<PAGE> 1
LINDNER FUNDS
ADVISED BY RYBACK MANAGEMENT CORPORATION
----------------------------------------
[LOGO] 7711 Carondelet Avenue, Ste. 700 CONTENTS
St. Louis, Missouri 63105
Tel: 314-727-5305
Fax: 314-727-9306
Statements of Assets & Liabilities p.2
LINDNER GROWTH FUND
Letter from the Fund Managers p.4
Schedules of Investments p.6
LINDNER DIVIDEND FUND
Letter from the Fund Manager p.10
Schedules of Investments p.11
LINDNER UTILITY FUND
Letter from the Fund Managers p.15
Schedules of Investments p.16
LINDNER/RYBACK SMALL-CAP FUND
Letter from the Fund Managers p.18
Schedules of Investments p.19
LINDNER BULWARK FUND
Letter from the Fund Manager p.21
Schedules of Investments p.22
LINDNER INTERNATIONAL FUND
Letter from the Fund Managers p.24
Schedules of Investments p.25
Statements of Operations p.27
Statements of Changes in Net Assets p.29
Notes to Financial Statements p.31
Financial Highlights p.39
- --------------------------------------------------------------------------------
To Our Shareholders
The last half of 1997 was fraught with some of the greatest volatility in
recent memory. During the third quarter we witnessed the resurgence of
small-company stocks, a movement that had been a long time in coming. The
last quarter reversed many investors' gains with proof that U.S. markets are not
immune to the ills of overseas markets. Hopefully this is a lesson that many
will take with them into 1998.
The past year was one of humility for the Lindner Funds management. While
some of the funds surpassed their benchmarks, others lagged considerably.
Inside this report you will find frank and open discussions about the
performance of each Lindner Fund. If you would like to inquire further about
any of our portfolios, simply call your customer service representative at
800-995-7777 or access our Internet site, www.lindnerfunds.com. All of our
portfolio managers join me in thanking you for investing with us and for your
continued interest in the Lindner Funds.
Sincerely,
/s/ Eric E. Ryback
Eric E. Ryback
President
<PAGE> 2
<TABLE>
- -------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1997
(Unaudited)
<CAPTION>
LINDNER GROWTH FUND LINDNER DIVIDEND FUND
------------------- ---------------------
<S> <C> <C>
ASSETS
Investment securities, at value:
Unaffiliated issuers (identified cost of $804,381,116,
$1,535,419,885, $39,458,413, $36,946,580, $37,632,322 and
$3,296,974, respectively) $1,043,666,115 $1,659,309,925
Affiliated issuers (identified cost $248,074,155, $78,554,834
and $2,692,016, respectively) (Note 5) 319,884,696 115,234,310
Cash 450,902 1,420,776
Receivables:
Investments sold - long 13,973,203 7,749,649
Dividends and interest 1,730,641 23,288,546
Fund shares sold 116,485 141,239
Investments sold - short -- --
Deposits with brokers for securities sold short -- --
Unamortized organizational expense (Note 4) -- --
Receivable for expenses reimbursed by advisor -- --
Other assets 5,527 5,589
------------------ ------------------
Total assets 1,379,827,569 1,807,150,034
------------------ ------------------
LIABILITIES
Accounts payable and accrued liabilities:
Investment securities purchased 4,346,991 722,653
Investments sold short, at value (proceeds $8,091,035) -- --
Short sales covered -- --
Fund shares redeemed 1,583,150 1,673,433
Other liabilities:
Management fee (Note 3) 1,696,422 2,348,388
Organizational expense (Note 4) -- --
Other 270,786 275,171
------------------ ------------------
Total liabilities 7,897,349 5,019,645
------------------ ------------------
NET ASSETS $1,371,930,220 $1,802,130,389
================== ==================
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in capital) $1,047,082,548 $1,681,249,865
Undistributed net investment income (loss) 1,316,094 3,131,718
Accumulated net realized gain (loss) on investments and foreign
currency transactions 12,440,399 (42,818,063)
Net unrealized appreciation (depreciation) on investments and
translation of assets and liabilities in foreign currency 311,091,179 160,566,869
------------------ ------------------
NET ASSETS APPLICABLE TO OUTSTANDING SHARES $1,371,930,220 $1,802,130,389
================== ==================
NET ASSET VALUE PER SHARE
Investor shares:
NET ASSETS $1,370,922,717 $1,799,677,305
SHARES OUTSTANDING 59,988,457 66,675,497
------------------ ------------------
$22.85 $26.99
================== ==================
Institutional shares:
NET ASSETS $1,007,503 $2,453,084
SHARES OUTSTANDING 44,182 91,067
================== ==================
$22.80 $26.94
================== ==================
</TABLE>
2 See Notes to Financial Statements
<PAGE> 3
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- ------------------------------------------------------------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1997
(Unaudited)
<CAPTION>
LINDNER/RYBACK LINDNER
LINDNER UTILITY FUND SMALL-CAP FUND LINDNER BULWARK FUND INTERNATIONAL FUND
-------------------- -------------- -------------------- ------------------
<S> <C> <C> <C> <C>
ASSETS
Investment securities, at value:
Unaffiliated issuers (identified cost of
$804,381,116, $1,535,419,885,
$39,458,413, $36,946,580, $37,632,322 and
$3,296,974, respectively) $46,932,293 $44,679,006 $33,781,601 $3,517,911
Affiliated issuers (identified cost
$248,074,155, $78,554,834 and $2,692,016,
respectively) (Note 5) -- -- 1,136,644 --
Cash 141,663 165,268 69,567 26,699
Receivables:
Investments sold - long -- -- -- --
Dividends and interest 212,338 16,920 76,206 2,554
Fund shares sold -- 4,614 22,423 5,000
Investments sold - short -- -- 8,493,979 --
Deposits with brokers for securities sold short -- -- 6,884,941 --
Unamortized organizational expense (Note 4) 4,510 5,888 13,328 14,035
Receivable for expenses reimbursed by advisor -- -- -- 9,766
Other assets 775 320 276 753
--------------- --------------- --------------- --------------
Total assets 47,291,579 44,872,016 50,478,965 3,576,718
--------------- --------------- --------------- --------------
LIABILITIES
Accounts payable and accrued liabilities:
Investment securities purchased 170,311 190,557 29,280 --
Investment sold short, at value (proceeds
$8,091,035) -- -- 7,533,580 --
Short sales covered -- -- 620,844 --
Fund shares redeemed 4,099 28,094 524,233 21,634
Other liabilities:
Management fee (Note 3) 25,591 24,933 36,339 3,004
Organizational expense (Note 4) 9,250 8,417 17,952 14,356
Other 11,733 10,295 12,484 4,914
--------------- --------------- --------------- --------------
Total liabilities 220,984 262,296 8,774,712 43,908
--------------- --------------- --------------- --------------
NET ASSETS $47,070,595 $44,609,720 $41,704,253 $3,532,810
=============== =============== =============== ==============
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in
capital) $38,028,002 $36,282,863 $67,522,019 $3,536,690
Undistributed net investment income (loss) 37,144 (57,960) 27,163 (31,740)
Accumulated net realized gain (loss) on
investments and foreign currency
transactions 1,531,569 652,391 (20,995,290) (193,001)
Net unrealized appreciation (depreciation)
on investments and translation of assets and
liabilities in foreign currency 7,473,880 7,732,426 (4,849,639) 220,861
--------------- --------------- --------------- --------------
NET ASSETS TO OUTSTANDING SHARES $47,070,595 $44,609,720 $41,704,253 $3,532,810
=============== =============== =============== ==============
NET ASSET VALUE PER SHARE
Investor shares:
NET ASSETS $47,062,508 $44,380,074 $41,704,145 $3,532,438
SHARES OUTSTANDING 2,913,879 5,219,251 7,173,294 363,259
--------------- --------------- --------------- --------------
$16.15 $8.50 $5.81 $9.72
=============== =============== =============== ==============
Institutional shares:
NET ASSETS $8,087 $229,646 $108 $372
SHARES OUTSTANDNG 499 27,062 18 38
=============== =============== =============== ==============
$16.20 $8.49 $6.16 $9.66
=============== =============== =============== ==============
</TABLE>
See Notes to Financial Statements 3
<PAGE> 4
PERFORMANCE SUMMARY
Nearly 40 years ago, the famous baseball star Ted Williams was nearing the
end of his career with the Boston Red Sox. He was suffering from a pinched
nerve in his neck that season.
"The thing was so bad," he later explained,"that I could hardly turn my head
to look at the pitcher."
For the first time in his career, Williams had a batting average under .300
hitting just .254 with 10 homeruns. He was the highest salaried player in
sports, making $125,000. The next year, the Red Sox sent him a new contract
at the same salary level.
When he got the contract, Williams sent it back with a note saying that he
would not sign it until they gave him the full pay cut allowed.
"I was always treated fairly by the Red Sox when it came to contracts,"
Williams said. Now they were offering me a contract I didn't deserve. And I
only wanted what I deserved."
Williams cut his own salary by 25 percent, raised his batting average by 62
points, and closed out a brilliant career by hitting a home run in his final
at bat.
This is an analogy that we think relates well to your Lindner Growth Fund.
Looking back at 1997, it would be fair to say that the Fund "batted" well under
.300. Specifically, it returned 8.7% compared to the S&P 500 Index return of
33.4%.
One position that contributed to the Fund's lackluster performance was gold.
This commodity, which historically has been valued for its hedging
characteristics, saw a sharp price decline throughout the entire year. Large
foreign central banks initiated selling of their gold due to an almost
unprecedented lack of inflation in the U.S. economy. Prices of gold haven't
been this low since the late 1970s.
Another sector that affected the Fund's performance was in the Energy
industry. During the year, oil and natural gas prices declined due to a
number of circumstances including: the resumption of Iraqi oil into the world
supply; the fear of reduced demand from Asia; the announcement of OPEC quota
increases; and, a warmer than normal heating season. Despite last year's
events, we see this decline as temporary, and we have identified several
stocks that now appear extremely undervalued by our models.
We think it's important to communicate an example of an idea that worked and
one that was unsuccessful. An example of the latter scenario is TVX Gold. TVX
first was brought to our attention late in 1994. Our analysis showed that
this company had a consistently good record of buying gold deposits at
strategic locations. As time passed, however, it became evident that the
yield estimates of these deposits did not match the reality of what actually
was produced, all on top of a decline in the price of gold. We have since
sold our entire position in the stock.
(continued on next page)
Lindner Growth Fund
- -------------------
FUND PROFILE
This diversified fund seeks long-term capital appreciation through
investments in common stocks or securities convertible into common stocks.
