<PAGE>
[LOGO]
SEMI-ANNUAL REPORT TO SHAREHOLDERS
ADVANTUS HORIZON FUND
MARCH 31, 1995
<PAGE>
ADVANTUS HORIZON FUND
TABLE OF CONTENTS
PERFORMANCE UPDATE 2
INVESTMENTS IN SECURITIES 6
STATEMENT OF ASSETS AND LIABILITIES 9
STATEMENT OF OPERATIONS 10
STATEMENT OF CHANGES IN NET ASSETS 11
NOTES TO FINANCIAL STATEMENTS 12
SHAREHOLDER VOTING RESULTS 17
SHAREHOLDER SERVICES 18
<PAGE>
May 15, 1995
[PHOTO]
Dear Shareholders:
Practically everyone would like to annualize the first quarter results. Both
bonds and equities provided excellent returns for investors according to
Ibbotson Associates. For now, investors seem to have positive expectations on
interest rates and are enjoying the benefits on earnings attributed to the
declining dollar. Additionally, they have become increasingly confident in the
ability of the Federal Reserve to engineer a soft landing (i.e., low inflation
without a recession) for the economy.
For the last six months there was even more good news for the markets. The
November election results combined with two additional Federal Reserve moves to
raise short term interest rates and good news on inflation amid signs of slower
economic growth all helped restore investor confidence.
What can be confusing is that a soft landing and a recession often look very
much the same. The economy is on an unpredictable course, and experts seem to be
particularly divided in their opinions. (Opinions always seem to get farther
apart when markets set new highs.) Bulls argue that earnings are excellent and
will remain healthy because of stringent cost controls and improving overseas
operations. Bears believe the Dow is at its peak for the cycle. Also, the
consensus of a soft landing can be shaken badly if the Fed has to raise interest
rates to protect the dollar. Finally, all signs do not indicate inflation can
remain under control.
There is much evidence that we have entered a period where interest rates,
whether increasing or decreasing, are likely to trade in a narrower range.
Slower but steady economic growth, coupled with a moderate inflationary
environment should prove to be positive for fixed income investments. The
uncertainty in the economy over whether we are heading toward a recession or a
soft landing should create buying opportunities in the equity markets.
The saga of the dollar reaffirms the fact that most events are neither totally
positive nor totally negative. The dollar will buy less in Europe and Japan, but
will buy more in Mexico and Canada than a year ago. However, determining which
investments benefit and which suffer from any event is very difficult and
requires experienced professionals to make the best decisions.
Finally, as always, it is important to remember not to vary from your investment
plan and that diversification across asset types and geographic regions is
important because asset classes tend to perform differently from each other in
different market conditions.
Sincerely,
Paul Gooding, President
Advantus Capital Management, Inc.
<PAGE>
ADVANTUS HORIZON FUND
PERFORMANCE UPDATE
[PHOTO]
JAMES P. TATERA, CFA
SENIOR VICE
PRESIDENT AND
PORTFOLIO MANAGER
The Advantus Horizon Fund is a mutual
fund designed for investors seeking
long-term growth of capital combined with
a moderate level of current income. The
Fund plans to achieve its objective by
investing in equity securities
diversified among individual companies
and industries. The Fund invests
primarily in dividend-paying common
stocks of established companies with
strong long-term outlooks--but may also
invest in companies perceived to be
temporarily undervalued or which because
of new management, products or markets,
show promise of substantially improved
results.
-Dividends paid quarterly.
-Capital gains distributions paid annually.
PERFORMANCE
The Horizon Fund Class A had a good first quarter, returning 7.21 percent (Class
B returned 6.99 percent for the same period).* This compares favorably to the
average Growth Fund** which returned 7.38 percent as reported by Lipper
Analytical Services Inc. For the quarter, the average domestic General Equity
Fund returned 7.16 percent+ which represents the best quarter for equities since
the last three months of 1992. Over the past six months the Horizon Fund Class A
has returned 7.15 percent (Class B returned 6.78 percent for the same period).*
During the quarter, the stock market, defined as the S&P 500, experienced what
many would consider a year's worth of performance. Much of the strength was seen
in the stocks of larger companies. Equity investors have obviously become more
positive on the Federal Reserve's ability to engineer a soft landing. Believing
that the economy's growth was moderating, investors focused on those companies
having relatively visible growth prospects. At the same time, investors have
more positive expectations on interest rates and have focused on the positive
side of the weak dollar--namely, the beneficial import on earnings of U.S.
companies with significant sales coming from foreign markets.
The quarter's strength was seen in those areas represented by large,
multinational companies: technology, health care/drug, energy/oil. Selected
companies like Coca-Cola, McDonalds, and Philip Morris showed individual
strength while the financial group, which is a beneficiary of reduced interest
rates, also performed well.
PORTFOLIO RECAP
For the first time in quite some time, performance for the quarter was
determined by a very diverse group of stocks, not just one or two particular
industries or themes. Top performance was turned in by companies in the
technology, health care, financial, retail, transportation, and restaurant
groups. Familiar names include Intel (semiconductors), Medtronic (pacemakers),
Lone Star Steakhouse (which broke out of a two year trading range recently), and
Wal-Mart Stores (which finally awoke after lackluster performance over the past
year).
Poor performance for the quarter can be grouped into two major areas: consumer
durables, namely auto related, and retailers. Retailers, in particular, proved
frustrating. Investors feel the consumer will (or has) reduced spending in a big
way. We continue to be very comfortable with three companies
2
<PAGE>
ADVANTUS HORIZON FUND
MARCH 31, 1995
which have excellent growth prospects and view the weakness as an opportunity to
buy: Home Depot (building supply retailer), Barnes and Noble (book superstore),
and Office Depot (office supply superstore).
