<PAGE>
MONEY MARKET
ADVANTUS MONEY MARKET FUND, INC.
SEMI-ANNUAL REPORT TO SHAREHOLDERS DATED MARCH 31, 2000
[ADVANTUS LOGO]
MONEY MARKET
[COVER ART]
<PAGE>
ADVANTUS MONEY MARKET FUND
TABLE OF CONTENTS
PERFORMANCE UPDATE 2
INVESTMENTS IN SECURITIES 5
STATEMENT OF ASSETS AND LIABILITIES 7
STATEMENT OF OPERATIONS 8
STATEMENTS OF CHANGES IN NET ASSETS 9
NOTES TO FINANCIAL STATEMENTS 10
SHAREHOLDER SERVICES 13
<PAGE>
LETTER FROM THE PRESIDENT [PHOTO]
Dear Shareholder:
Americans are enjoying the longest period of economic expansion in U.S. history.
This period of growth, which began in March of 1992, recorded its eighth year of
uninterrupted growth in March. To date, the Federal Reserve's actions to slow
the nation's growth engine have not dramatically impacted the upward trend.
Despite the run-up in interest rates over the past year, housing starts and auto
sales, indicators of a robust economy, remain strong.
Around the globe we are seeing economic growth accelerate, albeit at a modest
pace. Asia is rapidly recovering from the economic debacle of the late 90s. The
Bank of Japan has kept interest rates near zero to further assist that country's
recovery. In Europe, the Central Bank raised rates to support a weak euro and
guard against inflation. Latin American economies, such as Brazil, are showing
signs of increasing strength (e.g., lower inflation, job creation). No country
comes close to the sustained economic vigor of the U.S., but many of the world's
economies are growing.
Volatility in the stock market was frequent and dramatic throughout the
six-months, with the wildest of the ride coming in early April, shortly after
this reporting period ended. The first calendar quarter of the new millennium
was a time of contrasts. For the first two months, the broad market was slightly
down, with the growth sector of technology rising and the value sectors of the
market falling. March was a reversal, with a strong rally in traditional value
stocks and a pullback in the technology arena, adding to the market tumult.
Technology, however, continues to drive the increased spending in businesses. As
tech spending increases, so does productivity.
Interest rates also showed a mixed picture. The Federal Reserve raised the Fed
Funds rate five times between June 1999 and March 2000. Each time only
.25 percent, a cumulative increase of 1.25 percent over this 10-month period.
However, longer maturity Treasury bond prices rose and their yields declined as
the U.S. Treasury used some of the budget surplus to begin buying back Treasury
bonds. Meanwhile, corporate bond yields increased.
In the pages that follow, your Fund's portfolio manager will give you his
insight on the Fund's performance for this reporting period. Also, we are
pleased to announce that you can now access your Advantus Funds data online
through the Advantus web site: www.advantusfunds.com. To learn how you can
access your Advantus Fund information through our internet site, call Advantus
Shareholder Services at 1-800-665-6005.
We value your business and want to make doing business with us as easy for you
as possible. Thank you for investing with Advantus.
Sincerely,
/s/ William N. Westhoff
William N. Westhoff, President
Advantus Funds
<PAGE>
ADVANTUS MONEY MARKET FUND
PERFORMANCE UPDATE
[PHOTO]
STEVEN S. NELSON, CFA
PORTFOLIO MANAGER
The Advantus Money Market
Fund is a mutual fund
designed for investors
seeking a high level of
current income consistent
with preservation of capital
and maintenance of liquidity.
The Fund seeks to achieve its
objective by concentrating
investments in short-term
money market instruments
including U.S. Treasury
Bills, high grade commercial
paper and bank certificates
of deposit.
- Seeks to maintain stable net asset value.
- Free checkwriting and telephone redemption.
- Dividends declared daily and paid monthly.
INVESTMENT IN THE ADVANTUS MONEY MARKET FUND IS NEITHER INSURED NOR GUARANTEED
BY THE U.S. GOVERNMENT OR ANY OTHER FEDERAL AGENCY, AND THERE CAN BE NO
ASSURANCE THAT THE FUND WILL BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF
$1.00 PER SHARE.
PERFORMANCE
For the six-month period ended March 31, 2000, the Advantus Money Market Fund
earned a total return of 2.45 percent.* This compares to the three-month U.S.
