Dear Shareholders:
The Lexington Growth and Income Fund returned 9.8%* for the first six months
of 1995. This compares to a return for the average growth and income fund of
16.8% as reported by Lipper Analytical Services Inc. during the same period.
During the first six months, signs of slower economic growth became more
apparent. Sales of automobiles and existing homes slowed as consumer buying was
restrained by the cumulative impact of higher interest rates put in place in
1994. This slackening in demand led to an unplanned increase in inventory levels
and eventually forced cuts in production rates and job creation. As these excess
inventories were reduced, it put further pressure on the flagging economy. The
result is a slowing in GDP growth, now estimated to be only slightly above 0% in
the second quarter. Once these factors became more evident, the bond market
rallied to new highs reflecting investor anticipation of the need for an
interest rate cut by the Federal Reserve Bank. Equities also reached new high
levels taking their cue from the bond market, also looking ahead to a rate cut
by the Fed to reignite economic growth.
Recently, auto and housing sales have exhibited signs of renewed strength,
responding to lower interest rates for auto loans and mortgages. Despite the
fact that the economy is showing signs of reaching a bottom, we believe that
further modest Fed easing is possible. Such a move should serve to keep market
interest rates low, sustaining the demand for autos and housing. Although we
believe the Fed move has improved the economic outlook for the remainder of 1995
and early 1996, the likelihood of near term earnings disappointments has risen,
reflecting recent slower economic activity. As these earnings shortfalls are
reported it could lead to a volatile environment over the summer months,
especially given the rapid rise and historically high levels of today's equity
markets.
Technology stocks led the very robust market performance in the first half.
We have found it difficult to get many technology stocks through our valuation
screens and thus, have been underweight this sector. While this has negatively
affected our performance to date, our disciplines make us reluctant to chase
this group. Consistent with our outlook for renewed strength in U.S. economic
activity, we have increased our weightings in economically sensitive sectors by
adding to our holdings in retailers, auto related and housing issues, and most
recently the railroads. We believe that valuations here already reflect the
difficult first half environment experienced by these companies, and that the
shares will soon begin to reflect an anticipated better business environment.
With favorable changes in banking regulations we expect to see a continued high
level of merger activity in the banking industry. As a result, we have increased
our weighting of attractively valued regional bank holding companies.
For some time, the Lexington Growth and Income Fund has focused its
investments in companies which, over the last five years, have reduced costs and
streamlined operations. This theme was borne out in the first half. As the
economy slowed and demand eased, these firms reduced labor and other costs at a
rate faster than expected. We are encouraged by the rapid response to slackening
demand that these companies have demonstrated. In our opinion, this will lead to
a quicker profit recovery as the economy resumes its growth.
From a broader perspective, we believe this faster response time will allow
for a more sustainable period of economic expansion. Furthermore, with the
recent cut in interest rates by the Federal Reserve, we believe the stage has
been set for a resumption of modest growth in the quarters ahead. Continued cost
cutting efforts have also put U.S. manufacturers in a better position to compete
against counterparts in Europe and Japan. In many industries, the U.S. is now
the low cost global producer, which, coupled with the low value of the dollar
versus other currencies, places exports from these companies in a very
competitive posture.
During the first half, the U.S. dollar set new record lows against the
German Mark and Japanese Yen. This, we believe, reflected increased speculative
currency trading, persistent trade deficits between the U.S. and its major
trading partners, and the lower interest rate environment produced by the strong
bond market. While a return to
1
<PAGE>
previous levels is not on the immediate horizon, we do expect at least a modest
rebound in the greenback. Thus, despite the attractiveness of some foreign
markets, we have reduced our holdings of foreign ADRs, reflecting the belief
that a stronger U.S. currency would offset positive results from specific
company fundamentals.
At the end of June, the Fund maintained modest cash reserves which we plan
to commit as market conditions warrant, and to take advantage of attractive
individual opportunities as they present themselves.
We appreciate your continued support and would welcome the opportunity to
discuss any questions you may have about your investment.
Sincerely,
Alan H. Wapnick Robert M. DeMichele
Portfolio Manager President
July, 1995 July, 1995
*10.45%, 8.76% and 10.87% are the one, five and ten year average annual standard
total returns, respectively, for the period ended June 30, 1995. 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 their original cost. Total
return represents past performance.
