[GRAPHIC]
[GRAPHIC] Smith Barney
Managed
Municipals
Fund Inc.
-----------------------------------------------
SEMI-ANNUAL REPORT
-----------------------------------------------
August 31, 1998
[LOGO] Smith Barney Mutual Funds
Investing for your future.
Every day.(SM)
<PAGE>
Smith Barney Managed
Municipals Fund Inc.
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The Smith Barney Managed Municipals Fund Inc. seeks tax-free monthly income by
investing in a diversified portfolio consisting principally of intermediate- and
long-term municipal securities issued by state or municipal governments and by
public authorities.
Smith Barney Managed Municipals Fund Inc.
Average Annual Total Returns
August 31, 1998
<TABLE>
<CAPTION>
Without Sales Charges(1)
---------------------------------------
Class A Class B Class L(2)
===============================================================================
<S> <C> <C> <C>
Six Months+ 2.73% 2.41% 2.38%
- -------------------------------------------------------------------------------
One-Year 9.60 9.06 8.94
- -------------------------------------------------------------------------------
Five-Year 7.36 6.80 N/A
- -------------------------------------------------------------------------------
Ten-Year 9.34 N/A N/A
- -------------------------------------------------------------------------------
Since Inception++ 10.96 8.67 10.80
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<CAPTION>
With Sales Charges(3)
---------------------------------------
Class A Class B Class L(2)
===============================================================================
<S> <C> <C> <C>
Six Months+ (1.35)% (2.09)% 0.39%
- -------------------------------------------------------------------------------
One-Year 5.19 4.56 6.86
- -------------------------------------------------------------------------------
Five-Year 6.49 6.65 N/A
- -------------------------------------------------------------------------------
Ten-Year 8.90 N/A N/A
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Since Inception++ 10.70 8.67 10.52
===============================================================================
</TABLE>
(1) Assumes reinvestment of all dividends and capital gain distributions, if
any, at net asset value and does not reflect the deduction of the
applicable sales charges with respect to Class A and L shares or the
applicable contingent deferred sales charges ("CDSC") with respect to Class
B and L shares.
(2) On June 12, 1998, the former Class C shares were renamed Class L shares.
(3) Assumes reinvestment of all dividends and capital gain distributions, if
any, at net asset value. In addition, Class A and L shares reflect the
deduction of the maximum initial sales charges of 4.00% and 1.00%,
respectively; Class B shares reflect the deduction of a 4.50% CDSC, which
applies if shares are redeemed within one year from purchase. This CDSC
declines by 0.50% the first year of purchase and thereafter by 1.00% per
year until no CDSC is incurred. Class L shares also reflect the deduction
of a 1.00% CDSC, which applies if shares are redeemed within the first year
of purchase.
All figures represent past performance and are not a guarantee of future
results. Investment returns and principal value will fluctuate, and
redemption value may be more or less than the original cost.
+ Total return is not annualized, as it may not be representative of the
total return for the year.
++ Inception dates for Class A, B and L shares are March 4, 1981, November 6,
1992 and November 9, 1994, respectively.
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FUND HIGHLIGHT
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New-issue supply of municipal bonds in 1998 has been quite heavy. We are on pace
to surpass the record volume underwritten in 1993. These two factors -- pressure
toward lower rates and heavy municipal bond issuance -- have led to a market
that we believe is very attractively priced versus taxable bonds, and has led to
a flatter yield curve than we've seen in many years.
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NASDAQ SYMBOL
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Class A SHMMX
Class B SMMBX
Class L SMMLX
<TABLE>
<CAPTION>
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WHAT'S INSIDE
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<S> <C>
Shareholder Letter ........................................................ 1
Historical Performance .................................................... 3
Smith Barney Managed Municipals Fund Inc.
at a Glance ............................................................... 5
Schedule of Investments ................................................... 6
Statement of Assets and Liabilities ....................................... 34
Statement of Operations ................................................... 35
Statements of Changes in Net Assets ....................................... 36
Notes to Financial Statements ............................................. 37
Financial Highlights ...................................................... 40
Additional Shareholder Information ........................................ 44
</TABLE>
<PAGE>
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Shareholder Letter
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[PHOTO] [PHOTO]
HEATH B. JOSEPH P.
MCLENDON DEANE
Chairman Vice President and
Investment Officer
Dear Shareholder:
We are pleased to provide the semi-annual report for the Smith Barney Managed
Municipals Fund Inc. ("Fund") for the period ending August 31, 1998. In this
report, we summarize the period's prevailing economic and market conditions and
outline our portfolio strategy. A detailed summary of the Fund's performance can
be found in the appropriate sections that follow. We hope you find this report
to be useful and informative.
A Classic Series Fund
The Smith Barney Managed Municipals Fund is part of the Classic Series of Smith
Barney Mutual Funds. The Classic Series funds are mutual funds whose investment
decisions are determined by experienced portfolio managers based on each fund's
investment objectives and guidelines. Funds in the Smith Barney Classic Series
invest across asset classes and sectors, utilizing a range of strategies in
order to achieve their objectives.
Performance Update
For the six months ended August 31, 1998, the Smith Barney Managed Municipals
Fund had a total return of 2.73%, 2.41% and 2.38% for its Class A, B and L
shares, respectively. In comparison, the Fund's Lipper Analytical Services, Inc.
peer group average posted a total return of 3.03% for the same period. (Lipper
is a major fund-tracking organization).
Over the six-month period covered by this report, the Fund distributed income
dividends totaling $0.40 for Class A shares; based on its net asset value
("NAV") of $16.22 as of August 31, 1998, and the current dividend of $0.065 for
Class A shares, this equates to an annualized distribution rate of 4.81%. For an
individual in the federal income tax bracket of 36%, the tax-free yield of 4.81%
is equivalent to a taxable yield of 7.51%.
We are pleased to report that your Fund received a four-star rating overall for
its Class A and B shares from Morningstar, Inc.* as of June 30, 1998.
Municipal Bond Market Update
The municipal bond market has been in a positive state of mind for quite a while
now. Recent events in Asia and Russia have accelerated the flow of capital
specifically into U.S. government bonds. These factors have created a very
positive interest rate backdrop for the tax-exempt market with increased capital
flows into the U.S., very modest inflation and a potential slowing of the U.S.
economy due to the economic slowdown of several of our trading partners. This is
the lowest long-term interest rate climate we have seen since the 1960's.
The rates for municipal bonds have also moved lower, but not to the same degree
as U.S. government bonds. The municipal bond market doesn't benefit from
- ----------
* Morningstar, Inc. proprietary ratings reflect historical risk-adjusted
performance through 6/30/98. The ratings are subject to change every month.
Past performance is not a guarantee of future results. Morningstar ratings
are calculated from the Fund's 3- and 5-year returns (with fee adjustments)
in excess of 90-day T-bill returns. For Class A and Class B shares, the
Fund received 4 stars for the overall, 3 stars for the 3-year period and 5
stars for the 5-year period. It was rated among 1,549 and 890 for municipal
bond funds for the 3- and 5-year periods, respectively. Ten percent of the
funds in a rating category receive five stars.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 1
<PAGE>
foreign money flows, because the benefits of tax-exemption are only valuable to
U.S. taxpayers.
New issue supply of municipal bonds in 1998 has been quite heavy. The municipal
bond market is on pace to surpass the record volume underwritten in 1993. These
two factors -- pressure toward lower rates and heavy municipal bond issuance --
have led to a market that we believe is very reasonably priced versus taxable
bonds, and has led to a flatter yield curve than we've seen in many years. The
difference in yields between intermediate municipal bonds maturity and very
long-term bonds is minimal. In our view, the yield differential between very
high-grade paper and much weaker credits has never been lower. These investors
are not in our opinion being adequately compensated to insure their risk
profile.
Investment Strategy
As previously noted, the Fund seeks to maximize current interest income exempt
from federal income taxes to the extent consistent with prudent investment
management and preservation of capital. The Fund seeks to achieve this objective
by investing in intermediate- and long-term municipal securities issued by state
and municipal governments and by public authorities.
Recently, we have avoided very long-term debt and lower-rated issues. We have
been concentrating our purchases in very high-grade bonds with maturities
between 12 and 20 years. Our coupon structure has also become somewhat higher.
Quite simply, at today's record low interest rates, we are taking a more
conservative approach to the market. Our experience indicates conditions are
near perfect for bonds at the moment and prudence suggests we take advantage of
these conditions.
As of August 31, 1998, approximately 94% of the Fund's holdings were rated
investment-grade (BBB/Baa and higher) by either Standard & Poor's Ratings Group
or Moody's Investors Service Inc., with about 73% of the Fund invested in
AAA/Aaa-rated bonds, the highest possible rating. (Standard & Poor's and Moody's
are two major credit-reporting and bond-rating agencies). The Smith Barney
Managed Municipals Fund's largest holdings are concentrated in utility bonds
(15.7%), hospital bonds (12.8%) and transportation bonds (12.5%).
Municipal Bond Market Outlook
Our outlook for the municipal bond market for the next six months carries a
caveat. If economic conditions around the world do not get much worse, then
interest rates have fallen to levels that seem appropriate. If things continue
to deteriorate beyond today's levels, then there could be more downward pressure
on interest rates in the U.S. We will be monitoring these events very closely
for our shareholders. Thank you for investing in the Smith Barney Managed
Municipals Fund.
Sincerely,
/s/ Heath B. Mclendon /s/ Joseph P. Deane
Heath B. Mclendon Joseph P. Deane
Chairman Vice President and
Investment Officer
September 8, 1998
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2 1998 Semi-Annual Report to Shareholders
<PAGE>
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Historical Performance -- Class A Shares
================================================================================
<TABLE>
<CAPTION>
Net Asset Value
-----------------------------
Beginning End Income Capital Gain Return Total
Period Ended of Period of Period Dividends Distributions of Capital Returns(1)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
8/31/98 $16.19 $16.22 $0.40 $0.00 $0.00 2.73%+
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/98 15.61 16.19 0.79 0.48 0.00 12.30
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/97 16.20 15.61 0.91 0.38 0.00 4.51
- ------------------------------------------------------------------------------------------------------------------------------------
2/29/96 15.47 16.20 0.90 0.08 0.00 11.34
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/95 16.13 15.47 0.95 0.29 0.00 4.11
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/94 16.71 16.13 0.88 0.90 0.00 7.41
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/93 15.62 16.71 1.00 0.52 0.03 17.92
- ------------------------------------------------------------------------------------------------------------------------------------
2/29/92 14.98 15.62 1.05 0.00 0.02 11.79
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/91 15.00 14.98 1.09 0.00 0.03 7.65
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2/28/90 14.83 15.00 1.10 0.00 0.00 8.78
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2/28/89 15.05 14.83 1.11 0.16 0.00 7.31
====================================================================================================================================
Total $10.18 $2.81 $0.08
====================================================================================================================================
<CAPTION>
================================================================================
Historical Performance -- Class B Shares
================================================================================
Net Asset Value
-------------------------
Beginning End Income Capital Gain Return Total
Period Ended of Period of Period Dividends Distributions of Capital Returns(1)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
8/31/98 $16.19 $16.21 $0.36 $0.00 $0.00 2.41%+
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/98 15.60 16.19 0.71 0.48 0.00 11.81
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/97 16.20 15.60 0.83 0.38 0.00 3.92
- ------------------------------------------------------------------------------------------------------------------------------------
2/29/96 15.47 16.20 0.82 0.08 0.00 10.78
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/95 16.13 15.47 0.86 0.29 0.00 3.54
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/94 16.71 16.13 0.80 0.90 0.00 6.86
- ------------------------------------------------------------------------------------------------------------------------------------
Inception*-- 2/28/93 15.81 16.71 0.31 0.52 0.01 11.26+
====================================================================================================================================
Total $4.69 $2.65 $0.01
====================================================================================================================================
<CAPTION>
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Historical Performance -- Class L Shares
================================================================================
Net Asset Value
-------------------------
Beginning End Income Capital Gain Return Total
Period Ended of Period of Period Dividends Distributions of Capital Returns(1)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
8/31/98 $16.18 $16.20 $0.36 $0.00 $0.00 2.38%+
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/98 15.60 16.18 0.70 0.48 0.00 11.69
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/97 16.20 15.60 0.83 0.38 0.00 3.88
- ------------------------------------------------------------------------------------------------------------------------------------
2/29/96 15.47 16.20 0.82 0.08 0.00 10.76
- ------------------------------------------------------------------------------------------------------------------------------------
Inception*-- 2/28/95 14.30 15.47 0.27 0.29 0.00 12.36+
====================================================================================================================================
Total $2.98 $1.23 $0.00
====================================================================================================================================
</TABLE>
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Smith Barney Managed Municipals Fund Inc. 3
<PAGE>
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Historical Performance -- Class Y Shares
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<TABLE>
<CAPTION>
Net Asset Value
-------------------------
Beginning End Income Capital Gain Return Total
Period Ended of Period of Period Dividends Distributions of Capital Returns(1)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
8/31/98 $16.19 $16.21 $0.42 $0.00 $0.00 2.76%+
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/98 15.60 16.19 0.82 0.48 0.00 12.56
- ------------------------------------------------------------------------------------------------------------------------------------
2/28/97 16.20 15.60 0.94 0.38 0.00 4.59
- ------------------------------------------------------------------------------------------------------------------------------------
Inception*-- 2/29/96 15.63 16.20 0.85 0.08 0.00 9.84+
====================================================================================================================================
Total $3.03 $0.94 $0.00
====================================================================================================================================
It is the Fund's policy to distribute dividends monthly and capital gains, if
any, annually.
<CAPTION>
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Average Annual Total Return
================================================================================
Without Sales Charge(1)
---------------------------------------------------------------------------------
Class A Class B Class L Class Y
====================================================================================================================================
<S> <C> <C> <C> <C>
Six Months Ended 8/31/98+ 2.73% 2.41% 2.38% 2.76%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended 8/31/98 9.60 9.06 8.94 9.79
- ------------------------------------------------------------------------------------------------------------------------------------
Five Years Ended 8/31/98 7.36 6.80 N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
Ten Years Ended 8/31/98 9.34 N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
Inception* through 8/31/98 10.96 8.67 10.80 8.70
====================================================================================================================================
<CAPTION>
Without Sales Charge(2)
---------------------------------------------------------------------------------
Class A Class B Class L Class Y
====================================================================================================================================
<S> <C> <C> <C> <C>
Six Months Ended 8/31/98+ (1.35)% (2.09)% 0.39% 2.76%
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended 8/31/98 5.19 4.56 6.86 9.79
- ------------------------------------------------------------------------------------------------------------------------------------
Five Years Ended 8/31/98 6.49 6.65 N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
Ten Years Ended 8/31/98 8.90 N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
Inception* through 8/31/98 10.70 8.67 10.52 8.70
====================================================================================================================================
================================================================================
Cumulative Total Return
================================================================================
<CAPTION>
Without Sales Charge(1)
====================================================================================================================================
<S> <C>
Class A (8/31/88 through 8/31/98) 144.19%
- ------------------------------------------------------------------------------------------------------------------------------------
Class B (Inception* through 8/31/98) 62.22
- ------------------------------------------------------------------------------------------------------------------------------------
Class L (Inception* through 8/31/98) 47.82
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Class Y (Inception* through 8/31/98) 32.90
====================================================================================================================================
</TABLE>
(1) Assumes reinvestment of all dividends and capital gain distributions, if
any, at net asset value and does not reflect the deduction of the
applicable sales charges with respect to Class A and L shares or the
applicable contingent deferred sales charges ("CDSC") with respect to Class
B and L shares.
(2) Assumes reinvestment of all dividends and capital gain distributions, if
any, at net asset value. In addition, Class A and L shares reflect the
deduction of the maximum initial sales charges of 4.00% and 1.00%,
respectively; Class B shares reflect the deduction of a 4.50% CDSC, which
applies if shares are redeemed within one year from purchase. This CDSC
declines by 0.50% the first year after purchase and thereafter by 1.00% per
year until no CDSC is incurred. Class L shares also reflect the deduction
of a 1.00% CDSC, which applies if shares are redeemed within the first year
of purchase.
* Inception dates for Class A, B, L and Y shares are March 4, 1981, November
6, 1992, November 9, 1994 and April 4, 1995, respectively.
+ Total return is not annualized, as it may not be representative of the
total return for the year.
- --------------------------------------------------------------------------------
4 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Smith Barney Managed Municipals Fund Inc. at a Glance (unaudited)
================================================================================
Growth of $10,000 Invested in Class A Shares of Smith Barney Managed Municipals
Fund Inc. vs. Lehman Brothers Municipal Bond Fund Index and the Lipper Peer
Group Average+
- --------------------------------------------------------------------------------
August 1988 -- August 1998
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE CHART IN THE PRINTED MATERIAL.]
<TABLE>
<CAPTION>
Smith Barney Lehman Brothers
Managed Municipals Municipal Bond Lipper Peer
Funds Inc. Fund Index Group Average
------------------ -------------- -------------
<S> <C> <C> <C>
Aug 1988 $ 9,603 $10,000 $10,000
Feb 1989 $10,122 $10,465 $10,537
Feb 1990 $11,011 $11,539 $11,468
Feb 1991 $11,853 $12,604 $12,396
Feb 1992 $13,251 $13,862 $13,655
Feb 1993 $15,626 $15,771 $15,589
Feb 1994 $16,780 $16,644 $16,413
Feb 1995 $17,468 $16,958 $16,519
Feb 1996 $19,449 $18,831 $18,147
Feb 1997 $20,325 $19,869 $18,959
Feb 1998 $22,825 $21,686 $20,677
Aug 1998 $23,449 $22,432 $21,304
</TABLE>
+ Hypothetical illustration of $10,000 invested in Class A shares on August
31, 1988, assuming deduction of the maximum 4.00% sales charge at the time
of investment and reinvestment of dividends and capital gains, if any, at
net asset value through August 31, 1998. The Lehman Brothers Municipal Bond
Fund Index is a weighted composite which is comprised of more than 15,000
bonds issued within the last 5 years, having a minimum credit rating of at
least Baa and a maturity of at least 2 years, excluding all bonds subject
to the Alternative Minimum Tax and bonds with floating or zero coupons. The
index is unmanaged and is not subject to the same management and trading
expenses as a mutual fund. The Lipper Analytical Services, Inc. Peer Group
Average ("Lipper Peer Group Average") is composed of an average of the
Fund's peer group of 251 mutual funds investing in municipal securities as
of August 31, 1998. The performance of the Fund's other classes may be
greater or less than the Class A shares' performance indicated on this
chart, depending on whether greater or lesser sales charges and fees were
incurred by shareholders investing in the other classes.
