<PAGE>
WEITZ SERIES FUND, INC.
- --------------------------------------------------------------------------------
VALUE FUND
SEMI-ANNUAL
REPORT
SEPTEMBER 30, 1999
ONE PACIFIC PLACE, SUITE 600
1125 SOUTH 103 STREET
OMAHA, NEBRASKA 68124-6008
402-391-1980
800-232-4161
402-391-2125 FAX
www.weitzfunds.com
<PAGE>
(This page has been left blank intentionally.)
2
<PAGE>
WEITZ SERIES FUND, INC.--VALUE FUND
PERFORMANCE SINCE INCEPTION
A long-term perspective on the Value Fund's performance is shown below. The
table below shows how an investment of $25,000 in the Value Fund at its
inception would have grown over the years (after deducting all fees and expenses
and assuming reinvestment of all dividends). The table also sets forth average
annual total return data for the Value Fund for the one, five and ten year
periods ended September 30, 1999, calculated in accordance with SEC standardized
formulas.
<TABLE>
<CAPTION>
VALUE OF VALUE OF VALUE OF
INITIAL CUMULATIVE CUMULATIVE TOTAL ANNUAL
$25,000 CAPITAL GAIN REINVESTED VALUE OF RATE OF
PERIOD ENDED INVESTMENT DISTRIBUTIONS DIVIDENDS SHARES RETURN
------------ ---------- ------------- --------- ------ ------
<S> <C> <C> <C> <C> <C>
May 9, 1986 $25,000 -- -- $25,000 --
Dec. 31, 1986 25,863 -- -- 25,863 3.5%+
Dec. 31, 1987 24,253 264 1,205 25,722 -0.5
Dec. 31, 1988 27,430 299 2,223 29,952 16.5
Dec. 31, 1989 30,763 2,103 3,701 36,567 22.1
Dec. 31, 1990 28,040 2,112 4,500 34,652 -5.2
Dec. 31, 1991 33,940 3,811 6,475 44,226 27.6
Dec. 31, 1992 36,350 6,019 7,884 50,253 13.6
Dec. 31, 1993 42,010 9,114 9,199 60,323 20.0
Dec. 31, 1994 36,075 10,414 7,899 54,388 -9.8
Dec. 31, 1995 45,955 17,447 11,855 75,257 38.4
Dec. 31, 1996 51,478 24,054 13,792 89,324 18.7
Dec. 31, 1997 62,878 42,824 18,398 124,100 38.9
Dec. 31, 1998 72,675 65,163 22,181 160,019 28.9
Sept. 30, 1999 80,375 75,851 24,886 181,112 13.2++
</TABLE>
The fund's average annual total return for the one, five and ten year periods
ending September 30, 1999, was 27.2%, 25.9% and 17.3%, respectively. These
returns assume redemption at the end of each period and reinvestment of
dividends.
Since inception, the total amount of capital gains distributions reinvested in
shares was $49,433, and the total amount of income distributions reinvested was
$11,221. This information represents past performance of the fund and is not
indicative of future performance. The investment return and the 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. Additional information is
available from the Weitz Funds at the address listed on the front cover.
+Return is for the period 5/9/86 through 12/31/86
++Return is for the period 1/1/99 through 9/30/99
3
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
SEPTEMBER 30, 1999 - SEMI-ANNUAL REPORT
October 4, 1999
Dear Fellow Shareholder:
In the 3rd quarter of 1999, the Value Fund declined by 2.9% (after
expenses), while the S&P 500 fell by 6.2%. This brings our gain for the year to
+13.2% vs. +5.4% for the S&P 500.
The table below shows the fund's returns over various intervals and
compares it to the performances of the S&P 500 (very large companies), the
Russell 2000 (an index of smaller company stocks), and our peer group of mutual
funds (according to Lipper Analytical Services). All of the performance data
assume reinvestment of dividends and are calculated after deducting expenses.
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------- -------- -------- --------
<S> <C> <C> <C> <C>
VALUE FUND 27.2% 29.2% 25.9% 17.3%
S&P 500 Index 27.8 25.1 25.0 16.8
Russell 2000 Index 19.2 8.7 12.4 10.9
Average Growth and Income Fund 20.6 17.3 19.0 13.5
</TABLE>
PORTFOLIO REVIEW
Stocks in general have been weaker than the major market indexes would
indicate. More than half of the S&P 500 stocks are down for the year, the
average stock is down over 20% from its 1999 high, and so on. Our total return
through September has held up primarily because of strength in our media and
telecommunications stocks, but many of our financial service and real estate
stocks have been very weak. I don't think this is really bad news, because the
(presumably temporary) decline creates opportunity for us.
We went into the 3rd quarter with very high cash and other reserves (31%),
and during the quarter, our fund received net new funds from investors of over
$150 million. As the market weakened, we bought more of several of our favorite
stocks and added a few new companies to the portfolio. In addition to deploying
the new cash, we reduced our reserves to 20% of the portfolio.
I have no idea where the bottom of the current decline will be -- I would
not be surprised by a further correction of the excesses of the '90's -- but I
feel very good about the stocks in our portfolio. Here are some examples:
BANKS -- Greenpoint, Golden State, and Washington Mutual are large, profitable,
growing banks selling at about 7 times next year's earnings per share and buying
back their own stock. With modest earnings growth and some P/E multiple
expansion, 50% total returns over the next 2-3 years seem like a realistic
possibility. Several other banks in our portfolio have similar potential.
