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SEMI-ANNUAL REPORT
THE STRONG
INTERNATIONAL
FUNDS
The Strong Asia Pacific Fund
The Strong Foreign MajorMarkets -SM- Fund
The Strong International Stock Fund
The Strong Overseas Fund
The Strong Global High-Yield Bond Fund
The Strong International Bond Fund
The Strong Short-Term Global Bond Fund
SEMI-ANNUAL REPORT - APRIL 30, 2000
<PAGE>
LETTER FROM THE CHAIRMAN
Dear Strong Investor,
There is an old Wall Street saying that goes something like this: "Don't fight
the Fed." This is a basic rule you ignore at your own peril.
Since June of 1999, the Federal Reserve Board has raised short-term interest
rates five times with one goal in mind: to slow the economy. This past winter
and spring, the U.S. financial markets began to react to the Fed's actions
swiftly and dramatically. The speed and violence of the downdraft that followed
was enough to scare even the most seasoned investors.
What happened to the financial markets was capitalism doing what it does
best--separating the weak from the strong. Capitalism takes no prisoners. It has
an uncanny ability to seek out the excesses in the system and to separate
quality companies from deficient ones. To my way of thinking, that only serves
to underscore the importance of quality, balance, and diversification in a
portfolio. This spring's financial damage rather dramatically exposed the
excesses in technology and Internet investments and burst the bubble that had
formed around these sectors of the market.
Meanwhile, we are in the tenth year of an unprecedented economic expansion. A
large part of the credit for our good fortune belongs to Alan Greenspan's
shaping of monetary policy and the Fed's rather remarkable achievements in
managing interest rates. Under the current circumstances, the question most
investors need to ask is how to continue participating in the opportunities
available without exposing themselves to too much risk.
When I was a rookie in the investment business, an old-timer told me that too
many people treat investing as entertainment. Investing is not a game. It is a
vital component of the capitalist system. If you want to make your way through
the system without losing your shirt, you need to pick a specific financial
destination and get a reliable investment road map that will take you there.
A successful investment program involves finding companies with proven
management along with real products and services. In other words, invest in
people and companies who you are confident will do exactly what they say they
will do. Identifying them requires research, patience, and experience.
Investing is not a game of hot potato where you buy a stock, pray that the price
goes up, and then pass it to some poor soul when the price is on the way down.
That's not serious investing. That's more like a guarantee that someone--either
you or the next guy--is going to get burned.
/s/ Dick
<PAGE>
THE STRONG
INTERNATIONAL
FUNDS
------------
SEMI-ANNUAL REPORT - APRIL 30, 2000
TABLE OF CONTENTS
INVESTMENT REVIEWS
The Strong Asia Pacific Fund .........................................2
The Strong Foreign MajorMarkets-SM- Fund .............................4
The Strong International Stock Fund ..................................6
The Strong Overseas Fund .............................................8
The Strong Global High-Yield Bond Fund ..............................10
The Strong International Bond Fund ..................................12
The Strong Short-Term Global Bond Fund ..............................14
FINANCIAL INFORMATION
Schedules of Investments in Securities
The Strong Asia Pacific Fund ....................................16
The Strong Foreign MajorMarkets-SM- Fund ........................17
The Strong International Stock Fund .............................18
The Strong Overseas Fund ........................................19
The Strong Global High-Yield Bond Fund ..........................20
The Strong International Bond Fund ..............................21
The Strong Short-Term Global Bond Fund ..........................22
Statements of Assets and Liabilities ................................24
Statements of Operations ............................................26
Statements of Changes in Net Assets .................................28
Notes to Financial Statements .......................................32
FINANCIAL HIGHLIGHTS .....................................................36
<PAGE>
THE STRONG ASIA PACIFIC FUND
----------------------------
PERSPECTIVES
FROM THE MANAGER
/s/ Anthony Cragg
Anthony Cragg
Portfolio Manager
--------------------------------------------------------------------------------
The past six months have once again demonstrated the volatile nature of Asian
investments. Toward the end of 1999, Asian equities tended to rise ahead of
themselves. Clearly, the recovery in stock prices could not continue on a
straight line, nor at such a rapid pace.
Asian markets ran into turbulence for many reasons. One was internal: the
inevitable cooling off of this overheated situation. The recovery in Asian
economies is, after all, still at a fairly early stage and is not consistent
among countries--and is still vulnerable to government mishandling as in
Indonesia and the Philippines. The other causes for the correction were
external: the threat of higher interest rates in the U.S. and the sudden
disillusionment with Nasdaq high-fliers, which seemed to expose weaknesses in
most new economy stocks.
In response to these buffeting winds, we have tried to steer as steady a course
as possible for the Fund. We have significantly reduced the number of holdings
in the Fund, focusing more on our core positions. We have maintained our large
weightings in relatively more stable markets, such as Singapore, Japan, and
Australia. We have reduced exposure to more marginal countries, including the
Philippines and Indonesia, as well as those like South Korea that tend to be
more erratic.
We have paid close attention to keeping a sensible balance between old and new
economy stocks.
------------------------------------
WE HAVE
SIGNIFICANTLY REDUCED
THE NUMBER OF
HOLDINGS IN THE FUND,
FOCUSING MORE ON OUR
CORE POSITIONS.
------------------------------------
[SIDENOTE]
FUND
HIGHLIGHTS
- For the six months ended April 30, 2000, the Fund returned 7.44%, compared
with a 5.65% return for its benchmark, the MSCI AP Index.(1), *
- For much of the period, the Fund performed positively. In the first two
months, the Fund continued to storm ahead, while in the next three, the pace
slowed but the Fund still stayed ahead of the MSCI AP Index and in positive
territory.
- In April, the Fund suffered a sharp correction.
-------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
AS OF 4-30-00
<TABLE>
<S> <C>
1-year 32.00%
3-year 4.06%
5-year 4.02%
Since Inception 1.93%
(on 12-31-93)
</TABLE>
Please keep in mind that high double-digit returns are highly unusual and cannot
be sustained. Investors should also be aware that recent returns were primarily
achieved during favorable market conditions, especially within the technology
sector. Recent stock market fluctuations emphasize that equity funds can be
volatile investments. They should only be considered for long-term investment
goals.
-------------------------------------------------------------------------------
FIVE LARGEST
INVESTMENTS BY COUNTRY
BASED ON NET ASSETS AS OF 4-30-00
<TABLE>
<CAPTION>
COUNTRY % OF NET ASSETS
-------------------------------------
<S> <C>
Japan 24.1%
Australia 18.9%
Singapore 13.5%
Hong Kong 6.4%
Thailand 6.3%
</TABLE>
Please see the Schedule of Investments in Securities for a complete listing of
the Fund's portfolio.
-------------------------------------------------------------------------------
(1) Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change while
total return reflects aggregate change, and is not annualized.
2
<PAGE>
Our aim, as always, is to offer investors exposure to a broad spectrum of
investment opportunities in Asia. The new technologies are clearly a part of
Asia's present and future, just as they are in the U.S. Nonetheless, we want to
avoid overexposure to these stocks, which are inherently more volatile than most
of their old economy counterparts. We continue to recognize that there is
investment appeal in many of the more traditional businesses in Asia--perhaps
even more so than in the more technologically developed U.S. There is also an
interesting category of old economy companies that are taking advantage of the
newer technologies to enhance their revenues.
Once the current, largely U.S.-originated storm subsides, we are confident that
Asia will gradually reassert itself and regain faith in its own strengths.
Indeed, the healthiest effect to come out of the present upheaval might be that
investors have begun to focus more on the substance of good corporate and policy
management and less on the dream of more speculative ventures.
Thank you for your investment in the Strong Asia Pacific Fund. We appreciate
your commitment.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 12-31-93 TO 4-30-00
[GRAPH]
<TABLE>
<CAPTION>
The Strong Lipper Pacific
Asia Pacific Fund MSCI AP Region Funds Index
<S> <C> <C> <C>
Dec 93 $10,000 $10,000 $10,000
Dec 94 $9,473 $8,772 $9,475
Dec 95 $10,035 $9,305 $9,729
Dec 96 $10,246 $10,388 $9,994
Dec 97 $7,071 $6,835 $7,278
Dec 98 $6,849 $6,533 $7,064
Dec 99 $13,426 $9,789 $12,597
Apr 00 $11,290 $8,872 $11,013
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Morgan Stanley Capital International AC Asia Pacific Free ex. Japan Index ("MSCI
AP") and the Lipper Pacific Region Funds Index. Results include the reinvestment
of all dividends and capital gains distributions. Performance is historical and
does not represent future results. Investment returns and principal value vary,
and you may have a gain or loss when you sell shares.
[SIDENOTE]
YOUR FUND'S
APPROACH
THE STRONG ASIA PACIFIC FUND SEEKS CAPITAL GROWTH. THE FUND INVESTS PRIMARILY IN
STOCKS FROM COMPANIES LOCATED IN ASIA OR THE PACIFIC BASIN. THE FUND'S MANAGER
LOOKS FOR COMPANIES WITH POTENTIAL FOR ABOVE-AVERAGE SALES AND EARNINGS GROWTH,
OVERALL FINANCIAL STRENGTH, COMPETITIVE ADVANTAGES, AND CAPABLE MANAGEMENT.
-------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
- In the earlier months of the period, economic recovery in Asia continued.
Investors responded positively to such improving fundamentals as lower
interest rates, stronger property prices, improved consumer and investor
sentiment, and accelerating exports.
- At the same time, however, stock markets in Asia focused narrowly on the
potential of the Internet and other new economy sectors.
- As a result, when the Nasdaq corrected in April, Asian equities were severely
hurt. Exacerbating the stock-price declines were the redemptions Asian funds
experienced and the heavy-handed unwinding of Asian positions by some U.S.
hedge funds.
-------------------------------------------------------------------------------
* The Morgan Stanley Capital International AC Asia Pacific Free ex. Japan Index
("MSCI AP") is an unmanaged index generally representative of developed and
emerging markets in the Asia/Pacific region, excluding Japan. MSCI AP data is
U.S. dollar adjusted. The Lipper Pacific Region Funds Index is an
equally-weighted performance index of the largest qualifying funds in this
Lipper category. Source of the MSCI index data is Standard & Poor's Micropal.
Source of the Lipper index data is Lipper Inc.
3
<PAGE>
THE STRONG FOREIGN MAJORMARKETS-SM- FUND
-----------------------------------------
PERSPECTIVES
FROM THE MANAGER
/s/ David Lui
David Lui
Portfolio Manager
-------------------------------------------------------------------------------
Central banks are in a tightening mode, but these movements do not appear to be
coordinated. In each region, rates are moving up for different reasons.
The European central bank raised rates to defend the Euro. Inflation was not a
threat, as huge resource gaps remained. The Japanese central bank "talked up"
interest rates in that country in an effort to stem the outflow of postal
savings deposits and to raise the value of Japanese assets to foreigners.
Whatever the cause of the increases in the U.S. and elsewhere, rising rates
remain a serious concern to us. It is hard for us to believe that global stock
markets will move upward much until this tightening cycle concludes.
Europe's very strong economic fundamentals are nonetheless encouraging. The weak
Euro gives European companies an advantage over companies in the U.S. and Japan.
The weak Euro also benefits old economy stocks--manufacturers--more than new
economy stocks. That has led us to add positions in several of these old-economy
companies from Britain, the Netherlands, and Germany.
Technology remains an important theme for the Fund, however, so we are keeping
hold of our technology and telecom stalwarts. Continued upgrades in available
technology should help keep demand in these sectors robust.
Although the Japanese stock market has endured a great degree of turmoil, we
believe that in time, the positive forces will win out. Both the Japanese
government and the Japanese
----------------------------
TO MANAGE RISK IN THE
CURRENT ENVIRONMENT, WE ARE HOLDING ON
TO HIGHER-QUALITY COMPANIES...
----------------------------
[SIDENOTE]
FUND
HIGHLIGHTS
- The Fund returned 12.28% for the six months ended April 30, 2000, compared
with a 6.72% return for its benchmark, the MSCI EAFE Index.(1), *
- The Fund's outperformance of its benchmark was primarily driven by the
emphasis of the portfolio on technology, media, and telecommunications.
Investments within the initial public offering market contributed
meaningfully to our positive performance.
- We did increase our weighting in a few battered old economy stocks. The
unusually low valuations of these companies provided low downside risks and
made them attractive investment candidates in a turbulent market.
-------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
AS OF 4-30-00
<TABLE>
<S> <C>
1-year 21.79%
Since Inception 16.48%
(on 6-30-98)
</TABLE>
Recent stock market fluctuations emphasize that equity funds can be volatile
investments. They should only be considered for long-term investment goals.
-------------------------------------------------------------------------------
FIVE LARGEST
INVESTMENTS BY COUNTRY
BASED ON NET ASSETS AS OF 4-30-00
<TABLE>
<CAPTION>
COUNTRY % OF NET ASSETS
----------------------------------
<S> <C>
United Kingdom 16.7%
Japan 16.5%
Netherlands 9.6%
France 9.0%
Hong Kong 8.3%
</TABLE>
Please see the Schedule of Investments in Securities for a complete listing of
the Fund's portfolio.
-------------------------------------------------------------------------------
(1) Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change while
total return reflects aggregate change, and is not annualized.
4
<PAGE>
central bank seem to understand that a rising stock market is all but essential
to lift the country out of its ten-year recession. We were also encouraged that
Citibank recently committed to doubling its stake in Nikko Securities.
Elsewhere in Asia, we are holding our investments in high-quality companies in
Hong Kong and Singapore. In Australia, we increased our position in TABCORP
Holdings, the operator of the only casino in Sydney. We expect this stock to
benefit from the Olympic Games being held in that city later this year.
While we are not anticipating a market crash, we are on the lookout for more
turbulence ahead. For that reason, we are seeking to reduce the Fund's risk
profile somewhat. To manage risk in the current environment, we are holding on
to higher-quality companies such as Nokia and STMicroelectronics, and increasing
our exposure to attractively priced old economy stocks.
Thank you for your investment in the Strong Foreign MajorMarkets Fund.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 6-30-98 TO 4-30-00
[GRAPH]
<TABLE>
<CAPTION>
The Strong Foreign Lipper International
MajorMarkets-SM- Fund MSCI EAFE Funds Index
<S> <C> <C> <C>
Jun 98 $10,000 $10,000 $10,000
Aug 98 $8,760 $8,850 $8,693
Dec 98 $9,980 $10,351 $9,728
Apr 99 $10,860 $10,920 $10,312
Aug 99 $11,230 $11,122 $10,716
Dec 99 $14,211 $13,142 $13,409
Apr 00 $13,227 $12,437 $12,636
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Morgan Stanley Capital International Europe, Australasia, and Far East Index
("MSCI EAFE") and the Lipper International Funds Index. Results include the
reinvestment of all dividends and capital gains distributions. Performance is
historical and does not represent future results. Investment returns and
principal value vary, and you may have a gain or loss when you sell shares.
[SIDENOTE]
YOUR FUND'S
APPROACH
THE STRONG FOREIGN MAJORMARKETS-SM- FUND SEEKS CAPITAL GROWTH. THE FUND INVESTS
PRIMARILY IN STOCKS ISSUED BY COMPANIES IN THE COUNTRIES REPRESENTED IN THE MSCI
EAFE INDEX. THE FUND'S MANAGER EMPLOYS A DISCIPLINED, QUANTITATIVE APPROACH TO
IDENTIFY UNDERVALUED FOREIGN STOCKS. THE MANAGER THEN ANALYZES THESE STOCKS TO
MAKE FINAL SELECTIONS. TO MANAGE FOREIGN CURRENCY RISK, THE MANAGER MAY HEDGE A
PORTION OF THE FUND'S EXPOSURE TO CURRENCY FLUCTUATIONS.
--------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
- Western Europe led the international markets over the past six months.
Nonetheless, interest-rate concerns limited the region's performance.
- The Japanese market barely held steady over the period, as positive and
negative factors offset each other.
- The U.S. interest-rate cycle had its greatest impact on the rest of Asia.
Australia was also hampered by multiple rate increases by the Reserve Bank of
Australia, which was concerned about inflation and the weak Australian
dollar.
--------------------------------------------------------------------------------
* The MSCI EAFE is an unmanaged index generally representative of major overseas
stock markets. MSCI EAFE data is U.S. dollar adjusted. The Lipper International
Funds Index is an equally-weighted performance index of the largest qualifying
funds in this Lipper category. Source of the MSCI index data is Standard &
Poor's Micropal. Source of the Lipper index data is Lipper Inc.
5
<PAGE>
THE STRONG INTERNATIONAL STOCK FUND
-----------------------------------
PERSPECTIVES
FROM THE MANAGER
/s/ David Lui
David Lui
Portfolio Manager
--------------------------------------------------------------------------------
The biggest question facing an international fund manager is: Are the central
banks in a coordinated tightening mode? We will give our views by region as
follows:
The European Central Bank raised rates to defend the Euro. The Japanese Central
Bank talked up interest rates in order to stem the outflow of postal savings
deposits and to raise the value of Japanese assets to foreigners. Therefore,
while the U.S., Europe, and Japan could be raising rates simultaneously, they
would also be doing so independently. Nevertheless, it remains a big concern to
us. We believe that the global stock markets will not be making big upward moves
until the tightening cycle is over.
