<PAGE>
- --------------------------------------------------------------------------------
WEITZ SERIES FUND, INC.
BOARD OF DIRECTORS
Carroll E. Fredrickson
John W. Hancock
Richard D. Holland
Thomas R. Pansing, Jr.
Wallace R. Weitz
OFFICERS
Wallace R. Weitz, President
Mary K. Beerling, Vice-President & Secretary
Linda L. Lawson, Vice-President
Richard F. Lawson, Vice-President
INVESTMENT ADVISER
Wallace R. Weitz & Company
DISTRIBUTOR
Weitz Securities, Inc.
CUSTODIAN
Norwest Bank Nebraska, N.A.
TRANSFER AGENT AND DIVIDEND PAYING AGENT
Wallace R. Weitz & Company
This report has been prepared for the information of shareholders of Weitz
Series Fund, Inc. -- Hickory Portfolio and is not authorized for distribution to
prospective investors unless preceded or accompanied by a current prospectus
which describes the Fund's objectives, policies and other information.
HICKORY PORTFOLIO
A N N U A L
R E P O R T
MARCH 31, 1996
ONE PACIFIC PLACE, SUITE 600
1125 SOUTH 103 STREET
OMAHA, NEBRASKA 68124-6008
402-391-1980
800-232-4161
402-391-2125 FAX
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
PERFORMANCE SINCE INCEPTION
The following table summarizes our results for the three month period ended
March 31, 1996, the one year periods ended December 31, 1995, 1994, 1993, and
the three-month period since inception. The table also sets forth average annual
total return data for the fund for the one year period ended March 31, 1996, and
for the period since inception, calculated in accordance with SEC standardized
formulas.
<TABLE>
<CAPTION>
DIFFERENCE
PERIOD ENDED HICKORY FUND S&P 500 HICKORY FUND -- S&P 500
- ------------------------ ------------- ----------- -------------------------
<S> <C> <C> <C>
March 31, 1996 (3 Mos.) 6.2% 5.4% 0.8%
Dec. 31, 1995 40.5 37.5 3.0
Dec. 31, 1994 -17.3 1.3 -18.6
Dec. 31, 1993 34.1 10.1 24.0
Since Inception (Jan. 1,
1993)
Cumulative 65.3 61.6 3.7
Compound Annual Average
Return 16.7 15.9 0.8
</TABLE>
The Portfolio's average annual total return for one year period ending March 31,
1996 and for the period since inception (January 1, 1993), was 40.6% and 16.7%,
respectively. The return assumes redemption at the end of each period.
2
<PAGE>
The graph below shows the growth in value of an initial $100,000 investment in
Hickory, assuming the reinvestment of all capital gain distributions and
dividends, compared to the growth in value of $100,000 invested in the S&P 500,
also assuming dividend reinvestment. Hickory's performance numbers are
calculated after deducting all fees and expenses.
<TABLE>
<CAPTION>
HICKORY QUARTERLY REPORT GRAPH
- -------------------------------------------------------------
HICKORY
- ---------------
S&P 500
---------
VALUE CUMULATIVE VALUE
ENDING $25,000 RETURN $25,000
--------- --------- ----------- ---------
<S> <C> <C> <C> <C>
Ince 12/31/92 $ 100,000 0.00000 $ 100,000
01/31/93 $ 109,800 0.00835 $ 100,835
02/28/93 $ 113,000 0.02208 $ 102,208
3/93 03/31/93 $ 111,470 0.04363 $ 104,363
04/30/93 $ 102,130 0.01840 $ 101,840
05/31/93 $ 107,010 0.04555 $ 104,555
6/93 06/30/93 $ 107,690 0.04860 $ 104,860
07/31/93 $ 110,900 0.04437 $ 104,437
08/31/93 $ 119,500 0.08390 $ 108,390
9/93 09/30/93 $ 120,390 0.07558 $ 107,558
10/31/93 $ 128,220 0.09782 $ 109,782
11/30/93 $ 124,220 0.08739 $ 108,739
12/9 12/31/93 $ 134,062 0.10053 $ 110,053
01/31/94 $ 132,004 0.13791 $ 113,791
02/28/94 $ 129,836 0.10704 $ 110,704
3/94 03/31/94 $ 122,739 0.05884 $ 105,884
04/30/94 $ 121,569 0.07243 $ 107,243
05/31/94 $ 122,690 0.08996 $ 108,996
6/94 06/30/94 $ 116,808 0.06326 $ 106,326
07/31/94 $ 116,099 0.09815 $ 109,815
08/31/94 $ 123,019 0.14308 $ 114,308
9/94 09/30/94 $ 121,713 0.11517 $ 111,517
10/31/94 $ 120,150 0.14013 $ 114,013
11/30/94 $ 113,488 0.09865 $ 109,865
12/9 12/31/94 $ 110,886 0.11491 $ 111,491
01/31/95 $ 111,325 0.14380 $ 114,380
02/28/95 $ 115,922 0.18832 $ 118,832
3/95 03/31/95 $ 117,615 0.22333 $ 122,333
04/30/95 $ 117,299 0.25933 $ 125,933
05/31/95 $ 123,792 0.30954 $ 130,954
6/95 06/30/95 $ 131,904 0.33993 $ 133,993
