PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
SEMI-ANNUAL REPORT FOR THE SIX MONTHS ENDED JULY 31, 1998
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
July 31, 1998
(Unaudited)
ASSETS AND LIABILITIES
ASSETS
Investments at market value (Notes 1, 2, 5 & 6):
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 $63,977,955; $92,051,806; $20,992,082
and $11,409,019, respectively)
Cash ..........................................................................
Accounts receivable for shares of the portfolio sold ..........................
Accrued interest, dividends and foreign taxes receivable ......................
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 - 3,577,029; 1,366,916; 356,065 and 350,173 shares,
respectively ................................................................
Paid-in capital ...............................................................
Undistributed net investment income (loss) (Note 1) ...........................
Accumulated net realized gain (loss) on investments ...........................
Accumulated net realized loss 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
------------------- ----------------------- ------------------------ ---------------------------
<S> <C> <C> <C> <C>
$ 13,461,865 $ - $ - $ -
3,340,804 - - -
25,032 - - -
------------ ------------ ------------- ------------
16,827,701 - - -
6,840,154 - - -
9,923,522 - - -
10,479,035 - - 21,108,781
- - 20,205,770 -
23,417,454 92,059,050 825,536 -
------------ ------------ ------------- ------------
67,487,866 92,059,050 21,031,306 21,108,781
39,485 - 332 37,196
2,879 920,238 - 400
439,963 1,527,109 350,077 2,875
------------ ------------ ------------- ------------
67,970,193 94,506,397 21,381,715 21,149,252
- 57,799 - -
87,325 28,510 23,805 -
30,545 18,278 5,842 9,835
56,047 74,537 17,297 16,465
62,269 60,463 13,234 2,134
------------ ------------ ------------- ------------
236,186 239,587 60,178 28,434
------------ ------------ ------------- ------------
$ 67,734,007 $ 94,266,810 $ 21,321,537 $ 21,120,818
============ ============ ============= ============
$ 3,577 $ 1,367 $ 356 $ 350
53,315,256 93,207,985 19,955,577 11,433,456
------------ ------------ ------------- ------------
53,318,833 93,209,352 19,955,933 11,433,806
7,250,536 1,214,183 1,468,592 (148,275)
3,776,693 (163,969) (142,212) 135,525
(86,592) - - -
3,509,911 7,244 39,224 9,699,762
(35,374) - - -
------------ ------------ ------------- ------------
$ 67,734,007 $ 94,266,810 $ 21,321,537 $ 21,120,818
============ ============ ============= ============
$18.94 $68.96 $59.88 $60.32
====== ====== ====== ======
</TABLE>
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
STATEMENTS OF OPERATIONS
Six months ended July 31, 1998
(Unaudited)
Investment income:
Interest ....................................................................
Dividends ...................................................................
Expenses (Notes 3, 4 & 8):
Investment advisory fee .....................................................
Directors' fees and expenses ................................................
Officers' salary expense ....................................................
Long term disability plan expense.............................................
Excise tax ..................................................................
Regulatory expense ..........................................................
Total expenses
Less waiver of investment advisory fee ......................................
Net expenses
Net investment income (loss)
Realized and unrealized gain (loss)on investments and foreign currency
(Notes 1, 2, 5 & 6):
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 (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
------------------- ----------------------- ------------------------ ---------------------------
<S> <C> <C> <C> <C>
$ 1,098,555 $ 2,394,323 $ 659,893 $ 1,120
290,133 - - 72,987
------------ ------------ ------------- ------------
1,388,688 2,394,323 659,893 74,107
397,500 520,760 123,297 121,786
24,672 32,131 7,634 7,563
31,020 40,486 9,578 9,454
36,702 48,648 11,421 11,037
62,269 60,463 13,234 2,134
2,329 2,096 - 233
------------ ------------ ------------- ------------
554,492 704,584 165,164 152,207
- 232,533 41,088 -
------------ ------------ ------------- ------------
554,492 472,051 124,076 152,207
------------ ------------ ------------- ------------
834,196 1,922,272 535,817 (78,100)
------------ ------------ ------------- ------------
1,563,805 (3,930) 1,027 230,147
(86,592) - - -
------------ ------------ ------------- ------------
1,477,213 (3,930) 1,027 230,147
(2,831,532) (4,587) (58,619) 1,273,986
1,017 - - -
------------ ------------ ------------- ------------
(1,353,302) (8,517) (57,592) 1,504,133
------------ ------------ ------------- ------------
$ (519,106) $ 1,913,755 $ 478,225 $ 1,426,033
============ ============ ============= ============
</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, 1998 January 31, 1998
(Unaudited)
---------------- ----------------
<S> <C> <C>
Operations:
Net investment income (loss) .............................................. $ 834,196 $ 1,402,992
Net realized gain (loss) on investments ................................... 1,563,805 2,224,037
Net realized loss on foreign currency transactions ........................ (86,592) -
Change in unrealized appreciation (depreciation) of investments ........... (2,831,532) 1,508,317
Change in unrealized appreciation (depreciation) on translation of
assets and liabilities in foreign currencies ........................... 1,017 11,615
------------ ------------
Net increase (decrease) in net assets resulting from operations (519,106) 5,146,961
Equalization on shares issued and redeemed: ................................. (292,335) (497,147)
Distributions to shareholders from:
Net investment income ..................................................... - (1,233,055)