On the other hand, the economic fundamentals in Europe could not be better. The
weak Euro makes European companies much more competitive than U.S. and Japanese
companies. Moreover, a weak Euro will benefit the old economy stocks--the
manufacturing companies--more than new economy stocks. Therefore, we recently
started new positions in British Aerospace, British Airways, British Petroleum,
engineering company GKN, Netherlands-based health and baby-food company Numico,
and Germany's Adidas.
That doesn't mean we've abandoned technology and telecom stalwarts. Mobile
telephony is upgrading from voice to Internet, which should provide another
surge in demand for a new generation of cellular phones.
-----------------------
WE BELIEVE THAT
THE GLOBAL STOCK
MARKETS WILL NOT BE
MAKING BIG UPWARD
MOVES UNTIL THE
TIGHTENING CYCLE IS OVER.
-----------------------
[SIDENOTE]
FUND
HIGHLIGHTS
- The Fund returned 37.34% for the six months ended April 30, 2000. The MSCI
EAFE Index, the Fund's benchmark, returned 6.72% for the same period.(1), *
- The Fund's outperformance was primarily driven by the portfolio's emphasis on
three dominant sectors: technology, media, and telecommunications. In
addition, the portfolio focused primarily on highly profitable companies with
dominant market share.
- We increased our weighting in a few battered old economy stocks with
attractively low valuations.
--------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
AS OF 4-30-00
<TABLE>
<S> <C>
1-year 71.54%
3-year 11.79%
5-year 11.25%
Since Inception 11.41%
(on 3-4-92)
</TABLE>
Please keep in mind that high double-digit returns are highly unusual and cannot
be sustained. Investors should also be aware that recent returns were primarily
achieved during favorable market conditions, especially within the technology
sector. Recent stock market fluctuations emphasize that equity funds can be
volatile investments. They should only be considered for long-term investment
goals.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FIVE LARGEST
INVESTMENTS BY COUNTRY
BASED ON NET ASSETS AS OF 4-30-00
COUNTRY % OF NET ASSETS
----------------------------------
<S> <C>
Japan 17.9%
United Kingdom 16.0%
Netherlands 11.0%
Canada 8.6%
Finland 7.5%
</TABLE>
Please see the Schedule of Investments in Securities for a complete listing of
the Fund's portfolio.
--------------------------------------------------------------------------------
(1) Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change while
total return reflects aggregate change, and is not annualized.
6
<PAGE>
The Japanese government and the Japanese Central Bank both appreciate how
important a rising stock market is to lifting the country out of a ten-year
recession.
Although the global stock markets remain about 10% to 20% from their all time
highs, we see little likelihood of a stock market crash. However, we do
expect more turbulence ahead. We concluded that risks in the global stock
markets have risen enough that we would like to reduce the risk profile of
the portfolio. That is why we held onto the high-quality issues such as Nokia
and STMicroelectronics and why we increased the exposure to a few old economy
stocks that we thought were oversold. We believe that it will then be an
exciting ride into the new millennium and, hopefully, you will be on the ride
with us.
Thank you for your continued investment in the Strong International Stock Fund.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 3-4-92 TO 4-30-00
[GRAPH]
<TABLE>
<CAPTION>
The Strong Lipper International
International Stock Fund MS EAFE Funds Index
<S> <C> <C> <C>
Mar 92 $10,000 $10,000 $10,000
Dec 92 $9,819 $9,484 $9,495
Dec 93 $14,508 $12,572 $13,215
Dec 94 $14,282 $13,550 $13,118
Dec 95 $15,399 $15,069 $14,433
Dec 96 $16,660 $15,980 $16,515
Dec 97 $14,294 $16,264 $17,712
Dec 98 $13,287 $19,516 $19,955
Dec 99 $25,600 $24,779 $27,504
Apr 00 $24,139 $23,450 $25,919
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Morgan Stanley Capital International Europe, Australasia, and Far East Index
("MSCI EAFE") and the Lipper International Funds Index. Results include the
reinvestment of all dividends and capital gains distributions. Performance is
historical and does not represent future results. Investment returns and
principal value vary, and you may have a gain or loss when you sell shares. To
equalize the time periods, the indexes' performance was prorated for the month
of March 1992.
[SIDENOTE]
YOUR FUND'S
APPROACH
THE STRONG INTERNATIONAL STOCK FUND SEEKS CAPITAL GROWTH. THE
FUND SELECTS STOCKS FROM ANY FOREIGN COUNTRY. THE MANAGER SEEKS STOCKS THAT
APPEAR TO HAVE STRONG GROWTH POTENTIAL RELATIVE TO THEIR RISK USING A THREE-STEP
INVESTMENT PROCESS INVOLVING COUNTRY ALLOCATION, INTENSIVE IN-HOUSE RESEARCH,
AND CURRENCY MANAGEMENT. THE MANAGER EXAMINES THE ECONOMIC OUTLOOK OF INDIVIDUAL
COUNTRIES IN DETERMINING WHETHER TO INVEST AND CHOOSES INDIVIDUAL STOCKS BASED
ON RIGOROUS, IN-DEPTH ANALYSIS, WHICH MAY INCLUDE INTERVIEWS WITH COMPANY
LEADERS.
--------------------------------------------------------------------------------
MARKET HIGHLIGHTS
- Western Europe led international markets over the past six months.
Unfortunately, the European Central Bank was forced to raise interest rates to
defend the Euro and, as a result, capped Europe's stock markets.
- The Japanese market treaded water. The rest of Asia was more influenced by the
U.S. interest-rate cycle than any other region represented in the MSCI EAFE
index. Australia was also hampered by multiple rate increases by the Reserve
Bank of Australia, which was concerned about inflation and that nation's weak
dollar.
--------------------------------------------------------------------------------
* The MSCI EAFE is an unmanaged index generally representative of major overseas
stock markets. MSCI EAFE data is U.S. dollar adjusted. The Lipper
International Funds Index is an equally-weighted performance index of the
largest qualifying funds in this Lipper category. Source of the MSCI index
data is Standard & Poor's Micropal. Source of the Lipper index data is Lipper
Inc.
7
<PAGE>
THE STRONG OVERSEAS FUND
-----------------------
PERSPECTIVES
FROM THE MANAGER
/s/ David Lui
David Lui
Portfolio Manager
The current tightening cycle that is affecting markets in the U.S., Europe, and
Japan remains a big concern to us. We don't anticipate any big upward moves in
the global stock markets until this activity is over.
On the other hand, economic fundamentals in Europe are as strong as ever. We
believe that the effects of a weak Euro will not hinder the earnings of the
European companies going forward. Therefore, we have made new investments in
British Aerospace, British Airways, British Petroleum, engineering firm GKN,
Netherlands-based health- and baby-food company Numico, and Adidas of Germany.
We have at the same time retained our investments in technology and telecom
stalwarts such as Nokia, STMicroelectronics, and ASML. As mobile telephony
upgrades from voice to Internet, we anticipate another surge in demand for a new
generation of cellular phones. The demand for chips and chip equipment also
remains robust.
Mergers and acquisitions in Europe are moving beyond national borders. Although
a few high-profile attempts ended in failure, such as Telefonica and KPN, we
believe European CEOs are no longer daunted by government bureaucracies. A
sustained level of mergers and acquisitions activity should be a positive factor
for the European stock markets.
We believe the Japanese government and the Japanese central bank both appreciate
how
------------------------
LOOKING FORWARD,
WE SEE LITTLE
LIKELIHOOD OF A
STOCK MARKET CRASH
BUT DO EXPECT MORE
TURBULENCE AHEAD.
------------------------
[SIDENOTE]
FUND
HIGHLIGHTS
- The Fund returned 34.38% for the six months ended April 30, 2000, compared
with a 6.72% return for its benchmark, the MSCI EAFE Index.(1), *
- This strong performance was primarily the result of our emphasis on
technology, media, and telecommunications stocks. Our emphasis on intensive
research to identify high-quality companies was also particularly helpful
during market volatility.
- We increased our weighting in attractively valued old economy stocks.
--------------------------------------------------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
AS OF 4-30-00
<TABLE>
<S> <C>
1-year 69.09%
Since Inception 43.18%
(on 6-30-98)
</TABLE>
Please keep in mind that high double-digit returns are highly unusual and cannot
be sustained. Investors should also be aware that recent returns were primarily
achieved during favorable market conditions, especially within the technology
sector. Recent stock market fluctuations emphasize that equity funds can be
volatile investments. They should only be considered for long-term investment
goals.
--------------------------------------------------------------------------------
FIVE LARGEST
INVESTMENTS BY COUNTRY
BASED ON NET ASSETS AS OF 4-30-00
<TABLE>
<CAPTION>
COUNTRY % OF NET ASSETS
----------------------------------
<S> <C>
Japan 17.0%
United Kingdom 13.6%
Netherlands 9.0%
Canada 7.8%
Hong Kong 7.7%
</TABLE>
Please see the Schedule of Investments in Securities for a complete listing of
the Fund's portfolio.
--------------------------------------------------------------------------------
(1) Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change while
total return reflects aggregate change, and is not annualized.
8
<PAGE>
important a rising stock market is to lifting the country out of its ten
years of recession. The Japanese government has spent $200 billion to pump up
the economy over the past 18 months--and a relapse would cost much more than
that.
Looking forward, we see little likelihood of a stock market crash but do expect
more turbulence ahead. Therefore, we have reduced the risk profile of the
portfolio by holding on to high-quality issues and increasing exposure to a few
old economy stocks that seem to have been oversold.
Thank you for your investment in the Strong Overseas Fund. We are dedicated to
pursuing investment opportunities around the globe.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 6-30-98 TO 4-30-00
[GRAPH]
<TABLE>
<CAPTION>
The Strong Lipper
Overseas Fund MSCI EAFE International Fund
<S> <C> <C> <C>
Jun 98 $10,000 $10,000 $10,000
Aug 98 $9,290 $8,850 $8,693
Dec 98 $10,460 $10,351 $9,728
Apr 99 $11,420 $10,920 $10,312
Aug 99 $12,800 $11,122 $10,716
Dec 99 $20,530 $13,142 $13,409
Apr 00 $19,310 $12,437 $12,636
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Morgan Stanley Capital International Europe, Australasia, and Far East Index
("MSCI EAFE") and the Lipper International Funds Index. Results include the
reinvestment of all dividends and capital gains distributions. Performance is
historical and does not represent future results. Investment returns and
principal value vary, and you may have a gain or loss when you sell shares.
--------------------------------------------------------------------------------
[SIDENOTE]
YOUR FUND'S
APPROACH
THE STRONG OVERSEAS FUND SEEKS CAPITAL GROWTH. THE FUND INVESTS IN STOCKS FROM
TEN OR MORE FOREIGN COUNTRIES. THE MANAGER SEEKS STOCKS THAT APPEAR TO HAVE
STRONG GROWTH POTENTIAL RELATIVE TO THEIR RISK USING A THREE-STEP INVESTMENT
PROCESS INVOLVING COUNTRY ALLOCATION, INTENSIVE IN-HOUSE RESEARCH, AND CURRENCY
MANAGEMENT. THE MANAGER EXAMINES THE ECONOMIC OUTLOOK OF INDIVIDUAL COUNTRIES IN
DETERMINING WHETHER TO INVEST AND CHOOSES INDIVIDUAL STOCKS BASED ON RIGOROUS,
IN-DEPTH ANALYSIS, WHICH MAY INCLUDE INTERVIEWS WITH COMPANY LEADERS. AT TIMES,
THE FUND MAY TAKE LARGER POSITIONS IN COMPANIES AND COUNTRIES THAT MAY PRESENT
GREATER POTENTIAL INVESTMENT OPPORTUNITIES.
--------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
- The Lipper International Funds Index posted a return of 13.57% for the six
months ended April 30, 2000.*
- Over the past six months, western Europe led the international markets,
though interest-rate fears dampened western Europe's performance somewhat.
The new currency, the Euro, continued to depreciate against the U.S. dollar,
and the European Central Bank was forced to raise interest rates to defend
the new currency.
- The Japanese market simply treaded water over the past six months as positive
and negative factors offset each other.
- Asia (outside Japan) was more influenced by U.S. interest rates than were
other regions.
--------------------------------------------------------------------------------
* The MSCI EAFE is an unmanaged index generally representative of major overseas
stock markets. MSCI EAFE data is U.S. dollar adjusted. The Lipper
International Funds Index is an equally-weighted performance index of the
largest qualifying funds in this Lipper category. Source of the MSCI index
data is Standard & Poor's Micropal. Source of the Lipper index data is Lipper
Inc.
9
<PAGE>
THE STRONG GLOBAL HIGH-YIELD BOND FUND
--------------------------------------
--------------------------------------------------------------------------------
PERSPECTIVES
FROM THE MANAGER
/s/ John T. Bender
John T. Bender
Portfolio Manager
For the six months ended April 30, the Global High-Yield Bond Index returned
9.42%, and the U.S.-based Merrill Lynch High Yield Master II Index returned
0.25%.* Clearly, there was great disparity between these markets and the U.S.
high-yield market. Because we overweighted U.S. high-yield debt, the steep
underperformance of the U.S. high-yield market relative to emerging markets was
the primary cause of the Fund's underperformance during the period.
A number of factors worked in concert to hurt the domestic high-yield sector.
Rising short-term interest rates, driven largely by the Fed's continued rate
hikes, played a leading role, as did rising default rates. It appears that
investors have become less certain that the economic expansion and strong
earnings growth experienced in recent years will continue. In addition, the rise
in the percentage of defaults to 5.44% has caused some concern that credit
quality is deteriorating faster than expected.
Emerging markets have been virtually immune to these events. Investors generally
believe that emerging economies suffered their correction in 1998 and are now
experiencing a strong recovery in growth. This positive view on emerging
economies has been supported by upgrades of debt from Brazil, Mexico, and Korea
in recent months.
The Fund's performance was also hurt by the decline in credit quality of one of
our domestic holdings. Earlier this year, AP Holdings posted disappointing
corporate earnings and was subsequently downgraded. In the current
-------------------------
COUNTRY EXPOSURE(5)
AS OF 4-30-00
(% OF NET ASSETS)
Mexico
16.0%
---
Argentina
9.1%
---
Bermuda
6.1%
---
South Korea
5.8%
---
Canada
3.4%
-------------------------
[SIDENOTE]
FUND
HIGHLIGHTS
- The Strong Global High-Yield Bond Fund returned -0.30% during the six months
ended April 30, 2000 while the Global High-Yield Bond Index returned
9.42%.(1), *
- Emerging-market debt outperformed U.S. high-yield debt by a wide margin over
the period, as monetary tightening coupled with a decline in corporate credit
fundamentals took a more direct toll on the domestic market.
- We maintained an overweighting in domestic high-yield credits relative to
emerging-market credits throughout the six-month period.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AVERAGE ANNUAL
TOTAL RETURNS(1)
AS OF 4-30-00
<S> <C>
1-year -3.45%
Since Inception 0.04%
(on 1-31-98)
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PORTFOLIO STATISTICS
AS OF 4-30-00
<S> <C>
--------------------------------
30-day annualized
yield(2) 7.30%
--------------------------------
Average
credit quality(3) BBB
Average maturity(4) 4.5 years
</TABLE>
--------------------------------------------------------------------------------
(1) Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change while
total return reflects aggregate change, and is not annualized.
(2) Yields are historical and do not represent future yields, which will
fluctuate. Yield is as of 4-28-00.
(3) For the purposes of the average, the Fund's short-term debt obligations have
been assigned a long-term rating by the Advisor.
(4) The Fund's average maturity includes the effect of futures.
(5) Please see the Schedule of Investments in Securities for a complete listing
of the Fund's portfolio. Exposure is calculated based on the sum of total
market value of securities and market value of futures. Country exposure
does not reflect U.S. holdings.
10
<PAGE>
environment, bonds that disappoint investors have tended to decline more rapidly
than in the past, and AP Holdings debt was no exception.
After the sector's recent underperformance, U.S. high-yield is very attractively
valued. We, therefore, intend to maintain our overweighting in domestic
high-yield bonds, as it appears some prices in the U.S. high-yield market have
been beaten down excessively, reflecting a greater decline in credit quality
than is likely to occur. On the other hand, emerging-market debt may
underperform going forward as the Fed continues to raise interest rates.
Emerging economies are very dependent on U.S. demand, so if consumption in the
U.S. slows--a strong possibility if the Fed succeeds in slowing U.S. economic
growth--it will be difficult for emerging economies to maintain their current
levels of exports. High export levels have been a driving force for many of the
credit upgrades recently seen in some of these countries, and if they decline,
some of those improvements in credit quality may prove short lived.
As you have been notified, the Fund's board of directors has approved the merger
of the Fund into the Strong High-Yield Bond Fund later this year. We thank you
for your continued investment in the Strong Global High-Yield Bond Fund.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 1-31-98 TO 4-30-00
[GRAPH]
<TABLE>
<CAPTION>
The Strong Global Global High-Yield Lipper Global
High-Yield Bond Fund Bond Index Income Fund
<S> <C> <C> <C>
Jan 98 $10,000 $10,000 $10,000
Apr 98 $10,437 $10,435 $10,209
Aug 98 $9,107 $8,022 $9,844
Dec 98 $9,683 $9,106 $10,555
Apr 99 $10,368 $9,949 $10,483
Aug 99 $9,809 $9,633 $10,191
Dec 99 $10,237 $10,686 $10,265
Apr 00 $10,010 $10,996 $10,107
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Global High-Yield Bond Index and the Lipper Global Income Funds Index. Results
include the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares.
