Dear Shareholders:
The Lexington Worldwide Emerging Markets Fund appreciated 8.5%* for the
second quarter. For the first half of 1995 the Fund was down 2.8%*. The
unmanaged Morgan Stanley Emerging Market Index (the "Index") rose 9.7% for the
quarter, but was still down 4.31% for the first six months. The average emerging
market fund, according to Lipper Analytical Services, Inc., rose 8.6% during the
quarter, and was down 3.2% through June 30, 1995.
The Fund performed in line with its peers but underperformed the Index
during the quarter. The main reason for the underperformance was holdings in
cash while the Index was fully invested. However, the Fund benefitted from high
cash levels early in the year which helped reduce losses. Due to our positive
outlook for the emerging markets, cash levels are now only 5% versus a peak of
35% in the first quarter.
The emerging markets had a strong second quarter due to several factors. A
strong rally in the U.S. bond and stock markets had a positive influence on
emerging market equities. Due to severe declines in 1994 and the first quarter
of 1995, many stocks reached attractive valuation levels and were technically
oversold. Mexican equities led a strong rebound in Latin America. The economic
stabilization plan, with U.S. support has at least initially stabilized the
Mexican economy. In fact, the Mexican Peso appreciated against the dollar as
investors gained more confidence in the economy. Although Mexico will face a
recession in 1995, there are additional positive signs. Inflation seems to have
peaked and is now falling. Most importantly, Mexico is now enjoying a trade
surplus and has already returned to foreign debt markets. Mexico's turnaround
has had a positive effect on other emerging markets with particular emphasis on
Latin America. The Asian markets also performed well during the quarter. The
interest rate environment improved as U.S. bond yields fell thus propelling
stocks. Asian markets are highly sensitive to U.S. interest rate movement as
most Asian currencies are linked to the U.S. dollar. Elsewhere, the Israeli
market roared to a 13.7% return for domestically traded shares. Shares responded
to interest rate cuts by the Bank of Israel and attractive valuation levels due
to last year's sharp selloff of the equity market.
We remain positive on emerging markets for the rest of 1995. However,
emerging markets could be vulnerable to a strengthening of the U.S. economy. A
stronger U.S. economy could lead to higher interest rates and lower stock prices
in many markets. We believe this would only be a temporary correction and thus
would hold on to quality counters. Latin American markets enjoyed strong
performances during the quarter. However, at current levels, equity prices are
susceptible to further economic shocks. The Fund remains slightly underweight in
Latin markets and unless valuation levels improve we will remain underweight.
Due to improving economic prospects and attractive prices, the Fund retains
approximately 15% in Eastern Europe and Israel. Finally, we remain positive on
Asia and would consider adding to positions in Korea and Taiwan.
Also included in this semi-annual report to shareholders is a summary of the
results of the shareholder meeting held on April 19, 1995. All of the proposals
were approved by a majority of shareholders.
We appreciate your continued support and welcome the opportunity to discuss
any questions you may have about your investment.
Sincerely,
Richard T. Saler Robert M. DeMichele
Portfolio Manager President
July, 1995 July , 1995
*-3.18%, 8.32% and 10.94% are the one, five and ten year average annual
standard total returns, respectively, for the period ended June 30, 1995. Prior
to June 1991, the Fund operated under a different name and investment objective.
Investment return and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than at their
original cost. Total return represents past performance.
1
<PAGE>
Results of Annual Meeting of Shareholders held April 19, 1995 (unaudited)
Total Outstanding Shares as of February 1, 1995: 24,419,816
1. Directors Elected: Robert M. DeMichele, Beverley C. Duer, Barbara R. Evans,
Lawrence Kantor, Donald B. Miller, Francis Olmsted, John G. Preston,
Margaret W. Russell, Philip C. Smith and Francis A. Sunderland
<TABLE>
<CAPTION>
Votes Votes
Votes For Against Abstained
--------- ------ ---------
<S> <C> <C> <C>
2. Selection of KPMG Peat Marwick LLP as Independent Auditors .............. 10,800,163 297,452 1,196,543
3. Amended investment management agreement with Lexington
Management Corporation .................................................. 10,194,964 782,896 1,316,296
4. Amendment to fundamental restriction concerning senior
securities .............................................................. 10,080,763 842,755 1,370,639
5. Amendment to fundamental restriction concerning underwritting ........... 10,210,579 735,816 1,347,763
6. Amendment and Separation of the fundamental restrictions
concerning real estate and commodity contracts .......................... 9,806,974 1,141,148 1,346,037
7. Amendment to fundamental restriction concerning lending ................. 9,963,937 999,705 1,330,515
8. Elimination of fundamental restriction concerning securities of
other investment companies .............................................. 10,199,672 775,268 1,319,219
9. Elimination of fundamental restriction concerning margin and
short sales ............................................................. 9,746,011 1,186,233 1,361,915
10. Elimination of fundamental restriction concerning sales of
securities to the Fund's officers, directors, investment adviser and
distributor ............................................................. 9,552,769 1,386,941 1,354,449
11. Elimination of fundamental restriction concerning Fund's ability to
contract to sell securities ............................................. 9,755,564 1,149,877 1,388,718
12. Elimination of fundamental restriction concerning securities of
affiliates .............................................................. 9,929,145 994,205 1,370,808
13. Amendment to fundamental restriction concerning diversification ......... 10,019,627 943,917 1,330,614
14. Elimination of fundamental restriction concerning securities of