Net realized gain on investments .......................................... - (1,305,588)
Capital stock transactions exclusive of amounts allocated to undistributed
net investment income (Note 7): ........................................... (2,553,113) (4,004,133)
------------ ------------
Net increase (decrease) in net assets (3,364,554) (1,892,962)
Net assets at beginning of period 71,098,561 72,991,523
------------ ------------
Net assets at end of period (including undistributed net investment income
(loss) of $7,250,536 and $6,831,523; $1,214,183 and $520,264; $1,468,592
and $1,725,080; $(148,275) and $(70,175), respectively) $ 67,734,007 $ 71,098,561
============ ============
</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, 1998 January 31, 1998 July 31, 1998 January 31, 1998 July 31, 1998 January 31, 1998
(Unaudited) (Unaudited) (Unaudited)
- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
<S><C> <C> <C> <C> <C> <C>
$ 1,922,272 $ 3,956,396 $ 535,817 $ 1,127,755 $ (78,100) $ (107,261)
(3,930) (7,073) 1,027 (16,422) 230,147 (92,993)
- - - - - -
(4,587) 8,758 (58,619) 72,273 1,273,986 3,976,486
- - - - - -
------------ ------------- ------------ ------------ ------------ ------------
1,913,755 3,958,081 478,225 1,183,606 1,426,033 3,776,232
(25,660) (853,426) (256,392) 86,852 - 4,600
- (3,465,235) - (588,840) - (65,240)
- - - - - (992,338)
(1,821,127) (10,781,113) (2,255,214) 1,328,359 (260,708) 1,814,900
------------ ------------- ------------ ------------ ------------ ------------
66,968 (11,141,693) (2,033,381) 2,009,977 1,165,325 4,538,154
94,199,842 105,341,535 23,354,918 21,344,941 19,955,493 15,417,339
------------ ------------- ------------ ------------ ------------ ------------
$ 94,266,810 $ 94,199,842 $ 21,321,537 $ 23,354,918 $ 21,120,818 $ 19,955,493
============ ============= ============ ============ ============ ============
</TABLE>
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1998
(Unaudited)
<CAPTION>
Quantity Market Value
- ----------------- ------------
<C> <S> <C>
GOLD ASSETS - 19.87% of Total Net Assets
11,997 Troy Oz. Gold bullion (a) ......................................................... $ 3,434,817
33,883 Coins One-ounce gold coins (a) .................................................. 9,978,544
4,297 Units United States Gold Trust (a)(b) ........................................... 48,504
------------
Total Gold Assets (Cost $18,020,143) $ 13,461,865
------------
SILVER ASSETS - 4.93% of Total Net Assets
351,133 Troy Oz. Silver bullion (a) ........................................................ $ 1,912,974
379 Bags Silver coins (a) .......................................................... 1,427,830
------------
Total Silver Assets (Cost $3,126,799) $ 3,340,804
------------
</TABLE>
<TABLE>
<CAPTION>
Principal Amount SWISS FRANC ASSETS - 10.14% of Total Net Assets
- ----------------
<C> <S> <C>
CHF 37,310 Swiss francs in interest-bearing bank accounts ............................ $ 25,032
------------
CHF 4,000,000 4.000% Swiss Confederation bonds, 03-10-99 ................................ 2,715,062
CHF 820,000 7.000% Swiss Confederation bonds, 07-09-01 ................................ 624,421
CHF 4,500,000 6.250% Swiss Confederation bonds, 01-07-03 ................................ 3,500,671
------------
Total Swiss Confederation bonds 6,840,154
------------
Total Swiss Franc Assets (Cost $7,134,796) $ 6,865,186
------------
</TABLE>
<TABLE>
<CAPTION>
Number STOCKS OF UNITED STATES AND FOREIGN REAL ESTATE AND NATURAL
Of Shares RESOURCE COMPANIES - 14.65% of Total Net Assets
---------
<C> <S> <C>
NATURAL RESOURCES - 4.56% of Total Net Assets
17,000 Broken Hill Proprietary, Ltd. (c) ......................................... $ 272,000
12,000 Burlington Resources, Inc. ................................................ 435,000
20,000 Cyprus Amax Minerals Company ............................................. 250,000
30,000 Forest Oil Corporation (a) ................................................ 367,500
25,000 Inco, Ltd. ................................................................ 273,438
20,000 Pogo Producing Company .................................................... 390,000
29,000 Santa Fe Energy Resources, Inc. (a) ...................................... 255,563
7,000 Texaco, Inc. .............................................................. 425,688
10,000 Weyerhaeuser Company ..................................................... 420,000
------------
$ 3,089,189
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1998
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
REAL ESTATE - 10.09% of Total Net Assets
27,500 Archstone Communities Trust ............................................... $ 577,500
22,000 BRE Properties, Inc. Class A .............................................. 555,500
31,000 Burnham Pacific Properties, Inc. .......................................... 428,188
23,500 Federal Realty Investment Trust ........................................... 549,313
47,000 IRT Property Company ...................................................... 505,250
25,000 MGI Properties ............................................................ 657,813
21,000 New Plan Realty Trust ..................................................... 479,063
20,100 Pennsylvania Real Estate Investment Trust ................................. 440,944
15,000 Texas Pacific Land Trust .................................................. 603,750
40,000 United Dominion Realty Trust, Inc. ........................................ 502,500
29,000 Urstadt Biddle Properties, Inc. Class A.................................... 525,625
31,900 Washington Real Estate Investment Trust ................................... 540,306
37,300 Western Investment Real Estate Trust ...................................... 468,581
-----------
$ 6,834,333
-----------
Total Stocks of United States and Foreign Real Estate and Natural