All figures represent past performance and are not a guarantee of future
results. Investment returns and principal value will fluctuate, and
redemption values may be more or less than the original cost. No adjustment
has been made for shareholder tax liability on dividends or capital gains.
Top Ten States Represented*
- --------------------------------------------------------------------------------
[THE FOLLOWING TABLE WAS REPRESENTED BY A BAR CHART IN THE PRINTED MATERIAL.]
<TABLE>
<CAPTION>
States Percentage
- ------ ----------
<S> <C>
California 8.8%
Colorado 8.3%
Florida 4.5%
Massachusetts 5.4%
Michigan 5.8%
New York 10.8%
Ohio 4.2%
Pennsylvania 3.5%
Texas 19.7%
Washington 2.3%
</TABLE>
* As a percentage of total investments.
Industry Breakdown*
- --------------------------------------------------------------------------------
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
<TABLE>
<CAPTION>
Industry Percentage
- -------- ----------
<S> <C>
Utilities 15.7%
Water & Sewer 11.7%
Other Municipal Bonds 18.8%
Cogeneration Facilities 3.5%
Education 11.3%
General Obligation 10.4%
Hospital 12.8%
Housing 2.5%
PCR 0.8%
Transportation 12.5%
</TABLE>
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 5
<PAGE>
================================================================================
Schedule of Investments (unaudited) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Alaska -- 0.3%
Valdez, AK Marine Terminal Revenue:
$ 8,500,000 AA Series A, British Petroleum Pipeline Project,
5.850% due 8/1/25(a) $ 8,861,250
300,000 A-1+ Exxon Pipeline Co. Project A, 3.200% due 12/1/33(b) 300,000
1,300,000 A-1+ Exxon Pipeline Co. Project B, 3.200% due 12/1/33(b) 1,300,000
- ------------------------------------------------------------------------------------------------------------------------------------
10,461,250
- ------------------------------------------------------------------------------------------------------------------------------------
Arizona -- 1.1%
Bullhead City, AZ Municipal Property Corporate Excise Tax Revenue,
Wastewater Treatment Plants Improvements, MBIA-Insured:
375,000 Aaa* 5.000% due 7/1/13 382,031
285,000 Aaa* 5.000% due 7/1/14 288,919
12,170,000 A Greenlee County, AZ IDA, PCR, (Phelps Dodge Corp. Project),
5.450% due 6/1/09 12,763,287
3,500,000 A Maricopa County, AZ IDA, Multi-Family Housing Revenue, Series A,
6.500% due 10/1/25 3,710,000
Maricopa County, AZ Pollution Control Corp., PCR,
(Arizona Public Service Co.):
3,900,000 A-1+ Series A, 3.200% due 5/1/29(b) 3,900,000
3,800,000 A-1+ Series B, 3.300% due 5/1/29(b) 3,800,000
Maricopa County, AZ School District Number 1,
(Phoenix Elementary Project of 1998), Series A, FSA-Insured:
2,600,000 AAA 5.000 due 7/1/13 2,655,250
1,500,000 AAA 5.000 due 7/1/14 1,526,250
4,200,000 A-1+ Navajo County, AZ IDA, IDR, (Citizens Utilities Projects), Series B,
3.350% due 9/1/32(b)(c) 4,200,000
1,750,000 AAA Pima County, AZ COP, MBIA-Insured, 5.250% due 1/1/12 1,830,938
3,500,000 AAA Pima County, AZ IDA, Healthpartners of Southern Arizona, Series A,
MBIA-Insured, 5.625% due 4/1/14 3,775,625
1,830,000 Aaa* Pinal County, AZ Community College, Pledge Obligation,
AMBAC-Insured, 5.000% due 7/1/12 1,857,450
1,000,000 AAA Sedona, AZ Wastewater Municipal, Property Corp.
Excise Tax Revenue, MBIA-Insured, 5.375% due 7/1/15 1,040,000
2,000,000 AAA Yavapi County, AZ IDA, Yavapi Regional Medical Center, Series A,
FSA-Insured, 5.125% due 12/1/13 2,072,500
- ------------------------------------------------------------------------------------------------------------------------------------
43,802,250
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas -- 0.0%
750,000 AA Pulaski County, AR Health Facility Board Revenue, Catholic Health
Initiatives, Series A, 5.000% due 12/1/18 749,063
- ------------------------------------------------------------------------------------------------------------------------------------
California -- 8.8%
Alameda County, CA COP, (Refunding and Capital Projects),
AMBAC-Insured:
1,000,000 AAA 5.000% due 6/1/13 1,020,000
750,000 AAA 5.000% due 6/1/14 762,187
720,000 AAA 5.000% due 6/1/16 722,700
2,250,000 A* Apple Valley, CA Unified School District, COP, 5.900% due 9/1/11 2,370,937
2,720,000 AAA Brawley, CA COP, (Water Systems Improvement Project),
5.000% due 12/1/18 2,716,600
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
6 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
California -- 8.8% (continued)
California Health Facilities Finance Authority Revenue:
Kaiser Permanente, Series A, FSA-Insured:
$ 3,500,000 AAA 5.000% due 6/1/18 $ 3,495,625
11,000,000 AAA 5.500% due 6/1/22 11,536,250
23,565,000 AAA Stanford Health Care, Series B, AMBAC-Insured,
5.000% due 11/15/18 23,388,262
9,250,000 AAA California State Department of Corrections, Board Lease Revenue,
Series A, AMBAC-Insured, 5.250% due 1/1/21 9,388,750
7,545,000 AAA California State Department of Transportation,
Series A, MBIA-Insured, 5.250% due 3/1/16 7,761,919
5,000,000 AAA California State Health Facilities Finance Authority Revenue,
Cedars-Sinai Center, Series A, MBIA-Insured, 5.125% due 8/1/17 5,050,000
5,895,000 A California State Public Works Board, Lease Revenue, Series C,
5.250% due 10/1/14 6,071,850
California Statewide Community Development Authority, COP:
2,000,000 A Kaiser Permanente Remarketed 7/8/98, 5.300% due 12/1/15 2,027,500
St. Joseph Health System:
10,500,000 AA 5.125% due 7/1/17 10,552,500
9,500,000 AA 5.250% due 7/1/21 9,618,750
3,000,000 AAA Campbell, CA Unified School District, GO, FGIC-Insured,
5.000% due 8/1/17 3,015,000
7,000,000 AAA Chino, CA Unified School District, COP, FSA-Insured,
6.125% due 9/1/26 7,647,500
5,000,000 AAA Contra Costa County, CA Multi-Family Housing Revenue, (Crescent Park
Apartments Project), Series B, GNMA-Collateralized,
7.800% due 6/20/34 5,650,000
15,215,000 AAA Corona, CA Redevelopment Agency, Series A, FGIC-Insured,
5.000% due 9/1/24 15,766,544
5,000,000 AAA Fresno County, CA Financing Authority, Solid Waste Revenue,
(American Avenue Landfill Project), MBIA-Insured,
5.750% due 5/15/14 5,381,250
Long Beach, CA (Aquarium of the Pacific Project):
1,260,000 BBB 5.750% due 7/1/05 1,356,075
1,200,000 BBB 5.750% due 7/1/06 1,282,500
1,170,000 AAA Los Angeles, CA Community Redevelopment Agency, (Hollywood
Redevelopment Project), Series C, MBIA-Insured,
5.000% due 7/1/14 1,194,862
Los Angeles, CA Metropolitan Transportation Authority,
Sales Tax Revenue, Series A, MBIA-Insured:
17,770,000 AAA 5.250% due 7/1/14 18,436,375
15,000,000 AAA 5.250% due 7/1/15 15,468,750
1,630,000 AAA Los Angeles, CA Public Works Finance Authority Lease Revenue,
MBIA-Insured, 5.250% due 9/1/13 1,699,275
2,780,000 AAA Los Angeles, CA Unified School District, COP, Series A, FSA-Insured,
5.500% due 10/1/16 2,922,475
Los Angeles, CA Wastewater Systems Revenue, FGIC-Insured:
10,080,000 AAA Series A, 5.000% due 6/1/18 10,067,400
20,140,000 AAA Series B, 5.000% due 6/1/18 20,114,825
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 7
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
California -- 8.8% (continued)
$ 15,400,000 AA Los Angeles County, CA Public Works Financing Authority Revenue,
(Regional Park and Open Space District), Series A,
5.000% due 10/1/16 $ 15,419,250
Metropolitan Water District, Southern California Waterworks
Revenue, Series A:
8,185,000 AA 5.000% due 7/1/15 8,287,313
2,500,000 AA 5.000% due 7/1/18 2,496,875
15,000,000 AAA Orange County, CA Recovery, COP, Series A, MBIA-Insured,
5.875% due 7/1/19 16,293,750
5,200,000 AAA Roseville, CA Water Utility Revenue, COP, FGIC-Insured,
5.200% due 12/1/15 5,356,000
2,500,000 AAA Sacramento, CA Cogeneration Authority, Cogeneration Project
Revenue, MBIA-Insured, 5.200% due 7/1/21 2,509,375
3,500,000 AAA Sacramento, CA Municipal Utility District, Electrical Revenue,
Series L, MBIA-Insured, 5.200% due 7/1/17 3,574,375
San Diego County, CA COP, Northern County Regional Expansion
Revenue, AMBAC-Insured:
5,500,000 AAA 5.250% due 11/15/14 5,713,125
4,000,000 AAA 5.000% due 10/1/17 4,015,000
2,420,000 AAA 5.250% due 11/15/19 2,468,400
3,500,000 AA- San Diego County, CA Water Authority, Water Revenue, COP,
Series A, 4.750% due 5/1/15 3,438,750
46,755,000 AAA San Francisco, CA State Building Authority, Lease Revenue,
(Civic Center Complex), Series A, AMBAC-Insured,
5.250% due 12/1/21 47,690,100
Santa Clara County, CA Finance Authority, Lease Revenue,
AMBAC-Insured:
5,500,000 AAA 6.750% due 11/15/20(a) 6,407,500
2,000,000 AAA 6.250% due 11/15/22 2,245,000
1,515,000 AAA Victorville, CA Multi-Family Revenue, Wimbledon Apartments,
Series A, GNMA-Collateralized, 6.150% due 4/20/16 1,622,943
- ------------------------------------------------------------------------------------------------------------------------------------
334,024,417
- ------------------------------------------------------------------------------------------------------------------------------------
Colorado -- 8.3%
Arapahoe County, CO Capital Improvement Transportation,
Highway Revenue:
15,000,000 Baa3* Pre-Refunded--Escrowed with U.S. government securities to
8/31/05 call @ 103, 7.000% due 8/31/26(a)(d) 17,962,500
27,350,000 AAA Series A, MBIA-Insured, 5.000% due 9/1/21 27,315,812
Colorado Health Facilities Authority Revenue:
18,250,000 A Series A, Remarketed 7/8/98, 5.350% due 11/1/16 18,500,937
11,000,000 A Series B, Remarketed 7/8/98, 5.350% due 8/1/15 11,206,250
8,765,000 AAA Sisters of Charity Leavenworth, MBIA-Insured,
5.125% due 12/1/18 8,863,606
12,765,000 BBB+ Colorado Springs, CO Airport Revenue, Series A,
7.000% due 1/1/22(a)(c) 14,073,412
Dawson Ridge, CO Metropolitan District No. 1, (Escrowed to
Maturity with U.S. government securities):
364,000,000 Aaa* Series A, zero coupon bond to yield 6.644% due 10/1/22 99,645,000
27,785,000 Aaa* Series B, zero coupon bond to yield 6.820% due 10/1/22(a) 7,606,144
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
8 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Colorado -- 8.3% (continued)
Denver, CO City & County Airport Revenue:
Series A:
$ 26,500,000 Baa1* 14.000% due 11/15/08(a)(c) $ 44,950,625
9,915,000 Baa1* 8.000% due 11/15/25(a)(c) 10,956,075
3,585,000 Aaa* Pre-Refunded--Escrowed with U.S. government securities to
11/15/01 Call @ 100, 8.000% due 11/15/25(a)(c) 4,019,681
Series C:
3,090,000 Baa1* 6.750% due 11/15/13(c) 3,375,825
9,505,000 Baa1* 6.750% due 11/15/22(a)(c) 10,312,925
410,000 Aaa* Pre-Refunded--Escrowed with U.S. government securities to
11/15/02 Call @ 102, 6.750% due 11/15/13(c) 459,712
2,530,000 Aaa* Pre-Refunded--Escrowed with U.S. government securities to
11/15/01 Call @ 100, 6.750% due 11/15/22(a)(c) 2,836,763
Series D:
17,760,000 Baa1* 7.000% due 11/15/25(c) 19,003,200
4,665,000 Aaa* Pre-Refunded--Escrowed with U.S. government securities to
11/15/01 Call @ 100, 7.000% due 11/15/25(a)(c) 5,084,850
E-470 Public Highway Authority, Colorado Revenue,
Series A, MBIA-Insured:
1,120,000 AAA 5.000% due 9/1/15 1,131,200
2,600,000 AAA 5.000% due 9/1/16 2,616,250
1,000,000 AAA Fort Collins, CO Lease, COP, (Civic Center Facilities Project),
MBIA-Insured, 5.125% due 12/1/18 1,011,250
3,610,000 AAA Larimer County, CO COP, Courthouse & Jail Facilities, FSA-Insured,
5.000% due 12/15/12 3,655,125
- ------------------------------------------------------------------------------------------------------------------------------------
314,587,142
- ------------------------------------------------------------------------------------------------------------------------------------
Connecticut -- 0.3%
1,080,000 AAA Connecticut State Health & Educational Facilities Authority Revenue,
William H. Backus Hospital, AMBAC-Insured, 5.625% due 7/1/17 1,152,900
Connecticut State Housing Finance Authority, AMBAC-Insured,
Group Home Mortgage Program:
500,000 AAA 5.600% due 6/15/17 521,875
1,000,000 AAA 5.625% due 6/15/27 1,047,500
Mashantucket Western Pequot Tribe, Connecticut Special Revenue,
Sub-144A, Series B:
1,000,000 Baa3* 5.550% due 9/1/08(e) 1,062,500
2,000,000 Baa3* 5.700% due 9/1/12(e) 2,125,000
6,500,000 Baa3* 5.750% due 9/1/18(a)(e) 6,800,625
- ------------------------------------------------------------------------------------------------------------------------------------
12,710,400
- ------------------------------------------------------------------------------------------------------------------------------------
District of Columbia -- 0.9%
District of Columbia Revenue,
The American University, Education Revenue, AMBAC-Insured:
3,000,000 AAA 5.250% due 1/1/16 3,086,250
14,000,000 AAA 5.125% due 1/1/27 14,070,000
Georgetown University, Series D, MBIA-Insured,
Converted 5/1/98:
4,300,000 AAA 5.300% due 4/1/15 4,445,125
3,900,000 AAA 5.350% due 4/1/16 4,031,625
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 9
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
District of Columbia -- 0.9% (continued)
$ 3,700,000 AAA 5.350% due 4/1/17 $ 3,824,875
5,300,000 AAA 5.350% due 4/1/18 5,459,000
- ------------------------------------------------------------------------------------------------------------------------------------
34,916,875
- ------------------------------------------------------------------------------------------------------------------------------------
Florida -- 4.5%
Boynton Beach, FL Multi-Family Housing Revenue,
Clipper Cove Apartments:
750,000 A+ 6.350% due 7/1/16 800,625
1,325,000 A+ 6.400% due 7/1/21 1,414,437
Broward County, FL GO, Public Improvement Revenue:
1,000,000 Aa2* 12.500% due 1/1/02 1,266,250
1,250,000 Aa2* 12.500% due 1/1/03 1,670,312
1,500,000 Aa2* 12.500% due 1/1/04 2,101,875
1,750,000 Aa2* 12.500% due 1/1/05 2,563,750
2,000,000 Aa2* 12.500% due 1/1/06 3,050,000
2,375,000 AAA Celebration, FL Community Development District, Series B,
MBIA-Insured, 5.500% due 5/1/19 2,478,906
2,740,000 AAA Dade County, FL GO, MBIA-Insured, 5.125% due 12/1/21 2,763,975
900,000 A-1+ Dade County, FL IDA, Exempt Facilities Revenue,
Florida Power & Light Co., 3.350% due 6/1/21(b) 900,000
41,270,000 AAA Dade County, FL Water and Sewer Revenue, FGIC-Insured,
5.250% due 10/1/21(a) 42,146,987
1,000,000 AAA First Florida Governmental Financing Commission Revenue,
AMBAC-Insured, 5.750% due 7/1/16 1,078,750
3,400,000 AAA Florida State Correctional Privatization Commission, COP, Youth
Detention Facility, Series C, AMBAC-Insured, 5.000% due 8/1/17 3,404,250
Florida State Turnpike Authority, Turnpike Revenue, Department of
Transportation, Series A, FGIC-Insured:
4,040,000 AAA 5.000% due 7/1/13 4,151,100
5,180,000 AAA 5.000% due 7/1/14 5,264,175
8,985,000 AAA 5.000% due 7/1/15 9,097,312
7,350,000 AA Gainesville, FL Utilities Systems Revenue, Series A,
5.200% due 10/1/22 7,451,063
6,715,000 AAA Halifax, FL Hospital Medical Center Revenue, Series A,
MBIA-Insured, 5.250% due 10/1/15 6,924,844
6,190,000 AAA Hillsborough County, FL Capital Improvement Program Revenue,
Series A, MBIA-Insured, 5.125% due 7/1/22 6,251,900
1,000,000 VMIG 1* Hillsborough County, FL IDA, PCR, (Tampa Electric Co.),
3.200% due 9/1/25(b) 1,000,000
2,000,000 AAA Juniper Island, FL Utilities Systems Revenue,
South Martin Regional Utility, MBIA-Insured, 5.000% due 10/1/18 2,007,500
Martin County, FL IDA, Indiantown Cogeneration:
10,000,000 BBB- Project A, 7.875% due 12/15/25(a)(c) 11,675,000
6,010,000 BBB- Project B, 8.050% due 12/15/25(c) 7,076,775