OUTLOOK
Investors seem to be celebrating the much talked about soft landing--moderate
growth with little inflation. Yet the S&P 500's rise to new highs occurred with
a relatively narrow focus of large, multinational companies. If in fact the soft
landing occurs (or is already here), corporate profits also will continue to
soften. This will be good for our style of investing which focuses on those
companies with strong growth rates in revenues and earnings. Typically these
companies are showing improvement versus their peers and their past results.
With approximately 10% of the portfolio assets in cash securities, we are well
positioned to take advantage of opportunities the market presents.
*Historical results are not an indication of future performance. These
performance results do not reflect the impact of Class A's maximum 5 percent
front-end sales charge or Class B's maximum 5 percent contingent deferred sales
charge. Class C commenced operations March 1, 1995, accordingly, performance is
not presented.
**Average of 40 growth funds according to Lipper Analytical Services, Inc.
+Average of 1,748 general equity funds according to Lipper Analytical Services,
Inc.
COMPARISON OF CHANGE IN VALUE OF A HYPOTHETICAL $10,000
INVESTMENT IN ADVANTUS HORIZON FUND, S&P 500
AND CONSUMER PRICE INDEX
CLASS A
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CLASS A SHARES' AVERAGE ANNUAL TOTAL
CLASS A S&P 500 CPI RETURN:
<S> <C> <C> <C> <C> <C> <C>
5/3/85 10000 10000 10000 One year 5.72%
10/31/85 9377 10783 10140 Five year 9.79%
10/31/86 10059 14368 10299 Since inception (05/03/85) 9.48%
10/31/87 10682 15282 10757
10/31/88 11885 17560 11215
10/31/89 14538 22178 11729
10/31/90 13692 20515 12467
10/31/91 19015 27386 12832
10/31/92 20974 30110 13243
10/31/93 22560 34599 13598
9/30/94 22883 35098 14009
3/31/95 24541 38524 14150
</TABLE>
On the chart above you can see how the Advantus Horizon Fund Class A shares'
total return compared to the Dividend Adjusted S&P 500 and the Consumer Price
Index. The three lines represent the cumulative total return of a hypothetical
$10,000 investment made on inception date of the Advantus Horizon Fund Class A
shares (May 3, 1985) through March 31, 1995.
3
<PAGE>
ADVANTUS HORIZON FUND
MARCH 31, 1995
CLASS B
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CLASS B SHARES TOTAL
CLASS B S&P 500 CPI RETURN
<S> <C> <C> <C> <C> <C>
Since inception
8/19/94 10000 10000 10000 (08/19/94) 3.15%
9/30/94 10129 9951 10067
3/31/95 10315 10922 10168
</TABLE>
On the chart above you can see how the Advantus Horizon Fund Class B shares'
total return compared to the Dividend Adjusted S&P 500 and the Consumer Price
Index. The three lines represent the cumulative total return of a hypothetical
$10,000 investment made on inception date of the Advantus Horizon Fund Class B
shares (August 19, 1994) through March 31, 1995.
The above charts are useful because they provide you with more information about
your investments. There are limitations, however. An index may reflect the
performance of securities that the Fund may not hold. Also, the index does not
deduct sales charges, investment advisory fees and other fund expenses, whereas
your Fund does. Performance presented for the Fund reflects the deduction of the
maximum 5 percent front-end sales charge for Class A and the maximum 5 percent
contingent deferred sales charge for Class B. Individuals cannot buy even an
unmanaged index fund without incurring some charges and expenses. Sales charges
pay for your financial adviser's investment advice.
Historical results are not an indication of future performance
4
<PAGE>
ADVANTUS HORIZON FUND
MARCH 31, 1995
TEN LARGEST STOCK HOLDINGS
<TABLE>
<CAPTION>
MARKET % OF STOCK
COMPANY SHARES VALUE PORTFOLIO
- - ---------------------------- ----------- --------- ---------------
<S> <C> <C> <C> <C>
Columbia/HCA Healthcare
Corporation............... 25,381 $1,091,383 3.6%
First Financial
Management................ 14,500 1,047,625 3.4%
Office Depot, Inc........... 40,782 994,061 3.3%
CUC International Inc....... 23,898 929,035 3.0%
General Electric Company.... 16,988 919,476 3.0%
Medtronic Inc............... 12,400 860,250 2.8%
DSC Communications.......... 25,100 817,319 2.7%
Pyxis Corporation........... 36,100 749,075 2.5%
Intel....................... 8,600 729,925 2.4%
Roosevelt Financial Group,
Inc....................... 45,200 711,900 2.3%
--------- ---
$8,850,049 29.0%
--------- ---
--------- ---
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Consumer Goods and Services 43.4
Credit Sensitive 13.3
Technology 13.4
Cash and Other
Assets/Liabbilities 12.1
Intermediate Goods and Services 10.4
Capital Goods 7.4
</TABLE>
5
<PAGE>
ADVANTUS HORIZON FUND
INVESTMENTS IN SECURITIES
MARCH 31, 1995
(UNAUDITED)
(Percentages of each investment category relate to total net assets.)
