UNITED
FUNDS, INC.
United Bond Fund
United Income Fund
United Accumulative Fund
United Science and Technology Fund
SEMIANNUAL
REPORT
--------------------------------------
For the six months ended June 30, 1995
<PAGE>
This report is submitted for the general information of the shareholders of
United Funds, Inc. It is not authorized for distribution to prospective
investors unless accompanied with or preceded by the United Funds, Inc. current
prospectus.
<PAGE>
PRESIDENT'S LETTER
JUNE 30, 1995
Dear Shareholder:
As President of your Fund, I would like to thank you for your continued
confidence in our products and services. We strive to provide the best service
possible to our shareholders: from the Fund's manager, to Waddell & Reed's
customer service representatives, to your personal account representative and
the Waddell & Reed office nearest you.
While personalized service has become increasingly rare in the investment
industry, we remain committed to locally based account representatives who
provide the personal service you need. They are ready to assist you through
regular reviews of your financial plan and to answer any financial questions
you may have. Your account representative is anxious to help you plan for your
retirement, fund a child's education or make plans for other long-term
financial goals.
We want to help you open the door to a better financial future. We will
continue to help you meet your specific financial needs through quality
investment products and personalized service that makes the investment process
more convenient and accessible for you.
Should you have any questions about your account or other financial
issues, contact your personal account representative or your local Waddell &
Reed office. They're ready to help you make the most of your financial future.
Respectfully,
Keith A. Tucker
President
<PAGE>
SHAREHOLDER SUMMARY
----------------------------------------------------------------------
UNITED BOND FUND
PORTFOLIO STRATEGY:
Corporate and government OBJECTIVE: Reasonable return with emphasis on
bonds the preservation of principal.
Maximum 10% Non-Debt
Securities STRATEGY: Invests in bonds issued by companies in
a variety of industries and in
government securities. (May purchase
securities subject to repurchase
agreements. May invest in certain
options and futures.)
FOUNDED: 1964
SCHEDULED DIVIDEND FREQUENCY: MONTHLY
PERFORMANCE SUMMARY
PER SHARE DATA
For the Six Months Ended June 30, 1995
--------------------------------------
DIVIDENDS PAID $0.20
=====
NET ASSET VALUE ON
6/30/95 $6.10
12/31/94 5.62
-----
CHANGE PER SHARE $0.48
=====
Past performance is not necessarily an indication of future results.
TOTAL RETURN HISTORY
Average Annual Total Return
---------------------------
With Without
Period Sales Load* Sales Load**
------ ----------- ------------
1-year period ended 6-30-95 5.93% 12.39%
5-year period ended 6-30-95 8.35% 9.64%
10-year period ended 6-30-95 9.38% 10.03%
*Performance data quoted represents past performance and is based on deduction
of 5.75% sales load on the initial purchase in each of the three periods.
**Performance data quoted in this column represents past performance without
taking into account the sales load deducted on an initial purchase.
Investment return and principal value will fluctuate and an investor's shares,
when redeemed, may be worth more or less than their original cost.
<PAGE>
PORTFOLIO HIGHLIGHTS
On June 30, 1995, United Bond Fund had net assets totaling $550,224,296
invested in a diversified portfolio of:
94.44% Bonds
5.56% Cash and Cash Equivalents
As a shareholder of United Bond Fund, for every $100 you had invested on June
30, 1995, your Fund owned:
Bonds:
Corporate $66.14
U.S. Government 23.09
Other Government 5.21
Cash and Cash Equivalents 5.56
Not all holdings will be represented in the portfolio at all times.
<PAGE>
THE INVESTMENTS OF UNITED BOND FUND
JUNE 30, 1995
Principal
Amount in
Thousands Value
CORPORATE DEBT SECURITIES
Aerospace - 2.05%
McDonnell Douglas Corporation,
9.25%, 4-1-2002 ....................... $10,000 $ 11,287,800
Airlines - 1.91%
Federal Express Corporation,
7.89%, 9-23-2008 ...................... 10,000 10,497,500
Automotive - 3.76%
General Motors Corporation,
8.8%, 3-1-2021 ........................ 11,600 13,139,088
Toyota Motor Credit Corporation, Medium
Term, Three Year Basket Inverse
Floating Rate,
0.74%, 8-5-96 (A) ..................... 8,000 7,552,400
Total ................................. 20,691,488
Banks and Savings and Loans - 6.89%
Bayerische Landesbank Girozentale, NY Branch,
CD, Currency Protected Duetschemark Swap
Rate Inverse Floating Rate,
3.85%, 3-28-97 (B) .................... 5,000 4,793,750
Chevy Chase Savings Bank, F.S.B.,
9.25%, 12-1-2005 ...................... 1,500 1,455,000
Citicorp,
7.75%, 6-15-2006 ...................... 5,000 5,241,950
Kansallis-Osake-Pankki,
10.0%, 5-1-2002 ....................... 6,000 6,956,220
Riggs National Corporation,
8.5%, 2-1-2006 ....................... 4,000 4,080,000
Skandia Enskilda Banken, NY Branch Certificate
of Deposit Dollarized Australian Dollar
Reset,
4.0%, 4-5-99 .......................... 5,000 4,550,000
SouthTrust Bank of Alabama, N.A.,
7.69%, 5-15-2025 ...................... 5,000 5,315,250
Wells Fargo & Company,
8.75%, 5-1-2002 ....................... 5,000 5,501,550
Total ................................. 37,893,720
Beverages - 1.18%
Coca-Cola Enterprises Inc.,
0.0%, 6-20-2020 ....................... 40,000 6,500,000
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED BOND FUND
JUNE 30, 1995
Principal
Amount in
Thousands Value
CORPORATE DEBT SECURITIES (Continued)
Building - 5.19%
Canadian Pacific Forest Products Ltd.,
9.25%, 6-15-2002 ..................... $ 3,000 $ 3,135,960
Doman Industries Limited,
8.75%, 3-15-2004 ...................... 2,000 1,900,000
Georgia-Pacific Corporation,
9.5%, 5-15-2022 ....................... 3,000 3,326,190
Noranda Forest Inc.,
7.5%, 7-15-2003 ....................... 3,000 3,052,680
Noranda Inc.,
8.625%, 7-15-2002 ..................... 7,000 7,624,330
Owens-Corning Fiberglas Corporation,
8.875%, 6-1-2002 ...................... 5,000 5,440,450
Del Webb Corporation,
10.875%, 3-31-2000 .................... 4,000 4,100,000
Total ................................. 28,579,610
Canadian Oil - 2.00%
NOVA Corporation of Alberta,
8.5%, 12-15-2012 ...................... 10,000 11,009,300
Chemicals Major - 2.05%
Dow Capital Corporation,
9.0%, 5-15-2010 ....................... 9,550 11,260,501
Computers and Office Equipment - 0.57%
Unisys Corporation:
9.75%, 9-15-96 ........................ 1,500 1,533,750
10.625%, 10-1-99 ...................... 1,500 1,612,500
Total ................................. 3,146,250
Domestic Oil - 3.60%
Apache Corporation,
9.25%, 6-1-2002 ....................... 5,000 5,559,900
LASMO (USA) INC.,
7.125%, 6-1-2003 ...................... 5,000 5,003,500
Seagull Energy Corporation,
7.875%, 8-1-2003 ...................... 4,250 4,037,500
Union Texas Petroleum Holdings, Inc.,
8.25%, 11-15-99 ....................... 5,000 5,201,900
Total ................................. 19,802,800
Drugs and Hospital Supply - 0.57%
American Home Products Corporation,
7.7%, 2-15-2000 ....................... 3,000 3,140,040
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED BOND FUND
JUNE 30, 1995
Principal
Amount in
Thousands Value
CORPORATE DEBT SECURITIES (Continued)
Electrical Equipment - 3.25%
General Electric Capital Corporation:
8.3%, 9-20-2009 ....................... $15,000 $ 16,866,000
8.65%, 5-1-2018 ....................... 1,000 1,019,080
Total ................................. 17,885,080
Financial - 11.21%
Banc One Credit Card Master Trust,
7.55%, 12-15-99 ....................... 5,000 5,128,100
Chrysler Financial Corporation,
12.75%, 11-1-99 ....................... 9,000 10,997,730
Countrywide Mortgage Backed Securities,
Inc., Series 1994-G A5,
6.5%, 4-25-2024 ....................... 10,000 9,743,700
DLJ Mortgage Acceptance Corp.
