SATURNA INVESTMENT TRUST
N-30D, 2000-07-27
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Sextant

Mutual Funds

(Graphic Omitted)

Fellow Shareowners:

Despite increasing interest rates, the longest U.S. economic expansion in history continues. Consumer confidence and employment are high. Rising incomes and stock market wealth, plus low inflation, are providing real power to the U.S. economy. Politicians debate how to spend government's surpluses.

The present economic environment is the best since World War II. This strong economy is bolstering earnings at companies in all sectors of the economy, from luxury retailers to basic construction. Technology is selling computers and digital applicances to homes as well as businesses. But the Federal Reserve is trying to slow growth with higher interest rates, and we don't expect future stock market returns to be as easy as they were during the last decade.

While in the midst of prosperity, prudent investors do well to remember that change is the only real constant. Today's calm economic seas will someday be disturbed by recessions, uncertainties and wars. This is the rational for our four distinctly different Sextant funds, which allow investors to choose the risks of the domestic and international stock markets or the safety of short-term bonds.

For the twelve months ended May 31st, we are pleased to report the International Fund has done exceptionally well, and beat its Morningstar* peer measurement by 13%. The Short-Term Bond Fund and Bond Income Fund both approximated their Morningstar peer categories. Only the Growth Fund, which was concentrated in volatile technology and financial issues, underperformed its peers.

Our Sextant Funds employ a "fulcrum" advisory fee structure that rewards or penalizes Saturna Capital for investment results. The four Funds pay increased or decreased monthly advisory fees depending on relative performance over the prior 12 months. For the twelve months ended May 31, 2000 comparative total returns are:

 
Sextant Fund
Total Return
vs. Morningstar
Total Return
Rank
Short-Term Bond
3.31%
Short-Term Bonds
2.96%
39 (217)
Bond Income
-1.61%
Long-Term Bonds
-0.85%
67 (120)
Growth
8.86%
Domestic Growth
17.53%
65 (232)
International
41.33%
Foreign Stock
28.18%
20 (661)

While our funds remain small, assets in the four funds are up over 50% from last May 31st. It has been an exciting year so far and we are looking forward to the second half. Thank you for investing with us.

 

Nicholas Kaiser, President Phelps McIlvaine, Vice President
(Manager, Sextant Growth;
Sextant International)		 (Manager, Sextant Bond Income;
Sextant Short-Term Bond)

* The 12-month Rank shows how each Fund ranks (from 1 best to 100 worst) in its Morningstar peer category for the year ended May 31, 2000 - please see page 10 for more performance information.

June 29, 2000

May 31, 2000 Semi-Annual Report  
1

 

(graphic omitted)SEXTANT SHORT-TERM BOND FUND  
INVESTMENTS

Rating* Issuer Coupon/Maturity Face Amount Market Value  
  Aerospace - Aircraft (3.5%)        
A McDonnell Douglas /Boeing Capital 9.25% 04/1/2002 $75,000 $76,582  
  Banking (5.7%)        
A+ Bank of America 9.375% 3/1/2001 50,000 50,295  
A- Bankers Trust-NY 9.50% 06/14/2000 75,000 74,752  
  SUB-TOTAL   125,000 125,047  
  Chemicals (2.8%)        
A- Praxair Inc. 6.15% 4/15/2003 65,000 61,042  
  Cosmetics & Toiletries (3.3%)        
BBB Dial Corporation 6.625% 6/15/2003 75,000 71,925  
  Finance (14.5%)        
A- Aristar Inc. 6.75% 8/15/2001 95,000 93,347  
A Deluxe Corp. 8.55% 2/15/2001 50,000 49,860  
BBB+ Finovia Capital Corp. 5.98% 2/27/2001 75,000 74,579  
A Traveller's Property and Casualty 6.75% 4/15/2001 100,000 98,560  
  SUB-TOTAL   320,000 316,346  
  Food (2.3%)        
A- Coca Cola Enterprises 7.875 2/1/2002 50,000 49,835  
  Oil & Gas (13.1)        
AA+ Amoco Canada 7.25% 12/1/2002 70,000 69,356  
A- Columbia Gas Corp. 6.61% 11/28/2002 50,000 48,130  
A- Fina Oil & Chemical 6.875% 7/15/2001 75,000 73,988  
BBB+ Union Oil of California 7.20% 5/15/2005 100,000 95,900  
  SUB-TOTAL   295,000 287,374  
  Life Insurance (4.4%)        
A+ Lincoln National Insurance 7.25% 5/15/2005 100,000 95,560  
  Investment Finance (6.8%)        
AA- Merrill Lynch & Co. 6.00% 1/15/2001 100,000 99,090  
A+ Morgan Stanley 9.375 6/15/2001 50,000 50,620  
  SUB-TOTAL   150,000 149,710  
  Machinery (3.1%)        
A- Ingersol Rand Corp 6.38% 11/19/2001 70,000 68,068  
  Medical - Health Maintenance Org. (3.1%)        
A- Aetna Services 6.75% 8/15/2001 70,000 68,565  
  Paper & Paper Products (4.2%)        
A Westvaco Corporation 9.65% 3/1/2002 90,000 92,286  
  Retailing (6.7%)        
A J.C.Penny & Co. 9.05% 3/1/2001 100,000 99,120  
BBB Safeway Corp. 6.05% 11/15/2003 50,000 46,525  
  SUB-TOTAL   150,000 145,645  
  Telecommunications (12.0%)        
A Northern Telecom 8.75% 6/12/2001 100,000 100,650  
BBB+ Sprint Capital Corp. 5.875% 5/1/2004 100,000 93,400  
BBB WorldCom Inc. 6.125% 8/1/2001 70,000 68,537  
  SUB-TOTAL   270,000 262,587  
  Transportation - Air Freight (2.6%)      
BBB Federal Express Corp. 9.875% 4/1/2002 55,000 56,276  
AAA U.S. Government (3.6%)        
  US Treasury Note 6.00% 8/15/2004 80,000 78,250  
  Total Investments (91.7%) (Cost = $1,796,201) $2,040,000 2,005,098  
  Other Assets (net of liabilities) (8.3%)   $182,440  
  Total Net Assets (100%)   $2,187,538  
  *Ratings are the lesser of S&P or Moody's        
2  
May 31, 2000 Semi-Annual Report
FINANCIAL HIGHLIGHTS  