<TABLE>
<CAPTION>
MARKET
SHARES VALUE(A)
- - ---------- ----------
<C> <S> <C>
COMMON STOCKS (87.9%)
CAPITAL GOODS (7.4%)
Machinery (7.4%)
19,300 Elsag Bailey Process Automation (b)(c)................. $ 540,400
16,988 General Electric Company............................... 919,476
13,400 Kaydon Corporation..................................... 353,425
36,100 Pyxis Corporation (b).................................. 749,075
----------
2,562,376
----------
CONSUMER GOODS AND SERVICES (43.4%)
Consumer Goods (14.9%)
25,381 Columbia/HCA Healthcare Corporation.................... 1,091,383
22,120 Fisher Scientific International Inc.................... 658,070
13,200 Idexx Laboratories Inc. (b)............................ 547,800
12,400 Medtronic Inc.......................................... 860,250
8,981 Pepsico, Inc........................................... 350,259
5,100 Pfizer Inc............................................. 437,325
3,200 Procter & Gamble Company............................... 212,000
10,200 United Health Care..................................... 476,850
14,000 Value Health Incorporated (b).......................... 535,500
----------
5,169,437
----------
Consumer Services (13.2%)
21,800 Carmike Cinemas Inc. (b)............................... 430,550
23,898 CUC International Inc. (b)............................. 929,035
<CAPTION>
MARKET
SHARES VALUE(A)
- - ---------- ----------
<C> <S> <C>
CONSUMER GOODS AND SERVICES--CONTINUED
14,700 Danka Business Systems PLC (c)......................... $ 385,875
15,400 Gartner (b)............................................ 662,200
11,400 GTECH Holdings Corporation (b)......................... 246,525
16,000 International House of Pancakes (b).................... 471,000
12,800 Lone Star Steakhouse & Saloon, Inc. (b)................ 347,200
19,370 Manpower............................................... 622,261
10,000 The Readers Digest Association, Inc.................... 481,250
----------
4,575,896
----------
Retail (10.5%)
13,000 Barnes & Noble Inc. (b)................................ 394,875
44,200 Casey's General Stores Inc............................. 701,675
14,600 The Home Depot, Inc.................................... 646,050
3,800 Kohl's Inc. (b)........................................ 168,150
40,782 Office Depot, Inc. (b)................................. 994,061
20,600 Orchard Supply Hardware (b)............................ 200,850
21,580 Wal-Mart Stores, Inc................................... 550,290
----------
3,655,951
----------
Consumer Cyclicals (4.8%)
9,690 Exide Corporation...................................... 356,107
21,300 Foamex International Inc. (b).......................... 170,400
29,100 Sunbeam-Oster Co....................................... 665,663
</TABLE>
See accompanying notes to investments in securities.
6
<PAGE>
ADVANTUS HORIZON FUND
INVESTMENTS IN SECURITIES--CONTINUED
<TABLE>
<CAPTION>
MARKET
SHARES VALUE(A)
- - ---------- ----------
<C> <S> <C>
CONSUMER GOODS AND SERVICES--CONTINUED
22,400 Tommy Hilfiger Corporation (b)(c)...................... $ 492,800
----------
1,684,970
----------
CREDIT SENSITIVE (13.3%)
Finance (10.2%)
4,368 American Internationl Group, Inc....................... 455,364
7,600 First Data Corp........................................ 394,250
14,500 First Financial Management............................. 1,047,625
6,805 First Union Corporation................................ 295,167
9,000 MGIC Investment Corporation............................ 366,750
11,350 Norwest Corporation.................................... 288,006
45,200 Roosevelt Financial Group, Inc......................... 711,900
----------
3,559,062
----------
Utilities (3.1%)
11,600 AT & T Corp............................................ 600,300
8,175 Florida Progress Corporation........................... 246,272
8,409 Telefonos de Mexico ADR (c)............................ 239,656
----------
1,086,228
----------
<CAPTION>
MARKET
SHARES VALUE(A)
- - ---------- ----------
<C> <S> <C>
INTERMEDIATE GOODS AND SERVICES (10.4%)
Energy (2.8%)
4,450 Amoco Corporation...................................... $ 283,131
3,800 Mobil Corporation...................................... 351,975
2,860 Royal Dutch Petroleum (c).............................. 343,200
----------
978,306
----------
Materials (4.1%)
9,530 Albany International Corp.............................. 179,879
19,200 Lubrizol Corporation................................... 676,800
19,173 McWhorter Technology Inc. (b).......................... 306,768
7,240 The Valspar Corporation................................ 268,785
----------
1,432,232
----------
Transportation (3.5%)
30,400 American Freightways (b)............................... 691,600
3,800 Fritz Companies (b).................................... 244,150
3,940 Norfolk Southern Corporation........................... 263,488
----------
1,199,238
----------
TECHNOLOGY (13.4%)
5,983 Computer Associates International...................... 355,241
25,100 DSC Communications (b)................................. 817,319
9,000 Informix Corporation (b)............................... 309,375
15,700 Integrated Device Technology, Inc. (b)................. 580,900
8,600 Intel.................................................. 729,925
</TABLE>
See accompanying notes to investments in securities.
