PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
SEMI-ANNUAL REPORT FOR THE SIX MONTHS ENDED JULY 31, 1997
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
July 31, 1997
(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 .........................................
Corporate bonds .............................................................
United States Treasury securities ...........................................
Total investments (identified cost $66,903,013; $97,186,435; $22,767,591
and $11,129,091, respectively)
Cash ..........................................................................
Accounts receivable for shares of the portfolio 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 .........................
Accrued investment advisory fee ...............................................
Accrued directors' and officers' 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 - 3,770,042; 1,433,536; 394,600 and 323,591 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 of investments .....................................
Net unrealized depreciation 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>
$ 14,182,500 $ - $ - $ -
3,695,166 - - -
924,142 - - -
------------ ------------ ------------- ------------
18,801,808 - - -
5,873,965 - - -
11,613,193 - - -
12,213,718 - - 18,762,199
509,993 - 22,868,925 -
22,987,014 97,186,688 - 379,693
------------ ------------ ------------- ------------
71,999,691 97,186,688 22,868,925 19,141,892
142,231 1,007 - -
- 43,961 855 27,073
306,336 1,615,876 387,660 2,574
90,594 92,030 - 7,816
------------ ------------ ------------- ------------
72,538,852 98,939,562 23,257,440 19,179,355
- - 15,200 115,410
- 60,913 6,696 126,543
- - 3,555 -
8,840 15,313 2,280 778
38,896 73,938 11,112 2,016
------------ ------------ ------------- ------------
47,736 150,164 38,843 244,747
------------ ------------ ------------- ------------
$ 72,491,116 $ 98,789,398 $ 23,218,597 $ 18,934,608
============ ============ ============= ============
$ 3,770 $ 1,434 $ 395 $ 324
56,560,753 96,412,467 21,463,112 9,876,618
------------ ------------ ------------- ------------
56,564,523 96,413,901 21,463,507 9,876,942
7,553,199 2,525,127 1,795,750 54,156
3,305,856 (149,883) (141,994) 990,709
10,793 - - -
5,096,678 253 101,334 8,012,801
(39,933) - - -
------------ ------------ ------------- ------------
$ 72,491,116 $ 98,789,398 $ 23,218,597 $ 18,934,608
============ ============ ============= ============
$19.23 $68.91 $58.84 $58.51
====== ====== ====== ======
</TABLE>
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
STATEMENTS OF OPERATIONS
Six months ended July 31, 1997
(Unaudited)
Investment income:
Interest ....................................................................
Dividends ...................................................................
Expenses (Notes 3 & 8):
Investment advisory fee .....................................................
Directors' fees and expenses ................................................
Officers' salary expense ....................................................
Excise tax ..................................................................
Regulatory expense ..........................................................
Total expenses
Less waiver of investment advisory fee ......................................
Net expenses
Net investment income (loss) before foreign income taxes deducted at source
Less foreign income taxes deducted at source, net of refundable taxes .........
Net investment income (loss)
Realized and unrealized gain 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 gain on investments
and foreign currency
Net increase 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>
$ 1,113,144 $ 2,595,531 $ 650,289 $ 6,652
309,103 - - 67,217
------------ ------------ ------------- ------------
1,422,247 2,595,531 650,289 73,869
395,819 566,736 123,227 89,861
18,336 26,156 5,642 4,163
31,286 45,187 9,159 6,604
38,896 73,938 11,112 2,016
150,000 135,000 - 15,000
------------ ------------ ------------- ------------
634,337 847,017 149,140 117,644
- 252,226 41,825 -
------------ ------------ ------------- ------------
634,337 594,791 107,315 117,644
------------ ------------ ------------- ------------
787,910 2,000,740 542,974 (43,775)
7,528 - - -
------------ ------------ ------------- ------------
780,382 2,000,740 542,974 (43,775)
------------ ------------ ------------- ------------
2,011,417 3,083 (15,177) -
- - - -
------------ ------------ ------------- ------------
2,011,417 3,083 (15,177) -
263,552 (2,820) 75,764 3,563,511
8,073 - - -
------------ ------------ ------------- ------------
2,283,042 263 60,587 3,563,511
------------ ------------ ------------- ------------
$ 3,063,424 $ 2,001,003 $ 603,561 $ 3,519,736
============ ============ ============= ============
</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, 1997 January 31, 1997
(Unaudited)
---------------- ----------------
<S> <C> <C>
Operations:
Net investment income (loss) .............................................. $ 780,382 $ 2,083,023
Net realized gain (loss) on investments ................................... 2,011,417 1,296,441
Net realized gain on foreign currency transactions ........................ - 10,793
Change in unrealized appreciation (depreciation) of investments ........... 263,552 (2,950,852)
Change in unrealized appreciation (depreciation) on translation of
assets and liabilities in foreign currencies ........................... 8,073 (56,724)
------------ ------------
Net increase in net assets resulting from operations 3,063,424 382,681
Equalization on shares issued and redeemed: ................................. (375,123) (249,430)
Distributions to shareholders from:
Net investment income ..................................................... - (1,647,665)
Net realized gain on investments .......................................... - (352,938)
Capital stock transactions exclusive of amounts allocated to undistributed