Resource Companies (Cost $7,063,647) $ 9,923,522
-----------
AGGRESSIVE GROWTH STOCK INVESTMENTS - 15.47% of Total Net Assets
CHEMICALS - .41% of Total Net Assets
8,000 Air Products & Chemicals, Inc. ........................................... $ 280,000
-----------
$ 280,000
COMPUTER SOFTWARE - 1.56% of Total Net Assets
6,000 Autodesk, Inc. ............................................................ $ 196,500
1 Symantec Corporation warrant (a)(d) ....................................... 858,524
-----------
$ 1,055,024
CONSTRUCTION - .15% of Total Net Assets
2,500 Fluor Corporation ........................................................ $ 105,156
-----------
$ 105,156
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1998
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
DATA PROCESSING - .46% of Total Net Assets
4,000 Hewlett-Packard Company ................................................... $ 222,000
4,000 Seagate Technology, Inc. (a) .............................................. 91,000
----------
$ 313,000
ELECTRICAL AND ELECTRONICS - 1.13% of Total Net Assets
10,000 DSC Communications Corporation (a) ....................................... $ 303,438
4,000 Intel Corporation ........................................................ 337,750
10,000 National Semiconductor Corporation (a) .................................... 123,125
----------
$ 764,313
ENTERTAINMENT AND LEISURE - 1.60% of Total Net Assets
6,000 The Walt Disney Company .................................................. $ 206,625
3,000 Harcourt General, Inc. ................................................... 169,313
12,000 Harrah's Entertainment, Inc. (a) ......................................... 253,500
4,625 Promus Hotel Corporation (a) .............................................. 174,016
4,200 Tribune Company .......................................................... 282,450
----------
$1,085,904
FINANCIAL SERVICES - 3.19% of Total Net Assets
3,000 Bank of New York, Inc. warrants (a) ....................................... $ 579,000
14,386 Bank of Petaluma (a) ...................................................... 303,904
5,000 Bear Stearns Companies, Inc. ............................................. 281,250
4,000 Morgan Stanley Dean Witter & Company ..................................... 348,250
8,000 The Charles Schwab Corporation ........................................... 300,000
5,000 State Street Corporation ................................................. 346,563
----------
$2,158,967
MANUFACTURING - 3.34% of Total Net Assets
6,000 Harley-Davidson, Inc. ..................................................... $ 237,750
3,000 Harnischfeger Industries, Inc. ............................................ 74,625
5,000 Illinois Tool Works, Inc. ................................................ 280,313
8,000 Mattel, Inc. ............................................................. 307,500
2,000 NACCO Industries, Inc. Class A ........................................... 230,625
8,000 NACCO Industries, Inc. Class B ........................................... 922,500
6,000 Parker-Hannifin Corporation .............................................. 205,875
----------
$2,259,188
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1998
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
OIL AND OILFIELD SERVICES - .59% of Total Net Assets
40,000 Frontier Oil Corporation (a) .............................................. $ 297,500
20,000 Parker Drilling Company (a) ............................................... 103,750
-----------
$ 401,250
PHARMACEUTICALS - 1.02% of Total Net Assets
8,000 Abbott Laboratories ....................................................... $ 332,500
2,400 Biogen, Inc. (a) .......................................................... 133,500
7,000 Genzyme Corporation (General Division) (a) ................................ 220,281
1,245 Genzyme Corporation Tissue Repair (a) ..................................... 6,614
-----------
$ 692,895
RETAIL - .42% of Total Net Assets
5,000 Costco Companies, Inc. (a) ................................................ $ 283,750
-----------
$ 283,750
TRANSPORTATION - .94% of Total Net Assets
8,000 ASA Holdings, Inc. ........................................................ $ 340,000
6,000 Kansas City Southern Industries, Inc. ..................................... 294,750
-----------
$ 634,750
MISCELLANEOUS - .66% of Total Net Assets
3,000 Lockheed Martin Corporation ............................................... $ 299,063
2,800 Temple-Inland, Inc. ....................................................... 145,775
-----------
$ 444,838
-----------
Total Aggressive Growth Stock Investments (Cost $2,937,895) $10,479,035
-----------
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE PERMANENT PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1998
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
UNITED STATES TREASURY SECURITIES - 34.57% of Total Net Assets
$41,000,000 United States Treasury bond strips (Principal only) 5.890%, 05-15-18(e) ... $ 13,008,070
800,000 United States Treasury bonds 6.250%, 08-15-23 ............................ 847,104
2,000,000 United States Treasury notes 5.875%, 01-31-99 ............................ 2,005,240
3,000,000 United States Treasury notes 7.750%, 01-31-00 ............................ 3,095,760
2,000,000 United States Treasury notes 5.250%, 01-31-01 ............................ 1,989,720
2,600,000 United States Treasury bills 5.000%, 07-22-99 (e).......................... 2,471,560
------------
Total United States Treasury Securities (Cost $25,694,675) $ 23,417,454
------------
Total Portfolio - 99.63% of total net assets (identified cost $63,977,955)(f) $ 67,487,866
Other assets, less liabilities (.37% of total net assets) 246,141
------------
Net assets applicable to outstanding shares $ 67,734,007
============
<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 $56,250,027..
