|
|
|
|
|
|
|
|
|
|
Previous: NEW HAMPSHIRE THRIFT BANCSHARES INC, DEF 14A, 1996-03-11 |
Next: COLONIAL INVESTMENT GRADE MUNICIPAL TRUST, N-30D, 1996-03-11 |
New World Investment Fund (SM)
Semi-Annual Report
For the Six Months Ended
December 31, 1995
Seeks a high level of total return over the long term by
investing primarily in securities of Latin American issuers
Fellow Shareholders:
Latin American stock and bond markets weathered a volatile six months during
the second half of 1995. Despite significant interim movements, New World
Investment Fund posted a modest gain during this period, the
first half of its fiscal 1996 year.
The fund gained 2.2% in the six months ended December 31, 1995, assuming
reinvestment of the 59-cent capital gain distribution paid in December, thereby
outpacing the two leading indexes which measure results in Latin America and
emerging markets. The Morgan Stanley Capital International (MSCI) Emerging
Markets Free Latin America Index, the closest approximation of the fund's
investment universe, had a return of -0.3% with dividends reinvested. The MSCI
Emerging Markets Free Index, which gauges returns in 22 developing countries,
returned -2.0%, also with dividends reinvested.
Other markets, notably the U.S. equity market, performed much better. Standard
& Poor's 500 Composite Index gained 14.4% in the last six months of calendar
1995, and the MSCI EAFE(R) (Europe, Australasia, Far East) Index rose 8.6%.
For many Latin American countries, 1995 was a time of economic turmoil that
tested their resolve to continue moving toward market-oriented economies.
Following the devaluation of the Mexican peso in December 1994, stock markets
across Latin America fell sharply. Beginning with the second quarter,
they recovered, only to lose ground again in the final quarter.
During the year, economic growth stagnated and unemployment grew rapidly.
Despite these hardships, countries such as Brazil, Argentina and Mexico, which
together account for approximately 70% of the fund's investments, did not slip
back into protectionism or resort to massive government spending for short-term
relief.
There were other hopeful signs of continuing commitment to economic reform
throughout the region. Argentine Finance Minister Domingo
[Side Bar]
OUR TEN MOST SUCCESSFUL HOLDINGS
for the six months ended December 31, 1995
<TABLE>
<CAPTION>
<S> <C>
Banco Frances del Rio de la Plata (Argentina) +71.70%
Telecomunicacoes Brasileiras (Brazil) +39.35
Telecomunicacoes de Minas Gerais (Brazil) +34.87
Tubos de Acero de Mexico (Mexico) +34.59
Banco de Galicia y Buenos Aires (Argentina) +33.26
Atlantic Tele-Network (United States) +33.08
Kimberly-Clark de Mexico (Mexico) +30.94
Companhia Cervejaria Brahma (Brazil) +25.41
Astra Compania Argentina de Petroleo +23.28
Telecomunicacoes de Sao Paulo-Telesp +18.33
OUR TEN LEAST SUCCESSFUL HOLDINGS
for the six months ended December 31, 1995
CAP (Chile) -31.33%
Invercap (Chile) -31.60
Cementos Diamante (Colombia) -32.69
Rhodia-Ster (Brazil) -36.36
Companhia Siderurgica Belgo Mineira -36.69
Osa (Brazil) -40.83
COFAP-Companhia Fabricadora de Pecas -42.33
Corporacion Financiera del Valle -43.28
Companhia Metalurgica Barbara (Brazil) -57.92
Mesbla (Brazil) -79.43
</TABLE>
Percent change reflects the increase or decrease in the market price of equity
securities held for the entire period. The actual gain or loss on the fund's
holdings in these securities may differ from these percentages as a result of
purchases and sales during the period.
[End Side Bar]
Cavallo, the architect of Argentina's economic reforms, appears to be mending
fences with Peronist Party legislators. This has reduced political pressure for
the finance minister's removal and reassured foreign investors that Cavallo
will stay in office. Argentina and Brazil also have continued their
privatization programs. Mexico showed its resolve by raising sales taxes to pay
its debts despite the weakened economy. This has helped dampen fears that
Mexico would default on its debts.
The nations of Latin America, and the fund itself, also benefited as U.S.
interest rates fell. For countries that sell bonds collateralized by U.S.
Treasury bonds, lower U.S. interest rates provided a direct benefit in the form
of lower borrowing costs.
The fund took advantage of falling rates and increased the fixed-income portion
of its portfolio to 9.9% at the end of the calendar year from 5.7% at the end
of June. This shift toward bonds contributed to the gains the fund made in the
period.
As the first half of our fiscal year ended, there were some hopeful signs that
the worst of the economic downturn was over. Mexico announced it finished the
calendar year with a small budget surplus. Additionally, Mexico generated an $8
billion trade surplus after an $18 billion deficit in 1994, and has also made
scheduled payments on the $20 billion it borrowed from the U.S. following the
peso's devaluation.
At the end of the half-year, equity investment in Mexico represented 25.9% of
the portfolio's assets, up slightly from 22.9% on June 30. We continued our
investments in Mexican companies that have shown an ability to manage during
past crises. These companies, which include Grupo Carso, Kimberly-Clark de
Mexico, Grupo Televisa and CEMEX, have emerged from past crises stronger and
more profitable.