SEXTANT SHORT-TERM BOND FUND (Graphic Omitted)


Selected data per share of capital stock outstanding throughout the period:            
      For the year ended November 30,
   

Six months ended
May 31, 2000

 1999 1998 1997 1996

Sept. 28, '95 (inception)
to Nov. 30, '95
Net asset value at beginning of period   $4.92 $5.04 $4.99 $5.00 $5.03 $5.00
  Income from investment operations              
    Net Investment Income 0.13 0.26 0.27 0.27 0.25 0.03
  Net gains or losses on securities            
    (both realized and unrealized) (0.04) (0.12) 0.05 (0.01) (0.03) 0.03
Total from investment operations   0.09 0.14 0.32 0.26 0.22 0.06
  Less distributions            
  Dividends (from net investment income) (0.13) (0.26) (0.27) (0.27) (0.25) (0.03)
  Distributions (from capital gains) 0.00 0.00 0.00 0.00 0.00 0.00
Total distributions   (0.13) (0.26) (0.27) (0.27) (0.25) (0.03)
Net asset value at end of period   $4.88 $4.92 $5.04 $4.99 $5.00 $5.03
Total Return   1.90% 2.88% 6.67% 5.45% 4.85% 1.05%
Ratios / Supplemental Data              
Net assets ($000), end of period   $2,188 $1,795 $1,908 $2,508 $2,016 $878
Ratio of gross expenses to average net assets*   0.31% 0.47% 0.48% 0.60% 0.85% 0.23%
Ratio of net investment income to average net assets*   2.67% 5.22% 5.57% 5.58% 6.30% 0.68%
Portfolio turnover rate   0% 18% 71% 47% 100% 0%
* For the above periods, all or a portion of the operating expenses were waived. If costs had not been waived, the resulting increase to expenses per share in each period would have been $.01, $ .03, $.02, $.02, .02 and $.007.
The increase to the ratio of expenses to average monthly net assets would be .21%, .57%, .44%, .40%, .52% and .16%, respectively.
* not annualized          

 

STATEMENT OF ASSETS AND LIABILITIES

As of May 31, 2000
Assets        
  Investments (Cost $2,099,537)   $2,005,098  
  Cash   144,391  
  Interest Receivable   38,608  
    Total Assets     $2,188,097
Liabilities        
  Other Liabilities   559  
    Total Liabilities     559
Net Assets      
$2,187,538
         
Fund Shares Outstanding       448,878
         
Analysis of Net Assets        
  Paid in Capital (unlimited shares authorized, without par value)   2,246,376  
  Accumulated net realized gain (loss) on investments   (11,357)  
  Unrealized net depreciation to Fund shares outstanding   (47,481)  
    Net Assets applicable to Fund shares outstanding     $2,187,538
         
Net Asset Value, Offering and Redemption price per share       $4.88

(The accompanying notes are an integral part of these financial statements)

May 31, 2000 Semi-Annual Report  
3
(Graphic Omitted) SEXTANT SHORT-TERM BOND FUND  

STATEMENT OF OPERATIONS


For the six months ended May 31, 2000    
       
Investment Income      
  Interest income $71,866  
  Amortization of bond premium (11,022)  
  Miscellaneous income 150  
  Accretion 134  
    Gross investment income   $61,128
       
Expenses      
  Investment Advisor and administration fee 6,099  
  Professional fees 1,609  
  Custodian fees 997  
  Filing and Registration fees 594  
  Printing and postage 637  
  Other expenses 658  
    Total gross expenses 10,594  
  Less: Advisory fees waived (3,304)  
  Less: Custodian fees waived (997)  
    Net expenses   6,293
    Net Investment income   54,835
       
Net realized gain on investments      
  Proceeds from sales 0  
  Less: Cost of securities sold (based on identified cost) 0  
    Realized net gain   0
       
Unrealized gain on investments      
  End of period (47,481)  
  Beginning of period (29,128)  
  Decrease in unrealized gain for the period   (18,353)
    Net realized and unrealized gain (loss) on investments   (18,353)
     
Net decrease in net assets resulting from operations     $36,482

(The accompanying notes are an integral part of these financial statements)

4  
May 31, 2000 Semi-Annual Report
STATEMENT OF CHANGES IN NET ASSETS  

SEXTANT SHORT-TERM BOND FUND (Graphic Omitted)


    Six months ended Year ended
    May 31, 2000 Nov. 30, 1999
INCREASE IN NET ASSETS      
Operations      
  Net investment income $54,835 $101,571
  Net realized gain on investments 0 (4,467)
  Net increase (decrease) in unrealized appreciation (18,353) (41,284)
  Net increase in net assets from operations 36,482 55,820
       
Dividends to Shareowners From      
  Net investment income (54,790) (100,085)
  Capital gains distributions 0 0
    Total Distributions (54,790) (100,085)
       
