1998 SEMIANNUAL REPORT
IDS
Discovery
Fund
(icon of) ship
The goal of IDS Discovery Fund, Inc. is long-term growth of capital. The
Fund invests primarily in common stocks of small- and medium-size growth
companies.
American Express Financial Advisors
Distributed by American Express Financial Advisors Inc.
<PAGE>
(icon of) ship
Your piece of the future
Glance through current business magazines and newspaper articles on the
fastest-growing companies in America and you'll find many of the stocks that
Discovery Fund owns. The Fund seeks smallto medium-size firms at the forefront
of rapidly growing markets or industries. From high-tech companies in computer
networking or biotechnology to firms that have found new ways to make, manage or
market traditional products and services, these are the companies that are
creating jobs and reshaping U.S. industry today.
Contents
From the chairman 3
From the portfolio manager 3
The Fund's ten largest holdings 5
Financial statements 6
Notes to financial statements 9
Investments in securities 23
Board members and officers 27
IDS mutual funds 28
<PAGE>
To our shareholders
From the chairman
If you're an experienced investor, you know that the past few years have
been unusually strong in many financial markets. Perhaps just as
important, history shows that bull markets don't last forever. Though
often unpredictable, declines -- whether they're brief or long-lasting,
moderate or substantial -- are always a possibility. We saw evidence of
that last October, when financial turmoil in Southeast Asia sparked a
sharp decline in worldwide stock markets, including the U.S.
The potential for such volatility reinforces the need for investors to
review periodically their long-term goals and examine whether their
investment program remains on track to achieving them. Your quarterly
investment statements are one part of that monitoring process. The other
is a meeting with your American Express financial advisor. That becomes
even more important if there's a major change in your financial situation
or in the financial markets.
William R. Pearce
(picture of) William R. Pearce
William R. Pearce
Chairman of the Board
<PAGE>
From the portfolio manager
Mixed results for small-capitalization stocks during the past six months
resulted in a virtually flat performance for IDS Discovery Fund in the
first half of its fiscal year. For the period -- August 1997 through
January 1998 -- the Fund's Class A shares produced a total return of 0.1%.
(A decline in the Fund's net asset value, or NAV, over the six months
resulted from a capital gain paid to shareholders last December, which
reduced the NAV by the same amount at that time.)
The period began on a very positive note, as small-cap stocks, which had
trailed their large-cap cousins for much of the past few years, rallied
strongly. In fact, the Fund gained approximately 11% during August and
September, compared with a slight loss for the Standard & Poor's 500 -- an
unmanaged index of stocks commonly used to measure the performance of
large-cap issues.
A case of the Asian flu
The fast start proved to be short-lived, however, as, in October,
crumbling financial markets in Southeast Asia sent shock waves throughout
the world. Particularly affected were stocks of companies in
technology-related businesses, which can derive a substantial portion of
their revenues from Asian economies, and energy services -- two sectors
that comprised a substantial portion of the Fund's assets. As investors
shifted money into the perceived safe haven provided by large-cap issues
and bonds, the small-cap sector continued to struggle through the end of
the period. For the Fund, this trend resulted in a price erosion that
erased nearly all of the early gain.
More consistent performance came from the Fund's investments in
consumer-staple stocks, including food/beverage and health care, and
financial services, including banks and insurance. The former group
benefited from relatively predictable earnings growth, while the latter
was boosted by a healthy decline in long-term interest rates.
Getting a bargain
As for changes to the Fund's holdings, I avoided stocks with high
price/earnings ratios, which appeared most vulnerable to declines induced
by the situation in Asia. At the same time, I did add some stocks of what
I believe are promising companies that became available at bargain prices.
I kept the portfolio essentially fully invested (minimal cash reserves) --
a strategy that, while it results in greater short-term price volatility,
provides the opportunity for greater gain over the long term.
As the second half of the fiscal year begins, the good news is that the
fundamentals for small-cap stocks remain favorable, particularly their
valuation level compared with many large-cap issues. Plus, the economy
continues to march on while inflation has yet to become a threat. On the
other hand, the fallout from the Asian situation may be with us for some
months. In the meantime, I intend to keep the Fund fully invested so that
it will be in position to benefit from potential upturns in the market.
Kurt Winters
(picture of) Kurt Winters
Kurt Winters
Portfolio Manager
<PAGE>
Class A
6-month performance
(All figures per share)
Net asset value (NAV)
Jan. 31, 1998 $ 11.48
July 31, 1997 $ 13.02
Decrease $ 1.54
Distributions
Aug. 1, 1997 - Jan 31, 1998
From income $ 1.01
From capital gains $ 0.55
Total distributions$ 1.56
Total return* +0.1%**
Class B
6-month performance
(All figures per share)
Net asset value (NAV)
Jan. 31, 1998 $ 11.23
July 31, 1997 $ 12.82
Decrease $ 1.59
Distributions
Aug. 1, 1997 - Jan. 31, 1998
From income $ 1.01
From capital gains $ 0.55
Total distributions$ 1.56
Total return* -0.2%**
Class Y
6-month performance
(All figures per share)
Net asset value (NAV)
Jan. 31, 1998 $ 11.49
July 31, 1997 $ 13.03
Decrease $ 1.54
Distributions
Aug. 1, 1997 - Jan. 31, 1998
From income $ 1.01
From capital gains $ 0.55
Total distributions$ 1.56
Total return* +0.2%**
*The prospectus discusses the effect of sales charges, if any, on the
various classes.
**The total return is a hypothetical investment in the Fund with all
distributions reinvested.
<PAGE>
The Fund's ten largest holdings
Percent Value
(of Fund's net assets) (as of Jan. 31, 1998)
Watson Pharmaceuticals 2.90% $32,156,250
AccuStaff 2.79 30,900,000
FelCor Suite Hotels 2.70 29,850,000
Jacobs Engineering Group 2.68 29,631,249
Steel Dynamics 2.62 29,000,000
Quorum Health Group 2.60 28,750,000
OfficeMax 2.51 27,787,500
Kemet 2.51 27,750,000
Camco Intl 2.47 27,343,750
Millipore 2.36 26,200,000
(icon of) pie chart
The ten holdings listed here make up 26.14% of the Fund's net assets
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<TABLE>
<CAPTION>
Financial statements
Statement of assets and liabilities IDS Discovery Fund, Inc.
