<PAGE> 1
NATIONWIDE(R) MULTI-FLEX ANNUITY
Semi-Annual Report
June 30, 1999
Nationwide(R) LOGO
Multi-Flex Nationwide is on your side
Variable Account Columbus, Ohio
<PAGE> 2
[LOGO]
NATIONWIDE LIFE INSURANCE COMPANY
ONE NATIONWIDE PLAZA, COLUMBUS, OHIO 43215-2220
[President Photo]
PRESIDENT'S MESSAGE
On behalf of Nationwide Life Insurance Company, we are pleased to present the
1999 semi-annual report of the Nationwide Multi-Flex Variable Account.
Equity investments performed well during the first half of 1999 with the major
market indices showing double-digit gains. Fixed income investments did not fare
as well during this period in the face of the Federal Reserve's inflation
cautiousness. The Fed is mindful of the resilient U.S. economy and the
increasingly tight labor pool that portends future wage inflation. Accordingly,
we have seen a ratcheting-up of short-term interest rates to dampen the momentum
of the current expansion. How aggressively the Fed may react to the perceived
inflation threat only adds uncertainty to the already jittery equity markets.
Over the long term, however, a slower but sustainable rate of growth, with low
inflation, provides a favorable environment for further advances in financial
assets.
At mid-year, we are pleased to report that all the mission-critical systems used
to service our variable annuity and variable life business have been internally
inventoried, assessed and tested as being Year 2000 complaint. We are currently
contacting our critical business partners to determine if they will be Year 2000
compliant. Contingency plans are being developed and are to be completed by the
end of the third quarter. All these steps are being taken to assure that
Nationwide Financial will be able to continue to serve your financial needs into
the Year 2000 and beyond.
Thank you for selecting Nationwide Financial to help you achieve your financial
planning and retirement savings goals. You have our commitment to provide the
consistent, high quality service you expect and deserve.
/s/Joseph J. Gasper
Joseph J. Gasper, President
August 19, 1999
2
<PAGE> 3
NATIONWIDE MULTI-FLEX VARIABLE ACCOUNT
STATEMENT OF ASSETS,LIABILITIES AND CONTRACT OWNERS' EQUITY
June 30,1999
(UNAUDITED)
<TABLE>
<CAPTION>
Assets:
<S> <C>
Investments at market value:
AIM VI - Capital Appreciation Fund (AIMCapAp)
62,832 shares (cost $1,522,541) ....................................... $ 1,734,156
AIM VI - International Equity Fund (AIMIntEq)
6,518 shares (cost $125,235) .......................................... 133,552
American Century VP - American Century VP Advantage (ACVPAdv)
1,552,086 shares (cost $9,153,301) ................................... 9,908,780
American Century VP - American Century VP Capital Appreciation (ACVPCapAp)
2,374,860 shares (cost $23,900,744) .................................. 24,864,783
American Century VP - American Century VP Income & Growth (ACVPIncGr)
1,091,926 shares (cost $7,045,718) ................................... 8,123,930
The Dreyfus Socially Responsible Growth Fund, Inc.(DrySRGro)
1,432,049 shares (cost $36,658,731) .................................. 50,193,334
Dreyfus Stock Index Fund (DryStkIx)
3,172,691 shares (cost $76,745,727) .................................. 114,565,858
Dreyfus VIF - Capital Appreciation Portfolio (DryCapAp)
304,813 shares (cost $10,714,148) .................................... 11,832,850
Dreyfus VIF - Quality Bond Portfolio (DryQualBd)
592,014 shares (cost $6,889,598) ..................................... 6,559,517
Dreyfus VIF - Small Cap Portfolio (DrySmCap)
1,297,060 shares (cost $69,135,987) .................................. 78,498,068
Fidelity VIP - Equity-Income Portfolio (FidVIPEI)
5,763,729 shares (cost $114,532,030) ................................. 157,061,605
Fidelity VIP - High Income Portfolio (FidVIPHI)
2,316,889 shares (cost $28,116,214) .................................. 26,157,681
Janus AS - Janus Aspen International Growth Portfolio (JanASIntGr)
259,127 shares (cost $5,601,724) ..................................... 6,050,626
Nationwide SAT - Capital Appreciation Fund (NSATCapAp)
2,189,945 shares (cost $37,051,226) .................................. 64,997,558
Nationwide SAT - Government Bond Fund (NSATGvtBd)
8,235,640 shares (cost $92,047,635) .................................. 91,662,677
Nationwide SAT - High Income Bond Fund (NSATHIncBd)
35,800 shares (cost $363,676) ........................................ 354,780
</TABLE>
(Continued)
3
<PAGE> 4
<TABLE>
<CAPTION>
<S> <C>
Nationwide SAT - Money Market Fund (NSATMyMkt)
37,298,341 shares (cost $37,298,341) ................................. 37,298,341
Nationwide SAT - Total Return Fund (NSATTotRe)
24,956,581 shares (cost $293,254,092) ................................ 506,369,021
Neuberger &Berman AMT - Balanced Portfolio (NBAMTBal)
2,656,948 shares (cost $40,891,819) .................................. 42,458,027
Strong Opportunity Fund II, Inc.(StOpp2)
1,237,971 shares (cost $24,981,633) .................................. 28,547,618
Templeton VPS - Templeton International Fund - Class I (TemIntFd)
1,881,123 shares (cost $34,745,563) .................................. 37,340,282
--------------
Total investments ................................................. 1,304,713,044
Accounts receivable ....................................................... 106,862
--------------
Total assets....................................................... 1,304,819,906
--------------
Contract owners' equity (note 4) ............................................. $ 1,304,819,906
==============
</TABLE>
See accompanying notes to financial statements.
