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[LOGO]
COLUMBIA FUNDS
1998 SEMI-ANNUAL REPORT
Columbia Common Stock Fund
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Columbia Growth Fund
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Columbia International Stock Fund
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Columbia Special Fund
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Columbia Small Cap Fund
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Columbia Real Estate Equity Fund
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Columbia Balanced Fund
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Columbia Daily Income Company
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Columbia U.S. Government Securities Fund
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Columbia Fixed Income Securities Fund
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Columbia Municipal Bond Fund
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Columbia High Yield Fund
<PAGE>
DEAR COLUMBIA INVESTOR,
We are pleased to present the 1998 Columbia Funds Semi-Annual Shareholder
Report. Included inside are updates to Fund performance and portfolio holdings,
along with summaries of investment activity in the first half of the year.
Preceding the Fund updates is an overview of the economy and financial markets,
which you may find useful when evaluating your investments.
In these times of volatile stock performance, our commitment to careful, quality
investment management remains a priority. We continue to seek opportunities for
above-average returns while managing risk. This report is just one of many ways
in which we attempt to communicate with our shareholders, and we encourage you
to use this information to learn more about how your money is managed at
Columbia. If you have questions, please call one of our Investor Services
Representatives at 1-800-547-1707 or (503) 222-3600 in Portland. E-mail
inquiries may also be sent to [email protected].
As always, we appreciate the trust you have placed in Columbia Funds and look
forward to helping you achieve your investment goals in the months and years to
come.
Sincerely,
[SIGNATURE] [SIGNATURE]
John A. Kemp Thomas L. Thomsen
CHAIRMAN AND CHIEF EXECUTIVE OFFICER PRESIDENT AND CHIEF INVESTMENT OFFICER
COLUMBIA FUNDS MANAGEMENT COMPANY COLUMBIA FUNDS MANAGEMENT COMPANY
FRONT COVER FEATURES A PHOTOGRAPH OF THE 80-YEAR-OLD VISTA HOUSE,
PERCHED ATOP CROWN POINT AT THE MOUTH OF THE COLUMBIA RIVER GORGE.
THE PHOTO WAS TAKEN IN OREGON, LOOKING ACROSS TO WASHINGTON STATE.
<PAGE>
TABLE OF CONTENTS
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SEMI-ANNUAL REPORT, JUNE 30, 1998
AN OVERVIEW OF THE MARKETS.....................................................1
COLUMBIA COMMON STOCK FUND
Investment Review............................................................3
Financial Highlights........................................................15
Schedule of Investments.....................................................27
Statement of Assets and Liabilities.........................................66
Statement of Operations.....................................................69
Statements of Changes in Net Assets.........................................72
COLUMBIA GROWTH FUND
Investment Review............................................................4
Financial Highlights........................................................16
Schedule of Investments.....................................................29
Statement of Assets and Liabilities.........................................66
Statement of Operations.....................................................69
Statements of Changes in Net Assets.........................................72
COLUMBIA INTERNATIONAL STOCK FUND
Investment Review............................................................5
Financial Highlights........................................................17
Schedule of Investments.....................................................31
Statement of Assets and Liabilities.........................................66
Statement of Operations.....................................................69
Statements of Changes in Net Assets.........................................72
COLUMBIA SPECIAL FUND
Investment Review............................................................6
Financial Highlights........................................................18
Schedule of Investments.....................................................35
Statement of Assets and Liabilities.........................................66
Statement of Operations.....................................................69
Statements of Changes in Net Assets.........................................73
COLUMBIA SMALL CAP FUND
Investment Review............................................................7
Financial Highlights........................................................19
Schedule of Investments.....................................................37
Statement of Assets and Liabilities.........................................67
Statement of Operations.....................................................70
Statements of Changes in Net Assets.........................................73
COLUMBIA REAL ESTATE EQUITY FUND
Investment Review............................................................8
Financial Highlights........................................................20
Schedule of Investments.....................................................39
Statement of Assets and Liabilities.........................................67
Statement of Operations.....................................................70
Statements of Changes in Net Assets.........................................73
COLUMBIA BALANCED FUND
Investment Review............................................................9
Financial Highlights........................................................21
Schedule of Investments.....................................................41
Statement of Assets and Liabilities.........................................67
Statement of Operations.....................................................70
Statements of Changes in Net Assets.........................................74
COLUMBIA DAILY INCOME COMPANY
Investment Review...........................................................10
Financial Highlights........................................................22
Schedule of Investments.....................................................47
Statement of Assets and Liabilities.........................................67
Statement of Operations.....................................................70
Statements of Changes in Net Assets.........................................74
COLUMBIA U.S. GOVERNMENT SECURITIES FUND
Investment Review...........................................................11
Financial Highlights........................................................23
Schedule of Investments.....................................................50
Statement of Assets and Liabilities.........................................68
Statement of Operations.....................................................71
Statements of Changes in Net Assets.........................................74
COLUMBIA FIXED INCOME SECURITIES FUND
Investment Review...........................................................12
Financial Highlights........................................................24
Schedule of Investments.....................................................51
Statement of Assets and Liabilities.........................................68
Statement of Operations.....................................................71
Statements of Changes in Net Assets.........................................75
COLUMBIA MUNICIPAL BOND FUND
Investment Review...........................................................13
Financial Highlights........................................................25
Schedule of Investments.....................................................55
Statement of Assets and Liabilities.........................................68
Statement of Operations.....................................................71
Statements of Changes in Net Assets.........................................75
COLUMBIA HIGH YIELD FUND
Investment Review...........................................................14
Financial Highlights........................................................26
Schedule of Investments.....................................................63
Statement of Assets and Liabilities.........................................68
Statement of Operations.....................................................71
Statements of Changes in Net Assets.........................................75
NOTES TO FINANCIAL STATEMENTS.................................................76
COLUMBIA FUNDS
P.O. BOX 1350
PORTLAND, OR 97207-1350
222-3606
1-800-547-1707
WWW.COLUMBIAFUNDS.COM
<PAGE>
AN OVERVIEW OF THE MARKETS
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A LOOK AT THE FIRST HALF
While propelled to new highs during the first half of the year, the stock market
exhibited considerable volatility in the second quarter, amid renewed concerns
about the deepening financial crisis in Asia and expectations for slower
corporate profit growth. In spite of these worries, the S&P 500 rose 17.71% for
the six months ended June 30, 1998. Although the S&P 500 continued to advance,
the breadth of the market deteriorated significantly late in the half, with
large retail, health care, technology, and finance stocks posting the strongest
returns, while REITs, basic material, energy, transportation and utility names,
as well as smaller cap companies, lagged.
Optimism from early in the year was tempered in the second quarter as evidence
began to mount that problems overseas could have a substantial negative impact
on the U.S. economy. By mid-June, the Japanese yen had weakened appreciably.
Fearing that the sliding yen would trigger devaluations in other Asian
currencies, the U.S. and Japanese governments joined forces to intervene in the
currency markets, stabilizing the yen for now. Despite moves by the Japanese
government to reform the financial system, there is unlikely to be a quick fix
for the economic downturn in Japan, and this may hinder a recovery in other
Asian countries.
Europe seems to be a bright spot internationally. Many European companies have
restructured their business operations, cutting costs and increasing profits.
The financial crisis in Russia has little impact on U.S. trade and capital
flows, but much more on European countries. World economic growth is slowing,
which has strong implications for U.S. markets because corporate earnings have
become increasingly dependent on revenues derived from overseas markets. The
financial crisis in Asia has caused a sharp worsening in the trade balance.
This, together with high inventories and a strong dollar, signals potential
earnings trouble for some business sectors. These concerns have contributed to a
lowering of corporate earnings estimates for the second quarter and are expected
to lead to lower estimates for the remainder of 1998 and 1999.
INTERNATIONAL MARKET PERFORMANCE
JANUARY-JUNE 1998
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
France 40.2%
Germany 38.8%
United Kingdom 13.6%
Italy 35.5%
Japan 3.7%
Brazil -5.1%
Mexico -18.1%
Hong Kong -20.3%
Thailand -28.3%
S&P 500 17.7%
Source - Bloomberg
</TABLE>
POSITIVE FACTORS STILL INTACT
Nevertheless, many positive fundamentals remain in place. Although inflationary
pressures in the service sector have risen somewhat and the Consumer Price Index
has moved modestly higher, inflation remains quite low. The Fed is watching
economic indicators closely, but absent any significant change in economic
activity, is widely expected to keep short-term interest rates around current
levels. Long-term rates are near 27-year lows. While corporate earnings growth
is expected to slow, it should remain modestly positive for the year. Apart from
the near-term uncertainty, the crisis in Southeast Asia is having some
stimulative effects in the U.S., with low commodity prices and cheaper imports
contributing to lower inflation. Additionally, foreign investments in the U.S.
financial markets have increased as investors seek a safe haven.
1
<PAGE>
AN OVERVIEW OF THE MARKETS
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CONSUMER PRICE INDEX OVER LAST 30 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Dec-68 4.71
Jan-69 4.69
Feb-69 4.68
Mar-69 5.25
Apr-69 5.52
May-69 5.51
Jun-69 5.48
Jul-69 5.44
Aug-69 5.43
Sep-69 5.7
Oct-69 5.67
Nov-69 5.93
Dec-69 5.9
Jan-70 6.16
Feb-70 6.42
Mar-70 6.09
Apr-70 6.06
May-70 6.04
Jun-70 6.01
Jul-70 5.71
Aug-70 5.69
Sep-70 5.66
Oct-70 5.63
Nov-70 5.6
Dec-70 5.57
Jan-71 5.28
Feb-71 4.72
Mar-71 4.44
Apr-71 4.16
May-71 4.4
Jun-71 4.38
Jul-71 4.37
Aug-71 4.36
Sep-71 4.08
Oct-71 3.81
Nov-71 3.54
Dec-71 3.27
Jan-72 3.26
Feb-72 3.76
Mar-72 3.76
Apr-72 3.5
May-72 3.49
Jun-72 3.23
Jul-72 2.96
Aug-72 2.96
Sep-72 2.95
Oct-72 3.19
Nov-72 3.18
Dec-72 3.41
Jan-73 3.64
Feb-73 3.86
Mar-73 4.83
Apr-73 5.3
May-73 5.53
Jun-73 6
Jul-73 5.74
Aug-73 7.4
Sep-73 7.36
Oct-73 8.06
Nov-73 8.25
Dec-73 8.94
Jan-74 9.6
Feb-74 10
Mar-74 10.14
Apr-74 10.07
May-74 10.71
Jun-74 10.86
Jul-74 11.54
Aug-74 10.89
Sep-74 11.95
Oct-74 11.84
Nov-74 12.2
Dec-74 12.1
Jan-75 11.75
Feb-75 11.21
Mar-75 10.46
Apr-75 10.19
May-75 9.26
Jun-75 9.18
Jul-75 9.53
Aug-75 8.62
Sep-75 7.91
Oct-75 7.65
Nov-75 7.38
Dec-75 7.13
Jan-76 6.69
Feb-76 6.27
Mar-76 6.06
Apr-76 5.85
May-76 6.21
Jun-76 5.98
Jul-76 5.56
Aug-76 5.72
Sep-76 5.49
Oct-76 5.46
Nov-76 5.06
Dec-76 5.04
Jan-77 5.2
Feb-77 6.08
Mar-77 6.43
Apr-77 6.95
May-77 6.74
Jun-77 6.7
Jul-77 6.67
Aug-77 6.63
Sep-77 6.42
Oct-77 6.39
Nov-77 6.71
Dec-77 6.68
Jan-78 6.81
Feb-78 6.24
Mar-78 6.38
Apr-78 6.5
May-78 7.14
Jun-78 7.44
Jul-78 7.73
Aug-78 7.86
Sep-78 8.48
Oct-78 8.93
Nov-78 8.87
Dec-78 8.99
Jan-79 9.25
Feb-79 9.84
Mar-79 10.25
Apr-79 10.49
May-79 10.7
Jun-79 11.08
Jul-79 11.45
Aug-79 11.84
Sep-79 11.88
Oct-79 12.07
Nov-79 12.59
Dec-79 13.25
Jan-80 13.87
Feb-80 14.16
Mar-80 14.59
Apr-80 14.59
May-80 14.43
Jun-80 14.27
Jul-80 13.15
Aug-80 12.89
Sep-80 12.77
Oct-80 12.63
Nov-80 12.63
Dec-80 12.35
Jan-81 11.79
Feb-81 11.39
Mar-81 10.61
Apr-81 10.14
May-81 9.79
Jun-81 9.7
Jul-81 10.77
Aug-81 10.82
Sep-81 10.97
Oct-81 10.27
Nov-81 9.58
Dec-81 8.91
Jan-82 8.26
Feb-82 7.61
Mar-82 6.88
Apr-82 6.62
May-82 6.91
Jun-82 7.18
Jul-82 6.56
Aug-82 5.97
Sep-82 4.94
Oct-82 5.03
Nov-82 4.48
Dec-82 3.83
Jan-83 3.71
Feb-83 3.48
Mar-83 3.59
Apr-83 4
May-83 3.44
Jun-83 2.47
Jul-83 2.36
Aug-83 2.46
Sep-83 2.76
Oct-83 2.75
Nov-83 3.16
Dec-83 3.79
Jan-84 4.29
Feb-84 4.69
Mar-84 4.89
Apr-84 4.55
May-84 4.33
Jun-84 4.33
Jul-84 4.31
Aug-84 4.3
Sep-84 4.28
Oct-84 4.27
Nov-84 4.15
Dec-84 4.04
Jan-85 3.53
Feb-85 3.51
Mar-85 3.69
Apr-85 3.68
May-85 3.67
Jun-85 3.76
Jul-85 3.55
Aug-85 3.35
Sep-85 3.25
Oct-85 3.24
Nov-85 3.61
Dec-85 3.79
Jan-86 3.97
Feb-86 3.2
Mar-86 2.25
Apr-86 1.59
May-86 1.58
Jun-86 1.67
Jul-86 1.58
Aug-86 1.58
Sep-86 1.76
Oct-86 1.57
Nov-86 1.28
Dec-86 1.1
Jan-87 1.46
Feb-87 2.1
Mar-87 3.02
Apr-87 3.77
May-87 3.94
Jun-87 3.84
Jul-87 4.02
Aug-87 4.38
Sep-87 4.18
Oct-87 4.36
Nov-87 4.43
Dec-87 4.43
Jan-88 4.13
Feb-88 3.93
Mar-88 3.83
Apr-88 3.81
May-88 3.88
Jun-88 3.96
Jul-88 4.13
Aug-88 4.02
Sep-88 4.28
Oct-88 4.35
Nov-88 4.25
Dec-88 4.41
Jan-89 4.57
Feb-89 4.82
Mar-89 4.97
Apr-89 5.29
May-89 5.39
Jun-89 5.38
Jul-89 4.95
Aug-89 4.7
Sep-89 4.3
Oct-89 4.6
Nov-89 4.7
Dec-89 4.6
Jan-90 5.2
Feb-90 5.3
Mar-90 5.2
Apr-90 4.7
May-90 4.4
Jun-90 4.7
Jul-90 4.8
Aug-90 5.6
Sep-90 6.2
Oct-90 6.3
Nov-90 6.3
Dec-90 6.1
Jan-91 5.7
Feb-91 5.3
Mar-91 4.9
Apr-91 4.9
May-91 5
Jun-91 4.7
Jul-91 4.4
Aug-91 3.8
Sep-91 3.4
Oct-91 2.9
Nov-91 3
Dec-91 3.1
Jan-92 2.6
Feb-92 2.8
Mar-92 3.2
Apr-92 3.2
May-92 3
Jun-92 3.1
Jul-92 3.2
Aug-92 3.1
Sep-92 2.6
Oct-92 3
Nov-92 3.2
Dec-92 2.9
Jan-93 3.3
Feb-93 3.3
Mar-93 3.1
Apr-93 3.2
May-93 3.2
Jun-93 3
Jul-93 2.8
Aug-93 2.8
Sep-93 2.7
Oct-93 2.7
Nov-93 2.7
Dec-93 2.7
Jan-94 2.5
Feb-94 2.5
Mar-94 2.5
Apr-94 2.4
May-94 2.3
Jun-94 2.5
Jul-94 2.8
Aug-94 2.9
Sep-94 3
Oct-94 2.6
Nov-94 2.7
Dec-94 2.7
Jan-95 2.8
Feb-95 2.9
Mar-95 2.9
Apr-95 3.1
May-95 3.2
Jun-95 3
Jul-95 2.9
Aug-95 2.6
Sep-95 2.5
Oct-95 2.8
Nov-95 2.6
Dec-95 2.5
Jan-96 2.7
Feb-96 2.7
Mar-96 2.8
Apr-96 2.9
May-96 2.9
Jun-96 2.8
Jul-96 3
Aug-96 2.9
Sep-96 3
Oct-96 3
Nov-96 3.3
Dec-96 3.3
Jan-97 3
Feb-97 3
Mar-97 2.8
Apr-97 2.5
May-97 2.2
Jun-97 2.3
Jul-97 2.2
Aug-97 2.2
Sep-97 2.2
Oct-97 2.1
Nov-97 1.8
Dec-97 1.7
Jan-98 1.6
Feb-98 1.4
Mar-98 1.4
Apr-98 1.4
May-98 1.7
Jun-98 1.7
Source - Bloomberg
</TABLE>
FOCUS ON DEPENDABLE GROWTH
Moderating economic growth and substantial risk from events overseas have led us
to emphasize companies with superior earnings growth prospects and lower
vulnerability to negative surprises. We expect larger companies with dominant
competitive positions and earnings derived primarily from the U.S. or Europe to
be most likely to deliver solid growth.
Columbia's focus is on stocks we expect to be favorably influenced by our
current investment themes, in particular, "Aging of America," "Technology Age,"
and continued merger and acquisition activity. The demographic trend of "Aging
of America" favors the health care, financial services and leisure sectors that
sell products to the fastest growing segment of the population. Companies poised
to profit from the "Technology Age" theme include those in the
telecommunications, computer software, networking and internet industries.
Additionally, due to unflagging consumer demand, we have kept the portfolios
overweighted in retail stocks compared to the broader market.
INFLOWS INCREASE TO BOND FUNDS
As stock market volatility and economic uncertainty have increased, inflows to
bond mutual funds have picked up. Although interest rates are at historic lows,
inflation-adjusted yields on bonds (real rates) look attractive, well in excess
of the long-term average. The long-term deflationary trend of prices is expected
to continue, with inflation rising quite modestly this year.
The Treasury's reduced demand for funds, as the federal budget moves into a
surplus, is a long-term positive for the bond market. The surge in corporate
debt issuance so far this year may wane if corporate capital spending declines
on weakening profits. New corporate debt has easily offset the reduced Treasury
offerings year-to-date.
So that you may evaluate how the Columbia Funds have performed given this
economic and financial market backdrop, the following pages contain discussions
of the Funds' investment activity for the six months ending June 30, 1998, along
with graphs illustrating the growth of $10,000 over various time periods. Each
Fund compares its performance to a relevant benchmark. Unlike the Funds,
however, these benchmark indices are not actively managed and have no operating
expenses, porfolio transaction costs or cash flows.
At Columbia, our goal has always been to provide you with the best long-term
returns possible, with an emphasis on managing investment risk. We remain
committed to meeting your financial objectives and we appreciate your continuing
trust.
THE INVESTMENT TEAM
COLUMBIA FUNDS MANAGEMENT COMPANY
AUGUST 1998
2
<PAGE>
INVESTMENT REVIEW
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[LOGO]
- ---------------------------------------------
---------------------------------------------
-- COLUMBIA COMMON STOCK FUND --
--------------------------------
For the six months ended June 30, 1998, Columbia Common Stock Fund had a total
return of 15.68%. While marked by increased volatility, the stock market was
propelled to new highs during the period, fueled by such favorable conditions as
low inflation, moderate economic growth and low interest rates. In this
environment, there were some sectors that experienced better earnings growth
than the broader market, including technology, consumer cyclical and staple
stocks. Our continued emphasis in these areas, as well as in stocks with
consistent earnings growth, benefited Fund performance during the period.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
General Electric Co. 3.0
Pfizer, Inc. 2.9
Microsoft Corp. 2.8
Tyco International Ltd. 2.7
American Home Products Corp. 2.1
Coca-Cola Co. 2.0
Warner-Lambert Co. 1.9
Meyer (Fred), Inc. 1.9
Fannie Mae 1.8
Tandy Corp. 1.8
</TABLE>
As of June 30, 1998
As always, investment themes derived from our view of the macroeconomic
environment played a significant role in the portfolio. For example, the "Aging
of America" theme hinges on the changing spending patterns of the maturing Baby
Boom generation. This demographic shift provides a tailwind for companies that
provide products and services to aging Americans.
Another important investment theme is the "Technology Age," which attempts to
capture the long-term changes occurring in technology and related sectors. Our
current strategy is to concentrate on companies poised to profit from corporate
spending priorities in internet/e-commerce, telecommunications deregulation, the
Year 2000 issue and products that satisfy the continuing need for growth and
productivity.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Technology 17.1
Finance 16.6
Health Care 14.2
Consumer Staples 10.8
Consumer Non-Durables 10.0
</TABLE>
As of June 30, 1998
Near term, we anticipate continuing low inflation, with earnings growth becoming
more difficult to attain. This is especially true in light of the uncertainty
associated with the Asian currency crisis. With this in mind, we are bypassing
cyclical stocks in favor of reasonably valued, domestic-oriented companies that
offer more dependable earnings growth prospects.
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA COMMON STOCK FUND S&P 500
<S> <C> <C>
10/1/91 $10,000 $10,000
12/31/91 11,025 10,838
12/31/92 12,126 11,664
12/31/93 14,120 12,840
12/31/94 14,411 13,009
12/31/95 18,855 17,898
12/31/96 22,760 22,007
12/31/97 28,534 29,349
6/30/98 33,003 34,547
Average Annual Total Returns as of June 30, 1998
CCSF S&P 500
1 Year 24.60% 30.17%
5 Years 20.10% 23.08%
Since Inception 19.20% 20.00%
Past Performance is not predictive of future
results.
</TABLE>
3
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INVESTMENT REVIEW
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[LOGO]
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-- COLUMBIA GROWTH FUND --
--------------------------
Amid increased market volatility, Columbia Growth Fund returned 21.55% for the
six months ended June 30, 1998, outperforming the S&P 500, which returned 17.71%
for the same period. The Fund's performance was supported by high returns from
Warnaco, Cisco Systems, Pfizer, and Microsoft, among others. Themes driving
stock selection included a focus on industries that stand to benefit from the
demographic trend of the aging of America and those that are poised to profit
from technological change, including internet commerce.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Cisco Systems, Inc. 3.2
Tyco International Ltd. 3.2
Microsoft Corp. 3.2
Tandy Corp. 2.8
Pfizer, Inc. 2.3
Morgan Stanley, Dean Witter, Discover &
Co. 2.2
Abercrombie & Fitch Co. (Class A) 2.1
Warner-Lambert Co. 2.1
Computer Sciences Corp. 2.0
Warnaco Group, Inc. (Class A) 2.0
</TABLE>
As of June 30, 1998
The trend of lower interest rates has stimulated mortgage refinancing, and a
rise in personal wealth (due to higher stock prices) has increased consumer
spending. Anticipating strength in consumer spending, the Fund increased its
exposure to domestic and consumer issues in late 1997, and this benefited
performance during 1998. Our continuing analysis of the investment environment
has also resulted in an emphasis on health care, consumer staples, retail,
business, and segments of technology and financial stocks.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Technology 19.3
Finance 18.9
Consumer Non-Durables 14.2
Health Care 13.9
Consumer Staples 8.1
</TABLE>
As of June 30, 1998
While renewed concerns about the Asian financial crisis and continued
expectations for slower corporate profit growth contributed to greater market
volatility in the second quarter, many favorable conditions still exist. Strong
cash flows, sound monetary policy, strong balance sheets, low inflation and
falling interest rates all help support continued expansion of the stock market,
the economy and corporate earnings, but at a slower pace.
As always, the Fund seeks long-term capital appreciation by investing primarily
in common stocks believed to offer above average earnings growth.
GROWTH OF $10,000 OVER 20 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA GROWTH FUND S&P 500
<S> <C> <C>
6/30/78 $10,000 $10,000
6/30/79 11,282 11,340
6/30/80 14,176 13,285
6/30/81 19,580 16,010
6/30/82 17,680 14,167
6/30/83 34,434 22,793
6/30/84 28,123 21,722
6/30/85 37,890 28,406
6/30/86 48,862 38,552
6/30/87 56,294 48,240
6/30/88 55,776 44,916
6/30/89 64,650 54,120
6/30/90 75,531 63,033
6/30/91 79,912 67,729
6/30/92 88,327 76,805
6/30/93 108,774 87,273
6/30/94 110,885 88,504
6/30/95 137,075 111,577
6/30/96 174,045 140,598
6/30/97 215,763 189,372
6/30/98 288,510 246,488
Average Annual Total Returns as of June 30, 1998
CGF S&P 500
1 Year 33.70% 30.17%
5 Years 21.54% 23.08%
10 Years 17.86% 18.56%
20 Years 18.30% 17.38%
Past Performance is not predictive of future
results.
</TABLE>
4
<PAGE>
INVESTMENT REVIEW
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[LOGO]
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------------------------------------------
-- COLUMBIA INTERNATIONAL STOCK FUND --
---------------------------------------
For the six months ended June 30, 1998, the Fund posted a total return of
13.07%. After a slow start at the beginning of the year, Columbia International
Stock Fund had a good second quarter, strongly outperforming the FT/S&P
Euro-Pacific Index. During this time, we reduced the Fund's holdings in Japan in
favor of investments in the better performing European markets. This was an
important contributor to performance during the second quarter.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Aegon NV 3.0
Compass Group plc 2.4
Mannesmann AG 2.3
Banco Bilbao Vizcaya SA 2.1
Renault SA 1.9
France Telecom SA (ADR) 1.8
The Bank of Tokyo-Mitsubishi Ltd., ADR 1.7
British Telecommunications plc 1.7
Glaxo Wellcome plc 1.7
Credito Italiano S.P.A. 1.7
</TABLE>
As of June 30, 1998
European markets have been responding well to the impending European Monetary
Union, which will introduce a single currency for all participating countries in
January 1999. Preparation for the EMU has fostered low interest rates and
disciplined fiscal policies, while providing a strong platform for renewed
economic growth in the region. Furthermore, individual investors throughout
Europe are participating in the markets more fully than ever before, taking
advantage of new tax-favored savings programs similar to the American IRA. Most
importantly, economic growth continues to accelerate, and we expect that this
trend will continue to support higher European stock prices for the balance of
the year.
COUNTRIES OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
United Kingdom 23.9
Japan 16.4
France 10.6
Germany 7.4
Spain 7.3
Netherlands 5.8
Italy 4.5
Switzerland 4.0
</TABLE>
As of June 30, 1998
Although the Japanese and Southeast Asian markets experienced surprisingly sharp
gains in the first quarter, continued economic decline in Southeast Asia and
stagnation/deflation in Japan caused emerging markets to retreat dramatically
during the second quarter. Meanwhile, under pressure from other countries, the
Japanese government appears to be preparing legislation to resolve its banking
crisis. With some important policy changes, this depressed market could rebound.
We plan to carefully watch developments unfold, but a relatively low exposure to
Japan seems appropriate for now.
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA INTERNATIONAL STOCK FUND FT/S&P EURO-PAC S&P 500
<S> <C> <C> <C>
10/1/92 $10,000 $10,000 $10,000
12/31/92 $10,060 $9,628 $10,503
12/31/93 $13,417 $12,665 $11,562
12/31/94 $13,086 $13,822 $11,714
12/31/95 $13,760 $15,290 $16,117
12/31/96 $16,042 $16,180 $19,817
12/31/97 $17,882 $16,144 $26,428
6/30/98 $20,218 $18,557 $31,114
Average Annual Total Returns as of June 30, 1998
CISF S&P 500 FT/S&P Euro-Pac
1 Year 7.10% 30.17% 3.65%
5 Years 13.26% 23.08% 9.24%
Since Inception 13.15% 22.03% 11.46%
Past Performance is not predictive of future
results.
</TABLE>
5
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- -------------------------------------------------
-------------------------------------------------
-- COLUMBIA SPECIAL FUND --
---------------------------
While the stock market started the year off sharply, small and mid-cap stocks
gave up some of their early gains during a volatile second quarter. For the six
months ended June 30, 1998, Columbia Special Fund was up 8.64%, compared to
4.93% for the Russell 2000.
Throughout the period, we focused on industries that tend to show consistent
earnings growth, especially those with a domestic orientation and limited
exposure to Asia. This strategy was shaped by our expectations for a
deceleration in corporate profits and increased risk of earnings
disappointments. Business and consumer services, consumer nondurables and
certain health care companies were strong performers during the period, while
REITs vastly underperformed the broader equity market.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
American Stores Co. 4.0
Abercrombie & Fitch Co. (Class A) 3.2
Meyer (Fred), Inc. 2.7
AnnTaylor Stores Corp. 2.7
ESC Medical Systems Ltd. 2.2
Service Corporation Int'l 2.2
Flserv, Inc. 2.2
St. John Knits, Inc. 2.2
ResMed., Inc. 2.1
Furniture Brands International, Inc. 2.0
</TABLE>
As of June 30, 1998
In trading activity, we took profits in a number of apparel retailers and
increased our emphasis on companies that manufacture and sell products for the
home. We believe that a favorable housing market and greater consumer interest
in home furnishings will benefit these stocks. We also increased our holdings in
water-related companies, as more money is being spent to upgrade the quality of
municipal water systems. Also, we increased our holdings in technology, using
the proceeds from the positions we liquidated in the underperforming REIT sector
to fund our technology additions. Finally, we refocused our finance sector
weightings away from regional bank stocks to insurance stocks, which show
potential for having above-market earnings growth.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Consumer Non-Durables 24.4
Business & Consumer
Services 14.5
Health Care 13.2
Consumer Staples 12.7
</TABLE>
As of June 30, 1998
Looking ahead, we believe that the portfolio is well structured for an
enviroment in which economic growth is slowing, profit growth is more difficult
to attain, commodity prices are under pressure, and inflation and interest rates
remain low.
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA SPECIAL FUND S&P 500 RUSSELL 2000
<S> <C> <C> <C>
6/30/88 $10,000 $10,000 $10,000
6/30/89 $13,289 $12,049 $11,280
6/30/90 $15,791 $14,033 $11,624
6/30/91 $15,862 $15,079 $11,767
6/30/92 $18,469 $17,100 $13,480
6/30/93 $23,813 $19,430 $16,985
6/30/94 $25,771 $19,704 $17,724
6/30/95 $31,013 $24,841 $21,288
6/30/96 $39,625 $31,302 $26,374
6/30/97 $43,013 $42,161 $30,681
6/30/98 $48,986 $54,855 $35,745
Average Annual Total Returns as of June 30, 1998
CSF S&P 500 Russell 2000
1 Year 13.88% 30.17% 16.51%
5 Years 15.52% 23.08% 16.05%
10 Years 17.22% 18.56% 13.59%
Past Performance is not predictive of future
results.
</TABLE>
6
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- ------------------------------------------------
------------------------------------------------
-- COLUMBIA SMALL CAP FUND --
-----------------------------
As investors sought increased liquidity in a volatile stock market environment,
small cap stocks lagged larger company issues. For the six months ended June 30,
1998, the Fund had a total return of 8.89%, significantly outperforming its
benchmark index, the Russell 2000 at 4.93% for the same period. This compares to
the S&P 500's total return of 17.71%.
Early in the period, small cap stocks reached new highs, led by companies tied
to the robust U.S. economy. Consumer cyclicals, such as retailers and providers
of leisure products and services were especially strong, as were issues of
certain technology companies, both of which we emphasized during the period. The
Fund also benefited from reduced exposure to energy and energy services, as
falling oil prices weighed heavily on the shares of companies in this sector.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
PMT Services, Inc. 2.3
ESC Medical Systems Ltd. 2.2
Cerner Corp. 2.2
CKE Restaurants, Inc. 2.1
American Management Systems 2.1
Barr Laboratories, Inc. 2.0
Jones Pharma, Inc. 2.0
Williams-Sonoma, Inc. 1.9
Martin Marietta Materials 1.9
Ascend Communications 1.9
</TABLE>
As of June 30, 1998
May ushered in a spate of new worries related to Asia and the prospects for
corporate earnings, causing a downdraft in price/earnings multiples through the
end of the first half of the year. However, there are a number of positive
factors in place that could contribute to improved small cap performance. For
example, earnings growth for small companies is currently quite strong and is
starting to expand relative to the earning forecasts for companies in the S&P
500. Plus, low interest rates and a moderately growing economy tend to benefit
the type of growth stocks we now favor in the Fund, since their earnings are
less dependent on the economic cycle.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Technology 22.5
Health Care 22.0
Business & Consumer Services 11.8
Consumer Non-Durables 10.1
</TABLE>
As of June 30, 1998
As far as the future is concerned, we are focusing on companies that are
expected to deliver above-average earnings growth. We are also evaluating
"cyclical-growth" companies, such as those that manufacture semiconductors, for
signs of a possible recovery in their fundamentals. Overall, we believe that
relative valuations and earnings growth prospects in the small cap market are
attractive based on historical ranges.
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA SMALL CAP FUND RUSSELL 2000
<S> <C> <C>
10/1/96 $10,000 $10,000
12/31/96 $10,762 $10,520
3/31/97 $10,224 $9,976
6/30/97 $12,245 $11,593
9/30/97 $15,021 $13,318
12/31/97 $14,432 $12,872
3/31/98 $16,261 $14,167
6/30/98 $15,715 $13,507
Average Annual Total Returns as of June 30, 1998
CSCF Russell 2000
1 Year 28.34% 16.51%
Since Inception 30.46% 19.34%
Past Performance is not predictive of future
results.
</TABLE>
7
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- ------------------------------------------
------------------------------------------
-- COLUMBIA REAL ESTATE EQUITY FUND --
--------------------------------------
For the six months ended June 30, 1998, Columbia Real Estate Equity Fund had a
total return of -4.34%. That compares to a total return of -5.03% for the
NAREIT Index over the same period.
REITs significantly lagged the broader equity market for the first half of the
year. This underperformance was largely attributable to increasing concerns that
the recent strong earnings growth enjoyed by REITs would slow sharply going
forward, as real estate acquisitions become increasingly expensive and new
development threatens the supply/demand balance for real estate.
