<PAGE> 1
SEMIANNUAL REPORT
JUNE 30, 1996
SAFECO RESOURCE SERIES TRUST
<PAGE> 2
June 30, 1996
- -----------------------------------------------------------------------------
INVESTMENT REVIEW
Report from Equity Portfolio Manager -- Richard Meagley
For the 1, 3 & 5-year periods ended June 30, 1996, the SAFECO RST -- Equity
Fund beat its peer group returning 25.73%, 20.84% and 18.93%, respectively.
According to Variable Annuity Research and Data Services, the average growth
and income fund returned 21.97%, 14.35% and 14.18% for the same periods.
The Fund's weightings in banking and finance stocks declined while
technology stocks grew during the quarter. Such shifts happen when the best
buys cluster in a particular area. In otherwords, the purchase and sale
decisions I make are based not on the attractiveness of an industry, but on
the quality of individual companies.
Banking and finance remains our top industry with 15.9% of net assets. We
sold Salomon, a securities broker, which had reached full value. We
increased our holdings in Chase Manhattan and bought a new position in
Federal Home Loan Mortgage Corp.
I added to technology by buying positions in Oracle and Seagate Technology.
Oracle is the world's largest maker of database management systems --
software that allows users to create, retrieve and manipulate data in
computer-based files. Seagate Technology manufactures and markets high-end
disk drives for workstations, minicomputers and mainframes.
This quarter I added SmithKline Beecham, a good quality stock with growth
potential, to the top 10 of the portfolio. The company researches, develops,
manufactures and markets prescription and over-the-counter pharmaceutical
and consumer products.
As always, I continue to manage RST-Equity for consistency and long-term
growth potential. The only real "bets" I make are made on high quality
companies.
- 2 -
<PAGE> 3
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
INVESTMENT HIGHLIGHTS
As of June 30, 1996
EQUITY PORTFOLIO
Illustration of a $10,000 investment:
Since Fund Inception on July 21, 1987 to June 30, 1996*
<TABLE>
<S> <C> <C> <C>
07/87 10,000 10,000
10,000 10,373
10,351 10,146
10,040 7,960
7,783 7,304
12/87 7,689 7,860
7,689 8,191
8,313 8,573
8,865 8,308
8,848 8,400
8,928 8,473
8,883 8,862
9,195 8,829
9,204 8,528
9,097 8,892
9,471 9,139
9,721 9,008
12/88 9,687 9,166
9,687 9,837
10,236 9,592
10,069 9,815
10,115 10,325
10,600 10,743
10,916 10,682
10,954 11,646
11,913 11,875
12,043 11,826
11,736 11,552
11,969 11,787
12/89 12,313 12,070
11,326 11,260
11,376 11,405
11,805 11,708
11,376 11,415
12,373 12,528
12,413 12,443
12,413 12,403
12,443 11,282
11,346 10,732
10,838 10,686
10,718 11,376
12/90 11,671 11,694
12,174 12,204
12,933 13,076
13,251 13,393
13,661 13,425
14,194 14,005
13,415 13,363
14,297 13,986
14,471 14,318
14,163 14,079
14,287 14,267
13,497 13,692
12/91 14,804 15,259
15,551 14,975
15,936 15,169
15,068 14,874
15,200 15,311
15,046 15,386
14,113 15,157
14,640 15,777
14,157 15,453
14,211 15,636
14,717 15,689
15,617 16,222
12/92 15,997 16,421
16,391 16,558
16,369 16,784
17,067 17,138
16,718 16,723
18,036 17,170
18,093 17,220
17,890 17,150
18,859 17,800
19,422 17,663
19,929 18,029
20,064 17,857
12/93 20,463 18,073
21,761 18,688
21,208 18,181
20,355 17,391
20,932 17,613
21,449 17,900
20,679 17,462
21,160 18,034
22,543 18,772
22,314 18,314
22,807 18,724
22,350 18,043
12/94 22,292 18,310
22,477 18,784
23,060 19,515
23,391 20,090
24,000 20,681
24,609 21,521
25,391 22,020
25,775 22,749
26,530 22,806
27,563 23,768
27,537 23,682
28,345 24,720
12/95 28,674 25,197
29,479 26,038
29,643 26,281
30,016 26,533
30,642 26,924
31,357 27,617
06/96 31,923 27,722
Equity Portfolio: $31,923 S&P 500 Index: $27,722
</TABLE>
Average Annual Total Return
<TABLE>
<CAPTION>
Since
1 Year 5 Year Inception*
- -------------------------------------------------------
<S> <C> <C> <C>
Equity Portfolio 25.73% 18.93% 13.90%
S&P 500 Index 25.98% 15.68% 12.14%
- -------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- -------------------------------------------------------
% of
Ten Largest Holdings Net Assets
- -------------------------------------------------------
<S> <C>
Chase Manhattan Corp. 5.0%
NationsBank Corp. 3.3
Philip Morris Cos., Inc. 3.1
Federal National Mortgage Association 3.0
SmithKline Beecham, plc 2.9
Viacom, Inc. 2.9
AT&T Corp. 2.7
ConAgra, Inc. 2.7
GTE Corp. 2.7
Mobil Corp. 2.6
</TABLE>
<TABLE>
<CAPTION>
Top Five Purchases (Jan. through June) Cost
- -------------------------------------------------------
<S> <C>
SmithKline Beecham, plc $5,881,225
Seagate Technology, Inc. 5,372,342
Echlin, Inc. 4,970,622
Browning-Ferris Industries, Inc. 4,780,331
Chase Manhattan Corp. 4,588,214
</TABLE>
Performance represents the performance of the Equity Portfolio, but
does not include deductions for administration charges, contingent deferred
sales charges, or mortality and expense risk premiums.
The performance of the Portfolio assumes the reinvestment of all dividends
and capital gains. The Standard & Poor's 500 Index is an unmanaged index of 500
stocks weighted by market capitalization with dividends reinvested. Management
fees and other portfolio expenses have been applied to the calculation of
Portfolio performance, but not to the index. If portfolio expenses had been
applied to the index, the index values would have been lower. Investment returns
are historical and not predictive of future performance. Portfolio share prices
and investment returns will fluctuate.
* The Portfolio's inception was July 21, 1987.
Performance information begins on July 31, 1987.
<TABLE>
<CAPTION>
Top Five Sales (Jan. through June) Proceeds
- -------------------------------------------------------
<S> <C>
Salomon, Inc. $5,845,943
Texaco, Inc. 4,296,733
American Brands, Inc. 3,743,627
Smart & Final, Inc. 3,463,218
Hartford Steam Boiler Inspection & Ins. Co. 3,167,914
</TABLE>
- 3 -
<PAGE> 4
June 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
EQUITY PORTFOLIO
<TABLE>
<CAPTION>
SHARES OR MARKET
PRINCIPAL VALUE
AMOUNT (000's)
<S> <C>
COMMON STOCKS - 92.2%
AUTO PARTS - 2.5%
140,500 Echlin, Inc. $ 5,321
BANKING & FINANCE - 10.0%
152,280 Chase Manhattan Corp. 10,755
44,700 Citicorp 3,693
87,000 NationsBank Corp. 7,188
BROADCAST MEDIA - 4.8%
158,000 *Viacom, Inc. (Class B) 6,142
66,500 Walt Disney Co. 4,181
CHEMICALS - 1.8%
50,000 Du Pont (EI) De Nemours & Co. 3,956
COMPUTER HARDWARE - 1.5%
32,000 Hewlett-Packard Co. 3,188
COMPUTER SOFTWARE - 4.1%
31,000 *Microsoft Corp. 3,724
126,800 Oracle Corp. 5,001
COMPUTER SYSTEMS - 2.0%
97,000 Seagate Technology, Inc. 4,365
DRUGS & HOSPITAL SUPPLIES - 8.2%
63,000 American Home Products Corp. 3,788
66,000 Schering-Plough Corp. 4,142
117,000 SmithKline Beecham, plc (ADR) 6,362
62,000 Warner-Lambert Co. 3,410
ELECTRICAL EQUIPMENT & ELECTRONICS - 5.8%
60,000 General Electric Co. 5,190
50,000 Intel Corp. 3,672
56,000 Motorola, Inc. 3,521
FINANCIAL SERVICES - 5.9%
32,000 Advanta Corp. 1,448
57,000 Federal Home Loan Mortgage Corp. 4,874
190,000 Federal National Mortgage Association 6,365
FOOD & TOBACCO - 5.8%
128,262 ConAgra, Inc. 5,820
63,700 Philip Morris Cos., Inc. 6,625
HOUSEHOLD PRODUCTS - 4.6%
56,700 Colgate-Palmolive Co. 4,805
65,600 Kimberly-Clark Corp. 5,068
INSURANCE - 5.9%
110,000 American General Corp. $ 4,001
45,000 American International Group, Inc. 4,438
78,000 ITT Hartford Group, Inc. 4,153
PAPER & FOREST PRODUCTS - 1.5%
54,000 Willamette Industries, Inc. 3,213
PETROLEUM & PETROLEUM SERVICES - 7.6%
61,000 Exxon Corp. 5,299
50,000 Mobil Corp. 5,606
36,000 Royal Dutch Petroleum Co. (ADR) 5,535
POLLUTION CONTROL - 2.1%
158,800 Browning-Ferris Industries, Inc. 4,605
RETAIL - 6.1%
108,800 Albertson's, Inc. 4,502
98,000 May Department Stores Co. 4,288
170,000 Wal-Mart Stores, Inc. 4,314
TELECOMMUNICATIONS - 2.7%
95,000 AT&T Corp. 5,890
TRANSPORTATION - 1.8%
55,500 Union Pacific Corp. 3,878
UTILITIES-ELECTRIC DISTRIBUTION - 2.4%
210,000 Houston Industries, Inc. 5,171
UTILITIES-TELEPHONE - 5.1%
161,000 Century Telephone Enterprises 5,132
128,900 GTE Corp. 5,768
---------
TOTAL COMMON STOCKS 198,397
---------
TEMPORARY INVESTMENTS - 7.7%
INVESTMENT COMPANIES:
10,779,125 Short-Term Investments Co.
