Officers and Directors
Charles J. Swindells--Chairman
A. John W. Campbell--Director
Edmund J. Cashman, Jr.--Director
Henri Deegenaar--Director
Walter A. Eberstadt--Director
Ian F. H. Grant--Director
Lawrence W. Harris, III--Director
Robert H. C. Van Maasdijk--Director
Wolfgang E. Furst Ysenburg--Director
Peter E. F. Newbald--President (WorldWide Value Fund logo)
William H. Miller, III--Vice President
Edward A. Taber, III--Vice President
Marie K. Karpinski--Vice President, Secretary
and Treasurer
Andrew Roberts--Assistant Vice President
James N. H. Bennett--Assistant Vice President
Brian J. Pierce--Assistant Vice President
Susan T. Lind--Assistant Secretary
Report to Shareholders
Custodian and Transfer Agent For the quarter ended
State Street Bank & Trust Company September 30, 1995
P.O. Box 1713 Lombard Odier International
Boston, Massachusetts 02105 Portfolio Management Limited
Investment Adviser
Sub-Custodian Legg Mason Fund Adviser, Inc.
The Chase Manhattan Bank, N.A. Investment Consultant
1 Chaseside and Administrator
Bournemouth, Dorset BH7 7DB
England
Worldwide Value Fund, Inc.
P.O. Box 1476
7 East Redwood Street, 10th floor
Baltimore, MD 21203-1476
<PAGE>
To Our Shareholders,
Worldwide Value Fund (VLU) recorded a 5.3% increase in its net
asset value during the third quarter of 1995, closing at $20.52 per
share at September 30 against $19.48 at June 30. Total return for the
year to date was 16.1%.
Net investment loss for the quarter was $37,000, or $(.012)
per share, against a loss of $18,000, or $(.006) per share, in the
like period a year earlier. Realized and unrealized gains for the same
period were $3,023,000, or $1.05 per share, in 1995, against
$1,618,000, or $0.54 per share, in 1994.
VLU's portfolio continues to be focused on Europe, with the United
Kingdom representing the largest holding at 32.5% of net assets,
followed by the Netherlands with 13.9%, Germany 12.7%, Switzerland
11.9% and France 9.9%. The remainder of the portfolio is comprised
mainly of other European securities.
Beginning on page 2, the Fund's portfolio managers discuss
political and economic conditions in Europe and their investment
strategies.
Sincerely,
(Signature of Charles J. Swindells)
Charles J. Swindells
Chairman of the Board
November 6, 1995
<PAGE>
Investment Advisers' Comments
During the third quarter of 1995 the European equity markets
continued their strong performance, though this was checked towards
the end of September by volatility in the currency markets.
Third Quarter 1995
MSCI European Index +3.6%
Worldwide Value Fund NAV +5.3%
In July, the markets were encouraged by a combination of interest
rate cuts in the US, monetary easing in Japan, and the decision by
the Bundesbank to inject liquidity into the markets by a
reduction in the minimum reserve requirements. The top performing
market was Finland which continued to be driven by strong moves in
Nokia, the mobile telephone supplier. Sweden was also strong due to
Ericsson which, like Nokia, operates in the high-tech sector.
Both Ericsson and Nokia continued to mirror the strong moves
seen in the US technology sector.
In August, first half results filtering through to the market
were a good illustration of the benefits of a weak currency. In
general the Swedish industrials returned excellent results and, with
the exception of the forestry sector, most stocks reacted positively.
In Spain, however, the reaction by investors to any good results was
slightly more subdued, and the general comment on most of the results
was that they were in line with optimistic analyst expectations.
Conversely, in the hard currency countries (including France),
results were much more disappointing, and those companies without
international production bases located overseas are obviously
suffering on pricing and margins. The oil sector in general was weak
on the back of worse than expected profit margins in the refining
industry and weak oil prices. On the currency front, a notable
development during August was the strength of the lira on the back of
rumors that it was soon to return to the Exchange Rate Mechanism
("ERM").