1994-3 A13,
6.5%, 4-25-2024 ....................... 4,875 4,619,407
Equicon Loan Trust,
7.3%, 2-18-2013 ....................... 4,571 4,394,891
General Motors Acceptance Corporation,
8.875%, 6-1-2010 ...................... 10,000 11,509,100
Greyhound Financial Corporation,
8.0%, 1-15-97 ......................... 5,000 5,116,200
Residential Funding Mortgage
Securities I, Inc.,
8.0%, 8-25-2020 ....................... 10,000 10,146,800
Total ................................. 61,655,928
Food and Related - 1.48%
Nabisco, Inc.:
6.8%, 9-1-2001 ........................ 5,000 5,006,500
8.625%, 3-15-2017 ..................... 3,000 3,155,250
Total ................................. 8,161,750
Hospital Management - 0.46%
Columbia/HCA Healthcare Corporation,
7.69%, 6-15-2025 ...................... 1,500 1,491,360
National Medical Enterprises, Inc.,
9.625%, 9-1-2002 ...................... 1,000 1,055,000
Total ................................. 2,546,360
Household Products - 2.09%
Procter & Gamble Company (The),
8.0%, 9-1-2024 ........................ 10,000 11,492,300
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED BOND FUND
JUNE 30, 1995
Principal
Amount in
Thousands Value
CORPORATE DEBT SECURITIES (Continued)
Insurance - 1.14%
Penn Central Corporation (The),
10.625%, 4-15-2000 .................... $ 4,000 $ 4,293,360
Reliance Group Holdings, Inc.,
9.0%, 11-15-2000 ...................... 2,000 1,965,000
Total ................................. 6,258,360
International Oil - 0.32%
YPF Sociedad Anoima,
8.0%, 2-15-2004........................ 2,000 1,740,000
Leisure Time - 4.54%
Jones Intercable, Inc.,
9.625%, 3-15-2002 ..................... 1,500 1,567,500
Marriott International, Inc.,
6.75%, 12-15-2003 ..................... 5,000 4,903,150
Tele-Communications, Inc.:
6.58%, 2-15-2005 ..................... 3,000 2,945,010
9.8%, 2-1-2012 ....................... 4,000 4,398,240
Time Warner Incorporated,
7.75%, 6-15-2005 ...................... 5,000 4,963,750
Turner Broadcasting System, Inc.,
8.375%, 7-1-2013 ...................... 4,000 3,659,600
Viacom Inc.,
7.75%, 6-1-2005 ....................... 2,500 2,524,100
Total ................................. 24,961,350
Machinery - 0.44%
Caterpillar, Inc.,
9.375%, 8-15-2011 ..................... 2,000 2,406,560
Multi-Industry - 1.40%
ITT Corporation,
8.85%, 7-15-2005 ...................... 4,000 4,666,640
Mark IV Industries, Inc.,
8.75%, 4-1-2003 ....................... 3,000 3,060,000
Total ................................. 7,726,640
Public Utilities - Pipelines - 3.58%
Arkla, Inc.,
8.875%, 7-15-99 ....................... 10,000 10,500,000
Coastal Corporation (The),
10.375%, 10-1-2000 .................... 5,000 5,712,450
Tenneco Inc.,
10.375%, 11-15-2000 ................... 3,000 3,479,280
Total ................................. 19,691,730
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED BOND FUND
JUNE 30, 1995
Principal
Amount in
Thousands Value
CORPORATE DEBT SECURITIES (Continued)
Publishing and Advertising - 2.29%
News America Holdings Incorporated:
9.125%, 10-15-99 ...................... $ 5,000 $ 5,423,250
8.25%, 8-10-2018 ...................... 7,000 7,188,300
Total ................................. 12,611,550
Retailing - 0.17%
Penn Traffic Company,
8.625%, 12-15-2003 .................... 1,000 945,000
Steel - 0.96%
USX Corporation,
8.21%, 1-21-2000 ...................... 5,000 5,268,900
Telecommunications - 3.04%
Bell Telephone Company of Pennsylvania (The),
8.35%, 12-15-2030 ..................... 5,000 5,897,750
New England Telephone & Telegraph Company,
7.875%, 11-15-2029 .................... 10,000 10,831,500
Total ................................. 16,729,250
TOTAL CORPORATE DEBT SECURITIES - 66.14% $363,889,767
(Cost: $355,220,063)
OTHER GOVERNMENT SECURITIES
Australia - 0.62%
New South Wales Treasury,
7.0%, 8-15-98 (C)...................... $A5,000 3,440,769
Canada - 3.53%
Hydro Quebec,
8.05%, 7-7-2024 ....................... 10,000 10,929,300
Province of Manitoba,
9.125%, 1-15-2018 ..................... 7,000 8,476,230
Total ................................. 19,405,530
Supranational - 1.06%
Inter-American Development Bank,
8.4%, 9-1-2009 ........................ 5,000 5,839,400
TOTAL OTHER GOVERNMENT SECURITIES - 5.21% $ 28,685,699
(Cost: $26,381,463)
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED BOND FUND
JUNE 30, 1995
Principal
Amount in
Thousands Value
UNITED STATES GOVERNMENT SECURITIES
Federal Home Loan Mortgage Corporation:
6.83%, 7-3-2002 ....................... $ 4,500 $ 4,465,530
7.83%, 6-27-2005 ...................... 4,000 4,004,000
7.5%, 11-15-2017 ...................... 8,000 8,190,000
7.5%, 4-15-2019 ....................... 11,389 11,303,845
8.0%, 4-1-2025 ........................ 9,785 9,968,333
Federal National Mortgage Association:
7.09%, 4-1-2004 ....................... 4,500 4,491,000
7.0%, 7-25-2006 ....................... 10,000 10,037,500
7.5%, 12-25-2006 ...................... 5,000 5,103,100
7.5%, 9-1-2009 ........................ 9,625 9,783,773
6.5%, 5-25-2018 ....................... 10,000 9,787,500
8.0%, 5-25-2019 ....................... 5,120 5,219,215
7.0%, 8-25-2021 ....................... 10,000 9,909,300
United States Treasury:
6.875%, 10-31-96 ...................... 10,000 10,132,800
6.5%, 5-15-97 ......................... 9,000 9,102,690
8.875%, 8-15-2017 ..................... 12,500 15,562,500
TOTAL UNITED STATES GOVERNMENT
SECURITIES - 23.09% $127,061,086
(Cost: $122,935,028)
TOTAL SHORT-TERM SECURITIES - 5.21% $ 28,650,528
(Cost: $28,650,528)
TOTAL INVESTMENT SECURITIES - 99.65% $548,287,080
(Cost: $533,187,082)
CASH AND OTHER ASSETS, NET OF LIABILITIES - 0.35% 1,937,216
NET ASSETS - 100.00% $550,224,296
See Notes to Schedules of Investments on page 31.
<PAGE>
SHAREHOLDER SUMMARY
-----------------------------------------------------------------
UNITED INCOME FUND
PORTFOLIO STRATEGY:
Investment quality OBJECTIVE: Maintenance of current income,
dividend-paying subject to changing market
common stocks conditions.
Cash Reserves STRATEGY: Invests principally in common stocks of
companies which have the potential for
capital growth or which may be expected
to resist market decline. (May
purchase securities subject to
repurchase agreements. May invest in
certain options and futures.)
The use of cash reserves (often
invested in money market securities)
for defensive purposes is a strategy
that may be utilized by the Income Fund
from time to time.
Moving into cash reserve positions at
times thought to be near a major stock
market peak allows the Fund the
opportunity to capture profits and
attempts to cushion the impact of
market declines. The added flexibility
provided by our CASH RESERVES STRATEGY
has from time to time been an important
element in our past success and, when
deemed appropriate, may be used in the
management of the portfolio in the
future.
FOUNDED: 1940
SCHEDULED DIVIDEND FREQUENCY: QUARTERLY
(MARCH, JUNE, SEPTEMBER, DECEMBER)
<PAGE>
PERFORMANCE SUMMARY
PER SHARE DATA
For the Six Months Ended June 30, 1995
--------------------------------------
DIVIDENDS PAID $ 0.16
======
NET ASSET VALUE ON
6/30/95 $27.97
12/31/94 23.34
------
CHANGE PER SHARE $ 4.63
======
Past performance is not necessarily an indication of future results.
TOTAL RETURN HISTORY
Average Annual Total Return
---------------------------
With Without
Period Sales Load* Sales Load**
------ ----------- ------------
1-year period ended 6-30-95 14.34% 21.32%
5-year period ended 6-30-95 10.91% 12.23%
10-year period ended 6-30-95 15.03% 15.72%
*Performance data quoted represents past performance and is based on deduction
of 5.75% sales load on the initial purchase in each of the three periods.
**Performance data quoted in this column represents past performance without
taking into account the sales load deducted on an initial purchase.
Investment return and principal value will fluctuate and an investor's shares,
when redeemed, may be worth more or less than their original cost.
<PAGE>
PORTFOLIO HIGHLIGHTS
On June 30, 1995, United Income Fund had net assets totaling $3,767,705,549
invested in a diversified portfolio of:
92.21% Common Stocks
3.26% U.S. Government Securities
2.77% Cash and Cash Equivalents
1.18% Preferred Stock
0.58% Corporate Debt Securities
As a shareholder of United Income Fund, for every $100 you had invested on June
30, 1995, your Fund owned:
Basic Industries Stocks $40.64
Technological Stocks 26.56
Consumer Stocks 19.82
Financial Stocks 5.19
U.S. Government Securities 3.26
Cash and Cash Equivalents 2.77
Preferred Stock 1.18
Corporate Debt Securities 0.58
Not all holdings will be represented in the portfolio at all times.
<PAGE>
---------------------------------------------------------------------------
These STOCK CATEGORIES are provided as a reference only. Not all categories or
subcategories will be represented in a portfolio at all times. Refer to the
following pages for a more detailed portfolio listing.
BASIC INDUSTRIES
Airlines
Automotive
Building
Chemicals Major
Electrical Equipment
Engineering and Construction
Machinery
Manufacturers
Metals and Mining
Multi-Industry
Paper
Precious Metals
Railroad Equipment
Railroads
Shipping
Steel
Tire and Rubber
Trucking
CONSUMER
Beverages
Consumer Electronics and Appliances
Food and Related
Hospital Management
Household Products
Leisure Time
Packaging and Containers
Publishing and Advertising
Retailing
Services, Consumer and Business
Textiles and Apparel
Tobacco
ENERGY AND ENERGY-RELATED
Canadian Oil
Coal
Domestic Oil
International Oil
Oil Services
Propane
FINANCIAL
Banks and Savings and Loans
Financial
Insurance
PUBLIC UTILITIES
Electric
Gas
Pipelines
TECHNOLOGICAL
Aerospace
Biotechnology and Medical Services
Chemicals Specialty and Miscellaneous Technology
Computers and Office Equipment
Drugs and Hospital Supply
Electronics
Telecommunications
<PAGE>
THE INVESTMENTS OF UNITED INCOME FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS
Aerospace - 1.06%
Boeing Company (The) ................... 635,000 $ 39,766,875
Airlines - 2.98%
AMR Corporation* ....................... 400,000 29,850,000
Southwest Airlines Co. ................. 2,475,000 59,090,625
USAir Group, Inc.* ..................... 2,000,000 23,250,000
Total ................................. 112,190,625
Automotive - 5.93%
Chrysler Corporation ................... 1,100,000 52,662,500
Dana Corporation ....................... 760,000 21,755,000
Eaton Corporation ...................... 500,000 29,062,500
Ford Motor Company ..................... 1,900,000 56,525,000
General Motors Corporation ............. 1,000,000 46,875,000
Magna International Inc., Class A ...... 376,500 16,613,063
Total ................................. 223,493,063
Banks and Savings and Loans - 3.21%
Citicorp ............................... 750,000 43,406,250
First Bank Systems, Inc. ............... 500,000 20,500,000
First Interstate Bancorp ............... 300,000 24,075,000
Midlantic Corporation .................. 400,000 15,950,000
Skandia Enskilda Banken, Class A (D) ... 3,300,000 17,124,030
Total ................................. 121,055,280
Beverages - 1.21%
PepsiCo, Inc. .......................... 1,000,000 45,625,000
Biotechnology and Medical Services - 0.89%
Centocor, Inc.* ........................ 200,000 2,875,000
Medtronic, Inc. ........................ 400,000 30,850,000
Total ................................. 33,725,000
Building - 4.25%
Armstrong World Industries, Inc. ....... 900,000 45,112,500