Fund Share Transactions      
  Proceeds from sales of shares 602,535 491,772
  Value of shares issued in reinvestment of dividends 54,701 99,952
    657,236 591,724
  Cost of shares redeemed (246,787) (660,061)
  Net increase (decrease) in net assets from share transactions 410,449 (68,337)
Total increase (decrease) in net assets   392,141 (112,602)
NET ASSETS      
  Beginning of period 1,795,397 1,907,999
  End of period 2,187,538 1,795,397
Shares of the fund sold and redeemed      
  Number of shares sold 123,099 98,002
  Number of shares issued in reinvestment of dividends 11,187 20,068
    134,286 118,070
  Number of shares redeemed (50,365) (131,961)
Net increase (decrease) in number of shares outstanding   83,921 (13,891)

(The accompanying notes are an integral part of these financial statements)

May 31, 2000 Semi-Annual Report  
5
(Graphic Omitted) SEXTANT BOND INCOME FUND  

INVESTMENTS


Rating Issuer Coupon/Maturity Face Amount Market Value
  Banking (16.2%)        
A- Chase Manhattan   7.125% 6/15/2009 $50,000 $47,150
A Citicorp   7.25% 10/15/2011 50,000 46,430
A- Comerica Bank   7.125% 12/1/2013 50,000 46,338
AA- Norwest Financial   6.85% 7/15/2009 50,000 46,310
    SUB-TOTAL   200,000 186,228
  Computer (2.4%)        
BBB Dell Computer   6.55% 4/15/2008 30,000 27,465
  Electric Utilities (7.8%)        
A+ Alabama Power   7.75% 2/1/2023 50,000 45,745
BBB Commonwealth Edison   7.50% 7/1/2013 50,000 44,455
    SUB-TOTAL   100,000 90,200
  Electronics (4.0%)        
BBB+ Phillips Electronics   7.25% 8/15/2013 50,000 45,605
  Insurance (4.0%)        
A Allstate   7.50% 6/15/2013 50,000 46,025
  Investment Finance (16.2%)        
A Lehman Brothers   9.75% 5/8/2007 50,000 50,484
A Bear Sterns   7.00% 3/1/2007 50,000 46,815
A Morgan Stanley Dean Witter   6.75% 10/15/2013 50,000 43,975
BBB Paine Webber Group   7.625% 2/15/2014 50,000 45,370
    SUB-TOTAL   200,000 186,644
  Leisure and Recreation (4.5%)        
BBB Hilton Hotels Corp   7.95% 4/15/2007 55,000 51,288
  Medical Supplies (3.3%)        
A+ Becton Dickinson Corp.   7.15% 10/1/2009 40,000 38,036
  Oil & Gas (3.6%)        
A Texaco Capital   8.625% 6/30/2010 40,000 41,845
  Paper & Paper Products (4.6%)        
A- Union Camp Corporation   9.25% 2/1/2011 50,000 53,125
  Retailing (4.1%)        
A Gap   6.90% 9/15/2007 50,000 46,725
  Telecommunications (12.9%)        
A- Bell Canada (Yankee)   9.5% 10/15/2010 50,000 55,175
A+ GTE   6.90% 11/1/2008 50,000 46,850
BBB WorldCom   6.40% 8/15/2005 50,000 46,675
    SUB-TOTAL   150,000 148,700
  Transportation (4.4%)        
A- US Freightways Corp.   8.50% 4/25/2010 50,000 51,019
           
Total Investments (88.0%)     Cost = $1,263,057 $1,065,000 1,012,905
Other Assets (net of liabilities) (12.0%)         138,863
Total Net Assets (100%)         $1,151,768

6  
May 31, 2000 Semi-Annual Report
FINANCIAL HIGHLIGHTS  

SEXTANT BOND INCOME FUND (graphic omitted)


Selected data per share of capital stock outstanding throughout each period            
    Six months ended Year ended November 30,  
    May 31, 2000 1999 1998 1997 1996 1995
Net asset value at beginning of period   $4.59 $5.00 $4.83 $4.76 $4.91 $4.39
  Income from investment operations            
  Net investment income 0.14 0.30 0.29 0.30 0.30 0.24
  Net gains or losses on securities            
    (both realized and unrealized) (0.19) (0.41) 0.17 0.07 (0.12) 0.52
Total from investment operations   (0.05) (0.11) 0.46 0.37 0.18 0.76
  Less distributions            
  Dividends (from net investment income)            
    Taxable (0.14) (0.30) (0.29) (0.30) (0.30) (0.24)
  Distributions (from capital gains) 0.00 0.00 0.00 0.00 (0.03) 0.00
Total distributions   (0.14) (0.30) (0.29) (0.30) (0.33) (0.24)
Net asset value at end of period   $4.40 $4.59 $5.00 $4.83 $4.76 $4.91
Total return   -1.03% -2.20% 10.08% 8.24% 4.04% 17.69%
Ratios/supplemental data              
Net assets ($000), end of period   $1,152 $885 $1,345 $1,092 $1,201 $1,096
Ratio of expenses to average net assets*   0.22% 0.40% 0.30% 0.47% 0.63% 0.54%
Ratio of net investment income to average net assets*   3.15% 6.31% 6.24% 6.85% 5.96% 5.15%
Portfolio turnover rate   0% 20% 0% 51% 75% 77%
               
* For each of the above periods, all or a portion of the operating expenses were waived. If these costs had not been waived,the resulting increases to expenses per share in each of the above periods would be $.02, $.01, $.03, $.03, $.03, and $.22, respectively. The increase to the ratio of expenses to average monthly net assets would be .35%, .66%, .61%, .63%, .70% and .60%.
*Data prior to September 28, 1995 may not be meaningful, as the fund operated with different investment objectives and fee arrangements.

