<PAGE>
[STRONG LOGO]
THE STRONG
CONSERVATIVE
EQUITY FUNDS
- -------------------------------------------------------------------------
SEMI-ANNUAL REPORT o APRIL 30, 1999
[PICTURE OF STRONG FUNDS BUILDING]
The Strong American Utilities Fund
The Strong Asset Allocation Fund
The Strong Blue Chip 100 Fund
The Strong Equity Income Fund
The Strong Growth and Income Fund
The Strong Limited Resources Fund
The Strong Total Return Fund
<PAGE>
LETTER FROM THE CHAIRMAN
Dear Strong Investor,
The other day, in the space of less than 24 hours, you could have heard that:
o The bull-market run for big Blue Chip stocks is over.
o The bull-market run for big-company stocks could last another five years.
o Small cap stocks will outperform big-company stocks for the next 10
years.
o Small-caps will lag large caps for the foreseeable future.
o Inflation is coming back with a vengeance.
o There's no real sign of inflation on the horizon.
o Rates will rise for the rest of the year.
o The Fed has no plans to touch rates for the rest of 1999.
o Asia is on the mend.
o Asia is still in the tank.
Interestingly, all of those observations were all provided by well-respected
professionals in the investment community -- which goes to show that in the
world of investing, even smart people differ. Nobody has a corner on the market
for insight but practically everyone has an opinion. And there are more ways
than ever today to share your convictions. Technology has seen to that.
Nowadays, information travels faster than the speed of thought, which is both a
blessing and a curse. On the one hand, it's wonderful to have such resources
literally at the tip of your fingers. On the other hand, it's overwhelming to
have so much information, much of it conflicting, coming at you like a bullet
train.
The trick is to have a plan that will keep you on the right financial track.
Figure out where you're going, how much time you have to get there, and
calculate your tolerance for risk. Then set your financial goals and stick with
them. Don't get derailed by the whirl of information that technology offers.
Meanwhile, day trading is fast replacing baseball as the national pastime. If
you believe just a small percentage of what you read, anyone with a laptop and a
modem is practically guaranteed financial independence overnight. Don't believe
it. There is a mountain of research out there that demonstrates conclusively
that the success rate of investors day trading in the securities and commodities
markets is pretty low.
Money--relative to history--just isn't that easy to make, or keep.
Do you want to increase your chances for financial success? Set your goals.
Devise an intelligent plan that suits your profile. Then discipline yourself to
ignore all that informational clutter.
The realization of long term financial goals requires a lot of planning and even
more patience.
/s/Dick
<PAGE>
THE STRONG
CONSERVATIVE EQUITY
FUNDS
---------------
SEMI-ANNUAL REPORT o APRIL 30, 1999
TABLE OF CONTENTS
INVESTMENT REVIEWS
The Strong American Utilities Fund ..............................2
The Strong Asset Allocation Fund ................................4
The Strong Blue Chip 100 Fund ...................................6
The Strong Equity Income Fund ...................................8
The Strong Growth and Income Fund ..............................10
The Strong Limited Resources Fund ..............................12
The Strong Total Return Fund ...................................14
FINANCIAL INFORMATION
Schedules of Investments in Securities
The Strong American Utilities Fund ........................16
The Strong Asset Allocation Fund ..........................16
The Strong Blue Chip 100 Fund .............................19
The Strong Equity Income Fund .............................21
The Strong Growth and Income Fund .........................23
The Strong Limited Resources Fund .........................24
The Strong Total Return Fund ..............................25
Statements of Assets and Liabilities ...........................28
Statements of Operations .......................................29
Statements of Changes in Net Assets ............................30
Notes to Financial Statements ..................................34
FINANCIAL HIGHLIGHTS ................................................37
<PAGE>
==================
THE STRONG AMERICAN UTILITIES FUND
- ----------------------------------==================----------------------------
FUND
HIGHLIGHTS
o For the six months ended April 30, 1999, the Strong American Utilities Fund
returned 10%, compared to 10.91% for the Lipper Utility Funds Index and
2.94% for the S&P Utilities Index--the Fund's benchmark.*
o Energy exposure was increased in anticipation of rising oil prices. The
Fund benefited because the Organization of Petroleum Exporting Countries'
agreement to cut oil production has, in fact, resulted in a meaningful oil
price recovery and rising energy-stock prices.
o Telephones were the best- performing sector of the Fund.
- ---------------------------------------
YIELD SUMMARY(1)
As of 4-30-99
30-day annualized
yield 2.34%
- ---------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(2)
As of 4-30-99
1-year 17.29%
3-year 19.75%
5-year 18.29%
Since Inception 15.99%
(on 7-1-93)
- ---------------------------------------
FIVE LARGEST STOCK
HOLDINGS
Based on net assets as of 4-30-99
SECURITY % OF NET ASSETS
- ---------------------------------------
Ameritech Corporation 6.6%
Alltel Corporation 6.5%
NiSource, Inc. 5.9%
Enron Corporation 5.9%
Ameren Corporation 5.6%
Please see the Schedule of Investments
in Securities for a complete listing
of the Fund's portfolio.
PERSPECTIVES
FROM THE MANAGER
/s/ William H. Reaves
William H. Reaves
Portfolio Manager
- --------------------------------------------------------------------------------
An upward spike in interest rates in February produced a characteristic sell-off
of utility stocks. In addition, investors who purchased utilities in the
aftermath of last summer's global economic uncertainty sold their utility
investments and shifted their investments back to more aggressive areas as fear
subsided and the stock market resumed its powerful upward trend. As a result,
electric and gas utilities are priced, in our view, at an exceptionally large
discount to the broad market averages.
We believe investors are presented currently with an exceptional opportunity to
invest in a utilities portfolio. Electric and gas utilities represent about 47%
of the Fund's portfolio. Among the many factors that can work to change
attitudes and attract interest to electric and gas utilities are:
1. The electric and gas utility industries are consolidating into fewer,
larger, and stronger companies. The companies are establishing platforms
and revealing their long-term focus and strategies to deliver two to three
times traditional electric- and gas-utility earnings growth. Indicated
growth prospects of 8% to 10% are fast becoming the standard.
2. An earnings growth rate of 8% to 10% should, over the long term, be very
attractive to investors. Many utilities also produce above-average dividend
yields, creating a powerful compounding effect.
-------------------------------------
WE BELIEVE
INVESTORS ARE
PRESENTED CURRENTLY
WITH A GREAT
OPPORTUNITY TO
INVEST IN A
UTILITIES PORTFOLIO.
-------------------------------------
- --------------------------------------------------------------------------------
1 Yields are historical and do not represent future yields, which will
fluctuate.
2 Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of dividends and capital
gains. Average annual total return reflects annualized change while total
return reflects aggregate change, and is not annualized.
The American Utilities Fund is a non-diversified sector fund. As such, it
may concentrate its assets in fewer individual holdings than a diversified
fund may, and it may concentrate its investments in the utilities sector.
Therefore, the Fund is more exposed to individual stock volatility and
negative market pressures in the utilities sector.
2
<PAGE>
3. The premium price that buyers are willing to pay to acquire electric and
gas companies should favorably influence stock prices in due course.
Additional positive factors previously mentioned in our annual report to you
include deregulation and restructuring of utilities across the U.S., and large
stock buybacks over the next few years.
In view of their significant price appreciation, we reduced the holdings of the
telephone group moderately through selling on price strength. The telephone
holdings' double-digit growth outlook for 1999 and 2000 remains unchanged, and
as of now, the stocks are again priced at a discount to the market. We will be
alert for opportunities to increase exposure to this group as uncertainties
related to increasing competition, merger approvals, long-distance entry, and
other regulatory issues lessen.
Any further recovery in Southeast Asian economies and a return to more normal
winter weather in the Northern Hemisphere could lead to a meaningful increase in
oil and gas prices. Given the cost-cutting efforts of recent years, higher
energy prices stand to have an outsized influence on earnings.
Thank you for your continued confidence in the Strong American Utilities Fund.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 7-1-93 to 4-30-99
THE STRONG
AMERICAN S&P 500 Lipper Utility S&P Utilities
UTILITIES FUND Stock Index* Funds Index* Index*
6-93 10,000 10,000 10,000 10,000
12-93 10,450 10,496 10,167 10,090
12-94 10,178 10,635 9,223 9,289
12-95 13,939 14,631 11,724 13,193
12-96 15,106 17,991 12,817 13,605
12-97 19,270 23,993 16,113 16,958
12-98 23,190 30,849 19,077 19,462
4-99 23,760 33,641 19,590 19,181
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Standard & Poor's 500 Stock Index ("S&P 500"), the Lipper Utility Funds Index
and the S&P Utilities 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.
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market. The Lipper Utility Funds Index is an equally-weighted
performance index of the largest qualifying funds in this Lipper category.
The S&P Utilities Index is an unmanaged index generally representative of
the U.S. market for utility stocks. Source of the S&P index data is
Standard & Poor's Micropal. Source of the Lipper index data is Lipper Inc.
YOUR FUND'S
APPROACH
THE STRONG AMERICAN UTILITIES FUND INVESTS PRIMARILY IN PUBLIC UTILITY COMPANIES
HEADQUARTERED IN THE UNITED STATES. STOCKS ARE PICKED THAT WILL BENEFIT FROM
ECONOMIC, REGULATORY, POLITICAL, OR COMPANY-SPECIFIC CHANGES THAT WE HAVE
IDENTIFIED. THE GOAL IS TO ACHIEVE LONG-TERM GROWTH OF YOUR INVESTMENT WITH A
LEVEL OF RISK BELOW THAT OF THE MARKET AS A WHOLE. DIVIDEND INCOME PLAYS AN
IMPORTANT ROLE IN GROWING VALUE AND LESSENING RISK. CONSEQUENTLY, BOTH DIVIDEND
YIELD AND THE POTENTIAL FOR GROWTH IN DIVIDENDS ARE IMPORTANT CRITERIA WE USE
WHEN SELECTING STOCKS.
- --------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
o Rising interest rates and a return of investor confidence in the broad
market contributed to a sell-off of utility stocks. This has led to
exceptional opportunities in electric and gas stocks.
o The broad market represented by the S&P 500 Stock Index continued a
powerful upward trend, driven by the performance of approximately 20
stocks.
o Interest rates may have reversed an 18-month declining trend in February,
as they rose from a range of 5%-5.21% to as high as 5.69% recently.
3
<PAGE>
================
THE STRONG ASSET ALLOCATION FUND
- -----------------------------------================-----------------------------
FUND
HIGHLIGHTS
o For the period November 1, 1998 through April 30, 1999, the Fund earned a
return of 19.26%, comparing favorably to its benchmark 60/35/5 Balanced
Index and other comparable funds.
o The Federal Reserve's interest rate reductions restored confidence and
liquidity in the marketplace, encouraging investors to again focus on
large-capitalization stocks. This bias benefited the Fund as its allocation
was heavily weighted toward equities, and in particular
large-capitalization stocks.
o The Fund's fixed income allocation gradually rebounded in response to the
Fed's easing stance.
- ---------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 4-30-99
1-year 17.32%
5-year 15.57%
10-year 11.84%
Since Inception 14.54%
(on 12-30-81)
- ---------------------------------------
ASSET ALLOCATIONS
10-31-98 4-30-99
- ---------------------------------------
Stocks 68.4% 63.5%
Bonds 28.9% 28.9%
Short-Term
Investments 2.7% 7.6%
The Fund's asset allocation does not
reflect any futures positions held by
the Fund.
PERSPECTIVES
FROM THE MANAGERS
/s/ Rimas Milaitis /s/ Jeffrey A. Koch /s/ Bradley C. Tank
Rimas Milaitis Jeffrey A. Koch Bradley C. Tank
Portfolio Co-manager Portfolio Co-manager Portfolio Co-manager
- --------------------------------------------------------------------------------
Over the past six months, global monetary authorities fought the ill effects of
the Asian crises. Calls of pending economic depression faded as the months
passed and the U.S. economy continued to act as the consumer of last resort.
With domestic interest rates at low levels and positive employment trends, the
domestic economy continued to work through any impediments placed in its way.
Low inflation and interest rates were a boon to the consumer as spending and
sentiment ran high. Seeking to benefit from these dynamics, the Fund had
significant exposure to the retail sector relative to its benchmark. We captured
the benefits of a strong housing and remodeling market through our investments
in Home Depot and Lowe's Companies, while our investment in Wal-Mart allowed the
Fund to benefit from broad-based consumer-spending strength.
Technology stocks outperformed all sectors of the market by a wide margin during
the period. Inventory levels returned to normal levels from an over-supplied
position, thus restoring industry health. In addition, the telecommunications
and networking industries were the focus of investors as Internet access and
broadband needs emphasized demand. Many companies that were directly or
indirectly involved with the Internet attained marquis status. The Fund's stakes
in America Online, Cisco Systems, and MCI WorldCom allowed us to take advantage
of these very favorable trends.
-------------------------------------
THE FUND BEGAN TO
REBUILD ITS EXPOSURE
TO OIL SHARES THROUGH
INVESTMENTS IN
COMPANIES SUCH AS
BRITISH PETROLEUM
AND EXXON.
-------------------------------------
- --------------------------------------------------------------------------------
1 Average annual total return and total return measure change in the value of
an investment in the Fund, assuming reinvestment of dividends and capital
gains. Average annual total return reflects annualized change while total
return reflects aggregate change, and is not annualized.
4
<PAGE>
During the Asian crises, many commodities saw their prices decline severely, and
the price of oil was no exception. The Fund began to rebuild its exposure to oil
shares through investments in companies such as British Petroleum and Exxon,
allowing us to take advantage of low share valuations, OPEC's agreement to cut
production in order to push oil prices higher, and the global economic healing
process taking shape.
Investors found renewed confidence in financial industry stocks as a result of
the Fed's interest rate cuts. The Fund benefited from this trend by emphasizing
investments in financial companies such as Citigroup and Chase Manhattan.
We're cautiously optimistic in our outlook. The U.S. economy is on solid
economic footing and acting as a major support to the healing world economies.
Positive signs are beginning to emerge from the Asian countries, although any
number of issues may emerge to slow this process.
Thank you for your investment in the Strong Asset Allocation Fund. We look
forward to continuing to help you pursue your investment goals.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-30-81 to 4-30-99
THE STRONG ASSET S&P 500 Lipper Flexible 60/35/5
ALLOCATION FUND Stock Index* Portfolio Average* Balanced Index*
12-81 10,000 10,000 10,000 10,000
12-83 19,344 14,896 15,282 14,383
12-85 25,346 20,853 20,150 19,780
12-87 29,734 26,044 24,988 24,473
12-89 36,104 39,993 32,322 34,088
12-91 44,393 50,557 40,292 42,961
12-93 52,469 59,892 48,465 50,376
12-95 63,028 83,487 59,718 64,595
12-97 81,219 136,906 80,598 91,280
4-99 105,116 191,957 96,254 116,456
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at the Fund's inception, with the performance of
the Standard & Poor's 500 Stock Index ("S&P 500"), the Lipper Flexible Portfolio
Average and the 60/35/5 Balanced 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.
- --------------------------------------------------------------------------------
* The S&P 500 Stock Index is an unmanaged index generally representative of
the U.S. stock market. The Lipper Flexible Portfolio Average represents
funds that allocate their investments across various asset classes,
including domestic common stocks, bonds and money market instruments with a
focus on total return. The 60/35/5 Balanced Index is comprised of 60% S&P
500 Stock Index, 35% Lehman Brothers Intermediate Government/Corporate Bond
Index, and 5% Salomon Brothers 3-Month Treasury Bill Index. The Lehman
Brothers Intermediate Government/ Corporate Bond Index is an unmanaged
index generally representative of government and investment-grade corporate
securities with maturities of 1-10 years. The Salomon Brothers 3-Month
Treasury Bill Index is an unmanaged index generally representative of the
average yield of Three-Month Treasury Bills. Source of the 60/35/5 Balanced
Index and the S&P index data is Standard & Poor's Micropal. Source of the
Lipper index data is Lipper Inc.
YOUR FUND'S
APPROACH
THE STRONG ASSET ALLOCATION FUND INVESTS IN THE THREE MAJOR ASSET CLASSES:
STOCKS, BONDS AND CASH. THIS ALLOCATION IS BASED ON AN EVALUATION OF THE ECONOMY
AND MARKET CONDITIONS. IN AN AVERAGE ENVIRONMENT, THE FUND CONSISTS OF 60%
STOCKS, 35% BONDS AND 5% CASH. THE MANAGERS CHOOSE INDIVIDUAL STOCKS, MOSTLY
LARGE-CAPITALIZATION, THAT STAND TO BENEFIT FROM PROJECTED ECONOMIC AND MARKET
TRENDS. THE FUND'S INTERMEDIATE-TERM BOND INVESTMENTS HELP TEMPER THE VOLATILITY
OF THE FUND'S STOCKS, WHILE CORPORATE AND HIGH-YIELD BOND INVESTMENTS, WITH
YIELDS TYPICALLY HIGHER THAN TREASURIES, GENERATE DIVIDEND INCOME.
- --------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
o By holding to our discipline, we remained fully invested and retained
maximum weighting in equities during the period, allowing us to capture the
upward move in stock prices.
o The economy was able to benefit from the downward move in rates which
provided a huge boost to most non-manufacturing-related industries,
including housing, technology, retail, finance, and autos.
o While the equity market was flirting with new highs, the fixed income
markets were slower to recover. Corporate bonds, both investment grade and
high yield, improved marginally but were nowhere near the valuation levels
that were prevalent prior to this fall's financial market turmoil.
5
<PAGE>
=============
THE STRONG BLUE CHIP 100 FUND
- -------------------------------------=============------------------------------
FUND
HIGHLIGHTS
o For the 6-month period ended April 30, 1999, the Strong Blue Chip 100 Fund
returned 29.08%, handily outperforming its bench-mark, the S&P 500 Stock
Index (S&P 500) which returned 22.32%.*
o Investors continued to demonstrate a preference for the earnings stability
and predictability of large-cap stocks--a trend that benefited the Fund.
o The Fund benefited from its holdings in large-cap technology stocks, an
area strengthened by healthy consumer spending and a widely held optimism
in the profitability of the Internet.
- ---------------------------------------
AVERAGE ANNUAL
TOTAL RETURN(1)
As of 4-30-99
1-year 36.76%
Since Inception 34.60%
(on 6-30-97)
- ---------------------------------------
FIVE LARGEST STOCK
HOLDINGS
Based on net assets as of 4-30-99
SECURITY % OF NET ASSETS
- ---------------------------------------
Microsoft Corporation 4.2%
America OnLine, Inc. 3.9%
Time Warner, Inc. 3.8%
MCI WorldCom, Inc. 3.7%
Wal-Mart Stores, Inc. 3.7%
Please see the Schedule of Investments
in Securities for a complete listing
of the Fund's portfolio.
PERSPECTIVES
FROM THE MANAGER
/s/Karen E. McGrath
Karen E. McGrath
Portfolio Manager
- --------------------------------------------------------------------------------
Over the past 6 months, the Strong Blue Chip 100 Fund benefited from investors'
continued preference for the familiarity and stability of large-cap stocks.
Positive earnings announcements from many of the largest U.S. companies also
boosted blue chips.
Overall, the U.S. economy has continued to show powerful growth, despite recent
predictions of a slowdown by many economists. Interest rate cuts by the Federal
Reserve had a very positive effect on domestic markets, relieving investors of
many worries about impending recession, unstable Asian economies, and credit
tightening at home. These low interest rates, together with very low inflation,
spurred consumer spending to high levels, especially in the technology and
retail sectors.