We continue to maintain our largest equity holdings in Brazil, now representing
30.7% of the fund's portfolio compared with 29.7% on June 30. We believe that
the Real plan, the anti-inflation policy initiated by Brazilian President
Fernando Henrique Cardoso, has survived its first major test. The country can
now look forward to lower inflation. With the Cardoso administration pressing
ahead with plans to privatize electric distribution and mining, we have
concentrated our holdings in utility stocks.
The portion of the fund's equity assets invested in Argentina was stable,
ending the
[Side Bar]
How the Fund's Invested Position Has Changed
Market Value
of Holdings
Percent of Net Assets 12/31/95
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
12/31/93 12/31/94 12/31/95 (in thousands)
Argentina 5.21% 14.20% 14.26% $33,207
Brazil 36.38 34.99 32.65 76,002
Chile 10.62 10.52 5.54 12,892
Colombia 1.51 2.42 1.61 3,738
Ecuador - .77 1.73 4,013
Mexico 40.38 27.71 27.12 63,151
Panama - .17 1.63 3,796
Peru .34 3.01 4.54 10,586
Philippines .78 .69 .84 1,960
Portugal .23 .39 .41 960
U.S. .17 .11 .17 397
Uruguay - .58 .73 1,696
Venezuela .34 .49 .31 725
Other 2.01 .60 .29 680
Cash & Equivalents 2.03 3.35 8.17 19,028
Total 100.00% 100.00% 100.00% $232,831
</TABLE>
[End Side Bar]
six months at 12.3% of assets compared with 12.5% at the end of the last fiscal
year. The Argentine market was the only major Latin American market to register
a gain in 1995 and rallied strongly in the final three months. We took
advantage of the rally to sell some stocks and bonds.
The fund's investment in Chile dropped somewhat in the latest six months, going
from 10.7% of the portfolio on June 30 to 5.5% at the end of the calendar year.
The high prices of most Chilean stocks make it difficult to find compelling
investment values there. The positions of Colombia and Peru in the fund's
portfolio changed little in the six months.
Some of the smaller markets in the region, such as Ecuador and Panama, may
offer good opportunities in the future. For now, their equity markets are small
and do not offer a wide variety of investment choices. However, we have added
to our holdings in Brady bonds, which we believe offer equity-like returns from
these countries.
This has been an important period for the fund. In December, following a
liquidation request from one of the fund's largest shareholders, the Board of
Trustees approved merging the fund's assets into the Emerging Markets Growth
Fund. If New World Investment Fund shareholders approve the merger, all
shareholders should receive shares of Emerging Markets Growth Fund in the
spring. We will keep you informed as the merger progresses.
We look forward to reporting to you again soon.
Sincerely,
Nancy Englander
Chairman of the Board
David Fisher
President
February 9, 1996
All market indexes cited are unmanaged. Source (except for S&P 500): Morgan
Stanley Capital International Perspective.
Here are the total returns and average annual compound returns with all
distributions reinvested for periods ended December 31, 1995: Since inception
on 5/26/89: +307.48%, or +23.72% a year; 5 years: +212.16%, or +25.57% a year;
12 months: -14.21%.
The figures in this report reflect past results. Share price and return will
vary, so you may lose money by investing in the fund. The shorter the time
period of your investment, the greater the possibility of loss. Fund shares are
not deposits or obligations of, or insured or guaranteed by, the U.S.
government, any financial institution, the Federal Deposit Insurance
Corporation, or any other agency, entity or person.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
NEW WORLD INVESTMENT FUND
Investment Portfolio - December 31, 1995 (Unaudited)
Equity-Type Securities
------------------------------------
INDUSTRY DIVERSIFICATION Common Preferred Stocks Convertible Bonds Percent of Net Assets
Stocks Bonds
- ----------------------------------- --------------------------------------------------------- __________________________
Telecommunications 10.10% 10.75% - 0.25% 21.10%
Building Materials & Components 7.35 1.05 1.09% - 9.49
Utilities: Electric & Gas 5.52 3.05 - 0.43 8.79
Banking 4.14 0.84 1.77 - 6.75
Beverages & Tobacco 2.90 1.38 - - 4.28
Metals: Steel 1.98 1.57 0.10 0.43 4.08
Appliances & Household Durables .24 3.52 - - 3.76
Other Industries 18.43 6.10 - 9.05 33.58
------------- ----------- ----------- --------- -----------
50.66% 28.26% 2.96% 9.95% 91.83
====== ====== ===== =====
Short-Term Securities 8.06
Excess of cash and receivables over 0.11
liabilities -----------
Net Assets 100.00%
=======
</TABLE>
*******
<TABLE>
<CAPTION>
<S> <C> <C>
NEW WORLD INVESTMENT FUND
TEN LARGEST EQUITY HOLDINGS Percent of Net Assets Market Value of Holdings
12/31/95 (in thousands)
- -------------------------------------------------------------------------------------
Telecomunicacoes Brasileiras 9.08% $21,149
Telefonos de Mexico 4.09 9,516
CEMEX 3.96 9,230
Brasmoter 3.52 8,198
Telefonica de Argentina 2.96 6,901
