PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
SEMI-ANNUAL REPORT FOR THE SIX MONTHS ENDED JULY 31, 1996
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
July 31, 1996
(Unaudited)
ASSETS AND LIABILITIES
ASSETS
Investments at market value (Notes 1, 2, 4 & 5):
Investments other than securities:
Gold assets ..............................................................
Silver assets ............................................................
Swiss franc deposits .....................................................
Swiss franc bonds ...........................................................
Stocks of United States and foreign real estate and natural resource companies
Aggressive growth stock investments .........................................
Investment in an affiliate ..................................................
Corporate bonds .............................................................
United States Treasury securities ...........................................
Total investments (identified cost $70,411,796; $110,987,068; $19,612,923;
and $8,777,882, respectively)
Cash ..........................................................................
Accounts receivable for shares of the portfolio sold ..........................
Accounts receivable for investments sold ......................................
Accrued interest, dividends and foreign taxes receivable ......................
Due from investment adviser ....................................................
Total assets
LIABILITIES
Bank overdraft ................................................................
Accounts payable for shares of the portfolio redeemed .........................
Accounts payable for investments purchased ....................................
Accrued investment advisory fee ...............................................
Accrued directors' fees and expenses ..........................................
Accrued excise tax ............................................................
Total liabilities
Net assets applicable to outstanding shares
NET ASSETS
Capital stock - par value $.001 per share:
Authorized - 100,000,000; 100,000,000; 10,000,000; and 25,000,000 shares,
respectively
Outstanding - 4,010,545; 1,625,782; 329,102; and 286,141 shares,
respectively ..............................................................
Paid-in capital ...............................................................
Undistributed net investment income (Note 1) ..................................
Accumulated net realized gain (loss) on investments ...........................
Accumulated net realized gain on foreign currency transactions ................
Net unrealized appreciation (depreciation) of investments ......................
Net unrealized appreciation on translation of assets and liabilities in foreign
currencies ..................................................................
Net assets applicable to outstanding shares
Net asset value per share
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Permanent Portfolio Treasury Bill Portfolio Versatile Bond Portfolio Aggressive Growth Portfolio
------------------- ----------------------- ------------------------ ---------------------------
<C> <C> <C> <C>
$ 14,574,925 $ - $ - $ -
3,613,736 - - -
339,657 - - -
------------ ------------ ------------- ------------
18,528,318 - - -
7,430,586 - - -
10,686,225 - - -
11,341,467 - - 11,472,182
- - - -
1,722,849 - 18,370,893 -
23,071,022 110,982,626 1,239,284 -
------------ ------------ ------------- ------------
72,780,467 110,982,626 19,610,177 11,472,182
687,627 - 784,989 -
21,800 41,090 - 9,768
792,517 - - -
366,704 1,811,123 299,349 3,107
- 3,262 12,607 15,858
------------ ------------ ------------- ------------
74,649,115 112,838,101 20,707,122 11,500,915
- 69,354 - 5,204
29,148 98,726 27,524 -
1,101,063 - 1,620,080 -
5,914 - - -
869 1,268 318 27
49,728 87,021 12,432 2,089
------------ ------------ ------------- ------------
1,186,722 256,369 1,660,354 7,320
------------ ------------ ------------- ------------
$ 73,462,393 $112,581,732 $ 19,046,768 $ 11,493,595
============ ============ ============= ============
$ 4,011 $ 1,626 $ 329 $ 286
59,048,055 107,564,002 17,611,197 8,240,344
------------ ------------ ------------- ------------
59,052,066 107,565,628 17,611,526 8,240,630
7,800,928 5,038,808 1,565,520 206,018
3,844,019 (18,262) (127,532) 352,647
395,734 - - -
2,368,671 (4,442) (2,746) 2,694,300
975 - - -
------------ ------------ ------------- ------------
$ 73,462,393 $112,581,732 $ 19,046,768 $ 11,493,595
============ ============ ============= ============
$18.32 $69.25 $57.88 $40.17
====== ====== ====== ======
</TABLE>
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
STATEMENTS OF OPERATIONS
Six months ended July 31, 1996
(Unaudited)
Investment income:
Interest ....................................................................
Dividends ...................................................................
Expenses (Notes 3, 7, 8 & 9):
Investment advisory fee .....................................................
Directors' fees and expenses ................................................
Excise tax ..................................................................
Regulatory expense ..........................................................
Shareholder meeting expense .................................................
Total expenses
Less waiver of investment advisory fee expense ............................
Net expenses
Net investment income before foreign income taxes deducted at source
Less foreign income taxes deducted at source, net of refundable taxes .........
Net investment income
Realized and unrealized gain (loss) on investments and foreign currency
(Notes 1, 2, 4 & 5):
Net realized gain (loss) on:
Investments in unaffiliated issuers .........................................
Foreign currency transactions ...............................................
Change in unrealized appreciation (depreciation) of:
Investments .................................................................
Translation of assets and liabilities in foreign currencies .................
Net realized and unrealized loss on investments
and foreign currency
Net increase (decrease) in net assets resulting
from operations
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Permanent Portfolio Treasury Bill Portfolio Versatile Bond Portfolio Aggressive Growth Portfolio
------------------- ---------------------- ------------------------ ---------------------------
<C> <C> <C> <C>
$ 1,280,025 $ 2,852,392 $ 602,136 $ 3,558
423,482 - - 175,288
------------ ------------ ------------- ------------
1,703,507 2,852,392 602,136 178,846
423,792 637,912 108,864 67,472
6,255 9,352 1,597 996
49,728 87,021 12,432 2,089
18,280 15,152 1,010 769
15,804 6,348 1,319 1,132
------------ ------------ ------------- ------------
513,859 755,785 125,222 72,458
- 283,820 36,346 -
------------ ------------ ------------- ------------
513,859 471,965 88,876 72,458
------------ ------------ ------------- ------------
1,189,648 2,380,427 513,260 106,388
7,912 - - -
------------ ------------ ------------- ------------
1,181,736 2,380,427 513,260 106,388
------------ ------------ ------------- ------------
2,238,992 (1,183) 8,689 336,606
10,793 - - -
------------ ------------ ------------- ------------
2,249,785 (1,183) 8,689 336,606
(5,415,307) (63,399) (176,454) (648,196)
(7,743) - - -
------------ ------------ ------------- ------------
(3,173,265) (64,582) (167,765) (311,590)
------------ ------------ ------------- ------------
$ (1,991,529) $ 2,315,845 $ 345,495 $ (205,202)
============ ============ ============= ============
</TABLE>
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Permanent Portfolio
-----------------------------------
Six months ended Year ended
July 31, 1996 January 31, 1996
(Unaudited)
---------------- ----------------
<S> <C> <C>
Operations:
Net investment income (loss) .............................................. $ 1,181,736 $ 2,130,759
Net realized gain (loss) on investments ................................... 2,238,992 1,019,589
Net realized gain on foreign currency transactions ........................ 10,793 384,941
Change in unrealized appreciation (depreciation) of investments ........... (5,415,307) 7,555,020
Change in unrealized appreciation (depreciation) on translation of
assets and liabilities in foreign currencies ........................... (7,743) (19,075)
------------ ------------
Net increase (decrease) in net assets resulting from operations (1,991,529) 11,071,234
Equalization on shares issued and redeemed: ................................. (132,357) (467,059)
Distributions to shareholders from:
Net investment income ..................................................... - (1,517,212)
Net realized gain on investments .......................................... - -
Capital stock transactions exclusive of amounts allocated to undistributed
net investment income (Note 6): ........................................... (1,054,512) (4,055,817)
------------ ------------
Net increase (decrease) in net assets (3,178,398) 5,031,146
Net assets at beginning of period 76,640,791 71,609,645
------------ ------------
Net assets at end of period (including undistributed net investment income
of $7,800,928 and $6,927,153; $5,038,808 and $4,340,131; $1,565,520 and
$1,672,573; $206,018 and $97,512, respectively) $ 73,462,393 $ 76,640,791
============ ============
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Treasury Bill Portfolio Versatile Bond Portfolio Aggressive Growth Portfolio