Jan. 31, 1998
Assets
(Unaudited)
Investments in securities, at value (Note 1):
<S> <C>
Investments in securities of unaffiliated issuers
(identified cost $953,881,647) $1,048,220,661
Investments in securities of affiliated issuers
(identified cost $58,456,328) 63,682,813
Cash in bank on demand deposit 1,968,624
Dividends and accrued interest receivable 89,618
Receivable for investment securities sold 7,859,140
Deposits for securities sold short (Notes 1 and 3) 3,853,908
---------
Total assets 1,125,674,764
-------------
Liabilities
Payable upon return of securities loaned (Note 6) 11,412,500
Accrued investment management services fee 47,036
Accrued distribution fee 2,521
Accrued service fee 5,185
Accrued transfer agency fee 4,430
Accrued administrative services fee 1,567
Other accrued expenses 130,340
Open option contracts written, at value
(premium received $3,588,095) 2,732,031
Securities sold short (Notes 1 and 3) 4,256,250
---------
Total liabilities 18,591,860
----------
Net assets applicable to outstanding capital stock $1,107,082,904
==============
Represented by
Capital stock-- $.01 par value (Note 1) $ 966,998
Additional paid-in capital 965,241,267
Investment loss-- net (1,661,445)
Accumulated net realized gain (loss) 42,516,863
Unrealized appreciation (depreciation) on investments 100,019,221
-----------
Total-- representing net assets applicable to outstanding capital stock $1,107,082,904
==============
Net assets applicable to outstanding shares: Class A $ 900,961,699
Class B $ 123,090,458
Class Y $ 83,030,747
Net asset value per share of outstanding capital stock: Class A shares 78,509,163 $ 11.48
Class B shares 10,964,364 $ 11.23
Class Y shares 7,226,308 $ 11.49
See accompanying notes to financial statements.
</TABLE>
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<TABLE>
<CAPTION>
Statement of operations
IDS Discovery Fund, Inc.
Six months ended Jan. 31, 1998
Investment income
(Unaudited)
Income:
<S> <C>
Dividends (including $50,000 earned from affiliates) $ 2,613,024
Interest 1,797,360
---------
Total income 4,410,384
---------
Expenses (Note 2):
Investment management services fee 3,778,857
Distribution fee -- Class B 436,813
Transfer agency fee 779,199
Incremental transfer agency fee-- Class B 7,054
Service fee
Class A 810,293
Class B 101,537
Class Y 40,680
Administrative services fees and expenses 296,600
Compensation of board members 6,098
Custodian fees 63,450
Postage 34,649
Registration fees 70,184
Reports to shareholders 19,215
Audit fees 13,000
Other 9,033
-----
Total expenses 6,466,662
Earnings credits on cash balances (Note 2) (81,626)
-------
Total net expenses 6,385,036
---------
Investment income (loss) -- net (1,974,652)
----------
Realized and unrealized gain (loss) -- net
Net realized gain (loss) on:
Security transactions
(including gain of $6,774,976 on sale of affiliated issuers) (Note 3) 122,095,726
Options contracts written (Note 5) 827,427
Closed short positions in securities (Notes 1 and 3) (1,207,653)
----------
Net realized gain (loss) on investments 121,715,500
Net change in unrealized appreciation (depreciation) on investments (117,199,559)
------------
Net gain (loss) on investments 4,515,941
---------
Net increase (decrease) in net assets resulting from operations $ 2,541,289
=============
See accompanying notes to financial statements.
</TABLE>
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<TABLE>
<CAPTION>
Financial statements
Statements of changes in net assets
IDS Discovery Fund, Inc.
Operations and distributions Jan. 31, 1998 July 31, 1997
Six months ended Year ended
(Unaudited)
<S> <C> <C>
Investment income (loss)-- net $ (1,974,652) $ (3,346,524)
Net realized gain (loss) on investments 121,715,500 64,779,024
Net change in unrealized appreciation (depreciation) on investments (117,199,559) 244,479,200
------------ -----------
Net increase (decrease) in net assets resulting from operations 2,541,289 305,911,700
--------- -----------
Distributions to shareholders from:
Net investment income
Class A -- (1,927,449)
Class Y -- (265,909)
Net realized gain
Class A (107,350,567) (99,183,189)
Class B (14,584,207) (8,597,468)
Class Y (9,866,379) (8,324,287)
---------- ----------
Total distributions (131,801,153) (118,298,302)
------------ ------------
Capital share transactions (Note 4)
Proceeds from sales
Class A shares (Note 2) 674,032,820 736,250,317
Class B shares 30,821,378 48,300,963
Class Y shares 30,951,973 38,054,111
Reinvestment of distributions at net asset value
Class A shares 104,918,617 98,136,993
Class B shares 14,494,574 8,547,699
Class Y shares 9,866,379 8,590,196
Payments for redemptions
Class A shares (679,470,547) (773,305,648)
Class B shares (Note 2) (7,256,418) (14,227,780)
Class Y shares (19,489,599) (38,438,270)
----------- -----------
Increase (decrease) in net assets from capital share transactions 158,869,177 111,908,581
----------- -----------
Total increase (decrease) in net assets 29,609,313 299,521,979
Net assets at beginning of period 1,077,473,591 777,951,612
------------- -----------
Net assets at end of period $1,107,082,904 $1,077,473,591
============== ==============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
Notes to financial statements
IDS Discovery Fund, Inc.
(Unaudited as to Jan. 31, 1998)
1
Summary of
significant
accounting policies
IDS Discovery Fund, Inc. is registered under the Investment Company Act of
1940 (as amended) as a diversified, open-end management investment
company. The Fund has 10 billion authorized shares of capital stock. The
Fund invests primarily in common stocks of small- and medium-size growth
companies. The Fund offers Class A, Class B and Class Y shares. Class A
shares are sold with a front-end sales charge. Class B shares may be
subject to a contingent deferred sales charge and such shares
automatically convert to Class A shares during the ninth calendar year of
ownership. Class Y shares have no sales charge and are offered only to
qualifying institutional investors.
All classes of shares have identical voting, dividend, liquidation and
other rights, and the same terms and conditions, except that the level of
distribution fee, transfer agency fee and service fee (class specific
expenses) differs among classes. Income, expenses (other than class
specific expenses) and realized and unrealized gains or losses on
investments are allocated to each class of shares based upon its relative
net assets.