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Apartment Investment & Mgmt. Co. (Class
A) 5.3
Equity Office Properties Trust 5.1
Excel Realty Trust, Inc. 4.1
Simon DeBartolo Group, Inc. 4.0
Mack-Cali Realty Corp. 3.8
Vornado Realty Trust 3.8
Cabot Industrial Trust 3.8
Public Storage, Inc. 3.8
Spieker Properties, Inc. 3.4
Security Capital Pacific Trust 3.4
</TABLE>
As of June 30, 1998
Performance in the REIT market was led by the more defensive retail sector,
where strong consumer spending bolstered fundamentals. The high growth office
and lodging sectors lagged during the period -- evidence of investors' concerns
about potential overbuilding and increasing vacancy rates.
Throughout the period, however, we maintained a sizable weighting in the office
sector, believing that the positive prospects for internal growth and industry
consolidation in this sector remain intact.
We believe that the current valuations for REITs reflect an overdiscounting by
investors anticipating slower industry growth. Many REITs, in fact, are now
trading at or below the underlying value of the real estate they own. We believe
that these valuations are attractive and, along with rising dividend growth
rates, may provide the opportunity for better performance in the months ahead.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
Apartments 16.1%
Community Centers 12.1%
Industrial 30.3%
Lodging 1.1%
Manufactured Homes 2.4%
Office 15.8%
Shopping Malls 8.6%
Other 7.2%
Cash 6.4%
as of June 30, 1998
</TABLE>
Our focus going forward will center on companies that can produce growth in a
real estate environment that is reaching the mature stage of its business cycle.
The management of the companies we seek for the portfolio will have demonstrated
the ability to sustain healthy internal growth while adding value through
selective development activity.
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NATIONAL ASSOCIATION OF REAL ESTATE
COLUMBIA REAL ESTATE EQUITY FUND TRUSTS
<S> <C> <C>
4/1/94 $10,000 $10,000
12/31/94 $10,176 $9,978
12/31/95 $11,892 $11,502
12/31/96 $16,446 $15,558
12/31/97 $20,515 $18,710
6/30/98 $19,624 $17,766
Average Annual Total Returns as of June 30, 1998
CREF NAREIT
1 Year 10.15% 8.04%
Since Inception 17.41% 14.66%
Past Performance is not predictive of future
results.
</TABLE>
8
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- ------------------------------------------------
------------------------------------------------
-- COLUMBIA BALANCED FUND --
----------------------------
Columbia Balanced Fund posted a total return of 11.70% for the six months ended
June 30, 1998. During this time, the stock market reached new highs, with the
Dow Jones Industrial Average surpassing the 9000-point mark for the first time
in April, thanks to such favorable conditions as low inflation, moderate
economic growth and low interest rates. In this environment, certain sectors
experienced better earnings growth than the broader market, including
technology, consumer cyclical and staple stocks. Our continued emphasis in these
areas, as well as in stocks with consistent earnings growth prospects, benefited
Fund performance during the period. Lagging sectors, on the other hand, included
REITs, energy and electric and gas utilities.
TOP TEN STOCK HOLDINGS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
General Electric Co. 1.7
Microsoft Corp. 1.6
Tyco International Ltd 1.6
Pfizer, Inc. 1.4
Coca-Cola Co. 1.2
American Home Products 1.2
Warner-Lambert Co. 1.1
Bristol-Myers Squibb Co. 1.0
Service Corp. International 1.0
Tandy Corp. 1.0
</TABLE>
As of June 30, 1998
Because we anticipate continuing low inflation with earnings growth becoming
increasingly difficult to attain, we are avoiding cyclical stocks, which tend to
rise quickly when the economy is on the upswing and fall when the economy turns
down. Instead, we are seeking stocks with reasonable valuations, which offer
more dependable earnings growth.
On the fixed income side of the portfolio, bonds rallied as long-term Treasuries
fell to a low of 5.62%. Although prices on most bonds increased during the
period, corporate and mortgage-backed securities did not go up as much as
Treasuries, presenting an opportunity to increase weightings in these sectors.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
Common Stocks 52.0%
Fixed Income 45.6%
Cash 2.4%
as of June 30, 1998
</TABLE>
While we do not anticipate much change in the low level of bond yields over the
next few months, we believe bond yields will continue to offer value when
compared to the rate of inflation.
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA BALANCED FUND S&P 500 LEHMAN AGGREGATE
<S> <C> <C> <C>
10/1/91 $10,000 $10,000 $10,000
12/31/91 $10,780 $10,838 $10,507
12/31/92 $11,738 $11,664 $11,285
12/31/93 $13,337 $12,840 $12,385
12/31/94 $13,350 $13,009 $12,023
12/31/95 $16,699 $17,898 $14,244
12/31/96 $18,666 $22,007 $14,761
12/31/97 $22,164 $29,349 $16,185
6/30/98 $24,753 $34,547 $16,823
Average Annual Total Returns as of June 30, 1998
CBF S&P 500 Lehman Aggregate
1 Year 19.76% 30.17% 10.54%
5 Years 14.23% 23.08% 6.88%
Since Inception 14.26% 20.00% 7.95%
Past Performance is not predictive of future
results.
</TABLE>
9
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- --------------------------------------------
--------------------------------------------
-- COLUMBIA DAILY INCOME COMPANY --
-----------------------------------
Columbia Daily Income Company posted a total return of 2.52% for the six months
ended June 30, 1998, comparing favorably to the rate of inflation, which was
just .7% during the same period, as measured by the Consumer Price Index. The
seven-day average yield of the Fund rose only slightly during the period,
reflecting the stability of short-term rates right now.
PORTFOLIO HIGHLIGHTS
<TABLE>
<S> <C>
Current Yield 5.05%
Compound Yield 5.18%
Based on the 7 days ended June 30, 1998
Weighted Average Maturity 41.5 days
As of June 30, 1998
</TABLE>
With continued low inflation, the Federal Reserve Board has opted to leave
short-term rates untouched for the past 15 months, despite a steadily growing
economy.
Economic growth has begun to slow, however, which should keep the Fed from
increasing rates in the immediate future. As an example, annualized GDP growth
for the second quarter is expected to slow dramatically from the very brisk pace
of 5.4% reported for the first quarter.
AT THIS TIME, MONEY MARKET YIELDS ARE VERY ATTRACTIVE RELATIVE
TO THE EXPECTED RATE OF INFLATION.
[LOGO]
As always, the Fund invests only in high quality, short-term debt instruments
and maintains a dollar-weighted average maturity of 30 to 50 days, providing a
very liquid, low risk investment.
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA DAILY INCOME COMPANY CONSUMER PRICE INDEX (INFLATION)
<S> <C> <C>
6/30/88 $10,000 $10,000
6/30/89 $10,849 $10,520
6/30/90 $11,742 $11,014
6/30/91 $12,563 $11,532
6/30/92 $13,117 $11,890
6/30/93 $13,464 $12,246
6/30/94 $13,830 $12,552
6/30/95 $14,525 $12,929
6/30/96 $15,274 $13,291
6/30/97 $16,036 $13,597
6/30/98 $16,867 $13,828
Average Annual Total Returns as of June 30, 1998
CDIC CPI
1 Year 5.18% 1.70%
5 Years 4.61% 2.46%
10 Years 5.37% 3.29%
Past Performance is not predictive of future
results.
</TABLE>
10
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- -------------------------------------------
-------------------------------------------
-- U.S. GOVERNMENT SECURITIES FUND --
-------------------------------------
Columbia U.S. Government Securities Fund posted a total return of 2.61% for the
six months ended June 30, 1998. Interest rates across the entire yield curve
declined during the period. The very low level of inflation and expectations for
economic slowing convinced the Federal Reserve to leave short-term interest
rates unchanged. However, this more positive backdrop for the bond market led to
lower rates on short-term Treasuries, and the Fund benefited from some price
appreciation over the period.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
Treasury/Agency Obligations 98.8%
Cash 1.2%
as of June 30, 1998
</TABLE>
Annualized GDP growth for the second quarter is expected to slow dramatically
versus the brisk pace of 5.4% reported for the first quarter. Further economic
slowing could mitigate the need for the Federal Reserve Board to tighten
monetary policy in the near term. In addition, the turmoil in Asia has increased
uncertainty about the prospects for U.S. economic growth, which should also
contribute to stable rates in the near term.
PORTFOLIO HIGHLIGHTS
<TABLE>
<S> <C>
Current Yield 4.76%
</TABLE>
Based on the 30 days ended June 30, 1998
<TABLE>
<S> <C>
Weighted Averages
Duration 1.9 years
Maturity 2.1 years
</TABLE>
As of June 30, 1998
As always, the Fund seeks preservation of capital and income by investing in
direct obligations of the U.S. Government. These securities include Treasury
bills, notes and bonds all having a maturity of three years or less.
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA MERRILL
U.S. LYNCH CONSUMER
GOVERNMENT 1-3 PRICE
SECURITIES TREASURY INDEX
FUND INDEX (INFLATION)
<S> <C> <C> <C>
6/30/88 $10,000 $10,000 $10,000
6/30/89 $10,735 $10,886 $10,520
6/30/90 $11,523 $11,779 $11,014
6/30/91 $12,678 $12,986 $11,532
6/30/92 $14,111 $14,339 $11,890
6/30/93 $15,151 $15,283 $12,246
6/30/94 $15,315 $15,529 $12,552
6/30/95 $16,329 $16,729 $12,929
6/30/96 $17,075 $17,642 $13,291
6/30/97 $18,083 $18,800 $13,597
6/30/98 $19,157 $20,078 $13,828
Average Annual Total Returns as of June 30, 1998
CUSG Merrill 1-3
1 Year 5.95% 6.81%
5 Years 4.81% 5.61%
10 Years 6.72% 7.22%
Past Performance is not predictive of future
results.
</TABLE>
11
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- --------------------------------------------------------------------------------
-- COLUMBIA FIXED INCOME SECURITIES FUND --
-------------------------------------------
The bond market rallied during the first half of the year, as long-term Treasury
yields fell to a low of 5.62%. The strength of the bond market was largely
attributable to a combination of favorable fundamental and technical factors.
Low inflation and moderating economic growth provided a solid backdrop for low
rates. In addition, the expected Federal budget surplus has reduced the
Treasury's need to issue new bonds, thus reducing the overall supply as older
bonds mature. The strong U.S. dollar, relatively high nominal interest rates and
turmoil in Asian markets have prompted investors to favor dollar-denominated
instruments, such as those we hold in the portfolio. For the six months ended
June 30, 1998, Columbia Fixed Income Securities Fund posted a total return of
3.72%.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
Collateralized Mortgage Obligations 43.3%
Corporate Bonds 27.5%
Treasury/Agency Obligations 17.0%
Mortgage Pass-Throughs 6.6%
Asset Backed Securities 3.2%
Cash 2.4%
as of June 30, 1998
</TABLE>
Although prices on most bonds increased during the period, corporates and
mortgages did not go up as much as Treasuries. We believe these sectors
represent value. To capitalize on this buying opportunity, we increased our
weightings in both corporates and mortgages. While we do not anticipate much
change in the low level of bond yields over the next few months, we believe
yields will continue to offer value when compared to the rate of inflation.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO QUALITY
<S> <C>
Treasury/Agency Obligations 56.4%
Aaa 18.1%
Aa 1.6%
A 8.2%
Baa 13.2%
Ba 2.2%
B 0.3%
as of June 30, 1998
As rated by Moody's Investor
Services
</TABLE>
The Fund's credit quality remains high, and the average maturity and duration of
the Fund are 6.3 years and 4.7 years, respectively, which is in line with the
Fund's benchmark, the Lehman Aggregate Bond Index.
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA
FIXED CONSUMER
INCOME PRICE
SECURITIES LEHMAN INDEX
FUND AGGREGATE (INFLATION)
<S> <C> <C> <C>
6/30/88 $10,000 $10,000 $10,000
6/30/89 $11,222 $11,222 $10,520
6/30/90 $12,032 $12,103 $11,014
6/30/91 $13,260 $13,398 $11,532
6/30/92 $15,327 $15,280 $11,890
6/30/93 $17,278 $17,082 $12,246
6/30/94 $16,986 $16,860 $12,552
6/30/95 $19,097 $18,974 $12,929
6/30/96 $20,039 $19,927 $13,291
6/30/97 $21,708 $21,551 $13,597
6/30/98 $23,898 $23,819 $13,828
Average Annual Total Returns as of June 30, 1998
CFIS Lehman Aggregate
1 Year 10.08% 10.54%
5 Years 6.70% 6.88%
10 Years 9.10% 9.07%
Past Performance is not predictive of future
results.
</TABLE>
12
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- --------------------------------------------
--------------------------------------------
-- COLUMBIA MUNICIPAL BOND FUND --
----------------------------------
Columbia Municipal Bond Fund's total return for the six months ended June 30,
1998 was 2.09%. Overall, municipal securities have tended to underperform the
broader fixed income market as the national supply of municipal bonds has
continued to exceed demand. The outlook improved in the second quarter, however,
as yields on national municipal securities fell on declining interest rates,
although not as much as Treasury bond yields. This makes the price of municipal
bonds look relatively attractive on a historical basis (when yields fall, prices
rise) compared to taxable bonds and inflation.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO COMPOSITION
<S> <C>
State of Oregon General Obligations 8.1%
Oregon General Obligation Bonds 18.6%
Oregon Revenue Bonds 15.4%
Oregon Other Bonds 2.9%
Other Bonds 7.8%
Oregon Insured Bonds 40.2%
Oregon Pre-Refunded Bonds 5.6%
Cash 1.4%
as of June 30, 1998
</TABLE>
The Oregon economy remains healthy, and increasing income growth in the last few
years has led to strong demand for municipal bonds within the State. Unlike the
national municipal market, the supply of new bonds in Oregon has been muted so
far this year. However, the number of new issues may increase if interest rates
stay at these low levels or fall further, prompting refinancing of existing
debt.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO QUALITY
<S> <C>
Aaa 56.0%
Aa 24.2%
A 13.2%
Baa 1.2%
Not Rated 5.4%
as of June 30, 1998
As rated by Moody's Investors Services,
Inc.
</TABLE>
As always, the Fund maintains a high average credit quality and is broadly
diversified across issuers within the State. We remain committed to providing
shareholders with high, after-tax returns and a low level of both volatility and
risk.
GROWTH OF $10,000 OVER 10 YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA LEHMAN CONSUMER
MUNICIPAL GENERAL PRICE
BOND OBLIGATION INDEX
FUND BOND (INFLATION)
<S> <C> <C> <C>
6/30/88 $10,000 $10,000 $10,000
6/30/89 $11,051 $10,938 $10,520
6/30/90 $11,607 $11,670 $11,014
6/30/91 $12,634 $12,636 $11,532
6/30/92 $13,838 $14,060 $11,890
6/30/93 $15,342 $15,701 $12,246
6/30/94 $15,256 $15,794 $12,552
6/30/95 $16,353 $17,092 $12,929
6/30/96 $17,269 $18,194 $13,291
6/30/97 $18,497 $19,701 $13,597
6/30/98 $19,913 $21,320 $13,828
Average Annual Total Returns as of June 30, 1998
CMBF Lehman G.O.
1 Year 7.67% 8.20%
5 Years 5.35% 6.31%
10 Years 7.13% 7.86%
Past Performance is not predictive of future
results.
</TABLE>
13
<PAGE>
INVESTMENT REVIEW
- --------------------------------------------------------------------------------
[LOGO]
- -----------------------------------------------
-----------------------------------------------
-- COLUMBIA HIGH YIELD FUND --
------------------------------
Columbia High Yield Fund provided a total return of 4.45% during the six months
ended June 30, 1998. After a strong first quarter, high yield bonds struggled a
bit in the second quarter, as investors became increasingly concerned about the
impact of the Asian crisis on U.S. economic growth and corporate earnings. In
addition, high yield bonds were negatively impacted by the large supply of new
deals brought to market during the second quarter. This environment prompted a
flight to quality within the high yield market and increased the demand for junk
bonds with higher credit ratings. This benefited Fund performance, due to our
focus on higher quality issues in the high yield market.
SECTORS OF EMPHASIS
<TABLE>
<CAPTION>
% of Net Assets
<S> <C>
Entertainment & Media 24.6%
Manufacturing 15.0%
Health Care 8.0%
Energy 6.8%
Business & Consumer Services 6.1%
</TABLE>
As of June 30, 1998
As corporate prices fluctuated throughout the period, we found attractive
investment opportunities in several new issues. In early 1998, we purchased
holdings in the aerospace sector. We believe the long-term prospects for the
aerospace industry are favorable due to stronger demand for new aircraft and
parts, as airline fleets around the world age and airline travel increases.
We also purchased positions in the cable industry, based on several positive
developments. Many cable companies are paying down their debt, clustering their
systems, and upgrading the quality and capacity of plants and equipment -- while
adding new services.
Despite the expected slowdown in economic growth, the supply of new high yield
bonds is expected to remain robust. With little concern about a recession,
however, we believe that high yield bonds will perform reasonably well in the
near term because of reduced risk of default and increasing demand for high
yield bonds among both retail and institutional investors. For many, investing
in higher quality junk bonds provides an efficient way to increase the yield of
a fixed income portfolio while adding an acceptable level of risk.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PORTFOLIO QUALITY
<S> <C>
Ba 42.4%
B 57.6%
as of June 30, 1998
As rated by Moody's Investor Services,
Inc.
</TABLE>
The Fund's average effective maturity remains steady at 5.1 years. The Fund's
duration averaged 4.32 years during the period.
GROWTH OF $10,000 SINCE INCEPTION
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COLUMBIA HIGH YIELD FUND SALOMON BB LIPPER HIGH YIELD BOND FUND INDEX
<S> <C> <C> <C>
10/1/93 $10,000 $10,000 $10,000
12/31/93 $10,112 $10,185 $10,498
12/31/94 $10,019 $10,048 $10,113
12/31/95 $11,935 $12,321 $11,870
12/31/96 $13,060 $13,429 $13,373
12/31/97 $14,719 $15,142 $15,136
6/30/98 $15,372 $15,821 $15,859
Average Annual Total Returns as of June 30, 1998
CHYF Salomon BB Lipper HYBF
1 Year 11.23% 11.71% 12.11%
Since Inception 9.58% 10.25% 10.31%
Past Performance is not predictive of future
results.
</TABLE>
14
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA COMMON STOCK FUND, INC. --
--------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $22.02 $19.26 $18.59 $15.16 $15.29 $14.04
- ---------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....... .09 .29 .25 .26 .27 .22
Net realized and unrealized
gains on investments...... 3.36 4.58 3.61 4.38 .04 2.08
- ---------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. 3.45 4.87 3.86 4.64 .31 2.30
- ---------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.08) (.27) (.23) (.26) (.25) (.21)
Distributions (from capital
gains).................... (1.84) (2.96) (.95) (.19) (.84)
- ---------------------------------------------------------------------------------------------------------------------------------
Total distributions....... (.08) (2.11) (3.19) (1.21) (.44) (1.05)
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $25.39 $22.02 $19.26 $18.59 $15.16 $15.29
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 15.68%(2) 25.37% 20.71% 30.84% 2.06% 16.44%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $921,259 $783,906 $536,760 $358,523 $124,263 $100,715
Ratio of expenses to average
net assets.................. 0.76% 0.77% 0.76% 0.80% 0.84% 0.84%
Ratio of net investment income
to average net assets....... 0.74% 1.37% 1.32% 1.68% 1.82% 1.48%
Portfolio turnover rate....... 157.34% 90.23% 111.39% 75.36% 64.21% 90.90%
Average commission rate paid
on portfolio transactions
(3)......................... $0.0597 $0.0601 $0.0601
</TABLE>
(1) Ratios and portfolio turnover rate are annualized.
(2) Not annualized.
(3) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
15
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA GROWTH FUND, INC. --
--------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $34.34 $30.74 $29.84 $24.84 $26.38 $26.18
- --------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....... .05 .19 .19 .31 .29 .16
Net realized and unrealized
gains (losses) on
investments............... 7.35 7.90 6.04 7.86 (.46) 3.24
- --------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. 7.40 8.09 6.23 8.17 (.17) 3.40
- --------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.17) (.17) (.29) (.26) (.18)
Distributions (from capital
gains).................... (4.32) (5.14) (2.87) (1.11) (2.98)
Distributions (in excess of
capital gains)............ (.02) (.01) (.04)
- --------------------------------------------------------------------------------------------------------------------------------
Total distributions....... -- (4.49) (5.33) (3.17) (1.37) (3.20)
- --------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $41.74 $34.34 $30.74 $29.84 $24.84 $26.38
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 21.55%(2) 26.32% 20.80% 32.98% -0.63% 13.01%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $1,690,358 $1,324,918 $1,064,100 $848,731 $591,694 $605,401
Ratio of expenses to average
net assets.................. 0.66% 0.71% 0.71% 0.75% 0.81% 0.82%
Ratio of net investment income
to average net assets....... 0.29% 0.55% 0.63% 1.14% 1.12% 0.66%
Portfolio turnover rate....... 112.84% 95.67% 75.49% 94.73% 79.28% 105.64%
Average commission rate paid
on portfolio transactions
(3)......................... $0.0602 $0.0594 $0.0590
</TABLE>
(1) Ratios and portfolio turnover rate are annualized.
(2) Not annualized.
(3) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
16
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA INTERNATIONAL STOCK FUND, INC. --
---------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $13.70 $13.86 $13.07 $12.43 $12.96 $9.95
- ---------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income
(loss).................... .03 .03 .03 .02 (.02) (.02)
Net realized and unrealized
gains (losses) on
investments and foreign
currency transactions..... 1.76 1.56 2.13 .62 (.30) 3.34
- ---------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. 1.79 1.59 2.16 .64 (.32) 3.32
- ---------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.03)
Dividends (in excess of net
investment income)........ (.20)
Distributions (from capital
gains).................... (1.75) (1.14) (.21) (.31)
- ---------------------------------------------------------------------------------------------------------------------------------
Total distributions....... -- (1.75) (1.37) -- (.21) (.31)
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $15.49 $13.70 $13.86 $13.07 $12.43 $12.96
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 13.07%(2) 11.47% 16.59% 5.15% -2.47% 33.37%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $153,094 $146,281 $125,510 $100,873 $118,484 $73,047
Ratio of expenses to average
net assets.................. 1.49% 1.62% 1.54% 1.54% 1.52% 1.71%
Ratio of net investment income
(loss) to average net
assets...................... 0.42% 0.19% 0.22% 0.15% (0.21)% (0.62)%
Portfolio turnover rate....... 87.56% 121.53% 129.40% 156.09% 138.79% 144.78%
Average commission rate paid
on portfolio transactions
(3)......................... $0.0049 $0.0039 $0.0011
</TABLE>
(1) Ratios and portfolio turnover rate are annualized.
(2) Not annualized.
(3) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
17
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA SPECIAL FUND, INC. --
---------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $20.26 $19.85 $21.44 $18.69 $19.51 $18.79
- ----------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income
(loss).................... .01 .01 (.06) .03 .08 .01
Net realized and unrealized
gains on investments...... 1.74 2.50 2.85 5.45 .36 4.04
- ----------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. 1.75 2.51 2.79 5.48 .44 4.05
- ----------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.02) (.07)
Dividends (in excess of net
investment income)........ (.01)
Distributions (from capital
gains).................... (2.10) (4.38) (2.68) (1.16) (3.32)
Distributions (in excess of
capital gains)............ (.03) (.03)
- ----------------------------------------------------------------------------------------------------------------------------------
Total distributions....... -- (2.10) (4.38) (2.73) (1.26) (3.33)
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $22.01 $20.26 $19.85 $21.44 $18.69 $19.51
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 8.64%(2) 12.64% 13.07% 29.53% 2.29% 21.68%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $1,097,523 $1,249,718 $1,585,284 $1,384,415 $889,526 $772,741
Ratio of expenses to average
net assets.................. 1.00% 0.98% 0.94% 0.98% 1.05% 1.12%
Ratio of net investment income
(loss) to average net
assets...................... 0.06% 0.04% (0.29)% 0.16% 0.40% 0.01%
Portfolio turnover rate....... 144.10% 166.46% 150.07% 182.99% 178.91% 154.68%
Average commission rate paid
on portfolio transactions
(3)......................... $0.0578 $0.0585 $0.0553
</TABLE>
(1) Ratios and portfolio turnover rate are annualized.
(2) Not annualized.
(3) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
18
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA SMALL CAP FUND, INC. --
-----------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996(1)(2)
----- ----------
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $16.65 $12.99 $12.00
- ----------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment loss.................. (.05) (.08)
Net realized and unrealized gains on
investments........................ 1.53 4.51 .99
- ----------------------------------------------------------------------------------------
Total from investment operations... 1.48 4.43 .99
- ----------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Distributions (from capital gains)... (.77)
- ----------------------------------------------------------------------------------------
Total distributions................ -- (.77) --
- ----------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $18.13 $16.65 $12.99
- ----------------------------------------------------------------------------------------
TOTAL RETURN........................... 8.89%(3) 34.10% 7.62%(3)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)........................... $138,750 $96,431 $21,061
Ratio of expenses to average net
assets............................... 1.26% 1.46% 1.61%
Ratio of net investment income (loss)
to average net assets................ (0.70)% (0.81)% 0.00%
Portfolio turnover rate................ 160.28% 171.75% 32.57%
Average commission rate paid on
portfolio transactions (4)........... $0.0551 $0.0564 $0.0546
</TABLE>
(1) Ratios and portfolio turnover rates are annualized.
(2) From inception of operations on September 11, 1996.
(3) Not annualized.
(4) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
19
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA REAL ESTATE EQUITY FUND, INC. --
--------------------------------------------
<TABLE>
<CAPTION>
SIX
MONTHS
ENDED
JUNE 30,
1998
(UNAUDITED)(1) 1997 1996 1995 1994(1)(2)
----- ----- ----- ---------
<S> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD........................... $18.80 $16.16 $12.71 $11.72 $12.00
- ----------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income............ .33 .79 .77 .78 .49
Net realized and unrealized gains
(losses) on investments........ (1.14) 3.15 3.94 1.12 (.27)
- ----------------------------------------------------------------------------------------------
Total from investment
operations................... (.81) 3.94 4.71 1.90 .22
- ----------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net investment
income)........................ (.33) (.62) (.52) (.49) (.31)
Dividends (in excess of net
investment income)............. (.01)
Distributions (from capital
gains)......................... (.48) (.41)
Distributions (in excess of
capital gains)................. (.03) (.12) (.14)
Tax return of capital............ (.17) (.21) (.28) (.18)
- ----------------------------------------------------------------------------------------------
Total distributions............ (.33) (1.30) (1.26) (.91) (.50)
- ----------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $17.66 $18.80 $16.16 $12.71 $11.72
- ----------------------------------------------------------------------------------------------
TOTAL RETURN....................... -4.34%(3) 24.74% 38.30% 16.86% 1.76%(3)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)....................... $171,112 $151,554 $68,073 $21,587 $17,402
Ratio of expenses to average net
assets........................... 0.95% 1.02% 1.06% 1.18% 1.14%
Ratio of net investment income to
average net assets............... 3.78% 4.87% 6.23% 6.71% 6.28%
Portfolio turnover rate............ 11.27% 33.55% 45.82% 53.91% 7.61%
Average commission rate paid on
portfolio transactions (4)....... $0.0607 $0.0588 $0.0594
</TABLE>
(1) Ratios and portfolio turnover rates are annualized.
(2) From inception of operations on March 16, 1994.
(3) Not annualized.
(4) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
20
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA BALANCED FUND, INC. --
----------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $21.42 $20.32 $20.08 $17.28 $17.91 $16.80
- ---------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....... .38 .84 .76 .73 .65 .56
Net realized and unrealized
gains (losses) on
investments............... 2.12 2.92 1.58 3.54 (.64) 1.71
- ---------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. 2.50 3.76 2.34 4.27 .01 2.27
- ---------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.37) (.83) (.76) (.73) (.64) (.56)
Dividends (in excess of net
investment income)........ (.01)
Distributions (from capital
gains).................... (1.83) (1.34) (.74) (.59)
- ---------------------------------------------------------------------------------------------------------------------------------
Total distributions....... (.37) (2.66) (2.10) (1.47) (.64) (1.16)
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $23.55 $21.42 $20.32 $20.08 $17.28 $17.91
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 11.70%(2) 18.74% 11.78% 25.08% 0.10% 13.62%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $941,830 $792,378 $672,593 $486,767 $249,670 $186,589
Ratio of expenses to average
net assets.................. 0.65% 0.68% 0.66% 0.69% 0.72% 0.73%
Ratio of net investment income
to average net assets....... 3.40% 3.83% 3.82% 4.05% 3.82% 3.32%
Portfolio turnover rate....... 134.44% 148.91% 133.21% 108.04% 98.48% 107.60%
Average commission rate paid
on portfolio transactions
(3)......................... $0.0595 $0.0610 $0.0596
</TABLE>
(1) Ratios and portfolio turnover rate are annualized.
(2) Not annualized.
(3) The average commission rate paid by the fund is computed by dividing the
dollar amount of commissions paid during the period by the total number of
shares purchased and sold during the period for which commissions were
charged.
- --------------------------------------------------------------------------------
21
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA DAILY INCOME COMPANY --
-----------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD...................... $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....... .025 .050 .048 .053 .036 .025
- ------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. .025 .050 .048 .053 .036 .025
- ------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.025) (.050) (.048) (.053) (.036) (.025)
- ------------------------------------------------------------------------------------------------------------------------------
Total distributions....... (.025) (.050) (.048) (.053) (.036) (.025)
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 2.52%(2) 5.11% 4.96% 5.49% 3.68% 2.51%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $1,026,375 $1,169,096 $889,800 $800,656 $730,067 $544,500
Ratio of expenses to average
net assets.................. 0.63% 0.63% 0.62% 0.64% 0.70% 0.75%
Ratio of net investment income
to average net assets....... 4.99% 4.99% 4.84% 5.34% 3.68% 2.49%
</TABLE>
(1) Ratios are annualized.
(2) Not annualized.
- --------------------------------------------------------------------------------
22
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA U.S. GOVERNMENT SECURITIES FUND, INC. --
----------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $8.29 $8.24 $8.34 $7.99 $8.36 $8.35
- ---------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....... .19 .41 .41 .45 .37 .32
Net realized and unrealized
gains (losses) on
investments............... .02 .05 (.10) .35 (.37) .17
- ---------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. .21 .46 .31 .80 -- .49
- ---------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.19) (.41) (.41) (.45) (.37) (.32)
Distributions (from capital
gains).................... (.16)
- ---------------------------------------------------------------------------------------------------------------------------------
Total distributions....... (.19) (.41) (.41) (.45) (.37) (.48)
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $8.31 $8.29 $8.24 $8.34 $7.99 $8.36
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 2.61%(2) 5.76% 3.85% 10.21% -0.03% 5.91%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $39,123 $37,837 $40,776 $41,842 $33,512 $35,877
Ratio of expenses to average
net assets.................. 0.86% 0.87% 0.80% 0.79% 0.81% 0.75%
Ratio of net investment income
to average net assets....... 4.65% 4.99% 4.99% 5.45% 4.51% 3.74%
Portfolio turnover rate....... 158.14% 184.43% 179.38% 253.17% 253.80% 254.59%
</TABLE>
(1) Ratios and portfolio turnover rate are annualized.
(2) Not annualized.
- --------------------------------------------------------------------------------
23
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA FIXED INCOME SECURITIES FUND, INC. --
-------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $13.41 $13.08 $13.51 $12.16 $13.44 $13.28
- ---------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....... .42 .85 .85 .88 .83 .85
Net realized and unrealized
gains (losses) on
investments............... .07 .36 (.43) 1.35 (1.28) .52
- ---------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. .49 1.21 .42 2.23 (.45) 1.37
- ---------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.42) (.85) (.85) (.88) (.83) (.85)
Distributions (from capital
gains).................... (.03) (.36)
- ---------------------------------------------------------------------------------------------------------------------------------
Total distributions....... (.42) (.88) (.85) (.88) (.83) (1.21)
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $13.48 $13.41 $13.08 $13.51 $12.16 $13.44
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 3.72%(2) 9.56% 3.37% 18.91% -3.36% 10.47%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $411,536 $381,333 $356,421 $316,259 $252,090 $300,532
Ratio of expenses to average
net assets.................. 0.63% 0.66% 0.64% 0.65% 0.66% 0.66%
Ratio of net investment income
to average net assets....... 6.28% 6.43% 6.53% 6.80% 6.53% 6.14%
Portfolio turnover rate....... 102.43% 196.28% 178.25% 137.41% 139.81% 118.80%
</TABLE>
(1) Ratios and portfolio turnover rate are annualized.
(2) Not annualized.
- --------------------------------------------------------------------------------
24
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA MUNICIPAL BOND FUND, INC. --
----------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $12.47 $12.15 $12.37 $11.48 $12.71 $12.17
- ---------------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....... .29 .60 .61 .63 .64 .66
Net realized and unrealized
gains (losses) on
investments............... (.03) .39 (.16) .96 (1.23) .62
- ---------------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. .26 .99 .45 1.59 (.59) 1.28
- ---------------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income) (2).... (.29) (.60) (.61) (.63) (.64) (.66)
Distributions (from capital
gains).................... (.07) (.06) (.07) (.08)
- ---------------------------------------------------------------------------------------------------------------------------------
Total distributions....... (.29) (.67) (.67) (.70) (.64) (.74)
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $12.44 $12.47 $12.15 $12.37 $11.48 $12.71
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 2.09%(3) 8.36% 3.77% 14.15% -4.68% 10.73%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $417,582 $409,148 $375,667 $383,796 $339,817 $430,367
Ratio of expenses to average
net assets.................. 0.56% 0.57% 0.56% 0.57% 0.57% 0.58%
Ratio of net investment income
to average net assets....... 4.63% 4.87% 5.00% 5.22% 5.36% 5.25%
Portfolio turnover rate....... 18.68% 16.88% 19.03% 21.45% 19.40% 9.92%
</TABLE>
(1) Ratios and portfolio turnover rate are annualized.
(2) 100% exempt from federal taxation.
(3) Not annualized.
