================================================================================
FIRST QUARTER REPORT
SELIGMAN
COMMON STOCK
FUND, INC.
================================================================================
March 31, 1996
[Logo]
- --------------------------------------------------------------------------------
A GROWTH AND INCOME FUND
ESTABLISHED IN 1930
SELIGMAN FINANCIAL SERVICES, INC.
an affiliate of
[LOGO]
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
100 Park Avenue, New York, NY 10017
THIS REPORT IS INTENDED ONLY FOR THE INFORMATION OF SHAREHOLDERS OR THOSE WHO
HAVE RECEIVED THE OFFERING PROSPECTUS COVERING SHARES OF CAPITAL STOCK OF
SELIGMAN COMMON STOCK FUND, INC., WHICH CONTAINS INFORMATION ABOUT THE SALES
CHARGES, MANAGEMENT FEE, AND OTHER COSTS. PLEASE READ THE PROSPECTUS CAREFULLY
BEFORE INVESTING OR SENDING MONEY.
EQCS3a 3/96
<PAGE>
================================================================================
TO THE SHAREHOLDERS
- --------------------------------------------------------------------------------
Seligman Common Stock Fund performed favorably in the first quarter of 1996, in
line with the Standard & Poor's 500 Composite Stock Price Index, as it continued
to successfully produce favorable income and long-term growth without exposing
capital to undue risk. For long-term performance information, please refer to
the table on page 6.
Your Fund's dividend and gain information at March 31, 1996, is as follows: On
March 27, an $0.08 per share dividend was paid to Class A shareholders of record
March 21, and a $0.057 dividend was paid to Class D shareholders of record March
21. For both Class A and D shares, net realized gain from investment
transactions for the three months totaled $0.42 per share. At March 31, net
unrealized gain totaled $3.91 per share.
The first quarter was one in which the US economy demonstrated its resilience.
Despite a strike at General Motors that spread to manufacturing plants and
companies across the nation, failure of both the Congress and Administration to
reach a budget agreement, disappointment that the Federal Reserve Board did not
continue to reduce short-term interest rates, and a rise in long-term interest
rates, the US economy continued to grow at a moderate rate.
Capital spending, which had been the strongest sector of the economy, slowed
dramatically during the first quarter. The relationship between new orders and
current shipments in the bellwether semiconductor industry, for example, hit a
nine-year low in March, while consumer cyclicals rebounded by the end of the
quarter, with retail sales advancing at an 8.2% annual rate. Personal income
continued to post solid advances, as employment growth remained on track.
Although there has been a sudden rise in energy and grain prices, which bears
monitoring, the financial markets' quick response to any sign of increased
inflation imparts its own kind of discipline on US policymakers and the Fed.
Therefore, we anticipate that the balance of 1996 will be more noteworthy for
the political debate inherent to a presidential election year than any dramatic
change in the direction of the economy.
During the quarter, the economy's resilience and improved outlook benefited
the performance of your Fund's large-capitalization holdings. Economically
sensitive issues, such as retailers, performed particularly well, allowing your
Portfolio Manager to take profits and decrease the portfolio's exposure to this
area. In addition, because your Manager reduced the portfolio's exposure to
consumer staples in late 1995, your Fund was not overly impacted by this
sector's weak performance in the first quarter. Your portfolio's financial
holdings also underperformed in the first quarter in response to increasing
long-term interest rates.
For more information about your Fund, or your investment in its shares, please
write, or call Shareholder Services using the toll-free telephone numbers listed
below.
