SCOUT
WORLDWIDE
FUND
A no-load mutual fund
that seeks a favorable
total return by investing
in established companies
either in the U.S. or
whose principal business
is carried on outside
the country.
Annual Report
June 30, 1996
TO THE SHAREHOLDERS
For the fiscal year ended June 30, 1996, the net asset value of
the Scout WorldWide Fund rose from $11.56 to $12.90, and paid
dividends of $0.35. The total return (price change and reinvested
dividends) for this year was 14.74%. Over the same period the
unmanaged Standard & Poor's 500 index earned 26.00% and the
international markets as measured by the Morgan Stanley Capital
International (MSCI) EAFE (Europe, Asia and Far East) index gained
13.29%.
The compounded annual total return of the Fund since inception
(September 14, 1993) has been 11.71%. For corporate shareholders,
1.17% of ordinary income distributions qualify for the corporate
dividends received deduction.
The last five months have seen a sharp upward move in United States
interest rates. Our domestic economy has been stronger than expected
and many investors fear the Federal Reserve Bank will raise interest
rates to prevent inflation. The rest of the world has been a
different story though. Japan lowered interest rates substantially
last summer and the Europeans have been lowering interest rates in an
effort to stimulate their stagnant economies. Easier monetary policies
abroad have helped the foreign stock markets this year. The
relative strength of our economy compared to the economies abroad
and our rising interest rates compared to their easing interest
rates have made for a stronger US dollar. This dollar strength
offset some of the good returns in most foreign markets.
The "trigger" for our weaker markets over the last five months has
been the monthly employment reports which have shown more domestic
jobs created than expected. Abroad, unemployment is high with many
countries in Europe showing unemployment rates over ten percent
and Japan having a higher jobless rate than they have seen in
decades.
Japan's economy has turned up and Germany and France's economies
appear to be on the verge of turning up. To the pessimists, this
looks like a world-wide economic boom which would call for higher
rates to slow the economies down.
Scout WorldWide's portfolio is relatively over-weighted in utility
stocks, primarily in telecommunications. These stocks give us
exposure to lower interest rates and fairly dynamic growth. Within
the technology sector, several of our investments are in
telecommunications equipment, especially cellular phones.
GRAPH -- Country Diversification For Equity Securities
Top 10 Equity Holdings
Market Percent
Value of Total
Benetton Group SPA $ 630,000 2.07%
Canadian Pacific Limited 627,000 2.06%
Rhone Poulenc S.A. 620,100 2.03%
Telecom Corp New Zealand 600,750 1.97%
Canon Inc 594,225 1.95%
BCE Inc 592,500 1.94%
Carlton Communications 580,425 1.90%
Coles Myer Ltd. 569,288 1.87%
ABB A.G. 529,341 1.74%
SONY Corp. 529,000 1.73%
Top 10 Equity Holdings Total: 5,872,629 19.26%
NOTE: All market values based on 6/30/96 statement of assets.
GRAPH -- Equity-76%, Cash & Equivalents-24%
Sincerely,
/s/James L. Moffett
James L. Moffett
UMB Investment Advisors
GRAPH -- Sector Diversification
GRAPH -- Scout WorldWide Fund versus Morgan Stanley Capital
International (MSCI) EAFE Index
Hypothetical Growth of $10,000
Average annual compounded total returns for one year
and the life of the Fund (inception September 14, 1993)
as of June 30, 1996 were 14.74% and 11.71%, respectively.
Performance data contained in this report is for past
periods only. Past performance is not predictive of
future performance. Investment return and share value
will fluctuate, and redemption value may be more or less
than original cost.
Shares of the Scout Funds are not deposits or obligations
of, nor guaranteed by, UMB Bank, n.a. or any other
banking instituion; nor are they insured by the Federal
Deposit Insurance Corporation or any other applicable
deposit insurance. These shares involve investment
risks, including the possible loss of the principal
amount invested.