Income is a secondary objective.
portfolio composition by industry
DECEMBER 31, 1997
[GRAPH]
4
<PAGE> 5
Conversely, Harken Energy Corporation, represents an example of our value
investing strategy that was successful last year. Harken engages in oil and
gas exploration, development and production operations, both domestically and
internationally. We began to purchase the stock a few years ago and continued
to add to our position as the company followed its growth plan and added and
improved their oil bearing acreage holdings in Columbia, South America. Our
average cost was less than $2.50 per share and the stock currently trades
around $7.00. As we monitor the situation we feel that the stock performance
will continue to reward us on the upside.
Looking ahead to 1998, it is our belief that there is reason for optimism in
the Lindner Growth Fund. We have reduced, considerably, the quantity of
positions we hold in the Fund: from a high of 216 to 173, currently. Not only
does this make the Fund less unwieldy to manage, but the stocks now in the
portfolio also represent the holdings that have our highest conviction.
Additionally, even though we reduced our position in gold mining companies
last year, we do believe the underlying commodity is at, or very near, a
bottom. During the fourth quarter, when the price fell off dramatically, we
tried to limit our downside by selling our high cost gold mining stocks while
adding to our positions in low cost gold production companies.
Last year also brought on a larger than normal capital gains payout. In
managing this fund, we are always mindful of after-tax returns and we
coordinate our holdings in an effort to minimize tax implications. However,
during our restructuring of the portfolio, and our reduction of the number of
owned securities, the sales from these transactions caused a higher capital
gains distribution. As we settle in to the portfolio, we anticipate that
realized capital gains, versus unrealized capital gains, will be curtailed
through our long-term buy and hold strategy.
As most of you are aware, 1997 saw the departure of one of the three managers
of the Growth Fund. As a refresher, the fund is being managed by Eric Ryback,
who has worked on the Fund since 1982, and Robert Lange, whose experience
managing the Growth Fund traces back to 1977. In addition, we are assisted by
our growing securities analyst team. Let us reassure you that since this
management change we are reinvigorated and refocused. We are working each and
everyday to return the Fund's performance to the high standards we have
always set for ourselves.
We want to end this letter by giving you some reasons why the Lindner Growth
Fund still makes sense as a part of your
portfolio.
1) You own a fund that has a 25-year track record of investing in all
market conditions.
2) You own a fund whose management has been overseeing its portfolio
for over 20 years through the best AND the worst investment
climates.
3) You own a unique fund whose advisor gets paid based upon the Fund's
performance. This means that, like the great Ted Williams in our
opening analogy, as we underperformed, the fund's advisor took a
33% pay cut from last year's fees. This is a very unique, and
frequently overlooked, program in the mutual fund industry
designed as a benefit for shareholders.
Last year was certainly humbling for us. Thank you for your patience and your
dedication to looking toward the long-term. Recovering from our respective
"pinched nerves," we will make every effort to have 1998 become comparable to
Ted Williams' 1960 rebound baseball season.
Sincerely,
/s/ Eric E. Ryback /s/ Robert A. Lange
Eric E. Ryback Robert A. Lange
President Portfolio Manager
5
<PAGE> 6
<TABLE>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER GROWTH FUND
- -------------------
COMMON STOCKS (86.77%)
Aerospace/Defense (3.40%)
Alliant Techsystems, Inc. <Fa>, <F*> 837,600 $46,696,200
-----------------
Automobiles and Parts (0.62%)
The Coast Distribution Company <Fa>, <F*> 501,000 $1,565,625
Jason, Inc. <F*> 865,000 6,920,000
-----------------
$8,485,625
-----------------
Business Services (0.73%)
Autoinfo, Inc. <F*> 106,900 $46,769
Scientific Software-Intercomp, Inc. <Fa>, <F*> 868,000 108,500
Superior Surgical Mfg. Company, Inc. <Fa> 497,000 7,952,000
Wave Technologies International, Inc. <Fa>, <F*> 262,500 1,935,938
-----------------
$10,043,207
-----------------
Chemicals and Allied Products (2.91%)
Ethyl Corporation 1,339,000 $10,293,563
Lawter International, Inc. 867,100 9,429,712
Solvay & Cie S.A. <Ff> 322,000 20,250,042
-----------------
$39,973,317
-----------------
Computers and Electronic Equipment (2.74%)
Gradco Systems, Inc. <Fa>, <F*> 776,000 $5,723,000
NCR Corporation <F*> 645,700 17,958,531
Unisys Corporation <F*> 1,000,000 13,875,000
-----------------
$37,556,531
-----------------
Construction and Real Estate (1.08%)
Blagovno Trgovinski Center - GDR - Rule 144A 290,000 $2,218,500
Butler Manufacturing Company 240,000 7,740,000
Fiberstars, Inc. <Fa>, <F*> 336,100 1,890,563
Mostostal Export Corporation
Common stock - ordinary shares <Ff> 634,400 1,601,733
Common stock - ADR 549,660 1,387,833
-----------------
$14,838,629
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Distributors (0.83%)
SED International Holdings, Inc. <Fa>, <F*> 1,007,500 $11,334,375
-----------------
Energy (11.46%)
Apache Corporation 300,000 $10,518,750
Barrington Petroleum Ltd. <Ff>, <F*> 1,105,500 3,553,669
Bitech Petroleum Corporation <Ff>, <F*>
Common stock <Ff>, <F*> 153,500 402,254
Common stock - Rule 144A <Ff>, <F*> 2,000,000 5,241,090
Harken Energy Corporation <F*> 2,900,000 20,300,000
Huntway Partners, L.P. <F*> 1,198,468 3,145,978
Lasmo plc - ADR 900,000 11,418,750
Lukoil Oil Company - ADR <F*> 17,000 1,572,500
Maynard Oil Company <Fa>, <F*> 487,700 4,998,925
Norex Industries, Inc. <F*> 1,253,100 25,688,550
Occidental Petroleum Corporation 540,000 15,828,750
Phillips Petroleum Company 400,000 19,450,000
Sasol Ltd. <Ff> 146,700 1,534,437
USX-Marathon Group 400,000 13,500,000
Weatherford Enterra, Inc. <F*> 459,216 20,090,700
-----------------
$157,244,353
-----------------
Environmental Services (1.18%)
Laidlaw Environmental Services, Inc. <F*> 1,569,100 $7,649,362
Recycling Industries, Inc. <Fa>, <F*> 1,042,000 6,252,000
Tanknology Environmental, Inc. <Fa>, <F*> 1,416,100 2,256,980
-----------------
$16,158,342
-----------------
Financial Services (6.99%)
Banco de Colombia S.A. - GDR - Rule 144A 250,000 $1,406,250
Bangkok Bank Public Company Ltd. <Ff> 250,000 623,072
Bank Inicjatyw Gospodarczych
Common stock <Ff>, <F*> 2,000,000 1,957,502
Common stock - GDR <F*> 338,000 5,154,500
Banque Libanaise pour le Commerce SAL
GDR - Rule 144A <F*> 200,000 3,630,000
CPB, Inc. 100,000 2,056,250
See Notes to Financial Statements
6
<PAGE> 7
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER GROWTH FUND
- -------------------
Financial Services (continued)
CORUS Bankshares, Inc. 664,958 $26,307,401
International Bancshares Corporation 488,340 37,358,010
John Nuveen and Company, Inc. 498,800 17,458,000
-----------------
$95,950,985
-----------------
Food and Beverage (0.87%)
Danone Group <Ff> 15,000 $2,680,442
Eskimo Pie Corporation <Fa> 245,000 2,817,500
Savannah Foods & Industries, Inc. 110,541 2,238,455
United Grain Growers Ltd. <Ff> 400,000 4,192,872
-----------------
$11,929,269
-----------------
Healthcare (1.77%)
Allied Healthcare Products, Inc. <Fa>, <F*> 655,200 $5,077,800
Comprehensive Care Corporation
Common Stock - Rule 144A <Fa>, <F*> 250,000 1,671,875
Common Stock <F*> 55,800 373,163
Creative Biomolecules, Inc. <F*> 712,400 5,253,950
Hyseq, Inc. - Rule 144A <Fa>, <F*> 720,000 5,788,800
Rightchoice Managed Care, Inc. <F*> 453,000 4,360,125
Slovakofarma, A.S. - GDR - Rule 144A <F*> 200,000 1,733,440
-----------------
$24,259,153
-----------------
Industrial Products and Services (3.38%)
Buderus AG <Ff> 5,000 $2,241,379
MFRI, Inc. <Fa>, <F*> 341,000 2,898,500
Quixote Corporation <Fa> 704,500 5,636,000
Tecumseh Products Company - Class B 125,000 6,109,375
Transtechnology Corporation <Fa> 300,000 8,493,750
Vitro, Sociedad Anonima - ADR <F*> 1,600,000 20,900,000
-----------------
$46,279,004
-----------------
Insurance (5.97%)
Acceptance Insurance Companies, Inc. <F*> 450,000 $10,884,375
Central Reserve Life Corporation 200,000 1,025,000
Gainsco, Inc. <Fa> 1,222,200 10,388,700
Hilb, Rogal and Hamilton Company <Fa> 1,000,000 19,312,500
John Alden Financial Corporation 250,100 6,002,400
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Insurance (continued)
Old Republic International Corporation 763,750 $28,401,953
PICO Holdings, Inc. <F*> 921,821 5,934,223
-----------------
$81,949,151
-----------------
Investments (2.23%)
Antofagasta Holdings P.L.C. <Ff> 950,000 $5,158,795
Dundee Bancorp, Inc. <Ff>, <F*> 300,400 6,318,686
Gateway Industries, Inc. <Fa>, <F*> 325,900 570,325
Minorco - ADR 1,110,000 18,592,500
-----------------
$30,640,306
-----------------
Leisure/Entertainment (3.71%)
American Classic Voyages Company <Fa>, <F*> 706,200 $12,799,875
Hasbro, Inc. 500,000 15,750,000
International Speedway Corporation, Class B 417,300 9,859,421
Jackpot Enterprises, Inc. 181,500 2,053,219
Matsushita Electric Industrial Co., Ltd <Ff> 125,000 1,836,242
Sotheby's Holdings, Inc. 467,600 8,650,600
-----------------
$50,949,357
-----------------
Metals Processing (0.43%)
Republic Engineered Steels, Inc. <F*> 882,500 $1,985,625
Seversky Tube Works - ADR <F*> 110,054 3,851,890
-----------------
$5,837,515
-----------------
Mining (5.58%)
Ashanti Goldfields Company, Ltd. - GDR 232,910 $1,746,825
Bema Gold Corporation <Ff>, <F*> 922,100 2,190,874
Canyon Resources Corporation <Fa>, <F*> 2,487,400 2,953,788
Case Pomeroy & Company, Inc.