--------------------------------------------------------------------------------
[SIDENOTE]
YOUR FUND'S
APPROACH
THE STRONG GLOBAL HIGH-YIELD BOND FUND SEEKS TOTAL RETURN BY INVESTING FOR A
HIGH LEVEL OF CURRENT INCOME AND CAPITAL GROWTH. THE FUND INVESTS PRIMARILY IN
MEDIUM- AND LOWER-QUALITY BONDS OF U.S. AND FOREIGN ISSUERS. THE FUND WILL
NORMALLY MAINTAIN AN AVERAGE MATURITY OF SEVEN TO TWELVE YEARS. THE FUND'S
MANAGER LOOKS FOR HIGH-YIELD BONDS THAT HAVE THE POTENTIAL TO IMPROVE THEIR
CREDIT QUALITY AND THAT MAY BENEFIT FROM CHANGES IN INTEREST AND
CURRENCY-EXCHANGE RATES. THE MANAGER INTENDS TO ATTEMPT TO LIMIT THE FUND'S
EXPOSURE TO FOREIGN CURRENCY RISK BY USING HEDGING STRATEGIES.
--------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
- Strong economic growth and sound fiscal policy decisions in Mexico and Brazil
led to upgrades in those countries' credit ratings. Progress on debt
restructuring and a successful political transition in Russia allowed that
nation's debt to recover a portion of its losses.
- The Federal Reserve Board raised the federal funds rate by 75 basis points
over the six-month period in response to strong U.S. economic growth and
rising inflation.
- The variance in returns across industries has been extreme. Credits that
reported bad news have experienced larger price declines than they have
historically under similar circumstances.
--------------------------------------------------------------------------------
*The Global High-Yield Bond Index is comprised of 65% J. P. Morgan Emerging
Markets Bond Index + and 35% Lehman Brothers High-Yield Bond Index. The J. P.
Morgan Emerging Markets Bond Index + is an unmanaged index generally
representative of emerging market debt obligations. The Lehman Brothers
High-Yield Bond Index is an unmanaged index generally representative of
corporate bonds rated below investment-grade. The Lipper Global Income Funds
Index is an equally weighted performance index of the largest qualifying funds
in this Lipper category. The Merrill Lynch High Yield Master II Index is an
unmanaged index generally representative of corporate bonds rated below
investment-grade. Source of the Global High-Yield Bond Index data is Standard &
Poor's Micropal. Source of the Lipper index data is Lipper Inc. Source of the
Merrill Lynch index data is Bloomberg.
11
<PAGE>
THE STRONG INTERNATIONAL BOND FUND
----------------------------------
--------------------------------------------------------------------------------
PERSPECTIVES
FROM THE MANAGERS
/s/ John T. Bender /s/ Bradley C. Tank
John T. Bender Bradley C. Tank
Portfolio Co-manager Portfolio Co-manager
The six-month period ended April 30 was characterized by stronger economic
growth and rising global interest rates. The U.S. continued its record
expansion, and the European economic recovery began to gain momentum. Both the
U.S. Fed and the European Central Bank (ECB) acted to increase their benchmark
rates in response to the increasing economic growth and inflationary pressures.
In Japan, the economy continued to focus on exporting its way to recovery. The
rebound in world growth helped generate strong export demand during the period.
However, for this to be effective in the future, it will require a weak yen.
During the period, the U.S. dollar continued to appreciate versus most major
currencies as U.S. economic growth continued to outpace other major economies.
Because this Fund does not necessarily hedge for foreign currency exposure, an
appreciating U.S. dollar has a negative impact on portfolio returns.
For most of the six months, we underweighted the euro. We did, however, recently
remove this underweighting as the euro appears to be fairly valued at current
prices. The Fund also benefited from investments in energy companies such as R&B
Falcon and Triton Energy. These corporate bonds provided attractive total
returns to the Fund despite the difficult corporate market, as their credit
fundamentals improved significantly during the period.
-------------------------
COUNTRY EXPOSURE(5)
AS OF 4-30-00
(% OF NET ASSETS)
Japan
26.6%
---
United Kingdom
25.7%
---
Germany
23.9%
---
Italy
10.9%
---
Denmark
8.0%
-------------------------
--------------------------------------------------------------------------------
[SIDENOTE]
FUND
HIGHLIGHTS
- The Strong International Bond Fund returned -7.12% during the six months ended
April 30, 2000. Its benchmark, the Salomon Smith Barney Non-U.S. World
Government Bond Index (Currency Unhedged), returned -6.86% during the same
period.(1), *
- The Fund's negative return was largely due to a strengthening U.S. dollar. The
dollar appreciated approximately 14% versus the euro.
- The Fund reduced its duration early in the period as signs of stronger
economic growth materialized.
- A modest underweighting of the euro during its rapid decline protected the
Fund from a further decline in price. Also, an overweighting in
short-maturity, high-yield corporate bonds in the energy sector increased the
Fund's income and provided a modest boost to performance.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AVERAGE ANNUAL
TOTAL RETURNS(1)
AS OF 4-30-00
<S> <C>
1-year -7.64%
3-year 0.99%
5-year 1.26%
Since Inception 4.92%
(on 3-31-94)
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PORTFOLIO STATISTICS
AS OF 4-30-00
<S> <C>
--------------------------------
30-day annualized
yield(2) 4.16%
--------------------------------
Average
credit quality(3) AA
Average maturity(4) 5.8 years
</TABLE>
--------------------------------------------------------------------------------
(1) Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change while
total return reflects aggregate change, and is not annualized.
(2) Yields are historical and do not represent future yields, which will
fluctuate. Yield is as of 4-28-00.
(3) For purposes of this average rating, the Fund's short-term debt obligations
have been assigned a long-term rating by the Advisor.
(4) The Fund's average maturity includes the effect of futures.
12
<PAGE>
We shortened the Fund's duration early in the period as inflationary pressures
began to arise. Currently, the Fund is neutral relative to its benchmark in
interest-rate and currency exposure.
Going forward, we anticipate higher global interest rates. Further monetary
tightening in the U.S. and Europe is likely as part of continued efforts to curb
inflation. In Japan, we don't expect any changes in the central bank's policy.
Their benchmark rate is likely to remain near zero. Some volatility in the
currency markets can be expected going forward as investors will continue to
question the credibility of the euro as a major currency.
Given this environment, we intend to maintain interest-rate and currency
exposures that are near the benchmark. Yields on short-maturity corporate and
mortgage issues are extremely attractive, and we plan to maintain an overweight
in these sectors. Our intensive credit research will continue to be a
cornerstone of our efforts to identify bonds with the potential to offer
attractive yields and superior price performance.
Thank you for your investment in the Strong International Bond Fund.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 3-31-94 TO 4-30-00
[GRAPH]
<TABLE>
<CAPTION>
Salamon Smith Barney
The Strong Non-U.S. World Government Lipper International
International Bond Fund Bond Index (Currency Unhedged) Income Funds Index
<S> <C> <C> <C>
Mar 94 $10,000 $10,000 $10,000
Dec 94 $10,866 $10,397 $9,837
Dec 95 $12,937 $12,430 $11,700
Dec 96 $13,966 $12,937 $12,784
Dec 97 $13,297 $12,385 $12,991
Dec 98 $15,329 $14,589 $14,725
Dec 99 $14,192 $13,849 $14,067
Apr 00 $13,394 $13,091 $13,613
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Salomon Smith Barney Non-U.S. World Government Bond Index (Currency
Unhedged) and the Lipper International Income Funds Index. Results include
the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares.
--------------------------------------------------------------------------------
[SIDENOTE]
YOUR FUND'S
APPROACH
THE STRONG INTERNATIONAL BOND FUND SEEKS HIGH TOTAL RETURN BY INVESTING FOR BOTH
INCOME AND CAPITAL GROWTH. THE FUND INVESTS PRIMARILY IN HIGHER- AND
MEDIUM-QUALITY BONDS ISSUED IN FOREIGN COUNTRIES. THE FUND MAY ALSO INVEST UP TO
35% OF ITS ASSETS IN LOWER-QUALITY, HIGH-YIELD BONDS. THE FUND MAINTAINS AN
AVERAGE MATURITY OF FOUR TO NINE YEARS. TO SELECT BONDS, THE FUND'S MANAGERS
FIRST LOOK AT OVERALL TRENDS IN THE GLOBAL ECONOMY. THE MANAGERS THEN EXAMINE
THE COUNTRIES, SECTORS, AND INDIVIDUAL COMPANIES THAT MAY BENEFIT FROM THOSE
TRENDS. THE MANAGERS MAY CREATE SYNTHETIC BONDS TO MAKE INVESTMENTS CONSISTENT
WITH THE FUND'S STRATEGY AND GOALS.
--------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
- World economic growth strengthened during the period, leading many central
banks to pursue more aggressive monetary policies.
- The Bank of Japan left its benchmark refinancing rate at essentially zero in
an attempt to stimulate local demand.
- The Euro continued to struggle versus most major currencies as investors began
to question the credibility of the European Central Bank. It has now
depreciated over 22% versus the U.S. dollar since its inception on January 1,
1999.
--------------------------------------------------------------------------------
(5) Please see the Schedule of Investments in Securities for a complete listing
of the Fund's portfolio. Exposure is calculated based on the sum of total
market value of securities and market value of futures. Country exposure
does not reflect U.S. holdings.
* The Salomon Smith Barney Non-U.S. World Government Bond Index (Currency
Unhedged) is an unmanaged index generally representative of liquid, non-U.S.
fixed income government securities. This index disregards the effects of
foreign currency fluctuations. The Lipper International Income Funds Index
is an equally-weighted performance index of the largest qualifying funds in
this Lipper category. Source of the Salomon index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
13
<PAGE>
THE STRONG SHORT-TERM GLOBAL BOND FUND
--------------------------------------
PERSPECTIVES
FROM THE MANAGERS
/s/ Jeffery A. Koch /s/ Bradley C. Tank
Jeffrey A. Koch Bradley C. Tank
Portfolio Co-manager Portfolio Co-manager
Prices of short-term bonds are heavily influenced by changes in monetary policy.
Therefore, short-term yields rose over the six-month period as many central
banks implemented aggressive monetary policies over the period. Their efforts
were aimed at restraining inflationary pressures and calming economic growth.
We believe the central banks will continue their aggressive policies by raising
short-term interest rates over the next six months. One notable exception is
Japan, where we expect the benchmark rate to remain near zero.
The Fund's focus on the corporate and mortgage sectors, as well as excellent
issue selection, led to the Fund's outperformance relative to its benchmark. We
continued to focus on short-maturity corporate and mortgage debt to provide the
Fund with extra income. In addition, our intensive research allowed us to select
both corporate and mortgage securities that outperformed the market. Some
examples include Triton Energy and R & B Falcon in the energy sector.
The Fund managed to escape most of the weakness in the corporate bond sector
because of its short-term emphasis. When the U.S. Treasury announced a plan to
buy back $30 billion in long-maturity debt, the increase in demand pushed the
prices of long-maturity Treasuries higher. As long Treasuries, therefore, became
more attractive than longer-term corporate debt, the result was significant
-------------------------
COUNTRY EXPOSURE(5)
AS OF 4-30-00
(% OF NET ASSETS)
Germany
7.7%
---
United Kingdom
5.6%
---
Canada
2.1%
---
Australia
1.7%
---
New Zealand
0.5%
-------------------------
--------------------------------------------------------------------------------
[SIDENOTE]
FUND
HIGHLIGHTS
- The Strong Short-Term Global Bond Fund returned 2.20% during the six months
ended April 30, 2000. Its benchmark, the Salomon Smith Barney 1-3 Year World
Government Bond Index (Currency Hedged), returned 0.56% during the same
period.(1), *
- The Fund maintained its overweighting in the U.S. corporate and mortgage
sectors in order to provide a higher level of income.
- Intensive credit research enabled us to select corporate and mortgage
securities that outperformed the market. Individual security selection was the
primary driver of the Fund's superior return relative to its benchmark.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AVERAGE ANNUAL
TOTAL RETURNS(1)
AS OF 4-30-00
<S> <C>
1-year 4.68%
3-year 5.15%
5-year 7.15%
Since Inception 7.15%
(on 3-31-94)
</TABLE>
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PORTFOLIO STATISTICS
AS OF 4-30-00
<S> <C>
--------------------------------
30-day annualized
yield(2) 6.03%
--------------------------------
Average
credit quality(3) AA
Average maturity(4) 1.3 years
</TABLE>
--------------------------------------------------------------------------------
(1) Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of all dividends and
capital gains. Average annual total return reflects annualized change while
total return reflects aggregate change, and is not annualized.
(2) Yields are historical and do not represent future yields, which will
fluctuate. Yield is as of 4-28-00.
(3) For the purposes of the average, the Fund's short-term debt obligations have
been assigned a long-term rating by the Advisor.
(4) The Fund's average maturity includes the effect of futures.
14
<PAGE>
underperformance for long-term corporate issues. However, shorter-term corporate
debt wasn't strongly affected. The majority of the corporate sector's
underperformance can be attributed to the decline in longer-term corporate
bonds, which have little influence on this short-term fund.
Yields on short-maturity corporate and mortgage debt are the highest they have
been in recent years. We believe these higher yields provide adequate protection
against further increases in short-term interest rates. Going forward, we expect
to increase our interest-rate exposure once it becomes apparent that central
banks have finished raising short-term interest rates.
Thank you for your investment in the Strong Short-Term Global Bond Fund. We
appreciate the confidence you've placed in us.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
FROM 3-31-94 TO 4-30-00
[GRAPH]
<TABLE>
<CAPTION>
Salamon Smith Barney Lipper Short
The Strong Short-Term 1-3 Year World Government World Multi-Market
Global Bond Fund Bond Index (Currency Unhedged) Income Funds Average
<S> <C> <C> <C>
Mar 94 $10,000 $10,000 $10,000
Dec 94 $10,513 $10,153 $9,739
Dec 95 $11,612 $11,286 $10,563
Dec 96 $12,775 $12,088 $11,252
Dec 97 $13,629 $12,856 $11,616
Dec 98 $14,184 $13,796 $12,335
Dec 99 $15,003 $14,372 $12,451
Apr 00 $15,220 $14,345 $12,420
</TABLE>
This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Salomon Smith Barney 1-3 Year World Government Bond Index (Currency Hedged)
and the Lipper Short World Multi-Market Income Funds Average. Results
include the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares.
--------------------------------------------------------------------------------
[SIDENOTE]
YOUR FUND'S
APPROACH
THE STRONG SHORT-TERM GLOBAL BOND FUND SEEKS TOTAL RETURN BY INVESTING FOR A
HIGH LEVEL OF INCOME WITH A LOW DEGREE OF SHARE-PRICE FLUCTUATION. THE FUND
INVESTS PRIMARILY IN HIGHER- AND MEDIUM-QUALITY BONDS FROM U.S. AND FOREIGN
ISSUERS. THE FUND MAY ALSO INVEST UP TO 35% OF ITS ASSETS IN LOWER-QUALITY,
HIGH-YIELD BONDS. UNDER NORMAL CONDITIONS, THE FUND MAINTAINS AN AVERAGE
MATURITY OF THREE YEARS OR LESS. THE FUND'S MANAGERS INTEND TO ATTEMPT TO LIMIT
THE FUND'S EXPOSURE TO FOREIGN CURRENCY RISK BY USING HEDGING STRATEGIES.
--------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
- World economic growth strengthened during the period, leading many central
banks to pursue more aggressive monetary policies.
- The U.S. Treasury announced plans to buy back $30 billion of long-maturity
government debt. The resulting reduction in supply led to a modest rally in
long-term rates in the U.S., despite a nearly 90-basis-point increase in
two-year Treasury yields. Short-term rates rose in Europe, though the
increase was not as pronounced as in the United States. Japanese short-term
Treasury yields continue to hover close to zero.
- Corporate bond returns significantly underperformed Treasuries during the
period. However, this underperformance was largely limited to longer-maturity
issues.
--------------------------------------------------------------------------------
(5) Please see the Schedule of Investments in Securities for a complete listing
of the Fund's portfolio. Exposure is calculated based on the sum of total
market value of securities and market value of futures. Country exposure
does not reflect U.S. holdings.
* The Salomon Smith Barney 1-3 Year World Government Bond Index (Currency
Hedged) is an unmanaged index generally representative of short-term, global
fixed income government securities. Rolling one-month forward exchange
contracts are used as the hedging instrument. The Lipper Short World
Multi-Market Income Funds Average represents funds that invest in non-U.S.
dollar and U.S. dollar debt instruments and, by policy, keep a
dollar-weighted average maturity of less than five years. Source of the
Salomon index data is Salomon Smith Barney. Source of the Lipper data is
Lipper Inc.
