----------------------------------------
THE
(LOGO) BOND FUND
FOR GROWTH
Semi-Annual Report
----------------------------------------
June 30, 1995
{LOGO)
This report is for the information of shareholders
of The Bond Fund For Growth. It may be used
as sales literature only when accompanied or
preceded by a current prospectus.
<PAGE>
(LOGO)
ROCHESTER FUND DISTRIBUTORS, INC. August 15, 1995
Dear Fellow Shareholder,
We are pleased to report that The Bond Fund For Growth enjoyed a strong
recovery during the six-month period ended June 30, 1995. Benefiting from both a
rally in the stock and bond markets, the six month total return for Class A
Shares of the Fund was an impressive +15.36%, reflecting an increase in the
Class A Share net asset value from $12.20 at December 31, 1994 to $13.73 on June
30, 1995 and dividends of $0.33 per share. This six month return does not
reflect payment of the maximum sales charge.
Despite this impressive record over the first six months of the year, we
remind investors that the performance reported is short term, and as always,
encourage our shareholders to maintain a long term perspective when reviewing
their investment portfolio. Class A Shares of the Fund have provided
shareholders an average annual return of 11.38%, 15.49% and 9.48% for the one
year, five year and life of fund periods respectively, through June 30, 1995
(the Fund's inception date was June 3, 1986). These numbers represent the
average annual change in value of an investment over the period and assume
payment of the maximum 3.25% sales charge for Class A Shares(1). Of course, past
performance is not predictive of future investment returns. The return and
principal value of an investment in the Fund will fluctuate, and an investor's
shares, when redeemed, may be worth more or less than their original cost.
When we last reported to shareholders at year end, we anticipated a
moderate year for convertibles in general, based on our modest expectations for
the bond and stock markets in 1995. However, the stock market has been climbing
virtually straight up since December(2), and no one knows when it will stop. If
this leaves you feeling somewhat apprehensive about a potential market
correction, you have chosen an appropriate investment vehicle. A study performed
by Salomon Brothers in March 1995 showed that convertibles, since their date of
issuance, have experienced only 50% of the downside in those common stocks of
the same issuer that have suffered a negative cumulative total return, but have
realized 118% of the upside in those that have tallied a positive cumulative
total return.(3) Of course, there is no assurance that these returns will be
achieved. They are based on past performance of various securities which may or
may not be held in The Bond Fund For Growth, and is in no way intended to
represent performance of the Fund. Also of interest is an article published in
The Value Line Mutual Fund Advisory, July 25, 1995, which says that "Given the
historically positive risk/reward tradeoff for convertibles, growth and income
investors should take a look at (The Bond Fund For Growth)." Of course, common
stocks offer greater appreciation than convertible securities, and traditional
bonds have greater cash flow, but the elements of risk and reward mentioned here
shouldn't be overlooked.
We look forward to reporting on the Fund's performance in the coming
months.
Sincerely,
MICHAEL S. ROSEN
----------------
Michael S. Rosen
Portfolio Manager
(1) The performance of Class B Shares and Class Y Shares will differ from that
of Class A Shares primarily due to the different expenses the classes of shares
incur. Class B Shares and Class Y Shares were introduced on May 1, 1995, and as
such, have no meaningful performance figures at this time. Class Y Shares are
available only to institutional investors.
(2) The Wall Street Journal, July 1, 1995.
(3) The study is based on all 590 convertible securities and their underlying
common stock that have been included in the unmanaged Salomon Brothers
Convertible Securities Index from December 31, 1991 to February 28, 1995. Call
our Marketing Department for a copy of the study. This letter is prepared for
shareholders of The Bond Fund For Growth, and should be preceded or accompanied
by a current prospectus. The Fund invests in high yield, lower rated bonds which
generally have greater price swings and higher default rates than higher rated
bonds. As such, the Fund is subject to certain risks, which are described in the
enclosed prospectus.
350 Linden Oaks
Rochester, NY 14625
716 383 1300
<PAGE>
THE
(LOGO) BOND FUND
FOR GROWTH
Portfolio Overview
Based on the market value as of June 30, 1995
Total Net Assets $191,113,959
Shares Outstanding:
Class A 13,347,495
Class B 447,716
Class Y 118,745
Number of Issues 166
Industry Sectors:
<TABLE>
<S> <C> <C> <C>
Apparel / Textile 0.6% Health Care Services 4.5%
Banking 7.3% Industrial Materials 0.4%
Chemicals 0.1% Machinery 1.8%
Computer Hardware 7.1% Pharmaceuticals 3.8%
Computer Software 2.1% Publishing / Broadcasting 2.3%
Construction / Building Supplies 4.6% Real Estate / Home Building 3.4%
Diversified Manufacturing 1.6% Retailing 4.9%
Electronics / Electrical / Mechanical Equip. 8.5% Security Services 2.4%
Employment Services 1.1% Telecommunications Equip. / Service 4.3%
Energy / Natural Resources 5.7% Toys 0.6%
Financial Services / Insurance 11.8% Transportation 1.6%
Food / Beverage / Tobacco 7.8% Travel / Leisure 5.7%
Forest / Paper Products 2.3% Waste Management / Env. Services 2.5%
Health Care / Medical Products 2.0% Total Investments as a
Percentage of Net Assets 100.8%
-----------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE>
<TABLE>
The Bond Fund For Growth
Portfolio of Investments
June 30, 1995 (Unaudited)
<CAPTION>
Interest Maturity Market
Par Value Security Description Rate Date Value
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CONVERTIBLE BONDS--70.7%
Apparel / Textile--0.6%
$ 400,000 Fieldcrest Cannon, Inc. 6.00% 03/15/12 $ 312,000
$ 800,000 Guilford Mills, Inc. 6.00% 09/15/12 760,000
-----------
Total $ 1,072,000
-----------------------------------------------------------------------------------------------------
Banking--1.8%
$ 500,000 Bangkok Bank Public Co. Ltd. (a) (d) 3.25% 03/03/04 515,000
$2,902,000 First Republic Bancorp Inc. 7.25% 12/01/02 3,061,610
-----------
Total $ 3,576,610