Treasury Bill, which earned 2.66 percent for the same period. The seven-day
compound yield of the Fund was 5.19 percent* for the same period.
PERFORMANCE ANALYSIS
Over the past six months short-term interest rates increased sharply, long-term
interest rates declined (after rising significantly) and the yield curve
inverted. The yield on the three-month U.S. Treasury Bill increased 104 basis
points (1.4 percent) to yield 5.89 percent at March 31, 2000. At the same time,
the yield on the 30-year Treasury Bond declined 22 basis points to yield
5.84 percent at quarter end (this was significantly lower, however, from
mid-January when the yield on the 30-year Treasury Bond peaked at
6.75 percent). Ongoing strength in the U.S. economy, lingering inflation fears
and three more 25 basis point (.25 percent) increases in the Federal Funds rate
contributed to the increase in short-term rates during this reporting period.
Including the last three increases, the Fed has increased the Federal Funds rate
on five occasions over the past nine months. In spite of the Fed's moves,
long-term Treasury rates declined rapidly in February and March of 2000 (again,
after having peaked in mid-January). A strong fiscal position in the U.S.
coupled with the government's plan to repurchase longer-term Treasury Bonds, as
well as investors' perceptions that inflation will remain in check, provided the
impetus for long Treasury rates to rally.
Over the past six months the total return of the 3-month and 6-month U.S.
Treasury Bills over the quarter was 2.66 percent and 2.52 percent, respectively.
As a result of the increase in short-term interest rates, yields on money market
portfolios are at relatively attractive levels, especially considering that they
continue to provide excellent liquidity and stability.
Financial markets globally continue to experience extreme volatility from day to
day. The past six months was no exception, as investors witnessed dramatic
swings in equity values - particularly technology stocks - while corporate bond
spreads widened significantly. Despite the volatility, high-quality U.S.
corporate commercial paper continued to offer excellent safety and liquidity as
well as attractive yields. For example, yields offered by a number of large,
high-quality issuers on 90-day commercial paper were near six percent as the
period ended.
2
<PAGE>
The Advantus Money Market Fund has approximately 95 percent of its assets
invested in high quality corporate commercial paper (i.e., commercial paper that
is rated A-1 or higher by Standard and Poor's and P-1 by Moody's). The Fund's
holdings continue to be well diversified over a variety of stable industries and
do not include any holdings in the more volatile brokerage sector. Our goal
throughout this reporting period has been to maintain the average days to
maturity of the Fund in the range of 40 to 50 days. To that end, the average
days to maturity at March 31, 2000 stood at 47 days.
OUTLOOK
Despite the steady rise in short-term interest rates over the past six months,
we feel that short-term rates could still edge higher as additional Fed
tightening moves will probably be necessary to slow the economy and keep
inflation in check. Over the next quarter we expect to see one or possibly two
additional increases in the Fed Funds rate after the Fed meetings in May and
June. We anticipate that high quality commercial paper yields over this period
will likely stay near six percent and continue to offer investors a safe and
attractive return compared to other longer-term fixed income opportunities.
*Historical performance is not an indication of future performance.
3
<PAGE>
AVERAGE DAYS TO MATURITY
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NUMBER OF DAYS
<S> <C>
10/05/99 58
10/12/99 57
10/19/99 62
10/26/99 62
11/02/99 64
11/09/99 64
11/16/99 61
11/23/99 56
11/30/99 55
12/07/99 56
12/14/99 57
12/21/99 55
12/28/99 48
01/04/00 57
01/11/00 52
01/18/00 57
01/25/00 68
02/01/00 69
02/08/00 60
02/15/00 54
02/22/00 48
02/29/00 52
03/07/00 53
03/14/00 49
03/21/00 46
03/28/00 47
03/31/00 47
</TABLE>
SEVEN-DAY COMPOUND YIELD*
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PERCENTAGE
<S> <C>
10/05/99 4.49%
10/12/99 4.56%
10/19/99 4.35%
10/26/99 4.41%
11/02/99 5.00%
11/09/99 4.77%
11/16/99 4.92%
11/23/99 4.86%
11/30/99 4.97%
12/07/99 4.93%
12/14/99 5.03%
12/21/99 5.04%
12/28/99 5.05%
01/04/00 5.12%
01/11/00 5.12%
01/18/00 4.98%
01/25/00 5.12%
02/01/00 5.11%
02/08/00 5.11%
02/15/00 5.06%
02/22/00 4.76%
02/29/00 5.33%
03/07/00 5.10%
03/14/00 5.22%
03/21/00 5.23%
03/28/00 5.18%
03/31/00 5.19%
</TABLE>
The seven-day compound yield is computed by determining the net change in the
value of a hypothetical account having a balance of one share at the beginning
of a seven calendar day period, dividing that change by seven, adding one to the
quotient, raising the sum to the 365th power and subtracting one from the
result.