Class A 2,165 2,381,500
Class B 538 625,425
Dayton Mining Corporation <Fa>, <Ff>, <F*> 2,611,300 4,926,981
Energy Resources of Australia Ltd <Ff> 1,925,905 5,270,607
Getchell Gold Corporation <F*> 139,800 3,355,200
Goldcorp Inc., Class A <F*> 903,600 3,560,184
Gold Reserve Corporation <Ff> <F*> 932,550 3,421,305
Greenstone Resources, Ltd. - Rule 144A <Ff>, <F*> 27,000 128,302
See Notes to Financial Statements
7
<PAGE> 8
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER GROWTH FUND
- -------------------
Mining (continued)
Homestake Mining Company 545,250 $4,839,094
Kinross Gold Corporation <Ff>, <F*> 950,000 3,265,625
Meridian Gold, Inc. <F*> 2,052,500 6,029,219
Newmont Gold Company 360,200 10,738,462
The Pioneer Group, Inc. 250,000 7,031,250
Prime Resources Group, Inc. <Ff> 350,000 2,323,550
Southernera Resources, Ltd. 617,900 6,174,682
Uranium Resources, Inc. <Fa>, <F*> 855,525 3,315,159
Vengold Inc. <Ff>, <F*> 2,450,900 2,226,534
-----------------
$76,504,566
-----------------
Oil & Gas Exploration (2.47%)
Sonat, Inc. 400,000 $18,300,000
Union Texas Petroleum Holdings, Inc. 750,000 15,609,375
-----------------
$33,909,375
-----------------
Paper, Printing and Publishing (1.20%)
American Media, Inc., Class A <Fa>, <F*> 2,117,900 $16,413,725
-----------------
Real Estate Investment Trust (1.67%)
Novastar Financial, Inc. 299,900 $4,742,169
Ramco-Gershenson Properties Trust <Fa> 500,000 9,843,750
Regency Realty Corporation 300,000 8,306,250
-----------------
$22,892,169
-----------------
Retail Trade (8.11%)
CML Group, Inc. 1,138,800 $3,772,275
CPI Corporation <Fa> 956,900 21,649,863
Charming Shoppes, Inc. <Fa>, <F*> 8,202,700 38,450,156
Cole National Corporation, Class A <F*> 445,000 13,322,187
Designs, Inc. <Fa>, <F*> 1,200,000 3,600,000
The Good Guys, Inc. <Fa>, <F*> 1,197,800 9,133,225
Juno Lighting, Inc. 380,000 6,650,000
Primesource Corporation 294,000 2,940,000
Uni-Marts, Inc. <Fa>, <F*> 597,000 2,089,500
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Retail Trade (continued)
United Retail Group, Inc. <Fa>, <F*> 1,036,600 $4,211,188
Zale Corporation <F*> 237,100 5,453,300
-----------------
$111,271,694
-----------------
Software (2.08%)
Novell, Inc. <F*> 3,804,500 $28,533,750
-----------------
Telecommunications (2.04%)
Comsat Corporation 736,000 $17,848,000
Vertex Communications Corporation <Fa>, <F*> 420,000 10,132,500
-----------------
$27,980,500
-----------------
Transportation (5.98%)
Anangel-American Shipholdings Ltd. <F*> 718,900 $6,290,375
Kirby Corporation <F*> 400,000 7,725,000
London & Overseas Freighters Ltd. - ADR <Fa> 405,500 6,183,875
MIF Ltd., ADR - Rule 144A <F*> 306,000 5,437,528
Oglebay Norton Company 178,744 7,328,504
OMI, Inc. <Fa>, <F*> 2,175,000 19,982,813
Overseas Shipholding Group, Inc. 791,300 17,260,231
Petroleum Helicopters, Inc.
Non-voting common 143,500 3,336,375
Voting common 66,500 1,479,625
Stolt-Nielsen S.A. - ADR 230,000 5,031,250
Wah Kwong Shipping Holdings Ltd. <Ff> 3,025,759 1,991,607
-----------------
$82,047,183
-----------------
Utilities (4.07%)
El Paso Electric Company <F*> 1,873,200 $13,697,775
Houston Industries, Inc. 1,199,408 32,009,201
Huaneng Power International - ADR <F*> 222,700 5,163,856
Lenenergo - RDC - Rule 144A <F*> 18 1,215,000
Unified Energy Systems - Reg S - ADR <F*> 125,000 3,781,250
-----------------
$55,867,082
-----------------
See Notes to Financial Statements
8
<PAGE> 9
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER GROWTH FUND
- -------------------
Miscellaneous (3.27%) $44,816,414
-----------------
Total Common Stocks (Cost $877,684,928) $1,190,361,777
-----------------
PREFERRED STOCKS (0.69%)
Business Services (0.44%)
Interleaf, Inc., Series C, convertible -
Rule 144A <F*> 505,174 $6,041,881
-----------------
Energy (0.06%)
Westmoreland Coal Company, 8.50% voting convertible <Fa>, <F#> 159,700 $828,444
-----------------
Healthcare (0.15%)
Comprehensive Care Corp., 4%, convertible - Rule 144A 41,260 $2,089,819
-----------------
Mining (0.04%)
Ashanti Goldfields Company, Ltd.
$0.648, Series A 204,517 $128,192
$0.648, Series B 204,517 116,043
$0.648, Series C 204,517 105,040
$0.648, Series D 204,517 95,100
$0.648, Series E 204,517 86,081
-----------------
$530,456
-----------------
Total Preferred Stocks (Cost $10,441,485) $9,490,600
-----------------
NON-CONVERTIBLE BONDS (0.95%)
Energy (0.27%)
Huntway Partners L.P., 12%, due 2005 -
Rule 144A $3,697,696 $3,697,696
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Financial Services (0.68%)
Beal Financial Corporation, 12.75%, due 2000 $5,675,000 $6,100,625
WSFS Financial Corporation, 11%, due 2005 3,050,000 3,248,250
-----------------
$9,348,875
-----------------
Total Non-Convertible Bonds (Cost $12,708,293) $13,046,571
-----------------
CONVERTIBLE BONDS (0.58%)
Mining (0.08%)
Dayton Mining Corporation, 7%, due 2002 - Rule 144A <Ff> $1,500,000 $1,095,000
-----------------
Telecommunications (0.50%)
Metricom, Inc., 8%, due 2003 $7,500,000 $6,900,000
-----------------
Total Convertible Bonds (Cost $9,000,000) $7,995,000
-----------------
U.S. TREASURY BILLS (10.40%)
Maturing 1-8-98 to 2-12-98 (Cost $142,620,565) $143,100,000 $142,656,863
-----------------
Total Investments (Cost $1,052,455,271) 99.39% $1,363,550,811
Excess of Other Assets over Liabilities 0.61% $8,379,409
------------------ -----------------
Net Assets 100.00% $1,371,930,220
================== =================
<FN>
<F*> Non-income producing
<Fa> Denotes security is affiliated (See Note 6)
<Ff> Denotes security primarily traded in foreign markets
<F#> Dividends are in arrears.
ADR American Depository Receipts
GDR Global Depository Receipts
See Notes to Financial Statements
</TABLE>
9
<PAGE> 10
PERFORMANCE SUMMARY
The Lindner Dividend Fund finished the calendar year ended
December 31, 1997, with a total return of 14.0% compared to the
S&P 500's total return of 33.4%. During the same time period, the
yield on the 30-year treasury fund declined from 6.64% to 5.92%. I
am pleased to report the average portfolio yield is 6% which compares very
favorably to the one year treasury bill rate of 5.5%.
Since the beginning of the third quarter, the Fund has been changing its
composition of stocks, bonds and convertible preferreds in order to place more
emphasis on its primary objective of producing current income. During the first
half of the year, the Fund's non-income producing securities reached a
historically high level of 12% of the portfolio. Originally, the intent was to
allow the Fund to participate more in the raging bull market, when, in fact,
just the opposite occurred. Recognizing our error toward 1997's fourth quarter,
the non-income producing securities were reduced to 5.2% of the portfolio. The
proceeds from these sales were used to purchase high-yielding convertible
preferred stock and high-yielding corporate bonds. To further our efforts, the
Dividend Fund increased the percentage of utility stocks from 13.01% as of June
30, 1997, to a year-end position of 23.25% of the portfolio.
The percentage of convertible preferred stock increased from 22% as of June 30,
1997, to 30.2% on December 31, 1997. The high-yielding corporate bonds increased
from 14% to 17.3% during the same period. From the beginning of September to the
end of the year, the Fund reduced the number of holdings in the portfolio by 48,
bringing the year end total number of holdings to 112. This was done to take
gains on the securities we felt had reached their investment return objectives.
It also made the Fund less cumbersome to manage. We decided to concentrate on
securities that we feel have strong future earning potential and limited
downside risk provided by their high yields.
During the calendar year we reduced the Dividend Fund's exposure in Energy,
Telecommunications, and the Retail Trade industries. The Fund also increased
its positions in the Broadcast/Media, and the Computer and Electronic
Equipment sectors. The Fund also entered a new industry: Airlines. Our
analysis identified an international carrier, TWA, as being very undervalued.
The past year has been a difficult one for the Dividend Fund as interest rates
have dropped to their lowest levels in the past 20 years. The number of good
high-yield value ideas has become very limited, however, we continue to ferret
out the exceptions. The Fund's yield, as mentioned in the beginning of this
letter, has held up well in this declining interest rate environment. With the
last quarter's restructuring of the portfolio, the Fund has increased its
defensive stance in order to combat a potential down market while increasing
the portfolio's yield.
Thank you for your continued interest in the Lindner Dividend Fund. We will
make every effort to try to provide you with a steady source of income without
incurring undue risk.
Sincerely,
/s/ Eric E. Ryback
Eric E. Ryback
President
Lindner Dividend Fund
- -------------------------
FUND PROFILE
This fund's primary objective is to generate current income; capital
appreciation is a secondary goal. Investments include common stocks,
convertible and non-convertible preferred stocks and corporate bonds, and
debt securities issued or guaranteed by the U.S. government or its agencies.
portfolio composition by
investment category
December 31, 1997
[GRAPH]
10
<PAGE> 11
<TABLE>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER DIVIDEND FUND
- ---------------------
COMMON STOCKS (38.38%)
Broadcast/Media (0.13%)
Tescorp, Inc. <F*> 507,700 $2,252,919
-----------------
Chemicals (1.54%)
Engelhard Corporation 1,600,000 $27,800,000
-----------------
Energy (4.67%)
Bitech Petroleum Corporation <Fa>, <Ff>, <F*> 2,696,895 $7,067,335
Harken Energy Corporation <Fa>, <F*> 7,000,000 49,000,000
Teco Energy, Inc. 1,000,000 28,125,000
-----------------
$84,192,335
-----------------
Financial Services (1.52%)
American Bank of Connecticut <Fa> 122,300 $5,954,481
John Nuveen and Company, Inc. 611,300 21,395,500
-----------------
$27,349,981
-----------------
Healthcare (0.27%)
Hyseq, Inc. - Rule 144A <F*> 600,000 $4,824,000
-----------------
Investments (1.11%)
Minorco - ADR 1,200,000 $20,100,000
-----------------
Leisure/Entertainment (0.82%)
Hasbro, Inc. 468,550 $14,759,325
-----------------
Mining (1.11%)
Cameco Corporation (f) 515,000 $16,698,812
Uranium Resources, Inc.