We sought to take advantage of consumer sentiment in the actively managed
portion of the Fund. In keeping with our strategy of emphasizing companies with
high returns on equity, strong and improving profit margins, and dependable
earnings growth, we overweighted the technology sector with the stocks of
companies such as Microsoft and America Online. Our holdings in giant retailers
like Wal-Mart allowed the Fund to take advantage of the broad-based strength in
consumer spending. During the second half of the period, we increased our
holdings in the financial sector, an area that benefited from renewed investor
interest after the Federal Reserve action last fall.
-------------------------------------
WE SOUGHT TO
TAKE ADVANTAGE
OF POSITIVE
CONSUMER SENTIMENT
IN THE ACTIVELY
MANAGED PORTION
OF THE FUND.
-------------------------------------
- --------------------------------------------------------------------------------
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>
To allow the actively managed portion of the Fund to make a meaningful impact on
performance, we continue to limit these holdings to about 30 companies. Our
strategy was successful, allowing us to outperform the S&P 500 by 6.76% for the
six-month period.
Looking ahead, we expect domestic economic growth to slow somewhat over the next
several months, holding at a more sustainable rate of around 2%. Underlying
fundamentals should continue to favor financial assets and justify high
valuations for common stocks. Signs are pointing toward continued recovery of
global economies, especially in Japan.
There is always the potential for a short-term correction initiated by temporary
lapses in investor confidence. Overall, though, the investment outlook remains
positive. The current domestic environment is a healthy one for large companies
with demonstrated track records--and for the Strong Blue Chip 100 Fund.
Thank you for your investment and continued confidence. We look forward to
serving your investment needs in the future.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 6-30-97 to 4-30-99
THE STRONG Lipper Growth
BLUE CHIP S&P 500 and Income
100 FUND Stock Index* Funds Index*
6-97 10,000 10,000 10,000
9-97 10,750 10,749 10,837
12-97 10,872 11,058 10,943
3-98 12,406 12,600 12,190
6-98 13,233 13,016 12,214
9-98 12,257 11,721 10,691
12-98 15,647 14,218 12,429
3-99 17,342 14,926 12,692
4-99 17,241 15,504 13,515
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at the Fund's inception, with the performance of
the Standard & Poor's 500 Stock Index ("S&P 500") and the Lipper Growth and
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.
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market. The Lipper Growth and Income Funds Index is an
equally-weighted performance index of the largest qualifying funds in this
Lipper category. Source of the S&P 500 index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
YOUR FUND'S
APPROACH
THE STRONG BLUE CHIP 100 FUND INVESTS SOLELY IN THE 100 LARGEST COMPANIES
PRIMARILY PUBLICLY TRADED IN THE UNITED STATES. WITH HALF THE FUND'S ASSETS, THE
MANAGER SELECTS THE 20 TO 30 STOCKS CONSIDERED MOST ATTRACTIVE. THIS
CONCENTRATION IS DESIGNED TO INCREASE RETURNS ABOVE THOSE OF THE 100 COMPANIES
AS A GROUP. IN THE OTHER HALF OF THE PORTFOLIO, THE FUND STAYS ANCHORED IN AN
INDEX OF ALL 100 OF THE LARGEST STOCKS. THIS CAN HELP REDUCE VOLATILITY IN
DIFFICULT MARKETS. THE FUND INVESTS FOR BOTH CAPITAL GROWTH AND INCOME.
- --------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
o Economists waffled in their views between a healthy domestic economy and
concern that its growth might require tightening by the Federal Reserve.
o Moves by the Federal Reserve to cut interest rates over the period went a
long way to restore investor confidence, easing fears of domestic recession
and the Asian crisis.
o Healthy consumer spending drove the retail and financial areas to
exceptionally strong performances. Investors' enthusiastic expectations of
the Internet's potential pushed technology stocks to staggering levels.
o With the exception of energy, all major market sectors produced strong
returns.
7
<PAGE>
=============
THE STRONG EQUITY INCOME FUND
- -------------------------------------=============------------------------------
FUND
HIGHLIGHTS
o For the six-month period ended April 30, 1999, the Fund returned 18.33%,
comparing favorably to other equity income funds but trailed the S&P 500
Stock Index* by 3.99%.
o Rate cuts by the Federal Reserve restored confidence in the market place,
prompting investors to re-accumulate large-cap stocks --a bias that
benefited the Fund.
o Technology stocks outperformed all other sectors with valuations that
boggled the mind--especially Internet stocks. The Fund did not have
exposure to this sector and thus did not benefit from the casino-style
environment that existed during the period.
- ---------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 4-30-99
1-year 15.69%
3-year 24.87%
Since Inception 26.36%
(on 12-29-95)
- ---------------------------------------
TOP FIVE SECTORS
Based on net assets as of 4-30-99
SECTOR % OF NET ASSETS
- ---------------------------------------
Financial 20.1%
Capital Equipment 13.7%
Technology 13.1%
Healthcare 11.5%
Retail 10.6%
Please see the Schedule of Investments
in Securities for a complete listing of
the Fund's portfolio.
PERSPECTIVES
FROM THE MANAGER
/s/ Rimas Milaitis
Rimas Milaitis
Portfolio Manager
- --------------------------------------------------------------------------------
The monetary authorities globally had been combating the ill effects of the
Asian crises throughout the period. Calls of pending economic depression faded
as the months passed and the strong U.S. economy continued to act as the
consumer of last resort. With domestic interest rates at low levels and
employment enjoying positive trends, the U.S. economy continued to work through
the impediments placed before it. Low inflation and interest rates were a boon
to the consumer as spending and sentiment ran high. Seeking to benefit from
these dynamics, the Fund had significant exposure to the retail sector relative
to its benchmark. We captured the benefits of a strong housing and remodeling
market through our investments in Home Depot and Lowe's Companies, two firms
that dominate the do-it-yourself industry. In addition, our investment in
Wal-Mart allowed the Fund to benefit from the broad-based strength in consumer
spending.
During the Asian crises, many commodities saw their prices decline severely, and
the price of oil was no exception. It was during this period that the Fund began
to rebuild its exposure to oil shares through investments such as Exxon and
Chevron corporations. Motivation behind this move was three-fold: low share
valuations fully reflecting the decline in oil prices, OPEC's agreement to cut
oil production to push prices higher, and the global economic healing process
which was taking shape.
-------------------------------------
WE CAPTURED THE
BENEFITS OF A STRONG
HOUSING AND
REMODELING MARKET
THROUGH OUR
INVESTMENTS IN HOME
DEPOT AND LOWES
COMPANIES, TWO FIRMS
THAT DOMINATE THE DO-
IT-YOURSELF INDUSTRY.
-------------------------------------
- --------------------------------------------------------------------------------
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>
The shares of oil companies began to outperform during the latter half of the
period, benefiting Fund performance.
We also emphasized investments in financial companies such as Citigroup and
Chase Manhattan, as they would be direct beneficiaries of the now-positive
global trends in financial markets. The Federal Reserve action early in the
period had gone a long way in restoring investor confidence in
financial-industry stocks.
Our outlook is one of cautious optimism. The U.S. economy is on solid economic
footing and is acting as a major support to the healing world economies.
Positive signs are beginning to emerge from Asian geographies, including
appreciating currencies, rising stock markets, and the re-emergence of export
orders. Fragile as this recovery is, signs of its emergence are unequivocal.
Though the signs look promising, any number of issues may emerge to slow this
process--another crisis, military conflict, or a relapse by any one of the
recovering countries causing further damage. We remain optimistic and expect a
recovery in corporate profits.
Thank you for your support and trust. We look forward to helping you pursue your
financial goals.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-29-95 to 4-30-99
THE STRONG Lipper Equity S&P/Barra
EQUITY S&P 500 Income Funds 500 Value
INCOME FUND Stock Index* Index* Index*
12-95 10,000 10,000 10,000 10,000
6-96 11,296 11,010 10,670 10,857
12-96 12,810 12,296 11,797 12,199
6-97 15,126 14,830 13,558 14,210
12-97 16,822 16,398 15,001 15,856
6-98 19,327 19,303 16,440 17,780
12-98 20,632 21,085 16,767 18,183
4-99 21,812 22,992 17,974 20,313
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Standard & Poor's 500 Stock Index ("S&P 500"), the Lipper Equity Income Funds
Index, and the S&P/Barra 500 Value 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.
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market. The Lipper Equity Income Funds Index is an equally-weighted
performance index of the largest qualifying funds in this Lipper category.
The S&P/Barra 500 Value Index is an unmanaged index generally
representative of the U.S. market for value stocks. Source of the S&P index
data is Standard & Poor's Micropal. Source of the Lipper index data is
Lipper Inc.
YOUR FUND'S
APPROACH
THE STRONG EQUITY INCOME FUND USES A TOP-DOWN ANALYSIS OF THE ECONOMY TO
DETERMINE WHICH SECTORS ARE LIKELY TO ALLOW COMPANIES TO GROW THEIR EARNINGS AND
WHICH ARE NOT. BASED ON THAT ANALYSIS, WE INVEST LARGER OR SMALLER PORTIONS OF
THE FUND'S ASSETS IN EACH OF THE SEVEN MAJOR ECONOMIC SECTORS OF THE S&P 500
STOCK INDEX (S&P 500). WE CHOOSE INDIVIDUAL COMPANIES IN EACH SECTOR THAT WE
BELIEVE WILL BENEFIT MOST FROM THE ECONOMIC ENVIRONMENT WE FORESEE. THE FUND
INVESTS PRIMARILY IN LARGE, DIVIDEND-PAYING COMPANIES.
- --------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
o Our observation of the U.S. economy as sound allowed the Fund to capture
the majority of the market's upward move, and avoid trying to "time the
market."
o The market was willing to take incredible leaps of faith with Internet
companies demonstrating low revenues, higher expenses than revenues, and
questionable future profitability. The Fund shied away from investments in
this area.
o Despite economists' preachings of impending recession, the U.S. economy
benefited from the downward move in interest rates which helped nearly all
non-manufacturing-related industries. The Fund benefited from its emphasis
of many of these areas.
9
<PAGE>
=================
THE STRONG GROWTH AND INCOME FUND
- -----------------------------------=================----------------------------
FUND
HIGHLIGHTS
o During the period November 1, 1998 through April 30, 1999, the Fund
outperformed its benchmark by over 4%, earning a 26.55% return versus a
22.32% return for the S&P 500 Stock Index.*
o Newly confident investors began to re-accumulate shares of blue-chip
companies. Our significant exposure to these stocks benefited the Fund
handsomely.
o Technology stocks handily outperformed all sectors of the market, driven in
part by a healing of computer-related issues and the emergence of the web.
The Fund benefited from an overweight in this sector.
- ---------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 4-30-99
1-year 27.64%
3-year 29.84%
Since Inception 31.65%
(on 12-29-95)
- ---------------------------------------
TOP FIVE SECTORS
Based on net assets as of 4-30-99
SECTOR % OF NET ASSETS
- ---------------------------------------
Technology 27.3%
Financial 16.8%
Capital Equipment 12.9%
Retail 9.4%
Healthcare 8.9%
Please see the Schedule of Investments
in Securities for a complete listing of
the Fund's portfolio.
PERSPECTIVES
FROM THE MANAGER
/s/ Rimas Milaitis
Rimas Milaitis
Portfolio Manager
- --------------------------------------------------------------------------------
Global monetary authorities had been combating the ill effects of the Asian
crises throughout the period. Calls of pending economic depression faded as the
months passed and the U.S. economy continued to act as the consumer of last
resort. With interest rates here at low levels and employment enjoying positive
trends, the domestic economy continued to work through any impediments placed in
its way. Low inflation and interest rates were a boon to the consumer as
spending and sentiment ran high. Seeking to benefit from these dynamics, the
Fund had significant exposure to the retail sector relative to the benchmark. We
captured the benefits of a strong housing and remodeling market through our
investments in Home Depot and Lowe's Companies, while our investment in Wal-Mart
allowed the Fund to benefit from broad-based consumer-spending strength.
The technology sector re-emerged as a market leader during the period. This area
awakened from a slumber caused by a severe glut of computer-related products
that by this time had been worked down, and the health of these industries was
being restored. In addition, the Internet had become a new driver in the
technology field. Companies that were directly or indirectly involved had
attained marquis status. The Fund's stakes in America Online, Cisco Systems, and
MCI WorldCom allowed us to take advantage of these very favorable trends.
During the Asian crises, many commodities saw their prices decline severely, and
the price of oil was no exception. The Fund began to rebuild its exposure to oil
shares through investments in companies such as British Petroleum and Exxon,
-------------------------------------
THE TECHNOLOGY
SECTOR RE-EMERGED
AS A MARKET LEADER
DURING THE PERIOD.
-------------------------------------
- --------------------------------------------------------------------------------
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.
10
<PAGE>
allowing us to take advantage of low share valuations, OPEC's agreement to cut
production in order to push oil prices higher, and the global economic healing
process taking shape.
We emphasized investments in financial companies such as Citigroup and Chase
Manhattan, since they would be direct beneficiaries of the now-positive global
trends in financial markets. The Federal Reserve's moves early in the period had
gone a long way in restoring investor confidence in financial-industry stocks.
Our outlook is one of cautious optimism. The U.S. economy is on solid economic
footing and acting as a major support to the healing world economies. Positive
signs--appreciating currencies, rising stock markets, and the re-emergence of
export orders--are beginning to emerge from the Asian geographies. Fragile as
this recovery is, indications of its emergence are unequivocal. Though the signs
look promising, any number of issues may emerge to slow this process.
Thank you for your support and trust. We look forward to helping you pursue your
financial goals.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-29-95 to 4-30-99
THE STRONG Lipper Growth
GROWTH AND S&P 500 and Income
INCOME FUND Stock Index* Funds Index*
12-95 10,000 10,000 10,000
6-96 11,556 11,010 10,846
12-96 13,191 12,296 12,067
6-97 15,469 14,830 13,992
12-97 17,199 16,398 15,311
6-98 20,447 19,303 17,089
12-98 22,866 21,085 17,390
4-99 25,008 22,992 18,909
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Standard & Poor's 500 Stock Index ("S&P 500") and the Lipper Growth and 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.
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market. The Lipper Growth and Income Funds Index is an
equally-weighted performance index of the largest qualifying funds in this
Lipper category. Source of the S&P 500 index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
YOUR FUND'S
APPROACH
THE STRONG GROWTH AND INCOME FUND USES A TOP-DOWN ANALYSIS OF THE ECONOMY TO
DETERMINE WHETHER TO INVEST EITHER LARGE OR SMALL PORTIONS OF THE FUND'S ASSETS
IN EACH OF THE SEVEN MAJOR ECONOMIC SECTORS OF THE S&P 500 STOCK INDEX (S&P
500). FROM EACH SECTOR, WE THEN CHOOSE THE INDIVIDUAL COMPANIES WE BELIEVE WILL
BENEFIT MOST FROM THE ECONOMIC ENVIRONMENT WE FORESEE. THE FUND INVESTS
PRIMARILY IN LARGE, DIVIDEND-PAYING COMPANIES, BUT MAY INVEST IN SOME SMALLER
COMPANIES UNDER CERTAIN MARKET CONDITIONS.
- --------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
o We held to our strict discipline of watching the big picture in determining
the status of the economic environment here and abroad. It appeared the
U.S. economy was fundamentally sound, so we held our ground as fear and
panic consumed the market early on, allowing the Fund to capture the
market's full upward move.
o The Fund shied away from direct Internet-company investments, with the
exception of America Online.
o Despite economists' preachings of impending recession, the U.S. economy
benefited from the downward move in interest rates which helped nearly all
non-manufacturing-related industries. The Fund benefited from its emphasis
of many of these areas.
11
<PAGE>
=================
THE STRONG LIMITED RESOURCES FUND
- -----------------------------------=================----------------------------
FUND
HIGHLIGHTS
o The Strong Limited Resources Fund appreciated 15.04% in the six months
ended April 30, 1999.
o After underperforming the general market for most of this period, the
resources area began to perform better during the first quarter of 1999 as
Asian economic activity stopped declining, OPEC announced new
oil-production cutbacks, other resource industries curtailed production,
and commodity prices began to improve.
o In the winter, we shifted into a more aggressive posture in recognition of
improved resource-area fundamentals. We increased holdings in the more
volatile energy areas such as oil and gas exploration and oil service, and
in chemicals, copper, steel, paper, and forest products.
- ---------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 4-30-99
1-year -7.61%
Since Inception -6.65%
(on 9-30-97)
- ---------------------------------------
FIVE LARGEST STOCK
HOLDINGS
Based on net assets as of 4-30-99
SECURITY % OF NET ASSETS
- ---------------------------------------
Chevron Corporation 5.0%
YPF Sociedad Anonima ADR 4.0%
E.I. Du Pont de Nemours & Co. 3.7%
Willamette Industries, Inc. 3.6%
Mobile Corporation 3.6%
Please see the Schedule of Investments
in Securities for a complete listing of
the Fund's portfolio.
PERSPECTIVES
FROM THE MANAGER
/s/ Mark A. Baskir
Mark A. Baskir
Portfolio Manager
- --------------------------------------------------------------------------------
The past 18 months have been a turbulent time for both your Fund and the natural
resources area in general. Since the Asian financial crisis began late in 1997,
this area of the market has been impacted by reduced demand for its products
from what was formerly the strongest economic growth area in the world. We are
now witnessing a fundamental recovery in Asia, with signs pointing to renewed
economic growth from the area later in 1999. The outlook is brightening!
In the resources area, most industries have responded to lower demand for their
products by reducing capacity and, in some cases such as chemicals and
aluminums, by acquiring competitors. No area highlights these characteristics
more than the energy area. Specifically, OPEC agreed in March 1999 to reduce
production by 2 million barrels per day. In addition, low oil prices led to
cutbacks in production in uneconomic fields in the United States and Canada, and
to severe spending cuts in the oil industry. Reduced natural gas drilling has
raised concern that natural gas will be in tight supply domestically in the
fall. As a result, oil and gas prices have both risen significantly in the past
few weeks.
We have seen renewed interest in economically sensitive stocks in recent weeks
as fundamentals have improved, and investors shift investments to this area
-------------------------------------
WE EXPECT OIL AND
NATURAL GAS PRICES
TO CONTINUE TO
IMPROVE DURING THE
NEXT SIX MONTHS,
AND THEREFORE WE
HAVE INCREASED OUR
EXPOSURE IN OIL
SERVICE AND OIL AND
GAS EXPLORATION
COMPANIES.
-------------------------------------
- --------------------------------------------------------------------------------
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.
12
<PAGE>
that has underperformed the market for quite some time. Our assessment of the
resource area is that these stocks are still undervalued and should attract more
interest as the developing world's economies improve.
We believe that the economic distress in Southeast Asia, Russia, and Latin
America--as well as a short-term period of oil oversupply--have only delayed the
positive cycle for oil, gas, and other consumable resources. Now that we are
beginning to see a recovery in these fundamentals, we feel that the hiatus in
the appeal of the resource area is ending. Energy should lead this recovery, and
thus remains the principal focus of the Fund. In recognition of the improving
outlook for the resources industries, we have added to positions in the paper
and forest products, chemicals, steel, and copper industries. We expect oil and
natural gas prices to continue to improve during the next six months, and
therefore we have increased our exposure in oil service and oil and gas
exploration companies, which should be the prime beneficiaries of higher prices.
Thank you for your patience and continued interest in the Strong Limited
Resources Fund.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 9-30-97 to 4-30-99
THE STRONG LIMITED S&P 500 Lipper Natural Limited
RESOURCES FUND Stock Index* Resources Average* Resources Index*
9-97 10,000 10,000 10,000 10,000
12-97 9,306 10,287 8,468 9,494
3-98 9,516 11,722 8,778 10,197
6-98 8,626 12,109 7,899 10,110
9-98 7,475 10,905 6,617 9,222
12-98 7,275 13,227 6,388 9,387
3-99 7,635 13,886 6,850 9,780
4-99 8,968 14,424 8,024 11,539
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Standard & Poor's 500 Stock Index ("S&P 500"), the Lipper Natural Resources
Average, and the Limited Resources 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.
