<PAGE> 1
- --------------------------------------------------------------------------------
DEAR PARTICIPATION HOLDERS:
We are pleased to report a distribution of $0.12 from net investment income
for the six-month period ended June 30, 1999. There was also a return of capitol
of $0.004. There were no realized capital gains for this period. Thus,
participation holders benefited from the growth in portfolio value with the
added benefit of tax efficiency.
The Trust had a total return of 12.62% for the period compared to a return
of 10.93% for the average growth and income fund monitored by Lipper, Inc. and a
return of 12.39% for the unmanaged Standard & Poor's 500 Stock Price Index (with
dividends reinvested).
Lexington Corporate Leaders Trust Fund was created in 1935 and invests in a
portfolio of blue chip companies. The performance of the portfolio is a
reflection of the industries, companies, and particular portfolio weightings for
each industry. The companies in which the Trust invests have diversified
throughout the years and include many multi-national companies with product
lines that have evolved since the 1930's such as computer technology,
telecommunications, and transportation.
PORTFOLIO REVIEW
Stocks continued to soar in the first half. Driving stock prices higher was
the much-improved outlook for corporate earnings, a reflection of the continued
strength of the U.S. economy and improving conditions in several countries that
are important trading partners of U.S. corporations. The Trust was fully
invested throughout the period.
Shares of AT&T Corp., Citigroup Inc., and Lucent Technologies, Inc received
as a result of stock splits were held by the Trust. Also, Exxon Corp. and Mobil
Corp. announced plans to merge. During the first six months of the year, the
Trust benefited from improved returns for several sectors that under-performed
in 1998. The increase in the price of crude oil resulted in share price
improvement for Chevron Corp., Mobil Corp., Exxon Corp., and Dupont (E.I.) de
Nemours & Co., Inc. (Conoco, Inc.). Dupont, the largest U.S. chemical company,
plans a share exchange offer in the third quarter for the 70% of Conoco that it
still holds. Railroads also recovered from the 18-month industry meltdown that
resulted from the merger of Union Pacific Corp with Southern Pacific. The
performance of portfolio holdings in Union Pacific Corp. and Burlington Northern
Santa Fe reflected the strong industry recovery as railroads began to recapture
market share that had been lost to other modes of delivery including trucks and
barges. Union Pacific, the largest railroad in the U.S. is leading the recovery.
MARKET OUTLOOK
We expect earnings to remain strong for the remainder of the year providing
continued support for stock prices.
The continued growth of the U.S. and overseas economies (global economies)
should be positive for the success of companies held in the portfolio. The Trust
and participation holders continue to benefit from a blue chip stock portfolio
with particular emphasis on consistent investment style, buy and hold strategy,
low expenses, no portfolio turnover, and tax efficiencies which limit
distributions of realized capital gains.
YEAR 2000 COMPLIANCE RISK
The Fund seeks to ensure that the operating and processing systems of the
companies in which it invests will continue to function when the Year 2000
arrives. However, the risk exists that one or more of these companies may not be
adequately prepared for the Year 2000 which could possibly have a material
impact on the company itself and on the Fund's investment in that company.
We appreciate the support of our participation holders and would be happy to
respond to any questions or comments you may have. Please feel free to call us
at 1-800-526-0056 or visit our website at www.lexingtonfunds.com.
Sincerely,
<TABLE>
<S> <C>
/s/ LAWRENCE KANTOR /s/ ROBERT DEMICHELE
LAWRENCE KANTOR ROBERT M. DeMICHELE
Portfolio Manager Chairman of the Board
August, 1999 LEXINGTON MANAGEMENT CORPORATION
August, 1999
</TABLE>
* 10.97%, 21.84% and 15.77% are the one, five and ten year average annual
standard total returns, respectively, for the period ended June 30, 1999.
Investment return and principal value of an investment will fluctuate so that
an investor's participations, when redeemed, may be worth more or less than at
their original cost. Total return represents past performance and is not
predictive of future results. There is no guarantee that the fund can achieve
its objective.
