<PAGE>
[LOGO]
ADVANTUS
FAMILY OF FUNDS
SEMI-ANNUAL REPORT TO SHAREHOLDERS
ADVANTUS SPECTRUM FUND
March 31, 1996
<PAGE>
ADVANTUS SPECTRUM FUND
TABLE OF CONTENTS
PERFORMANCE UPDATE 2
INVESTMENTS IN SECURITIES 7
STATEMENT OF ASSETS AND
LIABILITIES 12
STATEMENT OF OPERATIONS 13
STATEMENT OF CHANGES IN NET
ASSETS 14
NOTES TO FINANCIAL STATEMENTS 15
SHAREHOLDER SERVICES 21
<PAGE>
May 15, 1996
[PHOTO]
Dear Shareholders:
The stock market continued making impressive gains in the first quarter of
1996--up 5.4 percent, as measured by the S&P 500, after finishing 1995 at record
levels. The bond market, however, retreated from year-end highs, yielding a
negative 2.6 percent return according to the Lehman Corporate Bond Index.
Concerns about strong economic growth and full employment were the primary
factors in the bond market's slump, while strong corporate earnings and profits
led the stock market's charge. Retail stocks helped pace the market's first
quarter performance while technology companies returned widely fluctuating
results.
In the near-term, we believe that many large company earnings expectations will
be revised downward. This downward pressure should benefit higher quality
securities. Many small cap companies continue to demonstrate strong earnings
growth and their relative valuations maintain significant upside potential.
While growth in the U.S. market may slow, we maintain confidence that the equity
market holds opportunity for investors.
Improving economic growth and increased inflation have bond investors concerned
about the course of future interest rates. Higher commodity prices and strong
employment caused rates to jump in recent months. Rising interest rates offer
investors the chance to buy fixed income investments at attractive levels but
will keep the bond market in check until rates stabilize.
Diversification across industries and geographic regions remains a key element
of our success. However, determining which investments will perform well in both
the near and long-term requires professional experience. Advantus Capital
Management, Inc. offers a family of eight funds designed to help you reach your
financial goals with a thoughtful, well conceived investment strategy.
Sincerely,
[SIGNATURE]
Paul Gooding, President
Advantus Capital Management, Inc.
<PAGE>
ADVANTUS SPECTRUM FUND
PERFORMANCE UPDATE
[PHOTO]
THOMAS A. GUNDERSON, CFA
PORTFOLIO MANAGER
The Advantus Spectrum Fund is a mutual
fund seeking the most favorable total
return (including interest, dividends and
capital appreciation) consistent with
preservation of capital. To achieve this
objective, the Fund will vary the
composition of its portfolio with
prevailing economic conditions. At any
given time, the Fund's portfolio may be
primarily composed of equity securities
(common stock, preferred stock and
securities convertible into equity
securities), mortgage-related securities,
debt securities, money market securities
or any combination of these securities.
The investment adviser's positioning of
the portfolio is determined by the
intermediate term outlook for economic
trends and market momentum.
-Dividends paid quarterly.
-Capital gains distributions paid annually.
PERFORMANCE
The Advantus Spectrum Fund's performance for the period from October 1, 1995 to
March 31, 1996 for each class of shares offered was as follows:
<TABLE>
<S> <C>
Class A 6.5 percent*
Class B 6.2 percent*
Class C 6.1 percent*
</TABLE>
Over the past six months the bond market, measured by the Lehman
Government/Corporate Bond Index+ gained 2.2 percent, the S&P 500++ was up 11.7
percent, while money market instruments were up about 3 percent. The theoretical
return for the Merrill Lynch/Wilshire Capital Markets Index** was 7.2 percent
for the six month period. The primary difference in returns between the Advantus
Spectrum Fund and the Capital Markets Index** was due to the nearly 10 percent
average holding of cash for the Advantus Spectrum Fund over the past six months,
while the Capital Markets Index** by definition has no cash.
PORTFOLIO RECAP
The 1995 stock market recorded its best year in 37 years and, measured by the
S&P 500, it gained another 5.4 percent during the first quarter of 1996. The
market gain was fueled primarily by record cash flows into U.S. stock mutual
funds. The primary drivers of stock performance during the past few years,
significant earnings growth and lower interest rates, were noticeably absent.
Earnings growth rates for the market are clearly slowing, and interest rates
have been climbing all year.
Over the past six months stocks ranged from 55 percent to 60 percent of the
portfolio. The stock performance slightly lagged the market primarily due to
some of the technology stocks such as Informix and Bay Networks. Meanwhile, some
of the best performing stocks were also in the technology area, names like
Computer Associates and Parametric Technology. The broadly defined technology
sector is now about 24 percent of the portfolio, and did not change meaningfully
during the period.
The bond market lost money during the first quarter of 1996 as interest rates
reversed course from the downward progression in 1995. The rate on the 10 year
U.S. Treasury went from 5.57 percent at year end to 6.32 percent, a large 75
basis point increase in three months. The bonds in the portfolio had a slightly
longer duration than the market and were negatively impacted by the rise in
rates.
