- ------------------------------------------------- August 19, 1996
Salomon Brothers
Capital Fund Inc
Dear Shareholder,
WE ARE PLEASED TO PRESENT our Semi-Annual report to shareholders for the Salomon
Brothers Capital Fund Inc for the six months ended June 30, 1996.
THE FUND GENERATED a return of 15.1% in the six months ended June 30, 1996,
exceeding the 10.1% return of the Standard & Poor's Index of 500 stocks and the
11.5% return of the average capital appreciation fund as measured by Lipper
Analytical Services* during the same period.
A SPECIAL MEETING OF STOCKHOLDERS of the Salomon Brothers Capital Fund, will be
held at Seven World Trade Center, New York, New York on September 30, 1996 at
10:00a.m. The Board of Directors of the Fund are asking you to consider and vote
to approve, among other proposals, amendments to the Fund's Articles of
Incorporation to permit implementation by the Fund of the Multiple Class Pricing
System currently in place for the other Funds which are part of the Salomon
Brothers Investment Series family of funds (the "Investment Series").
UNDER THE MULTIPLE CLASS PRICING SYSTEM, the Funds in the Investment Series
offer different classes of shares, each of which has different distribution and
sales charge options. You will continue to have the ability to purchase
additional shares of the Fund without paying any sales charges or distribution
fees and shares you currently hold also will not be subject to any sales charges
or distribution fees. In addition, you will be able to exchange your shares of
the Fund for shares of other Funds in the Investment Series without imposition
of any sales charges, distribution or service fees.
FOLLOWING IMPLEMENTATION you would no longer have the ability to exchange your
shares of the Fund for shares of the Salomon Brothers Opportunity Fund Inc, but
the Salomon Brothers New York Municipal Money Market Fund will be joining the
Investment Series and therefore your ability to exchange for shares of that Fund
would continue. The Fund will no longer have its own prospectus and statement of
additional information but will be combined with the other Funds in the
Investment Series.
SHAREHOLDERS OF THE FUND as of July 23, 1996 will receive a proxy card to cast
your vote on all the proposed changes. We encourage you to review the proxy
materials carefully and consider the impact of the proposed changes.
Page 1
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Market Review
DURING THE FIRST HALF OF 1996, the Fund benefited from its stock selections in
the consumer and energy sectors of the market. Many of these stocks performed
well in 1995 and the sectors continued to fare well in the first six months of
1996. The Fund's holdings generally benefited from a price to earnings ratio
expansion as well as strong operating results and earnings.
The long running equity bull market in the U.S. is as perplexing as it has been
prosperous. For the past five years, stock market participants have correctly
predicted continued strong growth in corporate earnings. The market has taken an
occasional respite when higher interest rates have cast a temporary shadow of
doubt on the assumption of a continually expanding economy. Currently, we
believe the market is reasonably valued based on estimates of corporate earnings
and cash flows. These are the factors that cause the market to continue to
escalate despite record low dividend yields and high price to book ratios. The
key to continued strength in the market is the ability of companies to maintain
high profit margins. If profitability falls, stock prices will not receive
sufficient support for dividend yields.
The Fund's portfolio currently contains a balanced selection of large-, mid- and
small-capitalization stocks. We continue to place emphasis on reasonable
valuations to identify stocks that we believe offer attractive return potential
relative to risk. The Fund continues to be concentrated in consumer related
stocks.
All of us at Salomon Brothers Asset Management Inc appreciate the confidence you
have demonstrated in the past and hope to justify your confidence in the future.
Please call us with any questions or comments you may have at 1-800-SALOMON
(1-800-725-6666).
Cordially,
/s/ MICHAEL S. HYLAND
Chairman and President
*Lipper rankings change monthly and do not reflect the effects of sales charges.
Lipper performance results represent changes in net asset value, adjusted to
reflect reinvestment of dividends and capital gains. Past performance is no
guarantee of future results.
