Janus Aspen Series
1998
Semiannual Report
[LOGO] JANUS
<PAGE>
JANUS ASPEN GROWTH PORTFOLIO Portfolio Manager, James P. Craig
For the six months ended June 30, 1998, Janus Aspen Growth Portfolio
returned 19.24% for the Institutional Shares and 18.93% for the Retirement
Shares. This compares with the S&P 500 Index's appreciation of 17.72% for the
same period. All returns include reinvested dividends. The average annual total
returns for the period ended June 30, 1998, follow on the next page.
Our impressive gains were due largely to a repositioning within the
Portfolio late in the fourth quarter. This was followed by the strong
first-quarter performances of a number of our holdings in the technology,
pharmaceutical, and cable sectors. I viewed the market's first-quarter rally as
evidence that concerns about Asia's potential downward drag on corporate
earnings had been overpowered by optimism regarding low interest rates and
inflation, actually helped by the Asian crisis.
Financial Troubles Building in Asia
During the second quarter, however, the downturn in Asia again took center
stage. Concerns regarding the Japanese government's failure to stimulate its
economy were reflected in a significant decline in the yen. This sparked fears
that other Southeast Asian currencies may have to be devalued. Meanwhile,
volatility in U.S. stocks increased as anxiety over Asia's impact on future
corporate earnings deepened.
Although companies with significant exposure to Asia may indeed suffer
future earnings disappointments, I believe much of this fear has already been
reflected in revised earnings estimates. As for the Portfolio, I'm confident the
quality of our companies' earnings streams and their limited exposure to Asia
will enable them to deliver the results we expect.
Technology, Drug, and Cable Stocks Excel
I increased our position in the technology industry late last year when the
economic downturn in Asia made it possible to buy high-quality franchise names
at a discount. America Online, Dell Computer, Microsoft, and Cisco Systems all
posted strong results and are companies I view as the leaders of technological
change. I wasn't as optimistic about Intel, which I sold at a loss. Intel was
forced to reduce the price of its microprocessor chips to stay in sync with the
rising demand for sub-$1,000 personal computers, and, as a result, its profit
margin suffered.
Our positions in the pharmaceutical industry were also standouts.
Warner-Lambert and Pfizer each gained close to 50% as the strength of their
product pipelines enabled them to exceed expectations. However, we trimmed our
weighting in this industry in order to pursue more attractive investment ideas
and eliminated our Bristol-Myers Squibb, Cardinal Health, and SmithKline Beecham
positions, all at substantial profits.
Several of our pharmaceutical stocks also benefited from the evolving
consolidation within the agriculture, biotechnology, and drug industries. This
movement is driven by an attempt to pool resources to create more focused
research and development budgets, while leveraging marketing to capitalize on
scientific breakthroughs. For example, American Home Products' announced merger
with Monsanto, both of which were holdings in the Portfolio, would form the
third-largest drug/ agricultural/biotech company in the world. It would also
create a product pipeline that includes everything from arthritis medicine to
soybeans. I am extremely positive about the long-term potential of this company.
During much of the first half, our cable stocks held steady as they
consolidated substantial gains from last year. However, late in the second
quarter, the announced Tele-Communications, Inc. acquisition by AT&T prompted a
quick but significant appreciation among cable stocks. Further fueling my
enthusiasm for this industry was the successful introduction of telephony
services by MediaOne (formerly U.S. West Media Group), Comcast, and Cox
Communications. This, in addition to several other new value-added services
these companies plan to offer through their existing operating platforms, should
enable them to generate tremendous additional cash flow.
Two companies that did not perform to my expectations were Analog Devices
and Texas Instruments. The semiconductor industry has experienced significant
volatility as a result of falling Asian currencies and overcapacity, which have
forced down the price of components. Therefore, in an effort to position the
Portfolio for the long term, I reduced both of these holdings and added to
higher value-added semiconductor companies such as Linear Technology, Maxim
Integrated Products, and Applied Materials.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Equities 92.0% 91.3%
Foreign 7.4% 9.4%
Europe 5.2% 9.4%
Top 10 Equities 33.0% 27.1%
Number of Stocks 67 80
Cash & Cash Equivalents 8.0% 8.7%
- --------------------------------------------------------------------------------
Outlook for Stocks Still Positive
Going forward, our investment team is sensitive to the possibility that
continued deterioration in Asia could dampen the U.S. growth rate and that 1999
earnings expectations may be affected. We continue to monitor this situation
closely and remain focused on companies we believe are capable of successfully
managing Asian turbulence. Overall, we're generally optimistic on the outlook
for the market due to the fact that we expect interest rates and inflation to
stay at their current low levels and economic growth to remain strong, which
should provide a continued positive environment for equities.
We appreciate your investment in Janus Aspen Growth Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 1
<PAGE>
JANUS ASPEN GROWTH PORTFOLIO Portfolio Manager, James P. Craig
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 9/13/93)
1 Year 29.21%
From Inception 20.05%
- --------------------------------------------------------------------------------
S&P 500 Index
1 Year 30.17%
From Inception Date of Institutional Shares 23.42%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 28.47%
From Inception 32.95%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
JANUS ASPEN GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 92.0%
- --------------------------------------------------------------------------------
Advertising Sales - 0.1%
31,030 Outdoor Systems, Inc.* $ 868,840
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 2.5%
379,025 Monsanto Co. 21,178,022
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 2.1%
253,275 Federal-Mogul Corp. 17,096,062
- --------------------------------------------------------------------------------
Cable Television - 9.8%
686,325 Comcast Corp. - Special Class A 27,860,505
159,070 Cox Communications, Inc. - Class A* 7,704,953
551,375 MediaOne Group, Inc.* 24,226,039
554,245 Tele-Communications, Inc. - Class A* 21,303,792
- --------------------------------------------------------------------------------
81,095,289
- --------------------------------------------------------------------------------
Chemicals - Diversified - 4.2%
310,080 E.I. du Pont de Nemours and Co. 23,139,720
100,000 Imperial Chemical Industries PLC (ADR) 6,450,000
178,210 Solutia, Inc. 5,112,399
- --------------------------------------------------------------------------------
34,702,119
- --------------------------------------------------------------------------------
Chemicals - Specialty - 0.6%
104,825 Cytec Industries, Inc.* 4,638,506
- --------------------------------------------------------------------------------
Circuits - 1.9%
10,775 Analog Devices, Inc.* 264,661
250,700 Linear Technology Corp. 15,120,344
- --------------------------------------------------------------------------------
15,385,005
- --------------------------------------------------------------------------------
Commercial Banks - 2.0%
9,475 M & T Bank Corp. 5,249,150
107,805 Northern Trust Corp. 8,220,131
54,550 Star Banc Corp. 3,484,381
- --------------------------------------------------------------------------------
16,953,662
- --------------------------------------------------------------------------------
Commercial Services - 1.6%
382,055 Gartner Group, Inc. - Class A* 13,371,925
- --------------------------------------------------------------------------------
Computer Software - 10.5%
522,050 Cadence Design Systems, Inc.* 16,314,063
396,850 Microsoft Corp.* 43,008,619
782,405 Parametric Technology Co.* 21,222,736
170,000 Wind River Systems* 6,098,750
- --------------------------------------------------------------------------------
86,644,168
- --------------------------------------------------------------------------------
Computers - Micro - 1.2%
106,570 Dell Computer Corp.* $ 9,891,028
- --------------------------------------------------------------------------------
Cruise Lines - 1.3%
154,050 Carnival Corp. - Class A 6,104,231
60,375 Royal Caribbean Cruises, Ltd. 4,799,813
- --------------------------------------------------------------------------------
10,904,044
- --------------------------------------------------------------------------------
Diversified Financial Services - 1.1%
119,425 Associates First Capital Corp. - Class A 9,180,797
- --------------------------------------------------------------------------------
Diversified Operations - 6.9%
623,550 CBS Corp.* 19,797,713
111,100 General Electric Co. 10,110,100
283,890 Siebe PLC** 5,669,835
345,650 Tyco International, Ltd. 21,775,950
- --------------------------------------------------------------------------------
57,353,598
- --------------------------------------------------------------------------------
Drug Delivery Systems - 0.5%
100,000 ALZA Corp.* 4,325,000
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 3.7%
290,830 Applied Materials, Inc.* 8,579,485
466,700 Maxim Integrated Products, Inc.* 14,788,556
119,950 Texas Instruments, Inc. 6,994,584
- --------------------------------------------------------------------------------
30,362,625
- --------------------------------------------------------------------------------
Electronic Safety Devices - 0.6%
70,675 Pittway Corp. - Class A 5,221,116
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 1.8%
293,745 Household International, Inc. 14,613,814
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 3.2%
337,537 Charles Schwab Corp. 10,969,953
171,485 Morgan Stanley, Dean Witter, Discover and Co. 15,669,442
- --------------------------------------------------------------------------------
26,639,395
- --------------------------------------------------------------------------------
Finance - Other Services - 2.2%
200,000 Newcourt Credit Group, Inc. 9,547,500
174,709 Newcourt Credit Group, Inc. - New York Shares 8,593,499
- --------------------------------------------------------------------------------
18,140,999
- --------------------------------------------------------------------------------
Food - Wholesale - 0.4%
98,725 U.S. Foodservice, Inc.* 3,461,545
- --------------------------------------------------------------------------------
Human Resources - 1.0%
146,950 Robert Half International, Inc.* 8,210,831
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 2
<PAGE>
JANUS ASPEN GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Instruments - Scientific - 0.9%
268,450 Dionex Corp.* $ 7,080,369
- --------------------------------------------------------------------------------
Internet Software - 1.2%
90,200 America Online, Inc.* 9,561,200
- --------------------------------------------------------------------------------
Life and Health Insurance - 0.4%
4,250 Schweizerische Lebensversicherungs-und
Rentenanstalt* 3,597,680
- --------------------------------------------------------------------------------
Medical - Drugs - 6.0%
116,665 American Home Products Corp. 6,037,414
10,310 Eli Lilly and Co. 681,104
150,150 Pfizer, Inc. 16,319,428
67,175 Schering-Plough Corp. 6,154,909
294,600 Warner-Lambert Co. 20,437,875
- --------------------------------------------------------------------------------
49,630,730
- --------------------------------------------------------------------------------
Medical Instruments - 0%
7,690 U.S. Surgical Corp. 350,856
- --------------------------------------------------------------------------------
Money Center Banks - 5.2%
333,525 Bank of New York Co., Inc. 20,240,798
112,700 BankAmerica Corp. 9,741,506
30,415 Citicorp 4,539,439
65,026 Lloyds TSB Group PLC** 912,993
21,410 UBS A.G. 7,960,939
- --------------------------------------------------------------------------------
43,395,675
- --------------------------------------------------------------------------------
Multimedia - 4.9%
263,860 Meredith Corp. 12,384,929
327,238 Time Warner, Inc. 27,958,397
- --------------------------------------------------------------------------------
40,343,326
- --------------------------------------------------------------------------------
Networking Products - 5.0%
453,225 Cisco Systems, Inc.* 41,725,027
- --------------------------------------------------------------------------------
Pharmacy Services - 1.1%
229,890 Omnicare, Inc. 8,764,556
- --------------------------------------------------------------------------------
Publishing - Books - 2.2%
134,813 Wolters Kluwer N.V.** 18,503,285
- --------------------------------------------------------------------------------
Radio - 1.2%
200,000 Chancellor Media Corp.* 9,931,250
- --------------------------------------------------------------------------------
Retail - Discount - 1.3%
169,625 Costco Companies, Inc.* 10,696,977
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 0.2%
39,875 Fred Meyer, Inc.* 1,694,687
- --------------------------------------------------------------------------------
Telecommunication Services - 0.2%
100,000 Hyperion Telecommunications, Inc. - Class A* 1,568,750
- --------------------------------------------------------------------------------
Telephone - Long Distance - 2.0%
200,000 AT&T Corp. 11,425,000
112,860 WorldCom, Inc.* 5,466,656
- --------------------------------------------------------------------------------
16,891,656
- --------------------------------------------------------------------------------
Television - 1.0%
226,450 Univision Communications, Inc. - Class A* 8,435,263
- --------------------------------------------------------------------------------
Total Common Stock (cost $581,819,449) 762,409,677
- --------------------------------------------------------------------------------
U.S. Government Agencies - 8.9%
Fannie Mae
$ 30,000,000 5.41%, 8/7/98 29,833,192
Freddie Mac:
19,200,000 5.85%, 7/1/98 19,200,000
25,000,000 5.44%, 7/10/98 24,966,000
- --------------------------------------------------------------------------------
Total U.S. Government Agencies (amortized cost $73,999,192) 73,999,192
- --------------------------------------------------------------------------------
Total Investments (total cost $655,818,641) - 100.9% 836,408,869
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (0.9%) (7,701,326)
- --------------------------------------------------------------------------------
Net Assets - 100% $ 828,707,543
- --------------------------------------------------------------------------------
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Canada 2.2% $ 18,140,999
Netherlands 2.2% 18,503,285
Switzerland 1.4% 11,558,618
United Kingdom 1.6% 13,032,828
United States++ 92.6% 775,173,139
- --------------------------------------------------------------------------------
Total 100.0% $ 836,408,869
================================================================================
++Includes Short-Term Securities (83.8% excluding Short-Term Securities)
Forward Currency Contracts
Open at June 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 9/16/98 5,900,000 $ 9,791,050 ($45,530)
Dutch Guilder 7/23/98 13,000,000 6,387,892 27,267
- --------------------------------------------------------------------------------
Total $16,178,942 ($18,263)
================================================================================
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 3
<PAGE>
JANUS ASPEN AGGRESSIVE GROWTH PORTFOLIO Portfolio Manager, James P. Goff
I'm pleased to report that Janus Aspen Aggressive Growth Portfolio
continued to gain momentum during the six-month period ended June 30, 1998. The
Portfolio returned 17.27% for the Institutional Shares and 16.98% for the
Retirement Shares, compared with the S&P MidCap 400 Index, which gained 8.63%.
All returns include reinvested dividends. The average annual total returns for
the period ended June 30, 1998, follow on the next page.
The Portfolio's turnaround, which began late in 1997 and continued through
the first and second quarters of '98, was the result of remaining true to my
investment discipline. I continued to focus on midsize companies with dominant
market presence and prospects for rapid growth. As the market began to recognize
the true value of many of our companies, the Portfolio steadily gained ground.
Despite our strong performance, investors continued to favor the liquidity
of big, brand-name companies, causing large cap stocks to again outperform the
broad mid cap universe. But as financial difficulties in Asia lingered,
corporate earnings for many larger, multinational companies began to slow.
However, I focus on companies that are relatively insulated from macroeconomic
events and believe the market will continue to realize the value of our small
and mid cap companies.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Equities 97.6% 97.0%
Foreign 10.9% 13.6%
Number of Stocks 57 68
Top 10 Equities 41.4% 41.5%
Cash & Cash Equivalents 2.4% 3.0%
- --------------------------------------------------------------------------------
Increased Focus on Technology, Drug Stocks
The only major change to the Portfolio was an increase in our technology
weighting, which remains underweighted relative to its benchmark. I began to
selectively build these positions during the sell-off late in 1997 and further
increased them when technology stocks dropped again in the second quarter of
'98. My strategy was to uncover companies that have low risk relative to their
growth rate. This paid off in the form of stellar results from America Online,
Vitesse Semiconductor, and Cadence Design Systems.
An enhanced research effort allowed us to increase our focus on the mid cap
pharmaceutical sector. As a result, we uncovered some new names, including ALZA
Corporation, Medimmune, Inc., and Watson Pharmaceuticals. The product pipelines
of all three show signs of promise; therefore, I look for these stocks to be
solid long-term performers.
Education Evolves as a Theme
A new name and strong performer in the Portfolio was ITT Educational
Services, which offers technology-oriented post-secondary degree programs.
Another solid stock, and a position I significantly increased, was Apollo Group.
This company provides accredited degree programs through its subsidiaries, which
include the University of Phoenix.
Aside from Apollo's strong gains, my optimism for the stock comes from the
increasing demand for graduate degrees among working adults and the fact that
Apollo is uniquely focused on catering to this audience. In addition, the
company is not burdened with many of the costs typically associated with higher
education. It leases its office space, has a revenue-generating online library,
and employs a part-time teaching staff, which relieves it of retirement and
insurance plan expenses. Furthermore, students are required to pay tuition in
advance, generating significant free cash flow for the business. Both Apollo and
ITT are benefiting from a rise in compensation for college graduates versus high
school graduates, essentially giving their students a higher return on their
invested tuition dollar.
Also among the Portfolio's top performers was PizzaExpress, a UK-based
holding. This company has consistently produced industry-leading same-store
sales growth and profit margins. Further boosting the stock was the introduction
of PizzaExpress restaurants into Continental Europe and the launch of a second
concept, Pasta Milano, in the UK. These initiatives have met with early success,
and I anticipate positive results going forward.
Although the overall performance of the Portfolio was strong, there were
some stocks that underperformed. Our media stocks encountered a bad stretch in
April and May before bouncing back late in the second quarter. Clear Channel
Communications, a U.S. broadcasting and billboard company, suffered from a
bidding war (which it won) to acquire Moore Group, a British-based outdoor
advertising company. Chancellor Media, a radio broadcasting corporation,
experienced turbulence as a result of internal conflicts that included the hasty
departure of its CEO. And Heftel Broadcasting, a Spanish language radio
broadcasting company, weakened from concerns regarding the potential emergence
of a new competitor. I remain optimistic about the long-term prospects for all
of these companies and continue to hold our positions.
Future of Small and Mid Caps Looks Good
It's noteworthy that we are seeing a slowdown in the corporate earnings of
large cap companies, even though the economy continues to expand at a robust
pace. This may be a sign of a profound shift in trends. I believe the downturn
in Asia will continue to rein in larger companies' earnings growth. However, our
discipline of focusing on all-weather companies has not only produced some solid
results for the first half, but our returns have picked up dramatically during
the past year - despite a less than favorable backdrop in small and midsize
stocks. Therefore, I remain confident that our companies can continue to log
solid results.
In closing, I'd like to thank you for your investment in Janus Aspen
Aggressive Growth Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 4
<PAGE>
JANUS ASPEN AGGRESSIVE GROWTH PORTFOLIO Portfolio Manager, James P. Goff
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 9/13/93)
1 Year 28.74%
From Inception 21.04%
- --------------------------------------------------------------------------------
S&P MidCap 400 Index
1 Year 27.10%
From Inception Date of Institutional Shares 18.01%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 28.11%
From Inception 40.50%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
JANUS ASPEN AGGRESSIVE GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 97.6%
- --------------------------------------------------------------------------------
Advertising Sales - 3.2%
98,995 HA-LO Industries, Inc.* $ 3,081,219
611,239 Outdoor Systems, Inc.* 17,114,692
- --------------------------------------------------------------------------------
20,195,911
- --------------------------------------------------------------------------------
Advertising Services - 0.3%
44,955 Snyder Communications, Inc.* 1,978,020
- --------------------------------------------------------------------------------
Airlines - 1.1%
199,623 Ryanair Holdings PLC (ADR)* 7,111,569
- --------------------------------------------------------------------------------
Cable Television - 2.2%
166,780 Comcast Corp. - Special Class A 6,770,226
158,960 MediaOne Group, Inc.* 6,984,305
- --------------------------------------------------------------------------------
13,754,531
- --------------------------------------------------------------------------------
Cellular Telecommunications - 0.9%
294,100 Western Wireless Corp. - Class A 5,863,619
- --------------------------------------------------------------------------------
Circuits - 5.1%
264,625 SIPEX Corp.* 5,689,438
849,855 Vitesse Semiconductor Corp.* 26,239,273
- --------------------------------------------------------------------------------
31,928,711
- --------------------------------------------------------------------------------
Commercial Banks - 5.6%
11,565 M & T Bank Corp. 6,407,010
124,235 Northern Trust Corp. 9,472,919
247,615 Star Banc Corp. 15,816,408
45,835 U.S. Trust Corp. 3,494,919
- --------------------------------------------------------------------------------
35,191,256
- --------------------------------------------------------------------------------
Commercial Services - 6.1%
55,400 Gartner Group, Inc. - Class A* 1,939,000
184,766 HealthCare Financial Partners, Inc.* 11,328,465
608,853 Paychex, Inc. 24,772,706
- --------------------------------------------------------------------------------
38,040,171
- --------------------------------------------------------------------------------
Computer Software - 3.5%
564,533 Cadence Design Systems, Inc.* 17,641,656
160,240 Parametric Technology Co.* 4,346,510
- --------------------------------------------------------------------------------
21,988,166
- --------------------------------------------------------------------------------
Cruise Lines - 1.3%
99,100 Royal Caribbean Cruises, Ltd. 7,878,450
- --------------------------------------------------------------------------------
Diversified Financial Services - 0.5%
132,310 American Capital Strategies, Ltd. $ 3,026,591
- --------------------------------------------------------------------------------
Diversified Operations - 0.5%
246,130 Metromedia International Group, Inc.* 2,938,177
- --------------------------------------------------------------------------------
Drug Delivery Systems - 0.9%
127,375 ALZA Corp.* 5,508,969
- --------------------------------------------------------------------------------
Electric - Generation - 1.9%
229,190 AES Corp.* 12,046,799
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 1.3%
251,755 Maxim Integrated Products, Inc.* 7,977,487
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 1.0%
228,550 Medallion Financial Corp. 6,285,125
- --------------------------------------------------------------------------------
Finance - Credit Card - 0.7%
32,100 Capital One Financial Corp. 3,986,419
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 1.0%
192,460 Charles Schwab Corp. 6,254,950
- --------------------------------------------------------------------------------
Finance - Mortgage Loan Banker - 0.6%
352,375 Capital Trust - Class A* 3,391,609
- --------------------------------------------------------------------------------
Finance - Other Services - 0.5%
64,835 Newcourt Credit Group, Inc. - New York Shares 3,189,072
- --------------------------------------------------------------------------------
Golf - 0.5%
113,887 Family Golf Centers, Inc.* 2,882,765
- --------------------------------------------------------------------------------
Human Resources - 2.2%
1,211,682 Capita Group PLC** 10,421,819
54,445 Robert Half International, Inc.* 3,042,114
- --------------------------------------------------------------------------------
13,463,933
- --------------------------------------------------------------------------------
Internet Content - 0.5%
65,015 At Home Corp. - Class A* 3,076,022
- --------------------------------------------------------------------------------
Internet Software - 3.0%
175,285 America Online, Inc.* 18,580,210
- --------------------------------------------------------------------------------
Medical - Biomedical and Genetic - 0.4%
66,095 Incyte Pharmaceuticals, Inc.* 2,255,492
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 5
<PAGE>
JANUS ASPEN AGGRESSIVE GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Medical - Drugs - 2.4%
219,105 MedImmune, Inc.* $ 13,666,674
33,410 Sepracor, Inc.* 1,386,515
- --------------------------------------------------------------------------------
15,053,189
- --------------------------------------------------------------------------------
Medical - Generic Drugs - 1.0%
127,470 Watson Pharmaceuticals, Inc.* 5,951,256
- --------------------------------------------------------------------------------
Medical Instruments - 3.9%
50,375 Cyberonics, Inc. 535,234
274,115 Sofamor Danek Group, Inc.* 23,728,080
- --------------------------------------------------------------------------------
24,263,314
- --------------------------------------------------------------------------------
Music/Clubs - 1.8%
249,858 SFX Entertainment, Inc. - Class A* 11,462,236
- --------------------------------------------------------------------------------
Pharmacy Services - 4.6%
746,155 Omnicare, Inc. 28,447,159
- --------------------------------------------------------------------------------
Property and Casualty Insurance - 3.7%
165,520 Progressive Corp. 23,338,320
- --------------------------------------------------------------------------------
Radio - 13.4%
435,725 Capstar Broadcasting Corp. - Class A 10,947,591
487,675 Chancellor Media Corp.* 24,216,112
115,265 Clear Channel Communications, Inc.* 12,578,293
598,300 Heftel Broadcasting Corp. - Class A* 26,773,925
156,890 Jacor Communications, Inc.* 9,256,510
- --------------------------------------------------------------------------------
83,772,431
- --------------------------------------------------------------------------------
Resorts and Theme Parks - 1.7%
159,575 Premier Parks, Inc.* 10,631,684
- --------------------------------------------------------------------------------
Retail - Building Products - 1.0%
127,782 Fastenal Co. 5,933,877
- --------------------------------------------------------------------------------
Retail - Catalog Shopping - 1.2%
260,832 MSC Industrial Direct Co., Inc. - Class A* 7,433,712
- --------------------------------------------------------------------------------
Retail - Drug Store - 0.4%
70,495 CVS Corp. 2,744,899
- --------------------------------------------------------------------------------
Retail - Pubs - 3.4%
4,463,748 J.D. Wetherspoon PLC** 21,486,802
- --------------------------------------------------------------------------------
Retail - Restaurants - 4.1%
1,807,589 PizzaExpress PLC** 25,756,318
- --------------------------------------------------------------------------------
Schools - 7.9%
1,026,156 Apollo Group, Inc. - Class A* 33,927,283
485,565 ITT Educational Services, Inc.* 15,659,471
- --------------------------------------------------------------------------------
49,586,754
- --------------------------------------------------------------------------------
Television - 2.3%
389,873 Univision Communications, Inc. - Class A* 14,522,769
- -------------------------------------------------------------------------------
Total Common Stock (cost $445,990,980) 609,178,744
- --------------------------------------------------------------------------------
U.S. Government Agencies - 4.3%
Fannie Mae
$ 15,000,000 5.41%, 8/7/98 14,916,596
Freddie Mac
12,200,000 5.85%, 7/1/98 12,200,000
- --------------------------------------------------------------------------------
Total U.S. Government Agencies (amortized cost $27,116,596) 27,116,596
- --------------------------------------------------------------------------------
Total Investments (total cost $473,107,576) - 101.9% 636,295,340
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (1.9%) (11,846,200)
- --------------------------------------------------------------------------------
Net Assets - 100% $ 624,449,140
- --------------------------------------------------------------------------------
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Canada 0.5% $ 3,189,072
Ireland 1.1% 7,111,569
United Kingdom 9.1% 57,664,939
United States++ 89.3% 568,329,760
- --------------------------------------------------------------------------------
Total 100.0% $ 636,295,340
================================================================================
++Includes Short-Term Securities (85.1% excluding Short-Term Securities)
Forward Currency Contracts
Open at June 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 7/10/98 5,208,000 $ 8,677,049 ($216,335)
British Pound 8/13/98 1,015,000 1,687,640 (47,401)
British Pound 8/14/98 2,800,000 4,655,560 (82,040)
British Pound 10/7/98 9,600,000 15,912,000 4,800
British Pound 11/4/98 5,500,000 9,101,400 (64,900)
- --------------------------------------------------------------------------------
Total $40,033,649 ($405,876)
================================================================================
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 6
<PAGE>
JANUS ASPEN CAPITAL APPRECIATION PORTFOLIO Portfolio Manager, Scott W. Schoelzel
Janus Aspen Capital Appreciation Portfolio returned an impressive 31.08%
for its Institutional Shares and 30.82% for its Retirement Shares during the six
months ended June 30, 1998. In comparison, the S&P 500 Index gained 17.72%. All
returns include reinvested dividends. The average annual total returns for the
period ended June 30, 1998, follow on the next page.
Low interest rates and benign inflation provided a positive backdrop for
the Portfolio, particularly during the first three months of the period.
However, in the second quarter, volatility increased as renewed financial
turmoil in Asia and perceptions of the Federal Reserve Board's bias toward
raising interest rates came into play. Nonetheless, the solid fundamentals on
which I base my investment selections, including strong management, product
development, and expanding market share, helped our stocks prevail. With these
fundamentals intact and barring any sudden change in the interest rate and
inflationary environments, I believe these companies should continue to prosper
despite market volatility.
Barbell Strategy Adds Balance
The Portfolio's "barbell" strategy continued to work well. Typically, I
start with larger companies that have demonstrated more predictable earnings,
mature management, and distribution systems, such as Microsoft, Gillette, and
Pfizer. Then I balance these ideas by selectively adding emerging growth leaders
- - smaller, more aggressive companies in the earlier stages of development - like
At Home, a network management company and cable Internet service provider, and
Chancellor Media, a growing media and radio conglomerate. But no matter what
their size, all of the Portfolio's companies share several distinct
characteristics: dynamic growth prospects, uniquely positioned product lines,
and competitive positions in their industries.
Top Performers in Sync With Trends
Our substantial weightings in the pharmaceutical, financial, and technology
sectors - areas I believe offer the most dynamic prospects for growth -
continued to drive the Portfolio's performance. The reason for this is simple:
These industries' products and services stand to benefit from broad-based
demographic and economic trends in the U.S. and abroad. Currently, the
pharmaceutical industry epitomizes the strength of these trends. By embracing
new technology, a much-expanded product pipeline is effectively created that
will treat a host of ailments. Combine this with an aging population and
burgeoning acceptance of drug therapies, and many industry leaders are well
positioned to increase revenue and gain further market share. Capturing the
limelight during the first half were Warner-Lambert and Pfizer for their
successful introduction of new products, which helped the companies post gains
of more than 45%.
Among our strongest-performing financial stocks was BankAmerica, which
recently announced its plans to merge with NationsBank, creating the second
largest banking franchise in the U.S. A visit with BankAmerica's CEO shortly
after the announcement fueled my optimism about this union and confirmed that
both of these companies are very much in line with where I believe the future of
banking is heading - toward electronic and online banking. I also feel their
demographic and geographic footprints complement each other. For example, the
offices of the combined banks will extend virtually coast to coast, and their
services will meet the needs of a larger client base, from individuals to
businesses large and small.
Despite some weakness in the technology sector caused primarily by the
reemergence of Asian concerns and several negative earnings preannouncements,
our technology holdings held up very well and even rallied toward the end of the
period. Recording significant gains were Microsoft, America Online, and Dell
Computer.
In regard to Microsoft specifically, we continue to monitor the
government's antitrust suit against the software giant. A meeting with
Microsoft's attorneys to discuss their view of the situation left us feeling
confident the company has a strong case based on legal precedent. Our confidence
was further boosted upon a U.S. Appeals Court's recent decision to support the
company's integration of its Internet browser on its Windows 95 operating
system.
Market volatility caused many investors to turn toward the safety of
larger, more established companies, resulting in a downturn for some of our
small, high P/E stocks. CBT Group, a company that provides interactive education
software for businesses, and Level 3 Communications, a telecommunications and
information services company, were among those that suffered what I believe to
be temporary setbacks. Yet, because the fundamentals of these companies remain
strong, I'm optimistic about their long-term prospects and continue to hold on
to the positions.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Equities 86.8% 81.0%
Foreign 8.6% 7.2%
Top 10 Equities 41.2% 42.4%
Number of Stocks 35 33
Cash & Cash Equivalents 13.2% 19.0%
- --------------------------------------------------------------------------------
Continue to Uncover Great Ideas
My outlook for the U.S. and global economies is positive. I believe the
persistence of financial instability in Asia will keep interest rates in check
and inflation under control. At the same time, heightened problems in the Far
East have increased fears about earnings pressure for companies with Asian
exposure. Many of our companies, however, have proven resilient to this pressure
because of their strengths in other geographies. For them, the Asian crisis may
actually prove to be an opportunity to gain market share in weaker economies. As
in the past, we'll continue to look for such companies - those whose business
fundamentals transcend the vagaries of the marketplace.
