1998 SEMIANNUAL REPORT
Janus Equity Funds
JANUS FUND
JANUS BALANCED FUND
JANUS ENTERPRISE FUND
JANUS EQUITY INCOME FUND
JANUS GROWTH AND INCOME FUND
JANUS MERCURY FUND
JANUS OLYMPUS FUND
JANUS OVERSEAS FUND
JANUS SPECIAL SITUATIONS FUND
JANUS TWENTY FUND
JANUS VENTURE FUND
JANUS WORLDWIDE FUND
[LOGO] JANUS
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TABLE OF CONTENTS
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Our Message to You 1
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Portfolio Manager's Commentary and Schedule of Investments
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Janus Fund 2
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Janus Balanced Fund 5
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Janus Enterprise Fund 9
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Janus Equity Income Fund 12
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Janus Growth and Income Fund 15
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Janus Mercury Fund 19
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Janus Olympus Fund 22
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Janus Overseas Fund 25
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Janus Special Situations Fund 30
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Janus Twenty Fund 33
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Janus Venture Fund 36
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Janus Worldwide Fund 40
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Statements of Operations 46
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Statements of Assets and Liabilities 46
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Statements of Changes in Net Assets 48
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Financial Highlights 51
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Notes to Schedules of Investments 56
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Notes to Financial Statements 58
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An Explanation of Performance Information
Performance overview graphs on the following pages 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 lifetime performance of the fund
through April 30, 1998.
When comparing the performance of a fund with 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 stock, 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
is converted into U.S. dollars. Funds that invest 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 Currency Contract Table
A table listing forward currency contracts follows each fund's Schedule of
Investments (if applicable). Forward currency contracts are agreements to
deliver or receive a preset amount of currency at a future date. Forward
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.
<PAGE>
OUR MESSAGE TO YOU
Dear Shareholders:
America's continued healthy economy and a major push toward corporate
restructuring in European markets set the stage for solid global stock market
gains during the first half of our fiscal year, November 1, 1997, to April 30,
1998, despite lingering economic turmoil in Asia. Benchmark domestic and foreign
indexes gained considerably during the period, with some setting new records.
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Standard & Poor's 500 Stock Index 22.50%
Standard & Poor's 400 MidCap Stock Index 19.17%
Russell 2000 Index (small stocks) 11.88%
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All returns include reinvested dividends.
Positive Trends Boost U.S. Markets
Helping push the U.S. stock market to new heights has been an economic era
of moderate growth, low interest rates, minimal inflation, and steady corporate
earnings. Perhaps the best indication of U.S. economic strength was a rise in
gross domestic product - the sum of all goods and services produced in the U.S.
- - from a robust 3.7% in the fourth quarter of 1997 to an even higher 4.2% in the
first three months of '98. Other positive indicators included a surge in
production capacity and an unemployment level that in the first quarter was at a
24-year low.
We've witnessed several trends that continue to help shape this "dream
economy," including tremendous advances in technology, globalization, and
consolidation within certain industries - the latter of which has resulted in a
record level of mergers and acquisitions.
Particularly evident was the wave of consolidations in the banking and
securities industries brought about by government deregulation, economies of
scale, and increased global competition. The proposed mega-merger between
Travelers Group and Citicorp was the first to make headlines in early April. One
week later, NationsBank announced its marriage with BankAmerica, and BancOne
tied the knot with First Chicago.
Mergers and acquisitions in banking and other industries were encouraged by
soaring markets this period. This consolidation in turn enables industries to
improve profitability, which drives individual stock prices higher. As several
of our portfolio managers explain in their letters, many of our stocks benefited
from these events.
Finally, the liquidity of big, brand-name companies continued to capture
the attention of investors. Even though earnings growth among smaller companies
outpaced that of the larger names in recent months, a market awash in cash
seemed intent on staying the course.
Strong Markets Abroad
Because of the economic downturn in Asia, resulting in a sharp decrease in
commodity prices, global inflationary pressures were reduced. Consequently, many
global markets responded favorably.
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MSCI EAFE Index(1) 15.44%
MSCI World Index(1) 18.86%
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Regardless of its positive effects on the overall global economy, I
continue to view Asia with less optimism. The Japanese government is in the
midst of developing a reform package necessary to stimulate its economy, which
in turn may help move the economies of other Asian countries. However, Japanese
companies have been ineffective in enacting the same corporate restructuring
strategies and shareholder value reforms that have made U.S. companies the envy
of the world. And although this has presented a buying opportunity for Asian
stocks, we remain cautious and selective about our investments there.
While certain stocks were hit by Asia's economic woes, especially those in
the oil services sector and some bellwether technology stocks, most markets
generally managed to avoid the worst of the "Asian Flu." However, I suspect its
harshest shock waves may not be felt until the second half of 1998. In
anticipation of this possibility and as part of our long-standing goal to keep
our funds flexible in the face of potential economic turbulence, we've redoubled
our research efforts so that we're confident our stock selections should hold
their own in any market environment.
The economies of Continental Europe gained momentum during the last six
months, fueled primarily by corporate prosperity in the United Kingdom,
particularly in the pharmaceutical and banking industries. Companies there
mirrored the successful restructuring and consolidation themes initiated in the
U.S. and were rewarded by significant earnings growth. European holdings in the
information technology sector also helped to boost returns in several of our
funds, as explained in greater detail by some of our portfolio managers.
I believe the buoyancy in European markets was also linked to a progression
toward a common currency known as the Euro and a collective movement toward
lower and more closely aligned interest rates. Together, these trends played
what I believe was perhaps the most conspicuous role in propelling many European
markets.
Looking Ahead
While I anticipate that benign inflation and low interest rates could set
the stage for healthy global markets in the months ahead, our team of analysts
and portfolio managers will continue to keep a close eye on corporate earnings
growth, which was surprisingly slim considering the stock market's rally this
period. Some market observers believe the seemingly lofty levels of today's
stock markets account for expectations of a resurgence in corporate
profitability during the second half of the year. But if earnings fail to
rebound in the third and fourth quarters, markets could quickly become
vulnerable.
At Janus, however, we are not swayed by overall market sentiment. And
earnings reports are only "the tip of the iceberg," because our investment
selections are based on solid company fundamentals positioned to prevail in any
market scenario. We're confident our in-depth, hands-on method of research will
continue to help us identify these fundamentals, enabling us to find the best
investment opportunities for your money.
With that said, I want to thank you for the confidence you've placed in us.
Sincerely,
/s/ Tom Bailey
Tom Bailey
Chairman
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(1) Both index returns include net dividends reinvested. Net dividends are
those dividends that remain to be reinvested after foreign tax obligations
are met. Tax obligations vary from country to country. EAFE stands for
Europe, Australasia, and the Far East. Neither the U.S. nor the emerging
markets of Latin America and Eastern Europe are represented in EAFE. The
MSCI World Index contains North America, Europe, and the Asia/Pacific
Region.
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 1
<PAGE>
JANUS FUND Portfolio Manager, James P. Craig
Janus Fund posted a gain of 20.01% for the six months ended April 30, 1998.
I am not pleased to have trailed the Standard & Poor's 500 Index, which returned
a total of 22.50% (both returns include reinvested dividends), but I am
encouraged by changes made during the period that had an increasingly positive
effect on results.
The Fund has been restructured to focus more on higher earnings growth. I
believe the days of easy gains from P/E-multiple expansion are behind us. Going
forward, the companies that stay afloat are likely to be the ones that can
exceed earnings expectations.
A Market Again Led by Large Caps
As Tom Bailey pointed out in his letter, large companies continued to
capture investors' interest during the past six months. Following the crisis in
Asia that began last summer, the U.S. markets bounced back, with the very
largest of stocks leading the way.
Taking advantage of the volatility, I divested some of our financial
services and consumer nondurable stocks and reinvested in technology businesses.
I focused on companies with strong franchises (i.e., those with the highest
barriers to entry) that also had solid long-term stories.
Among the technology positions augmented were market-dominating companies
like Microsoft, Cisco Systems - a leading manufacturer of networking equipment -
and Parametric Technology. We also invested in Cadence Design Systems, a maker
of semiconductor-manufacturing software, and Maxim Integrated Products, a
high-value-added supplier of analog semiconductors. Finally, we began building a
position in Applied Materials, Inc., the world's leading supplier of
semiconductor fabrication systems and services.
Strong Performance by Media and Drug Stocks
I'm very optimistic about new areas within the cable industry, such as
telephone, Internet, and digital cable services. The delivery systems for these
new products (i.e., the cable systems) are already in place in most parts of the
country. Now there is a great opportunity for companies to provide new services
via these existing systems and thereby generate tremendous additional cash flow.
With this in mind, the portfolio management team beefed up our investment
in media conglomerate Time Warner and cable TV companies Tele-Communications,
Inc., Comcast, and Media One (formerly part of U.S. West). All three sustained
their impressive runs as Wall Street came to better understand both their
individual prospects and the growth potential for their industry.
Another medium that we like is radio, where revenues are on the rise and
consolidation is making the business more efficient. Advertisers are shifting
from network TV and other more expensive media to radio. Meanwhile, new
regulations allow companies to own up to half of a radio market. The result is
increased profitability at companies like CBS, Chancellor Media, and Clear
Channel Communications.
Our pharmaceutical holdings continue to provide great performance overall.
Nonetheless, we shifted our positions to keep the focus on the biggest companies
with the strongest R&D and delivery systems. We strengthened positions in
Warner-Lambert and Pfizer, which continue to be successful in introducing new
products, and trimmed our SmithKline Beecham holding while eliminating our
position in Bristol-Myers Squibb.
A More Flexible Approach
During the past year, I have adjusted my strategy slightly in response to
the higher P/Es of recent years, which could continue as long as the economy and
corporate profits remain steady and interest rates are low. I find myself
holding the Fund's winners a bit longer and buying more aggressively when I'm
persuaded by the evidence that a company can grow earnings faster than generally
expected.
One result is a more focused fund, which can mean greater volatility.
However, I'm confident in the quality of our investments. We're spending even
more time on the road, face to face with corporate CEOs, clients, and
competitors, to ensure that we own companies with the strongest market share in
fast-growing industries.
Unfortunately, even a deep understanding of a company's fundamental
strengths is not always a defense against broad change. For instance, our most
significant challenge during the period involved the oil industry. Approximately
7% of the Fund's assets were invested in oil services stocks when oil prices
collapsed this winter. We were caught off guard and were admittedly slow to
react. We essentially liquidated our holdings at cost, but this was well below
their values at the beginning of the period.
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Portfolio Profile April 30, 1998 October 31, 1997
Equities 96.2% 97.4%
Foreign 11.8% 18.6%
European 11.2% 17.6%
Top 10 Equities (% of Assets) 35.2% 25.9%
Number of Stocks 68 110
Cash & Cash Equivalents 3.8% 2.6%
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Top 10 Equity Holdings April 30, 1998 October 31, 1997
Microsoft Corp. 4.6% 2.6%
Cisco Systems, Inc. 4.5% 2.6%
Monsanto Co. 3.7% 3.4%
CBS Corp. 3.7% --
Time Warner, Inc. 3.3% 0.8%
Comcast Corp. - Special Class A 3.2% 0.6%
Tele-Communications, Inc. - Class A 3.1% 2.3%
Parametric Technology Co. 3.1% 1.8%
Cadence Design Systems, Inc. 3.1% 2.0%
Warner-Lambert Co. 2.9% 2.5%
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Top 5 Industries April 30, 1998 October 31, 1997
Computer Software 10.7% 6.4%
Diversified Operations 9.1% 9.8%
Medical - Drugs 9.1% 8.4%
Cable Television 9.0% 3.0%
Money Center Banks 6.9% 4.8%
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A Truly Global Marketplace
I don't believe we've felt the full impact from the falloff in Asia.
However, I believe the growth in the U.S. and Europe should outweigh these
effects. In fact, the implosion of these Asian economies has been bullish for
U.S. stocks because it has held down prices and inflationary pressures.
I continue to watch carefully the strength of the economy and to look for
any ramifications on interest rates. While I'm optimistic rates will stay at
present levels, I also keep an eye out for any signs that they might move up,
which could be dangerous for the markets.
In closing, I would like to thank you for investing in Janus Fund.
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Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 2
<PAGE>
JANUS FUND Portfolio Manager, James P. Craig
Performance Overview
GRAPHIC
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 blue
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 April 30, 1998. The upper
right quadrant reflects the ending value of the hypothetical investment in Janus
Fund ($917,186) as compared to the S&P 500 Index ($374,604). 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 39.48%, 19.12%, 19.64% and 17.35%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS FUND April 30, 1998 (unaudited)
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Shares or
Principal Amount Market Value
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Common Stock - 96.2%
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Agricultural Biotechnology - 3.7%
15,523,925 Monsanto Co. $ 820,827,534
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Applications Software - 0.5%
2,292,800 PeopleSoft, Inc.* 106,615,200
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Automotive - Truck Parts and Equipment - 1.0%
3,543,300 Federal-Mogul Corp.# 229,207,219
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Cable Television - 9.0%
19,959,300 Comcast Corp. - Special Class A# 714,792,431
1,439,437 Cox Communications, Inc. - Class A* 64,234,876
21,226,431 Tele-Communications, Inc. - Class A* 684,552,400
13,787,860 US WEST Media Group* 520,491,715
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1,984,071,422
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Chemicals - Diversified - 5.1%
8,047,615 E.I. du Pont de Nemours and Co. 585,966,967
26,300,000 Imperial Chemical Industries PLC 477,553,296
1,705,460 Solutia, Inc. 48,392,428
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1,111,912,691
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Chemicals - Specialty - 0.7%
2,750,725 Cytec Industries, Inc.*,# 150,602,194
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Circuits - 1.8%
3,956,135 Analog Devices, Inc.* 154,042,007
3,101,715 Linear Technology Corp. 249,688,058
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403,730,065
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Commercial Banks - 1.3%
1,976,795 Northern Trust Corp. 144,306,035
2,288,000 Star Banc Corp. 144,573,000
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288,879,035
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Commercial Services - 0.8%
5,565,280 Gartner Group, Inc. - Class A*,# $ 184,349,900
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Computer Software - 10.7%
18,606,420 Cadence Design Systems, Inc.*,# 675,645,626
11,234,980 Microsoft Corp.* 1,012,552,573
21,147,000 Parametric Technology Co.*,# 676,043,156
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2,364,241,355
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Computers - Integrated Systems - 0.3%
2,125,000 Wang Laboratories, Inc.*,# 57,375,000
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Computers - Micro - 0.9%
2,404,705 Dell Computer Corp.* 194,179,929
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Containers - Paper and Plastic - 0.3%
1,053,975 Sealed Air Corp.* 66,268,678
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Cruise Lines - 1.0%
3,194,425 Carnival Corp. - Class A 222,212,189
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Diversified Financial Services - 0.8%
2,312,900 Associates First Capital Corp. - Class A 172,889,275
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Diversified Operations - 9.1%
22,903,600 CBS Corp.* 815,940,750
4,167,200 General Electric Co. 354,732,900
9,422,818 Siebe PLC 214,267,343
941,200 Textron, Inc. 73,648,900
10,225,700 Tyco International, Ltd. 557,300,650
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2,015,890,543
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Drug Delivery Systems - 0.3%
1,587,500 ALZA Corp.* 76,100,781
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Electronic Components - Semiconductors - 5.5%
4,722,720 Applied Materials, Inc.* 170,608,260
11,256,900 Maxim Integrated Products, Inc.*,# 454,497,338
9,005,575 Texas Instruments, Inc. 576,919,648
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1,202,025,246
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See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 3
<PAGE>
JANUS FUND April 30, 1998 (unaudited)
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Shares or
Principal Amount Market Value
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Finance - Consumer Loans - 2.0%
1,399,150 Beneficial Corp. $ 182,414,181
2,018,905 Household International, Inc. 265,359,826
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447,774,007
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Finance - Investment Bankers/Brokers - 2.9%
7,950,937 Charles Schwab Corp. 278,282,795
4,569,770 Morgan Stanley, Dean Witter, Discover and Co. 360,440,609
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638,723,404
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Finance - Other Services - 0.6%
2,885,363 Newcourt Credit Group, Inc. 141,743,457
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Human Resources - 0.7%
2,798,868 Robert Half International, Inc.* 151,488,731
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Internet Software - 1.0%
2,731,600 America Online, Inc.* 218,528,000
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Life and Health Insurance - 1.4%
137,505 Schweizerische Lebensversicherungs-und
Rentenanstalt 116,333,883
3,588,179 UNUM Corp.# 192,864,621
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309,198,504
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Medical - Drugs - 9.1%
5,309,555 Astra A.B. - Class A 109,088,955
2,689,565 Eli Lilly and Co. 187,092,865
52,078 Novartis A.G. 86,105,738
5,316,050 Pfizer, Inc. 605,032,941
1,770,850 Schering-Plough Corp. 141,889,356
19,426,531 SmithKline Beecham PLC 229,677,529
3,426,950 Warner-Lambert Co. 648,336,103
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2,007,223,487
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Medical - Wholesale Drug Distributors - 1.1%
2,431,037 Cardinal Health, Inc. 233,987,311
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Money Center Banks - 6.9%
8,683,590 Bank of New York Co., Inc. 512,874,534
1,961,650 BankAmerica Corp. 166,740,250
13,470,291 Barclays PLC 388,735,356
456,250 Citicorp 68,665,625
11,022,027 Lloyds TSB Group PLC 165,398,742
129,789 UBS 209,055,178
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1,511,469,685
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Multimedia - 3.9%
3,135,550 Meredith Corp.# 134,828,650
9,348,596 Time Warner, Inc. 733,864,786
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868,693,436
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Networking Products - 4.5%
13,427,600 Cisco Systems, Inc.* 983,571,700
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Pharmacy Services - 0.5%
3,204,860 Omnicare, Inc. 109,766,455
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Printing - Commercial - 0.2%
1,084,100 World Color Press, Inc.* 34,691,200
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Publishing - Books - 2.1%
3,561,781 Wolters Kluwer N.V.**,# 465,557,953
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Radio - 2.5%
7,602,520 Chancellor Media Corp.*,# 360,644,543
2,002,304 Clear Channel Communications, Inc.* 188,717,152
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549,361,695
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Retail - Discount - 1.6%
6,245,475 Costco Companies, Inc.* 348,965,916
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Telephone - Long Distance - 1.8%
3,248,040 AT&T Corp. $ 195,085,403
4,928,725 WorldCom, Inc.* 210,857,016
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405,942,419
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Television - 0.6%
3,292,289 Univision Communications, Inc. - Class A*,# 126,135,822
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Total Common Stock (cost $14,749,607,225) 21,204,201,438
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Money Market - 0%
Janus Government Money Market Fund
$ 6,000,000 5.58% (cost $6,000,000) 6,000,000
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Short-Term Corporate Notes - 0.9%
CIT Holdings
150,200,000 5.51%, 5/1/98 150,200,000
Norwest Corp.
50,000,000 5.49%, 5/15/98 49,893,250
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Total Short-Term Corporate Notes (amortized cost $200,093,250) 200,093,250
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Time Deposit - 0.5%
First Union Bank North Carolina EDT
120,000,000 5.50%, 5/1/98 (cost $120,000,000) 120,000,000
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U.S. Government Agencies - 1.7%
Fannie Mae:
50,000,000 5.43%, 5/13/98 49,909,500
50,000,000 5.75%, 5/13/98 49,378,500
50,000,000 5.70%, 6/8/98 49,720,278
50,000,000 5.70%, 6/30/98 49,549,500
50,000,000 5.75%, 7/21/98 49,393,500
50,000,000 5.75%, 7/24/98 49,371,000
75,000,000 5.75%, 7/30/98 73,988,250
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Total U.S. Government Agencies (cost $371,333,264) 371,310,528
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Total Investments (total cost $15,447,033,739) - 99.3% 21,901,605,216
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Cash, Receivables and Other Assets, net of Liabilities - 0.7% 146,061,967
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Net Assets - 100% $22,047,667,183
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Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
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Canada 0.6% $ 141,743,457
Netherlands 2.1% 465,557,953
Sweden 0.5% 109,088,955
Switzerland 1.9% 411,494,799
United Kingdom 6.8% 1,475,632,266
United States++ 88.1% 19,298,087,786
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Total 100.0% $21,901,605,216
================================================================================
++Includes Short-Term Securities (84.9% excluding Short-Term Securities)
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
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Dutch Guilder 7/23/98 450,000,000 $ 223,702,525 ($1,639,311)
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Total $ 223,702,525 ($1,639,311)
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 4
<PAGE>
JANUS BALANCED FUND Portfolio Manager, Blaine P. Rollins
I'm glad to report that Janus Balanced Fund continued to post solid returns
this period. The Fund gained 14.00% during the first half of our fiscal year,
November 1, 1997, to April 30, 1998, versus a 22.50% increase by the S&P 500
Index. In addition, the Lehman Brothers Government/Corporate Bond Index gained
3.64% during the period. All returns include reinvested dividends.
For the 12 months ended April 30, 1998, Janus Balanced Fund ranked 29th out
of 365 balanced funds tracked by Lipper Analytical Services, Inc., a leading
mutual fund rating company.(1)
True to its name, Janus Balanced Fund maintained about 40% to 60% each of
stocks and income-producing securities this period. However, stocks primarily
drove the Fund's performance as the U.S. stock market was propelled upward by
low interest rates, benign inflation, and a reevaluation of events in Asia.
Consolidation Trend Buoys Stocks
As Tom Bailey mentioned in his letter, industry consolidation was a trend
that continued to evolve during this half of the year. I was thrilled by the
Fund's participation in this trend via its media and pharmaceutical stocks. A
reduction in capital expenditures, a concentration in assets for research and
product development, and streamlined delivery channels were a few of the
positive effects these companies experienced as a result.
I was especially pleased by the strong performance of CBS Corporation and
believe it excelled as a direct result of consolidation. Acquisitions within the
radio industry in particular allowed management to leverage a fixed-cost
structure by sharing advertising staff and reducing overhead. The bottom line
was improved margins and accelerated profits.
Recent merger and acquisition activity in the pharmaceutical industry has
indicated the beginning of what I believe will be a long-term trend in this
area. The attempted merger of SmithKline Beecham and Glaxo Wellcome illustrates
the growing need to control costs and focus research in order to enhance
profits. Although the merger fell through and our SmithKline Beecham stock
retreated somewhat from its highs, I was still satisfied by the stock's overall
performance this period, but ultimately eliminated this position.
Other investments that met my expectations were in the technology, retail,
and travel industries. Leaders in these areas of the market demonstrated a
history of predictable earnings, strong cash flow, and shareholder-oriented
management.
Falling short of my expectations were oil stocks, hit hard as a result of
lagging demand from the Pacific Rim and conflicts within OPEC about production
volume. Several major oil producers consequently cut back on exploration,
drilling, and production this period. I therefore eliminated positions in the
oil services equipment and deep-water offshore drilling segments, taking losses
in Schlumberger Ltd. and Transocean Offshore.
Fixed-Income Investments Remain Solid
On the fixed-income side of the Fund, our investments provided solid yields
and appreciation. I lengthened the Fund's duration to the 7- to 10-year range on
prospects of continued low interest rates. The quality of these fixed-income
investments is still extremely high as the Fund maintained positions in U.S.
Treasuries and investment-grade corporate bonds. And in an effort to enhance the
overall risk/return profile of the Fund, I continue to look for opportunities to
add yield through convertibles, such as our Houston Industries holding, which,
in addition to its 4.5% yield, should provide us with a 90% upside movement with
Time Warner common stock.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 47.8% 51.9%
Fixed-Income Securities
U.S. Treasury Notes 12.4% 18.2%
Investment-Grade
Corporate Bonds 8.6% 6.3%
High-Yield Corporate Bonds 12.6% 8.0%
Foreign Corporate Bonds -- 1.4%
Preferred Stock 16.7% 10.6%
Top 10 Equities (% of Assets) 20.0% 16.6%
Number of Stocks 54 87
Cash & Cash Equivalents 1.9% 3.6%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Comcast Corp. - Special Class A 3.8% --
Dell Computer Corp. 2.4% 0.8%
Schweizerishe Lebensversicherungs
-und Rentenanstalt 2.0% 2.4%
Dionex Corp. 1.9% 2.5%
Maxim Integrated Products, Inc. 1.8% --
Cisco Systems, Inc. 1.8% 1.0%
Texas Instruments, Inc. 1.7% --
Linear Technology Corp. 1.6% --
Charles Schwab Corp. 1.5% 1.1%
Morgan Stanley, Dean Witter,
Discover and Co. 1.5% --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Cruise Lines 5.8% 4.4%
Cable Television 5.4% 4.2%
Electric - Integrated 5.1% --
Telecommunication Services 4.9% --
Computer Software 4.0% 3.0%
- --------------------------------------------------------------------------------
Outlook Remains Positive
Going forward, I believe economic growth in the U.S. will continue at a
decent pace. More than likely, the situation in Asia should keep a lid on U.S.
interest rates, creating a positive environment for our stocks. Further, I
believe that deflationary pressures from the Far East will likely lower the
price of goods and commodities.
Overall, I am confident in our investments and believe we are
well-positioned to enjoy solid earnings gains going forward. To ensure this, I
will continue visiting companies, talking directly with management teams, and
generally adhering to the in-depth, hands-on research that enables us to keep
uncovering great ideas.
I appreciate your confidence in our abilities and thank you for your
investment in Janus Balanced Fund.
- --------------------------------------------------------------------------------
(1) A balanced fund is defined by Lipper as "a fund whose primary objective is
to conserve principal by maintaining at all times a balanced fund of both
stocks and bonds. Typically the stock/bond ratio ranges around 60%/40%." As
of April 30, 1998, Janus Balanced Fund ranked 16/249 of balanced funds for
the 3-year period, and 11/123 for the 5-year period. Lipper's ranking is
based on total return, including reinvestment of dividends and capital
gains for the stated period.
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 5
<PAGE>
JANUS BALANCED FUND Portfolio Manager, Blaine P. Rollins
Performance Overview
GRAPHIC
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 Brothers
Government/Corporate Bond Index. Janus Balanced Fund is represented by a solid
blue line. The S&P 500 Index is represented by a single dashed black line. The
Lehman Brothers Government/Corporate Bond Index is represented by a single
dotted black line. The "y" axis reflects the value of the investment. The "x"
axis reflects the computation periods from inception, September 1, 1992, through
April 30, 1998. The upper right quadrant reflects the ending value of the
hypothetical investment in Janus Balanced Fund, ($24,997) as compared to the S&P
500 Index ($30,751) and the Lehman Brothers Government/Corporate Bond Index
($14,934). There is a legend in the upper left quadrant of the graph which
indicates Janus Balanced Fund's one-year, five-year and since inception
(September 1, 1992) average annual total returns as 31.79%, 16.59% and 17.55%,
respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS BALANCED FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 47.8%
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 0.7%
65,175 Monsanto Co. $ 3,446,128
- --------------------------------------------------------------------------------
Airlines - 0.6%
88,325 Ryanair Holdings PLC (ADR)* 3,389,472
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 1.1%
88,050 Federal-Mogul Corp. 5,695,734
- --------------------------------------------------------------------------------
Cable Television - 3.8%
553,041 Comcast Corp. - Special Class A 19,805,781
- --------------------------------------------------------------------------------
Chemicals - Diversified - 1.0%
186,625 Solutia, Inc. 5,295,484
- --------------------------------------------------------------------------------
Circuits - 1.6%
102,530 Linear Technology Corp. 8,253,665
- --------------------------------------------------------------------------------
Commercial Banks - 1.7%
62,975 Northern Trust Corp. 4,597,175
68,825 Star Banc Corp. 4,348,880
- --------------------------------------------------------------------------------
8,946,055
- --------------------------------------------------------------------------------
Commercial Services - 0.6%
93,375 Gartner Group, Inc. - Class A* 3,093,047
- --------------------------------------------------------------------------------
Computer Software - 4.0%
159,575 Cadence Design Systems, Inc.* 5,794,567
67,300 Microsoft Corp.* 6,065,412
154,900 Parametric Technology Co.* 4,951,959
116,050 Wind River Systems* 4,018,231
- --------------------------------------------------------------------------------
20,830,169
- --------------------------------------------------------------------------------
Computers - Micro - 2.4%
154,595 Dell Computer Corp.* 12,483,546
- --------------------------------------------------------------------------------
Containers - Paper and Plastic - 0.3%
24,550 Sealed Air Corp.* 1,543,581
- --------------------------------------------------------------------------------
Cruise Lines - 2.2%
67,950 Carnival Corp. - Class A $ 4,726,772
61,675 Royal Caribbean Cruises, Ltd. 4,217,028
157,905 Royal Olympic Cruise Lines, Inc.* 2,901,504
- --------------------------------------------------------------------------------
11,845,304
- --------------------------------------------------------------------------------
Diversified Operations - 2.3%
198,525 CBS Corp.* 7,072,453
64,850 Roper Industries, Inc. 2,010,350
143,441 Siebe PLC 3,261,734
- --------------------------------------------------------------------------------
12,344,537
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 3.5%
237,940 Maxim Integrated Products, Inc.* 9,606,828
135,750 Texas Instruments, Inc. 8,696,484
- --------------------------------------------------------------------------------
18,303,312
- --------------------------------------------------------------------------------
Electronic Safety Devices - 0.3%
20,225 Pittway Corp. - Class A 1,511,819
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 0.8%
16,745 Beneficial Corp. 2,183,129
13,630 Household International, Inc. 1,791,493
- --------------------------------------------------------------------------------
3,974,622
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 3.0%
230,200 Charles Schwab Corp. 8,057,000
99,965 Morgan Stanley, Dean Witter, Discover and Co. 7,884,739
- --------------------------------------------------------------------------------
15,941,739
- --------------------------------------------------------------------------------
Finance - Other Services - 0.7%
71,815 HealthCare Financial Partners, Inc.* 3,617,681
- --------------------------------------------------------------------------------
Human Resources - 1.1%
83,512 Robert Half International, Inc.* 4,520,087
40,025 Romac International, Inc.* 1,060,663
- --------------------------------------------------------------------------------
5,580,750
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 6
<PAGE>
JANUS BALANCED FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Instruments - Scientific - 1.9%
184,325 Dionex Corp.* $ 9,838,347
- --------------------------------------------------------------------------------
Life and Health Insurance - 2.0%
12,602 Schweizerische Lebensversicherungs-und
Rentenanstalt 10,661,718
- --------------------------------------------------------------------------------
Medical - Drugs - 1.8%
23,100 Pfizer, Inc. 2,629,069
35,825 Warner-Lambert Co. 6,777,642
- --------------------------------------------------------------------------------
9,406,711
- --------------------------------------------------------------------------------
Money Center Banks - 3.2%
107,315 Bank of New York Co., Inc. 6,338,292
186,280 Barclays PLC 5,375,802
352,987 Lloyds TSB Group PLC 5,296,993
- --------------------------------------------------------------------------------
17,011,087
- --------------------------------------------------------------------------------
Multimedia - 0.4%
44,725 Meredith Corp. 1,923,175
- --------------------------------------------------------------------------------
Music/Clubs - 0.6%
103,320 Steinway Musical Instruments, Inc.* 3,157,718
- --------------------------------------------------------------------------------
Networking Products - 1.8%
127,050 Cisco Systems, Inc.* 9,306,412
- --------------------------------------------------------------------------------
Power Converters and Power Supply Equipment - 0.5%
83,050 American Power Conversion Corp.* 2,673,172
- --------------------------------------------------------------------------------
Radio - 0.8%
92,440 Heftel Broadcasting Corp. - Class A* 4,055,805
- --------------------------------------------------------------------------------
Retail - Discount - 1.0%
91,700 Costco Companies, Inc.* 5,123,738
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 0.3%
39,900 Fred Meyer, Inc.* 1,790,513
- --------------------------------------------------------------------------------
Schools - 0.5%
83,880 Apollo Group, Inc. - Class A* 2,872,890
- --------------------------------------------------------------------------------
Television - 1.0%
140,377 Univision Communications, Inc. - Class A* 5,378,194
- --------------------------------------------------------------------------------
Toys - 0.3%
38,575 Mattel, Inc. 1,477,905
- --------------------------------------------------------------------------------
Total Common Stock (cost $189,550,108) 250,579,811
- --------------------------------------------------------------------------------
Corporate Bonds - 21.2%
- --------------------------------------------------------------------------------
Cable Television - 1.6%
$4,500,000 Adelphia Communications Corp., 8.375%
senior notes, due 2/1/08 4,466,250
4,000,000 Lenfest Communications, Inc., 7.625%
senior notes, due 2/15/08 3,990,000
- --------------------------------------------------------------------------------
8,456,250
- --------------------------------------------------------------------------------
Chemicals - Diversified - 1.3%
6,725,000 E.I. du Pont de Nemours and Co., 6.75%
notes, due 9/1/07 6,943,562
- --------------------------------------------------------------------------------
Circuits - 0.9%
2,500,000 Analog Devices, Inc., 3.50%
subordinated notes, due 12/1/00 4,737,500
- --------------------------------------------------------------------------------
Computers - Mainframe - 0.8%
4,000,000 IBM Corp., 6.375%
notes, due 6/15/00 4,035,000
- --------------------------------------------------------------------------------
Computers - Micro - 1.6%
8,175,000 Dell Computer Corp., 6.55%
senior notes, due 4/15/08 8,185,219
- --------------------------------------------------------------------------------
Cruise Lines - 0.6%
Royal Caribbean Cruises, Ltd.:
2,050,000 7.00% senior notes, due 10/15/07 2,083,312
1,100,000 6.75% senior notes, due 3/15/08 1,087,625
- --------------------------------------------------------------------------------
3,170,937
- --------------------------------------------------------------------------------
Distribution and Wholesale - 0.9%
$5,000,000 Aviation Sales Co., 8.125%
senior subordinated notes, due 2/15/08 $ 4,900,000
- --------------------------------------------------------------------------------
Finance - Other Services - 0.3%
1,800,000 Sears, Roebuck Acceptance Corp., 6.50%
notes, due 6/15/00 1,813,500
- --------------------------------------------------------------------------------
Medical - Drugs - 0.8%
4,075,000 Warner-Lambert Co., 6.00%
notes, due 1/15/08 3,978,219
- --------------------------------------------------------------------------------
Multimedia - 2.3%
8,000,000 Time Warner, Inc., 8.11%
notes, due 8/15/06 8,720,000
3,400,000 Walt Disney Co. (The), 6.375%
senior notes, due 3/30/01 3,442,500
- --------------------------------------------------------------------------------
12,162,500
- --------------------------------------------------------------------------------
Radio - 2.4%
8,000,000 Chancellor Media Corp., 8.125%
senior subordinated notes, due 12/15/07 8,010,000
6,000,000 Jacor Communications, Inc., zero coupon
senior notes, due 6/12/11 4,642,500
- --------------------------------------------------------------------------------
12,652,500
- --------------------------------------------------------------------------------
Real Estate Development - 0.3%
1,500,000 Avatar Holdings, Inc., 7.00%
subordinated notes, due 4/1/05 1,642,500
- --------------------------------------------------------------------------------
Rental Auto/Equipment - 0.5%
2,525,000 Ryder TRS, Inc., 10.00%
senior subordinated notes, due 12/1/06 2,708,063
- --------------------------------------------------------------------------------
Retail - Music Store - 0.6%
3,020,000 MTS, Inc., 9.375%
senior subordinated notes, due 5/1/05+ 3,020,000
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 0.9%
5,000,000 Fred Meyer, Inc., 7.45%
senior notes, due 3/1/08 4,987,500
- --------------------------------------------------------------------------------
Telecommunication Services - 4.9%
14,475,000 Level 3 Communications, Inc., 9.125% senior
notes, due 5/1/08 14,330,250
Qwest Communications International, Inc.:
2,410,000 10.875% senior notes, due 4/1/07 2,801,625
12,200,000 zero coupon senior discount notes,
due 2/1/08 8,372,250
- --------------------------------------------------------------------------------
25,504,125
- --------------------------------------------------------------------------------
Television - 0.5%
2,250,000 Sinclair Broadcast Group, Inc., 10.00%
senior subordinated notes, due 9/30/05 2,385,000
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $110,969,223) 111,282,375
- --------------------------------------------------------------------------------
Preferred Stock - 16.7%
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 1.8%
130,000 Federal-Mogul Financial Trust, 7.00%+ 9,376,250
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 2.3%
65,019 TCI Pacific Communications, 5.00% 11,865,968
- --------------------------------------------------------------------------------
Cruise Lines - 3.0%
143,753 Royal Caribbean Cruises, Ltd., 7.25% 15,794,861
- --------------------------------------------------------------------------------
Diversified Operations - 1.3%
2,700,000 Williams Holdings PLC, 8.00% 7,087,608
- --------------------------------------------------------------------------------
Electric - Integrated - 5.1%
388,375 Houston Industries, Inc., 7.00% 26,943,516
- --------------------------------------------------------------------------------
Telephone - Local - 3.2%
225,365 US WEST Communications Group, 4.50% 16,789,693
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $70,567,368) 87,857,896
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 7
<PAGE>
JANUS BALANCED FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
U.S. Government Obligations - 12.4%
U.S. Treasury Notes:
$ 7,950,000 6.375%, due 5/15/99 $ 8,013,362
3,000,000 6.00%, due 6/30/99 3,015,690
5,150,000 5.75% due 10/31/00 5,167,716
5,000,000 6.625%, due 4/30/02 5,168,600
10,000,000 5.75%, due 10/31/02 10,031,200
9,000,000 6.625%, due 5/15/07 9,542,160
23,275,000 6.125%, due 8/15/07 23,893,882
- --------------------------------------------------------------------------------
Total U.S. Government Obligations (cost $63,858,046) 64,832,610
- --------------------------------------------------------------------------------
Total Investments (total cost $434,944,745) - 98.1% 514,552,692
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 1.9% 10,145,199
- --------------------------------------------------------------------------------
Net Assets - 100% $ 524,697,891
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Ireland 0.6% $ 3,389,472
Switzerland 2.1% 10,661,718
United Kingdom 4.1% 21,022,137
United States 93.2% 479,479,365
- --------------------------------------------------------------------------------
Total 100.0% $ 514,552,692
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 8
<PAGE>
JANUS ENTERPRISE FUND Portfolio Manager, James P. Goff
I'm glad to report that Janus Enterprise Fund regained substantial momentum
for the six-month period ended April 30, 1998, posting returns of 18.15%. In
comparison, the Standard and Poor's MidCap 400 Index gained 19.17%. Both returns
include reinvested dividends.