4
<PAGE>
REAL ESTATE -- Host Marriott, Hilton, Forest City, and Catellus are all selling
at discounts to the current liquidation values of their underlying real estate,
and each is generating strong cash flows that are available for dividends,
acquisitions, and stock buybacks. Host Marriott is a real estate investment
trust (REIT) that owns luxury and full-service hotels such as Ritz Carlton, Four
Seasons, Marriott, and Hyatt. Their properties could probably be sold for $13-15
per share with one phone call, yet the stock sells for about $9. The $.84
dividend is well covered and provides a 9% current yield, and the underlying
value of the business is growing. The other three companies are not REITs and do
not pay large dividends, but the degrees of under-valuation are similar. In each
case, the expectation of a total return of 50% over the next 2-3 years does not
seem outlandish.
MORTGAGE BANKING -- Countrywide Credit has two parts to its business -- creating
mortgages and servicing mortgages. Creating mortgages, to finance a home
purchase or to refinance an existing mortgage, generates one-time origination
fee income. Servicing involves collecting monthly payments and dealing with
escrow accounts, and generates a stream of fee income over the life of the
mortgage. Higher interest rates generally mean lower mortgage creation activity,
thus lower origination fees, but it also means that existing mortgages remain
outstanding longer so the value of the servicing "annuity" rises. As interest
rates have risen in recent months, investors have focused on the negative side
of this equation and ignored the positive, so Countrywide has declined from over
$50 per share (where we had been sellers) to a recent $32. At this level,
Countrywide sells at under 9 times this year's expected earnings and we have
added significantly to our position in the low- to mid-30's. Other mortgage
bankers which focus on originations, such as New Century Financial and Resource
Bancshares Mortgage, are more adversely affected by higher rates, but both
stocks are so severely depressed that they ought to be good contributors to our
future results from today's prices.
OTHER FINANCIAL SERVICES -- Fears of higher interest rates, a slower economy, a
weaker stock market, etc. have depressed several others of our financial
services companies. United Asset Management is a holding company of investment
management businesses whose stock sells for about 50-60% of its value in a
takeover. It has operating problems that I believe are fixable, and it is buying
in its own stock very aggressively. Berkshire Hathaway has fallen from over
$80,000 per share to under $55,000 over the past 18 months, and now sells very
close to its adjusted book value and well below its intrinsic business value.
Redwood Trust sells at $13, while its portfolio has a liquidation value of $22,
and its management is very intelligent, motivated, and shareholder-oriented. It
has become a relatively small position in our portfolio since we own as many
shares as the company's by-laws permit and our portfolio has grown while its
price has shrunk. However, the risk-reward equation for Redwood and several
other smaller financial companies appears to be very favorable.
UTILITIES -- Western Resources (WR) is an electric utility that has been tangled
in a merger transaction with Kansas City Power and Light (KLT) for several
years. During this period, regulators and politicians have complicated the
process, and WR's earning power has been obscured by losses in its home security
subsidiary. Western also owns over $12 per WR share of ONEOK and Hanover
Compressor securities. We believe that the aggregate value of WR's assets is
considerably greater than its current price of $21. In the meantime, we receive
a large dividend. Citizens Utilities is also a company with great assets,
selling at a significant discount to their underlying value, whose management
has announced plans to restructure the company in order to recognize value. This
is the same management that built and sold Century Communications and Centennial
Cellular, which have contributed a significant portion of our fund's performance
over the past several years.
5
<PAGE>
CABLE TELEVISION AND CELLULAR TELEPHONE -- We have lost many of our cable and
cellular stocks to takeovers, and those that remain are not as cheap as they
used to be. Nevertheless, they are strong companies with good futures. Our
favorite is Liberty Media. It is a fabulous collection of programming and other
media assets, managed by John Malone. The recent FORBES cover story on Malone
does a great job of explaining our attraction to Liberty.
CASH RESERVES AND MARKET TIMING -- While our cash reserves are at new lows for
the year, at 20%, they are still high by mutual fund standards. Some define
market timing as holding cash positions of over 5-10%. I don't agree. From my
point of view, market timing is selling stocks that one likes at current prices
in hopes of being able to buy them back cheaper after an expected general market
decline. Holding cash in lieu of buying fully valued or over-priced stocks is
not market timing, in my opinion, but the essence of value investing. Whatever
your point of view on the semantics, shareholders should know that I will hold
cash at times.
OUTLOOK
As I have said regularly, there are many signs of speculative excess and
naive "investment" behavior that cry out for a harsh dose of reality in the form
of a market correction or bear market. However, it may not happen that way.
Individual stocks and groups of stocks have already taken terrible beatings for
seemingly minor offenses, such as "missing" a quarterly earnings estimate by a
penny per share. The supply of credit available for speculative or
over-leveraged business ventures has dried up considerably since the summer of
1998. Some investors are at least BEGINNING to raise questions about the
Internet Emperors' new clothes. Fears of recession and/or higher interest rates
have caused many stocks (such as the financial and real estate companies
mentioned above) to drop sharply in anticipation of bad news. Maybe this
"rolling correction" will take the place of an old-fashioned bear market. I
don't know.