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market. The Lipper Natural Resources Average represents funds that
invest more than 65% of its equity commitment in natural resource stocks.
The Limited Resources Index is comprised of 50% S&P Energy Index, 40% S&P
Basic Materials Index and 10% S&P Natural Gas Index. The S&P Energy Index
is an unmanaged index generally representative of the U.S. market for
energy stocks. The S&P Basic Materials Index is an unmanaged index
generally representative of the U.S. market for basic material stocks. The
S&P Natural Gas Index is an unmanaged index generally representative of the
U.S. market for natural gas stocks. Source of the S&P 500 and the Limited
Resources index data is Standard & Poor's Micropal. Source of the Lipper
Natural Resources Average in Lipper Inc.
YOUR FUND'S
APPROACH
THE STRONG LIMITED RESOURCES FUND INVESTS IN ENERGY AND NATURAL RESOURCES
COMPANIES WHICH PROVIDE OPPORTUNITIES FOR CAPITAL APPRECIATION INCOME. WHEN
ASSESSING INVESTMENTS WE STRESS EACH COMPANY'S VALUATION, MANAGEMENT'S TRACK
RECORD AND COMMITMENT, AND ANY UNIQUE CIRCUMSTANCES THAT COULD GENERATE
ABOVE-AVERAGE LONG-TERM RETURNS. WE ALLOCATE THE FUND'S ASSETS TO INDIVIDUAL
RESOURCE SECTORS BASED ON THE ECONOMIC CYCLE AND EACH SECTOR'S ATTRACTIVENESS
RELATIVE TO THE OTHERS'. STOCKS ARE SOLD IF A SIGNIFICANT NEGATIVE CHANGE OCCURS
IN THE COMPANY'S OUTLOOK OR IF THE STOCK SURPASSES OUR INVESTMENT TARGETS.
- --------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
o In recent months, natural resource stocks have performed as well as the
overall market. Investors' renewed interest in the resources area was
prompted by a slowing decline in Asian economic activity, recovery of
international stock markets, and curtailed production of oil, gas, and
other resources.
o Until very recently, the market continued to be driven higher by the same
groups--technology, consumer growth, and financial stocks--that have led
the market for the past few years.
o In the macroeconomic environment, low inflation, moderate interest rates,
and positive earnings results continue to favor the overall stock and bond
markets.
13
<PAGE>
============
THE STRONG TOTAL RETURN FUND
- -------------------------------------============-------------------------------
FUND
HIGHLIGHTS
o The Strong Total Return Fund returned 35.61% for the six-month period ended
April 30, 1999, which compares favorably to the 22.32% return of the S&P
500 Stock Index.*
o The Fund benefited from its focus on high-quality growth stocks, especially
in the retail and financial sectors.
o The uncertainty of many global economies and the potential for a rising
dollar led us to avoid multinational companies and firms exposed to foreign
competition--a strategy that positively affected the Fund's performance.
- ---------------------------------------
AVERAGE ANNUAL
TOTAL RETURNS(1)
As of 4-30-99
1-year 34.47%
5-year 22.32%
10-year 14.30%
Since Inception 17.29%
(on 12-30-81)
- ---------------------------------------
TOP FIVE SECTORS
Based on net assets as of 4-30-99
SECTOR % OF NET ASSETS
- ---------------------------------------
Technology 28.8%
Financial 16.8%
Capital Equipment 11.3%
Energy 8.8%
Retail 7.8%
Please see the Schedule of Investments
in Securities for a complete listing of
the Fund's portfolio.
PERSPECTIVES
FROM THE MANAGERS
/s/ Ronald C. Ognar /s/Ian J. Rogers
Ronald C. Ognar Ian J. Rogers
Portfolio Co-manager Portfolio Co-manager
- --------------------------------------------------------------------------------
The Strong Total Return Fund's focus on carefully chosen, high-quality growth
stocks led to its outperformance of its index over the last six months.
Investors continued to favor large-cap stocks and those companies demonstrating
visible earnings growth--the types of stocks targeted by our investment
approach. Some of our best-performing stocks during the period were Cisco
Systems, Tyco International, and MCI WorldCom.
In the U.S., the consumer remained strong and continued to buy. To take
advantage of this trend, we increased our weighting in top retail stocks such as
Kohl's Corporation. There was a strong increase in demand for technology as
Internet use continued to gain momentum. Early in the reporting period, we moved
cash reserves into leading technology stocks, particularly telecommunications
equipment, and computer- and Internet-related companies. During the last
quarter, however, we grew concerned with the climbing stock prices and
valuations of many of these companies. Despite rising forecasted earnings, we
took profits on some of these investments. In a rising interest-rate
environment--a possibility we anticipate in the months ahead--these
long-duration stocks may enter a period of underperformance. We also selectively
sold some of our retail holdings as valuations grew unacceptably high.
High valuations prompted us to reduce our holdings in pharmaceuticals and
consumer staples. We increased our investments in financial services such as
money-center banks and brokerages, which should continue to benefit from the
-------------------------------------
HIGH VALUATIONS
PROMPTED US
TO REDUCE OUR
HOLDINGS IN
PHARMACEUTICALS
AND CONSUMER
STAPLES.
-------------------------------------
- --------------------------------------------------------------------------------
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.
14
<PAGE>
improving worldwide economic activity and consolidation that are taking place
within the industry.
We believe that the U.S. economy, as well as the stock market, will remain
strong throughout 1999. While we entered the reporting period with the markets
reeling from the effects of Asia and the hedge-fund crisis, the Federal
Reserve's interest rate cuts toward the end of 1998 seem to be causing a
broadening into new leaders for the stock market. Right now, we see few signs of
inflation. If the forecasted rise in economic activity in Asia and Europe
occurs, however, it could initiate a round of higher prices in commodities such
as oil and gas, chemicals, and industrials. We've positioned the Fund to take
advantage of this trend by increasing our investments in these areas.
Overall, we believe the outlook is still good for equities. The Strong Total
Return Fund focuses on large-cap stocks, but has the ability to include mid-cap
stocks. We have started moving in that direction, and have been pleased with the
results. Going forward, we expect to continue adding these stocks, concentrating
on well-established firms at the larger end of the medium-capitalization range.
Thank you for including the Strong Total Return Fund in your investment plan. We
look forward to continuing to serve your investment needs.
GROWTH OF AN ASSUMED $10,000 INVESTMENT
From 12-30-81 to 4-30-99
THE STRONG Lipper Growth S&P/Barra
TOTAL RETURN S&P 500 and Income 500 Growth
FUND Stock Index* Funds Index* Index*
12-81 10,000 10,000 10,000 10,000
12-83 18,720 14,896 15,243 14,184
12-85 25,936 20,853 20,436 19,351
12-87 33,001 26,044 24,673 23,595
12-89 39,140 39,993 36,132 36,028
12-91 48,578 50,557 43,393 49,952
12-93 59,851 59,892 54,528 53,364
12-95 74,963 83,487 71,211 76,021
12-97 106,181 136,906 109,030 128,666
4-99 158,710 191,957 134,656 195,117
This graph, prepared in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Standard & Poor's 500 Stock Index ("S&P 500"), the Lipper Growth and Income
Funds Index, and the S&P/Barra 500 Growth 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.
- --------------------------------------------------------------------------------
* The S&P 500 is an unmanaged index generally representative of the U.S.
stock market. The Lipper Growth and Income Funds Index is an
equally-weighted performance index of the largest qualifying funds in this
Lipper category. The S&P/Barra 500 Growth Index is an unmanaged index
generally representative of the U.S. market for growth stocks. Source of
the S&P 500 and the S&P/Barra 500 Growth Index is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
YOUR FUND'S
APPROACH
THE STRONG TOTAL RETURN FUND SEEKS HIGH TOTAL RETURN BY INVESTING FOR BOTH
CAPITAL GROWTH AND INCOME. THE FUND INVESTS PRIMARILY IN LARGE- AND MEDIUM-SIZED
COMPANIES. WE FOCUS ON FINDING HIGH-QUALITY COMPANIES THAT WE BELIEVE ARE IN A
STRONG PHASE OF PROFIT AND SALES GROWTH. A STOCK MUST ALSO HAVE A PRICE-
TO-EARNINGS RATIO THAT INDICATES IT IS A GOOD VALUE. ONCE A STOCK IS IN THE
PORTFOLIO, IT IS SYSTEMATICALLY MONITORED TO MAKE SURE IT CONTINUES TO MEET YOUR
FUND'S CRITERIA.
- --------------------------------------------------------------------------------
MARKET
HIGHLIGHTS
o The Federal Reserve's move to cut interest rates helped to restore
confidence and liquidity in the U.S. market. Consumer spending remained
strong and inflation was benign--quite favorable conditions for the stocks
of well-run large- and medium-sized companies.
o More firms were able to beat their forecasted earnings estimates. The stock
market playing field began to broaden out, with more companies
participating in the upward movement of the market.
o Asia's economic crisis continued to filter into South America, while
European economies showed signs of weakening.
15
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES APRIL 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
================================================================================
STRONG AMERICAN UTILITIES FUND
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Common Stocks 94.8%
ELECTRIC UTILITY 35.7%
Ameren Corporation 355,400 $ 13,749,537
CMS Energy Corporation 310,300 13,653,200
Dominion Resources, Inc. 26,000 1,069,250
Duke Energy Corporation 178,500 9,996,000
FirstEnergy Corporation 306,600 9,102,187
NiSource, Inc. 526,000 14,596,500
Northern States Power Company 44,000 1,061,500
SCANA Corporation 43,000 1,010,500
The Southern Company 118,200 3,198,788
TECO Energy 336,800 7,178,050
TNP Enterprises, Inc. 41,000 1,281,250
Wisconsin Energy Corporation 440,000 11,825,000
------------
87,721,762
ENERGY RELATED 18.4%
Apache Corporation 56,900 1,746,119
Atlantic Richfield Company 108,900 9,140,794
BP Amoco PLC Sponsored ADR 24,815 2,808,748
Burlington Resources, Inc. 13,000 598,812
Conoco, Inc. Class A 7,700 208,862
Elf Aquitaine SA Sponsored ADR 6,900 539,062
Exxon Corporation 94,000 7,807,875
Imperial Oil, Ltd. 108,100 2,256,587
Kerr McGee Corporation 17,500 741,563
Mobil Corporation 24,400 2,555,900
Petroleum Geo-Services A/S Sponsored ADR (b) 10,000 167,500
Phillips Petroleum Company 3,500 177,188
Royal Dutch Petroleum Company - New York
Registry Shares 178,200 10,458,113
Texaco, Inc. 42,200 2,648,050
USX-Marathon Group 106,100 3,315,625
------------
45,170,798
GAS UTILITY 12.1%
Connecticut Energy Corporation 5,000 186,875
Consolidated Natural Gas Company 46,300 2,754,850
Enron Corporation 192,000 14,448,000
Equitable Resources, Inc. 66,800 1,770,200
Indiana Energy, Inc. 70,000 1,496,250
KeySpan Energy Corporation 60,400 1,615,700
National Fuel Gas Company 10,100 441,875
Oneok, Inc. 60,000 1,676,250
Providence Energy Corporation 10,000 199,375
Questar Corporation 269,000 4,892,437
The Williams Companies, Inc. 3,000 141,750
------------
29,623,562
OTHER UTILITY 0.4%
American Water Works Company, Inc. 36,500 1,037,969
TELECOMMUNICATION 28.2%
AT&T Corporation 125,500 6,337,750
Alltel Corporation 238,000 16,050,125
Ameritech Corporation 237,800 16,274,437
Bell Atlantic Corporation 193,000 11,121,625
BellSouth Corporation 54,700 2,447,825
GTE Corporation 73,000 4,886,438
SBC Communications, Inc. 203,000 11,368,000
Sprint Corporation 2,000 205,125
US WEST, Inc. 7,500 392,344
------------
69,083,669
- --------------------------------------------------------------------------------
Total Common Stocks (Cost $180,984,134) 232,637,760
- --------------------------------------------------------------------------------
Short-Term Investments (a) 4.7%
COMMERCIAL PAPER
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 4.51% 6,882,000 6,882,000
Pitney Bowes Credit Corporation, 4.51% 2,443,700 2,443,700
Sara Lee Corporation, 4.50% 2,246,300 2,246,300
- --------------------------------------------------------------------------------
Total Short-Term Investments (Cost $11,572,000) 11,572,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments in Securities (Cost $192,556,134) 99.5% 244,209,760
Other Assets and Liabilities, Net 0.5% 1,227,227
- --------------------------------------------------------------------------------
Net Assets 100.0% $245,436,987
================================================================================
================================================================================
STRONG ASSET ALLOCATION FUND
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Common Stocks 62.1%
AEROSPACE & DEFENSE 0.6%
United Technologies Corporation 15,100 $ 2,187,612
AUTOMOBILE 0.6%
Ford Motor Company 30,800 1,969,275
BANK - MONEY CENTER 3.5%
Bank of America Corporation 42,700 3,074,400
The Chase Manhattan Corporation 37,200 3,078,300
Citigroup, Inc. 77,000 5,794,250
-----------
11,946,950
BANK - SUPER REGIONAL 2.9%
The Bank of New York Company, Inc. 40,500 1,620,000
Bank One Corporation 26,000 1,534,000
Comerica, Inc. 26,550 1,727,410
First Union Corporation 18,000 996,750
Mellon Bank Corporation 36,500 2,712,406
Wells Fargo Company 31,500 1,360,406
-----------
9,950,972
BEVERAGE - ALCOHOLIC 0.6%
Anheuser-Busch Companies, Inc. 26,200 1,915,875
BEVERAGE - SOFT DRINK 1.1%
The Coca-Cola Company 40,100 2,726,800
PepsiCo, Inc. 29,000 1,071,188
-----------
3,797,988
BROKERAGE & INVESTMENT MANAGEMENT 0.2%
Morgan Stanley, Dean Witter & Company 5,200 515,775
COMPUTER - MAINFRAME 1.1%
International Business Machines Corporation 18,800 3,932,725
COMPUTER - PERIPHERAL EQUIPMENT 0.3%
EMC Communications Corporation (b) 9,000 980,437
COMPUTER - PERSONAL & WORKSTATION 1.8%
America Online, Inc. (b) 42,800 6,109,700
COMPUTER SOFTWARE 3.9%
Cisco Systems, Inc. (b) 50,175 5,723,086
Microsoft Corporation (b) 96,000 7,806,000
-----------
13,529,086
CONTAINER 0.0%
SF Holdings Group, Inc. Class C (Acquired 1/05/99;
Cost $3,750) (b) (d) 1,000 2,000
COSMETIC & PERSONAL CARE 0.2%
Estee Lauder Companies, Inc. Class A 6,700 670,837
DIVERSIFIED OPERATIONS 2.8%
Allied Signal, Inc. 18,200 1,069,250
16
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
STRONG ASSET ALLOCATION FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
E.I. Du Pont de Nemours & Company 11,000 $ 776,875
Textron, Inc. 24,500 2,257,062
Tyco International, Ltd. 65,966 5,359,738
-----------
9,462,925
ELECTRIC POWER 1.0%
Duke Energy Corporation 22,500 1,260,000
PECO Energy Company 26,300 1,247,606
Texas Utilities Electric Company 4,700 186,825
UNICOM Corporation 23,500 912,094
-----------
3,606,525
ELECTRICAL EQUIPMENT 2.6%
General Electric Company 84,000 8,862,000
ELECTRONICS - SEMICONDUCTOR/COMPONENT 1.7%
Altera Corporation (b) 7,500 541,875
Intel Corporation 62,200 3,805,862
Motorola, Inc. 12,000 961,500
Texas Instruments, Inc. 5,000 510,625
-----------
5,819,862
FINANCE - MISCELLANEOUS 0.7%
American Express Company 14,600 1,908,037
First Data Corporation 15,000 636,563
-----------
2,544,600
FOOD 0.3%
Unilever NV (b) 18,300 1,188,356
HEALTHCARE - DRUG/DIVERSIFIED 5.1%
American Home Products Corporation 40,100 2,446,100
Bristol-Myers Squibb Company 44,400 2,822,175
Johnson & Johnson 30,000 2,925,000
Merck & Company, Inc. 49,000 3,442,250
Pfizer, Inc. 27,200 3,129,700
Schering-Plough Corporation 29,600 1,430,050
Warner-Lambert Company 17,700 1,202,494
-----------
17,397,769
HOUSING RELATED 0.6%
Masco Corporation 71,000 2,085,625
INSURANCE - DIVERSIFIED 0.6%
CIGNA Corporation 9,400 819,563
Marsh & McLennan Companies, Inc. 18,000 1,378,125
-----------
2,197,688
INSURANCE - PROPERTY & CASUALTY 1.5%
The Allstate Corporation 34,600 1,258,575
American International Group, Inc. 34,002 3,993,110
-----------
5,251,685
MACHINERY - MISCELLANEOUS 0.3%
Ingersoll-Rand Company 17,350 1,200,403
MEDIA - PUBLISHING 1.0%
Gannett Company, Inc. 16,200 1,147,163
McGraw-Hill, Inc. 41,800 2,309,450
-----------
3,456,613
MEDIA - RADIO/TV 3.4%
AT&T Corporation-Liberty Media Group Class A (b) 28,350 1,810,856
CBS Corporation (b) 56,000 2,551,500
Clear Channel Communications, Inc. (b) 39,200 2,724,400
Cox Communications, Inc. Class A (b) 18,500 1,468,438
Time Warner, Inc. 42,000 2,940,000
-----------
11,495,194
MORTGAGE & RELATED SERVICE 1.7%
Federal Home Loan Mortgage Corporation 53,200 3,338,300
Federal National Mortgage Association 37,000 2,624,688
-----------
5,962,988
OFFICE AUTOMATION 1.3%
Pitney Bowes, Inc. 34,000 2,377,875
Xerox Corporation 32,900 1,932,875
-----------
4,310,750
OIL - INTERNATIONAL INTEGRATED 3.4%
BP Amoco PLC Sponsored ADR 16,500 1,867,594
Chevron Corporation 22,600 2,254,350
Exxon Corporation 39,900 3,314,194
Mobil Corporation 19,500 2,042,625
Royal Dutch Petroleum Company - New York
Registry Shares 35,000 2,054,062
-----------
11,532,825
PAPER & FOREST PRODUCTS 0.1%
International Paper Company 10,000 533,125
PERSONAL & COMMERCIAL LENDING 0.8%
Associates First Capital Corporation 48,904 2,167,058