net investment income (Note 6): ........................................... (3,188,708) (1,781,916)
------------ ------------
Net increase (decrease) in net assets (500,407) (3,649,268)
Net assets at beginning of period 72,991,523 76,640,791
------------ ------------
Net assets at end of period (including undistributed net investment income
of $7,553,199 and $7,322,418; $2,525,127 and $2,263,201; $1,795,750 and
$1,556,933; $54,156 and $122,708, respectively) $ 72,491,116 $ 72,991,523
============ ============
</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, 1997 January 31, 1997 July 31, 1997 January 31, 1997 July 31, 1997 January 31, 1997
(Unaudited) (Unaudited) (Unaudited)
- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
<C> <C> <C> <C> <C> <C>
$ 2,000,740 $ 4,677,086 $ 542,974 $ 1,024,523 $ (43,775) $ 77,145
3,083 (2,228) (15,177) 9,404 - 992,038
- - - - - -
(2,820) (55,884) 75,764 (148,138) 3,563,511 1,106,794
- - - - - -
------------ ------------- ------------ ------------ ----------- -----------
2,001,003 4,618,974 603,561 885,789 3,519,736 2,175,977
(358,142) (1,052,143) 153,463 16,284 205 34,901
- (4,430,015) - (699,991) - (86,850)
- - - - - (17,370)
(8,194,998) (8,462,596) 1,116,632 1,005,692 (2,672) 2,244,098
------------ ------------- ------------ ------------ ----------- -----------
(6,552,137) (9,325,780) 1,873,656 1,207,774 3,517,269 4,350,756
105,341,535 114,667,315 21,344,941 20,137,167 15,417,339 11,066,583
------------ ------------- ------------ ------------ ----------- -----------
$ 98,789,398 $ 105,341,535 $ 23,218,597 $ 21,344,941 $18,934,608 $15,417,339
============ ============= ============ ============ =========== ===========
</TABLE>
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Quantity Market Value
- ----------------- ------------
<C> <S> <C>
GOLD ASSETS - 19.56% of Total Net Assets
11,997 Troy Oz. Gold bullion (a) ......................................................... $ 3,888,312
30,683 Coins One-ounce gold coins (a) .................................................. 10,238,917
4,297 Units United States Gold Trust (a)(b) ........................................... 55,271
------------
Total Gold Assets (Cost $17,020,994) $ 14,182,500
------------
SILVER ASSETS - 5.10% of Total Net Assets
573,493 Troy Oz. Silver bullion (a) ........................................................ $ 2,562,941
379 Bags Silver coins (a) .......................................................... 1,132,225
------------
Total Silver Assets (Cost $5,225,549) $ 3,695,166
------------
</TABLE>
<TABLE>
<CAPTION>
Principal Amount SWISS FRANC ASSETS - 9.38% of Total Net Assets
- ----------------
<C> <S> <C>
CHF 1,399,244 Swiss francs in interest-bearing bank accounts ............................ $ 924,142
------------
CHF 3,700,000 5.250% Swiss Confederation bonds, 02-11-98 ................................ 2,490,615
CHF 4,000,000 4.000% Swiss Confederation bonds, 03-10-99 ................................ 2,746,186
CHF 820,000 7.000% Swiss Confederation bonds, 07-09-01 ................................ 637,164
------------
Total Swiss Confederation bonds 5,873,965
------------
Total Swiss Franc Assets (Cost $7,182,260) $ 6,798,107
------------
</TABLE>
<TABLE>
<CAPTION>
Number STOCKS OF UNITED STATES AND FOREIGN REAL ESTATE AND NATURAL
Of Shares RESOURCE COMPANIES - 16.02% of Total Net Assets
---------
<C> <S> <C>
NATURAL RESOURCES - 5.69% of Total Net Assets
14,300 Broken Hill Proprietary, Ltd. (c) ......................................... $ 383,419
12,000 Burlington Resources, Inc. ................................................ 567,000
17,200 Cyprus Amax Minerals Company ............................................. 436,450
26,600 Forest Oil Corporation (a) ................................................ 382,375
15,200 Inco, Ltd. ................................................................ 470,250
12,791 Monterey Resources, Inc. .................................................. 195,065
20,000 Pogo Producing Company .................................................... 817,500
29,000 Santa Fe Energy Resources, Inc. (a) ...................................... 250,125
10,000 Weyerhaeuser Company ..................................................... 622,500
------------
$ 4,124,684
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
REAL ESTATE - 10.33% of Total Net Assets
25,000 BRE Properties, Inc. Class A .............................................. $ 637,500
31,000 Burnham Pacific Properties, Inc. .......................................... 441,750
23,500 Federal Realty Investment Trust ........................................... 622,750
29,000 HRE Properties ............................................................ 523,813
47,000 IRT Property Company ...................................................... 602,188
28,000 MGI Properties ............................................................ 617,750
21,000 New Plan Realty Trust ..................................................... 479,063
20,100 Pennsylvania Real Estate Investment Trust ................................. 502,500
27,500 Security Capital Pacific Trust ............................................ 629,063
18,000 Texas Pacific Land Trust .................................................. 720,000
47,200 United Dominion Realty Trust, Inc. ........................................ 672,600
31,900 Washington Real Estate Investment Trust ................................... 538,313
37,300 Western Investment Real Estate Trust ...................................... 501,219
-----------
$ 7,488,509
-----------
Total Stocks of United States and Foreign Real Estate and Natural
Resource Companies (Cost $6,937,270) $11,613,193
-----------
AGGRESSIVE GROWTH STOCK INVESTMENTS - 16.85% of Total Net Assets
CHEMICALS - .49% of Total Net Assets
4,000 Air Products & Chemicals, Inc. ........................................... $ 352,750
-----------
$ 352,750
COMPUTER SOFTWARE - 1.59% of Total Net Assets
7,000 Autodesk, Inc. ........................................................... $ 296,625