2
<PAGE>
ADVANTUS SPECTRUM FUND
MARCH 31, 1996
OUTLOOK
The long term outlook for the financial markets is good. Financial assets are
attractive when inflation is low, the economy is moderately growing, and
corporate earnings are moving higher. All three of these conditions exist today.
From a relative valuation perspective, the recent increase in bond yields have
made bonds more attractive. The ten year bond yield is nearly 4 percent above
the current inflation rate and provides an attractive investment opportunity. As
a result, we have recently increased our bond holdings by 5 percent to 35
percent of the portfolio. We are looking for an opportunity to put additional
money into bonds.
The long term fundamentals for stocks are strong, but the market may face some
challenges in the near term. The rate of earnings growth is slowing.
Additionally, our work indicates the market to be fully valued, but not over
valued. We cut stocks to 55 percent of the portfolio in March. If we see an end
to the current slowdown in earnings growth, if interest rates stabilize, or if
stocks experience a downward correction we will be inclined to increase our
stock allocation.
Currently the asset mix is 55 percent stocks, 35 percent bonds, and 10 percent
cash.
After record low levels of volatility in the financial markets over the past few
years we would not be surprised to see higher volatility in the financial
markets. We view this possibility as an opportunity for the Spectrum Fund to
identify and exploit attractive investments. As always, we seek to manage the
portfolio to have the most beneficial balance between return and risk.
*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.
**The Merrill Lynch-Wilshire Capital Markets Index is a market value-weighted
index measuring the total return performance of the combined domestic taxable
fixed income and equity markets. It includes the entire domestic common stock
universe for which daily pricing is available, as well as all publicly placed
domestic taxable debt issues with at least one year remaining to maturity and at
least ten million dollars par value outstanding.
+The Lehman Brothers Government Corporate Bond Index is an unmanaged benchmark
composite of the Lehman Brothers Government Bond Index which includes all
publicly issued debt of the U.S. Government and Agencies and the Lehman Brothers
Corporate Bond Index which includes all publicly issued fixed rate,
non-convertible domestic corporate debt.
++The S&P 500 is a broad, unmanaged index of 500 common stocks which are
representative of the U.S. stock market overall.
3
<PAGE>
ADVANTUS SPECTRUM FUND
MARCH 31, 1996
COMPARISON OF CHANGE IN VALUE OF A HYPOTHETICAL
$10,000 INVESTMENT IN ADVANTUS SPECTRUM FUND, MERRILL LYNCH-WILSHIRE CAPITAL
MARKETS INDEX AND CONSUMER PRICE INDEX
On the following three charts you can see how the total return for each of the
three classes of shares of the Advantus Spectrum Fund compared to the Merrill
Lynch-Wilshire Capital Markets Index and the Consumer Price Index. The three
lines in each graph represent the cumulative total return of a hypothetical
$10,000 investment made on the inception date of each class of shares of the
Advantus Spectrum Fund (November 16, 1987, August 19, 1994 and March 1, 1995 for
Class A, B, and C, respectively) through March 31, 1996.
CLASS A
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL
RETURN:
<S> <C> <C> <C>
One year 12.9%
Five year 8.8%
Since inception (11/16/87) 10.4%
ML-Wilshire Capital
Class A Markets Index CPI
11/16/87 9,501 10,000 10,000
10/31/88 10,505 10,762 10,426
10/31/89 12,273 12,740 10,904
10/31/90 12,208 12,341 11,590
10/31/91 15,382 15,647 11,929
10/31/92 17,086 17,215 12,311
10/31/93 18,569 19,809 12,641
09/30/94 18,213 19,578 13,023
09/30/95 21,561 23,927 13,310
03/31/96 22,960 25,652 13,519
</TABLE>
CLASS B
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL
RETURN:
<S> <C> <C> <C>
One year 13.1%
Since inception (8/19/94) 12.2%
ML-Wilshire Capital
Class B Markets Index CPI
8/19/94 10,000 10,000 10,000
9/30/94 10,003 9,952 10,067
9/30/95 11,316 12,162 10,289
3/31/96 12,040 13,039 10,450
</TABLE>
4
<PAGE>
ADVANTUS SPECTRUM FUND
MARCH 31, 1996
CLASS C
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL
RETURN:
<S> <C> <C> <C>
One year 18.1%
Since inception (3/1/95) 17.9%
ML-Wilshire Capital Markets
Class C Index CPI
3/01/95 10,000 10,000 10,000
9/30/95 11,263 11,626 10,146
3/31/96 11,954 12,465 10,305
</TABLE>
The preceding 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 applicable
contingent deferred sales charge for Class B shares. Sales charges pay for your
financial adviser's investment advice. Individuals cannot buy even an unmanaged
index fund without incurring some charges and expenses.
Historical results are not an indication of future performance. Investment
returns and principal values will fluctuate so that shares upon redemption may
be worth more or less than their original cost.