</FN>
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE TREASURY BILL PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1998
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- -------------
<C> <S> <C>
UNITED STATES TREASURY SECURITIES - 97.66% of Total Net Assets
$ 23,000,000 United States Treasury notes 6.125%, 08-31-98 ............................. $ 23,019,780
27,000,000 United States Treasury notes 4.750%, 09-30-98 ............................. 26,985,690
20,000,000 United States Treasury notes 5.875%, 10-31-98 ............................. 20,025,200
22,000,000 United States Treasury notes 5.625%, 11-30-98 ............................. 22,028,380
-------------
Total Portfolio - 97.66% of total net assets (identified cost $92,051,806)(a) $ 92,059,050
Other assets, less liabilities (2.34% of total net assets) 2,207,760
-------------
Net assets applicable to outstanding shares $ 94,266,810
=============
<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, 1998
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
CORPORATE BONDS - 94.77% of Total Net Assets
BEVERAGES - 14.29% of Total Net Assets
$ 1,000,000 8.750% Anheuser-Busch Companies, Inc., 12-01-99 .......................... $ 1,038,230
1,000,000 7.875% Coca Cola Company, 09-15-98 ....................................... 1,003,030
1,000,000 7.625% PepsiCo, Inc., 11-01-98 ............................................ 1,005,670
------------
$ 3,046,930
ELECTRIC UTILITIES - 4.75% of Total Net Assets
1,000,000 7.500% Southern California Edison Company, 04-15-99 ....................... $ 1,013,020
------------
$ 1,013,020
ELECTRICAL AND ELECTRONICS - 9.44% of Total Net Assets
1,000,000 7.875% General Electric Company, 09-15-98 ................................. $ 1,003,060
1,000,000 6.750% Texas Instruments, Inc., 07-15-99 .................................. 1,009,510
------------
$ 2,012,570
FINANCIAL SERVICES - 14.19% of Total Net Assets
1,000,000 8.500% American General Finance Corporation, 06-15-99 ..................... $ 1,023,500
1,000,000 5.250% Associates Corporation of North America, 09-01-98 ................. 1,000,440
1,000,000 5.750% International Lease Finance Company, 01-15-99 ...................... 1,001,320
------------
$ 3,025,260
INSURANCE - 9.53% of Total Net Assets
1,000,000 9.000% SunAmerica, Inc., 01-15-99 ........................................ $ 1,014,930
1,000,000 7.750% Travelers Group, Inc., 06-15-99 .................................... 1,017,300
------------
$ 2,032,230
MANUFACTURING - 4.71% of Total Net Assets
1,000,000 6.375% Eaton Corporation, 04-01-99 ........................................ $ 1,004,160
------------
$ 1,004,160
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE VERSATILE BOND PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1998
(Unaudited)
<CAPTION>
Principal Amount Market Value
---------------- ------------
<C> <S> <C>
NATURAL GAS UTILITIES - 4.70% of Total Net Assets
$ 1,000,000 5.875% Consolidated Natural Gas Company, 10-01-98 ........................ $ 1,001,140
------------
$ 1,001,140
OIL AND OILFIELD SERVICES - 9.45% of Total Net Assets
1,000,000 7.625% Baker Hughes, Inc., 02-15-99 ....................................... $ 1,010,020
1,000,000 6.950% Shell Oil Company, 12-15-98 ....................................... 1,005,710
------------
$ 2,015,730
PHARMACEUTICALS - 9.59% of Total Net Assets
1,000,000 9.250% Baxter International, Inc., 12-15-99 ............................... $ 1,042,910
1,000,000 5.875% Upjohn Company, 04-15-00............................................ 1,002,700
------------
$ 2,045,610
PUBLISHING - 4.70% of Total Net Assets
1,000,000 5.850% Gannett Company, Inc., 05-01-00 ................................... $ 1,001,440
------------
$ 1,001,440
TELECOMMUNICATIONS - 9.42% of Total Net Assets
1,000,000 6.125% GTE Northwest, 02-15-99 ............................................ $ 1,002,750
1,000,000 6.150% New England Telephone & Telegraph Company, 09-01-99 ............... 1,004,930
------------
$ 2,007,680
------------
Total Corporate bonds (Cost $20,164,682) $ 20,205,770
------------
UNITED STATES TREASURY SECURITIES - 3.87% of Total Net Assets
800,000 United States Treasury notes 7.750%, 01-31-00.............................. $ 825,536
------------
Total United States Treasury Securities (Cost $827,400) $ 825,536
Total Portfolio - 98.64% of total net assets ------------
(identified cost $20,992,082)(a) $ 21,031,306
Other assets, less liabilities (1.36% of total net assets) 290,231
------------
Net assets applicable to outstanding shares $ 21,321,537
============
<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, 1998
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
AGGRESSIVE GROWTH STOCK INVESTMENTS - 99.94% of Total Net Assets
CHEMICALS - 3.86% of Total Net Assets
12,000 Air Products & Chemicals, Inc. ............................................ $ 420,000
20,000 Wellman, Inc. ............................................................. 396,250
----------
$ 816,250
COMPUTER SOFTWARE - 3.78% of Total Net Assets
14,800 Autodesk, Inc. ............................................................ $ 484,700
9,450 Computer Associates International, Inc. ................................... 313,621
----------
$ 798,321
CONSTRUCTION - 5.28% of Total Net Assets
7,000 Fluor Corporation ......................................................... $ 294,438
15,000 Johns Manville Corporation ............................................... 243,750
25,400 Ryland Group, Inc. ........................................................ 576,263
----------
$1,114,451
DATA PROCESSING - 3.11% of Total Net Assets
9,800 Hewlett-Packard Company ................................................... $ 543,900
5,000 Seagate Technology, Inc. (a) .............................................. 113,750
----------
$ 657,650
ELECTRICAL AND ELECTRONICS - 6.34% of Total Net Assets
22,200 DSC Communications Corporation (a) ........................................ $ 673,631
5,400 Intel Corporation ........................................................ 455,963
17,000 National Semiconductor Corporation (a) .................................... 209,313
----------
$1,338,907
ENTERTAINMENT AND LEISURE - 11.36% of Total Net Assets
15,900 The Walt Disney Company ................................................... $ 547,553
9,000 Harcourt General, Inc. .................................................... 507,938
5,000 Promus Hotel Corporation (a) .............................................. 188,125
9,600 Tribune Company .......................................................... 645,600
7,500 Viacom, Inc. Class A (a) .................................................. 509,063
----------
$2,398,279
FINANCIAL SERVICES - 16.96% of Total Net Assets
2,600 Bank of New York, Inc. warrants (a) ...................................... $ 501,800
15,000 Bear Stearns Companies, Inc. .............................................. 843,750
8,000 Morgan Stanley Dean Witter & Company ...................................... 696,500
20,000 The Charles Schwab Corporation ............................................ 750,000
11,400 State Street Corporation .................................................. 790,163
----------
$3,582,213
MANUFACTURING - 11.44% of Total Net Assets
8,400 Dana Corporation ......................................................... $ 417,900
10,000 Harley-Davidson, Inc. ..................................................... 396,250
9,000 Harnischfeger Industries, Inc. ............................................ 223,875
8,600 Illinois Tool Works, Inc. ................................................. 482,138
12,583 Mattel, Inc. .............................................................. 483,659
12,000 Parker-Hannifin Corporation ............................................... 411,750
----------
$2,415,572
</TABLE>
Continued on following page.