Georgia-Pacific Corporation ............ 425,000 36,868,750
Louisiana-Pacific Corporation .......... 1,000,000 26,250,000
Temple-Inland Inc. ..................... 350,000 16,668,750
Weyerhaeuser Company ................... 750,000 35,343,750
Total ................................. 160,243,750
Chemicals Major - 6.87%
Air Products and Chemicals, Inc. ....... 1,150,000 64,112,500
Dow Chemical Company (The) ............. 250,000 17,968,750
du Pont (E.I.) de Nemours and Company .. 1,000,000 68,750,000
PPG Industries, Inc. ................... 1,250,000 53,750,000
Praxair, Inc. .......................... 1,000,000 25,000,000
Union Carbide Corporation .............. 875,000 29,203,125
Total ................................. 258,784,375
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED INCOME FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Chemicals Specialty and Miscellaneous
Technology - 2.39%
Polaroid Corporation ................... 1,400,000 $ 57,050,000
Xerox Corporation ...................... 280,000 32,830,000
Total ................................. 89,880,000
Computers and Office Equipment - 5.25%
Computer Associates International, Inc. 250,000 16,937,500
Digital Equipment Corporation* ......... 400,000 16,300,000
General Motors Corporation, Class E .... 1,081,000 47,023,500
International Business Machines
Corporation ........................... 500,000 48,000,000
Microsoft Corporation* ................. 300,000 27,131,100
Oracle Systems Corporation* ............ 1,100,000 42,418,200
Total ................................. 197,810,300
Consumer Electronics and Appliances - 1.12%
Whirlpool Corporation .................. 765,000 42,075,000
Drugs and Hospital Supply - 1.27%
Astra AB, Class A (D) ................... 300,000 9,245,659
Bristol-Myers Squibb Company ........... 280,000 19,075,000
Merck & Co., Inc. ...................... 400,000 19,600,000
Total ................................. 47,920,659
Electrical Equipment - 2.55%
Emerson Electric Co. ................... 400,000 28,600,000
General Electric Company ............... 1,200,000 67,650,000
Total ................................. 96,250,000
Electronics - 7.13%
AMP Incorporated ....................... 1,100,000 46,475,000
Applied Materials, Inc.* ............... 865,000 74,822,500
cisco Systems, Inc.* ................... 1,000,000 50,562,000
Intel Corporation ...................... 1,530,000 96,867,360
Total ................................. 268,726,860
Engineering and Construction - 1.61%
BBC Brown Boveri Ltd, Series A (D) ..... 25,000 25,835,866
Fluor Corporation ...................... 400,000 20,800,000
Foster Wheeler Corporation ............. 400,000 14,100,000
Total ................................. 60,735,866
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED INCOME FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Financial - 1.98%
Federal Home Loan Mortgage Corporation . 500,000 $ 34,375,000
Federal National Mortgage Association .. 295,200 27,859,500
Grupo Financiero Banamex Accival,
S.A. de C.V., Class B, CPO Shares (D) . 7,800,000 11,806,080
Grupo Financiero Banamex Accival,
S.A. de C.V., Class L (D) ............. 442,500 672,600
Total ................................. 74,713,180
Food and Related - 0.82%
CPC International Inc. ................. 500,000 30,875,000
Hospital Management - 1.53%
Columbia/HCA Healthcare Corporation .... 375,000 16,218,750
Tenet Healthcare Corporation* ......... 1,000,000 14,375,000
United HealthCare Corporation .......... 650,000 26,893,750
Total ................................. 57,487,500
Household Products - 3.49%
Colgate-Palmolive Company .............. 600,000 43,875,000
Gillette Company (The) ................. 1,000,000 44,625,000
Procter & Gamble Company (The) ......... 600,000 43,125,000
Total.................................. 131,625,000
Leisure Time - 2.49%
Walt Disney Company (The) .............. 700,000 38,937,500
McDonald's Corporation ................. 1,400,000 54,775,000
Total ................................. 93,712,500
Machinery - 6.86%
Caterpillar Inc. ....................... 1,600,000 102,800,000
Cooper Industries, Inc. ................ 485,000 19,157,500
Deere & Company ........................ 685,000 58,653,125
Ingersoll-Rand Company ................. 400,000 15,300,000
Mannesmann AG (D) ...................... 65,000 19,854,323
Parker Hannifin Corporation ............ 600,000 21,750,000
Trinova Corporation .................... 600,000 21,000,000
Total ................................. 258,514,948
Multi-Industry - 2.34%
ITT Corporation ........................ 750,204 88,148,970
Packaging and Containers - 0.55%
Pilkington PLC (D) ..................... 7,464,516 20,725,001
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED INCOME FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Paper - 2.68%
Bowater Incorporated ................... 460,000 $ 20,642,500
International Paper Company ............ 600,000 51,450,000
Union Camp Corporation ................. 500,000 28,937,500
Total ................................. 101,030,000
Railroads - 3.05%
CSX Corporation ........................ 350,000 26,293,750
Conrail Inc. ........................... 600,000 33,375,000
Norfolk Southern Corporation ........... 300,000 20,212,500
Southern Pacific Rail Corporation* ..... 460,000 7,245,000
Union Pacific Corporation .............. 500,000 27,687,500
Total ................................. 114,813,750
Retailing - 8.61%
Cifra, S.A. de C.V., Series C (D) ...... 8,000,000 10,496,000
Circuit City Stores, Inc. .............. 1,600,000 50,600,000
Dayton Hudson Corporation .............. 316,600 22,716,050
Gap, Inc. (The) ........................ 700,000 24,412,500
Home Depot, Inc. (The) ................. 765,000 31,078,125
Limited, Inc. (The) .................... 750,000 16,500,000
May Department Stores Company (The) .... 1,000,000 41,625,000
Next plc (D) ........................... 5,100,000 27,711,394
Nordstrom, Inc. ........................ 375,000 15,492,000
Penney (J.C.) Company, Inc. ............ 676,000 32,448,000
Tommy Hilfiger Corporation* ............ 560,000 15,680,000
Toys "R" Us, Inc.* ..................... 300,000 8,775,000
Wal-Mart Stores, Inc. .................. 1,000,000 26,750,000
Total ................................. 324,284,069
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED INCOME FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Steel - 0.43%
Nucor Corporation ...................... 300,000 $ 16,050,000
Telecommunications - 8.57%
AT&T Corporation ....................... 500,000 26,562,500
BellSouth Corporation .................. 315,000 20,002,500
General Instrument Corporation* ........ 1,000,000 38,375,000
General Motors Corporation, Class H .... 176,100 6,955,950
MCI Communications Corporation ......... 1,875,000 41,131,875
Motorola, Inc. ......................... 1,700,000 114,112,500
Telefonaktiebolaget LM Ericsson,
Class B, ADR........................... 2,000,000 40,124,000
Telefonos de Mexico S.A. de C.V., ADR .. 1,200,000 35,550,000
Total ................................. 322,814,325
Tire and Rubber - 1.09%
Goodyear Tire & Rubber Company (The) ... 1,000,000 41,250,000
TOTAL COMMON STOCKS - 92.21% $3,474,326,896
(Cost: $2,127,144,614)
PREFERRED STOCK - 1.18%
Telecommunications
Nokia Corporation (D) ................... 760,000 $ 44,465,247
(Cost: $18,567,891)
Principal
Amount in
Thousands
CORPORATE DEBT SECURITIES
Banks and Savings and Loans - 0.28%
Morgan Guaranty Trust Company of New York,
7.375%, 2-1-2002 ...................... $10,250 10,573,080
Electrical Equipment - 0.30%
General Electric Capital Corporation,
8.3%, 9-20-2009 ....................... 10,000 11,244,000
TOTAL CORPORATE DEBT SECURITIES - 0.58% $ 21,817,080
(Cost: $19,862,480)
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED INCOME FUND
JUNE 30, 1995
Principal
Amount in
Thousands Value
UNITED STATES GOVERNMENT SECURITIES
United States Treasury:
8.5%, 5-15-97 ......................... $16,000 $ 16,735,040
8.75%, 10-15-97 ....................... 20,000 21,212,400
5.75%, 8-15-2003 ...................... 50,000 48,476,500
10.375%, 11-15-2012 ................... 8,500 11,242,610
9.0%, 11-15-2018 ...................... 20,000 25,284,400
TOTAL UNITED STATES GOVERNMENT
SECURITIES - 3.26% $ 122,950,950
(Cost: $113,760,466)
TOTAL SHORT-TERM SECURITIES - 2.52% $ 94,867,273
(Cost: $94,867,273)
TOTAL INVESTMENT SECURITIES - 99.75% $3,758,427,446
(Cost: $2,374,202,724)
CASH AND OTHER ASSETS, NET OF LIABILITIES - 0.25% 9,278,103
NET ASSETS - 100.00% $3,767,705,549
See Notes to Schedules of Investments on page 31.
<PAGE>
SHAREHOLDER SUMMARY
-----------------------------------------------------------------
UNITED ACCUMULATIVE FUND
PORTFOLIO STRATEGY:
Appreciation-oriented OBJECTIVE: Capital growth, with a secondary
common stocks objective of current income.
Cash Reserves
STRATEGY: Invests mainly in common stocks or
securities convertible into common
stocks. (May purchase securities
subject to repurchase agreements. May
invest in certain options and futures.)
The use of cash reserves (often
invested in money market securities)
for defensive purposes is a strategy
that may be utilized by the
Accumulative Fund from time to time.
Moving into cash reserve positions at
times thought to be near a major stock
market peak allows the Fund the
opportunity to capture profits and
attempts to cushion the impact of
market declines. The added flexibility
provided by our CASH RESERVES STRATEGY
has from time to time been an important
element in our past success and, when
deemed appropriate, may be used in the
management of the portfolio in the
future.
FOUNDED: 1940
SCHEDULED DIVIDEND FREQUENCY: SEMIANNUALLY
(JUNE AND DECEMBER)
PERFORMANCE SUMMARY
PER SHARE DATA
For the Six Months Ended June 30, 1995
--------------------------------------
DIVIDEND PAID $0.05
=====
NET ASSET VALUE ON
6/30/95 $7.63
12/31/94 6.58
-----
CHANGE PER SHARE $1.05
=====
Past performance is not necessarily an indication of future results.
TOTAL RETURN HISTORY
Average Annual Total Return
---------------------------
With Without
Period Sales Load* Sales Load**
------ ----------- ------------
1-year period ended 6-30-95 12.75% 19.63%
5-year period ended 6-30-95 8.76% 10.05%
10-year period ended 6-30-95 11.57% 12.24%
*Performance data quoted represents past performance and is based on deduction
of 5.75% sales load on the initial purchase in each of the three periods.
**Performance data quoted in this column represents past performance without
taking into account the sales load deducted on an initial purchase.
Investment return and principal value will fluctuate and an investor's shares,
when redeemed, may be worth more or less than their original cost.
<PAGE>
PORTFOLIO HIGHLIGHTS
On June 30, 1995, United Accumulative Fund had net assets totaling
$1,085,780,051 invested in a diversified portfolio of:
93.14% Common Stocks
6.86% Cash and Cash Equivalents
As a shareholder of United Accumulative Fund, for every $100 you had invested
on June 30, 1995, your Fund owned:
Technological Stocks $42.62
Financial Stocks 18.69
Consumer Stocks 17.13
Basic Industries Stocks 14.70
Cash and Cash Equivalents 6.86
Not all holdings will be represented in the portfolio at all times.
---------------------------------------------------------------------------
These STOCK CATEGORIES are provided as a reference only. Not all categories or
subcategories will be represented in a portfolio at all times. Refer to the
following pages for a more detailed portfolio listing.