15
<PAGE>
<TABLE>
<CAPTION>
SCHEDULES OF INVESTMENTS IN SECURITIES April 30, 2000 (Unaudited)
------------------------------------------------------------------------------------
--------------------------------------------------------------------------------
STRONG ASIA PACIFIC FUND
--------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS 93.9%
Australia 18.9%
BMCMedia.com, Ltd. (b) 852,106 $ 1,005,040
The Broken Hill Proprietary Company, Ltd. 144,980 1,561,017
emitch, Ltd. (b) 1,400,000 515,000
FXF Trust (b) 3,310,000 1,195,652
IBA Technologies, Ltd. (b) 800,000 593,242
John Fairfax Holdings, Ltd. 420,000 1,213,928
MIM Holdings, Ltd. 2,309,044 1,119,048
Normandy Mining, Ltd. 1,030,000 511,204
North, Ltd. 800,000 1,375,668
Novogen, Ltd. (b) 700,000 1,414,206
Oil Search, Ltd. (b) 1,237,000 1,119,541
Publishing & Broadcasting, Ltd. 290,000 2,252,102
Securenet, Ltd. (b) 125,000 372,236
Sydney Aquarium, Ltd. 413,450 989,795
WMC, Ltd. 650,000 2,698,494
Woodside Petroleum, Ltd. 277,000 1,712,830
-----------
19,649,003
China 2.0%
China Merchants Hai Hong Holdings 1,600,000 996,328
Martin Currie China Heartland Fund, Ltd. (b) 118,000 1,062,000
-----------
2,058,328
Hong Kong 6.4%
Cheung Kong Holdings, Ltd. 102,000 1,217,934
Dickson Concepts International, Ltd. 1,398,000 1,355,173
Hing Kong Holdings, Ltd. 4,000,000 672,778
Hutchison Whampoa, Ltd. 75,000 1,092,944
Legend Holdings, Ltd. 350,000 406,684
South China Morning Post Holdings, Ltd. 1,300,000 1,377,012
Timeless Software, Ltd. (b) (d) 1,100,000 586,113
-----------
6,708,638
India 4.2%
HCL Technologies, Ltd. (b) 20,000 738,532
India Fund, Inc. (b) 70,000 1,001,875
Indian Hotels Company, Ltd. 50 270
The Indian Smaller Companies Fund, Ltd. (b) 30,792 650,943
Pentamedia Graphics, Ltd. 47,810 696,864
Reliance Industries, Ltd. 300 2,387
SSI, Ltd. 8,000 487,064
Television Eighteen India, Ltd. (b) 32,750 471,232
UTI-Mastergrowth 93 Fund 732,400 369,560
-----------
4,418,727
Japan 24.1%
AVEX, Inc. 10,100 1,392,008
Credit Suisse Warrants, Expire 8/01/02 600 900,000
Focus Systems Corporation 27,000 961,521
Fujitsu, Ltd./Macquarie Warrants, Expire 9/17/01 500 387,500
Hitachi Maxell, Ltd. 61,000 1,596,799
Jafco Company, Ltd. 11,000 1,933,216
Kyocera Corporation 19,000 3,175,747
Net One Systems Company, Ltd. 66 2,252,705
The Nikko Securities Company, Ltd. 166,000 1,957,728
Nippon Express Company, Ltd. 328,000 2,069,152
Nomura Securities Company, Ltd. 114,000 2,868,190
Paribas Capital Markets Warrants, Expire 9/21/01 400 620,000
Shobunsha Publications, Inc. 38,000 1,792,619
TOWA Corporation 40,000 1,494,774
Toei Company, Ltd. 239,000 1,680,141
-----------
25,082,100
Malaysia 4.3%
Berjaya Sports Toto BHD 212,000 443,550
Genesis Malaysia Maju Fund, Ltd. (b) 32,000 752,000
Malaysia International Shipping BHD (Fgn Reg) 188,000 282,015
Sime Darby BHD 261,000 306,348
World Equity Benchmark Shares -
Malaysia Index Series 440,000 2,695,000
-----------
4,478,913
<CAPTION>
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
New Zealand 4.3%
Advantage Group, Ltd. (b) 524,000 $ 927,802
Guinness Peat Group PLC 1,141,610 719,933
Montana Group NZ, Ltd. 975,000 945,945
Sky City, Ltd. 286,000 872,666
Sky Network Television, Ltd. (b) 527,716 1,049,580
-----------
4,515,926
Philippines 1.1%
Philippine Long Distance Telephone Company 63,000 1,129,908
Singapore 13.5%
City Developments, Ltd. 420,000 1,907,189
DBS Group Holdings, Ltd. 166,247 2,289,099
First Capital Corporation, Ltd. 2,430,000 2,434,699
G.K. Goh Holdings, Ltd. 880,000 497,568
Hong Leong Finance, Ltd. (Fgn Reg) 984,000 1,447,144
NatSteel, Ltd. 1,050,000 2,571,629
Neptune Orient Lines, Ltd. (b) 2,050,000 1,837,757
Sembcorp Logistics, Ltd. 175,000 1,086,893
-----------
14,071,978
South Korea 3.5%
Digital Chosun Company, Ltd. (b) 9,852 852,449
Hite Brewery Company, Ltd. 39,500 1,121,451
L.G. Securities Company 87,102 824,309
Opicom Company, Ltd. (b) 26,350 802,731
SK Global Company, Ltd. 1,540 18,044
-----------
3,618,984
Taiwan 4.2%
Acer, Inc. (b) 312,000 654,260
Asustek Computer, Inc. 79,000 877,490
Procomp Informatics Company, Ltd. (b) 144,000 1,132,372
Taiwan Opportunities Fund, Ltd. (b) 105,000 1,719,900
-----------
4,384,022
Thailand 6.3%
KCE Electronics PCL (Fgn Reg) (b) 489,260 1,606,871
Kiatnakin Finance PCL (b) 2,205,000 1,738,045
National Petrochemical PCL (Fgn Reg) 995,000 1,045,717
PTT Exploration and Production PCL (Fgn Reg) 303,000 1,536,495
Royal Garden Resort PCL Warrants,
Expire 5/18/05 43,400 0
Southeast Asia Frontier Fund LP (b) 74,000 592,000
-----------
6,519,128
United States 1.1%
AsiaInfo Holdings, Inc. (b) 27,000 1,174,500
---------------------------------------------------------------------------------
Total Common Stocks (Cost $103,535,301) 97,810,155
---------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS (a) 5.0%
Commercial Paper 0.0%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call
Deposit, 5.00% $ 56,000 56,000
Time Deposits 5.0%
United States
Wachovia Winston Grand Cayman,
5.85%, Due 5/01/00 5,200,000 5,200,000
---------------------------------------------------------------------------------
Total Short-Term Investments (Cost $5,256,000) 5,256,000
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Total Investments in Securities (Cost $108,791,301) 98.9% 103,066,155
Other Assets and Liabilities, Net 1.1% 1,139,555
---------------------------------------------------------------------------------
NET ASSETS 100.0% $104,205,710
=================================================================================
</TABLE>
16
<PAGE>
--------------------------------------------------------------------------------
STRONG FOREIGN MAJORMARKETS FUNDS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS 96.8%
Australia 2.7%
National Australia Bank, Ltd. 1,001 $ 13,712
TABCORP Holdings, Ltd. 15,400 82,421
-----------
96,133
Belgium 0.2%
Fortis (B) 320 8,101
Canada 3.7%
Clearnet Communications, Inc. Class A (b) 1,000 42,233
Rogers Communications, Inc. Class B (b) 1,500 39,074
Shaw Communications, Inc. Class B 2,100 49,169
-----------
130,476
Finland 5.2%
Nokia Corporation Sponsored ADR 1,200 68,250
Nokia Oyj 2,040 117,345
-----------
185,595
France 9.0%
Banque Nationale de Paris 500 40,521
L'OREAL 20 13,601
Lagardere S.C.A. 700 47,540
NRJ SA 40 25,962
Societe Generale 300 62,299
Societe Television Francaise 1 90 61,779
Thomson Multimedia (b) 500 49,226
Vivendi SA 196 19,440
-----------
320,368
Germany 3.7%
Adidas-Salomon AG 400 25,233
Infineon Technologies AG Sponsored ADR (b) 700 47,512
Siemens AG 410 60,661
-----------
133,406
Hong Kong 8.3%
China (Hong Kong) Telecom, Ltd. (b) 4,000 28,888
Hutchison Whampoa, Ltd. 2,000 29,145
Johnson Electric Holdings, Ltd. 8,900 71,704
Legend Holdings, Ltd. 64,000 74,365
Li & Fung, Ltd. 24,000 92,750
-----------
296,852
India 1.4%
Infosys Technologies, Ltd. 100 18,578
Zee Telefilms, Ltd. 2,000 32,569
-----------
51,147
Italy 4.3%
Bipop-Carire Spa 600 54,680
Mediaset Spa 1,800 29,782
Mediolanum Spa 2,400 39,858
Telecom Italia Mobile Spa 3,090 29,591
-----------
153,911
Japan 16.5%
Daiwa Securities Group, Inc. 9,000 137,360
Fuji Television Network, Inc. 6 99,898
Fujitsu, Ltd. 1,000 28,305
Keyence Corporation 110 36,477
NTT DoCoMo, Inc. 1 33,392
Nippon Television Network Corporation 100 74,517
Nomura Securities Company, Ltd. 3,000 75,479
Rohm Company, Ltd. 100 33,484
Sony Corporation (b) 400 46,082
Sony Corporation Sponsored ADR 100 22,563
-----------
587,557
Malaysia 0.4%
Telekom Malaysia BHD 4,000 13,895
<CAPTION>
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
Mexico 3.0%
Fomento Economico Mexicano SA de CV
Sponsored ADR 1,200 $ 49,500
Telefonos de Mexico SA Sponsored ADR 1,000 58,813
-----------
108,313
Netherlands 9.6%
ASM Lithography Holding NV (b) 3,600 142,317
Koninklijke Philips Electronics NV 800 35,700
STMicroelectronics NV 720 136,774
Verenigde Nederlandse Uitgeversbedrijven NV 500 26,824
-----------
341,615
New Zealand 0.1%
Telecom Corporation of New Zealand, Ltd. 460 1,941
Singapore 1.5%
Singapore Airlines, Ltd. 2,000 20,742
Singapore Press Holdings, Ltd. 1,600 31,312
-----------
52,054
Spain 2.7%
Banco Santander Central Hispano SA 5,740 60,018
Telefonica SA (b) 1,621 36,174
-----------
96,192
Sweden 3.7%
Skandia Forsakrings AB 1,390 66,822
Telefonaktiebolaget LM Ericsson (b) 730 65,198
-----------
132,020
Switzerland 4.1%
Adecco SA 100 82,416
Adecco SA Sponsored ADR 400 41,675
UBS AG 90 22,147
-----------
146,238
United Kingdom 16.7%
BP Amoco PLC Sponsored ADR 1,800 91,800
British Aerospace PLC 5,700 34,621
British Airways PLC Sponsored ADR 700 36,838
British Telecommunications PLC Sponsored ADR 200 36,600
Energis PLC (b) 1,300 63,880
GKN PLC 3,100 42,685
Lloyds TSB Group PLC 5,800 56,479
SmithKline Beecham PLC 7 95
Vodafone AirTouch PLC 16,043 72,439
Vodafone AirTouch PLC Sponsored ADR 1,600 75,200
WPP Group PLC 5,300 84,976
-----------
595,613
---------------------------------------------------------------------------------
Total Common Stocks (Cost $3,164,752) 3,451,427
---------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS (a) 4.7%
Commercial Paper 1.6%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call
Deposit, 5.00% $ 56,000 56,000
Government & Agency Issues 0.3%
United States
United States Treasury Bills, Due 5/04/00 (c) 10,000 9,996
Time Deposits 2.8%
United States
Bank of Scotland, 6.00%, Due 5/01/00 100,000 100,000
---------------------------------------------------------------------------------
Total Short-Term Investments (Cost $165,883) 165,996
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Total Investments in Securities (Cost $3,330,635) 101.5% 3,617,423
Other Assets and Liabilities, Net (1.5%) (54,297)
---------------------------------------------------------------------------------
NET ASSETS 100.0% $3,563,126
=================================================================================
</TABLE>
17
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
STRONG FOREIGN MAJOR MARKETS FUNDS (continued)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FUTURES
--------------------------------------------------------------------------------
Underlying
Face Amount Unrealized
Expiration Date at Value Appreciation
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Purchased:
2 CAC 40 Euro Index 6/00 $117,129 $29
</TABLE>
<TABLE>
<CAPTION>
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
--------------------------------------------------------------------------------
Settlement Unrealized
Date Value in USD Appreciation
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Sold:
21,500,000 JPY 5/10/00 $199,298 $95
</TABLE>
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
STRONG INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCKS 99.8%
Australia 2.4%
TABCORP Holdings, Ltd. 804,000 $ 4,303,030
Canada 8.6%
Celestica, Inc. (b) 37,800 2,062,463
Nortel Networks Corporation 82,400 9,331,800
Rogers Communications, Inc. Class B (b) 77,200 2,010,987
Shaw Communications, Inc. Class B 86,900 2,034,654
-----------
15,439,904
Egypt 0.0%
Suez Cement 300 3,936
Finland 7.5%
Nokia Oyj 232,800 13,391,112
France 5.6%
Banque Nationale de Paris 17,400 1,410,118
Lagardere S.C.A. 27,600 1,874,432
NRJ SA 2,100 1,363,024
Societe Generale 5,194 1,078,599
Societe Television Francaise 1 4,000 2,745,739
Thomson Multimedia (b) 16,000 1,575,245
-----------
10,047,157
Germany 2.8%
Adidas-Salomon AG 25,400 1,602,301
EM.TV & Merchandising AG 15,900 1,232,027
Infineon Technologies AG ADR (b) 33,200 2,253,450
-----------
5,087,778
Hong Kong 7.2%
China Telecom, Ltd. (b) 124,000 895,540
Hutchison Whampoa, Ltd. 176,000 2,564,774
Johnson Electric Holdings, Ltd. 378,000 3,045,413
Legend Holdings, Ltd. 1,806,000 2,098,490
Li & Fung, Ltd. 1,134,000 4,382,482
-----------
12,986,699
India 5.6%
Asian Hotels, Ltd. 150 368
ICICI, Ltd. Sponsored ADR 76,500 1,836,000
Indian Hotels Company, Ltd. 2,050 11,054
Infosys Technologies, Ltd. 32,558 6,048,619
UTI-Mastergrowth 93 Fund 37,600 18,972
WIPRO, Ltd. 14,735 1,125,622
Zee Telefilms, Ltd. 60,000 977,064
-----------
10,017,699
<CAPTION>
--------------------------------------------------------------------------------
STRONG INTERNATIONAL STOCK FUND (continued)
--------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
Ireland 0.4%
Connemara Green Marble Quarries PLC
(Acquired 11/21/96 - 6/20/97;
Cost $635,000) (b) (d) (e) 50,800 $ 635,000
Connemara Green Marble Quarries PLC
Warrants, Expire 9/30/02 (Acquired
11/21/96; Cost $0) (b) (d) (e) 8,000 0
-----------
635,000
Italy 6.5%
Bipop-Carire Spa 54,700 4,984,956
Mediaset Spa 104,800 1,733,973
Mediolanum Spa 210,300 3,492,563
Telecom Italia Mobile Spa 150,600 1,442,200
-----------
11,653,692
Japan 17.9%
Daiwa Securities Group, Inc. 471,000 7,188,512
Fuji Television Network, Inc. 143 2,380,908
Hikari Tsushin, Inc. 3,300 476,182
Keyence Corporation 6,160 2,042,697
Nippon Television Network Corporation 3,600 2,681,889
Nomura Securities Company, Ltd. 178,000 4,478,402
NTT DoCoMo, Inc. 85 2,838,313
Rohm Company, Ltd. 8,000 2,678,753
Sakura Bank, Ltd. 261,000 1,829,969
Takeda Chemical Industries, Ltd. 19,000 1,249,561
Tokyo Electron, Ltd. 27,000 4,398,020
-----------
32,243,206
Mexico 1.8%
Fomento Economico Mexicano SA de CV
Sponsored ADR 28,500 1,175,625
Telefonos de Mexico SA ADR Series L 36,400 2,140,775
-----------
3,316,400
Netherlands 11.0%
ASM Lithography Holding NV (b) 153,900 6,032,695
STMicroelectronics NV 65,600 12,552,222
Verenigde Nederlandse Uitgeversbedrijven NV 21,000 1,126,601
-----------
19,711,518
Portugal 0.7%
Portugal Telecom SA 106,600 1,192,356
Singapore 1.4%
Singapore Press Holdings, Ltd. 126,700 2,479,510
Spain 0.5%
Banco Santander Central Hispano SA 85,696 896,042
Sweden 2.0%
Skandia Forsakrings AB 76,000 3,653,600
Switzerland 0.6%
Adecco SA 1,345 1,108,495
Taiwan 1.3%
Taiwan Semiconductor Manufacturing
Company, Ltd. Sponsored ADR (b) 45,800 2,395,913
United Kingdom 16.0%
BP Amoco PLC Sponsored ADR 83,400 4,253,400
British Aerospace PLC 286,700 1,741,378