Thank you for your continued investment in Janus Aspen Capital Appreciation
Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 7
<PAGE>
JANUS ASPEN CAPITAL APPRECIATION PORTFOLIO Portfolio Manager, Scott W. Schoelzel
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 5/1/97)
1 Year 41.24%
From Inception 54.37%
- --------------------------------------------------------------------------------
S&P 500 Index
1 Year 30.17%
From Inception Date of Institutional Shares 36.91%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 40.63%
From Inception 53.69%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
JANUS ASPEN CAPITAL APPRECIATION PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 86.8%
- --------------------------------------------------------------------------------
Applications Software - 0.6%
2,300 Intuit, Inc.* $ 140,875
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 2.4%
9,725 Ford Motor Co. 573,775
- --------------------------------------------------------------------------------
Cable Television - 2.4%
15,270 Tele-Communications, Inc. - Class A* 586,941
- --------------------------------------------------------------------------------
Computer Software - 4.9%
10,900 Microsoft Corp.* 1,181,287
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 2.4%
11,640 Saville Systems Ireland PLC (ADR)* 583,455
- --------------------------------------------------------------------------------
Computers - Memory Devices - 4.4%
25,762 VERITAS Software Corp.* 1,065,903
- --------------------------------------------------------------------------------
Computers - Micro - 2.3%
5,863 Dell Computer Corp.* 544,160
- --------------------------------------------------------------------------------
Cosmetics and Toiletries - 3.8%
15,950 Gillette Co. 904,166
- --------------------------------------------------------------------------------
Data Processing and Management - 2.1%
7,730 LHS Group, Inc.* 509,214
- --------------------------------------------------------------------------------
Diversified Operations - 1.9%
9,880 CBS Corp. 313,690
1,430 General Electric Co. 130,130
- --------------------------------------------------------------------------------
443,820
- --------------------------------------------------------------------------------
Educational Software - 2.5%
11,270 CBT Group PLC (ADR)* 602,945
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 2.6%
10,690 Texas Instruments, Inc. 623,361
- --------------------------------------------------------------------------------
Finance - Credit Card - 4.0%
8,390 American Express Co. 956,460
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 5.4%
3,375 Merrill Lynch & Co., Inc. 311,344
10,945 Morgan Stanley, Dean Witter, Discover and Co. 1,000,099
- --------------------------------------------------------------------------------
1,311,443
- --------------------------------------------------------------------------------
Finance - Other Services - 1.6%
8,055 Newcourt Credit Group, Inc. - New York Shares $ 396,205
- --------------------------------------------------------------------------------
Internet Content - 2.8%
14,205 At Home Corp. - Class A* 672,074
- --------------------------------------------------------------------------------
Internet Software - 9.6%
15,285 America Online, Inc.* 1,620,210
15,240 Exodus Communications, Inc.* 681,990
- --------------------------------------------------------------------------------
2,302,200
- --------------------------------------------------------------------------------
Medical - Biomedical and Genetic - 1.0%
7,065 Incyte Pharmaceuticals, Inc.* 241,093
- --------------------------------------------------------------------------------
Medical - Drugs - 6.9%
8,965 Eli Lilly and Co. 592,250
7,519 Pfizer, Inc. 817,221
3,504 Warner-Lambert Co. 243,090
- --------------------------------------------------------------------------------
1,652,561
- --------------------------------------------------------------------------------
Money Center Banks - 4.4%
10,720 BankAmerica Corp. 926,610
948 Citicorp 141,489
- --------------------------------------------------------------------------------
1,068,099
- --------------------------------------------------------------------------------
Multi-line Insurance - 1.8%
2,920 American International Group, Inc. 426,320
- --------------------------------------------------------------------------------
Multimedia - 0.8%
2,325 Time Warner, Inc. 198,642
- --------------------------------------------------------------------------------
Networking Products - 3.0%
7,865 Cisco Systems, Inc.* 724,072
- --------------------------------------------------------------------------------
Radio - 2.1%
10,210 Chancellor Media Corp.* 506,990
- --------------------------------------------------------------------------------
Retail - Building Products - 2.7%
7,880 Home Depot, Inc. 654,532
- --------------------------------------------------------------------------------
Super - Regional Banks - 3.0%
16,905 U.S. Bancorp 726,915
- --------------------------------------------------------------------------------
Telecommunication Equipment - 2.0%
8,455 Northern Telecom, Ltd. 479,821
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 8
<PAGE>
JANUS ASPEN CAPITAL APPRECIATION PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Telecommunication Services - 3.4%
8,060 Level 3 Communications, Inc.* $ 596,440
6,035 Qwest Communications International, Inc.* 210,471
- --------------------------------------------------------------------------------
806,911
- --------------------------------------------------------------------------------
Total Common Stock (cost $16,418,156) 20,884,240
- --------------------------------------------------------------------------------
U.S. Government Agency - 8.7%
Freddie Mac
$ 2,100,000 5.85%, 7/1/98 (amortized cost $2,100,000) 2,100,000
- --------------------------------------------------------------------------------
Total Investments (total cost $18,518,156) - 95.5% 22,984,240
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 4.5% 1,080,137
- --------------------------------------------------------------------------------
Net Assets - 100% $ 24,064,377
- --------------------------------------------------------------------------------
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Canada 3.8% $ 876,027
Ireland 5.2% 1,186,400
United States++ 91.0% 20,921,813
- --------------------------------------------------------------------------------
Total 100.0% $ 22,984,240
================================================================================
++Includes Short-Term Securities (81.9% excluding Short-Term Securities)
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 9
<PAGE>
JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO Portfolio Manager, Helen Young Hayes
During the six-month period ended June 30, 1998, Janus Aspen International
Growth Portfolio returned 22.22% for its Institutional Shares and 21.89% for its
Retirement Shares versus a 15.93% gain for the Morgan Stanley International EAFE
Index. All returns include reinvested dividends. The average annual total
returns for the period ended June 30, 1998, follow on the next page.
Before discussing our performance in greater detail, I would like to
announce a very positive development regarding management of the Portfolio - the
promotion of Laurence Chang from assistant portfolio manager to co-manager. I am
pleased to see my colleague of five years take on this additional
responsibility, and believe it is in the best long-term interest for the
Portfolio's continued success.
Asia Struggles as Europe Excels
The Portfolio's solid performance was particularly impressive given the
volatility of the foreign markets during the first half. The continued decline
of Asian economies, underscored by the breakdown of the yen and Japan's first
official recession in 20 years, was very much in line with our expectations.
However, because our exposure to Asia was limited, its impact on the Portfolio's
performance was minimal.
Our focus on European stocks, which comprised approximately 80% of the
Portfolio, drove our impressive gains. Economic growth in Europe continues to be
aided by the pending European Monetary Union (EMU), as well as a move on the
part of a growing number of individual companies toward the corporate reforms,
such as restructuring, that have so well served American businesses.
Latin America was somewhat bruised by emerging market fears, particularly
those regarding renewed turmoil in Asia. A general increase in the risk premium
of emerging market stocks caused Latin American markets to suffer. However,
economic reform in the region continues, and we remain optimistic about
high-quality franchise names, such as Groupo Televisa and Telebras.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Equities 93.8% 91.6%
Foreign 92.6% 90.1%
Number of Stocks 201 188
Top 10 Equities 17.4% 22.9%
Cash & Fixed-Income Securities 6.2% 8.4%
- --------------------------------------------------------------------------------
Top Performers Embrace Trends
Our longtime holding in Philips Electronics, a Netherlands-based
manufacturer of semiconductors and consumer electronics, was a standout during
the period. The company's cost-cutting plans appear to be well ahead of
expectations. Additionally, its embracing of global economic trends, such as the
enhancement of shareholder value and the rapid restructuring of its business
portfolio, helped boost returns. Most recently, Philips announced the sale of
PolyGram, its entertainment unit - a clear sign of the company's commitment to
spin off its non-core divisions.
The Portfolio's telecommunications holdings also did well, with exceptional
results from our telecommunications equipment manufacturers, including Nokia and
Ericsson, as well as Mannesmann, a German industrial and telecommunications
service provider recently added to the Portfolio. These companies are benefiting
from deregulation and increased demand for second lines because of Internet and
data traffic. We anticipate increased investment opportunities to evolve as new
entrants take on the industry's European monopoly operators. And in terms of
growth, we view the most exciting markets as Italy and Scandinavia.
We also benefited from our exposure to pharmaceutical stocks. Our
enthusiasm for drug companies was fueled by the continued shortening of product
development times and consolidation within the industry. An increase in drug
pipelines also helped accelerate the earnings of several pharmaceutical
companies, particularly in Europe. This included Irish-based Elan, a position we
significantly increased during the half, and Schering, a German pharmaceutical
company recently added to the Portfolio.
Although the Portfolio performed well overall, the first half was not
without its disappointments. Powerscreen, a manufacturer of equipment for the
mining, construction, and waste disposal industries, reported weak earnings
because of accounting issues at one of its primary subsidiaries. As a result, we
elected to sell this stock at a loss.
Global Outlook Good Despite Volatility
Uncertainties about Asian currency devaluations, global macroeconomic
trends, and excessive economic growth in the U.S. have contributed to the recent
nervousness in the markets. While we believe volatility is likely to continue,
our outlook for global markets is cautiously optimistic. The resurgence of
financial turbulence in Asia and a sharp decrease in commodity prices have
helped reduce global inflationary pressures, which should support a positive
interest rate environment going forward. In addition, as Europe continues to
move toward government deregulation, corporate restructuring, and industry
consolidation, we look for earnings growth, as well as stock prices, among
European companies to accelerate.
Thank you for your continued investment in Janus Aspen International Growth
Portfolio.
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 10
<PAGE>
JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO Portfolio Manager, Helen Young Hayes
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 5/2/94)
1 Year 22.42%
From Inception 22.58%
- --------------------------------------------------------------------------------
Morgan Stanley Capital International EAFE Index(2)
1 Year 6.10%
From Inception Date of Institutional Shares 8.23%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 21.82%
From Inception 29.10%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
(2) Net dividends reinvested are the dividends that remain to be reinvested
after foreign tax obligations have been met. Such obligations vary from
country to country. EAFE stands for Europe, Australasia, and the Far East.
Neither the U.S. market nor the emerging markets of Latin America and
Eastern Europe are represented in EAFE.
JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 90.9%
- --------------------------------------------------------------------------------
Airlines - 0.6%
25,617 Deutsche Lufthansa A.G.** $ 645,025
14,454 SAS Danmark A/S 290,046
14,254 SAS Norge A.S.A. - Class B 243,339
19,873 SAS Sverige A.B.** 356,346
- --------------------------------------------------------------------------------
1,534,756
- --------------------------------------------------------------------------------
Appliances - 1.3%
195,770 Electolux A.B. - Series B** 3,363,093
- --------------------------------------------------------------------------------
Audio and Video Products - 1.6%
49,000 Sony Corp.** 4,219,113
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 2.4%
860 Bayerische Motoren Werke (BMW) A.G.** 869,512
258 Bayerische Motoren Werke (BMW) A.G. - New** 257,281
36,000 Honda Motor Co., Ltd.** 1,281,401
52,007 Renault S.A.** 2,958,174
920 Volkswagen A.G.** 888,382
- --------------------------------------------------------------------------------
6,254,750
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 0.3%
6,602 Valeo S.A.** 674,829
- --------------------------------------------------------------------------------
Beverages - Non-Alcoholic - 0.1%
13,650 Coca-Cola Femsa S.A. (ADR) 237,169
- --------------------------------------------------------------------------------
Beverages - Wine and Spirits - 0.8%
179,618 Diageo PLC** 2,132,313
- --------------------------------------------------------------------------------
Brewery - 1.0%
40,465 Companhia Cervejaria Brahma (ADR) 505,813
24,060 Fomento Economico Mexicano, S.A. de C.V. 749,697
146,000 Kirin Brewery Co., Ltd.** 1,378,100
- --------------------------------------------------------------------------------
2,633,610
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 1.8%
82,980 Grupo Televisa S.A. (GDR)* 3,122,123
104,666 Modern Times Group A.B.** 1,345,246
- --------------------------------------------------------------------------------
4,467,369
- --------------------------------------------------------------------------------
Building - Heavy Construction - 0.2%
5,229 Compagnie Francaise d'Etudes et
de Construction Technip** 639,135
- --------------------------------------------------------------------------------
Building Products - Cement and Aggregate - 0.3%
20,336 Cimpor-Cimentos de Portugal, S.A. $ 714,490
- --------------------------------------------------------------------------------
Cellular Telecommunications - 2.9%
10,597 Cellular Communications International, Inc.* 528,525
788,000 China Telecom, Ltd.*,+ 1,367,813
12,858 Millicom International Cellular S.A.* 562,538
2,643 Telecel-Comunicacaoes Pessoais S.A. 469,307
472,870 Telecom Italia Mobile S.p.A. 2,885,290
227,218 Telecom Italia S.p.A. 1,660,083
- --------------------------------------------------------------------------------
7,473,556
- --------------------------------------------------------------------------------
Chemicals - Diversified - 3.2%
19,022 Akzo Nobel N.V.** 4,228,520
12,167 BASF A.G.** 578,006
26,513 Hoechst A.G.** 1,332,969
71,986 Imperial Chemical Industries PLC** 1,155,445
830,000 SNIA BPD S.p.A.+ 1,014,182
- --------------------------------------------------------------------------------
8,309,122
- --------------------------------------------------------------------------------
Chemicals - Specialty - 0.4%
41,000 Rhodia S.A.** 1,143,329
- --------------------------------------------------------------------------------
Closed-End Funds - 0.1%
163 Romania Investment Fund+ 167,872
- --------------------------------------------------------------------------------
Commercial Banks - 2.0%
18,522 Banco Central Hispanoamericano 583,160
4,575 BG Bank A/S 283,354
40,500 Corporacion Bancaria de Espana S.A. 910,053
7,819 Credit Commercial de France** 658,262
64,894 Credito Italiano S.p.A. 337,293
52,022 Den norske Bank A.S.A. 272,532
6,793 Erste Bank Der Oesterreichischen
Sparkassen A.G.+ 411,891
101,951 Merita PLC - Class A 672,676
16,369 National Australia Bank, Ltd. 215,906
10,995 Royal Bank of Canada 666,186
2,500 Uniao de Bancos Brasileiros S.A. (GDR) 73,750
- --------------------------------------------------------------------------------
5,085,063
- --------------------------------------------------------------------------------
Commercial Services - 0.1%
10,190 ICON PLC (ADR) 257,298
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 11
<PAGE>
JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Computer Services - 4.8%
5,390 Atos S.A.*,** $ 1,292,667
21,921 Cap Gemini S.A.** 3,444,401
4,380 ECsoft Group PLC (ADR) 141,803
19,636 Electronisk Databehandling A.S.A. 75,488
53,317 Getronics N.V.** 2,765,157
79,550 Logica PLC** 2,578,264
32,373 Misys PLC** 1,839,189
4,060 WM-Data A.B. - Class B** 141,019
- --------------------------------------------------------------------------------
12,277,988
- --------------------------------------------------------------------------------
Computer Software - 2.1%
4,633 Cap Gemini N.V.** 382,625
19,844 JBA Holdings PLC** 205,280
38,000 Meitec** 1,314,260
30,535 Merkantildata A.S.A. 385,988
31 NTT Data Corp.** 1,119,069
24,717 Tieto Corp. - Class B 1,878,615
- --------------------------------------------------------------------------------
5,285,837
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 1.7%
26,125 Saville Systems Ireland PLC (ADR) 1,309,516
262,008 SEMA Group PLC** 3,104,367
- --------------------------------------------------------------------------------
4,413,883
- --------------------------------------------------------------------------------
Consulting Services - 0.1%
4,319 Mandator A.B.** 168,970
- --------------------------------------------------------------------------------
Consumer Products - 0.3%
15,130 Hagemeyer N.V.** 654,521
- --------------------------------------------------------------------------------
Cosmetics and Toiletries - 0.5%
86,000 Kao Corp.** 1,326,071
- --------------------------------------------------------------------------------
Cruise Lines - 0.8%
437,808 NCL Holdings A.S.A. 2,162,356
- --------------------------------------------------------------------------------
Diversified Operations - 6.8%
892,480 First Pacific Co., Ltd. 374,335
157,979 General Electric Co. PLC** 1,361,432
45,444 Hays PLC** 762,024
3,849 Lagardere S.C.A.** 160,236
50,549 Ordina N.V.** 1,637,576
4,479 Ratin A/S - B Shares 947,642
695,991 Rentokil Initial PLC** 5,005,035
193,468 Siebe PLC** 3,863,932
13,821 Siemens A.G.** 843,410
38,739 Smiths Industries PLC** 540,999
69 Sulzer A.G.** 54,452
12,257 Tomkins PLC** 66,516
5,942 Vivendi** 1,268,787
67,860 Williams PLC** 437,045
- --------------------------------------------------------------------------------
17,323,421
- --------------------------------------------------------------------------------
Drug Delivery Systems - 0.9%
34,377 Elan Corp. PLC (ADR)* 2,210,871
- --------------------------------------------------------------------------------
Educational Software - 0.6%
28,250 CBT Group PLC (ADR) 1,511,375
- --------------------------------------------------------------------------------
Electric - Integrated - 0.6%
4,344 Companhia Energetica de Minas Gerais (ADR) 132,504
102,375 Companhia Paranaense de Energia-Copel (ADR) 946,969
22,474 Endesa S.A. 492,522
7,595 Mosenergo (ADR)+ 36,076
- --------------------------------------------------------------------------------
1,608,071
- --------------------------------------------------------------------------------
Electric Products - 0%
2,941 Samsung Electronics+ 46,688
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Electronic Components - 3.2%
218,991 Electrocomponents PLC** $ 1,717,316
38,547 Philips Electronics N.V.** 3,240,323
37,295 Philips Electronics N.V. - N.Y. Shares** 3,170,075
- --------------------------------------------------------------------------------
8,127,714
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 0.3%
4,620 ASM Lithography Holding N.V. (ADR)* 134,269
7,000 Rohm Co., Ltd.** 716,214
- --------------------------------------------------------------------------------
850,483
- --------------------------------------------------------------------------------
Electronic Measuring Instruments - 0.6%
1,080 Compagnie des Signeaux S.A.** 103,962
6,884 Simac Techniek N.V.** 1,445,008
- --------------------------------------------------------------------------------
1,548,970
- --------------------------------------------------------------------------------
Fiber Optics - 0%
5,190 JDS Fitel, Inc. 86,468
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 0.5%
115,000 Nomura Securities Co., Ltd.** 1,338,177
- --------------------------------------------------------------------------------
Finance - Other Services - 0.9%
42,040 Newcourt Credit Group, Inc. 2,006,885
5,985 Newcourt Credit Group, Inc. - New York Shares 294,387
- --------------------------------------------------------------------------------
2,301,272
- --------------------------------------------------------------------------------
Food - Catering - 0.6%
135,016 Compass Group PLC** 1,554,392
- --------------------------------------------------------------------------------
Food - Dairy Products - 0%
2,245 Koninklijke Numico N.V.** 70,300
- --------------------------------------------------------------------------------
Food - Diversified - 1.6%
9,571 Danone** 2,638,899
76,220 Raisio Group PLC 1,383,675
- --------------------------------------------------------------------------------
4,022,574
- --------------------------------------------------------------------------------
Food - Retail - 0.7%
5,750 Disco S.A. (ADR)* 184,000
39,466 Koninklijke Ahold N.V.** 1,266,887
42,280 Santa Isabel S.A. (ADR) 465,080
- --------------------------------------------------------------------------------
1,915,967
- --------------------------------------------------------------------------------
Human Resources - 1.8%
141,400 Capita Group PLC** 1,216,198
38,249 Select Appointments Holdings PLC** 545,648
92,590 Select Appointments Holdings PLC (ADR)** 2,731,405
- --------------------------------------------------------------------------------
4,493,251
- --------------------------------------------------------------------------------
Investment Management and Advisory Services - 0.4%
104,621 Amvescap PLC** 1,021,177
- --------------------------------------------------------------------------------
Life and Health Insurance - 0.7%
2,076 Schweizerische Lebensversicherungs-
und Rentenanstalt** 1,757,361
- --------------------------------------------------------------------------------
Machinery - General Industrial - 0.9%
23,682 Alstom*,** 779,473
15,780 Mannesmann A.G.** 1,621,681
- --------------------------------------------------------------------------------
2,401,154
- --------------------------------------------------------------------------------
Medical - Biomedical and Genetic - 0.2%
294 Ares-Serono Group - Class B** 408,976
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 12
<PAGE>
JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Medical - Drugs - 6.2%
90,697 Astra A.B. - Class A** $ 1,853,757
18,836 Merck KGaA** 844,213
1,891 NeuroSearch A.S. 146,287
1,336 Novartis A.G.** 2,223,127
3,243 Novo Nordisk A/S - Class B 447,049
11,215 Pharmacia & Upjohn, Inc. 517,292
28,465 Rhone-Poulenc - Class A** 1,605,444
23 Roche Holding A.G.** 225,859
7,449 Sanofi S.A.** 875,986
20,642 Schering A.G.** 2,430,107
35,175 SmithKline Beecham PLC (ADR) 2,128,088
2,252 Synthelabo** 379,925
60,000 Takeda Chemical Industries** 1,595,267
12,756 Zeneca Group PLC** 547,407
- --------------------------------------------------------------------------------
15,819,808
- --------------------------------------------------------------------------------
Medical - Wholesale Drug Distributors - 0%
3,306 Grupo Casa Autrey S.A. de C.V. (ADR) 21,489
- --------------------------------------------------------------------------------
Medical Products - 0.1%
19,473 Ortivus A.B. - B Shares*,** 305,221
- --------------------------------------------------------------------------------
Metal Processors and Fabricators - 0.7%
42,528 Assa Abloy A.B. - Class B** 1,671,801
- --------------------------------------------------------------------------------
Money Center Banks - 9.3%
411,014 Banca Commerciale Italiana 2,460,465
1,527,795 Banca di Roma* 3,088,165
2,534 Banco Bilbao Vizcaya S.A. 130,267
21,874 Bank Austria A.G. 1,779,166
4,720 Credit Suisse Group** 1,050,230
33,250 Deutsche Bank A.G.** 2,811,000
9,346 Dresdner Bank A.G.** 504,830
11,897 ING Groep N.V.** 779,011
237,015 Lloyds TSB Group PLC** 3,327,792
58,778 National Westminster Bank PLC** 1,050,341
28,130 Schroders PLC** 725,614
60,700 Skandinaviska Enskilda Banken - Class A** 1,038,947
50,691 Standard Chartered PLC** 581,380
11,850 UBS A.G.** 4,406,218
- --------------------------------------------------------------------------------
23,733,426
- --------------------------------------------------------------------------------
Mortgage Banks - 0.9%
17,622 Deutsche Pfandbrief-und
Hypothekenbank A.G.** 1,409,733
29,129 Sparebanken 835,127
- --------------------------------------------------------------------------------
2,244,860
- --------------------------------------------------------------------------------
Multi-Line Insurance - 4.0%
1,557 Allianz A.G.** 518,847
45 Allianz A.G. - New** 14,870
54,463 Assicurazioni Generali 1,762,652
290 Baloise Holding, Ltd.** 237,459
7,355 ERGO Versicherungs Gruppe A.G.** 1,320,208
14,154 Pohjola Insurance Group - Class B 701,704
80,213 Royal & Sun Alliance Insurance Group PLC** 829,110
58,869 Sampo Insurance Co., Ltd. - Class A 2,789,754
27,087 Storebrand A.S.A.* 240,035
3,031 Zurich Versicherungs-Gesellschaft** 1,934,327
- --------------------------------------------------------------------------------
10,348,966
- --------------------------------------------------------------------------------
Music/Clubs - 0.1%
3,552 PolyGram N.V.** 181,247
- --------------------------------------------------------------------------------
Office Furnishings - 0.2%
19,404 Koninklijke Ahrend Groep N.V.** 633,375
- --------------------------------------------------------------------------------
Oil Companies - Integrated - 2.3%
22,877 Elf Aquitaine S.A.** $ 3,216,235
1,665 Lukoil Holding (ADR) 54,971
17,013 Total S.A.** 2,211,736
13,400 YPF S.A. (ADR) 402,838
- --------------------------------------------------------------------------------
5,885,780
- --------------------------------------------------------------------------------
Paper and Related Products - 0%
11,500 Kimberly-Clark de Mexico, S.A. de C.V. - Class A 40,632
- --------------------------------------------------------------------------------
Publishing - Books - 2.2%
40,117 Wolters Kluwer N.V.** 5,506,118
- --------------------------------------------------------------------------------
Reinsurance - 0.4%
1,893 Muenchener Rueckversicherungs-
Gesellschaft A.G.** 939,665
- --------------------------------------------------------------------------------
Retail - Building Products - 0.2%
2,620 Castorama Dubois Investisse** 461,076
- --------------------------------------------------------------------------------
Retail - Discount - 0%
36,900 Cifra S.A. de C.V. - Class C 50,919
49,371 Cifra S.A. de C.V. - Class V 74,062
- --------------------------------------------------------------------------------
124,981
- --------------------------------------------------------------------------------
Retail - Diversified - 0.5%
28,000 Ito-Yokado Co., Ltd.** 1,317,430
- --------------------------------------------------------------------------------
Retail - Pubs - 0%
14,635 J.D. Wetherspoon PLC** 70,447
- --------------------------------------------------------------------------------
Retail - Restaurants - 1.0%
233,071 Tele Pizza S.A.* 2,512,033
- --------------------------------------------------------------------------------
Security Services - 2.7%
141,853 Securitas A.B. - Class B** 6,945,952
- --------------------------------------------------------------------------------
Special Purpose Banks - 0.1%
88 Dexia Belgium (Credit Communal)+ 13,244
1,114 Dexia France** 149,982
- --------------------------------------------------------------------------------
163,226
- --------------------------------------------------------------------------------
Telecommunication Equipment - 2.5%
9,316 Alcatel Alsthom** 1,896,779
3,205 Alcatel Alsthom (ADR)** 130,403
33,120 Nokia Oyj - Class A 2,444,844
44,930 Telefonaktiebolaget L.M. Ericsson - Class B** 1,312,697
18,054 Telefonaktiebolaget L.M. Ericsson
(ADR) - Class B** 516,796
- --------------------------------------------------------------------------------
6,301,519
- --------------------------------------------------------------------------------
Telecommunication Services - 2.3%
42,480 Clearnet Communications, Inc. - Class A* 467,280
48,545 COLT Telecom Group PLC** 1,968,235
161,670 Energis PLC*,** 2,461,644
21,700 STET Hellas Telecommunications S.A. (ADR) 900,550
- --------------------------------------------------------------------------------
5,797,709
- --------------------------------------------------------------------------------
Telephone - Integrated - 3.8%
15,980 Companhia de Telecommunicaciones
de Chile S.A. (ADR) 324,594
45,141 Global TeleSystems Group, Inc. 2,200,624
22,857 Hellenic Telecommunication Organization S.A.+ 585,923
368 Nippon Telegraph & Telephone Corp.** 3,049,320
15,700 Nortel Inversora S.A. (ADR) 390,537
17,410 Portugal Telecom S.A. 922,715
8,800 Telecom Argentina Stet S.A. (ADR) 262,350
21,300 Telefonica de Argentina S.A. (ADR) 690,919
18,832 Telefonica de Espana 872,159
11,435 Telefonos de Mexico S.A. (ADR) 549,595
- --------------------------------------------------------------------------------
9,848,736
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 13
<PAGE>
JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Textile - Apparel - 0.2%
5,690 Chargeurs S.A.** $ 470,086
- --------------------------------------------------------------------------------
Tobacco - 0.3%
7,535 Empresas La Moderna S.A. de C.V. (ADR) 178,014
26,004 Tabacalera S.A. - Class A+ 533,365
- --------------------------------------------------------------------------------
711,379
- --------------------------------------------------------------------------------
Travel Services - 0.2%
98 Kuoni Reisen A.G. - Class B** 486,508
- --------------------------------------------------------------------------------
Total Common Stock (cost $187,350,853) 232,738,625
- --------------------------------------------------------------------------------
Preferred Stock - 2.7%
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 1.4%
1,266 Porsche A.G.** 3,647,134
- --------------------------------------------------------------------------------
Insurance Brokers - 0.4%
2,142 Marschollek, Lautenschlaeger
und Partner A.G.** 1,044,279
- --------------------------------------------------------------------------------
Retail - Building Products - 0.2%
7,198 Hornbach Holding A.G.** 657,977
- --------------------------------------------------------------------------------
Telephone - Integrated - 0.7%
15,637 Telecomunicacoes Brasileiras S.A. (ADR) 1,707,365
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $5,800,577) 7,056,755
- --------------------------------------------------------------------------------
Rights - 0.2%
580 Baloise Holding, Ltd.** (cost $0) 474,535
- --------------------------------------------------------------------------------
U.S. Government Obligation - 0.3%
$ 700,000 U.S. Treasury Note 5.075%
due 10/1/98 (cost $691,047) 691,103
- --------------------------------------------------------------------------------
U.S. Government Agency - 9.8%
Freddie Mac
25,000,000 5.85% 7/1/98
(amortized cost $25,000,000) 25,000,000
- --------------------------------------------------------------------------------
Total Investments (total cost $218,842,477) - 103.9% 265,961,018
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (3.9%) (10,072,818)
- --------------------------------------------------------------------------------
Net Assets - 100% $ 255,888,200
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 14
<PAGE>
JANUS ASPEN INTERNATIONAL GROWTH PORTFOLIO June 30, 1998 (unaudited)
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Argentina 0.7% $ 1,930,643
Australia 0.1% 215,906
Austria 0.8% 2,191,057
Belgium 1.3% 3,366,430
Brazil -- 13,243
Canada 1.3% 3,521,205
Chile 0.3% 789,673
Denmark 0.8% 2,114,377
Finland 3.7% 9,871,267
France 10.2% 27,159,805
Germany 8.7% 23,179,127
Greece 0.5% 1,486,472
Hong Kong 0.7% 1,742,147
Ireland 1.9% 5,031,761
Italy 4.9% 13,208,128
Japan 7.0% 18,654,420
Luxembourg 0.2% 562,537
Mexico 1.9% 5,023,697
Netherlands 9.8% 26,095,010
Norway 1.6% 4,214,865
Portugal 0.8% 2,106,511
Romania 0.1% 167,872
Russia -- 91,047
South Korea -- 46,688
Spain 2.3% 6,033,559
Sweden 7.2% 19,019,843
Switzerland 5.0% 13,259,050
United Kingdom 17.3% 45,927,133
United States++ 10.9% 28,937,545
- --------------------------------------------------------------------------------
Total 100.0% $ 265,961,018
================================================================================
++Includes Short-Term Securities (1.5% excluding Short-Term Securities)
Forward Currency Contracts
Open at June 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 7/10/98 500,000 $ 833,050 ($11,550)
British Pound 8/7/98 4,380,000 7,285,254 (165,438)
British Pound 8/13/98 900,000 1,496,430 (42,030)
British Pound 10/7/98 6,220,000 10,309,650 (112,244)
Dutch Guilder 7/17/98 2,000,000 982,367 435
Dutch Guilder 7/23/98 375,000 184,266 (9)
Dutch Guilder 7/31/98 4,625,000 2,273,845 10,429
French Franc 7/23/98 1,043,000 172,371 (174)
French Franc 7/31/98 9,157,000 1,514,129 6,933
French Franc 8/7/98 800,000 132,336 (507)
French Franc 10/21/98 1,500,000 249,198 (95)
German Deutschemark 7/23/98 260,000 144,052 91
German Deutschemark 11/4/98 29,000 16,165 463
German Deutschemark 11/12/98 1,311,000 731,095 2,376
Japanese Yen 7/23/98 200,700,000 1,442,586 168,816
Japanese Yen 8/7/98 92,800,000 667,041 47,658
Japanese Yen 10/7/98 310,000,000 2,228,455 155,912
Japanese Yen 10/21/98 267,000,000 1,919,387 (16,796)
Japanese Yen 11/4/98 129,500,000 930,958 13,761
Swedish Krona 7/17/98 585,000 73,248 24
Swedish Krona 8/7/98 464,000 58,151 (8)
Swedish Krona 10/7/98 20,451,000 2,569,576 28,019
Swiss Franc 7/10/98 36,000 23,722 1,123
Swiss Franc 7/17/98 400,000 263,765 13,243
Swiss Franc 7/23/98 185,000 122,080 6,623
Swiss Franc 7/31/98 600,000 396,275 20,392
Swiss Franc 10/7/98 700,000 465,457 6,878
Swiss Franc 11/4/98 50,000 33,344 1,305
Swiss Franc 12/2/98 2,229,000 1,490,870 18,269
- --------------------------------------------------------------------------------
Total $39,009,123 $ 153,899
================================================================================
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 15
<PAGE>
JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO Portfolio Manager, Helen Young Hayes
Janus Aspen Worldwide Growth Portfolio posted solid gains for the six
months ended June 30, 1998, returning 27.02% for the Institutional Shares and
26.71% for the Retirement Shares. In comparison, the Morgan Stanley
International World Index gained 16.64%. All returns include reinvested
dividends. The average annual total returns for the period ended June 30, 1998,
follow on the next page.
Solid Investments Withstand Volatility
The Portfolio performed well despite heightened global market volatility
caused by economic tension in Asia. Its resilience in the face of this
turbulence illustrated the strength of our individual investments, regardless of
geographic location.
