is the ratio of net investment income, which is
the net investment income earned from investment operations divided by the
average net assets of the Funds during the reporting period.
The next item is the portfolio turnover rate, which is a measure of the amount
of buying and selling activity in the Funds' portfolio. The turnover is affected
by many things including, market conditions, changes in the size of the Fund,
due to purchases or redemptions by shareholders, the types of Fund investments,
and the investment style of the portfolio manager. A 100% rate implies that an
amount equal to the value of the entire portfolio is turned over during the
reporting period, a 50% rate means that an amount equal to the value of half the
portfolio is traded during the reporting period.
61
<PAGE>
ICON FUNDS
Financial Highlights
For a share outstanding throughout each of the periods ending as indicated
ICON Technology ICON Telecomm & ICON Transportation
Fund Utilities Fund Fund
1999(a) 1998(b) 1997(i) 1999(a) 1998(b) 1997(j) 1999(a) 1998(b) 1997(k)
(unaudited) (unaudited) (unaudited)
-----------------------------------------------------------------------------------
Net asset value, beginning of period $ 9.20 $ 12.96 $ 10.00 $ 14.17 $ 10.63 $ 10.00 $ 9.45 $ 12.40 $ 10.00
Income from investment operations
Net investment income (loss) (0.08) (0.06) (0.05) 0.80 0.31 0.06 0.02 0.01 --
Net gains or (losses) on securities
(both realized and unrealized) 5.67 (3.31) 3.01 0.42 3.28 0.57 1.81 (2.71) 2.40
-----------------------------------------------------------------------------------------
Total from investment operations 5.59 (3.37) 2.96 1.22 3.59 0.63 1.83 (2.70) 2.40
Less dividends and distributions
Dividends (from net investment
income) -- -- -- (1.02) (0.04) -- (0.02) (0.01) --
Distributions (from net realized gain) (0.78) (0.39) -- (5.12) (0.01) -- (0.76) (0.24) --
---------------------------------------------------
Total distributions (0.78) (0.39) -- (6.14) (0.05) -- (0.78) (0.25) --
Net asset value, end of period $ 14.01 $ 9.20 $ 12.96 $ 9.25 $ 14.17 $ 10.63 $ 10.50 $ 9.45 $ 12.40
-----------------------------------------------------------------------------------------
Total Return 61.88%* (26.17%) 29.60% 6.18%* 33.88% 6.30% 19.05%* (22.08%) 24.00%
Net assets, end of period
(in thousands) $75,081 $60,494 $41,849 $ 8,005 $23,749 $20,422 $23,785 $11,318 $22,531
Average net assets for the period
(in thousands) $74,006 $73,057 $29,766 $11,639 $36,698 $19,230 $23,625 $17,975 $19,459
Ratio of expenses to average net assets 1.36% 1.31% 1.47% 1.51% 1.34% 1.91% 1.40% 1.41% 1.61%
Ratio of net investment income to
average net assets (0.57%)* (0.99%) (0.88%) 0.96%* 2.12% 1.62% 0.10%* 0.08% (0.04%)
Portfolio turnover rate 0.00% 31.68% 44.57% 11.03% 155.72% 2.55% 22.88% 10.62% 15.97%
a-o legends are at the bottom of page 60
# Includes reimbursement from administrator for fees and expenses. If these
fees and expenses had not been reimbursed, the ratio of expenses to average
net assets would have been 2.10% and the ratio of net investment income to
average net assets would have been (0.79%).
+ Includes change in accounting estimate, see note on page 66. If this change
had not been made the ratio of expenses to average net assets would have
been 0.84% and the ratio of net investment income to average net assets
would have been 4.93%.