7
<PAGE>
ADVANTUS HORIZON FUND
INVESTMENTS IN SECURITIES--CONTINUED
<TABLE>
<CAPTION>
MARKET
SHARES VALUE(A)
- - ---------- ----------
<C> <S> <C>
TECHNOLOGY--CONTINUED
5,064 Microsoft Corporation (b).............................. $ 360,177
5,680 Minnesota Mining and Manufacturing Company............. 330,150
19,900 Newbridge Networks Corporation (b)(c).................. 651,725
<CAPTION>
MARKET
SHARES VALUE(A)
- - ---------- ----------
<C> <S> <C>
TECHNOLOGY--CONTINUED
16,150 Oracle Systems Corporation (b)......................... $ 504,687
----------
4,639,499
----------
Total common stocks (cost: $22,356,553)................ 30,543,195
----------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
- - ----------
<C> <S> <C> <C> <C>
SHORT-TERM SECURITIES (12.6%)
$ 300,000 Federal National Mortgage Association Discount Note.... 6.030% 04/28/95 298,614
60,000 U.S. Treasury Bill..................................... 5.710% 04/06/95 59,942
1,575,000 U.S. Treasury Bill..................................... 5.77%-5.93% 05/11/95 1,564,776
200,000 U.S. Treasury Bill..................................... 5.890% 06/01/95 198,026
1,155,000 U.S. Treasury Bill..................................... 5.81%-5.85% 06/01/95 1,143,615
400,000 Ford Motor Credit CP................................... 6.130% 05/09/95 397,426
700,000 R.R. Donnelley & Sons Company CP....................... 6.100% 04/26/95 696,997
-----------
Total short-term securities (cost: $4,359,338)...................................... 4,359,396
-----------
Total investments in securities (cost: $26,715,891) (d)............................. $34,902,591
-----------
-----------
<FN>
Notes to Investments in Securities
(a) Securities are valued by procedures described in note 2 to the financial
statements.
(b) Presently non-income producing.
(c) The Fund held 7.6% of net assets in foreign securities as of March 31,
1995.
(d) At March 31, 1995 the cost of securities for federal income tax purposes
was $26,762,729. The aggregate unrealized appreciation and depreciation of
investments in securities based on this cost were:
Gross unrealized appreciation........................................................................ $ 9,139,183
Gross unrealized depreciation........................................................................ (999,321)
-----------
Net unrealized appreciation.......................................................................... $ 8,139,862
-----------
-----------
</TABLE>
8
<PAGE>
ADVANTUS HORIZON FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1995
(UNAUDITED)
<TABLE>
<S> <C>
ASSETS
Investments in securities, at market value--see accompanying schedule for
detailed listing (identified cost: $26,715,891)................................ $ 34,902,591
Cash in bank on demand deposit.................................................. 4,509
Receivable for Fund shares sold................................................. 21,509
Receivable for investment securities sold....................................... 115,421
Accrued interest and dividends receivable....................................... 17,103
------------
Total assets................................................................ 35,061,133
------------
LIABILITIES
Payable for investment securities purchased..................................... 285,399
Payable for Fund shares repurchased............................................. 2,156
Payable to Adviser.............................................................. 40,985
------------
Total liabilities........................................................... 328,540
------------
Net assets applicable to outstanding capital stock.............................. $ 34,732,593
------------
------------
Represented by:
Capital stock--$.01 par value (note 1)........................................ $ 19,302
Additional paid-in capital.................................................... 25,609,421
Undistributed net investment loss............................................. (23,232)
Accumulated net realized gains from investments............................... 940,402
Unrealized appreciation of investments........................................ 8,186,700
------------
Total--representing net assets applicable to outstanding capital stock...... $ 34,732,593
------------
------------
Net assets applicable to outstanding Class A Shares............................. $ 33,833,784
------------
------------
Net assets applicable to outstanding Class B Shares............................. $ 885,114
------------
------------
Net assets applicable to outstanding Class C Shares............................. $ 13,695
------------
------------
Shares outstanding and net asset value per share:
Class A--Shares outstanding 1,880,044......................................... $ 18.00
------------
------------
Class B--Shares outstanding 49,434............................................ $ 17.91
------------
------------
Class C--Shares outstanding 765............................................... $ 17.91
------------
------------
</TABLE>
See accompanying notes to financial statements.
9
<PAGE>
ADVANTUS HORIZON FUND
STATEMENT OF OPERATIONS
PERIOD FROM OCTOBER 1, 1994 TO MARCH 31, 1995
(UNAUDITED)
<TABLE>
<S> <C>
Investment income:
Interest...................................................................... $ 61,485
Dividends..................................................................... 151,485
-----------
Total investment income..................................................... 212,970
-----------
Expenses (note 4):
Investment advisory fee....................................................... 129,277
Distribution fees--Class A.................................................... 47,669
Distribution fees--Class B.................................................... 2,677
Distribution fees--Class C.................................................... 9
Administrative services fee................................................... 20,000
Custodian fees................................................................ 3,157
Auditing and accounting services.............................................. 9,500
Legal fees.................................................................... 3,571
Directors' fees............................................................... 325
Registration fees............................................................. 18,723
Printing and shareholder reports.............................................. 12,423
Insurance..................................................................... 2,995
Other......................................................................... 9,708
-----------
Total expenses.............................................................. 260,034
Less fees and expenses waived or absorbed:
Class A distribution fees................................................... (23,832)
-----------
Total net expenses.......................................................... 236,202
-----------
Investment loss--net........................................................ (23,232)
-----------
Realized and unrealized gains on investments:
Net realized gains on investments (note 3).................................... 1,224,813
Net change in unrealized appreciation or depreciation on investments.......... 1,135,067
-----------
Net gains on investments.................................................... 2,359,880
-----------
Net increase in net assets resulting from operations............................ $ 2,336,648
-----------
-----------
</TABLE>
See accompanying notes to financial statements.