During the first quarter, investors came to view the Asian crisis as
positive for the global economy, helping to keep a cap on inflation and interest
rates. However, market jitters resurfaced in the second quarter when the
Japanese government announced its country had slipped into a recession. A sharp
breakdown in the yen versus the dollar magnified the market's concerns, fanning
apprehension of another round of Asian currency devaluations. As a result,
investors began to question the potential repercussions on corporate earnings,
adding to the volatility in global markets. Fortunately, the effect on the
Portfolio was minimized by our limited exposure to the Pacific Rim.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Equities 96.7% 97.4%
Foreign 73.0% 77.8%
Number of Stocks 196 205
Top 10 Equities 20.1% 21.0%
Cash & Cash Equivalents 3.3% 2.6%
- --------------------------------------------------------------------------------
Portfolio Gains from Thriving European Stocks
We continued to hold a significant portion of our assets in Europe, where a
strong economy supported corporate earnings, thus boosting many of our stocks.
Accelerating economic growth throughout the Continent was also aided by the
pending European Monetary Union (EMU), corporate restructuring, industry
consolidation, and government deregulation. The strong performance of our
longtime position in Philips Electronics demonstrated the benefits of several of
these themes. Philips continues to restructure its business portfolio, spinning
off underperforming units. The company stepped up its transformation with the
announced sale of Polygram, its entertainment unit. Philips also introduced a
share repurchase program, further demonstrating its commitment to enhancing
shareholder value.
Several of our European financial services stocks also posted solid gains.
Among them were Banca Di Roma and Banca Commerciale Italiana, which both
benefited from a drop in interest rates. United Bank of Switzerland (UBS) also
climbed as investors continued to recognize the value of its expanding asset
management business, fueled in part by a growing acceptance of equity investing
in Europe.
Much of Europe's growth was also reflected in its consumer cyclical sector.
A standout was Porsche, a manufacturer of high-end German sports cars and a new
stock in the Portfolio. We added this position because of the company's strong
pricing structure, new model introduction and high consumer demand.
The Portfolio's European technology stocks posted solid gains as well,
withstanding the second-quarter downturn in this sector created by the
reemergence of problems in Asia. Increased computer spending driven by the Year
2000 and EMU conversions created a positive backdrop for many of our stocks,
including Cap Gemini and Getronics. Among our U.S. technology stocks, Cisco
Systems and Microsoft also weathered the Asian storm thanks to their strong
business franchises and dominant market positions.
Our U.S. stocks, in general, posted strong results as inflation and
interest rates remained low, company fundamentals and profitability stayed
intact, and productivity improved. Latin America, however, did not fare as well,
and its markets declined on fears of volatility in emerging countries. Yet, as
economic reform continues in this area, I will consider increasing our Latin
American weighting by selectively adding high-quality franchise names.
Despite its impressive performance, the Portfolio was not immune to
disappointments. Our performance was bruised slightly by Japan's Nippon
Telegraph and Telephone, NTT Data, and Sony Corporation, all of which weakened
as a result of the continuing malaise in Asia. Fortunately, our travels to the
Far East early in the year convinced us to reduce our exposure to the region,
and our positions in these stocks were modest.
Bright Future Anticipated for Europe, U.S.
Overall, I view the global economies with cautious optimism. Europe
continues to demonstrate economic strength and growth that has thus far been
unencumbered by events in Asia. I will, therefore, continue to capitalize on
opportunities created by the monetary convergence and by the growing acceptance
of restructuring, consolidation, and shareholder value among European companies.
Benign inflation, low interest rates, and strong consumer spending lead me to
believe growth in the U.S. will also remain steady.
Meanwhile, Asia continues to be crippled by economic and political
imbalances, with no sign of a near-term recovery. Therefore, I continue to view
prospects in the Far East with caution, and will set my sights only on companies
that can prosper regardless of the economic climate.
In closing, I would like to thank you for your continued investment in
Janus Aspen Worldwide Growth Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 16
<PAGE>
JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO Portfolio Manager, Helen Young Hayes
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 9/13/93)
1 Year 30.47%
From Inception 26.49%
- --------------------------------------------------------------------------------
Morgan Stanley Capital International World Index(2)
1 Year 17.03%
From Inception Date of Institutional Shares 15.02%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 29.82%
From Inception 37.28%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
(2) Net dividends reinvested are the dividends that remain to be reinvested
after foreign tax obligations have been met. Such obligations vary from
country to country.
JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 95.9%
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 1.6%
676,875 Monsanto Co. $ 37,820,391
- --------------------------------------------------------------------------------
Airlines - 0.4%
257,454 Deutsche Lufthansa A.G.** 6,482,584
146,971 SAS Danmark A/S 2,949,244
38,144 SAS Norge A.S.A. - Class B 651,181
- --------------------------------------------------------------------------------
10,083,009
- --------------------------------------------------------------------------------
Appliances - 1.3%
1,767,025 Electrolux A.B. - Series B** 30,355,365
- --------------------------------------------------------------------------------
Applications Software - 1.1%
177,170 Intuit, Inc.* 10,851,663
318,585 PeopleSoft, Inc.* 14,973,495
- --------------------------------------------------------------------------------
25,825,158
- --------------------------------------------------------------------------------
Audio and Video Products - 1.7%
475,700 Sony Corp.** 40,959,861
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 2.7%
8,811 Bayerische Motoren Werke (BMW) A.G.** 8,908,461
2,643 Bayerische Motoren Werke
(BMW) A.G. - New*,** 2,635,829
351,000 Honda Motor Co., Ltd.** 12,493,712
546,273 Renault S.A.** 31,072,177
9,094 Volkswagen A.G.** 8,781,465
- --------------------------------------------------------------------------------
63,891,644
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 0.3%
61,468 Valeo S.A.** 6,283,004
- --------------------------------------------------------------------------------
Beverages - Non-Alcoholic - 0.1%
130,720 Coca-Cola Femsa S.A. (ADR) 2,271,260
- --------------------------------------------------------------------------------
Beverages - Wine and Spirits - 0.2%
408,764 Diageo PLC** 4,852,592
- --------------------------------------------------------------------------------
Brewery - 0.9%
385,975 Companhia Cervejaria Brahma (ADR) 4,824,688
145,040 Fomento Economico Mexicano, S.A. de C.V. 4,519,368
1,420,000 Kirin Brewery Co., Ltd.** 13,403,464
- --------------------------------------------------------------------------------
22,747,520
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.5%
307,275 Grupo Televisa S.A. (GDR)* 11,561,222
- --------------------------------------------------------------------------------
Building - Heavy Constuction - 0.3%
54,447 Compagnie Francaise d'Etudes et
de Construction Technip** $ 6,655,002
- --------------------------------------------------------------------------------
Building Products - Cement and Aggregate - 0.3%
194,926 Cimpor-Cimentos de Portugal S.A. 6,848,578
- --------------------------------------------------------------------------------
Cable Television - 2.9%
518,360 Comcast Corp. - Special Class A 21,042,176
98,605 MediaOne Group, Inc.* 4,332,457
1,176,175 Tele-Communications, Inc. - Class A* 45,209,227
- --------------------------------------------------------------------------------
70,583,860
- --------------------------------------------------------------------------------
Cellular Telecommunications - 1.4%
54,772 Cellular Communications International, Inc.* 2,731,754
5,108,000 China Telecom, Ltd.*,+ 8,866,481
14,630 Millicom International Cellular S.A.* 640,063
1,041,197 Telecom Italia Mobile S.p.A. 6,353,026
2,209,421 Telecom Italia S.p.A. 16,142,302
- --------------------------------------------------------------------------------
34,733,626
- --------------------------------------------------------------------------------
Chemicals - Diversified - 4.3%
182,303 Akzo Nobel N.V.** 40,525,280
226,845 E.I. du Pont de Nemours and Co. 16,928,308
252,872 Hoechst A.G.** 12,713,408
685,494 Imperial Chemical Industries PLC** 11,002,844
7,410,544 SNIA BPD S.p.A.+ 9,054,992
411,740 Solutia, Inc. 11,811,791
- --------------------------------------------------------------------------------
102,036,623
- --------------------------------------------------------------------------------
Commercial Banks - 1.7%
191,740 Banco Central Hispanoamericano 6,036,885
72,834 BG Bank A/S 4,510,996
402,824 Corporacion Bancaria de Espana S.A. 9,051,632
73,554 Credit Commercial de France** 6,192,327
414,512 Den norske Bank A.S.A. 2,171,538
69,809 Erste Bank Der Oesterreichischen
Sparkassen A.G.+ 4,232,844
460,598 Merita PLC - Class A 3,039,041
62,921 National Australia Bank, Ltd. 829,926
52,856 Royal Bank of Canada 3,202,540
26,390 Uniao de Bancos Brasileiros S.A. (GDR) 778,505
- --------------------------------------------------------------------------------
40,046,234
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 17
<PAGE>
JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Computer Services - 5.0%
70,690 Atos S.A.*,** $ 16,953,263
212,922 Cap Gemini S.A.** 33,455,992
336,036 Getronics N.V.** 17,427,694
746,890 Logica PLC** 24,207,161
322,926 Misys PLC** 18,346,209
270,600 WM-Data A.B. - Class B** 9,398,959
- --------------------------------------------------------------------------------
119,789,278
- --------------------------------------------------------------------------------
Computer Software - 5.3%
242,526 JBA Holdings PLC** 2,508,859
1,234,860 Merkantildata A.S.A. 15,609,671
534,400 Microsoft Corp.* 57,915,600
276 NTT Data Corp.** 9,963,323
861,875 Parametric Technology Co.* 23,378,359
237,714 Tieto Corp. - Class B 18,067,443
- --------------------------------------------------------------------------------
127,443,255
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 0.1%
181,220 SEMA Group PLC** 2,147,161
- --------------------------------------------------------------------------------
Consumer Products - 0.3%
154,984 Hagemeyer N.V.** 6,704,574
- --------------------------------------------------------------------------------
Cosmetics and Toiletries - 0.8%
105,560 Estee Lauder Companies, Inc. - Class A 7,356,213
786,000 Kao Corp.** 12,119,752
- --------------------------------------------------------------------------------
19,475,965
- --------------------------------------------------------------------------------
Data Processing and Management - 0.1%
85,410 American Management Systems, Inc.* 2,556,962
- --------------------------------------------------------------------------------
Diversified Operations - 9.3%
498,925 CBS Corp. 15,840,869
5,564,820 First Pacific Co., Ltd. 2,334,063
1,478,921 General Electric Co. PLC** 12,745,049
1,300,578 Hays PLC** 21,808,645
80,594 Lagardere S.C.A.** 3,355,179
26,967 Preussag A.G.** 9,651,166
7,435,482 Rentokil Initial PLC** 53,470,298
1,787,023 Siebe PLC** 35,690,325
131,432 Siemens A.G.** 8,020,478
660 Sulzer A.G.** 520,843
121,781 Tomkins PLC** 660,881
702,825 Tyco International, Ltd. 44,277,975
58,010 Vivendi** 12,386,793
188,789 Williams PLC** 1,215,879
- --------------------------------------------------------------------------------
221,978,443
- --------------------------------------------------------------------------------
Drug Delivery Systems - 0.4%
154,910 Elan Corp. PLC (ADR)* 9,962,647
- --------------------------------------------------------------------------------
Electric - Integrated - 0.3%
71,376 Companhia Energetica de Minas Gerais (ADR) 2,176,980
213,352 Endesa S.A. 4,675,654
22,000 Mosenergo (ADR)+ 104,500
- --------------------------------------------------------------------------------
6,957,134
- --------------------------------------------------------------------------------
Electronic Components - 3.2%
658,095 Electrocomponents PLC** 5,160,748
370,572 Philips Electronics N.V.** 31,150,883
475,848 Philips Electronics N.V. - N.Y. Shares** 40,447,080
- --------------------------------------------------------------------------------
76,758,711
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 1.2%
48,630 ASM Lithography Holding N.V. (ADR)* 1,413,309
65,000 Rohm Co., Ltd.** 6,650,574
359,145 Texas Instruments, Inc. 20,942,643
- --------------------------------------------------------------------------------
29,006,526
- --------------------------------------------------------------------------------
Film Processing - 0%
8,125 GrandVision S.A.** $ 270,115
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 0.3%
127,295 Household International, Inc. 6,332,926
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 0.7%
38,315 Morgan Stanley, Dean Witter, Discover and Co. 3,501,033
1,122,000 Nomura Securities Co., Ltd.** 13,056,381
- --------------------------------------------------------------------------------
16,557,414
- --------------------------------------------------------------------------------
Finance - Other Services - 0.1%
35,030 Newcourt Credit Group, Inc. - New York Shares 1,723,038
- --------------------------------------------------------------------------------
Food - Catering - 0.8%
1,623,706 Compass Group PLC** 18,693,159
- --------------------------------------------------------------------------------
Food - Dairy Products - 0.2%
158,505 Koninklijke Numico N.V.** 4,963,455
- --------------------------------------------------------------------------------
Food - Diversified - 1.1%
45,418 Danone** 12,522,567
775,480 Raisio Group PLC 14,077,833
- --------------------------------------------------------------------------------
26,600,400
- --------------------------------------------------------------------------------
Food - Retail - 0.3%
25,175 Disco S.A. (ADR)* 805,600
203,126 Koninklijke Ahold N.V.** 6,520,492
- --------------------------------------------------------------------------------
7,326,092
- --------------------------------------------------------------------------------
Human Resources - 0.6%
1,703,956 Capita Group PLC** 14,655,926
- --------------------------------------------------------------------------------
Investment Management and Advisory Services - 0.3%
701,343 Amvescap PLC** 6,845,616
- --------------------------------------------------------------------------------
Life and Health Insurance - 0.8%
23,254 Schweizerische Lebensversicherungs-
und Rentenanstalt** 19,684,810
- --------------------------------------------------------------------------------
Machinery - General Industrial - 0.9%
226,924 Alstom*,** 7,469,014
148,370 Mannesmann A.G.** 15,247,710
- --------------------------------------------------------------------------------
22,716,724
- --------------------------------------------------------------------------------
Medical - Biomedical and Genetic - 0.1%
1,674 Ares-Serono Group - Class B** 2,328,662
- --------------------------------------------------------------------------------
Medical - Drugs - 7.4%
856,173 Astra A.B. - Class A** 17,499,326
137,300 Bristol-Myers Squibb Co. 15,780,919
124,630 Eli Lilly and Co. 8,233,369
189,580 Merck KGaA** 8,496,805
12,512 Novartis A.G.** 20,820,187
31,105 Novo Nordisk A/S - Class B 4,287,840
75,565 Pfizer, Inc. 8,212,971
156,385 Pharmacia & Upjohn, Inc. 7,213,258
256,518 Rhone-Poulenc - Class A** 14,467,783
246 Roche Holding A.G.** 2,415,706
112,855 Schering A.G.** 13,286,003
164,725 SmithKline Beecham PLC (ADR) 9,965,863
571,000 Takeda Chemical Industries** 15,181,682
367,073 Warner-Lambert Co. 25,465,689
119,242 Zeneca Group PLC** 5,117,126
- --------------------------------------------------------------------------------
176,444,527
- --------------------------------------------------------------------------------
Medical - Wholesale Drug Distributors - 0%
96,739 Grupo Casa Autrey S.A. de C.V. (ADR) 628,804
- --------------------------------------------------------------------------------
Medical Instruments - 0%
25,520 U.S. Surgical Corp. 1,164,350
- --------------------------------------------------------------------------------
Medical Products - 0.2%
251,842 Ortivus A.B. - B Shares*,** 3,947,393
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 18
<PAGE>
JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Metal Processors and Fabricators - 1.0%
617,490 Assa Abloy A.B. - Class B** $ 24,273,906
- --------------------------------------------------------------------------------
Money Center Banks - 8.8%
3,900,577 Banca Commerciale Italiana 23,350,137
9,359,551 Banca di Roma* 18,918,660
23,722 Banco Bilbao Vizcaya S.A. 1,219,493
177,811 Bank Austria A.G. 14,462,621
98,035 BankAmerica Corp. 8,473,900
48,093 Credit Suisse Group** 10,700,995
319,507 Deutsche Bank A.G.** 27,011,551
50,331 Dresdner Bank A.G.** 2,718,659
111,134 ING Groep N.V.** 7,277,008
2,079,413 Lloyds TSB Group PLC** 29,195,848
172,305 National Westminster Bank PLC** 3,079,028
619,139 Skandinaviska Enskilda Banken - Class A** 10,597,246
494,993 Standard Chartered PLC** 5,677,125
122,530 UBS A.G.** 45,560,666
38,197 Unidanmark A/S - Class A 3,432,557
- --------------------------------------------------------------------------------
211,675,494
- --------------------------------------------------------------------------------
Mortgage Banks - 0.7%
212,930 Deutsche Pfandbrief-und
Hypothekenbank A.G.** 17,034,079
- --------------------------------------------------------------------------------
Multimedia - 1.2%
338,325 Time Warner, Inc. 28,905,642
- --------------------------------------------------------------------------------
Multi-Line Insurance - 3.2%
15,921 Allianz A.G.** 5,305,430
468 Allianz A.G. - New** 154,657
330,393 Assicurazioni Generali 10,692,907
3,550 Baloise Holding, Ltd.** 2,906,822
62,298 ERGO Versicherungs Gruppe A.G.** 11,182,367
1,570,657 Istituto Nazionale delle Assicurazioni 4,473,706
39,823 Pohjola Insurance Group - Class B 1,974,280
697,851 Royal & Sun Alliance Insurance Group PLC** 7,213,237
237,688 Sampo Insurance Co., Ltd. - Class A 11,263,840
257,711 Storebrand A.S.A.* 2,283,737
29,842 Zurich Versicherungs-Gesellschaft** 19,044,598
- --------------------------------------------------------------------------------
76,495,581
- --------------------------------------------------------------------------------
Music/Clubs - 0.1%
36,527 PolyGram N.V.** 1,863,859
- --------------------------------------------------------------------------------
Networking Products - 3.2%
822,737 Cisco Systems, Inc.* 75,743,225
- --------------------------------------------------------------------------------
Office Furnishings - 0.3%
205,306 Koninklijke Ahrend Groep N.V.** 6,701,490
- --------------------------------------------------------------------------------
Oil Companies - Integrated - 2.0%
237,995 Elf Aquitaine S.A.** 33,459,276
15,410 Lukoil Holding (ADR) 508,771
75,391 Total S.A.** 9,801,032
160,250 YPF S.A. (ADR) 4,817,516
- --------------------------------------------------------------------------------
48,586,595
- --------------------------------------------------------------------------------
Paper and Related Products - 0%
123,900 Kimberly-Clark de Mexico, S.A. de C.V. - Class A 437,771
- --------------------------------------------------------------------------------
Publishing - Books - 1.1%
193,979 Wolters Kluwer N.V.** 26,623,907
- --------------------------------------------------------------------------------
Recycling - 0.3%
207,147 Tomra Systems A.S.A. 6,208,845
- --------------------------------------------------------------------------------
Reinsurance - 0.4%
17,960 Muenchener Rueckversicherungs-
Gesellschaft A.G.** 8,915,156
- --------------------------------------------------------------------------------
Retail - Building Products - 0.2%
25,095 Castorama Dubois Investisse** 4,416,300
- --------------------------------------------------------------------------------
Retail - Discount - 0.3%
282,200 Cifra S.A. de C.V. - Class C $ 389,413
530,339 Cifra S.A. de C.V. - Class V 795,564
81,870 Costco Companies, Inc.* 5,162,927
- --------------------------------------------------------------------------------
6,347,904
- --------------------------------------------------------------------------------
Retail - Diversified - 0.3%
168,000 Ito-Yokado Co., Ltd.** 7,904,600
- --------------------------------------------------------------------------------
Retail - Pubs - 0.1%
509,505 J.D. Wetherspoon PLC** 2,452,565
- --------------------------------------------------------------------------------
Retail - Restaurants - 1.2%
71,770 Starbucks Corp.* 3,835,209
2,283,526 Tele Pizza S.A.* 24,611,780
- --------------------------------------------------------------------------------
28,446,989
- --------------------------------------------------------------------------------
Security Services - 0.7%
343,980 Securitas A.B. - Class B** 16,843,271
- --------------------------------------------------------------------------------
Special Purpose Banks - 0.1%
2,198 Dexia Belgium (Credit Communal)+ 330,793
13,100 Dexia France** 1,763,703
- --------------------------------------------------------------------------------
2,094,496
- --------------------------------------------------------------------------------
Telecommunication Equipment - 3.7%
88,115 Alcatel Alsthom** 17,940,629
30,290 Alcatel Alsthom (ADR)** 1,232,424
471,852 Nokia Oyj - Class A 34,831,061
176,945 Nokia Oyj (ADR) - Class A 12,839,572
462,180 Telefonaktiebolaget L.M. Ericsson - Class B** 13,503,280
289,772 Telefonaktiebolaget L.M. Ericsson
(ADR) - Class B** 8,294,724
- --------------------------------------------------------------------------------
88,641,690
- --------------------------------------------------------------------------------
Telecommunication Services - 1.1%
403,205 Clearnet Communications, Inc. - Class A* 4,435,255
1,465,364 Energis PLC*,** 22,312,144
- --------------------------------------------------------------------------------
26,747,399
- --------------------------------------------------------------------------------
Telephone - Integrated - 2.6%
153,540 Companhia de Telecommunicaciones
de Chile S.A. (ADR) 3,118,781
74,982 Hellenic Telecommunication Organization S.A.+ 1,922,109
3,625 Nippon Telegraph & Telephone Corp.** 30,037,465
194,950 Nortel Inversora S.A. (ADR) 4,849,381
82,800 Telecom Argentina Stet S.A. (ADR) 2,468,475
227,130 Telefonica de Argentina S.A. (ADR) 7,367,529
174,380 Telefonica de Espana 8,075,995
102,285 Telefonos de Mexico S.A. (ADR) 4,916,073
- --------------------------------------------------------------------------------
62,755,808
- --------------------------------------------------------------------------------
Telephone - Long Distance - 0.8%
388,560 WorldCom, Inc.* 18,820,875
- --------------------------------------------------------------------------------
Textile - Apparel - 0.1%
38,906 Chargeurs S.A.** 3,214,266
- --------------------------------------------------------------------------------
Tobacco - 0.1%
75,912 Tabacalera S.A. - Class A+ 1,557,016
- --------------------------------------------------------------------------------
Toys - 0.5%
286,440 Mattel, Inc. 12,119,993
- --------------------------------------------------------------------------------
Travel Services - 0.3%
1,341 Kuoni Reisen A.G. - Class B** 6,657,210
- --------------------------------------------------------------------------------
Total Common Stock (cost $1,700,420,558) 2,293,704,948
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 19
<PAGE>
JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Preferred Stock - 0.6%
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 0.4%
3,699 Porsche A.G.** $ 10,656,198
- --------------------------------------------------------------------------------
Telephone - Integrated - 0.2%
37,175 Telecomunicacoes Brasileiras S.A. (ADR) 4,059,045
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $14,881,170) 14,715,243
- --------------------------------------------------------------------------------
Rights - 0.2%
7,100 Baloise Holding, Ltd. ** (cost $0) 5,808,964
- --------------------------------------------------------------------------------
Repurchase Agreement - 1.3%
Morgan Stanley, Dean Witter, Discover & Co.,
$ 30,000,000 6.25%, dated 6/30/98, maturing 7/1/98,
to be repurchased at $30,005,208,
collateralized by $17,576,517 in Fannie
Mae 0.472% - 17.28% 6/25/00 - 7/18/28;
by $16,845,262 in Freddie Mac 6.00% -
855.25%, 10/15/05 - 6/15/35; with
respective values of $22,514,898 and
$14,643,041 (cost $30,000,000)*** 30,000,000
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 2.1%
IBM Credit Corp.
50,000,000 5.51%, 7/1/98 (amortized cost $50,000,000) 50,000,000
- --------------------------------------------------------------------------------
U.S. Government Agencies - 5.2%
Fannie Mae:
25,000,000 5.46%, 7/13/98 24,954,500
25,000,000 5.75%, 7/27/98 24,903,042
50,000,000 5.40%, 9/14/98 49,438,500
Freddie Mac:
10,300,000 5.85%, 7/1/98 10,300,000
15,000,000 5.38%, 7/23/98 14,950,683
- --------------------------------------------------------------------------------
Total U.S. Government Agencies (cost $124,545,725) 124,546,725
- --------------------------------------------------------------------------------
U.S. Government Obligation - 0.2%
U.S. Treasury Bill
6,200,000 5.075%, 10/1/98 (cost $6,120,699) 6,121,198
- --------------------------------------------------------------------------------
Total Investments (total cost $1,925,968,152) - 105.5% 2,524,897,078
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (5.5%) (131,929,552)
- --------------------------------------------------------------------------------
Net Assets - 100% $2,392,967,526
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 20
<PAGE>
JANUS ASPEN WORLDWIDE GROWTH PORTFOLIO June 30, 1998 (unaudited)
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Argentina 0.8% $ 20,308,501
Australia -- 829,926
Austria 0.8% 18,695,465
Belgium -- 330,793
Brazil 0.5% 11,839,218
Canada 0.4% 9,360,833
Chile 0.1% 3,118,781
Denmark 0.6% 15,180,637
Finland 3.8% 96,093,070
France 8.8% 222,910,846
Germany 7.0% 177,202,006
Greece 0.1% 1,922,109
Hong Kong 0.5% 11,200,544
Ireland 0.4% 9,962,647
Italy 3.5% 88,985,730
Japan 6.4% 161,770,814
Luxembourg -- 640,063
Mexico 1.0% 25,519,475
Netherlands 7.6% 191,619,031
Norway 1.1% 26,924,972
Portugal 0.3% 6,848,578
Russia -- 613,271
Spain 2.2% 55,228,455
Sweden 5.3% 134,713,470
Switzerland 5.4% 136,449,463
United Kingdom 12.6% 319,024,288
United States++ 30.8% 777,604,092
- --------------------------------------------------------------------------------
Total 100.0% $2,524,897,078
================================================================================
++Includes Short-Term Securities (22.5% excluding Short-Term Securities)
Forward Currency Contracts
Open at June 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
British Pound 7/10/98 6,500,000 $10,829,650 ($ 150,150)
British Pound 8/7/98 45,300,000 75,347,490 (1,747,536)
British Pound 8/13/98 9,000,000 14,964,300 (420,300)
British Pound 10/7/98 32,200,000 53,371,500 (521,036)
Dutch Guilder 7/17/98 17,000,000 8,350,115 3,693
Dutch Guilder 7/23/98 6,500,000 3,193,946 (157)
Dutch Guilder 7/31/98 33,000,000 16,224,189 86,424
French Franc 7/23/98 13,300,000 2,198,020 (2,214)
French Franc 7/31/98 132,200,000 21,859,549 23,356
German Deutschemark 7/23/98 8,100,000 4,487,784 12,587
German Deutschemark 11/4/98 300,000 167,224 4,794
German Deutschemark 11/12/98 3,600,000 2,007,584 6,526
Japanese Yen 7/23/98 950,000,000 6,828,382 799,077
Japanese Yen 8/7/98 883,000,000 6,346,947 453,469
Japanese Yen 10/7/98 500,000,000 3,594,283 250,628
Japanese Yen 10/21/98 3,480,000,000 25,016,732 705,022
Japanese Yen 11/4/98 2,687,000,000 19,316,469 730,133
Swedish Krona 7/10/98 12,662,000 1,584,909 (178)
Swedish Krona 8/7/98 11,000,000 1,378,567 (190)
Swedish Krona 8/14/98 22,000,000 2,757,929 23,360
Swedish Krona 10/7/98 78,338,000 9,842,818 107,329
Swedish Krona 11/4/98 25,000,000 3,145,010 131,530
Swiss Franc 7/10/98 1,020,000 672,114 31,820
Swiss Franc 7/17/98 6,000,000 3,956,479 198,646
Swiss Franc 7/23/98 500,000 329,946 16,939
Swiss Franc 10/7/98 8,300,000 5,518,984 81,556
Swiss Franc 11/4/98 6,000,000 4,001,334 156,670
Swiss Franc 12/2/98 22,480,000 15,035,784 184,257
- --------------------------------------------------------------------------------
Total $322,328,038 $ 1,166,055
================================================================================
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 21
<PAGE>
JANUS ASPEN BALANCED PORTFOLIO Portfolio Manager, Blaine P. Rollins
Janus Aspen Balanced Portfolio returned solid results, gaining 17.45% for
its Institutional Shares and 17.16% for its Retirement Shares during the six
months ended June 30, 1998. The S&P 500 Index appreciated 17.72% for the same
period, while the Lehman Brothers Government/Corporate Index rose 4.17%. All
returns include reinvested dividends. The average annual total returns for the
period ended June 30, 1998, follow on the next page.
U.S., Europe Gain Despite Asia's Shadow
Asia continued to be the focus around the globe as financial distress there
caused downward pricing pressure on worldwide material, commodity, and labor
markets. Amid this turmoil, we avoided companies with broad-based Asian exposure
and concentrated on those with clearer prospects in both the U.S. and Europe.
Here, economies prospered from benign inflation and low interest rate
environments sustained by the Asian crisis.
A diverse mix of fixed-income investments provided a stable base for the
Portfolio and included positions in Treasuries, convertible bonds,
investment-grade and high-yield corporate bonds, as well as preferred stocks. In
an effort to boost income potential, and with prospects for continued low
interest rates, I lengthened the maturity to 7-10 years. I also increased our
weighting in high-yield bonds by adding what I believe to be several impressive
cable issues. My theory is, given the strong cash flow dynamics of these
companies, they could potentially move toward investment-grade status, creating
opportunities for appreciation.
My strategy for the equity portion of the Portfolio included searching out
companies generating significant free cash flow and reinvesting it in their own
stock, applying it toward debt, or using it to make strategic acquisitions. The
success of this approach was most evident in our cable, technology, and cruise
line stocks.
Cable, Technology, and Cruise Lines Boost Results
Standouts in the cable industry included Comcast, which has positioned
itself as a leader in the move toward digital data, video, telephony, and other
new value-added services. MediaOne (formerly U.S. West Media Group) and Time
Warner also gained, as did Houston Industries, which is one of our largest
fixed-income positions. This holding, through a strategic alliance, is
convertible to Time Warner common stock, which, in addition to a 4% yield,
offers considerable upside potential.
While the technology industry was temporarily shaken by rumblings in Asia,
many of our holdings regained ground and ended the period with noteworthy gains.
Among our top performers was Dell Computer. Dell builds computers to customer
specifications, thus reducing overhead costs by eliminating the need to maintain
inventory. This enables the company to generate more free cash flow, which it
frequently reinvests in its own stock. Such was the case during the second
quarter when the brief decline in Dell's shares provided an ideal buying
opportunity. Cisco Systems also rebounded nicely from the downturn in the
technology sector. Rapid growth of the Internet and an increasing demand for
data communications hardware continue to drive this company's performance.
Unfortunately, semiconductors were a segment of the technology industry
that did not recover; therefore, I eliminated our Intel position at a loss.
Intel suffered from delays in a new chip rollout and increased competition for
its existing chips.
Carnival Corporation and Royal Caribbean Cruises produced exceptional
results, illustrating the high demand for cruise ship vacations. In fact, our
research indicates that 1999 reservations are on track to outpace 1998 bookings.
Merger and acquisition activity has further heightened our enthusiasm for this
business, and we look for Carnival's recent merger with the cruise line Cunard
to further accelerate its profits.
While the Portfolio posted strong gains, we did experience some
disappointments. The deterioration of Asia's economy, as well as conflicts
within OPEC, had a negative effect on our oil services stocks. Therefore, I
eliminated these positions at a loss. Another weak performer was Charles Schwab,
which suffered from the threat of increased competition within its industry and
from the online trading segment. However, the company's continued growth in
assets leads me to believe the market's perception of these threats is overblown
and that the stock is just temporarily depressed. Therefore, I maintained our
position in the company.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Equities 45.4% 47.8%
Number of Stocks 46 64
Top 10 Equities 21.6% 17.7%
Fixed-Income Securities 39 60
U.S. Treasury Notes/Bonds 9.2% 18.9%
Investment-Grade Corp. Bonds 4.4% 8.6%
High-Yield Corporate Bonds 20.8% 4.3%
Foreign Corporate Bonds -- 0.8%
Preferred Stock 15.7% 8.3%
Cash & Cash Equivalents 4.5% 11.3%
- --------------------------------------------------------------------------------
Steady Economic Growth Ahead
Moderate economic growth in the U.S. and Europe coupled with benign
inflation and low interest rates should continue to provide a positive backdrop
for the Portfolio. Helping to keep a lid on these factors is Asia's unraveling
economy. Going forward, I'll continue to avoid companies with exposure to Asia
and emphasize businesses that should do well despite economic and market
pressures. As always, our in-depth, hands-on research will be key in uncovering
these companies.