-----------------------------------------------------------------------------------------------------
Computer Hardware--7.1%
$1,500,000 Altera Corp. (d) 5.75% 06/15/02 $ 1,605,000
$2,000,000 Bay Networks, Inc. (d) 5.25% 05/15/03 1,847,500
$ 300,000 Comptronix Corp. 6.75% 03/01/02 210,000
$2,000,000 Comverse Technology, Inc. 5.25% 12/01/03 2,030,000
$1,425,000 Conner Peripherals, Inc. 6.50% 03/01/02 1,211,250
$ 500,000 Data General Corp. 7.75% 06/01/01 452,500
$ 750,000 Integrated Device Technology, Inc. 5.50% 06/01/02 791,250
$1,313,000 Iverson Technology Corp. (a) (b) (c) 8.25% 09/01/02 367,640
$ 400,000 LTX Corp. 13.50% 04/15/11 497,840
$1,653,000 Telxon Corp. 7.50% 06/01/12 1,692,259
$2,500,000 Unisys Corp. 8.25% 08/01/00 2,775,000
-----------
Total $13,480,239
-----------------------------------------------------------------------------------------------------
Computer Software--1.3%
$2,402,000 MacNeal-Schwendler Corp. 7.875% 08/18/04 $ 2,546,120
-----------------------------------------------------------------------------------------------------
Construction / Building Supplies--1.9%
$2,000,000 Cemex, S.A. de C.V. 4.25% 11/01/97 1,540,000
$1,000,000 Empresas ICA Sociedad
Controladora, S.A. de C.V. 5.00% 03/15/04 540,000
$ 750,000 Interface, Inc. 8.00% 09/15/13 727,500
$ 575,000 Medusa Corp. 6.00% 11/15/03 557,750
$ 500,000 Nippon Denro Ispat Ltd. (a) (d) 3.00% 04/01/01 302,500
-----------
Total $ 3,667,750
-----------------------------------------------------------------------------------------------------
Diversified Manufacturing--1.4%
$3,000,000 Mascotech, Inc. 4.50% 12/15/03 2,193,750
$ 500,000 Park-Ohio Industries, Inc. 7.25% 06/15/04 442,500
-----------
Total $ 2,636,250
-----------------------------------------------------------------------------------------------------
Electronics / Electrical / Mechanical Equipment--7.9%
$ 500,000 Aeroflex, Inc. 7.50% 06/15/04 490,000
$2,500,000 Audiovox Corp. (d) 6.25% 03/15/01 1,525,000
$ 455,000 Aurora Electronics, Inc. 7.75% 04/15/01 222,950
$2,000,000 California Microwave, Inc. 5.25% 12/15/03 2,110,000
$1,000,000 Cooper Industries, Inc. 7.05% 01/01/15 1,043,750
</TABLE>
3
<PAGE>
<TABLE>
The Bond Fund For Growth
Portfolio of Investments
June 30, 1995 (Unaudited)
<CAPTION>
Interest Maturity Market
Par Value Security Description Rate Date Value
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Electronics / Electrical / Mechanical Equipment (continued)
$ 3,044,000 Ducommun Inc. 7.75% 03/31/11 $ 2,800,480
$ 3,000,000 Fisher Scientific International Inc. 4.75% 03/01/03 3,251,250
$ 650,000 MagneTek, Inc. 8.00% 09/15/01 650,000
$ 1,440,000 Recognition International, Inc. 7.25% 04/15/11 1,188,000
$ 1,000,000 TRINOVA Corp. 6.00% 10/15/02 945,000
$ 1,000,000 Zenith Electronics Corp. (d) 8.50% 01/18/01 980,000
-----------
Total $15,206,430
------------------------------------------------------------------------------------------------------
Employment Services--1.1%
$ 2,000,000 Olsten Corp. 4.875% 05/15/03 $ 2,120,000
------------------------------------------------------------------------------------------------------
Energy / Natural Resources--3.2%
$ 2,400,000 AES Corp. 6.50% 03/15/02 2,364,000
$ 500,000 GE Capital Corp. Global Medium-
Term Notes (a) (d) 2.50% 02/14/97 507,500
$ 980,000 IMC Global, Inc. 6.25% 12/01/01 1,002,050
$ 500,000 Inco Ltd. 5.75% 07/01/04 570,000
$ 750,000 Oryx Energy Co. 7.50% 05/15/14 660,000
$ 1,000,000 USX--US Steel Group, Inc./USX-
Marathon Group 7.00% 06/15/17 922,500
-----------
Total $ 6,026,050
------------------------------------------------------------------------------------------------------
Financial Services / Insurance--5.7%
$ 750,000 Alexander & Alexander Services, Inc. 11.00% 04/15/07 768,750
$ 2,400,000 Chubb Corp. 6.00% 05/15/98 2,475,000
$ 1,100,000 Legg Mason, Inc. 5.25% 05/01/03 1,221,000
$ 750,000 Leucadia National Corp. 5.25% 02/01/03 768,750
$ 3,750,000 Lomas Financial Corp. 9.00% 10/31/03 562,500
$ 1,325,000 Old Republic International Corp. 5.75% 08/15/02 1,424,375
$ 1,000,000 Trenwick Group Inc. 6.00% 12/15/99 1,015,000
$ 2,830,000 Waterhouse Investor Services, Inc. 6.00% 12/15/03 2,674,350
-----------
Total $10,909,725
------------------------------------------------------------------------------------------------------
Food / Beverage / Tobacco--5.8%
$ 2,325,000 American Brands, Inc. 7.75% 06/15/02 3,154,792
$ 1,325,000 Chock Full O' Nuts Corp. 8.00% 09/15/06 1,321,687
$ 2,000,000 Flagstar Cos. Inc. 10.00% 11/01/14 1,420,000
$ 1,250,000 Grand Metropolitan PLC (d) 6.50% 01/31/00 1,339,063
$ 3,500,000 Standard Commercial Corp. 7.25% 03/31/07 2,695,000
$ 1,000,000 Starbucks Corp. 4.50% 08/01/03 1,227,500
-----------
Total $11,158,042
------------------------------------------------------------------------------------------------------
Forest / Paper Products--1.9%
$ 1,000,000 International Paper Co. 5.75% 09/23/02 1,205,000
$ 2,500,000 Stone Container Corp. 6.75% 02/15/07 2,412,500
-----------
Total $ 3,617,500
------------------------------------------------------------------------------------------------------
</TABLE>
4
<PAGE>
<TABLE>
The Bond Fund For Growth
Portfolio of Investments
June 30, 1995 (Unaudited)
<CAPTION>
Interest Maturity Market
Par Value Security Description Rate Date Value
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Health Care / Medical Products--1.7%
$ 500,000 AMSCO International, Inc. 4.50% 10/15/02 $ 440,000
$1,175,000 Cabot Medical Corp. 7.50% 03/01/99 1,128,000
$ 500,000 Maxxim Medical, Inc. 6.75% 03/01/03 505,000
$1,450,000 MEDIQ Inc. (NutraMax Products, Inc.) 7.50% 07/15/03 1,203,500
----------
Total $3,276,500
-----------------------------------------------------------------------------------------------------
Health Care Services--3.0%
$ 750,000 Careline, Inc. 8.00% 05/01/01 714,375
$ 700,000 Integrated Health Services, Inc. 5.75% 01/01/01 756,000
$1,900,000 Pacific Physicians Services, Inc. 5.50% 12/15/03 1,463,000
$2,000,000 Pharmaceutical Marketing Services, Inc. 6.25% 02/01/03 1,400,000
$ 500,000 Physicians Clinical Laboratory, Inc. (a) (d) 7.50% 08/15/00 375,000
$1,000,000 TheraTx, Inc. (d) 8.00% 02/01/02 935,000
----------
Total $5,643,375
-----------------------------------------------------------------------------------------------------
Machinery--1.8%
$2,750,000 Raymond Corp. 6.50% 12/15/03 $3,410,000
-----------------------------------------------------------------------------------------------------