10
<PAGE>
ADVANTUS HORIZON FUND
STATEMENT OF CHANGES IN NET ASSETS
PERIOD FROM OCTOBER 1, 1994 TO MARCH 31, 1995 AND
PERIOD FROM NOVEMBER 1, 1993 TO SEPTEMBER 30, 1994
(UNAUDITED)
<TABLE>
<CAPTION>
1995 1994
------------ ------------
<S> <C> <C>
Operations:
Investment loss--net................................................ $ (23,232) (3,911)
Net realized gains on investments................................... 1,224,813 736,521
Net change in unrealized appreciation or depreciation of
investments........................................................ 1,135,067 (290,620)
------------ ------------
Increase in net assets resulting from operations.................. 2,336,648 441,990
------------ ------------
Distributions to shareholders from net realized gains on investments:
Class A........................................................... (981,839) (940,050)
Class B........................................................... (16,194) --
------------ ------------
Total distributions............................................... (998,033) (940,050)
------------ ------------
Capital share transactions (notes 4 and 5):
Proceeds from sales:
Class A........................................................... 2,079,558 4,972,723
Class B........................................................... 766,370 96,045
Class C........................................................... 13,536 --
Shares issued as a result of reinvested dividends:
Class A........................................................... 973,245 917,268
Class B........................................................... 16,194 --
Payments for redemption of shares:
Class A........................................................... (1,909,620) (4,018,515)
Class B........................................................... (29,605) (10)
------------ ------------
Increase in net assets from capital share transactions............ 1,909,678 1,967,511
------------ ------------
Total increase in net assets...................................... 3,248,293 1,469,451
Net assets at beginning of period..................................... 31,484,300 30,014,849
------------ ------------
Net assets at end of period........................................... $ 34,732,593 31,484,300
------------ ------------
------------ ------------
</TABLE>
See accompanying notes to financial statements.
11
<PAGE>
ADVANTUS HORIZON FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1995
(UNAUDITED)
(1) ORGANIZATION
The Advantus Horizon Fund, Inc. (the Fund) is registered under the
Investment Company Act of 1940 (as amended) as a diversified, open-end
management investment company. On February 14, 1995 shareholders of the Fund
approved a name change to Advantus Horizon Fund, Inc. (effective March 1, 1995).
Prior to March 1, 1995 the Fund was known as MIMLIC Investors Fund I, Inc.
The Fund currently issues three classes of shares: Class A, Class B and
Class C shares. Class A shares are sold subject to a front-end sales charge.
Class B shares are sold subject to a contingent deferred sales charge payable
upon redemption if redeemed within six years of purchase. Class C shares are
sold without either a front-end sales charge or a contingent deferred sales
charge. Both Class B and Class C are subject to a higher Rule 12b-1 fee than
Class A shares. Both Class B and Class C shares automatically convert to Class A
shares at net asset value after a specified holding period. Such holding period
declines as the amount of the purchase increases and ranges from 28 to 84 months
after purchase for Class B shares and 40 to 96 months after purchase for Class C
shares. All three classes of shares have identical voting, dividend, liquidation
and other rights and the same terms and conditions, except that the level of
distribution fees charged differs between Class A, Class B and Class C shares.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies followed by the Fund are summarized as
follows:
INVESTMENTS IN SECURITIES
Investments in securities traded on a national exchange are valued at the
last sales price on that exchange prior to the time when assets are valued;
securities traded in the over-the-counter market and listed securities for which
no sale was reported on that date are valued on the basis of the last current
bid price. When market quotations are not readily available, securities are
valued at fair value as determined in good faith by the Board of Directors. Such
fair values are determined using pricing services or prices quoted by
independent brokers. Short-term securities are valued at market.
Security transactions are accounted for on the date the securities are
purchased or sold. Realized gains and losses are calculated on the
identified-cost basis. Dividend income is recognized on the ex-dividend date and
interest income, including amortization of bond premium and discount computed on
a level yield basis, is accrued daily.
FEDERAL TAXES
The Fund's policy is to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
taxable income to shareholders. Therefore, no income tax provision is required.
The Fund's policy is to make required minimum distributions prior to December
31, in order to avoid federal excise tax.
12
<PAGE>
NOTES TO FINANCIAL STATEMENTS--CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
Net investment income and net realized gains (losses) may differ for
financial statement and tax purposes primarily because of temporary book-to-tax
differences. The character of distributions made during the year from net
investment income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. Also, due to the timing of
dividend distributions, the fiscal year in which amounts are distributed may
differ from the year that the income or realized gains (losses) were recorded by
the Fund.
DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income are declared and paid quarterly.
Realized gains, if any, are paid annually.
(3) INVESTMENT SECURITY TRANSACTIONS
For the period from October 1, 1994 to March 31, 1995, purchases of
securities and proceeds from sales, other than temporary investments in
short-term securities aggregated $6,797,563 and $8,072,546, respectively.
(4) EXPENSES AND RELATED PARTY TRANSACTIONS
On February 14, 1995 shareholders of the Fund approved a new investment
advisory agreement, effective March 1, 1995, with Advantus Capital Management,
Inc. (Advantus Capital or the Adviser). Advantus Capital is a wholly-owned
subsidiary of MIMLIC Asset Management Company (MIMLIC Management) which, prior
to March 1, 1995, served as investment adviser to the Fund. Under the agreement,
Advantus Capital manages the Fund's assets and provides research, statistical
and advisory services and pays related office rental and executive expenses and
salaries. In addition, as part of the advisory fee, Advantus Capital pays the
expenses of the Fund's transfer, dividend disbursing and redemption agent (The
Minnesota Mutual Life Insurance Company (Minnesota Mutual), the parent of MIMLIC
Management). The fee for investment management and advisory services is based on
the average daily net assets of the Fund at the annual rate of .80 percent,
which is the same as under the old agreement with MIMLIC Management.