- ------------------------------------ ----------------------------------- --------------------------------------
Six months ended Year ended Six months ended Year ended Six months ended Year ended
July 31, 1996 January 31, 1996 July 31, 1996 January 31, 1996 July 31, 1996 January 31, 1996
(Unaudited) (Unaudited) (Unaudited)
- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
<C> <C> <C> <C> <C> <C>
$ 2,380,427 $ 5,651,617 $ 513,260 $ 1,132,191 $ 106,388 $ (5,087)
(1,183) (4,256) 8,689 (1,737) 336,606 104,190
- - - - - -
(63,399) 68,077 (176,454) 397,527 (648,196) 2,236,677
- - - - - -
------------ ------------- ------------ ------------ ----------- -----------
2,315,845 5,715,438 345,495 1,527,981 (205,202) 2,335,780
(276,233) (832,446) (163,857) (396,154) 2,118 7,218
- (2,879,288) - (680,753) - (28,111)
- - - - - (385,888)
(4,125,195) (9,002,323) (1,272,037) (2,543,288) 630,096 2,380,042
------------ ------------- ------------ ------------ ----------- -----------
(2,085,583) (6,998,619) (1,090,399) (2,092,214) 427,012 4,309,041
114,667,315 121,665,934 20,137,167 22,229,381 11,066,583 6,757,542
------------ ------------- ------------ ------------ ----------- -----------
$112,581,732 $ 114,667,315 $ 19,046,768 $ 20,137,167 $11,493,595 $11,066,583
============ ============= ============ ============ =========== ===========
</TABLE>
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Quantity Market Value
- ----------------- ------------
<C> <S> <C>
GOLD ASSETS - 19.84% of Total Net Assets
11,997 Troy Oz. Gold bullion (a) ......................................................... $ 4,648,940
24,757 Coins One-ounce gold coins (a) .................................................. 9,859,475
4,297 Units United States Gold Trust (a)(c) ........................................... 66,510
------------
Total Gold Assets (Cost $14,918,799) $ 14,574,925
------------
SILVER ASSETS - 4.92% of Total Net Assets
446,824 Troy Oz. Silver bullion (a) ........................................................ $ 2,288,631
379 Bags Silver coins (a) .......................................................... 1,325,105
------------
Total Silver Assets (Cost $4,643,504) $ 3,613,736
------------
</TABLE>
<TABLE>
<CAPTION>
Principal Amount SWISS FRANC ASSETS - 10.58% of Total Net Assets
- ----------------
<C> <S> <C>
CHF 406,671 Swiss francs in interest-bearing bank accounts ............................ $ 339,657
------------
CHF 3,700,000 5.250% Swiss Confederation bonds, 02-11-98 ................................ 3,215,443
CHF 4,000,000 4.000% Swiss Confederation bonds, 03-10-99 ................................ 3,427,709
CHF 820,000 7.000% Swiss Confereration bonds, 07-09-01 ................................ 787,434
------------
Total Swiss Confederation bonds 7,430,586
------------
Total Swiss Franc Assets (Cost $6,482,601) $ 7,770,243
------------
</TABLE>
<TABLE>
<CAPTION>
Number STOCKS OF UNITED STATES AND FOREIGN REAL ESTATE AND NATURAL
Of Shares RESOURCE COMPANIES - 14.55% of Total Net Assets
---------
<C> <S> <C>
NATURAL RESOURCES - 5.09% of Total Net Assets
14,300 Broken Hill Proprietary, Ltd. ............................................. $ 382,525
12,000 Burlington Resources, Inc. ................................................ 513,000
17,200 Cypress Amax Minerals Company ............................................ 369,800
26,600 Forest Oil Corporation (a) ................................................ 349,125
15,200 Inco, Ltd. ................................................................ 467,400
20,000 Pogo Producing Company .................................................... 667,500
34,300 Santa Fe Energy Resources, Inc. (a) ...................................... 390,163
60,000 Westmoreland Coal Company (a) ............................................. 180,000
10,000 Weyerhaeuser Company ..................................................... 417,500
------------
$ 3,737,013
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
REAL ESTATE - 9.46% of Total Net Assets
30,264 BRE Properties, Inc. Class A .............................................. $ 643,110
38,700 Burnham Pacific Properties, Inc. .......................................... 449,888
23,500 Federal Realty Investment Trust ........................................... 525,813
36,500 HRE Properties ............................................................ 538,375
47,000 IRT Property Company ...................................................... 440,625
34,200 MGI Properties ............................................................ 594,225
21,000 New Plan Realty Trust ..................................................... 446,250
20,100 Pennsylvania Real Estate Investment Trust ................................. 394,463
27,500 Security Capital Pacific Trust ............................................ 570,625
24,900 Texas Pacific Land Trust .................................................. 722,100
47,200 United Dominion Realty Trust, Inc. ........................................ 643,100
31,900 Washington Real Estate Investment Trust ................................... 514,388
37,300 Western Investment Real Estate Trust ...................................... 466,250
-----------
$ 6,949,212
-----------
Total Stocks of United States and Foreign Real Estate and Natural
Resource Companies (Cost $8,359,131) $10,686,225
-----------
AGGRESSIVE GROWTH STOCK INVESTMENTS, INCLUDING AN INVESTMENT
IN AN AFFILIATE - 15.44% of Total Net Assets
AGGRESSIVE GROWTH STOCK INVESTMENTS - 15.44% of Total Net Assets
CHEMICALS - .69% of Total Net Assets
6,200 Air Products and Chemicals, Inc. ......................................... $ 330,925
9,000 Wellman, Inc. ............................................................ 175,500
-----------
$ 506,425
COMPUTER SOFTWARE - .59% of Total Net Assets
7,000 Autodesk, Inc. ........................................................... $ 161,438
1 Symantec Corporation warrant (a)(e) ...................................... 276,452
-----------
$ 437,890
CONSTRUCTION - .57% of Total Net Assets
2,500 Fluor Corporation ........................................................ $ 150,625
8,000 The Ryland Group, Inc. ................................................... 119,000
16,900 Schuller Corporation ...................................................... 147,875
-----------
$ 417,500
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
DATA PROCESS1NG - .82% of Total Net Assets
7,800 Hewlett-Packard Company ................................................... $ 343,200
5,300 Seagate Technology, Inc. (a) ............................................. 256,388
----------
$ 599,588
ELECTRICAL AND ELECTRONICS - 2.00% of Total Net Assets
24,000 DSC Communications Corporation (a) ....................................... $ 720,000
7,300 Intel Corporation ........................................................ 548,413
14,500 National Semiconductor Corporation (a) .................................... 204,813
----------
$1,473,226
ENTERTAINMENT AND LEISURE - 2.17% of Total Net Assets
2,500 The Walt Disney Company .................................................. $ 139,063
4,500 Harcourt General, Inc. ................................................... 215,438
24,000 Harrah's Entertainment, Inc. (a) ......................................... 528,000
12,000 Promus Hotel Corporation (a) .............................................. 327,000
12,600 Sizzler International, Inc. .............................................. 34,650
2,100 Tribune Company .......................................................... 147,000
5,900 Viacom, Inc. Class A (a) .................................................. 202,075
----------
$1,593,226
FINANCIAL SERVICES - 1.71% of Total Net Assets
3,000 Bank of New York, Inc. warrants (a) ..................................... $ 124,500
6,525 Bank of Petaluma (a) ...................................................... 122,344
8,400 The Bear Stearns Companies, Inc. ......................................... 189,000
4,000 Morgan Stanley Group, Inc. ............................................... 195,000
17,474 The Charles Schwab Corporation ........................................... 421,560
4,000 State Street Boston Corporation .......................................... 201,000
----------
$1,253,404
MANUFACTURING - 2.80% of Total Net Assets
23,000 Collins Industries, Inc. warrants (a) .................................... $ 719
5,000 Dana Corporation ......................................................... 139,375
15,000 Harley-Davidson, Inc. ..................................................... 615,000
5,100 Harnischfeger Industries, Inc. ............................................ 158,100
3,500 Illinois Tool Works, Inc. ................................................ 225,313
10,618 Mattel, Inc. ............................................................. 262,796
2,000 Nacco Industries, Inc. Class A ........................................... 102,750
8,000 Nacco Industries, Inc. Class B ........................................... 411,000
4,000 Parker Hannifin Corporation .............................................. 139,500
----------
$2,054,553
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
OIL AND OILFIELD SERVICES - .38% of Total Net Assets
20,000 Parker Drilling Company (a) ............................................... $ 115,000
48,200 Wainoco Oil Corporation (a) ............................................... 162,675
-----------
$ 277,675
PHARMACEUTICALS - 1.02% of Total Net Assets
10,000 Abbott Laboratories ....................................................... $ 440,000