issuers in operation less than three (3) years .......................... 9,891,754 1,030,339 1,372,066
15. Elimination of fundamental restriction concerning investment for
control ................................................................ 9,687,783 1,227,919 1,378,455
16. Amendment to fundamental restriction concerning concentration ........... 10,113,631 807,747 1,372,780
17. Amendment to fundamental restriction concerning borrowing ............... 9,709,223 1,183,974 1,400,961
18. Amendment to fundamental restriction concerning puts and calls .......... 9,914,944 1,022,420 1,356,794
</TABLE>
2
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited)
<TABLE>
<CAPTION>
Principal
Amount or
Number of Value
Shares Security (Note 1)
------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS: 93.8%
<S> <C> <C>
Argentina: 2.9%
913,500 Central Costanera S.A. "B" ....................................................................... $ 2,951,490
749,500 Compania Naviera Perez Companc S.A. .............................................................. 3,148,844
49,000 Transportadora de Gas Del Sur S.A. ............................................................... 101,950
273,500 Transportadora de Gas Del Sur S.A. (ADR) ......................................................... 2,871,750
------------
9,074,034
------------
AUSTRIA: 0.7%
25,000 Bank Austria A.G. ................................................................................ 2,079,589
------------
BRAZIL: 8.6%
113,000 Aracruz Celulose S.A. (ADR) ...................................................................... 1,327,750
1,969,000 Centrais Electricas Brasileiras S.A. ............................................................. 535,054
382,006,000 Cia Acos Especiais Itabir (Preferred shares) ..................................................... 2,869,197
9,250,000 Cia Tecidos Norte De Mina (Preferred shares) ..................................................... 2,915,760
69,431,198 Compania Siderurgica Nacional .................................................................... 1,569,748
108,400 Compania Vale Do Rio Doce (ADR) (Preferred shares) ............................................... 4,186,950
74,741,000 Energetica de Minas Gerais ....................................................................... 1,478,571
17,630,000 Petroleo Brasileiro S.A. (Preferred shares) ...................................................... 1,533,043
451,000 Souza Cruz S.A. .................................................................................. 3,431,521
34,030,000 Telecomunicacoes de Sao Paulo S.A. (Preferred shares) ............................................ 4,235,255
2,686,436,000 Usinas Siderurgicas de Minas Gerais S.A. (Preferred shares) ...................................... 3,007,639
------------
27,090,488
------------
CHILE: 3.3%
95,000 Banco O'Higgins (ADR) ............................................................................ 2,185,000
107,100 Banco Osorno Y La Union (ADR) .................................................................... 1,486,012
56,200 Chile Fund, Inc. ................................................................................. 3,020,750
136,800 Madeco, S.A. (ADR) ............................................................................... 3,933,000
------------
10,624,762
------------
CZECH REPUBLIC: 0.5%
2,603 Fatra Napajedla A.S. ............................................................................. 65,880
9,568 Inzenyrske a Prumyslove Stavby A.S. .............................................................. 777,585
15,000 Komercni Banka A.S. .............................................................................. 754,643
------------
1,598,108
------------
GREECE: 3.1%
32,500 AEGEK ............................................................................................ 723,508
161,910 Delta Dairy S.A. (Preferred shares) .............................................................. 3,117,812
31,390 Etba Leasing ..................................................................................... 577,207
150,000 Michaniki S.A. ................................................................................... 2,350,845
75,000 Titan Cement Company ............................................................................. 2,851,736
------------
9,621,108
------------
</TABLE>
3
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited) (continued)
<TABLE>
<CAPTION>
Principal
Amount or
Number of Value
Shares Security (Note 1)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
HONG KONG: 12.2%
5,006,000 Cafe De Coral Holdings, Ltd. ..................................................................... $ 1,248,750
921,000 Cheung Kong (Holdings) Ltd. ...................................................................... 4,559,170
547,000 Dao Heng Bank Group Ltd. ......................................................................... 1,668,502
1,034,000 Hang Lung Development Company .................................................................... 1,643,815
907,000 Hang Seng Bank ................................................................................... 6,916,505
921,000 Henderson Land Development Company Ltd. .......................................................... 5,047,227
4,172,000 Hopewell Holdings ................................................................................ 3,531,937
274,000 HSBC Holdings Plc ................................................................................ 3,514,863
1,551,000 Hysan Development Company Ltd. ................................................................... 3,548,235
1,502,000 New World Development Company Ltd. ............................................................... 4,998,901
1,231,000 Peregrine Investment Holdings Ltd. ............................................................... 1,750,161
------------
38,428,066
------------
HUNGARY: 0.5%
26,800 Pick Szeged ...................................................................................... 1,439,570
------------
INDIA: 1.1%
344,300 The India Fund Inc. ............................................................................. 3,529,075
------------
INDONESIA: 7.2%