British Airways PLC 336,800 1,737,761
Energis PLC (b) 116,700 5,734,465
GKN PLC 143,900 1,981,406
Lloyds TSB Group PLC 144,500 1,407,107
Vodafone AirTouch PLC 1,889,430 8,628,114
WPP Group PLC 207,500 3,326,890
-----------
28,810,521
---------------------------------------------------------------------------------
Total Common Stocks (Cost $109,741,124) 179,373,568
---------------------------------------------------------------------------------
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------
STRONG INTERNATIONAL STOCK FUND (continued)
------------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
SHORT-TERM INVESTMENTS (a) 1.4%
Commercial Paper 0.0%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call
Deposit, 5.00% $ 74,000 $ 74,000
Time Deposits 1.4%
United States
Wachovia Winston Grand Cayman, 5.85%,
Due 5/01/00 2,500,000 2,500,000
---------------------------------------------------------------------------------
Total Short-Term Investments (Cost $2,574,000) 2,574,000
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Total Investments in Securities (Cost $112,315,124) 101.2% 181,947,568
Other Assets & Liabilities, Net (1.2%) (2,222,574)
---------------------------------------------------------------------------------
Net Assets 100.0% $179,724,994
=================================================================================
</TABLE>
<TABLE>
<CAPTION>
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
---------------------------------------------------------------------------------
Unrealized
Settlement Date Value in USD Appreciation
---------------------------------------------------------------------------------
<S> <C> <C> <C>
Sold:
1,097,500,000 JPY 5/10/00 $10,173,454 $1,773
</TABLE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------
STRONG OVERSEAS FUND
------------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
Common Stocks 90.6%
Australia 2.5%
TABCORP Holdings, Ltd. 284,000 $ 1,519,976
Canada 7.8%
Celestica, Inc. (b) 11,900 649,294
Clearnet Communications, Inc. Class A (b) 13,300 561,693
Nortel Networks Corporation 21,400 2,423,550
Rogers Communications, Inc. Class B (b) 12,400 323,008
Shaw Communications, Inc. Class B 29,300 686,023
-----------
4,643,568
Finland 5.0%
Nokia Corporation Sponsored ADR 16,800 955,500
Nokia OYJ 51,920 2,020,171
-----------
2,975,671
France 5.9%
Banque Nationale de Paris 1,200 97,250
Lagardere S.C.A. 8,300 563,688
NRJ SA 760 493,285
Societe Generale 1,496 310,663
Societe Television Francaise 1 1,300 892,365
Thomson Multimedia (b) 11,600 1,142,053
-----------
3,499,304
Germany 3.2%
Adidas-Salomon AG 8,500 536,203
EM.TV & Merchandising AG 8,000 619,888
Infineon Technologies AG ADR (b) 10,800 733,050
-----------
1,889,141
Hong Kong 7.7%
China Telecom, Ltd. (b) 78,000 563,323
Hutchison Whampoa, Ltd. 49,000 714,056
Johnson Electric Holdings, Ltd. 87,600 705,762
Legend Holdings, Ltd. 1,280,000 1,487,302
Li & Fung, Ltd. 288,000 1,113,011
-----------
4,583,454
<CAPTION>
------------------------------------------------------------------------------------
STRONG OVERSEAS FUND (continued)
------------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
India 3.7%
ICICI, Ltd. Sponsored ADR 36,200 $ 868,800
Infosys Technologies, Ltd. Sponsored ADR 5,400 1,096,200
Zee Telefilms, Ltd. 17,000 276,835
-----------
2,241,835
Italy 4.4%
Bipop-Carire Spa 9,300 847,534
Mediaset Spa 32,800 542,694
Mediolanum Spa 43,800 727,410
Telecom Italia Mobile Spa 51,100 489,352
-----------
2,606,990
Japan 17.0%
Daiwa Securities Group, Inc. 130,000 1,984,090
Fuji Television Network, Inc. 70 1,165,480
Hikari Tsushin, Inc. 1,300 187,587
Keyence Corporation 1,780 590,260
NTT DoCoMo, Inc. 12 400,703
Nippon Television Network Corporation 1,700 1,268,273
Nomura Securities Company, Ltd. 66,000 1,660,531
Rohm Company, Ltd. 2,000 669,688
Sakura Bank, Ltd. 80,000 560,910
Takeda Chemical Industries, Ltd. 3,000 197,299
Tokyo Electron, Ltd. 9,000 1,466,007
-----------
10,150,828
Mexico 1.4%
Fomento Economico Mexicano SA de CV
Sponsored ADR 7,400 305,250
Telefonos de Mexico SA ADR Series L 8,600 505,787
-----------
811,037
Netherlands 9.0%
ASM Lithography Holding NV (b) 44,700 1,772,617
STMicroelectronics NV 16,600 3,165,717
Verenigde Nederlandse Uitgeversbedrijven NV 7,800 418,452
-----------
5,356,786
Portugal 0.8%
Portugal Telecom SA 40,200 449,650
Singapore 0.8%
Singapore Press Holdings, Ltd. 24,900 487,291
Spain 0.5%
Banco Santander Central Hispano SA 26,494 277,023
Sweden 2.4%
Skandia Forsakrings AB 30,200 1,451,825
Switzerland 2.0%
Adecco SA 1,475 1,215,636
Taiwan 2.9%
Taiwan Semiconductor Manufacturing Company,
Ltd. Sponsored ADR (b) 32,900 1,721,081
United Kingdom 13.6%
BP Amoco PLC Sponsored ADR 28,300 1,443,300
British Aerospace PLC 93,800 569,729
British Airways PLC 157,300 811,609
Energis PLC (b) 18,600 913,976
GKN PLC 57,000 784,852
Lloyds TSB Group PLC 65,700 639,771
Vodafone AirTouch PLC 335,753 1,533,222
Vodafone AirTouch PLC Sponsored ADR 3,000 141,000
WPP Group PLC 78,800 1,263,417
-----------
8,100,876
---------------------------------------------------------------------------------
Total Common Stocks (Cost $51,573,005) 53,981,972
---------------------------------------------------------------------------------
</TABLE>
19
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS IN SECURITIES (continued) April 30, 2000 (Unaudited)
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
STRONG OVERSEAS FUND (continued)
------------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
------------------------------------------------------------------------------------
<S> <C> <C>
SHORT-TERM INVESTMENTS (a) 12.9%
Commercial Paper 0.1%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar
Call Deposit, 5.00% $ 87,000 $ 87,000
Time Deposits 12.8%
United States
Bank of Scotland, 6.00%, Due 5/01/00 1,800,000 1,800,000
First National Bank of Chicago, 6.00%,
Due 5/01/00 2,900,000 2,900,000
Wachovia Winston Grand Cayman, 5.85%,
Due 5/01/00 2,900,000 2,900,000
----------
Total Time Deposits 7,600,000
---------------------------------------------------------------------------------
Total Short-Term Investments (Cost $7,687,000) 7,687,000
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Total Investments in Securities (Cost $59,260,005) 103.5% 61,668,972
Other Assets and Liabilities, Net (3.5%) (2,065,869)
---------------------------------------------------------------------------------
NET ASSETS 100.0% $59,603,103
=================================================================================
</TABLE>
<TABLE>
<CAPTION>
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
---------------------------------------------------------------------------------
Settlement Unrealized
Date Value in USD Appreciation
---------------------------------------------------------------------------------
<S> <C> <C> <C>
Sold:
207,500,000 JPY 5/10/00 $1,923,455 $335
</TABLE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------
STRONG GLOBAL HIGH-YIELD BOND FUND
------------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
--------------------------------------------------------------------------------
<S> <C> <C>
CORPORATE BONDS 36.3%
Argentina 3.0%
YPF Sociedad Anonima Notes, 7.75%,
Due 8/27/07 50,000 USD $ 47,822
Bermuda 6.1%
Global Crossing Holdings, Ltd. Senior Notes,
9.625%, Due 5/15/08 100,000 USD 98,500
Canada 3.4%
MetroNet Communications Corporation
Senior Notes, 10.625%, Due 11/01/08 50,000 USD 55,498
South Korea 5.8%
Korea Electric Power Company Notes, 6.375%,
Due 12/01/03 100,000 USD 93,087
United States 18.0%
AP Holdings, Inc. Senior Discount Notes,
Zero %, Due 3/15/08 (Rate Reset Effective
3/15/03) (c) $250,000 31,250
Nextlink Communications, Inc. Senior Notes,
10.75%, Due 6/01/09 100,000 98,750
R&B Falcon Corporation Senior Notes, Series B,
6.50%, Due 4/15/03 100,000 92,000
Transwestern Publishing Company LP/TWP
Capital Corporation II Senior Subordinated
Notes, Series D, 9.625%, Due 11/15/07 (c) 70,000 66,850
-----------
288,850
---------------------------------------------------------------------------------
Total Corporate Bonds (Cost $747,880) 583,757
---------------------------------------------------------------------------------
<CAPTION>
------------------------------------------------------------------------------------
STRONG GLOBAL HIGH-YIELD BOND FUND (continued)
------------------------------------------------------------------------------------
Shares or
Principal Value
Amount (Note 2)
--------------------------------------------------------------------------------
<S> <C> <C>
GOVERNMENT & AGENCY ISSUES 22.2%
Argentina 6.1%
Republic of Argentina Notes, 11.75%,
Due 4/07/09 100,000 USD $ 98,450
Mexico 16.0%
United Mexican States Bonds, 6.25%,
Due 12/31/19 250,000 USD 205,312
United Mexican States Medium-Term Notes,
Tranche 00004, 9.875%, Due 2/01/10 50,000 USD 51,625
-----------
256,937
Russia 0.1%
Vnesheconomobank Floating Rate Debentures,
6.9063%, Due 12/15/15 (Acquired 6/02/98;
Cost $5,109) (Defaulted Effective 6/02/99) (d) 8,770 USD 2,434
---------------------------------------------------------------------------------
Total Government & Agency Issues (Cost $357,515) 357,821
---------------------------------------------------------------------------------
PREFERRED STOCKS 7.4%
United States
R&B Falcon Corporation 13.875% Senior 112 119,840
---------------------------------------------------------------------------------
Total Preferred Stocks (Cost $111,207) 119,840
---------------------------------------------------------------------------------
WARRANTS 2.2%
United States
R&B Falcon Corporation, Expire 5/01/09 (d) 100 35,000
---------------------------------------------------------------------------------
Total Warrants (Cost $8,250) 35,000
---------------------------------------------------------------------------------
COMMON STOCKS 0.1%
United States
OpTel, Inc. Non-Voting (Acquired 3/18/98;
Cost $6,750) (b) (d) 150 750
---------------------------------------------------------------------------------
Total Common Stocks (Cost $6,750) 750
---------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS (a) 31.4%
Commercial Paper 6.3%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call Deposit,
5.00% $101,000 101,000
Government & Agency Issues 25.1%
United States
United States Treasury Bills:
Due 5/04/00 (c) 10,000 9,996
Due 7/27/00 (c) 400,000 394,557
-----------
Total Government & Agency Issues 404,553
---------------------------------------------------------------------------------
Total Short-Term Investments (Cost $505,582) 505,553
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Total Investments in Securities (Cost $1,737,184) 99.6% 1,602,721
Other Assets and Liabilities, Net 0.4% 6,266
---------------------------------------------------------------------------------
NET ASSETS 100.0% $1,608,987
=================================================================================
</TABLE>
<TABLE>
<CAPTION>
FUTURES
---------------------------------------------------------------------------------
Underlying
Face Amount Unrealized
Expiration Date at Value Depreciation
---------------------------------------------------------------------------------
<S> <C> <C> <C>
Sold:
1 U.S. Treasury Bonds 6/00 $96,563 $1,551
</TABLE>
20
<PAGE>
-------------------------------------------------------------------------------
STRONG INTERNATIONAL BOND FUND
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares or
Principal Value
Amount (Note 2)
-------------------------------------------------------------------------------------------
<S> <C> <C>
CORPORATE BONDS 7.9%
New Zealand 2.0%
International Bank for Reconstruction and
Development Medium-Term Notes,
Zero %, Due 8/20/07 1,000,000 NZD $ 276,750
United States 5.9%
R&B Falcon Corporation Senior Notes, Series B,
6.50%, Due 4/15/03 $200,000 184,000
Statia Terminals International/Statia Terminals
Canada, Inc. First Mortgage Notes, Series B,
11.75%, Due 11/15/03 250,000 248,750
Triton Energy, Ltd./Triton Energy Corporation
Senior Notes, 8.75%, Due 4/15/02 200,000 199,000
Viacom International, Inc. Senior Subordinated
Notes, 10.25%, Due 9/15/01 180,000 186,073
---------
817,823
-------------------------------------------------------------------------------------------
Total Corporate Bonds (Cost $1,284,209) 1,094,573
-------------------------------------------------------------------------------------------
GOVERNMENT & AGENCY ISSUES 68.2%
Australia 3.1%
Australian Government Bonds, 7.50%,
Due 7/15/05 700,000 AUD 427,014
Denmark 4.1%
Kingdom of Denmark Notes, 7.00%,
Due 11/15/07 4,250,000 DKK 562,223
Finland 3.6%
Government of Finland Bonds, 10.00%,
Due 9/15/01 3,000,000 FIM 492,123
France 6.6%
Government of France Debentures, 8.50%,
Due 11/25/02 914,694 EUR 909,729
Germany 14.2%
Republic of Germany Bonds, Series 97, 6.00%,
Due 7/04/07 2,072,583 EUR 1,961,678
Italy 10.9%
Buoni Poliennali del Tes Bonds, 7.75%,
Due 11/01/06 1,478,988 EUR 1,513,486
United Kingdom 25.7%
United Kingdom Treasury Bonds, 7.00%,
Due 6/07/02 2,250,000 GBP 3,550,603
-------------------------------------------------------------------------------------------
Total Government & Agency Issues (Cost $11,027,554) 9,416,856
-------------------------------------------------------------------------------------------
NON-AGENCY MORTGAGE & ASSET-BACKED
SECURITIES 9.1%
United States
CS First Boston Mortgage Securities Corporation
Mortgage Pass-Thru Certificates, Series 1992-4,
Class A-5, Interest Only, 0.625%,
Due 10/25/22 (c) $8,851,136 91,167
Citicorp Mortgage Securities, Inc. Real Estate
Mortgage Investment Conduit Pass-Thru
Certificates, Series 1993-3, Class B1, 7.00%,
Due 3/25/08 (c) (d) 296,322 286,338
DLJ Mortgage Acceptance Corporation Variable
Rate Mortgage Pass-Thru Certificates:
Series 1990-2, Class A, 7.0853%, Due 1/25/22 (c) 187,323 186,613
Series 1991-3, Class A1, 6.963%, Due 2/20/21 (c) 341,539 338,766
Merrill Lynch Home Equity Acceptance, Inc.
