--------------
EQUITY FUNDS
--------------
BALANCED GROWTH FUND
GROWTH AND INCOME FUND
EQUITY INDEX FUND
GROWTH FUND
SPECIAL GROWTH FUND
EMERGING GROWTH FUND
MICROCAP FUND
INTERNATIONAL EQUITY FUND
ANNUAL REPORT
OCTOBER 31, 1998
(LOGO)FIRSTARFUNDS
<PAGE>
- --------------------------------------------------------------------------------
NOTICE TO INVESTORS
- - Shares of Firstar Funds:
- ARE NOT INSURED BY THE
FDIC, the US Government or any
other governmental agency;
- are not bank deposits or obligations
of or guaranteed by Firstar Bank, its parent company or its affiliates;
- are subject to investment risks,
including possible loss of principal; and
- are offered by B.C. Ziegler and Company, member NASD, SIPC, and an
independent third-party distributor.
- - Firstar Bank affiliates serve as investment adviser, custodian, transfer
agent, administrator, and accounting services agent and receive compensation
for such services as disclosed in the current prospectus.
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
Page(s)
SHAREOWNER LETTER........................................................1-3
FIRSTAR BALANCED GROWTH FUND.............................................4-5
FIRSTAR GROWTH AND INCOME FUND...........................................6-7
FIRSTAR EQUITY INDEX FUND................................................8-9
FIRSTAR GROWTH FUND.....................................................10-11
FIRSTAR SPECIAL GROWTH FUND.............................................12-13
FIRSTAR EMERGING GROWTH FUND............................................14-15
FIRSTAR MICROCAP FUND...................................................16-17
FIRSTAR INTERNATIONAL EQUITY FUND.......................................18-19
STATEMENT OF ASSETS AND LIABILITIES.....................................20-21
STATEMENT OF CHANGES IN NET ASSETS......................................22-24
FINANCIAL HIGHLIGHTS....................................................25-32
STATEMENT OF OPERATIONS.................................................33-34
SCHEDULE OF INVESTMENTS.................................................35-61
NOTES TO THE FINANCIAL STATEMENTS.......................................62-69
REPORT OF INDEPENDENT ACCOUNTANTS.........................................70
<PAGE>
(LOGO)FIRSTARFUNDS
DEAR SHAREOWNER: December 1998
INVESTMENT REVIEW
U.S. financial markets gave investors a roller coaster ride in the second half
of Firstar Funds' October fiscal year. Russia's devaluation of the ruble and
subsequent default on its debt set off a wave of selling in August that
culminated in a stunning 513 point decline in the Dow Jones Industrial Average
on August 31st. After rebounding somewhat in September, major market indexes
like the Dow and the Standard & Poor's 500 again flirted with bear market
territory in early October, declining nearly 20% from their July peak. Hardest
hit was the small company sector of the market, which as of the October 8th low,
was off nearly 38% from its April high as measured by the Russell 2000 Index.
Since that time, U.S. stock markets have staged a breathtaking rally, aided in
large part by the Federal Reserve's three successive quarter point interest rate
cuts on September 29th, October 15th and November 17th.
The shift in Federal Reserve policy to a lower interest rate, rapid money growth
posture is aimed at improving market liquidity and heading off a "credit
crunch." Following the near collapse of hedge fund company Long-Term Capital
Management, Inc., credit spreads (the difference in yield between a corporate
bond and a U.S. Treasury bond of equal maturity) widened dramatically and the
corporate bond market seized-up. Since the Fed began lowering interest rates,
credit spreads have narrowed and the market has absorbed new corporate bond
offerings from issuers who would have met a very chilly reception several weeks
ago. The direction of short-term interest rates reflects the Fed's actions,
with three-month Treasury bill yields declining from 5.0% to 4.3% between April
30th and October 31st. Long-term interest rates also declined during this
period, but were much more volatile than short-term rates. The yield on the
thirty-year U.S. Treasury bond declined from 6.0% to a low of 4.7% in September
before settling back at 5.2% at the end of October.
During volatile times like these, a consistent investment approach is the key to
success. Instead of trying to time the market and running the risk of zigging
when you should zag, we believe investors should stick to their long-term asset
allocation strategy. A consistent approach to asset allocation improves the
chances of turning investment returns into investor returns. Equally important
to long-term success, we believe, is following a consistent investment
philosophy or style. Although Firstar Funds offers actively managed stock
portfolios across the market capitalization spectrum and bond portfolios across
the maturity range, our investment philosophy is focused. We follow a high-
quality, structured approach in the management of our fixed-income portfolios
and a growth-at-a-reasonable-price approach in the management of our equity
portfolios. By staying focused on these twin investment disciplines, we believe
we increase our chances of winning the investment "marathon." We are pleased
with the long-term investment results our approach has achieved and remain
confident in our ability to deliver competitive returns in the future.
On the technology front, we continue to enhance our web site at
www.firstarfunds.com. Most recently, we added transactional capabilities. Now
you can purchase and redeem shares on-line, as well as exchange or transfer
assets between your existing Firstar Fund accounts. You now have the freedom to
access your accounts when it best suits your schedule - seven days a week, 24-
hours a day.
In other news, we reopened Firstar MicroCap Fund for new investments on November
2nd. Once the Fund receives an additional $50 million in contributions, it will
once again close. We reopen the Fund when we feel there is sufficient capacity
to absorb new assets. We are enthusiastic about the outlook for microcap
investing given the tremendous relative values we believe are available among
the market's smallest company stocks.
For more information about on-line transactions or if you have questions
regarding the reopening of Firstar MicroCap Fund, please call the Firstar Funds
Center at 1-800-982-8909.
Finally, we're very pleased at the appointment of Marian Zentmyer, CFA, as chief
equity investment officer. She replaced Scott Harkness, who left the firm in
November. Marian has 17 years of investment management experience with Firstar
and has received national publicity for her outstanding portfolio management
skills.
<PAGE>
(LOGO)FIRSTARFUNDS
MARKET OUTLOOK
Looking ahead, our market forecast is predicated on the following trends:
- -Representing 45% of global economic activity, the U.S. and Europe will combine
to offset the collapse suffered by many emerging economies, producing a net
gain in worldwide economic growth.
- -Despite Japan's efforts to reform its banking industry and implement new
measures to stimulate demand, such as lower tax rates and deficit spending by
the government, the Japanese economy remains mired in recession.
- -Economic policies prescribed by the International Monetary Fund (IMF), which
include tax increases, government spending cuts and devalued currencies, will
delay economic recovery in those countries infected by the "Asian Contagion."
- -Deterioration in foreign trade will continue to have a negative impact on U.S.
economic growth due to weakened international demand for U.S. exports and
higher imports from countries with devalued currencies.
- -The lowest mortgage rates in a generation, moderate job creation and the best
inflation-adjusted personal income growth in twenty-five years will sustain
today's high level of consumer spending gains and extend America's consumer-
led economic expansion.
- -Unable to raise prices due to fierce global competition, companies will
continue to "buy" revenue growth by acquiring their competitors (the urge to
merge).
- -Under pressure from rising wages and slowing sales growth, companies will
continue to restructure, improve productivity through technology and pare
payrolls (the urge to purge) to maintain profits.
- -Global overcapacity in manufacturing and commodity production (e.g. autos and
oil) should continue to exert downward pressure on commodity prices.
- -Inflation rates should continue to decline with a period of mild deflation in
1999 a strong possibility.
- -The yield curve, which plots interest rates from short-term to long-term, will
become more positively sloped (via lower short-term rates), prompting a swift
reduction in money market yields.
- -With earnings growth more difficult to achieve, the key to future stock market
returns will continue to be expanding price-to-earnings ratios (P/E's).
- -P/E's should expand in a disinflationary/deflationary environment because
stock prices are expressed in current dollars while earnings are expressed in
future dollars that are appreciating in terms of purchasing power.
<PAGE>
(LOGO)FIRSTARFUNDS
IN SUMMARY
We believe the global economy will muddle through this turbulent period with the
U.S. functioning as the "importer of last resort" and U.S. consumers providing
the engine for continued economic growth. A withering corporate profit outlook
makes stock selection critical and favors our active, growth-at-a-reasonable
price equity management strategy. Lower levels of inflation or modest deflation
increase the likelihood of further interest rate declines, creating a favorable
environment for fixed income investing. Although volatility will remain high,
we are optimistic for continued positive returns for both our equity and fixed-
income funds going into 1999.
We appreciate your confidence in the Firstar Funds and encourage you to read the
portfolio reviews that follow.
(PHOTO) (PHOTO)
MARY ELLEN STANEK, CFA MARIAN ZENTMYER, CFA
President and Chief Equity Investment Officer
Chief Executive Officer
Firstar Investment Research & Management Company, LLC (FIRMCO)
<PAGE>
(LOGO)FIRSTARFUNDS
- --------------------------------------------------------------------------------
BALANCED GROWTH FUND
- --------------------------------------------------------------------------------
The fiscal year ended October 31, 1998 culminated a year in which the world
financial markets collapsed. The "Asian Contagion" that began the fiscal year
in the Fall of 1997 spread to Latin America and Russia during the summer of
1998. The Russian government's decision to devalue the Ruble unleashed a deluge
of selling in world markets that continues to unwind. The return of one's money
became far more important than the return on one's money. Treasury securities
staged a spectacular rally as a massive flow of funds sought quality. Concerns
about U.S. vulnerability to recession and the associated company earnings risk
removed the halo the stock market had been wearing for the last three and a half
years. Liquidity for small stocks and lower quality corporate debt evaporated
which created an enormous divergence in returns between mega cap stocks
(companies with market capitalizations greater than $25 billion) and small cap
stocks (companies with market capitalizations less than $1 billion).
In light of this volatility, the S&P 500 was up 22% while the S&P 600 declined
11%. This divergence of returns had an impact on your Fund as the equity
portion of the portfolio had an above market weight position in smaller
companies at 44%. Firstar Balanced Growth Fund was up +8.8% (+8.6% Retail no-
load) for the year, trailing the average balanced fund at +10.8% as measured by
Lipper Analytical Services.
In the equity portion of your portfolio, we have maintained large positions in
the consumer cyclical and finance sectors for several years. Although this
emphasis has enhanced longer term results of the portfolio, it also penalized
short-term results during the last twelve months as investors became concerned
about lack of economic growth and the repercussions of world financial problems
on our domestic markets. We continue to believe that the U.S. consumer, aided
by the Federal Reserve's lower interest rate and rapid money growth policies,
will lead the economy to modest growth for 1999.
Technology stocks advanced 34% for the year led by the stalwarts: Dell,
Microsoft, Intel and Cisco Systems, all of which were held in your portfolio.
While the outlook for technology is somewhat clouded by the impact of spending
to fix the "year 2000" problem, we remain bullish on the longer term outlook for
this important sector of the market. Finally, in the consumer staples sector,
healthcare was up +41% over the last twelve months, and should continue to be a
beneficiary of record new drug approvals, expanded pharmaceutical coverage and
aging demographics. As such, we remained over-weighted in this area. See page
35 for a complete listing of portfolio holdings.
We believe the key to future stock market returns will continue to be expanding
price-to-earnings ratios. During the last twelve months, earnings forecasts for
the S&P 500 declined 12%, yet the market value of the index has advanced 22%.
The higher valuation is a rational result of lower inflation expectations more
than offsetting the decline in earnings estimates. Our outlook is for flat
corporate profits in 1999 with a further decline of interest rates.
The objective of the fixed-income component of Firstar Balanced Growth Fund is
to provide an annual rate of total return comparable to the return of the Lehman
Brothers Government/Corporate Bond Index. More than half (51%) of the fixed-
income portion of the Fund is invested in U.S. Treasury bonds which was the
strongest performing sector of the bond market over the last twelve months. Our
careful, research-intensive process of selecting investment-grade corporate
issues and asset-backed securities gives the Fund a high-quality focus. Nearly
three-quarters (73%) of the fixed-income portion of the Fund is invested in
obligations rated Aaa/AAA or higher. Among corporate bonds, we have a
preference for finance, banking and brokerage issues along with dollar-
denominated international ("Yankee") securities. We think these sectors
represent exceptional value in the current environment. Since the Fund's
inception in 1992, we have adhered to the same disciplined management approach.
Although the past six+ years have brought us more volatility in the fixed-income
markets than many would have expected, the hallmark of our fixed-income approach
has been our consistent, risk-controlled approach in all market climates.
We appreciate your continued confidence in Firstar Balanced Growth Fund and look
forward to working with you in the future.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
MARIAN E. ZENTMYER, CFA, CFP, Chief Equity Investment Officer of Firstar
Investment Research & Management Company, LLC (FIRMCO) and TERESA R. WESTMAN,
CFA, Senior Portfolio Manager co-manage the Fund, Teresa since its inception on
March 30, 1992, and Marian since June 18, 1996. Marian has been with Firstar
since 1982 and has 20 years of investment management experience. She received
her BA from Stanford University in 1978. Teresa has been with Firstar since 1987
and has 11 years of investment management experience. Teresa received her BA
from Augustana College in 1985 and her MBA from the University of Chicago in
1991. Marian is a Chartered Financial Analyst and a Certified Financial Planner.
Teresa is a Chartered Financial Analyst.
(PHOTO) (PHOTO)
MARIAN E. ZENTMYER, TERESA R. WESTMAN, CFA
CFA, CFP
<PAGE>
(LOGO) FIRSTARFUNDS
<TABLE>
<CAPTION>
3/30/92 10/92 10/93 10/94 10/95 10/96 10/97 10/98
-------- -------- -------- -------- -------- -------- -------- --------
<C> <C> <C> <C> <C> <C> <C> <C>
FIRSTAR BALANCED GROWTH
INSTITUTIONAL FUND $10,000 $10,372 $11,771 $11,662 $13,969 $15,724 $18,615 $20,260
FIRSTAR BALANCED GROWTH
FUND - NO LOAD $10,000 $10,372 $11,771 $11,662 $13,941 $15,655 $18,484 $20,074
FIRSTAR BALANCED GROWTH
FUND - LOA $9,600 $9,958 $11,302 $11,197 $13,386 $15,032 $17,748 $19,271
LIPPER BALANCED FUND INDEX $10,000 $10,481 $12,167 $12,093 $14,220 $16,281 $19,553 $21,657
S&P 500 $10,000 $10,548 $12,124 $12,593 $15,923 $19,760 $26,106 $31,846
</TABLE>
This chart assumes an initial investment of $10,000 made on 3/30/92 (inception).
Per form ance reflects fee waivers in effect. In the absence of fee waivers,
total return would be reduced. Returns shown include the reinvestment of all
dividends and other distributions. Past performance is not predictive of future
performance. Investment return and principal value will fluctuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
<TABLE>
<CAPTION>
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
Since Inception
1 Year 3 Years 5 Years 3/30/92
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C>
FIRSTAR BALANCED GROWTH FUND - INSTITUTIONAL 8.8 13.2 11.5 11.3
FIRSTAR BALANCED GROWTH FUND - A - NO LOAD 8.6 12.9 11.3 11.2
FIRSTAR BALANCED GROWTH FUND - A - LOAD<F1> 4.3 11.4 10.4 10.5
LIPPER BALANCED FUND INDEX<F2> 10.8 15.1 12.3 12.5
S&P 500 STOCK INDEX<F3> 22.0 26.0 21.3 19.2
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
<F1> Reflects maximum sales charge of 4.00%. Effective January 1, 1999 the
maximum sales charge will be 4.50%.
<F2> The Lipper Balanced Fund Index is composed of the 30 largest mutual Funds
whose primary objective is to conserve principal by maintaining a balanced
portfolio of stocks and bonds.
<F3> The S&P500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic common
stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A (retail) shares and Series Institutional shares. Series A shares,
unlike the Series Institutional shares, have a 4% maximum sales load and are
subject to an annual 0.25% service organization fee. The load performance for
the Series A Shares has been restated to reflect the impact of the sales charge.
Series A performance prior to January 10, 1995, does not reflect the service
organization fees. If service organization fees had been reflected, performance
would be reduced. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/98
- ---------------------------------------
TYCO INTERNATIONAL, LTD. 1.5%
- ---------------------------------------
THE CHARLES SCHWAB CORPORATION 1.3%
- ---------------------------------------
SUNGARD DATA SYSTEMS, INC. 1.2%
- ---------------------------------------
PROTECTIVE LIFE CORPORATION 1.1%
- ---------------------------------------
MCI WORLDCOM, INC. 1.0%
- ---------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/98
- ---------------------------------------
$247,779,756
- ---------------------------------------
<PAGE>
(LOGO) FIRSTARFUNDS
- --------------------------------------------------------------------------------
GROWTH AND INCOME FUND
- --------------------------------------------------------------------------------
Firstar Growth and Income Fund's fiscal year ended October 31, 1998 witnessed
one of the most volatile periods in market history. The month of September
alone had 10 days where the market moved up or down more than 1%. We witnessed
two corrections in the S&P 500 during the past fifteen months. The first was in
October of 1997. Most recently, the S&P 500 fell over 20% between July 17 and
August 31, 1998 - the technical definition of a bear market. Despite this
volatility, the Growth and Income Fund returned positive results of +18.8%
(+18.1% Retail no-load) while the S&P 500 was up +22.0% and the Lipper Growth &
Income Index was up +9.45% for the same time period.
Our Growth style of investing involves purchasing companies that are growing
sales and earnings at a greater rate than the average company. This technique
fared well during the fiscal year as cyclical companies suffered from a lack of
demand and foreign competition. Also, aiding performance was the strong
relative performance of large capitalization companies versus small
capitalization companies. The average weighted market capitalization of the
Growth and Income Fund was $28 billion on October 31, 1998.
We have maintained our overweighted positions in consumer cyclicals and
financials, combining to represent 32% of the portfolio. This emphasis hurt the
relative performance of the Growth and Income Fund as investors became concerned
about a collapse in the financial markets and the consequences of lower consumer
spending and credit quality; however, we saw a change in mood in late October.
The Federal Reserve's decision to lower interest rates 0.25% on October 15th
signaled a heightened concern and willingness to provide needed liquidity to the
financial markets. We believe continued strong job availability, lower interest
rates, and declining prices on imported goods will continue to drive consumer
spending. The market volatility has created opportunities to purchase quality
companies at more reasonable prices, and over the past 12 months we added the
following new positions:
Albertson's - One of the largest supermarket chains in the U.S. We believe the
company should benefit from the recent acquisition of American stores as they
leverage the benefits of centralized purchasing and distribution.
Medtronic - One of the world's largest makers of implantable biomedical devices.
The company's primary focus is on products which improve cardiovascular and
neurological health.
Clorox - Best known for its name brand bleach - however, other market leading
brands include Kingsford Charcoal, S.O.S., Pine Sol and Black Flag.
Warner Lambert - A leading global marketer of prescription drugs including
Lipitor which lowers cholesterol and is rapidly gaining market share in this key
therapeutic category. The company also manufactures well known over-the-counter
products including Neosporin, Sudafed and Listerine. See page 40 for a complete
listing of portfolio holdings.
As 1999 approaches, we continue to be conservative on the outlook for the
financial markets. We believe interest rates (the main driver of price-to-
earnings ratios), will continue to fall due to the lack of any inflationary
pressure (higher labor rates offset by declining raw materials costs). Although
corporate profits will struggle as companies find it difficult to pass through
higher labor rates, higher price-to-earnings ratios with flattish earnings can
lead to modestly higher common stock prices.
We continue to adhere with our proven buy and sell disciplines and believe
Firstar Growth and Income Fund will continue to prove an attractive investment
for shareowners. We thank you for your continued participation and support.
PORTFOLIO MANAGER PROFILE
- -------------------------------------------------------------------------------
MARIAN E. ZENTMYER, CFA, CFP, Chief Equity Investment Officer of Firstar
Investment Research & Management Company, LLC (FIRMCO) and WALTER DEWEY, CFA,
Vice President and Senior Portfolio Manager co-manage the Fund, Marian since
February 22, 1993 and Walter since June 29, 1998. Marian has been with Firstar
since 1982 and has 20 years of investment management experience. She received
her BA from Stanford University in 1978. Walter has been with Firstar since 1986
and has 14 years of investment management experience. He received his BBA in
1983 from the University of Wisconsin. Marian is a Chartered Financial Analyst
and a Certified Financial Planner. Walter is a Chartered Financial Analyst.
(PHOTO) (PHOTO)
MARIAN E. ZENTMYER, WALTER DEWEY, CFA
CFA, CFP
<PAGE>
(LOGO)FIRSTARFUNDS
<TABLE>
<CAPTION>
12/29/89 10/90 10/91 10/92 10/93 10/94 10/95 10/96 10/97 10/98
-------- -------- -------- -------- -------- -------- -------- -------- ------- ------
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FIRSTAR GROWTH & INCOME
INSTITUTIONAL FUND $10,000 $9,304 $11,688 $12,368 $13,596 $13,846 $17,307 $21,963 $28,734 $34,008
FIRSTAR GROWTH & INCOME
FUND - NO LOAD $10,000 $9,304 $11,688 $12,368 $13,596 $13,846 $17,273 $21,870 $28,534 $33,693
FIRSTAR GROWTH & INCOME
FUND - LOAD $9,600 $8,933 $11,223 $11,875 $13,054 $13,294 $16,585 $20,999 $27,397 $32,345
S&P 500 $10,000 $8,855 $11,821 $12,999 $14,941 $15,519 $19,622 $24,351 $32,170 $39,244
</TABLE>
This chart assumes an initial investment of $10,000 made on 12/29/89
(inception). Per formance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Returns shown include the reinvestment
of all dividends and other distributions. Past performance is not predictive of
future performance. Investment return and principal value will fluctuate, so
that your shares, when redeemed, may be worth more or less than their original
cost.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
Since Inception
1 Year 3 Years 5 Years 12/29/89
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C>
FIRSTAR GROWTH AND INCOME FUND - INSTITUTIONAL 18.4 25.2 20.1 14.8
FIRSTAR GROWTH AND INCOME FUND - A - NO LOAD 18.1 25.0 19.9 14.7
FIRSTAR GROWTH AND INCOME FUND - A - LOAD<F1> 13.3 23.3 18.9 14.2
S&P 500 STOCK INDEX<F2> 22.0 26.0 21.3 16.7
- ------------------------------------------------------------------------------------------------------------------------------------
A = Series A (retail class)
<F1> Reflects maximum sales charge of 4.00%. Effective January 1, 1999 the
maximum sales charge will be 4.50%.
<F2> The S&P 500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approx i mately two-thirds of the total market value of all domestic common
stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A (retail) shares and Series Institutional shares. Series A shares,
unlike the Series Institutional shares, have a 4% maximum sales load and are
subject to an annual 0.25% service organiza tion fee. The load performance for
Series A shares has been restated to reflect the impact of the sales charge.
Series A performance prior to January 10, 1995, does not reflect the service
organization fees. If service organization fees had been reflected, performance
would be reduced. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/98
- ---------------------------------------------------
TYCO INTERNATIONAL, LTD. 4.0%
- ---------------------------------------------------
BANK OF NEW YORK 2.7%
- ---------------------------------------------------
MCKESSON CORPORATION 2.5%
- ---------------------------------------------------
INTERPUBLIC GROUP OF COMPANIES, INC. 2.4%
- ---------------------------------------------------
NORWEST CORPORATION 2.3%
- ---------------------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/98
- ---------------------------------------------------
$664,934,122
- ---------------------------------------------------
<PAGE>
(LOGO) FIRSTARFUNDS
- ------------------------------------------------------------------------------
EQUITY INDEX FUND
- ------------------------------------------------------------------------------
Firstar Equity Index Fund seeks to provide investment returns, before Fund
expenses, comparable to the price and yield performance of publicly traded
stocks in the aggregate, as represented by the S&P 500 Index. The Fund does not
use traditional methods of financial and market analysis when making purchase
and sale decisions: rather, the Fund invests primarily in common stocks that
comprise the S&P 500 Index in proportion to their relative capitalization and
sector weightings.
Firstar Equity Index Fund's net asset value of $74.66 ($74.58 Retail no-load) on
October 31, 1998 represents a one-year total return of 21.93% (21.63% Retail no-
load), which was comparable to the S&P 500's return of 22.0% over the same
period.
We believe that by applying a capitalization weighting and sector balancing
technique that matches the structure of the S&P 500, as well as using S&P 500
futures contracts to equitize the cash, the Fund should reasonably track the
performance of the index.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
DANIEL A. TRANCHITA, CFA, Vice President and Senior Portfolio Manager of Firstar
Investment Research & Management Company, LLC (FIRMCO) and CARL J. SMITH,
Assistant Vice President and Portfolio Manager co-manage the Fund - Dan since
July 1, 1992 and Carl since January 1, 1996. Dan has been with Firstar since
1989 and has nine years of investment management experience. He received his BA
in 1987 and his MBA in 1989 from Marquette University. Dan is a Chartered
Financial Analyst. Carl has been with Firstar since 1982 and has six years of
investment management experience. He received his BS in 1994 from Cardinal
Stritch College.
(PHOTO) (PHOTO)
DANIEL A. TRANCHITA, CFA CARL J. SMITH
<PAGE>
(LOGO) FIRSTARFUNDS
</TABLE>
<TABLE>
<CAPTION>
12/29/89 10/90 10/91 10/92 10/93 10/94 10/95 10/96 10/97 10/98
-------- -------- -------- -------- -------- -------- -------- -------- ------- ------
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FIRSTAR EQUITY INDEX
INSTITUTIONAL FUND $10,000 $8,854 $11,767 $12,869 $14,644 $15,157 $19,101 $23,624 $31,037 $37,843
FIRSTAR EQUITY INDEX
FUND - NO LOAD $10,000 $8,854 $11,767 $12,869 $14,644 $15,157 $19,066 $23,520 $30,830 $37,497
FIRSTAR EQUITY INDEX
FUND - LOAD $9,600 $8,501 $11,297 $12,355 $14,059 $14,552 $18,305 $22,581 $29,599 $35,997
S&P 500 $10,000 $8,855 $11,821 $12,999 $14,941 $15,519 $19,622 $24,351 $32,170 $39,244
</TABLE>
This chart assumes an initial investment of $10,000 made on 12/29/89
(inception). Per formance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Returns shown include the reinvestment
of all dividends and other distributions. Past performance is not predictive of
future performance. Investment return and principal value will fluctuate, so
that your shares, when redeemed, may be worth more or less than their original
cost.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
Since Inception
1 Year 3 Years 5 Years 12/29/89
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C>
FIRSTAR EQUITY INDEX FUND - INSTITUTIONAL 21.9 25.6 20.9 16.2
FIRSTAR EQUITY INDEX FUND - A - NO LOAD 21.6 25.3 20.7 16.1
FIRSTAR EQUITY INDEX FUND - A - LOAD<F1> 16.8 23.6 19.7 15.6
S&P 500 STOCK INDEX<F2> 22.0 26.0 21.3 16.7
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
<F1> Reflects maximum sales charge of 4.00%. Effective January 1, 1999 the
maximum sales charge will be 4.50%.