Pharmaceuticals--2.3%
$ 800,000 Bindley Western Industries, Inc. 6.50% 10/01/02 801,000
$ 800,000 Cetus Corp. (Chiron Corp.) 5.25% 05/21/02 712,000
$1,750,000 Chiron Corp. (d) 1.90% 11/17/00 1,400,000
$1,000,000 Elan International Finance, Ltd. 0.00% 10/16/12 467,500
$ 500,000 ICN Pharmaceuticals, Inc. 8.50% 11/15/99 490,000
$ 500,000 IVAX Corp. (d) 6.50% 11/15/01 485,000
----------
Total $4,355,500
-----------------------------------------------------------------------------------------------------
Publishing / Broadcasting--2.3%
$ 750,000 Graphic Industries, Inc. 7.00% 05/15/06 652,500
$3,500,000 Time Warner, Inc. 8.75% 01/10/15 3,661,875
----------
Total $4,314,375
-----------------------------------------------------------------------------------------------------
Real Estate / Home Building--3.4%
$2,000,000 Engle Homes, Inc. 7.00% 03/01/03 1,760,000
$1,150,000 Henderson Capital International Ltd. 4.50% 10/27/96 1,150,000
$ 500,000 Hysan Development Co. Ltd. (a) (d) 5.75% 06/01/00 497,900
$2,885,000 Patten Corp. 8.25% 05/15/12 2,408,975
$ 890,000 U.S. Home Corp. 4.875% 11/01/05 734,250
----------
Total $6,551,125
-----------------------------------------------------------------------------------------------------
Retailing--4.9%
$2,200,000 Ben Franklin Retail Stores, Inc. 7.50% 06/01/03 1,771,000
$ 400,000 Eagle Hardware & Garden, Inc. 6.25% 03/15/01 283,500
$1,385,000 General Host Corp. 8.00% 02/15/02 1,301,900
$2,300,000 Michaels Stores, Inc. 4.75% 01/15/03 2,093,000
</TABLE>
5
<PAGE>
<TABLE>
The Bond Fund For Growth
Portfolio of Investments
June 30, 1995 (Unaudited)
<CAPTION>
Interest Maturity Market
Par Value Security Description Rate Date Value
-----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Retailing (continued)
$ 500,000 Pier 1 Imports, Inc.
(General Host Corp.) (a) (d) 8.50% 12/01/00 $ 569,375
$2,500,000 Proffitt's, Inc. 4.75% 11/01/03 2,206,250
$1,500,000 Sports & Recreation, Inc. 4.25% 11/01/00 1,125,000
------------
Total $ 9,350,025
-----------------------------------------------------------------------------------------------------
Security Services--2.4%
$5,000,000 ADT Operations, Inc. (ADT Ltd.) LYONS 0.00% 07/06/10 1,968,750
$2,250,000 Laidlaw Inc. (ADT Ltd.) (d) 6.00% 01/15/99 2,542,500
------------
Total $ 4,511,250
-----------------------------------------------------------------------------------------------------
Telecommunications Equipment/Service--1.8%
$1,400,000 Arch Communications Group, Inc. (d) 6.75% 12/01/03 1,855,000
$ 500,000 Compania de Telefonos de Chile 4.50% 01/15/03 550,000
$1,800,000 Porta Systems Corp. (c) 6.00% 17/01/02 585,500
$ 500,000 Telekom Malaysia Berhad (a)(d) 4.00% 10/03/04 482,500
-------------
Total $ 3,472,500
-----------------------------------------------------------------------------------------------------
Toys--0.6%
$1,000,000 Hasbro, Inc. 6.00% 11/15/98 $ 1,107,500
-----------------------------------------------------------------------------------------------------
Transportation--0.3%
$ 500,000 Varlen Corp. 6.50% 06/01/03 $ 530,000
-----------------------------------------------------------------------------------------------------
Travel/Leisure--5.1%
$2,165,000 Bell Sports Corp. 4.25% 11/15/00 1,618,337
$1,500,000 Microtel Franchise & Dev. Corp. (a) (b) (e) 8.00% 02/01/04 2,325,000
$1,500,000 Microtel Franchise & Dev. Corp. (a) (b) (e) 8.00% 02/01/05 2,325,000
$ 200,000 Travel Ports of America, Inc. (a) 8.50% 01/15/05 200,000
$1,500,000 Travel Ports of America, Inc. (a) (d) 8.50% 01/15/05 1,500,000
$2,000,000 WMS Industries Inc. 5.75% 11/30/02 1,770,000
------------
Total $ 9,738,337
-----------------------------------------------------------------------------------------------------
Waste Management/Environmental Services--1.4%
$ 250,000 USA Waste Services, Inc. 8.50% 10/15/02 297,500
$ 458,000 Roy F. Weston, Inc. 7.00% 04/15/02 384,720
$2,466,000 WMX Technologies, Inc. 2.00% 01/24/05 2,074,523
------------
Total $ 2,756,743
-----------------------------------------------------------------------------------------------------
Total convertible bonds (cost $132,012,114) $135,033,946
=====================================================================================================
</TABLE>
6
<PAGE>
Portfolio of Investments
June 30, 1995 (Unaudited)
Annual Market
Shares Security Description Dividend Value
-------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCKS--27.2%
Banking--5.0%
7,500 Mid Am, Inc. Series A $1.8125 $ 255,000
89,000 ONBANCorp, Inc. Series B $1.6875 2,341,812
1,000 Republic NY Corp. $ 3.375 57,750
167,800 Rochester Community Savings
Bank Series B(f) $ 1.75 5,338,138
17,500 Sovereign Bancorp, Inc. Series B $ 3.125 945,000
18,000 Union Planters Corp. Series E $ 2.00 622,125
----------
Total $9,559,825
-------------------------------------------------------------------------------
Chemicals--0.1%
2,150 LSB Industries, Inc. Series 2 $ 3.25 $ 79,819
-------------------------------------------------------------------------------
Computer Software - 0.8%
15,000 Salomon Inc.--Microsoft Corp. ELKS $ 3.99 $1,516,875
-------------------------------------------------------------------------------
Construction/Building Supplies--2.7%
75,000 Owens-Corning Capital L.L.C. MIPS (d) $ 3.25 3,862,500
30,000 WHX Corp. Series B $ 3.75 1,308,750
----------
Total $5,171,250
-------------------------------------------------------------------------------
Diversified Manufacturing--0.2%
30,000 Mascotech, Inc. DECS $ 1.20 $ 427,500
-------------------------------------------------------------------------------
Electronics/Electrical/Mechanical Equipment--0.6%
20,000 Kaman Corp. $ 3.25 $1,100,000
-------------------------------------------------------------------------------
Energy/Natural Resources--2.4%
16,000 Cyprus Amax Minerals Co. Series A $ 4.00 1,000,000
20,000 Gerrity Oil & Gas Corp. $ 1.50 230,000
85,000 ICO, Inc. $1.6875 1,657,500
116,900 Kaiser Aluminum Corp. Series A $ 0.65 1,125,162
20,000 KENETECH Corp. PRIDES $ 1.67 282,500
8,000 Western Gas Resources, Inc. $ 2.625 280,000
----------
Total $4,575,162
-------------------------------------------------------------------------------
Financial Services/Insurance--5.5%
15,000 Alexander & Alexander Services, Inc. (d) $ 3.625 750,000
10,000 Allstate Corporation (PMI Group, Inc.) $ 2.30 407,500
21,500 American General Delaware, L.L.C.