2
<PAGE>
Lexington Growth and Income Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited)
(Left Column)
Number of
Shares or
Principal Value
Amount Security (Note 1)
-------------------------------------------------------------------
COMMON STOCKS: 89.4%
BANKING: 7.8%
34,900 Bank of New York Company, Inc. ...... $ 1,409,088
67,300 Boatmen's Bancshares, Inc. .......... 2,368,119
46,100 Capital One Financial Corporation ... 898,950
58,000 Firstar Corporation*................. 1,950,250
78,800 Signet Banking Corporation .......... 1,723,750
61,500 UJB Financial Corporation*........... 1,868,063
-----------
10,218,220
-----------
BEVERAGE: 2.3%
66,100 PepsiCo, Inc. ....................... 3,015,812
-----------
BUILDING MATERIALS: 1.9%
48,700 Fluor Corporation ................... 2,532,400
-----------
CAPITAL EQUIPMENT: 1.0%
20,300 Boeing Company*...................... 1,271,288
-----------
CHEMICAL (BASIC): 0.9%
51,300 Dexter Coporation ................... 1,211,962
-----------
CHEMICAL (DIVERSIFIED): 2.8%
22,600 Air Products & Chemicals, Inc. ...... 1,259,950
-----------
40,900 Minnesota Mining &
Manufacturing Company ............... 2,341,525
-----------
3,601,475
-----------
COMPUTER SOFTWARE & SERVICES: 1.1%
70,500 Novell, Inc.*........................ 1,405,593
-----------
CONSUMER DURABLE GOODS: 4.3%
47,200 Centex Corporation .................. 1,333,400
63,800 Dana Corporation .................... 1,826,275
60,700 The Goodyear Tire & Rubber Company .. 2,503,875
-----------
5,663,550
-----------
CONSUMER-NON DURABLE GOODS: 6.6%
45,300 CPC International, Inc. ............. 2,797,275
50,500 Duracell International, Inc. ........ 2,184,125
38,700 Forest Laboratories, Inc.*........... 1,717,312
29,600 Nabisco Holdings Corporation ........ 799,200
21,800 Nestle, S.A (ADR)*................... 1,134,357
-----------
8,632,269
-----------
DRUG: 2.7%
14,200 Pfizer, Inc. ........................ 1,311,725
32,200 Bristol-Myers Squibb Company ........ 2,193,625
-----------
3,505,350
-----------
(Right Column)
Number of
Shares or
Principal Value
Amount Security (Note 1)
-------------------------------------------------------------------
ELECTRONICS/ELECTRICAL EQUIPMENT: 6.2%
53,100 Avnet, Inc. ......................... $ 2,568,712
37,400 Grainger (W.W.), Inc. ............... 2,197,250
22,600 General Electric Company ............ 1,274,075
29,600 Motorola, Inc. ...................... 1,986,900
-----------
8,026,937
-----------
ELECTRONICS/ENTERTAINMENT: 0.6%
5,200 Matsushita Electronic Industries (ADR) 806,000
ENERGY SOURCES: 2.2%
49,600 Atlantic Richfield Company .......... 1,289,600
40,900 Burlington Resources, Inc. .......... 1,508,188
-----------
2,797,788
-----------
FINANCIAL SERVICES: 0.3%
7,800 Yamaichi Securities, Ltd. (ADR) ..... 417,101
-----------
HEATING & AIR CONDITIONING: 1.5%
44,400 York International Corporation ...... 1,998,000
-----------
HOUSEHOLD PRODUCTS: 2.8%
25,200 Colgate-Palmolive Company ........... 1,842,750
25,200 Procter & Gamble Company ............ 1,811,250
-----------
3,654,000
-----------
INDUSTRIAL GASES: 1.7%
87,800 Praxair, Inc. ........................ 2,195,000
-----------
INSURANCE: 1.1%
10,400 General Re Corporation ............... 1,392,300
-----------
MACHINERY: 2.5%
51,300 Goulds Pumps, Inc. ................... 1,122,188
56,200 Ingersoll-Rand Company ............... 2,149,650
-----------
3,271,838
-----------
MATERIALS: 2.8%
113,900 Albemarle Corporation ................ 1,779,687
26,500 Du Pont ( E. I.) De Nemours & Company 1,821,875
-----------
3,601,562
-----------
MERCHANDISING: 4.7%
123,600 Borders Group, Inc.*................. 1,776,750
66,500 Lowe's Companies, Inc.*.............. 1,986,688
87,100 Wal-Mart Stores, Inc. ............... 2,329,925
-----------
6,093,363
-----------
3
<PAGE>