Thank you for your continued confidence and investment in Janus Aspen
Balanced Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 22
<PAGE>
JANUS ASPEN BALANCED PORTFOLIO Portfolio Manager, Blaine P. Rollins
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 9/13/93)
1 Year 27.68%
From Inception 18.41%
- --------------------------------------------------------------------------------
S&P 500 Index
1 Year 30.17%
From Inception Date of Institutional Shares 23.42%
- --------------------------------------------------------------------------------
Lehman Brothers Govt./Corp. Bond Index
1 Year 11.28%
From Inception Date of Institutional Shares 6.54%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 27.08%
From Inception 30.97%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
JANUS ASPEN BALANCED PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 45.4%
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 0.5%
54,200 Monsanto Co. $ 3,028,425
- --------------------------------------------------------------------------------
Airlines - 0.5%
76,025 Ryanair Holdings PLC (ADR)* 2,708,391
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 1.0%
80,440 Federal-Mogul Corp. 5,429,700
- --------------------------------------------------------------------------------
Cable Television - 3.3%
460,570 Comcast Corp. - Special Class A 18,696,263
- --------------------------------------------------------------------------------
Chemicals - Diversified - 0.7%
129,165 Solutia, Inc. 3,705,421
- --------------------------------------------------------------------------------
Circuits - 1.6%
118,715 Linear Technology Corp. 7,159,998
90,800 SIPEX Corp.* 1,952,200
- --------------------------------------------------------------------------------
9,112,198
- --------------------------------------------------------------------------------
Commercial Banks - 1.6%
56,490 Northern Trust Corp. 4,307,363
43,725 Star Banc Corp. 2,792,934
27,045 U.S. Trust Corp. 2,062,181
- --------------------------------------------------------------------------------
9,162,478
- --------------------------------------------------------------------------------
Commercial Services - 0.9%
86,065 Gartner Group, Inc. - Class A* 3,012,275
34,825 HealthCare Financial Partners, Inc.* 2,135,208
- --------------------------------------------------------------------------------
5,147,483
- --------------------------------------------------------------------------------
Computer Software - 6.2%
188,285 Cadence Design Systems, Inc.* 5,883,906
117,430 Microsoft Corp. 12,726,476
336,300 Parametric Technology Co.* 9,122,138
193,850 Wind River Systems* 6,954,369
- --------------------------------------------------------------------------------
34,686,889
- --------------------------------------------------------------------------------
Computers - Micro - 4.1%
245,485 Dell Computer Corp.* 22,784,077
- --------------------------------------------------------------------------------
Cruise Lines - 1.5%
75,450 Carnival Corp. - Class A 2,989,706
65,100 Royal Caribbean Cruises, Ltd. 5,175,450
- --------------------------------------------------------------------------------
8,165,156
- --------------------------------------------------------------------------------
Diversified Operations - 1.4%
228,760 CBS Corp. $ 7,263,130
31,100 Roper Industries, Inc. 812,487
- --------------------------------------------------------------------------------
8,075,617
- --------------------------------------------------------------------------------
Electronic Components - Semiconductor - 1.4%
240,555 Maxim Integrated Products, Inc.* 7,622,587
- --------------------------------------------------------------------------------
Electronic Safety Devises - 0.2%
16,925 Pittway Corp. - Class A 1,250,334
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 0.8%
15,380 Beneficial Corp. 2,356,024
46,860 Household International, Inc. 2,331,285
- --------------------------------------------------------------------------------
4,687,309
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 3.5%
288,747 Charles Schwab Corp. 9,384,277
113,785 Morgan Stanley, Dean Witter, Discover and Co. 10,397,104
- --------------------------------------------------------------------------------
19,781,381
- --------------------------------------------------------------------------------
Finance - Other Services - 1.1%
131,890 Newcourt Credit Group, Inc. 6,296,099
- --------------------------------------------------------------------------------
Human Resources - 0.9%
67,700 Robert Half International, Inc.* 3,782,738
49,325 Romac International, Inc.* 1,498,247
- --------------------------------------------------------------------------------
5,280,985
- --------------------------------------------------------------------------------
Instruments - Scientific - 1.5%
323,660 Dionex Corp.* 8,536,532
- --------------------------------------------------------------------------------
Internet Software - 0.2%
8,200 America Online, Inc. 869,200
- --------------------------------------------------------------------------------
Life and Health Insurance - 1.7%
11,343 Schweizerische Lebensversicherungs-
und Rentenanstalt 9,601,995
- --------------------------------------------------------------------------------
Medical - Drugs - 1.8%
17,120 Pfizer, Inc. 1,860,730
114,600 Warner-Lambert Co. 7,950,375
- --------------------------------------------------------------------------------
9,811,105
- --------------------------------------------------------------------------------
Medical - Outpatient and Home Medical Care - 0%
376 Coram Healthcare Corp.* 729
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 23
<PAGE>
JANUS ASPEN BALANCED PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Money Center Banks - 1.8%
170,015 Bank of New York Co., Inc. $ 10,317,785
- --------------------------------------------------------------------------------
Multimedia - 0.5%
62,175 Meredith Corp. 2,918,339
- --------------------------------------------------------------------------------
Music/Clubs - 0.4%
65,230 Steinway Musical Instruments, Inc.* 2,103,668
- --------------------------------------------------------------------------------
Networking Products - 1.7%
104,962 Cisco Systems, Inc.* 9,663,064
- --------------------------------------------------------------------------------
Power Converters and Power Supply Equipment - 0.4%
68,125 American Power Conversion Corp.* 2,043,750
- --------------------------------------------------------------------------------
Radio - 0.7%
84,490 Heftel Broadcasting Corp. - Class A* 3,780,928
- --------------------------------------------------------------------------------
Retail - Discount - 1.4%
124,775 Costco Companies, Inc.* 7,868,623
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 0.8%
103,805 Fred Meyer, Inc.* 4,411,712
- --------------------------------------------------------------------------------
Schools - 0.5%
76,860 Apollo Group, Inc. - Class A 2,541,184
- --------------------------------------------------------------------------------
Television - 0.8%
127,783 Univision Communications, Inc. - Class A* 4,759,917
- --------------------------------------------------------------------------------
Total Common Stock (cost $199,532,208) 254,849,324
- --------------------------------------------------------------------------------
Corporate Bonds - 25.2%
- --------------------------------------------------------------------------------
Advertising Services - 0.5%
$ 2,950,000 AKI, Inc., 10.50%
senior notes, due 7/1/08 2,964,750
- --------------------------------------------------------------------------------
Cable Television - 8.6%
Adelphia Communications Corp.:
2,700,000 9.25%, senior notes, due 10/1/02 2,794,500
9,230,000 8.375%, senior notes, due 2/1/08 9,276,150
6,000,000 FrontierVision, 11.00%
senior subordinated notes, due 10/15/06 6,645,000
5,745,000 Galaxy Telecom, L.P., 12.375%
senior subordinated notes, due 10/1/05 6,391,313
11,205,000 Jones Intercable, Inc., 7.625%
senior notes, due 4/15/08 11,373,075
3,000,000 Lenfest Communications, Inc., 7.625%
senior notes, due 2/15/08 3,060,000
6,000,000 Mediacom L.L.C., 8.50%
senior notes, due 4/15/08+ 5,985,000
2,505,000 Rifkin Acquisition Partners, L.P., 11.125%
senior subordinated notes, due 1/15/06 2,761,763
- --------------------------------------------------------------------------------
48,286,801
- --------------------------------------------------------------------------------
Computer Software - 1.5%
3,000,000 Aspen Technology, Inc., 5.25%
subordinated debenture, due 6/15/05+ 3,408,750
5,000,000 Wind River Systems, Inc., 5.00%
convertible subordinated notes, due 8/1/02 5,062,500
- --------------------------------------------------------------------------------
8,471,250
- --------------------------------------------------------------------------------
Computers - Mainframe - 0.4%
2,000,000 IBM Corp., 6.375%
notes, due 6/15/00 2,020,000
- --------------------------------------------------------------------------------
Computers - Micro - 1.4%
7,900,000 Dell Computer Corp., 6.55%
senior notes, due 4/15/08 7,998,750
- --------------------------------------------------------------------------------
Cruise Lines - 0.2%
1,300,000 Royal Caribbean Cruises, Ltd., 7.00%
senior notes, due 10/15/07 1,335,750
- --------------------------------------------------------------------------------
Distribution and Wholesale - 0.5%
3,000,000 Aviation Sales Co., 8.125%
senior subordinated notes, due 2/15/08 2,932,500
- --------------------------------------------------------------------------------
Diversified Financial Services - 0.4%
$ 2,000,000 Associates Corp. of North America, 6.75%
senior notes, due 7/15/01 $ 2,040,000
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 0.1%
300,000 Lehman Brothers Holdings, Inc., 6.85%
notes, due 10/8/99 303,351
100,000 Merrill Lynch & Co., Inc., 6.375%
notes, due 3/30/99 100,417
- --------------------------------------------------------------------------------
403,768
- --------------------------------------------------------------------------------
Multimedia - 1.9%
8,000,000 Time Warner, Inc., 8.11%
notes, due 8/15/06 8,780,000
2,000,000 Walt Disney Co. (The), 6.375%
senior notes, due 3/30/01 2,027,500
- --------------------------------------------------------------------------------
10,807,500
- --------------------------------------------------------------------------------
Radio - 3.4%
8,000,000 Chancellor Media Corp., 8.125%
senior subordinated notes, due 12/15/07 8,080,000
13,000,000 Jacor Communications, Inc., zero coupon
senior notes, due 6/12/11 10,773,750
- --------------------------------------------------------------------------------
18,853,750
- --------------------------------------------------------------------------------
Rental Auto/Equipment - 0.4%
1,800,000 Ryder TRS, Inc., 10.00%
senior subordinated notes, due 12/1/06 2,088,000
- --------------------------------------------------------------------------------
Retail - Diversified - 1.8%
10,000,000 Falcon Holding Group, 8.375%
debentures, due 4/15/10 10,025,000
- --------------------------------------------------------------------------------
Retail - Music Store - 0.5%
2,980,000 MTS, Inc., 9.375%
senior subordinated notes, due 5/1/05+ 2,939,025
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 0.9%
5,000,000 Fred Meyer, Inc., 7.45%
senior notes, due 3/1/08 5,018,750
- --------------------------------------------------------------------------------
Telecommunication Services - 2.5%
11,500,000 Level 3 Communications, Inc., 9.125%
senior notes, due 5/1/08 11,183,750
2,415,000 Qwest Communications International, Inc.,
10.875% senior notes, due 4/1/07 2,798,381
- --------------------------------------------------------------------------------
13,982,131
- --------------------------------------------------------------------------------
Television - 0.2%
1,250,000 Sinclair Broadcast Group, Inc., 10.00%
senior subordinated notes, due 9/30/05 1,328,125
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $139,563,933) 141,495,850
- --------------------------------------------------------------------------------
Preferred Stock - 15.7%
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 2.3%
173,000 Federal-Mogul Financial Trust, 7.00%+ 12,845,250
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 1.7%
45,683 TCI Pacific Communications, 5.00% 9,636,972
- --------------------------------------------------------------------------------
Cable Television - 3.3%
250,150 Houston Industries, Inc., 7.00% 18,636,175
- --------------------------------------------------------------------------------
Cruise Lines - 3.1%
138,652 Royal Caribbean Cruises, Ltd., 7.25% 17,470,152
- --------------------------------------------------------------------------------
Radio - 1.0%
51,918 Chancellor Media Corp., $3.00 5,321,595
- --------------------------------------------------------------------------------
Telephone - Local - 4.3%
270,233 MediaOne Group, Inc., 4.50% 24,304,080
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $67,045,387) 88,214,224
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 24
<PAGE>
JANUS ASPEN BALANCED PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
U.S. Government Obligations - 9.2%
U.S. Treasury Notes:
$ 8,000,000 6.50%, due 5/15/05 $ 8,442,400
525,000 7.00%, due 7/15/06 573,132
26,000,000 6.125%, due 8/15/07 27,040,520
15,000,000 6.625%, due 5/15/08 15,199,050
- --------------------------------------------------------------------------------
Total U.S. Government Obligations (cost $50,579,877) 51,255,102
- --------------------------------------------------------------------------------
U.S. Government Agency - 4.9%
Freddie Mac
27,500,000 5.75%, 7/1/98
(amortized cost $27,500,000) 27,500,000
- --------------------------------------------------------------------------------
Total Investments (total cost $484,221,405) - 100.4% 563,314,500
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (0.4%) (2,280,970)
- --------------------------------------------------------------------------------
Net Assets - 100% $ 561,033,530
- --------------------------------------------------------------------------------
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Canada 1.1% $ 6,296,099
Ireland 0.5% 2,708,391
Switzerland 1.7% 9,601,995
United States++ 96.7% 544,708,015
- --------------------------------------------------------------------------------
Total 100.0% $ 563,314,500
================================================================================
++Includes Short-Term Securities (91.8% excluding Short-Term Securities)
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 25
<PAGE>
JANUS ASPEN EQUITY INCOME PORTFOLIO Portfolio Manager, Blaine P. Rollins
Janus Aspen Equity Income Portfolio outperformed its index during the
period, returning 22.61% for its Institutional Shares and 22.37% for its
Retirement Shares during the six months ended June 30, 1998. This compares with
a 17.72% gain posted by the S&P 500 Index. All returns include reinvested
dividends. The average annual total returns for the period ended June 30, 1998,
follow on the next page.
I attribute the Portfolio's impressive performance to an investment
strategy that begins with our bottom-up, hands-on research. This method of
investigating companies one by one continues to turn up what we believe to be
the most compelling growth-stock and fixed-income opportunities. The result is a
Portfolio that pursues long-term capital growth and current income by
diversifying across smaller, lesser-known companies as well as larger, more
established businesses.
Drugs, Technology, and Cable Drive Performance
Many of our top performers shared several characteristics, including
historically predictable earnings, management teams focused on increasing
shareholder value, strong cash flows, and improving profitability. Among the
industries represented by these stocks were pharmaceuticals, technology, and
cable.
Headlines in the drug/biotech industry were dominated by the announced
merger of American Home Products and Monsanto. As a result of this proposed
union, our shares in Monsanto appreciated nicely. While the recent frenzy of
mergers has shown many investors that bigger companies aren't necessarily better
companies, the compatible business segments, including overlaps in
pharmaceuticals and biotechnology, make this merger appealing. For example, I
look for American Home's expertise in pain relievers to accelerate future sales
of Celebra, Monsanto's new acetaminophen. American Home also brings significant
free cash flow to the table, which is crucial to new product development.
The Portfolio's performance was also supported by substantial gains in
several of our technology positions. Microsoft, Dell Computer, Cisco Systems,
and Wind River Systems all garnered impressive results after rebounding from a
temporary downturn in this sector caused by a second round of problems in Asia.
I took advantage of the decline by bargain hunting for companies that - like
those mentioned above - are capable of growing their top and bottom lines
despite a pullback in Asian demand.
My enthusiasm for the cable industry was rewarded by several exciting
developments. In particular, AT&T's announced acquisition of
Tele-Communications, Inc. (TCI) at a substantial premium caused several of our
other cable holdings to appreciate considerably. These included MediaOne
(formerly U.S. West Media Group) and Comcast - both new additions to the
Portfolio - and our preferred stock position in Houston Industries. I view the
AT&T/TCI merger as a turning point in this industry as companies join forces and
technologies to carry new value-added services, such as telephony and digital
cable, into subscribers' homes through the cable pipeline.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Equities 68.9% 74.7%
Number of Stocks 41 69
Top 10 Equities 31.4% 28.5%
Fixed-Income Securities
Investment-Grade Corp. Bonds 6.0% 7.9%
High-Yield Corporate Bonds 3.1% --
Preferred Stock 21.5% 6.2%
Cash & Cash Equivalents 0.5% 11.2%
- --------------------------------------------------------------------------------
Positive Outlook for Radio Stocks
I consider radio to be a promising industry and took the opportunity to add
to our weighting in this sector during a slight downturn. New positions include
Jacor Communications convertible bonds and Chancellor Media preferred stock. I'm
increasingly optimistic as radio continues to take a considerable amount of
advertising share away from television and other more costly media segments. As
a result, I anticipate strong future results from these positions.
Despite the Portfolio's impressive performance, certain stocks did not meet
my expectations. Intel declined amid a slowdown in the semiconductor industry
and delays in the company's plans to roll out a new chip. With its prospects
dimmed, I sold the position at a loss. Our oil services companies languished
because of a decline in Asian demand, conflicts within OPEC, and the warmest
winter on record. These holdings, as well, were eliminated at a loss. Charles
Schwab was another disappointment. This discount brokerage firm's results were
hindered by increased competition and the growing popularity of online trading.
I opted to maintain this position, however, because of the company's continued
growth in assets and solid business fundamentals.
All Eyes Still on Asia
My outlook for the economy is both optimistic and cautious. I continue to
closely monitor the Asian crisis, especially after its reemergence during the
period. Yet, I believe this situation should help keep global inflation and
interest rates in check, providing a healthy environment for economic growth,
particularly in the U.S. and Europe. Going forward, our goal is to fulfill your
expectations by investing in companies we believe will prosper regardless of
economic events. I'm confident our exceptional research capabilities will enable
us to keep doing so.
In closing, I'd like to express my appreciation for your investment in
Janus Aspen Equity Income Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 26
<PAGE>
JANUS ASPEN EQUITY INCOME PORTFOLIO Portfolio Manager, Blaine P. Rollins
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 5/1/97)
1 Year 41.88%
From Inception 53.73%
- --------------------------------------------------------------------------------
S&P 500 Index
1 Year 30.17%
From Inception Date of Institutional Shares 36.91%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 41.21%
From Inception 52.99%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
JANUS ASPEN EQUITY INCOME PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 68.9%
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 1.2%
1,225 Monsanto Co. $ 68,447
- --------------------------------------------------------------------------------
Airlines - 1.6%
2,600 Ryanair Holdings PLC (ADR)* 92,625
- --------------------------------------------------------------------------------
Automotive - Trucks Parts and Equipment - 1.4%
1,225 Federal-Mogul Corp. 82,687
- --------------------------------------------------------------------------------
Cable Television - 4.5%
6,237 Comcast Corp. - Special Class A 253,183
111 Tele-Communications, Inc. - Class A* 4,267
- --------------------------------------------------------------------------------
257,450
- --------------------------------------------------------------------------------
Chemicals - Diversified - 0.8%
1,675 Solutia, Inc. 48,052
- --------------------------------------------------------------------------------
Circuits - 3.1%
2,070 Linear Technology Corp. 124,847
2,570 SIPEX Corp.* 55,255
- --------------------------------------------------------------------------------
180,102
- --------------------------------------------------------------------------------
Commercial Banks - 3.1%
105 M & T Bank Corp. 58,170
575 Northern Trust Corp. 43,844
575 Star Banc Corp. 36,728
555 U.S. Trust Corp. 42,319
- --------------------------------------------------------------------------------
181,061
- --------------------------------------------------------------------------------
Commercial Services - 0.8%
1,335 Gartner Group, Inc. - Class A* 46,725
- --------------------------------------------------------------------------------
Computer Software - 9.6%
3,880 Cadence Design Systems, Inc.* 121,250
1,960 Microsoft Corp.* 212,415
2,710 Parametric Technology Co.* 73,509
4,200 Wind River Systems* 150,675
- --------------------------------------------------------------------------------
557,849
- --------------------------------------------------------------------------------
Computers - Micro - 5.2%
3,255 Dell Computer Corp.* 302,105
- --------------------------------------------------------------------------------
Cruise Lines - 2.0%
730 Carnival Corp. - Class A $ 28,926
1,084 Royal Caribbean Cruises, Ltd. 86,178
- --------------------------------------------------------------------------------
115,104
- --------------------------------------------------------------------------------
Diversified Operations - 2.0%
3,640 CBS Corp. 115,570
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 2.3%
4,290 Maxim Integrated Products, Inc.* 135,939
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 1.2%
155 Beneficial Corp. 23,744
870 Household International, Inc. 43,282
- --------------------------------------------------------------------------------
67,026
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 4.8%
4,505 Charles Schwab Corp. 146,412
1,415 Morgan Stanley, Dean Witter, Discover and Co. 129,296
- --------------------------------------------------------------------------------
275,708
- --------------------------------------------------------------------------------
Finance - Other Services - 1.3%
1,520 Newcourt Credit Group, Inc. 72,561
- --------------------------------------------------------------------------------
Human Resources - 2.0%
900 Robert Half International, Inc.* 50,288
2,225 Romac International, Inc.* 67,584
- --------------------------------------------------------------------------------
117,872
- --------------------------------------------------------------------------------
Instruments - Scientific - 2.6%
5,655 Dionex Corp.* 149,151
- --------------------------------------------------------------------------------
Life and Health Insurance - 2.2%
153 Schweizerische Lebensversicherungs-
und Rentenanstalt 129,516
- --------------------------------------------------------------------------------
Medical - Drugs - 1.8%
1,500 Warner-Lambert Co. 104,062
- --------------------------------------------------------------------------------
Money Center Banks - 4.6%
2,405 Bank of New York Co., Inc. 145,953
325 UBS A.G. 120,846
- --------------------------------------------------------------------------------
266,799
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 27
<PAGE>
JANUS ASPEN EQUITY INCOME PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Multimedia - 0.5%
650 Meredith Corp. $ 30,509
- --------------------------------------------------------------------------------
Music/Clubs - 0.2%
280 Steinway Musical Instruments, Inc.* 9,030
- --------------------------------------------------------------------------------
Networking Products - 2.9%
1,837 Cisco Systems, Inc.* 169,119
- --------------------------------------------------------------------------------
Radio - 1.5%
1,890 Heftel Broadcasting Corp. - Class A* 84,578
- --------------------------------------------------------------------------------
Retail - Discount - 1.8%
1,670 Costco Companies, Inc.* 105,314
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 1.2%
1,690 Fred Meyer, Inc.* 71,825
- --------------------------------------------------------------------------------
Television - 2.7%
4,122 Univision Communications, Inc. - Class A* 153,545
- --------------------------------------------------------------------------------
Total Common Stock (total cost $3,316,589) 3,990,331
- --------------------------------------------------------------------------------
Corporate Bonds - 9.1%
- --------------------------------------------------------------------------------
Computer Software - 3.2%
$ 185,000 Wind River Systems, Inc., 5.00%
convertible subordinated notes, due 8/1/02 187,313
- --------------------------------------------------------------------------------
Drug Delivery Systems - 2.8%
125,000 ALZA Corp., 5.00%
subordinated debentures, due 5/1/06 158,750
- --------------------------------------------------------------------------------
Radio - 3.1%
220,000 Jacor Communications, Inc., zero coupon
senior notes, due 6/12/11 182,325
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $515,219) 528,388
- --------------------------------------------------------------------------------
Preferred Stock - 21.5%
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 2.6%
2,000 Federal-Mogul Financial Trust, 7.00%+ 148,500
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 1.8%
500 TCI Pacific Communications, 5.00% 105,477
- --------------------------------------------------------------------------------
Cable Television - 4.7%
3,675 Houston Industries, Inc., 7.00% 273,787
- --------------------------------------------------------------------------------
Cruise Lines - 5.9%
2,700 Royal Caribbean Cruises, Ltd., 7.25% 340,200
- --------------------------------------------------------------------------------
Radio - 2.0%
1,100 Chancellor Media Corp., $3.00 112,750
- --------------------------------------------------------------------------------
Telephone - Local - 4.5%
2,910 MediaOne Group, Inc. 4.50% 261,718
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $991,972) 1,242,432
- --------------------------------------------------------------------------------
Total Investments (total cost $4,823,780) - 99.5% 5,761,151
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 0.5% 27,649
- --------------------------------------------------------------------------------
Net Assets - 100% $ 5,788,800
- --------------------------------------------------------------------------------
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Canada 1.3% $ 72,561
Ireland 1.6% 92,625
Switzerland 4.3% 250,362
United States 92.8% 5,345,603
- --------------------------------------------------------------------------------
Total 100.0% $ 5,761,151
================================================================================
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 28
<PAGE>
JANUS ASPEN GROWTH AND INCOME PORTFOLIO Portfolio Manager, David J. Corkins
Janus Aspen Growth and Income Portfolio opened on May 1, 1998. Before going
into detail about its performance, I'd like to thank you for your investment in
this new Portfolio and assure you of my commitment to pursue the results you
expect.
We posted solid gains in our first two months, returning 5.60% for the
Institutional Shares during the period ended June 30, 1998, and 5.50% for the
Retirement Shares. In comparison, the S&P 500 Index appreciated 2.27%. All
returns include reinvested dividends. The cumulative total returns for the
period ended June 30, 1998, follow on the next page.
The Portfolio opened during a time of considerable volatility as the market
reacted to worries about new problems in Asia and the potential for an economic
slowdown. Ironically, this period was preceded by concerns in the first quarter
regarding an overzealous U.S. economy. I've taken steps to position the
Portfolio so that I believe it should perform regardless of economic changes.
An Opportunistic Strategy
I look to invest in great companies that often have three things in common:
strong management, a good business, and predictable earnings. I try to add value
by finding a catalyst that others might miss. Primarily, I invest in common
stocks and use their dividends for income. To manage risk, I also invest in
preferred stocks for higher yields and lower volatility. At times, I include
smaller positions in foreign securities and fixed-income instruments if market
conditions are appropriate.
Since the Portfolio's inception, I've added positions in approximately 60
stocks, with core weightings in media/entertainment, financial services,
pharmaceuticals, and technology. I believe these industries have bright future
economics, and, within them, I seek companies with top-flight management teams
focused on increasing shareholder value. At the same time, I steer clear of
businesses that are capital-intensive because of the limits this places on their
free cash flow.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998
Equities 90.3%
Number of Stocks 70
Top 10 Equities 26.0%
Fixed-Income Securities 1.4%
Cash & Cash Equivalents 8.3%
- --------------------------------------------------------------------------------
Industry Consolidation Emerges as a Theme
During the period, we witnessed several strategic mergers across a variety
of industries, starting with cable. I'm positive on the cable companies because
they are becoming less capital-intensive, their distribution capabilities are a
powerful force, and new, value-added services, such as data, video, and voice
offer higher profit margins. The subsequent AT&T/Tele-Communications, Inc.
merger highlighted these facts. As cable companies continue to gain critical
mass in individual markets, I believe this industry will consolidate further.
Two of our pharmaceutical holdings swept up in merger mania were American
Home Products and Monsanto. Their combined research, development, and marketing
budgets should help build what I believe will be a powerhouse in the
pharmaceutical, nutrition, and agriculture industries. Other drug stocks I
remain optimistic about include Warner-Lambert, Pfizer, and Bristol-Myers
Squibb, all of which posted solid results during the period.
Another sector that did well for the Portfolio was financial services. The
entire landscape of this industry appears to be undergoing dramatic change,
fueled, again, by consolidation. Among the many recent acquisition announcements
was NationsBank's proposal to buy BankAmerica, which is a sizable position in
the Portfolio. I'm confident the new company will have the preeminent
distribution platform in its industry from which a variety of financial services
will eventually be sold.
Although the Portfolio performed well overall, it was not without
disappointments, including CBS Corp. Although there were no fundamental reasons
for this stock to underperform, I suspect it was bruised by concerns regarding a
potential weakening in advertising sales. This was likely fostered by
speculation about an economic slowdown. However, second-quarter results for CBS
were better than expected; therefore, I held on to this position and look for it
to continue gaining strength.
Asia Keeps Global Economies in Check
Going forward, I don't expect the ride to get any smoother. Companies with
significant Asian exposure will likely see their earnings squeezed, and the
strong dollar could slow the pace of U.S. economic growth. Additionally, the
economic slowdown in Asia appears to have reduced the recent heady pace of the
U.S. expansion and has helped keep global commodity prices in check. With
technological innovation and productivity gains helping to offset wage
pressures, the risks of inflation seem negligible, and interest rates remain
low.
In terms of the Portfolio, I remain confident in the quality of our
companies, and our research continues to uncover exciting new ideas. I continue
to look hard at each and every stock, weighing the fundamentals and sticking by
companies with strong management, a compelling business, and predictable
earnings.