*Historical performance is not an indication of future performance.
4
<PAGE>
ADVANTUS MONEY MARKET FUND
INVESTMENTS IN SECURITIES
MARCH 31, 2000
(UNAUDITED)
(Percentages of each investment category relate to total net assets.)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(A)
--------- ---------------
<C> <S> <C> <C> <C>
COMMERCIAL PAPER (100.1%)
BASIC MATERIALS (12.4%)
Agriculture Products (3.9%)
$1,515,000 Archer-Daniels-Midland Company................... 6.171% 05/25/00 $ 1,501,294
-----------
Chemicals (5.3%)
1,045,000 E.I. DuPont de Nemours & Company................. 5.954% 05/26/00 1,035,708
1,030,000 E.I. DuPont de Nemours & Company................. 5.922% 06/02/00 1,019,741
-----------
2,055,449
-----------
Paper and Forest (3.2%)
1,240,000 Kimberly Clark Corporation (c).................. 6.158% 05/25/00 1,228,805
-----------
COMMUNICATION SERVICES (5.2%)
Telephone (5.2%)
2,000,000 Bellsouth Telecommunications..................... 5.923% 04/06/00 1,998,379
-----------
CONSUMER CYCLICAL (12.1%)
Hardware and Tools (3.2%)
1,250,000 The Stanley Works................................ 6.004% 04/17/00 1,246,719
-----------
Publishing (3.7%)
1,420,000 The McGraw-Hill Companies, Inc................... 6.209% 05/31/00 1,405,653
-----------
Retail (5.2%)
2,000,000 Wal-Mart Stores.................................. 5.922% 04/05/00 1,998,703
-----------
CONSUMER STAPLES (22.3%)
Beverage (4.9%)
1,900,000 Coca-Cola Enterprises, Inc....................... 5.940% 04/13/00 1,896,297
-----------
Entertainment (3.4%)
1,355,000 Walt Disney Company.............................. 6.251% 10/13/00 1,311,130
-----------
Food (14.0%)
1,520,000 Bestfood......................................... 6.256% 06/22/00 1,498,932
1,900,000 General Mills, Inc............................... 5.911% 04/04/00 1,899,077
2,000,000 H.J. Heinz Company............................... 5.921% 04/04/00 1,999,027
-----------
5,397,036
-----------
FINANCIAL (23.1%)
Auto Finance (10.4%)
$2,060,000 Ford Motor Credit................................ 5.946% 09/29/00 $ 2,000,997
2,035,000 GMAC............................................. 5.839% 05/19/00 2,019,494
-----------
4,020,491
-----------
Commercial Finance (3.6%)
1,387,000 Bell Atlantic Network Funding.................... 6.096% 04/19/00 1,382,843
-----------
</TABLE>
See accompanying notes to investments in securities.