Lexington Growth and Income Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited) (continued)
(Left Column)
Number of
Shares or
Principal Value
Amount Security (Note 1)
-------------------------------------------------------------------------
METAL FABRICATING: 2.9%
28,700 Illinois Tool Works, Inc. ................ $ 1,578,500
64,450 Trinity Industries, Inc. ................. 2,142,962
------------
3,721,462
------------
OFFICE EQUIPMENT & SUPPLIES: 1.9%
64,400 Pitney-Bowes, Inc. ....................... 2,471,350
------------
OILFIELD SERVICES/EQUIPMENT: 2.2%
47,000 Halliburton Company ...................... 1,680,250
20,000 Schlumberger, Ltd. ....................... 1,242,500
------------
2,922,750
------------
PAPER & FOREST PRODUCTS: 2.0%
23,200 Union Camp Corporation ................... 1,342,700
14,400 International Paper Company .............. 1,234,800
------------
2,577,500
------------
PERSONAL CARE: 1.9%
54,000 Gillette Company ......................... 2,409,750
------------
PETROLEUM (INTEGRATED): 3.8%
44,100 BJ Services Company*...................... 1,003,275
50,500 Unocal Corporation ....................... 1,395,063
38,300 Texaco, Inc. ............................. 2,513,437
------------
4,911,775
------------
PRECIOUS METALS: 0.3%
33,800 Samancor, Ltd. (ADR) ..................... 441,520
------------
PUBLISHING: 1.0%
17,400 McGraw-Hill Companies .................... 1,320,225
------------
RAILROADS: 0.7%
60,100 Southern Pacific Rail Corporation*........ 946,575
------------
REAL ESTATE: 1.5%
37,400 Chelsea GCA Realty, Inc. ................. 1,009,800
40,900 Horizon Outlet Centers ................... 950,925
------------
1,960,725
------------
RECREATION: 0.8%
18,900 Walt Disney Company ...................... 1,051,312
------------
(Right Column)
Number of
Shares or
Principal Value
Amount Security (Note 1)
-------------------------------------------------------------------------
RETAIL STORES: 4.4%
77,500 Carson Pirie Scott & Company*............. $ 1,269,063
64,400 May Department Stores Company ............ 2,680,650
61,800 Toys "R" Us, Inc.*........................ 1,807,650
------------
5,757,363
------------
STEEL: 2.4%
25,200 Inland Steel Industries, Inc. ............ 768,600
69,600 USX-U.S. Steel Group, Inc. ............... 2,392,500
------------
3,161,100
------------
TELECOMMUNCATIONS: 2.4%
30,500 American Telephone &
Telegraph Company ........................ 1,620,312
70,500 MCI Communications Corporation ........... 1,546,594
------------
3,166,906
------------
TRANSPORTATION: 0.9%
19,100 Burlington Northern, Inc. ................ 1,210,462
------------
UTILITIES: 2.5%
44,400 Brooklyn Union Gas Company ............... 1,165,500
56,600 PacifiCorp ............................... 1,061,250
49,600 Teco Energy, Inc. ........................ 1,085,000
------------
3,311,750
------------
TOTAL COMMON STOCKS
(cost $105,014,280) .................... 116,654,333
------------
CONVERTIBLE CORPORATE BONDS: 2.2%
ENERGY: 2.2%
$2,376,000 Pennzoil Company
6.50% due 01/15/2003
(cost $2,853,030) ..................... 2,815,560
------------
SHORT-TERM INVESTMENTS: 6.1%
5,000,000 U.S. Treasury Bill
5.61% due O8/03/95 ..................... 4,974,288
3,000,000 U.S. Treasury Bill
5.375% due 9/21/95 ..................... 2,963,271
------------
TOTAL SHORT-TERM INVESTMENTS
(cost $7,937,559) ...................... 7,937,559
------------
TOTAL INVESTMENTS: 97.7%
(cost $115,804,869(D)) ................. 127,407,452
Other assets in excess of liabilities: 2.3% 3,054,005
------------
TOTAL NET ASSETS: 100.0%
(equivalent to $15.69 per share on
8,316,090 shares outstanding) ............ $130,461,457
============
ADR-American Depository Receipts.
*Non-income producing securities.
(D)Aggregate cost for Federal Income tax purposes is identical.
The Notes to Financial Statements are an integral part of this statement.