1,200 Biogen, Inc. (a) .......................................................... 73,350
1,441 Chiron Corporation (a) .................................................... 126,808
7,000 Genzyme Corporation warrants (a) .......................................... 106,750
-----------
$ 746,908
RETAIL - .51% of Total Net Assets
12,000 Price/Costco, Inc. (a) .................................................... $ 246,000
5,000 Toys "R" Us, Inc. (a) ...................................................... 131,875
-----------
$ 377,875
TRANSPORTATION - 1.11% of Total Net Assets
12,300 Atlantic Southeast Airlines, Inc. ......................................... $ 290,588
4,600 Kansas City Southern Industries, Inc. ..................................... 178,250
8,000 M.S. Carriers, Inc. (a) .................................................... 168,000
20,000 Mesa Airlines, Inc. (a) .................................................... 180,000
-----------
$ 816,838
MISCELLANEOUS - 1.07% of Total Net Assets
12,000 Bethlehem Steel Corporation (a) ........................................... $ 120,000
5,000 Browning-Ferris Industries, Inc. ........................................... 111,875
5,090 Lockheed Martin Corporation ............................................... 421,834
2,800 Temple-Inland, Inc. ....................................................... 132,650
-----------
$ 786,359
-----------
$11,341,467
-----------
INVESTMENT IN AN AFFILIATE - 0% of Total Net Assets
100 World Money Securities, Inc. (a)(b)(e) .................................... $ -
-----------
$ -
-----------
Total Aggressive Growth Stock Investments (Cost$7,045,060),
including an Investment in an Affiliate $11,341,467
-----------
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
DOLLAR ASSETS - 33.74% of Total Net Assets
CORPORATE BONDS - 2.34% of Total Net Assets
$ 100,000 7.375% American General Finance Corporation, 11-15-96 ..................... $ 100,524
100,000 6.875% Associates Corporation of North America, 01-15-97 .................. 100,546
100,000 8.750% Dillard Department Stores, Inc., 06-15-98 .......................... 103,906
100,000 8.450% DuPont El DeNemours & Company, 10-15-96 ............................ 100,606
100,000 8.300% Hertz Corporation, 02-02-98 ........................................ 102,841
100,000 7.900% International Lease Finance Company, 10-01-96 ...................... 100,404
100,000 5.650% Lockheed Martin Corporation, 04-01-97 .............................. 99,851
100,000 7.500% Pacific Northwest Bell Telephone Company, 12-01-96 ................. 100,601
100,000 7.875% PepsiCo, Inc., 08-15-96 ............................................ 100,120
100,000 6.500% Pfizer, Inc., 02-01-97 ............................................. 100,452
100,000 9.000% Philip Morris Companies, Inc., 05-15-98 ............................ 104,108
100,000 9.375% Saint Paul Companies, Inc., 06-15-97 ............................... 102,631
100,000 6.125% Southern California Edison Company, 07-15-97 ....................... 99,962
100,000 7.625% Travelers Group, Inc., 01-15-97 .................................... 100,870
100,000 6.750% USLIFE Corporation, 01-15-98 ....................................... 100,382
100,000 7.375% Virginia Electric & Power Company, 06-01-98 ........................ 104,735
100,000 6.375% WMX Technologies, Inc., 07-01-97 ................................... 100,310
------------
$ 1,722,849
UNITED STATES TREASURY SECURITIES - 31.40% of Total Net Assets
41,000,000 United States Stripped Principal Only Treasury bonds 7.250%, 05-15-18 (f).. $ 8,681,750
800,000 United States Treasury bonds 6.250%, 08-15-23 ............................ 721,448
2,000,000 United States Treasury notes 6.750%, 02-28-97 ............................. 2,013,120
1,200,000 United States Treasury notes 6.125%, 05-31-97 ............................. 1,202,928
300,000 United States Treasury notes 6.000%, 08-31-97 ............................. 300,144
3,000,000 United States Treasury notes 5.625%, 01-31-98 ............................ 2,980,260
3,000,000 United States Treasury notes 7.750%, 01-31-00 ............................ 3,119,460
600,000 United States Treasury bills 4.190%, 08-08-96 (f) ........................ 599,442
1,000,000 United States Treasury bills 4.790%, 09-19-96 (f) ........................ 993,390
2,600,000 United States Treasury bills 5.760%, 07-24-97 (f) ........................ 2,459,080
------------
$ 23,071,022
------------
Total Dollar Assets (Cost $28,962,701) $ 24,793,871
------------
Total Portfolio - 99.07% of total net assets (identified cost $70,411,796)(d) $ 72,780,467
Other assets, less liabilities (.93% of total net assets) 681,926
------------
Net assets applicable to outstanding shares $ 73,462,393
============
<FN>
Note:(a) Non-income producing.
(b) Restricted security.
(c) Affiliated investment trust.
(d) Aggregate cost for Federal income tax purposes was $64,059,564.
(e) Market value determined by the Board of Directors.
(f) Interest rate represents yield to maturity.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE TREASURY BILL PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
UNITED STATES TREASURY SECURITIES - 98.58% of Total Net Assets
$32,000,000 United States Treasury notes 4.375%, 08-15-96 ............................. $ 31,998,400
25,600,000 United States Treasury notes 6.250%, 08-31-96 ............................. 25,615,616
26,000,000 United States Treasury notes 7.250%, 11-30-96 ............................. 26,145,860
27,000,000 United States Treasury notes 7.500%, 12-31-96 ............................. 27,222,750
-------------
Total Portfolio - 98.58% of total net assets (identified cost $110,987,068)(a) $ 110,982,626
Other assets, less liabilities (1.42% of total net assets) 1,599,106
-------------
Net assets applicable to outstanding shares $ 112,581,732
=============
<FN>
Note:(a) Aggregate cost for Federal income tax purposes.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE VERSATILE BOND PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
CORPORATE BONDS - 96.45% of Total Net Assets
AEROSPACE - 4.72% of Total Net Assets
$ 900,000 5.650% Lockheed Martin Corporation, 04-01-97 ............................. $ 898,659
------------
$ 898,659
AUTOMOBILE RENTAL AND SERVICES - 4.86% of Total Net Assets
900,000 8.300% Hertz Corporation, 02-02-98 ........................................ $ 925,569
------------
$ 925,569
BEVERAGES - 4.73% of Total Net Assets
900,000 7.875% PepsiCo, Inc., 08-15-96 ............................................ $ 901,080
------------
$ 901,080
CHEMICALS - 4.75% of Total Net Assets
900,000 8.450% DuPont EI DeNemours & Company, 10-15-96 ........................... $ 905,454
------------
$ 905,454
ENVIRONMENTAL - 4.74% of Total Net Assets
900,000 6.375% WMX Technologies, Inc., 07-01-97 ................................... $ 902,790
------------
$ 902,790
FINANCIAL SERVICES - 14.25% of Total Net Assets
900,000 7.375% American General Finance Corporation, 11-15-96 .................... $ 904,716
900,000 6.875% Associates Corporation of North America, 01-15-97 ................. 904,914
900,000 7.900% International Lease Finance Company, 10-01-96 ..................... 903,636
------------
$ 2,713,266
INSURANCE - 14.36% of Total Net Assets
900,000 9.375% Saint Paul Companies, Inc., 06-15-97 .............................. $ 923,679
900,000 7.625% Travelers Group, Inc., 01-15-97 ................................... 907,830
900,000 6.750% USLIFE Corporation, 01-15-98 ...................................... 903,438
------------
$ 2,734,947
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE VERSATILE BOND PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
PHARMACEUTICALS - 4.75% of Total Net Assets
$ 900,000 6.500% Pfizer, Inc., 02-01-97 ............................................ $ 904,068
------------
$ 904,068
RETAIL - 10.10% of Total Net Assets
900,000 8.750% Dillard Department Stores, Inc., 06-15-98 ......................... $ 935,154
1,000,000 5.500% Wal-Mart Stores, Inc., 03-01-98 ................................... 988,360
------------
$ 1,923,514
TELECOMMUNICATIONS - 10.00% of Total Net Assets
1,000,000 6.250% New England Telephone & Telegraph Company, 12-15-97................. $ 1,000,150
900,000 7.500% Pacific Northwest Bell Telephone Company, 12-01-96 ................ 905,409
------------
$ 1,905,559
TOBACCO - 4.92% of Total Net Assets
900,000 9.000% Philip Morris Companies, Inc., 05-15-98 ........................... $ 936,972
------------
$ 936,972
UTILITIES - 14.27% of Total Net Assets
900,000 5.000% Gulf Power Company, 07-01-98 ...................................... $ 876,742
900,000 6.125% Southern California Edison Company, 07-15-97 ...................... 899,658
900,000 9.375% Virginia Electric & Power Company, 06-01-98 ....................... 942,615
------------
$ 2,719,015
------------
Total Corporate Bonds (Cost $18,372,758) $ 18,370,893
------------
UNITED STATES TREASURY SECURITIES - 6.51% of Total Net Assets
500,000 United States Treasury notes 6.125%, 03-31-98 ........................... $ 499,975
740,000 United States Treasury bills 4.190%, 08-08-96(b) ......................... 739,309
------------
Total United States Treasury Securities (Cost $1,240,165) $ 1,239,284
------------
Total Portfolio - 102.96% of total net assets (identified cost $19,612,923)(a) $ 19,610,177
Liabilities, less other assets (2.96% of total net assets) (563,409)
------------
Net assets applicable to outstanding shares $ 19,046,768
============
<FN>
Note: (a) Aggregate cost for Federal income tax purposes.