(Prime Portfolio) 10,779
5,793,271 Short-Term Investments Co.
(Treasury Portfolio) 5,793
---------
TOTAL TEMPORARY INVESTMENTS 16,572
---------
TOTAL INVESTMENTS - 99.9% 214,969
Other Assets, less Liabilities 317
---------
NET ASSETS $215,286
=========
</TABLE>
* Non-income producing security.
See Notes to Financial Statements
- 4 -
<PAGE> 5
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
INVESTMENT REVIEW
Report from Growth Portfolio Manager -- Thomas M. Maguire
SAFECO RST - Growth continues to outperform its peers. For the 3-year period
ended June 30, 1996, the portfolio not only exceeded all growth funds, it
was first among all 478 equity funds monitored by Variable Annuity Research
and Data Services. Returning 38.82% for the 1-year period ended June 30,
1996, SAFECO RST -- Growth was 49 of 976 equity funds. From its inception,
January 7, 1993, through June 30, the portfolio's average annual return is
30.16%.
During the reporting period, I increased holdings in three stocks which have
great earnings growth potential and valuation: American Buildings, Lifeline
Systems and Fibreboard. American Buildings designs metal building structures
which are cheap to build and simple to install. Lifeline Systems provides
in-home monitoring services to elderly, disabled and medically at-risk
individuals. As the population ages, the market for this product is
increasing. Fibreboard continues to make acquisitions in the building
products area that add to, rather than dilute, its earning stream.
I've established a position in Family Golf Centers, which offers
professional management in the golf-related recreational facilities market,
which has traditionally been very fragmented. The growth potential for this
stock is strong. I added to our position in MICROS Systems, an electronic
cash register company with an outlook I like. I also added to Credit
Acceptance, a specialized financial services company providing funding and
collection services to automobile dealers.
Beginning in July, we have experienced a rough market. However, we continue
to hold a diverse mix of strong companies with good earnings growth
potential which should position us well for the long-term.
-5-
<PAGE> 6
June 30, 1996
- ---------------------------------------------------------------------------
INVESTMENT HIGHLIGHTS
As of June 30, 1996
GROWTH PORTFOLIO
Illustration of a $10,000 investment:
Since Fund Inception on January 7, 1993 to June 30, 1996*
<TABLE>
<S> <C> <C> <C>
01/93 10,000 10,000
9,475 10,136
10,059 10,350
9,683 10,100
10,535 10,369
10,891 10,400
11,297 10,358
12,198 10,750
12,822 10,667
13,386 10,888
12,792 10,785
12/93 13,473 10,915
14,382 11,286
13,861 10,980
13,351 10,503
13,750 10,637
14,094 10,811
13,662 10,546
14,216 10,892
14,714 11,337
14,626 11,060
15,169 11,308
14,936 10,897
12/94 15,079 11,058
15,148 11,344
15,694 11,786
15,671 12,133
15,973 12,490
16,670 12,997
17,727 13,299
18,506 13,739
18,587 13,773
19,644 14,354
19,818 14,303
20,666 14,929
12/95 21,261 15,217
21,476 15,725
22,051 15,872
22,654 16,024
24,060 16,260
25,519 16,679
06/96 24,608 16,742
Growth Portfolio: $24,608 S&P 500 Index: $16,742
</TABLE>
Average Annual Total Return
<TABLE>
<CAPTION>
Since
1 Year Inception*
- -----------------------------------------------------
<S> <C> <C>
Growth Portfolio 38.82% 30.16%
S&P 500 Index 25.98% 16.37%
- -----------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
% of
Ten Largest Holdings Net Assets
- -----------------------------------------------------
<S> <C>
Seagate Technology, Inc. 4.9%
MICROS Systems, Inc. 4.8
Datascope Corp. 4.5
Credit Acceptance Corp. 4.2
Family Golf Centers, Inc. 4.1
Canandaigua Wine Co. 4.1
Philip Morris Cos., Inc. 4.1
American Buildings Co. 4.1
Health Systems International, Inc. 3.8
Lifeline Systems, Inc. 3.7
</TABLE>
<TABLE>
<CAPTION>
Top Five Purchases (Jan. through June) Cost
- -----------------------------------------------------
<S> <C>
Datascope Corp. $3,925,140
MICROS Systems, Inc. 3,208,219
Credit Acceptance Corp. 2,710,677
Lifeline Systems, Inc. 2,472,502
American Buildings Co. 2,318,446
</TABLE>
Performance represents the performance of the Growth Portfolio but does not
include administration charges, contingent deferred sales charges, or mortality
and expense risk premiums.
The performance of the Portfolio assumes the reinvestment of all dividends
and capital gains. The Standard & Poor's 500 Index is an unmanaged index of 500
stocks weighted by market capitalization with dividends reinvested. Investment
management fees have been applied to the calculation of Portfolio performance,
but not to the index. If portfolio investment management fees had been applied
to the index, the index values would have been lower.
Investment returns are historical and not predictive of future performance.
Portfolio share prices and investment returns will fluctuate.
* The Portfolio's inception was January 7, 1993.
Performance information begins on January 31, 1993.
<TABLE>
<CAPTION>
Top Five Sales (Jan. through June) Proceeds
- -----------------------------------------------------
<S> <C>
Central Parking Corp. $3,399,928
Youth Services International, Inc. 2,098,023
Intel Corp. 2,014,869
Nikia Corp. ADR (Class A) 1,777,541
U.S. Health Care, Inc. 1,765,625
</TABLE>
- 6 -
<PAGE> 7
(Unaudited) SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
GROWTH PORTFOLIO
<TABLE>
<CAPTION>
SHARES OR MARKET
PRINCIPAL VALUE
AMOUNT (000's)
<S> <C>
COMMON STOCKS - 99.3%
ADVERTISING - 2.8%
80,000 *HA-LO Industries, Inc. $ 2,080
AUTOS - 0.2%
14,000 *Ugly Duckling Corp. 129
AUTOS & AUTO PARTS - 0.6%
16,600 *Miller Industries, Inc. 475
BEVERAGES - 0.6%
185,000 *Brio Industries, Inc. 439
BEVERAGES - ALCOHOLIC - 4.1%
100,000 *Canandaigua Wine Co. 3,000
BUILDING MATERIALS - 3.3%
31,600 *ABT Building Products Corp. 711
61,700 *Fibreboard Corp. 1,704
CHEMICALS - 0.5%
39,000 *Melamine Chemicals, Inc. 356
COMMERCIAL SERVICES - 3.7%
72,200 Aaron Rents, Inc. 912
7,700 *AMRE, Inc. 168
45,000 *Right Management Consultants 1,643
COMPUTER SOFTWARE - 2.2%
44,600 *Ciber, Inc. 981
21,000 *LanVision Systems, Inc. 273
14,700 *SPSS, Inc. 368
COMPUTER SYSTEMS - 9.7%
127,300 *MICROS Systems, Inc. 3,548
80,000 *Seagate Technology, Inc. 3,600
CONSTRUCTION & ENGINEERING - 4.1%
101,900 *American Buildings Co. 2,981
DRUGS - 0.2%
13,100 *Zonagen, Inc. 113
DRUGS & HOSPITAL SUPPLIES - 10.7%
20,000 *Andrx Corp. 303
20,000 *Autonomous Technologies Corp. 118
186,100 *Datascope Corp. 3,303
200,000 *Lifeline Systems, Inc. 2,675
97,000 Medex, Inc. 1,249
12,000 *ResMed, Inc. 186
ELECTRICAL EQUIPMENT & ELECTRONICS - 0.7%
61,200 *JPM Co. $513
ELECTRONICS - 2.6%
17,500 *Intermagnetics General Corp. 315
94,000 *Ultrak, Inc. 1,610
ENTERTAINMENT - 1.0%
75,000 *West Coast Entertainment Corp. 741
FINANCE - MISC. - 2.2%
54,400 Cole Taylor Financial Group, Inc. 1,618
FINANCIAL - 2.8%
101,400 First Financial Caribbean Corp. (ADR) 2,079
FINANCIAL SERVICES - 4.4%
146,200 *Credit Acceptance Corp. 3,070
40,000 *FirstService Corp. 135
FOOD & TOBACCO - 4.5%
28,800 Philip Morris Cos., Inc. 2,995
27,000 Thorn Apple Valley, Inc. 297
HEALTH CARE - 3.8%
102,600 *Health Systems International, Inc 2,783
HOMEBUILDING - 0.5%
24,000 *Diamond Home Services, Inc. 402
HOSPITAL MANAGEMENT - 3.4%
115,000 *American Healthcorp, Inc. 1,438
29,400 *Foundation Health Corp. 1,055
HOUSEHOLD PRODUCTS - 5.2%
18,798 Kimberly-Clark Corp. 1,452
136,200 *Lifetime Hoan Corp. 1,464
41,000 *Paragon Trade Brands, Inc. 882
LEISURE TIME - 7.2%
120,000 *Family Golf Centers, Inc. 3,015
20,000 *Laser Storm, Inc. 85
38,000 *Mikohn Gaming Corp. 337
41,700 *Morrow Snowboards, Inc. 438
41,150 Polaris Industries, Inc. 1,404
MANUFACTURING - 2.1%
14,400 *Industrial Training Corp. 113
33,505 Mark IV Industries, Inc. 758
56,800 *Maverick Tube Corp. 667
</TABLE>
See Notes to Financial Statements
- 7 -
<PAGE> 8
June 30, 1996 (Unaudited)
- -----------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
GROWTH PORTFOLIO
<TABLE>
<CAPTION>
SHARES OR MARKET
PRINCIPAL VALUE
AMOUNT (000's)
- ---------------------------------------------------------------
<S> <C>
Office Equipment & Supplies - 1.4%
83,200 * Open Plan Systems, Inc. $998
Pollution Control - 1.1%
44,000 * Tetra Technologies, Inc. 770
Restaurants - 2.0%
144,300 * NPC International, Inc. 1,461
Retail - 2.3%
109,643 * Harold's Stores, Inc. 1,686
Retail - Specialty - 5.5%
116,100 * American Coin Merchandising, Inc. 639
8,000 * Artistic Greetings, Inc. 27
73,800 First Years, Inc. 1,015
60,800 * Garden Botanika, Inc. 1,338
10,800 * Marks Brothers Jewelers, Inc. 246
58,500 * Rent-Way, Inc. 797
Telecommunications - 0.8%
21,900 * EIS International, Inc. 558
Transportation - Air - 3.1%
50,000 Pittston Brink's Group $1,456
36,500 Pittston Burlington Group 789
-------
TOTAL COMMON STOCKS 72,761
-------
TEMPORARY INVESTMENTS - 0.2%
Investment Companies:
126,340 Short-Term Investments Co.
