Janus | Income Funds
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1999 Annual Report
Janus Flexible Income Fund
Janus High-Yield Fund
Janus Federal Tax-Exempt Fund
Janus Short-Term Bond Fund
Janus Money Market Fund
Janus Government Money Market Fund
Janus Tax-Exempt Money Market Fund
[LOGO] Janus
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Janus | Income Funds
Table of Contents
To Our Shareholders ...................................... 1
Portfolio Manager's Commentary and Schedule of Investments
Janus Flexible Income Fund ........................... 2
Janus High-Yield Fund ................................ 7
Janus Federal Tax-Exempt Fund ........................ 11
Janus Short-Term Bond Fund ........................... 16
Janus Money Market Fund .............................. 20
Janus Government Money Market Fund ................... 25
Janus Tax-Exempt Money Market Fund ................... 27
Statements of Operations - Bond Funds .................... 30
Statements of Assets and Liabilities -
Bond Funds ........................................... 31
Statements of Changes in Net Assets -
Bond Funds ........................................... 32
Financial Highlights - Bond Funds ........................ 33
Statements of Operations -
Money Market Funds ................................... 35
Statements of Assets and Liabilities -
Money Market Funds ................................... 36
Statements of Changes in Net Assets -
Money Market Funds ................................... 37
Financial Highlights - Money Market Funds ................ 38
Notes to Schedules of Investments ........................ 42
Notes to Financial Statements ............................ 43
Explanation of Charts and Tables ......................... 46
Report of Independent Accountants ........................ 49
Year 2000 Discussion ..................................... 49
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To Our | Shareholders
[PHOTO]
Tom Bailey
chairman
The fixed-income markets faced a steady headwind throughout most of the fiscal
year. Initially, that headwind came in the form of robust U.S. economic growth,
rising long-term interest rates and inflation fears, creating an environment in
which investors favored stocks over bonds.
Later on, the winds shifted slightly, although not to the benefit of the bond
market. Continued above-trend growth in the U.S., improving global economies,
tight labor markets and price increases in commodities stirred up concerns about
rising inflation. In turn, the U.S. Federal Reserve reacted with two
quarter-point increases in short-term interest rates, which pushed most bond
prices lower, particularly those of longer-dated, rate-sensitive securities such
as Treasuries.
However, because high-yield corporate securities pay a wide spread over
Treasuries, they were able to withstand the pressure of rising rates.
Nonetheless, this area of the market faced various other challenges. At midyear,
an urgency to meet corporate financing needs ahead of potential Y2K-related
market disruptions created a flood of new high-yield issuance. Meanwhile, Y2K
concerns somewhat suppressed demand for these bonds as investors reduced their
high-yield inventories and carried higher cash balances into year-end.
Individual security selection consequently became more crucial than ever, and we
narrowed our focus to only the highest-quality, most liquid securities the
market had to offer.
This strategy also served us well in the investment-grade sector. While many of
these bonds reacted with some volatility to the changes in monetary policy, our
success in identifying companies with higher-rated debt that are enjoying rapid
earnings growth aided the performance of several of our funds. Furthermore, as
the spread, or difference in yield, between corporates and Treasuries widened,
so did the buying opportunity for investment-grade corporates. To that end, we
put our company-by-company research approach to work and uncovered a number of
opportunities we believe offer tremendous value yet to be recognized by the
market.
Recently, signs that U.S. economic growth may be moderating have led us to
conclude that the overall bond market should soon return to more normal levels.
However, I remind you that in good and bad economies alike, great investment
opportunities still exist. Finding those opportunities is what we're all about.
In closing, I'd like to comment on one of several steps we're taking toward
positioning Janus for success well into the future. On January 1, 2000,
portfolio manager Jim Craig will become full-time chief investment officer and
director of research, overseeing the ongoing strengthening of our collective
security-selection process. In his expanded role, Jim will focus intently on
analyst training and mentoring while continuing to monitor investment management
decisions across every fund we manage. I'm very excited about this advancement
now that every Janus shareholder will more directly benefit from Jim's extensive
experience and talent.
Thank you for your continued confidence and investment with Janus.
/s/ Tom
Tom Bailey
Past performance does not guarantee future results.
Janus Income Funds / October 31, 1999 1
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Janus | Flexible Income Fund
[PHOTO]
Ronald Speaker
portfolio manager
Janus Flexible Income Fund returned 1.75% for the fiscal year ended October 31,
1999, compared with (0.66%) for the Lehman Brothers Government/Corporate Bond
Index.(1)
It's been a challenging 12 months for fixed-income markets, especially given
that the Federal Reserve not only cut short-term interest rates at the beginning
of the year, but also raised them twice toward the end of it. However, the
Fund's flexible investment approach enabled us to respond to these changing
market conditions, delivering positive results by year-end.
Overall, we played our cards more carefully during the period, raising the
Fund's cash position and taking steps to lower its sensitivity to rising
interest rates. Because Treasury bonds are most vulnerable to interest rate
pressures, we reduced our weighting in this area by more than half, to 9.5%. At
the same time, we increased our weighting in investment-grade corporate debt,
focusing on bonds with intermediate maturities. We also upgraded the credit
quality of our investment-grade holdings, adding positions in well-financed
companies such as Wal-Mart, IBM and Ford Motor Company.
As far as the high-yield market goes, we maintained a conservative approach due
to the fact that bonds in this area were dealing with uncertainty over
Y2K-related market liquidity fears and competition from high-flying technology
stocks. This strategy proved successful, and we were rewarded for our focus on
large, well-financed issuers that were able to withstand broader market
pressures.
Additionally, we used the market's volatility to add select high-yield positions
in companies we felt were underappreciated by the market. In identifying these
credits, we benefited from our own hands-on research as well as from insights
shared by our equity research team. Two newer positions that contributed to our
performance were PSINet and Qwest Communications. Internet provider PSINet
continues to gain new corporate clients with its reliable, low-cost service.
Meanwhile, long-distance carrier Qwest just completed its 18,500-mile
state-of-the-art fiber-optic network and continues to grow its revenue at a
rapid pace, supported by high demand for its Internet connections and
fiber-optic services. Our Qwest bonds also benefited from the company's recent
acquisition of US West, a former Baby Bell company and a higher-rated credit.
We were also pleased with the performance of several of our pay-TV holdings,
including Charter Communications, Galaxy, RCN and Pegasus Media. These
high-yield bonds were less volatile and more liquid during the year as they
benefited from stable cash flows, the increasing penetration of premium services
such as pay-per-view and digital cable, as well as growing telephony and
Internet auxiliary revenues. RCN was also aided by a large equity investment
made by Microsoft cofounder Paul Allen's Vulcan Ventures.
Consolidation in the supermarket industry worked in our favor when two of our
larger positions, Fred Meyer and Star Markets, were acquired by companies with
Portfolio Asset Mix October 31, 1999 October 31, 1998
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Investment-Grade
Corporate Bonds/Warrants 48.3% 32.7%
High-Yield/High-Risk
Corporate Bonds 26.7% 28.9%
U.S. Government Bonds 9.5% 25.4%
Foreign Dollar/
Non-Dollar Bonds 4.5% 3.5%
Preferred Stock 1.6% 1.6%
Cash & Cash Equivalents 9.4% 7.9%
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Fund Profile October 31, 1999 October 31, 1998
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Weighted Average Maturity 7.9 Yrs. 9.1 Yrs.
Average Modified Duration* 5.3 Yrs. 6.1 Yrs.
30-Day Average Yield** 7.48% 6.05%
Average Rating BBB+ A
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* A theoretical measure of price volatility.
** Yield will fluctuate.
(1) Both returns include reinvested dividends.
Past performance does not guarantee future results.
2 Janus Income Funds / October 31, 1999
<PAGE>
higher credit ratings, effectively upgrading the quality of our holdings. Our
supermarket holdings offer us strong U.S.-based cash flows and generous yields,
and they are guided by managers who know the importance of maintaining
investment-grade ratings.
Moderating our returns was sluggish performance by our reduced position in
Treasury bonds, which, under the weight of rising interest rates, suffered from
declining prices and increasing yields. In fact, year-over-year, 30-year
Treasury bond yields rose nearly 1%. Another disappointment was our high-yield
position in Tokheim, a manufacturer of gas pumps. The company's revenues
declined when several global oil companies delayed their orders to Tokheim
following internal consolidation issues at the company, and we consequently sold
the position.
Looking ahead, we're encouraged by recent signs of a moderation in U.S. economic
growth. While we're confident that the pressure on fixed-income markets will
ease once interest rates stabilize, we also believe this challenging market can
work in our favor, providing us with opportunities to put our cash to work.
Consequently, we'll remain on the lookout for credits that offer solid interest
income as well as the potential for stable or appreciating prices.
In closing, we'd like to thank you for your continued investment in Janus
Flexible Income Fund.
Performance Overview
[GRAPHIC OMITTED]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Flexible Income Fund and the Lehman Brothers Government/Corporate Bond
Index. Janus Flexible Income Fund is represented by a shaded area of blue. The
Lehman Brothers Government/Corporate Bond Index is represented by a solid black
line. The "y" axis reflects the value of the investment. The "x" axis reflects
the computation periods from inception, July 7, 1987, through October 31, 1999.
The upper right quadrant reflects the ending value of the hypothetical
investment in Janus Flexible Income Fund ($27,866) as compared to the Lehman
Brothers Government/Corporate Bond Index ($26,578).
Average Annual Total Return
for the periods ended October 31, 1999
One Year, 1.75%
Five Year, 9.05%
Ten Year, 8.82%
Since 7/7/87*, 8.66%
Janus Flexible Income Fund - $27,866
Lehman Brothers
Government/Corporate
Bond Index - $26,578
*The Fund's inception date.
Source - Lipper, Inc. 1999.
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.
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
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Corporate Bonds - 77.6%
Automotive - Cars and Light Trucks - 1.6%
$ 20,000,000 DaimlerChrysler N.A. Holding Corp., 7.20%
company guaranteed notes, due 9/1/09 . $ 20,050,000
Automotive - Truck Parts and Equipment - 0.4%
5,000,000 TRW, Inc., 7.75%
debentures, due 6/1/29+ .............. 4,793,750
Beverages - Non-Alcoholic - 1.1%
15,000,000 Coca-Cola Enterprises, Inc., 6.95%
debentures, due 11/15/26 ............. 13,950,000
Beverages - Wine and Spirits - 0.8%
10,000,000 Joseph E. Seagram & Sons, Inc., 6.80%
company guaranteed notes, due 12/15/08 9,487,500
Brewery - 0.7%
10,000,000 Anheuser-Busch Companies, Inc., 5.65%
notes, due 9/15/08 ................... 9,137,500
Broadcast Services and Programming - 3.3%
40,000,000 AT&T Corp./Liberty Media Group, 7.875%
notes, due 7/15/09+ .................. 40,150,000
2,085,000 Digital Television Services, Inc., 12.50%
company guaranteed notes, due 8/1/07 . 2,220,525
42,370,525
Cable Television - 6.3%
$ 3,000,000 Century Communications Corp., 8.75%
senior notes, due 10/1/07 ............ $ 2,872,500
15,000,000 Charter Communications Holdings L.L.C
8.625%, senior notes, due 4/1/09 ..... 14,175,000
1,600,000 Classic Cable, Inc., 9.375%
company guaranteed notes, due 8/1/09 . 1,560,000
3,000,000 Comcast UK Cable Partners, Ltd., 11.20%
debentures, due 11/15/07 ............. 2,733,750
Cox Communications, Inc.:
20,000,000 6.375%, notes, due 6/15/00 ........... 19,975,000
7,500,000 7.875%, notes, due 8/15/09 ........... 7,753,125
3,500,000 Diamond Cable Communications PLC
zero coupon, senior discount notes
due 12/15/05 ......................... 3,185,000
11,000,000 Jones Intercable, Inc., 7.625%
senior notes, due 4/15/08 ............ 11,041,250
Lenfest Communications, Inc.:
4,500,000 10.50%, senior subordinated notes
due 6/15/06 .......................... 5,113,125
12,000,000 7.625%, senior notes, due 2/15/08 .... 12,060,000
80,468,750
See Notes to Scvedules of Investments.
Janus Income Funds / October 31, 1999 3
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Janus | Flexible Income Fund
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
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Casino Hotels - 1.1%
$ 4,000,000 Santa Fe Hotel, Inc., 11.00%
first mortgage notes, due 12/15/00 ... $ 3,870,000
13,250,000 Venetian Casino Resort L.L.C., 12.25%
company guaranteed notes, due 11/15/04 10,434,375
14,304,375
Casino Services - 0.7%
8,000,000 Isle of Capri Black Hawk L.L.C., 13.00%
first mortgage bonds, due 8/31/04 .... 8,760,000
Commercial Banks - 0.9%
7,000,000 City National Bank, 6.375%
subordinated notes, due 1/15/08 ...... 6,527,500
5,000,000 Hudson United Bancorp, Inc., 8.20%
subordinated debentures, due 9/15/06 . 5,000,000
11,527,500
Computer Services - 1.7%
2,500,000 Cooperative Computing, Inc., 9.00%
senior subordinated notes, due 2/1/08 2,068,750
3,600,000 Dialog Corp. PLC, 11.00%
senior subordinated notes, due 11/15/07 3,222,000
16,000,000 Electronic Data Systems Corp., 7.125%
notes, due 10/15/09 .................. 16,020,000
21,310,750
Computers - Micro - 2.3%
IBM Corp.:
22,000,000 5.375%, notes, due 2/1/09 ............ 19,827,500
10,000,000 7.00%, debentures, due 10/30/25 ...... 9,737,500
29,565,000
Cosmetics and Toiletries - 2.8%
35,000,000 Procter & Gamble Co., 6.875%
unsubaordinated notes, due 9/15/09 ... 35,218,750
Distribution and Wholesale - 0.2%
3,000,000 Aviation Sales Co., 8.125%
company guaranteed notes, due 2/15/08 2,550,000
Diversified Operations - 0.4%
5,000,000 Pac-West Telecomm, Inc., 13.50%
senior notes, due 2/1/09 ............. 5,075,000
Electric - Generation - 0.6%
7,000,000 Caithness Coso Fund Corp., 6.80%
secured notes, due 12/15/01+ ......... 6,912,500
Electric - Integrated - 1.0%
El Paso Electric Co.:
3,000,000 8.90%, first mortgage bonds, due 2/1/06 3,120,000
9,000,000 9.40%, first mortgage bonds, due 5/1/11 9,787,500
12,907,500
Fiber Optics - 0.3%
1,000,000 Metromedia Fiber Network, Inc., 10.00%
senior notes, due 11/15/08 ........... 987,500
3,000,000 Williams Communications Group, Inc. ....
10.875%, senior notes, due 10/1/09 ... 3,075,000
4,062,500
Finance - Auto Loans - 2.2%
Ford Motor Credit Co.:
10,000,000 6.125%, notes, due 4/28/03 ........... 9,750,000
18,500,000 7.375%, notes due 10/28/09 ........... 18,685,000
28,435,000
Finance - Other Services - 1.6%
$ 5,000,000 Arkwright CSN Trust, 9.625%
notes, due 8/15/26+ .................. $ 5,225,000
6,000,000 First American Capital Trust, 8.50%
company guaranteed notes, due 4/15/12 5,932,500
5,000,000 Ono Finance PLC, 13.00%
company guaranteed notes, due 5/1/09+ 4,975,000
5,000,000 SIG Capital Trust I, 9.50%
company guaranteed notes, due 8/15/27 3,725,000
19,857,500
Food - Diversified - 0.6%
8,000,000 Ralston Purina Co., 7.75%
debentures, due 10/1/15 .............. 8,100,000
Food - Retail - 9.3%
Fred Meyer, Inc.:
25,000,000 7.15%, company guaranteed notes
due 3/1/03 ........................... 24,843,750
50,000,000 7.45%, company guaranteed notes
due 3/1/08** ......................... 49,375,000
10,000,000 Marsh Supermarkets, Inc., 8.875%
company guaranteed notes, due 8/1/07 . 9,575,000
4,000,000 Pantry, Inc., 10.25%
company guaranteed notes, due 10/15/07 3,790,000
Safeway, Inc.:
15,000,000 5.875%, notes, due 11/15/01 .......... 14,718,750
7,500,000 7.50%, notes, due 9/15/09 ............ 7,500,000
4,000,000 Star Markets Company, Inc., 13.00%
senior subordinated notes, due 11/1/04 4,260,000
5,000,000 Stater Brothers Holdings, Inc., 10.75%
senior notes, due 8/15/06 ............ 5,087,500
119,150,000
Gambling - Non-Hotel Casinos - 1.0%
13,000,000 Lady Luck Gaming Corp., 11.875%
first mortgage notes, due 3/1/01 ..... 13,000,000
Hotels and Motels - 0.4%
5,000,000 Marriott International, Inc., 7.875%
notes, due 9/15/09 ................... 5,006,250
Internet Software - 2.3%
8,500,000 Exodus Communications, Inc., 11.25%
senior notes, due 7/1/08 ............. 8,648,750
20,000,000 PSINet, Inc., 11.00%
senior notes, due 8/1/09+ ............ 20,450,000
29,098,750
Leisure, Recreation and Gaming - 0.5%
8,000,000 Hard Rock Hotel, Inc., 9.25%
senior subordinated notes, due 4/1/05 5,860,000
Life and Health Insurance - 3.2%
Conseco, Inc.:
15,000,000 7.60%, senior notes, due 6/21/01 ..... 14,887,500
15,000,000 9.00%, notes, due 10/15/06 ........... 15,075,000
11,000,000 Delphi Financial Group, Inc., 8.00%
senior notes, due 10/1/03 ............ 11,082,500
41,045,000
Manufacturing - 0.2%
2,800,000 Day International Group, Inc., 11.125%
senior notes, due 6/1/05 ............. 2,870,000
Medical - Hospitals - 0.2%
3,000,000 Columbia/HCA Healthcare Corp., 8.36%
debentures, due 4/15/24 .............. 2,767,500
See Notes to Schedules of Investments.
4 Janus Income Funds / October 31, 1999
<PAGE>
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
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Medical Products - 0.7%
$ 8,500,000 Dade International, Inc. - Series B, 11 125%
senior subordinated notes, due 5/1/06 $ 8,967,500
Multimedia - 2.7%
10,000,000 News America, Inc., 6.625%
senior notes, due 1/9/08 ............. 9,350,000
Time Warner, Inc.:
15,250,000 8.18%, notes, due 8/15/07 ............ 16,050,625
10,000,000 6.95%, company guaranteed notes
due 1/15/28 .......................... 9,100,000
34,500,625
Music/Clubs - 0.4%
6,000,000 SFX Entertainment, Inc., 9.125%
company guaranteed notes, due 2/1/08 . 5,535,000
Networking Products - 0.8%
5,000,000 Anixter International, Inc., 8.00%
company guaranteed notes, due 9/15/03 5,006,250
4,250,000 Candescent Technologies Corp., 7.00%
convertible senior subordinated
debentures, due 5/1/03+ .............. 3,187,500
2,000,000 Concentric Network Corp., 12.75%
senior notes, due 12/15/07 ........... 2,060,000
10,253,750
Oil Companies - Integrated - 0.7%
8,500,000 Chevron Corp., 6.625%
notes, due 10/1/04 ................... 8,478,750
Optical Supplies - 0.6%
8,000,000 Bausch & Lomb, Inc., 6.75%
notes, due 12/15/04 .................. 7,780,000
Paint and Related Products - 0.8%
10,500,000 Sherwin-Williams Co., 6.85%
notes, due 2/1/07 .................... 10,290,000
Physical Therapy and Rehabilitation Centers - 0.7%
HEALTHSOUTH Corp.:
7,000,000 9.50%, senior subordinated notes
due 4/1/01 ........................... 6,807,500
2,500,000 7.00%, senior notes, due 6/15/08 ..... 2,081,250
8,888,750
Pipelines - 0.7%
10,000,000 Enron Corp., 7.375%
bonds, due 5/15/19 ................... 9,550,000
Recreational Centers - 0.8%
11,500,000 Bally Total Fitness Holding Corp., 9.875%
senior subordinated notes, due 10/15/07 10,867,500
Retail - Discount - 2.9%
6,700,000 Ames Department Stores, Inc., 10.00%
senior notes, due 4/15/06 ............ 6,566,000
30,000,000 Wal-Mart Stores, Inc., 6.875%
senior notes, due 8/10/09 ............ 30,150,000
36,716,000
Retail - Leisure Products - 0.7%
9,000,000 Selmer Company, Inc., 11.00%
senior subordinated notes, due 5/15/05 9,450,000
Retail - Restaurants - 1.5%
$ 10,000,000 McDonald's Corp., 6.375%
debentures, due 1/8/28 ............... $ 8,925,000
4,500,000 Perkins Family Restaurant L.P., 10.125%
senior notes, due 12/15/07 ........... 4,488,750
3,000,000 Romacorp, Inc., 12.00%
company guaranteed notes, due 7/1/06 . 2,895,000
3,500,000 Tricon Global Restaurants, Inc., 7.65%
senior notes, due 5/15/08 ............ 3,342,500
19,651,250
Savings/Loan/Thrifts - 3.8%
Dime Bancorp, Inc.:
12,000,000 6.375%, senior notes, due 1/30/01 .... 11,895,000
10,000,000 7.00%, senior notes, due 7/25/01 ..... 9,962,500
Golden State Holdings, Inc.:
5,000,000 7.00%, senior notes, due 8/1/03 ...... 4,737,500
10,000,000 7.125%, senior notes, due 8/1/05 ..... 9,200,000
8,000,000 People's Bank, 7.20%
subordinated notes, due 12/1/06 ...... 7,680,000
5,000,000 St. Paul Bancorp, Inc., 7.125%
senior notes, due 2/15/04 ............ 4,956,250
48,431,250
Super Regional Banks - 0.6%
8,000,000 NationsBank Corp., 7.75%
subordinated notes, due 8/15/15 ...... 8,010,000
Telecommunication Services - 6.1%
3,000,000 Adelphia Business Solutions, Inc., 12.00%
senior subordinated notes, due 11/1/07 3,090,000
6,650,000 CapRock Communications Corp., 11.50%
senior notes, due 5/1/09 ............. 6,417,250
11,000,000 Galaxy Telecom L.P., 12.375%
senior subordinated notes, due 10/1/05 11,742,500
10,000,000 Logix Communications Enterprises, Inc. .
12.25%, senior notes, due 6/15/08 .... 8,450,000
5,070,000 McLeodUSA, Inc., 9.25%
senior notes, due 7/15/07 ............ 5,044,650
9,045,000 NTL, Inc., 12.75%
senior notes, due 4/15/05 ............ 8,943,244
5,500,000 Pegasus Media Communications, 12.50%
notes, due 7/1/05 .................... 6,008,750
12,000,000 RCN Corp., 10.00%
senior notes, due 10/15/07 ........... 11,970,000
4,000,000 Versatel Telecom B.V., 13.25%
senior notes, due 5/15/08 ............ 4,000,000
12,000,000 Worldwide Fiber, Inc., 12.00%
senior notes, due 8/1/09+ ............ 12,030,000
77,696,394
Telephone - Integrated - 1.6%
3,200,000 Esprit Telecom Group PLC, 11.50%
senior notes, due 12/15/07 ........... 3,280,000
12,000,000 GTE Northwest, Inc., 5.55%
debentures, due 10/15/08 ............. 10,725,000
7,000,000 NEXTLINK Communications, Inc., 10.75%
senior notes, due 6/1/09 ............. 7,087,500
21,092,500
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 5
<PAGE>
Janus | Flexible Income Fund
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Telephone - Long Distance - 1.9%
$ 20,000,000 Qwest Communications International, Inc.