(b) Interest rate represents yield to maturity.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE AGGRESSIVE GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
AGGRESSIVE GROWTH STOCK INVESTMENTS - 99.81% of Total Net Assets
CHEMICALS - 4.82% of Total Net Assets
6,000 Air Products and Chemicals, Inc. .......................................... $ 320,250
12,000 Wellman, Inc. ............................................................. 234,000
----------
$ 554,250
COMPUTER SOFTWARE - 4.01% of Total Net Assets
6,100 Autodesk, Inc. ............................................................ $ 140,681
6,300 Computer Associates International, Inc. ................................... 320,513
----------
$ 461,194
CONSTRUCTION - 6.09% of Total Net Assets
4,400 Fluor Corporation ......................................................... $ 265,100
17,500 The Ryland Group, Inc. ................................................... 260,313
20,000 Schuller Corporation ...................................................... 175,000
----------
$ 700,413
DATA PROCESSING - 7.79% of Total Net Assets
27,827 AST Research, Inc. (a) .................................................... $ 149,570
9,800 Hewlett-Packard Company ................................................... 431,200
6,500 Seagate Technology, Inc. (a) .............................................. 314,438
----------
$ 895,208
ELECTRICAL & ELECTRONICS - 7.21% of Total Net Assets
6,200 DSC Communications Corporation (a) ........................................ $ 186,000
5,700 Intel Corporation ......................................................... 428,213
15,200 National Semiconductor Corporation (a) .................................... 214,700
----------
$ 828,913
ENTERTAINMENT AND LEISURE - 10.09% of Total Net Assets
3,700 The Walt Disney Company ................................................... $ 205,813
5,100 Harcourt General, Inc. .................................................... 244,163
42,300 Sizzler International, Inc. ............................................... 116,325
4,800 Tribune Company .......................................................... 336,000
7,500 Viacom, Inc. Class A (a) .................................................. 256,875
----------
$1,159,176
FINANCIAL SERVICES - 12.03% of Total Net Assets
2,600 Bank of New York, Inc. warrants (a) ...................................... $ 107,900
15,412 The Bear Stearns Companies, Inc. .......................................... 346,770
5,600 Morgan Stanley Group, Inc. ................................................ 273,000
15,300 The Charles Schwab Corporation ............................................ 369,113
5,700 State Street Boston Corporation ........................................... 286,425
----------
$1,383,208
MANUFACTURING - 10.82% of Total Net Assets
8,400 Dana Corporation ......................................................... $ 234,150
6,900 Harnischfeger Industries, Inc. ............................................ 213,900
4,300 Illinois Tool Works, Inc. ................................................. 276,813
9,983 Mattel, Inc. .............................................................. 247,074
7,800 Parker Hannifin Corporation ............................................... 272,025
----------
$1,243,962
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE AGGRESSIVE GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1996
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
OIL AND OILFIELD SERVICES - 3.00% of Total Net Assets
18,700 Parker Drilling Company (a) .............................................. $ 107,525
70,400 Wainoco Oil Corporation (a) ............................................... 237,600
-----------
$ 345,125
PHARMACEUTICALS - 7.91% of Total Net Assets
5,600 Amgen, Inc. (a) .......................................................... $ 305,900
5,500 Biogen, Inc. (a) ......................................................... 336,188
2,000 Chiron Corporation (a) .................................................... 176,000
6,000 Genzyme Corporation warrants (a) ......................................... 91,500
-----------
$ 909,588
RETAIL - 5.70% of Total Net Assets
15,200 Price/Costco, Inc. (a) .................................................... $ 311,600
13,000 Toys "R" Us, Inc. (a) ..................................................... 342,875
-----------
$ 654,475
TRANSPORTATION - 10.34% of Total Net Assets
11,700 Atlantic Southeast Airlines, Inc. ......................................... $ 276,413
5,600 Kansas City Southern Industries, Inc. ..................................... 217,000
17,000 M.S. Carriers, Inc. (a) ................................................... 357,000
37,500 Mesa Airlines, Inc. (a) .................................................. 337,500
-----------
$ 1,187,913
MISCELLANEOUS - 10.00% of Total Net Assets
18,600 Bethlehem Steel Corporation (a) ........................................... $ 186,000
9,000 Browning-Ferris Industries, Inc. .......................................... 201,375
5,500 Lockheed Martin Corporation .............................................. 455,813
6,450 Temple-Inland, Inc. ....................................................... 305,569
-----------
$ 1,148,757
-----------
<CAPTION>
Total Portfolio - 99.81% of total net assets (identified cost $8,777,882)(b) $11,472,182
Other assets, less liabilities (.19% of total net assets) 21,413
-----------
Net assets applicable to outstanding shares $11,493,595
===========
<FN>
Note:(a) Non-income producing.
(b) Aggregate cost for Federal income tax purposes.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1996
(Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES
Permanent Portfolio Family of Funds, Inc. (the "Fund") is registered under
the Investment Company Act of 1940 as a no-load, open-end, series
management investment company. The Fund commenced operations as the
Permanent Portfolio, the Treasury Bill Portfolio, the Versatile Bond
Portfolio and the Aggressive Growth Portfolio on January 8, 1982, May 26,
1987, September 27, 1991 and January 2, 1990, respectively. Investment
operations in the Permanent Portfolio, the Treasury Bill Portfolio, the
Versatile Bond Portfolio and the Aggressive Growth Portfolio commenced on
December 1, 1982, September 21, 1987, November 12, 1991 and May 16, 1990,
respectively.
The following significant accounting policies are consistently followed by
the Fund in the preparation of its financial statements, and such policies
are in conformity with generally accepted accounting principles for
registered investment companies. The preparation of such financial
statements requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses earned and incurred,
respectively, during the reporting period. Actual results could differ from
those estimates.
Valuation of investments
Investments are valued at market. Securities for which market quotations
are readily available are valued at the latest sale price. Unlisted
securities or securities for which the most active market is
over-the-counter are valued at the mean between the closing bid and asked
prices. Swiss francs are valued at the closing spot price on the
International Monetary Market. Swiss Confederation bonds are valued at the
closing price in Zurich, Switzerland, converted into U.S. dollars at 4 p.m.
(Eastern Time). Investments in gold and silver are valued based on the
closing spot prices on the New York Commodity Exchange. Short-term
securities are valued at market daily. Investments for which there is no
active market are valued at fair value as determined by the Board of
Directors. At July 31, 1996, two investments in the Permanent Portfolio
(0.38)% of total net assets) were so valued.
Investment transactions and investment income
Investment transactions are accounted for on the date of purchase, sale or
maturity. Interest income is accrued daily and includes amortization of any
premium and discount for financial and tax reporting purposes. Dividend
income is recorded on the ex-dividend date. Realized gains and losses from
securities transactions and unrealized appreciation or depreciation of
investments are recorded on an identified cost basis for financial and tax
reporting purposes.
