TABLE OF CONTENTS
Our Message to You 1
Portfolio Manager's Commentary and Schedule of Investments
Janus Fund 3
Janus Balanced Fund 7
Janus Enterprise Fund 10
Janus Growth and Income Fund 13
Janus Mercury Fund 16
Janus Overseas Fund 20
Janus Twenty Fund 24
Janus Venture Fund 27
Janus Worldwide Fund 32
Statements of Operations 36
Statements of Assets and Liabilities 36
Statements of Changes in Net Assets 38
Financial Highlights 40
Notes to Schedule of Investments 42
Notes to Financial Statements 43
Report of Independent Accountants 45
PERFORMANCE INFORMATION
The following pages include performance overview graphs that compare the
performance of a $10,000 investment in each fund, since its inception, to one or
more widely used market indexes. Each graph reflects the life-time performance
of the fund through October 31, 1995.
When comparing the performance of a fund to an index, keep in mind that
market indexes do not take into account brokerage commissions that would be
incurred if you purchased the individual securities in the index. They also do
not include taxes payable on dividends, interest payments, or operating expenses
necessary to maintain a portfolio investing in the index.
Average annual total returns are quoted for each fund. Average annual total
return is calculated by taking the growth or decline in value of an investment
over a period of time, including reinvestment of dividends and distributions,
and then calculating the annual compound percentage rate that would have
produced the same result had the rate of growth been constant throughout the
period.
AN EXPLANATION OF THE SCHEDULE OF INVESTMENTS
Following the Performance Overview is each fund's Schedule of Investments.
This schedule reports the industry concentrations and the different types of
securities held in the fund's portfolio on the last day of the reporting period.
Securities are usually listed by type (common stocks, corporate bonds, U.S.
government obligations, etc.) and by industry classification (banking,
communications, insurance, etc.).
The market value of each security represents its value on the last day of
the reporting period. The value of securities denominated in foreign currencies
are converted into U.S. dollars. Funds that invest primarily in foreign
securities also provide a summary of investments by country. This summary
reports the fund's exposure to different countries by indicating the percentage
of securities invested in each country.
AN EXPLANATION OF THE FORWARD FOREIGN CURRENCY CONTRACT TABLE
A table listing forward foreign currency contracts follows each fund's
Schedule of Investments (if applicable). Forward foreign currency contracts are
agreements to deliver or receive a preset amount of currency at a future date.
Foreign currency contracts are used to hedge against foreign currency risk in
the fund's long-term holdings.
The table provides the name of the foreign currency, the settlement date of
the contract, the amount of the contract, the value of the currency in U.S.
dollars, and the amount of unrealized gain or loss. The amount of unrealized
gain or loss reflects the change in currency exchange rates from the time the
contract was opened to the last day of the reporting period.
Janus Funds October 31, 1995 Annual Report
<PAGE>
OUR MESSAGE TO YOU
Dear Shareholders:
The rally in U.S. financial markets was equally robust in both stocks and
bonds during our fiscal year ended October 31. Starting in January, economic
growth turned moderate, inflation remained low, and interest rates declined.
Declining interest rates and record corporate profits were the twin engines that
drove stock indexes to record heights. The Standard & Poor's 500 Stock Index
(the S&P 500 Index), which is made up of the stocks of larger companies,
produced a total return of 26.44% for the twelve-month period. By historical
standards, the rally was a steady one. The S&P 500 Index hit 64 new highs during
the twelve months. Smaller stocks appreciated too. The Russell 2000 Index gained
18.35%. Not bad, but still not good enough to catch either the S&P 500 Index, or
the NASDAQ Composite, which charged ahead 33.26%, powered by its large
technology component.
Bonds Performed Well Too. Although the Federal Reserve lowered short-term
rates only once, in July, intermediate and long-term bonds, which are market
driven, turned in impressive results. The benchmark 30-year Treasury Bond had a
total return (with interest reinvested) of 27.9% as its yield fell from 7.97% to
6.33% at fiscal year end. The Federal Reserve's go-slow approach to lowering
short rates caused the gap between the short and long end of the market to
compress. On October 31, a one-year Treasury Bill was yielding 5.55%, just 78
basis points (0.78%) less than the 30-year Treasury Bond.
Foreign Markets Lagged. With few exceptions, foreign markets continued to
lag the U.S. during the year. Measured in U.S. dollars, the Morgan Stanley EAFE
Index (EAFE stands for Europe, Australasia, and the Far East) lost 0.37%, with
net dividends reinvested.* The U.S. market is not represented in EAFE.
ECONOMIC TRENDS
The Economy Landed Softly. The economy slowed sufficiently to avoid higher
inflation but not enough to cause a recession. It is still uncertain whether the
current soft landing is an exception to the typical business cycle or the
beginning of a new trend. Usually an economic boom brings increasing inflation,
and interest rates must rise to choke off growth. If we are indeed seeing a new
cyclical trend - one that does not include recession quite as often - we can
thank technology and the additional flexibility it has brought to the
marketplace. Leaner, more streamlined operations allow business to absorb costs
and adjust quickly to consumer demand, while global competition in labor and
manufacturing hold down prices.
Inflation Was Subdued. In the month of September, unit labor costs (the
cost of labor embedded in each individual product) was unchanged compared to
September 1994. This is the first time in 30 years unit labor costs have not
risen from the previous year. More efficient production and international
competition have kept the lid on labor costs, which, along with the cost of raw
materials, have been the driving forces behind inflation in past cycles. But
during the recent recovery, cost increases did not reach either the wholesale or
retail buyer.
The Mid-Year Rise in Inventories. In 1994, Gross Domestic Product (GDP) was
a robust 4.1%, and then slowed to an annual rate of 2.8% and 1.3% in the first
and second calendar quarters of 1995. This was well within the 2%-3% range that
is sustainable without higher inflation in mature economies such as the U.S. Why
did growth slow? One reason was that the higher interest rates of 1994 had
finally taken hold. As growth slowed, inventories accumulated. Due to the
increased flexibility in corporate America excess inventory was worked off
relatively fast and by the third quarter of 1995 annualized GDP growth jumped to
4.2%. But even as this data was released in late October, retail demand had
turned sluggish and demand was also waning in the manufacturing sector. The
price of industrial commodities (fuel, copper, steel, etc.) had gone into
decline. Clearly, the economy was bouncing around, but business was able to
adjust and overall growth remained moderate.
The Dollar Gathered Strength. The decline in the U.S. dollar against other
major currencies, principally the Japanese yen and the German mark, ended
earlier this year. The dollar's strength was good news for the financial
markets. A stronger dollar reduces the possibility of inflation and means more
buying power for the U.S. consumer because imported goods are less expensive. A
weak dollar makes foreign goods more expensive, and can eventually fuel
inflation.
The Budget Debate. The budget debate in Washington and the current push for
fiscal responsibility is another factor supporting the performance of financial
markets. Congress' focus on curbing the deficit has helped support bond prices
this year, which in turn have buoyed stocks. A responsible budget agreement
would very likely have a positive impact on both markets.
- -----------------------------------------
*Net dividends are those dividends that remain to be reinvested after foreign
tax obligations have been met. Tax obligations vary from country to country.
Janus Funds October 31, 1995 Annual Report
1
<PAGE>
OUR MESSAGE TO YOU
EQUITY MARKETS
Strong Market Sectors. This year the market favored growth stocks, which
benefit from moderate economic growth, and punished cyclical stocks, which are
more dependent on strong numbers from the general economy to boost their bottom
lines. Technology was again a market leader, with semiconductors, chip
manufacturers, and software vendors ahead of the field. Drugs performed well, as
did financial companies, which were helped by falling interest rates, greater
efficiency, and, in the banking industry, ongoing consolidation of both regional
and central banks. The demand for cellular equipment and services, which has
benefited from technological advances, is very strong globally, and has led to
excellent performance in a range of telecommunications stocks. Other groups that
performed well included aerospace and defense, which have been consolidating and
benefiting from increased Congressional spending. Strong loan demand helped
consumer finance stocks, and beverages are experiencing growth in overseas
sales.
Weak Sectors. Retailers, oil, and container manufacturers were in a slump
this year. Retailers and oil companies have little pricing power. Container
manufacturers, on the other hand, have been hurt by high aluminum prices.
INTERNATIONAL MARKETS
Europe Was Strong. The UK, Sweden, Germany, Finland, and the Netherlands,
where our funds have significant investments, gained this year, and several
markets set new records. The stronger dollar was both good news and bad news in
Europe: good news for economic growth, which has been largely export driven the
last two years (a strong dollar made U.S. goods more expensive abroad); bad news
for investors who did not hedge currencies. Economic growth has slowed on the
Continent, but interest rates have been slower to respond to that weakness. Many
of the same industries that are doing well in the U.S. are performing well
overseas. Aerospace, data processing, electrical and electronic equipment,
health care, and business and financial services have all posted exceptional
results.
Japan and the Far East. The Far East lagged the U.S. this year. The
Japanese recession reduced demand for regional products and a number of regional
economies had to raise interest rates in an effort to put the inflation genie
back in the bottle. The strong U.S. dollar also eroded returns for foreign
investors.
Latin America. With few exceptions, Latin American markets have continued
to struggle under the cloud of Mexican economic recession and currency
depreciation.
HOW OUR FUNDS PERFORMED
On the whole, funds in the Janus family produced very solid results for the
fiscal year, despite our overall moderate exposure to the volatile technology
sector and our conservative strategy in the last few months of 1994, when
economic growth was very robust and there was a troubling divergence between the
stock and bond markets. This year Janus Overseas Fund was the star of the group.
Lipper Analytical Services, Inc., the large mutual fund rating service, ranked
Janus Overseas second out of the 233 funds in its International Group. Janus
Growth and Income Fund was ranked 71st out of 408 (top 17%) in the Growth and
Income category, and Janus Worldwide Fund had top quartile performance, ranking
28th out of 120 funds in Lipper's Global Fund Group. All rankings are for the
one-year period ended October 31, 1995.(1)
JANUS OLYMPUS FUND
Janus Olympus Fund will open December 29, 1995. The Fund is a
nondiviersified growth fund and will be managed by Scott Schoelzel. Scott has
been with Janus since early 1994 and has helped Tom Marsico with both the Janus
Twenty and Janus Growth and Income Funds. Scott has also managed separate
institutional accounts and has done an excellent job with all his portfolio
responsibilities. Janus Olympus Fund will afford Scott the flexibility to invest
in a wide variety of companies, both small and large, domestic and foreign. We
believe the Fund will be a very attractive investment for shareholders seeking
growth of capital over a broad universe of securities.(2)
JANUS TWENTY FUND HAS REOPENED TO NEW INVESTORS
On November 1, 1995, Janus Twenty Fund reopened to new investors. Since the
Fund closed in January 1993, financial markets worldwide have experienced
tremendous growth and there are now many new and exciting companies that meet
Janus Twenty Fund's objectives. Reopening the Fund will allow portfolio manager
Tom Marsico to take advantage of these opportunities.(2)
We appreciate your investment with Janus.
/s/ Thomas H. Bailey
Thomas H. Bailey
Chairman
- ----------------------------
(1) Past performance is no guarantee of future results. Lipper rankings are
based on total return, including reinvestment of dividends and capital
gains.
(2) For a prospectus containing more complete information, including expenses,
please call a Janus Investor Service Representative at 1-800-525-3713. Read
the prospectus carefully before you invest or send money.
Janus Funds October 31, 1995 Annual Report
2
<PAGE>
JANUS FUND Portfolio Manager, James P. Craig
PERFORMANCE REVIEW
Janus Fund produced a total return of 21.62% for the fiscal year ended
October 31, 1995, while the broader market, as measured by the S&P 500 Index,
gained 26.44%. Both returns include reinvested dividends.
Much of the Fund's underperformance occurred early in the year when we
adopted a more cautious strategy due to rapid growth in the economy and the
threat that interest rates might rise. In addition, our modest exposure to
technology constrained results. We underestimated the demand for personal
computers and overestimated industry capacity. We believed prices would fall if
supply outstripped demand. Demand for PCs, software, and semiconductors remained
strong, however, and we missed growth opportunities in several individual
technology companies. Most European markets also appreciated less than the U.S.
market and this impacted some of our foreign holdings. Lastly, earnings
disappointments at Wal-Mart and container manufacturer Crown Cork & Seal hurt
results.
Once the Fund assumed a less conservative posture, performance was in line
with the S&P 500 Index, despite only a moderate exposure to technology, which
was the best performing market sector again this year. We also stayed the course
with Citicorp. When the Mexican peso was devalued, and Latin America suffered a
fiscal crisis, it appeared Citicorp's earnings momentum might stall. But
Citicorp's stock recovered quickly, and went on to appreciate. Finally, we
recognized early the boom in outsourcing, and its effect on EDS and First Data,
and the potential of German software provider SAP, all of which contributed to
Fund performance.
THE PORTFOLIO
Equity holdings increased from 78.3% when the fiscal year began to 90.5% at
year end. This is a very high percentage for Janus Fund, and reflects a positive
perspective on equities, especially on growth stocks, which tend to perform best
in a moderately expanding economy.
The Fund's ten largest holdings were 34.6% of the portfolio at year end, up
from 25.3% at the end of October 1994, and 30.7% at the end of April.
Approximately 19.0% of the portfolio was invested abroad, compared to 11.6% at
year end 1994.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
First Data Corp. 5.0% 2.5%
General Motors E (EDS) 4.8% 1.7%
Citicorp 4.0% 3.8%
Roche Holdings 3.6% 0.2%
SAP AG 3.6% 0.5%
Pfizer 3.3% 2.4%
Wolters Kluwer 2.6% 2.8%
UNUM 2.6% 2.0%
General Re 2.6% 1.2%
Astra 2.5% 2.1%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Computer Software and Services 14.7% 4.7%
Pharmaceuticals 12.3% 7.0%
Financial - Bank Money Center 6.6% 6.3%
Forest Products and Paper 5.7% 0.2%
Insurance-Property and Casualty 4.1% 2.2%
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Pharmaceuticals. Pfizer and Merck in the U.S., and Astra and Roche in
Europe have breakthrough products in their pipelines. We expect these companies
to increase revenues by 15% annually for the next 3 years, while earnings should
grow by 20%.
Outsourcing. It is becoming standard business practice to farm out
functions such as data processing and computer operations. EDS (General Motors
E) is a data processing and information management company that is being spun
off by GM. EDS should sign $10 billion in new business this year and compete for
$30 billion in new contracts over the next 18 months. The company's backlog is
$36 billion. First Data processes credit card transactions for banks and
recently acquired First Financial Management, the largest credit card processor
for merchants. First Data now dominates a market growing at better than 20%
annually.
Banking. Increased efficiency and disciplined asset growth are the keys to
earnings momentum at Citicorp, which also has very successful operations in
emerging markets, and at Bank of New York, where emphasis on securities
processing is lifting profits.
Paper. The industry is restructuring and demand is in an extended upcycle
with exceptional profitability. Instead of adding new plants, Georgia-Pacific,
Champion International, and James River are cleaning up their balance sheets and
repurchasing stock.
Insurance. The most interesting of the insurance companies have
restructured operations, increased efficiency, and grown market share. This
group includes UNUM, a disability provider, reinsurer General Re, and
property-casualty giant AIG.
Share Repurchase. Many companies have excess cash flow, more money than
they can prudently reinvest in their business. Some companies are employing the
extra cash to buy back and retire their own stock. Stock repurchase programs
increase earnings per share, which in turn can push up the price of the stock,
thus adding value for shareholders. Citicorp (banking), Hercules (chemicals),
Hershey (foods), Champion International and Georgia-Pacific (paper) have
significant stock repurchase programs.
GOING FORWARD
Current economic conditions are very positive for growth stocks. As long as
economic expansion is moderate and inflation remains low, we expect to find good
investment opportunities in the coming year.
Thank you for your investment in Janus Fund.
Janus Funds October 31, 1995 Annual Report
3
<PAGE>
JANUS FUND Portfolio Manager, James P. Craig
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Fund and the S&P 500 Index. Janus Fund is represented by a solid green
line. The S&P 500 Index is represented by a single dashed black line. The "y"
axis reflects the value of the investment. The "x" axis reflects the computation
periods from inception, February 5, 1970, through October 31, 1995. The upper
right quadrant reflects the ending value of the hypothetical investment in Janus
Fund ($511,542) as compared to the S&P 500 Index ($186,028). There is a legend
in the upper left quadrant of the graph which indicates Janus Fund's one-year,
five-year, ten-year and since inception (February 5, 1970) average annual total
returns as 21.62%, 17.27%, 15.98% and 16.51%, respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the index.
The index is unmanaged.
- --------------------------------------------------------------------------------
JANUS FUND October 31, 1995
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 86.8%
Aerospace and Defense - 3.1%
1,466,600 Boeing Co. $ 96,245,625
542,825 Lockheed Martin Corp. 36,979,953
400,000 Loral Corp. 11,850,000
1,015,625 McDonnell Douglas Corp. 83,027,344
1,632,600 United Technologies Corp. 144,893,250
372,996,172
Auto and Truck - 0.6%
831,000 Chrysler Corp. 42,900,375
947,000 Ford Motor Co. 27,226,250
70,126,625
Biopharmaceuticals - 0.3%
744,225 Amgen, Inc.* 35,722,800
Broadcasting, Radio and Television - 1.1%
172,832 Viacom, Inc. - Class A* 8,598,392
2,427,813 Viacom, Inc. - Class B* 121,390,650
129,989,042
Chemicals - 2.4%
354,500 Cytec Industries, Inc. * 19,408,875
5,080,125 Hercules, Inc. 271,151,672
290,560,547
Commercial Services - 0.6%
1,782,100 Manpower, Inc. 48,339,463
676,300 Robert Half International, Inc.* 24,684,950
73,024,413
Shares or
Principal Amount Market Value
- ---------------- ------------
Computer Software and Services - 11.2%
518,600 Adobe Systems, Inc. $ 29,560,200
819,500 Computer Sciences Corp.* 54,804,063
9,078,980 First Data Corp.# 600,347,580
12,142,375 General Motors Corp. - Class E 572,209,422
2,269 NTT Data Communications Systems Corp.** 56,936,288
135,910 SAP A.G.** 21,540,235
1,335,397,788
Computers - 1.1%
1,767,325 Sun Microsystems, Inc.* 137,851,350
Electrical Equipmemt - 0.4%
4,127,000 Hitachi, Ltd.** 42,475,496
Electronics - 0.2%
356,000 Kyocera Corp.*,** 29,242,110
Electronics - Semiconductors - 3.0%
1,766,775 Intel Corp. 123,453,403
598,000 Rohm Co.** 36,400,511
2,943,750 Texas Instruments, Inc. 200,910,938
360,764,852
Entertainment - 2.3%
1,700,975 Circus Circus Enterprises, Inc.* 45,288,459
1,425,410 Thorn EMI PLC 33,184,636
3,333,900 Walt Disney Co. (The) 192,115,988
270,589,083
Financial - Bank Commercial - 2.4%
923,475 First Bank System, Inc. 45,942,881
1,401,600 First Interstate Bancorp 180,806,400
1,667,650 NBD Bancorp, Inc. 63,370,700
290,119,981
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
4
<PAGE>
JANUS FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Financial - Bank Money Center - 6.6%
6,406,400 Bank of New York Co., Inc. $ 269,068,800
7,291,950 Citicorp 473,065,256
665,000 First Chicago Corp. 45,136,875
787,270,931
Financial - Security Broker - 0.8%
971,700 Merrill Lynch and Co., Inc. 53,929,350
465,725 Morgan Stanley Group, Inc. 40,518,075
94,447,425
Financial Services - 0.3%
302,675 Federal National Mortgage Association 31,743,041
Food Processing - 1.7%
1,046,450 Hershey Foods Corp. 62,525,388
1,452,700 Kellogg Co. 104,957,575
1,559,375 Nabisco Holdings Corp. - Class A# 41,908,203
209,391,166
Forest Products and Paper - 5.7%
5,336,225 Champion International Corp.# 285,488,038
3,415,550 Georgia-Pacific Corp. 281,782,875
2,896,250 James River Corp. 93,042,031
359,702 Mo Och Domsjo A.B.** 18,339,133
678,652,077
Household Products - 1.7%
1,698,700 Colgate-Palmolive Co. 117,634,975
761,350 First Brands Corp. 34,831,763
1,978,525 Newell Co. 47,731,916
200,198,654
Insurance - Life - 2.6%
5,890,800 UNUM Corp.# 310,003,350
Insurance - Multiline - 3.2%
2,468,550 Alexander & Alexander Services, Inc.# 55,233,806
2,107,887 American International Group, Inc. 177,852,966
1,188,600 Cigna Corp. 117,819,975
1,391,150 Prudential Reinsurance Holdings, Inc.* 28,344,681
379,251,428
Insurance - Property and Casualty - 4.1%
1,287,325 ACE, Ltd. 43,769,050
2,125,900 General Re Corp. 307,989,763
460,700 Orion Capital Corp. 18,888,700
1,914,420 Progressive Corp. 79,448,430
663,125 Risk Capital Holdings, Inc.* 14,588,750
471,500 Transatlantic Holdings, Inc. 31,767,313
496,452,006
Lodging - 0.4%
89,875 Accor S.A.** 10,700,721
587,250 HFS, Inc.* 35,969,063
46,669,784
Machine - Diversified - 1.0%
1,276,250 AGCO Corp.# 57,112,188
2,178,195 American Standard Companies, Inc.* 58,266,716
115,378,904
Metals - Diversified - 0.3%
698,400 Aluminum Co. of America 35,618,400
Mining - 0.9%
725,967 Freeport McMoRan, Inc. 27,132,980
856,975 Minerals Technologies, Inc. 34,171,878
724,558 Potash Corporation of Saskatchewan, Inc. 50,447,352
111,752,210
Shares or
Principal Amount Market Value
- ---------------- ------------
Miscellaneous - Distribution and Wholesale - 0.1%
285,000 Cardinal Health, Inc. $ 14,641,875
Miscellaneous - Manufacturing - 1.0%
400,000 AlliedSignal, Inc. 17,000,000
764,931 Orkla A/S - Class A 39,548,457
118,946 Siemens A.G.** 62,331,996
118,880,453
Office and Business Equipment - 0.9%
700,000 Oce-Van Der Grinten N.V.** 40,150,844
543,900 Xerox Corp. 70,571,025
110,721,869
Oil and Gas Exploration - 0.3%
837,500 Triton Energy Corp.* 39,048,438
Packaging and Containers - 1.4%
4,910,175 Crown Cork & Seal Co., Inc.*,# 171,242,354
Pharmaceuticals - 12.3%
7,972,937 Astra A.B. - Class A** 293,445,454
60,625 Ciba-Geigy Corp. A.G. 52,299,737
848,200 Lilly (Eli) & Co. 81,957,325
1,979,500 Merck & Co., Inc. 113,821,250
6,983,200 Pfizer, Inc. 400,661,100
59,437 Roche Holding A.G. 431,650,749
5,000,000 SmithKline Beecham PLC - Class A 52,196,014
934,750 SmithKline Beecham PLC (ADR) - Class A 48,490,156
1,474,521,785
Publishing - Newspaper - 0.9%
3,261,000 Reuters Holdings PLC 30,305,583
532,825 Reuters Holdings PLC (ADS) 29,571,788
1,510,075 Times Mirror Co. - Class A 43,792,175
103,669,546
Publishing and Printing - 3.8%
6,866,770 Elsevier N.V.** 88,783,184
4,927,507 News Corp., Ltd.* 24,791,273
1,417,500 News Corp., Ltd. (ADR) 28,172,813
3,412,252 Wolters Kluwer N.V.#,** 310,558,617
452,305,887
Retail - Apparel - 0.1%
281,775 Gymboree Corp. * 6,375,160
Retail - Department Stores - 0.4%
1,989,875 Federated Department Stores, Inc.* 50,493,078
Telecommunications - 0.9%
454,550 MFS Communications Co., Inc.* 18,352,456
3,100,575 Paging Network, Inc.*,# 71,313,225
516,000 Telecomunicacoes Brasileiras S.A. 20,640,000
110,305,681
Toys - 1.6%
6,473,701 Mattel, Inc. 186,118,904
Transportation-Air - 1.6%
2,067,000 AMR Corp.* 136,422,000
932,175 Delta Air Lines, Inc. 61,173,984
197,595,984
Transportation-Railroad - 2.2%
2,861,750 Burlington Northern Santa Fe Corp. 240,029,281
295,050 Wisconsin Central Transportation Corp.* 17,776,763
257,806,044
Utilities - Telecommunications - 0.5%
740,000 Cincinnati Bell, Inc. 21,737,500
4,800 DDI Corp.** 39,004,117
60,741,617
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
5
<PAGE>
JANUS FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Wholesale - Special Line - 0.8%
1,100,025 Alco Standard Corp. $ 97,352,213
Total Common Stock (cost $8,329,367,152) 10,387,510,523
Preferred Stock - 3.7%
Banking - 0.2%
1,200,000 ConAgra Capital L.C., 7.2675%
Adjustable Rate - Series B 25,650,000
Computer Software and Services - 3.5%
2,702,413 SAP A.G.** 414,486,408
Total Peferred Stock (cost $254,992,204) 440,136,408
Corporate Bonds - 0.1%
Packaging and Containers - 0.1%
Stone Container Corp.:
$ 2,610,000 11.00% senior subordinated notes,
due 8/15/99 2,668,725
2,000,000 11.50% senior subordinated notes,
due 9/1/99 2,050,000
Total Corporate Bonds (cost $4,630,883) 4,718,725
U.S. Government Agencies - 3.7%
Federal Farm Credit Bank
25,000,000 5.63%, 11/6/95 24,980,451
Federal Home Loan Bank System
25,000,000 5.60%, 11/9/95 24,968,889
Federal Home Loan Mortgage Corp.:
50,000,000 5.60%, 11/20/95 49,852,222
20,000,000 5.66%, 11/20/95 19,940,256
25,000,000 5.66%, 11/30/95 24,886,014
Federal National Mortgage Association:
50,000,000 5.63%, 11/2/95 49,992,180
50,000,000 5.60%, 11/13/95 49,906,666
100,000,000 5.64%, 11/15/95 99,780,667
50,000,000 5.58%, 11/22/95 49,837,250
50,000,000 5.60%, 12/1/95 49,766,667
Total U.S. Government Agencies
(amortized cost $443,911,262) 443,911,262
U.S. Government Obligations - 0.8%
U.S. Treasury Notes
100,000,000 4.625%, due 2/15/96 (cost $99,658,053) 99,744,000
Shares or
Principal Amount Market Value
- ---------------- ------------
Money Market - 0.3%
$ 5,000,000 Janus Government Money Market Fund, 5.85% $ 5,000,000
30,900,000 Janus Money Market Fund, 5.90% 30,900,000
Total Money Market (cost $35,900,000) 35,900,000
Short-Term Corporate Notes - 5.3%
American Express Corp.