07/31/95 $ 139,180 0.38434 $ 138,434
08/31/95 $ 148,752 0.38779 $ 138,779
9/95 09/30/95 $ 155,065 0.44633 $ 144,633
10/31/95 $ 148,519 0.44116 $ 144,116
11/30/95 $ 153,098 0.50435 $ 150,435
12/9 12/31/95 $ 155,754 0.53332 $ 153,332
01/31/96 $ 163,839 0.58545 $ 158,545
02/29/96 $ 165,921 0.60018 $ 160,018
3/96 03/31/96 $ 165,348 0.61558 $ 161,558
</TABLE>
This information represents past performance of the Portfolio and is not
indicative of future performance. The investment return and principal value of
an investment will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than the original cost. The index used for comparison
purposes is the S&P 500 Index which consists of 500 companies. The index is
unmanaged and widely recognized as representative of the equity market in
general. Information relating to the S&P 500 assumes reinvestment of dividends.
Additional information is available from Wallace R. Weitz & Co. at the address
listed on the front cover.
3
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
MARCH 31, 1996 - ANNUAL REPORT
April 10, 1996
Dear Fellow Shareholders:
The stock market continued to smile on Hickory during the first three
months of 1996. Our shares gained 6.2% during the quarter. Over the same period
the S&P 500 had a total return (including reinvested dividends) of 5.4%. Over
the last twelve months, Hickory's total return was 40.6% while the S&P 500's
total return was 32.1%.
REVIEW AND OUTLOOK
In the last two Hickory reports I have told you that I like the stocks we
own but that I am a little nervous about the stock market as a whole. Nothing
has changed over the last three months that has caused me to alter this view. I
continue to be quite comfortable with Hickory's holdings even though I still
believe that many sectors of the stock market look dangerous. In this letter I
want to share with you my enthusiasm for one particular group of Hickory's
holdings--the cellular service providers.
I believe the cellular story has all the elements to create a rewarding
investment situation. First, cellular has excellent business fundamentals.
Second, the financial characteristics of the cellular companies are very
appealing. Finally, Wall Street seems to be worrying about the wrong problems.
In my opinion, providing cellular services is a classic "good business."
Demand is rising rapidly, revenues are stable and recurring, and barriers to
entry are high. Analysts estimate that in 1995, 3.5% of the U.S. population
started using a cellular phone, bringing total penetration to over 12.5%. It
seems clear to me, as it does to most observers, that the total number of
cellular subscribers can continue to grow for many years. And once customers
subscribe to cellular service there is a strong tendency to continue to use the
service, regardless of the current state of the economy.
Most importantly, barriers to entry into the business, though declining,
remain very high. An obvious barrier is the need for a cellular license. The
federal government is in the process of auctioning new licenses for a
cellular-like service called PCS. In the largest cities, I expect there will
eventually be as many as five or six competitors, up from two today. But first
these new competitors will have to pay for the licenses and construct their
networks. This will take both time and money. In many cases the new entrants
won't be ready to sell their services until the end of 1997 or later. By this
time total cellular penetration in the country could be as high as 20%. Even
then, the new entrants will face challenges. They will need to establish
distribution channels and spend more money to entice customers to buy their
services. None of these barriers are totally insurmountable. I firmly believe
that some new entrants will succeed. After all, demand should still be growing
rapidly and an aggressive PCS company should be able to attract a SHARE of new
subscribers. The bottom line for cellular: slower growth but a good business
nevertheless.