- --------------------------------------------------------------------------------
<PAGE> 2
- --------------------------------------------------------------------------------
PORTFOLIO SUMMARY as of June 30, 1999
<TABLE>
<CAPTION>
DOMESTIC STOCKS FOREIGN STOCKS CASH & CASH EQUIVALENTS
- ----------------- ---------------- -------------------------
<S> <C> <C>
97% 2.00% 1.00%
</TABLE>
<TABLE>
<CAPTION>
CONSUMER CHEMICAL &
OIL INTERNATIONAL PRODUCTS ENERGY COMMUNICATIONS RAILROADS FERTILIZERS
- ------------------- --------- -------- ---------------- ----------- ------------
<S> <C> <C> <C> <C> <C>
18% 15.00% 10.00% 9.00% 8.00% 8.00%
</TABLE>
TOP TEN HOLDINGS (56% OF PORTFOLIO)
<TABLE>
<S> <C>
1. General Electric Co. -- Electrical Equipment 6. AT&T Corp. -- Communications
2. Columbia Energy Group -- Energy 7. Exxon Corp. -- Oil International
3. Mobil Corp. -- Oil International 8. Citigroup Inc. -- Financial
4. Chevron Corp. -- Oil International 9. Burlington Northern Santa Fe -- Railroads
5. Procter & Gamble Co. -- Consumer Products 10. DuPont (E.I.) de Nemours & Co., Inc. -- Chemical & Fertilizers
</TABLE>
2
<PAGE> 3
[COMPANY LOGOS]
- --------------------------------------------------------------------------------
If you had invested $10,000 58 1/2 years ago. . .
ILLUSTRATION OF AN ASSUMED INVESTMENT OF $10,000
WITH INCOME DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
[LOGO] REINVESTED
The table on the following page covers the period from March 16, 1941 to June
30, 1999. This period was one of generally rising common stock prices. The
results shown should not be considered as a representation of the dividends and
other distributions which may be realized from an investment made in the Trust
today. A program of the type illustrated does not assure a profit or protect
against depreciation in declining markets.
Long-term investments in industry, such as Lexington Corporate Leaders Trust
Fund, tend to move with the basic inflationary trend and offer your dollars an
opportunity to grow.
3
<PAGE> 4
LEXINGTON CORPORATE LEADERS TRUST FUND
- --------------------------------------------------------------------------------
Cumulative cost figure represents the initial investment of $10,000 plus the
cumulative amount of dividends reinvested. Dividends and other distributions
were assumed to have been reinvested in additional participations at the
reinvestment price. The value of participations "Initially Acquired" includes
the value of additional participations created as a result of the reinvestment
of that portion of the semi-annual distributions representing "A Return of
Capital" (the proceeds from securities sold representing the cost of securities
sold, and other principal transactions). No adjustment has been made for any
income taxes payable by Holders on dividends or other distributions reinvested
in additional participations.
The dollar amounts of distributions from realized gains (determined at the Trust
level) reinvested in additional participations were: 1941--None; 1942--None;
1943--None; 1944--$3; 1945--$450; 1946--None; 1947--$44; 1948--$338; 1949--None;