5
<PAGE>
ADVANTUS SPECTRUM FUND
MARCH 31, 1996
FIVE LARGEST STOCK HOLDINGS
<TABLE>
<CAPTION>
% OF
MARKET STOCK
COMPANY SHARES VALUE PORTFOLIO
- -------------------------------------------------- ------ ---------- ----------
<S> <C> <C> <C>
Computer Associates International................. 16,759 $1,200,363 3.5%
General Electric Company.......................... 14,226 1,107,850 3.2%
First Data Corp................................... 14,172 999,126 2.9%
Pfizer Inc........................................ 14,020 939,340 2.8%
Federal Home Loan Mortgage Corporation............ 10,850 924,963 2.7%
---------- ---
$5,171,642 15.1%
---------- ---
---------- ---
</TABLE>
BOND PORTFOLIO CHARACTERISTICS--QUALITY BREAKDOWN
<TABLE>
<CAPTION>
% OF
BOND
RATING PORTFOLIO
- ------------------------------------------------------------ --------
<S> <C>
U.S. Treasury............................................... 32.6%
U.S. Government Agencies.................................... 17.9%
AA rated.................................................... 7.9%
A rated..................................................... 22.4%
BBB rated................................................... 19.2%
--------
100.0%
--------
--------
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Common Stocks 56.2%
Bonds 35.1%
Cash and Other
Assets/Liabilities 8.7%
100.0%
</TABLE>
6
<PAGE>
ADVANTUS SPECTRUM FUND
INVESTMENTS IN SECURITIES
MARCH 31, 1996
(UNAUDITED)
(Percentages of each investment category relate to total net assets.)
<TABLE>
<CAPTION>
MARKET
SHARES VALUE(A)
- ------------ -------------
<C> <S> <C>
COMMON STOCKS (56.2%)
CAPITAL GOODS (5.4%)
Machinery (5.4%)
14,226 General Electric Company............................... $ 1,107,850
7,000 ITT Hartford Group..................................... 343,000
13,800 Millipore Corporation.................................. 527,850
10,105 United Waste Systems, Inc (b).......................... 505,250
16,719 York International Corp................................ 819,231
-------------
3,303,181
-------------
CONSUMER GOODS AND SERVICES (21.8%)
Consumer Goods (12.1%)
15,560 Columbia/HCA Healthcare Corporation.................... 898,590
6,400 Gillette Company....................................... 331,200
8,800 Johnson & Johnson...................................... 811,800
13,304 Pepsico, Inc........................................... 841,478
14,020 Pfizer Inc............................................. 939,340
9,600 Philip Morris Companies, Inc........................... 842,400
9,295 Procter & Gamble Company............................... 787,751
18,300 Service Corporation International...................... 892,125
6,700 Smithkline Beecham (c)................................. 345,050
6,800 Teva Pharmaceutical Industries (c)..................... 261,800
6,600 United Health Care..................................... 405,900
-------------
7,357,434
-------------
Consumer Services (2.7%)
22,333 CUC International,
Inc (b)............................................... 653,240
<CAPTION>
MARKET
SHARES VALUE(A)
- ------------ -------------
<C> <S> <C>
CONSUMER GOODS AND SERVICES--CONTINUED
4,000 Gartner (b)............................................ $ 244,000
12,769 GTECH Holdings Corporation (b)......................... 395,839
10,119 Manpower............................................... 313,689
-------------
1,606,768
-------------
Food (.6%)
5,000 CPC International...................................... 346,875
-------------
Retail (1.0%)
12,720 Home Depot, Inc........................................ 608,970
-------------
Consumer Cyclicals (5.4%)
15,200 Autozone Inc (b)....................................... 514,900
9,900 Magna International
Inc................................................... 456,637
20,900 Newell Company......................................... 559,075
17,105 Omnicom Group.......................................... 769,725
10,700 Owens Corning (b)...................................... 429,337
12,300 Tommy Hilfiger Corporation (b)......................... 564,262
-------------
3,293,936
-------------
CREDIT SENSITIVE (8.6%)
Finance (8.6%)
13,000 American Express Company............................... 641,875
7,067 American International Group, Inc...................... 661,648
10,850 Federal Home Loan Mortgage Corporation................. 924,963
14,172 First Data Corp........................................ 999,126
11,700 MGIC Investment Corporation............................ 637,650
18,900 Norwest Corporation.................................... 694,575
</TABLE>
See accompanying notes to investments in securities.