5
<PAGE>
ADVANTUS MONEY MARKET FUND
INVESTMENTS IN SECURITIES - CONTINUED
<TABLE>
<CAPTION>
PRINCIPAL VALUE(A)
--------- ---------------
FINANCIAL--CONTINUED
<C> <S> <C> <C> <C>
Consumer Finance (9.1%)
2,000,000 Ciesco LP (c)................................... 5.974% 04/12/00 1,996,406
1,500,000 GTE Funding, Inc................................. 6.155% 04/18/00 1,495,712
-----------
3,492,118
-----------
HEALTH CARE (10.5%)
Drugs (6.5%)
1,000,000 American Home Products Corporation (c).......... 5.959% 04/10/00 998,533
1,515,000 Schering Plough Corporation...................... 5.996% 05/02/00 1,507,324
-----------
2,505,857
-----------
Medical Products/Supplies (4.0%)
1,565,000 Johnson & Johnson (c)........................... 6.065% 07/05/00 1,540,678
-----------
UTILITIES (14.5%)
Electric Companies (14.5%)
1,500,000 Alabama Power Company............................ 5.986% 04/14/00 1,496,809
1,485,000 Florida Power Corporation........................ 6.132% 04/17/00 1,481,019
1,100,000 MidAmerica Energy................................ 6.157% 04/20/00 1,096,486
1,510,000 Potomac Electric Power Company................... 6.023% 04/24/00 1,504,290
-----------
5,578,604
-----------
Total commercial paper (cost: $38,560,056).......................... 39,577,969
-----------
DEBENTURE (2.7%)
Household Products (2.7%)
1,000,000 Premark International, Inc....................... 10.500% 09/15/00 1,017,913
-----------
-----------
Total Debenture (cost: 1,017,913)................................... 1,017,913
-----------
</TABLE>
<TABLE>
<C> <S> <C> <C> <C>
MONEY MARKET FUND (.7%)
271,637 Federated Money Market Obligation Trust--Prime
Obligation Fund, current rate................... 5.800% 271,637
-----------
Total short-term securities (cost: $271,637)....................... 271,637
-----------
Total investments in securities (cost: $39,849,606) (b)............ $39,849,606
===========
</TABLE>
Notes to Investments in Securities
-----------------------------------
(a) Securities are valued by procedures described in note 1 to the financial
statements.
(b) Also represents the cost of securities for federal income tax purposes at
March 31, 2000.
(c) Commercial paper sold within terms of a private placement memorandum, exempt
from registration under Section 4(2) of the Securities Act of 1933, as
amended, and may be sold only to dealers in that program or other
"accredited investors." This security has been determined to be liquid under
guidelines established by the Board of Directors.
6
<PAGE>
ADVANTUS MONEY MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 2000
(UNAUDITED)
<TABLE>
<S> <C>
ASSETS
Investments in securities, at amortized
cost - see accompanying schedule for
detailed listing...................... $39,849,606
Cash in bank on demand deposit......... 14
Receivable for Fund shares sold........ 44,776
Accrued interest receivable............ 10,563
Other receivables...................... 2,018
----------
Total assets....................... 39,906,977
----------
LIABILITIES
Payable for investment securities
purchased............................. 364
Payable for Fund shares redeemed....... 1,370,635
Dividends payable to shareholders...... 3,923
Payable to Adviser..................... 28,526
----------
Total liabilities.................. 1,403,448
----------
Net assets applicable to outstanding
capital stock......................... $38,503,529
==========
Represented by:
Capital stock - authorized 10 billion
shares of $.01 par value; outstanding
38,503,529 shares.................... $ 385,035
Additional paid-in capital........... 38,118,494
----------
Total - representing net assets
applicable to outstanding capital
stock.............................. $38,503,529
==========
Net asset value per share.............. $ 1.00
==========
</TABLE>
See accompanying notes to financial statements.
7
<PAGE>
ADVANTUS MONEY MARKET FUND
STATEMENT OF OPERATIONS
PERIOD FROM OCTOBER 1, 1999 TO MARCH 31, 2000
(UNAUDITED)
<TABLE>
<S> <C>
Investment income:
Interest............................. $1,170,666
---------
Expenses (note 3):
Investment advisory fee.............. 102,566
Rule 12b-1........................... 54,890
Administrative services fee.......... 30,600
Transfer agent fees.................. 125,610
Custodian fees....................... 3,360
Auditing and accounting services..... 8,847
Legal fees........................... 4,000
Registration fees.................... 22,000
Printing and shareholder reports..... 44,712
Insurance............................ 1,770
Directors' fees...................... 421
Other................................ 2,018
---------
Total expenses..................... 400,794
---------
Less fees and expenses waived or
absorbed by the Adviser and
Distributor
Rule 12b-1 fees...................... (54,890)
Other fund expenses.................. (171,541)
---------
Total fees and expenses waived or
absorbed.......................... (226,431)
---------
Total net expenses................. 174,363
---------
Investment income - net............ 996,303
---------
Net increase in net assets resulting
from operations...................... $ 996,303
=========
</TABLE>
See accompanying notes to financial statements.