1950--$283; 1951--$796; 1952--$185; 1953--$10; 1954--$812; 1955--$474;
1956--$4,347; 1957--$48; 1958--$17; 1959--$3,032; 1960--$2,371; 1961--$2,118;
1962--$2,749; 1963--$735; 1964--$3,138; 1965--$9,035; 1966--$1,077; 1967--$48;
1968--$4,121; 1969--$102; 1970--$644; 1971--$1,862; 1972--$2,300; 1973--None;
1974--None; 1975--None; 1976--$5,071; 1977--$4,161; 1978--None; 1979--None;
1980--$5,182; 1981--$31,473; 1982--None; 1983--$18,602; 1984--$8,258; 1985--
$39,496; 1986--$64,138; 1987--$69,182; 1988--$49,350; 1989--$99,410;
1990--$148,727; 1991--$39,773; 1992--$52,819; 1993--$46,262; 1994--$160,296;
1995--$7,696; 1996--$62,612; 1997--$664,104; 1998--$83,389; 1999--$0;
Total--$1,701,140.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VALUE OF PARTICIPATIONS
Cumulative Cost Purchased Through
Amount of of Participations Cumulative Reinvestment of Purchased
Dividends Purchased Cost Distributions Through
Year Reinvested Through Including from Reinvestment Net
Ended Semi- Reinvestment Reinvested Initially Realized Gains of Dividends Asset
Dec. 31 Annually of Dividends Dividends Acquired (Cumulative) Sub-Total (Cumulative) Value
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1941* -- -- $ 10,000 $ 8,799 -- $ 8,799 -- $ 8,799
1942 -- -- 10,000 9,613 -- 9,613 -- 9,613
1943 $ 190 $ 190 10,190 10,809 -- 10,809 $ 188 10,997
1944 192 382 10,382 11,983 $ 3 11,986 402 12,388
1945 215 597 10,597 14,709 464 15,173 682 15,855
1946 187 784 10,784 13,961 430 14,391 816 15,207
1947 370 1,154 11,154 14,639 447 15,086 1,141 16,227
1948 513 1,668 11,668 14,840 718 15,558 1,480 17,038
1949 509 2,177 12,177 17,113 701 17,814 1,968 19,782
1950 804 2,980 12,980 19,871 994 20,865 2,779 23,644
1951 1,012 3,992 13,992 21,659 1,756 23,415 3,674 27,089
1952 1,054 5,046 15,046 24,356 2,016 26,372 4,901 31,273
1953 1,217 6,263 16,263 24,849 2,030 26,879 6,149 33,028
1954 1,378 7,641 17,641 33,779 3,476 37,255 9,475 46,730
1955 1,599 9,240 19,240 39,164 4,398 43,562 12,349 55,911
1956 1,790 11,030 21,030 38,511 7,051 45,562 10,475 56,037
1957 1,910 12,940 22,940 36,268 6,574 42,842 11,496 54,338
1958 2,134 15,075 25,075 48,925 8,778 57,703 17,710 75,413
1959 2,184 17,258 27,258 55,426 11,821 67,247 19,992 87,239
1960 2,416 19,674 29,674 55,782 12,653 68,435 19,772 88,207
1961 2,697 22,371 32,371 67,126 16,993 84,119 25,757 109,876
1962 2,926 25,296 35,296 62,396 17,033 79,429 24,446 103,875
1963 3,243 28,540 38,540 71,467 19,863 91,330 30,711 122,041
1964 3,553 32,093 42,093 83,001 24,049 107,050 35,865 142,915
1965 3,855 35,948 45,948 92,523 30,246 122,769 35,623 158,392
1966 4,571 40,519 50,519 74,713 24,491 99,204 31,774 130,978
1967 5,060 45,579 55,579 83,121 27,090 110,211 40,165 150,376
1968 5,573 51,153 61,153 89,160 32,157 121,317 46,879 168,196
1969 5,915 57,068 67,068 75,017 26,979 101,996 44,536 146,532
1970 6,009 63,077 73,077 82,621 28,564 111,185 52,500 163,685
1971 6,190 69,267 79,267 93,454 32,126 125,580 61,694 187,274
1972 6,585 75,852 85,852 108,913 38,484 147,397 75,949 223,346