5,000,000 AAA Orange County, FL Tourist Development Tax Revenue, MBIA-Insured,
5.000% due 10/1/19 5,012,500
6,500,000 Aaa* Polk County, FL Utility Systems Revenue, Series A, FGIC-Insured,
5.250% due 10/1/17 6,719,375
Reedy Creek, FL Import District Utilities Revenue:
8,200,000 AAA Series C, AMBAC-Insured, 5.000% due 6/1/19 8,220,500
3,830,000 AAA Series 1, MBIA-Insured, 5.000% due 10/1/19 3,834,788
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
10 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Florida -- 4.5% (continued)
Seminole County, FL School Board, COP, AMBAC-Insured, Series A:
$ 4,000,000 AAA 5.000% due 7/1/17 $ 4,005,000
4,425,000 AAA 5.000% due 7/1/19 4,436,063
Tampa, FL Revenue Bonds, (Florida Aquarium Inc. Project),
(Pre-Refunded--Escrowed with U.S. government securities
to 5/1/02 Call @ 102):
2,700,000 NR 7.550% due 5/1/12(d) 3,081,375
3,000,000 NR 7.750% due 5/1/27(a)(d) 3,446,250
2,000,000 AAA Tampa, FL Revenue, Health Systems, Catholic Health, Series A-1,
MBIA-Insured, 4.875% due 11/15/18 1,965,000
3,115,000 AAA Tampa-Hillsborough County, FL Expressway Authority Revenue,
AMBAC-Insured, 5.125% due 7/1/19 3,153,938
2,180,000 AAA Village Center, FL Community Development District, Recreational
Revenue, Series A, MBIA-Insured, 5.850% due 11/1/16 2,457,950
- ------------------------------------------------------------------------------------------------------------------------------------
172,872,525
- ------------------------------------------------------------------------------------------------------------------------------------
Georgia -- 0.2%
580,000 AA- Brunswick, GA Housing Authority, Multi-Family Housing Revenue,
Cypress Mill, FHA-Insured, 9.750% due 8/1/26 631,475
Burke County, GA Development Authority, PCR,
Georgia Power Co. Vogtle:
4,000,000 VMIG 1* 2nd Series, 3.250% due 4/1/25(b) 4,000,000
4,800,000 VMIG 1* 3rd Series, 3.250% due 9/1/25(b) 4,800,000
- ------------------------------------------------------------------------------------------------------------------------------------
9,431,475
- ------------------------------------------------------------------------------------------------------------------------------------
Hawaii -- 0.1%
3,000,000 AAA Hawaii State GO, Series CP, FGIC-Insured, 5.000% due 10/1/17 3,003,750
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois -- 1.7%
2,000,000 AAA Chicago, IL GO, Series 1993, FGIC-Insured, 5.375% due 1/1/13 2,062,500
12,500,000 AAA Chicago, IL O'Hare International Airport Revenue, Series C,
MBIA-Insured, 5.000% due 1/1/18 12,453,125
3,000,000 AAA Eastern Illinois University Revenue, Auxiliary Facilities Systems,
AMBAC-Insured, 5.000% due 4/1/16 2,988,750
5,295,000 AAA Illinois Developmental Finance Authority, Hospital Revenue,
Sisters of St. Francis Health Service, MBIA-Insured,
5.375% due 11/1/27 5,407,519
Illinois Health Facilities Authority Revenue:
2,000,000 AAA Edward Obligation Group, Series A, AMBAC-Insured,
5.250% due 2/15/17 2,035,000
6,680,000 AAA Memorial Health Systems, MBIA-Insured, 5.250% due 10/1/18 6,805,250
500,000 AAA Rockford Health Systems, AMBAC-Insured, 5.100% due 8/15/11 516,250
3,000,000 AAA Sherman Health Systems, AMBAC-Insured,
5.250% due 8/1/17 3,060,000
3,790,000 AAA Illinois State Civic Center, Special State Obligation, AMBAC-Insured,
5.000% due 12/15/13 3,846,850
3,000,000 AAA Illinois State COP, Department of Central Management Services,
Public Aid Building, MBIA-Insured, 5.650% due 7/1/17 3,198,750
Illinois State GO, FGIC-Insured:
3,300,000 AAA 5.375% due 2/1/19 3,394,875
14,375,000 AAA 5.250% due 12/1/20 14,626,562
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 11
<PAGE>
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Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Illinois -- 1.7% (continued)
$ 2,230,000 VMIG 1* Madison County, IL Environmental Improvement Revenue,
Shell Wood River Refining, 3.450% due 4/1/32(a)(c) $ 2,230,000
2,000,000 AAA Springfield, IL GO, Series C, MBIA-Insured, 5.375% due 12/1/21 2,052,500
1,000,000 AAA University of Illinois Revenue Bonds, Auxiliary Facilities Systems,
MBIA-Insured, 5.375% due 10/1/13 1,047,500
- ------------------------------------------------------------------------------------------------------------------------------------
65,725,431
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana -- 1.2%
4,700,000 AAA Avon, IN Community School Building Corp., First Mortgage,
AMBAC-Insured, 5.250% due 1/1/22 4,776,375
6,310,000 AAA Delaware County, IN Hospital Authority, Hospital Authority,
Cardinal Health Systems, AMBAC-Insured, 5.000% due 8/1/16 6,317,887
1,135,000 VMIG 1* Hammond, IN PCR, (Amoco Oil Co. Project), 3.300% due 2/1/22(b) 1,135,000
3,005,000 AAA Indiana Bond Bank, State Revenue, Guarantee-State Revolving Fund,
(Project A), 6.250% due 2/1/09 3,305,500
Indiana Health Facilities Financing Authority Hospital Revenue,
Riverview Hospital:
255,000 Baa1* 6.200% due 8/1/99 259,661
305,000 Baa1* 6.500% due 8/1/01 322,537
200,000 Baa1* 6.600% due 8/1/02 215,000
Indiana Municipal Power Agency, Power Supply Systems Revenue,
Special Obligation, 1st Crossover, Series B, MBIA-Insured:
2,700,000 AAA 5.200% due 1/1/14 2,713,500
2,775,000 AAA 5.250% due 1/1/15 2,788,875
Mishawaka, IN School City, Multi-School Building Corp.:
2,000,000 A 5.500% due 7/15/15 2,092,500
3,000,000 A 5.300% due 7/15/18 3,045,000
15,000,000 AAA Rockport, IN PCR, (Michigan Power Co. Project), Series A,
AMBAC-Insured, 6.550% due 6/1/25(a) 16,518,750
1,900,000 AAA Whiting, IN Industrial Sewer & Solid Waste Disposal Revenue,
(Amoco Oil Co. Project), 3.450% due 1/1/26(b)(c) 1,900,000
- ------------------------------------------------------------------------------------------------------------------------------------
45,390,585
- ------------------------------------------------------------------------------------------------------------------------------------
Iowa -- 0.1%
5,300,000 AA Polk County, IA Revenue, Catholic Health Initiatives, Series A,
5.000% due 12/1/18 5,247,000
- ------------------------------------------------------------------------------------------------------------------------------------
Kansas -- 0.1%
1,100,000 AA Kansas State Development Finance Authority Revenue,
Catholic Health Initiatives, Series J, 5.000% due 12/1/18 1,097,250
1,000,000 AAA Wellington, KS Electric Waterworks & Sewer
Utilities Systems Revenue, AMBAC-Insured, 5.200% due 5/1/23 1,011,250
- ------------------------------------------------------------------------------------------------------------------------------------
2,108,500
- ------------------------------------------------------------------------------------------------------------------------------------
Kentucky -- 0.2%
7,520,000 AA Kentucky Economic Development Finance Authority Revenue,
Catholic Health Initiatives, Series A, 5.000% due 12/1/18 7,444,800
- ------------------------------------------------------------------------------------------------------------------------------------
Louisiana -- 0.3%
2,900,000 VMIG 1* Louisiana State Offshore Terminal Authority, Deepwater Port Revenue,
1st Stage A, Loop Inc., 3.200% due 9/1/08(b) 2,900,000
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
12 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Louisiana -- 0.3% (continued)
Orleans Parish, LA Parishwide School District,
Series A, FGIC-Insured:
$ 1,680,000 Aaa* 5.125% due 9/1/14 $ 1,711,500
1,775,000 Aaa* 5.125% due 9/1/15 1,801,625
300,000 A-1+ Plaquemines Parish, LA Environmental Revenue, BP Explosives &
Oil, 3.500% due 10/1/24(b)(c) 300,000
3,865,000 AAA Terrebonne Parish, LA Hospital Service District Number 1,
Hospital Revenue, (Terrebonne General Medical Center Project),
AMBAC-Insured, 5.350% due 4/1/17 3,971,288
- ------------------------------------------------------------------------------------------------------------------------------------
10,684,413
- ------------------------------------------------------------------------------------------------------------------------------------
Maine -- 0.3%
5,000,000 AAA Maine Health & Higher Education Facilities Authority Revenue,
Series A, FSA-Insured, 5.000% due 7/1/18 5,006,250
6,000,000 AAA Maine Municipal Bond Bank, Series C, 5.350% due 11/1/18 6,165,000
- ------------------------------------------------------------------------------------------------------------------------------------
11,171,250
- ------------------------------------------------------------------------------------------------------------------------------------
Maryland -- 0.8%
Baltimore, MD GO, Series A, FGIC-Insured:
2,585,000 AAA 5.625% due 10/15/14 2,791,800
2,745,000 AAA 5.750% due 10/15/15 3,074,400
1,165,000 AAA 5.750% due 10/15/16 1,304,800
2,000,000 AAA Baltimore, MD Mortgage Revenue, (Northbrooke Apartments Project),
GNMA-Collateralized, Series A, 6.350% due 1/20/21(a) 2,160,000
1,375,000 AAA Charles County, MD Mortgage Revenue, (Holly Station Project),
Series A, FHA-Insured, 6.450% due 5/1/26 1,476,406
750,000 Aa2* Maryland State Community Development Administration,
Department of Housing & Community Development, Series C,
5.550% due 7/1/27(c) 766,875
56,000,000 NR Maryland State Energy Financing Administration,
Solid Waste Disposal Revenue, (Hagerstown Project),
9.000% due 10/15/16(a)(c)(f) 17,360,000
1,750,000 Aa2* Montgomery County, MD Housing Opportunities Community,
Single-Family Mortgage Revenue, Series A, 5.750% due 7/1/13 1,868,125
- ------------------------------------------------------------------------------------------------------------------------------------
30,802,406
- ------------------------------------------------------------------------------------------------------------------------------------
Massachusetts -- 5.4%
2,595,000 AAA Boston, MA GO, Series B, FGIC-Insured, 5.250% due 4/1/15 2,669,606
2,200,000 AAA Holyoke, MA GO, Series A, FSA-Insured, 5.500% due 6/15/16 2,304,500
Massachusetts Bay Transportation Authority, Series B,
General Transportation System:
AMBAC-Insured:
20,380,000 AAA 5.375% due 3/1/20 20,889,500
12,790,000 AAA 5.375% due 3/1/25 13,093,762
FSA-Insured:
15,000,000 AAA 5.250% due 3/1/20 15,262,500
32,200,000 AAA 5.250% due 3/1/26 32,602,500
Massachusetts Municipal Wholesale Electric Co., Power Supply
System Revenue:
Series A, AMBAC-Insured:
11,900,000 AAA 5.000% due 7/1/14 11,974,375
2,950,000 AAA 5.000% due 7/1/17 2,946,312
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 13
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Massachusetts -- 5.4% (continued)
$ 9,435,000 AAA Series B, MBIA-Insured, 5.000% due 7/1/17 $ 9,423,206
4,000,000 AA- Massachusetts State GO, Construction Lien, Series C,
5.250% due 8/1/16 4,100,000
Massachusetts State Health and Educational Facilities
Authority Revenue:
2,000,000 A Hebrew Rehabilitation Center for Aged, Series C,
5.250% due 7/1/17 2,022,500
1,970,000 AAA Northeastern University, Series G, 5.000% due 10/1/17 1,972,462
9,500,000 AAA Massachusetts State Housing Finance Agency,
Housing Development, Series A, MBIA-Insured,
5.300% due 12/1/17(a) 9,654,375
Massachusetts State Industrial Finance Agency Revenue:
31,700,000 NR Solid Waste Disposal Revenue, Massachusetts Recycling
Association, Series A, 9.000% due 8/1/16(a)(c)(f) 11,887,500
1,765,000 AAA Worcester Polytechnic Institute, MBIA-Insured,
5.125% due 9/1/12 1,820,156
5,000,000 AA Massachusetts State Special Obligation Revenue, Series A,
5.000% due 6/1/17 5,018,750
Massachusetts State Water Resources Authority:
27,785,000 AAA MBIA-Insured, 5.000% due 12/1/25
Series B: 27,611,344
3,000,000 A 5.500% due 3/1/17 3,105,000
9,000,000 AAA MBIA-Insured, 4.000% due 12/1/18 7,852,500
9,635,000 AAA MBIA-Insured, 4.750% due 12/1/21 9,261,644
8,000,000 AAA Series C, MBIA-Insured, 5.250% due 12/1/20 8,110,000
- ------------------------------------------------------------------------------------------------------------------------------------
203,582,492
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan -- 5.8%
2,000,000 AAA Battle Creek, MI Downtown Development Authority, MBIA-Insured,
5.000% due 5/1/17 2,010,000
4,000,000 AAA Byron Center, MI Public Schools, GO, FSA-Insured,
5.000% due 5/1/18 4,005,000
18,000,000 AAA Detroit & Wayne Counties, MI Stadium Authority Revenue,
FGIC-Insured, 5.250% due 2/1/27 18,225,000
6,000,000 AAA Ferris State University Revenue, AMBAC-Insured,
5.000% due 10/1/18 6,007,500
2,090,000 AAA Grand Valley, MI State University Revenue, MBIA-Insured,
5.250% due 10/1/17 2,163,150
2,140,000 AAA Ingham County, MI Building Authority, AMBAC-Insured,
5.000% due 11/1/16 2,150,700
1,200,000 AAA Leslie, MI Public Schools, Ingham & Jackson Counties, GO,
FGIC-Insured, 5.000% due 5/1/18 1,201,500
22,625,000 AA+ Michigan Municipal Board Authority, PCR, 5.125% due 10/1/20 22,879,531
39,340,000 AAA Michigan Public Power Agency Revenue, (Belle River Project),
Series A, MBIA-Insured, 5.250% due 1/1/18 39,880,925
Michigan State Hospital Finance Authority Revenue:
5,000,000 AAA Botsford Obligation, Series A, MBIA-Insured,
5.000% due 2/15/18 4,968,750
1,000,000 AAA Mercy Health Services, AMBAC-Insured, Series R,
5.375% due 8/15/16 1,030,000
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
14 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Michigan -- 5.8% (continued)
$ 4,000,000 AAA Oakwood Obligation Group, Series A, FSA-Insured,
5.000% due 8/15/18 $ 3,985,000
Michigan State Housing Representatives, COP, AMBAC-Insured:
5,145,000 AAA 5.000% due 8/15/16 5,119,275
4,715,000 AAA 5.500% due 8/15/15 4,921,281
Michigan State Strategic Fund:
1,400,000 P-1* PCR, (Consumers Power Project), 3.300% due 4/15/18(b) 1,400,000
Resource Recovery Limited Obligation Revenue,
Central Wayne Energy, Series A:
8,000,000 NR 6.900% due 7/1/19(c) 8,150,000
3,000,000 NR 7.000% due 7/1/27(c) 3,056,250
12,000,000 NR Series B, 6.800% due 7/1/13(c) 12,225,000
56,625,000 NR Midland County, MI Economic Development Corp., PCR,
Subordinated Limited Obligation, Series B,
9.500% due 7/23/09(a)(c) 61,862,813
3,000,000 AAA Northern Michigan University Revenue, MBIA-Insured,
5.125% due 12/1/20 3,045,000
2,215,000 AAA Redford, MI Unified School District, GO, AMBAC-Insured,
5.125% due 5/1/18 2,234,381
1,300,000 AAA Rockford, MI Public Schools, GO, FGIC-Insured, 5.250% due 5/1/27 1,316,250
4,955,000 AA Royal Oak, MI Hospital Finance Authority, Hospital Revenue,
William Beaumont Hospital, 5.250% due 1/1/20 4,979,775
1,000,000 AAA South Lyon, MI Community Schools, FGIC-Insured,
5.125% due 5/1/16 1,015,000
3,900,000 A-1+ University of Michigan, University Revenues, Hospital Series A-2,
3.300% due 12/1/24(b) 3,900,000
- ------------------------------------------------------------------------------------------------------------------------------------
221,732,081
- ------------------------------------------------------------------------------------------------------------------------------------
Minnesota -- 0.3%
Hennepin County, MN Lease Revenue, COP:
2,955,000 AA 5.000% due 11/15/14 3,003,019
3,105,000 AA 5.000% due 11/15/15 3,143,813
5,000,000 AA+ North St. Paul, MN ISD 622, Series A, 5.125% due 2/1/20 5,037,500
- ------------------------------------------------------------------------------------------------------------------------------------
11,184,332
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi -- 0.2%
