<PAGE> cover
Semi-Annual Report September 30, 1995
PIMCO
VersaSTYLE Equity Fund
<PAGE> 1
Statement of Assets and Liabilities
September 30, 1995 (unaudited)
<TABLE>
<CAPTION>
Amounts in thousands, except per share amounts
<S> <C>
Assets:
Investments, at value $6,129
Receivable for investments sold 144
Receivable from adviser 19
Interest and dividends
receivable 15
Other assets 2
6,309
Liabilities:
Payable for investments
purchased 136
Accrued investment adviser's fee 2
Accrued administrator's fee 1
Other accrued expenses and 20
liabilities
159
Net Assets $6,150
Net Assets Consist of:
Paid in capital $5,113
Undistributed net investment income 0
Accumulated undistributed net 202
realized gain
Net unrealized appreciation 835
$6,150
Shares Issued and Outstanding 511
Net Asset Value, Offering and $ 12.04
Redemption Price Per
Share (Net Assets Per Share
Outstanding)
Cost of Investments Owned $ 5,294
Cost of Foreign Currency Held 78
</TABLE>
See Notes to Financial Statements
<PAGE> 2
Statement of Operations
<TABLE>
<CAPTION>
For the six months ended September 30, 1995 (unaudited)
$ in thousands
<S> <C>
Investment Income:
Dividends $ 70
Interest 1
Total investment income 71
Expenses:
Investment advisory fees 13
Administration fees 3
Custodian and transfer agent
fees 26
Registration fees 1
Audit fees 8
Reimbursement from adviser (33)
Total expenses
18
Fees paid indirectly 0
Net expenses
18
Net Investment Income 53
Net Realized and Unrealized Gain
Net realized gain on investments 345
Net change in unrealized 581
appreciation on investments
Net Gain 926
Net Increase in Assets
Resulting $ 979
from Operations
</TABLE>
See Notes to Financial Statements
<PAGE> 3
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
$ in thousands
From commencement
Six months ended on September 30, 1994
September 30, 1995 through
(unaudited) March 31, 1995
<S> <C> <C>
Increase in Net Assets from:
Operations
Net investment income $ 53 $ 60
Net realized gain (loss) 345 (143)
Net change in unrealized appreciation 581 254
Net increase resulting from operations 979 171
Distributions to Shareholders
From net investment income (53) (60)
From net realized capital gains 0 0
Total distributions (53) (60)
Fund Share Transactions
Receipts for shares sold 0 5,000
Issued as reinvestment of distributions 53 60
Cost of shares redeemed 0 0
Net increase resulting from Fund share 53 5,060
transactions
Total Increase in Net Assets 979 5,171
Net Assets
Beginning of period $ 5,171 $ 0
End of period * 6,150 5,171
* Including undistributed net 0 0
investment income of:
</TABLE>
See Notes to Financial Statements
<PAGE> 4
Financial Highlights
<TABLE>
<CAPTION> From commencement
Six months ended on September 30, 1994
Selected Per Share Data for the September 30, 1995 through
period ended: (unaudited) March 31, 1995
<S> <C> <C>
Net asset value beginning of period $10.22 $10.00