The month of September witnessed extreme volatility of the
dollar after much central bank intervention during the previous month.
In terms of themes in Europe, concerns about the inability to control
public deficits came back into play. Towards the middle of the
month, the German chancellor reminded the markets of the tough
Maastricht criteria for membership in the European Monetary Union and
suddenly there was a flight to quality, involving renewed strength in
the deutschmark and Swiss franc, and strong performance in the
Swiss equity market.
In the UK, the strong bid activity seen in the first half of
the year continued into the third quarter with bids totalling (pound)10
billion. Most of these bids were in cash which subsequently found
its way back into the equity market. Interest has largely centered
in three sectors--pharmaceuticals, financials and electricity, all
of which have large representation in the UKindex. On the political
front, Prime Minister Major shocked Parliament by resigning as leader
of the Conservatives. The move prompted endless debate and a degree of
political uncertainty for a week, but in the end his re-election had
the desired effect of silencing dissenters and regrouping the
Conservatives.
The political scene was particularly interesting in Southern Europe.
The Socialist Government in Spain lost the support of the Catalans as
allegations surrounding Gonzalez's involvement in the anti-terrorist
campaign intensified. In France, scandals surrounding Prime Minister Juppe
caused worries about his having to leave office, and aroused concerns over
the unpredictability of French fiscal policy. Generally investors were
2
<PAGE>
skeptical about the commitment of the new French government to reduce
the budget deficit. In Italy, the German Chancellor poured cold water
on the market, which had gradually become convinced of an imminent
entry into the ERM. His remarks were given credence by a relatively
weak budget proposal for 1996, and the lira and Italian bond market
collapsed.
Market Outlook
As we have mentioned, all the markets showed some weakness at
the end of the quarter, but in our view it is only a temporary
correction in sentiment. Our belief that this weakness will be
short-lived is supported by subdued economic activity in
Germany--there is still room for a further cut in German interest
rates. Inflation statistics from both West and East Germany were
surprisingly low, and in Spain, Italy and Sweden there is evidence that
inflation has resumed its downward trend.
Political uncertainty over the Spanish and Italian stockmarkets may
prevail from time to time, hopefully to be resolved in the event of
General Elections early next year. The main task for Spanish and
Italian politicians must be the passage of the 1996 budget law.
In terms of the positioning of the portfolio we have reduced our
weighting in France because of the uncertainty surrounding the new
administration's attitude toward fiscal and monetary policy.
Corporate Germany is obviously suffering, not only from
non-competitiveness, but also from margin squeezes partly caused by
domestic wage demands. We have moved funds from France, and to a
certain extent from Germany, in favour of the Dutch and Scandinavian
markets, where a majority of companies are significantly cheaper and
better managed. In the UKwe have assumed a slightly underweight
position in the market as we continue to be wary about the
Government's fiscal policy ahead of a General Election which is
expected to take place at the beginning of 1997. We have been severely
underweight the Spanish and Italian markets, and intend to remain so
until some favourable buying opportunities present themselves.
The geographical asset allocation has come about naturally from
specific stock selection based on corporate fundamentals and has
contributed to another quarter of good performance for the Worldwide
Value Fund. We are optimistic about the direction of interest rates,
and although there may be periods of currency volatility from time
to time, we believe that there are numerous European stocks that
can, and will, override any general negative investor sentiment.