By order of the Board of Directors,
/s/ William C. Morris
William C. Morris
Chairman
/s/ Brian T. Zino
Brian T. Zino
President
April 26, 1996
- --------------------------------------------------------------------------------
Important Telephone Numbers
- ---------------------------
SHAREHOLDER RETIREMENT PLAN 24-HOUR AUTOMATED
SERVICES SERVICES TELEPHONE ACCESS SERVICE
(800) 221-2450 (800) 445-1777 (800) 622-4597
1
<PAGE>
================================================================================
PORTFOLIO OF INVESTMENTS (unaudited) March 31, 1996
- --------------------------------------------------------------------------------
SHARES VALUE
------ -----
COMMON STOCKS 85.0%
ADVERTISING 1.3%
Omnicom Group ............................. 200,000 $ 9,000,000
------------
AEROSPACE/DEFENSE 1.7%
General Motors (Class H) .................. 75,000 4,743,750
United Technologies ....................... 60,000 6,735,000
------------
11,478,750
------------
APPAREL AND TEXTILES 1.4%
Liz Claiborne ............................. 150,000 5,137,500
Unifi ..................................... 175,000 4,309,375
------------
9,446,875
------------
AUTOMOTIVE AND RELATED 1.6%
Autoliv (ADRs)*+ .......................... 20,000 1,030,000
Echlin .................................... 150,000 5,437,500
Genuine Parts ............................. 100,000 4,500,000
------------
10,967,500
------------
CHEMICALS 2.8%
Bayer AG .................................. 7,600 2,575,704
Crompton & Knowles ........................ 200,000 2,925,000
Dow Chemical .............................. 100,000 8,687,500
European Vinyls ........................... 45,300 1,576,439
Olin ...................................... 40,000 3,480,000
------------
19,244,643
------------
CONSTRUCTION 0.6%
Sherwin-Williams .......................... 100,000 4,437,500
------------
CONSUMER GOODS AND SERVICES 8.3%
Adidas AG ................................. 13,646 1,007,187
Allied Domecq ............................. 230,000 1,723,594
Christian Dior--ABSA ...................... 10,000 1,332,539
Coca-Cola ................................. 75,000 6,196,875
Colgate-Palmolive ......................... 125,000 9,734,375
Eastman Kodak ............................. 100,000 7,100,000
Gillette .................................. 50,000 2,587,500
International Flavors & Fragrances ........ 100,000 4,787,500
PepsiCo ................................... 150,000 9,487,500
Procter & Gamble .......................... 100,000 8,475,000
Rubbermaid ................................ 185,000 5,249,375
------------
57,681,445
------------
DRUGS AND HEALTH CARE 4.8%
Abbott Laboratories ....................... 75,000 3,056,250
American Home Products .................... 30,000 3,251,250
Bard (C.R.) ............................... 150,000 5,343,750
Bausch & Lomb ............................. 100,000 3,700,000
Bristol-Myers Squibb ...................... 40,000 3,425,000
Genzyme* .................................. 37,826 2,089,887
Genzyme Tissue Repair ..................... 5,106 83,611
Mallinckrodt Group ........................ 100,000 3,762,500
Schering-Plough ........................... 150,000 8,718,750
------------
33,430,998
------------
ELECTRIC AND GAS UTILITIES 6.4%
British Gas (ADRs) ........................ 30,000 1,027,500
Carolina Power and Light .................. 200,000 7,450,000
Central & South West ...................... 200,000 5,700,000
Edison International ...................... 200,000 3,425,000
Empresa Nacional de Electricidad (ADRs) ... 50,000 2,850,000
FPL Group ................................. 160,000 7,240,000
Hong Kong Electric ........................ 1,800,000 5,852,845
Southern Company .......................... 150,000 3,581,250
VEBA AG ................................... 45,000 2,187,229
Williams Cos .............................. 100,000 5,037,500
------------
44,351,324
------------
ELECTRONICS 0.8%
Motorola .................................. 100,000 5,300,000
------------
ENERGY 7.7%
Anadarko Petroleum ........................ 100,000 5,550,000
Atlantic Richfield ........................ 50,000 5,950,000
Enron ..................................... 150,000 5,531,250
Mobil ..................................... 50,000 5,793,750
Panhandle Eastern ......................... 200,000 6,225,000
Royal Dutch Petroleum ..................... 65,000 9,181,250
Schlumberger .............................. 100,000 7,912,500
Texaco .................................... 70,000 6,020,000
Total S.A. (Class B) ...................... 15,000 1,012,809
------------
53,176,559
------------
ENVIRONMENTAL SERVICES 0.5%
Browning-Ferris Industries .................. 100,000 3,150,000
------------
FINANCE AND INSURANCE 12.9%