Panamerican Beverage 2.81 6,531
Kimberly-Clark de Mexico 2.22 5,171
Apasco 2.15 5,003
Cifra 2.09 4,871
Grupo Financiero Banamex Accival 2.08 4,853
----- -------
34.96% $81,423
===== =======
</TABLE>
NEW WORLD INVESTMENT FUND
Investment Portfolio - December 31, 1995
<TABLE>
<CAPTION>
<S> <C> <C> <C>
EQUITY-TYPE SECURITIES Number of Shares Market Value Percent of
(common and preferred stocks and convertible debentures) or Principal Amount (000) Net Assets
- ----------------------------------------------------------- ------------------ ------- ----------------
Argentina - 12.34%
Astra Compania Argentina de Petroleo SA 1,386,000 $2,564 1.10%
Banco de Galicia y Buenos Aires SA, Class B
(American Depositary Receipts) 4,956 102
Banco de Galicia y Buenos Aires SA .88
7.00% convertible bond August 1, 2002 $2,100,000 1,942
Banco del Sud, Class B 116,950 871 .37
Banco Frances del Rio de la Plata SA
(American Depositary Receipts) 135,700 3,647 1.57
BI SA (acquired 10/31/94, cost: $3,000,000)(1) 3,000,000 3,000 1.29
Hidroneuquen SA
(acquired 11/12/93, cost: $2,437,000) (1) (2) 2,436,763 2,437 1.05
IRSA Inversiones y Representaciones SA
(Global Depositary Receipts) 33,179 846 .36
Molinos Rio de la Plata, Class B 29,482 242 .10
Nortel Inversora SA, Class A, preferred (American
Depository Receipts)(acquired 11/24/92, cost: $1,503,000) (1) 211,560 2,272 .98
Siderca SA Industrial y Comercial 1,496,888 1,452 .62
Sociedad Comercial del Plata SA 133,000 352
Sociedad Comercial del Plata SA (American Depositary .23
Receipts) (acquired 4/28/95, cost: $147,000) (1)(2) 6,700 178
Telecom Argentina STET-France Telecom SA, Class B 295,500 1,395
Telecom Argentina STET-France Telecom SA, Class B .83
(American Depositary Shares) 11,000 524
Telefonica de Argentina SA, Class B 910,000 2,457
Telefonica de Argentina SA, Class B 2.96
(American Depositary Shares) 163,100 4,444
------ -----
28,725 12.34
------ -----
Brazil - 30.66%
Banco Bradesco SA, preferred nominative 30,395,253 266
Banco Bradesco SA, preferred nominative .11
rights, expire January 31, 1996 (2) 710,702 1
Brasmotor SA, preferred nominative 41,276,787 8,198 3.52
Centrais Eletricas Brasileiras SA, Class B,
preferred nominative(American Depositary Receipts) 59,799 807
Centrais Eletricas Brasileiras SA, ordinary nominative 1,632,000 442
Centrais Eletricas Brasileiras SA, ordinary nominative .93
(American Depositary Receipts) 67,219 907
CESP-Companhia Energetica de Sao Paulo,
preferred nominative(American Depositary Receipts) (2) 239,678 1,977
CESP-Companhia Energetica de Sao Paulo,
CESP-Companhia Energetica de Sao Paulo,
preferred nominative(American Depositary Receipts) 1.03
(acquired 8/30/94, cost: $711,000) (1) (2) 42,112 347
CESP-Companhia Energetica de Sao Paulo,
ordinary nominative (2) 3,000,000 68
COFAP-Companhia Fabricadora de Pecas,
preferred noiminative 99,019 489 .21
Companhia Cervejaria Brahma, preferred nominative 7,810,421 3,215 1.38
Companhia Cimento Portland Itau, preferred nominative 9,555,000 2,281 .98
COTEMINAS-Companhia de Tecidos Norte de Minas-COTEMINAS
preferred nominative 5,835,000 1,952 .84
Companhia Energetica de Minas Gerais-CEMIG,
preferred nominative(American Depositary Receipts) (2) 117,586 2,572
Companhia Energetica de Minas Gerais-CEMIG,
preferred nominative(American Depositary Receipts) 1.70
(acquired 9/22/94, cost: $1,616,000) (1) (2) 63,583 1,391
Companhia Metalurgica Barbara, preferred nominative (2) 558,795,763 161 .07
Companhia Siderurgica Belgo-Mineira,
preferred nominative 11,881,518 666 .29
Companhia Vale do Rio Doce, preferred nominative
(American Depositary Receipts) 73,066 2,977 1.28
Dixie-TOGA, preferred nominative, receipts (2) 1,390,000 1,216 .52
GP Capital Partners, LP
(acquired 1/28/94, cost: $3,000,000) (1) (2) (3) 3,000 3,000 1.29
Industrias Klabin de Papel e Celulose SA,
preferred nominative(American Depositary Receipts) 202,885 1,750 .75
Lojas Americanas SA, preferred nominative 51,798,049 1,215
Lojas Americanas SA, ordinary nominative 19,233,600 420
Lojas Americanas SA, preferred nominative, .86
warrants, expire May 3, 1996 (2) 531,552 366
Lojas Arapua, preferred nominative (Global Depositary
Receipts) (2) 104,000 780 .34
Mecanica Pesada, preferred nominative 190,000 782
Mecanica Pesada, ordinary nominative 70,000 490 .55
Mesbla SA, preferred nominative (2) 32,349,795 401 .17
Osa, preferred nominative 90,000,000 695 .30
Petrobras Distribuidora SA-BR, preferred nominative 111,542,000 2,985 1.28
Rhodia-Ster SA (Global Depositary Receipts) 113,100 990 .43
Sadia Concordia SA Industria e Comercio,
preferred nominative 1,163,000 862 .37
Telecomunicacoes Brasileiras SA, preferred nominative 552,090 27
Telecomunicacoes Brasileiras SA, preferred nominative 9.08
(American Depositary Receipts) 445,837 21,122
Telecomunicacoes de Minas Gerais SA,ordinary nominative 4,748,000 244 .10
Telecomunicacoes de Sao Paulo SA-Telesp,
preferred nominative 26,497,114 3,899
Telecomunicacoes de Sao Paulo SA-Telesp, 1.83
ordinary nominative 2,554,000 369