1 Symantec Corporation warrant (a)(d) ...................................... 856,895
-----------
$ 1,153,520
CONSTRUCTION - .21% of Total Net Assets
2,500 Fluor Corporation ........................................................ $ 153,750
-----------
$ 153,750
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
DATA PROCESS1NG - .94% of Total Net Assets
5,000 Hewlett-Packard Company ................................................... $ 350,313
8,000 Seagate Technology, Inc. (a) ............................................. 328,500
----------
$ 678,813
ELECTRICAL AND ELECTRONICS - 1.81% of Total Net Assets
12,000 DSC Communications Corporation (a) ....................................... $ 354,000
7,000 Intel Corporation ........................................................ 642,688
10,000 National Semiconductor Corporation (a) .................................... 315,000
----------
$1,311,688
ENTERTAINMENT AND LEISURE - 1.82% of Total Net Assets
2,500 The Walt Disney Company .................................................. $ 202,031
4,500 Harcourt General, Inc. ................................................... 212,625
16,000 Harrah's Entertainment, Inc. (a) ......................................... 328,000
9,000 Promus Hotel Corporation (a) .............................................. 353,813
4,200 Tribune Company .......................................................... 222,338
----------
$1,318,807
FINANCIAL SERVICES - 2.84% of Total Net Assets
3,000 Bank of New York, Inc. warrants (a) ..................................... $ 402,750
6,851 Bank of Petaluma (a) ...................................................... 156,717
7,000 Bear Stearns Companies, Inc. ............................................. 285,688
6,600 Morgan Stanley, Dean Witter, Discover & Company .......................... 345,263
9,000 The Charles Schwab Corporation ........................................... 421,313
8,000 State Street Corporation ................................................. 448,500
----------
$2,060,231
MANUFACTURING - 3.14% of Total Net Assets
23,000 Collins Industries, Inc. warrants (a) .................................... $ 719
8,000 Harley-Davidson, Inc. ..................................................... 426,000
5,100 Harnischfeger Industries, Inc. ............................................ 219,938
7,000 Illinois Tool Works, Inc. ................................................ 363,125
9,000 Mattel, Inc. ............................................................. 312,750
2,000 NACCO Industries, Inc. Class A ........................................... 138,750
8,000 NACCO Industries, Inc. Class B ........................................... 555,000
4,000 Parker-Hannifin Corporation .............................................. 257,500
----------
$2,273,782
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
OIL AND OILFIELD SERVICES - .67% of Total Net Assets
20,000 Parker Drilling Company (a) ............................................... $ 261,250
48,200 Wainoco Oil Corporation (a) ............................................... 222,925
-----------
$ 484,175
PHARMACEUTICALS - .97% of Total Net Assets
5,000 Abbott Laboratories ....................................................... $ 327,188
2,400 Biogen, Inc. (a) .......................................................... 92,400
10,000 Genzyme Corporation (General Division) (a) ................................ 272,500
1,245 Genzyme Corporation Tissue Repair (a) ..................................... 13,539
-----------
$ 705,627
RETAIL - .62% of Total Net Assets
12,000 Costco Companies, Inc. (a) ................................................ $ 454,500
-----------
$ 454,500
TRANSPORTATION - .96% of Total Net Assets
12,300 ASA Holdings, Inc. ........................................................ $ 347,475
4,600 Kansas City Southern Industries, Inc. ..................................... 346,725
-----------
$ 694,200
MISCELLANEOUS - .79% of Total Net Assets
3,600 Lockheed Martin Corporation ............................................... $ 383,400
2,800 Temple-Inland, Inc. ....................................................... 188,475
-----------
$ 571,875
-----------
Total Aggressive Growth Stock Investments (Cost $3,853,327) $12,213,718
-----------
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
DOLLAR ASSETS - 32.41% of Total Net Assets
CORPORATE BONDS - .70% of Total Net Assets
$ 100,000 8.750% Dillard Department Stores, Inc., 06-15-98 .......................... $ 102,573
100,000 8.300% Hertz Corporation, 02-02-98 ........................................ 101,369
100,000 9.000% Philip Morris Companies, Inc., 05-15-98 ............................ 102,530
100,000 6.750% USLIFE Corporation, 01-15-98 ....................................... 100,552
100,000 9.375% Virginia Electric & Power Company, 06-01-98 ........................ 102,969
------------
$ 509,993
UNITED STATES TREASURY SECURITIES - 31.71% of Total Net Assets
41,000,000 United States Treasury bond strips (Principal only) 6.500%, 05-15-18(e) ... $ 10,836,300
800,000 United States Treasury bonds 6.250%, 08-15-23 ............................ 788,704
3,000,000 United States Treasury notes 5.625%, 01-31-98 ............................ 3,001,770
2,000,000 United States Treasury notes 5.875%, 01-31-99 ............................ 2,006,640
3,000,000 United States Treasury notes 7.750%, 01-31-00 ............................ 3,137,580
750,000 United States Treasury bills 4.110%, 08-07-97 (e) ........................ 749,400
2,600,000 United States Treasury bills 5.450%, 07-23-98 (e)(g) ...................... 2,466,620
------------
$ 22,987,014
------------
Total Dollar Assets (Cost $26,683,613) $ 23,497,007
------------
Total Portfolio - 99.32% of total net assets (identified cost $66,903,013)(f) $ 71,999,691
Other assets, less liabilities (.68% of total net assets) 491,425
------------
Net assets applicable to outstanding shares $ 72,491,116
============
<FN>
Note:(a) Non-income producing.