(Prime Portfolio) 126
-------
TOTAL TEMPORARY INVESTMENTS 126
-------
TOTAL INVESTMENTS - 99.5% 72,887
Other Assets, less Liabilities 356
-------
NET ASSETS $73,243
=======
</TABLE>
* Non-income producing security.
See Notes to Financial Statements
- 8 -
<PAGE> 9
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
INVESTMENT REVIEW
Report from Northwest Portfolio Manager -- Charles R. Driggs
For the six months ended June 30, the portfolio's total return was 10.14%
compared to 12.78% for the Murphy Favre Northwest 50 Index.
Slow starts for a few of the initial public offerings we added in 1995, some
individual poor performances and a 16% cash position in a market where cash
underperformed, held our returns under the six-month Northwest 50 return.
Having experienced the ups and downs of establishing positions in the
newly-offered stock of Redhook Ale (a craft brewer distributed by Anheuser
Busch), Hart Brewing (ales and lagers that seem destined for national
distribution), ThrustMaster (flight simulators, control systems and joy
sticks), Semitool (silicon wafer washer), R-B Rubber (recycles used tires
into rubber surfaces) and Emeritus (assisted-living), I have given them time
to grow over the last six months.
In fact, Emeritus has grown into one of our top ten holdings. Boeing, US
Bancorp, Price/Costco, Microsoft, Longview Fibre and Egghead are also among
this portfolio's largest holdings.
Banks and savings & loans comprise about 17.2% of the portfolio. Banks have
done very well for the last two years and seemed poised to continue to do
so: The industry is continuing to consolidate and I think there is great
money to be made here.
Price/Costco's domestic comparable sales figures continue to improve and the
company continues to open stores in Asia and Europe. Longview Fibre's stock
price, is staged to come back as Japanese timber orders are expected to
increase. Egghead Software has moved its headquarters to Spokane in an
effort to trim expenses.
Meanwhile, at Boeing, the 777 conversion is complete, a popular new
president and labor agreements are in place and the next cycle of domestic
airplane orders is staged to begin.
Microsoft is growing strong due to its ability to capitalize on computing
trends -- most recently, the internet.
Through our holdings in Assisted Living Concepts of Salem, Oregon and
Emeritus of Seattle, we also have a substantial stake in the elder care
business, which is expected to grow 25% to 35% per year through 2010. We're
building new positions in Epitope, whose oral AIDs testing kit that will be
marketed by SmithKline, and in Garden Botanika, a personal products retailer
with 161 company-owned stores in 31 states.
SAFECO Northwest Portfolio is currently geared toward a strong local
economy. The rebound at Boeing and continued strong growth in the "Silicon
Forest" will benefit the service providers that populate our portfolio.
-9-
<PAGE> 10
June 30, 1996
- ---------------------------------------------------------------------------
INVESTMENT HIGHLIGHTS
As of June 30, 1996
NORTHWEST PORTFOLIO
Illustration of a $10,000 investment:
Since Fund Inception on January 7, 1993 to June 30, 1996*
<TABLE>
<S> <C> <C> <C> <C> <C>
01/93 10,000 10,000 10,000
9,385 10,136 9,687
9,633 10,350 10,086
9,325 10,100 9,859
9,563 10,369 10,103
9,474 10,400 9,885
9,425 10,358 9,531
9,623 10,750 9,921
9,722 10,667 9,698
9,841 10,888 10,046
9,901 10,785 10,262
12/93 9,945 10,915 10,400
10,146 11,286 10,714
10,496 10,980 10,873
10,216 10,503 10,490
10,166 10,637 10,458
10,055 10,811 10,616
9,915 10,546 10,293
10,086 10,892 10,374
10,526 11,337 10,972
10,536 11,060 10,553
10,646 11,308 10,490
10,396 10,897 10,302
12/94 10,309 11,058 10,359
10,097 11,344 10,314
10,258 11,786 10,611
10,661 12,133 10,999
10,681 12,490 11,330
10,812 12,997 11,331
11,356 13,299 12,019
12,040 13,739 12,474
12,292 13,773 12,712
12,070 14,354 13,179
11,778 14,303 12,874
11,517 14,929 13,066
12/95 11,074 15,217 13,226
11,043 15,725 13,663
11,349 15,872 13,978
11,972 16,024 13,904
12,268 16,260 14,739
12,452 16,679 14,978
06/96 12,196 16,742 14,915
Northwest Portfolio: $12,196 S&P 500 Index: $16,742 Northwest 50 Index: $14,915
</TABLE>
Average Annual Total Return
<TABLE>
<CAPTION>
Since
1 Year Inception*
- -----------------------------------------------------
<S> <C> <C>
Northwest Portfolio 7.40% 5.98%
Northwest 50 Index 24.10% 12.48%
S&P 500 Index 25.98% 16.37%
- -----------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
% of
Ten Largest Holdings Net Assets
- -----------------------------------------------------
<S> <C>
Boeing Co. 4.7%
US Bancorp 4.7
Schnitzer Steel Industries, Inc. 4.6
Microsoft Corp. 4.2
Washington Mutual Savings Bank 3.9
Price/Costco, Inc. 3.5
Emeritus Corp. 3.4
Longview Fibre Co. 2.9
Monaco Coach Corp. 2.7
Egghead, Inc. 2.4
</TABLE>
<TABLE>
<CAPTION>
Top Five Purchases (Jan. through June) Cost
- -----------------------------------------------------
<S> <C>
Boeing Co. $451,878
Schnitzer Steel Industries, Inc. 247,894
NIKE, Inc. 207,000
Washington Mutual Savings Bank 183,763
Microsoft Corp. 174,375
</TABLE>
Performance represents the performance of the Northwest Portfolio, but
does not include deductions for administration charges, contingent deferred
sales charges, or mortality and expense risk premiums.
The performance of the Portfolio assumes the reinvestment of all
dividends and capital gains. The Standard & Poor's 500 Index is an unmanaged
index of 500 stocks weighted by market capitalization with dividends
reinvested. The Murphey Favre Northwest 50 Index is an index of 50 Northwest
companies weighted by their regional impact. Investment management fees have
been applied to the calculation of Portfolio performance, but not to the
indexes. If portfolio investment management fees had been applied to the
indexes, the index values would have been lower. Investment returns are
historical and not predictive of future performance. Portfolio share prices
and investment returns will fluctuate.
* The Portfolio's inception was January 7, 1993.
Performance information begins on January 31, 1993.