- --------------------------------------------------------------------------------
25
<PAGE>
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD
[LOGO]
- ---- ----
-- COLUMBIA HIGH YIELD FUND, INC. --
------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1998
(UNAUDITED)(1) 1997 1996 1995 1994 1993(1)(2)
----- ----- ----- ----- ----------
<S> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF
PERIOD $10.04 $9.94 $9.88 $9.04 $9.94 $10.00
- ----------------------------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....... .38 .81 .81 .82 .80 .18
Net realized and unrealized
gains (losses) on
investments............... .06 .40 .07 .84 (.90) (.06)
- ----------------------------------------------------------------------------------------------------------------------------
Total from investment
operations.............. .44 1.21 .88 1.66 (.10) .12
- ----------------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
Dividends (from net
investment income)........ (.38) (.81) (.81) (.82) (.80) (.18)
Distributions (from capital
gains).................... (.30) (.01)
- ----------------------------------------------------------------------------------------------------------------------------
Total distributions....... (.38) (1.11) (.82) (.82) (.80) (.18)
- ----------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.10 $10.04 $9.94 $9.88 $9.04 $9.94
- ----------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN.................. 4.45%(3) 12.70% 9.43% 19.12% -0.92% 1.12%(3)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
thousands).................. $50,514 $39,278 $28,818 $23,471 $12,834 $5,940
Ratio of expenses to average
net assets (4).............. 0.99% 1.00% 0.93% 1.00% 1.00% 1.00%
Ratio of net investment income
to average net assets....... 7.58% 8.05% 8.29% 8.62% 8.69% 7.30%
Portfolio turnover rate....... 80.97% 124.23% 62.27% 51.60% 36.67% 0.00%
</TABLE>
(1) Ratios and portfolio turnover rates are annualized.
(2) From inception of operations on September 15, 1993.
(3) Not annualized.
(4) The ratio was 1.02% in 1997, 1.00% in 1996, 1.06% in 1995, 1.19% in 1994
and 2.03% in 1993, before voluntary reimbursement.
- --------------------------------------------------------------------------------
26
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- --------------------- ---------------------
-- COLUMBIA COMMON STOCK FUND, INC. --
------
<TABLE>
<CAPTION>
SHARES OR
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
COMMON STOCKS (96.9%)
BUILDING & FORESTRY PRODUCTS (0.9%)
CHAMPION INTERNATIONAL CORP........ 44,200 $ 2,174,087
FORT JAMES CORP.................... 40,700 1,811,150
*OWENS-ILLINOIS, INC................ 98,400 4,403,400
-------------
8,388,637
-------------
BUSINESS & CONSUMER SERVICES (2.0%)
*CENDANT CORP....................... 190,900 3,985,037
SERVICE CORPORATION INT'L.......... 328,100 14,067,288
-------------
18,052,325
-------------
CONSUMER DURABLE (0.6%)
BLACK & DECKER CORP................ 93,700 5,715,700
-------------
CONSUMER NON-DURABLE (10.0%)
*COSTCO COS., INC................... 200,000 12,612,500
DAYTON HUDSON CORP................. 175,100 8,492,350
LOWE'S COS., INC................... 320,000 12,980,000
MATTEL, INC........................ 369,250 15,623,891
MCDONALD'S CORP.................... 154,900 10,688,100
TANDY CORP......................... 312,100 16,560,806
WAL-MART STORES, INC............... 254,800 15,479,100
-------------
92,436,747
-------------
CONSUMER STAPLES (10.8%)
AVON PRODUCTS, INC................. 54,100 4,192,750
COCA-COLA CO....................... 216,000 18,468,000
FORTUNE BRANDS, INC................ 116,000 4,458,750
GILLETTE CO........................ 138,600 7,856,887
*KROGER CO.......................... 150,000 6,431,250
*MEYER (FRED), INC.................. 400,000 17,000,000
PEPSICO, INC....................... 200,000 8,237,500
RITE AID CORP...................... 294,400 11,058,400
*SAFEWAY, INC....................... 312,000 12,694,500
SYSCO CORP......................... 352,300 9,027,688
-------------
99,425,725
-------------
ENERGY (5.6%)
BRITISH PETROLEUM CO. PLC ADR...... 46,900 4,138,925
ELF AQUITANE S.A. ADR.............. 57,300 4,068,300
EXXON CORP......................... 203,900 14,540,619
MOBIL CORP......................... 141,600 10,850,100
ROYAL DUTCH PETROLEUM CO........... 136,500 7,481,906
TEXACO, INC........................ 182,000 10,863,125
-------------
51,942,975
-------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
ENERGY SERVICES (1.7%)
CAMCO INTERNATIONAL, INC........... 60,900 $ 4,742,587
DIAMOND OFFSHORE DRILLING, INC..... 58,500 2,340,000
SCHLUMBERGER LTD................... 35,000 2,390,938
*SMITH INTERNATIONAL, INC........... 64,200 2,234,963
TRANSOCEAN OFFSHORE, INC........... 88,400 3,933,800
-------------
15,642,288
-------------
ENTERTAINMENT & MEDIA (2.1%)
*CHANCELLOR MEDIA CORP.............. 235,200 11,679,150
NEW YORK TIMES CO. (CLASS A)....... 93,700 7,425,725
-------------
19,104,875
-------------
FINANCE (16.6%)
ALLSTATE CORP...................... 60,000 5,493,750
AMERICAN EXPRESS CO................ 100,900 11,502,600
AMERICAN GENERAL CORP.............. 165,500 11,781,531
BANKAMERICA CORP................... 120,000 10,372,500
CHASE MANHATTAN CORP............... 123,600 9,331,800
CHUBB CORP......................... 113,000 9,082,375
CIT GROUP, INC. (CLASS A).......... 150,000 5,625,000
FANNIE MAE......................... 275,000 16,706,250
FIRST CHICAGO NBD CORP............. 79,400 7,036,825
FIRST UNION CORP................... 246,600 14,364,450
MELLON BANK CORP................... 100,000 6,962,500
NATIONSBANK CORP................... 208,100 15,919,650
TRAVELERS GROUP, INC............... 155,000 9,396,875
TRAVELERS PROPERTY CASUALTY CORP.
(CLASS A)......................... 227,800 9,766,925
U.S. BANCORP....................... 222,132 9,551,676
-------------
152,894,707
-------------
HEALTH (14.2%)
AMERICAN HOME PRODUCTS CORP........ 367,000 18,992,250
BECTON, DICKINSON & CO............. 49,000 3,803,625
*BOSTON SCIENTIFIC CORP............. 164,900 11,810,962
BRISTOL-MYERS SQUIBB CO............ 140,000 16,091,250
LILLY (ELI) & CO................... 113,700 7,511,306
MERCK & CO., INC................... 119,000 15,916,250
PFIZER, INC........................ 245,000 26,628,438
SCHERING-PLOUGH CORP............... 139,000 12,735,875
WARNER-LAMBERT CO.................. 248,000 17,205,000
-------------
130,694,956
-------------
MACHINERY & CAPITAL SPENDING (8.0%)
ALLIED SIGNAL, INC................. 300,700 13,343,563
EMERSON ELECTRIC CO................ 128,000 7,728,000
GENERAL ELECTRIC CO................ 300,000 27,300,000
</TABLE>
27
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- --------------------- ---------------------
-- COLUMBIA COMMON STOCK FUND, INC. --
------
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
TYCO INTERNATIONAL LTD............. 396,308 $ 24,967,404
-------------
73,338,967
-------------
POLLUTION CONTROL (1.0%)
*USA WASTE SERVICES, INC............ 155,000 7,653,125
WASTE MANAGEMENT, INC.............. 55,000 1,925,000
-------------
9,578,125
-------------
TECHNOLOGY (17.1%)
AUTOMATIC DATA PROCESSING, INC..... 142,000 10,348,250
*BAY NETWORKS, INC.................. 417,100 13,451,475
*CADENCE DESIGN SYSTEMS, INC........ 288,300 9,009,375
*CISCO SYSTEMS, INC................. 47,000 4,326,937
COMPAQ COMPUTER CORP............... 206,000 5,845,250
COMPUTER ASSOCIATES INTERNATIONAL,
INC............................... 161,300 8,962,231
*COMPUTER SCIENCES CORP............. 245,500 15,712,000
ERICSSON (L.M.) TELEPHONE CO.
(CLASS B) ADR..................... 339,600 9,721,050
*GATEWAY 2000, INC.................. 227,600 11,522,250
INTERNATIONAL BUSINESS MACHINES
CORP.............................. 100,000 11,481,250
LUCENT TECHNOLOGIES, INC........... 159,000 13,226,813
*MICROSOFT CORP..................... 239,800 25,988,325
*STORAGE TECHNOLOGY CORP............ 47,400 2,055,975
*STRUCTURAL DYNAMICS
RESEARCH CORP..................... 286,400 6,623,000
*TELLABS, INC....................... 126,400 9,053,400
-------------
157,327,581
-------------
TRANSPORTATION (0.6%)
*AMR CORP........................... 66,800 5,561,100
-------------
UTILITIES/COMMUNICATIONS (4.4%)
AMERITECH CORP..................... 100,000 4,487,500
AT&T CORP.......................... 40,200 2,296,425
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
BELL ATLANTIC CORP................. 106,800 $ 4,872,750
MCI COMMUNICATIONS CORP............ 69,300 4,028,062
SBC COMMUNICATIONS, INC............ 169,800 6,792,000
SPRINT CORP........................ 59,200 4,173,600
*WORLDCOM, INC...................... 283,700 13,741,719
-------------
40,392,056
-------------
UTILITIES/ELECTRIC/GAS (1.3%)
IDAHO POWER CO..................... 236,600 8,192,275
TEXAS UTILITIES CO................. 100,000 4,162,500
-------------
12,354,775
-------------
TOTAL COMMON STOCKS
(COST $703,693,351)............... 892,851,539
-------------
REPURCHASE AGREEMENT (3.9%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $36,209,493.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023.
(COST $36,203,710)................ $36,203,710 36,203,710
-------------
TOTAL INVESTMENTS (100.8%)
(COST $739,897,061)................... 929,055,249
RECEIVABLES LESS LIABILITIES (-0.8%)... (7,795,824)
-------------
NET ASSETS (100.0%).................... $ 921,259,425
-------------
-------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
28
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- ------------------------- -------------------------
-- COLUMBIA GROWTH FUND, INC. --
------
<TABLE>
<CAPTION>
SHARES OR
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
COMMON STOCKS (97.3%)
BUILDING & FORESTRY PRODUCTS (1.5%)
*OWENS-ILLINOIS, INC................ 555,000 $ 24,836,250
---------------
BUSINESS & CONSUMER SERVICES (5.9%)
*CENDANT CORP....................... 1,101,250 22,988,594
*FISERV, INC........................ 450,750 19,142,789
MCKESSON CORP...................... 297,800 24,196,250
SERVICE CORPORATION INT'L.......... 450,000 19,293,750
SERVICEMASTER CO................... 382,500 14,558,906
---------------
100,180,289
---------------
CONSUMER DURABLE (1.6%)
BLACK & DECKER CORP................ 147,700 9,009,700
FEDERAL-MOGUL CORP................. 250,000 16,875,000
*SONIC AUTOMOTIVE, INC.............. 50,000 821,875
---------------
26,706,575
---------------
CONSUMER NON-DURABLE (14.2%)
*ABERCROMBIE & FITCH CO. (CLASS
A)................................ 805,834 35,456,696
CARNIVAL CORP...................... 500,000 19,812,500
LOWE'S COS., INC................... 454,000 18,415,375
MATTEL, INC........................ 611,700 25,882,556
MCDONALD'S CORP.................... 124,300 8,576,700
*PAYLESS SHOESOURCE, INC............ 400,200 29,489,738
ROYAL CARIBBEAN CRUISES LTD........ 255,000 20,272,500
TANDY CORP......................... 900,000 47,756,250
WARNACO GROUP, INC. (CLASS A)...... 804,000 34,119,750
---------------
239,782,065
---------------
CONSUMER STAPLES (8.1%)
FORTUNE BRANDS, INC................ 400,000 15,375,000
GILLETTE CO........................ 374,200 21,212,462
LIBBEY, INC........................ 292,000 11,187,250
*MEYER (FRED), INC.................. 263,400 11,194,500
RITE AID CORP...................... 901,850 33,875,741
*SAFEWAY, INC....................... 655,400 26,666,588
SYSCO CORP......................... 656,800 16,830,500
---------------
136,342,041
---------------
ENERGY SERVICES (2.2%)
CAMCO INTERNATIONAL, INC........... 300,900 23,432,587
DIAMOND OFFSHORE DRILLING, INC..... 350,000 14,000,000
---------------
37,432,587
---------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
ENTERTAINMENT & MEDIA (1.5%)
*CHANCELLOR MEDIA CORP.............. 300,000 $ 14,896,875
NEW YORK TIMES CO. (CLASS A)....... 142,900 11,324,825
---------------
26,221,700
---------------
FINANCE (18.9%)
ALLSTATE CORP...................... 271,600 24,868,375
AMERICAN GENERAL CORP.............. 361,800 25,755,637
AMERICAN INTERNATIONAL GROUP,
INC............................... 124,225 18,136,850
BANKAMERICA CORP................... 200,000 17,287,500
BANKBOSTON CORP.................... 300,000 16,687,500
CHASE MANHATTAN CORP............... 300,000 22,650,000
CHUBB CORP......................... 84,000 6,751,500
CIT GROUP, INC. (CLASS A).......... 600,000 22,500,000
CITICORP........................... 125,000 18,656,250
FANNIE MAE......................... 456,800 27,750,600
FIRST UNION CORP................... 300,000 17,475,000
FREDDIE MAC........................ 500,700 23,564,194
*HELLER FINANCIAL, INC.............. 350,000 10,500,000
MORGAN STANLEY, DEAN WITTER,
DISCOVER & CO..................... 405,080 37,014,185
NATIONSBANK CORP................... 380,812 29,132,118
---------------
318,729,709
---------------
HEALTH (13.9%)
AMERICAN HOME PRODUCTS CORP........ 623,900 32,286,825
*BOSTON SCIENTIFIC CORP............. 475,400 34,050,525
BRISTOL-MYERS SQUIBB CO............ 244,500 28,102,219
LILLY (ELI) & CO................... 222,100 14,672,481
MEDTRONIC, INC..................... 150,000 9,562,500
MERCK & CO., INC................... 195,600 26,161,500
PFIZER, INC........................ 352,300 38,290,606
SCHERING-PLOUGH CORP............... 186,800 17,115,550
WARNER-LAMBERT CO.................. 501,400 34,784,625
---------------
235,026,831
---------------
MACHINERY & CAPITAL SPENDING (6.9%)
ALLIEDSIGNAL, INC.................. 482,600 21,415,375
EMERSON ELECTRIC CO................ 161,000 9,720,375
GENERAL ELECTRIC CO................ 339,000 30,849,000
TYCO INTERNATIONAL LTD............. 861,354 54,265,302
---------------
116,250,052
---------------
POLLUTION CONTROL (0.8%)
*USA WASTE SERVICES, INC............ 155,700 7,687,688
</TABLE>
29
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- ------------------------- -------------------------
-- COLUMBIA GROWTH FUND, INC. --
------
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
WASTE MANAGEMENT, INC.............. 175,000 $ 6,125,000
---------------
13,812,688
---------------
TECHNOLOGY (19.3%)
*BAY NETWORKS, INC.................. 572,100 18,450,225
*CADENCE DESIGN SYSTEMS, INC........ 503,000 15,718,750
*CISCO SYSTEMS, INC................. 590,700 54,381,319
COMPAQ COMPUTER CORP............... 382,200 10,844,925
COMPUTER ASSOCIATES INTERNATIONAL,
INC............................... 350,850 19,494,103
*COMPUTER SCIENCES CORP............. 533,200 34,124,800
*EMC CORP........................... 300,300 13,457,194
ERICSSON (L.M.) TELEPHONE CO.
(CLASS B) ADR..................... 741,800 21,234,025
*GATEWAY 2000, INC.................. 470,500 23,819,062
LUCENT TECHNOLOGIES, INC........... 269,600 22,427,350
*MICROSOFT CORP..................... 500,000 54,187,500
*STORAGE TECHNOLOGY CORP............ 87,800 3,808,325
*STRUCTURAL DYNAMICS RESEARCH
CORP.............................. 387,400 8,958,625
*TELLABS, INC....................... 358,100 25,648,913
---------------
326,555,116
---------------
TRANSPORTATION (0.3%)
CNF TRANSPORTATION, INC............ 100,000 4,250,000
---------------
UTILITIES/COMMUNICATIONS (2.2%)
MCI COMMUNICATIONS CORP............ 200,000 11,625,000
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
SPRINT CORP........................ 109,400 $ 7,712,700
*WORLDCOM, INC...................... 383,500 18,575,781
---------------
37,913,481
---------------
TOTAL COMMON STOCKS
(COST $1,141,868,701)............. 1,644,039,384
---------------
REPURCHASE AGREEMENT (2.1%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $35,179,637
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023.
(COST $35,174,019)................ $35,174,019 35,174,019
---------------
TOTAL INVESTMENTS (99.4%)
(COST $1,177,042,720)................. 1,679,213,403
RECEIVABLES LESS LIABILITIES (0.6%).... 11,144,538
---------------
NET ASSETS (100.0%).................... $ 1,690,357,941
---------------
---------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
30
<PAGE>
SCHEDULE OF INVESTMENTS
-----------------------------------------------------------------
[LOGO]
- ------------------ ------------------
-- COLUMBIA INTERNATIONAL STOCK FUND, INC. --
------
<TABLE>
<CAPTION>
SHARES OR
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
COMMON STOCKS (93.8%)
BELGIUM (0.5%)
*LERNOUT & HAUSPIE SPEECH PRODUCTS
NV (BUSINESS SERVICES)............ 13,800 $ 823,687
-------------
BRAZIL (0.3%)
CIA TECIDOS DO NORTE DE MINAS SA
(TEXTILES)........................ 1,973,067 443,578
-------------
CANADA (2.6%)
BANK OF MONTREAL (BANKING)......... 6,800 374,643
BOMBARDIER, INC. (CLASS B)
(MANUFACTURING -
DIVERSIFIED INDS.)................ 25,000 680,179
CANADIAN NATIONAL RAILWAY CO.
(TRANSPORTATION).................. 8,500 452,115
*DANIER LEATHER, INC. (RETAIL)...... 47,800 292,613
*NEWBRIDGE NETWORKS CORP.
(ELECTRONICS)..................... 15,000 358,625
NORTHERN TELECOM LTD.
(ELECTRONICS)..................... 14,000 794,178
*POCO PETROLEUMS LTD. (OIL
EXPLORATION & PRODUCTION)......... 42,000 411,373
SUNCOR ENERGY, INC. (OIL
EXPLORATION & PRODUCTION)......... 18,000 612,162
-------------
3,975,888
-------------
CHILE (0.5%)
DISTRIBUCION Y SERVICIO D&S SA, ADR
(RETAIL).......................... 50,000 750,000
-------------
FINLAND (2.8%)
FINNLINES OYJ (TRANSPORTATION)..... 17,000 1,054,590
HARTWALL OY AB (SERIES A) (FOOD &
BEVERAGES)........................ 10,000 321,121
MERITA PLC (CLASS A) (BANKING)..... 280,000 1,849,365
TIETO CORP. (CLASS B)
(BUSINESS SERVICES)............... 8,100 616,279
YIT-YHTYMA OYJ (CONSTRUCTION)...... 31,400 504,160
-------------
4,345,515
-------------
FRANCE (10.3%)
ALCATEL ALSTHOM SA (ELECTRONICS)... 5,700 1,160,783
*ALSTOM SA (MACHINERY & CAPITAL
SPENDING)......................... 20,000 658,417
BANQUE NATIONALE DE PARIS
(BANKING)......................... 4,000 326,893
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
CIE DE SAINT GOBAIN SA (BUILDING
MATERIALS)........................ 4,184 $ 775,917
FRANCE TELECOM SA, ADR (UTILITIES -
COMMUNICATION).................... 39,000 2,712,937
L'OREAL SA (CONSUMER PRODUCTS)..... 4,000 2,225,384
PARIBAS SA (BANKING)............... 6,000 642,205
*RENAULT SA (MOTOR VEHICLES &
PARTS)............................ 50,000 2,844,594
*RHODIA SA (CHEMICALS).............. 10,000 278,917
SCHNEIDER SA (ELECTRICAL
EQUIPMENT)........................ 13,000 1,036,808
SODEXHO ALLIANCE SA
(FOOD & BEVERAGES)................ 4,000 756,353
SYNTHELABO SA (PHARMACEUTICALS).... 3,600 607,464
TOTAL SA (CLASS B) (OIL EXPLORATION
& PRODUCTION)..................... 6,200 806,181
VIVENDI SA (UTILITIES)............. 4,700 1,003,788
-------------
15,836,641
-------------
GERMANY (6.1%)
ALLIANZ AG (INSURANCE)............. 3,000 1,000,610
*ALLIANZ AG (NEW) (INSURANCE)....... 88 29,107
DEUTSCHE BANK AG (BANKING)......... 12,500 1,057,724
MANNESMANN AG (MACHINERY & CAPITAL
SPENDING)......................... 34,000 3,497,283
RWE AG (MANUFACTURING - DIVERSIFIED
INDS.)............................ 12,000 710,658
THYSSEN AG (METALS, MINING &
STEEL)............................ 6,000 1,527,115
VOLKSWAGEN AG (MOTOR
VEHICLES & PARTS)................. 1,615 1,560,910
-------------
9,383,407
-------------
GREECE (0.3%)
*STET HELLAS TELECOMMUNICATIONS SA,
ADR (UTILITIES - COMMUNICATION)... 10,000 415,000
-------------
HUNGARY (0.2%)
*GEDEON RICHTER LTD., GDR
(PHARMACEUTICALS)................. 4,000 319,000
-------------
INDIA (1.8%)
BAJAJ AUTO LTD., GDR (MOTOR
VEHICLES & PARTS)................. 30,000 400,500
BANK OF BARODA LTD. (BANKING)...... 271,000 536,815
INDIAN HOTELS CO., LTD., THE, GDR
(ENTERTAINMENT & LEISURE)......... 37,000 286,750
</TABLE>
31
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- ------------------ ------------------
-- COLUMBIA INTERNATIONAL STOCK FUND, INC. --
------
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
INDUSTRIAL CREDIT & INVESTMENT
CORP. OF INDIA LTD., THE, GDR
(FINANCIAL SERVICES).............. 30,000 $ 304,125
INFOSYS TECHNOLOGIES LTD. (BUSINESS
SERVICES)......................... 15,200 793,592
MAHINDRA & MAHINDRA LTD. (MOTOR
VEHICLES & PARTS)................. 70,000 358,847
-------------
2,680,629
-------------
IRELAND (1.1%)
BANK OF IRELAND PLC (BANKING)...... 42,000 863,687
IRISH LIFE PLC (INSURANCE)......... 87,500 816,492
-------------
1,680,179
-------------
ITALY (4.5%)
ALLEANZA ASSICURAZIONI S.P.A
(INSURANCE)....................... 53,000 706,309
CREDITO ITALIANO S.P.A (BANKING)... 488,500 2,539,101
FIAT S.P.A (MOTOR VEHICLES &
PARTS)............................ 266,000 1,167,856
LA RINASCENTE S.P.A (RETAIL)....... 74,000 723,097
TELECOM ITALIA S.P.A, ADR
(UTILITIES - COMMUNICATION)....... 22,800 1,675,800
-------------
6,812,163
-------------
JAPAN (16.4%)
AIWA CO., LTD. (ELECTRONICS)....... 18,000 564,854
BANK OF TOKYO-MITSUBISHI LTD., ADR,
THE (BANKING)..................... 240,100 2,641,100
BANYU PHARMACEUTICAL CO., LTD.
(PHARMACEUTICALS)................. 65,000 703,362
BRIDGESTONE CORP. (MOTOR VEHICLES &
PARTS)............................ 32,000 757,178
ITO-YOKADO CO., LTD. (RETAIL)...... 16,000 753,715
ITO-YOKADO CO., LTD., ADR
(RETAIL).......................... 20,000 950,000
KAO CORP. (CONSUMER PRODUCTS)...... 65,000 1,003,463
KEYENCE CORP. (ELECTRONICS)........ 4,600 501,082
KOMATSU LTD. (MACHINERY & CAPITAL
SPENDING)......................... 143,000 695,296
MABUCHI MOTOR CO., LTD. (ELECTRICAL
EQUIPMENT)........................ 16,000 1,015,726
MITSUBISHI ESTATE CO., LTD. (REAL
ESTATE)........................... 70,000 616,073
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
NINTENDO CO., LTD. (ENTERTAINMENT &
LEISURE).......................... 5,000 $ 463,497
NIPPON TELEGRAPH & TELEPHONE CORP.
(UTILITIES - COMMUNICATION)....... 1,610 1,335,666
NOMURA SECURITIES CO., LTD., THE
(FINANCIAL SERVICES).............. 152,000 1,770,884
NTT DATA CORP. (BUSINESS
SERVICES)......................... 16 578,271
ROHM CO., LTD. (ELECTRONICS)....... 13,000 1,336,387
SANWA BANK LTD., THE (BANKING)..... 118,000 1,056,399
SEKISUI HOUSE LTD.
(CONSTRUCTION).................... 112,000 868,562
SEVEN-ELEVEN JAPAN CO., LTD.
(RETAIL).......................... 3,000 178,762
SONY CORP. (ELECTRONICS)........... 16,000 1,379,310
SONY CORP., ADR (ELECTRONICS)...... 17,000 1,463,062
TAKEDA CHEMICAL INDS., LTD.
(PHARMACEUTICALS)................. 41,000 1,091,401
TOKIO MARINE & FIRE INSURANCE CO.,
LTD., THE (INSURANCE)............. 130,000 1,337,325
TORAY INDUSTRIES, INC.
(CHEMICALS)....................... 65,000 337,614
TOYOTA MOTOR CORP. (MOTOR VEHICLES
& PARTS).......................... 50,000 1,294,907
TRANS COSMOS, INC. (BUSINESS
SERVICES)......................... 18,000 433,704
-------------
25,127,600
-------------
MEXICO (1.1%)
*INDUSTRIAS CH SA (SERIES B)
(METALS, MINING & STEEL).......... 280,000 906,946
TUBOS DE ACERO DE MEXICO SA, ADR
(METALS, MINING & STEEL).......... 60,000 768,750
-------------
1,675,696
-------------
NETHERLANDS (5.8%)
ABN AMRO HOLDING NV (BANKING)...... 32,524 761,506
AEGON NV (INSURANCE)............... 51,984 4,525,907
AKZO NOBEL NV (CHEMICALS).......... 4,800 1,067,664
ROYAL PHILIPS ELECTRONICS NV
(ELECTRONICS)..................... 20,000 1,682,243
VEDIOR NV (CERTIFICATES) (BUSINESS
SERVICES)......................... 13,004 367,796
VENDEX NV (RETAIL)................. 13,178 495,876
-------------
8,900,992
-------------
</TABLE>
32
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- ------------------ ------------------
-- COLUMBIA INTERNATIONAL STOCK FUND, INC. --
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<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
NORWAY (1.1%)
NARVESEN ASA (RETAIL).............. 9,000 $ 187,867
TOMRA SYSTEMS ASA (MACHINERY &
CAPITAL SPENDING)................. 49,000 1,470,320
-------------
1,658,187
-------------
POLAND (0.2%)
*MOSTOSTAL-WARSZAWA SA, GDR
(CONSTRUCTION).................... 34,800 241,860
-------------
SPAIN (7.3%)
AZKOYEN SA (MANUFACTURING -
CONSUMER PRODUCTS)................ 4,000 621,816
BANCO BILBAO VIZCAYA SA
(BANKING)......................... 64,000 3,289,876
DRAGADOS Y CONSTRUCCIONES SA
(CONSTRUCTION).................... 59,000 1,892,162
METROVACESA SA (REAL ESTATE)....... 35,000 1,031,026
TELEFONICA DE ESPANA SA, ADR
(UTILITIES - COMMUNICATION)....... 16,363 2,275,480
*TELEPIZZA SA (RESTAURANTS)......... 130,000 1,379,817
VALLEHERMOSO SA (REAL ESTATE)...... 20,000 736,773
-------------
11,226,950
-------------
SWEDEN (2.8%)
ASSA ABLOY AB (CLASS B)
(MANUFACTURING - DIVERSIFIED
INDS.)............................ 23,000 904,024
BILSPEDITION TRANSPORT & LOGISTICS
(BTL) AB (TRANSPORTATION)......... 86,000 462,563
ICB SHIPPING AB (CLASS B)
(TRANSPORTATION).................. 63,000 568,706
MUNTERS AB (MANUFACTURING -
CONSUMER PRODUCTS)................ 74,300 810,444
*N&T ARGONAUT AB (CLASS B)
(TRANSPORTATION).................. 320,000 441,324
SKANDIA INSURANCE CO., LTD.
(INSURANCE)....................... 61,000 871,866
SPECTRA-PHYSICS AB (CLASS A)
(ELECTRONICS)..................... 14,000 223,796
-------------
4,282,723
-------------
SWITZERLAND (4.0%)
CREDIT SUISSE GROUP (REGISTERED)
(FINANCIAL SERVICES).............. 6,500 1,447,542
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
*GRETAG IMAGING GROUP (REGISTERED)
(MACHINERY & CAPITAL SPENDING).... 7,000 $ 672,055
NOVARTIS AG (BEARER)
(PHARMACEUTICALS)................. 1,500 2,500,165
*SAIA-BURGESS ELECTRONICS AG
(REGISTERED) (ELECTRONICS)........ 2,700 726,889
UBS AG (REGISTERED) (BANKING)...... 2,000 744,309
-------------
6,090,960
-------------
THAILAND (0.2%)
*BANGKOK BANK PUBLIC CO., LTD.
(FOREIGN) (BANKING)............... 160,000 197,156
THAI FARMERS BANK PUBLIC CO., LTD.
(FOREIGN) (BANKING)............... 175,000 154,473
-------------
351,629
-------------
UNITED KINGDOM (23.9%)
BANK OF SCOTLAND PLC (BANKING)..... 86,000 962,421
BARCLAYS PLC (BANKING)............. 50,639 1,459,395
BRITISH AEROSPACE PLC
(AIRCRAFT & AEROSPACE)............ 240,924 1,844,322
BRITISH PETROLEUM CO. PLC (OIL
EXPLORATION & PRODUCTION)......... 56,561 824,465
BRITISH SKY BROADCASTING GROUP PLC
(MEDIA)........................... 105,000 753,887
BRITISH TELECOMMUNICATIONS PLC
(UTILITIES - COMMUNICATION)....... 210,000 2,591,761
CADBURY SCHWEPPES PLC (FOOD &
BEVERAGES)........................ 54,000 835,318
COMPASS GROUP PLC (RESTAURANTS).... 320,000 3,677,165
*COMPUTACENTER PLC (BUSINESS
SERVICES)......................... 100,000 1,249,182
ELECTROCOMPONENTS PLC
(ELECTRONICS)..................... 86,469 677,801
GKN PLC (MOTOR VEHICLES & PARTS)... 58,000 738,552
GLAXO WELLCOME PLC
(PHARMACEUTICALS)................. 86,000 2,580,320
GRANADA GROUP PLC (ENTERTAINMENT &
LEISURE).......................... 60,975 1,120,669
HAYS PLC (BUSINESS SERVICES)....... 120,000 2,011,367
*ICON PLC, ADR (PHARMACEUTICALS).... 9,000 227,250
MISYS PLC (BUSINESS SERVICES)...... 15,000 851,829
</TABLE>
33
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-- COLUMBIA INTERNATIONAL STOCK FUND, INC. --
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<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
NATIONAL WESTMINSTER BANK PLC
(BANKING)......................... 93,000 $ 1,661,179
NEXT PLC (RETAIL).................. 80,000 687,134
PEARSON PLC (MEDIA)................ 70,000 1,281,871
RAILTRACK GROUP PLC
(TRANSPORTATION).................. 80,000 1,959,999
ROBERT WALTERS PLC (BUSINESS
SERVICES)......................... 54,000 376,456
SELECT APPOINTMENTS HOLDINGS PLC
(BUSINESS SERVICES)............... 54,000 765,520
SIEBE PLC (MACHINERY & CAPITAL
SPENDING)......................... 72,295 1,443,266
*SMALLWORLDWIDE PLC, ADR (BUSINESS
SERVICES)......................... 19,000 553,375
SMITHKLINE BEECHAM PLC
(PHARMACEUTICALS)................. 201,072 2,453,070
VODAFONE GROUP PLC (UTILITIES -
COMMUNICATION).................... 80,000 1,014,689
WETHERSPOON, J.D. PLC
(RESTAURANTS)..................... 140,000 682,964
WPP GROUP PLC (MEDIA).............. 200,000 1,310,057
-------------
36,595,284
-------------
TOTAL COMMON STOCKS
(COST $108,696,027)............... 143,617,568
-------------
PREFERRED STOCKS (1.4%)
BRAZIL (0.1%)
DIXIE TOGA SA (CONTAINERS)......... 437,500 185,365
EMPRESA NACIONAL DE COMERCIO REDITO
E PARTICIPACOES SA (TEXTILES)..... 1,195,000 2,997
-------------
188,362
-------------
GERMANY (1.3%)
PORSCHE AG (MOTOR VEHICLES &
PARTS)............................ 700 2,018,410
-------------
TOTAL PREFERRED STOCKS
(COST $1,091,140)................. 2,206,772
-------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
WARRANT (0.3%)
FRANCE (0.3%)
*VIVENDI SA (05/02/2001) (UTILITIES)
(COST $129,829)................... 220,000 $ 433,099
-------------
TOTAL INVESTMENTS, EXCLUDING
TEMPORARY CASH INVESTMENT
(COST $109,916,996)............... 146,257,439
-------------
REPURCHASE AGREEMENT (4.3%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $6,608,619.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023.