STATEMENT OF ASSETS AND LIABILITIES

 
As of May 31, 2000      
Assets      
  Bond Investments (Cost $1,103,111) $1,012,905  
  Cash 116,789  
  Interest Receivable 20,828  
  Insurance Reserve Premium 1,221  
    Total Assets   $1,151,743
       
Liabilities      
  Other Liabilities (25)  
    Total Liabilities   (25)
Net Assets     $1,151,768
       
Fund Shares Outstanding     261,883
       
Analysis of Net Assets      
  Paid in Capital (unlimited shares authorized, without par value) 1,325,254  
  Accumulated net realized gain (loss) on investments (87,546)  
  Unrealized net appreciation to Fund shares outstanding (85,940)  
    Net Assets applicable to Fund shares outstanding   $1,151,768
Net Asset Value, Offering and Redemption price per share     $4.40

(The accompanying notes are an integral part of these financial statements)
May 31, 2000 Semi-Annual Report  
7

(graphic omitted) SEXTANT BOND INCOME FUND  

STATEMENT OF OPERATIONS

For the six months ended May 31, 2000    
Investment Income      
  Interest income $34,835  
  Amortization of bond premium (1,067)  
  Accretion 9  
  Miscllaneous income 8  
    Gross investment income   $33,785
Expenses      
  Investment advisor and administration fee 2,977  
  Professional fees 985  
  Filing and registration fees 445  
  Custodian fees 572  
  Printing and postage 380  
  Other expenses 409  
    Total gross expenses 5,768  
  Less: Advisor fees waived (2,977)  
  Less: Custodian fees waived (572)  
    Net expenses   2,219
    Net investment income   31,566
Net realized gain on investments      
  Proceeds from sales 0  
  Less: Cost of securities sold based on identified cost 0  
    Realized net gain   0
Unrealized gain on investments      
  End of period (85,940)  
  Beginning of period (45,045)  
  Decrease in unrealized gain for the period   (40,895)
    Net realized and unrealized gain (loss) on investments   (40,895)
Net increase in net assets resulting from operations     ($9,329)

STATEMENT OF CHANGES IN NET ASSETS

    Six months ended Year ended
    May 31, 2000 Nov. 30, 1999
Operations      
  Net investment income $31,566 $70,566
  Net realized gain on investments 0 (5,731)
  Net increase (decrease) in unrealized appreciation (40,895) (91,359)
  Net increase (decrease) in net assets from operations (9,329) (26,524)
       
Dividends to Shareowners From      
  Net investment income (31,566) (70,566)
  Capital gains distributions 0 0
    Total Distributions (31,566) (70,566)
       
Fund Share Transactions      
  Proceeds from sales of shares 348,997 156,861
  Value of shares issued in reinvestment of dividends 30,971 69,139
    379,968 226,000
  Cost of shares redeemed (72,562) (588,359)
  Net increase (decrease) in net assets from share transactions 307,406 (362,359)
Total increase (decrease) in net assets   266,511 (459,449)
NET ASSETS      
  Beginning of period 885,257 1,344,706
  End of period $1,151,768 $885,257
       
Shares of the fund sold and redeemed      
  Number of shares sold 78,434 32,908
  Number of shares issued in reinvestment of dividends 6,938 14,481
    85,372 47,389
  Number of shares redeemed (16,213) (123,698)
Net increase (decrease) in number of shares outstanding   69,159 (76,309)

(The accompanying notes are an integral part of these financial statements)

8  
May 31, 2000 Semi-Annual Report
INVESTMENTS  
SEXTANT GROWTH FUND (graphic omitted)

Issue Number of Shares Cost Market Value  
Common Stocks (88.7%)        
Banking (7.5%)        
Chase Manhattan 1,000 $85,433 $74,688  
Frontier Financial 4,000 90,207 68,000  
Washington Mutual 4,500 44,124 129,375  
  SUB-TOTAL   219,764 272,063  
Computers (29.9%)        
Adobe Systems 2,400 50,490 270,150  
Apple Computer* 2,000 67,473 168,000  
America Online* 1,160 14,457 61,480  
Artisoft* 4,000 87,662 41,500  
Intuit* 1,500 76,604 54,375  
3Com* 1,225 29,726 51,220  
Oracle* 5,400 37,879 388,125  
Phoenix Technologies Ltd.* 3,062 29,149 55,116  
  SUB-TOTAL   393,440 1,089,966  
Construction (2.2%)        
Building Materials Holding* 4,000 44,171 37,250  
Butler Manufacturing 2,000 43,529 44,625  
  SUB-TOTAL   87,700 81,875  
Electronics (.5%)        
FLIR Systems* 2,500 27,611 17,344  
Hotels & Motels (2.5%)        
Westcoast Hospitality* 12,000 92,520 93,000  
Investments (15.8%)        
Schwab (Charles) 20,415 9,117 578,000  
Machinery (.9%)        
Regal-Beloit 2,000 52,106 33,500  
Medical (14.4%)        
Affymetrix* 1,000 26,863 118,750  
Immunex* 8,400 48,438 217,350  
Ligand Pharmaceuticals 5,000 56,430 53,437  
Pharmaceutical Product Development 6,000 107,478 99,000  
Thermo Cardiosystems* 4,000 45,836 39,250  
  SUB-TOTAL   285,045 527,787  
Metal Ores (1.6%)        
Phelps Dodge 1,330 76,218 59,684  
Oil & Gas Production (7.4%)        
BP Amoco 1,476 51,620 80,257  
Noble Drilling* 2,000 14,212 86,750  
Williams Companies 2,500 79,972 103,906  
  SUB-TOTAL   145,804 270,913  
Publishing (1.2%)        
Wiley (John) & Sons, Class A* 2,400 47,112 42,750  
Retail (2.9%)        
Saks* 1,500 25,945 17,344  
Whole Foods Market* 2,500 74,348 86,875  
  SUB-TOTAL   100,293 104,219  
Transportation (1.9%)        
Airborne Freight 2,500 27,082 50,469  
Trinity Industries 800 22,658 17,650  
  SUB-TOTAL   49,740 68,119  
         
