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SCIOTO INVESTMENT COMPANY, C/O 4561 LANES END ST., COLUMBUS, OHIO 43220
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TO THE BOARD OF DIRECTORS AND SHAREHOLDERS:
The accompanying Scioto Investment Company unaudited condensed
financial statements for the six month periods ended June 30, 1997, 1996 and
1995 have been compiled by management in accordance with the instructions for
interim financial reporting of the Securities and Exchange Commission and do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements.
These compilations should be read in conjunction with the Company's
annual audited financial statements and the notes thereto included in the
previously released Annual Reports to shareholders and the Securities and
Exchange Commission for the years ended December 31, 1996, 1995 and 1994.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation of the
financial information have been included herein. A schedule of the portfolio
positions as of June 30, 1997 and a summary of the Annual Meeting of
Shareholders are included herewith. A schedule of investments as of December 31,
1996 was included in the Company's Annual Report for 1996.
Respectfully submitted,
SCIOTO INVESTMENT COMPANY
Stephen Kellough, Chairman and President
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SCIOTO INVESTMENT COMPANY, C/O 4561 LANES END ST., COLUMBUS, OHIO 43220
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UNAUDITED CONDENSED STATEMENTS OF ASSETS AND LIABILITIES
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<TABLE>
<CAPTION>
JUNE 30
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1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
ASSETS:
Investments in tax exempt bonds at
quoted marked values (amortized cost:
1997, $7,468,901; 1996, $6,711,366;
1995, $7,140,106 ......................... $7,468,729 $6,699,363 $7,168,547
Cash and cash equivalents ................... 102,663 1,143,955 446,992
Accrued interest receivable ................. 46,094 37,489 47,424
Prepaid expenses ............................ 283 283 283
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TOTAL ASSETS ..................................... 7,617,769 7,881,090 7,663,246
LIABILITIES:
Payable for investment purchased ............ 0 260,343 0
Accrued professional, directors' and transfer
agent fees .................................. 18,921 19,913 37,430
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NET ASSETS (net asset value per common
share, based upon 447,950 common
shares outstanding: 1997, $16.96;
1996, $16.97; 1995, $17.02 .................. $7,598,848 $7,600,834 $7,625,816
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</TABLE>
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SCIOTO INVESTMENT COMPANY, C/O 4561 LANES END ST., COLUMBUS, OHIO 43220
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UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
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<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED JUNE 30
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1997 1996 1995
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<S> <C> <C> <C>
INVESTMENT INCOME - Nontaxable inter-
est income, net of bond premium
amortization and discount accretion
of $14,439 in 1997; $10,957 in 1996;
and $21,999 in 1995 ................................. $ 156,841 $ 160,057 $ 166,862
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OPERATING EXPENSES:
Professional services ............................... 34,551 29,731 31,381
Directors' fees ..................................... 4,500 4,500 4,000
Other expenses ...................................... 3,122 6,121 4,953
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TOTAL OPERATING EXPENSES ................................. 42,173 40,352 40,334
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NET INVESTMENT INCOME .................................... 114,668 119,705 126,528
NET GAIN (LOSS) ON INVESTMENTS:
Unrealized appreciation (depreciation of
investment .......................................... (20,856) (55,165) 52,592
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NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ................................ $ 93,812 $ 64,540 $ 179,120
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</TABLE>
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SCIOTO INVESTMENT COMPANY, C/O 4561 LANES END ST., COLUMBUS, OHIO 43220
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UNAUDITED CONDENSED STATEMENTS OF CHANGES IN NET ASSETS
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<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED JUNE 30
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1997 1996 1995
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<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
RESULTING FROM OPERATIONS
Net investment income ............... $ 114,668 $ 19,705 $ 126,528
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Unrealized appreciation (depreciation
of investments ...................... (20,856) (55,165) 52,592
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NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ................ 93,812 64,540 179,120
DIVIDENDS TO SHAREHOLDERS FROM
NET INVESTMENT INCOME .................. 125,426 116,467 134,385
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NET INCREASE (DECREASE) IN
NET ASSETS ............................. (31,614) (51,927) 44,735
NET ASSETS, BEGINNING OF PERIOD .......... 7,630,462 7,652,761 7,581,081
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NET ASSETS, END OF PERIOD, including
undistributed net investment income of
$174,414, $188,385, and $171,543
respectively ........................... $ 7,598,848 $ 7,600,834 $ 7,625,816
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</TABLE>
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THE OHIO COMPANY
ACCOUNT STATEMENT FOR
SCIOTO INVESTMENT CO.