What I do know is that over the past 25 years, buying good businesses at
reasonable prices has worked well. I feel very good about our portfolio's
potential for long-term returns, and I believe that these stocks will serve us
well over the years, as long as we have patience.
Sincerely,
/S/ WALLACE R. WEITZ
Wallace R. Weitz
President, Portfolio
Manager
6
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
SCHEDULE OF INVESTMENTS IN SECURITIES
SEPTEMBER 30, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
SHARES
OR UNITS COST VALUE
- ----------- -------------- --------------
<C> <S> <C> <C>
COMMON STOCKS -- 78.6%
AUTO SERVICES -- 0.4%
645,100 Insurance Auto Auctions, Inc.* $ 7,525,098 $ 9,595,863
-------------- --------------
BANKING -- 13.6%
165,300 Astoria Financial Corp. 6,107,297 5,082,975
25,000 Cohoes Bancorp, Inc.* 281,875 290,625
1,887,320 Commercial Federal Corp. 41,896,256 37,038,655
465,000 East West Bancorp, Inc. 4,439,375 5,521,875
67,500 First Federal Bankshares, Inc. 672,813 615,938
646,000 First Place Financial Corp. 6,915,938 7,348,250
4,718,900 Golden State Bancorp, Inc.* 93,627,036 84,645,269
1,999,900 Greenpoint Financial Corp. 55,220,904 53,122,344
343,300 Local Financial Corp.* 3,191,222 3,175,525
1,556,700 North Fork Bancorporation, Inc. 29,579,628 30,355,650
105,000 Roslyn Bancorp, Inc. 1,805,000 1,876,875
220,000 South Jersey Financial Corp., Inc.* 2,384,433 3,176,250
400,000 Troy Financial Corp.* 3,977,744 4,325,000
616,000 U.S. Bancorp 19,589,126 18,595,500
447,000 Virginia Capital Bancshares, Inc. 5,719,344 6,649,125
1,916,000 Washington Mutual, Inc. 68,075,669 56,043,000
-------------- --------------
343,483,660 317,862,856
-------------- --------------
CABLE TELEVISION -- 5.0%
415,700 Adelphia Communications Corp. CL A* 13,774,999 24,448,356
1,342,000 Century Communications Corp. CL A* 7,924,704 61,228,750
175,000 Comcast Corp. Special CL A 835,050 6,978,125
344,000 MediaOne Group, Inc.* 9,567,697 23,499,500
-------------- --------------
32,102,450 116,154,731
-------------- --------------
CONSUMER PRODUCTS AND SERVICES -- 1.4%
679,400 American Classic Voyages Co.* 11,028,863 15,583,737
622,350 LabOne, Inc. 8,611,762 5,834,531
4,875 Lady Baltimore Foods, Inc. CL A 227,781 301,031
2,744,000 Protection One, Inc. 14,948,651 10,976,000
-------------- --------------
34,817,057 32,695,299
-------------- --------------
FEDERAL AGENCIES -- 3.6%
75,000 Fannie Mae 1,270,544 4,701,562
90,000 Freddie Mac 385,147 4,680,000
1,735,900 SLM Holding Corp. 61,023,762 74,643,700
-------------- --------------
62,679,453 84,025,262
-------------- --------------
</TABLE>
See accompanying notes to financial statements.
7
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
SCHEDULE OF INVESTMENTS IN SECURITIES, CONTINUED
<TABLE>
<CAPTION>
SHARES
OR UNITS COST VALUE
- ----------- -------------- --------------
<C> <S> <C> <C>
FINANCIAL SERVICES -- 9.5%
1,357,300 Allied Capital Corp. $ 23,911,458 $ 30,454,419
350,000 American Capital Strategies, Ltd. 5,950,000 6,475,000
160 Berkshire Hathaway, Inc. CL A* 4,906,000 8,800,000
37,965 Berkshire Hathaway, Inc. CL B* 80,893,995 70,463,040
79,205 Heller Financial, Inc. 2,136,576 1,782,113
2,835,500 Imperial Credit Industries, Inc.* 37,083,542 12,405,312
1,541,850 The PMI Group, Inc. 44,124,709 63,023,119
30,000 PS Group Holdings, Inc. 117,625 318,750
1,457,700 United Asset Management Corp. 34,100,034 28,060,725
300,000 United Panam Financial Corp.* 2,019,813 581,250
-------------- --------------
235,243,752 222,363,728
-------------- --------------
INFORMATION AND DATA PROCESSING -- 1.1%
1,055,600 Data Transmission Network Corp.* 23,690,812 26,324,025
180,000 Intelligent Systems Corp.* 380,869 427,500
-------------- --------------
24,071,681 26,751,525
-------------- --------------
LODGING AND GAMING -- 5.1%
546,000 Harrah's Entertainment, Inc.* 7,985,042 15,151,500
4,310,900 Hilton Hotels Corp. 48,839,486 42,570,137
709,000 Mandalay Resort Group* 9,086,282 14,002,750
3,841,500 Park Place Entertainment Corp.* 23,557,302 48,018,750
-------------- --------------
89,468,112 119,743,137
-------------- --------------
MEDIA AND ENTERTAINMENT -- 8.1%
3,404,536 AT&T Corp. -- Liberty Media Group A* 56,836,073 126,393,399
221,270 Chris-Craft Industries, Inc.* 9,212,917 12,418,779
58,700 Daily Journal Corp.* 1,306,716 2,149,888
300,000 Gabelli Global Multimedia Trust, Inc. 2,071,150 4,350,000
1,020,300 Valassis Communications, Inc.* 19,286,704 44,829,431
-------------- --------------
88,713,560 190,141,497
-------------- --------------
MORTGAGE BANKING -- 6.2%
2,896,300 Countrywide Credit Industries, Inc. 103,936,234 93,405,675
610,000 Franchise Mortgage Acceptance Co.* 5,403,270 4,346,250
2,252,000 Long Beach Financial Corp.* 30,856,433 35,750,500
253,000 New Century Financial Corp.* 2,418,625 4,459,125
1,380,400 Resource Bancshares Mtg. Grp., Inc. 18,271,246 6,858,862
391,606 WMF Group, Limited* 2,762,590 1,346,146
-------------- --------------
163,648,398 146,166,558
-------------- --------------
PRINTING SERVICES -- 0.4%
755,100 Mail-Well, Inc.* 10,239,505 10,477,012
-------------- --------------
</TABLE>
See accompanying notes to financial statements.