Significant accounting policies followed by the Fund are summarized below:
Use of estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of increase and decrease in
net assets from operations during the period. Actual results could differ
from those estimates.
Valuation of securities
All securities are valued at the close of each business day. Securities
traded on national securities exchanges or included in national market
systems are valued at the last quoted sales price. Debt securities are
generally traded in the over-the-counter market and are valued at a price
deemed best to reflect fair value as quoted by dealers who make markets in
these securities or by an independent pricing service. Securities for
which market quotations are not readily available are valued at fair value
according to methods selected in good faith by the board. Short-term
securities maturing in more than 60 days from the valuation date are
valued at the market price or approximate market value based on current
interest rates; those maturing in 60 days or less are valued at amortized
cost.
Option transactions
In order to produce incremental earnings, protect gains, and facilitate
buying and selling of securities for investment purposes, the Fund may buy
and write options traded on any U.S. or foreign exchange or in the
over-the-counter market where the completion of the obligation is
dependent upon the credit standing of the other party. The Fund also may
buy and sell put and call options and write covered call options on
portfolio securities and may write cash-secured put options. The risk in
writing a call option is that the Fund gives up the opportunity of profit
if the market price of the security increases. The risk in writing a put
option is that the Fund may incur a loss if the market price of the
security decreases and the option is exercised. The risk in buying an
option is that the Fund pays a premium whether or not the option is
exercised. The Fund also has the additional risk of not being able to
enter into a closing transaction if a liquid secondary market does not
exist.
Option contracts are valued daily at the closing prices on their primary
exchanges and unrealized appreciation or depreciation is recorded. The
Fund will realize a gain or loss upon expiration or closing of the option
transaction. When an option is exercised, the proceeds on sales for a
written call option, the purchase cost for a written put option or the
cost of a security for a purchased put or call option is adjusted by the
amount of premium received or paid.
Futures transactions
In order to gain exposure to or protect itself from changes in the market,
the Fund may buy and sell financial futures contracts traded on any U.S.
or foreign exchange. The Fund also may buy and write put and call options
on these future contracts. Risks of entering into futures contracts and
related options include the possibility that there may be an illiquid
market and that a change in the value of the contract or option may not
correlate with changes in the value of the underlying security.
Upon entering into a futures contract, the Fund is required to deposit
either cash or securities in an amount (initial margin) equal to a certain
percentage of the contract value. Subsequent payments (variation margin),
if any, are made or received by the Fund each day. The variation margin
payments are equal to the daily changes in the contract value and are
recorded as unrealized gains and losses. The Fund recognizes a realized
gain or loss when the contract is closed or expires.
Foreign currency translations and
foreign currency contracts
Securities and other assets and liabilities denominated in foreign
currencies are translated daily into U.S. dollars at the closing rate of
exchange. Foreign currency amounts related to the purchase or sale of
securities and income and expenses are translated at the exchange rate on
the transaction date. The effect of changes in foreign exchange rates on
realized and unrealized security gains or losses is reflected as a
component of such gains or losses. In the statement of operations, net
realized gains or losses from foreign currency transactions may arise from
sales of foreign currency, closed forward contracts, exchange gains or
losses realized between the trade date and settlement dates on securities
transactions, and other translation gains or losses on dividends, interest
income and foreign withholding taxes.
The Fund may enter into forward foreign currency exchange contracts for
operational purposes and to protect against adverse exchange rate
fluctuation. The net U.S. dollar value of foreign currency underlying all
contractual commitments held by the Fund and the resulting unrealized
appreciation and/or depreciation are determined using foreign currency
exchange rates from an independent pricing service. The Fund is subject to
the credit risk that the other party will not complete the obligations of
the contract.
Short sales
The Fund may engage in short sales. In these transactions, the Fund sells
a security that it does not own in anticipation of a decline in the market
value of the security. To complete the transaction, the Fund must borrow
the security to make delivery to the buyer. The Fund is obligated to
replace the security that was borrowed by purchasing it at the market
price on the replacement date. The price at such time may be more or less
than the price at which the Fund sold the security. The Fund will
designate cash or liquid securities to cover its open short positions. The
Fund also may engage in "short sales against the box," a form of
short-selling that involves selling a security that the Fund owns (or has
an unconditioned right to purchase) for delivery at a specified date in
the future. This technique allows the Fund to hedge protectively against
anticipated declines in the market of its securities or to defer an
unrealized gain. If the value of the securities sold short increased prior
to the scheduled delivery date, the Fund loses the opportunity to
participate in the gain.
Federal taxes
Since the Fund's policy is to comply with all sections of the Internal
Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to shareholders, no provision for
income or excise taxes is required.
Net investment income (loss) and net realized gains (losses) may differ
for financial statement and tax purposes primarily because of the deferral
of losses on certain futures contracts, the recognition of certain foreign
currency gains (losses) as ordinary income (loss) for tax purposes and
losses deferred due to "wash sale" transactions. The character of
distributions made during the year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to the timing of dividend distributions,
the fiscal year in which amounts are distributed may differ from the year
that the income or realized gains (losses) were recorded by the Fund.
Dividends to shareholders
An annual dividend from net investment income, declared and paid at the
end of the calendar year, is reinvested in additional shares of the Fund
at net asset value or payable in cash. Capital gains, when available, are
distributed along with the income dividend.
Other
Security transactions are accounted for on the date securities are
purchased or sold. Dividend income is recognized on the ex-dividend date
and interest income, including level-yield amortization of premium and
discount, is accrued daily.
2
Expenses and
sales charges
Effective March 20, 1995, the Fund entered into agreements with American
Express Financial Corporation (AEFC) for managing its portfolio, providing
administrative services and serving as transfer agent. Under an Investment
Management Services Agreement, AEFC determines which securities will be
purchased, held or sold. The management fee is a percentage of the Fund's
daily net assets in reducing percentages from 0.64% to 0.515% annually.
The fee is adjusted upward or downward by a performance incentive
adjustment based on the Fund's average daily net assets over a rolling
12-month period as measured against the change in the Lipper Small Company
Growth Fund Index. The maximum adjustment is 0.12% of the Fund's average
daily net assets after deducting 1% from the performance difference. If
the performance difference is less than 1%, the adjustment will be zero.
The adjustment increased the fee by $399,782 for the six months ended Jan.