<F2> The S&P 500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approx i mately two-thirds of the total market value of all domestic common
stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A (retail) shares and Series Institutional shares. Series A shares,
unlike the Series Institutional shares, have a 4% maximum sales load and are
subject to an annual 0.25% service organization fee. In addition, the purchase
price adjustment on the Fund no longer applies to either the Series A or Series
Institutional shares. The load performance for Series A shares has been restated
to reflect the impact of the sales charge (and the elimination of the purchase
price adjustment). The no-load performance for the Series A and Series
Institutional shares has been restated to reflect the elimination of the
purchase price adjustment. Series A performance prior to January 10, 1995 does
not reflect the service organization fees. If service organization fees had been
reflected, performance would be reduced. Performance reflects fee waivers in
effect. In the absence of fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/98
- -------------------------------------
GENERAL ELECTRIC 3.1%
- -------------------------------------
MICROSOFT CORPORATION 2.8%
- -------------------------------------
EXXON CORPORATION 1.9%
- -------------------------------------
COCA-COLA COMPANY 1.8%
- -------------------------------------
MERCK & COMPANY, INC. 1.8%
- -------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/98
- -------------------------------------
$562,881,357
- -------------------------------------
<PAGE>
(LOGO) FIRSTARFUNDS
- --------------------------------------------------------------------------------
GROWTH FUND
- --------------------------------------------------------------------------------
Volatility in the world's financial markets dominated the headlines over the
last twelve months. The turmoil came to a climax during the last three months
of your Fund's fiscal year with the "Asian Contagion" that began to surface in
the Fall of 1997, spreading into Latin America and Russia. Despite this turmoil,
Firstar Growth Fund was able to achieve a return of +18.9% (18.6% Retail no-
load). This compares to the S&P 500's return of +22.0% and the average growth
fund, as measured by Lipper Analytical Services, at +9.6%.
The financial turmoil manifested itself with the disappearance of liquidity in
the marketplace. In this environment, large stocks continued to dominate
investment results as investors sought liquidity and brand names. The 20
largest companies in the S&P 500 on October 31, 1998 contributed an absolute
return of +14.6% to the entire index return of +22.0%. These companies on
average returned an astounding +48% (the remaining 480 companies therefore
contributed only an absolute return of 7.4% to the index). Of these 20
companies your portfolio held six - Microsoft, Merck, Intel, Cisco Systems,
Lucent and Dell (which contributed 5.1% of absolute return as they advanced an
average of 75% during the fiscal year).
Over the past 12 months, we owned critical stocks within the best performing
capitalization range of the market. While important to our returns, these
stocks did not determine our results as they did for the S&P 500. Our
historical commitment to "growth-at-a-reasonable-price" kept most of the
portfolio in companies outside of the "mega" category. Tyco (+59%), the largest
contributor to portfolio performance, was also the largest position in the Fund
during the year. Also showing material gains were Warner Lambert (+51%), SunGard
Data (+39%), IMS Health (+49%) and SunAmerica (+90%). See page 49 for a
complete listing of portfolio holdings.
Our decision last year to increase the market capitalization of the Fund
obviously helped our relative performance, but was only partially responsible.
Finding good medium-sized companies was still the most important variable. We
continue to maintain large positions in the consumer cyclical and finance
sectors as we have for several years. These two areas represented 41% of the
portfolio on October 31, 1998. While we were disappointed with our returns in
the consumer area we remain committed to them, as we believe the consumer
remains the strength behind our economy benefiting from excellent job growth,
lower interest rates and declining prices on imported products. In the
financial sector, we have emphasized companies that benefit from a continuing
trend toward savings and investment as the baby boom generation prepares for
retirement.
Technology represents another significant weighting in the portfolio. The
advent of the "year 2000" creates both challenges and opportunities for
technology as corporate America prepares for the millennium. As mentioned
above, the portfolio includes several of the technology industry giants
currently riding a huge wave of investment. In particular, the use of digital
media throughout our world is a theme we expect to be investing in for years to
come.
Overall we remain constructive on the market. The two main components of market
valuation are earnings and interest rates. Although third quarter operating
earnings for S&P 500 companies are on pace to decline for the first time since
1991, the outlook for 1999 is moderately better. The negative impact of foreign
currency should become a positive, and we are looking for flat corporate
profits. We believe interest rates can continue to decline because of the lack
of any inflationary pressure arguing for stable-to-higher price to earnings
ratios. In this environment, companies able to grow their earnings should be
richly rewarded by investors.
By sticking to our proven "growth-at-a-reasonable-price" strategy, we believe
the Fund can continue to provide attractive returns to shareowners. We
appreciate your continued confidence and support.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
MARIAN E. ZENTMYER, CFA, CFP, Chief Equity Investment Officer of Firstar
Investment Research & Management Company, LLC (FIRMCO) and WALTER DEWEY, CFA,
Vice President and Senior Portfolio Manager co-manage the Fund _ Marian since
June 18, 1996 and Walter since July 7, 1997. Marian has been with Firstar since
1982 and has 20 years of investment management experience. She received her BA
from Stanford University in 1978. Walter has been with Firstar since 1986 and
has 15 years of investment management experience. He received his BBA in 1983
from the University of Wisconsin.
(PHOTO) (PHOTO)
MARIAN E. ZENTMYER, WALTER DEWEY, CFA
CFA, CFP
<PAGE>
(LOGO) FIRSTARFUNDS
<TABLE>
<CAPTION>
12/29/89 10/93 10/94 10/95 10/96 10/97 10/98
-------- -------- -------- -------- -------- -------- --------
<C> <C> <C> <C> <C> <C> <C>
FIRSTAR GROWTH
INSTITUTIONAL FUND $10,000 $10,753 $10,813 $12,927 $15,360 $18,671 $22,199
FIRSTAR GROWTH
FUND - NO LOAD $10,000 $10,753 $10,813 $12,901 $15,291 $18,548 $21,994
FIRSTAR GROWTH
FUND - LOAD $9,600 $10,324 $10,382 $12,387 $14,682 $17,809 $21,114
S&P 500 $10,000 $10,981 $11,406 $14,422 $17,898 $23,645 $28,844
</TABLE>
This chart assumes an initial investment of $10,000 made on 12/29/92
(inception). Per formance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Returns shown include the reinvestment
of all dividends and other distributions. Past performance is not predictive of
future performance. Investment return and principal value will fluctuate, so
that your shares, when redeemed, may be worth more or less than their original
cost.
<TABLE>
<CAPTION>
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
Since Inception
1 Year 3 Years 5 Years 12/29/92
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C>
FIRSTAR GROWTH FUND - INSTITUTIONAL 18.9 19.7 15.6 14.6
FIRSTAR GROWTH FUND - A - NO LOAD 18.6 19.5 15.4 14.5
FIRSTAR GROWTH FUND - A - LOAD<F1> 13.8 17.8 14.5 13.7
S&P 500 STOCK INDEX<F2> 22.0 26.0 21.3 19.9
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
<F1> Reflects maximum sales charge of 4.00%. Effective January 1, 1999 the
maximum sales charge will be 4.50%.
<F2> The S&P 500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approximately two-thirds of the total market value of all domestic common
stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A (retail) shares and Series Institutional shares. Series A shares,
unlike the Series Institutional shares, have a 4% maximum sales load and are
subject to an annual 0.25% service organiza tion fee. The load performance for
the Series A shares has been restated to reflect the impact of the sales charge.
Series A performance prior to January 10, 1995, does not reflect the service
organization fees. If service organization fees had been reflected, perform ance
would be reduced. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/98
- ---------------------------------------
TYCO INTERNATIONAL, LTD. 4.4%
- ---------------------------------------
SUNGARD DATA SYSTEMS, INC. 3.5%
- ---------------------------------------
MCI WORLDCOM, INC. 3.0%
- ---------------------------------------
HARLEY-DAVIDSON, INC. 2.8%
- ---------------------------------------
STATE STREET CORPORATION 2.4%
- ---------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/98
- ---------------------------------------
$236,011,037
- ---------------------------------------
<PAGE>
(LOGO)FIRSTARFUNDS
- --------------------------------------------------------------------------------
SPECIAL GROWTH FUND
- --------------------------------------------------------------------------------
Firstar Special Growth Fund seeks capital appreciation through investments in
medium-sized companies with stock market capitalizations generally between $1
billion and $5 billion. The Fund's weighted average market capitalization is
currently $3.6 billion, slightly lower than its benchmark, the S&P MidCap 400
Index, which has a weighted average company value of $4.7 billion. During the
month of July, mid-capitalization stocks entered a bear market and continued to
fall through early October. By October 8th, the S&P MidCap 400 Index had fallen
25.5% from its high in April. This downturn, however, was followed by a 17.1%
gain for the S&P MidCap 400 Index in the last three weeks of October as
confidence came back into small and mid-sized companies. Volatility in the
markets impacted Fund performance as the Fund returned -5.66% (-5.91% Retail no-
load) against 6.71% for the S&P MidCap 400 Index and -4.46% for the Wilshire
MidCap 750 Universe for the fiscal year ended October 31, 1998.
The Fund continues to be overweighted in consumer cyclical, finance, technology
and healthcare stocks. Our research process has found more predictable growth
at reasonable prices in these sectors than in underweighted sectors like basic
materials, capital goods, transportation and utilities. The Fund experienced
relative outperformance in consumer cyclicals and finance due to rising
individual stocks like Dollar General, Bed Bath & Beyond and Concord EFS. In
addition, the Fund made the appropriate decision to overweight the healthcare
and technology sectors as they were the two best performing sectors in the S&P
MidCap 400 Index. Unfortunately, individual holdings within those two sectors
did not perform well. More specifically, the Fund's return was hurt by
fundamental misses at Adaptec, ADC Telecommunications and Shared Medical
Systems. These disappointments overshadowed gains in Fiserv, Synopsis and CSG
Systems.
During the second half of the fiscal year, the top performing stocks included
Charles Schwab (a discount broker), Protective Life (an insurance company),
Sofamor Danek (a maker of spinal cages) and Concord EFS (a transaction
processing company). Laggards included Gartner Group (a technology market
research company), General Nutrition (a vitamin retailer), MGIC Investment Corp.
(a mortgage insurer) and E*Trade Group (an online deep discount broker). Please
see page 51 for a complete listing of portfolio holdings.
With a weighted average expected growth rate in excess of 20%, combined with a
19X price-to-earnings multiple (which is a 22% discount to the market multiple),
we believe Firstar Special Growth Fund is well-positioned to take advantage of
solid relative performance opportunities. The S&P MidCap 400 Index sells at a
price-to-earnings multiple similar to the Fund but has an expected growth rate
only in the mid-single digits. In the future, we expect the persistency of
growth in the Fund's holdings to offer significant price appreciation. We
appreciate your continued support.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
TODD M. KRIEG, CFA, JD, Senior Vice President and Senior Portfolio Manager of
Firstar Investment Research & Management Company, LLC (FIRMCO) and MATTHEW
D'ATILLIO, CFA, Vice President and Portfolio Manager co-manage the Fund - Todd
since September 1, 1994 and Matt since December 1, 1998. Todd has been with
Firstar since 1992 and has six years of investment management experience. He
received his BA from Williams College in 1983 and a JD from Georgetown
University in 1989. Matt has been with Firstar since 1993 and has five years of
investment management experience. He received his BA from Bowdoin College in
1993. Todd and Matt are both Chartered Financial Analysts.
(PHOTO) (PHOTO)
TODD M. KRIEG, CFA, JD MATTHEW D'ATILLIO, CFA
<PAGE>
(LOGO) FIRSTARFUNDS
<TABLE>
<CAPTION>
12/29/89 10/90 10/91 10/92 10/93 10/94 10/95 10/96 10/97 10/98
-------- -------- -------- -------- -------- -------- -------- -------- ------- ------
<C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
FIRSTAR SPECIAL GROWTH
INSTITUTIONAL FUND $10,000 $8,953 $14,346 $15,617 $18,138 $18,641 $23,449 $26,399 $32,323 $30,494
FIRSTAR SPECIAL GROWTH
FUND - NO LOAD $10,000 $8,953 $14,346 $15,617 $18,138 $18,641 $23,406 $26,278 $32,106 $30,210
FIRSTAR SPECIAL GROWTH
FUND - LOAD $9,600 $8,596 $13,774 $14,994 $17,416 $17,898 $22,474 $25,231 $30,827 $29,002
S&P MIDCAP 400 $10,000 $8,293 $13,360 $14,804 $17,992 $18,420 $22,327 $26,200 $34,760 $37,092
S&P 500 $10,000 $8,855 $11,821 $12,999 $14,941 $15,519 $19,622 $24,351 $32,170 $39,244
</TABLE>
This chart assumes an initial investment of $10,000 made on 12/28/89
(inception). Per form ance reflects fee waivers in effect. In the absence of fee
waivers, total return would be reduced. Returns shown include the reinvestment
of all dividends and other distributions. Past performance is not predictive of
future performance. Investment return and principal value will fluctuate, so
that your shares, when redeemed, may be worth more or less than their original
cost.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
Since Inception
1 Year 3 Years 5 Years 12/28/89
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C>
FIRSTAR SPECIAL GROWTH FUND - INSTITUTIONAL (5.7) 9.1 10.9 13.4
FIRSTAR SPECIAL GROWTH FUND - A - NO LOAD (5.9) 8.9 10.7 13.3
FIRSTAR SPECIAL GROWTH FUND - A - LOAD<F1> (9.7) 7.4 9.8 12.8
S&P MIDCAP 400 INDEX<F2> 6.7 18.4 15.6 16.0
S&P 500 STOCK INDEX<F3> 22.0 26.0 21.3 16.7
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
<F1> Reflects maximum sales charge of 4.00%. Effective January 1, 1999 the
maximum sales charge will be 4.50%.
<F2> The S&P MidCap 400 Index is a capital-weighted index, representing the
aggregate market value of the common equity of 400 stocks chosen by
Standard &Poor's with a median capitalization of approximately $700
million.
<F3> The S&P500 Stock Index is an index of 500 selected common stocks, most of
which are listed on the New York Stock Exchange. The Index is heavily
weighted toward stocks with large market capitalizations and represents
approx i mately two-thirds of the total market value of all domestic common
stocks.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A (retail) shares and Series Institutional shares. Series A shares,
unlike the Series Institutional shares, have a 4% maxi mum sales load and are
subject to an annual 0.25% service organiza tion fee. The load performance for
the Series A shares has been restated to reflect the impact of the sales charge.
Series A performance prior to January 10, 1995, does not reflect the service
organization fees. If service organization fees had been reflected, perform ance
would be reduced. Performance reflects fee waivers in effect. In the absence of
fee waivers, total return would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/98
- ---------------------------------------
THE CHARLES SCHWAB CORPORATION 6.6%
- ---------------------------------------
PROTECTIVE LIFE CORPORATION 5.7%
- ---------------------------------------
AMBAC, INC. 5.0%
- ---------------------------------------
SYNOPSYS, INC. 4.8%
- ---------------------------------------
FISERV, INC. 4.4%
- ---------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/98
- ---------------------------------------
$601,004,084
- ---------------------------------------
<PAGE>
(LOGO) FIRSTARFUNDS
- --------------------------------------------------------------------------------
EMERGING GROWTH FUND
- --------------------------------------------------------------------------------
Firstar Emerging Growth Fund seeks capital appreciation through investments in
securities of small-sized companies with stock market capitalizations between
$250 million and $2 billion. The Fund's current weighted average market
capitalization is $750 million, roughly in line with its benchmark, the Standard
& Poor's SmallCap 600 Index, at $850 million. In the second half of the fiscal
year, small-sized companies saw a bear market with the average Russell 2000
stock falling 38% from its high. As a result, the Fund's second half return was
- -17.91% (-18.01% Retail no-load), yet this return compared favorably to the S&P
SmallCap 600 Index return of -21.39%, -21.20% for the Russell 2000 Index and -
20.78% for the Wishire Next 1750 Index during the same time period. Although
down for the fiscal year ended October 31, 1998, the Fund's -6.35% (-6.58%
Retail no-load) return ranks favorably among the returns of the indices with the
S&P SmallCap 600 Index at -11.06%, the Russell 2000 Index at -11.84% and the
Wilshire Next 1750 Index at -9.43%.
The Fund ended the fiscal year with a 1999 estimated price-to-earnings ratio
(P/E) of 14.6X - a few points lower than the 18.5X ratio for the S&P SmallCap
600 Index. At the same time, the weighted average 1999 estimated earnings
growth of the Fund's holdings is 24.2% while the S&P SmallCap 600 Index's growth
is only expected to be in the low single-digits in 1999. This lower P/E ratio,
combined with higher earnings growth, was maintained despite the continued focus
on companies with consistent and predictable revenue and earnings streams. The
majority of the Fund's holdings maintain a significant portion of their revenues
under long-term contracts.
Individual company holdings which made a major contribution to the Fund's second
half return included a top pick from analyst Peter Deininger called CDW Computer
Centers (a direct marketer of computer products), analyst Jennifer Hanson's
Eagle Hardware & Garden (a home improvement retailer), a 50% gain in Portfolio
Manager Joe Frohna's Intertel (telecommunications equipment), a rapidly rising
data processing company, Affiliated Computer from analyst Earl Delaet, analyst
Jim King's Barr Laboratories (a pharmaceutical company), analyst Tom Bolgert's
Granite Construction (a highway contractor) and a near doubling in analyst
Laurian Lytle's NCO Group (an accounts receivable management company). Laggards
included fundamental disappointments from ambulance operator Rural Metro and pet
retailer Petco Animal Supplies, both of which have been eliminated from the
Fund. Other weak holdings included Amkor Technology, Stein Mart and Forest Oil.
See page 53 for a complete list of portfolio holdings.
The Fund remains overweighted in consumer cyclicals, finance and technology.
Underweighted sectors include basic materials, capital goods, transportation and
utilities due to their lack of predictability and exposure to an economic
slowdown. The Fund's sector allocation decisions did not materially add or
subtract from the relative returns, rather, individual stock selection within
sectors drove the relative outperformance for the fiscal year.
The return in consumer cyclicals beat the benchmark's return due to the
performance of securities like CDW Computer Centers, Axciom and Men's Wearhouse.
Good relative performance also came out of finance where the Fund exceeded the
index's return because of investments in Financial Security Assurance and SEI
Investments. However, the most important sector in the relative outperformance
was technology where the Fund had several significant gains from stocks like
National Computer Systems, Sykes Enterprises, Mastech and BISYS Group. The only
two sectors of relative weakness against the benchmark were energy and
healthcare where declining oil and gas prices and increased regulation
compressed market multiples. Both sectors have been reduced and now represent
less than 9% of the Fund's current holdings.
With the Fund's holdings currently trading at a 35% discount to the Standard &
Poor's 500 Index price-to-earnings ratio of 23X, we believe smallcap and midcap
stocks have lots of upside left in valuation. In addition, the 20% plus growth
of the Fund's holdings far outstrips that of the larger stocks and the S&P
SmallCap 600 Index. As a result, we are optimistic about Firstar Emerging
Growth Fund and look forward to providing our shareowners with the opportunity
for attractive returns.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
TODD KRIEG, CFA, JD, Senior Vice President and Senior Portfolio Manager of
Firstar Investment Research & Management Company, LLC (FIRMCO) and MATTHEW
D'ATILLIO, CFA, Vice President and Portfolio Manager co-manage the Fund since
its inception August 15, 1997. Todd has been with Firstar since 1992 and has six
years of investment management experience. He received his BA from Williams
College in 1983 and a JD from Georgetown University in 1989. Matt has been with
Firstar since 1993 and has five years of investment management experience. He
received his BA from Bowdoin College in 1993. Todd and Matt are both Chartered
Financial Analysts.
(PHOTO) (PHOTO)
TODD KRIEG, CFA, JD MATTHEW D'ATILLIO, CFA
<PAGE>
(LOGO) FIRSTARFUNDS
8/15/97 10/97 10/98
-------- -------- --------
[C] [C] [C]
FIRSTAR EMERGING GROWTH
INSTITUTIONAL FUND $10,000 $10,310 $9,655
FIRSTAR EMERGING GROWTH
FUND - NO LOAD $10,000 $10,310 $9,631
FIRSTAR EMERGING GROWTH
FUND - LOAD $9,600 $9,894 $9,246
S&P 500 $10,000 $10,187 $12,427
S&P SMALLCAP 600 $10,000 $10,558 $9,390
WHILSHIRE NEXT 1750 $10,000 $10,564 $9,568
This chart assumes an initial investment of $10,000 made on 8/15/97 (inception).
Per form ance reflects fee waivers in effect. In the absence of fee waivers,
total return would be reduced. Returns shown include the reinvestment of all
dividends and other distributions. Past perform ance is not predictive of future
performance. Investment return and principal value will fluc tuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1998
- --------------------------------------------------------------------------------
Since Inception
One Year 8/15/97
- --------------------------------------------------------------------------------
FIRSTAR EMERGING GROWTH FUND - INSTITUTIONAL (6.4) (2.9)
FIRSTAR EMERGING GROWTH FUND - A - NO LOAD (6.6) (3.1)
FIRSTAR EMERGING GROWTH FUND - A - LOAD<F1> (10.3) (6.3)
S&P SMALLCAP 600 INDEX<F2> (11.1) (5.1)
WILSHIRE NEXT 1750 INDEX<F3> (9.4) (3.6)
- --------------------------------------------------------------------------------
A = Series A (retail class)
<F1> Reflects maximum sales charge of 4.00%. Effective January 1, 1999 the
maximum sales charge will be 4.50%.
<F2> The S&PSmallCap 600 Index is a capitalization weighted index that measures
the performance of selected U.S. stocks with small market capitalizations.
<F3>The Wilshire Next 1750 Index is an unmanaged index which shows the next
largest 1,750 companies after the Top 750 of the Wilshire 5000 Stock Index.
An investment cannot be made directly in an index.
Series A shares, unlike the Series Institutional shares, have a 4% maximum sales
load and are subject to an annual 0.25% service organization fee. Performance
reflects fee waivers in effect. In the absence of fee waivers, total return
would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/98
- ----------------------------------------------
AXCIOM CORPORATION 5.4%
- ----------------------------------------------
ARM FINANCIAL GROUP INC. - CLASS A 3.8%
- ----------------------------------------------
ABR INFORMATION SERVICES, INC. 3.6%
- ----------------------------------------------
SYKES ENTERPRISES, INC. 3.5%
- ----------------------------------------------
AVANT! CORPORATION 3.4%
- ----------------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/98
- ----------------------------------------------
$73,284,343
- ----------------------------------------------
<PAGE>
(LOGO) FIRSTARFUNDS
- --------------------------------------------------------------------------------
MICROCAP FUND
- --------------------------------------------------------------------------------
The fiscal year proved to be a volatile time for microcap investing. After
returning 18.8% (18.6% Retail no-load) the first six months of the fiscal year,
Firstar MicroCap Fund ended the 12 months ended October 31, 1998 down -21.5% (-
21.7% Retail no-load) - compared to the Russell 2000 which returned -11.8%.
This underperformance was due in large part to the collapse in stock prices as
the global economic slowdown was most severe in the microcap sector. During
this time, liquidity was constrained due to the increased global credit crunch
driving the risk premium dramatically up and stock prices down.
Falling stock prices late in the fiscal year were exacerbated by tax-loss
selling, whereby investors sell stocks with unrealized losses to offset gains
realized early in the year. After falling nearly 38% from their high, microcap
stocks were buoyed by the Federal Reserve interest rate cut on September 29th
and a second surprise cut in rates on October 15th. These moves by the Fed
helped ease the credit crunch and are bringing investors back to small and
microcap stocks.
Although the markets witnessed extreme volatility the last six months of the
fiscal year, we maintained our consistent focus of investing in companies with
recurring revenues, strong growth and large-end markets. Given the
indiscriminate selling which took place during the July through October
timeframe, we took advantage by buying stocks (such as Transaction Network
Services and Sterigenics) with limited international exposure and strong
persistency in their revenue stream. We also focused our new purchases in
sectors which are more defensive in nature - such as education, healthcare and
private prisons/security. Furthermore, we sold stocks which were more exposed
to a global economic slowdown, or were dependent on a strong capital spending
cycle such as SBS Technologies and ITEQ. See page 55 for a complete list of
portfolio holdings.
Looking ahead, we continue to believe microcap stocks will outperform the large
cap indices over the next six to twelve months as the market realizes the low
valuations and growth potential in the microcap sector. Additionally, history
is on our side - following the last 11 Federal Reserve interest rate easing
cycles, microcap stocks have outperformed the market by nearly 13% annually
through previous easing cycles.
The critical question to be answered is whether or not the microcap sector can
continue to grow their earnings at an above-average market rate. If so, we may
see extraordinary outperformance from the microcap sector. To offer our
shareowners an opportunity to capitalize on this situation, we have reopened the
Fund to new investments. In order to retain the integrity of the MicroCap
Fund's investment philosophy, we will close the Fund once we receive an
additional $50 million in investments.
Of course, microcap investing entails greater risk and we remind you of the
inherent volatility this type of Fund can present. As such, we appreciate your
continued confidence in Firstar MicroCap Fund and look forward to working with
you in the future.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
JOSEPH A. FROHNA, CFA, CPA, Vice President and Portfolio Manager of Firstar
Investment Research & Management Company, LLC (FIRMCO) has managed the Fund
since September 9, 1997. Joe has been with Firstar since 1995 and has five years
of investment management experience. Joe received his BBA from the University of
Wisconsin-Whitewater in 1986 and his MBA from the University of Michigan in
1994. Joe is a Chartered Financial Analyst.
(PHOTO)
JOSEPH A. FROHNA, CFA, CPA
<PAGE>
(LOGO) FIRSTARFUNDS
8/01/95 10/95 10/96 10/97 10/98
-------- -------- -------- ------- -------
[C] [C] [C] [C] [C]
FIRSTAR MICROCAP
INSTITUTIONAL FUND $10,000 $16,393 $17,188 $22,365 $17,555
FIRSTAR MICROCAP
FUND - NO LOAD $10,000 $16,352 $17,137 $22,240 $17,411
FIRSTAR MICROCAP
FUND - LOAD $9,600 $15,693 $16,446 $21,344 $16,715
RUSSELL 2000 $10,000 $11,709 $11,567 $14,960 $13,189
S&P 500 $10,000 $12,248 $12,975 $17,142 $20,911
This chart assumes an initial investment of $10,000 made on 8/1/95 (inception).
Per form ance reflects fee waivers in effect. In the absence of fee waivers,
total return would be reduced. Returns shown include the reinvestment of all
dividends and other distributions. Past perform ance is not predictive of future
performance. Investment return and principal value will fluc tuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1998
- --------------------------------------------------------------------------------
Since Inception
1 Year 3 Years 8/1/95
- --------------------------------------------------------------------------------
FIRSTAR MICROCAP FUND - INSTITUTIONAL (21.5) 16.5 18.9
FIRSTAR MICROCAP FUND - A - NO LOAD (21.7) 16.2 18.6
FIRSTAR MICROCAP FUND - A - LOAD<F1> (24.9) 14.6 17.1
RUSSELL 2000 INDEX<F2> (11.8) 10.0 8.9
- --------------------------------------------------------------------------------
A = Series A (retail class)
<F1> Reflects maximum sales charge of 4.00%. Effective January 1, 1999 the
maximum sales charge will be 4.50%.
<F2> The Russell 2000, an unmanaged index, consists of the smallest 2,000
companies in a group of 3,000 U.S. companies in the Russell 3000 Index, as
ranked by total market capitalization.
An investment cannot be made directly in an index.
Series A shares, unlike the Series Institutional shares, have a 4% maximum sales
load and are subject to an annual 0.25% service organization fee. Performance
reflects fee waivers in effect. In the absence of fee waivers, total return
would be reduced.
TOP 5 EQUITY HOLDINGS 10/31/98
- ----------------------------------------------
CORNELL CORRECTIONS, INC. 6.5%
- ----------------------------------------------
QUADRAMED CORPORATION 4.9%
- ----------------------------------------------
CAPITAL AUTOMOTIVE REIT 3.8%
- ----------------------------------------------
CHAMPIONSHIP AUTO RACING TEAMS, INC. 3.1%
- ----------------------------------------------
STERIGENICS INTERNATIONAL, INC. 2.8%
- ----------------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/98
- ----------------------------------------------
$85,115,362
- ----------------------------------------------
<PAGE>
(LOGO) FIRSTARFUNDS
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND
- --------------------------------------------------------------------------------
We continue to focus on undervalued companies with favorable long-term earnings
prospects for Firstar International Equity Fund. Our experience suggests that
fundamentals and valuations are the primary determinants of stock price
performance over the long-term; however, we have been in an environment that has
rewarded "growth and momentum" investors at the expense of "value" investors
during the past few years. We believe this is not sustainable and feel
fundamentals are re-emerging as the primary determinant of stock price
performance. We believe the International Fund is positioned to capitalize on
this trend through investments in undervalued companies worldwide. The fiscal
year-end for Firstar International Equity Fund brought a disappointing return of
- -15.97% (-16.16% Retail no-load). However, with patience we believe the
portfolio will yield attractive returns as we evolve from this difficult period
into the eventual recovery.