1973 7,371 83,223 93,223 93,151 32,729 125,880 71,868 197,748
1974 8,196 91,419 101,419 68,448 22,864 91,312 57,376 148,688
1975 9,139 100,557 110,557 91,498 30,474 121,972 85,413 207,385
1976 9,666 110,223 120,223 115,461 37,963 153,424 101,306 254,730
1977 11,237 121,460 131,460 108,466 35,919 144,385 96,397 240,782
1978 13,283 134,743 144,743 110,210 34,687 144,897 105,738 250,635
1979 15,804 150,547 160,547 139,110 34,774 173,884 121,307 295,191
1980 19,369 169,916 179,916 173,026 47,488 220,514 165,362 385,876
1981 21,822 191,738 201,738 163,070 62,645 225,715 140,698 366,413
1982 24,452 216,190 226,190 191,554 69,992 261,546 183,359 444,905
1983 25,923 242,114 252,114 235,913 91,870 327,783 218,649 546,432
1984 28,926 271,040 281,040 250,855 91,476 342,331 226,566 568,897
1985 31,808 302,848 312,848 333,623 145,913 479,536 293,217 772,753
1986 39,216 342,064 352,064 408,170 212,840 621,010 342,608 963,618
1987 40,394 382,458 392,458 412,599 241,185 653,784 326,728 980,512
1988 71,268 453,726 463,726 470,438 297,425 767,863 407,155 1,175,018
1989 45,103 498,829 508,829 583,494 438,476 1,021,970 509,512 1,531,482
1990 51,303 550,132 560,132 552,346 473,992 1,026,338 440,810 1,467,148
1991 55,828 605,960 615,960 654,372 558,392 1,212,764 539,190 1,751,954
1992 55,460 661,420 671,420 700,391 619,341 1,319,732 600,946 1,920,678
1993 54,505 715,925 725,925 814,945 727,611 1,542,556 715,658 2,258,214
1994 60,332 776,257 786,257 832,095 759,684 1,591,779 649,069 2,240,848
1995 61,329 837,586 847,586 1,207,794 998,228 2,206,022 913,513 3,119,535
1996 64,546 902,132 912,132 1,452,214 1,232,426 2,684,640 1,134,598 3,819,238
1997 71,379 973,511 983,511 1,794,519 1,785,369 3,579,888 1,121,302 4,701,190
1998 72,385 1,045,896 1,055,896 1,948,610 1,965,327 3,913,937 1,254,684 5,168,621
June 30
1999 38,775 1,084,671 1,094,671 2,180,810 2,198,162 4,378,972 1,442,103 5,821,075
<CAPTION>
Number
Year of
Ended Partici-
Dec. 31 pations
- --------------------------
<S> <C>
1941* 566
1942 584
1943 601
1944 620
1945 693
1946 716
1947 824
1948 989
1949 1,176
1950 1,392
1951 1,652
1952 1,845
1953 1,945
1954 2,117
1955 2,243
1956 3,123
1957 3,269
1958 3,406
1959 3,906
1960 4,562
1961 4,881
1962 5,541
1963 5,803
1964 6,452
1965 8,066
1966 8,606
1967 8,948
1968 9,710
1969 10,115
1970 10,957
1971 11,856
1972 12,605
1973 13,123
1974 14,124
1975 14,781
1976 16,914
1977 18,898
1978 20,370
1979 23,931
1980 26,181
1981 33,836
1982 36,772
1983 42,757
1984 49,375
1985 58,251
1986 69,711
1987 83,847
1988 97,918
1989 111,950
1990 139,330
1991 152,079
1992 165,291
1993 176,699
1994 213,211
1995 227,040
1996 237,959
1997 315,940
1998 329,211
1999 331,496
</TABLE>
- --------------------------------------------------------------------------------
* From March 16, 1941.
Note--During 1990 all sales charges were eliminated. The above table reflects
the change to a "No Load" status as if it were in effect for the entire period
shown. The amounts shown as dividends for periods after October 31, 1988 include
interest income from the investment of amounts deposited in the distributive
fund.