Page 2
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Statement of Net Assets June 30, 1996 (unaudited)
Common Stocks -- 91.7% of Net Assets
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
Value
Shares (Note 1a)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C>
Basic Industries -- 3.9%
20,000 Hercules............................................................. $ 1,105,000
75,000 Nalco Chemical ...................................................... 2,362,500
30,000 OM Group ............................................................ 1,177,500
-----------
4,645,000
-----------
Capital Goods -- 5.5%
40,000 Fluor ............................................................... 2,615,000
30,000 Raytheon ............................................................ 1,548,750
60,000 Tyco International .................................................. 2,445,000
-----------
6,608,750
-----------
Consumer Cyclicals -- 18.8%
86,300 Big Flower Press Holdings* .......................................... 1,218,988
20,000 Eastman Kodak ....................................................... 1,555,000
35,000 Federated Department Stores* ........................................ 1,194,375
75,000 Fine Host* ......................................................... 900,000
35,000 General Motors ...................................................... 1,833,125
225,000 Hollinger............................................................ 1,800,000
50,000 Magna International ................................................. 2,300,000
30,000 Melville............................................................. 1,215,000
100,000 Norton McNaughton* ................................................. 725,000
40,000 Omnicom Group ....................................................... 1,860,000
100,000 Price/Costco* ...................................................... 2,162,500
50,000 Proffitt's* ........................................................ 1,775,000
80,000 Sears, Roebuck ...................................................... 3,890,000
-----------
22,428,988
-----------
Consumer Non-Cyclicals -- 19.3%
100,000 Coca-Cola Enterprises................................................ 3,462,500
50,000 ConAgra ............................................................. 2,268,750
300,000 Food Lion ........................................................... 2,325,000
85,000 Hormel Foods ........................................................ 2,273,750
100,000 IBP.................................................................. 2,762,500
90,000 Kroger* ............................................................ 3,555,000
15,000 Loews................................................................ 1,183,125
30,000 Penn Traffic* ...................................................... 255,000
15,000 Philip Morris Companies ............................................. 1,560,000
45,000 RJR Nabisco Holdings................................................. 1,395,000
80,000 Whitman 1,930,000
-----------
22,970,625
-----------
Energy -- 16.1%
20,000 Amoco ............................................................... 1,447,500
40,000 Ashland.............................................................. 1,585,000
70,000 Diamond Shamrock .................................................... 2,021,250
50,000 Holly................................................................ 1,250,000
40,000 Noble Affiliates..................................................... 1,510,000
60,000 Tejas Gas* ......................................................... 2,085,000
See accompanying notes to financial statements.
Page 3
</TABLE>
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Statement of Net Assets June 30, 1996 (unaudited) (continued)
Common Stocks (continued)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
Value
Shares (Note 1a)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C>
Energy -- (continued)
40,000 Ultramar............................................................. $ 1,160,000
125,000 Union Pacific Resources Group........................................ 3,343,750
40,000 Unocal............................................................... 1,350,000
70,000 Williams Companies................................................... 3,465,000
-----------
19,217,500
-----------
Financial Services -- 9.8%
15,000 Aetna Life & Casualty ............................................... 1,072,500
25,000 Bank of Boston....................................................... 1,237,500
60,000 Bank of New York .................................................... 3,075,000
75,000 Long Island Bancorp.................................................. 2,292,184
25,000 MGIC Investment ..................................................... 1,403,125
30,000 Travelers Group ..................................................... 1,368,750
25,000 Trenwick Group ...................................................... 1,250,000
-----------
11,699,059
-----------
Health Care -- 8.2%
15,000 Astra AB, Class A.................................................... 664,299
70,000 Columbia/HCA Healthcare.............................................. 3,736,250
65,000 FHP International* .................................................. 1,779,375
65,000 SmithKline Beecham-- ADR............................................. 3,534,375
-----------
9,714,299
-----------
Technology -- 6.7%
50,000 Electric Fuel* ...................................................... 343,750
75,000 EMC* ................................................................ 1,396,875
35,000 Greenfield Industries ............................................... 1,155,000
90,000 Plantronics* ....................................................... 3,307,500
20,000 Seagate Technology* ................................................ 900,000
30,000 Spectrian* ......................................................... 427,500
45,000 Stormedia* ......................................................... 489,375
-----------
8,020,000
-----------
Transportation -- 3.4%
125,000 Canadian National Railway............................................ 2,296,875
60,000 Pittston Brink's Group............................................... 1,747,500
-----------
4,044,375
-----------
Total Common Stocks (cost $97,015,261)............................... 109,348,596
-----------
Convertible Preferred Stocks -- 1.9%
- -----------------------------------------------------------------------------------------------------
Consumer Non-Cyclicals -- 1.9%
350,000 RJR Nabisco Holdings, 9.25% (cost $2,138,625)........................ 2,275,000
-----------
</TABLE>
See accompanying notes to financial statements.
