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.
Quarterly Report
September 30, 1997
TO THE SHAREHOLDERS
Scout WorldWide Fund earned a total return (price change and reinvested
distributions) of 5.25% for the quarter ended September 30, 1997. This
compares with the unmanaged Standard & Poor's 500 index, which earned 7.49%,
and the Morgan Stanley Capital International (MSCI) EAFE (Europe, Asia and Far
East) index, which was down 0.64% for the same period.
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 the
original cost. Along with the potential for higher returns, international
investments carry some additional risks from currency fluctuations, economical
and political factors, as well as differences in accounting.
Markets around the world were up last quarter, although there were a few
notable exceptions, including Japan and several Southeast Asian countries.
Much of the Fund's good results relative to the EAFE index resulted from our
continued underweighting in Japanese investments and the absence of
investments in Southeast Asia.
The quarter's big news in international investing was the collapse of
currencies and markets in several Southeast Asian countries, led by Thailand
and followed by Malaysia, Indonesia and the Philippines. These countries have
gone through a typical boom and bust cycle, as is common in emerging markets.
They promise great long-term growth, but there are some big bumps in the road
along the way. We thus are very cautious about investing in the emerging
markets.
The Southeast Asian collapse will affect the Fund in a number of ways, despite
the lack of investments there. The most general effect will be to hold down
prices for many of the consumer goods produced in these areas, because a
cheaper currency is in effect a price cut. One reason for low U.S. inflation
is the strength of the dollar and the weakness of foreign currencies. Lower
cost imports limit the ability of domestic producers to raise prices.
An economic downturn in the region will follow the collapse of the currency
and stock markets. Such a downturn will mean private and public construction
projects will have to be canceled or postponed. The Fund invests in some
companies that export products to these countries, including machinery, such
as electrical generators, and consumer goods, such as cars. These firms may
feel the affect of the downturn through reduced demand for their products.
While we tend to think in terms of the potential impact on the U.S. and its
companies, it is worth noting that Southeast Asia accounts for only about 10%
of our exports, primarily capital goods. Other countries will feel a greater
effect. For example, Southeast Asia accounts for 30% of Japan's exports.
In the last quarter, we have started using one new company in the fund: Aegon,
a Dutch insurance company, active in life insurance and annuities as well as
property and casualty insurance. Its ADRs are listed on the New York Stock
Exchange (NYSE).
Hoechst, the German chemical company which owns Hoechst Marion Rousell of
Kansas City, MO, has listed its ADRs on the NYSE. They previously were traded
over-the-counter. One advantage of the NYSE listing is the requirement for the
company to publish its financial reports in accordance with the Generally
Accepted Accounting Principles (GAAP) of the U.S., which provide greater
disclosure than traditional German financial statements.
We appreciate your interest and participation in Scout WorldWide Fund, and
welcome your questions and comments.
Sincerely,
/S/James L. Moffett
James L. Moffett
UMB Investment Advisors
Shares of the Scout Funds are not deposits or obligations of, nor guaranteed
by, UMB Bank, n.a. or any other banking institution, nor are they insured by
the Federal Deposit Insurance Corporation or any other deposit insurance.
These shares involve investment risks, including the possible loss of the
principal amount invested.
FINANCIAL STATEMENTS
Statement of Net Assets
September 30, 1997
Market
Shares Company Value
COMMON STOCKS (ADR's) - 82.53%
ARGENTINA - 1.31%
20,000 YPF Sociedad Anonima $ 737,500
AUSTRIA - 1.25%
4,700 OMV A.G. * 701,426
AUSTRALIA - 3.32%
20,000 Amcor Ltd. 510,000
26,580 Broken Hill Proprietary Co. Ltd. 622,969
19,380 Coles Myer Ltd. 727,961
1,860,930
BELGIUM - 0.27%
2,500 Solvay NPV* 150,916
BRAZIL - 2.49%
24,000 Aracruz Celulose SA 493,500
