Lord Abbett
Series Fund, Inc.
Growth and Income Portfolio
Mid-Cap Value Portfolio
International Portfolio
1999 ANNUAL REPORT
[LOGO]
Visit our
Web Site and get:
up-to-date statistics and
other useful information at
www.lordabbett.com
<PAGE>
Report to Shareholders
For the Fiscal Year Ended December 31, 1999
[PHOTO]
Robert S. Dow
Chairman
January 7, 2000
"We were well positioned to benefit from the leader-ship role of the technology
sector, and many of our technology holdings posted strong gains."
[GRAPHIC OMITTED]
Lord, Abbett & Co. is proud to announce we have received a DALBAR award for
providing consistently good service to shareholders, the 1999 Key Honor Award
for Mutual Fund Service. DALBAR, Inc., an independent research firm and
evaluator of mutual fund service, presents the awards to financial services
firms that provide consistently solid service to clients.
The Lord Abbett Series Fund - Growth and Income Portfolio completed its fiscal
year on 12/31/99, providing its shareholders with a total annual return of
16.74%.*
U.S. Equity Market - The Year in Review
Since 1997, low interest rates and a deceleration in corporate earnings have
driven the U.S. stock markets. This environment favored a very select group of
stocks with stable earnings growth - primarily those of large companies.
Investors responded by continuing to purchase stocks of companies that exhibited
solid earnings and/or strong recent stock performance. This trend continued
during the first quarter of 1999, with stocks of large growth companies
continuing to provide the strongest returns. In the second quarter, we saw a
broadening of the market where for the first time in many quarters value stocks
outperformed growth stocks, and stocks of small- and mid-sized companies
outperformed those of large companies. Towards the end of the year, the trend
reversed once again, and growth stocks returned to favor. Global growth rates
continued to surge throughout 1999, instilling inflationary concerns in many
investors. In the fall, the Federal Reserve Board responded with a series of
rate hikes that brought U.S. interest rates up from their 1998 record lows.
How We Positioned Your Portfolio**
In early 1999, we sold some of our holdings in non-cyclical companies such as
healthcare, pharmaceuticals and technology, because they approached what we
believed to be their full values. We then used the proceeds to build or add to
positions in stocks of undervalued cyclical companies in the manufacturing and
commodities industries. When cyclical stocks advanced in April, the Portfolio
benefited from the upswing. However, our holdings in healthcare services
companies held down the Fund's performance a bit, as political issues and
government influence hampered the performance of these companies.
Anticipating continued improvement in the global economy, we made several early
investments in energy companies that benefited the Portfolio. Rising interest
rates in the latter part of the year caused interest rate-sensitive areas, such
as electric utilities and financial services companies, to underperform. Over
the course of the year, the Portfolio remained underweighted in financial
services companies in anticipation of rising interest rates. However, we
maintained a focus on property and casualty insurance companies, as this market
segment is beginning to benefit from industry consolidation.
Stocks of technology companies demonstrated tremendous relative strength
throughout the year despite their high valuations. We were well positioned to
benefit from the leadership role of this sector, and many of our technology
holdings posted strong gains. We also increased our exposure to basic materials
companies (e.g., metals, paper and chemicals) in anticipation of further global
economic recovery in 2000 and beyond.
Watching the Horizon
We expect to see global economic growth continue throughout the coming year. In
response, we are investing in companies that should benefit from this recovery,
such as those producing basic materials and capital goods (e.g., machinery,
computers and industrial equipment). In the U.S., some signs are emerging that
the economy may be moderating, which may diminish the risk of significant future
U.S. interest rate hikes. As a result, we are reconsidering financial services
stocks, many of which display solid fundamentals at attractive prices. We
believe that any possibility of a future interest rate increase is already
reflected in the low stock prices of these companies.
Thank you for your continued confidence in Lord Abbett Series Fund. We look
forward to helping you achieve your financial goals in the future.
* Total return is the percent change in net asset value assuming the
reinvestment of all distributions.
** The Portfolio is actively managed and is subject to change.
1
<PAGE>
Lord Abbett Series Fund - Growth & Income Portfolio
Serving Insurance Companies and Their Clients Since 1989
Consistent Management - W. Thomas Hudson, Partner of Lord Abbett, heads the
Series Fund -- Growth & Income Portfolio management team. Tom has been the lead
manager of the Fund since it was established in 1989.
Consistent Results - Average Annual Return of 16.23%(1) - Lower Volatility - No
Down Years(2)
Growth of $10,000: 12/31/89 - 12/31/99
Average Annual Returns(1)
The Fund's lower volatility helped
investors in 1994
o Lord Abbett Series Fund +2.8%
o Lipper Growth and Income -0.8%
Funds Average
[GRAPHIC OMITTED]
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
12/89 12/90 12/91 12/92 12/93 12/94 12/95 12/96 12/97 12/98 12/99
Value at Year End(3) $10,070 $10,290 $13,069 $15,109 $17,347 $17,826 $23,141 $27,654 $34,361 $38,873 $45,387
Total Returns 0.7% 2.2% 27.0% 15.6% 14.8% 2.8% 29.8% 19.5% 24.4% 12.9% 16.7%
</TABLE>
(1) Reflects the percent change in net asset value for the period 12/11/89
(inception) through 12/31/99 and includes the reinvestment of all
distributions.