31, 1998.
Under an Administrative Services Agreement, the Fund pays AEFC a fee for
administration and accounting services at a percentage of the Fund's
average daily net assets in reducing percentages from 0.06% to 0.035%
annually. Additional administrative service expenses paid by the Fund are
office expenses, consultants' fees and compensation of officers and
employees. Under this agreement, the Fund also pays taxes, audit and
certain legal fees, registration fees for shares, compensation of board
members, corporate filing fees, organizational expenses and any other
expenses properly payable by the Fund and approved by the board.
Under a separate Transfer Agency Agreement, American Express Client
Service Corporation (AECSC) maintains shareholder accounts and records.
The Fund pays AECSC an annual fee per shareholder account for this service
as follows:
oClass A $15
oClass B $16
oClass Y $15
Also effective March 20, 1995, the Fund entered into agreements with
American Express Financial Advisors Inc. for distribution and shareholder
servicing-related services. Under a Plan and Agreement of Distribution,
the Fund pays a distribution fee at an annual rate of 0.75% of the Fund's
average daily net assets attributable to Class B shares for
distribution-related services.
Under a Shareholder Service Agreement, the Fund pays a fee for service
provided to shareholders by financial advisors and other servicing agents.
The fee is calculated at a rate of 0.175% of the Fund's average daily net
assets attributable to Class A and Class B shares and commencing on May 9,
1997, the fee is calculated at a rate of 0.10% of the Fund's average daily
net assets attributable to Class Y shares.
Sales charges received by American Express Financial Advisors Inc. for
distributing Fund shares were $998,281 for Class A and $36,301 for Class B
for the six months ended Jan. 31, 1998. The Fund also pays custodian fees
to American Express Trust Company, an affiliate of AEFC.
During the six months ended Jan. 31, 1998, the Fund's custodian and
transfer agency fees were reduced by $81,626 as a result of earnings
credits from overnight cash balances.
3
Securities
transactions
Cost of purchases and proceeds from sales of securities (other than
short-term obligations) aggregated $852,569,391 and $872,614,304,
respectively, for the six months ended Jan. 31, 1998. Realized gains and
losses are determined on an identified cost basis.
Brokerage commissions paid to brokers affiliated with AEFC were $142,317
for the six months ended Jan. 31, 1998.
At Jan. 31, 1998, the following security was
sold short.
Issuer Shares Value
________________________________________________________________________
Dollar Tree 100,000 $4,256,250
4
Capital share
transactions
Transactions in shares of capital stock for the periods indicated are as
follows:
Six months ended Jan. 31, 1998
Class A Class B Class Y
Sold 51,245,565 2,359,524 2,286,000
Issued for reinvested 9,196,137 1,297,867 863,804
distributions
Redeemed (51,369,680) (562,280) (1,459,797)
----------- -------- ----------
Net increase (decrease) 9,072,022 3,095,111 1,690,007
--------- --------- ---------
Year ended July 31, 1997
Class A Class B Class Y
Sold 62,998,962 4,259,010 3,296,071
Issued for reinvested 8,966,980 777,346 772,708
distributions
Redeemed (66,170,688) (1,258,366) (3,358,084)
----------- ---------- ----------
Net increase (decrease) 5,795,254 3,777,990 710,695
--------- --------- -------
5
Option contracts
written
The number of contracts and premium amounts associated with options
contracts written is as follows:
Six months ended Jan. 31, 1998
Puts Calls
Contracts Premium Contracts Premium
Balance July 31, 1997 5,750 $ 881,815 31,750 $ 6,109,809
Opened 51,175 10,464,321 45,200 33,432,996
Closed (41,165) (8,054,622) (31,445) (29,228,125)
Exercised (6,820) (1,244,403) (23,503) (6,329,166)
Expired (940) (310,045) (12,752) (2,134,485)
---- -------- ------- ----------
Balance Jan. 31, 1998 8,000 $ 1,737,066 9,250 $ 1,851,029
----- ------------ ----- -------------
See summary of significant accounting policies.
6
Lending of
portfolio securities
At Jan. 31, 1998, securities valued at $11,056,475 were on loan to
brokers. For collateral, the Fund received $11,412,500 in cash. Income
from securities lending amounted to $113,123 for the six months ended Jan.
31, 1998. The risk to the Fund of securities lending are that the borrower
may not provide additional collateral when required or return the
securities when due.
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<TABLE>
<CAPTION>
7
Notes to financial statements
IDS Discovery Fund, Inc.
Financial
highlights
The tables below show certain important financial information for evaluating the
Fund's results.
Fiscal period ended Jan. 31,
Per share income and capital changesa
Class A
1998b 1997 1996 1995 1994 1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, $13.02 $10.73 $13.16 $10.33 $11.37 $9.87 $9.58 $9.05 $7.75 $6.69
beginning of
period
Income from investment operations:
Net investment (.02) (.04) .06 .07 (.04) (.02) (.01) .04 .14 .13
income
(loss)
Net gains (losses) .04 3.95 .34 2.79 (.52) 1.75 1.01 1.03 1.35 .98
(both realized
and unrealized)
Total from .02 3.91 .40 2.86 (.56) 1.73 1.00 1.07 1.49 1.11
investment
operations
Less distributions:
Dividends from net -- (.03) (.09) -- -- -- (.02) (.11) (.14) (.05)
investment income
Distributions (1.56) (1.59) (2.74) (.03) (.48) (.23) (.69) (.43) (.05) --
from
realized gains
Total (1.56) (1.62) (2.83) (.03) (.48) (.23) (.71) (.54) (.19) (.05)
distributions
Net asset value, $11.48 $13.02 $10.73 $13.16 $10.33 $11.37 $9.87 $9.58 $9.05 $7.75
end of period
Ratios/supplemental data
Class A
1998b 1997 1996 1995 1994 1993 1992 1991 1990 1989
Net assets, end of $901 $904 $683 $730 $523 $445 $293 $207 $168 $167
period (in
millions)
Ratio of expenses 1.07%c 1.13% 1.00% .99% .97% 1.03% 1.04% .98% .76% .66%
to
average daily net
assetsd
Ratio of net (.28%)c (.32%) .46% .59% (.39%) (.17%) (.11%) .40% 1.51% 1.86%
income (loss) to
average daily
net assets
Portfolio 79% 153% 179% 192% 67% 76% 90% 95% 76% 109%
turnover rate
(excluding
short-term
securities)
Total returne .1% 39.1% 4.0% 27.6% (5.5%) 17.5% 9.9% 13.4% 19.8% 16.7%
Average brokerage $.0533 $.0502 -- -- -- -- -- -- -- --
commission ratef
a For a share outstanding throughout the period. Rounded to the
nearest cent.
b Six months ended Jan. 31, 1998 (Unaudited).
c Inception date was March 20, 1996.
d Adjusted to an annual basis.
e Effective fiscal year 1996, expense ratio is based on total expenses
of the Fund before reduction of earnings credits on cash balances.
f Total return does not reflect payment of a sales charge.
g Effective fiscal year 1997, the Fund is required to disclose an
average brokerage commission rate per share for security trades
on which commissions are charged. The comparablity of this
information may be affected by the fact that commission rates per
share vary significantly among foreign countries.