4
<PAGE> 5
NATIONWIDE MULTI-FLEX VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS'EQUITY
Six Month Periods Ended June 30,1999 and 1998
(UNAUDITED)
<TABLE>
<CAPTION>
Total AIMCapAp
-------------------------------- --------------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 12,864,586 13,566,618 -- --
Mortality, expense and administration
charges (note 2) ............................. (8,232,771) (8,392,402) (8,657) (1,800)
------------- ------------- ------------ ------------
Net investment activity ...................... 4,631,815 5,174,216 (8,657) (1,800)
------------- ------------- ------------ ------------
Proceeds from mutual fund shares sold ........... 127,853,175 142,583,680 103,129 9,185
Cost of mutual fund shares sold ................. (84,544,417) (81,280,249) (87,027) (8,566)
------------- ------------- ------------ ------------
Realized gain (loss) on investments .......... 43,308,758 61,303,431 16,102 619
Change in unrealized gain (loss) on investments . 48,140,277 52,140,387 133,695 28,371
------------- ------------- ------------ ------------
Net gain (loss) on investments ............... 91,449,035 113,443,818 149,797 28,990
------------- ------------- ------------ ------------
Reinvested capital gains ........................ 13,473,338 20,209,671 -- --
------------- ------------- ------------ ------------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 109,554,188 138,827,705 141,140 27,190
------------- ------------- ------------ ------------
Equity transactions:
Purchase payments received from
contract owners .............................. 68,051,262 98,523,648 254,340 239,839
Transfers between funds ......................... -- -- 570,423 229,416
Redemptions ..................................... (129,390,855) (160,355,817) (131,761) (9,017)
Annuity benefits ................................ (67,293) (54,214) -- --
Annual contract maintenance charge (note 2) ..... (1,017,289) (1,055,163) (1,740) (160)
Contingent deferred sales charges (note 2) ...... (532,043) (547,300) (426) --
Adjustments to maintain reserves ................ (495,521) (26,620) (9) (2)
------------- ------------- ------------ ------------
Net equity transactions .................... (63,451,738) (63,515,466) 690,827 460,076
------------- ------------- ------------ ------------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 46,102,450 75,312,239 831,967 487,266
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 1,258,717,456 1,220,486,706 902,179 25,570
------------- ------------- ------------ ------------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $ 1,304,819,906 1,295,798,945 1,734,146 512,836
============= ============= ============ ============
</TABLE>
<TABLE>
<CAPTION>
AIMIntEq ACVPAdv
-------------------------------- ------------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ -- -- 285,155 216,901
Mortality, expense and administration
charges (note 2) ............................. (906) (156) (64,886) (61,871)
------------ ----------- ----------- -----------
Net investment activity ...................... (906) (156) 220,269 155,030
------------ ----------- ----------- -----------
Proceeds from mutual fund shares sold ........... 76,101 4,205 1,709,815 955,648
Cost of mutual fund shares sold ................. (80,479) (3,868) (1,366,372) (789,120)
------------ ----------- ----------- -----------
Realized gain (loss) on investments .......... (4,378) 337 343,443 166,528
Change in unrealized gain (loss) on investments . 10,993 2,139 (930,541) (203,097)
------------ ----------- ----------- -----------
Net gain (loss) on investments ............... 6,615 2,476 (587,098) (36,569)
------------ ----------- ----------- -----------
Reinvested capital gains ........................ -- -- 676,891 816,147
------------ ----------- ----------- -----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 5,709 2,320 310,062 934,608
------------ ----------- ----------- -----------
Equity transactions:
Purchase payments received from
contract owners .............................. 30,459 19,981 309,724 320,438
Transfers between funds ......................... (29,116) 24,816 (12,549) (407,106)
Redemptions ..................................... (12,149) (1,814) (734,734) (639,275)
Annuity benefits ................................ -- -- (17) (7)
Annual contract maintenance charge (note 2) ..... (149) (3) (7,305) (8,347)
Contingent deferred sales charges (note 2) ...... (69) -- (5,199) (8,798)
Adjustments to maintain reserves ................ 5 (1) (509,134) 28
------------ ----------- ----------- -----------
Net equity transactions .................... (11,018) 42,979 (959,214) (743,067)
------------ ----------- ----------- -----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. (5,309) 45,299 (649,152) 191,541
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 138,862 5,859 10,557,958 10,004,517
------------ ----------- ----------- -----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $ 133,553 51,158 9,908,806 10,196,058
============ =========== =========== ===========
</TABLE>
(Continued)
5
<PAGE> 6
NATIONWIDE MULTI-FLEX VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS'EQUITY
Six Month Periods Ended June 30,1999 and 1998
(UNAUDITED)
<TABLE>
<CAPTION>
ACVPCapAp ACVPIncGr
--------------------------- ---------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ -- -- 1,352 1,023
Mortality, expense and administration
charges (note 2) ............................. (155,774) (197,247) (42,439) (7,787)
----------- ---------- ---------- ----------
Net investment activity ...................... (155,774) (197,247) (41,087) (6,764)
----------- ---------- ---------- ----------
Proceeds from mutual fund shares sold ........... 3,277,720 4,980,131 313,607 64,309
Cost of mutual fund shares sold ................. (3,221,652) (4,380,301) (236,040) (57,919)