As of October 31, 1998 the International Equity Fund was broadly diversified
among 41 countries with 94% of the portfolio invested in stocks. The largest
weighting in the portfolio is invested in Europe (56%), followed by the Far East
including Australia/New Zealand (30%). The Americas (excluding the U.S.)
represent approximately 9% of the Fund.
Although European stocks contributed favorably to the Fund's performance this
year, we are finding it increasingly difficult to identify value in Europe. Our
interest in the region has gradually shifted from Southern Europe to Northern
Europe with an emphasis on opportunities in the Nordic countries and the U.K.
The largest individual European country exposure in the Fund is in the U.K.
where high interest rates, a strong currency, and a domestic economic slowdown
have led to depressed valuations. A reversal of these trends, particularly when
compared with continental European neighbors, is a potential catalyst for these
stocks to perform.
There is tremendous skepticism surrounding the outlook for economic and stock
market prospects in Japan. The economy is in recession, consumer confidence is
low, and pricing power has diminished, but the stock market has already
responded to much of these concerns by falling from its peak of 38,900 in 1989
to 13,500 at the end of October. We are somewhat optimistic with a small,
continued flow of Japanese stock ideas that are typically overlooked, have the
ability to be restructured and are domestically oriented.
Within the emerging markets, we have identified the most attractive
opportunities in Asia followed by Eastern Europe and Latin America. We believe
the recovery from extremely depressed valuations in many stocks in these
countries will contribute meaningfully to your Fund's longer-term performance.
Depressed commodity prices have had adverse effects particularly in the
developing countries and in Australia and New Zealand. In many of these stock
markets, we find an attractive combination of overly depressed economies,
attractive stock valuations, and undervalued currencies. In light of this, we
have increased our exposure in Australia and New Zealand, and we remain
committed to our holdings in several emerging markets.
We feel Firstar International Equity Fund is optimally positioned for the
future. The portfolio has been constructed based upon company fundamentals and
valuations with a 3-7 year investment horizon. In recent months, our research
team has performed extensive due diligence and visited 143 companies and various
government officials in: Austria, Belgium, Chile, Czech Republic, Denmark,
Finland, Hong Kong, Indonesia, Japan, Malaysia, Mexico, Norway, Philippines,
Peru, Russia, Slovakia, South Korea, Singapore, Sweden, Switzerland, Thailand
and the U.K.
We continue to work hard to deliver superior long-term results using our value
approach to investing. Your patience and support is greatly appreciated.
PORTFOLIO MANAGER PROFILE
- --------------------------------------------------------------------------------
JAMES E. CHANEY, Chief Investment Officer of Hansberger Global Investors, Inc.
(HGI), the Fund's sub-adviser, JOHN HOCK, CFA, Research Analyst and Assistant
Portfolio Manager of HGI, ROBERT MAZUELOS, Research Analyst and Assistant
Portfolio Manager of HGI, and DANIEL A. TRANCHITA, CFA, Vice President and
Senior Portfolio Manager of Firstar Investment Research & Management Company,
LLC (FIRMCO), the Fund's adviser, co-manage the Fund - James, John and Robert
since September 2, 1997 (when the sub-advisory agreement with HGI went into
affect) and Dan since the fund's inception April 28, 1994. Jim has been with HGI
since 1996 and has 14 years of investment management experience. He received his
BS from the University of Massachusetts - Amherst in 1979, his MS from
Northeastern University in 1983 and his MBA from Columbia University in 1987.
John has been with HGI since 1995 and has eight years of investment management
experience. He received his BS from Cornell University in 1990 and his MBA from
New York University in 1995. John is a Chartered Financial Analyst. Robert has
been with HGI since 1995 and has eight years of investment management
experience. He received his BS from the University of Florida in 1990. Dan has
been with Firstar since 1989 and has nine years of investment management
experience. He received his BA in 1987 and his MBA in 1989 from Marquette
University. Dan is a Chartered Financial Analyst.
(PHOTO) (PHOTO) (PHOTO) (PHOTO)
JAMES E. CHANEY JOHN HOCK, CFA ROBERT MAZUELOS DANIEL A. TRANCHITA,CFA
<PAGE>
(LOGO) FIRSTARFUNDS
<TABLE>
<CAPTION>
4/28/94 10/94 10/95 10/96 10/97 10/98
-------- -------- -------- -------- -------- --------
<C> <C> <C> <C> <C> <C>
FIRSTAR INTERNATIONAL EQUITY
INSTITUTIONAL FUND $10,000 $9,995 $9,620 $10,410 $9,879 $8,303
FIRSTAR INTERNATIONAL EQUITY
FUND - NO LOAD $10,000 $9,995 $9,600 $10,363 $9,814 $8,228
FIRSTAR INTERNATIONAL EQUITY
FUND - LOAD $9,600 $9,597 $9,218 $9,951 $9,424 $7,899
EAFE $10,000 $10,429 $10,390 $11,478 $12,009 $13,168
</TABLE>
This chart assumes an initial investment of $10,000 made on 4/28/94 (inception).
Per form ance reflects fee waivers in effect. In the absence of fee waivers,
total return would be reduced. Returns shown include the reinvestment of all
dividends and other distributions. Past perform ance is not predictive of future
performance. Investment return and principal value will fluc tuate, so that your
shares, when redeemed, may be worth more or less than their original cost.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RATE OF RETURN (%)
FOR PERIODS ENDED OCTOBER 31, 1998
- ------------------------------------------------------------------------------------------------------------------------------------
Since Inception
1 Year 3 Years 4/28/94
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C>
FIRSTAR INTERNATIONAL EQUITY FUND - INSTITUTIONAL (16.0) (4.8) (4.0)
FIRSTAR INTERNATIONAL EQUITY FUND - A - NO LOAD (16.2) (5.0) (4.2)
FIRSTAR INTERNATIONAL EQUITY FUND - A - LOAD<F1> (19.5) (6.3) (5.1)
EAFEINDEX<F2> 9.7 8.2 6.3
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
A = Series A (retail class)
<F1> Reflects maximum sales charge of 4.00%. Effective January 1, 1999 the
maximum sales charge will be 4.50%.
<F2> The Morgan Stanley Capital International Europe, Australia and Far East
Index, ("MSCI/EAFE") is an unmanaged index composed of 20 European and
Pacific Basin countries. The MSCI/EAFEIndex is the most recognized
international index and is weighted by market capitalization.
An investment cannot be made directly in an index.
Effective at the close of business on January 9, 1995, Firstar Funds began to
offer Series A (retail) shares and Series Institutional shares. Series A shares,
unlike the Series Institutional shares, have a 4% maximum sales load and are
subject to an annual 0.25% service organization fee. In addition, the purchase
price adjustment on the Fund no longer applies to either the Series A or Series
Institutional shares. The load performance for Series A shares has been restated
to reflect the impact of the sales charge (and the elimination of the purchase
price adjustment). The no-load performance for the Series A shares and the
Series Institutional shares have been restated to reflect the elimination of the
purchase price adjustment. Series A performance prior to January 10, 1995 does
not reflect the service organization fees. If service organization fees had been
reflected, performance would be reduced. Performance reflects fee waivers in
effect. In the absence of fee waivers, total return would be reduced.
TOP 5 COUNTRIES 10/31/98
- ----------------------------------------
GREAT BRITAIN 12.5%
- ----------------------------------------
JAPAN 7.5%
- ----------------------------------------
FRANCE 6.3%
- ----------------------------------------
HONG KONG 6.1%
- ----------------------------------------
SPAIN 6.1%
- ----------------------------------------
Portfolio holdings are subject to change and are not a representation of the
Fund's entire portfolio holdings.
TOTAL FUND NET ASSETS 10/31/98
- ----------------------------------------
$51,156,362
- ----------------------------------------
<PAGE>
(LOGO) FIRSTARFUNDS
STATEMENT OF ASSETS AND LIABILITIES
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
OCTOBER 31, 1998
<TABLE>
<CAPTION>
BALANCED GROWTH AND EQUITY
GROWTH INCOME INDEX
FUND FUND FUND
-------- -------- --------
<C> <C> <C>
ASSETS:
Investments, at value (cost $209,436, $468,009, $331,009, $167,346,
$465,653, $67,122, $81,091, $63,679, respectively) $249,841 $657,749 $563,662
Cash - - 21
Income receivable 1,252 1,170 648
Capital shares sold 445 1,209 591
Receivable for securities sold 1,822 11,036 217
Other assets 20 30 30
-------- -------- --------
Total Assets 253,380 671,194 565,169
-------- -------- --------
LIABILITIES:
Payable for securities purchased 5,350 4,953 -
Capital shares redeemed 65 745 2,082
Payable to affiliates 164 530 182
Accrued expenses and other liabilities 21 32 24
-------- -------- --------
Total Liabilities 5,600 6,260 2,288
-------- -------- --------
NET ASSETS $247,780 $664,934 $562,881
======== ======== ========
NET ASSETS CONSIST OF:
Capital stock $199,861 $425,586 $326,978
Undistributed net investment income (loss) 373 910 621
Undistributed accumulated net realized gains (losses) on
Investments 7,141 48,698 844
Unrealized net appreciation (depreciation) on:
Investments 40,405 189,740 232,653
Futures contracts - - 1,785
Foreign currency - - -
-------- -------- --------
Total Net Assets $247,780 $664,934 $562,881
======== ======== ========
SERIES A:
Net assets $ 59,657 $190,331 $110,129
Shares authorized ($.0001 par value) 500,000 500,000 500,000
Shares issued and outstanding 2,001 4,286 1,477
Net asset value and redemption price per share <F1> $29.82 $44.41 $74.58
======== ======== ========
Maximum offering price per share <F1> $31.06 $46.26 $77.69
======== ======== ========
SERIES INSTITUTIONAL:
Net assets $188,123 $474,603 $452,752
Shares authorized ($.0001 par value) 500,000 500,000 500,000
Shares issued and outstanding 6,302 10,674 6,064
Net asset value, redemption price and offering price per share <F1> $29.85 $44.46 $74.66
======== ======== ========
<F1> Amounts may not recalculate due to rounding.
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTARFUNDS
<TABLE>
<CAPTION>
SPECIAL EMERGING INTERNATIONAL
GROWTH GROWTH GROWTH MICROCAP EQUITY
FUND FUND FUND FUND FUND
-------- -------- -------- -------- --------
<C> <C> <C> <C> <C>
ASSETS:
Investments, at value (cost $209,436, $468,009, $331,009, $167,346,
$465,653, $67,122, $81,091, $63,679, respectively) $235,176 $605,308 $ 68,871 $85,674 $ 50,099
Cash - - - - -
Income receivable 187 195 39 54 378
Capital shares sold 350 726 4,289 -00 50
Receivable for securities sold 3,592 3,789 941 432 2,264
Other assets 19 31 44 32 13
-------- -------- -------- -------- --------
Total Assets 239,324 610,049 74,184 86,192 52,804
-------- -------- -------- -------- --------
LIABILITIES:
Payable for securities purchased 2,959 4,428 829 916 920
Capital shares redeemed 143 4,054 14 19 199
Payable to affiliates 195 525 45 128 87
Accrued expenses and other liabilities 16 38 12 14 442
-------- -------- -------- -------- --------
Total Liabilities 3,313 9,045 900 1,077 1,648
-------- -------- -------- -------- --------
NET ASSETS $ 236,011 $601,004 $73,284 $85,115 $51,156
======== ======== ======== ======== ========
NET ASSETS CONSIST OF:
Capital stock $141,456 $458,626 $77,996 $80,837 $69,060
Undistributed net investment income (loss) 234 (2) 71 (3) 866
Undistributed accumulated net realized gains (losses) on
Investments 26,491 2,725 (6,532) (302) (5,191)
Unrealized net appreciation (depreciation) on:
Investments 67,830 139,655 1,749 4,583 (13,580)
Futures contracts - - - - -
Foreign currency - - - - 1
-------- -------- -------- -------- --------
Total Net Assets $236,011 $601,004 $73,284 $85,115 $51,156
======== ======== ======== ======== ========
SERIES A:
Net assets $ 38,213 $136,146 $ 12,884 $ 12,419 $ 6,486
Shares authorized ($.0001 par value) 500,000 500,000 500,000 500,000 500,000
Shares issued and outstanding 1,070 3,622 1,348 1,003 427
Net asset value and redemption price per share <F1> $35.72 $37.59 $9.56 $12.38 $15.18
======== ======== ======== ======== ========
Maximum offering price per share <F1> $37.21 $39.16 $9.96 $12.90 $15.81
======== ======== ======== ======== ========
SERIES INSTITUTIONAL:
Net assets $197,798 $464,858 $ 60,400 $ 72,696 $ 44,670
Shares authorized ($.0001 par value) 500,000 500,000 500,000 500,000 500,000
Shares issued and outstanding 5,488 12,230 6,305 5,822 2,927
Net asset value, redemption price and offering price per share <F1> $36.05 $38.01 $9.58 $12.49 $15.26
======== ======== ======== ======== ========
<F1> Amounts may not recalculate due to rounding.
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
BALANCED GROWTH AND
GROWTH FUND INCOME FUND
--------------- ---------------
Year Year Year Year
ended ended ended ended
Oct. Oct. Oct. Oct.
31, 31, 31, 31,
1998 1997 1998 1997
------ ------ ------ ------
<C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $ 4,908 $ 4,197 $ 6,241 $ 5,272
Net realized gain (loss) on:
Investments 7,539 17,108 48,714 17,736
Foreign currency - - - -
Net change in unrealized appreciation
(depreciation) on:
Investments 5,444 9,540 37,014 83,976
Foreign currency - - - -
-------- -------- -------- --------
Net increase (decrease) in net assets
resulting from operations 17,891 30,845 91,969 106,984
-------- -------- -------- --------
CAPITAL SHARE TRANSACTIONS:
Shares sold 82,729 82,936 216,717 182,721
Shares issued to owners in
reinvestment of dividends 21,725 13,325 20,917 27,125
Shares redeemed (60,901) (63,501) (135,217) (90,531)
-------- -------- -------- --------
Net increase (decrease) in net assets as
a result of capital share transactions 43,553 32,760 102,417 119,315
-------- -------- -------- --------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income (1,052) (722) (1,343) (1,107)
From net realized gains (3,620) (1,751) (4,638) (5,918)
-------- -------- -------- --------
(4,672) (2,473) (5,981) (7,025)
-------- -------- -------- --------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income (3,864) (3,385) (4,463) (4,136)
From net realized gains (13,536) (7,788) (13,098) (19,246)
-------- -------- -------- --------
(17,400) (11,173) (17,561) (23,382)
-------- -------- -------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS 39,372 49,959 170,844 195,892
NET ASSETS:
Beginning of period 208,408 158,449 494,090 298,198
-------- -------- -------- --------
End of period (including undistributed
net investment income (loss) of $373,
$460, $910, $535, $621, $513, $234, $121,
$(2), $(2), $(71) and $117, respectively) $247,780 $208,408 $664,934 $494,090
======== ======== ======== ========
<F1> Commencement of operations.
</TABLE>
See notes to the financial statements.
<TABLE>
<CAPTION>
EQUITY SPECIAL EMERGING
INDEX FUND GROWTH FUND GROWTH FUND GROWTH FUND
--------------- --------------- --------------- ---------------
Year Year Year Year Year Year Year Aug. 15,
ended ended ended ended ended ended ended 1997<F1>
Oct. Oct. Oct. Oct. Oct. Oct. Oct. through
31, 31, 31, 31, 31, 31, 31, Oct. 31,
1998 1997 1998 1997 1998 1997 1998 1997
------ ------ ------ ------ ------ ------ ------ ------
<C> <C> <C> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss)
$ 6,945 $5,279 $ 356 $ 119$ (2,626)$ (2,028) $ 303 $ 117
Net realized gain (loss) on:
Investments 1,439 7,245 26,680 30,037 3,773 70,538 (6,752) 306
Foreign currency - - - - - - - -
Net change in unrealized appreciation
(depreciation) on:
Investments 81,804 68,766 10,510 6,762 (33,543) 67,542 875 873
Foreign currency - - - - - - - -
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets
resulting from operations 90,188 81,290 37,546 36,918 (32,396) 136,052 (5,574) 1,296
-------- -------- -------- -------- -------- -------- -------- --------
CAPITAL SHARE TRANSACTIONS:
Shares sold 184,708 164,226 68,655 56,737 149,421 204,220 40,444 52,281
Shares issued to owners in
reinvestment of dividends 12,729 7,676 23,938 5,867 64,516 67,741 352 -
Shares redeemed (103,374) (103,969) (70,468) (57,271) (225,403) (210,150) (14,898) (178)
-------- -------- -------- -------- -------- -------- -------- --------
Net increase (decrease) in net assets as
a result of capital share transactions 94,063 67,933 22,125 5,333 (11,466) 61,811 25,898 52,103
-------- -------- -------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income (1,155) (822) (16) - - - (12) -
From net realized gains (1,399) (516) (3,671) (740) (14,736) (14,101) (33) -
-------- -------- -------- -------- -------- -------- -------- --------
(2,554) (1,338) (3,687) (740) (14,736) (14,101) (45) -
-------- -------- -------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income (5,682) (4,327) (185) - - - (118) -
From net realized gains (5,759) (2,661) (26,481) (6,747) (56,822) (61,354) (276) -
-------- -------- -------- -------- -------- -------- -------- --------
(11,441) (6,988) (26,666) (6,747) (56,822) (61,354) (394) -
-------- -------- -------- -------- -------- -------- -------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS 170,256 140,897 29,318 34,764 (115,420) 122,408 19,885 53,399
NET ASSETS:
Beginning of period 392,625 251,728 206,693 171,929 716,424 594,016 53,399 -
-------- -------- -------- -------- -------- -------- -------- --------
End of period (including undistributed
net investment income (loss) of $373,
$460, $910, $535, $621, $513, $234, $121,
$(2), $(2), $(71) and $117, respectively) $562,881 $392,625 $236,011 $206,693 $601,004 $716,424 $73,284 $53,399
======== ======== ======== ======== ======== ======== ======== ========
<F1> Commencement of operations.
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
STATEMENT OF CHANGES IN NET ASSETS
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION> INTERNATIONAL
MICROCAP FUND EQUITY FUND
--------------- --------------
Year Year Year Year
ended ended ended ended
Oct. Oct. 31, Oct. 31, Oct. 31,
1998 1997 1998 1997
----- ---- ---- ----
<C> <C> <C> <C>
OPERATIONS:
Net investment income (loss) $(1,595) $(1,086) $855 $(174)
Net realized gain (loss) on:
Investments (275) 12,681 (5,124) 1,964
Foreign currency - - (23) 28
Net change in unrealized appreciation
(depreciation) on:
Investments (21,884) 13,904 (7,356) (5,960)
Foreign currency - - 5 (1)
-------- -------- -------- --------
Net increase (decrease) in net assets
resulting from operations (23,754) 25,499 (11,643) (4,143)
-------- -------- -------- --------
CAPITAL SHARE TRANSACTIONS:
Shares sold 3,237 28,930 16,655 32,361
Shares issued to owners in
reinvestment of dividends 9,448 11,413 1,247 1,265
Shares redeemed (13,035) (8,081) (17,246) (11,236)
-------- -------- -------- --------
Net increase (decrease) in net assets
as a result of capital share transactions (350) 32,262 656 22,390
-------- -------- -------- --------
DISTRIBUTIONS TO SERIES A SHAREOWNERS:
From net investment income - - (31) (25)
From net realized gains (1,599) (1,540) (135) (92)
-------- -------- -------- --------
(1,599) (1,540) (166) (117)
-------- -------- -------- --------
DISTRIBUTIONS TO SERIES INSTITUTIONAL
SHAREOWNERS:
From net investment income - - (277) (363)
From net realized gains (9,815) (11,229) (1,122) (1,010)
-------- -------- -------- --------
(9,815) (11,229) (1,399) (1,373)
-------- -------- -------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS (35,518) 44,992 (12,552) 16,757
NET ASSETS:
Beginning of period 120,633 75,641 63,708 46,951
-------- -------- -------- --------
End of period (including undistributed net
investment income (loss) of $(3), $(2),
$866 and $275, respectively) $85,115 $120,633 $51,156 $63,708
======== ======== ======== ========
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
BALANCED GROWTH FUND
---------------------------------------------------------------------------------------
Year ended Year ended Year ended Year ended
October 31, October 31, October 31, October 31, Year
1998 1997 1996 1995<F2> ended
----------------- ----------------- ----------------- ----------------- October
Series Series Series Series Series Series Series Series 31,
A Inst'l. A Inst'l. A Inst'l. A Inst'l. 1994
------- ------- ------- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $30.48 $30.51 $27.98 $27.99 $25.89 $25.90 $22.10 $22.10 $22.76
Income from investment operations:
Net investment income 0.56 0.62 0.58 0.66 0.47<F7> 0.55<F7> 0.49 0.53 0.44
Net realized and unrealized
gains (losses) on securities 1.86 1.86 4.19 4.20 2.64 2.62 3.77 3.78 (0.66)
------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations 2.42 2.48 4.77 4.86 3.11 3.17 4.26 4.31 (0.22)
------- ------- ------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income (0.58) (0.64) (0.59) (0.66) (0.47) (0.53) (0.47) (0.51) (0.44)
Distributions from capital gains (2.50) (2.50) (1.68) (1.68) (0.55) (0.55) - - -
------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions (3.08) (3.14) (2.27) (2.34) (1.02) (1.08) (0.47) (0.51) (0.44)
------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period $29.82 $29.85 $30.48 $30.51 $27.98 $27.99 $25.89 $25.90 $22.10
======= ======= ======= ======= ======= ======= ======= ======= =======
Total return <F3> <F4> 8.60% 8.83% 18.07% 18.39% 12.30% 12.56% 19.55% 19.79% (0.93)%
Supplemental data and ratios:
Net assets, in thousands,
end of period $59,657 $188,123 $44,026 $164,382 $29,034 $129,415 $21,832 $104,552 $94,657
Ratio of net expenses
to average net assets <F5> <F10> 1.00% 0.75% 1.00% 0.75% 1.00% 0.75% 0.94% 0.75% 0.75%
Ratio of net investment income
to average net assets <F5> <F11> 1.91% 2.16% 2.06% 2.31% 1.80% 2.05% 2.05% 2.24% 2.03%
Portfolio turnover rate <F3> <F6> 56.44% 56.44% 69.90% 69.90% 63.91% 63.91% 61.87% 61.87% 59.77%
</TABLE>
<F1> Commencement of operations.
<F2> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareowners exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented
on a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class
of shares based upon the relative net assets of each class of shares as
of the close of business on January 9, 1995, and the results thereof
combined with the results of operations and distributions for each
applicable class for the period January 10, 1995, through October 31,
1995.
<F3> Not annualized for the period ended October 31, 1997, for the Emerging
Growth Fund, for the periods ended October 31, 1996 and June 30, 1996,
for the MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F4> The total return does not reflect the 4% front-end sales charge for
Series A.
<F5> Annualized for the period ended October 31, 1997, for the Emerging Growth
Fund, for the periods ended October 31, 1996 and June 30, 1996, for the
MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F6> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
<F7> Net investment income (loss) per share is calculated using ending
balances prior to consideration of adjustments for permanent book and tax
differences.
<F8> Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors.
<F9> Net investment income (loss) per share represents net investment income
divided by average shares outstanding throughout the year.
<F10> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1998, 1997, 1996, 1995 and 1994 would have
been 1.24%, 0.99%, 1.25%, 1.00%, 1.28%, 1.03%, 1.25%, 1.06%, and 1.05%,
respectively.
<F11> Without fees waived, ratios of net investment income to average net assets
for the fiscal years ended October 31, 1998, 1997, 1996, 1995 and 1994
would have been 1.67%, 1.92%, 1.80%, 2.05%, 1.52%, 1.77%, 1.74%, 1.93%
and 1.73%, respectively.
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
GROWTH AND INCOME FUND
---------------------------------------------------------------------------------------
Year ended Year ended Year ended Year ended
October 31, October 31, October 31, October 31, Year
1998 1997 1996 1995<F2> ended
----------------- ----------------- ----------------- ----------------- October
Series Series Series Series Series Series Series Series 31,
A Inst'l. A Inst'l. A Inst'l. A Inst'l. 1994
------- ------- ------- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $39.24 $39.28 $33.07 $33.08 $27.62 $27.63 $23.09 $23.09 $23.70
Income from investment operations:
Net investment income 0.36 0.47 0.37 0.46 0.42<F7> 0.50<F7> 0.37 0.42 0.43
Net realized and unrealized
gains (losses) on securities 6.55 6.55 8.92 8.94 6.61 6.61 5.14 5.14 (0.03)
------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations 6.91 7.02 9.29 9.40 7.03 7.11 5.51 5.56 0.40
------- ------- ------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income (0.35) (0.45) (0.39) (0.47) (0.39) (0.47) (0.38) (0.42) (0.42)
Distributions from capital gains (1.39) (1.39) (2.73) (2.73) (1.19) (1.19) (0.60) (0.60) (0.59)
------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions (1.74) (1.84) (3.12) (3.20) (1.58) (1.66) (0.98) (1.02) (1.01)
------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period $44.41 $44.46 $39.24 $39.28 $33.07 $33.08 $27.62 $27.63 $23.09
======= ======= ======= ======= ======= ======= ======= ======= =======
Total return <F3> <F4> 18.08% 18.35% 30.47% 30.83% 26.62% 26.90% 24.75% 25.00% 1.84%
Supplemental data and ratios:
Net assets, in thousands,
end of period $190,331 $474,603 $128,070 $366,020 $71,310 $226,888 $42,424 $162,752 $164,053
Ratio of net expenses
to average net assets <F5> <F10> 1.12% 0.87% 1.12% 0.87% 1.15% 0.90% 1.09% 0.90% 0.90%
Ratio of net investment income
to average net assets <F5> <F11> 0.86% 1.11% 1.09% 1.34% 1.42% 1.67% 1.51% 1.70% 1.89%
Portfolio turnover rate <F3> <F6> 48.56% 48.56% 31.36% 31.36% 51.37% 51.37% 47.85% 47.85% 56.85%
</TABLE>
<F1> Commencement of operations.
<F2> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareowners exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented
on a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class
of shares based upon the relative net assets of each class of shares as
of the close of business on January 9, 1995, and the results thereof
combined with the results of operations and distributions for each
applicable class for the period January 10, 1995, through October 31,
1995.
<F3> Not annualized for the period ended October 31, 1997, for the Emerging
Growth Fund, for the periods ended October 31, 1996 and June 30, 1996,
for the MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F4> The total return does not reflect the 4% front-end sales charge for
Series A.
<F5> Annualized for the period ended October 31, 1997, for the Emerging Growth
Fund, for the periods ended October 31, 1996 and June 30, 1996, for the
MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F6> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
<F7> Net investment income (loss) per share is calculated using ending
balances prior to consideration of adjustments for permanent book and tax
differences.
<F8> Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors.
<F9> Net investment income (loss) per share represents net investment income
divided by average shares outstanding throughout the year.
<F10> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1998, 1997, 1996, 1995 and 1994 would have
been 1.19%, 0.94%, 1.19%, 0.94%, 1.23%, 0.98%, 1.20%, 1.01%, and 1.01%,
respectively, for the Growth and Income Fund and 0.69%, 0.44%, 0.70%,
0.45%, 0.73%, 0.48%, 0.73%, 0.53%, and 0.57%, respectively, for the
Equity Index Fund.