Common stock <Fa>, <F*> 339,000 1,313,625
Common stock <Fa>, <F*>, <Fr> 500,000 1,937,500
-----------------
$19,949,937
-----------------
Oil & Gas Exploration (2.03%)
Sonat, Inc. 800,000 $36,600,000
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Real Estate Investment Trusts (1.40%)
Hanover Capital Mortgage Holdings, Inc.,
-Units <Fa> 400,000 $6,600,000
Ramco-Gershenson Properties Trust 118,475 2,332,477
Redwood Trust, Inc. <Fa> 800,000 16,300,000
-----------------
$25,232,477
-----------------
Telecommunications (1.25%)
Koninklijke PTT Nederland NV -
Rule 144A <Ff> 540,000 $22,535,517
-----------------
Transportation (0.76%)
Transportacion Maritima Mexicana - ADR 1,871,100 $13,799,362
-----------------
Utilities (Gas, Electric & Water) (20.64%)
DTE Energy Company 1,000,000 $34,687,500
Dominion Resources, Inc. 1,000,000 42,562,500
El Paso Electric Company <Fa>, <F*> 3,700,700 27,061,369
First Energy Corporation (formerly Ohio Edison Company) 1,000,000 29,000,000
P P&L Resources, Inc. 2,000,000 47,875,000
Pacific Gas and Electric Company 750,000 22,828,125
Potomac Electric 1,000,000 25,812,500
Public Service Enterprise Group, Inc. 1,500,000 47,531,250
The Southern Company 900,000 23,287,500
Texas Utilities Company 775,000 32,210,937
Union Electric Company 250,000 10,812,500
Western Resources, Inc. 659,700 28,367,100
-----------------
$372,036,281
-----------------
Miscellaneous (1.13%) $20,242,356
-----------------
Total Common Stocks (Cost $588,537,477) $691,674,490
-----------------
See Notes to Financial Statements
11
<PAGE> 12
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER DIVIDEND FUND
- ---------------------
PREFERRED STOCKS (36.21%)
Airline (2.18%)
Transworld Airlines, Inc., $4.625 100,000 $6,525,000
Transworld Airlines, Inc., 8% convertible 900,000 32,850,000
-----------------
$39,375,000
-----------------
Broadcast/Media (2.56%)
Cablevision Systems Corporation,
8.5% convertible 1,200,000 $46,200,000
-----------------
Computer and Electronic Equipment (5.34%)
The Titan Corporation, $1.00 convertible 70,300 $953,444
Unisys Corporation, $3.75 convertible 1,800,000 81,112,500
Vanstar Financing Trust, 6.75% convertible 366,000 14,091,000
-----------------
$96,156,944
-----------------
Construction and Real Estate (0.83%)
LSB Industries, Inc., $3.25 convertible 423,900 $14,995,462
-----------------
Energy (9.67%)
ICO, Inc., $1.6875 convertible 442,500 $10,066,875
Lasmo PLC, Series A, 10% 492,600 12,930,750
Maxus Energy Corporation, 10% 200,000 5,237,500
McDermott International, Inc.,
$2.20 convertible 319,200 12,129,600
5.75% convertible - Rule 144A 662,500 36,603,125
Occidental Petroleum Corporation,
$3.875 convertible - Rule 144A 600,000 38,925,000
Tejas Gas Corporation, $2.49 349,700 8,917,350
Western Gas Resources, Inc.,
$2.65 convertible 1,209,800 49,450,575
-----------------
$174,260,775
-----------------
Financial Services (1.40%)
ARM Financial Group, Inc., 9.5% 140,000 $3,657,500
Community Bank, Series B, 13% 196,500 5,502,000
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Financial Services (continued)
Credit Lyonnais Capital S.C.A., 9.5% -
Rule 144A 600,000 $16,050,000
-----------------
$25,209,500
-----------------
Food Distribution (1.04%)
Chiquita Brands International, Inc.,
Series A, $2.875 368,000 $18,837,000
-----------------
Metals Processing (2.86%)
Armco Inc., $3.625 convertible 312,400 $14,604,700
USX Corporation, 6.5% convertible 802,700 36,924,200
-----------------
$51,528,900
-----------------
Mining (2.89%)
Battle Mountain Gold Company, $3.25 55,000 $2,475,000
Freeport-McMoran Copper & Gold, Inc.,
Series B, variable rate 12,100 290,400
Series C, variable rate 751,700 17,101,175
Pittston Company, $3.125 convertible -
Rule 144A 825,200 32,182,800
-----------------
$52,049,375
-----------------
Paper, Printing and Publishing (0.34%)
Interleaf, Inc., Series C, convertible -
Rule 144A <F*> 505,174 $6,041,881
-----------------
Real Estate Investment Trusts (1.25%)
Novastar Financial, Inc., Class A convertible and stock
purchase warrant - Rule 144A 666,667 $10,541,672
Prime Retail, Inc.,
$2.125 convertible 202,600 4,862,400
$2.625 260,000 7,085,000
-----------------
$22,489,072
-----------------
Retail Trade (0.72%)
Designer Holdings Ltd., 6% 300,000 $12,900,000
-----------------
See Notes to Financial Statements
12
<PAGE> 13
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER DIVIDEND FUND
- ---------------------
Steel Production (1.62%)
Bethlehem Steel Corporation, $3.50
convertible 712,500 $29,212,500
-----------------
Transportation (0.93%)
Sea Containers Ltd., $4.00 convertible 300,000 $16,725,000
-----------------
Utilities (Gas, Electric & Water) (1.19%)
Central Maine Power Company,
4.75% 8,300 $452,931
5.25% 42,500 2,563,600
Cleveland Electric Illuminating Company, Series S, 9% 16,000 17,200,000
Texas-New Mexico Power Company, 4.65% 16,300 1,217,447
-----------------
$21,433,978
-----------------
Miscellaneous (1.39%) $25,129,556
-----------------
Total Preferred Stocks (Cost $595,432,718) $652,544,943
-----------------
NON-CONVERTIBLE BONDS (17.29%)
Aerospace/Defense (0.61%)
Alliant Techsystems, Inc., 11.375%, due 2003 $10,000,000 $11,037,500
-----------------
Airline (0.61%)
Transworld Airlines, Inc., 12%, due 2002 $10,750,000 $10,911,250
-----------------
Apparel & Other Textile Products (0.89%)
Hartmarx Corporation, 10.875%, due 2002 $15,555,000 $16,099,425
-----------------
Computer and Electronic Equipment (0.08%)
Scientific Software-Intercomp, Inc., 7% Note, due 2001 with
warrants attached - Rule 144A $5,000,000 $1,250,000
Streamlogic Corporation, 14%, due 1998 <F##> 832,976 166,596
-----------------
$1,416,596
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Construction and Real Estate (1.24%)
Avatar Holdings, Inc., 9%, due 2000 $4,168,000 $4,042,960
Congoleum Corporation, 9%, due 2001 7,700,000 7,834,750
Kaufman & Broad Home Corporation, 9.375%, due 2003 10,000,000 10,425,000
-----------------
$22,302,710
-----------------
Engineering and Manufacturing (0.11%)
Rohr, Inc., 9.25%, due 2017 $2,000,000 $2,060,000
-----------------
Financial Services (3.37%)
Beal Financial Corporation, 12.75%, due 2000 $27,500,000 $29,562,500
Mego Mortgage Corporation
12 1/2%, due 2001 6,000,000 5,010,000
12 1/2%, due 2001 - Rule 144A 5,000,000 4,175,000
TeleBanc Financial Corporation, 11.5%, due 2004 1,500,000 1,500,000
WSFS Financial Corporation, 11%, due 2005 19,150,000 20,394,750
-----------------
$60,642,250
-----------------
Industrial Products and Services (0.92%)
Fruehauf Trailer Corporation, 14.75%, due 2002 <F##> $20,000,000 $16,600,000
-----------------
Mining (1.47%)
Kaiser Aluminum & Chemical Corporation, 9.875%, due 2002 $25,500,000 $26,520,000
-----------------
Paper, Printing and Publishing (1.00%)
United States Banknote Corporation, 10.375%, due 2002 $18,100,000 $18,100,000
-----------------
Retail (0.22%)
Michaels Stores, Inc., 10.875%, due 2006 $3,500,000 $3,885,000
-----------------
See Notes to Financial Statements
13
<PAGE> 14
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER DIVIDEND FUND
- ---------------------
Satellite Communications (1.91%)
Iridium World Communications Ltd.,
13%, due 2005 - Rule 144A $12,000,000 $12,600,000
14%, due 2005 - Rule 144A 20,000,000 21,800,000
-----------------
$34,400,000
-----------------
Transportation (2.61%)
Global Ocean Carriers Ltd., 10.25%, due 2007 $20,000,000 $19,200,000
International Shipholding Corporation, 9%, due 2003 2,000,000 2,060,000
Transportacion Maritima Mexicana, S.A. de C.V., 9.25%, due 2003 26,100,000 25,773,750
-----------------
$47,033,750
-----------------
Utilities (Gas, Electric & Water) (1.42%)
Gascart, 9%, due 1998 - Rule 144A $16,224,000 $15,737,280
Public Service Company of New Mexico, 10.3%, due 2014 3,258,000 3,477,915
Texas-New Mexico Power Company, 9.25%, due 2000 6,000,000 6,347,454
-----------------
$25,562,649
-----------------
Miscellaneous (0.83%) $14,952,463
-----------------
Total Non-Convertible Bonds
(Cost $308,711,730) $311,523,593
-----------------
CONVERTIBLE BONDS (6.40%)
Computer and Electronic Equipment (0.94%)
Richey Electronics, Inc., 7%, due 2006 $17,095,000 $16,924,050
-----------------
Leisure and Entertainment (0.42%)
Savoy Pictures Entertainment, Inc., 7%,
due 2003 (HSN Inc.) $8,071,000 $7,546,385
-----------------
Mining (0.23%)
Atlas Corporation, 9%, due 1998 -
Rule 144A $3,500,000 $280,000
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Mining (continued)
Uranium Resources, Inc., 6.5%, due 1998 - Rule 144A $4,500,000 $3,912,750
-----------------
$4,192,750
-----------------
Retail Trade (1.47%)
Charming Shoppes, 7.5%, due 2006 $28,025,000 $26,588,719
-----------------
Telecommunications (2.43%)
International CableTel Inc., 7%, due 2008 - Rule 144A $30,000,000 $29,962,500
Metricom Inc., 8%, due 2003 15,000,000 13,800,000
-----------------
$43,762,500
-----------------
Miscellaneous (0.91%) $16,396,250
-----------------
Total Convertible Bonds (Cost $117,903,379) $115,410,654
-----------------
U.S. TREASURY BILLS (0.19%)
Maturing 1/8/98 (Cost $3,389,415) $3,400,000 $3,390,555
-----------------
Total Investments (Cost $1,613,974,719) 98.47% $1,774,544,235
Excess of Other Assets over Liabilities 1.53% $27,586,154
------------------ -----------------
Net Assets 100.00% $1,802,130,389
================== =================
<FN>
<F*> Non-income producing
<Fa> Denotes security is affiliated (See Note 6)
<Ff> Denotes security primarily traded in foreign markets
<Fr> Denotes registered but restricted shares
<F#> Dividends are in arrears.