BASIC INDUSTRIES
Airlines
Automotive
Building
Chemicals Major
Electrical Equipment
Engineering and Construction
Machinery
Manufacturers
Metals and Mining
Multi-Industry
Paper
Precious Metals
Railroad Equipment
Railroads
Shipping
Steel
Tire and Rubber
Trucking
CONSUMER
Beverages
Consumer Electronics and Appliances
Food and Related
Hospital Management
Household Products
Leisure Time
Packaging and Containers
Publishing and Advertising
Retailing
Services, Consumer and Business
Textiles and Apparel
Tobacco
ENERGY AND ENERGY-RELATED
Canadian Oil
Coal
Domestic Oil
International Oil
Oil Services
Propane
FINANCIAL
Banks and Savings and Loans
Financial
Insurance
PUBLIC UTILITIES
Electric
Gas
Pipelines
TECHNOLOGICAL
Aerospace
Biotechnology and Medical Services
Chemicals Specialty and Miscellaneous Technology
Computers and Office Equipment
Drugs and Hospital Supply
Electronics
Telecommunications
<PAGE>
THE INVESTMENTS OF UNITED ACCUMULATIVE FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS
Banks and Savings and Loans - 10.09%
Ahmanson (H. F.) & Company ............. 300,000 $ 6,600,000
Bank of Boston Corporation ............. 150,000 5,625,000
BankAmerica Corporation ................ 200,000 10,525,000
Barnett Banks, Inc. .................... 150,000 7,687,500
BayBanks, Inc. ......................... 100,000 7,937,500
Chemical Banking Corporation ........... 250,000 11,812,500
City National Corporation .............. 350,000 3,981,250
Crestar Financial Corporation .......... 259,800 12,730,200
First Fidelity Bancorporation .......... 150,000 8,850,000
Great Western Financial Corporation .... 300,000 6,187,500
Mercantile Bancorporation Inc. ......... 300,000 13,462,500
Northern Trust Corporation ............. 150,000 6,000,000
Washington Mutual, Inc. ................ 350,000 8,202,950
Total ................................. 109,601,900
Biotechnology and Medical Services - 1.98%
Biogen, Inc.* .......................... 207,500 9,259,687
Centocor, Inc.* ........................ 700,000 10,062,500
Ventritex, Inc.* ....................... 129,400 2,175,473
Total ................................. 21,497,660
Building - 1.17%
National Health Investors, Inc. ........ 250,000 6,812,500
United Dominion Realty Trust, Inc. ..... 400,000 5,900,000
Total ................................. 12,712,500
Chemicals Major - 1.90%
du Pont (E.I.) de Nemours and
Company .............................. 300,000 20,625,000
Chemicals Specialty and Miscellaneous Technology - 1.89%
Geon Company (The) ..................... 336,200 9,665,750
IMC Global, Inc. ....................... 200,000 10,825,000
Total ................................. 20,490,750
Computers and Office Equipment - 9.87%
Adobe Systems Incorporated ............. 250,000 14,562,500
America Online, Inc.* .................. 250,000 10,937,500
Automatic Data Processing, Inc. ........ 200,000 12,575,000
General Motors Corporation, Class E .... 600,000 26,100,000
HBO & Company .......................... 200,000 10,925,000
Intuit Inc.* ........................... 69,000 5,248,278
NETCOM On-Line Communication
Services, Inc.* ....................... 100,000 2,568,700
Oracle Systems Corporation* ............ 375,000 14,460,750
Seagate Technology, Inc.* ............. 250,000 9,812,500
Total ................................. 107,190,228
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED ACCUMULATIVE FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Drugs and Hospital Supply - 9.03%
Baxter International Inc. ............... 500,000 $ 18,187,500
Bristol-Myers Squibb Company ........... 300,000 20,437,500
Merck & Co., Inc. ...................... 500,000 24,500,000
SmithKline Beecham plc, ADR ............ 325,000 14,706,250
United States Surgical Corporation ..... 350,000 7,306,250
Warner-Lambert Company ................. 150,000 12,956,250
Total ................................. 98,093,750
Electrical Equipment - 1.65%
Emerson Electric Co. ................... 250,000 17,875,000
Electronics - 11.33%
Analog Devices, Inc.* .................. 250,000 8,500,000
Applied Materials, Inc.* ............... 100,000 8,650,000
Cascade Communications Corp.* .......... 150,000 6,468,750
cisco Systems, Inc.* ................... 250,000 12,640,500
Digital Link Corporation* .............. 250,000 7,156,250
Hewlett-Packard Company ................ 150,000 11,175,000
Intel Corporation ...................... 500,000 31,656,000
KEMET Corporation* .................... 93,800 4,936,225
Micron Technology, Inc. ................ 225,000 12,346,875
Silicon Valley Group, Inc.* ............ 200,000 7,262,400
Summa Four, Inc.* ...................... 200,000 5,575,000
Texas Instruments Incorporated ......... 50,000 6,693,750
Total ................................. 123,060,750
Financial - 1.63%
Federal National Mortgage Association .. 100,000 9,437,500
First USA, Inc. ........................ 150,000 6,656,250
Regional Acceptance Corporation* ....... 90,000 1,620,000
Total ................................. 17,713,750
Food and Related - 1.05%
Ralcorp Holdings* ...................... 500,000 11,437,500
Hospital Management - 2.38%
Columbia/HCA Healthcare Corporation .... 300,000 12,975,000
Quorum Health Group, Inc.* ............. 300,000 6,018,600
Sierra Health Services, Inc.* .......... 280,400 6,869,800
Total ................................. 25,863,400
Household Products - 1.27%
Procter & Gamble Company (The) ......... 75,000 5,390,625
Rubbermaid Incorporated ................ 300,000 8,325,000
Total ................................. 13,715,625
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED ACCUMULATIVE FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Insurance - 6.97%
American Re Corporation ................ 120,000 $ 4,470,000
Berkley (W. R.) Corporation ........... 95,000 3,396,250
Chubb Corporation (The) ................ 250,000 20,031,250
First Colony Corporation ............... 500,000 12,000,000
National Re Corporation ................ 282,500 9,463,750
St. Paul Companies, Inc. (The) ......... 300,000 14,775,000
TIG Holdings, Inc. ..................... 500,000 11,500,000
Total ................................. 75,636,250
Leisure Time - 8.61%
Boston Chicken, Inc.* .................. 300,000 7,256,100
Capital Cities/ABC, Inc. ............... 100,000 10,800,000
Comcast Corporation, Class A ........... 1,000,000 18,562,000
Cox Communications, Inc.* .............. 125,000 2,421,875
Tele-Communications, Inc., Class A* .... 725,000 16,991,825
Time Warner Incorporated ............... 300,000 12,337,500
Viacom Inc., Class B* .................. 350,000 16,231,250
Wendy's International, Inc. ............ 500,000 8,937,500
Total ................................. 93,538,050
Multi-Industry - 3.25%
ITT Corporation ........................ 300,000 35,250,000
Paper - 4.72%
Bowater Incorporated ................... 400,000 17,950,000
Champion International Corporation ..... 200,000 10,425,000
James River Corporation of Virginia .... 400,000 11,050,000
Mead Corporation (The)* ................ 200,000 11,875,000
Total ................................. 51,300,000
Publishing and Advertising - 1.04%
News Corporation Limited (The), ADR .... 500,000 11,312,500
Railroads - 2.01%
Conrail Inc. ........................... 250,000 13,906,250
Southern Pacific Rail Corporation* ..... 500,000 7,875,000
Total ................................. 21,781,250
Retailing - 1.83%
Charming Shoppes Inc. .................. 500,000 2,656,000
Family Dollar Stores, Inc. ............. 775,000 11,431,250
Mercantile Stores Company, Inc. ........ 125,000 5,812,500
Total ................................. 19,899,750
Services, Consumer and Business - 0.95%
Block (H & R), Inc. .................... 250,000 10,281,250
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED ACCUMULATIVE FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Telecommunications - 8.52%
AT&T Corporation ....................... 500,000 $ 26,562,500
AirTouch Communications* ............... 400,000 11,400,000
Ascend Communications, Inc.* ........... 150,000 7,593,750
MCI Communications Corporation ......... 700,000 15,355,900
MFS Communications Company, Inc.* ...... 350,000 11,200,000
Nokia Corporation, Series A, ADS ....... 200,000 11,925,000
Ortel Corporation* ..................... 234,800 3,463,300
Scientific-Atlanta, Inc. ............... 225,400 4,958,800
Total ................................. 92,459,250
TOTAL COMMON STOCKS - 93.14% $1,011,336,113
(Cost: $947,147,509)
TOTAL SHORT-TERM SECURITIES - 6.66% $ 72,292,813
(Cost: $72,292,813)
TOTAL INVESTMENT SECURITIES - 99.80% $1,083,628,926
(Cost: $1,019,440,322)
CASH AND OTHER ASSETS, NET OF LIABILITIES - 0.20% 2,151,125
NET ASSETS - 100.00% $1,085,780,051
See Notes to Schedules of Investments on page 31.
<PAGE>
SHAREHOLDER SUMMARY
------------------------------------------------------------------------
UNITED SCIENCE AND TECHNOLOGY FUND
PORTFOLIO STRATEGY:
Technology-related OBJECTIVE: Long-term capital growth.
stocks
Generally at least 80% STRATEGY: Invests in common
in science or technology stocks of companies whose
securities; may have more products, processes or services
than 20% in debt securities. are expected to benefit from
scientific or technological discoveries
or developments. (May purchase
securities subject to repurchase
agreements. May invest in certain
options and futures.)
Cash Reserves The use of cash reserves (often
invested in money market securities)
for defensive purposes is a strategy
that may be utilized by the Science and
Technology Fund from time to time.
Moving into cash reserve positions at
times thought to be near a major stock
market peak allows the Fund the
opportunity to capture profits and
attempts to cushion the impact of
market declines. The added flexibility
provided by our CASH RESERVES STRATEGY
has from time to time been an important
element in our past success and, when
deemed appropriate, may be used in the
management of the portfolio in the
future.
FOUNDED: 1950
SCHEDULED DIVIDEND FREQUENCY: SEMIANNUALLY
(JUNE AND DECEMBER)
PERFORMANCE SUMMARY
PER SHARE DATA
For the Six Months Ended June 30, 1995
--------------------------------------
NET ASSET VALUE ON
6/30/95 $19.46
12/31/94 15.21
------
CHANGE PER SHARE $ 4.25
======
Past performance is not necessarily an indication of future results.
TOTAL RETURN HISTORY
Average Annual Total Return
---------------------------
With Without
Period Sales Load* Sales Load**
------ ----------- ------------
1-year period ended 6-30-95 47.39% 56.38%
5-year period ended 6-30-95 14.93% 16.30%
10-year period ended 6-30-95 16.03% 16.72%
*Performance data quoted represents past performance and is based on deduction
of 5.75% sales load on the initial purchase in each of the three periods.