Page 4
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Statement of Net Assets June 30, 1996 (unaudited) (continued)
Convertible Corporate Bonds -- 1.3%
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
Principal Value
Amount (Note 1a)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C>
Technology -- 1.3%
$1,500,000 Connor Peripherals, 6.50%, due 03/01/02 (cost $1,678,087)............ $ 1,548,750
------------
Purchased Options -- 0.1%
- -----------------------------------------------------------------------------------------------------
Contracts
- -----------------------------------------------------------------------------------------------------
50 Nasdaq Index Puts (expiring July 1996, exercise price $625).......... 11,250
100 S&P 400 MIDCAP Index Puts
(expiring August 1996, exercise price $200)........................ 5,000
100 S&P 400 MIDCAP Index Puts
(expiring December 1996, exercise price $200)...................... 22,500
175 S&P 500 Index Puts (expiring July 1996, exercise price $635) ........ 15,314
75 S&P 500 Index Puts (expiring August 1 996, exercise price $630) ..... 18,282
------------
Total Purchased Options (cost $157,339).............................. 72,346
------------
Total Investments-- 95.0% (cost $100,989,312)........................ 113,244,692
------------
Repurchase Agreements -- 5.8%
- -----------------------------------------------------------------------------------------------------
Principal
Amount
- -----------------------------------------------------------------------------------------------------
$3,444,000 Repurchase Agreement, 5.42% due 07/01/96, dated 06/28/96, with
J.P. Morgan Securities, collateralized by $2,331,000 U.S.
Treasury Bonds, 12.50%, due 08/15/14 valued at $3,513,983;
proceeds: $3,445,556............................................... 3,444,000
3,443,000 Repurchase Agreement, 5.30% due 07/01/96, dated 06/28/96, with
Merrill Lynch, Pierce, Fenner & Smith, collateralized by
$5,520,000 U.S. Treasury Strips, Zero-Coupon, due 05/15/03,
valued at $3,512,100; proceeds: $3,444,521......................... 3,443,000
------------
Total Repurchase Agreements (cost $6,887,000) ....................... 6,887,000
------------
Cash and Receivables-- 1.3%........................ $ 1,543,008
Liabilities-- (2.1)%............................... (2,495,279) (952,271)
----------- ------------
Net Assets -- equivalent to $20.45, offering and
redemption price per share on 5,827,321 shares of
$1.00 par value capital stock outstanding;
25,000,000 shares authorized...................................... $119,179,421
============
Net Assets Consist of:
Capital stock........................................................ $ 5,827,321
Additional paid-in capital .......................................... 86,598,860
Undistributed net investment income ................................. 413,392
Undistributed net realized gain ..................................... 14,084,495
Net unrealized appreciation ......................................... 12,255,353
------------
Net Assets........................................................... $119,179,421
============
- -----------
<FN>
*Non-income producing security.
</FN>
See accompanying notes to financial statements.