<PAGE>
<TABLE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
THE AGGRESSIVE GROWTH PORTFOLIO
SCHEDULE OF INVESTMENTS
July 31, 1998
(Unaudited)
<CAPTION>
Number
Of Shares Market Value
--------- ------------
<C> <S> <C>
OIL AND OILFIELD SERVICES - 4.75% of Total Net Assets
105,200 Frontier Oil Corporation (a) .............................................. $ 782,425
42,700 Parker Drilling Company (a) ............................................... 221,506
-----------
$ 1,003,931
PHARMACEUTICALS - 9.31% of Total Net Assets
8,000 Amgen, Inc. (a) .......................................................... $ 587,500
11,000 Biogen, Inc. (a) .......................................................... 611,875
17,000 Chiron Corporation (a) .................................................... 289,000
15,000 Genzyme Corporation (General Division) (a) ................................ 472,031
1,170 Genzyme Corporation Tissue Repair (a) .................................... 6,216
-----------
$ 1,966,622
RETAIL - 5.16% of Total Net Assets
14,000 Costco Companies, Inc. (a) ................................................ $ 794,500
13,000 Toys "R" Us, Inc. (a) ..................................................... 295,750
-----------
$ 1,090,250
TRANSPORTATION - 12.24% of Total Net Assets
16,000 ASA Holdings, Inc. ........................................................ $ 680,000
21,000 Kansas City Southern Industries, Inc. ..................................... 1,031,625
20,100 M.S. Carriers, Inc. (a) ................................................... 577,875
37,500 Mesa Air Group, Inc. (a) ................................................. 295,313
-----------
$ 2,584,813
MISCELLANEOUS - 6.35% of Total Net Assets
13,000 Browning-Ferris Industries, Inc. .......................................... $ 457,438
5,500 Lockheed Martin Corporation .............................................. 548,281
6,450 Temple-Inland, Inc. ....................................................... 335,803
-----------
$ 1,341,522
-----------
Total Portfolio - 99.94% of total net assets (identified cost $11,409,019)(b) $21,108,781
Other assets, less Liabilities (.06% of total net assets) 12,037
-----------
Net assets applicable to outstanding shares $21,120,818
===========
<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, 1998
(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, investment management 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, 1998, one such investment in the Permanent
Portfolio (1.27% 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, 1998, 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 .................... $ 6,795 $ - $ 652,040 $ -
Swiss franc assets ................. 124,142 - - -
United States Treasury securities .. 951,522 2,383,221 240 -
Other investments .................. 16,096 11,102 7,613 1,120
Dividends ............................ 290,133 - - 72,987
------------ ------------ ------------ -----------
$ 1,388,688 $ 2,394,323 $ 659,893 $ 74,107
============ ============ ============ ===========
</TABLE>
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1998
(Unaudited)
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, 1998; 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.
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, 1998.
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, 1998,
pursuant to the requirements of the Code.
At January 31, 1998, capital loss carry forwards available to offset future
realized gains, if any, were as follows: $151,117 in the Treasury Bill
Portfolio, of which $1,752, $98,561, $41,743, $5,429 and $3,632 expire on
January 31, 2001, January 31, 2002, January 31, 2003, January 31, 2004 and
January 31, 2005, respectively; $143,239 in the Versatile Bond Portfolio,
of which $89,841, $34,492 and $18,906 expire on January 31, 2003, January
31, 2004 and January 31, 2006, respectively; and $92,993 in the Aggressive
Growth Portfolio, all of which expires on January 31, 2006. There were no
capital loss carryforwards in the Permanent Portfolio.
Pursuant to the Code, 16.55% and 100.00% of the distributions made from
investment company taxable income in 1997 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, 1998, the Fund
reclassified from undistributed net investment income to paid-in capital,
certain book and tax basis differences relating to shareholder
distributions, totaling $122,848, $1,202,693 and $535,913 for the Permanent
Portfolio, the Treasury Bill Portfolio and the Versatile Bond Portfolio
respectively.
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1998
(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
$17,442 at July 31, 1998. 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 (including payments made by the Fund under its Long
Term Disability Plan described in Note 4), 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, 1998, 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, 1998
(Unaudited)
4. LONG TERM DISABILITY PLAN
On March 9, 1998, the Fund's Board of Directors adopted the Permanent
Portfolio Family of Funds, Inc. Long Term Disability Plan (the "Plan"). The
Plan provides for payment by the Fund to any qualified officer of the Fund
who is totally disabled (a "Participant"), as defined by the Plan, a
disability benefit equal to 50% of the Participant's salary as of the time
the disability is determined, subject to cost-of-living adjustments, for a
period not to exceed five years. The Plan is renewable annually and may be
terminated by the Fund's Board of Directors at any time prior to each
annual renewal. On March 10, 1998, the Fund accrued an estimated liability
of $107,808 under the Plan.