The financial profiles of cellular companies are rapidly changing for the
better. Cellular is a network business and all network businesses share certain
financial characteristics. The company offering the service has to spend a lot
of money up front to build the network and then spend more money to attract
customers to the network. Only after all that spending is completed does the
cash
4
<PAGE>
start flowing back to the company. The important point is that cellular
companies in this country are rapidly reaching the point where they generate
large amounts of free cash beyond the amount needed to reinvest in their
businesses and pay interest on their debt.
Each company has a slightly different situation, but the trend is clear.
Cash flow is rising rapidly, debt is stabilizing or dropping, and companies
should start reporting positive earnings. Most importantly, free cash available
to buy back stock or invest in new projects should be quite large in the years
ahead. To give you an example, one analyst projects that Cellular Communications
of Puerto Rico (CCPR) will generate enough free cash over the next five years
that it could, if it chose, buy back 60 percent of its shares at today's price.
I don't know exactly what the future holds for CCPR, but I am comfortable that
the combination of good management, financial flexibility, and an undervalued
stock can result in attractive investment returns.
Wall Street does not seem to care. Investors seem to be focused on two
issues: PCS competition and the earnings shortfalls reported recently by
manufacturers of cellular phone handsets, such as Motorola. I have already told
you some of the reasons why I feel the threat of PCS is overblown, but I need to
add one more point. All PCS licensees plan to focus first on the largest urban
markets, far from where companies like Centennial Cellular and CommNet Cellular
operate. These rural cellular companies will not be seeing PCS competition for
many years. They will, however, benefit from additional roaming revenues as big
city PCS customers occasionally want to use their phones in the country.
As to the problems of the handset manufacturers, investors seem to be
confusing the very different dynamics of two related, but different businesses.
These numbers should help illustrate my point. Since the cellular providers
receive recurring revenue from subscribers, new customers mean a higher
cumulative total, while for the handset manufacturers one-time sales of phones
mean that the manufacturer starts at zero each January 1. In 1996, analysts
expect about 10 million new cellular subscribers in the U.S., about the same as
in 1995. To Motorola this looks like a market experiencing no growth. But to the
cellular providers this represents 30 percent more customers than the year
before.
What does this all mean? It means I can buy good businesses at prices that
look quite reasonable relative to current results. I don't have to pay for what
I believe are very bright future prospects. The proportion of Hickory invested
in cellular companies is now almost 10%, and I plan to continue to increase our
investment.
ANNUAL MEETING
On Wednesday, May 29, 1996, we will have our annual meeting for
shareholders at the Omaha Marriott. The meeting room will open at 4:00 p.m. for
snacks and drinks, and the business meeting will start at 4:30. This is a great
opportunity to ask questions about your investment and to meet the members of
our staff that you have been talking to on the phone. If you plan to join us for
the meeting, please let Mary Bickels know so we can plan for the right number of
people.
As always, I welcome your questions.