For the six months ended July 31, 1996, investment income was earned as
follows:
<TABLE>
<CAPTION>
Permanent Treasury Bill Versatile Bond Aggressive Growth
Portfolio Portfolio Portfolio Portfolio
------------ ------------- -------------- -----------------
<S> <C> <C> <C> <C>
Interest on:
Corporate bonds $ 31,632 $ - $ 562,236 $ -
Swiss franc assets 153,308 - - -
United States Treasury securities 1,075,173 2,829,507 12,894 -
Other investments 19,912 22,885 27,006 3,558
Dividends 423,482 - - 175,288
------------ ------------ ------------ -----------
Total $ 1,703,507 $ 2,852,392 $ 602,136 $ 178,846
============ ============ ============ ===========
</TABLE>
Translation of foreign currencies
Amounts denominated in or expected to settle in foreign currencies are
translated into U.S. dollars on the following basis: (i) market value of
investment securities and other assets and liabilities are translated at
the closing rate of exchange at July 31, 1996; and (ii) purchases and sales
of investment securities, income and expenses are translated at the rate of
exchange prevailing on the respective dates of such transactions.
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1996
(Unaudited)
The Fund separately reports the portions of the results of operations
attributable to the effect of changes in foreign exchange rates on the
value of investments. Reported net realized foreign exchange gains or
losses arise from sales of foreign currencies; foreign currency gains or
losses realized between the trade and settlement dates on securities
transactions; and the difference between the amounts of dividends, interest
and foreign withholding taxes recorded on the Fund's books verses the U.S.
dollar equivalent of the amounts actually received or paid. Net unrealized
foreign exchange gains arise from changes in the exchange rate applicable
to cash, receivables and liabilities denominated in foreign currencies at
July 31, 1996.
Federal income taxes
Each of the Fund's Portfolios will continue to be treated as a separate
regulated investment company and each Portfolio intends to qualify under
Subchapter M of the United States Internal Revenue Code of 1986, as amended
(the "Code"). Accordingly, no provision has been made for United States
income taxes, as each Portfolio intends to declare necessary dividend
distributions from investment company taxable income and net realized
capital gains, if any, to its shareholders prior to October 15, 1996
pursuant to the requirements of the Code.
At July 31, 1996, capital loss carryforwards available to offset future net
realized gains, if any, aggregate approximately: $149,000 in the Treasury
Bill Portfolio, of which $4,000, $99,000, $41,000, and $5,000 expire on
January 31, 2001, January 31, 2002, January 31, 2003 and January 31, 2004,
respectively; and $136,000 in the Versatile Bond Portfolio, of which
$102,000 and $34,000 expire on January 31, 2003 and January 31, 2004,
respectively. There were no capital loss carryforwards in the Permanent
Portfolio or the Aggressive Growth Portfolio. Additionally, net capital
losses of approximately $3,000, in the Treasury Bill Portfolio are
attributable to investment transactions that occurred after October 31,
1995 and are recognized for Federal income tax purposes as arising on
February 1, 1996, the first day of the Portfolio's next taxable year.
Pursuant to the Code, 30.11% and 96.80% of the distributions made from
investment company taxable income in 1995 by the Permanent Portfolio and
Aggressive Growth Portfolio, respectively, qualify for the corporate
dividends received deduction.
Distributions
Distributions to shareholders from net investment income and net realized
gain on investments, if any, are recorded on the ex-dividend date. The
amount of such distributions are determined in accordance with the Code
which may differ from generally accepted accounting principles. These
differences result primarily from different treatment of net investment
income and net realized gains on certain investment securities held by the
Fund's Portfolios. During the six months ended July 31, 1996, the Fund
reclassified from undistributed net investment income to paid-in capital,
certain book and tax basis differences relating to shareholder
distributions, totaling $175,604, $1,405,517 and $456,456 for the Permanent
Portfolio, the Treasury Bill Portfolio and the Versatile Bond Portfolio,
respectively. There were no such differences reclassified in the Aggressive
Growth Portfolio during the period then ended. At July 31, 1996,
undistributed net investment income exceeds amounts distributable under the
Fund's distribution policy referred to above by approximately $6,200,000,
$600,000, $900,000 and $123,000 for the Permanent Portfolio, the Treasury
Bill Portfolio, the Versatile Bond Portfolio and the Aggressive Growth
Portfolio, respectively.
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1996
(Unaudited)
Equalization
The Fund follows the accounting practice of equalization, by which a
portion of the proceeds from sales and a portion of the costs of
redemptions of shares of capital stock are allocated to undistributed net
investment income. The effect of this practice is to prevent the
calculation of net investment income per share from being affected by sales
or redemptions of shares in each Portfolio, and for periods of net
issuances of shares, allows undistributed net investment income to exceed
distributable investment company taxable income.
2. INVESTMENTS IN AFFILIATED ISSUERS
During fiscal year 1990, the Permanent Portfolio acquired from World Money
Managers ("WMM"), the Fund's investment adviser and distributor for that
Portfolio, a 100% interest in World Money Securities, Inc. ("WMS"), a
registered broker-dealer and distributor for the Fund's Treasury Bill
Portfolio, Versatile Bond Portfolio and Aggressive Growth Portfolio. Under
the terms of the acquisition, additional investments could be made by the
Permanent Portfolio in WMS, an illiquid, restricted security, provided that
the aggregate investment cost did not exceed 1% of the net assets of the
Permanent Portfolio at the date of an additional investment. On February
17, 1996, the Fund's Board of Directors voted to discontinue the business
of WMS and directed the Board of Directors of WMS to prepare a Complete
Plan of Liquidation (the "Plan") which was adopted on February 29, 1996.
The Plan provides for the realization and satisfaction of all of WMS's
remaining assets and liabilities, respectively, and the termination of
WMS's existence. Assets of WMS remaining after completion of the Plan, if
any, will be distributed to the Permanent Portfolio as a liquidating
dividend. The Fund's management believes any such dividend will be
immaterial to the Permanent Portfolio's financial position. Accordingly,
and as determined by the Fund's Board of Directors, the investment, which
had a cost basis of $924,881 and a fair value of $55,358 at February 16,
1996, had no fair value (0% of total net assets) at July 31, 1996. The
Permanent Portfolio received no dividends or interest from WMS during the
six months then ended, nor was it permitted to make any additional
investments in WMS during that time.
The Permanent Portfolio held 4,297 units of United States Gold Trust, an
affiliated investment trust, resulting in net unrealized appreciation of
$564 at July 31, 1996. The Permanent Portfolio received no income from
this investment during the six months then ended. There were no commissions
paid to WMS relating to purchases and sales of these units during the six
months then ended.
3. INVESTMENT ADVISORY CONTRACT
In accordance with the terms of an Investment Advisory Contract (the
"Contract"), WMM receives monthly, a comprehensive advisory fee computed at
the following annual rate: (i) for each Portfolio, 1/4 of 1% of the first
$200 million of the Portfolio's average daily net assets; plus (ii) for the
Fund as a whole: 7/8 of 1% of the first $200 million of the Fund's average
daily net assets; 13/16 of 1% of the next $200 million of the Fund's
average daily net assets; 3/4 of 1% of the next $200 million of the Fund's
average daily net assets; and 11/16 of 1% of the Fund's average daily net
assets in excess of $600 million, such fee for the Fund as a whole to be
allocated among the Portfolios in proportion to their net assets. Effective
January 1, 1996, WMM has voluntarily agreed to continue to waive for at
least the current calendar year ending December 31, 1996, portions of the
advisory fee allocable to the Treasury Bill Portfolio and to the Versatile
Bond Portfolio to the extent that either Portfolio's total advisory fee
otherwise would exceed an annual rate of 5/8 of 1%, in the case of the
Treasury Bill Portfolio, or 3/4 of 1%, in the case of the Versatile Bond
Portfolio, of the respective Portfolio's average daily net assets.
Thereafter, WMM reserves the right to revoke, reduce or change the waiver
prospectively upon five days' written notice to the Fund.