995,000 PT Argha Karya Prima Industries .................................................................. 737,533
1,210,000 PT Astra International ........................................................................... 2,147,124
169,000 PT Bank Niaga .................................................................................... 511,517
1,405,000 PT Hero Supermarket .............................................................................. 2,540,487
931,500 PT HM Sampoerna .................................................................................. 7,323,113
656,100 PT Lippo Bank .................................................................................... 1,156,869
300,000 PT Modern Photo Film Company ..................................................................... 1,630,727
1,166,000 PT Semen Cibinong ................................................................................ 3,666,666
2,888,000 PT Sinar Mas Agro Resources Agricultural Production and Technology Corporation ................... 3,048,876
------------
22,762,912
------------
ISRAEL: 7.3%
790 Africa-Israel Investments Ltd. ................................................................... 946,664
4,072,500 Bank Hapolim Ltd. ................................................................................ 6,413,603
512,000 Bezek Israeli Telecommunication Corporation Ltd. ................................................. 1,294,640
11,870 First International Bank of Israel ............................................................... 1,471,673
341,000 First Israel Fund, Inc. .......................................................................... 4,049,375
394,000 Israel Land Development .......................................................................... 1,183,484
29,020 Koor Industries Ltd. ............................................................................. 2,477,086
286,200 Osem Investment Ltd. ............................................................................. 2,213,792
79,600 Teva Pharmaceutical Industries Ltd.(ADR) ......................................................... 2,985,000
------------
23,035,317
------------
</TABLE>
4
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited) (continued)
<TABLE>
<CAPTION>
Principal
Amount or
Number of Value
Shares Security (Note 1)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
KOREA: 1.4%
100,000 Cho Hung Bank .................................................................................... $ 1,187,021
13,441 Kia Motors Corporation (ADR)1 .................................................................... 228,497
18,900 Korea Long Term Credit Bank ...................................................................... 540,925
3,509 Korea Long Term Credit Bank Rights* .............................................................. 100,429
20,200 Pohang Iron & Steel Company Ltd. (ADR) ........................................................... 595,900
26,062 Sung Shin Cement Industrial Company Ltd. ......................................................... 1,031,205
7,000 Taeyoung Corporation ............................................................................. 406,225
11,201 Taihan Electric Wire Company ..................................................................... 391,488
------------
4,481,690
------------
MALAYSIA: 7.3%
291,000 AMMB holdings Bhd ................................................................................ 3,462,864
792,000 Aokam Perdana Bhd ................................................................................ 1,966,187
980,000 Berjaya Singer Bhd ............................................................................... 1,166,187
962,000 Cement Industries of Malaysia Bhd ................................................................ 3,217,193
420,000 Genting Bhd ...................................................................................... 4,153,467
441,000 Malayan Banking Bhd .............................................................................. 3,492,531
935,000 New Straits Times Press Bhd ...................................................................... 2,896,696
727,000 Tanjong PLC ...................................................................................... 2,505,867
------------
22,860,992
------------
MEXICO: 4.5%
188,000 Grupo Casa Autrey, S.A. de C.V. (ADR) ............................................................ 2,796,500
157,900 Grupo Televisa S.A. .............................................................................. 3,217,212
123,233 San Luis CPO ..................................................................................... 2,723,163
525,700 Transportacion Maritima Mexicana S.A. de C.V. "L" (ADR) .......................................... 3,285,625
435,000 Tubos de Acero de Mexico S.A. (ADR) .............................................................. 2,147,812
------------
14,170,312
------------
PAKISTAN: 0.7%
313,700 Pakistan Investment Fund, Inc. .................................................................. 2,117,475
------------
PHILIPPINES: 4.4%
2,255,000 Ayala Land, Inc."B" .............................................................................. 2,609,748
788,000 Bacnotan Cement Corporation ...................................................................... 958,336
13,307,500 Filinvest Land Inc. .............................................................................. 3,863,299
4,574,650 International Container Terminal Service Inc. .................................................... 3,185,564
4,500,000 JG Summit Holdings "B" ........................................................................... 1,306,394
3,600,000 Universal Robina Corporation ..................................................................... 1,836,014
------------
13,759,355
------------
POLAND: 2.6%
26,242 Bank Slaski S.A. ................................................................................. 1,569,698
25,000 E. Wedel S.A. .................................................................................... 1,463,362
306,780 Elektrim Towarzystwo Handlowe S.A. ............................................................... 1,081,365