**Performance data quoted in this column represents past performance without
taking into account the sales load deducted on an initial purchase.
Investment return and principal value will fluctuate and an investor's shares,
when redeemed, may be worth more or less than their original cost.
<PAGE>
PORTFOLIO HIGHLIGHTS
On June 30, 1995, United Science and Technology Fund had net assets totaling
$648,967,059 invested in a diversified portfolio of:
90.16% Common Stocks
9.47% Cash and Cash Equivalents
0.37% Corporate Debt Security
As a shareholder of United Science and Technology Fund, for every $100 you had
invested on June 30, 1995, your Fund owned:
Technological Stocks $74.31
Cash and Cash Equivalents 9.47
Consumer Stocks 8.92
Basic Industries Stocks 6.74
Corporate Debt Security 0.37
Public Utilities Stock 0.19
Not all holdings will be represented in the portfolio at all times.
---------------------------------------------------------------------------
These STOCK CATEGORIES are provided as a reference only. Not all categories or
subcategories will be represented in a portfolio at all times. Refer to the
following pages for a more detailed portfolio listing.
BASIC INDUSTRIES
Airlines
Automotive
Building
Chemicals Major
Electrical Equipment
Engineering and Construction
Machinery
Manufacturers
Metals and Mining
Multi-Industry
Paper
Precious Metals
Railroad Equipment
Railroads
Shipping
Steel
Tire and Rubber
Trucking
CONSUMER
Beverages
Consumer Electronics and Appliances
Food and Related
Hospital Management
Household Products
Leisure Time
Packaging and Containers
Publishing and Advertising
Retailing
Services, Consumer and Business
Textiles and Apparel
Tobacco
ENERGY AND ENERGY-RELATED
Canadian Oil
Coal
Domestic Oil
International Oil
Oil Services
Propane
FINANCIAL
Banks and Savings and Loans
Financial
Insurance
PUBLIC UTILITIES
Electric
Gas
Pipelines
TECHNOLOGICAL
Aerospace
Biotechnology and Medical Services
Chemicals Specialty and Miscellaneous Technology
Computers and Office Equipment
Drugs and Hospital Supply
Electronics
Telecommunications
<PAGE>
THE INVESTMENTS OF UNITED SCIENCE AND TECHNOLOGY FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS
Automotive - 0.88%
AB Volvo (D) ........................... 300,000 $ 5,703,892
Biotechnology and Medical Services - 3.11%
Centocor, Inc.* ........................ 300,000 4,312,500
OmniCare, Inc. ......................... 300,000 8,137,500
Pyxis Corporation* ..................... 200,000 4,512,400
Ventritex, Inc.* ....................... 190,000 3,194,280
Total ................................. 20,156,680
Computers and Office Equipment - 31.58%
Adobe Systems Incorporated ............. 150,000 8,737,500
America Online, Inc.* .................. 270,000 11,812,500
ArcSys, Inc.* ........................... 7,300 250,937
Baan Company N.V. (D)* ................ 40,000 1,235,000
Broderbund Software, Inc.* ............. 233,000 14,824,625
Cerner Corporation* .................... 246,000 14,944,500
Computer Associates International,
Inc. .................................. 150,000 10,162,500
First Data Corporation ................. 150,000 8,531,250
FIserv, Inc.* .......................... 39,300 1,097,924
General Motors Corporation, Class E .... 325,000 14,137,500
HBO & Company .......................... 310,000 16,933,750
HCIA Inc.* ............................. 132,000 4,075,500
Inference Corporation, Class A* ......... 10,000 141,250
Informix Corporation* .................. 910,000 23,033,920
Intuit Inc.* ........................... 50,400 3,833,525
Macromedia, Inc.* ...................... 175,000 7,590,625
Microsoft Corporation* ................. 123,000 11,123,751
National Instruments Corporation* ...... 184,000 3,312,000
Oracle Systems Corporation* ............ 300,000 11,568,600
Parametric Technology Corporation* ..... 400,000 19,850,000
Shiva Corporation* ..................... 121,100 5,207,300
Synopsys, Inc.* ........................ 150,000 9,375,000
UUNET Technologies, Inc.* .............. 80,000 2,200,000
VideoServer, Inc.* ..................... 24,500 952,438
Total ................................. 204,931,895
Drugs and Hospital Supply - 2.13%
Abbott Laboratories .................... 150,000 6,075,000
Roche Holdings AG (D) .................. 1,200 7,742,944
Total ................................. 13,817,944
Electrical Equipment - 1.04%
General Electric Company ............... 120,000 6,765,000
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED SCIENCE AND TECHNOLOGY FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Electronics - 23.11%
Applied Materials, Inc.* ............... 160,000 $ 13,840,000
Atmel Corporation* ..................... 230,000 12,750,510
Cascade Communications Corp.* .......... 310,200 13,377,375
cisco Systems, Inc.* ................... 375,600 18,991,087
Digital Link Corporation* .............. 260,000 7,442,500
KEMET Corporation* ..................... 62,500 3,289,063
LSI Logic Corporation* ................. 290,000 11,346,250
Lam Research* .......................... 200,000 12,775,000
Micron Technology, Inc. ................ 170,000 9,328,750
Summa Four, Inc.* ...................... 250,000 6,968,750
Texas Instruments Incorporated ......... 80,000 10,710,000
3Com Corporation* ...................... 145,000 9,715,000
VLSI Technology, Inc.* ................. 70,000 2,095,590
Xilinx, Inc.* .......................... 185,000 17,366,875
Total ................................. 149,996,750
Engineering and Construction - 0.26%
Grupo Tribasa, S.A. de C.V., ADS* ...... 200,000 1,700,000
Hospital Management - 3.55%
Mid Atlantic Medical Services, Inc.* ... 300,000 5,550,000
PhyCor, Inc.* .......................... 100,000 3,512,500
Sierra Health Services, Inc.* .......... 232,000 5,684,000
United HealthCare Corporation .......... 200,000 8,275,000
Total ................................. 23,021,500
Leisure Time - 0.19%
Grupo Televisa S.A. de C.V., CPO
Shares (D) ............................ 120,000 1,224,960
Machinery - 4.56%
Cognex Corporation* .................... 160,000 6,420,000
Deere & Company ........................ 130,000 11,131,250
Parker Hannifin Corporation ............ 172,050 6,236,812
Trinova Corporation .................... 165,000 5,775,000
Total ................................. 29,563,062
Public Utilities - Electric - 0.19%
Lincoln Electric Company (The),
Class A*............................... 40,000 1,245,000
Services, Consumer and Business - 4.30%
Alternative Resources Corporation* ..... 350,000 9,100,000
Block (H & R), Inc. .................... 100,000 4,112,500
CUC International Inc.* ................ 350,000 14,700,000
Total ................................. 27,912,500
See Notes to Schedules of Investments on page 31.
<PAGE>
THE INVESTMENTS OF UNITED SCIENCE AND TECHNOLOGY FUND
JUNE 30, 1995
Shares Value
COMMON STOCKS (Continued)
Telecommunications - 14.38%
ADC Telecommunications, Inc.* .......... 100,000 $ 3,562,500
Applied Digital Access, Inc.* .......... 50,000 637,500
Ascend Communications, Inc.* ........... 480,000 24,300,000
DSC Communications Corporation* ........ 200,000 9,312,400
General Motors Corporation, Class H .... 110,000 4,345,000
MFS Communications Company, Inc.* ...... 280,000 8,960,000
Motorola, Inc. ......................... 180,000 12,082,500
Nokia Corporation, Series A, ADS ....... 200,000 11,925,000
Ortel Corporation* ..................... 257,000 3,790,750
Tellabs* ............................... 300,000 14,418,600
Total ................................. 93,334,250
Textiles and Apparel - 0.88%
Department 56, Inc.* ................... 150,000 5,737,500
TOTAL COMMON STOCKS - 90.16% $585,110,933
(Cost: $297,811,993)
Principal
Amount in
Thousands
CORPORATE DEBT SECURITY - 0.37%
Financial
American Express Company,
6.25%, 10-15-96 ....................... $1,838 $ 2,425,004
(Cost: $1,837,500)
TOTAL SHORT-TERM SECURITIES - 8.48% $ 54,998,419
(Cost: $54,998,419)
TOTAL INVESTMENT SECURITIES - 99.01% $642,534,356
(Cost: $354,647,912)
CASH AND OTHER ASSETS, NET OF LIABILITIES - 0.99% 6,432,703
NET ASSETS - 100.00% $648,967,059
See Notes to Schedules of Investments on page 31.
<PAGE>
Notes to Schedules of Investments
*No income dividends were paid during the preceding 12 months.
(A) Coupon resets semiannually based on the arithmetic mean of two-year swap
rates in four nations: Italy, France, Spain and the United Kingdom,
determined by the following formula (minimum coupon of 0%): 19.65% - 2 x
(average two-year swap rate in the aforementioned nations).
(B) Coupon resets semiannually based on 14.13% - 1.5 x (5-year Deutschemark
swap rate). Coupon guaranteed at 3%.
(C) Principal amounts are denominated in the indicated foreign currency where
applicable ($A - Australian Dollar).
(D) Listed on an exchange outside the United States.
See Note 1 to financial statements for security valuation and other significant
accounting policies concerning investments.
See Note 3 to financial statements for cost and unrealized appreciation and
depreciation of investments owned for Federal income tax purposes.
<PAGE>
UNITED FUNDS, INC.
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1995
<TABLE>
<CAPTION>
United
United United United Science and
Bond Income Accumulative Technology
Fund Fund Fund Fund
------------ -------------- -------------- ------------
<S> <C> <C> <C> <C>
Assets
Investment securities --
at value (Notes 1 and 3) ... $548,287,080 $3,758,427,446 $1,083,628,926 $642,534,356
Cash ........................ 6,688 128,120 52,226 17,838
Receivables:
Investment securities
sold ...................... 1,656,298 17,507,139 34,663,425 14,187,577
Dividends and interest ..... 8,126,127 7,632,294 1,855,013 296,611
Fund shares sold ........... 152,385 2,672,418 163,886 636,200
Prepaid insurance premium ... 24,654 95,551 49,201 20,084
------------ -------------- -------------- ------------
Total assets ............... 558,253,232 3,786,462,968 1,120,412,677 657,692,666
------------ -------------- -------------- ------------
Liabilities
Payable for investment
securities purchased ....... 5,976,508 9,557,951 31,998,861 5,626,329
Payable for Fund
shares redeemed ............ 1,847,861 7,862,376 2,261,762 2,823,256
Accrued service fee ......... 98,440 671,820 190,574 118,279
Accrued transfer agency
and dividend disbursing .... 58,641 376,451 95,654 90,724
Accrued accounting
services fee ............... 5,833 8,333 8,333 5,833
Other ....................... 41,653 280,488 77,442 61,186
------------ -------------- -------------- ------------
Total liabilities .......... 8,028,936 18,757,419 34,632,626 8,725,607
------------ -------------- -------------- ------------
Total net assets ............. $550,224,296 $3,767,705,549 $1,085,780,051 $648,967,059
============ ============== ============== ============
Net Assets
$1.00 par value capital stock
Capital stock .............. $ 90,183,646 $ 134,692,960 $ 142,278,523 $ 33,345,609
Additional paid-in
capital ................... 479,156,874 2,159,507,254 840,135,982 307,957,644
Accumulated undistributed
income (loss):
Accumulated undistributed net
investment income ......... 683,662 5,706,103 2,560,575 476,503
Accumulated undistributed net
realized gain (loss) on
investment transactions ... (34,897,357) 83,564,062 36,616,325 19,300,743
Net unrealized appreciation
of investments at end
of period ................. 15,097,471 1,384,235,170 64,188,646 287,886,560
------------ -------------- -------------- ------------
Net assets applicable to
outstanding units
of capital .............. $550,224,296 $3,767,705,549 $1,085,780,051 $648,967,059
============ ============== ============== ============
Net asset value per share
(net assets divided by
shares outstanding) ......... $6.10 $27.97 $7.63 $19.46
===== ====== ===== ======
Capital shares
outstanding ................. 90,183,646 134,692,960 142,278,523 33,345,609
Capital shares authorized .... 400,000,000 600,000,000 600,000,000 200,000,000
See notes to financial statements.