----------- ---------- ---------- ----------
Realized gain (loss) on investments .......... 56,068 599,830 77,567 6,390
Change in unrealized gain (loss) on investments . 3,538,294 (1,736,030) 565,365 144,031
----------- ---------- ---------- ----------
Net gain (loss) on investments ............... 3,594,362 (1,136,200) 642,932 150,421
----------- ---------- ---------- ----------
Reinvested capital gains ........................ -- 1,515,406 -- 2,123
----------- ---------- ---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 3,438,588 181,959 601,845 145,780
----------- ---------- ---------- ----------
Equity transactions:
Purchase payments received from
contract owners .............................. 782,062 1,311,385 988,829 977,833
Transfers between funds ......................... (1,170,473) (3,793,925) 2,719,662 798,389
Redemptions ..................................... (2,555,252) (2,167,041) (620,997) (22,017)
Annuity benefits ................................ (559) (20) -- --
Annual contract maintenance charge (note 2) ..... (23,023) (30,227) (6,265) (517)
Contingent deferred sales charges (note 2) ...... (19,130) (34,175) (1,732) (102)
Adjustments to maintain reserves ................ 644 (243) (239) (42)
----------- ---------- ---------- ----------
Net equity transactions .................... (2,985,731) (4,714,246) 3,079,258 1,753,544
----------- ---------- ---------- ----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 452,857 (4,532,287) 3,681,103 1,899,324
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 24,412,586 32,331,863 4,442,594 216,859
----------- ---------- ---------- ----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $ 24,865,443 27,799,576 8,123,697 2,116,183
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
DrySRGro DryStkIx
---------------------------- ---------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ -- -- 589,105 464,672
Mortality, expense and administration
charges (note 2) ............................. (287,590) (166,922) (674,383) (431,919)
----------- ----------- ----------- ----------
Net investment activity ...................... (287,590) (166,922) (85,278) 32,753
----------- ----------- ----------- ----------
Proceeds from mutual fund shares sold ........... 839,149 166,307 1,640,570 415,155
Cost of mutual fund shares sold ................. (441,801) (92,048) (635,284) (215,152)
----------- ----------- ----------- ----------
Realized gain (loss) on investments .......... 397,348 74,259 1,005,286 200,003
Change in unrealized gain (loss) on investments . 4,940,561 4,178,533 9,864,408 9,601,495
----------- ----------- ----------- ----------
Net gain (loss) on investments ............... 5,337,909 4,252,792 10,869,694 9,801,498
----------- ----------- ----------- ----------
Reinvested capital gains ........................ -- -- 456,307 114,123
----------- ----------- ----------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 5,050,319 4,085,870 11,240,723 9,948,374
----------- ----------- ----------- ----------
Equity transactions:
Purchase payments received from
contract owners .............................. 4,759,641 5,803,612 9,352,834 10,583,718
Transfers between funds ......................... 4,869,897 686,355 8,549,495 4,280,853
Redemptions ..................................... (2,699,143) (683,219) (7,010,101) (2,550,346)
Annuity benefits ................................ -- -- (2,981) --
Annual contract maintenance charge (note 2) ..... (48,259) (32,538) (91,344) (64,922)
Contingent deferred sales charges (note 2) ...... (17,937) (8,774) (42,551) (35,444)
Adjustments to maintain reserves ................ 479 107 1,187 (12,096)
----------- ----------- ----------- ----------
Net equity transactions .................... 6,864,678 5,765,543 10,756,540 12,201,763
----------- ----------- ----------- ----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 11,914,997 9,851,413 21,997,263 22,150,137
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 38,278,833 20,780,931 92,569,778 54,561,165
----------- ----------- ----------- ----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $50,193,830 30,632,344 114,567,041 76,711,302
=========== =========== =========== ==========
</TABLE>
(Continued)
6
<PAGE> 7
NATIONWIDE MULTI-FLEX VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS'EQUITY
Six Month Periods Ended June 30,1999 and 1998
(UNAUDITED)
<TABLE>
<CAPTION>
DryCapAp DryQualBd
--------------------------- ---------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 536 56 148,955 130,933
Mortality, expense and administration
charges (note 2) ............................. (61,432) (4,264) (43,344) (34,091)
---------- ---------- ---------- ----------
Net investment activity ...................... (60,896) (4,208) 105,611 96,842
---------- ---------- ---------- ----------
Proceeds from mutual fund shares sold ........... 520,090 60,897 624,270 316,690
Cost of mutual fund shares sold ................. (437,306) (52,849) (624,049) (305,116)
---------- ---------- ---------- ----------
Realized gain (loss) on investments .......... 82,784 8,048 221 11,574
Change in unrealized gain (loss) on investments . 612,654 78,427 (243,956) 67,247
---------- ---------- ---------- ----------
Net gain (loss) on investments ............... 695,438 86,475 (243,735) 78,821
---------- ---------- ---------- ----------
Reinvested capital gains ........................ -- 186 -- --
---------- ---------- ---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 634,542 82,453 (138,124) 175,663
---------- ---------- ---------- ----------
Equity transactions:
Purchase payments received from
contract owners .............................. 1,504,761 717,004 792,426 1,028,428
Transfers between funds ......................... 4,518,776 827,549 (524,015) 160,607