50,000,000 5.65%, 11/8/95 49,945,069
AT & T Corp.
25,000,000 5.62%, 11/17/95 24,937,556
Cargill, Inc.
50,000,000 5.70%, 11/1/95 50,000,000
Chevron Oil Finance Co.
25,000,000 5.70%, 11/3/95 24,992,083
Coca-Cola Co.
25,000,000 5.64%, 12/11/95 24,843,333
Ford Motor Credit Corp.
133,900,000 5.85%, 11/1/95 133,900,000
General Electric Capital Corp.
100,000,000 5.72%, 11/7/95 99,904,667
Household Finance Corp.:
50,000,000 5.73%, 11/24/95 49,816,958
100,000,000 5.74%, 11/29/95 99,553,556
Norwest Corp.
25,000,000 5.39%, 11/13/95 24,955,084
Wal-Mart Stores, Inc.
50,000,000 5.70%, 11/10/95 49,928,750
Total Short-Term Corporate Notes
(amortized cost $632,777,056) 632,777,056
Repurchase Agreement - 0.8%
State Street Bank & Trust Co., 5.84%,
100,000,000 dated 10/31/95, maturing 11/1/95, to be
repurchased at $100,016,222, Collateralized
by $92,795,000 in U.S. Treasury Notes,
8.875%, due 2/15/99, value $104,394,375 100,000,000
(cost $100,000,000)
Total Investments - 101.5% (total cost $9,901,236,610) 12,144,697,974
Liabilities, net of Cash, Receivables and Other Assets - (1.5%) (181,728,463)
Net Assets - 100% $11,962,969,511
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Fund Dutch Guilder 12/14/95 500,000,000 $ 317,641,827 $ (15,709,460)
French Franc 1/11/96 46,000,000 9,415,040 (238,897)
German Deutschemark 12/14/95 605,000,000 430,727,609 (19,974,690)
Japanese Yen 2/8/96 1,400,000,000 13,712,893 240,399
Japanese Yen 3/14/96 15,350,000,000 150,359,590 6,318,899
Swedish Krona 11/9/95 300,500,000 45,318,815 (3,110,795)
Swedish Krona 1/11/96 839,448,000 126,003,512 (6,728,833)
Swedish Krona 1/25/96 760,000,000 113,973,786 (204,260)
$1,207,153,072 $ (39,407,637)
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
6
<PAGE>
JANUS BALANCED FUND Portfolio Manager, James P. Craig
PERFORMANCE REVIEW
Janus Balanced Fund had a return of 18.26% for the fiscal year ended
October 31, 1995, compared to a return of 26.44% for the S&P 500 Index, and a
return of 26.18% for the Lehman Brothers Long Government/Corporate Bond Index.
All returns include reinvested dividends.
The Fund underperformed its benchmark indexes because we misjudged the data
points on inflation and pursued a conservative strategy. As a result, we did not
participate in much of the capital appreciation in the bond market and missed
some of the early gains in stocks. The Fund's fixed-income securities had
relatively short maturities of 3-5 years. Yields on shorter maturities remained
competitive with long bonds, but the long end of the market appreciated more.
Equity performance was also held down by earnings disappointments in Wal-Mart
and Crown Cork & Seal.
On the plus side, we recognized early the potential of business software
provider SAP and the effect of the outsourcing boom on EDS (General Motors E)
and First Data, which helped performance.
THE PORTFOLIO
Fixed-Income. As of October 31, the fixed-income portion of the Fund was
48.3% of assets, versus 48.8% at the end of October 1994.
- --------------------------------------------------------------------------------
Fixed-Income Holdings October 31, 1995 October 31, 1994
Cash & Cash Equivalents 2.8% 21.2%
Preferred Stock 3.7% 20.5%
Convertible Bonds 1.4% 0.6%
U.S. Corporate Bonds 28.7% 0.3%
Foreign Bonds 0.8% 1.0%
Government Bonds 10.9% 5.2%
- --------------------------------------------------------------------------------
Investment grade corporate bonds remained the largest segment of the
fixed-income portfolio, with 1.6% in high-yield/high-risk (junk) bonds and the
remaining 28.5% in investment grade bonds. We increased the percentage of
government bonds, of which a modest 3.9% are in 30-year Treasuries. Long-term
bonds have a slightly better yield and hold more potential for appreciation.
Adjustable rate preferreds have been eliminated.
Equities. The equity portion of the portfolio was 51.7% of assets at year
end, versus 51.2% at year-end 1994. The largest ten positions are 26.1% of
assets.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
SAP AG 3.7% --
Prudential Reinsurance 3.7% --
General Motors E 3.6% 1.9%
First Data Corp. 3.0% 2.5%
Robert Half International 2.8% --
Citicorp 2.3% 1.5%
UNUM 2.0% 2.1%
Kellogg Co. 1.8% --
Roche Holdings 1.6% --
Risk Capital Holdings 1.6% --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Computer Software and Services 10.9% 4.0%
Insurance - Multiline 5.4% 1.5%
Insurance - Property and Casualty 3.4% 0.6%
Financial - Bank Money Center 3.3% 2.9%
Food Processing 3.0% --
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Outsourcing. It is now standard business practice to farm out functions
such as data processing and computer operations to outside specialists. EDS and
First Data Corporation are outsourcers that are benefiting from this trend.
First Data's credit card transaction volume is growing by 20% annually. It has
also acquired First Financial Management, the largest credit card transaction
processor for merchants and now dominates the transaction processing market. EDS
currently has $36 billion in data processing contracts and should originate $10
billion in new contracts this year. Robert Half International provides
accounting temps.
Stock Repurchase. Cash flow is strong at many U.S. corporations.
Streamlined operations and a focus on more profitable business sectors have
produced excess cash. Instead of acquiring less profitable businesses or issuing
dividends, Citicorp, defense contractor McDonnell Douglas, and paper
manufacturer Champion International are repurchasing shares to add shareholder
value.
Insurance. The industry is restructuring, boosting efficiency, and
increasing earnings. We own disability provider UNUM, Alexander and Alexander, a
diversified insurance broker, and have added reinsurers Risk Capital and
Prudential Reinsurance.
Banking. Banking has also become more efficient and is focusing on its more
profitable operations. Citicorp has a strong credit card business as well as an
established presence in many emerging economies. Klamath First Bancorp is a
thrift that recently converted to public ownership. Bank of New York is
increasing profitability by expanding its securities processing operations.
THE BALANCED STRATEGY
In the current positive market environment of low interest rates and low
inflation, our strategy is to hold our growth stocks, adding positions when we
see opportunities and trimming or eliminating companies that hit our price
targets. We believe this strategy will continue to provide solid and consistent
returns, with less volatility than a pure growth fund.
A NEW PORTFOLIO MANAGER IN 1996.
We are pleased to announce that Blaine Rollins will take over management of
Janus Balanced Fund on January 1, 1996. Blaine is a Chartered Financial Analyst,
and has been an analyst at Janus since 1990. He began his career in the
fixed-income area, so he is proficient in both sectors of the balanced
discipline.
Thank you for your investment in Janus Balanced Fund.
Janus Funds October 31, 1995 Annual Report
7
<PAGE>
JANUS BALANCED FUND Portfolio Manager, James Craig
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Balanced Fund, the S&P 500 Index and the Lehman Brother Long
Government/Corporate Bond Index. Janus Balanced Fund is represented by a solid
green line, the S&P 500 Index is represented by a single dashed black line, and
the Lehman Brother Long Government/Corporate Bond Index is represented by a
double dashed dark gray line. The "y" axis reflects the value of the investment.
The "x" axis reflects the computation periods from inception, September 1, 1992,
through October 31, 1995. The upper right quadrant reflects the ending value of
the hypothetical investment in Janus Balanced Fund ($14,885) as compared to the
S&P 500 Index ($16,805) and the Lehman Brother Long Government/Corporate Bond
Index ($14,573). There is a legend in the upper left quadrant of the graph which
indicates Janus Balanced Fund's one-year and since inception (September 1, 1992)
average annual total returns as 18.26% and 13.38%, respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the
indexes. The indexes are unmanaged.
JANUS BALANCED FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 51.7%
Aerospace and Defense - 2.4%
7,125 Boeing Co. $ 467,578
15,775 McDonnell Douglas Corp. 1,289,606
14,425 United Technologies Corp. 1,280,219
3,037,403
Chemicals - 0.6%
14,200 Hercules, Inc. 757,925
Commercial Services - 2.8%
94,950 Robert Half International, Inc.* 3,465,675
Computer Software and Services - 7.2%
12,400 Adobe Systems, Inc. 706,800
56,620 First Data Corp. 3,743,998
95,950 General Motors Corp. - Class E 4,521,644
8,972,442
Electronics - 2.3%
19,650 Dionex Corp. 1,061,100
29,525 Pittway Corp. - Class A 1,767,809
2,828,909
Electronics - Semiconductors - 0.7%
13,750 Texas Instruments, Inc. 938,437
Entertainment - 0.7%
16,600 Walt Disney Co. (The) 956,575
Financial - Bank Commercial - 3.0%
11,975 First Bank System, Inc. 595,756
4,500 First Interstate Bancorp 580,500
33,100 NBD Bancorp, Inc. 1,257,800
22,675 Star Banc Corp. 1,255,628
3,689,684
Shares or
Principal Amount Market Value
- ---------------- ------------
Financial - Bank Money Center - 3.3%
30,000 Bank of New York Co., Inc. $ 1,260,000
43,400 Citicorp 2,815,575
4,075,575
Financial - Savings/Loan/Thrift - 1.5%
147,625 Klamath First Bancorp, Inc.* 1,882,219
Food Processing - 3.0%
21,700 General Mills, Inc. 1,245,038
6,075 Hershey Foods Corp. 362,981
30,275 Kellogg Co. 2,187,369
3,795,388
Forest Products and Paper - 1.7%
15,000 Champion International Corp. 802,500
15,325 Georgia-Pacific Corp. 1,264,313
2,066,813
Household Products - 0.5%
13,250 First Brands Corp. 606,187
Insurance - Life - 2.0%
47,600 UNUM Corp. 2,504,950
Insurance - Multiline - 5.4%
42,425 Alexander & Alexander Services, Inc. 949,259
46,500 Allmerica Financial Corp.* 1,168,313
223,700 Prudential Reinsurance Holdings, Inc.* 4,557,888
6,675,460
Insurance - Property and Casualty - 3.4%
7,325 ACE, Ltd. 249,050
7,875 General Re Corp. 1,140,891
20,800 Progressive Corp. 863,200
90,000 Risk Capital Holdings, Inc.*,+ 1,980,000
4,233,141
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
8
<PAGE>
JANUS BALANCED FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Leisure Time - 0.2%
6,250 Coleman Co., Inc.* $ 214,062
Machine - Diversified - 0.4%
11,225 AGCO Corp. 502,319
Mining - 2.5%
34,979 Freeport McMoRan, Inc. 1,307,346
33,300 Minerals Technologies, Inc. 1,327,837
6,812 Potash Corporation of Saskatchewan, Inc. 474,286
3,109,469
Packaging and Containers - 0.9%
32,250 Crown Cork & Seal Co., Inc.* 1,124,719
Pharmaceuticals - 2.6%
275 Roche Holding A.G. 1,997,139
24,050 SmithKline Beecham PLC (ADR) - Class A 1,247,594
3,244,733
Publishing - Newspaper - 0.5%
11,275 Reuters Holdings PLC (ADS) 625,762
Publishing and Printing - 1.5%
20,000 Wolters Kluwer N.V.** 1,820,256
Telecommunications - 0.6%
10,100 MFS Communications Co., Inc.* 407,787
15,925 Paging Network, Inc.* 366,275
774,062
Transportation - Air - 1.2%
8,050 AMR Corp.* 531,300
15,075 Delta Air Lines, Inc. 989,297
1,520,597
Transportation-Railroad - 0.8%
15,000 Union Pacific Corp. 980,625
Total Common Stock (cost $56,429,955) 64,403,387
Preferred Stock - 3.7%
30,240 SAP A.G.** (cost $3,260,349) 4,638,103
Corporate and Convertible Bonds - 30.1%
Aerospace and Defense - 0.7%
$ 900,000 Rockwell International Corp., 7.625%
notes, due 2/17/98 928,125
Auto and Truck - 2.4%
3,000,000 General Motors Corp., 7.40%
debentures, due 9/1/25 3,063,750
Captive Finance - Auto - 8.1%
10,000,000 Ford Motor Credit Corp., 6.25%
unsubordinated notes, due 2/26/98 10,037,500
Shares or
Principal Amount Market Value
- ---------------- ------------
Captive Finance - Industrial - 1.7%
$ 2,000,000 General Electric Capital Corp., 8.00%
notes, due 1/15/98 $ 2,080,000
Computers - 8.1%
10,000,000 IBM Corp., 6.375%,
global notes, due 6/15/00 10,050,000
Financial Services - 2.4%
3,000,000 Household International Netherlands B.V.,
6.00% senior notes, due 3/15/99 2,973,750
Insurance - Multiline - 2.5%
2,430,000 International Lease Finance Corp., 7.50%
notes, due 3/1/99 2,521,125
600,000 Leucadia National Corp., 5.25%
convertible subordinated debentures,
due 2/1/03 639,000
3,160,125
Leisure Time - 0.9%
3,610,000 Coleman Worldwide Corp., zero coupon
convertible liquid yield option notes,
due 5/27/13 1,060,438
Oil and Gas - Domestic - 0.3%
310,000 Texas Eastern Transmission Corp., 10.00%
sinking fund debentures, due 10/1/11 328,987
Pharmaceuticals - 2.2%
2,660,000 American Home Products Corp., 7.70%
notes, due 2/15/00 2,796,325
Retail - 0.8%
1,000,000 Ralphs Grocery Co., 11.00%
senior subordinated notes, due 6/15/05 971,250
Total Corporate and Convertible Bonds (cost $37,067,170) 37,450,250
Foreign Bonds - 0.8%
1,000,000 Kingdom of Sweden, 5.50%
debentures, due 12/1/95 (cost $1,000,817) 998,750
U.S. Government Obligations - 10.9%
U.S. Treasury Notes:
5,250,000 6.00%, 10/15/99 5,291,895
3,500,000 5.75%, 10/31/00 3,490,235
4,500,000 6.875%, 8/15/25 4,829,850
Total U.S. Government Obligations (cost $13,585,671) 13,611,980
Total Investments - 97.2% (cost $111,343,962) 121,102,470
Cash, Receivables and Other Assets, net of Liabilities - 2.8% 3,442,465
Net Assets - 100% $124,544,935
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Balanced Fund Dutch Guilder 12/14/95 2,000,000 $1,270,567 $ (62,838)
German Deutschemark 12/14/95 5,625,000 4,004,699 (195,788)
$5,275,266 $ (258,626)
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
9
<PAGE>
JANUS ENTERPRISE FUND Portfolio Manager, James P. Goff
PERFORMANCE REVIEW
Low interest rates and excellent corporate earnings drove the rally in
financial assets during the fiscal year ended October 31, 1995. The S&P 500
Index gained 26.44% for the period, while Janus Enterprise Fund appreciated
15.46%. Both returns include reinvested dividends.
The Fund's performance this year reminds us of a quote from Charles
Dickens: "It was the best of times, it was the worst of times." Although the
Fund produced solid returns, it under-performed the Index for the first time
since inception. Long-term returns remain very strong, however: since it opened
in September 1992, Janus Enterprise Fund produced an average annual return of
23.08%, versus 14.43% for the S&P 500 Index.
The Fund's underperformance this year had several causes. Some we can
correct, and some we do not want to correct. Let's start with what we do not
want to fix: namely, our investment approach. The portfolio is focused on
companies with predictable earnings over the long term. Unfortunately, it is
harder to find these companies in the technology sector, which has been red hot
for several years. The Fund gave up some performance by not investing more
heavily in technology. Earnings of many tech companies were terrific, but they
also remained hard to predict. Product cycles, and sometimes corporate cycles,
can still be disturbingly short. As Jim Craig has pointed out, most of the
exciting technology companies from the early 1980s are not with us anymore.
We are also not interested in the big financial restructuring stories that
have done well this year. These companies tend to offer short-term returns. They
may help their bottom line by cutting costs, but unless revenue growth is
substantial, the potential for long-term growth is limited.
We can do something about our stock selection. We took a large position in
Exide, a maker of industrial and automotive batteries that has excellent
management and was chewing up the competition, here and in Europe. However, an
earnings disappointment that was largely due to a record warm winter in the U.S.
and Europe knocked Exide's stock down. We do not normally consider the weather a
factor in our earnings analysis, but this year it killed us. Exide was
responsible for approximately half the difference between our performance and
that of the S&P 500 Index. We tried to throw too deep and our timing was bad.
We trimmed the positions in Exide and APS Holdings, which has also been a
lackluster performer this year, but we increased Paging Network after the stock
weakened, and it has performed very well. Diverse holdings such as lodging
company HFS, British pub chain J.D. Wetherspoon, outsourcer Medaphis, and animal
supplies retailer Petco also contributed to performance. This eclectic group is
representative of our stock-by-stock investment approach.
PORTFOLIO COMPOSITION
As of year end, the portfolio was 99% invested in equities, versus 90.7%
when the year began, which reflects the many excellent individual ideas we are
finding in the current market. Foreign securities accounted for 7.4% of
holdings, down from 15.5% at the end of October 1994, and are predominantly in
Europe. The ten largest positions were 52.4% of assets.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
Paging Network Inc. 8.1% 4.6%
HFS, Inc. 7.3% --
R.P. Scherer Corp. 6.3% 3.5%
Minerals Technologies 5.0% 2.8%
Insignia Financial Group 4.7% 4.5%
Medaphis Corp. 4.5% --
APS Holdings Corp. 4.5% 7.0%
First Data Corp. 4.4% --
Exide Corp. 3.9% 14.5%
J.D. Wetherspoon 3.7% 1.4%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Telecommunications 11.8% 13.5%
Pharmaceuticals 9.7% 5.8%
Retail 8.9% 4.5%
Auto Parts - Replacement 8.3% 22.7%
Commercial Services 7.3% 0.7%
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Wireless Communications. Paging Network, Arch Communications, and Commnet
Cellular are service providers that are experiencing a strong cycle of
subscriber growth.
Pharmaceuticals. Innovations in drug delivery systems make R.P. Scherer and
TheraTech very well positioned to supply a robust pharmaceutical industry.
Retailers. Autozone (auto parts), J.D. Wetherspoon, Lone Star Steakhouse,
General Nutrition Centers, and Petco are fast growing companies in specialized
markets.
Niche Manufacturers. Exide and Littelfuse (electrical fuses), APS Holdings
(auto parts), Sealed Air (packaging), and Minerals Technology (paper additive)
either dominate a niche market or have very competitive market franchises.
Outsourcing. The most cost-effective means of handling complex operations
such as data processing and other computer functions is often through outside
specialists. First Data has just acquired competitor First Financial Management,
and is now the largest processor of credit card transactions for both banks and
merchants. Medaphis handles accounting and billing functions for physicians.
Financial Services. Consumer loan demand remains strong, and Credit
Acceptance (nonstandard auto loans), and World Acceptance (diversified consumer
lending) are benefiting. Insignia Financial is the largest manager of real
estate and real estate partnerships in the U.S.
PORTFOLIO STRATEGY
Because the Fund's portfolio is concentrated, performance can sometimes be
streaky. We analyze a wide range of ideas to find those that can grow earnings
at a high rate for a long period of time, regardless of the economic
environment. Finding these companies is a difficult task, but that remains our
objective and we are enthusiastic about the prospects of the companies the Fund
holds.
We appreciate your investment in Janus Enterprise Fund.
Janus Funds October 31, 1995 Annual Report
10
<PAGE>
JANUS ENTERPRISE FUND Portfolio Manager, James P. Goff
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Enterprise Fund and the S&P 500 Index. Janus Enterprise Fund is
represented by a solid green line and the S&P 500 Index is represented by a
single dashed black line. The "y" axis reflects the value of the investment. The
"x" axis reflects the computation periods from inception, September 1, 1992,
through October 31, 1995. The upper right quadrant reflects the ending value of
the hypothetical investment in Janus Enterprise Fund ($19,304) as compared to
the S&P 500 Index ($14,903). There is a legend in the upper left quadrant of the
graph which indicates Janus Enterprise Fund's one-year and since inception
(September 1, 1992) average annual total returns as 15.46% and 23.08%,
respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the
indexes. The index is unmanaged.
JANUS ENTERPRISE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 97.4%
Advertising - 0.8%
198,500 Katz Media Group, Inc.* $ 3,573,000
Auto Parts-Replacement - 8.3%
1,000,000 APS Holding Corp. - Class A*,# 20,500,000
405,555 Exide Corp.# 17,793,726
38,293,726
Commercial Services - 7.3%
270,375 CUC International, Inc.* 9,361,734
83,683 Loewen Group, Inc. 3,351,245
650,000 Medaphis Corp.* 20,637,500
33,350,479
Computer Software and Services - 6.7%
650,500 Black Box Corp.* 10,570,625
308,050 First Data Corp. 20,369,806
30,940,431
Financial Services - 2.6%
88,000 Credit Acceptance Corp.* 2,068,000
750,000 World Acceptance Corp.* 9,750,000
11,818,000
Holding Companies - Diversified - 1.1%
182,012 Kinnevik A.B. - Class B** 5,051,699
Insurance - Life - 0.9%
150,000 Protective Life Corp. 4,275,000
Insurance - Property and Casualty - 2.7%
300,000 Progressive Corp. 12,450,000
Lodging - 7.3%
550,000 HFS, Inc.* 33,687,500
Medical - Hospital Management Services - 1.1%
198,525 HealthSouth Corp.* 5,186,466
Shares or
Principal Amount Market Value
- ---------------- ------------
Medical Supplies - 2.3%
38,125 Gulf South Medical Supply, Inc.* $ 791,094
271,850 Omnicare, Inc. 9,854,563
10,645,657
Mining - 5.0%
572,600 Minerals Technologies, Inc. 22,832,425
Miscellaneous - Distribution and Wholesaler - 0.9%
77,500 Cardinal Health, Inc. 3,981,563
Miscellaneous - Manufacturing - 3.4%
900,000 Trigen Energy Corp.# 15,750,000
Packaging and Containers - 1.7%
299,950 Sealed Air Corp.* 7,911,181
Pharmaceuticals - 9.7%
650,000 R.P. Scherer Corp.* 28,925,000
59,250 Teva Pharmaceutical Industries, Ltd. (ADR) 2,325,563
700,000 TheraTech, Inc.*,# 13,125,000
44,375,563
Real Estate - 4.7%
800,000 Insignia Financial Group, Inc. - Class A*,# 21,600,000
Restaurants and Food Services - 6.0%
116,125 Lone Star Steakhouse & Saloon, Inc.* 4,485,328
156,700 Papa John's International, Inc.* 6,032,950
1,700,000 Wetherspoon (J.D.) PLC** 17,115,234
27,633,512
Retail - Special Line - 8.9%
355,025 AutoZone, Inc.* 8,786,869
600,000 General Nutrition Companies, Inc.* 14,925,000
143,025 Global DirectMail Corp.* 3,897,431
58,675 Hollywood Entertainment Corp.* 1,569,556
409,175 Petco Animal Supplies, Inc.*,# 11,456,900
40,635,756
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
11
<PAGE>
JANUS ENTERPRISE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Telecommunications - 11.8%
460,425 Arch Communications Group, Inc.* $ 12,489,028
181,825 CommNet Cellular, Inc.* 4,568,353
1,619,075 Paging Network, Inc.* 37,238,724
54,296,105
Tobacco - 1.8%
881,000 PT Hanjaya Mandala Sampoerna* 8,150,221
Transportation-Railroad - 2.4%
181,925 Wisconsin Central Transportation Corp.* 10,960,981
Total Common Stock (cost $367,877,536) 447,399,265
Shares or
Principal Amount Market Value
- ---------------- ------------
Warrants - 1.6%
296,050 Littelfuse, Inc. - exp. 12/27/01* $ 7,512,269
(cost $4,357,861)
Short Term Corporate Note - 1.8%
Household Finance Corp.
$ 8,200,000 5.82%, 11/1/95 8,200,000
(amortized cost $8,200,000)
Total Investments - 100.8% (total cost $380,435,397) 463,111,534
Liabilities, net of Cash, Receivables and Other Assets - (0.8%) (3,741,796)
Net Assets - 100% $459,369,738
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Enterprise Fund British Pound 1/11/96 1,923,000 $3,034,494 $ 1,731
British Pound 1/24/96 2,673,600 4,218,139 54,809
British Pound 2/8/96 281,000 443,165 4,327
Swedish Krona 11/9/95 10,012,000 1,509,923 (103,645)
Swedish Krona 1/25/96 5,200,000 779,821 (77,687)
Swedish Krona 2/8/96 8,365,000 1,253,146 (111,099)
$11,238,688 $ (231,564)
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
12
<PAGE>
JANUS GROWTH AND INCOME FUND Portfolio Manager, Thomas F. Marsico
PERFORMANCE REVIEW
The U.S. financial markets rallied during the fiscal year ended October 31,
1995. The economic environment remains very supportive for growth stocks, with
economic growth at moderate levels, and inflation and interest rates low.
Janus Growth and Income Fund returned 24.20% for the twelve-month period,
while the S&P 500 Index gained 26.44%. Both returns include reinvested
dividends. The Fund's total return ranked 71st out of 408 funds (top 17%) in the
Growth and Income category of Lipper Analytical Services, Inc., the mutual fund
rating company.(1)
Much of the Fund's underperformance for the period occurred in the last two
months of 1994. In 1995 (January-October), Janus Growth and Income Fund had a
total return of 31.03% versus 29.30% for the S&P 500 Index. Late in 1994,
however, some of our positions, such as Motorola, Astra, and Federal National
Mortgage Association did not appreciate in line with the market, but instead
caught up later in the year. Health care stocks, especially HMOs,
underperformed, and we had several earnings disappointments, including
home-improvement chain Lowes, packaging manufacturer Crown Cork & Seal, and
casino-owner Circus Circus.