4
<PAGE> 5
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES June 30, 1999
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investments at market quotations, common stocks
(identified cost $345,488,339)............................ $481,794,253
Cash........................................................ 5,740,526
Subscriptions receivable.................................... 290,806
Receivable for accrued dividends............................ 568,733
------------
Total assets................................. 488,394,318
------------
LIABILITIES
Distribution payable........................................ 428,168
Payable for participations redeemed......................... 539,045
Accrued expenses............................................ 159,391
------------
Total liabilities............................ 1,126,604
------------
NET ASSETS
Balance applicable to 27,742,214 participations outstanding
(Note 6).................................................. $487,267,714
============
Computation of public offering price:
Net asset value, offering and redemption price per
participation (net assets divided by participations
outstanding)........................................... $ 17.56
============
</TABLE>
See Notes to Financial Statements
- --------------------------------------------------------------------------------
5
<PAGE> 6
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS June 30, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number of Market
Securities Shares Cost Value
- ------------------------------------------------------------ --------- ------------ ------------
<S> <C> <C> <C>
CONSUMER PRODUCTS: (14.5%)
Eastman Kodak Co. .......................................... 312,800 $ 21,713,618 $ 21,192,200
Fortune Brands, Inc. ....................................... 312,800 9,776,477 12,942,100
Gallaher Group PLC.......................................... 312,800 5,520,074 7,644,050
Procter & Gamble Co. ....................................... 312,800 20,986,027 27,917,400
------------ ------------
57,996,196 69,695,750
------------ ------------
OIL INTERNATIONAL: (17.6%)
Chevron Corp. .............................................. 312,800 19,923,858 29,774,650
Exxon Corp. ................................................ 312,800 16,367,478 24,124,700
Mobil Corp. ................................................ 312,800 20,388,463 30,967,200
------------ ------------
56,679,799 84,866,550
------------ ------------
CHEMICAL & FERTILIZERS: (7.6%)
DuPont (E.I.) de Nemours & Co., Inc. ....................... 312,800 16,540,276 21,368,150
Union Carbide Corp. ........................................ 312,800 13,202,855 15,249,000
------------ ------------
29,743,131 36,617,150
------------ ------------
ELECTRICAL EQUIPMENT: (7.3%)
General Electric Co. ....................................... 312,800 17,582,710 35,346,400
------------ ------------
BROADCASTING: (2.8%)
CBS Corp. (formerly Westinghouse Electric Corp.)............ 312,800 6,484,043 13,587,250
------------ ------------
RETAILING: (3.6%)
Sears, Roebuck & Co. ....................................... 312,800 14,022,334 13,939,150
Venator Group, Inc. (formerly Woolworth, Corp.)*............ 312,800 6,095,111 3,264,850
------------ ------------
20,117,445 17,204,000
------------ ------------
UTILITIES: (7.5%)
Ameren Corp. (formerly Union Electric Co.).................. 312,800 12,184,318 12,003,700
Consolidated Edison, Inc. (formerly Consolidated Edison Co.,
of NY, Inc.).............................................. 312,800 10,084,435 14,154,200
Pacific Gas & Electric Co. ................................. 312,800 8,208,524 10,166,000
------------ ------------
30,477,277 36,323,900
------------ ------------
RAILROADS: (8.3%)
Burlington Northern Santa Fe................................ 700,542 20,605,031 21,716,802
Union Pacific Corp. ........................................ 312,800 16,946,741 18,240,150
------------ ------------
37,551,772 39,956,952
------------ ------------
ENERGY: (9.6%)
Columbia Energy Group....................................... 501,050 17,731,563 31,409,572
Union Pacific Resources Group, Inc. ........................ 271,567 6,767,771 4,429,937
USX Marathon Group.......................................... 312,800 7,871,574 10,185,550
------------ ------------
32,370,908 46,025,059
------------ ------------
MISC. INDUSTRIAL: (7.3%)
Allied Signal Corp. ........................................ 312,800 12,242,849 19,706,400
Praxair, Inc. .............................................. 312,800 12,868,168 15,307,650
------------ ------------
25,111,017 35,014,050
------------ ------------
COMMUNICATIONS: (9.3%)
AT&T Corp. ................................................. 471,700 13,309,788 26,326,756
Lucent Technologies, Inc. .................................. 274,620 6,300,893 18,519,686
------------ ------------
19,610,681 44,846,442
------------ ------------
FINANCIAL: (4.6%)
Citigroup Inc............................................... 469,700 11,763,360 22,310,750
------------ ------------
Total Investments (100%).......................... $345,488,339 $481,794,253
============ ============
</TABLE>
* Non Income producing
See Notes to Financial Statements
- --------------------------------------------------------------------------------
6
<PAGE> 7
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS Six Months Ended June 30, 1999