Thank you again for your investment in Janus Aspen Growth and Income
Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 29
<PAGE>
JANUS ASPEN GROWTH AND INCOME PORTFOLIO Portfolio Manager, David J. Corkins
- --------------------------------------------------------------------------------
Cumulative Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 5/1/98)
From Inception 5.60%
- --------------------------------------------------------------------------------
S&P 500 Index
From Inception Date of Institutional Shares 2.27%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/98)
From Inception 5.50%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
JANUS ASPEN GROWTH AND INCOME PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Common Stock - 84.4%
- --------------------------------------------------------------------------------
Advertising Sales - 1.3%
787 Outdoor Systems, Inc.* $ 22,036
- --------------------------------------------------------------------------------
Agricultural Biotechnology - 0.8%
235 Monsanto Co. 13,130
- --------------------------------------------------------------------------------
Agricultural Operations - 0.8%
300 Delta and Pine Land Co. 13,350
- --------------------------------------------------------------------------------
Airlines - 0.9%
200 UAL Corp.* 15,600
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 2.4%
485 Ford Motor Co. 28,615
221 Renault S.A. 12,570
- --------------------------------------------------------------------------------
41,185
- --------------------------------------------------------------------------------
Beverages - Non-Alcoholic - 1.4%
600 Coca-Cola Enterprises, Inc. 23,550
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.9%
400 Tele-Communications Liberty Media
Group, Inc., - Class A* 15,525
- --------------------------------------------------------------------------------
Cable Television - 7.4%
1,195 Comcast Corp. - Special Class A 48,509
450 Cox Communications, Inc. - Class A* 21,797
500 MediaOne Group, Inc.* 21,968
865 Tele-Communications, Inc. - Class A* 33,248
- --------------------------------------------------------------------------------
125,522
- --------------------------------------------------------------------------------
Cellular Telecommunications - 0.9%
2,165 Telecom Italia S.p.A. 15,818
- --------------------------------------------------------------------------------
Chemicals - Diversified - 3.4%
365 E.I. du Pont de Nemours and Co. 27,238
125 Imperial Chemical Industries PLC (ADR) 8,062
800 Solutia, Inc. 22,950
- --------------------------------------------------------------------------------
58,250
- --------------------------------------------------------------------------------
Chemicals - Specialty - 0.5%
210 Cytec Industries, Inc.* 9,292
- --------------------------------------------------------------------------------
Commercial Banks - 1.3%
345 Star Banc Corp. 22,036
- --------------------------------------------------------------------------------
Computer Software - 5.2%
880 Cadence Design Systems, Inc.* $ 27,500
400 Microsoft Corp.* 43,350
650 Parametric Technology Co.* 17,631
- --------------------------------------------------------------------------------
88,481
- --------------------------------------------------------------------------------
Computers - Micro - 2.7%
500 Dell Computer Corp.* 46,406
- --------------------------------------------------------------------------------
Cruise Lines - 2.7%
250 Carnival Corp. - Class A 9,906
450 Royal Caribbean Cruises, Ltd. 35,775
- --------------------------------------------------------------------------------
45,681
- --------------------------------------------------------------------------------
Diversified Financial Services - 1.6%
350 Associates First Capital Corp. - Class A 26,906
- --------------------------------------------------------------------------------
Diversified Operations - 7.8%
1,300 CBS Corp. 41,275
500 General Electric Co. 45,500
255 Textron, Inc. 18,280
450 Tyco International, Ltd. 28,350
- --------------------------------------------------------------------------------
133,405
- --------------------------------------------------------------------------------
Electronic Components - Semiconductors - 1.7%
250 Applied Materials, Inc. 7,375
80 Intel Corp. 5,930
500 Maxim Integrated Products, Inc. 15,843
- --------------------------------------------------------------------------------
29,148
- --------------------------------------------------------------------------------
Finance - Consumer Loans - 2.5%
865 Household International, Inc. 43,034
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 3.1%
500 Charles Schwab Corp. 16,250
75 Merrill Lynch & Co., Inc. 6,919
315 Morgan Stanley, Dean Witter, Discover and Co. 28,783
- --------------------------------------------------------------------------------
51,952
- --------------------------------------------------------------------------------
Finance - Mortgage Loan Banker - 0.9%
250 Fannie Mae 15,188
- --------------------------------------------------------------------------------
Finance - Other Services - 2.3%
775 Newcourt Credit Group, Inc. - New York Shares 38,120
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 30
<PAGE>
JANUS ASPEN GROWTH AND INCOME PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Internet Content - 0.1%
40 At Home Corp. - Class A* $ 1,893
- --------------------------------------------------------------------------------
Internet Software - 1.3%
200 America Online, Inc. 21,200
- --------------------------------------------------------------------------------
Investment Management and Advisory Services- 0.7%
500 Waddell & Reed Financial, Inc. - Class A 11,969
- --------------------------------------------------------------------------------
Medical - Drugs - 9.7%
145 American Home Products Corp. 7,504
729 Astra A.B. - Class A 14,900
250 Bristol-Myers Squibb Co. 28,734
300 Eli Lilly and Co. 19,819
350 Pfizer, Inc. 38,041
400 Pharmacia & Upjohn, Inc. 18,450
550 Warner-Lambert Co. 38,156
- --------------------------------------------------------------------------------
165,604
- --------------------------------------------------------------------------------
Money Center Banks - 4.1%
500 BankAmerica Corp. 43,219
175 Citicorp 26,119
- --------------------------------------------------------------------------------
69,338
- --------------------------------------------------------------------------------
Multimedia - 3.2%
550 Time Warner, Inc. 46,991
70 Walt Disney Co. (The) 7,354
- --------------------------------------------------------------------------------
54,345
- --------------------------------------------------------------------------------
Networking Products - 2.7%
505 Cisco Systems, Inc.* 46,492
- --------------------------------------------------------------------------------
Pharmacy Services - 0.7%
300 Omnicare, Inc. 11,438
- --------------------------------------------------------------------------------
Property and Casualty Insurance - 0.6%
200 Allied Group, Inc. 9,363
- --------------------------------------------------------------------------------
Radio - 0.9%
100 Chancellor Media Corp.* 4,966
225 Heftel Broadcasting Corp. - Class A* 10,069
- --------------------------------------------------------------------------------
15,035
- --------------------------------------------------------------------------------
Retail - Discount - 1.3%
360 Costco Companies, Inc.* 22,703
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 1.1%
450 Fred Meyer, Inc.* 19,125
- --------------------------------------------------------------------------------
Super - Regional Banks - 2.6%
100 Mellon Bank Corp. 6,963
875 U.S. Bancorp 37,625
- --------------------------------------------------------------------------------
44,588
- --------------------------------------------------------------------------------
Telecommunication Equipment - 0.5%
100 Lucent Technologies, Inc. 8,319
- --------------------------------------------------------------------------------
Telecommunication Services - 0.4%
450 Hyperion Telecommunications, Inc. - Class A* 7,059
- --------------------------------------------------------------------------------
Telephone - Long Distance - 2.0%
695 WorldCom, Inc.* 33,664
- --------------------------------------------------------------------------------
Total Common Stock (cost $1,365,527) 1,435,750
- --------------------------------------------------------------------------------
Corporate Bonds - 1.4%
- --------------------------------------------------------------------------------
Cable Television - 0.1%
$ 1,000 Mediacom L.L.C., 8.50%
senior notes, due 4/15/08+ 998
- --------------------------------------------------------------------------------
Distributions and Wholesale - 0.4%
8,000 Aviation Sales Co., 8.125%
senior subordinated notes, due 2/15/08 7,820
- --------------------------------------------------------------------------------
Retail - Leisure Products - 0.3%
5,000 Selmer Co., Inc., 11.00%
senior subordinated notes, due 5/15/05 5,438
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 0.4%
$ 7,000 Fred Meyer, Inc., 7.45%
senior notes, due 3/1/08 $ 7,026
- --------------------------------------------------------------------------------
Telecommunication Services - 0.2%
3,000 Level 3 Communications, Inc., 9.125%
senior notes, due 5/1/08 2,918
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $24,157) 24,200
- --------------------------------------------------------------------------------
Preferred Stock - 5.9%
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 0.2%
1 Porsche A.G. 2,881
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 2.7%
628 Federal-Mogul Financial Trust, 7.00%+ 46,629
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.2%
17 TCI Pacific Communications, 5.00% 3,586
- --------------------------------------------------------------------------------
Cable Television - 0.4%
98 Houston Industries, Inc., 7.00% 7,301
- --------------------------------------------------------------------------------
Radio - 1.0%
165 Chancellor Media Corp., $3.00 16,913
- --------------------------------------------------------------------------------
Telephone - Local - 1.4%
265 MediaOne Group, Inc., 4.50% 23,833
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $93,813) 101,143
- --------------------------------------------------------------------------------
U.S. Government Agency - 11.8%
Fannie Mae
$ 200,000 5.85%, 7/1/98 (amortized cost $200,000) 200,000
- --------------------------------------------------------------------------------
Total Investments (total cost $1,683,497) - 103.5% 1,761,093
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (3.5%) (59,338)
- --------------------------------------------------------------------------------
Net Assets - 100% $ 1,701,755
- --------------------------------------------------------------------------------
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Canada 2.2% $ 38,120
Germany 0.2% 2,881
France 0.7% 12,570
Italy 0.9% 15,818
Sweden 0.8% 14,900
United Kingdom 0.5% 8,063
United States++ 94.7% 1,668,741
- --------------------------------------------------------------------------------
Total 100.0% $ 1,761,093
================================================================================
++Includes Short-Term Securities (83.4% excluding Short-Term Securities)
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 31
<PAGE>
JANUS ASPEN FLEXIBLE INCOME PORTFOLIO Portfolio Manager, Ronald V. Speaker
During the six months ended June 30, 1998, Janus Aspen Flexible Income
Portfolio outperformed the Lehman Brothers Government/Corporate Bond Index,
returning 5.57% for its Institutional Shares and 5.32% for its Retirement
Shares. This compares with a gain of 4.17% for the Index. All returns include
reinvested dividends. The average annual total returns for the period ended June
30, 1998, follow on the next page.
Events Divide Period as Volatility Persists
During the first half of the year, the bond market transitioned through two
distinct periods. Initially, the U.S. economy continued to grow, unemployment
declined, and the stock market soared. And although interest rates were level
throughout the first quarter, the magnitude of economic growth produced fears of
a rate increase. At the same time, because the Asian crisis appeared to have had
a minimal effect on the U.S. economy, concerns about the Far East seemed to
fade.
The tide changed in the second quarter as "chapter two" of the Asian
financial crisis began to unfold with several larger multinational companies
releasing earnings warnings. However, the reemergence of problems in the Far
East allowed the Federal Reserve Board to hold the line on raising interest
rates, despite its earlier warnings of an increase. Additionally, a sharp
decline in the yen renewed worries of further currency devaluations throughout
Asia and prompted a flight to U.S. Treasuries. The resulting influx of capital
allowed domestic interest rates to trend considerably lower.
Diversification Key to Success
Despite the volatile environment, I held true to my investment discipline
and pursued a diversified approach. While the Portfolio continued to invest in
Treasuries and maintained a substantial weighting in high-yield bonds, I
reallocated some of these assets to investment-grade corporate bonds. Through
this flexible mix, and as interest rates declined and bond prices rose, we were
able to maximize yield, diversify risk, and generate significant capital gains.
Our biggest winner during the first half was U.S. Surgical. After reading
U.S. Surgical's prospectus and listening to a conference call with the company's
management team, many investors bought this bond, which at that time possessed
both high-yield and investment-grade characteristics. However, I was interested
in learning more about the company and consequently visited one of its
subsidiaries. While touring the factory, I noticed performance charts, posted
for the benefit of employees, that revealed the company was currently exceeding
management's expectations. This confirmation of U.S. Surgical's success aided in
my decision to invest in this bond. Since then, we've benefited from the bond's
improved quality, resulting from its merger with Tyco International, which has a
higher credit rating than U.S. Surgical.
Another development that benefited the Portfolio was the merger of AT&T and
Tele-Communications, Inc., one of our largest positions in the corporate bond
arena. I believe this union has caused investors to acknowledge the prospects
for cash flow growth in the cable industry and the expanding opportunities for
providing new value-added services through a single coaxial cable.
On the high-yield front, several new names were added helping to boost
income and capital appreciation. These include Bally Total Fitness, the nation's
largest owner of fitness centers, and Jones Intercable, which increased our
exposure to the cable industry. Also new to our high-yield position was Magnum
Hunter Resources, an oil and gas exploration and production company whose bond
we purchased because of the company's solid acquisition prospects.
Although I was generally pleased with the Portfolio's results, not all of
our ideas contributed to its strong performance. Metricom, a convertible bond,
tested my patience despite the fact that the company has patented technology
that provides computers with a wireless connection to the Internet, and is
currently testing a faster modem that will run at ISDN line speeds. Although
this bond recently experienced some volatility, I'm holding the position in
anticipation of a successful introduction and acceptance of the system next
year.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Investment-Grade Corporate Bonds 33.6% 26.9%
High-Yield/High-Risk Bonds 37.6% 39.9%
U.S. Government Obligations 15.4% 20.9%
Preferred Stock 1.0% 0.6%
Cash & Cash Equivalents 12.4% 11.7%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Portfolio Profile
Weighted Average Maturity 9.4 Yrs. 9.2 Yrs.
Average Modified Duration* 5.8 Yrs. 5.8 Yrs.
30-Day Average Yield
Institutional Shares** 6.87% 6.85%
Retirement Shares** 6.32% 6.32%
Average Rating BBB- BBB+
- --------------------------------------------------------------------------------
*A theoretical measure of price volatility.
**Yields will fluctuate.
Potential For a Slowing Economy
Currently, the bond market is evaluating whether the robust U.S. economic
expansion can continue into the foreseeable future. I believe that economic
growth will slow from its torrid pace during the first half of the year because
of renewed problems in Asia, concerns regarding corporate profits, and the
effects of the General Motors strike. However, I'm confident our strong
weightings in investment-grade bonds will prove beneficial in the event the
economy does weaken. Going forward, I plan to maintain our diversified approach
and to take advantage of potential opportunities, wherever they may present
themselves.
Thank you for your continued investment in Janus Aspen Flexible Income
Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 32
<PAGE>
JANUS ASPEN FLEXIBLE INCOME PORTFOLIO Portfolio Manager, Ronald V. Speaker
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 9/13/93)
1 Year 13.07%
From Inception 10.20%
- --------------------------------------------------------------------------------
Lehman Brothers Govt./Corp. Bond Index
1 Year 11.28%
From Inception Date of Institutional Shares 6.54%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 12.42%
From Inception 13.20%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. Past performance does not guarantee
future results.
JANUS ASPEN FLEXIBLE INCOME PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Principal Amount Market Value
- --------------------------------------------------------------------------------
Corporate Bonds - 71.1%
- --------------------------------------------------------------------------------
Automotive - Cars and Light Trucks - 1.3%
$ 1,000,000 Ford Motor Co., 7.25%
notes, due 10/1/08 $ 1,075,000
- --------------------------------------------------------------------------------
Beverages - Non-Alcoholic - 1.9%
1,500,000 Coca-Cola Enterprises, Inc., 6.95%
debentures, due 11/15/26 1,561,875
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.6%
500,000 Fox/Liberty Networks L.L.C., 8.875%
senior notes, due 8/15/07 506,250
- --------------------------------------------------------------------------------
Cable Television - 3.7%
500,000 Century Communications Corp., 8.375%
senior notes, due 12/15/07 515,000
500,000 Galaxy Telecom, L.P., 12.375%
senior subordinated notes, due 10/1/05 556,250
500,000 Jones Intercable, Inc., 7.625%
senior notes, due 4/15/08 507,500
500,000 Supercanal Holdings S.A., 11.50%
senior notes, due 5/15/05+ 477,500
1,000,000 TCI Communications, Inc., 6.875%
senior notes, due 2/15/06 1,032,500
- --------------------------------------------------------------------------------
3,088,750
- --------------------------------------------------------------------------------
Casino Hotels - 0.9%
750,000 Venetian Casino Resort L.L.C., 12.25%
company guaranteed notes, due 11/15/04 774,375
- --------------------------------------------------------------------------------
Casino Services - 0.6%
500,000 Isle of Capri Black Hawk, L.L.C., 13.00%
first mortgage bonds, due 8/31/04 527,500
- --------------------------------------------------------------------------------
Cellular Telecommunications - 2.6%
1,250,000 360 Communications Co., 6.65%
notes, due 1/15/08 1,262,500
870,000 American Cellular Corp., 10.50%
senior notes, due 5/15/08+ 865,650
- --------------------------------------------------------------------------------
2,128,150
- --------------------------------------------------------------------------------
Chemicals - Specialty - 0.5%
350,000 Praxair, Inc., 6.625%
notes, due 10/15/07 356,125
- --------------------------------------------------------------------------------
Commercial Banks - 7.1%
$ 1,000,000 Bank One Texas, 6.25%
subordinated notes, due 2/15/08 $ 995,000
1,250,000 BankBoston N.A., 6.375%
subordinated notes, due 3/25/08 1,250,000
735,000 First Nationwide Holdings, Inc., 10.625%
senior subordinated notes, due 10/1/03 832,388
700,000 HUBCO, Inc., 8.20%
subordinated debentures, due 9/15/06 764,750
1,000,000 NationsBank Corp., 6.60%
subordinated notes, due 5/15/10 1,022,500
1,000,000 Provident Trust I, 8.29%
company guaranteed notes, due 4/15/28 1,051,250
- --------------------------------------------------------------------------------
5,915,888
- --------------------------------------------------------------------------------
Computers - Integrated Systems - 0.6%
500,000 Candescent Technologies Corp., 7.00%
senior subordinated debentures, due 5/1/03 500,000
- --------------------------------------------------------------------------------
Computers - Mainframe - 1.9%
IBM Corp.:
500,000 6.45% notes, due 8/1/07 513,750
1,000,000 7.00% debentures, due 10/30/25 1,068,750
- --------------------------------------------------------------------------------
1,582,500
- --------------------------------------------------------------------------------
Consumer Products - 0.4%
450,000 Spin Cycle, Inc., zero coupon
units, due 5/1/05+ 321,750
- --------------------------------------------------------------------------------
Containers - Metal and Glass - 0.6%
500,000 Crown Cork & Seal Co., Inc., 7.00%
company guaranteed notes, due 12/15/06 518,125
- --------------------------------------------------------------------------------
Distribution and Wholesale - 0.5%
445,000 Aviation Sales Co., 8.125%
senior subordinated notes, due 2/15/08 434,988
- --------------------------------------------------------------------------------
Electric - Integrated - 0.8%
600,000 El Paso Electric Co., 9.40%
first mortgage bonds, due 5/1/11 682,500
- --------------------------------------------------------------------------------
Engineering - Research and Development - 0.6%
500,000 Intertek Finance PLC, 10.25%
company guaranteed notes, due 11/1/06 530,000
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 33
<PAGE>
JANUS ASPEN FLEXIBLE INCOME PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Principal Amount Market Value
- --------------------------------------------------------------------------------
Finance - Auto Loans - 1.5%
$ 1,250,000 General Motors Acceptance Corp., 6.125%
senior subordinated notes, due 1/22/08 $ 1,228,125
- --------------------------------------------------------------------------------
Finance - Other Services - 2.5%
2,000,000 Mellon Financial Co., 6.375%
subordinated notes, due 2/15/10 1,995,000
- --------------------------------------------------------------------------------
Food - Diversified - 1.0%
750,000 Ralston-Ralston Purina Group, 7.875%
debentures, due 6/15/25 860,625
- --------------------------------------------------------------------------------
Food - Retail - 1.6%
250,000 Disco S.A., 9.875%
notes, due 5/15/08 236,250
910,000 Pantry, Inc., 10.25%
company guaranteed notes, due 10/15/07 925,925
150,000 Star Markets Co., Inc., 13.00%
senior subordinated notes, due 11/1/04 168,750
- --------------------------------------------------------------------------------
1,330,925
- --------------------------------------------------------------------------------
Funeral Services and Related Items - 1.2%
750,000 Loewen Group, Inc., 7.60%
notes, due 6/1/08+ 751,875
250,000 Service Corporation International, 7.70%
notes, due 4/15/09 274,375
- --------------------------------------------------------------------------------
1,026,250
- --------------------------------------------------------------------------------
Home Furnishings - 1.1%
450,000 Cort Furniture Rental, 12.00%
senior notes, due 9/1/00 488,250
390,000 Lifestyle Furnishings International, Inc.,
10.875%, company guaranteed notes,
due 8/1/06 435,337
- --------------------------------------------------------------------------------
923,587
- --------------------------------------------------------------------------------
Industrial Audio and Video Products - 0.1%
100,000 Unifrax Investment Corp., 10.50%
senior notes, due 11/1/03 104,500
- --------------------------------------------------------------------------------
Insurance Brokers - 0.6%
500,000 SIG Capital Trust I, 9.50%
company guaranteed notes, due 8/15/27 512,500
- --------------------------------------------------------------------------------
Life and Health Insurance - 1.1%
742,000 Delphi Financial Group, Inc., 8.00%
senior notes, due 10/1/03 775,390
120,000 Penncorp Financial Group, Inc., 9.25%
senior subordinated notes, due 12/15/03 125,550
- --------------------------------------------------------------------------------
900,940
- --------------------------------------------------------------------------------
Manufacturing - 0.7%
500,000 Day International Group, Inc., 11.125%
senior notes, due 6/1/05 554,375
- --------------------------------------------------------------------------------
Medical - Hospitals - 1.7%
Columbia/HCA Healthcare Corp.:
1,300,000 7.19%, debentures, due 11/15/15 1,223,625
235,000 7.05%, debentures, due 12/01/27 206,800
- --------------------------------------------------------------------------------
1,430,425
- --------------------------------------------------------------------------------
Medical Instruments - 0.6%
500,000 United States Surgical Corp., 7.25%
senior notes, due 3/15/08 528,750
- --------------------------------------------------------------------------------
Medical Nursing Home - 0.6%
500,000 Extendicare Health Services, Inc., 9.35%
company guaranteed notes, due 12/15/07 513,750
- --------------------------------------------------------------------------------
Medical Products - 0.3%
250,000 ALARIS Medical, Inc., 9.75%
company guaranteed notes, due 12/1/06 260,625
- --------------------------------------------------------------------------------
Money Center Banks - 1.3%
$ 1,000,000 Chase Manhattan Corp., 6.75%
subordinated notes, due 8/15/08 $ 1,031,250
- --------------------------------------------------------------------------------
Multimedia - 4.1%
250,000 News America Holdings, Inc., 7.70%
debentures, due 10/30/25+ 266,875
Time Warner, Inc.:
1,000,000 8.18%, notes, due 8/15/07 1,110,000
1,000,000 6.95%, company guaranteed notes,
due 1/15/28 1,010,000
1,000,000 Walt Disney Co. (The), 6.75%
senior notes, due 3/30/06 1,043,750
- --------------------------------------------------------------------------------
3,430,625
- --------------------------------------------------------------------------------
Music/Clubs - 0.6%
880,000 V2 Music Holdings PLC, 14.00%
units, due 4/15/08* 457,600
- --------------------------------------------------------------------------------
Networking Products - 0.6%
500,000 Anixter International, Inc., 8.00%
company guaranteed notes, due 9/15/03 530,000
- --------------------------------------------------------------------------------
Office Automation and Equipment - 0.6%
500,000 Dictaphone Corp., 11.75%
senior subordinated notes, due 8/1/05 506,250
- --------------------------------------------------------------------------------
Oil Companies - Exploration and Production - 1.9%
1,557,000 Magnum Hunter Resources, Inc., 10.00%
company guaranteed notes, due 6/1/07 1,595,925
- --------------------------------------------------------------------------------
Paint and Related Products - 0.6%
500,000 Sherwin-Williams Co., 6.85%
notes, due 2/1/07 525,625
- --------------------------------------------------------------------------------
Physical Therapy and Rehabilitation Centers - 0.9%
750,000 HEALTHSOUTH Corp., 7.00%
senior notes, due 6/15/08 747,187
- --------------------------------------------------------------------------------
Property and Casualty Insurance - 1.1%
500,000 First American Capital Trust, 8.50%
company guaranteed notes, due 4/15/12 559,375
350,000 Orion Capital Corp., 7.25%
senior notes, due 7/15/05 366,625
- --------------------------------------------------------------------------------
926,000
- --------------------------------------------------------------------------------
Recreational Centers - 1.6%
1,250,000 Bally Total Fitness Holding Corp., 9.875%
senior subordinated notes, due 10/15/07 1,287,500
- --------------------------------------------------------------------------------
Reinsurance - 0.6%
500,000 Veritas Capital Trust, 10.00%
company guaranteed notes, due 1/1/28 523,750
- --------------------------------------------------------------------------------
Rental Auto/Equipment - 1.1%
750,000 Ryder TRS, Inc., 10.00%
senior subordinated notes, due 12/1/06 870,000
- --------------------------------------------------------------------------------
Retail - Internet - 0.4%
500,000 Amazon.com, Inc., zero coupon
senior discount notes, due 5/1/08 304,375
- --------------------------------------------------------------------------------
Retail - Leisure Products - 0.2%
150,000 Selmer Co., Inc., 11.00%
senior subordinated notes, due 5/15/05 163,125
- --------------------------------------------------------------------------------
Retail - Music Store - 0.7%
Musicland Group, Inc.:
370,000 9.00%, senior subordinated notes,
due 6/15/03 356,125
200,000 9.875%, company guaranteed notes,
due 3/15/08 199,000
- --------------------------------------------------------------------------------
555,125
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 34
<PAGE>
JANUS ASPEN FLEXIBLE INCOME PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 2.4%
$ 2,000,000 Fred Meyer, Inc., 7.45%
senior notes, due 3/1/08 $ 2,007,500
- --------------------------------------------------------------------------------
Retail - Restaurants - 2.1%
250,000 ROMACORP, Inc., 12.00%
senior notes, due 7/1/06+ 250,000
1,500,000 McDonald's Corp., 6.375%
debentures, due 1/8/28 1,515,000
- --------------------------------------------------------------------------------
1,765,000
- --------------------------------------------------------------------------------
Satellite Telecommunications - 2.2%
575,000 American Mobile Satellite Corp., 12.25%
units, due 4/1/08 546,250
250,000 Digital Television Services, L.L.C., 12.50%
company guaranteed notes, due 8/1/07 285,625
500,000 Innova S. de R.L., 12.875%
senior notes, due 4/1/07 506,250
500,000 PanAmSat Corp., 6.375%
notes, due 1/15/08+ 500,625
- --------------------------------------------------------------------------------
1,838,750
- --------------------------------------------------------------------------------
Savings/Loan/Thrifts - 2.2%
1,650,000 Local Financial Corp., 11.00%
senior notes, due 9/8/04 1,810,875
- --------------------------------------------------------------------------------
Steel - Producers - 0.7%
500,000 Weirton Steel Corp., 11.375%
senior notes, due 7/1/04 536,250
- --------------------------------------------------------------------------------
Telecommunication Equipment - 0.6%
500,000 Global Tele-Systems, Ltd., 9.875%
senior notes, due 2/15/05 515,625
- --------------------------------------------------------------------------------
Telecommunication Services - 2.1%
380,000 McLeodusa, Inc., 8.375%
senior notes, due 3/15/08 380,950
750,000 Metricom, Inc. 8.00%
subordinated notes, due 9/15/03 729,375
600,000 Talton Holdings, Inc., 11.00%
company guaranteed notes, due 6/30/07 646,500
- --------------------------------------------------------------------------------
1,756,825
- --------------------------------------------------------------------------------
Telephone - Integrated - 1.4%
300,000 Dobson Wireline Co., 12.250%
senior notes, due 6/15/08 291,750
1,000,000 Intermedia Communications, Inc., zero coupon
senior discount notes, due 5/15/06 822,500
- --------------------------------------------------------------------------------
1,114,250
- --------------------------------------------------------------------------------
Telephone - Long Distance - 1.3%
1,000,000 WorldCom, Inc., 7.75%
notes, due 4/1/07 1,083,750
- --------------------------------------------------------------------------------
Television - 0.3%
50,000 Dialog Corp. PLC, 11.00%
senior subordinated notes, due 11/15/07 55,250
150,000 Pegasus Media Communications, 12.50%
notes, due 7/1/05 169,500
- --------------------------------------------------------------------------------
224,750
- --------------------------------------------------------------------------------
Tools - Hand Held - 0.3%
250,000 Simonds Industries, Inc., 10.25%
senior subordinated notes, due 7/1/08 250,000
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $57,486,851) 59,032,065
- --------------------------------------------------------------------------------
U.S. Government Obligations - 15.4%
U.S. Treasury Notes:
1,000,000 5.50%, due 5/31/03 999,300
10,000,000 6.125%, due 8/15/07 10,400,200
1,400,000 5.625%, due 5/15/08 1,418,578
- --------------------------------------------------------------------------------
Total U.S. Government Obligations (cost $12,744,705) 12,818,078
- --------------------------------------------------------------------------------
Foreign Bonds - 0.1%
- --------------------------------------------------------------------------------
DEM 200,000 Esprit Telecom Group PLC, 11.00%
senior notes, due 6/15/08 (cost $111,798) $ 109,970
- --------------------------------------------------------------------------------
Preferred Stocks - 1.0%
- --------------------------------------------------------------------------------
Cable Television - 0.2%
2,500 Houston Industries, Inc., 7.00% 186,250
- --------------------------------------------------------------------------------
Internet Software - 0.4%
300 Concentric Network Corp., 13.50%+ 303,750
- --------------------------------------------------------------------------------
Savings/Loan/Thrifts - 0.4%
10,000 Chevy Chase Savings, 13.00% 310,000
- --------------------------------------------------------------------------------
Total Preferred Stocks (cost $783,056) 800,000
- --------------------------------------------------------------------------------
Warrants - 0%
Gothic Energy Corp.:
2,621 exp. 1/23/03* 2,621
7,700 exp. 9/1/04* 7,700
- --------------------------------------------------------------------------------
Total Warrants (cost $0) 10,321
- --------------------------------------------------------------------------------
U.S. Government Agency - 9.7%
Freddie Mac
$ 8,000,000 5.85%, 7/1/98 (amortized cost $8,000,000) 8,000,000
- --------------------------------------------------------------------------------
Total Investments (total cost $79,126,410) - 97.3% 80,770,434
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 2.7% 2,203,531
- --------------------------------------------------------------------------------
Net Assets - 100% $ 82,973,965
- --------------------------------------------------------------------------------
Summary of Investments by Country
June 30, 1998
Country % of Investment Securities Market Value
- --------------------------------------------------------------------------------
Argentina 0.3% $ 236,250
Mexico 0.6% 506,250
United Kingdom 0.9% 695,220
United States++ 98.2% 79,332,714
- --------------------------------------------------------------------------------
Total 100.0% $ 80,770,434
================================================================================
++Includes Short-Term Securities (88.3% excluding Short-Term Securites)
Forward Currency Contracts
Open at June 30, 1998
Currency Sold and Currency Currency Unrealized
Settlement Date Units Sold Value in $ U.S. Gain/(Loss)
- --------------------------------------------------------------------------------
German Deutschemark 3/5/99 195,000 $ 109,366 $ 1,106
- --------------------------------------------------------------------------------
Total $ 109,366 $ 1,106
================================================================================
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 35
<PAGE>
JANUS ASPEN HIGH-YIELD PORTFOLIO Portfolio Manager, Sandy R. Rufenacht
The continuation of a strong U.S. economy provided a positive backdrop for
the high-yield bond market, and during the six-month period ended June 30, 1998,
Janus Aspen High-Yield Portfolio returned 6.74% for the Institutional Shares and
6.40% for the Retirement Shares. In comparison, the Lehman Brothers High Yield
Index gained 4.50%. All returns include reinvested dividends. The average annual
total returns for the period ended June 30, 1998, follow on the next page.
High-Yield Issuance Continues to Grow
A second round of financial turmoil in Asia kept interest rates at an
all-time low while the stock market soared. Because of the correlation between
the performance of high-yield securities and stocks, high-yield bonds benefited
from this environment; however, an excess of new high-yield issuance tempered
results for much of the segment. On the upside, the flood of new issuance
indicates more companies are turning to the high-yield market rather than stocks
to finance capital improvements and acquisitions.
The oversupply in high-yield bonds has prompted our investment team to dig
even deeper, with rigorous analysis based on extensive financial modeling and
on-site visits to nearly all of our holdings. Although we've uncovered a few new
ideas, we remain focused on the tried and true names that have a history of
proven performance.
Positioned to Move Full Steam Ahead
In terms of the Portfolio's construction, I think it's helpful to compare
it to a train. Approximately 15% of the Portfolio consists of what I refer to as
"locomotives." These are our more aggressive high-yield ideas, typically the
highest-risk names, with the best appreciation prospects and a generous coupon.
"Rail cars" make up the vast majority of the Portfolio. They generally move in
sync with the marketplace, and while they may not carry as much upside potential
as some of our more aggressive ideas, they allow us to clip a good coupon. The
remainder of the securities fall into the "caboose" section. These are bonds
that trade near their yield-to-call and offer limited downside risk and a solid
coupon. These three types of securities offer a diversified mix and competitive
yield to investors.
Our biggest success during the period was Ryder Trucks, a position we
purchased for its "rail car" qualities, but that more recently has evolved into
a "caboose." Ryder recently separated from its parent company and initiated a
series of enhancements to compete with its biggest rival in the rental truck
industry - U-Haul. Ryder reduced the size of its fleet and, through better
analysis of trends, made changes to improve the utilization of its trucks. To
that end, Ryder sold all of its rental trucks and then leased them back,
allowing management to improve its cash flows and repay some of its debt. The
transition to "caboose" came shortly thereafter when Budget Rental Trucks, a
perceived investment-grade rated company (no public debt), acquired Ryder. Soon
after, Budget commenced a tender offer at a substantial premium to where the
bond had been trading.
Another strong performer was Isle of Capri - a bond we consider to be a
"locomotive." This gaming company is currently building a large casino complex
in Blackhawk, Colorado. While gaming revenues in and around Blackhawk have
increased over the last several months, this market's full potential has yet to
be tapped. We also stand to benefit from favorable terms as a result of our
participation in the structuring of this deal, not to mention our proximity to
the casino. We believe this bond should continue to provide us with strong
upside potential which more than outweighs any downside risk.
While the Portfolio logged solid results, we did suffer a disappointment in
Hollywood Park Casinos, one of our largest positions. The bond declined upon the
market's unfavorable view of some recent acquisitions made by the company,
including its purchase of Casino Magic. However, I believe Hollywood Park is
currently misunderstood by the market and will likely exceed all second quarter
expectations. Going forward, it appears as though the acquisition of Casino
Magic will account for 50% of consolidated cash flow, further supporting the
company's bottom line. Hollywood Park is also shedding its poorly performing
racetrack business to focus on its core gaming business; therefore, I've decided
to maintain our holdings.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Weighted Average Maturity 7.2 Yrs. 6.8 Yrs.
Average Modified Duration* 5.0 Yrs. 4.5 Yrs.
30-Day Average Yield
Institutional Shares** 8.15% 8.10%
Without Reimbursement** 7.25% 7.04%
Retirement Shares** 7.60% 7.68%
Without Reimbursement** 6.71% 6.60%
Average Rating B B+
- --------------------------------------------------------------------------------
*A theoretical measure of price volatility.
** Yields will fluctuate.
Outlook Remains Positive
Looking ahead, I believe renewed concerns over economic problems in Asia
will keep inflation and interest rates in check. As a result, I remain
optimistic about the high-yield bond sector. Despite the fact that the sector
may suffer from the continuation of excessive high-yield issuance, I believe
we've addressed this situation by stepping up our stringent fundamental analysis
and increasing the number of on-site visits each month. With the prospect of a
continued strong equity market as a backdrop, the Portfolio is well positioned
going forward.