Vidrararia Santa Marina, ordinary nominative 308,700 1,048 .45
------ -----
71,378 30.66
------ -----
Chile - 5.54%
Banmedica SA 2,362,500 $879 .38%
CAP SA 247,599 1,070 .46
Chilgener SA (American Depositary Receipts) 38,778 969 .42
Compania Tecno Industrial SA 9,720,000 563 .24
Empresa Nacional de Electricidad SA
(American Depositary Receipts) 135,409 3,081 1.32
Enersis Spon (American Depositary Receipts) 143,000 4,075 1.75
Forestal Terranova 247,599 351 .15
Invercap SA 360,599 542 .23
Sociedad Quimica y Minera de Chile SA, Class A 286,600 1,362 .59
------ ----
12,892 5.54
------ ----
Colombia - 1.36%
Banco de Colombia SA (Global Depositary Receipts) 65,000 325
Banco de Colombia SA 5.20% convertible bond .69
February 1, 1999(acquired 1/27/94, cost: $1,975,000) (1) $1,700,000 1,275
Cementos Diamante, SA 68,970 320 .14
Cementos Paz del Rio (American Depositary Receipts)
(acquired 9/21/94, cost: $1,498,000) (1) (2) 86,000 1,247 .53
Corporacion Financiera del Valle SA, Class B (American
Depositary Receipts) (acquired 2/4/93, cost $0) (1) 18 - -
------ -----
3,167 1.36
------ -----
La Cemento Nacional CA (Global Depositary Receipts) 9,824 1,670 .72
------ -----
Mexico - 25.90%
Apasco, SA de CV 1,215,976 5,003 2.15
Bufete Industrial, SA, ordinary participation certificates
(American Depositary Receipts) (2) 105,000 1,575 .68
CEMEX, SA, Class A 67,500 224
CEMEX, SA, Class B 1,003,100 3,657
CEMEX, SA, Class B, 4.25% convertible bond, 3.96
November 1, 1997(aquired 9/28/94, cost: $3,016,000) (1) $3,000,000 2,535
CEMEX, SA, ordinary participation certificates 847,552 2,814
Cifra, SA de CV, Class B 3,028,930 3,163
Cifra, SA de CV, Class C 1,682,142 1,708 2.09
Corporacion Geo, SA de CV, Class B
(acquired 8/29/95, cost: $1,245,000) (1) 350,300 1,035 .44
Embotelladores del Valle de Anahuac, SA de CV, Class B 243,100 222 .10
Grupo Carso, SA de CV, Class A1 589,900 3,195 1.37
Grupo Casa Autrey, SA de CV
(American Depositary Receipts) 24,500 328 .14
Grupo Financiero Banamex Accival, SA de CV, Class B 2,268,300 3,816
Grupo Financiero Banamex Accival, SA de CV, Class L 590,360 881
Grupo Financiero Banamex Accival, SA de CV, 2.08
7.00% convertible debentures December 15, 1999 $194,000 156
Grupo Financerio Bancomer, SA de CV, Class L
57.46% convertible debentures May 16, 2002 (4) MXP5,750,000 $756 .32%
Grupo Financiero Banorte, SA de CV, Class B 1,222,094 1,143 .49
Grupo Televisa, SA, ordinary participation certificates 106,000 1,256
Grupo Televisa, SA, ordinary participation certificates 1.23
(American Depositary Receipts) 71,000 1,598
Internacional de Ceramica, SA de CV, Class B (2) 55,200 68
Internacional de Ceramica, SA de CV .43
(American Depositary Receipts) (2) 170,400 937
Kimberly-Clark de Mexico, SA de CV, Class A 275,000 4,168
Kimberly-Clark de Mexico, SA de CV, Class B 70,000 1,003 2.22
Panamerican Beverages, Inc., Class A 204,100 6,531 2.81
Sigma Alimentos, SA de CV, Class B 110,000 702 .30
Telefonos de Mexico, SA de CV, Class A 1,650,000 2,664
Telefonos de Mexico, SA de CV, Class L 2,475,000 3,983
Telefonos de Mexico, SA de CV, Class L 4.09
(American Depositary Receipts) 90,000 2,869
Tubos de Acero de Mexico, SA (2) 151,000 1,107
Tubos de Acero de Mexico, SA
(American Depositary Receipts) (2) 141,200 989
Tubos de Acero de Mexico, SA 1.00
7.50% convertible Eurobond, June 12, 1997 $250,000 226
------ ------
60,312 25.90
------ ------
Peru - 2.61%
Cemento Norte Pacasmayo SA, Class C 234,952 449 .19
Credicorp Ltd. (2) 275,920 4,760 2.04
Ontario-Quinta AVV (acquired 8/15/94, cost: $900,000) (1) 877,083 877 .38
------ -----
6,086 2.61
------ -----
Philippines - 0.84%
Ayala Land, Inc., Class B 843,750 1,030 .44
Philippine Long Distance Telephone Co. (Global Depositary
Receipts) 30,000 930 .40
------ -----
1,960 .84
------ -----
Portugal - 0.41%
Portugal Telecom, SA (American Depository Receipts) 50,500 960 .41
------ -----
United States - 0.17%
Atlantic Tele-Network, Inc. (2) 36,700 397 .17
------ -----
Uruguay - 0.73%
Banco Comercial Portugues, SA (Global Depositary Receipts)
Receipts) 115,000 1,696 .73
------ -----
Venezuela - 0.31%
Compania de Inmuebles y Valores Caracas (2) 20,494,000 - -
Fabrica Nacional de Cementos SACA 4,098,800 $301 .13%
Venezolana de Cementos, SACA, Class A 193,800 238
Venezolana de Cementos, SACA, Class B 173,094 186 .18
------ -----
725 .31
------ -----
Miscellaneous - 0.29%
Stocks in initial period of acquisition 2,439,000 680 .29
------ ------
TOTAL EQUITY-TYPE SECURITIES(cost: $150,632,000) 190,648 81.88
------ ------
Principal Amount
(000)
BONDS AND NOTES
- ----------------------------------------------------------- ------------------ ------- -----------------
Argentina - 1.92%
Republic of Argentina Bocon PIK 4.57% April 1, 2001 (4) ARP750 408 .18
Republic of Argentina Eurobond Series L 6.8125%
March 31, 2005 (4) $3,000 2,138 .92
Republic of Argentina Par Eurobond Series L 5.00%
March 31, 2003 (4) 2,500 1,431 .60
Bridas Corporation SR 12.50% November 15, 1999 250 250 .11
Central Puerto SA 10.75% Eurobond November 2, 1997 250 255 .11