7.50%, senior notes, due 11/1/08 ..... $ 19,925,000
4,500,000 Viatel, Inc., 11.50%
senior notes, due 3/15/09 ............ 4,353,750
24,278,750
Television - 1.2%
15,000,000 Fox/Liberty Networks L.L.C., 8.875%
senior notes, due 8/15/07 ............ 15,225,000
Textile - Products - 0.6%
7,500,000 Collins & Aikman Floorcovering, Inc. ...
10.00%, senior subordinated notes
due 1/15/07 .......................... 7,181,250
Transportation - Services - 0.1%
2,000,000 Atlantic Express Transportation Corp., 10.75%
company guaranteed notes, due 2/1/04 . 1,915,000
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Total Corporate Bonds (cost $1,017,255,862) ............... 992,401,169
- --------------------------------------------------------------------------------
Foreign Bonds - 1.8%
Internet Software - 0.7%
EUR
8,200,000 PSINet, Inc., 11.00%
senior notes, due 8/1/09**,+ ......... 8,834,075
Telecommunication Services - 0.5%
EUR
6,500,000 Versatel Telecom B.V., 11.875%
senior notes, due 7/15/09** .......... 6,763,507
Telephone - Integrated - 0.6%
DEM
13,250,000 Esprit Telecom Group PLC, 11.50%
senior notes, due 12/15/07** ......... 7,262,872
- --------------------------------------------------------------------------------
Total Foreign Bonds (cost $22,736,726) .................... 22,860,454
- --------------------------------------------------------------------------------
Preferred Stock - 1.6%
Networking Products - 0.8%
10,622 Concentric Network Corp.
- Series B, 13.50% ................... 10,090,900
Savings/Loan/Thrifts - 0.8%
350,000 Chevy Chase Savings Bank, 13.00% ..... 10,500,000
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $20,134,605) .................. 20,590,900
- --------------------------------------------------------------------------------
Warrants - 0.1%
Finance - Other Services - 0%
5,000 Ono Finance PLC - expires 5/31/09* ..... 300,000
Retail - Diversified - 0%
3,100 SpinCycle, Inc. - expires 5/1/05* ...... 0
Telecommunication Services - 0.1%
3,450 MetroNet Communications Corp.
- expires 8/15/07* ................... 28,463
2,700 Versatel Telecom B.V.
- expires 5/15/08*,+ ................. 391,500
419,963
- --------------------------------------------------------------------------------
Total Warrants (cost $0) .................................. 719,963
- --------------------------------------------------------------------------------
U.S. Government Obligations - 9.5%
U.S. Treasury Notes:
$100,000,000 6.625%, due 5/15/07 .................. 102,522,000
20,000,000 5.625%, due 5/15/08** ................ 19,284,400
- --------------------------------------------------------------------------------
Total U.S. Government Obligations (cost $123,268,225) ..... 121,806,400
- --------------------------------------------------------------------------------
Repurchase Agreement - 7.9%
$101,400,000 ABN AMRO Securities, Inc., 5.34%
dated 10/29/99, maturing 11/1/99, to be
repurchased at $101,445,123 collateralized
by $83,559,201 in Fannie Mae, 5.75%-
7.577%, 2/1/09-11/1/30; $88,358,858
in Freddie Mac, 5.781%-11.34%, 5/1/00-
9/1/29; $31,050,035 in Ginnie Mae,
5.8312%-7.50%, 12/15/13-9/15/29;
with respective values of $31,777,420,
$43,873,883 and $27,776,697
(cost $101,400,000) .................. $ 101,400,000
- --------------------------------------------------------------------------------
Total Investments (total cost $1,284,795,418) - 98.5% ..... 1,259,778,886
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 1.5% 19,619,237
- --------------------------------------------------------------------------------
Net Assets - 100% ......................................... $ 1,279,398,123
- --------------------------------------------------------------------------------
Notional Unrealized
Swap Spread Lock Agreements Amount Gain/(Loss)
- --------------------------------------------------------------------------------
10-Year Swap Spread Lock with floating
rate based on 3-month spread for
10 year U.S. Treasury Security.
Counterparty: Goldman Sachs
Capital Markets, L.P.
Determination Date: November 19, 1999 $50,000,000 $ (842,475)
- --------------------------------------------------------------------------------
Forward Currency Contracts, Open at October 31, 1999
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
Euro 11/4/99 11,200,000 $ 11,798,080 $ 11,190
Euro 4/7/00 9,300,000 9,687,810 446,400
- --------------------------------------------------------------------------------
Total $ 21,485,890 $ 457,590
- --------------------------------------------------------------------------------
Financial Futures - Short
90 Contracts U.S. Treasury - 5-year bond, expires
December 1999, principal amount
$9,683,438, value $9,715,782,
cumulative depreciation ................ $ (32,344)
1,500 Contracts U.S. Treasury - 10-year bond, expires
December 1999, principal amount
$164,091,205, value $164,578,125,
cumulative depreciation ................ $ (486,920)
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
6 Janus Income Funds / October 31, 1999
<PAGE>
Janus | High-Yield Fund
[PHOTO]
Sandy Rufenacht
portfolio manager
For the fiscal year ended October 31, 1999, Janus High-Yield Fund returned
6.34%, outperforming the 4.34% gain by our benchmark, the Lehman Brothers
High-Yield Bond Index. (1)
This past year has been a challenging one for bond investors. The situation in
the emerging markets remains uncertain, stock prices have been turbulent, and
renewed inflation fears have put interest rates back on an upward track.
Uncertainty also remains over how investors will respond to the approaching Y2K
transition. Nonetheless, because high-yield bonds pay a wide spread over
Treasury bond rates, they were able to withstand the pressure of rising interest
rates and outperformed the rest of the fixed-income universe.
However, some worrisome trends surfaced. For example, default rates edged higher
throughout the year, although they remained low by historical standards. The
market was also flooded with new supply as corporations rushed to bring their
bond issues to market in an effort to meet their financing needs before
year-end. At the same time, liquidity was a problem as investors began selling
their bond inventory to boost their cash holdings. With this combination of
oversupply and shrinking demand, prices slumped and differences between yields
widened.
Against this backdrop, we decided to take some chips off the table while we
waited for interest rates to stabilize, the stock market to settle down and
Y2K-related market uncertainty to pass.
Consequently, we raised the Fund's cash position and shifted more assets into
higher-grade corporate debt. Unfortunately, this strategy somewhat hindered our
results. Higher-quality, lower-yielding bonds are typically more vulnerable to
rising interest rates, and our increased weighting in this area of the market
detracted from our performance. Even so, because our first priority is to
safeguard our investors' assets, especially in a turbulent market, we are
confident we made the right decision.
Another measure we took to insulate the Fund while meeting current income needs
was to raise our weighting in yield-to-call bonds. An example is our long-time
position in Price Communications, a cellular telephone service provider in the
Southeast. The company is improving its cash flow, which leads us to believe
there is a good chance it will refinance its debt and call in these bonds. The
market apparently agrees, and the bonds trade very close to their call price.
Until they are retired, however, we will continue to clip a nice coupon payment,
confident these bonds will maintain their value.
We were also pleased with the performance of Isle of Capri, a casino in
Blackhawk, Colorado. The management of the casino is using cash flow in all the
right ways - reinvesting in the business and paying down debt. Recently, Isle of
Capri purchased Lady Luck Casino, another holding in the Fund and one of our
strongest performers this year. Isle of Capri has announced it will retire the
Lady Luck high-yield debt at par, benefiting our position.
(continued on next page)
Fund Profile October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------
Weighted Average Maturity 6.0 Yrs. 7.4 Yrs.
Average Modified Duration* 4.2 Yrs. 5.2 Yrs.
30-Day Average Yield** 9.76% 9.50%
30-Day Average Yield
Without Reimbursement** 9.74% NA
Average Rating B- B
- --------------------------------------------------------------------------------
* A theoretical measure of price volatility.
** Yields will fluctuate.
(1) Both returns include reinvested dividends.
Past performance does not guarantee future results.
Janus Income Funds / October 31, 1999 7
<PAGE>
Our new position in Exodus Communications also contributed to the Fund's
performance. Exodus provides corporations with secure facilities where they can
house their corporate Web servers. The company has been adding new customers at
a rapid rate and saw revenues quadruple in the third quarter. This investment
allows us to participate in the growth of networking and e-commerce without
subjecting the Fund to the volatility of pure Internet investments.
While we were satisfied with our overall results, we were disappointed with the
performance of Hard Rock Hotel in Las Vegas. The bonds traded lower after a
recent hotel expansion temporarily hurt casino traffic and gaming revenues.
Although we were concerned with this misstep, we were confident the expansion
would ultimately bring more revenue to the casino. Our confidence was bolstered
when Hard Rock's owner invested $28 million of his own money in the form of
preferred stock. We held on to the position and are pleased by early figures
that show the business is back on track.
Going forward, we will continue to look for opportunities to put our cash back
to work, concentrating on high-quality, yield-to-call bonds issued by
well-managed companies with solid U.S.-based cash flows. As always, we will rely
on our own hands-on research and intensive analysis to seek out opportunities
others might have missed.
In closing, I'd like to thank you for investing in Janus High-Yield Fund.
Performance Overview
[GRAPHIC OMITTED]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus High-Yield Fund and the Lehman Brothers High-Yield Bond Index. Janus
High-Yield Fund is represented by a shaded area of blue. The Lehman Brothers
High-Yield Bond Index is represented by a solid black line. The "y" axis
reflects the value of the investment. The "x" axis reflects the computation
periods from inception, December 29, 1995, through October 31, 1999. The lower
right quadrant reflects the ending value of the hypothetical investment in Janus
High-Yield Fund ($14,665) as compared to the Lehman Brothers High-Yield Bond
Index ($12,801).
Average Annual Total Return
for the periods ended October 31, 1999
One Year, 6.34%
Since 12/29/95*, 10.47%
Janus High-Yield Fund - $14,665
Lehman Brothers
High-Yield Bond Index - $12,801
*The Fund's inception date.
Source - Lipper, Inc. 1999.
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.
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Corporate Bonds - 87.5%
Agricultural Operations - 1.2%
$ 3,000,000 Hines Horticulture, Inc., 11.75%
senior subordinated notes, due 10/15/05 $ 3,135,000
Broadcast Services and Programming - 0.8%
2,000,000 Digital Television Services, Inc., 12.50%
company guaranteed notes, due 8/1/07 . 2,130,000
Building - Residential and Commercial - 1.4%
2,000,000 MDC Holdings, Inc., 8.375%
senior notes, due 2/1/08 ............. 1,825,000
2,000,000 Webb (Del E.) Corp., 10.25%
senior subordinated notes, due 2/15/10 1,835,000
3,660,000
Cable Television - 6.3%
$ 2,000,000 Adelphia Communications Corp., 9.875%
senior notes, due 3/1/07 ............. $ 2,035,000
3,000,000 Charter Communications Holdings L.L.C.
8.625%, senior notes, due 4/1/09 ..... 2,835,000
3,000,000 Classic Cable, Inc., 9.375%
company guaranteed notes, due 8/1/09 . 2,925,000
2,500,000 Diamond Cable Communications PLC
zero coupon, senior discount notes
due 12/15/05 ......................... 2,275,000
3,000,000 FrontierVision Holdings L.P., 11.00%
senior subordinated notes, due 10/15/06 3,157,500
2,000,000 Fundy Cable, Ltd., 11.00%
senior notes, due 11/15/05 ........... 2,150,000
1,500,000 Mediacom L.L.C., 8.50%
senior notes, due 4/15/08 ............ 1,395,000
16,772,500
See Notes to Schedules of Investments.
8 Janus Income Funds / October 31, 1999
<PAGE>
Janus | High-Yield Fund
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Casino Hotels - 7.3%
$ 1,500,000 Aztar Corp., 8.875%
senior subordinated notes, due 5/15/07 $ 1,413,750
3,000,000 Majestic Star Casino L.L.C./Capital, 10.875%
company guaranteed notes, due 7/1/06 . 2,940,000
1,500,000 Park Place Entertainment Corp., 7.875%
senior subordinated notes, due 12/15/05 1,410,000
500,000 Riviera Black Hawk, Inc., 13.00%
first mortgage bonds, due 5/1/05+ .... 520,000
5,000,000 Santa Fe Hotel, Inc., 11.00%
first mortgage notes, due 12/15/00 ... 4,837,500
2,500,000 Station Casinos, Inc., 10.125%
senior subordinated notes, due 3/15/06 2,562,500
7,000,000 Venetian Casino Resort L.L.C., 12.25%
company guaranteed notes, due 11/15/04 5,512,500
19,196,250
Casino Services - 2.5%
6,000,000 Isle of Capri Black Hawk L.L.C., 13.00%
first mortgage bonds, due 8/31/04 .... 6,570,000
Cellular Telecommunications - 3.4%
2,000,000 Crown Castle International Corp., 9.00%
senior notes, due 5/15/11 ............ 1,905,000
4,000,000 Orange PLC, 8.00%
senior notes, due 8/1/08 ............. 4,005,000
3,000,000 Price Communications Wireless, Inc., 11.75%
senior subordinated notes, due 7/15/07 3,270,000
9,180,000
Computer Services - 3.5%
2,000,000 Cooperative Computing, Inc., 9.00%
senior subordinated notes, due 2/1/08 1,655,000
3,500,000 Globix Corp., 13.00%
senior notes, due 5/1/05 ............. 3,084,375
5,000,000 Splitrock Services, Inc., 11.75%
company guaranteed notes, due 7/15/08 4,587,500
9,326,875
Containers - Paper and Plastic - 3.6%
2,750,000 Packaged Ice, Inc., 9.75%
company guaranteed notes, due 2/1/05 . 2,347,812
4,000,000 SF Holdings Group, Inc., zero coupon
senior discount notes, due 3/15/08 ... 1,740,000
3,000,000 Stone Container Corp., 10.75%
first mortgage notes, due 10/1/02 .... 3,082,500
Sweetheart Cup Companies, Inc.:
1,500,000 9.625%, senior notes, due 9/1/00 ..... 1,462,500
1,000,000 10.50%, senior subordinated notes
due 9/1/03 ........................... 897,500
9,530,312
Distribution and Wholesale - 2.3%
2,000,000 Core-Mark International, Inc., 11.375%
senior subordinated notes, due 9/15/03 1,920,000
4,000,000 Herff Jones, Inc., 11.00%
senior subordinated notes, due 8/15/05 4,265,000
6,185,000
Diversified Operations - 2.9%
4,000,000 High Voltage Engineering Corp., 10.50%
senior notes, due 8/15/04 ............ 3,670,000
4,000,000 Pac-West Telecomm, Inc., 13.50%
senior notes, due 2/1/09 ............. 4,060,000
7,730,000
Fiber Optics - 1.2%
$ 3,000,000 NorthEast Optic Network, Inc., 12.75%
senior notes, due 8/15/08 ............ $ 3,090,000
Food - Retail - 2.8%
2,000,000 Carrols Corp., 9.50%
company guaranteed notes, due 12/1/08 1,675,000
5,500,000 Star Markets Company, Inc., 13.00%
senior subordinated notes, due 11/1/04 5,857,500
7,532,500
Gambling - Non-Hotel Casinos - 4.3%
1,500,000 Isle of Capri Casinos, Inc., 8.75%
company guaranteed notes, due 4/15/09 1,353,750
7,000,000 Lady Luck Gaming Corp., 11.875%
first mortgage notes, due 3/1/01 ..... 7,000,000
3,000,000 Louisiana Casino Cruises, Inc., 11.00%
notes, due 12/1/05 ................... 2,985,000
11,338,750
Home Decorating Products - 0.7%
2,000,000 Frank's Nursery & Crafts, Inc., 10.25%
senior subordinated notes, due 3/1/08 1,790,000
Hotels and Motels - 1.0%
2,500,000 Host Marriott Travel Plaza, 9.50%
senior notes, due 5/15/05 ............ 2,618,750
Internet Software - 4.9%
3,000,000 Exodus Communications, Inc., 11.25%
senior notes, due 7/1/08 ............. 3,052,500
PSINet, Inc.:
1,500,000 11.50%, senior notes, due 11/1/08 .... 1,571,250
4,000,000 11.00%, senior notes, due 8/1/09+ .... 4,090,000
4,000,000 Verio, Inc., 13.50%
senior notes, due 6/15/04 ............ 4,375,000
13,088,750
Leisure, Recreation and Gaming - 2.2%
8,000,000 Hard Rock Hotel, Inc., 9.25%
senior subordinated notes, due 4/1/05 5,860,000
Manufacturing - 0.6%
1,800,000 Foamex L.P., 9.875%
company guaranteed notes, due 6/15/07 1,579,500
Music/Clubs - 1.4%
4,000,000 SFX Entertainment, Inc., 9.125%
company guaranteed notes, due 2/1/08 . 3,690,000
Oil Companies - Exploration and Production - 1.2%
3,000,000 Forest Oil Corp., 10.50%
company guaranteed notes, due 1/15/06 3,097,500
Quarrying - 0.5%
1,500,000 Oglebay Norton Co., 10.00%
senior subordinated notes, due 2/1/09 1,440,000
Radio - 2.4%
3,000,000 Cumulus Media, Inc., 10.375%
company guaranteed notes, due 7/1/08 . 3,090,000
3,000,000 SFX Broadcasting, Inc., 10.75%
senior subordinated notes, due 5/15/06 3,266,250
6,356,250
Real Estate Investment and Management - 1.5%
4,000,000 LNR Property Corp., 10.50%
senior subordinated notes, due 1/15/09 3,950,000
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 9
<PAGE>
Janus | High-Yield Fund
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Resorts and Theme Parks - 0.5%
$ 2,000,000 Silverleaf Resorts, Inc., 10.50%
company guaranteed notes, due 4/1/08 . $ 1,450,000
Retail - Restaurants - 2.3%
6,000,000 Perkins Family Restaurant L.P., 10.125%
senior notes, due 12/15/07 ........... 5,985,000
Satellite Telecommunications - 0.9%
1,500,000 Echostar Communications Corp., 9.375%
senior notes, due 2/1/09 ............. 1,481,250
1,000,000 Innova S. de R.L., 12.875%
senior notes, due 4/1/07 ............. 827,500
2,308,750
Telecommunication Equipment - 0.7%
2,000,000 Covad Communications Group, Inc., 12.50%
senior notes, due 2/15/09 ............ 1,965,000
Telecommunication Services - 14.6%
2,000,000 Adelphia Business Solutions, Inc., 12.00%
senior subordinated notes, due 11/1/07 2,060,000
3,000,000 Alaska Communications Systems, Inc.
9.375%, senior subordinated notes
due 5/15/09+ ......................... 2,872,500
5,000,000 CapRock Communications Corp., 11.50%
senior notes, due 5/1/09 ............. 4,825,000
4,000,000 Galaxy Telecom L.P., 12.375%
senior subordinated notes, due 10/1/05 4,270,000
2,000,000 Global Crossing Holding, Ltd., 9.625%
company guaranteed notes, due 5/15/08 2,020,000
2,000,000 ITC DeltaCom, Inc., 11.00%
senior notes, due 6/1/07 ............. 2,100,000
6,000,000 Level 3 Communications, Inc., 9.125%
senior notes, due 5/1/08 ............. 5,550,000
4,000,000 NTL, Inc., 12.75%
senior notes, due 4/15/05 ............ 3,955,000
3,000,000 RCN Corp., 10.00%
senior notes, due 10/15/07 ........... 2,992,500
Versatel Telecom B.V.:
3,000,000 13.25%, senior notes, due 5/15/08 .... 3,000,000
2,000,000 11.875%, senior notes, due 7/15/09 ... 1,895,000
3,000,000 Worldwide Fiber, Inc., 12.00%
senior notes, due 8/1/09+ ............ 3,007,500
38,547,500
Telephone - Integrated - 2.0%
NEXTLINK Communications, Inc.:
3,000,000 12.50%, senior notes, due 4/15/06 .... 3,187,500
2,000,000 10.75%, senior notes, due 6/1/09 ..... 2,025,000
5,212,500
Telephone - Long Distance - 0.9%
2,000,000 Qwest Communications International, Inc.
10.875%, senior notes, due 4/1/07 .... 2,257,500
Textile - Products - 1.7%
3,500,000 Collins & Aikman Floorcovering, Inc.
10.00%, senior subordinated notes
due 1/15/07 .......................... 3,351,250
2,000,000 Glenoit Corp., 11.00%
company guaranteed notes, due 4/15/07 1,095,000
4,446,250
Transportation - Services - 2.0%
$ 4,000,000 Atlantic Express Transportation Corp., 10.75%
company guaranteed notes, due 2/1/04 . $ 3,830,000
1,500,000 RailWorks Corp., 11.50%
company guaranteed notes, due 4/15/09 1,451,250
5,281,250
Wire and Cable Products - 1.2%
3,000,000 International Wire Group, Inc., 11.75%
senior subordinated notes, due 6/1/05 3,052,500
Wireless Equipment - 0.8%
2,000,000 Nextel Communications, Inc., 9.75%
senior discount notes, due 8/15/04 ... 2,030,000
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $242,582,016) ................. 231,384,187
- --------------------------------------------------------------------------------
Preferred Stock - 0.5%
Radio - 0.5%
1,221 Cumulus Media, Inc. - Series A, 13.75%
(cost $1,351,591) .................... 1,346,153
- --------------------------------------------------------------------------------
Warrants - 0.3%
Internet Software - 0.2%
4,000 Bell Technology Group, Ltd. - expires 5/1/05* 630,000
Telecommunication Services - 0.1%
1,825 Splitrock Services, Inc. - expires 7/15/08* 173,375
- --------------------------------------------------------------------------------
Total Warrants (cost $91,250) ............................. 803,375
- --------------------------------------------------------------------------------
Repurchase Agreement - 9.5%
$ 25,000,000 ABN AMRO Securities, Inc., 5.34%
dated 10/29/99, maturing 11/1/99, to be
repurchased at $25,011,125 collateralized
by $20,601,381 in Fannie Mae, 5.75%-
7.577%, 2/1/09-11/1/30; $21,784,728 in
Freddie Mac, 5.781%-11.34%, 5/1/00-
9/1/29; $7,655,334 in Ginnie Mae,
5.8312%-7.50%, 12/15/13-9/15/29;
with respective values of $7,834,670,
$10,817,032 and $6,848,298
(cost $25,000,000) ................... 25,000,000
- --------------------------------------------------------------------------------
Total Investments (total cost $269,024,857) - 97.8% ....... 258,533,715
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 2.2% 5,941,845
- --------------------------------------------------------------------------------
Net Assets - 100% ......................................... $ 264,475,560
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
10 Janus Income Funds / October 31, 1999
<PAGE>
Janus | Federal Tax-Exempt Fund
[PHOTO]
Darrell Watters
portfolio manager
For the 12-month period ended October 31, 1999, Janus Federal Tax-Exempt Fund
returned (4.04%), compared with a (1.77%) return by its benchmark, the Lehman
Brothers Municipal Bond Index. (1)
One of the most important factors influencing markets over the past 12 months
has been the financial recovery in Asia. This time last year, when these
economies appeared to be in a downward spiral, many foreign investors sought the
safe haven of U.S. Treasury bonds. The resulting inflow of capital drove prices
higher and kept interest rates low. But as markets in the Far East started to
recover earlier this year, foreign investors pulled their money from U.S.