1,000,000 AAA Harrison County, MS School District, State Aid Capital Improvement,
FSA-Insured, 5.000% due 8/1/15 1,008,750
1,300,000 P-1 Jackson County, MS PCR, (Chevron U.S.A. Inc. Project),
3.250% due 6/1/23(b) 1,300,000
Jackson, MS Municipal Airport Authority, Airport Revenue, Series A,
AMBAC-Insured:
385,000 AAA 5.000% due 12/1/12 394,625
405,000 AAA 5.100% due 12/1/13 412,594
425,000 AAA 5.125% due 12/1/14 432,437
450,000 AAA 5.125% due 12/1/15 456,187
470,000 AAA 5.125% due 12/1/16 474,700
750,000 AAA 5.125% due 12/1/21 753,750
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 15
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<S> <C> <C> <C>
Mississippi -- 0.2% (continued)
$ 2,000,000 P-1* Perry County, MS PCR, (Leaf River Forest Project),
3.250% due 3/1/02(b) $ 2,000,000
- ------------------------------------------------------------------------------------------------------------------------------------
7,233,043
- ------------------------------------------------------------------------------------------------------------------------------------
Missouri -- 1.5%
4,750,000 AAA Fenton, MO COP, (Capital Improvements Project), MBIA-Insured,
5.125% due 9/1/17 4,815,312
24,635,000 AAA Kansas City, MO Municipal Assistance Corp., Series A,
MBIA-Insured, 5.000% due 4/15/20 24,635,000
Missouri State Environmental Import & Energy Resource Authority,
PCR, State Revolving Fund:
3,380,000 Aa1* Series A, 5.000% due 1/1/19 3,396,900
Series E:
1,040,000 Aa1* 5.200% due 1/1/10 1,098,500
2,235,000 Aa1* 5.250% due 1/1/19 2,290,875
Poplar Bluff, MO Public Building Corp., Leasehold Revenue,
MBIA-Insured:
1,025,000 Aaa* 5.000% due 9/1/13 1,032,688
4,475,000 Aaa* 5.100% due 9/1/18 4,491,781
St. Louis, MO Board of Education, GO, Direct Deposit Program,
FGIC-Insured:
3,235,000 AAA 5.000% due 4/1/15 3,255,219
3,790,000 AAA 5.000% due 4/1/17 3,804,213
4,900,000 AAA St. Louis, MO Regional Convention & Sports Complex Authority,
AMBAC-Insured, 5.300% due 8/15/20 4,991,875
University of Missouri Health Facilities Revenue,
University of Missouri Health Systems, Series A, AMBAC-Insured:
2,560,000 AAA 5.000% due 11/1/18 2,540,800
1,000,000 AAA 5.125% due 11/1/28 997,500
- ------------------------------------------------------------------------------------------------------------------------------------
57,350,663
- ------------------------------------------------------------------------------------------------------------------------------------
Montana -- 0.9%
33,400,000 NR Montana State Board, Resource Recovery Revenue, (Yellowstone
Energy LP Project), 7.000% due 12/31/19(a)(c) 34,026,250
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska -- 0.4%
14,300,000 AAA Nebraska Public Power District Revenue, Electric System Revenue,
Series A, MBIA-Insured, 5.250% due 1/1/28(a) 15,283,125
- ------------------------------------------------------------------------------------------------------------------------------------
Nevada -- 1.4%
Clark County, NV GO, Series A, FGIC-Insured:
6,035,000 AAA 5.000% due 6/1/15 6,102,894
6,340,000 AAA 5.000% due 6/1/16 6,395,475
20,000,000 AAA 5.000% due 6/1/19 19,950,000
21,000,000 AAA Clark County, NV Passenger Facility Charge Revenue, Las Vegas
McCarran International, MBIA-Insured, 5.000% due 7/1/18 20,973,750
- ------------------------------------------------------------------------------------------------------------------------------------
53,422,119
- ------------------------------------------------------------------------------------------------------------------------------------
New Jersey -- 0.7%
5,000,000 AAA Casino Reinvestment Development Authority, Parking
Fee Revenue, Series A, FSA-Insured, 5.250% due 10/1/16 5,106,250
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
16 1998 Semi-Annual Report to Shareholders
<PAGE>
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<TABLE>
<CAPTION>
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AMOUNT RATING SECURITY VALUE
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<S> <C> <C> <C>
New Jersey -- 0.7% (continued)
$ 2,000,000 AAA Hamilton Township, Atlantic County, NJ Municipal Utilities Authority,
FGIC-Insured, 5.000% due 8/15/17 $ 2,012,500
Mercer County, NJ Improvement Authority Revenue, County Golf
Course Project, FGIC-Insured:
1,405,000 AAA 5.000% due 12/1/15 1,415,537
750,000 AAA 5.000% due 12/1/18 752,812
Middlesex County, NJ COP, MBIA-Insured:
1,280,000 AAA 5.000% due 6/15/12 1,307,200
1,345,000 AAA 5.050% due 6/15/13 1,375,263
1,410,000 AAA 5.100% due 6/15/14 1,438,200
Monmouth County, NJ Improvement Authority Revenue,
AMBAC-Insured:
1,000,000 AAA 5.050% due 12/1/14 1,020,000
500,000 AAA 5.150% due 12/1/17 514,375
300,000 A-1+ New Jersey EDA, Economic Development Revenue,
Foreign Trade Zone Project, 3.100% due 12/1/07(b) 300,000
2,500,000 Aaa* New Jersey EDA Revenue, (Hillcrest Health Service Systems Project),
AMBAC-Insured, 5.375 due 1/1/16 2,590,625
New Jersey Health Care Facilities Financing Authority Revenue:
3,250,000 AAA Cathedral Health Services, MBIA-Insured, 5.200% due 8/1/15 3,335,313
Rahway Hospital Obligation Group:
2,500,000 BBB 5.000% due 7/1/08 2,525,000
1,225,000 BBB 5.125% due 7/1/14 1,218,875
1,250,000 A New Jersey State Educational Facilities Authority Revenue, Stevens
Institute of Technology, Series I, 5.000% due 7/1/18 1,237,500
- ------------------------------------------------------------------------------------------------------------------------------------
26,149,450
- ------------------------------------------------------------------------------------------------------------------------------------
New Mexico -- 0.1%
3,480,000 Aaa* Santa Fe, NM Single-Family Mortgage Revenue,
FNMA & GNMA-Collateralized, 6.300% due 11/1/28(c) 3,697,500
- ------------------------------------------------------------------------------------------------------------------------------------
New York -- 10.8%
1,710,000 AA Housing Corp. of New York Revenue, 5.500% due 11/1/20 1,733,512
Long Island Power Authority, NY Electrical Systems Revenue,
Series A, FSA-Insured:
33,000,000 AAA 5.000% due 12/1/15 33,371,250
56,120,000 AAA 5.125% due 12/1/16 56,891,650
9,185,000 AAA 5.300% due 12/1/19 9,426,106
5,500,000 AAA Metropolitan Transportation Authority, NY Commuter Facilities
Revenue, Series A, FSA-Insured, 5.000% due 7/1/23 5,493,125
1,100,000 AA Monroe County, NY Water Authority Revenue, 5.000% due 8/1/19 1,100,000
2,695,000 AAA New York City, NY Education Construction Fund Revenue,
AMBAC-Insured, 5.500% due 4/1/16 2,849,963
1,280,000 AAA New York City, NY IDA, Civic Facilities Revenue, (Trinity Episcopal
School Corp. Project ), MBIA-Insured, 5.250% due 6/15/17 1,312,000
New York City, NY Municipal Water Financing Authority,
Water & Sewer Revenue:
11,950,000 AAA MBIA-Insured, 5.375% due 6/15/19 12,218,875
6,145,000 AAA Series A, AMBAC-Insured, 5.125% due 6/15/22 6,198,769
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 17
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AMOUNT RATING SECURITY VALUE
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<S> <C> <C> <C>
New York -- 10.8% (continued)
New York City, NY Transitional Finance Authority Revenue,
Future Tax Secured:
$ 2,310,000 AA Series A, 5.000% due 8/15/17 $ 2,310,000
Series C, FGIC-Insured:
2,530,000 AAA 5.000% due 5/1/16 2,552,138
9,165,000 AAA 5.000% due 5/1/17 9,222,281
New York State Dormitory Authority:
City University:
Series A, FGIC-Insured:
6,000,000 AAA 5.375% due 7/1/14(a) 6,225,000
16,500,000 AAA Systems Constructions Second, 5.000% due 7/1/16 16,623,750
5,000,000 AAA Series 2, MBIA-Insured, 6.250% due 7/1/19 5,643,750
1,000,000 Aaa* Culinary Institute, FHA/MBIA-Insured, 5.000% due 7/1/17 1,010,000
1,000,000 AAA Fordham University, MBIA-Insured, 5.000% due 7/1/18 1,002,500
8,000,000 AAA Hospital Special Surgery, MBIA-Insured, 5.000% due 2/1/18 7,980,000
Iona College, MBIA-Insured:
485,000 AAA 6.600% due 7/1/07 526,831
420,000 AAA 6.600% due 7/1/08 455,175
555,000 AAA 6.600% due 7/1/09 600,788
540,000 AAA 6.700% due 7/1/10 585,900
Mental Health Services Facilities Improvement, FSA-Insured:
9,000,000 AAA Series C, 5.125% due 8/15/17 9,090,000
2,000,000 AAA Series D, 5.125% due 8/15/17 2,020,000
20,765,000 AAA Montefiore Medical Center, AMBAC-Insured, 5.250% due 2/1/15 21,154,344
4,500,000 AAA Municipal Health Facilities, Series A, FSA-Insured,
5.500% due 5/15/24 4,691,250
5,000,000 AAA North General Hospital, Series G, AMBAC-Insured,
5.200% due 2/15/15 5,081,250
State University Educational Facilities:
5,160,000 A* 5.000% due 5/15/13 5,179,350
Series A, MBIA-Insured:
6,195,000 AAA 5.000% due 5/15/15 6,249,206
7,030,000 AAA 5.000% due 5/15/16 7,082,725
13,635,000 AAA 5.000% due 5/15/17 13,686,131
5,265,000 AAA 5.000% due 5/15/18 5,271,581
17,550,000 AAA 5.000% due 5/15/20 17,528,063
University of Rochester, Series A, MBIA-Insured:
3,915,000 AAA 5.000% due 7/1/16 3,949,256
2,000,000 AAA 5.000% due 7/1/17 2,007,500
2,000,000 AAA 5.000% due 7/1/18 2,002,500
4,050,000 AAA Wyndham Schools, Series C, AMBAC-Insured, 5.000% due 7/1/18 4,039,875
New York State Environmental Facilities Corp., State Clean Water
& Drinking, Revolving Funds:
5,520,000 Aa2* Series C, 5.000% due 6/15/16 5,533,800
12,125,000 Aa2* Series F, 5.000% due 6/15/15 12,215,938
2,000,000 A New York State GO, 12.000% due 11/15/03 2,737,500
New York State Local Government Assistance Corp., Series B,
MBIA-Insured:
12,090,000 AAA 4.750% due 4/1/15 11,938,875
18,000,000 AAA 4.875% due 4/1/20 17,662,500
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
18 1998 Semi-Annual Report to Shareholders
<PAGE>
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<TABLE>
<CAPTION>
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AMOUNT RATING SECURITY VALUE
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<S> <C> <C> <C>
New York -- 10.8% (continued)
$ 6,000,000 AAA New York State Medical Care Facilities, Financing Agency Revenue,
FGIC-Insured, 5.250% due 2/15/19 $ 6,067,500
13,895,000 Aa2* New York State Mortgage Agency Revenue, Homeowner Mortgage,
Series 72, 5.200% due 10/1/16 14,033,950
10,000,000 AAA New York State Thruway Authority, Highway & Bridge Toll Road Fund,
Series A, FGIC-Insured, 5.000% due 4/1/18 10,012,500
New York State Urban Development Corp. Revenue:
4,000,000 AAA AMBAC-Insured, 5.250% due 1/1/18 4,045,000
3,250,000 AAA FSA-Insured, 5.250% due 1/1/21 3,282,500
1,000,000 AAA St. Lawrence County, NY Industrial Developmental Civic Facilities
Revenue, St. Lawrence University Project, Series A, MBIA-Insured,
5.375% due 7/1/18 1,040,000
Triborough Bridge & Tunnel Authority of New York, General
Purpose Revenue Bonds, Series A:
10,000,000 Aa3* 5.200% due 1/1/20 10,087,500
12,000,000 Aa3* 5.000% due 1/1/24 11,820,000
1,100,000 AAA Troy City, NY Municipal Assistance Corp., Series A, MBIA-Insured,
5.000% due 1/15/16 1,105,500
Yonkers, NY GO, FGIC-Insured:
1,125,000 AAA Series A, 5.000% due 9/1/14 1,136,250
2,000,000 AAA Series B, 5.000% due 9/1/17 1,987,500
- ------------------------------------------------------------------------------------------------------------------------------------
409,073,207
- ------------------------------------------------------------------------------------------------------------------------------------
North Carolina -- 2.3%
4,500,000 A2* Carteret County, NC COP, (Elementary School Project),
6.500% due 2/1/07 4,882,500
1,000,000 AAA Centennial Authority Hotel Tax Revenue, (Arena Project),
FSA-Insured, 5.125% due 9/1/15 1,031,250
1,750,000 AAA New Hanover County, NC COP, (New Hanover Project), MBIA-Insured,
5.000% due 12/1/17 1,756,563
3,000,000 AA North Carolina Housing Finance Agency, Home Ownership,
Series A-1, 5.350% due 1/1/17(c) 3,033,750
3,780,000 AA North Carolina Medical Care, Community Health Care Facilities
Revenue, (Carolina Medicorp Project), 5.125% due 5/1/16 3,803,625
North Carolina Medical Care Community Hospital Revenue:
Gaston Health Care:
2,000,000 A+ 5.000% due 12/15/12 2,007,500
4,500,000 A+ 5.000% due 2/15/19 4,410,000
6,000,000 AA- Pitt County Memorial Hospital, Series A, 5.000% due 12/1/18 5,917,500
North Carolina Municipal Power Agency, Catawaba Electric Revenue,
Series A:
16,755,000 AAA AMBAC-Insured, 5.375% due 1/1/20(a) 17,236,706
MBIA-Insured:
8,860,000 AAA 5.125% due 1/1/15 9,059,350
18,850,000 AAA 5.125% due 1/1/17 19,179,875
15,000,000 AAA 5.125% due 1/1/17 15,281,250
- ------------------------------------------------------------------------------------------------------------------------------------
87,599,869
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 19
<PAGE>
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Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
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AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
North Dakota -- 0.5%
$ 1,000,000 AAA Fargo, ND Water Revenue, MBIA-Insured, 5.125% due 1/1/14 $ 1,025,000
18,500,000 AAA Oliver County, ND PCR, Square Butte Electrical Co-op, Series A,
AMBAC-Insured, 5.300% due 1/1/27 18,823,750
- ------------------------------------------------------------------------------------------------------------------------------------
19,848,750
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio -- 4.2%
Akron, Bath and Copley, OH Joint Township, Hospital Revenue
Bonds, Akron General Medical Center Project, AMBAC-Insured:
14,630,000 AAA 5.375% due 1/1/17(a) 15,324,925
18,000,000 AAA 5.375% due 1/1/22 18,607,500
3,000,000 Aaa* Akron-Summit County, OH Public Library, GO, Series A, FGIC-Insured,
5.000% due 12/1/15 3,030,000
8,375,000 AAA Akron, OH Economic Development, MBIA-Insured,
5.000% due 12/1/18 8,406,406
3,500,000 AA- Akron, OH GO, 5.000% due 12/1/18 3,508,750
1,000,000 Aaa* Brecksville-Broadview Heights, OH City School District, FGIC-Insured,
6.500% due 12/1/16 1,146,250
12,950,000 AAA Butler County, OH Transportation Improvement District, Series A,
FSA-Insured, 5.125% due 4/1/17 13,209,000
Clermont County, OH Hospital Facility Revenue, Mercy Health
Systems, Series B, AMBAC-Insured:
3,415,000 AAA 5.625% due 9/1/16 3,636,975
1,000,000 AAA 5.625% due 9/1/21 1,058,750
Cleveland, OH Waterworks Revenue, Refunding & Improvement,
First Mortgage, Series H, MBIA-Insured:
1,000,000 AAA 5.625% due 1/1/13 1,072,500
1,000,000 AAA 5.700% due 1/1/14 1,108,750
Cuyahoga County, OH Hospital Revenue, Metrohealth System,
MBIA-Insured:
1,000,000 AAA 5.375% due 2/15/12 1,056,250
1,000,000 AAA 5.625% due 2/15/17 1,065,000
Series A:
5,180,000 AAA 5.500% due 2/15/12(a) 5,659,150
5,050,000 AAA 5.125% due 2/15/13(a) 5,182,562
6,680,000 AAA 5.125% due 2/15/15 6,813,600
3,025,000 AAA 5.125% due 2/15/16 3,089,281
4,890,000 AAA 5.125% due 2/15/17 4,981,687
13,935,000 AAA 5.250% due 2/15/19 14,196,281
3,000,000 AAA Cuyahoga County, OH Port Authority Revenue, Rock & Roll Hall of
Fame, AMBAC-Insured, 5.400% due 12/1/15 3,131,250
4,065,000 AAA Franklin County, OH Convention Facilities Authority, Tax & Lease
Revenue Anticipation Bonds, MBIA-Insured, 5.000% due 12/1/17 4,100,569
5,000,000 Aaa* Greater Cleveland Regional Transportation Authority, OH GO,
FGIC-Insured, 5.000% due 12/1/18 5,006,250
1,520,000 Aa3* Lakewood, OH GO, 5.125% due 12/1/17 1,533,300
3,000,000 Aaa* Medina, OH City School District, GO, FGIC-Insured,
5.000% due 12/1/18 3,003,750