Ronnie Armist
Mark Lloyd-Price
November 6, 1995
3
<PAGE>
===========================================================================
INDUSTRY DIVERSIFICATION
Worldwide Value Fund, Inc. / September 30, 1995
===========================================================================
<TABLE>
<CAPTION>
% of Net Market
Assets Value
(000)
<S> <C> <C>
Pharmaceuticals and Health Care 13.5% $ 8,193
Retail Sales 10.9 6,625
Oil and Gas 6.9 4,169
Chemicals 6.3 3,852
Multi-Industry 6.3 3,852
Banking 6.2 3,778
Manufacturing 5.5 3,338
Leisure 5.3 3,193
Insurance 4.8 2,926
Publishing 4.2 2,524
Automotive 3.7 2,264
Transportation 3.7 2,247
Utilities 3.6 2,187
Telecommunications 2.6 1,583
Miscellaneous Services 2.1 1,257
Machinery 2.0 1,216
Construction Materials 1.9 1,187
Paper and Forest Products 1.8 1,119
Consumer Non-Durable Goods 1.8 1,096
Electrical Equipment 1.8 1,073
Finance 1.6 995
Consumer Durable Goods 1.3 766
Investment Holding Companies 0.6 347
---- ------
Total Investment Portfolio 98.4 59,787
Other Assets Less Liabilities 1.6 970
----- -------
Net Assets 100.0% $60,757
===== =======
</TABLE>
4
<PAGE>
===========================================================================
PORTFOLIO OF INVESTMENTS / Unaudited
Worldwide Value Fund, Inc. / September 30, 1995 / Amounts in Thousands
===========================================================================
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS AND
EQUITY INTERESTS-98.1%
Australia-N.M.
Pirie Capital Limited 126 $ 16A
Pirie Capital Limited-Warrants 126 5A
- ---------------------------------------------------------------------------
21
- ---------------------------------------------------------------------------
Austria-0.9%
Flughafen Wien AG 9 547
- ---------------------------------------------------------------------------
Belgium-0.5%
Kredietbank NV 1 326
- ---------------------------------------------------------------------------
Denmark-0.5%
Novo-Nordisk AS-Class "B" 3 327
- ---------------------------------------------------------------------------
Finland-1.3%
Nokia AB 11 758
- ---------------------------------------------------------------------------
France-9.9%
Castorama Dubois Investissements 3 477
Christian Dior SA 6 578
Compagnie G<142>n<142>rale des Eaux 4 355
Cr<142>dit National 5 335
Ecco SA 4 695
Guilbert SA 5 518
Industrielle de Transports
Automobiles 3 466
Lyonnaise des Eaux 5 481
Michelin (CGDE)-Class B 8 344
Pinault-Printemps SA 2 424
Rhone-Poulenc 24 476
Roussel-Uclaf 3 411
Total Compagnie Francaise
des Petroles 7 430
- ---------------------------------------------------------------------------
5,990
- ---------------------------------------------------------------------------
Germany-12.7%
Allianz AG Holding N.M. 505
Altana Ag 1 717
Bayer AG 3 652
Bayerische Motoren Werke (BMW) N.M. 477
Deutsche Bank AG 11 505
Hoechst AG 2 547
Kaufhof Holding AG 3 974
Mannesmann AG 1 351
<CAPTION>
Shares Value
<S> <C> <C>
Germany-Continued
Schering AG 5 $ 341
Siemens AG 2 843
SKW Trostberg AG 21 467
Veba AG 25 988
Volkswagen AG 1 379
- ---------------------------------------------------------------------------
7,746
- ---------------------------------------------------------------------------
Italy-2.1%
Credito Italiano 218 258
Instituto Mobiliare Italiano 44 263
Riunione Adriatica di Sicurta S.p.A. 53 563A
Telecom Italia S.p.A. 107 178
- ---------------------------------------------------------------------------
1,262
- ---------------------------------------------------------------------------
Netherlands-13.9%
Aegon N.V. 20 735
Elsevier NV 56 715
Getronics NV 11 562
Hagemeyer N.V. 9 422
Internationale Nederlanden
Groep NV 17 995
KLMRoyal Dutch Airlines NV 17 607
Koninklijke Ahold NV 18 663
Koninklijke PTT Nederland NV 11 374
Oce-Van Der Grinten N.V. 7 415
Philips Electronics N.V. 22 1,073
RoyalDutchPetroleum Company 5 649
Ver. Ned. Uitgevbedri Verigd Bezit 5 639
Wegener NV 7 595
- ---------------------------------------------------------------------------
8,444
- ---------------------------------------------------------------------------