Page 5
</TABLE>
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Statement of Operations for the six months ended June 30, 1996 (unaudited)
<TABLE>
Investment Income
<S> <C>
Income
Dividends (net of foreign withholding taxes of $14,244).............................. $ 898,492
Interest............................................................................. 237,493
-----------
1,135,985
<S> <C> <C>
Expenses
Management fee......................................................... $ 548,783
Directors' fees and expenses........................................... 32,765
Legal.................................................................. 29,415
Audit and tax return preparation fees.................................. 26,995
Shareholder services................................................... 24,570
Custodian.............................................................. 22,135
Printing............................................................... 17,285
Registration and filing fees........................................... 9,405
Other.................................................................. 15,710 727,063
---------- -----------
Net investment income................................................................ 408,922
-----------
Net Realized Gain on Investments, Options and Foreign Currencies
Net realized gain on investments, options and foreign currencies..................... 14,096,425
Net Unrealized Appreciation of Investments
Beginning of period.................................................... 11,140,591
End of period.......................................................... 12,255,353
----------
Increase in net unrealized appreciation.............................................. 1,114,762
-----------
Net realized gain and increase in net unrealized appreciation........................ 15,211,187
-----------
Net increase in net assets from operations........................................... $15,620,109
===========
</TABLE>
See accompanying notes to financial statements.
Page 6
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
<TABLE>
<CAPTION>
Statement of Changes in Net Assets
Six Months
Ended Year Ended
June 30, 1996 December 31,
(unaudited) 1995
- -----------------------------------------------------------------------------------------------------
Operations
<S> <C> <C>
Net investment income...................................... $ 408,922 $ 702,996
Net realized gain on investments, options and
foreign currencies....................................... 14,096,425 20,581,764
Increase in net unrealized appreciation.................... 1,114,762 7,415,877
------------ ------------
Net increase in net assets from operations................. 15,620,109 28,700,637
------------ ------------
Distributions to Shareholders from
Net investment income...................................... -- (698,526)
Net realized gain on investments, options and
foreign currencies....................................... (5,326,277) (11,082,177)
------------ ------------
(5,326,277) (11,780,703)
Capital Share Transactions
Proceeds from sales of 937,773 and 1,609,281 shares,
respectively............................................. 18,287,351 29,031,088
Net asset value of 264,298 and 600,042 shares, respectively,
issued in reinvestment of net investment income and net
realized gain distributions.............................. 5,041,709 11,026,944
Payment for redemption of 859,573 and 2,277,011 shares,
respectively............................................. (16,872,098) (41,253,697)
------------ ------------
Change in net assets resulting from capital share
transactions, representing net increase of 342,498 and
net decrease of 67,688 shares, respectively.............. 6,456,962 (1,195,665)
------------ ------------
Total increase in net assets............................... 16,750,794 15,724,269
Net Assets
Beginning of period........................................ 102,428,627 86,704,358
------------ ------------
End of period (includes undistributed net investment income
of $413,392 and $4,470, respectively).................... $119,179,421 $102,428,627
============ ============
See accompanying notes to financial statements.
Page 7
</TABLE>
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Notes to Financial Statements (unaudited)
1. Significant Accounting Policies
The Fund is registered as a non-diversified, open-end, management investment
company under the Investment Company Act of 1940, as amended. The Fund's
investment objective is capital appreciation through investments primarily in
common stocks or securities convertible into common stocks which are believed to
have above-average price appreciation potential and which may also involve
above-average risk. The following is a summary of significant accounting
policies consistently followed by the Fund in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principals ("GAAP"). The preparation of financial statements in accordance with
GAAP requires management to make estimates of certain reported amounts in the
financial statements. Actual amounts could differ from those estimates.
(a) Securities Valuation. Portfolio securities listed or traded on
national securities exchanges, or reported by the NASDAQ national market
system, are valued at the last sale price, or, if there have been no sales
on that day, at the mean of the current bid and ask price which represents
the current value of the security. Over-the-counter securities are valued at
the mean of the current bid and ask price. If no quotations are readily
available (as may be the case for securities of limited marketability), such
portfolio securities are valued at a fair value determined pursuant to
procedures established by the Board of Directors.