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Investment Income:
Income:
Dividends (Net of $47,589 tax expense)................. $ 4,755,915
Interest............................................... 27,691
-----------
Total income......................................... 4,783,606
-----------
Expenses:
Sponsor's administrative fee (Note 4).................. 936,588
Professional fees...................................... 46,475
Trustee's fee (Note 4)................................. 5,000
Custody fees and other services (Note 4)............... 73,428
Transfer agent fees.................................... 286,849
Printing, mailing and sundry........................... 48,065
Registration and filing fees........................... 22,976
-----------
Total expenses....................................... 1,419,381
-----------
Net investment income............................. 3,364,225
-----------
Realized and Unrealized Gain on Investments:
Net realized gain from securities transactions............ 22,021,556
Unrealized appreciation of investments
for the period......................................... 30,033,083
-----------
Net gain on investments........................... 52,054,639
-----------
Net increase in net assets from operations............. $55,418,864
===========
</TABLE>
See Notes to Financial Statements
- --------------------------------------------------------------------------------
7
<PAGE> 8
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended Year Ended
June 30, December 31,
1999 1997
------------ ------------
<S> <C> <C>
Income and Distributable Fund:
Additions:
Net investment income................................ $ 3,364,225 $ 7,463,661
Realized gains from sale of securities,
other than sale of stock units.................... -- 8,884,899
------------ ------------
3,364,225 16,348,560
------------ ------------
Deductions:
Paid on account of participations redeemed........... 272,430 648,862
Semi-annual distributions (Note 3(a))
Paid in cash................................. 413,595 1,783,831
Reinvested, below............................ 2,834,149 13,985,638
------------ ------------
3,520,174 16,418,331
------------ ------------
Net change in income and distributable fund............ (155,949) (69,771)
------------ ------------
Principal Account:
Additions:
Payments received on sale of participations.......... 24,906,752 73,930,270
Semi-annual distributions reinvested, above.......... 2,834,149 13,985,638
Realized gains on sale of stock units................ 22,021,556 45,931,415
Unrealized (appreciation) depreciation of
investments......................................... 30,033,083 (13,378,650)
------------ ------------
79,795,540 120,468,673
------------ ------------
Deductions:
Paid on account of participations redeemed........... 77,552,027 160,221,771
Semi-annual distributions of principal (Note 3(b))... 14,367 651,211
------------ ------------
77,566,394 160,872,982
------------ ------------
Net change in principal account...................... 2,229,146 (40,404,309)
------------ ------------
Net assets at beginning of period:
Income and distributable fund............................... 597,016 666,787
Principal account........................................... 484,597,501 525,001,810
------------ ------------
485,194,517 525,668,597
------------ ------------
Net assets at end of period:
Income and distributable fund............................... 441,067 597,016
Principal account........................................... 486,826,647 484,597,501
------------ ------------
$487,267,714 $485,194,517
============ ============
</TABLE>
See Notes to Financial Statements
- --------------------------------------------------------------------------------
8
<PAGE> 9
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
NOTE 1. NATURE OF BUSINESS AND BASIS OF PRESENTATION
Lexington Corporate Leaders Trust Fund (the "Trust") is an unincorporated
Unit Investment Trust registered as such with the Securities and Exchange
Commission. The Trust commenced operations in 1941 as a series of Corporate
Leaders Trust Fund which was created under a Trust Indenture dated November 18,
1935.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Trust in the preparation of its financial statements:
(a) Valuation of securities--Investments are stated at value based on the
last sale price on the principal exchange on which the security is traded prior
to the time the Trust's assets are valued. Investments for which no sale is
reported, or which are traded over-the-counter, are valued at the mean between
bid and asked prices. Short term securities with 60 days or less to maturity are
valued at amortized cost.
(b) Income taxes--No provision for Federal income taxes is made since the
Trust, under applicable provisions of the Internal Revenue Code, is a Grantor
Trust and all its income is taxable to the Holders of participations.
(c) Other--Investment transactions are recorded on the trade date basis.
Dividend income is recorded on the ex-dividend date. Interest income is accrued
as earned.
(d) Accounting estimates--The preparation of 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 at the date of the financial statements and the amounts of income
and expense during the reporting period. Actual results could differ from those
estimates.
NOTE 3. DISTRIBUTIONS
(a) During the six months ended June 30, 1999 the distributions from net
investment income were $0.11778.