The Fund has adopted separate Plans of Distribution applicable to Class A,
Class B and Class C shares, respectively, relating to the payment of certain
distribution expenses pursuant to Rule 12b-1 under the Investment Company Act of
1940 (as amended). The Fund pays distribution fees to MIMLIC Sales Corporation
(MIMLIC Sales), the underwriter of the Fund, to be used to pay certain expenses
incurred in the distribution, promotion and servicing of the Fund's shares. The
Class A Plan provides for a fee up to .30 percent of average daily net assets of
Class A shares. The Class B Plan provides for a fee up to 1.00 percent of
average daily net assets of Class B shares. The Class B 1.00 percent fee is
comprised of a .75 percent distribution fee and a .25 percent service fee. The
Class C Plan provides for a fee of up to 1.00 percent of average daily net
assets of Class C shares. The Class C 1.00 percent fee is comprised of a .75
percent distribution fee and a .25 percent service fee. MIMLIC Sales is
currently waiving that portion of Class A distribution fees which exceeds, as a
percentage of average daily net assets, .15 percent.
13
<PAGE>
NOTES TO FINANCIAL STATEMENTS--CONTINUED
(4) EXPENSES AND RELATED PARTY TRANSACTIONS--(CONTINUED)
The Fund also bears certain other operating expenses including outside
directors' fees, custodian fees, registration fees, printing and shareholder
reports, legal, auditing and accounting services and other miscellaneous
expenses.
The Fund pays an administrative services fee to Minnesota Mutual for
accounting, auditing, legal and other administrative services which Minnesota
Mutual provides. Prior to February 1, 1995, the administrative service fee was
$3,450 per month. Effective February 1, 1995, the administrative service fee is
$3,100 per month.
Advantus Capital (MIMLIC Management prior to March 1, 1995) directly incurs
and pays the above operating expenses and the Fund in turn reimburses Advantus
Capital.
Sales charges received by MIMLIC Sales for distributing the Fund's three
classes of shares amounted to $61,090.
As of March 31, 1995, Minnesota Mutual and subsidiaries, and the directors
and officers of the Fund as a whole own the following shares:
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENTAGE OWNED
------------------ -------------------
<S> <C> <C>
Class A..................................................................... 688,039 36.6%
Class B..................................................................... 3,025 6.1%
Class C..................................................................... 569 74.4%
</TABLE>
Legal fees were paid to a law firm of which the Fund's secretary is a
partner in the amount of $3,187.
(5) CAPITAL SHARE TRANSACTIONS
Transactions in shares for the period from October 1, 1994 to March 31, 1995
and the period from November 1, 1993 to September 30, 1994 for Class A shares,
the period from October 1, 1994 to March 31, 1995 and the period August 19, 1994
to September 30, 1994 for Class B shares and the period from March 1, 1995 to
March 31, 1995 for Class C shares were as follows:
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
---------------------- -------------------- -----------
1995 1994 1995 1994 1995
---------- ---------- --------- --------- -----------
<S> <C> <C> <C> <C> <C>
Sold............................................................. 120,585 290,469 44,233 5,594 765
Issued for reinvested distributions.............................. 59,591 53,235 1,084 -- --
Redeemed......................................................... (110,707) (234,962) (1,476) (1) --
---------- ---------- --------- --------- ---
69,469 108,742 43,841 5,593 765
---------- ---------- --------- --------- ---
---------- ---------- --------- --------- ---
</TABLE>
14
<PAGE>
NOTES TO FINANCIAL STATEMENTS--CONTINUED
(6) FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
-------------------------------------------------------------------
PERIOD FROM PERIOD FROM
OCTOBER 1, NOVEMBER 1,
1994 TO 1993 TO YEAR ENDED OCTOBER 31,
MARCH 31, SEPTEMBER ----------------------------------
1995 30, 1994 1993 1992 1991 1990
----------- ------------ ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period...... $ 17.34 $ 17.64 $ 16.73 $ 15.65 $ 11.41 $ 12.79
----------- ------------ ------- ------- ------- -------
Income from investment operations:
Net investment income (loss)............ (.04) -- .05 .10 .17 .20
Net gains or losses on securities (both
realized and unrealized)............... 1.24 .25 1.20 1.47 4.25 (.90)
----------- ------------ ------- ------- ------- -------
Total from investment operations...... 1.20 .25 1.25 1.57 4.42 (.70)
----------- ------------ ------- ------- ------- -------
Less distributions:
Dividends from net investment income.... -- -- (.05) (.12) (.18) (.21)
Distributions from capital gains........ (.54) (.55) (.29) (.37) -- (.47)
----------- ------------ ------- ------- ------- -------
Total distributions................... (.54) (.55) (.34) (.49) (.18) (.68)
----------- ------------ ------- ------- ------- -------
Net asset value, end of period............ $ 18.00 $ 17.34 $ 17.64 $ 16.73 $ 15.65 $ 11.41
----------- ------------ ------- ------- ------- -------
----------- ------------ ------- ------- ------- -------
Total return (a).......................... 7.25%(b) 1.43%(c) 7.56% 10.30% 38.87% (5.82)%
Net assets, end of period (in thousands).. $33,834 $31,387 $30,015 $24,919 $17,608 $11,675
Ratio of expenses to average daily net
assets (e)............................... 1.45%(d) 1.43%(d) 1.31% 1.40% 1.36% 1.25%
Ratio of net investment income (loss) to
average daily net assets (e)............. (.13)%(d) (.01)%(d) .27% .61% 1.20% 1.62%
Portfolio turnover rate (excluding short-
term securities)......................... 22.58% 43.54% 46.97% 20.56% 16.85% 32.48%
<FN>
- - ----------
(a) Total return figures are based on a share outstanding throughout the period
and assumes reinvestment of distributions at net asset value. Total return
figures do not reflect the impact of sales charges.