Sincerely,
/s/ RICHARD LAWSON
Richard F. Lawson
Portfolio Manager
5
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
SCHEDULE OF INVESTMENTS IN SECURITIES
MARCH 31, 1996
<TABLE>
<CAPTION>
SHARES
OR UNITS COST MARKET VALUE
- --------- ---------- ------------
<C> <S> <C> <C>
COMMON STOCKS -- 96.6%
BANKING -- 4.0%
1,000 Wells Fargo & Co. $ 88,506 $ 261,000
---------- ------------
CABLE TELEVISION -- 13.6%
33,000 Adelphia Communications CL A* 329,625 231,000
14,000 Comcast Corporation CL A 220,928 247,625
17,000 Tele-Communications, Inc. CL A* 269,753 315,563
4,250 Tele-Communications Liberty Media CL A* 86,356 112,094
---------- ------------
906,662 906,282
---------- ------------
CONSUMER PRODUCTS AND SERVICES -- 5.6%
31,000 American Classic Voyages Co. 349,562 255,750
8,000 Protection One, Inc.* 42,000 118,000
---------- ------------
391,562 373,750
---------- ------------
DEFENSE -- 1.5%
7,500 Esco Electronics Corporation* 60,450 101,250
---------- ------------
FINANCIAL SERVICES -- 14.7%
12,000 Capital One Financial Corp. 272,571 330,000
3,000 First USA, Inc. 131,430 169,875
12,000 Imperial Credit Industries, Inc.* 71,614 294,000
5,000 Salomon, Inc. 228,175 187,500
---------- ------------
703,790 981,375
---------- ------------
HEALTH CARE -- 3.6%
6,500 Seafield Capital Corp. 233,375 240,500
---------- ------------
MEDIA/OTHER -- 7.5%
30,000 Valassis Communications, Inc.* 421,012 498,750
---------- ------------
MORTGAGE BANKING -- 18.9%
35,000 Countrywide Credit, Inc. 547,546 774,375
31,127 Resource Bancshares Mtg. Grp.* 363,500 486,359
---------- ------------
911,046 1,260,734
---------- ------------
</TABLE>
See accompanying notes to financial statements.
6
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
SCHEDULE OF INVESTMENTS IN SECURITIES, CONTINUED
<TABLE>
<CAPTION>
SHARES
OR UNITS COST MARKET VALUE
- --------- ---------- ------------
<C> <S> <C> <C>
REAL ESTATE AND CONSTRUCTION -- 5.8%
9,000 Catellus Development Corp.* $ 57,885 $ 69,750
6,000 Forest City Enterprises CL A 197,678 220,500
5,000 NHP, Inc.* 66,875 92,500
---------- ------------
322,438 382,750
---------- ------------
REAL ESTATE INVESTMENT TRUSTS -- 11.9%
26,005 Redwood Trust, Inc. 408,140 533,102
18,000 Thornburg Mortgage Asset Corp. 272,580 258,750
---------- ------------
680,720 791,852
---------- ------------
TELECOMMUNICATIONS SERVICES -- 9.5%
7,000 Cellular Communications of Puerto Rico, Inc.* 183,550 189,000
20,000 Centennial Cellular Corp. CL A* 312,912 305,000
5,000 CommNet Cellular, Inc.* 133,125 139,375
---------- ------------
629,587 633,375
---------- ------------
Total Common Stocks 5,349,148 6,431,618
---------- ------------
WARRANTS -- 2.2%
23,500 Redwood Trust, Inc.** 92,548 146,875
---------- ------------
<CAPTION>
FACE
AMOUNT
- ---------
<C> <S> <C> <C>
SHORT-TERM SECURITIES -- 1.8%
$120,898 Norwest U.S. Government Money Market Fund, 4.8% 120,898 120,898
---------- ------------
Total Investments in Securities $5,562,594*** 6,699,391
---------- ------------
----------
Other Liabilities in Excess of Other Assets -- (41,177)
(0.6%)
------------
------------
Total Net Assets -- 100.0% $6,658,214
------------
------------
Net Asset Value Per Share $ 15.564
------------
------------
</TABLE>
*Non-income producing
**Each warrant allows for the purchase of 1 share of common stock at $14.99;
expiration date is 12/31/97
***Also approximates cost for federal income tax purposes
See accompanying notes to financial statements.
7
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1996
<TABLE>
<S> <C>
Assets:
Investment in securities at market (cost $5,562,594) $ 6,699,391
Accrued interest and dividends receivable 23,647
------------
Total assets 6,723,038
------------
Liabilities:
Accrued expenses, including amount due adviser (note 3) 7,674
Payable for securities purchased 57,150
------------
Total liabilities 64,824
------------
Net assets applicable to outstanding capital stock $ 6,658,214
------------
------------
Net assets represented by:
Capital stock outstanding, at par (notes 3 & 4) 428
Additional paid-in capital 5,068,912
Accumulated undistributed net investment income 1,255
Accumulated undistributed net realized gains 450,822
Net unrealized appreciation of investments (note 5) 1,136,797
------------
Total representing net assets applicable to shares outstanding $ 6,658,214
------------
------------
Net asset value per share of outstanding capital stock (427,806 shares
outstanding) $ 15.564
------------
------------
</TABLE>
See accompanying notes to financial statements.