(b) Option Contracts. When the Fund writes or purchases a call option or
a put option, an amount equal to the premium received or paid is recorded as
a liability or asset, the value of which is marked-to-market daily to
reflect the current market value of the option. When the option expires, the
Fund realizes a gain or loss equal to the amount of the premium received or
paid. When the Fund enters into a closing transaction by purchasing or
selling an offsetting option, it realizes a gain or loss without regard to
any unrealized gain or loss on the underlying security. When a written call
option is exercised, the Fund realizes a gain or loss from the sale of the
underlying security and the proceeds from such sale are increased by the
premium originally received. When a written put option is exercised, the
amount of the premium received reduces the cost of the security that the
Fund purchased upon exercise.
(c) Federal Income Taxes. The Fund has complied and intends to continue
to comply with the requirements of the Internal Revenue Code of 1986, as
amended, applicable to regulated investment companies, and to distribute all
of its taxable income to its shareholders. Therefore, no Federal income tax
or excise tax provision is required.
(d) Repurchase Agreements. When entering into repurchase agreements, it
is the Fund's policy to take possession, through its custodian, of the
underlying collateral and to monitor its value at the time the arrangement
is entered into and at all times during the term of the repurchase agreement
to ensure that it always equals or exceeds the repurchase price. In the
event of default of the obligation to repurchase, the Fund has the right to
liquidate the collateral and apply the proceeds in satisfaction of the
obligation. Under certain circumstances, in the event of default or
bankruptcy by the other party to the agreement, realization and/or retention
of the collateral may be subject to legal proceedings.
Page 8
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Notes to Financial Statements (unaudited) (continued)
(e) Dividends and Distributions. Dividends and distributions to
shareholders are recorded on the ex-dividend date, and determined in
accordance with income tax regulations which may differ from generally
accepted accounting principles due primarily to deferral of wash sales.
(f) Other. Securities transactions are recorded as of the trade date.
Dividend income is recorded on the ex-dividend date. Gains or losses on
sales of securities are calculated for financial accounting and Federal tax
purposes on the identified cost basis. Interest is recognized as interest
income when earned.
2. Capital Stock
Payable for Fund shares redeemed at June 30, 1996 amounted to $488,353.
3. Management Fee and Other Transactions
The Fund retains Salomon Brothers Asset Management Inc ("SBAM"), an
indirect, wholly-owned subsidiary of Salomon Inc, to act as investment manager
of the Fund subject to supervision by the Board of Directors of the Fund. SBAM
furnishes the Fund with office space and pays the compensation of its officers.
The management fee for these services is payable monthly and is based on the
following annual percentages of the Fund's average daily net assets: first $100
million -- 1%; next $100 million -- .75%; next $200 million -- .625%; excess
over $400 million -- .50%. The management fee payable at June 30, 1996 was
$94,003.
Brokerage commissions of $8,490 were paid to Salomon Brothers Inc, the
Fund's distributor and an indirect wholly-owned subsidiary of Salomon Inc, for
transactions executed on behalf of the Fund during the six months ended June 30,
1996.
If in any fiscal year the total expenses of the Fund, excluding taxes,
interest, brokerage and extraordinary expenses, but including the management
fee, exceed the most stringent expense limitation imposed by state securities
regulations applicable to the Fund, SBAM will pay or reimburse the Fund for the
excess. Currently, this limitation on an annual basis is 2.5% of the first $30
million of average daily net assets, 2.0% of the next $70 million of average
daily net assets and 1.5% of average daily net assets in excess of $100 million.
For the six months ended June 30, 1996, there was no such reimbursement.
Page 9
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Notes to Financial Statements
(unaudited)
4. Portfolio Activity
The cost of securities purchased and proceeds from securities sold (other
than short-term investments) during the six months ended June 30, 1996
aggregated $111,781,352 and $107,576,225, respectively. Amounts payable for
securities purchased at June 30, 1996 aggregated $1,858,925.
Cost of securities held (excluding short-term investments and written
options) on June 30, 1996 for Federal income tax purposes was substantially the
same as for book purposes. As of June 30, 1996, total unrealized appreciation
and depreciation, based on the cost for Federal income tax purposes, was
approximately $13,830,000 and $1,575,000, respectively, resulting in net
unrealized appreciation of approximately $12,255,000.