<F11> Without fees waived, ratios of net investment income to average net assets
for the fiscal years ended October 31, 1998, 1997, 1996, 1995 and 1994
would have been 0.79%, 1.04%, 1.02%, 1.27%, 1.35%, 1.59%, 1.40%, 1.59%
and 1.78%, respectively, for the Growth and Income Fund and 1.07%, 1.32%,
1.33%, 1.59%, 1.69%, 1.94%, 2.07%, 2.27%, and 2.31%, respectively, for
the Equity Index Fund.
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
EQUITY INDEX FUND
---------------------------------------------------------------------------------------
Year ended Year ended Year ended Year ended
October 31, October 31, October 31, October 31, Year
1998 1997 1996 1995<F2> ended
----------------- ----------------- ----------------- ----------------- October
Series Series Series Series Series Series Series Series 31,
A Inst'l. A Inst'l. A Inst'l. A Inst'l. 1994
------- ------- ------- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $63.11 $63.16 $49.40 $49.43 $41.07 $41.08 $33.41 $33.41 $33.04
Income from investment operations:
Net investment income 0.84<F9> 1.02<F9> 0.80 0.95 0.77<F7> 0.91<F7> 0.70 0.76 0.77
Net realized and unrealized
gains (losses) on securities 12.58 12.59 14.33 14.33 8.69 8.68 7.70 7.71 0.35
------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations 13.42 13.61 15.13 15.28 9.46 9.59 8.40 8.47 1.12
------- ------- ------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income (0.84) (1.00) (0.81) (0.94) (0.78) (0.89) (0.68) (0.74) (0.75)
Distributions from capital gains (1.11) (1.11) (0.61) (0.61) (0.35) (0.35) (0.06) (0.06) -
------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions (1.95) (2.11) (1.42) (1.55) (1.13) (1.24) (0.74) (0.80) (0.75))
------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period $74.58 $74.66 $63.11 $63.16 $49.40 $49.43 $41.07 $41.08 $33.41
======= ======= ======= ======= ======= ======= ======= ======= =======
Total return <F3> <F4> 21.63% 21.93% 31.08% 31.38% 23.36% 23.68% 25.79% 26.02% 3.51%
Supplemental data and ratios:
Net assets, in thousands,
end of period $110,129 $452,752 $76,866 $315,759 $39,656 $212,072 $18,663 $138,106 $107,563
Ratio of net expenses
to average net assets <F5> <F10> 0.58% 0.33% 0.63% 0.38% 0.66% 0.41% 0.66% 0.46% 0.50%
Ratio of net investment income
to average net assets <F5> <F11> 1.18% 1.43% 1.40% 1.66% 1.76% 2.01% 2.14% 2.34% 2.38%
Portfolio turnover rate <F3> <F6> 2.91% 2.91% 9.81% 9.81% 7.48% 7.48% 4.61% 4.61% 13.28%
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
GROWTH FUND
---------------------------------------------------------------------------------------
Year ended Year ended Year ended Year ended
October 31, October 31, October 31, October 31, Year
1998 1997 1996 1995<F2> ended
----------------- ----------------- ----------------- ----------------- October
Series Series Series Series Series Series Series Series 31,
A Inst'l. A Inst'l. A Inst'l. A Inst'l. 1994
------- ------- ------- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $35.27 $35.48 $30.32 $30.43 $25.58 $25.61 $21.47 $21.47 $21.40
Income from investment operations:
Net investment income (0.02)<F9> 0.07<F9>(0.05)<F7> 0.04<F7>(0.07)<F7>(0.01)<F7> (0.02) 0.03 0.06
Net realized and unrealized
gains (losses) on securities 5.66 5.70 6.30 6.31 4.81 4.83 4.16 4.16 0.06
------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations 5.64 5.77 6.25 6.35 4.74 4.82 4.14 4.19 0.12
------- ------- ------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income (0.02) (0.03) - - - - (0.03) (0.05) (0.05)
Distributions from capital gains (5.17) (5.17) (1.30) (1.30) - - - - -
------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions (5.19) (5.20) (1.30) (1.30) - - (0.03) (0.05) (0.05)
------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period $35.72 $36.05 $35.27 $35.48 $30.32 $30.43 $25.58 $25.61 $21.47
======= ======= ======= ======= ======= ======= ======= ======= =======
Total return <F3> <F4> 18.58% 18.89% 21.30% 21.56% 18.53% 18.82% 19.31% 19.55% 0.56%
Supplemental data and ratios:
Net assets, in thousands,
end of period $38,213 $197,798 $25,043 $181,650 $16,636 $155,293 $10,105 $134,428 $113,197
Ratio of net expenses
to average net assets <F5> <F10> 1.14% 0.89% 1.14% 0.89% 1.15% 0.90% 1.09% 0.90% 0.88%
Ratio of net investment income
to average net assets <F5> <F11> (0.05)% 0.20% (0.16)% 0.09% (0.29)% (0.04)% (0.06)% 0.13% 0.30%
Portfolio turnover rate <F3> <F6> 51.82% 51.82% 62.09% 62.09% 56.75% 56.75% 49.84% 49.84% 33.24%
</TABLE>
<F1> Commencement of operations.
<F2> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareowners exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented
on a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class
of shares based upon the relative net assets of each class of shares as
of the close of business on January 9, 1995, and the results thereof
combined with the results of operations and distributions for each
applicable class for the period January 10, 1995, through October 31,
1995.
<F3> Not annualized for the period ended October 31, 1997, for the Emerging
Growth Fund, for the periods ended October 31, 1996 and June 30, 1996,
for the MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F4> The total return does not reflect the 4% front-end sales charge for
Series A.
<F5> Annualized for the period ended October 31, 1997, for the Emerging Growth
Fund, for the periods ended October 31, 1996 and June 30, 1996, for the
MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F6> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
<F7> Net investment income (loss) per share is calculated using ending
balances prior to consideration of adjustments for permanent book and tax
differences.
<F8> Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors.
<F9> Net investment income (loss) per share represents net investment income
divided by average shares outstanding throughout the year.
<F10> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1998, 1997, 1996, 1995 and 1994 would have
been 1.21%, 0.96%, 1.21%, 0.96%, 1.23%, 0.98%, 1.21%, 1.02%, and 1.00%,
respectively, for the Growth Fund and 1.20%, 0.95%, 1.20%, 0.95%, 1.20%,
0.95%, 1.17%, 0.98%, and 0.98%, respectively, for the Special Growth
Fund.
<F11> Without fees waived, ratios of net investment income to average net assets
for the fiscal years ended October 31, 1998, 1997, 1996, 1995 and 1994
would have been (0.12)%, 0.13%, (0.24)%, 0.01%, (0.36)%, (0.12)%,
(0.18)%, 0.01% and 0.19%, respectively, for the Growth Fund and (0.64%),
(0.39)%, (0.57)%, (0.32)%, (0.42)%, (0.17)%, (0.27)%, (0.08)%, and 0.04%,
respectively, for the Special Growth Fund.
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SPECIAL GROWTH FUND
---------------------------------------------------------------------------------------
Year ended Year ended Year ended Year ended
October 31, October 31, October 31, October 31, Year
1998 1997 1996 1995<F2> ended
----------------- ----------------- ----------------- ----------------- October
Series Series Series Series Series Series Series Series 31,
A Inst'l. A Inst'l. A Inst'l. A Inst'l. 1994
------- ------- ------- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $44.36 $44.70 $41.38 $41.58 $41.40 $41.47 $33.19 $33.19 $32.34
Income from investment operations:
Net investment income (0.24)<F9>(0.14)<F9>(0.20)<F7>(0.11)<F7>(0.13)<F7>(0.04)<F7> (0.07) 0.00 0.04
Net realized and unrealized
gains (losses) on securities (2.07) (2.09) 8.44 8.49 4.70 4.74 8.49 8.49 0.85
------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations (2.31) (2.23) 8.24 8.38 4.57 4.70 8.42 8.49 0.89
------- ------- ------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income - - - - - - - - (0.04)
Distributions from capital gains (4.46) (4.46) (5.26) (5.26) (4.59) (4.59) (0.21) (0.21) -
------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions (4.46) (4.46) (5.26) (5.26) (4.59) (4.59) (0.21) (0.21) (0.04)
------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period $37.59 $38.01 $44.36 $44.70 $41.38 $41.58 $41.40 $41.47 $33.19
======= ======= ======= ======= ======= ======= ======= ======= =======
Total return <F3> <F4> (5.91)% (5.66)% 22.18% 22.44% 12.27% 12.58% 25.56% 25.79% 2.77%
Supplemental data and ratios:
Net assets, in thousands,
end of period $136,146 $464,858 $147,396 $569,028 $111,159 $482,857 $87,269 $434,228 $395,584
Ratio of net expenses
to average net assets <F5> <F10> 1.13% 0.88% 1.12% 0.87% 1.13% 0.88% 1.09% 0.90% 0.89%
Ratio of net investment income
to average net assets <F5> <F11> (0.57)% (0.32)% (0.50)% (0.25)% (0.35)% (0.10)% (0.19)% 0.00% 0.13%
Portfolio turnover rate <F3> <F6> 77.39% 77.39% 97.40% 97.40% 103.34% 103.34% 79.25% 79.25% 69.74%
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
EMERGING GROWTH FUND
-------------------------------------------------
Year ended August 15, 1997<F1>
October 31, through
1998 October 31, 1997
----------------- -----------------------
Series Series Series Series
A Institutional A Institutional
------- ------------- ------- --------------
<C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $10.31 $10.31 $10.00 $10.00
Income from investment operations:
Net investment income (loss) 0.03<F9> 0.05<F9> 0.02 0.02
Net realized and unrealized
gains (losses) on securities (0.71) (0.71) 0.29 0.29
------- ------- ------- -------
Total from investment operations (0.68) (0.66) 0.31 0.31
------- ------- ------- -------
Less distributions:
Dividends from net investment income (0.02) (0.02) - -
Distributions from capital gains (0.05) (0.05) - -
------- ------- ------- -------
Total distributions (0.07) (0.07) - -
------- ------- ------- -------
Net asset value, end of period $9.56 $9.58 $10.31 $10.31
======= ======= ======= =======
Total return <F3> <F4> (6.58)% (6.35)% 3.10% 3.10%
Supplemental data and ratios:
Net assets, in thousands, end of period $12,884 $60,400 $5,355 $48,044
Ratio of net expenses to average
net assets <F5> <F10> 1.15% 0.90% 1.15% 0.90%
Ratio of net investment income (loss)
to average net assets <F5> <F11> 0.24% 0.49% 0.93% 1.18%
Portfolio turnover rate <F3> <F6> 132.63% 132.63% 14.51% 14.51%
</TABLE>
<F1> Commencement of operations.
<F2> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareowners exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented
on a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class
of shares based upon the relative net assets of each class of shares as
of the close of business on January 9, 1995, and the results thereof
combined with the results of operations and distributions for each
applicable class for the period January 10, 1995, through October 31,
1995.
<F3> Not annualized for the period ended October 31, 1997, for the Emerging
Growth Fund, for the periods ended October 31, 1996 and June 30, 1996,
for the MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F4> The total return does not reflect the 4% front-end sales charge for
Series A.
<F5> Annualized for the period ended October 31, 1997, for the Emerging Growth
Fund, for the periods ended October 31, 1996 and June 30, 1996, for the
MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F6> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
<F7> Net investment income (loss) per share is calculated using ending
balances prior to consideration of adjustments for permanent book and tax
differences.
<F8> Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors.
<F9> Net investment income (loss) per share represents net investment income
divided by average shares outstanding throughout the year.
<F10> Without fees waived, ratios of net expenses to average net assets for the
Emerging Growth Fund, for the fiscal year ended October 31, 1998 and the
period ended October 31, 1997 would have been 1.42%, 1.17%, 1.59%, and
1.24%, respectively. For the MicroCap Fund the ratios without fees waived
for the fiscal years ended October 31, 1998, 1997, and periods ended
October 31, 1996 and June 30, 1996 would have been 2.06%, 1.81%, 2.03%,
1.78%, 2.04%, 1.79%, 2.22%, and 1.97%, respectively.
<F11> Without fees waived, ratios of net investment income to average net
assets for the Emerging Growth Fund for the fiscal year ended October 31,
1998 and period ended October 31, 1997 would have been (0.03)%, 0.22%,
0.59%, and 0.84%, respectively. For the MicroCap Fund the ratios without
fees waived for the fiscal years ended October 31, 1998, 1997 and periods
ending October 31, 1996 and June 30, 1996 would have been (1.70)%,
(1.45)%, (1.53)%, (1.28)%, (1.76)%, (1.51)%, (0.59)%, and (0.39)%,
respectively.
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
<TABLE>
<CAPTION>
MICROCAP FUND
-----------------------------------------------------------------------------
Year ended Year ended July 1, 1996 August 1, 1995<F1>
October 31, October 31, through through
1998 1997 October 31, 1996 June 30, 1996
----------------- ----------------- ----------------- -----------------
Series Series Series Series Series Series Series Series
A Inst'l. A Inst'l. A Inst'l. A Inst'l.
------- ------- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $17.47 $17.57 $16.16 $16.20 $ 15.42 $ 15.45 $ 10.00 $ 10.00
Income from investment operations:
Net investment income (0.25)<F9>(0.22)<F9>(0.18)<F7>(0.15)<F7>(0.08)<F7>(0.07)<F7> (0.02) (0.02)
Net realized and unrealized
gains (losses) on securities (3.17) (3.19) 4.24 4.27 0.82 0.82 6.10 6.14
------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations (3.42) (3.41) 4.06 4.12 0.74 0.75 6.08 6.12
------- ------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income - - - - - - (0.04) (0.05)
Distributions from capital gains (1.67) (1.67) (2.75) (2.75) - - (0.62) (0.62)
------- ------- ------- ------- ------- ------- ------- -------
Total distributions (1.67) (1.67) (2.75) (2.75) - - (0.66) (0.67)
------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period $12.38 $12.49 $17.47 $17.57 $ 16.16 $ 16.20 $ 15.42 $ 15.45
======= ======= ======= ======= ======= ======= ======= =======
Total return <F3> <F4> (21.71)% (21.51)% 29.78% 30.12% 4.80% 4.85% 63.52% 63.93%
Supplemental data and ratios:
Net assets, in thousands,
end of period $12,419 $72,696 $16,793 $103,840 $ 9,273 $66,368 $9,036 $ 63,595
Ratio of net expenses
to average net assets <F5> <F10> 1.99% 1.74% 1.95% 1.70% 1.97% 1.72% 1.99% 1.74%
Ratio of net investment income
to average net assets <F5> <F11> (1.63)% (1.38)% (1.45)% (1.20)% (1.69)% (1.44)% (0.36)% (0.16)%
Portfolio turnover rate <F3> <F6> 135.61% 135.61% 158.39% 158.39% 64.44% 64.44% 283.67% 283.67%
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
---------------------------------------------------------------------------------------
Year ended Year ended Year ended Year ended
October 31, October 31, October 31, October 31, Year
1998 1997 1996 1995<F2> ended
----------------- ----------------- ----------------- ----------------- October
Series Series Series Series Series Series Series Series 31,
A Inst'l. A Inst'l. A Inst'l. A Inst'l. 1994
------- ------- ------- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
Per Share Data:
Net asset value,
beginning of period $18.58 $18.64 $20.21 $20.27 $19.15 $19.19 $19.99 $19.99 $20.00
Income from investment operations:
Net investment income 0.20<F9> 0.24<F9> 0.06<F7> 0.10<F7> 0.07<F7> 0.11<F7> 0.08 0.12 0.04
Net realized and unrealized
gains (losses) on securities (3.15) (3.16) (1.10) (1.10) 1.43 1.44 (0.87) (0.87) (0.05)
------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations (2.95) (2.92) (1.04) (1.00) 1.50 1.55 (0.79) (0.75) (0.01)
------- ------- ------- ------- ------- ------- ------- ------- -------
Less distributions:
Dividends from net investment income (0.08) (0.09) (0.13) (0.17) (0.07) (0.10) (0.04) (0.04) -
Distributions from capital gains (0.37) (0.37) (0.46) (0.46) (0.37) (0.37) (0.01) (0.01) -
------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions (0.45) (0.46) (0.59) (0.63) (0.44) (0.47) (0.05) (0.05) -
------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period $15.18 $15.26 $18.58 $18.64 $20.21 $20.27 $19.15 $19.19 $19.99
======= ======= ======= ======= ======= ======= ======= ======= =======
Total return <F3> <F4> (16.16)% (15.97)% (5.30)% (5.10)% 7.95% 8.21% (3.95)% (3.75)% (0.05)%
Supplemental data and ratios:
Net assets, in thousands,
end of period $6,486 $44,670 $6,502 $57,206 $3,769 $43,182 $1,633 $31,187 $23,756
Ratio of net expenses
to average net assets <F5> <F10> 1.75% 1.50% 1.75% 1.50% 1.75% 1.50% 1.70% 1.50% 1.49%
Ratio of net investment income
to average net assets <F5> <F11> 1.12% 1.37% 0.25% 0.50% 0.37% 0.62% 0.46% 0.66% 0.44%
Portfolio turnover rate <F3> <F6> 43.96% 43.96% 97.09% 97.09% 31.57% 31.57% 15.12% 15.12% 6.55%
</TABLE>
<F1> Commencement of operations.
<F2> On January 9, 1995, all previously existing series of shares of each Fund
were reclassified as Series A shares. Effective January 9, 1995,
Institutional shareowners exchanged their Series A shares for the Funds'
Institutional series shares. For the year ended October 31, 1995, the
Financial Highlights ratios of net expenses to average net assets, ratios
of net investment income to average net assets, total return and the per
share income from investment operations and distributions are presented
on a basis whereby the Funds' net investment income, net expenses, net
realized and unrealized gains (losses) and distributions for the period
November 1, 1994, through January 9, 1995, were allocated to each class
of shares based upon the relative net assets of each class of shares as
of the close of business on January 9, 1995, and the results thereof
combined with the results of operations and distributions for each
applicable class for the period January 10, 1995, through October 31,
1995.
<F3> Not annualized for the period ended October 31, 1997, for the Emerging
Growth Fund, for the periods ended October 31, 1996 and June 30, 1996,
for the MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F4> The total return does not reflect the 4% front-end sales charge for
Series A.
<F5> Annualized for the period ended October 31, 1997, for the Emerging Growth
Fund, for the periods ended October 31, 1996 and June 30, 1996, for the
MicroCap Fund, and for the period ended October 31, 1994, for the
International Equity Fund.
<F6> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
<F7> Net investment income (loss) per share is calculated using ending
balances prior to consideration of adjustments for permanent book and tax
differences.
<F8> Effective September 2, 1997, Hansberger Global Investors assumed the
investment sub-advisory responsibilities of State Street Global Advisors
<F9> Net investment income (loss) per share represents net investment income
divided by average shares outstanding throughout the year.
<F10> Without fees waived, ratios of net expenses to average net assets for the
fiscal years ended October 31, 1998, 1997, 1996, 1995 and for the period
ended October 31, 1994 would have been 2.16%, 1.92%, 2.50%, 2.25%, 2.61%,
2.36%, 2.85%, 2.65%, and 2.85%, respectively.
<F11> Without fees waived, ratios of net investment to average net assets for
the fiscal years ended October 31, 1998, 1997, 1996, 1995 and for the
period ended October 31, 1994 would have been 0.71%, 0.96%, (0.50)%,
(0.25)%, (0.48)%, (0.24)%, (0.69)%, (0.49)%, and (0.92)%, respectively.
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
YEAR ENDED OCTOBER 31, 1998
<TABLE>
<CAPTION>
BALANCED GROWTH EQUITY
GROWTH AND INCOME INDEX GROWTH
FUND FUND FUND FUND
-------- -------- -------- --------
<C> <C> <C> <C>
INVESTMENT INCOME:
Dividend income:
Domestic $ 693 $ 9,037 $ 7,195 $ 1,128
Foreign - - - -
Interest income:
Domestic 6,078 2,856 1,660 1,230
Foreign - - - -
Other income 22 12 6 53
-------- -------- -------- --------
6,793 11,905 8,861 2,411
-------- -------- -------- --------
EXPENSES:
Investment advisory fees 1,749 4,513 1,256 1,663
Administration fees 255 658 549 242
Shareowner servicing and accounting costs 128 203 154 94
Service organization fees _ Series A 136 415 244 81
Custody fees 77 105 101 46
Federal and state registration fees 26 46 39 19
Professional fees 32 32 31 30
Reports to shareowners 36 90 52 22
Amortization of organization costs - - - -
Directors' fees and expenses 7 8 8 8
Other 6 18 15 6
-------- -------- -------- --------
Total expenses before waiver 2,452 6,088 2,449 2,211
Less: Waiver of expenses (567) (424) (533) (156)
-------- -------- -------- --------
Net Expenses 1,885 5,664 1,916 2,055
-------- -------- -------- --------
NET INVESTMENT INCOME 4,908 6,241 6,945 356
-------- -------- -------- --------
REALIZED AND UNREALIZED GAIN:
Net realized gain on:
Investments 7,539 48,714 1,439 26,680
Foreign currency - - - -
Net change in unrealized appreciation on:
Investments 5,444 37,014 81,804 10,510
Foreign currency - - - -
-------- -------- -------- --------
Net gain on investments
and foreign currency 12,983 85,728 83,243 37,190
-------- -------- -------- --------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $17,891 $91,969 $90,188 $37,546
======== ======== ======== ========
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
STATEMENT OF OPERATIONS
(AMOUNTS IN THOUSANDS)
YEAR ENDED OCTOBER 31, 1998
<TABLE>
<CAPTION> SPECIAL EMERGING INTERNATIONAL
GROWTH GROWTH MICROCAP EQUITY
FUND FUND FUND FUND
-------- -------- -------- --------
<C> <C> <C> <C>
INVESTMENT INCOME:
Dividend income:
Domestic $ 1,797 $ 552 $ 188 -
Foreign(net of withholding taxes of $184) - - - $ 1,773
Interest income:
Domestic 2,028 376 208 -
Foreign - - - 58
Other income 80 - - -
-------- -------- -------- --------
3,905 928 396 1,831
-------- -------- -------- --------
EXPENSES:
Investment advisory fees 5,243 501 1,688 861
Administration fees 762 73 123 70
Shareowner servicing and accounting costs 274 77 92 106
Service organization fees - Series A 383 24 40 17
Custody fees 145 41 41 97
Federal and state registration fees 43 24 9 30
Professional fees 34 33 35 36
Reports to shareowners 115 18 29 7
Amortization of organization costs - 4 5 5
Directors' fees and expenses 7 8 7 8
Other 18 4 4 3
Total expenses before waiver 7,024 807 2,073 1,240
Less: Waiver of expenses (493) (182) (82) (264)
-------- -------- -------- --------
Net Expenses 6,531 625 1,991 976
-------- -------- -------- --------
NET INVESTMENT INCOME (LOSS) (2,626) 303 (1,595) 855
-------- -------- -------- --------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments 3,773 (6,752) (275) (5,124)
Foreign currency - - - (23)
Net change in unrealized appreciation
(depreciation) on:
Investments (33,543) 875 (21,884) (7,356)
Foreign currency - - - 5
-------- -------- -------- --------
Net (loss) on investments
and foreign currency (29,770) (5,877) (22,159) (12,498)
-------- -------- -------- --------
NET (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $(32,396) $(5,574) $(23,754) $(11,643)
======== ======== ======== ========
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
COMMON STOCKS 56.7%
AEROSPACE & AIRCRAFT 0.8%
43,000 Gulfstream Aerospace Corporation <F1> $1,903
----------
AIR TRANSPORTATION 0.8%
4,600 COMAIR Holdings, Inc. 151
32,700 FDX Corporation <F1> 1,719
2,600 SkyWest, Inc. 66
----------
1,936
----------
AUTO & TRUCK 0.0%
2,000 Applied Power, Inc. - Class A 55
----------
BANKING 1.1%
13,637 Charter One Financial, Inc. 374
14,300 Fifth Third Bancorp 947
24,100 First Union Corporation 1,398
2,600 Peoples Heritage Financial Group, Inc. 47
----------
2,766
----------
BUSINESS MACHINES & SOFTWARE 2.7%
69,400 Cadence Design Systems, Inc. <F1> 1,483
8,800 HNC Software, Inc. <F1> 296
41,650 Network Associates, Inc.<F1> 1,770
20,900 Sterling Commerce, Inc. <F1> 737
51,100 Synopsys, Inc.<F1> 2,312
----------
6,598
----------
BUSINESS SERVICES 8.1%
51,300 ABR Information Services, Inc. <F1> 968
6,600 Affiliated Computer Services, Inc.<F1> 244
14,100 Cambridge Technology Partners, Inc. <F1> 313
49,900 Ciber, Inc. <F1> 979
27,000 Cintas Corporation 1,444
21,100 Computer Sciences Corporation<F1> 1,113
37,100 Concord EFS, Inc. <F1> 1,057
35,500 First Data Corporation 941
42,587 FIserv, Inc. <F1> 1,980
17,400 F.Y.I. Incorporated <F1> 500
71,800 Gartner Group, Inc.<F1> 1,427
10,500 International Telecommunications Data Systems, Inc. 251
24,500 Mastech Corporation <F1> 576
25,500 National Data Corporation 864
7,400 NCO Group, Inc.<F1> 233
3,700 PAREXEL International Corporation<F1> 82
8,700 Pharmaceutical Product Development, Inc.<F1> 235
54,400 Pittston Brink's Group 1,618
27,650 Robert Half International, Inc. <F1> 1,109
9,600 Sabre Group Holdings, Inc. <F1> 362
88,200 SunGard Data Systems, Inc. 2,977
47,900 Sykes Enterprises, Inc.<F1> 940
----------
20,213
----------
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
CHEMICALS 0.1%
11,900 Sigma-Aldrich Corporation $368
----------
COMMUNICATIONS & MEDIA 1.5%
33,300 Interpublic Group of Companies, Inc. 1,948
38,100 Inter-Tel, Incorporated 688
22,200 Omnicom Group, Inc. 1,098
----------
3,734
----------
COMPUTERS 2.1%
11,900 CDW Computer Centers, Inc. <F1> 892
15,200 Compaq Computer Corporation 481
10,400 Dell Computer Corporation <F1> 681
28,100 Ingram Micro Inc.<F1> 1,279
47,000 Tech Data Corporation <F1> 1,851
----------
5,184
----------
CONSUMER PRODUCTS 0.5%
26,300 Newell Company 1,157
----------
DATA PROCESSING 1.0%
61,500 Axciom Corporation <F1> 1,545
4,500 CSG Systems International, Inc. <F1> 245
21,300 National Computer Systems, Inc. 596
----------
2,386
----------
DRUGS\ MEDICAL SUPPLIES 2.1%
16,600 Barr Laboratories, Inc.<F1> 568
12,300 Elan Corporation PLC ADR <F1> 862
9,200 Merck & Co., Inc. 1,244
17,900 Warner-Lambert Company 1,403
19,100 Watson Pharmaceuticals, Inc.<F1> 1,062
----------
5,139
----------
ELECTRIC EQUIPMENT 0.0%
10,200 Amkor Technology, Inc.<F1> 50
----------
ELECTRONICS & SCIENTIFIC INSTRUMENTS1.0%
18,525 Cisco Systems, Inc. <F1> 1,167
32,110 Molex, Inc. - Class A 1,050
20,150 Seitel, Inc.<F1> 267
----------
2,484
----------
ENTERTAINMENT & LEISURE 0.7%
23,300 American Skiing Company<F1> 208
2,100 Cinar Films Inc. - Class B <F1> 44
8,700 Family Golf Centers, Inc.<F1> 183
23,100 Imax Corporation<F1> 592
3,000 Steiner Leisure Ltd.<F1> 73
23,300 The Walt Disney Company 628
----------
1,728
----------
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
- ---------- --------------
FINANCIAL SERVICES 6.5%
53,075 ARM Financial Group, Inc. - Class A $ 1,018
12,100 Associates First Capital Corporation 853
16,600 The BISYS Group, Inc.<F1> 726
16,050 Citigroup Inc. 755
3,000 CMAC Investment Corporation 126
15,800 Federal National Mortgage Association 1,119
16,700 Financial Security Assurance Holdings Ltd. 832
20,600 Franklin Resources, Inc. 779
16,200 Kansas City Southern Industries, Inc. 626
60,500 MBNA Corporation 1,380
1,300 Medallion Financial Corp. 23
67,200 The Charles Schwab Corporation 3,221
2,300 SEI Investments Company 190
31,600 State Street Corporation 1,971
23,350 SunAmerica, Inc. 1,646
26,200 T. Rowe Price Associates, Inc. 932
----------
16,197
----------
FUNERAL SERVICES 0.1%
12,900 Stewart Enterprises, Inc. 298
----------
HEALTH CARE SERVICES & SUPPLIES 5.8%
9,350 Cardinal Health, Inc. 884
17,800 Covance Inc.<F1> 496
7,300 First Health Group Corporation<F1> 168
31,650 HCR Manor Care, Inc.<F1> 1,029
113,153 Health Management Associates, Inc. - Class A <F1> 2,016
37,900 Healthsouth Corporation 460
3,100 IDX Systems Corporation<F1> 131
19,300 IMS Health Incorporated 1,283
43,400 Lincare Holdings, Inc. <F1> 1,733
19,400 Medtronic, Inc. 1,261
15,500 Henry Schein, Inc. <F1> 600
29,500 Shared Medical Systems Corporation 1,471
11,500 STERIS Corporation<F1> 265
21,200 Stryker Corporation 889
30,700 Universal Health Services, Inc. - Class B<F1> 1,575
----------
14,261
----------
HOSPITAL SUPPLIES & SERVICES 0.7%
47,200 Omnicare, Inc. 1,631
----------
HOUSING 0.4%
47,000 Toll Brothers, Inc. <F1> 1,090
----------
INDUSTRIAL DISTRIBUTION 0.1%
12,000 MSC Industrial Direct Co., Inc. - Class A <F1> 255
----------
INSURANCE 4.4%
28,500 AFLAC, Inc. 1,087
40,100 AMBAC, Inc. 2,333
9,600 Amerin Corporation<F1> 205
11,100 Chartwell Re Corporation 276
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
INSURANCE 4.4% (CONT.)