(COST $6,607,564)................. $6,607,564 6,607,564
-------------
TOTAL INVESTMENTS (99.8%)
(COST $116,524,560)................... 152,865,003
CASH AND RECEIVABLES LESS LIABILITIES
(0.2%)................................ 229,038
-------------
NET ASSETS (100%)...................... $ 153,094,041
-------------
-------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
34
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-- COLUMBIA SPECIAL FUND, INC. --
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<TABLE>
<CAPTION>
SHARES OR
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
COMMON STOCKS (92.5%)
BUILDING & FORESTRY PRODUCTS (1.6%)
LONGVIEW FIBRE CO.................. 1,215,000 $ 17,313,750
---------------
BUSINESS & CONSUMER SERVICES (14.5%)
*ADMINISTAFF, INC................... 335,000 15,451,875
*CSG SYSTEMS INTERNATIONAL, INC..... 200,000 9,375,000
DENTSPLY INTERNATIONAL, INC........ 250,000 6,250,000
*FISERV, INC........................ 555,000 23,570,156
MCKESSON CORP...................... 250,000 20,312,500
MEREDITH CORP...................... 200,000 9,387,500
*NOVACARE EMPLOYEE SERVICES, INC.... 500,000 4,750,000
*PROFESSIONAL DETAILING, INC........ 200,000 4,975,000
*ROMAC INTERNATIONAL, INC........... 465,000 14,124,375
SERVICE CORPORATION INT'L.......... 570,000 24,438,750
SERVICEMASTER CO................... 450,000 17,128,125
UNITOG CO.......................... 450,000 9,900,000
---------------
159,663,281
---------------
CONSUMER DURABLE (2.0%)
*FURNITURE BRANDS INTERNATIONAL,
INC............................... 765,000 21,467,812
---------------
CONSUMER NON-DURABLE (24.4%)
*ABERCROMBIE & FITCH CO. (CLASS
A)................................ 800,000 35,200,000
+*ANNTAYLOR STORES CORP.............. 1,400,000 29,662,500
*BED, BATH & BEYOND, INC............ 390,000 20,206,875
*BRINKER INTERNATIONAL, INC......... 175,000 3,368,750
+CROWN CRAFTS, INC.................. 544,800 8,376,300
+*GADZOOKS, INC...................... 710,000 19,569,375
*HELEN OF TROY LTD.................. 400,000 8,800,000
*LANDRY'S SEAFOOD RESTAURANTS,
INC............................... 1,000,000 18,093,750
*LINENS 'N THINGS, INC.............. 400,000 12,225,000
*OUTBACK STEAKHOUSE, INC............ 100,000 3,900,000
*PAPA JOHN'S INTERNATIONAL, INC..... 380,000 14,986,250
PILLOWTEX CORP..................... 360,000 14,445,000
*PLANET HOLLYWOOD INTERNATIONAL,
INC. (CLASS A).................... 1,300,000 9,100,000
*RESTORATION HARDWARE, INC.......... 25,000 628,125
ST. JOHN KNITS, INC................ 610,000 23,561,250
+*VANS, INC.......................... 815,000 7,895,313
*WESTPOINT STEVENS, INC............. 650,000 21,450,000
*WILLIAMS-SONOMA, INC............... 500,000 15,906,250
---------------
267,374,738
---------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
CONSUMER STAPLES (12.7%)
AMERICAN STORES CO................. 1,815,000 $ 43,900,313
HANNAFORD BROTHERS CO.............. 300,000 13,200,000
*KROGER CO.......................... 440,000 18,865,000
*MEYER (FRED), INC.................. 700,000 29,750,000
*SAFEWAY, INC....................... 500,000 20,343,750
*WHOLE FOODS MARKET, INC............ 225,000 13,612,500
---------------
139,671,563
---------------
ENERGY (1.0%)
*TRITON ENERGY LTD.................. 294,000 10,492,125
---------------
ENERGY SERVICES (1.4%)
*BJ SERVICES CO..................... 531,000 15,432,188
---------------
FINANCE (3.6%)
HARTFORD LIFE, INC. (CLASS A)...... 150,000 8,540,625
*REINSURANCE GROUP OF AMERICA (CLASS
A)................................ 200,000 10,262,500
TRAVELERS PROPERTY CASUALTY CORP.
(CLASS A)......................... 360,000 15,435,000
UNUM CORP.......................... 100,000 5,550,000
---------------
39,788,125
---------------
HEALTH (13.2%)
*AMERICAN ONCOLOGY
RESOURCES, INC.................... 750,000 9,164,062
*CYTYC CORP......................... 510,000 8,319,375
*ESC MEDICAL SYSTEMS LTD............ 730,000 24,637,500
*INHALE THERAPEUTIC SYSTEMS......... 300,000 7,425,000
MENTOR CORP........................ 320,000 7,760,000
OMNICARE, INC...................... 200,000 7,625,000
*PAREXEL INTERNATIONAL CORP......... 330,000 12,003,750
+*RESMED, INC........................ 505,000 23,009,063
*SEROLOGICALS CORP.................. 350,000 11,287,500
*SHIRE PHARMACEUTICALS GROUP PLC
ADR............................... 250,000 5,343,750
*SOFAMOR DANEK GROUP, INC........... 100,000 8,656,250
*TRANSKARYOTIC THERAPIES, INC....... 200,000 5,150,000
*WATSON PHARMACEUTICALS, INC........ 300,000 14,006,250
---------------
144,387,500
---------------
MACHINERY & CAPITAL SPENDING (1.0%)
APPLIED POWER, INC. (CLASS A)...... 200,000 6,875,000
GENERAL CABLE CORP................. 150,000 4,331,250
---------------
11,206,250
---------------
METAL MINING & STEEL (1.1%)
*GETCHELL GOLD CORP................. 780,000 11,992,500
---------------
</TABLE>
35
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- -------------------------- --------------------------
-- COLUMBIA SPECIAL FUND, INC. --
------
<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
POLLUTION CONTROL (6.0%)
*AIR & WATER TECHNOLOGIES CORP.
(CLASS A)......................... 2,300,000 $ 7,187,500
*ALLIED WASTE INDUSTRIES, INC....... 500,000 12,000,000
*CUNO, INC.......................... 360,000 7,785,000
*ESCO ELECTRONICS CORP.............. 360,000 6,840,000
*IONICS, INC........................ 360,000 13,275,000
+*OSMONICS, INC...................... 977,300 11,666,519
*U.S. FILTER CORP................... 250,000 7,015,625
---------------
65,769,644
---------------
TECHNOLOGY (6.7%)
ADOBE SYSTEMS, INC................. 200,000 8,487,500
*ADVANCED FIBRE COMMUNICATIONS,
INC............................... 152,000 6,089,500
*COMPUTER HORIZONS CORP............. 30,000 1,111,875
*EDWARDS (J.D.) & CO................ 146,000 6,268,875
*HNC SOFTWARE, INC.................. 88,600 3,615,987
*INTERNATIONAL NETWORK SERVICES..... 171,000 7,011,000
*KEANE, INC......................... 120,000 6,720,000
*NETWORK APPLIANCE, INC............. 158,300 6,163,806
*SAVILLE SYSTEMS PLC ADR............ 133,000 6,666,625
*SS&C TECHNOLOGIES, INC............. 15,000 341,250
*STORAGE TECHNOLOGY CORP............ 16,400 711,350
TEXAS INSTRUMENTS, INC............. 100,000 5,831,250
*UNIPHASE CORP...................... 113,000 7,094,281
*WIND RIVER SYSTEMS, INC............ 54,500 1,955,188
*3COM CORP.......................... 185,000 5,677,188
---------------
73,745,675
---------------
TRANSPORTATION (2.2%)
+*CELADON GROUP, INC................. 500,000 9,500,000
*RENO AIR, INC...................... 500,000 3,468,750
*TRANS WORLD AIRLINES, INC.......... 1,135,000 11,775,625
---------------
24,744,375
---------------
UTILITIES/ELECTRIC/GAS (1.1%)
UNITED WATER RESOURCES, INC........ 650,000 11,700,000
---------------
TOTAL COMMON STOCKS
(COST $879,519,314)............... 1,014,749,526
---------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
WARRANT (0.0%)
POLLUTION CONTROL (0.0%)
*AIR & WATER TECHNOLOGIES CORP.
(03/11/2001)
(COST $272,842)................... 300,140 $ 337,657
---------------
TOTAL INVESTMENTS, EXCLUDING
TEMPORARY CASH INVESTMENTS
(COST $879,792,156)............... 1,015,087,183
---------------
REPURCHASE AGREEMENTS (8.8%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $56,543,482.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023............. $56,534,452 56,534,452
J.P. MORGAN SECURITIES, INC. 5.830%
DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $40,006,389.
COLLATERALIZED BY
U.S. TREASURY NOTES
5.625% TO 6.750%
DUE 04/30/2000 TO 12/31/2002...... 40,000,000 40,000,000
---------------
TOTAL REPURCHASE AGREEMENTS
(COST $96,534,452)................ 96,534,452
---------------
TOTAL INVESTMENTS (101.3%)
(COST $976,326,608)................... 1,111,621,635
RECEIVABLES LESS LIABILITIES (-1.3%)... (14,098,322)
---------------
NET ASSETS (100.0%).................... $ 1,097,523,313
---------------
---------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
+ Affiliated issuers (Note 1).
The accompanying notes are an integral part
of the financial statements.
36
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<TABLE>
<CAPTION>
SHARES OR
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
COMMON STOCKS (90.6%)
BUILDING & FORESTRY PRODUCTS (2.8%)
MARTIN MARIETTA MATERIALS, INC..... 58,000 $ 2,610,000
SOUTHDOWN, INC..................... 17,000 1,213,375
-------------
3,823,375
-------------
BUSINESS & CONSUMER SERVICES (11.8%)
*ASYMETRIX LEARNING SYSTEMS, INC.... 41,900 379,719
COGNIZANT CORP..................... 19,855 1,250,865
*DOLLAR THRIFTY AUTOMOTIVE GROUP,
INC............................... 38,000 503,500
*FAMILY GOLF CENTERS, INC........... 74,250 1,879,453
G & K SERVICES, INC. (CLASS A)..... 33,300 1,452,713
*ITT EDUCATIONAL SERVICES, INC...... 71,500 2,305,875
*LAMALIE ASSOCIATES, INC............ 3,000 55,125
*NEFF CORP.......................... 27,500 319,688
*PMT SERVICES, INC.................. 125,000 3,179,687
*PROFIT RECOVERY GROUP
INTERNATIONAL, INC................ 55,400 1,547,737
*ROMAC INTERNATIONAL, INC........... 50,000 1,518,750
SELECT APPOINTMENTS
HOLDINGS PLC ADR.................. 33,000 973,500
*U.S. RENTALS, INC.................. 16,000 631,000
*UNITED ROAD SERVICES, INC.......... 22,000 420,750
-------------
16,418,362
-------------
CONSUMER DURABLE (3.9%)
*CHAMPION ENTERPRISES, INC.......... 56,300 1,646,775
*COASTCAST CORP..................... 60,000 1,080,000
KAUFMAN & BROAD HOME CORP.......... 25,000 793,750
WATSCO, INC........................ 55,500 1,952,906
-------------
5,473,431
-------------
CONSUMER NON-DURABLE (10.1%)
*BED, BATH & BEYOND, INC............ 12,200 632,113
*BON-TON STORES, INC................ 63,500 1,019,969
*BUILDING MATERIALS
HOLDING CORP...................... 61,300 846,706
CKE RESTAURANTS, INC............... 71,380 2,944,425
*CAVANAUGHS HOSPITALITY CORP........ 16,000 209,000
*COLUMBIA SPORTSWEAR CO............. 12,000 228,000
*COST PLUS, INC..................... 61,000 1,814,750
*GIBSON GREETINGS, INC.............. 45,500 1,137,500
INTRAWEST CORP..................... 42,000 837,375
*MAXWELL SHOE CO., INC. (CLASS A)... 43,000 854,625
*OMEGA PROTEIN CORP................. 13,000 208,000
*SMED INTERNATIONAL, INC............ 33,000 594,000
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
*WILLIAMS-SONOMA, INC............... 84,200 $ 2,678,612
-------------
14,005,075
-------------
ENERGY (2.4%)
*MERIDIAN RESOURCE CORP............. 75,000 529,688
*OCEAN ENERGY, INC.................. 38,720 757,460
*SWIFT ENERGY CO.................... 85,000 1,354,687
*TESORO PETROLEUM CORP.............. 43,500 690,563
-------------
3,332,398
-------------
ENERGY SERVICES (2.3%)
*HANOVER COMPRESSOR CO.............. 77,000 2,083,812
*TUBOSCOPE, INC..................... 37,000 730,750
*WILLBROS GROUP, INC................ 27,000 421,875
-------------
3,236,437
-------------
FINANCE (4.1%)
*INSIGNIA FINANCIAL GROUP, INC.
(CLASS A)......................... 60,000 1,470,000
NORTH FORK BANCORP, INC............ 57,150 1,396,603
STIRLING COOKE BROWN
HOLDINGS LTD...................... 25,400 714,375
TCF FINANCIAL CORP................. 20,100 592,950
*WILSHIRE FINANCIAL SERVICES GROUP,
INC............................... 61,000 1,448,750
-------------
5,622,678
-------------
FOOD & HOUSEHOLD PRODUCTS (0.9%)
*AURORA FOODS, INC.................. 56,000 1,183,000
-------------
HEALTH (22.0%)
*ACCESS HEALTH, INC................. 45,400 1,157,700
*ASSISTED LIVING CONCEPTS, INC...... 47,000 810,750
*BALANCE BAR CO..................... 54,700 786,313
*BARR LABORATORIES, INC............. 70,000 2,782,500
*CARDIAC PATHWAYS CORP.............. 95,000 676,875
*CONCENTRA MANAGED CARE, INC........ 96,000 2,496,000
*COVANCE, INC....................... 60,000 1,402,500
*ESC MEDICAL SYSTEMS LTD............ 91,250 3,079,687
*HEALTH MANAGEMENT
SYSTEMS, INC...................... 75,000 843,750
*HEALTHCARE RECOVERIES, INC......... 52,500 1,036,875
*ICON PLC - SPONSORED ADR........... 28,800 727,200
*IDEXX LABORATORIES, INC............ 60,000 1,492,500
*INHALE THERAPEUTIC SYSTEMS......... 37,400 925,650
*INTELLIGENT POLYMERS LTD.
(UNITS - EACH UNIT CONSISTS OF
1 SHARE & 1 WARRANT).............. 33,000 668,250
JONES PHARMA, INC.................. 83,500 2,765,937
</TABLE>
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<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
*LIGAND PHARMACEUTICALS, INC. (CLASS
B)................................ 73,897 $ 951,424
*MEDCO RESEARCH, INC................ 48,000 1,224,000
*NEUREX CORP........................ 49,000 1,488,375
*SOMNUS MEDICAL TECHNOLOGIES,
INC............................... 80,000 655,000
*SPIROS DEVELOPMENT CORP. II
(UNITS - 1 CALLABLE COMMON SHARE
OF SPIROS & 1 WARRANT OF DURABLE
PHARMACEUTICALS).................. 30,000 483,750
*THERMO CARDIOSYSTEMS, INC.......... 50,000 1,137,500
*TRANSKARYOTIC THERAPIES, INC....... 45,000 1,158,750
*UNIVERSAL HEALTH SERVICES, INC.
(CLASS B)......................... 9,500 554,563
*WATSON PHARMACEUTICALS, INC........ 25,400 1,185,862
-------------
30,491,711
-------------
MACHINERY CAPITAL SPENDING (1.6%)
GERBER SCIENTIFIC, INC............. 60,000 1,365,000
*MORRISON KNUDSEN CORP.............. 64,000 900,000
-------------
2,265,000
-------------
MEDIA & ENTERTAINMENT (0.5%)
NELSON (THOMAS), INC............... 51,000 682,125
-------------
METALS & MINING (1.0%)
OREGON STEEL MILLS, INC............ 76,000 1,415,500
-------------
POLLUTION CONTROL (1.1%)
*ALLIED WASTE INDUSTRIES, INC....... 63,500 1,524,000
-------------
TECHNOLOGY (22.5%)
*ACTEL CORP......................... 100,000 1,075,000
*ACXIOM CORP........................ 80,000 1,995,000
*AMERICAN MANAGEMENT
SYSTEMS, INC...................... 98,000 2,933,875
*ASCEND COMMUNICATIONS, INC......... 52,000 2,577,250
*AXENT TECHNOLOGIES, INC............ 49,800 1,525,125
*CERNER CORP........................ 105,800 2,995,462
*CYMER, INC......................... 11,000 177,375
*DAVOX CORP......................... 10,900 238,438
*DOCUMENTUM, INC.................... 11,900 571,200
*ETEC SYSTEMS, INC.................. 6,500 228,719
*ENGINEERING ANIMATION, INC......... 33,600 2,049,600
*HNC SOFTWARE, INC.................. 57,000 2,326,312
*HYPERION SOFTWARE CORP............. 62,400 1,778,400
*INFINIUM SOFTWARE, INC............. 50,000 693,750
*MICROS SYSTEMS, INC................ 71,200 2,356,275
*NETWORK APPLIANCE, INC............. 40,000 1,557,500
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
*OBJECTIVE SYSTEMS INTEGRATORS,
INC............................... 90,000 $ 663,750
*PEERLESS SYSTEMS CORP.............. 37,000 767,750
*PLATINUM SOFTWARE CORP............. 103,600 2,525,250
*RADISYS CORP....................... 5,500 118,250
*SYNOPSYS, INC...................... 6,500 297,375
*TRANSISTION SYSTEMS, INC........... 35,000 371,875
*XIRCOM, INC........................ 90,000 1,400,625
-------------
31,224,156
-------------
TRANSPORTATION (1.3%)
*EAGLE USA AIRFREIGHT, INC.......... 52,000 1,803,750
-------------
UTILITIES/COMMUNICATIONS (2.3%)
*ANICOM, INC........................ 88,000 1,309,000
COMSAT CORP........................ 35,000 990,938
*INTERMEDIA COMMUNICATIONS, INC..... 22,000 922,625
-------------
3,222,563
-------------
TOTAL COMMON STOCKS
(COST $110,018,637)............... 125,723,561
-------------
REPURCHASE AGREEMENTS (10.0%)
GOLDMAN SACHS CORP.
5.830% DATED 6/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $6,940,270.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023............. $6,939,162 6,939,162
J.P. MORGAN SECURITIES, INC.
5.830% DATED 6/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $6,901,102.
COLLATERALIZED BY
U.S. TREASURY NOTES
5.625% TO 6.750%
DUE 04/30/2000 TO 12/31/2002...... 6,900,000 6,900,000
-------------
TOTAL REPURCHASE AGREEMENTS
(COST $13,839,162)................ 13,839,162
-------------
TOTAL INVESTMENTS (100.6%)
(COST $123,857,799)................... 139,562,723
RECEIVABLES LESS LIABILITIES (-0.6%)... (812,886)
-------------
NET ASSETS (100.0%).................... $ 138,749,837
-------------
-------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part of the financial statements.
38
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<TABLE>
<CAPTION>
SHARES OR
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
COMMON STOCKS (93.6%)
REAL ESTATE
APARTMENTS (16.1%)
APARTMENT INVESTMENT & MANAGEMENT
CO. (CLASS A)..................... 230,000 $ 9,085,000
AVALON BAY COMMUNITIES, INC........ 92,964 3,532,632
COLONIAL PROPERTIES TRUST.......... 156,100 4,839,100
EQUITY RESIDENTIAL PROPERTIES
TRUST............................. 91,003 4,316,955
SECURITY CAPITAL PACIFIC TRUST..... 256,171 5,763,847
-------------
27,537,534
-------------
COMMUNITY CENTERS (12.1%)
*EXCEL LEGACY CORP.................. 142,100 620,977
EXCEL REALTY TRUST, INC............ 242,100 6,975,506
KIMCO REALTY CORP.................. 88,800 3,640,800
PAN PACIFIC RETAIL PROPERTIES,
INC............................... 152,200 2,948,875
VORNADO REALTY TRUST............... 161,900 6,425,406
-------------
20,611,564
-------------
INDUSTRIAL (30.3%)
ALEXANDRIA REAL ESTATE EQUITIES,
INC............................... 149,500 4,475,656
CABOT INDUSTRIAL TRUST............. 300,000 6,412,500
DUKE REALTY INVESTMENTS, INC....... 215,000 5,079,375
FIRST INDUSTRIAL REALTY TRUST,
INC............................... 155,500 4,946,844
LIBERTY PROPERTY TRUST............. 186,700 4,772,519
PROLOGIS TRUST..................... 194,145 4,853,625
PUBLIC STORAGE, INC................ 229,000 6,412,000
SHURGARD STORAGE CENTERS, INC.
(CLASS A)......................... 123,900 3,438,225
SPIEKER PROPERTIES, INC............ 151,500 5,870,625
STORAGE TRUST REALTY............... 51,200 1,196,800
TRINET CORPORATE REALTY TRUST,
INC............................... 131,000 4,454,000
-------------
51,912,169
-------------
LODGING (1.1%)
STARWOOD HOTELS & RESORTS.......... 40,200 1,942,163
-------------
MANUFACTURED HOMES (2.4%)
MANUFACTURED HOME COMMUNITIES,
INC............................... 170,400 4,110,900
-------------
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
OFFICE (15.8%)
BOSTON PROPERTIES, INC............. 137,000 $ 4,726,500
EQUITY OFFICE PROPERTIES TRUST..... 308,418 8,751,361
MACK-CALI REALTY CORP.............. 189,400 6,510,625
PRENTISS PROPERTIES TRUST.......... 135,000 3,282,187
RECKSON ASSOCIATES REALTY CORP..... 156,800 3,704,400
*RECKSON SERVICE INDUSTRIES, INC.... 12,544 41,521
-------------
27,016,594
-------------
OTHER (7.2%)
CAPITAL AUTOMOTIVE REIT............ 165,000 2,340,938
*CATELLUS DEVELOPMENT CORP.......... 261,900 4,632,356
*SECURITY CAPITAL GROUP, INC. (CLASS
B)................................ 202,900 5,402,213
-------------
12,375,507
-------------
SHOPPING MALLS (8.6%)
GENERAL GROWTH PROPERTIES, INC..... 143,000 5,344,625
MACERICH CO........................ 83,300 2,441,731
SIMON DEBARTOLO GROUP, INC......... 211,656 6,878,820
-------------
14,665,176
-------------
TOTAL COMMON STOCKS
(COST $143,317,639)............... 160,171,607
-------------
WARRANT (0.0%)
OTHER (0.0%)
*SECURITY CAPITAL GROUP, INC.
09/18/1997-09/18/1998
(COST $176,224)................... 22,497 7,733
-------------
TOTAL INVESTMENTS, EXCLUDING
TEMPORARY CASH INVESTMENTS
(COST $143,493,863)............... 160,179,340
-------------
REPURCHASE AGREEMENTS (5.8%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $8,856,584.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023............. $8,855,170 8,855,170
</TABLE>
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<TABLE>
<CAPTION>
REPURCHASE AGREEMENTS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
J.P. MORGAN SECURITIES, INC.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $1,100,176.
COLLATERALIZED BY
U.S. TREASURY NOTES
5.625% TO 6.750%
DUE 04/30/2000 TO 12/31/2002...... $1,100,000 $ 1,100,000
-------------
TOTAL REPURCHASE AGREEMENTS
(COST $9,955,170)................. 9,955,170
-------------
TOTAL INVESTMENTS (99.4%)
(COST $153,449,033)................... 170,134,510
RECEIVABLES LESS LIABILITIES (0.6%).... 977,527
-------------
NET ASSETS (100.0%).................... $ 171,112,037
-------------
-------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
SHARES OR
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
COMMON STOCKS (52.0%)
BUILDING & FORESTRY PRODUCTS (0.5%)
CHAMPION INTERNATIONAL CORP........ 22,700 $ 1,116,556
FORT JAMES CORP.................... 22,300 992,350
*OWENS-ILLINOIS, INC................ 50,100 2,241,975
-------------
4,350,881
-------------
BUSINESS & CONSUMER SERVICES (1.2%)
*CENDANT CORP....................... 101,300 2,114,637
SERVICE CORPORATION INT'L.......... 223,700 9,591,138
-------------
11,705,775
-------------
CHEMICALS (0.3%)
DU PONT (E.I.) DE NEMOURS &
CO................................ 37,000 2,761,125
-------------
CONSUMER DURABLE (0.3%)
BLACK & DECKER CORP................ 44,900 2,738,900
-------------
CONSUMER NON-DURABLE (4.7%)
DAYTON HUDSON CORP................. 96,400 4,675,400
LOWE'S COS., INC................... 174,600 7,082,212
MATTEL, INC........................ 204,750 8,663,484
MCDONALD'S CORP.................... 79,900 5,513,100
TANDY CORP......................... 177,400 9,413,288
WAL-MART STORES, INC............... 148,900 9,045,675
-------------
44,393,159
-------------
ENERGY (2.8%)
BRITISH PETROLEUM CO. PLC ADR...... 24,400 2,153,300
ELF AQUITANE S.A. ADR.............. 32,800 2,328,800
EXXON CORP......................... 106,000 7,559,125
MOBIL CORP......................... 76,800 5,884,800
ROYAL DUTCH PETROLEUM CO........... 70,900 3,886,206
TEXACO, INC........................ 74,300 4,434,781
-------------
26,247,012
-------------
ENERGY SERVICES (1.1%)
CAMCO INTERNATIONAL, INC........... 37,700 2,935,887
DIAMOND OFFSHORE DRILLING, INC..... 31,500 1,260,000
SCHLUMBERGER LTD................... 34,000 2,322,625
*SMITH INTERNATIONAL, INC........... 42,000 1,462,125
TRANSOCEAN OFFSHORE, INC........... 49,100 2,184,950
-------------
10,165,587
-------------
FINANCE (8.8%)
ALLSTATE CORP...................... 100,600 9,211,187
AMERICAN GENERAL CORP.............. 91,400 6,506,537
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
BANC ONE CORP...................... 106,600 $ 5,949,612
BANKAMERICA CORP................... 75,800 6,551,962
CHASE MANHATTAN CORP............... 64,000 4,832,000
CHUBB CORP......................... 69,600 5,594,100
CITICORP........................... 30,500 4,552,125
FREDDIE MAC........................ 161,000 7,577,063
FIRST CHICAGO NBD CORP............. 43,900 3,890,638
FIRST UNION CORP................... 135,100 7,869,575
MORGAN STANLEY, DEAN WITTER,
DISCOVER & CO..................... 69,100 6,314,013
NATIONSBANK CORP................... 107,600 8,231,400
TRAVELERS PROPERTY CASUALTY CORP.
(CLASS A)......................... 124,900 5,355,088
-------------
82,435,300
-------------
FOOD & HOUSEHOLD PRODUCTS (5.2%)
AVON PRODUCTS, INC................. 27,900 2,162,250
COCA-COLA CO....................... 126,900 10,849,950
FORTUNE BRANDS, INC................ 60,500 2,325,469
GILLETTE CO........................ 99,200 5,623,400
*MEYER (FRED), INC.................. 84,200 3,578,500
PEPSICO, INC....................... 134,200 5,527,362
RITE AID CORP...................... 180,000 6,761,250
*SAFEWAY, INC....................... 187,000 7,608,562
SYSCO CORP......................... 184,300 4,722,688
-------------
49,159,431
-------------
HEALTH (7.7%)
AMERICAN HOME PRODUCTS
CORP.............................. 209,600 10,846,800
BECTON DICKINSON & CO.............. 35,300 2,740,162
*BOSTON SCIENTIFIC CORP............. 85,900 6,152,588
BRISTOL-MYERS SQUIBB CO............ 84,100 9,666,244
LILLY (ELI) & CO................... 60,100 3,970,356
MERCK & CO., INC................... 55,400 7,409,750
PFIZER, INC........................ 124,600 13,542,462
SCHERING-PLOUGH CORP............... 82,800 7,586,550
WARNER-LAMBERT CO.................. 148,700 10,316,063
-------------
72,230,975
-------------
MACHINERY CAPITAL SPENDING (4.3%)
ALLIED SIGNAL, INC................. 155,800 6,913,625
EMERSON ELECTRIC CO................ 53,900 3,250,844
GENERAL ELECTRIC CO................ 176,000 16,016,000
TYCO INTERNATIONAL LTD............. 233,826 14,731,038
-------------
40,911,507
-------------
</TABLE>
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<TABLE>
<CAPTION>
COMMON STOCKS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
MEDIA & ENTERTAINMENT (1.0%)
*CHANCELLOR MEDIA CORP.............. 120,900 $ 6,003,441
NEW YORK TIMES CO. (CLASS A)....... 49,500 3,922,875
-------------
9,926,316
-------------
POLLUTION CONTROL (0.5%)
*USA WASTE SERVICES, INC............ 59,000 2,913,125
WASTE MANAGEMENT, INC.............. 56,700 1,984,500
-------------
4,897,625
-------------
TECHNOLOGY (9.6%)
*BAY NETWORKS, INC.................. 216,800 6,991,800
*CADENCE DESIGN SYSTEMS, INC........ 184,300 5,759,375
*CISCO SYSTEMS, INC................. 71,750 6,605,484
COMPAQ COMPUTER CORP............... 123,600 3,507,150
COMPUTER ASSOCIATES INTERNATIONAL,
INC............................... 106,000 5,889,625
*COMPUTER SCIENCES CORP............. 128,000 8,192,000
ERICSSON (LM) TELEPHONE CO. (CLASS
B) ADR............................ 177,000 5,066,625
*GATEWAY 2000, INC.................. 120,400 6,095,250
INTERNATIONAL BUSINESS MACHINES
CORP.............................. 69,700 8,002,431
LUCENT TECHNOLOGIES, INC........... 99,700 8,293,794
*MICROSOFT CORP..................... 137,200 14,869,050
*STORAGE TECHNOLOGY CORP............ 26,000 1,127,750
*STRUCTURAL DYNAMICS RESEARCH
CORP.............................. 151,400 3,501,125
*TELLABS, INC....................... 87,700 6,281,513
-------------
90,182,972
-------------
TRANSPORTATION (0.3%)
*AMR CORP........................... 37,000 3,080,250
-------------
UTILITIES/COMMUNICATIONS (2.4%)
AT&T CORP.......................... 22,300 1,273,888
AMERITECH CORP..................... 55,100 2,472,612
BELL ATLANTIC CORP................. 59,200 2,701,000
MCI COMMUNICATIONS CORP............ 47,800 2,778,375
SBC COMMUNICATIONS, INC............ 94,100 3,764,000
SPRINT CORP........................ 32,800 2,312,400
*WORLDCOM, INC...................... 147,700 7,154,219
-------------
22,456,494
-------------
UTILITIES/ELECTRIC/GAS (1.3%)
CMS ENERGY CORP.................... 40,400 1,777,600
DUKE ENERGY CORP................... 54,600 3,235,050
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
HOUSTON INDUSTRIES, INC............ 91,500 $ 2,825,063
PECO ENERGY CO..................... 63,000 1,838,812
TEXAS UTILITIES CO................. 56,700 2,360,138
-------------
12,036,663
-------------
TOTAL COMMON STOCKS
(COST $368,045,722)............... 489,679,972
-------------
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (24.9%)
U.S. TREASURY BONDS & NOTES (8.6%)
U.S. TREASURY BONDS
8.875% 08/15/2017................ $13,150,000 17,925,094
8.125% 08/15/2019................ 12,315,000 15,888,271
U.S. TREASURY NOTES
6.875% 08/31/1999................ 33,610,000 34,098,387
6.500% 08/31/2001................ 12,735,000 13,077,253
-------------
80,989,005
-------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) (2.0%)
7.000% 03/15/2028 - 04/15/2028... 16,267,508 16,533,644
7.500% 08/15/2025 - 03/15/2028... 2,592,361 2,665,544
-------------
19,199,188
-------------
FEDERAL HOME LOAN MORTGAGE CORP. (FHLMC) (0.1%)
7.000% 05/01/2012................ 907,237 924,475
-------------
FEDERAL HOUSING ADMINISTRATION (FHA) (0.3%)
FHA INSURED PROJECT POOL #55
7.430% 04/01/2022................ 1,881,858 1,991,952
FHA INSURED PROJECT POOL #53-43077
9.125% 07/25/2033................ 1,096,969 1,165,530
-------------
3,157,482
-------------
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS (13.9%)
GNMA (3.0%)
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-4 CL. B
7.000% 08/20/2026.............. 4,030,066 4,110,515
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-4 CL. C
7.000% 03/20/2027.............. 3,877,000 4,015,662
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-4 CL. M
7.500% 02/16/2012.............. 2,292,063 2,303,795
</TABLE>
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<TABLE>
<CAPTION>
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-4 CL. N
7.500% 02/16/2027.............. $ 3,193,098 $ 3,295,353
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1996-15 CL. B
7.500% 08/20/2020.............. 8,493,000 8,643,128
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-11 CL. M
8.000% 05/16/2024.............. 5,940,000 6,145,493
-------------
28,513,946
-------------
FNMA (4.7%)
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1994-10 CL. UU
6.500% 01/25/2024.............. 857,000 856,875
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-G1 CL. B
7.500% 06/20/2024.............. 4,480,000 4,632,178
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-27 CL. B
7.000% 02/18/2025.............. 3,020,000 3,054,910
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-17 CL. PE
7.000% 01/18/2026.............. 1,870,000 1,910,673
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-46 CL. B
7.500% 03/17/2025.............. 3,900,000 3,986,428
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-G4 CL. C
7.500% 06/17/2024.............. 6,650,000 6,805,309
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-39 CL. B
7.500% 05/17/2027.............. 1,530,000 1,591,935
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-38 CL. L
7.500% 02/17/2012.............. 1,043,645 1,046,264
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-G5 CL. VA
7.500% 07/17/2012.............. 5,700,000 6,029,311
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-63 CL. PH
7.000% 07/18/2026.............. 7,410,000 7,736,096
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-74 CL. D
7.500% 09/20/2023.............. 3,245,000 3,306,976
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-68 CL. PJ
7.000% 10/18/2027.............. $ 3,000,000 $ 3,072,727
-------------
44,029,682
-------------
FHLMC (6.1%)
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1233 CL. H
7.000% 04/15/2007.............. 600,000 620,058
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1543 CL. XN
7.000% 07/15/2023.............. 5,617,000 5,916,118
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1971 CL. E
7.500% 01/20/2024.............. 4,825,552 4,911,847
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1971 CL. A
7.500% 07/15/2027.............. 3,000,000 3,058,835
FHLMC GNMA MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES G62 CL. B
7.500% 05/20/2024.............. 3,756,000 3,844,003
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1995 CL. D
7.500% 08/20/2012.............. 4,078,566 4,104,980
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1995 CL. A
7.500% 08/20/2027.............. 7,200,000 7,598,982
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1627 CL. EA
6.000% 05/15/2023.............. 2,892,000 2,759,623
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1763 CL. H
8.250% 07/15/2023.............. 130,000 137,903
FHLMC GNMA MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES G40 CL. N
6.500% 05/17/2021.............. 7,180,000 7,162,935
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1895 CL. B
7.500% 12/15/2023.............. 3,940,000 4,016,318
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1904 CL. C
7.250% 08/15/2024.............. 3,490,000 3,549,958
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1910 CL. D
8.000% 11/15/2024.............. 2,043,000 2,129,734
</TABLE>
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<TABLE>
<CAPTION>
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1933 CL. AE
7.000% 03/15/2025.............. $ 2,060,000 $ 2,080,733
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1933 CL. C
7.000% 03/15/2025.............. 2,440,000 2,469,173
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1933 CL. VC
7.550% 03/15/2012.............. 2,950,000 3,177,681
-------------
57,538,881
-------------
OTHER AGENCY CMO (0.1%)
PUERTO RICO HOUSING FINANCE CORP.