850,000 Aaa* Mount Vernon, OH Water System Improvement, AMBAC-Insured,
5.125% due 12/1/18 859,563
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
20 1998 Semi-Annual Report to Shareholders
<PAGE>
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Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
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FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Ohio -- 4.2% (continued)
$ 2,095,000 AAA Northwest, OH Local School District, GO, FGIC-Insured,
5.150% due 12/1/22 $ 2,118,569
Ohio State Building Authority, State Facilities,
Administration Building Fund Projects, Series A:
5,675,000 AA- 5.000% due 4/1/15 5,731,750
2,725,000 AA- 5.000% due 10/1/15 2,752,250
5,010,000 AA- 5.000% due 4/1/16 5,047,575
1,500,000 NR Ohio State Solid Waste Revenue, Republic Engineered Steels Inc.,
9.000% due 6/1/21(c) 1,678,125
2,670,000 AAA Ohio State Water Development Authority Revenue, Water
Development, Fresh Water Series, FSA-Insured,
5.000% due 12/1/16 2,693,363
2,955,000 AAA Parma, OH GO, Series A, FGIC-Insured, 5.000% due 12/1/18 2,958,694
1,585,000 AAA Twinsburg, OH Local School District, FGIC-Insured,
5.900% due 12/1/21 1,731,613
University of Akron, OH General Revenue, AMBAC-Insured:
1,000,000 AAA 5.125% due 1/1/11 1,040,000
1,000,000 AAA 5.125% due 1/1/12 1,032,500
2,525,000 AAA 5.250% due 1/1/22 2,572,344
1,000,000 Aa2* Upper Arlington, OH GO, Series B, 4.875% due 12/1/17 990,000
- ------------------------------------------------------------------------------------------------------------------------------------
160,135,082
- ------------------------------------------------------------------------------------------------------------------------------------
Oklahoma -- 0.8%
Oklahoma State Turnpike Authority, Turnpike Revenue, Series A,
FGIC-Insured:
10,545,000 AAA 5.000% due 1/1/14 10,755,900
12,140,000 AAA 5.000% due 1/1/15 12,337,275
4,500,000 AAA 5.000% due 1/1/18 4,539,375
1,975,000 AA Tulsa, OK Industrial Authority, Hospital Revenue, St. John's Medical
Center, 6.250% due 2/15/17 2,137,938
1,000,000 AA- Woods County, OK IDA, Revenue Refunding, (Cargill Inc. Project),
6.250% due 10/1/14 1,100,000
- ------------------------------------------------------------------------------------------------------------------------------------
30,870,488
- ------------------------------------------------------------------------------------------------------------------------------------
Oregon -- 0.4%
Clackamas & Washington Counties, OR School District No. 003,
FGIC-Insured:
2,860,000 AAA 5.000% due 6/1/15 2,892,175
3,555,000 AAA 5.000% due 6/1/16 3,586,106
1,685,000 AAA 5.000% due 6/1/17 1,693,425
6,950,000 AA Oregon State GO, Series B, 6.375% due 8/1/24(a) 7,575,500
- ------------------------------------------------------------------------------------------------------------------------------------
15,747,206
- ------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania -- 3.5%
Allegheny County, PA Airport Revenue, Pittsburgh International
Airport, Series B, MBIA-Insured:
5,000,000 AAA 5.000% due 1/1/17 5,006,250
6,500,000 AAA 5.000% due 1/1/19 6,483,750
14,300,000 AAA Altoona, PA City Authority Water Revenue, FGIC-Insured,
5.000% due 11/1/19 14,264,250
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 21
<PAGE>
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Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
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FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Pennsylvania -- 3.5% (continued)
Delaware County, PA Interboro School District, GO, MBIA-Insured:
$ 985,000 AAA 5.150% due 8/15/13 $ 1,010,856
935,000 AAA 5.200% due 8/15/14 959,544
1,150,000 AAA 5.300% due 8/15/17 1,180,187
1,600,000 AAA 5.375% due 8/15/22 1,642,000
Fairview, PA School District, GO, FGIC-Insured:
2,620,000 AAA 5.200% due 2/15/15 2,678,950
3,345,000 AAA 5.000% due 2/15/18 3,349,181
5,000,000 AAA Gettysburg, PA Municipal Authority, College Revenue, MBIA-Insured,
5.000% due 8/15/18 5,000,000
4,835,000 Aaa* Lehigh County, PA General Purpose Authority Revenues,
Lehigh Valley Health Network, Series A, MBIA-Insured,
5.000% due 7/1/18 4,810,825
3,240,000 AAA Lewisburg, PA Area School District, MBIA-Insured,
5.125% due 3/15/18 3,268,350
1,290,000 Aaa* Lower Bucks County, PA Joint Municipal Authority,
Sewer & Water Revenue, FSA-Insured, 5.000% due 11/15/17 1,291,612
6,000,000 AAA Montgomery County, PA Higher Education & Health Authority
Revenue, Holy Redeemer Health, Series A, 5.250% due 10/1/17 6,120,000
Owen J. Roberts School District, Series A, MBIA-Insured:
1,515,000 AAA 5.200% due 5/15/12 1,566,131
1,570,000 AAA 5.250% due 5/15/13 1,626,913
1,670,000 AAA 5.300% due 5/15/14 1,724,275
Pennsylvania Economic Development Financing Authority Revenue,
(Northampton Generating Project), Series C:
2,000,000 NR 6.875% due 1/1/11(c) 2,077,500
12,000,000 NR 6.950% due 1/1/21(a)(c) 12,480,000
Pennsylvania State University:
Series A:
3,430,000 AA- 5.000% due 8/15/15 3,455,725
3,660,000 AA- 5.000% due 8/15/16 3,673,725
3,845,000 AA- 5.000% due 8/15/17 3,840,194
4,045,000 AA- 5.000% due 8/15/18 4,014,663
Series B:
1,035,000 AA- 5.000% due 8/15/15 1,038,881
1,090,000 AA- 5.000% due 8/15/16 1,094,088
Philadelphia, PA School District, GO, Series B, AMBAC-Insured:
1,000,000 AAA 5.000% due 4/1/10 1,032,500
1,000,000 AAA 5.000% due 4/1/11 1,026,250
1,000,000 AAA 5.000% due 4/1/12 1,018,750
3,310,000 AAA 5.250% due 4/1/17 3,380,338
2,220,000 AAA 5.375% due 4/1/19 2,278,275
7,825,000 AAA Philadelphia, PA Water & Wastewater Revenue, Series A,
AMBAC-Insured, 5.000% due 8/1/14 7,913,031
5,000,000 AAA Pittsburgh, PA GO, 1997 Maturity 2015 & 2018, AMBAC-Insured,
5.250% due 9/1/18 5,093,750
7,225,000 AAA Pittsburgh, PA Water & Sewer Authority, Water & Sewer
Systems Revenue, Series C, FSA-Insured, 5.000% due 9/1/17 7,243,063
Saint Mary's Hospital Authority, Bucks County
Catholic Health Initiatives, Series A:
2,680,000 AA 5.375% due 12/1/12 2,800,600
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
22 1998 Semi-Annual Report to Shareholders
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<TABLE>
<CAPTION>
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AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Pennsylvania-- 3.5% (continued)
$ 5,000,000 AA 5.000% due 12/1/18 $ 4,931,250
3,100,000 AAA Scranton, PA School District, GO, AMBAC-Insured,
5.000% due 4/1/17 3,115,500
- ------------------------------------------------------------------------------------------------------------------------------------
133,491,157
- ------------------------------------------------------------------------------------------------------------------------------------
Puerto Rico -- 0.1%
5,000,000 AAA Puerto Rico Industrial, Tourist, Educational, Medical, &
Environmental Control Facilities, Inter American University,
Series A, MBIA-Insured, 5.000% due 10/1/18 5,050,000
- ------------------------------------------------------------------------------------------------------------------------------------
South Carolina -- 1.3%
Beaufort County, SC Hospital Facilities Revenue, Beaufort County
Memorial Hospital, AMBAC-Insured:
5,330,000 AAA 5.000% due 12/1/12 5,429,937
2,000,000 AAA 5.000% due 12/1/17 2,017,500
3,250,000 VMIG 1* Berkeley County, SC Pollution Control Facilities Revenue,
(Amoco Chemical Co. Project, 3.300% due 7/1/12(b) 3,250,000
Berkeley County, SC School District, COP:
3,000,000 AAA Berkeley School Facilities Group Inc., AMBAC-Insured,
5.000% due 2/1/16 3,003,750
2,625,000 AAA MBIA-Insured, 5.250% due 2/1/16 2,690,625
Citadel Military College Revenue, AMBAC-Insured:
3,000,000 AAA 5.125% due 4/1/15 3,063,750
3,115,000 AAA 5.125% due 4/1/17 3,173,406
1,585,000 AAA Hilton Head Public Service District Number 1, Waterworks &
Sewer Systems Revenue, FSA-Insured, 5.000% due 12/1/18 1,588,962
Lexington County, SC Health Services District Inc.,
Hospital Revenue, Refunding & Improvement, FSA-Insured:
7,310,000 AAA 5.250% due 11/1/17 7,465,337
5,000,000 AAA 5.125% due 11/1/26 5,025,000
Piedmont Municipal Power Agency, Electric Revenue,
Series A, MBIA-Insured:
5,300,000 AAA 5.000% due 1/1/15 5,339,750
7,015,000 AAA 4.875% due 1/1/17 6,936,081
- ------------------------------------------------------------------------------------------------------------------------------------
48,984,098
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee -- 1.1%
Chattanooga, TN Health, Educational & Housing Facility Board,
Mortgage Revenue, Red Bank Health Care, FHA-Insured:
30,000 A 11.250% due 2/1/00 32,775
90,000 A 11.250% due 8/1/00 101,137
100,000 A 11.250% due 2/1/01 115,125
105,000 A 11.250% due 8/1/01 124,031
110,000 A 11.250% due 2/1/02 132,688
115,000 A 11.250% due 8/1/02 141,881
120,000 A 11.250% due 2/1/03 150,600
130,000 A 11.250% due 8/1/03 166,562
135,000 A 11.250% due 2/1/04 174,825
145,000 A 11.250% due 8/1/04 191,219
150,000 A 11.250% due 2/1/05 201,187
180,000 A 11.250% due 8/1/05 245,475
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 23
<PAGE>
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<TABLE>
<CAPTION>
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FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Tennessee -- 1.1% (continued)
Hardeman County, TN Correctional Facilities Corp.:
$ 1,200,000 NR 6.900% due 8/1/03 $ 1,266,000
11,000,000 NR 7.750% due 8/1/17 12,347,500
6,000,000 AA Metropolitan Government of Nashville & Davidson County,
Electrical Revenue, Series A, 5.125% due 5/15/15 6,112,500
Shelby County, TN Health, Educational & Housing Facilities Board,
Hospital Revenue, Methodist Health System, MBIA-Insured:
2,445,000 AAA 5.200% due 8/1/13 2,521,406
1,465,000 AAA 5.250% due 8/1/14 1,510,781
4,885,000 AAA 5.300% due 8/1/15 5,043,763
7,755,000 AAA Tennessee State GO, Series B, 5.500% due 5/1/23(a) 8,191,219
Wilson County, TN COP, FSA-Insured:
720,000 AAA 5.100% due 3/30/11 740,700
755,000 AAA 5.150% due 3/30/12 779,538
795,000 AAA 5.200% due 3/30/13 820,838
835,000 AAA 5.250% due 3/30/14 862,138
1,250,000 AAA 5.250% due 3/30/18 1,276,563
- ------------------------------------------------------------------------------------------------------------------------------------
43,250,451
- ------------------------------------------------------------------------------------------------------------------------------------
Texas -- 19.7%
Amarillo, TX Health Facilities Corp., Baptist St. Anthony's
Hospital Corp., FSA-Insured:
4,000,000 Aaa* 5.500% due 1/1/16 4,285,000
2,000,000 Aaa* 5.000% due 1/1/22 1,972,500
7,335,000 Aaa* Arlington, TX ISD, GO, PSFG, 4.750% due 2/15/22 7,041,600
Austin, TX Utility Systems Revenue, FSA-Insured:
5,160,000 AAA 5.125% due 11/15/16 5,243,850
3,500,000 AAA 5.125% due 11/15/17 3,556,875
Austin, TX Water, Sewer & Electric Authority Revenue Bonds:
46,090,000 A* 14.000% due 11/15/01 54,559,037
740,000 A* Pre-Refunded--Escrowed with U.S. government securities
to 5/15/99 Call @ 100, 14.000% due 11/15/01(d) 789,025
690,000 A* Pre-Refunded--Escrowed with U.S. government securities to
various call dates (5/15/98 to 11/15/01) Call @ 100,
14.000% due 11/15/01(d) 781,425
Bedford, TX GO, FSA-Insured:
1,000,000 Aaa* 5.125% due 2/1/15 1,018,750
1,000,000 Aaa* 5.125% due 2/1/16 1,016,250
1,000,000 Aaa* 5.250% due 2/1/17 1,021,250
1,000,000 Aaa* 5.250% due 2/1/18 1,017,500
Bell County, TX Health Facilities Development Corp. Revenue,
Cook Childrens' Medical, FSA-Insured:
1,575,000 AAA 5.000% due 12/1/12 1,598,625
1,660,000 AAA 5.100% due 12/1/13 1,691,125
1,745,000 AAA 5.125% due 12/1/14 1,773,356
1,840,000 AAA 5.200% due 12/1/15 1,879,100
2,000,000 AAA 5.200% due 12/1/16 2,037,500
2,155,000 AAA 5.250% due 12/1/18 2,187,325
2,570,000 AAA Bexar County, TX Health Facilities Development Corp. Revenue,
Baptist Health System, Series A, MBIA-Insured,
5.250% due 11/15/27 2,592,487
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
24 1998 Semi-Annual Report to Shareholders
<PAGE>
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Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Texas -- 19.7% (continued)
$ 4,250,000 AAA Brazos County, TX Health Facility, Series B, MBIA-Insured,
5.375% due 1/1/28 $ 4,340,312
1,000,000 BBB Brazos River Authority, PCR, Utilities Electric Co.,
Series C, 5.550% due 6/1/30(c) 1,007,500
Brazos River Authority Revenue, Houston Industries Inc. Project:
28,150,000 AAA Series C, AMBAC-Insured, 5.125% due 5/1/19 28,290,750
10,000,000 AAA Series D, MBIA-Insured, 4.900% due 10/1/15 10,050,000
Brownsville, TX GO, FGIC-Insured:
250,000 AAA 5.100% due 2/15/12 256,875
540,000 AAA 5.150% due 2/15/13 554,850
690,000 AAA 5.200% due 2/15/15 707,250
650,000 AAA 5.000% due 2/15/18 648,375
6,750,000 AAA Brownsville, TX Utilities Systems Revenue, AMBAC-Insured,
5.250% due 9/1/20 6,842,812
4,075,000 AAA Burkburnett, TX ISD, GO, PSFG, 5.000% due 2/15/18 4,064,813
Burleson, TX ISD, PSFG:
4,795,000 Aaa* 6.750% due 8/1/24 5,424,344
11,740,000 NR Pre-Refunded--Escrowed with U.S. government securities to
8/1/06 Call @ 100, 6.750% due 8/1/24(d) 13,691,775
1,570,000 AAA Carrollton, TX ISD, GO, PSFG, 5.000% due 2/15/19 1,564,112
Conroe, TX ISD, PSFG:
3,000,000 AAA Series A, 5.600% due 2/15/21 3,146,250
Series B:
1,000,000 AAA 5.450% due 2/15/15 1,046,250
1,075,000 AAA 5.450% due 2/15/16 1,118,000
Copperas Cove Island, TX ISD, PSFG Refunding:
1,960,000 AAA 5.600% due 2/1/13 2,065,350
2,035,000 AAA 5.600% due 2/1/14 2,136,750
Cypress-Fairbanks, TX ISD, GO, PSFG:
4,055,000 AAA 5.000% due 2/15/16 4,080,344
4,390,000 AAA 5.000% due 2/15/18 4,379,025
Del Valle, TX ISD, GO, PSFG:
2,875,000 AAA 5.100% due 2/1/13 2,939,687
3,025,000 AAA 5.125% due 2/1/14 3,085,500
3,185,000 AAA 5.150% due 2/1/15 3,244,719
7,000,000 AAA 5.000% due 2/1/18 6,982,500
5,850,000 AAA Edinburg, TX ISD, Public Facilities Corp., Lease Revenue,
AMBAC-Insured, 5.000% due 8/15/19 5,864,625
3,000,000 AAA Elgin, TX ISD, GO, PSFG, 5.200% due 10/1/18 3,041,250
El Paso County, TX Community College District Revenue,
AMBAC-Insured, Series B:
1,720,000 AAA 5.125% due 4/1/12 1,767,300
1,000,000 AAA 5.125% due 4/1/15 1,017,500
1,545,000 AAA 5.125% due 4/1/19 1,562,381
El Paso County, TX GO, FGIC-Insured:
1,485,000 AAA 5.000% due 2/15/14 1,503,562
2,355,000 AAA 5.000% due 2/15/18 2,349,112
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 25
<PAGE>
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Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Texas -- 19.7% (continued)
$ 1,215,000 AAA Fort Bend County, TX Levee Improvement District No. 011,
MBIA-Insured, 5.875% due 3/1/13 $ 1,303,087
Fort Worth, TX Higher Education Finance Corp., Higher Education
Revenue, (Texas Christian University Project):
2,690,000 AA- 4.875% due 3/15/12 2,703,450
2,825,000 AA- 4.875% due 3/15/13 2,828,531
3,000,000 AA- 5.000% due 3/15/17 2,996,250
2,000,000 AA- 5.000% due 3/15/20 1,972,500
2,800,000 AA Fort Worth, TX Water & Sewer Revenue, Refunding & Improvement,
5.000% due 2/15/18 2,803,500
400,000 VMIG 1* Guadalupe-Blanco River Authority, PCR, Central Power &
Lighting Co. Project, 3.300% due 11/1/15(b) 400,000
Gulf Coast Waste Disposal Authority, (Amoco Oil Co. Project):
1,000,000 VMIG 1* Environmental Facilities Revenue, 3.450% due 1/1/26(b)(c) 1,000,000
1,400,000 VMIG 1* PCR, 3.200% due 10/1/17(b) 1,400,000
3,300,000 VMIG 1* Gulf Coast Waste Disposal Authority, PCR, (Exxon Project),