Treasuries and went in search of higher yields abroad. Consequently, the U.S.
Treasury market slumped, and the 30-year Treasury bond rate started to climb,
yielding 6.16% at fiscal year-end.
Renewed inflation fears also added to the pressure on interest rates, as U.S.
economic growth remained strong and tight labor markets continued to drive up
wage costs. Responding to the threat of an overheating economy, the Federal
Reserve raised short-term interest rates twice this summer. Policymakers also
signaled that at least one more rate hike was likely by year-end unless signs of
a slowing economy became apparent.
Overall, the volatility in fund flows and uncertainty over interest rates kept
fixed-income markets under pressure this year. In this investment climate,
maintaining safety of principal was our number one concern. That said, we
concentrated on higher-rated issues while keeping the Fund's average duration
close to that of its index. Unfortunately, these more liquid, higher-quality
bonds became sensitive to rising interest rates and lost ground, thus hindering
our performance.
We also saw weakness in the healthcare and hospital bond market and are
vigilantly monitoring our positions in Boulder Hospital Revenue and Denver
Health Services. Healthcare bonds in general have struggled recently because of
industry-wide concerns over government regulation and insurance reimbursements.
Fortunately, our exposure to this area of the tax-exempt market was limited.
Because we know our credits well, though, we're confident they will provide us
with solid long-term performance, regardless of what happens in the broader
healthcare market.
The Fund's relative performance was enhanced by our holdings in higher-coupon,
lower-rated bonds, which were less sensitive to rising interest rates. Most of
these credits are concentrated in the Rocky Mountain region, allowing us to
visit them regularly and employ the hands-on research for which Janus is known.
Within this area, we identified several opportunities we believe are currently
undervalued by the market and offer us the potential for price appreciation as
well as higher-coupon payments.
One position that worked well for us was Douglas County Nebraska Zoo. Revenues
and cash flow at the zoo have been very strong, supported by attendance at its
new world-class feline exhibit. Consequently, we think there is a good chance
the zoo will call these bonds in the near future. In the meantime, these credits
continue to trade in a narrow range around their call price, providing
(continued on next page)
Portfolio Asset Mix October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------
Corporate Bonds 1.6% 0.5%
Essential Service Revenue Bonds 78.4% 79.5%
General Obligation Bonds 20.0% 20.0%
- --------------------------------------------------------------------------------
Fund Profile October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------
Weighted Average Maturity 13.9 Yrs. 10.7 Yrs.
Average Modified Duration* 7.9 Yrs. 6.7 Yrs.
30-Day Average Yield** 5.48% 4.78%
30-Day Average Yield
Without Reimbursement** 5.22% 4.50%
Average Rating AA2 AA
- --------------------------------------------------------------------------------
* A theoretical measure of price volatility.
** Yields will fluctuate.
(1) Both returns include reinvested dividends.
Past performance does not guarantee future results.
Janus Income Funds / October 31, 1999 11
<PAGE>
welcome stability in a choppy market as well as generous interest payments.
We also maintained our exposure to Colorado double-tax-exempt bonds, which make
up about a third of total Fund assets. This strategy allows us to tap into the
state's strong economy and ensures a steady supply of attractive investment
opportunities as well as liquidity when shifting our positions becomes
necessary.
One success in this category was our position in Blackhawk gaming bonds. Casinos
in the town of Blackhawk account for 80% of all gaming revenues in Colorado, and
their share is growing. In fact, casino revenues in Blackhawk are increasing at
a double-digit rate during a time when revenues in the national gaming market
are slowing. We also like this position because we can drive up to Blackhawk in
an afternoon, check on the traffic at the casinos and spot any potential
problems.
At this writing, Asian economies look stronger, and the U.S. economy is showing
few signs of slowing, leading us to believe interest rates may move higher
before they stabilize. In this climate, we will concentrate on finding
high-quality bonds with higher-than-current-market coupons that will enable the
Fund to better absorb any future interest rate increases.
In closing, I would like to thank you for your continued investment in Janus
Federal Tax-Exempt Fund.
Performance Overview
[GRAPHIC OMITTED]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Federal Tax-Exempt Fund and the Lehman Brothers Municipal Bond Index.
Janus Federal Tax-Exempt Fund is represented by a shaded area of blue. The
Lehman Brothers Municipal Bond Index is represented by a solid black line. The
"y" axis reflects the value of the investment. The "x" axis reflects the
computation periods from inception, May 3, 1993, through October 31, 1999. The
lower right quadrant reflects the ending value of the hypothetical investment in
Janus Federal Tax-Exempt Fund ($13,180) as compared to the Lehman Brothers
Municipal Bond Index ($14,153).
Average Annual Total Return
for the periods ended October 31, 1999
One Year, (4.04%)
Five Year, 5.82%
Since 5/3/93*, 4.34%
Janus Federal Tax-Exempt Fund - $13,180
Lehman Brothers
Municipal Bond Index - $14,153
*The Fund's inception date.
Source - Lipper, Inc. 1999.
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.
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Corporate Bonds - 1.6%
Casino Hotels - 1.1%
$ 1,330,000 Venetian Casino Resort L.L.C., 12.25%
company guaranteed notes, due 11/15/04 $ 1,047,375
Gambling - Non-Hotel Casinos - 0.5%
500,000 Lady Luck Gaming Corp., 11.875%
first mortgage notes, due 3/1/01 ..... 500,000
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $1,664,522) ................... 1,547,375
- --------------------------------------------------------------------------------
Municipal Securities - 96.3%
Arizona - 2.6%
1,500,000 Phoenix, Series A, 4.50%, 7/1/15 ....... 1,278,750
1,500,000 Winslow Industrial Development Authority
Hospital Revenue, (Winslow Memorial
Hospital Project), 5.50%, 6/1/22 ..... 1,254,375
2,533,125
California - 5.2%
$ 1,000,000 California Educational Facilities Authority
Revenue, (Stanford University), Series P,
5.25%, 12/1/13 ....................... $ 993,750
1,000,000 California, 4.75%, 2/1/19 .............. 853,750
2,000,000 East Bay Municipal Utilities District Water
System Revenue, (MBIA Insured),
6.00%, 6/1/12 ........................ 2,095,000
1,000,000 M-S-R Public Power Agency Revenue,
(San Juan Project), (MBIA Insured),
Series E, 6.50%, 7/1/17 .............. 1,043,750
4,986,250
Colorado - 37.4%
3,000,000 Adams County Pollution Control Revenue,
(Public Service of Colorado), (MBIA
Insured), Series A, 5.625%, 4/1/08 ... 3,075,000
See Notes to Schedules of Investments.
12 Janus Income Funds / October 31, 1999
<PAGE>
Janus | Federal Tax-Exempt Fund
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Colorado - (continued)
$ 985,000 Bachelor Gulch Metropolitan District,
6.80%, 12/1/06 ....................... $ 992,388
510,000 Black Hawk, 5.70%, 12/1/12 ............. 510,000
Black Hawk Device Tax Revenue:
30,000 6.00%, 12/1/03 ....................... 30,150
25,000 6.10%, 12/1/07 ....................... 25,125
50,000 6.00%, 12/1/09 ....................... 49,750
500,000 6.00%, 12/1/11 ....................... 497,500
650,000 5.50%, 12/1/12 ....................... 618,313
1,250,000 5.625%, 12/1/21 ...................... 1,153,125
Boulder County Hospital Revenue,
(Longmont United Hospital Project):
1,000,000 5.50%, 12/1/12 ....................... 930,000
1,000,000 5.60%, 12/1/17 ....................... 901,250
1,000,000 Castle Rock Golf Enterprise Revenue,
6.50%, 12/1/16 ....................... 978,750
Central Platte Valley Metropolitan District:
1,000,000 5.15%, 12/1/13 ....................... 936,250
500,000 5.30%, 12/1/18 ....................... 453,750
Colorado Housing Finance Authority,
(Single Family Program):
1,000,000 Series C-2, 7.10%, 5/1/15 ............ 1,047,500
1,000,000 Series B-3, 6.80%, 11/1/28** ......... 1,070,000
1,000,000 Series B-3, 6.50%, 10/1/29 ........... 1,051,250
1,000,000 Denver Health and Hospital Revenue,
Series A, 5.375%, 12/1/18 ............ 861,250
Denver West Metropolitan District:
590,000 Series B, 5.60%, 12/1/12 ............. 576,725
265,000 6.15%, 12/1/13 ....................... 267,650
750,000 6.50%, 6/1/16 ........................ 765,000
615,000 6.20%, 6/1/17 ........................ 613,463
775,000 Series B, 5.70%, 12/1/17 ............. 735,281
E-470 Public Highway Authority Revenue,
(MBIA Insured), Series A:
2,000,000 4.75%, 9/1/23 ........................ 1,650,000
1,000,000 5.00%, 9/1/26 ........................ 853,750
Eaglebend Affordable Housing Corp.
Multifamily Revenue, (Housing Project):
1,000,000 Series A, 6.40%, 7/1/17 .............. 967,500
1,270,000 Series B, 7.40%, 7/1/21 .............. 1,216,025
1,000,000 Erie Water Enterprise Revenue, Series B,
6.00%, 12/1/17 ....................... 1,081,250
2,000,000 Fort Collins Pollution Control Revenue,
(Anheuser-Busch Project), 6.00%, 9/1/31 1,967,500
1,000,000 Glenwood Springs Sales and Use Tax
Revenue, (MBIA Insured), 4.80%, 10/1/18 851,250
20,000 Grand Lake Sales Tax Revenue,
5.50%, 10/15/08 ...................... 18,400
25,000 Gunnison Valley Hospital Revenue,
5.20%, 7/1/08 ........................ 23,250
Colorado - (continued)
Hyland Hills Metropolitan Parks and
Recreation District Special Revenue,
Series A:
$ 850,000 5.00%, 12/15/06 ...................... $ 843,625
410,000 6.10%, 12/15/09 ...................... 399,238
500,000 6.75%, 12/15/15 ...................... 515,625
1,000,000 Mountain Village Metropolitan District
San Miguel County, 8.10%, 12/1/11 .... 1,097,468
1,835,000 Parker Jordan Metropolitan District,
Series B, 6.10%, 12/1/17 ............. 1,669,850
115,000 Plains Metropolitan District, 5.85%, 12/1/05 116,248
Sand Creek Metropolitan District:
1,000,000 7.125%, 12/1/16 ...................... 983,750
1,000,000 6.625%, 12/1/17 ...................... 928,750
10,000 South Suburban Park and Recreation District
Golf Course and Ice Arena Facilities,
5.30%, 11/1/01 ....................... 9,937
100,000 Telluride Excise Tax Revenue
5.75%, 12/1/12 ....................... 100,250
Telluride Housing Authority Housing
Revenue, (Shandoka Apartments Project):
100,000 7.50%, 6/1/12 ........................ 103,750
1,500,000 7.50%, 6/1/23 ........................ 1,563,750
Upper Cherry Creek Metropolitan District:
500,000 6.20%, 12/1/05 ....................... 504,375
400,000 6.75%, 12/1/11 ....................... 420,000
36,025,011
Florida - 2.6%
3,000,000 Orange County Tourist Development Tax
Revenue, (AMBAC Insured), Series A,
4.75%, 10/1/24 ....................... 2,456,250
Georgia - 1.6%
1,400,000 Georgia Municipal Electric Authority Power
Revenue, (MBIA Insured), Series Y,
6.50%, 1/1/17 ........................ 1,501,500
Illinois - 4.7%
1,500,000 Cook County, (MBIA Insured), Series B,
5.375%, 11/15/18 ..................... 1,381,875
1,000,000 Metropolitan Pier and Exposition Authority
Hospitality Facilities Revenue,
(McCormick Place Convention Center
Project), 7.00%, 7/1/26 .............. 1,127,500
2,000,000 Regional Transportation Authority, (FGIC
Insured), 6.00%, 6/1/23 .............. 1,977,500
4,486,875
Massachusetts - 2.3%
2,100,000 Massachusetts Water Reservoir Authority,
(MBIA Insured), Series A, 6.50%, 12/1/19 2,233,875
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 13
<PAGE>
Janus | Federal Tax-Exempt Fund
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Minnesota - 2.2%
$ 440,000 Maplewood Multifamily Revenue,
(Hazel Ridge Project), Series B,
7.50%, 12/15/32 ...................... $ 408,100
2,000,000 Northern Municipal Power Agency Electric
System Revenue, (AMBAC Insured),
Series B, 4.75%, 1/1/20 .............. 1,687,500
2,095,600
Mississippi - 0.8%
740,000 Harrison County School District State Aid
Capital Improvement, (FSA Insured),
6.25%, 8/1/02 ........................ 772,375
Missouri - 2.1%
2,000,000 Missouri, (Fourth State Building), Series A,
5.75%, 8/1/18 ........................ 1,987,500
Montana - 2.7%
Montana Health Facilities Authority
Facilities Revenue:
750,000 (St. Peter's Community Hospital Project),
5.50%, 6/1/11 ........................ 721,875
1,000,000 (Kalispell Regional Hospital Project),
(AMBAC Insured), 5.00%, 7/1/18 ....... 866,250
1,000,000 Montana State Board of Investments,
(Payroll Tax), (MBIA Insured),
6.875%, 6/1/20 ....................... 1,045,000
2,633,125
Nebraska - 2.9%
2,800,000 Douglas County Nebraska Zoo
Facilities Revenue, (Henry Doorly Zoo
Aquarium Project), 6.00%, 6/1/03 ..... 2,802,520
New Jersey - 1.1%
1,000,000 New Jersey State Turnpike Authority
Turnpike Revenue, (FSA Insured),
Series C, 6.50%, 1/1/16 .............. 1,081,250
New Mexico - 3.6%
1,500,000 New Mexico Finance Authority Revenue,
(Federal Highway Grant Anticipated),
(AMBAC Insured), Series A, 4.25%,
9/1/06 ............................... 1,432,500
2,000,000 University of New Mexico, University
Revenues, Series A, 6.00%, 6/1/21 .... 2,015,000
3,447,500
New York - 6.8%
Long Island Power Authority Electric
System Revenue:
$ 2,000,000 Series A, 5.25%, 12/1/26 ............. $ 1,737,500
2,600,000 Series A, 5.50%, 12/1/29 ............. 2,327,000
300,000 Series 6, Variable Rate, 3.65%, 5/1/33 300,000
1,000,000 New York State Dormitory Authority
Revenues, (State University Educational
Facilities), Series A, 5.50%, 5/15/19 936,250
1,345,000 St. Lawrence County Industrial Development
Civic Facilities Revenue, (St. Lawrence
University Project), (MBIA Insured),
Series A, 5.375%, 7/1/18 ............. 1,257,575
6,558,325
North Carolina - 2.8%
3,000,000 North Carolina, (Public School Building),
4.60%, 4/1/14 ........................ 2,658,750
North Dakota - 1.4%
1,500,000 Grand Forks Senior Housing Revenue,
(4000 VY Square Project),
6.375%, 12/1/34 ...................... 1,378,125
Ohio - 1.3%
1,250,000 Toledo-Lucas County Port Authority, Port
Revenue, (Cargill Income Project),
5.90%, 12/1/15 ....................... 1,257,812
Oklahoma - 1.6%
500,000 McGee Creek Authority Water Revenue,
(MBIA Insured), 6.00%, 1/1/23 ........ 503,750
1,000,000 Tulsa Industrial Authority Revenue,
(University of Tulsa), (MBIA Insured),
Series A, 6.00%, 10/1/16 ............. 1,033,750
1,537,500
Puerto Rico - 0.9%
1,000,000 Puerto Rico Commonwealth, 5.00%, 7/1/28 851,250
Texas - 7.7%
2,000,000 Dallas-Fort Worth International Airport
Facilities Improvement Corporate
Revenue, (American Airlines, Inc.),
6.00%, 11/1/14 ....................... 1,967,500
Harris County Health Facilities
Development Corp. Revenue,
(St. Luke's Episcopal Hospital):
500,000 Series A, Variable Rate, 3.65%, 2/15/27 500,000
2,900,000 Series B, Variable Rate, 3.65%, 2/15/27 2,900,000
See Notes to Schedules of Investments.
14 Janus Income Funds / October 31, 1999
<PAGE>
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Texas - (continued)
$ 1,000,000 Orange County Naval and Port District
Industrial Development Corp. Revenue,
(North Star Steel Texas Project),
6.375%, 2/1/17 ....................... $ 1,025,000
1,000,000 Texas State Public Finance Authority,
Series C, 4.70%, 10/1/03 ............. 1,006,250
7,398,750
Wisconsin - 1.0%
1,000,000 Wisconsin, Series D, 4.25%, 5/1/05 ..... 971,250
Wyoming - 1.0%
1,000,000 Sweetwater County Pollution Control
Revenue, (Idaho Power Co.), Series A,
6.05%, 7/15/26 ....................... 985,000
- --------------------------------------------------------------------------------
Total Municipal Securities (cost $98,245,396) ............. 92,639,518
- --------------------------------------------------------------------------------
Total Investments (total cost $99,909,918) - 97.9% ........ 94,186,893
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 2.1% 2,012,574
- --------------------------------------------------------------------------------
Net Assets - 100% ......................................... $ 96,199,467
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Financial Futures - Short
25 Contracts U.S. Treasury - 20-year bond,
expires December 1999
principal amount $2,806,075
value $2,839,844,
cumulative depreciation .............. $ (33,769)
- --------------------------------------------------------------------------------
AMBAC - American Municipal Bond Assurance Corp.
FGIC - Financial Guaranty Insurance Corp.
FSA - Financial Security Assurance Corp.
MBIA - Municipal Bond Insurance Association Corp.
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 15
<PAGE>
Janus | Short-Term Bond Fund
[PHOTO]
Sandy Rufenacht
portfolio manager
For the 12-month period ended October 31, 1999, Janus Short-Term Bond Fund
returned 2.82%, while its benchmark, the Lehman Brothers 1-3 Year
Government/Corporate Bond Index, gained 3.20%. (1)
As Tom Bailey points out in his letter, the past year has been a challenging one
for fixed-income markets. Long-term interest rates were rising, the Federal
Reserve took a more aggressive stance to slow the economy, and international
economic recoveries remained fragile.
In this volatile environment, we were aided by our flexible investment approach,
which helped us respond quickly to changing market dynamics. We kept the Fund's
average maturity in line with its benchmark to balance the threat of Federal
Reserve rate hikes against the prospect of increased year-end demand for
high-quality, short-term paper. We also remained selective in our choice of
investments, focusing on issuers with sound business plans, solid domestic cash
flows and limited exposure to international markets. Consequently, stable
investment-grade names such as Wal-Mart and Ford continued to be prominent
holdings.
Additionally, we benefited from the credit improvement of select telecom and
media bonds in the investment-grade area, which offset the downward pressure on
the broader fixed-income market. Standouts included telecommunications giant MCI
WorldCom and cable service provider Cox Communications.
Our holdings in high-yielding corporate securities also aided the Fund's
performance. The wider spreads, or difference in yields, on these instruments
provided a cushion against rising interest rates, while their higher interest
payments bolstered our total income. These positions were primarily in
yield-to-call bonds, which trade close to their call price because investors
anticipate they will be retired in the near future. While they have little
potential for price appreciation, these bonds offer a low-risk investment that
also pays a healthy coupon.
For example, Host Marriott Travel Plaza, a former subsidiary of Marriott
Corporation that operates food and drink concessions at travel and entertainment
venues, was a yield-to-call position that worked in our favor. The company was
recently purchased by Autogrill, part of Italy's Bennetton group, which has
announced plans to pay off the bonds earlier than anticipated. Until this
happens, we will continue to clip a generous coupon. Nextel, a wireless
telecommunications provider, is another name that we expect to be retired early.
These bonds were underwritten with multiple restrictions that the company would
like to be free of going forward. We expect that they will be retired at a
premium in the near future.
HEALTHSOUTH is another position worth mentioning. This bond was upgraded from
high-yield to investment-grade status during the period, which helped it
continue a long run of success for us.
Portfolio Asset Mix October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------
Investment-Grade
Corporate Bonds 84.2% 60.2%
High-Yield/High-Risk
Corporate Bonds 13.2% 12.4%
U.S. Treasury Bonds -- 24.4%
Cash & Cash Equivalents 2.6% 3.0%
- --------------------------------------------------------------------------------
Fund Profile October 31, 1999 October 31, 1998
- --------------------------------------------------------------------------------
Weighted Average Maturity 2.4 Yrs. 2.6 Yrs.
Average Modified Duration* 2.1 Yrs. 2.3 Yrs.
30-Day Average Yield** 6.32% 4.89%
30-Day Average Yield
Without Reimbursement** 6.08% 4.44%
Average Rating A- A+
- --------------------------------------------------------------------------------
* A theoretical measure of price volatility.
** Yields will fluctuate.
(1) Both returns include reinvested dividends.
Past performance does not guarantee future results.
16 Janus Income Funds / October 31, 1999
<PAGE>
However, it recently declined along with the rest of the healthcare sector
because of uncertainty over insurance reimbursements and changes in government
regulations. While we believe this well-capitalized company has been
misunderstood by the market, we felt the volatility associated with these issues
was too risky for our investors, so we elected to liquidate our position.
Looking ahead, we believe the threat of additional interest rate increases will
keep the short-term bond market on edge. In this environment, we will approach
the markets with a conservative posture, continuing to focus on safeguarding the
underlying value of the Fund's assets while investing in higher-coupon
securities to meet current income needs. Our strategy will also involve keeping
the Fund's duration close to that of our benchmark until interest rates
stabilize.
In closing, I'd like to thank you for your continued investment in Janus
Short-Term Bond Fund.
Performance Overview
[GRAPHIC OMITTED]
A graphic comparison of the change in value of a hypothetical $10,000 investment
in Janus Short-Term Bond Fund and the Lehman Brothers 1-3 Year
Government/Corporate Bond Index. Janus Short-Term Bond Fund is represented by a
shaded area of blue. The Lehman Brothers 1-3 Year Government/Corporate Bond
Index is represented by a solid black line. The "y" axis reflects the value of
the investment. The "x" axis reflects the computation periods from inception,
September 1, 1992, through October 31, 1999. The upper right quadrant reflects
the ending value of the hypothetical investment in Janus Short-Term Bond Fund
($14,226) as compared to the Lehman Brothers 1-3 Year Government/Corporate Bond
Index ($14,692).
Average Annual Total Return
for the periods ended October 31, 1999
One Year, 2.82%
Five Year, 5.80%
Since 9/1/92*, 5.04%
Janus Short-Term Bond Fund - $14,226
Lehman Brothers
1-3 Year Government/Corporate
Bond Index - $14,692
*The Fund's inception date.
Source - Lipper, Inc. 1999.
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.