4
<PAGE>
(Left Column)
Lexington Growth and Income Fund, Inc.
Statement of Assets and Liabilities
June 30, 1995 (unaudited)
Assets
Investment in securities, at value
(cost $115,804,869) (Note 1) .................... $127,407,452
Cash .............................................. 1,619,622
Receivable for investment securities sold ......... 1,323,720
Receivable for shares sold ........................ 70,209
Dividends receivable .............................. 291,602
------------
Total Assets .................................... 130,712,605
------------
Liabilities
Due to Lexington Management Corporation
(Note 2) ........................................ 81,272
Accrued expenses .................................. 169,876
------------
Total Liabilities ............................... 251,148
------------
Net Assets (equivalent to $15.69 per share on
8,316,090 shares outstanding) (Note 4) .......... $130,461,457
============
Net Assets consist of:
Capital stock-authorized 500,000,000
shares, $.001 par value per share ............... $ 8,316
Additional paid-in capital ....................... 118,989,577
Undistributed net investment income ............... 306,337
Distributions in excess of net realized gains
on investments .................................. (445,356)
Net unrealized appreciation of investments ........ 11,602,583
------------
$130,461,457
============
(Right Column)
Lexington Growth and Income Fund, Inc.
Statement of Operations
Six months ended June 30, 1995 (unaudited)
Investment Income
Income
Dividends ......................... $ 1,325,853
Interest .......................... 324,610
-----------
1,650,463
Less: foreign tax expense ........... 11,863
-----------
Total investment income ............ $ 1,638,600
Expenses
Investment advisory fee (Note 2) .. 456,272
Accounting and shareholder
services expense (Note 2) ....... 103,082
Custodian and transfer agent
expenses ........................ 36,748
Printing and mailing .............. 36,082
Directors' fees and expenses ...... 5,390
Audit and legal ................... 13,264
Registration fees ................. 13,534
Distribution expenses (Note 3) .... 104,252
Computer processing fees .......... 8,930
Other expenses .................... 23,424
-----------
Total expenses ............... 800,978
-----------
Net investment income ........ 837,622
Realized and Unrealized Gain on Investments
(Note 5)
Realized gain from security
transactions (excluding short-
term securities):
Proceeds from sales ........... 58,346,605
Cost of securities sold ....... 56,854,529
-----------
Net realized gain 1,492,076
Unrealized appreciation of investments:
End of period ................. 11,602,583
Beginning of period ........... 2,076,043
-----------
Change during period .............. 9,526,540
-----------
Net realized and unrealized gain
on investments .................. 11,018,616
-----------
Increase in Net Assets Resulting
from Operations ................... $11,856,238
===========
The Notes to Financial Statements are an integral part of these statements.
5
<PAGE>
(Left Column)
Lexington Growth and Income Fund, Inc.
Statements of Changes in Net Assets
Six months
ended Year ended
June 30, 1995 December 31,
(unaudited) 1994
------------- -----------
Net investment income .......................... $ 837,622 $ 1,410,631
Net realized gain from security
transactions ................................. 1,492,076 7,178,841
Increase (decrease) in unrealized
appreciation of investments .................. 9,526,540 (12,748,337)
Net increase (decrease) in net assets
resulting from operations .................. 11,856,238 (4,158,865)
Distributions to shareholders from net
investment income ............................ (593,781) (1,348,135)
Distributions to shareholders from net
realized gains from security
transactions (Note 1) ........................ - (7,199,281)
Distributions to shareholders in excess of
net realized gains from security
transactions (Note 1) ........................ - (1,937,432)
Increase (decrease) in net assets from
capital share transactions (Note 4) ........... (5,089,668) 4,424,144
Net increase (decrease) in net assets .......... 6,172,789 (10,219,569)
Net Assets
Beginning of period .......................... 124,288,668 134,508,237
End of period (including undistributed
net investment income of $306,337
and $62,496, respectively) (Note 1) ........ $130,461,457 $124,288,668
============ ============
The Notes to Financial Statements are an integral part of these statements.
Lexington Growth and Income Fund, Inc.
Notes to Financial Statements
June 30, 1995 (unaudited) and December 31, 1994
1. Significant Accounting Policies
Lexington Growth and Income 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 by the Fund 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 exchanges on which the securities are traded
(Right Column)
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. Dividend income and distributions to shareholders are recorded on the
ex-dividend date. Interest income is accrued as earned.
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
$29,385 have been reclassified from undistributed net investment income and
distributions in excess of net realized gain to additional paid-in capital.