3.300% due 6/1/20(b) 3,300,000
Gulf Coast Water Authority, Water Systems Contract Revenue,
South Project, Series A, FSA-Insured:
1,055,000 AAA 5.000% due 8/15/16 1,056,319
2,085,000 AAA 5.000% due 8/15/17 2,074,575
2,135,000 AAA 5.000% due 8/15/18 2,124,325
1,600,000 AAA 5.000% due 8/15/22 1,580,000
Harris County, TX Industrial Development Corp.:
1,700,000 A-1+ Exxon Project, PCR, 3.300% due 8/15/27(b)(c) 1,700,000
1,000,000 Aa3* IDR, Cargill Inc., 7.000% due 10/1/15 1,108,750
6,500,000 A-1+ PCR, 3.250% due 3/1/24(b) 6,500,000
5,000,000 A-1+ Shell Oil Co. Project, 3.350% due 4/1/27(b) 5,000,000
Harris County, TX Toll Road Revenue:
5,800,000 AA 5.100% due 8/15/15 5,872,500
12,155,000 AA 5.125% due 8/15/17 12,230,969
28,670,000 AA 5.000% due 8/15/21 28,275,787
23,820,000 AAA FGIC-Insured, 5.375% due 8/15/20 24,355,950
14,200,000 AAA MBIA-Insured, 5.125% due 8/15/17 14,413,000
8,520,000 AAA Houston, TX Airport System Revenue, FGIC-Insured,
5.125% due 7/1/22 8,594,550
Houston, TX Community College System Revenue:
MBIA-Insured:
1,705,000 AAA 5.600% due 4/15/14 1,809,431
3,295,000 AAA 5.650% due 4/15/15 3,496,819
Student Fee, AMBAC-Insured:
1,315,000 AAA 5.000% due 4/15/15 1,326,506
1,380,000 AAA 5.000% due 4/15/16 1,388,625
1,450,000 AAA 5.000% due 4/15/17 1,459,063
1,520,000 AAA 5.000% due 4/15/18 1,523,800
Houston, TX GO, Series A:
7,445,000 AA- 5.000% due 3/1/13 7,584,594
3,000,000 AA- 5.000% due 3/1/16 3,011,250
5,485,000 AA- 5.000% due 3/1/17 5,491,856
5,760,000 AA- 5.000% due 3/1/18 5,745,600
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
26 1998 Semi-Annual Report to Shareholders
<PAGE>
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================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Texas -- 19.7% (continued)
Houston, TX Water & Sewer Revenue, FGIC-Insured:
Series A:
$ 6,095,000 AAA 5.250% due 12/1/21 $ 6,194,044
25,195,000 AAA 5.250% due 12/1/22 25,635,912
29,000,000 AAA 5.250% due 12/1/25 29,398,750
13,895,000 AAA Series C, 5.250% due 12/1/22 14,120,794
9,615,000 AAA Series D, 5.000% due 1/1/18 9,639,037
Kilgore, TX ISD, GO, PSFG:
525,000 Aaa* 5.400% due 2/15/14 545,344
400,000 Aaa* 5.375% due 2/15/15 414,000
Killeen, TX ISD, GO, PSFG:
1,275,000 AAA 5.000% due 2/15/16 1,282,969
7,500,000 AAA 5.000% due 2/15/18 7,481,250
La Porte, TX ISD, GO, PSFG:
500,000 AAA 5.500% due 2/15/14 528,750
500,000 AAA 5.500% due 2/15/15 527,500
500,000 AAA 5.500% due 2/15/16 523,750
880,000 AAA 5.250% due 2/15/19 894,300
1,600,000 AAA Lockhart, TX ISD, GO, PSFG, 5.000% due 8/1/22 1,592,000
1,700,000 VMIG 1* Lubbock, TX Health Facilities Development Corp. Revenue,
St. Joseph Health Systems, 3.250% due 7/1/13(b) 1,700,000
Manor, TX ISD, GO, PSFG:
1,185,000 AAA 5.100% due 8/1/14 1,207,219
1,235,000 AAA 5.100% due 8/1/15 1,255,069
1,000,000 AAA 5.000% due 8/1/17 1,003,750
5,500,000 AAA Midland County, TX Hospital District Revenue, AMBAC-Insured,
5.375% due 6/1/16 5,637,500
2,000,000 AAA Montgomery County, TX COP, Series A, MBIA-Insured,
5.000% due 3/1/18 1,995,000
9,820,000 AAA North Central Texas Health Development Corp. Revenue,
(Zale Lipshy University Project), FSA-Insured,
5.450% due 4/1/15 10,261,900
North Forest, TX ISD, GO, PSFG:
1,935,000 AAA 5.125% due 8/15/14 1,978,538
1,035,000 AAA 5.000% due 8/15/15 1,045,350
1,385,000 AAA 5.000% due 8/15/16 1,395,388
1,000,000 AAA 5.000% due 8/15/18 997,500
3,630,000 AAA Nueces River Water Supply Facilities, (Corpus Christi Lake
Project),FSA-Insured, 5.500% due 3/1/27 3,797,888
Plano, TX GO:
1,680,000 AAA 5.100% due 9/1/14 1,724,100
1,595,000 AAA 5.150% due 9/1/16 1,626,900
1,025,000 AAA Port Arthur, TX GO, MBIA-Insured, 5.500% due 2/15/16 1,060,875
Port of Port Arthur Navigational District, AMBAC-Insured:
3,290,000 AAA 4.875% due 3/1/17 3,265,325
2,460,000 AAA 4.875% due 3/1/19 2,410,800
Richardson, TX GO:
680,000 AA 5.000% due 2/15/16 680,850
1,465,000 AA 5.000% due 2/15/18 1,450,350
1,500,000 VMIG 1* Sabine River Authority, PCR, Texas Utilities Electric Co., Series A,
AMBAC-Insured 3.300% due 3/1/26(b) 1,500,000
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 27
<PAGE>
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<TABLE>
<CAPTION>
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FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Texas -- 19.7% (continued)
Santa Fe, TX ISD, GO, PSFG:
$ 1,190,000 AAA 5.250% due 2/15/17 $ 1,218,263
2,270,000 AAA 5.125% due 2/15/19 2,287,025
Socorro, TX ISD, PSFG:
3,595,000 AAA 5.300% due 8/15/18 3,671,394
7,460,000 Aaa* 5.125% due 2/15/27 7,497,300
1,610,000 AAA Springtown, TX ISD, GO, PSFG, 5.000% due 2/15/14 1,630,125
Stephenville, TX ISD, GO, PSFG:
1,125,000 AAA 5.000% due 2/15/14 1,137,656
1,570,000 AAA 5.000% due 2/15/15 1,583,738
1,735,000 AAA 5.000% due 2/15/17 1,741,506
1,000,000 AAA Texas State Department of Housing & Community Affairs,
Multi-Family Revenue,Volente Project, FNMA Collateralized,
5.550% due 1/1/18(c) 1,021,250
5,000,000 AA Texas State Public Financing Authority, GO, 5.000% due 10/1/15 5,025,000
Texas State Public Finance Authority, Building Revenue,
AMBAC-Insured:
2,650,000 AAA 5.000% due 8/1/13 2,693,063
2,800,000 AAA 5.000% due 8/1/14 2,835,000
2,960,000 AAA 5.000% due 8/1/15 2,985,900
General Services Common Projects, Series A:
5,450,000 AAA 5.000% due 2/1/17 5,490,875
5,730,000 AAA 5.000% due 2/1/18 5,744,325
32,300,000 AAA Texas State Turnpike Authority Revenue, George Bush Turnpike,
FGIC-Insured, 5.250% due 1/1/23(a) 32,784,500
Texas State Water Development Board Revenue,
State Revolving Fund, Series B:
3,000,000 AAA 5.000% due 7/15/14 3,052,500
2,500,000 AAA 5.000% due 7/15/15 2,534,375
7,000,000 AAA 5.000% due 7/15/16 7,078,750
200,000 AAA 5.000% due 7/15/17 201,750
67,640,000 AAA 5.000% due 7/15/19(g) 67,978,200
Texas State Water Development, GO, Series D:
10,000,000 AA 5.000% due 8/1/16 10,037,500
6,000,000 AA 5.000% due 8/1/19 5,970,000
4,120,000 AA+ Travis County, TX Health Facilities Development Corp.,
Hospital Revenue, Charity Obligation Group, Series A,
5.125% due 11/1/18 4,135,450
Tyler, TX Health Facilities Development Corp., (East Texas Medical
Center Project):
1,350,000 AAA Series A, MBIA-Insured, 5.500% due 11/1/17 1,419,188
2,000,000 AAA Series B, FSA-Insured, 5.500% due 11/1/17 2,102,500
3,250,000 AAA Series C, FSA-Insured, 5.500% due 11/1/17 3,416,563
Upper Trinity Regional Water District, Water Revenue,
Treated Water Supply Systems, MBIA-Insured:
1,735,000 AAA 5.000% due 8/1/13 1,750,181
6,180,000 AAA 5.000% due 8/1/18 6,133,650
4,450,000 AAA 5.000% due 8/1/21 4,394,375
Victoria, TX ISD, GO, PSFG:
1,245,000 AAA 5.000% due 2/15/15 1,257,450
1,370,000 AAA 5.000% due 2/15/16 1,378,563
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
28 1998 Semi-Annual Report to Shareholders
<PAGE>
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Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Texas -- 19.7% (continued)
$ 2,500,000 AAA Victoria, TX Utility Systems Revenue, Series A, MBIA-Insured,
5.000% due 12/1/21 $ 2,500,000
Weatherford, TX ISD, GO, PSFG:
3,295,000 Aaa* 5.000% due 2/15/13 3,344,425
3,000,000 Aaa* 5.000% due 2/15/15 3,026,250
- ------------------------------------------------------------------------------------------------------------------------------------
749,099,332
- ------------------------------------------------------------------------------------------------------------------------------------
Utah -- 2.6%
Intermountain Power Agency, Utah Power Supply Revenue:
9,125,000 AAA Series A, MBIA-Insured, 5.250% due 7/1/15 9,318,906
88,295,000 A+ Series D, 5.000% due 7/1/21(a) 87,301,681
3,250,000 AAA Utah Water Finance Agency Revenue, Timpanogos Lien
Financing Project, Series B, MBIA-Insured, 5.000% due 6/1/19 3,237,813
- ------------------------------------------------------------------------------------------------------------------------------------
99,858,400
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia -- 2.0%
Arlington County, VA IDA, Multi-Family Housing Revenue:
705,000 A 6.300% due 7/1/16 764,044
750,000 A 6.350% due 7/1/20 811,875
1,000,000 A 6.375% due 7/1/25 1,083,750
Blue Ridge Regional Jail Authority, Regional Jail Facility Revenue,
MBIA-Insured:
1,600,000 AAA 5.000% due 12/1/11 1,662,000
750,000 AAA 5.000% due 12/1/12 773,437
1,200,000 AAA 5.000% due 12/1/13 1,221,000
1,750,000 AAA 5.200% due 12/1/17 1,791,562
1,000,000 AAA 5.200% due 12/1/21 1,018,750
1,500,000 AAA Chesapeake Bay Bridge & Tunnel Commission District Revenue,
General Resolution, MBIA-Insured, 5.250% due 7/1/19 1,530,000
Harrisonburg, VA Redevelopment & Housing Authority, Multi-Family
Housing Revenue, (Battery Heights Project), Series A,
GNMA-Collateralized:
1,425,000 AAA 6.100% due 4/20/16 1,544,344
2,715,000 AAA 6.150% due 4/20/26 2,942,381
500,000 AAA Lynchburg, VA Redevelopment & Housing Authority Revenue, Waldon
Pond, Series A, GNMA-Collateralized, 6.200% due 7/20/27 542,500
3,000,000 AAA Medical College, Virginia Hospitals Authority Revenue, MBIA-Insured,
5.125% due 7/1/18 3,026,250
2,160,000 AA Norfolk, VA Redevelopment & Housing Authority, Educational Facilities
Revenue, Tidewater Community College Campus,
5.875% due 11/1/15 2,327,400
Northern Virginia Transit District Commuter Rail Revenue, (Virginia
Railway Express Project):
1,605,000 AAA FSA-Insured, 5.375% due 7/1/14 1,681,238
MBIA-Insured:
1,245,000 AAA 5.150% due 7/1/12 1,287,019
1,000,000 AAA 5.200% due 7/1/13 1,033,750
14,035,000 AAA Riverside, VA Regulatory Jail Authority Facility Revenue,
MBIA-Insured, 5.875% due 7/1/14 15,210,431
2,130,000 AAA Roanoke, VA Redevelopment & Housing Authority Revenue,
Series A, Westwind III, GNMA-Collateralized,
6.200% due 7/20/26 2,276,438
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 29
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
Virginia -- 2.0% (continued)
Virginia State Housing Development Authority, Commonwealth
Mortgage Revenue:
$ 6,665,000 AA+ Series C, Subseries C-1, Remarketed 6/10/98,
5.100% due 7/1/14 $ 6,689,994
1,225,000 AAA Series D-2, MBIA-Insured, 5.650% due 1/1/13 1,310,750
Series D-4:
1,330,000 AA+ 6.100% due 1/1/11 1,433,075
1,365,000 AA+ 6.100% due 7/1/11 1,470,788
1,400,000 AA+ 6.125% due 1/1/12 1,510,250
1,440,000 AA+ 6.125% due 7/1/12 1,553,400
1,485,000 AA+ 6.150% due 1/1/13 1,600,088
1,525,000 AA+ 6.150% due 7/1/13 1,643,188
1,565,000 AA+ 6.200% due 1/1/14 1,684,331
1,615,000 AA+ 6.200% due 7/1/14 1,738,144
4,380,000 AA+ Series E, Subseries E-2, 5.250% due 7/1/17 4,434,750
5,895,000 AA+ Virginia State Public School Authority, School Financing, Series I,
5.125% due 8/1/16 5,998,163
1,000,000 AAA Winchester, VA IDA, Educational Facilities Revenue, 1st Mortgage,
Shenandoah University Project, MBIA-Insured,
5.000% due 10/1/18 1,001,250
- ------------------------------------------------------------------------------------------------------------------------------------
74,596,340
- ------------------------------------------------------------------------------------------------------------------------------------
Virgin Islands -- 0.4%
Virgin Islands Public Finance Authority Revenue,
Senior Lien, Series A:
5,580,000 BBB- 5.300% due 10/1/11 5,691,600
5,380,000 BBB- 5.400% due 10/1/12 5,521,225
4,245,000 BBB- 5.500% due 10/1/13 4,367,044
- ------------------------------------------------------------------------------------------------------------------------------------
15,579,869
- ------------------------------------------------------------------------------------------------------------------------------------
Washington -- 2.3%
Port Seattle, WA Revenue, Series A, FGIC-Insured:
4,000,000 AAA 5.375% due 6/1/13 4,200,000
3,985,000 AAA 5.125% due 6/1/14 4,084,625
Snohomish County, WA School District Number 015 Edmonds,
FGIC-Insured:
5,000,000 AAA 5.250% due 12/1/15 5,125,000
7,500,000 AAA 5.300% due 12/1/16 7,696,875
2,530,000 Aaa* Thurston County, WA GO, MBIA-Insured, 5.000% due 8/1/15 2,542,650
4,000,000 Aaa* Washington State Housing Finance Commission, Single
Family Program, Series 3N, FNMA-GNMA-FHLMC-Collateralized,
5.250% due 12/1/17 4,050,000
Washington State Public Power Supply Project Revenue, Series B:
24,000,000 Aa1* 5.500% due 7/1/17(h) 24,090,000
29,220,000 Aa1* 5.500% due 7/1/18(a) 29,329,575
6,420,000 AAA Washington State Public Power Supply System, Nuclear
Project No. 2, Series A, FSA-Insured, 5.125% due 7/1/11 6,684,825
- ------------------------------------------------------------------------------------------------------------------------------------
87,803,550
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
30 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Schedule of Investments (unaudited) (continued) August 31, 1998
================================================================================
<TABLE>
<CAPTION>
====================================================================================================================================
FACE
AMOUNT RATING SECURITY VALUE
====================================================================================================================================
<S> <C> <C> <C>
West Virginia -- 0.7%
Marion County, WV County Commissioner, Solid Waste Disposal
Facilities Revenue, Adirondak Recycling, Series A:
$ 18,587,429 NR 8.000% due 12/1/25(a) $ 18,587,429
2,614,755 NR 10.000% due 12/1/25 2,614,755
Ohio County, WV Board of Education, GO:
2,000,000 A+ 5.000% due 6/1/13 2,040,000
500,000 A+ 5.125% due 6/1/18 504,375
West Virginia University Revenues, (West Virginia University Project),
Student Union, Series B, AMBAC-Insured:
1,755,000 AAA 5.000% due 5/1/17 1,761,581
1,915,000 AAA 5.000% due 5/1/18 1,917,394
- ------------------------------------------------------------------------------------------------------------------------------------
27,425,534
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin -- 1.0%
1,225,000 AAA Merrill, WI Area Commercial Public School District, FSA-Insured,
5.000% due 4/1/18 1,223,469
1,325,000 Aaa* Winneconne, WI Community School District, GO, FGIC-Insured,
6.750% due 4/1/16 1,537,000
2,000,000 AA Wisconsin Housing & EDA, Home Ownership Revenue, Series A,
6.450% due 3/1/17 2,150,000
33,000,000 AAA Wisconsin State Health & Educational Facilities Authority,
Aurora Health Care, MBIA-Insured, 5.250% due 8/15/17 33,495,000
- ------------------------------------------------------------------------------------------------------------------------------------
38,405,469
- ------------------------------------------------------------------------------------------------------------------------------------
Wyoming -- 0.4%
Unita County, WY PCR, (Chevron USA Inc. Project):
700,000 P-1* 3.250% due 8/15/20(b) 700,000
1,850,000 VMIG 1* 3.250% due 12/1/22(b) 1,850,000
Wyoming Building Corp. Revenue, AMBAC-Insured:
2,820,000 AAA 5.000% due 10/1/13 2,858,775
11,055,000 AAA 5.000% due 10/1/18 11,013,544
- ------------------------------------------------------------------------------------------------------------------------------------
16,422,319
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS -- 100%
(Cost-- $3,639,151,668**) $3,812,035,708
====================================================================================================================================
</TABLE>
(a) Security segregated by Custodian for open purchase commitments.