Transactions in options written during the six months ended June 30, 1996
were as follows:
Number of Premiums
Contracts Received
--------- --------
Options outstanding at December 31, 1995................ -- --
Options written......................................... (100) $(10,950)
Options terminated in closing purchase transactions..... 100 10,950
Options expired......................................... -- --
Options exercised....................................... -- --
-------- --------
Options outstanding at June 30, 1996.................... -- --
======== ========
During the six months ended June 30, 1996 net realized gain from written
option transactions amounted to $650. During the six months ended June 30, 1996
net realized loss from purchased option transactions amounted to $74,223, for a
net realized loss on all option transactions of $73,573.
The risk in writing a covered call option is that the Fund may forego the
opportunity of profit if the market price of the underlying security increases
and the option is exercised. The risk in writing a put option is that the Fund
may incur a loss if the market price of the underlying security decreases and
the option is exercised. In addition, there is the risk that the Fund may not be
able to enter a closing transaction because of an illiquid secondary market.
5. Subsequent Event
On July 16, 1996, the Board of Directors of the Fund approved the
implementation of a multiple class pricing system which is currently pending
shareholder approval. In connection with such implementation, the Fund will
designate all outstanding shares of capital stock as Class O shares and will
create three new classes of shares designated Class A, Class B and Class C
shares. Each of the new classes of shares has its own distribution plan and
sales charge structure.
Page 10
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Financial Highlights
Selected data per share of capital stock outstanding throughout each period:
<TABLE>
<CAPTION>
Six Months
Ended Year Ended December 31,
June 30, 1996 ----------------------------------------------------------
(unaudited) 1995 1994 1993 1992 1991
- --------------------------------------------------------------------------------------------------------------
Per Share Operating Performance:
<S> <C> <C> <C> <C> <C> <C>
Net asset value
beginning of period............. $18.67 $15.62 $20.80 $19.64 $19.06 $14.86
------ ------ ------ ------ ------ ------
Net investment income............... .07 .14 .03 .028 .10 .33
Net gains (losses) on securities
(both realized and unrealized).. 2.67 5.27 (2.87) 3.242 .80 4.56
------ ------ ------ ------- ------ ------
Total from investment
operations.............. 2.74 5.41 (2.84) 3.27 .90 4.89
------ ------ ------ ------ ------ ------
Less dividends and distributions:
Dividends from net investment
income.......................... -- (.14) (.03) (.035) (.105) (.325)
Distributions from net realized
gain on investments............. (.96) (2.22) (1.51) (2.075) (.215) (.365)
Distribution in excess of
net realized gains.............. -- -- (.80) -- -- --
------ ------ ------ ------ ------ ------
Total dividends and
distributions........... (.96) (2.36) (2.34) (2.11) (.32) (.69)
------ ------ ------ ------ ------ ------
Net asset value
end of period................... $20.45 $18.67 $15.62 $20.80 $19.64 $19.06
------ ------ ------ ------ ------ ------
Total investment return based on
net asset value per share....... +15.1% +34.9% -14.2% +17.2% +4.7% +33.4%
Ratios/Supplemental Data:
Net assets end of period
(thousands)..................... $119,179 $102,429 $86,704 $113,905 $103,356 $89,829
Ratio of expenses to average
net assets...................... 1.29%* 1.36% 1.30% 1.31% 1.34% 1.48%
Ratio of net investment income
to average net assets........... 0.73%* 0.74% 0.12% 0.13% 0.58% 1.87%
Portfolio turnover rate............. 102% 217% 152% 104% 41% 94%
Average broker commission rate...... $0.0559 N/A N/A N/A N/A N/A
<FN>
- -------------
* Annualized.
</FN>
Page 11
</TABLE>
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
(Right Column)
Salomon Brothers Capital Fund Inc
7 World Trade Center
New York, New York 10048
1-800-SALOMON (1-800-725-6666)
INVESTMENT MANAGER
Salomon Brothers Asset Management Inc
7 World Trade Center
New York, New York 10048
DISTRIBUTOR
Salomon Brothers Inc
7 World Trade Center
New York, New York 10048
CUSTODIAN
Investors Bank & Trust Company
89 South Street
Boston, Massachusetts 02111
DIVIDEND DISBURSING AND TRANSFER AGENT
First Data Investor Services Group, Inc.