8
<PAGE>
ADVANTUS MONEY MARKET FUND
STATEMENTS OF CHANGES IN NET ASSETS
PERIOD FROM OCTOBER 1, 1999 TO MARCH 31, 2000 AND YEAR ENDED SEPTEMBER 30, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
2000 1999
------------ -------------
<S> <C> <C>
Operations:
Investment income - net.............. $ 996,303 $ 2,176,959
------------ -------------
Increase in net assets resulting
from operations.................. 996,303 2,176,959
------------ -------------
Distributions to shareholders from net
investment income.................... (996,303) (2,176,959)
Capital share transactions at a
constant net asset value of $1.00
Proceeds from sales.................. 62,103,993 92,025,759
Proceeds from issuance of shares as a
result of reinvested dividends..... 969,423 2,143,222
Payments for redemption of shares.... (65,772,643) (113,867,509)
------------ -------------
Decrease in net assets from capital
share transactions............... (2,699,227) (19,698,528)
------------ -------------
Total decrease in net assets....... (2,699,227) (19,698,528)
Net assets at beginning of period...... 41,202,756 60,901,284
------------ -------------
Net assets at end of period............ $ 38,503,529 $ 41,202,756
============ =============
</TABLE>
See accompanying notes to financial statements.
9
<PAGE>
ADVANTUS MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2000
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Advantus Money Market Fund, Inc. (the Fund) is registered under the
Investment Company Act of 1940 (as amended) as a diversified, open-end
management investment company. The Fund's investment objective is to seek a high
level of current income consistent with preservation of capital and maintenance
of liquidity.
The significant accounting policies of the Fund are summarized as follows:
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts in the financial statements. Actual
results could differ from those estimates.
INVESTMENTS IN SECURITIES
All securities are valued at the close of each business day. Pursuant to
Rule 2a-7 of the Investment Company Act of 1940 (as amended), all securities are
valued at amortized cost which approximates market value, in order to maintain a
constant net asset value of $1.00.
Security transactions are accounted for on the date the securities are
purchased or sold. 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.
Net investment income 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 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 daily and paid monthly in
cash or reinvested in additional shares. Capital gains, if any, are paid
annually.
(2) INVESTMENT SECURITY TRANSACTIONS
For the period ended March 31, 2000, purchases of securities and proceeds
from sales aggregated $138,529,038 and $139,918,328, respectively.
(3) EXPENSES AND RELATED PARTY TRANSACTIONS
The Fund has an investment advisory agreement with Advantus Capital
Management, Inc. (Advantus Capital or the Adviser), a wholly-owned subsidiary of
Minnesota Life Insurance Company (Minnesota Life). Under the agreement, Advantus
Capital manages the Fund's assets and provides research, statistical and
advisory services
10
<PAGE>
ADVANTUS MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS - CONTINUED
(3) EXPENSES AND RELATED PARTY TRANSACTIONS - (CONTINUED)
and pays related office rental and executive expenses and salaries. The fee for
investment management and advisory services is based on the average daily net
assets of the Fund at the annual rate of .50 percent. The Fund has engaged PFPC
Global Fund Services, Inc. (formerly First Data Investor Services Group) to act
as its transfer agent, dividend disbursing agent and redemption agent and bears
the expenses of such services.
The Fund has adopted a Plan of Distribution relating to the payment of
certain expenses pursuant to Rule 12b-1 under the Investment Company Act of 1940
(as amended). The Plan provides for a service fee up to .25 percent of average
daily net assets to be paid to Ascend Financial Services, Inc. (Ascend), the
underwriter of the Fund and wholly-owned subsidiary of Advantus Capital, to be
used to pay certain expenses incurred in the distribution, promotion and
servicing of the Fund's shares. Prior to February 1, 1999, the Plan provided for
a distribution fee up to .30 percent of average daily net assets. Ascend is
currently waiving all of the Rule 12b-1 fees from the Fund in the amount of
$54,890 for the period ended March 31, 2000.
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, organizational costs and other
miscellaneous expenses.
The Fund has entered into a shareholder and administrative services
agreement with Minnesota Life. Under this agreement, the Fund pays a shareholder
services fee, equal to $5 per shareholder account annually, to Minnesota Life
for shareholder services which Minnesota Life provides. The Fund also pays
Minnesota Life an administrative services fee equal to $5,100 per month for
accounting, auditing, legal and other administrative services which Minnesota
Life provides. Prior to February 1, 1999, the administrative services fee was
$3,100 per month.