323,100 Polifarb S.A. .................................................................................... 1,780,811
148,400 Universal S.A. ................................................................................... 554,795
22,000 Zaklady Piwowarski w Zywcu S.A. .................................................................. 1,663,747
------------
8,113,778
------------
</TABLE>
5
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited) (continued)
<TABLE>
<CAPTION>
Principal
Amount or
Number of Value
Shares Security (Note 1)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
PORTUGAL: 1.7%
172,900 Banco Fomento Exterior ........................................................................... $ 1,562,135
23,650 Banco Totta & Acores Nationalisiert .............................................................. 501,813
172,100 Portugal Telecom S.A. (ADR) ...................................................................... 3,298,288
------------
5,362,236
------------
SINGAPORE: 9.1%
250,000 Development Bank of Singapore Ltd. ............................................................... 2,846,401
159,000 Fraser & Neave Ltd. .............................................................................. 1,833,082
321,000 Hitachi Zosen Singapore Ltd. ..................................................................... 225,263
5,000 Hong Leong Finance Ltd. Warrants* ................................................................ 4,654
1,501,000 Jurong Cement Ltd. ............................................................................... 4,750,748
233,000 Jurong Engineering Ltd. .......................................................................... 1,368,134
704,000 Keppel Corporation Ltd. .......................................................................... 5,746,938
2,016,000 Neptune Orient Lines Ltd. ........................................................................ 2,338,646
80,000 Oversea-Chinese Banking Corporation Ltd. ......................................................... 887,934
771,000 Overseas Union Bank Ltd. ......................................................................... 4,858,431
1,110,000 Pacific Carrier Ltd. ............................................................................. 1,033,297
443,000 Sembawang Corporation Ltd. ....................................................................... 2,696,383
------------
28,589,911
------------
SOUTH AFRICA: 6.1%
16,000 Anglo American Corporation of South Africa Ltd. (ADR) ............................................ 856,000
231,900 Anglo American Platinum (ADR) .................................................................... 1,658,108
261,800 Barlow Ltd. (ADR) ................................................................................ 2,667,087
231,900 JCI Ltd. (ADR) ................................................................................... 1,610,267
231,900 Johnnies Industrial Corporation (ADR) ............................................................ 2,455,264
154,200 Liberty Life Association of Africa Ltd. (ADR) .................................................... 4,260,546
219,000 Rustenburg Platinum Holdings Ltd. (ADR) .......................................................... 4,516,940
79,700 Samancor Ltd. (ADR) .............................................................................. 1,041,097
------------
19,065,309
------------
TAIWAN: 1.0%
143,700 Taiwan Fund, Inc. ................................................................................ 3,143,437
------------
THAILAND: 5.6%
2,700 Charoen Pokphand Feedmill Company Ltd. .......................................................... 16,413
173,000 Land and House Company Ltd. ...................................................................... 3,645,795
310,000 Matichon Public Company Ltd. ..................................................................... 1,595,542
95,000 Nation Publishing Group Company Ltd. ............................................................ 154,002
1,396,000 NTS Steel Groups Company Ltd. ................................................................... 2,729,766
269,000 Phatra Thanakit Company Ltd. .................................................................... 2,245,754
540,000 Quality House Company Ltd. ....................................................................... 2,472,948
88,000 Saha Pathanapibul Company Ltd. .................................................................. 164,052
54,000 Siam Cement Company Ltd. ........................................................................ 3,448,996
75,000 Siam City Cement Company Ltd. ................................................................... 1,191,489
------------
17,664,757
------------
6
</TABLE>
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited) (continued)
<TABLE>
<CAPTION>
Principal
Amount or
Number of Value
Shares Security (Note 1)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
UNITED KINGDOM: 1.4%
864,000 Antofagasta Holdings Plc ......................................................................... $ 4,447,072
------------
URUGUAY: 0.1%
11,000 Banco Commercial GDR 1 ........................................................................... 178,750
------------
VENEZUELA: 0.5%
410,400 Cermanic Carobobo (ADR)* ......................................................................... 430,920
121,900 Mantex S.A.C.A. (ADR)* ........................................................................... 594,262
114,800 Mavesa S.A. (ADR)* ............................................................................... 330,050
92,933 Mavesa S.A.(ADR)* ................................................................................ 267,183
------------
1,622,415
------------
TOTAL COMMON STOCKS (cost $295,681,526) .......................................................... 294,860,518
------------
SHORT-TERM INVESTMENTS: 3.9%
3,000,000 U.S. Treasury Bills, 5.67% due: 07/27/95 ......................................................... $ 2,987,715
3,000,000 U.S. Treasury Bills, 5.70% due: 07/20/95 ......................................................... 2,990,975
6,400,000 U.S. Treasury Bills, 5.70% due: 08/24/95 ......................................................... 6,345,280