<TABLE>
<CAPTION>
Top Five Sales (Jan. through June)* Proceeds
- -----------------------------------------------------
<S> <C>
NIKE, Inc. $291,275
Univar Corp. 228,772
Paragon Trade Brands, Inc. 132,638
Mentor Graphics Corp. 113,850
Boeing Co. 109,637
</TABLE>
- 10 -
<PAGE> 11
(Unaudited) SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
NORTHWEST PORTFOLIO
<TABLE>
<CAPTION>
SHARES OR MARKET
PRINCIPAL VALUE
AMOUNT (000's)
- ---------------------------------------------------------------------
<S> <C>
COMMON STOCKS - 82.7%
Aerospace - 4.7%
4,400 Boeing Co. $ 383
Apparel Manufacturing - 2.0%
1,600 NIKE, Inc. 164
Autos - 2.7%
17,500 * Monaco Coach Corp. 219
Banks - 10.0%
3,450 * Cascade Bancorp 70
6,000 Interwest Bancorp, Inc. 143
10,680 Northrim Bank 100
10,510 US Bancorp 380
5,820 West Coast Bancorp, Inc. 111
Beverages - 2.9%
13,800 * Hart Brewing, Inc. 141
4,100 * Redhook Ale Brewery, Inc. 95
Building Materials - 2.5%
4,900 * BMC West Corp. 84
6,400 TJ International, Inc. 115
Chemicals - 1.0%
20,000 * Consep, Inc. 78
Commercial Services - 1.6%
6,900 * Barrett Business Services, Inc. 129
Computer Software - 5.6%
4,700 * Analogy, Inc. 34
4,300 * Mentor Graphics Corp. 70
2,800 * Microsoft Corp. 336
2,600 * Thrustmaster, Inc. 11
Drugs & Hospital Supply - 1.0%
5,100 * Epitope, Inc. 80
Electrical Equipment & Electronics - 5.6%
13,800 * FLIR Systems, Inc. 169
7,100 * Lattice Semiconductor Corp. 171
2,300 * Merix Corp. 46
3,300 * Praegitzer Industries, Inc. 36
2,450 * Semitool, Inc. 32
Food - 1.9%
20,000 * Wholesome & Hearty Foods, Inc. 155
Health Care - 4.8%
4,600 * Assisted Living Concepts, Inc. $ 94
15,600 * Emeritus Corp. 275
5,000 * ProCyte Corp. 18
Household Products - 1.6%
6,100 * Paragon Trade Brands, Inc. 131
Machinery - Diversified - 1.2%
11,900 * Flow International Corp. 95
Metals - Miscellaneous - 5.3%
3,900 Oregon Steel Mills, Inc. 54
13,900 Schnitzer Steel Industries, Inc. 372
Paper & Forest Products - 2.9%
13,900 Longview Fibre Co. 236
Pollution Control - 0.4%
12,600 * R-B Rubber Products, Inc. 32
Retail-Grocers - 3.6%
4,000 Albertson's, Inc. 166
10,000 * Carr-Gottstein Foods Co. 43
3,147 * Quality Food Centers, Inc. 81
Retail-Other - 7.6%
9,800 * Hollywood Entertainment Corp. 152
4,000 Nordstrom, Inc. 178
13,100 * Price/Costco, Inc. 283
Retail-Specialty - 3.9%
17,200 * Egghead, Inc. 191
5,500 * Garden Botanika, Inc. 121
Savings & Loans/Savings Banks - 7.2%
3,700 Security Bancorp 78
12,600 * Sterling Financial Corp. 186
10,600 Washington Mutual Savings Bank 317
Transportation - 2.7%
2,400 Airborne Freight Corp. 62
26,500 * Arrow Transportation Co. 30
2,900 Expeditors International of Washington, Inc. 90
2,100 Greenbrier Companies, Inc. 29
-----
TOTAL COMMON STOCKS 6,666
-----
</TABLE>
See Notes to Financial Statements
- 11 -
<PAGE> 12
June 30, 1996 (Unaudited)
- -----------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
NORTHWEST PORTFOLIO
<TABLE>
<CAPTION>
SHARES OR MARKET
PRINCIPAL VALUE
AMOUNT (000's)
- ---------------------------------------------------------------
<S> <C>
TEMPORARY INVESTMENTS - 16.0%
INVESTMENT COMPANIES:
396,360 Short-Term Investments Co.
(Prime Portfolio) $ 396
3,673 Short-Term Investments Co.
(Treasury Portfolio) 4
U.S. AGENCY NOTES:
$600,000 Federal Home Loan Mortgage
5.32% due 9/27/96 592
300,000 Federal National Mortgage Association
5.27% due 7/30/96 299
------
TOTAL TEMPORARY INVESTMENTS 1,291
------
TOTAL INVESTMENTS - 98.7% $7,957
Other Assets, less Liabilities 108
------
NET ASSETS $8,065
======
</TABLE>
* Non-income producing security.
See Notes to Financial Statements
- 12 -
<PAGE> 13
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
INVESTMENT REVIEW
Report from Bond Portfolio Manager -- Michael C. Knebel
The SAFECO RST -- Bond portfolio returned -2.30% for the six months and 4.88%
for the year ended June 30, 1996. The Lehman government/corporate index
returned -1.88% for the six months and 4.66% for the 12-month period.
1996 is proving difficult for bond investors, as yields on intermediate-term
treasuries moved higher through the first and second quarters. Increased
treasury borrowing accounted for some of the upward movement in yields, but
fear of a resurgence of inflation is the main culprit behind the current
bearish sentiment.
When rates began moving higher in February, the portfolio took a blow from
which our six month performance still suffers. However, the conservative
risk profile we decided to adopt in March clearly benefited the portfolio.
Because our average maturity is significantly shorter than that of the
market, we outperformed over the last three months, and finished ahead of
the index for the past 12 months.
We sold a combination of 3-month and 7-year treasuries and bought 3-year
treasury strips, also known as zero-coupon bonds. They are called strips,
because the interest payment is stripped away, leaving the holder only the
right to collect the principal value at maturity. Strips are sold at deep
discounts because they provide no income stream and they tend to appreciate
faster than traditional securities when the bond market rallies and decline
faster when the market falls. Buying the strips, we improved the yield to
maturity.
Another change to the portfolio during the reporting period included
investing in a new asset class. We added a new AAA-rated asset-backed
security issued by Chevy Chase Auto Trust, which offers a generous yield
spread (difference in yield of securities with different credit qualities)
over treasuries despite its high quality rating.
The SAFECO RST -- bond portfolio has 66% of net assets invested in U.S.
Treasuries, 1% of net assets in cash and the remainder invested as follows:
bank/finance 9%, electric utilities 8%, finance-auto 4%, entertainment 3%,
asset-backed securities 2%, Canadian Provinces 2%, oils 2%, retail 2%,
phones 1%.
On June 30, the portfolio's average maturity was 2.5 years compared to
9.4 years for the Lehman Government/Corporate index. Its adjusted duration
(sensitivity to interest rates) was 2.13 compared to 5.04 for the index.
Looking ahead, we expect economic growth to moderate in the coming months
and inflation to remain under control, despite some recent evidence that
wage-cost pressures are emerging. We think productivity gains will offset
some of the wage increases and that the remaining costs will likely be
absorbed in lower profit margins, rather than passed on to the consumer.
Interest rates will likely move higher in the short run, as the Federal
Reserve ratchets up short-term rates as a precaution against runaway
inflation. Given that, we will maintain our defensive posture, until rates
return to their early-Spring levels.
-13-
<PAGE> 14
June 30, 1996
- --------------------------------------------------------------------------------
INVESTMENT HIGHLIGHTS
As of June 30, 1996
BOND PORTFOLIO
Illustration of a $10,000 investment:
Since Fund Inception on July 21, 1987 to June 30, 1996*
<TABLE>
<S> <C> <C> <C>
07/87 10,000 10,000
10,000 9,944
10,010 9,730
9,861 10,095
10,070 10,159
12/87 10,290 10,298
10,290 10,651
10,508 10,774
10,633 10,667
10,602 10,605
10,591 10,534
10,519 10,772
10,675 10,711
10,643 10,738
10,643 10,974
10,820 11,168
10,986 11,042
12/88 11,013 11,079
11,013 11,227
11,103 11,141
11,058 11,200
11,081 11,438
11,294 11,719
11,540 12,101
11,775 12,353
12,022 12,161
11,887 12,215
12,134 12,524
12,223 12,637
12/89 12,258 12,656
12,173 12,482
12,222 12,510
12,258 12,511
12,197 12,396
12,450 12,755
12,595 12,962
12,595 13,123
12,751 12,932
12,703 13,040
12,727 13,213
12,836 13,501
12/90 13,063 13,705
13,154 13,859
13,270 13,978
13,361 14,074
13,516 14,236
13,620 14,303
13,581 14,287
13,749 14,467
14,008 14,800
14,215 15,109
14,383 15,244
14,513 15,396
12/91 14,890 15,915
14,793 15,680
14,793 15,763
14,697 15,676
14,807 15,770
15,055 16,076
15,276 16,312
15,634 16,730
15,744 16,879
16,062 17,108
15,744 16,847
15,648 16,831
12/92 15,906 17,121
16,259 17,494
16,611 17,858
16,700 17,919
16,832 18,057
16,803 18,048
17,111 18,457
17,185 18,576
17,582 19,003
17,685 19,069
17,773 19,147
17,493 18,931
12/93 17,583 19,014
17,836 19,300
17,393 18,879
17,030 18,416
16,919 18,263
16,919 18,231
16,903 18,189
17,109 18,552
17,172 18,560
17,014 18,280
17,014 18,260
16,998 18,227
12/94 17,068 18,347
17,302 18,699
17,586 19,133
17,687 19,261
17,921 19,529
18,590 20,347
18,741 20,510
18,607 20,430
18,858 20,692
19,059 20,903
19,377 21,210
19,762 21,560
12/95 20,118 21,877
20,171 22,012
19,691 21,546
19,495 21,365
19,478 21,217
19,513 21,181
06/96 19,656 21,465
Bond Portfolio:$19,656 Lehman Gov't/Corp.: $21,465
</TABLE>
Average Annual Total Return
<TABLE>
<CAPTION>
Since
1 Year 5 Year Inception*
- ---------------------------------------------------------------
<S> <C> <C> <C>
Bond Portfolio 4.88% 7.67% 7.87%
Lehman Gov't/Corp. Index 4.66% 8.48% 8.96%
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
% of
Ten Largest Holdings Net Assets
- ---------------------------------------------------------------
<S> <C>
U.S. Treasury Principal Strip, due 8/15/99 14.0%
U.S. Treasury Note, 6.25%, due 2/15/03 9.5
Ford Motor Credit Co. 3.9
Society Bank - Cleveland 3.3
Walt Disney Co. 3.2
Pacific Gas & Electric Co. 3.2
U.S. Treasury Note, 7.50%, due 2/15/05 2.8
Dayton Hudson Corp. 1.8
Associates Corp. of North America 1.7
Manitoba (Province) 1.7
Weighted Average Maturity 2.5 Years
</TABLE>
Performance represents the performance of the Bond Portfolio, but does not
include deductions for administration charges, contingent deferred sales
charges, or mortality and expense risk premiums.