Household International, Inc. 9,500 477,969
-----------
2,645,027
RETAIL - DRUG STORE 1.1%
CVS Corporation 45,000 2,143,125
Walgreen Company 63,500 1,706,563
-----------
3,849,688
RETAIL - FOOD CHAIN 1.3%
The Kroger Company (b) 44,700 2,427,769
Safeway, Inc. (b) 37,000 1,995,687
-----------
4,423,456
RETAIL - MAJOR CHAIN 2.3%
Dayton Hudson Corporation 40,500 2,726,156
Wal-Mart Stores, Inc. 109,000 5,014,000
-----------
7,740,156
RETAIL - RESTAURANT 0.3%
McDonald's Corporation 24,000 1,017,000
RETAIL - SPECIALTY 2.2%
Gap, Inc. 20,550 1,367,859
The Home Depot, Inc. 57,600 3,452,400
Lowe's Companies, Inc. 41,800 2,204,950
Tandy Corporation 8,100 586,744
-----------
7,611,953
SOAP & CLEANING PREPARATION 1.4%
Clorox Company 19,400 2,238,275
The Procter & Gamble Company 26,700 2,504,794
-----------
4,743,069
TELECOMMUNICATION EQUIPMENT 1.1%
Lucent Technologies, Inc. 61,600 3,703,700
TELECOMMUNICATION SERVICE 5.3%
AT&T Corporation 81,750 4,128,375
Bell Atlantic Corporation 37,600 2,166,700
MCI WorldCom, Inc. (b) 86,887 7,141,025
MediaOne Group, Inc. (b) 24,800 2,022,750
Sprint Corporation 26,000 2,666,625
-----------
18,125,475
TELEPHONE 1.4%
Ameritech Corporation 11,200 766,500
BellSouth Corporation 28,000 1,253,000
SBC Communications, Inc. 51,800 2,900,800
-----------
4,920,300
- --------------------------------------------------------------------------------
Total Common Stocks (Cost $130,087,156) 213,197,989
- --------------------------------------------------------------------------------
Warrants 0.3%
Aladdin Gaming Holdings LLC Warrants,
Expire 3/01/10 40,000 400
American Telecasting, Inc. Warrants, Expire 8/10/00 350 0
Concentric Network Warrants, Expire 12/15/07
(Acquired 12/15/97; Cost $6,980) (d) 2,000 61,600
e.spire Communications, Inc. Warrants, Expire 11/01/05 1,750 22,750
Mediq, Inc. Warrants, Expire 6/01/09 3,750 37
17
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) APRIL 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
STRONG ASSET ALLOCATION FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
News Corporation Exchange Trust Warrants,
Expire 11/12/16 50,000 $ 837,500
- --------------------------------------------------------------------------------
Total Warrants (Cost $1,954,567) 922,287
- --------------------------------------------------------------------------------
Preferred Stocks 1.1%
Nextlink Communications, Inc. 14.00%
Senior Exchangeable 37,073 2,038,996
R&B Falcon Corporation Units, 13.875%, Due 5/01/09
(Acquired 4/29/99; Cost $1,593,750) (d) 1,500 1,571,250
- --------------------------------------------------------------------------------
Total Preferred Stocks (Cost $3,314,518) 3,610,246
- --------------------------------------------------------------------------------
Corporate Bonds 26.8%
AKI, Inc. Senior Notes, 10.50%, Due 7/01/08 $ 800,000 788,000
APCOA/Standard Parking, Inc. Senior
Subordinated Notes, 9.25%, Due 3/15/08 2,250,000 2,129,062
Adelphia Communications Corporation Senior
Notes, 7.50%, Due 1/15/04 (Acquired 1/06/99;
Cost $2,000,000) (d) 2,000,000 1,995,000
Aladdin Gaming Holdings LLC/Aladdin Capital
Corporation Senior Discount Notes, Zero %,
Due 3/01/10 (Rate Reset Effective 3/01/03) 4,000,000 1,545,000
Allegiance Telecom, Inc. Senior Discount Notes,
Zero %, Due 2/15/08 (Rate Reset Effective 2/15/03 1,000,000 678,750
Atlas Air, Inc. Senior Notes, 10.75%, Due 8/01/05 2,000,000 2,115,000
BF Saul Real Estate Investment Trust Senior
Secured Notes, 9.75%, Due 4/01/08 3,000,000 2,925,000
Bay View Capital Corporation Subordinated Notes,
9.125%, Due 8/15/07 1,500,000 1,430,625
Building One Services Corporation Senior
Subordinated Notes, 10.50%, Due 5/01/09
(Acquired 4/23/99; Cost $1,466,190) (d) 1,500,000 1,470,000
Capstar Radio Broadcasting Partners, Inc. Senior
Subordinated Notes, 9.25%, Due 7/01/07 2,000,000 2,120,000
Cendant Corporation Notes, 7.75%, Due 12/01/03 2,000,000 2,064,632
Charter Communication Holdings LLC/Charter
Communication Holdings Capital Corporation
Senior Notes, 8.25%, Due 4/01/07
(Acquired 3/12/99; Cost $498,665) (d) 500,000 513,750
e.spire Communications, Inc. Senior Discount Notes,
Zero %, Due 7/01/08 (Rate Reset Effective 7/01/03) 2,000,000 970,000
e.spire Communications, Inc. Senior Notes, 13.75%,
Due 7/15/07 1,000,000 970,000
Fresenius Medical Care Capital Trust II Guaranteed
Preferred Securities, 7.875%, Due 2/01/08 2,000,000 1,970,000
GS Escrow Corporation Senior Notes,
7.00%, Due 8/01/03 5,000,000 5,023,825
Genesis Health Ventures, Inc. Senior Subordinated
Notes, 9.875%, Due 1/15/09 (Acquired 2/04/99;
Cost $1,860,000) (d) 2,000,000 1,800,000
Global Crossing Holding, Ltd. Senior Notes, 9.625%,
Due 5/15/08 2,000,000 2,240,000
Grove Worldwide LLC Senior Subordinated Notes,
9.25%, Due 5/01/08 420,000 363,300
Hermes Europe Railtel BV Senior Notes, 10.375%,
Due 1/15/09 2,000,000 2,145,000
Hyperion Telecommunications, Inc. Senior
Subordinated Notes, 12.00%, Due 11/01/07
(Acquired 2/25/99;Cost $1,000,000) (d) 1,000,000 1,055,000
Intermedia Communications, Inc. Senior Notes,
Series B, 13.50%, Due 6/01/05 241,000 274,138
Key Energy Services, Inc. Senior Subordinated Notes,
14.00%, Due 1/15/09 1,000,000 960,000
Lenfest Communications, Inc. Senior Subordinated
Notes, 8.25%, Due 2/15/08 2,150,000 2,225,250
MEDIQ, Inc. Senior Discount Debentures, Zero %,
Due 6/01/09 (Rate Reset Effective 6/01/03) 3,750,000 1,706,250
Majestic Star Casino LLC Senior Secured Notes,
12.75%, Due 5/15/03 1,000,000 1,120,000
Mobile Telecommunication Technologies
Corporation Senior Notes, 13.50%, Due 12/15/02 1,550,000 1,767,000
Mohegan Tribal Gaming Authority Senior Notes,
8.125%, Due 1/01/06 (Acquired 2/24/99;
Cost $2,000,000) (d) 2,000,000 2,057,500
Motors and Gears, Inc. Senior Notes, Series C,
10.75%,Due 11/15/06 1,800,000 1,863,000
NTL, Inc. Senior Notes, Series B, 10.00%,
Due 2/15/07 1,500,000 1,620,000
Niagara Mohawk Power Corporation Senior Notes,
Series C, 7.125%, Due 7/01/01 12,000,000 12,162,516
North Fork Capital Trust 1 Capital Trust
Pass-Thru Securities, 8.70%, Due 12/15/26 2,000,000 2,117,736
Pogo Producing Company Senior Subordinated
Notes, 10.375%, Due 2/15/09 2,000,000 2,100,000
Quorum Health Group, Inc. Senior Subordinated
Notes, 8.75%, Due 11/01/05 2,000,000 2,015,000
RCN Corporation Senior Discount Notes, Zero %,
Due 10/15/07 (Rate Reset Effective 10/15/02) 1,000,000 696,250
Rhythms Netconnections, Inc. Senior Notes, 12.75%,
Due 4/15/09 (Acquired 4/16/99; Cost $1,000,000) (d)1,000,000 1,002,500
Rogers Cablesystems, Ltd. Senior Secured Second
Priority Notes, Series B, 10.00%, Due 3/15/05 1,500,000 1,695,000
Rose Hills Company Senior Subordinated Notes,
9.50%, Due 11/15/04 175,000 150,063
SF Holdings Group, Inc. Senior Secured Discount
Notes, Zero %, Due 3/15/08 (Rate Reset
Effective 3/15/03) 500,000 157,500
SFX Entertainment, Inc. Senior Subordinated Notes,
9.125%, Due 12/01/08 (Acquired 11/19/98;
Cost $2,000,000) (d) 2,000,000 2,085,000
Sabreliner Corporation Senior Notes, 11.00%,
Due 6/15/08 (Acquired 6/19/98; Cost $2,500,000) (d)2,500,000 2,200,000
The Scotts Company Senior Subordinated Notes,
8.625%, Due 1/15/09 (Acquired 1/14/99;
Cost $2,028,624) (d) 2,000,000 2,082,500
Star Markets Company Senior Subordinated Notes,
13.00%, Due 11/01/04 500,000 548,750
Telecorp PCS, Inc. Senior Subordinated Discount
Notes, Zero %, Due 4/15/09 (Rate Reset Effective
4/15/04) (Acquired 4/20/99; Cost $854,700) (d) 1,500,000 855,000
Telemundo Holdings, Inc. Senior Discount Notes,
Zero %, Due 8/15/08 (Rate Reset Effective 8/15/03) 2,250,000 1,226,250
Transwestern Publishing Company LP/TWP
Capital Corporation II Senior Subordinated
Notes, Series D, 9.625%, Due 11/15/07 1,000,000 1,050,000
United International Holdings, Inc. Senior Secured
Discount Notes, Series B, Zero %, Due 2/15/08
(Rate Reset Effective 2/15/03) 1,000,000 690,000
Universal Compression, Inc. Senior Discount
Notes, Zero %, Due 2/15/08 (Rate
Reset Effective 2/15/03) 675,000 442,125
US Air 1993-A Pass-Thru Trust Certificates,
Series 1993-A2, 9.625%, Due 9/01/03 1,675,000 1,757,574
US Air, Inc. Senior Notes, 9.625%, Due 2/01/01 540,000 554,494
Vintage Petroleum, Inc. Senior Subordinated Notes,
9.75%, Due 6/30/09 (Acquired 1/20/99;
Cost $1,500,000) (d) 1,500,000 1,582,500
Winstar Communications, Inc. Senior Discount
Notes, Zero %, Due 10/15/05 (Rate
Reset Effective 10/15/00) 960,000 830,400
Winstar Communications, Inc. Senior Subordinated
Deferred Interest Notes, Zero %, Due 3/01/07
(Rate Reset Effective 9/01/02) 1,000,000 1,075,000
World Color Press, Inc. Senior Subordinated
Notes, 7.75%, Due 2/15/09 (Acquired 2/17/99;
Cost $1,966,020) (d) 2,000,000 1,970,000
18
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
STRONG ASSET ALLOCATION FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Worldwide Fiber, Inc. Senior Yankee Notes, 12.50%,
Due 12/15/05 (Acquired 2/17/99;
Cost $1,047,500) (d) $1,000,000 $ 1,077,500
- --------------------------------------------------------------------------------
Total Corporate Bonds (Cost $90,876,445) 92,028,740
- --------------------------------------------------------------------------------
Non-Agency Mortgage & Asset-Backed
Securities 0.1%
Chase Mortgage Finance Corporation Mortgage
Pass-Thru Certificates, Series 1990-G,
Class A-Z1, 9.50%, Due 12/25/21 330,869 340,382
First Boston Mortgage Securities Corporation
Mortgage Pass-Thru Certificates, Series 1993-2,
Class A-3, 7.50%, Due 3/25/33 947 957
Ryland Mortgage Securities Corporation III
Variable Rate Collateralized Mortgage Bonds,
Series 1992-C, Class 3-A, 11.6352%, Due 11/25/30 107,069 106,752
- --------------------------------------------------------------------------------
Total Non-Agency Mortgage & Asset-Backed
Securities (Cost $438,897) 448,091
- --------------------------------------------------------------------------------
United States Government & Agency Issues 1.9%
FHLMC Adjustable Rate Mortgage Participation
Certificates, 8.165%, Due 8/01/25 1,553,819 1,592,337
FHLMC Guaranteed Pass-Thru Certificates:
9.50%, Due 1/01/06 43,804 45,473
10.25%, Due 3/01/15 81,070 87,926
10.50%, Due 1/01/16 15,581 17,026
FNMA Guaranteed Real Estate Mortgage Investment
Conduit Pass-Thru Certificates, 11.00%,
Due 10/01/00 thru 11/01/00 44,397 45,893
FNMA Guaranteed Real Estate Mortgage Investment
Conduit Variable Rate Pass-Thru Certificates,
Series G92-61, Class FJ, 5.662%, Due 10/25/22 537,901 537,659
GNMA Guaranteed Pass-Thru Certificates, 7.50%,
Due 12/15/07 1,352,076 1,401,629
United States Treasury Bonds, 5.50%, Due 8/15/28 1,500,000 1,426,875
United States Treasury Notes, 4.75%, Due 2/15/04 1,450,000 1,421,454
- --------------------------------------------------------------------------------
Total United States Government & Agency Issues
(Cost $6,674,796) 6,576,272
- --------------------------------------------------------------------------------
Options 0.1%
Merrill Lynch Swaption (The option to receive a
fixed interest rate of 7.75%; exercisable at a strike
price of $100 beginning 4/09/04 and expiring
4/09/25.) 3,250,000 340,600
- --------------------------------------------------------------------------------
Total Options (Cost $150,486) 340,600
- --------------------------------------------------------------------------------
Short-Term Investments (a) 7.1%
COMMERCIAL PAPER 1.7%
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 4.51% 815,100 815,100
Pitney Bowes Credit Corporation, 4.51% 2,615,600 2,615,600
Warner Lambert Company, 4.50% 942,400 942,400
Wisconsin Electric Power Company, 4.50% 1,344,000 1,344,000
-----------
5,717,100
REPURCHASE AGREEMENTS 5.4%
Goldman Sachs & Company, Inc. (Dated 4/30/99),
4.80%, Due 5/03/99 (Repurchase proceeds
$18,607,440); Collateralized by United States
Treasury Bonds,(e) 18,600,000 18,600,000
UNITED STATES GOVERNMENT & AGENCY ISSUES 0.0%
United States Treasury Bills, Due 7/08/99
thru 7/22/99 (c) 25,000 24,782
- --------------------------------------------------------------------------------
Total Short-Term Investments (Cost $24,341,892) 24,341,882
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments in Securities (Cost $257,838,757) 99.5% 341,466,107
Other Assets and Liabilities, Net 0.5% 1,629,525
- --------------------------------------------------------------------------------
Net Assets 100.0% $343,095,632
================================================================================
FUTURES
- --------------------------------------------------------------------------------
Underlying Unrealized
Expiration Face Amount Appreciation
Date at Value (Depreciation)
- --------------------------------------------------------------------------------
Purchased:
20 Two-Year U.S. Treasury Notes 6/99 $4,191,250 ($ 9,525)
Sold:
20 Ten-Year U.S. Treasury Notes 6/99 2,293,750 29,225
================================================================================
STRONG BLUE CHIP 100 FUND
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Common Stocks 98.5%
AEROSPACE & DEFENSE 0.5%
The Boeing Company 26,600 $ 1,080,625
United Technologies Corporation 6,400 927,200
-----------
2,007,825
AUTOMOBILE 0.9%
Ford Motor Company 34,300 2,193,056
General Motors Corporation 18,500 1,645,344
-----------
3,838,400
BANK - MONEY CENTER 8.9%
Bank of America Corporation 157,918 11,370,096
The Chase Manhattan Corporation 179,600 14,861,900
Citigroup, Inc. 162,200 12,205,550
-----------
38,437,546
BANK - SUPER REGIONAL 3.0%
The Bank of New York Company, Inc. 171,000 6,840,000
Bank One Corporation 33,540 1,978,860
First Union Corporation 28,200 1,561,575
US Bancorp 20,500 759,781
Wells Fargo Company 46,700 2,016,856
-----------
13,157,072
BEVERAGE - ALCOHOLIC 0.2%
Anheuser-Busch Companies, Inc. 13,600 994,500
BEVERAGE - SOFT DRINK 1.4%
The Coca-Cola Company 69,900 4,753,200
PepsiCo, Inc. 41,700 1,540,294
-----------
6,293,494
BROKERAGE & INVESTMENT MANAGEMENT 3.3%
The Charles Schwab Corporation 11,400 1,251,150
Merrill Lynch & Company, Inc. 10,000 839,375
Morgan Stanley, Dean Witter & Company 121,900 12,090,956
-----------
14,181,481
COMPUTER - MAINFRAME 3.9%
Compaq Computer Corporation 48,000 1,071,000
Dell Computer Corporation (b) 72,600 2,990,213
Hewlett-Packard Company 28,800 2,271,600
International Business Machines Corporation 44,300 9,267,006
Sun Microsystems, Inc. (b) 21,800 1,303,912
-----------
16,903,731
COMPUTER - PERIPHERAL EQUIPMENT 3.6%
EMC Communications Corporation (b) 143,000 15,578,063
COMPUTER - PERSONAL & WORKSTATION 6.5%
Amazon.com, Inc. (b) 4,600 791,488
America Online, Inc. (b) 117,500 16,773,125
Yahoo, Inc. (b) 60,700 10,603,531
-----------
28,168,144
COMPUTER SERVICE 0.2%
Automatic Data Processing, Inc. 17,400 774,300
19
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) APRIL 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
STRONG BLUE CHIP 100 FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE 5.6%
Cisco Systems, Inc. (b) 44,700 $ 5,098,594
Microsoft Corporation (b) 222,400 18,083,900
Oracle Systems Corporation (b) 40,950 1,108,209
-----------
24,290,703
COSMETIC & PERSONAL CARE 0.4%
The Gillette Company 31,600 1,649,125
DIVERSIFIED OPERATIONS 3.4%
Allied Signal, Inc. 15,800 928,250
E.I. Du Pont de Nemours & Company 32,000 2,260,000
Minnesota Mining & Manufacturing Company 11,400 1,014,600
Monsanto Company 17,800 805,450
Tyco International, Ltd. 121,300 9,855,625
-----------
14,863,925
ELECTRICAL EQUIPMENT 3.7%
Emerson Electric Company 12,400 799,800
General Electric Company 143,425 15,131,338
-----------
15,931,138
ELECTRONICS - SEMICONDUCTOR/COMPONENT 4.3%
Intel Corporation 94,800 5,800,575
Motorola, Inc. 17,000 1,362,125
Texas Instruments, Inc. 111,900 11,427,787
-----------
18,590,487
FINANCE - MISCELLANEOUS 0.4%
American Express Company 12,800 1,672,800
HEALTHCARE - BIOMEDICAL/GENETIC 0.2%
Amgen, Inc. (b) 14,400 884,700
HEALTHCARE - DRUG/DIVERSIFIED 8.6%
Abbott Laboratories 43,000 2,082,812
American Home Products Corporation 37,500 2,287,500
Bristol-Myers Squibb Company 56,300 3,578,569
Johnson & Johnson 38,200 3,724,500
Eli Lilly & Company 31,200 2,297,100
Merck & Company, Inc. 67,800 4,762,950
Pfizer, Inc. 77,790 8,950,712
Pharmacia & Upjohn, Inc. 14,400 806,400
Schering-Plough Corporation 152,400 7,362,825
Warner-Lambert Company 23,100 1,569,356
-----------
37,422,724
HEALTHCARE - INSTRUMENTATION 0.3%
Medtronic, Inc. 16,600 1,194,163
INSURANCE - PROPERTY & CASUALTY 3.5%
The Allstate Corporation 23,200 843,900
American International Group, Inc. 122,352 14,368,713
-----------
15,212,613
LEISURE SERVICE 0.6%
Carnival Corporation 17,300 713,625
The Walt Disney Company 58,200 1,847,850
-----------
2,561,475
MEDIA - RADIO/TV 6.6%
AT&T Corporation-Liberty Media Group Class A (b) 14,800 945,350
CBS Corporation (b) 19,900 906,694
Comcast Corporation Class A 141,200 9,275,075
Time Warner, Inc. 236,700 16,569,000
Viacom International, Inc. (b) 19,800 809,325
-----------
28,505,444
MORTGAGE & RELATED SERVICE 0.8%
Federal Home Loan Mortgage Corporation 19,200 1,204,800
Federal National Mortgage Association 29,400 2,085,562
-----------
3,290,362
OFFICE AUTOMATION 0.2%
Xerox Corporation 18,500 1,086,875
OIL - INTERNATIONAL INTEGRATED 2.5%