Net investment income 0.10 0.12
Net realized and unrealized gain
on investments 1.82 0.22
Total Income from investment 1.92 0.34
operations
Dividends from net investment income (0.10) (0.12)
Distributions from net realized 0.00 0.00
capital gains
Total distributions (0.10) (0.12)
Net asset value end of period 12.04 10.22
Total return (%) 18.89 3.44
Net assets end of period (000's) $6,150 $5,171
Ratio of expenses to average net 0.65 + 0.65 +
assets (%)
Ratio of net investment income to 1.88 + 2.45 +
average net assets (%)
Portfolio turnover rate (%) 91 159
</TABLE>
+ Annualized
See Notes to Financial Statements
<PAGE> 5
<TABLE>
Schedule of Investments
<CAPTION>
September 30, 1995 (unaudited)
Value
Share (000's)
<S> <C> <C>
Common Stocks - 99.4%
Energy Producers - 2.1%
Amoco 500 32
Broken Hill Proprietary Ltd. 200 11
Helmerich & Payne, Inc. 200 6
Mitchell Energy & Development Corp. "A" 600 11
Mitchell Energy & Development Corp. "B" 500 9
Occidental Petroleum 500 11
Parker Drilling Co. (b) 3,300 20
Smith International,Inc. (b) 900 16
Union Texas Petroleum Holdings, Inc. 600 11
127
Energy Refiners - 4.6%
British Petroleum Co. PLC 500 45
Exxon Corp. 1,000 72
Mobil Corp. 200 20
Royal Dutch Petroleum Co. 1,200 147
Valero Energy Corp. 100 2
286
Technology - 11.9%
AMP, Inc. 140 5
Applied Magnetics Corp.(b) 700 11
Automatic Data Processing, Inc. 400 27
Cabletron Systems, Inc.(b) 400 26
Cadence Design Systems,Inc. (b) 400 16
Cheyenne Software, Inc.(b) 800 16
Comdisco, Inc. 800 24
Continuum. Inc. (b) 400 15
EMC Corp. (b) 800 15
Ericsson LM Telefonktiebolaget (b) 1,300 32
General Motors Corp. "E" 500 23
Hutchinson Technology,Inc. (b) 200 12
International Business Machines Corp. 200 19
Kent Electronics Corp. (b) 1,350 59
Kulicke & Soffa Industries, Inc.(b) 600 22
Kyocera Corp. 200 34
Logicon, Inc. 3,200 86
LSI Logic Corp. (b) 300 17
Microsoft Corp. (b) 300 27
Motorola, Inc. 100 8
NEC Corp. 300 21
Network Equipment Technologies, Inc. (b) 600 25
Parametric Technology Corp. (b) 300 19
Shared Medical Systems Corp. 700 29
Sony Corp. 200 11
Sterling Software, Inc.(b) 400 18
Structural Dynamics Research Corp. (b) 1,100 20
Symbol Technologies,Inc. (b) 600 20
Systems & Computer Technology Corp. (b) 300 8
Tellabs, Inc. (b) 300 13
Texas Instruments, Inc. 200 16
Wyle Electronics 800 36
730
Consumer Discretionary - 10.2%
PHH Corp. 500 23
American Business Products, Inc. 2,550 53
Blair Corp. 900 31
Casey's General Stores,Inc. 1,000 23
CCH, Inc. "B" 1,700 38
Claire's Stores, Inc. 1,300 27
Comcast Corp "A" 200 4
CPI Corp 2,200 49
Cross (A.T.) Company "A" 1,900 32
Gillette Co. 1,700 81
Harcourt General, Inc. 600 25
Hilton Hotels Corp. 200 13
Jostens, Inc. 1,000 24
</TABLE>
<PAGE> 6
Schedule of Investments
(Cont.)
<TABLE>
September 30, 1995
(unaudited)
<CAPTION>
Value
Share (000's)
<S> <C> <C>
Medicine Shoppe 800 35
International, Inc.