Redemptions ..................................... (643,361) (58,023) (347,289) (284,339)
Annuity benefits ................................ -- -- -- --
Annual contract maintenance charge (note 2) ..... (7,790) (256) (7,607) (7,356)
Contingent deferred sales charges (note 2) ...... (3,742) (144) (2,683) (5,174)
Adjustments to maintain reserves ................ 83 (161) (83) 9
---------- ---------- ---------- ----------
Net equity transactions .................... 5,368,726 1,485,969 (89,251) 892,175
---------- ---------- ---------- ----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 6,003,268 1,568,422 (227,375) 1,067,838
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 5,829,653 33,181 6,786,814 4,704,446
---------- ---------- ---------- ----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $ 11,832,921 1,601,603 6,559,439 5,772,284
========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
DrySmCap FidVIPEI
-------------------------- ---------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 53,163 -- 2,194,168 1,767,643
Mortality, expense and administration
charges (note 2) ............................. (476,754) (458,099) (976,446) (900,381)
---------- ---------- ----------- -----------
Net investment activity ...................... (423,591) (458,099) 1,217,722 867,262
---------- ---------- ----------- -----------
Proceeds from mutual fund shares sold ........... 5,620,089 694,122 10,785,307 1,650,577
Cost of mutual fund shares sold ................. (4,190,779) (425,827) (6,490,109) (1,014,591)
---------- ---------- ----------- -----------
Realized gain (loss) on investments .......... 1,429,310 268,295 4,295,198 635,986
Change in unrealized gain (loss) on investments . 7,188,984 3,543,527 6,765,788 4,748,749
---------- ---------- ----------- -----------
Net gain (loss) on investments ............... 8,618,294 3,811,822 11,060,986 5,384,735
---------- ---------- ----------- -----------
Reinvested capital gains ........................ -- -- 4,850,267 6,290,729
---------- ---------- ----------- -----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 8,194,703 3,353,723 17,128,975 12,542,726
---------- ---------- ----------- -----------
Equity transactions:
Purchase payments received from
contract owners .............................. 8,570,389 13,486,824 9,415,274 14,216,728
Transfers between funds ......................... (6,548,656) (1,236,099) (6,285,099) 2,447,081
Redemptions ..................................... (4,826,577) (2,592,510) (10,833,064) (6,207,548)
Annuity benefits ................................ -- -- (966) (938)
Annual contract maintenance charge (note 2) ..... (103,105) (108,966) (121,694) (124,096)
Contingent deferred sales charges (note 2) ...... (47,509) (30,159) (88,599) (79,439)
Adjustments to maintain reserves ................ 732 (457) 1,360 38
---------- ---------- ----------- -----------
Net equity transactions .................... (2,954,726) 9,518,633 (7,912,788) 10,251,826
---------- ---------- ----------- -----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 5,239,977 12,872,356 9,216,187 22,794,552
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 73,258,807 62,649,484 147,846,675 124,247,535
---------- ---------- ----------- -----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $78,498,784 75,521,840 157,062,862 147,042,087
========== ========== =========== ===========
(Continued)
</TABLE>
7
<PAGE> 8
NATIONWIDE MULTI-FLEX VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS'EQUITY
Six Month Periods Ended June 30,1999 and 1998
(UNAUDITED)
<TABLE>
<CAPTION>
FidVIPHI JanASIntGr
----------------------------- ---------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 2,309,949 1,423,227 15,443 19,902
Mortality, expense and administration
charges (note 2) ............................. (168,713) (145,427) (31,920) (3,557)
----------- ---------- ---------- ----------
Net investment activity ...................... 2,141,236 1,277,800 (16,477) 16,345
----------- ---------- ---------- ----------
Proceeds from mutual fund shares sold ........... 2,264,840 197,840 198,797 37,431
Cost of mutual fund shares sold ................. (2,347,136) (161,258) (182,133) (35,421)
----------- ---------- ---------- ----------
Realized gain (loss) on investments .......... (82,296) 36,582 16,664 2,010
Change in unrealized gain (loss) on investments . (334,107) (1,401,948) 451,421 66,590
----------- ---------- ---------- ----------
Net gain (loss) on investments ............... (416,403) (1,365,366) 468,085 68,600
----------- ---------- ---------- ----------
Reinvested capital gains ........................ 86,353 904,342 -- 3,054
----------- ---------- ---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 1,811,186 816,776 451,608 87,999
----------- ---------- ---------- ----------
Equity transactions:
Purchase payments received from
contract owners .............................. 2,988,835 4,683,945 1,056,578 607,829
Transfers between funds ......................... (2,065,965) 617,851 1,191,062 656,472
Redemptions ..................................... (1,740,248) (597,484) (396,059) (32,240)
Annuity benefits ................................ -- -- -- --
Annual contract maintenance charge (note 2) ..... (30,542) (28,419) (4,360) (266)
Contingent deferred sales charges (note 2) ...... (12,396) (6,777) (3,360) (73)
Adjustments to maintain reserves ................ 82 34 41 (6)
----------- ---------- ---------- ----------
Net equity transactions .................... (860,234) 4,669,150 1,843,902 1,231,716
----------- ---------- ---------- ----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 950,952 5,485,926 2,295,510 1,319,715
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 25,206,813 19,319,305 3,755,155 30,802
----------- ---------- ---------- ----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $ 26,157,765 24,805,231 6,050,665 1,350,517