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Corporate Notes - 97.4%
Automotive - Truck Parts and Equipment - 2.5%
$ 3,500,000 TRW, Inc., 6.50%
notes, due 6/1/02+ ................... $ 3,451,875
Cable Television - 4.8%
400,000 Adelphia Communications Corp., 11.875%
debentures, due 9/15/04 .............. 418,000
2,000,000 Cox Communications, Inc., 6.375%
notes, due 6/15/00 ................... 1,997,500
1,500,000 Falcon Holdings Group L.P., 8.375%
debentures, due 4/15/10 .............. 1,492,500
675,000 FrontierVision Holdings L.P., 11.00%
senior subordinated notes, due 10/15/06 710,437
1,850,000 Lenfest Communications, Inc., 10.50%
senior subordinated notes, due 6/15/06 2,102,063
6,720,500
Casino Hotels - 1.0%
1,400,000 Park Place Entertainment Corp., 7.95%
notes, due 8/1/03+ ................... 1,384,250
Casino Services - 1.0%
1,380,000 Empress Entertainment, Inc., 8.125%
company guaranteed notes, due 7/1/06 . 1,338,600
Chemicals - Diversified - 2.0%
2,800,000 E.I. du Pont de Nemours and Co., 6.75%
notes, due 10/15/04 .................. 2,800,000
Chemicals - Specialty - 0.4%
$ 500,000 NL Industries, Inc., 11.75%
senior notes, due 10/15/03 ........... $ 524,375
Commercial Banks - 1.4%
2,000,000 Firstar Corp., 6.35%
senior notes, due 7/13/01 ............ 1,987,500
Computers - Micro - 2.9%
4,000,000 IBM Corp., 6.375%
notes, due 6/15/00 ................... 4,010,000
Consulting Services - 1.0%
1,500,000 Comdisco, Inc., 5.95%
notes, due 4/30/02 ................... 1,451,250
Containers - Paper and Plastic - 1.1%
490,000 Container Corp. of America, 11.25%
senior notes, due 5/1/04 ............. 510,825
1,000,000 Stone Container Corp., 10.75%
first mortgage notes, due 10/1/02 .... 1,027,500
1,538,325
Distribution and Wholesale - 0.3%
350,000 Herff Jones, Inc., 11.00%
senior subordinated notes, due 8/15/05 373,188
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 17
<PAGE>
Janus | Short-Term Bond Fund
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Diversified Financial Services - 6.5%
$ 3,750,000 Associates Corp. N.A., 5.85%
senior notes, due 1/15/01 ............ $ 3,721,875
IBM Credit Corp.:
2,000,000 5.05%, notes, due 1/22/01 ............ 1,970,000
1,400,000 6.64%, notes, due 10/29/01 ........... 1,403,500
2,000,000 Norwest Financial, Inc., 5.125%
senior notes, due 4/15/00 ............ 1,995,160
9,090,535
Diversified Operations - 2.1%
3,000,000 Warner-Lambert Co., 5.75%
notes, due 1/15/03 ................... 2,936,250
Electric - Integrated - 3.8%
1,800,000 PECO Energy Co., 5.625%
first mortgage notes, due 11/1/01 .... 1,759,500
3,500,000 Southern California Edison Co., 5.875%
notes, due 1/15/01 ................... 3,478,125
5,237,625
Finance - Auto Loans - 7.3%
Ford Motor Credit Co.:
3,750,000 6.25%, notes, due 11/8/00 ............ 3,744,862
2,000,000 5.75%, notes, due 1/25/01 ............ 1,982,500
2,000,000 5.125%, notes, due 10/15/01 .......... 1,947,500
2,500,000 6.375%, notes, due 12/1/01 ........... 2,484,375
10,159,237
Finance - Credit Card - 1.1%
1,500,000 American Express Credit Corp., 6.125%
senior notes, due 11/15/01 ........... 1,492,500
Finance - Investment Bankers/Brokers - 4.1%
3,750,000 Merrill Lynch & Company, Inc., 6.00%
notes, due 3/1/01 .................... 3,721,875
2,000,000 Morgan Stanley Dean Witter & Co., 6.25%
notes, due 3/15/00 ................... 2,002,220
5,724,095
Finance - Other Services - 4.6%
1,000,000 Mellon Financial Co., 6.30%
senior notes, due 6/1/00 ............. 1,001,840
2,000,000 Racers-Kellogg, 5.75%
bonds, due 2/2/01+ ................... 1,990,000
3,500,000 Sears Roebuck Acceptance Corp., 6.00%
notes, due 3/20/03 ................... 3,399,375
6,391,215
Food - Flour and Grain - 2.4%
3,500,000 Archer Daniels Midland Co., 6.25%
notes, due 5/15/03 ................... 3,460,625
Food - Retail - 5.8%
935,000 Albertson's, Inc., 6.55%
senior notes, due 8/1/04 ............. 922,144
1,500,000 Fred Meyer, Inc., 7.15%
company guaranteed notes, due 3/1/03 . 1,490,625
Safeway, Inc.:
2,000,000 5.75%, notes, due 11/15/00 ........... 1,982,500
2,250,000 5.875%, notes, due 11/15/01 .......... 2,207,812
1,310,000 Star Markets Company, Inc., 13.00%
senior subordinated notes, due 11/1/04 1,395,150
7,998,231
Gambling - Non-Hotel Casinos - 0.4%
$ 500,000 Lady Luck Gaming Corp., 11.875%
first mortgage notes, due 3/1/01 ..... $ 500,000
Hotels and Motels - 2.0%
1,500,000 Host Marriott Travel Plaza, 9.50%
senior notes, due 5/15/05 ............ 1,571,250
1,250,000 Hyatt Equities L.L.C., 6.80%
notes, due 5/15/00+ .................. 1,250,000
2,821,250
Independent Power Producer - 0.6%
950,000 Calpine Corp., 7.75%
senior notes, due 4/15/09 ............ 896,562
Life and Health Insurance - 2.0%
Conseco, Inc.:
1,000,000 7.60%, senior notes, due 6/21/01 ..... 992,500
1,800,000 8.50%, notes, due 10/15/02 ........... 1,806,750
2,799,250
Medical - Drugs - 1.8%
2,500,000 SmithKline Beecham PLC, 6.75%
company guaranteed notes, due 10/30/01 2,515,625
Money Center Banks - 4.3%
3,000,000 Bank of America Corp., 6.65%
senior notes, due 5/1/01 ............. 3,007,500
3,000,000 Chase Manhattan Corp., 5.50%
notes, due 2/15/01 ................... 2,962,500
5,970,000
Multimedia - 5.2%
3,750,000 Time Warner, Inc., 6.10%
pass-thru asset trust securities,
due 12/30/01+ ........................ 3,703,125
3,500,000 Walt Disney Co. (The), 6.375%
senior notes, due 3/30/01 ............ 3,500,000
7,203,125
Paint and Related Products - 1.4%
2,000,000 Sherwin-Williams Co., 6.25%
notes, due 2/1/00 .................... 2,000,000
Pipelines - 1.8%
2,500,000 Enron Corp., 6.45%
notes, due 11/15/01 .................. 2,490,625
Retail - Discount - 3.8%
1,750,000 TJX Companies, Inc., 6.625%
notes, due 6/15/00 ................... 1,754,375
3,500,000 Wal-Mart Stores, Inc., 6.50%
notes, due 6/1/03 .................... 3,482,500
5,236,875
Retail - Leisure Products - 0.4%
500,000 Selmer Company, Inc., 11.00%
senior subordinated notes, due 5/15/05 525,000
Retail - Restaurants - 1.0%
1,400,000 McDonald's Corp., 6.00%
notes, due 6/23/02 ................... 1,379,000
See Notes to Schedules of Investments.
18 Janus Income Funds / October 31, 1999
<PAGE>
SCHEDULE OF INVESTMENTS
Shares or Principal Amount Market Value
- --------------------------------------------------------------------------------
Savings/Loan/Thrifts - 2.8%
$ 2,000,000 Dime Bancorp, Inc., 7.00%
senior notes, due 7/25/01 ............ $ 1,992,500
2,000,000 Golden State Holdings, Inc, 6.75%
senior notes, due 8/1/01 ............. 1,950,000
3,942,500
Super-Regional Banks - 2.7%
3,750,000 NationsBank Corp., 5.75%
senior notes, due 3/15/01 ............ 3,712,500
Telecommunication Equipment - 2.5%
3,500,000 Lucent Technologies, Inc., 6.90%
notes, due 7/15/01 ................... 3,526,250
Telecommunication Services - 0.6%
750,000 Galaxy Telecom L.P., 12.375%
senior subordinated notes, due 10/1/05 800,625
Telephone - Integrated - 0.2%
300,000 NEXTLINK Communications, Inc., 12.50%
senior notes, due 4/15/06 ............ 318,750
Telephone - Local - 3.5%
3,000,000 Southwestern Bell Communications Capital
Corp., 6.375%, notes, due 4/1/01 ..... 2,988,750
1,850,000 US WEST Communications, Inc., 6.375%
notes, due 10/15/02 .................. 1,819,938
4,808,688
Telephone - Long Distance - 3.3%
4,000,000 MCI WorldCom, Inc., 6.125%
senior notes, due 8/15/01 ............ 3,970,000
500,000 Qwest Communications International, Inc.
10.875%, senior notes, due 4/1/07 .... 564,375
4,534,375
Wire and Cable Products - 0.5%
650,000 International Wire Group, Inc., 11.75%
senior subordinated notes, due 6/1/05 661,375
Wireless Equipment - 0.5%
700,000 Nextel Communications, Inc., zero coupon
senior discount notes, due 8/15/04 ... 710,500
- --------------------------------------------------------------------------------
Total Corporate Notes (cost $137,066,153) ................. 135,423,051
- --------------------------------------------------------------------------------
Short-Term Corporate Note - 0.3%
Household Finance Corp.
400,000 5.30%, 11/1/99 (amortized cost $400,000) 400,000
- --------------------------------------------------------------------------------
Total Investments (total cost $137,466,153) - 97.7% ....... 135,823,051
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 2.3% 3,184,532
- --------------------------------------------------------------------------------
Net Assets - 100% ......................................... $ 139,007,583
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 19
<PAGE>
Janus | Money Market Funds
[PHOTO]
Sharon Pichler
portfolio manager
Janus Money Market Fund
Janus Tax-Exempt
Money Market Fund
[PHOTO]
J. Eric Thorderson
portfolio manager
Janus Government
Money Market Fund
For the fiscal year ended October 31, 1999, Janus Money Market Fund ranked 74th
out of 332 funds in the U.S. Money Market Category as tracked by Lipper, Inc., a
leading mutual fund rating company.(1) Janus Government Money Market Fund ranked
30th out of 122 funds in the U.S. Government Money Market category during the
same period,(2) and Janus Tax-Exempt Money Market Fund ranked 15th out of 132
funds in the U.S. Tax-Exempt Money Market category. (3)
With the global economic situation stabilizing, the major factor influencing
money markets this year was the threat of higher U.S. interest rates. While
consumer price increases have remained muted, there are some worrisome signs
that higher inflation could be on the horizon. For example, tight labor markets
have put upward pressure on wage costs, and the dollar's weakness relative to
the Japanese yen has made some imported goods more expensive. Furthermore, with
prices of oil and other raw materials rising, some producers may be forced to
pass along higher costs to their retail customers. These concerns led the
Federal Reserve Board to shift away from its stimulative policy stance of a year
ago, when it cut overnight interest rates three times, embarking on an
aggressive campaign to temper economic growth and head off inflation.
Consequently, the central bank raised interest rates twice this summer and left
open the prospect of additional rate hikes going forward.
While short-term money markets were relatively calm during the first half of the
year, uncertainty over the timing and severity of additional Fed interest rate
increases has recently kept markets on edge. Currently, yields in short-term
money markets reflect a widely held view that central bank policymakers will
raise rates another 25 basis points in November. But the risk is that rates
could move even higher if the Fed does not see concrete signs the economy is
slowing.
The approaching Y2K transition is also adding to money market volatility.
Typically, we anticipate a temporary spike in interest rates at the end of a
calendar year. That's because corporations and individuals temporarily rearrange
their assets to suit different investor needs. This year, however, these
year-end dislocations are expected to be even greater because of investor
uncertainty over the widely discussed millennium date change. We believe this
Y2K effect will be short-lived, without any significant or lasting affect on
financial markets. The Federal Reserve has also assured investors it will supply
whatever liquidity is necessary to keep market functions as normal as can be
expected at the end of any year.
Nonetheless, we have added to our cash holdings to help cushion the Fund from
any unusual volatility. The year-end turbulence is expected to be most evident
in the taxable money markets, which are more sensitive to the threat of Federal
Reserve policy changes. The impact will likely be less pronounced in the
tax-exempt money market, which should experience more typical year-end
volatility.
We also believe these Y2K-related market dislocations will create opportunities
to add yield for our shareholders. For example, we are already seeing money
market securities with mid-January maturities paying substantially higher yields
than money market instruments with mid-December maturities. The difference in
yields is much wider than we typically see, even at year-end. Consequently, we
have extended the maturity of some of our short-term investments to take
advantage of this.
Looking ahead, we are confident that our higher cash position will help cushion
performance from the risk of higher interest rates, while giving us the
flexibility to respond to changing market conditions.
In closing, we'd like to thank you for your continued investment in Janus Money
Market Funds.
(1) Lipper, Inc. defines a U.S. money market fund as one that invests in
"high-quality financial instruments rated in the top two grades with
dollar-denominated average maturities of less than 90 days" and that
intends "to keep constant net asset value." As of October 31, 1999, Janus
Money Market Fund ranked 46/278 of U.S. money market funds for the 3-year
period.
(2) Lipper, Inc. defines a U.S. government money market fund as one that
invests in "high-quality financial instruments issued or guaranteed by the
U.S. government, its agencies or instrumentalities, with dollar-weighted
average maturities of less than 90 days" and that intends "to keep constant
net asset value." As of October 31, 1999, Janus Government Money Market
Fund ranked 25/106 of U.S. government money market funds for the 3-year
period.
(3) Lipper, Inc. defines a tax-exempt money market fund as one that invests in
"high-quality municipal obligations with dollar-weighted average maturities
of less than 90 days" and that intends "to keep constant net asset value."
As of October 31, 1999, Janus Tax-Exempt Money Market Fund ranked 16/124 of
tax-exempt money market funds for the 3-year period.
Lipper rankings are based on total return, including reinvestment of dividends
and capital gains.
An investment in the Fund(s) is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund(s) seeks
to preserve the value of your investment at $1.00 per share, it is possible to
lose money by investing in the Fund(s).
Past performance does not guarantee future results.
20 Janus Income Funds / October 31, 1999
<PAGE>
Janus | Money Market Fund
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 9.6%
$100,000,000 Abbey National Treasury Services, Inc.
5.314%, 12/30/99 ..................... $ 99,129,094
Banque et Caisse D'Epargne de L'etat:
50,000,000 4.83%, 11/15/99 ...................... 49,906,083
50,000,000 6.10%, 1/18/00 ....................... 49,339,166
Bear Stearns Companies, Inc.:
25,000,000 5.85%, 3/2/00 ........................ 24,504,375
25,000,000 5.81%, 3/29/00 ....................... 24,398,826
100,000,000 Fortis Funding L.L.C.
5.345%, 12/29/99 ..................... 99,138,861
50,000,000 Heller Financial, Inc.
5.40%, 11/2/99 ....................... 49,992,500
25,000,000 Morgan Stanley & Co., Inc.
6.07%, 1/20/00 ....................... 24,662,778
35,000,000 Sumitomo Life America, Inc.
6.05%, 2/11/00+ ...................... 34,400,042
100,000,000 Svenska Handelsbanken, New York
5.325%, 12/29/99 ..................... 99,142,083
UBS Financial Corp.:
50,000,000 5.34%, 12/17/99 ...................... 49,658,833
50,000,000 5.32%, 12/22/99 ...................... 49,623,167
- --------------------------------------------------------------------------------
Total Short-Term Corporate Notes
(amortized cost $653,895,808) ........................... 653,895,808
- --------------------------------------------------------------------------------
Taxable Variable Rate Demand Notes - 8.7%
9,800,000 Bannockburn Associates L.L.C.
5.46%, 4/1/27 ........................ 9,800,000
14,980,000 Breckenridge Terrace L.L.C.
5.4087%, 5/1/39 ...................... 14,980,000
20,000,000 Brosis Finance L.L.C.
5.41%, 9/1/19 ........................ 20,000,000
California HFA:
14,445,000 5.46%, 8/1/05+ ....................... 14,445,000
48,995,000 5.46%, 8/1/07 ........................ 48,995,000
20,000,000 Carolina Medi-Plan
5.41%, 6/1/22 ........................ 20,000,000
15,510,000 Crouse Health Hospital, Inc.
5.50%, 7/1/17 ........................ 15,510,000
25,000,000 Crozer-Keystone Health Systems
5.50%, 12/15/21 ...................... 25,000,000
36,530,000 Cuyahoga County, Ohio Continuing Care
Facilities Revenue, 5.55%, 2/1/29 .... 36,530,000
Eagle County, Colorado Housing Facility
Revenue, (BC Housing L.L.C. Project),
Series A:
9,100,000 5.4087%, 6/1/27 ...................... 9,100,000
8,000,000 5.4587%, 5/1/39 ...................... 8,000,000
11,600,000 Episcopal Health Services, Inc., New York
5.50%, 3/1/28 ........................ 11,600,000
15,000,000 Eufaula, Alabama Industrial Development
Board, (Chia Tai Project), 5.56%, 6/1/13 15,000,000
12,600,000 Genesys Michigan Health System, Inc.,
Series A, 5.42%, 4/1/20 .............. 12,600,000
15,000,000 HHH Investment Co.
5.50%, 7/1/29 ........................ 15,000,000
18,150,000 Lenexa, Kansas Industrial Revenue, (Labone,
Inc. Project), Series A, 5.49%, 9/1/09 18,150,000
59,000,000 Los Angeles, California Community
Redevelopment Agency, Series A,
5.50%, 12/1/18 ....................... 59,000,000
20,675,000 Louisiana Health Systems Corp. Revenue,
Series B, 5.45%, 10/1/22 ............. 20,675,000
Taxable Variable Rate Demand Notes - (continued)
$ 34,805,000 Montgomery, Alabama BMC Special Care
Facilities Finance Authority, (Baptist
Medical Center), Series C
5.45%, 11/15/29 ...................... $ 34,805,000
20,000,000 New Grant L.L.C.
5.50%, 7/1/19 ........................ 20,000,000
10,000,000 Patrick Schaumburg Auto
5.50%, 7/1/08 ........................ 10,000,000
37,000,000 Racetrac Capital L.L.C.
5.41%, 4/1/18 ........................ 37,000,000
25,000,000 Rehau, Inc.
5.55%, 10/1/19 ....................... 25,000,000
14,330,000 Rockland Financial, Ltd.
5.46%, 12/1/26 ....................... 14,330,000
14,900,000 St. Francis Place, Ltd.
5.55%, 12/1/08+ ...................... 14,900,000
37,500,000 Texas Veterans Housing Assistance,
Series A, 5.375%, 6/1/30 ............. 37,500,000
5,090,000 Union City, Tennessee Industrial
Development Board,
(Cobank Limited L.L.C., Project),
5.48%, 1/1/25 ........................ 5,090,000
19,995,000 Virginia Housing
5.46%, 1/1/09 ........................ 19,995,000
- --------------------------------------------------------------------------------
Total Taxable Variable Rate Demand Notes (cost $593,005,000) 593,005,000
- --------------------------------------------------------------------------------
Floating Rate Notes - 25.1%
Albertson's, Inc.
75,000,000 5.3862%, 7/14/00+ .................... 74,961,046
American Express Centurion:
50,000,000 5.45%, 11/24/99 ...................... 50,000,000
25,000,000 5.50%, 7/13/00 ....................... 25,000,000
American Honda Finance Corp.:
30,000,000 6.2225%, 1/25/00 ..................... 29,996,577
25,000,000 5.48%, 3/23/00 ....................... 24,998,086
25,000,000 5.4625%, 6/19/00 ..................... 24,992,290
50,000,000 6.1462%, 7/12/00 ..................... 49,989,590
75,000,000 AT&T Corp.
6.1362%, 7/13/00+ .................... 74,962,315
25,000,000 Bank One Corp.
6.115%, 10/5/00 ...................... 24,988,677
30,000,000 Bankers Trust Company, New York
5.45%, 5/15/00 ....................... 29,993,609
75,000,000 Bayerische Landesbank, New York
5.43%, 12/7/99 ....................... 74,997,093
25,000,000 Bear Stearns Companies, Inc.
5.5087%, 11/10/99 .................... 25,000,572
26,000,000 Chase Manhattan Corp.
5.46%, 1/20/00 ....................... 25,996,033
CIT Group, Inc.:
50,000,000 5.43%, 11/2/99 ....................... 49,999,973
100,000,000 5.50%, 2/14/00 ....................... 99,987,579
150,000,000 Comerica Bank, Detroit
5.4187%, 9/8/00 ...................... 150,000,000
50,000,000 Crestar Bank, Richmond
5.50%, 1/28/00 ....................... 49,998,824
30,000,000 Eaton Corp.
6.3112%, 4/17/00+ .................... 30,000,000
First Union National Bank:
50,000,000 5.6062%, 9/27/00 ..................... 50,000,000
50,000,000 5.685%, 10/30/00 ..................... 50,000,000
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 21
<PAGE>
Janus | Money Market Fund
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
Floating Rate Notes - (continued)
Fleet National Bank:
$ 50,000,000 5.44%, 12/6/99 ....................... $ 49,999,607
27,000,000 5.335%, 8/10/00 ...................... 26,989,669
48,000,000 General Motors Acceptance Mortgage Corp.
5.52%, 3/14/00 ....................... 48,001,730
48,000,000 Homeside Lending, Inc.
5.6525%, 8/16/00 ..................... 47,979,418
50,000,000 Landesbank Hessen-Thueringen
6.0687%, 10/2/00 ..................... 49,969,174
100,000,000 Morgan Guaranty Trust Co.
5.45%, 11/29/99 ...................... 100,000,000
50,000,000 National Bank of Commerce
5.4575%, 7/18/00 ..................... 49,987,949
50,000,000 National Rural Utilities
6.0837%, 7/6/00 ...................... 49,986,448
50,000,000 PNC Bank N.A.
5.45%, 11/3/99 ....................... 50,000,000
75,000,000 SouthTrust Bank N.A.
5.4387%, 9/29/00 ..................... 74,947,780
Volkswagen Credit, Inc.:
50,000,000 5.4362%, 6/26/00+ .................... 49,974,287
50,000,000 5.2827%, 8/4/00 ...................... 49,964,411
50,000,000 WestPac Banking Corp.
5.5213%, 9/22/00 ..................... 49,982,186
- --------------------------------------------------------------------------------
Total Floating Rate Notes (amortized cost $1,713,644,923) . 1,713,644,923
- --------------------------------------------------------------------------------
Loan Participations - 4.7%
22,340,000 Amoco Energy Co.