National Presto Industries, Inc. 900 40
Nelson Thomas, Inc. 475 12
Newell Co. 500 12
Pulitzer Publishing Co. 500 26
Robert Half International, Inc.(b) 300 10
Russ Berrie & Co. 1,100 17
Wolverine World Wide,Inc. 1,850 51
626
Consumer Staples - 11.4%
Alberto-Culver Co. "B" 300 9
Anheuser Busch Co's Inc. 400 25
B A T Industries PLC 1,400 24
Block Drug Co., Inc. 600 23
Campbell Soup Co. 300 15
Church & Dwight, Inc. 3,200 70
Coca-Cola Co. 600 41
Colgate Palmolive 300 20
ConAgra, Inc. 700 28
CPC International, Inc. 400 26
General Mills, Inc. 300 17
Hanson PLC 500 8
Hershey Foods, Inc. 300 19
IBP, Inc. 400 21
International Flavors & Fragrances, Inc. 400 19
Kellogg Co. 600 43
Pepsico, Inc. 500 26
Ralston Purina Co. 100 6
Richfood Holdings, Inc. 700 18
Rykoff-Sexton, Inc. 1,500 35
Sara Lee Corp. 1,100 33
The Procter & Gamble Co. 400 31
Unilever N.V. 200 26
Universal Corp. 1,000 23
UST, Inc. 1,400 40
Vons Companies (b) 600 14
Walgreen Co. 600 17
</TABLE>
<TABLE>
<CAPTION>
Value
Share (000's)
<S> <C> <C>
Wrigley WM Jr. Company 500 25
702
Banks - 6.7%
California Federal Bank (b) 3,600 57
City National Corporation 700 9
Coast Savings Financial,Inc. (b) 600 16
Comerica, Inc. 600 22
Concord EFS, Inc. (b) 600 18
Cullen Frost Bankers,Inc. 600 28
Fifth Third Bancorp 300 17
First Bank System, Inc. 500 24
Marshall & Ilsley Corp. 1,000 25
Morgan J.P. & Co. 100 8
North Fork Bancorporation, Inc. 500 10
Norwest Corp. 800 26
Santander Banco 400 17
Suntrust Banks, Inc. 1,100 73
TCF Financial Corp. 600 35
Zions Bancorporation 400 25
410
Non-Bank Financials - 7.9%
Aegon, N.V. 500 18
Alex Brown, Inc. 400 23
CNA Financial Corp. (b) 300 32
Capstead Mortgage Corp. 1,200 38
Cigna Corp. 200 21
CWM Mortgage Holdings, Inc. 4,400 59
Federal National Mortgage Association 300 31
First American Financial Corp. 1,000 24
Foothill Group, Inc. "A" 700 21
Gallagher Arthur J & Co. 600 21
General RE Corp. 200 30
Legg Mason, Inc. 2,200 65
Merrill Lynch & Co.,Inc. 600 38
Policy Management Systems Corp. (b) 200 10
Resource Mortgage Capital, Inc. 1,000 20
</TABLE>
<PAGE> 7
Schedule of Investments
(Cont.)
September 30, 1995
(unaudited)
<TABLE>
<CAPTION> Value
Share (000's)
<S> <C> <C>
Washington National Corp. 1,300 32
483
Electric and Gas - 4.9%
Black Hills Corp. 1,000 25
Central Maine Power Co. 5,100 67
Idaho Power Co. 200 6
New Jersey Resources 3,200 83
Corp.
Northwestern Public 400 10
Services Co.
Oneok, Inc. 1,000 23
South Jersey Industries, 2,000 42
Inc.
The Southern Co. 600 14
United Water Resources, 2,700 34
Inc.
304
Telecommunications - 7.6%
Ameritech Corp. 1,500 78
AT&T Corp. 300 20
Bell Atlantic Corp. 1,800 110
Bellsouth Corp. 1,100 80
Frontier Corp. 700 19
GTE Corp. 1,300 51
SBC Communications, Inc. 1,800 99
Southern New England 100 4
Telecom U. S. West, Inc. 200 9
470
Basic Materials - 7.5%
Air Products & 400 21
Chemicals, Inc.
Airgas, Inc. (b) 800 21
Carpenter Technology 600 23
Corp.
Coeur D Alene Mines 1,100 22
Corp.
Commercial Metals Co. 100 3
Dexter Corp. 1,000 26
Domtar, Inc. (b) 2,000 19
Dravo Corp. (b) 500 6
</TABLE>
<TABLE>
<CAPTION>
Value
Share (000's)
<S> <C> <C>
Dupont (E.I.) De Nemours 100 7
Florida Rock Industries,Inc. 1,000 28
Georgia-Pacific Corp. 100 9
Glatfelter Paper & Products Co. 1,000 23
Hanna (M.A.) Co. 800 21
Hercules, Inc. 300 17
Imco Recycling, Inc. 300 7
Loctite Corp. 300 15
RPM, Inc. Ohio 1,100 22
Synalloy Corp. 1,500 34
Tambrands, Inc. 400 18
Texas Industries, Inc. 500 26
The Dow Chemical Co. 400 30
Univar Corp. 1,400 20
Varlen Corp. 550 15
Wallace Computer Service, Inc. 500 29
462
Capital Goods - 10.6%
AAR Corp. 600 11
Baldor Electric 1,200 30
Blount Inc. "A" 900 43
Champion Enterprises, Inc. "A" (b) 900 18
Donaldson Co., Inc. 900 22
Electro Scientific Industries (b) 100 3
Fluke Corp. 700 27
Graco, Inc. 2,500 85
Groundwater Technology, Inc. (b) 1,300 17
Keystone International,Inc. 600 13
Lawson Products, Inc. 800 22
Loral Corp. 500 29
Manitowoc, Inc. 1,800 53
Oakwood Homes Corp. 800 28
Regal Beloit Corp. 2,000 37
Rexel, Inc. (b) 2,200 22
Rockwell International Corp. 500 24
SPS Technologies, Inc.(b) 600 23
United States Filter Corp. (b) 2,600 62
Watkins Johnson Co. 700 38
</TABLE>
<PAGE> 8
Schedule of Investments
(Cont.)