(b) Affiliated investment trust.
(c) Sponsored ADR.
(d) Market value determined by the Board of Directors.
(e) Interest rate represents yield to maturity.
(f) Aggregate cost for Federal income tax purposes was $59,837,625.
(g) Collateral supporting line of credit(see Note 7).
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE TREASURY BILL PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
UNITED STATES TREASURY SECURITIES - 98.38% of Total Net Assets
$22,000,000 United States Treasury notes 6.000%, 08-31-97 ............................. $ 22,007,700
26,600,000 United States Treasury notes 5.750%, 09-30-97 ............................. 26,620,748
22,000,000 United States Treasury notes 5.625%, 10-31-97 ............................. 22,015,180
26,000,000 United States Treasury notes 5.375%, 11-30-97 ............................. 25,993,500
550,000 United States Treasury bills 4.110%, 08-07-97 (a) ......................... 549,560
-------------
Total Portfolio - 98.38% of total net assets (identified cost $97,186,435)(b) $ 97,186,688
Other assets, less liabilities (1.62% of total net assets) 1,602,710
-------------
Net assets applicable to outstanding shares $ 98,789,398
=============
<FN>
Note:(a) Interest rate represents yield to maturity.
(b) 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, 1997
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
CORPORATE BONDS - 98.49% of Total Net Assets
BEVERAGES - 8.81% of Total Net Assets
$1,000,000 7.875% Coca Cola Company, 09-15-98 ....................................... $ 1,024,260
1,000,000 7.625% PepsiCo, Inc., 11-01-98 ............................................ 1,022,260
------------
$ 2,046,520
ELECTRIC UTILITIES - 12.26% of Total Net Assets
900,000 5.000% Gulf Power Company, 07-01-98 ...................................... $ 895,059
1,000,000 7.500% Southern California Edison Company, 04-15-99 ....................... 1,024,900
900,000 9.375% Virginia Electric & Power Company, 06-01-98 ........................ 926,721
------------
$ 2,846,680
ELECTRICAL AND ELECTRONICS - 8.77% of Total Net Assets
1,000,000 7.875% General Electric Company, 09-15-98 ................................. $ 1,024,280
1,000,000 6.750% Texas Instruments, Inc., 07-15-99 .................................. 1,013,080
------------
$ 2,037,360
FINANCIAL SERVICES - 13.09% of Total Net Assets
1,000,000 8.500% American General Finance Corporation, 06-15-99 ..................... $ 1,043,310
1,000,000 5.250% Associates Corporation of North America, 09-01-98 ................. 995,860
1,000,000 5.750% International Lease Finance Company, 01-15-99 ...................... 999,760
------------
$ 3,038,930
INSURANCE - 12.83% of Total Net Assets
1,000,000 9.000% SunAmerica, Inc., 01-15-99 ........................................ $ 1,042,750
1,000,000 7.750% Travelers Group, Inc., 06-15-99 .................................... 1,031,190
900,000 6.750% USLIFE Corporation, 01-15-98 ...................................... 904,968
------------
$ 2,978,908
MANUFACTURING - 4.34% OF Total Net Assets
1,000,000 6.375% Eaton Corporation, 04-01-99 ........................................ $ 1,007,400
------------
$ 1,007,400
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE VERSATILE BOND PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
NATURAL GAS UTILITIES - 4.32% of Total Net Assets
$1,000,000 5.875% Consolidated Natural Gas Company, 10-01-98 ........................ $ 1,002,890
------------
$ 1,002,890
OIL AND OILFIELD SERVICES - 8.79% of Total Net Assets
1,000,000 7.625% Baker Hughes, Inc., 02-15-99 ...................................... $ 1,025,380
1,000,000 6.950% Shell Oil Company, 12-15-98 ...................................... 1,016,160
------------
$ 2,041,540
PHARMACEUTICALS - 4.37% of Total Net Assets
1,000,000 8.625% McKesson Corporation, 02-01-98 ..................................... $ 1,015,160
------------
$ 1,015,160
RETAIL - 8.28% of Total Net Assets
900,000 8.750% Dillard Department Stores, Inc., 06-15-98 ......................... $ 923,157
1,000,000 5.500% Wal-Mart Stores, Inc., 03-01-98 ................................... 1,000,000
------------
$ 1,923,157
TELECOMMUNICATIONS - 8.65% of Total Net Assets
1,000,000 6.125% GTE Northwest, 02-15-99 ............................................ $ 1,004,500
1,000,000 6.250% New England Telephone & Telegraph Company, 12-15-97 ............... 1,003,110
------------
$ 2,007,610
TOBACCO - 3.98% of Total Net Assets
900,000 9.000% Philip Morris Companies, Inc., 05-15-98 ........................... $ 922,770
------------
$ 922,770
------------
Total Portfolio - 98.49% of total net assets (identified cost $22,767,591)(a) $ 22,868,925
Other assets, less liabilities (1.51% of total net assets) 349,672
------------
Net assets applicable to outstanding shares $ 23,218,597
============
<FN>
Note: (a) Aggregate cost for Federal income tax purposes.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE AGGRESSIVE GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
AGGRESSIVE GROWTH STOCK INVESTMENTS - 99.09% of Total Net Assets
CHEMICALS - 4.93% of Total Net Assets
6,000 Air Products & Chemicals, Inc. ............................................ $ 529,125
17,800 Wellman, Inc. ............................................................. 404,950
----------
$ 934,075
COMPUTER SOFTWARE - 5.58% of Total Net Assets
14,800 Autodesk, Inc. ............................................................ $ 627,150
6,300 Computer Associates International, Inc. ................................... 428,794
----------
$1,055,944
CONSTRUCTION - 4.96% of Total Net Assets
5,900 Fluor Corporation ......................................................... $ 362,850
13,000 Johns Manville Corporation ............................................... 157,625
25,400 Ryland Group, Inc. ........................................................ 419,100
----------
$ 939,575
DATA PROCESSING - 6.27% of Total Net Assets
69,827 AST Research, Inc. (a) .................................................... $ 360,044