8
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
SCHEDULE OF INVESTMENTS IN SECURITIES, CONTINUED
<TABLE>
<CAPTION>
SHARES
OR UNITS COST VALUE
- ----------- -------------- --------------
<C> <S> <C> <C>
REAL ESTATE AND CONSTRUCTION -- 1.9%
2,738,100 Catellus Development Corp.* $ 36,374,181 $ 32,172,675
545,600 Forest City Enterprises, Inc. CL A 11,075,278 12,173,700
30,000 Syntroleum Corp.* 95,750 211,875
-------------- --------------
47,545,209 44,558,250
-------------- --------------
REAL ESTATE INVESTMENT TRUSTS -- 4.9%
1,571,500 Capital Automotive REIT 20,768,123 19,447,312
416,000 Dynex Capital, Inc. 11,646,215 2,808,000
1,287,980 Fortress Investment Corp. 24,946,570 21,895,660
301,300 Hanover Capital Mortgage Holdings, Inc. 3,265,468 1,205,200
72,000 Healthcare Financial Partners Units** 7,200,000 7,200,000
3,980,000 Host Marriott Corp. 36,744,272 37,810,000
465,000 IMPAC Mortgage Holdings, Inc. 6,666,907 2,150,625
576,200 Imperial Credit Commercial Mtg. Inv. Corp. 6,080,510 6,338,200
475,000 NovaStar Financial, Inc. 7,282,611 1,662,500
1,198,117 Redwood Trust, Inc. 28,274,792 15,500,639
-------------- --------------
152,875,468 116,018,136
-------------- --------------
RESTAURANTS -- 0.5%
690,200 CBRL Group, Inc. 11,149,531 10,698,100
-------------- --------------
RETAIL DISCOUNT -- 0.9%
930,000 Consolidated Stores Corp.* 14,741,665 20,518,125
-------------- --------------
TELECOMMUNICATIONS -- 10.4%
236,800 Alltel Corp. 5,730,786 16,664,800
362,000 Centennial Cellular Corp. CL A* 4,043,194 16,448,375
561,000 Corecomm, Limited* 3,350,600 18,477,938
1,524,500 Telephone and Data Systems, Inc. 64,605,265 135,394,656
845,700 United States Cellular Corp.* 30,975,659 57,507,600
-------------- --------------
108,705,504 244,493,369
-------------- --------------
UTILITIES -- 5.6%
6,473,700 Citizens Utilities Co. CL B * 65,216,773 73,233,731
24,100 Empire District Electric Co. 615,996 616,056
325,000 Kansas City Power and Light Co. 7,531,875 7,860,938
2,338,200 Western Resources Inc. 59,701,491 49,979,025
-------------- --------------
133,066,135 131,689,750
-------------- --------------
Total Common Stocks 1,560,076,238 1,843,953,198
-------------- --------------
</TABLE>
See accompanying notes to financial statements.