<F##>Denotes bond is in default
ADR American Depository Receipts
See Notes to Financial Statements
</TABLE>
14
<PAGE> 15
Lindner Utility Fund
- --------------------
FUND PROFILE
This fund seeks current income through investments in securities of domestic
and foreign public utility companies, with capital appreciation as a
secondary goal. Utilities are broadly defined to include companies that
provide basic services on a regular basis.
portfolio composition by industry
DECEMBER 31, 1997
[GRAPH]
PERFORMANCE SUMMARY
During the calendar year of 1997, the Lindner Utility Fund advanced 19.6%.
This compares to a total return of 23.2% and 34.1% by the Dow Jones and New
York Stock Exchange utility indices, respectively. Regrettably, we
underperformed relative to these benchmarks, primarily in the last quarter of
the year. The reasons for this are twofold.
First, as it has become one of our hallmarks, we search out securities that
add value by trading at a discount to what our analysis determines they are
truly worth. Using this discipline, we identified value in the energy
industry as oil and natural gas prices declined. Unfortunately, as we
increased our exposure, situations arose that temporarily weakened this
sector, including: a warmer than normal heating season, an announced increase
in OPEC quotas, the resumption of Iraqi flow of crude into the world supply
and the fear of slackened demand in Asia. While these are real concerns, we
are comfortable buying select companies that have shown the ability to
prosper even when commodity pricing has been weak. Nonetheless, when the tide
goes out in a sector, all boats are taken down. Over time, this will change.
Value will win out and we will own some excellent energy companies at very
attractive levels.
As we alluded to earlier, the other stumbling block for the last quarter was
the unfolding Asian Crisis. While we had no direct exposure to this region,
the market punished virtually all of the emerging economic markets. Our
exposure to the FSU (Former Soviet Union countries) and Latin America
(Argentina, Brazil and Columbia) has caused an underperformance in the Fund's
international securities. However, we remain steadfast in our belief that we
live in an increasingly global economy and we will continue to seek out value
in the "basic need" industries. Going forward, we expect to see a
normalization in the utility markets and we will continue to monitor and seek
out those companies that should prosper in a new global, deregulated, and
competitive environment.
We developed the Lindner Utility Fund with the idea that we would be a more
diversified alternative to ordinary utility funds that rise and fall with the
fluctuations of interest rates. For this reason, you will often see companies
in our portfolio involved in industries that are peripheral to the
traditional utility industry. We do this to allow the Fund to be able to
benefit when traditional utilities are out of favor. We will continue this
approach as we continue to see our economy becoming more of a service
oriented economy, of which traditional utilities are only a small part.
In the meantime, we continue to search for the right mix of assets that we
feel will expose the Fund to "value investing" in the utility industry. After
all, that is why you have chosen to invest in the Lindner Family of Funds.
As always, we are most appreciative of your continued support over the years.
Sincerely,
/s/ Eric E. Ryback /s/ Rick Eckenrodt, Jr.
Eric E. Ryback Rick Eckenrodt, Jr.
President Portfolio Manager
15
<PAGE> 16
<TABLE>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER UTILITY FUND
- --------------------
COMMON STOCKS (71.39%)
Cable Television Equipment/Systems (2.83%)
Tescorp, Inc. <F*> 300,000 $1,331,250
-----------------
Electrical Generation (1.48%)
NRG Generating (U.S.), Inc. <F*> 35,000 $695,625
-----------------
Energy (14.81%)
Bitech Petroleum Corporation <F*>, <Ff> 310,000 $812,369
Harken Energy Corporation <F*> 525,000 3,675,000
Seagull Energy Corporation <F*> 80,000 1,650,000
Union Texas Petroleum Holdings, Inc. 40,000 832,500
-----------------
$6,969,869
-----------------
Energy Service (1.14%)
Perez Companc S.A. - ADR <F*> 75,000 $534,750
-----------------
Foreign Telecommunications (0.73%)
AI Uralsvyazinform - ADR <F*> 30,000 $344,151
-----------------
Industrial Products and Services (1.11%)
Seversky Tube Works - ADR <F*> 15,000 $525,000
-----------------
Mining (1.65%)
Uranium Resources, Inc. <F*> 200,000 $775,000
-----------------
Natural Gas Exploration & Production (1.99%)
Louis Dreyfus Natural Gas Corporation <F*> 50,000 $934,375
-----------------
Natural Gas Distribution (1.44%)
CMS Energy Corporation - Class G 25,000 $678,125
-----------------
Natural Gas Pipeline (1.81%)
Continental Natural Gas, Inc. <F*> 79,500 $854,625
-----------------
Oil Service - Drilling (1.07%)
Pride International, Inc. <F*> 20,000 $505,000
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Telecommunication Equipment & Service (1.47%)
Radiotronica, S.A. <F*>, <Ff> 50,000 $693,828
-----------------
Utilities (Gas, Electric & Water) (34.93%)
Duke Power Company 30,000 $1,661,250
El Paso Electric Company <F*> 273,000 1,996,313
FirstEnergy Corporation (formerly Ohio Edison Company) 50,000 1,450,000
Illinova Corporation 35,000 942,812
Irkutskenergo - ADR 50,000 492,720
Lenenergo - RDC - Rule 144A <F*> 10 675,000
Pacific Gas and Electric Company 50,000 1,521,875
Pacificorp 40,000 1,092,500
Rao Gazprom - ADR - Rule 144A <F*> 30,000 723,900
Teco Energy, Inc. 50,000 1,406,250
Texas Utilities Company 25,000 1,039,062
Unified Energy Systems - Reg S - ADR <F*> 28,150 851,538
Union Electric Company 30,000 1,297,500
Western Resources, Inc. 30,000 1,290,000
-----------------
$16,440,720
-----------------
Miscellaneous (4.93%) $2,319,381
-----------------
Total Common Stocks (Cost $28,451,540) $33,601,699
-----------------
PREFERRED STOCKS (17.19%)
Cable Television Equipment/Systems (7.36%)
Cablevision Systems Corporation, Series I, 8.50% convertible 90,000 $3,465,000
-----------------
See Notes to Financial Statements
16
<PAGE> 17
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER UTILITY FUND
- --------------------
Energy (5.15%)
Lukoil Holdings - Preference - ADR - Rule 144A <F*> 15,000 $480,000
Maxus Energy, 10% 15,000 392,811
Western Gas Resources, Inc., $2.625 38,000 1,553,250
-----------------
$2,426,061
-----------------
Media Broadcasting (2.43%)
Sinclair Broadcast Group, Inc., 6% 20,000 $1,140,000
-----------------
Utilities (Gas, Electric & Water) (2.25%)
Central Maine Power Company,
4.75% 11,096 $605,509
5.25% 7,500 452,400
-----------------
$1,057,909
-----------------
Total Preferred Stocks (Cost $5,974,435) $8,088,970
-----------------
NON-CONVERTIBLE BONDS (2.23%)
Satellite Communications (2.23%)
Iridium World Communications Ltd.,
13%, due 2005 $1,000,000 $1,050,000
-----------------
Total Non-Convertible Bonds (Cost $979,164) $1,050,000
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
CONVERTIBLE BONDS (4.24%)
Cable Television Equipment/Systems (4.24%)
International CableTel, Inc., 7%, due 2008 $2,000,000 $1,997,500
-----------------
Total Convertible Bonds (Cost $1,859,715) $1,997,500
-----------------
U. S. TREASURY BILLS (4.66%)
Maturing 1-15-98 to 1-22-98 (Cost $2,193,559) $2,200,000 $2,194,124
-----------------
Total Investments (Cost $39,458,413) 99.71% $46,932,293
Excess of Other Assets over Liabilities 0.29% $138,302
------------------ -----------------
Net Assets 100.00% $47,070,595
================== =================
<FN>
<F*> Non-income producing
<Ff> Denotes security primarily traded in foreign markets
ADR American Depository Receipts
GDR Global Depository Receipts
RDC Russian Depository Receipts
See Notes to Financial Statements
</TABLE>
17
<PAGE> 18
PERFORMANCE SUMMARY
For the calendar year ended December 31, 1997, the Lindner/Ryback Small Cap
Fund's total return was 31.7%. This compares to the Russell 2000 Index of
Small Capitalization stocks' total return of 22.2% for the same period. Over
the past two years, our pretax compounded return has been 36.2% versus 19.4%
for the Russell 2000 over the same time period. Given our value-based
methodology, we expect this would be as pleasant a surprise for you as it has
been for us. However, we think it would be unrealistic to expect similar
returns in the future for the following reasons:
First, our focus is on after-tax, not pre-tax returns. This makes us
reluctant to sell our winners and realize capital gains unnecessarily. The
risk in this strategy is that we are willing to hold onto businesses that
have superior economics and/or management but whose underlying stocks may
have modest near term prospects. This can penalize short term results, but if
we are correct regarding the long term prospects of these businesses, our
patience will be well rewarded. Our adherence to this strategy has allowed
our estimated after-tax returns over the past two years to be very close to
our pretax returns--approximately 35% (applying a 50% marginal tax rate).
Lastly, there are other issues besides the tax implications that make us
cautious in selling our winners, the most prominent of which is the reinvestment
risk created. Given the difficulty in finding situations in which to invest, it
would be counterproductive to constantly turnover the portfolio hoping to find
suitable businesses to replace the ones we sold.
Second, the cash position currently in the fund is 18% which includes one
arbitrage situation. This level is somewhat higher than our average cash
position was throughout 1997. This is not a market-timing decision but rather
our current inability to find the kinds of companies we want to own at
reasonable prices. We would gladly be fully invested if and when the
opportunity presents itself. However, our large cash position could inhibit
performance should the market continue to be ebullient.
Third, opportunities in both the existing positions and our success at
finding new ideas are more limited as compared to a year ago. Many of the
positions we own have less upside remaining while it is "slim pickings" in
terms of new ideas we would like to invest in at the prices we would like to
pay. Clearly, we are not as cheerful about the future as the past two years
might lead one to believe.
Unfortunately, two of the aforementioned factors have impacted us during the
past three months resulting in performance that has been as poor as the
small-cap market overall during this period. These results are contrary to
what we would have expected as it has long been our goal to outperform in
bear markets while maintaining competitive returns in bull markets (the last
two years being somewhat of an anomaly). Nonetheless, we believe our
investment philosophy, based on free cash flow and asset value, to be a sound
one designed to perform well in down markets. We remain steadfast in the
belief that our strategy will reward us in the long-run. As always, we are
grateful for your patience and support.