9,800 Hewlett-Packard Company ................................................... 686,613
3,400 Seagate Technology, Inc. (a) ............................................. 139,613
----------
$1,186,270
ELECTRICAL AND ELECTRONICS - 7.15% of Total Net Assets
22,200 DSC Communications Corporation (a) ........................................ $ 654,900
2,400 Intel Corporation ........................................................ 220,350
15,200 National Semiconductor Corporation (a) .................................... 478,800
----------
$1,354,050
ENTERTAINMENT AND LEISURE - 8.03% of Total Net Assets
5,300 The Walt Disney Company ................................................... $ 428,306
7,500 Harcourt General, Inc. .................................................... 354,375
9,600 Tribune Company .......................................................... 508,200
7,500 Viacom, Inc. Class A (a) .................................................. 229,219
----------
$1,520,100
FINANCIAL SERVICES - 15.04% of Total Net Assets
2,600 Bank of New York, Inc. warrants (a) ...................................... $ 349,050
16,182 Bear Stearns Companies, Inc. .............................................. 660,428
9,240 Morgan Stanley, Dean Witter, Discover & Company ........................... 483,368
15,300 The Charles Schwab Corporation ............................................ 716,231
11,400 State Street Corporation .................................................. 639,113
----------
$2,848,190
MANUFACTURING - 11.41% of Total Net Assets
8,400 Dana Corporation ......................................................... $ 381,675
6,900 Harnischfeger Industries, Inc. ............................................ 297,563
8,600 Illinois Tool Works, Inc. ................................................. 446,125
12,583 Mattel, Inc. .............................................................. 437,259
9,300 Parker-Hannifin Corporation ............................................... 598,688
----------
$2,161,310
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE AGGRESSIVE GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1997
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
OIL AND OILFIELD SERVICES - 5.52% of Total Net Assets
42,700 Parker Drilling Company (a) .............................................. $ 557,769
105,200 Wainoco Oil Corporation (a) ............................................... 486,550
-----------
$ 1,044,319
PHARMACEUTICALS - 8.18% of Total Net Assets
6,400 Amgen, Inc. (a) .......................................................... $ 376,400
11,000 Biogen, Inc. (a) .......................................................... 423,500
19,500 Chiron Corporation (a) .................................................... 409,500
12,000 Genzyme Corporation (General Division) (a) ................................ 327,000
1,170 Genzyme Corporation Tissue Repair (a) .................................... 12,724
-----------
$ 1,549,124
RETAIL - 5.38% of Total Net Assets
15,200 Costco Companies, Inc. (a) ................................................ $ 575,700
13,000 Toys "R" Us, Inc. (a) ..................................................... 442,813
-----------
$ 1,018,513
TRANSPORTATION - 8.71% of Total Net Assets
11,700 ASA Holdings, Inc. ........................................................ $ 330,525
8,600 Kansas City Southern Industries, Inc. ..................................... 648,225
20,100 M.S. Carriers, Inc. (a) ................................................... 464,813
37,500 Mesa Air Group, Inc. (a) ................................................. 206,250
-----------
$ 1,649,813
MISCELLANEOUS - 7.93% of Total Net Assets
13,000 Browning-Ferris Industries, Inc. .......................................... $ 481,000
5,500 Lockheed Martin Corporation .............................................. 585,750
6,450 Temple-Inland, Inc. ....................................................... 434,166
-----------
$ 1,500,916
-----------
Total Aggressive Growth Stock Investments (Cost $10,749,398) $18,762,199
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal Amount
- ----------------
UNITED STATES TREASURY SECURITIES - 2.00% of Total Net Assets
<C> <S> <C>
$ 380,000 United States Treasury bills 4.110%, 08-07-97 (b) ......................... $ 379,693
-----------
Total United States Treasury Securities (Cost $379,693) $ 379,693
-----------
Total Portfolio - 101.09% of total net assets (identified cost $11,129,091)(c) $19,141,892
Liabilities, less other assets (1.09% of total net assets) (207,284)
-----------
Net assets applicable to outstanding shares $18,934,608
===========
<FN>
Note:(a) Non-income producing.
(b) Interest rate represents yield to maturity.
(c) 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, 1997
(Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES
Permanent Portfolio Family of Funds, Inc. (the "Fund") is registered under
the Investment Company Act of 1940, as amended (the "Act"), 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, 1997, one such investment in the Permanent Portfolio
(1.18% of total net assets) was 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, 1997, 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 $ 24,982 $ - $ 588,829 $ -
Swiss franc assets 115,998 - - -
United States Treasury securities 961,586 2,564,915 48,375 289
Other investments 10,578 30,616 13,085 6,363
Dividends 309,103 - - 67,217
------------ ------------ ------------ -----------
Total $ 1,422,247 $ 2,595,531 $ 650,289 $ 73,869
============ ============ ============ ===========
</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, 1997; 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, 1997
(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 gains or losses on foreign
currency transactions 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 currency gains or losses arise from changes in
the exchange rate applicable to cash, receivables and liabilities
denominated in foreign currencies at July 31, 1997.