(b) Variable rate obligation payable at par on demand at any time on no more
than seven days notice.
(c) Income from this issue is considered a preference item for purposes of
calculating the alternative minimum tax.
(d) Pre-Refunded bonds escrowed with U.S. government securities and bonds
escrowed to maturity with U.S. government securities are considered by the
manager to be triple-A rated even if issuer has not applied for new
ratings.
(e) Security is exempt from registration under Rule 144A of the Securities Act
of 1933. This security may be resold in transactions that are exempt from
registration, generally to qualified institutional buyers.
(f) Security in default.
(g) Security partially segregated by Custodian for open purchase commitments.
(h) Security serves as collateral for futures contracts.
** Aggregate cost for Federal income tax purposes is substantially the same.
See pages 32 and 33 for definitions of ratings and certain security
descriptions.
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 31
<PAGE>
================================================================================
Bond Ratings (unaudited)
================================================================================
All ratings are by Standard & Poor's Ratings Service ("Standard & Poor's"),
except those identified by an asterisk (*) are rated by Moody's Investors
Service Inc. ("Moody's"). The definitions of the applicable rating symbols are
set forth below:
Standard & Poor's -- Rating from "AA" to "B" may be modified by the addition of
a plus (+) or minus (-) sign to show relative standings within the major rating
categories.
AAA -- Bonds rated "AAA" have the highest rating assigned by Standard &
Poor's. Capacity to pay interest and repay principal is extremely
strong.
AA -- Bonds rated "AA" have a very strong capacity to pay interest and
repay principal and differs from the highest rated issue only in
a small degree.
A -- Bonds rated "A" have a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than
debt in higher rated categories.
BBB -- Bonds rated "BBB" are regarded as having an adequate capacity to
pay interest and repay principal. Whereas they normally exhibit
adequate protection parameters, adverse economic conditions or
changing circumstances are more likely to lead to a weakened
capacity to pay interest and repay principal for bonds in this
category than in higher rated categories.
BB -- Bonds rated "BB" have less near-term vulnerability to default
than other speculative issues. However, it faces major ongoing
uncertainties or exposure to adverse business, financial, or
economic conditions which could lead to inadequate capacity to
meet timely interest and principal payments. The "BB" rating
category is also used for debt subordinated to senior debt that
is assigned an actual or implied "BBB-" rating.
B -- Bonds rated "B" have a greater vulnerability to default but
currently have the capacity to meet interest payments and
principal payments. Adverse business, financial, or economic
conditions will likely impair capacity or willingness to pay
interest and repay principal. The "B" category is also used for
debt subordinated to senior debt that is assigned an actual or
implied "BB" or "BB-" rating.
Moody's -- Numerical modifiers 1, 2 and 3 may be applied to each generic rating
from "Aa" to "B," where 1 is the highest and 3 the lowest ranking within its
generic category.
Aaa -- Bonds rated "Aaa" are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally
referred to as "gilt edge." Interest payments are protected by a
large or by an exceptionally stable margin and principal is
secure. While the various protective elements are likely to
change, such changes as can be visualized are most unlikely to
impair the fundamentally strong position of such issues.
Aa -- Bonds that are rated "Aa" are judged to be of high quality by all
standards. Together with the "Aaa" group they comprise what are
generally known as high grade bonds. They are rated lower than
the best bonds because margins of protection may not be as large
in "Aaa" securities or fluctuation of protective elements may be
of greater amplitude or there may be other elements present which
make the long-term risks appear somewhat larger than in "Aaa"
securities.
A -- Bonds rated "A" possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors
giving security to principal and interest are considered adequate
but elements may be present which suggest a susceptibility to
impairment some time in the future.
Baa -- Bonds rated "Baa" are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the
present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time. Such
bonds lack outstanding investment characteristics and in fact
have speculative characteristics as well.
Ba -- Bonds rated "Ba" are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection
of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad time over
the future. Uncertainty of position characterizes bonds in this
class.
B -- Bonds rated "B" generally lack characteristics of desirable
investments. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period
of time may be small.
NR -- Indicates that the bond is not rated by Standard & Poor's or
Moody's.
- --------------------------------------------------------------------------------
32 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Short-Term Security Ratings (unaudited)
================================================================================
SP-1 -- Standard & Poor's highest rating indicating very strong or strong
capacity to pay principal and interest; those issues determined
to possess overwhelming safety characteristics are denoted with a
plus (+) sign.
A-1 -- Standard & Poor's highest commercial paper and variable-rate
demand obligation (VRDO) rating indicating that the degree of
safety regarding timely payment is either overwhelming or very
strong; those issues determined to possess overwhelming safety
characteristics are denoted with a plus (+) sign.
VMIG 1 -- Moody's highest rating for issues having a demand feature --
VRDO.
P-1 -- Moody's highest rating for commercial paper and for VRDO prior to
the advent of the VMIG 1 rating.
================================================================================
Security Descriptions (unaudited)
================================================================================
ABAG -- Association of Bay Area Governments
AIG -- American International Guaranty
AMBAC -- AMBAC Indemnity Corporation
BAN -- Bond Anticipation Notes
BIG -- Bond Investors Guaranty
CGIC -- Capital Guaranty Insurance Company
CHFCLI -- California Health Facility Construction Loan
Insurance
COP -- Certificate of Participation
EDA -- Economic Development Authority
ETM -- Escrowed To Maturity
FAIRS -- Floating Adjustable Interest Rate Securities
FGIC -- Financial Guaranty Insurance Company
FHA -- Federal Housing Administration
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
FRTC -- Floating Rate Trust Certificates
FSA -- Federal Savings Association
GIC -- Guaranteed Investment Contract
GNMA -- Government National Mortgage
Association
GO -- General Obligation
HDC -- Housing Development Corporation
HFA -- Housing Finance Authority
IDA -- Industrial Development Authority
IDB -- Industrial Development Board
IDR -- Industrial Development Revenue
INFLOS -- Inverse Floaters
ISD -- Independent School District
LOC -- Letter of Credit
MBIA -- Municipal Bond Investors Assurance
Corporation
MVRICS -- Municipal Variable Rate Inverse Coupon
Security
PCR -- Pollution Control Revenue
PSFG -- Permanent School Fund Guaranty
RAN -- Revenue Anticipation Notes
RIBS -- Residual Interest Bonds
RITES -- Residual Interest Tax-Exempt Security
SYCC -- Structured Yield Curve Certificate
TAN -- Tax Anticipation Notes
TECP -- Tax Exempt Commercial Paper
TOB -- Tender Option Bonds
TRAN -- Tax and Revenue Anticipation Notes
VAN -- Veterans Administration
VRDD -- Variable Rate Daily Demand
VRWE -- Variable Rate Wednesday Demand
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 33
<PAGE>
<TABLE>
<CAPTION>
=====================================================================================================
Statement of Assets and Liabilities (unaudited) August 31, 1998
=====================================================================================================
<S> <C>
ASSETS:
Investments, at value (Cost -- $3,639,151,668) $3,812,035,708
Interest receivable 49,357,191
Receivable for securities sold 22,232,644
Receivable for Fund shares sold 4,982,343
- -----------------------------------------------------------------------------------------------------
Total Assets 3,888,607,886
- -----------------------------------------------------------------------------------------------------
LIABILITIES:
Payable for securities purchased 65,020,985
Payable to broker-variation margin 1,781,250
Investment advisory fees payable 1,391,530
Distribution fees payable 207,889
Payable to bank 175,990
Administration fees payable 175,360
Payable for Fund shares sold 22,078
Accrued expenses 278,653
- -----------------------------------------------------------------------------------------------------
Total Liabilities 69,053,735
- -----------------------------------------------------------------------------------------------------
Total Net Assets $3,819,554,151
=====================================================================================================
NET ASSETS:
Par value of capital shares $ 2,355,673
Capital paid in excess of par value 3,638,595,808
Overdistributed net investment income (11,958,457)
Accumulated net realized gain from security transactions and futures contracts 31,680,987
Net unrealized appreciation of investments and futures contracts 158,880,140
- -----------------------------------------------------------------------------------------------------
Total Net Assets $3,819,554,151
=====================================================================================================
Shares Outstanding:
Class A 151,654,965
------------------------------------------------------------------------------------------------
Class B 72,418,413
------------------------------------------------------------------------------------------------
Class L 9,991,381
------------------------------------------------------------------------------------------------
Class Y 1,502,532
------------------------------------------------------------------------------------------------
Net Asset Value:
Class A (and redemption price) $16.22
------------------------------------------------------------------------------------------------
Class B * $16.21
------------------------------------------------------------------------------------------------
Class L ** $16.20
------------------------------------------------------------------------------------------------
Class Y (and redemption price) $16.21
------------------------------------------------------------------------------------------------
Maximum Public Offering Price Per Share:
Class A (net asset value plus 4.17% of net asset value per share) $16.90
------------------------------------------------------------------------------------------------
Class L (net asset value plus 1.01% of net asset value per share) $16.36
=====================================================================================================
</TABLE>
* Redemption price is NAV of Class B shares reduced by a 4.50% CDSC if shares
are redeemed within one year from purchase (See Note 3).
** Redemption price is NAV of Class L shares reduced by a 1.00% CDSC if shares
are redeemed within the first year of purchase (See Note 3).
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
34 1998 Semi-Annual Report to Shareholders
<PAGE>
<TABLE>
<CAPTION>
================================================================================
Statement of Operations (unaudited) For the Six Months Ended August 31, 1998
================================================================================
<S> <C>
INVESTMENT INCOME:
Interest $ 100,025,354
- ------------------------------------------------------------------------------
EXPENSES:
Distribution fees (Note 3) 6,102,279
Investment advisory fees (Note 3) 5,755,280
Administration fees (Note 3) 3,210,284
Shareholder and system servicing fees 500,719
Registration fees 162,191
Shareholder communications 89,153
Custody 79,155
Audit and legal 46,122
Pricing service fees 32,945
Directors' fees 29,397
Other 25,848
- ------------------------------------------------------------------------------
Total Expenses 16,033,373
- ------------------------------------------------------------------------------
Net Investment Income 83,991,981
- ------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
AND FUTURES CONTRACTS (NOTES 4 AND 5):
Realized Gain (Loss) From:
Security transactions (excluding short-term securities) 18,138,943
Futures contracts (12,274,406)
- ------------------------------------------------------------------------------
Net Realized Gain 5,864,537
- ------------------------------------------------------------------------------
Change in Net Unrealized Appreciation of Investments
and Futures Contracts:
Beginning of period 152,317,639
End of period 158,880,140
- ------------------------------------------------------------------------------
Increase in Net Unrealized Appreciation 6,562,501
- ------------------------------------------------------------------------------
Net Gain on Investments and Futures Contracts 12,427,038
- ------------------------------------------------------------------------------
Increase in Net Assets From Operations $ 96,419,019
==============================================================================
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 35
<PAGE>
<TABLE>
<CAPTION>
===================================================================================================
Statements of Changes in Net Assets
===================================================================================================
For the Six Months Ended August 31, 1998 (unaudited)
and the Year Ended February 28, 1998
August 31, February 28,
===================================================================================================
<S> <C> <C>
OPERATIONS:
Net investment income $ 83,991,981 $ 157,886,553
Net realized gain 5,864,537 94,713,402
Increase in net unrealized appreciation 6,562,501 127,793,799
- ---------------------------------------------------------------------------------------------------
Increase in Net Assets From Operations 96,419,019 380,393,754
- ---------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM (NOTE 2):
Net investment income (90,104,187) (158,287,063)
Net realized gains -- (100,590,928)
- ---------------------------------------------------------------------------------------------------
Decrease in Net Assets From Distributions to Shareholders (90,104,187) (258,877,991)
- ---------------------------------------------------------------------------------------------------
FUND SHARE TRANSACTIONS (NOTE 6):
Net proceeds from sale of shares 368,011,796 791,732,693
Net asset value of shares issued for
reinvestment of dividends 53,825,310 166,707,545
Cost of shares reacquired (239,300,263) (432,770,227)
- ---------------------------------------------------------------------------------------------------
Increase in Net Assets From Fund Share Transactions 182,536,843 525,670,011
- ---------------------------------------------------------------------------------------------------
Increase in Net Assets 188,851,675 647,185,774
NET ASSETS:
Beginning of period 3,630,702,476 2,983,516,702
- ---------------------------------------------------------------------------------------------------
End of period* $3,819,554,151 $3,630,702,476
===================================================================================================
* Includes overdistributed net investment income of: $(11,958,457) $5,846,251)
===================================================================================================
</TABLE>
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
36 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Notes to Financial Statements (unaudited)
================================================================================
1. Significant Accounting Policies
Smith Barney Managed Municipals Fund Inc. ("Fund"), a Maryland corporation, is
registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company.
The significant accounting policies consistently followed by the Fund are: (a)
security transactions are accounted for on trade date; (b) securities are valued
at the mean between bid and asked prices provided by an independent pricing
service that are based on transactions in municipal obligations, quotations from
municipal bond dealers, market transactions in comparable securities and various
relationships between securities; (c) securities maturing within 60 days are
valued at cost plus accreted discount, or minus amortized premium, which
approximates value; (d) gains or losses on the sale of securities are calculated
by using the specific identification method; (e) interest income, adjusted for
amortization of premium and accretion of original issue discount, is recorded on
an accrual basis; market discount is recognized upon the disposition of the
security; (f) dividends and distributions to shareholders are recorded on the
ex-dividend date; (g) direct expenses are charged to each class; investment
advisory fees and general Fund expenses are allocated on the basis of relative
net assets of each class; (h) the character of income and gains to be
distributed are determined in accordance with income tax regulations which may
differ from generally accepted accounting principles. At February 28, 1998,
reclassifications were made to the Fund's capital accounts to reflect permanent
book/tax differences and income and gains available for distributions under
income tax regulations. Net investment income, net realized gains and net assets
were not affected by this adjustment; (i) the Fund intends to comply with the
applicable provisions of the Internal Revenue Code of 1986, as amended,
pertaining to regulated investment companies and to make distributions of
taxable income sufficient to relieve it from substantially all Federal income
and excise taxes; and (j) estimates and assumptions are required to be made
regarding assets, liabilities and changes in net assets resulting from
operations when financial statements are prepared. Changes in the economic
environment, financial markets and other parameters used in determining these
estimates could cause actual results to differ.
2. Exempt-Interest Dividends and Other Distributions
The Fund intends to satisfy requirements that allow interest from municipal
securities, which is exempt from regular Federal income tax and from certain
states' income taxes, to retain its exempt-interest status when distributed to
the shareholders of the Fund.
Capital gain distributions, if any, are taxable to shareholders, and are
declared and paid at least annually. If necessary, additional taxable
distributions may be made to avoid a Federal excise tax.
3. Investment Advisory Agreement, Administration Agreement and Other
Transactions
Mutual Management Corp. ("MMC"), a subsidiary of Salomon Smith Barney Holdings
Inc. ("SSBH"), acts as investment adviser to the Fund. The Fund pays MMC an
advisory fee calculated at an annual rate of 0.35% of the average daily net
assets up to $500 million; 0.32% of the average daily net assets of the next
$1.0 billion and 0.29% in excess of $1.5 billion. This fee is calculated daily
and paid monthly.
MMC also acts as the Fund's administrator for which the Fund pays a fee
calculated at an annual rate of 0.20% of the average daily net assets up to $500
million; 0.18% of the average daily net assets of the next $1.0 billion and
0.16% of the average daily net assets in excess of $1.5 billion. This fee is
calculated daily and paid monthly.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 37
<PAGE>
================================================================================
Notes to Financial Statements (unaudited) (continued)
================================================================================
Smith Barney Inc. ("SB"), another subsidiary of SSBH, acts as distributor of
Fund shares.
On June 12, 1998, the Fund's Class C shares were renamed Class L shares.
Effective June 15, 1998, Class L shares are being sold at net asset value plus a
maximum initial sales charge of 1.00%. Class L shares also have a 1.00%
contingent deferred sales charge ("CDSC"), which applies if redemption occurs
within the first year of purchase.
There is also a CDSC of 4.50% on Class B shares, which applies if redemption
occurs within one year from purchase. This CDSC declines by 0.50% the first year
after purchase and thereafter by 1.00% per year until no CDSC is incurred. In
addition, Class A shares also have a 1.00% CDSC, which applies if redemption
occurs within the first year of purchase. This CDSC only applies to those
purchases of Class A shares, which, when combined with current holdings of Class
A shares, equal or exceed $500,000 in the aggregate. These purchases do not
incur an initial sales charge.