SERIES A CL. 4
9.000% 07/20/2017.............. 427,270 427,270
-------------
TOTAL U.S. GOVERNMENT, FEDERAL
AGENCY OBLIGATIONS
(COST $228,149,035)............... 234,779,929
-------------
CORPORATE BONDS (13.2%)
INDUSTRIAL (8.8%)
BASIC INDUSTRY & MANUFACTURING (2.5%)
ALUMINUM CO. OF AMERICA (144A)
6.500% 06/15/2018.............. 5,850,000 5,812,911
CATERPILLAR FINANCIAL SERVICES
MEDIUM TERM NOTES
5.800% 03/15/2000.............. 3,890,000 3,891,478
GEORGIA-PACIFIC CORP.
9.950% 06/15/2002.............. 3,061,000 3,440,289
SANTA FE PACIFIC GOLD CORP.
8.375% 07/01/2005.............. 5,100,000 5,496,780
TYCO INTERNATIONAL GROUP S.A.
6.250% 06/15/2003.............. 4,500,000 4,489,065
-------------
23,130,523
-------------
BUSINESS & CONSUMER SERVICES (1.2%)
CINEMARK USA, INC. SERIES B
9.625% 08/01/2008.............. 350,000 360,500
COMCAST CORP.
9.500% 01/15/2008.............. 2,140,000 2,285,178
JONES INTERCABLE, INC.
8.875% 04/01/2007.............. 1,435,000 1,535,450
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
LENFEST COMMUNICATIONS, INC.
8.375% 11/01/2005.............. $ 650,000 $ 690,625
SERVICE CORP. INTERNATIONAL
6.300% 03/15/2003.............. 5,000,000 4,993,250
TIME WARNER ENTERTAINMENT CO.
L.P.
8.375% 03/15/2023.............. 1,320,000 1,546,129
-------------
11,411,132
-------------
CONSUMER CYCLICAL (1.6%)
ECKERD CORP.
9.250% 02/15/2004.............. 4,000,000 4,244,120
HILTON HOTELS CORP.
7.375% 06/01/2002.............. 3,500,000 3,546,655
WAL-MART STORES, INC.
5.650% 02/01/2000.............. 7,375,000 7,353,170
-------------
15,143,945
-------------
CONSUMER STAPLES (1.7%)
AETNA SERVICES, INC.
7.625% 08/15/2026.............. 3,650,000 3,894,185
AMERICAN HOME PRODUCTS CORP.
7.700% 02/15/2000.............. 2,975,000 3,057,705
AMGEN, INC.
8.125% 04/01/2097.............. 2,550,000 3,098,581
COCA-COLA ENTERPRISES, INC.
6.750% 01/15/2038.............. 4,150,000 4,185,524
NABISCO, INC.
6.700% 06/15/2002.............. 2,000,000 2,015,100
-------------
16,251,095
-------------
ENERGY (1.4%)
K N ENERGY, INC.
6.650% 03/01/2005.............. 4,075,000 4,086,369
OCCIDENTAL PETROLEUM CORP.
6.400% 04/01/2003.............. 5,000,000 4,989,950
UNION PACIFIC RESOURCES GROUP
6.750% 05/15/2008.............. 3,850,000 3,844,033
-------------
12,920,352
-------------
TRANSPORTATION (0.4%)
ALLIED HOLDING, INC. SERIES B
8.625% 10/01/2007.............. 500,000 502,500
</TABLE>
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<TABLE>
<CAPTION>
CORPORATE BONDS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
FEDERAL EXPRESS CORP. PASS THRU
TRUST SERIES 1997-1C
7.650% 01/15/2014.............. $ 2,167,837 $ 2,349,610
TEEKAY SHIPPING CORP. GUARANTEED
FIRST PREFERRED SHIPPING MTG.
NOTES
8.320% 02/01/2008.............. 1,000,000 1,035,000
-------------
3,887,110
-------------
FINANCIAL (3.8%)
BANKS-DOMESTIC (0.5%)
AMSOUTH BANK N.A. BIRMINGHAM
6.450% 02/01/2008.............. 700,000 698,425
BANKAMERICA CORP.
5.758% 02/20/2002.............. 3,800,000 3,788,220
-------------
4,486,645
-------------
BANKS-FOREIGN (0.6%)
ABN AMRO BANK N. V. CHICAGO
7.250% 05/31/2005.............. 3,575,000 3,755,788
DEUTSCHE BANK FINANCIAL, INC.
6.700% 12/13/2006.............. 1,550,000 1,590,595
-------------
5,346,383
-------------
FINANCE (1.2%)
BEAR STEARNS CO., INC. MEDIUM
TERM NOTES
5.724% 10/10/2000.............. 3,825,000 3,817,732
GOLDMAN SACHS GROUP L.P. (144A)
7.200% 03/01/2007.............. 2,800,000 2,955,792
HARTFORD LIFE, INC.
7.650% 06/15/2027.............. 2,555,000 2,837,251
MORGAN STANLEY DEAN WITTER
DISCOVER CO. MEDIUM TERM SENIOR
NOTES
5.750% 02/15/2001.............. 2,100,000 2,086,749
-------------
11,697,524
-------------
REIT'S (1.6%)
ERP OPERATING L.P. (144A)
8.500% 05/15/1999.............. 2,700,000 2,750,922
FIRST SECURITY CORP.
7.875% 10/15/1999.............. 1,325,000 1,353,196
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
SECURITY CAPITAL INDUSTRIAL TRUST
MEDIUM TERM NOTES
7.810% 02/01/2015.............. $ 3,250,000 $ 3,495,992
SIMON DEBARTOLO GROUP L.P. (144A)
6.625% 06/15/2003.............. 4,475,000 4,472,136
SPIEKER PROPERTIES L.P.
6.900% 01/15/2004.............. 2,450,000 2,485,231
-------------
14,557,477
-------------
UTILITY (0.5%)
TELECOMMUNICATIONS
CABLE & WIRELESS COMMUNICATIONS
P.L.C.
6.375% 03/06/2003............ 3,950,000 3,953,318
WORLDCOM, INC.
8.875% 01/15/2006............ 1,000,000 1,087,870
-------------
5,041,188
-------------
TOTAL CORPORATE BONDS
(COST $121,922,845)............... 123,873,374
-------------
OTHER SECURITIZED LOANS (7.5%)
ASSET BACKED SECURITIES (2.0%)
CITYSCAPE HOME EQUITY LOAN TRUST
SERIES 1997-B CL. A-7
7.410% 05/25/2028.............. 4,150,000 4,291,253
THE MONEY STORE RESIDENTIAL TRUST
SERIES 1997-II CL. A-4
7.385% 03/15/2029.............. 2,702,000 2,821,887
NEW CENTURY HOME EQUITY LOAN
TRUST SERIES 1997-NC5 CL. A-5
7.130% 10/25/2028.............. 9,000,000 9,230,334
SALOMON BROTHERS MORTGAGE
SECURITIES VII, INC. SERIES
1996-LB2 CL. A-8
7.800% 10/25/2026.............. 2,500,000 2,579,750
-------------
18,923,224
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS (5.5%)
BEAR STEARNS MORTGAGE SECURITIES,
INC. SERIES 1996-2 CL. A-1
6.671% 01/25/2025................ 4,359,970 4,367,186
</TABLE>
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<TABLE>
<CAPTION>
CORPORATE BONDS (CONTINUED)
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
BEAR STEARNS MORTGAGE SECURITIES,
INC. SERIES 1996-8 CL. A-9
7.600% 11/25/2027................ $ 4,777,000 $ 4,822,524
BEAR STEARNS STRUCTURED SECURITIES,
INC. (144A)
SERIES 1995-1 CL. A
6.454% 09/25/2024................ 2,908,445 2,862,084
CMC SECURITIES CORP. IV
SERIES 1997-2 CL. 1A-12
7.250% 11/25/2027................ 6,675,000 6,840,268
CWHL, INC. MTG. PASS THRU CTF.
SERIES 1997-3 CL. A-10
7.500% 06/25/2027................ 1,721,205 1,720,823
DLJ MORTGAGE ACCEPTANCE CORP.
SERIES 1998-2 CL. IIA-8
6.800% 06/25/2028................ 3,720,000 3,739,945
GE CAPITAL MORTGAGE SERVICES, INC.
SERIES 1997-8 CL. A-6
7.250% 10/25/2027................ 2,525,000 2,591,007
HEADLANDS MORTGAGE SECURITIES, INC.
SERIES 1997-3 CL. 1-A-6
7.000% 07/25/2027................ 4,980,000 5,043,037
ICIFC SECURED ASSETS CORP. SERIES
1997-1 CL. A-7
7.750% 03/25/2028................ 2,184,000 2,226,156
MORTGAGE OBLIGATION STRUCTURED
TRUST (144A) SERIES 1993-1 CL. B-1
10.664% 10/25/2018............... 2,954,289 3,070,998
NORWEST ASSET SECURITIES CORP.
SERIES 1997-16 CL. A-2
6.750% 10/25/2027................ 7,015,900 7,040,421
PNC MORTGAGE SECURITIES CORP.
SERIES 1997-4 CL. IIPP-2
7.500% 07/25/2027................ 2,750,000 2,856,064
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
RESIDENTIAL FUNDING MORTGAGE
SECURITIES I, INC. SERIES 1997-S7
CL. A-3
7.500% 05/25/2027................ $ 3,171,000 $ 3,272,466
STRUCTURED ASSET MORTGAGE
INVESTMENTS, INC. SERIES 1998-8
CL. 1-8-A
7.000% 07/25/2028................ 1,634,000 1,658,510
-------------
52,111,489
-------------
TOTAL OTHER SECURITIZED LOANS
(COST $69,612,176)................ 71,034,713
-------------
TOTAL INVESTMENTS, EXCLUDING
TEMPORARY CASH INVESTMENT
(COST $787,729,778)............... 919,367,988
-------------
REPURCHASE AGREEMENT (2.4%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $22,896,578.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023.
(COST $22,892,921).................. 22,892,921 22,892,921
-------------
TOTAL INVESTMENTS (100.0%)
(COST $810,622,699)................... 942,260,909
RECEIVABLES LESS LIABILITIES (0.0%).... (430,522)
-------------
NET ASSETS (100.0%).................... $ 941,830,387
-------------
-------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
* Non-income producing.
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
COMMERCIAL PAPER (100.5%)
AIR PRODUCTS & CHEMICALS, INC.
5.500% 09/25/1998................ $ 6,000,000 $ 5,920,251
5.500% 09/30/1998................ 3,500,000 3,450,806
ALABAMA POWER CO.
5.850% 07/07/1998................ 9,687,000 9,675,981
5.490% 08/20/1998................ 9,000,000 8,930,002
AMERICAN EXPRESS CREDIT CORP.
5.520% 07/20/1998................ 6,000,000 5,981,600
5.500% 08/06/1998................ 12,000,000 11,932,167
5.510% 08/07/1998................ 6,000,000 5,965,103
5.520% 08/21/1998................ 9,000,000 8,928,240
AMERICAN GENERAL CORP.
5.480% 08/13/1998................ 15,000,000 14,899,533
5.500% 09/11/1998................ 5,000,000 4,944,237
AMERICAN GENERAL FINANCE CORP.
5.500% 09/02/1998................ 8,000,000 7,921,778
AMGEN, INC.
5.510% 09/22/1998................ 20,000,000 19,742,867
ARCHER-DANIELS-MIDLAND CO.
5.490% 07/07/1998................ 7,000,000 6,992,527
5.480% 07/15/1998................ 10,000,000 9,977,167
5.510% 07/27/1998................ 6,000,000 5,975,205
ATLANTIC RICHFIELD CO.
5.470% 07/10/1998................ 10,000,000 9,984,806
5.510% 08/26/1998................ 15,000,000 14,869,138
5.530% 08/28/1998................ 5,000,000 4,954,685
AVCO FINANCIAL SERVICES, INC.
5.510% 07/30/1998................ 8,000,000 7,963,267
5.510% 08/27/1998................ 6,000,000 5,946,737
5.530% 11/03/1998................ 7,000,000 6,864,516
BANK OF AMERICA, FSB
5.500% 08/12/1998................ 10,000,000 9,934,306
5.540% 08/26/1998................ 10,000,000 9,912,284
BECTON, DICKINSON & CO.
5.470% 07/09/1998................ 8,000,000 7,989,060
5.470% 07/14/1998................ 13,000,000 12,972,346
BENEFICIAL CORP.
5.530% 07/24/1998................ 5,000,000 4,981,567
5.510% 09/03/1998................ 20,000,000 19,801,028
5.520% 09/04/1998................ 10,000,000 9,898,800
CIT GROUP HOLDINGS, INC.
5.520% 08/14/1998................ 13,000,000 12,910,300
5.500% 09/04/1998................ 12,000,000 11,879,000
CARGILL, INC.
5.470% 07/01/1998................ 12,500,000 12,498,100
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
CARGILL FINANCIAL SERVICES
CORP.
5.480% 07/08/1998................ $ 6,000,000 $ 5,992,693
CATERPILLAR FINANCIAL SERVICES
CORP.
5.620% 07/01/1998................ 8,100,000 8,098,735
5.700% 07/06/1998................ 5,800,000 5,794,490
CHEVRON TRANSPORT CO.
5.520% 07/21/1998................ 5,000,000 4,983,900
5.480% 07/23/1998................ 9,000,000 8,968,490
5.480% 08/10/1998................ 10,000,000 9,937,589
COMMERCIAL CREDIT CO.
5.490% 07/20/1998................ 7,000,000 6,978,650
5.520% 07/21/1998................ 13,000,000 12,958,140
5.500% 09/11/1998................ 5,000,000 4,944,237
EASTMAN KODAK CO.
5.510% 07/02/1998................ 4,215,000 4,213,710
5.500% 07/08/1998................ 8,300,000 8,289,856
5.500% 07/13/1998................ 10,000,000 9,980,139
5.530% 07/20/1998................ 4,000,000 3,987,711
5.530% 08/17/1998................ 6,200,000 6,154,286
DEERE & CO.
5.510% 08/12/1998................ 8,000,000 7,947,349
DEERE (JOHN) CAPITAL CORP.
5.500% 07/06/1998................ 8,000,000 7,992,667
5.520% 07/30/1998................ 10,000,000 9,954,000
5.510% 09/02/1998................ 5,000,000 4,951,023
DISNEY (WALT) CO.
6.150% 07/01/1998................ 15,000,000 14,997,437
DUPONT (E.I.) DE NEMOURS & CO.
5.480% 09/03/1998................ 7,000,000 6,930,739
5.480% 09/04/1998................ 8,000,000 7,919,627
FLORIDA POWER CORP.
5.520% 07/02/1998................ 5,000,000 4,998,467
FORD MOTOR CREDIT CO.
6.000% 07/01/1998................ 8,000,000 7,998,667
5.700% 07/07/1998................ 8,900,000 8,890,136
5.470% 07/16/1998................ 10,000,000 9,975,689
5.580% 07/17/1998................ 5,000,000 4,986,825
5.510% 07/22/1998................ 9,000,000 8,969,695
GTE FUNDING, INC.
5.530% 07/08/1998................ 8,000,000 7,990,169
5.600% 07/27/1998................ 3,738,000 3,722,301
GENERAL ELECTRIC CAPITAL CORP.
5.490% 07/17/1998................ 6,000,000 5,984,445
5.520% 09/02/1998................ 5,000,000 4,950,934
5.490% 10/02/1998................ 6,000,000 5,913,990
5.500% 10/22/1998................ 5,000,000 4,912,918
</TABLE>
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<TABLE>
<CAPTION>
COMMERCIAL PAPER (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
GENERAL MOTORS
ACCEPTANCE CORP.
5.490% 08/31/1998................ $ 7,000,000 $ 6,933,815
5.490% 09/18/1998................ 13,000,000 12,841,400
5.490% 10/30/1998................ 13,000,000 12,758,135
GOLDMAN SACHS GROUP L.P.
5.510% 08/18/1998................ 7,000,000 6,947,502
5.510% 08/19/1998................ 10,000,000 9,923,472
5.500% 09/17/1998................ 8,000,000 7,903,445
5.500% 10/27/1998................ 10,000,000 9,818,195
HERSHEY FOODS CORP.
5.500% 07/22/1998................ 2,800,000 2,790,589
HOUSEHOLD FINANCE CORP.
5.510% 08/04/1998................ 10,000,000 9,946,431
5.500% 08/05/1998................ 8,000,000 7,956,000
5.510% 09/01/1998................ 10,000,000 9,903,575
LUBRIZOL CORP.
5.500% 09/10/1998................ 5,000,000 4,945,001
MARSH & MCLENNAN COS., INC.
5.450% 08/10/1998................ 9,000,000 8,944,137
5.450% 08/11/1998................ 10,000,000 9,936,417
MERRILL LYNCH & CO., INC.
6.000% 07/02/1998................ 5,500,000 5,498,167
5.530% 07/23/1998................ 8,000,000 7,971,736
5.530% 08/14/1998................ 6,000,000 5,958,525
5.480% 08/17/1998................ 8,000,000 7,941,547
5.520% 08/28/1998................ 5,000,000 4,954,767
5.520% 09/15/1998................ 8,000,000 7,905,547
METLIFE FUNDING, INC.
5.540% 08/24/1998................ 10,000,000 9,915,362
MINNESOTA MINING & MANUFACTURING
CO.
5.470% 07/22/1998................ 7,000,000 6,976,601
MONSANTO CO.
5.500% 09/16/1998................ 8,000,000 7,904,667
5.500% 09/17/1998................ 10,000,000 9,879,306
5.500% 09/22/1998................ 2,800,000 2,764,067
5.490% 10/08/1998................ 6,000,000 5,908,500
MORGAN (J.P.) & CO., INC.
5.470% 07/16/1998................ 15,000,000 14,963,533
5.520% 09/10/1998................ 5,000,000 4,944,800
5.500% 09/14/1998................ 10,000,000 9,883,889
5.500% 11/16/1998................ 6,000,000 5,872,584
NALCO CHEMICAL CO.
5.510% 07/28/1998................ 10,000,000 9,957,145
5.700% 07/28/1998................ 9,000,000 8,960,100
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
NATIONAL RURAL UTILITIES
COOPERATIVE FINANCE CORP.
5.460% 07/17/1998................ $10,000,000 $ 9,974,217
5.520% 07/20/1998................ 5,500,000 5,483,133
5.500% 08/25/1998................ 5,000,000 4,957,223
NORWEST FINANCIAL, INC.
5.470% 07/24/1998................ 7,000,000 6,974,473
5.500% 07/29/1998................ 10,000,000 9,955,695
5.510% 07/31/1998................ 14,000,000 13,933,574
PACIFICORP
5.520% 07/07/1998................ 10,000,000 9,989,267
5.510% 07/14/1998................ 8,000,000 7,982,858
5.520% 08/25/1998................ 10,000,000 9,914,133
PITNEY BOWES CREDIT CORP.
5.750% 07/09/1998................ 1,100,000 1,098,419
PRUDENTIAL FUNDING CORP.
5.520% 07/09/1998................ 6,000,000 5,991,720
5.490% 08/07/1998................ 8,000,000 7,953,640
5.470% 08/11/1998................ 13,000,000 12,917,039
5.500% 08/21/1998................ 8,000,000 7,936,445
ST. PAUL COS., INC.
5.510% 07/02/1998................ 8,000,000 7,997,551
5.520% 08/06/1998................ 10,000,000 9,943,267
SONOCO PRODUCTS CO.
5.520% 07/06/1998................ 10,000,000 9,990,800
TEXACO, INC.
5.470% 07/10/1998................ 9,000,000 8,986,325
5.510% 08/03/1998................ 13,000,000 12,932,350
5.510% 08/05/1998................ 8,000,000 7,955,920
USAA CAPITAL CORP.
5.470% 07/14/1998................ 7,000,000 6,985,109
5.470% 10/21/1998................ 8,000,000 7,862,643
U.S. BANCORP
5.500% 07/13/1998................ 10,000,000 9,980,139
5.500% 07/24/1998................ 10,000,000 9,963,334
5.510% 08/17/1998................ 15,000,000 14,889,800
XEROX CREDIT CORP.
5.490% 07/15/1998................ 8,000,000 7,981,700
5.490% 08/11/1998................ 4,000,000 3,974,380
5.500% 11/06/1998................ 2,000,000 1,960,584
---------------
TOTAL COMMERCIAL PAPER
(COST $1,032,041,803)............. 1,032,041,803
---------------
</TABLE>
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<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------ ---------------
<S> <C> <C>
REPURCHASE AGREEMENT (0.2%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $1,912,389
COLLATERALIZED BY U.S. TREASURY
BONDS
6.250% DUE 08/15/2023.
(COST $1,912,084)................. $ 1,912,084 $ 1,912,084
---------------
TOTAL INVESTMENTS (100.7%)
(COST $1,033,953,887, INCLUDING
$6,628,430 ACCRUED INTEREST
RECEIVABLE)........................... 1,033,953,887
CASH AND RECEIVABLES LESS LIABILITIES
(-0.7%)............................... (7,578,635)
---------------
NET ASSETS (100.0%).................... $ 1,026,375,252
---------------
---------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part of the financial statements.
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<TABLE>
<CAPTION>
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
------------ ------------
<S> <C> <C>
U.S. TREASURY NOTES (98.9%)
6.875% 08/31/1999................ $ 1,325,000 $ 1,344,254
5.875% 11/15/1999................ 4,375,000 4,394,141
5.875% 02/15/2000................ 10,500,000 10,554,138
5.625% 11/30/2000................ 12,700,000 12,725,793
6.375% 03/31/2001................ 9,450,000 9,649,338
------------
TOTAL U.S. TREASURY NOTES
(COST $38,607,933)................ 38,667,664
REPURCHASE AGREEMENT (1.4%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $563,360.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023.
(COST $563,270)................... 563,270 563,270
------------
TOTAL INVESTMENTS (100.3%)
(COST $39,171,203).................... 39,230,934
RECEIVABLES LESS LIABILITIES (-0.3%)... (107,998)
------------
NET ASSETS (100.0%).................... $ 39,122,936
------------
------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (55.0%)
U.S. TREASURY BONDS & NOTES (17.0%)
U.S. TREASURY BONDS
12.000% 05/15/2005............... $ 4,880,000 $ 6,654,339
8.875% 08/15/2017................ 17,260,000 23,527,537
8.125% 08/15/2019................ 19,815,000 25,564,441
U.S. TREASURY NOTES
6.500% 08/31/2001................ 14,050,000 14,427,594
-------------
70,173,911
-------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) (5.8%)
7.000% 11/15/2027 - 7/15/2028.... 20,366,969 20,700,173
7.500% 01/15/2028................ 3,081,781 3,168,779
-------------
23,868,952
-------------
FEDERAL HOUSING ADMINISTRATION (FHA) (0.8%)
FHA INSURED PROJECT POOL #051-11078
8.350% 04/01/2030................ 2,210,632 2,378,161
FHA INSURED PROJECT POOL #092-35499
8.450% 11/15/2031................ 787,845 821,328
-------------
3,199,489
-------------
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS (31.4%)
GNMA (4.7%)
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-4 CL. M
7.500% 02/16/2012.............. 2,829,043 2,843,523
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-4 CL. N
7.500% 02/16/2027.............. 4,007,202 4,135,528
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-11 CL. M
8.000% 05/16/2024.............. 1,640,000 1,696,735
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1996-23 CL. C
7.500% 12/20/2022.............. 3,607,000 3,714,094
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1997-2 CL. K
7.500% 01/20/2024.............. 2,410,000 2,494,886
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1998-1 CL. A
7.000% 01/20/2028.............. 1,890,000 1,937,164
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
GNMA GTD. REMIC PASS THRU SECS.
REMIC TR. 1998-9 CL. B
6.850% 12/20/2025.............. $ 2,260,000 $ 2,280,475
-------------
19,102,405
-------------
FNMA (16.0%)
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1991-94 CL. C
0.000% 01/25/1999.............. 310,649 308,027
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-G1 CL. B
7.500% 06/20/2024.............. 7,760,000 8,023,594
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-17 CL. PE
7.000% 01/18/2026.............. 3,610,000 3,688,518
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-24 CL. YL
7.000% 04/18/2027.............. 3,406,000 3,525,278
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-G4 CL. C
7.500% 06/17/2024.............. 7,333,000 7,504,261
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-39 CL. B
7.500% 05/17/2027.............. 2,673,000 2,781,204
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-38 CL. G
7.500% 05/17/2026.............. 1,672,062 1,709,829
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-38 CL. H
7.500% 05/17/2027.............. 1,766,000 1,858,112
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-38 CL. L
7.500% 02/17/2012.............. 2,543,884 2,550,269
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-43 CL. B
7.500% 08/18/2025.............. 9,840,000 10,087,579
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-44 CL. PG
7.000% 02/18/2024.............. 4,120,000 4,249,435
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-G5 CL. VD
7.250% 04/17/2010.............. 3,600,000 3,744,345
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-63 CL. PH
7.000% 07/18/2026.............. 7,500,000 7,830,057
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-75 CL. B
6.500% 09/18/2026.............. 3,070,660 3,062,771
</TABLE>
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<TABLE>
<CAPTION>
U.S. GOVERNMENT, FEDERAL AGENCY OBLIGATIONS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
FNMA GTD. REMIC PASS THRU CTF.
REMIC TR. 1997-74 CL. D
7.500% 09/20/2023.............. $ 4,940,000 $ 5,034,349
-------------
65,957,628
-------------
FHLMC (10.5%)
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1558 CL. C
6.500% 07/15/2023.............. 2,141,000 2,139,833
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1971 CL. E
7.500% 01/20/2024.............. 10,120,147 10,301,126
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1971 CL. A
7.500% 07/15/2027.............. 4,041,000 4,120,251
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1995 CL. D
7.500% 08/20/2012.............. 7,129,796 7,175,969
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1995 CL. A
7.500% 08/20/2027.............. 3,300,000 3,482,867
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1763 CL. H
8.250% 07/15/2023.............. 692,000 734,070
FHLMC GNMA MULTICLASS MTG.
PARTN. CTFS GTD. SERIES G40 CL. N
6.500% 05/17/2021.............. 4,700,000 4,688,829
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1910 CL. D
8.000% 11/15/2024.............. 1,970,000 2,053,635
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1933 CL. AE
7.000% 03/15/2025.............. 5,156,300 5,208,197
FHLMC MULTICLASS MTG. PARTN.
CTFS. GTD. SERIES 1933 CL. C
7.000% 03/15/2025.............. 3,316,818 3,356,474
-------------
43,261,251
-------------
OTHER AGENCY CMO (0.2%)
PUERTO RICO HOUSING FINANCE CORP.
SERIES A CL. 4
9.000% 07/20/2017.............. 773,706 773,706
-------------
TOTAL U.S. GOVERNMENT, FEDERAL
AGENCY OBLIGATIONS
(COST $219,647,253)............... 226,337,342
-------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
CORPORATE BONDS (27.5%)
INDUSTRIAL (14.5%)
BASIC INDUSTRY & MANUFACTURING (5.2%)
FOSTER WHEELER CORP.
6.750% 11/15/2005.............. $ 2,925,000 $ 2,908,942
GENERAL ELECTRIC CAPITAL CORP.
MEDIUM TERM NOTES
6.350% 09/15/2001.............. 3,200,000 3,245,472
GEORGIA-PACIFIC CORP.
9.950% 06/15/2002.............. 3,250,000 3,652,707
ICI WILMINGTON, INC.
7.050% 09/15/2007.............. 3,805,000 4,002,365
PRECISION CASTPARTS CORP.
6.750% 12/15/2007.............. 1,650,000 1,671,582
TYCO INTERNATIONAL GROUP S.A.
6.125% 06/15/2001.............. 500,000 500,410
6.250% 06/15/2003.............. 5,575,000 5,561,453
-------------
21,542,931
-------------
BUSINESS & CONSUMER SERVICES (2.2%)
HERITAGE MEDIA CORP.
8.750% 02/15/2006.............. 1,250,000 1,331,250
HOLLINGER INTERNATIONAL
PUBLISHING, INC.
8.625% 03/15/2005.............. 300,000 313,500
LENFEST COMMUNICATIONS, INC.
8.375% 11/01/2005.............. 1,350,000 1,434,375
NEWS AMERICA, INC.
6.750% 01/09/2038.............. 2,825,000 2,828,701
TIME WARNER ENTERTAINMENT CO.
L.P.
8.375% 03/15/2023.............. 2,600,000 3,045,406
-------------
8,953,232
-------------
CONSUMER CYCLICAL (2.3%)
HILTON HOTELS CORP.
7.375% 06/01/2002.............. 4,000,000 4,053,320
SEARS ROEBUCK ACCEPTANCE CORP.
MEDIUM TERM NOTES SERIES I
6.400% 10/11/2000.............. 4,525,000 4,566,902
SPECIALTY RETAILERS, INC. SERIES
B
8.500% 07/15/2005.............. 1,000,000 1,025,000
-------------
9,645,222
-------------
</TABLE>
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<TABLE>
<CAPTION>
CORPORATE BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
CONSUMER STAPLES (3.9%)
AETNA SERVICES, INC.
7.625% 08/15/2026.............. $ 5,000,000 $ 5,334,500
COCA-COLA ENTERPRISES, INC.
6.750 % 01/15/2038............. 3,850,000 3,882,956
NABISCO, INC.
6.000% 02/15/2001.............. 1,875,000 1,848,975
6.700% 06/15/2002.............. 3,750,000 3,778,313
TENET HEALTHCARE CORP.
8.625% 12/01/2003.............. 990,000 1,039,500
-------------
15,884,244
-------------
ENERGY (0.3%)
GULF CANADA RESOURCES LTD.
9.625% 07/01/2005.............. 1,250,000 1,362,500
-------------
TRANSPORTATION (0.6%)
FEDERAL EXPRESS CORP. PASS THRU
TRUST SERIES 1997-1C
7.650% 01/15/2014.............. 2,266,375 2,456,410
-------------
FINANCIAL (8.6%)
BANKS-DOMESTIC (2.6%)
BANKAMERICA CORP.
5.758% 02/20/2002.............. 3,500,000 3,489,150
FIRST BANK SYSTEM, INC.
5.875% 11/26/2010.............. 7,230,000 7,193,850
-------------
10,683,000
-------------
BANKS-FOREIGN (1.2%)
DEUTSCHE BANK FINANCIAL, INC.
6.700% 12/13/2006.............. 2,850,000 2,924,642
SWISS BANK CORP. N.Y.
7.250% 09/01/2006.............. 1,825,000 1,944,282
-------------
4,868,924
-------------
FINANCE (1.2%)
EQUITABLE COS., INC.
9.000% 12/15/2004.............. 855,000 976,786
GOLDMAN SACHS GROUP L.P. (144A)
7.200% 03/01/2007.............. 3,700,000 3,905,868
-------------
4,882,654
-------------
REIT'S (3.6%)
AMERICAN HEALTH PROPERTIES, INC.
7.500% 01/15/2007.............. 650,000 666,640
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
EOP OPERATING L.P. (144A)
6.376% 02/15/2002.............. $ 3,925,000 $ 3,911,066
HEALTH CARE PROPERTY INVESTMENTS,
INC.
6.500% 02/15/2006.............. 6,400,000 6,263,040
SIMON DEBARTOLO GROUP L.P. (144A)
6.625% 06/15/2003.............. 4,150,000 4,147,344
-------------
14,988,090
-------------
UTILITIES (3.0%)
ELECTRIC (1.7%)
CALENERGY, INC.
9.875% 06/30/2003.............. 1,000,000 1,070,010
NIAGARA MOHAWK POWER CORP. SERIES
D
7.250% 10/01/2002.............. 1,950,000 1,948,674
NORTHERN INDIANA PUBLIC SERVICE
CO. MEDIUM TERM NOTES
6.900% 06/01/2000.............. 1,250,000 1,272,050
6.750% 06/01/2000.............. 2,500,000 2,537,450
-------------
6,828,184
-------------
TELECOMMUNICATIONS (1.3%)
FLAG LTD. (144A)
8.250% 01/30/2008.............. 500,000 503,750
MCI COMMUNICATIONS CORP.
6.125% 04/15/2002.............. 555,000 552,935
WORLDCOM, INC.
8.875% 01/15/2006.............. 900,000 979,083
US WEST CAPITAL FUNDING, INC.
6.875% 07/15/2028.............. 3,250,000 3,250,260
-------------
5,286,028
-------------
YANKEE (1.4%)
OTHER (1.4%)
AFRICAN DEVELOPMENT BANK MEDIUM
TERM NOTES
8.625% 05/01/2001.............. 5,300,000 5,678,897
-------------
TOTAL CORPORATE BONDS
(COST $111,378,361)............... 113,060,316
-------------
OTHER SECURITIZED LOANS (15.1%)
ASSET BACKED SECURITIES (3.2%)
EMPIRE FUNDING HOME LOAN OWNER
TRUST SERIES 1997-2 CL. A-5
7.960% 09/25/2023................ 2,796,000 2,924,569
</TABLE>
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<TABLE>
<CAPTION>
OTHER SECURITIZED LOANS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
SALOMON BROTHERS MORTGAGE
SECURITIES VII, INC. SERIES
1996-LB2 CL. A-8
7.800% 10/25/2026................ $ 1,000,000 $ 1,031,900
SAXON ASSET SECURITIES CO. SERIES
1996-1 CL. A-2
8.060% 09/25/2027................ 6,265,000 6,547,176
STRUCTURED ASSET SECURITIES CORP.
SERIES 1997-4 CL. 2-A2
7.000% 12/25/2027................ 2,500,000 2,534,899
-------------
13,038,544
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS (11.9%)
BEAR STEARNS MORTGAGE SECURITIES,
INC. SERIES 1996-2 CL. A-1
6.618% 01/25/2025................ 4,144,430 4,151,290
CMC SECURITIES CORP. IV SERIES
1997-2 CL. IA-12
7.250% 11/25/2027................ 2,860,000 2,930,811
DLJ MORTGAGE ACCEPTANCE CORP.
SERIES 1998-2 CL. II-A-8
6.800% 06/25/2028................ 4,270,000 4,292,893
GE CAPITAL MORTGAGE SERVICES, INC.
SERIES 1997-8 CL. A-6
7.250% 10/25/2027................ 2,480,000 2,544,831
GE CAPITAL MORTGAGE SERVICES, INC.
SERIES 1997-8 CL. A-7
7.250% 10/25/2027................ 9,352,184 9,381,527
ICIFC SECURED ASSETS CORP. SERIES
1997-1 CL. A-7
7.750% 03/25/2028................ 2,660,000 2,711,344
MORTGAGE OBLIGATION STRUCTURED
TRUST (144A) SERIES 1993-1 CL. B1
10.664% 10/25/2018............... 2,340,030 2,432,473
NORWEST ASSET SECURITIES CORP.