Advantus Capital directly incurs and pays the Fund's operating expenses and
the Fund in turn reimburses Advantus Capital. During the period ended March 31,
2000, Advantus Capital voluntarily agreed to absorb $171,541 in expenses which
were otherwise payable by the Fund.
As of March 31, 2000, Minnesota Life and subsidiaries and the directors and
officers of the Fund as a whole owned 3,047,523 shares or 7.9 percent of the
Fund's total shares outstanding.
Legal fees were paid to a law firm of which the Fund's secretary is a
partner in the amount of $2,625.
11
<PAGE>
ADVANTUS MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS - CONTINUED
(4) FINANCIAL HIGHLIGHTS
Per share data for a share of capital stock and selected information for
each period are as follows:
<TABLE>
<CAPTION>
PERIOD FROM
OCTOBER 1,
1999 TO
MARCH 31, YEAR ENDED SEPTEMBER 30,
2000 ---------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995(A)
----------- ------- ------- ------- ------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value beginning of
period...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- -------
Income from investment
operations:
Net investment income....... .02 .04 .05 .05 .05 .05
------- ------- ------- ------- ------- -------
Total from investment
operations.............. .02 .04 .05 .05 .05 .05
------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net
investment income......... (.02) (.04) (.05) (.05) (.05) (.05)
------- ------- ------- ------- ------- -------
Total distributions....... (.02) (.04) (.05) (.05) (.05) (.05)
------- ------- ------- ------- ------- -------
Net asset value, end of
period...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= ======= =======
Total return (b).............. 2.45% 4.24% 4.78% 4.69% 4.74% 5.02%
Net assets, end of period (in
thousands).................. $38,504 $41,203 $60,901 $54,491 $43,953 $36,107
Ratio of expenses to average
daily net assets (c)........ .85%(d) .85% .85% .85% .85% .85%
Ratio of net investment income
to average daily net
assets (c).................. 4.86%(d) 4.17% 4.68% 4.61% 4.64% 4.93%
</TABLE>
------------
(a) Effective March 1, 1995, the Fund entered into a new investment advisory
agreement with Advantus Capital Management, Inc. Prior to March 1, 1995,
the Fund had an investment advisory agreement with MIMLIC Asset Management
Company.
(b) Total return figures are based on a share outstanding throughout the period
and assume reinvestment of distributions at net asset value.
(c) The Fund's Distributor and Adviser voluntarily waived or absorbed $226,431,
$371,434, $323,639, $288,928, $261,733 and $240,231 in expenses for the
period ended March 31, 2000, and the years ended September 30, 1999, 1998,
1997, 1996 and 1995. If the Fund had been charged for these expenses, the
ratio of expenses to average daily net assets would have been 1.95%, 1.56%,
1.41%, 1.43%, 1.51% and 1.66%, respectively, and the ratio of net
investment income to average daily net assets would have been 3.75%, 3.46%,
4.12%, 4.03%, 3.98% and 4.12%, respectively.
(d) Adjusted to an annual basis.
12
<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 may apply.
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 share class) at any time as your needs change. Exchanges are at the
then current net asset value (exchanges from the Advantus Money Market Fund will
incur the applicable sales charge, if not previously subjected to the charge).
Shareholders may make twelve exchanges each calendar year without incurring a
transaction charge. Thereafter, there will be a $7.50 transaction charge for
each additional exchange within the calendar year.
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 a check at
specified intervals from your fund account - subject to minimum guidelines.
Depending upon the performance of the underlying investment options, the value
may be worth more or less than the original amount invested when withdrawn.
DIRECT DIVIDEND 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 EXCHANGE: You may move money from one Advantus account to any other
Advantus account you own (with identical registrations within the same share
class) just by calling our toll-free number. The Telephone Exchange privilege
will automatically be established unless otherwise indicated on the Account
Application. Telephone Exchange may be changed (added/deleted) at any time by
submitting a request in writing.
SYSTEMATIC EXCHANGE: You may move a set amount of money monthly or quarterly
from one Advantus Fund to another Advantus Fund (with identical registrations
within the same share class) to diversify your investment portfolio and take
advantage of "dollar-cost averaging".