Holding fast to my strategy of investing in midsize companies with dominant
market presence and a history of predictable earnings growth paid off this
period. During recent months, the market has begun to recognize the true value
of many of our companies, and, as a result, the Fund's performance improved.
Earnings Growth Perseveres
These encouraging developments occurred despite the continued
outperformance of large-cap stocks over their small and midsize counterparts,
which Tom Bailey mentioned in his letter. I'd like to expand on Tom's comments
in an effort to explain why our outlook is positive.
The annual return for the S&P 500 Index during the past five years has
averaged almost 20% - double its historical average of 10%. Because investors
have been able to find robust earnings growth in the largest, most liquid
stocks, the market has been unwilling to pay a premium for growth from mid-cap
stocks. However, heavy exposure to Asia and exhausted efforts to improve margins
have slowed S&P 500 earnings growth dramatically to the mid-single digits. In
contrast, the top 20 holdings in Janus Enterprise Fund delivered a weighted
average earnings increase of 35% during the first quarter of '98. These
companies have limited exposure to Asia and have less economic sensitivity;
therefore, I believe they will continue to deliver exceptional earnings growth.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 97.3% 98.3%
Foreign 11.5% 18.3%
Top 10 Equities (% of Assets) 42.1% 41.4%
Number of Stocks 61 79
Cash & Cash Equivalents 2.7% 1.7%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Apollo Group, Inc. - Class A 5.4% 2.9%
Fastenal Co. 5.0% 6.1%
Progressive Corp. 4.3% 1.4%
Chancellor Media Corp. 4.2% 1.2%
Omnicare, Inc. 4.2% 4.0%
J.D. Wetherspoon PLC 4.1% 6.6%
Paychex, Inc. 4.0% 3.4%
Heftel Broadcasting
Corp. - Class A 3.9% 1.6%
PizzaExpress PLC 3.8% 5.5%
Cadence Design Systems, Inc. 3.2% --
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Radio 10.7% 5.5%
Schools 5.5% 2.9%
Computer Software 5.1% 1.1%
Retail - Building Products 5.0% 6.1%
Property and Casualty Insurance 4.3% 1.4%
- --------------------------------------------------------------------------------
Fund Composition Changes Slightly
Changes to the Fund during the first half of the fiscal year included
increased weightings in the life sciences sector as additional research
resources helped uncover several strong, mid-cap pharmaceutical companies. We
also added to the Fund's technology position, although we remain underweighted
relative to our benchmark.
One technology stock we added to the Fund that I'm particularly excited
about is Cadence Design Systems, which was up 48% since the first of the year.
Cadence is the dominant provider of software and services used to create new
semiconductor designs. Demand for the company's products continues to grow
steadily, even when the semiconductor business slows. This is a result of the
strong competition between semiconductor companies to develop advanced products
and their dependency upon software to do so.
Although it's not a new position, America Online (AOL) led the performance
among our technology holdings. As the leading provider of Internet access and
content, AOL is larger than its fifteen nearest competitors combined. The
company has leveraged its dominant brand among Internet access providers with
new revenue streams generated through advertising, commerce, and a long distance
service now offered to AOL subscribers.
We trimmed our exposure in retail stocks during the period. This included
selling our Papa John's holding, which, despite the fact that it continued to
post strong results, I opted to sell when the stock rose and other, more
compelling opportunities became available. Another retail stock we sold was
Petco Animal Supplies, which suffered from problems related to a recent
acquisition.
Outlook Remains Cautious, but Optimistic
The Asian economic crisis has helped to lower interest rates and ease
inflationary pressures around the world, which resulted in robust stock markets
this period. However, I believe two things actually drive stock prices --
interest rates and earnings. Even though we have yet to see any sign of
inflation, the labor markets remain tight in this late stage of our expansion,
and wages are an important underpinning for inflationary pressures. A modest
uptick in these pressures could upset the bond market, which would send yields
higher.
As I mentioned earlier, the downturn in Asia, rising labor costs, and the
strength of the dollar are beginning to slow earnings growth among larger
companies, yet growth among our holdings remains strong. As a result, the Fund
is positioned to benefit from investors shifting toward companies that are
generating higher relative growth.
I thank you for your continued investment in Janus Enterprise Fund, and I
am committed to meeting and exceeding your performance expectations.
- --------------------------------------------------------------------------------
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 9
<PAGE>
JANUS ENTERPRISE FUND Portfolio Manager, James P. Goff
Performance Overview
GRAPHIC
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Enterprise Fund and the S&P 400 MidCap Index. Janus Enterprise Fund is
represented by a solid blue line. The S&P 400 MidCap 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 April 30, 1998. The upper right quadrant reflects the ending value of
the hypothetical investment in Janus Enterprise Fund ($28,843) as compared to
the S&P 400 MidCap Index ($29,051). There is a legend in the upper left quadrant
of the graph which indicates Janus Enterprise Fund's one-year, five-year and
since inception (September 1, 1992) average annual total returns as 43.04%,
17.59% and 20.56%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS ENTERPRISE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 97.3%
- --------------------------------------------------------------------------------
Advertising Sales - 1.9%
359,098 Outdoor Systems, Inc.* $ 11,401,362
- --------------------------------------------------------------------------------
Airlines - 1.3%
197,016 Ryanair Holdings PLC (ADR)* 7,560,489
- --------------------------------------------------------------------------------
Applications Software - 1.0%
127,930 PeopleSoft, Inc.* 5,948,745
- --------------------------------------------------------------------------------
Cable Television - 2.7%
189,620 Comcast Corp. - Special Class A 6,790,766
249,039 US WEST Media Group* 9,401,222
- --------------------------------------------------------------------------------
16,191,988
- --------------------------------------------------------------------------------
Cellular Telecommunications - 0.8%
241,475 Western Wireless Corp. - Class A 4,708,762
- --------------------------------------------------------------------------------
Circuits - 3.2%
274,790 SIPEX Corp.* 5,461,451
234,770 Vitesse Semiconductor Corp.* 13,543,294
- --------------------------------------------------------------------------------
19,004,745
- --------------------------------------------------------------------------------
Commercial Banks - 4.3%
11,985 First Empire State Corp. 6,112,350
139,210 Northern Trust Corp. 10,162,330
140,090 Star Banc Corp. 8,851,937
- --------------------------------------------------------------------------------
25,126,617
- --------------------------------------------------------------------------------
Commercial Services - 4.2%
47,745 Gartner Group, Inc. - Class A* 1,581,553
431,922 Paychex, Inc. 23,458,764
- --------------------------------------------------------------------------------
25,040,317
- --------------------------------------------------------------------------------
Computer Software - 5.1%
511,790 Cadence Design Systems, Inc.* $ 18,584,374
363,040 Parametric Technology Co.* 11,605,935
- --------------------------------------------------------------------------------
30,190,309
- --------------------------------------------------------------------------------
Containers - Paper and Plastic - 0.5%
46,335 Sealed Air Corp.* 2,913,313
- --------------------------------------------------------------------------------
Cruise Lines - 1.2%
100,077 Royal Caribbean Cruises, Ltd. 6,842,765
- --------------------------------------------------------------------------------
Diversified Financial Services - 2.7%
149,875 American Capital Strategies, Ltd. 3,390,922
203,922 HealthCare Financial Partners, Inc.* 10,272,571
79,130 Heller Financial, Inc.* 2,136,510
- --------------------------------------------------------------------------------
15,800,003
- --------------------------------------------------------------------------------
Drug Delivery Systems - 1.2%
144,170 ALZA Corp.* 6,911,149
- --------------------------------------------------------------------------------
Electric - Generation - 2.8%
303,515 AES Corp.* 16,750,234
- --------------------------------------------------------------------------------
Electric Products - 0.7%
154,015 Littelfuse, Inc.* 3,888,879
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 1.5%
219,640 Maxim Integrated Products, Inc.* 8,867,965
- --------------------------------------------------------------------------------
Electronic Connectors - 0.5%
121,023 Berg Electronics Corp.* 2,881,860
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 1.2%
234,005 Medallion Financial Corp. 6,990,899
- --------------------------------------------------------------------------------
Finance - Credit Card - 0.5%
32,285 Capital One Financial Corp. 3,101,378
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 1.8%
298,492 Charles Schwab Corp. 10,447,220
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 10
<PAGE>
JANUS ENTERPRISE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Finance - Leasing Companies - 0.5%
46,705 FINOVA Group, Inc. $ 2,735,162
- --------------------------------------------------------------------------------
Finance - Mortgage Loan Banker - 0.6%
309,815 Capital Trust - Class A* 3,485,419
- --------------------------------------------------------------------------------
Finance - Other Services - 0.1%
6,665 Newcourt Credit Group, Inc. 327,418
- --------------------------------------------------------------------------------
Food - Confectionary - 0.5%
34,000 Wrigley (Wm.) Jr., Co. 3,026,000
- --------------------------------------------------------------------------------
Garden Products - 0.7%
233,385 Metromedia International Group, Inc.* 3,880,026
- --------------------------------------------------------------------------------
Human Resources - 2.7%
1,581,195 Capita Group PLC** 13,284,884
48,620 Robert Half International, Inc.* 2,631,558
- --------------------------------------------------------------------------------
15,916,442
- --------------------------------------------------------------------------------
Internet Content - 0.3%
49,090 At Home Corp. - Class A* 1,635,311
- --------------------------------------------------------------------------------
Internet Software - 2.5%
185,905 America Online, Inc.* 14,872,400
- --------------------------------------------------------------------------------
Life and Health Insurance - 0.5%
83,320 Protective Life Corp. 3,093,255
- --------------------------------------------------------------------------------
Medical - Drugs - 2.0%
220,144 Medimmune, Inc.* 11,612,596
- --------------------------------------------------------------------------------
Medical - Generic Drugs - 1.1%
152,740 Watson Pharmaceuticals, Inc.* 6,567,820
- --------------------------------------------------------------------------------
Medical Instruments - 2.1%
144,895 Sofamor Danek Group, Inc.* 12,714,536
- --------------------------------------------------------------------------------
Music/Clubs - 0.1%
12,870 SFX Entertainment, Inc. - Class A* 444,015
- --------------------------------------------------------------------------------
Pharmacy Services - 4.2%
725,740 Omnicare, Inc. 24,856,595
- --------------------------------------------------------------------------------
Property and Casualty Insurance - 4.3%
187,675 Progressive Corp. 25,418,233
- --------------------------------------------------------------------------------
Publishing - Periodicals - 0.4%
122,795 Ziff-Davis, Inc.* 2,210,310
- --------------------------------------------------------------------------------
Radio - 10.7%
527,665 Chancellor Media Corp.* 25,031,108
132,750 Clear Channel Communications, Inc.* 12,511,688
529,510 Heftel Broadcasting Corp. - Class A* 23,232,251
41,615 Jacor Communications, Inc.* 2,366,853
- --------------------------------------------------------------------------------
63,141,900
- --------------------------------------------------------------------------------
Resorts and Theme Parks - 1.5%
164,885 Premier Parks, Inc.* 9,171,728
- --------------------------------------------------------------------------------
Retail - Building Products - 5.0%
530,635 Fastenal Co. 29,682,395
- --------------------------------------------------------------------------------
Retail - Catalog Shopping - 1.3%
87,395 Barnett, Inc.* 1,769,749
114,959 MSC Industrial Direct Co., Inc. - Class A* 5,848,539
- --------------------------------------------------------------------------------
7,618,288
- --------------------------------------------------------------------------------
Retail - Pubs - 4.1%
4,511,337 J.D. Wetherspoon PLC** 24,288,317
- --------------------------------------------------------------------------------
Retail - Restaurants - 3.8%
1,722,290 PizzaExpress PLC** 22,497,413
- --------------------------------------------------------------------------------
Schools - 5.5%
932,852 Apollo Group, Inc. - Class A* 31,950,164
16,140 DeVry, Inc.* 611,303
- --------------------------------------------------------------------------------
32,561,467
- --------------------------------------------------------------------------------
Super-Regional Banks - 0.9%
32,800 Fleet Financial Group, Inc. $ 2,833,100
64,410 KeyCorp 2,556,272
- --------------------------------------------------------------------------------
5,389,372
- --------------------------------------------------------------------------------
Telecommunication Equipment - 0.3%
40,000 RELTEC Corp.* 1,595,000
- --------------------------------------------------------------------------------
Television - 2.5%
388,858 Univision Communications, Inc. - Class A* 14,898,122
- --------------------------------------------------------------------------------
Total Common Stock (cost $417,207,377) 574,208,539
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 2.8%
Household Finance Corp.
$ 16,400,000 5.51%, 5/1/98 (amortized cost $16,400,000) 16,400,000
- --------------------------------------------------------------------------------
Total Investments (total cost $433,607,377) - 100.1% 590,608,539
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (0.1%) (692,907)
- --------------------------------------------------------------------------------
Net Assets - 100% $ 589,915,632
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Canada -- $ 327,418
Ireland 1.3% 7,560,489
United Kingdom 10.2% 60,070,613
United States++ 88.5% 522,650,019
- --------------------------------------------------------------------------------
Total 100.0% $ 590,608,539
================================================================================
++Includes Short-Term Securities (85.7% excluding Short-Term Securities)
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 5/11/98 10,697,000 $ 17,876,826 ($344,351)
British Pound 8/14/98 1,000,000 1,663,700 (30,300)
British Pound 10/7/98 13,200,000 21,910,680 (25,080)
- --------------------------------------------------------------------------------
Total $ 41,451,206 ($399,731)
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 11
<PAGE>
JANUS EQUITY INCOME FUND Portfolio Manager, Blaine P. Rollins
During the first half of our fiscal year, November 1, 1997, to April 30,
1998, Janus Equity Income Fund returned 19.90%, while the Standard & Poor's 500
Index gained 22.50% for the same period. Both returns include reinvested
dividends.
I'm also pleased to report that for the 12 months ending April 30, 1998,
the Fund ranked 11th out of 197 equity income funds tracked by Lipper Analytical
Services, Inc., a leading mutual fund rating company.(1)
I continued to follow a strategy this period that included investing in
income-producing equity securities of smaller, lesser-known companies as well as
large industry leaders. Because I saw the best income opportunities in the big,
brand-name companies, I leaned more toward large-cap stocks, which once again
outperformed their smaller counterparts during the half.
Industry Leaders Continue to Excel
Microsoft, Cisco Systems, and Dell Computer Corp. are all large-caps that
contributed substantially to the Fund's overall performance. One reason I'm
enthusiastic about Dell is because I believe it may have one of the best
business models in its industry. This company builds computers to customer
specifications, thus eliminating the need to maintain inventory. During the
first quarter alone, Dell recorded a 61% increase in its stock price.
One-on-one meetings with the CEOs and CFOs of most of our technology
holdings over the last six months reaffirmed my confidence in this industry as a
core segment within the Fund, and I increased weightings in these companies as a
result.
In regard to our retail stocks, we experienced significant appreciation
during the half in part because of negative events in Asia. Investors sought
refuge from the "Asian Flu" in this somewhat insulated business segment, and
valuations of these stocks rose. Upon passing our price targets, I sold some of
these positions at a significant profit, including Family Dollar and Dayton
Hudson. I did, however, hold onto a few other stocks that had higher multiples
because of their proven capacity to produce value at consistently positive
rates.
Unfortunately, the downturn in the Far East had a very different effect on
the oil services industry. These stocks were hit by lagging demand from Asia in
addition to conflicts within OPEC and the warmest winter on record. I
consequently eliminated the Fund's position in this industry at a loss.
Consolidation Boosts Individual Stock Performance
Industry consolidation was a popular theme this period and had a positive
influence on several of our stocks in the media, pharmaceutical, and travel
industries. In particular, I found developments in the drug sector made for one
of the most interesting consolidation stories. Industry-wide research and
development dollars are increasingly becoming diluted and undisciplined as a
result of too many companies chasing too many products. However, the combined
focus of Pfizer's and Warner-Lambert's research and development and delivery
channels is a step toward rectifying the problem and has boosted my confidence
in the future earnings of these companies.
On the income side of things, I continue to seek investments that offer
steady dividends and appreciation. Many of our holdings provided both of these
results, helping to enhance the Fund's risk/return profile. I'm also looking for
ways to add yield through convertibles, such as with Houston Industries, which
is one of our largest fixed-income positions.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 68.4% 87.6%
Fixed-Income Securities
Investment-Grade
Corporate Bonds 4.5% 0.8%
High-Yield/High-Risk
Corporate Bonds 2.9% --
Preferred Stock 19.1% 6.5%
Top 10 Equities (% of Assets) 27.1% 23.7%
Number of Stocks 57 111
Cash & Cash Equivalents 5.1% 5.1%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Comcast Corp. - Special Class A 5.0% --
Dell Computer Corp. 3.0% 1.2%
Maxim Integrated Products, Inc. 2.7% 0.4%
Univision Communications, Inc.
- Class A 2.7% --
Schweizerishe Lebensverischerungs
- und Rentenanstalt 2.5% 3.4%
Linear Technology Corp. 2.5% 0.5%
Heftel Broadcasting Corp.
- Class A 2.3% --
Texas Instruments, Inc. 2.2% 1.6%
Morgan Stanley, Dean Witter,
Discover and Co. 2.1% --
Cisco Systems, Inc. 2.1% 1.2%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Cable Television 10.8% 4.5%
Money Center Banks 6.5% 3.5%
Computer Software 5.3% 4.2%
Telephone - Local 5.2% 1.9%
Circuits 5.0% 0.9%
- --------------------------------------------------------------------------------
Going Forward
My outlook for the economy is generally favorable. I anticipate that ailing
Asian economies will help keep prices down on imports in the U.S., and low
interest rates combined with dormant inflation should provide an environment in
which financial markets thrive.
Having said that, I remain committed to investing in businesses that should
do well despite economic and market pressures. Our fundamental, bottom-up
analysis combined with in-depth, hands-on research is what ultimately leads us
to these companies and is responsible for the solid results this fund has
delivered to date.
In closing, I'd like to express my appreciation for your continued
investment in Janus Equity Income Fund.
- --------------------------------------------------------------------------------
(1) An equity income fund is defined by Lipper as "a fund which seeks
relatively high current income and growth of income through investing 60%
or more of its portfolio in equities." Lipper's ranking is based on total
return, including reinvestment of dividends and capital gains for the
stated period.
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 12
<PAGE>
JANUS EQUITY INCOME FUND Portfolio Manager, Blaine P. Rollins
Performance Overview
GRAPHIC
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Equity Income Fund and the S&P 500 Index. Janus Equity Income Fund is
represented by a solid blue 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, June 28, 1996, through
April 30, 1998. The upper right quadrant reflects the ending value of the
hypothetical investment in Janus Equity Income Fund ($17,569) as compared to the
S&P 500 Index ($17,142). There is a legend in the upper left quadrant of the
graph which indicates Janus Equity Income Fund's one-year and since inception
(June 28, 1996) average annual total returns as 43.56% and 35.99%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS EQUITY INCOME FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 68.4%
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 0.7%
17,275 Monsanto Co. $ 913,416
- --------------------------------------------------------------------------------
Airlines - 1.2%
43,125 Ryanair Holdings PLC (ADR)* 1,654,922
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 0.9%
19,980 Federal-Mogul Corp. 1,292,456
- --------------------------------------------------------------------------------
Cable Television - 5.1%
193,509 Comcast Corp. - Special Class A 6,930,041
6,887 Tele-Communications, Inc. - Class A* 222,106
- --------------------------------------------------------------------------------
7,152,147
- --------------------------------------------------------------------------------
Chemicals - Diversified - 2.3%
17,585 E.I. du Pont de Nemours and Co. 1,280,408
65,545 Solutia, Inc. 1,859,839
- --------------------------------------------------------------------------------
3,140,247
- --------------------------------------------------------------------------------
Circuits - 2.5%
42,840 Linear Technology Corp. 3,448,620
- --------------------------------------------------------------------------------
Commercial Banks - 2.5%
2,695 First Empire State Corp. 1,374,450
15,715 Northern Trust Corp. 1,147,195
15,150 Star Banc Corp. 957,291
- --------------------------------------------------------------------------------
3,478,936
- --------------------------------------------------------------------------------
Commercial Services - 0.9%
36,950 Gartner Group, Inc. - Class A* 1,223,969
- --------------------------------------------------------------------------------
Computer Software - 5.3%
56,535 Cadence Design Systems, Inc.* 2,052,924
20,250 Microsoft Corp.* 1,825,031
64,405 Parametric Technology Co.* 2,058,947
44,225 Wind River Systems* 1,531,291
- --------------------------------------------------------------------------------
7,468,193
- --------------------------------------------------------------------------------
Computers - Micro - 3.0%
50,970 Dell Computer Corp.* $ 4,115,828
- --------------------------------------------------------------------------------
Containers - Paper and Plastic - 0.3%
6,800 Sealed Air Corp.* 427,550
- --------------------------------------------------------------------------------
Cruise Lines - 2.5%
20,150 Carnival Corp. - Class A 1,401,684
31,459 Royal Caribbean Cruises, Ltd. 2,151,009
- --------------------------------------------------------------------------------
3,552,693
- --------------------------------------------------------------------------------
Diversified Operations - 2.4%
60,070 CBS Corp.* 2,139,994
15,675 Roper Industries, Inc. 485,925
33,421 Siebe PLC 759,967
- --------------------------------------------------------------------------------
3,385,886
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 4.9%
94,490 Maxim Integrated Products, Inc.* 3,815,034
48,600 Texas Instruments, Inc. 3,113,438
- --------------------------------------------------------------------------------
6,928,472
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 1.2%
4,260 Beneficial Corp. 555,398
8,020 Household International, Inc. 1,054,129
- --------------------------------------------------------------------------------
1,609,527
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 4.0%
75,185 Charles Schwab Corp. 2,631,475
38,105 Morgan Stanley, Dean Witter, Discover and Co. 3,005,532
- --------------------------------------------------------------------------------
5,637,007
- --------------------------------------------------------------------------------
Finance - Other Services - 1.8%
47,785 HealthCare Financial Partners, Inc.* 2,407,169
1,740 Newcourt Credit Group, Inc. 85,478
- --------------------------------------------------------------------------------
2,492,647
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 13
<PAGE>
JANUS EQUITY INCOME FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Human Resources - 2.1%
31,637 Robert Half International, Inc.* $ 1,712,353
46,050 Romac International, Inc.* 1,220,325
- --------------------------------------------------------------------------------
2,932,678
- --------------------------------------------------------------------------------
Instruments - Scientific - 2.0%
52,775 Dionex Corp.* 2,816,866
- --------------------------------------------------------------------------------
Life and Health Insurance - 2.5%
4,116 Schweizerische Lebensversicherungs-und
Rentenanstalt 3,482,275
- --------------------------------------------------------------------------------
Medical - Drugs - 2.0%
8,515 Pfizer, Inc. 969,113
9,600 Warner-Lambert Co. 1,816,200
- --------------------------------------------------------------------------------
2,785,313
- --------------------------------------------------------------------------------
Money Center Banks - 6.5%
41,185 Bank of New York Co., Inc. 2,432,489
14,800 BankAmerica Corp. 1,258,000
45,292 Barclays PLC 1,307,069
106,954 Lloyds TSB Group PLC 1,604,973
1,572 UBS 2,532,069
- --------------------------------------------------------------------------------
9,134,600
- --------------------------------------------------------------------------------
Multimedia - 0.4%
14,275 Meredith Corp. 613,825
- --------------------------------------------------------------------------------
Music/Clubs - 0.8%
36,530 Steinway Musical Instruments, Inc.* 1,116,448
- --------------------------------------------------------------------------------
Networking Products - 2.1%
39,225 Cisco Systems, Inc.* 2,873,231
- --------------------------------------------------------------------------------
Radio - 2.3%
72,930 Heftel Broadcasting Corp. - Class A* 3,199,804
- --------------------------------------------------------------------------------
Retail - Discount - 1.7%
42,030 Costco Companies, Inc.* 2,348,426
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 0.9%
28,922 Fred Meyer, Inc.* 1,297,875
- --------------------------------------------------------------------------------
Schools - 0.6%
26,040 Apollo Group, Inc. - Class A* 891,870
- --------------------------------------------------------------------------------
Television - 2.7%
98,318 Univision Communications, Inc. - Class A* 3,766,808
- --------------------------------------------------------------------------------
Toys - 0.3%
12,425 Mattel, Inc. 476,033
- --------------------------------------------------------------------------------
Total Common Stock(cost $76,662,959) 95,658,568
- --------------------------------------------------------------------------------
Corporate Bonds - 7.4%
- --------------------------------------------------------------------------------
Cable Television - 0.8%
$1,150,000 Adelphia Communications Corp., 8.375%
senior notes, due 2/1/08 1,141,375
- --------------------------------------------------------------------------------
Circuits - 2.5%
1,850,000 Analog Devices, Inc., 3.50%
subordinated notes, due 12/1/00 3,505,750
- --------------------------------------------------------------------------------
Drug Delivery Systems - 2.0%
2,000,000 ALZA Corp., 5.00%
subordinated debentures, due 5/1/06 2,752,500
- --------------------------------------------------------------------------------
Radio - 1.3%
2,410,000 Jacor Communications, Inc., zero coupon senior
notes, due 6/12/11 1,864,738
- --------------------------------------------------------------------------------
Real Estate Development - 0.8%
1,000,000 Avatar Holdings, Inc., 7.00%
subordinated notes, due 4/1/05 1,095,000
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $9,871,975) 10,359,363
- --------------------------------------------------------------------------------
Preferred Stock - 19.1%
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 2.3%
45,000 Federal-Mogul Financial Trust, 7.00%+ $ 3,245,625
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 3.4%
26,098 TCI Pacific Communications, 5.00% 4,762,886
- --------------------------------------------------------------------------------
Cable Television - 4.9%
99,550 Houston Industries, Inc., 7.00% 6,906,281
- --------------------------------------------------------------------------------
Cruise Lines - 2.3%
28,645 Royal Caribbean Cruises, Ltd., 7.25% 3,147,369
- --------------------------------------------------------------------------------
Radio - 1.0%
14,500 Chancellor Media Corp., $3.00 1,417,375
- --------------------------------------------------------------------------------
Telephone - Local - 5.2%
98,157 US WEST Communications Group, 4.50% 7,312,697
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $22,888,386) 26,792,233
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 3.6%
Prudential Funding Corp.
$ 5,100,000 5.45%, 5/1/98 (amortized cost $5,100,000) 5,100,000
- --------------------------------------------------------------------------------
Total Investments (total cost $114,523,320) - 98.5% 137,910,164
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 1.5% 2,031,623
- --------------------------------------------------------------------------------
Net Assets - 100% $ 139,941,787
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Ireland 1.2% $ 1,654,922
Switzerland 4.3% 6,014,344
United Kingdom 2.7% 3,672,009
United States++ 91.8% 126,568,889
- --------------------------------------------------------------------------------
Total 100.0% $ 137,910,164
================================================================================
++Includes Short-Term Securities (88.1% excluding Short-Term Securities)
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 14
<PAGE>
JANUS GROWTH AND INCOME FUND Portfolio Manager, David J. Corkins
Your fund performed well in the first half of our fiscal year, November 1,
1997, to April 30, 1998. I made relatively few changes in the construction of
the Fund, which remains primarily focused in about 60 stocks. These stocks
caused the Fund to gain 19.66% during this period compared with the Standard and
Poor's 500 Index, which returned 22.50%. All returns include reinvested
dividends. The results placed your fund 20th out of 657, or in the top 3%, of
all growth and income funds in the Lipper Analytical Services category for the
12 months ended April 30, 1998.(1)
When the underlying fundamentals of the stocks in the Fund are strong and
getting stronger, I find my role as portfolio manager similar to that of the
famed Casey Stengel who claimed that, as manager of a baseball team, he "got
paid for home runs that other fellows hit." I would like to highlight several of
the "home run" holdings in your fund that performed well and continue to have
bright future economics. Many of these holdings illustrate what we look for in a
good investment: a top-flight management team focused on shareholder value, a
business that is not capital intensive, and favorable long-term economic
prospects.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 95.2% 92.4%
Foreign 5.8% 8.0%
European 5.8% 7.8%
Fixed-Income Securities 0.7% --
Top 10 Equities (% of Assets) 31.0% 33.9%
Number of Stocks 77 64
Cash & Cash Equivalents 4.1% 7.6%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Pfizer, Inc. 3.7% 3.3%
Time Warner, Inc. 3.5% 2.7%
Warner-Lambert Co. 3.4% 4.0%
CBS Corp. 3.4% --
Dell Computer Corp. 3.0% 3.0%
Comcast Corp. - Special Class A 2.9% --
Microsoft Corp. 2.9% 2.3%
BankAmerica Corp. 2.8% 1.6%
General Electric Co. 2.7% 2.6%
Cisco Systems, Inc. 2.7% 1.8%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Medical - Drugs 10.7% 10.3%
Diversified Operations 8.8% 6.4%
Cable Television 7.2% 1.1%
Computer Software 6.7% 4.8%
Multimedia 4.3% 2.7%
- --------------------------------------------------------------------------------
Leaders Identified by Strong Fundamentals
The combined strength of our technology, pharmaceutical, and financial
services holdings was the biggest reason for the Fund's strong gain this period.
Dell Computer, Cisco Systems, and Microsoft were significant technology
holdings, while Pfizer and Warner-Lambert captured the spotlight in the
pharmaceutical sector.