8
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
STATEMENT OF OPERATIONS
YEAR ENDED MARCH 31, 1996
<TABLE>
<S> <C>
Investment income:
Dividends $ 67,722
Interest 8,971
-----------
Total investment income 76,693
-----------
Expenses (note 3):
Investment advisory fee 50,292
Administrative fee 12,573
Other expenses 18,225
Less administrative fee waived by investment adviser (5,652)
-----------
Total expenses 75,438
-----------
Net investment income 1,255
-----------
Realized and unrealized gain on investments (note 5):
Realized gain on investments 543,395
Net increase in unrealized appreciation of investments 1,047,935
-----------
Net realized and unrealized gain on investments 1,591,330
-----------
Net increase in net assets resulting from operations $ 1,592,585
-----------
-----------
</TABLE>
See accompanying notes to financial statements.
9
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED MARCH 31, 1996 AND 1995
<TABLE>
<CAPTION>
1996 1995
------------ ------------
<S> <C> <C>
Increase in net assets:
From operations:
Net investment income (loss) $ 1,255 $ (5,224)
Net realized gain (loss) 543,395 (9,035)
Unrealized appreciation (depreciation) 1,047,935 (64,279)
------------ ------------
Net increase (decrease) in net assets resulting from operations 1,592,585 (78,538)
------------ ------------
Distributions to shareholders from:
Net investment income (loss) 44,007 (79,529)
Net realized gain 23,785 189,631
------------ ------------
Total distributions 67,792 110,102
------------ ------------
Capital share transactions (note 4):
Proceeds from sales 1,866,882 1,517,122
Payments for redemptions (419,250) (318,681)
Reinvestment of net investment income and net realized gain at net asset value 66,521 110,102
------------ ------------
Total increase from capital share transactions 1,514,153 1,308,543
------------ ------------
Total increase in net assets 3,038,946 1,119,903
------------ ------------
Net assets:
Beginning of period 3,619,268 2,499,365
------------ ------------
End of period (including undistributed net investment income of $1,255 in 1996 and
$69,347 in 1995) $ 6,658,214 $ 3,619,268
------------ ------------
------------ ------------
</TABLE>
See accompanying notes to financial statements.
10
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
FINANCIAL HIGHLIGHTS
The following information provides selected data for a share of the Hickory
Portfolio outstanding throughout the periods indicated.
<TABLE>
<CAPTION>
YEAR ENDED MARCH 31, JAN. 1, 1993
------------------------------------ (INCEPTION) TO
1996*** 1995 1994 MARCH 31, 1993
---------- ---------- ---------- --------------
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $ 11.257 $ 12.227 $ 11.147 $ 10.000
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment income 0.004 (0.008) (0.290) (0.014)
Net gains or losses on securities
(realized and unrealized) 4.504 (0.508) 1.420 1.161
---------- ---------- ---------- --------------
Total from investment operations 4.508 (0.516) 1.130 1.147
LESS DISTRIBUTIONS:
Dividends (from net investment income) (0.136) -- 0.083 --
Distributions (from capital gains) (0.065) (0.454) (0.133) --
---------- ---------- ---------- --------------
Total distributions (0.201) (0.454) (0.050) --
---------- ---------- ---------- --------------
NET ASSET VALUE, END OF PERIOD $ 15.564 $ 11.257 $ 12.227 $ 11.147
---------- ---------- ---------- --------------
---------- ---------- ---------- --------------
TOTAL RETURN 40.6% (4.2%) 10.1% 11.5%
RATIOS/SUPPLEMENTAL DATA:
Net assets, End of period $6,658,214 $3,619,268 $2,499,365 $1,583,672
Ratio of net expenses to average net
assets 1.50%** 1.50% 1.50% 1.19%*
Ratio of net investment income to
average net assets 0.02% (0.17%) (2.92%) (0.65%)*
Portfolio turnover rate 28% 20% 29% 0%*
</TABLE>
*Annualized for periods of less than twelve months.