18,275 Enhance Financial Services Group, Inc. $449
13,200 Executive Risk Incorporated 627
21,500 MBIA, Inc. 1,314
40,300 MGIC Investment Corporation 1,572
74,000 Protective Life Corporation 2,743
10,000 Terra Nova (Bermuda) Holdings Ltd. 278
----------
10,884
----------
LODGING 0.1%
2,490 Promus Hotel Corporation <F1> 84
----------
MEDICAL INSTRUMENTS 0.3%
7,900 Sofamor Danek Group, Inc. <F1> 803
----------
MULTI-INDUSTRY 1.8%
36,400 Leggett & Platt, Inc. 851
59,800 Tyco International, Ltd. 3,704
----------
4,555
----------
NATURAL GAS 0.5%
23,700 Enron Corporation 1,250
----------
OIL & GAS - DOMESTIC 0.2%
5,700 Denbury Resources, Inc.<F1> 37
40,450 Forest Oil Corporation<F1> 412
----------
449
----------
OIL & GAS - SERVICES 0.1%
3,400 Newpark Resources, Inc. <F1> 32
19,770 Swift Energy Company <F1> 180
----------
212
----------
POLLUTION CONTROL 0.1%
27,000 Tetra Technologies, Inc. <F1> 326
----------
REAL ESTATE INVESTMENT TRUSTS (REIT'S) 0.2%
18,800 Golf Trust of America, Inc. 503
----------
RESTAURANTS 0.1%
9,100 Papa John's International, Inc.<F1> 346
----------
RETAIL 4.2%
4,000 Abercrombie & Fitch Co.<F1> 159
81,000 Bed Bath and Beyond, Inc. <F1> 2,233
27,100 Costco Companies, Inc. <F1> 1,538
25,407 Dollar General Corporation 607
3,500 Eagle Hardware & Garden, Inc. <F1> 81
10,100 Federated Department Stores, Inc. <F1> 388
38,500 Food Lion, Inc. - Class A 424
59,100 Goody's Family Clothing, Inc. <F1> 632
17,100 Home Depot, Inc. 744
20,200 Lowe's Companies, Inc. 680
3,400 The Men's Wearhouse, Inc. <F1> 82
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
RETAIL 4.2% (CONT.)
4,600 Office Depot, Inc.<F1> $115
37,300 Safeway, Inc. <F1> 1,783
24,800 Staples, Inc.<F1> 809
15,400 Stein Mart, Inc. <F1> 121
2,600 Whole Foods Market, Inc.<F1> 104
----------
10,500
----------
SCHOOLS 0.5%
20,500 Apollo Group, Inc. <F1> 659
19,650 Sylvan Learning Systems, Inc. <F1> 607
----------
1,266
----------
SECURITY SERVICES 0.4%
18,200 Corrections Corporation of America <F1> 350
5,800 The Wackenhut Corporation - Class A 126
21,300 Wackenhut Corrections Corporation<F1> 523
----------
999
----------
SEMICONDUCTORS 1.2%
16,100 Intel Corporation 1,436
39,200 Maxim Integrated Products, Inc. <F1> 1,399
----------
2,835
----------
SHIPBUILDING 0.2%
19,500 Avondale Industries, Inc.<F1> 508
----------
SOFTWARE 1.3%
55,400 Avant! Corporation<F1> 945
7,800 Compuware Corporation<F1> 424
8,400 Electronic Arts, Inc.<F1> 345
13,700 HBO & Company 360
10,500 Microsoft Corporation <F1> 1,112
9,500 Software AG Systems, Inc.<F1> 142
----------
3,328
----------
TELECOMMUNICATIONS 1.4%
38,500 Cincinnati Bell, Inc. 999
46,024 MCI WorldCom, Inc.<F1> 2,543
----------
3,542
----------
TELECOMMUNICATIONS EQUIPMENT 0.6%
11,800 Lucent Technologies, Inc. 946
28,400 World Access, Inc.<F1> 607
----------
1,553
----------
TEXTILES & APPAREL 0.8%
59,600 Jones Apparel Group, Inc. <F1> 1,028
19,800 Polo Ralph Lauren Corporation <F1> 412
10,300 Tommy Hilfiger Corporation<F1> 478
1,400 Wolverine World Wide, Inc. 18
----------
1,936
----------
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
- ---------- --------------
TRANSPORTATION 0.9%
54,800 Harley-Davidson, Inc. $2,123
----------
TRAVEL & RECREATION 0.7%
51,200 Carnival Corporation - Class A 1,658
----------
WASTE MANAGEMENT 0.6%
32,600 Waste Management, Inc. 1,472
----------
Total Common Stocks (Cost $105,739) 140,565
----------
PREFERRED STOCK 0.1%
TELECOMMUNICATIONS 0.1%
7,400 MediaOne Group, Inc. (convertible to Enhance 310
Financial Services Group common stock) ----------
Total Preferred Stock (Cost $321) 310
----------
Principal Amount
(in thousands)
- --------------
LONG-TERM INVESTMENTS 34.0%
ASSET-BACKED SECURITIES 5.3%
AUTO LOAN RECEIVABLES 0.1%
Western Financial Grantor Trust,
$ 97 Series 1995-2, Class A-1, 7.10%, 7/01/00 98
----------
CREDIT CARD RECEIVABLES 5.2%
Banc One Credit Card Master Trust,
1,750 Series 1995-B, Class A, 6.30%, 9/15/00 1,795
Chase Credit Card Master Trust,
2,300 Series 1995-2, Class XX, 6.23%, 6/15/03 2,359
Chemical Master Credit Card Trust I,
500 Series 1996-1, Class A, 5.55%, 9/15/03 507
Citibank Credit Card Master Trust, Principal Only:
3,300 Series 1996-1, 0.00%, 2/07/01 2,953
200 Series 1997-6, Class A, 0.00%, 8/15/06 144
First Chicago Master Trust II,
1,150 Series 1994-L, Class A, 7.15%, 2/15/00 1,170
Household Affinity Credit Card Master Trust I,
500 Series 1993-2, Class A, 5.60%, 11/15/00 505
HFC Private Label Credit Card Master Trust II,
175 Series 1994-2, Class A, 7.80%, 9/20/03 177
Sears Credit Account Master Trust:
2,475 Series 1994-1, Class A, 7.00%, 8/15/00 2,519
700 Series 1995-2, Class A, 8.10%, 1/15/01 724
----------
12,853
----------
CORPORATE BONDS 7.9%
Atlantic Richfield Co. Debentures,
300 8.50%, 4/01/12 379
BankAmerica Corporation Subordinated Notes,
350 7.75%, 7/15/02 376
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Principal Amount Market Value
(in thousands) (in thousands)
- -------------- --------------
CORPORATE BONDS 7.9% (CONT.)
Barclays American Corp. Debentures,
$ 250 9.75%, 5/15/21 $286
Chase Manhattan Corporation Debentures,
250 10.00%, 6/15/99 257
Commonwealth Edison Debentures,
900 9.875%, 6/15/20 1,074
Continental Bank Subordinated Notes,
300 12.50%, 4/01/01 345
Continental Cablevision, Inc. Debentures:
350 8.875%, 9/15/05 400
600 9.50%, 8/01/13 714
Dayton Hudson Corporation Debentures,
250 10.00%, 1/01/11 330
Deseret Generation & Transmission Coop
191 Debentures, 9.375%, 1/02/11 199
Dresdner Bank New York Subordinated Debentures,
800 7.25%, 9/15/15 802
Federal Express Corporation Debentures,
250 9.625%, 10/15/19 266
Federal Express Corporation Notes,
500 9.65%, 6/15/12 667
Ford Capital BV Notes,
250 10.125%, 11/15/00 274
General Motors Acceptance Corp. Medium Term Notes,
1,000 6.70%, 4/30/01 1,034
Georgia Pacific Corporation Debentures:
300 9.50%, 12/01/11 371
300 9.875%, 11/01/21 335
100 9.50%, 5/15/22 114
Goldman Sachs Group Notes,
1,500 6.25%, 2/01/03 (Acquired 2/01/96;
Cost $1,496) <F2> 1,519
GTE Corporation Debentures,
250 10.25%, 11/01/20 285
Heller Financial, Inc. Notes,
350 7.875%, 11/01/99 356
Lehman Brothers Holdings, Inc. Notes:
350 6.65%, 11/08/99 354
300 8.875%, 2/15/00 311
Lehman Brothers, Inc. Debentures,
700 9.875%, 10/15/00 721
Lehman Brothers, Inc. Senior Subordinated Notes,
700 10.00%, 5/15/99 714
The May Department Stores Company Debentures,
300 9.875%, 6/15/21 344
NCNB Corporation Subordinated Notes,
750 10.20%, 7/15/15 1,008
News America Holdings, Inc., Debentures,
300 10.125%, 10/15/12 352
Oneok, Inc. Debentures,
400 9.70%, 12/01/19 432
Paine Webber Group Notes,
500 8.875%, 3/15/05 558
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Principal Amount Market Value
(in thousands) (in thousands)
- -------------- --------------
CORPORATE BONDS 7.9% (CONT.)
J.C. Penney Company, Inc. Debentures,
$ 625 9.75%, 6/15/21 $ 703
Rochester Telephone Debentures,
400 9.00%, 8/15/21 450
Salomon, Inc. Senior Notes:
350 7.75%, 5/15/00 360
575 6.75%, 2/15/03 590
Salomon Smith Barney Holdings, Inc. Notes,
700 6.875%, 6/15/05 725
The Charles Schwab Corporation Medium
550 Term Notes, 5.90%, 10/01/99 551
Tenneco, Inc. Debentures,
425 7.45%, 12/15/25 451
U.S. West Communications Group Debentures,
575 8.875%, 6/01/31 651
----------
19,658
----------
MORTGAGE-BACKED SECURITIES 0.3%
Westam Mortgage Financial Corporation,
830 Series 11, Class A, 6.36%, 8/26/20 860
----------
INTERNATIONAL/YANKEE (U.S. $ DENOMINATED) 1.9%
Ford Capital BV Debentures,
325 9.875%, 5/15/02 371
Hydro-Quebec Debentures:
350 11.75%, 2/01/12 518
500 9.75%, 1/15/18 576
Korea Development Bank Bonds,
285 7.125%, 9/17/01 253
Korea Electric Power Debentures:
290 7.75%, 4/01/13 196
200 6.75%, 8/01/27 155
Midland Bank PLC Subordinated Notes,
950 6.95%, 3/15/11 902
National Bank of Hungary Debentures,
250 8.875%, 11/01/13 272
Norsk Hydro A/S Debentures,
350 9.00%, 4/15/12 449
Pohang Iron & Steel Notes,
200 7.125%, 7/15/04 155
Quebec (Province of) Debentures,
250 11.00%, 6/15/15 279
Sweden (Kingdom of) Debentures,
150 11.125%, 6/01/15 229
Wharf Capital International Ltd. Notes:
325 8.875%, 11/01/04 260
225 7.625%, 3/13/07 159
----------
4,774
----------
BALANCED GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Principal Amount Market Value
(in thousands) (in thousands)
- -------------- --------------
U.S. GOVERNMENT AGENCY-BACKED MORTGAGE ISSUES 1.4%
Federal Home Loan Mortgage Corporation (FHLMC)
Real Estate Mortgage Investment Conduit (REMIC):
$ 447 Series 85, Class C, 8.60%, 1/15/21 $464
U.S. GOVERNMENT AGENCY-BACKED
MORTGAGE ISSUES 1.4% (CONT.)
520 Series 1169, Class D, 7.00%, 5/15/21 524
638 Series 1136, Class H, 6.00%, 9/15/21 638
518 Series 1201, Class E, 7.40%, 12/15/21 529
Federal National Mortgage Association (FNMA)
Real Estate Mortgage Investment Conduit (REMIC):
466 Series 1989-37, Class XX, 8.00%, 7/25/19 481
416 Series 1990-30, Class E, 6.50%, 3/25/20 420
434 Series 1990-105, Class J, 6.50%, 9/25/20 438
----------
3,494
----------
U.S. TREASURY OBLIGATIONS 17.2%
U.S. Treasury Bonds:
6,725 0.00%, 11/15/04 5,102
6,525 10.75%, 8/15/05 8,819
19,860 9.25%, 2/15/16 28,665
----------
42,586
----------
Total Long-Term Investments (Cost $78,733) 84,323
----------
Number
of Shares
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 10.0%
INVESTMENT COMPANIES 8.8%
9,630 Financial Square Prime Obligation Fund 9,630
12,013 Short-Term Investments Co. Liquid
Assets Portfolio 12,013
----------
21,643
----------
Principal Amount Market Value
(in thousands) (in thousands)
- -------------- --------------
VARIABLE RATE DEMAND NOTES 1.2%
$ 3,000 Pitney Bowes Demand Note $ 3,000
----------
Total Short-Term Investments (Cost $24,643) 24,643
----------
Total Investments (Cost $209,436) 100.8% 249,841
----------
Liabilities, less Other Assets (0.8)% (2,061)
----------
TOTAL NET ASSETS 100.0% $247,780
==========
<F1>Non-income producing
<F2>Unregistered Security
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTARFUNDS
GROWTH AND INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
COMMON STOCKS 83.8%
APPLIANCES 1.4%
194,200 Maytag Corporation $ 9,601
----------
BANKING 7.6%
573,800 Bank of New York 18,111
109,400 Mellon Bank Corporation 6,578
143,700 Northern Trust Corporation 10,598
418,100 Norwest Corporation 15,548
----------
50,835
----------
BUILDING MATERIALS 1.0%
144,000 Martin Marietta Materials, Inc. 7,065
----------
BUSINESS MACHINES & SOFTWARE 2.3%
105,200 Diebold, Inc. 3,281
121,800 Xerox Corporation 11,799
----------
15,080
----------
BUSINESS SERVICES 2.8%
87,300 Automatic Data Processing, Inc. 6,793
167,100 H & R Block, Inc. 7,488
195,800 The ServiceMaster Company 4,136
----------
18,417
----------
CHEMICALS 1.8%
208,900 Ecolab, Inc. 6,241
72,000 Praxair, Inc. 2,911
92,000 Valspar Corporation 2,582
----------
11,734
----------
COMMUNICATIONS & MEDIA 4.1%
269,350 Interpublic Group of Companies, Inc. 15,757
397,700 New York Times Company - Class A 11,235
----------
26,992
----------
CONSUMER PRODUCTS 3.7%
140,100 Avery Dennison Corporation 5,805
52,600 The Clorox Company 5,746
60,800 Masco Corporation 1,717
259,950 Newell Company 11,438
----------
24,706
----------
CONSUMER SERVICES 1.6%
298,538 Service Corporation International 10,635
----------
CONTAINERS 0.8%
145,100 Bemis Company, Inc. 5,387
----------
COSMETICS & SOAP 4.7%
218,400 Avon Products, Inc. 8,668
133,600 Estee Lauder Companies - Class A 8,759
GROWTH AND INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
COSMETICS & SOAP 4.7% (CONT.)
51,300 Gillette Company $ 2,305
129,350 Procter & Gamble Company 11,496
----------
31,228
----------
DRUGS & MEDICAL SUPPLY 14.8%
175,500 American Home Products Corporation 8,556
145,200 Baxter International, Inc. 8,703
243,800 Becton, Dickinson & Company 10,270
126,100 Bristol-Myers Squibb Company 13,942
101,600 Johnson & Johnson 8,280
213,750 McKesson Corporation 16,459
120,800 Medtronic, Inc. 7,852
125,300 Pfizer, Inc. 13,446
137,900 Warner-Lambert Company 10,808
----------
98,316
----------
ELECTRIC - UTILITIES 1.3%
293,200 NIPSCO Industries, Inc. 8,778
----------
FINANCIAL SERVICES 7.4%
338,100 Alliance Capital Management L.P. 8,389
73,100 American Express Company 6,460
96,350 Citigroup Inc. 4,534
263,075 Equifax 10,178
126,000 Federal National Mortgage Association 8,922
132,300 Household International, Inc. 4,837
101,200 Marsh & McLennan Companies, Inc. 5,612
----------
48,932
----------
FOOD, BEVERAGES & TOBACCO 0.8%
1,000 McCormick & Company, Incorporated 30
159,500 PepsiCo, Inc. 5,383
----------
5,413
----------
INSURANCE 3.6%
176,800 MBIA, Inc. 10,807
304,900 ReliaStar Financial Corporation 13,358
----------
24,165
----------
MULTI-INDUSTRY 5.7%
150,200 Dover Corporation 4,774
45,700 Illinois Tool Works Inc. 2,931
70,000 Pentair, Inc. 2,634
18,900 Teleflex Incorporated 727
431,900 Tyco International, Ltd. 26,751
----------
37,817
----------
NATURAL GAS 1.2%
149,000 Enron Corporation 7,860
OIL - DOMESTIC 0.8%
127,800 Phillips Petroleum Company 5,527
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTARFUNDS
GROWTH AND INCOME FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
OIL - INTERNATIONAL 1.5%
129,950 Mobil Corporation $9,836
----------
PAPER & FOREST PRODUCTS 0.6%
78,200 Kimberly-Clark Corporation 3,773
----------
PRINTING & PUBLISHING 3.0%
187,800 Houghton Mifflin Company 7,324
140,600 McGraw-Hill, Inc. 12,645
----------
19,969
----------
REAL ESTATE INVESTMENT TRUSTS (REIT'S) 2.8%
109,400 Boston Properties, Inc. 3,118
228,000 CCA Prison Realty Trust 5,358
152,900 Post Properties, Inc. 5,915
185,000 ProLogis Trust 4,035
----------
18,426
----------
RETAIL 6.5%
66,800 Albertson's, Inc. 3,712
319,100 CVS Corporation 14,579
186,600 Gap, Inc. 11,219
205,375 Hannaford Brothers Company 8,998
95,300 Longs Drug Stores Corporation 3,723
17,700 Walgreen Company 862
----------
43,093
----------
TELECOMMUNICATIONS 1.0%
142,900 ALLTEL Corporation 6,690
----------
TELECOMMUNICATIONS EQUIPMENT 1.0%
86,596 Lucent Technologies, Inc. 6,944
----------
Total Common Stock (Cost $368,027) 557,219
----------
PREFERRED STOCK 0.6%
FINANCIAL SERVICES 0.6%
61,500 PLC Capital Trust II
(convertible to Protective Life Corporation
common stock) 3,828
----------
Total Preferred Stock (Cost $3,208) 3,828
----------
Principal Amount
(in thousands)
- --------------
LONG-TERM INVESTMENTS 0.3%
CORPORATE CONVERTIBLE BONDS 0.3%
$1,884 Imax Corporation,
5.75%, 4/01/03 (convertible to IMAX Corporation
common stock) 2,367
----------
Total Long-Term Investments (Cost $2,439) 2,367
----------
Number
of Shares Market Value
(in thousands) (in thousands)
- -------------- --------------
SHORT-TERM INVESTMENTS 14.2%
INVESTMENT COMPANIES 8.9%
28,080 Financial Square Prime Obligation Fund $ 28,080
31,255 Short-Term Investments Co. Liquid
Assets Portfolio 31,255
----------
59,335
----------
Principal Amount
(in thousands)
- --------------
VARIABLE RATE DEMAND NOTES 5.3%
$ 20,000 American Family Insurance 20,000
15,000 Warner-Lambert Co. 15,000
----------
35,000
----------
Total Short-Term Investments (Cost $94,335) 94,335
----------
Total Investments (Cost $468,009) 98.9% 657,749
----------
Other Assets, less Liabilities 1.1% 7,185
----------
TOTAL NET ASSETS 100.0% $664,934
==========
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
COMMON STOCKS 95.2%
AEROSPACE & AIRCRAFT 1.7%
34,100 Allied Signal, Inc. $ 1,328
61,626 Boeing Company 2,311
7,700 General Dynamics Corporation 456
11,834 Lockheed Martin Corporation 1,318
3,800 Northrop Grumman Corporation 303
20,900 Raytheon Company 1,214
12,600 Rockwell International Corporation 517
10,000 Textron, Inc. 744
14,000 United Technologies Corporation 1,333
----------
9,524
----------
AIR TRANSPORTATION 0.5%
11,600 AMR Corporation <F1> 777
4,600 Delta Air Lines, Inc. 486
9,500 FDX Corporation <F1> 499
19,050 Southwest Airlines Company 404
6,200 US Airways Group, Inc. <F1> 351
----------
2,517
----------
APPLIANCES 0.2%
3,300 Armstrong World Industries, Inc. 205
5,300 Black & Decker Corporation 274
6,200 Maytag Corporation 306
3,100 Snap-On Tools, Inc. 110
4,600 Whirlpool Corporation 236
----------
1,131
----------
AUTOS & TRUCKS 1.9%
10,100 Autozone, Inc.<F1> 266
39,350 Chrysler Corporation 1,894
10,038 Dana Corporation 420
4,500 Eaton Corporation 305
74,000 Ford Motor Company 4,014
42,400 General Motors Corporation 2,674
11,237 Genuine Parts Company 354
7,200 ITT Industries, Inc. 257
4,240 PACCAR, Inc. 185
8,200 TRW, Inc. 467
----------
10,836
----------
BANKING 7.8%
71,094 Banc One Corporation 3,475
17,900 Bank of Boston Corporation 659
45,200 Bank of New York Company, Inc. 1,427
105,507 BankAmerica Corporation 6,060
6,000 Bankers Trust New York Corporation 377
17,400 BB&T Corporation 621
52,020 Chase Manhattan Corporation 2,955
138,868 Citigroup, Inc. 6,535
9,300 Comerica, Inc. 600
16,050 Fifth Third Bancorp 1,063
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
- ---------- --------------
BANKING 7.8% (CONT.)
59,128 First Union Corporation $ 3,429
34,742 Fleet Financial Group, Inc. 1,388
12,900 Huntington Bancshares Incorporated 371
10,900 J.P. Morgan & Co., Inc. 1,027
15,900 Mellon Bank Corporation 956
9,200 Mercantile Bancorporation, Inc. 420
6,800 Northern Trust Corporation 501
46,200 Norwest Corporation 1,718
18,300 PNC Bank Corporation 915
12,700 Regions Financial Corporation 470
6,600 Republic New York Corporation 276
9,800 State Street Corporation 611
11,600 Summit Bancorp. 440
12,900 Sun Trust Banks, Inc. 899
17,100 Synovus Financial Corp. 397
45,355 US Bancorp 1,655
7,400 Union Planters Corporation 344
12,300 Wachovia Corporation 1,118
33,837 Washington Mutual, Inc. 1,267
5,233 Wells Fargo & Company 1,936
----------
43,910
----------
BIO-TECHNOLOGY 0.2%
15,100 Amgen, Inc. <F1> 1,186
----------
BUILDING & HOUSING 0.2%
4,600 Fluor Corporation 178
20,400 Masco Corporation 575
6,100 The Stanley Works 183
----------
936
----------
BUILDING MATERIALS 0.1%
4,800 Johnson Controls, Inc. 270
4,900 Owens Corning 178
----------
448
----------
BUSINESS MACHINES & SOFTWARE 3.3%
8,100 Apple Computer, Inc. <F1> 301
100,809 COMPAQ Computer Corporation 3,188
7,700 Honeywell, Inc. 615
57,500 International Business Machines Corporation 8,535
58,912 Oracle Systems Corporation <F1> 1,742
16,900 Pitney-Bowes, Inc. 931
22,600 Sun Microsystems, Inc. <F1> 1,316
20,050 Xerox Corporation 1,942
----------
18,570
----------
BUSINESS SERVICES 2.5%
3,300 Autodesk, Inc. 103
18,700 Automatic Data Processing, Inc. 1,455
5,700 H & R Block, Inc. 255
4,400 Ceridian Corporation <F1> 252
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
BUSINESS SERVICES 2.5% (CONT.)
93,600 Cisco Systems, Inc. <F1> $ 5,897
32,787 Computer Associates International, Inc. 1,291
9,500 Computer Sciences Corporation <F1> 501
4,700 Deluxe Corporation 152
10,921 Dun & Bradstreet Corporation 310
31,000 Electronic Data Systems Corporation 1,261
9,000 Equifax Inc. 348
27,200 First Data Corporation 721
3,600 Moore Corporation Limited 41
2,600 National Service Industries 93
10,700 Paychex, Inc. 532
15,100 Service Corporation International 538
15,000 Unisys Corporation<F1> 399
----------
14,149
----------
CHEMICALS 2.0%
14,300 Air Products and Chemicals, Inc. 540
13,700 Dow Chemical Company 1,283
68,800 Dupont (E.I.) De Nemours & Company 3,956
7,900 Ecolab, Inc. 236
3,100 Great Lakes Chemical Corporation 129
5,300 Hercules, Inc. 176
1,800 Millipore Corporation 44
36,500 Monsanto Company 1,483
6,900 Morton International, Inc. 172
5,100 Nalco Chemical Company 158
10,600 PPG Industries, Inc. 606
10,400 Praxair, Inc. 419
11,100 Rohm & Haas Company 375
8,500 Rubbermaid, Inc. 282
10,100 Sherwin-Williams Company 254
6,300 Sigma-Aldrich Corporation 195
8,350 Union Carbide Corporation 321
25,900 The Williams Companies, Inc. 711
----------
11,340
----------
COMMUNICATIONS & MEDIA 2.4%
4,350 Andrew Corporation <F1> 71
43,800 CBS Corporation<F1> 1,224
14,800 Clear Channel Communications, Inc. <F1> 674
22,500 Comcast Corporation - Class A 1,111
6,500 Dow Jones & Company, Inc. 298
17,000 Gannett Company, Inc. 1,052
4,300 Harcourt General, Inc. 209
8,350 Interpublic Group of Companies, Inc. 488
5,000 Knight-Ridder, Inc. 255
37,153 MediaOne Group, Inc. <F1> 1,572
10,800 New York Times Company - Class A 305
10,400 Omnicom Group, Inc. 514
30,900 Tele-Communications, Inc. - Class A <F1> 1,302
36,000 Time Warner, Inc. 3,341
6,023 Times Mirror Company - Class A 334
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
- ---------- --------------
COMMUNICATIONS & MEDIA 2.4% (CONT.)