Ahmanson (H.F.) ............................. 150,000 3,637,500
American International Group ................ 100,000 9,362,500
AON ......................................... 100,000 5,175,000
AXA ......................................... 20,000 1,229,272
Banco de Santander (ADSs) ................... 50,000 2,380,089
Bank of New York ............................ 150,000 7,725,000
Bankers Trust ............................... 100,000 7,087,500
Citicorp .................................... 50,000 4,000,012
CoreStates Financial ........................ 150,000 6,356,250
Federal National Mortgage Association ....... 200,000 6,375,000
General Re .................................. 50,000 7,287,500
Great Western Financial ..................... 150,000 3,618,750
Grupo Financiero Banamex Accival (Class B) .. 551,000 1,177,419
2
<PAGE>
================================================================================
- --------------------------------------------------------------------------------
SHARES VALUE
------ -----
Household International ..................... 50,000 $ 3,362,500
HSBC Holdings ............................... 50,000 749,868
Internationale Nederlanden Groep ............ 38,950 2,828,785
MBNA ........................................ 100,000 2,962,500
Morgan (J.P.) ............................... 90,000 7,470,000
National Australia Bank (ADRs) .............. 50,000 2,237,500
St. Paul Companies .......................... 60,000 3,330,000
Societe Generale ............................ 9,040 1,005,342
------------
89,358,287
------------
FOOD 4.8%
Campbell Soup ............................... 100,000 6,087,500
ConAgra ..................................... 150,000 6,093,750
CPC International ........................... 100,000 6,937,500
General Mills ............................... 100,000 5,837,500
Sara Lee .................................... 250,000 8,156,250
------------
33,112,500
------------
INDUSTRIAL EQUIPMENT 3.5%
BTR ......................................... 320,000 1,540,902
Cooper Industries ........................... 75,000 2,925,000
Emerson Electric ............................ 50,000 4,037,500
General Electric ............................ 150,000 11,681,250
Mannesmann .................................. 4,000 1,461,267
Pacific Dunlop .............................. 1,100,000 2,600,628
------------
24,246,547
------------
LEISURE ENTERTAINMENT 0.2%
Mandarin Oriental ........................... 300,000 378,000
Television Broadcast ........................ 300,000 1,103,469
------------
1,481,469
------------
OFFICE EQUIPMENT 1.1%
Pitney Bowes ................................ 150,000 7,350,000
------------
PAPER AND PACKAGING 1.9%
International Paper ......................... 175,000 6,890,625
Kimberly-Clark .............................. 75,000 5,587,500
Stora Kopparbergs (Class B) ................. 80,000 1,024,136
------------
13,502,261
------------
PRINTING AND PUBLISHING 2.9%
Donnelley (R.R.) ............................ 100,000 3,450,000
Knight-Ridder Newspapers .................... 100,000 6,812,500
Reader's Digest (Class A) ................... 100,000 4,725,000
Reed Elsevier ............................... 130,000 1,990,559
Tribune ..................................... 50,000 3,293,750
------------
20,271,809
------------
RESTAURANT 0.3%
Wendy's International ....................... 120,000 2,175,000
------------
RETAIL TRADE 5.1%
American Stores ............................. 200,000 6,600,000
Dillard Department Stores ................... 100,000 3,462,500
Kmart ....................................... 300,000 2,812,500
Limited ..................................... 81,585 1,550,115
May Department Stores ....................... 100,000 4,825,000
NORDSTROM ................................... 75,000 3,632,813
Sears, Roebuck .............................. 100,000 4,875,000
Wal-Mart .................................... 200,000 4,625,000
Woolworth ................................... 175,000 2,734,375
------------
35,117,303
------------
STEEL 0.6%
Nucor ....................................... 60,000 3,547,500
Pohang Iron & Steel (ADRs) .................. 40,000 970,000
------------
4,517,500
------------
TECHNOLOGY 0.1%
Olivetti .................................... 1,700,000 873,046
------------
TELECOMMUNICATIONS 2.0%
Alcatel Alsthom ............................. 17,000 1,576,268
American Telephone & Telegraph .............. 75,000 4,593,750
Frontier .................................... 150,000 4,725,000
Indosat (ADRs) .............................. 13,100 447,037
Tele Danmark (ADSs) ......................... 70,000 1,811,250
Telecom Italia-Di Risp ...................... 585,000 644,900
------------
13,798,205
------------
TELEPHONE UTILITIES 3.3%