</TABLE>
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<TABLE>
<CAPTION>
Fiscal period ended July 31,
Per share income and capital
changes(a)
Class B Class Y
1998b 1997 1996 1995c 1998b 1997 1996 1995c
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, $12.82 $10.63 $13.12 $11.31 $13.03 $10.73 $13.17 $11.31
beginning of
period
Income from investment operations:
Net investment (.06) (.11) -- .01 (.01) (.01) .07 .07
income
(loss)
Net gains (both .03 3.89 .31 1.80 .03 3.95 .34 1.80
realized
and unrealized)
Total from (.03) 3.78 .31 1.81 .02 3.94 .41 1.86
investment
operations
Less
distributions:
Dividends from net -- -- (.06) -- -- (.05) (.11) --
investment income
Distributions (1.56) (1.59) (2.74) -- (1.56) (1.59) (2.74) --
from
realized gains
Total (1.56) (1.59) (2.80) -- (1.56) (1.64) (2.85) --
distributions
Net asset value, $11.23 $12.82 $10.63 $13.12 $11.49 $13.03 $10.73 $13.17
end of period
Ratios/supplemental
data
Class B Class Y
1998b 1997 1996 1995c 1998b 1997 1996 1995c
Net assets, end of $123 $101 $43 $10 $83 $72 $52 $39
period (in
millions)
Ratio of expenses 1.83%d 1.90% 1.74% 1.95%d .99%d .98% .81% .93%d
to
average daily net
assetse
Ratio of net (.99%)d (1.10%) (.10%) .44%d (.20%)d (.17%) .61% 1.51%d
income (loss)
to average daily
net assets
Portfolio 79% 153% 179% 192% 79% 153% 179% 192%
turnover rate
(excluding
short-term
securities)
Total returnf (.2%) 38.1% 3.2% 16.0% .2% 39.3% 4.2% 16.4%
Average brokerage $.0533 $.0502 -- -- $.0533 $.0502 -- --
commission rateg
a For a share outstanding throughout the period. Rounded to the nearest
cent.
b Six months ended Jan. 31, 1998 (Unaudited).
c Inception date was March 20, 1995.
d Adjusted to an annual basis.
e Effective fiscal year 1996, expense ratio is based on total expenses of
the Fund before reduction of earnings credits on cash balances.
f Total return does not reflect payment of a sales charge.
g Effective fiscal year 1997, the Fund is required to disclose an average
brokerage commission rate per share for security trades on which
commissions are charged. The comparability of this information may be
affected by the fact that commission rates per share vary significantly
among foreign countries.
</TABLE>
<PAGE>
Investments in securities
IDS Discovery Fund, Inc.
Jan. 31, 1998 (Unaudited)
(Percentages represent
value of investments
compared to net assets)
Investments in securities of unaffiliated issuers
Common stocks (87.5%)
Issuer Shares Value(a)
Issuer Shares Value(a)
Aerospace & defense (1.3%)
BE Aerospace 600,000(b) $ 14,475,000
Airlines (1.2%)
Aviation Sales Co 350,000(b) 13,103,125
Banks and savings & loans (1.1%)
Ocwen Financial 475,000(b) 12,290,625
Chemicals (2.4%)
Millipore 800,000 26,200,000
Communications equipment & services (1.2%)
PairGain Technologies 725,000(b,d) 13,321,875
Computers & office equipment (10.5%)
Envoy 400,000(b,c,d)15,099,999
Hadco 325,000(b,d) 13,802,344
Harbinger 325,000(b,d) 8,043,750
Renaissance Worldwide 275,000(b) 13,423,438
Sanmina 225,000(b,d) 15,131,249
Sterling Software 350,000(b) 13,387,500
Sykes Enterprises 650,000(b,d) 14,625,000
Tech Data 350,000(b,d) 14,831,250
Viasoft 275,000(b,d) 8,301,563
Total 116,646,093
Electronics (5.4%)
KLA-Tencor 500,000(b,d) 18,750,000
Lattice Semiconductor 300,000(b) 13,837,500
PRI Automation 450,000(b,d) 12,375,000
Waters 325,000(b) 14,990,625
Total 59,953,125
Energy (3.9%)
Devon Energy 350,000(d) 12,206,250
KCS Energy 725,000 12,143,750
Rutherford-Moran Oil 650,000(b) 12,106,250
Stone Energy 200,000(b) 6,475,000
Total 42,931,250
Energy equipment & services (8.9%)
Atwood Oceanics 325,000(b) 13,406,250
Camco Intl 500,000(b,d) 27,343,750
Hanover Compressor 700,000(b,d) 12,381,250
Jacobs Engineering Group1,100,000(b) 29,631,249
Pride Intl 750,000(b,d) 15,984,375
Total 98,746,874
Financial services (2.3%)
CMAC Investment 200,000 12,475,000
PMT Services 900,000(b) 12,543,750
Total 25,018,750
Food (3.0%)
JP Foodservice 550,000(b,d) 19,215,625
Suiza Foods 225,000(b) 13,710,938
Total 32,926,563
Health care (6.6%)
STERIS 275,000(b,d)14,403,125
Sybron Intl 550,000(b) 26,090,625
Watson Pharmaceuticals 875,000(b) 32,156,250
Total 72,650,000
Health care services (8.7%)
Equity Corp Intl 525,000(b) 10,368,750
Express Scripts Cl A 200,000(b) 12,250,000
Genesis Health Ventures 550,000(b,c)14,987,500
Quintiles Transnational 500,000(b) 19,031,250
Quorum Health Group 1,150,000(b) 28,750,000
Shared Medical Systems 175,000(d) 11,462,500
Total 96,850,000
Industrial equipment & services (4.6%)
Integrated Process
Equipment 800,000(b) 11,700,000
Kemet 1,500,000(b) 27,750,000
Rental Service 500,000(b,d)10,968,750
Total 50,418,750
Insurance (1.0%)
Vesta Insurance Group 200,000 11,300,000
Media (1.7%)
Regal Cinemas 650,000(b) 18,890,625
Metals (5.3%)