------------
TOTAL SHORT-TERM INVESTMENTS (cost $12,323,970) .................................................. 12,323,970
------------
TOTAL INVESTMENTS: 97.7% (cost $308,005,496\'86) (Note 1) ........................................ 307,184,488
Other assets in excess of liabilities: 2.3% ...................................................... 7,143,656
------------
TOTAL NET ASSETS: 100.0% (equivalent to $11.15 per share
on 28,182,552 shares outstanding) .............................................................. $314,328,144
============
</TABLE>
At June 30, 1995, the composition of the Fund's net assets by industry
concentration was as follows:
(Left Column)
Banking/Financial Services ......................... 19.0%
Capital Equipment .................................. 4.0
Consumer (Durables) ................................ 1.2
Consumer (Non-Durables) ............................ 9.9
Energy Sources/Utility ............................. 3.8
Health Care ........................................ 0.9
Materials .......................................... 20.0
(Right Columnm)
Multi-Industry ..................................... 12.7%
Precious Metals .................................... 0.9
Real Estate ........................................ 9.4
Services ........................................... 9.3
Telecommunications ................................. 2.7
U.S. Government Obligations ........................ 3.9
Other assets in excess of liabilities .............. 2.3
-----
Net Assets .................................... 100.0%
=====
ADR-American Depository Receipt.
*Non-income producing securities.
1Restricted securities.
(D)Aggregate cost for Federal income tax purposes is identical.
The Notes to Financial Statements are an integral part of this statement.
7
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Statement of Assets and Liabilities
June 30, 1995 (unaudited)
<TABLE>
<S> <C>
Assets
Investments in securities, at value (cost $308,005,496) (Note 1) ....................... $307,184,488
Cash ................................................................................... 489,782
Foreign currencies, at value (cost $32,410) ............................................ 32,820
Receivable for investment securities sold .............................................. 6,036,750
Receivable for shares sold ............................................................. 934,895
Dividends receivable ................................................................... 736,370
Foreign taxes recoverable .............................................................. 10,568
------------
Total Assets ................................................................. 315,425,673
------------
Liabilities
Due to Lexington Management Corporation (Note 2) ....................................... 280,957
Payable for shares redeemed ............................................................ 667,633
Accrued expenses ....................................................................... 148,939
------------
Total Liabilities ............................................................ 1,097,529
------------
Net Assets (equivalent to $11.15 per share
on 28,182,552 shares outstanding) (Note 3) ........................................... $314,328,144
============
Net Assets consist of:
Capital stock-authorized 100,000,000 shares, $1.00 par value per share ................. $ 28,182,552
Additional paid-in capital ............................................................ 314,332,251
Undistributed net investment income ................................................... 2,320,346
Accumulated net realized loss on investments and foreign currency holdings ............ (29,686,339)
------------
Net unrealized depreciation of investments and foreign currency holdings ............... (820,666)
$314,328,144
============
</TABLE>
The Notes to Financial Statements are an integral part of this statement.
8
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Statement of Operations
Six months ended June 30, 1995 (unaudited)
<TABLE>
<S> <C> <C>
Investment Income
Income
Dividends .......................................................... $ 3,619,149
Interest ........................................................... 1,720,840
-----------
5,339,989
-----------
Less: Foreign tax expense .......................................... 571,261
-----------
Total investment income $4,768,728
Expenses
Investment advisory fee (Note 2) ................................... 1,420,784
Accounting and shareholder services expense (Note 2) ............... 215,602
Custodian and transfer agent expenses .............................. 510,909
Printing and mailing ............................................... 159,140
Directors' fees and expenses ....................................... 5,293
Audit and Legal .................................................... 23,881
Registration fees .................................................. 52,025
Computer processing fees ........................................... 7,688
Other expenses ..................................................... 53,060
-----------
Total expenses ................................................. 2,448,382
------------
Net investment income ...................................... 2,320,346
Realized and Unrealized Gain (Loss) on Investments (Note 4)
Realized loss from investments and foreign currency transactions
(excluding short-term securities):
Proceeds from sales ............................................ 89,137,807
Cost of securities sold ........................................ 116,532,120
-----------
Net realized loss .......................................... (27,394,313)
Unrealized depreciation of investments and foreign
currency holdings:
End of period .................................................. (820,666)
Beginning of period ............................................ (19,891,743)
-----------
Change during period ....................................... 19,071,077
------------
Net realized and unrealized loss on investments ............ (8,323,236)
------------
Decrease in Net Assets Resulting from Operations ....................... $ (6,002,890)
============
</TABLE>
The Notes to Financial Statements are an integral part of this statement.