Chevron Corporation 18,600 1,855,350
Exxon Corporation 69,100 5,739,619
Mobil Corporation 22,100 2,314,975
Texaco, Inc. 15,100 947,525
-----------
10,857,469
OIL WELL EQUIPMENT & SERVICE 0.2%
Schlumberger, Ltd. 15,400 983,675
PAPER & FOREST PRODUCTS 0.2%
Kimberly-Clark Corporation 15,400 944,213
PERSONAL & COMMERCIAL LENDING 0.2%
Associates First Capital Corporation 20,620 913,724
POLLUTION CONTROL 0.2%
Waste Management, Inc. 16,900 954,850
RETAIL - DRUG STORE 0.2%
Walgreen Company 28,400 763,250
RETAIL - FOOD CHAIN 0.2%
Safeway, Inc. (b) 13,800 744,337
RETAIL - MAJOR CHAIN 3.9%
Dayton Hudson Corporation 12,600 848,138
Wal-Mart Stores, Inc. 344,640 15,853,440
-----------
16,701,578
RETAIL - RESTAURANT 0.4%
McDonald's Corporation 38,400 1,627,200
RETAIL - SPECIALTY 6.7%
Gap, Inc. 136,750 9,102,422
The Home Depot, Inc. 209,010 12,527,537
Lowe's Companies, Inc. 142,700 7,527,425
-----------
29,157,384
SOAP & CLEANING PREPARATION 1.0%
Colgate Palmolive Company 8,400 860,475
The Procter & Gamble Company 37,800 3,546,112
-----------
4,406,587
TELECOMMUNICATION EQUIPMENT 1.3%
Lucent Technologies, Inc. 75,100 4,515,388
Nortel Networks Corporation 18,800 1,281,925
-----------
5,797,313
TELECOMMUNICATION SERVICE 7.5%
AT&T Corporation 89,428 4,516,114
AirTouch Communications, Inc. (b) 16,200 1,512,675
Bell Atlantic Corporation 44,100 2,541,262
MCI WorldCom, Inc. (b) 196,470 16,147,378
MediaOne Group, Inc. (b) 69,100 5,635,969
Qwest Communications International, Inc. (b) 10,000 854,375
Sprint Corporation 12,600 1,292,288
-----------
32,500,061
TELEPHONE 2.4%
Ameritech Corporation 31,200 2,135,250
BellSouth Corporation 55,400 2,479,150
GTE Corporation 27,400 1,834,087
SBC Communications, Inc. 55,600 3,113,600
US WEST, Inc. 14,400 753,300
-----------
10,315,387
TOBACCO 0.6%
Philip Morris Companies, Inc. 69,200 2,426,325
- --------------------------------------------------------------------------------
Total Common Stocks (Cost $378,170,212) 426,584,443
- --------------------------------------------------------------------------------
20
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
STRONG BLUE CHIP 100 FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Short-Term Investments (a) 1.5%
COMMERCIAL PAPER
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 4.51% $1,639,700 $ 1,639,700
Sara Lee Corporation, 4.50% 285,800 285,800
Wisconsin Electric Power Company, 4.50% 4,331,600 4,331,600
- --------------------------------------------------------------------------------
Total Short-Term Investments (Cost $6,257,100) 6,257,100
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments in Securities (Cost $384,427,312) 100.0% 432,841,543
Other Assets and Liabilities, Net 0.0% 36,676
- --------------------------------------------------------------------------------
Net Assets 100.0% $432,878,219
================================================================================
================================================================================
STRONG EQUITY INCOME FUND
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Common Stocks 97.8%
AEROSPACE & DEFENSE 1.0%
United Technologies Corporation 13,000 $ 1,883,375
AIRLINE 0.3%
FDX Corporation (b) 4,200 472,763
AUTOMOBILE 1.1%
Ford Motor Company 34,000 2,173,875
BANK - MONEY CENTER 5.4%
Bank of America Corporation 41,100 2,959,200
The Chase Manhattan Corporation 31,300 2,590,075
Citigroup, Inc. 63,099 4,748,200
-----------
10,297,475
BANK - SUPER REGIONAL 5.0%
The Bank of New York Company, Inc. 34,500 1,380,000
Bank One Corporation 22,700 1,339,300
Comerica, Inc. 24,300 1,581,019
First Union Corporation 13,900 769,712
Mellon Bank Corporation 34,500 2,563,781
Wells Fargo Company 45,300 1,956,394
-----------
9,590,206
BEVERAGE - ALCOHOLIC 0.9%
Anheuser-Busch Companies, Inc. 24,000 1,755,000
BEVERAGE - SOFT DRINK 1.1%
The Coca-Cola Company 18,200 1,237,600
PepsiCo, Inc. 25,000 923,438
-----------
2,161,038
BROKERAGE & INVESTMENT MANAGEMENT 0.2%
Morgan Stanley, Dean Witter & Company 4,500 446,344
COMMERCIAL SERVICE 1.3%
The Interpublic Group of Companies, Inc. 30,900 2,396,681
COMPUTER - MAINFRAME 1.6%
International Business Machines Corporation 14,900 3,116,894
COMPUTER SOFTWARE 0.2%
Oracle Systems Corporation (b) 15,000 405,938
COSMETIC & PERSONAL CARE 0.3%
Estee Lauder Companies, Inc. Class A 5,700 570,713
DIVERSIFIED OPERATIONS 5.3%
Allied Signal, Inc. 23,000 1,351,250
E.I. Du Pont de Nemours & Company 21,200 1,497,250
Textron, Inc. 21,900 2,017,538
Tyco International, Ltd. 65,104 5,289,700
-----------
10,155,738
ELECTRIC POWER 2.1%
Duke Energy Corporation 22,500 1,260,000
PECO Energy Company 14,900 706,819
The Southern Company 15,500 419,469
Texas Utilities Electric Company 22,500 894,375
UNICOM Corporation 20,200 784,012
-----------
4,064,675
ELECTRICAL EQUIPMENT 4.4%
Emerson Electric Company 17,000 1,096,500
General Electric Company 68,000 7,174,000
-----------
8,270,500
ELECTRONICS - SEMICONDUCTOR/COMPONENT 0.7%
Intel Corporation 8,100 495,619
Motorola, Inc. 9,500 761,187
-----------
1,256,806
FINANCE - MISCELLANEOUS 1.1%
American Express Company 12,100 1,581,319
First Data Corporation 12,000 509,250
-----------
2,090,569
FOOD 0.7%
Bestfoods 16,000 803,000
Sara Lee Corporation 26,000 578,500
-----------
1,381,500
HEALTHCARE - DRUG/DIVERSIFIED 10.6%
American Home Products Corporation 34,200 2,086,200
Bristol-Myers Squibb Company 49,000 3,114,563
Johnson & Johnson 24,500 2,388,750
Eli Lilly & Company 14,000 1,030,750
Merck & Company, Inc. 51,600 3,624,900
Pfizer, Inc. 20,800 2,393,300
Pharmacia & Upjohn, Inc. 17,000 952,000
Schering-Plough Corporation 55,000 2,657,187
SmithKline Beecham PLC Sponsored ADR 14,000 919,625
Warner-Lambert Company 14,800 1,005,475
-----------
20,172,750
HEALTHCARE - MEDICAL SUPPLY 0.9%
Becton, Dickinson & Company 45,800 1,703,187
HOUSING RELATED 1.0%
Masco Corporation 62,200 1,827,125
INSURANCE - DIVERSIFIED 0.9%
CIGNA Corporation 6,900 601,594
Marsh & McLennan Companies, Inc. 14,850 1,136,953
-----------
1,738,547
INSURANCE - PROPERTY & CASUALTY 3.0%
The Allstate Corporation 29,400 1,069,425
American International Group, Inc. 39,037 4,584,408
-----------
5,653,833
LEISURE PRODUCT 0.6%
The Seagram Company, Ltd. 19,000 1,090,125
LEISURE SERVICE 0.4%
The Walt Disney Company 23,900 758,825
MACHINERY - MISCELLANEOUS 0.9%
Ingersoll-Rand Company 25,200 1,743,525
MEDIA - PUBLISHING 1.7%
Gannett Company, Inc. 17,000 1,203,812
McGraw-Hill, Inc. 36,600 2,022,150
-----------
3,225,962
21
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) APRIL 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
STRONG EQUITY INCOME FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
MEDIA - RADIO/TV 3.9%
AT&T Corporation-Liberty Media Group Class A (b) 22,800 $ 1,456,350
CBS Corporation (b) 41,500 1,890,844
Time Warner, Inc. 58,000 4,060,000
-----------
7,407,194
METAL PRODUCTS & FABRICATION 0.5%
Illinois Tool Works, Inc. 12,600 970,200
METALS & MINING 0.2%
Alcoa, Inc. 6,800 423,300
MORTGAGE & RELATED SERVICE 2.6%
Federal Home Loan Mortgage Corporation 46,000 2,886,500
Federal National Mortgage Association 30,000 2,128,125
-----------
5,014,625
OFFICE AUTOMATION 2.2%
Pitney Bowes, Inc. 38,000 2,657,625
Xerox Corporation 27,500 1,615,625
-----------
4,273,250
OIL - INTERNATIONAL INTEGRATED 6.6%
BP Amoco PLC Sponsored ADR 2,600 294,287
Chevron Corporation 25,500 2,543,625
Exxon Corporation 49,000 4,070,063
Mobil Corporation 18,100 1,895,975
Royal Dutch Petroleum Company - New York
Registry Shares 50,000 2,934,375
Texaco, Inc. 12,100 759,275
-----------
12,497,600
OIL - NORTH AMERICAN EXPLORATION & PRODUCTION 0.3%
Burlington Resources, Inc. 13,000 598,812
OIL - NORTH AMERICAN INTEGRATED 0.2%
USX-Marathon Group 13,500 421,875
OIL WELL EQUIPMENT & SERVICE 0.7%
Halliburton Company 30,500 1,300,062
PAPER & FOREST PRODUCTS 1.3%
International Paper Company 8,500 453,156
The Mead Corporation 26,800 1,120,575
Temple-Inland, Inc. 12,000 828,000
-----------
2,401,731
PERSONAL & COMMERCIAL LENDING 1.6%
Associates First Capital Corporation 47,522 2,105,819
Household International, Inc. 19,400 976,062
-----------
3,081,881
POLLUTION CONTROL 0.3%
Republic Services, Inc. Class A (b) 30,000 616,875
REAL ESTATE 0.2%
Duke Realty Investments, Inc. 13,400 314,900
RETAIL - DRUG STORE 1.4%
Rite Aid Corporation 27,100 631,769
Walgreen Company 72,000 1,935,000
-----------
2,566,769
RETAIL - FOOD CHAIN 1.1%
The Kroger Company (b) 38,300 2,080,169
RETAIL - MAJOR CHAIN 3.7%
Dayton Hudson Corporation 34,500 2,322,281
Wal-Mart Stores, Inc. 102,400 4,710,400
-----------
7,032,681
RETAIL - RESTAURANT 0.6%
McDonald's Corporation 27,000 1,144,125
RETAIL - SPECIALTY 3.9%
Gap, Inc. 17,550 1,168,172
The Home Depot, Inc. 51,100 3,062,806
Lowe's Companies, Inc. 45,300 2,389,575
Tandy Corporation 10,500 760,594
-----------
7,381,147
SOAP & CLEANING PREPARATION 2.7%
Clorox Company 21,100 2,434,412
The Procter & Gamble Company 28,400 2,664,275
-----------
5,098,687
STEEL 0.2%
USX-US Steel Group 10,300 311,575
TELECOMMUNICATION SERVICE 8.3%
AT&T Corporation 72,450 3,658,725
AirTouch Communications, Inc. (b) 10,800 1,008,450
Bell Atlantic Corporation 36,500 2,103,313
Corning, Inc. 14,266 816,728
MCI WorldCom, Inc. (b) 64,048 5,263,945
Sprint Corporation 28,900 2,964,056
-----------
15,815,217
TELEPHONE 2.6%
Ameritech Corporation 10,600 725,437
BellSouth Corporation 47,000 2,103,250
SBC Communications, Inc. 38,500 2,156,000
-----------
4,984,687
- --------------------------------------------------------------------------------
Total Common Stocks (Cost $125,819,700) 186,141,331
- --------------------------------------------------------------------------------
Convertible Preferred Stocks 1.9%
Houston Industries, Inc. 7.00% Automatic Common
Exchange Securities 30,000 3,540,000
- --------------------------------------------------------------------------------
Total Convertible Preferred Stocks (Cost $1,378,125) 3,540,000
- --------------------------------------------------------------------------------
Convertible Bonds 0.2%
Loews Corporation Exchangeable Subordinated Notes,
3.125%, Due 9/15/07 (Exchangeable into Diamond
Offshore Drilling, Inc. Common Stock) $500,000 421,250
- --------------------------------------------------------------------------------
Total Convertible Bonds (Cost $500,000) 421,250
- --------------------------------------------------------------------------------
Short-Term Investments (a) 0.5%
COMMERCIAL PAPER
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 4.51% 174,400 174,400
Pitney Bowes Credit Corporation, 4.51% 45,200 45,200
Sara Lee Corporation, 4.50% 160,000 160,000
Warner Lambert Company, 4.50% 388,700 388,700
Wisconsin Electric Power Company, 4.50% 118,700 118,700
- --------------------------------------------------------------------------------
Total Short-Term Investments (Cost $887,000) 887,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments in Securities (Cost $128,584,825) 100.4% 190,989,581
Other Assets and Liabilities, Net (0.4%) (754,050)
- --------------------------------------------------------------------------------
Net Assets 100.0% $190,235,531
================================================================================
22
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
STRONG GROWTH AND INCOME FUND
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Common Stocks 99.9%
AEROSPACE & DEFENSE 1.1%
United Technologies Corporation 53,000 $ 7,678,375
AIRLINE 0.2%
FDX Corporation (b) 12,500 1,407,031
AUTOMOBILE 0.8%
Ford Motor Company 87,000 5,562,562
BANK - MONEY CENTER 4.9%
Bank of America Corporation 84,700 6,098,400
The Chase Manhattan Corporation 110,000 9,102,500
Citigroup, Inc. 232,000 17,458,000
J.P. Morgan & Company, Inc. 8,000 1,078,000
-----------
33,736,900
BANK - SUPER REGIONAL 3.1%
The Bank of New York Company, Inc. 74,000 2,960,000
Bank One Corporation 62,500 3,687,500
Comerica, Inc. 39,450 2,566,715
First Union Corporation 27,000 1,495,125
Mellon Bank Corporation 83,000 6,167,938
Wells Fargo Company 95,500 4,124,406
-----------
21,001,684
BEVERAGE - ALCOHOLIC 1.0%
Anheuser-Busch Companies, Inc. 90,000 6,581,250
BEVERAGE - SOFT DRINK 1.7%
The Coca-Cola Company 124,000 8,432,000
PepsiCo, Inc. 84,500 3,121,219
-----------
11,553,219
BROKERAGE & INVESTMENT MANAGEMENT 0.8%
Morgan Stanley, Dean Witter & Company 57,000 5,653,687
CHEMICAL - SPECIALTY 0.5%
Praxair, Inc. 62,000 3,208,500
COMMERCIAL SERVICE 0.4%
The Interpublic Group of Companies, Inc. 36,950 2,865,934
COMPUTER - MAINFRAME 2.9%
Dell Computer Corporation (b) 48,000 1,977,000
International Business Machines Corporation 52,300 10,940,506
Sun Microsystems, Inc. (b) 115,000 6,878,438
-----------
19,795,944
COMPUTER - PERIPHERAL EQUIPMENT 0.5%
EMC Communications Corporation (b) 33,800 3,682,087
COMPUTER - PERSONAL & WORKSTATION 2.4%
America Online, Inc. (b) 114,400 16,330,600
COMPUTER SOFTWARE 6.4%
AppliedTheory Corporation (b) 3,800 77,900
BMC Software, Inc. (b) 33,000 1,421,062
Cisco Systems, Inc. (b) 156,000 17,793,750
Marimba, Inc. (b) 3,200 194,400
Microsoft Corporation (b) 299,000 24,312,438
-----------
43,799,550
COSMETIC & PERSONAL CARE 0.2%
Estee Lauder Companies, Inc. Class A 13,200 1,321,650
DIVERSIFIED OPERATIONS 7.0%
Allied Signal, Inc. 106,500 6,256,875
E.I. Du Pont de Nemours & Company 77,000 5,438,125
Textron, Inc. 65,500 6,034,188
Tyco International, Ltd. 369,714 30,039,262
-----------
47,768,450
ELECTRIC POWER 0.9%
PECO Energy Company 122,000 5,787,375
ELECTRICAL EQUIPMENT 3.2%
General Electric Company 209,500 22,102,250
ELECTRONICS - SEMICONDUCTOR/COMPONENT 4.7%
Altera Corporation (b) 77,000 5,563,250
Applied Materials, Inc. (b) 78,000 4,182,750
Intel Corporation 179,000 10,952,562
Motorola, Inc. 58,000 4,647,250
Solectron Corporation (b) 40,000 1,940,000
Texas Instruments, Inc. 44,500 4,544,563
-----------
31,830,375
FINANCE - MISCELLANEOUS 2.7%
American Express Company 66,000 8,625,375
First Data Corporation 96,000 4,074,000
Providian Financial Corporation 42,500 5,485,156
-----------
18,184,531
FOOD 0.3%
Unilever NV (b) 31,300 2,032,544
HEALTHCARE - DRUG/DIVERSIFIED 8.5%
American Home Products Corporation 110,000 6,710,000
Bristol-Myers Squibb Company 125,000 7,945,312
Johnson & Johnson 87,000 8,482,500
Eli Lilly & Company 35,000 2,576,875
Merck & Company, Inc. 119,500 8,394,875
Pfizer, Inc. 52,100 5,994,756
Pharmacia & Upjohn, Inc. 88,000 4,928,000
Schering-Plough Corporation 144,000 6,957,000
SmithKline Beecham PLC Sponsored ADR 36,000 2,364,750
Warner-Lambert Company 58,200 3,953,963
-----------
58,308,031
HEALTHCARE - MEDICAL SUPPLY 0.4%
Becton, Dickinson & Company 75,000 2,789,062
HOUSING RELATED 0.4%
Masco Corporation 96,000 2,820,000
INSURANCE - DIVERSIFIED 0.8%
CIGNA Corporation 35,400 3,086,438
Marsh & McLennan Companies, Inc. 33,000 2,526,562
-----------
5,613,000
INSURANCE - PROPERTY & CASUALTY 1.5%
The Allstate Corporation 32,000 1,164,000
American International Group, Inc. 78,551 9,224,833
-----------
10,388,833
LEISURE PRODUCT 0.8%
The Seagram Company, Ltd. 100,000 5,737,500
LEISURE SERVICE 0.3%
The Walt Disney Company 58,000 1,841,500
MACHINERY - MISCELLANEOUS 0.5%
Ingersoll-Rand Company 53,000 3,666,937
MACHINERY - TRANSPORTATION EQUIPMENT & PARTS 0.3%
Eaton Corporation 23,400 2,145,488
MEDIA - PUBLISHING 1.0%
Gannett Company, Inc. 38,000 2,690,875
McGraw-Hill, Inc. 74,600 4,121,650
-----------
6,812,525
MEDIA - RADIO/TV 4.9%
AT&T Corporation-Liberty Media Group Class A (b) 38,400 2,452,800
CBS Corporation (b) 158,000 7,198,875
23
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) APRIL 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
STRONG GROWTH AND INCOME FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Chancellor Media Corporation (b) 45,000 $ 2,469,375
Clear Channel Communications, Inc. (b) 110,000 7,645,000
Cox Communications, Inc. Class A (b) 37,500 2,976,563
Time Warner, Inc. 155,500 10,885,000
-----------
33,627,613
METAL PRODUCTS & FABRICATION 0.3%
Illinois Tool Works, Inc. 23,000 1,771,000
METALS & MINING 0.4%
Alcoa, Inc. 43,500 2,707,875
MORTGAGE & RELATED SERVICE 1.9%
Federal Home Loan Mortgage Corporation 108,000 6,777,000
Federal National Mortgage Association 91,000 6,455,313
-----------
13,232,313
OFFICE AUTOMATION 1.3%
Pitney Bowes, Inc. 83,500 5,839,781
Xerox Corporation 57,000 3,348,750
-----------
9,188,531
OIL - INTERNATIONAL INTEGRATED 5.4%
BP Amoco PLC Sponsored ADR 49,500 5,602,781
Chevron Corporation 61,500 6,134,625
Exxon Corporation 107,000 8,887,688
Mobil Corporation 62,000 6,494,500
Royal Dutch Petroleum Company - New York
Registry Shares 169,000 9,918,187
-----------
37,037,781
OIL - NORTH AMERICAN EXPLORATION & PRODUCTION 0.2%
Burlington Resources, Inc. 36,000 1,658,250
OIL WELL EQUIPMENT & SERVICE 1.2%
Halliburton Company 188,000 8,013,500
PAPER & FOREST PRODUCTS 1.4%
Georgia-Pacific Corporation 30,500 2,821,250
International Paper Company 123,500 6,584,094
-----------
9,405,344
PERSONAL & COMMERCIAL LENDING 1.0%
Associates First Capital Corporation 126,010 5,583,818
Household International, Inc. 27,500 1,383,594
-----------
6,967,412
RETAIL - DEPARTMENT STORE 0.1%
Kohl's Corporation (b) 10,000 664,375