AUTOMATIC PAYMENT OF INSURANCE PREMIUMS: You may automatically pay your
Minnesota Life insurance premiums from your 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, if any.
AUTOMATIC INVESTMENT PLAN: This special purchase plan enables 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.) The Automatic Investment
Plan allows you to invest automatically monthly, semi-monthly or quarterly from
your checking or savings account.
IRAS, OTHER QUALIFIED PLANS: You can use the Advantus Family of Funds for your
Traditional, Roth or Education Individual Retirement Account or other qualified
plans including: SEP IRA's, SIMPLE IRA's, Profit Sharing, 401(k) Money Purchase
or Defined Benefit plans.
TELEPHONE REDEMPTION: You may call us and redeem shares over the phone. The
proceeds will be sent by check to the address of record for the account or wire
transferred to your bank of record for the account. Wire transfers are for
amounts over $500. The prevailing wire charge will be added to the withdrawal
amount. The Telephone Redemption privilege will automatically be established
unless otherwise indicated on the Account Application. Telephone Redemption may
be changed (added/deleted) at any time by submitting a request in writing. To
have the redemption automatically deposited into your checking account, please
send a voided check
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from your bank. Depending on the performance of the underlying investment
options, the value may be worth more or less than the original amount invested
upon redemption. Some limitations apply, please refer to the prospectus for
details.
ACCOUNT UPDATES: You'll receive written confirmation of every investment you
initiate and quarterly statements to help you track all of your Advantus Fund
investments and annual tax statements. Semi-annual 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 Advantus Shareholder Services, call 1-800-665-6005.
Advantus Account Representatives are available Monday through Friday from 7:30
a.m. to 5:15 p.m. Central Time. Our voice response system is available 24 hours,
seven days a week. This system allows you to access current net asset values,
account balances and recent account activity.
INTERNET ADDRESS: www.AdvantusFunds.com
HOW TO INVEST
You can invest in one or more of the eleven Advantus Funds through a local
Registered Representative of Ascend Financial Services, Inc., distributor of the
Funds. Contact your representative for information and a prospectus for any of
the Advantus Funds you are interested in. To find a Registered Representative
near you, call the toll-free service line (1-800-665-6005) or visit
www.AdvantusFunds.com.
MINIMUM INVESTMENTS: Your initial investment in any of the Advantus Funds can
be as small as $25 when you use our Automatic 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. (For the Advantus International Balanced Fund, Inc., the
sub-adviser, Templeton Investment Counsel, Inc., selects the Fund's
investments.)
Advantus Capital Management, Inc. manages twelve mutual funds containing $3.7
billion in assets in addition to $10.9 billion in assets for other clients.
Advantus Capital's seasoned portfolio managers average more than 14 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
Advantus Venture Fund
Advantus Index 500 Fund
Advantus Real Estate Securities Fund
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THIS REPORT HAS BEEN PREPARED FOR SHAREHOLDERS. THIS MAY BE USED AS SALES
LITERATURE IN
CONNECTION WITH THE OFFER OR SALE OF THE ADVANTUS MONEY MARKET FUND
IF PRECEDED OR ACCOMPANIED BY (A) THE CURRENT PROSPECTUS FOR THE
ADVANTUS MONEY MARKET FUND, AND (B) THE CURRENT
ADVANTUS MUTUAL FUND PERFORMANCE REPORT.
READ THE PROSPECTUS CAREFULLY BEFORE YOU INVEST.
[ADVANTUS -TM- FAMILY OF FUNDS]
ASCEND FINANCIAL SERVICES, INC.,
SECURITIES DEALER, MEMBER NASD/SIPC
400 ROBERT STREET NORTH
ST. PAUL, MN 55101-2098
1-800-AFS-1838
(1-800-237-1838)
<PAGE>
<TABLE>
<S> <C>
ASCEND FINANCIAL SERVICES, INC. PRESORTED STANDARD
400 ROBERT STREET NORTH U.S. POSTAGE PAID
ST. PAUL, MN 55101-2098 ST. PAUL, MN
PERMIT NO. 3547
ADDRESS SERVICE REQUESTED
</TABLE>
F.48642 Rev. 5-2000