PERIOD ENDING JUNE 30, 1997
<TABLE>
<CAPTION>
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PORTFOLIO POSITIONS
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NON-TAXABLE INVESTMENTS
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SYMBOL CURRENT EST
OR MARKET MARKET YIELD ANNUAL
QUANTITY DESCRIPTION CUSIP PRICE VALUE (%) INCOME
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MUNICIPAL BONDS AND NOTES
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
150,000 BELMONT CO OHIO VAR PURP 3.55% 12/01/97 080257-DL-9 99.869 149,804 3.55 5,325
150,000 BLUE ASH OHIO LTGO-RD IMPT 4.45% 11/01/97 095239-FR-5 100.242 150,363 4.44 6,675
115,000 CANTON OH WTRWKS SYS IMPT 5.00% 12/01/98 138429-FA-8 101.332 116,532 4.93 5,750
300,000 CLERMONT CO OH HOSP FACS-B 4.85% 09/01/00 185705-EE-6 101.198 303,594 4.79 14,550
300,000 COLUMBUS OHIO RFDG-C B/E/0 4.55% 09/15/99 199489-Y6-6 100.813 302,439 4.51 13,650
300,000 COLUMBUS OH CSD RFDG B/E 4.45% 12/01/98 199507-UJ-1 100.576 301,728 4.42 13,350
300,000 CUYAHOGA CO OHIO LTGO B/E 4.10% 11/15/98 232237-5C-7 100.170 300,510 4.09 12,300
250,000 DELAWARE CO OHIO LTGO B/E 4.45% 12/01/97 245869-AG-7 100.228 250,570 4.44 11.125
200,000 DUBLIN OH LSD UT 7 1/8% 12/01/00 263715-EH-3 108.519 217,038 6.57 14,250
500,00 DUBLIN OH CSD UT GO BDS 4.65% 12/01/97 26371G-BB-5 100.334 501,670 4.63 23,250
150,000 DUBLIN OH CSD UT GO BDS 5 1/4% 12/01/00 26371G-BB-9 102.772 154,158 5.11 7,875
100,000 FLAT ROK MICH. I.D.R. 5 3/8% 09/01/97 338647-AQ-3 100.214 100,214 5.36 5,375
100,000 GRANDVIEW HTS OH CSD BED 7 1/2% 12/01/97 386694-BM-4 101.516 101,516 7.39 7,500
125,000 HAMILTON CO OHIO SWR SYS-A 6.40% 12/01/05 407288-HS-1 108.791 135,989 5.88 8,000
400,000 HILLIARD OH CSD SER A B/E 3.90% 12/01/98 431621-EJ-6 99.888 399,552 3.90 15,600
300,000 HILLIARD OH CSD SER A B/E 4.00% 12/01/99 431621-EK-3 99.517 298,551 4.02 12,000
160,000 LUCAS CO. OH. IMP. REV. BD 5 5 1/4% 02/01/98 549307-AA-4 100.145 160,232 5.24 8,400
100,000 MARIETTA OHIO WATER REV 4.30% 12/01/98 567796-AB-3 100.397 100,397 4.28 4,300
200,000 MONTGOMERY CNTY OHIO 5.30% 12/01/98 613478-CE-4 101.703 203,406 5.21 10,600
100,000 MONTGOMERY CO OH WASTE B/E 4.10% 11/01/98 613551-AC-4 100.087 100,087 4.10 4,100
100,000 NAPOLEON OHIO CSD B/E/O 4.15% 12/01/00 630684-CP-1 99.713 99,713 4.16 4,150
700,000 OH ST FACS VERN RIFFE - A 4% 10/01/98 67755A-CV-3 100.105 700,735 4.00 28,000
400,000 OHIO ST HIGHER ED SER II-A 5.30% 12/01/97 677597-GG-5 100.608 402,432 5.27 21,200
150,000 OTTAWA COUNTY OHIO 4.70% 12/01/97 689235-HN-1 100.333 150,500 4.68 7,050
300,000 SPRINGBORO CMNTY CSD OHIO 3.80% 12/01/98 85022K-AV-2 99.681 299,043 3.81 11,400
250,000 SPRINGFIELD OH LSD IMPT UT 6 1/8% 12/01/98 851188-DH-2 103.091 257,728 5.94 15,313
200,000 TOLEDO OHIO WTRWKS REV B/E 4 1/4% 11/15/98 889396-HD-2 100.170 200,340 4.24 8,500
600,000 UPPER ARLINGTON OH CSD 3.80% 12/01/98 915506-HQ-5 99.681 598,086 3.81 22,800
200,000 WESTERVILLE OHIO CSD 4 1/4% 12/01/98 960028-JS-8 100.328 200,656 4.24 8,500
200,000 YOUNGSTONW OHIO IMPT 7.00% 12/01/99 987643-QZ-9 105.573 211,146 6.63 14,000
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TOTAL $7,468.729 $344,888
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TOTAL NON-TAXABLE INVESTMENTS $7,468,729 $344,888
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</TABLE>
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SUMMARY OF ANNUAL MEETING OF SHAREHOLDERS
The Company held its 1997 Annual Meeting of Shareholders June 11, 1997. At
the meeting, shareholders present, in person and by proxy, were as follows: of
the 108,800 Class A common shares outstanding (one vote per share), a total of
83,559 were represented; and of the 339,150 Class B common shares outstanding
(ten votes per share) all 339,150 were represented; therefore, 422,709 of the
common shares representing approximately 99.3% of the total voting power of the
Company were represented at the meeting.
A resolution fixing the number of Directors at six passed with 3,474,699
votes FOR the resolution, 250 votes AGAINST, and 110 votes ABSTAINING.
The following persons were elected as members of the Company's Board of
Directors to serve until the annual meeting following their election or until
their successors are duly elected and qualified. Each person received the number
of votes for or the number of votes with authority withheld indicated below.
<TABLE>
<CAPTION>
Name Votes For Votes Withheld
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<S> <C> <C>
Stephen Kellough 3,475,059 0
Marilyn Brown Kellough 3,475,059 0
Donald C. Fanta 3,475,059 0
Arthur D. Herrmann 3,475,059 0
Brooks P. Julian 3,475,059 0
John Josephson 3,475,059 0
Kent K. Rinker 3,475,059 0
</TABLE>
A resolution to ratify the selection of Deloitte & Touche LLP as
independent accountants for the Company for the 1997 fiscal year passed with
3,474,809 votes FOR, 250 votes AGAINST, and no votes to ABSTAIN.
6