(2) For the period 12/11/89 (inception) through 12/31/99, Lord Abbett Series
Fund - Growth and Income Portfolio had no calendar years of negative
performance. The 10-year period above was a period of generally good
performance for the equity markets. During that period, the S&P 500 Index
annualized return was 18.21% in the aggregate, with dividends reinvested.
(3) Value at year end figure represents total account value, assuming the
reinvestment of dividends and capital gains distributions.
The Portfolio and Performance
The Fund has performed well over time relative to the Morningstar Large Value
Funds Category Average.
[GRAPHIC OMITTED]
1 Year 3 Years 5 Years 10 Years
The Portfolio(4) 16.7% 18.0% 20.6% 16.3%
Morningstar Large Value Funds
Category Average(5) 6.6% 14.7% 19.3% 14.0%
(4) Average annual total returns are at NAV that include the reinvestment of
dividends and the effect of deducting an investment options expenses, but
do not include mortality and expense charges, any policy administrative
charges or any deferred sales charges specific to any variable insurance
product. Total returns would be reduced with the inclusion of variable
insurance contract charges.
(5) Source: Morningstar, Inc.
2
<PAGE>
<TABLE>
<CAPTION>
Statement of Net Assets
LORD ABBETT SERIES FUND, INC. - GROWTH AND INCOME PORTFOLIO December 31, 1999
Investments Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Common Stocks 92.40%
- ------------------------------------------------------------------------------------------------------------------------------------
Aerospace/Defense 2.23% Honeywell International Inc. 14,000 $ 807,625
- ------------------------------------------------------------------------------------------------------------------------============
Aluminum 2.29% Alcoa Inc. 10,000 830,000
- ------------------------------------------------------------------------------------------------------------------------============
Automotive .88% Ford Motor Co. 6,000 320,625
- ------------------------------------------------------------------------------------------------------------------------============
Banks: Money Center 1.61% Chase Manhattan Corp. 7,500 582,656
- ------------------------------------------------------------------------------------------------------------------------============
Banks: Regional 4.11% Bank One Corp. 11,000 352,687
Fleet Boston Financial Corp. 14,000 487,375
Wells Fargo Co. 16,000 647,000
Total 1,487,062
- ------------------------------------------------------------------------------------------------------------------------============
Chemicals 3.31% Dow Chemical Co. 5,000 668,125
Rohm and Haas Co. 13,000 528,937
Total 1,197,062
- ------------------------------------------------------------------------------------------------------------------------============
Communications Loral Space & Communications Ltd.* 22,000 534,875
Technology 2.45% QUALCOMM Inc.* 2,000 352,250
Total 887,125
- ------------------------------------------------------------------------------------------------------------------------============
Computer Services 3.69% First Data Corp. 8,000 394,500
Ceridian Corp.* 14,000 301,875
Unisys Corp.* 20,000 638,750
Total 1,335,125
- ------------------------------------------------------------------------------------------------------------------------============
Computer Technology 5.12% Apple Computer Inc.* 2,500 257,031
Compaq Computer Corp. 15,000 405,938
International Business Machines Corp. 6,000 648,000
Sun Microsystems Inc.* 7,000 542,062
Total 1,853,031
- ------------------------------------------------------------------------------------------------------------------------============
Computer: Software 3.69% Cadence Design Systems Inc.* 23,000 552,000
Oracle Corp.* 7,000 784,437
Total 1,336,437
- ------------------------------------------------------------------------------------------------------------------------============
Conglomerates 1.35% Minnesota Mining & Manufacturing Co. 5,000 489,375
- ------------------------------------------------------------------------------------------------------------------------============
Copper 1.76% Phelps Dodge Corp. 9,500 637,687
- ------------------------------------------------------------------------------------------------------------------------============
Drugs 3.24% American Home Products Corp. 16,000 631,000
Pharmacia & Upjohn Inc. 12,000 540,000
Total 1,171,000
- ------------------------------------------------------------------------------------------------------------------------============
Electric Power 4.95% Carolina Power & Light Co. 3,000 91,313
Dominion Resources, Inc. 14,000 549,500
Duke Energy Corp. 13,000 651,625
First Energy Corp. 22,000 499,12
Total 1,791,563
- ------------------------------------------------------------------------------------------------------------------------============
Electrical Equipment 1.43% Emerson Electric Co. 9,000 516,375
- ------------------------------------------------------------------------------------------------------------------------============
Electronics:
Semiconductor 1.61% Texas Instruments Inc. 6,000 581,250
- ------------------------------------------------------------------------------------------------------------------------============
Energy Equipment Schlumberger Ltd. 11,000 618,750
& Services 1.91% Transocean Sedco Forex Inc. 2,134 71,889
Total 690,639
- ------------------------------------------------------------------------------------------------------------------------============
3
<PAGE>
Statement of Net Assets
LORD ABBETT SERIES FUND, INC. - GROWTH AND INCOME PORTFOLIO December 31, 1999
Investments Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
Financial Services 1.38% Morgan Stanley Dean Witter & Co. 3,500 $ 499,625
- ------------------------------------------------------------------------------------------------------------------------============
Financial:
Miscellaneous 1.21% Fannie Mae 7,000 437,063
- ------------------------------------------------------------------------------------------------------------------------============
Food 3.06% Archer-Daniels-Midland Co. 45,000 548,438
Ralston-Ralston Purina Group 20,000 557,500