Total Investments (88.7%)   $1,586,470 3,239,220  
Other Assets (net of liabilities) (11.3%)     411,920  
Total Net Assets (100%)     $3,651,140  
         
*non-income producing        

(The accompanying notes are an integral part of these financial statements)

May 31, 2000 Semi-Annual Report  
9
(graphic omitted) SEXTANT GROWTH FUND  

FINANCIAL HIGHLIGHTS

Selected data per share of capital stock outstanding throughout each period          
    Six months ended   For the Year Ended Nov 30
    May 31, 2000 1999 1998 1997 1996 1995*
Net asset value at beginning of period   $12.68 $9.29 $9.58 $7.92 $7.42 $5.82
  Income from investment operations            
  Net investment income (0.03) (0.06) 0.02 0.01 0.00 (0.03)
  Net gains or losses on securities            
    (both realized and unrealized) 0.94 4.26 (0.09) 2.41 0.50 1.82
Total from investment operations   0.91 4.20 (0.07) 2.40 0.50 1.79
  Less distributions            
  Dividends (from net investment income) 0.00 (0.14) (0.02) (0.01) 0.00 0.00
  Distributions (from capital gains) 0.00 (0.67) (0.20) (0.73) 0.00 (0.19)
Total distributions   0.00 (0.81) (0.22) (0.74) 0.00 (0.19)
Net asset value at end of period   $13.59 $12.68 $9.29 $9.58 $7.92 $7.42
Total Return   7.18% 44.76% (0.97)% 30.30% 6.74% 30.76%
Ratios / Supplemental Data              
Net assets ($000), end of period   $3,651 $3,116 $2,139 $2,188 $1,616 $1,137
Ratio of gross expenses to average net assets*   0.45% 1.12% 0.66% 1.04% 0.95% 1.63%
Ratio of net investment income to average net assets*   -(0.19)% (0.50)% 0.19% (0.12)% 0.01% 0.45%
Portfolio turnover rate   6% 28% 41% 25% 32% 40%
               
               
* For 1996 and 1995 all or a portion of the operating expenses were waived. If these costs had not been waived, the resulting increase to expenses per share in each of these years would be $.00, and $.01, respectively. The increase to the ratio of expenses to average net assets would have been .00%, and .18%, respectively.
* Data prior to September 28, 1995 may not be meaningful, as the fund operated with different investment objectives and fee arrangements.

ADDITIONAL PERFORMANCE INFORMATION

Average Annual Returns (as of 3/31/2000, per regulatory requirement)
 
1 year
5 years
10 years
(Graphic Omitted)
Sextant Growth Fund
46.74% 25.11%***
15.66%***
 
Sextant International Fund
56.70% 20.15%*
NA
Sextant Short-Term Bond Fund
2.81%
4.94%
NA
Sextant Bond Income Fund
-1.26%
5.30%***
5.11%**

*Since inception, 9/28/95
*** fund changed investment objectives & policies on 9/28/95; results prior to that date may not be meaningful.

**since inception, 3/1/93

Performance data quoted in this report represents past performance and is no guarantee of future performance. The investment return and principal value of investments in the Fund fluctuate daily, and an investor's shares when redeemed may be worth more or less than the original cost. Morningstar, Inc. is an independent fund performance monitor. Rankings are determined monthly from total returns by Morningstar, by category as determined by Morningstar. The average total return for a category is determined by Saturna Capital, utilizing the Morningstar database. Results are shown for twelve months because of the Sextant Funds performance fee advisory structure.

(The accompanying notes are an integral part of these financial statements)

10  
May 31, 2000 Semi-Annual Report

SEXTANT GROWTH FUND  

STATEMENT OF ASSETS AND LIABILITIES (Graphic Omitted)

As of May 31, 2000      
Assets      
  Investments (Cost $1,586,470) $3,239,220  
  Cash 407,210  
  Dividends Receivable 1,108  
  Insurance Reserve Premium 1,214  
    Total Assets   $3,648,752
       
Liabilities      
  Other Liabilities (2,388)  
    Total Liabilities   (2,388)
       
Net Assets     $3,651,140
       
Fund Shares Outstanding     268,669
       
Analysis of Net Assets      
  Paid in Capital (unlimited shares authorized, without par value) $2,002,403  
  Accumulated net realized gain (loss) on investments (4,015)  
  Unrealized net appreciation to Fund shares outstanding 1,652,752  
  Net Assets applicable to Fund shares outstanding   $3,651,140
     
Net Asset Value, Offering and Redemption price per share     $13.59

 

STATEMENT OF OPERATIONS

For the six months ended May 31, 2000

      
         
Investment Income        
  Dividend income (Less Foreign Tax of $49)   $10,044  
    Gross Investment Income     $10,044
         
Expenses        
  Investment Advisor and administration fee   12,772  
  Professional fees   1,976  
  Custodian fees   1,177  
  Filing and Registration fees   471  
  Printing and postage   800  
  Other expenses   1,095  
    Total gross expenses   18,291  
  Less: Custodian fees waived   (1,177)  
    Net expenses     17,114
    Net investment income     (7,070)
         
Net realized gain on investments        
  Proceeds from sales   264,754  
  Less: cost of securities sold based on identified cost   326,915  
    Realized net gain (loss)     (62,161)
         
Unrealized gain on investments        
  End of period   1,652,752  
  Beginning of period   1,384,429  
  Increase in unrealized gain for the period     268,323
    Net realized and unrealized gain on investments     206,162
       
Net increase in net assets resulting from operations       $199,092

(The accompanying notes are an integral part of these financial statements)