* Not annualized
62
<PAGE>
ICON Short-Term ICON Asia ICON N. Europe ICON S. Europe
Fixed Income Fund Region Fund Region Fund Region Fund
1999(a) 1998(b) 1997(l) 1999(a) 1998(b) 1997(m) 1999(a) 1998(b) 1997(n) 1999(a) 1998(b) 1997(o)
(unaudited) (unaudited) (unaudited) (unaudited)
- --------------------------------------------------------------------------------------------------------------------------------
$ 9.79 $ 10.03 $ 10.00 $ 6.09 $ 9.94 $ 10.00 $ 11.63 $ 11.06 $ 10.00 $ 11.87 $ 11.90 $ 10.00
0.56 0.76 0.47 0.03 (0.04) (0.01) 0.02 (0.02) 0.07 0.01 (0.23) 0.10
(0.35) (0.14) 0.03 2.45 (3.81) (0.05) 0.40 0.79 0.99 1.68 0.93 1.80
- --------------------------------------------------------------------------------------------------------------------------------
0.21 0.62 0.50 2.48 (3.85) (0.06) 0.42 0.77 1.06 1.69 0.70 1.90
(0.54) (0.53) (0.47) -- -- -- (0.17) (0.06) -- (0.03) (0.07) --
(0.30) (0.33) -- -- -- -- (1.18) (0.14) -- (2.80) (0.66) --
- --------------------------------------------------------------------------------------------------------------------------------
(0.84) (0.86) (0.47) -- -- -- (1.35) (0.20) -- (2.83) (0.73) --
$ 9.16 $ 9.79 $ 10.03 $ 8.57 $ 6.09 $ 9.94 $ 10.70 $ 11.63 $ 11.06 $ 10.73 $ 11.87 $ 11.90
- --------------------------------------------------------------------------------------------------------------------------------
1.67% 6.55% 3.18% 40.72%* (38.73%) (0.60%) 2.79%* 7.00% 10.60% 12.83%* 6.11% 19.00%
$3,940 $ 5,350 $ 81,382 $30,147 $26,730 $58,279 $27,139 $39,726 $49,947 $ 7,848 $ 9,452 $21,088
$5,117 $17,542 $128,897 $28,764 $45,361 $45,191 $36,256 $49,406 $36,212 $10,012 $20,263 $15,055
1.27% 0.11%+ 1.10% 1.58% 1.65% 1.66% 1.56% 1.54% 1.66% 1.77% 1.56%# 1.69%
2.14%* 5.66%+ 4.66% (0.23%)* (0.45%) (0.23%) (0.20%)* (0.41%) 1.34% (0.74%)* (0.26%)# 1.92%
50.00% 163.75% 297.62% 30.36% 69.57% 0.00% 13.08% 57.84% 13.89% 56.92% 113.55% 7.29%
The accompanying notes are an integral part of the financial statements
An Explanation of the Financial Highlights
This schedule provides an analysis of the items that affected the Funds' net
asset value, on a per share basis. This schedule provides the total return,
distributions, assets in the Fund, expense ratios and portfolio turnover.
The first line is the beginning of period net asset value per share (NAV) and
the components of the current fiscal period's activity is shown in sections that
follow. The increase or (decrease) due to investment operations is first,
followed by gains or (losses), either realized or unrealized, then dividends and
distributions are subtracted to arrive at the NAV per share at the end of the
fiscal period.
Also included in this schedule are the Funds' expense ratios, or percentage of
net assets that was used to cover the operating expenses of the Fund during the
period. This is determined by dividing the total expenses incurred by the Fund
by the average net assets in the Fund during the year.
The next item on the schedule is the ratio of net investment income, which is
the net investment income earned from investment operations divided by the
average net assets of the Funds during the reporting period.
The next item is the portfolio turnover rate, which is a measure of the amount
of buying and selling activity in the Fund's portfolio. The turnover is affected
by many things including, market conditions, changes in the size of the Fund,
the types of Fund investments, and the investment style of the portfolio
manager. A 100% rate implies that an amount equal to the value of the entire
portfolio is turned over during the reporting period, a 50% rate means that an
amount equal to the value of half the portfolio is traded during the reporting
period.