Norway-2.0%
A/S Veidekke 6 125
Orkla A.S.-Class "A" 14 679
Sensonor A.S. 39 384
- ---------------------------------------------------------------------------
1,188
- ---------------------------------------------------------------------------
Spain-2.6%
Autopistas Concesionaria
Espanola SA 64 624
Autopistas Concesionaria
Espanola SA-Rights 4 3
Banco Santander SA 7 314
Empresa Nacional
de Electricidad SA 12 615
- ---------------------------------------------------------------------------
1,556
- ---------------------------------------------------------------------------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
Sweden-7.1%
AGA AB-Series B 29 $ 381
Asea AB-Class B 3 328
Astra AB-Class A 28 1,013
Atlas Copco AB-Series B 52 865
Mo Och Domsjo AB (MODO) 8 497
Svedala Industrier AB 13 383
Telefonaktienbolaget LM Ericsson 33 825
- ---------------------------------------------------------------------------
4,292
- ---------------------------------------------------------------------------
Switzerland-11.9%
Alusuisse-Lonza Holding AG 1 393
BBC Brown Boveri AG 1 811
Ciba-Geigy AG 1 961
Clariant AG 1 368
Publicitas Holding S.A. 1 575A
Roche Holding AG N.M. 1,412
Sandoz AG 2 1,610
Swiss Reinsurance Group N.M. 450
Zurich Versicherungsgesellschaft 2 673
- ---------------------------------------------------------------------------
7,253
- ---------------------------------------------------------------------------
United Kingdom-32.5%
Allied Irish Banks plc 186 929
Asda Group plc 484 795
Barclays PLC 100 1,174
British Petroleum plc 266 1,987
British Sky Broadcasting Group plc 100 605
BTR plc 121 621
Compass Group plc 199 1,325
Etam plc 379 1,070
<CAPTION>
Shares Value
<S> <C> <C>
United Kingdom-Continued
Fairey Group plc 59 $ 477
Glaxo Wellcome plc 73 886
Granada Group plc 126 1,263
Henlys Group plc 168 1,408
Medeva plc 359 1,475
Next Plc 346 2,222
Smith (David S.) Holdings PLC 64 622
Smiths Industries plc 133 1,219
Wassall PLC 391 1,699
- ---------------------------------------------------------------------------
19,777
- ---------------------------------------------------------------------------
United States of America-0.2%
Britmar Corporation 46 115A
Progressions Health Systems, Inc. 2 1A
- ---------------------------------------------------------------------------
116
- ---------------------------------------------------------------------------
Total Common Stocks and
Equity Interests
(Identified Cost-$52,174) 59,603
- ---------------------------------------------------------------------------
PREFERRED STOCK-0.3%
Italy
Telecom Italia S.p.A.-Savings Shares
(Identified Cost-$186) 167 184
- ---------------------------------------------------------------------------
Total Investments-98.4%
(Identified Cost-$52,360) 59,787
Other Assets Less Liabilities-1.6% 970
- ---------------------------------------------------------------------------
NET ASSETS-100.0% $60,757
- ---------------------------------------------------------------------------
NET ASSET VALUE PER SHARE $20.52
- ---------------------------------------------------------------------------
</TABLE>
A Non-income producing
N.M. Not meaningful
6
<PAGE>
Dividend Reinvestment Plan
Worldwide Value Fund, Inc. offers an Automatic Dividend
Reinvestment Plan, whereby dividends and distributions are
automatically reinvested in additional shares of the Fund.
Shareholders who prefer to receive dividends and distributions in
cash should contact their investment broker if shares are held in
street name, or State Street Bank & Trust Company, P.O. Box
366, Boston, MA 02101 if shares are held in their own name.
Shareholder Account Information
Shareholders whose accounts are held in their own name may
contact the Fund's Transfer Agent, State Street Bank & Trust
Company at (800) 426-5523 for information concerning their
accounts.
Notice is hereby given in accordance with Section 23(c) of the
Investment Company Act of 1940 that the Fund may purchase, from
time to time, up to 150,000 of the outstanding shares of its
common stock at market prices.
7