May 31, 2000 Semi-Annual Report  
11

(Graphic Omitted) STATEMENT OF CHANGES IN NET ASSETS  

SEXTANT GROWTH FUND

    Six months ended Year ended
    May 31, 2000 Nov. 30, 1999
INCREASE IN NET ASSETS      
Operations      
  Net investment income (loss) ($7,070) ($13,204)
  Net realized gain (loss) on investments (62,161) 204,297
  Net increase in unrealized appreciation 268,323 738,243
  Net increase in net assets from operations 199,092 929,336
       
Dividends to Shareowners From      
  Net investment income 0 0
  Capital gains distributions 0 (178,055)
    0 (178,055)
       
Fund Share Transactions      
  Proceeds from sales of shares 545,027 394,426
  Value of shares issued in reinvestment of dividends 0 176,540
    545,027 570,966
  Cost of shares redeemed (209,029) (345,633)
  Net increase in net assets from share transactions 335,998 225,333
Total increase in net assets   535,090 976,614
       
NET ASSETS      
  Beginning of period 3,116,050 2,139,436
  End of period $3,651,140 $3,116,050
       
Shares of the fund sold and redeemed      
  Number of shares sold 37,137 32,100
  Number of shares issued in reinvestment of dividends 0 13,922
    37,137 46,022
  Number of shares redeemed (14,149) (30,447)
Net increase in number of shares outstanding   22,988 15,575

(The accompanying notes are an integral part of these financial statements)

12  
May 31, 2000 Semi-Annual Report
INVESTMENTS  

SEXTANT INTERNATIONAL FUND (Graphic Omitted)


Issue Number of Shares Cost Market Value Country
Common Stocks (87.7%)          
Banking and Financial (12.6%)          
Australia and New Zealand Bank ADR   500 $10,875 $17,375 Australia
Aegon NV ADR   1224 11,512 44,217 Netherlands
AXA ADS   300 16,116 21,975 France
Banco Bilbao Vizcaya ADS   1800 7,702 24,975 Spain
Hutchison Whampoa ADR   550 47,112 30,800 Hong Kong
ING Groep ADS   700 36,134 42,219 Netherlands
Toronto-Dominion Bank   1400 18,159 34,387 Canada
  SUB-TOTAL   147,610 215,948  
Building Materials (3.2%)          
C R H plc ADR   1500 15,661 26,625 Ireland
Hanson plc ADR   800 24,574 28,000 United Kingdom
  SUB-TOTAL   40,235 54,625  
Computers (20.5%)          
Business Objects ADS*   4000 19,570 320,000 France
Dassault Systems ADR   400 13,875 30,050 France
  SUB-TOTAL   33,445 350,050  
Consumer Products (2.3%)          
Coca-Cola Femsa ADS   1500 9,750 22,781 Mexico
Gucci Group   200 10,925 17,125 Italy
  SUB-TOTAL   20,675 39,906  
Country Funds (1.9%)          
Austria Fund   2000 16,784 19,500 Austria
Irish Investment Fund   900 10,237 12,544 Ireland
  SUB-TOTAL   27,021 32,044  
Electronics (1.1%)          
Sony ADR   200 23,077 18,238 Japan
Medical-Drugs (3.2%)          
Aventis ADS   508 15,859 32,480 France
Glaxo Wellcome plc ADR   400 9,800 22,525 United Kingdom
  SUB-TOTAL   25,659 55,005  
Metals & Mining (1.7%)          
Potash Corp of Saskatchewan   300 21,164 17,362 Canada
Rio Tinto plc ADS   200 11,375 12,288 United Kingdom
  SUB-TOTAL   32,539 29,650  
Oil & Gas Production (6%)          
Petroleum Geo-Services ADS*   1000 10,979 19,063 Norway
Repsol-YPF ADR   2000 43,592 42,125 Spain
Total ADR   500 21,864 39,469 France
  SUB-TOTAL   76,435 100,657  
Paper Products (4.6%)          
Fletcher Challenge Forests ADS*   2024 15,778 7,463 New Zealand
Fletcher Challenge Paper ADR   5000 40,284 54,687 New Zealand
Metso ADS*   1300 14,363 17,062 Finland
  SUB-TOTAL   70,425 79,212  
Photographic Equipment (3.6%)          
Canon, Inc ADR   1000 23,427 46,375 Japan
Fuji Photo Film ADR   400 10,050 14,400 Japan
  SUB-TOTAL   33,477 60,775  
           

May 31, 2000 Semi-Annual Report  
13

 

(Graphic Omitted)SEXTANT INTERNATIONAL FUND  

INVESTMENTS (CONT'D)

 

Issue Number of Shares Cost Market Value Country  
Real Estate (1.6%)            
Intrawest   1500 26,218 27,469 Canada  
Telecommunications (13.2%)            
BCE   900 15,830 20,700 Canada  
British Sky Broadcasting ADS   300 11,063 33,562 United Kingdom  
Gilat Satellite Networks Ltd*   300 12,353 24,169 Israel  
Nortel Networks   1413 82,968 76,302 Canada  
PT Indosat ADR   1000 20,952 10,688 Indonesia  
Tele Centro Sul Participacoes ADR   60 1,387 3,600 Brazil  
Tele Norte Leste Participacoes ADR   335 6,933 6,574 Brazil  
Telecommunicacoes de Sao Paulo ADR   300 6,933 7,613 Brazil  
Telefonica ADS*   394 5,125 23,985 Spain  
Telesp Celular Participacoes ADR   500 24,895 18,938 Brazil  
  SUB-TOTAL   188,439 226,131    
Transportation (6.6%)            
Air Canada*   6000 56,814 70,500 Canada  
DaimlerChrysler AG   251 16,406 13,538 Germany  
Desc ADR   700 19,649 8,487 Mexico  
Lan Chile ADS   2500 18,845 19,844 Chile  
  SUB-TOTAL   111,714 112,369    
Utilities-Electric (4.9%)            
Enel ADR*   800 35,372 36,000 Italy  
Enersis ADR   800 19,414 17,150 Chile  
Korea Electric Power ADS   2000 31,961 31,250 Korea  
  SUB-TOTAL   86,747 84,400    
Utilities-Gas (0.7%)            
Transport de Gas del Sur ADR   1500 18,807 11,531 Argentina  
             