------ ----
4,482 1.92
------ ----
Brazil - 1.99%
Abril SA 12.00% October 25, 2003
(acquired 10/17/95, cost: $250,000) (1) 250 252 .11
Federal Republic of Brazil Capitalization Bond PIK 8.00%
April 15, 2014 2,918 1,667 .72
Federal Republic of Brazil Debt Conversion Bond Series L
6.875% April 15, 2012 (4) 3,250 1,865 .80
Republic of Minas Gerais Series A 7.875%
Feburary 10, 1999 1,000 840 .36
------ ------
4,624 1.99
------ ------
Colombia - 0.25%
Comunicacion Celular SA 0%/13.125% November 15, 2003
(acquired 11/17/95, cost: $548,000) (1)(5) 1,000 571 .25
------ ------
Ecuador - 1.01%
Republic of Ecuador Discount Bonds 6.8125%
February 28, 2025 (4) 1,750 888 .38
Republic of Ecuador Past Due Interest Bonds 6.8125%
February 28, 2015 (4) 4,341 1,455 .63
------ ------
2,343 1.01
------ ------
Mexico - 1.22%
Banco Nacional de Comercio Exterior International Finance
7.25% February 02, 2004 $500 $387 .17%
Ispat Mexicana, SA de CV 10.375%
Senior Notes due March 15, 2001 250 229 .10
MC-Cuernavaca Toll Road Trust 9.25% July 25, 2001
(acquired 05/15/95, cost: $576,000) (1) 763 522 .22
Tubos de Acero de Mexico 13.75% December 8, 1999
(acquired 11/23/94, cost: $990,000) (1) 1,000 1,013 .43
United Mexican States Discount Bond Series A 6.766%
December 31, 2019 (4) 250 180
United Mexican States Discount Bond Series B 6.766% .16
December 31, 2019 (4) 250 180
United Mexican States Eurobond Series B 6.25%
December 31, 2019 500 328 .14
------ -----
2,839 1.22
------ -----
Panama - 1.63%
Republic of Panama/Agent-Bank of America NTSA/
Loan Participation Agreements (Participation-
Citibank, NA) (2)(4)(6)(7) 6,918 2,916 1.25
Republic of Panama/Agent-Bank of America NTSA/
Loan Participation Agreements(Participation-Morgan
Guaranty Trust, NA) (2)(4)(6)(7) 425 180 .08
Republic of Panama/Agent-Lloyds Bank International
Limited/Loan Participation Agreements
(Participation-Chase Manhattan Bank, NA) (2)(4)(6)(7) 875 360 .15
Republic of Panama Interest Reduction Bond
3.50% December 29, 2049 (2)(4)(6)(7) 750 340 .15
------ ------
3,796 1.63
------ ------
Peru - 1.93%
Republic of Peru/Agent-Bankers Trust Company/
Loan Participation Agreements (Participation-
Citibank, N.A.) (2)(4)(6)(7) 975 342 .15
Republic of Peru/Agent-Citibank, N.A./Loan Participation
Agreements (Participation-Citibank, N.A.) (2)(4)(6)(7) 2,583 900 .38
Republic of Peru/Agent-Citibank, N.A./Loan Participation
Agreements (Participation-Morgan Guaranty Trust) (2)(4)(6)(7) 2,661 936 .40
Republic of Peru/Agent-Citibank, N.A./Loan Participation
Agreements (Participation-Salomon Brothers Inc.) (2)(4)(6)(7) 1,851 648 .28
Republic of Peru/Agent-Wells Fargo Bank/Loan Participation
Agreements (Participation-Citibank, N.A.) (2)(4)(6)(7) 820 288 .12
Republic of Peru/Agent-Wells Fargo Bank/Loan Participation
Agreements (Participation-Morgan Guaranty Trust) (2)(4)(6)(7) 3,407 1,206 .52
Republic of Peru/Agent-Wells Fargo Bank, N.A./Loan
Participation Agreements (Participation-
J.P. Morgan) (2)(4)(6)(7) 506 180 .08
------ -----
4,500 1.93
------ -----
TOTAL BONDS AND NOTES(cost: $19,948,000) 23,155 9.95
------ -----
SHORT-TERM SECURITIES
Corporate Short-Term Notes - 0.62%
Deutsche Bank Financial Inc. 5.76% due 01/05/96 4,700 4,696 2.02
British Gas Capital Inc. 5.72% due 01/08/96 6,600 6,591 2.83
Glaxo Wellcome PLC 5.58% due 03/11/96 1,000 989 .42
------ -----
12,276 5.27
------ -----
Non-U.S. Government Short-Term Obligations - 0.29%
Certificados De La Tesoreria due 01/18/96 MXP125 160 .07
Hidroelectrica Piedra Del Aguila, S.A. 15.00% due 11/27/96
(acquired 12/27/95, cost: $498,000) (1) $500 500 .22
------ -----
660 .29
Non-U.S. Corporation Short-Term Obligations - 0.04%
Mesbla SA, Series 2, 13.25% due 11/1/96 R$10,270 103 .04
------ -----
Federal Agency Discount Notes - 0.51%
Federal Home Loan Bank 5.54% due 02/07/96 $1,200 1,193 .51
------ -----
Non-U.S. Currency - 1.95%
Chilean peso CHP1,843,955 4,542 1.95
------ -----
TOTAL SHORT-TERM SECURITIES(cost: $20,053,000) 18,774 8.06
------ -----
TOTAL INVESTMENT SECURITIES (cost: $190,633,000) 232,577 99.89
Excess of cash and receivables over liabilities 254 .11
-------- ----------
NET ASSETS $232,831 100.00%
======== ==========
</TABLE>
(1) Purchased in a private placement transaction; resale to the public may
require registration and no
right to demand registration under U.S. law exists. As of December 31, 1995,
the total market value and
cost of such securities was $22,452,000 and $23,910,000 respectively, and the
market value represented
9.64% of net assets.
(2) Non-income-producing securities.
(3) Unfunded capital commitments represent binding commitments made by the fund
which may be paid in the future.
(4) Coupon rate may change periodically.
(5) Represents a zero-coupon bond which will convert to an interest-bearing
security at a later date.
(6) Security is currently in default.
(7) Participation interests were acquired through the financial institution
indicated parenthetically.
Non-U.S. currency symbols:
ARP - Argentine peso