FINANCIAL STATEMENTS
Statement of Net Assets
June 30, 1996
<TABLE>
<CAPTION>
Market
Shares Company Cost Value
</CAPTION>
<S> <C> <C> <C>
COMMON STOCKS (ADR's) - 76.31%
AUSTRALIA - 3.37%
16,580 Broken Hill Proprietary Co. Ltd. $ 388,155 $ 462,167
19,380 Coles Myer Ltd. 489,837 569,288
877,992 1,031,455
BELGIUM - 0.50%
250 Solvay NPV** 108,502 153,412
CANADA - 5.07%
15,000 BCE Inc.** 491,819 592,500
28,500 Canadian Pacific Ltd.** 438,316 627,000
7,200 Magna International Cl. A** 316,297 331,200
1,246,432 1,550,700
DENMARK - 2.05%
6,200 Novo-Nordisk A.S. 150,310 221,650
16,000 Tele Danmark A.S. 426,824 406,000
577,134 627,650
FINLAND - 2.12%
17,500 Nokia, CP ADS Pfd. 652,559 647,500
FRANCE - 8.98%
29,458 Alcatel Alsthom 541,511 519,197
585 Carrefour Supermarche, SA ** 217,734 327,722
6,638 Elf Aquitaine 234,312 243,947
23,400 Rhone-Poulenc SA** 570,514 620,100
6,100 Schlumberger Ltd. 338,214 513,925
14,035 Total S.A. 384,910 521,049
2,287,195 2,745,940
GERMANY - 4.76%
11,000 Bayer A.G. 218,800 388,433
14,600 Dresdner Bank A.G. 351,725 366,885
2,640 SAP A.G.** 410,132 391,107
5,800 Siemens A.G. 253,675 309,787
1,234,332 1,456,212
HONG KONG - 1.33%
90,000 China Light & Power Ltd. 419,500 408,105
IRELAND - 1.38%
7,400 Elan Corp. PLC* 261,847 422,725
ITALY - 4.51%
24,000 Benetton Group S.p.A. 594,404 630,000
3,200 Luxottica Group S.p.A. 74,016 234,800
15,000 STET Societa Finanziaria 451,250 513,750
1,119,670 1,378,550
JAPAN - 8.46%
5,700 Canon Inc. 471,158 594,225
16,000 Fuji Photo Film Ltd. 380,942 510,000
4,700 Hitachi, Ltd. 445,492 440,625
1,400 Ito Yokado, Ltd. 288,400 337,400
8,000 Sony Corp. 429,260 529,000
3,500 Toyota Motor Corp. 152,688 175,437
2,167,940 2,586,687
NETHERLANDS - 2.48%
2,700 Akzo N.V. 127,888 161,325
5,618 Koninklijke Ahold N.V. 135,935 304,074
5,000 Polygram N.V. 190,962 293,125
454,785 758,524
NEW ZEALAND - 1.96%
9,000 Telecom Corp. of New Zealand 537,511 600,750
NORWAY - 0.57%
3,555 Norsk Hydro A.S. 103,090 173,751
SPAIN - 2.63%
12,000 Repsol S.A. 404,844 417,000
7,000 Telefonica De Espana S. A. 321,615 385,875
726,459 802,875
SWEDEN - 3.80%
8,600 Aktiebolaget Electrolux 373,250 432,150
22,000 Ericsson (L.M.) Telephone Co. Cl. B 295,143 473,000
12,500 Svenska Cellulosa Aktiebo** 224,207 257,140
892,600 1,162,290
SWITZERLAND - 4.58%
4,280 ABB A.G. 399,565 529,341
6,200 Ciba Geigy A.G. 172,825 377,704
8,650 Nestle S.A. 362,400 493,785
934,790 1,400,830
UNITED KINGDOM - 15.81%
10,000 Bass Public Ltd. Co. 158,150 247,500
18,300 British Gas PLC 649,305 512,400
7,000 British Telecommun PLC 399,399 376,250
15,328 Cadbury Schweppes Ltd. PLC 435,830 494,328
14,200 Carlton Communications 392,147 580,425
18,097 Grand Metropolitan Ltd. PLC 492,052 484,095
3,200 Reuters Holdings PLC 111,250 232,000
60,000 Royal Bank of Scotland PLC ** 492,719 459,612
9,000 SmithKline Beecham PLC 297,421 489,375
13,000 Vodafone Group 370,326 479,375
43,000 Waste Management International* 478,695 478,375
4,277,294 4,833,735
UNITED STATES - 1.95%
2,666 360 Communications Co. 47,005 63,984
8,000 Sprint Corp.** 218,542 336,000
20,000 Total Petroleum North America LTD 169,720 195,000
435,267 594,984
TOTAL COMMON STOCKS (ADR's) - 76.31% 19,314,899 23,336,675
<CAPTION>
Market
Face Amount Description Cost Value
</CAPTION>
SHORT-TERM CORPORATE NOTES - 13.03%
$ 500,000 AIG Funding Corp., 5.30%, due July 23, 1996 498,307 498,307
500,000 Chevron Oil Finance Co., 5.32%, due
August 6, 1996 497,266 497,266
500,000 Dover Corp., 5.34%, due July 17, 1996 498,739 498,739
500,000 Gannett Co., Inc., 5.34%, due July 19, 1996 498,591 498,591
500,000 General RE Corp., 5.38%, due August 9, 1996 497,011 497,011
500,000 Lilly Eli & Co., 5.34%, due July 26, 1996 498,072 498,072
500,000 Toys 'R' Us, 5.32%, due July 12, 1996 499,113 499,113
500,000 Toys 'R' Us, 5.36%, due July 30, 1996 497,767 497,767
TOTAL SHORT-TERM CORPORATE NOTES - 13.03% 3,984,866 3,984,866
REPURCHASE AGREEMENT - 10.37%
3,170,000 Northern Trust Co., 5.30%, due July 1, 1996