Janus Growth and Income Fund has a relatively aggressive portfolio, with a
high proportion of faster-growing technology and telecommunications stocks, such
as Texas Instruments, LSI Logic, and Nokia. The Fund also holds dominant
multinationals, e.g., Citicorp and SAP, and outsourcers EDS (General Motors E)
and First Data. These stocks performed well, as did pharmaceuticals Pfizer and
Roche. Our patience with financial stocks early in the year was also rewarded.
First Interstate Bancorp and Chemical Banking are now benefiting from
consolidating operations internally, through new efficiencies, and externally,
through acquisitions.
Our dividend stocks have also performed. Shell Transport hit fair valuation
and was sold, but we still own American Express DECS, which give us a call on
First Data common stock, as well as Imperial Oil, Pacific Telesis, Browning
Ferris, and Diebold.
PORTFOLIO COMPOSITION
As of year end, the portfolio was 94% invested in stocks, versus 91.3% when
the year began. Our substantial commitment indicates the many individual
opportunities we are finding in the current market. The percentage of foreign
stocks was unchanged, at 9.2% of assets, and were still mostly European. The ten
largest holdings were 33.7% of assets at year end. Stocks in the portfolio
numbered 53.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
American Express DECS 5.2% 5.4%
Sun Microsystems 5.0% --
Pfizer 3.6% 3.3%
McDonnell Douglas 3.0% --
Citicorp 3.0% 3.5%
Merrill Lynch 2.9% 2.6%
Chemical Banking 2.9% --
Amgen 2.7% --
LSI Logic Corp. 2.7% --
Federal National Mtg. Assoc 2.7% 3.1%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Pharmaceuticals/Biopharmaceuticals 13.2% 4.5%
Electronics - Semiconductors 8.4% --
Computers 7.6% 6.9%
Financial - Bank Money Center 5.9% 4.1%
Computer - Software and Services 4.4% 1.1%
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Multinationals. Large multinational companies have an excellent competitive
position in increasingly integrated global markets. Coca-Cola, Pfizer, Citicorp,
Merrill Lynch, SAP, and Roche each essentially owns a global franchise because
many of their products have brand name recognition internationally.
Technology. Though technology was selectively trimmed near year end, the
sector continues to create powerful new products (Windows 95 and Pentium are two
recent examples) with exciting new applications (such as the Internet). Sun
Microsystems, a recent addition, is the preferred provider of commercial
equipment for the Internet. SAP owns and markets integrated business software,
and Texas Instruments is developing a new video display technology for
television that has the potential to redefine a technology that is basically
unchanged since the 1950s.
Outsourcing. Outside specialists, especially in computer operations and
data processing, are increasingly cost-effective. Data processor EDS (General
Motors E) is being spun off by General Motors. First Data has recently acquired
competitor First Financial Management, and is now the largest credit card
transaction processor for both banks and merchants.
Pharmaceuticals. In the U.S., Pfizer, Amgen, and Merck, and in Europe,
Astra and Roche all have products on the market or in development with enormous
international potential. New therapies are being developed for osteoporosis,
Alzheimer's, and diabetes.
Financial Services. Merrill Lynch, Citicorp, and Chemical Banking are all
benefiting from more efficient operations and fast-growing international
markets. Federal National Mortgage Association has a secure franchise in the
domestic mortgage market for low-cost housing.
Stock Repurchase. Companies that wish to enhance shareholder value are
repurchasing stock. Share repurchase often indicates that a company intends to
focus on what it does best, i.e., its most profitable operations. Citicorp,
Merrill Lynch, Sun Microsystems, PepsiCo, Chemical Banking, and chemical company
Hercules have significant stock repurchase programs.
CURRENT STRATEGY
Janus Growth and Income Fund remains poised to benefit from the excellent
climate for growth stocks. We also continue to find opportunities in companies
that combine exciting earnings growth with a significant income component.
Thank you for your investment in Janus Growth and Income Fund.
- ----------------------------
(1) Lipper Analytical Services, Inc. defines a Growth and Income Fund as one
"which combines a growth of earnings orientation and an income requirement
for level and/or rising dividends." The ranking is based on total return,
including reinvestment of dividends and capital gains for the stated
period. Past performance is not predictive of future results.
Janus Funds October 31, 1995 Annual Report
13
<PAGE>
JANUS GROWTH AND INCOME FUND Portfolio Manager, Thomas F. Marsico
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Growth and Income Fund and the S&P 500 Index. Janus Growth and Income
Fund is represented by a solid green line and the S&P 500 Index is represented
by a single dashed black line. The "y" axis reflects the value of the
investment. The "x" axis reflects the computation periods from inception, May
15, 1991, through October 31, 1995. The upper right quadrant reflects the ending
value of the hypothetical investment in Janus Growth and Income Fund ($19,214)
as compared to the S&P 500 Index ($17,905). There is a legend in the upper left
quadrant of the graph which indicates Janus Growth and Income Fund's one-year
and since inception (May 15, 1991) average annual total returns as 24.20% and
15.78%, respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the index.
The index is unmanaged.
JANUS GROWTH AND INCOME FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 86.5%
Aerospace and Defense - 3.2%
17,875 Lockheed Martin Corp. $ 1,217,734
215,000 McDonnell Douglas Corp. 17,576,250
18,793,984
Auto Parts-Replacement - 0.5%
66,750 Exide Corp. 2,928,656
Beverages - 4.3%
200,000 Coca-Cola Co. 14,375,000
200,000 PepsiCo, Inc. 10,550,000
24,925,000
Biopharmaceuticals - 2.7%
333,300 Amgen, Inc.* 15,998,400
Chemicals - 0.9%
100,000 Hercules, Inc. 5,337,500
Computer Software and Services - 2.1%
70,400 Intuit, Inc.* 5,068,800
83,950 Netscape Communications Corp.* 7,387,600
12,456,400
Computers - 7.6%
265,000 Compaq Computer Corp.* 14,773,750
375,000 Sun Microsystems, Inc.* 29,250,000
44,023,750
Electronics - 2.9%
216,375 Altera Corp.* 13,090,688
68,250 Diebold, Inc. 3,617,250
16,707,938
Shares or
Principal Amount Market Value
- ---------------- ------------
Electronics - Semiconductors - 8.4%
127,500 Etec Systems, Inc.* $ 1,402,500
100,000 Intel Corp. 6,987,500
339,375 LSI Logic Corp.* 15,993,047
444,375 National Semiconductor Corp.* 10,831,641
200,000 Texas Instruments, Inc. 13,650,000
48,864,688
Entertainment - 2.6%
258,250 Walt Disney Co. (The) 14,881,656
Financial - Bank Commercial - 4.6%
230,450 First Bank System, Inc. 11,464,888
70,000 First Interstate Bancorp 9,030,000
29,200 Wells Fargo & Co. 6,135,650
26,630,538
Financial - Bank Money Center - 5.9%
295,750 Chemical Banking Corp. 16,820,781
269,000 Citicorp 17,451,375
34,272,156
Financial - Security Broker - 2.9%
307,000 Merrill Lynch and Co., Inc. 17,038,500
Financial Services - 3.1%
37,475 Federal Home Loan Mortgage Corp. 2,595,144
148,350 Federal National Mortgage Association 15,558,206
18,153,350
Forest Products and Paper - 1.4%
50,000 Champion International Corp. 2,675,000
94,775 Willamette Industries, Inc. 5,496,950
8,171,950
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
14
<PAGE>
JANUS GROWTH AND INCOME FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Lodging - 2.4%
225,000 HFS, Inc.* $ 13,781,250
Machine - Diversified - 0.7%
122,900 Harnischfeger Industries, Inc. 3,871,350
Metals - Diversified - 0.8%
76,800 Phelps Dodge Corp. 4,867,200
Oil and Gas - Domestic - 1.2%
193,800 Imperial Oil, Ltd. 7,073,700
Pharmaceuticals - 10.5%
261,688 Astra A.B. - Class A 9,631,476
266,425 Merck & Co., Inc. 15,319,438
369,050 Pfizer, Inc. 21,174,244
2,100 Roche Holding A.G.** 15,250,880
61,376,038
Restaurants and Food Services - 5.2%
360,000 Boston Chicken, Inc.* 12,172,500
345,000 Lone Star Steakhouse & Saloon, Inc.* 13,325,625
50,000 McDonald's Corp. 2,050,000
75,000 Papa John's International, Inc.* 2,887,500
30,435,625
Retail - Apparel - 3.3%
268,900 Fila Holdings S.p.A. (ADR) 11,596,313
470,000 Intimate Brands, Inc.* 7,872,500
19,468,813
Retail - Special Line - 0.9%
195,000 Hollywood Entertainment Corp.* 5,216,250
Telecommunications - 0.2%
60,000 Paging Network, Inc.* 1,380,000
Telecommunications - Equipment - 2.2%
135,400 U.S. Robotics Corp.* 12,524,500
Transportation - Air - 4.1%
200,000 AMR Corp.* 13,200,000
61,000 UAL Corp.* 10,728,375
23,928,375
Utilities - Telecommunications - 1.9%
362,350 Pacific Telesis Group 11,006,380
Total Common Stock (cost $437,268,263) 504,113,947
Shares or
Principal Amount Market Value
- ---------------- ------------
Preferred Stock - 7.5%
Computer Software and Services - 2.3%
13,000 SAP A.G.** $ 1,993,893
225,000 SAP A.G. (ADR)#,+,** 11,390,625
13,384,518
Financial Services - 5.2%
552,500 American Express Co. Exchange Notes, 6.25%
(Debt Exchangeable for Common Stock) 30,318,438
Total Preferred Stock (cost $30,382,832) 43,702,956
Corporate and Convertible Bonds - 5.3%
Auto Parts - Original - 1.1%
$ 6,500,000 Magna International, Inc., 5.00%
convertible subordinated debentures,
due 10/15/02 6,621,875
Homebuilders - 1.9%
6,500,000 M.D.C. Holdings, Inc., 11.125%
senior notes, due 12/15/03 6,077,500
5,000,000 M.D.C. Holdings, Inc., 8.75%
convertible subordinated notes,
due 12/15/05 4,975,000
11,052,500
Retail - Apparel - 2.3%
15,000,000 Sandoz Capital, Ltd., 2.00%
bank guaranteed notes, due 10/6/02+ 13,275,000
Total Corporate and Convertible Bonds (cost $29,352,663) 30,949,375
Short-Term Corporate Note - 0.5%
2,800,000 Household Finance Corp.
5.82%, 11/1/95 2,800,000
(amortized cost $2,800,000)
Total Investments - 99.8% (total cost $499,803,758) 581,566,278
Cash, Receivables and Other Assets, net of Liabilities - 0.2% 1,396,782
Net Assets - 100% $582,963,060
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Growth and Income Fund German Deutschemark 11/17/95 1,560,000 $1,109,058 $ (22,967)
German Deutschemark 4/11/96 2,400,000 1,718,336 (21,743)
Swiss Franc 11/17/95 5,076,028 4,478,585 (217,241)
Swiss Franc 11/20/95 4,449,224 3,926,941 (168,206)
Swiss Franc 2/20/96 5,256,100 4,685,416 (344,761)
Swiss Franc 4/11/96 1,000,000 896,057 (17,477)
$16,814,393 $ (792,395)
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
15
<PAGE>
JANUS MERCURY FUND Portfolio Manager, Warren B. Lammert
PERFORMANCE REVIEW
The sharp decline in interest rates during our fiscal year ended October
31, 1995 is largely responsible for the robust performance of the financial
markets. Yield on the benchmark 30-year Treasury Bond has dropped from a high of
8.15% in early November 1994 to 6.33% on October 31, 1995. The S&P 500 Index
gained 26.44% for the period and registered new highs along the way. Janus
Mercury Fund produced very solid gains as well, up 25.53%. Both returns include
reinvested dividends.
Janus Mercury Fund has the flexibility to invest in a wide range of small
and large domestic and overseas stocks. Individual stock picks determine our
fate. However, over the last twelve months the broad universe of securities
represented in the portfolio proved a slight restraint on performance. Most of
the action was in larger U.S. stocks, as detailed in "Our Message to You" on
page 1.
Still, we believe our flexible approach provides better opportunities over
the long term. Since its inception in May 1993, Janus Mercury Fund has an
average annual total return of 25.73% versus 14.93% for the S&P 500 Index.
Performance was helped by our attention to interest rate movement earlier
in the year. We began the year positioned cautiously, but after the divergence
between stock and bond prices was resolved in November 1994, and bond prices
began to improve, we invested quickly. We also focused on technology. In 1994
technology was the place to be, but it was merely a warm-up for 1995. We chose
very good individual companies, such as SAP, LSI Logic, Analog Devices, and Sun
Microsystems, in semiconductors and software. In retrospect, some of our
valuation models proved too conservative, which caused us to sell selected
holdings early.
Finally, a diverse group of individual stocks, in particular lodging
company HFS, have contributed to performance.
COMPOSITION OF THE PORTFOLIO
The Fund ended the year 87.4% invested in equities, up from 68.6% when the
year began. The current rate of investment is indicative of our continuing
confidence in the U.S. and European markets. Foreign holdings made up
approximately 22.6% of the portfolio, with 17.4% of assets invested in Europe.
The ten largest positions accounted for 27.9% of assets.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
SAP AG 4.3% 4.1%
HFS Inc. 3.7% --
Crown Cork & Seal 2.7% --
Chase Manhattan 2.6% --
Sun Microsystems 2.6% --
Amgen Inc. 2.6% --
Analog Devices Inc. 2.4% --
Nokia 2.4% 6.8%
Kinnevik 2.3% 4.5%
First Data Corp. 2.3% --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Computer Software and Services 12.6% 4.3%
Pharmaceuticals 6.5% 8.5%
Telecommunications Equipment 6.1% --
Electronics 5.8% 2.6%
Telecommunications 4.7% 6.1%
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Technology. Semiconductors and computer-related stocks continue to benefit
from dramatic advances in the speed and power of new products. Windows 95 and
Pentium are but two recent examples. New applications - such as the Internet -
have also exploded. Sun Microsystems is the preferred product provider for the
Internet. Semiconductor manufacturers LSI Logic and Analog Devices, and software
developers Altera, Macromedia, and PeopleSoft have new products and applications
that are used in everything from large commercial networks to video games. SAP
remains the dominant provider of client-server business software.
Telecommunications. Advances in technology have expanded global demand
exponentially. Telecom companies can be divided into equipment manufacturers and
service providers. Nokia makes cellular phones and equipment. U.S. Robotics and
Ascend Communications supply high-speed communications products that facilitate
access to outside networks, such as the Internet. Service companies include
Paging Network, AirTouch, and Arch Communications in the U.S., and Millicom and
Swedish conglomerate Kinnevik in Europe. Kinnevik, which has underperformed this
year, intends to divide into four divisions. Like many conglomerates, Kinnevik's
parts are worth more than the whole.
Pharmaceutical Companies. The pipelines of drug manufacturers contain
products with enormous global applications. During the last half of the year we
sold our European holdings, Astra and Roche, as they approached full valuation,
and increased U.S. holdings in Amgen, Pfizer, Warner-Lambert, and Eli Lilly.
Financial Services. Financial stocks are not only benefiting from low
interest rates but are increasing productivity, streamlining operations, and
focusing on their more profitable business operations. Their discipline has
improved the quality of earnings substantially. Chase Manhattan and First
Interstate are participating in the current round of consolidation in the
banking industry. Citicorp, Merrill Lynch, and Chase are also buying back stock
in significant quantities.
GOING FORWARD
The prevailing environment for stocks remains extremely positive. Economic
growth is moderate, inflation is tame, and interest rates have continued lower.
Given the current low level of interest rates, stock market valuations appear
reasonable and we are finding many good individual opportunities.
Thank your for your investment in Janus Mercury Fund.
Janus Funds October 31, 1995 Annual Report
16
<PAGE>
JANUS MERCURY FUND Portfolio Manager, Warren B. Lammert
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Mercury Fund and the S&P 500 Index. Janus Mercury Fund is represented
by a solid green line and the S&P 500 Index is represented by a single dashed
black line. The "y" axis reflects the value of the investment. The "x" axis
reflects the computation periods from inception, May 3, 1993, through October
31, 1995. The upper right quadrant reflects the ending value of the hypothetical
investment in Janus Mercury Fund ($17,724) as compared to the S&P 500 Index
($14,153). There is a legend in the upper left quadrant of the graph which
indicates Janus Mercury Fund's one-year and since inception (May 3, 1993)
average annual total returns as 25.53% and 25.73%, respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the index.
The index is unmanaged.
JANUS MERCURY FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 83.2%
Auto Parts - Replacement - 0.2%
149,325 APS Holding Corp. - Class A* $ 3,061,162
Biopharmaceuticals - 2.6%
814,600 Amgen, Inc.* 39,100,800
Broadcasting, Radio and Television - 0.4%
260,100 Central European Media Enterprises, Ltd.# 5,982,300
Chemicals - 0.4%
40,250 IMC Global, Inc. 2,817,500
226,250 Schulman (A.), Inc. 4,242,188
7,059,688
Commercial Services - 1.4%
373,075 CUC International, Inc.* 12,917,722
109,675 Olsten Corp. 4,222,488
104,917 Securitas A.B. - Class B** 4,067,225
21,207,435
Computer Software and Services - 8.5%
161,500 Broderbund Software, Inc. 11,204,062
244,925 CIBER, Inc.*,# 5,235,272
336,775 Computer Associates International, Inc. 18,522,625
47,125 Computer Horizons Corp.* 1,225,250
522,900 First Data Corp. 34,576,762
154,675 General Motors Corp. - Class E 7,289,059
204,275 Keane, Inc.* 5,515,425
344 NTT Data Communications Systems Corp.** 8,632,033
296,600 PeopleSoft, Inc.* 25,507,600
305,200 Platinum Software Corp.* 2,021,950
241,500 Softkey International, Inc.* 7,607,250
123,850 Systemsoft Corp.* 1,780,344
129,117,632
Shares or
Principal Amount Market Value
- ---------------- ------------
Computers - 3.3%
30,000 Boca Research, Inc.* $ 757,500
399,750 Comverse Technology, Inc.* 9,094,313
513,350 Sun Microsystems, Inc.* 40,041,300
49,893,113
Electronics - 5.8%
221,625 Altera Corp.* 13,408,313
128,125 ITI Technologies, Inc.* 3,235,156
360,050 Itron, Inc.* 10,441,450
89,000 Kyocera Corp.*,** 7,310,527
507,050 Macromedia, Inc.* 18,760,850
166,325 Nokia Corp. (ADR) - Class A** 9,272,619
346,550 Pittway Corp. - Class A 20,749,681
73,200 StrataCom, Inc.* 4,501,800
87,680,396
Electronics - Semiconductors - 4.2%
1,003,325 Analog Devices, Inc.* 36,245,134
115,475 Cyrix Corp.* 3,695,200
417,850 LSI Logic Corp.* 19,691,181
202,675 VLSI Technology, Inc.* 4,762,862
64,394,377
Engineering and Construction - 1.1%
26,057 Metra Oy - A** 1,142,178
363,013 Metra Oy - B** 15,741,143
16,883,321
Entertainment - 0.4%
285,971 Thorn EMI PLC** 6,657,623
Environmental Control - 0.2%
71,600 United Waste Systems, Inc.* 2,828,200
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
17
<PAGE>
JANUS MERCURY FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Financial - Bank Commercial - 1.9%
168,350 Banco Industrial Colombiano (ADR) $ 2,293,769
203,625 First Interstate Bancorp 26,267,625
28,561,394
Financial - Bank Money Center - 3.6%
705,875 Chase Manhattan Corp. 40,234,875
215,925 Citicorp 14,008,134
54,243,009
Financial - Security Broker - 0.7%
198,750 Merrill Lynch and Co., Inc. 11,030,625
Financial Services - 0.5%
1,962,375 Grupo Financiero Inbursa S.A. - Class C* 5,364,566
124,675 North American Mortage Co. 2,571,422
7,935,988
Food Processing - 2.2%
257,585 Cultor OY - Series I** 10,562,484
269,469 Cultor OY - Series II** 11,176,807
388,083 Huhtamaki Group - Series I** 11,523,686
33,262,977
Forest Products and Paper - 4.4%
436,150 Bowater, Inc. 19,299,638
757,875 James River Corp. 24,346,734
207,044 Mo Och Domsjo A.B.** 10,555,980
39,180 Munksjo A.B.** 283,678
9,398,171 Rottneros Bruks A.B.*,#,** 12,475,135
66,961,165
Furniture and Home Appliances - 0.6%
152,175 Industrie Natuzzi S.p.A. (ADR) 6,087,000
145,450 Singer Company N.V. (The) 3,418,075
9,505,075
Holding Company - Diversified - 2.3%
1,269,344 Kinnevik A.B. - Class B** 35,230,306
Insurance - Life - 2.8%
234,450 Healthsource, Inc.* 12,425,850
582,375 UNUM Corp. 30,647,484
43,073,334
Insurance - Property and Casualty - 0.3%
95,625 Progressive Corp. 3,968,438
Iron and Steel - 0.2%
281,552 SSAB Svenskt Stal A.B. - Class A** 2,824,226
Leisure Time - 0.4%
178,000 Coleman Co., Inc.* 6,096,500
Lodging - 3.9%
926,375 HFS, Inc.* 56,740,469
123,325 La Quinta Inns, Inc. 3,175,619
59,916,088
Machine - Diversified - 1.4%
422,350 American Standard Companies, Inc.* 11,297,863
66,762 IRO A.B.+,** 815,706
25,509 Sidel S.A.** 8,876,241
20,989,810
Medical - Hospital Management Services - 1.5%
25,000 Laser Vision Centers, Inc.* 378,125
301,725 PacifiCare Health Systems, Inc. - Class B* 21,950,494
22,328,619
Shares or
Principal Amount Market Value
- ---------------- ------------
Medical Supplies - 2.3%
86,000 Corvita Corp.* $ 688,000
130,075 I-Stat Corp.* 4,032,325
215,850 Nellcor Puritan Bennett, Inc.* 12,411,375
64,550 ResMed, Inc.* 968,250
333,150 Sofamor Danek Group, Inc.* 8,162,175
249,650 STERIS Corp.* 8,425,688
34,687,813
Metals - Diversified - 0.3%
77,700 Phelps Dodge Corp. 4,924,237
Mining - 1.9%
222,754 Freeport McMoRan, Inc. 8,325,437
294,705 Potash Corporation of Saskatchewan, Inc. 20,518,836
28,844,273
Miscellaneous - Distribution and Wholesale - 0.2%
119,156 Brightpoint, Inc. 2,263,969
71,350 Grupo Casa Autrey, S.A. de C.V. (ADR) 909,713
3,173,682
Miscellaneous - Manufacturing - 0.1%
116,517 Assa-Abloy A.B. - Class B*,** 773,323
Packaging and Containers - 2.7%
1,179,650 Crown Cork & Seal Co., Inc.* 41,140,294
Pharmaceuticals - 6.5%
289,300 Biochem Pharma, Inc.* 11,065,725
210,675 Lilly (Eli) and Co.* 20,356,472
461,350 Pfizer, Inc. 26,469,956
576,653 SmithKline Beecham PLC - Class A** 6,019,797
405,500 Warner-Lambert Co. 34,518,188
98,430,138
Publishing - Newspaper - 0.1%
25,900 Reuters Holdings PLC (ADS) 1,437,450
Publishing and Printing - 1.1%
816,950 News Corp., Ltd. (ADR) 16,236,881
Real Estate Investment Trust - 0.1%
171,075 Sunstone Hotel Investors, Inc. 1,539,675
Restaurants and Food Service - 0.1%
81,901 Wetherspoon (J.D.) PLC** 824,561
Telecommunications - 4.7%
147,848 Arch Communications Group, Inc.* 4,010,396
156,650 CommNet Cellular, Inc.* 3,935,831
123,284 Korea Mobile Telecommunications, Inc.*,+ 4,530,687
294,575 Millicom International Cellular S.A.* 9,720,975
545,090 Nordictel Holdings A.B.*,** 6,166,642
1,044,800 Paging Network, Inc.* 24,030,400
2,329,992 Telecom Italia S.p.A.* 3,578,516
391,350 Telecomunicacoes Brasileiras S.A. (ADR) 15,654,000
71,627,447
Telecommunications Equipment - 6.1%
125,000 Applied Digital Access, Inc.* 1,500,000
188,500 Ascend Communications, Inc.* 12,252,500
628,632 Nokia A.B. - Class A** 35,999,711
194,650 PictureTel Corp.* 12,846,900
329,975 U.S. Robotics Corp.* 30,522,688
93,121,799
Tobacco - 0.9%
1,482,000 PT Hanjaya Mandala Sampoerna* 13,710,132
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
18
<PAGE>
JANUS MERCURY FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Utilities - Telecommunications - 0.7%
2,329,992 Telecom Italia Mobile S.p.A.* $ 3,928,748
169,800 Telephone and Data Systems, Inc. 6,792,000
10,720,748
Wine and Spirits - 0.2%
69,075 Canandaigua Wine Co., Inc. - Class A* 3,315,600
Total Common Stock (cost $1,143,929,907) 1,264,301,654
Preferred Stock - 4.2%
Computer Software and Services - 4.1%
414,379 SAP A.G.** 63,555,967
Retail - Special Line - 0.1%
4,121 Moebel Walther A.G.** 1,902,045
Total Preferred Stock (cost $43,706,567) 65,458,012
U.S. Government Agencies - 1.6%
$ 10,000,000 Federal Home Loan Bank System
5.63%, 11/21/95 9,968,722
15,000,000 Federal National Mortgage Association
5.67%, 11/10/95 14,978,738
Total U.S. Government Agencies (amortized cost $24,947,460) 24,947,460
Shares or
Principal Amount Market Value
- ---------------- ------------
Money Market - 2.3%
$ 5,000,000 Janus Government Money Market Fund, 5.85% $ 5,000,000
29,700,000 Janus Money Market Fund, 5.90% 29,700,000
Total Money Market (cost $34,700,000) 34,700,000
Short-Term Corporate Notes - 6.5%
73,700,000 General Electric Capital Corp.