R$ - Brazilian real
CHP - Chilean peso
MXP - Mexican peso
See Notes to Financial Statements
NEW WORLD INVESTMENT FUND
Equity - type securities added to the portfolio since June 30, 1995
- ---------------------------------------------------------------------
Banco del Sud
Corporacion Geo
Dixie-TOGA,
Enersis
Lojas Arapua
Molinos Rio de la Plata
Siderca
Equity - type securities eliminated from the portfolio since June 30, 1995
- ------------------------------------------------------------------------
Aracruz Celulose
Banco de Credito del Peru*
Bca Quadrum
Compania Cervecerias Unidas
Compania de Telecomunicaciones de Chile
Corticeira Amorim-Sociedad Gestora de
Participacoes Socais
Ericsson do Brazil Comercio e Industria
Gruma
Philippine National Bank
Tolmex
YPF
*Banco de Creditodel Peru shares were exchanged for holding in Credicorp Ltd.
NEW WORLD INVESTMENT FUND
FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF ASSETS AND LIABILITIES AT DECEMBER 31, 1995 (DOLLARS IN THOUSANDS) (UNAUDITED)
Assets:
Investment securities at market (cost: $190,633)
$232,577
Cash 148
Receivables for--
Sales of investments $2,669
Dividends and accrued interest 1,582 4,251
------- -------
236,976
Liabilities: -------
Non-U.S. taxes payable 1,360
Payables for--
Purchases of investments 924
Unfunded capital commitments 1,531
Management services 175
Accrued expenses 155 2,785
------- -------
4,145
-------
Net Assets at December 31, 1995 --
Equivalent to $19.08 per share on
12,205,648 shares of beneficial interest
issued and outstanding, par value $0.001
per share; unlimited shares authorized $232,831
========
STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED DECEMBER 31, 1995 (DOLLARS IN THOUSANDS)(UNAUDITED)
Investment Income:
Income:
Dividends $1,723
Interest 2,248 $3,971
-------
Expenses:
Management services fee 1,117
Custodian fee 155
Auditing and legal fees 43
Reports to shareholders 3
Registration statement and prospectus 26
Taxes other than federal
Income tax 1
Other expenses 75 1,420
------- -------
Income before non-U.S. taxes 2,551
Non-U.S. taxes (150)
Net investment income 2,401
-------
Realized Gain and Unrealized Appreciation on
Investments:
Realized gain before non-U.S. taxes 3,043
Non-U.S. taxes (190)
-------
Net realized gain 2,853
Net change in unrealized appreciation:
Beginning of period 41,534
End of period 41,832
-------
Net unrealized appreciation 298
Decrease in unrealized Non-U.S. taxes 674 972
------- -------
Net realized gain and unrealized appreciation
on investments 3,825
-------
Net Increase in Net Assets Resulting from Operations
6,226
=======
STATEMENT OF CHANGES IN NET ASSETS (DOLLARS IN THOUSANDS)
- ----------------------------------------------------------------------------------------------------
Six Months Ended Year Ended
December 31,1995* June 30,1995
----------------------------------
Operations:
Net investment income $2,401 $4,566
Net realized gain on investments 2,853 48,589
Net unrealized appreciation (depreciation)on investments
972 (94,235)
------- --------
Net increase (decrease) in net assets resulting from operations
6,226 (41,080)
------- --------
Dividends and Distributions Paid to Shareholders:
Dividends from net investment income - (366)
Distributions from net realized gain on investments
(6,979) (89,986)
------- --------
Total dividends and distributions (6,979) (90,352)
------- --------
Capital Share Transactions:
Proceeds from shares issued in reinvestment of net investment income dividends and
distributions of net realized gain on investments: 377,428 and 3,415,584 shares,
respectively
6,979 90,342
Cost of shares repurchased: 760,273 and 595,821 shares, respectively
(15,839) (21,892)
-------- --------
Net increase (decrease) in net assets resulting from capital share transactions
(8,860) 68,450
-------- --------
Total Decrease in Net Assets (9,613) (62,982)
Net Assets:
Beginning of period 242,444 305,426
-------- --------
End of period (including excess of distributions net investments income:
$1,403 and $3,784,respectively)
$232,831 $242,444
======== ========
</TABLE>
*Unaudited
See Notes to Financial Statements
Notes to Financial Statements
1. New World Investment Fund (the "fund") is registered under the Investment
Company Act of 1940 as a closed-end, nondiversified management investment
company. The following paragraphs summarize the significant accounting policies
consistently followed by the fund in the preparation of its financial
statements:
Equity-type securities traded on a national securities exchange (or
reported on the NASDAQ national market) and securities traded in the
over-the-counter market are stated at the last reported sales price on the day
of valuation; other securities, and securities for which no sale was reported
on that date, are stated at the last quoted bid price. In cases where
securities are traded on more than one exchange, the securities are valued on
the exchange designated by or under the authority of the Board of Trustees as