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, 1997,
pursuant to the requirements of the Code.
At July 31, 1997, capital loss carryforwards available to offset future
realized gains, if any, aggregate approximately: $153,000 in the Treasury
Bill Portfolio, of which $4,000, $99,000, $41,000, $5,000 and $4,000 expire
on January 31, 2001, January 31, 2002, January 31, 2003, January 31, 2004
and January 31, 2005, respectively; and $124,000 in the Versatile Bond
Portfolio, of which $90,000 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.
Pursuant to the Code, 43.14% and 100.00% of the distributions made from
investment company taxable income in 1996 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 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
realized gains on certain investment securities held by the Fund's
Portfolios. During the six months ended July 31, 1997, the Fund
reclassified from undistributed net investment income to paid-in capital,
certain book and tax basis differences relating to shareholder
distributions, totaling $174,478, $1,380,672, $457,620 and $24,982 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, 1997
(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
The Permanent Portfolio held 4,297 units of United States Gold Trust, an
affiliated investment trust, resulting in net unrealized depreciation of
$10,675 at July 31, 1997. The Permanent Portfolio received no income from
this investment during the six months then ended.
3. INVESTMENT ADVISORY CONTRACT
In accordance with the terms of an Investment Advisory Contract (the
"Contract"), World Money Managers ("WMM"), the Fund's investment adviser,
receives a comprehensive advisory fee monthly, 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.
All fees and expenses payable by the Fund pursuant to the Contract and
attributable only to one 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, the salary expense of
the Fund's officers, 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.
During the six months ended July 31, 1997, WMM voluntarily agreed to waive
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. WMM may continue voluntarily to waive such fees, although it is not
required to do so, and reserves the right to revoke, reduce or change the
waiver prospectively upon five days written notice to the Fund.
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.
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1997
(Unaudited)
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, 1997:
<TABLE>
<CAPTION>
Permanent Treasury Bill Versatile Bond Aggressive Growth
Portfolio Portfolio Portfolio Portfolio
----------- ------------- -------------- -----------------
<S> <C> <C> <C> <C>
Purchases................................ $ 3,999,385 None $10,161,080 $ 354,598
Sales.................................... 5,338,921 None 10,291,709 -
</TABLE>
5. NET UNREALIZED APPRECIATION OF INVESTMENTS
<TABLE>
The following is a summary of net unrealized appreciation of investments at
July 31, 1997 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 .................... $ 17,218,268 $ 7,119 $ 102,248 $ 8,268,034
------------- --------- ---------- -----------
17,218,268 7,119 102,248 8,268,034
Aggregate gross unrealized depreciation
of investments with excess of tax
cost over value:
Investments in securities of unaffiliated
issuers ................................. (577,099) (6,866) (914) (255,233)
Investments other than securities........ (4,479,103) - - -
------------- --------- ---------- -----------
(5,056,202) (6,866) (914) (255,233)
------------- --------- ---------- -----------
Net unrealized appreciation
of investments $ 12,162,066 $ 253 $ 101,334 $ 8,012,801
============= ========= ========== ===========
</TABLE>
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1997
(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, 1997 Year ended January 31, 1997
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 126,801 $ 2,114,267 437,736 $ 7,182,111
Distributions reinvested......... - - 99,400 1,837,906
--------- ------------ ---------- ------------
126,801 2,114,267 537,136 9,020,017
Shares redeemed.................. (322,747) (5,302,975) (647,681) (10,801,933)
--------- ------------ ---------- ------------
Net decrease (195,946) $ (3,188,708) (110,545) $ (1,781,916)
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Treasury Bill Portfolio
---------------------------------------------------------------------------------
Six months ended July 31, 1997 Year ended January 31, 1997
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 214,588 $ 14,032,361 763,237 $ 49,387,677
Distributions reinvested......... - - 61,755 4,149,954
--------- ------------ ---------- ------------
214,588 14,032,361 824,992 53,537,631
Shares redeemed.................. (340,421) (22,227,359) (955,791) (62,000,227)
--------- ------------ ---------- ------------
Net decrease (125,833) $ (8,194,998) (130,799) $ (8,462,596)
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Versatile Bond Portfolio
---------------------------------------------------------------------------------
Six months ended July 31, 1997 Year ended January 31, 1997
---------------------------------------- --------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- -----------------
<S> <C> <C> <C> <C>
Shares sold...................... 107,951 $ 5,581,946 337,677 $ 17,383,088
Distributions reinvested......... - - 11,742 670,356
--------- ------------ ---------- ------------
107,951 5,581,946 349,419 18,053,444
Shares redeemed.................. (86,225) (4,465,314) (330,784) (17,047,752)
--------- ------------ ---------- ------------
Net increase 21,726 $ 1,116,632 18,635 $ 1,005,692
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Aggressive Growth Portfolio
---------------------------------------------------------------------------------
Six months ended July 31, 1997 Year ended January 31, 1997
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 92,249 $ 4,433,556 159,742 $ 6,989,548
Distributions reinvested......... - - 2,099 98,304
--------- ------------ ---------- ------------
92,249 4,433,556 161,841 7,087,852
Shares redeemed.................. (92,177) (4,436,228) (110,561) (4,843,754)
--------- ------------ ---------- ------------
Net increase (decrease) 72 $ (2,672) 51,280 $ 2,244,098
========= ============ ========== ============
</TABLE>
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1997
(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% 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, 1997, there were no amounts outstanding under
this agreement.