7,400 Tribune Company $ 426
----------
13,176
----------
COMPUTERS 1.4%
78,200 Dell Computer Corporation <F1> 5,122
30,400 EMC Corporation <F1> 1,957
9,500 Gateway 2000, Inc.<F1> 530
13,900 Seagate Technology, Inc. <F1> 367
9,400 Silicon Graphics, Inc. <F1> 106
----------
8,082
----------
CONSUMER DURABLES 0.3%
4,637 Eastman Chemical Company 272
19,450 Eastman Kodak Company 1,507
2,128 Polaroid Corporation 56
----------
1,835
----------
CONSUMER PRODUCTS 0.2%
7,200 Avery Dennison Corporation 298
9,700 Newell Company 427
18,800 RJR Nabisco Holdings Corp. 537
3,200 Tupperware Corporation 50
----------
1,312
----------
CONTAINERS 0.1%
4,500 Bemis Company, Inc. 167
6,900 Crown Cork & Seal Company, Inc. 220
8,900 Owens-Illinois, Inc. <F1> 272
4,904 Sealed Air Corporation<F1> 174
----------
833
----------
COSMETICS & SOAP 2.4%
15,800 Avon Products, Inc. 627
6,100 Clorox Company 666
18,100 Colgate-Palmolive Company 1,599
68,488 Gillette Company 3,078
6,600 International Flavors & Fragrances, Inc. 247
81,800 Procter & Gamble Company 7,270
----------
13,487
----------
DISTRIBUTION 0.0%
9,358 Ikon Office Solutions, Inc. 88
----------
DIVERSIFIED 0.5%
39,100 Unilever N.V. 2,942
----------
DRUGS 10.2%
94,200 Abbott Laboratories 4,421
4,800 Allergan, Inc. 300
5,300 Alza Corporation <F1> 254
80,100 American Home Products Corporation 3,905
3,100 Bard (C.R.), Inc. 132
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands
---------- --------------
DRUGS 10.2% (CONT.)
17,100 Baxter International, Inc. $ 1,025
14,400 Becton, Dickinson & Company 607
60,720 Bristol-Meyers Squibb Company 6,713
6,700 Cardinal Health, Inc. 634
9,500 Humana, Inc. <F1> 180
82,000 Johnson & Johnson 6,683
67,600 Eli Lilly & Company 5,471
28,600 Medtronic, Inc. 1,859
72,900 Merck & Company, Inc. 9,860
79,700 Pfizer, Inc. 8,553
30,955 Pharmacia & Upjohn, Inc. 1,639
44,800 Schering-Plough 4,609
5,400 St. Jude Medical, Inc. <F1> 153
18,800 Tenet Healthcare Corporation <F1> 525
----------
57,523
----------
ELECTRIC 0.9%
11,000 The AES Corporation 450
7,700 Ameren Corporation 307
9,632 CINenergy Corporation 332
14,400 Consolidated Edison Company of New York, Inc. 722
22,028 Duke Power Company 1,425
21,400 Edison International 564
7,600 General Public Utilities Corporation 328
17,300 PacifiCorp 330
17,100 Texas Utilities Company 748
----------
5,206
----------
ELECTRICAL EQUIPMENT 3.5%
11,688 AMP, Inc. 480
26,600 Emerson Electric Company 1,756
198,800 General Electric Company # 17,395
5,600 Grainger (W.W.), Inc. 258
----------
19,889
----------
ELECTRONICS 3.4%
4,200 Harris Corporation 147
63,200 Hewlett-Packard Company 3,804
103,500 Intel Corporation 9,231
36,500 Motorola, Inc. 1,898
8,500 National Semiconductor Corporation <F1> 108
40,980 Northern Telecom Ltd. 1,754
3,500 Perkin-Elmer Corporation 295
3,450 Tektronix, Inc. 62
23,400 Texas Intruments, Inc. 1,496
3,400 Thomas & Betts Corporation 152
----------
18,947
----------
ENERGY 1.8%
11,600 American Electric Power Company 568
10,250 Baltimore Gas & Electric Company 322
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands
---------- --------------
ENERGY 1.8% (CONT.)
9,900 Carolina Power & Light Company $ 454
14,100 Central & South West Corporation 392
13,450 Coastal Corporation 474
5,800 Consolidated Natural Gas Company 306
12,400 Dominion Resources, Inc. 573
8,900 DTE Energy Company 379
14,900 Entergy Corporation 428
14,100 FirstEnergy Corp. 423
11,100 FPL Group, Inc. 694
18,572 Houston Industries, Inc. 577
11,600 Niagara Mohawk Power Corporation <F1> 170
3,300 NICOR, Inc. 140
9,000 Northern States Power Company 243
24,700 Pacific Gas & Electric Company 752
15,400 Peco Energy Company 596
14,200 Public Service Enterprises Group, Inc. 540
14,017 Sempra Energy 364
6,400 Sonat, Inc. 194
42,500 Southern Company 1,198
13,200 Unicom Corporation 497
----------
10,284
----------
ENERGY - RAW MATERIALS 0.3%
19,990 Baker Hughes, Inc. 441
26,200 Halliburton Company 942
22,400 Occidental Petroleum Corporation 445
----------
1,828
----------
ENTERTAINMENT & LEISURE 1.0%
7,700 Brunswick Corporation 150
8,125 Hasbro, Inc. 285
17,887 Mattel, Inc. 642
41,900 McDonald's Corporation 2,802
10,200 Mirage Resorts, Incorporated <F1> 173
21,785 Viacom, Inc. - Class B <F1> 1,304
8,050 Wendy's International, Inc. 169
----------
5,525
----------
ENVIRONMENTAL SERVICES 0.0%
22,100 Laidlaw, Inc. - Class B 209
----------
FINANCE 1.2%
28,100 American Express Company 2,483
7,000 The Bear Stearns Companies Inc. 250
29,906 Household International, Inc. 1,093
7,200 Lehman Brothers Holdings, Inc. 273
21,100 Merrill Lynch & Company, Inc. 1,250
19,700 National City Corporation 1,267
----------
6,616
----------
FINANCIAL SERVICES 2.4%
21,145 Associates First Capital Corporation - Class A 1,491
4,100 Capital One Financial Corporation 417
18,915 Conseco, Inc. 656
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
FINANCIAL SERVICES 2.4% (CONT.)
6,600 Countrywide Credit Industries, Inc. $ 285
63,300 Federal National Mortgage Association 4,482
15,000 Franklin Resources, Inc. 567
6,000 MBIA, Inc. 367
45,862 MBNA Corporation 1,046
36,566 Morgan Stanley Group, Inc. 2,368
10,400 SLM Holding Corporation 417
11,900 SunAmerica, Inc. 839
17,400 The Charles Schwab Corporation 834
----------
13,769
----------
FOOD, BEVERAGES & TOBACCO 6.3%
36,008 Archer-Daniels-Midland Company 601
17,600 Bestfoods 959
27,300 Campbell Soup Company 1,455
150,600 Coca-Cola Company 10,184
24,000 Coca-Cola Enterprises Inc. 865
28,450 ConAgra, Inc. 866
9,800 Dardeen Restaurants, Inc. 162
10,000 Fortune Brands, Inc. 331
9,500 General Mills, Inc. 698
21,900 Heinz (H.J.) Company 1,273
8,300 Hershey Foods Corporation 563
25,000 Kellogg Company 825
21,300 Lowe's Companies, Inc 718
91,000 PepsiCo, Inc. 3,071
148,200 Philip Morris Companies, Inc. 7,577
14,000 Pioneer Hi-Bred International, Inc. 392
8,500 Quaker Oats Company 502
19,200 Ralston-Ralston Purina Group 641
28,300 Sara Lee Corporation 1,689
20,600 Sysco Corporation 555
9,320 Tricon Global Restaurants, Inc. <F1> 405
10,900 UST, Inc. 371
6,800 Wrigley (Wm) Jr. Company 550
----------
35,253
----------
GOLD & PRECIOUS METALS 0.2%
21,200 Barrick Gold Corporation 453
3,500 Cyprus Amax Minerals Company 44
9,600 Freeport McMoRan Copper & Gold, Inc. 118
12,600 Homestake Mining Company 150
15,261 Placer Dome, Inc. 240
----------
1,005
----------
HEALTH CARE SERVICES & SUPPLIES 1.4%
2,900 Bausch & Lomb, Inc. 121
11,500 Boston Scientific Corporation <F1> 626
39,228 Columbia/HCA Healthcare Corporation 824
26,200 HBO & Company 688
3,400 HCR Manor Care, Inc.<F1> 110
25,700 HEALTHSOUTH Corporation <F1> 312
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
HEALTH CARE SERVICES & SUPPLIES 1.4% (CONT.)
9,821 IMS Health Incorporated $ 653
11,800 United Healthcare Corporation 514
50,000 Warner-Lambert Company 3,919
----------
7,767
----------
HOSPITAL SUPPLIES & SERVICES 0.0%
6,500 Biomet, Inc. 221
----------
HOUSEHOLD PRODUCTS 0.1%
12,800 Federated Department Stores <F1> 492
----------
INSURANCE 3.6%
8,894 Aetna Life and Casualty Company 664
51,246 Allstate Corporation 2,207
15,200 American General Corporation 1,041
64,048 American International Group, Inc. 5,460
10,300 Aon Corporation 639
10,300 Chubb Corporation 633
13,100 CIGNA Corporation 955
10,200 Cincinnati Financial Corporation 381
4,700 General Re Corporation 1,033
14,400 The Hartford Financial Services Group, Inc. 765
6,225 Jefferson-Pilot Corporation 378
26,304 KeyCorp 797
6,100 Lincoln National Corporation 463
15,960 Marsh & McLennan Companies, Inc. 886
6,400 MGIC Investment Corporation 250
4,400 Progressive Corporation 648
8,300 Provident Companies, Inc. 241
6,400 Providian Corporation 508
9,400 SAFECO Corporation 407
14,332 St. Paul Companies, Inc. 475
7,900 Torchmark Corporation 346
3,700 Transamerica Corporation 385
8,000 UNUM Corporation 355
----------
19,917
----------
LIQUOR 0.5%
29,300 Anheuser-Busch Companies, Inc. 1,742
4,200 Brown-Foreman Corporation - Class B 285
21,100 Seagram Company Ltd. 694
----------
2,721
----------
MACHINERY - AGRICULTURE & AUTOMOTIVE 0.0%
3,700 Case Equipment 81
----------
MACHINERY - INDUSTRIAL 0.1%
3,400 Harnischfeger Industries, Inc. 32
3,700 McDermott International, Inc. 108
9,500 Thermo Electron Corporation <F1> 189
----------
329
----------
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
MEDICAL INSTRUMENTS 0.1%
9,200 Guidant Corporation $ 704
----------
METALS & MINERALS 0.2%
12,160 Allegheny Teledyne, Inc. 250
6,200 Nucor Corporation 281
17,266 USX Corporation-Marathon Group, Inc. 564
4,793 USX Corporation-US Steel Group, Inc. 111
5,125 Worthington Industries, Inc. 70
----------
1,276
----------
MISCELLANEOUS 0.7%
22,300 Applied Materials, Inc. <F1> 774
4,100 Mallinckrodt Group, Inc. 117
10,400 PP&L Resources, Inc. 282
22,700 3 Com Corporation <F1> 819
24,700 3M Corporation 1,976
----------
3,968
----------
MULTI-INDUSTRY 0.8%
51,941 Cendant Corporation<F1> 594
13,900 Corning, Inc. 505
7,000 Loews Corporation 658
9,624 Tenneco, Inc. 292
39,174 Tyco International, Ltd. 2,426
----------
4,475
----------
NATURAL GAS 0.2%
20,000 Enron Corporation 1,055
----------
NON-FERROUS METALS 0.4%
13,250 Alcan Aluminum Ltd. 335
11,400 Aluminum Company of America 903
1,200 ASARCO, Inc. 26
8,800 Englehard Corporation 185
8,100 Inco, Ltd. 87
9,436 Newmont Mining Corporation 201
3,300 Phelps Dodge Corporation 190
5,200 Reynolds Metals Company 312
----------
2,239
----------
OFFICE EQUIPMENT 0.1%
21,500 Novell, Inc. <F1> 320
----------
OIL - DOMESTIC 1.4%
5,600 Amerada Hess Corporation 309
58,200 Amoco Corporation 3,266
7,300 Anadarko Petroleum Corporation 247
4,600 Ashland, Inc. 221
19,200 Atlantic Richfield Company 1,322
11,892 Burlington Resources, Inc. 490
5,050 Columbia Gas System, Inc. 292
3,400 Kerr-McGee Corporation 136
4,900 Oryx Energy Company <F1> 69
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
OIL - DOMESTIC 1.4% (CONT.)
2,400 Pennzoil Company $ 86
15,800 Phillips Petroleum Company 683
4,400 Rowan Companies, Inc. <F1> 64
5,700 Sun Company, Inc. 196
15,500 Unocal Corporation 526
----------
7,907
----------
OIL - INTERNATIONAL 4.7%
7,400 Apache Corporation 210
39,900 Chevron Corporation 3,252
149,300 Exxon Corporation 10,638
47,700 Mobil Corporation 3,610
130,800 Royal Dutch Petroleum Company 6,442
33,000 Texaco, Inc. 1,957
----------
26,109
----------
OIL & GAS SERVICES 0.3%
30,400 Schlumberger, Ltd. 1,596
15,338 Union Pacific Resources Group 199
----------
1,795
----------
PAPER & FOREST PRODUCTS 0.9%
2,500 Boise Cascade Corporation 70
5,500 Champion International Corporation 176
13,400 Fort James Corporation 540
5,600 Georgia-Pacific Corporation 290
18,800 International Paper Company 873
34,012 Kimberly-Clark Corporation 1,641
4,972 Louisiana Pacific Corporation 88
6,200 Mead Corporation 196
3,250 Temple-Inland, Inc. 158
4,050 Union Camp Corporation 174
6,825 Westvaco Corporation 168
12,650 Weyerhaeuser Company 592
5,800 Willamette Industries 180
----------
5,146
----------
POLLUTION CONTROL 0.1%
11,200 Browning-Ferris Industries, Inc. 397
----------
PRINTING & PUBLISHING 0.2%
6,300 McGraw-Hill, Inc. 567
9,300 R.R. Donnelley & Sons Company 401
----------
968
----------
PRODUCTION 0.8%
1,200 Briggs & Stratton Corporation 56
22,100 Caterpillar, Inc. 995
7,800 Cooper Industries, Inc. 344
16,200 Deere & Company 573
13,600 Dover Corporation 432
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
PRODUCTION 0.8% (CONT.)
1,900 FMC Corporation <F1> $ 97
1,600 Foster Wheeler Corporation 25
15,600 Illinois Tool Works, Inc. 1,000
10,100 Ingersoll-Rand Company 510
6,366 Pall Corporation 161
6,525 Parker-Hannifin Corporation 232
4,700 Raychem Corporation 144
4,900 Timken Company 87
----------
4,656
----------
RAILROADS 0.5%
28,743 Burlington Northern Santa Fe 887
13,620 CSX Corporation 535
23,100 Norfolk Southern Corporation 761
14,700 Union Pacific Corporation 700
----------
2,883
----------
RETAIL 5.1%
15,000 Albertson's, Inc. 833
4,400 American Greetings Corporation 177
16,700 American Stores Company 544
6,800 Circuit City Stores, Inc. 246
6,000 Consolidated Stores Corporation<F1> 99
13,121 Costco Companies, Inc.<F1> 745
26,200 Dayton Hudson Corporation 1,110
6,600 Dillard Department Stores, Inc. - Class A 205
10,625 Dollar General Corporation 254
9,000 Fred Meyer, Inc. <F1> 480
23,700 Gap, Inc. 1,425
89,700 Home Depot, Inc. 3,902
28,500 Kmart Corporation <F1> 403
9,600 Kohl's Corporation<F1> 459
15,600 Kroger Corporation <F1> 866
15,911 The Limited, Inc. 408
14,076 The May Department Stores Company <F1> 859
8,400 Nordstrom, Inc. 229
15,300 J.C. Penney Company, Inc. 727
3,300 Pep Boys-Manny, Moe & Jack 52
15,700 Rite Aid Corporation 623
23,800 Sears Roebuck and Company 1,070
16,900 Staples, Inc. <F1> 551
7,000 Supervalu, Inc. 168
5,700 Tandy Corporation 283
19,500 TJX Companies, Inc. 369
17,025 Toys 'R' Us, Inc. <F1> 333
6,600 Venator Group, Inc. 56
30,300 Walgreen Company 1,475
137,000 Wal-Mart Stores, Inc. 9,453
9,500 Winn-Dixie Stores, Inc. 322
----------
28,726
----------
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
SAVINGS & LOAN 0.5%
41,400 Federal Home Loan Mortgage Corporation $ 2,380
3,400 Golden West Financial Corporation 308
----------
2,688
----------
SEMICONDUCTORS 0.2%
7,500 Advanced Micro Devices, Inc. <F1> 169
4,500 KLA-Tencor Corporation <F1> 166
7,100 LSI Logic Corp <F1> 107
13,500 Micron Technology Incorporated 513
----------
955
----------
SOFTWARE 3.0%
3,300 Adobe Systems Incorporated 123
12,000 BMC Software, Inc. <F1> 577
150,300 Microsoft Corporation <F1> 15,913
16,200 Parametric Technology Company <F1> 269
14,400 PeopleSoft, Inc. <F1> 305
----------
17,187
----------
TELECOMMUNICATIONS 8.7%
34,900 Airtouch Communications, Inc. <F1> 1,954
16,100 Alltell Corporation 754
67,100 Ameritech Corporation 3,619
108,856 AT&T Corporation 6,776
11,400 Ascend Communications, Inc. <F1> 550
94,708 Bell Atlantic Corporation 5,031
59,100 BellSouth Corp. 4,717
7,300 Cabletron Systems <F1> 83
10,400 Frontier Corporation 313
58,700 GTE Corporation 3,445
79,992 Lucent Technologies, Inc. 6,414
107,580 MCI WorldCom, Inc.<F1> 5,944
16,200 Nextel Communications, Inc.<F1> 294
112,188 SBC Communications, Inc. 5,196
26,300 Sprint Corporation 2,019
30,645 US West, Inc. 1,758
----------
48,867
----------
TELECOMMUNICATIONS EQUIPMENT 0.2%
8,400 General Instrument Corporation<F1> 216
11,800 Tellabs, Inc. <F1> 649
----------
865
----------
TEXTILES & APPAREL 0.4%
22,800 CVS Corporation 1,042
4,100 Fruit of The Loom, Inc. <F1> 63
3,600 Liz Claiborne, Inc. 106
17,300 Nike, Inc. - Class B 756
2,600 Reebok International Ltd. 43
2,000 Russell Corporation 49
7,454 VF Corporation 312
----------
2,371
----------
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
EQUITY INDEX FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
TIRE & RUBBER 0.1%
4,800 Cooper Tire & Rubber Company $ 80
4,100 Goodrich (B.F.) Company 148
9,562 Goodyear Tire & Rubber Company 515
----------
743
----------
TRANSPORTATION EQUIPMENT 0.0%
1,700 Cummins Engine Company, Inc. 58
1,160 SPX Corporation 63
----------
121
----------
TRAVEL & RECREATION 0.7%
124,800 The Walt Disney Company 3,362
4,950 Harrahs Entertainment, Inc. <F1> 70
14,700 Hilton Hotels Corporation 295
15,300 Marriott International, Inc. - Class A 411
----------
4,138
----------
TRUCKING 0.0%
3,550 Ryder System, Inc. 87
----------
WASTE MANAGEMENT 0.3%
34,440 Waste Management, Inc. 1,554
----------
Total Common Stock (Cost $303,431) 536,084
----------
Principal Amount
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 4.9%
U.S. TREASURIES 0.3%
$ 2,000 U.S. Treasury Bill, 4.29%, 1/21/99 1,980
----------
Total U.S. Treasuries (Cost $1,980) 1,980
----------
VARIABLE RATE DEMAND NOTES 4.6%
13,801 American Family Financial Services, Inc. <F2> 13,801
11,797 Warner-Lambert Co. <F2> 11,797
----------
Total Variable Rate Demand Notes (Cost $25,598) 25,598
----------
Total Short-Term Investments (Cost $27,578) 27,578
----------
Total Investments (Cost $331,009) 100.1% 563,662
----------
Other Assets, less Liabilities (0.1)% (781)
----------
TOTAL NET ASSETS 100.0% $ 562,881
==========
<F1> Non-income producing
<F2> All or a portion of shares have been committed as collateral for open
option futures contracts.
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
COMMON STOCKS 86.5%
AEROSPACE & AIRCRAFT 2.3%
120,800 Gulfstream Aerospace Corporation <F1> $ 5,345
----------
AIR TRANSPORTATION 1.2%
54,400 FDX Corporation <F1> 2,859
----------
BANKING 5.2%
40,600 Fifth Third Bancorp 2,690
68,200 First Union Corporation 3,956
91,400 State Street Corporation 5,701
----------
12,347
----------
BUSINESS MACHINES & SOFTWARE 1.4%
29,400 Microsoft Corporation <F1> 3,113
4,500 Sterling Commerce, Inc. <F1> 159
----------
3,272
----------
BUSINESS SERVICES 10.1%
75,700 Cintas Corporation 4,050
61,100 Computer Sciences Corporation<F1> 3,223
99,600 First Data Corporation 2,639
153,300 Pittston Brink's Group 4,561
26,000 Sabre Group Holdings, Inc. <F1> 982
247,700 SunGard Data Systems, Inc. <F1> 8,360
----------
23,815
----------
CHEMICALS 0.4%
32,300 Sigma-Aldrich Corporation 998
----------
COMMUNICATIONS & MEDIA 3.6%
93,500 Interpublic Group of Companies, Inc. 5,470
62,100 Omnicom Group, Inc. 3,070
----------
8,540
----------
COMPUTERS 2.9%
42,600 Compaq Computers Corporation 1,347
30,200 Dell Computer Corporation <F1> 1,978
75,900 Ingram Micro Inc.<F1> 3,453
----------
6,778
----------
CONSUMER PRODUCTS 1.4%
73,100 Newell Company 3,216
----------
DRUGS 5.5%
34,600 Elan Corporation, PLC ADR <F1> 2,424
26,300 Merck & Co., Inc. 3,557
50,200 Warner-Lambert Company 3,934
53,500 Watson Pharmaceuticals, Inc.<F1> 2,976
----------
12,891
----------
ELECTRONICS & SCIENTIFIC INSTRUMENTS 2.6%
52,650 Cisco Systems, Inc. <F1> 3,317
----------
GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
ELECTRONICS & SCIENTIFIC INSTRUMENTS 2.6% (CONT.)
89,970 Molex, Inc. - Class A $ 2,941
----------
6,258
----------
FINANCIAL SERVICES 7.6%
34,000 Associates First Capital Corporation 2,397
45,185 Citigroup Inc. 2,127
41,600 Federal National Mortgage Association 2,946
57,700 Franklin Resources, Inc. 2,182
165,075 MBNA Corporation 3,766
65,600 SunAmerica, Inc. 4,625
----------
18,043
----------
HEALTH CARE SERVICES & SUPPLIES 7.8%
26,300 Cardinal Health, Inc. 2,487
84,250 HCR Manor Care, Inc.<F1> 2,738
106,300 Healthsouth Corporation<F1> 1,289
54,100 IMS Health Incorporated 3,598
56,600 Lincare Holdings, Inc. <F1> 2,260
54,400 Medtronic, Inc. 3,536
59,500 Stryker Corporation 2,495
----------
18,403
----------
INSURANCE 3.9%
79,950 AFLAC, Inc. 3,048
58,600 MBIA, Inc. 3,582
64,300 MGIC Investment Corporation 2,508
----------
9,138
----------
LODGING 0.1%
6,760 Promus Hotel Corporation <F1> 227
----------
MULTI-INDUSTRY 5.4%
102,200 Leggett & Platt, Inc. 2,389
167,900 Tyco International, Ltd. 10,399
----------
12,788
----------
NATURAL GAS 1.5%
66,500 Enron Corporation 3,508
----------
RETAIL 8.4%
11,000 Abercrombie & Fitch Co.<F1> 437
60,400 Bed Bath & Beyond, Inc. <F1> 1,665
76,000 Costco Companies, Inc. <F1> 4,313
26,500 Federated Department Stores, Inc. <F1> 1,019
101,200 Food Lion, Inc. - Class A 1,113
48,000 Home Depot, Inc. 2,088
56,800 Lowe's Companies, Inc. 1,913
97,900 Safeway, Inc. <F1> 4,681
79,500 Staples, Inc.<F1> 2,594
----------
19,823
----------
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
SEMICONDUCTORS 1.6%
43,400 Intel Corporation $ 3,871
----------
SOFTWARE 0.5%
21,200 Compuware Corporation<F1> 1,153
----------
TELECOMMUNICATIONS 3.7%
57,900 Cincinnati Bell, Inc. 1,502
129,148 MCI WorldCom, Inc.<F1> 7,135
----------
8,637
----------
TELECOMMUNICATIONS EQUIPMENT 1.1%
33,900 Lucent Technologies, Inc. 2,718
----------
TEXTILES & APPAREL 1.0%
55,700 Polo Ralph Lauren Corporation <F1> 1,159
28,100 Tommy Hilfiger Corporation<F1> 1,305
----------
2,464
----------
TRANSPORTATION 2.8%
168,700 Harley-Davidson, Inc. 6,536
----------
TRAVEL & RECREATION 2.7%
143,900 Carnival Corporation - Class A 4,659
65,500 The Walt Disney Company 1,764
----------
6,423
----------
WASTE MANAGEMENT 1.8%
91,500 Waste Management, Inc. 4,129
----------
Total Common Stock (Cost $136,350) 204,180
----------
SHORT-TERM INVESTMENTS 13.1%
INVESTMENT COMPANIES 8.9%
9,693 Financial Square Prime Obligation Fund 9,693
11,303 Short-Term Investments Co.