The performance of the Portfolio assumes the reinvestment of all dividends
and capital gains. The Lehman Gov't/Corp. Index is a representative total return
benchmark for the Portfolio. Investment management fees have been applied to the
calculation of Portfolio performance, but not to the index. If portfolio
investment management fees had been applied to the index, the index values would
have been lower. Investment returns are historical and not predictive of future
performance. Portfolio share prices and investment returns will fluctuate.
* The Portfolio's inception was July 21, 1987.
Performance information begins on July 31, 1987.
Portfolio Credit Quality
<TABLE>
<CAPTION>
MOODY'S S&P MOODY'S S&P
- ---------------------------------------------------------------
<S> <C> C> <C>
U.S. Gov't U.S. Gov't 65.7% 65.7%
Aaa AAA 1.7 1.7
Aa AA 5.0 1.7
A A 23.8 25.7
Baa BBB 1.8 3.2
Temporary Investments 0.6 0.6
Other Assets less Liabilities 1.4 1.4
--------------------------
Total 100.0% 100.0%
==========================
</TABLE>
- 14 -
<PAGE> 15
(Unaudited) SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
BOND PORTFOLIO
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
(000's) (000's)
<S> <C>
ASSET BACKED SECURITY - 1.7%
Financial - 1.7%
$250 Chevy Chase Auto ABS
6.60%, due 12/15/02 $ 251
-------
TOTAL ASSET BACKED SECURITY 251
-------
CORPORATE BONDS - 30.6%
Banking & Finance - 9.1%
250 Associates Corp. of North America
8.80%, due 8/01/98 261
135 BankAmerica Corp.
9.50%, due 4/01/01 149
200 Grand Metropolitan Investment Corp.
8.625%, due 8/15/01 214
250 Household Finance Corp.
7.625%, due 6/15/99 256
500 Society Bank - Cleveland
7.125%, due 4/15/97 504
Canadian Provinces, U.S. Funds - 1.7%
250 Manitoba (Province)
7.75%, due 2/01/02 260
Entertainment - 3.2%
500 Walt Disney Co.
6.375%, due 3/30/01 490
Finance-Auto - 3.9%
600 Ford Motor Credit Co.
6.25%, due 8/11/00 586
Oil & Gas - 1.7%
250 Texaco Capital, Inc.
6.875%, due 7/15/99 252
Retail - 1.8%
250 Dayton Hudson Corp.
9.40%, due 2/15/01 273
Utilities-Electric - 7.8%
$250 Delmarva Power & Light Co.
7.50%, due 5/01/99 $ 255
500 Pacific Gas & Electric Co.
5.375%, due 8/01/98 489
250 Public Services Electric & Gas Co.
6.00%, due 1/01/98 248
200 Virginia Electric & Power Co.
6.25%, due 8/01/98 199
Utilities-Telephone - 1.4%
200 GTE Corp.
8.85%, due 3/01/98 207
-------
TOTAL CORPORATE BONDS 4,643
-------
U.S. GOVERNMENT SECURITIES - 65.7%
U.S. Treasury Notes - 51.7%
400 7.50%, due 2/15/05 421
5,965 6.50%, due 9/30/96 5,984
1,465 6.25%, due 2/15/03 1,438
U.S. Treasury Principal Strips - 14.0%
2,575 0.00%, due 8/15/99 2,115
-------
TOTAL U.S. GOVERNMENT SECURITIES 9,958
-------
TEMPORARY INVESTMENTS - 0.6%
85,575 Short-Term Investment Co.
(Prime Portfolio) 86
-------
TOTAL TEMPORARY INVESTMENTS 86
-------
TOTAL INVESTMENTS - 98.6% 14,938
Other Assets, less Liabilities 218
-------
NET ASSETS $15,156
=======
</TABLE>
See Notes to Financial Statements
- 15 -
<PAGE> 16
June 30, 1996
- ------------------------------------------------------------------------------
INVESTMENT REVIEW
Report from Money Market Portfolio Manager -- Naomi Urata
In the six-months ended June 30, 90-day commercial paper rates fell from
5.50% in January to a low of 5.12% in February, and then rose to 5.52% at
the end of June.
The period has been characterized by changes in the yield curve (a graph
representing the difference in yields of similar securities at different
maturities.) It began with an inverted yield curve; overnight instruments
were paying more than securities out to one year. The curve remained
inverted until May when it flattened. It returned to its usual, upward slope
in June as investors began to anticipate a possible tightening of interest
rates by the Federal Reserve.
Expectations about economic activity drove the changing level and shape of
the yield curve. The yield curve was inverted at the beginning of the year
because investors believed that rates would come down. Now rates are rising
due to investor beliefs that the economy is growing at a fast pace which
might cause higher inflation. It is hoped that rising rates will slow the
economy somewhat and prevent prices from rising too fast.
The average maturity of the Portfolio rose from 32 to 53 days in the early
part of the year then fell back to 38 days by the end of June. I invested in
U.S. Agency Securities and commercial paper issued by top tier corporations.
All of the securities were less than 13-months maturity and bear a fixed
rate of interest.
I approved some new names for investment, including top rated Dean Witter
Discover, First Bank of Minneapolis and First Union National Bank of North
Carolina. I added a floating rate note to the Portfolio so investors can
benefit from higher yields if short-term rates continue to rise.
Looking forward, I will continue to watch and anticipate changing trends in
short-term interest rates. In the near future, I will maintain a short
average maturity for the Portfolio. That will enable me to roll over
investments sooner, capturing higher rates that come along.
-16-
<PAGE> 17
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
INVESTMENT HIGHLIGHTS
As of June 30, 1996
MONEY MARKET PORTFOLIO
Illustration of a $10,000 investment:
Since Fund Inception on July 21, 1987 to June 30, 1996*
<TABLE>
<S> <C>
07/87 10,000
10,052
10,103
10,154
10,209
12/87 10,264
10,323
10,378
10,432
10,485
10,535
10,593
10,651
10,709
10,776
10,842
10,913
12/88 10,983
11,057
11,140
11,215
11,300
11,386
11,468
11,564
11,650
11,733
11,894
11,972
12/89 12,048
12,133
12,205
12,282
12,362
12,443
12,519
12,601
12,680
12,752
12,835
12,915
12/90 12,995
13,072
13,137
13,200
13,270
13,332
13,384
13,450
13,512
13,572
13,628
13,679
12/91 13,732
13,777
13,814
13,856
13,895
13,932
13,975
14,017
14,052
14,082
14,111
14,145
12/92 14,179
14,212
14,240
14,273
14,303
14,330
14,365
14,395
14,428
14,457
14,486
14,516
12/93 14,549
14,583
14,612
14,644
14,679
14,722
14,765
14,810
14,864
14,913
14,966
15,017
12/94 15,080
15,154
15,219
15,288
15,358
15,437
15,505
15,577
15,643
15,705
15,785
15,857
12/95 15,918
15,993
16,051
16,110
16,175
16,243
06/96 16,301
Money Market Portfolio: $16,301
</TABLE>
Average Annual Total Return
<TABLE>
<CAPTION>
Since
1 Year 5 Year Inception*
- -------------------------------------------------------------------
<S> <C> <C> <C>
Money Market Portfolio 5.14% 4.02% 5.63%
Weighted Average Maturity 38 days
</TABLE>
<TABLE>
<CAPTION>
Portfolio Credit Quality Percent
- -------------------------------------------------------------------
<S> <C>
Highest Quality(1) 100%
Split-Rated(2) --
Not Rated(3) --
</TABLE>
Performance represents the performance of the Money Market Portfolio
but does not include deductions for administration charges, contingent
deferred sales charges, or mortality and expense risk premiums.