Steel Dynamics 1,450,000(b) 29,000,000
Stillwater Mining 750,000(b) 14,765,625
Titanium Metals 575,000(b) 15,273,438
Total 59,039,063
Multi-industry conglomerates (2.8%)
AccuStaff 1,200,000(b) 30,900,000
Real estate investment trust (5.8%)
FelCor Suite Hotels 800,000 29,850,000
First Union Real
Estate Investments 750,000 8,953,125
Kilroy Realty 475,000 13,537,500
Storage USA 300,000 11,718,750
Total 64,059,375
Restaurants & lodging (1.1%)
Landry's Seafood
Restaurants 575,000(b,d)12,721,875
Retail (2.5%)
OfficeMax 1,900,000(b) 27,787,500
Utilities -- telephone (4.9%)
ICG Communications 450,000(b,d)11,081,250
Intermedia
Communications 275,000(b,d)16,912,500
LCI Intl 900,000(b) 25,818,750
Total 53,812,500
Foreign (1.3%)(g)
Core Laboratories 750,000(b) 14,812,500
Total common stocks
(Cost: $874,722,191) $ 968,855,468
Options purchased (0.1%)
Issuer Number of Exercise Expiration Value(a)
contracts price date
Calls
Stillwater Mining 2,500 $22 April 1998 $ 242,188
Stone Energy 2,500 30 June 1998 1,375,000
Total $1,617,188
Total options purchased $1,617,188
(Cost: $1,411,451)
Short-term securities (7.0%)
Issuer Annualized Amount Value(a)
yield on payable at
date of maturity
purchase
U.S. government agencies (1.6%)
Federal Home Loan Mtge Corp Disc Nts
02-06-98 5.40% $ 700,000 $699,372
02-17-98 5.39 5,000,000 4,987,321
02-26-98 5.40 5,300,000 5,279,407
Federal Natl Mtge Assn Disc Nts
02-17-98 5.40 5,000,000 4,987,297
02-27-98 5.46 1,500,000 1,493,880
Total 17,447,277
Commercial paper (5.4%)
Ameritech
02-03-98 5.91 6,400,000 6,396,869
Bell Atlantic Financial Services
02-27-98 5.49 8,800,000 8,763,898
Ciesco LP
02-25-98 5.52 3,500,000 3,486,632
Commerzbank U.S. Finance
02-13-98 5.47 10,200,000 10,179,926
Fleet Funding
02-19-98 5.51 1,800,000(e) 1,794,794
Gannett
02-24-98 5.48 3,300,000(e) 3,288,010
Merrill Lynch
02-18-98 5.49 7,400,000 7,379,761
Morgan Stanley, Dean
Witter, Discover & Co
03-02-98 5.50 9,000,000 8,958,975
Novartis Financial (Delaware)
03-03-98 5.52 8,000,000 7,962,111
Toyota Motor Credit
03-04-98 5.51 2,100,000 2,089,752
Total 60,300,728
Total short-term securities
(Cost: $77,748,005) $77,748,005
Total investments in securities of unaffiliated issuers
(Cost: $953,881,647) $1,048,220,661
Common stocks (5.8%)
Issuer Shares Value(a)
ChiRex 1,100,000(b,d)14,712,500
Commonwealth Inds 800,000 11,200,000
Domain Energy 825,000(b) 11,395,313
Dura Automotive
Systems Cl A 500,000(b) 13,625,000
Gulf South Medical Supply 400,000(b) 12,750,000
Total $63,682,813
Total investments in securities of affiliated issuers
(Cost: $58,456,328) $63,682,813
Total investments in securities
(Cost: $1,012,337,975)(h) $1,111,903,474
==============
Notes to investments in securities
(a) Securities are valued by procedures described in Note 1 to the financial
statements.
(b) Non-income producing.
(c) Security was partially or fully on loan. See Note 6 to the financial
statements.
(d) At Jan. 31, 1998, securities valued at $29,100,001 were held to cover open
call options written as follows:
Issuer Shares Exercise Expiration Value(a)
price date
ChiRex 100,000 $15 March 1998 $ 81,250
Devon Energy 25,000 35 Feb. 1998 28,906
Envoy 75,000 35 March 1998 323,438
Hanover Compressor 25,000 20 Feb. 1998 12,500
ICG Communications 75,000 30 Feb. 1998 9,375
Intermedia Communications 25,000 55 Feb. 1998 187,500
KLA-Tencor 150,000 45 March 1998 210,938
PairGain Technologies 125,000 20 April 1998 210,937
Pride Intl 50,000 22 March 1998 59,375
STERIS 25,000 50 Feb. 1998 78,125
STERIS 125,000 55 March 1998 257,812
Sykes Enterprises 50,000 20 Feb. 1998 153,125
Viasoft 75,000 50 Feb. 1998 9,375
------ -- ---- -----
Total $1,622,656
----------
<PAGE>
<TABLE>
<CAPTION>
Investments in securities
IDS Discovery Fund, Inc.
Notes to investments in securities
At Jan. 31, 1998, cash or short-term securities were designated to cover open put options written
as follows:
Issuer Shares Exercise Expiration Value(a)
price date
<S> <C> <C> <C> <C>
Camco Intl 25,000 $55 Feb. 1998 $ 62,500
Camco Intl 25,000 60 Feb. 1998 146,875
Hadco 25,000 45 Feb. 1998 95,312
Harbinger 75,000 25 Feb. 1998 103,125
JP Foodservice 50,000 35 Feb. 1998 43,750
KLA-Tencor 100,000 35 Feb. 1998 112,500
Landry's Seafood Restaurants 25,000 25 Feb. 1998 73,437
Omnipoint 250,000 20 March 1998 70,312
PRI Automation 50,000 25 Feb. 1998 35,938
Rental Service 25,000 22 Feb. 1998 23,438
Sanmina 50,000 60 Feb. 1998 48,438
Shared Medical Systems 25,000 60 Feb. 1998 9,375
Tech Data 50,000 35 Feb. 1998 28,125
Viasoft 25,000 40 March 1998 256,250
Total $1,109,375
(e) Commercial paper sold within terms of a private placement memorandum, exempt
from registration under Section 4(2) of the Securities Act of 1933, as amended,
and may be sold only to dealers in that program or other "accredited investors."