53 State Street
Boston, Massachusetts 02109-2873
LEGAL COUNSEL
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017-3909
- ------------------------------------------------------
This report is submitted for the general information
of the shareholders of Salomon Brothers Capital Fund
Inc. It is not authorized for distribution to
prospective investors unless accompanied or preceded
by an effective Prospectus for the Fund, which
contains information concerning the Fund's investment
policies and expenses as well as other pertinent
information.
- ------------------------------------------------------
(Left Column)
Family of Funds*
Salomon Brothers
Opportunity Fund Inc
AN equity fund that invests for long-term capital
appreciation. Current income is secondary. The Fund
may employ speculative investment techniques to attain
its goals.
Salomon Brothers New York
Municipal Money Market Fund
A MONEY market fund that invests in high - quality,
short-term municipal securities with the goal of
providing as high a level of current income exempt
from regular Federal, New York State and New York City
personal income taxes as is consis tent with liquidity
and stability of principal. Income may not be exempt
from certain state or local taxes.
- --------------------------------------------------------------------------------
*For more complete information about the Salomon Brothers Family of Funds, you
may obtain a Prospectus by calling 1-800-SALOMON (1-800-725-6666).
Page 12
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
Directors
CHARLES F. BARBER*
Consultant; formerly Chairman,
ASARCO Incorporated
ANDREW L. BREECH++
President, Dealer Operating Control
Service Inc.
THOMAS W. BROCK
Chairman and Chief Executive Officer,
Salomon Brothers Asset Management Inc:
Managing Director, Salomon Brothers Inc
CAROL L. COLMAN*
President, Colman Consulting Co., Inc.
WILLIAM R. DILL+
President, Anna Maria College;
formerly Consultant and Director of
the Office of Global Enterprise, University of
Southern Maine
MICHAEL S. HYLAND
Chairman and President, President, Salomon
Brothers Asset Management Inc; Managing
Director, Salomon Brothers Inc
CLIFFORD M. KIRTLAND, JR.++
Formerly Chairman,
Cox Communications, Inc.
ROBERT W. LAWLESS++
President and Chief Executive Officer,
Texas Tech University
LOUIS P. MATTIS+
Formerly Chairman and President, Sterling
Winthrop Inc.
THOMAS F. SCHLAFLY*+
Of counsel to law firm of Peper, Martin,
Jensen, Maichel & Hetlage; President,
The Saint Louis Brewery, Inc.
(Right Column)
Officers
MICHAEL S. HYLAND
Chairman and President
RICHARD E. DAHLBERG
Executive Vice President
ALLAN R. WHITE, III
Executive Vice President
ROSS S. MARGOLIES
Executive Vice President
LAWRENCE H. KAPLAN
Executive Vice President
and General Counsel
ALAN M. MANDEL
Treasurer
TANA E. TSELEPIS
Secretary
JANET S. TOLCHIN
Assistant Treasurer
REJI PAUL
Assistant Treasurer
JENNIFER G. MUZZEY
Assistant Secretary
Honorary Director
EDWIN A. GEE
Formerly Chairman,
International Paper Company
- -----------
*Member Audit Committee
+Member Nominating Committee
++Member Proxy Committee
Page 13
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S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
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Page 14
<PAGE>
S A L O M O N B R O T H E R S C A P I T A L F U N D I N C
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Page 15
<PAGE>
(Right Column)
Salomon Brothers
Capital Fund Inc
Semi-Annual Report
JUNE 30, 1996
- --------------------------------------
Salomon Brothers Asset Management
--------------------------------------
(Left Column)
Salomon Brothers Asset Management
Seven World Trade Center
New York, New York 10048
-----------------
BULK RATE
U.S. POSTAGE
PAID
BOSTON, MA
PERMIT No.
54201
-----------------