Subordinated Variable Rate Mortgage-Backed
Certificates, Series 1994-A, Class A-1, 7.1563%,
Due 8/17/23 (c) 29,791 29,642
<CAPTION>
Shares or
Principal Value
Amount (Note 2)
-------------------------------------------------------------------------------------------
<S> <C> <C>
Resolution Trust Corporation Mortgage Pass-
Thru Securities, Inc. Variable Rate Certificates,
Series 1995-1, Class B-5, 7.15%, Due 10/25/28 $327,269 $ 326,676
-------------------------------------------------------------------------------------------
Total Non-Agency Mortgage & Asset-Backed
Securities (Cost $1,168,897) 1,259,202
-------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS (a) 12.3%
Commercial Paper 0.0%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call Deposit,
5.00% 1,000 1,000
Corporate Bonds 2.2%
United States
Bank of Boston Corporation Subordinated
Floating Rate Notes, 6.231%, Due 2/28/01 (c) 50,000 50,000
Deeptech International, Inc. Senior Notes,
12.00%, Due 12/15/00 250,000 251,544
---------
Total Corporate Bonds 301,544
Government & Agency Issues 5.0%
Denmark
Kingdom of Denmark Notes, 9.00%,
Due 11/15/00 4,400,000 DKK 547,949
United States
United States Treasury Bills, Due 5/04/00 (c) $150,000 149,935
---------
Total Government & Agency Issues 697,884
Time Deposits 5.1%
United States
Wachovia Winston Grand Cayman, 5.85%,
Due 5/01/00 700,000 700,000
-------------------------------------------------------------------------------------------
Total Short-Term Investments (Cost $1,867,053) 1,700,428
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Total Investments in Securities (Cost $15,347,713) 97.5% 13,471,059
Other Assets and Liabilities, Net 2.5% 341,732
-------------------------------------------------------------------------------------------
NET ASSETS 100.0% $13,812,791
===========================================================================================
<CAPTION>
FUTURES
-------------------------------------------------------------------------------------------
Underlying
Face Amount Unrealized
Expiration Date at Value Appreciation
-------------------------------------------------------------------------------------------
<S> <C> <C>
Purchased:
14 Ten-Year Euro Bonds 6/00 $1,339,994 $26,664
3 Ten-Year Japanese
Government Bonds 6/00 3,675,226 33,587
<CAPTION>
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
-------------------------------------------------------------------------------------------
Unrealized
Settlement Appreciation
Date Value in USD (Depreciation)
-------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Purchased:
1,000,000 CAD 10/04/00 $ 678,475 ($12,658)
2,200,000 EUR 8/07/00 2,019,508 (82,062)
560,000,000 JPY 8/07/00 5,276,329 (65,653)
Sold:
1,150,000 AUD 10/04/00 672,589 26,611
9,500,000 DKK 10/04/00 1,169,678 60,893
1,250,000 GBP 10/04/00 1,942,205 49,276
</TABLE>
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) April 30, 2000 (Unaudited)
--------------------------------------------------------------------------------
STRONG SHORT-TERM GLOBAL BOND FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
---------------------------------------------------------------------------------
<S> <C> <C>
CORPORATE BONDS 12.3%
Canada 0.8%
MetroNet Communications Corporation
Senior Notes, 12.00%, Due 8/15/07 350,000 USD $ 394,079
New Zealand 0.5%
International Bank for Reconstruction and
Development Medium-Term Notes, Zero %,
Due 8/20/07 1,000,000 NZD 276,750
United Kingdom 0.9%
Telewest PLC Senior Discount Debentures,
Zero %, Due 10/01/07 (Rate Reset
Effective 10/01/00) 500,000 USD 472,500
United States 10.1%
Atlas Air, Inc. Pass-Thru Certificates,
Series 1998-1, Class C, 8.01%, Due 1/02/10 $ 870,007 816,436
GS Escrow Corporation Senior Notes, 6.75%,
Due 8/01/01 1,000,000 965,404
R&B Falcon Corporation Senior Notes,
Series B, 6.50%, Due 4/15/03 1,000,000 920,000
Tenet Healthcare Corporation Senior Notes,
8.625%, Due 12/01/03 1,000,000 973,048
Triton Energy, Ltd./Triton Energy Corporation
Senior Notes, 8.75%, Due 4/15/02 1,000,000 995,000
Waste Management, Inc. Senior Notes, 6.50%,
Due 12/15/02 500,000 457,892
-----------
5,127,780
--------------------------------------------------------------------------------
Total Corporate Bonds (Cost $6,528,688) 6,271,109
--------------------------------------------------------------------------------
GOVERNMENT & AGENCY ISSUES 28.1%
Australia 3.1%
Australian Government Bonds, 7.50%,
Due 7/15/05 2,600,000 AUD 1,586,051
Germany 2.9%
Republic of Germany Bonds, Series 97, 6.00%,
Due 7/04/07 1,575,000 EUR 1,490,721
United Kingdom 4.7%
United Kingdom Treasury Bonds, 7.00%,
Due 6/07/02 1,500,000 GBP 2,367,068
United States 17.4%
FHLMC Multi-Class Mortgage Participation
Certificates, 9.50%, Due 6/15/06 (c) $ 802,419 822,374
FHLMC Participation Certificates:
7.00%, Due 5/01/03 thru 7/15/06 1,340,236 1,335,074
7.702%, Due 7/01/10 209,767 209,565
9.00%, Due 8/01/18 650,018 671,510
10.00%, Due 6/01/05 319,743 330,529
FNMA Guaranteed Mortgage Pass-Thru
Cerificates, Pool #372179, 11.00%,
Due 4/01/12 293,825 316,557
FNMA Guaranteed Real Estate Mortgage
Investment Conduit Pass-Thru Certificates:
Pool #149167, 10.50%, Due 8/01/20 (c) 230,630 246,030
Pool #313629, 8.50%, Due 11/01/02 (c) 969,649 978,414
FNMA Guaranteed Real Estate Mortgage
Investment Conduit Variable Rate Mortgage
Certificates, Pool #365418, 7.038%,
Due 1/01/23 405,135 410,817
GNMA Guaranteed Pass-Thru Certificates,
Pool #234503, 9.50%, Due 12/15/17 3,337,002 3,516,107
-----------
8,836,977
--------------------------------------------------------------------------------
Total Government & Agency Issues (Cost $14,869,199) 14,280,817
--------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
---------------------------------------------------------------------------------
<S> <C> <C>
NON-AGENCY MORTGAGE & ASSET-BACKED
SECURITIES 18.3%
United States
Citicorp Mortgage Securities, Inc. Real Estate
Mortgage Investment Conduit Pass-Thru
Certificates, Series 1993-3, Class B1, 7.00%,
Due 3/25/08 (d) $ 592,645 $ 572,676
DLJ Acceptance Trust Collateralized Mortgage
Obligation, Series 1989-1, Class F, 11.00%,
Due 8/01/19 1,464,822 1,587,708
DLJ Mortgage Acceptance Corporation Variable
Rate Mortgage Pass-Thru Certificates:
Series 1990-2, Class A, 7.0853%, Due 1/25/22 749,294 746,450
Series 1991-3, Class A1, 6.963%, Due 2/20/21 (c) 683,078 677,532
Empire Funding Home Loan Owner Trust Asset-
Backed Notes, Series 1997-4, Class A3, 7.11%,
Due 7/25/14 (c) 2,202,330 2,191,990
Kmart CMBS Financing, Inc. Floating Rate
Commercial Mortgage Pass-Thru Certificates,
Series 1997-1, Class D, 7.2325%,
Due 3/01/07 (d) 2,000,000 1,990,690
Merrill Lynch Credit Corporation Mortgage
Investors, Inc. Senior Subordinated Variable
Rate Mortgage Pass-Thru Certificates,
Series 1994-A, Class A4, 7.4833%, Due 7/15/19 825,053 822,539
Merrill Lynch Home Equity Acceptance, Inc.
Subordinated Variable Rate Mortgage-Backed
Certificates, Series 1994-A, Class A1, 7.1563%,
Due 8/17/23 19,861 19,761
Resolution Trust Corporation Mortgage Pass-
Thru Securities, Inc. Variable Rate Certificates,
Series 1995-1, Class B5, 7.1503%,
Due 10/25/28 (c) 158,257 157,970
Resolution Trust Corporation Variable Rate
Mortgage Pass-Thru Securities, Inc.
Commercial Certificates, Series 1992-C8,
Class A2, 7.495%, Due 12/25/23 39,320 39,358
Ryland Mortgage Securities Corporation Variable
Rate Mortgage Participation Securities,
Series 1990-C1, Class A, 6.2892%, Due 10/25/20 508,919 506,695
----------------------------------------------------------------------------
Total Non-Agency Mortgage & Asset-Backed
Securities (Cost $9,291,357) 9,313,369
----------------------------------------------------------------------------
SHORT-TERM INVESTMENTS (a) 40.5%
Commercial Paper 0.1%
Interest Bearing, Due Upon Demand
United States
United States Cayman Eurodollar Call Deposit,
5.00% 53,000 53,000
Corporate Bonds 3.0%
Canada 1.3%
Trizec Hahn Corporation Debentures, 6.10%,
Due 9/01/00 1,000,000 CAD 674,539
United States 1.7%
Bank of Boston Corporation Subordinated
Floating Rate Notes, 6.2263%, Due 2/28/01 $100,000 100,000
Niagara Mohawk Power Corporation Senior
Notes, Series B, 7.00%, Due 10/01/00 756,098 753,642
---------
853,642
---------
Total Corporate Bonds 1,528,181
Government & Agency Issues 0.2%
United States
United States Treasury Bills, Due 5/04/00 (c) 100,000 99,957
</TABLE>
22
<PAGE>
--------------------------------------------------------------------------------
STRONG SHORT-TERM GLOBAL BOND FUND (continued)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL VALUE
AMOUNT (NOTE 2)
---------------------------------------------------------------------------------
<S> <C> <C>
Time Deposits 37.2%
United States
Bank of Scotland, 6.00%, Due 5/01/00 $2,500,000 $ 2,500,000
First National Bank of Chicago, 6.00%,
Due 5/01/00 2,500,000 2,500,000
Republic National Bank of New York, 5.9375%,
Due 5/01/00 8,500,000 8,500,000
Societe Generale, 6.00%, Due 5/01/00 2,500,000 2,500,000
Wachovia Winston Grand Cayman, 5.85%,
Due 5/01/00 2,900,000 2,900,000
-----------
Total Time Deposits 18,900,000
--------------------------------------------------------------------------------
Total Short-Term Investments (Cost $20,586,228) 20,581,138
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total Investments in Securities (Cost $51,275,472) 99.2% 50,446,433
Other Assets and Liabilities, Net 0.8% 417,819
================================================================================
NET ASSETS 100.0% $50,864,252
================================================================================
</TABLE>
<TABLE>
<CAPTION>
FUTURES
-----------------------------------------------------------------------------------
Underlying Unrealized
Expiration Face Amount Appreciation
Date at Value (Depreciation)
-----------------------------------------------------------------------------------
<S> <C> <C> <C>
Purchased:
25 Ten-Year Euro Bonds 6/00 $2,392,846 $ 47,615
Sold:
16 Five-Year U.S. Treasury Notes 6/00 1,561,250 (15,443)
9 Ten-Year Australian Government
Bonds 6/00 739,920 (9,793)
</TABLE>
<TABLE>
<CAPTION>
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
--------------------------------------------------------------------------------
Settlement Unrealized
Date Value in USD Appreciation
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Sold:
2,500,000 AUD 8/08/00 $1,461,200 $ 63,800
1,000,000 CAD 9/01/00 677,902 12,706
1,700,000 EUR 8/07/00 1,560,529 140,236
1,525,000 GBP 6/23/00 2,365,783 84,892
580,000 NZD 8/07/00 281,300 8,004
</TABLE>
-------------------------------------------------------------------------------
CURRENCY ABBREVIATIONS
-------------------------------------------------------------------------------
<TABLE>
<S> <C>
AUD Australian Dollar
CAD Canadian Dollar
DKK Danish Krone
EUR Euro
FIM Finnish Mark
GBP British Pound
JPY Japanese Yen
NZD New Zealand Dollar
USD United States Dollar
LEGEND
------------------------------------------------------------------------------
</TABLE>
(a) Shot-term investments include any security which has a remaining maturity
of less than one year.
(b) Non-income producing security.
(c) All or a portion of security pledged to cover margin requirements for
futures contracts.
(d) Restricted security.
(e) Affiliated Issuer (See Note 7 of Notes to Financial Statements.)
Percentages are stated as a percent of net assets.
See Notes to Financial Statements. 23
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
-------------------------------------------------------------------------------
April 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
(In Thousands, Except per Share Amounts)
Strong Foreign Strong Strong
Strong Asia MajorMarkets International Overseas
Pacific Fund Fund Stock Fund Fund
------------ -------------- ------------- --------
<S> <S> <C> <C> <C>
Assets:
Investments in Securities, at Value
Unaffiliated Issuers (Cost of $108,791, $3,331, $111,680
and $59,260, respectively) $103,066 $3,617 $181,313 $61,669
Affiliated Issuers (Cost of $0, $0, $635 and $0, respectively) -- -- 635 --
Receivable for Securities Sold 1,028 -- 1,740 --
Receivable for Fund Shares Sold 423 1 1,867 --
Dividends and Interest Receivable 182 6 254 78
Other Assets 619 11 112 2
-------- ------- ------- -------
Total Assets 105,318 3,635 185,921 61,749
Liabilities:
Payable for Securities and Forward Foreign Currency
Contracts Purchased 789 70 5,270 1,944
Payable for Fund Shares Redeemed 207 -- 748 162
Accrued Operating Expenses and Other Liabilities 116 2 178 40
-------- ------- ------- -------
Total Liabilities 1,112 72 6,196 2,146
-------- ------- ------- -------
Net Assets $104,206 $3,563 $179,725 $59,603
======== ======= ======= =======
Net Assets Consist of:
Capital Stock (par value and paid-in capital) $ 94,057 $3,187 $154,784 $60,227
Accumulated Net Investment Loss (3,292) (13) (862) (39)
Accumulated Net Realized Gain (Loss) 19,161 102 (43,811) (2,993)
Net Unrealized Appreciation (Depreciation) (5,720) 287 69,614 2,408
-------- ------- ------- -------
Net Assets $104,206 $3,563 $179,725 $59,603
======== ======= ======= =======
Capital Shares Outstanding (Unlimited Number Authorized) 10,427 291 10,075 3,087
Net Asset Value Per Share $9.99 $12.23 $17.84 $19.31
======== ======= ======= =======
</TABLE>
24 See Notes to Financial Statements.
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
-------------------------------------------------------------------------------
April 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
(In Thousands, Except per Share Amounts)
Strong Global Strong Strong
High-Yield International Short-Term Global
Bond Fund Bond Fund Bond Fund
------------- ------------- -----------------
<S> <C> <C> <C>
Assets:
Investments in Securities, at Value
(Cost of $1,737, $15,348 and $51,275, respectively) $1,603 $13,471 $50,446
Receivable for Securities and Forward Foreign Currency Contracts Sold -- 111 326
Receivable for Fund Shares Sold -- 17 42
Interest Receivable 25 386 317
Other Assets 9 11 23
------ ------- -------
Total Assets 1,637 13,996 51,154
Liabilities:
Payable for Securities and Forward Foreign Currency Contracts Purchased 3 161 --
Payable for Fund Shares Redeemed 4 5 --
Dividends Payable 11 -- 258
Accrued Operating Expenses and Other Liabilities 10 17 32
------ ------- -------
Total Liabilities 28 183 290
------ ------- -------
Net Assets $1,609 $13,813 $50,864
====== ======= =======
Net Assets Consist of:
Capital Stock (par value and paid-in capital) $2,161 $17,224 $54,945
Accumulated Net Investment Income (Loss) -- (413) 300
Accumulated Net Realized Loss (416) (1,130) (3,871)
Net Unrealized Depreciation (136) (1,868) (510)
------ ------- -------
Net Assets $1,609 $13,813 $50,864
====== ======= =======
Capital Shares Outstanding (Unlimited Number Authorized) 190 1,470 5,019
Net Asset Value Per Share $8.49 $9.40 $10.14
====== ======= =======
</TABLE>
See Notes to Financial Statements. 25
<PAGE>
STATEMENTS OF OPERATIONS
-------------------------------------------------------------------------------
For the Six Months Ended April 30, 2000 (Unaudited)
<TABLE>
<CAPTION>
(In Thousands)
Strong Foreign Strong Strong
Strong Asia MajorMarkets International Overseas
Pacific Fund Fund Stock Fund Fund
------------ -------------- -------------- --------
<S> <C> <C> <C> <C>
Income:
Dividends (net of foreign withholding taxes of $180,
$1, $128 and $12, respectively) $462 $ 13 $ 414 $ 145
Interest 156 7 122 124
------ ----- --------- -------
Total Income 618 20 536 269
Expenses:
Investment Advisory Fees 633 16 869 177
Custodian Fees 156 37 130 58
Shareholder Servicing Costs 150 5 240 47
Interest Expense 11 1 73 --
Professional Fees 11 4 19 4
Federal and State Registration Fees 23 9 10 28
Other 42 2 57 10
------ ----- --------- ------
Total Expenses before Waivers and Absorptions 1,026 74 1,398 324
Involuntary Expense Waivers and Absorptions by Advisor -- (42) -- (16)
------ ----- --------- ------
Expenses, Net 1,026 32 1,398 308
------ ----- --------- ------
Net Investment Loss (408) (12) (862) (39)
Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on:
Investments 21,791 65 17,737 (2,210)
Futures and Forward Foreign Currency Contracts -- 43 548 (407)
Foreign Currencies 12 -- 4 1
------ ----- --------- ------
Net Realized Gain (Loss) 21,803 108 18,289 (2,616)
Net Change in Unrealized Appreciation/Depreciation on:
Investments (11,323) 155 29,212 240
Futures and Forward Foreign Currency Contracts -- (7) 81 3
Foreign Currencies (7) -- (14) (2)
------ ----- --------- ------
Net Change in Unrealized Appreciation/Depreciation (11,330) 148 29,279 241
------ ----- --------- ------
Net Gain (Loss) on Investments 10,473 256 47,568 (2,375)
------ ----- --------- ------
Net Increase (Decrease) in Net Assets Resulting from Operations $10,065 $244 $46,706 ($2,414)
====== ===== ========= ======
</TABLE>
26 See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS (CONTINUED)
----------------------------------------------------------------------------------------------------------------------------------
For the Six Months Ended April 30, 2000 (Unaudited)
(In Thousands)
Strong Global Strong Strong
High-Yield International Short-Term Global
Bond Fund Bond Fund Bond Fund
---------- --------- ---------
<S> <C> <C> <C>
Income:
Interest (net of foreign withholding taxes of $0, $2 and $12, respectively $ 60 $ 515 $ 1,430
Dividends 7 -- --
------- ------- -------
Total Income 67 515 1,430
Expenses:
Investment Advisory Fees 5 58 146
Custodian Fees 17 21 23
Shareholder Servicing Costs 3 31 59
Professional Fees 5 7 8
Reports to Shareholders 1 10 17
Federal and State Registration Fees 7 11 12
Other 3 1 3
------- ------- -------
Total Expenses before Waivers and Absorptions 41 139 268
Involuntary Expense Waivers and Absorptions by Advisor (26) -- --
------- ------- -------
Expenses, Net 15 139 268
------- ------- -------
Net Investment Income 52 376 1,162
Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on:
Investments 10 (562) (71)
Futures and Forward Foreign Currency Contracts -- 392 233
Foreign Currencies -- (16) 2
------- ------- -------
Net Realized Gain (Loss) 10 (186) 164
Net Change in Unrealized Appreciation/Depreciation on:
Investments (72) (740) (594)
Futures and Forward Foreign Currency Contracts (2) (686) 287
Foreign Currencies -- (19) (12)
------- ------- -------
Net Change in Unrealized Appreciation/Depreciation (74) (1,445) (319)
------- ------- -------
Net Loss on Investments (64) (1,631) (155)
------- ------- -------
Net Increase (Decrease) in Net Assets Resulting from Operations ($ 12) ($1,255) $ 1,007
======= ======= =======
</TABLE>
27
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
---------------------------------------------------------------------------------------------------------------------------------
(In Thousands)
Strong Asia Strong Foreign
Pacific Fund MajorMarkets
--------------------------------- ---------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