63
<PAGE>
ICON FUNDS
Notes to Financial Statements
March 31, 1999 (unaudited)
1. Organization and Significant Accounting Policies.
The ICON Basic Materials Fund (Basic Materials Fund), ICON Consumer Cyclicals
Fund (Consumer Cyclicals Fund), ICON Energy Fund (Energy Fund), ICON Financial
Services Fund, (Financial Services Fund) ICON Healthcare Fund (Healthcare Fund),
ICON Leisure Fund (Leisure Fund), ICON Technology Fund (Technology Fund), ICON
Telecommunication & Utilities Fund (Telecommunication and Utilities Fund), ICON
Transportation Fund (Transportation Fund)-(collectively, the Domestic Funds),
and ICON North Europe Region Fund (North Europe Fund), ICON South Europe Region
Fund (South Europe Fund) and ICON Asia Region Fund (Asia Fund) (collectively,
the International Funds) and ICON Short-Term Fixed Income Fund (Short-Term Fixed
Income Fund) are series funds (collectively, the Funds) which are part of the
ICON Funds (the Trust), a Massachusetts business trust, which is registered
under the Investment Company Act of 1940, as amended (the 1940 Act), as an
open-end, non-diversified management investment company. The Trust has sixteen
funds (of which thirteen are currently in operations) which invest primarily in
securities of companies whose principal business activities fall within specific
industries or regions, and one short-term fixed income fund which invests
primarily in short-term U.S. Treasury and U.S. Government Agency instruments.
Each fund is authorized to issue an unlimited number of no par shares. The
investment objective of the domestic and international equity funds is to
provide long-term capital appreciation. The investment objective of the
Short-Term Fixed Income Fund is to attain high current income consistent with
preservation of capital.
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make certain estimates and
assumptions that affect the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of income and expenses during the reporting
period. Actual results could differ from these estimates.
Investment Valuation.
The Funds securities and other assets are valued at the close of the regular
trading session of the New York Stock Exchange (the "Exchange") (normally 4:00
p.m. New York time) each day the Exchange is open. The Portfolio's securities
and other assets are valued as follows: securities listed or traded primarily on
foreign exchanges, national exchanges and the Nasdaq Stock market are valued at
the last sale price as of the close of the Exchange, or, if such a price is
lacking for the trading period immediately preceding the time of determination,
such securities are valued at the last bid price. Securities that are traded in
the over-the-counter market are valued at the last quoted sales price or if such
a sales price is lacking a last sales price a security is valued at it's last
bid price. The market value of individual securities held by the Fund are
determined by using pricing services which provide market prices to other mutual
funds or, as needed, by obtaining market quotations from independent
broker/dealers. Securities and assets for which quotations are not readily
available are valued at fair values determined in good faith pursuant to
consistently applied procedures established by the trustees. Short-term
securities including demand notes with remaining maturities of sixty days or
less for which quotations are not readily available are valued at amortized cost
or original cost plus accrued interest, both of which approximate market value.
Repurchase Agreements.
Repurchase agreements if held by the Funds are fully collateralized by U.S.
Government securities and such collateral is in the possession of the Funds'
custodian. The collateral is evaluated daily to ensure its market value exceeds
the current market value of the repurchase agreements including accrued
interest. In the event of default on the obligation to repurchase, the Fund has
the right to liquidate the collateral and apply the proceeds in satisfaction of
the obligation. In the event of default or bankruptcy by the other party to the
agreement, realization and/or retention of the collateral or proceeds may be
subject to legal proceedings.
Foreign Currency Translation.
The accounting records of the Funds are maintained in U.S. dollars. Investment
securities and other assets and liabilities denominated in a foreign currency
are translated into U.S. dollars at the prevailing rates of exchange at period
end. Income and expenses are translated into U.S. dollars at the prevailing
exchange rate on the respective dates of the transactions. Purchases and sales
of securities are translated into U.S. dollars at the contractual currency
exchange rates established at the time of each trade. Net realized gains and
losses on foreign currency transactions represent disposition of foreign
currencies, and the difference between the amount of net investment income
accrued and the U.S. dollar amount actually received.
Income Taxes.
The Funds intend to qualify as regulated investment companies under Subchapter M
of the Internal Revenue Code and, accordingly, the Funds will not be subject to
federal and state income taxes, or federal excise taxes to the extent that they
intend to make sufficient distributions of net investment income and net
realized capital gain.