**Absent voluntary waivers, the expense ratio would have been 1.61%.
***Calculated using average daily shares.
See accompanying notes to financial statements.
11
<PAGE>
WEITZ SERIES FUND, INC. -- HICKORY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1996
(1) ORGANIZATION
Weitz Series Fund, Inc. (the "Fund") is registered under the Investment
Company Act of 1940 as an open-end management investment company issuing
shares in series, each series representing a distinct portfolio with its own
investment objectives and policies. At March 31, 1996, the Fund had four
series: the Hickory Portfolio, the Value Portfolio, the Fixed Income
Portfolio, and the Government Money Market Portfolio. The accompanying
financial statements present the financial position and results of
operations of the Hickory Portfolio (the "Portfolio").
The Portfolio's investment objective is capital appreciation. The Portfolio
intends to invest principally in common stocks, preferred stocks and a
variety of securities convertible into equity such as rights, warrants,
preferred stocks and convertible bonds. The following significant accounting
policies are in accordance with accounting policies generally accepted in
the investment company industry.
(2) SIGNIFICANT ACCOUNTING POLICIES
(a) VALUATION OF INVESTMENTS
Investments are carried at market determined using the following
valuation methods:
- Securities traded on a national or regional securities exchange are
valued at the last quoted sales price.
- Securities not listed on an exchange or securities in which there
were no reported transactions will be valued at the mean between the
last current closing bid and ask prices.
- Securities or other assets for which reliable recent market
quotations are not readily available will be valued at fair market
value as determined in good faith by or under the direction of the
Fund's Board of Directors or a committee of the Board.
All securities are valued in accordance with the above noted policies at
the close of each business day.
When the Portfolio writes a call option, an amount equal to the premium
received by the Portfolio is included in the Portfolio's statement of
assets and liabilities as a liability. The amount of the liability is
subsequently marked-to-market to reflect the current market value of the
option written. The current market value of a traded option is the last
sales price on the principal exchange on which such option is traded, or,
in the absence of such sale, the latest ask quotation. When an option
expires on its stipulated expiration date or the Portfolio enters into a
closing purchase transaction, the Portfolio realizes a gain (or loss if
the cost of a closing purchase transaction exceeds the premium received
when the option was sold) without regard to any unrealized gain or loss
on the underlying security, and the liability related to such option is
extinguished. When a call option is exercised, the Portfolio realizes a
12
<PAGE>
gain or loss from the sale of the underlying security and the proceeds
from such sale are increased by the premium originally received. Although
no call options were written in the year ended March 31, 1996, such
options are authorized.
(b) FEDERAL INCOME TAXES
Since the Portfolio's policy is to comply with all sections of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to shareholders, no provision for
income or excise taxes is required.
Net investment income and net realized gains may differ for financial
statement and tax purposes. The character of distributions made during
the year from net investment income or net realized gains may differ from
their ultimate characterization for federal income tax purposes. Also,
due to the timing of dividend distributions, the fiscal year in which
amounts are distributed may differ from the year that the income or
realized gains were recorded by the funds.
On the statement of assets and liabilities, as a result of permanent
book-to-tax differences, accumulated undistributed net investment income
has been decreased by $25,340, accumulated undistributed capital gains
has been increased by $27,372, and additional paid-in-capital has been
decreased by $2,032.
(c) SECURITY TRANSACTIONS
Security transactions are accounted for on the date securities are
purchased or sold (trade date). Dividend income and distributions to
shareholders are recorded on the ex-dividend date. Interest, including
amortization of discount and premium, is accrued as earned.
Realized gains or losses are determined by specifically identifying the
issue sold.
(d) DIVIDEND POLICY
The Portfolio will declare and distribute income dividends and capital
gains distributions as may be required to qualify as a regulated
investment company under the Internal Revenue Code. All dividends and
distributions will be reinvested automatically unless the shareholder
elects otherwise.
(e) 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 increase and decrease in
net assets from operations during the period. Actual results could differ
from those estimates.