This security has been determined to be liquid under guidelines established by
the board.
(f) Investments representing 5% or more of the outstanding voting securities of
the issuer. Transactions with companies that are or were affiliates during the
period ended Jan. 31, 1998 are
as follows:
Issuer Beginning Purchase Sales Ending Dividend
cost cost cost cost income
ChiRex $ 8,071,489 $ 6,171,778 $ 511,313 $13,731,954 $ --
Commonwealth Inds* 6,800,627 6,428,412 -- 13,229,039 50,000
Domain Energy* 8,865,395 3,745,011 1,012,500 11,597,906 --
Dura Automotive Systems 7,435,610 5,492,500 -- 12,928,110 --
Gulf South Medical Supply* 19,561,945 -- 12,592,626 6,969,319 --
Project Software & Development* 10,347,322 3,069,376 13,416,698 -- --
Transaction Network Services* 8,500,984 1,215,938 9,716,922 -- --
Total $69,583,372 $26,123,015 $37,250,059 $58,456,328 $50,000
*Issuer was not an affiliate for the entire period.
(g) Foreign security values are stated in U.S. dollars.
(h) At Jan. 31, 1998, the cost of securities for federal income tax purposes was
approximately $1,012,338,000 and the approximate aggregate gross unrealized
appreciation and depreciation based on that cost was:
Unrealized appreciation............................................................................$133,471,000
Unrealized depreciation......................................................................... (33,906,000)
Net unrealized appreciation.......................................................................$ 99,565,000
</TABLE>
<PAGE>
Board members and officers
Independent board members and officers
Chairman William R. Pearce*
of the board Chairman of the board, Board Services Corporation (provides
administrative services to boards including the boards of the
IDS and IDSLife funds and Master Trust portfolios).
H. Brewster Atwater, Jr.
Former chairman and chief executive officer, General Mills,
Inc.
Lynne V. Cheney
Distinguished fellow, American Enterprise Institute for Public
Policy Research.
Heinz F. Hutter
Former president and chief operating officer, Cargill, Inc.
Anne P. Jones
Attorney and telecommunications consultant.
Alan K. Simpson
Former United States senator for Wyoming.
Edson W. Spencer
Former chairman and chief executive officer, Honeywell, Inc.
Wheelock Whitney
Chairman, Whitney Management Company.
C. Angus Wurtele
Chairman of the board, The Valspar Corporation.
Officer
Vice president, Leslie L. Ogg*
general counsel President, treasurer and corporate secretary of Board Services
and secretary Corporation.
Board members and officers associated with AEFC
President John R. Thomas*
Senior vice president, AEFC.
William H. Dudley*
Senior advisor to the chief executive officer, AEFC.
David R. Hubers*
President and chief executive officer, AEFC.
Officers associated with AEFC
Vice president Peter J. Anderson*
Senior vice president, AEFC
Treasurer Matthew N. Karstetter*
Vice president, AEFC
* Interested person as defined by the Investment Company Act of 1940.
<PAGE>
IDS mutual funds
Global/International funds
Funds in this group seek capital growth and/or income by investing primarily in
foreign securities. Foreign investments may be subject to currency fluctuations
and political and economic risks of the countries in which the investments are
made. They are high risk mutual funds with a potential for high reward.
IDS Emerging Markets Fund
Invests in a Portfolio comprised primarily of stocks of companies in developing
countries throughout the world that are believed to offer growth potential.
Seeks to provide long-term growth of capital.
(icon of) world with countries
IDS Global Growth Fund
Invests in a Portfolio comprised primarily of stocks of companies throughout the
world that are positioned to meet market needs in a changing world economy.
These companies offer above-average potential for long-term growth.
(icon of) world
IDS International Fund
Invests primarily in common stocks of foreign companies that offer potential for
superior growth. The Fund may invest up to 20% of its assets in the U.S. market.
(icon of) three flags
IDS Global Balanced Fund
Invests in stocks and bonds in, for the most part, major markets throughout the
world, including the U.S. Seeks to provide a balance of growth of capital and
current income.
(icon of) scale of globes
IDS Global Bond Fund
Invests in a Portfolio comprised primarily of debt securities of U.S. and
foreign issuers to seek high total return through income and growth of capital.
(icon of) globe
Growth funds
Funds in this group seek capital growth, primarily from common stocks. They are
high risk mutual funds with a potential for high reward.
IDS Precious Metals Fund
Invests primarily in the securities of foreign or domestic companies that
explore for, mine and process or distribute gold and other precious metals. A
highly aggressive and speculative fund that seeks long-term growth of capital.
(icon of) cart of precious gems
IDS Discovery Fund
Invests in small- and medium-size, growth-oriented companies emphasizing
technological innovation and productivity enhancement. Buys and holds larger
growth-oriented stocks.
(icon of) ship
IDS Small Company Index Fund
Invests in all or a representative group of the equity securities comprising the
S&P SmallCap 600 Index, as it strives to provide long-term capital appreciation.
(icon of) building
IDS Strategy Aggressive Fund
Invests primarily in common stocks of companies that are selected for their
potential for above-average growth. Above-average means that their growth
potential is better, in the opinion of the portfolio's investment manager, than
the Standard & Poor's Corporation (S&P) 500 Stock Index.
(icon of) chess piece
IDS Research Opportunities Fund
Invests in a Portfolio comprised primarily of equity securities of companies
included in the S&P 500 Index that are believed to have strong growth potential.
The Portfolio is managed using a research methodology by the Research Department
of AEFC. Goal is long-term appreciation.
(icon of) magnifying glass
IDS Growth Fund
Invests in a Portfolio comprised primarily of companies that have above-average
potential for long-term growth as a result of new management, marketing
opportunities or technological superiority.