SERIES 1997-16 CL. A-2
6.750% 10/25/2027................ 14,080,000 14,129,211
PNC MORTGAGE SECURITIES CORP.
SERIES 1997-4 CL. IIPP-2
7.500% 07/25/2027................ 2,995,000 3,110,513
RESIDENTIAL FUNDING MORTGAGE
SECURITIES, INC. SERIES 1993-S45
CL. A-10
8.000% 12/25/2023................ 1,250,000 1,282,609
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
------------ -------------
<S> <C> <C>
STRUCTURED ASSET MORTGAGE
INVESTMENTS, INC. SERIES 1998-8
CL. 1-8-A
7.000% 07/25/2028................ $ 2,000,000 $ 2,030,000
-------------
48,997,502
-------------
TOTAL OTHER SECURITIZED LOANS
(COST $60,832,606)................ 62,036,046
-------------
TOTAL INVESTMENTS, EXCLUDING
TEMPORARY CASH INVESTMENTS
(COST $391,858,220)............... 401,433,704
-------------
REPURCHASE AGREEMENTS (5.4%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $ 16,476,355.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023............. 16,473,724 16,473,724
J.P. MORGAN SECURITIES, INC.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $6,000,958.
COLLATERALIZED BY
U.S. TREASURY NOTES
5.625% TO 6.750%
DUE 04/30/2000 TO 12/31/2002...... 6,000,000 6,000,000
-------------
TOTAL REPURCHASE AGREEMENTS
(COST $22,473,724)................ 22,473,724
-------------
TOTAL INVESTMENTS (103.0%)
(COST $414,331,944)................... 423,907,428
RECEIVABLES LESS LIABILITIES (-3.0%)... (12,371,186)
-------------
NET ASSETS (100.0%).................... $ 411,536,242
-------------
-------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
STATE OF OREGON GENERAL OBLIGATION BONDS (8.1%)
BOARD OF HIGHER EDUCATION REFUNDING
SERIES B
6.250% 10/15/2012................ $ 740,000 $ 796,425
BOARD OF HIGHER EDUCATION SERIES A
0.000% 08/01/2014................ 450,000 203,625
5.900% 08/01/2018................ 1,000,000 1,068,750
ELDERLY & DISABLED HOUSING
REFUNDING SERIES B
6.250% 08/01/2013................ 1,000,000 1,086,250
POLLUTION CONTROL SERIES C
5.625% 06/01/2013................ 2,545,000 2,576,812
5.900% 06/01/2014................ 3,270,000 3,327,225
VETERANS' WELFARE
9.000% 10/01/2000................ 1,010,000 1,119,837
11.000% 12/01/2000................ 865,000 1,003,400
0.000% 07/01/2001................ 1,200,000 1,065,000
6.000% 08/01/2002................ 2,000,000 2,147,500
6.000% 02/01/2004................ 695,000 754,944
9.000% 04/01/2004................ 280,000 346,150
9.000% 04/01/2005................ 1,060,000 1,344,875
8.250% 07/01/2005................ 500,000 616,250
9.000% 10/01/2005................ 1,640,000 2,109,450
7.250% 01/01/2007................ 1,485,000 1,780,144
9.200% 04/01/2007................ 2,370,000 3,172,838
8.250% 07/01/2007................ 540,000 689,850
9.200% 10/01/2007................ 1,250,000 1,693,750
7.300% 01/01/2008................ 255,000 310,781
8.000% 01/01/2008................ 1,220,000 1,546,350
7.300% 07/01/2008................ 1,125,000 1,380,938
8.000% 07/01/2008................ 480,000 613,800
5.850% 10/01/2015................ 1,075,000 1,155,625
5.200% 10/01/2018................ 2,000,000 2,005,000
-------------
TOTAL STATE OF OREGON GENERAL
OBLIGATION BONDS
(COST $32,016,030)................ 33,915,569
-------------
OREGON GENERAL OBLIGATION BONDS (18.6%)
CLACKAMAS & WASHINGTON COUNTIES
SCHOOL DISTRICT #3JT WEST
LINN-WILSONVILLE
5.875% 10/01/2009................ 2,550,000 2,731,687
CLACKAMAS COUNTY SCHOOL DISTRICT
#7J LAKE OSWEGO SERIES A
5.300% 06/15/2005................ 1,000,000 1,051,250
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
5.500% 06/15/2006................ $1,000,000 $ 1,060,000
5.700% 06/15/2010................ 2,735,000 2,892,262
CLACKAMAS COMMUNITY COLLEGE
DISTRICT
5.250% 12/01/2009................ 1,270,000 1,350,962
DESCHUTES COUNTY ADMINISTRATIVE
SCHOOL DISTRICT #1
5.000% 12/01/2017................ 1,500,000 1,490,625
DESCHUTES COUNTY ADMINISTRATIVE
SCHOOL DISTRICT #1 BEND-LAPINE
0.000% 02/01/2000................ 1,175,000 1,104,500
0.000% 02/01/2001................ 1,135,000 1,024,337
0.000% 02/01/2002................ 1,445,000 1,249,925
EUGENE PUBLIC SAFETY
6.000% 06/01/2005................ 850,000 935,000
EUGENE PUBLIC SAFETY FACILITIES
5.625% 06/01/2013................ 1,295,000 1,371,081
JACKSON COUNTY SCHOOL DISTRICT
#549C MEDFORD
5.375% 06/01/2012................ 1,200,000 1,236,000
LANE COUNTY AREA EDUCATION DISTRICT
LANE COMMUNITY COLLEGE
5.300% 06/01/2007................ 1,000,000 1,066,250
4.850% 06/01/2008................ 4,080,000 4,212,600
5.000% 06/01/2009................ 1,000,000 1,043,750
LANE COUNTY SCHOOL DISTRICT #4J
EUGENE
0.000% 01/01/2003................ 1,345,000 1,112,987
0.000% 01/01/2005................ 1,395,000 1,051,481
LANE COUNTY SCHOOL DISTRICT #4J
EUGENE REFUNDING SERIES A
0.000% 07/01/2001................ 2,015,000 1,785,794
0.000% 07/01/2003................ 1,480,000 1,198,800
0.000% 07/01/2005................ 2,325,000 1,714,687
METRO OPEN SPACES PROGRAM SERIES C
5.100% 09/01/2009................ 2,375,000 2,455,156
METRO WASHINGTON PARK ZOO SERIES A
5.250% 01/15/2009................ 1,040,000 1,092,000
5.300% 01/15/2011................ 1,000,000 1,043,750
</TABLE>
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<CAPTION>
OREGON GENERAL OBLIGATION BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
MULTNOMAH-CLACKAMAS COUNTIES SCHOOL
DISTRICT #10JT GRESHAM
5.250% 06/01/2017................ $1,620,000 $ 1,642,275
MULTNOMAH-CLACKAMAS COUNTIES SCHOOL
DISTRICT #51JT RIVERDALE
5.750% 06/01/2016................ 2,270,000 2,394,850
MULTNOMAH COUNTY CERTIFICATE
PARTICIPATION
4.550% 08/01/2010................ 2,725,000 2,697,750
MULTNOMAH COUNTY PUBLIC
IMPROVEMENTS
5.250% 10/01/2013................ 1,800,000 1,845,000
MULTNOMAH COUNTY SCHOOL DISTRICT #7
REYNOLDS
5.250% 06/01/2011................ 1,500,000 1,554,375
MULTNOMAH COUNTY SCHOOL DISTRICT
#40 DAVID DOUGLAS
7.100% 06/01/2002................ 880,000 972,400
PORT OF PORTLAND SERIES A
0.000% 03/01/2007................ 3,000,000 2,040,000
PORTLAND PUBLIC IMPROVEMENTS SERIES
A
5.750% 06/01/2014................ 2,355,000 2,428,594
PORTLAND RECREATIONAL FACILITIES
IMPROVEMENTS SERIES A
5.750% 06/01/2012................ 1,370,000 1,459,050
5.750% 06/01/2013................ 1,345,000 1,430,744
5.750% 06/01/2015................ 1,155,000 1,225,744
PORTLAND RECREATIONAL FACILITIES
IMPROVEMENTS SERIES B
5.500% 06/01/2009................ 2,115,000 2,244,544
5.750% 06/01/2014................ 1,750,000 1,857,188
5.750% 06/01/2015................ 2,955,000 3,135,994
PORTLAND COMMUNITY COLLEGE DISTRICT
0.000% 07/01/2007................ 2,025,000 1,356,750
TRI-COUNTY METROPOLITAN
TRANSPORTATION DISTRICT LIGHT RAIL
EXTENSION SERIES A
6.000% 07/01/2012................ 3,495,000 3,717,806
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
TUALATIN HILLS PARK & RECREATION
DISTRICT
5.700% 03/01/2009................ $1,340,000 $ 1,430,450
5.750% 03/01/2010................ 730,000 778,363
WASHINGTON COUNTY REFUNDING
6.200% 12/01/2007................ 1,500,000 1,591,875
WASHINGTON & CLACKAMAS COUNTIES
SCHOOL DISTRICT #23J TIGARD
REFUNDING
5.400% 01/01/2010................ 1,720,000 1,784,500
WASHINGTON COUNTY SCHOOL DISTRICT
#48J BEAVERTON SERIES B
6.150% 06/01/2008................ 1,010,000 1,049,138
WASHINGTON COUNTY SCHOOL DISTRICT
#48J BEAVERTON SERIES C
7.800% 06/01/2003................ 1,200,000 1,389,000
WASHINGTON, MULTNOMAH & YAMHILL
COUNTIES SCHOOL DISTRICT #1J
5.000% 11/01/2011................ 1,100,000 1,130,250
WILSONVILLE LIMITED TAX IMPROVEMENT
5.000% 12/01/2020................ 1,325,000 1,325,027
-------------
TOTAL OREGON GENERAL OBLIGATION
BONDS
(COST $73,873,476)................ 77,756,551
-------------
OREGON REVENUE BONDS (15.4%)
ALBANY HOSPITAL FACILITY AUTHORITY
MENNONITE HOME
5.625% 10/01/2017................ 375,000 383,437
CLACKAMAS COUNTY HOSPITAL FACILITY
AUTHORITY ROBISON JEWISH HOME
PROJECT
6.250% 10/01/2021................ 2,000,000 2,015,180
CLACKAMAS COUNTY HOSPITAL FACILITY
AUTHORITY WILLAMETTE VIEW, INC.
PROJECT
6.000% 11/01/2008................ 435,000 468,712
CLACKAMAS COUNTY HOSPITAL FACILITY
AUTHORITY GNMA COLLATERAL JENNINGS
LODGE
7.500% 10/20/2031................ 1,030,000 1,100,812
CLACKAMAS COUNTY HOUSING AUTHORITY
MULTIFAMILY HOUSING EASTON RIDGE
SERIES A
5.800% 12/01/2016................ 2,255,000 2,348,019
</TABLE>
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<CAPTION>
OREGON REVENUE BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
DESCHUTES COUNTY HOSPITAL FACILITY
AUTHORITY
5.750% 01/01/2009................ $1,670,000 $ 1,757,675
DESCHUTES VALLEY WATER DISTRICT
5.875% 09/01/2005................ 3,420,000 3,697,875
EUGENE ELECTRIC UTILITY REFUNDING
5.800% 08/01/2008................ 1,435,000 1,504,956
5.800% 08/01/2009................ 1,300,000 1,358,500
6.000% 08/01/2011................ 1,375,000 1,445,469
GRESHAM SEWER
5.350% 06/01/2006................ 860,000 908,375
GRESHAM STORMWATER
6.100% 10/01/2009................ 1,115,000 1,218,137
HILLSBORO HOSPITAL FACILITY
AUTHORITY TUALITY HEALTHCARE
5.750% 10/01/2012................ 3,395,000 3,522,313
LEBANON WASTEWATER REFUNDING
5.750% 06/01/2011................ 1,225,000 1,280,125
NORTH CLACKAMAS PARKS & RECREATION
DISTRICT RECREATIONAL FACILITIES
5.700% 04/01/2013................ 2,840,000 2,974,900
NORTHERN WASCO COUNTY PEOPLE'S
UTILITY DISTRICT ELECTRIC
0.000% 02/01/2006................ 610,000 420,900
0.000% 02/01/2007................ 585,000 375,131
0.000% 02/01/2008................ 610,000 362,950
0.000% 02/01/2011................ 500,000 240,000
OREGON HOUSING FINANCIAL
5.800% 07/01/2009................ 420,000 421,785
OREGON HEALTH, HOUSING, EDUCATIONAL
& CULTURAL FACILITIES AUTHORITY
GOODWILL INDUSTRIES LANE COUNTY
SERIES A
6.650% 11/15/2022................ 4,300,000 4,294,625
OREGON HEALTH, HOUSING, EDUCATIONAL
& CULTURAL FACILITIES AUTHORITY
REED COLLEGE PROJECT SERIES A
5.300% 07/01/2011................ 500,000 513,125
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
OREGON HOUSING & COMMUNITY SERVICES
DEPARTMENT HOUSING FINANCE
ASSISTED INSURED MULTI-UNIT B
6.800% 07/01/2013................ $8,270,000 $ 8,755,863
OREGON HOUSING & COMMUNITY SERVICES
DEPARTMENT MORTGAGE SINGLE-FAMILY
MORTGAGE
PG-SERIES A
4.850% 07/01/2010................ 310,000 312,713
5.100% 07/01/2014................ 430,000 432,150
6.800% 07/01/2016................ 2,005,000 2,145,350
OREGON HOUSING & COMMUNITY SERVICES
DEPARTMENT MORTGAGE SINGLE-FAMILY
MORTGAGE PROGRAM SERIES D
6.700% 07/01/2013................ 1,000,000 1,053,750
OREGON HOUSING & COMMUNITY SERVICES
DEPARTMENT MORTGAGE SINGLE-FAMILY
MORTGAGE PROGRAM SERIES E
6.750% 07/01/2016................ 2,660,000 2,660,000
PORT OF ST HELENS POLLUTION CONTROL
PORTLAND GENERAL ELECTRIC-B
4.800% 06/01/2010................ 2,000,000 1,995,000
PORT OF ST. HELENS POLLUTION
CONTROL PORTLAND GENERAL ELECTRIC
CO.
4.800% 04/01/2010................ 2,300,000 2,294,250
PORTLAND HYDROELECTRIC POWER
6.800% 10/01/2004................ 465,000 467,999
PORTLAND PARKING REFUNDING
6.375% 10/01/2012................ 1,700,000 1,770,125
PORTLAND WATER SYSTEM
5.250% 08/01/2013................ 2,000,000 2,047,500
5.000% 08/01/2017................ 3,685,000 3,694,213
PRINEVILLE SEWER FIRST LIEN
6.500% 07/01/2004................ 500,000 538,125
6.800% 07/01/2012................ 1,050,000 1,166,813
REEDSPORT WATER
7.000% 10/01/2014................ 520,000 588,250
SHERIDAN WATER REFUNDING
5.350% 04/01/2018................ 300,000 301,125
</TABLE>
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<TABLE>
<CAPTION>
OREGON REVENUE BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
SOUTH FORK WATER BOARD FIRST LIEN
5.450% 02/01/2014................ $1,300,000 $ 1,327,625
-------------
TOTAL OREGON REVENUE BONDS
(COST $61,358,100)................ 64,163,852
-------------
OREGON INSURED BONDS (40.2%)
CENTRAL OREGON COMMUNITY COLLEGE
DISTRICT
5.800% 06/01/2007................ 760,000 811,300
CHEMEKETA COMMUNITY COLLEGE
DISTRICT SERIES B
5.600% 06/01/2014................ 1,180,000 1,256,700
CLACKAMAS & WASHINGTON COUNTIES
SCHOOL DISTRICT #3JT
5.750% 06/01/2010................ 590,000 651,212
CLACKAMAS COUNTY HEALTH FACILITY
AUTHORITY REVENUE REFUNDING
ADVENTIST HEALTH A
6.350% 03/01/2009................ 1,500,000 1,621,875
CLATSOP COUNTY ADMINISTRATIVE
SCHOOL DISTRICT #10
5.875% 07/01/2012................ 630,000 654,412
CROOK COUNTY SCHOOL DISTRICT
4.900% 02/01/2009................ 1,165,000 1,179,562
DESCHUTES & JEFFERSON COUNTIES
SCHOOL DISTRICT #2J REDMOND
REFUNDING
5.600% 06/01/2009................ 1,000,000 1,043,750
EMERALD PEOPLES UTILITIES DISTRICT
7.200% 11/01/2006................ 480,000 573,600
7.350% 11/01/2010................ 2,160,000 2,724,300
7.350% 11/01/2011................ 2,000,000 2,535,000
7.350% 11/01/2012................ 2,490,000 3,162,300
7.350% 11/01/2013................ 2,675,000 3,420,656
EUGENE ELECTRIC UTILITY REVENUE
REFUNDING
4.700% 08/01/2008................ 1,225,000 1,246,437
HOOD RIVER COUNTY SCHOOL DISTRICT
5.650% 06/01/2008................ 1,020,000 1,079,925
JOSEPHINE COUNTY SCHOOL DISTRICT #7
GRANTS PASS
5.700% 06/01/2013................ 2,000,000 2,122,500
KLAMATH COUNTY
5.100% 06/01/2008................ 1,015,000 1,068,287
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
5.150% 06/01/2009................ $ 700,000 $ 738,500
LANE COUNTY SCHOOL DISTRICT #1
PLEASANT HILL
5.350% 12/01/2012................ 650,000 674,375
5.450% 12/01/2013................ 725,000 754,000
LANE COUNTY SCHOOL DISTRICT #19
SPRINGFIELD REFUNDING
5.250% 10/15/2006................ 1,340,000 1,425,425
6.000% 10/15/2012................ 740,000 822,325
6.000% 10/15/2014................ 1,310,000 1,462,287
LANE COUNTY SCHOOL DISTRICT #52
BETHEL
6.250% 12/01/2007................ 580,000 656,850
6.400% 12/01/2009................ 750,000 849,375
LINCOLN COUNTY SCHOOL DISTRICT
6.000% 06/15/2006................ 900,000 1,001,250
6.000% 06/15/2007................ 1,855,000 2,079,919
6.000% 06/15/2008................ 1,150,000 1,296,625
6.000% 06/15/2009................ 2,465,000 2,766,962
5.600% 06/15/2010................ 3,480,000 3,767,100
5.250% 06/15/2012................ 3,815,000 3,948,525
MALHEUR COUNTY SCHOOL DISTRICT #26
NYSSA
5.750% 06/01/2015................ 1,910,000 2,017,437
MARION & LINN COUNTY ELEMENTARY
SCHOOL DISTRICT #77J STAYTON
6.250% 07/01/2013................ 1,260,000 1,395,450
MARION COUNTY SCHOOL DISTRICT #103C
WOODBURN SERIES B
0.000% 11/01/2006................ 2,000,000 1,387,500
0.000% 11/01/2007................ 2,000,000 1,322,500
0.000% 11/01/2009................ 2,500,000 1,503,125
0.000% 11/01/2011................ 2,010,000 1,085,400
MILWAUKIE, OR
4.650% 06/01/2009................ 405,000 409,556
4.750% 06/01/2010................ 425,000 432,437
4.850% 06/01/2011................ 340,000 344,250
MORROW COUNTY SCHOOL DISTRICT #1
6.000% 06/01/2006................ 880,000 976,800
MULTNOMAH COUNTY EDUCATIONAL
FACILITIES UNIVERSITY OF PORTLAND
PROJECT
5.000% 04/01/2018................ 1,500,000 1,494,375
</TABLE>
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<TABLE>
<CAPTION>
OREGON INSURED BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
MULTNOMAH COUNTY SCHOOL DISTRICT #3
PARKROSE
5.400% 12/01/2005................ $1,010,000 $ 1,069,337
5.700% 12/01/2008................ 1,330,000 1,428,087
5.700% 12/01/2009................ 1,970,000 2,100,513
5.500% 12/01/2010................ 895,000 938,631
5.500% 12/01/2011................ 1,000,000 1,047,500
NORTHERN OREGON CORRECTIONS
5.250% 09/15/2012................ 1,000,000 1,030,000
5.300% 09/15/2013................ 1,000,000 1,035,000
ONTARIO OREGON CATHOLIC HEALTH HOLY
ROSARY MEDICAL CENTER
5.500% 11/15/2012................ 1,500,000 1,586,250
OREGON DEPARTMENT OF ADMINISTRATIVE
SERVICES CERTIFICATES
PARTICIPATION SERIES A
5.375% 11/01/2004................ 1,500,000 1,590,000
5.250% 05/01/2008................ 4,950,000 5,209,875
5.300% 05/01/2008................ 750,000 795,938
5.250% 11/01/2009................ 2,460,000 2,573,775
5.700% 05/01/2015................ 1,000,000 1,063,750
5.375% 11/01/2016................ 4,695,000 4,824,113
OREGON DEPARTMENT OF ADMINISTRATIVE
SERVICES CERTIFICATES
PARTICIPATION SERIES B
5.500% 11/01/2011................ 1,635,000 1,731,056
5.000% 11/01/2013................ 1,000,000 1,015,000
5.000% 11/01/2014................ 500,000 505,625
OREGON DEPARTMENT OF ADMINISTRATIVE
SERVICES CERTIFICATES
PARTICIPATION SERIES C
5.500% 05/01/2011................ 2,000,000 2,112,500
5.750% 05/01/2017................ 2,000,000 2,125,000
OREGON DEPARTMENT OF GENERAL
SERVICES CERTIFICATES
PARTICIPATION SERIES C
5.800% 03/01/2015................ 840,000 875,700
OREGON HEALTH SCIENCES UNIVERSITY
REVENUE SERIES A
0.000% 07/01/2009................ 1,530,000 918,000
0.000% 07/01/2012................ 1,315,000 670,650
0.000% 07/01/2014................ 2,495,000 1,138,344
0.000% 07/01/2015................ 4,325,000 1,865,156
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
OREGON HEALTH SCIENCES UNIVERSITY
REVENUE SERIES B
4.875% 07/01/2007................ $1,695,000 $ 1,737,375
OREGON HEALTH, HOUSING, EDUCATIONAL
& CULTURAL FACILITIES AUTHORITY
LEWIS & CLARK COLLEGE
6.000% 10/01/2013................ 965,000 1,054,263
PORT OF PORTLAND AIRPORT REVENUE
PORTLAND INTERNATIONAL AIRPORT
SERIES 7-A
6.500% 07/01/2004................ 500,000 535,625
6.750% 07/01/2015................ 3,470,000 3,751,938
PORT OF PORTLAND AIRPORT REVENUE
SERIES 9-A
5.500% 07/01/2006................ 500,000 523,750
PORTLAND ARENA GAS TAX REVENUE
0.000% 06/01/2016................ 1,100,000 398,750
0.000% 06/01/2017................ 1,420,000 481,025
PORTLAND COMMUNITY COLLEGE DISTRICT
5.000% 07/01/2011................ 2,000,000 2,047,500
PORTLAND GAS TAX REVENUE SERIES A
5.800% 06/01/2016................ 1,625,000 1,726,563
PORTLAND SEWER SYSTEM REVENUE
SERIES A
5.000% 06/01/2009................ 1,075,000 1,112,625
5.000% 06/01/2015................ 5,500,000 5,527,500
SALEM-KEIZER SCHOOL DISTRICT #24J
5.400% 06/01/2006................ 1,000,000 1,052,500
SALEM PEDESTRIAN SAFETY
IMPROVEMENTS
5.400% 05/01/2009................ 1,000,000 1,050,000
SALEM WATER & SEWER
6.000% 06/01/2005................ 1,080,000 1,186,650
TILLAMOOK COUNTY
6.250% 01/01/2014................ 960,000 1,058,400
5.700% 01/15/2016................ 700,000 741,125
TUALATIN VALLEY WATER DISTRICT
5.000% 06/01/2018................ 2,045,000 2,042,444
UMATILLA COUNTY SCHOOL DISTRICT #6R
UMATILLA
5.080% 06/15/2018................ 1,455,000 1,442,269
</TABLE>
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<TABLE>
<CAPTION>
OREGON INSURED BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
UMATILLA COUNTY SCHOOL DISTRICT #8R
HERMISTON
4.400% 12/01/2011................ $1,000,000 $ 968,750
UMATILLA COUNTY SCHOOL DISTRICT
#16R PENDLETON
4.650% 07/01/2010................ 1,660,000 1,660,000
WASHINGTON COUNTY SCHOOL DISTRICT
#13
5.350% 06/01/2011................ 355,000 371,863
5.350% 06/01/2012................ 440,000 457,600
5.400% 06/01/2013................ 485,000 504,400
WASHINGTON COUNTY SCHOOL DISTRICT
#15
5.250% 06/01/2009................ 1,000,000 1,058,750
WASHINGTON COUNTY SCHOOL DISTRICT
#48J BEAVERTON SERIES A
5.200% 12/01/2009................ 1,740,000 1,813,950
WASHINGTON COUNTY SCHOOL DISTRICT
#88J SHERWOOD
6.100% 06/01/2012................ 1,000,000 1,090,000
WASHINGTON COUNTY UNIFIED SEWER
AGENCY REVENUE
5.500% 10/01/2016................ 1,500,000 1,571,250
WASHINGTON COUNTY UNIFIED SEWER
AGENCY REVENUE SERIES A
0.000% 10/01/2003................ 1,975,000 1,582,469
0.000% 10/01/2005................ 5,230,000 3,811,363
0.000% 10/01/2007................ 4,835,000 3,197,144
5.750% 10/01/2009................ 3,350,000 3,722,688
5.750% 10/01/2010................ 2,000,000 2,222,500
5.750% 10/01/2011................ 1,825,000 2,025,750
5.400% 10/01/2012................ 520,000 545,350
5.750% 10/01/2012................ 2,000,000 2,232,500
WASHINGTON COUNTY UNIFIED SEWER
AGENCY UNREFUNDED SERIES A
5.900% 10/01/2006................ 1,050,000 1,136,625
WESTERN LANE HOSPITAL DISTRICT
FACILITY AUTHORITY REVENUE
REFUNDING SISTERS ST. JOSEPH PEACE
5.625% 08/01/2007................ 2,080,000 2,230,800
YAMHILL COUNTY SCHOOL DISTRICT #29J
NEWBERG
5.500% 06/01/2010................ 1,405,000 1,499,838
5.750% 06/01/2011................ 2,280,000 2,508,000
6.100% 06/01/2011................ 3,355,000 3,711,469
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
YAMHILL COUNTY SCHOOL DISTRICT #40
6.000% 06/01/2009................ $ 500,000 $ 561,250
5.350% 06/01/2010................ 500,000 529,375
5.600% 06/01/2016................ 500,000 524,375
-------------
TOTAL OREGON INSURED BONDS
(COST $160,229,855)............... 168,022,325
-------------
OREGON PRE-REFUNDED BONDS (5.6%)
CHEMEKETA COMMUNITY COLLEGE
DISTRICT
5.950% 06/01/2016................ 1,600,000 1,780,000
CLACKAMAS & WASHINGTON COUNTIES
SCHOOL DISTRICT #3JT WEST
LINN-WILSONVILLE
5.875% 08/01/2009................ 1,000,000 1,068,750
CLACKAMAS COUNTY HOSPITAL FACILITY
AUTHORITY ELDERLY HOUSING
WILLAMETTE VIEW INCOME PROJECT
7.000% 11/15/2011................ 470,000 522,287
CLACKAMAS COUNTY SCHOOL DISTRICT #1
6.250% 07/01/2002................ 925,000 982,813
6.300% 07/01/2003................ 700,000 744,625
CLACKAMAS COUNTY SCHOOL DISTRICT
#115 GLADSTONE
6.150% 06/01/2014................ 1,200,000 1,344,000
DESCHUTES COUNTY ADMINISTRATIVE
SCHOOL DISTRICT #1 BEND-LAPINE
5.800% 02/01/2004................ 780,000 819,975
5.900% 02/01/2005................ 980,000 1,033,900
EUGENE ELECTRIC UTILITY SERIES C
5.750% 08/01/2011................ 715,000 779,350
5.750% 08/01/2016................ 1,055,000 1,149,950
LANE COUNTY SCHOOL DISTRICT #19
SPRINGFIELD
6.150% 10/15/2009................ 1,500,000 1,676,250
MEDFORD HOSPITAL FACILITY AUTHORITY
REVENUE GROSS-ROGUE VALLEY HEALTH
SERVICES
6.800% 12/01/2011................ 1,820,000 1,972,425
MULTNOMAH COUNTY EDUCATIONAL
FACILITIES UNIVERSITY OF PORTLAND
PROJECT
6.000% 04/01/2014................ 1,375,000 1,510,781
</TABLE>
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<TABLE>
<CAPTION>
OREGON PRE-REFUNDED BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
OREGON CITY SEWER
6.500% 10/01/2007................ $ 500,000 $ 556,250
OREGON HOUSING, EDUCATIONAL &
CULTURAL FACILITIES AUTHORITY REED
COLLEGE PROJECT SERIES A
6.350% 07/01/2002................ 320,000 346,800
6.400% 07/01/2003................ 280,000 303,800
PORTLAND SEWER SYSTEM REVENUE
SERIES A
6.050% 06/01/2009................ 535,000 590,506
6.200% 06/01/2012................ 4,000,000 4,445,000
UMATILLA COUNTY SCHOOL DISTRICT #8R
HERMISTON
6.000% 12/01/2010................ 695,000 766,238
UNION HEALTH DISTRICT
5.750% 02/01/2010................ 1,070,000 1,131,525
-------------
TOTAL OREGON PRE-REFUNDED BONDS
(COST $21,492,568)................ 23,525,225
-------------
OREGON OTHER BONDS (2.9%)
GRANTS PASS URBAN RENEWAL AGENCY
TAX INCREMENT
6.125% 08/01/2012................ 755,000 779,537
HOOD RIVER URBAN RENEWAL AGENCY
REVENUE
6.250% 12/15/2011................ 1,250,000 1,365,625
LANE COUNTY SCHOOL DISTRICT #4J
EUGENE CERTIFICATES PARTICIPATION
6.900% 10/01/2000................ 500,000 531,250
LEBANON SPECIAL OBLIGATION REVENUE
REFUNDING LEASE WATER
5.400% 10/01/2013................ 755,000 773,875
MEDFORD URBAN RENEWAL AGENCY TAX
REVENUE
5.875% 09/01/2010................ 500,000 529,375
NEWBERG CERTIFICATES PARTICIPATION
5.900% 12/01/1998................ 365,000 367,639
6.000% 12/01/1999................ 390,000 399,750
6.100% 12/01/2000................ 410,000 426,913
6.200% 12/01/2001................ 410,000 433,575
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
PORTLAND AIRPORT WAY URBAN RENEWAL
& REDEVELOPMENT TAX INCREMENT
SERIES C
5.900% 06/01/2006................ $ 860,000 $ 919,125
PORTLAND BUILDING REFUNDING SERIES
A
4.750% 04/01/2007................ 2,000,000 2,027,500
PORTLAND URBAN RENEWAL &
REDEVELOPMENT REFUNDING, DOWNTOWN
WATERFRONT SERIES L
6.000% 06/01/2002................ 1,140,000 1,218,375
6.400% 06/01/2008................ 2,085,000 2,243,981
-------------
TOTAL OREGON OTHER BONDS
(COST $11,323,155)................ 12,016,520
-------------
OTHER BONDS (7.8%)
PUERTO RICO COMMONWEALTH
6.250% 07/01/2008................ 1,000,000 1,145,000
5.000% 07/01/2018................ 1,500,000 1,483,125
PUERTO RICO COMMONWEALTH AQUEDUCT &
SEWER AUTHORITY
5.200% 07/01/2008................ 1,000,000 1,063,750
PUERTO RICO COMMONWEALTH AQUEDUCT &
SEWER AUTHORITY REVENUE SERIES A
9.000% 07/01/2009................ 6,085,000 7,659,494
PUERTO RICO COMMONWEALTH
INFRASTRUCTURE FINANCING AUTHORITY
5.000% 07/01/2013................ 1,750,000 1,776,250
PUERTO RICO COMMONWEALTH PUBLIC
BUILDINGS AUTHORITY REVENUE SERIES
B
5.000% 07/01/2013................ 3,130,000 3,184,775
5.000% 07/01/2027................ 1,500,000 1,473,750
PUERTO RICO COMMONWEALTH PUBLIC
IMPROVEMENTS
6.250% 07/01/2009................ 3,000,000 3,457,500
6.250% 07/01/2013................ 1,000,000 1,156,250
PUERTO RICO ELECTRIC POWER
AUTHORITY
5.000% 07/01/2010................ 2,425,000 2,497,750
PUERTO RICO HOUSING BANK & FINANCE
AGENCY SINGLE FAMILY MORTGAGE
REVENUE FHA HOMEOWNERSHIP 5TH
PORTFOLIO
7.500% 12/01/2015................ 610,000 649,650
</TABLE>
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<TABLE>
<CAPTION>
OTHER BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
PUERTO RICO HOUSING FINANCE CORP.
MULTI FAMILY MORTGAGE REVENUE
PORTFOLIO A-1
7.500% 04/01/2022................ $1,425,000 $ 1,492,688
PUERTO RICO HOUSING FINANCE CORP.
SINGLE FAMILY MORTGAGE REVENUE
PORTFOLIO 1 SERIES B
7.500% 10/15/2012................ 1,040,000 1,097,200
PUERTO RICO HOUSING FINANCE CORP.
SINGLE FAMILY MORTGAGE REVENUE
PORTFOLIO 1 SERIES C
6.750% 10/15/2013................ 710,000 755,262
PUERTO RICO INDUSTRIAL, MEDICAL &
ENVIRONMENTAL POLLUTION CONTROL
FACILITIES FINANCING AUTHORITY
REVENUE FHA INSURED MORTGAGE DR.