5.41%, 11/10/99+ ..................... 22,340,000
GMAC Mortgage Corp.:
100,000,000 5.4542%, 11/1/99 ..................... 100,000,000
100,000,000 5.41%, 11/15/99+ ..................... 100,000,000
100,000,000 5.4649%, 12/1/99 ..................... 99,544,584
- --------------------------------------------------------------------------------
Total Loan Participations (amortized cost $321,884,584) ... 321,884,584
- --------------------------------------------------------------------------------
Certificates of Deposit - 26.8%
25,000,000 Bank of America, Canada
5.435%, 12/31/99 ..................... 25,000,000
50,000,000 Bank of Montreal, Chicago
5.20%, 5/12/00 ....................... 49,973,573
Bank of Nova Scotia:
50,000,000 5.12%, 2/16/00 ....................... 49,995,763
25,000,000 5.80%, 8/2/00 ........................ 24,990,987
Banque Nationale de Paris:
25,000,000 5.31%, 11/2/99 ....................... 25,000,000
25,000,000 5.32%, 12/15/99 ...................... 25,000,000
50,000,000 4.96%, 12/22/99 ...................... 49,997,304
50,000,000 5.44%, 12/30/99 ...................... 50,000,000
50,000,000 Barclays Bank PLC
5.90%, 10/2/00 ....................... 49,899,791
25,000,000 Bayerische Landesbank, New York
5.93%, 10/2/00 ....................... 24,973,627
25,000,000 Canadian Imperial Bank of Commerce
5.20%, 2/29/00 ....................... 24,997,667
Commerzbank A.G., New York:
30,000,000 5.02%, 2/4/00 ........................ 29,997,741
25,000,000 5.31%, 3/1/00 ........................ 24,997,609
30,000,000 5.09%, 4/12/00 ....................... 29,983,840
25,000,000 5.66%, 6/26/00 ....................... 24,993,752
25,000,000 5.81%, 8/3/00 ........................ 24,990,956
Deutsche Bank, New York:
25,000,000 5.06%, 2/8/00 ........................ 24,997,386
30,000,000 5.21%, 5/10/00 ....................... 29,993,956
25,000,000 5.66%, 6/26/00 ....................... 24,993,752
Certificates of Deposit - (continued)
HSBC Bank USA:
$ 50,000,000 4.93%, 12/15/99 ...................... $ 49,995,929
50,000,000 5.01%, 2/7/00 ........................ 49,994,823
50,000,000 KBC Bank N.V., New York
6.15%, 1/24/00 ....................... 50,000,000
25,000,000 Landesbank Hessen-Thueringen
5.92%, 9/29/00 ....................... 24,971,237
50,000,000 Merita Bank, Ltd., New York
6.17%, 1/21/00 ....................... 50,000,000
National Bank of Canada, New York:
25,000,000 5.065%, 11/18/99 ..................... 24,999,888
25,000,000 5.17%, 4/10/00 ....................... 24,995,754
25,000,000 5.40%, 5/22/00 ....................... 24,995,993
25,000,000 5.56%, 6/5/00 ........................ 24,994,298
25,000,000 5.56%, 6/7/00 ........................ 24,994,244
28,000,000 5.61%, 6/12/00 ....................... 27,993,411
25,000,000 5.80%, 7/28/00 ....................... 24,994,688
25,000,000 NordDeutsche LandesBank, New York
5.22%, 5/15/00 ....................... 24,993,541
25,000,000 Paribas S.A., Japan
5.92%, 1/31/00 ....................... 25,000,619
25,000,000 Regions Bank
6.09%, 10/10/00 ...................... 24,986,517
Royal Bank of Canada, New York:
50,000,000 5.07%, 1/31/00 ....................... 49,997,601
145,000,000 5.12%, 3/21/00 ....................... 144,966,560
Skandinaviska Enskilda Banken:
30,000,000 5.16%, 4/26/00 ....................... 29,992,996
25,000,000 5.47%, 6/2/00 ........................ 24,994,371
25,000,000 5.77%, 8/2/00 ........................ 24,992,787
25,000,000 5.96%, 8/10/00 ....................... 24,992,591
Societe Generale, New York:
50,000,000 5.40%, 11/12/99 ...................... 50,000,000
50,000,000 5.45%, 12/29/99 ...................... 50,000,000
50,000,000 5.45%, 12/31/99 ...................... 50,000,000
Svenska Handelsbanken, New York:
25,000,000 5.22%, 3/1/00 ........................ 24,997,607
35,000,000 5.22%, 5/10/00 ....................... 34,991,187
25,000,000 5.40%, 6/1/00 ........................ 24,992,992
UBS A.G., Stanford:
25,000,000 5.16%, 2/28/00 ....................... 24,996,861
25,000,000 5.40%, 6/1/00 ........................ 24,992,992
25,000,000 5.66%, 6/26/00 ....................... 24,993,752
25,000,000 5.76%, 7/5/00 ........................ 24,993,524
Unibank A/S, New York:
30,000,000 5.22%, 5/15/00 ....................... 29,992,251
25,000,000 5.31%, 5/22/01 ....................... 24,992,650
50,000,000 West Deutsche LandesBank
5.42%, 12/28/99 ...................... 50,000,000
- --------------------------------------------------------------------------------
Total Certificates of Deposit (amortized cost $1,832,569,368) 1,832,569,368
- --------------------------------------------------------------------------------
Promissory Notes - 9.4%
150,000,000 Goldman Sachs Group L.P.
(seven day demand) 5.5475%, 12/3/99 .. 150,000,000
100,000,000 Heller Financial, Inc. (seven day demand)
5.555%, 1/12/00 ...................... 100,000,000
395,000,000 Lehman Brothers, Inc., (same day put)
5.575%, 4/21/14 ...................... 395,000,000
- --------------------------------------------------------------------------------
Total Promissory Notes (cost $645,000,000) ................ 645,000,000
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
22 Janus Income Funds / October 31, 1999
<PAGE>
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
Put Bonds - 0.8%
$ 17,800,000 St. Joseph Health Systems of California,
Series A, 5.47%, 7/1/11+ ............. $ 17,800,000
34,700,331 West Labs, Series 1998 - 1, Class A,
5.41%, 2/25/00 ....................... 34,700,331
- --------------------------------------------------------------------------------
Total Put Bonds (cost $52,500,331) ........................ 52,500,331
- --------------------------------------------------------------------------------
Interest Bearing Notes - 0.4%
15,000,000 General Motors Acceptance Corp. 5.90%,
(medium-term notes), 3/6/00 .......... 15,013,080
13,700,000 General Motors Acceptance Corp., 6.65%,
(medium-term notes), 5/24/00 ......... 13,799,001
- --------------------------------------------------------------------------------
Total Interest Bearing Notes (amortized cost $28,812,081) . 28,812,081
- --------------------------------------------------------------------------------
Bank Notes - 0.3%
25,000,000 European American Bank
5.28%, 5/15/00
(amortized cost $24,995,482) ......... 24,995,482
- --------------------------------------------------------------------------------
Repurchase Agreements - 14.7%
200,000,000 Barclays Capital, Inc., 5.47%, dated
10/29/99, maturing 11/1/99, to be
repurchased at $200,091,167
collateralized by $21,251 in California
Infrastructure PG&G, 6.16%, 6/25/03;
$7,500,000 in Capital One Master Trust,
5.51%-5.5963%, 8/15/00-2/15/05;
$3,500,000 in Caterpillar Financial
Asset Trust, 6.16%, 9/25/03; $1,500,000
in Chase Credit Card Manhattan Auto
Owner Trust, 5.662%, 9/15/04; $4,907,000
in Chase Manhattan RV Owner Trust,
5.80%, 2/17/03; $17,100,000 in Chase
Manhattan RV Owner Trust, 6.37%,
3/15/10; $25,800,000 in CIT RV Trust,
6.25%, 11/15/08; $16,500,000 in Discover
Card Master Trust I, 5.5163%-6.55%,
8/15/00- 9/16/04; $6,500,000 in First
Chicago Master Trust II,
5.5362%-5.5563%, 4/15/03-6/15/05;
$10,350,000 in First USA Credit Card
Master Trust, 5.5088%, 4/18/04;
$61,540,000 in Fleet Credit Card Master
Trust, 5.4463%, 1/15/01; $1,950,000 in
LOOP Funding Master Trust I, 5.67%,
12/26/06; $6,700,000 in MBNA Master
Trust Credit Trust, 6.35%, 12/15/06;
$4,000,000 in NationsBank Credit Card
Master Trust, 5.29%, 2/15/06; $3,000,000
in Nellie Mae, Inc., 5.58%, 12/15/04;
$6,000,000 in People's Bank Credit Card
Master Trust, 5.5563%, 11/15/04;
$5,000,000 in Prime Credit Card Master
Trust, 6.70%, 7/15/04; $6,000,000 in
Providian Master Trust, 5.4962%,
5/15/06; $16,780,000 in Standard Credit
Card Master Trust, 5.95%-8.25%,
9/7/03-11/7/03; with respective values
of $21,230, $7,499,559, $3,090,190,
$1,502,889, $4,838,641, $17,121,888,
$25,612,331, $16,497,694, $6,494,350,
$10,345,135, $61,421,536, $1,903,063,
$6,518,798, $3,995,280, $3,002,070,
$6,003,600, $5,002,565, $5,992,680 and
$17,136,501 .......................... 200,000,000
Repurchase Agreements - (continued)
$ 85,100,000 Deutsche Bank Securities, Inc.,
5.425% dated 10/29/99, maturing 11/1/99,
to be repurchased at $85,138,472
collateralized by $21,248,815 in Fannie
Mae, 5.75%-7.00%, 8/25/07-1/25/29;
$92,262,800 in Freddie Mac, 0%-6.7312%,
3/15/14-4/1/29; with respective values
of $16,844,656 and $69,957,345 ....... $ 85,100,000
360,000,000 Deutsche Bank Securities, Inc.,
5.475% dated 10/29/99, maturing 11/1/99,
to be repurchased at $360,164,250
collateralized by $196,908,000 by Asset
Securitization Corp., 1.03%, 4/14/27;
$9,140,468 in Brazos Student Loan
Finance Corp., 5.48%, 6/1/04;
$237,874,263 in Commercial Mortgage
Acceptance Corp., 0.90%, 12/15/30;
$251,807,500 in Commercial Mortgage
Pass-Through Certificates, 0%, 5/17/32;
$7,569,430 in Discover Card Master Trust
I, 5.6162%, 9/15/02; $117,700,000 in
First Union-Lehman Brothers Commercial
Mortgage, 1.38%, 11/18/27; $10,000,000
in Fremont Small Business Loan Master
Trust, 5.6363%, 4/15/04; $32,951,000 in
GE Capital Services, Inc., 8.5837%,
2/25/28, $256,315,283 in Global
Franchise Trust, 1.839%-6.349%,
4/10/04-6/10/18; $1,362,662,499 in GMAC
Commercial Mortgage Securities, Inc.,
0.38%-6.945%, 5/15/09-5/15/35;
$10,000,000 in Johnson & Johnson
debentures, 8.72%, 11/1/24; $386,160,000
in Merrill Lynch Mortgage Investors,
Inc., 1.34%, 12/26/25; $290,000,000 in
Morgan Stanley Capital I, 0.83%,
7/15/32; $209,056,317 in NationsLink
Funding Corp., 0.74%, 12/20/18;
$15,000,000 in Nellie Mae, Inc., 5.67%,
12/15/18; $34,510,000 in Residential
Funding Mortgage Securities I, 8.79%,
3/25/28; $38,450,000 in Sallie Mae
Trust, 5.349%-5.50%, 10/25/05- 7/27/09;
$16,939,000 in Westam Mortgage Financial
Corp., 0%, 7/26/18; with respective
values of $11,960,181, $9,140,468,
$11,863,775, $8,772,891, $7,570,898,
$8,816,641, $10,000,000, $28,747,174,
$29,825,205, $104,859,809, $11,417,941,
$21,156,157, $12,951,700, $10,751,375,
$14,547,600, $29,558,505, $24,529,191
and $10,731,486 ...................... 360,000,000
360,000,000 NationsBank Corp.,
5.47% dated 10/29/99, maturing 11/1/99,
to be repurchased at $360,164,100
collateralized by $3,340,000 in Amresco
Residential Securities Mortgage Loan
Trust, 6.245%, 4/25/22; $144,606,000 in
Bank of America Mortgage Securities,
0%-6.75%, 7/25/14-9/25/29; $1,595,000 in
Centex Home Equity, 6.04%, 6/25/30;
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 23
<PAGE>
Janus | Money Market Fund
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
Repurchase Agreements - (continued)
$1,806,000 in Contimortgage Home Equity
Loan Trust, 5.5663%, 5/15/13; $3,458,175
in Countrywide Asset-Backed
Certificates, 5.56%, 5/25/29;
$14,683,000 in Countrywide Mortgage
Backed Securities, Inc., 6.50%, 1/25/24;
$500,000 in Delta Funding Home Equity
Loan Trust, 5.95%, 10/15/12; $28,520,000
in DLJ Commercial Mortgage Corp., 0%,
2/15/08; $8,582,000 in EQCC Home Equity
Loan Trust, 5.6363%-7.067%,
6/25/11-7/20/28; $5,000,000 in First
Union Commercial Mortgage Trust, 6.07%,
10/15/35; $38,206,000 in First Union
Residential Securitization Trust, 6.90%,
4/25/25; $3,321,000 in GE Capital
Mortgage Services, Inc., 10.00%,
12/25/23; $22,462,000 in GMAC Commercial
Mortgage Securities, Inc., 6.42%,
5/15/35; $500,000 in Green Tree Home
Improvement Loan Trust, 5.96%, 8/15/29;
Independent National Mortgage Corp.,
5.6087%, 10/25/28; $3,000,000 in
Metropolitan Asset Funding, Inc.,
6.382%, 4/20/13; $40,231,000 in Morgan
Stanley Capital I, 6.25%-6.54%,
3/15/30-11/15/30; $8,966,000 in Mortgage
Capital Funding, Inc., 1.366%-6.66%,
11/20/27; $22,511,532 in NationsLink
Funding Corp., 6.096%- 7.515%,
12/10/01-8/20/30; $114,593,000 in
Residential Asset Securitization Trust,
6.75%-7.25%, 11/25/27-8/25/28;
$2,864,000 in The Money Store Home
Equity Trust, 6.945%-7.69%, 8/15/20-
1/15/39; with respective values of
$3,324,449, $132,351,326, $1,566,167,
$651,684, $3,223,257, $13,912,113,
$491,239, $26,623,420, $3,720,995,
$4,596,294, $18,138,915, $2,275,117,
$20,979,845, $493,400, $653,314,
$2,980,260, $37,059,095, $5,630,780,
$22,016,611, $63,678,894, $2,832,822 . $ 360,000,000
- --------------------------------------------------------------------------------
Total Repurchase Agreements (cost $1,005,100,000) ......... 1,005,100,000
- --------------------------------------------------------------------------------
Total Investments (total cost $6,871,407,577) - 100.5% .... 6,871,407,577
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (0.5%) (34,600,086)
- --------------------------------------------------------------------------------
Net Assets - 100% ......................................... $6,836,807,491
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
24 Janus Income Funds / October 31, 1999
<PAGE>
Janus | Government Money Market Fund
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
U.S. Government Agency Notes - 19.3%
Fannie Mae:
$ 10,000,000 5.625%, 1/21/00 ...................... $ 9,873,438
5,000,000 5.41%, 2/7/00 ........................ 4,926,364
5,000,000 4.72%, 2/8/00 ........................ 4,935,100
10,000,000 5.45%, 3/1/00 ........................ 9,816,819
5,000,000 5.10%, 3/16/00 ....................... 5,000,000
15,000,000 5.10%, 5/19/00 ....................... 14,989,918
5,000,000 5.11%, 5/22/00 ....................... 4,999,723
5,000,000 5.50%, 7/3/00 ........................ 4,812,847
10,000,000 5.40%-5.485%, 7/7/00 ................. 9,623,560
Federal Farm Credit Bank:
5,740,000 4.75%, 2/22/00 ....................... 5,654,418
5,000,000 4.81%, 5/9/00 ........................ 4,873,070
Federal Home Loan Bank System:
5,000,000 4.79%, 2/17/00 ....................... 4,928,150
5,000,000 4.95%, 2/24/00 ....................... 4,995,615
6,140,000 5.05%, 2/25/00 ....................... 6,140,000
10,000,000 5.10%, 3/3/00 ........................ 9,997,781
10,000,000 5.16%, 3/8/00 ........................ 9,999,661
5,000,000 5.52%, 3/22/00 ....................... 4,891,133
5,000,000 4.785%, 3/30/00 ...................... 4,900,313
5,000,000 5.62%, 4/26/00 ....................... 4,861,842
Freddie Mac:
3,419,000 5.05%, 12/30/99 ...................... 3,390,703
5,000,000 5.24%, 1/18/00 ....................... 4,943,233
5,000,000 5.51%, 1/28/00 ....................... 4,932,656
5,000,000 5.44%, 2/18/00 ....................... 4,917,645
8,157,000 5.47%, 2/24/00 ....................... 8,014,468
10,000,000 5.03%, 5/25/00 ....................... 9,712,172
10,000,000 5.22%, 6/2/00 ........................ 9,689,700
5,000,000 5.13%, 6/6/00 ........................ 4,844,675
5,000,000 5.22%, 6/8/00 ........................ 4,840,500
5,000,000 5.29%, 6/13/00 ....................... 4,834,688
10,000,000 5.218%-5.285%, 6/15/00 ............... 9,668,864
10,000,000 5.45%, 7/11/00 ....................... 9,616,986
5,000,000 5.38%, 7/13/00 ....................... 4,809,458
5,000,000 5.46%, 8/4/00 ........................ 4,789,942
Sallie Mae
8,000,000 4.95%, 5/18/00 ....................... 7,781,100
- --------------------------------------------------------------------------------
Total U.S. Government Agency Notes
(amortized cost $227,006,542) ........................... 227,006,542
- --------------------------------------------------------------------------------
U.S. Government Agency Variable Notes - 22.2%
Fannie Mae:
$ 10,000,000 5.23375%, 6/23/00 .................... $ 9,996,148
10,000,000 5.675%, 7/21/00 ...................... 9,997,844
10,000,000 5.2175%, 8/2/00 ...................... 9,994,928
10,000,000 5.18375%, 8/4/00 ..................... 9,995,459
10,000,000 5.2175%, 8/4/00 ...................... 9,994,513
10,000,000 5.1875%, 8/9/00 ...................... 9,992,773
10,000,000 5.37%, 8/9/00 ........................ 9,996,148
Federal Farm Credit Bank:
20,000,000 5.35%, 12/28/99 ...................... 20,000,000
10,000,000 5.31%, 6/22/00 ....................... 9,997,492
10,000,000 5.385%, 9/15/00 ...................... 9,997,871
Federal Home Loan Bank System:
10,000,000 5.32%, 1/19/00 ....................... 9,999,363
15,000,000 5.30%, 4/5/00 ........................ 14,996,867
5,000,000 5.605%, 4/7/00 ....................... 4,999,154
5,000,000 5.655%, 4/24/00 ...................... 4,999,303
5,000,000 5.685%, 4/28/00 ...................... 4,999,022
10,000,000 5.31%, 6/21/00 ....................... 9,997,503
10,000,000 5.267%, 9/21/00 ...................... 9,997,377
5,000,000 5.25875%, 9/28/00 .................... 4,997,324
10,000,000 5.25%, 10/4/00 ....................... 9,995,897
15,000,000 5.924%, 10/4/00 ...................... 14,990,474
15,000,000 5.38%, 10/10/00 ...................... 14,991,598
10,000,000 5.209%, 10/25/00 ..................... 9,988,396
Freddie Mac:
15,000,000 5.2125%, 5/18/00 ..................... 14,993,475
5,000,000 5.645%, 7/14/00 ...................... 4,998,251
Sallie Mae:
5,000,000 5.795%, 2/14/00 ...................... 4,999,155
10,000,000 5.795%, 8/4/00 ....................... 9,991,475
- --------------------------------------------------------------------------------
Total U.S. Government Agency Variable Notes
(amortized cost $259,897,810) ........................... 259,897,810
- --------------------------------------------------------------------------------
U.S. Government Guarantee Notes and Loans - 15.9%
Washington Aircraft Hire
(Export-Import Bank of the United States)
186,601,976 5.34%, 11/5/99 (cost $186,601,976) ... 186,601,976
- --------------------------------------------------------------------------------
U.S. Government Guarantee Variable Notes and Loans - 2.1%
Army and Air Force Exchange
25,000,000 5.51125%, 9/1/00+ (cost $25,000,000) . 25,000,000
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 25
<PAGE>
Janus | Government Money Market Fund
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
Repurchase Agreements - 40.4%
$107,800,000 ABN AMRO Securities, Inc., 5.28%,
dated 10/29/99, maturing 11/1/99, to be
repurchased at $107,847,432
collateralized by $44,689,211 in Fannie
Mae, 6.188%-7.50%, 11/25/08-8/25/29;
$68,523,047 in Freddie Mac, 6.25%-
7.028%, 12/1/18-10/1/29; $7,989,000 in
U.S. Treasury Bills, 4.37%, 12/2/99;
with respective values of $40,281,680,
$61,718,320 and $7,956,557 ........... $ 107,800,000
150,000,000 Credit Suisse First Boston, Inc., 5.425%,
dated 10/29/99, maturing 11/1/99, to be
repurchased at $150,067,813
collateralized by $19,822,959 in Fannie
Mae, 6.00%-8.00%, 10/25/26-10/25/29;
$122,870,513 in Freddie Mac, 6.00%-
8.00%, 2/15/14-10/17/29; $88,850,820 in
Ginnie Mae, 5.9075%-7.00%,
10/16/21-5/20/28; with respective values
of $14,253,567, $56,852,888 and
$83,416,655 .......................... 150,000,000
215,900,000 Deutsche Bank Securities, Inc., 5.425%
dated 10/29/99, maturing 11/1/99, to be
repurchased at $215,997,605
collateralized by $53,908,569 in Fannie
Mae, 5.75%-7.00%, 8/25/07-1/25/29;
$234,072,133 in Freddie Mac, 0%-6.7312%,
3/15/14-4/1/29; with respective values
of $42,735,149 and $177,482,852 ...... 215,900,000
- --------------------------------------------------------------------------------
Total Repurchase Agreements (cost $473,700,000) ........... 473,700,000
- --------------------------------------------------------------------------------
Total Investments (cost $1,172,206,328) - 99.9% ........... 1,172,206,328
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 0.1% 1,229,030
- --------------------------------------------------------------------------------
Net Assets - 100% ......................................... $1,173,435,358
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
26 Janus Income Funds / October 31, 1999
<PAGE>
Janus | Tax-Exempt Money Market Fund
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
Municipal Securities - 99.5%
Alabama - 1.9%
$ 4,600,000 Columbia Industrial Development Board
Pollution Control Revenue, (Alabama
Power Co. Project), Series A, Variable
Rate, 3.60%, 6/1/22 .................. $ 4,600,000
800,000 North Alabama Environmental
Improvement Authority Pollution Control
Revenue, (Reynolds Metals), Variable Rate,
3.65%, 12/1/00 ....................... 800,000
5,400,000
Arizona - 2.3%
1,000,000 Pinal County Industrial Development
Authority Hospital Revenue, (Casa
Grande Regional Medical Center),
Variable Rate, 3.60%, 12/1/22 ........ 1,000,000
5,487,000 Tucson Industrial Development Authority
Multifamily Revenue, (Freedom Park
Apartment Project), Variable Rate,
5.10%, 12/1/07 ....................... 5,487,000
6,487,000
Arkansas - 0.8%
2,300,000 Fayetteville Public Facilities Board Revenue,
(Butterfield Trail Village), Variable Rate,
3.50%, 9/1/27 ........................ 2,300,000
California - 2.1%
Los Angeles Regional Airports Improvement
Corp. Lease Revenue, (American
Airlines - L.A. International):
200,000 Series A, Variable Rate, 3.65%, 12/1/24 200,000
500,000 Series B, Variable Rate, 3.65%, 12/1/24 500,000
500,000 Series C, Variable Rate, 3.65%, 12/1/24 500,000
1,300,000 Series E, Variable Rate, 3.65%, 12/1/24 1,300,000
100,000 Series G, Variable Rate, 3.65%, 12/1/24 100,000
3,600,000 Series 2, Variable Rate, 3.65%, 12/1/25 3,600,000
6,200,000
Colorado - 5.2%
1,585,000 Aurora Centretech Metropolitan District,
Series A, Variable Rate, 3.40%, 12/1/28 1,585,000
2,430,000 Centennial Downs Metropolitan District,
Variable Rate, 3.60%, 12/1/18 ........ 2,430,000
7,425,000 Denver City and County Multi-Family
Housing Revenue, (Ogden Residences
Project), Variable Rate, 3.60%, 12/1/09 7,425,000
1,000,000 Dove Valley Metropolitan District Arapahoe
County, Series B, 3.95%, 11/1/25 ..... 1,000,000
1,000,000 Interstate South Metropolitan District,
Series B, 3.95%, 11/1/14 ............. 1,000,000
1,555,000 Stapleton Business Center Metropolitan
District, 3.35%, 12/1/17 ............. 1,555,000
14,995,000
Florida - 4.1%
5,000,000 Gulf Breeze Healthcare Facilities Revenue,
(Heritage Healthcare Project), Variable
Rate, 3.62%, 1/1/24+ ................. 5,000,000
5,000,000 Palm Beach County Educational Facilities
Authority Revenue, (Atlantic College
Project), Variable Rate, 3.65%, 12/1/12 5,000,000
1,800,000 St. Johns County Housing Finance
Authority Housing Revenue, (Multifamily),
Variable Rate, 3.45%, 2/15/28 ........ 1,800,000
11,800,000
Georgia - 3.6%
$ 400,000 Burke County Development Authority
Pollution Control Revenue, (Georgia
Power Company Plant Vogtle), Variable
Rate, 3.50%, 7/1/24 .................. $ 400,000
3,800,000 Gwinnett County Hospital Authority
Revenue Anticipation Certificates,
(Gwinnett Hospital System Income
Project), Series B, Variable Rate,
3.50%, 9/1/27 ........................ 3,800,000