=========== ========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
NSATCapAp NSATGvtBd
---------------------------- -----------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 171,742 310,209 2,573,381 3,268,407
Mortality, expense and administration
charges (note 2) ............................. (403,612) (466,273) (645,845) (766,358)
---------- ---------- ----------- -----------
Net investment activity ...................... (231,870) (156,064) 1,927,536 2,502,049
---------- ---------- ----------- -----------
Proceeds from mutual fund shares sold ........... 7,766,184 13,710,694 14,666,986 18,129,129
Cost of mutual fund shares sold ................. (3,088,826) (5,967,140) (14,604,962) (17,645,903)
---------- ---------- ----------- -----------
Realized gain (loss) on investments .......... 4,677,358 7,743,554 62,024 483,226
Change in unrealized gain (loss) on investments . 2,182,493 4,660,825 (4,832,451) 811,067
---------- ---------- ----------- -----------
Net gain (loss) on investments ............... 6,859,851 12,404,379 (4,770,427) 1,294,293
---------- ---------- ----------- -----------
Reinvested capital gains ........................ -- -- -- --
---------- ---------- ----------- -----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 6,627,981 12,248,315 (2,842,891) 3,796,342
---------- ---------- ----------- -----------
Equity transactions:
Purchase payments received from
contract owners .............................. 1,989,176 2,886,468 2,681,739 3,226,460
Transfers between funds ......................... 2,616,032 1,900,296 (2,730,113) (2,123,162)
Redemptions ..................................... (8,606,946) (15,395,367) (12,692,793) (17,159,325)
Annuity benefits ................................ (3,166) (2,736) (7,598) (9,537)
Annual contract maintenance charge (note 2) ..... (36,422) (41,388) (69,876) (82,557)
Contingent deferred sales charges (note 2) ...... (13,924) (21,030) (41,825) (60,898)
Adjustments to maintain reserves ................ 454 501 (228) (5,758)
---------- ---------- ----------- -----------
Net equity transactions .................... (4,054,795) (10,673,256) (12,860,694) (16,214,777)
---------- ---------- ----------- -----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 2,573,186 1,575,059 (15,703,585) (12,418,435)
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 62,424,782 67,645,086 107,365,814 122,839,668
---------- ---------- ----------- -----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $64,997,968 69,220,145 91,662,229 110,421,233
========== ========== =========== ===========
</TABLE>
8
<PAGE> 9
NATIONWIDE MULTI-FLEX VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS'EQUITY
Six Month Periods Ended June 30,1999 and 1998
(UNAUDITED)
<TABLE>
<CAPTION>
NSATHIncBd NSATMyMkt
---------------------------- ----------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 13,454 3,377 885,766 1,052,272
Mortality, expense and administration
charges (note 2) ............................. (2,205) (610) (252,822) (263,507)
----------- ----------- ----------- -----------
Net investment activity ...................... 11,249 2,767 632,944 788,765
----------- ----------- ----------- -----------
Proceeds from mutual fund shares sold ........... 182,845 50,543 12,230,079 12,319,703
Cost of mutual fund shares sold ................. (176,189) (49,728) (12,230,079) (12,319,703)
----------- ----------- ----------- -----------
Realized gain (loss) on investments .......... 6,656 815 -- --
Change in unrealized gain (loss) on investments . (12,681) (1,156) -- --
----------- ----------- ----------- -----------
Net gain (loss) on investments ............... (6,025) (341) -- --
----------- ----------- ----------- -----------
Reinvested capital gains ........................ 176 -- -- --
----------- ----------- ----------- -----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 5,400 2,426 632,944 788,765
----------- ----------- ----------- -----------
Equity transactions:
Purchase payments received from
contract owners .............................. 73,751 101,412 1,162,331 5,205,654
Transfers between funds ......................... 16,403 46,487 4,438,164 (3,200,882)
Redemptions ..................................... (30,934) (2,262) (7,472,706) (7,044,679)
Annuity benefits ................................ -- -- (1,967) (2,243)
Annual contract maintenance charge (note 2) ..... (436) (55) (29,730) (33,933)
Contingent deferred sales charges (note 2) ...... (14) -- (25,141) (45,315)
Adjustments to maintain reserves ................ 1 -- (217) 4,435
----------- ----------- ----------- -----------
Net equity transactions .................... 58,771 145,582 (1,929,266) (5,116,963)
----------- ----------- ----------- -----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 64,171 148,008 (1,296,322) (4,328,198)
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 290,615 2,848 38,688,503 42,366,073
----------- ----------- ----------- -----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $ 354,786 150,856 37,392,181 38,037,875
=========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
NSATTotRe NBAMTBal
----------------------------- ----------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ 1,932,917 3,154,100 728,530 1,016,529
Mortality, expense and administration
charges (note 2) ............................. (3,258,543) (3,856,486) (278,908) (291,183)
------------ ------------ ----------- -----------
Net investment activity ...................... (1,325,626) (702,386) 449,622 725,346
------------ ------------ ----------- -----------
Proceeds from mutual fund shares sold ........... 57,530,908 85,307,544 3,858,510 1,719,595
Cost of mutual fund shares sold ................. (27,891,046) (35,018,554) (3,576,706) (1,531,752)