5.83%, 11/1/95 73,700,000
25,000,000 Household Finance Corp.
5.72%, 11/10/95 24,964,250
Total Short-Term Corporate Notes
(amortized cost $98,664,250) 98,664,250
Total Investments - 97.8% (total cost $1,345,948,184) 1,488,071,376
Cash, Receivables and Other Assets, net of Liabilities - 2.2% 32,697,050
Net Assets - 100% $1,520,768,426
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Mercury Fund British Pound 3/28/96 7,248,000 $ 11,417,774 $ (38,414)
Finnish Markka 1/11/96 114,057,000 26,921,189 (383,962)
Finnish Markka 1/25/96 67,900,000 16,030,787 (240,089)
Finnish Markka 2/8/96 59,520,000 14,054,973 36,937
Finnish Markka 2/12/96 99,947,000 23,602,465 17,291
Finnish Markka 3/28/96 35,992,000 8,503,922 (201,269)
French Franc 3/28/96 30,648,000 6,266,075 (31,104)
German Deutschemark 12/14/95 27,500,000 19,578,528 (23,451)
German Deutschemark 1/11/96 4,483,000 3,196,207 40,850
German Deutschemark 2/8/96 7,292,000 5,205,968 16,405
German Deutschemark 2/12/96 9,630,000 6,876,607 20,933
German Deutschemark 3/28/96 34,385,000 24,602,891 (1,250,349)
Japanese Yen 2/8/96 375,000,000 3,673,096 54,908
Japanese Yen 3/14/96 1,315,000,000 12,880,968 622,199
Swedish Krona 11/9/95 90,972,000 13,719,612 (941,748)
Swedish Krona 11/21/95 90,000,000 13,558,301 (1,050,031)
Swedish Krona 1/11/96 160,665,000 24,116,269 (2,367,000)
$234,205,632 $(5,717,894)
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
19
<PAGE>
JANUS OVERSEAS FUND Portfolio Manager, Helen Young Hayes
PERFORMANCE REVIEW
Most overseas markets lagged the U.S. during the last twelve months. Janus
Overseas Fund performed well, gaining 11.78% during the fiscal year ended
October 31, 1995, versus a loss of 0.37% for the Morgan Stanley EAFE Index.
(EAFE stands for Europe, Australasia and the Far East.) Both returns are with
net dividends reinvested.(1)
For the twelve-month period, the Fund's total return ranked second out of
233 international funds tracked by Lipper Analytical Services, Inc., a mutual
fund rating company.(2)
Ideas That Worked. Good individual stock selection was the primary reason
Janus Overseas Fund bested the EAFE Index. Several European markets registered
new highs, but the Fund's European growth stocks outperformed the local markets.
Diverse names such as J.D. Wetherspoon (British pubs), Fielmann and Matahari
Putra Prima (German and Indonesian retailers), Elkjsp (Norwegian electronics),
and ASM Lithography (Dutch semiconductors) were among companies that enjoyed
excellent price moves. In the U.S., HFS (lodging) also gained more than the
broad market.
We Might Have Done Better. Swedish conglomerate Kinnevik, one of our
largest holdings, did not have a good year. Softness in the Scandinavian
television market and one-time writedowns made for disappointing earnings. But
Kinnevik is moving to increase shareholder value. It intends to break the
company into four divisions. Like many conglomerates, Kinnevik's parts are worth
more than its whole. Currency hedging, although moderate, also constrained
performance early in the year when the dollar declined to historic lows against
the Japanese yen and German mark. Finally, Olivetti was sold after it announced
a stock offering that would have diluted earnings.
PORTFOLIO COMPOSITION
The Fund was approximately 83% invested in equities at the end of October,
with 47.6% of assets invested in Europe and 26.1% in the Pacific Rim. The
investment in Japan was increased during the final quarter, when the dollar
bottomed out definitively against the yen and the Japanese economy showed signs
of acceleration. The five countries where we have the largest investments
totaled 52.0% of assets. The ten largest holdings made up 22% of assets.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
SAP AG 3.0% --
Kinnevik 2.6% 5.4%
Roche Holdings 2.3% --
Ciba-Geigy 2.1% --
NTT Data 2.1% --
Securitas 2.1% --
PT Hanjaya Mandala Sampoerna 2.0% --
Astra 2.0% 5.0%
Getronics 1.9% --
Hitachi 1.9% --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Pharmaceuticals 9.1% 14.9%
Computer Software and Services 8.2% --
Commercial Services 5.2% --
Holding Companies - Diversified 4.5% 5.4%
Telecommunications 4.1% 24.3%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Countries October 31, 1995 October 31, 1994
Japan 17.7% 4.5%
Sweden 14.3% 22.1%
Germany 9.1% 6.6%
Switzerland 6.9% --
United States(3) 5.1% 2.7%
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Telecommunications. Inexpensive cellular products and services have created
an extremely powerful demand cycle globally, but in some areas, such as Japan,
where we own DDI, an independent Japanese long-distance provider, the cycle is
still in its early stages. In Europe, Kinnevik and cellular manufacturer Nokia
have strong competitive positions. Other formidable competitors include Millicom
in the emerging markets of Asia and Latin America, and Telecommunicacoes Brazil
and Korea Mobile Telecom in their respective regions.
Multinational Pharmaceuticals. A number of drug companies have products
with enormous potential. In Europe, Astra, Roche, Ciba-Geigy, and Sandoz all are
either marketing or developing products that have changed or will change the
treatment of many widespread diseases. Two of the most exciting are Astra's
Losec, which is the best-selling ulcer treatment in Europe, and Sandoz's new
treatment for Alzheimer's, which is in development.
Technology-Related. Technology continues to create new and powerful
applications for computers and telecommunications. SAP has a fully integrated
business software applications package that ties together accounting, human
resources, logistics, and manufacturing. Getronics, Frontec, and JBA Holdings
are software consulting firms that fill an exploding demand for custom networks
and systems. ASM Lithography and Rohm manufacture semiconductors and other
electronic components.
Outsourcing. When it comes to complex operations, especially in computers
and data processing, it is often more cost-effective to use outside specialists.
In Japan, DDI and NTT Data Communication Systems manage information and process
data. In Sweden, Securitas provides security personnel.
INTERNATIONAL STRATEGY
Janus Overseas Fund invests in individual companies with good earnings
prospects that sell in the market at a discount to their growth potential. We
continue to find many such opportunities in markets worldwide.
Thank you for your investment in Janus Overseas Fund.
- -------------------------
(1) Net dividends reinvested are the dividends that remain to be reinvested
after foreign tax obligations have been met. Such obligations vary from
country to country.
(2) An International Fund is defined by Lipper Analytical Services as one
"which invests its assets in securities whose primary trading markets are
outside the United States." This ranking is based on total return,
including reinvestment of dividends and capital gains for the stated
period. Past performance is not predictive of future results.
(3) Not including short-term securities.
Janus Funds October 31, 1995 Annual Report
20
<PAGE>
JANUS OVERSEAS FUND Portfolio Manager, Helen Young Hayes
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Overseas Fund and the MSCI EAFE Index. Janus Overseas Fund is
represented by a solid green line and the MSCI EAFE Index is represented by a
single dashed black line. The "y" axis reflects the value of the investment. The
"x" axis reflects the computation periods from inception, May 2, 1994, through
October 31, 1995. The upper right quadrant reflects the ending value of the
hypothetical investment in Janus Overseas Fund ($11,580) as compared to the MSCI
EAFE Index ($10,350). There is a legend in the upper left quadrant of the graph
which indicates Janus Overseas Fund's one-year and since inception (May 2, 1994)
average annual total returns as 11.78% and 10.27%, respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the index.
The index is unmanaged.
JANUS OVERSEAS FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 78.0%
Aerospace and Defense - 0.7%
100,000 Mitsubishi Heavy Industries, Ltd.** $ 773,378
Agriculture - 0.8%
645,000 PT Sekar Bumi* 852,423
Auto and Truck - 2.4%
27,900 Bajaj Auto, Ltd. (GDR)*,+ 753,300
5,947 Volkswagen A.G.** 1,872,821
2,626,121
Brewery - 0.9%
2,197,000 CIA Cervejaria Brahma 838,672
13,675 Erciyas Biracilik Ve Malt Sanayii (GDR)*,+ 173,303
1,011,975
Broadcasting, Radio and Television - 1.2%
1,925 Bell Cablemedia PLC (ADR)* 28,634
34,219 Central European Media Enterprises, Ltd. 787,037
1,575 Grupo Televisa S.A. de C.V.(GDR) 26,972
4,500 NYNEX CableComms Group, Inc. (ADR)* 90,563
12,725 Scandinavian Broadcasting System S.A.* 305,400
2,250 TeleWest PLC (ADR)* 62,438
1,301,044
Building Materials - 0.3%
133,000 PT Semen Cibinong 348,612
Chemicals - 0.1%
6,614 Reliance Industries (GDS)* 103,311
Closed End Funds - 0.1%
11,900 NIS Regional Fund*,+ 74,970
Shares or
Principal Amount Market Value
- ---------------- ------------
Commercial Services - 5.2%
8,898 Grand Optical Photoservice** $ 953,657
58,877 Securitas A.B. - Class B** 2,282,433
42,426 Sysdeco Group A.S.* 946,887
42,623 WM-Data A.B. - Class B** 1,568,748
5,751,725
Computer Software and Services - 5.2%
45,047 Getronics N.V. 2,149,854
207,986 JBA Holdings PLC** 1,268,866
93 NTT Data Communications Systems Corp.** 2,333,660
5,752,380
Computers - 1.7%
54,236 Frontec A.B. - Class B*,** 1,308,961
12,000 Tokyo Electron, Ltd.** 522,251
1,831,212
Electrical Equipment - 1.9%
203,000 Hitachi, Ltd.** 2,089,296
Electronics - 3.3%
19,000 Kyocera Corp.*,** 1,560,674
6,000 Martin Gruppen* 322,929
4,300 Nokia Corp. (ADR) - Class A 239,725
10,600 Sony Corp.** 477,946
96,000 Victor Co. of Japan, Ltd.*,** 1,025,681
3,626,955
Electronics - Semiconductors - 1.4%
26,000 Rohm Co.** 1,582,631
Engineering and Construction - 0.8%
634 Metra Oy - A** 27,791
18,208 Metra Oy - B** 789,544
62,000 New World Infrastructure, Ltd.*,+ 109,070
926,405
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
21
<PAGE>
JANUS OVERSEAS FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Entertainment - 0.9%
42,209 Thorn EMI PLC** $ 982,658
Financial - Bank Commercial - 3.6%
25,000 Dai-Ichi Kangyo Bank, Ltd.** 423,936
49,142 Fokus Bank A.S.+ 260,386
95,600 HSBC Holdings PLC 1,391,188
41,000 Mitsui Trust and Banking Co., Ltd.*,** 328,739
31,485 Nordbanken A.B.*,** 470,173
44,000 Sakura Bank, Ltd.** 426,975
22,000 Sanwa Bank, Ltd.** 375,221
43,100 Thai Farmers Bank, Ltd. 356,312
4,032,930
Financial - Bank Money Center - 0.3%
31,000 Sumitomo Trust and Banking Co., Ltd.*,** 358,557
Financial - Savings/Loan/Thrift - 0.1%
15,044 Sparbanken Sverige A.B. - Class A** 158,848
Food Processing - 1.4%
39,429 Huhtamaki Group - Series I** 1,170,800
5,068 Nutricia Vereenigde Bedrijven N.V. 393,478
1,564,278
Forest Production and Paper - 0.2%
175,179 Rottneros Bruks A.B.*,** 232,533
Holding Companies - Diversified - 4.5%
28,949 C.G. Smith, Ltd. 188,548
510,000 First Pacific Co. 587,132
119,475 Grupo Carso S.A. de C.V. - Series A1* 636,297
101,000 Hutchison Whampoa, Ltd. 556,553
106,091 Kinnevik - Class B** 2,944,527
5,700 Malbak, Ltd.+(GDR) 37,050
59,000 Universal Robina Corp. 24,413
4,974,520
Household Products - 0.4%
12,000 Amway Japan, Ltd.** 458,734
Iron and Steel - 0.1%
12,144 SSAB Svenskt Stal A.B. - Class A** 121,816
Leisure Time - 0.2%
78,700 Tabcorp Holdings, Ltd.* 218,314
Lodging - 2.3%
8,774 Accor S.A.** 1,044,652
23,600 Hospitality Franchise Systems, Inc.* 1,445,500
2,490,152
Machine - Diversified - 1.4%
31,900 ASM Lithography Holding N.V.* 1,572,962
Medical Supplies - 2.6%
39,700 De Rigo S.p.A. (ADR)* 818,813
44,667 Elekta Instrument A.B.*,** 1,852,843
3,078 Getinge Industrier A.B. - Class B** 131,394
4,134 Scandinavian Mobility International*,+ 98,383
2,901,433
Metals - Diversified - 0.9%
38,126 Hoganas A.B. - Class B** 1,029,422
Mining - 1.5%
21,950 Petroleum Geo - Services A/S (ADR)* 425,281
18,549 SGL Carbon A.G.*,+,** 1,215,702
1,640,983
Miscellaneous - Distribution and Wholesale - 0%
325 Amway Asia Pacific, Ltd. 10,644
Shares or
Principal Amount Market Value
- ---------------- ------------
Miscellaneous - Manufacturing - 2.0%
108,729 Assa-Abloy A.B. - Class B*,** $ 721,635
8,902 Barco N.V. 1,002,748
9,157 Orkla A/S - Class A 473,435
2,197,818
Office and Business Equipment- 2.6%
118,000 Canon, Inc.** 2,024,113
14,613 Oce-Van Der Grinten N.V. 838,178
2,862,291
Pharmaceuticals - 9.1%
59,341 Astra A.B. - Class A** 2,184,057
2,769 Ciba-Geigy Corp. A.G.** 2,388,750
355 Roche Holding A.G.** 2,578,125
2,239 Sandoz A.G. - Class R** 1,862,548
23,000 Sankyo Co., Ltd.** 507,253
24,000 Yamanouchi Pharmaceutical Co., Ltd.*,** 536,365
10,057,098
Publishing and Printing - 1.2%
118,219 News Corp., Ltd. 594,783
39,400 News Corp., Ltd. (ADR) 783,075
1,377,858
Real Estate - 1.3%
1,218,000 Henderson Investment, Ltd. 992,575
39,000 Mitsui Fudosan Co.*,** 447,265
1,439,840
Restaurants and Food Service - 1.1%
118,712 Wetherspoon (J.D.) PLC** 1,195,167
Retail - Department Stores - 1.0%
532,000 PT Matahari Putra Prima 1,113,216
Retail - General Merchandise - 0.2%
17,000 Pao De Acucar S.A.+ 178,500
Retail - Grocery - 0.4%
9,000 Ito-Yokado Co., Ltd.** 493,139
Retail - Specialty Line - 1.5%
26,131 Elkjop Norge A.S. 671,317
3,170 Interdiscount Holding, Ltd.*,** 362,764
7,535 OMV A.G.* 650,487
1,684,568
Telecommunications - 4.1%
15,087 Korea Mobile Telecommunications, Inc.*,+ 554,447
60,500 Millicom International Cellular S.A.* 1,996,500
49,300 Paging Network, Inc.* 1,133,900
21,828 Telecomunicacoes Brasileiras S.A. 873,120
2,250 Videotron Holdings PLC (ADR)* 29,672
4,587,639
Telecommunications Equipment - 0.8%
15,958 Nokia A.B. - Class A** 913,863
Tobacco - 2.0%
238,000 PT Hanjaya Mandala Sampoerna* 2,201,762
Utilities - Electric - 0.9%
19,975 Cemig S.A. (ADR)* 434,456
286,786 Consolidated Electric Power Asia, Ltd. 580,561
1,015,017
Utilities - Telecommunications - 2.1%
222 DDI Corp.** 1,803,940
67,216 Telecom Italia Mobile S.p.A.* 113,337
22,793 Telefonica De Espana S.A.** 287,833
2,800 Telefonica De Espana S.A. (ADR) 105,350
2,310,460
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
22
<PAGE>
Shares or
Principal Amount Market Value
- ---------------- ------------
Wholesale - Special Line - 1.3%
2,905 Gehe A.G.** $ 1,425,374
Total Common Stock (cost $77,915,836) 86,454,832
Preferred Stock - 5.0%
Computer Software and Services - 3.0%
21,915 SAP A.G.** 3,361,244
Financial - Bank Commercial - 0%
384,000 Banco Bradesco S.A. 3,595
Medical - Supplies - 0.2%
238 Fresenius A.G.** 190,123
Publishing and Printing - 0.1%
31,239 News Corp., Ltd. 142,450
Retail - Special Line - 1.4%
27,816 Fielmann A.G.*,** 1,530,739
Telecommunications - 0%
5,000 Telecomunicacoes Brasileiras S.A. 203
Utilities - Electric - 0.3%
1,201,000 Centrais Electricas Brasileiras S.A. - Class B 342,286
Total Preferred Stock (cost $4,233,081) 5,570,640
U.S. Government Agencies - 7.2%
Federal Home Loan Bank System:
$ 4,000,000 5.64%, 11/8/95 3,995,613
1,000,000 5.62%, 11/10/95 998,595
Federal National Mortgage Association:
3,000,000 5.64%, 11/15/95 2,993,420
Total U.S. Government Agencies (amortized cost $7,987,628) 7,987,628
Short-Term Corporate Note - 4.4%
Ford Motor Credit Corp.
4,900,000 5.85%, 11/1/95 4,900,000
(amortized cost $4,900,000)
Total Investments - 94.6% (total cost $95,036,545) 104,913,100
Cash, Receivables and Other Assets, net of Liabilities - 5.4% 5,953,320
Net Assets - 100% $110,866,420
SUMMARY OF INVESTMENTS BY COUNTRY
October 31, 1995
Country % of Investment Securities Market Value
- ------- -------------------------- ------------
Austria 0.6% $ 650,487
Australia 1.7% 1,738,622
Belgium 1.0% 1,002,748
Brazil 2.6% 2,733,270
Denmark 0.4% 421,312
Finland 3.0% 3,141,723
France 1.9% 1,998,309
Germany 9.1% 9,596,004
Hong Kong 4.0% 4,217,079
India 0.8% 856,611
Indonesia 4.3% 4,516,013
Italy 0.9% 932,150
Japan 17.7% 18,560,397
Korea 0.5% 554,447
Luxembourg 0.3% 305,400
Mexico 0.6% 663,269
Netherlands 4.7% 4,954,472
Norway 2.6% 2,777,306
Philippines 0.0% 24,413
Russia 0.1% 74,970
South Africa 0.2% 225,598
Spain 0.4% 393,183
Sweden 14.3% 15,007,390
Switzerland 6.9% 7,192,187
Thailand 0.3% 356,312
Turkey 0.2% 173,303
United Kingdom 4.2% 4,382,597
United States+ 16.7% 17,463,528
Total 100.0% $104,913,100
- --------------------------------------------------------------------------------
+ Includes Short-Term Securities
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Overseas Fund British Pound 1/25/96 1,108,000 $ 1,747,981 $ 2,107
Finnish Markka 11/9/95 4,751,000 1,120,149 8,631
Finnish Markka 1/25/96 3,000,000 708,282 (10,608)
French Franc 12/14/95 2,000,000 409,526 (15,910)
French Franc 3/14/96 5,700,000 1,165,597 (36,213)
German Deutschemark 1/25/96 9,623,000 6,865,725 (36,945)
Japanese Yen 11/21/95 160,000,000 1,566,988 211,540
Japanese Yen 1/25/96 72,821,000 713,261 71,411
Japanese Yen 2/8/96 650,000,000 6,366,700 689,500
Japanese Yen 3/14/96 270,000,000 2,644,762 83,532
Spanish Peseta 1/25/96 31,539,000 256,291 2,926
Swedish Krona 11/9/95 27,606,000 4,163,299 (285,779)
Swedish Krona 11/21/95 27,500,000 4,142,814 (320,843)
Swedish Krona 1/25/96 21,000,000 3,149,276 (313,737)
Swiss Franc 11/9/95 1,671,000 1,472,895 (26,080)
$36,493,546 $ 23,532
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
23
<PAGE>
JANUS TWENTY FUND Portfolio Manager, Thomas F. Marsico
PERFORMANCE REVIEW
The powerful rally in U.S. stocks continued through most of our fiscal year
ended October 31, 1995. The environment for growth stocks remains excellent,
which contributed to Janus Twenty Fund's solid performance. The Fund returned
24.67% for the twelve-month period, while the S&P 500 Index gained 26.44%. Both
returns include reinvested dividends.
Much of the Fund's underperformance was during the last two months of 1994.
During calendar 1995 (January-October), Janus Twenty Fund produced a total
return of 32.67% versus 29.30% for the S&P 500 Index. Late in 1994, some of our
positions did not appreciate in lockstep with the market. Instead they
outperformed later in 1995. Health care stocks, especially HMOs, underperformed,
and we had several earnings disappointments with home-improvement chain Lowe's,
packaging manufacturer Crown Cork & Seal, and casino-owner Circus Circus.
Janus Twenty Fund's portfolio became more aggressive during the second half
of 1994. We added or increased faster-growing technology and telecommunications
stocks such as Texas Instruments, Microsoft, and Nokia, dominant multinationals
Citicorp and SAP, and outsourcers EDS (General Motors E) and First Data. Our
selection of technology stocks contributed to performance, although overall
exposure to this volatile sector remained moderate compared to other growth
mutual funds. Our pharmaceutical holdings, including Pfizer and Roche, also
worked in a big way. We showed patience with financial stocks. First Interstate
Bancorp and recent addition Chemical Banking are now benefiting from
consolidating operations internally, through new efficiencies, and externally,
through acquisitions.
PORTFOLIO COMPOSITION
As of year end, the portfolio was 96% invested in stocks, versus 92.7% when
the year began. Foreign stocks accounted for 13.9% of assets, versus 7.4% at the
end of October 1994, and are still mostly European. The portfolio remains
concentrated: at year end, the ten largest holdings were 47.3% of assets, and
the top twenty holdings equaled 72.7%.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
Sun Microsystems 6.8% --
Citicorp 5.9% 4.3%
Chemical Banking 5.6% --
Merrill Lynch 4.6% 5.2%
Amgen 4.7% 2.9%
Federal National Mortgage Assoc 4.2% 4.2%
Merck 4.2% --
Roche Holdings 3.9% --
Pfizer 3.8% 2.9%
First Data Corp. 3.6% 5.7%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Pharmaceuticals 15.2% 2.9%
Financial - Bank Money Center 11.5% 4.3%
Electronics-Semiconductors 9.8% 2.6%
Computer Software and Services 9.2% 6.0%
Computers 7.6% 4.0%
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Multinationals. Large multinational companies have an excellent competitive
position in increasingly integrated global markets. Coca-Cola, Pfizer,
Microsoft, Citicorp, Merrill Lynch, SAP, and Roche each essentially owns a
global franchise because many of their products have brand name recognition
internationally.
Technology. Although positions were selectively reduced late in the year,
we continue to hold this sector. Technology is creating powerful new products
(Windows 95 and Pentium are two recent examples) with multiple new and far
reaching applications (such as the Internet). Sun Microsystems is the preferred
provider of commercial equipment for the Internet, and Texas Instruments is
developing a new video display technology for television that has the potential
to redefine a technology that is basically unchanged since the 1950s.
Outsourcing. Outside specialists, especially in computer operations and
data processing, are increasingly cost-effective. Data processor EDS (General
Motors E) is being spun off by General Motors. First Data has recently acquired
competitor First Financial Management, and is now the largest credit card
transaction processor for both banks and merchants.
Pharmaceuticals. Amgen, Pfizer, Roche, and Merck have products on the
market or in development with enormous international potential. New drug
therapies are being developed for diseases such as osteoporosis, Alzheimer's,
and diabetes.
Financial Services. Merrill Lynch, Citicorp, Chemical Banking are all
benefiting from more efficient operations and fast-growing international
markets. Federal National Mortgage Association has a secure franchise in the
domestic mortgage market for low-cost housing.
Stock Repurchase. Companies that wish to enhance shareholder value are
repurchasing stock. Share repurchase can indicate that a company intends to
focus on what it does best, i.e., its most profitable operations. Citicorp,
Merrill Lynch, Sun Microsystems, PepsiCo, and Chemical Banking are but a few of
our holdings that have significant stock repurchase programs.
CURRENT STRATEGY
As we enter a new year, the Fund is positioned to take advantage of the
positive environment for growth stocks. We may experience additional volatility
after such a strong year in 1995, but if the current economic conditions
prevail, stocks should also perform in 1996.
JANUS TWENTY FUND HAS REOPENED
We are pleased to announce that Janus Twenty Fund reopened to new investors
on November 1, 1995. Since the Fund was closed in January 1993, markets have
expanded enormously both in terms of liquidity and exciting investment
opportunities.
Thank you for your investment in Janus Twenty Fund.
Janus Funds October 31, 1995 Annual Report
24
<PAGE>
JANUS TWENTY FUND Portfolio Manager, Thomas F. Marsico
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Twenty Fund and the S&P 500 Index. Janus Twenty Fund is represented by
a solid green line and the S&P 500 Index is represented by a single dashed black
line. The "y" axis reflects the value of the investment. The "x" axis reflects
the computation periods from inception, April 30, 1985, through October 31,
1995. The upper right quadrant reflects the ending value of the hypothetical
investment in Janus Twenty Fund ($45,375) as compared to the S&P 500 Index
($45,065). There is a legend in the upper left quadrant of the graph which
indicates Janus Twenty Fund's one-year, five-year, ten-year and since inception
(April 30, 1985) average annual total returns as 24.67%, 19.54%, 15.63% and
15.49%, respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the index.
The index is unmanaged.