ALLTEL ...................................... 250,000 7,750,000
NYNEX ....................................... 150,000 7,481,250
SBC Communications .......................... 75,000 3,946,875
U.S. West ................................... 115,000 3,723,125
------------
22,901,250
------------
TOBACCO 3.0%
B.A.T. Industries ........................... 200,000 1,475,884
Philip Morris ............................... 75,000 6,581,250
Schweitzer-Mauduit International ............ 245,000 6,737,500
UST Inc. .................................... 200,000 6,375,000
------------
21,169,634
------------
TRANSPORTATION 1.6%
British Airways (ADRS) ...................... 21,000 1,674,750
Caliber Systems ............................. 108,400 4,647,650
Conrail ..................................... 50,000 3,581,250
Jurong Shipyard ............................. 150,000 888,928
------------
10,792,578
------------
MISCELLANEOUS/DIVERSIFIED 3.8%
Corning (Delaware) .......................... 200,000 7,000,000
Dover ....................................... 50,000 2,287,500
General Signal .............................. 200,000 7,250,000
3
<PAGE>
================================================================================
- --------------------------------------------------------------------------------
SHARES OR
PRIN. AMT. VALUE
---------- -----
MISCELLANEOUS/DIVERSIFIED 3.8% (continued)
Minnesota Mining & Manufacturing ............ 50,000 shs. $ 3,243,750
Tenneco ..................................... 119,500 6,677,063
------------
26,458,313
------------
TOTAL COMMON STOCKS
(Cost $412,117,047) ...................... 588,791,296
------------
CONVERTIBLE BONDS 6.8%
AUTOMOTIVE AND RELATED 0.4%
Exide 2.90%, 12/15/2005 ..................... $4,500,000 2,660,625
------------
INSURANCE 0.3%
Finance One 2%, 8/31/2001 ................... 750,000 787,500
Liblife International
61/2%, 9/30/2004 ......................... 1,000,000 1,347,500
------------
2,135,000
------------
LEISURE AND RELATED 0.3%
Bell Sports 41/4%, 11/15/2000 ............... 2,500,000 1,706,250
------------
RETAIL TRADE 1.3%
Big B 61/2%, 3/15/2003 ...................... 2,000,000 1,975,000
The Pep Boys 4%, 9/1/2001 ................... 5,000,000 5,075,000
Price 63/4%, 3/1/2001 ....................... 2,000,000 2,037,500
------------
9,087,500
------------
TECHNOLOGY 1.8%
Bay Networks 51/4%, 5/15/2003+ .............. 3,500,000 3,535,000
Conner Peripherals 61/2%, 3/1/2002 2,000,000 2,242,500
Data General 73/4%, 6/1/2001 ................ 3,000,000 3,075,000
EMC 41/4%, 1/1/2001 ......................... 3,000,000 3,570,000
------------
12,422,500
------------
TRANSPORTATION .2%
Nippon Yusen 2%, 9/29/2000 .................. 140,000,000** 1,554,902
------------
MISCELLANEOUS/DIVERSIFIED 2.5%
MascoTech 41/2%, 12/15/2003 ................. $3,000,000 2,343,750
Teco Electric & Machinery 23/4%,
4/15/2004 ................................ 1,500,000 1,246,875
Thermo Electron 5%, 4/15/2001+ .............. 3,000,000 5,928,750
TNT Pacific Finance 9%, 7/27/1998 ........... 5,000,000++ 3,833,519
TriMas 5%, 8/1/2003 ......................... 2,000,000 2,170,000
Xilinx 51/4%, 11/1/2002+ .................... 2,000,000 1,850,000
-----------
17,372,894
------------
TOTAL CONVERTIBLE BONDS
(Cost $41,338,944) ....................... 46,939,671
------------
SHARES OR
PRIN. AMT. VALUE
---------- -----
CONVERTIBLE PREFERRED STOCKS 2.1%
INSURANCE 0.6%
Alexander & Alexander
(Series A) $3.625+ ....................... 100,000 shs. $ 4,712,500
------------
PAPER 0.3%
International Paper $4.00+ .................. 40,000 1,870,000
------------
TELECOMMUNICATIONS 0.3%
Mobile Telecommunications Technology $2.25+ . 75,000 1,987,500
------------
TRANSPORTATION 0.9%
GATX $3.875 ................................. 70,000 3,946,250
Sea Containers $4.00 ........................ 50,000 2,287,500
------------
6,233,750
------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(COST $14,344,496) ....................... 14,803,750
-----------
SHORT-TERM HOLDINGS 5.7%
ABN-AMRO Bank, Grand Cayman,
Fixed Time Deposit,
57/16%, 4/1/1996 ......................... $19,500,000 19,500,000
Republic National Bank of New York,
Grand Cayman, Fixed Time Deposit,
51/2%, 4/1/1996 .......................... 20,000,000 20,000,000
------------
TOTAL SHORT-TERM HOLDINGS
(Cost $39,500,000) ....................... 39,500,000
------------
TOTAL INVESTMENTS 99.6%
(Cost $507,300,487)....................... 690,034,717
OTHER ASSETS LESS LIABILITIES 0.4% ......... 2,982,482
------------
NET ASSETS 100.0% .......................... $693,017,199
============
* Non-income producing security.
+ Rule 144A Security.
** Principal amount reported in Japanese yen.
++ Principal amount reported in Australian dollars.