April 30, 2000 Oct. 31, 1999 April 30, 2000 Oct. 31, 1999
---------------- ------------- ---------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Operations:
Net Investment Income (Loss) ($ 408) $ 128 ($ 12) $ 4
Net Realized Gain 21,803 18,157 108 212
Net Change in Unrealized Appreciation/Depreciation (11,330) 7,815 148 215
--------- --------- ------- -------
Net Increase in Net Assets Resulting from Operations 10,065 26,100 244 431
Distributions:
From Net Investment Income (4,599) -- (5) --
From Net Realized Gains -- -- (190) --
--------- --------- ------- -------
Total Distributions (4,599) -- (195) --
Capital Share Transactions:
Proceeds from Shares Sold 150,501 237,030 5,800 2,771
Proceeds from Reinvestment of Distributions 4,359 -- 192 --
Payment for Shares Redeemed (159,525) (181,435) (4,501) (2,643)
--------- --------- ------- -------
Net Increase (Decrease) in Net Assets
from Capital Share Transactions (4,665) 55,595 1,491 128
--------- --------- ------- -------
Total Increase in Net Assets 801 81,695 1,540 559
Net Assets:
Beginning of Period 103,405 21,710 2,023 1,464
--------- --------- ------- -------
End of Period $ 104,206 $ 103,405 $ 3,563 $ 2,023
========= ========= ======= =======
Transactions in Shares of the Fund:
Sold 13,392 28,350 447 265
Issued in Reinvestment of Distributions 373 -- 15 --
Redeemed (14,086) (21,597) (342) (250)
--------- --------- ------- -------
Net Increase (Decrease) in Shares of the Fund (321) 6,753 120 15
========= ========= ======= =======
</TABLE>
28
See Notes to Financial Statements
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
---------------------------------------------------------------------------------------------------------------------------------
(In Thousands)
Strong International Strong Overseas
Stock Fund Fund
--------------------------------- ---------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
April 30, 2000 Oct. 31, 1999 April 30, 2000 Oct. 31, 1999
---------------- ------------- ---------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Operations:
Net Investment Loss ($ 862) ($ 701) ($ 39) ($ 40)
Net Realized Gain (Loss) 18,289 (204) (2,616) 262
Net Change in Unrealized Appreciation/Depreciation 29,279 39,468 241 2,113
-------- -------- -------- --------
Net Increase (Decrease) in Net Assets
Resulting from Operations 46,706 38,563 (2,414) 2,335
Distributions In Excess of Net Investment Income -- (571) -- --
Capital Share Transactions:
Proceeds from Shares Sold 260,370 150,687 87,405 9,498
Proceeds from Reinvestment of Distributions -- 554 -- --
Payment for Shares Redeemed (239,768) (172,836) (32,639) (7,309)
-------- -------- -------- --------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 20,602 (21,595) 54,766 2,189
-------- -------- -------- --------
Total Increase in Net Assets 67,308 16,397 52,352 4,524
Net Assets:
Beginning of Period 112,417 96,020 7,251 2,727
-------- -------- -------- --------
End of Period $ 179,725 $ 112,417 $ 59,603 $ 7,251
======== ======== ======== ========
Transactions in Shares of the Fund:
Sold 14,244 14,284 4,122 820
Issued in Reinvestment of Distributions -- 56 -- --
Redeemed (12,822) (16,416) (1,539) (647)
-------- -------- -------- --------
Net Increase (Decrease) in Shares of the Fund 1,422 (2,076) 2,583 173
======== ======== ======== ========
</TABLE>
29
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
----------------------------------------------------------------------------------------------------------------------------------
(In Thousands)
Strong Global Strong International
High-Yield Bond Fund Bond Fund
--------------------------------- -------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
April 30, 2000 Oct. 31, 1999 April 30, 2000 Oct. 31, 1999
---------------- ------------- ----------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Operations:
Net Investment Income $ 52 $ 111 $ 376 $ 881
Net Realized Gain (Loss) 10 9 (186) 171
Net Change in Unrealized Appreciation/Depreciation (74) 16 (1,445) (2,097)
-------- -------- -------- --------
Net Increase (Decrease) in Net Assets Resulting
from Operations (12) 136 (1,255) (1,045)
Distributions From Net Investment Income (52) (111) (900) (1,075)
Capital Share Transactions:
Proceeds from Shares Sold 938 1,364 3,547 12,058
Proceeds from Reinvestment of Distributions 42 89 825 995
Payment for Shares Redeemed (613) (1,694) (7,176) (12,320)
-------- -------- -------- --------
Net Increase (Decrease) in Net Assets from Capital
Share Transactions 367 (241) (2,804) 733
Total Increase (Decrease) in Net Assets 303 (216) (4,959) (1,387)
Net Assets:
Beginning of Period 1,306 1,522 18,772 20,159
-------- -------- -------- --------
End of Period $ 1,609 $ 1,306 $ 13,813 $ 18,772
======== ======== ======== ========
Transactions in Shares of the Fund:
Sold 106 150 356 1,111
Issued in Reinvestment of Distributions 5 10 83 89
Redeemed (69) (187) (734) (1,131)
-------- -------- -------- --------
Net Increase (Decrease) in Shares of the Fund 42 (27) (295) 69
======== ======== ======== ========
</TABLE>
30
See Notes to Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
--------------------------------------------------------------------------------------------------------------
(In Thousands)
Strong Short-Term
Global Bond Fund
-------------------------------
Six Months Ended Year Ended
April 30, 2000 Oct. 31, 1999
---------------- -------------
(Unaudited)
<S> <C> <C>
Operations:
Net Investment Income $ 1,162 $ 2,986
Net Realized Gain (Loss) 164 (246)
Net Change in Unrealized Appreciation/Depreciation (319) 813
-------- -------
Net Increase in Net Assets Resulting from Operations 1,007 3,553
Distributions From Net Investment Income (1,353) (3,197)
Capital Share Transactions:
Proceeds from Shares Sold 18,628 21,365
Proceeds from Reinvestment of Distributions 1,203 3,126
Payment for Shares Redeemed (12,832) (56,039)
-------- -------
Net Increase (Decrease) in Net Assets from Capital Share Transactions 6,999 (31,548)
Total Increase (Decrease) in Net Assets 6,653 (31,192)
Net Assets:
Beginning of Period 44,211 75,403
-------- -------
End of Period $ 50,864 $ 44,211
======== =======
Transactions in Shares of the Fund:
Sold 1,831 2,089
Issued in Reinvestment of Distributions 118 306
Redeemed (1,261) (5,482)
-------- -------
Net Increase (Decrease) in Shares of the Fund 688 (3,087)
======== =======
</TABLE>
31
See Notes to Financial Statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------
April 30, 2000 (Unaudited)
1. Organization
The accompanying financial statements represent the Strong International
Funds (the "Funds"), which include the following funds, each with its own
investment objectives and policies:
- Strong Asia Pacific Fund, Inc.(1)(2)
- Strong Foreign MajorMarkets Fund(2) (a series of Strong International
Equity Funds, Inc.(1))
- Strong International Stock Fund(2) (a series of Strong International
Equity Funds, Inc.(1))
- Strong Overseas Fund(2) (a series of Strong International Equity
Funds, Inc.(1))
- Strong Global High-Yield Bond Fund(3) (a series of Strong
International Income Funds, Inc.(1))
- Strong International Bond Fund(3) (a series of Strong International
Income Funds, Inc.(1))
- Strong Short-Term Global Bond Fund, Inc.(1)(2)
(1) An open-end management investment company registered under the
Investment Company Act of 1940, as amended.
(2) Diversified fund
(3) Non-diversified fund
2. Significant Accounting Policies
The following is a summary of significant accounting policies followed by
the Funds in the preparation of their financial statements.
(A) Security Valuation -- Securities of the Funds are valued at fair value
through valuations obtained by a commercial pricing service or the
mean of the bid and asked prices when no last sales price is
available. Debt securities not traded on a principal securities
exchange are valued through valuations obtained from a commercial
pricing service, otherwise sale or bid prices are used. Securities for
which market quotations are not readily available are valued at fair
value as determined in good faith under consistently applied
procedures established by and under the general supervision of the
Board of Directors. Securities which are purchased within 60 days of
their stated maturity are valued at amortized cost, which approximates
fair value.
The Funds may own certain investment securities which are restricted
as to resale. These securities are valued after giving due
consideration to pertinent factors including recent private sales,
market conditions and the issuer's financial performance. The Funds
generally bear the costs, if any, associated with the disposition of
restricted securities. Aggregate cost and fair value of these
restricted securities held at April 30, 2000 were as follows:
<TABLE>
<CAPTION>
Aggregate Aggregate Percent of
Cost Fair Value Net Assets Liquid*
----------- ----------- ----------- -------
<S> <C> <C> <C> <C>
Strong Asia Pacific Fund $ 416,794 $ 586,113 0.6% 100.0%
Strong International Stock Fund 635,000 635,000 0.4% 0.0%
Strong Global High-Yield Bond Fund 20,109 38,184 2.4% 91.7%
Strong International Bond Fund 291,947 286,338 2.1% 100.0%
Strong Short-Term Global Bond Fund 2,583,894 2,563,365 5.0% 100.0%
</TABLE>
*Percentage of restricted securities which are either Section 4(2)
commercial paper or are eligible for resale pursuant to Rule 144A
under the Securities Act of 1933 and also have been determined to be
liquid by the Advisor based upon guidelines established by the Fund's
Board of Directors.
(B) Federal Income and Excise Taxes and Distributions to Shareholders--
The Funds intend to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute substantially all of their taxable income to their
shareholders in a manner which results in no tax cost to the Funds.
Therefore, no Federal income or excise tax provision is required.
Net investment income or net realized gains for financial statement
purposes may differ from the characterization for federal income tax
purposes due to differences in the recognition of income and expense
items for financial statement and tax purposes. Where appropriate,
reclassifications between net asset accounts are made for such
differences that are permanent in nature.
Strong Global High-Yield Bond Fund and Strong Short-Term Global Bond
Fund pay dividends from net investment income monthly, Strong
International Bond Fund pays dividends from net investment income
quarterly, and Strong Asia Pacific Fund, Strong Foreign MajorMarkets
Fund, Strong International Stock Fund and Strong Overseas Fund pay
dividends from net investment income annually. The Funds distribute
any net realized capital gains annually. Strong Global High-Yield Bond
Fund and Strong Short-Term Global Bond Fund declare dividends on each
day the net asset value is calculated, except for bank holidays.
32
<PAGE>
(C) Realized Gains and Losses on Investment Transactions -- Investment
security transactions are recorded as of the trade date. Gains or
losses realized on investment transactions are determined by comparing
the identified cost of the security lot sold with the net sales
proceeds.
(D) Certain Investment Risks -- The Funds may utilize derivative
instruments including options, futures and other instruments with
similar characteristics to the extent that they are consistent with
the Fund's investment objectives and limitations. The Funds intend
to use such derivative instruments primarily to hedge or protect from
adverse movements in securities prices or interest rates. The use of
these instruments may involve risks such as the possibility of
illiquid markets or imperfect correlation between the value of the
instruments and the underlying securities, or that the counterparty
will fail to perform its obligations.
Investments in foreign denominated assets or forward currency
contracts may involve greater risks than domestic investments due to
currency, political, economic, regulatory and market risks.
(E) Futures -- Upon entering into a futures contract, the Funds pledge
to the broker cash or other investments equal to the minimum
"initial margin" requirements of the exchange. Additional securities
held by the Funds may be designated as collateral on open futures
contracts. The Funds also receive from or pay to the broker an amount
of cash equal to the daily fluctuation in the value of the contract.
Such receipts or payments are known as "variation margin," and are
recorded as unrealized gains or losses. When the futures contract is
closed, a realized gain or loss is recorded equal to the difference
between the value of the contract at the time it was opened and the
value at the time it was closed.
(F) Options -- The Funds may write put or call options (none were written
during the period). Premiums received by the Funds upon writing put or
call options are recorded as an asset with a corresponding liability
which is subsequently adjusted to the current market value of the
option. Changes between the initial premiums received and the current
market value of the options are recorded as unrealized gains or
losses. When an option expires, is exercised, or is closed, the Funds
realize a gain or loss, and the liability is eliminated. The Funds
continue to bear the risk of adverse movements in the price of the
underlying asset during the period of the option, although any
potential loss during the period would be reduced by the amount of
the option premium received. Securities held by the Funds may be
designated as collateral on written options.
(G) Foreign Currency Translation -- Investment securities and other assets
and liabilities initially expressed in foreign currencies are
converted daily to U.S. dollars based upon current exchange rates.
Purchases and sales of foreign investment securities and income are
converted to U.S. dollars based upon currency exchange rates
prevailing on the respective dates of such transactions. The effect of
changes in foreign exchange rates on realized and unrealized security
gains or losses is reflected as a component of such gains or losses.
(H) Forward Foreign Currency Exchange Contracts -- Forward foreign
currency exchange contracts are valued at the forward rate and are
marked-to-market daily. The change in market value is recorded as an
unrealized gain or loss. When the contract is closed, the Funds record
an exchange gain or loss equal to the difference between the value of
the contract at the time it was opened and the value at the time it
was closed.
(I) Use of Estimates -- The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts in these financial statements. Actual results could differ
from those estimates.
(J) Other -- Dividend income and distributions to shareholders are
recorded on the ex-dividend date. Interest income is recorded on the
accrual basis and includes amortization of premiums and discounts.
3. Related Party Transactions
Strong Capital Management, Inc. (the "Advisor"), with whom certain officers
and directors of the Funds are affiliated, provides investment advisory
services and shareholder recordkeeping and related services to the Funds.
Investment advisory fees, which are established by terms of the Advisory
Agreements, are based on the following annualized rates of the average
daily net assets: Strong Asia Pacific Fund, Strong Foreign MajorMarkets
Fund, Strong International Stock Fund and Strong Overseas Fund 1.00%,
Strong Global High-Yield Bond Fund and Strong International Bond Fund
0.70%, and Strong Short-Term Global Bond Fund 0.625%. Based on the terms of
the Advisory Agreements, advisory fees and other expenses will be waived or
absorbed by the Advisor if the Fund's operating expenses exceed 2% of the
average daily net assets of the Fund. In addition, the Fund's Advisor may
voluntarily waive or absorb certain expenses at its discretion. Shareholder
recordkeeping and related service fees are based on contractually
established rates for each open and closed shareholder account. The Advisor
also allocates to each Fund certain charges or credits resulting from
transfer agency banking activities based on each Fund's level of
subscription and redemption activity. Charges allocated to the Funds by the
Advisor are included in Other Expenses in the Fund's Statement of
Operations, except where indicated. Credits allocated by the Advisor serve
to reduce the shareholder servicing expenses incurred by the Funds and are
reported as Fees Paid Indirectly by Advisor in the Funds' Statement of
Operations. The Advisor is also compensated for certain other services
related to costs incurred for reports to shareholders.
33
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
-------------------------------------------------------------------------------
April 30, 2000 (Unaudited)
The Funds may invest cash in money market funds sponsored and managed by
the Advisor, subject to certain limitations. The terms of such transactions
are identical to those of non-related entities except that, to avoid
duplicate investment advisory fees, advisory fees of each Fund are reduced
by an amount equal to advisory fees paid to the Advisor under its
investment advisory agreement with the money market funds.
Certain information regarding related party transactions, excluding the
effect of waivers and absorptions, for the six months ended April 30, 2000
is as follows:
<TABLE>
<CAPTION>
Payable to Shareholder Servicing Transfer Agency Unaffiliated
Advisor at and Other Expenses Banking Directors'
April 30, 2000 Paid to Advisor Charges/(Credits) Fees
-------------- --------------------- ----------------- ------------
<S> <C> <C> <C> <C>
Strong Asia Pacific Fund $23,635 $150,179 $ 10 $2,480
Strong Foreign MajorMarkets Fund -- 4,911 868 563
Strong International Stock Fund 38,515 240,867 (130) 3,047
Strong Overseas Fund 10,425 46,834 2,018 770
Strong Global High-Yield Bond Fund 8,352 3,054 361 545
Strong International Bond Fund 5,326 30,846 529 781
Strong Short-Term Global Bond Fund 10,230 59,224 604 1,164
</TABLE>
The Advisor owns 37.1% of Strong Foreign MajorMarkets Fund at April 30,
2000.
4. Line of Credit
The Strong Funds have established a line of credit agreement ("LOC") with
certain financial institutions to be used for temporary or emergency
purposes, primarily for financing redemption payments. Combined borrowings
among all participating Strong Funds are subject to a $350 million cap on
the total line of credit. For an individual fund, borrowings under the LOC
are limited to either the lesser of 15% of the market value of the Fund's
total assets or any explicit borrowing limits in the Funds' prospectus.
Principal and interest on each borrowing under the LOC are due not more
than 60 days after the date of the borrowing. Borrowings under the LOC bear
interest based on prevailing market rates as defined in the LOC. A
commitment fee of 0.08% per annum is incurred on the unused portion of the
LOC and is allocated to all participating Strong Funds. At April 30, 2000,
there were no borrowings by the Funds under the LOC.