Michael Dell, the CEO of Dell Computer, was our favorite Babe Ruth home run
hitter for the period, producing a return of more than 100%. What made this an
attractive investment? Dell's "build-to-order" strategy allows it to use
negative working capital - it finances the day-to-day operations of the company
with other people's money. Thus, this simple computer manufacturer generates
100%+ returns on equity.
Cisco Systems, the dominant network equipment supplier, and Microsoft, the
powerhouse operating systems provider, also performed well, returning more than
35%. Both companies dominate their fast-growing niches and benefit from a
booming demand for Internet services and personal computers.
Pfizer, as our largest pharmaceutical holding, returned almost 60% during
the period. There are two main reasons I remain optimistic on Pfizer: Its
growing expertise as a marketer makes it the "partner of choice" for other drug
companies who need better distribution of blockbuster drugs, as well as its
focused research and development pipeline. Warner-Lambert's Lipitor, a
cholesterol-reducing drug, had the most successful drug launch in history by
leveraging the strength of Pfizer's market-leading sales force.
Financial Stocks Ride Consolidation Wave
Both BankAmerica and Citicorp, two significant bank holdings, outperformed
the market because of continued consolidation in the financial services
industry. Citicorp is merging with Travelers Group in a $76 billion deal,
creating the world's largest financial services company. BankAmerica followed
suit a week later with news of its union with NationsBank to create the largest
bank in the United States.
I don't characterize banking as a great business; it is essentially a
commodity, because your money is the same as mine. Banks have also been lemmings
in their compulsive need to play follow-the-leader and exacerbate credit quality
cycles. However, I am optimistic about the consolidation in the financial
services industry. The mergers and stock buybacks, which are so prevalent,
remove excess capital, and the new corporations are more diverse geographically
with a stronger business mix and balance sheet. We are only in the third inning
of the consolidation game - there are still 11,000 banks and thrifts in the
United States.
Notable Performance of Foreign Holdings
Although we had a limited number of foreign stocks in the Fund this period,
the majority of those outperformed. Porsche, the German sports car manufacturer,
appreciated 80% because of cheaper production methods and strong demand for new
models. BCI, an Italian bank, almost doubled as it restructured its operations
and gained share in the fast-growing mutual fund business.
We had few stocks that significantly underperformed. I reduced several oil
services positions during the fourth quarter before the dramatic decline in oil
prices and eventually eliminated these positions entirely. I also trimmed our
position in Eli Lilly because of a slow launch of its new osteoporosis drug.
More important than market predictions is my confidence that no matter what
direction the markets move, the underlying fundamentals of the companies in our
Fund should remain solid. This is a result of the intensive research the entire
Janus portfolio management team conducts to help uncover these great companies
in the first place.
Thank you for your continued investment in Janus Growth and Income Fund.
- --------------------------------------------------------------------------------
(1) Lipper Analytical Services, Inc. defines a growth and income fund as one
that "combines a growth of earnings orientation and an income requirement
for level and/or rising dividends." As of April 30, 1998, Janus Growth and
Income Fund ranked 4/431 of growth and income funds for the 3-year period
and 13/260 for the 5-year period. The ranking is based on total return,
including reinvestment of dividends and capital gains for the stated
period.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 15
<PAGE>
JANUS GROWTH AND INCOME FUND Portfolio Manager, David J. Corkins
Performance Overview
GRAPHIC
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 blue 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, May 15, 1991, through
April 30, 1998. The upper right quadrant reflects the ending value of the
hypothetical investment in Janus Growth and Income Fund ($39,776) as compared to
the S&P 500 Index ($35,948). There is a legend in the upper left quadrant of the
graph which indicates Janus Growth and Income Fund's one-year, five-year and
since inception (May 15, 1991) average annual total returns as 47.82%, 23.10%
and 21.95%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS GROWTH AND INCOME FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 92.0%
- --------------------------------------------------------------------------------
Advertising Sales - 1.1%
900,001 Outdoor Systems, Inc.* $ 28,575,032
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 1.4%
725,000 Monsanto Co. 38,334,375
- --------------------------------------------------------------------------------
Agricultural Operations - 2.1%
1,224,961 Delta and Pine Land Co. 56,424,766
- --------------------------------------------------------------------------------
Airlines - 1.0%
310,000 UAL Corp.* 27,028,125
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 1.5%
525,000 Ford Motor Co. 24,051,562
325,000 Renault S.A.*,** 15,067,891
- --------------------------------------------------------------------------------
39,119,453
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 0.7%
300,000 Federal-Mogul Corp. 19,406,250
- --------------------------------------------------------------------------------
Beverages - Non-Alcoholic - 2.6%
1,880,000 Coca-Cola Enterprises, Inc. 70,970,000
- --------------------------------------------------------------------------------
Cable Television - 7.2%
2,150,000 Comcast Corp. - Special Class A 76,996,875
397,315 Cox Communications, Inc. - Class A* 17,730,182
1,725,000 Tele-Communications, Inc. - Class A* 55,631,250
1,146,410 US WEST Media Group* 43,276,977
- --------------------------------------------------------------------------------
193,635,284
- --------------------------------------------------------------------------------
Cellular Telecommunications - 0.6%
2,000,000 Telecom Italia S.p.A.** 15,062,500
- --------------------------------------------------------------------------------
Chemicals - Diversified - 3.0%
375,000 E.I. du Pont de Nemours and Co. 27,304,687
270,000 Imperial Chemical Industries PLC (ADR) 19,625,625
1,200,000 Solutia, Inc. 34,050,000
- --------------------------------------------------------------------------------
80,980,312
- --------------------------------------------------------------------------------
Chemicals - Specialty - 1.3%
650,000 Cytec Industries, Inc.* $ 35,587,500
- --------------------------------------------------------------------------------
Circuits - 0.7%
450,000 Analog Devices, Inc.* 17,521,875
- --------------------------------------------------------------------------------
Commercial Banks - 1.4%
585,000 Star Banc Corp. 36,964,688
- --------------------------------------------------------------------------------
Computer Software - 6.7%
1,225,565 Cadence Design Systems, Inc.* 44,503,329
850,000 Microsoft Corp.* 76,606,250
1,161,280 Parametric Technology Co.* 37,124,670
610,000 Wind River Systems* 21,121,250
- --------------------------------------------------------------------------------
179,355,499
- --------------------------------------------------------------------------------
Computers - Micro - 3.0%
1,000,000 Dell Computer Corp.* 80,750,000
- --------------------------------------------------------------------------------
Containers - Paper and Plastic - 1.1%
450,140 Sealed Air Corp.* 28,302,552
- --------------------------------------------------------------------------------
Cruise Lines - 1.3%
500,000 Royal Caribbean Cruises, Ltd. 34,187,500
- --------------------------------------------------------------------------------
Diversified Financial Services - 1.3%
345,000 Associates First Capital Corp. - Class A 25,788,750
358,125 Heller Financial, Inc.* 9,669,375
- --------------------------------------------------------------------------------
35,458,125
- --------------------------------------------------------------------------------
Diversified Operations - 8.8%
2,525,000 CBS Corp.* 89,953,125
860,000 General Electric Co. 73,207,500
500,000 Textron, Inc. 39,125,000
600,000 Tyco International, Ltd. 32,700,000
- --------------------------------------------------------------------------------
234,985,625
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 16
<PAGE>
JANUS GROWTH AND INCOME FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 3.6%
500,000 Applied Materials, Inc.* $ 18,062,500
200,000 Intel Corp. 16,162,500
600,000 Maxim Integrated Products, Inc.* 24,225,000
600,000 Texas Instruments, Inc. 38,437,500
- --------------------------------------------------------------------------------
96,887,500
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 1.7%
40,000 Beneficial Corp. 5,215,000
300,000 Household International, Inc. 39,431,250
- --------------------------------------------------------------------------------
44,646,250
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 1.8%
300,000 Charles Schwab Corp. 10,500,000
130,000 Merrill Lynch & Co., Inc. 11,407,500
320,000 Morgan Stanley, Dean Witter, Discover and Co. 25,240,000
- --------------------------------------------------------------------------------
47,147,500
- --------------------------------------------------------------------------------
Finance - Mortgage Loan Banker - 1.0%
460,210 Fannie Mae 27,555,074
- --------------------------------------------------------------------------------
Finance - Other Services - 1.5%
797,870 Newcourt Credit Group, Inc. 39,195,364
- --------------------------------------------------------------------------------
Food - Diversified - 0.4%
250,075 Nabisco Holdings Corp. - Class A 11,956,711
- --------------------------------------------------------------------------------
Medical - Drugs - 10.7%
125,000 American Home Products Corp. 11,640,625
1,055,000 Astra A.B. - Class A** 21,675,799
350,000 Bristol-Myers Squibb Co. 37,056,250
200,000 Eli Lilly and Co. 13,912,500
860,000 Pfizer, Inc. 97,878,750
1,136,837 SmithKline Beecham PLC** 13,440,687
480,000 Warner-Lambert Co. 90,810,000
- --------------------------------------------------------------------------------
286,414,611
- --------------------------------------------------------------------------------
Money Center Banks - 4.2%
51,102 Banca Commerciale Italiana** 258,439
875,795 BankAmerica Corp. 74,442,575
250,000 Citicorp 37,625,000
- --------------------------------------------------------------------------------
112,326,014
- --------------------------------------------------------------------------------
Multi-Line Insurance - 0.8%
423,951 Assicurazioni Generali** 12,693,526
43,355 ERGO Versicherungs Gruppe A.G.** 8,214,391
- --------------------------------------------------------------------------------
20,907,917
- --------------------------------------------------------------------------------
Multimedia - 4.3%
1,175,000 Time Warner, Inc. 92,237,500
175,000 Walt Disney Co. (The) 21,754,687
- --------------------------------------------------------------------------------
113,992,187
- --------------------------------------------------------------------------------
Networking Products - 2.7%
985,000 Cisco Systems, Inc.* 72,151,250
- --------------------------------------------------------------------------------
Pharmacy Services - 0.7%
524,992 Omnicare, Inc. 17,980,976
- --------------------------------------------------------------------------------
Publishing - Periodicals - 0.4%
584,725 Ziff-Davis, Inc.* 10,525,050
- --------------------------------------------------------------------------------
Radio - 1.9%
660,795 Chancellor Media Corp.* 31,346,463
448,840 Heftel Broadcasting Corp. - Class A* 19,692,855
- --------------------------------------------------------------------------------
51,039,318
- --------------------------------------------------------------------------------
Retail - Discount - 0.9%
416,100 Costco Companies, Inc.* 23,249,587
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 1.0%
600,000 Fred Meyer, Inc.* 26,925,000
- --------------------------------------------------------------------------------
Super-Regional Banks - 3.6%
150,000 Fleet Financial Group, Inc. $ 12,956,250
100,000 Mellon Bank Corp. 7,200,000
480,000 U.S. Bancorp 60,960,000
40,000 Wells Fargo & Co. 14,740,000
- --------------------------------------------------------------------------------
95,856,250
- --------------------------------------------------------------------------------
Telecommunication Equipment - 0.6%
230,000 Lucent Technologies, Inc. 17,508,750
- --------------------------------------------------------------------------------
Telecommunication Services - 1.3%
650,000 Teleport Communications Group, Inc. - Class A* 35,018,750
- --------------------------------------------------------------------------------
Telephone - Long Distance - 1.8%
1,100,000 WorldCom, Inc.* 47,059,375
- --------------------------------------------------------------------------------
Toys - 0.3%
200,000 Mattel, Inc. 7,662,500
- --------------------------------------------------------------------------------
Total Common Stock (cost $1,831,666,292) 2,458,655,395
- --------------------------------------------------------------------------------
Corporate Bonds - 0.7%
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 0.4%
$10,000,000 Fred Meyer, Inc., 7.45%
senior notes, due 3/1/08 9,975,000
- --------------------------------------------------------------------------------
Telecommunication Services - 0.3%
10,000,000 Level 3 Communications, Inc., 9.125% senior
notes, due 5/1/08 9,900,000
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $19,943,517) 19,875,000
- --------------------------------------------------------------------------------
Preferred Stock - 3.2%
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 1.8%
19,063 Porsche A.G.** 47,697,416
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.6%
91,560 TCI Pacific Communications, 5.00% 16,709,700
- --------------------------------------------------------------------------------
Electric - Integrated - 0.4%
175,000 Houston Industries, Inc., 7.00% 12,140,625
- --------------------------------------------------------------------------------
Radio - 0.4%
103,082 Chancellor Media Corp., $3.00 10,076,266
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $66,568,703) 86,624,007
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 2.6%
Prudential Funding Corp.
$ 68,600,000 5.45%, 5/1/98 (amortized cost $68,600,000) 68,600,000
- --------------------------------------------------------------------------------
U.S. Government Agencies - 2.8%
Fannie Mae:
25,000,000 5.39%, 5/6/98 24,981,285
50,000,000 5.75%, 7/22/98 49,386,000
- --------------------------------------------------------------------------------
Total U.S. Government Agencies (cost $74,370,840) 74,367,285
- --------------------------------------------------------------------------------
Total Investments (total cost $2,061,149,352) - 101.3% 2,708,121,687
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (1.3%) (35,700,274)
- --------------------------------------------------------------------------------
Net Assets - 100% $2,672,421,413
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 17
<PAGE>
JANUS GROWTH AND INCOME FUND April 30, 1998 (unaudited)
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
France 0.6% $ 15,067,891
Germany 2.1% 55,911,809
Italy 1.0% 28,014,464
Sweden 0.8% 21,675,799
United Kingdom 1.2% 33,066,311
United States++ 94.3% 2,554,385,413
- --------------------------------------------------------------------------------
Total 100.0% $2,708,121,687
================================================================================
++Includes Short-Term Securities (89.0% excluding Short-Term Securities)
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 10/7/98 7,600,000 $ 12,615,240 ($12,390)
German Deutschemark 7/2/98 57,300,000 32,025,486 (665,226)
German Deutschemark 7/23/98 36,700,000 20,536,064 (125,501)
French Franc 7/31/98 81,000,000 13,524,118 (12,859)
Italian Lira 7/17/98 34,800,000,000 19,678,071 (246,114)
Italian Lira 11/12/98 11,600,000,000 6,588,655 (19,022)
Swedish Krona 8/7/98 141,000,000 18,273,244 (487,324)
- --------------------------------------------------------------------------------
Total $ 123,240,878 ($1,568,436)
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 18
<PAGE>
JANUS MERCURY FUND Portfolio Manager, Warren B. Lammert
Janus Mercury Fund finished the six-month period ended April 30, 1998, with
a gain of 22.29% versus the S&P 500 Index, which climbed 22.50%. Both returns
include reinvested dividends.
While I was disappointed in Janus Mercury Fund's fourth-quarter
performance, much stronger returns materialized early in '98. The Fund regained
lost ground from a selloff in the technology and oil services industries, which
was caused by Asia's economic reversal late in the year. Also helping revitalize
performance were healthy returns posted by our pharmaceutical and cable
holdings.
Despite the underperformance of Janus Mercury Fund in '97, many of the same
investment ideas we had then are working now, proving a disciplined investment
approach can deliver results over time. Perhaps the only strategic change in the
Fund this period was my reduction in the number of its holdings from 100 to 70.
This has enabled our investment team to pay even greater attention to individual
company fundamentals.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 97.3% 97.4%
Foreign 10.0% 23.6%
European 10.0% 23.0%
Top 10 Equities (% of Assets) 40.9% 34.2%
Number of Stocks 70 100
Cash & Cash Equivalents 2.7% 2.6%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Warner-Lambert Co. 5.9% 5.8%
Parametric Technology Co. 4.9% 4.7%
Time Warner, Inc. 4.7% 1.0%
Microsoft Corp. 4.0% 1.6%
Tele-Communications, Inc. 3.9% 0.9%
Comcast Corp. - Special Class A 3.8% --
America Online, Inc. 3.7% --
Monsanto Co. 3.7% 4.2%
Analog Devices, Inc. 3.4% 1.7%
Nokia Oyj (ADR) - Class A 2.9% 1.4%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Computer Software 12.9% 9.0%
Cable Television 10.2% 0.9%
Medical - Drugs 8.6% 6.6%
Multimedia 4.7% 1.0%
Agricultural Biotechnology 4.6% --
- --------------------------------------------------------------------------------
Healthy Economies Support Strong Markets
Domestic equity markets thrived as a combined result of low interest rates,
virtually nonexistent inflation, and a reassessment of the Asian downturn. The
events in Asia actually strengthened the U.S. economy by holding down prices,
which in turn has improved the interest rate environment. European markets also
gained significantly as the movement toward European Monetary Union appears to
be bringing lower interest rates to many historically fragile economies.
Despite a resurgence in the technology sector, which is the largest broad
sector holding in the Fund, it was critical to hold the right technology stocks
this period. Earnings reports helped investors differentiate between companies
with weak product demand and possible overexposure to Asia and those with solid
long-term growth potential and strong business dividends such as Microsoft and
Dell Computer.
Pharmaceuticals, which make up almost 10% of the Fund, attracted increased
attention as investors sought clear earnings visibility to hedge against a
possible global economic slowdown. Several of our holdings in the pharmaceutical
and life sciences industries that posted particularly strong returns were
Warner-Lambert, Pfizer, and Monsanto. All demonstrated strong business
fundamentals, including the development of several new blockbuster products.
Lipitor, developed by Warner-Lambert and co-marketed with Pfizer, jumped
from a January '97 launch to capture the leading share of the
cholesterol-lowering market and a $1.5 billion annual sales level by April of
'98. Pfizer's Viagra saw a record launch in April of '98 as the first effective
and convenient therapy for male erectile dysfunction. And progressing toward a
July '98 Food and Drug Administration filing is Celebra, a nonsteroidal
anti-inflammatory drug developed by Monsanto and also co-marketed with Pfizer.
Celebra promises to match the efficacy of other widely prescribed therapies for
pain and arthritis, without the serious gastro-intestinal side effects normally
associated with those therapies.
During the period, I also increased our positions in a variety of cable
stocks, including Tele-Communications, Inc. (TCI), Time Warner, and Comcast. I
see an exciting future for this group as a major upgrade of the cable
infrastructure nears completion, helping to provide increased capacity, and,
more important, digital service capability.
With the completion of this upgrade, capital spending needs will decline
significantly for the cable industry. At the same time, these companies will
enjoy major new revenue opportunities from expanded video, television, and movie
offerings, and telephone and data services. As a result, early in the next
century we should see a huge generation of free cash flow. This will require a
new approach to valuation for these companies, which should be extremely
beneficial to share prices.
As I mentioned earlier, a fourth-quarter selloff in oil services hurt our
holdings in this sector. The turn of events that led to declining oil prices
included reduced demand from Asia, increased supply from Saudi Arabia, and the
warmest winter on record.
We entered into this position on the thesis that a recent boom in oil
services demand was technology-driven, not commodity-driven. I was particularly
optimistic about long-term prospects for Schlumberger Ltd., a company that
improved oil exploration and extraction through new technology. However, the
collapse in oil prices forced us to trim our exposure to this industry.
Looking Ahead
The financial markets continue to thrive in the current near-perfect blend
of low yields, benign inflation, and robust economic growth. However, the
markets have discounted this good news, and U.S. stocks are trading at
historically high multiples. Unfortunately, continued good news, especially with
respect to inflation, will be required for the markets to maintain today's
euphoric overtones. On the positive side, I remain enthusiastic about our
current holdings. I believe our companies are marked by their dynamic earnings
and growth potential, strong market positions, and powerful franchises.
We appreciate your continued investment in Janus Mercury Fund.
- --------------------------------------------------------------------------------
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 19
<PAGE>
JANUS MERCURY FUND Portfolio Manager, Warren B. Lammert
Performance Overview
GRAPHIC
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 blue 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, May 3, 1993, through April 30, 1998. The
upper right quadrant reflects the ending value of the hypothetical investment in
Janus Mercury Fund ($29,988) as compared to the S&P 500 Index ($28,265). 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 44.07% and 24.56%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS MERCURY FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 97.3%
- --------------------------------------------------------------------------------
Advertising Sales - 1.4%
456,641 Lamar Advertising Co. - Class A* $ 15,754,115
492,563 Outdoor Systems, Inc.* 15,638,875
- --------------------------------------------------------------------------------
31,392,990
- --------------------------------------------------------------------------------
Aerospace and Defense - 0.5%
235,040 Orbital Sciences Corp.* 10,459,280
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 4.6%
292,860 DEKALB Genetics Corp. - Class B 19,969,391
1,551,155 Monsanto Co. 82,017,321
- --------------------------------------------------------------------------------
101,986,712
- --------------------------------------------------------------------------------
Agricultural Operations - 0.9%
438,265 Delta and Pine Land Co. 20,187,582
- --------------------------------------------------------------------------------
Applications Software - 2.8%
447,930 Intuit, Inc.* 23,824,277
519,585 PeopleSoft, Inc.* 24,160,703
285,740 Sapient Corp.* 14,108,412
- --------------------------------------------------------------------------------
62,093,392
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 1.3%
439,590 Federal-Mogul Corp. 28,435,978
- --------------------------------------------------------------------------------
Cable Television - 10.2%
2,351,700 Comcast Corp. - Special Class A 84,220,256
83,765 Cox Communications, Inc. - Class A* 3,738,013
2,630,362 Tele-Communications, Inc. - Class A* 84,829,175
1,342,810 US WEST Media Group* 50,691,078
- --------------------------------------------------------------------------------
223,478,522
- --------------------------------------------------------------------------------
Cellular Telecommunications - 1.8%
2,851,216 Telecom Italia S.p.A.** 21,473,220
900,150 Western Wireless Corp. - Class A* 17,552,925
- --------------------------------------------------------------------------------
39,026,145
- --------------------------------------------------------------------------------
Chemicals - Diversified - 0.7%
512,160 Solutia, Inc. $ 14,532,540
- --------------------------------------------------------------------------------
Chemicals - Specialty - 0.3%
163,920 Cabot Corp. 5,890,875
- --------------------------------------------------------------------------------
Circuits - 3.4%
1,890,337 Analog Devices, Inc.* 73,604,997
- --------------------------------------------------------------------------------
Commercial Banks - 0.7%
236,020 Star Banc Corp. 14,913,514
- --------------------------------------------------------------------------------
Computer Software - 12.9%
54,945 Aspect Development, Inc.* 3,478,705
862,355 Aspen Technology, Inc.* 42,147,601
806,045 Cadence Design Systems, Inc.* 29,269,509
985,250 Microsoft Corp.* 88,795,656
3,366,730 Parametric Technology Co.* 107,630,150
371,842 Wind River Systems* 12,875,029
- --------------------------------------------------------------------------------
284,196,650
- --------------------------------------------------------------------------------
Computers - Memory Devices - 0.4%
172,315 VERITAS Software Corp.* 9,434,246
- --------------------------------------------------------------------------------
Computers - Micro - 1.1%
309,535 Dell Computer Corp.* 24,994,951
- --------------------------------------------------------------------------------
Containers - Paper and Plastic - 1.0%
332,230 Sealed Air Corp.* 20,888,961
- --------------------------------------------------------------------------------
Diversified Financial Services - 1.5%
435,220 Associates First Capital Corp. - Class A 32,532,695
- --------------------------------------------------------------------------------
Diversified Operations - 4.2%
1,008,360 CBS Corp.* 35,922,825
312,056 Metra Oy - Class B** 7,847,099
1,022,513 Siebe PLC** 23,251,128
456,305 Tyco International, Ltd. 24,868,623
- --------------------------------------------------------------------------------
91,889,675
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 20
<PAGE>
JANUS MERCURY FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Drug Delivery Systems - 1.4%
637,450 ALZA Corp.* $ 30,557,759
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 2.4%
352,195 Applied Materials, Inc.* 12,723,044
242,915 ASM Lithography Holding N.V. (ADR)* 22,257,087
434,465 Maxim Integrated Products, Inc.* 17,541,524
- --------------------------------------------------------------------------------
52,521,655
- --------------------------------------------------------------------------------
Electronic Safety Devices - 2.2%
645,200 Pittway Corp. - Class A 48,228,700
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 0.9%
152,805 Household International, Inc. 20,084,307
- --------------------------------------------------------------------------------
Food - Diversified - 2.3%
277,096 Raisio Group PLC** 50,861,165
- --------------------------------------------------------------------------------
Internet Content - 0.7%
425,500 At Home Corp. - Class A* 14,174,469
- --------------------------------------------------------------------------------
Internet Software - 3.7%
1,029,044 America Online, Inc.* 82,323,520
- --------------------------------------------------------------------------------
Life and Health Insurance - 2.2%
901,351 UNUM Corp. 48,447,616
- --------------------------------------------------------------------------------
Medical - Drugs - 8.6%
317,920 Eli Lilly and Co. 22,115,310
325,345 Pfizer, Inc. 37,028,328
686,230 Warner-Lambert Co. 129,826,138
- --------------------------------------------------------------------------------
188,969,776
- --------------------------------------------------------------------------------
Medical Information Systems - 1.3%
462,525 HBO & Co. 27,664,777
- --------------------------------------------------------------------------------
Medical Instruments - 1.4%
341,445 Sofamor Danek Group, Inc.* 29,961,799
- --------------------------------------------------------------------------------
Money Center Banks - 2.1%
770,790 Banca Commerciale Italiana** 3,897,993
350,340 Bank of New York Co., Inc. 20,691,956
257,175 BankAmerica Corp. 21,859,875
- --------------------------------------------------------------------------------
46,449,824
- --------------------------------------------------------------------------------
Multimedia - 4.7%
1,317,405 Time Warner, Inc. 103,416,293
- --------------------------------------------------------------------------------
Networking Products - 2.7%
806,227 Cisco Systems, Inc.* 59,056,128
- --------------------------------------------------------------------------------
Oil - Field Services - 1.2%
21,304,941 Ocean Rig ASA*,# 20,710,551
223,613 Smedvig ASA - Class B 4,497,401
- --------------------------------------------------------------------------------
25,207,952
- --------------------------------------------------------------------------------
Pharmacy Services - 1.3%
820,481 Omnicare, Inc. 28,101,474
- --------------------------------------------------------------------------------
Radio - 1.1%
529,935 Chancellor Media Corp.* 25,138,792
- --------------------------------------------------------------------------------
Retail - Building Products - 0.7%
267,685 Fastenal Co. 14,973,630
- --------------------------------------------------------------------------------
Retail - Discount - 1.0%
403,420 Costco Companies, Inc.* 22,541,092
- --------------------------------------------------------------------------------
Retail - Internet - 1.0%
230,790 Amazon.com, Inc.* 21,174,982
- --------------------------------------------------------------------------------
Savings/Loan/Thrifts - 0.4%
102,515 Ambanc Holding Co., Inc. 1,819,641
155,860 First Defiance Financial Corp. 2,337,900
62,765 North Central Bancshares, Inc. 1,514,206
86,825 Provident Financial Holdings, Inc.* 2,040,387
76,875 TF Financial Corp. 2,114,062
- --------------------------------------------------------------------------------
9,826,196
- --------------------------------------------------------------------------------
Super-Regional Banks - 1.0%
178,550 U.S. Bancorp $ 22,675,850
- --------------------------------------------------------------------------------
Telecommunication Equipment - 2.9%
967,010 Nokia Oyj (ADR) - Class A 64,668,794
- --------------------------------------------------------------------------------
Television - 0%
58,675 United International Holdings, Inc. - Class A* 997,475
- --------------------------------------------------------------------------------
Vitamins and Nutrition Products - 0.4%
230,630 Twinlab Corp.* 9,052,227
- --------------------------------------------------------------------------------
Total Common Stock (cost $1,593,177,335) 2,137,015,957
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 1.8%
Prudential Funding Corp.
$ 40,500,000 5.45%, 5/1/98 (amortized cost $40,500,000) 40,500,000
- --------------------------------------------------------------------------------
Total Investments (total cost $1,633,677,335) - 99.1% 2,177,515,957
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 0.9% 19,772,839
- --------------------------------------------------------------------------------
Net Assets - 100% $ 2,197,288,796
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Finland 5.7% $ 123,377,058
Italy 1.2% 25,371,212
Netherlands 1.0% 22,257,087
Norway 1.1% 25,207,952
United Kingdom 1.1% 23,251,127
United States++ 89.9% 1,958,051,521
- --------------------------------------------------------------------------------
Total 100.0% $2,177,515,957
================================================================================
++Includes Short-Term Securities (88.1% excluding Short-Term Securities)
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 5/11/98 3,048,000 $ 5,093,818 ($153,418)
British Pound 8/7/98 400,000 665,680 (3,040)
British Pound 10/7/98 2,052,000 3,406,115 (3,899)
Dutch Guilder 7/2/98 11,800,000 5,858,987 (108,500)
Dutch Guilder 7/17/98 4,200,000 2,087,164 (24,296)
Dutch Guilder 7/31/98 6,000,000 2,984,036 (20,487)
Finnish Markka 5/28/98 9,751,000 1,792,397 72,039
Finnish Markka 7/10/98 300,000 55,278 (633)
Finnish Markka 7/17/98 62,892,000 11,592,996 (220,120)
Finnish Markka 7/23/98 2,057,000 379,296 (858)
Finnish Markka 7/31/98 242,000,000 44,642,857 (499,214)
Finnish Markka 8/7/98 20,000,000 3,690,922 (87,773)
Italian Lira 8/7/98 19,150,000,000 10,835,462 (216,531)
Italian Lira 11/12/98 18,850,000,000 10,706,564 (30,911)
- --------------------------------------------------------------------------------
Total $ 103,791,572 ($1,297,641)
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 21
<PAGE>
JANUS OLYMPUS FUND Portfolio Manager, Claire Young
Janus Olympus Fund gained 19.35% during the first half of our fiscal year,
November 1, 1997, to April 30, 1998. The S&P 500 Index gained 22.50% for the
same period. Both returns include reinvested dividends.
For the 12 months ended April 30, 1998, the Fund ranked 45th out of 230
capital appreciation funds as tracked by Lipper Analytical Services, Inc., a
leading mutual fund rating company.(1)
During the half, the market showed remarkable resilience from the October
downdraft as investors used the opportunity to increase their exposure to
equities. Amid the Asian turmoil, investors focused their buying activity on
companies with predictable earnings streams. Companies with exposure to Asian
economies or with less certain earnings streams did not experience as vigorous a
rebound.
The majority of the Fund benefited tremendously from the market's "flight
to quality"; however, in November, our oil services stocks underperformed. Oil
prices saw a quick downturn as Asian demand slowed, while OPEC supplies
continued to grow. As I cut exposure to this area, performance improved
significantly.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 96.1% 93.8%
Foreign 9.5% 14.7%
European 9.5% 12.9%
Top 10 Equities (% of Assets) 35.9% 40.7%
Number of Stocks 60 57
Cash & Cash Equivalents 3.9% 6.2%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Warner-Lambert Co. 6.1% 5.1%
Microsoft Corp. 4.7% 5.1%
Pfizer, Inc. 4.5% 5.6%
Cisco Systems, Inc. 3.9% 0.4%
Cadence Design Systems, Inc. 3.5% 1.6%
Dell Computer Corp. 3.1% 4.7%
America Online, Inc. 3.0% 1.4%
Time Warner, Inc. 2.5% 1.0%
CBS Corp. 2.3% --
Monsanto Co. 2.3% 2.6%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Medical - Drugs 13.6% 20.6%
Computer Software 10.9% 8.7%
Money Center Banks 4.1% 6.3%
Networking Products 3.9% 0.4%
Finance - Investment
Bankers/Brokers 3.7% 2.8%
- --------------------------------------------------------------------------------
Technology and Drug Stocks Post Strong Results
Technology continued to be a main driver of domestic economic growth, from
improving worker productivity to harnessing data to run businesses more
efficiently. The robust demand of the sub-$1,000 personal computer-dominated
technology issues. Driven by consumers' desire to access the Internet, unit
volume growth of these low-end personal computers was surprisingly strong. Many
of our technology holdings performed well despite the drop in computer prices.
Indeed, some of our newer holdings are positioned to benefit from the exploding
interest in Internet-related offerings. Microsoft operating systems and software
packages grew with the increased unit growth of PCs, with no pricing pressures.
Dell Computer's superior direct marketing model enabled the company to take
advantage of pricing turmoil in the market. Dell maintained very little
inventory, which allowed the company to upgrade its product offerings at
compelling prices, while its competitors suffered through inventory destocking
of higher-priced, older computer components.
I added to positions in Cisco Systems and America Online (AOL). Cisco is
the market leader in computer networking technology and provides key
infrastructure equipment to support the rapid growth of Internet/intranet
traffic. AOL is the leading Internet and online service provider. It is enjoying
tremendous subscriber growth and capitalizing on the increasing advertising and
marketing dollars being spent in this new medium.
In the pharmaceutical area, the aggressive spending in research and
development and the increasing use of technology to better target research
continue to generate drugs with better efficacy and lower side effects. Our drug
companies' strong product sales demonstrate the benefits of their previous
investment in research. Warner-Lambert's Lipitor overtook Merck's Zocor as the
leading cholesterol-lowering drug and continues to surpass estimates on sales.
Pfizer's Viagra, a male impotence drug, was finally approved for marketing. Upon
its release, it became the fastest-growing prescription drug ever. Pfizer signed
a licensing agreement with Monsanto for Celebra, a nonsteroid anti-inflammatory
with fewer gastrointestinal side effects than other painkillers. This
revolutionary compound will be marketed next year and should continue the recent
string of blockbuster drug introductions.
Looking for Attractive Characteristics
Some of our lower-profile stocks also produced outstanding returns in the
first half. While seemingly disparate in nature, each has the characteristics
that I'm looking for in investments: growth industries, dominant product
offerings, and excellent management teams. Royal Caribbean Cruises is one of the
leading companies in the cruise industry - an industry experiencing increased
acceptance as a vacation alternative with high barriers to entry. The company is
benefiting from strong pricing and its focus on improving ship profitability.