8. REGULATORY MATTERS
Following a routine examination of the Fund in 1991, the Securities and
Exchange Commission (the "Commission") instituted public administrative and
cease-and-desist proceedings on January 13, 1997, to determine the truth of
allegations by the Commission's Division of Enforcement (the "Division")
that WMM and two of the Fund's directors and officers (the "Respondents")
violated certain provisions of federal securities laws in fiscal years 1990
through 1992. The allegations include the following: that WMM, Terry Coxon
and Alan Sergy violated Section 206 of the Investment Advisers Act of 1940,
as amended, through conduct that included improper self-dealing at the
expense of the Fund; that WMM received excessive reimbursements under the
Fund's Marketing and Distribution Plan (the "Marketing Plan") during the
fiscal year ended January 31, 1991; that during fiscal years 1990 through
1992, the Fund's Board of Directors did not meet at the end of each quarter
to review the expenses incurred under the Marketing Plan and that the
reports thereon contained insufficient detail; and in April 1990, the
Permanent Portfolio acquired a "call option" prohibited by the Fund's
fundamental investment policies and managed the investment for the
advantage of a client of an officer of the Fund. No charges have been made
against the Fund. The Respondents have denied all of the allegations of the
Division and are contesting the proceedings. From May 5, 1997 through May
15, 1997, an administrative hearing on these charges was held before Chief
Administrative Law Judge Brenda P. Murray in San Francisco, California.
Thereafter, the Division and Respondents submitted post-hearing briefs and
the matter is currently under submission for decision. Pursuant to Maryland
law and the Fund's bylaws, the Fund has agreed to continue to pay directly
on behalf of the Respondents, or to reimburse them, for certain expenses
incurred by them in connection with the proceedings. The Fund's Permanent
Portfolio, Treasury Bill Portfolio and Aggressive Growth Portfolio so paid
or reimbursed expenses of $150,000, $135,000 and $15,000, respectively,
during the six months ended July 31, 1997.
<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, 1997 January 31, 1997 January 31, 1996 January 31, 1995
(Unaudited)
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 18.40 $ 18.80 $ 16.51 $ 17.55
--------- --------- --------- --------
Income or loss from investment operations:
Net investment income ................ .21 .52 .50 .64
Net realized and unrealized gains
or losses on investments and
foreign currencies ................ .62 (.41) 2.17 (1.46)
--------- --------- --------- --------
Total income or loss from
investment operations .83 .11 2.67 (.82)
Less distributions from:
Net investment income ................ - (.42) (.38) (.22)
Net realized gain on investments ..... - (.09) - -
--------- --------- --------- --------
Total distributions - (.51) (.38) (.22)
--------- --------- --------- --------
Net asset value, end of period $ 19.23 $ 18.40 $ 18.80 $ 16.51
========= ========= ========= ========
Total return (1) ......................... 4.51% .57% 16.20% (4.65)%
Ratios / supplemental data:
Net assets, end of period (in thousands)... $ 72,491 $ 72,992 $ 76,641 $ 71,610
========= ========= ========= ========
Ratio of expenses to average net assets.. 1.81%* 1.49% 1.35% 1.32%
Ratio of net investment income
to average net assets ................ 2.20%* 2.78% 2.85% 2.63%
Portfolio turnover rate ................. 17.91%* 12.29% 9.96% 31.24%
Average brokerage commission
rate paid (2) ........................ $ .0524 $ .0587 $ - $ -
<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
years beginning before September 1, 1995.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Year ended Year ended Year ended Year ended Year ended Year ended Year ended
January 31, 1994 January 31, 1993 January 31, 1992 January 31, 1991 January 31, 1990 January 31, 1989 January 31, 1988
- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
<C> <C> <C> <C> <C> <C> <C>
$ 15.36 $ 15.21 $ 15.10 $ 15.57 $ 15.00 $ 14.71 $ 13.66
--------- --------- --------- --------- ---------- ---------- ----------
.44 .49 .51 .64 .57 .46 .37
1.99 (.05) .51 (.63) - (.15) .80
--------- --------- --------- --------- ---------- ---------- ----------
2.43 .44 1.02 .01 .57 .31 1.17
(.24) (.29) (.91) (.48) - - -
- - - - - (.02) (.12)
--------- --------- --------- --------- ---------- ---------- ----------
(.24) (.29) (.91) (.48) - (.02) (.12)
--------- --------- --------- --------- ---------- ---------- ----------
$ 17.55 $ 15.36 $ 15.21 $ 15.10 $ 15.57 $ 15.00 $ 14.71
========= ========= ========= ========= ========== ========== ==========
15.86% 2.93% 7.01% .15% 3.80% 2.11% 8.58%
$ 79,043 $ 65,937 $ 72,312 $ 80,542 $ 93,663 $ 97,475 $ 90,177
========= ========= ========= ========= ========== ========== ==========
1.21% 1.25% 1.27% 1.36% 1.17% 1.17% 1.15%
2.66% 3.20% 3.29% 4.22% 3.80% 3.00% 2.53%
49.51% 70.77% 8.01% 31.58% 61.44% 23.87% 21.97%
$ - $ - $ - $ - $ - $ - $ -
</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 Year ended
July 31, 1997 January 31, 1997 January 31, 1996 January 31, 1995
(Unaudited)
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 67.55 $ 67.84 $ 66.40 $ 64.81
--------- ---------- ---------- ----------
Income from investment operations:
Net investment income (2) .................... 1.34 2.84 3.22 2.65
Net realized and unrealized gains