MIPS Series A $ 3.00 1,115,312
10,000 Aon Corp. $ 3.125 537,500
110,000 Capstead Mortgage Corp. Series B $ 1.26 1,388,750
8,000 Conseco, Inc. Series D $ 3.25 349,000
25,000 St. Paul Capital L.L.C. MIPS $ 3.00 1,306,250
50,000 SunAmerica Inc. PERCS Series D $ 2.78 2,300,000
7
<PAGE>
The Bond Fund For Growth
Portfolio of Investments
June 30, 1995 (Unaudited)
Annual Market
Shares Security Description Dividend Value
-------------------------------------------------------------------------------
Financial Services / Insurance (continued)
30,000 Travelers Group, Inc. Series B $ 2.75 $ 1,886,250
12,000 United Cos. Financial Corp. PRIDES $ 2.97 537,000
-----------
Total $10,577,562
-------------------------------------------------------------------------------
Food / Beverage / Tobacco - 1.1%
353,900 RJR Nabisco Holdings Corp. PERCS $0.60125 $ 2,123,400
-------------------------------------------------------------------------------
Forest / Paper Products - 0.4 %
5,100 Federal Paper Board Co., Inc. $ 2.875 329,588
5,000 James River Corp. Series K $ 3.375 223,750
5,000 Sonoco Products Co. Series A $ 2.25 277,500
-----------
Total $ 830,838
-------------------------------------------------------------------------------
Health Care / Medical Products - 0.3%
20,000 U.S. Surgical Corp. DECS $ 2.20 $ 510,000
-------------------------------------------------------------------------------
Health Care Services - 1.2%
43,300 Beverly Enterprises, Inc. $ 2.75 $ 2,262,425
-------------------------------------------------------------------------------
Industrial Materials - 0.4%
15,000 Corning Delaware, L.P. MIPS $ 3.00 $ 766,875
-------------------------------------------------------------------------------
Pharmaceuticals - 1.1%
10,000 Bear Stearns Cos. Inc. - Merck &
Co., Inc. CHIPS $ 2.01 427,500
15,000 Lehman Brothers Holdings Inc. -
Amgen Inc. YEELDS $ 2.94 853,125
14,000 Salomon Inc. - Amgen Inc. ELKS $ 3.19 855,750
-----------
Total $ 2,136,375
-------------------------------------------------------------------------------
Telecommunications Equipment / Service - 2.4%
10,000 First Chicago Corp. (Nextel
Communications, Inc.) DEC $ 1.99 175,000
15,000 LCI International, Inc. $ 1.25 621,563
70,000 MFS Communications Co., Inc. $ 2.68 2,423,750
8,000 Morgan Stanley Group Inc. - Telefonos
de Mexico S.A. de C.V. PERQS $ 3.78 305,000
4,000 Philippine Long Distance
Telephone Co. $ 3.50 253,500
25,000 Sprint Corp. (Southern New England
Telecommunications Corp.) DEC $ 2.6296 868,750
-----------
Total $ 4,647,563
-------------------------------------------------------------------------------
8
<PAGE>
The Bond Fund For Growth
Portfolio of Investments
June 30, 1995 (Unaudited)
Annual Market
Shares Security Description Dividend Value
-------------------------------------------------------------------------------
Transportation - 1.3%
50,000 Arkansas Best Corp. $2.875 $ 1,850,000
2,000 Ford Motor Co. Series A $ 4.20 194,250
7,000 General Motors Corp. Series C $ 3.25 441,000
-----------
Total $ 2,485,250
-------------------------------------------------------------------------------
Travel / Leisure - 0.6%
40,700 Morgan Stanley Group Inc. - International
Game Technology PERQS $1.235 702,075
10,000 Salomon Inc. - Promus Cos. Inc. ELKS $ 3.02 407,500
-----------
Total $ 1,109,575
-------------------------------------------------------------------------------
Waste Management / Environmental Services - 1.1%
35,000 Browning-Ferris Industries, Inc. $ 2.58 1,277,500
50,000 International Technology Corp. $ 1.75 906,250
-----------
Total $ 2,183,750
-------------------------------------------------------------------------------
Total convertible preferred stocks (cost $49,826,140) $52,064,044
-------------------------------------------------------------------------------
Market
Shares Security Description Value
-------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS - 2.9%
Banking - 0.5%
13,910 Fleet Financial Group, Inc. (f) $ 516,409
17,588 Progressive Bank, Inc. 450,693
-----------
Total $ 967,102
-------------------------------------------------------------------------------
Energy / Natural Resources - 0.1%
11,930 J. Ray McDermott, S.A. (c $ 263,951
-------------------------------------------------------------------------------
Financial Services / Insurance - 0.6%
30,001 Orion Capital Corp. $ 1,170,039
-------------------------------------------------------------------------------
Food / Beverage / Tobacco - 0.9%
22,000 Philip Morris Cos., Inc. (f) $ 1,636,250
-------------------------------------------------------------------------------
Health Care Services - 0.3%
9,100 Columbia/HCA Healthcare Corp. 393,575
14,174 Tenet Healthcare Corp. (c) (f) 203,751
-----------
Total $ 597,326
-------------------------------------------------------------------------------
Pharmaceuticals - 0.4%
10,020 American Home Products Corp. (f) $ 775,298
-------------------------------------------------------------------------------
Telecommunications Equipment / Service - 0.1%
10,000 Frontier Corp. (f) $ 240,000
-------------------------------------------------------------------------------
9
<PAGE>
The Bond Fund For Growth
Portfolio of Investments
June 30, 1995 (Unaudited)
Market
Shares Security Description Value
-------------------------------------------------------------------------------
Travel/Leisure - 0.0%
5,000 Travel Ports of America, Inc., warrants,
strike $3.60, Exp. 1/15/05 (a) (c) $ 1,250
-------------------------------------------------------------------------------
Total common stocks and warrants (cost $1,805,906) $ 5,651,216
===============================================================================
Total investments (cost $183,644,160)--100.8% $192,749,206
------------
CALL OPTIONS OUTSTANDING--(0.1%)
Exercise
Shares Months/
Subject Liabilities for Call Exercise Market
To Call Options Outstanding Price Value
-------------------------------------------------------------------------------
10,000 American Home Products Corp. Jul/70 $ (74,375)
13,900 Fleet Financial Group, Inc. Jul/35 (33,013)
10,000 Frontier Corp. Jul/22.5 (13,750)
10,000 Philip Morris Cos., Inc. Jan/70 (78,750)
41,000 Rochester Community Savings Bank Jul/20 (15,375)
10,000 Rochester Community Savings Bank Jul/22.5 (1,875)
20,000 Rochester Community Savings Bank Oct/20 (27,500)
42,000 Rochester Community Savings Bank Oct/22.5 (26,250)
11,600 Tenet Healthcare Corp. Aug/15 (4,350)
-------------------------------------------------------------------------------
Total call options outstanding (premiums received $233,918) ($ 275,238)
------------
Other assets and liabilities (net)--(0.7%) (1,360,009)
------------
Net assets at market--100.0% $191,113,959
============
(a) Illiquid security. (d) SEC Rule 144A restriction (See Note 3).