7
<PAGE>
ADVANTUS SPECTRUM FUND
INVESTMENTS IN SECURITIES--CONTINUED
<TABLE>
<CAPTION>
MARKET
SHARES VALUE(A)
- ------------ -------------
<C> <S> <C>
CREDIT SENSITIVE--CONTINUED
12,500 T. Rowe Price
Associates............................................ $ 662,500
-------------
5,222,337
-------------
INTERMEDIATE GOODS AND SERVICES (6.8%)
Energy (3.0%)
5,050 Amoco Corporation...................................... 364,862
19,916 Columbia Gas System, Inc............................... 913,647
5,030 Mobil Corporation...................................... 582,851
-------------
1,861,360
-------------
Materials (1.5%)
6,800 Kimberly-Clark Corporation............................. 506,600
9,700 Praxair Inc............................................ 386,788
-------------
893,388
-------------
Transportation (2.3%)
6,700 Burlington Northern Santa Fe........................... 550,238
12,600 Fritz Companies (b).................................... 491,400
14,900 Landstar System, Inc (b)............................... 372,500
-------------
1,414,138
-------------
TECHNOLOGY (13.6%)
5,800 Adtran Incorporated (b)................................ 265,350
<CAPTION>
MARKET
SHARES VALUE(A)
- ------------ -------------
<C> <S> <C>
TECHNOLOGY--CONTINUED
18,300 Automatic Data Processing Inc.......................... $ 720,563
15,050 Bay Networks Inc (b)................................... 462,787
7,800 Cisco Systems, Inc (b)................................. 361,725
16,759 Computer Associates International...................... 1,200,363
10,300 Computer Sciences Corporation (b)...................... 724,863
21,000 Danka Business Systems, PLC (c)........................ 887,250
23,000 Equifax Incorporated................................... 462,875
4,900 Fore Systems Inc (b)................................... 350,350
4,300 Hewlett-Packard Company................................ 404,200
23,540 Informix Corporation
(b)................................................... 620,867
18,965 Oracle Corporation (b)................................. 893,726
14,800 Parametric Technology Corporation (b).................. 579,050
8,000 3 Com (b).............................................. 319,000
-------------
8,252,969
-------------
Total common stocks (cost: $28,649,615)................ 34,161,356
-------------
</TABLE>
See accompanying notes to investments in securities.
8
<PAGE>
ADVANTUS SPECTRUM FUND
INVESTMENTS IN SECURITIES--CONTINUED
<TABLE>
<CAPTION>
MARKET
PRINCIPAL VALUE(A)
- ------------ ------------
<C> <S> <C> <C> <C>
LONG-TERM DEBT SECURITIES (35.2%)
GOVERNMENT OBLIGATIONS (19.5%)
U.S. GOVERNMENT AND AGENCIES OBLIGATIONS (17.8%)
U.S. Treasury (11.5%)
$ 1,350,000 U.S. Treasury Bond............................................. 6.000% 02/15/26 $ 1,231,875
700,000 U.S. Treasury Bond............................................. 8.000% 11/15/21 793,625
1,000,000 U.S. Treasury Strips (d)............................... 5.660%-5.710% 02/15/04 607,099
2,600,000 U.S. Treasury Strips (d)............................... 5.180%-5.580% 08/15/99 2,129,189
2,200,000 U.S. Treasury Note............................................. 5.625% 10/31/97 2,200,684
------------
6,962,472
------------
Government National Mortgage Association (2.6%)
440,461 ............................................................... 7.500% 10/15/23 439,822
478,781 ............................................................... 6.500% 11/15/23 455,990
217,559 ............................................................... 7.500% 02/15/24 217,232
487,916 ............................................................... 7.000% 10/15/25 474,708
------------
1,587,752
------------
Other U.S. Government Agencies (3.7%)
500,000 Federal Farm Credit Bank....................................... 6.960% 06/06/00 497,644
250,000 Federal Home Loan Mortgage..................................... 6.550% 04/19/99 253,250
500,000 Federal Home Loan Mortgage..................................... 7.030% 04/05/04 495,334
246,532 Federal National Mortgage Association.......................... 6.500% 09/01/25 234,042
778,615 Federal National Mortgage Association.......................... 7.000% 02/01/26 758,658
------------
2,238,928
------------
OTHER GOVERNMENT OBLIGATIONS (.5%)
300,000 Quebec Province of Canada (c).................................. 9.375% 04/01/99 324,432
------------
STATE AND LOCAL GOVERNMENT OBLIGATIONS (1.2%)
764,000 Wyoming Community Development Authority........................ 6.850% 06/01/10 748,720
------------
Total government obligations (cost: $12,123,450).................................. 11,862,304
------------
</TABLE>
See accompanying notes to investments in securities.
9
<PAGE>
ADVANTUS SPECTRUM FUND
INVESTMENTS IN SECURITIES--CONTINUED
<TABLE>
<CAPTION>
MARKET
PRINCIPAL VALUE(A)
- ------------ ------------
<C> <S> <C> <C> <C>
CORPORATE OBLIGATIONS (15.7%)
CAPITAL GOODS (1.1%)
Machinery (.5%)
$ 250,000 Joy Technologies Incorporated..................................10.250% 09/01/03 $ 278,883
------------
Telecommunications (.6%)
400,000 Telekom Malaysia (c) (f)....................................... 7.125% 08/01/05 403,056
------------
BASIC INDUSTRIES (.8%)
Paper and Forest Products (.8%)
500,000 Jefferson Smurfit Group PLC (c)................................ 6.750% 11/20/05 485,178
------------
CONSUMER STAPLES (6.9%)
Drugs (1.4%)
850,000 American Home Products Corporation............................. 6.500% 10/15/02 841,792
------------
Entertainment (.9%)
500,000 Royal Caribbean Cruises........................................ 8.250% 04/01/05 519,803
------------
Food (.4%)
257,143 General Mills Inc.............................................. 6.235% 03/15/97 258,930
------------
Household Products (.7%)
400,000 Premark International Inc......................................10.500% 09/15/00 455,058
------------
Media (3.5%)
500,000 Fisher Scientific International................................ 7.125% 12/15/05 480,615
250,000 News America Holdings Inc...................................... 7.750% 12/01/45 228,516
600,000 TCI Communications Inc......................................... 8.650% 09/15/04 642,960
350,000 Time Warner Entertainment...................................... 9.625% 05/01/02 392,163
350,000 Time Warner Incorporated....................................... 7.950% 02/01/00 362,676
------------
2,106,930
------------
ENERGY (.9%)
Natural Gas Distribution (.9%)
500,000 Consolidated Natural Gas Company............................... 8.750% 06/01/99 535,875
------------
FINANCIAL (5.3%)
Consumer Finance (3.3%)
400,000 Chrysler Financial Corporation................................. 6.180% 12/15/00 392,840
400,000 Commercial Credit Company...................................... 5.550% 02/15/01 383,974
250,000 Ford Motor Credit (e).......................................... 5.060% 03/18/99 248,875
</TABLE>
See accompanying notes to investments in securities.