JANUS TWENTY FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 91.2%
Aerospace and Defense - 1.1%
506,125 Lockheed Martin Corp. $ 34,479,766
Beverages - 6.1%
1,304,600 Coca-Cola Co. 93,768,125
1,704,000 PepsiCo, Inc. 89,886,000
183,654,125
Biopharmaceuticals - 4.7%
2,912,900 Amgen, Inc.* 139,819,200
Computer Software and Services - 5.5%
714,000 Cisco Systems, Inc.* 55,335,000
1,645,850 First Data Corp. 108,831,831
164,166,831
Computers - 7.6%
425,000 Compaq Computer Corp.* 23,693,750
2,629,475 Sun Microsystems, Inc.* 205,099,050
228,792,800
Electronics - 1.0%
143,800 Altera Corp.* 8,699,900
362,200 Nokia Corp. (ADR) - Class A** 20,192,650
28,892,550
Electronics - Semiconductors - 9.8%
644,750 Intel Corp. 45,051,906
879,450 LSI Logic Corp.* 41,444,081
867,150 Micron Technology, Inc. 61,242,469
2,066,850 National Semiconductor Corp.* 50,379,469
1,386,050 Texas Instruments, Inc. 94,597,913
292,715,838
Entertainment - 3.1%
1,599,200 Walt Disney Co. (The) 92,153,900
Shares or
Principal Amount Market Value
- ---------------- ------------
Financial - Bank Commercial - 2.5%
957,100 First Bank System, Inc. $ 47,615,725
221,800 First Interstate Bancorp 28,612,200
76,227,925
Financial - Bank Money Center - 11.5%
2,950,550 Chemical Banking Corp. 167,812,531
2,716,875 Citicorp 176,257,266
344,069,797
Financial - Security Broker - 5.4%
2,440,300 Merrill Lynch and Co., Inc. 135,436,650
1,098,550 Schwab (Charles) Corp. 25,129,331
160,565,981
Financial Services - 4.2%
1,211,425 Federal National Mortgage Association 127,048,197
Forest Products and Paper - 3.1%
690,550 Champion International Corp. 36,944,425
684,975 Georgia-Pacific Corp. 56,510,438
93,454,863
Insurance - Life - 1.0%
539,000 United Healthcare Corp. 28,634,375
Machine - Diversified - 1.1%
633,800 Applied Materials, Inc.* 31,769,225
Metals - Diversified - 1.5%
733,425 Phelps Dodge Corp. 46,480,809
Pharmaceuticals - 15.2%
899,389 Astra A.B. - Class A 33,102,182
2,208,475 Merck & Co., Inc. 126,987,312
2,006,820 Pfizer, Inc. 115,141,298
16,000 Roche Holding A.G.** 116,197,183
6,101,290 SmithKline Beecham PLC - Class A 63,692,601
455,120,576
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
25
<PAGE>
JANUS TWENTY FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Publishing - Newspaper - 0.7%
382,275 Reuters Holdings PLC (ADS) $ 21,216,263
Restaurants and Food Services - 2.1%
1,640,065 Lone Star Steakhouse & Saloon, Inc.*,# 63,347,511
Retail - Apparel - 1.4%
972,025 Fila Holdings S.p.A. (ADR) 41,918,578
Telecommunications Equipment - 1.1%
343,750 U.S. Robotics, Inc.* 31,796,875
Utilities - Telecommunications - 1.5%
1,524,450 Pacific Telesis Group 46,305,169
Total Common Stock (cost $2,326,679,671) 2,732,631,154
Preferred Stock - 4.8%
Computer Software and Services - 3.7%
572,870 SAP A.G.** 87,864,744
475,000 SAP A.G. (ADR)#,+,** 24,046,875
111,911,619
Financial Services - 1.1%
581,000 American Express Co. Exchange Notes, 6.25%
(Debt Exchangeable for Common Stock) 31,882,375
Total Preferred Stock (cost $93,767,610) 143,793,994
Shares or
Principal Amount Market Value
- ---------------- ------------
Corporate Bonds - 1.2%
$ 39,860,000 M.D.C. Holdings, Inc., 11.125%
senior notes, due 12/15/03 $ 37,269,100
(cost $36,354,073)
Money Market - 0.4%
11,000,000 Janus Money Market Fund, 5.90% 11,000,000
(cost $11,000,000)
Short-Term Corporate Note - 1.7%
Household Finance Corp.
50,500,000 5.82%, 11/1/95 50,500,000
(amortized cost $50,500,000)
Total Investments - 99.3% (total cost $2,518,301,354) 2,975,194,248
Cash, Receivables and Other Assets, net of Liabilities - 0.7% 20,557,173
Net Assets - 100% $2,995,751,421
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Twenty Fund Finnish Markka 11/21/95 114,000,000 $ 26,882,988 $ (850,836)
German Deutschemark 11/17/95 31,668,000 22,513,863 (589,948)
German Deutschemark 4/11/96 55,000,000 39,378,535 (498,286)
German Deutschemark 4/25/96 27,800,000 19,916,894 187,970
Swiss Franc 11/17/95 28,764,159 25,378,648 (1,231,030)
Swiss Franc 11/20/95 25,439,768 22,453,459 (961,773)
Swiss Franc 2/20/96 30,035,000 26,773,934 (1,970,070)
Swiss Franc 4/11/96 35,000,000 31,362,007 (611,700)
$214,660,328 $(6,525,673)
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
26
<PAGE>
JANUS VENTURE FUND Portfolio Managers, James P. Goff, Warren B. Lammert
PERFORMANCE REVIEW
Moderate economic growth, low inflation, and declining interest rates
continued to provide an excellent environment for equities during the fiscal
year ended October 31, 1995. Small stock indexes posted new records, but
overall, larger issues still produced better returns. Janus Venture Fund gained
19.24% for the twelve-month period, compared to 18.35% for the Russell 2000.
Both returns include reinvested dividends.
The Fund outperformed the Index because a number of its technology,
medical, financial, and telecommunications holdings met or exceeded earnings
estimates. Though technology holdings remain relatively modest compared to many
of its competitors, the Fund focused a bit more on technology than in the past,
while maintaining its diversified investment approach. We also selected some
excellent individual performers in diverse industries. Papa John's International
(pizza delivery), Heritage Media (radio stations), Lydall (filters and gaskets),
J.D. Wetherspoon (British pubs), and United Waste Systems (waste management) all
performed well. Portfolio diversification continued to offset the risk of
investing in smaller and less market-tested companies.
We could have done better with some of our manufacturing companies and with
selected European holdings. Exide, APS Holdings, U.S. Can, and Westinghouse
Airbrake (railroad brakes) have yet to meet expectations. In Europe, Swedish
paper companies Munksjoe, Repap Enterprises, and Rottneros were disappointing.
COMPOSITION OF THE PORTFOLIO
As of October 31, the Fund was 93.9% invested in equities, up from 88.4%
when the year began. The current high percentage of investment reflects the many
good individual ideas we are finding and the positive business climate for
smaller companies. Foreign stocks make up a moderate 11.0% of assets, with 10.8%
invested in Europe. The ten largest positions account for 28.7% of assets and
are an eclectic group, which is the result of our stock-by-stock approach to
portfolio management.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
Paging Network 4.3% 3.0%
Wisconsin Central 4.2% 4.3%
R.P. Scherer 3.7% 2.8%
SAP AG 3.3% 1.7%
Minerals Technology 2.9% 2.7%
Exide 2.8% 4.3%
First Empire State 2.2% 2.2%
Arch Communications 2.0% --
Nokia 1.7% 8.6%
Papa John's International 1.6% 1.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Computer Software and Services 12.1% --
Telecommunications 11.3% --
Medical Supplies 7.0% --
Auto Parts - Replacement 4.3% --
Pharmaceuticals 5.1% 3.1%
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Technology-Related. New, more powerful products have been driving the
industry. Product applications have exploded as a result, particularly in
telecommunications, manufacturing, and computer networking. Companies that
started in the small- to mid-cap category have quickly grown into large
companies. German software provider SAP has more than doubled since we first
began buying the stock eighteen months ago. Software and systems developers
Macromedia, Softkey, Getronics, and Mobilemedia are benefiting from new
applications demand, as are semiconductor manufacturers LSI Logic, Itron, VLSI
Technology, and Analog Devices.
Telecommunications. Advances in equipment and systems have put cellular
communications within the reach of most consumers. Nokia is a Finnish maker of
cellular equipment and telephones that has 20% of the international cell phone
market. Commnet Cellular provides cellular service in the U.S., and a suite of
stocks - Paging Network, Arch Communications, Heartland Wireless, Metrocall, and
Metricom - offer wireless paging and data transmission services.
Outsourcers. Operations such as data processing, computer services, and
personnel are often more cost-effective when provided by outsourcers such as
Keane, Analysts International, Medaphis, Fiserv, Technology Solutions and
Olsten.
Medical and Pharmaceuticals. This sector continues to develop exciting new
equipment, systems, and treatments, many of which have enormous market
potential. R.P. Scherer and TheraTech make drug delivery products. Sofamor
Danek, Nellcor, Isolyser, Target Therapeutics, and Steris manufacture and market
equipment.
Financial Services. Low interest rates have created loan demand at a time
when this group, which includes insurance companies, is also increasing
efficiency. First Empire State, a long-time bank holding, continues to perform
well. Klamath First Bancorp is a thrift that has recently converted to public
ownership. World Acceptance and Credit Acceptance are fast-growing consumer loan
companies. Protective Life is an exceptionally well-managed life insurer.
Niche Manufacturers. This is an eclectic group. Exide is the world's
largest and lowest cost manufacturer of automotive batteries. APS Holdings is
gaining market share in the wholesale and retail auto parts market. Littelfuse
makes industrial fuses; its largest market is the auto industry. Minerals
Technology makes precipitated calcium carbonate, which reduces the cost of
paper.
STRATEGY GOING FORWARD
We are continuing to find many good individual investment ideas in widely
diversified industries. Small companies tend to perform well in the economic
environment we are currently experiencing in the U.S. and Europe. Low interest
rates and low inflation help lower the hurdles smaller companies must cross in
the course of development. As long as these conditions are present, small
companies should benefit.
Thank you for your continued investment in Janus Venture Fund.
Janus Funds October 31, 1995 Annual Report
27
<PAGE>
JANUS VENTURE FUND Portfolio Managers, James P. Goff, Warren B. Lammert
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Venture Fund and the Russell 2000 Index. Janus Venture Fund is
represented by a solid green line and the Russell 2000 Index is represented by a
single dashed black line. The "y" axis reflects the value of the investment. The
"x" axis reflects the computation periods from inception, April 30, 1985,
through October 31, 1995. The upper right quadrant reflects the ending value of
the hypothetical investment in Janus Venture Fund ($54,465) as compared to the
Russell 2000 Index ($31,448). There is a legend in the upper left quadrant of
the graph which indicates Janus Venture Fund's one-year, five-year, ten-year and
since inception (April 30, 1985) average annual total returns as 19.24%, 19.52%,
17.63% and 17.52%, respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the index.
The index is unmanaged.
JANUS VENTURE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 89.6%
Advertising - 0.6%
574,200 Katz Media Group, Inc.* $ 10,335,600
Auto Parts - Replacement - 4.3%
1,321,672 APS Holding Corp. - Class A*,# 27,094,276
1,107,065 Exide Corp.# 48,572,477
75,666,753
Biopharmaceuticals - 0.3%
342,575 Northfield Laboratories, Inc.* 4,796,050
Broadcasting, Radio and Television - 2.2%
528,450 Heartland Wireless Communications, Inc.* 13,607,587
900,000 Heritage Media Corp. - Class A*,# 24,975,000
30,000 Scandinavian Broadcasting System S.A.* 720,000
39,302,587
Captive Finance-Auto - 0.1%
74,500 Union Acceptance Corp. - Class A* 1,173,375
Chemicals - 0.9%
120,000 Applied Extrusion Technologies, Inc.* 1,845,000
350,600 Cambrex Corp.# 13,366,625
15,211,625
Commercial Services - 0.8%
102,575 Equity Corp. International* 2,154,075
126,450 Medaphis Corp.* 4,014,788
145,700 Stewart Enterprises, Inc. - Class A 4,917,375
169,000 Vallen Corp.* 3,422,250
14,508,488
Shares or
Principal Amount Market Value
- ---------------- ------------
Computer Software and Services - 8.8%
81,500 Acxiom Corp.* $ 2,445,000
390,450 Analysts International Corp.# 11,567,081
537,450 BancTec, Inc.* 10,077,188
689,975 Bell & Howell Holdings Co.* 17,249,375
350,000 Black Box Corp.* 5,687,500
163,550 Broadway & Seymour, Inc.* 2,657,688
150,000 Dialogic Corp.* 4,350,000
662,725 Fiserv, Inc.* 17,065,169
375,825 FTP Software, Inc.* 10,147,275
200,000 Getronics N.V. 9,544,935
41,000 IMNET Systems, Inc.* 1,040,375
259,400 Integrated Systems, Inc.* 9,079,000
312,500 INTERSOLV, Inc.* 4,921,875
858,825 Keane, Inc.*,# 23,188,275
112,800 MDL Information Systems, Inc.* 2,129,100
125,000 Medic Computer Systems, Inc.* 6,656,250
200,000 NetManage, Inc.* 4,075,000
86,900 Pinnacle Systems, Inc.* 2,726,487
278,750 Platinum Software Corp.* 1,846,719
45,000 Project Software & Development, Inc.* 1,192,500
186,325 Softkey International, Inc.* 5,869,238
55,000 Summit Medical Systems, Inc.* 907,500
154,423,530
Computers - 1.3%
382,300 Boca Research, Inc.* 9,653,075
445,125 Comverse Technology, Inc.* 10,126,594
45,000 NetStar, Inc.* 461,250
145,525 Technology Solutions Co.* 2,401,163
22,642,082
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
28
<PAGE>
JANUS VENTURE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Electrical Equipment - 2.2%
364,400 Anixter International, Inc.* $ 6,969,150
173,650 Baldor Electric Co. 4,167,600
335,700 California Amplifier, Inc.*,# 9,063,900
514,300 Littelfuse, Inc.*,# 16,714,750
74,500 Zycon Corp.* 931,250
37,846,650
Electronics - 3.4%
250,000 Accom, Inc.* 2,156,250
125,800 Holophane Corp.* 3,396,600
196,425 ITI Technologies, Inc.* 4,959,731
419,050 Itron, Inc.* 12,152,450
632,900 Macromedia, Inc.* 23,417,300
74,375 Pittway Corp. - Class A 4,453,203
87,000 Whitehall Corp.* 3,251,625
354,200 X-Rite, Inc. 5,534,375
59,321,534
Electronics - Semiconductors - 1.6%
98,175 Analog Devices, Inc.* 3,546,572
133,975 Cyrix Corp.* 4,287,200
232,500 ESS Technology, Inc.* 6,975,000
110,725 LSI Logic Corp.* 5,217,916
125,000 TranSwitch Corp.* 1,593,750
284,475 VLSI Technology, Inc.* 6,685,163
28,305,601
Engineering and Construction - 0.6%
22,722 Metra Oy - A** 995,991
225,879 Metra Oy - B** 9,794,673
10,790,664
Entertainment - 0.6%
142,400 Lodgenet Entertainment Corp.* 1,637,600
300,000 Speedway Motorsports, Inc.* 8,850,000
10,487,600
Environmental Control - 1.4%
789,500 Catalytica, Inc.* 3,750,125
291,875 Continental Waste Industries, Inc.* 5,034,844
386,975 United Waste Systems, Inc.* 15,285,513
24,070,482
Financial - Bank Commercial - 2.5%
300,000 City National Corp. 3,975,000
199,850 First Empire State Corp. 39,320,488
43,295,488
Financial - Savings/Loan/Thrift - 0.7%
200,000 ISB Financial Corp. 3,350,000
697,000 Klamath First Bancorp, Inc.*,# 8,886,750
12,236,750
Financial Services - 2.4%
650,000 Credit Acceptance Corp.* 15,275,000
115,000 Envoy Corp.* 1,495,000
121,000 First Financial Caribbean Corp. 2,155,312
1,723,875 World Acceptance Corp.*,# 22,410,375
41,335,687
Food Processing - 0.5%
105,370 Cultor Oy - Series I** 4,320,783
70,436 Cultor Oy - Series II** 2,921,485
36,989 Huhtamaki Group - Series I** 1,098,347
8,340,615
Shares or
Principal Amount Market Value
- ---------------- ------------
Food Wholesale - 0.6%
683,625 J.P. Foodservice, Inc.* $ 10,425,281
Forest Products and Paper - 2.0%
97,500 Caraustar Industries, Inc. 1,828,125
2,162,617 Munksjo A.B.#,** 15,658,136
1,643,596 Repap Enterprises, Inc.* 10,375,200
5,132,368 Rottneros Bruks A.B.** 6,812,707
34,674,168
Furniture and Home Appliances - 0.7%
178,675 Industrie Natuzzi S.p.A. (ADR) $ 7,147,000
192,550 Singer Company N.V. (The) 4,524,925
11,671,925
Holding Companies - Diversified - 0.1%
74,315 Kinnevik A.B. - Class B** 2,062,593
Homebuilders - 0.4%
505,425 Southern Energy Homes, Inc.* 7,455,019
Insurance - Life - 1.4%
146,925 Liberty Financial Companies, Inc. 4,077,169
310,250 PennCorp Financial Group, Inc. 7,407,219
452,425 Protective Life Corp. 12,894,112
24,378,500
Insurance - Multiline - 0.3%
190,000 Poe & Brown, Inc. 4,631,250
40,000 United Dental Care, Inc.* 1,220,000
5,851,250
Insurance - Property and Casualty - 0.7%
100,000 Executive Risk, Inc. 2,200,000
262,550 Progressive Corp. 10,895,825
13,095,825
Iron and Steel - 0.2%
357,185 SSAB Svenskt Stal A.B. - Class A** 3,582,895
Leisure Time - 0.1%
227,300 Golf Enterprises, Inc.* 2,557,125
Lodging - 0.4%
368,550 Hammons (John Q.) Hotels, Inc.*,# 4,330,462
165,800 Renaissance Hotel Group N.V.* 3,233,100
7,563,562
Machinery - Diversified - 0.4%
66,800 Duracraft Corp.*,# 1,452,900
614,400 Westinghouse Air Brake Co.* 5,376,000
6,828,900
Medical - Biotechnology - 0.5%
60,000 DepoTech Corp.* 870,000
323,800 KeraVision, Inc.* 4,007,025
220,000 Lifecore Biomedical, Inc.* 2,172,500
60,000 Norland Medical Systems, Inc.* 1,260,000
8,309,525
Medical - Hospital Management Services - 1.2%
2,991,816 Ashbourne PLC#,** 6,809,134
133,300 Horizon Mental Health Management, Inc.* 2,066,150
170,025 MedPartners, Inc.* 4,760,700
78,600 PacifiCare Health Systems, Inc. - Class B* 5,718,150
55,850 Total Renal Care Holdings, Inc.* 1,137,944
20,492,078
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
29
<PAGE>
JANUS VENTURE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Medical Supplies - 7.0%
360,000 Exogen, Inc.* $ 5,040,000
395,150 Gulf South Medical Supply, Inc.* 8,199,362
149,000 HemaSure, Inc.* 1,899,750
124,375 ICU Medical, Inc.* 1,585,781
130,025 I-Stat Corp.* 4,030,775
242,000 Isolyser Co., Inc.* 4,325,750
428,300 Landauer, Inc.# 8,405,388
150,000 Lunar Corp.* 5,587,500
443,400 MiniMed, Inc.* 4,101,450
242,510 Nellcor Puritan Bennett, Inc.* 13,944,325
725,325 Omnicare, Inc. 26,293,031
478,825 Sofamor Danek Group, Inc.* 11,731,213
345,800 Spine-Tech, Inc.* 6,570,200
323,000 STERIS Corp.* 10,901,250
125,425 Target Therapeutics, Inc.* 9,720,437
170,775 VidaMed, Inc.* 1,216,772
123,552,984
Metal Fabrication - 0.8%
708,525 TriMas Corp. 14,701,894
Mining - 2.9%
1,257,845 Minerals Technologies, Inc.# 50,156,569
Miscellaneous - Manufacturing - 2.3%
485,000 ABC Rail Products, Corp.*,# 10,791,250
750,000 Lydall, Inc.* 17,062,500
524,400 Simula, Inc.*,# 11,471,250
50,000 Trigen Energy Corp. 875,000
40,200,000
Oil and Gas - Equipment/Services - 0.3%
266,800 Petroleum Geo-Services A/S (ADR)* 5,169,250
Packaging and Containers - 1.6%
144,900 Intertape Polymer Group, Inc. 4,202,100
210,875 Liqui-Box Corp. 5,746,344
662,700 Sealed Air Corp.* 17,478,712
27,427,156
Personal Credit - 0.4%
553,425 AmeriCredit Corp.* 6,779,456
Pharmaceuticals - 5.1%
170,000 Agouron Pharmaceuticals, Inc.* 4,420,000
450,000 Genzyme Corp.* 8,043,750
265,000 Gilead Sciences, Inc.* 5,167,500
150,000 Guilford Pharmaceuticals, Inc.* 2,475,000
1,449,350 R.P. Scherer Corp.*,# 64,496,076
175,000 Sepracor, Inc.* 2,953,125
100,000 TheraTech, Inc.* 1,875,000
89,430,451
Real Estate - 0.2%
100,000 Insignia Financial Group, Inc. - Class A* 2,700,000
100,000 NHP, Inc.* 1,425,000
4,125,000
Real Estate Investment Trust - 0.4%
405,000 Prime Residential, Inc. 7,087,500
Shares or
Principal Amount Market Value
- ---------------- ------------
Restaurants and Food Services - 4.2%
100,000 Apple South, Inc. $ 2,050,000
130,000 Daka International, Inc.* 3,948,750
528,950 DavCo Restaurants, Inc.*,# 6,744,112
182,225 Lone Star Steakhouse & Saloon, Inc.* 7,038,441
706,900 Papa John's International, Inc.*,# 27,215,650
621,900 Quality Dining, Inc.*,# 12,127,050
57,600 Sonic Corp.* 1,267,200
1,297,687 Wetherspoon (J.D.) PLC** 13,064,833
73,456,036
Retail - Department Stores - 0.7%
110,000 Dollar Tree Stores, Inc.* 2,970,000
600,000 Renters Choice, Inc.*,# 10,050,000
13,020,000
Retail - Grocery - 0.3%
201,100 Casey's General Stores, Inc. 4,625,300
Retail - Special Line - 1.9%
172,000 Creative Computers, Inc.* 4,988,000
218,000 Hollywood Entertainment Corp.* 5,831,500
1,637 Moebel Walther A.G.** 749,744
210,825 O'Reilly Automotive, Inc.* 6,904,519
50,000 Petco Animal Supplies, Inc.* 1,400,000
290,750 Viking Office Products, Inc.* 12,938,375
32,812,138
Telecommunications - 10.1%
120,000 A+ Network, Inc.* 1,680,000
1,260,725 Arch Communications Group, Inc.*,# 34,197,166
307,500 CAI Wireless Systems, Inc.* 2,536,875
155,000 C-TEC Corp.* 3,255,000
250,000 California Microwave, Inc.* 5,500,000
429,250 Clearnet Communications, Inc. - Class A* 6,385,094
731,200 CommNet Cellular, Inc.*,# 18,371,400
288,800 Metrocall, Inc.* 7,220,000
723,900 MobileMedia Corp.* 19,002,375
3,305,802 Paging Network, Inc.*,# 76,033,447
97,425 PriCellular Corp. - Class A* 1,266,525
150,000 WinStar Communications, Inc.* 2,493,750
177,941,632
Telecommunications Equipment - 2.1%
408,475 Metricom, Inc.* 6,790,897
517,608 Nokia A.B. - Class A** 29,641,727
50,000 Wireless One, Inc.* 587,500
37,020,124
Tobacco - 0.5%
286,500 Mafco Consolidated Group, Inc.* 6,517,875
345,000 PT Hanjaya Mandala Sampoerna* 3,191,629
9,709,504
Toys - 0.2%
259,950 ERO. Inc.* 1,494,712
119,200 Play By Play Toys & Novelties, Inc.* 1,281,400
2,776,112
Transportation-Railroad - 4.2%
1,214,050 Wisconsin Central Transportation Corp.# 73,146,513
Wholesale-Special Line - 0.2%
273,125 FinishMaster, Inc.*,# 3,755,469
Total Common Stock (cost $1,264,226,159) 1,569,932,895
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
30
<PAGE>
JANUS VENTURE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Preferred Stock - 4.0%
Computer Software and Services -3.3%
372,803 SAP A.G.** $ 57,179,186
Retail-Special Line - 0.7%
27,894 Moebel Walther A.G.** 12,874,458
Total Preferred Stock (cost $41,251,750) 70,053,644
Warrants - 0.3%
24,000 Heartland Wireless Communications, Inc. -
exp. 4/15/00*,+ 252,000
105,125 Littelfuse, Inc. - exp. 12/27/01* 2,667,547
500,000 Nordic American Tanker Shipping, Ltd. -
exp. 9/30/97* 2,125,000
Total Warrants (cost $4,490,564) 5,044,547
Corporate Bonds - 1.4%
Broadcasting, Radio and Television - 0.2%
$ 4,000,000 Heartland Wireless Communications, Inc.,
13.00% senior notes, due 4/15/03+ 4,190,000
Shares or
Principal Amount Market Value
- ---------------- ------------
Telecommunications - 1.2%
$ 30,000,000 PriCellular Wireless Corp., 12.25%
senior discount notes, due 10/1/03 $ 21,825,000
Total Corporate Bonds (cost $24,897,310) 26,015,000
Money Market - 0.8%
14,400,000 Janus Money Market Fund, 5.90% 14,400,000
(cost $14,400,000)
Short-Term Corporate Notes - 3.3%
General Electric Capital Corp.