RETAIL - DRUG STORE 1.0%
CVS Corporation 85,000 4,048,125
Walgreen Company 102,800 2,762,750
-----------
6,810,875
RETAIL - FOOD CHAIN 1.5%
Fred Meyer, Inc. (b) 48,000 2,598,000
The Kroger Company (b) 36,000 1,955,250
Safeway, Inc. (b) 105,000 5,663,438
-----------
10,216,688
RETAIL - MAJOR CHAIN 2.5%
Dayton Hudson Corporation 94,000 6,327,375
Wal-Mart Stores, Inc. 238,000 10,948,000
-----------
17,275,375
RETAIL - RESTAURANT 0.7%
McDonald's Corporation 113,500 4,809,563
RETAIL - SPECIALTY 3.6%
Best Buy Company, Inc. (b) 90,400 4,316,600
Gap, Inc. 30,000 1,996,875
The Home Depot, Inc. 106,500 6,383,344
Lowe's Companies, Inc. 125,000 6,593,750
Tandy Corporation 71,500 5,179,281
-----------
24,469,850
SOAP & CLEANING PREPARATION 1.8%
Clorox Company 40,000 4,615,000
Colgate Palmolive Company 17,500 1,792,656
The Procter & Gamble Company 65,500 6,144,719
-----------
12,552,375
TELECOMMUNICATION EQUIPMENT 2.3%
Lucent Technologies, Inc. 180,000 10,822,500
Nokia Corporation Sponsored ADR 38,500 2,856,219
Tellabs, Inc. (b) 18,000 1,972,125
-----------
15,650,844
TELECOMMUNICATION SERVICE 6.8%
AirTouch Communications, Inc. (b) 34,000 3,174,750
AT&T Corporation 237,000 11,968,500
Bell Atlantic Corporation 78,500 4,523,563
MCI WorldCom, Inc. (b) 198,253 16,293,918
MediaOne Group, Inc. (b) 49,000 3,996,562
Sprint Corporation 66,300 6,799,894
-----------
46,757,187
TELEPHONE 1.4%
Ameritech Corporation 18,200 1,245,563
BellSouth Corporation 63,000 2,819,250
SBC Communications, Inc. 92,000 5,152,000
-----------
9,216,813
- --------------------------------------------------------------------------------
Total Common Stocks (Cost $496,922,681) 684,040,938
- --------------------------------------------------------------------------------
Short-Term Investments (a) 0.5%
COMMERCIAL PAPER
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 4.51% $ 615,700 615,700
Pitney Bowes Credit Corporation, 4.51% 950,800 950,800
Sara Lee Corporation, 4.50% 1,090,500 1,090,500
Warner Lambert Company, 4.50% 397,800 397,800
Wisconsin Electric Power Company, 4.50% 567,600 567,600
- --------------------------------------------------------------------------------
Total Short-Term Investments (Cost $3,622,400) 3,622,400
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments in Securities (Cost $500,545,081) 100.4% 687,663,338
Other Assets and Liabilities, Net (0.4%) (3,112,351)
- --------------------------------------------------------------------------------
Net Assets 100.0% $684,550,987
================================================================================
================================================================================
STRONG LIMITED RESOURCES FUND
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Common Stocks 92.4%
CHEMICAL 1.9%
The Dow Chemical Company 500 $ 65,594
IMC Global, Inc. 2,500 62,500
----------
128,094
CHEMICAL - SPECIALTY 4.3%
Cabot Corporation 6,000 162,000
Praxair, Inc. 2,500 129,375
----------
291,375
DIVERSIFIED OPERATIONS 3.7%
E.I. Du Pont de Nemours & Company 3,500 247,187
ELECTRIC POWER 1.7%
Duke Energy Corporation 2,000 112,000
METALS & MINING 3.8%
Alcoa, Inc. 2,600 161,850
Phelps Dodge Corporation 1,500 94,875
----------
256,725
NATURAL GAS DISTRIBUTION 14.4%
Coastal Corporation 6,000 229,500
Consolidated Natural Gas Company 1,600 95,200
24
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
STRONG LIMITED RESOURCES FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
El Paso Energy Corporation 5,000 $ 183,750
Enron Corporation 2,500 188,125
KN Energy, Inc. 5,500 113,437
Questar Corporation 9,000 163,688
----------
973,700
OIL - INTERNATIONAL INTEGRATED 12.5%
Chevron Corporation 3,400 339,150
Mobil Corporation 2,300 240,925
YPF Sociedad Anonima ADR 6,400 268,800
----------
848,875
OIL - NORTH AMERICAN EXPLORATION & PRODUCTION 21.3%
Anadarko Petroleum Corporation 4,300 163,131
Apache Corporation 6,000 184,125
Burlington Resources, Inc. 3,000 138,187
Devon Energy Corporation 5,000 166,250
Enron Oil & Gas Company 9,000 171,000
Gulf Canada Resources, Ltd. ADR (b) 45,000 180,000
Ocean Energy, Inc. (b) 21,000 195,563
Union Pacific Resources Group, Inc. 8,000 112,000
Vastar Resources, Inc. 2,400 131,700
----------
1,441,956
OIL - NORTH AMERICAN INTEGRATED 7.9%
Amerada Hess Corporation 4,000 228,000
Transmontaigne, Inc. (b) 10,000 142,500
Unocal Corporation 4,000 166,250
----------
536,750
OIL WELL EQUIPMENT & SERVICE 13.5%
Cooper Cameron Corporation (b) 3,900 150,638
ENSCO International, Inc. 6,000 111,375
Halliburton Company 4,000 170,500
Nabors Industries, Inc. (b) 7,500 154,219
Schlumberger, Ltd. 2,300 146,912
Smith International, Inc. (b) 4,000 179,500
----------
913,144
PAPER & FOREST PRODUCTS 5.7%
Bowater, Inc. 1,000 53,625
Kimberly-Clark Corporation 1,500 91,969
Willamette Industries, Inc. 5,200 243,100
----------
388,694
STEEL 1.7%
AK Steel Holding Corporation 4,500 117,000
- --------------------------------------------------------------------------------
Total Common Stocks (Cost $5,738,070) 6,255,500
- --------------------------------------------------------------------------------
Short-Term Investments (a) 8.5%
COMMERCIAL PAPER
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 4.51% $258,500 258,500
Pitney Bowes Credit Corporation, 4.51% 93,800 93,800
Sara Lee Corporation, 4.50% 128,300 128,300
Warner Lambert Company, 4.50% 52,200 52,200
Wisconsin Electric Power Company, 4.50% 42,000 42,000
- --------------------------------------------------------------------------------
Total Short-Term Investments (Cost $574,800) 574,800
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments in Securities (Cost $6,312,870) 100.9% 6,830,300
Other Assets and Liabilities, Net (0.9%) (59,369)
- --------------------------------------------------------------------------------
Net Assets 100.0% $6,770,931
================================================================================
================================================================================
STRONG TOTAL RETURN FUND
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
Common Stocks 94.5%
AEROSPACE & DEFENSE 1.9%
Raytheon Company Class A 25,000 $ 1,729,687
United Technologies Corporation 145,000 21,006,875
-----------
22,736,562
AIRLINE 2.0%
Delta Air Lines, Inc. 135,000 8,564,062
FDX Corporation (b) 90,000 10,130,625
Southwest Airlines Company 140,000 4,558,750
-----------
23,253,437
AUTO & TRUCK PARTS 0.6%
The Goodyear Tire & Rubber Company 120,000 6,862,500
AUTOMOBILE 0.8%
Ford Motor Company 80,000 5,115,000
Honda Motor Co., Ltd. ADR 50,000 4,418,750
-----------
9,533,750
BANK - MONEY CENTER 5.8%
Bank of America Corporation 90,000 6,480,000
The Bank of Tokyo-Mitsubishi, Ltd. Sponsored ADR 245,000 3,583,125
The Chase Manhattan Corporation 185,000 15,308,750
Citigroup, Inc. 390,000 29,347,500
J.P. Morgan & Company, Inc. 100,000 13,475,000
-----------
68,194,375
BANK - SUPER REGIONAL 1.3%
Northern Trust Company 55,000 5,121,875
State Street Corporation 120,000 10,500,000
-----------
15,621,875
BEVERAGE - ALCOHOLIC 0.1%
Anheuser-Busch Companies, Inc. 15,000 1,096,875
BROKERAGE & INVESTMENT MANAGEMENT 3.5%
The Charles Schwab Corporation 117,800 12,928,550
Lehman Brothers Holdings, Inc. 90,000 5,000,625
Merrill Lynch & Company, Inc. 50,000 4,196,875
Morgan Stanley, Dean Witter & Company 190,000 18,845,625
-----------
40,971,675
CHEMICAL 1.3%
Rohm & Haas Company 340,000 15,236,250
CHEMICAL - SPECIALTY 1.7%
Praxair, Inc. 394,700 20,425,725
COMMERCIAL SERVICE 1.2%
The Dun & Bradstreet Corporation 50,000 1,837,500
The Hertz Corporation 145,000 8,654,687
Omnicom Group, Inc. 50,000 3,625,000
-----------
14,117,187
COMPUTER - MAINFRAME 0.5%
Dell Computer Corporation (b) 150,000 6,178,125
COMPUTER - PERIPHERAL EQUIPMENT 0.9%
EMC Communications Corporation (b) 100,000 10,893,750
COMPUTER - PERSONAL & WORKSTATION 2.9%
Amazon.com, Inc. (b) 10,000 1,720,625
America Online, Inc. (b) 175,000 24,981,250
At Home Corporation Series A (b) 20,000 2,878,750
E*Trade Group, Inc. (b) 22,600 2,610,300
Sun Microsystems, Inc. (b) 30,000 1,794,375
-----------
33,985,300
COMPUTER SOFTWARE 6.6%
Ascend Communications, Inc. (b) 115,000 11,111,875
Cisco Systems, Inc. (b) 410,000 46,765,625
Microsoft Corporation (b) 240,000 19,515,000
-----------
77,392,500
25
<PAGE>
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) APRIL 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
STRONG TOTAL RETURN FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
COSMETIC & PERSONAL CARE 0.4%
Estee Lauder Companies, Inc. Class A 50,000 $ 5,006,250
DIVERSIFIED OPERATIONS 4.1%
Allied Signal, Inc. 222,500 13,071,875
E.I. Du Pont de Nemours & Company 200,000 14,125,000
Textron, Inc. 25,000 2,303,125
Tyco International, Ltd. 230,000 18,687,500
-----------
48,187,500
ELECTRICAL EQUIPMENT 1.8%
General Electric Company 200,000 21,100,000
ELECTRONIC PRODUCTS - MISCELLANEOUS 0.4%
Rockwell International Corporation 100,000 5,162,500
ELECTRONICS - SEMICONDUCTOR/COMPONENT 2.8%
Applied Materials, Inc. (b) 20,000 1,072,500
Intel Corporation 60,000 3,671,250
Linear Technology Corporation 125,000 7,109,375
Maxim Integrated Products, Inc. (b) 70,000 3,920,000
Motorola, Inc. 180,000 14,422,500
Texas Instruments, Inc. 30,000 3,063,750
-----------
33,259,375
FINANCE - MISCELLANEOUS 4.4%
American Express Company 145,000 18,949,688
First Data Corporation 200,000 8,487,500
Providian Financial Corporation 190,000 24,521,875
-----------
51,959,063
HEALTHCARE - BIOMEDICAL/GENETIC 0.5%
Amgen, Inc. (b) 100,000 6,143,750
HEALTHCARE - DRUG/DIVERSIFIED 1.9%
Abbott Laboratories 50,000 2,421,875
American Home Products Corporation 40,000 2,440,000
Johnson & Johnson 90,000 8,775,000
Pfizer, Inc. 50,000 5,753,125
Pharmacia & Upjohn, Inc. 12,500 700,000
Schering-Plough Corporation 40,000 1,932,500
-----------
22,022,500
HEALTHCARE - INSTRUMENTATION 0.3%
Medtronic, Inc. 50,000 3,596,875
HEALTHCARE - PATIENT CARE 0.9%
Columbia/HCA Healthcare Corporation 255,000 6,295,312
United Healthcare Corporation 70,000 3,928,750
-----------
10,224,062
HOUSEHOLD APPLIANCES & FURNISHINGS 0.2%
Sony Corporation Sponsored ADR 30,000 2,775,000
HOUSING RELATED 0.2%
USG Corporation 50,000 2,918,750
INSURANCE - DIVERSIFIED 0.7%
Marsh & McLennan Companies, Inc. 105,000 8,039,062
INSURANCE - PROPERTY & CASUALTY 1.1%
American International Group, Inc. 85,000 9,982,188
Chubb Corporation 50,000 2,962,500
-----------
12,944,688
LEISURE PRODUCT 0.9%
Eastman Kodak Company 50,000 3,731,250
Harley-Davidson, Inc. 80,000 4,770,000
The Seagram Company, Ltd. 30,000 1,721,250
-----------
10,222,500
MACHINERY - AGRICULTURE 1.2%
Case Corporation 230,000 7,963,750
Deere & Company 155,000 6,665,000
-----------
14,628,750
MACHINERY - MISCELLANEOUS 0.4%
Ingersoll-Rand Company 75,000 5,189,063
MACHINERY - TRANSPORTATION EQUIP & PARTS 0.3%
Dana Corporation 80,000 3,770,000
MEDIA - RADIO/TV 1.7%
CBS Corporation (b) 230,000 10,479,375
Clear Channel Communications, Inc. (b) 60,000 4,170,000
Time Warner, Inc. 75,000 5,250,000
-----------
19,899,375
METALS & MINING 1.9%
Alcoa, Inc. 60,000 3,735,000
Asarco, Inc. 90,000 1,653,750
Freeport-McMoran Copper & Gold, Inc. Class B 240,000 3,675,000
Inco, Ltd. 200,000 3,837,500
Phelps Dodge Corporation 90,000 5,692,500
Reynolds Metals Company 60,000 3,742,500
-----------
22,336,250
NATURAL GAS DISTRIBUTION 1.7%
Enron Corporation 110,000 8,277,500
The Williams Companies, Inc. 255,000 12,048,750
-----------
20,326,250
OIL - INTERNATIONAL INTEGRATED 3.2%
BP Amoco PLC Sponsored ADR 30,000 3,395,625
Chevron Corporation 101,000 10,074,750
Mobil Corporation 130,000 13,617,500
Texaco, Inc. 175,000 10,981,250
-----------
38,069,125
OIL - NORTH AMERICAN EXPLORATION & PRODUCTION 0.2%
Apache Corporation 60,000 1,841,250
OIL - NORTH AMERICAN INTEGRATED 1.9%
Atlantic Richfield Company 205,000 17,207,188
USX-Marathon Group 150,000 4,687,500
-----------
21,894,688
OIL WELL EQUIPMENT & SERVICE 3.6%
Baker Hughes, Inc. 475,000 14,190,625
Halliburton Company 255,000 10,869,375
Schlumberger, Ltd. 260,000 16,607,500
-----------
41,667,500
PAPER & FOREST PRODUCTS 1.1%
Georgia-Pacific Corporation 140,000 12,950,000
POLLUTION CONTROL 0.3%
Waste Management, Inc. 55,000 3,107,500
RAILROAD 0.2%
Burlington Northern Santa Fe Corporation 50,000 1,831,250
RETAIL - DEPARTMENT STORE 1.2%
Kohl's Corporation (b) 217,600 14,456,800
RETAIL - DRUG STORE 0.2%
Walgreen Company 100,000 2,687,500
RETAIL - FOOD CHAIN 0.7%
The Kroger Company (b) 10,000 543,125
Fred Meyer, Inc. (b) 70,000 3,788,750
Safeway, Inc. (b) 75,000 4,045,313
-----------
8,377,188
RETAIL - MAJOR CHAIN 2.5%
Costco Companies, Inc. 140,000 11,331,250
Wal-Mart Stores, Inc. 390,000 17,940,000
-----------
29,271,250
26
<PAGE>
- --------------------------------------------------------------------------------
================================================================================
STRONG TOTAL RETURN FUND (continued)
================================================================================
Shares or
Principal Value
Amount (Note 2)
- --------------------------------------------------------------------------------
RETAIL - RESTAURANT 0.8%
McDonald's Corporation 220,000 $ 9,322,500
RETAIL - SPECIALTY 2.3%
Gap, Inc. 50,000 3,328,125
The Home Depot, Inc. 99,200 5,945,800
Lowe's Companies, Inc. 185,000 9,758,750
Staples, Inc. (b) 275,000 8,250,000
------------
27,282,675
SHOE & APPAREL MANUFACTURING 1.1%
NIKE, Inc. Class B 210,000 13,059,375
SOAP & CLEANING PREPARATION 0.4%
Colgate Palmolive Company 50,000 5,121,875
TELECOMMUNICATION EQUIPMENT 5.1%
ADC Telecommunications, Inc. (b) 50,000 2,390,625
Lucent Technologies, Inc. 255,000 15,331,875
Nokia Corporation Sponsored ADR 180,000 13,353,750
Nortel Network Corporation 115,000 7,841,562
Tellabs, Inc. (b) 170,000 18,625,625
Uniphase Corporation (b) 20,000 2,427,500
------------
59,970,937
TELECOMMUNICATION SERVICE 9.6%
COLT Telecom Group PLC Sponsored ADR (b) 100,000 7,637,500
Corning, Inc. 200,000 11,450,000
Level 3 Communications, Inc. (b) 135,000 12,158,437
MCI WorldCom, Inc. (b) 450,000 36,984,375
MediaOne Group, Inc. (b) 65,000 5,301,563
Qwest Communications International, Inc. (b) 300,000 25,631,250
Sprint Corporation 100,000 10,256,250
Sprint Corporation - PCS Group (b) 75,000 3,178,125
------------
112,597,500
TELEPHONE 1.2%
Ameritech Corporation 30,000 2,053,125
SBC Communications, Inc. 75,000 4,200,000
Telefonos de Mexico SA ADR Series L 110,000 8,332,500
------------
14,585,625
- --------------------------------------------------------------------------------
Total Common Stocks (Cost $888,746,740) 1,114,305,987
- --------------------------------------------------------------------------------
Convertible Preferred Stocks 2.5%
Chancellor Media Corporation 6.00%
(Acquired 6/11/97; Cost $3,000,000) (d) 60,000 6,540,000
Houston Industries, Inc. 7.00% Automatic
Common Exchange Securities 130,000 15,340,000
Merrill Lynch & Company, Inc. Structured
Yield Product (Exchangeable for Cox
Communications, Inc. Common Stock), 6.00%,
Due 6/01/99 125,000 7,843,750
- --------------------------------------------------------------------------------
Total Convertible Preferred Stocks (Cost $13,649,655) 29,723,750
- --------------------------------------------------------------------------------
Convertible Bonds 0.4%
The Home Depot, Inc. Subordinated Notes, 3.25%,
Due 10/01/01 $2,000,000 5,200,000
- --------------------------------------------------------------------------------
Total Convertible Bonds (Cost $2,121,716) 5,200,000
- --------------------------------------------------------------------------------
Short-Term Investments (a) 3.6%
COMMERCIAL PAPER 0.4%
INTEREST BEARING, DUE UPON DEMAND
General Mills, Inc., 4.51% 2,156,300 2,156,300
Pitney Bowes Credit Corporation, 4.51% 2,217,100 2,217,100
Sara Lee Corporation, 4.50% 63,000 63,000
Warner Lambert Company, 4.50% 307,000 307,000
-----------
4,743,400
REPURCHASE AGREEMENTS 3.2%
Barclays Capital, Inc. (Dated 4/30/99), 4.83%,
Due 5/03/99 (Repurchase proceeds
$37,415,053.50); Collateralized by United States
Treasury Notes,(e) $37,400,000 $ 37,400,000
- --------------------------------------------------------------------------------
Total Short-Term Investments (Cost $42,143,400) 42,143,400
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments in Securities (Cost $946,661,511) 101.0% 1,191,373,137
Other Assets and Liabilities, Net (1.0%) (12,294,193)
- --------------------------------------------------------------------------------
Net Assets 100.0% $1,179,078,944
================================================================================
WRITTEN OPTIONS ACTIVITY
- --------------------------------------------------------------------------------
Contracts Premiums
- --------------------------------------------------------------------------------
Options outstanding at beginning of period 200 $ 254,966
Options written during the period 5,680 7,887,275
Options closed (4,150) (5,438,114)
Options expired -- --
Options exercised -- --
------ ----------
Options outstanding at end of period 1,730 $2,704,127
====== ==========
Closed options resulted in a capital loss of $378,786.