5,000,000 South Georgia Hospital Authority Revenue,
(Georgia Alliance Community Hospitals),
Series A, Variable Rate, 3.60%, 4/1/29 5,000,000
1,000,000 Whitfield County Residential Care Facility
for the Elderly Authority, (Royal Oaks
Senior Living Community), Variable Rate,
3.60%, 11/1/25 ....................... 1,000,000
10,200,000
Hawaii - 0.8%
2,100,000 Hawaii, Series BS, 7.125%, 9/1/10 ...... 2,179,331
Illinois - 12.9%
1,485,000 Chicago, (Emergency Telephone System),
4.50%, 1/1/00 ........................ 1,487,885
2,600,000 Chicago Metropolitan Water Reclamation
District - Greater Chicago, 4.70%, 12/1/99 2,603,441
5,500,000 Chicago Tax Increment, Series B, Variable
Rate, 3.60%, 12/1/14 ................. 5,500,000
1,395,000 Cook County Illinois School District
(No. 069) Skokie, 3.15%, 12/1/99 ..... 1,395,000
1,000,000 Du Page Water Commission, 5.85%, 3/1/00 1,008,712
1,000,000 Illinois, 5.375%, 5/1/00 ............. 1,009,325
5,000,000 Illinois Development Finance Authority
Revenue, (Local Government Financing
Program), Series B, Variable Rate,
3.60%, 9/1/29 ........................ 5,000,000
Illinois Health Facilities Authority Revenue,
(Swedish Covenant Hospital Project):
8,900,000 Variable Rate, 3.55%, 8/1/25 ......... 8,900,000
4,600,000 Series A, Variable Rate, 3.55%, 8/15/29 4,600,000
2,955,000 Lombard Multifamily Housing (Clover
Creek), 3.55%, 12/15/06 .............. 2,955,000
2,400,000 Northlake Economic Development Revenue,
(Dominick's Foods), Subseries B, Variable
Rate, 3.80%, 1/1/02 .................. 2,400,000
36,859,363
Indiana - 1.7%
1,000,000 Indiana State University Revenue Building 3,
(Student Fee), Series E, 7.375%, 10/1/10 1,037,041
1,000,000 Logansport Economic Development Revenue,
(Modine Manufacturing Co.), Variable
Rate, 3.55%, 1/1/08 .................. 1,000,000
2,780,000 Winchester Revenue, (Hoosier Care II, Inc.),
10.375%, 6/1/20 ...................... 2,960,948
4,997,989
Iowa - 4.4%
Buffalo Pollution Control Revenue,
(LaFarge Corp. Project):
2,700,000 Series A, Variable Rate, 3.85%, 10/1/00 2,700,000
1,250,000 Series B, Variable Rate, 3.85%, 10/1/10 1,250,000
8,670,000 Iowa Higher Education Loan Authority
Revenue, (Palmer Chiropractic), Variable
Rate, 3.60%, 4/1/27 .................. 8,670,000
12,620,000
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 27
<PAGE>
Janus | Tax-Exempt Money Market Fund
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
Kansas - 1.4%
$ 600,000 Kansas Development Finance Authority
Health Facilities Revenue, (Stormont-Vail
HealthCare, Inc.), Series M, Variable Rate,
3.55%, 11/15/23 ...................... $ 600,000
3,400,000 Wichita Revenue, (CSJ Health System of
Wichita), Variable Rate, 4.00%, 10/1/11 3,400,000
4,000,000
Kentucky - 0.4%
1,100,000 Kentucky Economic Development Finance
Authority Hospital Facilities Revenue,
(Health Alliance), Series C, Variable Rate,
3.45%, 1/1/22 ........................ 1,100,000
Louisiana - 3.1%
1,050,000 Ascension Parish Pollution Control Revenue,
(Borden, Inc. Project), Variable Rate,
3.50%, 12/1/09 ....................... 1,050,000
5,300,000 Louisiana Public Facilities Authority
Revenue, (River View), Variable Rate,
3.60%, 7/1/27 ........................ 5,300,000
1,800,000 Oucahita Parish Industrial Development
Revenue, (McRae's, Inc. Project),
Variable Rate, 4.10%, 7/1/04 ......... 1,800,000
800,000 South Louisiana Port Community Port
Revenue, (Occidental Petroleum),
Variable Rate, 3.50%, 7/1/18 ......... 800,000
8,950,000
Maryland - 1.0%
3,000,000 Montgomery County Housing Opportunities
Common Housing Revenue, Series A,
Variable Rate, 3.50%, 7/15/07 ........ 3,000,000
Massachusetts - 0.7%
2,000,000 Massachusetts Water Reservoir Authority,
Series A, 7.50%, 4/1/00 .............. 2,075,099
Michigan - 2.2%
6,300,000 Holland Economic Development Corp.,
(Thrifty Holland, Inc.), Variable Rate,
4.20%, 3/1/13 ........................ 6,300,000
Minnesota - 4.3%
3,800,000 Cohasset Revenue, (Minnesota Power and
Light Co. Project), Series B, Variable Rate,
3.50%, 6/1/13 ........................ 3,800,000
4,100,000 Golden Valley Industrial Development
Revenue, (Unicare Homes, Inc. Project),
Variable Rate, 3.50%, 9/1/14 ......... 4,100,000
1,000,000 Minnesota Rural Water Finance Corp.,
(Public Projects Construction Notes),
4.25%, 9/1/00 ........................ 1,002,381
600,000 New Brighton Industrial Development
Revenue, (Unicare Homes, Inc. Project),
Variable Rate, 3.50%, 12/1/14 ........ 600,000
2,900,000 Robbinsdale Industrial Development
Revenue, (Unicare Homes, Inc. Project),
Variable Rate, 3.50%, 10/1/14 ........ 2,900,000
12,402,381
Mississippi - 2.9%
500,000 Jackson, Series A, 5.20%, 5/1/00 ....... 504,601
835,000 Mississippi Board of Trustees of
Institutions of Higher Learning,
Series A, 3.15%, 1/15/00+ ............ 835,000
7,000,000 Mississippi Business Finance Corp.
Revenue, (Mississippi College Project),
Series B, Variable Rate, 3.60%, 2/1/09 7,000,000
8,339,601
Missouri - 3.0%
$ 1,900,000 Kansas City Industrial Development
Authority Revenue, (Ewing Marion
Kauffman), Series A, Variable Rate,
3.55%, 4/1/27 ........................ $ 1,900,000
3,250,000 Missouri Health and Educational Facilities
Authority School District Advance
Funding Project, (Jasper County School
District), Series G, 4.25%, 9/19/00 .. 3,263,754
1,300,000 Missouri State Health and Educational
Facilities Authority Revenue, (The
Washington University), Variable Rate,
Series C, 3.55%, 9/1/30 .............. 1,300,000
2,130,000 St. Louis, (Public Safety), 4.00%, 2/15/00 2,133,030
8,596,784
Nebraska - 0.4%
1,205,000 Lancaster County, 4.00%, 11/15/00 ...... 1,207,387
Nevada - 0.8%
1,000,000 Las Vegas, (Clark County Library District),
Series A, 6.35%, 6/1/00 .............. 1,016,139
1,300,000 Reno Hospital Revenue, (St. Mary's Regional
Medical Center), Series B, Variable Rate,
3.65%, 5/15/23 ....................... 1,300,000
2,316,139
New Mexico - 0.9%
2,695,000 New Mexico Highway Community Tax
Revenue, Series B, 4.25%, 6/15/00 .... 2,705,868
New York - 2.6%
1,050,000 Long Island Power Authority Electric
System Revenue, Series 6, Variable Rate,
3.65%, 5/1/33 ........................ 1,050,000
6,300,000 New York State Dormitory Authority
Revenue, (St. Francis Center at the
Knolls), Variable Rate, 3.70%, 7/1/23 6,300,000
7,350,000
North Carolina - 0.3%
900,000 Wake County Industrial Facilities and
Pollution Control Financing Authority
Revenue, (Carolina Power and Light Co.
Project), Series A, Variable Rate, 3.60%,
6/15/14 .............................. 900,000
North Dakota - 0.5%
300,000 Grand Forks Health Care Facilities
Revenue, (United Hospital Obligation
Group Project), Series A, Variable Rate,
3.65%, 12/1/25 ....................... 300,000
1,000,000 Grand Forks Hospital Facilities Revenue,
(United Hospital Obligation Group
Project), Variable Rate, 3.65%, 12/1/16 1,000,000
1,300,000
Ohio - 3.3%
1,000,000 Champaign County Industrial Development
Revenue, (Allied-Signal, Inc.), Variable
Rate, 3.60%, 11/1/07 ................. 1,000,000
2,000,000 Clinton County Hospital Revenue, (Ohio
Hospital Capital, Inc.), Variable Rate,
3.60%, 6/1/28 ........................ 2,000,000
1,600,000 Hamilton County Health Systems Revenue,
(Franciscan Sisters of the Poor), Series A,
Variable Rate, 3.75%, 3/1/17 ......... 1,600,000
3,750,000 Indian Hill Economic Development Revenue,
(Cincinnati Country Day School),
Variable Rate, 3.50%, 5/1/19 ......... 3,750,000
1,000,000 Marysville Exempt Village School District,
(Bond Anticipation Notes), 3.61%, 6/1/00 1,001,744
9,351,744
See Notes to Schedules of Investments.
28 Janus Income Funds / October 31, 1999
<PAGE>
SCHEDULE OF INVESTMENTS
Principal Amount Market Value
- --------------------------------------------------------------------------------
Oklahoma - 0.3%
$ 800,000 Oklahoma City Industrial and Cultural
Facilities Trust Revenue, (Oklahoma
Christian College), Variable Rate, 3.80%,
7/1/15 ............................... $ 800,000
Oregon - 0.1%
400,000 Port of Portland Pollution Control, (Reynolds
Metals), Variable Rate, 3.65%, 12/1/09 400,000
Pennsylvania - 4.5%
1,000,000 Allegheny County Hospital Development
Authority Revenue, (South Hills Health
System), Variable Rate, 3.15%, 4/1/08 1,000,000
5,785,000 Dauphin County General Authority, (Allied
Health Pooled Financing Program),
Series B, Variable Rate, 3.60%, 10/1/27 5,785,000
2,900,000 Pennsylvania Higher Educational Facilities
Authority Revenue, (CICU Financing
Program), Series B2, 3.80%, 11/1/17 .. 2,900,000
1,800,000 South Fork Municipal Authority Hospital
Revenue, (Conemaugh Health System),
Series A, Variable Rate, 3.65%, 7/1/28 1,800,000
1,300,000 Venango Industrial Development Authority,
(Pennzoil Co. Project), Variable Rate,
3.80%, 12/1/12 ....................... 1,300,000
12,785,000
South Carolina - 0.3%
800,000 South Carolina Educational Facilities
Authority For Private Nonprofit
Institutions, (Furman University Project),
Series B, Variable Rate, 3.50%, 10/1/26 800,000
Tennessee - 1.1%
200,000 Hamilton County Industrial Development
Board Industrial Development Revenue,
(Komatsu America Manufacturing Project),
Variable Rate, 5.45%, 11/1/05 ........ 200,000
Metropolitan Nashville Airport Authority
Special Facilities Revenue, (American
Airlines Project):
400,000 Series A, Variable Rate, 3.65%, 10/1/12 400,000
410,000 Series B, Variable Rate, 3.65%, 10/1/12 410,000
2,000,000 Signal Mountain Health Education, (Alexian
Village), Variable Rate, 3.30%, 1/1/28 2,000,000
3,010,000
Texas - 9.9%
Grapevine Industrial Development Corp.
Revenue, (American Airlines):
200,000 Series A-1, Variable Rate, 3.65%, 12/1/24 200,000
300,000 Series A-2, Variable Rate, 3.65%, 12/1/24 300,000
1,100,000 Series A-3, Variable Rate, 3.65%, 12/1/24 1,100,000
700,000 Series A-4, Variable Rate, 3.65%, 12/1/24 700,000
500,000 Series B-1, Variable Rate, 3.65%, 12/1/24 500,000
400,000 Series B-2, Variable Rate, 4.25%, 12/1/24 400,000
700,000 Series B-3, Variable Rate, 3.65%, 12/1/24 700,000
300,000 Harris County Health Facilities Development
Corp. Revenue, (St. Luke's Episcopal
Hospital), Series B, Variable Rate,
3.65%, 2/15/27 ....................... 300,000
8,700,000 Harris County Industrial Development Corp.
Revenue, (Baytank Houston, Inc. Project),
Variable Rate, 3.40%, 2/1/20 ......... 8,700,000
Lone Star Airport Improvement Authority:
700,000 Series A-2, Variable Rate, 3.65%, 12/1/14 700,000
200,000 Series A-4, Variable Rate, 3.65%, 12/1/14 200,000
300,000 Series B-2, Variable Rate, 3.65%, 12/1/14 300,000
400,000 Series B-3, Variable Rate, 3.65%, 12/1/14 400,000
1,700,000 Lower Neches Valley Authority, (Neches
River Treatment Project), Variable Rate,
3.50%, 2/1/04 ........................ 1,700,000
Texas - (continued)
$ 700,000 North Central Health Facility Development
Corp. Revenue, (Presbyterian Medical
Center), Series D, Variable Rate, 3.65%,
12/1/15 .............................. $ 700,000
2,915,000 San Antonio Independent School District,
4.00%, 8/15/00 ....................... 2,920,695
1,000,000 San Antonio Water Revenue,
zero coupon, 5/1/01 .................. 959,426
3,000,000 Texas, (Tax and Revenue Anticipation
Notes), Series A, 4.50%, 8/31/00 ..... 3,019,264
3,440,000 Texas University System, (Constitutional
Appropriation), 4.50%, 8/15/00 ....... 3,466,228
1,000,000 Trinity River Authority Pollution Control
Revenue, (LaFarge Corp. Project), Variable
Rate, 3.65%, 6/1/02 .................. 1,000,000
28,265,613
Utah - 0.2%
630,000 Springville Electric Revenue Refunding,
3.20%, 3/1/00 ........................ 630,000
Virginia - 3.1%
Suffolk Redevelopment and Housing
Authority Multi-Family Housing Revenue:
4,133,000 (Rental-Windsor Fieldstone),
Variable Rate, 4.10%, 12/1/07 ........ 4,133,000
4,778,000 (Rental-Windsor Potomac),
Variable Rate, 4.10%, 12/1/07 ........ 4,778,000
8,911,000
Washington - 10.2%
1,000,000 King County School District (No. 412)
Shoreline Refunding, 4.50%, 12/1/99 .. 1,001,163
Washington Housing Finance Commission:
1,400,000 Multifamily Mortgage Revenue,
(Mills Plain Crossing Project), Variable
Rate, 4.05%, 1/1/10 .................. 1,400,000
Nonprofit Housing Revenue:
7,300,000 (Emerald Heights Project),
Variable Rate, 3.55%, 1/1/21 ......... 7,300,000
3,050,000 (Golden Sands Project), Variable
Rate, 3.45%, 7/1/29 .................. 3,050,000
11,645,000 (Panorama City Project), Variable Rate,
3.70%, 1/1/27 ........................ 11,645,000
1,055,000 (YMCA Greater Seattle), Variable Rate,
3.55%, 7/1/11 ........................ 1,055,000
2,000,000 Washington Public Power Supply System
Nuclear Project (No. 3) Revenue, Series B,
7.25%, 7/1/15 ........................ 2,052,625
1,810,000 Washington State Health Care Facilities
Authority Revenue, (Virginia Mason
Medical Center), Series B, Variable Rate,
3.45%, 2/15/27 ....................... 1,810,000
29,313,788
Wisconsin - 2.2%
2,600,000 Brown Deer School District, (Tax and
Revenue Anticipation Prommisory Notes),
4.05%, 10/27/00 ...................... 2,603,696
2,750,000 Rhinelander School District, (Tax and
Revenue Anticipation Promissory Notes),
4.10%, 9/28/00 ....................... 2,757,203
1,000,000 Wisconsin Health and Educational Facilities
Authority Revenue, (Riverview Hospital
Association), Series B, Variable Rate,
3.60%, 10/1/26 ....................... 1,000,000
6,360,899
- --------------------------------------------------------------------------------
Total Investments (total cost $285,209,986) - 99.5% ....... 285,209,986
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 0.5% 1,352,167
- --------------------------------------------------------------------------------
Net Assets - 100% ......................................... $ 286,562,153
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
Janus Income Funds / October 31, 1999 29
<PAGE>
Statements of | Operations - Bond Funds
<TABLE>
<CAPTION>
Janus Janus
Janus Janus Federal Short-Term
For the fiscal year ended October 31, 1999 Flexible Income High-Yield Tax-Exempt Bond
(all numbers in thousands) Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------
Investment Income:
<S> <C> <C> <C> <C>
Interest $ 91,844 $ 28,016 $ 5,567 $ 8,482
Dividends 1,138 100 -- --
- ------------------------------------------------------------------------------------------------------------------------
92,982 28,116 5,567 8,482
- ------------------------------------------------------------------------------------------------------------------------
Expenses:
Advisory fees 7,264 2,218 614 883
Transfer agent fees and expenses 2,379 590 211 296
Registration fees 261 96 99 97
Postage and mailing expenses 85 31 11 18
Custodian fees 132 53 35 36
Printing expenses 159 46 20 39
Audit fees 17 34 19 11
Trustees' fees and expenses 4 8 5 3
Other expenses 40 24 16 19
- ------------------------------------------------------------------------------------------------------------------------
Total Expenses 10,341 3,100 1,030 1,402
- ------------------------------------------------------------------------------------------------------------------------
Expense and Fee Offsets (148) (58) (12) (14)
- ------------------------------------------------------------------------------------------------------------------------
Net Expenses 10,193 3,042 1,018 1,388
- ------------------------------------------------------------------------------------------------------------------------
Less: Excess Expense Reimbursement -- (76) (352) (505)
- ------------------------------------------------------------------------------------------------------------------------
Net Expenses after Expense Reimbursement 10,193 2,966 666 883
- ------------------------------------------------------------------------------------------------------------------------
Net Investment Income 82,789 25,150 4,901 7,599
- ------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized Gain/(Loss) on Investments:
Net realized gain/(loss) from securities transactions (30,419) (16,855) (1,401) (1,416)
Net realized gain/(loss) from foreign currency transactions (91) (2) -- --
Net realized gain/(loss) from futures and/or options contracts 5,363 -- (54) 32
Change in net unrealized appreciation or depreciation
of investments and foreign currency (40,980) 11,471 (7,923) (2,037)
- ------------------------------------------------------------------------------------------------------------------------
Net Gain/(Loss) on Investments (66,127) (5,386) (9,378) (3,421)
- ------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting from Operations $ 16,662 $ 19,764 $ (4,477) $ 4,178
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
30 Janus Income Funds / October 31, 1999
<PAGE>
Statements of | Assets & Liabilities - Bond Funds
<TABLE>
<CAPTION>
Janus Janus
As of October 31, 1999 Janus Janus Federal Short-Term
(all numbers in thousands except Flexible Income High-Yield Tax-Exempt Bond
net asset value per share) Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------------
Assets:
<S> <C> <C> <C> <C>
Investments at cost $ 1,284,795 $ 269,025 $ 99,910 $ 137,466
- ------------------------------------------------------------------------------------------------------
Investments at value $ 1,259,779 $ 258,534 $ 94,187 $ 135,823
- ------------------------------------------------------------------------------------------------------
Cash 220 1,161 -- 84
Receivables:
Investments sold 16,028 4,839 960 4,189
Fund shares sold 2,103 947 248 1,293
Interest 25,283 6,922 1,969 2,662
Other assets 5 2 1 --
Forward currency contracts 458 -- -- --
- ------------------------------------------------------------------------------------------------------
Total Assets 1,303,876 272,405 97,365 144,051
- ------------------------------------------------------------------------------------------------------
Liabilities:
Payables:
Due to custodian -- -- 883 --
Investments purchased 16,916 6,719 -- 4,020
Fund shares repurchased 3,727 563 82 849
Dividends 931 402 78 56
Advisory fee 625 163 29 49
Transfer agent fee 197 35 14 21
Accrued expenses 203 47 47 48
Variation margin - futures contracts 1,037 -- 33 --
Swap spread lock agreements 842 -- -- --
- ------------------------------------------------------------------------------------------------------
Total Liabilities 24,478 7,929 1,166 5,043
- ------------------------------------------------------------------------------------------------------
Net Assets $ 1,279,398 $ 264,476 $ 96,199 $ 139,008
Shares Outstanding, $0.01 Par Value
(unlimited shares authorized) 136,845 26,374 14,453 49,035
- ------------------------------------------------------------------------------------------------------
Net Asset Value Per Share $ 9.35 $ 10.03 $ 6.66 $ 2.83
- ------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
Janus Income Funds / October 31, 1999 31
<PAGE>
Statements of | Changes in Net Assets - Bond Funds
<TABLE>
<CAPTION>
Janus Janus
Flexible Income High-Yield
For the fiscal year ended October 31 Fund Fund
(all numbers in thousands) 1999 1998 1999 1998
- --------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C>
Net investment income $ 82,789 $ 59,625 $ 25,150 $ 29,888
Net realized gain/(loss) from investment transactions (25,147) 13,197 (16,857) (1,034)
Change in unrealized net appreciation or depreciation
of investments and foreign currency (40,980) (8,610) 11,471 (28,168)
- --------------------------------------------------------------------------------------------------------------------------
Net Increase/Decrease in Net Assets Resulting
from Operations 16,662 64,212 19,764 686
- --------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders:
Net investment income* (82,789) (59,616) (25,150) (29,888)
Net realized gain from investment transactions* -- (15,666) -- (16,609)
Distributions (in excess of realized gains)* (12,257) -- (128) --
- --------------------------------------------------------------------------------------------------------------------------
Net Decrease from Dividends and Distributions (95,046) (75,282) (25,278) (46,497)
- --------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold 825,274 693,045 365,566 498,190
Reinvested dividends and distributions 82,496 65,588 20,506 40,580
Shares repurchased (653,579) (371,073) (384,299) (526,164)
- --------------------------------------------------------------------------------------------------------------------------
Net Increase from Capital Share Transactions 254,191 387,560 1,773 12,606
- --------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 175,807 376,490 (3,741) (33,205)
Net Assets:
Beginning of period 1,103,591 727,101 268,217 301,422
- --------------------------------------------------------------------------------------------------------------------------
End of period $ 1,279,398 $ 1,103,591 $ 264,476 $ 268,217
- --------------------------------------------------------------------------------------------------------------------------
Net Assets Consist of:
Capital (par value and paid-in surplus)* $ 1,329,438 $ 1,075,251 $ 293,059 $ 291,286
Undistributed net investment income/(loss)* 845 708 (2) (6)
Undistributed net realized gain/(loss)
from investments* (24,960) 12,577 (18,090) (1,101)
Unrealized appreciation/(depreciation)
of investments and foreign currency (25,925) 15,055 (10,491) (21,962)
- --------------------------------------------------------------------------------------------------------------------------
$ 1,279,398 $ 1,103,591 $ 264,476 $ 268,217
- --------------------------------------------------------------------------------------------------------------------------
Transactions in Fund Shares:
Shares sold 84,300 69,152 34,587 43,131
Reinvested distributions 8,502 6,575 1,952 3,557
- --------------------------------------------------------------------------------------------------------------------------
Total 92,802 75,727 36,539 46,688
- --------------------------------------------------------------------------------------------------------------------------
Shares repurchased (67,277) (37,113) (36,321) (46,003)
Net Increase in Fund Shares 25,525 38,614 218 685
Shares Outstanding, Beginning of Period 111,320 72,706 26,156 25,471
- --------------------------------------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 136,845 111,320 26,374 26,156
- --------------------------------------------------------------------------------------------------------------------------
Purchases and Sales of Investment Securities
(excluding short-term securities):
Purchases of securities $ 1,346,096 $ 1,189,828 $ 805,894 $ 1,125,306
Proceeds from sales of securities 1,024,247 1,005,118 823,825 1,151,400
Purchases of long-term U.S. government obligations 223,265 367,064 35,637 41,042
Proceeds from sales of long-term U.S.
