AMERICAN MUTUAL FUND
Semi-annual Report
for the six months ended April 30, 1996
[The American Funds Group(R)]
AMERICAN MUTUAL FUND(R)
Strives for the balanced accomplishment of three objectives - current income,
capital growth and conservation of principal - through investments in companies
that participate in the growth of the American economy.
ABOUT OUR COVER
A farm in Vermont following the fall harvest.
Fund results in this report were computed without a sales charge unless
otherwise indicated. Here are the average annual compound returns with all
distributions reinvested for periods ended March 31, 1996 (the most recent
calendar quarter), assuming payment of the maximum 5.75% sales charge at the
beginning of the stated periods (sales charges are lower for accounts of
$50,000 or more):
10 years: +11.40%; 5 years: +12.33%; 12 months: +19.44%
The fund's 30-day yield as of May 31, 1996, calculated in accordance with the
Securities and Exchange Commission formula, was 3.00%.
THE FIGURES IN THIS REPORT REFLECT PAST RESULTS. SHARE PRICE AND RETURN WILL
VARY, SO YOU MAY LOSE MONEY BY INVESTING IN THE FUND. THE SHORTER THE TIME
PERIOD OF YOUR INVESTMENT, THE GREATER THE POSSIBILITY OF LOSS. FUND SHARES ARE
NOT DEPOSITS OR OBLIGATIONS OF, OR INSURED OR GUARANTEED BY, THE U.S.
GOVERNMENT, ANY FINANCIAL INSTITUTION, THE FEDERAL DEPOSIT INSURANCE
CORPORATION, OR ANY OTHER AGENCY, ENTITY OR PERSON.
AMERICAN MUTUAL FUND
FELLOW INVESTORS:
American Mutual Fund posted another solid advance during our first fiscal half.
For the six months ended April 30, the value of your investment in the
fund increased 10.8% if, like most shareholders, you reinvested the two income
dividends of 21 cents a share paid last December and April, as well as the
capital gain distribution of $1.15 a share paid in December.
Once again there was broad strength throughout the portfolio. Of the 115
stocks held over the course of the six-month period, 97 rose in price, 17
declined and one was unchanged. Many of the fund's economically sensitive
investments responded to indications of a pickup in the pace of business
activity. Capital equipment manufacturers and energy and chemical-related
issues tended to be particular areas of strength. Interest-rate-sensitive
issues such as banks, which until recently helped lead the advance, for the
most part rose in price but their gains were limited by a rise in longer term
interest rates over the period.
RESULTS AT A GLANCE
(with dividends reinvested and Average annual
capital gain distributions reinvested) Total return compound return
6 months
(11/1/95-4/30/96) +10.8% -
12 months
(5/1/95-4/30/96) +24.0% -
10 years
(5/1/86-4/30/96) +219.0% +12.3%
Lifetime
(2/21/50-4/30/96) +28,974.8% +13.1%
By and large, individual stock selection was good. At the close of the
fiscal period, 73.2% of the portfolio was invested in equity-type securities,
mostly in the common stocks of large, established corporations with long
records of increasing earnings and dividends. Another 5.5% was in bonds and
notes and 21.3% was in cash and equivalents. This was in keeping with the
fund's three-fold objective, which includes current income and preservation of
capital as well as capital growth. The unmanaged Standard & Poor's 500
Composite Index, which represents a fully invested position in stocks at all
times, gained 13.8% on a reinvested basis during the six-month period.
The fund's conservative mix of investments reflects a somewhat cautious
stance regarding the near-term prospects for the market given the magnitude of
the rise in stock prices over the past 18 months. Longer term there are reasons
to be optimistic. Although we have now entered the sixth year of this economic
recovery (the average post-World War II expansion, by contrast, has averaged
slightly more than four years), inflation remains remarkably quiescent. Many
corporations continue to increase competitiveness, often through restructurings
and capital investments in productivity-enhancing equipment. World trade
continues to expand. And inflows into the market by individuals investing for
their retirement or their children's education continue unabated.
These trends have been in place for some time and should remain positive
forces for the financial markets for some time to come. Even so, they will not
prevent periodic declines in stock prices. In the face of such an eventuality,
we will be alert to investment opportunities that might emerge and seek to
prudently commit the fund's buying reserves on your behalf.