5. 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, 1998:
<TABLE>
<CAPTION>
Permanent Treasury Bill Versatile Bond Aggressive Growth
Portfolio Portfolio Portfolio Portfolio
------------- ------------- -------------- -----------------
<S> <C> <C> <C> <C>
Purchases................................ $ 4,460,628 None $ 3,891,840 $ 392,862
Sales.................................... 4,746,276 None 5,605,040 768,925
</TABLE>
6. NET UNREALIZED APPRECIATION OF INVESTMENTS
<TABLE>
The following is a summary of net unrealized appreciation of investments at
July 31, 1998 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 .................... $16,616,142 $ 10,366 $ 47,188 $10,063,731
Investments other than securities ....... 304,120 - - -
----------- -------- ----------- -----------
16,920,262 10,366 47,188 10,063,731
Aggregate gross unrealized depreciation
of investments with excess of tax cost
over value:
Investments in securities of unaffiliated
issuers ................................. (1,034,874) (3,122) (7,964) (363,969)
Investments other than securities........ (4,647,549) - - -
----------- -------- ----------- -----------
(5,682,423) (3,122) (7,964) (363,969)
----------- -------- ----------- -----------
Net unrealized appreciation
of investments $11,237,839 $ 7,244 $ 39,224 $ 9,699,762
=========== ======== =========== ===========
</TABLE>
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1998
(Unaudited)
7. 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 31,1998 Year ended January 31, 1998
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 181,314 $ 3,180,093 267,705 $ 4,309,828
Distributions reinvested......... - - 124,147 2,324,036
--------- ------------ ---------- ------------
181,314 3,180,093 391,852 6,633,864
Shares redeemed.................. (329,750) (5,733,206) (632,375) (10,637,997)
--------- ------------ ---------- ------------
Net decrease (148,436) $ (2,553,113) (240,523) $ (4,004,133)
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Treasury Bill Portfolio
---------------------------------------------------------------------------------
Six months ended July 31,1998 Year ended January 31, 1998
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 264,738 $ 17,544,590 667,488 $ 43,964,269
Distributions reinvested......... - - 48,405 3,251,352
--------- ------------ ---------- ------------
264,738 17,544,590 715,893 47,215,621
Shares redeemed.................. (292,219) (19,365,717) (880,865) (57,996,734)
--------- ------------ ---------- ------------
Net decrease (27,481) $ (1,821,127) (164,972) $(10,781,113)
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Versatile Bond Portfolio
---------------------------------------------------------------------------------
Six months ended July 31,1998 Year ended January 31, 1998
---------------------------------------- --------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- -----------------
<S> <C> <C> <C> <C>
Shares sold...................... 44,502 $ 2,365,962 410,273 $ 21,564,778
Distributions reinvested......... - - 9,512 553,476
--------- ------------ ---------- ------------
44,502 2,365,962 419,785 22,118,254
Shares redeemed.................. (87,123) (4,621,176) (393,973) (20,789,895)
--------- ------------ ---------- ------------
Net increase (decrease) (42,621) $ (2,255,214) 25,812 $ 1,328,359
========= ============ ========== ============
</TABLE>
<TABLE>
<CAPTION>
Aggressive Growth Portfolio
---------------------------------------------------------------------------------
Six months ended July 31,1998 Year ended January 31, 1998
---------------------------------------- -------------------------------------
Shares Dollars Shares Dollars
---------------- -------------------- ------------------- ----------------
<S> <C> <C> <C> <C>
Shares sold...................... 40,364 $ 2,501,749 195,149 $ 10,447,677
Distributions reinvested......... - - 18,011 1,021,204
--------- ------------ ---------- ------------
40,364 2,501,749 213,160 11,468,881
Shares redeemed.................. (45,030) (2,762,457) (181,840) (9,653,981)
--------- ------------ ---------- ------------
Net increase (decrease) (4,666) $ (260,708) 31,320 $ 1,814,900
========= ============ ========== ============
</TABLE>
Continued on following page.
<PAGE>
PERMANENT PORTFOLIO FAMILY OF FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
July 31, 1998
(Unaudited)
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, including expenses
paid by WMM to persons who are directors and officers of the Fund for
litigation support services. The Fund's management does not believe the
Fund will incur substantial additional expenses relating to this matter.