Sincerely,
/s/ Eric E. Ryback /s/ Donald Wang
Eric E. Ryback Donald Wang
President Portfolio Manager
Lindner/Ryback
Small-Cap Fund
- ---------------------
FUND PROFILE
The investment objective of this fund is long-term capital appreciation
through investments in common stocks or convertible securities of companies
with market capitalization of $750 million or less. Income is a secondary
objective.
portfolio composition by industry
DECEMBER 31, 1997
[GRAPH]
18
<PAGE> 19
<TABLE>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER/RYBACK SMALL-CAP FUND
- -----------------------------
COMMON STOCKS (87.63%)
Asset Management (1.00%)
Lexington Global Asset Managers, Inc. <F*> 48,800 $445,300
-----------------
Cabletelevision Systems (5.62%)
Scandinavian Broadcasting System S.A. <F*> 33,000 $808,500
Tescorp, Inc. <F*> 383,400 1,701,338
-----------------
$2,509,838
-----------------
Commercial Services (0.91%)
Duff & Phelps Credit Rating Company 10,000 $406,250
-----------------
Consumer (5.60%)
AJL PEPS Trust 106,600 $1,172,600
Fairfield Communities, Inc. <F*> 30,000 1,323,750
-----------------
$2,496,350
-----------------
Distributors (12.79%)
Aviall, Inc. <F*> 160,000 $2,390,000
Hawkins Chemical, Inc. 93,200 1,077,625
Richey Electronics, Inc. <F*> 125,000 1,281,250
SED International, Inc. (formerly Southern Electronics) <F*> 85,000 956,250
-----------------
$5,705,125
-----------------
Electronic Equipment (2.23%)
Optek Technology, Inc. <F*> 49,800 $992,887
-----------------
Energy (5.32%)
Castle Energy Corporation 110,000 $1,533,125
Plains Resources, Inc. <F*> 49,000 842,187
-----------------
$2,375,312
-----------------
Food and Beverage (2.75%)
Corby Distilleries Ltd., Class A <Ff> 27,000 $1,226,340
-----------------
Health and Beauty (2.27%)
The Stephan Company 76,000 $1,011,750
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Insurance (5.29%)
Cotton States Life Insurance Company 55,000 $1,258,125
Hilb, Rogal and Hamilton Company 57,000 1,100,813
-----------------
$2,358,938
-----------------
Manufacturing (5.92%)
Material Sciences Corporation <F*> 30,000 $365,625
MFRI, Inc. <F*> 68,500 582,250
Quixote Corporation 109,000 872,000
Transtechnology Corporation 29,000 821,063
-----------------
$2,640,938
-----------------
Mining (0.44%)
Uranium Resources, Inc. <F*> 50,000 $193,750
-----------------
Paper, Printing and Publishing (2.38%)
American Media, Inc., Class A <F*> 137,000 $1,061,750
-----------------
Pipeline Services (2.84%)
Kaneb Services, Inc. <F*> 244,500 $1,268,344
-----------------
Real Estate Services (5.53%)
Lexford, Inc. <F*> 29,000 $1,000,500
Resurgence Properties, Inc. <F*> 51,400 89,950
Tanger Factory Outlet Centers, Inc. - REIT 45,000 1,375,313
-----------------
$2,465,763
-----------------
Restaurants (4.71%)
Host Marriott Services Corporation <F*> 100,000 $1,487,500
Scott's Restaurants, Inc. <F*>, <Ff> 175,200 612,159
-----------------
$2,099,659
-----------------
Retail Trade (6.65%)
Brauns Fashions Corp. <F*> 152,000 $1,577,000
Fingerhut Companies, Inc. 65,000 1,389,375
-----------------
$2,966,375
-----------------
See Notes to Financial Statements
19
<PAGE> 20
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER/RYBACK SMALL-CAP FUND
- -----------------------------
Tobacco Products (7.65%)
M & F Worldwide Corporation (formerly Power Control
Technologies, Inc.) <F*> 215,100 $2,110,669
Schweitzer-Mauduit International, Inc. 35,000 1,303,750
-----------------
$3,414,419
-----------------
Utilities (Gas, Electric & Water) (7.73%)
El Paso Electric Company <F*> 177,000 $1,294,312
NRG Generating (U.S.), Inc. <F*> 108,500 2,156,437
-----------------
$3,450,749
-----------------
Total Common Stocks (Cost $31,358,548) $39,089,837
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
U.S. TREASURY BILLS (12.53%)
U. S. Treasury Bills, maturing 1-8-98 to
1-22-98 (Cost $5,588,032) $5,600,000 $5,589,169
-----------------
Total Investments (Cost $36,946,580) 100.16% $44,679,006
Excess of Other Liabilities over Assets -0.16% ($69,286)
------------------ -----------------
Net Assets 100.00% $44,609,720
================== =================
<FN>
<F*> Non-income producing
<Ff> Denotes security primarily traded in foreign markets
REIT - Real Estate Investment Trust
See Notes to Financial Statements
</TABLE>
20
<PAGE> 21
Lindner Bulwark
Fund
- ---------------
FUND PROFILE
This non-diversified fund is designed to preserve capital in times of
economic adversity, with current income as a secondary objective. Investments
include undervalued securities and precious metals, which have historically
maintained their value when fixed income and equity markets are generally
declining.
portfolio composition by industry
DECEMBER 31, 1997
[GRAPH]
PERFORMANCE SUMMARY
The Bulwark Fund ended the 1997 calendar year with a total return of
(22.27%). There are several reasons for the Fund's disappointing performance
during the period.
The Fund was positioned, through ownership of put options, to take advantage of
a decline in the broad market indices which did not occur. In fact, the total
return from the S&P 500 Index was 33.4%. The Fund no longer owns any put
options as this defensive mechanism requires precise timing and even when you
are right, you can still lose money. We have abandoned them.
Another position that contributed to the Fund's underperformance was gold as
prices declined sharply during the entire year. The downward pressure on the
price of gold was driven by large foreign central bank selling due to the
remarkable lack of inflation in the U.S. economy. Gold is currently selling
at a 19 year low. We feel that gold is at, or very near, a bottom. During the
fourth quarter, when the price fell off substantially, we sold our high cost
gold mining companies and added on to our low cost gold production firms. The
Fund currently has a 7% gold weighting and we are comfortable with that
percentage.
Our equity positions have been concentrated in very small illiquid stocks and
companies undergoing a restructuring. This segment of the equity market
drastically lagged the market averages over the entire year. We have made a
concerted effort to reevaluate this portion of the portfolio. During the last
quarter of 1997, the Fund eliminated 24 securities that had no promise of
recovering. The Fund currently has only 21 long positions of which 4 are
earmarked for sale under ideal circumstances.
Our short positions contributed surprisingly very little to the total
underperformance despite the strong bull market. Currently, there are 15
short positions. We are adding new positions as we feel the market is trading
on very high price-to-earnings levels. We are focused on ascertaining a
balance between a short position and long position weighting.
During the fourth quarter, the Fund experienced some changes in its
management. As a shareholder, it is fair to ask, "What is the future
direction of the Fund and who is currently overseeing it?" I am currently
managing the Bulwark Fund with the help of two analysts on our staff. The
future portfolio manager will be determined at a later date. As for the
direction of the Fund, we have made some adjustments to the portfolio's
balance, some of which have been discussed above. To review:
* The Fund is no longer using put positions.
* The Fund is currently holding a 7% portion in gold.
* The Fund has a 40% position in cash which will be deployed into long stock
ideas when found.
* The Fund will attempt to keep a strategic weighting of long ideas and short
ideas with a bias toward increasing the short positions.
We believe that, with these four main components, the Fund is better equipped
to avoid the volatility of the past and show positive results as the year
progresses. The results of the past year were a wake-up call to the future of
the Fund. We do not want to repeat it. We remain committed to recovering the
losses of the past year while providing some reliable consistency to the
future performance. We would like to thank you for staying with us over the
past year and hope you will give us the opportunity to regain your trust and
rebuild your capital. We remain confident that those goals can be achieved.
Sincerely,
/s/ Eric E. Ryback
Eric E. Ryback
President
21
<PAGE> 22
<TABLE>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER BULWARK FUND
- --------------------
COMMON STOCKS (36.56%)
Computer and Electronic Equipment (3.97%)
Gradco Systems, Inc. <F*> 102,600 $756,675
Hand Technologies, Inc. - Rule 144A <F*> 528,000 330,000
SED International Holdings, Inc. <F*> 41,000 461,250
Scientific Software Intercomp, Inc. <Fa>, <F*> 862,000 107,750
-----------------
$1,655,675
-----------------
Construction and Real Estate (0.24%)
Fiberstars, Inc. <F*> 17,500 $98,437
-----------------
Energy (14.95%)
Carbo Ceramics, Inc. 7,000 $224,000
Credo Petroleum Corporation <F*> 67,000 201,000
Harken Energy Corporation <F*> 100,000 700,000
Maynard Oil Company <F*> 110,800 1,135,700
Norex Industries, Inc. <F*> 97,700 2,002,850
Petroleum Helicopters, Inc.