------------ ------------ ----------- -----------
Realized gain (loss) on investments .......... 29,639,862 50,288,990 281,804 187,843
Change in unrealized gain (loss) on investments . 19,365,724 29,729,715 (1,224,853) (3,798,103)
------------ ------------ ----------- -----------
Net gain (loss) on investments ............... 49,005,586 80,018,705 (943,049) (3,610,260)
------------ ------------ ----------- -----------
Reinvested capital gains ........................ 227,621 -- 1,079,303 7,139,906
------------ ------------ ----------- -----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 47,907,581 79,316,319 585,876 4,254,992
------------ ------------ ----------- -----------
Equity transactions:
Purchase payments received from
contract owners .............................. 13,291,912 20,884,005 1,510,329 2,397,749
Transfers between funds ......................... (5,759,718) 386,785 (1,190,923) (759,457)
Redemptions ..................................... (60,472,695) (100,865,645) (3,526,802) (1,966,543)
Annuity benefits ................................ (49,935) (38,717) (106) (16)
Annual contract maintenance charge (note 2) ..... (333,077) (398,663) (32,539) (34,556)
Contingent deferred sales charges (note 2) ...... (138,412) (154,222) (30,681) (35,890)
Adjustments to maintain reserves ................ 8,473 (13,294) 163 56
------------ ------------ ----------- -----------
Net equity transactions .................... (53,453,452) (80,199,751) (3,270,561) (398,657)
------------ ------------ ----------- -----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. (5,545,871) (883,432) (2,684,685) 3,856,335
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 511,922,904 571,309,010 45,142,869 43,044,453
------------ ------------ ----------- -----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $ 506,377,033 570,425,578 42,458,184 46,900,788
============ ============ =========== ===========
</TABLE>
(Continued)
9
<PAGE> 10
NATIONWIDE MULTI-FLEX VARIABLE ACCOUNT
STATEMENTS OF OPERATIONS AND CHANGES
IN CONTRACT OWNERS'EQUITY
Six Month Periods Ended June 30,1999 and 1998
(UNAUDITED)
<TABLE>
<CAPTION>
StOpp2 TemIntFd
----------------------------- ----------------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Investment activity:
Reinvested dividends ............................ $ -- 5,741 960,970 731,626
Mortality, expense and administration
charges (note 2) ............................. (165,843) (114,680) (231,749) (219,784)
----------- ---------- ---------- ----------
Net investment activity ...................... (165,843) (108,939) 729,221 511,842
----------- ---------- ---------- ----------
Proceeds from mutual fund shares sold ........... 1,052,082 304,002 2,592,097 1,489,973
Cost of mutual fund shares sold ................. (844,756) (233,879) (1,791,686) (971,554)
----------- ---------- ---------- ----------
Realized gain (loss) on investments .......... 207,326 70,123 800,411 518,419
Change in unrealized gain (loss) on investments . 1,688,185 (120,062) (1,589,699) 1,740,067
----------- ---------- ---------- ----------
Net gain (loss) on investments ............... 1,895,511 (49,939) (789,288) 2,258,486
----------- ---------- ---------- ----------
Reinvested capital gains ........................ 2,758,314 2,115,597 3,338,106 1,308,058
----------- ---------- ---------- ----------
Net increase (decrease) in contract owners'
equity resulting from operations ........ 4,487,982 1,956,719 3,278,039 4,078,386
----------- ---------- ---------- ----------
Equity transactions:
Purchase payments received from
contract owners .............................. 2,919,862 4,062,838 3,616,009 5,761,498
Transfers between funds ......................... (245,566) 298,598 (2,927,718) (1,840,924)
Redemptions ..................................... (1,927,458) (424,950) (2,109,787) (1,652,173)
Annuity benefits ................................ -- -- -- --
Annual contract maintenance charge (note 2) ..... (30,222) (21,890) (31,802) (36,048)
Contingent deferred sales charges (note 2) ...... (16,627) (4,419) (20,086) (16,467)
Adjustments to maintain reserves ................ 422 51 264 181
----------- ---------- ---------- ----------
Net equity transactions .................... 700,410 3,910,228 (1,473,120) 2,216,067
----------- ---------- ---------- ----------
NET CHANGE IN CONTRACT OWNERS'EQUITY .............. 5,188,392 5,866,947 1,804,919 6,294,453
CONTRACT OWNERS'EQUITY BEGINNING OF PERIOD ........ 23,359,647 14,499,894 35,535,615 29,868,157
----------- ---------- ---------- ----------
CONTRACT OWNERS'EQUITY END OF PERIOD .............. $ 28,548,039 20,366,841 37,340,534 36,162,610
=========== ========== ========== ==========
</TABLE>
See accompanying notes to financial statements.
10
<PAGE> 11
NATIONWIDE MULTI-FLEX VARIABLE ACCOUNT
NOTES TO FINANCIAL STATEMENTS
June 30,1999 and 1998
(UNAUDITED)
(1) Summary of Significant Accounting Policies
(a) Organization and Nature of Operations
The Nationwide Multi-Flex Variable Account (the Account) was
established pursuant to a resolution of the Board of Directors of
Nationwide Life Insurance Company (the Company) on October 7, 1981.
The Account has been registered as a unit investment trust under the
Investment Company Act of 1940.On August 21, 1991, the Company (the
Depositor) transferred to the Account 50,000 shares of the American
Century VP - American Century VP Advantage fund for which the Account
was credited with 25,000 accumulation units.The value of the
accumulation units purchased by the Company on August 21, 1991 was
$250,000.
The Company offers tax qualified and non-tax qualified Individual
Deferred Variable Annuity Contracts through the Account.The primary
distributions for the contracts is through Company Agents and an
affiliated sales organization;however, other distributors may be
utilized.