10
<PAGE>
ADVANTUS SPECTRUM FUND
INVESTMENTS IN SECURITIES--CONTINUED
<TABLE>
<CAPTION>
MARKET
PRINCIPAL VALUE(A)
- ------------ ------------
<C> <S> <C> <C> <C>
CORPORATE OBLIGATIONS--CONTINUED
$ 600,000 Ford Motor Credit.............................................. 6.250% 12/08/05 $ 566,250
400,000 Lehman Brothers Holdings....................................... 7.375% 05/15/07 410,685
------------
2,002,624
------------
Real Estate (2.0%)
500,000 Franchise Finance Corporation of America....................... 7.020% 02/20/03 475,655
250,000 Security Capital Industrial Trust.............................. 7.875% 05/15/09 252,226
500,000 Security Capital Pacific Trust................................. 7.500% 02/15/14 471,277
------------
1,199,158
------------
UTILITIES (.7%)
Electric (.7%)
400,000 Korea Electric Power Company (c)............................... 7.750% 04/01/13 398,876
------------
Total corporate obligations (cost: $9,717,016).................................... 9,486,163
------------
Total long-term debt securities (cost: $21,840,466)............................... 21,348,467
------------
SHORT-TERM SECURITIES (7.0%)
2,975,000 U.S. Treasury Bills.................................... 4.99%-5.07% 05/16/96 2,955,008
300,000 U.S. Treasury Bill.............................................. 5.14% 06/13/96 296,808
1,000,000 PHH Corporation CP.............................................. 5.29% 04/02/96 999,422
------------
Total short-term securities (cost: $4,252,844).................................... 4,251,238
------------
Total investments in securities (cost: $54,742,925) (g)........................... $ 59,761,061
------------
------------
</TABLE>
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 5.1% of net assets in foreign securities as of March 31,
1996.
(d) For zero coupon issues (strips) the interest rate disclosed is the
effective yield at the date of acquisition.
(e) Represents a debt security with a variable rate. The interest rate
disclosed is the rate in effect at March 31, 1996.
(f) Represents ownership in a restricted security which has not been registered
with the Securities and Exchange Commission under the Securities Act of
1933. (See note 6 to the financial statements). Information concerning the
restricted security held at March 31, 1996, which includes acquisition date
and cost, is as follows:
<TABLE>
<CAPTION>
ACQUISITION
SECURITY DATE COST
- ------------------------------------------------------------------------------------------ --------------- ---------
<S> <C> <C>
Telekom Malaysia..................................................................... 01/04/96 $ 421,190
---------
---------
</TABLE>
(g) At March 31, 1996 the cost of securities for federal income tax purposes
was $54,851,796. The aggregate
unrealized appreciation and depreciation of investments in securities based
on this cost were:
<TABLE>
<S> <C> <C>
Gross unrealized appreciation..................... $5,937,176
Gross unrealized depreciation..................... (1,027,911)
----------
Net unrealized appreciation....................... $4,909,265
----------
----------
</TABLE>
11
<PAGE>
ADVANTUS SPECTRUM FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1996
(UNAUDITED)
<TABLE>
<S> <C>
ASSETS
Investments in securities, at market value--see accompanying schedule for
detailed listing (identified cost: $54,742,925)................................ $59,761,061
Cash in bank on demand deposit.................................................. 32,632
Receivable for Fund shares sold................................................. 75,843
Receivable for investment securities sold....................................... 1,015,531
Accrued interest and dividends receivable....................................... 368,146
-----------
Total assets................................................................ 61,253,213
-----------
LIABILITIES
Payable for investment securities purchased..................................... 411,430
Payable for Fund shares repurchased............................................. 36,602
Payable to Adviser.............................................................. 67,665
-----------
Total liabilities........................................................... 515,697
-----------
Net assets applicable to outstanding capital stock.............................. $60,737,516
-----------
-----------
Represented by:
Capital stock--$.01 par value (note 1)........................................ $ 41,305
Additional paid-in capital.................................................... 52,292,823
Distributions in excess of net investment income.............................. (2,573)
Accumulated net realized gains from investments............................... 3,387,825
Unrealized appreciation of investments........................................ 5,018,136
-----------
Total--representing net assets applicable to outstanding capital stock...... $60,737,516
-----------
-----------
Net assets applicable to outstanding Class A shares............................. $54,803,377
-----------
-----------
Net assets applicable to outstanding Class B shares............................. $ 5,393,547
-----------
-----------
Net assets applicable to outstanding Class C shares............................. $ 540,592
-----------
-----------
Shares outstanding and net asset value per share:
Class A--Shares outstanding 3,725,384......................................... $ 14.71
-----------
-----------
Class B--Shares outstanding 368,193........................................... $ 14.65
-----------
-----------
Class C--Shares outstanding 36,940............................................ $ 14.64
-----------
-----------
</TABLE>
See accompanying notes to financial statements.