Total 1,105,938
- ------------------------------------------------------------------------------------------------------------------------============
Healthcare Aetna Inc. 6,000 334,875
Management Services 2.15% Cigna Corp. 5,500 443,094
Total 777,969
- ------------------------------------------------------------------------------------------------------------------------============
Healthcare Services 1.21% Columbia HCA Healthcare Corp. 15,000 439,688
- ------------------------------------------------------------------------------------------------------------------------============
Household Equipment/Products
1.30% Black & Decker Corp. 9,000 470,250
- ------------------------------------------------------------------------------------------------------------------------============
Insurance 6.43% Ace Ltd. 10,000 166,875
American General Corp. 11,000 834,625
Aon Corp. 17,000 680,000
Jefferson-Pilot Corp. 7,000 477,750
St. Paul Companies Inc. 5,000 168,438
Total 2,327,688
- ------------------------------------------------------------------------------------------------------------------------============
Machinery: Agriculture 1.80% Deere & Co. 15,000 650,625
- ------------------------------------------------------------------------------------------------------------------------============
Natural Gas 1.37% Coastal Corp. 14,000 496,125
- ------------------------------------------------------------------------------------------------------------------------============
Oil: Integrated
Domestic 1.79% Atlantic Richfield Co. 7,500 648,750
- ------------------------------------------------------------------------------------------------------------------------============
Oil: Integrated BP Amoco plc ADR 4,500 266,906
International 5.96% Exxon Mobil Corp. 11,000 886,188
Texaco Inc. 7,000 380,187
Total Fina SA 9,000 623,250
Total 2,156,531
- ------------------------------------------------------------------------------------------------------------------------============
Paper and Forest
Products 2.65% International Paper Co. 17,000 959,438
- ------------------------------------------------------------------------------------------------------------------------============
Publishing 3.53% Dow Jones & Co. Inc. 8,500 578,000
Gannett Co. Inc. 6,000 489,375
Tribune Co. 3,800 209,238
Total 1,276,613
- ------------------------------------------------------------------------------------------------------------------------============
Radio & TV Broadcasting 1.41% CBS Corp.* 8,000 511,500
- ------------------------------------------------------------------------------------------------------------------------============
Retail 2.38% Consolidated Stores Corp.* 25,000 406,250
Federated Department Stores, Inc.* 9,000 455,063
Total 861,313
- ------------------------------------------------------------------------------------------------------------------------============
Steel .46% USX-U.S. Steel Group 5,000 165,000
- ------------------------------------------------------------------------------------------------------------------------============
Telecommunications 4.73% Alltel Corp. 7,500 620,156
Bell Atlantic Corp. 9,000 554,063
SBC Communications Inc. 11,000 536,250
Total 1,710,469
- ------------------------------------------------------------------------------------------------------------------------============
Telephone: AT&T Corp. 18,000 913,500
Long Distance 3.95% MCI WorldCom Inc.* 9,750 517,359
Total 1,430,859
- ------------------------------------------------------------------------------------------------------------------------============
4
<PAGE>
Statement of Net Assets
LORD ABBETT SERIES FUND, INC. - GROWTH AND INCOME PORTFOLIO December 31, 1999
Investments Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
Total Investments in Common Stocks (Cost $30,145,414) $ 33,440,081
- ------------------------------------------------------------------------------------------------------------------------============
Convertible-Preferred Stock 1.99%
- ------------------------------------------------------------------------------------------------------------------------============
Broadcasting 1.00% Houston Industries Inc. Conv. Pfd. 7% into Time Warner 3,000 361,500
- ------------------------------------------------------------------------------------------------------------------------============
Entertainment .99% Seagram Co. Ltd. Conv. Pfd. 7.50% 8,000 360,000
- ------------------------------------------------------------------------------------------------------------------------============
Total Investments in Convertible-Preferred Stocks (Cost $673,274) 721,500
- ------------------------------------------------------------------------------------------------------------------------============
Short-Term Investments 4.94% Principal Amount
- ------------------------------------------------------------------------------------------------------------------------============
American Express Credit Corp. 2.50% due 1/4/2000 $ 205,000 205,000
American Express Credit Corp. 4.25% due 1/3/2000 1,360,000 1,360,000
Associates First Capital Corp. 4.05% due 1/3/2000 223,000 223,000
- ------------------------------------------------------------------------------------------------------------------------============
Total Short-Term Investments (Cost $1,788,000) 1,788,000
- ------------------------------------------------------------------------------------------------------------------------============
Total Investments 99.33% (Cost $32,606,688) 35,949,581
- ------------------------------------------------------------------------------------------------------------------------============
Cash and Receivables, Net of Liabilities .67% 242,068
- ------------------------------------------------------------------------------------------------------------------------============
Net Assets 100.00% (Equivalent to $22.16 per share; 1,632,897 shares of
$.001 par value capital stock outstanding;
authorized 50,000,000 shares) $36,191,649
- ------------------------------------------------------------------------------------------------------------------------============
</TABLE>
* Non-income producing security.