(Collateralized by $3,163,000
par value U.S. Treasury Notes,
6.125%, due March 31, 1998
delivery value $3,170,528) 3,170,000 3,170,000
TOTAL INVESTMENTS - 99.71% $ 26,469,765 30,491,541
Other assets less liabilities - 0.29% 88,449
TOTAL NET ASSETS - 100.00%
(equivalent to $12.90 per share; 10,000,000
shares of $1.00 par value capital shares
authorized; 2,370,681 shares outstanding) $ 30,579,990
For federal income tax purposes, the identified cost of
investments owned at June 30, 1996 was $26,469,765.
Net unrealized appreciation for federal income tax
purposes was $4,021,776, which is comprised of unreal-
ized appreciation of $4,457,571 and unrealized
depreciation of $435,795.
ADR - American Depository Receipt
<FN>
<F1> * Non-income producing security
<F2> **Non ADR
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
June 30, 1996
<TABLE>
<S> <C>
ASSETS:
Investment securities, at market value (identified cost $26,469,765) $ 30,491,541
Dividends receivable 91,943
Interest receivable 934
Total assets 30,584,418
LIABILITIES:
Disbursements in excess of demand deposit cash $ 4,428
Total liabilities 4,428
NET ASSETS $ 30,579,990
NET ASSETS CONSIST OF:
Capital (capital stock and paid-in capital) $ 26,506,500
Accumulated undistributed income:
Net investment income 23,987
Accumulated net realized gain on investment transactions 27,727
Net unrealized appreciation of investments 4,021,776
NET ASSETS APPLICABLE TO OUTSTANDING SHARES $ 30,579,990
Capital shares, $1.00 par value
Authorized 10,000,000
Outstanding 2,370,681
NET ASSET VALUE PER SHARE $ 12.90
</TABLE>
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS
Statement of Operations
For the Period of January 1, 1996 to June 30, 1996
<TABLE>
<S> <C>
INVESTMENT INCOME:
Income:
Dividends $ 301,916
Interest 153,412
455,328
Expenses:
Management fees 115,973
Governmental fees 3,234
119,207
Net investment income 336,121
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Realized gain from investment transactions (excluding repurchase agreements
and short-term corporate notes):
Proceeds from sales of investments 535,426
Cost of investments sold 429,587
Net realized gain from investment transactions 105,839
Unrealized appreciation of investments:
Beginning of year 2,297,356
End of year 4,021,776
Net unrealized appreciation of investments 1,724,420
Net gain on investments 1,830,259
Net increase in net assets resulting from operations $ 2,166,380
</TABLE>
See accompanying Notes to Financial Statements.
FINANCIAL STATEMENTS
Statements of Changes in Net Assets
For the Period of January 1, 1996 to June 30, 1996
and the Year Ended December 31, 1995
<TABLE>
<CAPTION>
January 1, 1996 January 1, 1995
to June 30, to December 31,
1996 1995
</CAPTION>
<S> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income $ 336,121 $ 402,430
Net realized gain from investment transactions 105,839 222,242
Net unrealized appreciation (depreciation) of investments 1,724,420 2,159,852
Net increase in net assets resulting from operations 2,166,380 2,784,524
DISTRIBUTIONS TO SHAREHOLDERS FROM:*
Net investment income (321,601) (392,963)
Net realized gain from investment transactions (97,877) (232,728)
Total distributions to shareholders (419,478) (625,691)
INCREASE FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from 517,218 and 550,555 shares sold 6,520,012 6,333,198
Net asset value of 20,521 and 32,639 shares issued for
reinvestment of distributions 264,093 386,875
6,784,105 6,720,073
Cost of 133,153 and 255,945 shares redeemed (1,704,205) (2,885,563)
Net increase from capital share transactions 5,079,900 3,834,510
Total increase in net assets 6,826,802 5,993,343
NET ASSETS:
Beginning of year 23,753,188 17,759,845
End of year (including undistributed net investment
income [loss] of $23,987) $ 30,579,990 23,753,188
*Distributions to shareholders:
Income dividends per share $ 0.14 $ 0.22
Capital gains distribution per share $ 0.04 $ 0.12
</TABLE>
See accompanying Notes to Financial Statements.