Performance of the Portfolio assumes the reinvestment
of all dividends and capital gains. Investment returns are historical and
not predictive of future performance. Portfolio share prices and investment
returns will fluctuate.
The Money Market Portfolio seeks to maintain a $1.00 per share net
asset value. Shares of the Money Market Portfolio are neither insured nor
guaranteed by the U.S. Government. There is no assurance that the Money
Market Portfolio will maintain a stable $1.00 per share net asset value.
* The Portfolio's inception was July 21, 1987.
Performance information begins on July 31, 1987.
(1) Rated highest quality by at least two nationally recognized rating
organizations or, when rated by only one organization, received its
highest rating.
(2) Rated highest by one organization and second highest by another.
(3) Although unrated, comparable in credit quality to securities in the
highest or split-rated categories, in the opinion of SAFECO Asset
Management Company, the Portfolio's investment advisor.
- 17 -
<PAGE> 18
June 30, 1996 (Unaudited)
- -----------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
MONEY MARKET PORTFOLIO
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
(000'S) (000's)
<S> <C>
COMMERCIAL PAPER - 82.6%
Asset Backed - 9.3%
$ 450 Ciesco L.P.
5.26%, due 8/16/96 $ 447
450# Receivables Capital Corp. 4(2)
5.32%, due 7/29/96 448
Banks-Domestic - 8.2%
400 First Union Bank of North Carolina
5.00%, due 8/05/96 400
400 Seattle First National Bank
5.33%, due 7/09/96 400
Banks-Foreign - 13.9%
450 Cheltenham & Gloucester Building Society
5.40%, due 9/25/96 444
450 National Australia Funding (DE), Inc.
5.26%, due 7/19/96 449
450 Westpac Capital Corp.
5.25%, due 8/02/96 448
Finance-Auto - 13.9%
450 Ford Motor Credit Co.
5.28%, due 7/24/96 449
450 General Motors Acceptance Corp.
5.30%, due 8/13/96 447
450 New Center Asset Trust
5.37%, due 8/09/96 447
Finance-Consumer - 4.6%
450 Household Finance Corp.
5.28%, due 8/28/96 446
Finance-Diversified & Business - 9.5%
475 General Electric Capital Corp.
5.39%, due 8/29/96 471
450 Heller Financial, Inc.
5.45%, due 8/30/96 446
Insurance-Non-Affiliated Multi-Line - 4.7%
450 Prudential Funding Corp.
5.27%, due 7/17/96 449
Metals-Manufacturing/Fabricating - 4.6%
450 BHP Finance (USA), Inc.
5.30%, due 7/22/96 $ 448
Miscellaneous - 4.6%
450 Tasmanian Public Finance Corp.
5.25%, due 9/23/96 444
Utilities-Electric Distribution - 9.3%
450 Apreco, Inc.
5.30%, due 8/07/96 447
450 Cargill, Inc.
5.29%, due 7/10/96 449
-------
TOTAL COMMERCIAL PAPER 7,979
-------
U.S. GOVERNMENT & AGENCY SECURITIES - 6.2%
Federal National Mortgage Association - 6.2%
600 5.25%, due 7/11/96 599
-------
TOTAL U.S. GOVERNMENT &
AGENCY SECURITIES 599
-------
OTHER INVESTMENTS - 9.8%
Investment Companies:
475,224 Short-Term Investments Co.
(Prime Portfolio) 475
474,152 Short-Term Investments Co.
(Treasury Portfolio) 474
-------
TOTAL OTHER INVESTMENTS 949
-------
TOTAL INVESTMENTS - 98.6% 9,527
Other Assets, less Liabilities 130
-------
NET ASSETS $ 9,657
=======
</TABLE>
# Security exempt from registration and restricted as to resale only to
dealers, or through a dealer to an "accredited investor" or a "qualified
institutional buyer". At June 30, 1996 the fund held Receivables Capital
Corp. 4(2) at 5.32%, acquired 4/29/96, due 7/29/96. The total market value
of security is $448,005 or 4.7% of net assets.
See Notes to Financial Statements
-18 -
<PAGE> 19
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
PORTFOLIOS
-----------------------------------------
AS OF JUNE 30, 1996 EQUITY GROWTH NW BOND MMKT
- ------------------------------------------------------------------------------------------------------------------
-- (In Thousands, Except Per-Share Amounts) --
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments, at value:
Common stocks (identified cost $163,436, $64,732, and $5,975,
respectively) $198,397 $72,761 $6,666
Asset backed securities (identified cost $250) -- -- -- $251
Corporate bonds (identified cost $4,643) -- -- -- 4,643
U.S. Government and Agency Obligations (identified cost $10,013) -- -- -- 9,958
Temporary investments (at amortized cost which approximates market) 16,572 126 1,291 86 $9,527
-------- ------- ------ ------- ------
Total investments 214,969 72,887 7,957 14,938 9,527
Receivables:
Investment securities sold 384 -- -- -- --
Dividends and interest 381 50 8 230 20
Trust shares sold 411 357 104 5 87
-------- ------- ------ ------- ------
Total assets 216,145 73,294 8,069 15,173 9,634
-------- ------- ------ ------- ------
LIABILITIES:
Payables:
Investment securities purchased 675 -- -- -- --
Investment advisory fees 110 40 4 8 4
Trust shares redeemed 64 -- -- 9 (27)
Dividends payable -- 1 -- -- --
Other 10 10 -- -- --
-------- ------- ------ ------- ------
Total liabilities 859 51 4 17 (23)
-------- ------- ------ ------- ------
NET ASSETS $215,286 $73,243 $8,065 $15,156 $9,657
======== ======= ====== ======= ======
TRUST SHARES OUTSTANDING 10,053 3,986 675 1,372 9,657
======== ======= ====== ======= ======
NET ASSET VALUE PER SHARE
(Net assets divided by Trust shares outstanding) $21.42 $18.38 $11.95 $11.05 $1.00
======== ======= ====== ======= ======
</TABLE>
See Notes to Financial Statements
-19-
<PAGE> 20
June 30, 1996 (Unaudited)
- ---------------------------------------------------------------------------
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
PORTFOLIOS
---------------------------------------------------
For the Six Months Ended June 30, 1996
EQUITY GROWTH NW BOND MMKT
---------------------------------------------------
-- ($in Thousands) --
<S> <C> <C> <C> <C> <C>
Investment income:
Dividends $2,046 $124 $28 -- --
Interest 365 41 28 $465 $256
------- ------- ------- ------ ------
Total investment income 2,411 165 56 465 256
------- ------- ------- ------ ------
Expenses:
Investment advisory fees 653 203 25 55 29
Legal and auditing fees 9 7 7 4 7
Custodian fees 9 13 5 3 5
Trustees' fees 3 2 2 2 2
Other 1 2 2 1 0
------- ------- ------- ------ ------
Total expenses before reimbursement 675 227 41 65 43
Expense reimbursement (Note 4) -- -- (16) (10) (14)
------- ------- ------- ------ ------
Total expenses after reimbursement 675 227 25 55 29
------- ------- ------- ------ ------
Net investment income (loss) 1,736 (62) 31 410 227
------- ------- ------- ------ ------
Net realized and unrealized gain (loss) on investments:
Net realized gain (loss) on investments 8,317 5,132 295 (143) --
Net change in unrealized appreciation 10,477 2,902 353 (623) --
------- ------- ------- ------ ------
Net gain (loss) on investments 18,794 8,034 648 (766) --
------- ------- ------- ------ ------
Net change in net assets resulting from operations $20,530 $7,972 $679 $(356) $227
======= ======= ======= ======= =======
</TABLE>
See Notes to Financial Statements
- 20 -
<PAGE> 21
(Unaudited) SAFECO RESOURCE SERIES TRUST
- ---------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
PORTFOLIOS
------------------------------------------------------------------------------------
EQUITY GROWTH NW
------------------------------------------------------------------------------------
For the Six For the For the Six For the For the Six For the
Months Ended Year Ended Months Ended Year Ended Months Ended Year Ended
June 30 December 31 June 30 December 31 June 30 December 31
1996 1995 1996 1995 1996 1995
------------------------------------------------------------------------------------
-- (In Thousands, Except Per-Share Amounts) --
<S> <C> <C> <C> <C> <C> <C>
Operations:
Net investment income (loss) $ 1,736 $ 3,027 $ (62) $ 153 $ 31 $ 45
Net realized gain (loss) on investments 8,317 15,778 5,132 5,752 295 66
Net change in unrealized appreciation 10,477 14,951 2,902 4,187 353 196
----------- ----------- ----------- ----------- ------------ -----------
Net change in net assets resulting from
operations 20,530 33,756 7,972 10,092 679 307
Distributions to shareholders from:
Net investment income -- (3,027) -- (153) -- (45)
Net realized gain on investments -- (15,778) -- (5,752) -- (41)
Net Trust share transactions 25,277 52,207 20,813 24,115 1,074 1,527
----------- ----------- ----------- ----------- ------------ -----------
Total change in net assets 45,807 67,158 28,785 28,302 1,753 1,748
Net assets at beginning of period 169,479 102,321 44,458 16,156 6,312 4,564
----------- ----------- ----------- ----------- ------------ -----------
Net assets at end of period $ 215,286 $ 169,479 $ 73,243 $ 44,458 $ 8,065 $ 6,312