Liquid Assets Portfolio 11,303
----------
Total Investment Companies (Cost $20,996) 20,996
----------
Principal Amount Market Value
(in thousands) (in thousands)
- -------------- --------------
VARIABLE RATE DEMAND NOTES 4.2%
$ 5,000 American Family Financial Services, Inc. $ 5,000
5,000 Warner-Lambert Co. 5,000
----------
Total Variable Rate Demand Notes (Cost $10,000) 10,000
----------
Total Short-Term Investments (Cost $30,996) 30,996
----------
Total Investments (Cost $167,346) 99.6% 235,176
----------
Other Assets, less Liabilities 0.4% 835
----------
TOTAL NET ASSETS 100.0% $236,011
==========
<F1>Non-income producing
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
SPECIAL GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
COMMON STOCKS 89.3%
AUTO & TRUCK 0.1%
29,200 Applied Power, Inc. - Class A $ 805
----------
BUSINESS SERVICES 14.8%
170,500 Cambridge Technologies Partners, Inc. <F1> 3,786
633,900 Ciber, Inc. <F1> 12,440
447,625 Concord EFS, Inc. <F1> 12,757
51,400 CSG Systems International, Inc.<F1> 2,801
563,550 Fiserv, Inc. <F1> 26,205
862,900 Gartner Group, Inc. - Class A <F1> 17,150
343,650 Robert Half International, Inc. <F1> 13,789
----------
88,928
----------
COMPUTERS 3.8%
579,000 Tech Data Corporation <F1> 22,797
----------
FINANCIAL SERVICES 9.8%
196,800 Kansas City Southern Industries, Inc. 7,601
320,100 T. Rowe Price Associates, Inc. 11,384
832,200 The Charles Schwab Corporation 39,894
----------
58,879
----------
FUNERAL SERVICES 0.6%
152,400 Stewart Enterprises, Inc. 3,515
----------
HEALTH CARE SERVICES & SUPPLIES 13.0%
217,200 Covance Inc. <F1> 6,054
84,800 First Health Group Corporation <F1> 1,956
1,396,139 Health Management Associates, Inc. - Class A <F1> 24,869
184,900 Henry Schein, Inc. <F1> 7,153
392,150 Lincare Holdings, Inc. <F1> 15,656
137,200 STERIS Corporation <F1> 3,156
380,800 Universal Health Services, Inc. - Class B <F1> 19,540
----------
78,384
----------
HOSPITAL SUPPLIES & SERVICES 7.4%
171,500 HBO & Company 4,502
561,500 Omnicare, Inc. 19,407
413,000 Shared Medical Systems Corporation 20,598
----------
44,507
----------
HOUSING 2.3%
598,900 Toll Brothers, Inc. <F1> 13,887
----------
INSURANCE 12.1%
511,900 AMBAC, Inc. 29,786
228,500 MGIC Investment Corporation 8,912
921,100 Protective Life Corporation 34,138
----------
72,836
----------
MEDICAL INSTRUMENTS 1.8%
103,800 Sofamor Danek Group, Inc. <F1> 10,549
----------
SPECIAL GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
RESTAURANTS 0.7%
112,700 Papa John's International, Inc. <F1> $ 4,279
----------
RETAIL 4.7%
704,600 Bed Bath and Beyond, Inc. <F1> 19,421
303,171 Dollar General Corporation 7,238
56,600 Office Depot, Inc. <F1> 1,415
----------
28,074
----------
SCHOOLS 1.3%
244,450 Apollo Group, Inc. <F1> 7,853
----------
SECURITY SERVICES 0.7%
221,675 Corrections Corporation of America <F1> 4,267
----------
SEMICONDUCTORS 2.6%
432,200 Maxim Integrated Products <F1> 15,424
----------
SOFTWARE 11.5%
881,700 Cadence Design Systems, Inc. <F1> 18,846
105,600 Electronic Arts, Inc. <F1> 4,343
406,825 Network Associates, Inc. <F1> 17,290
636,300 Synopsys, Inc. <F1> 28,793
----------
69,272
----------
TEXTILES & APPAREL 2.1%
721,875 Jones Apparel Group, Inc. <F1> 12,452
----------
Total Common Stock (Cost $397,053) 536,708
----------
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
SPECIAL GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number
of Shares Market Value
(in thousands) (in thousands)
- -------------- --------------
SHORT-TERM INVESTMENTS 11.4%
INVESTMENT COMPANIES 8.1%
22,099 Financial Square Prime Obligation Fund $ 22,099
26,507 Short-Term Investments Co. Liquid
Assets Portfolio 26,507
----------
Total Investment Companies (Cost $48,606) 48,606
----------
Principal Amount
(in thousands)
- --------------
COMMERCIAL PAPER 3.3%
$ 20,000 Merrill Lynch & Company 19,994
----------
Total Commerical Paper (Cost $19,994) 19,994
----------
Total Short-Term Investments (Cost $68,600) 68,600
----------
Total Investments (Cost $465,653) 100.7% 605,308
----------
Liabilities, less Other Assets (0.7)% (4,304)
----------
TOTAL NET ASSETS 100.0% $601,004
==========
<F1> Non-income producing
EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
COMMON STOCKS 78.7%
AIR TRANSPORTATION 0.7%
11,400 COMAIR Holdings, Inc. $ 375
7,100 SkyWest, Inc. 181
----------
556
----------
BUSINESS SERVICES 15.8%
138,500 ABR Information Services, Inc. <F1> 2,614
42,200 The BISYS Group, Inc.<F1> 1,846
46,100 F.Y.I. Incorporated <F1> 1,325
27,200 International Telecommunication Data
Systems, Inc.<F1> 649
63,300 Mastech Corporation <F1> 1,488
18,500 NCO Group, Inc.<F1> 583
6,500 SEI Investments Company 535
131,300 Sykes Enterprises, Inc.<F1> 2,577
----------
11,617
----------
COMPUTERS 3.3%
32,100 CDW Computer Centers, Inc. <F1> 2,405
----------
DATA PROCESSING 11.2%
18,300 Affiliated Computer Services, Inc.<F1> 677
156,380 Axciom Corporation <F1> 3,929
54,000 National Computer Systems, Inc. 1,511
62,300 National Data Corporation 2,110
----------
8,227
----------
DRUGS 2.1%
44,200 Barr Laboratories, Inc.<F1> 1,511
----------
ELECTRICAL EQUIPMENT 0.2%
26,600 Amkor Technology, Inc.<F1> 130
----------
ENTERTAINMENT & LEISURE 4.0%
65,300 American Skiing Company<F1> 584
5,100 Cinar Films, Inc. - Class B <F1> 108
21,600 Family Golf Centers, Inc.<F1> 455
61,700 Imax Corporation<F1> 1,581
8,500 Steiner Leisure Ltd.<F1> 205
----------
2,933
----------
FINANCIAL SERVICES 3.9%
144,500 ARM Financial Group, Inc. - Class A 2,773
3,500 Medallion Financial Corp. 62
----------
2,835
----------
HEALTH CARE SERVICES & SUPPLIES 1.6%
8,500 IDX Systems Corporation<F1> 360
10,300 PAREXEL International Corporation<F1> 228
22,500 Pharmaceutical Product Development, Inc.<F1> 608
----------
1,196
----------
EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
INSURANCE 10.4%
27,400 Amerin Corporation<F1> $ 586
1,400 Capital Re Corporation 35
28,200 Chartwell Re Corporation 701
8,000 CMAC Investment Corporation 335
52,000 Enhance Financial Services Group, Inc. 1,277
35,300 Executive Risk Incorporated 1,677
45,500 Financial Security Assurance Holdings Ltd. 2,266
26,800 Terra Nova (Bermuda) Holdings Ltd. 744
----------
7,621
----------
OIL & GAS - DOMESTIC 2.3%
15,400 Denbury Resources, Inc.<F1> 101
105,700 Forest Oil Corporation<F1> 1,077
53,205 Swift Energy Company <F1> 486
----------
1,664
----------
OIL & GAS SERVICES 1.0%
55,100 Seitel, Inc. <F1> 730
----------
POLLUTION CONTROL 1.1%
68,700 Tetra Technologies, Inc. <F1> 829
----------
REAL ESTATE INVESTMENT TRUSTS (REIT'S) 1.7%
47,550 Golf Trust of America, Inc. 1,272
----------
RETAIL 3.8%
10,100 Eagle Hardware & Garden, Inc. <F1> 235
159,250 Goody's Family Clothing, Inc. <F1> 1,702
8,300 The Men's Wearhouse, Inc. <F1> 201
42,100 Stein Mart, Inc. <F1> 332
7,200 Whole Foods Market, Inc.<F1> 287
----------
2,757
----------
SCHOOLS 2.1%
49,450 Sylvan Learning Systems, Inc. <F1> 1,527
----------
SECURITY SERVICES 2.3%
16,700 The Wackenhut Corporation - Class A 362
54,000 Wackenhut Corrections Corporation<F1> 1,326
----------
1,688
----------
SHIPBUILDING 1.7%
49,600 Avondale Industries, Inc.<F1> 1,293
----------
SOFTWARE 5.0%
146,600 Avant! Corporation<F1> 2,501
22,600 HNC Software, Inc. <F1> 760
25,200 Software AG Systems, Inc.<F1> 378
----------
3,639
----------
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
EMERGING GROWTH FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
TELECOMMUNICATIONS EQUIPMENT 4.5%
92,900 Inter-Tel, Incorporated $ 1,678
74,900 World Access, Inc.<F1> 1,601
----------
3,279
----------
Total Common Stock (Cost $55,922) 57,709
----------
PREFERRED STOCK 1.1%
FINANCIAL SERVICES 1.1%
MediaOne Group, Inc. (convertible to Enhance
18,700 Financial Services Group common stock) 783
----------
Total Preferred Stock (Cost $821) 783
----------
Number
of Shares
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 14.2%
INVESTMENT COMPANIES 8.7%
3,251 Financial Square Prime Obligation Fund 3,251
3,128 Short-Term Investments Co.
Liquid Assets Portfolio 3,128
----------
Total Investment Companies (Cost $6,379) 6,379
----------
Principal Amount
(in thousands)
- --------------
VARIABLE RATE DEMAND NOTES 5.5%
$ 1,000 American Family Financial Services, Inc. 1,000
2,000 Pitney Bowes 2,000
1,000 Warner-Lambert Co. 1,000
----------
Total Variable Rate Demand Notes (Cost $4,000) 4,000
----------
Total Short-Term Investments (Cost $10,379) 10,379
----------
Total Investments 94.0% (Cost $67,122) 68,871
----------
Other Assets, less Liabilities 6.0% 4,413
----------
TOTAL NET ASSETS 100.0% $73,284
==========
<F1> Non-income producing
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
MICROCAP FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
COMMON STOCKS 92.3%
AIR TRANSPORTATION 0.7%
71,300 Indigo Aviation AB ADR<F1> $ 606
----------
CHILD CARE 1.6%
94,700 Childtime Learning Centers, Inc.<F1> 1,373
----------
COMMERCIAL SERVICES 4.3%
46,600 Kroll-O'Gara Company<F1> 1,148
94,100 ProSoft Development, Inc. <F1> 147
97,500 SteriGenics International, Inc.<F1> 2,377
----------
3,672
----------
COMPUTER SOFTWARE & SERVICES 14.6%
27,600 BroadVision, Inc.<F1> 414
172,100 Condor Technology Solutions, Inc.<F1> 2,280
21,000 Diamond Technologies Partners, Inc.<F1> 270
81,200 Fundtech Ltd.<F1> 1,106
68,700 ISS Group, Inc.<F1> 1,894
46,700 New Horizons Worldwide, Inc.<F1> 864
111,400 Phoenix International Ltd., Inc. <F1> 2,019
169,100 Summit Design, Inc.<F1> 1,416
169,300 Tier Technologies, Inc. - Class B<F1> 2,201
----------
12,464
----------
CONSULTING SERVICES 2.1%
74,100 Hagler Bailly, Inc.<F1> 1,741
----------
COSMETICS & SOAP 1.7%
201,300 French Fragrances, Inc. <F1> 1,409
----------
DATA PROCESSING 1.7%
62,300 Data Processing Resources Corporation<F1> 1,425
----------
DISTRIBUTION 5.6%
100,500 Dynamex Inc.<F1> 697
72,750 Insight Enterprises, Inc.<F1> 2,110
117,150 Pomeroy Computer Resources, Inc. <F1> 1,970
----------
4,777
----------
ENTERTAINMENT & LEISURE 3.1%
107,200 Championship Auto Racing Teams, Inc.<F1> 2,667
----------
EQUIPMENT RENTAL 2.0%
170,800 Coinmach Laundry Corporation <F1> 1,719
----------
FINANCIAL SERVICES 4.8%
70,600 Conning Corporation 1,041
99,800 First Sierra Financial, Inc. <F1> 904
119,800 LINC Capital, Inc.<F1> 854
106,400 T&W Financial Corporation<F1> 1,250
----------
4,049
----------
FOOTWEAR & RELATED APPAREL 0.7%
81,800 Rocky Shoes & Boots, Inc. <F1> 558
----------
HEALTH CARE SERVICES & SUPPLIES 6.1%
17,500 Biomatrix, Inc.<F1> 823
6,600 Province Healthcare Company<F1> 172
203,700 Quadramed Corporation 4,176
----------
5,171
----------
Number Market Value
of Shares (in thousands)
---------- --------------
HUMAN RESOURCES 1.5%
71,000 RemedyTemp, Inc. - Class A<F1> $ 1,296
----------
INSURANCE 2.7%
70,800 ESG Re Ltd. 1,310
94,600 Healthcare Recoveries, Inc. <F1> 958
----------
2,268
----------
MEDICAL INSTRUMENTS 4.1%
141,100 EndoSonics Corporation<F1> 1,085
73,100 Perclose, Inc.<F1> 1,745
35,200 Ventana Medical Systems, Inc.<F1> 651
----------
3,481
----------
MISCELLANEOUS 0.7%
74,600 CulturalAccessWorldwide, Inc.<F1> 633
----------
PRIVATE CORRECTION FACILITIES 7.0%
36,800 Childrens Comprehensive Services, Inc.<F1> 469
336,900 Cornell Corrections, Inc. <F1> 5,517
----------
5,986
----------
REAL ESTATE INVESTMENT TRUSTS (REITS) 5.2%
228,900 Capital Automotive REIT 3,233
61,000 Correctional Properties Trust<F1> 1,186
----------
4,419
----------
RESEARCH & DEVELOPMENT 0.9%
28,400 Kendle International, Inc.<F1> 745
----------
RETAIL 3.1%
89,800 A.C. Moore Arts & Crafts, Inc. <F1> 696
99,950 DM Management Company <F1> 1,087
37,500 Factory Card Outlet Corp. <F1> 159
24,400 Party City Corporation<F1> 419
13,200 Restoration Hardware, Inc.<F1> 266
----------
2,627
----------
RETIREMENT CARE 1.0%
64,800 Assisted Living Concepts, Inc. <F1> 875
----------
SCHOOLS 4.9%
82,300 Career Education Corporation<F1> 2,016
274,500 EduTrek International, Inc.<F1> 1,990
25,300 Quest Education Corporation<F1> 193
----------
4,199
----------
TELECOMMUNICATIONS 7.1%
110,300 Hyperion Telecommunications, Inc.<F1> 1,075
53,000 Metromedia Fiber Network, Inc. <F1> 2,007
27,000 MGC Communications, Inc.<F1> 274
83,000 Transaction Network Services, Inc.<F1> 2,272
31,600 US LEC Corporation - Class A<F1> 413
----------
6,041
----------
TELECOMMUNICATIONS EQUIPMENT 1.5%
61,500 Dset Corporation<F1> 769
22,927 World Access, Inc.<F1> 490
----------
1,259
----------
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
MICROCAP FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
Number Market Value
of Shares (in thousands)
---------- --------------
VETERINARY HOSPITALS 2.6%
124,800 Veterinary Centers of America, Inc. <F1> $ 2,216
----------
VITAMINS & NUTRITIONAL PRODUCTS 1.0%
74,400 Natrol, Inc.<F1> 856
----------
Total Common Stock (Cost $73,949) 78,532
----------
Number
of Shares
(in thousands)
- --------------
SHORT-TERM INVESTMENTS 8.4%
INVESTMENT COMPANIES 4.3%
10 Financial Square Prime Obligation Fund 10
3,637 Short-Term Investments Co. Liquid Assets Portfolio 3,637
----------
Total Investment Companies (Cost $3,647) 3,647
----------
Principal Amount
(in thousands)
- --------------
U.S. TREASURIES 0.6%
$ 500 U.S. Treasury Bill, 4.29%, 1/21/99 495
----------
Total U.S. Treasuries (Cost $495) 495
----------
VARIABLE RATE DEMAND NOTES 3.5%
3,000 American Family Financial Services, Inc. 3,000
----------
Total Variable Rate Demand Notes (Cost $3,000) 3,000
----------
Total Short-Term Investments (Cost $7,142) 7,142
----------
Total Investments (Cost $81,091) 100.7% 85,674
----------
Liabilities, less Other Assets (0.7)% (559)
----------
TOTAL NET ASSETS 100.0% $ 85,115
==========
<F1> Non-income producing
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
<TABLE>
<CAPTION>
Number Market
of Shares Industry Value
---------- -------- ----------
<C> <C> <C> <C>
COMMON AND PREFERRED STOCKS 93.9%
ARGENTINA 1.0%
12,000 Telefonica de Argentina SA ADR Telecommunications $ 396,750
12,000 Transportadora de Gas del Sur SA ADR Natural Gas - Pipeline 123,750
----------
520,500
----------
AUSTRALIA 2.4%
77,000 Broken Hill Proprietary Company Limited Diversified Operations 651,649
44,864 National Australia Bank Ltd. Banks 591,859
----------
1,243,508
----------
AUSTRIA 2.6%
10,287 Bank Austria AG <F1> Banks 559,724
9,000 Boehler- Uddeholm AG Steel 424,044
3,800 VA Technologie AG Engineering 352,211
----------
1,335,979
----------
BRAZIL 1.2%
37,000 Aracruz Celulose SA ADR Paper & Related Products 309,875
160,000 Rhodia-Ster SA GDR <F1> Chemicals 67,056
3,100 Telecomunicacoes Brasileiras SA-Telebras ADR Telecommunications 235,406
----------
612,337
----------
CANADA 3.5%
27,000 The Loewen Group Inc. Funeral Services 241,313
56,500 Moore Corporation Ltd. Business Services 639,156
86,000 Methanex Corporation<F1> Chemicals 500,323
91,000 Noranda Forest, Inc. Building Products - Wood 388,235
----------
1,769,027
----------
CHILE 0.8%
17,500 Cia. de Telecomunicaciones de Chile SA Telecommunications 383,906
----------
CHINA 0.6%
57,000 Shandong Huaneng Power Company Ltd. ADR Electric Utility 292,125
----------
COLUMBIA 0.3%
25,000 Bancolumbia SA Banks 123,438
----------
CROATIA 0.8%
30,000 Pliva d.d. GDR Pharmaceuticals 427,908
----------
CZECH REPUBLIC 1.7%
10,500 The Czech Power Company <F1> Electric Power Company 238,975
96,000 Komercni Banka A.S. ADR Banks 424,022
26,000 Skoda Plzen AS <F1> Building & Construction 173,912
----------
836,909
----------
DENMARK 2.0%
3,500 A/S Forsikringsselskabet Codan Insurance 444,734
7,565 Unidanmark AS Banks 576,756
----------
1,021,490
----------
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTARFUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
<TABLE>
<CAPTION>
Number Market
of Shares Industry Value
---------- -------- ----------
<C> <C> <C> <C>
FINLAND 2.0%
50,200 Kemira Oyj Chemicals $ 413,484
55,020 Merita Ltd. Financial Services 294,844
58,000 Tamro Oyj Drugs 310,813
-----------
1,019,141
-----------
FRANCE 6.3%
3,500 Bail Investissement Real Estate 518,994
10,503 Banque Nationale de Paris Banks 665,120
6,300 Societe Elf Aquitaine SA Oil & Chemicals 728,986
13,000 Rhone-Poulenc SA Drugs 594,216
12,800 Scor Assistance Insurance 733,877
----------
3,241,193
----------
GERMANY 3.7%
11,500 BASF AG Chemicals 487,441
23,000 Bilfinger & Berger Bau AG Building & Construction 458,278
22,500 Tarkett Sommer AG Building & Construction 373,596
850 Viag AG Diversified Manufacturing 577,376
----------
1,896,691
----------
GREAT BRITAIN 12.5%
354,847 The BICC Group PLC Wire & Cable Products 309,028
46,150 British Telecommunciations PLC Telecommunications 596,681
211,250 BTR PLC Diversified Operations 369,714
260,000 BTR PLC - B Shares <F1> Diversified Operations 145,872
254,850 Caradon PLC Building & Construction 533,516
11,409 Coats Viyella PLC Textiles 5,972
66,962 Fairview Holdings PLC <F1> Building & Construction 91,680
133,925 Hillsdown Holdings PLC Food & Beverage 189,527
138,737 LucasVarity PLC Auto & Truck Components 473,997
36,000 National Westminster Bank PLC Banks 608,340
76,500 Nycomed Amersham PLC Medical Products 537,460
209,823 Rolls-Royce PLC <F1> Aerospace & Aircraft 774,845
53,024 Southern Electric PLC Electricity - Distribution 545,248
172,175 Storehouse PLC Retail 501,733
66,962 Terranova Foods PLC <F1> Food & Beverage 131,211
40,159 United Utilities PLC Utility Services 587,824
---------
6,402,648
---------
HONG KONG 6.1%
1,996,000 Giordano International Limited Retail - Apparel/Shoes 239,650
12,000 HSBC Holdings PLC Banks 274,988
121,000 Hutchison Whampoa Limited Diversified Operations 866,986
228,559 Jardine Matheson Holdings Ltd. Diversified Operations 639,965
2,856,000 Pacific Ports Company Ltd. <F1> Traffic Management 261,788
142,000 Peregrine Investments Holdings Limited Financial Services 78,830
927,500 Swire Pacific Ltd. Diversified Operations 766,351
---------
3,128,558
---------
INDIA 0.4%
17,000 BSES Ltd. GDR Electric Utility 209,100
---------
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTARFUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
<TABLE>
<CAPTION>
Number Market
of Shares Industry Value
---------- -------- ----------
<C> <C> <C> <C>
INDONESIA 0.4%
175,000 PT Indonesian Satelite Telecommunications $ 188,821
----------
IRELAND 0.9%
53,480 Irish Life PLC Insurance 474,056
----------
ISRAEL 0.4%
16,000 Koor Industries Limited ADR Telecommunications 259,000
----------
ITALY 2.2%
90,000 Banca Commerciale Italiana Banks 556,525
375 La Rinascente SPA Retail - Food 3,617
153,000 Telecom Italia Mobile SPA Telecommunications 542,626
----------
1,102,768
----------
JAPAN 7.5%
15,000 AOYAMA Trading Co., Ltd. Retail - Apparel/Shoes 370,087
42,000 DAIICHI Pharmaceutical Co., Ltd. Drugs 701,042
80,000 Daito Trust Construction Co. Real Estate 683,106
61,000 Daiwa Securities Company Limited Financial Services 172,750
103,000 Kyudenko Co., Ltd. Electrical Engineering 573,664
255,000 Marubeni Corporation Distribution / Wholesale 468,305
74,600 Nichido Fire & Marine Insurance Insurance 384,759
139,000 Nippon Fire & Marine Insurance Insurance 485,495
----------
3,839,208
----------
MALAYSIA 1.0%
180,000 Malakoff Bhd<F2> Agricultural Operations 197,241
96,000 Malayan Banking Bhd<F2> Banks 81,327
80,000 O.Y.L. Industries Bhd<F2> Air & Heating Systems 114,919
300,000 Road Builder (M) Holdings Bhd<F2> Building & Construction 123,759
----------
517,246
----------
MEXICO 2.0%
51,000 Elamex SA de CV <F1> Manufacturing - Misc. 274,125
14,000 Telefonos de Mexico SA Telecommunications 739,375
----------
1,013,500
----------
NETHERLANDS 4.5%
10,500 Ballast Nedam NV Building & Construction 364,298
6,000 Eriks Holdings NV Diversified Operations 403,170
27,500 European Vinyls Corporation International NV Chemicals 256,197
14,754 Koninklijke Ahrend NV Office & Funiture 299,393
11,922 Koninklijke Pakhoed NV Storage & Transportation 293,630
18,000 Koninklijke KPN NV Telecommunications 699,684
---------
2,316,372
---------
NEW ZEALAND 3.0%
361,000 Air New Zealand Limited - Class B Air Transportation 477,791
781,575 Brierley Investments Limited Diversified Operations 177,922
591,000 Carter Holt Harvey Limited Paper Products 481,836
202,000 Fletcher Challenge Energy Oil & Gas Exploration 372,153
---------
1,509,702
---------
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
<TABLE>
<CAPTION>
Number Market
of Shares Industry Value
---------- -------- ----------
<C> <C> <C> <C>
NORWAY 2.7%
9,500 Bergesen d.y. ASA "B" Transportation $ 128,866
53,000 Saga Petroleum ASA Oil & Gas Exploration 668,611
16,700 Sparebanken NOR Banks 317,146
28,000 Odfjell ASA "A" Marine Services 269,669
-----------
1,384,292
-----------
PAKISTAN 0.4%
5,000 Pakistan Telecom Corporation 144A GDR Telecommunications 191,085
-----------
PERU 0.3%
70,000 Banco Wiese ADR <F1> Banks 126,875
----------
PHILIPPINES 0.8%
24,000 Metropolitan Bank & Trust Company Banks 124,316
12,000 Philippine Long Distance Telephone Company Telecommunications 286,997
---------
411,313
---------
POLAND 0.3%
145,000 Mostostal-Export SA ADR Containers 134,662
---------
PORTUGAL 1.0%
10,500 Electricidade de Portugal, SA ADR <F1> Electric Utility 525,000
---------
RUSSIA 0.7%
8,500 Lukoil Holding ADR Oil & Gas - International 132,099
54,000 Rostelecom ADR Telecommunications 205,875
---------
337,974
---------
SINGAPORE 2.7%
35,000 Asia Pulp & Paper Company Ltd. <F1> Paper Products 290,921
173,000 City Developments Limited Real Estate 626,889
101,000 United Overseas Bank Ltd. Banks 474,542
---------
1,392,352
---------
SLOVAK REPUBLIC 0.9%
13,000 Nafta Gbely AS Geological Exploration 151,951
30,000 Slovakofarma 144A GDR Health & Beauty Aids 96,000
39,000 VSZ AS <F1> Steel 233,486
---------
481,437
---------
SOUTH AFRICA 1.3%
6,016 AngloGold Limited Mining 305,637
124,000 Standard Bank Investment Corporation Limited Banks 373,561
---------
679,198
---------
SOUTH KOREA 0.0%
3,482 Kookmin Bank Banks 12,883
</TABLE>
See notes to the financial statements.
<PAGE>
(LOGO)FIRSTARFUNDS
INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
OCTOBER 31, 1998
<TABLE>
<CAPTION>
Number Market
of Shares Industry Value
---------- -------- ----------
<C> <C> <C> <C>
SPAIN 6.1%
12,000 Catalana Occidente Insurance $ 318,037
17,000 Construcciones y Auxiliar de Ferrocarriles SA Manufacturing - Misc. 566,202
20,900 Corporacion Mapfre Insurance 550,952
53,500 Iberdrola SA Electricity - Distribution 862,501
16,500 Repsol SA Oil & Gas - International 826,662
-----------
3,124,354
-----------
SWEDEN 3.6%
64,000 ABB AB Rail Transit Systems 675,460
19,300 AssiDoman AB Paper & Related Products 365,413
25,000 Astra AB Drugs 404,572
27,000 Getinge Industrier AB "B" Medical Instruments 414,487
----------
1,859,932
----------
SWITZERLAND 2.4%
1,500 Forbo Holding AG Building Products 620,338
558 Holderbank Building Products 621,831
----------
1,242,169
----------
THAILAND 0.9%
355,000 Thai Farmers Bank Public Company Limited Banks 449,258
----------
15,178,283 Total Common and Preferred Stocks (Cost $61,141,925) 48,037,915
---------
SHORT-TERM INVESTMENTS 4.0%
INVESTMENT COMPANIES 3.3%
23,500 Jardine Fleming India Fund 130,719
117,000 Korea Fund, Inc. 972,562
63 Thailand International Fund 593,460
---------
Total Investment Companies (Cost $2,172,851) 1,696,741
---------
Principal
Amount
(in thousands)
- --------------
VARIABLE RATE DEMAND NOTES 0.7%
$364,013 Chase U.S. 364,013
----------
Total Variable Rate Demand Notes (Cost $364,013) 364,013
----------
Total Short-Term Investments (Cost $2,536,864) 2,060,754
----------
Total Investments (Cost $63,678,789) 97.9% 50,098,669
----------
Other Assets, Less Liabilities 2.1% 1,057,693
----------
TOTAL NET ASSETS 100% $51,156,362
===========
<F1> Non-Income producing
<F2> Due to restrictions imposed by the Malaysian government, these securities have been deemed illiquid.