9
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
SCHEDULE OF INVESTMENTS IN SECURITIES, CONTINUED
<TABLE>
<CAPTION>
SHARES
OR UNITS COST VALUE
- ----------- -------------- --------------
<C> <S> <C> <C>
WARRANTS -- 0.0%
338,100 Hanover Capital Mtg. Holdings, Inc., Expiring 9/15/00 $ 42,263 $ 21,131
350,000 NovaStar Financial, Inc., Expiring 2/03/01 175,000 43,750
-------------- --------------
Total Warrants 217,263 64,881
-------------- --------------
CONVERTIBLE PREFERRED STOCKS -- 0.6%
2,100,000 NovaStar Financial, Inc. 7% Pfd. Class B Cumulative 14,700,000 14,700,000
-------------- --------------
NON-CONVERTIBLE PREFERRED STOCKS -- 0.1%
15,000 Crown American Realty Trust 11% Pfd. Series A 667,500 618,750
30,000 Prime Retail, Inc. 10.5% Pfd. Series A 645,000 510,000
34,000 RB Asset, Inc. 15.0% Pfd. Series A 845,750 510,000
-------------- --------------
Total Non-Convertible Preferred Stocks 2,158,250 1,638,750
-------------- --------------
</TABLE>
<TABLE>
<CAPTION>
FACE
AMOUNT
- -----------
<C> <S> <C> <C>
CORPORATE BONDS -- 0.3%
$ 4,500,000 USA Networks, Inc. 7.0% 7/01/03 4,420,672 4,359,375
750,000 Local Financial Corp. 11.0% 9/08/04 750,000 776,250
2,000,000 Harcourt General 6.5% 5/15/11 1,943,730 1,830,000
-------------- --------------
Total Corporate Bonds 7,114,402 6,965,625
-------------- --------------
U.S. GOVERNMENT AND AGENCY SECURITIES -- 4.2%
15,000,000 U.S. Treasury Note 5.5% 3/31/00 14,993,449 15,032,820
4,750,000 Fannie Mae 6.625% 7/12/00 4,750,259 4,781,060
13,000,000 Federal Home Loan Bank 5.5% 7/14/00 12,988,548 12,974,039
40,000,000 Freddie Mac 5.0% 02/15/01 39,548,452 39,507,840
17,500,000 Fannie Mae 5.88% 3/25/04 17,419,163 17,055,448
3,000,000 Federal Home Loan Bank 6.04% 9/08/05 3,000,000 2,897,058
1,000,000 Federal Home Loan Bank 6.44% 11/28/05 1,000,987 996,689
6,000,000 Fannie Mae 6.56% 11/26/07 6,000,000 5,837,718
-------------- --------------
Total U.S. Government and Agency Securities 99,700,858 99,082,672
-------------- --------------
</TABLE>
See accompanying notes to financial statements.
10
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
SCHEDULE OF INVESTMENTS IN SECURITIES, CONTINUED
<TABLE>
<CAPTION>
FACE
AMOUNT COST VALUE
- ----------- -------------- --------------
<C> <S> <C> <C>
SHORT-TERM SECURITIES -- 16.9%
$60,652,945 Norwest U. S. Government Money Market Fund $ 60,652,945 $ 60,652,945
49,250,000 U. S. Treasury Bill 11/04/99 49,040,942 49,043,002
83,200,000 U. S. Treasury Bill 11/12/99 82,773,058 82,770,938
25,000,000 Freddie Mac Discount Note 11/22/99 24,811,302 24,815,100
30,250,000 Fannie Mae 4.78% 11/30/99 30,248,169 30,219,085
40,000,000 Freddie Mac Discount Note 12/09/99 39,619,733 39,604,400
110,000,000 Freddie Mac Discount Note 1/27/00 108,015,329 108,125,160
-------------- --------------
Total Short-Term Securities 395,161,478 395,230,630
-------------- --------------
Total Investments in Securities $2,079,128,489 2,361,635,756
============== --------------
Other Liabilities in Excess of Other Assets -- (0.7%) (17,152,763)
--------------
Total Net Assets -- 100% $2,344,482,993
==============
Net Asset Value Per Share $ 32.15
==============
</TABLE>
*Non-income producing
**Each unit, which is restricted as to sale, consists of five shares of common
stock and one stock purchase warrant. The company distributed an additional
warrant per unit to unitholders during 1998. The warrants currently have no
value or cost assigned to them.
See accompanying notes to financial statements.
11
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1999
(UNAUDITED)
<TABLE>
<S> <C>
Assets:
Investment in securities at value (cost $2,079,128,489) $2,361,635,756
Accrued interest and dividends receivable 4,454,360
Receivable for securities sold 4,070,887
--------------
Total assets 2,370,161,003
--------------
Liabilities:
Due to adviser 2,128,063
Payable for securities purchased 23,221,480
Other liabilities 328,467
--------------
Total liabilities 25,678,010
--------------
Net assets applicable to outstanding capital stock $2,344,482,993
==============
Net assets represented by:
Additional paid-in capital (note 4) 2,006,413,158
Accumulated undistributed net investment income 13,769,080
Accumulated undistributed net realized gains 41,793,488
Net unrealized appreciation of investments (note 5) 282,507,267
--------------
Total representing net assets applicable to
shares outstanding $2,344,482,993
==============
Net asset value per share of outstanding capital stock
(72,915,435 shares outstanding) $ 32.15
==============
</TABLE>
See accompanying notes to financial statements.
12
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 1999
(UNAUDITED)
<TABLE>
<S> <C> <C>
Investment income:
Dividends $10,486,708
Interest 16,108,253
-----------
Total investment income 26,594,961
-----------
Expenses (note 3):
Investment advisory fee 10,778,275
Administrative fee 1,399,691
Directors fees 5,150
Dividends on securities sold short 33,000
Other expenses 606,400
-----------
Total expenses 12,822,516
-----------
Net investment income 13,772,445
-----------
Realized and unrealized gain on investments:
Net realized gain on securities $39,847,248
Net realized gain on options written 312,953
Net realized gain on securities sold short 1,800,609
-----------
Net realized gain 41,960,810
-----------
Net unrealized appreciation of investments 42,287,974
-----------
Net realized and unrealized gain on investments 84,248,784
-----------
Net increase in net assets resulting from
operations $98,021,229
===========
</TABLE>
See accompanying notes to financial statements.