ADR American Depositary Receipt.
See Notes to Financial Statements.
5
<PAGE>
<TABLE>
<CAPTION>
Statement of Net Assets
LORD ABBETT SERIES FUND, INC. - MID-CAP VALUE PORTFOLIO December 31, 1999
Investments Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Investments in Common Stocks 92.46%
- ------------------------------------------------------------------------------------------------------------------------============
Air Transportation 1.58% SkyWest Inc. 300 $ 8,400
- ------------------------------------------------------------------------------------------------------------------------============
Apparel 1.75% Tommy Hilfiger Corp.* 400 9,325
- ------------------------------------------------------------------------------------------------------------------------============
Auto Parts:
After Market .50% Snap-on, Inc. 100 2,656
- ------------------------------------------------------------------------------------------------------------------------============
Banks: Regional .97% Cullen/Frost Bankers Inc. 200 5,150
- ------------------------------------------------------------------------------------------------------------------------============
Chemicals 3.02% CK Witco Corp. 1,200 16,050
- ------------------------------------------------------------------------------------------------------------------------============
Communications
Technology 2.93% Cabletron Systems Inc.* 600 15,600
- ------------------------------------------------------------------------------------------------------------------------============
Containers 5.44% American National Can Group 500 6,500
Ball Corp. 300 11,812
Pactiv Corp.* 1,000 10,625
Total 28,937
- ------------------------------------------------------------------------------------------------------------------------============
Drugs 2.84% Mylan Laboratories Inc. 600 15,112
- ------------------------------------------------------------------------------------------------------------------------============
Electric Power 11.11% FirstEnergy Corp. 300 6,806
Illinova Corp. 400 13,900
Ipalco Enterprises Inc. 400 6,825
Niagara Mohawk Holdings, Inc.* 700 9,756
Northeast Utilities 500 10,281
SCANA Corp. 300 8,063
Sierra Pacific Resources 200 3,463
Total 59,094
- ------------------------------------------------------------------------------------------------------------------------============
Electronics:
Semiconductor 3.20% Varian Semiconductor Equipment Associates, Inc.* 500 17,000
- ------------------------------------------------------------------------------------------------------------------------============
Financial Services 1.99% CIT Group Inc. Class A 500 10,562
- ------------------------------------------------------------------------------------------------------------------------============
Food 7.18% Dean Foods Co. 300 11,925
Del Monte Foods Co.* 700 8,619
IBP Inc. 300 5,400
Universal Foods Corp. 600 12,225
Total 38,169
- ------------------------------------------------------------------------------------------------------------------------============
Gaming 2.30% Mirage Resorts Inc.* 800 12,250
- ------------------------------------------------------------------------------------------------------------------------============
Healthcare Products 3.96% Acuson Corp.* 700 8,794
St. Jude Medical, Inc.* 400 12,275
Total 21,069
- ------------------------------------------------------------------------------------------------------------------------============
Healthcare Services 6.48% Caremark Rx Inc.* 2,700 13,669
Trigon Healthcare Inc. Class A* 200 5,900
Varian Medical Systems Inc.* 500 14,906
Total 34,475
- ------------------------------------------------------------------------------------------------------------------------============
Insurance 5.07% MONY Group Inc. 300 8,756
Transatlantic Holdings Inc. 100 7,806
XL Capital Ltd. Class A 200 10,375
Total 26,937
- ------------------------------------------------------------------------------------------------------------------------============
Materials & Commodities .92% IMC Global Inc. 300 4,913
- ------------------------------------------------------------------------------------------------------------------------============
6
<PAGE>
Statement of Net Assets
LORD ABBETT SERIES FUND, INC. - MID-CAP VALUE PORTFOLIO December 31, 1999
Investments Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
Milling: Fruits/Grain 2.46% Corn Products International Inc. 400 $ 13,100
- ------------------------------------------------------------------------------------------------------------------------============
Natural Gas 6.76% Dynegy Inc. 900 21,881
EOG Resources Inc. 800 14,050
Total 35,931
- ------------------------------------------------------------------------------------------------------------------------============
Oil: Crude Producers 3.39% Kerr-McGee Corp. 200 12,400
Santa Fe Snyder Corp.* 700 5,600
Total 18,000
- ------------------------------------------------------------------------------------------------------------------------============
Oil: Integrated
Domestic 1.07% Amerada Hess Corp. 100 5,675
- ------------------------------------------------------------------------------------------------------------------------============
Oil: Refiners 3.95% Ultramar Diamond Shamrock Corp. 400 9,075
Valero Energy Corp. 600 11,925
Total 21,000
- ------------------------------------------------------------------------------------------------------------------------============
REITs 2.06% Healthcare Realty Trust Inc. 700 10,938
- ------------------------------------------------------------------------------------------------------------------------============
Restaurants 2.19% CBRL Group Inc. 1,200 11,644
- ------------------------------------------------------------------------------------------------------------------------============