=========== =========== =========== =========== ============ ===========
OTHER INFORMATION
Increase (Decrease) in Fund Shares
and Amounts
Shares:
Sales 1,966 2,832 1,600 1,537 146 176
Reinvestments -- 977 -- 341 -- 5
Redemptions (720) (1,083) (414) (323) (53) (45)
----------- ----------- ----------- ----------- ------------ -----------
Net change 1,246 2,726 1,186 1,555 93 136
=========== =========== =========== =========== ============ ===========
Amounts:
Sales $ 39,886 $ 54,206 $ 27,710 $ 23,605 $ 1,692 $ 1,973
Reinvestments -- 18,805 -- 5,420 -- 57
Redemptions (14,609) (20,804) (6,897) (4,910) (618) (503)
----------- ----------- ----------- ----------- ------------ -----------
Net change $ 25,277 $ 52,207 $ 20,813 $ 24,115 $ 1,074 $ 1,527
=========== =========== =========== =========== ============ ===========
As of June 30, 1996:
Paid in capital $ 170,272 $ 60,144 $ 7,048
Par value per share $ 0.001 $ 0.001 $ 0.001
Trust shares authorized Unlimited Unlimited Unlimited
</TABLE>
See Notes to Financial Statements
- 21 -
<PAGE> 22
June 30, 1996 (Unaudited)
- -------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
(Continued)
<TABLE>
<CAPTION>
PORTFOLIOS
----------------------------------------------------------
BOND MMKT
-------------------------- --------------------------
For the For the For the For the
Six Months Year Six Months Year
Ended Ended Ended Ended
June 30 December 31 June 30 December 31
1996 1995 1996 1995
---------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
Operations:
Net investment income (loss) $ 410 $ 843 $ 227 $ 468
Net realized gain (loss) on investments (143) 116 -- --
Net change in unrealized appreciation (623) 1,162 -- --
--------- --------- --------- ---------
Net change in net assets resulting from
operations (356) 2,121 227 468
Dividends to shareholders from:
Net investment income -- (843) (227) (468)
Net realized gain on investments -- -- -- --
Net Trust share transactions 1,255 (382) 938 (596)
--------- --------- --------- ---------
Total change in net assets 899 896 938 (596)
Net assets at beginning of period 14,257 13,361 8,719 9,315
--------- --------- --------- ---------
Net assets at end of period $ 15,156 $ 14,257 $ 9,657 $ 8,719
========= ========= ========= =========
Other Information
Increase (Decrease) in Fund Shares and Amounts
Shares:
Sales 319 266 21,104 21,270
Reinvestments -- 75 227 432
Redemptions (208) (390) (20,393) (22,298)
--------- --------- --------- ---------
Net change 111 (49) 938 (596)
========= ========= ========= =========
Amounts:
Sales $ 3,539 $ 2,941 $ 21,104 $ 21,270
Reinvestments -- 843 227 432
Redemptions (2,284) (4,166) (20,393) (22,298)
--------- --------- --------- ---------
Net change $ 1,255 $ (382) $ 938 $ (596)
========= ========= ========= =========
As of June 30, 1996:
Paid in capital $ 15,175 $ 9,657
Par value per share $ 0.001 $ 0.001
Trust shares authorized Unlimited Unlimited
</TABLE>
See Notes to Financial Statements
- 22 -
<PAGE> 23
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES
SAFECO Resource Series Trust (the "Trust") is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The Trust is comprised of the Equity, Growth, Northwest
(NW), Bond and Money Market (MMKT) Portfolios. Each of the five Portfolios has
different investment objectives. Shares of the Trust Portfolios are available as
funding vehicles for certain products sold by SAFECO Life Insurance Company
("SAFECO"). Currently, all shares of the Trust are owned by SAFECO or its
affiliate, SAFECO Asset Management Company. Shares of the Portfolios are also
available as funding vehicles for certain products sold by other insurance
companies. The following is a summary of significant accounting policies
consistently followed by the Trust in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principles, which permits management to make certain estimates and assumptions
at the date of the financial statements.
SECURITY VALUATION -- Securities in the Equity, Growth, Northwest and Bond
Portfolios traded on a national exchange or over-the-counter are valued at the
last reported sales price, unless there are no transactions in which case they
are valued at the last reported bid price. Long-term corporate bonds and other
securities not traded on a national exchange or over-the-counter are valued
based on consideration of information with respect to transactions in bonds,
quotations from bond dealers, market transactions in comparable securities and
various relationships between securities. Securities in the Money Market
Portfolio purchased at par are valued at cost. All other short-term securities
are valued at amortized cost.
SECURITY TRANSACTIONS -- Security transactions are recorded on the trade date.
Realized gains and losses on securities transactions are determined using the
identified cost method.
INCOME RECOGNITION -- Interest is accrued on Portfolio investments daily.
Dividend income, less foreign taxes withheld (if any), is recorded on the
ex-dividend date.
DIVIDENDS TO SHAREHOLDERS -- In the Equity, Growth, Northwest and Bond
Portfolios, dividends to shareholders from net investment income and realized
gains on security transactions (if any) are recorded on the last business day of
December each year. In the Money Market Portfolio, dividends from net investment
income are declared as of the close of each business day and payment is made as
of the last business day of each month.
FEDERAL INCOME TAX -- It is the Trust's policy to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to its shareholders. Therefore, no federal
income or excise tax provision is required.
- 23 -
<PAGE> 24
June 30, 1996 (Unaudited)
- ---------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Continued)
<TABLE>
<CAPTION>
PORTFOLIOS
------------------------------------
EQUITY GROWTH NW BOND
- -------------------------------------------------------------------------------------------------------------
-- ($ in Thousands) --
<S> <C> <C> <C> <C> <C>
2. INVESTMENT TRANSACTIONS
PURCHASES for the six months ended June 30, 1996 (including $7,547
of U.S. Government and Agency Securities in the Bond Portfolio) $72,911 $52,220 $2,647 $ 8,297
======= ======= ====== =======
SALES for the six months ended June 30, 1996 (including $12,596
of U.S. Government and Agency Securities in the Bond Portfolio) $56,779 $31,283 $1,881 $12,596
======= ======= ====== =======
</TABLE>
Purchases and sales amounts exclude short-term investments which, at the
time of purchase, had a maturity of one year or less.
<TABLE>
<CAPTION>
-- ($ in Thousands) --
<S> <C> <C> <C> <C> <C>
UNREALIZED APPRECIATION (DEPRECIATION) AT JUNE 30, 1996:
Aggregate gross unrealized appreciation for investment securities
in which there is an excess of value over identified cost $36,783 $11,736 $1,176 $ 69
Aggregate gross unrealized depreciation for investment securities
in which there is an excess of identified cost over value (1,822) (3,707) (485) (123)
------- ------- ------ -------
Net unrealized appreciation (depreciation) $34,961 $ 8,029 $ 691 $ (54)
======= ======= ====== =======
-- ($ in Thousands) --
3. ACCUMULATED UNDISTRIBUTED AMOUNTS
As of June 30, 1996:
Accumulated undistributed net investment income (loss) $ 1,736 $ (62) $ 31 $ 410
======= ======= ====== =======
Accumulated undistributed net realized gain (loss)
on investment transactions $ 8,317 $ 5,132 $ 295 $ (375)
======= ======= ====== =======
</TABLE>
4. INVESTMENT ADVISORY FEES, EXPENSE REIMBURSEMENT AND OTHER TRANSACTIONS WITH
AFFILIATES
SAFECO Asset Management Company receives investment advisory fees from the
Trust. For the Equity, Growth, Northwest and Bond Portfolios, the fee is
based on average daily net assets at an annual rate of .74 percent. For the
Money Market Portfolio, the fee is based on average daily net assets at an
annual rate of .65 percent.
The Portfolios may borrow money for temporary purposes from SAFECO
Corporation or its affiliates at interest rates equivalent to commercial
bank interest rates.
Prior to May 5, 1994, SAFECO Life Insurance Company (SAFECO) paid all the
expenses of the portfolios except for investment advisory fees. Beginning
on May 5, 1994, any portfolio with net assets in excess of $20 million is
charged for all other operating expenses, including legal and auditing
fees, trustees' fees, custodian fees, and other expenses. For portfolios
with net assets less than $20 million, SAFECO continues to pay the
portfolios other operating expenses.