(b) The amount shown does not reflect the reinvestment, if any, of that
portion from the sale of securities (other than stock units) representing the
cost of the securities sold which is distributed and then reinvested in
additional participations. In addition, any gain on the sale of stock units to
provide funds for the redemption of participations is non-distributable and
remains a part of the principal account. During the six months ended June 30,
1999, the distributions from return of capital were $0.00409 per participation.
Effective June 1, 1998, the Trust amended its Trust indenture requiring that
additional shares of common stock received as a result of a stock split shall
remain assets of the Trust.
NOTE 4. TRUSTEE AND SPONSOR FEES
State Street Bank and Trust Company (the "Trustee") receives an annual
Trustee fee, as well as fees for acting as custodian and for providing portfolio
accounting and record keeping services, which aggregated $78,428 for the six
months ended June 30, 1999. The Trust pays an administrative fee to Lexington
Management Corporation (Sponsor) equal, on an annual basis, to 0.40% of the
average daily net assets of the Trust.
NOTE 5. INVESTMENT TRANSACTIONS
During the six months ended June 30, 1999, the proceeds of sales of
investment securities, other than short-term obligations, were $52,565,816.
There were no purchases of securities during the period.
The cost of investment securities as well as realized security gains and
losses are based on the identified cost basis. The cost of investments for
Federal income taxes is the same as that reported in the Trust's financial
statements.
As of June 30, 1999, net unrealized appreciation of portfolio securities was
$136,305,914, comprised of unrealized appreciation of $142,259,229 and
unrealized depreciation of $5,953,315.
NOTE 6. SOURCE OF NET ASSETS
As of June 30, 1999, the Trust's net assets were comprised of the following
amounts:
<TABLE>
<S> <C>
Net amounts paid in and reinvested by Holders net of
terminations and return of capital payments............... $225,783,886
Cumulative amount of non-distributable realized gains
retained in Principal Account............................. 124,736,847
Unrealized appreciation in value of securities.............. 136,305,914
------------
Principal account....................................... 486,826,647
Income and distributable fund........................... 441,067
------------
Total net assets..................................... $487,267,714
============
</TABLE>
- --------------------------------------------------------------------------------
9
<PAGE> 10
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
NOTE 7. PARTICIPATIONS ISSUED AND REDEEMED
During the periods indicated, participations were issued and redeemed as
follows:
<TABLE>
<CAPTION>
Number of Participations
----------------------------------------
Six Months Ended Year Ended
June 30, 1999 December 31, 1998
---------------- -----------------
<S> <C> <C>
Issued on payments from Holders.................... 1,490,004 4,778,866
Issued on reinvestment of dividends and
distributions.................................... 167,299 1,198,055
Redeemed........................................... (4,819,615) (10,403,573)
---------- -----------
Net increase (decrease)........................ (3,162,312) (4,426,652)
========== ===========
</TABLE>
NOTE 8. SELECTED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Six Months
Ended Years Ended December 31,
Selected Data Per Participation June 30, ----------------------------------------------------------------
outstanding throughout the period: 1999 1998 1997 1996 1995 1994
---------------------------------- ---------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period............................ $ 15.70 $ 14.88 $ 16.05 $ 13.74 $ 10.51 $ 12.78
-------- -------- -------- -------- -------- --------
Income from investment operations:
Net investment income............. 0.12 0.23 0.27 0.28 0.28 0.31
Net realized and unrealized gain
(loss) on investments........... 1.88 1.28 3.45 2.79 3.82 (0.45)
-------- -------- -------- -------- -------- --------
Total from investment operations.... 2.00 1.51 3.72 3.07 4.10 (0.14)
-------- -------- -------- -------- -------- --------
Less distributions:
Dividends from net investment
income.......................... (0.12) (0.23) (0.28) (0.28) (0.28) (0.32)
Distributions from net realized
gains........................... -- (0.26) (2.60) (0.28) (0.03) (0.90)
Distributions from income and
realized gains included in