government obligations 354,717 210,399 41,215 36,070
<CAPTION>
Janus Janus
Federal Tax-Exempt Short-Term Bond
For the fiscal year ended October 31 Fund Fund
(all numbers in thousands) 1999 1998 1999 1998
- --------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C>
Net investment income $ 4,901 $ 3,530 $ 7,599 $ 5,297
Net realized gain/(loss) from investment transactions (1,455) 945 (1,384) 401
Change in unrealized net appreciation or depreciation
of investments and foreign currency (7,923) 701 (2,037) (14)
- --------------------------------------------------------------------------------------------------------------------------
Net Increase/Decrease in Net Assets Resulting
from Operations (4,477) 5,176 4,178 5,684
- --------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders:
Net investment income* (4,901) (3,530) (7,599) (5,297)
Net realized gain from investment transactions* -- -- -- --
Distributions (in excess of realized gains)* -- -- -- --
- --------------------------------------------------------------------------------------------------------------------------
Net Decrease from Dividends and Distributions (4,901) (3,530) (7,599) (5,297)
- --------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold 89,632 72,196 248,335 174,846
Reinvested dividends and distributions 4,034 2,930 6,859 4,807
Shares repurchased (79,714) (47,202) (253,671) (97,042)
- --------------------------------------------------------------------------------------------------------------------------
Net Increase from Capital Share Transactions 13,952 27,924 1,523 82,611
- --------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 4,574 29,570 (1,898) 82,998
Net Assets:
Beginning of period 91,625 62,055 140,906 57,908
- --------------------------------------------------------------------------------------------------------------------------
End of period $ 96,199 $ 91,625 $ 139,008 $ 140,906
- --------------------------------------------------------------------------------------------------------------------------
Net Assets Consist of:
Capital (par value and paid-in surplus)* $ 103,917 $ 89,965 $ 144,462 $ 142,939
Undistributed net investment income/(loss)* -- -- -- 1
Undistributed net realized gain/(loss)
from investments* (1,961) (506) (3,811) (2,428)
Unrealized appreciation/(depreciation)
of investments and foreign currency (5,757) 2,166 (1,643) 394
- --------------------------------------------------------------------------------------------------------------------------
$ 96,199 $ 91,625 $ 139,008 $ 140,906
- --------------------------------------------------------------------------------------------------------------------------
Transactions in Fund Shares:
Shares sold 12,550 9,960 86,489 60,319
Reinvested distributions 570 405 2,392 1,658
- --------------------------------------------------------------------------------------------------------------------------
Total 13,120 10,365 88,881 61,977
- --------------------------------------------------------------------------------------------------------------------------
Shares repurchased (11,262) (6,525) (88,343) (33,460)
Net Increase in Fund Shares 1,858 3,840 538 28,517
Shares Outstanding, Beginning of Period 12,595 8,755 48,497 19,980
- --------------------------------------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 14,453 12,595 49,035 48,497
- --------------------------------------------------------------------------------------------------------------------------
Purchases and Sales of Investment Securities
(excluding short-term securities):
Purchases of securities $ 50,205 $ 161,215 $ 74,926 $ 99,607
Proceeds from sales of securities 38,168 131,902 40,836 40,081
Purchases of long-term U.S. government obligations 21,460 25,207 57,745 64,672
Proceeds from sales of long-term U.S.
government obligations 21,100 28,292 92,054 43,995
</TABLE>
*See Note 3 in Notes to Financial Statements.
See Notes to Financial Statements.
32 Janus Income Funds / October 31, 1999
<PAGE>
Financial | Highlights - Bond Funds
<TABLE>
<CAPTION>
For a share outstanding throughout Janus Flexible Income Fund
each fiscal year ended October 31 1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 9.91 $ 10.00 $ 9.65 $ 9.55 $ 8.96
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .63 .67 .69 .73 .72
Net gains or (losses) on securities
(both realized and unrealized) (.45) .12 .37 .10 .59
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .18 .79 1.06 .83 1.31
- ------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.63) (.67) (.69) (.73) (.72)
Distributions (from capital gains) -- (.21) (.02) -- --
Distributions (in excess of capital gains) (.11) -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.74) (.88) (.71) (.73) (.72)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.35 $ 9.91 $ 10.00 $ 9.65 $ 9.55
- ------------------------------------------------------------------------------------------------------------------------------
Total Return 1.75% 8.14% 11.48% 9.01% 15.35%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets, End of Period (in thousands) $ 1,279,398 $ 1,103,591 $ 727,101 $ 603,655 $ 580,359
Average Net Assets for the Period (in thousands) $ 1,266,098 $ 892,853 $ 656,422 $ 603,694 $ 450,001
Ratio of Gross Expenses to Average Net Assets(1) 0.82% 0.84% 0.87% 0.88% 0.96%
Ratio of Net Expenses to Average Net Assets(1) 0.81% 0.82% 0.86% 0.87% 0.96%
Ratio of Net Investment Income
to Average Net Assets 6.54% 6.68% 7.10% 7.60% 7.91%
Portfolio Turnover Rate 119% 148% 207% 214% 250%
<CAPTION>
For a share outstanding throughout Janus High-Yield Fund
each fiscal year or period ended October 31 1999 1998 1997 1996(2)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 10.25 $ 11.83 $ 11.12 $ 10.00
- ---------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .89 .90 .97 .80
Net gains or (losses) on securities
(both realized and unrealized) (.22) (1.02) .82 1.12
- ---------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .67 (.12) 1.79 1.92
- ---------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.89) (.90) (.97) (.80)
Distributions (from capital gains) -- (.56) (.11) --
- ---------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.89) (1.46) (1.08) (.80)
- ---------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 10.03 $ 10.25 $ 11.83 $ 11.12
- ---------------------------------------------------------------------------------------------------------------------------------
Total Return* 6.34% (1.45%) 16.94% 19.71%
- ---------------------------------------------------------------------------------------------------------------------------------
Net Assets, End of Period (in thousands) $ 264,476 $ 268,217 $ 301,422 $ 210,933
Average Net Assets for the Period (in thousands) $ 296,586 $ 380,942 $ 266,213 $ 88,126
Ratio of Gross Expenses to Average Net Assets**(1) 1.02%(3) 0.99%(3) 1.03%(3) 1.01%(3)
Ratio of Net Expenses to Average Net Assets**(1) 1.00% 0.96% 1.00% 1.00%
Ratio of Net Investment Income to
Average Net Assets** 8.48% 7.85% 8.45% 9.00%
Portfolio Turnover Rate** 310% 336% 404% 324%
</TABLE>
(1) See "Explanation of the Charts and Tables."
(2) Fiscal period December 29, 1995 (inception) to October 31, 1996.
(3) The ratio was 1.05% in 1999, N/A in 1998, 1.04% in 1997 and 1.18% in 1996
before waiver of certain fees incurred by the Fund.
* Total return not annualized for periods of less than one year.
** Annualized for periods less than one year.
See Notes to Financial Statements.
Janus Income Funds / October 31, 1999 33
<PAGE>
Financial | Highlights - Bond Funds (continued)
<TABLE>
<CAPTION>
For a share outstanding throughout Janus Federal Tax-Exempt Fund
each fiscal year ended October 31 1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 7.27 $ 7.09 $ 6.92 $ 6.88 $ 6.45
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .34 .34 .35 .36 .36
Net gains or (losses) on securities
(both realized and unrealized) (.61) .18 .17 .04 .43
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations (.27) .52 .52 .40 .79
- ------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.34) (.34) (.35) (.36) (.36)
Distributions (from capital gains) -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.34) (.34) (.35) (.36) (.36)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 6.66 $ 7.27 $ 7.09 $ 6.92 $ 6.88
- ------------------------------------------------------------------------------------------------------------------------------
Total Return (4.04%) 7.65% 7.72% 5.94% 12.60%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets, End of Period (in thousands) $ 96,199 $ 91,625 $ 62,055 $ 44,858 $ 32,593
Average Net Assets for the Period (in thousands) $ 102,366 $ 74,133 $ 53,574 $ 36,312 $ 29,318
Ratio of Gross Expenses to Average Net Assets(1) 0.66%(2) 0.67%(2) 0.66%(2) 0.68%(2) 0.70%(2)
Ratio of Net Expenses to Average Net Assets(1) 0.65% 0.65% 0.65% 0.65% 0.65%
Ratio of Net Investment Income to
Average Net Assets 4.79% 4.76% 5.00% 5.18% 5.43%
Portfolio Turnover Rate 62% 227% 304% 225% 164%
<CAPTION>
For a share outstanding throughout Janus Short-Term Bond Fund
each fiscal year ended October 31 1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 2.91 $ 2.90 $ 2.86 $ 2.84 $ 2.87
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .16 .17 .17 .16 .18
Net gains or (losses) on securities
(both realized and unrealized) (.08) .01 .04 .02 (.03)
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .08 .18 .21 .18 .15
- ------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.16) (.17) (.17) (.16) (.18)
Distributions (from capital gains) -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.16) (.17) (.17) (.16) (.18)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 2.83 $ 2.91 $ 2.90 $ 2.86 $ 2.84
- ------------------------------------------------------------------------------------------------------------------------------
Total Return 2.82% 6.49% 7.70% 6.49% 5.55%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets, End of Period (in thousands) $ 139,008 $ 140,906 $ 57,908 $ 40,784 $ 48,117
Average Net Assets for the Period (in thousands) $ 135,882 $ 89,556 $ 48,421 $ 42,203 $ 47,383
Ratio of Gross Expenses to Average Net Assets(1) 0.66%(3) 0.67%(3) 0.67%(3) 0.67%(3) 0.66%(3)
Ratio of Net Expenses to Average Net Assets(1) 0.65% 0.65% 0.65% 0.65% 0.65%
Ratio of Net Investment Income
to Average Net Assets 5.59% 5.91% 6.03% 5.57% 6.67%
Portfolio Turnover Rate 101% 101% 133% 486% 337%
</TABLE>
(1) See "Explanation of Charts and Tables."
(2) The ratio was 1.01% in 1999, 0.99% in 1998, 1.11% in 1997, 1.14% in 1996
and 1.31% in 1995 before waiver of certain fees incurred by the Fund.
(3) The ratio was 1.03% in 1999, 1.06% in 1998, 1.20% in 1997, 1.23% in 1996
and 1.23% in 1995 before waiver of certain fees incurred by the Fund.
See Notes to Financial Statements.
34 Janus Income Funds / October 31, 1999
<PAGE>
Statements of | Operations - Money Market Funds
<TABLE>
<CAPTION>
Janus Janus
Janus Government Tax-Exempt
For the fiscal year ended October 31, 1999 Money Market Money Market Money Market
(all numbers in thousands) Fund Fund Fund
- -------------------------------------------------------------------------------------------------
Investment Income:
<S> <C> <C> <C>
Interest $ 378,637 $ 53,288 $ 7,463
- -------------------------------------------------------------------------------------------------
378,637 53,288 7,463
- -------------------------------------------------------------------------------------------------
Expenses:
Advisory fee for investor shares 1,809 231 123
Advisory fee for institutional shares 5,445 770 92
Advisory fee for service shares 31 46 4
Administrative fee for investor shares 9,043 1,154 615
Administrative fee for institutional shares 2,723 385 46
Administrative fee for service shares 16 23 2
Service fee for service shares 78 114 10
Audit fees 15 9 8
Trustees' fees and expenses 73 8 1
- -------------------------------------------------------------------------------------------------
Total Expenses 19,233 2,740 901
- -------------------------------------------------------------------------------------------------
Net Investment Income 359,404 50,548 6,562
- -------------------------------------------------------------------------------------------------
Net Realized Gain/(Loss) on Investments:
Net realized gain/(loss) from investment transactions 164 28 2
- -------------------------------------------------------------------------------------------------
Net Increase in Net Assets Resulting from Operations $ 359,568 $ 50,576 $ 6,564
- -------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
Janus Income Funds / October 31, 1999 35
<PAGE>
Statements of | Assets & Liabilities - Money Market Funds
Janus Janus
As of October 31, 1999 Janus Government Tax-Exempt
(all numbers in thousands except Money Market Money Market Money Market
net asset value per share) Fund Fund Fund
- --------------------------------------------------------------------------------
Assets:
Investments at amortized cost $ 6,871,408 $ 1,172,206 $ 285,210
Cash 31 106 4
Receivables:
Fund shares sold 49,801 2,971 936
Interest 58,993 2,758 1,463
- --------------------------------------------------------------------------------
Total Assets 6,980,233 1,178,041 287,613
- --------------------------------------------------------------------------------
Liabilities:
Payables
Investments purchased 99,545 -- 210
Fund shares repurchased 28,093 1,686 717
Dividends and distributions 13,904 2,623 30
Advisory fees 628 98 23
Administrative fees 1,200 183 67
Service fees 8 11 --
Audit fees 12 5 4
Trustees' fees and expenses 36 -- --
- --------------------------------------------------------------------------------
Total Liabilities 143,426 4,606 1,051
- --------------------------------------------------------------------------------
Net Assets $ 6,836,807 $ 1,173,435 $ 286,562
Shares Outstanding, $0.01 Par Value
(unlimited shares authorized) 6,836,807 1,173,435 286,562
- --------------------------------------------------------------------------------
Net Asset Value Per Share $ 1.00 $ 1.00 $ 1.00
- --------------------------------------------------------------------------------
See Notes to Financial Statements.
36 Janus Income Funds / October 31, 1999
<PAGE>
Statements of | Changes in Net Assets - Money Market Funds
<TABLE>
<CAPTION>
Janus Janus Government
Money Market Money Market
For the fiscal year ended October 31 Fund Fund
(all numbers in thousands) 1999 1998 1999 1998
- ---------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C>
Net investment income $ 359,404 $ 261,256 $ 50,548 $ 24,976
Net realized gain/(loss)
from investment transactions 164 161 28 10
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations 359,568 261,417 50,576 24,986
- ---------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders:
Net investment income:
Investor Shares (83,421) (57,683) (10,389) (7,537)
Institutional Shares (274,477) (202,020) (38,030) (17,406)
Service Shares (1,506) (1,553) (2,129) (33)
Net realized gain from investment transactions:
Investor Shares (35) (42) (5) (5)
Institutional Shares (128) (118) (21) (5)
Service Shares (1) (1) (2) --
- ---------------------------------------------------------------------------------------------------------------------------
Net Decrease from Dividends and Distributions (359,568) (261,417) (50,576) (24,986)
- ---------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold:
Investor Shares 8,897,000 5,447,777 567,007 384,359
Institutional Shares 132,210,692 89,394,668 5,587,450 2,152,976
Service Shares 303,125 323,786 86,689 2,772
Reinvested dividends and distributions:
Investor Shares 78,472 54,458 9,920 7,176
Institutional Shares 60,951 60,862 6,278 3,884
Service Shares 1,495 1,560 28 28
Shares repurchased:
Investor Shares (8,158,386) (5,042,859) (429,562) (310,430)
Institutional Shares (132,746,602) (87,252,582) (5,652,910) (1,371,965)
Service Shares (318,392) (293,167) (38,144) (658)
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) from
Capital Share Transactions 328,355 2,694,503 136,756 868,142
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 328,355 2,694,503 136,756 868,142
Net Assets:
Beginning of Period 6,508,452 3,813,949 1,036,679 168,537
- ---------------------------------------------------------------------------------------------------------------------------
End of Period $ 6,836,807 $ 6,508,452 $ 1,173,435 $ 1,036,679
- ---------------------------------------------------------------------------------------------------------------------------
Net Assets Consist of:
Capital (par value and paid-in surplus) $ 6,836,807 $ 6,508,452 $ 1,173,435 $ 1,036,679
Transactions in Fund Shares - Investor Shares:
Shares sold 8,897,000 5,447,777 567,007 384,359
Reinvested dividends and distributions 78,472 54,458 9,920 7,176
Total 8,975,472 5,502,235 576,927 391,535
Shares Repurchased (8,158,386) (5,042,859) (429,562) (310,430)
Net Increase/(Decrease) in Fund Shares 817,086 459,376 147,365 81,105
Shares Outstanding, Beginning of Period 1,492,023 1,032,647 213,239 132,134
- ---------------------------------------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 2,309,109 1,492,023 360,604 213,239
- ---------------------------------------------------------------------------------------------------------------------------
Transactions in Fund Shares - Institutional Shares:
Shares sold 132,210,692 89,394,668 5,587,450 2,152,976
Reinvested dividends and distributions 60,951 60,862 6,278 3,884
Total 132,271,643 89,455,530 5,593,728 2,156,860
Shares Repurchased (132,746,602) (87,252,582) (5,652,910) (1,371,965)
Net Increase/(Decrease) in Fund Shares (474,959) 2,202,948 (59,182) 784,895
Shares Outstanding, Beginning of Period 4,973,909 2,770,961 820,670 35,775
- ---------------------------------------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 4,498,950 4,973,909 761,488 820,670
- ---------------------------------------------------------------------------------------------------------------------------
Transactions in Fund Shares - Service Shares:
Shares sold 303,125 323,786 86,689 2,772
Reinvested dividends and distributions 1,495 1,560 28 28
Total 304,620 325,346 86,717 2,800
Shares Repurchased (318,392) (293,167) (38,144) (658)
Net Increase/(Decrease) in Fund Shares (13,772) 32,179 48,573 2,142
Shares Outstanding, Beginning of Period 42,520 10,341 2,770 628
- ---------------------------------------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 28,748 42,520 51,343 2,770
- ---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Janus Tax-Exempt
Money Market
For the fiscal year ended October 31 Fund
(all numbers in thousands) 1999 1998
- ---------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C>
Net investment income $ 6,562 $ 3,664
Net realized gain/(loss)
from investment transactions 2 26
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations 6,564 3,690
- ---------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions to Shareholders:
Net investment income:
Investor Shares (3,446) (2,879)
Institutional Shares (2,989) (678)
Service Shares (127) (107)
Net realized gain from investment transactions:
Investor Shares (2) (21)
Institutional Shares -- (3)
Service Shares -- (2)
- ---------------------------------------------------------------------------------------------------------------------------
Net Decrease from Dividends and Distributions (6,564) (3,690)
- ---------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold:
Investor Shares 309,165 330,543
Institutional Shares 547,727 211,444
Service Shares 1,260 38,120
Reinvested dividends and distributions:
Investor Shares 3,301 2,765
Institutional Shares 2,803 589
Service Shares 125 110
Shares repurchased:
Investor Shares (270,821) (309,566)
Institutional Shares (452,985) (174,273)
Service Shares (18,039) (20,544)
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) from
Capital Share Transactions 122,536 79,188
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 122,536 79,188
Net Assets:
Beginning of Period 164,026 84,838
- ---------------------------------------------------------------------------------------------------------------------------
End of Period $ 286,562 $ 164,026
- ---------------------------------------------------------------------------------------------------------------------------
Net Assets Consist of:
Capital (par value and paid-in surplus) $ 286,562 $ 164,026
Transactions in Fund Shares - Investor Shares:
Shares sold 309,165 330,543
Reinvested dividends and distributions 3,301 2,765
Total 312,466 333,308
Shares Repurchased (270,821) (309,566)
Net Increase/(Decrease) in Fund Shares 41,645 23,742
Shares Outstanding, Beginning of Period 105,011 81,269
- ---------------------------------------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 146,656 105,011
- ---------------------------------------------------------------------------------------------------------------------------
Transactions in Fund Shares - Institutional Shares:
Shares sold 547,727 211,444
Reinvested dividends and distributions 2,803 589
Total 550,530 212,033
Shares Repurchased (452,985) (174,273)
Net Increase/(Decrease) in Fund Shares 97,545 37,760
Shares Outstanding, Beginning of Period 41,319 3,559
- ---------------------------------------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 138,864 41,319
- ---------------------------------------------------------------------------------------------------------------------------
Transactions in Fund Shares - Service Shares:
Shares sold 1,260 38,120
Reinvested dividends and distributions 125 110
Total 1,385 38,230
Shares Repurchased (18,039) (20,544)
Net Increase/(Decrease) in Fund Shares (16,654) 17,686
Shares Outstanding, Beginning of Period 17,696 10
- ---------------------------------------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 1,042 17,696
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
Janus Income Funds / October 31, 1999 37
<PAGE>
Financial | Highlights - Money Market Funds
<TABLE>
<CAPTION>
Janus
For a share outstanding throughout Money Market
each fiscal year or period ended October 31 Fund
Investor Shares 1999 1998 1997 1996 1995(1)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .05 .05 .05 .05 .04
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .05 .05 .05 .05 .04
- ------------------------------------------------------------------------------------------------------------------------------
Less Dividends and Distributions:
Dividends (from net investment income) (.05) (.05) (.05) (.05) (.04)
- ------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions (.05) (.05) (.05) (.05) (.04)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value at End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Total Return* 4.69% 5.25% 5.23% 5.13% 3.95%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets at End of Period (in thousands) $ 2,309,109 $ 1,492,023 $ 1,032,647 $ 773,887 $ 643,219
Average Net Assets for the Period (in thousands) $ 1,808,653 $ 1,123,991 $ 883,052 $ 676,334 $ 461,311
Ratio of Expenses to Average Net Assets**(2) 0.60%(3) 0.60%(3) 0.60%(3) 0.60%(3) 0.60%(3)
Ratio of Net Investment Income to
Average Net Assets**(2) 4.61% 5.13% 5.09% 5.01% 5.56%
<CAPTION>
Janus Government
For a share outstanding throughout Money Market
each fiscal year or period ended October 31 Fund
Investor Shares 1999 1998 1997 1996 1995(1)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .04 .05 .05 .05 .04
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .04 .05 .05 .05 .04
- ------------------------------------------------------------------------------------------------------------------------------
Less Dividends and Distributions:
Dividends (from net investment income) (.04) (.05) (.05) (.05) (.04)
- ------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions (.04) (.05) (.05) (.05) (.04)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value at End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Total Return* 4.56% 5.12% 5.11% 5.03% 3.90%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets at End of Period (in thousands) $ 360,604 $ 213,239 $ 132,133 $ 117,408 $ 199,307
Average Net Assets for the Period (in thousands) $ 230,784 $ 150,525 $ 112,693 $ 112,059 $ 87,906
Ratio of Expenses to Average Net Assets**(2) 0.60%(3) 0.60%(3) 0.60%(3) 0.60%(3) 0.60%(3)
Ratio of Net Investment Income to
Average Net Assets**(2) 4.50% 5.01% 5.42% 4.91% 5.40%
</TABLE>
* Total return is not annualized for periods of less than one year.