PILA HOSPITAL PROJECT -A
7.700% 08/01/2008................ 1,895,000 1,937,031
VIRGIN ISLANDS PUBLIC FINANCE
AUTHORITY REVENUE UNREFUNDED
BALANCE SERIES A
7.300% 10/01/2018................ 1,185,000 1,493,100
-------------
TOTAL OTHER BONDS
(COST $30,738,739)................ 32,322,575
-------------
TOTAL INVESTMENTS, EXCLUDING
TEMPORARY CASH INVESTMENT
(COST $391,031,923)............... 411,722,617
-------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- -------------
<S> <C> <C>
TAX-EXEMPT MONEY MARKET INVESTMENT (0.9%)
SEI TAX EXEMPT TRUST (COST
$3,743,725)..................... $3,743,725 $ 3,743,725
-------------
TOTAL INVESTMENTS (99.5%)
(COST $394,775,648)................... 415,466,342
RECEIVABLES LESS LIABILITIES (0.5%).... 2,116,146
-------------
NET ASSETS (100.0%).................... $ 417,582,488
-------------
-------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
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<TABLE>
<CAPTION>
JUNE 30, 1998 PRINCIPAL
(UNAUDITED) AMOUNT VALUE(1)
----------- ------------
<S> <C> <C>
CORPORATE BONDS (93.8%)
INDUSTRIAL (79.8%)
BASIC INDUSTRY & MANUFACTURING (16.6%)
MANUFACTURING (15.0%)
AVIATION SALES CO. (144A)
SENIOR SUBORDINATED NOTES
8.125% 02/15/2008.............. $1,000,000 $ 975,000
FEDERAL MOGUL CORP.
NOTES
7.750% 07/01/2006.............. 500,000 499,375
HAYES WHEELS INTERNATIONAL, INC.
SERIES B
SENIOR SUBORDINATED NOTES
9.125% 07/15/2007.............. 1,000,000 1,045,000
SILGAN HOLDINGS, INC.
SENIOR SUBORDINATED DEBENTURES
9.000% 06/01/2009.............. 1,000,000 1,035,000
TITAN WHEEL INTERNATIONAL, INC.
SENIOR SUBORDINATED NOTES
8.750% 04/01/2007.............. 900,000 927,000
TRACOR, INC.
SENIOR SUBORDINATED NOTES
8.500% 03/01/2007.............. 1,000,000 1,082,500
UNISYS CORP.
SENIOR NOTES
7.875% 04/01/2008.............. 1,000,000 1,020,000
WYMAN-GORDON CO.
SENIOR NOTES
8.000% 12/15/2007.............. 990,000 1,004,850
------------
7,588,725
------------
METALS/MINING (1.6%)
RYERSON TULL, INC.
NOTES
8.500% 07/15/2001.............. 750,000 779,063
------------
TOTAL BASIC INDUSTRY &
MANUFACTURING..................... 8,367,788
------------
BUSINESS & CONSUMER SERVICES (6.1%)
IRON MOUNTAIN, INC.
SENIOR SUBORDINATED NOTES
10.125% 10/01/2006............... 750,000 813,750
PIERCE LEAHY CORP.
SENIOR SUBORDINATED NOTES
11.125% 07/15/2006............... 900,000 1,008,000
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- ------------
<S> <C> <C>
RENTAL SERVICE CORP. (144A)
SENIOR SUBORDINATED NOTES
9.000% 05/15/2008................ $ 750,000 $ 750,000
UNITED STATIONERS SUPPLY CO. (144A)
SENIOR SUBORDINATED NOTES
8.375% 04/15/2008................ 485,000 486,213
------------
TOTAL BUSINESS & CONSUMER
SERVICES.......................... 3,057,963
------------
CONSUMER CYCLICAL (11.1%)
HOTELS & GAMING (3.7%)
HMH PROPERTIES, INC. SERIES B
SENIOR SECURED NOTES
9.500% 05/15/2005.............. 600,000 652,500
RIO HOTEL & CASINO, INC.
SENIOR SUBORDINATED NOTES
9.500% 04/15/2007.............. 450,000 477,000
STATION CASINOS, INC.
SENIOR SUBORDINATED NOTES
9.625% 06/01/2003.............. 740,000 765,900
------------
1,895,400
------------
HOUSING RELATED (2.0%)
WEBB (DEL E.) CORP.
SENIOR SUBORDINATED DEBENTURES
9.000% 02/15/2006.............. 1,000,000 995,000
------------
RETAIL (5.4%)
MAXIM GROUP, INC. SERIES B
SENIOR SUBORDINATED NOTES
9.250% 10/15/2007.............. 900,000 924,750
SPECIALTY RETAILERS, INC. SERIES
B
SENIOR NOTES
8.500% 07/15/2005.............. 1,000,000 1,025,000
ZALE CORP. SERIES B
SENIOR NOTES
8.500% 10/01/2007.............. 750,000 772,500
------------
2,722,250
------------
TOTAL CONSUMER CYCLICAL............ 5,612,650
------------
CONSUMER STAPLES (11.9%)
FOOD/BEVERAGE/TOBACCO (1.9%)
AURORA FOODS, INC. SERIES E
(144A)
SENIOR SUBORDINATED NOTES
8.750% 07/01/2008.............. 500,000 506,875
</TABLE>
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<TABLE>
<CAPTION>
CORPORATE BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- ------------
<S> <C> <C>
PURINA MILLS, INC. (144A)
SENIOR SUBORDINATED NOTES
9.000% 03/15/2010.............. $ 450,000 $ 462,375
------------
969,250
------------
HEALTH CARE (8.0%)
ABBEY HEALTHCARE GROUP, INC.
SENIOR SUBORDINATED NOTES
9.500% 11/01/2002.............. 500,000 495,000
CONMED CORP.
SENIOR SUBORDINATED NOTES
9.000% 03/15/2008.............. 750,000 744,375
HEALTHSOUTH CORP.
SENIOR SUBORDINATED NOTES
9.500% 04/01/2001.............. 500,000 518,750
QUORUM HEALTH GROUP, INC.
SENIOR SUBORDINATED NOTES
8.750% 11/01/2005.............. 1,000,000 1,035,000
TENET HEALTHCARE CORP. (144A)
SENIOR SUBORDINATED NOTES
8.125% 12/01/2008.............. 1,250,000 1,253,125
------------
4,046,250
------------
OTHER (2.0%)
WESTPOINT STEVENS, INC. (144A)
SENIOR NOTES
7.875% 06/15/2005.............. 1,000,000 1,007,500
------------
TOTAL CONSUMER STAPLES............. 6,023,000
------------
ENERGY (6.8%)
GULF CANADA RESOURCES LTD.
SENIOR SUBORDINATED DEBENTURES
9.625% 07/01/2005............... 750,000 817,500
KELLEY OIL & GAS CORP. SERIES B
SENIOR SUBORDINATED NOTES
10.375% 10/15/2006............... 600,000 597,000
NUEVO ENERGY CO.
SENIOR SUBORDINATED NOTES
9.500% 04/15/2006............... 900,000 940,500
SANTA FE ENERGY RESOURCE, INC.
SENIOR SUBORDINATED DEBENTURES
11.000% 05/15/2004............... 1,000,000 1,075,000
------------
TOTAL ENERGY....................... 3,430,000
------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- ------------
<S> <C> <C>
ENTERTAINMENT & MEDIA (24.6%)
ADELPHIA COMMUNICATIONS CORP.
SERIES B
SENIOR NOTES
10.500% 07/15/2004............... $1,000,000 $ 1,092,500
CINEMARK USA, INC. SERIES B
SENIOR SUBORDINATED NOTES
9.625% 08/01/2008................ 1,000,000 1,030,000
COMCAST CORP.
SENIOR SUBORDINATED DEBENTURES
9.500% 01/15/2008................ 1,000,000 1,067,840
HERITAGE MEDIA CORP.
SENIOR SUBORDINATED NOTES
8.750% 02/15/2006................ 750,000 798,750
HOLLINGER INTERNATIONAL PUBLISHING,
INC.
SENIOR NOTES
8.625% 03/15/2005................ 1,000,000 1,045,000
JACOR COMMUNICATIONS CO. SERIES B
SENIOR SUBORDINATED NOTES
8.750% 06/15/2007................ 1,000,000 1,040,000
JONES INTERCABLE, INC.
SENIOR NOTES
8.875% 04/01/2007................ 700,000 749,000
7.625% 04/15/2008................ 300,000 304,500
LAMAR ADVERTISING CO.
SENIOR SUBORDINATED NOTES
9.625% 12/01/2006................ 1,000,000 1,072,500
LENFEST COMMUNICATIONS, INC.
SENIOR NOTES
8.375% 11/01/2005................ 750,000 796,875
OUTDOOR SYSTEMS, INC.
SENIOR SUBORDINATED NOTES
9.375% 10/15/2006................ 985,000 1,046,562
SFX BROADCASTING, INC. SERIES B
SENIOR SUBORDINATED NOTES
10.750% 05/15/2006............... 750,000 826,875
SINCLAIR BROADCAST GROUP, INC.
SENIOR SUBORDINATED NOTES
8.750% 12/15/2007................ 750,000 768,750
YOUNG BROADCASTING, INC. SERIES B
SENIOR SUBORDINATED NOTES
10.125% 02/15/2005............... 750,000 813,750
------------
TOTAL ENTERTAINMENT & MEDIA........ 12,452,902
------------
</TABLE>
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<TABLE>
<CAPTION>
CORPORATE BONDS (CONTINUED)
PRINCIPAL
AMOUNT VALUE(1)
----------- ------------
<S> <C> <C>
TRANSPORTATION (2.7%)
OTHER (2.7%)
ALLIED HOLDING, INC. SERIES B
SENIOR NOTES
8.625% 10/01/2007.............. $ 500,000 $ 502,500
TEEKAY SHIPPING CORP. GTD. 1ST
PFD. SHIP. MTG. NOTES
8.320% 02/01/2008.............. 850,000 879,750
------------
TOTAL TRANSPORTATION............... 1,382,250
------------
TOTAL INDUSTRIAL................... 40,326,553
------------
UTILITIES (12.3%)
ELECTRIC (6.4%)
AES CORP.
SENIOR SUBORDINATED NOTES
10.250% 07/15/2006............... 800,000 868,000
AES CORP.
SENIOR SUBORDINATED EXCHANGE NOTES
8.375% 08/15/2007............... 500,000 505,000
CALENERGY, INC.
SENIOR SECURED NOTES
9.875% 06/30/2003............... 850,000 909,508
CMS ENERGY CORP. (144A)
SENIOR UNSECURED NOTES
7.000% 01/15/2005............... 1,000,000 976,260
------------
3,258,768
------------
TELECOMMUNICATIONS (5.9%)
FLAG LTD. (144A)
SENIOR NOTES
8.250% 01/30/2008............... 750,000 755,625
LEVEL 3 COMMUNICATIONS, INC. (144A)
SENIOR NOTES
9.125% 05/01/2008............... 740,000 719,650
NEXTLINK COMMUNICATIONS, INC.
(144A)
SENIOR DISCOUNT NOTES
0.000% 04/15/2008............... 1,000,000 615,000
PAGING NETWORK, INC.
SENIOR SUBORDINATED NOTES
10.000% 10/15/2008............... 850,000 877,625
------------
2,967,900
------------
TOTAL UTILITIES.................... 6,226,668
------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE(1)
----------- ------------
<S> <C> <C>
YANKEE (1.7%)
SOVEREIGN-OTHER (1.7%)
MEXICO-UNITED MEXICAN STATES
GLOBAL BONDS
11.375% 09/15/2016.......... $ 750,000 $ 838,125
------------
TOTAL CORPORATE BONDS
(COST $46,495,770)................ 47,391,346
------------
REPURCHASE AGREEMENTS (5.5%)
GOLDMAN SACHS CORP.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $2,658,184.
COLLATERALIZED BY
U.S. TREASURY BONDS
6.250% DUE 08/15/2023............... 2,657,759 2,657,759
J.P. MORGAN SECURITIES, INC.
5.830% DATED 06/30/1998,
DUE 07/01/1998 IN THE
AMOUNT OF $100,016.
COLLATERALIZED BY
U.S. TREASURY NOTES
5.625% TO 6.750%
DUE 04/30/2000 TO 12/31/2002........ 100,000 100,000
------------
TOTAL REPURCHASE AGREEMENTS
(COST $2,757,759)................. 2,757,759
------------
TOTAL INVESTMENTS (99.3%)
(COST $49,253,529).................... 50,149,105
RECEIVABLES LESS LIABILITIES (0.7%).... 364,536
------------
NET ASSETS (100.0%).................... $ 50,513,641
------------
------------
</TABLE>
(1) See Note 1 of Notes to Financial Statements.
The accompanying notes are an integral part
of the financial statements.
65
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<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
June 30, 1998 COMMON STOCK GROWTH INTERNATIONAL STOCK SPECIAL
(Unaudited) FUND, INC. FUND, INC. FUND, INC. FUND, INC.
------------- --------------- ------------------- ---------------
<S> <C> <C> <C> <C>
ASSETS:
Investments at identified cost.................. $703,693,351 $ 1,141,868,701 $109,916,996 $ 879,792,156
- -------------------------------------------------- ------------- --------------- ------------------- ---------------
Investments at value (Notes 1 and 2)............ $892,851,539 $ 1,644,039,384 $146,257,439 $ 1,015,087,183
Temporary cash investments, at cost (Note 1).... 36,203,710 35,174,019 6,607,564 96,534,452
Cash............................................ 42,051
Cash denominated in foreign currencies (cost
$116,581) (Note 1)............................. 113,622
Receivable for:
Interest...................................... 114,434 110,978 29,175 648,205
Dividends..................................... 583,556 836,784 275,001 399,100
Investments sold.............................. 5,567,959 21,160,876
Capital stock sold............................ 469,370 878,300 129,583 1,685,752
------------- --------------- ------------------- ---------------
Total assets.................................... 935,790,568 1,702,200,341 153,454,435 1,114,354,692
------------- --------------- ------------------- ---------------
LIABILITIES:
Payable for:
Capital stock redeemed........................ 618,482 584,385 160,082 1,582,362
Dividends and distributions................... 13,096
Investments purchased......................... 13,421,332 10,364,027 14,187,779
Investment management fee (Note 4)............ 440,125 732,391 124,895 767,973
Accrued expenses.............................. 38,108 161,597 75,417 293,265
------------- --------------- ------------------- ---------------
Total liabilities............................... 14,531,143 11,842,400 360,394 16,831,379
------------- --------------- ------------------- ---------------
NET ASSETS APPLICABLE TO OUTSTANDING SHARES....... $921,259,425 $ 1,690,357,941 $153,094,041 $ 1,097,523,313
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
Net assets consist of:
Undistributed net investment income............. $ 1,855,343 $ 4,201,503 $ 316,618 $ 712,433
Unrealized appreciation (depreciation) on:
Investments................................... 189,158,188 502,170,683 36,340,443 135,295,027
Translation of assets and liabilities in
foreign currencies........................... (3,403)
Undistributed net realized gain (loss) from:
Investments................................... 74,071,710 93,741,519 (2,695,862) 100,474,966
Foreign currency transactions................. (765,989)
Capital shares (Note 3)......................... 404,960 498,720
Capital paid in (Note 3)........................ 656,174,184 1,089,839,276 119,902,234 860,542,167
------------- --------------- ------------------- ---------------
$921,259,425 $ 1,690,357,941 $153,094,041 $ 1,097,523,313
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
SHARES OF CAPITAL STOCK OUTSTANDING (NOTE 3)...... 36,284,129 40,496,046 9,882,610 49,871,957
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE
PER SHARE (1).................................. $ 25.39 $ 41.74 $ 15.49 $ 22.01
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
</TABLE>
(1) The net asset value per share is computed by dividing net assets applicable
to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
66
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA
COLUMBIA REAL ESTATE COLUMBIA COLUMBIA
June 30, 1998 SMALL CAP EQUITY BALANCED DAILY INCOME
(Unaudited) FUND, INC. FUND, INC. FUND, INC. COMPANY
------------- ------------- ------------- ---------------
<S> <C> <C> <C> <C>
ASSETS:
Investments at identified cost.................. $ 110,018,637 $143,493,863 $ 787,729,778 $ 1,033,953,887
- -------------------------------------------------- ------------- ------------- ------------- ---------------
Investments at value (Notes 1 and 2)............ $ 125,723,561 $160,179,340 $ 919,367,988 $ 1,033,953,887
Temporary cash investments, at cost (Note 1).... 13,839,162 9,955,170 22,892,921
Cash............................................ 300,000
Receivable for:
Interest...................................... 61,144 40,248 5,527,848 10,579
Dividends..................................... 14,245 898,934 314,546
Investments sold.............................. 2,822,041 4,195,141
Capital stock sold............................ 367,683 515,513 290,590 1,500,184
------------- ------------- ------------- ---------------
Total assets.................................... 142,827,836 171,589,205 952,589,034 1,035,764,650
------------- ------------- ------------- ---------------
LIABILITIES:
Payable for:
Capital stock redeemed........................ 341,588 174,043 5,200,606 8,679,341
Dividends and distributions................... 197,986 107,687
Investments purchased......................... 3,600,069 4,936,432
Investment management fee (Note 4)............ 109,449 102,363 380,890 402,836
Accrued expenses.............................. 26,893 2,776 133,032 307,221
------------- ------------- ------------- ---------------
Total liabilities............................... 4,077,999 477,168 10,758,647 9,389,398
------------- ------------- ------------- ---------------
NET ASSETS APPLICABLE TO OUTSTANDING SHARES....... $ 138,749,837 $171,112,037 $ 941,830,387 $ 1,026,375,252
------------- ------------- ------------- ---------------
------------- ------------- ------------- ---------------
Net assets consist of:
Undistributed net investment income (loss)...... $ (418,162) $ 24,098 $ 1,171,463
Unrealized appreciation on investments.......... 15,704,924 16,685,477 131,638,210
Undistributed net realized gain (loss) from
investments.................................... 3,225,275 (51,620) 46,234,624
Capital shares (Note 3)......................... $ 1,026,375
Capital paid in (Note 3)........................ 120,237,800 154,454,082 762,786,090 1,025,348,877
------------- ------------- ------------- ---------------
$ 138,749,837 $171,112,037 $ 941,830,387 $ 1,026,375,252
------------- ------------- ------------- ---------------
------------- ------------- ------------- ---------------
SHARES OF CAPITAL STOCK OUTSTANDING (NOTE 3)...... 7,654,930 9,691,686 39,988,071 1,026,375,252
------------- ------------- ------------- ---------------
------------- ------------- ------------- ---------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER
SHARE (1)........................................ $ 18.13 $ 17.66 $ 23.55 $ 1.00
------------- ------------- ------------- ---------------
------------- ------------- ------------- ---------------
</TABLE>
(1) The net asset value per share is computed by dividing net assets applicable
to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
67
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA U.S. COLUMBIA FIXED
GOVERNMENT INCOME COLUMBIA COLUMBIA
June 30, 1998 SECURITIES SECURITIES MUNICIPAL BOND HIGH YIELD
(Unaudited) FUND, INC. FUND, INC. FUND, INC. FUND, INC.
------------- --------------- ------------------- ---------------
<S> <C> <C> <C> <C>
ASSETS:
Investments at identified cost.................. $ 38,607,933 $ 391,858,220 $391,031,923 $ 46,495,770
- -------------------------------------------------- ------------- --------------- ------------------- ---------------
Investments at value (Notes 1 and 2)............ $ 38,667,664 $ 401,433,704 $411,722,617 $ 47,391,346
Temporary cash investments, at cost (Note 1).... 563,270 22,473,724 3,743,725 2,757,759
Receivable for:
Interest...................................... 511,150 4,784,891 5,150,346 1,065,648
Investments sold.............................. 627,859 4,799,760
Capital stock sold............................ 582 467,862 3,886 10,995
------------- --------------- ------------------- ---------------
Total assets.................................... 39,742,666 429,788,040 425,420,334 51,225,748
------------- --------------- ------------------- ---------------
LIABILITIES:
Payable for:
Capital stock redeemed........................ 580,092 5,907,520 155,501 134,440
Dividends and distributions................... 9,929 446,816 336,855 27,996
Investments purchased......................... 11,663,175 7,150,498 500,000
Investment management fee (Note 4)............ 16,185 170,402 172,393 24,728
Accrued expenses.............................. 13,524 63,885 22,599 24,943
------------- --------------- ------------------- ---------------
Total liabilities............................... 619,730 18,251,798 7,837,846 712,107
------------- --------------- ------------------- ---------------
NET ASSETS APPLICABLE TO OUTSTANDING SHARES....... $ 39,122,936 $ 411,536,242 $417,582,488 $ 50,513,641
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
Net assets consist of:
Unrealized appreciation on investments........ $ 59,731 $ 9,575,484 $ 20,690,694 $ 895,576
Undistributed net realized gain (loss) from
investments.................................. (137,691) 2,069,340 3,008,009 478,663
Capital shares (Note 3)....................... 47,075 305,253 335,559
Capital paid in (Note 3)...................... 39,153,821 399,586,165 393,548,226 49,139,402
------------- --------------- ------------------- ---------------
$ 39,122,936 $ 411,536,242 $417,582,488 $ 50,513,641
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
SHARES OF CAPITAL STOCK OUTSTANDING (NOTE 3)...... 4,707,459 30,525,323 33,555,914 5,002,709
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER
SHARE (1)........................................ $ 8.31 $ 13.48 $ 12.44 $ 10.10
------------- --------------- ------------------- ---------------
------------- --------------- ------------------- ---------------
</TABLE>
(1) The net asset value per share is computed by dividing net assets applicable
to outstanding shares by shares of capital stock outstanding.
The accompanying notes are an integral part of the financial statements.
68
<PAGE>
STATEMENTS OF OPERATIONS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
Six Months Ended June 30, 1998 COMMON STOCK GROWTH INTERNATIONAL STOCK SPECIAL
(Unaudited) FUND, INC. FUND, INC. FUND, INC. FUND, INC.
------------- ------------- ------------------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Income:
Interest................................. $ 1,269,993 $ 573,425 $ 271,350 $ 3,419,259
Dividends................................ 5,264,154 6,639,133 1,331,313 2,835,083
Foreign taxes withheld (net of
reclaims)............................... (163,471)
------------- ------------- ------------------- -------------
Total income........................... 6,534,147 7,212,558 1,439,192 6,254,342
------------- ------------- ------------------- -------------
Expenses:
Investment management fees (Note 4)...... 2,612,332 4,205,452 745,167 4,985,736
Shareholder servicing costs (Note 4)..... 533,242 589,894 210,343 664,367
Reports to shareholders.................. 55,477 100,012 40,111 134,365
Accounting expense....................... 17,861 15,322 36,533 26,012
Financial information and
subscriptions........................... 4,677 7,211 5,950 10,198
Custodian fees........................... 13,659 20,806 37,809 23,650
Bank transaction and checking fees....... 12,683 14,340 16,176 6,702
Registration fees........................ 26,582 33,373 11,308 19,828
Legal, insurance and auditing fees....... 16,040 17,704 15,305 24,916
Other.................................... 3,624 6,520 3,872 6,208
------------- ------------- ------------------- -------------
Total expenses......................... 3,296,177 5,010,634 1,122,574 5,901,982
------------- ------------- ------------------- -------------
Net investment income (Note 1)............. 3,237,970 2,201,924 316,618 352,360
------------- ------------- ------------------- -------------
REALIZED GAIN (LOSS) AND UNREALIZED
APPRECIATION (DEPRECIATION) FROM INVESTMENT
AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) from:
Investments (Note 2) (1)................. 73,273,622 92,027,391 (2,665,575) 101,287,000
Foreign currency transactions (Note 1)... (636,316)
------------- ------------- ------------------- -------------
Net realized gain (loss)............... 73,273,622 92,027,391 (3,301,891) 101,287,000
------------- ------------- ------------------- -------------
Net unrealized appreciation (depreciation)
on:
Investments (Note 1)..................... 51,289,077 198,902,661 21,433,318 (2,904,678)
Translation of assets and liabilities in
foreign currencies (Note 1)............. (127,849)
------------- ------------- ------------------- -------------
Net unrealized appreciation
(depreciation) during the period...... 51,289,077 198,902,661 21,305,469 (2,904,678)
------------- ------------- ------------------- -------------
Net gain on investment and foreign currency
transactions (Note 1)..................... 124,562,699 290,930,052 18,003,578 98,382,322
------------- ------------- ------------------- -------------
Net increase in net assets resulting from
operations................................ $127,800,669 $ 293,131,976 $18,320,196 $ 98,734,682
------------- ------------- ------------------- -------------
------------- ------------- ------------------- -------------
</TABLE>
(1) The net realized gain for CSF includes $1,283,032 loss from affiliated
issuers. (Note 1)
The accompanying notes are an integral part of the financial statements.
69
<PAGE>
STATEMENTS OF OPERATIONS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
Six Months Ended June 30, 1998 COLUMBIA SMALL REAL ESTATE EQUITY BALANCED DAILY INCOME
(Unaudited) CAP FUND, INC. FUND, INC. FUND, INC. COMPANY
-------------- ------------------ ------------- ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Income:
Interest...................................... $ 247,047 $ 305,258 $ 14,954,685 $29,554,870
Dividends..................................... 90,716 3,590,126 2,931,553
-------------- ------------------ ------------- ------------
Total income................................ 337,763 3,895,384 17,886,238 29,554,870
-------------- ------------------ ------------- ------------
Expenses:
Investment management fees (Note 4)........... 598,044 609,353 2,201,334 2,457,758
Shareholder servicing costs (Note 4).......... 98,854 108,152 497,599 476,318
Reports to shareholders....................... 15,948 17,341 65,457 134,595
Accounting expense............................ 13,384 12,952 18,936 31,820
Financial information and subscriptions....... 1,093 1,331 7,996 8,412
Custodian fees................................ 1,678 2,181 14,008 27,171
Bank transaction and checking fees............ 7,029 4,707 13,952 115,265
Registration fees............................. 12,539 18,789 29,265 35,390
Legal, insurance and auditing fees............ 6,780 7,576 17,343 30,569
Other......................................... 576 708 4,028 8,595
-------------- ------------------ ------------- ------------
Total expenses.............................. 755,925 783,090 2,869,918 3,325,893
-------------- ------------------ ------------- ------------
Net investment income (loss) (Note 1)........... (418,162) 3,112,294 15,016,320 26,228,977
-------------- ------------------ ------------- ------------
REALIZED GAIN (LOSS) AND UNREALIZED APPRECIATION
(DEPRECIATION) FROM INVESTMENT TRANSACTIONS:
Net realized gain (loss) from investments (Note
2)............................................. 3,272,493 (49,757) 45,331,834
Net unrealized appreciation (depreciation) on
investments during the period (Note 1)......... 6,320,565 (10,431,337) 37,317,852
-------------- ------------------ -------------
Net gain (loss) on investments (Note 1)......... 9,593,058 (10,481,094) 82,649,686
-------------- ------------------ ------------- ------------
Net increase (decrease) in net assets resulting
from operations................................ $ 9,174,896 $(7,368,800) $ 97,666,006 $26,228,977
-------------- ------------------ ------------- ------------
-------------- ------------------ ------------- ------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
70
<PAGE>
STATEMENTS OF OPERATIONS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
COLUMBIA U.S. COLUMBIA FIXED COLUMBIA COLUMBIA
Six Months Ended June 30, 1998 GOVERNMENT SECURITIES INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
(Unaudited) FUND, INC. FUND, INC. FUND, INC. FUND, INC.
--------------------- ----------------- -------------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Income:
Interest................................. $1,043,886 $13,774,192 $10,753,706 $2,005,537
----------- ----------------- -------------- -----------
Total income........................... 1,043,886 13,774,192 10,753,706 2,005,537
----------- ----------------- -------------- -----------
Expenses:
Investment management fees (Note 4)...... 93,480 990,783 1,027,819 139,977
Shareholder servicing costs (Note 4)..... 30,560 162,653 63,566 29,685
Reports to shareholders.................. 5,399 32,428 9,732 8,629
Accounting expense....................... 15,512 16,551 14,838 21,220
Financial information and
subscriptions........................... 531 6,034 15,814 2,140
Custodian fees........................... 624 6,320 6,078 1,065
Bank transaction and checking fees....... 598 8,331 2,774 2,446
Registration fees........................ 5,882 15,738 7,903 14,674
Legal, insurance and auditing fees....... 9,762 16,443 13,018 12,327
Other.................................... 213 1,306 1,519 346
----------- ----------------- -------------- -----------
Total expenses......................... 162,561 1,256,587 1,163,061 232,509
----------- ----------------- -------------- -----------
Net investment income (Note 1)............. 881,325 12,517,605 9,590,645 1,773,028
----------- ----------------- -------------- -----------
REALIZED GAIN (LOSS) AND UNREALIZED
APPRECIATION (DEPRECIATION) FROM INVESTMENT
AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) from investments
(Note 2).................................. 111,587 2,061,260 2,706,240 447,950
Net unrealized depreciation on investments
during the period (Note 1)................ (31,219) (24,410) (3,372,676) (235,088)
----------- ----------------- -------------- -----------
Net gain (loss) on investments (Note 1).... 80,368 2,036,850 (666,436) 212,862
----------- ----------------- -------------- -----------
Net increase in net assets resulting from
operations................................ $ 961,693 $14,554,455 $ 8,924,209 $1,985,890
----------- ----------------- -------------- -----------
----------- ----------------- -------------- -----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
71
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended June 30, 1998 COLUMBIA COLUMBIA COLUMBIA
(Unaudited) and COMMON STOCK GROWTH INTERNATIONAL STOCK
Year Ended December 31, 1997 FUND, INC. FUND, INC. FUND, INC.
--------------------------- ------------------------------- ---------------------------
1998 1997 1998 1997 1998 1997
------------ ------------ -------------- -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment income........ $ 3,237,970 $ 9,354,883 $ 2,201,924 $ 6,692,676 $ 316,618 $ 276,986
Net realized gain (loss)
from:
Investments (Note 2)....... 73,273,622 61,630,849 92,027,391 150,238,079 (2,665,575) 17,347,526
Foreign currency
transactions (Note 1)..... (636,316) (286,335)
Change in net unrealized
appreciation (depreciation)
on:
Investments................ 51,289,077 76,981,002 198,902,661 122,000,869 21,433,318 (1,735,993)
Translation of assets and
liabilities in foreign
currencies (Note 1)....... (127,849) (67,221)
------------ ------------ -------------- -------------- ------------ ------------
Net increase in net assets
resulting from operations... 127,800,669 147,966,734 293,131,976 278,931,624 18,320,196 15,534,963
Distributions to shareholders:
From net investment income... (2,919,990) (8,468,207) (5,838,423)
From net realized gain from
investment transactions..... (61,141,619) (148,364,649) (16,691,558)
Capital share transactions, net
(Note 3)...................... 12,472,927 168,789,109 72,308,276 136,089,618 (11,506,690) 21,927,539
------------ ------------ -------------- -------------- ------------ ------------
Net increase in net assets... 137,353,606 247,146,017 365,440,252 260,818,170 6,813,506 20,770,944
NET ASSETS:
Beginning of period............ 783,905,819 536,759,802 1,324,917,689 1,064,099,519 146,280,535 125,509,591
------------ ------------ -------------- -------------- ------------ ------------
End of period (1).............. $921,259,425 $783,905,819 $1,690,357,941 $1,324,917,689 $153,094,041 $146,280,535
------------ ------------ -------------- -------------- ------------ ------------
------------ ------------ -------------- -------------- ------------ ------------
- --------------------------------- ------------ ------------ -------------- -------------- ------------ ------------
(1) Includes undistributed net
investment income of: $ 1,855,343 $ 1,537,363 $ 4,201,503 $ 1,999,579 $ 316,618 $ --
</TABLE>
The accompanying notes are an integral part of the financial statements.
72
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended June 30, 1998 COLUMBIA COLUMBIA COLUMBIA
(Unaudited) and SPECIAL SMALL CAP REAL ESTATE EQUITY
Year Ended December 31, 1997 FUND, INC. FUND, INC. FUND, INC.
--------------------------- ------------------------------- ---------------------------
1998 1997 1998 1997 1998 1997
------------ ------------ -------------- -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS:
Operations:
Net investment income
(loss)...................... $ 352,360 $ 531,773 $ (418,162) $ (443,585) $ 3,112,294 $ 5,578,378
Net realized gain (loss) from
investments (Note 2)........ 101,287,000 122,678,842 3,272,493 4,931,098 (49,757) 3,597,873
Change in net unrealized
appreciation (depreciation)
on investments.............. (2,904,678) 49,916,627 6,320,565 7,895,606 (10,431,337) 16,211,982
------------ ------------ -------------- -------------- ------------ ------------
Net increase (decrease) in
net assets resulting from
operations.................. 98,734,682 173,127,242 9,174,896 12,383,119 (7,368,800) 25,388,233
Distributions to shareholders:
From net investment income... (3,088,196)** (4,230,674)
From net realized gain from
investment transactions..... (122,678,842) (4,258,935) (3,597,873)
In excess of net realized
gain from investment
transactions................ (154,157)* (243,742)*
From tax return of capital... (1,252,467)
Capital share transactions, net
(Note 3)...................... (250,929,166) (385,860,660) 33,143,632 67,245,755 30,014,593 67,417,742
------------ ------------ -------------- -------------- ------------ ------------
Net increase (decrease) in
net assets.................. (152,194,484) (335,566,417) 42,318,528 75,369,939 19,557,597 83,481,219
NET ASSETS:
Beginning of period............ 1,249,717,797 1,585,284,214 96,431,309 21,061,370 151,554,440 68,073,221
------------ ------------ -------------- -------------- ------------ ------------
End of period (1).............. $1,097,523,313 $1,249,717,797 $ 138,749,837 $ 96,431,309 $171,112,037 $151,554,440
------------ ------------ -------------- -------------- ------------ ------------
------------ ------------ -------------- -------------- ------------ ------------
- ---------------------------------
------------ ------------ -------------- -------------- ------------ ------------
(1) Includes undistributed net
investment income (loss) of: $ 712,433 $ 360,073 $ (418,162) $ -- $ 24,098 $ --
</TABLE>
* On a tax basis, there was no return of capital.
** On a tax basis, a portion of the distributions to shareholders from net
investment income may consist of return of capital. The Fund will mail to
its shareholders annually a summary of the federal income tax status of the
Fund's distributions for the preceeding year.
The accompanying notes are an integral part of the financial statements.
73
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended June 30, 1998 COLUMBIA COLUMBIA COLUMBIA
(Unaudited) and BALANCED DAILY INCOME U.S. GOVERNMENT
Year Ended December 31, 1997 FUND, INC. COMPANY SECURITIES FUND, INC.