For the six months ended August 31, 1998, SB received sales charges of
approximately $2,452,000 and $135,000 on sales of the Fund's Class A and Class L
shares, respectively. In addition, CDSCs paid to SB were approximately:
<TABLE>
<CAPTION>
Class A Class B Class L
================================================================================
<S> <C> <C> <C>
CDSCs $ 32,000 $743,000 $ 12,000
================================================================================
</TABLE>
Pursuant to a Distribution Plan, the Fund pays a service fee with respect to its
Class A, B and L shares, calculated at an annual rate of 0.15% of the average
daily net assets for each respective class. In addition, the Fund pays a
distribution fee with respect to its Class B and L shares calculated at the
annual rate of 0.50% and 0.55%, of the average daily net assets of each class,
respectively.
For the six months ended August 31, 1998, total Distribution Plan fees incurred
were:
<TABLE>
<CAPTION>
Class A Class B Class L
================================================================================
<S> <C> <C> <C>
Distribution Plan Fees $1,826,474 $3,768,431 $ 507,374
================================================================================
</TABLE>
All officers and one Director of the Fund are employees of SB.
4. Investments
During the six months ended August 31, 1998, the aggregate cost of purchases and
proceeds from sales of investments (including maturities, but excluding
short-term securities) were as follows:
<TABLE>
================================================================================
<S> <C>
Purchases $1,166,283,863
- --------------------------------------------------------------------------------
Sales 861,851,273
================================================================================
</TABLE>
At August 31, 1998, the aggregate gross unrealized appreciation and depreciation
of investments for Federal income tax purposes were substantially as follows:
<TABLE>
===============================================================================
<S> <C>
Gross unrealized appreciation $ 231,400,494
Gross unrealized depreciation (58,516,454)
- -------------------------------------------------------------------------------
Net unrealized appreciation $ 172,884,040
===============================================================================
</TABLE>
5. Futures Contracts
Initial margin deposits made upon entering into futures contracts are recognized
as assets. The initial margin is segregated by the custodian and is noted in the
schedule of investments. During the period the futures contract is open, changes
in the value of the contract are recognized as unrealized gains or losses by
"marking to market" on a daily basis to reflect the market value of the contract
at the end of each day's trading. Variation margin payments are made or received
and recognized as assets due from or liabilities due to broker, depending upon
whether unrealized gains or losses are incurred. When the contract is closed,
the Fund records a realized gain or loss equal to the difference between the
proceeds from (or cost of) the closing transactions and the Fund's basis in the
contract.
The Fund enters into such contracts to hedge a portion of its portfolio. The
Fund bears the market risk that arises from changes in the value of the
financial instruments and securities indices (futures contracts).
- --------------------------------------------------------------------------------
38 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Notes to Financial Statements (unaudited) (continued)
================================================================================
At August 31, 1998, the Fund had the following open futures contracts:
<TABLE>
<CAPTION>
Expiration # of Basis Market Unrealized
Month/Year Contracts Value Value Loss
===========================================================================================================================
<S> <C> <C> <C> <C> <C>
Futures contracts to buy:
U.S. Government Long Bond Index 9/98 3,000 $395,378,900 $381,375,000 $(14,003,900)
===========================================================================================================================
</TABLE>
6. Capital Shares
At August 31, 1998, the Fund had one billion shares of capital stock authorized
with a par value of $0.01 per share. The Fund has established multiple classes
of shares. Each share of a class represents an identical interest in the Fund
and has the same rights, except that each class bears certain expenses
specifically related to the distribution of its shares. Effective June 12, 1998,
the Fund adopted the renaming of existing Class C shares as Class L shares.
At August 31, 1998, total paid-in capital amounted to the following for each
class:
<TABLE>
<CAPTION>
Class A Class B Class L Class Y
====================================================================================================================================
<S> <C> <C> <C> <C>
Total Paid-in Capital $2,296,982,216 $1,161,446,364 $158,748,104 $23,774,797
====================================================================================================================================
</TABLE>
Transactions in shares of each class were as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
August 31, 1998 February 28, 1998
-------------------------------- ----------------------------------
Shares Amount Shares Amount
====================================================================================================================================
<S> <C> <C> <C> <C>
Class A
Shares sold 12,845,754 $ 206,893,682 29,486,209 $ 470,065,083
Shares issued on reinvestment 2,214,788 35,648,492 6,901,333 109,832,919
Shares redeemed (9,569,444) (154,123,402) (18,373,814) (293,622,517)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase 5,491,098 $ 88,418,772 18,013,728 $ 286,275,485
====================================================================================================================================
Class B
Shares sold 6,334,593 $ 102,000,338 15,027,839 $ 238,903,620
Shares issued on reinvestment 971,968 15,639,575 3,169,741 50,431,107
Shares redeemed (4,379,884) (70,521,345) (6,725,498) (106,847,239)
- -----------------------------------------------------------------------------------------------------------------------------------
Net Increase 2,926,677 $ 47,118,568 11,472,082 $ 182,487,488
====================================================================================================================================
Class L+
Shares sold 2,899,182 $ 46,649,051 4,455,449 $ 70,921,771
Shares issued on reinvestment 143,970 2,315,773 353,026 5,622,820
Shares redeemed (885,665) (14,250,728) (1,628,656) (25,943,307)
- -----------------------------------------------------------------------------------------------------------------------------------
Net Increase 2,157,487 $ 34,714,096 3,179,819 $ 50,601,284
====================================================================================================================================
Class Y
Shares sold 779,352 $ 12,468,725 732,857 $ 11,842,219
Shares issued on reinvestment 13,750 221,470 51,522 820,699
Shares redeemed (25,116) (404,788) (392,741) (6,357,164)
- -----------------------------------------------------------------------------------------------------------------------------------
Net Increase 767,986 $ 12,285,407 391,638 $ 6,305,754
====================================================================================================================================
</TABLE>
+ On June 12, 1998, Class C shares were renamed Class L shares.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 39
<PAGE>
================================================================================
Financial Highlights
================================================================================
For a share of each class of capital stock outstanding throughout each period:
<TABLE>
<CAPTION>
Class A Shares 1998(1) 1998 1997 1996 1995 1994(2)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $16.19 $15.61 $16.20 $15.47 $16.13 $16.71
- ------------------------------------------------------------------------------------------------------------------------------------
Income From Operations:
Net investment income 0.38 0.79 0.88 0.91 0.95 0.90
Net realized and unrealized gain (loss) 0.05 1.06 (0.18) 0.80 (0.37) 0.30
- ------------------------------------------------------------------------------------------------------------------------------------
Total Income From Operations 0.43 1.85 0.70 1.71 0.58 1.20
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions From:
Net investment income (0.40) (0.79) (0.91) (0.90) (0.95) (0.88)
Net realized gains -- (0.48) (0.38) (0.08) (0.29) (0.90)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.40) (1.27) (1.29) (0.98) (1.24) (1.78)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $16.22 $16.19 $15.61 $16.20 $15.47 $16.13
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return 2.73%++ 12.30% 4.51% 11.34% 4.11% 7.41%
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, End of Period (millions) $2,459 $2,367 $2,000 $1,892 $1,772 $1,847
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to Average Net Assets:
Expenses 0.68%+ 0.68% 0.68% 0.70% 0.71% 0.72%
Net investment income 4.67+ 4.98 5.60 5.47 6.25 5.43
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio Turnover Rate 24% 110% 103% 80% 100% 131%
====================================================================================================================================
</TABLE>
(1) For the six months ended August 31, 1998 (unaudited).
(2) Per share amounts have been calculated using the monthly average shares
method, rather than the undistributed net investment income method, because
it more accurately reflects the per share data for the period.
++ Total return is not annualized, as it may not be representative of the
total return for the year.
+ Annualized.
- --------------------------------------------------------------------------------
40 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Financial Highlights (continued)
================================================================================
For a share of each class of capital stock outstanding throughout each period:
<TABLE>
<CAPTION>
Class B Shares 1998(1) 1998 1997 1996 1995 1994(2)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $16.19 $15.60 $16.20 $15.47 $16.13 $16.71
- ------------------------------------------------------------------------------------------------------------------------------------
Income From Operations:
Net investment income 0.34 0.72 0.79 0.82 0.86 0.81
Net realized and unrealized gain (loss) 0.04 1.06 (0.18) 0.81 (0.37) 0.31
- ------------------------------------------------------------------------------------------------------------------------------------
Total Income From Operations 0.38 1.78 0.61 1.63 0.49 1.12
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions From:
Net investment income (0.36) (0.71) (0.83) (0.82) (0.86) (0.80)
Net realized gains -- (0.48) (0.38) (0.08) (0.29) (0.90)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.36) (1.19) (1.21) (0.90) (1.15) (1.70)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $16.21 $16.19 $15.60 $16.20 $15.47 $16.13
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return 2.41%++ 11.81% 3.92% 10.78% 3.54% 6.86%
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, End of Period (millions) $1,174 $1,125 $905 $730 $515 $350
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to Average Net Assets:
Expenses 1.20%+ 1.20% 1.19% 1.22% 1.23% 1.25%
Net investment income 4.15+ 4.46 5.09 4.94 5.73 4.90
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio Turnover Rate 24% 110% 103% 80% 100% 131%
====================================================================================================================================
</TABLE>
(1) For the six months ended August 31, 1998 (unaudited).
(2) Per share amounts have been calculated using the monthly average shares
method, rather than the undistributed net investment income method, because
it more accurately reflects the per share data for the period.
++ Total return is not annualized, as it may not be representative of the
total return for the year.
+ Annualized.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 41
<PAGE>
================================================================================
Financial Highlights (continued)
================================================================================
For a share of each class of capital stock outstanding throughout each period:
<TABLE>
<CAPTION>
Class L Shares(1) 1998(2) 1998(3) 1997 1996 1995(4)
====================================================================================================================================
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $16.18 $15.60 $16.20 $15.47 $14.30
- ------------------------------------------------------------------------------------------------------------------------------------
Income From Operations:
Net investment income 0.34 0.70 0.79 0.82 0.27
Net realized and unrealized gain (loss) 0.04 1.06 (0.18) 0.81 1.46*
- ------------------------------------------------------------------------------------------------------------------------------------
Total Income From Operations 0.38 1.76 0.61 1.63 1.73
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions From:
Net investment income (0.36) (0.70) (0.83) (0.82) (0.27)
Net realized gains -- (0.48) (0.38) (0.08) (0.29)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.36) (1.18) (1.21) (0.90) (0.56)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $16.20 $16.18 $15.60 $16.20 $15.47
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return 2.38%++ 11.69% 3.88% 10.76% 12.36%++
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, End of Period (000s) $161,894 $126,766 $72,597 $33,411 $5,395
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to Average Net Assets:
Expenses 1.24%+ 1.25% 1.24% 1.27% 1.29%+
Net investment income 4.10+ 4.38 5.04 4.86 5.67+
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio Turnover Rate 24% 110% 103% 80% 100%
====================================================================================================================================
</TABLE>
(1) On June 12, 1998, Class C shares were renamed Class L shares.
(2) For the six months ended August 31, 1998 (unaudited).
(3) Per share amounts have been calculated using the monthly average shares
method, rather than the undistributed net investment income method, because
it more accurately reflects the per share data for the period.
(4) For the period from November 9, 1994 (inception date) to February 28, 1995.
* The amount shown may not agree with the change in aggregate gains and
losses of portfolio securities due to the timing of sales and redemptions
of Fund shares.
++ Total return is not annualized, as it may not be representative of the
total return for the year.
+ Annualized.
- --------------------------------------------------------------------------------
42 1998 Semi-Annual Report to Shareholders
<PAGE>
================================================================================
Financial Highlights (continued)
================================================================================
For a share of each class of capital stock outstanding throughout each period:
<TABLE>
<CAPTION>
Class Y Shares 1998(1) 1998(2) 1997(2) 1996(3)
====================================================================================================================
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $16.19 $15.60 $16.20 $15.63
- --------------------------------------------------------------------------------------------------------------------
Income From Operations:
Net investment income 0.37 0.82 0.90 0.85
Net realized and unrealized gain (loss) 0.07 1.07 (0.18) 0.65
- --------------------------------------------------------------------------------------------------------------------
Total Income From Operations 0.44 1.89 0.72 1.50
- --------------------------------------------------------------------------------------------------------------------
Less Distributions From:
Net investment income (0.42) (0.82) (0.94) (0.85)
Net realized gains -- (0.48) (0.38) (0.08)
- --------------------------------------------------------------------------------------------------------------------
Total Distributions (0.42) (1.30) (1.32) (0.93)
- --------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $16.21 $16.19 $15.60 $16.20
- --------------------------------------------------------------------------------------------------------------------
Total Return 2.76%++ 12.56% 4.59% 9.84%++
- --------------------------------------------------------------------------------------------------------------------
Net Assets, End of Period (000s) $24,358 $11,893 $5,350 $12,314
- --------------------------------------------------------------------------------------------------------------------
Ratios to Average Net Assets:
Expenses 0.50%+ 0.52% 0.52% 0.57%+
Net investment income 4.86+ 5.06 5.76 5.62+
- --------------------------------------------------------------------------------------------------------------------
Portfolio Turnover Rate 24% 110% 103% 80%
====================================================================================================================
</TABLE>
(1) For the six months ended August 31, 1998 (unaudited).
(2) Per share amounts have been calculated using the monthly average shares
method, rather than the undistributed net investment income method, because
it more accurately reflects the per share data for the period.
(3) For the period from April 4, 1995 (inception date) to February 29, 1996.
++ Total return is not annualized, as it may not be representative of the
total return for the year.
+ Annualized.
- --------------------------------------------------------------------------------
Smith Barney Managed Municipals Fund Inc. 43
<PAGE>
================================================================================
Additional Shareholder Information (unaudited)
================================================================================
On March 9, 1998, a special meeting of shareholders of the Fund was held for the
purpose of voting on the following matters:
1. To elect Directors of the Fund; and
2. To approve or disapprove the reclassification, modification and/or
elimination of certain fundamental investment policies.
The results of the vote on Proposal 1 were as follows:
<TABLE>
<CAPTION>
Shares Voted Percentage Shares Voted Percentage
Name of Director For Shares Voted Against Shares Voted
====================================================================================================================================
<S> <C> <C> <C> <C>
Herbert Barg 112,625,453.104 97.896% 2,420,243.831 2.104%
Alfred J. Bianchetti 112,606,797.606 97.880 2,438,899.329 2.120
Martin Brody 112,597,756.011 97.872 2,447,940.924 2.128
Dwight B. Crane 112,716,679.723 97.976 2,329,017.212 2.024
Burt N. Dorsett 112,785,869.713 98.036 2,259,827.222 1.964
Elliot S. Jaffe 112,726,617.292 97.984 2,319,079.643 2.016
Stephen E. Kaufman 112,778,476.817 98.029 2,267,220.118 1.971
Joseph J. McCann 112,783,037.639 98.033 2,262,659.296 1.967
Heath B. McLendon 112,738,734.539 97.995 2,306,962.396 2.005
Cornelius C. Rose, Jr 112,764,928.596 98.018 2,280,768.339 1.982
====================================================================================================================================
</TABLE>
Proposal 2 requested that shareholders approve certain changes to the
fundamental investment policies of the Fund in order to modernize them in view
of certain regulatory, business or industry developments that have occurred
since original adoption of these policies by the Fund. The following chart
demonstrates that all proposals were approved by the shareholders.
Please note that "M" indicates a modification of the policy and "R" indicates
the reclassification of the policy from fundamental (which would require
shareholder approval to change) to non-fundamental (which can be changed by a
vote of the Board of Directors).
================================================================================
"M" Diversification Approved
- --------------------------------------------------------------------------------
"M" Borrowing Approved
- --------------------------------------------------------------------------------
"M" Lending by the Fund Approved
- --------------------------------------------------------------------------------
"R" Margin and Short-Sales Approved
- --------------------------------------------------------------------------------
"M" Real Estate Approved
- --------------------------------------------------------------------------------
"M" Issuance of Senior Securities Approved
================================================================================
The information below reports the lowest percentage of shares voting for the
proposals, the highest percentage of shares voting against and abstaining by
shareholders of the Fund on all proposals.*
<TABLE>
<CAPTION>
Percentage Percentage Percentage
Shares Voted of Shares Shares Voted of Shares Shares of Shares
For Voted Against Voted Against Abstaining Abstained
====================================================================================================================================
<S> <C> <C> <C> <C> <C>
104,691,943.571 91.344% 2,492,456.398 2.174% 7,428,962.966 6.482%
====================================================================================================================================
</TABLE>
* Broker non-votes constituted less than one percent of shares voted.
- --------------------------------------------------------------------------------
44 1998 Semi-Annual Report to Shareholders
<PAGE>
Smith Barney
Managed Municipals
Fund Inc.
Directors Investment Adviser and Administrator
Herbert Barg Mutual Management Corp.
Alfred J. Bianchetti
Martin Brody
Dwight B. Crane Distributor
Burt N. Dorsett
Elliot S. Jaffe Smith Barney Inc.
Stephen E. Kaufman
Joseph J. McCann
Heath B. McLendon, Chairman Custodian
Cornelius C. Rose
PNC Bank, N.A.
James J. Crisona, Emeritus
Officers
Shareholder Servicing Agent
Heath B. McLendon
President and Chief Executive Officer First Data Investor Services Group, Inc.
P.O. Box 9134
Lewis E. Daidone Boston, MA 02205-9134
Senior Vice President and Treasurer
Joseph P. Deane
Vice President and Investment Officer
This report is submitted for the general
David Fare information of shareholders of Smith
Vice President and Investment Officer Barney Managed Municipals Fund Inc. It
is not for distribution to prospective
Thomas M. Reynolds investors unless accompanied by a
Controller current Prospectus for the Fund, which
contains information concerning the
Christina T. Sydor Fund's investment policies and expenses
Secretary as well as other pertinent information.
SMITH BARNEY
------------
A Member of TravelersGroup [LOGO]
Smith Barney Managed
Municipals Fund Inc.
Smith Barney Mutual Funds
388 Greenwich Street
MF-2
New York, New York 10013
www.smithbarney.com
FD0435 10/98