5. Investment Transactions
The aggregate purchases and sales of long-term securities for the six
months ended April 30, 2000 were as follows:
<TABLE>
<CAPTION>
Purchases Sales
--------------------------------- ---------------------------------
U.S. Government U.S. Government
and Agency Other and Agency Other
----------------- ------------- ----------------- ------------
<S> <C> <C> <C> <C>
Strong Asia Pacific Fund -- $138,309,486 $ -- $133,418,471
Strong Foreign MajorMarkets Fund -- 4,725,020 -- 3,350,716
Strong International Stock Fund -- 109,662,754 -- 84,931,931
Strong Overseas Fund -- 73,697,676 -- 24,416,683
Strong Global High-Yield Bond Fund -- 557,111 -- 496,293
Strong International Bond Fund -- 7,844,713 253,640 7,593,159
Strong Short-Term Global Bond Fund -- 4,594,508 1,439,333 8,447,704
</TABLE>
6. Income Tax Information
At April 30, 2000, the investment cost, gross unrealized appreciation and
depreciation on investments and capital loss carryovers (expiring in
varying amounts through 2007) for federal income tax purposes were as
follows:
<TABLE>
<CAPTION>
Federal Tax Unrealized Unrealized Net Appreciation/ Net Capital Loss
Cost Appreciation Depreciation (Depreciation) Carryovers
-------------- ------------ ------------ ------------------ ----------------
<S> <C> <C> <C> <C> <C>
Strong Asia Pacific Fund $109,015,775 $13,028,539 $18,978,159 ($ 5,949,620) $ 2,308,182
Strong Foreign MajorMarkets Fund 3,338,909 512,881 234,368 278,513 --
Strong International Stock Fund 112,882,282 80,896,622 11,831,336 69,065,286 59,576,024
Strong Overseas Fund 59,866,907 7,717,933 5,915,868 1,802,065 228,116
Strong Global High-Yield Bond Fund 1,747,167 38,633 183,079 (144,446) 416,714
Strong International Bond Fund 15,347,713 101,120 1,977,774 (1,876,654) 944,036
Strong Short-Term Global Bond Fund 51,275,472 134,071 963,110 (829,039) 4,048,359
</TABLE>
34
<PAGE>
-------------------------------------------------------------------------------
7. Investments in Affiliates
Affiliated issuers, as defined under the Investment Company Act of 1940,
include those in which the Fund's holdings of an issuer represent 5% or
more of the outstanding voting securities of the issuer and any other
Strong Fund. A summary of transactions in the securities of these issuers
during the six months ended April 30, 2000 is as follows:
<TABLE>
<CAPTION>
Balance of Balance of Dividend
Shares Held Gross Gross Sales Shares Held Value Income
November 1, Purchases and April 30, April 30, Nov. 1, 1999 -
1999 and Additions Reductions 2000 2000 Apr. 30, 2000
------------ ------------- ----------- ------------ --------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Strong International Stock Fund
-------------------------------
Connemara Green Marble Quarries PLC 50,800 -- -- 50,800 $635,000 --
Connemara Green Marble Quarries PLC
Warrants 8,000 -- -- 8,000 -- --
</TABLE>
35
<PAGE>
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
STRONG ASIA PACIFIC FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Period Ended
-------------------------------------------------------
Apr. 30, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 2000(b) 1999 1998 1997 1996 1995(c)
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $9.62 $5.43 $7.35 $9.51 $9.55 $9.35
Income From Investment Operations:
Net Investment Income (Loss) (0.07) 0.05 0.07 0.01 0.06 0.04
Net Realized and Unrealized Gains (Losses) on Investments 0.84 4.14 (1.90) (2.01) 0.31 0.20
-------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 0.77 4.19 (1.83) (2.00) 0.37 0.24
Less Distributions:
From Net Investment Income (0.40) -- (0.07) (0.01) (0.06) (0.03)
In Excess of Net Investment Income -- (0.02) (0.03) (0.35) (0.01)
From Net Realized Gains -- -- -- (0.10) -- --
In Excess of Net Realized Gains -- -- -- (0.02) -- --
-------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.40) -- (0.09) (0.16) (0.41) (0.04)
-------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $9.99 $9.62 $5.43 $7.35 $9.51 $9.55
=========================================================================================================================
Ratios and Supplemental Data
-------------------------------------------------------------------------------------------------------------------------
Total Return +7.4% +77.2% -25.1% -21.5% +3.8% +2.6%
Net Assets, End of Period (In Millions) $104 $103 $22 $30 $72 $55
Ratio of Expenses to Average Net Assets without Waivers
and Absorptions 1.6%* 2.0% 2.0% 2.0% 2.0% 2.0%*
Ratio of Expenses to Average Net Assets 1.6%* 1.7% 2.0% 2.0% 2.0% 2.0%*
Ratio of Net Investment Income (Loss) to Average Net Assets (0.6%)* 0.2% 1.1% 0.1% 0.2% 0.5%*
Portfolio Turnover Rate 114.1% 206.1% 192.9% 96.7% 91.4% 104.3%
</TABLE>
STRONG FOREIGN MAJORMARKETS FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Period Ended
---------------------------
Apr. 30, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 2000(b) 1999 1998(d)
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $11.78 $ 9.31 $10.00
Income From Investment Operations:
Net Investment Income (Loss) (0.04) 0.03 (0.01)
Net Realized and Unrealized Gains (Losses)
on Investments 1.55 2.44 (0.68)
--------------------------------------------------------------------------------
Total from Investment Operations 1.51 2.47 (0.69)
Less Distributions:
From Net Investment Income (0.03) -- --
From Net Realized Gains (1.03) -- --
--------------------------------------------------------------------------------
Total Distributions (1.06) -- --
--------------------------------------------------------------------------------
Net Asset Value, End of Period $12.23 $11.78 $ 9.31
================================================================================
Ratios and Supplemental Data
--------------------------------------------------------------------------------
Total Return +12.3% +26.5% -6.9%
Net Assets, End of Period (In Millions) $4 $2 $1
Ratio of Expenses to Average Net Assets without
Waivers and Absorptions 2.0%* 2.0% 2.0%*
Ratio of Expenses to Average Net Assets 2.0%* 2.0% 2.0%*
Ratio of Net Investment Income (Loss) to Average
Net Assets (0.7)%* 0.2% (0.5%)*
Portfolio Turnover Rate 113.9% 144.5% 16.5%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended April 30, 2000 (unaudited).
(c) In 1995, the Fund changed its fiscal year-end from December to October.
(d) For the period from June 30, 1998 (inception) to October 31, 1998.
36
See Notes to Financial Statements.
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
--------------------------------------------------------------------------------
STRONG INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Period Ended
------------------------------------------------------
Apr. 30, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 2000(b) 1999 1998 1997 1996 1995(c)
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $12.99 $ 8.95 $11.99 $13.75 $13.03 $12.65
Income From Investment Operations:
Net Investment Income (Loss) (0.09) (0.09) 0.00(d) 0.01 0.17 0.08
Net Realized and Unrealized Gains (Losses) on Investments 4.94 4.19 (2.48) (0.69) 1.11 0.37
----------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 4.85 4.10 (2.48) (0.68) 1.28 0.45
Less Distributions:
From Net Investment Income -- -- 0.00(d) (0.01) (0.18) (0.07)
In Excess of Net Investment Income -- (0.06) (0.30) (0.26) (0.38) --
From Net Realized Gains -- -- (0.26) (0.81) -- --
In Excess of Net Realized Gains -- -- -- -- -- --
----------------------------------------------------------------------------------------------------------------------
Total Distributions -- (0.06) (0.56) (1.08) (0.56) (0.07)
----------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $17.84 $12.99 $ 8.95 $11.99 $13.75 $13.03
======================================================================================================================
Ratios and Supplemental Data
----------------------------------------------------------------------------------------------------------------------
Total Return +37.3% +46.0% -21.4% -5.7% +9.8% +3.6%
Net Assets, End of Period (In Millions) $180 $112 $96 $180 $304 $211
Ratio of Expenses to Average Net Assets without
Fees Paid Indirectly by Advisor 1.6%* 1.8% 1.9% 1.6% 1.7% 1.8%*
Ratio of Expenses to Average Net Assets 1.6%* 1.8% 1.9% 1.6% 1.7% 1.8%*
Ratio of Net Investment Income (Loss) to Average Net Assets (1.0%)* (0.7%) (0.1%) 0.5% 0.6% 0.8%*
Portfolio Turnover Rate 50.2% 84.9% 228.2% 143.7% 108.6% 102.0%
</TABLE>
STRONG OVERSEAS FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Period Ended
--------------------------
Apr. 30, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 2000(b) 1999 1998(e)
--------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $14.37 $ 8.20 $10.00
Income From Investment Operations:
Net Investment Loss (0.01) (0.08) (0.02)
Net Realized and Unrealized Gains (Losses)
on Investments 4.95 6.25 (1.78)
---------------------------------------------------------------------------------
Total from Investment Operations 4.94 6.17 (1.80)
Less Distributions:
From Net Investment Income -- -- --
---------------------------------------------------------------------------------
Total Distributions -- -- --
---------------------------------------------------------------------------------
Net Asset Value, End of Period $19.31 $14.37 $ 8.20
=================================================================================
Ratios and Supplemental Data
---------------------------------------------------------------------------------
Total Return +34.4% +75.2% -18.0%
Net Assets, End of Period (In Millions) $60 $7 $3
Ratio of Expenses to Average Net Assets without
Waivers and Absorptions 1.8%* 2.0% 2.0%*
Ratio of Expenses to Average Net Assets 1.7%* 2.0% 2.0%*
Ratio of Net Investment Loss to Average Net Assets (0.2%)* (0.9%) (0.7%)*
Portfolio Turnover Rate 73.8% 106.4% 59.5%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended April 30, 2000 (unaudited).
(c) In 1995, the Fund changed its fiscal year-end from December to October.
(d) Amount calculated is less than $0.00.
(e) For the period from June 30, 1998 (inception) to October 31, 1998.
See Notes to Financial Statements. 37
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
--------------------------------------------------------------------------------
STRONG GLOBAL HIGH-YIELD BOND FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Period Ended
---------------------------
Apr. 30, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 2000(b) 1999 1998(c)
---------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $8.83 $8.71 $10.00
Income From Investment Operations:
Net Investment Income 0.32 0.67 0.53
Net Realized and Unrealized Gains (Losses)
on Investments (0.34) 0.12 (1.29)
---------------------------------------------------------------------------------
Total from Investment Operations (0.02) 0.79 (0.76)
Less Distributions:
From Net Investment Income (0.32) (0.67) (0.53)
---------------------------------------------------------------------------------
Total Distributions (0.32) (0.67) (0.53)
---------------------------------------------------------------------------------
Net Asset Value, End of Period $8.49 $8.83 $ 8.71
=================================================================================
Ratios and Supplemental Data
---------------------------------------------------------------------------------
Total Return -0.3% +9.1% -8.0%
Net Assets, End of Period (In Millions) $2 $1 $2
Ratio of Expenses to Average Net Assets without
Waivers and Absorptions 2.0%* 2.0% 2.0%*
Ratio of Expenses to Average Net Assets 2.0%* 2.0% 2.0%*
Ratio of Net Investment Income to Average Net Assets 7.3%* 7.2% 7.2%*
Portfolio Turnover Rate 42.8% 380.1% 680.3%
</TABLE>
STRONG INTERNATIONAL BOND FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Period Ended
-----------------------------------------------------
Apr. 30, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 2000(b) 1999 1998 1997 1996 1995(d)
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $10.64 $11.89 $11.58 $11.87 $11.48 $10.36
Income From Investment Operations:
Net Investment Income 0.17 0.54 0.57 1.03 0.80 0.78
Net Realized and Unrealized Gains (Losses) on Investments (0.90) (1.14) 0.58 (1.11) 0.15 1.00
-----------------------------------------------------------------------------------------------------------------------
Total from Investment Operations (0.73) (0.60) 1.15 (0.08) 0.95 1.78
Less Distributions:
From Net Investment Income (0.51) (0.65) (0.58) (0.20) (0.50) (0.66)
In Excess of Net Investment Income -- -- -- -- -- --
From Net Realized Gains -- -- -- -- (0.06) --
In Excess of Net Realized Gains -- -- (0.26) (0.01) -- --
-----------------------------------------------------------------------------------------------------------------------
Total Distributions (0.51) (0.65) (0.84) (0.21) (0.56) (0.66)
-----------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.40 $10.64 $11.89 $11.58 $11.87 $11.48
=======================================================================================================================
Ratios and Supplemental Data
-----------------------------------------------------------------------------------------------------------------------
Total Return -7.1% -5.3% +10.9% -0.7% +8.6% +17.3%
Net Assets, End of Period (In Millions) $14 $19 $20 $28 $31 $21
Ratio of Expenses to Average Net Assets without
Waivers and Absorptions 1.7%* 1.6% 1.6% 1.5% 1.8% 2.0%*
Ratio of Expenses to Average Net Assets 1.7%* 1.6% 1.5% 0.7% 0.0% 0.0%*
Ratio of Net Investment Income to Average Net Assets 4.6%* 4.7% 5.3% 8.1% 7.4% 8.3%*
Portfolio Turnover Rate 55.6% 45.7% 158.8% 208.4% 258.3% 473.3%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended April 30, 2000 (unaudited).
(c) For the period from January 31, 1998 (inception) to October 31, 1998.
(d) In 1995, the Fund changed its fiscal year-end from December to October.
38
See Notes to Financial Statements.
<PAGE>
FINANCIAL HIGHLIGHTS (continued)
--------------------------------------------------------------------------------
STRONG SHORT-TERM GLOBAL BOND FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Period Ended
----------------------------------------------------------
Apr. 30, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 2000(b) 1999 1998 1997 1996 1995(c)
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $10.21 $10.17 $10.48 $10.74 $10.46 $10.15
Income From Investment Operations:
Net Investment Income 0.24 0.68 0.60 0.81 0.71 0.65
Net Realized and Unrealized Gains (Losses) on Investments (0.02) (0.02) (0.21) (0.10) 0.34 0.20
----------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 0.22 0.66 0.39 0.71 1.05 0.85
Less Distributions:
From Net Investment Income (0.29) (0.62) (0.59) (0.85) (0.77) (0.54)
In Excess of Net Investment Income -- -- (0.03) (0.12) -- --
From Net Realized Gains -- -- (0.08) -- -- --
In Excess of Net Realized Gains -- -- -- -- -- --
----------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.29) (0.62) (0.70) (0.97) (0.77) (0.54)
----------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $10.14 $10.21 $10.17 $10.48 $10.74 $10.46
============================================================================================================================
Ratios and Supplemental Data
----------------------------------------------------------------------------------------------------------------------------
Total Return +2.2% +6.7% +3.8% +6.8% +10.4% +8.5%
Net Assets, End of Period (In Millions) $51 $44 $75 $116 $71 $25
Ratio of Expenses to Average Net Assets without
Waivers and Absorptions 1.1%* 1.1% 1.0% 1.0% 1.5% 2.0%*
Ratio of Expenses to Average Net Assets 1.1%* 1.1% 0.9% 0.7% 0.0% 0.0%*
Ratio of Net Investment Income to Average Net Assets 5.0%* 5.6% 5.7% 7.6% 7.4% 8.2%*
Portfolio Turnover Rate 13.4% 73.1% 145.2% 168.0% 179.7% 437.3%
</TABLE>
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended April 30, 2000 (unaudited).
(c) In 1995, the Fund changed its fiscal year-end from December to October.
See Notes to Financial Statements.
39
<PAGE>
DIRECTORS
Richard S. Strong
Marvin E. Nevins
William F. Vogt
Willie D. Davis
Stanley Kritzik
Neal Malicky
OFFICERS
Richard S. Strong, CHAIRMAN OF THE BOARD
Thomas M. Zoeller, VICE PRESIDENT
Dennis A. Wallestad, VICE PRESIDENT
Stephen J. Shenkenberg, VICE PRESIDENT AND SECRETARY
John S. Weitzer, VICE PRESIDENT
John W. Widmer, TREASURER
Rhonda K. Haight, ASSISTANT TREASURER
INVESTMENT ADVISOR
Strong Capital Management, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
DISTRIBUTOR
Strong Investments, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
CUSTODIAN
Brown Brothers Harriman & Co.
40 Water Street, Boston, MA 02109
TRANSFER AGENT AND DIVIDEND-DISBURSING AGENT
Strong Capital Management, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
100 East Wisconsin Avenue, Milwaukee, Wisconsin 53202
LEGAL COUNSEL
Godfrey & Kahn, S.C.
780 North Water Street, Milwaukee, Wisconsin 53202
<PAGE>
For a prospectus containing more complete information, including management fees
and expenses, please call 1-800-368-1030. Please read it carefully before
investing or sending money. This report does not constitute an offer for the
sale of securities. Strong Funds are offered for sale by prospectus only. Strong
Investments, Inc. RT4755-0600
To order a free prospectus kit, call
1-800-368-1030
To learn more about our funds, discuss an existing account, or conduct a
transaction, call
1-800-368-3863
If you are a Financial Professional, call
1-800-368-1683
Visit our web site at
www.eStrong.com
[LOGO]
STRONG INVESTMENTS
P.O. Box 2936
Milwaukee, Wisconsin 53201