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
The Fund was capitalized on March 5, 1993 and initial public
offering was made on September 14, 1993. The Fund is registered
under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. Effective on
April 24, 1996, the Fund's share-holders approved a change in the
fiscal year-end. A summary of significant accounting policies that
the Fund uses in the preparation of its financial statements
follows. The policies are in conformity with generally accepted
accounting principles.
Investments - Securities traded on a national securities exchange
are valued at the last reported sales price on the last business
day of the period or, if no sale was reported on that date, at the
average of the last reported bid and asked prices. Investment
transactions are recorded on the date securities are purchased or
sold. Dividend income and distributions to shareholders are
recorded on the ex-dividend dates. Realized gains and losses from
investment transactions and unrealized appreciation and
depreciation of investments are reported on the identified cost
basis. Short-term investments are valued at cost with interest
income recorded on the accrual basis.
Federal Income Taxes - The Fund has complied with the Internal
Revenue Code requirements applicable to regulated investment
companies and will distribute all income to its shareholders.
Therefore, no Federal income tax provision is required.
Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported amount
of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
2. PURCHASES AND SALES OF SECURITIES - The aggregate amounts of
security transactions during the period of January 1, 1996 to
June 30, 1996 (excluding repurchase agreements and short-term
securities), are as follows:
Other than
U.S. Government U.S. Government
Securities Securities
Purchases $ 2,658,869 $ -
Proceeds from sales 535,426 -
3. MANAGEMENT FEES - UMB Bank, n.a. is the Fund's manager and
investment adviser and provides or pays the cost of all
management, supervisory and administrative services required in
the normal operation of the Fund. This includes investment
management; fees of the custodian, independent public accountants
and legal counsel; remuneration of officers and directors; rent;
and shareholder services, including maintenance of the
shareholders accounting system and transfer agency. Not considered
normal operating expenses and therefore payable by the Fund are
taxes, interest, fees and the other charges of governments and
their agencies for qualifying the fund's shares for sale, special
accounting and legal fees and brokerage commissions. UMB Bank's
management fees are based on average daily net assets of the Fund
at the annual rate of .85 of one percent of net assets. Certain
officers and/or directors of the Fund are also officers and/or
directors of Jones & Babson, Inc., which serves as the Fund's
underwriter and distributor.
4. REPURCHASE AGREEMENTS - Securities purchased under agreements
to resell are held by the Fund's custodian and investment counsel,
UMB Bank, n.a. The custodian monitors the market values of the
underlying securities which they have purchased on behalf of the
Fund to ensure that they are sufficient to protect the Fund in the
event of default by the seller.
FINANCIAL HIGHLIGHTS
Per share income and capital changes for a share
outstanding throughout the period.
<TABLE>
<CAPTION>
January 1, Years September 14,
1996 to Ended 1993 to
June 30, December 31, December 31,
1996** 1995 1994 1993*
</CAPTION>
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 12.08 $ 10.84 $ 10.68 $ 10.13
Income from investment operations:
Net investment income 0.14 0.22 0.17 0.03
Net gains or losses on securities
(both realized and unrealized) 0.86 1.36 0.23 0.55
Total from investment operations 1.00 1.58 0.40 0.58
Less distributions:
Dividends from net investment income (0.14) (0.22) (0.17) (0.03)
Distributions from capital gains (0.04) (0.12) (0.07) -
Total distributions (0.18) (0.34) (0.24) (0.03)
Net asset value, end of period $ 12.90 $ 12.08 $ 10.84 $ 10.68
Total return 17% 15% 4% 21%
Ratios/Supplemental Data
Net assets, end of year (in millions) $ 31 $ 24 $ 18 $ 6
Ratio of expenses to average net assets 0.85% 0.85% 0.85% 0.85%
Ratio of net investment income
to average net assets 2.40% 1.97% 1.87% 1.43%
Portfolio turnover rate 5% 27% 24% 2%
Average commission rate*** .0468% - - -
<FN>
<F1> *The Fund was capitalized on March 5, 1993 with $100,000, representing
10,000 shares at a net asset value of $10.00 per share.