Cordially,
James K. Dunton
President
June 12, 1996
<TABLE>
AMERICAN MUTUAL FUND
April 30, 1996
- ---------------------------- ----------------------------
Percent of
Largest Industry Holdings* Net Assets
<S> <C>
Banking 11.27%
Telecommunications 9.34%
Energy Sources 7.80%
Health & Personal Care 6.58%
Utilities: Electric & Gas 3.62%
Other Industries 34.59%
Bonds, Notes, Cash and Equivalents 26.80%
*Percentages above do not include certain
stocks in initial period of acquisition.
- ---------------------------- ----------------------------
Percent of
Largest Individual Holdings Net Assets
- ---------------------------- ----------------------------
AT&T 2.96%
DuPont 2.12
Ameritech 1.99
Amoco 1.71
Minnesota Mining and Manufacturing 1.66
Pacific Telesis 1.44
Phillips Petroleum 1.44
Merck 1.38
Ford Motor 1.37
Wachovia 1.34
</TABLE>
<TABLE>
AMERICAN MUTUAL FUND Investment Portfolio
April 30, 1996 Unaudited
Market Percent
EQUITY-TYPE SECURITIES Value of Net
(common and preferred stocks) Shares (Millions) Assets
----------- ----------------------
<S> <C> <C> <C>
Energy
Energy Sources- 6.10%
Amoco Corp. 1,700,000 $124.100 1.71%
Ashland Inc. 519,100 21.348 .29
Atlantic Richfield Co. 450,000 52.988 .73
Chevron Corp. 750,000 43.500 .60
Exxon Corp. 825,000 70.125 .97
Phillips Petroleum Co. 2,500,000 103.750 1.44
Royal Dutch Petroleum Co.
(New York Registered Shares) 675,000 96.694 1.34
Texaco Inc. 400,000 34.200 .47
Unocal Corp. $3.50 convertible preferred 330,000 18.232 .25
Utilities: Electric & Gas- 3.62%
Carolina Power & Light Co. 200,000 7.200 .10
Central and South West Corp. 2,300,000 62.675 .86
Consolidated Edison Co. of New York, Inc. 1,900,000 55.812 .77
Dominion Resources, Inc. 150,000 5.775 .08
Duke Power Co. 500,000 23.500 .32
Entergy Corp. 1,600,000 42.400 .59
Houston Industries Inc. 1,100,000 23.512 .32
Pacific Gas and Electric Co. 1,600,000 36.400 .50
Unicom Corp. 200,000 5.500 .08
----------- ------
827.711 9.73
----------- ------
Materials
Chemicals- 3.03%
Dow Chemical Co. 350,000 31.106 .43
E.I. du Pont de Nemours and Co. 1,912,500 153.717 2.12
Monsanto Co. 228,900 34.678 .48
Forest Products & Paper- 2.16%
Georgia-Pacific Corp. 225,000 17.494 .24
International Paper Co. 1,000,000 39.875 .55
Rayonier Inc. 50,000 1.794 .02
Union Camp Corp. 850,000 46.219 .64
Westvaco Corp. 850,000 26.350 .37
Weyerhaeuser Co. 500,000 24.750 .34
Metals: Steel- 0.30%
Worthington Industries, Inc. 1,050,000 21.394 .30
Miscellaneous Materials & Commodities- 0.19%
TRINOVA Corp. 400,000 14.100 .19
----------- ------
411.477 5.68
----------- ------
Capital Equipment
Aerospace & Military Technology- 1.42%
Boeing Co. 470,000 38.599 .53
General Motors Corp., Class H 250,000 15.281 .21
Sundstrand Corp. 750,000 27.563 .38
United Technologies Corp. 200,000 22.100 .30
Construction & Housing- 0.15%
Stone & Webster, Inc. 325,000 11.050 .15
Data Processing & Reproduction- 1.90%
International Business Machines Corp. 735,000 79.012 1.09
Xerox Corp. 400,000 58.600 .81
Electrical & Electronic- 0.80%
General Electric Co. 450,000 34.875 .48
Hubbell Inc., Class B 360,000 23.265 .32
Electronic Components- 0.51%
Motorola, Inc. 600,000 36.750 .51
Industrial Components- 1.72%
Dana Corp. 700,000 23.275 .32
Goodyear Tire & Rubber Co. 400,000 20.850 .29