57,300,000 5.83%, 11/1/95 57,300,000
(amortized cost $57,300,000)
Total Investments - 99.4% (total cost $1,406,565,783) 1,742,746,086
Cash, Receivables and Other Assets, net of Liabilities - 0.6% 10,454,610
Net Assets - 100% $1,753,200,696
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Venture Fund British Pound 1/24/96 6,925,150 $10,925,809 $ (28,844)
British Pound 3/28/96 2,977,000 4,689,668 (15,778)
Finnish Markka 11/9/95 20,916,000 4,931,391 49,795
Finnish Markka 1/24/96 121,000,000 28,566,707 (612,450)
Finnish Markka 1/25/96 54,485,000 12,863,585 (192,655)
German Deutschemark 12/14/95 20,000,000 14,238,929 140,250
German Deutschemark 2/8/96 14,936,000 10,663,240 33,602
German Deutschemark 2/12/96 12,409,000 8,861,040 26,974
German Deutschemark 3/28/96 42,777,000 30,607,470 (1,516,778)
Swedish Krona 11/9/95 22,000,000 3,317,850 (227,745)
Swedish Krona 11/21/95 128,000,000 19,282,916 (1,490,363)
$148,948,605 $(3,833,992)
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
31
<PAGE>
JANUS WORLDWIDE FUND Portfolio Manager, Helen Young Hayes
PERFORMANCE REVIEW
Although several European markets posted records during the year ended
October 31, 1995, in general foreign markets failed to keep pace with the U.S.
rally. Janus Worldwide Fund gained 8.89% for the twelve-month period, modestly
underperforming the Morgan Stanley International World Index, which gained 9.48%
for the same period. Both returns include net dividends reinvested.(1)
For the twelve-month period, the Fund's total return ranked in the top
quartile (25%), of global funds tracked by Lipper Analytical Services, Inc., a
mutual fund rating company. Janus Worldwide Fund was 28th out of 120 funds in
Lipper's Global Fund category.(2)
Ideas That Worked. Stockpicking matters. In Europe, we own a diverse group
of growth stocks focused in Germany and Sweden that have outperformed the local
markets. In Germany, Fresenius (medical products), Fielmann (retailing), SGL
Carbon (carbon electrodes), Gehe (pharmaceuticals), and SAP (software) bested
the markets. In Sweden, Assa-Abloy (housing accessories), Astra
(pharmaceuticals), Securitas (security personnel), and Sparbanken Sverige
(banking) also produced excellent returns. We saw stellar performances from such
diverse U.S. holdings as HFS (lodging), Citicorp, and Federated Department
Stores.
We Might Have Done Better. Performance was held back by our conservative
strategy early in the year, when rising interest rates in the U.S. attracted
investment away from foreign markets. The Fund held 35% cash in the fourth
calendar quarter of 1994. Currency hedging, though moderate, also constrained
performance into early 1995, when the dollar continued to fall to historic lows
against the Japanese yen and German mark. The Fund's largest position, Swedish
conglomerate Kinnevik, has not performed this year because the company took
several one-time expenses and the Scandinavian television market was weaker than
expected. However, Kinnevik is moving to increase shareholder value. The company
recently announced it intends to break up into four different divisions. Like
many conglomerates, Kinnevik's parts are worth more than the whole.
COMPOSITION OF THE PORTFOLIO
At year end, the portfolio was approximately 93.7% invested in equities, up
from 79.7% when the year began. European stocks accounted for 45.1% of assets
compared to 45.2%; the Pacific Rim was 26.6% versus 14.2%, and Japan was 16.9%,
versus 9.4%. Investment in Japan was increased during the fourth quarter when
the dollar bottomed definitively against the yen and the Japanese economy showed
signs of acceleration. The largest ten positions made up 28.3% of the portfolio
at year end.
- --------------------------------------------------------------------------------
Ten Largest Holdings October 31, 1995 October 31, 1994
Kinnevik 5.1% 5.3%
Roche Holdings 3.3% 0.9%
SAP AG 3.3% --
NTT Data 2.6% --
HFS, Inc. 2.6% --
Wolters Kluwer 2.6% 2.4%
Ciba-Geigy 2.3% --
PT Hanjaya Mandala Sampoerna 2.3% 0.7%
Getronics 2.1% --
Astra 2.1% 5.4%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top Five Industries October 31, 1995 October 31, 1994
Pharmaceuticals 11.8% 12.7%
Computers - Software and Services 9.4% 0.3%
Holding Companies - Diversified 7.8% 5.3%
Publishing and Printing 4.7% 5.6%
Financial - Bank Commercial 4.3% 4.3%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Countries October 31, 1995 October 31, 1994
Japan 16.9% 9.4%
United States(3) 16.3% 10.5%
Sweden 12.5% 20.2%
Germany 9.5% 3.3%
Switzerland 7.6% 0.9%
- --------------------------------------------------------------------------------
PORTFOLIO THEMES
Multinational Pharmaceuticals. Roche, Sandoz, Astra, and Ciba-Geigy in
Europe, and Pfizer in the U.S., either have or are developing blockbuster drugs.
Astra's anti-ulcer drug Losec is the best-selling treatment in Europe, and Astra
has a new asthma drug in development. Sandoz is developing a drug to treat
Alzheimer's.
Information Technology. Demand for systems to automate all facets of
corporate operations has exploded in the past five years. SAP is the largest
international provider of integrated software. Getronics is a software
consultant.
Outsourcing. Many corporate operations, including information and data
processing, are more cost-effective if handled by outside specialists. EDS
(General Motors E), First Data, which recently acquired competitor First
Financial Management, and NTT Data Communications are data processors benefiting
from the outsourcing phenomenon.
Telecommunications. The boom in technology has created affordable cellular
communications and a very strong demand cycle. Nokia, the Finnish cellular
equipment manufacturer, Kinnevik, and DDI, an independent Japanese long-distance
provider, should profit from consumer enthusiasm for cellular communications.
GLOBAL STRATEGY
The Janus Worldwide Fund looks for individual companies with strong
earnings growth. As foreign markets and economies continue to deregulate and
open to global investment, new and exciting investment opportunities should
increase. Most mature economies are experiencing moderate growth, low inflation,
and stable interest rates. Many developing economies are working to attain a
similar climate. Over time, these efforts should continue to create exciting
markets.
Thank you for your investment in Janus Worldwide Fund.
- -----------------------------
(1) Net dividends reinvested are the dividends that remain to be reinvested
after foreign tax obligations have been met. Such obligations vary from
country to country.
(2) A Global Fund is defined by Lipper Analytical Services as one "which
invests at least 25% of its portfolio in securities traded outside of the
United States and may own U.S. securities as well." This ranking is based
on total return, including reinvestment of dividends and capital gains for
the stated period. Past performance is not predictive of future results.
(3) Not including short-term securities.
Janus Funds October 31, 1995 Annual Report
32
<PAGE>
JANUS WORLDWIDE FUND Portfolio Manager, Helen Young Hayes
PERFORMANCE OVERVIEW
[line graph]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Worldwide Fund and the Morgan Stanley International World Index. Janus
Worldwide Fund is represented by a solid green line. Morgan Stanley
International World Index is represented by a single dashed black line. The "y"
axis reflects the value of the investment. The "x" axis reflects the computation
periods from inception, May 15, 1991, through October 31, 1995. The upper right
quadrant reflects the ending value of the hypothetical investment in Janus
Worldwide Fund ($20,388) as compared to the Morgan Stanley International World
Index ($14,819). There is a legend in the upper left quadrant of the graph which
indicates Janus Worldwide Fund's one-year and since inception (May 15, 1991)
average annual total returns as 8.89% and 17.32%, respectively.
Source - Lipper Analytical Services, Inc. 1995. All returns reflect reinvested
dividends.
Past performance is not predictive of future performance. Investment return and
principal value may fluctuate so that shares, when redeemed, may be worth more
or less than their original cost.
The Fund's portfolio may differ significantly from the securities in the index.
The index is unmanaged.
JANUS WORLDWIDE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Common Stock - 88.6%
Aerospace and Defense - 1.0%
2,226,000 Mitsubishi Heavy Industries, Ltd.** $ 17,215,389
Auto and Truck - 2.2%
290,670 Bajaj Auto, Ltd. (GDR)*,#,+ 7,848,090
100,367 Volkswagen A.G.** 31,607,444
39,455,534
Brewery - 0.4%
10,965,000 CIA Cervejaria Brahma 4,185,723
266,450 Erciyas Biracilik Ve Malt Sanayii (GDR)*,+ 3,376,721
7,562,444
Broadcasting, Radio and Television - 0.4%
32,700 Bell Cablemedia PLC (ADR)* 486,413
30,000 Central European Media Enterprises, Ltd. 690,000
16,800 Grupo Televisa S.A. de C.V. (GDR) 287,700
141,500 Heritage Media Corp. - Class A* 3,926,625
77,000 NYNEX CableComms Group, Inc. (ADR)* 1,559,250
38,500 TeleWest PLC (ADR)* 1,068,375
8,018,363
Building Materials - 0.3%
2,435,500 PT Semen Cibinong 6,383,799
Chemicals - 0.1%
114,595 Reliance Industries (GDS)* 1,789,974
Closed End Funds - 0.1%
281,425 NIS Regional Fund*,+ 1,772,977
Commercial Services - 2.4%
1,449 Grand Optical Photoservice** 155,298
878,727 Securitas A.B. - Class B#,** 34,064,837
258,003 WM-Data A.B. - Class B#,** 9,495,849
43,715,984
Shares or
Principal Amount Market Value
- ---------------- ------------
Computer Software and Services - 6.1%
116,950 First Data Corp. $ 7,733,318
330,300 General Motors Corp. - Class E 15,565,388
805,274 Getronics N.V. 38,431,442
128,567 JBA Holdings PLC** 784,352
1,902 NTT Data Communications Systems Corp.** 47,727,112
110,241,612
Computers - 1.6%
32,670 Frontec A.B. - Class B*,** 788,475
237,475 Sun Microsystems, Inc.* 18,523,050
230,000 Tokyo Electron, Ltd.** 10,009,802
29,321,327
Electrical Equipment - 1.4%
2,460,000 Hitachi, Ltd.** 25,318,564
Electronics - 2.2%
337,000 Kyocera Corp.*,** 27,681,435
75,000 Nokia Corp. (ADR) - Class A 4,181,250
90,700 Sony Corp.** 4,089,590
47,150 Sony Corp. (ADR) 2,157,113
203,000 Victor Co. of Japan, Ltd.*,** 2,168,888
40,278,276
Electronics - Semiconductors - 1.5%
452,000 Rohm Co.** 27,513,428
Engineering and Construction - 1.1%
425,359 Metra Oy - B** 18,444,619
1,076,000 New World Infrastructure, Ltd.*,+ 1,892,895
20,337,514
Entertainment - 1.1%
839,979 Thorn EMI PLC** 19,555,353
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
33
<PAGE>
JANUS WORLDWIDE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Financial - Bank Commercial - 4.3%
305,529 Bangkok Bank Co., Ltd. $ 3,157,294
485,000 Dai-Ichi Kangyo Bank, Ltd.** 8,224,367
91,325 First Interstate Bancorp 11,780,925
854,347 Fokus Bank A.S.+ 4,526,886
1,006,000 HSBC Holdings PLC 14,639,493
804,000 Mitsui Trust and Banking Co., Ltd.*,** 6,446,500
537,209 Nordbanken A.B.*,** 8,022,277
3,415,000 PT Bank Dagang Nasional Indonesia+ 3,046,420
781,000 Sakura Bank, Ltd.** 7,578,808
426,000 Sanwa Bank, Ltd.** 7,265,634
390,000 Thai Farmers Bank, Ltd. 3,224,165
77,912,769
Financial - Bank Money Center - 3.8%
546,525 Chase Manhattan Corp. 31,151,925
481,775 Citicorp 31,255,153
603,000 Sumitomo Trust and Banking Co., Ltd.*,** 6,974,514
69,381,592
Financial - Savings and Loan - 0.2%
308,788 Sparbanken Sverige A.B. - Class A** 3,260,451
Financial Services - 1.6%
10,378,975 Grupo Financiero Inbursa S.A. - Class C* 28,373,118
Food Processing - 1.2%
68,357 Cultor Oy - Series I** 2,803,034
101,831 Cultor Oy - Series II** 4,223,659
250,099 Huhtamaki Group - Series I** 7,426,407
88,974 Nutricia Vereenigde Bedrijven N.V. 6,907,919
21,361,019
Forest Production and Paper - 0.3%
3,520,306 Rottneros Bruks A.B.*,** 4,672,855
Furniture and Home Appliances - 0.7%
332,625 Industrie Natuzzi S.p.A. (ADR) 13,305,000
Holding Company - Diversified - 7.8%
6,296,700 Citic Pacific, Ltd. 19,670,060
9,366,000 First Pacific Co. 10,782,506
2,477,600 Grupo Carso S.A. de C.V. - Series A1* 13,195,150
910,000 Hutchison Whampoa, Ltd. 5,014,487
3,320,139 Kinnevik A.B. - Class B#,** 92,149,611
140,811,814
Household Products - 0.5%
228,700 Amway Japan, Ltd.** 8,742,697
Industrial Materials - Special - 0.1%
113,300 Malbak, Ltd.+ 736,450
Iron and Steel - 0.1%
235,743 SSAB Svenskt Stal A.B. - Class A** 2,364,719
Leisure Time - 0.4%
2,318,690 Tabcorp Holdings, Ltd.* 6,432,046
Lodging - 4.1%
188,893 Accor S.A.** 22,490,026
756,925 HFS, Inc.* 46,361,656
254,275 Renaissance Hotel Group N.V.* 4,958,363
73,810,045
Machine - Diversified - 0%
31,935 IRO A.B.+,** 390,185
Medical - Hospital Management Service - 0.6%
145,650 Horizon Healthcare Corp.* 2,949,413
2,546,069 Takare PLC** 8,249,327
11,198,740
Medical Supplies - 0.9%
62,050 Gelman Sciences, Inc. 1,326,319
54,094 Getinge Industrier A.B. - Class B** 2,309,163
Shares or
Principal Amount Market Value
- ---------------- ------------
Medical Supplies (continued)
180,000 Nellcor Puritan Bennett, Inc.* $ 10,350,000
67,666 Scandinavian Mobility International*,+ 1,610,357
15,595,839
Metals - Diversified - 0.5%
344,854 Hoganas A.B. - Class B** 9,311,240
Mining - 1.2%
338,704 SGL Carbon A.G.*,#,+,** 22,198,664
Miscellaneous - Manufacturing - 2.7%
2,309,126 Assa-Abloy A.B. - Class B*,** 15,325,672
162,354 Barco N.V. 18,288,035
160,748 Orkla A/S - Class A 8,310,991
2,425,000 Thorn Lighting+,** 6,515,611
48,440,309
Office and Business Equipment - 1.8%
969,000 Canon, Inc.** 16,621,740
260,192 Oce-Van Der Grinten N.V. 14,924,197
31,545,937
Oil and Gas - Equipment and Services - 0.2%
183,725 Petroleum Geo - Services A/S (ADR)* 3,559,672
Packaging and Containers - 1.3%
691,650 Crown Cork & Seal Co., Inc.* 24,121,294
Pharmaceuticals - 11.8%
1,038,787 Astra A.B. - Class A** 38,232,751
48,370 Ciba-Geigy Corp. A.G.** 41,727,640
106,200 Pfizer, Inc. 6,093,225
8,205 Roche Holding A.G.** 59,587,366
360,525 R.P. Scherer Corp.* 16,043,363
39,018 Sandoz A.G. - Class R** 32,457,755
403,000 Sankyo Co., Ltd.** 8,887,963
421,000 Yamanouchi Pharmaceutical Co., Ltd.*,** 9,408,743
212,438,806
Publishing and Printing - 4.5%
265,052 Elsevier N.V. 3,426,962
2,774,687 News Corp., Ltd.* 12,135,702
959,500 News Corp., Ltd. (ADR) 19,070,062
507,287 Wolters Kluwer N.V. 46,169,610
80,802,336
Real Estate - 0.9%
8,890,000 Henderson Investment, Ltd. 7,244,657
699,000 Mitsui Fudosan Co.*,** 8,016,369
15,261,026
Retail - Apparel - 0.5%
226,000 Fila Holdings S.p.A. (ADR) 9,746,250
Retail - Department Stores - 1.5%
793,950 Federated Department Stores, Inc.* 20,146,481
3,559,000 PT Matahari Putra Prima 7,447,246
27,593,727
Retail - General Merchandise - 0.2%
308,000 Pao De Acucar S.A.+ 3,234,000
Retail - Grocery - 0.5%
162,000 Ito-Yokado Co., Ltd.** 8,876,494
Telecommunications - 2.1%
112,675 AirTouch Communications, Inc.* 3,211,238
329,075 Korea Mobile Telecommunications, Inc.*,#,+ 12,093,506
72,200 Millicom International Cellular S.A.* 2,382,600
139,150 Paging Network, Inc.* 3,200,450
404,951 Telecomunicacoes Brasileiras S.A. (ADR) 16,198,040
38,500 Videotron Holdings PLC (ADR)* 507,719
37,593,553
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
34
<PAGE>
JANUS WORLDWIDE FUND October 31, 1995
Shares or
Principal Amount Market Value
- ---------------- ------------
Telecommunications Equipment - 0.9%
291,073 Nokia A.B. - Class A** $ 16,668,804
Textiles - 0.4%
250,000 Gucci Group 7,500,000
Tobacco - 2.3%
4,433,500 PT Hanjaya Mandala Sampoerna* 41,014,756
Toys - 1.2%
724,575 Mattel, Inc. 20,831,531
Utilities - Electric - 1.0%
6,418,889 Consolidated Electric Power Asia, Ltd. 12,994,206
233,625 Consolidated Electric Power Asia, Ltd. (ADR)+ 4,729,505
17,723,711
Utilities - Telecommunications - 2.8%
4,688 DDI Corp.** 38,094,020
1,427,541 Telecom Italia Mobile S.p.A.* 2,407,067
645,890 Telefonica de Espana S.A. 8,156,380
58,100 Telefonica de Espana S.A. (ADR) 2,186,013
50,843,480
Wholesale-Special Line - 1.8%
66,883 Gehe A.G.** 32,816,980
Total Common Stock (cost $1,429,832,101) 1,598,952,447
Preferred Stock - 5.1%
Computer Software and Services - 3.3%
383,783 SAP A.G.** 58,863,259
Financial-Bank Commercial - 0%
3,481,000 Banco Bradesco S.A. 32,586
Medical Supplies - 1.0%
22,653 Fresenius A.G.** 18,096,020
Publishing and Printing - 0.2%
862,757 News Corp., Ltd. 3,934,171
Retail-Department Stores - 0%
14,639,000 Lojas Americanas S.A. 350,215
Retail-Special Line - 0.2%
64,615 Fielmann A.G.*,** 3,555,820
Telecommunications - 0%
91,000 Telecomunicacoes Brasileiras S.A. 3,693
Utilities-Electric - 0.4%
25,686,000 Centrais Eletricas Brasileiras S.A. - Class B 7,320,536
Total Preferred Stock (cost $68,070,563) 92,156,300
Shares or
Principal Amount Market Value
- ---------------- ------------
Money Market - 1.0%
$ 4,500,000 Janus Government Money Market Fund, 5.85% $ 4,500,000
13,000,000 Janus Money Market Fund, 5.90% 13,000,000
Total Money Market (cost $17,500,000) 17,500,000
Short-Term Corporate Notes - 3.2%
57,600,000 General Electric Capital Corp., 5.83%, 11/1/95
(amortized cost $57,600,000) 57,600,000
Total Investments - 97.9% (total cost $1,573,002,664) 1,766,208,747
Cash, Receivables and Other Assets, net of Liabilities - 2.1% 38,144,871
Net Assets - 100% $1,804,353,618
SUMMARY OF INVESTMENTS BY COUNTRY
October 31, 1995
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Australia 2.4% 41,571,982
Belgium 1.0% 18,288,035
Brazil 1.8% 31,324,793
Denmark 0.1% 1,610,357
Finland 3.0% 53,747,776
France 1.3% 22,645,430
Germany 9.5% 167,138,188
Hong Kong 4.4% 76,967,813
India 0.5% 9,638,064
Indonesia 3.2% 57,892,224
Italy 1.9% 32,958,317
Japan 16.9% 299,022,139
Korea 0.7% 12,093,506
Mexico 2.4% 41,855,968
Netherlands 6.2% 109,860,133
Norway 0.7% 12,837,878
Russia 0.1% 1,772,977
South Africa 0.0% 736,450
Spain 0.6% 10,342,393
Sweden 12.5% 220,388,043
Switzerland 7.6% 133,772,764
Thailand 0.4% 6,381,460
Turkey 0.2% 3,376,721
United Kingdom 2.1% 36,302,363
United States+ 20.5% 363,682,973
Total 100.0% $1,766,208,747
- --------------------------------------------------------------------------------
+ Includes Short-Term Securities
FORWARD FOREIGN CURRENCY CONTRACTS
Open at October 31, 1995
<TABLE>
<CAPTION>
Currency Currency Unrealized
Fund Currency Sold and Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Worldwide Fund British Pound 1/25/96 13,061,000 $ 20,605,033 $ 49,898
Finnish Markka 11/9/95 80,520,000 18,984,298 146,273
Finnish Markka 1/25/96 66,833,000 15,778,874 (236,316)
French Franc 12/14/95 38,635,000 7,911,010 (307,342)
French Franc 3/14/96 65,000,000 13,291,890 (412,952)
German Deutschemark 1/25/96 139,269,000 99,364,298 968,613
Japanese Yen 11/21/95 5,206,000,000 50,985,881 7,322,755
Japanese Yen 1/25/96 1,705,831,000 16,708,141 1,649,306
Japanese Yen 2/8/96 12,800,000,000 125,375,023 11,461,851
Japanese Yen 3/14/96 5,000,000,000 48,977,065 1,704,953
Swedish Krona 11/9/95 409,562,000 61,766,604 (4,239,812)
Swedish Krona 1/25/96 964,886,400 144,699,679 (8,839,112)
Swiss Franc 11/9/95 35,188,000 31,016,307 (549,187)
$655,464,103 $ 8,718,928
</TABLE>
See Notes to Schedule of Investments
Janus Funds October 31, 1995 Annual Report
35
<PAGE>
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Janus Janus Janus
Janus Balanced Enterprise Growth and Income
For the year ended October 31, 1995 (all numbers in thousands) Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investment Income:
Interest $ 104,338 $ 2,803 $ 1,927 $ 4,158
Dividends 121,288 1,351 3,187 7,329
Foreign Tax Withheld (2,840) (29) (107) (147)
222,786 4,125 5,007 11,340
Expenses:
Advisory fees 69,102 879 3,079 3,704
Transfer agent fees and expenses 17,011 367 1,451 1,676
Registration fees 109 34 82 31
Postage and mailing expenses 2,196 78 210 301
Custodian fees 2,590 38 110 79
Printing expenses -- 9 37 59
Audit fees 41 9 13 12
Trustees' fees and expenses 130 2 5 11
Other expenses 360 27 26 38
Total expenses 91,539 1,443 5,013 5,911
Expense and fee offsets (932) (26) (97) (104)
Net expenses 90,607 1,417 4,916 5,807
Net investment income/(loss) 132,179 2,708 91 5,533
Net Realized and Unrealized Gain/(Loss) on Investments:
Net realized gain/(loss)
from securities transactions 582,514 7,579 32,364 85,303
Net realized gain/(loss)
from foreign currency transactions (33,923) (196) (2,586) (1,192)
Net realized gain/(loss)
from futures contracts (9,439) 98 1,013 --
Change in net unrealized appreciation
or depreciation of investments 1,433,338 8,194 29,273 20,058
Net gain/(loss) on investments 1,972,490 15,675 60,064 104,169
Net increase/(decrease) in
net assets resulting from operations $ 2,104,669 $ 18,383 $ 60,155 $ 109,702
</TABLE>
STATEMENTS OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
Janus
Janus Janus Growth
As of October 31, 1995 Janus Balanced Enterprise and Income
(all numbers in thousands except net asset value per share) Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Assets:
Investments at cost $ 9,901,237 $ 111,344 $ 380,435 $ 499,804
Investments at value $12,144,698 $ 121,102 $ 463,112 $ 581,566
Cash 2,453 122 577 641
Receivables:
Investments sold 214,181 6,748 4,547 42,324
Fund shares sold 19,349 318 1,516 1,024
Interest 1,267 726 -- 472
Dividends 12,461 91 268 685
Foreign currency contracts -- -- -- --
Other assets 104 1 10 7
Total Assets 12,394,513 129,108 470,030 626,719
Liabilities:
Payables:
Investments purchased 374,148 4,059 9,618 41,928
Fund shares repurchased 8,060 84 256 417
Advisory fee 6,651 85 292 358
Transfer agent fee 1,438 29 163 165
Accrued expenses 1,838 47 99 96
Foreign currency contracts 39,408 259 232 792
Total Liabilities 431,543 4,563 10,660 43,756
Net Assets $11,962,970 $ 124,545 $ 459,370 $ 582,963
Shares Outstanding, $0.01 Par Value
(unlimited shares authorized) 511,868 9,076 16,925 32,158
Net Asset Value Per Share $ 23.37 $ 13.72 $ 27.14 $ 18.13
</TABLE>
See Notes to Financial Statements
Janus Funds October 31, 1995 Annual Report
36
<PAGE>
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Janus Janus Janus Janus Janus
Mercury Overseas Twenty Venture Worldwide
For the year ended October 31, 1995 (all numbers in thousands) Fund Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment Income:
Interest $ 9,678 $ 794 $ 12,385 $ 11,885 $ 14,324
Dividends 9,199 948 32,133 7,899 21,739
Foreign Tax Withheld (784) (119) (700) (289) (2,476)
18,093 1,623 43,818 19,495 33,587
Expenses:
Advisory fees 7,720 657 18,128 10,948 11,014
Transfer agent fees and expenses 3,293 420 7,326 2,973 4,449
Registration fees 391 36 49 38 173
Postage and mailing expenses 639 86 936 332 637
Custodian fees 460 120 511 368 1,210
Printing expenses 103 12 94 112 105
Audit fees 18 12 23 29 24
Trustees' fees and expenses 29 2 47 24 20
Other expenses 43 21 148 83 47
Total expenses 12,696 1,366 27,262 14,907 17,679
Expense and fee offsets (155) (25) (349) (165) (154)
Net expenses 12,541 1,341 26,913 14,742 17,525
Net investment income/(loss) 5,552 282 16,905 4,753 16,062
Net Realized and Unrealized Gain/(Loss) on Investments:
Net realized gain/(loss)
from securities transactions 188,818 1,940 546,321 219,511 67,214
Net realized gain/(loss)
from foreign currency transactions (13,022) 579 (13,084) (5,335) (15,333)
Net realized gain/(loss)
from futures contracts 2,706 -- -- -- 3,294
Change in net unrealized appreciation
or depreciation of investments 83,666 6,447 47,686 67,671 65,211
Net gain/(loss) on investments 262,168 8,966 580,923 281,847 120,386
Net increase/(decrease) in
net assets resulting from operations $ 267,720 $ 9,248 $ 597,828 $ 286,600 $ 136,448
</TABLE>
STATEMENTS OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
Janus Janus Janus Janus Janus
As of October 31, 1995 Mercury Overseas Twenty Venture Worldwide
(all numbers in thousands except net asset value per share) Fund Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets:
Investments at cost $1,345,948 $ 95,037 $2,518,301 $1,406,566 $1,573,003
Investments at value $1,488,071 $104,913 $2,975,194 $1,742,746 $1,766,209
Cash 656 539 1,544 1,758 542
Receivables:
Investments sold 47,039 4,175 73,553 42,610 26,994
Fund shares sold 16,674 2,483 1,931 665 7,830
Interest 165 -- 1,718 96 83
Dividends 970 180 4,134 492 3,674
Foreign currency contracts -- 24 -- -- 8,719
Other assets 5 1 50 27 34
Total Assets 1,553,580 112,315 3,058,124 1,788,394 1,814,085
Liabilities:
Payables:
Investments purchased 17,520 187 50,512 29,219 5,485
Fund shares repurchased 7,835 1,085 2,334 580 2,094
Advisory fee 878 75 1,702 1,031 1,049
Transfer agent fee 367 32 902 317 476
Accrued expenses 494 70 397 212 627
Foreign currency contracts 5,718 -- 6,526 3,834 --
Total Liabilities 32,812 1,449 62,373 35,193 9,731
Net Assets $1,520,768 $110,866 $2,995,751 $1,753,201 $1,804,354
Shares Outstanding, $0.01 Par Value
(unlimited shares authorized) 87,495 9,571 99,445 29,453 65,255
Net Asset Value Per Share $ 17.38 $ 11.58 $ 30.12 $ 59.53 $ 27.65
</TABLE>
AN EXPLANATION OF THE STATEMENT OF OPERATIONS
This financial statement details the Funds' income, expenses, and gains and
losses on securities and currency transactions and from appreciation or
depreciation of portfolio holdings. The first section in this statement, called
"Investment Income," reports the dividends earned from stocks and interest
earned from interest-bearing securities in the portfolio.