WRITTEN OPTIONS DETAIL
- --------------------------------------------------------------------------------
Contracts
(100 Shares Value
per Contract) (Note 2)
- --------------------------------------------------------------------------------
America Online, Inc.
(Strike Price is $130. Expiration date is 6/18/99.
Premium Received is $880,321.) 300 ($ 742,500)
EMC Communications Corporation
(Strike Price is $110. Expiration date is 7/16/99.
Premium Received is $732,018.) 580 (703,250)
MCI WorldCom, Inc.
(Strike Price is $70. Expiration date is 6/18/99.
Premium Received is $1,091,789.) 850 (1,211,250)
LEGEND
- --------------------------------------------------------------------------------
(a) Short-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) See Note 2(I) of Notes to Financial Statements.
Percentages are stated as a percent of net assets.
See Notes to Financial Statements.
27
<PAGE>
<TABLE>
STATEMENTS OF ASSETS AND LIABILITIES
- -----------------------------------------------------------------------------------------------------------------------
April 30, 1999 (Unaudited)
<CAPTION>
(In Thousands, Except Per Share Amounts)
STRONG AMERICAN STRONG ASSET STRONG BLUE STRONG EQUITY
UTILITIES FUND ALLOCATION FUND CHIP 100 FUND INCOME FUND
--------------- --------------- ------------- -------------
ASSETS:
Investments in Securities, at Value (Cost of $192,556,
<S> <C> <C> <C> <C>
$257,839, $384,427 and $128,585, respectively) $244,210 $341,466 $432,842 $190,990
Receivable for Securities Sold 1,714 1,172 -- --
Receivable for Fund Shares Sold 110 3 252 21
Dividends and Interest Receivable 783 2,512 242 178
Other Assets 17 36 16 38
-------- -------- -------- --------
Total Assets 246,834 345,189 433,352 191,227
LIABILITIES:
Payable for Securities Purchased 1,252 2,067 393 942
Payable for Fund Shares Redeemed 120 -- 11 15
Accrued Operating Expenses and Other Liabilities 25 26 70 34
-------- -------- -------- --------
Total Liabilities 1,397 2,093 474 991
-------- -------- -------- --------
NET ASSETS $245,437 $343,096 $432,878 $190,236
======== ======== ======== ========
NET ASSETS CONSIST OF:
Capital Stock (par value and paid-in capital) $181,599 $248,943 $386,053 $125,265
Accumulated Net Investment Income (Loss) 550 1,844 (249) 65
Accumulated Net Realized Gain (Loss) 11,634 8,662 (1,341) 2,501
Net Unrealized Appreciation 51,654 83,647 48,415 62,405
-------- -------- -------- --------
Net Assets $245,437 $343,096 $432,878 $190,236
======== ======== ======== ========
Capital Shares Outstanding (Unlimited Number Authorized) 14,338 13,739 25,331 9,363
NET ASSET VALUE PER SHARE $17.12 $24.97 $17.09 $20.32
====== ====== ====== ======
</TABLE>
<TABLE>
<CAPTION>
STRONG GROWTH STRONG LIMITED STRONG TOTAL
AND INCOME FUND RESOURCES FUND RETURN FUND
--------------- -------------- ------------
ASSETS:
Investments in Securities, at Value
<S> <C> <C> <C>
(Cost of $500,545, $6,313 and $946,662, respectively) $687,663 $6,830 $1,191,373
Receivable for Securities Sold 5,460 -- 49,442
Receivable for Fund Shares Sold 160 -- 8
Dividends and Interest Receivable 436 3 301
Other Assets 34 21 60
-------- ------ ----------
Total Assets 693,753 6,854 1,241,184
LIABILITIES:
Payable for Securities Purchased 9,079 72 59,226
Written Options, at Value (Premiums Received of $0,
$0 and $2,704, respectively) -- -- 2,657
Payable for Fund Shares Redeemed 64 -- 173
Accrued Operating Expenses and Other Liabilities 59 11 49
-------- ------ ----------
Total Liabilities 9,202 83 62,105
-------- ------ ----------
NET ASSETS $684,551 $6,771 $1,179,079
======== ====== ==========
NET ASSETS CONSIST OF:
Capital Stock (par value and paid-in capital) $500,591 $7,234 $ 727,109
Accumulated Net Investment Loss (298) (8) (979)
Accumulated Net Realized Gain (Loss) (2,860) (972) 208,190
Net Unrealized Appreciation 187,118 517 244,759
-------- ------ ----------
Net Assets $684,551 $6,771 $1,179,079
======== ====== ==========
Capital Shares Outstanding (Unlimited Number Authorized) 28,889 756 30,213
NET ASSET VALUE PER SHARE $23.70 $8.95 $39.03
====== ===== ======
</TABLE>
See Notes to Financial Statements.
28
<PAGE>
<TABLE>
STATEMENTS OF OPERATIONS
- ---------------------------------------------------------------------------------------------------------------------------
For the Six Months Ended April 30, 1999 (Unaudited)
(In Thousands)
<CAPTION>
STRONG STRONG STRONG STRONG STRONG STRONG STRONG
AMERICAN ASSET BLUE CHIP EQUITY GROWTH LIMITED TOTAL
UTILITIES ALLOCATION 100 INCOME AND INCOME RESOURCES RETURN
FUND FUND FUND FUND FUND FUND FUND
--------- ---------- --------- ------ ---------- --------- ------
INCOME:
Dividends (net of withholding taxes
of ($0, $4, $0, $0, $4, $0 and $13,
<S> <C> <C> <C> <C> <C> <C> <C>
respectively) $ 3,600 $ 1,343 $ 952 $ 1,254 $ 2,626 $ 37 $ 3,480
Interest 320 4,480 201 36 99 12 921
------- ------- ------- ------- -------- ------ --------
Total Income 3,920 5,823 1,153 1,290 2,725 49 4,401
EXPENSES:
Investment Advisory Fees 888 1,300 904 738 2,136 24 4,186
Custodian Fees 14 14 58 5 16 1 44
Shareholder Servicing Costs 228 292 253 167 614 7 735
Professional Fees 10 14 11 9 13 3 20
Reports to Shareholders 39 59 79 35 131 1 159
Federal and State Registration Fees 21 18 85 18 59 12 20
Other 5 7 6 11 13 3 21
------- ------- ------- ------- -------- ------ --------
Total Expenses 1,205 1,704 1,396 983 2,982 51 5,185
------- ------- ------- ------- -------- ------ --------
NET INVESTMENT INCOME (LOSS) 2,715 4,119 (243) 307 (257) (2) (784)
REALIZED AND UNREALIZED GAIN (LOSS):
Net Realized Gain (Loss) on:
Investments 12,207 8,272 489 3,399 4,984 (305) 222,122
Futures Contracts and Options -- 618 -- -- -- -- (379)
------- ------- ------- ------- -------- ------ --------
Net Realized Gain (Loss) 12,207 8,890 489 3,399 4,984 (305) 221,743
Net Change in Unrealized Appreciation/
Depreciation on:
Investments 6,633 42,912 41,217 26,953 111,343 1,166 82,801
Futures Contracts and Options -- (650) -- -- -- -- 47
------- ------- ------- ------- -------- ------ --------
Net Change in Unrealized
Appreciation/Depreciation 6,633 42,262 41,217 26,953 111,343 1,166 82,848
------- ------- ------- ------- -------- ------ --------
NET GAIN ON INVESTMENTS 18,840 51,152 41,706 30,352 116,327 861 304,591
------- ------- ------- ------- -------- ------ --------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $21,555 $55,271 $41,463 $30,659 $116,070 $ 859 $303,807
======= ======= ======= ======= ======== ====== ========
</TABLE>
See Notes to Financial Statements.
29
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
- -------------------------------------------------------------------------------------------------------------------------------
(In Thousands)
<CAPTION>
STRONG AMERICAN STRONG ASSET
UTILITIES FUND ALLOCATION FUND
-------------------------------- --------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
April 30, 1999 Oct. 31, 1998 April 30, 1999 Oct. 31, 1998
---------------- ------------- ---------------- -------------
(Unaudited) (Unaudited)
OPERATIONS:
<S> <C> <C> <C> <C>
Net Investment Income $ 2,715 $ 4,546 $ 4,119 $ 7,355
Net Realized Gain 12,207 8,595 8,890 798
Net Change in Unrealized Appreciation/Depreciation 6,633 26,422 42,262 23,055
-------- -------- -------- --------
Net Increase in Net Assets Resulting from Operations 21,555 39,563 55,271 31,208
DISTRIBUTIONS:
From Net Investment Income (2,704) (4,541) (3,131) (7,231)
From Net Realized Gains (8,562) (8,984) -- (25,895)
In Excess of Net Realized Gains -- -- -- (281)
-------- -------- -------- --------
Total Distributions (11,266) (13,525) (3,131) (33,407)
CAPITAL SHARE TRANSACTIONS:
Proceeds from Shares Sold 71,769 167,228 27,799 39,754
Proceeds from Reinvestment of Distributions 10,673 12,867 3,003 32,136
Payment for Shares Redeemed (61,559) (126,663) (28,238) (58,057)
-------- -------- -------- --------
Net Increase in Net Assets from Capital Share Transactions 20,883 53,432 2,564 13,833
-------- -------- -------- --------
TOTAL INCREASE IN NET ASSETS 31,172 79,470 54,704 11,634
NET ASSETS:
Beginning of Period 214,265 134,795 288,392 276,758
-------- -------- -------- --------
End of Period $245,437 $214,265 $343,096 $288,392
======== ======== ======== ========
TRANSACTIONS IN SHARES OF THE FUND:
Sold 4,332 10,931 1,172 1,850
Issued in Reinvestment of Distributions 636 859 126 1,623
Redeemed (3,766) (8,303) (1,198) (2,743)
------ ------ ------ ------
Net Increase in Shares of the Fund 1,202 3,487 100 730
====== ====== ====== ======
</TABLE>
See Notes to Financial Statements.
30
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
- -------------------------------------------------------------------------------------------------------------------------
(In Thousands)
<CAPTION>
STRONG BLUE STRONG EQUITY
CHIP 100 FUND INCOME FUND
-------------------------------- --------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
April 30, 1999 Oct. 31, 1998 April 30, 1999 Oct. 31, 1998
---------------- ------------- ---------------- -------------
(Unaudited) (Unaudited)
OPERATIONS:
<S> <C> <C> <C> <C>
Net Investment Income (Loss) ($ 243) $ 288 $ 307 $ 1,095
Net Realized Gain (Loss) 489 (1,799) 3,399 (473)
Net Change in Unrealized Appreciation/Depreciation 41,217 7,230 26,953 19,078
-------- ------- -------- --------
Net Increase in Net Assets Resulting from Operations 41,463 5,719 30,659 19,700
DISTRIBUTIONS:
From Net Investment Income (6) (296) (312) (1,075)
From Net Realized Gains -- -- -- (5,636)
In Excess of Net Realized Gains -- -- -- (416)
-------- ------- -------- --------
Total Distributions (6) (296) (312) (7,127)
CAPITAL SHARE TRANSACTIONS:
Proceeds from Shares Sold 373,109 112,429 36,960 88,635
Proceeds from Reinvestment of Distributions 6 278 299 6,807
Payment for Shares Redeemed (71,602) (33,375) (48,126) (71,745)
-------- ------- -------- --------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 301,513 79,332 (10,867) 23,697
-------- ------- -------- --------
TOTAL INCREASE IN NET ASSETS 342,970 84,755 19,480 36,270
NET ASSETS:
Beginning of Period 89,908 5,153 170,756 134,486
-------- ------- -------- --------
End of Period $432,878 $89,908 $190,236 $170,756
======== ======= ======== ========
TRANSACTIONS IN SHARES OF THE FUND:
Sold 22,963 8,949 1,923 5,275
Issued in Reinvestment of Distributions -- 22 15 436
Redeemed (4,424) (2,674) (2,501) (4,278)
------ ------ ------ ------
Net Increase (Decrease) in Shares of the Fund 18,539 6,297 (563) 1,433
====== ====== ====== ======
</TABLE>
See Notes to Financial Statements.
31
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
- -----------------------------------------------------------------------------------------------------------------------------------
(In Thousands)
<CAPTION>
STRONG GROWTH STRONG LIMITED
AND INCOME FUND RESOURCES FUND
-------------------------------- --------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
April 30, 1999 Oct. 31, 1998 April 30, 1999 Oct. 31, 1998
---------------- ------------- ---------------- -------------
(Unaudited) (Unaudited)
OPERATIONS:
<S> <C> <C> <C> <C>
Net Investment Income (Loss) ($ 257) $ 447 ($ 2) ($ 23)
Net Realized Gain (Loss) 4,984 (7,055) (305) (668)
Net Change in Unrealized Appreciation/Depreciation 111,343 53,134 1,166 (373)
-------- -------- ------ ------
Net Increase (Decrease) in Net Assets Resulting from Operations 116,070 46,526 859 (1,064)
DISTRIBUTIONS:
From Net Investment Income (59) (478) (7) (1)
From Net Realized Gains 0 (9,141) 0 (2)
In Excess of Realized Gains -- (797) -- --
-------- -------- ------ ------
Total Distributions (59) (10,416) (7) (3)
CAPITAL SHARE TRANSACTIONS:
Proceeds from Shares Sold 273,129 266,590 3,558 4,984
Proceeds from Reinvestment of Distributions 58 10,114 7 3
Payment for Shares Redeemed (103,535) (140,926) (2,592) (4,319)
-------- -------- ------ ------
Net Increase in Net Assets from Capital Share Transactions 169,652 135,778 973 668
-------- -------- ------ ------
TOTAL INCREASE (DECREASE) IN NET ASSETS 285,663 171,888 1,825 (399)
NET ASSETS:
Beginning of Period 398,888 227,000 4,946 5,345
-------- -------- ------ ------
End of Period $684,551 $398,888 $6,771 $4,946
======== ======== ====== ======
TRANSACTIONS IN SHARES OF THE FUND:
Sold 12,341 14,701 466 570
Issued in Reinvestment of Distributions 3 632 1 0
Redeemed (4,750) (7,921) (345) (497)
------ ------ ---- ----
Net Increase in Shares of the Fund 7,594 7,412 122 73
====== ====== ==== ====
</TABLE>
See Notes to Financial Statements.
32
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS (continued)
- --------------------------------------------------------------------------------------
(In Thousands)
<CAPTION>
STRONG TOTAL
RETURN FUND
---------------------------------
Six Months Ended Year Ended
April 30, 1999 Oct. 31, 1998
---------------- -------------
(Unaudited)
OPERATIONS:
<S> <C> <C>
Net Investment Income (Loss) ($ 784) $ 3,536
Net Realized Gain 221,743 3,209
Net Change in Unrealized Appreciation/Depreciation 82,848 99,387
---------- --------
Net Increase in Net Assets Resulting from Operations 303,807 106,132
DISTRIBUTIONS:
From Net Investment Income (195) (3,788)
In Excess of Net Investment Income (11,003) (172,676)
From Net Realized Gains -- (2,593)
---------- --------
Total Distributions (11,198) (179,057)
CAPITAL SHARE TRANSACTIONS:
Proceeds from Shares Sold 143,131 220,335
Proceeds from Reinvestment of Distributions 10,867 174,336
Payment for Shares Redeemed (130,176) (290,682)
---------- --------
Increase in Net Assets from Capital Share Transactions 23,822 103,989
---------- --------
TOTAL INCREASE IN NET ASSETS 316,431 31,064
NET ASSETS:
Beginning of Period 862,648 831,584
---------- --------
End of Period $1,179,079 $862,648
========== ========
TRANSACTIONS IN SHARES OF THE FUND:
Sold 3,976 7,400
Issued in Reinvestment of Distributions 314 6,717
Redeemed (3,723) (9,929)
------ ------
Net Increase in Shares of the Fund 567 4,188
====== ======
</TABLE>
See Notes to Financial Statements.
33
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
April 30, 1999 (Unaudited)
1. ORGANIZATION
The accompanying financial statements represent the Strong Conservative
Equity Funds (the "Funds"), which include the following funds, each with
its own investment objectives and policies:
- Strong American Utilities Fund(3) (a series of Strong Conservative
Equity Funds, Inc.(1))
- Strong Asset Allocation Fund, Inc.(1) (2)
- Strong Blue Chip 100 Fund(2) (a series of Strong Conservative Equity
Funds, Inc.(1))
- Strong Equity Income Fund(2) (a series of Strong Conservative Equity
Funds, Inc.(1))
- Strong Growth and Income Fund(2) (a series of Strong Conservative
Equity Funds, Inc.(1))
- Strong Limited Resources Fund(2) (a series of Strong Conservative
Equity Funds, Inc.(1))
- Strong Total Return Fund, Inc.(1) (2)
(1) An open-end management investment company registered under the
Investment Company Act of 1940.