Distributions 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 some 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.
2. Investment Advisory Fee and Other
Transactions with Affiliate
The Fund pays an investment advisory fee to Lexington Management Corporation
("LMC") at an annual rate of 0.75% of the Fund's average daily net assets up to
$100 million and in decreasing stages to 0.4% of average daily net assets in
excess of $250 million. 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.
6
<PAGE>
Lexington Growth and Income Fund, Inc.
Notes to Financial Statements
June 30, 1995 (unaudited) and December 31, 1994 (continued)
(Left Column)
3. Distribution Plan
The Fund has a Distribution Plan (the "Plan") which allows payments to finance
activities associated with the distribution of the Fund's shares. The plan
provides that the Fund may pay distribution fees on a reimbursement basis,
including payments to Lexington Fund Distributors, Inc. ("LFD"), the Fund's
distributor, in amounts not exceeding .25% per annum of the Fund's average daily
net assets. Total distribution expenses for the six months ended June 30, 1995
were $104,252 which are set forth in the statement of operations.
4. Capital Stock
Transactions in capital stock were as follows:
Six months ended Year ended
June 30, 1995 (unaudited) December 31, 1994
------------------------- ----------------------
Shares Amount Shares Amount
------- ---------- ------- -----------
Shares sold ................ 287,298 $4,348,849 890,121 $14,369,520
Shares issued to share-
holders on reinvest-
ment of dividends ........ 9,916 147,049 640,376 9,254,980
-------- ----------- ---------- -----------
297,214 4,495,898 1,530,497 23,624,500
Shares redeemed ............ (635,079) (9,585,566) (1,199,120) (19,200,356)
-------- ----------- ---------- -----------
Net increase (decrease) .. (337,865) $(5,089,668) 331,377 $ 4,424,144
======== =========== ========== ===========
(Right Column)
5. 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 $53,466,753 and
$58,346,605, respectively.
At June 30, 1995 aggregate gross unrealized appreciation for all securities in
which there is an excess of value over tax cost amounted to $14,101,259 and
aggregate gross unrealized depreciation for all securities in which there is an
excess of tax cost over value amounted to $2,498,676.
6. Investment Risks
The Fund's ability to invest 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.
<TABLE>
--------------------------------------------------------------------------------------------------------------------------
Financial Highlights
Selected per share data for a share outstanding throughout the period:
<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 ................................ $14.36 $16.16 $16.25 $16.39 $14.24
------ ------ ------ ------ ------
Income from investment operations:
Net investment income ............................................. .10 .17 .21 .23 .35
Net realized and unrealized gain (loss) on investments ............ 1.30 (.68) 1.94 1.79 3.17
------ ------ ------ ------ ------
Total income (loss) from investment operations ...................... 1.40 (.51) 2.15 2.02 3.52
------ ------ ------ ------ ------
Less distributions:
Dividends from net investment income .............................. (.07) (.16) (.21) (.32) (.35)
Distributions from net realized capital gains ..................... - (.91) (2.03) (1.84) (1.02)
Distributions in excess of net realized gains (Temporary book-tax .
difference) ..................................................... - (.22) - - -
------ ------ ------ ------ ------
Total distributions ................................................. (.07) (1.29) (2.24) (2.16) (1.37)
------ ------ ------ ------ ------
Net asset value, end of period ...................................... $15.69 $14.36 $16.16 $16.25 $16.39
====== ====== ====== ====== ======
Total return ........................................................ 20.57%* (3.11%) 13.22% 12.36% 24.87%
Ratios to average net assets:
Expenses .......................................................... 1.26%* 1.15% 1.29% 1.20% 1.13%
Net investment income ............................................. 1.32%* 1.06% 1.20% 2.57% 2.19%
Portfolio turnover .................................................. 92.27%* 63.04% 93.90% 88.13% 80.33%
Net assets at end of period (000's omitted) ......................... $130,461 $124,289 $134,508 $126,241 $121,263
*Annualized
</TABLE>
7
<PAGE>
(Left Column)
Lexington
Growth and Income 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 Growth and Income 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
GROWTH
AND
INCOME
FUND, INC.
(filled box)
Seeks capital appreciation over the
long term through investments in
the stocks of large, ably managed
and well financed companies.
(filled box)
SEMI-ANNUAL REPORT
JUNE 30, 1995
The Lexington Group
of No Load
Investment Companies
----------------------------------------