Select Appointments is a global temporary employment agency with an emphasis on
information technology employees. It's well-positioned to capture the growth of
technology spending in Europe, particularly to address Year 2000 and European
Monetary Unit issues.
I sold our position in Ciena, a telecommunications equipment provider, when
purchases from one of its largest customers were delayed. As mentioned earlier,
I also sold our positions in the oil services equipment and deep-water drilling
segments because of concerns of languishing oil prices. Finally, I sold JBA
Holdings, an U.K. software firm, when it failed to meet our earnings
expectations.
Current Outlook
As the first half ended, companies were reporting solid first-quarter
earnings. Despite some pockets of weakness, the U.S. and European economies
demonstrated solid growth that more than offset Asia's slowdown for many of our
holdings. I believe we will continue to see volatility in the market as the
impact of Asia's turmoil continues to unfold. However, I feel confident in our
companies' growth prospects and ability to generate strong returns.
Thank you for your investment in Janus Olympus Fund.
- --------------------------------------------------------------------------------
(1) A capital appreciation fund is defined by Lipper as one that "aims at
maximum capital appreciation, frequently by means of 100% or more portfolio
turnover, leveraging, purchasing unregistered securities, purchasing
options, etc. The fund may take large cash positions." Lipper's ranking is
based on total return, including reinvestment of dividends and capital
gains for the stated period.
Past performance does not guarantee future results.
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 22
<PAGE>
JANUS OLYMPUS FUND Portfolio Manager, Claire Young
Performance Overview
GRAPHIC
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Olympus Fund and the S&P 500 Index. Janus Olympus Fund is represented
by a solid blue 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, December 29, 1995, through April 30,
1998. The upper right quadrant reflects the ending value of the hypothetical
investment in Janus Olympus Fund ($18,471) as compared to the S&P 500 Index
($18,871). There is a legend in the upper left quadrant of the graph which
indicates Janus Olympus Fund's one-year and since inception (December 29, 1995)
average annual total returns as 46.87% and 30.08%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS OLYMPUS FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 94.5%
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 2.3%
345,525 Monsanto Co. $ 18,269,634
- --------------------------------------------------------------------------------
Applications Software - 3.6%
336,570 Intuit, Inc.* 17,901,317
230,000 PeopleSoft, Inc.* 10,695,000
- --------------------------------------------------------------------------------
28,596,317
- --------------------------------------------------------------------------------
Cable Television - 3.6%
450,000 Comcast Corp. - Special Class A 16,115,625
400,000 Tele-Communications, Inc. - Class A* 12,900,000
- --------------------------------------------------------------------------------
29,015,625
- --------------------------------------------------------------------------------
Cellular Telecommunications - 1.1%
200,000 Cellular Communications International, Inc.* 8,800,000
- --------------------------------------------------------------------------------
Circuits - 1.5%
150,050 Linear Technology Corp. 12,079,025
- --------------------------------------------------------------------------------
Commercial Banks - 0.9%
85,000 Credit Commercial de France** 6,779,928
- --------------------------------------------------------------------------------
Computer Software - 10.9%
125,000 BMC Software, Inc.* 11,695,313
768,410 Cadence Design Systems, Inc.* 27,902,888
415,000 Microsoft Corp.* 37,401,875
93,005 Mobius Management Systems, Inc.* 1,720,593
250,000 Wind River Systems* 8,656,250
- --------------------------------------------------------------------------------
87,376,919
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 1.2%
130,000 Aspec Technology, Inc.* 1,803,750
150,000 Saville Systems Ireland PLC (ADR)* 7,481,250
- --------------------------------------------------------------------------------
9,285,000
- --------------------------------------------------------------------------------
Computers - Memory Devices - 3.3%
225,000 EMC Corp.* $ 10,378,125
298,175 VERITAS Software Corp.* 16,325,081
- --------------------------------------------------------------------------------
26,703,206
- --------------------------------------------------------------------------------
Computers - Micro - 3.1%
310,000 Dell Computer Corp.* 25,032,500
- --------------------------------------------------------------------------------
Cruise Lines - 2.2%
251,860 Royal Caribbean Cruises, Ltd. 17,220,927
- --------------------------------------------------------------------------------
Data Processing and Management - 2.7%
261,840 CSG Systems International, Inc.* 11,913,720
149,050 i2 Technologies, Inc.* 9,949,087
- --------------------------------------------------------------------------------
21,862,807
- --------------------------------------------------------------------------------
Diversified Operations - 2.3%
515,000 CBS Corp.* 18,346,875
- --------------------------------------------------------------------------------
Drug Delivery Systems - 1.5%
250,000 ALZA Corp.* 11,984,375
- --------------------------------------------------------------------------------
Educational Software - 1.6%
244,150 CBT Group PLC (ADR)* 12,421,131
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 1.7%
208,845 Applied Materials, Inc.* 7,544,526
150,000 Maxim Integrated Products, Inc.* 6,056,250
- --------------------------------------------------------------------------------
13,600,776
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 3.7%
306,010 Charles Schwab Corp. 10,710,350
125,000 Merrill Lynch & Co., Inc. 10,968,750
100,000 Morgan Stanley, Dean Witter, Discover and Co. 7,887,500
- --------------------------------------------------------------------------------
29,566,600
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 23
<PAGE>
JANUS OLYMPUS FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Finance - Other Services - 0.3%
46,060 Newcourt Credit Group, Inc. $ 2,262,697
- --------------------------------------------------------------------------------
Food - Diversified - 0.7%
125,000 Nabisco Holdings Corp. - Class A 5,976,562
- --------------------------------------------------------------------------------
Human Resources - 2.0%
580,000 Select Appointments Holdings PLC (ADR) 15,732,500
- --------------------------------------------------------------------------------
Internet Software - 3.0%
300,000 America Online, Inc.* 24,000,000
- --------------------------------------------------------------------------------
Medical - Drugs - 13.6%
175,000 Eli Lilly and Co. 12,173,438
1,696 Novartis A.G.** 2,804,166
320,000 Pfizer, Inc. 36,420,000
100,000 Schering-Plough Corp. 8,012,500
260,000 Warner-Lambert Co. 49,188,750
- --------------------------------------------------------------------------------
108,598,854
- --------------------------------------------------------------------------------
Medical - Wholesale Drug Distributors - 0.7%
61,025 Cardinal Health, Inc. 5,873,656
- --------------------------------------------------------------------------------
Money Center Banks - 4.1%
125,000 Bank of New York Co., Inc. 7,382,813
160,000 BankAmerica Corp. 13,600,000
770,392 Lloyds TSB Group PLC** 11,560,656
- --------------------------------------------------------------------------------
32,543,469
- --------------------------------------------------------------------------------
Multimedia - 3.6%
250,000 Time Warner, Inc. 19,625,000
75,000 Walt Disney Co. (The) 9,323,437
- --------------------------------------------------------------------------------
28,948,437
- --------------------------------------------------------------------------------
Networking Products - 3.9%
425,000 Cisco Systems, Inc.* 31,131,250
- --------------------------------------------------------------------------------
Radio - 0.7%
200,000 Westwood One, Inc.* 6,000,000
- --------------------------------------------------------------------------------
Retail - Building Products - 1.3%
150,000 Home Depot, Inc. 10,443,750
- --------------------------------------------------------------------------------
Retail - Discount - 1.7%
250,000 Costco Companies, Inc.* 13,968,750
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 1.8%
320,700 Fred Meyer, Inc.* 14,391,413
- --------------------------------------------------------------------------------
Retail - Restaurants - 1.2%
200,000 Starbucks Corp.* 9,625,000
- --------------------------------------------------------------------------------
Schools - 1.1%
240,000 DeVry, Inc.* 9,090,000
- --------------------------------------------------------------------------------
Schools - Day Care - 1.3%
395,425 CorporateFamily Solutions, Inc.*,# 10,528,191
- --------------------------------------------------------------------------------
Telecommunication Services - 3.4%
83,006 COLT Telecom Group PLC*,** 1,790,340
55,700 COLT Telecom Group PLC (ADR)*,** 4,797,163
150,000 Level 3 Communications, Inc.* 9,300,000
298,100 Qwest Communications International, Inc.* 11,495,481
- --------------------------------------------------------------------------------
27,382,984
- --------------------------------------------------------------------------------
Telephone - Local - 0.6%
50,000 Bell Atlantic Corp. 4,678,125
- --------------------------------------------------------------------------------
Telephone - Long Distance - 2.3%
200,000 MCI Communications Corp. 10,062,500
200,000 WorldCom, Inc.* 8,556,250
- --------------------------------------------------------------------------------
18,618,750
- --------------------------------------------------------------------------------
Total Common Stock (cost $544,047,565) 756,736,033
- --------------------------------------------------------------------------------
Preferred Stock - 1.6%
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 1.6%
5,000 Porsche A.G.** (cost $11,471,926) $ 12,510,470
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 0.7%
Prudential Funding Corp.
$ 5,600,000 5.45%, 5/1/98 (amortized cost $5,600,000) 5,600,000
- --------------------------------------------------------------------------------
Total Investments (total cost $561,119,491) - 96.8% 774,846,503
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 3.2% 26,025,172
- --------------------------------------------------------------------------------
Net Assets - 100% $ 800,871,675
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
France 0.9% $ 6,779,928
Germany 2.2% 17,307,634
Ireland 2.5% 19,902,381
Switzerland 0.4% 2,804,165
United Kingdom 3.8% 29,083,496
United States++ 90.2% 698,968,899
- --------------------------------------------------------------------------------
Total 100.0% $ 774,846,503
================================================================================
++Includes Short-Term Securities (89.5% excluding Short-Term Securities)
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 8/14/98 3,140,000 $ 5,224,018 ($95,142)
British Pound 10/7/98 4,760,000 7,901,124 (6,174)
French Franc 7/31/98 19,500,000 3,255,806 (3,096)
French Franc 10/19/98 17,000,000 2,850,484 (5,629)
German Deutschemark 7/2/98 20,300,000 11,345,853 (177,584)
Swiss Franc 10/21/98 3,800,000 2,582,048 2,635
- --------------------------------------------------------------------------------
Total $ 33,159,333 ($284,990)
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 24
<PAGE>
JANUS OVERSEAS FUND Portfolio Manager, Helen Young Hayes
Janus Overseas Fund once again outperformed its benchmark this period. The
Fund gained 17.55% for the six months ended April 30, 1998, compared with the
MSCI EAFE Index, which gained 15.44% during the same period. Both returns
include net reinvested dividends.(1)
I am also pleased to report that, for the 12-month period ended April 30,
1998, the Fund ranked 64th out of the 466 international funds tracked by Lipper
Analytical Services, Inc., a leading mutual fund rating company.(2)
Closing Janus Overseas Fund
Our biggest change during the half was the closing of Janus Overseas Fund
to new investors. As a rapid stream of assets continued to flow into the Fund,
I, along with Janus' Chief Investment Officer Jim Craig, decided to close the
Fund proactively in order to preserve its flexibility.
In conjunction with this decision was the well-deserved promotion of
Laurence Chang to co-manager of Janus Overseas Fund from his position as
assistant portfolio manager. Laurence, who has worked closely with me for the
past five years, also serves as assistant portfolio manager for Janus Worldwide
Fund.
In terms of the stock markets, many international markets moved steadily
higher this period, reflecting reduced investor concerns that the Asian crisis
would extend to other parts of the globe. The downturn in the Far East has thus
far been viewed as a positive for the global economy by investors, as prospects
for lower inflation and moderate economic growth drove several markets higher.
European Stocks Boost Performance
The European stock markets posted impressive gains this period, fueled by
the pending European Monetary Union (EMU) in 1999, corporate restructuring,
improving domestic economies, and the convergence of European interest rates.
Our European holdings fared well as a result, and because these stocks comprise
nearly 83.9% of the Fund, it posted strong returns.
Companies that focused on increasing shareholder value and accelerating
corporate earnings growth helped drive the performance of our European holdings.
French auto manufacturer Renault was among our strong performers.
Many European technology stocks also climbed significantly as a result of
an increase in computer spending in anticipation of the Year 2000 and European
Monetary Union conversions. U.K.-based companies Logica and Misys and Dutch
computer services provider Getronics are among our technology holdings that are
rapidly gaining momentum. Unfortunately, our position in JBA Holdings, a
U.K.-based software development company, did not fare so well. The stock was
down about 50% as a result of what I believe were accelerated research and
development costs coupled with a slowdown in new clients.
Growing Presence in Emerging Markets
The economic and political environment in Japan, Korea, and Southeast Asia
leave me wary about corporate earnings for the near term. I have modestly
increased the Fund's weighting in Latin America. My emphasis remains on strong,
high-quality franchise names such as Telebras in Brazil and Televisa in Mexico.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 98.1% 89.1%
Foreign 97.1% 88.1%
Top 10 Equities (% of Assets) 21.4% 22.6%
Number of Stocks 180 211
Cash & Fixed Income Securities 1.9% 10.9%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Rentokil Initial PLC 3.2% 2.2%
Siebe PLC 2.5% 2.8%
Wolters Kluwer N.V 2.1% 0.9%
Nokia Oyj - Class A 2.1% 1.8%
Electrolux A.B. - Class B 2.0% 2.5%
Philips Electronics N.V.
- N.Y. Shares 2.0% 2.6%
Mannesmann A.G 1.9% --
Akzo Nobel N.V 1.9% 2.2%
Telecom Italia Mobile S.p.A. 1.9% --
UBS 1.8% 0.3%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Money Center Banks 11.3% 6.1%
Diversified Operations 9.3% 9.8%
Medical - Drugs 7.2% 3.7%
Telephone - Integrated 5.7% 2.2%
Computer Services 5.1% 4.1%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Countries April 30, 1998 October 31, 1997
United Kingdom 19.9% 20.3%
Netherlands 11.7% 12.4%
Germany 11.5% 7.5%
France 8.3% 12.0%
Switzerland 8.1% 7.3%
- --------------------------------------------------------------------------------
Positive Global Market Outlook
Benign inflation and strong corporate restructuring actions should continue
to create a positive future environment for the global markets. In the last six
months alone, European companies have noticeably improved their earnings quality
and increased their productivity as changes in management incentives and a more
disciplined investment approach began to be felt.
While we continue to monitor macroeconomic trends closely, my primary focus
continues to be to identify the best companies anywhere in the world -
regardless of geography or market sentiment.
On behalf of the entire international investment team, I 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) Lipper Analytical Services, Inc. defines an international fund as one that
"invests its assets in securities whose primary trading markets are outside
the United States." As of April 30, 1998, Janus Overseas Fund ranked 1/277
of international funds for the 3-year period. This ranking is based on
total return, including reinvested dividends and capital gains for the
stated period.
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 25
<PAGE>
JANUS OVERSEAS FUND Portfolio Manager, Helen Young Hayes
Performance Overview
GRAPHIC
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Overseas Fund and the Morgan Stanley Capital International EAFE Index.
Janus Overseas Fund is represented by a solid blue line. The Morgan Stanley
Capital International 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 April 30, 1998. The
upper right quadrant reflects the ending value of the hypothetical investment in
Janus Overseas Fund ($21,896) as compared to the Morgan Stanley Capital
International EAFE Index ($13,864). 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 29.29% and 21.64%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS OVERSEAS FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 94.7%
- --------------------------------------------------------------------------------
Advertising Agencies - 0.3%
1,673,060 WPP Group PLC** $ 10,657,928
- --------------------------------------------------------------------------------
Advertising Sales - 0.1%
3,610,778 Aegis Group PLC**,+ 5,554,243
- --------------------------------------------------------------------------------
Airlines - 0.9%
517,191 Deutsche Lufthansa A.G.** 12,306,544
3,152 Sairgroup** 4,122,981
406,950 SAS Danmark A/S 7,255,091
357,605 SAS Norge ASA - Class B 5,969,614
521,464 SAS Sverige A.B.** 8,288,100
- --------------------------------------------------------------------------------
37,942,330
- --------------------------------------------------------------------------------
Appliances - 2.0%
912,610 Electrolux A.B. - Class B** 84,906,953
- --------------------------------------------------------------------------------
Athletic Footwear - 0.4%
92,150 Adidas - Salomon A.G.** 15,277,053
- --------------------------------------------------------------------------------
Audio and Video Products - 1.4%
742,400 Sony Corp.** 61,861,974
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 2.5%
17,803 Bayerische Motoren Werke (BMW) A.G.** 19,643,354
429,000 Honda Motor Co., Ltd.** 15,584,649
1,092,480 Renault S.A.*,** 50,650,370
25,643 Volkswagen A.G.** 20,420,122
- --------------------------------------------------------------------------------
106,298,495
- --------------------------------------------------------------------------------
Beverages - Non-Alcoholic - 0.1%
128,619 Embotelladora Andina S.A. (ADR) - Class B 2,604,535
- --------------------------------------------------------------------------------
Brewery - 0.7%
851,935 Companhia Cervejaria Brahma (ADR) 11,234,893
2,665,700 Fomento Economico Mexicano, S.A. de C.V. 19,719,101
- --------------------------------------------------------------------------------
30,953,994
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.6%
656,320 Grupo Televisa S.A. (GDR)* $ 26,909,120
- --------------------------------------------------------------------------------
Building - Heavy Construction - 0.3%
111,309 Compagnie Francaise d'Etudes et de
Construction Technip** 14,131,510
- --------------------------------------------------------------------------------
Cellular Telecommunications - 3.6%
387,593 Cellular Communications International, Inc.* 17,054,070
95,300 Millicom International Cellular S.A.* 3,728,612
88,104 Telecel-Comunicacaoes Pessoais, S.A.* 15,805,551
14,057,268 Telecom Italia Mobile S.p.A. 80,506,299
5,147,909 Telecom Italia S.p.A. 38,770,189
- --------------------------------------------------------------------------------
155,864,721
- --------------------------------------------------------------------------------
Chemicals - Diversified - 3.1%
404,884 Akzo Nobel N.V.** 82,358,907
242,863 BASF A.G.** 10,813,478
205,152 Bayer A.G.** 9,122,963
294,625 Hoechst A.G.** 11,885,171
1,113,753 Imperial Chemical Industries PLC** 20,223,438
- --------------------------------------------------------------------------------
134,403,957
- --------------------------------------------------------------------------------
Commercial Banks - 2.8%
383,057 Banco Central Hispanoamericano* 12,742,176
228,068 BG Bank A/S 13,331,110
241,062 Corporacion Bancaria de Espana S.A. 20,086,522
281,992 Credit Commercial de France** 22,492,770
2,428,205 Credito Italiano S.p.A. 12,705,953
205,397 Erste Bank Der Oesterreichischen
Sparkassen A.G.*,+ 13,239,824
2,370 Julius Baer Holding A.G. - Class B** 6,541,462
2,260,172 Merita PLC - Class A 15,142,250
135,800 Uniao de Bancos Brasileiros S.A. (GDR) 5,398,050
- --------------------------------------------------------------------------------
121,680,117
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 26
<PAGE>
JANUS OVERSEAS FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Commercial Services - 0.3%
1,323,790 BTG PLC** $ 14,475,485
- --------------------------------------------------------------------------------
Computer Services - 5.1%
152,295 Atos S.A.*,** 25,434,115
530,154 Cap Gemini S.A.** 62,889,116
88,630 ECsoft Group PLC (ADR)* 2,658,900
913,221 Getronics N.V.**,+ 40,406,529
2,109,225 Logica PLC** 55,720,662
490,088 Misys PLC** 23,558,530
346,645 WM-Data A.B. - Class B** 10,436,777
- --------------------------------------------------------------------------------
221,104,629
- --------------------------------------------------------------------------------
Computer Software - 2.2%
52,000 Dassault Systemes S.A. (ADR) 2,008,500
578,862 JBA Holdings PLC** 5,129,643
2,008,310 Merkantildata A.S.A. 25,312,318
1,026 NTT Data Corp.** 45,192,757
96,657 Tieto Corp. - Class B 17,741,460
- --------------------------------------------------------------------------------
95,384,678
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 1.0%
97,285 Saville Systems PLC (ADR)* 4,852,089
1,081,305 SEMA Group PLC** 39,105,783
- --------------------------------------------------------------------------------
43,957,872
- --------------------------------------------------------------------------------
Consumer Products - 0.3%
313,170 Hagemeyer N.V.** 14,957,038
- --------------------------------------------------------------------------------
Diversified Operations - 9.3%
5,804,000 Citic Pacific, Ltd. 17,832,981
22,601,800 First Pacific Co., Ltd. 10,868,983
1,906,886 Hays PLC** 32,425,147
851,000 Hutchison Whampoa, Ltd. 5,262,410
151,497 Lagardere S.C.A.** 5,790,243
55,694 Preussag A.G.** 19,800,965
284,740 Quinenco S.A. (ADR) 2,936,381
121,515 Ratin A/S - B Shares* 23,350,577
21,581,960 Rentokil Initial PLC** 140,731,645
4,754,270 Siebe PLC** 108,108,296
947,000 Swire Pacific, Ltd. - Class A 4,731,301
662,195 TI Group PLC** 5,978,826
2,722,883 Tomkins PLC** 16,048,128
1,494,294 Williams PLC** 11,467,929
- --------------------------------------------------------------------------------
405,333,812
- --------------------------------------------------------------------------------
Drug Delivery Systems - 0.9%
636,489 Elan Corp. PLC (ADR)* 39,541,879
- --------------------------------------------------------------------------------
Educational Software - 0.2%
177,860 CBT Group PLC (ADR)* 9,048,628
- --------------------------------------------------------------------------------
Electric - Distribution - 0.4%
3,904,000 CLP Holdings, Ltd. 18,748,751
- --------------------------------------------------------------------------------
Electric - Integrated - 0.2%
116,450 Companhia Energetica de Minas Gerais (ADR) 5,458,594
195,550 Companhia Paranaense de Energia-Copel (ADR) 2,786,588
56,575 Mosenergo (ADR)*,+ 2,008,412
- --------------------------------------------------------------------------------
10,253,594
- --------------------------------------------------------------------------------
Electric Products - 0.2%
528,000 Hitachi, Ltd.** 3,792,264
242,644 Samsung Electronics+ 6,830,429
- --------------------------------------------------------------------------------
10,622,693
- --------------------------------------------------------------------------------
Electronic Components - 3.5%
1,049,002 Electrocomponents PLC** 10,199,111
633,967 Philips Electronics N.V.** 55,850,207
942,346 Philips Electronics N.V. - N.Y. Shares** 84,811,140
- --------------------------------------------------------------------------------
150,860,458
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 0.2%
69,800 ASM Lithography Holding N.V. (ADR)* $ 6,395,425
- --------------------------------------------------------------------------------
Electronic Measuring Instruments - 0.2%
48,316 Simac Techniek N.V.** 8,584,669
- --------------------------------------------------------------------------------
Film Processing - 0.2%
170,368 GrandVision S.A.** 6,851,226
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 0.2%
591,000 Nomura Securities Co., Ltd.** 7,223,680
- --------------------------------------------------------------------------------
Finance - Other Services - 0.3%
239,630 Newcourt Credit Group, Inc. 11,771,824
- --------------------------------------------------------------------------------
Food - Catering - 0.7%
1,808,623 Compass Group PLC** 31,359,063
- --------------------------------------------------------------------------------
Food - Dairy Products - 0.2%
258,960 Koninklijke Numico N.V.** 8,651,165
- --------------------------------------------------------------------------------
Food - Diversified - 0.8%
195,162 Raisio Group PLC 35,822,122
- --------------------------------------------------------------------------------
Food - Retail - 0.9%
1,222,830 Koninklijke Ahold N.V.** 38,128,065
- --------------------------------------------------------------------------------
Human Resources - 1.1%
3,738,455 Capita Group PLC** 31,409,751
645,605 Select Appointments Holdings PLC** 8,991,831
323,955 Select Appointments Holdings PLC (ADR)** 8,787,279
- --------------------------------------------------------------------------------
49,188,861
- --------------------------------------------------------------------------------
Investment Companies - 0.3%
197,666 Investor A.B. - B Shares** 11,161,921
- --------------------------------------------------------------------------------
Investment Management and Advisory Services - 0.2%
625,382 Amvescap PLC** 7,110,343
539,733 Banca Fideuram 3,453,840
- --------------------------------------------------------------------------------
10,564,183
- --------------------------------------------------------------------------------
Life and Health Insurance - 0.9%
47,095 Schweizerische Lebensversicherungs-und
Rentenanstalt** 39,843,964
- --------------------------------------------------------------------------------
Machinery - General Industrial - 1.9%
106,363 Mannesmann A.G.** 84,402,990
- --------------------------------------------------------------------------------
Medical - Biomedical and Genetic - 0.2%
7,516 Ares-Serono Group - Class B** 10,773,364
- --------------------------------------------------------------------------------
Medical - Drugs - 7.2%
1,897,523 Astra A.B. - Class A** 38,986,092
503,723 Merck KGaA** 19,649,300
40,864 Novartis A.G.** 67,564,516
128,642 Novo Nordisk A/S - Class B 20,866,410
399,271 Rhone-Poulenc - Class A** 19,513,165
1,649 Roche Holding A.G.** 16,716,032
151,251 Sanofi S.A.** 18,322,752
248,401 Schering A.G.** 26,646,571
661,375 SmithKline Beecham PLC (ADR)** 39,393,148
81,965 Synthelabo** 12,326,561
1,092,000 Takeda Chemical Industries** 31,240,137
- --------------------------------------------------------------------------------
311,224,684
- --------------------------------------------------------------------------------
Medical - Wholesale Drug Distributors - 0.1%
284,158 Grupo Casa Autrey S.A. de C.V. (ADR) 3,765,093
- --------------------------------------------------------------------------------
Medical Products - 0.2%
634,434 Ortivus A.B. - B Shares*,**,# 10,657,500
- --------------------------------------------------------------------------------
Metal Processors and Fabricators - 1.0%
1,238,767 Assa Abloy A.B. - Class B** 43,219,419
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 27
<PAGE>
JANUS OVERSEAS FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Money Center Banks - 11.3%
5,229,926 Banca Commerciale Italiana $ 26,448,467
18,469,531 Banca di Roma* 34,146,661
453,080 Bank Austria A.G. 35,017,764
387,402 Barclays PLC** 11,179,926
106,832 Credit Suisse Group** 23,503,980
541,222 Deutsche Bank A.G.** 41,651,091
197,837 Dresdner Bank A.G.** 10,704,934
553,852 HSBC Holdings PLC** 17,483,645
674,914 ING Groep N.V.** 43,858,250
5,161,946 Lloyds TSB Group PLC** 77,461,194
1,954,636 National Westminster Bank PLC** 38,900,156
88,634 Schroders PLC** 4,238,407
1,274,954 Skandinaviska Enskilda Banken - Class A** 21,252,487
1,203,797 Standard Chartered PLC** 18,497,159
49,020 UBS** 78,958,038
97,385 Unidanmark A/S - Class A 8,182,799
- --------------------------------------------------------------------------------
491,484,958
- --------------------------------------------------------------------------------
Mortgage Banks - 0.8%
469,059 Deutsche Pfandbrief-und
Hypothekenbank A.G.** 36,202,162
- --------------------------------------------------------------------------------
Multi-Line Insurance - 4.9%
33,504 Allianz A.G.*,** 10,303,401
1,105,177 Assicurazioni Generali 33,090,128
114,130 Axa** 13,389,657
6,858 Baloise Holding, Ltd.** 15,883,763
196,214 ERGO Versicherungs Gruppe A.G.** 37,176,301
161,151 Groupe des Assurances Nationales*,** 4,587,280
5,490,532 Istituto Nazionale delle Assicurazioni 16,372,904
13,466 Pohjola Insurance Group - Class B 753,867
1,767,500 Royal & Sun Alliance Insurance Group PLC** 19,630,315
651,339 Sampo Insurance Co., Ltd. - Class A 29,410,217
51,878 Zurich Versicherungs-Gesellschaft** 31,612,259
- --------------------------------------------------------------------------------
212,210,092
- --------------------------------------------------------------------------------
Office Furnishings - 0.6%
726,868 Koninklijke Ahrend Groep N.V.**,# 25,182,087
- --------------------------------------------------------------------------------
Oil Companies - Integrated - 2.4%
436,366 Elf Aquitaine S.A.** 57,212,751
73,375 Lukoil Holding (ADR) 4,861,094
251,612 Total S.A.** 29,895,258
333,375 YPF S.A. (ADR) 11,626,453
- --------------------------------------------------------------------------------
103,595,556
- --------------------------------------------------------------------------------
Paper and Related Products - 0.1%
715,500 Kimberly-Clark de Mexico, S.A. de C.V. - Class A 3,510,273
- --------------------------------------------------------------------------------
Publishing - Books - 2.1%
701,940 Wolters Kluwer N.V.** 91,750,096
- --------------------------------------------------------------------------------
Recycling - 0.3%
446,547 Tomra Systems ASA 14,369,833
- --------------------------------------------------------------------------------
Reinsurance - 0.2%
17,782 Muenchener Rueckversicherungs-
Gesellschaft A.G.** 8,125,530
- --------------------------------------------------------------------------------
Retail - Discount - 0%
1,153,049 Cifra S.A. de C.V. 2,012,854
- --------------------------------------------------------------------------------
Retail - Pubs - 0.1%
916,030 J.D. Wetherspoon PLC** 4,931,759
- --------------------------------------------------------------------------------
Retail - Restaurants - 0.3%
96,742 Tele Pizza S.A.* 13,900,532
- --------------------------------------------------------------------------------
Security Services - 0.6%
682,612 Securitas A.B. - Class B** 25,138,787
- --------------------------------------------------------------------------------
Special Purpose Banks - 0.6%
48,719 Dexia Belgium (Credit Communal)+ $ 6,669,868
143,798 Dexia France** 17,395,990
- --------------------------------------------------------------------------------
24,065,858
- --------------------------------------------------------------------------------
Telecommunication Equipment - 3.2%
1,341,076 Nokia Oyj - Class A 89,846,735
155,945 Nokia Oyj (ADR) - Class A 10,428,822
455,437 Telefonaktiebolaget L.M. Ericsson - Class B** 24,011,208
260,166 Telefonaktiebolaget L.M. Ericsson (ADR)
- Class B** 13,382,289
- --------------------------------------------------------------------------------
137,669,054
- --------------------------------------------------------------------------------
Telecommunication Services - 1.7%
20,526,000 China Telecom, Ltd.*,+ 38,953,031
242,066 COLT Telecom Group PLC*,** 5,221,073
2,242,344 Energis PLC*,** 24,557,255
11,468,214 Freepages Group PLC*,** 6,902,947
- --------------------------------------------------------------------------------
75,634,306
- --------------------------------------------------------------------------------
Telephone - Integrated - 5.0%
902,563 Global TeleSystems Group, Inc.* 42,420,461
249,106 Hellenic Telecommunication Organization S.A.+ 7,129,874
7,843 Nippon Telegraph & Telephone Corp.** 68,855,509
434,675 Nortel Inversora S.A. (ADR) 12,931,581
360,351 Portugal Telecom S.A. 19,364,330
274,150 Telecom Argentina Stet S.A. (ADR) 9,869,400
509,235 Telefonica de Argentina S.A. (ADR) 19,637,375
91,475 Telefonica de Espana 3,817,085
560,720 Telefonos de Mexico S.A. (ADR) 31,750,770
- --------------------------------------------------------------------------------
215,776,385
- --------------------------------------------------------------------------------
Tobacco - 0.1%
298,900 Tabacalera S.A. - Class A+ 6,432,385
- --------------------------------------------------------------------------------
Travel Services - 1.2%
10,030 Kuoni Reisen A.G. - Class B** 53,829,820
- --------------------------------------------------------------------------------
Total Common Stock (cost $3,210,500,183) 4,118,747,992
- --------------------------------------------------------------------------------
Foreign Bonds - 0.4%
ECU
5,500,000 Cellular Communications International, Inc.,
zero coupon senior discount notes,
due 4/1/05+ 4,241,695
JPY
1,860,000,000 STB Cayman Capital, Ltd., 0.50%
bank guaranteed notes, due 10/1/07+ 11,683,946
- --------------------------------------------------------------------------------
Total Foreign Bonds (cost $20,343,124) 15,925,641
- --------------------------------------------------------------------------------
Preferred Stock - 3.4%
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 2.0%
35,340 Porsche A.G.** 88,423,998
- --------------------------------------------------------------------------------
Brewery - 0.1%
2,926,000 Companhia Cervejaria Brahma 1,905,449
- --------------------------------------------------------------------------------
Electric - Integrated - 0.2%
146,198,000 Companhia Energetica de Minas Gerais 7,092,530
49,000,000 Companhia Paranaense de Energia-Copel 685,303
- --------------------------------------------------------------------------------
7,777,833
- --------------------------------------------------------------------------------
Insurance Brokers - 0.3%
36,834 Marschollek, Lautenschlaeger
und Partner A.G.** 13,916,686
- --------------------------------------------------------------------------------
Oil Companies - Integrated - 0.1%
12,681,000 Petroleo Brasileiro S.A. 3,203,452
- --------------------------------------------------------------------------------
Telephone - Integrated - 0.7%
260,210 Telecomunicacoes Brasileiras S.A. (ADR) 31,696,831
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $134,856,614) 146,924,249
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 28
<PAGE>
JANUS OVERSEAS FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Rights - 0%
91,475 Telefonica de Espana* (cost $0) $ 70,820
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 0.9%
Household Finance Corp.