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1996
(Unaudited)
All fees and expenses directly attributable to a Portfolio are borne
entirely by that Portfolio; all other such fees and expenses are allocated
among the Fund's Portfolios in proportion to their net assets. Except for
the comprehensive advisory fee, the fees and expenses of the Fund's
directors who are not also officers of the Fund through August 22, 1996
(See Note 9), excise taxes and extraordinary expenses as defined by the
Contract, WMM pays or reimburses the Fund for substantially all of the
Fund's ordinary operating expenses out of its comprehensive advisory fee.
WMM is a limited partnership of which one of the general partners is the
President and a director of the Fund and the other general partner is a
corporation wholly owned by the same individual.
4. PURCHASES AND SALES OF SECURITIES
The following is a summary of purchases and sales of securities other than
short-term securities for the six months ended July 31, 1996:
<TABLE>
<CAPTION>
Permanent Treasury Bill Versatile Bond Aggressive Growth
Portfolio Portfolio Portfolio Portfolio
----------- ------------- -------------- -----------------
<S> <C> <C> <C> <C>
Purchases................................ $ 5,594,811 None $11,069,189 $ 1,209,645
Sales.................................... 4,907,858 None 11,761,311 494,563
</TABLE>
5. NET UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS
<TABLE>
The following is a summary of net unrealized appreciation (depreciation) of investments at
July 31, 1996 for federal income tax purposes:
<CAPTION>
Permanent Treasury Bill Versatile Bond Aggressive Growth
Portfolio Portfolio Portfolio Portfolio
------------- ------------- -------------- -----------------
<S> <C> <C> <C> <C>
Aggregate gross unrealized appreciation of
investments with excess of value over tax cost:
Investments in securities of
unaffiliated issuers .................... $ 12,342,097 $ 6,905 $ 34,610 $ 3,217,602
Investments other than securities........ 220,667 - - -
------------- --------- ---------- -----------
12,562,764 6,905 34,610 3,217,602
Aggregate gross unrealized depreciation
of investments with excess of tax
cost over value:
Investments in securities of unaffiliated
issuers ................................. (1,327,619) (11,347) (37,356) (523,302)
Investments other than securities........ (1,589,361) - - -
Investment in an affiliated issuer....... (924,881) - - -
------------- --------- ---------- -----------
(3,841,861) (11,347) (37,356) (523,302)
------------- --------- ---------- -----------
Net unrealized appreciation (depreciation)
of investments $ 8,720,903 $ (4,442) $ (2,746) $ 2,694,300
============= ========= ========== ===========
</TABLE>
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1996
(Unaudited)
6. CAPITAL STOCK TRANSACTIONS
<TABLE>
Transactions in shares of each Portfolio's capital stock exclusive of
amounts allocated to undistributed net investment income were as follows
for the period and year ended:
<CAPTION>
Permanent Portfolio
---------------------------------------------------------------------------------
Six months ended July 31, 1996 Year ended January 31, 1996
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 301,393 $ 5,090,215 361,698 $ 5,920,587
Distributions reinvested......... - - 76,064 1,415,559
--------- ------------ ---------- ------------
301,393 5,090,215 437,762 7,336,146
Shares redeemed.................. (367,381) (6,144,727) (698,896) (11,391,963)
--------- ------------ ---------- ------------
Net decrease ( 65,988) $ (1,054,512) (261,134) $ (4,055,817)
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Treasury Bill Portfolio
---------------------------------------------------------------------------------
Six months ended July 31, 1996 Year ended January 31, 1996
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 322,229 $ 20,710,771 675,087 $ 42,837,954
Distributions reinvested......... - - 39,686 2,678,382
--------- ------------ ---------- ------------
322,229 20,710,771 714,773 45,516,336
Shares redeemed.................. (386,615) (24,835,966) (856,988) (54,518,659)
--------- ------------ ---------- ------------
Net decrease (64,386) $ (4,125,195) (142,215) $ (9,002,323)
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Versatile Bond Portfolio
---------------------------------------------------------------------------------
Six months ended July 31, 1996 Year ended January 31, 1996
---------------------------------------- --------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- -----------------
<S> <C> <C> <C> <C>
Shares sold...................... 57,336 $ 2,900,557 226,619 $ 11,362,172
Distributions reinvested......... - - 11,536 650,964
--------- ------------ ---------- ------------
57,336 2,900,557 238,155 12,013,136
Shares redeemed.................. (82,473) (4,172,594) (288,848) (14,556,424)
--------- ------------ ---------- ------------
Net decrease (25,137) $ (1,272,037) (50,693) $ (2,543,288)
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Aggressive Growth Portfolio
---------------------------------------------------------------------------------
Six months ended July 31, 1996 Year ended January 31, 1996
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 53,541 $ 2,291,571 121,097 $ 4,712,767
Distributions reinvested......... - - 9,846 395,703
--------- ------------ ---------- ------------
53,541 2,291,571 130,943 5,108,470
Shares redeemed.................. (39,639) (1,661,475) (72,494) (2,728,428)
--------- ------------ ---------- ------------
Net increase 13,902 $ 630,096 58,449 $ 2,380,042
========= ============ ========== ============
</TABLE>
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1996
(Unaudited)
7. LINE OF CREDIT
On March 3, 1990, the Fund entered into a line of credit agreement with a
foreign bank whereby the Permanent Portfolio may borrow up to $2,000,000
for a period not to exceed twenty-one days, for the purpose of making
settlement for purchases of investments in the event that banks in the
United States are not able to operate according to their normal procedures.
Interest is charged at a base rate of 1.0% per annum above the offered rate
for deposits of United States Dollars on the London Interbank Market
(LIBOR) for terms substantially similar to any drawdown. The Permanent
Portfolio is obligated to pay a commitment fee of 1/2% ($10,000), payable
annually, on the entire commitment amount.
The line is collateralized by United States Treasury bills having a face
value of not less than 125% of the outstanding principal balance and a
maturity date of not more than one year. The agreement contains certain
covenants, including but not limited to, the Permanent Portfolio
maintaining a specified net asset value of at least $60 million. During the
six months ended July 31, 1996, there were no amounts outstanding under
this agreement.
8. REGULATORY MATTERS
By letter dated February 9, 1994 (the "Letter"), the Staff of the San
Francisco District Office of the Securities and Exchange Commission (the
"Staff" and "Commission," respectively) advised the Fund and certain of its
officers and affiliates of alleged violations of certain provisions of
federal securities laws, including those relating to the Fund's advertising
materials, transactions among the Fund's Portfolios, the Fund's
distribution expense practices and the composition of the Fund's Board of
Directors. The Staff stated in the Letter that it had decided to recommend
to the Commission that it authorize the filing of a civil action and the
institution of public administrative proceedings seeking sanctions against
certain of the Fund's officers and affiliates. Management of the Fund
believes that there have been no such violations. During the six months
ended July 31, 1996, the Fund received no further communications regarding
the matter from the Staff or the Commission and as of July 31, 1996, no
such civil action or public administrative proceedings have been
instituted. Pursuant to Maryland law and the Fund's bylaws, the Fund has
agreed to pay directly on behalf of certain officers, directors and
affiliates, or to reimburse them, for certain expenses incurred by them in
connection with the matter. The Fund's Permanent Portfolio, Treasury Bill
Portfolio, Versatile Bond Portfolio and Aggressive Growth Portfolio so paid
or reimbursed expenses of $18,280, $15,152, $1,010 and $769, respectively,
during the six months then ended.
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1996
(Unaudited)
<TABLE>
9. SPECIAL MEETING OF SHAREHOLDERS
On August 22, 1996, a special meeting of shareholders in the Fund was held to
vote on the following proposals:
(i). To elect six directors.
(ii). To approve a new Investment Advisory Contract (the "new Contract") between
the Fund and WMM that is identical to the current Contract except for the
elimination of the provision whereby WMM is obligated to pay fees and expenses
of the Fund's officers and of the Fund's directors who are also officers.
A summary of the voting results is as follows:
<CAPTION>
Permanent Treasury Bill Versatile Bond Aggressive Growth
Portfolio Portfolio Portfolio Portfolio
-------------- ----------------- ------------------ -------------------
<S> <C> <C> <C> <C>
Proposal (i) Election of directors:
David P. Bergland
Affirmative 1,997,666.382 923,028,437 173,261.784 155,428.549
Withhold 55,350.228 13,399,227 4,814.191 8,255.074
Hugh A. Butler
Affirmative 1,998,816.083 923,065.678 173,322.062 155,514.905
Withhold 54,200.527 13,361.986 4,753.913 8,168.718
Terry Coxon
Affirmative 2,004,282.116 924,272.479 173,322.062 155,537.117
Withhold 48,734.494 12,155.185 4,753.913 8,146.506
Robert B. Martin, Jr.