The next section reports the expenses incurred by the Funds including the
advisory fee paid to the investment advisor, the transfer agent fees,
shareholder servicing expenses, printing and postage for mailing statements,
financial reports and prospectuses to investors.
The last section lists the increase or decrease in the value of securities
held in the Fund's portfolio. Funds realize a gain (or loss) when they sell
their position in a particular security. Unrealized gain (or loss) refers to the
change in net appreciation or depreciation of the Fund's portfolio during the
period. This figure is affected by both changes in the market value of portfolio
holdings and by gains (or losses) realized during the reporting period.
AN EXPLANATION OF THE STATEMENT OF ASSETS AND LIABILITIES
This financial statement is often referred to as the "balance sheet." It
lists the assets and liabilities of the Funds on the last day of the fiscal
period.
The Funds' assets are calculated by adding the value of the securities
owned, the receivable for securities sold but not yet settled, the receivable
for dividends declared, but not yet received, on stocks owned, and the
receivable for Fund shares sold to investors but not yet settled. The Funds'
liabilities include payables for securities purchased but not yet settled, Fund
shares redeemed but not yet paid, and expenses owed but not yet paid.
There may be other assets and liabilities such as forward currency
contracts.
The last line of this schedule reports the Funds' net asset value (NAV) per
share on the last day of the fiscal period. The NAV is calculated by dividing
the fund's total net assets (assets minus liabilities) by the number of shares
outstanding.
Janus Funds October 31, 1995 Annual Report
37
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the year ended October 31, 1995 Janus Janus
and the year Janus Balanced Enterprise
or period ended October 31, 1994 Fund Fund Fund
(all numbers in thousands) 1995 1994 1995 1994 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income/(loss) $ 132,179 $ 104,800 $ 2,708 $ 1,965 $ 91 $ (858)
Net realized gain/(loss) from
investment transactions 539,152 112,901 7,481 2,772 30,791 13,842
Change in unrealized net appreciation
or depreciation of investments 1,433,338 (143,484) 8,194 (3,493) 29,273 29,068
Net increase/(decrease) in net assets
resulting from operations 2,104,669 74,217 18,383 1,244 60,155 42,052
Dividends and Distributions to
Shareholders:
Net investment income* (4,024) (173,127) (4,692) (1,697) (7,697) (196)
Net realized gain from
investment transactions (190,268) (419,077) -- -- (5,604) (6,261)
Net decrease from dividends
and distributions (194,292) (592,204) (4,692) (1,697) (13,301) (6,457)
Capital Share Transactions:
Shares sold 2,147,778 2,612,140 44,222 51,412 362,414 320,299
Reinvested dividends and distributions 186,387 570,758 4,464 1,622 12,981 6,309
Shares repurchased (1,928,817) (2,115,666) (31,378) (31,582) (332,907) (231,509)
Net increase/(decrease) from
capital share transactions 405,348 1,067,232 17,308 21,452 42,488 95,099
Net increase/(decrease) in net assets 2,315,725 549,245 30,999 20,999 89,342 130,694
Net Assets:
Beginning of period 9,647,245 9,098,000 93,546 72,547 370,028 239,334
End of Period $ 11,962,970 $ 9,647,245 $ 124,545 $ 93,546 $ 459,370 $ 370,028
Net Assets consist of:
Capital(par value and
paid-in surplus)* $ 9,085,739 $ 8,688,911 $ 106,754 $ 89,446 $ 346,567 $ 304,080
Undistributed net investment
income/(distribution in excess)* 66,492 (8,497) 356 83 -- (5)
Undistributed net realized
gain/(loss)* from investments 606,668 196,098 7,935 2,711 30,358 12,782
Unrealized appreciation/
(depreciation) of investments 2,204,071 770,733 9,500 1,306 82,445 53,171
$ 11,962,970 $ 9,647,245 $ 124,545 $ 93,546 $ 459,370 $ 370,028
Transactions in Fund Shares:
Shares sold 103,296 133,897 3,512 4,212 15,200 14,584
Reinvested distributions 9,925 29,436 371 134 565 288
Total 113,221 163,333 3,883 4,346 15,765 14,872
Shares repurchased (92,980) (108,992) (2,493) (2,591) (13,986) (10,670)
Net increase/(decrease) 20,241 54,341 1,390 1,755 1,779 4,202
Shares outstanding beginning of period 491,627 437,286 7,686 5,931 15,146 10,944
Shares outstanding end of period 511,868 491,627 9,076 7,686 16,925 15,146
Purchases and Sales of Investment Securities:
(excluding Short-Term Securities)
Purchases of Securities $ 11,575,417 $10,601,054 $ 173,144 $ 121,814 $ 774,127 $ 548,630
Proceeds from Sales of Securities 10,339,397 10,038,464 151,167 125,937 716,403 469,221
Purchases of Long-Term U.S.
Government Obligations 99,172 388,976 29,427 6,356 -- --
Proceeds from Sales of Long-Term
U.S. Government Obligations 102,063 663,560 21,157 1,411 -- --
</TABLE>
AN EXPLANATION OF THE STATEMENT OF CHANGES IN NET ASSETS
This financial statement reports the increase or decrease in the Funds' net
assets during the reporting period. Changes in the Funds' net assets are
attributable to investment operations, dividends, distributions, and capital
share transactions. This schedule is of importance to investors because it shows
exactly what caused the Funds' net asset size to change during the period.
Investors can use this information to determine if the Funds' growth was a
result of operations or an increase in the number of shares being purchased.
The first section summarizes the information from the Statement of
Operations regarding changes in net assets due to the Funds' investment
performance. The Funds' net assets will also change as a result of dividend and
capital gains distributions to investors. If investors receive their dividends
in cash, money is taken out of the Fund to pay the distribution. If investors
reinvest their dividends, the Funds' net assets will not be affected. If you
compare each Funds' "Net decrease from dividends and distributions" to the
"Reinvested dividends and distributions," you'll notice that dividend
distributions had little effect on each Funds' net assets. This is because the
majority of Janus investors reinvest their distributions.
The reinvestment of dividends is included under "Capital Share
Transactions." "Capital Shares" refers to the money investors contribute to the
Funds through purchases or withdraw via redemptions. The Funds' net assets will
increase and decrease in value as investors purchase and redeem shares from the
Fund.
The section titled "Net Assets Consist of" breaks down the components of
the Funds' net assets. Since funds must distribute substantially all earnings,
you'll notice that a significant portion of net assets is shareholder capital.
- ----------------------------------
(1) Period May 2, 1994 (inception) to October 31, 1994
*See Note 3 in Notes to Financial Statements
See Notes to Financial Statements
Janus Funds October 31, 1995 Annual Report
38
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the year ended October 31, 1995 Janus Janus Janus
and the year Growth and Income Mercury Overseas
or period ended October 31, 1994 Fund Fund Fund
(all numbers in thousands) 1995 1994 1995 1994 1995 1994(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income/(loss) $ 5,533 $ 6,307 $ 5,552 $ 654 $ 282 $ (118)
Net realized gain/(loss) from
investment transactions 84,111 (15,650) 178,502 14,943 2,519 (1,141)
Change in unrealized net appreciation
or depreciation of investments 20,058 4,709 83,666 40,804 6,447 3,453
Net increase/(decrease) in net assets
resulting from operations 109,702 (4,634) 267,720 56,401 9,248 2,194
Dividends and Distributions to
Shareholders:
Net investment income* (3,346) (3,309) (8,192) -- -- --
Net realized gain from
investment transactions -- (11,430) (5,231) -- -- --
Net decrease from dividends
and distributions (3,346) (14,739) (13,423) -- -- --
Capital Share Transactions:
Shares sold 113,855 162,999 1,329,738 687,939 128,820 71,522
Reinvested dividends and distributions 3,214 14,297 12,799 -- -- --
Shares repurchased (130,404) (186,944) (672,396) (260,735) (91,267) (9,651)
Net increase/(decrease) from
capital share transactions (13,335) (9,648) 670,141 427,204 37,553 61,871
Net increase/(decrease) in net assets 93,021 (29,021) 924,438 483,605 46,801 64,065
Net Assets:
Beginning of period 489,942 518,963 596,330 112,725 64,065 --
End of Period $ 582,963 $ 489,942 $1,520,768 $ 596,330 $ 110,866 $ 64,065
Net Assets consist of:
Capital(par value and
paid-in surplus)* $ 428,405 $ 441,740 $1,199,506 $ 529,366 $ 98,841 $ 61,288
Undistributed net investment
income/(distribution in excess)* 607 406 -- -- 1,174 --
Undistributed net realized
gain/(loss)* from investments 72,981 (13,116) 184,857 14,225 951 (676)
Unrealized appreciation/
(depreciation) of investments 80,970 60,913 136,405 52,739 9,900 3,453
$ 582,963 $ 489,942 $1,520,768 $ 596,330 $ 110,866 $ 64,065
Transactions in Fund Shares:
Shares sold 7,113 11,178 88,118 53,024 11,936 7,144
Reinvested distributions 212 977 940 -- -- --
Total 7,325 12,155 89,058 53,024 11,936 7,144
Shares repurchased (8,529) (12,846) (43,801) (20,417) (8,547) (962)
Net increase/(decrease) (1,204) (691) 45,257 32,607 3,389 6,182
Shares outstanding beginning of period 33,362 34,053 42,238 9,631 6,182 --
Shares outstanding end of period 32,158 33,362 87,495 42,238 9,571 6,182
Purchases and Sales of Investment Securities:
(excluding Short-Term Securities)
Purchases of Securities $ 857,522 $ 536,313 $2,539,449 $ 844,500 $ 141,411 $ 87,659
Proceeds from Sales of Securities 883,780 523,030 1,894,699 577,910 117,541 30,376
Purchases of Long-Term U.S.
Government Obligations 75,020 34,485 -- -- -- --
Proceeds from Sales of Long-Term
U.S. Government Obligations 78,554 79,662 -- -- -- --
</TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the year ended October 31, 1995 Janus Janus Janus
and the year Twenty Venture Worldwide
or period ended October 31, 1994 Fund Fund Fund
(all numbers in thousands) 1995 1994 1995 1994 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income/(loss) $ 16,905 $ 17,290 $ 4,753 $ 4,286 $ 16,062 $ 5,250
Net realized gain/(loss) from
investment transactions 533,237 (24,725) 214,176 80,431 55,175 99,098
Change in unrealized net appreciation
or depreciation of investments 47,686 (129,746) 67,671 47,575 65,211 46,242
Net increase/(decrease) in net assets
resulting from operations 597,828 (137,181) 286,600 132,292 136,448 150,590
Dividends and Distributions to
Shareholders:
Net investment income* (7,400) (35,434) (862) (17,532) (32,032) (10,026)
Net realized gain from
investment transactions -- (63,233) (82,645) (145,179) (60,061) (13,741)
Net decrease from dividends
and distributions (7,400) (98,667) (83,507) (162,711) (92,093) (23,767)
Capital Share Transactions:
Shares sold 387,080 454,640 145,222 168,628 788,071 1,127,205
Reinvested dividends and distributions 7,202 96,084 81,200 155,972 88,948 23,016
Shares repurchased (731,771) (1,320,860) (226,790) (580,362) (704,140) (444,532)
Net increase/(decrease) from
capital share transactions (337,489) (770,136) (368) (255,762) 172,879 705,689
Net increase/(decrease) in net assets 252,939 (1,005,984) 202,725 (286,181) 217,234 832,512
Net Assets:
Beginning of period 2,742,812 3,748,796 1,550,476 1,836,657 1,587,120 754,608
End of Period $ 2,995,751 $ 2,742,812 $1,753,201 $1,550,476 $1,804,354 $1,587,120
Net Assets consist of:
Capital(par value and
paid-in surplus)* $ 2,015,292 $ 2,352,772 $1,199,220 $1,199,846 $1,524,605 $1,351,727
Undistributed net investment
income/(distribution in excess)* -- 6,472 185 (258) 17,449 (218)
Undistributed net realized
gain/(loss)* from investments 530,087 (19,118) 221,449 86,212 60,375 98,898
Unrealized appreciation/
(depreciation) of investments 450,372 402,686 332,347 264,676 201,925 136,713
$ 2,995,751 $ 2,742,812 $1,753,201 $1,550,476 $1,804,354 $1,587,120
Transactions in Fund Shares:
Shares sold 14,963 18,884 2,726 3,425 30,276 44,162
Reinvested distributions 317 3,935 1,668 3,191 3,647 920
Total 15,280 22,819 4,394 6,616 33,923 45,082
Shares repurchased (28,999) (54,669) (4,273) (11,777) (27,454) (17,530)
Net increase/(decrease) (13,719) (31,850) 121 (5,161) 6,469 27,552
Shares outstanding beginning of period 113,164 145,014 29,332 34,493 58,786 31,234
Shares outstanding end of period 99,445 113,164 29,453 29,332 65,255 58,786
Purchases and Sales of Investment Securities:
(excluding Short-Term Securities)
Purchases of Securities $ 3,795,717 $ 2,884,133 $1,633,385 $1,511,361 $2,232,128 --
Proceeds from Sales of Securities 4,044,252 3,540,706 1,605,945 1,727,718 1,920,061 --
Purchases of Long-Term U.S.
Government Obligations -- -- -- -- -- --
Proceeds from Sales of Long-Term
U.S. Government Obligations -- 67,473 -- -- -- --
</TABLE>
AN EXPLANATION OF THE STATEMENT OF CHANGES IN NET ASSETS
This financial statement reports the increase or decrease in the Funds' net
assets during the reporting period. Changes in the Funds' net assets are
attributable to investment operations, dividends, distributions, and capital
share transactions. This schedule is of importance to investors because it shows
exactly what caused the Funds' net asset size to change during the period.
Investors can use this information to determine if the Funds' growth was a
result of operations or an increase in the number of shares being purchased.
The first section summarizes the information from the Statement of
Operations regarding changes in net assets due to the Funds' investment
performance. The Funds' net assets will also change as a result of dividend and
capital gains distributions to investors. If investors receive their dividends
in cash, money is taken out of the Fund to pay the distribution. If investors
reinvest their dividends, the Funds' net assets will not be affected. If you
compare each Funds' "Net decrease from dividends and distributions" to the
"Reinvested dividends and distributions," you'll notice that dividend
distributions had little effect on each Funds' net assets. This is because the
majority of Janus investors reinvest their distributions.
The reinvestment of dividends is included under "Capital Share
Transactions." "Capital Shares" refers to the money investors contribute to the
Funds through purchases or withdraw via redemptions. The Funds' net assets will
increase and decrease in value as investors purchase and redeem shares from the
Fund.
The section titled "Net Assets Consist of" breaks down the components of
the Funds' net assets. Since funds must distribute substantially all earnings,
you'll notice that a significant portion of net assets is shareholder capital.
- ----------------------------------
(1) Period May 2, 1994 (inception) to October 31, 1994
*See Note 3 in Notes to Financial Statements
See Notes to Financial Statements
Janus Funds October 31, 1995 Annual Report
39
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
For a share outstanding for the
year ended October 31, 1995 Janus Fund
or throughout each fiscal year
or period ended October 31 1995 1994 1993 1992 1991
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 19.62 $ 20.81 $ 18.86 $ 18.27 $ 13.25
Income from investment operations
Net investment income .16 .17 .26 .23 .25
Net gains or (losses) on securities
(both realized and unrealized) 3.99 (.03) 2.88 1.46 5.09
Total from investment operations 4.15 .14 3.14 1.69 5.34
Less distributions
Dividends (from net investment income) (.01) (.39)+ (.29) (.19) (.31)
Distributions (from capital gains) (.39) (.94) (.90) (.91) (.01)
Total distributions (.40) (1.33) (1.19) (1.10) (.32)
Net asset value, end of period $ 23.37 $ 19.62 $ 20.81 $ 18.86 $ 18.27
Total return** 21.62% 0.75% 17.41% 9.35% 40.95%
Net assets, end of period
(in thousands) $ 11,962,970 $ 9,647,245 $ 9,098,000 $ 4,989,299 $ 2,597,866
Average net assets for the period
(in thousands) $ 10,559,806 $ 9,338,807 $ 7,335,871 $ 3,870,923 $ 1,784,627
Ratio of expenses to average net assets*(9) 0.87% 0.91% 0.92% 0.97% 0.98%
Ratio of net investment income to
average net assets* 1.25% 1.12% 1.55% 1.54% 1.77%
Portfolio turnover rate* 118% 139% 127% 153% 132%
</TABLE>
<TABLE>
<CAPTION>
For a share outstanding for the
year ended October 31, 1995 Janus Twenty Fund
or throughout each fiscal year
or period ended October 31 1995 1994 1993 1992(1) 1991(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 24.24 $ 25.85 $ 22.75 $ 22.17 $ 18.88
Income from investment operations
Net investment income .01 .16 .17 .09 .11
Net gains or (losses) on securities
(both realized and unrealized) 5.94 (1.07) 3.31 .49 3.62
Total from investment operations 5.95 (.91) 3.48 .58 3.73
Less distributions
Dividends (from net investment income) (.07) (.25) (.18) -- (.02)
Distributions (from capital gains) -- (.45) (.20) -- (.42)
Total distributions (.07) (.70) (.38) -- (.44)
Net asset value, end of period $ 30.12 $ 24.24 $ 25.85 $ 22.75 $ 22.17
Total return** 24.67% (3.52%) 15.39% 2.62%** 19.60%
Net assets, end of period
(in thousands) $ 2,995,751 $ 2,742,812 $ 3,748,796 $ 2,434,245 $ 2,080,922
Average net assets for the period
(in thousands) $ 2,716,278 $ 3,051,194 $ 3,545,727 $ 2,221,065 $ 1,187,646
Ratio of expenses to average net assets*(9) 1.00% 1.02% 1.05% 1.12% 1.01%
Ratio of net investment income
to average net assets* 0.62% 0.57% 0.87% 1.27% 1.08%
Portfolio turnover rate* 147% 102% 99% 79% 83%
</TABLE>
<TABLE>
<CAPTION>
For a share outstanding for the
year ended October 31, 1995 Janus Venture Fund
or throughout each fiscal year
or period ended October 31 1995 1994 1993 1992(3) 1991(4)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 52.86 $ 53.25 $ 47.74 $ 45.96 $ 45.05
Income from investment operations
Net investment income .05 .11 .66 .17 .36
Net gains or (losses) on securities
(both realized and unrealized) 9.49 4.40 6.72 1.61 4.23
Total from investment operations 9.54 4.51 7.38 1.78 4.59
Less distributions
Dividends (from net investment income) (.03) (.53) (1.16) -- (.25)
Distributions (from capital gains) (2.84) (4.37) (.71) -- (3.43)
Total distributions (2.87) (4.90) (1.87) -- (3.68)
Net asset value, end of period $ 59.53 $ 52.86 $ 53.25 $ 47.74 $ 45.96
Total return** 19.24% 9.23% 15.76% 3.87%** 9.90%
Net assets, end of period
(in thousands) $ 1,753,201 $ 1,550,476 $ 1,836,657 $ 1,544,531 $ 1,510,471
Average net assets for the period
(in thousands) $ 1,612,514 $ 1,562,521 $ 1,792,532 $ 1,496,106 $ 1,381,628
Ratio of expenses to average net assets*(9) 0.92% 0.96% 0.97% 1.07% 1.00%
Ratio of net investment income
to average net assets* 0.29% 0.27% 1.29% 1.32% 1.20%
Portfolio turnover rate* 113% 114% 139% 124% 166%
</TABLE>
AN EXPLANATION OF THE FINANCIAL HIGHLIGHTS
This schedule provides a per share breakdown of the components that affect
the Funds' NAV for the current and past reporting periods. Not only does this
table provide you with total return, it also reports total distributions, asset
size, expense ratios and portfolio turnover rate.
The first line in the table reflects the Funds' NAV per share at the
beginning of the fiscal period. The next line reports the Funds' net investment
income per share which is comprised of dividends and interest income earned on
securities held by the Fund. Dividends and distributions are then subtracted to
arrive at the NAV per share at the end of the fiscal period.
Also included in the Financial Highlights is the Funds' expense ratio, or
the percentage of net assets that was used to cover operating expenses during
the period. Expense ratios vary across the Funds for a number of reasons
including the differences in management fees, average shareholder account size,
the frequency of dividend payments, and the extent of foreign investments, which
entail greater transaction costs.
The next line reports the ratio of net investment income, which is the
income earned divided by the average net assets of the Fund during the reporting
period. Don't confuse this ratio with a Funds' yield. The net investment income
ratio is not a true measure of a Funds' yield because it doesn't take into
account the dividends distributed to the Funds' investors.
The last ratio provided in this table is the portfolio turnover rate, which
measures the amount of buying and selling activity in the Funds' portfolio.
Portfolio turnover is affected by market conditions, changes in the size of a
Fund, the nature of the Funds' investments, and the investment style of the
portfolio manager. A 100% rate implies that an amount equal to the value of the
entire portfolio is turned over in a year; a 50% rate means that an amount equal
to the value of half the portfolio is traded in a year; and a 200% rate would
mean that an amount equal to the value of the portfolio is sold in an average of
six months.