Total Investments (87.7%)     $962,523 1,498,010    
Other Assets (net of liabilities) (12.3%)       209,589    
Total Net Assets (100%)       $1,707,599    
             
* Non-income producing            

 

14  
May 31, 2000 Semi-Annual Report

 

FINANCIAL HIGHLIGHTS  
SEXTANT INTERNATIONAL FUND (graphic omitted)

Selected data per share of capital stock outstanding throughout each period:            
      For the Year Ended November 30,  
   

Six months ended
May 31, 2000

 1999 1998 1997 1996 Sept. 28, '95 (Inception) to
Nov. 30, '95*
Net asset value at beginning of period   $8.32 $6.81 $6.61 $5.87 $4.99 $5.00
  Income from investment operations            
  Net investment income 0.55 0.13 0.04 0.06 (0.03) (0.02)
  Net gains or losses on securities (both realized and unrealized) 1.18 1.57 0.20 0.74 0.88 0.01
Total from investment operations   1.73 1.70 0.24 0.80 (0.91) (0.01)
  Less distributions            
  Dividends (from net investment income) 0.00 (0.12) (0.04) (0.06) 0.03 0.00
  Distributions (from capital gains) 0.00 (0.07) 0.00 0.00 0.00 0.00
Total distributions   0.00 (0.19) (0.04) (0.06) 0.03 0.00
Net asset value at end of period   $10.05 $8.32 $6.81 $6.61 $5.87 $4.99
Total return   20.79% 24.90% 3.57% 13.58% 18.16% (0.20)%
Ratios/supplemental data              
Net assets ($000), end of period   $1,708 $1,162 $881 $881 $695 $328
Ratio of expenses to average net assets*   0.49% 0.72% 1.16% 1.51% 1.80% 0.49%
Ratio of net investment income to average net assets*   5.24% 1.74% 0.54% 0.93% 0.60% 0.38%
Portfolio turnover rate   3% 17% 18% 9% 11% 12%
               
* For the year ended Nov. '96 and the period ended Nov. '95, all or a portion of the operating expenses were waived. If costs had not been have waived and directly assumed, the resulting increase to expenses per share in these periods would have been $.03 and $.01, respectively. The increase to the ratio of expenses to average monthly net assets would be .50% and .21 %, respectively.
* not annualized

(The accompanying notes are an integral part of these financial statements)

May 31, 2000 Semi-Annual Report  
15
(graphic omitted) SEXTANT INTERNATIONAL FUND  

STATEMENT OF ASSETS AND LIABILITIES

       
As of May 31, 2000      
       
Assets      
  Bond Investments (Cost $962,523) $1,498,010  
  Cash 192,497  
  Dividends Receivable 17,180  
    Total Assets   $1,707,687
       
Liabilities      
  Other Liabilities 88
    Total Liabilities 88
       
Net Assets     $1,707,599
       
Fund Shares Outstanding     169,858
       
Analysis of Net Assets      
  Paid in Capital (unlimited shares authorized, without par value) 1,163,464  
  Accumulated net realized gain (loss) on investments 8,648  
  Unrealized net appreciation to Fund shares outstanding 535,487  
    Net Assets applicable to Fund shares outstanding   $1,707,599
       
Net Asset Value, Offering and Redemption price per share     $10.05

STATEMENT OF OPERATIONS

For the six months ended
May 31, 2000

      
       
Investment Income      
  Dividend income (net Foreign Tax of $1,411) $94,338  
    Gross investment income   $94,338
Expenses      
  Investment Advisor and administration fee 5,310  
  Custodian fees 1,392  
  Professional fees 964  
  Filing and Registration fees 671  
  Printing and postage 943  
  Other expenses 239  
  Total gross expenses 9,519  
  Less: Custodian fees waived (1,392)  
    Net expenses   8,127
    Net investment income   86,211
Net realized gain on investments      
  Proceeds from sales 55,710  
  Less: Cost of securities sold based on identified cost 46,982  
    Realized net gain   8,728
Unrealized gain on investments      
  End of period 535,487  
  Beginning of period 407,644  
  Increase in unrealized gain for the period   127,843
    Net realized and unrealized gain on investments   136,571
       
Net decrease in net assets resulting from operations     $222,782

(The accompanying notes are an integral part of these financial statements)

16  
May 31, 2000 Semi-Annual Report
SEXTANT INTERNATIONAL FUND  

STATEMENT OF CHANGES IN NET ASSETS (graphic omitted)

    Six months ended Year ended
    May 31, 2000 Nov. 30, 1999
INCREASE IN NET ASSETS      
Operations      
  Net investment income $86,211 $17,043
  Net realized gain on investments 8,728 18,185
  Net increase in unealized appreciation 127,843 189,914
  Net increase in net assets from operations 222,782 225,142
       
Dividends to Shareowners From      
  Net investment income 0 (15,861)
  Capital gains distributions 0 (9,571)
    0 (25,432)
       
Fund Share Transactions      
  Proceeds from sales of shares 412,913 181,757
  Value of shares issued in reinvestment of dividends 0 25,274
    412,913 207,031
  Cost of shares redeemed (90,376) (125,211)
  Net increase in net assets from share transactions 322,537 81,820
Total increase in net assets   545,319 281,530
       