(b) The Contracts
Only contracts without a front-end sales charge, but with a contingent
deferred sales charge and certain other fees, are offered for
purchase.See note 2 for a discussion of contract expenses.With certain
exceptions, contract owners in either the accumulation or payout phase
may invest in any of the following:
Funds of the AIM Variable Insurance Funds, Inc.(AIM VI);
AIM VI - Capital Appreciation Fund (AIMCapAp)(*)
AIM VI - International Equity Fund (AIMIntEq)(*)
Portfolios of the American Century Variable Portfolios, Inc.(American
Century VP);
American Century VP - American Century VP Advantage (ACVPAdv)(*)
American Century VP - American Century VP Capital Appreciation
(ACVPCapAp)(*)
American Century VP - American Century VP Income & Growth
(ACVPIncGr)(*)
The Dreyfus Socially Responsible Growth Fund, Inc.(DrySRGro)(*)
Dreyfus Stock Index Fund (DryStkIx)(*)
Portfolios of the Dreyfus Variable Investment Fund (Dreyfus VIF);
Dreyfus VIF - Capital Appreciation Portfolio (DryCapAp)(*)
Dreyfus VIF - Quality Bond Portfolio (DryQualBd)(*)
Dreyfus VIF - Small Cap Portfolio (DrySmCap)(*)
Portfolios of the Fidelity Variable Insurance Products Fund (Fidelity
VIP);
Fidelity VIP - Equity-Income Portfolio (FidVIPEI)(*)
Fidelity VIP - High Income Portfolio (FidVIPHI)(*)
Portfolio of the Janus Aspen Series (Janus AS);
Janus AS - Janus Aspen International Growth Portfolio
(JanASIntGr)(*)
Funds of the Nationwide Separate Account Trust (Nationwide SAT)
(managed for a fee by an affiliated investment advisor);
Nationwide SAT - Capital Appreciation Fund (NSATCapAp)
(not available to contracts established under NEA Valuebuilder)
Nationwide SAT - Government Bond Fund (NSATGvtBd)
Nationwide SAT - High Income Bond Fund (NSATHIncBd)(*)
Nationwide SAT - Money Market Fund (NSATMyMkt)
Nationwide SAT - Total Return Fund (NSATTotRe)
11
<PAGE> 12
Portfolio of the Neuberger & Berman Advisers Management Trust
(Neuberger &Berman AMT);
Neuberger & Berman AMT - Balanced Portfolio (NBAMTBal)(*)
Strong Opportunity Fund II, Inc.(StOpp2)(*)
Portfolio of the Templeton Variable Products Series Fund (Templeton
VPS);
Templeton VPS - Templeton International Fund - Class I (TemIntFd)(*)
At June 30, 1999, contract owners have invested in all of the above
funds.The contract owners' equity is affected by the investment
results of each fund, equity transactions by contract owners and
certain contract expenses (see note 2). The accompanying financial
statements include only contract owners' purchase payments pertaining
to the variable portions of their contracts and exclude any purchase
payments for fixed dollar benefits, the latter being included in the
accounts of the Company.
A contract owner may choose from among a number of different
underlying mutual fund options.The underlying mutual fund options are
not available to the general public directly.The underlying mutual
funds are available as investment options in variable life insurance
policies or variable annuity contracts issued by life insurance
companies or, in some cases, through participation in certain
qualified pension or retirement plans.
Some of the underlying mutual funds have been established by
investment advisers which manage publicly traded mutual funds having
similar names and investment objectives.While some of the underlying
mutual funds may be similar to, and may in fact be modeled after,
publicly traded mutual funds, the underlying mutual funds are not
otherwise directly related to any publicly traded mutual fund.Con-
sequently, the investment performance of publicly traded mutual funds
and any corresponding underlying mutual funds may differ
substantially.
(c) Security Valuation, Transactions and Related Investment Income
The market value of the underlying mutual funds is based on the
closing net asset value per share at June 30, 1999.The cost of
investments sold is determined on a specific identification
basis.Investment transactions are accounted for on the trade date
(date the order to buy or sell is executed) and dividend income is
recorded on the ex-dividend date.
(d) Federal Income Taxes
Operations of the Account form a part of, and are taxed with,
operations of the Company which is taxed as a life insurance company
under the Internal Revenue Code.
The Company does not provide for income taxes within the Account.
Taxes are the responsibility of the contract owner upon termination or
withdrawal.
(e) Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles may require management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities,
if any, at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
(2) Expenses
The Company does not deduct a sales charge from purchase payments received
from the contract owners. However, if any part of the contract value of
such contracts is surrendered, the Company will, with certain exceptions,
deduct from a contract owner's contract value a contingent deferred sales
charge. For contracts issued prior to February 1, 1989, the contingent
deferred sales charge will be equal to 5% of the lesser of the total of all
purchase payments made within 96 months prior to the date of the request
for surrender or the amount surrendered. For contracts issued on or after
February 1, 1989, the Company will deduct a contingent deferred sales
charge not to exceed 7% of the lesser of purchase payments or the amount
surrendered, such charge declining 1% per year, to 0%, after the purchase
payment has been held in the contract for 84 months.No sales charges are
deducted on redemptions used to purchase units in the fixed investment
options of the Company.
12
<PAGE> 13
The following contract charges are deducted by the Company:(a) an annual
contract maintenance charge up to $30, dependent upon contract type and
issue date, which is satisfied by surrendering units;and (b) contracts
issued prior to February 1, 1989, a charge for mortality and expense risk
assessed through daily unit value calculation equal to an annual rate of
0.80% and 0.50%, respectively;for contracts issued or after February 1,
1989, a mortality risk charge, an expense risk charge and an administration
charge assessed through the daily unit value calculation equal to an annual
rate of 0.80%, 0.45% and 0.05%, respectively;for NEA Valuebuilder Annuity
contracts issued before November 3, 1997, or in states which have not
approved the applicable contract modifications, a mortality and expense
risk charge and an administrative charge assessed through the daily unit
value calculation equal to a annual rate of 1.25% and .05%, respectively;
for NEA Valuebuilder Annuity contracts issued on or after the later of
November 3, 1997, or the date which state insurance authorities approve
corresponding contract modifications, an actuarial risk charge assessed
through the daily unit value calculation equal to an annual rate of
1.30%.No charges were deducted from the initial funding, or from earnings
thereon.
(3) Related Party Transactions
The Company performs various services on behalf of the Mutual Fund
Companies in which the Account invests and may receive fees for the
services performed. These services include, among other things, share
holder communications, preparation, postage, fund transfer agency and
various other record keeping customer service functions. These fees are
paid to an affiliate of the Company.