Johnson Controls, Inc. 200,000 14.300 .20
TRW Inc. 700,000 65.713 .91
Machinery & Engineering- 2.10%
Caterpillar Inc. 1,150,000 73.600 1.02
Deere & Co. 2,014,200 78.302 1.08
----------- ------
623.135 8.60
----------- ------
Consumer Goods
Automobiles- 1.37%
Ford Motor Co., Class A 2,779,620 99.719 1.37
Beverages- 0.35%
PepsiCo, Inc. 400,000 25.400 .35
Food & Household Products- 1.30%
Colgate-Palmolive Co. 325,000 24.903 .34
ConAgra, Inc. 900,000 34.763 .47
CPC International Inc. 185,000 12.788 .18
General Mills, Inc. 400,000 22.200 .31
Health & Personal Care- 6.58%
Abbott Laboratories 550,000 22.344 .31
American Home Products Corp. 800,000 84.400 1.16
Bausch & Lomb Inc. 501,000 19.977 .28
Bristol-Myers Squibb Co. 375,000 30.844 .43
Johnson & Johnson 400,000 37.000 .51
Kimberly-Clark Corp. 200,000 14.525 .20
Eli Lilly and Co. 400,000 23.600 .33
Merck & Co., Inc. 1,650,000 99.825 1.38
Pharmacia & Upjohn, Inc. 847,500 32.417 .45
Schering-Plough Corp. 1,150,000 65.981 .91
Warner-Lambert Co. 400,000 44.700 .62
Textiles & Apparel- 0.39%
VF Corp. 500,000 28.500 .39
----------- ------
723.886 9.99
----------- ------
Services
Broadcasting & Publishing- 1.00%
Gannett Co., Inc. 550,000 37.606 .52
Tribune Co. 500,000 34.875 .48
Business & Public Services- 2.22%
Dun & Bradstreet Corp. 1,000,000 60.875 .84
Moore Corp. Ltd. 1,875,700 34.232 .47
Pitney Bowes Inc. 1,000,000 48.750 .67
WMX Technologies, Inc. 500,000 17.375 .24
Leisure & Tourism- 0.54%
Marriott International, Inc. 800,000 39.000 .54
Merchandising- 1.90%
J. C. Penney Co., Inc. 700,000 34.650 .48
Wal-Mart Stores, Inc. 3,250,000 77.594 1.07
Walgreen Co. 800,000 25.600 .35
Telecommunications- 9.34%
Ameritech Corp. 2,475,000 144.478 1.99
AT&T Corp. 3,495,000 214.069 2.96
Bell Atlantic Corp. 400,000 26.000 .36
GTE Corp. 1,500,000 65.062 .90
Pacific Telesis Group 3,050,000 104.462 1.44
SBC Communications Inc. 700,000 35.000 .48
Sprint Corp. 700,000 29.487 .41
U S WEST Communications Group 1,750,000 57.312 .80
Transportation: Rail & Road- 2.71%
Conrail, Inc. 750,000 52.313 .72
Norfolk Southern Corp. 955,000 80.220 1.11
Union Pacific Corp. 950,000 64.719 .88
----------- ------
1,283.679 17.71
----------- ------
Finance
Banking- 11.27%
AmSouth Bancorporation 1,000,000 38.375 .53
Banc One Corp. 2,310,000 80.273 1.11
BankAmerica Corp. 250,000 18.937 .26
Boatmen's Bancshares, Inc. 700,000 27.125 .37
The Chase Manhattan Corp. (New) 1,050,000 72.319 1.00
Comerica Inc. 1,700,000 73.950 1.02
First Chicago NBD Corp. 1,200,000 49.500 .68
First Security Corp. 1,425,000 35.981 .50
First Union Corp. 550,000 33.825 .47
Firstar Corp. 800,000 37.200 .51
Fleet Financial Group, Inc. 1,450,000 62.350 .86
Huntington Bancshares Inc. 1,050,000 25.462 .35
J.P. Morgan & Co. Inc. 450,000 37.856 .52
PNC Bank Corp. 2,300,000 69.575 .97
Wachovia Corp. 2,200,000 96.800 1.34
Wells Fargo & Co. 233,333 56.612 .78
Financial Services- 1.27%
Beneficial Corp. 350,000 19.338 .27
Federal National Mortgage Assn. 1,580,000 48.388 .67
Household International, Inc. 350,000 24.194 .33
Insurance- 2.75%
Aetna Life and Casualty Co. 400,000 28.500 .39
Allstate Corp. 800,000 31.100 .43
American General Corp. 1,610,000 56.551 .78
Lincoln National Corp. 600,000 28.950 .40
SAFECO Corp. 858,600 28.334 .39