NET ASSETS      
  Beginning of period 1,162,280 880,750
  End of period $1,707,599 $1,162,280
       
Shares of the fund sold and redeemed      
  Number of shares sold 33,212 24,655
  Number of shares issued in reinvestment of dividends 0 3,038
    33,212 27,693
  Number of shares redeemed (9,265) (17,375)
Net increase in number of shares outstanding   23,947 10,318
(The accompanying notes are an integral part of these financial statements)

May 31, 2000 Semi-Annual Report  
17

 

Notes to Financial Statements

Note 1 -Organization
Saturna Investment Trust (the "Trust") was established under Washington State Law as a Business Trust on February 20, 1987. The Trust is registered as a no-load, open-end series investment company under the Investment Company Act of 1940, as amended. Five portfolio series have been created to date: Sextant Short-Term Bond Fund, Sextant Bond Income Fund, Sextant Growth Fund, and Sextant International Fund (the "Funds"), and Idaho Tax-Exempt Fund, distributed through a separate prospectus and the results of which are contained in a separate report.

Note 2 -Significant Accounting Policies
The following is a summary of the significant accounting policies followed by the Funds.

Investments:
Securities traded on a national exchange or the national over-the-counter market system are valued at the last sale price or, in the absence of any sale on that date, the closing bid price. Other securities traded in the over-the-counter market are valued at the last bid price. Fixed-income securities for which there are no publicly available market quotations are valued using a matrix based on maturity, quality, yield and similar factors, which are compared periodically to multiple dealer bids and adjusted by the adviser under policies established by the Trustees.

The cost of securities is the same for accounting and Federal income tax purposes. Securities transactions are recorded on trade date. Realized gains and losses are recorded on the identified cost basis.

Income and Expenses:
Interest income is reduced by the amortization of bond premiums, on a constant yield-to-maturity basis from purchase date to maturity. Interest income is increased by accretion only for bonds underwritten as original issue discounts. Market discounts are recorded as realized gains upon disposition. Cash dividends from equity securities are recorded as income on the ex-dividend date.

Expenses incurred by the Trust on behalf of the Funds (e.g., professional fees) are allocated to the Funds on the basis of relative daily average net assets. The Adviser has agreed to certain limits on expenses, as described below.

Income taxes:
The Funds have elected to be taxed as regulated investment companies under the Internal Revenue Code and distribute substantially all of their taxable net income

and realized net gains on investments. Therefore, no provision for Federal income taxes is required.

Dividends and distributions to shareowners:
Dividends and distributions to shareowners are recorded on the ex-dividend date. For the Sextant Short-Term Bond Fund and Sextant Bond Income Fund, dividends are paid daily and distributed on the last business day of each month. For the Sextant Growth Fund and Sextant International Fund, dividends are payable at the end of each November. Shareowners electing to reinvest dividends and distributions purchase additional shares at the net asset value on the payable date.

18  
May 31, 2000 Semi-Annual Report

 

Note 3 -Transactions with Affiliated Persons
Under a contract approved by shareowners on September 28, 1995, Saturna Capital Corporation provides investment advisory services and certain other administrative and distribution services to conduct Trust business. Each of the Funds pays the Adviser a base Investment Advisory and Administrative Services Fee of .60% of average net assets per annum, payable monthly. The base Advisory Fee is subject to adjustment up or down depending on the investment performance of the Fund relative to a specified index. No performance adjustment is applicable during the first year any Agreement is in place. The Adviser has voluntarily undertaken to limit expenses of Sextant Bond Income Fund and Sextant Short-Term Bond Fund to 0.60% through March 31, 2001 and waives its investment advisory and administrative fee as to either Fund completely so long as assets of that Fund are less than $2 million.


For the six months ended May 31, 2000, Sextant Bond Income Fund and Sextant Growth Fund incurred advisory expenses of $2,977 and $12,772, respectively. Sextant International Fund incurred advisory expenses of $5,310 and Sextant Short-Term Bond Fund incurred advisory expenses of $6,099.

In accordance with the expense waiver noted above, for the six months ended May 31, 2000, Saturna Capital waived $3,304 of the Sextant Short-Term Bond Fund advisory fee and $2,977 of that of Sextant Bond Income Fund.

In accordance with the expense waiver noted above, for the six months ended May 31, 2000, Saturna Capital waived $3,304 of the Sextant Short-Term Bond Fund advisory fee and $2,977 of that of Sextant Bond Income Fund.

The Trust acts as a distributor of its own shares, except in those states in which Investors National Corporation (a subsidiary of Saturna Capital Corporation) is itself registered as a broker-dealer and acts as distributor without compensation.

Investors National Corporation is the primary stockbroker used to effect portfolio transactions for Sextant Growth Fund and Sextant International Fund, and was paid $1,078 and $985, respectively in commissions at discount rates during the six months ended May 31, 2000.

 

 
May 31, 2000 Semi-Annual Report  
19

 

Web: http://www.saturna.com
E-mail: [email protected]

 

 

(logo)

Saturna Capital
Mutual Funds

 

1300 N. State Street
Bellingham WA 98225-4370

1-800/SATURNA
(800/728-8762)

This report is issued for the information of the shareoweners of the Fund. It is not authorized for distribution to prospective investors unless it is accompanied or preceded by an effective prospectus relating to the securities of the Fund. Idaho Tax-Exempt Fund is a series of Saturna Investment Trust.

 

SEXTANT
Mutual Funds
(graphic omitted)

 

 

SHORT-TERM BOND

BOND INCOME

GROWTH

INTERNATIONAL

 

 

SEMI-ANNUAL REPORT
May 31, 2000

 



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