-------------------------- ------------------------------ ------------------------
1998 1997 1998 1997 1998 1997
------------ ------------ -------------- -------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income............. $ 15,016,320 $ 29,022,353 $ 26,228,977 $ 44,915,266 $ 881,325 $ 1,946,052
Net realized gain from investments
(Note 2)......................... 45,331,834 62,144,958 111,587 147,024
Change in net unrealized
appreciation (depreciation) on
investments...................... 37,317,852 38,270,990 (31,219) 63,763
------------ ------------ -------------- -------------- ----------- -----------
Net increase in net assets
resulting from operations........ 97,666,006 129,438,301 26,228,977 44,915,266 961,693 2,156,839
Distributions to shareholders:
From net investment income........ (14,602,894) (28,593,156) (26,228,977) (44,915,266) (881,325) (1,946,052)
From net realized gain from
investment transactions.......... (61,376,451)
Capital share transactions, net
(Note 3)........................... 66,389,019 80,316,642 (142,720,316) 279,295,599 1,205,893 (3,150,453)
------------ ------------ -------------- -------------- ----------- -----------
Net increase (decrease) in net
assets........................... 149,452,131 119,785,336 (142,720,316) 279,295,599 1,286,261 (2,939,666)
NET ASSETS:
Beginning of period................. 792,378,256 672,592,920 1,169,095,568 889,799,969 37,836,675 40,776,341
------------ ------------ -------------- -------------- ----------- -----------
End of period....................... $941,830,387 $792,378,256 $1,026,375,252 $1,169,095,568 $39,122,936 $37,836,675
------------ ------------ -------------- -------------- ----------- -----------
------------ ------------ -------------- -------------- ----------- -----------
- --------------------------------------
------------ ------------ -------------- -------------- ----------- -----------
(1) Includes undistributed net
investment income of: $ 1,171,463 $ 758,037
</TABLE>
The accompanying notes are an integral part of the financial statements.
74
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
-----------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended June 30, 1998 COLUMBIA COLUMBIA COLUMBIA
(Unaudited) and FIXED INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
Year Ended December 31, 1997 FUND, INC. FUND, INC. FUND, INC.
-------------------------- ------------------------------ ------------------------
1998 1997 1998 1997 1998 1997
------------ ------------ -------------- -------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment income............. $ 12,517,604 $ 23,438,026 $ 9,590,645 $ 19,046,726 $ 1,773,028 $ 2,832,822
Net realized gain from investments
(Note 2)......................... 2,061,260 2,758,117 2,706,240 2,429,586 447,950 1,148,575
Change in net unrealized
appreciation (depreciation) on
investments...................... (24,410) 7,594,450 (3,372,676) 10,155,954 (235,088) 279,884
------------ ------------ -------------- -------------- ----------- -----------
Net increase in net assets
resulting from operations........ 14,554,454 33,790,593 8,924,209 31,632,266 1,985,890 4,261,281
Distributions to shareholders:
From net investment income........ (12,517,604) (23,438,026) (9,590,645) (19,046,726) (1,773,028) (2,832,822)
In excess of net investment
income........................... (4,724)*
From net realized gain from
investment transactions.......... (847,470) (2,276,966) (1,136,542)
Capital share transactions, net
(Note 3)........................... 28,166,638 15,406,761 9,100,749 23,176,895 11,022,370 10,168,259
------------ ------------ -------------- -------------- ----------- -----------
Net increase in net assets........ 30,203,488 24,911,858 8,434,313 33,480,745 11,235,232 10,460,176
NET ASSETS:
Beginning of period................. 381,332,754 356,420,896 409,148,175 375,667,430 39,278,409 28,818,233
------------ ------------ -------------- -------------- ----------- -----------
End of period....................... $411,536,242 $381,332,754 $ 417,582,488 $ 409,148,175 $50,513,641 $39,278,409
------------ ------------ -------------- -------------- ----------- -----------
------------ ------------ -------------- -------------- ----------- -----------
</TABLE>
* On a tax basis, there was no return of capital.
The accompanying notes are an integral part of the financial statements.
75
<PAGE>
NOTES TO FINANCIAL STATEMENTS
-----------------------------------------------------------------
-- 1. SIGNIFICANT ACCOUNTING POLICIES: --
The Columbia Funds (the Funds) consist of Columbia Common Stock Fund, Inc.
(CCSF), Columbia Growth Fund, Inc. (CGF), Columbia International Stock Fund,
Inc. (CISF), Columbia Special Fund, Inc. (CSF), Columbia Small Cap Fund, Inc.
(CSCF), Columbia Real Estate Equity Fund, Inc. (CREF), Columbia Balanced Fund,
Inc. (CBF), Columbia Daily Income Company (CDIC), Columbia U.S. Government
Securities Fund, Inc. (CUSG), Columbia Fixed Income Securities Fund, Inc.
(CFIS), Columbia Municipal Bond Fund, Inc. (CMBF), and Columbia High Yield Fund,
Inc. (CHYF). All Funds are open-end investment companies registered under the
Investment Company Act of 1940, as amended, and are diversified except CMBF,
which is non-diversified. The policies described below are consistently followed
by the Funds in the preparation of their financial statements in conformity with
generally accepted accounting principles.
INVESTMENT VALUATION. The values of CCSF, CGF, CISF, CSF, CSCF, CREF and CBF
equity investments are based on the last sale prices reported by the principal
securities exchanges on which the investments are traded, or, in the absence of
recorded sales, at the closing bid prices on such exchanges or over-the-counter
markets. Temporary cash investments in short-term securities (principally
repurchase agreements) are valued at cost, which approximates market.
CDIC investments are carried at values deemed best to reflect their fair values
as determined in good faith by or under the supervision of officers of CDIC,
specifically so authorized by its Directors. These values are based on cost
adjusted for amortization of discount or premium and accrued interest, unless
unusual circumstances indicate that another method of determining fair value
should be considered.
CBF, CUSG, CFIS, CMBF and CHYF fixed income investments are carried at values
deemed best to reflect their fair values as determined in good faith by or under
the supervision of officers of CBF, CUSG, CFIS, CMBF and CHYF, specifically so
authorized by their Directors. These values are based on market value as quoted
by dealers who are market makers in these securities or by an independent
pricing service unless unusual circumstances indicate that another method of
determining fair value should be considered. Market values for CBF, CUSG, CFIS
and CHYF fixed income investments are based on the average of bid and ask prices
and market value for CMBF is based on bid prices, or by reference to other
securities with comparable ratings, interest rates and maturities. Temporary
cash investments in short-term securities (principally repurchase agreements)
are valued at cost, which approximates market.
76
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 1. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED --
AFFILIATED ISSUERS. Under the Investment Company Act of 1940, as amended, an
issuer is an "affiliated issuer" of a Fund if the Fund holds 5% or more of that
issuer's outstanding voting securities or is held under common control. CSF had
investments in such affiliated issuers at June 30, 1998 as follows:
<TABLE>
<CAPTION>
DIVIDEND INCOME
BALANCE OF BALANCE OF JANUARY 1,
SHARES HELD GROSS GROSS SHARES HELD VALUE 1998-
DECEMBER 31, PURCHASES & SALES & JUNE 30, JUNE 30, JUNE 30,
NAME OF ISSUER 1997 ADDITIONS REDUCTIONS 1998 1998 1998
- ------------------------------ ---------------- ----------- ---------- ---------------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Columbia Special Fund (a)
AnnTaylor Stores Corp......... 1,240,000 160,000 1,400,000 $ 29,662,500
Celadon Group, Inc............ 500,000 500,000 9,500,000
Crown Craft, Inc.............. -- 544,800 544,800 8,376,300 $ 15,000
Gadzooks, Inc................. 700,000 10,000 710,000 19,569,375
Integrated Measurement Syst... 300,000 300,000 --
Osmonics, Inc................. 869,000 108,300 977,300 11,666,519
Resmed, Inc................... 500,000 5,000 505,000 23,009,063
Schnitzer Steel Industries.... 550,000 550,000 --
Vans, Inc..................... 860,000 15,000 60,000 815,000 7,895,313
Columbia Balanced Fund (b)
Fleet Mortgage Group, Inc..... 550,000 550,000 --
------------- -------
Total Affiliated Issuers.................................................................. $ 109,679,070 $ 15,000
------------- -------
------------- -------
</TABLE>
(a) Fund holds 5% or more of that issuer's outstanding shares. During the
period CSF held 800,000 shares of Abercrombie & Fitch Co. This was more
than 5% of that issuer's outstanding shares, until May 1998, when
additional shares were issued. At that point Abercrombie & Fitch Co. was
no longer considered an affiliate of CSF, since less than 5% of
outstanding shares were held.
(b) Fund held an investment under common control. (Note 4)
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. CISF enters into forward foreign
currency exchange contracts to hedge certain portfolio securities denominated in
foreign currencies. Forward contracts are recorded at market value. CISF could
be exposed to risks if counterparties to the forward contracts are unable to
meet the terms of their contracts or if the value of the foreign currency
changes unfavorably. The effect of any change in the value of a hedged foreign
currency would be offset by the increase (resulting from a change in exchange
rates) in value of the securities denominated in that currency. Net realized
loss arising from forward contracts amounted to $614,553 and are included in net
realized loss from foreign currency transactions. CISF had no outstanding
forward contracts on June 30, 1998.
77
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 1. SIGNIFICANT ACCOUNTING POLICIES, --
CONTINUED
FOREIGN CURRENCY TRANSLATIONS. The books and records of CISF are maintained in
U.S. dollars. Foreign currency transactions are translated into U.S. dollars on
the following basis:
(i) market value of investment securities, other assets, and liabilities at
the daily rates of exchange on the valuation date, and
(ii) purchases and sales of investment securities, dividend and interest income
and certain expenses at the rates of exchange prevailing on the respective
dates of such transactions.
CISF does not isolate that portion of the results of operations resulting from
changes in foreign exchange rates on investments from the fluctuations arising
from changes in market prices of securities held. Such changes are included with
the net realized and unrealized gain or loss from investments.
Reported net realized foreign currency gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, currency gains
or losses realized between the trade and settlement dates on securities
transactions, and the difference between the amounts of dividends, interest, and
foreign withholding taxes recorded on CISF's books and the U.S. dollar
equivalent of the amounts actually received or paid. Net unrealized foreign
exchange gains and losses arise from changes in the value of assets and
liabilities, other than investments in securities, resulting from changes in the
exchange rates.
INTEREST AND DIVIDEND INCOME. Interest income is recorded on the accrual basis
and dividend income is recorded on the ex-dividend date. The majority of
dividend income recorded by CREF is from Real Estate Investment Trusts (REITs).
For tax purposes, a portion of these dividends consist of capital gains and
return of capital. For financial reporting purposes, these dividends are
recorded as dividend income.
SHAREHOLDER DISTRIBUTIONS. CCSF, CREF and CBF distribute net investment income
quarterly and any net realized gains from investment transactions annually. CGF,
CISF, CSF and CSCF distribute net investment income and any net realized gains
annually. CDIC distributes its net investment income daily - including any
realized investment gains or losses. CUSG, CFIS, CMBF and CHYF distribute their
net investment income monthly and any net realized gains annually. Distributions
to shareholders are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with income
tax regulations, which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for foreign currency
transactions, net operating losses, deferral of losses from wash sales and
return of capital received from REITS.
USE OF ESTIMATES. The preparation of the financial statements in accordance
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
FEDERAL INCOME TAXES. The Funds have made no provision for federal income taxes
on net investment income or net realized gains from sales of securities, since
it is the intention of the Funds to comply with the provisions of the Internal
Revenue Code available to certain investment companies, and to make
distributions of income and security profits sufficient to relieve them from
substantially all federal income taxes.
78
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 1. SIGNIFICANT ACCOUNTING POLICIES, --
CONTINUED
OTHER. Investment transactions are accounted for on the date the investments
are purchased or sold. The cost of investments sold is determined by the use of
the specific identification method for both financial reporting and income tax
purposes. Realized gains and losses from investment transactions and unrealized
appreciation or depreciation of investments are reported on the basis of
identified costs. The Funds, through their custodians, receive delivery of
underlying securities collateralizing repurchase agreements (included in
temporary cash investments). Market values of these securities are required to
be at least 100% of the cost of the repurchase agreements. The Funds' investment
advisor determines that the value of the underlying securities is at all times
at least equal to the resale price. 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.
CHYF invests in lower rated debt securities, which may be more susceptible to
adverse economic conditions than investment grade holdings. These securities are
often subordinated to the prior claims of other senior lenders, and
uncertainties exist as to an issuer's ability to meet principal and interest
payments. At June 30, 1998, 42% of the Fund's debt securities were rated Ba and
58% were rated B by Moody's Investor Services, Inc.
79
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 2. INVESTMENT TRANSACTIONS --
Aggregate purchases, sales and maturities, net realized gain (loss) and
unrealized appreciation (depreciation) of investments, including temporary cash
investments for CDIC and excluding temporary cash investments for all other
Funds, as of and for the period ended June 30, 1998, were as follows:
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
COMMON STOCK GROWTH INTERNATIONAL STOCK SPECIAL
FUND, INC. (CCSF) FUND, INC. (CGF) FUND, INC. (CISF) FUND, INC. (CSF)
----------------- ---------------- ------------------- ----------------
<S> <C> <C> <C> <C>
PURCHASES:
Investment securities other than
U.S. Government obligations..... $687,552,683 $ 895,797,540 $ 61,338,398 $ 767,338,059
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
SALES AND MATURITIES:
Investment securities other than
U.S. Government obligations..... $648,216,660 $ 844,518,395 $ 64,108,730 $1,069,218,036
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
NET REALIZED GAIN (LOSS):
Investment securities other than
U.S. Government obligations..... $ 73,273,622 $ 92,027,391 $ (2,665,575) $ 101,287,000
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
UNREALIZED APPRECIATION
(DEPRECIATION) AS OF JUNE 30,
1998:
Appreciation..................... $197,830,716 $ 512,747,036 $ 44,559,590 $ 196,292,355
Depreciation..................... (8,672,528) (10,576,353) (8,219,147) (60,997,328)
----------------- ---------------- ------------------- ----------------
Net unrealized appreciation.... $189,158,188 $ 502,170,683 $ 36,340,443 $ 135,295,027
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
UNREALIZED APPRECIATION
(DEPRECIATION) FOR FEDERAL INCOME
TAX PURPOSES AS OF JUNE 30, 1998:
Appreciation..................... $197,683,927 $ 512,620,917 $ 44,550,371 $ 195,879,854
Depreciation..................... (8,693,770) (10,576,353) (8,484,910) (61,968,222)
----------------- ---------------- ------------------- ----------------
Net unrealized appreciation.... $188,990,157 $ 502,044,564 $ 36,065,461 $ 133,911,632
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
For federal income tax purposes,
the cost of investments owned at
June 30, 1998..................... $703,861,382 $1,141,994,820 $110,191,978 $ 881,175,551
----------------- ---------------- ------------------- ----------------
----------------- ---------------- ------------------- ----------------
</TABLE>
The net realized gain for CGF and CSF includes proceeds of $86,468 and $134,882,
respectively, from shareholder class action suits related to securities held by
those Funds.
80
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 2. INVESTMENT TRANSACTIONS, CONTINUED --
<TABLE>
<CAPTION>
COLUMBIA
COLUMBIA REAL ESTATE COLUMBIA COLUMBIA
SMALL CAP EQUITY FUND, INC. BALANCED DAILY INCOME
FUND, INC. (CSCF) (CREF) FUND, INC. (CBF) COMPANY (CDIC)
----------------- ----------------- ---------------- ---------------
<S> <C> <C> <C> <C>
PURCHASES:
Investment securities other than U.S.
Government obligations............... $111,229,388 $ 39,134,752 $ 402,069,573 $5,507,507,755
U.S. Government obligations........... 236,382,774
----------------- ----------------- ---------------- ---------------
Total purchases..................... $111,229,388 $ 39,134,752 $ 638,452,347 $5,507,507,755
----------------- ----------------- ---------------- ---------------
----------------- ----------------- ---------------- ---------------
SALES AND MATURITIES:
Investment securities other than U.S.
Government obligations............... $ 88,436,946 $ 8,636,075 $ 284,796,612 $5,647,302,799
U.S. Government obligations........... 298,645,677
----------------- ----------------- ---------------- ---------------
Total sales and maturities.......... $ 88,436,946 $ 8,636,075 $ 583,442,289 $5,647,302,799
----------------- ----------------- ---------------- ---------------
----------------- ----------------- ---------------- ---------------
NET REALIZED GAIN (LOSS):
Investment securities other than U.S.
Government obligations............... $ 3,272,493 $ (49,757) $ 45,608,554
U.S. Government obligations........... (276,720)
----------------- ----------------- ----------------
Total net realized gain (loss)...... $ 3,272,493 $ (49,757) $ 45,331,834
----------------- ----------------- ----------------
----------------- ----------------- ----------------
UNREALIZED APPRECIATION (DEPRECIATION)
AS OF JUNE 30, 1998:...................
Appreciation.......................... $ 21,269,542 $ 19,031,410 $ 137,424,943
Depreciation.......................... (5,564,618) (2,345,933) (5,786,733)
----------------- ----------------- ----------------
Net unrealized appreciation......... $ 15,704,924 $ 16,685,477 $ 131,638,210
----------------- ----------------- ----------------
----------------- ----------------- ----------------
UNREALIZED APPRECIATION (DEPRECIATION)
FOR FEDERAL INCOME TAX PURPOSES AS OF
JUNE 30, 1998:
Appreciation.......................... $ 21,269,542 $ 21,060,159 $ 137,323,540
Depreciation.......................... (5,613,266) (2,340,209) (5,816,063)
----------------- ----------------- ----------------
Net unrealized appreciation......... $ 15,656,276 $ 18,719,950 $ 131,507,477
----------------- ----------------- ----------------
----------------- ----------------- ----------------
For federal income tax purposes, the
cost of investments owned at June 30,
1998................................... $110,067,285 $141,459,390 $ 787,860,511 $1,033,953,887
----------------- ----------------- ---------------- ---------------
----------------- ----------------- ---------------- ---------------
</TABLE>
81
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 2. INVESTMENT TRANSACTIONS, CONTINUED --
<TABLE>
<CAPTION>
COLUMBIA U.S. COLUMBIA FIXED COLUMBIA COLUMBIA
GOVERNMENT SECURITIES INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
FUND, INC. (CUSG) FUND, INC. (CFIS) FUND, INC. (CMBF) FUND, INC. (CHYF)
--------------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
PURCHASES:
Investment securities other than U.S.
Government obligations............... $ 70,487,779 $ 52,308,325 $29,515,204
U.S. Government obligations........... $30,561,662 161,566,965
--------------------- ----------------- ----------------- -----------------
Total purchases..................... $30,561,662 $232,054,744 $ 52,308,325 $29,515,204
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
SALES AND MATURITIES:
Investment securities other than U.S.
Government obligations............... $ 44,935,895 $ 37,823,691 $17,504,679
U.S. Government obligations........... $29,048,341 149,463,131
--------------------- ----------------- ----------------- -----------------
Total sales and maturities.......... $29,048,341 $194,399,026 $ 37,823,691 $17,504,679
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
NET REALIZED GAIN:
Investment securities other than U.S.
Government obligations............... $ 576,904 $ 2,706,240 $ 447,950
U.S. Government obligations........... $ 111,587 1,484,356
--------------------- ----------------- ----------------- -----------------
Total net realized gain............. $ 111,587 $ 2,061,260 $ 2,706,240 $ 447,950
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
UNREALIZED APPRECIATION (DEPRECIATION)
AS OF JUNE 30, 1998:
Appreciation.......................... $ 83,582 $ 10,069,762 $ 20,851,215 $ 1,097,580
Depreciation.......................... (23,851) (494,278) (160,521) (202,004)
--------------------- ----------------- ----------------- -----------------
Net unrealized appreciation......... $ 59,731 $ 9,575,484 $ 20,690,694 $ 895,576
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
UNREALIZED APPRECIATION (DEPRECIATION)
FOR FEDERAL INCOME TAX PURPOSES AS OF
JUNE 30, 1998:
Appreciation.......................... $ 76,723 $ 10,045,300 $ 20,842,272 $ 1,097,580
Depreciation.......................... (23,851) (494,278) (160,521) (202,729)
--------------------- ----------------- ----------------- -----------------
Net unrealized appreciation......... $ 52,872 $ 9,551,022 $ 20,681,751 $ 894,851
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
For federal income tax purposes, the
cost of investments owned at June 30,
1998................................... $38,614,792 $391,882,682 $391,040,866 $46,496,495
--------------------- ----------------- ----------------- -----------------
--------------------- ----------------- ----------------- -----------------
</TABLE>
82
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 3. CAPITAL STOCK --
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
COMMON STOCK GROWTH INTERNATIONAL STOCK
FUND, INC. (CCSF) FUND, INC. (CGF) FUND, INC. (CISF)
----------------------------- ------------------------------- -----------------------------
1998 1997 1998 1997 1998 1997
------------- ------------- -------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
SHARES:
Shares sold................... 7,399,015 12,609,458 6,492,273 9,453,209 2,897,301 6,414,910
Shares issued for reinvestment
of dividends................. 116,410 3,039,307 4,230,608 1,146,267
------------- ------------- -------------- -------------- ------------- -------------
7,515,425 15,648,765 6,492,273 13,683,817 2,897,301 7,561,177
Less shares redeemed.......... (6,834,619) (7,908,821) (4,577,065) (9,715,431) (3,689,151) (5,939,634)
------------- ------------- -------------- -------------- ------------- -------------
Net increase (decrease) in
shares....................... 680,806 7,739,944 1,915,208 3,968,386 (791,850) 1,621,543
------------- ------------- -------------- -------------- ------------- -------------
------------- ------------- -------------- -------------- ------------- -------------
AMOUNTS:
Sales......................... $ 171,971,507 $ 277,332,028 $ 246,733,324 $ 329,861,186 $ 42,078,095 $ 98,515,375
Reinvestment of dividends..... 2,886,723 66,961,124 145,279,077 15,703,862
------------- ------------- -------------- -------------- ------------- -------------
174,858,230 344,293,152 246,733,324 475,140,263 42,078,095 114,219,237
Less redemptions.............. (162,385,303) (175,504,043) (174,425,048) (339,050,645) (53,584,785) (92,291,698)
------------- ------------- -------------- -------------- ------------- -------------
Net increase (decrease)....... $ 12,472,927 $ 168,789,109 $ 72,308,276 $ 136,089,618 $ (11,506,690) $ 21,927,539
------------- ------------- -------------- -------------- ------------- -------------
------------- ------------- -------------- -------------- ------------- -------------
Capital stock authorized
(shares)..................... 100,000,000 100,000,000 100,000,000
Par Value..................... no par $ .01 no par
</TABLE>
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA
SPECIAL SMALL CAP REAL ESTATE EQUITY
FUND, INC. (CSF) FUND, INC. (CSCF) FUND, INC. (CREF)
------------------------------- ---------------------------- -----------------------------
1998 1997 1998 1997 1998 1997
-------------- -------------- ------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
SHARES:
Shares sold...................... 8,369,150 17,301,738 4,024,881 6,092,245 4,504,332 9,713,082
Shares issued for reinvestment of
dividends....................... 5,787,116 229,093 154,401 444,904
-------------- -------------- ------------- ------------ ------------- -------------
8,369,150 23,088,854 4,024,881 6,321,338 4,658,733 10,157,986
Less shares redeemed............. (20,168,961) (41,278,382) (2,162,921) (2,149,149) (3,029,953) (6,308,136)
-------------- -------------- ------------- ------------ ------------- -------------
Net increase (decrease) in
shares.......................... (11,799,811) (18,189,528) 1,861,960 4,172,189 1,628,780 3,849,850
-------------- -------------- ------------- ------------ ------------- -------------
-------------- -------------- ------------- ------------ ------------- -------------
AMOUNTS:
Sales............................ $ 176,063,560 $ 365,659,534 $ 71,148,400 $ 97,707,061 $ 82,772,333 $ 168,764,062
Reinvestment of dividends........ 117,246,979 3,814,406 2,790,016 8,209,513
-------------- -------------- ------------- ------------ ------------- -------------
176,063,560 482,906,513 71,148,400 101,521,467 85,562,349 176,973,575
Less redemptions................. (426,992,726) (868,767,173) (38,004,768) (34,275,712) (55,547,756) (109,555,833)
-------------- -------------- ------------- ------------ ------------- -------------
Net increase (decrease).......... $ (250,929,166) $ (385,860,660) $ 33,143,632 $ 67,245,755 $ 30,014,593 $ 67,417,742
-------------- -------------- ------------- ------------ ------------- -------------
-------------- -------------- ------------- ------------ ------------- -------------
Capital stock authorized
(shares)........................ 100,000,000 100,000,000 100,000,000
Par Value........................ $ .01 no par no par
</TABLE>
83
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 3. CAPITAL STOCK, CONTINUED --
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA U.S.
BALANCED DAILY INCOME GOVERNMENT SECURITIES
FUND, INC. (CBF) COMPANY (CDIC) FUND, INC. (CUSG)
----------------------------- --------------------------------- ---------------------------
1998 1997 1998 1997 1998 1997
------------- ------------- --------------- --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
SHARES:
Shares sold................... 6,732,881 11,631,390 836,158,670 1,948,660,105 1,093,935 1,678,641
Shares issued for reinvestment
of dividends................. 619,037 4,143,787 26,214,054 44,892,534 98,828 214,917
------------- ------------- --------------- --------------- ------------ ------------
7,351,918 15,775,177 862,372,724 1,993,552,639 1,192,763 1,893,558
Less shares redeemed.......... (4,363,468) (11,880,698) (1,005,093,040) (1,714,257,040) (1,047,159) (2,278,311)
------------- ------------- --------------- --------------- ------------ ------------
Net increase (decrease) in
shares....................... 2,988,450 3,894,479 (142,720,316) 279,295,599 145,604 (384,753)
------------- ------------- --------------- --------------- ------------ ------------
------------- ------------- --------------- --------------- ------------ ------------
AMOUNTS:
Sales......................... $ 151,124,317 $ 255,961,711 $ 836,158,670 $ 1,948,660,105 $ 9,088,819 $ 13,843,228
Reinvestment of dividends..... 14,394,131 89,309,106 26,214,054 44,892,534 821,136 1,771,509
------------- ------------- --------------- --------------- ------------ ------------
165,518,448 345,270,817 862,372,724 1,993,552,639 9,909,955 15,614,737
Less redemptions.............. (99,129,429) (264,954,175) (1,005,093,040) (1,714,257,040) (8,704,062) (18,765,190)
------------- ------------- --------------- --------------- ------------ ------------
Net increase (decrease)....... $ 66,389,019 $ 80,316,642 $ (142,720,316) $ 279,295,599 $ 1,205,893 $ (3,150,453)
------------- ------------- --------------- --------------- ------------ ------------
------------- ------------- --------------- --------------- ------------ ------------
Capital stock authorized
(shares)..................... 100,000,000 2,000,000,000 100,000,000
Par Value..................... no par $ .001 $ .01
</TABLE>
<TABLE>
<CAPTION>
COLUMBIA FIXED COLUMBIA COLUMBIA
INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
FUND, INC. (CFIS) FUND, INC. (CMBF) FUND, INC. (CHYF)
----------------------------- ----------------------------- -----------------------------
1998 1997 1998 1997 1998 1997
------------- ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
SHARES:
Shares sold...................... 5,828,012 8,909,289 4,797,289 6,372,612 2,022,726 2,127,208
Shares issued for reinvestment of
dividends....................... 730,284 1,456,925 606,952 1,369,697 157,720 342,994
------------- ------------- ------------- ------------- ------------- -------------
6,558,296 10,366,214 5,404,241 7,742,309 2,180,446 2,470,202
Less shares redeemed............. (4,460,413) (9,188,186) (4,668,493) (5,853,872) (1,090,969) (1,457,004)
------------- ------------- ------------- ------------- ------------- -------------
Net increase in shares........... 2,097,883 1,178,028 735,748 1,888,437 1,089,477 1,013,198
------------- ------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- ------------- -------------
AMOUNTS:
Sales............................ $ 78,355,249 $ 117,209,758 $ 59,726,584 $ 77,959,329 $ 20,465,173 $ 21,499,878
Reinvestment of dividends........ 9,810,072 19,185,059 7,553,466 16,813,005 1,596,362 3,460,890
------------- ------------- ------------- ------------- ------------- -------------
88,165,321 136,394,817 67,280,050 94,772,334 22,061,535 24,960,768
Less redemptions................. (59,998,683) (120,988,056) (58,179,301) (71,595,439) (11,039,165) (14,792,509)
------------- ------------- ------------- ------------- ------------- -------------
Net increase..................... $ 28,166,638 $ 15,406,761 $ 9,100,749 $ 23,176,895 $ 11,022,370 $ 10,168,259
------------- ------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- ------------- -------------
Capital stock authorized
(shares)........................ 200,000,000 100,000,000 100,000,000
Par Value........................ $ .01 $ .01 no par
</TABLE>
84
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 4. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES --
<TABLE>
<CAPTION>
COLUMBIA
COLUMBIA COLUMBIA COLUMBIA SPECIAL
COMMON STOCK GROWTH INTERNATIONAL STOCK FUND, INC.
FUND, INC. (CCSF) FUND, INC. (CGF) FUND, INC. (CISF) (CSF)
----------------- --------------------- ------------------- ----------
<S> <C> <C> <C> <C>
Investment management fees incurred..... $2,612,332 $4,205,452 $745,167 $4,985,736
Investment management fee computation
basis (percentage of daily net assets
per annum)............................. 0.60 of 1% 0.75 of 1% to 1% 1% to
$200,000,000 daily $500,000,000
net assets; .625 of daily net
1% between assets;
$200,000,000 and 0.75 of 1%
$500,000,000; and in excess
0.50 of 1% of
in excess of $500,000,000
$500,000,000
Transfer agent fee (included in
shareholder servicing costs)........... $267,543 $515,893 $175,697 $457,790
Fees earned by directors not affiliated
with each Fund's investment advisor,
transfer agent, or Columbia Management
Co..................................... $4,345 $7,800 $743 $5,327
</TABLE>
<TABLE>
<CAPTION>
COLUMBIA COLUMBIA COLUMBIA COLUMBIA
SMALL CAP REAL ESTATE EQUITY BALANCED DAILY INCOME
FUND, INC. (CSCF) FUND, INC. (CREF) FUND, INC. (CBF) COMPANY (CDIC)
----------------- ------------------ ---------------- ---------------------
<S> <C> <C> <C> <C>
Investment management fees incurred..... $598,044 $609,353 $2,201,334 $2,457,758
Investment management fee computation
basis (percentage of daily net assets
per annum)............................. 1% 0.75 of 1% 0.50 of 1% 0.50 of 1% to
$500,000,000 daily
net assets; 0.45 of
1% between
$500,000,000 and
$1,000,000,000; and
0.40 of 1% in excess
of $1,000,000,000
Transfer agent fee (included in
shareholder servicing costs)........... $91,895 $99,500 $301,237 $358,355
Fees earned by directors not affiliated
with each Fund's investment advisor,
transfer agent, or Columbia Management
Co..................................... $623 $791 $4,416 $5,044
Value of investments held at June
30,1998 by:
Columbia Management Co................ $23,537,387
Columbia Funds Management Company..... $12,143,005
</TABLE>
85
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-- 4. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES, CONTINUED --
<TABLE>
<CAPTION>
COLUMBIA U.S. COLUMBIA FIXED COLUMBIA COLUMBIA
GOVERNMENT SECURITIES INCOME SECURITIES MUNICIPAL BOND HIGH YIELD
FUND, INC. (CUSG) FUND, INC. (CFIS) FUND, INC. (CMBF) FUND, INC. (CHYF)
--------------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Investment management fees incurred..... $93,480 $990,783 $1,027,819 $139,977
Investment management fee computation
basis (percentage of daily net assets
per annum)............................. 0.50 of 1% 0.50 of 1% 0.50 of 1% 0.60 of 1%
Transfer agent fee (included in
shareholder servicing costs) $24,350 $137,803 $61,143 $26,532
Fees earned by directors not affiliated
with each Fund's investment advisor,
transfer agent, or Columbia Management
Co..................................... $191 $1,966 $2,016 $241
Value of investments held at June
30,1998 by:
Columbia Management Co................ $1,053,342 $6,629,541
Columbia Funds Management Company..... $249,432 $1,825,017
</TABLE>
The investment advisor of the Funds is Columbia Funds Management Company (CFMC).
The transfer agent for the Funds is Columbia Trust Company (CTC). The transfer
agent is compensated based on a per account fee.
CFMC, CTC and Columbia Management Co. (CMC), an affiliated company, are indirect
wholly owned subsidiaries of Fleet Financial Group, Inc. (Fleet), a publicly
owned multi-bank holding company registered under the Bank Holding Company Act
of 1956. Pursuant to federal banking regulations, no officers or directors of
the Funds are officers or directors of CFMC, CTC or CMC. J. Jerry Inskeep, Jr.,
an officer and director of the Funds, is affiliated with Fleet, but receives no
compensation or other payment from the Funds.
The contracts for investment advisory and transfer agent services must be
renewed annually by a majority vote of the Funds' shareholders or by the
directors of the Funds. At June 30, 1998, CCSF had investments in securities of
U.S. Bancorp, which provides custodial services for the Fund.
86
<PAGE>
NOTES
<PAGE>
MUTUAL FUND SHARES ARE NOT INSURED BY THE FDIC OR ANY OTHER GOVERNMENTAL ENTITY;
ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF, OR GUARANTEED BY, ANY BANK; AND
INVOLVE RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
<PAGE>
[LOGO]
COLUMBIA FUNDS
-- 1301 S.W. FIFTH AVENUE, PORTLAND, OREGON 97201 --
-- DIRECTORS --
---------------------------------
JAMES C. GEORGE
J. JERRY INSKEEP, JR.
THOMAS R. MACKENZIE
RICHARD L. WOOLWORTH
-- INVESTMENT ADVISOR --
---------------------------------
COLUMBIA FUNDS MANAGEMENT COMPANY
1300 S.W. SIXTH AVENUE
PORTLAND, OREGON 97201
-- LEGAL COUNSEL --
---------------------------------
STOEL RIVES LLP
900 S.W. FIFTH AVENUE, SUITE 2300
PORTLAND, OREGON 97204
-- AUDITORS --
---------------------------------
PRICEWATERHOUSECOOPERS LLP
1300 S.W. FIFTH AVENUE, SUITE 3100
PORTLAND, OREGON 97201
-- TRANSFER AGENT --
---------------------------------
COLUMBIA TRUST COMPANY
1301 S.W. FIFTH AVENUE
PORTLAND, OREGON 97201
THIS INFORMATION MUST BE PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS.
THE MANAGERS' VIEWS CONTAINED IN THIS REPORT ARE SUBJECT TO CHANGE AT ANY
TIME, BASED ON MARKET AND OTHER CONSIDERATIONS.
PORTFOLIO CHANGES SHOULD NOT BE CONSIDERED RECOMMENDATIONS FOR ACTION BY
INDIVIDUAL INVESTORS.
FUNDS DISTRIBUTED BY PROVIDENT DISTRIBUTORS, INC.