- ---------------------------------
(1) Fiscal period June 1, 1992 to October 31, 1992
(2) Fiscal year ended on May 31st
(3) Fiscal period August 1, 1992 to October 31, 1992
(4) Fiscal year ended on July 31
(5) Fiscal period from September 1, 1992 (inception) to October 31, 1992
(6) Fiscal period from May 15, 1991 (inception) to October 31, 1991
(7) Fiscal period from May 3, 1993 (inception) to October 31, 1993
(8) Fiscal period from May 2, 1994 (inception) to October 31, 1994
(9) See Note 4 in Notes to Financial Statements
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
+Distribution in excess of financial statement income of $.02
Janus Funds October 31, 1994 Annual Report
40
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
For a share outstanding for the year
ended October 31, 1995 Janus Balanced Fund
or throughout each fiscal year
or period ended October 31 1995 1994 1993 1992(5)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 12.17 $ 12.23 $ 10.64 $ 10.00
Income from investment operations
Net investment income .61 .27 .19 --
Net gains or (losses) on securities
(both realized and unrealized) 1.52 (.09) 1.56 .64
Total from investment operations 2.13 .18 1.75 .64
Less distributions
Dividends (from net investment income) (.58) (.24) (.16) --
Distributions (from capital gains) -- -- -- --
Total distributions (.58) (.24) (.16) --
Net asset value, end of period $ 13.72 $ 12.17 $ 12.23 $ 10.64
Total return** 18.26% 1.51% 16.54% 6.40%**
Net assets, end of period
(in thousands) $ 124,545 $ 93,546 $ 72,547 $ 2,130
Average net assets for the period
(in thousands) $ 107,259 $ 86,361 $ 43,522 $ 563
Ratio of expenses to average net assets*(9) 1.35% 1.42% 1.70% 2.50%
Ratio of net investment income
to average net assets* 2.52% 2.28% 2.15% (0.12%)
Portfolio turnover rate* 185% 167% 131% 130%
</TABLE>
***********************
<TABLE>
<CAPTION>
For a share outstanding for the year
ended October 31, 1995 Janus Enterprise Fund
or throughout each fiscal year
or period ended October 31 1995 1994 1993 1992(5)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 24.43 $ 21.87 $ 17.09 $ 15.00
Income from investment operations
Net investment income .52 (.06) .04 --
Net gains or (losses) on securities
(both realized and unrealized) 3.09 3.18 4.76 2.09
Total from investment operations 3.61 3.12 4.80 2.09
Less distributions
Dividends (from net investment income) (.52) (.02) (.02) --
Distributions (from capital gains) (.38) (.54) -- --
Total distributions (.90) (.56) (.02) --
Net asset value, end of period $ 27.14 $ 24.43 $ 21.87 $ 17.09
Total return** 15.46% 14.56% 28.09% 13.93%**
Net assets, end of period
(in thousands) $ 459,370 $ 370,028 $ 239,334 $ 8,320
Average net assets for the period
(in thousands) $ 407,791 $ 269,595 $ 188,345 $ 1,560
Ratio of expenses to average net assets*(9) 1.26% 1.25% 1.36% 2.50%
Ratio of net investment income
to average net assets* 0.02% (.032% 0.14% (0.81%)
Portfolio turnover rate* 194% 193% 201% 53%
</TABLE>
***********************
<TABLE>
<CAPTION>
For a share outstanding for the
year ended October 31, 1995 Janus Growth and Income Fund
or throughout each fiscal year
or period ended October 31 1995 1994 1993 1992 1991(6)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 14.69 $ 15.24 $ 12.95 $ 12.13 $ 10.00
Income from investment operations
Net investment income .11 .19 .14 .17 .02
Net gains or (losses) on securities
(both realized and unrealized) 3.43 (.31) 2.29 .80 2.13
Total from investment operations 3.54 (.12) 2.43 .97 2.15
Less distributions
Dividends (from net investment income) (.10) (.10) (.14) (.15) (.02)
Distributions (from capital gains) -- (.33) -- -- --
Total distributions (.10) (.43) (.14) (.15) (.02)
Net asset value, end of period $ 18.13 $ 14.69 $ 15.24 $ 12.95 $ 12.13
Total return** 24.20% (0.76%) 18.81% 7.98% 21.50%**
Net assets, end of period
(in thousands) $ 582,963 $ 489,942 $ 518,963 $ 243,509 $ 56,473
Average net assets for the period
(in thousands) $ 498,442 $ 499,831 $ 404,285 $ 156,815 $ 21,279
Ratio of expenses to average net assets*(9) 1.19% 1.22% 1.28% 1.52% 2.33%
Ratio of net investment income
to average net assets* 1.11% 1.26% 1.13% 1.61% 0.76%
Portfolio turnover rate* 195% 123% 138% 120% 14%
</TABLE>
***************************
<TABLE>
<CAPTION>
For a share outstanding for the
year ended October 31, 1995 Janus Mercury Fund
or throughout each fiscal year
or period ended October 31 1995 1994 1993(7)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 14.12 $ 11.70 $ 10.00
Income from investment operations
Net investment income .16 .02 (.01)
Net gains or (losses) on securities
(both realized and unrealized) 3.37 2.40 1.71
Total from investment operations 3.53 2.42 1.70
Less distributions
Dividends (from net investment income) (.16) -- --
Distributions (from capital gains) (.11) -- --
Total distributions (.27) -- --
Net asset value, end of period $ 17.38 $ 14.12 $ 11.70
Total return** 25.53% 20.68% 17.00%**
Net assets, end of period
(in thousands) $1,520,768 $ 596,330 $112,725
Average net assets for the period
(in thousands) $1,116,377 $ 257,726 $67,462
Ratio of expenses to average net assets*(9) 1.14% 1.33% 1.75%
Ratio of net investment income
to average net assets* 0.50% 0.25% (0.40%)
Portfolio turnover rate* 201% 283% 151%
</TABLE>
***************************
For a share outstanding for
the year ended October 31, 1995 Janus Overseas Fund
or throughout each fiscal year
or period ended October 31 1995 1994(8)
- ------------------------------------------------------------------------------
Net asset value, beginning of period $ 10.36 $ 10.00
Income from investment operations
Net investment income .12 (.02)
Net gains or (losses) on securities
(both realized and unrealized) 1.10 .38
Total from investment operations 1.22 .36
Less distributions
Dividends (from net investment income) -- --
Distributions (from capital gains) -- --
Total distributions -- --
Net asset value, end of period $ 11.58 $ 10.36
Total return** 11.78% 3.60%**
Net assets, end of period
(in thousands) $ 110,866 $ 64,065
Average net assets for the period
(in thousands) $ 77,668 $ 36,645
Ratio of expenses to average net assets*(9) 1.76% 2.16%
Ratio of net investment income
to average net assets* 0.36% (0.64%)
Portfolio turnover rate* 188% 181%
**********************
<TABLE>
<CAPTION>
For a share outstanding for
the year ended October 31, 1995 Janus Worldwide Fund
or throughout each fiscal year
or period ended October 31 1995 1994 1993 1992 1991(6)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 27.00 $ 24.16 $ 18.95 $ 17.45 $ 15.00
Income from investment operations
Net investment income .81 .15 .14 .16 --
Net gains or (losses) on securities
(both realized and unrealized) 1.39 3.34 5.29 1.39 2.45
Total from investment operations 2.20 3.49 5.43 1.55 2.45
Less distributions
Dividends (from net investment income) (.54) (.27) (.22) -- --
Distributions (from capital gains) (1.01) (.38) -- (.05) --
Total distributions (1.55) (.65) (.22) (.05) --
Net asset value, end of period $ 27.65 $ 27.00 $ 24.16 $ 18.95 $ 17.45
Total return** 8.89% 14.76% 28.79% 9.20% 16.00%**
Net assets, end of period
(in thousands) $ 1,804,354 $ 1,587,120 $ 754,608 $ 160,672 $ 18,423
Average net assets for the period
(in thousands) $ 1,622,142 $ 1,244,194 $ 379,259 $ 79,518 $ 7,344
Ratio of expenses to average net assets*(9) 1.24% 1.12% 1.32% 1.73% 2.50%
Ratio of net investment income
to average net assets* 0.99% 0.42% 0.92% 1.74% 0.02%
Portfolio turnover rate* 142% 158% 124% 147% 40%
</TABLE>
AN EXPLANATION OF THE FINANCIAL HIGHLIGHTS
This schedule provides a per share breakdown of the components that affect
the Funds' NAV for the current and past reporting periods. Not only does this
table provide you with total return, it also reports total distributions, asset
size, expense ratios and portfolio turnover rate.
The first line in the table reflects the Funds' NAV per share at the
beginning of the fiscal period. The next line reports the Funds' net investment
income per share which is comprised of dividends and interest income earned on
securities held by the Fund. Dividends and distributions are then subtracted to
arrive at the NAV per share at the end of the fiscal period.
Also included in the Financial Highlights is the Funds' expense ratio, or
the percentage of net assets that was used to cover operating expenses during
the period. Expense ratios vary across the Funds for a number of reasons
including the differences in management fees, average shareholder account size,
the frequency of dividend payments, and the extent of foreign investments, which
entail greater transaction costs.
The next line reports the ratio of net investment income, which is the
income earned divided by the average net assets of the Fund during the reporting
period. Don't confuse this ratio with a Funds' yield. The net investment income
ratio is not a true measure of a Funds' yield because it doesn't take into
account the dividends distributed to the Funds' investors.
The last ratio provided in this table is the portfolio turnover rate, which
measures the amount of buying and selling activity in the Funds' portfolio.
Portfolio turnover is affected by market conditions, changes in the size of a
Fund, the nature of the Funds' investments, and the investment style of the
portfolio manager. A 100% rate implies that an amount equal to the value of the
entire portfolio is turned over in a year; a 50% rate means that an amount equal
to the value of half the portfolio is traded in a year; and a 200% rate would
mean that an amount equal to the value of the portfolio is sold in an average of
six months.
- ------------------------------------
(1) Fiscal period June 1, 1992 to October 31, 1992
(2) Fiscal year ended on May 31st
(3) Fiscal period August 1, 1992 to October 31, 1992
(4) Fiscal year ended on July 31
(5) Fiscal period from September 1, 1992 (inception) to October 31, 1992
(6) Fiscal period from May 15, 1991 (inception) to October 31, 1991
(7) Fiscal period from May 3, 1993 (inception) to October 31, 1993
(8) Fiscal period from May 2, 1994 (inception) to October 31, 1994
(9) See Note 4 in Notes to Financial Statements
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
+Distribution in excess of financial statement income of $.02
Janus Funds October 31, 1995 Annual Report
41
<PAGE>
NOTES TO SCHEDULE OF INVESTMENTS
* Non-Income producing security
** A portion of this security has been segregated by the custodian to cover
margin or segregation requirements on open futures contracts and/or foreign
currency contracts.
+ Securities are registered pursuant to Rule 144A and may be deemed to be
restricted for resale.
# The Investment Company Act of 1940 defines affiliates as those companies in
which a fund holds 5% or more of the outstanding voting securities.
Following is a summary of the transactions with each such affiliate for the
period ended October 31, 1995:
<TABLE>
<CAPTION>
Purchases Sales Realized Dividend
Shares Cost Shares Cost Gain/(Loss) Income
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Janus Fund
Agco Corp.(1) 1,276,250 $ 54,082,502 -- -- -- $ 13,475
Alexander & Alexander Services, Inc. 830,050 18,983,786 -- -- -- 205,978
Catalina Marketing Corp. 573,150 26,079,806 573,150 $ 26,079,806 $ 5,370,178 --
Champion International Corp. 5,336,225 288,293,109 -- -- -- 261,811
Crown Cork & Seal Co., Inc. 6,417,500 305,739,848 1,762,300 88,054,357 (23,553,919) --
First Data Corp. 2,450,100 132,621,224 -- -- -- 733,060
Nabisco Holdings Corp. - Class A 4,169,500 113,834,129 2,610,125 73,964,829 (1,540,504) 948,190
Paging Network, Inc.(2) 2,228,575 43,301,014 100,000 3,367,573 (43,009) --
Tele Danmark A/S (ADR) - Class B -- -- 4,629,960 115,859,696 1,487,007 1,410,072
UNUM Corp. 1,950,475 83,292,995 298,200 16,243,017 (4,711,301) 5,710,408
Wolters Kluwer N.V 105,994 8,214,212 451,375 28,474,859 12,069,240 4,439,525
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Enterprise Fund
APS Holding Corp. - Class A 122,925 3,217,222 -- -- -- --
Catalytica, Inc. 29,000 131,000 1,126,593 7,858,060 (4,253,410) --
Central European Media Enterprises, Ltd. -- -- 336,675 5,475,696 (354,753) --
Exide Corp. 99,825 4,312,203 649,140 32,127,452 (10,882,583) 52,345
Insignia Financial Group, Inc. - Class A 7,300 151,109 49,900 983,301 137,879 --
Petco Animal Supplies, Inc. 509,400 10,557,991 375,225 5,629,668 1,503,736 --
TheraTech, Inc. 49,305 551,040 76,780 1,178,680 (46,757) --
Trigen Energy Corp. 626,825 12,623,245 -- -- -- 113,049
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Growth and Income Fund
SAP (ADR) 225,000 8,217,000 -- -- -- 31,950
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Mercury Fund
Central European Media Enterprises, Ltd. 30,000 349,650 80,000 1,321,040 (697,040) --
Ciber, Inc. -- -- 61,775 521,257 317,326 --
Rottneros Bruks A.B 7,973,171 12,666,705 -- -- -- 84,248
Samsung Electronics GDS 50,240 4,634,640 50,240 4,634,640 2,942,032 --
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Twenty Fund
Lone Star Steakhouse & Saloon, Inc. 305,000 9,671,623 1,606,700 24,613,989 12,728,690 --
SAP (ADR) 475,000 17,347,000 -- -- -- 67,450
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Venture Fund
ABC Rail Products Corp. 485,000 10,776,374 -- -- -- --
Analysts International Corp. -- -- -- -- -- 210,843
APS Holding Corp. - Class A -- -- 12,750 204,000 129,458 --
Arch Communications Group, Inc. 1,307,025 28,779,519 46,300 849,975 288,314 --
Ashbourne PLC 2,991,816 7,209,160 -- -- -- 23,512
California Amplifier, Inc. 335,700 3,870,259 -- -- -- --
Cambrex Corp. 363,775 14,207,766 13,175 456,938 65,684 18,189
CommNet Cellular, Inc. 524,800 14,558,191 -- -- -- --
DavCo Restaurants, Inc. 100,000 1,303,000 -- -- -- --
Duracraft Corp. 50,000 1,588,634 275,500 10,093,575 (3,664,310) --
Emmis Broadcasting Corp. - Class A -- -- 431,250 6,729,941 1,500,057 --
Employees General Insurance Group, Inc. -- -- 570,000 3,063,750 (712,500) --
Exide Corp. 229,675 10,599,922 313,525 7,990,255 2,277,857 87,326
FinishMaster, Inc. 36,925 457,415 106,300 1,044,300 497,005 --
Heritage Media Corp. - Class A 150,000 3,843,426 127,125 2,180,027 996,775 --
Hammons (John Q.) Hotels, Inc. 460,750 5,805,867 92,200 1,111,932 270,390 --
Keane, Inc. 483,825 10,471,832 -- -- -- --
Klamath First Bancorp, Inc. 697,000 8,773,488 -- -- -- --
Landauer, Inc. -- -- -- -- -- 428,300
Littelfuse, Inc. 15,000 509,375 36,000 877,500 201,625 --
Minerals Technologies, Inc. 170,025 4,760,093 321,275 8,948,947 2,574,356 147,511
Munksjo A. B 2,180,297 19,993,820 17,680 171,980 (32,040) --
Paging Network, Inc.(2) 849,100 18,284,267 126,000 3,462,732 1,098,266 --
Papa John's International, Inc. 394,400 15,785,526 87,500 2,212,983 1,069,154 --
Quality Dining, Inc. 412,000 7,958,500 12,600 140,128 14,121 --
Renters Choice, Inc.(3) 600,000 9,317,921 -- -- -- --
R.P. Scherer Corp. 576,400 23,700,783 91,325 2,718,208 1,684,398 --
Simula, Inc.(4) 524,400 6,778,385 -- -- -- --
U. S. Can Corp. 432,225 8,173,177 542,600 8,352,075 (1,439,979) --
Wisconsin Central Transportation Corp. 94,950 3,764,463 325,000 5,068,029 10,641,355 --
World Acceptance Corp.(5) 75,000 911,250 -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Worldwide Fund
Bajaj Auto, Ltd. 290,670 8,423,139 -- -- -- 24,126
Kinnevik A.B. - Class B 803,052 25,719,968 12,211 323,471 20,499 2,274,219
Korea Mobile Telecommunications, Inc. 329,075 9,747,535 -- -- -- --
Securitas A.B. - Class B -- -- 97,600 3,084,972 (572,377) 595,537
SGL Carbon A.G 453,584 20,410,337 114,880 4,602,899 2,346,350 --
WM-Data A.B. - Class B 258,003 9,297,035 -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Adjusted for 3 for 2 stock split 12/16/94
(2) Adjusted for 2 for 1 stock split 10/2/95
(3) Adjusted for 3 for 2 stock split 5/6/95 and 2 for 1 stock split 10/10/95
(4) Adjusted for 3 for 2 stock split 9/29/95
(5) Adjusted for 3 for 1 stock split 9/1/95
See Notes to Financial Statements
Janus Funds October 31, 1995 Annual Report
42
<PAGE>
NOTES TO FINANCIAL STATEMENTS
The following section describes the organization and significant accounting
policies of the funds and provides more detailed information about the schedules
and tables that appear throughout this report. In addition, the Notes explain
how the funds operate and the methods used in preparing and presenting this
report.
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Janus Investment Fund (the Trust) is registered under the Investment
Company Act of 1940 (the 1940 Act) as a no-load, open-end management investment
company. Nine series of shares ("Equity Funds" or "Funds") included in this
report invest primarily in equity securities. Each Fund is diversified as
defined in the 1940 Act, with the exception of the Janus Enterprise, Janus
Mercury and Janus Twenty Funds, which are non-diversified.
The following policies have been consistently followed by the Funds and are
in conformity with accounting principles generally accepted in the investment
company industry.
INVESTMENT VALUATION
Securities are valued at the closing price for securities traded on a
principal exchange (U.S. or foreign) and on the NASDAQ National Market.
Securities traded on over-the-counter markets and listed securities for which no
sales are reported are valued at the latest bid price obtained from one or more
dealers making a market for such securities or by a pricing service approved by
the Funds' Trustees. Short-term securities maturing within 60 days are valued at
amortized cost, which approximates market value. Foreign securities are
converted to U.S. dollars using exchange rates at the close of the New York
Stock Exchange. When market quotations are not readily available, securities are
valued at their fair value as determined in good faith by the Funds' Trustees.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for as of the date purchased or sold.
Dividend income is recorded on the ex-dividend date. Interest income is recorded
on the accrual basis and includes amortization of discounts and premiums. Gains
and losses are determined on the identified cost basis, which is the same basis
used for federal income tax purposes.
FORWARD FOREIGN CURRENCY TRANSACTIONS AND FUTURES CONTRACTS
The Funds enter into forward exchange currency contracts in order to hedge
their exposure to changes in foreign currency exchange rates on their foreign
portfolio holdings and to hedge certain firm purchase and sale commitments
denominated in foreign currencies. A forward exchange currency contract is a
commitment to purchase or sell a foreign currency at a future date at a
negotiated forward rate. The gain or loss arising from the difference between
the original contract and the closing of such contract is included in net
realized gain or loss on foreign currency transactions.
Currency gain and loss is also calculated on payables and receivables that
are denominated in foreign currencies. The payables and receivables are
generally related to security transactions and income.
Futures contracts are marked to market daily and the variation margin is
recorded as an unrealized gain or loss. When a contract is closed, a realized
gain or loss is recorded equal to the difference between the opening and closing
value of the contract. Generally, open forward and futures contracts are marked
to market for federal income tax purposes at fiscal year-end.
Foreign denominated assets and forward currency contracts may involve more
risks than domestic transactions, including: currency risk, political and
economic risk, regulatory risk, and market risk. Risks may arise from the
potential inability of a counterparty to meet the terms of a contract and from
unanticipated movements in the value of foreign currencies relative to the U.S.
dollar.
The Funds may enter into "futures contracts" and "options" on securities,
financial indices and foreign currencies; forward contracts; and interest rate
swaps and swap-related products. The Funds intend to use such derivative
instruments primarily to hedge or protect from adverse movements in securities
prices, currency rates or interest rates. The use of futures contracts and
options may involve risks such as the possibility of illiquid markets or
imperfect correlation between the value of the contracts and the underlying
securities, or that the counterparty will fail to perform its obligations.
DIVIDEND DISTRIBUTIONS AND EXPENSES
Dividends for Janus Balanced and Janus Growth and Income Funds are declared
and distributed quarterly and capital gains (if any) are distributed annually.
The remaining seven Equity Funds declare and distribute dividends and capital
gains (if any) annually. Each Fund bears expenses incurred specifically on its
behalf as well as a portion of general expenses.
FEDERAL INCOME TAXES
The Funds intend to distribute to shareholders all taxable investment
income and realized gains and otherwise comply with the Internal Revenue Code
applicable to regulated investment companies.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
The advisory agreement with the Funds spells out the expenses that the
Funds must pay. Each of the Funds is subject to the following schedule:
Average Daily Net Annual Rate
Fee Schedule Assets of Fund Percentage (%)
- --------------------------------------------------------------------------------
Equity Funds First $ 30 Million 1.00
Next $270 Million .75
Next $200 Million .70
Over $500 Million .65
- --------------------------------------------------------------------------------
Janus Capital will reduce advisory fees to the extent that a Fund's normal
operating expenses (exclusive of brokerage commissions, interest and taxes)
exceed the most restrictive state limitation, which is believed by the Funds to
be 2 1/2% of the first
Janus Funds October 31, 1995 Annual Report
43
<PAGE>
NOTES TO FINANCIAL STATEMENTS
$30 million, 2% of the next $70 million and 1 1/2% of the balance of a Fund's
average net assets for a fiscal year.
Janus Service Corporation (Janus Service), a wholly owned subsidiary of
Janus Capital, receives an annual fee of $16 per shareholder account for
transfer agent services plus reimbursement of certain out of pocket expenses
(primarily postage and telephone charges).
Officers and certain trustees of the Funds are also officers and/or
directors of Janus Capital; however, they receive no compensation from the
Funds.
DST Systems Inc. (DST), an affiliate of Janus Capital through a degree of
common ownership, provides fund accounting and shareholder accounting systems to
the Funds. DST Securities Inc., a wholly owned subsidiary of DST, is designated
as an introductory broker on certain portfolio transactions. Brokerage
commissions paid to DST Securities Inc. serve to reduce transfer agent fees and
expenses. Investors Fiduciary Trust Company (IFTC), formerly 50% owned by DST,
provides domestic custody services to the Funds. IFTC was deemed to be
affiliated up until late January 1995 when State Street Bank and Trust acquired
it. Brokerage commissions paid, fees reduced, and the net fees paid to DST and
IFTC for the year or period ended October 31, 1995 are noted below.
<TABLE>
<CAPTION>
DST Securities Inc. Fund
Commissions Expense Custodian Fee
Paid* Reduction* DST Fees IFTC Fees Reduction**
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Janus Fund 1,125,368 844,026 2,664,807 455,158 88,231
Janus Balanced Fund 9,143 6,857 80,227 27,841 18,698
Janus Enterprise Fund 96,932 72,699 237,232 46,181 24,723
Janus Growth and Income
Fund 98,373 73,780 304,267 22,172 29,924
Janus Mercury Fund 171,777 128,833 465,952 79,424 26,013
Janus Overseas Fund 2,783 2,087 88,371 10,036 22,495
Janus Twenty Fund 378,575 283,931 1,313,882 23,317 65,554
Janus Venture Fund 143,719 107,789 540,804 108,526 57,607
Janus Worldwide Fund 164,193 123,145 651,417 -- 30,557
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* The difference between commissions paid to DST Securities, Inc. and
expenses reduced constituted commissions paid to an unaffiliated clearing
broker.
** Interest earned on uninvested cash balances which serve to reduce the
custodian fees.
3. FEDERAL INCOME TAX
Gains and losses on forward currency contracts and foreign currency gains
and losses on debt instruments are treated as ordinary income for federal income
tax purposes pursuant to Section 988 of the Internal Revenue Code. Listed below
are such currency gains or losses for the period ended October 31, 1995.
Net capital loss carryovers if any, as of October 31, 1995 are available to
offset future realized capital gains and thereby reduce future taxable gains
distributions. The aggregate cost of investments and the composition of
unrealized appreciation and depreciation of investment securities for federal
income tax purposes as of October 31, 1995 are as follows:
<TABLE>
<CAPTION>
at October 31, 1995 at October 31, 1995
------------------- -------------------------------------------------------------------
Net
Currency Net Capital Loss Federal Tax Unrealized Unrealized Appreciation/
Gains/(Losses) Carryovers Cost Appreciation (Depreciation) (Depreciation)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Janus Fund (61,662,354) - 9,915,190,833 2,392,254,446 (162,747,305) 2,229,507,141
Janus Balanced Fund (352,776) - 111,368,886 10,582,414 (848,830) 9,733,584
Janus Enterprise Fund (1,489,132) - 381,149,594 88,364,354 (6,402,414) 81,961,940
Janus Growth and Income Fund (1,983,992) - 500,741,221 88,623,092 (7,798,035) 80,825,057
Janus Mercury Fund (16,082,534) - 1,349,655,082 200,805,680 (62,389,386) 138,416,294
Janus Overseas Fund 892,101 - 95,172,011 12,732,219 (2,991,130) 9,741,089
Janus Twenty Fund (19,609,912) - 2,519,538,281 507,065,455 (51,409,488) 455,655,967
Janus Venture Fund (4,567,176) - 1,407,054,229 393,634,972 (57,943,116) 335,691,856
Janus Worldwide Fund 3,329,396 - 1,575,050,380 253,375,369 (62,217,002) 191,158,367
</TABLE>
Janus Funds October 31, 1995 Annual Report
44
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Net investment income distributions and capital gains distributions are
determined in accordance with income tax regulations which may differ from
generally accepted accounting principles. These differences are due to differing
treatments for items such as deferral of wash sales, foreign currency
transactions, net operating losses and capital loss carryforwards. Permanent
items identified in the period ended October 31, 1995 have been reclassified
among the components of net assets as follows:
Undistributed Undistributed
Net Investment Net Realized Paid-In
Income Gains/(Losses) Capital
- --------------------------------------------------------------------------------
Janus Fund (53,164,955) 61,685,464 (8,520,509)
Janus Balanced Fund 2,256,929 (2,256,929) --
Janus Enterprise Fund 7,610,792 (7,610,792) --
Janus Growth and Income Fund (1,985,649) 1,985,718 (69)
Janus Mercury Fund 2,639,687 (2,639,687) --
Janus Overseas Fund 892,101 (892,101) --
Janus Twenty Fund (15,977,751) 15,968,327 9,424
Janus Venture Fund (3,447,641) 3,706,161 (258,520)
Janus Worldwide Fund 33,636,893 (33,636,837) (56)
- --------------------------------------------------------------------------------
Net investment income, net realized gains and net assets were not affected by
these changes.
4. EXPENSES
The Fund's expenses may be reduced through expense reduction arrangements.
Those arrangements include the use of broker commissions paid to DST Securities
Inc. and uninvested cash balances earning interest with the Fund's custodian.
The Statements of Operations reflect the total expenses before any offset, the
amount of offset and the net expenses. The expense ratios listed in the
Financial Highlights reflect total expenses prior to any expense offset.
These changes are part of new disclosure requirements beginning this fiscal
year. Prior years do not reflect these changes. Listed in the table are the
expense ratios before and after offsets.
EXPENSE RATIO COMPARISONS FOR FISCAL YEAR OCTOBER 31, 1995
Exense Ratio Actual
Prior to Offsets Expense Ratio
- --------------------------------------------------------------------------------
Janus Fund 0.87% 0.86%
Janus Balanced Fund 1.35% 1.32%
Janus Enterprise Fund 1.26% 1.23%
Janus Growth and Income Fund 1.19% 1.17%
Janus Mercury Fund 1.14% 1.12%
Janus Overseas Fund 1.76% 1.73%
Janus Twenty Fund 1.00% 0.99%
Janus Venture Fund 0.92% 0.91%
Janus Worldwide Fund 1.24% 1.23%
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE TRUSTEES AND SHAREHOLDERS OF JANUS INVESTMENT FUND
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of operations
and of changes in net assets and the financial highlights, present fairly, in
all material respects, the financial position of Janus Fund, Janus Balanced
Fund, Janus Enterprise Fund, Janus Growth and Income Fund, Janus Mercury Fund,
Janus Overseas Fund, Janus Twenty Fund, Janus Venture Fund, and Janus Worldwide
Fund (nine of the portfolios constituting the Janus Investment Fund, hereafter
referred to as the "Funds"), at October 31, 1995, the results of each of their
operations for the year then ended, the changes in each of their net assets and
the financial highlights for each of the periods indicated, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Funds' management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at October 31, 1995 by
correspondence with the custodian and the application of alternative auditing
procedures for unsettled security transactions, provide a reasonable basis for
the opinion expressed above.
Price Waterhouse LLP
Denver, Colorado
November 30, 1995