9
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Statements of Changes in Net Assets
[CAPTION]
<TABLE>
Six months
ended Year ended
June 30, 1995 December 31,
(unaudited) 1994
------------ ------------
<S> <C> <C>
Net investment income (loss) .................................. $ 2,320,346 $ (174,837)
Net realized gain (loss) from security transactions ........... (27,394,313) 11,472,267
Decrease in unrealized appreciation (depreciation) of
investments and foreign currency holdings ................... 19,071,077 (62,458,378)
------------ ------------
Net decrease in net assets resulting from operations ...... (6,002,890) (51,160,948)
Distributions to shareholders from realized gains from
security transactions (Note 1) .............................. - (11,472,267)
Distributions to shareholders in excess of realized gains
from security transactions (Note 1) ......................... - (2,117,189)
Increase in net assets from
capital share transactions (Note 3) ......................... 31,749,845 122,858,778
------------ ------------
Net increase in net assets ........................ 25,746,955 58,108,374
Net Assets
Beginning of period ........................................... 288,581,189 230,472,815
------------ ------------
End of period (including undistributed net investment income of
$2,320,346 and $0, respectively)............................. $314,328,144 $288,581,189
============ ============
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
10
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Notes to Financial Statements
June 30, 1995 (unaudited) and December 31, 1994
1. Significant Accounting Policies
Lexington Worldwide Emerging Markets Fund, Inc. (the "Fund") is an open end
diversified management investment company registered under the Investment
Company Act of 1940, as amended. The following is a summary of the significant
accounting policies followed in the preparation of its financial statements:
Securities Security transactions are accounted for on a trade date basis.
Realized gains and losses from security transactions are reported on the
identified cost basis. Investments are stated at market value based on closing
prices reported by the exchange on which the securities are traded, on the last
business day of the period or, for over-the-counter securities, at the average
between bid and asked prices. Short-term securities are stated at amortized
cost, which approximates market value. Securities for which market quotations
are not readily available and other assets are valued at fair value as
determined by management and approved in good faith by the Board of Directors.
All investments quoted in foreign currency are valued in U.S. dollars on the
basis of the foreign currency exchange rate prevailing at the close of business.
Dividends are recorded on the ex-dividend date. Interest income is accrued as
earned.
Foreign Currency Transactions Foreign currencies (and receivables and
payables denominated in foreign currencies) are translated into U.S. dollar
amounts at current exchange rates. Translation gains or losses resulting from
changes in exchange rates and realized gains and losses on the settlement of
foreign currency transactions are reported in the statement of operations. In
addition, the Fund may enter into forward foreign exchange contracts in order to
hedge against foreign currency risk in the purchase or sale of securities
denominated in foreign currency. The Fund may also enter into such contracts to
hedge against changes in foreign currency exchange rates on portfolio positions.
These contracts are marked to market daily, by recognizing the difference
between the contract exchange rate and the current market rate as unrealized
gains or losses. Realized gains or losses are recognized when contracts are
settled and are reported in the statement of operations.
Distributions Effective January 1, 1993, the Fund adopted Statement of
Position 93-2: Determination, Disclosure and Financial Statement Presentation of
Income, Capital Gain and Return of Capital Distributions by Investment
Companies. As of December 31, 1994, book and tax basis differences amounting to
$132,316 have been reclassified from distributions in excess of net realized
gains to additional paid-in capital. In addition $174,837 was reclassified from
net investment loss to distributions in excess of net realized gains on
investments. Distribution in excess of net realized gains reflect temporary
book-tax differences arising from Internal Revenue Code ("IRC") Excise Tax
distribution requirements and associated post-October loss deferral provisions,
which effectively allow the deferral of net realized capital losses to the next
tax year.
Federal Income Taxes It is the Fund's intention to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Therefore, no provision for Federal income taxes has been made.
11
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Notes to Financial Statements
June 30, 1995 (unaudited) and December 31, 1994 (continued)
2. Investment Advisory Fee and Other Transactions with Affiliate
The Fund pays an investment advisory fee to Lexington Management Corporation
("LMC") at the rate of 1% of average daily net assets. The investment advisory
contract provides that the total annual expenses of the Fund (including
management fees, but excluding interest, taxes, brokerage commissions and
extraordinary expenses) will not exceed the level of expenses which the Fund is
permitted to bear under the most restrictive expense limitation imposed by any
state in which shares of the Fund are offered for sale. No reimbursement was
required for the six months ended June 30, 1995.
The Fund also reimburses LMC for certain expenses, including accounting and
shareholder servicing costs, which are incurred by the Fund, but paid by LMC.