(b) Fair valued security. (e) Restricted security (See Note 3).
(c) Non-income producing security. (f) Security held in connection with
call option outstanding.
See accompanying notes to financial statements.
===============================================================================
Portfolio Abbreviations Asset Composition Table
June 30, 1995 (Unaudited)
CHIPS Common-linked Higher Income Participation
Securities
DEC Debt Exchangeable for Common Stock Percentage
DECS Dividend Enhanced Convertible Stock Rating of Bonds
------ --------
ELKS Equity-Linked Securities AAA 0.4%
LYONS Liquid Yield Option Notes AA 2.9%
MIPS Monthly Income Preferred Securities A 7.4%
PERCS Preferred Equity Redemption Cumulative Stock BBB 12.8%
PERQS Performance Equity-linked Redemption
Quarterly-pay Securities BB 16.0%
PRIDES Preferred Redeemable Increased Dividend
Equity Securities B 39.6%
TECONS Term Convertible Shares Below B 3.3%
YEELDS Yield Enhanced Equity Linked Debt Securities Not rated 17.6%
------
Total 100.0%
======
10
<PAGE>
The Bond Fund For Growth
-------------------------------------------------------------------------------
Statement of Assets and Liabilities
June 30, 1995 (Unaudited)
Assets
Investments at market
(Cost $183,644,160) $192,749,206
Cash and cash equivalents 4,349,389
Dividends and interest receivable 2,514,700
Receivable for capital shares sold 2,260,225
Receivable for investments sold 384,301
Other assets 33,046
------------
Total assets 202,290,867
------------
Liabilities
Payable for investments purchased 9,032,156
Payable for capital shares repurchased 281,169
Distributions payable to shareholders 332,008
Call options outstanding
(Premiums received $233,918) 275,238
Accrued taxes 1,255,916
Other liabilities 421
------------
Total liabilities 11,176,908
------------
Net Assets $191,113,959
============
-------------------------------------------------------------------------------
Represented by
Paid in capital $175,123,275
Undistributed net investment income 2,984,254
Accumulated net realized gain on investment transactions 3,942,704
Net unrealized appreciation of investments and options 9,063,726
------------
Total - Representing net assets applicable to capital shares
outstanding $191,113,959
============
-------------------------------------------------------------------------------
Computation of net asset value and offering price
Class A Shares:
Net asset value and redemption price per share
($183,325,647 divided by 13,347,495 shares) $13.73
============
Offering price per share (100/96.75 of $13.73) * $14.19
============
Class B Shares:
Net asset value, redemption price and offering price per
share ($6,156,897 divided by 447,716 shares) + $13.75
============
Class Y Shares:
Net asset value, redemption price and offering price per
share ($1,631,415 divided by 118,745 shares) $13.74
============
* On single retail sales of less than $250,000. On sales of $250,000
or more and on group sales the offering price is reduced.
+ Redemption price per share is equal to net asset value less
any applicable contingent deferred sales charge.
See accompanying notes to financial statements.
11
<PAGE>
The Bond Fund For Growth
-------------------------------------------------------------------------------
Statement of Operations
(Unaudited)
Six months ended June 30, 1995
Investment Income:
Interest $ 4,253,842
Dividends 911,791
-----------
Total investment income 5,165,633
-----------
Expenses:
Distribution fees - Class A 546,601
Distribution fees - Class B 2,833
Distribution fees - Class Y 426
Management fees 401,686
Shareholder servicing agent fees - Class A 95,637
Shareholder servicing agent fees - Class B 398
Shareholder servicing agent fees - Class Y 112
Registration fees 54,445
Accounting and auditing 35,891
Shareholder communications 27,803
Legal fees 12,433
Trustees' fees 2,900
Miscellaneous 9,864
Interest 3,071
-----------
Total expenses 1,194,100
-----------
Net investment income 3,971,533
-----------
Realized and unrealized gain on investments and options:
Net realized gain on investments 4,281,891
-----------
Net increase in unrealized appreciation:
Investments 13,390,566
Options 70,876
-----------
Total increase in unrealized appreciation 13,461,442
-----------
Net gain on investments and options 17,743,333
-----------
Net increase in net assets resulting from operations $21,714,866
===========
Statement of Changes in Net Assets
Six months ended
June 30, 1995 Year ended
(Unaudited) Dec. 31, 1994
---------------- -------------
Increase in net assets -
Operations:
Net investment income $ 3,971,533 $ 5,552,021
Net realized gain from security transactions 4,281,891 2,246,856
Increase (decrease) in unrealized appreciation 13,461,442 (10,516,166)
------------ ------------
Increase (decrease) in net assets resulting
from operations 21,714,866 (2,717,289)
------------ ------------
Distributions to shareholders from:
Net investment income - Class A (3,933,821) (5,616,654)
Net investment income - Class B (17,917) --
Net investment income - Class Y (10,612) --
Capital gains - Class A -- (1,445,043)
------------ ------------
Total distributions to shareholders (3,962,350) (7,061,697)
------------ ------------
Fund share transactions:
Increase in net assets derived from
Fund share transactions (Note 5) 46,670,410 67,095,060
------------ ------------
Increase in net assets 64,422,926 57,316,074
Net assets:
Beginning of period 126,691,033 69,374,959
------------ ------------
End of period 191,113,959 $126,691,033
============ ============
See accompanying notes to financial statements.