12
<PAGE>
ADVANTUS SPECTRUM FUND
STATEMENT OF OPERATIONS
PERIOD FROM OCTOBER 1, 1995 TO MARCH 31, 1996
(UNAUDITED)
<TABLE>
<S> <C>
Investment income:
Interest...................................................................... $ 829,170
Dividends..................................................................... 186,849
----------
1,016,019
----------
Expenses (note 4):
Investment advisory fee....................................................... 179,085
Distribution fees--Class A.................................................... 96,385
Distribution fees--Class B.................................................... 21,257
Distribution fees--Class C.................................................... 1,833
Administrative services fee................................................... 19,600
Custodian fees................................................................ 8,513
Auditing and accounting services.............................................. 15,692
Legal fees.................................................................... 1,276
Directors' fees............................................................... 489
Registration fees............................................................. 17,188
Printing and shareholder reports.............................................. 20,351
Insurance..................................................................... 3,044
Other......................................................................... 16,137
----------
Total expenses.............................................................. 400,850
----------
Investment income--net...................................................... 615,169
----------
Realized and unrealized gains (losses) on investments:
Net realized gains on investments (note 3).................................... 3,760,172
Net change in unrealized appreciation or depreciation on investments.......... (690,336)
----------
Net gains on investments.................................................... 3,069,836
----------
Net increase in net assets resulting from operations............................ $3,685,005
----------
----------
</TABLE>
See accompanying notes to financial statements.
13
<PAGE>
ADVANTUS SPECTRUM FUND
STATEMENT OF CHANGES IN NET ASSETS
PERIOD FROM OCTOBER 1, 1995 TO
MARCH 31, 1996 AND YEAR ENDED SEPTEMBER 30, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
1996 1995
----------- -----------
<S> <C> <C>
Operations:
Investment income--net.............................................. $ 615,169 $ 1,806,174
Net realized gains on investments................................... 3,760,172 3,056,132
Net change in unrealized appreciation or depreciation of
investments........................................................ (690,336) 4,774,991
----------- -----------
Increase in net assets resulting from operations.................. 3,685,005 9,637,297
----------- -----------
Distributions to shareholders from:
Investment income--net:
Class A........................................................... (587,101) (1,755,964)
Class B........................................................... (37,582) (40,461)
Class C........................................................... (3,744) (1,580)
Excess of net investment income:
Class A........................................................... (2,404) --
Class B........................................................... (154) --
Class C........................................................... (15) --
Net realized gains on investments:
Class A........................................................... (3,098,381) (1,538,743)
Class B........................................................... (231,970) (10,795)
Class C........................................................... (21,070) --
----------- -----------
Total distributions............................................... (3,982,421) (3,347,543)
----------- -----------
Capital share transactions (notes 4 and 5):
Proceeds from sales:
Class A........................................................... 4,018,082 5,987,210
Class B........................................................... 2,256,460 2,799,440
Class C........................................................... 356,235 199,159
Shares issued as a result of reinvested dividends:
Class A........................................................... 3,553,243 3,022,573
Class B........................................................... 264,549 49,410
Class C........................................................... 24,257 1,482
Payments for redemption of shares:
Class A........................................................... (8,142,818) (14,784,420)
Class B........................................................... (218,038) (28,143)
Class C........................................................... (31,474) (7,348)
----------- -----------
Increase (decrease) in net assets from capital share
transactions..................................................... 2,080,496 (2,760,637)
----------- -----------
Total increase in net assets...................................... 1,783,080 3,529,117
Net assets at beginning of period..................................... 58,954,436 55,425,319
----------- -----------
Net assets at end of period [including (distributions in excess of)
undistributed net investment income of ($2,573) and $13,258,
respectively]........................................................ $60,737,516 $58,954,436
----------- -----------
----------- -----------
</TABLE>
See accompanying notes to financial statements.
14
<PAGE>
ADVANTUS SPECTRUM FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1996
(UNAUDITED)
(1) ORGANIZATION
The Advantus Spectrum 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 Spectrum Fund, Inc. (effective March 1,
1995). Prior to March 1, 1995 the Fund was known as MIMLIC Asset Allocation
Fund, 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 periods
decline as the amount of the purchase increases and range 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.
Income, expenses (other than distribution fees) and realized and unrealized
gains or losses are allocated to each class of shares based upon its relative
net assets.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies followed by 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 of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of increase and decrease in net assets from
operations during the period. Actual results could differ from those estimates.