Retail 2.45% Consolidated Stores Corp.* 800 13,000
- ------------------------------------------------------------------------------------------------------------------------============
Synthetic Fibers 3.43% Polymer Group Inc. 1,000 18,250
- ------------------------------------------------------------------------------------------------------------------------============
Utilities 3.46% Eastern Enterprises 200 11,488
Southwest Gas Corp. 300 6,900
Total 18,388
- ------------------------------------------------------------------------------------------------------------------------============
Total Investments in Common Stocks (Cost $487,264) 491,625
- ------------------------------------------------------------------------------------------------------------------------============
Other Assets, Less Liabilities 7.54%
- ------------------------------------------------------------------------------------------------------------------------============
Cash 39,869
- ------------------------------------------------------------------------------------------------------------------------============
Receivable for: Dividends 388
Other 4,300
Total Other Assets 44,557
- ------------------------------------------------------------------------------------------------------------------------============
Payables for: Capital stock reacquired 21
Other 4,423
Total Liabilities 4,444
- ------------------------------------------------------------------------------------------------------------------------============
Total Other Assets, Less Liabilities 40,113
- ------------------------------------------------------------------------------------------------------------------------============
Net asset 100.00%
(Equivalent to $9.87 per share; 53,894 shares of $.001 par value capital stock
outstanding; authorized 50,000,000 shares) $ 531,738
- ------------------------------------------------------------------------------------------------------------------------============
</TABLE>
*Non-income producing security.
See Notes to Financial Statements.
7
<PAGE>
<TABLE>
<CAPTION>
Statement of Net Assets
LORD ABBETT SERIES FUND, INC. - INTERNATIONAL PORTFOLIO December 31, 1999
Investments Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Investments in Common Stocks 96.43%
- ------------------------------------------------------------------------------------------------------------------------============
Foreign 96.43%
- ------------------------------------------------------------------------------------------------------------------------============
Australia 5.01% Biota Holdings Ltd.* 4,500 $ 18,182
Novogen Limited* 7,500 15,078
Total 33,260
- ------------------------------------------------------------------------------------------------------------------------============
Canada 1.70% Ballard Power Systems Inc.* 400 11,284
- ------------------------------------------------------------------------------------------------------------------------============
France 11.05% Alcatel 100 22,971
Cap Gemini SA 100 25,389
UBI Soft Entertainment SA* 120 24,059
UBI Soft Entertainment SA* Warrants expiring 11/2/2002 20 846
Total 73,265
- ------------------------------------------------------------------------------------------------------------------------============
Germany 16.72% DePfa Deutsche Pfandbriefbank AG 200 15,153
Drillisch AG 150 1,058
Marschollek, Lautenschlaeger Und Partner AG 65 19,319
MobilCom AG 175 15,181
SAP AG 50 24,583
SKW Trostberg AG 1,560 12,180
Vossloh AG 600 8,916
W.E.T. Automotive Systems AG* 400 14,508
Total 110,898
- ------------------------------------------------------------------------------------------------------------------------============
Japan 28.00% Asahi Chemical Industry Co., Ltd. 3,000 15,402
Colin Corp. 100 14,180
Honda Tsushin Kogyo Co., Ltd. 300 22,149
Japan Asia Investment Co. 2,000 32,857
Katokichi Co., Ltd. 1,000 21,660
Nomura Securities Co., Ltd. 1,000 18,042
Omron Corp. 700 16,121
Park24 Co., Ltd. 200 17,896
Toyoda Gosei Co., Ltd. 500 27,381
Total 185,688
- ------------------------------------------------------------------------------------------------------------------------============
Netherlands 4.70% Getronics NV 250 19,949
Koninklijke Numico NV 300 11,195
Total 31,144
- ------------------------------------------------------------------------------------------------------------------------============
United Kingdom 29.25% Ashtead Group plc 5,000 13,592
First Technology plc 2,000 17,532
Gameplay.com plc* 3,000 22,937
Hays plc 1,000 15,954
Jarvis plc 3,500 12,459
London Bridge Software Holdings plc 200 14,126
Mayflower Corp. plc 4,000 14,110
NXT plc* 1,500 33,252
Pilkington plc 12,000 16,408
Trifast plc 1,000 16,221
Vodafone AirTouch plc 3,500 17,373
Total 193,964
- ------------------------------------------------------------------------------------------------------------------------============
8
<PAGE>
Statement of Net Assets
LORD ABBETT SERIES FUND, INC. - INTERNATIONAL PORTFOLIO December 31, 1999
Investments Shares Value
- ------------------------------------------------------------------------------------------------------------------------------------
Total Investments in Common Stocks (Cost $543,172) $ 639,503
- ------------------------------------------------------------------------------------------------------------------------============
Cash and Receivables, Net of Liabilities 3.57% 23,666
- ------------------------------------------------------------------------------------------------------------------------============
Net Assets 100.00% (Equivalent to $11.86 per share; 55,917 shares of
$.001 par value capital stock outstanding;
authorized 50,000,000 shares) $ 663,169
- ------------------------------------------------------------------------------------------------------------------------============
</TABLE>
* Non-income producing security.