12
<PAGE>
The Bond Fund For Growth
Notes to Financial Statements
June 30, 1995 (Unaudited)
Note 1. Significant Accounting Policies:
The Bond Fund For Growth (the "Fund") is registered under the Investment Company
Act of 1940, as amended, as a non-diversified, open-end management investment
company. The Fund offers Class A, Class B and Class Y shares. Class A shares are
sold with a front-end sales charge. Class B shares may be subject to a
contingent deferred sales charge. Class Y shares are sold only to qualified
institutions and are not subject to any sales charge. All three classes of
shares have identical rights to earnings, assets and voting privileges, except
that each class has its own distribution plan, expenses directly attributable to
a particular class and exclusive voting rights with respect to matters affecting
a single class. Class B shares will automatically convert to Class A shares six
years after the date of purchase. The following is a summary of significant
accounting policies consistently followed by the Fund in the preparation of its
financial statements:
Security valuation. Investments in securities traded on a national securities
exchange are valued at the closing sales price on the last business day of the
period; securities traded in the over-the-counter market, listed securities for
which no sale was reported on that date and exchange traded convertible bonds
where the last sales price is not considered to be representative of the most
recent bid and ask prices are valued at the mean between the bid and ask prices.
In some instances, securities which trade on an exchange or in the
over-the-counter market, but trade more actively in a dealer market, are valued
at the mean of the reported bid and ask price by a dealer. Securities for which
market quotations are not readily available are valued at fair value as
determined in good faith by the Board of Trustees.
Security transactions and related investment income. Security transactions are
recorded on the trade date. Cost is determined and realized gains and losses are
based upon the specific identification method for both financial statement and
federal income tax purposes. Interest income is recorded on the accrual basis.
In computing net investment income, the Fund accretes original issue discount.
Market discount is accreted at the time of sale (to the extent of the lesser of
the accrued market discount or the disposition gain) and is treated as income,
rather than capital gain. Dividend income is recorded on the ex-dividend date.
Call options. Call options are written by the Fund only on securities owned by
the Fund and all such options are listed on a national securities exchange. When
the Fund sells an option, the premium received is recorded in the Statement of
Assets and Liabilities as an asset and as an equivalent liability. The amount of
the liability is subsequently adjusted to reflect the current market value of
the option written. The Fund's use of written options involves, to varying
degrees, elements of market risk in excess of the amount recognized in the
Statement of Assets and Liabilities. The contract amounts reflect the extent of
the Fund's involvement in these financial instruments. Risks arise from the
possible movements in securities' values underlying these instruments. The
Fund's activities in written options are conducted through regulated exchanges
which do not result in counterparty credit risks.
Allocation of income, expenses and gains and losses. Income, expenses (other
than those attributable to a specific class) and gains and losses are allocated
daily to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
Distributions to shareholders. Income distributions are declared and recorded
separately for Class A, Class B and Class Y shares each day based on estimated
net investment income. Such distributions are paid quarterly. Capital
13
<PAGE>
gain distributions, if any, are recorded on the ex-dividend date and paid
annually. As of June 30, 1995, the Fund has undistributed net investment income
of approximately $3,000,000 resulting from the acquisition of Rochester Tax
Managed Fund, Inc. by the Fund on June 28, 1995 (see Note 6). This undistributed
net investment income will be distributed to Fund shareholders throughout the
remainder of 1995.
Federal income taxes. During any particular year, the Fund is required to
distribute certain minimum amounts of net realized capital gains and net
investment income in order to avoid a federal income or excise tax. It is the
Fund's intention to comply with the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
taxable and tax-exempt income to shareholders. As of June 30, 1995, the Fund has
an accrued tax liability of $1,255,916 for estimated 1995 federal and state
taxes, and for net unrealized gains at the time of the acquisition of Rochester
Tax Managed Fund, Inc. by the Fund (see Note 6).
Reclassification of capital accounts. In 1993, the Fund adopted the provisions
of Statement of Position 93-2 "Determination, Disclosure and Financial Statement
Presentation of Income, Capital Gain and Return of Capital Distributions by
Investment Companies" (SOP). The SOP requires the Fund to report the
undistributed net investment income (accumulated loss) and accumulated net
realized gain (loss) accounts in such a manner as to approximate amounts
available for future tax distributions (or to offset future realized capital
gains). The initial implementation of the SOP did not have a significant impact
on the Fund; however, in 1994, the Fund reclassified $537,915 from accumulated
net realized gain to undistributed net investment income. This reclassification,
which has no impact on net investment income or total net assets of the Fund, is
primarily caused by accumulated market discount on bonds sold, which is an
element of capital gains and losses for book purposes and is considered ordinary
income for tax purposes.
Note 2. Management Fee and Other Transactions with Affiliated Parties:
Ronald H. Fielding, President and a trustee of the Fund, is also an officer,
director, and controlling shareholder of Fielding Management Company, Inc.
(FMC), the Fund's investment adviser, as well as an officer, director and
controlling shareholder of Rochester Fund Distributors, Inc. (RFD), the Fund's
principal underwriter, and an officer, director and controlling shareholder of
Rochester Fund Services, Inc. (RFS), the Fund's shareholder servicing,
accounting and pricing agent.
The management fee payable to FMC is based on an annual rate of .625% of average
daily net assets up to $50 million, .50% of average daily net assets on the next
$250 million, and .4375% of average daily net assets in excess of $300 million.
For the period ended June 30, 1995, FMC received fees of $401,686 for management
and investment advisory services.
The Fund has adopted a distribution plan with respect to its Class A shares (the
"Class A Plan") pursuant to Rule 12b-1 of the Investment Company Act of 1940, as
amended, which permits the Fund to pay an asset based sales charge of up to .50%
per annum of its relative net assets attributable to Class A Shares for certain
sales related distribution expenses and a service fee of up to .25% per annum of
relative net assets attributable to Class A shares for expenses incurred in
connection with the maintenance of shareholder accounts. For the period ended
June 30, 1995, the Fund paid distribution fees on the Class A Plan of $546,601
to RFD. From this amount, RFD made payments of $352,470 to broker dealers and
financial institutions.