Non-voting common 31,100 723,075
Voting common 56,100 1,248,225
-----------------
$6,234,850
-----------------
Investments (0.98%)
Gateway Industries, Inc. <Fa>,<F*> 234,300 $410,025
-----------------
Mining (9.18%)
Acacia Resources Ltd. <F*>, <Ff> 238,069 $217,174
Bema Gold Corporation <F*>, <Ff> 89,300 212,173
Canyon Resources Corporation <F*> 637,500 757,031
Dayton Mining Corporation <F*>, <Ff> 300,000 566,038
Plutonic Resources Ltd. <Ff> 200,000 557,764
Uranium Resources Inc. <F*> 275,000 1,065,625
Vengold, Inc. <F*>, <Ff> 500,000 454,228
-----------------
$3,830,033
-----------------
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
Telecommunications (4.24%)
Commscope, Inc. <F*> 131,600 $1,768,375
-----------------
Miscellaneous (3.00%) $1,251,954
-----------------
Total Common Stocks ($19,036,393) $15,249,349
-----------------
PREFERRED STOCKS (1.49%)
Mining (1.49%)
Westmoreland Coal Company,
8.50% convertible voting <F#>, <Fa> 119,300 $618,869
-----------------
Total Preferred Stocks ($928,141) $618,869
-----------------
NON-CONVERTIBLE BONDS (1.09%)
Mining (1.09%)
South American Gold and Copper Company,
Ltd., 10%, due 1998 - Rule 144A <Ff> CAD $1,300,000 $454,228
-----------------
Total Non-Convertible Bonds (Cost $949,252) $454,228
-----------------
CONVERTIBLE BONDS (3.13%)
Mining (3.13%)
Uranium Resources Inc., 6.5% Senior Secured, due 1998 - Rule
144A $1,500,000 $1,304,250
-----------------
Total Convertible Bonds (Cost $1,701,970) $1,304,250
-----------------
See Notes to Financial Statements
22
<PAGE> 23
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
LINDNER BULWARK FUND
- --------------------
CALL OPTIONS (0.30%) Contracts
------------------
Gold (0.30%)
July 1998 $450 200,000 $50,000
July 1999 $345 10,000 75,000
-----------------
$125,000
-----------------
Total Call Options ($545,000) $125,000
-----------------
U. S. TREASURY BILLS (41.16%)
1-8-98 to 1-22-98
(Cost $17,163,582) $17,200,000 $17,166,549
-----------------
Total Investments (Cost $40,324,338) 83.73% $34,918,245
Cash Deposits with Broker for Securities
Sold Short 16.50% $6,884,941
Receivable from Brokers for Securities
Sold Short 20.37% $8,493,979
Securities Sold Short -18.06% ($7,533,580)
Excess of Other Liabilities over Assets -2.54% ($1,059,332)
------------------ -----------------
Net Assets 100.00% $41,704,253
================== =================
<CAPTION>
Number of Shares -
Principal Amount
Name of Issuer and Title of Issue of Bonds Value
- ---------------------------------------------- ------------------ -----------------
<S> <C> <C>
SCHEDULE OF SECURITIES SOLD SHORT
Action Performance Companies, Inc. 23,000 $871,125
AES Corporation 10,500 489,562
dELiA*s Inc. 27,300 607,425
Delta & Pine Land Company 28,909 881,724
ENCAD, Inc. 19,500 536,250
In Focus Systems, Inc. 10,000 303,750
Just for Feet, Inc. 14,250 187,031
Microchip Technology, Inc. 9,900 297,000
Miller Industries, Inc. 87,600 941,700
Quintiles Transnational Corporation 10,000 382,500
SOLA International, Inc. 11,000 360,750
Splash Technologies, Inc. 24,000 540,000
STB Systems, Inc. 24,300 534,600
Ventana Medical Systems, Inc. 29,850 455,213
Zoltek Companies, Inc. 5,200 144,950
-----------------
$7,533,580
=================
<FN>
<F*> Non-income producing
<Ff> Denotes security primarily traded in foreign markets
<F#> Dividends are in arrears.
See Notes to Financial Statements
</TABLE>
23
<PAGE> 24
PERFORMANCE SUMMARY
Going into 1997, we had the greatest of expectations for the international
markets. Through the first six months, the Lindner International Fund
returned 15.4%. However, a year that started out so optimistically
unfortunately turned out to be a trememdous disappointment. This turn of
events was due mainly to the Asian economic crisis and the chaotic effect it
had on markets in other regions of the world.
While the Fund eliminated most of its exposure in Thailand, Korea and
Malaysia early in 1997, the crisis in those countries seemed to reverberate
everywhere else. The result was that the Fund was up 2.6% for the 1997
calendar year versus 1.8% for our benchmark, the Morgan Stanley EAFE Index.
During the last six months of 1997 the Fund was down 11% while the MS-EAFE
was down 8.53%.
Nevertheless, we feel the ratio of prices to intrinsic value in Russia,
Poland and some Canadian oil companies is very favorable. We will continue to
hold stocks in which we think there is a disparity between the market and
intrinsic value. We try not to dwell on the size of the company but rather on
its relation to value. This makes the Fund unique relative to other
international funds because it will have a higher proportion of emerging
market stocks in it. This year we witnessed the downside aspect of the
volatility equation. We think the selling in these markets has been very
indiscriminate and sometimes unwarranted.
If you are interested in investing internationally in low price to asset
value and growth rate, and you can tolerate the risk of fluctuating
currencies, this fund may be appropriate for you. I was so impressed with the
value of the portfolio's securities in December and January, I increased my
own personal position in the Fund.
Thank you for your patience and your continued support.
Sincerely,
/s/ Eric E. Ryback /s/ Robert A. Lange
Eric E. Ryback Robert A. Lange
President Portfolio Manager
For those with internet connections, you are familiar with the information
explosion on the World Wide Web. If you want to see how accessible
information is, look at these two web sites that represent two companies in
the portfolio: One is a telephone company in Russia and the other is a bank
in Poland.
www.uralsviazinform.ru
www.big.com.pl/ir/
Lindner International
Fund
- --------------------------
FUND PROFILE
This fund seeks capital appreciation through investments in common stocks or
convertible securities of companies whose principal business activities are
outside the United States. Income is a secondary objective.
portfolio composition by country
DECEMBER 31, 1997
[GRAPH]
24
<PAGE> 25
<TABLE>
- --------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- --------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
<CAPTION>
Number of Shares -
Country Principal Amount
Name of Issuer and Title of Issue of Origin of Bonds Value
- ---------------------------------- --------- ------------------ -------------
<S> <C> <C> <C>
LINDNER INTERNATIONAL FUND
- --------------------------
COMMON STOCKS (99.49%)
Communications (3.89%)
ECI Telecommunications Ltd. Israel 2,600 $66,300
Vimpel-Communications -
ADR <F*> Russia 2,000 71,250
-------------
$137,550
-------------
Computers and Electronic Equipment (2.07%)
SED International, Inc. (formerly
Southern Electronics) <F*> United States 6,500 $73,125
-------------
Construction and Real Estate (6.81%)
Blagovno Trgovinski Center - GDR -
Rule 144A <F*> Slovenia 12,500 $95,625
Mostostal Export Corporation
Common stock - ordinary shares Poland 32,000 80,794
Common stock - ADR Poland 20,000 50,498
Tipco Asphalt Public Company Ltd. Thailand 19,000 13,614
-------------
$240,531
-------------
Energy (17.24%)
Bitech Petroleum Corporation <F*> Canada 69,068 $180,996
Canadian Occidental Petroleum Ltd. Canada 3,500 79,188
Lukoil Oil Company - ADR Russia 200 18,500
Probe Exploration, Inc. Canada 85,000 294,025
Rao Gazprom - ADR -
Rule 144A <F*> Russia 1,500 36,195
-------------
$608,904
-------------
<CAPTION>
Number of Shares -
Country Principal Amount
Name of Issuer and Title of Issue of Origin of Bonds Value
- ---------------------------------- --------- ------------------ -------------
<S> <C> <C> <C>
Financial Services (14.03%)
Bank Inicjatyw Gospodarczych Poland 87,000 $85,151
Banque Libanaise pour le Commerce SAL
GDR - Rule 144A <F*> Lebanon 3,985 $72,328
Banque Morocaine du Commerce Exterieur
- GDR Morocco 4,700 95,175
Catalana Occidente S.A. Spain 1,333 67,868
Cie Financiere de Paribas France 800 69,550
Misr International Bank (S.A.E) - GDR
- Rule 144A <F*> Egypt 7,200 105,696
-------------
$495,768
-------------
Food and Beverage (2.38%)
Danone Group France 200 $35,739
Foster's Brewing Group, Ltd. Australia 8,000 15,221
Kirin Beverage Corporation Japan 2,000 33,225
-------------
$84,185
-------------
Foreign Telecommunications (3.57%)
AI Uralsvyazinform - ADR <F*> Russia 11,000 $126,189
-------------
Healthcare (2.45%)
Slovakofarma, A.S. - GDR <F*> Slovakia 10,000 $86,672
-------------
Industrial Products and Services (11.28%)
Bridgestone Corporation Japan 1,000 $21,766
Buderus AG Germany 100 44,828
FAG Kugelfischer Gerog Schafer AG Germany 3,800 50,195
Radiotronica, S.A. <F*> Spain 8,722 121,031
Vitro, Sociedad Anonima - ADR Mexico 12,300 160,669
-------------
$398,489
-------------
See Notes to Financial Statements
25
<PAGE> 26
<CAPTION>
- --------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- --------------------------------------------------------------------------------------------
SCHEDULES OF INVESTMENTS - DECEMBER 31, 1997
(Unaudited)
Number of Shares -
Country Principal Amount
Name of Issuer and Title of Issue of Origin of Bonds Value
- ---------------------------------- --------- ------------------ -------------
<S> <C> <C> <C>
LINDNER INTERNATIONAL FUND
- --------------------------
Investments (3.32%)
Minorco - ADR Luxembourg 7,000 $117,250
-------------
Leisure & Entertainment (2.03%)
Grupo Anaya S.A. Spain 3,100 $56,950
Matsushita Electric Industrial Co.,
Ltd. Japan 1,000 14,690
-------------
$71,640
-------------
Metals Processing (7.74%)
Impexmetal S.A. <F*> Poland 9,000 $72,002
Seversky Tube Works - ADR <F*> Russia 3,000 105,000
Zindart Limited - ADR <F*> Hong Kong 7,000 96,250
-------------
$273,252
-------------
Mining (8.35%)
Gold Reserve Corporation <F*> Canada 17,400 $63,836
IAMGOLD International African Mining
Gold Corporation <F*> Canada 24,000 75,472
Inmet Mining Corporation <F*> Canada 15,000 60,273
Meridian Gold, Inc. <F*> Canada 10,000 29,375
North Ltd. Australia 25,000 65,843
-------------
$294,799
-------------
Transportation (5.51%)
Guangshen Railway Company Ltd. China 290,000 $76,728
Transportacion Maritima Mexicana - ADR Mexico 16,000 118,000
-------------
$194,728
-------------
<CAPTION>
Number of Shares -
Country Principal Amount
Name of Issuer and Title of Issue of Origin of Bonds Value
- ---------------------------------- --------- ------------------ -------------
<S> <C> <C> <C>
Utilities (Gas, Electric & Water) (8.82%)
Canadian 88 Energy Corporation <F*> Canada 14,000 $41,579
Huaneng Power International, Inc. -
ADR <F*> China 3,500 81,156
Irkutskenergo - ADR Russia 6,500 64,054
Unified Energy Systems -
Reg S - ADR <F*> Russia 4,130 124,932
-------------
$311,721
-------------
Total Common Stocks
(Cost $3,296,974) $3,514,803
-------------
PREFERRED STOCKS (0.09%)
Mining (0.09%)
Ashanti Goldfields Company Ltd., $.648 Ghana 1,200 $3,108
-------------
Total Preferred Stocks (Cost $0) $3,108
-------------
Total Investments (Cost $3,296,974) 99.58% $3,517,911
Excess of Other Assets over Liabilities 0.42% $14,899
------------ -------------
Net Assets 100.00% $3,532,810
============ =============
<FN>
<F*> Non-income producing
ADR American Depository Receipts
GDR Global Depository Receipts
Reg S - Regulation S
See Notes to Financial Statements
</TABLE>
26
<PAGE> 27
THIS PAGE LEFT BLANK INTENTIONALLY