</TABLE>
<PAGE>
UNITED FUNDS, INC.
STATEMENT OF OPERATIONS
For the Six Months Ended JUNE 30, 1995
<TABLE>
<CAPTION>
United
United United United Science and
Bond Income Accumulative Technology
Fund Fund Fund Fund
------------ -------------- -------------- ------------
<S> <C> <C> <C> <C>
Investment Income
Income:
Dividends .................. $ --- $ 30,628,283 $ 6,906,895 $ 1,175,793
Interest ................... 19,892,248 9,807,736 5,924,330 1,905,212
------------ -------------- -------------- ------------
Total income .............. 19,892,248 40,436,019 12,831,225 3,081,005
------------ -------------- -------------- ------------
Expenses (Note 2):
Investment
management fee ........... 1,177,931 9,495,749 2,828,459 1,686,059
Transfer agency and
dividend disbursing ....... 380,841 1,954,138 465,497 458,893
Service fee ................ 300,160 1,974,528 545,696 340,610
Custodian fees ............. 10,436 141,302 21,569 12,268
Accounting services fee .... 30,833 50,000 46,250 31,667
Audit fees ................. 10,535 52,061 17,269 9,438
Legal fees ................. 4,226 36,113 22,836 7,344
Other ...................... 43,545 437,263 110,204 58,697
------------ -------------- -------------- ------------
Total expenses ............ 1,958,507 14,141,154 4,057,780 2,604,976
------------ -------------- -------------- ------------
Net investment income .... 17,933,741 26,294,865 8,773,445 476,029
------------ -------------- -------------- ------------
Realized and Unrealized
Gain (Loss) on
Investments
Realized net gain (loss)
on securities .............. (3,367,870) 70,259,984 45,413,607 14,814,650
Realized net gain (loss) on foreign
currency transactions ...... (3,008) (53,706) 1,331 474
------------ -------------- -------------- ------------
Realized net gain (loss)
on investments ............. (3,370,878) 70,206,278 45,414,938 14,815,124
Unrealized appreciation
in value of investments during
the period ................. 47,440,709 549,003,309 103,678,613 125,720,045
------------ -------------- -------------- ------------
Net gain on investments .... 44,069,831 619,209,587 149,093,551 140,535,169
------------ -------------- -------------- ------------
Net increase in net assets
resulting from operations $62,003,572 $645,504,452 $157,866,996 $141,011,198
============ ============== ============== ============
See notes to financial statements.
</TABLE>
<PAGE>
UNITED FUNDS, INC.
STATEMENT OF CHANGES IN NET ASSETS
For the Six Months Ended June 30, 1995
<TABLE>
<CAPTION>
United
United United United Science and
Bond Income Accumulative Technology
Fund Fund Fund Fund
------------ -------------- -------------- ------------
<S> <C> <C> <C> <C>
Increase in Net Assets
Operations:
Net investment income ...... $ 17,933,741 $ 26,294,865 $ 8,773,445 $ 476,029
Realized net gain (loss)
on investments ............ (3,370,878) 70,206,278 45,414,938 14,815,124
Unrealized appreciation .... 47,440,709 549,003,309 103,678,613 125,720,045
------------ -------------- -------------- ------------
Net increase in net assets
resulting from operations 62,003,572 645,504,452 157,866,996 141,011,198
------------ -------------- -------------- ------------
Dividends to shareholders
from net investment
income* .................... (17,995,065) (21,503,248) (7,087,220) ---
------------ -------------- -------------- ------------
Capital share transactions** (11,620,531) (1,199,862) (32,020,024) 11,453,279
------------ -------------- -------------- ------------
Total increase ............. 32,387,976 622,801,342 118,759,752 152,464,477
Net Assets
Beginning of period ......... 517,836,320 3,144,904,207 967,020,299 496,502,582
------------ -------------- -------------- ------------
End of period ............... $550,224,296 $3,767,705,549 $1,085,780,051 $648,967,059
============ ============== ============== ============
Undistributed net
investment income ......... $683,662 $5,706,103 $2,560,575 $476,503
======== ========== ========== ========
*See "Financial Highlights" on pages 36-39.
**Shares issued from sale
of shares ................. 4,259,614 9,431,557 1,737,701 4,445,900
Shares issued from
reinvestment of
dividends ................. 2,584,457 763,484 877,140 ---
Shares redeemed ............ (8,830,295) (10,265,997) (7,275,346) (3,737,340)
--------- ---------- --------- ---------
Increase (decrease) in
outstanding capital
shares .................... (1,986,224) (70,956) (4,660,505) 708,560
========= ====== ========= =======
Value issued from sale
of shares ................. $25,086,920 $244,780,101 $12,157,289 $75,196,331
Value issued from
reinvestment of
dividends ................. 15,072,037 19,645,183 6,527,361 ---
Value redeemed ............. (51,779,488) (265,625,146) (50,704,674) (63,743,052)
----------- ------------ ----------- -----------
Increase (decrease) in
outstanding capital $(11,620,531) $ (1,199,862) $(32,020,024) $11,453,279
============ ============= ============ ===========
See notes to financial statements.
</TABLE>
<PAGE>
UNITED FUNDS, INC.
STATEMENT OF CHANGES IN NET ASSETS
For the Fiscal Year Ended December 31, 1994
<TABLE>
<CAPTION> United
United United United Science and
Bond Income Accumulative Technology
Fund Fund Fund Fund
------------ -------------- -------------- ------------
<S> <C> <C> <C> <C>
Increase (Decrease) in Net Assets
Operations:
Net investment income (loss) $ 37,702,378 $ 45,838,059 $ 17,588,579 $ (18,696)
Realized net gain (loss)
on investments ............ (31,512,111) 89,293,945 60,126,808 37,605,690
Unrealized appreciation
(depreciation) ............ (41,557,487) (195,072,068) (77,231,909) 6,830,120
------------ -------------- -------------- ------------
Net increase (decrease)
in net assets resulting
from operations ............ (35,367,220) (59,940,064) 483,478 44,417,114
------------ -------------- -------------- ------------
Dividends to shareholders:*
From net investment
income .................... (37,265,097) (45,590,722) (17,169,923) ---
From realized net gain on
investment transactions ... (1,836,092) (82,751,883) (65,811,797) (31,199,630)
------------ -------------- -------------- ------------
(39,101,189) (128,342,605) (82,981,720) (31,199,630)
Capital share transactions** (49,363,402) 273,113,600 15,744,243 36,674,458
------------ -------------- -------------- ------------
Total increase (decrease) .... (123,831,811) 84,830,931 (66,753,999) 49,891,942
Net Assets
Beginning of period ......... 641,668,131 3,060,073,276 1,033,774,298 446,610,640
------------ -------------- -------------- ------------
End of period ............... $517,836,320 $3,144,904,207 $ 967,020,299 $496,502,582
============ ============== ============== ============
Undistributed net
investment income .......... $747,994 $968,192 $873,019 $---
======== ======== ======== ====
*See "Financial Highlights" on pages 36-39.
**Shares issued from sale
of shares ................. 6,077,476 17,223,202 4,792,033 4,101,127
Shares issued from
reinvestment of
dividends and/or capital
gains distribution ........ 5,555,134 4,993,419 11,799,943 2,041,497
Shares redeemed ............ (19,918,276) (10,996,133) (13,397,312) (3,619,095)
---------- ---------- ---------- ---------
Increase (decrease) in
outstanding capital
shares .................... (8,285,666) 11,220,488 3,194,664 2,523,529
========= ========== ========= =========
Value issued from sale
of shares ................. $36,518,090 $427,435,360 $34,385,640 $61,082,518
Value issued from
reinvestment of
dividends and/or capital
gains distribution ........ 32,793,687 118,100,262 77,407,382 29,601,725
Value redeemed ............. (118,675,179) (272,422,022) (96,048,779) (54,009,785)
------------ ------------ ----------- -----------
Increase (decrease) in
outstanding capital $(49,363,402) $273,113,600 $15,744,243 $36,674,458
============ ============ =========== ===========
See notes to financial statements.
</TABLE>
<PAGE>
FINANCIAL HIGHLIGHTS OF
UNITED BOND FUND
For a Share of Capital Stock Outstanding Throughout Each Period:
For the
six months For the fiscal year ended December 31,
ended --------------------------------------
6/30/95 1994 1993 1992 1991 1990
---------- ----- ----- ----- ----- -----
Net asset value,
beginning of period $5.62 $6.39 $6.31 $6.32 $5.80 $6.07
---- ---- ---- ---- ---- ----
Income from investment
operations:
Net investment income .20 .39 .41 .45 .47 .50
Net realized and
unrealized gain
(loss) on
investments ..... .48 (0.75) .41 .00 .56 (0.26)
---- ---- ---- ---- ---- ----
Total from investment
operations ....... .68 (0.36) .82 .45 1.03 .24
---- ---- ---- ---- ---- ----
Less distributions:
Dividends from net
investment income (0.20) (0.39) (0.41) (0.46) (0.47) (0.50)
Distribution from
capital gains ... (0.00) (0.02) (0.33) (0.00) (0.04) (0.01)
---- ---- ---- ---- ---- ----
Total distributions (0.20) (0.41) (0.74) (0.46) (0.51) (0.51)
---- ---- ---- ---- ---- ----
Net asset value,
end of period .... $6.10 $5.62 $6.39 $6.31 $6.32 $5.80
===== ===== ===== ===== ===== =====
Total return* ...... 12.28% -5.76% 13.19% 7.50% 18.78% 4.24%
Net assets, end of
period (000
omitted) .........$550,224$517,836$641,668$589,946$524,404$439,487
Ratio of expenses to
average net assets 0.74%** 0.72% 0.65% 0.64% 0.65% 0.67%
Ratio of net investment
income to average
net assets ....... 6.78%** 6.60% 6.14% 7.29% 7.96% 8.54%
Portfolio turnover
rate ............. 52.41%**127.11%175.39%115.17%318.76% 294.66%
*Total return calculated without taking into account the sales load deducted
on an initial purchase.