Thank you, as always, for your continued investment in Janus Aspen
High-Yield Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 36
<PAGE>
JANUS ASPEN HIGH-YIELD PORTFOLIO Portfolio Manager, Sandy R. Rufenacht
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 5/1/96)
1 Year 15.48%
From Inception 16.47%
- --------------------------------------------------------------------------------
Lehman Brothers High-Yield Bond Index
1 Year 11.36%
From Inception Date of Institutional Shares 12.33%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 14.92%
From Inception 16.19%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
JANUS ASPEN HIGH-YIELD PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Principal Amount Market Value
- --------------------------------------------------------------------------------
Corporate Bonds - 94.4%
- --------------------------------------------------------------------------------
Advertising Services - 3.3%
$ 27,000 Outsourcing Services Group, 10.875%
senior subordinated notes, due 3/1/06+ $ 27,540
100,000 Young America Corp., 11.625%
senior subordinated notes, due 2/15/06 99,000
- --------------------------------------------------------------------------------
126,540
- --------------------------------------------------------------------------------
Auto Repair Centers - 2.2%
85,000 Diamond Triumph Autoglass, Inc., 9.25%
senior notes, due 4/1/08 86,487
- --------------------------------------------------------------------------------
Automotive - Truck Parts and Equipment - 0.5%
20,000 J.H. Heafner Co., Inc., 10.00%
senior notes, due 5/15/08+ 20,350
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.4%
20,000 Fox/Liberty Networks, L.L.C., 9.75%
senior discount notes, due 8/15/07 13,925
- --------------------------------------------------------------------------------
Building - Heavy Construction - 1.2%
45,000 Iron Age Corp., 9.875%
senior subordinated notes, due 5/1/08 45,000
- --------------------------------------------------------------------------------
Building - Residential and Commercial - 0.7%
28,000 Toll Corp., 9.50%
senior subordinated notes, due 3/15/03 28,910
- --------------------------------------------------------------------------------
Building and Construction - 0.9%
35,000 Reliant Building Products, 10.875%
senior subordinated notes, due 5/1/04 35,175
- --------------------------------------------------------------------------------
Cable Television - 4.7%
75,000 Adelphia Communications Corp., 9.25%
senior notes, due 10/1/02 77,625
25,000 Fundy Cable, Ltd., 11.00%
senior notes, due 11/15/05 27,437
5,000 Galaxy Telecom, L.P., 12.375%
senior subordinated notes, due 10/1/05 5,562
20,000 Lenfest Communications, Inc., 8.25%
senior subordinated notes, due 2/15/08 20,850
40,000 Mediacom, L.L.C., 8.50%
senior notes, due 4/15/08+ 39,900
10,000 Rifkin Acquisition Partners, L.P., 11.125%
senior subordinated notes, due 1/15/06 11,025
- --------------------------------------------------------------------------------
182,399
- --------------------------------------------------------------------------------
Casino Hotels - 1.0%
$ 15,000 Trump Atlantic City Associates, 11.25%
company guaranteed notes, due 5/1/06 $ 14,587
25,000 Venetian Casino Resort, L.L.C., 12.25%
mortgage bonds, due 11/15/04 25,812
- --------------------------------------------------------------------------------
40,399
- --------------------------------------------------------------------------------
Casino Services - 1.3%
50,000 Isle of Capri Blackhawk, L.L.C., 13.00%
first mortgage bonds, due 8/31/04 52,750
- --------------------------------------------------------------------------------
Cellular Telecommunications - 2.9%
100,000 Nextel Communications, Inc., zero coupon
senior discount notes, due 8/15/04 97,500
25,000 Telesystem International Wireless, Inc.,
zero coupon senior discount notes,
due 11/1/07 15,031
- --------------------------------------------------------------------------------
112,531
- --------------------------------------------------------------------------------
Circuit Boards - 0.6%
25,000 Details, Inc., 10.00%
senior subordinated notes, due 11/15/05 25,250
- --------------------------------------------------------------------------------
Coal - 1.0%
20,000 Lodestar Holdings, Inc., 11.50%
senior notes, due 5/15/05 20,175
20,000 P&L Coal Holdings Corp., 9.625%
senior subordinated notes, due 5/15/08+ 20,550
- --------------------------------------------------------------------------------
40,725
- --------------------------------------------------------------------------------
Consumer Products - 0.3%
20,000 Diamond Brands, Inc., 12.875%
debentures, due 4/15/09+ 10,775
- --------------------------------------------------------------------------------
Containers - Paper and Plastic - 1.0%
35,000 Plastic Containers, Inc., 10.00%
senior notes, due 12/15/06 37,625
- --------------------------------------------------------------------------------
Distribution and Wholesale - 2.5%
100,000 Aviation Sales Co., 8.125%
senior subordinated notes, due 2/15/08 97,750
- --------------------------------------------------------------------------------
Educational Software - 1.1%
40,000 Herff Jones, Inc., 11.00%
senior subordinated notes, due 8/15/05 44,050
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 37
<PAGE>
JANUS ASPEN HIGH-YIELD PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Principal Amount Market Value
- --------------------------------------------------------------------------------
Engineering - Research and Development Services - 2.3%
CSC Holdings, Inc.:
$ 40,000 7.875%, senior notes, due 12/15/07 $ 42,316
45,000 8.125%, debentures, due 8/15/09 48,263
- --------------------------------------------------------------------------------
90,579
- --------------------------------------------------------------------------------
Engines - Internal Combustion - 0.5%
20,000 Wells Aluminum Corp., 10.125%
senior notes, due 6/1/05 21,100
- --------------------------------------------------------------------------------
Finance - Other Services - 0.3%
20 SF Holdings Group, Inc., zero coupon
units, due 3/15/08 11,000
- --------------------------------------------------------------------------------
Food - Diversified - 2.2%
85,000 Richmont Marketing Specialists, 10.125%
senior subordinated notes, due 12/15/07 86,594
- --------------------------------------------------------------------------------
Food - Retail - 4.5%
50,000 Eagle Family Foods, 8.75%
senior subordinated notes, due 01/15/08 48,687
75,000 Marsh Supermarkets, Inc., 8.875%
company guaranteed notes, due 8/1/07 76,687
45,000 Star Markets Co., Inc., 13.00%
senior subordinated notes, due 11/1/04 50,625
- --------------------------------------------------------------------------------
175,999
- --------------------------------------------------------------------------------
Funeral Services and Related Items - 0.4%
15,000 Prime Succession Acquisition Co., 10.75%
senior subordinated notes, due 8/15/04 16,425
- --------------------------------------------------------------------------------
Gambling - Non-Hotel Casinos - 1.4%
25,000 Casino America, Inc., 12.50%
senior notes, due 8/1/03 28,250
25,000 Lady Luck Gaming Corp., 11.875%
first mortgage notes, due 3/1/01 25,875
- --------------------------------------------------------------------------------
54,125
- --------------------------------------------------------------------------------
Home Decorating Products - 0.8%
32,000 Home Interiors & Gifts, Inc., 10.125%
senior subordinated notes, due 6/1/08 32,640
- --------------------------------------------------------------------------------
Home Furnishings - 0.6%
20,000 Cort Furniture Rental, 12.00%
senior notes, due 9/1/00 21,700
- --------------------------------------------------------------------------------
Hotels and Motels - 0.9%
35,000 Hard Rock Hotel, Inc., 9.25%
senior subordinated notes, due 4/1/05 35,700
- --------------------------------------------------------------------------------
Human Resources - 0.7%
25,000 COMFORCE Corp., 12.00%
senior notes, due 12/1/07 27,000
- --------------------------------------------------------------------------------
Instruments - Controls - 1.0%
35,000 Imo Industries, Inc., 11.75%
senior subordinated notes, due 5/1/06 39,463
- --------------------------------------------------------------------------------
Machinery - General Industrial - 1.1%
40,000 Fairfield Manufacturing Co., Inc., 11.375%
senior subordinated notes, due 7/1/01 41,750
- --------------------------------------------------------------------------------
Machinery - Print Trade - 0.7%
25,000 Goss Graphic Systems, Inc., 12.00%
senior subordinated notes, due 10/15/06 26,438
- --------------------------------------------------------------------------------
Manufacturing - 3.8%
Foamex International, Inc.:
80,000 13.50%, senior subordinated notes,
due 8/15/05+ 92,700
50,000 9.875%, company guaranteed notes,
due 6/15/07 54,125
- --------------------------------------------------------------------------------
146,825
- --------------------------------------------------------------------------------
Medical Products - 0.6%
$ 25,000 Universal Hospital Services, Inc., 10.25%
senior notes, due 3/1/08+ $ 25,000
- --------------------------------------------------------------------------------
Metal Processors and Fabricators - 1.1%
40,000 Hawk Corp, 10.25%
senior notes, due 12/1/03 42,900
- --------------------------------------------------------------------------------
Music/Clubs - 0.5%
40 V2 Music Holdings PLC, zero coupon
units, due 4/15/08 20,800
- --------------------------------------------------------------------------------
Networking Products - 0.5%
20,000 Exodus Communications, Inc., 11.25%
senior notes, due 7/1/08+ 20,025
- --------------------------------------------------------------------------------
Printing - Commercial - 0.9%
35,000 R.H. Donnelly, Inc., 9.125%
senior subordinated notes, due 6/1/08 35,613
- --------------------------------------------------------------------------------
Racetracks - 3.8%
144,000 Hollywood Park, Inc., 9.50%
senior subordinated notes, due 8/1/07 148,500
- --------------------------------------------------------------------------------
Radio - 1.7%
60,000 SFX Broadcasting, Inc., 10.75%
senior subordinated notes, due 5/15/06 66,675
- --------------------------------------------------------------------------------
Recreational Centers - 1.1%
40,000 Bally Total Fitness Holding Corp., 9.875%
senior subordinated notes, due 10/15/07 41,200
- --------------------------------------------------------------------------------
Reinsurance - 0.3%
10,000 Veritas Holdings GMBH, 9.625%
senior notes, due 12/15/03 10,638
- --------------------------------------------------------------------------------
Rental Auto/Equipment - 1.5%
50,000 Ryder TRS, Inc., 10.00%
senior subordinated notes, due 12/1/06 58,000
- --------------------------------------------------------------------------------
Retail - Convenience Stores - 0.5%
20,000 Core-Mark International, Inc., 11.375%
senior subordinated notes, due 9/15/03 21,275
- --------------------------------------------------------------------------------
Retail - Discount - 1.7%
50,000 Hills Stores Co., 12.50%
senior notes, due 7/1/03 49,750
15,000 Pamida Holdings Corp., 11.75%
senior subordinated notes, due 3/15/03 15,563
- --------------------------------------------------------------------------------
65,313
- --------------------------------------------------------------------------------
Retail - Diversified - 3.0%
Eye Care Centers of America, Inc.:
40,000 12.00%, senior notes, due 10/1/03 43,300
35,000 9.125%, senior subordinated notes,
due 5/1/08 34,563
40,000 Falcon Holding Group, 8.375%
debentures, due 4/15/10 40,100
- --------------------------------------------------------------------------------
117,963
- --------------------------------------------------------------------------------
Retail - Drug Store - 0.7%
25,000 Community Distributors, Inc., 10.25%
company guaranteed notes, due 10/15/04 25,750
- --------------------------------------------------------------------------------
Retail - Internet - 0.9%
60,000 Amazon.com, Inc., zero coupon
senior discount notes, due 5/1/08 36,525
- --------------------------------------------------------------------------------
Retail - Music Store - 1.3%
50,000 MTS, Inc., 9.375%
senior subordinated notes, due 5/1/05+ 49,313
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 2.1%
80,000 Fred Meyer, Inc., 7.45%
senior notes, due 3/1/08 80,300
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 38
<PAGE>
JANUS ASPEN HIGH-YIELD PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Shares or
Principal Amount Market Value
- --------------------------------------------------------------------------------
Satellite Telecommunications - 0.4%
$ 15 American Mobile Satellite Corp., 12.25%
units, due 4/1/08+ $ 14,250
- --------------------------------------------------------------------------------
Savings/Loan/Thrifts - 2.1%
75,000 Local Financial Corp., 11.00%
senior notes, due 9/8/04 82,313
- --------------------------------------------------------------------------------
Steel - Producers - 1.3%
Steel Heddle Group, Inc.:
20,000 10.625%, senior subordinated notes,
due 6/1/08+ 20,150
30,000 zero coupon, debentures, due 6/1/09+ 15,337
15,000 Weirton Steel Corp., 11.375%
senior notes, due 7/1/04 16,088
- --------------------------------------------------------------------------------
51,575
- --------------------------------------------------------------------------------
Telecommunication Services - 9.4%
60,000 21st Century Telecom Group, Inc., zero coupon
senior discount notes, due 2/15/08 33,825
50,000 IDT Corp., 8.75%
senior notes, due 2/15/06 48,562
20,000 IXC Communications, Inc., 9.00%
senior subordinated notes, due 4/15/08 19,950
73,000 Level 3 Communications, Inc., 9.125%
senior notes, due 5/1/08 70,992
60,000 Microcell Telecommunications, Inc., zero coupon
senior discount notes, due 6/1/06 29,700
40 Onepoint Communications Corp., 14.50%
units, due 6/1/08+ 38,400
10,000 Peoples Telephone Co., Inc., 12.25%
senior notes, due 7/15/02 10,525
60,000 Pinnacle Holdings, Inc., zero coupon
senior discount notes, due 3/15/08 39,300
20,000 SBA Communications Corp., 12.00%
senior discount notes, due 3/1/08+ 12,600
47,000 Telegroup, Inc., zero coupon
senior discount notes, due 11/1/04 37,130
45,000 Teligent, Inc., zero coupon
senior discount notes, due 3/1/08+ 24,806
- --------------------------------------------------------------------------------
365,790
- --------------------------------------------------------------------------------
Telephone - Integrated - 3.0%
25,000 Dobson Wireline Co., 12.25%
senior notes, due 6/15/08 24,312
Intermedia Communications, Inc.:
85,000 zero coupon, senior discount notes,
due 5/15/06 69,912
30,000 zero coupon, senior discount notes,
due 7/15/07 21,975
- --------------------------------------------------------------------------------
116,199
- --------------------------------------------------------------------------------
Telephone - Local - 1.0%
50,000 e.spire Communications, Inc., zero coupon
senior discount notes, due 4/1/06 39,625
- --------------------------------------------------------------------------------
Telephone - Long Distance - 2.0%
25,000 Esprit Telecom Group PLC, 11.50%
senior notes, due 12/15/07 25,750
50,000 Primus Telecommunications Group, Inc., 11.75%
senior notes, due 8/1/04 53,000
- --------------------------------------------------------------------------------
78,750
- --------------------------------------------------------------------------------
Television - 2.3%
50,000 Dialog Corp. PLC, 11.00%
senior subordinated notes, due 11/15/07 55,250
10,000 Price Communications Corp., 11.75%
senior subordinated notes, due 7/15/07 11,150
25,000 TV Bandeirantes, 12.875%
notes, due 5/15/06+ 21,563
- --------------------------------------------------------------------------------
87,963
- --------------------------------------------------------------------------------
Textile - Products - 0.5%
$ 20,000 Glenoit Corp., 11.00%
company guaranteed notes, due 4/15/07 $ 21,400
- --------------------------------------------------------------------------------
Transportation - Services - 0.8%
30,000 Atlantic Express, Inc., 10.75%
company guaranteed notes, due 2/1/04 31,950
- --------------------------------------------------------------------------------
Water - 2.0%
75,000 Sparkling Spring Water Group, 11.50%
senior subordinated notes, due 11/15/07 79,313
- --------------------------------------------------------------------------------
Wire and Cable Products - 0.6%
20,000 International Wire Group, Inc., 11.75%
senior subordinated notes, due 6/1/05 22,000
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $3,641,079) 3,684,897
- --------------------------------------------------------------------------------
Preferred Stock - 1.6%
- --------------------------------------------------------------------------------
Broadcast Services and Programming - 0.2%
1 Paxson Communications Corp., 13.25% 10,000
- --------------------------------------------------------------------------------
Engineering - Research and Development Services - 0.9%
520 CSC Holdings, Inc., 8.50% 33,249
- --------------------------------------------------------------------------------
Savings/Loan/Thrifts - 0.5%
600 Chevy Chase Savings, 13.00% 18,600
- --------------------------------------------------------------------------------
Total Preferred Stock (cost $60,137) 61,849
- --------------------------------------------------------------------------------
Warrants - 0.2%
Gothic Energy Corp.:
238 exp. 1/23/03* 238
700 exp. 9/1/04* 700
160 Microcell Telecommunications, Inc.
- exp. 6/1/06*,+ 4,000
50 Primus Telecommunications Group, Inc.
- exp. 8/1/04* 1,900
- --------------------------------------------------------------------------------
Total Warrants (cost $2,000) 6,838
- --------------------------------------------------------------------------------
U.S. Government Agency - 3.9%
Freddie Mac
$ 155,000 5.85%, 7/1/98 (amortized cost $155,000) 155,000
- --------------------------------------------------------------------------------
Total Investments (total cost $3,858,216) - 100.1% 3,908,584
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (0.1%) (5,311)
- --------------------------------------------------------------------------------
Net Assets - 100% $ 3,903,273
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 39
<PAGE>
JANUS ASPEN SHORT-TERM BOND PORTFOLIO Portfolio Manager, Sandy R. Rufenacht
For the six-month period ended June 30, 1998, Janus Aspen Short-Term Bond
Portfolio's Institutional Shares appreciated 2.78%, while its Retirement Shares
gained 2.56%. In comparison, the Lehman Brothers Government/Corporate 1-3 Year
Bond Index appreciated 3.03%. Both returns include reinvested dividends. The
average annual total returns for the period ended June 30,1998, follow on the
next page.
While the majority of our investments were solid, the Portfolio's
performance lagged its benchmark because of a substantial cash position
throughout the period. I allowed cash levels to build in anticipation of taking
advantage of selected opportunities during temporary downturns in the market.
Two Sides of the Asian Crisis
U.S. government debt again became the safe haven during the period as a
result of renewed economic turmoil in Asia. The continuing decline in the yen
was particularly unsettling and injected new volatility into Asian and domestic
stock markets, causing a flight to U.S. dollar-denominated assets. U.S.
Treasuries benefited the most from these developments, experiencing a brief but
significant rally before retreating upon the U.S. central bank's intervention to
strengthen the yen. As a result of this rally, the Portfolio's substantial
investment in Treasuries proved advantageous.
On the flip side, investment-grade corporate bonds, which also made up a
large portion of the Portfolio, lagged Treasuries during the first half.
Corporate bonds traded at their lowest prices in years relative to government
bonds as worries about profits, the impact of the Asian crisis, and a flood of
new issuance restrained this segment. However, because of their limited credit
risk, I remain optimistic about corporate bonds, particularly several of our
long-time holdings, including IBM Corp., Smith-Kline Beecham, and Hyatt
Equities.
Positioned for Flexibility
The Portfolio remains positioned for flexibility, allowing it to respond
quickly to changes in interest rates. We've accomplished this by holding a
sizable weighting in investment-grade bonds, along with Treasuries and cash
equivalents. We also maintained a relatively small weighting in high-yield
bonds, which involve slightly higher credit risk than investment-grade bonds but
offer more attractive yields. This position will remain small in preparation for
the future liquidation of the Portfolio.
- --------------------------------------------------------------------------------
Portfolio Asset Mix June 30, 1998 December 31, 1997
Investment-Grade Corp. Bonds 35.2% 82.5%
High-Yield/High-Risk Corp. Bonds 8.6% --
U.S. Government Obligations 40.6% --
Cash & Cash Equivalents 15.6% 17.5%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Portfolio Profile June 30, 1998 December 31, 1997
Weighted Average Maturity 2.2 Yrs. 1.9 Yrs.
Average Modified Duration* 1.9 Yrs. 1.6 Yrs.
30-day Average Yield
Institutional Shares** 5.62% 6.15%
Without Reimbursement** 5.19% 4.94%
Retirement Shares** 5.10% 5.57%
Without Reimbursement** 4.68% 4.36%
Average Rating A+ A+
- --------------------------------------------------------------------------------
*A theoretical measure of price volatility.
** Yields will fluctuate.
Possible Worldwide Economic Slowdown
My outlook for the bond market is stable to good. The inflationary
environment appears muted, and interest rates should remain low, kept in check
by continued financial pressures in Asia. I believe troubles in the Far East may
cause a worldwide slowdown and am beginning to see a lot of crossover-buying
into bonds as a result. After three years of strong stock market returns,
investors seem to be rediscovering the added safety of the bond market. Wherever
interest rates are headed, the Portfolio is positioned to respond quickly, and
the mix of securities should keep yields competitive.
In closing, I'd like to thank you for your continued investment in Janus
Aspen Short-Term Bond Portfolio.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 40
<PAGE>
JANUS ASPEN SHORT-TERM BOND PORTFOLIO Portfolio Manager, Sandy R. Rufenacht
- --------------------------------------------------------------------------------
Average Annual Total Return(1)
For the Periods Ended June 30, 1998
- --------------------------------------------------------------------------------
Institutional Shares (Inception Date 9/13/93)
1 Year 6.28%
From Inception 5.02%
- --------------------------------------------------------------------------------
Lehman Brothers Govt./Corp. 1-3 Year Bond Index
1 Year 6.79%
From Inception Date of Institutional Shares 5.66%
- --------------------------------------------------------------------------------
Retirement Shares (Inception Date 5/1/97)
1 Year 5.74%
From Inception 6.14%
- --------------------------------------------------------------------------------
(1) All returns reflect reinvested dividends. The Portfolio's securities may
differ significantly from the securities in the Index. Index returns do not
include taxes or dividends and interest payments or operating expenses
necessary to maintain a portfolio consisting of the same securities that are
in the Index. These returns do not reflect the charges and expenses of any
particular insurance product or qualified plan. Investment return and
principal value will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. The adviser voluntarily waives a
portion of the Portfolio's expenses. Without such waiver, the Portfolio's
total returns for each class would have been lower. Past performance does
not guarantee future results.
JANUS ASPEN SHORT-TERM BOND PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Principal Amount Market Value
- --------------------------------------------------------------------------------
Corporate Bonds - 43.8%
- --------------------------------------------------------------------------------
Building - Residential and Commercial - 0.5%
$ 21,000 Toll Corp., 9.50%
senior subordinated notes, due 3/15/03 $ 21,683
- --------------------------------------------------------------------------------
Computers - Mainframe - 4.7%
200,000 IBM Corp., 6.375%
global notes, due 6/15/00 202,000
- --------------------------------------------------------------------------------
Diversified Financial Services - 4.7%
100,000 Associates Corp. N.A., 5.85%
senior notes, due 1/15/01 99,750
100,000 Chrysler Financial Corp., 6.625%
notes, due 8/15/00 101,375
- --------------------------------------------------------------------------------
201,125
- --------------------------------------------------------------------------------
Finance - Auto Loans - 2.3%
100,000 Ford Motor Credit Co., 6.25%
notes, due 11/8/00 100,500
- --------------------------------------------------------------------------------
Finance - Investment Bankers/Brokers - 2.3%
100,000 Merrill Lynch & Co., Inc., 6.00%
notes, due 3/1/01 100,125
- --------------------------------------------------------------------------------
Hotels and Motels - 4.0%
65,000 Host Marriott Corp., 9.50%
senior notes, due 5/15/05 68,900
100,000 Hyatt Equities, L.L.C., 6.80%
notes, due 5/15/00+ 101,125
- --------------------------------------------------------------------------------
170,025
- --------------------------------------------------------------------------------
Machinery - General Industrial - 1.8%
75,000 Fairfield Manufacturing Co., Inc., 11.375%
senior subordinated notes, due 7/1/01 78,281
- --------------------------------------------------------------------------------
Manufacturing - 2.2%
80,000 Foamex L.P., 13.50%
senior subordinated notes, due 8/15/05+ 92,700
- --------------------------------------------------------------------------------
Medical - Drugs - 2.4%
100,000 SmithKline Beecham PLC, 6.75%
company guaranteed notes, due 10/30/01 102,375
- --------------------------------------------------------------------------------
Multimedia - 3.5%
150,000 Walt Disney Co. (The), 6.375%
senior notes, due 3/30/01 152,063
- --------------------------------------------------------------------------------
Paint and Related Products - 2.3%
$ 100,000 Sherwin-Williams Co., 6.25%
notes, due 2/1/00 $ 100,625
- --------------------------------------------------------------------------------
Pipelines - 2.3%
100,000 Enron Corp., 6.45%
notes, due 11/15/01 100,875
- --------------------------------------------------------------------------------
Retail - Discount - 4.7%
100,000 TJX Companies, Inc., 6.625%
notes, due 6/15/00 100,875
100,000 Woolworth Corp., 7.00%
notes, due 6/1/00 101,250
- --------------------------------------------------------------------------------
202,125
- --------------------------------------------------------------------------------
Retail - Regional Department Stores - 2.6%
110,000 Fred Meyer, Inc., 7.15%
senior notes, due 3/1/03 110,000
- --------------------------------------------------------------------------------
Super-Regional Banks - 3.5%
150,000 NationsBank Corp., 5.75%
senior notes, due 3/15/01 149,250
- --------------------------------------------------------------------------------
Total Corporate Bonds (cost $1,877,921) 1,883,752
- --------------------------------------------------------------------------------
U.S. Government Obligation - 40.6%
1,725,000 U.S. Treasury Note 6.375%
due 1/15/00 (cost $1,746,844) 1,746,407
- --------------------------------------------------------------------------------
U.S. Government Agency - 13.8%
Freddie Mac
595,000 5.85%, 7/1/98 (amortized cost $595,000) 595,000
- --------------------------------------------------------------------------------
Total Investments (total cost $4,219,765) - 98.2% 4,225,159
- --------------------------------------------------------------------------------
Cash, Receivables and Other Assets, net of Liabilities - 1.8% 77,549
- --------------------------------------------------------------------------------
Net Assets - 100% $ 4,302,708
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 41
<PAGE>
JANUS ASPEN MONEY MARKET PORTFOLIO Portfolio Manager, Sharon S. Pichler
Performance Review
For the six months ended June 30, 1998, Janus Aspen Money Market Portfolio
returned 2.63% for the Institutional Shares, and the Retirement Shares posted a
return of 2.39%. The seven-day current yield for the period ended June 30, 1998,
was 4.91% and 4.43% for the Institutional and Retirement Shares, respectively.
The yield quoted more accurately reflects the current earnings of the Portfolio
rather than the total return.
Focused on the Shortest of Short-Term Securities
During the period, the market appeared to be controlled more by
expectations than by facts. Investors' perceptions surrounding events in Asia,
as well as speculation regarding the direction of interest rates, led to wide
yet temporary swings in the market. At the same time, the crisis in the Far East
helped contribute to moderate economic growth in the U.S., while keeping
inflation in check. The latter caused the Federal Reserve Board to hold
overnight rates steady, pegging the federal funds rate at 5.5% throughout the
entire period. Alluding to this in a recent meeting with Congress, Federal
Reserve Chairman Alan Greenspan commented that renewed economic turmoil in Asia
could further dampen U.S. growth, possibly easing the need for an interest rate
hike in the months ahead.
The combination of these circumstances persuaded me to invest primarily in
very short-term obligations (as of June 30, the Portfolio's weighted average
maturity was 17 days), because they are less sensitive to market forces than
longer-term issues and react instead to changes in the federal funds rate. This
is clearly why the yield curve of short-term securities during the period was
relatively flat. As measured by the yield on the one-year Treasury bill,
short-term issues traded between 5.47% on the high end and 4.55% on the low end.
Our Discipline Proved Beneficial
With Asia's increasing financial problems, particularly the decline of the
yen and the subsequent devaluation of other Asian currencies, foreign investment
in U.S. Treasury securities increased. This flight to quality, however, focused
almost entirely on longer-dated Treasury securities (30-year), which are
considered among the world's safest, highest-rated investments. Our investment
universe, primarily Treasury bills and other instruments with maturities of one
year or less, was minimally affected.
Overall, our strict discipline of detailed credit analysis and careful
evaluation of each company's risk-reward characteristics again proved
beneficial. Thus, we were able to produce a competitive yield with low risk.
Going forward, until the global picture becomes clearer, the Portfolio will
remain invested primarily in securities with very short-term maturities. In the
meantime, I will continue to closely monitor various indicators, some of which
appear to show signs of a pending economic slowdown.
In closing, I'd like to thank you for your continued investment in Janus
Aspen Money Market Portfolio.
- --------------------------------------------------------------------------------
A money market portfolio is neither insured nor guaranteed by the U.S.
government, and there can be no assurance it will be able to maintain a $1.00
share price. The adviser voluntarily waives a portion of the Portfolio's
expenses. Without such waiver, the Portfolio's total returns for each class
would have been lower.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 42
<PAGE>
JANUS ASPEN MONEY MARKET PORTFOLIO June 30, 1998 (unaudited)
- --------------------------------------------------------------------------------
Principal Amount Market Value
- --------------------------------------------------------------------------------
Certificates of Deposit - 7.7%
Bayerische Landesbaken A.G.:
$ 1,000,000 5.775%, 7/27/98 $ 999,909
1,000,000 5.71%, 10/6/98 999,672
- --------------------------------------------------------------------------------
Total Certificates of Deposit (cost $1,999,581) 1,999,581
- --------------------------------------------------------------------------------
Short-Term Corporate Notes - 54.6%
1,000,000 America Express Credit Corp.
5.51%, 8/11/98 993,724
1,000,000 Associates Corp. of North America
5.50%, 8/7/98 994,347
1,000,000 Bankers Trust Co.
5.58%, 8/12/98 993,490
1,000,000 CIT Group Holdings, Inc.
5.50%, 8/7/98 994,347
1,250,000 Coca-Cola Corp.
5.52%, 7/28/98 1,244,825
1,444,000 Cogentrix of Richmond, Inc.
5.65%, 7/17/98 1,440,374
1,200,000 Ford Motor Credit Corp.
5.55%, 7/13/98 1,197,780
1,000,000 General Electric Capital Corp.
5.52%, 8/13/98 993,407
1,400,000 General Motors Acceptance Corp.
5.55%, 7/15/98 1,396,978
1,500,000 Goldman Sachs Group, L.P.
5.60%, 7/2/98 1,499,767
1,500,000 PHH Corp.
5.75%, 7/7/98 1,498,563
1,000,000 Sanwa Business Credit Corp.
6.15%, 7/23/98 996,242
- --------------------------------------------------------------------------------
Total Short-Term Corporate Notes (amortized cost $14,243,844) 14,243,844
- --------------------------------------------------------------------------------
Repurchase Agreements - 44.7%
$ 5,660,000 Goldman Sachs and Co., 6.10%
dated 6/30/98 maturing 7/1/98, to be
repurchased at $5,702,354 in Freddie Mac
6.50%, 9/1/03; with a value of $5,773,201*** $ 5,660,000
6,000,000 Morgan Stanley, Dean Witter, Discover & Co.,
6.25% dated 6/30/98 maturing 7/1/98, to
be repurchased at $6,001,042,
collateralized by $3,515,303 in Fannie
Mae 0.472% - 17.258%, 6/25/00 - 7/18/28;
by $3,369,053 in Freddie Mac 6.00% -
855.25%, 10/15/05 - 6/15/35; with
respective values of $4,502,980 and
$2,928,608*** 6,000,000
- --------------------------------------------------------------------------------
Total Repurchase Agreements (cost $11,660,000) 11,660,000
- --------------------------------------------------------------------------------
Total Investments (total cost $27,903,425) - 107.0% 27,903,425
- --------------------------------------------------------------------------------
Liabilities, net of Cash, Receivables and Other Assets - (7.0%) (1,826,875)
- --------------------------------------------------------------------------------
Net Assets - 100% $ 26,076,550
- --------------------------------------------------------------------------------
See Notes to Schedules of Investments.
NOTES TO SCHEDULES OF INVESTMENTS
(ADR) - American Depository Receipt
(GDR) - Global Depository Receipt
DEM - German Deutschemark
Adjustable Rate Preferred Stock Dividend Rates are as of 6/30/98.
* Non-income-producing security
** A portion of this security has been segregated by the custodian to cover
segregation requirements on open forward currency contracts.
*** Repurchase Agreements held by the Portfolio are fully collateralized and
such collateral is in the possession of the Portfolio's custodian. The
collateral is evaluated daily to ensure its market value equals or exceeds
the current market value of the repurchase agreements including accrued
interest. In the event of default on the obligation to repurchase, the
Portfolio has the right to liquidate the collateral and apply the proceeds
in satisfaction of the obligation. In the event of default or bankruptcy by
the other party to the agreement, realization and/or retention of the
collateral or proceeds may be subject to legal proceedings.