September 30, 1995
(unaudited)
<TABLE>
<CAPTION> Value
Share (000's)
<S> <C> <C>
Zurn Industries 1,700 43
650
Health Care- 10.9%
Alpharma, Inc. "A" 400 9
Abbott Laboratories 1,300 55
Alza Corp. "A" (b) 1,000 23
American Home Products 300 25
Bergen Brunswig Corp. 900 19
Bristol-Meyers-Squibb Co. 200 15
Cardinal Health, Inc. 500 28
Cordis Corp. (b) 300 25
Datascope Corp (b) 500 10
Eli Lilly & Co. 200 18
Healthsouth Corp. (b) 1,100 28
Invacare Corp. 700 33
Johnson & Johnson 300 22
Medtronic, Inc. 600 32
North American Vaccine,Inc. (b) 2,300 26
Pfizer, Inc. 800 43
Research Industries Corp. (b) 1,400 41
Schering Plough Corp. 300 15
Sierra Health Services, Inc. (b) 800 20
St. Jude Medical, Inc. (b) 400 25
Stryker Corp. 900 42
Sunrise Medical, Inc.(b) 200 6
Surgical Care Affiliates, Inc. 900 21
U.S. Healthcare, Inc. 500 18
United Healthcare Corp 500 24
Universal Health Services, Inc. (b) 1,200 41
Vencor, Inc. (b) 200 6
670
Automobiles and Transportation - 3.1%
Alaska Air Group, Inc. (b) 1,300 20
American Freigntways Corp. (b) 400 6
Value
Shares (000's)
American President Co.,Ltd. 800 23
Clarcor, Inc. 1,000 24
Cooper Tire & Rubber Co. 400 10
Genuine Parts Co. 200 8
Federal Signal Corp. 600 13
Harper Group, Inc. 100 2
Kansas City Southern Industries, Inc. 200 9
Mesa Airlines. Inc. (b) 2,200 22
Superior Industries Int'l, Inc. 700 19
Toyota Motor Corp. 500 19
TRW, Inc. 200 15
190
Total Common Stocks - 6,110
Principal
amount
(000's)
Repurchase Agreements - 0.3%
State Street Bank
5.25% due 10/02/95. 19 19
(Dated 09/29/95.
Collateralized by
U.S. Treasury Note
6.875% 02/28/97 valued at $20,366.
Repurchase proceeds are $19,008.)
Total Investments (a) -99.7% $6129
(Cost $5,294)
Other Assets and Liabilities 21
(Net) - 0.3%
Net Assets - 100.0% $6,150
</TABLE>
<PAGE> 9
Schedule of Investments
(Cont.)
September 30, 1995
(unaudited)
Notes to Schedule of
Investments ($ in
thousands):
(a) At September 30,
1995, the
net realized
appreciation
(depreciation) of
investments based on
cost for federal income
tax purposes was as follows:
Aggregate gross
unrealized
appreciation for all
investments in which
there was
an excess of value
over tax cost. $ 886
Aggregate gross
unrealized
depreciation for all
investments in which
there was an (50)
excess of tax
cost over value.
Unrealized appreciation-
net $ 836
(b) Non-income producing
security.