The Fund has adopted a separate distribution plan with respect to its Class B
shares (the "Class B Plan") pursuant to Rule 12b-1 of the Investment Company Act
of 1940, as amended, which permits the Fund to pay an asset based sales charge
of up to .75% per annum of its relative net assets attributable to Class B
Shares for certain sales related distribution expenses and a service fee of up
to .25% per annum of relative net assets attributable to Class B shares
14
<PAGE>
for expenses incurred in connection with the maintenance of shareholder
accounts. For the period ended June 30, 1995, the Fund paid distribution fees on
the Class B Plan of $2,833 to RFD.
The Fund has also adopted a distribution plan with respect to its Class Y shares
(the "Class Y Plan") pursuant to Rule 12b-1 of the Investment Company Act of
1940, as amended, which permits the Fund to pay a service fee of up to .25% per
annum of relative net assets attributable to Class Y shares for expenses
incurred in connection with the maintenance of shareholder accounts. For the
period ended June 30, 1995, the Fund paid distribution fees on the Class Y Plan
of $426 to RFD.
For the six month period ended June 30, 1995, RFD, acting as underwriter,
received $91,818 as its portion of the sales charge from the sale of Class A
shares of the Fund. Class B shares are sold without an initial sales charge;
however, RFD pays a sales commission of 3% (including a prepaid service fee of
.25%) to dealers who sell Class B shares. A contingent deferred sales charge is
imposed on Class B share redemptions within six years of purchase. RFD has
received no contingent deferred sales charges from redemptions of Class B shares
for the period ended June 30, 1995. Class Y shares are sold without an initial
sales charge or a contingent deferred sales charge.
The shareholder servicing agent fee charged by RFS to the Fund is based on an
annual maintenance fee of $24.12 for each Class A and Class Y shareholder
account and $26.02 for each Class B shareholder account. For the period ended
June 30, 1995, RFS received $95,637, $398 and $112 in shareholder servicing
agent fees for Class A, Class B and Class Y shares, respectively. For the six
month period ended June 30, 1995, the Fund was charged $24,525 by RFS for
pricing and accounting services.
Note 3. Portfolio Information:
Purchases at cost and proceeds from sales of investment securities for the six
month period ending June 30, 1995 were $76,946,053 and $34,218,888,
respectively.
The Fund had transactions in call options as follows:
Number of
Contracts Premiums
--------- --------
Options Outstanding at
December 31, 1994 0 $ 0
Options written 1,030 141,501
Options acquired as a result of the
June 28, 1995 acquisition of
Rochester Tax Managed Fund, Inc. 655 92,417
----- --------
Options outstanding at
June 30, 1995 1,685 $233,918
===== ========
15
<PAGE>
The Fund held $28,526,338 in restricted securities at June 30, 1995, comprising
approximately 14.9% of net assets. The majority of these securities, although
not registered under the Securities Act of 1933, as amended (the "Act"), may be
resold to certain qualified institutional buyers in reliance upon Rule 144A
under the Act.
Date of Purchase % of
Description Acquisition Cost Net Assets
----------- ----------- -------- ----------
Alexander & Alexander Services, $3.625* 3/94 & 1/95 $ 638,750 0.4%
Altera Corp., 5.75%, 2002* 6/95 1,500,000 0.8%
Arch Communications Group, 6.75%, 2003* 6/94 - 4/95 1,485,000 1.0%
Audiovox, 6.25%, 2001* 6/94 - 5/95 1,785,000 0.8%
Bangkok Bank PLC, 3.25%, 2004* 2/94 500,000 0.3%
Bay Networks, 5.25%, 2003* 9/94 - 10/94 1,418,250 1.0%
Chiron, 1.9%, 2000* 11/93 & 1/95 1,340,263 0.7%
GE Capital Corp., 2.5%, 1997* 1/94 500,000 0.3%
Grand Metropolitan, 6.5%, 2000* 1/95 1,250,000 0.7%
Hysan Development, 6.75%, 2000* 5/95 500,000 0.3%
IVAX, 6.5%, 2001* 9/94 465,000 0.2%
Laidlaw (ADT), 6.0%, 1999* 12/93 - 4/94 2,347,500 1.3%
Microtel Franchise & Dev., 8.0%, 2004 1/94 1,500,000 1.2%
Microtel Franchise & Dev., 8.0%, 2005 1/95 1,500,000 1.2%
Nippon Denro Ispat, 3.0%, 2001* 3/94 500,000 0.2%
Owens-Corning Capital, $3.25 MIPS* 5/95 & 6/95 3,868,750 2.0%
Physicians Clinical Lab., 7.5%, 2000* 2/94 515,000 0.2%
Pier 1 Imports (General Host), 8.5%, 2000* 12/94 470,000 0.3%
Telekom Malaysia, 4.0%, 2004* 9/94 500,000 0.2%
TheraTx, 8.0%, 2002* 4/95 915,000 0.5%
Travel Ports of America, 8.5%, 2005* 2/95 1,500,000 0.8%
Zenith Electronics, 8.5%, 2001* 2/95 1,002,500 0.5%
-----
14.9%
=====
*SEC Rule 144A restriction.
Note 4. Bank Borrowings:
The Fund may borrow up to 5% of its total net assets from a bank to purchase
portfolio securities, or for temporary and emergency purposes. The Fund has
entered into an agreement which enables it to participate with other funds
managed by FMC, or an affiliate of FMC, in an unsecured line of credit with a
bank which permits borrowings up to $70 million, collectively. Interest is
charged to each fund, based on its borrowings, at a rate equal to the New York
Interbank Offer Rate (NIBOR) plus .75%. Borrowings are payable on demand.
The Fund had no borrowings outstanding at June 30, 1995. For the six month
period ended June 30, 1995, the average monthly loan balance was $72,558 at a
weighted average interest rate of 8.88%. The maximum amount of borrowings
outstanding at any month-end was $1,064,300.
16
<PAGE>
Note 5. Shares of Beneficial Interest:
The Agreement and Declaration of Trust permits the Fund to issue an unlimited
number of shares of beneficial interest of each class, par value $.01 per share.