** Annualized for periods less than one year.
(1) Fiscal period February 15, 1995, (inception) to October 31, 1995.
(2) See "Explanation of Charts and Tables."
(3) The ratio was .70% before waiver of certain fees incurred by the fund.
See Notes to Financial Statements.
38 Janus Income Funds / October 31, 1999
<PAGE>
<TABLE>
<CAPTION>
Janus Tax-Exempt
For a share outstanding throughout Money Market
each fiscal year or period ended October 31 Fund
Investor Shares 1999 1998 1997 1996 1995(1)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .03 .03 .03 .03 .02
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .03 .03 .03 .03 .02
- ------------------------------------------------------------------------------------------------------------------------------
Less Dividends and Distributions:
Dividends (from net investment income) (.03) (.03) (.03) (.03) (.02)
- ------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions (.03) (.03) (.03) (.03) (.02)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value at End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Total Return* 2.83% 3.23% 3.20% 3.27% 2.40%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets at End of Period (in thousands) $ 146,656 $ 105,011 $ 81,268 $ 74,638 $ 67,479
Average Net Assets for the Period (in thousands) $ 122,946 $ 91,058 $ 75,929 $ 68,695 $ 57,366
Ratio of Expenses to Average Net Assets**(2) 0.60%(3) 0.60%(3) 0.60%(3) 0.60%(3) 0.60%(3)
Ratio of Net Investment Income to
Average Net Assets**(2) 2.80% 3.16% 3.14% 3.22% 3.38%
<CAPTION>
Janus
For a share outstanding throughout Money Market
each fiscal year or period ended October 31 Fund
Institutional Shares 1999 1998 1997 1996 1995(4)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .05 .06 .06 .05 .03
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .05 .06 .06 .05 .03
- ------------------------------------------------------------------------------------------------------------------------------
Less Dividends and Distributions:
Dividends (from net investment income) (.05) (.06) (.06) (.05) (.03)
- ------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions (.05) (.06) (.06) (.05) (.03)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value at End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Total Return* 5.16% 5.72% 5.71% 5.61% 3.25%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets at End of Period (in thousands) $ 4,498,950 $ 4,973,909 $ 2,770,961 $ 1,705,610 $ 304,952
Average Net Assets for the Period (in thousands) $ 5,445,434 $ 3,620,872 $ 2,545,294 $ 874,431 $ 202,427
Ratio of Expenses to Average Net Assets**(2) 0.15%(5) 0.15%(5) 0.15%(5) 0.15%(5) 0.15%(5)
Ratio of Net Investment Income to
Average Net Assets**(2) 5.04% 5.58% 5.54% 5.41% 5.86%
</TABLE>
* Total return is not annualized for periods of less than one year.
** Annualized for periods less than one year.
(1) Fiscal period February 15, 1995, (inception) to October 31, 1995.
(2) See "Explanation of Charts and Tables."
(3) The ratio was .70% before waiver of certain fees incurred by the fund.
(4) Fiscal period April 17, 1995 (inception) to October 31, 1995.
(5) The ratio was .35% before waiver of certain fees incurred by the fund.
See Notes to Financial Statements.
Janus Income Funds / October 31, 1999 39
<PAGE>
Financial | Highlights - Money Market Funds (continued)
<TABLE>
<CAPTION>
Janus Government
For a share outstanding throughout Money Market
each fiscal year or period ended October 31 Fund
Institutional Shares 1999 1998 1997 1996 1995(1)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .05 .05 .05 .05 .03
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .05 .05 .05 .05 .03
- ------------------------------------------------------------------------------------------------------------------------------
Less Dividends and Distributions:
Dividends (from net investment income) (.05) (.05) (.05) (.05) (.03)
- ------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions (.05) (.05) (.05) (.05) (.03)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value at End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Total Return* 5.03% 5.59% 5.58% 5.50% 3.20%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets at End of Period (in thousands) $ 761,488 $ 820,670 $ 35,776 $ 59,490 $ 44,164
Average Net Assets for the Period (in thousands) $ 770,224 $ 321,174 $ 56,801 $ 53,398 $ 24,748
Ratio of Expenses to Average Net Assets**(2) 0.15%(3) 0.15%(3) 0.15%(3) 0.15%(3) 0.15%(3)
Ratio of Net Investment Income to
Average Net Assets**(2) 4.94% 5.42% 6.04% 5.34% 5.75%
<CAPTION>
Janus Tax-Exempt
For a share outstanding throughout Money Market
each fiscal year or period ended October 31 Fund
Institutional Shares 1999 1998 1997 1996 1995(1)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .03 .04 .04 .04 .02
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .03 .04 .04 .04 .02
- ------------------------------------------------------------------------------------------------------------------------------
Less Dividends and Distributions:
Dividends (from net investment income) (.03) (.04) (.04) (.04) (.02)
- ------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions (.03) (.04) (.04) (.04) (.02)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value at End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Total Return* 3.29% 3.67% 3.67% 3.74% 2.09%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets at End of Period (in thousands) $ 138,864 $ 41,319 $ 3,560 $ 1,947 $ 11,192
Average Net Assets for the Period (in thousands) $ 91,837 $ 18,859 $ 3,466 $ 1,754 $ 1,115
Ratio of Expenses to Average Net Assets**(2) 0.15%(3) 0.15%(3) 0.15%(3) 0.15%(3) 0.15%(3)
Ratio of Net Investment Income to
Average Net Assets**(2) 3.25% 3.60% 3.94% 3.82% 3.82%
</TABLE>
* Total return is not annualized for periods of less than one year.
** Annualized for periods less than one year.
(1) Fiscal period April 17, 1995, (inception) to October 31, 1995.
(2) See "Explanation of Charts and Tables."
(3) The ratio was .35% before waiver of certain fees incurred by the fund.
See Notes to Financial Statements.
40 Janus Income Funds / October 31, 1999
<PAGE>
<TABLE>
<CAPTION>
Janus Janus Government
For a share outstanding throughout Money Market Money Market
each fiscal year or period ended October 31 Fund Fund
Service Shares 1999 1998 1997(1) 1999 1998 1997(1)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value at Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- --------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .05 .05 .05 .05 .05 .05
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .05 .05 .05 .05 .05 .05
Less Dividends and Distributions:
Dividends (from net investment income) (.05) (.05) (.05) (.05) (.05) (.05)
- --------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions (.05) (.05) (.05) (.05) (.05) (.05)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value at End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- --------------------------------------------------------------------------------------------------------------------------------
Total Return* 4.89% 5.45% 5.14% 4.77% 5.33% 5.01%
- --------------------------------------------------------------------------------------------------------------------------------
Net Assets at End of Period (in thousands) $ 28,748 $ 42,520 $ 10,341 $ 51,343 $ 2,770 $ 628
Average Net Assets for the Period (in thousands) $ 31,250 $ 29,322 $ 913 $ 45,587 $ 639 $ 1,141
Ratio of Expenses to Average Net Assets**(2) 0.40%(3) 0.40%(3) 0.40%(3) 0.40%(3) 0.40%(3) 0.40%(3)
Ratio of Net Investment Income to
Average Net Assets**(2) 4.82% 5.30% 5.02% 4.67% 5.15% 5.23%
<CAPTION>
Janus Tax-Exempt
For a share outstanding throughout Money Market
each fiscal year or period ended October 31 Fund
Service Shares 1999 1998 1997(1)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value at Beginning of Period $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income .03 .03 .03
- ------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .03 .03 .03
- ------------------------------------------------------------------------------------------------------------------------------
Less Dividends and Distributions:
Dividends (from net investment income) (.03) (.03) (.03)
- ------------------------------------------------------------------------------------------------------------------------------
Total Dividends and Distributions (.03) (.03) (.03)
- ------------------------------------------------------------------------------------------------------------------------------
Net Asset Value at End of Period $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------
Total Return* 3.06% 3.44% 3.22%
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets at End of Period (in thousands) $ 1,042 $ 17,696 $ 10
Average Net Assets for the Period (in thousands) $ 4,090 $ 3,215 $ 10
Ratio of Expenses to Average Net Assets**(2) 0.40%(3) 0.40%(3) 0.40%(3)
</TABLE>
* Total return is not annualized for periods of less than one year.
** Annualized for periods less than one year.
(1) Fiscal period November 22, 1996, (inception) to October 31, 1997.
(2) See "Explanation of Charts and Tables."
(3) The ratio was .60% before waiver of certain fees incurred by the fund.
See Notes to Financial Statements.
Janus Income Funds / October 31, 1999 41
<PAGE>
Notes to | Schedules of Investments
DEM German Deutschemark
EUR Euro
* Non-income-producing security.
** A portion of this security has been segregated by the custodian to cover
margin or segregation requirements on open futures contracts, forward
currency contracts and/or swap spread lock agreements.
+ Securities are registered pursuant to Rule 144A and may be deemed to be
restricted for resale.
Variable Rate Notes. The interest rate, which is based on specific, or an index
of, market interest rates, is subject to change. Rates in the security
description are as of October 31, 1999.
Money market funds may hold securities with stated maturities of greater than
397 days when those securities have features that allow a fund to "put" back the
security to the issuer or to a third party within 397 days of acquisition. The
maturity dates shown in the security descriptions are the stated maturity dates.
Repurchase Agreements held by a fund are fully collateralized, and such
collateral is in the possession of the fund's custodian. The collateral is
evaluated daily to ensure its market value exceeds the current market value of
the repurchase agreements, including accrued interest. In the event of default
on the obligation to repurchase, the fund has the right to liquidate the
collateral and apply the proceeds in satisfaction of the obligation. In the
event of default or bankruptcy by the other party to the agreement, realization
and/or retention of the collateral or proceeds may be subject to legal
proceedings.
See Notes to Financial Statements.
42 Janus Income Funds / October 31, 1999
<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. Four series of shares (the "Bond Funds") included in
this report invest primarily in income-producing securities, and three
series of shares (the "Money Market Funds") invest exclusively in
high-quality money market instruments. Each of the Money Market Funds
offers three classes of shares.
"Investor Shares" are available to the general public, and "Institutional
Shares" are available only to investors that meet certain minimum account
sizes. "Service Shares" are available through banks and other financial
institutions.
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 (or yield
equivalent thereof) obtained from one or more dealers making a market for
such securities or by a pricing service approved by the Funds' Trustees.
Short-term investments maturing within 60 days for the Bond Funds and all
money market securities in the Money Market Funds 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 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 TRANSACTIONS AND FUTURES CONTRACTS
The Bond Funds may 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 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 on 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 Fund's 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 are also calculated on payables and receivables that
are denominated in foreign currencies. The payables and receivables are
generally related to security transactions and income.
Futures contracts are marked to market daily, and the variation margin is
recorded as an unrealized gain or loss. When a contract is closed, a
realized gain or loss is recorded equal to the difference between the
opening and closing value of the contract. Generally, open forward and
futures contracts are marked to market for federal income tax purposes at
fiscal year-end.
Foreign-denominated assets and forward currency contracts may involve more
risks than domestic transactions, including currency risk, political and
economic risk, regulatory risk and market risk. Risks may arise from the
potential inability of a counterparty to meet the terms of a contract and
from unanticipated movements in the value of foreign currencies relative to
the U.S. dollar.
The Bond Funds may enter into "futures contracts" and "options" on
securities, financial indexes, foreign currencies, forward contracts and
interest rate swaps and swap-related products. The Bond 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.
Swap Spread Lock Agreements are marked to market daily based upon
quotations from market makers and the change, if any, is recorded as
unrealized gains or
Janus Income Funds / October 31, 1999 43
<PAGE>
Notes to | Financial Statements (continued)
losses in the Statements of Operations. An amount of cash or other liquid
assets having an aggregate net asset value at least equal to the unrealized
gains or losses will be maintained in a segregated account by the Funds'
custodian. Janus Capital will monitor the creditworthiness of all
counterparties on an ongoing basis. If there is a default by the other
party to such a transaction, a Fund will have contractual remedies pursuant
to the agreements related to the transaction.
ADDITIONAL INVESTMENT RISK
Janus High-Yield Fund and Janus Flexible Income Fund may be invested in
lower-rated debt securities that have a higher risk of default or loss of
value because of changes in the economy or in their respective industry.
DIVIDEND DISTRIBUTIONS AND EXPENSES
Dividends are declared daily and distributed monthly. Each Bond 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. Of the ordinary income
distributions declared for the year ended October 31, 1999, 97% and 100%,
respectively, were exempt from federal income taxes for Janus Federal
Tax-Exempt Fund and Janus Tax-Exempt Money Market Fund.
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.
2. INVESTMENT ADVISORY AGREEMENTS AND OTHER TRANSACTIONS WITH AFFILIATES
The advisory agreements with the Bond Funds describe the fee that the Funds
must pay. Each of the Bond Funds are subject to the following schedule:
Average
Daily Net Annual Rate Expense Limit
Fee Schedule Assets of Fund Percentage (%) Percentage (%)
- --------------------------------------------------------------------------------
Janus Flexible Income Fund First $300 Million .65 1.00*
Over $300 Million .55
- --------------------------------------------------------------------------------
Janus High-Yield Fund First $300 Million .75 1.00*
Over $300 Million .65
- --------------------------------------------------------------------------------
Janus Federal First $300 Million .60 .65*
Tax-Exempt Fund Over $300 Million .55
- --------------------------------------------------------------------------------
Janus Short-Term First $300 Million .65 .65*
Bond Fund Over $300 Million .55
- --------------------------------------------------------------------------------
* Janus Capital will waive certain fees and expenses to the extent that net
expenses exceed the stated limits.
Each of the Money Market Funds pays Janus Capital .20% of average daily net
assets as an investment advisory fee. Janus Capital has agreed to reduce
its advisory fee for each of the Janus Money Market Funds to .10%. In
addition, each class of shares of each Money Market Fund pays Janus Capital
an administrative fee. This fee is .50%, .15%, and .40% of average daily
net assets for the Investor Shares, Institutional Shares, and Service
Shares, respectively. Janus Capital has agreed to reduce the administrative
fee to .05% and .30% on the Institutional Shares and Service Shares,
respectively. All other expenses of the Money Market Funds except Trustees
fees and expenses, audit fees and interest expenses are paid by Janus
Capital.
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 from each Bond Fund for transfer
agent services plus reimbursement of certain out-of-pocket expenses.
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 through Janus Capital and Janus Service. Fees paid to
DST for the period ended October 31, 1999, are noted below.
DST FEES
Janus Flexible Income Fund $184,757
Janus High-Yield Fund 73,617
Janus Federal Tax-Exempt Fund 35,551
Janus Short-Term Bond Fund 51,369
44 Janus Income Funds / October 31, 1999
<PAGE>
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.
Net capital loss carryovers noted below as of October 31, 1999, are
available to offset future realized capital gains and thereby reduce future
taxable gains distributions. These carryovers expire between October 31,
2002, and October 31, 2007. The aggregate cost of investments and the
composition of unrealized appreciation and depreciation of investment
securities for federal income tax purposes as of October 31, 1999, are
listed below. The federal tax cost for the Money Market Funds is the same
as listed in the Statement of Assets and Liabilities.
<TABLE>
<CAPTION>
Net
Net Capital Loss Federal Tax Unrealized Unrealized Appreciation/
Carryovers Cost Appreciation (Depreciation) (Depreciation)
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Janus Flexible Income Fund $(23,993,507) $1,285,823,918 $9,782,948 $(35,827,980) $(26,045,032)
Janus High-Yield Fund (17,605,707) 269,506,884 4,134,037 (15,107,206) (10,973,169)
Janus Federal Tax-Exempt Fund (1,963,344) 99,941,703 301,712 (6,056,522) (5,754,810)
Janus Short-Term Bond Fund (3,806,470) 137,471,106 50,215 (1,698,270) (1,648,055)
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
Net investment income distributions and capital gains distributions are
determined in accordance with income tax regulations, which may differ from
generally accepted accounting principles. These differences are due to
differing treatments for items such as deferral of wash sales, foreign
currency transactions, net operating losses and capital loss carryforwards.
Permanent items identified in the period ended October 31, 1999, have been
reclassified among the components of net assets as follows:
Undistributed Undistributed
Net Investment Net Realized Paid-In
Income Gains and Losses Capital
- --------------------------------------------------------------------------------
Janus Flexible Income Fund $137,010 $(131,712) $(5,298)
Janus High-Yield Fund 5,150 (5,150) --
Janus Federal Tax-Exempt Fund -- -- --
Janus Short-Term Bond Fund 16 -- (16)
- --------------------------------------------------------------------------------
Janus Income Funds / October 31, 1999 45
<PAGE>
Explanation of | Charts and Tables
1. PERFORMANCE OVERVIEWS
Performance overview graphs on the previous pages compare the performance
of a $10,000 investment in each Fund (from inception) to one or more widely
used market indexes through October 31, 1999.
When comparing the performance of a Fund with an index, keep in mind that
market indexes do not include brokerage commissions that would be incurred
if you purchased the individual securities in the index. They also do not
include taxes payable on dividends and interest or operating expenses
incurred if you maintained a portfolio invested in the index.
Average annual total returns are also 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, then calculating the annual compounded percentage rate that
would have produced the same result had the rate of growth been constant
throughout the period.
2. SCHEDULES OF INVESTMENTS
Following the performance overview section is each Fund's Schedule of
Investments. This schedule reports the industry concentrations and types of
securities held in each 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 is quoted as of the last day of the
reporting period. The value of securities denominated in foreign currencies
is converted into U.S. dollars.
2A. FORWARD CURRENCY CONTRACTS
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.
3. STATEMENT OF OPERATIONS
This statement details the Funds' income, expenses, gains and losses on
securities and currency transactions, and appreciation or depreciation of
current portfolio holdings.
The first section in this statement, entitled "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, transfer
agent fees, shareholder servicing expenses, and printing and postage for
mailing statements, financial reports and prospectuses.
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. An unrealized gain (or loss)
refers to the change in net appreciation or depreciation of the Funds'
portfolios during the period. "Net Gain/(Loss) on Investments" is affected
both by changes in the market value of portfolio holdings and by gains (or
losses) realized during the reporting period.
46 Janus Income Funds / October 31, 1999
<PAGE>
4. STATEMENT OF ASSETS AND LIABILITIES
This statement is often referred to as the "balance sheet." It lists the
assets and liabilities of the Funds on the last day of the reporting
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. Additionally, there may be other assets and liabilities such as
forward currency contracts.
The last line of this statement reports the Funds' net asset value (NAV)
per share on the last day of the reporting period. The NAV is calculated by
dividing the Funds' net assets (assets minus liabilities) by the number of
shares outstanding.
5. STATEMENT OF CHANGES IN NET ASSETS
This 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 is important to investors because it shows exactly
what caused the Funds' net asset size to change during the period.
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 entitled "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.
Janus Income Funds / October 31, 1999 47
<PAGE>
Explanation of | Charts and Tables (continued)
6. FINANCIAL HIGHLIGHTS
This schedule provides a per-share breakdown of the components that affect
the Funds' net asset value (NAV) for 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 reporting 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 period.
Also included 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.
These arrangements include the use of brokerage commissions, uninvested
cash balances earning interest or balance credits. The Statement of
Operations reflects total expenses before any such 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.
The ratio of net investment income summarizes 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 is the portfolio turnover rate, which measures the 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 means that
an amount equal to the value of the portfolio is sold every six months.
48 Janus Income Funds / October 31, 1999
<PAGE>
Report of | Independent Accountants
To the Trustees and Shareholders of
Janus Investment Fund
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Janus Flexible Income Fund, Janus
High-Yield Fund, Janus Federal Tax-Exempt Fund, Janus Short-Term Bond Fund,
Janus Money Market Fund, Janus Government Money Market Fund, and Janus
Tax-Exempt Money Market Fund (seven of the portfolios constituting the Janus
Investment Fund, hereafter referred to as the "Funds") at October 31, 1999, and
the results of each of their operations for the year then ended, the changes in
each of their net assets for each of the two years in the period then ended and
the financial highlights for each of the periods indicated, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Funds' management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at October 31, 1999 by
correspondence with the custodians and brokers, provide a reasonable basis for
the opinion expressed above.
PricewaterhouseCoopers LLP
/s/ PricewaterhouseCoopers LLP
Denver, Colorado
December 2, 1999
Year 2000 | Discussion (unaudited)
Preparing for Year 2000 is a high priority for Janus Capital, which has
established a dedicated group to address this issue. Janus Capital has devoted
considerable internal resources and has engaged one of the foremost experts in
the field to help achieve Year 2000 readiness. Janus Capital does not anticipate
that Year 2000-related issues will have a material impact on its ability to
continue to provide the Funds with service at current levels; however, Janus
Capital cannot make any assurances that the steps it has taken to ensure Year
2000 readiness will be successful. In addition, there can be no assurance that
Year 2000 issues will not affect the companies in which the Funds invest or
worldwide markets and economies.
Janus Income Funds / October 31, 1999 49
<PAGE>
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100 Fillmore Street
Denver, Colorado 80206-4923
1-800-525-3713
Funds distributed by Janus Distributors, Inc. Member NASD.
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