Affirmative 1,997,540.282 923,190.984 173,261.784 155,428.549
Withhold 55,476.328 13,236.680 4,814.191 8,255.074
Alan M. Sergy
Affirmative 2,004,850.661 923,228.225 173,322.062 155,621.381
Withhold 48,165.949 13,199.439 4,753.913 8,062.242
Mark Tier
Affirmative 2,003,192.361 921,902.803 173,322.062 155,668.643
Withhold 49,824.249 14,524.861 4,753.913 8,014.980
Proposal (ii) Approval of new Contract:
Affirmative 1,898,886.054 849,901.034 167,578.959 150,882.713
Against 91,515.179 59,521.980 8,180.685 9,626.188
Abstain 62,615.377 27,004.650 2,316.331 3,174.722
</TABLE>
Each of the proposals received the required majority of votes in each portfolio
and were adopted. The new Contract became effective immediately upon approval of
the shareholders of the Fund. There were no broker non-votes submitted with
respect to either proposal, and no other proposals were voted on at the special
meeting.
The Fund's Permanent Portfolio, Treasury Bill Portfolio, Versatile Bond
Portfolio and Aggressive Growth Portfolio incurred solicitation expenses of
$15,804, $6,348, $1,319 and $1,132 in connection with the special meeting during
the six months ended July 31, 1996.
<PAGE>
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<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
<TABLE>
Financial highlights for the Permanent Portfolio
For each share of capital stock outstanding throughout each fiscal period:
<CAPTION>
Six months ended Year ended Year ended Year ended
July 31, 1996 January 31, 1996 January 31, 1995 January 31, 1994
(Unaudited)
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 18.80 $ 16.51 $ 17.55 $ 15.36
--------- --------- -------- --------
Income from investment operations:
Net investment income ................ .29 .50 .64 .44
Net realized and unrealized gains
or losses on investments ........... (.77) 2.17 (1.46) 1.99
--------- --------- -------- --------
Total income or loss from
investment operations (.48) 2.67 (.82) 2.43
Less distributions from:
Net investment income ................ - (.38) (.22) (.24)
Net realized gain on investments ..... - - - -
--------- --------- -------- --------
Total distributions - (.38) (.22) (.24)
--------- --------- -------- --------
Net asset value, end of period $ 18.32 $ 18.80 $ 16.51 $ 17.55
========= ========= ======== ========
Total return (1) ......................... (2.55)% 16.20% (4.65)% 15.86%
Ratios / supplemental data:
Net assets, end of period (in thousands) $ 73,462 $ 76,641 $ 71,610 $ 79,043
========= ========= ======== ========
Ratio of expenses to average net assets.. 1.38%* 1.35% 1.32% 1.21%
Ratio of net investment income
to average net assets ................ 3.13%* 2.85% 2.63% 2.66%
Portfolio turnover rate ................. 19.62%* 9.96% 31.24% 49.51%
Average brokerage commission
rate paid (2) ........................ $ 0.0682 $ - $ - $ -
<FN>
* Computed on an annualized basis.
(l) Assumes reinvestment of all dividends and distributions, and deduction of
all fees and expenses except the $35 one-time account start-up fee and the
$1.50 monthly account maintenance fee.
(2) Average brokerage commission rate paid information was not required for
previous periods.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Year ended Year ended Year ended Year ended Year ended Year ended Year ended
January 31, 1993 January 31, 1992 January 31, 1991 January 31, 1990 January 31, 1989 January 31, 1988 January 31, 1987
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
<C> <C> <C> <C> <C> <C> <C>
$ 15.21 $ 15.10 $ 15.57 $ 15.00 $ 14.71 $ 13.66 $ 11.88
--------- --------- --------- --------- ---------- ---------- ----------
.49 .51 .64 .57 .46 .37 .33
(.05) .51 (.63) - (.15) .80 1.45
--------- --------- --------- --------- ---------- ---------- ----------
.44 1.02 .01 .57 .31 1.17 1.78
(.29) (.91) (.48) - - - -
- - - - (.02) (.12) -
--------- --------- --------- --------- ---------- ---------- ----------
(.29) (.91) (.48) - (.02) (.12) -
--------- --------- --------- --------- ---------- ---------- ----------
$ 15.36 $ 15.21 $ 15.10 $ 15.57 $ 15.00 $ 14.71 $ 13.66
========= ========= ========= ========= ========== ========== ==========
2.93% 7.01% .15% 3.80% 2.11% 8.58% 14.98%
$ 65,937 $ 72,312 $ 80,542 $ 93,663 $ 97,475 $ 90,177 $ 72,523
========= ========= ========= ========= ========== ========== ==========
1.25% 1.27% 1.36% 1.17% 1.17% 1.15% 1.17%
3.20% 3.29% 4.22% 3.80% 3.00% 2.53% 2.51%
70.77% 8.01% 31.58% 61.44% 23.87% 21.97% 30.89%
$ - $ - $ - $ - $ - $ - $ -
</TABLE>
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE TREASURY BILL PORTFOLIO
<TABLE>
Financial highlights for the Treasury Bill Portfolio
For each share of capital stock outstanding throughout each fiscal period:
<CAPTION>
Six months ended Year ended Year ended
July 31, 1996 January 31, 1996 January 31, 1995
(Unaudited)
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 67.84 $ 66.40 $ 64.81
---------- ---------- ----------
Income from investment operations:
Net investment income (2) ............................... 1.43 3.22 2.65
Net realized and unrealized gains or losses on investments (3) (.02) .06 (.39)
---------- ---------- ----------
Total income from investment operations 1.41 3.28 2.26
Less distributions from:
Net investment income ................................... - (1.84) (.67)
---------- ---------- ----------
Total distributions - (1.84) (.67)
---------- ---------- ----------
Net asset value, end of period $ 69.25 $ 67.84 $ 66.40
========== ========== ==========
Total return (4) ............................................. 2.08% 4.95% 3.49%
Ratios / supplemental data:
Net assets, end of period (in thousands) .................. $ 112,582 $ 114,667 $ 121,666
========== ========== ==========
Ratio of expenses to average net assets (2) ............... .83%* .82% .82%
Ratio of net investment income to average net assets ...... 4.21%* 4.79% 3.57%
<FN>
* Computed on an annualized basis.
(l) The Treasury Bill Portfolio commenced investment operations September 21,
1987.
(2) Due to the waiver of advisory fees and, effective January 1, 1991 through
January 31, 1994, distribution expenses, the ratio of expenses to average
net assets was reduced by .51% for the six months ended July 31, 1996 and
.50%, .50%, .49%, .47%, .48%, .47%, .62%, .62% and .65% for the years ended
January 31, 1996, 1995, 1994, 1993, 1992, 1991, 1990 and 1989 and the
period ended January 31, 1988, respectively. Without this waiver, the net
investment income per share would have been $1.19 for the six months
ended July 31, 1996 and $2.78, $2.12, $1.04, $1.28, $2.85, $3.85, $3.96,
$3.00 and $1.33 for the years and the period then ended.
(3) Per share net realized and unrealized gains or losses on investments may
not correspond with the change in aggregate unrealized gains and losses in
the Portfolio's securities because of the timing of sales and repurchases
of the Portfolio's shares in relation to fluctuating market values for the
Portfolio.