St. Paul Companies, Inc. 500,000 26.562 .36
----------- ------
1,108.057 15.29
----------- ------
Multi-Industry & Miscellaneous
Multi-Industry- 2.71%
Harsco Corp. 50,000 3.444 .05
Minnesota Mining and Manufacturing Co. 1,825,000 119.994 1.66
Tenneco Inc. 700,000 38.412 .53
Textron Inc. 400,000 34.300 .47
----------- ------
196.150 2.71
----------- ------
Miscellaneous- 1.80%
Stocks in initial period of acquisition 130.432 1.80
----------- ------
TOTAL EQUITY-TYPE SECURITIES (cost:
$3,427.384 million) 5,304.527 71.51
----------- ------
BONDS AND NOTES Principal
Amount
Corporate- 0.18% -----------
J.C. Penney Co., Inc. 9.05% 2001 $12,000,000 13.010 .18
----------- ------
U.S. Treasury Obligations- 5.30%
12.375% May 2004 50,000,000 67.562 .93
11.75% February 2001 50,000,000 60.914 .84
8.25% July 1998 60,000,000 62.625 .86
5.125% April 1998 60,000,000 58.987 .81
8.125% February 1998 60,000,000 62.100 .86
6.00% November 1997 60,000,000 60.028 .83
6.375% June 1997 12,000,000 12.077 .17
----------- ------
384.293 5.30
----------- ------
TOTAL BONDS AND NOTES (cost: $415.586 million) 397.303 5.48
----------- ------
TOTAL INVESTMENT SECURITIES (cost: $3,842.970
million) 5,701.830 76.99
----------- ------
SHORT-TERM SECURITIES
Corporate Short-Term Notes- 14.09%
American Express Credit Corp. 5.28%-5.32%
due 5/14-6/20/96 76,650,000 76.238 1.05
Ameritech Corp. 5.28% due 5/24-5/28/96 46,745,000 46.557 .64
BellSouth Telecommunications, Inc. 5.25%-5.28%
due 5/29-6/5/96 50,300,000 50.056 .69
E.I. du Pont De Nemours and Co. 5.22%-5.29%
due 5/10-6/27/96 57,000,000 56.651 .78
Eli Lilly and Co. 5.03% due 5/14/96 /1/ 15,300,000 15.269 .21
Emerson Electric Co. 5.20%-5.29%
due 5/2-5/3/96 54,450,000 54.428 .75
Ford Motor Credit Co. 5.29%-5.32%
due 5/2-6/11/96 112,900,000 112.572 1.55
Gannett Co. 5.28%-5.33%
due 5/15-5/30/96 /1/ 85,200,000 84.936 1.17
General Electric Capital Corp. 5.27%-5.31%
due 5/7-7/16/96 89,800,000 89.468 1.24
H.J.Heinz Co. 5.28%-5.32%
due 5/1-5/20/96 53,000,000 52.918 .73
Hewlett-Packard Co. 5.21%
due 6/18/96 24,300,000 24.124 .33
J.C. Penney Funding Corp. 5.28%-5.31%
due 5/31-6/14/96 60,100,000 59.737 .83
PepsiCo, Inc. 5.22%-5.31%
due 5/23-5/29/96 61,300,000 61.087 .84
Procter & Gamble Co. 5.05%-5.20%
due 5/2-6/4/96 107,400,000 107.099 1.48
Wal-Mart Stores, Inc. 5.30% due 5/3/96 50,000,000 49.979 .69
Xerox Corp. 5.13%-5.30% due 5/13-6/13/96 80,750,000 80.473 1.11
Federal Agency Short-Term Obligations- 6.10%
Federal Home Loan Bank 5.00% due 5/22/96 67,074,000 67.065 .93
Federal Home Loan Mortgage Corp. 5.00%-5.14%
due 5/13-6/10/96 249,800,000 248.655 3.43
Federal National Mortgage Assn. 4.98%-5.14%
due 5/1-6/12/96 126,465,000 126.240 1.74
U.S. Treasury Short-Term Securities - 0.86%
7.25%-7.375% due 5/15-11/15/96 61,700,000 61.868 .86
----------- ------
TOTAL SHORT-TERM SECURITIES (cost: $1,525.448
million) 1,525.420 21.05
Excess of cash and receivables over payables 19.255 .27
----------- ------
TOTAL SHORT-TERM SECURITIES,
CASH AND RECEIVABLES, NET OF PAYABLES 1,544.675 21.32
----------- ------
NET ASSETS $7,246.505 98.30%
=========== ======
/1/Purchased in a private placement transaction;
resale to the public may require registration or
may extend only to qualified institutional buyers.