Note: Investments in common stocks and convertible securities are valued at
current market values or, in their absence, at fair values determined in
accordance with procedures approved by the Board of Directors. Securities traded
on national exchanges are valued at last sales prices or, in their absence and
in the case of over-the-counter securities, a mean of bid and asked prices.
Short-term holdings maturing in 60 days or less are valued at amortized cost.
4
<PAGE>
================================================================================
- --------------------------------------------------------------------------------
LARGEST PORTFOLIO CHANGES++
DURING PAST THREE MONTHS
SHARES
-----------------------
HOLDINGS
ADDITIONS INCREASE 3/31/96
-------- --------
Browning-Ferris Industries...... 100,000 100,000
Carolina Power and Light ....... 200,000 200,000
Cooper Industries .............. 75,000 75,000
CoreStates Financial ........... 150,000 150,000
Echlin ......................... 75,000 150,000
Edison International ........... 200,000 200,000
International Paper ............ 75,000 175,000
SBC Communications ............. 75,000 75,000
Schweitzer-Mauduit
International ................ 235,000 245,000
U.S. West ...................... 115,000 115,000
HOLDINGS
REDUCTIONS DECREASE 3/31/96
- ---------- -------- --------
Air Products and Chemicals...... 100,000 --
Bausch & Lomb................... 85,000 100,000
Bowater......................... 75,000 --
Bristol-Meyers Squibb........... 35,000 40,000
Coca-Cola....................... 50,000 75,000
Cray Research................... 100,000 --
General Motors (Class H)........ 50,000 75,000
May Department Stores........... 55,000 100,000
Nordstrom....................... 50,000 75,000
Unicom.......................... 300,000 --
- ------------
++ Largest portfolio changes from the previous quarter to the current quarter
are based on cost of purchases and proceeds from sales of securities.
MAJOR PORTFOLIO HOLDINGS
AT MARCH 31, 1996
SECURITY VALUE
- -------- ---------
General Electric....................... $11,681,250
Colgate-Palmolive...................... 9,734,375
PepsiCo................................ 9,487,500
American International Group........... 9,362,500
Royal Dutch Petroleum.................. 9,181,250
Omnicom Group.......................... 9,000,000
Schering-Plough........................ 8,718,750
Dow Chemical........................... 8,687,500
Procter & Gamble....................... 8,475,000
Sara Lee............................... 8,156,250
5
<PAGE>
================================================================================
SELIGMAN COMMON STOCK FUND
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
INVESTMENT RESULTS
TOTAL RETURNS*
For Periods Ended March 31, 1996
AVERAGE ANNUAL
---------------------------------------
CLASS D
THREE ONE FIVE 10 SINCE
MONTHS YEAR YEARS YEARS INCEPTION+
------ ------ ------ ------ ----------
CLASS A
With Sales Charge 0.07% 18.23% 12.33% 11.22% n/a
Without Sales Charge 5.07 24.11 13.43 11.76 n/a
CLASS D
With CDSL 3.92 22.24 n/a n/a n/a
Without CDSL 4.92 23.24 n/a n/a 12.48%
S&P 500** 5.37 32.10 14.67 13.95 17.15+
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
MARCH 31, 1996 DECEMBER 31, 1995
-------------- -----------------
CLASS A $14.83 $14.19
CLASS D $14.80 $14.16
- --------------------------------------------------------------------------------
* The returns for Class A shares are shown with and without the maximum
initial sales charge of 4.75%. No adjustment was made to performance for
periods prior to January 1, 1993, the commencement date for the annual
Administration, Shareholder Services and Distribution Plan fee of up to
0.25% of average daily net assets of Class A shares. The returns for periods
of one year or less for Class D shares are shown with and without the effect
of the 1% contingent deferred sales load ("CDSL")imposed on certain shares
redeemed within one year of purchase. For periods prior to January 1, 1996,
the returns for both Class A and D shares do not reflect the effect of the
increase in the management fee payable by the Fund, which became effective
on that date.
** The S&P 500 is an unmanaged index and assumes reinvestment of estimated
dividends, and does not reflect fees and expenses. Investors may not invest
directly in an index.
+ May 3, 1993.
++ From April 30, 1993.
--------------------------------------------------------------------
THESE RATES OF RETURN REFLECT CHANGES IN PRICE AND ASSUME THAT ALL DISTRIBUTIONS
WITHIN THE PERIOD ARE REINVESTED IN ADDITIONAL SHARES. THE RATES OF RETURN WILL
VARY AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE. SHARES, IF
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE INVESTMENT RESULTS.
6