Initial public offering was made on September 14, 1993, at which time
net asset value was $10.13 per share.
Ratios for this initial period of operation are annualized.
<F2> **Ratios for this period of operation are annualized.
<F3>***For fiscal years beginning on or after September 1, 1995, a fund is
required to disclose its average commission rate per share for
security trades on which commissions are charged. This amount may
vary from period to period and fund to fund depending on
the mix of trades executed in various markets where trading practices
and commission rate structures may differ.
</FN>
</TABLE>
See accompanying Notes to Financial Statements.
INDEPENDENT ACCOUNTANTS' REPORT
To the Shareholders and Board of Directors
of Scout WorldWide Fund, Inc.:
We have audited the accompanying statement of assets and
liabilities of Scout WorldWide Fund, Inc., including the statement
of net assets, as of June 30, 1996, and the related statement of
operations, statements of changes in net assets and the financial
highlights for the periods indicated thereon. These financial
statements and financial highlights are the responsibility of the
Company's management. Our responsibility is to express an opinion
on these financial statements and financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. Our procedures included verification of securities
owned as of June 30, 1996 by confirmation, or by the application
of alternative auditing procedures with respect to unsettled
portfolio security transactions. An audit also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of Scout WorldWide Fund, Inc. as of June 30,
1996, the results of its operations, the changes in its net assets
and the financial highlights for the periods indicated thereon in
conformity with generally accepted accounting principles.
BAIRD, KURTZ & DOBSON
Kansas City, Missouri
July 23, 1996
This report has been prepared for the information of the
Shareholders of Scout WorldWide Fund, Inc., and is not to
be construed as an offering of the shares of the Fund. Shares
of this Fund and of the other Scout Funds are offered only by
the Prospectus, a copy of which may be obtained from
Jones & Babson, Inc.
This page left blank intentionally.
BOARD OF DIRECTORS
AND OFFICERS
Board of Directors
Larry D. Armel
William E. Hoffman, D.D.S.
Eric T. Jager
Stephen F. Rose
Stuart Wien
Officers
Larry D. Armel, President
P. Bradley Adams, Vice President & Treasurer
Michael A. Brummel, Vice President
Martin A. Cramer, Vice President & Secretary
John G. Dyer, Vice President
Investment Counsel
UMB Bank, n.a., Kansas City, Missouri
Auditors
Baird, Kurtz & Dobson, Kansas City, Missouri
Legal Counsel
Stradley, Ronon, Stevens & Young,
Philadelphia, Pennsylvania
John G. Dyer, Kansas City, Missouri
Custodian
UMB Bank, n.a., Kansas City, Missouri
JONES & BABSON
MUTUAL FUNDS
P.O. Box 410498
Kansas City, MO 64141-0498
TOLL-FREE 1-800-996-2862
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
Scout WorldWide Fund, Inc.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-END> JUN-30-1996
<INVESTMENTS-AT-COST> 26469765
<INVESTMENTS-AT-VALUE> 30491541
<RECEIVABLES> 92877
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 30584418
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 4428
<TOTAL-LIABILITIES> 4428
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 26506500
<SHARES-COMMON-STOCK> 2370681
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 23987
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 27727
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 4021776
<NET-ASSETS> 30579990
<DIVIDEND-INCOME> 301916
<INTEREST-INCOME> 153412
<OTHER-INCOME> 0
<EXPENSES-NET> 119207
<NET-INVESTMENT-INCOME> 336121
<REALIZED-GAINS-CURRENT> 105839
<APPREC-INCREASE-CURRENT> 1724420
<NET-CHANGE-FROM-OPS> 2166380
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 321601
<DISTRIBUTIONS-OF-GAINS> 97877
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 517218
<NUMBER-OF-SHARES-REDEEMED> 133153
<SHARES-REINVESTED> 20521
<NET-CHANGE-IN-ASSETS> 6826802
<ACCUMULATED-NII-PRIOR> 23987
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 115973
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 119207
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 12.08
<PER-SHARE-NII> .14
<PER-SHARE-GAIN-APPREC> .86
<PER-SHARE-DIVIDEND> .14
<PER-SHARE-DISTRIBUTIONS> .04
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.90
<EXPENSE-RATIO> .85
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