$ 37,900,000 5.51%, 5/1/98 (amortized cost $37,900,000) 37,900,000
- --------------------------------------------------------------------------------
Total Investments (total cost $3,403,599,921) - 99.4% 4,319,568,702
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 0.6% 27,077,234
- --------------------------------------------------------------------------------
Net Assets - 100% $ 4,346,645,936
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Argentina 1.3% $ 54,064,809
Austria 1.1% 48,257,588
Belgium 0.1% 6,669,868
Brazil 1.6% 69,461,688
Canada 0.3% 11,771,823
Chile 0.1% 5,540,915
Denmark 1.7% 72,985,987
Finland 4.6% 199,145,472
France 8.3% 356,802,992
Germany 11.5% 496,472,614
Greece 0.2% 7,129,874
Hong Kong 2.2% 96,397,455
Ireland 1.2% 53,442,595
Italy 5.8% 249,736,135
Japan 5.7% 245,434,915
Luxembourg 0.1% 3,728,612
Mexico 2.0% 87,667,210
Netherlands 11.7% 507,021,849
Norway 1.1% 45,651,764
Portugal 0.8% 35,169,880
Russia 0.2% 6,869,506
South Korea 0.2% 6,830,428
Spain 1.3% 57,049,520
Sweden 6.7% 291,441,532
Switzerland 8.1% 349,350,179
United Kingdom 19.9% 858,098,961
United States++ 2.2% 97,374,531
- --------------------------------------------------------------------------------
Total 100.0% $4,319,568,702
================================================================================
++Includes Short-Term Securities (1.4% excluding Short-Term Securities)
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 7/10/98 5,000,000 $ 8,331,500 ($116,500)
British Pound 8/7/98 83,000,000 138,128,600 (4,183,200)
British Pound 8/13/98 22,000,000 36,603,600 (1,051,600)
British Pound 10/7/98 33,000,000 54,776,700 (1,081,900)
Dutch Guilder 7/17/98 61,000,000 30,313,572 (288,589)
Dutch Guilder 7/23/98 15,000,000 7,456,751 (86,468)
Dutch Guilder 7/31/98 209,000,000 103,943,900 (865,776)
French Franc 5/28/98 4,000,000 665,447 (7,010)
French Franc 7/23/98 155,220,000 25,904,539 (277,992)
French Franc 7/31/98 375,780,000 62,741,890 (434,349)
French Franc 8/7/98 70,000,000 11,691,804 (156,733)
French Franc 10/21/98 20,000,000 3,353,848 (32,471)
German Deutschemark 5/28/98 2,800,000 1,561,977 11,941
German Deutschemark 7/2/98 109,277,000 61,075,899 (584,413)
German Deutschemark 7/10/98 28,123,000 15,725,229 (187,660)
German Deutschemark 10/21/98 22,000,000 12,369,975 (118,314)
Japanese Yen 7/23/98 7,410,000,000 55,792,353 3,701,826
Japanese Yen 8/7/98 2,370,000,000 17,844,907 407,624
Japanese Yen 10/7/98 3,840,000,000 28,915,815 622,646
Japanese Yen 10/21/98 1,960,000,000 14,759,414 868,576
Japanese Yen 11/4/98 920,000,000 6,928,029 361,987
Japanese Yen 11/19/98 5,500,000,000 41,418,438 4,537,444
Swedish Krona 7/2/98 231,000,000 29,902,526 (1,191,927)
Swedish Krona 7/17/98 84,500,000 10,943,611 (359,944)
Swedish Krona 8/7/98 21,000,000 2,721,547 (90,100)
Swedish Krona 8/14/98 25,000,000 3,240,651 (80,094)
Swiss Franc 5/28/98 8,500,000 5,679,920 122,128
Swiss Franc 6/26/98 65,329,000 43,803,808 1,397,419
Swiss Franc 7/10/98 1,671,000 1,122,305 30,904
Swiss Franc 7/17/98 13,000,000 8,738,321 264,449
Swiss Franc 7/23/98 4,000,000 2,690,523 84,557
Swiss Franc 7/31/98 6,000,000 4,039,588 127,079
- --------------------------------------------------------------------------------
Total $ 853,186,987 $ 1,343,540
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 29
<PAGE>
JANUS SPECIAL SITUATIONS FUND Portfolio Manager, David C. Decker
For the first half of the fiscal year, November 1, 1997, to April 30, 1998,
Janus Special Situations Fund gained 23.75%. The S&P 500 Index gained 22.50% for
the same period. Both returns include reinvested dividends.
The Fund ranked 14th out of 230 capital appreciation funds tracked by
Lipper Analytical Services, Inc., a leading mutual fund rating company, for the
12-month period ended April 30, 1998.(1)
Valuation Still Matters
While I am enthusiastic about the returns of your fund, I must also be
realistic about the sustainability of such returns. In truth, 24% is a pretty
good six-month return. Don't get me wrong, I have no reason to believe this bull
market is coming to an end. However, it is my nature to be skeptical and I
firmly believe the most dangerous points in the market occur when investors
become complacent about valuations and the returns that are being generated.
I view arguments about the "new era," where traditional approaches to
valuation are no longer relevant in a world of no inflation, low interest rates,
and strong sustainable growth, with a certain degree of skepticism. I maintain
that the prudent way to invest in a company is to understand valuation and to be
disciplined in its implementation. In other words, if you don't understand a
company's valuation today, how can you make a logical argument about its
valuation tomorrow? Remember, even great companies can become overvalued in a
frothy market.
Continue to Focus on Free Cash Flow
I am very focused on the free cash flow a company generates. My definition
of free cash flow is roughly the cash a company generates from its business less
the capital it needs to run its business. It is precisely the cash left over
from operations that can be reinvested at a high rate of return by management. I
am looking for those companies that are undervalued relative to that free cash
flow and have a management team committed to reinvesting it at a rate of return
that will increase the value of the firm.
There is no question it is becoming more challenging to find these
companies. Nonetheless, a recent trip to Europe uncovered a number of unique
investment opportunities with many of the characteristics mentioned above. Like
Tomkins PLC, which the Fund has owned since last year and was up 155% in the
period, these companies would benefit from improving return on invested capital
(ROIC) and accelerating free cash flow.
Some of the strongest performers this period were also top performers last
period. Federal Mogul was up 53%, driven by the excellent financial performance
achieved by Dick Snell and his management team. The company completed two
acquisitions (T&N and Fel Pro), which I believe will add significant value to
the firm during the next couple of years. Despite its excellent performance in
the past 15 months (up more than 150%), it remains the largest position in the
Fund because I believe there is a substantial amount of value that will be
created through the integration of T&N, Fel Pro, and Federal Mogul.
The most important contributor to the Fund this period was Bally Total
Fitness, up 73%. Bally should substantially improve its free cash flow as it
modestly increases prices and offers high margin ancillary products and services
such as personal training.
I made a significant investment in the cable industry to reflect my
conviction that the current value being accorded these companies does not
reflect the significance of the free cash flow they will generate in a few
years. Despite the fact that TCI returned 41% in the period, I still believe
there is plenty of room to go. I have in fact now taken significant positions in
Comcast, Media One, TCA Cable, and Time Warner to complement the TCI position. I
believe strongly that as the cable industry becomes less capital intensive
(i.e., uses less cash to fund the current business), investors will be able to
value the company's free cash flow, something that has not been possible since
the inception of the industry.
While there were no significant losers, there were stocks that did not
perform as well as I expected. I am consistently reevaluating my positions not
only to make sure the valuations are still attractive, but also to ensure the
upside potential is sufficient to warrant its position in the Fund. Dial, Emmis
Broadcasting, and AC Nielson were sold because I didn't believe the upside was
as significant as other ideas, including the cable companies mentioned earlier.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 98.9% 97.1%
Foreign 12.0% 17.1%
Top 10 Equities (% of Assets) 46.9% 42.3%
Number of Stocks 50 58
Cash & Cash Equivalents 1.1% 2.9%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Federal-Mogul Corp. 7.1% 7.3%
Time Warner, Inc. 5.9% 0.5%
CBS Corp. 5.8% --
Tele-Communications, Inc.
- Class A 4.7% 5.0%
Bally Total Fitness Holding Corp. 4.7% 4.3%
Chancellor Media Corp. 4.5% --
Valassis Communications, Inc. 3.8% 3.1%
Comcast Corp. - Special Class A 3.6% --
Alliant Techsystems, Inc. 3.6% --
Imperial Chemical Industries
PLC (ADR) 3.2% 4.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Cable Television 13.6% 5.0%
Diversified Operations 7.3% 8.4%
Automotive - Truck Parts
and Equipment 7.1% 7.3%
Printing - Commercial 5.9% 7.5%
Multimedia 5.9% 0.6%
- --------------------------------------------------------------------------------
Long-Term Outlook Appears Promising
In conclusion, it is not my job to forecast the direction of the general
market. My job is to uncover stocks that are uniquely positioned to improve
their cash flow characteristics and, therefore, hopefully compound value. While
the near-term vacillations of the market may affect the near-term performance of
the Fund, in the long term, I believe the Fund will compound value over time,
irrespective of the vacillations of the market.
I appreciate your continued support.
- --------------------------------------------------------------------------------
(1) A capital appreciation fund is defined by Lipper as one that "aims at
maximum capital appreciation, frequently by means of 100% or more portfolio
turnover, leveraging, purchasing unregistered securities, purchasing
options, etc. The fund may take large cash positions." This ranking is
based on total return, including reinvestment of dividends and capital
gains for the stated period.
Past performance does not guarantee future results. Investing in special
situation companies may entail greater risks.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 30
<PAGE>
JANUS SPECIAL SITUATIONS FUND Portfolio Manager, David C. Decker
Performance Overview
GRAPHIC
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Special Situations Fund and the S&P 500 Index. Janus Special Situations
Fund is represented by a solid blue 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, December 31, 1996,
through April 30, 1998. The upper right quadrant reflects the ending value of
the hypothetical investment in Janus Special Situations Fund ($17,424) as
compared to the S&P 500 Index ($15,349). There is a legend in the upper left
quadrant of the graph which indicates Janus Special Situations Fund's one-year
and since inception (December 31, 1996) average annual total returns as 60.89%
and 51.66%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS SPECIAL SITUATIONS FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares Market Value
- --------------------------------------------------------------------------------
Common Stock - 98.9%
- --------------------------------------------------------------------------------
Advertising Agencies - 0.7%
200,000 True North Communications, Inc. $ 6,100,000
- --------------------------------------------------------------------------------
Advertising Sales - 0.5%
150,000 Lamar Advertising Co. - Class A* 5,175,000
- --------------------------------------------------------------------------------
Aerospace and Defense - 3.6%
519,800 Alliant Techsystems, Inc.* 33,234,713
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 7.1%
1,010,000 Federal-Mogul Corp. 65,334,375
- --------------------------------------------------------------------------------
Cable Television - 13.6%
936,360 Comcast Corp. - Special Class A 33,533,392
348,580 TCA Cable TV, Inc. 21,524,815
1,350,000 Tele-Communications, Inc. - Class A* 43,537,500
699,740 US WEST Media Group* 26,415,185
- --------------------------------------------------------------------------------
125,010,892
- --------------------------------------------------------------------------------
Chemicals - Diversified - 4.6%
400,000 Imperial Chemical Industries PLC (ADR) 29,075,000
470,000 Solutia, Inc. 13,336,250
- --------------------------------------------------------------------------------
42,411,250
- --------------------------------------------------------------------------------
Chemicals - Specialty - 1.0%
175,000 Cytec Industries, Inc.* 9,581,250
- --------------------------------------------------------------------------------
Circuits - 1.2%
50,000 Analog Devices, Inc.* 1,946,875
110,000 Linear Technology Corp. 8,855,000
- --------------------------------------------------------------------------------
10,801,875
- --------------------------------------------------------------------------------
Commercial Banks - 2.8%
50,000 First Empire State Corp. 25,500,000
- --------------------------------------------------------------------------------
Commercial Services - 1.1%
300,000 Gartner Group, Inc. - Class A* 9,937,500
- --------------------------------------------------------------------------------
Computer Software - 0.7%
200,000 Parametric Technology Co.* $ 6,393,750
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 2.8%
968,800 Wang Laboratories, Inc.* 26,157,600
- --------------------------------------------------------------------------------
Consumer Products - 0.4%
160,000 Gibson Greetings, Inc.* 4,185,000
- --------------------------------------------------------------------------------
Cosmetics and Toiletries - 1.7%
1,019,700 Playtex Products, Inc.* 15,741,619
- --------------------------------------------------------------------------------
Direct Marketing - 2.4%
420,000 Catalina Marketing Corp.* 21,840,000
- --------------------------------------------------------------------------------
Diversified Operations - 7.3%
1,488,800 CBS Corp.* 53,038,500
2,395,197 Tomkins PLC** 14,116,812
- --------------------------------------------------------------------------------
67,155,312
- --------------------------------------------------------------------------------
Drug Delivery Systems - 0.4%
196,550 Atrix Laboratories, Inc.* 3,587,037
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 4.2%
475,000 Maxim Integrated Products, Inc.* 19,178,125
300,000 Texas Instruments, Inc. 19,218,750
- --------------------------------------------------------------------------------
38,396,875
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 0.4%
100,000 Charles Schwab Corp. 3,500,000
- --------------------------------------------------------------------------------
Heart Monitors - 0.2%
147,500 Endocardial Solutions, Inc.* 1,806,875
- --------------------------------------------------------------------------------
Human Resources - 0.2%
276,423 Capita Group PLC** 2,322,451
- --------------------------------------------------------------------------------
Machinery - Farm - 0.9%
300,000 AGCO Corp. 8,025,000
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 31
<PAGE>
JANUS SPECIAL SITUATIONS FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares Market Value
- --------------------------------------------------------------------------------
Machinery - General Industrial - 1.3%
917,400 ITEQ, Inc.*,# $ 11,696,850
- --------------------------------------------------------------------------------
Medical - Drugs - 1.9%
872,110 Astra A.B. - Class A** 17,918,181
- --------------------------------------------------------------------------------
Money Center Banks - 4.5%
231,130 Bank of New York Co., Inc. 13,651,116
655,475 Barclays PLC** 18,916,169
610,979 Lloyds TSB Group PLC** 9,168,473
- --------------------------------------------------------------------------------
41,735,758
- --------------------------------------------------------------------------------
Multimedia - 5.9%
687,365 Time Warner, Inc. 53,958,153
- --------------------------------------------------------------------------------
Oil Companies - Exploration and Production - 1.1%
1,503,075 Magnum Hunter Resources, Inc.*,# 10,239,698
- --------------------------------------------------------------------------------
Printing - Commercial - 5.9%
900,000 Valassis Communications, Inc.* 35,325,000
590,000 World Color Press, Inc.* 18,880,000
- --------------------------------------------------------------------------------
54,205,000
- --------------------------------------------------------------------------------
Publishing - Newspapers - 2.7%
50,000 Central Newspapers, Inc. - Class A 3,662,500
718,420 Harte-Hanks Communications, Inc. 16,299,154
350,000 Hollinger International, Inc. 5,425,000
- --------------------------------------------------------------------------------
25,386,654
- --------------------------------------------------------------------------------
Publishing - Periodicals - 0.1%
24,600 CMP Media, Inc. - Class A* 568,875
- --------------------------------------------------------------------------------
Radio - 4.5%
866,005 Chancellor Media Corp.* 41,081,112
- --------------------------------------------------------------------------------
Real Estate Investment Trusts - 0%
100,000 Property Capital Trust 75,000
- --------------------------------------------------------------------------------
Recreational Centers - 4.7%
1,403,100 Bally Total Fitness Holding Corp.*,# 43,145,325
- --------------------------------------------------------------------------------
Retail - Apparel and Shoe - 0.2%
400,000 Charming Shoppes, Inc.* 1,862,500
- --------------------------------------------------------------------------------
Shipbuilding - 2.2%
733,000 Newport News Shipbuilding, Inc. 19,928,438
- --------------------------------------------------------------------------------
Telephone - Long Distance - 1.8%
280,000 AT&T Corp. 16,817,500
- --------------------------------------------------------------------------------
Television - 4.3%
600,000 Scandinavian Broadcasting System S.A.* 19,050,000
405,000 Young Broadcasting Corp. - Class A* 20,250,000
- --------------------------------------------------------------------------------
39,300,000
- --------------------------------------------------------------------------------
Total Common Stock (cost $764,880,824) 910,117,418
- --------------------------------------------------------------------------------
Total Investments (total cost $764,880,824) - 98.9% 910,117,418
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 1.1% 9,775,344
- --------------------------------------------------------------------------------
Net Assets - 100% $ 919,892,762
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Luxembourg 2.1% $ 19,050,000
Sweden 2.0% 17,918,181
United Kingdom 8.1% 73,598,905
United States 87.8% 799,550,332
- --------------------------------------------------------------------------------
Total 100.0% $ 910,117,418
================================================================================
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 7/10/98 6,500,000 $ 10,830,950 ($261,950)
British Pound 8/13/98 12,525,000 20,839,095 (417,495)
British Pound 10/7/98 23,975,000 39,796,103 82,982
Swedish Krona 8/7/98 126,000,000 16,329,281 (475,889)
- --------------------------------------------------------------------------------
Total $ 87,795,429 ($1,072,352)
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 32
<PAGE>
JANUS TWENTY FUND Portfolio Manager, Scott W. Schoelzel
Janus Twenty Fund continued to perform well this first half of our fiscal
year. The Fund gained 26.90% compared to the S&P 500 Index, which was up 22.50%
for the same period. Both returns include reinvested dividends.
I'm also pleased to report that, for the 12 months ended April 30, 1998,
Janus Twenty Fund ranked 27th out of 230, or in the top 12%, of funds in the
capital appreciation category as tracked by Lipper Analytical Services, a
leading mutual fund rating company.(1)
Janus Twenty Fund continues to invest in a combination of large, dominant
multinational companies and faster-growing medium-sized companies. This
strategy, coupled with our increased research effort - including the addition of
five new analysts - helped the fund achieve its impressive performance. As the
backbone of our investment team, I can't say enough about the quality and
caliber of our analytical staff.
We benefited from our pharmaceutical, technology, telecommunications
equipment and financial services holdings, whose products and services were much
in sync with demographic and economic trends in the U.S. and abroad. Overall,
the Fund continued to reflect my conviction that these industries offer the most
dynamic prospects for growth.
Solid Company Fundamentals Prevail
The Fund's weighting in technology helped drive its performance. Companies
that excelled in this industry possessed strong management, solid earnings and
long-term growth potential. Among the leaders was Dell Computer Corp., which
recorded a 61% first-quarter increase in its stock price. Dell serves as a model
of efficiency and customer responsiveness in its industry. Unlike most of its
competitors, the company builds computers to customer specifications, and has a
business model that continues to demonstrate superiority quarter after quarter.
Microsoft was another strong performer. Currently, the company's software
is in high demand in the U.S. and in Europe, and I anticipate that the
introduction of Windows 98 this year, and NT 5.0 early next year, should further
boost earnings. I'm continuing to monitor the government's antitrust suit, and
at this time believe Microsoft has a strong case. In any event, its stock price
may drift for awhile even though, in my view, its fundamental prospects remain
intact.
Another top-performing technology stock during the period was America
Online. AOL's dominance is evident in its shift from nonconventional to
traditional advertisers who have recognized that 40% to 50% of individuals
signing up for online services move through the AOL gateway. At this time, AOL's
subscription base is larger than its 15 nearest competitors combined, including
some of the biggest names in the telecommunications industry.
Breakthroughs in prescription drugs produced substantial gains in several
of our pharmaceutical holdings. Pfizer's impressive launch of Viagra, a male
impotence treatment, logged over 36,000 prescriptions in its initial week on the
market. Lipitor, Warner-Lambert's market-leading anti-cholesterol drug
(co-marketed with Pfizer), recently reached an annual sales level of $1.5
billion from its January '97 introduction.
Warner Lambert's performance was also boosted by rising sales of Rezulin, a
treatment for adult-onset diabetes. Rezulin prescriptions dropped briefly late
in 1997 following news of possible liver damage linked to the drug. As these
concerns subsided, the increase in Rezulin sales proved good news for the
company, which consistently maintains a full product pipeline.
Unfortunately, Eli Lilly was a pharmaceutical stock that did not meet our
expectations. While the fundamentals of this stock remained intact, slow sales
from the launch of Evista, a hormone replacement drug, hurt the stock's
performance early in the year. However, our continued research indicates Evista
may still become an effective treatment for osteoporosis, and thus is a
situation we continue to monitor closely.
When is a Stock Too High to Buy?
The persistence of several key economic factors steered us toward uncharted
waters in terms of creating an economy that's seemingly healthier than ever
before. Among these factors were benign inflation, low interest rates and
booming businesses in both the U.S. and Europe - all driving the markets to
unseen heights. As a result, some investors have become skeptical about whether
today's companies are worth their steep stock prices.
While we do not buy or sell a stock based on any single factor, our
analysts continually examine a wide range of the fundamentals we believe make
for strong investments. What we've learned is - in up and down markets - there
are always great companies, and we'll continue to find them.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 88.6% 91.0%
Foreign 2.4% 4.2%
Top 20 Equities (% of Assets) 82.2% 80.1%
Top 10 Equities (% of Assets) 57.2% 53.1%
Number of Stocks 29 34
Cash & Fixed Income Securities 11.4% 9.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Dell Computer Corp. 8.7% 5.7%
Pfizer, Inc. 7.9% 5.2%
Microsoft Corp. 7.7% 5.0%
Warner-Lambert Co. 5.9% 4.6%
General Electric Co. 5.1% 4.4%
America Online, Inc. 4.9% 1.8%
Monsanto Co. 4.9% 5.8%
Eli Lilly and Co. 4.8% 4.6%
Cisco Systems, Inc. 4.0% 1.5%
Lucent Technologies, Inc. 3.3% 5.2%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Medical - Drugs 18.6% 14.4%
Computer Software 10.1% 5.0%
Computers - Micro 8.7% 5.7%
Diversified Operations 6.8% 5.2%
Money Center Banks 5.3% 4.5%
- --------------------------------------------------------------------------------
Going Forward
I anticipate that the economy will stay healthy. Low inflation, strong
domestic growth and high consumer confidence should all continue. The economic
crisis in Asia, while still difficult to predict, seems to have settled for the
time being. Our strategy going forward will be to continue focusing on companies
with predictable earnings, solid growth potential, strong market presence and a
powerful franchise.
In closing, I'd like to thank you for investing with Janus Twenty Fund. You
have my personal commitment that we are all working very hard on your behalf.
- --------------------------------------------------------------------------------
(1) A capital appreciation fund is defined by Lipper as one that "aims at
maximum capital appreciation, frequently by means of 100% or more portfolio
turnover, leveraging, purchasing unregistered securities, purchasing
options, etc. The fund may take large cash positions." As of April 30,
1998, Janus Twenty Fund ranked 4/132 capital appreciation funds for the
3-year period, 9/87 for the 5-year period, and 1/55 funds for the 10-year
period. This ranking is based on total return, including reinvestment of
dividends and capital gains for the stated period.
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 33
<PAGE>
JANUS TWENTY FUND Portfolio Manager, Scott W. Schoelzel
Performance Overview
GRAPHIC
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 blue 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, April 30, 1985, through April 30, 1998.
The upper right quadrant reflects the ending value of the hypothetical
investment in Janus Twenty Fund ($96,660) as compared to the S&P 500 Index
($91,051). 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 52.08%, 23.11%, 23.07% and
19.07%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS TWENTY FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 88.6%
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 4.9%
7,432,025 Monsanto Co. $ 392,968,322
- --------------------------------------------------------------------------------
Airlines - 1.5%
1,401,560 UAL Corp.*,# 122,198,512
- --------------------------------------------------------------------------------
Applications Software - 0.7%
994,337 Intuit, Inc.* 52,886,299
- --------------------------------------------------------------------------------
Beverages - Non-Alcoholic - 1.1%
2,365,625 Coca-Cola Enterprises, Inc. 89,302,344
- --------------------------------------------------------------------------------
Cable Television - 0.5%
1,192,550 Tele-Communications, Inc. - Class A* 38,459,738
- --------------------------------------------------------------------------------
Commercial Services - 1.5%
3,650,075 Cendant Corp.* 91,251,875
600,000 Quintiles Transnational Corp.* 29,700,000
- --------------------------------------------------------------------------------
120,951,875
- --------------------------------------------------------------------------------
Computer Software - 10.1%
6,944,000 Microsoft Corp.* 625,828,000
381,594 SAP A.G.** 190,318,864
- --------------------------------------------------------------------------------
816,146,864
- --------------------------------------------------------------------------------
Computers - Micro - 8.7%
8,731,820 Dell Computer Corp.* 705,094,465
- --------------------------------------------------------------------------------
Diversified Operations - 6.8%
3,900,000 CBS Corp.* 138,937,500
4,862,300 General Electric Co. 413,903,287
- --------------------------------------------------------------------------------
552,840,787
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 0.5%
857,998 SLM Holding Corp. 36,625,790
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 2.6%
2,426,905 Merrill Lynch & Co., Inc. 212,960,914
- --------------------------------------------------------------------------------
Finance - Mortgage Loan Banker - 3.2%
4,352,975 Fannie Mae $ 260,634,378
- --------------------------------------------------------------------------------
Internet Software - 4.9%
4,945,880 America Online, Inc.* 395,670,400
- --------------------------------------------------------------------------------
Medical - Drugs - 18.6%
5,584,875 Eli Lilly and Co. 388,497,867
5,596,015 Pfizer, Inc. 636,896,457
2,530,725 Warner-Lambert Co. 478,781,536
- --------------------------------------------------------------------------------
1,504,175,860
- --------------------------------------------------------------------------------
Money Center Banks - 5.3%
1,950,000 BankAmerica Corp. 165,750,000
1,731,575 Citicorp 260,602,038
- --------------------------------------------------------------------------------
426,352,038
- --------------------------------------------------------------------------------
Multimedia - 3.3%
3,370,879 Time Warner, Inc. 264,614,001
- --------------------------------------------------------------------------------
Networking Products - 4.0%
4,364,987 Cisco Systems, Inc.* 319,735,298
- --------------------------------------------------------------------------------
Radio - 0.4%
725,975 Chancellor Media Corp.* 34,438,439
- --------------------------------------------------------------------------------
Retail - Building Products - 1.7%
2,000,000 Home Depot, Inc. 139,250,000
- --------------------------------------------------------------------------------
Super-Regional Banks - 2.6%
1,678,375 U.S. Bancorp 213,153,625
- --------------------------------------------------------------------------------
Telecommunication Equipment - 3.3%
3,536,620 Lucent Technologies, Inc. 269,225,197
- --------------------------------------------------------------------------------
Telecommunication Services - 0.3%
600,000 Qwest Communications International, Inc.* 23,137,500
- --------------------------------------------------------------------------------
Telephone - Long Distance - 2.1%
3,985,745 WorldCom, Inc.* 170,515,153
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 34
<PAGE>
JANUS TWENTY FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Total Common Stock (cost $4,586,932,820) $ 7,161,337,799
- --------------------------------------------------------------------------------
Corporate Bonds - 3.8%
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 1.5%
Fred Meyer, Inc.:
$ 70,000,000 7.375% senior notes, due 3/1/05 70,262,500
50,000,000 7.45% senior notes, due 3/1/08 49,875,000
- --------------------------------------------------------------------------------
120,137,500
- --------------------------------------------------------------------------------
Telecommunication Services - 2.3%
190,000,000 Level 3 Communications, Inc., 9.125%
senior notes, due 5/1/08 188,100,000
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $309,031,723) 308,237,500
- --------------------------------------------------------------------------------
U.S. Government Obligation - 2.5%
195,000,000 U.S. Treasury Note, 6.125%
due 11/15/27 (cost $200,930,572) 199,711,200
- --------------------------------------------------------------------------------
Money Market - 0.1%
Janus Government Money Market Fund
6,000,000 5.58% (cost $6,000,000) 6,000,000
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 0.9%
Household Finance Corp.
68,300,000 5.51%, 5/1/98 (amortized cost $68,300,000) 68,300,000
- --------------------------------------------------------------------------------
Time Deposit - 1.4%
First Union Bank North Carolina EDT
115,000,000 5.50%, 5/1/98 (cost $115,000,000) 115,000,000
- --------------------------------------------------------------------------------
U.S. Government Agencies - 1.8%
Fannie Mae:
50,000,000 5.70%, 6/30/98 49,549,500
100,000,000 5.75%, 7/27/98 98,697,000
- --------------------------------------------------------------------------------
Total U.S. Government Agencies (cost $148,254,750) 148,246,500
- --------------------------------------------------------------------------------
Total Investments (total cost $5,434,449,865) - 99.1% 8,006,832,999
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 0.9% 71,389,578
- --------------------------------------------------------------------------------
Net Assets - 100% $ 8,078,222,577
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Germany 2.4% $ 190,318,864
United States++ 97.6% 7,816,514,135
- --------------------------------------------------------------------------------
Total 100.0% $8,006,832,999
================================================================================
++Includes Short-Term Securities (93.4% excluding Short-Term Securities)
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
German Deutschemark 7/2/98 151,850,000 $ 84,870,333 ($2,123,460)
German Deutschemark 7/23/98 51,150,000 28,621,789 (238,493)
German Deutschemark 10/19/98 95,000,000 53,409,794 (59,331)
- --------------------------------------------------------------------------------
Total $ 166,901,916 ($2,421,284)
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 35
<PAGE>
JANUS VENTURE FUND
Portfolio Managers, William H. Bales, Jonathan D. Coleman, James P. Craig
In our last report to you, we discussed an aggressive restructuring plan
for Janus Venture Fund. We are pleased to report now that our new approach is
beginning to pay off. The Fund delivered a six-month total return of 12.61% as
of April 30, 1998. Its benchmark, the Russell 2000 Index of small company
stocks, gained 11.88% including reinvested dividends.
Following a similar trend of the last several years, small-cap stocks have
underperformed large-cap stocks as investors have placed an emphasis on more
liquid stocks. Despite the recent under-performance, there are good reasons to
remain optimistic about the small-cap market.
Asia and Its Effect on the Fund
There is still great uncertainty about the impact of the recent Asian
economic weakness on the U.S. markets. Determining the impact the Asian economic
crisis has had on small-cap stocks is difficult. In general, small U.S.
companies have less exposure to the Asian economies than larger multinational
corporations and should continue to exhibit good growth rates regardless of the
health of foreign economies.
Against this backdrop, we sought to diversify the Janus Venture Fund,
adding names in sectors that had previously been under- represented. We
decreased investments in industrial, economically sensitive stocks and increased
the Fund's exposure to technology, bio-sciences, and media. We have reduced the
number of stocks held in the Fund from 200 to approximately 125.
Looking for "Open-Ended Growth Stories"
We believe there are great small-cap franchises with "open-ended growth
stories" that will drive long-term earnings growth and, ultimately, substantial
share price appreciation. Growth opportunities may be a product of management's
vision and determination, a unique market niche, new technology, or some
combination of these. As long as these core strengths remain intact, it's only a
matter of time before the market recognizes and responds to them.
On the positive side, our investments in the agri-biotech companies, Delta
and Pine Land Co. and Dekalb Genetics, proved very rewarding. Both companies are
leaders in agricultural genetics and seed biotechnology. Controlling the patents
for genetically engineered seeds that are disease-resistant will be a critically
important asset as agricultural companies strive to increase yields and reduce
losses. Both companies recently received tender offers to be acquired by
Monsanto Corporation.
Another outstanding performer was Orbital Sciences. Orbital has a
substantial business and leading market share in building and launching small
satellites. We're particularly excited about their ORBCOMM division, which will
provide services to companies based on data collected by Orbital-controlled
satellites. Potential applications include such diverse services as fleet
management and logistics for trucking companies and remote meter reading for
utilities spurred by deregulation to provide power to new geographies.
We also had success with Romac, a specialty staffing company concentrating
on high-skilled temporary workers in accounting/ finance and information
technology. Romac recently acquired a similar company, Source Services, which
gives the combined company a better presence in the top 40 U.S. cities. We
believe the company will continue to grow at fast rates as demand for the
"Knowledge Force" continues to increase. On a recent visit to Romac
headquarters, we observed the sense of purpose senior management instilled
across the entire company. The top four senior executives sit in cubicles amidst
other employees. There are no "executive" offices with special perks. Everyone
pursues a common goal from the same workplace.
We did have disappointments during the quarter. Our oil and gas holdings
were hit hard by a reduction in oil prices, which in turn depressed the demand
for drilling and exploration. We responded by paring back our investments in the
sector, selling such stocks as Camco International, Stolt Comex Seaway, and EVI.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 95.8% 96.4%
Foreign 4.4% 5.6%
European 4.1% 3.8%
Top 10 Equities (% of Assets) 22.1% 17.1%
Number of Stocks 124 197
Cash & Cash Equivalents 4.2% 3.6%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Delta and Pine Land Co. 3.5% 2.1%
Federal-Mogul Corp. 2.5% 1.7%
Wind River Systems 2.4% 0.9%
First Empire State Corp. 2.3% 2.0%
Pittway Corp. - Class A 2.2% 1.3%
Orbital Sciences Corp. 2.0% --
Heftel Broadcasting Corp.
- Class A 1.9% 0.7%
Romac International, Inc. 1.8% --
TCA Cable TV, Inc. 1.8% --
Engineering Animation, Inc. 1.7% 0.5%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Commercial Banks 6.2% 4.6%
Medical Drugs 4.5% 2.4%
Computer Software 4.1% 2.4%
Savings/Loan/Thrifts 4.0% 10.1%
Computer Services 3.8% 2.8%
- --------------------------------------------------------------------------------
More Resources, More Opportunities
Our ability to identify potential winners has always depended upon our
commitment to intensive, hands-on research. Smaller companies, because of their
sometimes illiquid trading patterns, often receive scant coverage by market
analysts. We do not rely heavily on outside research, and we believe this gives
us an advantage in identifying the great undiscovered franchise names. With our
management and research team firmly in place, we're able to search out
compelling opportunities, maintaining the broad diversification we believe is
essential to small-cap investing.
At the same time, fewer stocks in the Fund allow us to focus more closely
on the fundamentals of each. This means visiting the companies we own and
meeting with management at all levels of the organization. We supplement this
hands-on research by talking to a company's competitors, customers, and
suppliers, which gives us a more complete picture of the investment. We do not
want to be scared out of great companies because of market fluctuations. We feel
such careful security analysis is vital and gives us conviction that our
judgment is correct when broader market turmoil might otherwise cause us alarm.