See Notes to Financial Statements.
9
<PAGE>
Statements of Operations
<TABLE>
<CAPTION>
Year Ended Sept. 15, 1999* to Sept. 15, 1999* to
Dec. 31, 1999 Dec. 31, 1999 Dec. 31,1999
- ------------------------------------------------------------------------------------------------------------------------------------
Growth and Income Mid-Cap Value International
Investment Income Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Income Dividends $ 771,179 $ 1,941 $ 287
Interest (net of foreign tax withheld
of $280, $0 and $9, respectively) 75,691 551 1,202
Other 72,543 - -
Total income 919,413 2,492 1,489
====================================================================================================================================
Expenses Management fee 152,068 1,094 1,634
Management fee waived - (1,094) (1,634)
Professional 42,928 4,000 4,000
Shareholder servicing 29,261 100 100
Reports to shareholders 21,565 100 100
Other 19,803 100 2,600
Total expenses before reimbursements 265,625 4,300 6,800
- ------------------------------------------------------------------------------------------------------------------------------------
Expense reimbursements - (4,300) (6,800)
- ------------------------------------------------------------------------------------------------------------------------------------
Net expenses 265,625 - -
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income 653,788 2,492 1,489
- ------------------------------------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized gain (loss) from investment transactions 153,506,849 (9,558) 51,600
- ------------------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation of investments (118,506,201) 4,361 96,331
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) on investments 35,000,648 (5,197) 147,931
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting From Operations $35,654,436 $(2,705) $149,420
====================================================================================================================================
</TABLE>
*Commencement of operations.
See Notes to Financial Statements.
10
<PAGE>
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended Year Ended Sept. 15, 1999* to Sept. 15, 1999* to
Dec. 31, 1999 Dec. 31, 1998 Dec. 31, 1999 Dec. 31, 1999
- ------------------------------------------------------------------------------------------------------------------------------------
Growth and Income Growth and Income Mid-Cap Value International
Increase (Decrease) in Net Assets Portfolio Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operations Net investment income $ 653,788 $ 10,875,399 $ 2,492 $ 1,489
Net realized gain (loss) from
investment transactions 153,506,849 34,240,047 (9,558) 51,600
Net change in unrealized appreciation
of investments (118,506,201) 29,394,800 4,361 96,331
Net increase (decrease) in net assets
resulting from operations 35,654,436 74,510,246 (2,705) 149,420
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders from:
Net investment income (606,447) (10,531,538) (2,455) (1,461)
Net realized gain from investment transactions (2,143,412) (33,862,945) -- (52,431)
Total distributions (2,749,859) (44,394,483) (2,455) (53,892)
- ------------------------------------------------------------------------------------------------------------------------------------
Capital share transactions:
Net proceeds from sales of
1,354,299; 6,898,183;
53,641 and 51,252 shares, respectively 30,453,087 141,925,049 534,471 513,766
Net asset value of 126,722; 2,156,014;
256 and 4,666 shares,
respectively, issued in reinvestment
of dividends and distributions 2,749,859 44,394,483 2,455 53,887
Total 33,202,946 186,319,532 536,926 567,653
- ------------------------------------------------------------------------------------------------------------------------------------
Cost of 152,251; 728,296;
3 and 1 shares reacquired, respectively (592,834,481) (14,598,679) (28) (12)
- ------------------------------------------------------------------------------------------------------------------------------------
Redemption in kind of 34,287,022; 0;
0 and 0 shares, respectively (151,355,638) -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net
assets derived from
capital share transactions
(net change of (32,958,252);
8,325,901; 53,894 and 55,917
shares, respectively) (710,987,173) 171,720,853 536,898 567,641
- ------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets (678,082,596) 201,836,616 531,738 663,169
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets
Beginning of year 714,274,245 512,437,629 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
End of year+ $36,191,649 $714,274,245 $531,738 $663,169
====================================================================================================================================
*Commencement of operations.
+Includes undistributed (distribution in excess of) net investment income of $(62,550), $(109,891), $37 and $28,
respectively.
See Notes to Financial Statements.