7,040 Telecomunicacoes Brasileiras 906,400
1,399,900
CANADA - 4.99%
20,000 BCE Inc.* 597,500
28,500 Canadian Pacific Ltd.* 842,531
15,000 Imperial Oil Ltd. 862,500
7,200 Magna International Cl. A* 497,700
2,800,231
CHILE - 1.18%
8,000 Sociedad Quimica Minera De Chile 472,000
7,500 Embotelladora Andina SA De Chile 193,125
665,125
DENMARK - 1.76%
17,800 Novo-Nordisk A.S. 989,013
FINLAND - 2.27%
13,600 Nokia, CP ADS, Pfd. 1,275,850
FRANCE - 7.55%
29,458 Alcatel Alsthom 782,478
1,090 Carrefour Supermarche, SA * 679,296
23,400 Rhone-Poulenc SA 946,237
12,200 Schlumberger Ltd. 1,027,088
14,035 Total SA 804,381
4,239,480
GERMANY - 9.92%
15,000 Daimler Benz A.G. 1,235,625
24,700 Dresdner Bank A.G. 1,135,575
8,500 Henkel KGAA, Pfd. * 481,262
13,000 Hoechst A.G. 586,625
4,140 SAP A.G.* 1,064,190
15,800 Siemens A.G. 1,067,684
5,570,961
IRELAND - 2.05%
23,000 Elan Corp. PLC 1,151,438
ITALY - 5.63%
24,960 Benetton Group S.p.A. 837,720
17,200 Luxottica Group S.p.A. 979,325
20,000 Telecom Italia S.p.A. 1,342,500
3,159,545
JAPAN - 7.69%
5,700 Canon Inc. 832,200
20,000 Fuji Photo Film Ltd. 827,500
2,900 Hitachi, Ltd. 255,744
3,100 Ito Yokado, Ltd. 664,950
11,000 Sony Corp. 1,033,312
11,500 Toyota Motor Corp. 701,500
4,315,206
NETHERLANDS - 4.79%
12,000 Aegon N.V. 956,250
2,700 Akzo N.V. 231,187
17,190 Koninklijke Ahold N.V. 466,279
18,000 Polygram N.V. 1,033,875
2,687,591
NORWAY - 0.38%
3,555 Norsk Hydro A.S. 212,633
SPAIN - 2.80%
21,000 Repsol S.A. 910,875
7,000 Telefonica De Espana S. A. 658,875
1,569,750
SWEDEN - 5.01%
15,900 Aktiebolaget Electrolux 1,248,150
26,000 Ericsson (L.M.) Telephone Co. Cl. B. 1,246,375
12,500 Svenska Cellulosa Aktiebol* 315,695
2,810,220
SWITZERLAND - 3.10%
4,280 ABB A.G. 631,270
8,650 Nestle S.A. 603,361
6,613 Novartis A. G. 507,721
1,742,352
UNITED KINGDOM - 14.06%
40,000 Bass Public Ltd. Co. 1,100,000
22,969 Cadbury Schweppes Ltd. PLC 888,613
14,200 Carlton Communications PLC 596,400
18,495 Grand Metropolitan Ltd. PLC 721,305
15,200 Reuters Holdings PLC 1,083,000
61,222 Royal Bank of Scotland PLC * 682,393
18,000 SmithKline Beecham PLC 879,750
5,000 Unilever PLC 593,437
13,000 Vodafone Group 698,750
80,000 Waste Management International 650,000
7,893,648
UNITED STATES - 0.71%
8,000 Sprint Corp. * 400,000
TOTAL COMMON
STOCKS (ADR's) - 82.53% 46,333,715
Face Market
Amount Description Value
SHORT-TERM CORPORATE NOTES - 11.54%
$ 500,000 American Greetings Corp.,
5.50%, due October 16, 1997 498,778
500,000 Ameritech Corp.,
5.47%, due October 8, 1997 499,392
1,000,000 American Telephone & Telegraph Co.,
5.50%, due October 14, 1997 997,861
500,000 Atlantic Richfield Co.,
5.49%, due November 7, 1997 497,103
500,000 Gillette Co.,
5.47%, due October 31, 1997 497,645
500,000 Monsanto Co.,
5.51%, due October 3, 1997 499,770
500,000 Penney's (J.C.) Co.,
5.48%, due October 7, 1997 499,467
500,000 Penney's (J.C.) Co.,
5.49%, due November 4, 1997 497,331
1,000,000 Progress Cap Holdings Inc.,
5.50%, due October 15, 1997 997,708
500,000 Progress Cap Holdings Inc.,
5.52%, due October 24, 1997 498,160
500,000 Xerox Corp.,
5.52%, due October 29, 1997 497,777
TOTAL SHORT-TERM
CORPORATE NOTES - 11.54% 6,480,992
GOVERNMENT SPONSORED
ENTERPRISES - 1.77
$ 500,000 Federal Agricultural
Mortgage Corporation,
5.40%, due October 1, 1997 499,925
500,000 Federal National Mortgage
Association,
5.37%, due December 9, 1997 494,779
TOTAL GOVERNMENT
SPONSORED ENTERPRISES - 1.77% 994,704
REPURCHASE AGREEMENT - 5.90%
3,310,000 Northern Trust Co.,
6.00%, due October 1, 1997
(Collateralized by U.S.
Treasury Notes, 6.00%,
due November 30, 1997) 3,310,000
TOTAL INVESTMENTS - 101.74% 57,119,411
Other assets less liabilities - (1.74%) (977,145)
TOTAL NET ASSETS - 100.00%
(equivalent to $16.84 per share;
10,000,000 shares of $1.00 par
value capital shares authorized;
3,334,603 shares outstanding) $ 56,142,266
ADR - American Depository Receipt
*Non ADR
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.
BASIS OF DETERMINING MARKET VALUE. Each investment is valued at the latest
sales price on September 30, 1997, as reported by the principal exchange on
which the issue is listed. If no sale is reported, or if unlisted, the
average of the latest bid and asked price is used.
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
Constance E. Martin, 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
JB25C