13
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
SEPT. 30, 1999 YEAR ENDED
(UNAUDITED) MARCH 31, 1999
---------------- ---------------
<S> <C> <C>
Increase (decrease) in net assets:
From operations:
Net investment income $ 13,772,445 $ 12,109,837
Net realized gain 41,960,810 83,334,331
Net unrealized appreciation 42,287,974 90,647,280
-------------- --------------
Net increase in net assets resulting from
operations 98,021,229 186,091,448
-------------- --------------
Distributions to shareholders from:
Net investment income (4,341,093) (6,752,686)
Net realized gain (46,239,217) (70,722,258)
-------------- --------------
Total distributions (50,580,310) (77,474,944)
-------------- --------------
Capital share transactions (note 4):
Proceeds from sales 883,527,985 1,385,279,195
Payments for redemptions (324,761,571) (324,158,069)
Reinvestment of distributions 47,244,163 73,017,382
-------------- --------------
Total increase from capital share transactions 606,010,577 1,134,138,508
-------------- --------------
Total increase in net assets 653,451,496 1,242,755,012
-------------- --------------
Net assets:
Beginning of period 1,691,031,497 448,276,485
-------------- --------------
End of period $2,344,482,993 $1,691,031,497
============== ==============
</TABLE>
See accompanying notes to financial statements.
14
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
FINANCIAL HIGHLIGHTS
The following information provides selected data for a share of the Value
Fund outstanding throughout the periods indicated.
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED MARCH 31,
SEPT. 30, 1999 ------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995
---------------- ---------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD: $ 31.02 $ 29.31 $ 20.99 $ 19.46 $ 15.55 $ 15.68
---------- ---------- -------- -------- -------- --------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment income 0.16 0.27 0.22 0.18 0.16 0.15
Net gains or losses on securities
(realized and unrealized) 1.74 4.62 11.02 2.58 5.25 0.45
---------- ---------- -------- -------- -------- --------
Total from investment operations 1.90 4.89 11.24 2.76 5.41 0.60
---------- ---------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net investment
income (0.07) (0.17) (0.31) (0.13) (0.42) --
Distributions from realized gains (0.70) (3.01) (2.61) (1.10) (1.08) (0.73)
---------- ---------- -------- -------- -------- --------
Total distributions (0.77) (3.18) (2.92) (1.23) (1.50) (0.73)
---------- ---------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 32.15 $ 31.02 $ 29.31 $ 20.99 $ 19.46 $ 15.55
========== ========== ======== ======== ======== ========
TOTAL RETURN 6.1% 18.0% 58.8% 14.3% 35.9% 4.1%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period ($000) $2,344,483 $1,691,031 $448,276 $275,597 $170,509 $118,776
Ratio of expenses to average net
assets 1.19%* 1.26% 1.27% 1.29% 1.35% 1.42%
Ratio of net investment income to
average net assets 1.28%* 1.35% 0.87% 0.93% 0.91% 1.06%
Portfolio turnover rate 15% 36% 39% 39% 40% 28%
</TABLE>
*Annualized
See accompanying notes to financial statements.
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS
16
<PAGE>
WEITZ SERIES FUND, INC. -- VALUE FUND
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1999
(UNAUDITED)
(1) ORGANIZATION
Weitz Series Fund, Inc. (the "Company"), is registered under the Investment
Company Act of 1940 as an open-end diversified management investment company
issuing shares in series, each series representing a distinct portfolio with
its own investment objectives and policies. At September 30, 1999, the
Company had four series: the Value Fund, the Fixed Income Fund, the
Government Money Market Fund, and the Hickory Fund. The accompanying
financial statements present the financial position and results of
operations of the Value Fund (the "Fund").
The Fund's investment objective is capital appreciation. The Fund invests
principally in common stocks, preferred stocks and a variety of securities
convertible into equity such as rights, warrants, preferred stocks and
convertible bonds.
(2) SIGNIFICANT ACCOUNTING POLICIES
The following accounting policies are in accordance with accounting policies
generally accepted in the investment company industry.
(a) VALUATION OF INVESTMENTS
Investments are carried at value determined using the following valuation
methods:
- Securities traded on a national or regional securities exchange
and over-the-counter securities traded on the NASDAQ national
market are valued at the last sales price; if there were no sales
on that day, securities are valued at the mean between the latest
available and representative bid and asked prices.
- Securities not listed on an exchange are valued at the mean
between the latest available and representative bid and ask
prices.
- The value of certain debt securities for which market quotations
are not readily available may be based upon current market prices
of securities which are comparable in coupon, rating and maturity
or an appropriate matrix utilizing similar factors.
- The value of securities for which market quotations are not
readily available, including restricted and not readily marketable
securities, is determined in good faith under the supervision of
the Company's Board of Directors.
When the Fund writes a call option, an amount equal to the premium
received by the Fund is included in the Fund'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
17
<PAGE>
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 Fund enters into a
closing purchase transaction, the Fund 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 Fund realizes a gain
or loss from the sale of the underlying security and the proceeds from
such sale are increased by the premium originally received.
The risk in writing a call option is that the Fund gives up the
opportunity of profit if the market price of the security increases. The
Fund also has the additional risk of not being able to enter into a
closing transaction if a liquid secondary market does not exist.