</TABLE>
11
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
Year Ended December 31,
Growth and Income Portfolio
Per Share Operating Performance: 1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year $20.649 $19.510 $17.022 $15.241 $12.710
- ------------------------------------------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income .52(a) .360(a) .393(a) .408 .459
Net realized and unrealized gain
on investments 2.90 2.149 3.755 2.563 3.332
Total from investment operations 3.42 2.509 4.148 2.971 3.791
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions
Dividends from net investment income (.42) (.325) (.34) (.36) (.36)
Distributions from net realized gain (1.49) (1.045) (1.32) (.83) (.90)
Total dividends and distributions (1.91) (1.37) (1.66) (1.19) (1.26)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of year $22.160 $20.649 $19.510 $17.022 $15.241
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return(d) 16.74% 12.82% 24.34% 19.49% 29.82%
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net assets, end of year (000) $36,192 $714,274 $512,438 $303,982 $193,575
Ratios to Average Net Assets:
Expenses .87% .51% .52% .52% .52%
Net investment income 2.15% 1.78% 2.02% 2.32% 2.91%
Portfolio turnover rate 188.35% 76.62% 43.09% 48.93% 70.30%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Mid-Cap Value Portfolio International Portfolio
September 15, 1999(c) to September 15, 1999(c) to
Per Share Operating Performance December 31,1999 December 31,1999
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net asset value, beginning of period $10.00 $10.00
Income from investment operations
Net investment income(a) .05 .03
Net realized and unrealized gain (loss)
on investments (.13) 2.88
Total from investment operations (.08) 2.91
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions
Dividends from net investment income (.05) (.03)
Distributions from net realized gain - (1.02)
Total dividends and distributions (.05) (1.05)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 9.87 $11.86
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return(b) (d) (.82)% 29.39%
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net assets, end of period (000) $ 532 $ 663
Ratios to Average Net Assets(b):
Expenses including waiver and reimbursements 0.00% 0.00%
Expenses excluding waiver and reimbursements 1.09% 1.53%
Net investment income .51% .27%
Portfolio turnover rate 22.92 38.29%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a)Calculated using average shares outstanding during the period.
(b)Not annualized.
(c)Commencement of operations.
(d)Total return assumes the reinvestment of all distributions.
See Notes to Financial Statements.
12
<PAGE>
Notes to Financial Statements
1. Significant Accounting Policies
Lord Abbett Series Fund, Inc. (the "Company") is an open-end management
investment company incorporated under Maryland law on August 28, 1989. The
Company currently consists of three active portfolios - Growth and Income
Portfolio, Mid-Cap Value Portfolio and International Portfolio ("Series"). Each
Series is diversified as defined under the Investment Company Act of 1940.
Growth and Income Portfolio commenced operations on December 11, 1989. Mid-Cap
Value Portfolio and International Portfolio commenced operations on September
15, 1999. Shares of each Series are currently issued and redeemed only in
connection with investment in, and payments under, variable annuity contracts
issued by life insurance and insurance-related companies. The financial
statements have been prepared in conformity with generally accepted accounting
principles which require management to make certain estimates and assumptions at
the date of the financial statements. The following summarizes the significant
accounting policies of the Company:
(a) Securities are valued as follows: Portfolio securities listed or admitted to
trading privileges on any national securities exchange are valued at the last
sales price on the principal securities exchange on which such securities are
traded, or, if there is no sale, at the mean between the last bid and asked
prices on such exchange. Securities traded in the over-the-counter market are
valued at the mean between the last bid and asked prices, except that securities
admitted to trading on the NASDAQ National Market System are valued at the last
sales price if it is determined that such price more accurately reflects the
value of such securities. Securities for which market quotations are not
available are valued at fair value under procedures approved by the Board of
Directors. Short-term securities maturing in 60 days or less are valued at
amortized cost, which approximates market value.
(b) Transactions denominated in foreign currencies are recorded in the Company's
records at the rate prevailing when earned or incurred. Asset and liability
accounts that are denominated in foreign currencies are adjusted to reflect
current exchange rates.
(c) It is the policy of the Company to meet the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its taxable income. Therefore, no federal income tax provision is required.
(d) Investment transactions are accounted for on the date that the securities
are purchased or sold (trade date). Realized gains and losses from investment
transactions are calculated on the identified cost basis. Dividend income and
distributions to shareholders are recorded on the ex-dividend date. Interest
income is recorded on the accrual basis.
13
<PAGE>
Notes to Financial Statements
2. Management Fee and Other Transactions with Affiliates
The Company has a management agreement with Lord, Abbett & Co. ("Lord Abbett")
pursuant to which Lord Abbett supplies the Company with investment management
services and executive and other personnel, pays the remuneration of officers,
provides office space and pays for ordinary and necessary office and clerical
expenses relating to research and statistical work. The management fee paid to
Lord Abbett is based on average daily net assets at an annual rate of .50% for
Growth and Income Portfolio, .75% for Mid-Cap Value Portfolio and 1.00% for
International Portfolio. Lord Abbett waived its fees for Mid-Cap Value Portfolio
and International Portfolio for the period ended December 31, 1999. At December
31, 1999, the management fee payable was $7,784 for Growth and Income Portfolio.
Other assets and liabilities include $4,300 and $6,800 receivable from Lord
Abbett for expenses reimbursed for Mid-Cap Value Portfolio and International
Portfolio, respectively. Certain of the Company's officers and Directors have an
interest in Lord Abbett.
Lord Abbett has entered into a sub-investment management agreement with
Fuji-Lord Abbett International, Ltd. ("sub- adviser"). Lord Abbett is a minority
owner of the sub-adviser. The sub-adviser furnishes investment advisory services
in connection with the management of International Portfolio. Lord Abbett pays
for the cost of the sub-adviser's services.