(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 -- Portfolio securities traded primarily on a
principal securities exchange are valued at the last reported sales
price or the mean between the latest bid and asked prices when no last
sales price is available. Securities traded over-the-counter are
valued at the mean of the latest bid and asked prices or the last
reported sales price. 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, 1999 were as follows:
Aggregate Aggregate Percent of
Cost Fair Value Net Assets Liquid*
--------- ---------- ---------- -------
STRONG ASSET ALLOCATION FUND $23,326,179 $23,381,100 6.8% 99.7%
STRONG TOTAL RETURN FUND 3,000,000 6,540,000 0.6% 100.0%
*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.
The character of distributions made during the year from 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.
(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.
34
<PAGE>
- --------------------------------------------------------------------------------
Investments in foreign denominated assets or forward foreign currency
contracts may involve greater risks than domestic investments,
including currency, political and 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. 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. 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.
(G) Foreign Currency Translation -- Investment securities and other assets
and liabilities initially expressed in foreign currencies are
converted 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) Repurchase Agreements -- The Funds may enter into repurchase
agreements with institutions that the Funds' investment advisor,
Strong Capital Management, Inc. ("the Advisor"), has determined are
creditworthy pursuant to criteria adopted by the Board of Directors.
Each repurchase agreement is recorded at cost. The Funds require that
the collateral, represented by securities (primarily U.S. Government
securities), in a repurchase transaction be maintained in a segregated
account with a custodian bank in a manner sufficient to enable the
Funds to obtain those securities in the event of a default of the
repurchase agreement. On a daily basis, the Advisor monitors each
repurchase agreement to ensure the value of the collateral, including
accrued interest, is at least equal to the amounts owed to the Funds
under each repurchase agreement.
(J) 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.
(K) 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
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 American
Utilities Fund and Strong Blue Chip 100 Fund 0.75%, Strong Equity Income
Fund and Strong Growth and Income Fund 0.80%, Strong Asset Allocation Fund
and Strong Total Return Fund 0.85% of the first $35 million and 0.80%
thereafter, and Strong Limited Resources Fund 1.00%. Based on the terms of
the Advisory Agreements, advisory fees and other expenses will be waived 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 their discretion. Shareholder
recordkeeping and related service fees are based on contractually
established rates for each open and closed shareholder account. The Advisor
is compensated for certain other services related to costs incurred for
reports to shareholders.
W. H. Reaves & Co., Inc. ("Reaves") manages the investments of Strong
American Utilities Fund under an agreement with the Advisor. Reaves is
compensated by the Advisor (not the Fund) and bears all of its own expenses
in providing subadvisory services. In addition, Reaves directly effects
purchases and sales of securities for the Fund. In conjunction therewith,
brokerage commissions paid by the Fund for the six months ended April 30,
1999 totaled $232,176.
35
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
April 30, 1999 (Unaudited)
Scarborough Investment Advisors LLC manages the investments of Strong
Limited Resources Fund under an agreement with the Advisor. Scarborough is
compensated by the Advisor (not the Fund) and bears all of its own expenses
in providing subadvisory services.
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
effects of waivers and absorptions, for the six months ended April 30, 1999
is as follows:
Shareholder
Payable to Servicing and Other Unaffiliated
Advisor at Expenses Paid Directors'
April 30, 1999 to Advisor Fees
-------------- ------------------- ------------
STRONG AMERICAN UTILITIES FUND $15,739 $237,780 $1,714
STRONG ASSET ALLOCATION FUND 12,338 298,971 2,092
STRONG BLUE CHIP 100 FUND 2,621 245,736 1,060
STRONG EQUITY INCOME FUND 19,950 167,130 1,493
STRONG GROWTH AND INCOME FUND 20,576 614,282 2,350
STRONG LIMITED RESOURCES FUND 6,056 6,649 750
STRONG TOTAL RETURN FUND 19,689 760,393 4,936
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 individual Funds, borrowings under the LOC
are limited to either the lesser of 15% of the market value of total assets
or any explicit borrowing limits in the Funds' prospectus. Borrowings under
the LOC bear interest based on prevailing market rates as defined in the
LOC. A commitment fee of .07% per annum is incurred on the unused portion
of the line of credit and is allocated to all participating Strong Funds.
At April 30, 1999, there were no borrowings by the Funds outstanding under
the LOC.
5. INVESTMENT TRANSACTIONS
The aggregate purchases and sales of long-term securities for the six
months ended April 30, 1999 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 AMERICAN UTILITIES FUND $ -- $ 90,342,606 $ -- $ 77,641,298
STRONG ASSET ALLOCATION FUND 3,000,988 85,962,395 820,757 103,567,195
STRONG BLUE CHIP 100 FUND -- 360,512,346 -- 64,770,025
STRONG EQUITY INCOME FUND -- 36,278,319 -- 43,277,889
STRONG GROWTH AND INCOME FUND -- 357,577,441 -- 187,826,401
STRONG LIMITED RESOURCES FUND -- 1,767,570 -- 943,186
STRONG TOTAL RETURN FUND -- 2,082,463,365 -- 2,044,955,662
</TABLE>
6. INCOME TAX INFORMATION
The investment cost, gross unrealized appreciation and depreciation on
investments and capital loss carryovers (expiring in varying amounts
through 2006) for federal income tax purposes were as follows:
<TABLE>
<CAPTION>
at April 30, 1999 at October 31, 1998
--------------------------------------------------------------- -------------------
Net
Federal Tax Unrealized Unrealized Appreciation/ Net Capital Loss
Cost Appreciation Depreciation (Depreciation) Carryovers
------------ ------------ ------------ -------------- ----------------
<S> <C> <C> <C> <C> <C>
STRONG AMERICAN UTILITIES FUND $169,352,013 $ 45,819,827 $1,321,821 $ 44,498,006 $ --
STRONG ASSET ALLOCATION FUND 246,145,312 47,716,511 7,232,255 40,484,256 176,328
STRONG BLUE CHIP 100 FUND 83,599,939 10,148,092 3,704,133 6,443,959 1,077,525
STRONG EQUITY INCOME FUND 136,379,837 36,645,373 1,899,891 34,745,482 191,385
STRONG GROWTH AND INCOME FUND 324,605,636 78,331,805 4,972,773 73,359,032 5,428,554
STRONG LIMITED RESOURCES FUND 5,581,707 153,934 802,260 (648,326) 677,226
STRONG TOTAL RETURN FUND 708,890,711 153,274,991 4,961,790 148,313,201 --
</TABLE>
36
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
- -------------------------------------------------------------------------------------------------------------------------
STRONG AMERICAN UTILITIES FUND
- -------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Period Ended
------------------------------------------------------------
April 30, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Dec. 31,
Selected Per-Share Data(a) 1999(b) 1998 1997 1996 1995(c) 1994
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $16.31 $13.97 $12.64 $11.73 $ 9.46 $10.19
Income From Investment Operations
Net Investment Income 0.19 0.35 0.40 0.40 0.27 0.46
Net Realized and Unrealized Gains (Losses) on Investments 1.42 3.12 1.98 0.90 2.25 (0.73)
- -------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 1.61 3.47 2.38 1.30 2.52 (0.27)
Less Distributions
From Net Investment Income (0.19) (0.37) (0.38) (0.39) (0.25) (0.46)
From Net Realized Gains (0.61) (0.76) (0.67) -- -- --
Total Distributions (0.80) (1.13) (1.05) (0.39) (0.25) (0.46)
- -------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $17.12 $16.31 $13.97 $12.64 $11.73 $ 9.46
=========================================================================================================================
Ratios and Supplemental Data
- -------------------------------------------------------------------------------------------------------------------------
Total Return +10.0% +25.7% +19.7% +11.2% +26.9% -2.6%
Net Assets, End of Period (In Millions) $245 $214 $135 $122 $92 $38
Ratio of Expenses to Average Net Assets 1.0%* 1.0% 1.1% 1.2% 1.2%* 0.5%
Ratio of Expenses to Average Net Assets without Waivers 1.0%* 1.0% 1.1% 1.2% 1.2%* 1.6%
Ratio of Net Investment Income to Average Net Assets 2.3%* 2.4% 3.0% 3.2% 3.4%* 4.8%
Portfolio Turnover Rate 35.1% 69.0% 61.9% 84.0% 56.4% 105.4%
</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, 1999 (unaudited).
(c) In 1995, the Fund changed its fiscal year end from December to October.
<TABLE>
STRONG ASSET ALLOCATION FUND
- -------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Period Ended
------------------------------------------------------------
April 30, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Dec. 31,
Selected Per-Share Data(a) 1999(b) 1998 1997 1996 1995(c) 1994
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $21.14 $21.44 $20.12 $20.31 $17.91 $19.06
Income From Investment Operations
Net Investment Income 0.30 0.55 0.67 0.78 0.66 0.70
Net Realized and Unrealized Gains (Losses) on Investments 3.76 1.75 2.96 1.05 2.32 (0.99)
- -------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 4.06 2.30 3.63 1.83 2.98 (0.29)
Less Distributions
From Net Investment Income (0.23) (0.54) (0.67) (0.84) (0.58) (0.70)
In Excess of Net Investment Income -- -- (0.10) -- -- --
From Net Realized Gains -- (2.04) (1.54) (1.18) -- --
In Excess of Net Realized Gains -- (0.02) -- -- -- (0.16)
- -------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.23) (2.60) (2.31) (2.02) (0.58) (0.86)
- -------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $24.97 $21.14 $21.44 $20.12 $20.31 $17.91
=========================================================================================================================
Ratios and Supplemental Data
- -------------------------------------------------------------------------------------------------------------------------
Total Return +19.3% +11.8% +19.3% +9.5% +16.8% -1.5%
Net Assets, End of Period (In Millions) $343 $288 $277 $263 $261 $249
Ratio of Expenses to Average Net Assets 1.1% 1.0% 1.1% 1.1% 1.2%* 1.2%
Ratio of Net Investment Income to Average Net Assets 2.6% 2.5% 3.2% 3.9% 4.1%* 3.8%
Portfolio Turnover Rate 29.0% 185.9% 276.5% 446.7% 326.8% 359.70%
</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, 1999 (unaudited).
(c) In 1995, the Fund changed its fiscal year end from December to October.
See Notes to Financial Statements.
37
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS (continued)
- ---------------------------------------------------------------------------------------------
STRONG BLUE CHIP 100 FUND
- ---------------------------------------------------------------------------------------------
<CAPTION>
Period Ended
--------------------------------
April 30, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 1999(b) 1998 1997(c)
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $13.24 $10.39 $10.00
Income From Investment Operations
Net Investment Income (Loss) (0.01) 0.10 0.01
Net Realized and Unrealized Gains on Investments 3.86 2.86 0.38
- ---------------------------------------------------------------------------------------------
Total from Investment Operations 3.85 2.96 0.39
Less Distributions
From Net Investment Income (0.00)(d) (0.11) --
- ---------------------------------------------------------------------------------------------
Total Distributions (0.00)(d) (0.11) --
- ---------------------------------------------------------------------------------------------
Net Asset Value, End of Period $17.09 $13.24 $10.39
=============================================================================================
Ratios and Supplemental Data
- ---------------------------------------------------------------------------------------------
Total Return +29.1% +28.6% +3.9%
Net Assets, End of Period (In Millions) $433 $90 $5
Ratio of Expenses to Average Net Assets 1.1%* 0.6% 1.0%*
Ratio of Expenses to Average Net Assets without Waivers 1.1%* 1.3% 2.0%*
Ratio of Net Investment Income (Loss) to Average Net Assets -0.2%* 0.7% 0.6%*
Portfolio Turnover Rate 27.1% 46.5% 21.5%
</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, 1999 (unaudited).
(c) For the period from June 30, 1997 (inception) to October 31, 1997.
(d) Amount calculated is less than $0.01 or 0.1%.
<TABLE>
STRONG EQUITY INCOME FUND
- ------------------------------------------------------------------------------------------------
<CAPTION>
Period Ended
----------------------------------------
April 30, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 1999(b) 1998 1997 1996(c)
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $17.20 $15.84 $12.03 $10.00
Income From Investment Operations
Net Investment Income 0.03 0.11 0.13 0.12
Net Realized and Unrealized Gains on Investments 3.12 2.05 3.81 2.02
- ------------------------------------------------------------------------------------------------
Total from Investment Operations 3.15 2.16 3.94 2.14
Less Distributions
From Net Investment Income (0.03) (0.11) (0.13) (0.11)
From Net Realized Gains -- (0.64) -- --
In Excess of Net Realized Gains -- (0.05) -- --
- ------------------------------------------------------------------------------------------------
Total Distributions (0.03) (0.80) (0.13) (0.11)
- ------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $20.32 $17.20 $15.84 $12.03
================================================================================================
Ratios and Supplemental Data
- ------------------------------------------------------------------------------------------------
Total Return +18.3% +14.2% +32.9% +21.5%
Net Assets, End of Period (In Millions) $190 $171 $134 $29
Ratio of Expenses to Average Net Assets 1.1%* 1.1% 1.1% 1.3%*
Ratio of Net Investment Income to Average Net Assets 0.3%* 0.7% 0.9% 1.6%*
Portfolio Turnover Rate 19.9% 83.2% 152.6% 158.3%
</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, 1999 (unaudited).
(c) For the period from December 29, 1995 (inception) to October 31, 1996.
See Notes to Financial Statements.
38
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS (continued)
- ------------------------------------------------------------------------------------------------------
STRONG GROWTH AND INCOME FUND
- ------------------------------------------------------------------------------------------------------
<CAPTION>
Period Ended
---------------------------------------
April 30, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 1999(b) 1998 1997 1996(c)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $18.73 $16.35 $12.38 $10.00
Income From Investment Operations
Net Investment Income (Loss) (0.01) 0.03 0.07 0.04
Net Realized and Unrealized Gains on Investments 4.98 3.07 3.99 2.38
- ------------------------------------------------------------------------------------------------------
Total from Investment Operations 4.97 3.10 4.06 2.42
Less Distributions
From Net Investment Income 0.00(d) (0.03) (0.07) (0.04)
From Net Realized Gains -- (0.62) (0.02) --
In Excess of Net Realized Gains -- (0.07) -- --
- ------------------------------------------------------------------------------------------------------
Total Distributions 0.00(d) (0.72) (0.09) (0.04)
- ------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $23.70 $18.73 $16.35 $12.38
======================================================================================================
Ratios and Supplemental Data
- ------------------------------------------------------------------------------------------------------
Total Return 26.6% 19.7% 32.9% 24.2%
Net Assets, End of Period (In Millions) $685 $399 $227 $18
Ratio of Expenses to Average Net Assets 1.1%* 1.1% 1.2% 1.9%*
Ratio of Net Investment Income (Loss) to Average Net Assets -1.0%* 0.1% 0.5% 0.6%*
Portfolio Turnover Rate 35.4% 107.5% 237.8% 174.1%
</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, 1999 (unaudited).
(c) For the period from December 29, 1995 (inception) to October 31, 1996.
(d) Amount calculated is less than $0.01 or 0.1%.
<TABLE>
STRONG LIMITED RESOURCES FUND
- ---------------------------------------------------------------------------------------------
<CAPTION>
Period Ended
-------------------------------
April 30, Oct. 31, Oct. 31,
Selected Per-Share Data(a) 1999(b) 1998 1997(c)
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $7.79 $9.51 $10.00
Income From Investment Operations
Net Investment Loss -- (0.04) --
Net Realized and Unrealized Gains (Losses) on Investments 1.17 (1.68) (0.49)
- ---------------------------------------------------------------------------------------------
Total from Investment Operations 1.17 (1.72) (0.49)
Less Distributions
From Net Investment Income (0.01) 0.00(d) --
- ---------------------------------------------------------------------------------------------
Total Distributions (0.01) 0.00(d) --
- ---------------------------------------------------------------------------------------------
Net Asset Value, End of Period $8.95 $7.79 $ 9.51
=============================================================================================
Ratios and Supplemental Data
Total Return +15.0% -18.0% -4.9%
Net Assets, End of Period (In Millions) $7 $5 $5
Ratio of Expenses to Average Net Assets 2.0%* 2.0% 2.0%*
Ratio of Net Investment Income (Loss) to Average Net Assets 0.0%*(d) -0.4% 0.0%*(d)
Portfolio Turnover Rate 20.3% 61.2% 1.2%
</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, 1999 (unaudited).
(c) For the period from September 30, 1997 (inception) to October 31, 1997.
(d) Amount calculated is less than $0.01 or 0.1%.
See Notes to Financial Statements.
39
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------------------------------------------------------
STRONG TOTAL RETURN FUND
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Period Ended
-----------------------------------------------------------------
April 30, Oct. 31, Oct. 31, Oct. 31, Oct. 31, Dec. 31,
Selected Per-Share Data(a) 1999(b) 1998 1997 1996 1995(c) 1994
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $29.10 $32.66 $31.36 $28.02 $23.62 $24.30
Income From Investment Operations
Net Investment Income (Loss) (0.03) 0.13 0.19 0.24 0.26 0.25
Net Realized and Unrealized Gains (Losses) on Investments 10.35 3.44 6.21 4.65 4.41 (0.59)
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 10.32 3.57 6.40 4.89 4.67 (0.34)
Less Distributions
From Net Investment Income (0.01) (0.14) (0.19) (0.24) (0.26) (0.26)
In Excess of Net Investment Income -- -- (0.17) (0.06) (0.01) (0.08)
From Net Realized Gains (0.38) (6.89) (4.74) (1.25) -- --
In Excess of Realized Gains -- (0.10) -- -- -- --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.39) (7.13) (5.10) (1.55) (0.27) (0.34)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $39.03 $29.10 $32.66 $31.36 $28.02 $23.62
================================================================================================================================
Ratios and Supplemental Data
- --------------------------------------------------------------------------------------------------------------------------------
Total Return +35.6% +13.6% +23.4% +18.0% +19.8% -1.4%
Net Assets, End of Period (In Millions) $1,179 $863 $832 $760 $671 $607
Ratio of Expenses to Average Net Assets 1.0%* 1.0% 1.1% 1.1% 1.1%* 1.2%
Ratio of Net Investment Income (Loss) to Average Net Assets -0.2%* 0.4% 0.6% 0.8% 1.2%* 1.1%
Portfolio Turnover Rate 204.4% 267.8% 404.6% 502.4% 298.8% 290.4%
</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, 1999 (unaudited).
(c) In 1995, the Fund changed its fiscal year end from December to October.
See Notes to Financial Statements.
40
<PAGE>
DIRECTORS
Richard S. Strong
Willie D. Davis
Stanley Kritzik
Marvin E. Nevins
William F. Vogt
OFFICERS
Richard S. Strong, Chairman of the Board
Mary F. Hoppa, Vice President
Thomas P. Lemke, Vice President
John S. Weitzer, Vice President
Stephen J. Shenkenberg, Vice President and Secretary
John W. Widmer, 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
Firstar Bank Milwaukee, N.A.
P.O. Box 701, Milwaukee, Wisconsin 53201
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.
[PICTURE OF TELEPHONE]
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
[PICTURE OF STRONG WEB SITE ON COMPUTER]
Strong On-line
www.strong-funds.com
[STRONG LOGO]
STRONG FUNDS
P.O. Box 2936 o Milwaukee, Wisconsin 53201
Strong Funds Distributors, Inc. 11918F99 SCEQ
<PAGE>