(4) Assumes reinvestment of all dividends and distributions, and deduction of
all fees and expenses except the $35 one-time account start-up fee and the
$1.50 monthly account maintenance fee.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Year ended Year ended Year ended Year ended Year ended Year ended Period ended
January 31, 1994 January 31, 1993 January 31, 1992 January 31, 1991 January 31, 1990 January 31, 1989 January 31, 1988(1)
- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- -------------------
<C> <C> <C> <C> <C> <C> <C>
$ 64.45 $ 64.99 $ 63.11 $ 59.35 $ 54.91 $ 51.54 $ 50.00
---------- ---------- ---------- ---------- --------- ---------- ----------
1.53 1.68 3.26 4.20 4.36 3.38 1.55
(.09) .19 (.08) (.01) .08 .02 (.01)
---------- ---------- ---------- ---------- --------- ---------- ----------
1.44 1.87 3.18 4.19 4.44 3.40 1.54
(1.08) (2.41) (1.30) (.43) - (.03) -
---------- ---------- ---------- ---------- --------- ---------- ----------
(1.08) (2.41) (1.30) (.43) - (.03) -
---------- ---------- ---------- ---------- --------- ---------- ----------
$ 64.81 $ 64.45 $ 64.99 $ 63.11 $ 59.35 $ 54.91 $ 51.54
========== ========== ========== ========== ========= ========== ==========
2.24% 2.89% 5.05% 7.06% 8.09% 6.60% 4.48%*
$ 133,970 $ 179,888 $ 320,382 $ 207,889 $ 61,056 $ 31,370 $ 6,475
========== ========== ========== ========== ========= ========== ==========
.72% .73% .73% .83% .54% .54% .50%*
2.46% 2.97% 4.87% 6.74% 7.87% 6.70% 5.32%*
</TABLE>
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE VERSATILE BOND PORTFOLIO
<TABLE>
Financial highlights for the Versatile Bond Portfolio
For each share of capital stock outstanding throughout each fiscal period:
<CAPTION>
Six months ended Year ended
July 31, 1996 January 31, 1996
(Unaudited)
---------------- ----------------
<S> <C> <C>
Net asset value, beginning of period $ 56.85 $ 54.90
-------- ---------
Income from investment operations:
Net investment income (2) ............... 1.51 2.91
Net realized and unrealized gains
or losses on investments (3) .......... (.48) 1.05
-------- ---------
Total income from investment operations 1.03 3.96
Less distributions from:
Net investment income ................... - (2.01)
Net realized gain on investments ........ - -
-------- ---------
Total distributions - (2.01)
-------- ---------
Net asset value, end of period $ 57.88 $ 56.85
======== =========
Total return (4) ............................ 1.81% 7.24%
Ratios / supplemental data:
Net assets, end of period (in thousands).... $ 19,047 $ 20,137
======== =========
Ratio of expenses to average net assets (2). .92%* .89%
Ratio of net investment income
to average net assets ................... 5.30%* 5.21%
Portfolio turnover rate ................... 122.57%* 51.64%
<FN>
* Computed on an annualized basis.
(l) The Versatile Bond Portfolio commenced investment operations November 12,
1991.
(2) Due to the waiver of advisory fees and through January 31, 1994,
distribution expenses, the ratio of expenses to average net assets was
reduced by .37% for the six months ended July 31, 1996 and .37%, .36%,
.39%, .41% and .43% for the years ended January 31, 1996, 1995, 1994, 1993
and the period ended January 31, 1992, respectively. Without this waiver,
the net investment income per share would have been $1.37 for the six
months ended July 31, 1996 and $2.65, $1.84, $1.57, $1.77 and $2.13 for the
years and the period then ended.
(3) Per share net realized and unrealized gains or losses on investments may
not correspond with the change in aggregate unrealized gains and losses in
the Portfolio's securities because of the timing of sales and repurchases
of the Portfolio's shares in relation to fluctuating market values for the
Portfolio.
(4) Assumes reinvestment of all dividends and distributions, and deduction of
all fees and expenses except the $35 one-time account start-up fee and the
$1.50 monthly account maintenance fee.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Year ended Year ended Year ended Period ended
January 31, 1995 January 31, 1994 January 31, 1993 January 31, 1992(1)
- ---------------- ---------------- ---------------- --------------------
<C> <C> <C> <C>
$ 54.76 $ 53.63 $ 50.58 $ 50.00
--------- --------- ---------- ---------
2.12 1.87 2.06 2.51
(.63) (.04) 1.00 (1.93)
--------- --------- ---------- ---------
1.49 1.83 3.06 .58
(1.33) (.70) (.01) -
(.02) - - -
--------- --------- ---------- ---------
(1.35) (.70) (.01) -
--------- --------- ---------- ---------
$ 54.90 $ 54.76 $ 53.63 $ 50.58
========= ========= ========== =========
2.74% 3.42% 6.05% 3.33%*
$ 22,229 $ 35,682 $ 23,217 $ 596
========= ========= ========== =========
.86% .89% .89% 1.07%*
3.84% 3.46% 3.86% 4.00%*
74.62% 75.05% 224.95% 600.99%*
</TABLE>
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE AGGRESSIVE GROWTH PORTFOLIO
<TABLE>
Financial highlights for the Aggressive Growth Portfolio
For each share of capital stock outstanding throughout each fiscal period:
<CAPTION>
Six months ended Year ended Year ended
July 31, 1996 January 31, 1996 January 31, 1995
(Unaudited)
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 40.65 $ 31.61 $ 32.56
--------- --------- ---------
Income from investment operations:
Net investment income (loss) ............................ .36 (.02) (.01)
Net realized and unrealized gains
or losses on investments ................................ (.84) 10.68 (.89)
--------- --------- ---------
Total income or loss from investment operations (.48) 10.66 (.90)
Less distributions from:
Net investment income ................................... - (.11) (.03)
Net realized gain on investments ........................ - (1.51) (.02)
--------- --------- ---------
Total distributions - (1.62) (.05)
--------- --------- ---------
Net asset value, end of period $ 40.17 $ 40.65 $ 31.61
========= ========= =========
Total return (2) ............................................. (1.18)% 33.78% (2.75)%
Ratios / supplemental data:
Net assets, end of period (in thousands) .................... $ 11,494 $ 11,067 $ 6,758
========= ========= =========
Ratio of expenses to average net assets ...................... 1.21%* 1.19% 1.23%
Ratio of net investment income (loss) to average net assets... 1.78%* (.06)% (.04)%
Portfolio turnover rate ...................................... 8.41%* 18.94% 26.29%
Average brokerage commission rate paid (3) ................... $ 0.0501 $ - $ -
<FN>
* Computed on an annualized basis.
(l) The Aggressive Growth Portfolio commenced investment operations May 16,
1990.
(2) Assumes reinvestment of all dividends and distributions, and deduction of
all fees and expenses except the $35 one-time account start-up fee and the
$1.50 monthly account maintenance fee.
(3) Average brokerage commission rate paid information was not required for
previous periods.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Year ended Year ended Year ended Period ended
January 31, 1994 January 31, 1993 January 31, 1992 January 31, 1991(1)
---------------- ---------------- ---------------- -------------------
<C> <C> <C> <C>
$ 26.63 $ 22.77 $ 18.35 $ 20.00
--------- --------- ---------- ---------
.01 .02 .06 .13
6.41 4.44 4.38 (1.78)
--------- --------- ---------- ---------
6.42 4.46 4.44 (1.65)
(.02) (.13) (.02) -
(.47) (.47) - -
--------- --------- ---------- ---------
(.49) (.60) (.02) -
--------- --------- ---------- ---------
$ 32.56 $ 26.63 $ 22.77 $ 18.35
========= ========= ========== =========
24.25% 19.77% 24.21% (8.25)%*
$ 7,201 $ 3,596 $ 2,577 $ 1,151
========= ========= ========== =========
1.20% 1.12% 1.18% 1.07%*
.02% .12% .23% .64%*
29.83% 25.62% 53.18% 36.88%*
$ - $ - $ - $ -
</TABLE>
<PAGE>
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<PAGE>
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<PAGE>
INVESTMENT ADVISER The
World Money Managers PERMANENT
Terry Coxon, General Partner PORTFOLIO
625 Second Street Family of Funds
Petaluma, California 94952
CONSULTANTS TO THE FUND
Harry Browne
Douglas Casey
TRANSFER AGENT
Chase Global Funds Services Company
P.O. Box 2798
Boston, Massachusetts 02208
(for overnight delivery services,
73 Tremont Street
Boston, Massachusetts 02108)
1-800-341-8900
In Mass. 1-617-557-8000
CUSTODIAN
State Street Bank and Trust Company
Boston, Massachusetts 02105
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP
Three Embarcadero Center
San Francisco, California 94111
INVESTOR'S INFORMATION OFFICE
P.O. BOX 5847 SEMI-ANNUAL
Austin, Texas 78763 REPORT
1-800-531-5142 Nationwide July 31, 1996
Local 1-512-453-7558