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.
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS--CONTINUED
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
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.
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, 1995 to March 31, 1996, purchases of
securities and proceeds from sales, other than temporary investments in
short-term securities aggregated $49,785,428 and $54,156,368, respectively.
(4) EXPENSES AND RELATED PARTY TRANSACTIONS
On February 14, 1995 shareholders of the Fund approved a new investment
advisory agreement with Advantus Capital Management, Inc. (Advantus Capital).
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 .60 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
16
<PAGE>
NOTES TO FINANCIAL STATEMENTS--CONTINUED
(4) EXPENSES AND RELATED PARTY TRANSACTIONS--(CONTINUED)
Corporation (MIMLIC Sales), the underwriter of the Fund and wholly-owned
subsidiary of MIMLIC Management, 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 .35 percent of average daily net assets of Class A
shares. The Class B and Class C Plans provide for a fee up to 1.00 percent of
average daily net assets of Class B and Class C shares, respectively. The Class
B and Class C 1.00 percent fee is comprised of a .75 percent distribution fee
and a .25 percent service fee.
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, 1996, the administrative service fee was
$3,100 per month. Effective February 1, 1996, the administrative service fee is
$3,600 per month.
Advantus Capital 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 $157,146.
As of March 31, 1996, 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........................................................... 30,649 .8%
Class B........................................................... 4,266 1.2%
Class C........................................................... 816 2.2%
</TABLE>
Legal fees were paid to a law firm of which the Fund's secretary is a
partner in the amount of $1,276.
(5) CAPITAL SHARE TRANSACTIONS
Transactions in shares for the period from October 1, 1995 to March 31, 1996
and the year ended September 30, 1995 for Class A and Class B shares and the
period from October 1, 1995 to March 31, 1996 and the period from March 1, 1995
to September 30, 1995 for Class C shares were as follows:
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
----------------------- -------------------- --------------------
1996 1995 1996 1995 1996 1995
---------- ----------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Sold................................... 270,021 440,376 152,296 200,130 23,989 13,907
Issued for reinvested distributions.... 242,962 228,395 18,193 3,579 1,668 103
Redeemed............................... (547,386) (1,073,619) (14,674) (1,857) (2,215) (512)
---------- ----------- --------- --------- --------- ---------
(34,403) (404,848) 155,815 201,852 23,442 13,498
---------- ----------- --------- --------- --------- ---------
---------- ----------- --------- --------- --------- ---------
</TABLE>
17
<PAGE>
NOTES TO FINANCIAL STATEMENTS--CONTINUED
(6) RESTRICTED SECURITIES
At March 31, 1996, investments in securities includes issues which generally
cannot be offered for sale to the public without first being registered under
the Securities Act of 1933 (restricted security). In the event the securities
are registered, those carrying registration rights allow for the issuer to bear
all the related costs; for issues without rights, the Fund may incur such costs.
The Fund currently limits investments in securities that are not readily
marketable, including restricted securities, to 10% of net assets at the time of
the purchase. Securities are valued by procedures described in note 2. The
aggregate value of restricted securities held by the Fund at March 31, 1996 was
$403,056 which represents .7% of net assets.
18
<PAGE>
Notes to Financial Statements--continued
(7) Financial Highlights
Per share data for a share of capital stock and selected information for
each period are as follows:
<TABLE>
<CAPTION>
CLASS A
------------------------------------------------------------------------------------------------
PERIOD FROM PERIOD FROM
OCTOBER 1, NOVEMBER 1,
1995 TO YEAR ENDED 1993 TO YEAR ENDED OCTOBER 31,
MARCH 31, SEPTEMBER 30, SEPTEMBER 30, ------------------------------------------
1996 1995(A) 1994(G) 1993 1992 1991
--------------- --------------- --------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period....................... $ 14.79 $ 13.28 $ 13.92 $ 13.63 $ 13.05 $ 10.87
------- ------- ------- ------------ ------------ ------------
Income from investment
operations:
Net investment income....... .16 .45 .28 .29 .38 .48
Net gains or losses on
securities (both realized
and unrealized)............ .77 1.88 (.55) .86 1.01 2.28
------- ------- ------- ------------ ------------ ------------
Total from investment
operations............... .93 2.33 (.27) 1.15 1.39 2.76
------- ------- ------- ------------ ------------ ------------
Less distributions:
Dividends from net
investment
income..................... (.16) (.44) (.28) (.31) (.38) (.51)
Distributions from capital
gains...................... (.85) (.38) (.09) (.55) (.43) (.07)
------- ------- ------- ------------ ------------ ------------
Total distributions....... (1.01) (.82) (.37) (.86) (.81) (.58)
------- ------- ------- ------------ ------------ ------------
Net asset value, end of
period....................... $ 14.71 $ 14.79 $ 13.28 $ 13.92 $ 13.63 $ 13.05
------- ------- ------- ------------ ------------ ------------
------- ------- ------- ------------ ------------ ------------
Total return (b).............. 6.5%(c) 18.4% (1.9)%(d) 8.7% 11.1% 26.0%
Net assets, end of period
(in thousands)............... $ 54,803 $ 55,624 $ 55,286 $57,048 $38,417 $18,588
Ratio of expenses to average
daily net assets............. 1.29%(e) 1.33% 1.27%(e) 1.22% 1.35%(f) 1.35%(f)
Ratio of net investment income
to average daily net
assets....................... 2.11%(e) 3.22% 2.24%(e) 2.16% 3.02%(f) 4.07%(f)
Portfolio turnover rate
(excluding short-term
securities).................. 89.1% 125.5% 124.5% 92.1% 123.3% 56.2%
Average commission rate on
common stock transactions.... $ .0619 N/A N/A N/A N/A N/A
</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 assumes reinvestment of distributions at net asset value. Total return
figures do not reflect the impact of front-end and contingent deferred sales
charges.