3. Capital Stock
Transactions in capital stock were as follows:
<TABLE>
<CAPTION>
Six months ended
June 30, 1995 Year ended
(unaudited) December 31, 1994
----------------------------- ------------------------------
Shares Amount Shares Amount
---------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
Shares sold .................................... 12,908,200 $137,373,909 39,085,412 $521,337,885
Shares issued on reinvestment of dividends ..... - - 1,084,862 12,465,043
---------- ------------ ---------- ------------
12,908,200 137,373,909 40,170,274 533,802,928
---------- ------------ ---------- ------------
Shares redeemed ................................ (9,891,072) (105,624,064) (31,509,363) (410,944,150)
---------- ------------ ---------- ------------
Net increase ................................. 3,017,128 $ 31,749,845 8,660,911 $122,858,778
========== ============ ========== ============
</TABLE>
4. Purchases and Sales of Investment Securities
The cost of purchases and proceeds from sales of securities for the six months
ended June 30, 1995, excluding short-term securities, were $183,716,639 and
$89,137,807, respectively.
At June 30, 1995 aggregate gross unrealized appreciation for all securities and
foreign currency holdings (including foreign currency receivables and payables)
in which there is an excess of value over tax cost amounted to $29,162,635 and
aggregate gross unrealized depreciation for which there is an excess of tax cost
over value amounted to $29,983,301.
5. Investment Risks
The Fund's investments in foreign securities may involve risks not present in
domestic investments. Since foreign securities may be denominated in a foreign
currency and involve settlement and pay interest or dividends in foreign
currencies, changes in the relationship of these foreign currencies to the U.S.
dollar can significantly affect the value of the investments and earnings of the
Fund. Foreign investments may also subject the Fund to foreign government
exchange restrictions, expropriation, taxation or other political, social or
economic developments, all of which could affect the market and/or credit risk
of the investments.
In addition to the risks described above, risks may arise from forward foreign
currency contracts from the potential inability of counterparties to meet the
terms of their contracts.
12
<PAGE>
Lexington Worldwide Emerging Markets Fund, Inc.
Financial Highlights
Selected per share data for a share outstanding throughout the period:1
<TABLE>
<CAPTION>
Six months
ended Year ended December 31,
June 30, 1995 --------------------------------------------
(unaudited) 1994 1993 1992 1991
----------- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ................... $11.47 $13.96 $ 8.66 $ 9.03 $ 8.56
------ ------ ------ ------ ------
Income (loss) from investment operations:
Net Investment income (loss) ......................... .09 (.01) .05 .07 .09
Net realized and unrealized gain
(loss) on investments .............................. (.41) (1.92) 5.43 .27 1.97
------ ------ ------ ------ ------
Total income (loss) from investment operations ......... (.32) (1.93) 5.48 .34 2.06
------ ------ ------ ------ ------
Less distributions:
Dividends from net investment income ................. - - (.01) (.11) (.11)
Distributions from capital gains ..................... - (.47) (.17) (.60) (1.48)
Distributions in excess of capital gains
(temporary book-tax difference) .................... - (.09) - - -
------ ------ ------ ------ ------
Total distributions .................................... - (.56) (.18) (.71) (1.59)
------ ------ ------ ------ ------
Net asset value, end of period ......................... $11.15 $11.47 $13.96 $ 8.66 $ 9.03
====== ====== ====== ====== ======
Total return ........................................... (5.52%)* (13.81%) 63.37% 3.77% 24.19%
Ratio to average net assets:
Expenses ............................................. 1.72%* 1.65% 1.64% 1.89% 1.97%
Net investment income ................................ 1.63%* (.06%) .21% .75% .79%
Portfolio turnover ..................................... 77.63%* 79.56% 38.35% 91.27% 112.03%
Net assets at end of period (000's omitted) ............ $314,328 $288,581 $230,473 $30,021 $25,060
<FN>
------------
1Effective June 17, 1991 the Fund changed its name and investment objective from Lexington Growth Fund, Inc. to Lexington Worldwide
Emerging Markets Fund, Inc.
*Annualized.
</FN>
</TABLE>
13
<PAGE>
(Right Column)
The Lexington Group of
No Load Investment Companies
Investment objectives range from growth and income to
high yield and liquidity in money market instruments.
Selection depends on the investor's current financial
objectives and the degree of risk one is willing to
assume.
Lexington Crosby Small Cap Asia Growth Fund, Inc.-Seeks
long-term capital appreciation through investment in
companies domiciled in the Asia Region with a market
capitalization of less than $1 billion.
Lexington Global Fund, Inc.-Seeks long-term growth of
capital primarily through investment in common stocks
of companies domiciled in foreign countries and the
United States.
Lexington International Fund, Inc.-Seeks long-term
growth of capital through investment in companies
domiciled in foreign countries.
Lexington Ramirez Global Income Fund-Seeks high current
income. Capital appreciation is a secondary objective.
The Fund invests in a combination of foreign and
domestic high-yield, lower rated debt securities.