See notes to the financial statements.
<PAGE>
(LOGO) FIRSTARFUNDS
BALANCED GROWTH FUND
GROWTH AND INCOME FUND
EQUITY INDEX FUND
GROWTH FUND
SPECIAL GROWTH FUND
EMERGING GROWTH FUND
MICROCAP FUND
INTERNATIONAL EQUITY FUND
NOTES TO THE FINANCIAL STATEMENTS
(UNAUDITED)
1. ORGANIZATION
Firstar Funds, Inc. (the "Company") was incorporated on February 15, 1988, as
a Wisconsin Corporation and is registered as an open-end management investment
company under the Investment Company Act of 1940. The Balanced Growth Fund
(formerly the Balanced Fund), the Growth and Income Fund, the Equity Index Fund,
the Growth Fund (formerly the MidCore Growth Fund), the Special Growth Fund, the
Emerging Growth Fund, the MicroCap Fund and the International Equity Fund (the
"Funds") are separate, diversified investment portfolios of the Company. The
Special Growth Fund commenced operations on December 28, 1989; the Growth and
Income Fund and Equity Index Fund commenced operations on December 29, 1989; the
Balanced Growth Fund commenced operations on March 30, 1992; the Growth Fund
commenced operations on December 29, 1992; the International Equity Fund
commenced operations on April 28, 1994; the MicroCap Fund commenced operations
on August 1, 1995; and the Emerging Growth Fund commenced operations on August
15, 1997. The objective of the Balanced Growth Fund is to achieve a balance of
capital appreciation and current income with relatively low volatility of
capital. The objective of the Growth and Income Fund is to seek both reasonable
income and long-term capital appreciation. The objective of the Equity Index
Fund is to seek returns, before Fund expenses, comparable to the price and yield
performance of publicly traded common stocks in the aggregate, as represented by
the S&P 500 Stock Index. The objective of the Growth Fund is capital
appreciation through investment in securities of medium- to large-sized
companies. The objective of the Special Growth Fund is capital appreciation
through investment in securities of small- to medium-sized companies. The
objective of the Emerging Growth Fund is capital appreciation through
investments in securities of small-sized companies. The objective of the
MicroCap Fund is capital appreciation through investments in small companies.
The objective of the International Equity Fund is to seek capital appreciation
through investment in foreign securities which the Sub-Advisor believes are
undervalued.
The costs, in thousands, incurred in connection with the organization, initial
registration and public offering of shares aggregating $21, $24 and $27 for the
Emerging Growth, MicroCap and International Equity Funds, respectively, have
been paid by the Funds. These costs are being amortized over the period of
benefit, but not to exceed sixty months from each Fund's commencement of
operations.
The Company has issued two classes of Fund shares in each of the Funds:Series
A and Series Institutional. The Series A shares are subject to a 0.25% service
organization fee and an initial sales charge imposed at the time of purchase, in
accordance with the Funds' prospectus. The maximum sales charge is 4% of the
offering price or 4.16% of the net asset value. Effective January 1, 1999, the
maximum sales charge will be 4.50% of the offering price or 4.71% of the net
asset value. Each class of shares for each Fund has identical rights and
privileges except with respect to service organization fees paid by Series A
shares, voting rights on matters affecting a single class of shares and the
exchange privileges of each class of shares.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. These
policies are in conformity with generally accepted accounting principles.
a) Investment Valuation - Securities which are traded on a recognized stock
exchange are valued at the last sale price on the securities exchange on which
such securities are primarily traded or at the last sale price on a national
securities exchange. Exchange-traded securities for which there were no
transactions are valued at the current bid prices, with the exception of the
International Equity Fund, which is valued at the average of the current bid and
asked prices. Securities traded on only over-the-counter markets are valued on
the basis of closing over-the-counter bid prices. Instruments with a remaining
maturity of 60 days or less are valued on an amortized cost basis. Securities
for which market quotations are not readily available and other assets are
valued at fair value as determined by the investment adviser under the
supervision of the Board of Directors. Portfolio securities which are primarily
traded on foreign securities exchanges are generally valued at the preceding
closing values of such securities on their respective exchanges, except when an
occurrence subsequent to the time a value was so established is likely to have
changed such value. In such an event, the fair value of those securities is
determined through the consideration of other factors by or under the direction
of the Board of Directors. Quotations of foreign securities in foreign currency
are converted to United States ("U.S.") dollar equivalents using the foreign
exchange quotation in effect at the time net asset value is computed. Foreign
securities held by the International Equity Fund may trade in their local
markets on days the U.S. exchanges are closed, and the International Equity
Fund's net asset value may, therefore, change on days when investors may not
purchase or redeem Fund shares.
b) Federal Income Taxes - It is each Fund's policy to meet the requirements of
the Internal Revenue Code applicable to regulated investment companies and each
Fund intends to distribute substantially
<PAGE>
(LOGO)FIRSTARFUNDS
all investment company net taxable income and net capital gains to shareholders.
Therefore, no federal income tax provision is required.
c) Income and Expenses - The Funds are charged for those expenses that are
directly attributable to each portfolio, such as advisory, administration and
certain shareowner service fees. Expenses that are not directly attributable to
a portfolio are typically allocated among the Company's portfolios in proportion
to their respective net assets, number of shareowner accounts, or net sales,
where applicable. Net investment income other than class specific expenses, and
realized and unrealized gains and losses are allocated daily to each class of
shares based upon the relative net asset value of outstanding shares of each
class of shares at the beginning of the day (after adjusting for the current
day's capital share activity of the respective class).
d) Distributions to Shareowners - Dividends from net investment income, if any,
are declared and paid quarterly for the Balanced Growth, Growth and Income and
Equity Index Funds and annually for the Growth, Special Growth, Emerging Growth,
MicroCap and International Equity Funds. Distributions of net realized capital
gains, if any, will be declared at least annually.
e) Futures Contracts - The Equity Index Fund may utilize futures contracts to a
limited extent. The risk associated with the use of futures contracts includes
the possibility of an illiquid market. Futures contracts are valued based upon
their quoted daily settlement prices. Changes in initial settlement value are
accounted for as unrealized appreciation (depreciation) until the contracts are
terminated at which time realized gains and losses are recognized.
f) When-Issued Securities - The Funds may purchase securities on a when-issued
or delayed delivery basis. Although the payment and interest terms of these
securities are established at the time the purchaser enters into the agreement,
these securities may be delivered and paid for at a future date, generally
within 45 days. The Fund records purchases of when-issued securities and
reflects the values of such securities in determining net asset value in the
same manner as other portfolio securities. The Fund identifies and maintains at
all times cash, cash equivalents, or other liquid securities in an amount at
least equal to the amount of outstanding commitments for when-issued securities.
g) Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
h) Foreign Currency Translations - The books and records of the International
Equity Fund are maintained in U.S. dollars. Foreign currencies, investments, and
other assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the exchange rates prevailing at the end of the period, and
purchases and sales of investment securities, and income and expenses
denominated in foreign currencies are translated on the respective dates of such
transactions. Unrealized gains and losses on investments which result from
changes in foreign currency exchange rates have been included in the unrealized
net appreciation (depreciation) on investments. Foreign currency exchange gains
and losses included in net appreciation (depreciation) on foreign currency and
net realized gains and losses on foreign currency include foreign currency gains
and losses between trade date and settlement date on investment securities
transactions, foreign currency transactions and the difference between the
amounts of interest and dividends recorded on the books of the Fund and the
amount actually received; such amounts are considered net investment income
(loss) for tax purposes. The portion of the foreign currency gains and losses
related to fluctuation in exchange rates between the initial purchase trade date
and subsequent sale trade date of a security is included in realized gains and
losses on investment transactions.
i) Other - Investment and shareowner transactions are recorded on the trade
date. The Funds determine the gain or loss realized from the investment
transactions by comparing the original cost of the security lot sold with the
net sale proceeds. Dividend income is recognized on the ex-dividend date or as
soon as information is available to the Funds, and interest income is recognized
on an accrual basis. Generally accepted accounting principles require that
permanent financial reporting and tax differences be reclassified in the capital
accounts.
<PAGE>
(LOGO)FIRSTARFUNDS
3. CAPITAL SHARE TRANSACTIONS
Transactions, in thousands, of shares of the Funds were as follows:
</TABLE>
<TABLE>
<CAPTION>
BALANCED GROWTH GROWTH AND INCOME EQUITY INDEX
FUND FUND FUND
--------------------- -------------------- ---------------------
Amount Shares Amount Shares Amount Shares
------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C>
YEAR ENDED OCTOBER 31, 1998:
Series A shares:
Shares sold $19,603 660 $ 59,834 1,359 $30,526 428
Shares issued to owners in
reinvestment of dividends 4,639 163 5,908 146 2,500 37
Shares redeemed (7,945) (266) (21,073) (483) (14,683) (206)
---------- ---------- ---------- ---------- ---------- ----------
Net increase $ 16,297 557 $ 44,669 1,022 $ 18,343 259
========== ========== ========== ========== ========== ==========
Series Institutional shares:
Shares sold $ 63,126 2,111 $156,883 3,600 $ 154,182 2,167
Shares issued to owners in
revinvestment of dividends 17,086 600 15,009 369 10,229 150
Shares redeemed (52,956) (1,798) (114,144) (2,614) (88,691) (1,252)
---------- ---------- ---------- ---------- ---------- ----------
Net increase $ 27,256 913 $ 57,748 1,355 $ 75,720 1,065
========== ========== ========== ========== ========== ==========
YEAR ENDED OCTOBER 31, 1997:
Series A shares:
Shares sold $15,346 529 $43,063 1,218 $30,916 529
Shares issued to owners in
reinvestment of dividends 2,448 89 6,930 218 1,307 23
Shares redeemed (6,070) (211) (11,682) (328) (8,112) (137)
---------- ---------- ---------- ---------- ---------- ----------
Net increase $11,724 407 $38,311 1,108 $24,111 415
========== ========== ========== ========== ========== ==========
Series Institutional shares:
Shares sold $67,590 2,347 $139,658 3,995 $133,310 2,298
Shares issued to owners in
revinvestment of dividends 10,877 394 20,195 632 6,369 115
Shares redeemed (57,431) (1,976) (78,849) (2,165) (95,857) (1,703)
---------- ---------- ---------- ---------- ---------- ----------
Net increase $21,036 765 $81,004 2,462 $43,822 710
========== ========== ========== ========== ========== ==========
</TABLE>
3. CAPITAL SHARE TRANSACTIONS (CONT.)
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
GROWTH SPECIAL GROWTH EMERGING GROWTH
FUND FUND FUND
--------------------- -------------------- ---------------------
Amount Shares Amount Shares Amount Shares
------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C>
YEAR ENDED OCTOBER 31, 1998:
Series A shares:
Shares sold $ 12,906 367 $ 34,361 820 $ 10,119 969
Shares issued to owners in
reinvestment of dividends 3,577 118 14,452 357 45 5
Shares redeemed (4,328) (135) (36,981) (878) (1,504) (145)
---------- ---------- ---------- ---------- ---------- ----------
Net increase $ 12,155 350 $11,832 299 $ 8,660 829
========== ========== ========== ========== ========== ==========
Series Institutional shares:
Shares sold $ 55,749 1,622 $ 115,060 2,750 $ 30,325 2,998
Shares issued to owners in
revinvestment of dividends 20,361 665 50,064 1,228 307 32
Shares redeemed (66,140) (1,919) (188,422) (4,477) (13,394) (1,384)
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) $ 9,970 368 $ (23,298) (499) $ 17,238 1,646
========== ========== ========== ========== ========== ==========
YEAR ENDED OCTOBER 31, 1997<F1>:
Series A shares:
Shares sold $ 8,130 250 $ 39,485 949 $ 5,403 525
Shares issued to owners in
reinvestment of dividends 727 24 13,955 370 - -
Shares redeemed (3,796) (113) (28,518) (683) (60) (6)
---------- ---------- ---------- ---------- ---------- ----------
Net increase $ 5,061 161 $ 24,922 636 $ 5,343 519
========== ========== ========== ========== ========== ==========
Series Institutional shares:
Shares sold $48,607 1,489 $164,735 3,973 $46,878 4,670
Shares issued to owners in
revinvestment of dividends 5,140 168 53,786 1,420 - -
Shares redeemed (53,475) (1,641) (181,632) (4,277) (118) (11)
---------- ---------- ---------- ---------- ---------- ----------
Net increase $ 272 16 $ 36,889 1,116 $46,760 4,659
========== ========== ========== ========== ========== ==========
</TABLE>
<F1> Capital share activity is for the fiscal year ended October 31,1997 for the
Growth Fund and Special Growth Fund, and for the period August 15, 1997 to
October 31, 1997 for the Emerging Growth Fund.
<PAGE>
(LOGO) FIRSTARFUNDS
3. CAPITAL SHARE TRANSACTIONS (CONT.)
Transactions, in thousands, of shares of the Funds were as follows:
<TABLE>
<CAPTION>
MICROCAP INTERNATIONAL
FUND EQUITY FUND
-------------------- --------------------
Amount Shares Amount Shares
---------- ---------- ---------- ----------
<C> <C> <C> <C>
YEAR ENDED OCTOBER 31, 1998:
Series A shares:
Shares sold $ 1,418 80 $ 3,333 190
Shares issued to owners in
reinvestment of dividends 1,570 99 162 9
Shares redeemed (2,049) (137) (2,075) (122)
---------- ---------- ---------- ----------
Net increase $ 939 42 $ 1,420 77
========== ========== ========== ==========
Series Institutional shares:
Shares sold $ 1,819 125 $ 13,322 748
Shares issued to owners in
revinvestment of dividends 7,878 492 1,085 63
Shares redeemed (10,986) (706) (15,171) (952)
---------- ---------- ---------- ----------
Net increase (decrease) $(1,289) (89) $(764) (141)
========== ========== ========== ==========
YEAR ENDED OCTOBER 31, 1997:
Series A shares:
Shares sold $ 6,446 421 $ 4,828 226
Shares issued to owners in
reinvestment of dividends 1,536 112 116 6
Shares redeemed (2,209) (146) (1,624) (79)
---------- ---------- ---------- ----------
Net increase $ 5,773 387 $ 3,320 153
========== ========== ========== ==========
Series Institutional shares:
Shares sold $22,484 1,468 $27,533 1,361
Shares issued to owners in
revinvestment of dividends 9,877 717 1,149 59
Shares redeemed (5,872) (371) (9,612) (476)
---------- ---------- ---------- ----------
Net increase $26,489 1,814 $19,070 944
========== ========== ========== ==========
</TABLE>
<PAGE>
(LOGO) FIRSTARFUNDS
4. INVESTMENT TRANSACTIONS
The aggregate purchases and sales, in thousands, of securities, excluding
short-term investments, for the Funds for the year ended October 31, 1998, were
as follows:
<TABLE>
<CAPTION>
BALANCED GROWTH AND EQUITY GROWTH SPECIAL EMERGING MICROCAP INTERNATIONAL
GROWTH FUND INCOME FUND INDEX FUND FUND GROWTH FUND GROWTH FUND FUND EQUITY FUND
------------ ------------ ------------ ------------ ------------ ------------------------ ------------
<C> <C> <C> <C> <C> <C> <C> <C>
Purchases:
U.S. Government $28,432 - - - - - - -
Other 116,662 $273,613 $103,862 $103,315 $510,020 $97,415 $147,757 $29,735
Sales:
U.S. Government $14,993 - - - - - - -
Other 106,154 $265,945 $13,630 $123,623 $631,747 $78,582 $167,831 $26,472
</TABLE>
Equity Index Fund transactions in futures contracts during the period October
31, 1997 to October 31, 1998, in thousands, were as follows:
AGGREGATE
NUMBER OF FACE VALUE OF
CONTRACTS CONTRACTS <F1>
---------- ---------------
Outstanding at October 31, 1997 109 $ 25,454
Contracts opened 938 246,543
Contracts closed (947) (246,152)
------- ----------
Outstanding at October 31, 1998 100 $ 25,845
======= ==========
<F1> The aggregate face value of contracts is computed on the date each contract
is opened.
The number of futures contracts and net unrealized appreciation, in thousands,
as of October 31, 1998, were as follows:
NUMBER OF UNREALIZED
CONTRACTS APPRECIATION
---------- --------------
S&P 500 Financial Futures Contract
Expiration date 12/98 <F2> 100 $1,785
<F2> At October 31, 1998, U.S. Treasury Bills of $1,980, in thousands, were held
as collateral by the custodian in an initial margin account in connection with
open futures contracts held by the Equity Index Fund.
At October 31, 1998, gross unrealized appreciation and depreciation of
investments for federal tax purposes, in thousands, were as follows:
<TABLE>
<CAPTION>
BALANCED GROWTH AND EQUITY GROWTH SPECIAL EMERGING MICROCAP INTERNATIONAL
GROWTH FUND INCOME FUND INDEX FUND FUND GROWTH FUND GROWTH FUND FUND EQUITY FUND
------------ ------------ ------------ ------------ ------------ ------------------------ ------------
<C> <C> <C> <C> <C> <C> <C> <C>
Appreciation $47,386 $194,914 $246,519 $72,602 $167,490 $7,113 $14,467 $5,185
(Depreciation) (7,627) (5,395) (14,700) (5,383) (30,433) (6,249) (10,236) (19,014)
--------- ---------- ---------- ---------- ---------- ---------- ----------- -----------
Net unrealized appreciation
(depreciation) on
investments $39,759 $189,519 $231,819 $67,219 $137,057 $864 $4,231 $ (13,829)
========= ========== ========= ========== ========== ========== ========== ==========
</TABLE>
At October 31, 1998, the cost of investments, in thousands, for federal income
tax purposes was $210,082, $468,230, $331,843, $167,957, $468,251, $68,007,
$81,443, and $63,928 for the Balanced Growth, Growth and Income, Equity Index,
Growth, Special Growth, Emerging Growth, MicroCap and International Equity
Funds, respectively.
At October 31, 1998, the Emerging Growth and International Equity Funds had
accumulated net realized capital loss carryovers, in thousands, of $5,736 and
$4,919, respectively, expiring in 2006.
For the year ended October 31, 1998, the following percent of ordinary income
dividends (unaudited) qualifies for the dividend recieved deduction available to
corporate stockholders: Balanced Growth Fund 10%, Growth and Income Fund 85%,
Equity Index Fund 84%, Growth Fund 38% and Emerging Growth Fund 4%.
<PAGE>
(LOGO) FIRSTARFUNDS
5. INVESTMENT ADVISORY AND OTHER AGREEMENTS
The Funds have entered into an Investment Advisory Agreement with Firstar
Investment Research & Management Company ("FIRMCO"). FIRMCO is a subsidiary of
Firstar Corporation, a publicly held bank holding company. Pursuant to its
Advisory Agreement with the Funds, the Adviser is entitled to receive a fee,
calculated daily and payable monthly, at the annual rates presented below as
applied to each Fund's daily net assets. Effective September 2, 1997
FIRMCO entered into a Sub-Advisory Agreement with Hansberger Global Investors
(the "Sub-Adviser") for the International Equity Fund. Prior to September 2,
1997, FIRMCO had entered into a sub-advisory agreement with State Street Global
Advisors for the International Equity Fund. Pursuant to its Sub-Advisory
Agreement with FIRMCO, the Sub-Adviser is entitled to receive a fee from FIRMCO,
calculated daily and payable monthly, at the annual rate presented below as
applied to the International Equity Fund's daily net assets.
For the period ended October 31, 1998, FIRMCO voluntarily waived the following
fees, in thousands, by Fund:
<TABLE>
<CAPTION>
BALANCED GROWTH AND EQUITY GROWTH SPECIAL EMERGING MICROCAP INTERNATIONAL
GROWTH FUND INCOME FUND INDEX FUND FUND GROWTH FUND GROWTH FUND FUND EQUITY FUND
------------ ------------ ------------ ------------ ------------ ------------------------ ------------
<C> <C> <C> <C> <C> <C> <C> <C>
Annual Rate 0.75% 0.75% 0.25% 0.75% 0.75% 0.75% 1.50% <F1> <F2>
Fees waived $403 - $180 - - $135 $3 $219
</TABLE>
<F1> FIRMCO is entitled to receive a fee, calculated daily and payable monthly,
at the annual rate of 1.50% of the Fund's first $25 million of average daily net
assets, 1.25% on the next $75 million and 1.10% of the Fund's average daily net
assets in excess of $100 million.
<F2> Pursuant to its Sub-Advisory Agreement with FIRMCO, the Sub-Adviser is
entitled to receive a fee from FIRMCO, calculated daily and payable monthly, at
the annual rate of 0.75% of the Fund's first $25 million of average daily net
assets, 0.50% on the next $75 million and 0.35% of the Fund's average daily net
assets in excess of $100 million.
Chase Manhattan Bank serves as sub-custodian for the International Equity
Fund. Firstar Bank Milwaukee, N.A. serves as custodian and Firstar Mutual Fund
Services, LLC serves as transfer agent and accounting services agent for all the
Funds. Both companies are affiliates of FIRMCO.
The Company has entered into a Co-Administration Agreement with B.C. Ziegler
and Company and Firstar Mutual Fund Services, LLC (the "Co-Administrators") for
certain administrative services. Pursuant to the Co-Administration Agreement
with the Company, the Co-Administrators are entitled to receive a fee, computed
daily and payable monthly, at the annual rate of 0.125% of the Company's first
$2 billion of average aggregate daily net assets, plus 0.10% of the Company's
average aggregate daily net assets in excess of $2 billion. For the year ended
October 31, 1998, $164, $424, $353, $156, $493, $47, $79, and $45 of
administration fees, in thousands, were voluntarily waived for the Balanced
Growth, Growth and Income, Equity Index, Growth, Special Growth, Emerging
Growth, MicroCap and International Equity Funds, respectively.
The Company has entered into Servicing Agreements with certain Service
Organizations, including FIRMCOaffiliates, for the Series A class of shares. The
Service Organizations are entitled to receive fees from the Funds up to the
annual rate of 0.25% of the average daily net asset value of the Series A Shares
for certain support and/or distribution services to customers of the Service
Organizations who are beneficial owners of Series A Shares. These services may
include assisting customers in processing purchase, exchange and redemption
requests; processing dividend and distribution payments from the Funds; and
providing information periodically to customers showing their positions in
Series A Shares. Service Organization fees, in thousands, incurred by the
Balanced Growth, Growth and Income, Equity Index, Growth, Special Growth,
Emerging Growth, MicroCap and International Equity Funds aggregated $136, $415,
$244, $81, $383, $24, $40, and $17 respectively, for the year ended
October 31, 1998.
Each Director of the Company who is not affiliated with FIRMCO receives an
annual fee from the Company for service as a Director and is eligible to
participate in a deferred compensation plan with respect to these fees.
Participants in the plan may designate their deferred Director's fees as if
invested in any one of the Firstar Funds (with the exception of the MicroCap
Fund) or in 90-day U.S. Treasury bills. The value of each Director's deferred
compensation account will increase or decrease as if it were invested in shares
of the selected Firstar Funds or 90-day U.S. Treasury bills. The Funds maintain
their proportionate share of the Company's liability for deferred fees.
6. FOREIGN SECURITIES
Investing in securities of foreign companies and foreign governments involves
special risks and considerations not typically associated with investing in
U.S.companies and the U.S. government. These risks include revaluation of
currencies and future adverse political and economic developments. Moreover,
securities of many foreign companies and foreign governments and their markets
may be less liquid and their prices more volatile than those of securities of
comparable U.S. companies and the U.S.Government.
<PAGE>
(LOGO) FIRSTARFUNDS
7. DISTRIBUTIONS (UNAUDITED)
During the period ended October 31, 1998, the following Funds paid capital gain
distributions (taxable as long-term capital gains) to both Series A and Series
Institutional shareowners:
<TABLE>
<CAPTION>
BALANCED GROWTH EQUITY SPECIAL INTERNATIONAL
GROWTH AND INCOME INDEX GROWTH GROWTH MICROCAP EQUITY
FUND FUND FUND FUND FUND FUND FUND
------------ ------------ ------------ ------------ ------------ ------------------------
<C> <C> <C> <C> <C> <C> <C>
Per Share $2.27 $1.23 $0.85 $4.73 $4.46 $0.09 $0.32
Percentage of capital
gains
distribution taxed at
a maximum rate of 20% 56.4% 49.1% 100% 57.5% 51.4% 0% 4.8%
</TABLE>
8. TRANSACTIONS WITH AFFILIATES
The following company is affiliated with the MicroCap Fund, that is, the Fund
held 5% or more of the outstanding voting securities during the fiscal year
ended October 31, 1998. Such companies are defined in Section (2)(a)(3) of the
Investment Company act of 1940.
<TABLE>
<CAPTION>
SHARE BALANCE AT SHARE BALANCE AT
COMPANY OCTOBER 31, 1997 PURCHASES SALES OCTOBER 31, 1998 DIVIDENDS GAIN/LOSSES
- --------- ----------------- ----------- ------ ------------------ ----------- ------------
<C> <C> <C> <C> <C> <C>
EduTrek International, Inc. 0 274,500 0 274,500 $0 $0
</TABLE>
<PAGE>
(LOGO) FIRSTARFUNDS
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF THE FIRSTAR BALANCED GROWTH FUND,
THE FIRSTAR GROWTH AND INCOME FUND, THE FIRSTAR EQUITY INDEX FUND, THE FIRSTAR
GROWTH FUND, THE FIRSTAR SPECIAL GROWTH FUND, THE FIRSTAR EMERGING GROWTH FUND,
THE FIRSTAR MICROCAP FUND AND THE FIRSTAR INTERNATIONAL EQUITY FUND
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Firstar Balanced Growth Fund,
the Firstar Growth and Income Fund, the Firstar Equity Index Fund, the Firstar
Growth Fund, the Firstar Special Growth Fund, the Firstar Emerging Growth Fund,
the Firstar MicroCap Fund and the Firstar International Equity Fund (eight of
the portfolios of Firstar Funds, Inc. (the "Funds")) at October 31, 1998, the
results of each of their operations for the year then ended, the changes in each
of their net assets for each of the two years in the period then ended and each
of their financial highlights for the year ended October 31, 1998, and for each
of the other periods indicated, all in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Funds' management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at October 31, 1998 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Milwaukee, Wisconsin
December 8, 1998
<PAGE>
(LOGO) FIRSTARFUNDS
This page intentionally left blank.
<PAGE>
(LOGO) FIRSTARFUNDS
This page intentionally left blank.
<PAGE>
FIRSTAR FUNDS ARE AVAILABLE THROUGH:
- - THE FIRSTAR FUNDS CENTER,
- - INVESTMENT SPECIALISTS WHO ARE REGISTERED
REPRESENTATIVES OF FIRSTAR INVESTMENT SERVICES, INC.
A REGISTERED BROKER/DEALER, NASD AND SIPC MEMBER,
- - AND THROUGH SELECTED SHAREHOLDER ORGANIZATIONS.
This report is authorized for distribution only when preceded or
accompanied by a current prospectus.
FOR ACCOUNT BALANCES AND INVESTOR SERVICES INFORMATION
1-800-228-1024
1-414-287-3808
FIRSTAR FUNDS CENTER
615 EAST MICHIGAN STREET
P.O. BOX 3011
MILWAUKEE, WI 53201-3011
WWW.FIRSTARFUNDS.COM
(LOGO) FIRSTARFUNDS
FORM #40-0249 12/98