See Notes to Financial Statements
<PAGE> 10
Notes To Financial Statements
September 30,1995 (unaudited)
1. Significant Accounting Policies
The VersaSTYLE Equity Fund (the "Fund"), which
commenced operations on September 30, 1994, is a
series of the PIMCO Funds (the "Trust"). The
Trust was organized under the laws of the
Commonwealth of Massachusetts on February 19,
1987, and is registered under the Investment
Company Act of 1940, as amended, as a no-load,
open-end management investment company.
The following is a summary of significant
accounting policies followed in the preparation
of the Fund's financial statements. These
policies are in conformity with generally
accepted accounting principles.
Security Valuation. Portfolio securities and
other assets for which market quotations are
readily available are stated at market value.
Market value is determined on the basis of last
reported sales prices, or if no sales are
reported, as is the case for most securities
traded over-the-counter, the mean between
representative bid and asked quotations obtained
from a quotation reporting system or from
established market makers. Fixed income
securities, including those to be purchased
under firm commitment agreements, are
normally valued on the basis of quotes
obtained from brokers and dealers or
pricing services. Foreign currency amounts are
converted to U.S. equivalents using foreign
exchange quotations from independent
dealers. Short-term investments having a
maturity of sixty days or less are valued at
amortized cost, which approximates market value.
Certain fixed income securities for which
daily market quotations are not available may be
valued, pursuant to guidelines established by
the Board of Trustees, with reference to fixed
income securities whose prices are more readily
obtainable.
Security Transactions and Investment Income.
Security transactions are recorded as of the
trade date. Realized gains and losses from
securities sold are recorded on the identified
cost basis. Dividend income is recorded on the ex
dividend date. Interest income is recorded on
the accrual basis and includes the
accretion of discounts and amortization of
premiums.
Dividends and Distributions to Shareholders.
The Fund declares and distributes
dividends representing substantially all net
investment income on a quarterly basis. Net
long-term capital gains will be distributed no
less frequently than once each year. Foreign
exchange gains or losses on investments and the income
generated from such investments, arising from
fluctuations of exchange rates of the non-
dollar denominated investment relative to the
U.S. dollar, are reported to shareholders as
ordinary income distributions in accordance
with the provisions of the Internal Revenue
Code.
Income distributions and capital gain
distributions are determined in accordance
with income tax regulations which may differ
from generally accepted accounting principles.
These differences are primarily due to
differing treatments for such items as wash
sales, foreign currency transactions and capital
loss carryforwards.
Federal Taxes. It is the Fund's policy to
distribute all of its taxable income to
shareholders and otherwise comply with the
provisions of the Internal Revenue Code
applicable to regulated investment companies.
Therefore, no provision has been made for
federal income tax on net investment income
and realized or unrealized capital
gains.
<PAGE> 11
Notes To Financial Statements (Cont.)
Futures and Options. The Fund is authorized to
enter into futures contracts and options. The
primary risks associated with the use of
futures contracts and options are imperfect
correlation between the change in market value
of the securities held by the Fund and the prices
of futures contracts and options, and the
possibility of an illiquid market. Futures
contracts and purchased options are valued based
upon their quoted daily settlement prices. The
premium received for a written option is
recorded as an asset with an equal
liability which is marked to market based on
the option's daily settlement price.
Fluctuations in value of such instruments
are recorded as unrealized appreciation
(depreciation) until terminated at which time
realized gains and losses are recognized.
Foreign Currency Contracts. The Fund is
authorized to enter into forward foreign
exchange contracts as a hedge against either
specific transactions or portfolio positions or
for purposes of increasing exposure to a
particular foreign currency. The aggregate
principal amounts of the contracts for which
delivery is anticipated are recorded in the
Fund's accounts, while such amounts are not
recorded if the Fund intends to settle the
contract prior to delivery. The Fund records
realized gains or losses at the time the
forward contract is extinguished by entry into a
closing transaction or by delivery of the
currency. Risks may arise upon entering
into these contracts from the potential
inability of counterparties to meet the terms
of their contracts and from unanticipated
movements in the value of a foreign currency
relative to the U.S. dollar.