- 24 -
<PAGE> 25
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Continued)
5. FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout the Period)
<TABLE>
<CAPTION>
EQUITY PORTFOLIO
-------------------------------------------------------------------
For the
Six
Months
Ended
June 30 Year Ended December 31
-------- -------------------------------------------------------
1996 1995 1994 1993 1992 1991
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of period $ 19.24 $ 16.83 $ 17.02 $ 14.20 $ 13.48 $ 11.38
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.17 0.39 0.31 0.23 0.20 0.24
Net realized and unrealized gain on investments 2.01 4.43 1.21 3.74 0.89 2.82
-------- -------- -------- -------- -------- --------
Total from investment operations 2.18 4.82 1.52 3.97 1.09 3.06
-------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net investment income -- (0.39) (0.31) (0.23) (0.20) (0.24)
Distributions from realized gains -- (2.02) (1.40) (0.92) (0.17) (0.72)
-------- -------- -------- -------- -------- --------
Total distributions -- (2.41) (1.71) (1.15) (0.37) (0.96)
-------- -------- -------- -------- -------- --------
Net asset value at end of period $ 21.42 $ 19.24 $ 16.83 $ 17.02 $ 14.20 $ 13.48
======== ======== ======== ======= ======== ========
Total return 11.33%** 28.63% 8.94%(A) 27.92%(A) 8.06%(A) 26.85%(A)
Net assets at end of period (000's omitted) $215,286 $169,479 $102,321 $68,157 $36,064 $20,402
Ratio of expenses to average net assets .71%* .75% .77% .73% .73% .73%
Ratio of expenses to average net assets
before expense reimbursements ++ N/A N/A 78% -- -- --
Ratio of net investment income to
average net assets 1.82%* 2.26% 1.98% 1.71% 1.80% 2.31%
Portfolio turnover rate 63.48%* 69.18% 28.71% 41.35% 24.75% 43.60%
Average Commission Rate Paid $0.0594 -- -- -- -- --
</TABLE>
* Annualized.
** Not Annualized.
++ See Note 4 of Notes to Financial Statements.
(A) The total return would have been lower had certain expenses not been
reduced during the periods shown (See Note 4 of Notes to Financial
Statements).
N/A Not applicable as no fund expenses were reimbursed.
- 25 -
<PAGE> 26
June 30, 1996 (Unaudited)
- ------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Continued)
5. FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout the Period)
<TABLE>
<CAPTION>
GROWTH PORTFOLIO
------------------------------------------------------
For the Six
Months Ended Year Ended January 7, 1993
June 30 December 31, (Commencement of
------------ -------------------- Operations) to
1996 1995 1994 December 31, 1993
------------ ------- --------- -----------------
<S> <C> <C> <C> <C>
Net asset value at beginning of period $ 15.88 $ 12.98 $ 12.16 $ 10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (0.02) 0.06 -- 0.01
Net realized and unrealized gain on investments 2.52 5.26 1.45 3.60
-------- ------- ------- -------
Total from investment operations 2.50 5.32 1.45 3.61
-------- ------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income -- (0.06) -- (0.01)
Distributions from realized gains -- (2.36) (0.63) (1.44)
-------- ------- ------- -------
Total distributions -- (2.42) (0.63) (1.45)
-------- ------- ------- -------
Net asset value at end of period $ 18.38 $ 15.88 $ 12.98 $ 12.16
======== ======= ======= =======
Total return 15.74%** 41.00%(A) 11.92%(A) 34.73%**(A)
Net assets at end of period (000's omitted) $ 73,243 $44,458 $16,156 $ 4,850
Ratio of expenses to average net assets .80%* .79% .71% .72%*
Ratio of expenses to average net assets
before expense reimbursements ++ N/A .84% .96% --%
Ratio of net investment income (loss) to
average net assets (.22)%* .55% (.05)% 0.08%*
Portfolio turnover rate 111.13%* 111.70% 41.24% 108.67%*
Average Commission Rate Paid $ 0.0549 -- -- --
</TABLE>
* Annualized.
** Not Annualized. Performance information for the period ended December 31,
1993 begins on January 31, 1993.
++ See Note 4 of Notes to Financial Statements.
(A) The total return would have been lower had certain expenses not been
reduced during the periods shown (See Note 4 of Notes to Financial
Statements).
N/A Not applicable as no fund expenses were reimbursed.
- 26 -
<PAGE> 27
SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Continued)
5. FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout the Period)
<TABLE>
<CAPTION>
NORTHWEST PORTFOLIO
--------------------------------------------
For the January 7, 1993
Six Months (Commencement of
Ended Year Ended Operations) to
June 30 December 31 December 31,
---------- --------------- --------------
1996 1995 1994 1993
---------- ------- ------- --------------
<S> <C> <C> <C> <C>
Net asset value at beginning of
period $10.85 $10.24 $ 9.94 $10.00
Income from investment operations:
Net investment income 0.05 0.08 0.06 0.09
Net realized and unrealized gain
(loss) on investments 1.05 0.68 0.30 (0.06)
---------- ------- ------- ------------
Total from investment operations 1.10 0.76 0.36 0.03
---------- ------- ------- ------------
Less distributions:
Dividends from net investment
income -- (0.08) (0.06) (0.09)
Distributions from realized gains -- (0.07) -- --
---------- ------- ------- ------------
Total distributions -- (0.15) (0.06) (0.09)
---------- ------- ------- ------------
Net asset value at end of period $11.95 $10.85 $10.24 $ 9.94
Total return (A) 10.14%** 7.42% 3.65% (.55%)**
Net assets at end of period
(000's omitted) $8,065 $6,312 $4,564 $3,183
Ratio of expenses to average
net assets .69%* .71% .71% .72%*
Ratio of expenses to average
net assets before expense
reimbursements ++ 1.12%* 1.18% 1.23% --
Ratio of net investment income
to average net assets .86%* .81% .72% 1.06%*
Portfolio turnover rate 60.63%* 21.30% 7.29% 3.93%*
Average Commission Rate Paid $0.0593 -- -- --
</TABLE>
* Annualized.
** Not Annualized. Performance information for the period ended
December 31, 1993 begins on January 31, 1993.
++ See Note 4 of Notes to Financial Statements.
(A) The total return would have been lower had certain expenses not been
reduced during the periods shown (See Note 4 of Notes to Financial
Statements).
-27-
<PAGE> 28
June 30, 1996 (Unaudited)
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Continued)
5. FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout the Period)
<TABLE>
<CAPTION>
BOND PORTFOLIO
--------------------------------------------------------
For the Six
Months Ended Year Ended December 31
June 30
------------ -------------------------------------------
1996 1995 1994 1993 1992 1991
------------ ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at
beginning of period $ 11.31 $ 10.20 $ 11.12 $ 10.82 $ 10.80 $ 10.09
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income 0.30 0.71 0.59 0.56 0.58 0.70
Net realized and
unrealized gain (loss)
on investments (0.56) 1.11 (0.92) 0.58 0.16 0.71
------- ------- ------- ------- ------- -------
Total from investment
operations (0.26) 1.82 (0.33) 1.14 0.74 1.41
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net
investment income -- (0.71) (0.59) (0.56) (0.58) (0.70)
Distributions from
realized gains -- -- -- (0.28) (0.14) --
------- ------- ------- ------- ------- -------
Total distributions -- (0.71) (0.59) (0.84) (0.72) (0.70)
------- ------- ------- ------- ------- -------
Net asset value at end
of period $ 11.05 $ 11.31 $ 10.20 $ 11.12 $ 10.82 $ 10.80
======= ======= ======= ======= ======= =======
Total return (A) (2.30)%** 17.87% (2.93)% 10.55% 6.82% 13.98%
Net assets at end of
period (000'S omitted) $15,156 $14,257 $13,361 $13,245 $ 9,172 $ 4,852
Ratio of expenses to
average net assets .72%* .72% .72% .73% .74% .74%
before expense
reimbursements ++ .84% .94% .89% -- -- --
Ratio of net investment
income to average
net assets 5.44%* 6.50% 5.53% 5.68% 6.96% 7.26%
Portfolio turnover rate 165.36%* 77.93% 147.22% 60.20% 46.66% 36.31%
</TABLE>
* Annualized.
** Not Annualized.
++ See Note 4 of Notes to Financial Statements.
(A) The total return would have been lower had certain expenses not been reduced
during the periods shown (See Note 4 of Notes to Financial Statements).
-28-
<PAGE> 29
(Unaudited) SAFECO RESOURCE SERIES TRUST
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Continued)
5. FINANCIAL HIGHLIGHTS
(For a Share Outstanding Throughout the Period)
MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the
Six Months
Ended
June 30 Year Ended December 31
--------- ----------------------------------------
1996 1995 1994 1993 1992 1991
--------- ----------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value at
beginning of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from investment
operations:
Net investment income 0.02 0.05 0.04 0.03 0.03 0.06
Less distributions:
Dividends from net
investment income (0.02) (0.05) (0.04) (0.03) (0.03) (0.06)
----- ----- ----- ----- ----- -----
Net asset value at
end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ===== ===== ===== =====
Total return(A) 2.40%** 5.56% 3.65% 2.61% 3.26% 5.67%
Net assets at end
of period
(000's omitted) $9,657 $8,719 $9,315 $6,327 $5,399 $4,534
Ratio of expenses to
average net assets .61%* .62% .63% .64% .68% .74%
Ratio of expenses to
average net assets
before expense
reimbursements++ .92%* .87% .87% -- -- --
Ratio of net investment
income to average
net assets 4.80%* 5.32% 3.63% 2.61% 3.23% 5.54%
</TABLE>
* Annualized.
** Not Annualized.
++ See Note 4 of Notes to Financial Statements.
(A) The total return would have been lower had certain expenses not been reduced
during the periods shown (See Note 4 of Notes to Financial Statements).
-29-