(*) This fund is only available for contracts issued to Plans established under
the NEA Valuebuilder Annuity.
13
<PAGE> 14
(4) Components of Contract owners'equity
The following is a summary of contract owners'equity at June 30, 1999, for
each series, in both the accumulation and payout phases.
Contract owners' equity represented by:
<TABLE>
<CAPTION>
Unit Period
Contracts in accumulation phase: Units Value Return(*)
----- ----- ---------
<S> <C> <C> <C> <C>
AIM VI - Capital Appreciation Fund:
Tax qualified ............................................. 136,902 $ 12.170899 $ 1,666,220 9%
Non-tax qualified ......................................... 5,581 12.170899 67,926 9%
AIM VI - International Equity Fund:
Tax qualified ............................................. 11,390 11.725440 133,553 4%
American Century VP - American Century
VP Advantage:
Tax qualified ............................................. 389,954 18.663713 7,277,990 3%
Non-tax qualified ......................................... 140,946 18.663713 2,630,576 3%
American Century VP - American Century
VP Capital Appreciation:
Tax qualified ............................................. 1,084,400 16.516179 17,910,145 15%
Non-tax qualified ......................................... 420,441 16.516179 6,944,079 15%
American Century VP - American Century
VP Income & Growth:
Tax qualified ............................................. 545,493 14.206441 7,749,514 9%
Non-tax qualified ......................................... 26,339 14.206441 374,183 9%
The Dreyfus Socially Responsible
Growth Fund, Inc.:
Tax qualified ............................................. 1,652,964 28.936182 47,830,467 12%
Non-tax qualified ......................................... 81,675 28.936182 2,363,363 12%
Dreyfus Stock Index Fund:
Tax qualified ............................................. 3,181,256 30.896018 98,288,143 11%
Non-tax qualified ......................................... 526,534 30.896018 16,267,804 11%
Dreyfus VIF - Capital Appreciation Portfolio:
Tax qualified ............................................. 800,941 14.063906 11,264,359 7%
Non-tax qualified ......................................... 40,427 14.063906 568,562 7%
Dreyfus VIF - Quality Bond Portfolio:
Tax qualified ............................................. 526,725 11.755879 6,192,115 (2)%
Non-tax qualified ......................................... 31,246 11.755879 367,324 (2)%
Dreyfus VIF - Small Cap Portfolio:
Tax qualified ............................................. 4,069,173 18.687864 76,044,152 12%
Non-tax qualified ......................................... 131,349 18.687864 2,454,632 12%
Fidelity VIP - Equity-Income Portfolio:
Tax qualified ............................................. 5,156,113 25.356511 130,741,036 12%
Non-tax qualified ......................................... 1,037,842 25.356511 26,316,052 12%
Fidelity VIP - High Income Portfolio:
Tax qualified ............................................. 1,601,423 15.594567 24,973,498 7%
Non-tax qualified ......................................... 75,941 15.594567 1,184,267 7%
Janus AS - Janus Aspen
International Growth Portfolio:
Tax qualified ............................................. 464,179 12.592749 5,845,290 9%
Non-tax qualified ......................................... 16,309 12.592749 205,375 9%
Nationwide SAT - Capital Appreciation Fund:
Tax qualified ............................................. 1,386,857 34.047394 47,218,867 11%
Non-tax qualified ......................................... 520,274 34.047394 17,713,974 11%
</TABLE>
14
<PAGE> 15
<TABLE>
<CAPTION>
Unit Period
Units Value Return(*)
----- ----- ---------
<S> <C> <C> <C> <C>
Nationwide SAT - Government Bond Fund:
Tax qualified ............................................. 1,942,885 34.029647 66,115,691 (3)%
Non-tax qualified ......................................... 747,452 34.042202 25,444,912 (3)%
Nationwide SAT - High Income Bond Fund:
Tax qualified .............................................. 30,899 10.879685 336,171 2%
Non-tax qualified ......................................... 1,711 10.879685 18,615 2%
Nationwide SAT - Money Market Fund:
Tax qualified ............................................. 1,274,672 22.303916 28,430,177 2%
Non-tax qualified ......................................... 369,010 24.233606 8,942,443 2%
Nationwide SAT - Total Return Fund:
Tax qualified ............................................. 3,725,974 101.844530 379,470,071 10%
Non-tax qualified ......................................... 1,277,677 98.915179 126,381,649 10%
Neuberger &Berman AMT - Balanced Portfolio:
Tax qualified ............................................. 1,583,202 20.622941 32,650,281 2%
Non-tax qualified ......................................... 475,489 20.622941 9,805,982 2%
Strong Opportunity Fund II, Inc.:
Tax qualified ............................................. 1,352,712 20.122292 27,219,666 19%
Non-tax qualified ......................................... 66,015 20.122292 1,328,373 19%
Templeton VPS - Templeton International Fund:
Tax qualified ............................................. 1,957,211 18.443987 36,098,774 10%
Non-tax qualified ......................................... 67,326 18.443987 1,241,760 10%
========== ==========
Reserves for annuity contracts in payout phase:
Tax qualified ........................................ 463,251
Non-tax qualified .................................... 278,624
-------------
$ 1,304,819,906
=============
</TABLE>
(*) The period return does not include contract charges satisfied by
surrendering units.
15
<PAGE> 16
NATIONWIDE LIFE INSURANCE COMPANY
HOME OFFICE: ONE NATIONWIDE PLAZA
COLUMBUS, OHIO 43215-2220 Bulk Rate
U.S.Postage
PAID
Columbus, Ohio
Permit No.521
Nationwide(R) is a registered federal service mark of Nationwide Mutual
Insurance Company