Transactions in Fund shares were as follows:
Six Months Ended
June 30, 1995 Year Ended
(Unaudited) December 31, 1994
----------------------- ------------------------
Shares Amount Shares Amount
--------- ----------- ---------- -----------
Class A:
Shares sold 2,940,068 $38,195,707 5,704,417 $74,824,458
Shares issued on
reinvestment of
distributions 221,621 2,942,073 415,454 5,248,037
Shares issued in connection
with the acquisition of
Rochester Tax Managed
Fund, Inc. 660,637 9,039,351
Shares repurchased (859,297) (11,149,919) (1,008,951) (12,977,435)
--------- ----------- ---------- -----------
Net increase in
shares outstanding 2,963,029 $39,027,212 5,110,920 $67,095,060
========= =========== ========== ===========
-------------------------------------------------------------------------------
Period May 1 - June 30, 1995
(Unaudited)
----------------------------
Shares Amount
Class B: --------- ----------
Shares sold 447,365 $6,049,833
Shares issued on reinvestment
of distributions 753 10,328
Shares repurchased (402) (5,538)
------- ----------
Net increase
in shares outstanding 447,716 $6,054,623
======= ==========
-------------------------------------------------------------------------------
Period May 1 - June 30, 1995
(Unaudited)
----------------------------
Shares Amount
Class Y: ------- ----------
Shares sold 118,117 $1,579,966
Shares issued on reinvestment
of distributions 628 8,609
------- ----------
Net increase
in shares outstanding 118,745 $1,588,575
======= ==========
Note 6. Acquisition:
On June 28, 1995, the Fund acquired all of the assets and liabilities of
Rochester Tax Managed Fund, Inc. (RTMF). The acquisition was accomplished by a
tax-free exchange of 660,637 Class A shares of the Fund (valued at $9,039,351)
for the 760,094 shares of RTMF. The net assets of RTMF were valued at $9,039,351
and included unrealized appreciation of $4,275,694. RTMF did not distribute its
net investment income or realized gains and was taxed as an ordinary
corporation. Accordingly, an accrued tax liability of $1,255,916 was assumed by
the Fund on the date of the acquisition (see Note 1). The aggregate net assets
of the Fund after the acquisition were $189,184,982.
17
<PAGE>
<TABLE>
The Bond Fund For Growth
Financial Highlights
(For a share outstanding throughout each period)
<CAPTION>
Class A
------------------------------------------------------------------------
Six mos. ended Year ended December 31,
June 30, 1995 -------------------------------------------------------
(Unaudited) 1994 1993 1992+ 1991# 1990
-------------- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $12.20 $13.16 $11.43 $ 9.37 $ 7.88 $ 9.16
------ ------ ------ ------ ------ ------
Income from investment operations:
Net investment income 0.34 0.68 0.59 0.69 0.65 0.54
Net realized and unrealized gain
(loss) on investments 1.52 (0.81) 1.79 2.15 1.53 (1.26)
------ ------ ------ ------ ------ ------
Total from investment operations 1.86 (0.13) 2.38 2.84 2.18 (0.72)
------ ------ ------ ------ ------ ------
Less distributions to shareholders from:
Net investment income (0.33) (0.69) 0.65) (0.78) (0.69) (0.56)
Capital gains -- (0.14) -- -- -- --
------ ------ ------ ------ ------ ------
Total distributions (0.33) (0.83) (0.65) (0.78) (0.69) (0.56)
------ ------ ------ ------ ------ ------
Net asset value, end of period $13.73 $12.20 $13.16 $11.43 $ 9.37 $ 7.88
====== ====== ====== ====== ====== ======
Total return (excludes sales load) 30.71%* (1.12%) 21.23% 31.19% 28.50% (8.14%)
Ratios/supplemental data:
Net assets, end of period (000 omitted) $183,326 $126,691 $69,375 $10,241 $6,403 $6,035
Ratio of total expenses
to average net assets 1.60%* 1.66% 1.78% 1.93% 2.01% 2.92%
Ratio of total expenses (excluding
interest) to average net assets ++ 1.60%* 1.65% 1.75% 1.91% 1.94% 2.90%
Ratio of net investment income to
average net assets 5.32%* 5.24% 4.70% 6.62% 7.60% 6.37%
Portfolio turnover rate 46.60%* 52.82% 88.66% 80.09% 48.55% 33.23%
</TABLE>
--------------------------------------------------------------------------------
* Annualized.
+ Net of fees and expenses waived or reimbursed by Fielding Management
Company, Inc. which amounted to $0.01 per share. Without reimbursement, the
ratios would have been 2.06%, 2.04% and 6.50%, respectively.
# Net of fees and expenses waived or reimbursed by Fielding Management
Company, Inc. and Rochester Fund Services, Inc., which amounted to $0.07
per share. Without reimbursement, the ratios would have been 2.82%, 2.75%
and 6.79%, respectively.
++ During the periods shown above, the Fund's interest expense was
substantially offset by the incremental interest income generated on bonds
purchased with borrowed funds.
Per share information has been determined on the basis of the weighted number of
shares outstanding during the period.
18
<PAGE>
The Bond Fund For Growth
Financial Highlights
(For a share outstanding throughout each period)
Class B Class Y
------------- -------------
Period ended Period ended
June 30, 1995 June 30, 1995
(Unaudited) # (Unaudited) #
------------- -------------
Net asset value, beginning of period $13.11 $13.11
------ ------
Income from investment operations:
Net investment income 0.09 0.14
Net realized and unrealized gain
on investments 0.64 0.60
------ ------
Total from investment operations 0.73 0.74
------ ------
Less distributions to shareholders from:
Net investment income (0.09) (0.11)
------ ------
Total distributions (0.09) (0.11)
------ ------
Net asset value, end of period $13.75 13.74
====== ======
Total return (excludes sales load) 5.54%** 5.65%**
Ratios/supplemental data:
Net assets, end of period (000 omitted) $ 6,157 $ 1,631
Ratio of total expenses
to average net assets 1.62%* 1.14%*
Ratio of total expenses (excluding
interest) to average net assets + 1.62%* 1.14%*
Ratio of net investment income to
average net assets 4.71%* 6.14%*
Portfolio turnover rate 46.60%* 46.60%*
-------------------------------------------------------------------------------
* Annualized.
** Not annualized.
# For the period from May 1, 1995 (inception of offering) to June 30, 1995.
+ During the periods shown above, the Fund's interest expense was
substantially offset by the incremental interest income generated on bonds
purchased with borrowed funds.
Per share information has been determined on the basis of the weighted number of
shares outstanding during the period.
19
<PAGE>
The Bond Fund
For Growth
350 Linden Oaks
Rochester, New York 14625-2807
(716) 383-1300
Independent Accountants
Price Waterhouse, LLP
Rochester, New York
Investment Advisor
Fielding Management Company, Inc.
350 Linden Oaks
Rochester, New York 14625-2807
Distributor
Rochester Fund Distributors, Inc.
350 Linden Oaks
Rochester, New York 14625-2807
Custodian
Investors Bank and Trust Company
Boston, Massachusetts
Shareholder Services Agent
Rochester Fund Services, Inc.
350 Linden Oaks
Rochester, New York 14625-2807
(716) 383-1966
Trustees
Robert E. Brown, Elton J. Burgett,
Joseph A. Burnett, John Cannon,
Angelo A. Costanza, Ronald H. Fielding,
Dr. Marvin J. Hoffman, Michael S. Rosen,
and Eric W. Zaenglein.