or losses on investments (3) ................. .02 .01 .06 (.39)
--------- ---------- ---------- ----------
Total income from investment operations 1.36 2.85 3.28 2.26
Less distributions from:
Net investment income ........................ - (3.14) (1.84) (.67)
--------- ---------- ---------- ----------
Total distributions - (3.14) (1.84) (.67)
--------- ---------- ---------- ----------
Net asset value, end of period $ 68.91 $ 67.55 $ 67.84 $ 66.40
========= ========== ========== ==========
Total return (4) ................................... 2.01% 4.23% 4.95% 3.49%
Ratios / supplemental data:
Net assets, end of period (in thousands) ........ $ 98,789 $ 105,342 $ 114,667 $ 121,666
========= ========== ========== ==========
Ratio of expenses to average net assets (2) ..... 1.18%* .90% .82% .82%
Ratio of net investment income
to average net assets ......................... 3.97%* 4.19% 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 .50% for the six months ended July 31,
1997 and .50%, .50%, .50%, .49%, .47%, .48%, .47%, .62%, .62% and .65% for
the years ended January 31, 1997, 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 $1.09 for the
six months ended July 31, 1997 and $2.37, $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 Year ended
July 31, 1997 January 31, 1997 January 31, 1996
(Unaudited)
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 57.24 $ 56.85 $ 54.90
--------- --------- ---------
Income from investment operations:
Net investment income (2) ............... 1.42 2.94 2.91
Net realized and unrealized gains
or losses on investments (3) .......... .18 (.34) 1.05
--------- --------- ---------
Total income from investment operations 1.60 2.60 3.96
Less distributions from:
Net investment income ................... - (2.21) (2.01)
Net realized gain on investments ........ - - -
--------- --------- ---------
Total distributions - (2.21) (2.01)
--------- --------- ---------
Net asset value, end of period $ 58.84 $ 57.24 $ 56.85
========= ========= =========
Total return (4) ............................ 2.80% 4.58% 7.24%
Ratios / supplemental data:
Net assets, end of period (in thousands).... $ 23,219 $ 21,345 $ 20,137
========= ========= =========
Ratio of expenses to average net assets (2). .98%* .97% .89%
Ratio of net investment income
to average net assets ................... 4.94%* 5.16% 5.21%
Portfolio turnover rate ................... 94.62%* 102.29% 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 .38% for the six months ended July 31, 1997 and .38%, .37%,
.36%, .39%, .41% and .43% for the years ended January 31, 1997, 1996, 1995,
1994, 1993 and the period ended January 31, 1992, respectively. Without
this waiver, the net investment income per share would have been $1.28 for
the six months ended July 31, 1997 and $2.66, $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, 1997 January 31, 1997 January 31, 1996
(Unaudited)
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 47.66 $ 40.65 $ 31.61
--------- ---------- ----------
Income or loss from investment operations:
Net investment income (loss) ............................ (.14) .26 (.02)
Net realized and unrealized gains
or losses on investments .............................. 10.99 7.05 10.68
--------- ---------- ----------
Total income or loss from investment operations 10.85 7.31 10.66
Less distributions from:
Net investment income ................................... - (.25) (.11)
Net realized gain on investments ........................ - (.05) (1.51)
--------- ---------- ----------
Total distributions - (.30) (1.62)
--------- ---------- ----------
Net asset value, end of period $ 58.51 $ 47.66 $ 40.65
========= ========== ==========
Total return (2) ............................................. 22.77% 18.00% 33.78%
Ratios / supplemental data:
Net assets, end of period (in thousands) .................... $ 18,935 $ 15,417 $ 11,067
========= ========== ==========
Ratio of expenses to average net assets ...................... 1.46%* 1.33% 1.19%
Ratio of net investment income (loss) to average net assets... (.54)%* .59% (.06)%
Portfolio turnover rate ...................................... -* 21.32% 18.94%
Average brokerage commission rate paid (3) ................... $ .0451 $ .0588 $ -
<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
years beginning before September 1, 1995.
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Year ended Year ended Year ended Year ended Period ended
January 31, 1995 January 31, 1994 January 31, 1993 January 31, 1992 January 31, 1991(1)
---------------- ---------------- ---------------- ---------------- -------------------
<C> <C> <C> <C> <C>
$ 32.56 $ 26.63 $ 22.77 $ 18.35 $ 20.00
--------- --------- --------- ---------- ---------
(.01) .01 .02 .06 .13
(.89) 6.41 4.44 4.38 (1.78)
--------- --------- --------- ---------- ---------
(.90) 6.42 4.46 4.44 (1.65)
(.03) (.02) (.13) (.02) -
(.02) (.47) (.47) - -
--------- --------- --------- ---------- ---------
(.05) (.49) (.60) (.02) -
--------- --------- --------- ---------- ---------
$ 31.61 $ 32.56 $ 26.63 $ 22.77 $ 18.35
========= ========= ========= ========== =========
(2.75)% 24.25% 19.77% 24.21% (8.25)%*
$ 6,758 $ 7,201 $ 3,596 $ 2,577 $ 1,151
========= ========= ========= ========== =========
1.23% 1.20% 1.12% 1.18% 1.07%*
(.04)% .02% .12% .23% .64%*
26.29% 29.83% 25.62% 53.18% 36.88%*
$ - $ - $ - $ - $ -
</TABLE>
<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, 1997
Local 1-512-453-7558