Thank you for your ongoing support as we continue to take the necessary
steps to pursue the kind of performance you expect.
- --------------------------------------------------------------------------------
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 36
<PAGE>
JANUS VENTURE FUND
Portfolio Managers, William H. Bales, Jonathan D. Coleman, James P. Craig
Performance Overview
GRAPHIC
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 blue line. 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 April 30, 1998. The upper right quadrant reflects the ending value of
the hypothetical investment in Janus Venture Fund ($75,987) as compared to the
Russell 2000 Index ($53,742). 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 41.97%, 13.60%,
16.73% and 16.88%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS VENTURE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 95.8%
- --------------------------------------------------------------------------------
Advertising Sales - 1.6%
350,000 Lamar Advertising Co. - Class A* $ 12,075,000
233,310 Outdoor Systems, Inc.* 7,407,592
- --------------------------------------------------------------------------------
19,482,592
- --------------------------------------------------------------------------------
Aerospace and Defense - 2.0%
573,695 Orbital Sciences Corp.* 25,529,427
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 1.4%
250,000 DEKALB Genetics Corp. - Class B 17,046,875
- --------------------------------------------------------------------------------
Agricultural Operations - 3.5%
941,821 Delta and Pine Land Co. 43,382,630
- --------------------------------------------------------------------------------
Airlines - 0.8%
255,900 Ryanair Holdings PLC (ADR)* 9,820,163
- --------------------------------------------------------------------------------
Applications Software - 1.9%
100,000 HNC Software, Inc.* 3,900,000
250,000 Policy Management Systems Corp.* 20,156,250
- --------------------------------------------------------------------------------
24,056,250
- --------------------------------------------------------------------------------
Automotive -Truck Parts and Equipment - 2.5%
475,000 Federal-Mogul Corp. 30,726,563
- --------------------------------------------------------------------------------
Building Products - Lighting Fixtures - 0.9%
400,000 Advanced Lighting Technologies, Inc.* 11,100,000
- --------------------------------------------------------------------------------
Cable Television - 2.5%
350,000 Adelphia Communications Corp. - Class A* 9,843,750
352,420 TCA Cable TV, Inc. 21,761,935
- --------------------------------------------------------------------------------
31,605,685
- --------------------------------------------------------------------------------
Chemicals - Diversified - 0.4%
100,000 Cambrex Corp. 5,550,000
- --------------------------------------------------------------------------------
Circuits - 0.8%
490,000 SIPEX Corp.* 9,738,750
- --------------------------------------------------------------------------------
Commercial Banks - 6.2%
193,025 Community Financial Corp.# $ 4,439,575
54,900 First Empire State Corp. 27,999,000
191,200 Investors Financial Services Corp. 10,300,900
461,600 National Commerce Bancorporation 20,656,600
200,000 U.S. Trust Corp. 14,200,000
- --------------------------------------------------------------------------------
77,596,075
- --------------------------------------------------------------------------------
Commercial Services - 2.1%
447,900 Central Parking Corp. 20,995,312
50,000 International Telecommunication Data
Systems, Inc.* 1,512,500
131,250 NCO Group, Inc.* 3,273,047
- --------------------------------------------------------------------------------
25,780,859
- --------------------------------------------------------------------------------
Computer Data Security - 0.1%
50,000 VeriSign, Inc.* 1,918,750
- --------------------------------------------------------------------------------
Computer Graphics - 1.7%
450,000 Engineering Animation, Inc.*,# 21,206,250
- --------------------------------------------------------------------------------
Computer Services - 3.8%
101,905 BrightStar Information Technology Group, Inc.* 1,592,266
52,200 Ceridian Corp.* 2,952,563
291,900 Ciber, Inc.* 9,486,750
300,000 Cotelligent Group, Inc.* 7,743,750
33,935 DA Consulting Group, Inc.* 598,104
203,700 ECsoft Group PLC (ADR)* 6,111,000
342,855 Logica PLC 9,057,406
50,985 Manhattan Associates, Inc.* 1,153,536
263,455 Technology Solutions Co.* 8,463,492
- --------------------------------------------------------------------------------
47,158,867
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 37
<PAGE>
JANUS VENTURE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Computer Software - 4.1%
200,000 Aspen Technology, Inc.* $ 9,775,000
55,000 Brio Technology, Inc.* 605,000
126,627 JBA Holdings PLC 1,122,118
100,000 Learning Co., Inc.* 2,862,500
234,000 Micromuse, Inc.* 5,206,500
91,555 Mobius Management Systems, Inc.* 1,693,768
852,337 Wind River Systems* 29,512,169
- --------------------------------------------------------------------------------
50,777,055
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 0.6%
285,200 Wang Laboratories, Inc.* 7,700,400
- --------------------------------------------------------------------------------
Computers - Memory Devices - 0.4%
95,650 VERITAS Software Corp.* 5,236,838
- --------------------------------------------------------------------------------
Consulting Services - 0.2%
116,050 Charles River Associates, Inc.* 2,785,200
- --------------------------------------------------------------------------------
Data Processing and Management - 2.3%
92,510 Applied Graphics Technologies, Inc.* 4,625,500
269,555 CSG Systems International, Inc.* 12,264,753
95,550 i2 Technologies, Inc.* 6,377,963
150,000 INSpire Insurance Solutions, Inc.* 5,043,750
- --------------------------------------------------------------------------------
28,311,966
- --------------------------------------------------------------------------------
Diagnostic Equipment - 0.5%
200,000 Sabratek Corp.* 6,500,000
- --------------------------------------------------------------------------------
Direct Marketing - 0.6%
142,470 Catalina Marketing Corp.* 7,408,440
- --------------------------------------------------------------------------------
Diversified Operations - 0.6%
236,100 Roper Industries, Inc. 7,319,100
- --------------------------------------------------------------------------------
Drug Delivery Systems - 0.4%
251,900 Atrix Laboratories, Inc.* 4,597,175
- --------------------------------------------------------------------------------
Electric Products - 0.1%
78,200 Littelfuse, Inc.* 1,974,550
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 0.9%
400,000 ATMI, Inc.* 11,150,000
- --------------------------------------------------------------------------------
Electronic Safety Devices - 2.2%
363,637 Pittway Corp. - Class A 27,181,866
- --------------------------------------------------------------------------------
Entertainment Software - 0.6%
1,000,000 Acclaim Entertainment, Inc.* 7,625,000
- --------------------------------------------------------------------------------
Fiber Optics - 0.7%
300,000 Metromedia Fiber Network, Inc. - Class A* 9,262,500
- --------------------------------------------------------------------------------
Finance - Leasing Companies - 0.2%
36,000 Resource America, Inc. 2,412,000
- --------------------------------------------------------------------------------
Finance - Mortgage Loan Banker - 1.7%
594,400 Doral Financial Corp. 20,878,300
- --------------------------------------------------------------------------------
Finance - Other Services - 1.2%
300,000 HealthCare Financial Partners, Inc.* 15,112,500
- --------------------------------------------------------------------------------
Food - Retail - 1.0%
300,000 Dominick's Supermarkets, Inc.* 12,018,750
- --------------------------------------------------------------------------------
Food - Wholesale - 1.3%
450,000 U.S. Foodservice, Inc.* 15,890,625
- --------------------------------------------------------------------------------
Health Care Cost Containment - 1.5%
600,000 Concentra Managed Care, Inc.* 18,675,000
- --------------------------------------------------------------------------------
Hotels and Motels - 0.9%
175,000 Cavanaughs Hospitality Corp.* 2,745,312
300,000 Extended Stay America, Inc.* 3,918,750
250,000 Suburban Lodges of America, Inc.* 4,625,000
- --------------------------------------------------------------------------------
11,289,062
- --------------------------------------------------------------------------------
Human Resources - 2.9%
59,120 Provant, Inc.* $ 1,101,110
200,000 RemedyTemp, Inc. - Class A* 6,350,000
863,325 Romac International, Inc.* 22,878,112
200,000 Select Appointments Holdings PLC (ADR) 5,425,000
- --------------------------------------------------------------------------------
35,754,222
- --------------------------------------------------------------------------------
Instruments - Scientific - 0.9%
203,050 Dionex Corp.* 10,837,794
- --------------------------------------------------------------------------------
Leisure and Recreation and Gaming - 1.2%
500,000 AMF Bowling, Inc.* 14,468,750
- --------------------------------------------------------------------------------
Lottery Services - 0.6%
200,000 GTECH Holdings Corp.* 7,175,000
- --------------------------------------------------------------------------------
Medical - Biomedical and Genetic - 2.1%
236,300 Immunex Corp.* 16,216,087
141,431 QIAGEN N.V.* 9,246,052
- --------------------------------------------------------------------------------
25,462,139
- --------------------------------------------------------------------------------
Medical - Drugs - 4.5%
100,000 Algos Pharmaceuticals Corp.* 3,287,500
300,000 Cellegy Pharmaceuticals, Inc.* 1,706,250
300,000 Forest Laboratories, Inc.* 10,856,250
400,000 MedImmune, Inc.* 21,100,000
400,000 Sepracor, Inc.* 18,500,000
- --------------------------------------------------------------------------------
55,450,000
- --------------------------------------------------------------------------------
Medical - Generic Drugs - 1.4%
396,400 Watson Pharmaceuticals, Inc.* 17,045,200
- --------------------------------------------------------------------------------
Medical - HMO - 0.7%
350,000 Healthcare Recoveries, Inc.* 8,356,250
- --------------------------------------------------------------------------------
Medical Instruments - 0.9%
89,000 ESC Medical Systems, Ltd.* 2,892,500
100,000 Sofamor Danek Group, Inc.* 8,775,000
- --------------------------------------------------------------------------------
11,667,500
- --------------------------------------------------------------------------------
Medical Products - 2.6%
452,500 Henry Schein, Inc.* 17,647,500
300,000 MiniMed, Inc.* 15,000,000
- --------------------------------------------------------------------------------
32,647,500
- --------------------------------------------------------------------------------
Metal Processors and Fabricators - 0.4%
200,000 CompX International, Inc.* 5,025,000
- --------------------------------------------------------------------------------
Music/Clubs - 0.3%
100,000 SFX Entertainment, Inc. - Class A* 3,450,000
- --------------------------------------------------------------------------------
Office Furnishings - 0.6%
225,200 Knoll, Inc.* 7,839,775
- --------------------------------------------------------------------------------
Pharmacy Services - 1.4%
310,000 NCS HealthCare, Inc. - Class A* 9,106,250
250,000 Omnicare, Inc. 8,562,500
- --------------------------------------------------------------------------------
17,668,750
- --------------------------------------------------------------------------------
Printing - Commercial - 1.5%
469,225 Valassis Communications, Inc.* 18,417,081
- --------------------------------------------------------------------------------
Professional Sports - 0.2%
150,000 Championship Auto Racing Teams, Inc.* 2,831,250
- --------------------------------------------------------------------------------
Property and Casualty Insurance - 0.7%
354,650 Philadelphia Consolidated Holding Corp.* 8,201,281
- --------------------------------------------------------------------------------
Radio - 2.2%
36,700 Cox Radio, Inc. - Class A* 1,775,362
526,195 Heftel Broadcasting Corp. - Class A* 23,086,806
52,685 Jacor Communications, Inc.* 2,996,459
- --------------------------------------------------------------------------------
27,858,627
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 38
<PAGE>
JANUS VENTURE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Real Estate Investment Trusts - 0.3%
167,725 Correctional Properties Trust* $ 3,868,158
- --------------------------------------------------------------------------------
Recreational Centers - 1.0%
400,000 Bally Total Fitness Holding Corp.* 12,300,000
- --------------------------------------------------------------------------------
Rental Auto/Equipment - 1.5%
400,000 Rent-Way, Inc.* 12,550,000
200,000 Renters Choice, Inc.* 5,475,000
- --------------------------------------------------------------------------------
18,025,000
- --------------------------------------------------------------------------------
Resorts and Theme Parks - 1.6%
350,000 Premier Parks, Inc.* 19,468,750
- --------------------------------------------------------------------------------
Retail - Arts and Crafts - 0%
18,500 Michaels Stores, Inc.* 559,625
- --------------------------------------------------------------------------------
Retail - Bedding - 1.0%
200,000 Linens `N Things, Inc.* 12,050,000
- --------------------------------------------------------------------------------
Retail - Catalog Shopping - 1.1%
260,000 MSC Industrial Direct Co., Inc. - Class A* 13,227,500
- --------------------------------------------------------------------------------
Retail - Pubs - 0.8%
1,813,155 J.D. Wetherspoon PLC 9,761,736
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 1.4%
400,000 Fred Meyer, Inc.* 17,950,000
- --------------------------------------------------------------------------------
Retail - Restaurants - 1.5%
450,000 Papa John's International, Inc.* 18,787,500
- --------------------------------------------------------------------------------
Savings/Loan/Thrifts - 4.0%
150,000 Ambanc Holding Co., Inc. 2,662,500
165,000 Catskill Financial Corp. 2,928,750
192,125 First Bergen Bancorp# 3,650,375
242,350 First Defiance Financial Corp. 3,635,250
165,000 First Mutual Bancorp, Inc. 3,093,750
120,400 FirstSpartan Financial Corp. 5,538,400
200,000 Flushing Financial Corp. 5,325,000
257,100 Home Bancorp of Elgin, Inc. 4,499,250
66,275 JSB Financial, Inc. 3,665,836
110,500 Provident Financial Holdings, Inc.* 2,596,750
101,250 Queens County Bancorp, Inc. 4,632,187
245,000 South Street Financial Corp.# 2,572,500
175,000 WesterFed Financial Corp. 4,593,750
- --------------------------------------------------------------------------------
49,394,298
- --------------------------------------------------------------------------------
Schools - 0.5%
500,000 Computer Learning Centers, Inc.* 6,000,000
- --------------------------------------------------------------------------------
Telecommunication Equipment - 0.5%
230,800 GeoTel Communications Corp.* 6,375,850
- --------------------------------------------------------------------------------
Television - 0.9%
279,185 Univision Communications, Inc. - Class A* 10,696,275
- --------------------------------------------------------------------------------
Vitamins and Nutrition Products - 0.4%
136,610 Twinlab Corp.* 5,361,942
- --------------------------------------------------------------------------------
Total Common Stock (cost $820,400,160) 1,189,788,816
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 3.1%
Household Finance Corp.
$38,800,000 5.51%, 5/1/98 (amortized cost $38,800,000) 38,800,000
- --------------------------------------------------------------------------------
Total Investments (total cost $859,200,160) - 98.9% 1,228,588,816
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 1.1% 13,243,877
- --------------------------------------------------------------------------------
Net Assets - 100% $ 1,241,832,693
- --------------------------------------------------------------------------------
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Ireland 0.8% $ 9,820,163
Israel 0.3% 3,545,750
Netherlands 0.8% 9,246,051
United Kingdom 2.5% 31,477,261
United States++ 95.6% 1,174,499,591
- --------------------------------------------------------------------------------
Total 100.0% $1,228,588,816
================================================================================
++Includes Short-Term Securities (92.4% excluding Short-Term Securities)
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 39
<PAGE>
JANUS WORLDWIDE FUND Portfolio Manager, Helen Young Hayes
I am pleased to report that Janus Worldwide Fund gained 20.61% for the
six-month period ended April 30, 1998, while its benchmark, the Morgan Stanley
International World Index, was up 18.86%. Both returns include net reinvested
dividends.(1)
The Fund achieved a top-quartile performance rating again from Lipper
Analytical Services, Inc., a leading mutual fund rating company. For the
12-month period ended April 30, 1998, Janus Worldwide Fund ranked 38th out of
193 global funds.(2)
After a turbulent start to the year, most international markets moved
steadily higher during the first quarter, despite lingering concerns that the
Asian crisis would spread to other parts of the globe. Investors soon realized,
however, that the downturn in the Far East could actually be a positive for the
global economy. As prospects for lower inflation and moderate economic growth
increased, many markets moved higher. Although the Fund wasn't completely
insulated from the events that unfolded in Asia, our limited exposure minimized
their effects.
- --------------------------------------------------------------------------------
Portfolio Profile April 30, 1998 October 31, 1997
Equities 97.1% 94.1%
Foreign 74.0% 78.1%
European 64.4% 65.3%
Top 10 Equities (% of Assets) 20.3% 21.1%
Number of Stocks 176 207
Cash & Cash Equivalents 2.9% 5.9%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 10 Equity Holdings April 30, 1998 October 31, 1997
Rentokil Initial PLC 2.8% 2.4%
Microsoft Corp. 2.3% 0.7%
Siebe PLC 2.1% 2.1%
Cisco Systems, Inc. 2.0% 1.4%
Philips Electronics N.V.
- N.Y. Shares 2.0% 3.1%
Mannesman A.G 2.0% --
Akzo Nobel N.V 1.9% 2.2%
UBS 1.8% 0.3%
Monsanto Co. 1.7% 1.7%
Parametric Technology Co. 1.7% 1.4%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Industries April 30, 1998 October 31, 1997
Diversified Operations 11.0% 10.5%
Money Center Banks 9.5% 5.1%
Medical - Drugs 9.1% 6.8%
Computer Software 5.5% 4.2%
Computer Services 4.0% 3.4%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Top 5 Countries April 30, 1998 October 31, 1997
United States 23.3% 16.5%
United Kingdom 13.7% 15.3%
Germany 9.1% 7.4%
Netherlands 9.0% 12.1%
France 7.8% 11.2%
- --------------------------------------------------------------------------------
Still Cautious About Japan
Our travels earlier in the year convinced us to trim positions in
developing Asian markets as well as Japan. Even so, the Fund was modestly hurt
by Japan's Nippon Telegraph & Telephone, NTT Data, and Sony Corporation, all of
which underperformed because of the nation's ongoing economic malaise.
The Japanese government is attempting to stimulate the economy through a
proposed reform package. However, Japanese companies still have not embraced the
corporate restructuring and shareholder value reforms that have propelled the
U.S. economic expansion. Until Japan properly addresses these and other
structural issues, we remain cautious about investing there.
European Markets Steady and Strong
Our European holdings, which comprise approximately 65% of the Fund, fared
much better.
The pending European Monetary Union (EMU) in 1999, the ongoing move toward
corporate restructuring, improving domestic economies, and the convergence of
European interest rates have all been powerful drivers of continental expansion.
Also driving the market was the continued consolidation among European
industries.
Among the better performing European stocks were several financial services
companies that benefited from a drop in interest rates. Banca Commerciale
Italiana and Banc di Roma were among some of our financial services stocks that
rose more than 25%. Our European information technology stocks also fared well
as a result of a positive economic backdrop and increased computer spending
stimulated by the Year 2000 and EMU conversions.
Positive Performers in the U.S.
U.S. technology stocks were also among our winning picks. Our holdings in
Microsoft, Cisco Systems, and Parametric Technology, discounted by the October
sell-off, rebounded nicely, boosting the Fund's performance. I remain
enthusiastic about these companies because of their dominant market positions,
differentiated product lines, and limited Asian exposure.
Many of our other U.S. stocks also performed well as interest rates and
inflation stayed low and company fundamentals and profitability remained intact.
Expanded Emerging Markets Presence
Although our near-term outlook for the economies of Korea and Southeast
Asia remains uncertain, other developing countries, such as those in Latin
America, are home to a number of compelling companies. Investing selectively in
the Janus tradition, we increased the Fund's emerging markets weighting slightly
by buying strong, high-quality franchise names at discounts, such as Telebras
and China Telecom International Cellular.
The Future of Global Markets
As a whole, I am optimistic about global markets. First, I believe
inflation will stay benign. Second, I continue to see - especially in Europe -
that companies are growing, improving their productivity, restructuring their
businesses, and repurchasing stock. All of these trends lead to improvements in
earnings quality, which are fundamental to any company's success. We remain
cautious about prospects in Southeast Asia, but we continue to set our sights on
companies that can prosper regardless of the economic climate.
In closing, I want to say that all of us on the international team at Janus
appreciate your confidence and remain committed to seeking the strong
performance you expect.
- --------------------------------------------------------------------------------
(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 as one that "invests at least 25% of its
portfolio in securities traded outside the United States and may own U.S.
securities as well." As of April 30, 1998, Janus Worldwide Fund was ranked
1/119 for the 3-year period, and 2/54 for the 5-year period. This ranking
is based on total return, including reinvested dividends and capital gains
for the stated period.
Past performance does not guarantee future results.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 40
<PAGE>
JANUS WORLDWIDE FUND Portfolio Manager, Helen Young Hayes
Performance Overview
GRAPHIC
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Worldwide Fund and the Morgan Stanley Capital International World
Index. Janus Worldwide Fund is represented by a solid blue line. The Morgan
Stanley Capital 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 April 30,
1998. The upper right quadrant reflects the ending value of the hypothetical
investment in Janus Worldwide Fund ($39,728) as compared to the Morgan Stanley
Capital International World Index ($23,920). There is a legend in the upper left
quadrant of the graph which indicates Janus Worldwide Fund's one-year, five-year
and since inception (May 15, 1991) average annual total returns as 34.25%,
23.00% and 21.93%, respectively.
*The Fund's inception date Source - Lipper Analytical Services, Inc. 1998.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. All returns reflect reinvested dividends. The
Fund's portfolio may differ significantly from the securities in the Index. The
Index is unmanaged and therefore does not reflect the cost of portfolio
management or trading.
JANUS WORLDWIDE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 96.3%
Agricultural Biotechnology - 1.7%
4,518,165 Monsanto Co. $ 238,897,974
- --------------------------------------------------------------------------------
Airlines - 0.9%
1,692,138 Deutsche Lufthansa A.G.** 40,264,371
9,540 Sairgroup** 12,478,819
1,400,201 SAS Danmark A/S 24,962,736
1,197,144 SAS Norge ASA - Class B# 19,984,305
1,790,855 SAS Sverige A.B.** 28,463,681
- --------------------------------------------------------------------------------
126,153,912
- --------------------------------------------------------------------------------
Appliances - 1.6%
2,389,364 Electrolux A.B. - Class B** 222,300,453
- --------------------------------------------------------------------------------
Applications Software - 1.0%
804,936 Intuit, Inc.* 42,812,533
2,042,730 PeopleSoft, Inc.* 94,986,945
- --------------------------------------------------------------------------------
137,799,478
- --------------------------------------------------------------------------------
Athletic Footwear - 0.4%
302,448 Adidas - Salomon A.G.** 50,141,226
- --------------------------------------------------------------------------------
Audio and Video Products - 1.4%
2,379,500 Sony Corp.** 198,276,625
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 2.2%
57,981 Bayerische Motoren Werke (BMW) A.G.** 63,974,685
3,651,526 Renault S.A.*,** 169,294,762
87,124 Volkswagen A.G.** 69,378,882
- --------------------------------------------------------------------------------
302,648,329
- --------------------------------------------------------------------------------
Brewery - 0.5%
2,590,525 Companhia Cervejaria Brahma (ADR) 34,162,548
4,145,700 Fomento Economico Mexicano, S.A. de C.V. 30,667,171
- --------------------------------------------------------------------------------
64,829,719
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.4%
1,463,725 Grupo Televisa S.A. (GDR)* $ 60,012,725
- --------------------------------------------------------------------------------
Building - Heavy Construction - 0.3%
368,748 Compagnie Francaise d'Etudes
et de Construction Technip** 46,815,315
- --------------------------------------------------------------------------------
Cable Television - 2.3%
3,547,620 Comcast Corp. - Special Class A 127,049,141
5,886,300 Tele-Communications, Inc. - Class A* 189,833,175
- --------------------------------------------------------------------------------
316,882,316
- --------------------------------------------------------------------------------
Cellular Telecommunications - 1.6%
895,133 Cellular Communications International, Inc.*,# 39,385,830
33,736,000 China Telecom, Ltd.*,+ 64,022,188
177,900 Millicom International Cellular S.A.* 6,960,338
129,883 Telecom Italia Mobile S.p.A. 743,843
15,949,437 Telecom Italia S.p.A. 120,119,195
- --------------------------------------------------------------------------------
231,231,394
- --------------------------------------------------------------------------------
Chemicals - Diversified - 3.8%
1,300,227 Akzo Nobel N.V.** 264,483,838
1,676,190 E.I. du Pont de Nemours and Co. 122,047,584
634,924 Hoechst A.G.** 25,612,831
2,273,716 Imperial Chemical Industries PLC** 41,285,953
2,973,530 Solutia, Inc. 84,373,914
- --------------------------------------------------------------------------------
537,804,120
- --------------------------------------------------------------------------------
Circuits - 0%
151,300 Analog Devices, Inc.* 5,891,244
- --------------------------------------------------------------------------------
Commercial Banks - 2.1%
1,267,546 Banco Central Hispanoamericano* 42,164,208
526,696 BG Bank A/S 30,786,618
783,965 Corporacion Bancaria de Espana S.A. 65,323,982
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 41
<PAGE>
JANUS WORLDWIDE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Commercial Banks - (continued)
778,189 Credit Commercial de France** $ 62,071,358
10,795,404 Credito Italiano S.p.A.* 56,488,599
7,703 Julius Baer Holding A.G. - Class B** 21,261,130
437,325 Uniao de Bancos Brasileiros S.A. (GDR) 17,383,669
- --------------------------------------------------------------------------------
295,479,564
- --------------------------------------------------------------------------------
Commercial Services - 0.4%
1,060,950 Quintiles Transnational Corp.* 52,517,025
- --------------------------------------------------------------------------------
Computer Services - 4.0%
566,691 Atos S.A.*,**,# 94,640,559
1,533,400 Cap Gemini S.A.** 199,008,402
2,826,216 Getronics N.V.**,+ 125,049,225
1,542,951 Logica PLC** 40,761,062
1,149,836 Misys PLC** 55,272,617
1,547,050 WM-Data A.B. - Class B** 46,578,533
- --------------------------------------------------------------------------------
561,310,398
- --------------------------------------------------------------------------------
Computer Software - 5.5%
344,400 Dassault Systemes S.A. (ADR) 13,302,450
2,273,484 JBA Holdings PLC**,# 20,146,706
2,429,040 Merkantildata A.S.A. 30,615,110
3,591,750 Microsoft Corp.* 323,706,469
3,297 NTT Data Corp.**,# 145,224,678
7,449,805 Parametric Technology Co.* 238,160,953
- --------------------------------------------------------------------------------
771,156,366
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 0.1%
472,415 SEMA Group PLC** 17,085,058
- --------------------------------------------------------------------------------
Consumer Products - 0.3%
1,020,852 Hagemeyer N.V.** 48,756,019
- --------------------------------------------------------------------------------
Data Processing and Management - 0.2%
766,290 First Data Corp. 25,958,074
- --------------------------------------------------------------------------------
Diversified Operations - 11.0%
3,289,780 CBS Corp.* 117,198,413
1,575,000 Citic Pacific, Ltd. 4,839,239
50,527,400 First Pacific Co., Ltd. 24,298,128
9,606,179 Hays PLC** 163,345,773
3,074,000 Hutchison Whampoa, Ltd. 19,008,987
656,836 Lagardere S.C.A.** 25,104,392
180,745 Preussag A.G.** 64,260,520
406,009 Ratin A/S - B Shares* 78,019,540
60,657,830 Rentokil Initial PLC** 395,537,578
12,843,220 Siebe PLC** 292,044,548
3,186,500 Swire Pacific, Ltd. - Class A 15,920,052
3,120,612 TI Group PLC** 28,175,382
8,897,566 Tomkins PLC** 52,440,474
4,349,365 Tyco International, Ltd. 237,040,393
4,230,213 Williams PLC** 32,464,685
- --------------------------------------------------------------------------------
1,549,698,104
- --------------------------------------------------------------------------------
Drug Delivery Systems - 0.3%
696,025 Elan Corp. PLC (ADR)* 43,240,553
- --------------------------------------------------------------------------------
Electric - Integrated - 0.1%
65,350 Companhia Energetica de Minas Gerais (ADR) 3,063,281
660,275 Companhia Paranaense de Energia-Copel (ADR) 9,408,919
131,225 Mosenergo (ADR)*,+ 4,658,487
- --------------------------------------------------------------------------------
17,130,687
- --------------------------------------------------------------------------------
Electric Products - 0.1%
1,738,000 Hitachi, Ltd.** 12,482,871
- --------------------------------------------------------------------------------
Electronic Components - 3.5%
3,874,885 Electrocomponents PLC** 37,674,267
2,043,044 Philips Electronics N.V.** 179,984,812
3,066,515 Philips Electronics N.V. - N.Y. Shares** 275,986,350
- --------------------------------------------------------------------------------
493,645,429
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 1.7%
227,475 ASM Lithography Holding N.V. (ADR)* $ 20,842,397
3,383,850 Texas Instruments, Inc. 216,777,891
- --------------------------------------------------------------------------------
237,620,288
- --------------------------------------------------------------------------------
Film Processing - 0%
48,047 GrandVision S.A.** 1,932,175
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 0.1%
98,755 Household International, Inc. 12,980,110
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 0.2%
252,155 Morgan Stanley, Dean Witter, Discover and Co. 19,888,726
605,000 Nomura Securities Co., Ltd.** 7,394,799
- --------------------------------------------------------------------------------
27,283,525
- --------------------------------------------------------------------------------
Finance - Other Services - 0.2%
513,520 Newcourt Credit Group, Inc. 25,226,670
- --------------------------------------------------------------------------------
Food - Catering - 0.8%
6,190,527 Compass Group PLC** 107,335,319
- --------------------------------------------------------------------------------
Food - Dairy Products - 0.6%
2,386,067 Koninklijke Numico N.V.** 79,712,154
- --------------------------------------------------------------------------------
Food - Diversified - 1.3%
308,373 Danone** 72,766,186
566,803 Raisio Group PLC 104,037,088
- --------------------------------------------------------------------------------
176,803,274
- --------------------------------------------------------------------------------
Food - Retail - 0.6%
370,450 Disco S.A. (ADR)* 14,725,388
2,032,739 Koninklijke Ahold N.V.** 63,381,178
- --------------------------------------------------------------------------------
78,106,566
- --------------------------------------------------------------------------------
Human Resources - 0.4%
5,875,452 Capita Group PLC** 49,364,372
- --------------------------------------------------------------------------------
Investment Companies - 0.3%
642,352 Investor A.B. - B Shares** 36,272,714
- --------------------------------------------------------------------------------
Investment Management and Advisory Services - 0.2%
1,700,937 Amvescap PLC** 19,338,973
1,753,865 Banca Fideuram 11,223,270
- --------------------------------------------------------------------------------
30,562,243
- --------------------------------------------------------------------------------
Life and Health Insurance - 1.0%
173,039 Schweizerische Lebensversicherungs-und
Rentenanstalt** 146,396,850
- --------------------------------------------------------------------------------
Machinery - General Industrial - 2.0%
345,835 Mannesmann A.G.** 274,432,914
- --------------------------------------------------------------------------------
Medical - Biomedical and Genetic - 0.2%
16,011 Ares-Serono Group - Class B** 22,950,018
- --------------------------------------------------------------------------------
Medical - Drugs - 9.1%
6,210,301 Astra A.B. - Class A** 127,595,493
1,327,375 Bristol-Myers Squibb Co. 140,535,828
841,820 Eli Lilly and Co. 58,559,104
1,629,502 Merck KGaA** 63,563,851
134,701 Novartis A.G.** 222,714,562
438,072 Novo Nordisk A/S - Class B 71,057,586
498,400 Pfizer, Inc. 56,724,150
1,318,566 Rhone-Poulenc - Class A** 64,440,933
5,326 Roche Holding A.G.** 53,990,046
784,507 Schering A.G.** 84,155,949
1,096,825 SmithKline Beecham PLC (ADR) 65,329,639
3,745,000 Takeda Chemical Industries** 107,137,649
886,998 Warner-Lambert Co. 167,808,934
- --------------------------------------------------------------------------------
1,283,613,724
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 42
<PAGE>
JANUS WORLDWIDE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Medical - Wholesale Drug Distributors - 0.3%
230,300 Cardinal Health, Inc. $ 22,166,375
1,587,813 Grupo Casa Autrey S.A. de C.V. (ADR)# 21,038,522
- --------------------------------------------------------------------------------
43,204,897
- --------------------------------------------------------------------------------
Metal Processors and Fabricators - 1.1%
4,577,514 Assa Abloy A.B. - Class B**,# 159,705,172
- --------------------------------------------------------------------------------
Money Center Banks - 9.5%
25,715,421 Banca Commerciale Italiana 130,046,478
29,975,350 Banca di Roma* 55,418,738
1,217,477 Bank Austria A.G. 94,096,678
249,650 BankAmerica Corp. 21,220,250
1,245,253 Barclays PLC** 35,936,408
338,021 Credit Suisse Group** 74,367,595
1,790,767 Deutsche Bank A.G.** 137,812,948
634,664 Dresdner Bank A.G.** 34,341,587
1,542,774 HSBC Holdings PLC** 48,701,302
122,630 ING Groep N.V.** 7,968,922
13,953,434 Lloyds TSB Group PLC** 209,388,021
3,356,923 National Westminster Bank PLC** 66,807,747
286,406 Schroders PLC** 13,695,697
4,202,693 Skandinaviska Enskilda Banken - Class A** 70,055,609
3,292,137 Standard Chartered PLC** 50,585,924
160,358 UBS** 258,293,617
325,804 Unidanmark A/S - Class A 27,375,763
- --------------------------------------------------------------------------------
1,336,113,284
- --------------------------------------------------------------------------------
Mortgage Banks - 1.0%
1,777,707 Deutsche Pfandbrief-und
Hypothekenbank A.G.** 137,204,141
- --------------------------------------------------------------------------------
Multi-Line Insurance - 3.7%
110,994 Allianz A.G.*,** 34,133,706
2,432,516 Assicurazioni Generali 72,832,014
370,864 Axa** 43,509,521
24,138 Baloise Holding, Ltd.** 55,905,844
571,991 ERGO Versicherungs Gruppe A.G.** 108,374,068
349,106 Groupe des Assurances Nationales*,** 9,937,556
10,470,849 Istituto Nazionale delle Assicurazioni 31,224,334
5,975,042 Royal & Sun Alliance Insurance Group PLC** 66,360,370
166,733 Zurich Versicherungs-Gesellschaft** 101,600,039
- --------------------------------------------------------------------------------
523,877,452
- --------------------------------------------------------------------------------
Multimedia - 0.8%
1,437,085 Time Warner, Inc. 112,811,172
- --------------------------------------------------------------------------------
Networking Products - 2.0%
3,777,087 Cisco Systems, Inc.* 276,671,623
- --------------------------------------------------------------------------------
Oil Companies - Integrated - 1.9%
1,427,277 Elf Aquitaine S.A.** 187,132,919
213,900 Lukoil Holding (ADR) 14,170,875
254,833 Total S.A.** 30,277,961
1,199,150 YPF S.A. (ADR) 41,820,356
- --------------------------------------------------------------------------------
273,402,111
- --------------------------------------------------------------------------------
Paper and Related Products - 0.1%
2,357,900 Kimberly-Clark de Mexico, S.A. de C.V.