Growth and Income Portfolio has a service agreement which permits it to make
payments under certain circumstances to insurance companies at the annual rate
of .25% of the average daily net asset value of shares of the Series
attributable to the insurance companies' variable annuity contract owners.
3. Distributions
Distributions from net investment income and net realized gain from investment
transactions, if any, are declared annually. Undistributed (accumulated) net
realized capital gain (loss) at December 31, 1999, for financial statement
purposes, aggregated $186,535 for Growth and Income Portfolio and $(9,558) for
Mid-Cap Value Portfolio. Distributions in excess of net realized capital gain
aggregated $831 for International Portfolio.
Income and capital gains distributions are determined in accordance with income
tax regulations which may differ from methods used to determine the
corresponding income and capital gain amounts in accordance with generally
accepted accounting principles.
4. Paid-in-Capital
At December 31, 1999, paid-in-capital for each Series was as follows:
Series
- --------------------------------------------------------------------------------
Growth and Income Portfolio $ 32,724,771
- --------------------------------------------------------------------------------
Mid-Cap Value Portfolio 536,898
- --------------------------------------------------------------------------------
International Portfolio 567,641
- --------------------------------------------------------------------------------
14
<PAGE>
Notes to Financial Statements
5. Purchases and Sales of Securities
Purchases and sales of investment securities (other than short-term investments
and redemption in kind in Growth and Income Portfolio) for the period ended
December 31, 1999 were as follows:
<TABLE>
<CAPTION>
Series Purchases Sales
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Growth and Income Portfolio $ 52,759,633 $ 733,747,497
- ----------------------------------------------------------------------------------------------------------
Mid-Cap Value Portfolio 599,535 102,713
- ----------------------------------------------------------------------------------------------------------
International Portfolio 683,181 191,609
- ----------------------------------------------------------------------------------------------------------
As of December 31, 1999, net unrealized appreciation, gross unrealized
appreciation and gross unrealized depreciation of investments based on cost for
federal income tax purposes were as follows:
- ----------------------------------------------------------------------------------------------------------
Net Unrealized Unrealized Unrealized
Series Appreciation Appreciation Depreciation
- ----------------------------------------------------------------------------------------------------------
Growth and Income Portfolio $ 3,342,893 $ 4,546,920 $ (1,204,027)
- ----------------------------------------------------------------------------------------------------------
Mid-Cap Value Portfolio 4,361 38,167 (33,806)
International Portfolio 96,331 121,147 (24,816)
- ----------------------------------------------------------------------------------------------------------
</TABLE>
For federal income tax purposes, the identified cost of investments at December
31, 1999 was substantially the same as the cost for financial reporting
purposes.
6. Directors' Remuneration
The Directors of the Company associated with Lord Abbett and all officers of the
Company receive no compensation from the Company for acting as such. Outside
Directors' fees and retirement costs are allocated among all funds in the Lord
Abbett group based on the net assets of each fund. The Directors' fees payable
at December 31, 1999, under a deferred compensation plan, were $35,855.
7. Redemption In Kind
On January 8, 1999, Growth and Income Portfolio incurred a redemption in kind
from a shareholder (insurance company separate account) in the amount of
34,287,022 shares. A redemption in kind occurs when a shareholder account is
redeemed with portfolio securities in lieu of cash. The unrealized appreciation
related to the securities transferred in kind totaled $151,355,638 and is
included in capital activity in the Statements of Changes in Net Assets.
15
<PAGE>
Independent Auditors' Report
The Board of Directors and Shareholders,
Lord Abbett Series Fund, Inc.:
We have audited the accompanying statement of net assets of Lord Abbett Series
Fund, Inc. - Growth and Income Portfolio, Mid-Cap Value Portfolio and
International Portfolio as of December 31, 1999, the related statements of
operations for the year then ended and of changes in net assets for each of the
years in the two-year period then ended and the financial highlights for each of
the five years presented. These financial statements and the financial
highlights are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and the
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 at December
31, 1999, by cor res pondence with the custodian and brokers; where replies were
not received from brokers, we performed other auditing procedures. 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, such financial statements and financial highlights present
fairly, in all material respects, the financial position of Lord Abbett Series
Fund, Inc. - Growth and Income Portfolio, Mid-Cap Value Portfolio and
International Portfolio as of December 31, 1999, the results of its operations,
the changes in its net assets and the financial highlights for each of the
periods presented in conformity with generally accepted accounting principles.
[GRAPHIC OMITTED
New York, New York
February 25, 2000
16
<PAGE>
Numbers to Keep Handy
For Shareholder Account or Statement
Inquiries: 800-821-5129
For Literature Only: 800-874-3733
24-Hour Automated Shareholder
Service Line: 800-865-7582
Visit Our Web Site:
www.lordabbett.com
[LOGO]
Lord Abbett mutual fund shares are distributed by: LORD ABBETT DISTRIBUTOR LLC
90 Hudson Street o Jersey City, New Jersey 07302-3973
LASF-2-1299
(3/00)