+ Securities are registered pursuant to Rule 144A and may be deemed to be
restricted for resale.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 43
<PAGE>
This space reserved for your notes and computations.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 44
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
As of June 30, 1998 (unaudited) Janus Aspen Janus Aspen Janus Aspen Janus Aspen
(all numbers in thousands except Janus Aspen Aggressive Capital International Worldwide Janus Aspen
Retirement Shares outstanding and Growth Growth Appreciation Growth Growth Balanced
net asset value per share) Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
Assets:
<S> <C> <C> <C> <C> <C> <C>
Investments at cost $ 655,819 $ 473,108 $ 18,518 $ 218,842 $1,925,968 $ 484,221
====================================================================================================================================
Investments at value $ 836,409 $ 636,295 $ 22,984 $ 265,961 $2,524,897 $ 563,315
Cash 159 119 38 24 1,072 87
Receivables:
Investments sold 873 592 705 3,256 33,058 99
Portfolio shares sold 1,248 249 353 342 3,455 1,139
Interest -- -- -- -- 5 3,451
Dividends 264 114 3 523 3,502 276
Other assets -- -- -- -- -- --
Foreign currency contracts -- -- -- 154 1,166 --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Assets 838,953 637,369 24,083 270,260 2,567,155 568,367
- ------------------------------------------------------------------------------------------------------------------------------------
Liabilities:
Payables:
Investments purchased 8,991 11,355 -- 14,050 164,877 6,788
Portfolio shares repurchased 779 783 -- 136 7,938 211
Advisery fee 417 344 12 133 1,230 315
Accrued expenses 40 32 7 53 142 19
Foreign currency contracts 18 406 -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Liabilities 10,245 12,920 19 14,372 174,187 7,333
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets $ 828,708 $ 624,449 $ 24,064 $ 255,888 $2,392,968 $ 561,034
====================================================================================================================================
Net Assets - Institutional Shares: $ 828,694 $ 624,434 $ 24,047 $ 255,875 $2,391,846 $ 561,020
Shares Outstanding, $.001 Par Value
(unlimited shares authorized) 40,040 25,905 1,454 11,528 83,328 28,191
Net Asset Value Per Share $ 20.70 $ 24.10 $ 16.54 $ 22.20 $ 28.70 $ 19.91
====================================================================================================================================
Net Assets - Retirement Shares: $ 14 $ 15 $ 17 $ 13 $ 1,122 $ 14
Shares Outstanding, $.001 Par Value
(unlimited shares authorized) 675 620 1,000 607 39,061 688
Net Asset Value Per Share $ 20.66 $ 23.97 $ 16.51 $ 22.19 $ 28.71 $ 19.90
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
STATEMENTS OF ASSETS AND LIABILITIES (Continued)
<TABLE>
<CAPTION>
As of June 30, 1998 (unaudited) Janus Aspen Janus Aspen Janus Aspen Janus Aspen
(all numbers in thousands except Equity Growth and Flexible Janus Aspen Short-Term Janus Aspen
Retirement Shares outstanding and Income Income Income High-Yield Bond Money Market
net asset value per share) Portfolio Portfolio(1) Portfolio Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
Assets:
<S> <C> <C> <C> <C> <C> <C>
Investments at cost $ 4,824 $ 1,683 $ 79,126 $ 3,858 $ 4,220 $ 27,903
====================================================================================================================================
Investments at value $ 5,761 $ 1,761 $ 80,770 $ 3,909 $ 4,225 $ 27,903
Cash 29 2 63 18 -- --
Receivables:
Investments sold 1 1 1,148 69 -- --
Portfolio shares sold 6 35 278 -- -- 111
Interest 5 1 1,443 79 88 99
Dividends 4 -- 4 -- -- --
Other assets -- 6 1 3 2 --
Foreign currency contracts -- -- 1 -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Assets 5,806 1,806 83,708 4,078 4,315 28,113
- ------------------------------------------------------------------------------------------------------------------------------------
Liabilities:
Payables:
Investments purchased 8 100 530 144 -- --
Portfolio shares repurchased -- -- 152 15 4 2,025
Advisery fee 3 1 43 2 2 6
Accrued expenses 6 3 9 14 6 5
Foreign currency contracts -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Liabilities 17 104 734 175 12 2,036
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets $ 5,789 $ 1,702 $ 82,974 $ 3,903 $ 4,303 $ 26,077
====================================================================================================================================
Net Assets - Institutional Shares: $ 5,772 $ 1,691 $ 82,962 $ 3,891 $ 4,292 $ 26,066
Shares Outstanding, $.001 Par Value
(unlimited shares authorized) 354 160 6,939 328 491 26,066
Net Asset Value Per Share $ 16.29 $ 10.56 $ 11.96 $ 11.87 $ 8.74 $ 1.00
====================================================================================================================================
Net Assets - Retirement Shares: $ 17 $ 11 $ 12 $ 12 $ 11 $ 11
Shares Outstanding, $.001 Par Value
(unlimited shares authorized) 1,013 1,000 966 1,004 1,225 10,552
Net Asset Value Per Share $ 16.21 $ 10.55 $ 11.96 $ 11.88 $ 8.75 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Janus Aspen Janus Aspen Janus Aspen Janus Aspen
For the six months ended Janus Aspen Aggressive Capital International Worldwide Janus Aspen
June 30, 1998 (unaudited) Growth Growth Appreciation Growth Growth Balanced
(all numbers in thousands) Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
Investment Income:
<S> <C> <C> <C> <C> <C> <C>
Interest $ 1,823 $ 303 $ 41 $ 425 $ 2,514 $ 5,018
Dividends 2,397 709 31 2,059 17,175 1,816
Foreign tax withheld (121) (26) -- (269) (2,153) (55)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Investment Income 4,099 986 72 2,215 17,536 6,779
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses:
Advisery fees 2,317 1,971 49 657 6,406 1,649
Transfer agent fees and expenses 2 1 -- 1 12 2
Registration fees 6 6 -- -- 23 2
System fees 7 10 4 6 9 8
Custodian fees 73 70 11 188 647 39
Insurance expense 5 5 -- 1 1 --
Audit fees 6 9 6 8 8 6
Other expenses 6 4 2 3 11 3
- ------------------------------------------------------------------------------------------------------------------------------------
Total Expenses 2,422 2,076 72 864 7,117 1,709
- ------------------------------------------------------------------------------------------------------------------------------------
Less: Expense Offset (3) (15) -- (1) (8) (10)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Expenses 2,419 2,061 72 863 7,109 1,699
- ------------------------------------------------------------------------------------------------------------------------------------
Less: Excess Expense Reimbursement -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Expenses After Reimbursement 2,419 2,061 72 863 7,109 1,699
- ------------------------------------------------------------------------------------------------------------------------------------
Net Investment Income/(Loss) 1,680 (1,075) -- 1,352 10,427 5,080
- ------------------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized
Gain/(Loss) on Investments:
Net realized gain/(loss)
from securities transactions 16,937 41,969 (371) 2,091 44,291 8,435
Net realized gain/(loss)
from foreign currency transactions (7) (461) -- 705 9,055 (13)
Net realized gain/(loss)
from futures contracts -- -- -- (120) (1,063) --
Change in net unrealized appreciation
or depreciation of investments 106,146 49,112 4,201 35,179 395,879 58,751
- ------------------------------------------------------------------------------------------------------------------------------------
Net Gain on Investments 123,076 90,620 3,830 37,855 448,162 67,173
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations $ 124,756 $ 89,545 $ 3,830 $ 39,207 $ 458,589 $ 72,253
====================================================================================================================================
</TABLE>
STATEMENTS OF OPERATIONS (Continued)
<TABLE>
<CAPTION>
Janus Aspen Janus Aspen Janus Aspen Janus Aspen
For the six months ended Equity Growth and Flexible Janus Aspen Short-Term Janus Aspen
June 30, 1998 (unaudited) Income Income Income High-Yield Bond Money Market
(all numbers in thousands) Portfolio Portfolio(1) Portfolio Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
Investment Income:
<S> <C> <C> <C> <C> <C> <C>
Interest $ 3 $ 2 $ 2,518 $ 161 $ 112 $ 729
Dividends 27 1 23 3 -- --
Foreign tax withheld -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Investment Income 30 3 2,541 164 112 729
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses:
Advisery fees 18 1 220 14 12 32
Transfer agent fees and expenses -- 1 -- -- -- --
Registration fees -- -- 1 1 -- --
System fees 2 2 6 5 4 5
Custodian fees 13 5 16 13 5 3
Insurance expense -- -- -- -- -- --
Audit fees 4 1 4 6 3 4
Other expenses 2 -- 2 1 1 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total Expenses 39 10 249 40 25 46
- ------------------------------------------------------------------------------------------------------------------------------------
Less: Expense Offset -- -- (2) -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Expenses 39 10 247 40 25 46
- ------------------------------------------------------------------------------------------------------------------------------------
Less: Excess Expense Reimbursement (9) (8) -- (21) (13) --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Expenses After Reimbursement 30 2 247 19 12 46
- ------------------------------------------------------------------------------------------------------------------------------------
Net Investment Income/(Loss) -- 1 2,294 145 100 683
- ------------------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized
Gain/(Loss) on Investments:
Net realized gain/(loss)
from securities transactions 57 4 1,324 98 8 --
Net realized gain/(loss)
from foreign currency transactions 1 -- 1 (1) -- --
Net realized gain/(loss)
from futures contracts -- -- -- -- -- --
Change in net unrealized appreciation
or depreciation of investments 858 78 (54) (14) (8) --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Gain on Investments 916 82 1,271 83 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets
Resulting from Operations $ 916 $ 83 $ 3,565 $ 228 $ 100 $ 683
====================================================================================================================================
</TABLE>
(1) For the period May 1, 1998, (inception) to June 30, 1998.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 45 and 46
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the six months ended
June 30, 1998, (unaudited)
and the fiscal year or period Janus Aspen Janus Aspen Janus Aspen Janus Aspen
ended December 31, 1997 Growth Aggressive Growth Capital Appreciation International Growth
(all numbers in thousands(3)) Portfolio Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997(1) 1998 1997
- ------------------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) $ 1,680 $ 4,350 $(1,075) $ (436) -- $ 25 $ 1,352 $ 669
Net realized gain/(loss) from
investment transactions 16,930 47,939 41,508 788 $ (371) (146) 2,676 (148)
Change in unrealized net appreciation
or (depreciation) of investments 106,146 39,125 49,112 56,805 4,201 265 35,179 10,109
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in
Net Assets Resulting from Operations 124,756 91,414 89,545 57,157 3,830 144 39,207 10,630
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions:
Net investment income (1,501) (4,361) -- -- (4) (21) (1,353) (645)
Dividends (in excess of net
investment income) -- -- -- -- -- -- -- --
Net realized gain from
investment transaction (48,597) (9,976) -- -- -- -- (3,097) (59)
Distributions (in excess of realized gains) -- -- -- -- -- -- -- (161)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Decrease in Net Assets
from Dividends and Distributions (50,098) (14,337) -- -- (4) (21) (4,450) (865)
- ------------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold:
Institutional Shares 140,022 244,131 111,239 204,318 22,785 9,452 131,279 185,562
Retirement Shares -- 10 -- 10 -- 10 -- 10
Reinvested dividends and distributions:
Institutional Shares 50,097 14,337 -- -- 4 21 4,450 864
Retirement Shares 1 -- -- -- -- -- -- --
Shares repurchased:
Institutional Shares (44,363) (53,051) (84,546) (136,967) (9,397) (2,760) (75,700) (62,291)
Retirement Shares -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets
from Capital Share Transactions 145,757 205,427 26,693 67,361 13,392 6,723 60,029 124,145
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 220,415 282,504 116,238 124,518 17,218 6,846 94,786 133,910
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of period 608,293 325,789 508,211 383,693 6,846 -- 161,102 27,192
- ------------------------------------------------------------------------------------------------------------------------------------
End of period $828,708 $608,293 $624,449 $508,211 $24,064 $ 6,846 $255,888 $161,102
====================================================================================================================================
Net Assets consist of:
Capital (par value and paid-in surplus)* $631,615 $485,858 $431,230 $404,537 $20,115 $ 6,723 $209,167 $149,136
Undistributed net investment
income/(distribution in excess)* 296 117 (1,075) -- -- 4 78 80
Undistributed net realized
gain/(loss) from investments* 16,227 47,894 31,514 (9,994) (517) (146) (626) (206)
Unrealized appreciation/(depreciation)
of investments 180,570 74,424 162,780 113,668 4,466 265 47,269 12,092
- ------------------------------------------------------------------------------------------------------------------------------------
$828,708 $608,293 $624,449 $508,211 $24,064 $ 6,846 $255,888 $161,102
====================================================================================================================================
Transactions in Portfolio Shares -
Institutional Shares:
Shares sold 6,832 14,157 5,006 11,104 1,546 765 6,370 10,297
Reinvested dividends and distributions 2,421 829 -- -- -- 2 201 46
- ------------------------------------------------------------------------------------------------------------------------------------
Total 9,253 14,986 5,006 11,104 1,546 767 6,571 10,343
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased (2,134) (3,068) (3,828) (7,417) (633) (226) (3,759) (3,357)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/Decrease in Portfolio Shares 7,119 11,918 1,178 3,687 913 541 2,812 6,986
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 32,921 21,003 24,727 21,040 541 -- 8,716 1,730
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 40,040 32,921 25,905 24,727 1,454 541 11,528 8,716
====================================================================================================================================
Transactions in Portfolio Shares -
Retirement Shares:(3)
Shares sold -- 618 -- 620 -- 1,000 -- 595
Reinvested dividends and distributions 40 17 -- -- -- -- 8 4
- ------------------------------------------------------------------------------------------------------------------------------------
Total 40 635 -- 620 -- 1,000 8 599
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/Decrease in Portfolio Shares 40 635 -- 620 -- 1,000 8 599
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 635 -- 620 -- 1,000 -- 599 --
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 675 635 620 620 1,000 1,000 607 599
====================================================================================================================================
Purchases and Sales of Investment Securities:
(excluding Short-Term Securities)
Purchases of Securities $331,142 $713,049 $357,614 $583,004 $14,741 $ 6,590 $139,362 $193,061
Proceeds from Sales of Securities 247,216 506,228 333,162 509,947 3,230 1,165 79,280 73,634
Purchases of Long-Term
U.S. Government Obligations -- -- -- -- -- -- -- --
Proceeds from Sales of Long-Term
U.S. Government Obligations -- -- -- -- -- -- -- --
====================================================================================================================================
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
<CAPTION>
For the six months ended
June 30, 1998, (unaudited) Janus Aspen
and the fiscal year or period Janus Aspen Janus Aspen Janus Aspen Growth and
ended December 31, 1997 Worldwide Growth Balanced Equity Income Income
(all numbers in thousands(3)) Portfolio Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997(1) 1998(2)
- ------------------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) $ 10,427 $ 7,744 $ 5,080 $ 5,061 -- $ 3 $ 1
Net realized gain/(loss)
from investment transactions 52,283 46,834 8,422 13,320 $ 58 71 4
Change in unrealized net appreciation
or (depreciation) of investments 395,879 135,768 58,751 15,763 858 80 78
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in
Net Assets Resulting from Operations 458,589 190,346 72,253 34,144 916 154 83
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions:
Net investment income (11,261) (9,330) (3,541) (5,104) -- (2) --
Dividends (in excess of
net investment income) -- (1,332) -- -- -- -- --
Net realized gain from investment transactions (69,710) (8,190) (13,227) (1,791) (74) -- --
Distributions (in excess of realized gains) -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Decrease in Net Assets
from Dividends and Distributions (80,971) (18,852) (16,768) (6,895) (74) (2) --
- ------------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold:
Institutional Shares 489,211 897,983 143,217 254,907 3,288 3,884 1,680
Retirement Shares 591 402 -- 10 -- 10 10
Reinvested dividends and distributions:
Institutional Shares 80,937 18,852 16,768 7,744 74 2 --
Retirement Shares 34 -- -- -- -- -- --
Shares repurchased:
Institutional Shares (132,360) (94,383) (16,857) (12,969) (1,475) (988) (71)
Retirement Shares (14) -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets
from Capital Share Transactions 438,399 822,854 143,128 249,692 1,887 2,908 1,619
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 816,017 994,348 198,613 276,941 2,729 3,060 1,702
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of period 1,576,951 582,603 362,421 85,480 3,060 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
End of period $ 2,392,968 $ 1,576,951 $ 561,034 $ 362,421 $ 5,789 $ 3,060 $ 1,702
====================================================================================================================================
Net Assets consist of:
Capital (par value and paid-in surplus)* $ 1,765,993 $ 1,327,595 $ 471,851 $ 328,723 $ 4,796 $ 2,908 $ 1,619
Undistributed net investment
income/(distribution in excess)* 723 1,556 1,667 129 -- 1 1
Undistributed net realized
gain/(loss) from investments* 26,214 43,642 8,423 13,228 56 71 4
Unrealized appreciation/(depreciation)
of investments 600,038 204,158 79,093 20,341 937 80 78
- ------------------------------------------------------------------------------------------------------------------------------------
$ 2,392,968 $ 1,576,951 $ 561,034 $ 362,421 $ 5,789 $ 3,060 $ 1,702
====================================================================================================================================
Transactions in Portfolio Shares -
Institutional Shares:
Shares sold 18,017 40,742 7,493 15,268 221 301 167
Reinvested dividends and distributions 2,829 819 847 470 5 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total 20,846 41,561 8,340 15,738 226 301 167
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased (4,924) (4,123) (900) (776) (98) (75) (7)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/Decrease in Portfolio Shares 15,922 37,438 7,440 14,962 128 226 160
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 67,406 29,968 20,751 5,789 226 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 83,328 67,406 28,191 20,751 354 226 160
====================================================================================================================================
Transactions in Portfolio Shares -
Retirement Shares:(3)
Shares sold 21,111 17,245 -- 650 -- 1,000 1,000
Reinvested dividends and distributions 1,188 6 19 19 13 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total 22,299 17,251 19 669 13 1,000 1,000
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased (489) -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/Decrease in Portfolio Shares 21,810 17,251 19 669 13 1,000 1,000
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 17,251 -- 669 -- 1,000 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 39,061 17,251 688 669 1,013 1,000 1,000
====================================================================================================================================
Purchases and Sales of Investment Securities:
(excluding Short-Term Securities)
Purchases of Securities $ 905,555 $ 1,715,083 $ 322,145 $ 377,245 $ 4,609 $ 3,560 $ 1,735
Proceeds from Sales of Securities 571,851 862,382 158,056 221,317 2,482 997 256
Purchases of Long-Term
U.S. Government Obligations -- -- 69,081 70,831 -- -- --
Proceeds from Sales of Long-Term
U.S. Government Obligations -- -- 87,964 13,669 -- -- --
====================================================================================================================================
STATEMENTS OF CHANGES IN NET ASSETS (Continued)
<CAPTION>
For the six months ended
June 30, 1998, (unaudited)
and the fiscal year or period Janus Aspen Janus Aspen Janus Aspen Janus Aspen
ended December 31, 1997 Flexible Income High-Yield Short-Term Bond Money Market
(all numbers in thousands(3)) Portfolio Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1998 1997 1998 1997 1998 1997
- ------------------------------------------------------------------------------------------------------------------------------------
Operations:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net investment income/(loss) $ 2,294 $ 2,522 $ 145 $ 125 $ 100 $ 724 $ 683 $ 461
Net realized gain/(loss)
from investment transactions 1,325 683 97 67 8 48 -- --
Change in unrealized net appreciation
or (depreciation) of investments (54) 1,050 (14) 39 (8) 18 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in
Net Assets Resulting from Operations 3,565 4,255 228 231 100 790 683 461
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and Distributions:
Net investment income (2,464) (2,372) (152) (117) (138) (722) (683) (461)
Dividends (in excess of net investment income) -- -- -- -- -- -- -- --
Net realized gain from investment transactions (704) (322) (66) (6) (46) (4) -- --
Distributions (in excess of realized gains) -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Decrease in Net Assets
from Dividends and Distributions (3,168) (2,694) (218) (123) (184) (726) (683) (461)
- ------------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions:
Shares sold:
Institutional Shares 31,670 35,431 2,814 3,976 2,667 23,232 83,537 78,614
Retirement Shares -- 10 -- 10 -- 10 -- 10
Reinvested dividends and distributions:
Institutional Shares 3,168 2,693 217 122 184 724 683 461
Retirement Shares -- 1 1 1 -- 2 -- --
Shares repurchased:
Institutional Shares (6,370) (10,902) (2,064) (2,075) (1,209) (33,188) (73,527) (69,807)
Retirement Shares -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets
from Capital Share Transactions 28,468 27,233 968 2,034 1,642 (9,220) 10,693 9,278
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/(Decrease) in Net Assets 28,865 28,794 978 2,142 1,558 (9,156) 10,693 9,278
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of period 54,109 25,315 2,925 783 2,745 11,901 15,384 6,106
- ------------------------------------------------------------------------------------------------------------------------------------
End of period $ 82,974 $ 54,109 $ 3,903 $ 2,925 $ 4,303 $ 2,745 $ 26,077 $ 15,384
====================================================================================================================================
Net Assets consist of:
Capital (par value and paid-in surplus)* $ 79,998 $ 51,530 $ 3,752 $ 2,783 $ 4,288 $ 2,646 $ 26,077 $ 15,384
Undistributed net investment
income/(distribution in excess)* 38 208 4 12 1 39 -- --
Undistributed net realized
gain/(loss) from investments* 1,293 672 97 66 9 47 -- --
Unrealized appreciation/(depreciation)
of investments 1,645 1,699 50 64 5 13 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
$ 82,974 $ 54,109 $ 3,903 $ 2,925 $ 4,303 $ 2,745 $ 26,077 $ 15,384
====================================================================================================================================
Transactions in Portfolio Shares -
Institutional Shares:
Shares sold 2,606 3,048 230 343 296 2,279 83,537 78,614
Reinvested dividends and distributions 265 234 18 11 21 78 683 461
- ------------------------------------------------------------------------------------------------------------------------------------
Total 2,871 3,282 248 354 317 2,357 84,220 79,075
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased (525) (941) (167) (179) (134) (3,242) (73,528) (69,807)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/Decrease in Portfolio Shares 2,346 2,341 81 175 183 (885) 10,692 9,268
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 4,593 2,252 247 72 308 1,193 15,374 6,106
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 6,939 4,593 328 247 491 308 26,066 15,374
====================================================================================================================================
Transactions in Portfolio Shares -
Retirement Shares:(3)
Shares sold -- 876 -- 893 -- 986 -- 10,000
Reinvested dividends and distributions 34 56 54 57 48 191 246 306
- ------------------------------------------------------------------------------------------------------------------------------------
Total 34 932 54 950 48 1,177 246 10,306
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Repurchased -- -- -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase/Decrease in Portfolio Shares 34 932 54 950 48 1,177 246 10,306
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding Beginning of Period 932 -- 950 -- 1,177 -- 10,306 --
- ------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding End of Period 966 932 1,004 950 1,225 1,177 10,552 10,306
====================================================================================================================================
Purchases and Sales of Investment Securities:
(excluding Short-Term Securities)
Purchases of Securities $ 74,842 $ 46,074 $ 6,866 $ 6,515 $ 1,886 $ 8,593 -- --
Proceeds from Sales of Securities 52,994 31,006 6,647 4,066 2,291 14,559 -- --
Purchases of Long-Term
U.S. Government Obligations 13,777 15,463 454 24 2,538 12,611 -- --
Proceeds from Sales of Long-Term
U.S. Government Obligations 12,578 7,755 449 25 790 16,534 -- --
====================================================================================================================================
</TABLE>
(1) Period May 1, 1997, (inception) to December 31, 1997.
(2) Period May 1, 1998, (inception) to June 30, 1998.
(3) Transactions in Portfolio Shares - Retirement Shares numbers are not in
thousands.
*See Note 3 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 47 and 48
<PAGE>
FINANCIAL HIGHLIGHTS - INSTITUTIONAL SHARES
<TABLE>
<CAPTION>
For a share outstanding during
the six months ended June 30, 1998,
(unaudited) or through each fiscal
year or period ended December 31 Janus Aspen Growth Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 18.48 $ 15.51 $ 13.45 $ 10.57 $ 10.32 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .04 .15 .17 .28 .09 .03
Net gains or (losses) on securities
(both realized and unrealized) 3.52 3.34 2.29 2.90 .20 .32
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 3.56 3.49 2.46 3.18 .29 .35
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.04) (.15) (.17) (.30) (.04) (.03)
Dividends (in excess of net investment income) -- -- -- -- -- --
Distributions (from capital gains) (1.30) (.37) (.23) -- -- --
Distributions (in excess of realized gains) -- -- -- -- -- --
Tax return of capital -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (1.34) (.52) (.40) (.30) (.04) (.03)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 20.70 $ 18.48 $ 15.51 $ 13.45 $ 10.57 $ 10.32
====================================================================================================================================
Total Return** 19.24% 22.75% 18.45% 30.17% 2.76% 3.50%
====================================================================================================================================
Net Assets, End of Period (in thousands) $828,694 $608,281 $325,789 $126,911 $ 43,549 $ 7,482
Average Net Assets for the Period (in thousands) $717,087 $477,914 $216,125 $ 77,344 $ 26,464 $ 3,191
Ratio of Gross Expenses to Average Net Assets*(2) 0.68% 0.70% 0.69% 0.78% N/A N/A
Ratio of Net Expenses to Average Net Assets*(2) 0.68% 0.69% 0.69% 0.76% 0.88% 0.25%
Ratio of Net Investment Income to Average Net Assets* 0.47% 0.91% 1.39% 1.24% 1.45% 2.54%
Portfolio Turnover Rate* 76% 122% 87% 185% 169% 162%
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during
the six months ended June 30, 1998,
(unaudited) or through each fiscal
year or period ended December 31 Janus Aspen Aggressive Growth Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 20.55 $ 18.24 $ 17.08 $ 13.62 $ 11.80 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) (.04) -- -- .24 .11 .01
Net gains or (losses) on securities
(both realized and unrealized) 3.59 2.31 1.36 3.47 1.82 1.80
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 3.55 2.31 1.36 3.71 1.93 1.81
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) -- -- -- (.25) (.11) (.01)
Dividends (in excess of net investment income) -- -- -- -- -- --
Distributions (from capital gains) -- -- (.19) -- -- --
Distributions (in excess of realized gains) -- -- -- -- -- --
Tax return of capital -- -- (.01) -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions -- -- (.20) (.25) (.11) (.01)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 24.10 $ 20.55 $ 18.24 $ 17.08 $ 13.62 $ 11.80
====================================================================================================================================
Total Return** 17.27% 12.66% 7.95% 27.48% 16.33% 18.05%
====================================================================================================================================
Net Assets, End of Period (in thousands) $624,434 $508,198 $383,693 $185,911 $ 41,289 $ 1,985
Average Net Assets for the Period (in thousands) $552,049 $418,464 $290,629 $107,582 $ 14,152 $ 1,091
Ratio of Gross Expenses to Average Net Assets*(2) 0.76% 0.76% 0.76% 0.86% N/A N/A
Ratio of Net Expenses to Average Net Assets*(2) 0.75% 0.76% 0.76% 0.84% 1.05% 0.25%
Ratio of Net Investment Income to Average Net Assets* (0.39%) (0.10%) (0.27%) 0.58% 2.18% 0.34%
Portfolio Turnover Rate* 124% 130% 88% 155% 259% 31%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
(1) Period September 13, 1993, (inception) to December 31, 1993.
(2) See footnote #5 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 49
<PAGE>
FINANCIAL HIGHLIGHTS - INSTITUTIONAL SHARES
<TABLE>
<CAPTION>
For a share outstanding during
the six months ended June 30, 1998,
(unaudited) or through each fiscal
year or period ended December 31 Janus Aspen International Growth Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 18.48 $ 15.72 $ 11.95 $ 9.72 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .12 .11 .05 .09 (.09)
Net gains or (losses) on securities
(both realized and unrealized) 3.99 2.80 4.06 2.16 (.19)
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 4.11 2.91 4.11 2.25 (.28)
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.12) (.11) (.11) (.02) --
Dividends (in excess of net investment income) -- -- -- -- --
Distributions (from capital gains) (.27) (.01) (.23) -- --
Distributions (in excess of realized gains) -- (.03) -- -- --
Tax return of capital -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.39) (.15) (.34) (.02) --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 22.20 $ 18.48 $ 15.72 $ 11.95 $ 9.72
====================================================================================================================================
Total Return** 22.22% 18.51% 34.71% 23.15% (2.80%)
====================================================================================================================================
Net Assets, End of Period (in thousands) $255,875 $161,091 $ 27,192 $ 1,608 $ 1,353
Average Net Assets for the Period (in thousands) $200,476 $ 96,164 $ 7,437 $ 1,792 $ 1,421
Ratio of Gross Expenses to Average Net Assets*(3) 0.87% 0.96% 1.26% 2.69% N/A
Ratio of Net Expenses to Average Net Assets*(3) 0.87% 0.96% 1.25% 2.50% 2.50%
Ratio of Net Investment Income to Average Net Assets* 1.36% 0.70% 0.62% (.80%) (1.30%)
Portfolio Turnover Rate* 86% 86% 65% 211% 275%
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during
the six months ended June 30, 1998,
(unaudited) or through each fiscal
year or period ended December 31 Janus Aspen Worldwide Growth Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 23.39 $ 19.44 $ 15.31 $ 12.07 $ 11.89 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .13 .16 .16 .11 .04 .02
Net gains or (losses) on securities
(both realized and unrealized) 6.19 4.14 4.27 3.19 .14 1.89
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 6.32 4.30 4.43 3.30 .18 1.91
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.14) (.17) (.17) (.06) -- (.01)
Dividends (in excess of net investment income) -- (.02) -- -- -- --
Distributions (from capital gains) (.87) (.16) (.13) -- -- (.01)
Distributions (in excess of realized gains) -- -- -- -- -- --
Tax return of capital -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (1.01) (.35) (.30) (.06) -- (.02)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 28.70 $ 23.39 $ 19.44 $ 15.31 $ 12.07 $ 11.89
====================================================================================================================================
Total Return** 27.02% 22.15% 29.04% 27.37% 1.53% 19.10%
====================================================================================================================================
Net Assets, End of Period (in thousands) $2,391,846 $1,576,548 $ 582,603 $ 108,563 $ 37,728 $ 4,856
Average Net Assets for the Period (in thousands) $1,979,002 $1,148,951 $ 304,111 $ 59,440 $ 22,896 $ 2,200
Ratio of Gross Expenses to Average Net Assets*(3) 0.73% 0.74% 0.80% 0.90% N/A N/A
Ratio of Net Expenses to Average Net Assets*(3) 0.73% 0.74% 0.80% 0.87% 1.18% 0.25%
Ratio of Net Investment Income to Average Net Assets* 1.06% 0.67% 0.83% 0.95% 0.50% 0.84%
Portfolio Turnover Rate* 68% 80% 62% 113% 217% 57%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
(1) Period May 2, 1994, (inception) to December 31, 1994.
(2) Period September 13, 1993, (inception) to December 31, 1993.