The Fund so paid or reimbursed the following expenses during the six months
ended July 31, 1998 and the years January 31, 1992 through 1998:
Permanent Treasury Bill Versatile Bond Aggressive Growth
Portfolio Portfolio Portfolio Portfolio
------------- ------------- -------------- -----------------
1992 .... $ - $ - $ - $ -
1993 .... 52,331 63,961 - -
1994 .... - - - -
1995 .... 78,010 71,156 6,213 1,777
1996 .... 26,100 22,233 1,646 848
1997 .... 53,511 43,469 3,046 2,640
1998 .... 325,585 293,026 - 32,558
1999 .... 2,329 2,096 - 233
---------- ---------- ---------- ----------
$ 537,866 $ 495,941 $ 10,905 $ 38,056
========== ========== ========== ==========
<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, 1998 January 31, 1998 January 31, 1997 January 31, 1996
(Unaudited)
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 19.08 $ 18.40 $ 18.80 $ 16.51
--------- --------- --------- ---------
Income or loss from investment operations:
Net investment income ................ .22 .37 .52 .50
Net realized and unrealized gains
or losses on investments and
foreign currencies ................ (.36) 1.01 (.41) 2.17
--------- --------- --------- ---------
Total income or loss from
investment operations (.14) 1.38 .11 2.67
Less distributions from:
Net investment income ................ - (.34) (.42) (.38)
Net realized gain on investments ..... - (.36) (.09) -
--------- --------- --------- ---------
Total distributions - (.70) (.51) (.38)
--------- --------- --------- ---------
Net asset value, end of period $ 18.94 $ 19.08 $ 18.40 $ 18.80
========= ========= ========= =========
Total return (1) ......................... (.73)% 7.57% .57% 16.20%
Ratios / supplemental data:
Net assets, end of period (in thousands). $ 67,734 $ 71,099 $ 72,992 $ 76,641
========= ========= ========= =========
Ratio of expenses to average net assets.. 1.57%* 1.91% 1.49% 1.35%
Ratio of net investment income
to average net assets ................ 2.37%* 1.96% 2.78% 2.85%
Portfolio turnover rate ................. 19.32%* 7.66% 12.29% 9.96%
Average brokerage commission
rate paid (2) ........................ $ .0722 $ .0207 $ .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, 1995 January 31, 1994 January 31, 1993 January 31, 1992 January 31, 1991 January 31, 1990 January 31, 1989
- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
<S><C> <C> <C> <C> <C> <C> <C>
$ 17.55 $ 15.36 $ 15.21 $ 15.10 $ 15.57 $ 15.00 $ 14.71
--------- --------- --------- --------- --------- --------- ---------
.64 .44 .49 .51 .64 .57 .46
(1.46) 1.99 (.05) .51 (.63) - (.15)
--------- --------- --------- --------- --------- --------- ---------
(.82) 2.43 .44 1.02 .01 .57 .31
(.22) (.24) (.29) (.91) (.48) - -
- - - - - - (.02)
--------- --------- --------- --------- --------- --------- ---------
(.22) (.24) (.29) (.91) (.48) - (.02)
--------- --------- --------- --------- --------- --------- ---------
$ 16.51 $ 17.55 $ 15.36 $ 15.21 $ 15.10 $ 15.57 $ 15.00
========= ========= ========= ========= ========= ========= =========
(4.65)% 15.86% 2.93% 7.01% .15% 3.80% 2.11%
$ 71,610 $ 79,043 $ 65,937 $ 72,312 $ 80,542 $ 93,663 $ 97,475
========= ========= ========= ========= ========= ========= =========
1.32% 1.21% 1.25% 1.27% 1.36% 1.17% 1.17%
2.63% 2.66% 3.20% 3.29% 4.22% 3.80% 3.00%
31.24% 49.51% 70.77% 8.01% 31.58% 61.44% 23.87%
$ - $ - $ - $ - $ - $ - $ -
</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, 1998 January 31, 1998 January 31, 1997 January 31, 1996
(Unaudited)
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 67.56 $ 67.55 $ 67.84 $ 66.40
---------- ---------- ---------- ----------
Income from investment operations:
Net investment income (1) .................... 1.41 2.69 2.84 3.22
Net realized and unrealized gains
or losses on investments (2) ................. (.01) .06 .01 .06
---------- ---------- ---------- ----------
Total income from investment operations 1.40 2.75 2.85 3.28
Less distributions from:
Net investment income ........................ - (2.74) (3.14) (1.84)
---------- ---------- ---------- ----------
Total distributions - (2.74) (3.14) (1.84)
---------- ---------- ---------- ----------
Net asset value, end of period $ 68.96 $ 67.56 $ 67.55 $ 67.84
========== ========== ========== ==========
Total return (3) ................................... 2.07% 4.09% 4.23% 4.95%
Ratios / supplemental data:
Net assets, end of period (in thousands) ........ $ 94,267 $ 94,200 $ 105,342 $ 114,667
========== ========== ========== ==========
Ratio of expenses to average net assets (1) ..... 1.02%* 1.20% .90% .82%
Ratio of net investment income
to average net assets ......................... 4.16%* 3.98% 4.19% 4.79%
<FN>
* Computed on an annualized basis.
(l) 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, 1998 and
.50%, .50%, .50%, .50%, .49%, .47%, .48%, .47%, .62% and .62% for the years
ended January 31, 1998, 1997, 1996, 1995, 1994, 1993, 1992, 1991, 1990 and
1989, respectively. Without this waiver, the net investment income per
share would have been $1.17 for the six months ended July 31, 1998 and
$2.19, $2.37, $2.78, $2.12, $1.04, $1.28, $2.85, $3.85, $3.96 and $3.00 for
the years then ended.
(2) 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.