- Class A 11,567,955
- --------------------------------------------------------------------------------
Publishing - Books - 1.3%
1,413,657 Wolters Kluwer N.V.** 184,778,137
- --------------------------------------------------------------------------------
Recycling - 0.3%
1,463,428 Tomra Systems ASA# 47,092,952
- --------------------------------------------------------------------------------
Reinsurance - 0.2%
58,911 Muenchener Rueckversicherungs-
Gesellschaft A.G.** 26,919,532
- --------------------------------------------------------------------------------
Retail - Discount - 0.2%
3,825,234 Cifra S.A. de C.V. $ 6,677,631
384,115 Costco Companies, Inc.* 21,462,426
- --------------------------------------------------------------------------------
28,140,057
- --------------------------------------------------------------------------------
Security Services - 0.9%
3,617,675 Securitas A.B. - Class B**,# 133,229,361
- --------------------------------------------------------------------------------
Special Purpose Banks - 0.7%
268,842 Dexia Belgium (Credit Communal) 36,805,779
482,533 Dexia France** 58,374,520
- --------------------------------------------------------------------------------
95,180,299
- --------------------------------------------------------------------------------
Telecommunication Equipment - 3.2%
1,231,100 Nokia Oyj (ADR) - Class A 82,329,813
3,203,776 Nokia Oyj - Class A 214,640,195
1,343,392 Telefonaktiebolaget L.M. Ericsson (ADR)
- Class B** 69,100,726
1,525,099 Telefonaktiebolaget L.M. Ericsson
- Class B** 80,405,126
- --------------------------------------------------------------------------------
446,475,860
- --------------------------------------------------------------------------------
Telephone - Integrated - 2.9%
24,386 Nippon Telegraph & Telephone Corp.** 214,090,328
930,300 Telecom Argentina Stet S.A. (ADR) 33,490,800
1,657,745 Telefonica de Argentina S.A. (ADR) 63,926,792
298,230 Telefonica de Espana 12,444,593
1,593,835 Telefonos de Mexico S.A. (ADR) 90,250,907
- --------------------------------------------------------------------------------
414,203,420
- --------------------------------------------------------------------------------
Telephone - Long Distance - 1.2%
1,007,020 AT&T Corp. 60,484,139
2,570,565 WorldCom, Inc.* 109,971,984
- --------------------------------------------------------------------------------
170,456,123
- --------------------------------------------------------------------------------
Tobacco - 0.2%
997,000 Tabacalera S.A. - Class A+ 21,455,629
- --------------------------------------------------------------------------------
Travel Services - 0.4%
10,692 Kuoni Reisen A.G. - Class B** 57,382,695
- --------------------------------------------------------------------------------
Total Common Stock (cost $10,049,973,384) 13,518,609,766
- --------------------------------------------------------------------------------
Preferred Stock - 0.8%
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 0.3%
15,282 Porsche A.G.** 38,236,999
- --------------------------------------------------------------------------------
Brewery - 0.1%
16,276,000 Companhia Cervejaria Brahma 10,599,142
- --------------------------------------------------------------------------------
Electric - Integrated - 0.1%
429,468,000 Companhia Energetica de Minas Gerais 20,834,858
181,500,000 Companhia Paranaense de Energia-Copel 2,538,419
- --------------------------------------------------------------------------------
23,373,277
- --------------------------------------------------------------------------------
Insurance Brokers - 0%
12,980 Marschollek, Lautenschlaeger
und Partner A.G.** 4,904,126
- --------------------------------------------------------------------------------
Oil Companies - Integrated - 0.1%
45,032,000 Petroleo Brasileiro S.A. 11,375,902
- --------------------------------------------------------------------------------
Telephone - Integrated - 0.2%
228,360 Telecomunicacoes Brasileiras S.A. (ADR) 27,817,103
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $105,612,357) 116,306,549
- --------------------------------------------------------------------------------
Rights - 0%
298,230 Telefonica de Espana* (cost $0) 230,890
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 0.4%
Household Finance Corp.
$ 61,700,000 5.51%, 5/1/98 (amortized cost $61,700,000) 61,700,000
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 43
<PAGE>
JANUS WORLDWIDE FUND April 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Time Deposit - 0.7%
First Union Bank North Carolina EDT
$ 100,000,000 5.50%, 5/1/98 (cost $100,000,000) $ 100,000,000
- --------------------------------------------------------------------------------
U.S. Government Agencies - 0.7%
Fannie Mae:
50,000,000 5.70%, 6/24/98 49,597,250
50,000,000 5.70%, 6/29/98 49,557,000
- --------------------------------------------------------------------------------
Total U.S. Government Agencies (cost $99,157,208) 99,154,250
- --------------------------------------------------------------------------------
Total Investments (total cost $10,416,442,949) - 98.9% 13,896,001,455
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 1.1% 151,906,700
- --------------------------------------------------------------------------------
Net Assets - 100% $14,047,908,155
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 44
<PAGE>
JANUS WORLDWIDE FUND April 30, 1998 (unaudited)
Summary of Investments by Country
April 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Argentina 1.1% $ 153,963,335
Austria 0.7% 94,096,677
Belgium 0.3% 36,805,779
Brazil 1.0% 137,183,841
Canada 0.2% 25,226,670
Denmark 1.7% 232,202,242
Finland 2.9% 401,007,094
France 7.8% 1,078,609,008
Germany 9.1% 1,257,712,336
Hong Kong 0.9% 128,088,594
Ireland 0.3% 43,240,553
Italy 3.4% 478,096,470
Japan 4.9% 684,606,949
Luxembourg 0.1% 6,960,337
Mexico 1.6% 220,214,910
Netherlands 9.0% 1,250,943,031
Norway 0.7% 97,692,367
South Africa 0.1% 18,829,362
Spain 1.0% 141,619,303
Sweden 7.0% 973,706,867
Switzerland 7.4% 1,027,341,215
United Kingdom 13.7% 1,909,077,887
United States++ 25.1% 3,498,776,628
- --------------------------------------------------------------------------------
Total 100.0% $13,896,001,455
================================================================================
++Includes Short-Term Securities (23.3% excluding Short-Term Securities)
Forward Currency Contracts
Open at April 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 8/7/98 210,000,000 $ 349,482,000 ($10,584,000)
British Pound 8/13/98 65,000,000 108,147,000 (3,107,000)
British Pound 10/7/98 65,000,000 107,893,500 (2,114,500)
Dutch Guilder 7/17/98 170,000,000 84,480,445 (767,469)
Dutch Guilder 7/23/98 60,000,000 29,827,003 (345,871)
Dutch Guilder 7/31/98 540,000,000 268,563,187 (2,355,673)
French Franc 7/23/98 497,635,000 83,049,900 (891,240)
French Franc 7/31/98 1,112,365,000 185,725,377 (1,723,930)
French Franc 8/7/98 200,000,000 33,405,154 (447,809)
French Franc 10/21/98 150,000,000 25,153,858 (243,535)
German Deutschemark 7/2/98 298,231,000 166,683,993 (2,515,241)
German Deutschemark 7/10/98 15,269,000 8,537,799 (101,888)
German Deutschemark 7/23/98 45,500,000 25,460,243 (127,724)
German Deutschemark 10/21/98 52,000,000 29,238,122 (279,652)
Japanese Yen 5/28/98 8,406,000,000 63,286,613 2,129,730
Japanese Yen 7/23/98 9,000,000,000 67,763,992 4,496,145
Japanese Yen 8/7/98 5,885,200,000 44,312,595 1,012,216
Japanese Yen 10/7/98 18,400,000,000 138,554,947 2,983,514
Japanese Yen 10/21/98 3,028,800,000 22,807,813 1,342,216
Japanese Yen 11/4/98 6,400,000,000 48,194,985 2,518,169
Japanese Yen 11/19/98 13,000,000,000 97,898,127 10,724,867
Swedish Krona 7/2/98 604,114,000 78,201,447 (3,146,997)
Swedish Krona 7/10/98 362,086,000 46,883,505 (1,566,109)
Swedish Krona 8/7/98 132,800,000 17,210,544 (569,774)
Swiss Franc 6/26/98 210,503,000 141,144,562 4,329,600
Swiss Franc 7/10/98 7,188,000 4,827,725 132,937
Swiss Franc 7/17/98 75,000,000 50,413,390 1,525,668
Swiss Franc 7/31/98 20,000,000 13,465,293 423,596
- --------------------------------------------------------------------------------
Total $2,340,613,119 $ 730,246
================================================================================
See Notes to Schedules of Investments.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 45
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS
For the six months ended Janus Janus Janus Janus Growth Janus
April 30, 1998, (unaudited) Janus Balanced Enterprise Equity Income and Income Mercury
(all numbers in thousands) Fund Fund Fund Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------------
Investment Income:
<S> <C> <C> <C> <C> <C> <C>
Interest $ 19,946 $ 4,879 $ 88 $ 209 $ 4,404 $ 2,033
Dividends 82,128 1,981 800 502 7,902 5,159
Foreign tax withheld (3,197) (71) (27) (10) (90) (194)
- --------------------------------------------------------------------------------------------------------------------------
98,877 6,789 861 701 12,216 6,998
- --------------------------------------------------------------------------------------------------------------------------
Expenses:
Advisory fees 65,164 1,572 2,005 387 7,280 6,542
Transfer agent fees and expenses 17,596 467 759 122 2,330 2,287
Registration fees 843 68 19 39 221 42
Postage and mailing expenses 610 19 16 13 83 70
Custodian fees 1,629 46 78 42 132 157
Printing expenses 1,015 19 50 15 187 111
Audit fees 18 8 4 6 14 5
Trustees' fees and expenses 76 2 3 1 8 8
Other expenses 140 8 -- 4 18 37
- --------------------------------------------------------------------------------------------------------------------------
Total Expenses 87,091 2,209 2,934 629 10,273 9,259
- --------------------------------------------------------------------------------------------------------------------------
Expense and Fee Offsets (2,372) (46) (60) (14) (235) (263)
- --------------------------------------------------------------------------------------------------------------------------
Net Expenses 84,719 2,163 2,874 615 10,038 8,996
- --------------------------------------------------------------------------------------------------------------------------
Net Investment Income/(Loss) 14,158 4,626 (2,013) 86 2,178 (1,998)
- --------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized
Gain/(Loss) on Investments:
Net realized gain/(loss) from
securities transactions 695,699 8,532 74,568 3,855 149,628 140,573
Net realized gain/(loss) from
foreign currency transactions (57,712) (682) (1,620) (121) 2,186 2,663
Net realized gain/(loss) from
futures contracts -- -- -- -- -- --
Change in net unrealized appreciation
or depreciation of investments 3,068,449 47,511 23,087 16,035 258,830 257,800
- --------------------------------------------------------------------------------------------------------------------------
Net Gain/(Loss) on Investments 3,706,436 55,361 96,035 19,769 410,644 401,036
- --------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in
Net Assets Resulting from Operations $3,720,594 $ 59,987 $ 94,022 $ 19,855 $ 412,822 $ 399,038
==========================================================================================================================
<CAPTION>
STATEMENTS OF OPERATIONS (continued)
Janus
For the six months ended Janus Janus Special Janus Janus Janus
April 30, 1998, (unaudited) Olympus Overseas Situations Twenty Venture Worldwide
(all numbers in thousands) Fund Fund Fund Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------------
Investment Income:
<S> <C> <C> <C> <C> <C> <C>
Interest $ 933 $ 6,573 $ 575 $ 24,336 $ 2,754 $ 11,162
Dividends 1,834 25,492 2,251 20,003 1,673 71,911
Foreign tax withheld (56) (3,384) (91) -- (31) (8,655)
- --------------------------------------------------------------------------------------------------------------------------
2,711 28,681 2,735 44,339 4,396 74,418
- --------------------------------------------------------------------------------------------------------------------------
Expenses:
Advisory fees 2,382 11,594 1,999 21,326 4,142 37,505
Transfer agent fees and expenses 733 3,339 638 6,783 1,204 10,615
Registration fees 74 151 243 388 58 (388)
Postage and mailing expenses 52 58 44 240 -- 134
Custodian fees 44 1,345 58 231 67 2,906
Printing expenses 48 123 85 341 129 480
Audit fees 15 20 5 14 10 21
Trustees' fees and expenses 4 9 2 23 5 55
Other expenses 13 101 11 54 29 157
Total Expenses 3,365 16,740 3,085 29,400 5,644 51,485
- --------------------------------------------------------------------------------------------------------------------------
Expense and Fee Offsets (118) (367) (77) (371) (102) (986)
- --------------------------------------------------------------------------------------------------------------------------
Net Expenses 3,247 16,373 3,008 29,029 5,542 50,499
- --------------------------------------------------------------------------------------------------------------------------
Net Investment Income/(Loss) (536) 12,308 (273) 15,310 (1,146) 23,919
- --------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized
Gain/(Loss) on Investments:
Net realized gain/(loss) from
securities transactions 31,314 (48,711) 21,548 203,226 67,493 (62,460)
Net realized gain/(loss) from
foreign currency transactions (1,442) 18,686 (1,526) (2,208) (251) 62,827
Net realized gain/(loss) from
futures contracts -- 693 -- -- -- 692
Change in net unrealized appreciation
or depreciation of investments 96,261 621,915 110,871 1,420,504 78,740 2,213,148
- --------------------------------------------------------------------------------------------------------------------------
Net Gain/(Loss) on Investments 126,133 592,583 130,893 1,621,522 145,982 2,214,207
- --------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in
Net Assets Resulting from Operations $ 125,597 $ 604,891 $ 130,620 $1,636,832 $ 144,836 $2,238,126
==========================================================================================================================
</TABLE>
An Explanation of the Statement of Operations
This financial statement details the Funds' income, expenses, 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 and expense offsets 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 Funds' portfolios. 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 Funds' portfolios 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.
<TABLE>
<CAPTION>
STATEMENTS OF ASSETS AND LIABILITIES
As of April 30, 1998, (unaudited) Janus Janus Janus Janus Growth Janus
(all numbers in thousands Janus Balanced Enterprise Equity Income and Income Mercury
except net asset value per share) Fund Fund Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------
Assets:
<S> <C> <C> <C> <C> <C> <C>
Investments at cost $15,447,034 $ 434,945 $ 433,607 $ 114,523 $ 2,061,149 $ 1,633,677
========================================================================================================================
Investments at value $21,901,605 $ 514,553 $ 590,609 $ 137,910 $ 2,708,122 $ 2,177,516
Cash 1,610 3,599 1,954 591 567 948
Receivables:
Investments sold 175,302 4,092 11,969 1,007 17,252 52,401
Fund shares sold 23,743 2,381 7,142 558 6,631 17,998
Dividends 19,719 607 193 183 1,438 525
Interest 20 2,101 -- 110 111 --
Other assets 132 1 3 -- -- --
Forward currency contracts -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------
Total Assets 22,122,131 527,334 611,870 140,359 2,734,121 2,249,388
- ------------------------------------------------------------------------------------------------------------------------
Liabilities:
Payables:
Due to custodian -- -- -- -- -- --
Investments purchased 41,069 36 19,971 213 56,695 47,636
Fund shares repurchased 14,784 2,089 975 47 1,176 1,312
Advisory fees 11,744 306 342 83 1,430 1,174
Transfer agent fees and expenses 2,948 93 127 25 395 339
Accrued expenses 2,280 112 139 49 436 340
Forward currency contracts 1,639 -- 400 -- 1,568 1,298
- ------------------------------------------------------------------------------------------------------------------------
Total Liabilities 74,464 2,636 21,954 417 61,700 52,099
- ------------------------------------------------------------------------------------------------------------------------
Net Assets $22,047,667 $ 524,698 $ 589,916 $ 139,942 $ 2,672,421 $ 2,197,289
Shares Outstanding, $0.01 Par Value
(unlimited shares authorized) 754,092 30,563 17,257 8,909 98,473 107,909
========================================================================================================================
Net Asset Value Per Share $ 29.24 $ 17.17 $ 34.18 $ 15.71 $ 27.14 $ 20.36
========================================================================================================================
<CAPTION>
STATEMENTS OF ASSETS AND LIABILITIES (continued)
Janus
As of April 30, 1998, (unaudited) Janus Janus Special Janus Janus Janus
(all numbers in thousands Olympus Overseas Situations Twenty Venture Worldwide
except net asset value per share) Fund Fund Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------
Assets:
<S> <C> <C> <C> <C> <C> <C>
Investments at cost $ 561,119 $ 3,403,600 $ 764,881 $ 5,434,450 $ 859,200 $10,416,443
========================================================================================================================
Investments at value $ 774,847 $ 4,319,569 $ 910,117 $ 8,006,833 $ 1,228,589 $13,896,001
Cash 532 1,693 -- 5,322 5,103 1,561
Receivables:
Investments sold 29,050 31,050 19,944 54,144 24,458 70,766
Fund shares sold 8,509 30,683 5,750 30,415 3,711 135,527
Dividends 445 14,036 1,004 2,939 155 38,171
Interest -- 6 -- 6,908 -- 15
Other assets -- 24 -- 46 16 --
Forward currency contracts -- 1,344 -- -- -- 730
- ------------------------------------------------------------------------------------------------------------------------
Total Assets 813,383 4,398,405 936,815 8,106,607 1,262,032 14,142,771
- ------------------------------------------------------------------------------------------------------------------------
Liabilities:
Payables:
Due to custodian -- -- 5,028 -- -- --
Investments purchased 11,073 46,591 8,896 15,929 17,860 52,325
Fund shares repurchased 443 1,614 996 3,486 1,203 32,319
Advisory fees 451 2,313 500 4,173 703 7,367
Transfer agent fees and expenses 115 635 143 1,334 229 1,928
Accrued expenses 144 606 287 1,041 204 924
Forward currency contracts 285 -- 1,072 2,421 -- --
- ------------------------------------------------------------------------------------------------------------------------
Total Liabilities 12,511 51,759 16,922 28,384 20,199 94,863
- ------------------------------------------------------------------------------------------------------------------------
Net Assets $ 800,872 $ 4,346,646 $ 919,893 $ 8,078,223 $ 1,241,833 $14,047,908
Shares Outstanding, $0.01 Par Value
(unlimited shares authorized) 38,038 213,261 55,365 208,188 22,353 312,425
========================================================================================================================
Net Asset Value Per Share $ 21.05 $ 20.38 $ 16.62 $ 38.80 $ 55.56 $ 44.96
========================================================================================================================
</TABLE>
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 funds' net assets (assets minus liabilities) by the number of shares
outstanding.
See Notes to Financial Statements.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 46 and 47
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
For the six months ended April 30, 1998,
(unaudited) and the fiscal year or Janus Janus
period ended October 31, 1997 Janus Balanced Enterprise
(all numbers in thousands) Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997
- --------------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) $ 14,158 $ 149,574 $ 4,626 $ 7,455 ($ 2,013) ($ 3,766)
Net realized gain/(loss) from
investment transactions 637,987 3,110,339 7,850 34,483 72,948 33,040
Change in unrealized net appreciation
or depreciation of investments 3,068,449 495,474 47,511 17,621 23,087 (21,277)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations 3,720,594 3,755,387 59,987 59,559 94,022 7,997
- --------------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders:
Net investment income* (149,576) (120,830) (5,089) (6,418) -- --
Net realized gain from
investment transactions* (3,061,874) (1,689,077) (34,067) (19,020) (34,479) (30,151)
- --------------------------------------------------------------------------------------------------------------------------------
Net Decrease from Dividends and Distributions (3,211,450) (1,809,907) (39,156) (25,438) (34,479) (30,151)
- --------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold 1,521,437 3,064,802 182,562 218,600 253,575 407,412
Reinvested dividends and distributions 3,124,552 1,766,166 38,310 24,763 33,924 29,668
Shares repurchased (2,136,800) (3,060,294) (77,164) (124,369) (308,954) (595,101)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease)
from Capital Share Transactions 2,509,189 1,770,674 143,708 118,994 (21,455) (158,021)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 3,018,333 3,716,154 164,539 153,115 38,088 (180,175)
Net Assets:
Beginning of period 19,029,334 15,313,180 360,159 207,044 551,828 732,003
- --------------------------------------------------------------------------------------------------------------------------------
End of period $22,047,667 $19,029,334 $ 524,698 $ 360,159 $ 589,916 $ 551,828
================================================================================================================================
Net Assets Consist of:
Capital(par value and paid-in surplus)* $14,888,925 $12,379,736 $ 434,808 $ 291,100 $ 361,498 $ 382,952
Undistributed net investment income/(loss)* 25,097 160,515 1,943 2,406 (2,012) --
Undistributed net realized
gain/(loss) from investments* 680,522 3,104,409 8,336 34,553 73,835 35,367
Unrealized appreciation of
investments and foreign currency 6,453,123 3,384,674 79,611 32,100 156,595 133,509
- --------------------------------------------------------------------------------------------------------------------------------
$22,047,667 $19,029,334 $ 524,698 $ 360,159 $ 589,916 $ 551,828
================================================================================================================================
Transactions in Fund Shares:
Shares sold 55,155 114,499 11,201 14,343 8,007 13,843
Reinvested distributions 128,582 71,795 2,532 1,721 1,155 1,027
- --------------------------------------------------------------------------------------------------------------------------------
Total 183,737 186,294 13,733 16,064 9,162 14,870
- --------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased (77,796) (112,847) (4,700) (8,152) (9,786) (20,455)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Fund Shares 105,941 73,447 9,033 7,912 (624) (5,585)
- --------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 648,151 574,704 21,530 13,618 17,881 23,466
- --------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 754,092 648,151 30,563 21,530 17,257 17,881
================================================================================================================================
Purchases and Sales of
Investment Securities:
(excluding short-term securities)
Purchases of securities $ 7,994,681 $23,008,189 $ 304,395 $ 411,623 $ 348,668 $ 654,058
Proceeds from sales of securities 9,011,078 20,176,583 192,395 334,092 416,122 835,021
Purchases of long-term
U.S. government obligations -- -- 4,058 63,848 -- --
Proceeds from sales of long-term
U.S. government obligations -- -- 5,180 45,558 -- --
================================================================================================================================
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
For the six months ended April 30, 1998,
(unaudited) and the fiscal year or Janus Janus Janus
period ended October 31, 1997 Equity Income Growth and Income Mercury
(all numbers in thousands) Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997
- --------------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) $ 86 $ 287 $ 2,178 $ 4,229 ($ 1,998) $ 4,299
Net realized gain/(loss) from
investment transactions 3,734 5,252 151,814 185,980 143,236 198,605
Change in unrealized net appreciation
or depreciation of investments 16,035 6,343 258,830 241,318 257,800 116,617
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations 19,855 11,882 412,822 431,527 399,038 319,521
- --------------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders:
Net investment income* (126) (393) (2,030) (6,298) (4,295) (8,225)
Net realized gain from
investment transactions* (5,097) (992) (184,658) (97,951) (196,658) (250,204)
- --------------------------------------------------------------------------------------------------------------------------------
Net Decrease from Dividends and Distributions (5,223) (1,385) (186,688) (104,249) (200,953) (258,429)
- --------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold 112,898 81,250 696,845 906,848 741,316 1,157,958
Reinvested dividends and distributions 5,284 1,306 182,898 101,813 196,626 252,800
Shares repurchased (67,197) (49,157) (322,455) (480,123) (909,787) (1,503,151)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease)
from Capital Share Transactions 50,985 33,399 557,288 528,538 28,155 (92,393)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 65,617 43,896 783,422 855,816 226,240 (31,301)
Net Assets:
Beginning of period 74,325 30,429 1,888,999 1,033,183 1,971,049 2,002,350
- --------------------------------------------------------------------------------------------------------------------------------
End of period $ 139,942 $ 74,325 $ 2,672,421 $ 1,888,999 $ 2,197,289 $ 1,971,049
================================================================================================================================
Net Assets Consist of:
Capital(par value and paid-in surplus)* $ 112,707 $ 61,722 $ 1,875,200 $ 1,317,911 $ 1,516,169 $ 1,488,013
Undistributed net investment income/(loss)* 46 87 970 823 (781) 5,512
Undistributed net realized
gain/(loss) from investments* 3,801 5,163 150,850 183,694 139,365 192,788
Unrealized appreciation of
investments and foreign currency 23,388 7,353 645,401 386,571 542,536 284,736
- --------------------------------------------------------------------------------------------------------------------------------
$ 139,942 $ 74,325 $ 2,672,421 $ 1,888,999 $ 2,197,289 $ 1,971,049
================================================================================================================================
Transactions in Fund Shares:
Shares sold 7,915 6,443 28,068 40,425 40,666 65,228
Reinvested distributions 401 115 8,047 5,245 12,167 15,284
- --------------------------------------------------------------------------------------------------------------------------------
Total 8,316 6,558 36,115 45,670 52,833 80,512
- --------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased (4,724) (3,936) (12,984) (21,857) (50,598) (84,844)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Fund Shares 3,592 2,622 23,131 23,813 2,235 (4,332)
- --------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 5,317 2,695 75,342 51,529 105,674 110,006
- --------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 8,909 5,317 98,473 75,342 107,909 105,674
================================================================================================================================
Purchases and Sales of
Investment Securities:
(excluding short-term securities)
Purchases of securities $ 109,537 $ 108,410 $ 1,342,032 $ 2,032,309 $ 1,202,245 $ 2,839,050
Proceeds from sales of securities 66,998 79,110 930,830 1,711,207 1,378,035 2,999,417
Purchases of long-term
U.S. government obligations -- 1,000 -- -- -- --
Proceeds from sales of long-term
U.S. government obligations -- 1,007 -- -- -- --
================================================================================================================================
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
For the six months ended April 30, 1998,
(unaudited) and the fiscal year or Janus Janus Janus
period ended October 31, 1997 Olympus Overseas Special Situations
(all numbers in thousands) Fund Fund Fund
- --------------------------------------------------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997(1)
- --------------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) ($ 536) $ 1,357 $ 12,308 $ 16,993 ($ 273) ($ 109)
Net realized gain/(loss) from
investment transactions 29,872 32,619 (29,332) 86,037 20,022 18,106
Change in unrealized net appreciation
or depreciation of investments 96,261 82,685 621,915 231,923 110,871 33,300
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations 125,597 116,661 604,891 334,953 130,620 51,297
- --------------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders:
Net investment income* (1,358) (3,648) (16,883) (2,552) -- --
Net realized gain from
investment transactions* (24,153) -- (88,408) (15,609) (16,943) --
- --------------------------------------------------------------------------------------------------------------------------------
Net Decrease from Dividends and Distributions (25,511) (3,648) (105,291) (18,161) (16,943) --
- --------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold 242,214 529,820 2,742,455 4,520,982 610,880 389,647
Reinvested dividends and distributions 25,145 3,545 102,321 17,781 16,475 --
Shares repurchased (182,224) (463,102) (2,202,927) (2,422,988) (154,916) (107,167)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease)
from Capital Share Transactions 85,135 70,263 641,849 2,115,775 472,439 282,480
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 185,221 183,276 1,141,449 2,432,567 586,116 333,777
Net Assets:
Beginning of period 615,651 432,375 3,205,197 772,630 333,777 --
- --------------------------------------------------------------------------------------------------------------------------------
End of period $ 800,872 $ 615,651 $ 4,346,646 $ 3,205,197 $ 919,893 $ 333,777
================================================================================================================================
Net Assets Consist of:
Capital(par value and paid-in surplus)* $ 558,836 $ 473,702 $ 3,449,554 $ 2,807,706 $ 754,919 $ 282,480
Undistributed net investment income/(loss)* (627) 1,267 14,971 19,546 (273) --
Undistributed net realized
gain/(loss) from investments* 29,217 23,497 (35,173) 82,566 21,076 17,997
Unrealized appreciation of
investments and foreign currency 213,446 117,185 917,294 295,379 144,171 33,300
- --------------------------------------------------------------------------------------------------------------------------------
$ 800,872 $ 615,651 $ 4,346,646 $ 3,205,197 $ 919,893 $ 333,777
================================================================================================================================
Transactions in Fund Shares:
Shares sold 12,761 33,016 149,474 262,026 40,750 32,037
Reinvested distributions 1,469 242 5,911 1,181 1,217 --
- --------------------------------------------------------------------------------------------------------------------------------
Total 14,230 33,258 155,385 263,207 41,967 32,037
- --------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased (9,633) (28,918) (120,823) (136,692) (10,306) (8,333)
- --------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Fund Shares 4,597 4,340 34,562 126,515 31,661 23,704
- --------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 33,441 29,101 178,699 52,184 23,704 --
- --------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 38,038 33,441 213,261 178,699 55,365 23,704
================================================================================================================================
Purchases and Sales of
Investment Securities:
(excluding short-term securities)
Purchases of securities $ 572,081 $ 1,202,420 $ 2,243,997 $ 3,322,515 $ 729,664 $ 488,802
Proceeds from sales of securities 507,240 1,107,630 1,399,514 1,331,836 275,134 217,384
Purchases of long-term
U.S. government obligations -- -- -- -- -- --
Proceeds from sales of long-term
U.S. government obligations -- -- -- -- -- --
================================================================================================================================
</TABLE>
(1) Period from December 31, 1996, (inception) to October 31, 1997
*See Note 3 in Notes to Financial Statements.
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 because of the funds' investment
performance. The funds' net assets may 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 fund's "Net decrease from dividends and distributions" to the
"Reinvested dividends and distributions," you'll notice that dividend
distributions had little effect on each fund's 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 fund's 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. Because funds must distribute substantially all earnings,
you'll notice that a significant portion of net assets is shareholder capital.