**Annualized.
See notes to financial statements.
<PAGE>
FINANCIAL HIGHLIGHTS OF
UNITED INCOME FUND
For a Share of Capital Stock Outstanding Throughout Each Period:
For the
six months For the fiscal year ended December 31,
ended --------------------------------------
6/30/95 1994 1993 1992 1991 1990
---------- ----- ----- ----- ----- -----
Net asset value,
beginning of period $23.34 $24.77 $22.05 $20.44 $16.46 $18.69
----- ----- ----- ----- ----- -----
Income from investment
operations:
Net investment income .20 .36 .40 .46 .51 .61
Net realized and
unrealized gain
(loss) on
investments ..... 4.59 (0.80) 3.11 1.96 4.29 (1.61)
----- ---- ---- ---- ---- ----
Total from investment
operations ....... 4.79 (0.44) 3.51 2.42 4.80 (1.00)
----- ---- ---- ---- ---- ----
Less distributions:
Dividends from net
investment income (0.16) (0.36) (0.40) (0.46) (0.53) (0.63)
Distribution from
capital gains ... (0.00) (0.63) (0.39) (0.35) (0.29) (0.60)
----- ---- ---- ---- ---- ----
Total distributions (0.16) (0.99) (0.79) (0.81) (0.82) (1.23)
----- ---- ---- ---- ---- ----
Net asset value,
end of period .... $27.97 $23.34 $24.77 $22.05 $20.44 $16.46
====== ====== ====== ====== ====== ======
Total return* ...... 20.58% -1.82% 16.05% 11.96% 29.64% -5.45%
Net assets, end of
period (000
omitted) .........$3,767,706$3,144,904$3,060,073$2,537,161$2,150,986
$1,578,543
Ratio of expenses to
average net assets 0.84%** 0.74% 0.66% 0.65% 0.66% 0.68%
Ratio of net investment
income to average
net assets ....... 1.56%** 1.45% 1.70% 2.19% 2.71% 3.44%
Portfolio turnover
rate ............. 17.41%**18.54% 21.70% 19.25% 24.68% 30.94%
*Total return calculated without taking into account the sales load deducted
on an initial purchase.
**Annualized.
See notes to financial statements.
<PAGE>
FINANCIAL HIGHLIGHTS OF
UNITED ACCUMULATIVE FUND
For a Share of Capital Stock Outstanding Throughout Each Period:
For the
six months For the fiscal year ended December 31,
ended --------------------------------------
6/30/95 1994 1993 1992 1991 1990
---------- ----- ----- ----- ----- -----
Net asset value,
beginning of period $6.58 $7.19 $7.50 $7.15 $6.03 $7.12
---- ---- ---- ---- ---- ----
Income from investment
operations:
Net investment income .06 .13 .11 .16 .19 .28
Net realized and
unrealized gain
(loss) on
investments ..... 1.04 (0.13) .55 .85 1.22 (0.99)
---- ---- ---- ---- ---- ----
Total from investment
operations ....... 1.10 0.00 .66 1.01 1.41 (0.71)
---- ---- ---- ---- ---- ----
Less distributions:
Dividends from net
investment income (0.05) (0.13) (0.11) (0.16) (0.20) (0.29)
Distribution from
capital gains ... (0.00) (0.48) (0.84) (0.50) (0.09) (0.09)
Distribution in
excess of capital
gains............ 0.00 (0.00) (0.02) (0.00) (0.00) (0.00)
---- ---- ---- ---- ---- ----
Total distributions (0.05) (0.61) (0.97) (0.66) (0.29) (0.38)
---- ---- ---- ---- ---- ----
Net asset value,
end of period .... $7.63 $6.58 $7.19 $7.50 $7.15 $6.03
===== ===== ===== ===== ===== =====
Total return* ...... 16.74% 0.04% 9.06% 14.20% 23.68% -10.17%
Net assets, end of
period (000
omitted) .........$1,085,780$967,020$1,033,774$992,924$904,635$767,218
Ratio of expenses to
average net assets 0.81%** 0.71% 0.65% 0.62% 0.63% 0.64%
Ratio of net investment
income to average
net assets ....... 1.75%** 1.76% 1.34% 2.13% 2.79% 4.12%
Portfolio turnover
rate ............. 213.93%**205.40%230.29%194.41%241.11% 288.64%
*Total return calculated without taking into account the sales load deducted
on an initial purchase.
**Annualized.
See notes to financial statements.
<PAGE>
FINANCIAL HIGHLIGHTS OF
UNITED SCIENCE AND TECHNOLOGY FUND
For a Share of Capital Stock Outstanding Throughout Each Period:
For the
six months For the fiscal year ended December 31,
ended --------------------------------------
6/30/95 1994 1993 1992 1991 1990
---------- ----- ----- ----- ----- -----
Net asset value,
beginning of period $15.21 $14.83 $14.64 $15.42 $10.27 $11.72
------ ------ ------ ------ ------ ------
Income from investment
operations:
Net investment
income .......... .01 .00 .01 .03 .10 .24
Net realized and
unrealized gain
(loss) on
investments ..... 4.24 1.40 1.21 (0.66) 5.90 (0.65)
------ ------ ------ ------ ------ ------
Total from investment
operations ....... 4.25 1.40 1.22 (0.63) 6.00 (0.41)
------ ------ ------ ------ ------ ------
Less distributions:
Dividends from net
investment income (0.00) (0.00) (0.01) (0.03) (0.10) (0.25)
Distribution from
capital gains ... (0.00) (1.02) (0.95) (0.12) (0.75) (0.79)
Distribution in
excess of capital
gains ........... (0.00) (0.00) (0.07) (0.00) (0.00) (0.00)
------ ------ ------ ------ ------ ------
Total distributions (0.00) (1.02) (1.03) (0.15) (0.85) (1.04)
------ ------ ------ ------ ------ ------
Net asset value,
end of period .... $19.46 $15.21 $14.83 $14.64 $15.42 $10.27
====== ====== ====== ====== ====== ======
Total return* ...... 27.94% 9.78% 8.51% -4.03% 59.25% -3.51%
Net assets, end of
period (000
omitted) .........$648,967$496,503$446,611$428,806$405,380$239,077
Ratio of expenses to
average net assets 0.95%** 0.96% 0.91% 0.87% 0.85% 0.90%
Ratio of net investment
income to average
net assets ....... 0.17%** 0.00% 0.06% 0.24% 0.75% 2.06%
Portfolio turnover
rate ............. 45.55%**64.39% 68.38% 45.79% 59.24% 63.86%
*Total return calculated without taking into account the sales load deducted
on an initial purchase.
**Annualized.
See notes to financial statements.
<PAGE>
UNITED FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995
NOTE 1 -- Significant Accounting Policies
United Funds, Inc. (the "Corporation") is registered under the Investment
Company Act of 1940 as a diversified, open-end management investment company.
The Corporation issues four classes of capital shares; each class represents
ownership of a separate mutual fund. The assets belonging to each Fund are
held separately by the Custodian. The capital shares of each Fund represent a
pro rata beneficial interest in the principal, net income and realized and
unrealized capital gains or losses of its respective investments and other
assets. The following is a summary of significant accounting policies
consistently followed by the Corporation in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principles.
A. Security valuation -- Each stock and convertible bond is valued at the
latest sale price thereof on the last business day of the fiscal period as
reported by the principal securities exchange on which the issue is traded
or, if no sale is reported for a stock, the average of the latest bid and
asked prices. Bonds, other than convertible bonds, are valued using a
pricing system provided by a major dealer in bonds. Convertible bonds are
valued using this pricing system only on days when there is no sale
reported. Stocks which are traded over-the-counter are priced using
Nasdaq (National Association of Securities Dealers Automated Quotations)
which provides information on bid and asked or closing prices quoted by
major dealers in such stocks. Securities for which quotations are not
readily available are valued as determined in good faith in accordance
with procedures established by and under the general supervision of the
Corporation's Board of Directors. Short-term debt securities are valued
at amortized cost, which approximates market.
B. Security transactions and related investment income -- Security
transactions are accounted for on the trade date (date the order to buy or
sell is executed). Securities gains and losses are calculated on the
identified cost basis. Original issue discount (as defined in the
Internal Revenue Code), premiums on the purchase of bonds and post-1984
market discount are amortized for both financial and tax reporting
purposes over the remaining lives of the bonds. Dividend income is
recorded on the ex-dividend date except that certain dividends from
foreign securities are recorded as soon as the Corporation is informed of
the ex-dividend date. Interest income is recorded on the accrual basis.
See Note 3 -- Investment Securities Transactions.
C. Foreign currency translations -- All assets and liabilities denominated in
foreign currencies are translated into U.S. dollars daily. Purchases and
sales of investment securities and accruals of income and expenses are
translated at the rate of exchange prevailing on the date of the
transaction. For assets and liabilities other than investments in
securities, net realized and unrealized gains and losses from foreign
currency translations arise from changes in currency exchange rates. The
Corporation combines fluctuations from currency exchange rates and
fluctuations in market value when computing net realized and unrealized
gain or loss from investments.
D. Federal income taxes -- It is the Corporation's policy to distribute all
of its taxable income and capital gains to its shareholders and otherwise
qualify as a regulated investment company under the Internal Revenue Code.
In addition, the Corporation intends to pay distributions as required to
avoid imposition of excise tax. Accordingly, provision has not been made
for Federal income taxes. See Note 4 -- Federal Income Tax Matters.
E. Dividends and distributions -- Dividends and distributions to shareholders
are recorded by each Fund on the record date. Net investment income
distributions and capital gains 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 and post-October losses, foreign
currency transactions, net operating losses and expiring capital loss
carryforwards.
NOTE 2 -- Investment Management And Payments To Affiliated Persons
The Corporation pays a fee for investment management services. The fee is
computed daily based on the net asset value at the close of business. The fee
consists of two elements: (i) a "Specific" fee computed on net asset value as
of the close of business each day at the annual rate of .03% of net assets for
United Bond Fund, .15% of net assets for United Income Fund and United
Accumulative Fund, and .20% for United Science and Technology Fund; and (ii) a
"Group" fee computed each day on the combined net asset values of all of the
funds in the United Group of mutual funds (approximately $12.1 billion of
combined net assets at June 30, 1995) at annual rates of .51% of the first $750
million of combined net assets, .49% on that amount between $750 million and
$1.5 billion, .47% between $1.5 billion and $2.25 billion, .45% between $2.25
billion and $3 billion, .43% between $3 billion and $3.75 billion, .40% between
$3.75 billion and $7.5 billion, .38% between $7.5 billion and $12 billion, and
.36% of that amount over $12 billion. The Corporation accrues and pays this
fee daily.