(3) See footnote #5 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 50
<PAGE>
FINANCIAL HIGHLIGHTS - INSTITUTIONAL SHARES
<TABLE>
<CAPTION>
For a share outstanding during the
six months ended June 30, 1998,
(unaudited) or through each fiscal
year or period ended December 31 Janus Aspen Balanced Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 17.47 $ 14.77 $ 13.03 $ 10.63 $ 10.64 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .18 .34 .32 .17 .15 .08
Net gains or (losses) on securities
(both realized and unrealized) 2.88 2.89 1.81 2.45 (.06) .64
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 3.06 3.23 2.13 2.62 .09 .72
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.13) (.35) (.30) (.22) (.10) (.08)
Dividends (in excess of net investment income) -- -- -- -- -- --
Distributions (from capital gains) (.49) (.18) (.09) -- -- --
Distributions (in excess of realized gains) -- -- -- -- -- --
Tax return of capital -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.62) (0.53) (.39) (.22) (.10) (.08)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 19.91 $ 17.47 $ 14.77 $ 13.03 $ 10.63 $ 10.64
====================================================================================================================================
Total Return** 17.45% 22.10% 16.18% 24.79% 0.84% 7.20%
====================================================================================================================================
Net Assets, End of Period (in thousands) $561,020 $362,409 $ 85,480 $ 14,021 $ 3,153 $ 537
Average Net Assets for the Period (in thousands) $452,881 $176,432 $ 43,414 $ 5,739 $ 2,336 $ 521
Ratio of Gross Expenses to Average Net Assets*(2) 0.76% 0.83% 0.94% 1.37% N/A N/A
Ratio of Net Expenses to Average Net Assets*(2) 0.76% 0.82% 0.92% 1.30% 1.57% 0.25%
Ratio of Net Investment Income to Average Net Assets* 2.26% 2.87% 2.92% 2.41% 1.90% 2.69%
Portfolio Turnover Rate* 113% 139% 103% 149% 158% 126%
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the
six months ended June 30, 1998,
(unaudited) or through each fiscal
year or period ended December 31 Janus Aspen Flexible Income Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993 (1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 11.78 $ 11.24 $ 11.11 $ 9.48 $ 9.97 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .33 .67 .74 .53 .47 .11
Net gains or (losses) on securities
(both realized and unrealized) .33 .62 .24 1.70 (.56) (.04)
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .66 1.29 .98 2.23 (.09) .07
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.37) (.64) (.72) (.60) (.40) (.10)
Dividends (in excess of net investment income) -- -- -- -- -- --
Distributions (from capital gains) (.11) (.11) (.13) -- -- --
Distributions (in excess of realized gains) -- -- -- -- -- --
Tax return of capital -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.48) (.75) (.85) (.60) (.40) (.10)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 11.96 $ 11.78 $ 11.24 $ 11.11 $ 9.48 $ 9.97
====================================================================================================================================
Total Return** 5.57% 11.76% 9.19% 23.86% (0.91%) 0.70%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 82,962 $ 54,098 $ 25,315 $ 10,831 $ 1,924 $ 538
Average Net Assets for the Period (in thousands) $ 68,129 $ 36,547 $ 17,889 $ 5,556 $ 1,636 $ 497
Ratio of Gross Expenses to Average Net Assets*(2) 0.73% 0.75% 0.84% 1.07% N/A N/A
Ratio of Net Expenses to Average Net Assets*(2) 0.74% 0.75% 0.83% 1.00% 1.00% 1.00%
Ratio of Net Investment Income to Average Net Assets* 6.79% 6.90% 7.31% 7.46% 5.49% 3.77%
Portfolio Turnover Rate* 216% 119% 250% 236% 234% 508%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
(1) Period September 13, 1993, (inception) to December 31, 1993.
(2) See footnote #5 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 51
<PAGE>
FINANCIAL HIGHLIGHTS - INSTITUTIONAL SHARES
<TABLE>
<CAPTION>
For a share outstanding during the
six months ended June 30, 1998,
(unaudited) or through each fiscal
year or period ended December 31 Janus Aspen Short-Term Bond Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 8.88 $ 9.97 $ 10.03 $ 9.72 $ 9.93 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .20 1.85 .42 .60 .35 .11
Net gains or (losses) on securities
(both realized and unrealized) .05 (1.19) (.03) .31 (.26) (.08)
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .25 .66 .39 .91 .09 .03
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.29) (1.75) (.44) (.60) (.30) (.10)
Dividends (in excess of net investment income) -- -- -- -- -- --
Distributions (from capital gains) (.10) -- (.01) -- -- --
Distributions (in excess of realized gains) -- -- -- -- -- --
Tax return of capital -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.39) (1.75) (.45) (.60) (.30) (.10)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 8.74 $ 8.88 $ 9.97 $ 10.03 $ 9.72 $ 9.93
====================================================================================================================================
Total Return** 2.78% 6.72% 3.98% 9.54% 0.92% 0.30%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 4,292 $ 2,735 $ 11,901 $ 3,187 $ 2,902 $ 502
Average Net Assets for the Period (in thousands) $ 3,731 $ 12,407 $ 7,168 $ 2,727 $ 1,774 $ 492
Ratio of Gross Expenses to Average Net Assets*(3) 0.65% 0.65% 0.66% 0.70% N/A N/A
Ratio of Net Expenses to Average Net Assets*(3) 0.65% 0.65% 0.65% 0.65% 0.65% 0.65%
Ratio of Net Investment Income to Average Net Assets* 5.41% 5.83% 5.44% 6.02% 5.00% 3.57%
Portfolio Turnover Rate* 191% 204% 416% 417% 256% 91%
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the
six months ended June 30, 1998,
(unaudited) or through each fiscal Janus Aspen Capital Janus Aspen Equity
year or period ended December 31 Appreciation Portfolio Income Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997(2) 1998 1997(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 12.62 $ 10.00 $ 13.46 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) -- .05 -- .01
Net gains or (losses) on securities
(both realized and unrealized) 3.92 2.61 3.04 3.46
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 3.92 2.66 3.04 3.47
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) -- (.04) -- (.01)
Dividends (in excess of net investment income) -- -- -- --
Distributions (from capital gains) -- -- (.21) --
Distributions (in excess of realized gains) -- -- -- --
Tax return of capital -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions -- (.04) (.21) (.01)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 16.54 $ 12.62 $ 16.29 $ 13.46
====================================================================================================================================
Total Return** 31.08% 26.60% 22.61% 34.70%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 24,047 $ 6,833 $ 5,772 $ 3,047
Average Net Assets for the Period (in thousands) $ 14,035 $ 2,632 $ 4,773 $ 1,101
Ratio of Gross Expenses to Average Net Assets*(3) 1.03% 1.26% 1.25% 1.25%
Ratio of Net Expenses to Average Net Assets*(3) 1.03% 1.25% 1.25% 1.25%
Ratio of Net Investment Income to Average Net Assets* -- 1.43% -- 0.35%
Portfolio Turnover Rate* 52% 101% 110% 128%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
(1) Period September 13, 1993, (inception) to December 31, 1993.
(2) Period May 1, 1997, (inception) to December 31, 1997.
(3) See footnote #5 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 52
<PAGE>
FINANCIAL HIGHLIGHTS - INSTITUTIONAL SHARES
<TABLE>
<CAPTION>
For a share outstanding during the Janus Aspen
six months ended June 30, 1998, Growth and Janus Aspen
(unaudited) or through each fiscal Income High-Yield
year or period ended December 31 Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998(1) 1998 1997 1996(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 10.00 $ 11.78 $ 10.83 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .01 .44 .70 .43
Net gains or (losses) on securities
(both realized and unrealized) .55 .35 .99 .80
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .56 .79 1.69 1.23
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) -- (.49) (.68) (.40)
Dividends (in excess of net investment income) -- -- -- --
Distributions (from capital gains) -- (.21) (.06) --
Distributions (in excess of realized gains) -- -- -- --
Tax return of capital -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions -- (.70) (.74) (.40)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 10.56 $ 11.87 $ 11.78 $ 10.83
====================================================================================================================================
Total Return** 5.60% 6.74% 15.98% 12.40%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 1,691 $ 3,891 $ 2,914 $ 783
Average Net Assets for the Period (in thousands) $ 1,033 $ 3,769 $ 1,565 $ 459
Ratio of Gross Expenses to Average Net Assets*(4) 1.25% 1.01% 1.00% 1.01%
Ratio of Net Expenses to Average Net Assets*(4) 1.25% 1.00% 1.00% 1.00%
Ratio of Net Investment Income to Average Net Assets* 0.75% 7.72% 7.98% 5.74%
Portfolio Turnover Rate* 120% 412% 299% 301%
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the
six months ended June 30, 1998,
(unaudited) or through each fiscal
year or period ended December 31 Janus Aspen Money Market Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995(3)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .03 .05 .05 .04
Net gains or (losses) on securities
(both realized and unrealized) -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .03 .05 .05 .04
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.03) (.05) (.05) (.04)
Dividends (in excess of net investment income) -- -- -- --
Distributions (from capital gains) -- -- -- --
Distributions (in excess of realized gains) -- -- -- --
Tax return of capital -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.03) (.05) (.05) (.04)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 1.00 $ 1.00 $ 1.00 $ 1.00
====================================================================================================================================
Total Return** 2.63% 5.17% 5.05% 3.63%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 26,066 $ 15,374 $ 6,106 $ 1,735
Average Net Assets for the Period (in thousands) $ 25,881 $ 8,926 $ 3,715 $ 1,543
Ratio of Gross Expenses to Average Net Assets*(4) 0.36% 0.50% 0.50% 0.50%
Ratio of Net Expenses to Average Net Assets*(4) 0.36% 0.50% 0.50% 0.50%
Ratio of Net Investment Income to Average Net Assets* 5.32% 5.17% 4.93% 5.30%
Portfolio Turnover Rate* N/A N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
(1) Period May 1, 1998, (inception) to June 30, 1998.
(2) Period May 1, 1996, (inception) to December 31, 1996.
(3) Period May 1, 1995, (inception) to December 31, 1995.
(4) See footnote #5 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 53
<PAGE>
FINANCIAL HIGHLIGHTS - RETIREMENT SHARES
<TABLE>
<CAPTION>
For a share outstanding during the Janus Aspen Janus Aspen
six months ended June 30, 1998, Janus Aspen Aggressive Capital
(unaudited) or through each fiscal Growth Growth Appreciation
year or period ended December 31 Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997(1) 1998 1997(1) 1998 1997(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 18.46 $ 16.18 $ 20.49 $ 16.12 $ 12.62 $ 10.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) -- .04 (.10) (.06) (.03) .12
Net gains or (losses) on securities
(both realized and unrealized) 3.50 2.71 3.58 4.43 3.92 2.50
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 3.50 2.75 3.48 4.37 3.89 2.62
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) -- (.10) -- -- -- --
Distributions (from capital gains) (1.30) (.37) -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (1.30) (.47) -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 20.66 $ 18.46 $ 23.97 $ 20.49 $ 16.51 $ 12.62
====================================================================================================================================
Total Return** 18.93% 17.22% 16.98% 27.11% 30.82% 26.20%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 14 $ 12 $ 15 $ 13 $ 17 $ 13
Average Net Assets for the Period (in thousands) $ 13 $ 11 $ 14 $ 11 $ 14 $ 12
Ratio of Gross Expenses to Average Net Assets*(2) 1.17% 1.20% 1.26% 1.32% 1.54% 1.73%
Ratio of Net Expenses to Average Net Assets*(2) 1.16% 1.20% 1.26% 1.32% 1.53% 1.73%
Ratio of Net Investment Income to Average Net Assets* (0.03%) 0.29% (0.90%) (0.62%) (0.44%) 1.55%
Portfolio Turnover Rate* 76% 122% 124% 130% 52% 101%
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the Janus Aspen Janus Aspen
six months ended June 30, 1998, International Worldwide Janus Aspen
(unaudited) or through each fiscal Growth Growth Balanced
year or period ended December 31 Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997(1) 1998 1997(1) 1998 1997(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 18.44 $ 16.80 $ 23.36 $ 20.72 $ 17.47 $ 15.38
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .08 .04 .06 .14 .16 .27
Net gains or (losses) on securities
(both realized and unrealized) 3.95 1.73 6.18 2.80 2.84 2.30
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 4.03 1.77 6.24 2.94 3.00 2.57
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.01) (.09) (.02) (.14) (.08) (.30)
Distributions (from capital gains) (.27) (.04) (.87) (.16) (.49) (.18)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.28) (.13) (.89) (.30) (.57) (.48)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 22.19 $ 18.44 $ 28.71 $ 23.36 $ 19.90 $ 17.47
====================================================================================================================================
Total Return** 21.89% 10.53% 26.71% 14.22% 17.16% 16.92%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 13 $ 11 $ 1,122 $ 403 $ 14 $ 12
Average Net Assets for the Period (in thousands) $ 12 $ 11 $ 640 $ 11 $ 13 $ 11
Ratio of Gross Expenses to Average Net Assets*(2) 1.36% 1.45% 1.25% 1.26% 1.25% 1.32%
Ratio of Net Expenses to Average Net Assets*(2) 1.36% 1.45% 1.25% 1.26% 1.25% 1.32%
Ratio of Net Investment Income to Average Net Assets* 0.78% 0.26% 0.74% 0.16% 1.74% 2.38%
Portfolio Turnover Rate* 86% 86% 68% 80% 113% 139%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
(1) Period May 1, 1997, (inception) to December 31, 1997.
(2) See footnote #5 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 54
<PAGE>
FINANCIAL HIGHLIGHTS - RETIREMENT SHARES
<TABLE>
<CAPTION>
For a share outstanding during the Janus Aspen
six months ended June 30, 1998, Janus Aspen Growth and Janus Aspen
(unaudited) or through each fiscal Equity Income Income Flexible Income
year or period ended December 31 Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997(1) 1998(2) 1998 1997(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 13.42 $ 10.00 $ 10.00 $ 11.77 $ 11.41
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) (.03) .01 .01 .38 .50
Net gains or (losses) on securities
(both realized and unrealized) 3.03 3.41 .54 .25 .58
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 3.00 3.42 .55 .63 1.08
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) -- -- -- (.33) (.61)
Distributions (from capital gains) (.21) -- -- (.11) (.11)
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.21) -- -- (.44) (.72)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 16.21 $ 13.42 $ 10.55 $ 11.96 $ 11.77
====================================================================================================================================
Total Return** 22.37% 34.20% 5.50% 5.32% 9.73%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 17 $ 13 $ 11 $ 12 $ 11
Average Net Assets for the Period (in thousands) $ 15 $ 12 $ 10 $ 11 $ 10
Ratio of Gross Expenses to Average Net Assets*(3) 1.74% 1.74% 1.67% 1.25% 1.23%
Ratio of Net Expenses to Average Net Assets*(3) 1.74% 1.74% 1.67% 1.24% 1.23%
Ratio of Net Investment Income to Average Net Assets* (0.47)% 0.07% 0.50% 6.26% 6.39%
Portfolio Turnover Rate* 110% 128% 120% 216% 119%
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For a share outstanding during the Janus Aspen Janus Aspen
six months ended June 30, 1998, Janus Aspen Short-Term Money
(unaudited) or through each fiscal High-Yield Bond Market
year or period ended December 31 Portfolio Portfolio Portfolio
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1997(1) 1998 1997(1) 1998 1997(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 11.78 $ 11.19 $ 8.88 $ 10.14 $ 1.00 $ 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
Income from Investment Operations:
Net investment income/(loss) .42 .59 .21 .56 .02 .03
Net gains or (losses) on securities
(both realized and unrealized) .34 .71 .02 (.11) -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .76 1.30 .23 .45 .02 .03
- ------------------------------------------------------------------------------------------------------------------------------------
Less Distributions:
Dividends (from net investment income) (.45) (.65) (.26) (1.71) (.02) (.03)
Distributions (from capital gains) (.21) (.06) (.10) -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.66) (.71) (.36) (1.71) (.02) (.03)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 11.88 $ 11.78 $ 8.75 $ 8.88 $ 1.00 $ 1.00
====================================================================================================================================
Total Return** 6.40% 11.96% 2.56% 4.53% 2.39% 3.13%
====================================================================================================================================
Net Assets, End of Period (in thousands) $ 12 $ 11 $ 11 $ 10 $ 11 $ 10
Average Net Assets for the Period (in thousands) $ 12 $ 11 $ 11 $ 10 $ 10 $ 10
Ratio of Gross Expenses to Average Net Assets*(3) 1.50% 1.50% 1.13% 1.20% 0.85% 1.00%
Ratio of Net Expenses to Average Net Assets*(3) 1.49% 1.50% 1.13% 1.19% 0.85% 1.00%
Ratio of Net Investment Income to Average Net Assets* 7.29% 7.42% 4.90% 5.43% 4.74% 4.66%
Portfolio Turnover Rate* 412% 299% 191% 204% N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Annualized for periods of less than one full year.
**Total return not annualized for periods of less than one full year.
(1) Period May 1, 1997, (inception) to December 31, 1997.
(2) Period May 1, 1998, (inception) to June 30, 1998.
(3) See footnote #5 in Notes to Financial Statements.
See Notes to Financial Statements.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 55
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. Organization and Significant Accounting Policies
Janus Aspen Series (the "Trust") was organized as a Delaware Trust on May
20, 1993, and is registered under the Investment Company Act of 1940 (the "1940
Act") as a no-load, open-end management investment company. The Trust offers 12
Portfolios or series of shares with differing investment objectives and
policies. Eight Portfolios invest primarily in equity securities: Janus Aspen
Growth Portfolio, Janus Aspen Aggressive Growth Portfolio, Janus Aspen Capital
Appreciation Portfolio, Janus Aspen International Growth Portfolio, Janus Aspen
Worldwide Growth Portfolio, Janus Aspen Balanced Portfolio, Janus Aspen Equity
Income Portfolio, and Janus Aspen Growth and Income Portfolio. Three Portfolios
invest primarily in income-producing securities: Janus Aspen Flexible Income
Portfolio, Janus Aspen High-Yield Portfolio and Janus Aspen Short-Term Bond
Portfolio. Janus Aspen Money Market Portfolio invests in short-term money market
securities. Each Portfolio is diversified as defined in the 1940 Act, with the
exception of the Aggressive Growth Portfolio and Capital Appreciation Portfolio,
which are nondiversified.
Institutional Shares of the Trust are issued and redeemed only in
connection with investment in and payments under variable annuity contracts and
variable life insurance contracts (collectively "variable insurance contracts"),
as well as certain qualified retirement plans. Effective May 1, 1997, the Trust
issued a new class of shares, the Retirement Shares. Retirement Shares of the
Trust are issued and redeemed only in connection with certain qualified
retirement plans. Janus Capital invested $10,000 of initial seed capital in each
Portfolio of the Retirement Shares.
Organizational costs for the Trust were borne by Janus Capital Corporation
(the Trust's investment adviser). Effective May 1, 1998, the Trust issued one
new series of shares, the Janus Aspen Growth and Income Portfolio. Janus Capital
invested $10,000 of initial seed capital in the Portfolio.
The following accounting policies have been consistently followed by the
Trust and are in conformity with accounting principles generally accepted in the
investment company industry.
Investment Valuation
Securities are valued at the closing price for securities traded on a
principal securities exchange (U.S. or foreign) and on the NASDAQ National
Market. Securities traded on over-the-counter markets and listed securities for
which no sales are reported are valued at the latest bid price (or yield
equivalent thereof) obtained from one or more dealers making a market for such
securities or by a pricing service approved by the Trustees. Short-term
investments maturing within 60 days and all money market securities in the Money
Market Portfolio are valued at amortized cost, which approximates market value.
Foreign securities are converted to U.S. dollars using exchange rates at the
close of the New York Stock Exchange. When market quotations are not readily
available, securities are valued at fair value as determined in good faith under
procedures established by the Trustees.
Investment Transactions and Investment Income
Investment transactions are accounted for as of the date purchased or sold.
Dividend income is recorded on the ex-dividend date. Certain dividends from
foreign securities will be recorded as soon as the Trust is informed of the
dividend if such information is obtained subsequent to the ex-dividend date.
Interest income is recorded on the accrual basis and includes amortization of
discounts and premiums. Gains and losses are determined on the identified cost
basis, which is the same basis used for federal income tax purposes.
Forward Currency Transactions and Futures Contracts
The Portfolios enter into forward currency contracts in order to hedge
their exposure to changes in foreign currency exchange rates on their foreign
portfolio holdings and to lock in the U.S. dollar cost of firm purchase and
sales commitments denominated in foreign currencies. A forward currency contract
is a commitment to purchase or sell a foreign currency at a future date at a
negotiated forward rate. The gain or loss arising from the difference between
the U.S. dollar cost of the original contract and the value of the foreign
currency in U.S. dollars upon closing such contract is included in net realized
gain or loss on foreign currency transactions. Forward currency contracts held
by the Portfolios are fully covered by other securities, in possession at the
portfolio's custodian, which are denoted in the accompanying Schedule of
Investments. The market value of these securities is evaluated daily to ensure
that it is equal to or exceeds the current market value of the corresponding
forward currency contract.
Currency gain and loss are also calculated on payables and receivables that
are denominated in foreign currencies. The payables and receivables are
generally related to security transactions and income.
Futures contracts are marked to market daily, and the variation margin is
recorded as an unrealized gain or loss. When a contract is closed, a realized
gain or loss is recorded equal to the difference between the opening and closing
value of the contract. Generally, open forward and futures contracts are marked
to market (i.e., treated as realized and subject to distribution) for federal
income tax purposes at fiscal year-end.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 56
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Foreign-denominated assets and forward currency contracts may involve more
risks than domestic transactions, including: currency risk, political and
economic risk, regulatory risk, and market risk. Risks may arise from the
potential inability of a counterparty to meet the terms of a contract and from
unanticipated movements in the value of foreign currencies relative to the U.S.
dollar.
The Portfolios may enter into futures contracts and options on securities,
financial indexes and foreign currencies, forward contracts, and interest-rate
swaps and swap-related products. The Portfolios intend to use such derivative
instruments primarily to hedge or protect from adverse movements in securities
prices, currency rates or interest rates. The use of futures contracts and
options may involve risks such as the possibility of illiquid markets or
imperfect correlation between the value of the contracts and the underlying
securities that the counterparty will fail to perform its obligations.
Additional Investment Risk
A portion of the Flexible Income and High-Yield Portfolios may be invested
in lower-rated debt securities that have a higher risk of default or loss of
value because of changes in the economy or in their respective industry.
Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amount of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
Dividend Distributions and Expenses
Each Portfolio, except the Money Market Portfolio, makes semiannual
distributions of substantially all of its investment income and an annual
distribution of its net realized capital gains, if any. The Money Market
Portfolio makes daily distributions of its income. All dividends and capital
gains distributions from a Portfolio will be automatically reinvested into
additional shares of that Portfolio.
Each Portfolio bears expenses incurred specifically on its behalf as well
as a portion of general expenses based generally on the relative net assets of
each Portfolio.
Federal Income Taxes
No provision for income taxes is included in the accompanying financial
statements as the Portfolios intend to distribute to shareholders all taxable
investment income and realized gains and otherwise comply with the Internal
Revenue Code applicable to regulated investment companies.
2. Investment Advisery Agreement and Other Transactions With Affiliates
Investment advisery fees for each of the eight equity Portfolios are
payable to Janus Capital based upon annual rates of .75% of the first $300
million of average net assets, .70% of the next $200 million of average net
assets, and .65% of the average net assets in excess of $500 million. However,
Janus Capital has voluntarily agreed to reduce each equity Portfolio's advisery
fee to the extent that such fee exceeds the effective rate of the Janus retail
fund corresponding to such Portfolio. The effective rate is the advisery fee
calculated by the corresponding retail fund as of the last day of each calendar
quarter (expressed as an annual rate). Janus Aspen Growth Portfolio, Janus Aspen
Aggressive Growth Portfolio, Janus Aspen Capital Appreciation Portfolio, Janus
Aspen International Growth Portfolio, Janus Aspen Worldwide Growth Portfolio,
Janus Aspen Balanced Portfolio, Janus Aspen Equity Income Portfolio, and Janus
Aspen Growth and Income Portfolio advisery fees are reduced to the effective
rates of Janus Fund, Janus Enterprise Fund, Janus Olympus Fund, Janus Overseas
Fund, Janus Worldwide Fund, Janus Balanced Fund, Janus Equity Income Fund, Janus
Growth and Income Fund respectively. The effective rate for each Portfolio for
the period ended June 30, 1998, was .65%, .72%, .70%, .66%, .65%, .72%, .75%,
and .66% respectively. The Flexible Income and Short-Term Bond Portfolios are
each subject to advisery fees payable to Janus Capital based upon annual rates
of .65% of the first $300 million of average net assets plus .55% of average net
assets in excess of $300 million. The High-Yield Portfolio's advisery fee rate
is payable at rates of .75% of the first $300 million of average net assets plus
.65% of average net assets in excess of $300 million. The Money Market
Portfolio's advisery fee rate is .25% of average net assets. For additional
information on the specific fees for the Retirement Shares, please refer to note
4 of the financial statements.
Janus Capital has agreed to reduce its fee to the extent normal operating
expenses exceed 1% of the average net assets of the Flexible Income and
High-Yield Portfolios; .65% of the average net assets of the Short-Term Bond
Portfolio; and .50% of the average net assets of the Money Market Portfolio for
a fiscal year.
Janus Capital may terminate any of these fee waivers or reductions on at
least 90 days notice to the Trustees. The participant administration fee and
distribution fee applicable to the Retirement Shares are not included in these
expense limits.
Until at least May 1, 1999, Janus Capital has also agreed to reduce its fee
to the extent that normal operating expenses exceed 1.25% of the average net
assets of the Capital Appreciation, Equity Income, and Growth and Income
Portfolios.
Officers and certain trustees of the Trust are also officers and/or
directors of Janus Capital; however, they receive no compensation from the
Trust.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 57
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DST Systems, Inc. (DST), an affiliate of Janus Capital through a degree of
common ownership, provides accounting systems to the Portfolios. DST Securities,
Inc., a wholly owned subsidiary of DST, provides brokerage services on certain
portfolio transactions. Brokerage commissions paid to DST Securities, Inc. serve
to reduce fees and expenses. Brokerage commissions paid, fees reduced, and the
net fees paid to DST for the period ended June 30, 1998, are noted below:
<TABLE>
<CAPTION>
DST Securities, Inc. Portfolio Expense DST Systems
Portfolio Commissions Paid* Reduction* Costs
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Janus Aspen Growth Portfolio -- -- $ 8,107
- ---------------------------------------------------------------------------------------------
Janus Aspen Aggressive Growth Portfolio $9,626 $7,219 638
- ---------------------------------------------------------------------------------------------
Janus Aspen Capital Appreciation Portfolio -- -- 3,536
- ---------------------------------------------------------------------------------------------
Janus Aspen International Growth Portfolio -- -- 5,535
- ---------------------------------------------------------------------------------------------
Janus Aspen Worldwide Growth Portfolio -- -- 10,015
- ---------------------------------------------------------------------------------------------
Janus Aspen Balanced Portfolio -- -- 6,986
- ---------------------------------------------------------------------------------------------
Janus Aspen Equity Income Portfolio 7 5 2,069
- ---------------------------------------------------------------------------------------------
Janus Aspen Growth and Income Portfolio -- -- --
- ---------------------------------------------------------------------------------------------
Janus Aspen Flexible Income Portfolio -- -- 4,771
- ---------------------------------------------------------------------------------------------
Janus Aspen High-Yield Portfolio -- -- 3,119
- ---------------------------------------------------------------------------------------------
Janus Aspen Short-Term Bond Portfolio -- -- 3,150
- ---------------------------------------------------------------------------------------------
Janus Aspen Money Market Portfolio -- -- 4,654
- ---------------------------------------------------------------------------------------------
</TABLE>
*The difference between commissions paid to DST Securities, Inc. and expenses
reduced constituted commissions paid to an unaffiliated clearing broker.
3. Federal Income Tax
The Portfolios have elected to treat gains and losses on forward foreign
currency contracts as capital gains and losses. Other foreign currency gains and
losses on debt instruments are treated as ordinary income for federal income tax
purposes pursuant to Section 988 of the Internal Revenue Code. As of December
31, 1997, the net capital loss carryovers noted below are available to offset
future realized capital gains and thereby reduce future taxable gains
distributions. These carryovers expire between December 31, 2004, and December
31, 2005. In 1997, the Portfolios noted below incurred "post-October" losses
during the period from November 1 through December 31, 1997. These losses will
be deferred for tax purposes and recognized in 1998.
The aggregate cost of investments and the composition of unrealized
appreciation and depreciation of investments for federal income tax purposes as
of June 30, 1998, are also noted below.
<TABLE>
<CAPTION>
at June 30, 1998
--------------------------------------------------------------------------------------------
Net Capital Loss Post-October Federal Tax Unrealized Unrealized Net Appreciation/
Portfolio Carryovers Losses Cost Appreciation (Depreciation) (Depreciation)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Janus Aspen Growth Portfolio -- ($ 336,826) $ 655,842,669 $190,997,125 ($10,430,925) $180,566,200
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen Aggressive Growth Portfolio ($9,224,354) -- 475,310,502 168,154,487 (7,169,649) 160,984,838
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen Capital Appreciation Portfolio (25,613) (120,295) 18,518,670 4,688,732 (223,162) 4,465,570
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen International Growth Portfolio -- (2,607,314) 218,915,459 52,594,308 (5,548,749) 47,045,559
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen Worldwide Growth Portfolio -- (17,297,533) 1,926,436,817 628,020,226 (29,559,965) 598,460,261
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen Balanced Portfolio -- -- 484,221,405 82,987,391 (3,894,296) 79,093,095
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen Equity Income Portfolio -- (2,372) 4,823,780 1,027,101 (89,730) 937,371
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen Growth and Income Portfolio -- -- 1,683,968 104,637 (27,512) 77,125
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen Flexible Income Portfolio -- -- 79,126,410 1,804,856 (160,832) 1,644,024
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen High-Yield Portfolio -- -- 3,859,500 79,699 (30,615) 49,084
- ------------------------------------------------------------------------------------------------------------------------------------
Janus Aspen Short-Term Bond Portfolio -- -- 4,219,766 8,503 (3,110) 5,393
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Janus Aspen Money Market Portfolio -- -- 27,903,425 -- -- --
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</TABLE>
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 58
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
4. Expenses
The Portfolios' expenses may be reduced through expense reduction
arrangements. Those arrangements include the use of broker commissions paid to
DST Securities, Inc. and uninvested cash balances earning interest with the
Portfolios' custodian. The Statements of Operations reflect the total expenses
before any offset, the amount of the offset, and the net expenses. The expense
ratios listed in the Financial Highlights reflect expenses prior to any expense
offset (gross expense ratio) and after expense offsets (net expense ratio).
Janus Aspen Series Retirement Shares incur a pro rata share of operating
expenses. In addition, the Retirement Shares pay a distribution fee of up to
.25% of average net assets and a participant administration fee of up to .25% of
average net assets.
5. Expense Ratios
Listed below are the gross expense ratios for the various Portfolios that
would be in effect, absent the waiver of certain fees and/or voluntary reduction
of the adviser's fee to the effective rate of the corresponding Janus retail
fund. Expense ratios are annualized for all periods less than one year.
For the six months or period ended June 30, 1998 (unaudited) or through
each fiscal year or period ended December 31
<TABLE>
<CAPTION>
Institutional Shares Retirement Shares
Portfolio 1998 1997 1996 1995 1994 1993(6) 1998 1997(2)
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
Janus Aspen Growth Portfolio 0.74% 0.78% 0.83% 0.98% 1.23% 2.16% 1.26% 1.28%
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Janus Aspen Aggressive Growth Portfolio 0.76% 0.78% 0.83% 0.93% 1.14% 5.79% 1.29% 1.34%
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Janus Aspen Capital Appreciation Portfolio 1.08% 2.19%(2) N/A N/A N/A N/A 1.58% 2.66%
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Janus Aspen International Growth Portfolio 0.96% 1.08% 2.21% 3.57% 4.67%(5) N/A 1.45% 1.57%
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Janus Aspen Worldwide Growth Portfolio 0.74% 0.81% 0.91% 1.09% 1.49% 2.71% 1.35% 1.32%
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Janus Aspen Balanced Portfolio 0.76% 0.83% 1.07% 1.55% 1.74% 7.92% 1.27% 1.33%
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Janus Aspen Equity Income Portfolio 1.62% 5.75%(2) N/A N/A N/A N/A 2.10% 6.19%
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Janus Aspen Growth and Income Portfolio(1) 5.70% N/A N/A N/A N/A N/A 6.12% N/A
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Janus Aspen Flexible Income Portfolio 0.74% 0.75% 0.84% 1.07% 1.35% 5.27% 1.25% 1.23%
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Janus Aspen High-Yield Portfolio 2.13% 3.27% 6.29%(3) N/A N/A N/A 2.62% 3.42%
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Janus Aspen Short-Term Bond Portfolio 1.38% 0.91% 0.84% 1.37% 1.40% 5.33% 1.86% 1.49%
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Janus Aspen Money Market Portfolio 0.36% 0.55% 0.78% 1.07%(4) N/A N/A 0.85% 1.10%
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</TABLE>
(1) Period May 1, 1998, (inception) to June 30, 1998.
(2) Period May 1, 1997, (inception) to December 31, 1997.
(3) Period May 1, 1996, (inception) to December 31, 1996.
(4) Period May 1, 1995, (inception) to December 31, 1995.
(5) Period May 2, 1994, (inception) to December 31, 1994.
(6) Period September 13, 1993, (inception) to December 31, 1993.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 59
<PAGE>
This space reserved for your notes and computations.
JANUS ASPEN SERIES JUNE 30, 1998 SEMIANNUAL REPORT 60
<PAGE>
[LOGO] JANUS
P.O. Box 173375
Denver, CO 80217-3375
1-800-504-4440
Retirement Shares distributed by Janus Distributors, Inc. Member NASD