(icon of) trees
IDS New Dimensions Fund
Invests in a Portfolio comprised primarily of companies with significant growth
potential due to superiority in technology, marketing or management. The Fund
frequently changes its industry mix.
(icon of) dimension
IDS Progressive Fund
Invests primarily in undervalued common stocks. The Fund holds stocks for the
long term with the goal of capital growth.
(icon of) shooting star
Growth & income funds
These funds focus on securities of medium to large, well-established companies
that offer long-term growth of capital and reasonable income from dividends and
interest. Foreign investments may be subject to currency fluctuations and
political and economic risks of the countries in which the investments are made.
IDS Equity Select Fund
Invests primarily in a combination of moderate growth stocks, higher-yielding
equities and bonds. Seeks growth of capital and income.
(icon of) three pine trees
IDS Blue Chip Advantage Fund
Invests in selected stocks from a major market index. Securities purchased are
those recommended by our research analysts as the best from each industry
represented on the index. Offers potential for long-term growth as well as
dividend income.
(icon of) ribbon
IDS Managed Allocation Fund
Invests in a Portfolio comprised primarily of U.S. equity securities, U.S. and
foreign debt securities, foreign equity securities and money market instruments.
The Fund provides diversification among these major investment categories and
has a target mix that represents the way the Fund's investments will be
allocated over the long term. Seeks maximum total return.
(icon of) gyroscope
IDS Stock Fund
Invests in a Portfolio comprised primarily of common stock of companies
representing many sectors of the economy. Seeks current income and growth of
capital.
(icon of) building with columns
IDS Equity Value Fund
Invests primarily in undervalued common stocks that offer potential for growth
of capital and income.
(icon of) three growing flowers
IDS Utilities Income Fund
Invests primarily in the stocks of public utility companies to seek high current
income and growth of income and capital with reduced volatility.
(icon of) light bulb
IDS Diversified Equity Income Fund
Invests in a Portfolio comprised primarily in high-yielding common stocks to
seek high current income and, secondarily, to benefit from the growth potential
offered by stock investments.
(icon of) two puzzle pieces
IDS Mutual
Invests in a Portfolio which seeks to balance between common stocks and senior
securities (preferred stocks and bonds). Seeks a balance of growth of capital
and current income.
(icon of) scale of justice
Income funds
The funds in this group invest their assets primarily in corporate bonds or
government securities to seek interest income. Secondary objective is capital
growth. Risk varies by bond quality.
IDS Extra Income Fund
Invests in a Portfolio comprised mainly of long-term, high-yielding corporate
fixed-income securities in the lower rated, higher risk bond categories to seek
high current income. Secondary objective is capital growth.
(icon of) two coins
IDS Bond Fund
Invests mainly in corporate bonds, at least 50% in the higher rated, lower risk
bond categories, or the equivalent, and in government bonds.
(icon of) Greek column
IDS Selective Fund
Invests in a Portfolio comprised primarily of high-quality corporate bonds and
other highly rated debt instruments including government securities and
short-term investments. Seeks current income and preservation of capital.
(icon of) skyline
IDS Federal Income Fund
Invests in a Portfolio comprised primarily of securities issued or guaranteed as
to the timely payment of principal and interest by the U.S. government, its
agencies and instrumentalities. Seeks a high level of current income and safety
of principal consistent with its type of investments.
(icon of) shield with eagle head
Tax-exempt income funds
These funds provide tax-free income by investing in municipal bonds. The income
is generally free from federal income tax, but a portion of the income may be
subject to state and local taxes. Risk varies by bond quality.
IDS Tax-Exempt Bond Fund
Invests mainly in bonds and notes of state or local government units, with at
least 75% in the four highest rated, lowest risk bond categories.
(icon of) shield with Greek column
IDS Insured Tax-Exempt Fund
Invests primarily in municipal securities that are insured as to the timely
payment of principal and interest. The insurance feature minimizes credit risk
of the Fund but does not guarantee the market value of the Fund's shares.
(icon of) shield with star
IDS State Tax-Exempt Funds
(CA, MA, MI, MN, NY, OH)
Invests primarily in high- and medium-grade municipal securities to provide
income to residents of each respective state that is exempt from federal, state
and local income taxes. (New York is the only state that is exempt at the local
level.)
(icon of) shield with U.S. enclosed
IDS High Yield Tax-Exempt Fund
Invests in a Portfolio comprised primarily of medium- and lower-quality
municipal bonds and notes. Lower-quality securities generally involve greater
risk of principal and income.
(icon of) shield with basket of apples enclosed
IDS Intermediate Tax-Exempt Fund
Invests in mainly investment-grade bonds and other debt securities with
intermediate-term maturities issued by state and local government units. Goal is
to seek a high level of current income exempt from federal taxes.
(icon of) shield with tree enclosed
Money market funds
These money market funds have three main goals: conservation of capital,
constant liquidity and the highest possible current income consistent with these
objectives. An investment in these funds is neither insured nor guaranteed by
the U.S. government, and there can be no assurance that these funds will be able
to maintain a stable net asset value of $1.00 per share. Very limited risk.
IDS Cash Management Fund
Invests in such money market securities as high quality commercial paper,
bankers' acceptances, certificates of deposit (CDs) and other bank securities.
(icon of) piggy bank
IDS Tax-Free Money Fund
Invests primarily in short-term bonds and notes issued by state and local
governments to seek high current income exempt from federal income taxes.
(icon of) shield with piggy bank enclosed
For more complete information about any of these funds, including charges and
expenses, you can obtain a prospectus by contacting your financial advisor or
writing to American Express Shareholder Service, P.O. Box 534, Minneapolis, MN
55440-0534. Read it carefully before you invest or send money.
<PAGE>
Quick telephone reference
American Express Redemptions and exchanges, National/Minnesota
Financial Advisors dividend payments or 800-437-3133
Telephone Transaction reinvestments and automatic
Service payment arrangements Mpls./St. Paul area:
671-3800
TTY Service For the hearing impaired 800-846-4852
American Express Automated account information 800-862-7919
Financial Advisors (TouchTone(R) phones only),
Easy Access Line including current fund prices
and performance, account values
and recent account transactions
<PAGE>
AMERICAN EXPRESS Financial Advisors
IDS Discovery Fund
IDS Tower 10
Minneapolis, MN 55440-0010