terminations.................... (0.01) (0.02) (0.11) (0.02) (0.02) (0.01)
Distributions from capital........ (0.01) (0.18) (1.90) (0.18) (0.54) (0.90)
-------- -------- -------- -------- -------- --------
Total distributions............. (0.14) (0.69) (4.89) (0.76) (0.87) (2.13)
-------- -------- -------- -------- -------- --------
Change in net asset value for the
period............................ 1.86 0.82 (1.17) 2.31 3.23 (2.27)
-------- -------- -------- -------- -------- --------
Net asset value at end of period.... $ 17.56 $ 15.70 $ 14.88 $ 16.05 $ 13.74 $ 10.51
======== ======== ======== ======== ======== ========
Total return........................ 25.46%* 9.94% 23.09% 22.43% 39.21% (0.77)%
Ratios/Supplemental Data:
Net Assets, end of period (000)..... $487,268 $485,195 $525,669 $392,295 $256,467 $156,286
Ratios to average net asset of:
Expenses.......................... 0.61%* 0.65% 0.62% 0.63% 0.58% 0.62%
Net investment income............. 1.44%* 1.46% 1.76% 2.05% 2.57% 2.84%
</TABLE>
* annualized
- --------------------------------------------------------------------------------
10
<PAGE> 11
- --------------------------------------------------------------------------------
INDEPENDENT AUDITOR'S REPORT
- --------------------------------------------------------------------------------
To the Participation Holders of
Lexington Corporate Leaders Trust Fund
We have audited the accompanying statement of assets and liabilities,
including the statement of investments of Lexington Corporate Leaders Trust Fund
as of June 30, 1999, and the related statements of operations, changes in net
assets and the selected financial information for the periods indicated in the
accompanying financial statements. These financial statements and selected
financial information are the responsibility of the management of the Trust. Our
responsibility is to express an opinion on these financial statements and
selected financial information based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and selected
financial information are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of June 30, 1999, by correspondence with State Street Bank and Trust
Company, Trustee. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and selected financial information
referred to above present fairly, in all material respects, the financial
position of Lexington Corporate Leaders Trust Fund as of June 30, 1999, and the
results of its operations, the changes in its net assets and the selected
financial information for the periods indicated, in conformity with generally
accepted accounting principles.
/s/ MCGLADREY & PULLEN
New York, New York
July 8, 1999
- --------------------------------------------------------------------------------
11
<PAGE> 12
Trustee
- ---------------------------------------------------------
STATE STREET BANK AND TRUST COMPANY
225 Franklin Street
Boston, Massachusetts 02110
Auditors
- ---------------------------------------------------------
MCGLADREY & PULLEN, LLP
555 Fifth Avenue
New York, New York 10017
Sponsor
- ---------------------------------------------------------
LEXINGTON MANAGEMENT CORPORATION
P.O. Box 1515
Park 80 West Plaza Two
Saddle Brook, New Jersey 07663
ALL SHAREHOLDER REQUESTS FOR SERVICES OF
ANY KIND SHOULD BE SENT TO:
Transfer Agent
---------------------------------------------------------
STATE STREET BANK AND
TRUST COMPANY
c/o National Financial Data Services
330 West 9th Street
Kansas City, Missouri 64105
OR CALL TOLL FREE:
SERVICE AND SALES: 1-800-526-0056
24 HOUR ACCOUNT INFORMATION:
1-800-526-0052
WWW.LEXINGTONFUNDS.COM
- ---------------------------------------------------------
(800) 526-0052
"LEXLINE"
24 hour toll-free telephone access to your
Lexington Fund account
Price/Yield - Account Balances - Exchanges -
Last Transactions - Total Return -
Duplicate Statements
- ---------------------------------------------------------
This report has been prepared for the information of the Participation
Holders of Lexington Corporate Leaders Trust Fund and is authorized for
distribution to the public only if it is accompanied or preceded by a
currently effective prospectus which sets forth expenses and other
material information.
LEXINGTON
CORPORATE
LEADERS
TRUST
FUND, INC.
---------------------------------------
Seeks long-term growth of capital and
income. Portfolio assets are invested in an
equal number of shares of an established list
of American "blue chip" corporations.
---------------------------------------
SEMI-ANNUAL REPORT
JUNE 30, 1999
The Lexington Group
of NO-LOAD
Investment Companies
[LEXINGTON LOGO]