the primary market. Bonds and notes are valued at prices obtained from a
bond-pricing service provided by a major dealer in bonds, when such prices are
available; however, in circumstances where the investment adviser deems it
appropriate to do so, such securities will be valued at the mean of their
representative quoted bid and asked prices or, if such prices are not
available, prices for securities of comparable maturity, quality, and type.
Short-term securities with original or remaining maturities in excess of 60
days are valued at the mean of their quoted bid and asked prices. Short-term
securities with 60 days or less to maturity are amortized to maturity based on
their cost to the fund if acquired within 60 days of maturity or, if already
held by the fund on the 60th day, based on the value determined on the 61st
day. Securities for which market quotations are not readily available
(including restricted securities which are subject to limitations as to their
sale), or which are not deemed to represent market value, are valued at fair
value as determined in good faith by the Valuation Committee of the Board of
Trustees.
As is customary in the mutual fund industry, securities transactions are
accounted for on the date the securities are purchased or sold. Realized gains
and losses from securities transactions are reported on an identified cost
basis. Dividend and interest income is reported on the accrual basis. Discounts
on securities purchased are amortized over the life of the respective
securities. The fund does not amortize premiums on securities purchased.
Dividends and distributions paid to shareholders are recorded on the
ex-dividend date.
Investment securities, cash balances, and other assets and liabilities
denominated in non-U.S. currencies are recorded in the financial statements
after translation into U.S. dollars utilizing rates of exchange on the last
business day of the period. Purchases and sales of investment securities,
dividend and interest income, and certain expenses are calculated at the rates
of exchange prevailing on the respective dates of such transactions.
Gains and losses that arise from changes in exchange rates are not segregated
from gains and losses that arise from changes in market prices of investments.
Unfunded capital commitments represent agreements which obligate the fund to
meet capital calls in the future. Payment would be made when a capital call is
requested. Capital calls can only be made if and when certain requirements have
been fulfilled; thus, the timing of such capital calls cannot be readily
determined. Unfunded capital commitments are recorded at the amount that would
be paid when and if capital calls are made.
Pursuant to the custodian agreement, the fund receives credits against its
custodian fee for imputed interest on certain balances with the custodian bank.
The custodian fee of $155,000 includes $2,500 that was paid by these credits
rather than in cash.
2. Investing in securities of issuers in a variety of developing countries
involves certain special investment risks, which may include investment and
repatriation restrictions, currency volatility, government involvement in the
private sector, limited investor information, shallow securities markets,
certain local tax law considerations, and limited regulation of the securities
markets.
Dividend income, and interest income, net realized gain, and net
unrealized gain of the fund derived in Chile are subject to certain non-U.S.
taxes at rates of 20% and 35%, respectively. The fund provides for such
non-U.S. taxes on investment income, net realized gain, and net unrealized
gain.
3. It is the fund's policy to continue to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its net taxable income, including any net realized gain on
investments, to its shareholders. Therefore, no federal income tax provision is
required.
As of December 31, 1995, net unrealized appreciation on investments for
book and federal income tax purposes aggregated $41,273,000, net of
accumulated deferred taxes totaling $671,000 on net unrealized appreciation of
Chilean securities, of which $68,796,000 related to appreciated securities and
$27,523,000 related to depreciated securities. There was no difference between
book and tax realized gains on securities transactions for the six months ended
December 31, 1995. The cost of portfolio securities for book and federal income
tax purposes was $190,633,000 at December 31, 1995.
4. The fee of $1,117,000 for management services was paid pursuant to an
agreement with Capital International, Inc. (CII), with which certain officers
and Trustees of the fund are affiliated. The Investment Advisory and Service
Agreement provides for monthly fees, accrued weekly, based on an annual rate of
0.90% on the first $400 million of the fund's net assets, plus 0.80% of such
assets in excess of $400 million. CII is owned by Capital Group International,
Inc., which is a wholly owned subsidiary of The Capital Group Companies, Inc.