See Notes to Financial Statements
</TABLE>
<TABLE>
American Mutual Fund Unaudited
- ------------------------------------- ----------------- ------------------
Statement of Assets and Liabilities (dollars in
April 30, 1996 millions)
- ------------------------------------- ----------------- ------------------
<S> <C> <C>
Assets:
Investment securities at market
(cost: $3,842.970) $5,701.830
Short-term securities
(cost: $1,525.448) 1,525.420
Cash 2.128
Receivables for-
Sales of fund's shares $ 5.985
Dividends and accrued interest 21.274 27.259
----------------- ------------------
7,256.637
Liabilities:
Payables for-
Purchases of investments 2.880
Repurchases of fund's shares 3.215
Management services 1.762
Accrued expenses 2.275 10.132
----------------- ------------------
Net Assets at April 30, 1996-
Equivalent to $25.14 per share on
288,288,580 shares of $1 par value
capital stock outstanding (authorized
capital stock--500,000,000 shares) $7,246.505
=================
- ------------------------------------- ----------------- ------------------
Statement of Operations (dollars in
for the six months ended April 30, 1996 millions)
- ------------------------------------- ----------------- ------------------
Investment Income:
Income:
Dividends $ 80.146
Interest 57.304 $137.450
-----------------
Expenses:
Management services fee 10.357
Distribution expenses 6.850
Transfer agent fee 2.256
Reports to shareholders .290
Registration statement and
prospectus .347
Postage, stationery and supplies .528
Directors' fees .081
Auditing and legal fees .057
Custodian fee .081
Taxes other than federal income tax .074
Other expenses .043 20.964
----------------- ----------------
Net investment income 116.486
-----------------
Realized Gain and Unrealized
Appreciation on Investments:
Net realized gain 312.897
Net increase in unrealized appreciation on
investments:
Beginning of period 1,583.521
End of period 1,858.832 275.311
----------------- ----------------
Net realized gain and increase in unrealized
appreciation on investments 588.208
---------------
Net Increase in Net Assets Resulting
from Operations $704.694
================
See Notes to Financial Statements
- ---------------------------------------- ----------------
Statement of Changes in Net Assets (dollars in
millions)
- ----------------------------------------- ------------------
Six months ended Year ended
April 30, 1996* October 31,
1995
----------------- ----------------
Operations:
Net investment income $ 116.486 $ 230.323
Net realized gain on investments 312.897 305.112
Net increase in unrealized appreciation
on investments 275.311 612.873
----------------- -----------------
Net increase in net assets
resulting from operations 704.694 1,148.308
----------------- ----------------
Dividends and Distributions
Paid to Shareholders:
Dividends from net investment income (117.131) (220.251)
Distributions from net realized
gain on investments (311.944) (217.473)
----------------- -----------------
Total dividends and distributions (429.075) (437.724)
----------------- -----------------
Capital Share Transactions:
Proceeds from shares sold:
20,111,024 and 31,087,225
shares, respectively 498.587 689.376
Proceeds from shares issued in
reinvestment of net investment
income dividends and distributions of
net realized gain on investments:
15,957,657 and 18,568,126
shares, respectively 386.564 388.017
Cost of shares repurchased:
18,810,974 and 28,510,164
shares, respectively (466.349) (633.334)
----------------- ----------------
Net increase in net assets
resulting from capital share
transactions 418.802 444.059
----------------- ------------------
Total Increase in Net Assets 694.421 1,154.643
Net Assets:
Beginning of period 6,552.084 5,397.441
----------------- -----------------
End of period (including undistributed
net investment income: $41.254
and $41.899, respectively) $7,246.505 $6,552.084
================= =================
*Unaudited
See Notes to Financial Statements
</TABLE>
Notes to Financial Statements Unaudited
1. American Mutual Fund, Inc. (the "fund") is registered under the Investment
Company Act of 1940 as an open-end, diversified management investment company.