Dividends received by shareholders of the Funds which are derived from foreign
source income and foreign taxes paid by the Funds are to be treated, to the
extent allowable under the Code, as if received and paid by the shareholders of
the Funds.
64
<PAGE>
Notes to Financial Statements (continued)
Dividends paid by the Funds from net investment income and distributions of net
realized short-term gains are for federal income tax purposes, taxable as
ordinary income to shareholders.
Dividends and distributions to shareholders are recorded by the Fund on the
ex-dividend/distribution date. The Fund distributes net realized capital gains,
if any, to its shareholders at least annually, if not offset by capital loss
carryovers. Income distributions and capital gain distributions are determined
in accordance with income tax regulations which may differ from generally
accepted accounting principles. These differences are primarily due to differing
treatments for foreign currency transactions and net operating losses.
Investment Income.
Dividend income is recorded on the ex-dividend date. Non-cash dividends included
in dividend income, if any, are recorded at the fair market value of the
securities received. Interest income is accrued as earned. Certain dividends
from foreign securities will be recorded as soon as the Trust is informed of the
dividend if such information is obtained subsequent to the ex-dividend date.
Expenses.
Most expenses of the Funds can be directly attributed to each specific fund.
Expenses which cannot be directly attributed are apportioned between all funds
in the Trust.
Deferred Organizational Costs.
Organizational costs are being amortized over five years by the Funds. The
amortization starts once the Funds have assets and begin investment operations.
Investment Transactions.
Security transactions are accounted for as of trade date. Gains and losses on
securities sold are determined on the basis of identified cost.
The Funds may have elements of risk due to concentrated investments in specific
industries or in foreign issuers located in a specific country. Such
concentrations may subject the Funds to additional risks resulting from future
political or economic conditions and/or possible impositions of adverse foreign
governmental laws or currency exchange restrictions.
2. Fees and Other Transactions with Affiliates.
Investment Advisory Fees
Domestic and International Funds
As the Funds' investment advisor, Meridian Investment Management, Inc. (MIMCO)
receives a monthly fee that is computed daily at an annual rate of 1.00% of the
Domestic and International Fund's average net assets.
Short-Term Fixed Income Fund
As the fund's investment advisor, MIMCO receives a monthly fee that is computed
daily at an annual rate of .65% of the Fund's average net assets.
Transfer Agent, Custody and Accounting Fees.
Firstar Mutual Fund Services, LLC (Firstar) provides custodial services,
transfer agent services and fund accounting for the Funds. The Funds pay a fee
at an annual rate of 0.15% on the Trust's first $500 million average daily net
assets, 0.13% on the next $500 million of average daily net assets, and 0.12% on
the balance of average daily net assets. The Funds also pay for various
out-of-pocket costs incurred by Firstar that are estimated to be 0.02% of the
average daily net assets.
On behalf of the International Funds Firstar has entered into an agreement with
Chase Manhattan Bank (Chase) to provide international custodial services. The
Funds pay an annual rate of 0.112% of average daily net assets plus a per trade
transaction cost for these custodial services.
Administrative Services
The Funds have entered into an administrative services agreement with MIMCO.
This agreement provides for an annual fee of 0.05% on the Trust's first $500
million of average daily net assets and 0.04% on average daily net assets in
excess of $500 million.
Related parties
Certain officers and directors of MIMCO are also officers and trustees of the
Funds.
65
<PAGE>
Notes to Financial Statements (continued)
3. Federal Income Tax.
Net investment income distributions and capital gain distributions are
determined in accordance with income tax regulations which may differ from
generally accepted accounting principles. These differences are due to differing
treatments for items such as deferral of wash sales, foreign currency
transactions, net operating losses and capital loss carryforwards.
Net capital loss carryover expire in 2006. To the extent future capital gains
are offset by capital loss carryovers, such gains will not be distributed to
shareholders.