(3) 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 Year ended
January 31, 1995 January 31, 1994 January 31, 1993 January 31, 1992 January 31, 1991 January 31, 1990 January 31, 1989
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
<S><C> <C> <C> <C> <C> <C> <C>
$ 64.81 $ 64.45 $ 64.99 $ 63.11 $ 59.35 $ 54.91 $ 51.54
---------- ---------- ---------- ---------- ---------- ---------- ----------
2.65 1.53 1.68 3.26 4.20 4.36 3.38
(.39) (.09) .19 (.08) (.01) .08 .02
---------- ---------- ---------- ---------- ---------- ---------- ----------
2.26 1.44 1.87 3.18 4.19 4.44 3.40
(.67) (1.08) (2.41) (1.30) (.43) - (.03)
---------- ---------- ---------- ---------- ---------- ---------- ----------
(.67) (1.08) (2.41) (1.30) (.43) - (.03)
---------- ---------- ---------- ---------- ---------- ---------- ----------
$ 66.40 $ 64.81 $ 64.45 $ 64.99 $ 63.11 $ 59.35 $ 54.91
========== ========== ========== ========== ========== ========== ==========
3.49% 2.24% 2.89% 5.05% 7.06% 8.09% 6.60%
$ 121,666 $ 133,970 $ 179,888 $ 320,382 $ 207,889 $ 61,056 $ 31,370
========== ========== ========== ========== ========== ========== ==========
.82% .72% .73% .73% .83% .54% .54%
3.57% 2.46% 2.97% 4.87% 6.74% 7.87% 6.70%
</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, 1998 January 31, 1998 January 31, 1997
(Unaudited)
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 58.58 $ 57.24 $ 56.85
--------- --------- ---------
Income from investment operations:
Net investment income (2) ............... 1.43 2.87 2.94
Net realized and unrealized gains
or losses on investments (3) .......... (.13) .17 (.34)
--------- --------- ---------
Total income from investment operations 1.30 3.04 2.60
Less distributions from:
Net investment income ................... - (1.70) (2.21)
Net realized gain on investments ........ - - -
--------- --------- ---------
Total distributions - (1.70) (2.21)
--------- --------- ---------
Net asset value, end of period $ 59.88 $ 58.58 $ 57.24
========= ========= =========
Total return (4) ............................ 2.22% 5.33% 4.58%
Ratios / supplemental data:
Net assets, end of period (in thousands).... $ 21,322 $ 23,355 $ 21,345
========= ========= =========
Ratio of expenses to average net assets (2). 1.13%* 1.01% .97%
Ratio of net investment income
to average net assets ................... 4.88%* 4.95% 5.16%
Portfolio turnover rate ................... 36.34%* 55.53% 102.29%
<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, 1998 and .38%, .38%,
.37%, .36%, .39%, .41% and .43% for the years ended January 31, 1998, 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, 1998 and $2.59, $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 Year ended Period ended
January 31, 1996 January 31, 1995 January 31, 1994 January 31, 1993 January 31, 1992(1)
- ---------------- ---------------- ---------------- ---------------- ------------------
<S><C> <C> <C> <C> <C>
$ 54.90 $ 54.76 $ 53.63 $ 50.58 $ 50.00
--------- --------- --------- --------- ---------
2.91 2.12 1.87 2.06 2.51
1.05 (.63) (.04) 1.00 (1.93)
--------- --------- --------- --------- ---------
3.96 1.49 1.83 3.06 .58
(2.01) (1.33) (.70) (.01) -
- (.02) - - -
--------- --------- --------- --------- ---------
(2.01) (1.35) (.70) (.01) -
--------- --------- --------- --------- ---------
$ 56.85 $ 54.90 $ 54.76 $ 53.63 $ 50.58
========= ========= ========= ========= =========
7.24% 2.74% 3.42% 6.05% 3.33%*
$ 20,137 $ 22,229 $ 35,682 $ 23,217 $ 596
========= ========= ========= ========= =========
.89% .86% .89% .89% 1.07%*
5.21% 3.84% 3.46% 3.86% 4.00%*
51.64% 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, 1998 January 31, 1998 January 31, 1997
(Unaudited)
---------------- ---------------- ----------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 56.24 $ 47.66 $ 40.65
---------- ---------- ----------
Income or loss from investment operations:
Net investment income (loss) ............................ (.21) (.31) .26
Net realized and unrealized gains
or losses on investments .............................. 4.29 11.97 7.05
---------- ---------- ----------
Total income or loss from investment operations 4.08 11.66 7.31
Less distributions from:
Net investment income ................................... - (.19) (.25)
Net realized gain on investments ........................ - (2.89) (.05)
---------- ---------- ----------
Total distributions - (3.08) (.30)
---------- ---------- ----------
Net asset value, end of period $ 60.32 $ 56.24 $ 47.66
========== ========== ==========
Total return (2) ............................................. 7.25% 24.41% 18.00%
Ratios / supplemental data:
Net assets, end of period (in thousands) .................... $ 21,121 $ 19,955 $ 15,417
========== ========== ==========
Ratio of expenses to average net assets ...................... 1.43%* 1.46% 1.33%
Ratio of net investment income (loss) to average net assets... (.73)%* (.60)% .59%
Portfolio turnover rate ...................................... 3.68%* 2.15% 21.32%
Average brokerage commission rate paid (3) ................... $ .0870 $ .0041 $ .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 Year ended Period ended
January 31, 1996 January 31, 1995 January 31, 1994 January 31, 1993 January 31, 1992 January 31, 1991(1)
---------------- ---------------- ---------------- ---------------- ---------------- ------------------
<S> <C> <C> <C> <C> <C> <C>
$ 31.61 $ 32.56 $ 26.63 $ 22.77 $ 18.35 $ 20.00
--------- --------- --------- --------- --------- ---------
(.02) (.01) .01 .02 .06 .13
10.68 (.89) 6.41 4.44 4.38 (1.78)
--------- --------- --------- --------- --------- ---------
10.66 (.90) 6.42 4.46 4.44 (1.65)
(.11) (.03) (.02) (.13) (.02) -
(1.51) (.02) (.47) (.47) - -
--------- --------- --------- --------- --------- ---------
(1.62) (.05) (.49) (.60) (.02) -
--------- --------- --------- --------- --------- ---------
$ 40.65 $ 31.61 $ 32.56 $ 26.63 $ 22.77 $ 18.35
========= ========= ========= ========= ========= =========
33.78% (2.75)% 24.25% 19.77% 24.21% (8.25)%*
$ 11,067 $ 6,758 $ 7,201 $ 3,596 $ 2,577 $ 1,151
========= ========= ========= ========= ========= =========
1.19% 1.23% 1.20% 1.12% 1.18% 1.07%*
(.06)% (.04)% .02% .12% .23% .64%*
18.94% 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, 1998
Local 1-512-453-7558