See Notes to Financial Statements.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 48 and 49
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
For the six months ended April 30, 1998,
(unaudited) and the fiscal year or Janus Janus Janus
period ended October 31, 1997 Twenty Venture Worldwide
(all numbers in thousands) Fund Fund Fund
- ----------------------------------------------------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997
- ----------------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) $ 15,310 $ 16,587 ($ 1,146) $ 1,510 $ 23,919 $ 50,795
Net realized gain from
investment transactions 201,018 755,954 67,242 195,359 1,059 655,178
Change in unrealized net appreciation
or depreciation of investments 1,420,504 546,527 78,740 (52,099) 2,213,148 690,790
- ----------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations 1,636,832 1,319,068 144,836 144,770 2,238,126 1,396,763
- ----------------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders:
Net investment income* (16,587) (22,661) (1,510) -- (50,801) (21,409)
Net realized gain from
investment transactions* (752,041) (663,308) (193,032) (155,029) (672,990) (285,338)
- ----------------------------------------------------------------------------------------------------------------------------------
Net Decrease from Dividends and Distributions (768,628) (685,969) (194,542) (155,029) (723,791) (306,747)
- ----------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold 1,353,529 2,010,346 103,112 179,080 4,302,492 7,204,484
Reinvested dividends and distributions 754,320 653,113 188,540 150,172 703,565 299,515
Shares repurchased (768,900) (1,362,932) (252,454) (807,968) (2,830,709) (2,702,975)
- ----------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease)
from Capital Share Transactions 1,338,949 1,300,527 39,198 (478,716) 2,175,348 4,801,024
- ----------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 2,207,153 1,933,626 (10,508) (488,975) 3,689,683 5,891,040
Net Assets:
Beginning of period 5,871,070 3,937,444 1,252,341 1,741,316 10,358,225 4,467,185
- ----------------------------------------------------------------------------------------------------------------------------------
End of period $ 8,078,223 $ 5,871,070 $ 1,241,833 $ 1,252,341 $14,047,908 $10,358,225
==================================================================================================================================
Net Assets Consist of:
Capital(par value and paid-in surplus)* $ 5,289,542 $ 3,950,593 $ 805,914 $ 766,715 $10,567,291 $ 8,391,943
Undistributed net investment income* 15,291 16,568 776 3,432 42,163 69,045
Undistributed net realized
gain/(loss) from investments* 203,428 754,451 65,754 191,545 (41,790) 630,141
Unrealized appreciation of
investments and foreign currency 2,569,962 1,149,458 369,389 290,649 3,480,244 1,267,096
- ----------------------------------------------------------------------------------------------------------------------------------
$ 8,078,223 $ 5,871,070 $ 1,241,833 $ 1,252,341 $14,047,908 $10,358,225
==================================================================================================================================
Transactions in Fund Shares:
Shares sold 38,824 62,858 1,958 3,277 104,809 190,176
Reinvested distributions 24,756 23,127 3,903 2,884 18,742 8,941
Total 63,580 85,985 5,861 6,161 123,551 199,117
- ----------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased (22,393) (42,422) (4,792) (15,340) (69,771) (69,584)
- ----------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Fund Shares 41,187 43,563 1,069 (9,179) 53,780 129,533
- ----------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 167,001 123,438 21,284 30,463 258,645 129,112
- ----------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 208,188 167,001 22,353 21,284 312,425 258,645
==================================================================================================================================
Purchases and Sales of
Investment Securities:
(excluding short-term securities)
Purchases of securities $ 2,408,029 $ 5,967,189 $ 624,911 $ 1,754,415 $ 5,395,380 $10,485,393
Proceeds from sales of securities 1,907,897 5,818,841 786,449 2,388,474 3,660,205 5,673,413
Purchases of long-term
U.S. government obligations 388,670 -- -- -- -- --
Proceeds from sales of long-term
U.S. government obligations 188,367 -- -- -- -- --
==================================================================================================================================
</TABLE>
*See Note 3 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 50
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
or through each fiscal year Janus Fund
or period ended October 31 1998 1997 1996 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 29.36 $ 26.65 $ 23.37 $ 19.62 $ 20.81 $ 18.86
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .02 .15 .31 .16 .17 .26
Net gains or (losses) on securities
(both realized and unrealized) 4.84 5.69 4.23 3.99 (.03) 2.88
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 4.86 5.84 4.54 4.15 .14 3.14
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.23) (.21) (.13) (.01) (.39) (.29)
Distributions (from capital gains) (4.75) (2.92) (1.13) (.39) (.94) (.90)
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (4.98) (3.13) (1.26) (.40) (1.33) (1.19)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 29.24 $ 29.36 $ 26.65 $ 23.37 $ 19.62 $ 20.81
================================================================================================================================
Total Return* 20.01% 24.18% 20.31% 21.62% 0.75% 17.41%
================================================================================================================================
Net Assets, End of Period (in thousands) $22,047,667 $19,029,334 $15,313,180 $11,962,970 $ 9,647,245 $ 9,098,000
Average Net Assets for the Period
(in thousands) $20,161,342 $17,515,216 $13,753,157 $10,559,806 $ 9,338,807 $ 7,335,871
Ratio of Gross Expenses to
Average Net Assets**(1) 0.87% 0.87% 0.86% 0.87% NA NA
Ratio of Net Expenses to
Average Net Assets**(1) 0.85% 0.86% 0.85% 0.86% 0.91% 0.92%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** 0.14% 0.85% 0.91% 1.25% 1.12% 1.55%
Portfolio Turnover Rate** 83% 132% 104% 118% 139% 127%
Average Commission Per Share $ .0506 $ .0500 $ .0558 NA NA NA
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
or through each fiscal year Janus Balanced Fund
or period ended October 31 1998 1997 1996 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 16.73 $ 15.20 $ 13.72 $ 12.17 $ 12.23 $ 10.64
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .15 .36 .33 .61 .27 .19
Net gains or (losses) on securities
(both realized and unrealized) 1.98 2.88 2.22 1.52 (.09) 1.56
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 2.13 3.24 2.55 2.13 .18 1.75
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.20) (.36) (.26) (.58) (.24) (.16)
Distributions (from capital gains) (1.49) (1.35) (.81) -- -- --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (1.69) (1.71) (1.07) (.58) (.24) (.16)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 17.17 $ 16.73 $ 15.20 $ 13.72 $ 12.17 $ 12.23
================================================================================================================================
Total Return* 14.00% 23.38% 19.39% 18.26% 1.51% 16.54%
================================================================================================================================
Net Assets, End of Period (in thousands) $ 524,698 $ 360,159 $ 207,044 $ 124,545 $ 93,546 $ 72,547
Average Net Assets for the Period
(in thousands) $ 431,511 $ 283,220 $ 158,607 $ 107,259 $ 86,361 $ 43,522
Ratio of Gross Expenses to
Average Net Assets**(1) 1.03% 1.12% 1.23% 1.35% NA NA
Ratio of Net Expenses to
Average Net Assets**(1) 1.01% 1.10% 1.21% 1.32% 1.42% 1.70%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** 2.16% 2.63% 2.35% 2.52% 2.28% 2.15%
Portfolio Turnover Rate** 95% 139% 151% 185% 167% 131%
Average Commission Per Share $ .0469 $ .0468 $ .0428 NA NA NA
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
or through each fiscal year Janus Enterprise Fund
or period ended October 31 1998 1997 1996 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 30.86 $ 31.19 $ 27.14 $ 24.43 $ 21.87 $ 17.09
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) (.12) -- -- .52 (.06) .04
Net gains or (losses) on securities
(both realized and unrealized) 5.40 .95 5.85 3.09 3.18 4.76
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 5.28 .95 5.85 3.61 3.12 4.80
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) -- -- -- (.52) (.02) (.02)
Distributions (from capital gains) (1.96) (1.28) (1.80) (.38) (.54) --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (1.96) (1.28) (1.80) (.90) (.56) (.02)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 34.18 $ 30.86 $ 31.19 $ 27.14 $ 24.43 $ 21.87
================================================================================================================================
Total Return* 18.15% 3.31% 22.43% 15.46% 14.56% 28.09%
================================================================================================================================
Net Assets, End of Period (in thousands) $ 589,916 $ 551,828 $ 732,003 $ 459,370 $ 370,028 $ 239,334
Average Net Assets for the Period
(in thousands) $ 560,456 $ 613,784 $ 596,313 $ 407,791 $ 269,595 $ 188,345
Ratio of Gross Expenses to
Average Net Assets**(1) 1.06% 1.07% 1.14% 1.26% NA NA
Ratio of Net Expenses to
Average Net Assets**(1) 1.03% 1.04% 1.12% 1.23% 1.25% 1.36%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** (0.72%) (0.61%) (0.78%) 0.02% (0.32%) 0.14%
Portfolio Turnover Rate** 127% 111% 93% 194% 193% 201%
Average Commission Per Share $ .0351 $ .0360 $ .0333 NA NA NA
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) See "Explanation of the Financial Highlights."
*Total return not annualized for periods of less than one full year
**Annualized for periods of less than one full year
NA - Disclosure not applicable to prior periods
See Notes to Financial Statements.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 51
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
or through each fiscal year or Janus Growth and Income Fund
period ended October 31 1998 1997 1996 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 25.07 $ 20.05 $ 18.13 $ 14.69 $ 15.24 $ 12.95
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .02 .01 .16 .11 .19 .14
Net gains or (losses) on securities
(both realized and unrealized) 4.45 6.98 4.01 3.43 (.31) 2.29
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 4.47 6.99 4.17 3.54 (.12) 2.43
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.02) (.11) (.08) (.10) (.10) (.14)
Distributions (from capital gains) (2.38) (1.86) (2.17) -- (.33) --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (2.40) (1.97) (2.25) (.10) (.43) (.14)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 27.14 $ 25.07 $ 20.05 $ 18.13 $ 14.69 $ 15.24
================================================================================================================================
Total Return* 19.66% 37.78% 25.56% 24.20% (0.76%) 18.81%
================================================================================================================================
Net Assets, End of Period (in thousands) $ 2,672,421 $ 1,888,999 $ 1,033,183 $ 582,963 $ 489,942 $ 518,963
Average Net Assets for the Period
(in thousands) $ 2,197,014 $ 1,415,563 $ 773,343 $ 498,442 $ 499,831 $ 404,285
Ratio of Gross Expenses to
Average Net Assets**(3) 0.94% 0.98% 1.05% 1.19% NA NA
Ratio of Net Expenses to
Average Net Assets**(3) 0.92% 0.96% 1.03% 1.17% 1.22% 1.28%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** 0.20% 0.30% 0.70% 1.11% 1.26% 1.13%
Portfolio Turnover Rate** 91% 127% 153% 195% 123% 138%
Average Commission Per Share $ .0449 $ .0588 $ .0520 NA NA NA
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
or through each fiscal year or Janus Mercury Fund
period ended October 31 1998 1997 1996 1995 1994 1993(1)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 18.65 $ 18.20 $ 17.38 $ 14.12 $ 11.70 $ 10.00
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) (.02) (.01) .14 .16 .02 (.01)
Net gains or (losses) on securities
(both realized and unrealized) 3.67 2.82 2.74 3.37 2.40 1.71
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 3.65 2.81 2.88 3.53 2.42 1.70
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.04) (.08) -- (.16) -- --
Distributions (from capital gains) (1.90) (2.28) (2.06) (.11) -- --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (1.94) (2.36) (2.06) (.27) -- --
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 20.36 $ 18.65 $ 18.20 $ 17.38 $ 14.12 $ 11.70
================================================================================================================================
Total Return* 22.29% 17.07% 18.18% 25.53% 20.68% 17.00%
================================================================================================================================
Net Assets, End of Period (in thousands) $ 2,197,289 $ 1,971,049 $ 2,002,350 $ 1,520,768 $ 596,330 $ 112,725
Average Net Assets for the Period
(in thousands) $ 1,968,596 $ 2,045,901 $ 1,838,593 $ 1,116,377 $ 257,726 $ 67,462
Ratio of Gross Expenses to
Average Net Assets**(3) 0.95% 0.98% 1.02% 1.14% NA NA
Ratio of Net Expenses to
Average Net Assets**(3) 0.92% 0.96% 1.00% 1.12% 1.33% 1.75%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** (0.20%) 0.21% 0.45% 0.50% 0.25% (0.40%)
Portfolio Turnover Rate** 127% 157% 177% 201% 283% 151%
Average Commission Per Share $ .0392 $ .0441 $ .0383 NA NA NA
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
or through each fiscal year or Janus Overseas Fund
period ended October 31 1998 1997 1996 1995 1994(2)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 17.94 $ 14.81 $ 11.58 $ 10.36 $ 10.00
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .06 .04 .10 .12 (.02)
Net gains or (losses) on securities
(both realized and unrealized) 2.98 3.39 3.34 1.10 .38
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 3.04 3.43 3.44 1.22 .36
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.10) (.04) (.11) -- --
Distributions (from capital gains) (.50) (.26) (.10) -- --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.60) (.30) (.21) -- --
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 20.38 $ 17.94 $ 14.81 $ 11.58 $ 10.36
================================================================================================================================
Total Return* 17.55% 23.56% 30.19% 11.78% 3.60%
================================================================================================================================
Net Assets, End of Period (in thousands) $ 4,346,646 $ 3,205,197 $ 772,630 $ 110,866 $ 64,065
Average Net Assets for the Period
(in thousands) $ 3,537,361 $ 2,093,370 $ 335,098 $ 77,668 $ 36,645
Ratio of Gross Expenses to
Average Net Assets**(3) 0.95% 1.03% 1.26% 1.76% NA
Ratio of Net Expenses to
Average Net Assets**(3) 0.93% 1.01% 1.23% 1.73% 2.16%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** 0.70% 0.81% 0.73% 0.36% (0.64%)
Portfolio Turnover Rate** 85% 72% 71% 188% 181%
Average Commission Per Share $ .0282 $ .0329 $ .0234 NA NA
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Fiscal period from May 3, 1993, (inception) to October 31, 1993
(2) Fiscal period from May 2, 1994, (inception) to October 31, 1994
(3) See "Explanation of the Financial Highlights."
*Total return not annualized for periods of less than one full year
**Annualized for periods of less than one full year
NA - Disclosure not applicable to prior periods
See Notes to Financial Statements.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 52
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
each fiscal year or period Janus Twenty Fund
ended October 31 1998 1997 1996 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 35.16 $ 31.90 $ 30.12 $ 24.24 $ 25.85 $ 22.75
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .07 (.09) .37 .01 .16 .17
Net gains or (losses) on securities
(both realized and unrealized) 8.13 8.85 6.68 5.94 (1.07) 3.31
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 8.20 8.76 7.05 5.95 (.91) 3.48
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.10) (.18) -- (.07) (.25) (.18)
Distributions (from capital gains) (4.46) (5.32) (5.27) -- (.45) (.20)
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (4.56) (5.50) (5.27) (.07) (.70) (.38)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 38.80 $ 35.16 $ 31.90 $ 30.12 $ 24.24 $ 25.85
================================================================================================================================
Total Return* 26.90% 31.65% 27.59% 24.67% (3.52%) 15.39%
================================================================================================================================
Net Assets, End of Period (in thousands) $ 8,078,223 $ 5,871,070 $ 3,937,444 $ 2,995,751 $ 2,742,812 $ 3,748,796
Average Net Assets for the Period
(in thousands) $ 6,557,379 $ 4,989,616 $ 3,385,561 $ 2,716,278 $ 3,051,194 $ 3,545,727
Ratio of Gross Expenses to
Average Net Assets**(1) 0.90% 0.93% 0.93% 1.00% NA NA
Ratio of Net Expenses to
Average Net Assets**(1) 0.89% 0.91% 0.92% 0.99% 1.02% 1.05%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** 0.47% 0.33% 0.67% 0.62% 0.57% 0.87%
Portfolio Turnover Rate** 70% 123% 137% 147% 102% 99%
Average Commission Per Share $ .0615 $ .0567 $ .0571 NA NA NA
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
or through each fiscal year Janus Venture Fund
or period ended October 31 1998 1997 1996 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 58.84 $ 57.16 $ 59.53 $ 52.86 $ 53.25 $ 47.74
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .04 .16 -- .05 .11 .66
Net gains or (losses) on securities
(both realized and unrealized) 6.04 6.80 5.09 9.49 4.40 6.72
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 6.08 6.96 5.09 9.54 4.51 7.38
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.07) -- (.01) (.03) (.53) (1.16)
Distributions (from capital gains) (9.29) (5.28) (7.45) (2.84) (4.37) (.71)
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (9.36) (5.28) (7.46) (2.87) (4.90) (1.87)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 55.56 $ 58.84 $ 57.16 $ 59.53 $ 52.86 $ 53.25
================================================================================================================================
Total Return* 12.61% 13.38% 9.28% 19.24% 9.23% 15.76%
================================================================================================================================
Net Assets, End of Period (in thousands) $ 1,241,833 $ 1,252,341 $ 1,741,316 $ 1,753,201 $ 1,550,476 $ 1,836,657
Average Net Assets for the Period
(in thousands) $ 1,223,556 $ 1,379,145 $ 1,822,801 $ 1,612,514 $ 1,562,521 $ 1,792,532
Ratio of Gross Expenses to
Average Net Assets**(1) 0.93% 0.94% 0.89% 0.92% NA NA
Ratio of Net Expenses to
Average Net Assets**(1) 0.91% 0.92% 0.88% 0.91% 0.96% 0.97%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** (0.19%) 0.11% (0.33%) 0.29% 0.27% 1.29%
Portfolio Turnover Rate** 110% 146% 136% 113% 114% 139%
Average Commission Per Share $ .0390 $ .0391 $ .0382 NA NA NA
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the six
months ended April 30, 1998, (unaudited)
or through each fiscal year Janus Worldwide Fund
or period ended October 31 1998 1997 1996 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 40.05 $ 34.60 $ 27.65 $ 27.00 $ 24.16 $ 18.95
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .06 (.08) .49 .81 .15 .14
Net gains or (losses) on securities
(both realized and unrealized) 7.64 7.73 7.79 1.39 3.34 5.29
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 7.70 7.65 8.28 2.20 3.49 5.43
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.20) (.15) (.26) (.54) (.27) (.22)
Distributions (from capital gains) (2.59) (2.05) (1.07) (1.01) (.38) --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (2.79) (2.20) (1.33) (1.55) (.65) (.22)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 44.96 $ 40.05 $ 34.60 $ 27.65 $ 27.00 $ 24.16
================================================================================================================================
Total Return* 20.61% 23.34% 31.00% 8.89% 14.76% 28.79%
================================================================================================================================
Net Assets, End of Period (in thousands) $14,047,908 $10,358,225 $ 4,467,185 $ 1,804,354 $ 1,587,120 $ 754,608
Average Net Assets for the Period
(in thousands) $11,579,877 $ 7,783,669 $ 2,953,495 $ 1,622,142 $ 1,244,194 $ 379,259
Ratio of Gross Expenses to
Average Net Assets**(1) 0.90% 0.97% 1.02% 1.24% NA NA
Ratio of Net Expenses to
Average Net Assets**(1) 0.88% 0.95% 1.01% 1.23% 1.12% 1.32%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** 0.42% 0.65% 0.73% 0.99% 0.42% 0.92%
Portfolio Turnover Rate** 66% 79% 80% 142% 158% 124%
Average Commission Per Share $ .0434 $ .0561 $ .0311 NA NA NA
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) See "Explanation of the Financial Highlights."
*Total return not annualized for periods of less than one full year
**Annualized for periods of less than one full year
NA - Disclosure not applicable to prior periods
See Notes to Financial Statements.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 53
<PAGE>
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
For a share outstanding during the six Janus Janus
months ended April 30, 1998, (unaudited) Equity Income Olympus
or through each fiscal year Fund Fund
or period ended October 31 1998 1997 1996(1) 1998 1997 1996(2)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 13.98 $ 11.29 $ 10.00 $ 18.41 $ 14.86 $ 12.00
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .01 .09 .07 (.01) .04 .13
Net gains or (losses) on securities
(both realized and unrealized) 2.62 3.11 1.25 3.40 3.64 2.73
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 2.63 3.20 1.32 3.39 3.68 2.86
- --------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.02) (.12) (.03) (.04) (.13) --
Distributions (from capital gains) (.88) (.39) -- (.71) -- --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.90) (.51) (.03) (.75) (.13) --
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 15.71 $ 13.98 $ 11.29 $ 21.05 $ 18.41 $ 14.86
================================================================================================================================
Total Return* 19.90% 29.46% 13.20% 19.35% 24.98% 23.83%
================================================================================================================================
Net Assets, End of Period (in thousands) $ 139,942 $ 74,325 $ 30,429 $ 800,872 $ 615,651 $ 432,375
Average Net Assets for the Period
(in thousands) $ 104,185 $ 46,054 $ 21,424 $ 677,454 $ 517,424 $ 276,006
Ratio of Gross Expenses to
Average Net Assets**(4) 1.22% 1.48% 1.79% 1.00% 1.06% 1.17%
Ratio of Net Expenses to
Average Net Assets**(4) 1.19% 1.45% 1.71% 0.97% 1.03% 1.15%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** 0.17% 0.62% 3.09% (0.16%) 0.26% 1.64%
Portfolio Turnover Rate** 136% 180% 325% 156% 244% 303%
Average Commission Per Share $ .0450 $ .0437 $ .0350 $ .0444 $ .0496 $ .0336
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Janus
For a share outstanding during the six Special
months ended April 30, 1998, (unaudited) Situations
or through each fiscal year Fund
or period ended October 31 1998 1997(3)
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 14.08 $ 10.00
- --------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income -- --
Net gains or (losses) on securities
(both realized and unrealized) 3.20 4.08
- --------------------------------------------------------------------------------
Total from Investment Operations 3.20 4.08
- --------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) -- --
Distributions (from capital gains) (.66) --
- --------------------------------------------------------------------------------
Total Distributions (.66) --
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $ 16.62 $ 14.08
================================================================================
Total Return* 23.75% 40.80%
================================================================================
Net Assets, End of Period (in thousands) $ 919,893 $ 333,777
Average Net Assets for the Period
(in thousands) $ 563,238 $ 168,215
Ratio of Gross Expenses to
Average Net Assets**(4) 1.10% 1.20%
Ratio of Net Expenses to
Average Net Assets**(4) 1.08% 1.18%
Ratio of Net Investment Income/(Loss)
to Average Net Assets** (0.10%) (0.08%)
Portfolio Turnover Rate** 99% 146%
Average Commission Per Share $ .0353 $ .0417
- --------------------------------------------------------------------------------
(1) Fiscal period June 28, 1996, (inception) to October 31, 1996
(2) Fiscal period December 29, 1995, (inception) to October 31, 1996
(3) Fiscal period December 31, 1996, (inception) to October 31, 1997
(4) See "Explanation of the Financial Highlights."
*Total return not annualized for periods of less than one full year
**Annualized for periods of less than one full year
NA - Disclosure not applicable to prior periods
See Notes to Financial Statements.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 54
<PAGE>
FINANCIAL HIGHLIGHTS
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 comprises dividends and interest income earned on
securities held by the funds. Following is the total of gains, realized and
unrealized. 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 are the funds' expense ratios, 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 funds' expenses may be reduced through expense reduction arrangements.
Those arrangements include the use of brokerage commissions and uninvested cash
balances earning interest or balance credits. 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 both prior to any expense offset and after the offsets.
Expense ratios prior to any expense offset are part of disclosure
requirements imposed in 1996. Years prior to 1995 do not reflect this
information.
The next line reports the ratio of net investment income, which is the
income earned divided by the average net assets of a fund during the reporting
period. Don't confuse this ratio with a fund's yield. The net investment income
ratio is not a true measure of a fund's yield because it doesn't take into
account the dividends distributed to the fund's investors.
The next ratio provided in this table is the portfolio turnover rate, which
measures the amount of buying and selling activity in the funds' portfolios.
Portfolio turnover is affected by market conditions, changes in the size of a
fund, the nature of the fund's 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.
The last item in the table is the average commission rate per share. This
number is derived by taking the agency commissions paid on equity securities
trades (excluding Syndicate or IPO and principal trades amounts, but including
foreign commissions) and dividing by the number of shares purchased. This is a
requirement under SEC regulations but is not a meaningful representation of
actual costs incurred.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 55
<PAGE>
NOTES TO SCHEDULES OF INVESTMENTS
ECU - European Currency Unit
JPY - Japanese Yen
*Non income-producing security
**A portion of this security has been segregated by the custodian to cover
segregation requirements on forward 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. Below is a
summary of the transactions with each such affiliate for the period ended April
30, 1998.
<TABLE>
<CAPTION>
Purchases Sales Realized Dividend Market Value
Shares Cost Shares Cost Gain/(Loss) Income at 4/30/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Janus Fund
Cadence Design Systems, Inc.(1) 4,114,420 $109,525,657 -- -- -- -- $ 675,645,626
Chancellor Media Corp.(2) 4,892,520 179,336,807 -- -- -- -- 360,644,543
Comcast Corp. - Special Class A 15,532,475 480,848,587 -- -- -- $ 682,164 714,792,431
Cytec Industries, Inc. -- -- 700,000 $ 19,978,225 $ 14,445,553 -- 150,602,194
Federal-Mogul Corp. 225,900 9,878,113 45,000 2,041,512 (55,304) 849,792 229,207,219
Gartner Group, Inc. - Class A 5,565,280 198,739,820 -- -- -- -- 184,349,900
Maxim Integrated Products, Inc.(3) 8,295,900 280,809,959 -- -- -- -- 454,497,338
Meredith Corp. 1,041,900 39,757,958 -- -- -- 350,526 134,828,650
Parametric Technology Co.(4) 5,357,500 160,547,623 -- -- -- -- 676,043,156
Pioneer Natural Resources Co. -- -- 4,727,425 194,407,711 (86,655,644) -- --
Smith International, Inc. 437,900 26,327,338 3,550,775 221,309,647 (32,392,269) -- --
Univision Communications,
Inc. - Class A(5) 1,457,789 56,314,685 -- -- -- -- 126,135,822
UNUM Corp.(6) -- -- 4,368,271 104,226,822 18,423,990 1,683,714 192,864,621
Wang Laboratories, Inc. -- -- -- -- -- -- 57,375,000
Wolters Kluwer N.V 1,275,041 184,125,528 8,700 1,300,237 6,847 -- 465,557,953
- ------------------------------------------------------------------------------------------------------------------------------------
$1,726,212,075 $543,264,154 ($86,226,827) $ 3,566,196 $4,422,544,453
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Enterprise Fund
PriCellular Corp. - Class A -- -- 1,077,025 $ 8,443,876 $ 5,381,287 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Growth and Income Fund
Dime Community Bancorp, Inc. 10,000 $ 237,187 810,000 $ 9,730,937 $ 7,329,044 $ 56,920 --
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Mercury Fund
Ocean Rig ASA -- -- 3,379,096 $ 6,649,277 ($ 2,768,313) -- $ 20,710,551
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Olympus Fund
CorporateFamily Solutions, Inc. 100,000 $ 2,245,000 -- -- -- -- $ 10,528,191
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Overseas Fund
Koninklijke Ahrend Groep N.V.(7) -- -- 169,628 $ 5,308,217 ($ 59,701) -- $ 25,182,087
Ortivus A.B. - B Shares(8) -- -- -- -- -- -- 10,657,500
- ------------------------------------------------------------------------------------------------------------------------------------
-- $ 5,308,217 ($ 59,701) -- $ 35,839,587
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Special Situations Fund
Bally Total Fitness Holding Corp. 603,100 $ 17,960,153 -- -- -- -- $ 43,145,325
ITEQ, Inc. 39,600 396,792 -- -- -- -- 11,696,850
Magnum Hunter Resources, Inc. 1,503,075 8,363,983 -- -- -- -- 10,239,698
- ------------------------------------------------------------------------------------------------------------------------------------
$ 26,720,928 -- -- -- $ 65,081,873
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Twenty Fund
UAL Corp. -- -- 2,278,065 $111,615,527 $ 83,591,569 -- $ 122,198,512
Janus Venture Fund
Chester Bancorp, Inc. -- -- 103,725 $ 1,481,479 $ 309,833 $ 7,261 --
Community Financial Corp. -- -- -- -- -- 48,256 $ 4,439,575
Engineering Animation, Inc.(9) 240,000 $ 9,570,938 -- -- -- -- 21,206,250
First Bergen Bancorp -- -- -- -- -- 19,213 3,650,375
South Street Financial Corp. -- -- -- -- -- 49,000 2,572,500
Southern Electronics Corp.(10) -- -- 217,500 4,211,165 (1,401,259) -- --
UTI Energy Corp. -- -- 350,000 13,037,164 (6,302,974) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
$ 9,570,938 $18,729,808 ($7,394,400) $ 123,730 $ 31,868,700
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 56
<PAGE>
NOTES TO SCHEDULES OF INVESTMENTS
<TABLE>
<CAPTION>
Purchases Sales Realized Dividend Market Value
Shares Cost Shares Cost Gain/(Loss) Income at 4/30/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Janus Worldwide Fund
Amer Group, Ltd. -- -- 1,248,452 $ 26,630,189 ($ 2,769,158) -- --
Assa-Abloy A.B. - Class B -- -- -- -- -- -- $ 159,705,172
Atos S.A -- -- 21,429 1,550,865 1,805,398 -- 94,640,559
Cellular Communications International,
Inc.(11) 895,133 $ 45,001,279 -- -- -- -- 39,385,830
Grupo Casa Autrey S.A. de C.V. (ADR) -- -- 85,112 1,944,009 (547,508) -- 21,038,522
JBA Holdings PLC -- -- 439,512 3,520,077 1,164,181 $ 182,323 20,146,706
NTT Data Corp. 845 44,406,211 300 11,856,214 2,462,443 172,611 145,224,678
SAS Norge ASA - Class B -- -- 321,273 3,514,659 1,527,539 639,235 19,984,305
Securitas A.B. - Class B -- -- -- -- -- -- 133,229,361
Tomra Systems ASA -- -- 538,608 7,711,619 5,551,346 78,736 47,092,952
- ------------------------------------------------------------------------------------------------------------------------------------
$ 89,407,490 $ 56,727,632 $ 9,194,241 $ 1,072,905 $ 680,448,085
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Adjusted for 2-for-1 stock split 11/17/97
(2) Adjusted for 2-for-1 stock split 1/13/98
(3) Adjusted for 2-for-1 stock split 12/22/97
(4) Adjusted for 2-for-1 stock split 3/9/98
(5) Adjusted for 2-for-1 stock split 1/13/98
(6) Adjusted for 2-for-1 stock split 6/3/97
(7) Adjusted for 2-for-1 stock split 7/1/97
(8) Adjusted for 2-for-1 stock split 4/23/98
(9) Adjusted for 3-for-2 stock split 3/2/98
(10) Name change from Southern Electronics Corp. effective 11/25/97
(11) Adjusted for 3-for-2 stock split 4/15/98
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 57
<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. Twelve 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 Janus Enterprise, Janus
Olympus, Janus Special Situations and Janus Twenty Funds, which are
nondiversified. Organization costs were borne by Janus Capital Corporation
("Janus Capital").
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. Certain dividends from
foreign securities will be recorded as soon as the Trust is informed of the
dividend if such information is obtained subsequent to 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 Currency Transactions and Futures Contracts
The Funds enter into forward currency contracts in order to reduce their
exposure to changes in foreign currency exchange rates on their foreign
portfolio holdings and to lock in the U.S. dollar cost of firm purchase and sale
commitments for securities denominated in foreign currencies. A forward currency
exchange contract is a commitment to purchase or sell a foreign currency at a
future date at a negotiated rate. The gain or loss arising from the difference
between the U.S. dollar cost of the original contract and the value of the
foreign currency in U.S. dollars upon closing of such contract is included in
net realized gain or loss from foreign currency transactions.
Forward currency contracts held by the Funds are fully collateralized by
other securities, which are denoted in the accompanying Schedule of Investments.
Such collateral is in the possession of the Funds' custodian. The collateral is
evaluated daily to ensure its market value equals or exceeds the current market
value of the corresponding forward currency contracts.
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 resultant 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 (i.e., treated as realized and subject to distribution) 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 indexes 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.
Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amount of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
Dividend Distributions and Expenses
Dividends for Janus Balanced, Janus Equity Income and Janus Growth and
Income Funds are declared and distributed quarterly and capital gains (if any)
are distributed annually. The remaining nine Equity Funds generally 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.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 58
<PAGE>
NOTES TO FINANCIAL STATEMENTS
2. Investment Advisory Agreement and Other Transactions with Affiliates
The advisory agreement with the Funds spells out the fees that the Funds
must pay for the period ended April 30, 1998. Each of the Funds was subject to
the following schedule:
Average Daily Net Annual Rate
Fee Schedule Assets of Fund Percentage (%)
- --------------------------------------------------------------------------------
Equity Funds First $300 Million .75
Next $200 Million .70
Over $500 Million .65
- --------------------------------------------------------------------------------
Janus Service Corporation ("Janus Service"), a wholly owned subsidiary of
Janus Capital, receives an annual fee of 0.16% of average net assets per fund,
plus $4.00 per shareholder account (excluding Janus and Janus Venture Funds) 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. Brokerage commissions paid, fees reduced and the net fees paid to DST
for the year or period ended April 30, 1998, are noted below.
DST Securities, Inc Fund
Commissions Expense
Paid* Reduction* DST Fees
- --------------------------------------------------------------------------------
Janus Fund $363,903 $272,927 $888,175
- --------------------------------------------------------------------------------
Janus Balanced Fund 6,123 4,592 43,573
- --------------------------------------------------------------------------------
Janus Enterprise Fund 2,227 1,670 106,936
- --------------------------------------------------------------------------------
Janus Equity Income Fund 910 682 18,182
- --------------------------------------------------------------------------------
Janus Growth and Income Fund 49,200 36,900 172,992
- --------------------------------------------------------------------------------
Janus Mercury Fund 13,734 10,300 269,012
- --------------------------------------------------------------------------------
Janus Olympus Fund 11,718 8,788 74,654
- --------------------------------------------------------------------------------
Janus Overseas Fund 4,968 3,726 189,334
- --------------------------------------------------------------------------------
Janus Special Situations Fund 5,100 3,825 61,581
- --------------------------------------------------------------------------------
Janus Twenty Fund 22,000 16,500 513,381
- --------------------------------------------------------------------------------
Janus Venture Fund 10,288 7,716 143,998
- --------------------------------------------------------------------------------
Janus Worldwide Fund 19,718 14,788 549,323
- --------------------------------------------------------------------------------
*The difference between commissions paid to DST Securities, Inc. and expenses
reduced constituted commissions paid to an unaffiliated clearing broker.
3. Federal Income Tax
The Funds have elected to treat gains and losses on forward currency
contracts as capital gains and losses. Other 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.
There were no net capital loss carryovers as of October 31, 1997. The
aggregate cost of investments and the composition of unrealized appreciation and
depreciation of investment securities for federal income tax purposes as of
April 30, 1998, are as follows:
<TABLE>
<CAPTION>
at April 30, 1998
---------------------------------------------------------------------
Net
Federal Tax Unrealized Unrealized Appreciation/
Cost Appreciation (Depreciation) (Depreciation)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Fund $15,462,416,546 $6,558,252,128 ($119,063,458) $6,439,188,670
- ------------------------------------------------------------------------------------------------------
Janus Balanced Fund 434,945,437 82,044,589 (2,437,334) 79,607,255
- ------------------------------------------------------------------------------------------------------
Janus Enterprise Fund 434,651,745 162,000,729 (6,043,935) 155,956,794
- ------------------------------------------------------------------------------------------------------
Janus Equity Income Fund 114,523,454 24,703,328 (1,316,618) 23,386,710
- ------------------------------------------------------------------------------------------------------
Janus Growth and Income Fund 2,061,685,986 663,713,111 (17,277,410) 646,435,701
- ------------------------------------------------------------------------------------------------------
Janus Mercury Fund 1,636,915,328 561,778,096 (21,177,467) 540,600,629
- ------------------------------------------------------------------------------------------------------
Janus Olympus Fund 563,063,308 219,359,578 (7,576,383) 211,783,195
- ------------------------------------------------------------------------------------------------------
Janus Overseas Fund 3,404,536,884 1,001,435,198 (86,403,380) 915,031,818
- ------------------------------------------------------------------------------------------------------
Janus Special Situations Fund 765,201,825 152,336,863 (7,421,270) 144,915,593
- ------------------------------------------------------------------------------------------------------
Janus Twenty Fund 5,434,618,092 2,630,203,153 (57,988,246) 2,572,214,907
- ------------------------------------------------------------------------------------------------------
Janus Venture Fund 859,200,174 382,298,773 (12,910,131) 369,388,642
- ------------------------------------------------------------------------------------------------------
Janus Worldwide Fund 10,419,954,867 3,665,177,281 (189,130,693) 3,476,046,588
- ------------------------------------------------------------------------------------------------------
</TABLE>
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 59
<PAGE>
This space available for your notes and computations.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 60
<PAGE>
This space available for your notes and computations.
JANUS EQUITY FUNDS APRIL 30, 1998 SEMIANNUAL REPORT 61
<PAGE>
[LOGO] JANUS
100 Fillmore Street
Denver, Colorado 80206-4923
1-800-525-3713
Funds distributed by Janus Distributors, Inc. Member NASD.
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