2. Fees, Expenses, and Related Party Transactions
Investment Advisory Fee. Pacific Investment
Management Company ("PIMCO") serves as
investment adviser (the
"Adviser") to the Trust, pursuant to an
investment advisory contract. Prior to October
1, 1995, the Adviser received a monthly fee
from the Fund at an annual rate based on average
daily net assets of the Fund as follows: 0.45%
of the first $150 million, and 0.40%
thereafter. Effective October 1, 1995, the
advisory fee will be 0.40%.
Administration Fee. Pacific Investment
Administrative
Services Company (the "Administrator"), an
affiliate of PIMCO, provides administrative
services to the Fund for which it receives a
monthly administrative fee at the annual rate of
0.10% of the Fund's average daily net assets.
Effective October 1, 1995, the Trust adopted a
"unified fee structure" whereby PIMCO provides
service necessary for the operations of the
Fund for a single administrative fee. The new
administrative fee is 0.25%.
Expenses. The Fund bears all costs of its
operations. Expenses directly attributable to
the Fund are charged to the Fund; other
expenses are allocated proportionately among all
the Funds of the Trust in relation to the net
assets of each Fund. Each unaffiliated
Trustee received an annual retainer of
$7,000, plus $2,000 for each Board of Trustees
meeting attended, plus reimbursement of
related expenses.
These expenses are allocated to the Funds of
the Trust according to their respective net
assets.
Expense Offset Arrangement. Fees paid
indirectly represent reductions in custody and
transfer agent expenses from interest income
earned on incidental uninvested cash balances.
Such fees have been added to custody and
transfer agent fees to reflect total Fund
expenses.
Expense Limitation. Prior to adoption of the
unified fee structure, the Advisor and the
Administrator, in the interest of limiting
expenses of the Fund, limited the expenses of
the Fund, including advisory and administrative
fees, to 0.65% of its average net assets on an
annual basis.
The cumulative unreimbursed amount as of
September 30, 1995 was $49,073. This amount has
been waived by the Adviser and Administrator as
a result of adopting the unified fee structure.
<PAGE> 12
Notes To Financial Statements (Cont.)
Related Party Transactions. PIMCO Advisors
Distribution Company ("PADCO"), an indirect
wholly-owned subsidiary of PIMCO Advisors
L.P., serves as the distributor of the Fund's
shares. Under the contract, all expenses
relating to the
distribution of Fund shares will be paid by the
Adviser, the Administrator or PADCO out of
past profits and resources which may include
fees received by the Adviser or the
Administrator.
3. Purchases and Sales of Securities
Purchases and sales of investment securities
(excluding short-term instruments) for the Fund
for the six months ended September 30, 1995
were as follows ($ in thousands):
Purchases Sales
U.S. Government Other U.S. Government Other
- $5,115 - $5,075
4. Shares Of Beneficial Interest
The Fund may issue an unlimited number of
shares of beneficial interest with a $.0001
par value. Changes in shares of
beneficial interest were as follows
(in thousands):
<TABLE>
<CAPTION>
Six months ended Period Ended
September 30,1995 March 31, 1995
<S> <C> <C>
Shares sold 0 500
Shares issued as
reinvestment of dividends 5 6
Shares redeemed 0 0
Net increase 5 506
</TABLE>
<PAGE> inside back cover
Trustees and Officers
Brent R. Harris, Chairman and Trustee
Guilford C. Babcock, Trustee
Vern O. Curtis, Trustee
Thomas P. Kemp, Trustee
William J. Popejoy, Trustee
R. Wesley Burns, President
Garlin G. Flynn, Secretary
John P. Hardaway, Treasurer
Investment Adviser and Administrator
Pacific Investment Management Company
840 Newport Center Drive, Suite 360
Newport Beach,California 92660
Transfer Agent and Custodian
Investors Fiduciary Trust Company
127 West 10th Street
Kansas City, Missouri 64105
Counsel
Dechert Price & Rhoads
1500 K Street N.W.
Washington, D.C. 20005
Independent Accoutants
Price Waterhouse LLP
1055 Broadway
Kansas City, MO 64105
This report is submitted for the general
information of the shareholders of the PIMCO
VersaSTYLE Equity Fund. It is not
authorized for distribution to prospective
investors unless accompanied or preceded by an effective
prospectus for the PIMCO Funds, which
contains information covering its investment
policies as well as other pertinent
information.