The aggregate cost of investments and the composition of unrealized appreciation
and depreciation of investment securities for federal income tax purposes as of
March 31, 1999, are as follows:
Fund Federal Tax Cost Unrealized Unrealized Net Appreciation Net Capital Post October
Appreciation (Depreciation) (Depreciation) Loss Carryovers Loss Deferral
- ------------------------------------------------------------------------------------------------------------------------------------
ICON Basic Materials Fund $ 11,955,190 $ 330,292 $ (2,891,727) $ (2,561,435) $ -- $ --
ICON Consumer Cyclicals Fund $ 52,906,922 $ 8,219,259 $ (6,852,467) $ 1,366,792 $ -- $ --
ICON Energy Fund $ 15,562,667 $ 101,162 $ (4,615,962) $ (4,514,800) $ -- $ --
ICON Financial Services Fund $ 69,607,597 $ 918,821 $ (650,191) $ 268,630 $ -- $ --
ICON Healthcare Fund $ 27,941,910 $ 6,342,745 $ (2,421,596) $ 3,921,149 $ -- $ --
ICON Leisure Fund $33,255,624 $ 10,065,487 $ (4,159,832) $ 5,905,655 $ -- $ --
ICON Technology Fund $ 56,542,270 $ 27,659,290 $ (8,633,064) $ 19,026,226 $ -- $ --
ICON Telecommunication and
Utilities Fund $ 7,484,989 $ 875,283 $ (445,798) $ 429,485 $ -- $ --
ICON Transportation Fund $ 23,091,571 $ 2,647,495 $ (2,148,821) $ 498,674 $ -- $ --
ICON Short-Term
Fixed Income Fund $ 4,079,161 $ 11,722 $ (4,889) $ 6,833 $ -- $ --
ICON Asia Region Fund $ 31,458,228 $ 4,170,996 $ (2,508,459) $ 1,662,537 $ 9,312 $ 8,215,385
ICON North Europe Region Fund $ 26,597,131 $ 3,340,188 $ (2,551,867) $ 788,321 $ -- $ 122,266
ICON South Europe Region Fund $ 7,658,474 $ 400,117 $ (522,609) $ (122,492) $ -- $ 60,669
</TABLE>
4. Malaysian Securities
Effective September 1, 1998, the Government of Malaysia imposed currency
controls on the Malaysian ringgit. Among other things, these controls
effectively prohibit the Asia Region Fund from repatriating any capital invested
in Malaysian securities without incurring a redemption tax unless the security
being sold has been held for more than one year. The holding period begins
accruing on the later of September 1, 1998 or the date on which the security is
purchased. Therefore, Malaysia's new currency controls effectively would
prohibit the Asia Region Fund from repatriating any capital invested in Malaysia
without incurring the tax until September 1, 1999 at the earliest. Due to these
restrictions the investments in Malaysia have been valued at fair value using a
20% discount (the tax rate) as of March 31, 1999.
As of March 31, 1999, approximately 4.5% of the Asia Region Fund's assets were
invested in Malaysian securities.
5. Accounting Estimates
The ICON Short-Term Fixed Income Fund had a net overaccrual of expenses of
approximately $157,000 as of September 30, 1997 which was not material to the
financial statements as of that date. However due to the substantial decrease in
the net assets of the Fund during the year ended September 30, 1998 the net
overaccrual of $127,000 became material to the financial statements of the Fund.
The Fund has determined that it received a net benefit due to this overaccrual
and will identify and reimburse shareholders who provided this benefit. The
amount of this benefit is identified as due to redeemed shareholders in the
statement of assets and liabilities.
The ICON South Europe Region Fund underaccrued foreign custodial and transaction
costs for the year ended September 30, 1998. The administrator has agreed to
reimburse the fund $109,000 for this underaccrual. This is included in the
statement of operations as fees and expenses reimbursed.
Both of these transactions have been accounted for as a change in accounting
estimate and adjusted for as of September 30, 1998.
66
<PAGE>
ICON FUNDS
1999 Semi-Annual Report
This space is available for your notes
Design: Davis Design, Denver
Printing: Tewell Warren Printing, Denver
67