(b) FEDERAL INCOME TAXES
Since the Fund'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 Fund.
(c) SECURITY TRANSACTIONS AND DISTRIBUTIONS TO SHAREHOLDERS
Security transactions are accounted for on the date the securities are
purchased or sold (trade date). Income dividends and dividends on short
positions are recorded on the ex-dividend date. Interest, including
amortization of discount or premium, is accrued as earned. Distributions
to shareholders are recorded on the ex-dividend date.
Realized gains or losses are determined by specifically identifying the
security sold.
(d) 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.
(e) SECURITIES SOLD SHORT
The Fund periodically engages in selling securities short, which
obligates the Fund to replace a security borrowed by purchasing the same
security at the current market value. The Fund would incur a loss if the
price of the security increases between the date of the short sale and
the date on which the Fund replaces the borrowed security. The Fund would
realize a gain if the price of the security declines between those dates.
18
<PAGE>
The Fund is required to establish a margin account with the broker
lending the security sold short. While the short sale is outstanding, the
broker retains the proceeds of the short sale. The Fund will place in a
segregated account a sufficient amount of cash and securities as required
by applicable federal securities regulations in order to cover the
transaction.
(3) RELATED PARTY TRANSACTIONS
The Company and Fund have retained Wallace R. Weitz & Company (the
"Adviser") as their investment adviser. In addition, the Company has an
agreement with Weitz Securities, Inc. to act as distributor for the Fund's
shares. Certain officers and directors of the Company are also officers and
directors of the Adviser and Weitz Securities, Inc.
Under the terms of a management and investment advisory agreement, the
Adviser receives an investment advisory fee equal to 1% per annum of the
Fund's average daily net asset value. The Adviser has agreed to reimburse
the Fund up to the amount of advisory fees paid to the extent that total
expenses exceed 1.50% of the Fund's average annual daily net asset value.
The expenses incurred by the Fund did not exceed the percentage limitation
during the year ended September 30, 1999.
Under the terms of an administration agreement, certain services are being
provided including the transfer of shares, disbursement of dividends, fund
accounting and related administrative services of the Company for which the
Adviser is being paid a monthly fee. During the six months ended
September 30, 1999, the fee was calculated at an average annual rate of .13%
of the Fund's average daily net assets.
Weitz Securities, Inc. as distributor, received no compensation for
distribution of Fund shares.
(4) CAPITAL STOCK
The Company is authorized to issue a total of five billion shares of common
stock in series with a par value of $.001. One hundred fifty million of
these shares have been authorized by the Board of Directors to be issued in
the series designated Value Fund. The Board of Directors may authorize
additional shares in other series of the Company's shares without
shareholder approval. Each share of stock will have a pro rata interest in
the assets of the series to which the stock of that series relates and will
have no interest in the assets of any other series.
19
<PAGE>
Transactions in the capital stock of the Fund are summarized as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
SEPTEMBER 30, 1999 YEAR ENDED
(UNAUDITED) MARCH 31, 1999
------------------- ---------------
<S> <C> <C>
Transactions in shares:
Shares issued................................... 26,916,095 47,995,546
Shares redeemed................................. (9,960,827) (11,332,079)
Reinvested dividends............................ 1,436,866 2,566,143
---------- -----------
Net increase.................................. 18,392,134 39,229,610
========== ===========
</TABLE>
(5) SECURITIES TRANSACTIONS
Purchases and proceeds from maturities or sales of investment securities of
the Fund, other than short-term securities, aggregated $1,003,872,693 and
$234,437,131 respectively. The cost of investments for Federal income tax
purposes is $2,079,202,314. At September 30, 1999, the aggregate gross
unrealized appreciation and depreciation, based on cost for Federal income
tax purposes, were $447,083,497 and $164,650,054, respectively.
Transactions relating to covered call options during the six months ended
September 30, 1999, are summarized as follows:
<TABLE>
<CAPTION>
NUMBER OF
OPTIONS PREMIUM
--------- ----------
<S> <C> <C>
Options written, beginning of period...................... 259,500 $1,327,088
Options split, during the period.......................... 32,500 0
Options written, during the period........................ 75,000 696,164
Options expired, during the period........................ (70,000) (349,379)
Options exercised, during the period...................... (162,000) (776,559)
Options closed, during the period......................... (135,000) (897,314)
-------- ----------
Options outstanding, end of period........................ 0 $ 0
======== ==========
</TABLE>
20
<PAGE>
(6) AFFILIATED ISSUERS
Affiliated issuers, as defined under the Investment Company Act of 1940, are
those in which the Company's holdings of an issuer represent 5% or more of
the outstanding voting securities of the issuer. A summary of the Company's
holdings in the securities of such issuers is set forth below:
<TABLE>
<CAPTION>
NUMBER OF
SHARES HELD VALUE DIVIDEND REALIZED
NAME OF ISSUER SEPT. 30, 1999 SEPT. 30, 1999 INCOME GAINS/(LOSSES)
- ----------------------------------------- --------------- -------------- ---------- --------------
<S> <C> <C> <C> <C>
Capital Automotive REIT.................. 1,571,500 $ 19,447,312 $ 936,309 $ 0
Data Transmission Network Corp........... 1,055,600 26,324,025 0 0
First Place Financial Corp............... 646,000 7,348,250 48,450 0
Fortress Investment Corp................. 1,287,980 21,895,660 643,990 0
Hanover Capital Mortgage Holdings Inc.... 301,300 1,205,200 90,390 0
Imperial Credit Industries, Inc.......... 2,835,500 12,405,312 0 0
Insurance Auto Auctions, Inc............. 645,100 9,595,863 0 0
LabOne, Inc.............................. 622,350 5,834,531 231,213 4,548
Long Beach Financial Corp................ 2,252,000 35,750,500 0 0
NovaStar Financial, Inc.................. 475,000 1,662,500 0 0
NovaStar Financial, Inc. Warrants,
Expiring 2/03/01........................ 350,000 43,750 0 0
NovaStar Financial, Inc. 7% Pfd. Class B
Cumulative.............................. 2,100,000 14,700,000 274,400 0
The PMI Group, Inc....................... 1,541,850 63,023,119 113,069 0
Redwood Trust, Inc....................... 1,198,117 15,500,639 0 0
Resource Bancshares Mtg. Grp., Inc....... 1,380,400 6,858,862 303,688 0
South Jersey Financial Corp., Inc........ 220,000 3,176,250 0 219,973
------------ ---------- --------
Totals................................... $244,771,773 $2,641,509 $224,521
============ ========== ========
</TABLE>
21
<PAGE>
WEITZ SERIES FUND, INC.