The fund strives for the balanced accomplishment of three objectives--current
income, capital growth and conservation of principal--through investments in
companies that participate in the growth of the American economy. The following
paragraphs summarize the significant accounting policies consistently followed
by the fund in the preparation of its financial statements:
Equity-type securities traded on a national securities exchange (or
reported on the NASDAQ national market) and securities traded in the
over-the-counter market are stated at the last reported sales price on the day
of valuation; other securities, and securities for which no sale was reported
on that date, are stated at the last quoted bid price.
Bonds and notes are valued at prices obtained from a bond-pricing service
provided by a major dealer in bonds, when such prices are available; however,
in circumstances where the investment adviser deems it appropriate to do so,
such securities will be valued at the mean of their representative quoted bid
and asked prices or, if such prices are not available, at prices for securities
of comparable maturity, quality, and type.
Short-term securities with original or remaining maturities in excess of 60
days are valued at the mean of their quoted bid and asked prices. Short-term
securities with 60 days or less to maturity are valued at amortized cost, which
approximates market value. Securities for which market quotations are not
readily available are valued at fair value as determined in good faith by the
Valuation Committee of the Board of Directors.
As is customary in the mutual fund industry, securities transactions are
accounted for on the date the securities are purchased or sold. Realized gains
and losses from securities transactions are reported on an identified cost
basis. Dividend and interest income is reported on the accrual basis. Discounts
on securities purchased are amortized over the life of the respective
securities. The fund does not amortize premiums on securities purchased.
Dividends and distributions paid to shareholders are recorded on the
ex-dividend date.
Pursuant to the custodian agreement, the fund receives credits against its
custodian fee for imputed interest on certain balances with the custodian
bank. The custodian fee of $81,000 includes $21,000 that was paid by these
credits rather than in cash.
2. It is the fund's policy to continue to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its net taxable income, including any net realized gain on
investments, to its shareholders. Therefore, no federal income tax provision is
required.
As of April 30, 1996, net unrealized appreciation on investments for
federal income tax purposes aggregated $1,860,188,000, of which $1,897,249,000
related to appreciated securities and $37,061,000 related to depreciated
securities. There was no difference between book and tax realized gains on
securities transactions for the six months ended April 30, 1996. The cost of
portfolio securities for federal income tax purposes was $5,367,062,000 at
April 30, 1996.
3. The fee of $10,357,000 for management services was paid pursuant to an
agreement with Capital Research and Management Company (CRMC) with which
certain officers and Directors of the fund are affiliated. The Investment
Advisory and Service Agreement provides for monthly fees, accrued daily, based
on an annual rate of 0.384% of the first $1 billion of average net assets;
0.33% of such assets in excess of $1 billion but not exceeding $2 billion;
0.294% of such assets in excess of $2 billion but not exceeding $3 billion;
0.27% of such assets in excess of $3 billion but not exceeding $5 billion;
0.252% of such assets in excess of $5 billion but not exceeding $8 billion; and
0.24% of such assets in excess of $8 billion.
Pursuant to a Plan of Distribution, the fund may expend up to 0.25% of its
average net assets annually for any activities primarily intended to result in
sales of fund shares, provided the categories of expenses for which
reimbursement is made are approved by the fund's Board of Directors. Fund
expenses under the Plan include payments to dealers to compensate them for
their selling and servicing efforts. During the six months ended April 30,
1996, distribution expenses under the Plan were $6,850,000. As of April 30,
1996, accrued and unpaid distribution expenses were $2,108,000.
American Funds Service Company (AFS), the transfer agent for the fund, was
paid a fee of $2,256,000. American Funds Distributors, Inc. (AFD), the
principal underwriter of the fund's shares, received $1,910,000 (after
allowances to dealers) as its portion of the sales charges paid by purchasers
of the fund's shares. Such sales charges are not an expense of the fund and,
hence, are not reflected in the accompanying statement of operations.
Directors who are unaffiliated with CRMC may elect to defer part or all of
the fees earned for services as memebers of the Board. Amounts deferred are not
funded and are general unsecured liabilities of the fund. As of April 30, 1996,
aggregate amounts deferred and earnings thereon were $157,000.
CRMC is owned by The Capital Group Companies, Inc. AFS and AFD are both
wholly owned subsidiaries of CRMC. Certain Directors and officers of the fund
are or may be considered to be affiliated with CRMC, AFS, and AFD. No such
persons received any remuneration directly from the fund.
4. As of April 30, 1996, accumulated undistributed net realized gain on
investments was $291,677,000 and paid-in capital was $4,766,453,000.