5. As of December 31, 1995, accumulated undistributed net realized gain on
investments was $1,032,000 and additional paid-in capital was $192,029,000. The
fund made purchases and sales of investment securities, excluding short-term
securities, of $36,095,000 and $44,766,000, respectively, during the six months
ended December 31, 1995.
Dividend and interest income is recorded net of non-U.S. taxes paid. For
the six months ended December 31, 1995, such non-U.S. taxes were $152,000. Net
realized currency losses on dividends, interest, withholding taxes reclaimable,
and sales of non-U.S. bonds and notes were $3,000 for the six months ended
December 31, 1995.
NEW WORLD INVESTMENT FUND
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
PER-SHARE DATA AND RATIOS
Year ended June 30
Six Months Ended -----------------------------------
December 31, 1995(1) 1995 1994 1993 1992
--------------------- -----------------------------------
Net Asset Value, Beginning of Period $19.26 $31.27 $24.89 $20.98 $17.79
------- ------- ------- ------- -------
Income from Investment Operations:
Net investment income 0.19 .43 .50 .37 .41
Net realized and unrealized gains
(losses) on investments before
non-U.S. taxes 0.27 (2.49) 8.83 5.59 4.38
Non-U.S. taxes (0.05) (.10) (.50) (.01) (.20)
------- ------- ------- ------- -------
Total income (loss) from investment
operations .41 (2.16) 8.83 5.95 4.59
------- ------- ------- ------- -------
Less Distributions:
Dividends from net investment
income - (.04) (.21) - (.46)
Distributions from net realized
gains
(.59) (9.81) (2.24) (2.04) (.94)
------- ------- ------- ------- -------
Total distributions (.59) (9.85) (2.45) (2.04) (1.40)
------- ------- ------- ------- -------
Net Asset Value, End of Period 19.08 19.26 31.27 24.89 20.98
======= ======= ======= ======= =======
Total Return 2.23% (2) (15.47%) 35.97% 31.28% 26.57%
Ratios/Supplemental Data:
Net assets, end of period
(in millions)
$233 $242 $305 $212 $180
Ratio of expenses to average
net assets 0.60% (2) 1.27% 1.36% 1.40% 1.53%
Ratio of expenses and non-U.S.
taxes to average net assets 0.67% (2) 1.40% 1.50% 1.62% 1.71%
Ratio of net income to average
net assets 1.02% (2) 1.58% 1.43% 1.70% 1.92%
Portfolio turnover rate 16.54% (2) 44.19% 21.47% 17.23% 21.66%
</TABLE>
1 Unaudited
2 These ratios are based on operations for the period shown and, accordingly,
are not representative of
a full year's operations.
NEW WORLD INVESTMENT FUND
BOARD OF TRUSTEES
Nancy Englander, Los Angeles, California
Chairman of the Board of the fund
Senior Vice President,
Capital International, Inc.
David I. Fisher, Los Angeles, California
President of the fund
Chairman of the Board,
The Capital Group Companies, Inc.
Marinus W. Keijzer, Zeist, Netherlands
Chief Economist and Strategist, Pensioenfonds PGGM
Hugh G. Lynch, New York, New York
Managing Director, International Investments,
General Motors Investment Management Corporation
Teresa E. Martini, Berkeley Heights, New Jersey
Vice President, Public Equities
AT&T Investment Management Corporation
James K. Peterson, Stamford, Connecticut
Director of Investment Management,
IBM Corporation
OTHER OFFICERS
Midori Aoki, New York, New York
Vice President of the fund
Vice President, Capital International, Inc.
Roberta A. Conroy, Los Angeles, California
Vice President and Secretary of the fund
Assistant General Counsel,
The Capital Group Companies, Inc.
Steven N. Kearsley, Brea, California
Vice President of the fund
Vice President and Treasurer,
Capital Research and Management Company
Victor D. Kohn, Los Angeles, California
Vice President of the fund
Executive Vice President,
Capital Research International, Inc.
Robert W. Lovelace, Los Angeles, California
Vice President of the fund
Vice President, Capital International, Inc.
Shaw B. Wagener, Los Angeles, California
Vice President of the fund
Executive Vice President and Director,
Capital International, Inc.
Michael A. Felix, Brea, California
Treasurer of the fund
Vice President, Capital International, Inc.
Vincent P. Corti, Los Angeles, California
Assistant Secretary of the fund
Vice President-Fund Business Management Group,
Capital Research and Management Company
OFFICES OF THE FUND AND OF THE INVESTMENT ADVISER, CAPITAL INTERNATIONAL, INC.
11100 Santa Monica Boulevard, 15th Floor
Los Angeles, California 90025-3302
135 South State College Boulevard
Brea, California 92621-5804
CUSTODIAN OF ASSETS
The Chase Manhattan Bank, N.A.
One Chase Manhattan Plaza
New York, New York 10081-0001
COUNSEL
Dechert Price & Rhoads
1500 K Street N.W.
Washington, D.C. 20005-1208
This report is for the information of shareholders of New World Investment
Fund, but it may also be used as sales literature when preceded or accompanied
by the current prospectus, which gives details about charges, expenses,
investment objectives and operating policies of the fund.
Printed in USA DT/SOS/2893
(c) 1996 New World Investment Fund
Lit No. NWIF-013-0296 (NLS)
|
|