WEITZ VALUE FUND
YEAR 2000 UPDATE
Wallace R. Weitz & Company ("Weitz"), investment adviser and administrator
for the Weitz Funds, has developed a plan to address whether its systems will
operate correctly after December 31, 1999. The plan has been reviewed by Weitz's
management and by the Board of Directors of Weitz Series Fund, Inc. and Weitz
Partners, Inc. Weitz has assigned one employee to take the lead on Year 2000
issues and is also working with a consulting firm to assist in the remediation
of hardware and software systems. Regular reports are made to the Board of
Directors. Weitz has agreed to commit the resources necessary to address the
Year 2000 issue.
Weitz's local area network is comprised of a single file server, two
application servers, and individual workstations with desktop machines, related
peripherals and software developed by third parties. Such software is a
combination of off-the-shelf applications and accounting or industry specific
applications developed by third party vendors. Weitz has no internally developed
or modified software applications. Due to the recent growth of the Weitz Funds,
Weitz has replaced its entire network within the past two years. These changes
have all been effected with Year 2000 compliance issues in mind. Weitz has been
in communication with critical third party service providers who have provided
assurances to us that they are either Year 2000 compliant or are in the final
stages of testing. Because of recent growth and the need for certain increased
efficiencies and technological capabilities, Weitz has recently changed some of
its third party service providers. This process has involved obtaining
assurances about the Year 2000 readiness of the new providers.
With respect to the companies in which the Weitz Funds invest, Weitz
intends to review the disclosure included in regular filings with the Securities
and Exchange Commission for certain of those companies in which the funds have a
significant investment. In addition, Weitz receives and will continue to receive
Y2K readiness information from securities analysts and from certain of the
issuing companies themselves. Such information is reviewed as it becomes
available. Weitz and the Weitz Funds have no reason to believe that these steps
will not be sufficient to avoid any material adverse impact on the Funds,
although there can be no assurance of this.
22
<PAGE>
WEITZ SERIES FUND, INC.
WEITZ VALUE FUND
CHANGE IN INDEPENDENT ACCOUNTANTS
On August 13, 1999, McGladrey & Pullen, LLP ("McGladrey") resigned as
independent auditors of the Fund pursuant to an agreement by
PricewaterhouseCoopers, LLP ("PwC") to acquire McGladrey's investment company
practice. The McGladrey partners and professionals serving the Fund at the time
of the acquisition joined PwC. The reports of McGladrey on the financial
statements of the Fund during the past two fiscal years contained no adverse
opinion or disclaimer of opinion, and were not qualified or modified as to
uncertainty, audit scope or accounting principles. In connection with its audits
for the two most recent fiscal years and through August 13, 1999, there were no
disagreements with McGladrey on any matter of accounting principle or practices,
financial statement disclosure, or auditing scope or procedure, which
disagreements, if not resolved to the satisfaction of McGladrey would have
caused it to make reference to the subject matter of disagreement in connection
with its report. On July 30, 1999, the Fund, with the approval of its Board of
Directors and its Audit Committee, engaged PwC as its independent auditors.
23
<PAGE>
WEITZ SERIES FUND, INC.
- --------------------------------------------------------------------------------
BOARD OF DIRECTORS
Lorraine Chang
John W. Hancock
Richard D. Holland
Thomas R. Pansing, Jr.
Delmer L. Toebben
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 Minnesota, N.A.
TRANSFER AGENT AND DIVIDEND PAYING
AGENT
Wallace R. Weitz & Company
SUB-TRANSFER AGENT
National Financial Data Services,
Inc.
This report has been prepared
for the information of
shareholders of Weitz
Series Fund, Inc. -- Value
Fund. For more detailed
information about the Fund,
its investment objectives,
management, fees and expenses,
please see a current
prospectus. This report is not
authorized for distribution to
prospective investors unless
preceded or accompanied by a
current prospectus.
510230