(c) Total return is presented for the period from October 1, 1995 to March 31,
1996.
(d) Total return is presented for the period from November 1, 1993 to September
30, 1994.
(e) Adjusted to an annual basis.
(f) The Fund's Adviser voluntarily absorbed $13,585 and $19,759 in expenses for
the years ended October 31, 1992 and 1991, respectively. If Class A shares
had been charged for these expenses, the ratio of expenses to average daily
net assets would have been 1.40% and 1.50%, respectively, and the ratio of
net investment income to average daily net assets would have been 2.97% and
3.92%, respectively.
(g) During 1994, the Fund changed its fiscal year end from October 31 to
September 30.
19
<PAGE>
NOTES TO FINANCIAL STATEMENTS--CONTINUED
(7) FINANCIAL HIGHLIGHTS--(CONTINUED)
<TABLE>
<CAPTION>
CLASS B CLASS C
------------------------------------------------------- -------------------------------
PERIOD FROM PERIOD FROM PERIOD FROM PERIOD FROM
OCTOBER 1, AUGUST 19, OCTOBER 1, MARCH 1,
1995 TO YEAR ENDED 1994(A) TO 1995 TO 1995(A) TO
MARCH 31, SEPTEMBER 30, SEPTEMBER 30, MARCH 31, SEPTEMBER 30,
1996 1995(H) 1994 1996 1995
-------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period...................... $ 14.74 $ 13.27 $ 13.36 $ 14.74 $ 13.36
------ ------ ------ ------ ------
Income from investment
operations:
Net investment income....... .13 .39 .03 .13 .24
Net gains or losses on
securities (both realized
and unrealized)............ .75 1.84 (.03) .74 1.43
------ ------ ------ ------ ------
Total from investment
operations............... .88 2.23 -- .87 1.67
------ ------ ------ ------ ------
Less distributions:
Dividends from net
investment income.......... (.12) (.38) (.09) (.12) (.29)
Distributions from capital
gains...................... (.85) (.38) -- (.85) --
------ ------ ------ ------ ------
Total distributions....... (.97) (.76) (.09) (.98) (.29)
------ ------ ------ ------ ------
Net asset value, end of
period...................... $ 14.65 $ 14.74 $ 13.27 $ 14.64 $ 14.74
------ ------ ------ ------ ------
------ ------ ------ ------ ------
Total return (b).............. 6.2%(c) 17.6% (.04)%(d) 6.1%(c) 12.6%(e)
Net assets, end of period (in
thousands).................. $ 5,394 $ 3,131 $ 140 $ 541 $ 199
Ratio of expenses to average
dailynet assets............. 1.94%(f) 1.99% .23%(g) 1.93%(f) 2.00%(f)
Ratio of net investment income
to average daily net
assets...................... 1.44%(f) 2.30% .37%(g) 1.44%(f) 2.17%(f)
Portfolio turnover rate
(excluding short-term
securities)................. 89.1% 125.5% 124.5% 89.1% 125.5%
Average commission rate on
common stock transactions... $ .0619 N/A N/A $ .0619 N/A
</TABLE>
- ----------
(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 front-end and contingent deferred sales
charges.
(c) Total return is presented for the period from October 1, 1995 to March 31,
1996.
(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 September 30, 1995.
(f) Adjusted to an annual basis.
(g) Ratios presented for the period from August 19, 1994 to September 30, 1994
are not annualized as they are not indicative of anticipated results.
(h) 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.
20
<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 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 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 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 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.
21
<PAGE>
GROUP INVESTMENT PLAN: This plan provides employers and employees with a
convenient means for investing in the funds through payroll deduction.
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. Amounts
over $1,000 may be wire transferred to your personal bank account. The
prevailing wire charge will be added to the withdrawal amount. To set this up,
please send a voided check 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.
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. manages eight mutual funds containing $301
million in assets in addition to $1.2 billion in assets for other clients.
Advantus Capital's seasoned portfolio managers average more than 11 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
22
<PAGE>
THIS REPORT HAS BEEN PREPARED FOR SHAREHOLDERS AND MAY BE DISTRIBUTED
TO OTHERS ONLY IF PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS.
READ THE PROSPECTUS CAREFULLY BEFORE YOU INVEST.
[ADVANTUS -TM- FAMILY OF FUNDS]
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.48638 5-96