(b) Total return is presented for the period from October 1, 1994 to March 31,
1995.
(c) Total return is presented for the period from November 1, 1993 to September
30, 1994.
(d) Adjusted to an annual basis.
(e) The Fund's Adviser and Distributor voluntarily waived or absorbed $23,832,
$51,147, $48,807, $32,341, and $22,098 in expenses for the periods ended
March 31, 1995 and September 30, 1994 and the years ended October 31, 1993,
1992 and 1991, respectively. If Class A shares had paid all fees and
expenses the ratio of expenses to average daily net assets would have been
1.60%, 1.61%, 1.49%, 1.55% and 1.54%, respectively, and the ratio of net
investment income to average daily net assets would have been (.28)%,
(.19)%, .09%, .46% and 1.02%, respectively.
</TABLE>
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS--CONTINUED
(6) FINANCIAL HIGHLIGHTS--(CONTINUED)
<TABLE>
<CAPTION>
CLASS B CLASS C
------------------------------ ------------
PERIOD FROM PERIOD FROM PERIOD FROM
OCTOBER 1, AUGUST 19, MARCH 1,
1994 TO 1994(A) TO 1995(A) TO
MARCH 31, SEPTEMBER MARCH 31,
1995 30, 1994 1995
------------ ------------ ------------
<S> <C> <C> <C>
Net asset value, beginning of period................................... $ 17.33 $ 17.11 $ 17.52
------ ------ ------
Income from investment operations:
Net investment income (loss)......................................... (.05) (.01) (.01)
Net gains or losses on securities (both realized and unrealized)..... 1.17 .23 .40
------ ------ ------
Total from investment operations................................... 1.12 .22 .39
------ ------ ------
Less distributions:
Dividends from net investment income................................. -- -- --
Distributions from capital gains..................................... (.54) -- --
------ ------ ------
Total distributions................................................ (.54) -- --
------ ------ ------
Net asset value, end of period......................................... $ 17.91 $ 17.33 $ 17.91
------ ------ ------
------ ------ ------
Total return (b)....................................................... 6.78%(c) 1.29%(d) 1.94%(e)
Net assets, end of period (in thousands)............................... $ 885 $ 97 $ 14
Ratio of expenses to average daily net assets (h)...................... 2.26%(f) .30%(g) .19%(g)
Ratio of net investment income (loss) to average daily net assets (h).. (.95)%(f) (.13)%(g) (.10)%(g)
Portfolio turnover rate (excluding short-term securities).............. 22.58% 43.54% 22.58%
<FN>
- - ----------
(a) Commencement of operations.
(b) Total return figures are based on a share outstanding throughout the period
and assumes reinvestment of distributions at net asset value. Total return
figures do not reflect the impact of sales charges.
(c) Total return is presented for the period from October 1, 1994 to March 31,
1995.
(d) Total return is presented for the period from August 19, 1994, commencement
of operations, to September 30, 1994.
(e) Total return is presented for the period from March 1, 1995, commencement
of operations, to March 31, 1995.
(f) Adjusted to an annual basis.
(g) Ratios presented for the periods from March 1, 1995 to March 31, 1995 and
August 19, 1994 to September 30, 1994 are not annualized as they are not
indicative of anticipated results.
</TABLE>
16
<PAGE>
SHAREHOLDER VOTING RESULTS
On February 14, 1995 a regular shareholder meeting was held. Shareholders of
record on December 19, 1994 were entitled to vote on the proposals described
below. All classes of shares (only Class A and Class B were in existence on
December 19, 1994) of the Fund were entitled to vote on each proposal, and all
shares were voted in the aggregate for each proposal and not by class.
(1) To elect a Board of Directors as follows:
<TABLE>
<CAPTION>
VOTES VOTES
DIRECTOR FOR WITHHELD
- - ------------------------------------------------------------------------- --------- -----------
<S> <C> <C>
Paul H. Gooding.......................................................... 1,227,212 8,372
Frederick P. Feuerherm................................................... 1,227,212 8,601
Ralph D. Ebbott.......................................................... 1,227,212 19,524
Ellen S. Berscheid....................................................... 1,227,212 16,850
Charles E. Arner......................................................... 1,227,212 17,488
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF SHARES VOTING
---------------------------
FOR AGAINST ABSTAIN
--------- ------- -------
<C> <S> <C> <C> <C>
(2) To ratify or reject the selection by the Board of Directors
of
KPMG Peat Marwick LLP as the independent public accountant
for the Fund for the fiscal year ending September 30,
1995........................................................ 1,222,282 5,134 7,558
(3) To approve or reject the proposal to amend the Fund's
Articles of
Incorporation to change the name of the Fund from MIMLIC
Investors Fund I, Inc. to Advantus Horizon Fund, Inc........ 1,205,288 18,668 11,019
(4) To approve or disapprove a new Investment Advisory Agreement
with Advantus Capital Management, Inc., a wholly-owned
subsidiary of MIMLIC Asset Management Company, the previous
investment adviser of the Fund.............................. 1,200,836 22,754 11,385
</TABLE>
17
<PAGE>
SHAREHOLDER SERVICES
The Advantus Family of Funds offers a variety of services that enhance your
ability to manage your assets. Check each Fund's prospectus for the details of
the services and any limitations that apply to a particular Fund:
EXCHANGE PRIVILEGES: You can move all or part of your investment dollars from
one fund to any other Advantus Fund you own (for identical registrations within
the same class) at any time as your needs change. Exchanges are at the then
current net asset value. (Exchanges from the Money Market Fund will incur the
applicable sales charge, if not previously subjected to the charge.)