The fund made purchases and sales of investment securities, excluding
short-term securities, of $683,064,000 and $874,902,000, respectively, during
the six months ended April 30, 1996.
<TABLE>
Per-Share Data and Ratios Six monthsYear ended
ended October 31
April 30 ------- ------- ------- ------- -------
1996 /1/ 1995 1994 1993 1992 1991
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period $24.17 $21.60 $23.21 $21.29 $20.98 $17.91
------- ------- ------- ------- ------- -------
Income from Investment
Operations:
Net investment income .41 .87 .88 .85 .87 .89
Net realized and unrealized
gain (loss) on investments 2.13 3.41 (.54) 2.89 .98 3.39
------- ------- ------- ------- ------- -------
Total income from
investment operations 2.54 4.28 .34 3.74 1.85 4.28
------- ------- ------- ------- ------- -------
Less Distributions:
Dividends from net investment
income (.42) (.84) (.84) (.85) (.88) (1.01)
Distributions from net
realized gains (1.15) (.87) (1.11) (.97) (.66) (.20)
------- ------- ------- ------- ------- -------
Total distributions (1.57) (1.71) (1.95) (1.82) (1.54) (1.21)
------- ------- ------- ------- ------- -------
Net Asset Value, End of Perio $25.14 $24.17 $21.60 $23.21 $21.29 $20.98
======= ======= ======= ======= ======= =======
Total Return /2/ 10.80% /3/ 21.25% 1.75% 18.63% 9.43% 24.62%
Ratios/Supplemental Data:
Net assets, end of period (in
millions) $7,247 $6,552 $5,397 $5,283 $4,565 $4,134
Ratio of expenses to average
net assets .30% /3/ .59% .60% .59% .60% .63%
Ratio of net income to average
net assets 1.66% /3/ 3.92% 4.07% 3.83% 4.15% 4.47%
Average commissions paid
per share /1/ /4/ 5.60 cent 6.27 cent 6.54 cent 7.31 cent 7.56 cent 7.68 cents
Portfolio turnover rate 12.14% /3/ 23.31% 18.46% 22.48% 37.35% 23.77%
/1/ Unaudited
/2/ Calculated without deducting
a sales charge.
The maximum sales charge is
5.75% of the fund's
offering price.
/3/ Based on operations for six
months and, accordingly, not
representative of a full year's
operations.
/4/Brokerage commissions paid on
portfolio transactions increase
the cost of securities purchased
or reduce the proceeds of
securities sold, and are not
reflected in the fund's
statement of operations.
Shares traded on a principal
basis, such as most over-the-
counter and fixed-income
transactions, are excluded.
</TABLE>
OFFICES OF THE FUND AND OF THE INVESTMENT ADVISER,
CAPITAL RESEARCH AND MANAGEMENT COMPANY
333 South Hope Street
Los Angeles, California 90071-1443
135 South State College Boulevard
Brea, California 92621-5804
TRANSFER AGENT FOR SHAREHOLDER ACCOUNTS
American Funds Service Company
P.O. Box 2205
Brea, California 92822-2205
P.O. Box 659522
San Antonio, Texas 78265-9522
P.O. Box 6007
Indianapolis, Indiana 46206-6007
P.O. Box 2280
Norfolk, Virginia 23501-2280
CUSTODIAN OF ASSETS
The Chase Manhattan Bank, N.A.
One Chase Manhattan Plaza
New York, New York 10081-0001
COUNSEL
O'Melveny & Myers LLP
400 South Hope Street
Los Angeles, California 90071-2899
PRINCIPAL UNDERWRITER
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, California 90071-1462
FOR INFORMATION ABOUT YOUR ACCOUNT OR ANY OF THE FUND'S SERVICES, PLEASE
CONTACT YOUR SECURITIES DEALER OR FINANCIAL PLANNER, OR CALL THE FUND'S
TRANSFER AGENT, TOLL-FREE, AT 800/421-0180.
This report is for the information of shareholders of American Mutual Fund, but
it may also be used as sales literature when preceded or accompanied by the
current prospectus, which gives details about charges, expenses, investment
objectives and operating policies of the fund. If used as sales material after
June 30, 1996, this report must be accompanied by an American Funds Group
Statistical Update for the most recently completed calendar quarter.
Printed on recycled paper
Litho in USA BDA/AL/2979
Lit. No. AMF-013-0696
[The American Funds Group(r)]