Pursuant to assignment of the Investment Management Agreement between the
Corporation and Waddell & Reed, Inc. ("W&R"), Waddell & Reed Investment
Management Company ("WRIMCO"), a wholly-owned subsidiary of W&R, serves as the
Corporation's investment manager.
The Corporation has an Accounting Services Agreement with Waddell & Reed
Services Company ("WARSCO"), a wholly-owned subsidiary of W&R. Under the
agreement, WARSCO acts as the agent in providing accounting services and
assistance to the Corporation and pricing daily the value of shares of the
Corporation. For these services, each of the four Funds pays WARSCO a monthly
fee of one-twelfth of the annual fee shown in the following table.
Accounting Services Fee
Average
Net Asset Level Annual Fee
(all dollars in millions) Rate for Each Fund
------------------------- ------------------
From $ 0 to $ 10 $ 0
From $ 10 to $ 25 $ 10,000
From $ 25 to $ 50 $ 20,000
From $ 50 to $ 100 $ 30,000
From $ 100 to $ 200 $ 40,000
From $ 200 to $ 350 $ 50,000
From $ 350 to $ 550 $ 60,000
From $ 550 to $ 750 $ 70,000
From $ 750 to $1,000 $ 85,000
$1,000 and Over $100,000
The Corporation also pays WARSCO a per account charge for transfer agency
and dividend disbursement services of $1.0208 for each shareholder account
which was in existence at any time during the prior month, plus $0.30 for each
account on which a dividend or distribution of cash or shares had a record date
in that month. The Corporation also reimburses W&R and WARSCO for certain out-
of-pocket costs.
As principal underwriter for the Corporation's shares, W&R received direct
and indirect gross sales commissions (which are not an expense of the
Corporation) of $8,512,479, out of which W&R paid sales commissions of
$4,715,186 and all expenses in connection with the sale of the Corporation's
shares, except for registration fees and related expenses.
Under a Service Plan adopted by the Corporation pursuant to Rule 12b-1
under the Investment Company Act of 1940, the Corporation may pay monthly a fee
to W&R in an amount not to exceed .25% of the Corporation's average annual net
assets. The fee is to be paid to reimburse W&R for amounts it expends in
connection with the provision of personal services to Fund shareholders and/or
maintenance of shareholder accounts.
The Corporation paid Directors' fees of $95,259.
W&R is an indirect subsidiary of Torchmark Corporation, a holding company,
and United Investors Management Company, a holding company, and a direct
subsidiary of Waddell & Reed Financial Services, Inc., a holding company.
NOTE 3 -- Investment Securities Transactions
Investment securities transactions for the period ended June 30, 1995 are
summarized as follows:
United
United United United Science and
Bond IncomeAccumulative Technology
Fund Fund Fund Fund
----------- ------------------------ ------------
Purchases of investment
securities, excluding
short-term and U.S.
Government securities $61,833,024 $340,049,846$1,047,069,201$124,222,674
Purchases of U.S. Government
securities 71,265,975 ---- ---- ----
Purchases of short-term
securities 170,452,333 989,782,0481,253,995,459 373,552,685
Proceeds from maturities
and sales of investment
securities, excluding
short-term and U.S.
Government securities 69,628,272 279,812,789 870,133,924 110,683,880
Proceeds from maturities and
sales of U.S. Government
securities 89,892,270 ---- ---- ----
Proceeds from maturities and sales
of short-term securities 150,946,5011,060,321,5401,474,371,634 383,474,847
For Federal income tax purposes, cost of investments owned at June 30,
1995 and the related appreciation (depreciation) were as follows:
Aggregate
Cost AppreciationDepreciation Appreciation
-------------- --------------------------------------
United Bond Fund $533,187,082 $18,628,219$(3,528,221) $15,099,998
United Income Fund 2,374,202,7241,439,241,313(55,016,591) 1,384,224,722
United Accumulative
Fund 1,019,440,322 88,051,980(23,863,376) 64,188,604
United Science and
Technology Fund 354,751,064 298,345,939(10,562,647) 287,783,292
NOTE 4 -- Federal Income Tax Matters
The Corporation's income and expenses attributed to each Fund and the
gains and losses on security transactions of each Fund have been attributed to
that Fund for Federal income tax purposes as well as for accounting purposes.
For Federal income tax purposes, United Income Fund and United Science and
Technology Fund realized capital gain net income of $89,293,944 and
$35,769,799, respectively, during the year ended December 31, 1994. A portion
of the capital gain net income was paid to shareholders during the year ended
December 31, 1994. Remaining capital gain net income will be distributed to
the Fund's shareholders. For Federal income tax purposes, United Accumulative
Fund realized capital gain net income of $65,889,572 during the year ended
December 31,1 994. The capital gain net income was paid to shareholders during
the year ended December 31, 1994. For Federal income tax purposes, United Bond
Fund realized capital losses of $27,347,477 during the year ended December 31,
1994. This amount is available to offset future realized capital gain net
income through December 31, 2002.
Internal Revenue Code regulations permit each Fund to defer into its next
fiscal year net capital losses or net long-term capital losses incurred between
each November 1 and the end of its fiscal year ("post-October losses"). From
November 1, 1994 through December 31, 1994, United Accumulative Fund and United
Bond Fund incurred post-October losses of $8,900,860 and $4,164,635,
respectively, which have been deferred to the fiscal year ending December 31,
1995.
NOTE 5 -- Commencement of Multiclass Operations
On June 17, 1995, each Fund within the Corporation was authorized to offer
investors a choice of two classes of shares, Class A and Class Y. A
comprehensive discussion of the terms under which shares of either class are
offered is contained in the prospectus and the Statement of Additional
Information for the Corporation.
United Income Fund and United Bond Fund commenced multiclass operations on
June 19, 1995. (Neither United Accumulative Fund nor United Science and
Technology Fund had commenced multiclass operations as of June 30, 1995.) The
following class specific information is presented in footnote format in lieu of
presentation in the principal financial statements due to the small amount of
Class Y share transactions during the reporting period:
United Bond Fund
----------------------------------------
Class A Class Y Total
------------ ---------- ------------
Value issued from sale
of shares.......... $23,048,365 $2,038,555 $25,086,920
Value issued from
reinvestment of
dividends ......... 15,072,037 --- 15,072,037
Value redeemed ..... (51,779,488) --- (51,779,488)
----------- ---------- -----------
Increase (decrease) in
outstanding capital $(13,659,086) $2,038,555 $(11,620,531)
============= ============ ============
Shares outstanding . 89,850,004 333,642 90,183,646
Net asset value per share $6.10 $6.10
United Income Fund
----------------------------------------
Class A Class Y Total
------------ ---------- ------------
Value issued from sale
of shares.......... $161,429,495 $83,350,606 $244,780,101
Value issued from
reinvestment of
dividends ......... 19,645,183 --- 19,645,183
Value redeemed ..... (265,561,619) (63,527) (265,625,146)
------------ ---------- ------------
Increase (decrease) in
outstanding capital $( 84,486,941) $83,287,079 $ (1,199,862)
============== ============ =============
Shares outstanding . 131,689,483 3,003,477 134,692,960
Net asset value per share $27.97 $27.97
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
United Funds, Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of each of the four mutual funds
(United Bond Fund, United Income Fund, United Accumulative Fund and United
Science and Technology Fund) comprising United Funds, Inc. (hereafter referred
to as the "Corporation") at June 30, 1995, the results of its operations for
the six months then ended and the changes in its net assets and the financial
highlights for the periods indicated, in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Corporation's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at June 30, 1995 by correspondence with the
custodian and brokers and the application of alternative auditing procedures
where confirmations from brokers were not received, provide a reasonable basis
for the opinion expressed above.
Price Waterhouse LLP
Kansas City, Missouri
August 4, 1995
<PAGE>
To all IRA Planholders:
As required by law, income tax will automatically be withheld from any
distribution or withdrawal from an IRA unless you make a written election not
to have taxes withheld. The election may be made by submitting forms provided
by Waddell & Reed, Inc. which can be obtained from your Waddell & Reed
representative or by submitting Internal Revenue Service form W-4P. Once made,
an election can be revoked by providing written notice to Waddell & Reed, Inc.
If you elect not to have tax withheld you may be required to make payments of
estimated tax. Penalties may be imposed by the IRS if withholding and
estimated tax payments are not adequate.
DIRECTORS
Ronald K. Richey, Birmingham, Alabama, Chairman of the Board
Henry L. Bellmon, Red Rock, Oklahoma
Dodds I. Buchanan, Boulder, Colorado
Jay B. Dillingham, Kansas City, Missouri
Linda Graves, Topeka, Kansas
John F. Hayes, Hutchinson, Kansas
Glendon E. Johnson, Miami, Florida
James B. Judd, Kansas City, Missouri
William T. Morgan, Los Angeles, California
Doyle Patterson, Kansas City, Missouri
Eleanor B. Schwartz, Kansas City, Missouri
Keith A. Tucker, Overland Park, Kansas
Frederick Vogel III, Milwaukee, Wisconsin
Paul S. Wise, Carefree, Arizona
Leslie S. Wright, Birmingham, Alabama
OFFICERS
Keith A. Tucker, President
James C. Cusser, Vice President
Abel Garcia, Vice President
Robert L. Hechler, Vice President
Henry J. Herrmann, Vice President
John M. Holliday, Vice President
Theodore W. Howard, Vice President and Treasurer
Antonio Intagliata, Vice President
Sharon K. Pappas, Vice President and Secretary
Carl E. Sturgeon, Vice President
Russell E. Thompson, Vice President
<PAGE>
THE UNITED GROUP OF MUTUAL FUNDS
-------------------------------------------------------------------
United Cash Management, Inc.
United Government Securities Fund, Inc.
United Bond Fund
United Municipal Bond Fund, Inc.
United Municipal High Income Fund, Inc.
United High Income Fund, Inc.
United High Income Fund II, Inc.
United Continental Income Fund, Inc.
United Retirement Shares, Inc.
United Asset Strategy Fund, Inc.
United Income Fund
United Accumulative Fund
United Vanguard Fund, Inc.
United New Concepts Fund, Inc.
United Science and Technology Fund
United International Growth Fund, Inc.
United Gold & Government Fund, Inc.
------------------------------------
FOR MORE INFORMATION:
Contact your representative, or your
local office as listed on your
Account Statement, or contact:
WADDELL & REED
CUSTOMER SERVICE
6300 Lamar Avenue
P.O. Box 29217
Shawnee Mission, KS 66201-9217
(913) 236-1303
NUR1000SA(6-95)
printed on recycled paper