13
<PAGE>
(3) RELATED PARTY TRANSACTIONS
The Fund and Portfolio have retained Wallace R. Weitz & Company (the
"Adviser") as their exclusive investment adviser. In addition, the Fund has
an agreement with Weitz Securities, Inc. to act as distributor for the
Portfolio's shares. Certain officers and directors of the Fund are also
officers and directors of the Adviser and Weitz Securities, Inc.
Under the terms of the management and investment advisory agreement, the
Adviser receives a management fee equal to 1% per annum of the Portfolio's
average daily net asset value. The Adviser has agreed to reimburse the
Portfolio up to the amount of advisory fees paid to the extent that total
expenses exceed 1.50% of the Portfolio's average daily net asset value. The
expenses incurred by the Portfolio did not exceed the percentage limitation
during the year ended March 31, 1996. At March 31, 1996, the Portfolio had
accrued advisory fees of $5,569 which were classified as accrued expenses.
Under the terms of the administrative services agreement, certain services
are being provided including the transfer of shares, disbursement of
dividends, fund accounting and related administrative services of the Fund
for which the Adviser is being paid a monthly fee. During the year ended
March 31, 1996, the fee was calculated at an average annual rate of .25% of
the Portfolio's average daily net assets, of which .11% was waived.
Weitz Securities, Inc., as distributor, received no compensation for the
distribution of Fund shares.
As of March 31, 1996, directors, officers and employees of the Fund, the
Adviser and Weitz Securities, Inc. and their immediate family members held
162,892 shares of capital stock of the Portfolio representing 38.1% of the
Portfolio.
(4) CAPITAL STOCK
The Fund is authorized to issue a total of 100 million shares of common
stock in series with a par value of $.001 per share. Ten million of these
shares have been authorized by the Board of Directors to be issued in the
series designated Hickory Portfolio shares, of which 427,806 shares are
outstanding at March 31, 1996. The Board of Directors may authorize
additional shares in other series of the Fund's shares without shareholder
approval. Each share of stock will have a pro rata interest in the assets of
the Portfolio to which the stock of that series relates and will have no
interest in the assets of any other portfolio.
14
<PAGE>
Transactions in the capital stock of the Portfolio are summarized as follow:
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
MARCH 31, 1996 MARCH 31, 1995
-------------- --------------
<S> <C> <C>
Transactions in shares:
Shares issued........................................................ 129,659 135,559
Shares redeemed...................................................... 28,893 28,365
Distributions reinvested............................................. 5,526 9,904
------- -------
Net increase....................................................... 106,292 117,098
------- -------
------- -------
</TABLE>
(5) SECURITIES TRANSACTIONS
The aggregate cost and the proceeds from the sales of securities was
$832,107 and $1,375,502 for the year ended March 31, 1996.
At March 31, 1996, unrealized appreciation of securities was comprised of
gross unrealized appreciation of $1,417,813 offset by gross unrealized
depreciation of $281,016.
(6) DIRECTORS' FEES AND EXPENSES
The Fund pays directors (other than directors who are also officers of the
Adviser) a fee of $400 per board meeting attended and $100 per audit
committee meeting attended, which is allocated to the various portfolios.
During the year ended March 31, 1996, the Hickory Portfolio paid directors'
fees of $193.
15
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders
Weitz Series Fund, Inc. -- Hickory Portfolio:
We have audited the accompanying statement of assets and liabilities of Weitz
Series Fund, Inc. -- Hickory Portfolio, including the schedule of investments in
securities, as of March 31, 1996, the related statement of operations for the
year then ended and changes in net assets for each of the years in the two-year
period then ended and financial highlights for each of the years in the
three-year period then ended and for the period from January 1, 1993 (inception)
to March 31, 1993. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of March
31, 1996, by correspondence with custodians and brokers. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Weitz
Series Fund, Inc. - Hickory Portfolio as of March 31, 1996, the results of its
operations for the year then ended and the changes in its net assets for each of
the years in the two-year period then ended and financial highlights for each of
the years in the three-year period then ended and for the period from January 1,
1993 (inception) to March 31, 1993 in conformity with generally accepted
accounting principles.
KPMG PEAT MARWICK LLP
April 17, 1996
Omaha, Nebraska
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