Lexington Goldfund, Inc.-Seeks capital appreciation
through investment in gold bullion and shares of gold
mining companies.
Lexington Growth and Income Fund, Inc.-Seeks capital
appreciation over the long-term through investments in
the stocks of large, ably managed and well financed
companies.
Lexington Corporate Leaders Trust Fund-Seeks capital
growth and reasonable income through investment in an
equal number of shares of an established list of
American blue chip corporations.
Lexington Convertible Securities Fund-Seeks total
return by providing capital appreciation, current
income and conservation of capital through investments
in a diversified portfolio of securities convertible
into shares of common stock.
Lexington GNMA Income Fund, Inc.-Seeks to achieve a
high level of current income, consistent with liquidity
and safety of principal, through investment primarily
in mortgage-backed GNMA ("Ginnie Mae") certificates
that are guaranteed as to the timely payment of
principal and interest by the United States Government.
Lexington Short-Intermediate Government Securities
Fund, Inc.-Seeks current income as is consistent with
the preservation of capital by investing in a portfolio
of U.S. Government Securities with a dollar-weighted
average maturity in its portfolio in a range of two to
five years.
Lexington Money Market Trust-Seeks a high level of
current income consistent with preservation of capital
and liquidity through investments in interest bearing
short-term money market instruments.
Lexington Tax Free Money Fund, Inc.-Seeks current
income exempt from Federal income taxes while
maintaining stability of principal, liquidity and
preservation of capital.
For more complete information about any of the Lexington Funds and a prospectus
which includes management fee and expenses call the distributor toll-free at
1-800-526-0056. Read the prospectus carefully before you invest or send money.
(Left Column)
LEXINGTON
INVESTOR SERVICES
------------------------------------------------------
As a Lexington shareholder, you should be aware of the
many services available to you.
No Load-The Lexington Funds are no load funds. That is,
investments and redemptions are made without any sales
charges, commissions or redemption fees.
----------
Free Telephone Exchange-Investments in the Lexington
Funds may be exchanged for shares of a different
Lexington Fund at any time.
----------
Check Writing Privileges-Lexington Money Market Trust,
Lexington Tax Free Money Fund and Lexington
Short-Intermediate Government Securities Fund permit
investors immediate access to their funds with check
writing for withdrawals from their account.
----------
Tax Sheltered Plans-IRA, Keogh, Pension, and Profit
Sharing Prototype Plans are available to qualified
individuals. These plans offer investment flexibility
through the Share Exchange Service, simplified record
keeping, convenience and investment supervision.
----------
Custodial Accounts for Minors-Investments may be made
on behalf of minors under the Uniform Gifts to Minors
Act currently in effect in all states.
----------
Systematic Withdrawal Plan-An investor may elect to
receive a fixed amount from his or her account each
month or quarter, subject to certain minimums.
----------
Complete Record Keeping-A statement is provided for
every transaction in addition to a year-end statement
with tax information.
14
<PAGE>
(Left Column)
Lexington
Worldwide Emerging Markets Fund, Inc.
Investment Adviser
------------------------------------------------------------
LEXINGTON MANAGEMENT CORPORATION
P.O. Box 1515
Park 80 West Plaza Two
Saddle Brook, New Jersey 07663
Distributor
------------------------------------------------------------
LEXINGTON FUNDS DISTRIBUTOR, INC.
P.O. Box 1515
Park 80 West Plaza Two
Saddle Brook, New Jersey 07663
---------------------------------------------
All shareholder requests for services of
any kind should be sent to:
Transfer Agent
---------------------------------------------
STATE STREET BANK AND
TRUST COMPANY
c/o National Financial Data Services
1004 Baltimore
Kansas City, Missouri 64105
Or call toll free:
Service and Sales: 1-800-526-0056
24 Hour Account Information:
1-800-526-0052
---------------------------------------------
------------------------------------------------------------
(800) 526-0052
"LEXLINE"
24 hour toll-free telephone access to your
Lexington Fund account
Price/Yield * Account Balances * Exchanges *
Last Transactions * Total Return * Duplicate Statements
------------------------------------------------------------
This report has been prepared for the information of
the shareholders of Lexington Worldwide Emerging
Markets Fund, Inc. and is authorized for
distribution to the public only if it is accompanied
or preceded by a currently effective prospectus
which sets forth expenses and other material
information.
(Right Column)
LEXINGTON
-------------------------------------
LEXINGTON
WORLDWIDE
EMERGING
MARKETS
FUND, INC.
(filled box)
Seeks long-term growth of capital
primarily through investment in
equity securities of
companies domiciled in, or doing
business in, emerging countries
and emerging markets.
(filled box)
SEMI-ANNUAL REPORT
JUNE 30, 1995
The Lexington Group
of No Load
Investment Companies
-------------------------------------