Shareholders may make four exchanges or telephone transfers between the Funds
each calendar year without incurring a transaction charge. Thereafter, there
will be a $7.50 transaction charge for each additional exchange or transfer
within the calendar year. Systematic Exchange Plans are exempt from this charge.
INCOME DISTRIBUTION FLEXIBILITY: You can have your fund dividends and other
distributions automatically reinvested with no sales charge, direct them from
one Advantus Fund to any other you own within the Fund family or, if you desire,
we'll pay you in cash.
SYSTEMATIC WITHDRAWAL PLAN: You can set up a plan to receive checks at
specified intervals from you fund account--subject to minimum guidelines.
DIRECT DEPOSITS: At your request we will deposit your dividends or systematic
withdrawals directly into your checking or savings account instead of sending
you a check.
TELEPHONE TRANSFER: You may transfer money from one Advantus account to any
other Advantus account you own just by calling our toll free number. Sign up for
telephone exchanges on the Advantus Application or complete the telephone
authorization form.
SYSTEMATIC TRANSFER: If you have an Advantus Money Market account you may
transfer a set amount of money to another Advantus Fund to diversify your
investment portfolio and take advantage of dollar-cost averaging.
AUTOMATIC PAYMENT OF INSURANCE PREMIUMS: You may automatically pay your
Minnesota Mutual insurance premiums out of an Advantus Money Market account.
REDUCED SALES CHARGES: Letter of Intent, combined purchases with spouse,
children or single trust estates, and the Right of Accumulation make it possible
for you to reduce the sales charge on Advantus's non-money market funds.
SPECIAL PURCHASE PLANS: Our special purchase plans enable you to open an
Advantus fund account for as little as $25 and lower your average share cost
through "dollar-cost averaging." (Dollar-cost averaging does not assure a
profit, nor does it prevent loss in declining markets.) One of these plans--The
Automatic Investment Plan--allows you to invest automatically each month from
your checking or saving account.
IRAS, OTHER QUALIFIED PLAN: You can use the Advantus Family of Funds for your
Individual Retirement Account or other qualified plan including SEPs, profit
sharing, money purchase or defined benefit plans.
GROUP INVESTMENT PLAN: This plan provides employers and employees with a
convenient means for investing in the funds through payroll deduction.
18
<PAGE>
TELEPHONE REDEMPTION: You may call us and redeem shares over the phone. Amounts
over $1,000 will be wire transferred to your personal bank account. The
prevailing wire charge will be added to the withdrawal amount. Amounts for less
than $1,000 will be mailed to your bank on your behalf. To set this up, please
send a voided check from your bank.
ACCOUNT UPDATES: You'll receive written confirmation of every investment you
initiate (monthly statements for your Money Market account) and quarterly
reports to help you track all of your investments in the Advantus Family of
Funds, and annual tax statements. Semiannual and annual reports will provide you
with portfolio information, fund performance data and the current investment
outlook.
TOLL-FREE SERVICE LINE: For your convenience in obtaining information and
assistance directly from MIMLIC Sales Corporation, call 1-800-443-3677. Our
voice response system is available from 7 a.m. to 3 a.m. Monday through Friday,
and 8 a.m. to 5 p.m. on Saturday. This system allows you to access current net
asset values and your account balances.
HOW TO INVEST
You can invest in one or more of the eight Advantus Funds through your local
registered representative of MIMLIC Sales Corporation, distributor of the Funds.
Contact your representative for information and a prospectus for any of the
Advantus Funds you are interested in.
MINIMUM INVESTMENTS: Your initial investment in any of the Advantus Funds can
be as small as $25 when you use our Systematic Investment Plan. Minimum lump-sum
initial investment is $250. Minimum subsequent investment is $25.
THE FUND'S MANAGER
Advantus Capital Management, Inc., investment adviser to the Fund, selects
and reviews the Fund's investments and provides executive and other personnel
for the Fund's management.
Advantus Capital Management, Inc.'s six portfolio managers manage eight
mutual funds containing $215 million in assets in addition to $1.8 billion in
assets for other clients. Advantus Capital's seasoned portfolio managers average
more than 10 years of investment experience.
ADVANTUS FAMILY OF FUNDS
Advantus Bond Fund
Advantus Horizon Fund
Advantus Spectrum Fund
Advantus Enterprise Fund
Advantus Cornerstone Fund
Advantus Money Market Fund
Advantus Mortgage Securities Fund
Advantus International Balanced Fund
19
<PAGE>
THIS REPORT HAS BEEN PREPARED FOR SHAREHOLDERS AND MAY BE DISTRIBUTED
TO OTHERS ONLY IF PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS.
[LOGO]
MIMLIC SALES CORPORATION
400 ROBERT STREET NORTH
ST. PAUL, MN 55101-2098
1-800-443-3677
<PAGE>
MIMLIC SALES CORPORATION BULK RATE
400 ROBERT STREET NORTH U.S. POSTAGE PAID
ST. PAUL, MN 55101-2098 ST. PAUL, MN
PERMIT NO. 3547
FORWARDING AND RETURN POSTAGE GUARANTEED,
ADDRESS CORRECTION REQUESTED
F.48636 5-95