27
<PAGE> 28
<TABLE>
- -----------------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -----------------------------------------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED DECEMBER 31, 1997
(Unaudited)
<CAPTION>
LINDNER GROWTH FUND LINDNER DIVIDEND FUND
------------------- ---------------------
<S> <C> <C>
INVESTMENT INCOME
Income:
Dividends
Unaffiliated issuers (net of withholding taxes of
$32,676, $148,221, $3,374, $10,019, $0 and $2,758
respectively) $5,498,011 $39,412,157
Affiliated issuers (Non-controlled) 1,254,413 449,178
Amortization 4,736,353 2,732,833
Interest (net of withholding taxes of $13,950, $26,655, $0,
$0, $0, and $10, respectively) 1,631,971 18,475,980
------------------ ------------------
Total income 13,120,748 61,070,148
------------------ ------------------
Expenses:
Management fees (Note 3) 3,213,939 4,804,103
Registration and regulatory fees 16,706 19,980
Dividend expense - short sales -- 122,425
Professional fees 131,241 94,127
Custodian fees 118,401 83,992
Transfer agent fees (Note 3) 270,374 359,817
Shareholder communications 131,010 175,593
Organizational expense (Note 4) -- --
Other expenses 136,887 204,761
12b-1 fees - Institutional shares 1,149 2,908
Expenses reimbursed by advisor -- --
------------------ ------------------
Total expenses 4,019,707 5,867,706
Fees paid indirectly (Note 6) (24,186) (30,911)
------------------ ------------------
Net expenses 3,995,521 5,836,795
------------------ ------------------
Net investment income/(loss) 9,125,227 55,233,353
------------------ ------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS AND
FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) on investments of unaffiliated
issuers 61,726,998 (4,589,607)
Net realized (loss) on investments of affiliated issuers
(Non-controlled) (11,752,266) (11,467,837)
Net realized (loss) on securities sold short -- (1,113,366)
Net realized (loss) on option transactions -- --
Net realized gain (loss) on foreign currency transactions (5,809) 4,800
------------------ ------------------
Net realized gain (loss) on investments and foreign currency
transactions 49,968,923 (17,166,010)
------------------ ------------------
Change in unrealized appreciation (depreciation) on
investments (13,657,958) 117,390,633
Net unrealized appreciation on securities sold short -- --
Net unrealized (depreciation) on options -- --
Net unrealized (depreciation) on translation of assets and
liabilities in foreign currencies (4,359) (2,647)
------------------ ------------------
Net unrealized appreciation (depreciation) on investments and
translation of assets and liabilities in foreign currencies (13,662,317) 117,387,986
------------------ ------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $45,431,833 $155,455,329
================== ==================
</TABLE>
28 See Notes to Financial Statements
<PAGE> 29
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- ------------------------------------------------------------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED DECEMBER 31, 1997
(Unaudited)
<CAPTION>
LINDNER/RYBACK LINDNER
LINDNER UTILITY FUND SMALL-CAP FUND LINDNER BULWARK FUND INTERNATIONAL FUND
-------------------- -------------- -------------------- ------------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Income:
Dividends
Unaffilited issuers (net of withholding taxes
of $32,676, $148,221, $3,374, $10,019, $0 and
$2,758 respectively) $534,903 $185,372 -- $13,731
Affiliated issuers (Non-controlled) -- -- -- --
Amortization 32,397 133,635 $235,879 4,048
Interest (net of withholding taxes of $13,950,
$26,655, $0, $0, $0, and $10, respectively) 128,861 -- 603,472 207
---------------- ---------------- ---------------- --------------
Total income 696,161 319,007 839,351 17,986
---------------- ---------------- ---------------- --------------
Expenses:
Management fees (Note 3) 157,659 133,680 265,588 21,912
Registration and regulatory fees 20,257 19,092 18,219 19,760
Dividend expense - short sales -- -- 2,212 --
Professional fees 3,369 1,913 13,547 521
Custodian fees 3,813 1,246 442 5,637
Transfer agent fees (Note 3) 13,823 9,637 13,742 2,288
Shareholder communications 7,244 5,814
Organizational expense (Note 4) 3,310 2,983 6,423 3,669
Other expenses 7,113 3,493 13,896 2,268
12b-1 fees - Institutional shares 72 223 400 --
Expenses reimbursed by advisor -- -- -- (9,766)
---------------- ---------------- ---------------- --------------
Total expenses 216,660 178,081 334,469 46,289
Fees paid indirectly (Note 6) (708) (687) (752) (43)
---------------- ---------------- ---------------- --------------
Net expenses 215,952 177,394 333,717 46,246
---------------- ---------------- ---------------- --------------
Net investment income/(loss) 480,209 141,613 505,634 (28,260)
---------------- ---------------- ---------------- --------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) on investments of
unaffiliated issuers 1,848,105 984,650 (1,761,111) (195,867)
Net realized (loss) on investments of affiliated
issuers (Non-controlled) -- -- (575,376) --
Net realized (loss) on securities sold short -- -- (3,221,351) --
Net realized (loss) on option transactions -- -- (7,178,263) --
Net realized gain (loss) on foreign currency
transactions (248) (552) (768) (665)
---------------- ---------------- ---------------- --------------
Net realized gain (loss) on investments and
foreign currency transactions 1,847,857 984,098 (12,736,869) (196,532)
---------------- ---------------- ---------------- --------------
Change in unrealized appreciation (depreciation) on
investments 1,873,861 3,363,676 7,035,078 (263,838)
Net unrealized appreciation on securities sold short -- -- 557,455 --
Net unrealized (depreciation) on options -- -- (420,000) --
Net unrealized (depreciation) on translation of
assets and liabilities in foreign currencies -- -- (1,001) (75)
---------------- ---------------- ---------------- --------------
Net unrealized appreciation (depreciation) on
investments and translation of assets and
liabilities in foreign currencies 1,873,861 3,363,676 7,171,532 (263,913)
---------------- ---------------- ---------------- --------------
NET INCREASE (DECREASED) IN NET ASSETS RESULTING
FROM OPERATIONS $4,201,927 $4,489,387 $(5,059,703) $(488,705)
================ ================ ================ ==============
</TABLE>
See Notes to Financial Statements 29
<PAGE> 30
<TABLE>
- ------------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- ------------------------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1997
AND THE YEAR ENDED JUNE 30, 1997
(Unaudited)
<CAPTION>
LINDNER GROWTH FUND LINDNER DIVIDEND FUND
---------------------------------- ----------------------------------
December 31, June 30, December 31, June 30,
1997 1997 1997 1997
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss) $9,125,227 $19,791,890 $55,233,353 $127,128,085
Net realized gain (loss) on
investments and foreign
currency transactions 49,968,923 164,350,300 (17,166,010) 142,456,950
Net increase (decrease) in
unrealized appreciation on
investments and translation
of assets and liabilities in
foreign currencies (13,662,317) (10,309,030) 117,387,986 (87,961,498)
---------------- ---------------- ---------------- ----------------
Net Increase (Decrease) in Net
Assets $45,431,833 $173,833,160 $155,455,329 $181,623,537
---------------- ---------------- ---------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income:
Investors shares ($17,507,712) ($20,932,704) ($50,233,629) ($131,109,911)
Institutional shares (11,745) (235) (62,376) (64,347)
From net realized gain on
investments and foreign
currency transactions:
Investors shares (181,609,829) (166,339,554) (152,583,081) (62,624,754)
Institutional shares (131,660) (1,972) (206,827) (10,487)
---------------- ---------------- ---------------- ----------------
Net decrease in net assets from
distributions to shareholders ($199,260,946) ($187,274,465) ($203,085,913) ($193,809,499)
---------------- ---------------- ---------------- ----------------
FUND SHARE TRANSACTIONS (NOTE 7:)
Investors shares $29,646,522 $62,327,472 ($169,672,139) ($263,821,666)
Institutional shares 1,036,420 95,895 527,579 1,979,699
---------------- ---------------- ---------------- ----------------
Net Increase (Decrease) in Fund
Share Transactions 30,682,942 62,423,367 (169,144,560) (261,841,967)
---------------- ---------------- ---------------- ----------------
TOTAL INCREASE (DECREASE) IN NET
ASSETS ($123,146,171) $48,982,062 ($216,775,144) ($274,027,929)
Net Assets at the Beginning of the
Period $1,495,076,391 $1,466,094,329 $2,018,905,533 $2,292,933,462
---------------- ---------------- ---------------- ----------------
Net Assets at the End of the Period $1,371,930,220 $1,495,076,391 $1,802,130,389 $2,018,905,533
================ ================ ================ ================
Undistributed Net Investment Income
(Loss) Included in Net Assets at
the End of the Period $1,316,094 $9,710,325 $3,131,718 ($1,805,630)
================ ================ ================ ================
</TABLE>
30 See Notes to Financial Statements
<PAGE> 31
<TABLE>
- ---------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- ---------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1997
AND THE YEAR ENDED JUNE 30, 1997
(Unaudited)
<CAPTION>
LINDNER/RYBACK
LINDNER UTILITY FUND SMALL-CAP FUND
-------------------------- --------------------------
December 31, June 30, December 31, June 30,
1997 1997 1997 1997
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss) $480,209 $1,086,682 $141,613 $72,833
Net realized gain (loss) on
investments and foreign
currency transactions 1,847,857 2,371,071 984,098 1,324,888
Net increase (decrease) in
unrealized appreciation on
investments and translation
of assets and liabilities in
foreign currencies 1,873,861 1,512,781 3,363,676 2,624,124
------------ ------------ ------------ ------------
Net Increase (Decrease) in Net
Assets $4,201,927 $4,970,534 $4,489,387 $4,021,845
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income:
Investors shares ($474,365) ($1,156,654) ($204,098) ($26,731)
Institutional shares (317) (2,247) (910) --
From net realized gain on
investments and foreign
currency transactions:
Investors shares (2,523,984) (36,612) ($1,478,469) --
Institutional shares (439) (346) ($8,066) --
------------ ------------ ------------ ------------
Net decrease in net assets from
distributions to shareholders ($2,999,105) ($1,195,759) ($1,691,543) (26,731)
------------ ------------ ------------ ------------
FUND SHARE TRANSACTIONS (NOTE 7:)
Investors shares ($848,101) $10,645,924 $16,782,505 $10,705,810
Institutional shares (48,042) 44,337 219,008 150
------------ ------------ ------------ ------------
Net Increase (Decrease) in Fund
Share Transactions (896,143) 10,690,261 17,001,513 10,705,960
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE) IN NET
ASSETS $306,679 $14,465,036 $19,799,357 $14,701,074
Net Assets at the Beginning of the
Period $46,763,916 $32,298,880 $24,810,363 $10,109,289
------------ ------------ ------------ ------------
Net Assets at the End of the Period $47,070,595 $46,763,916 $44,609,720 $24,810,363
============ ============ ============ ============
Undistributed Net Investment Income
(Loss) Included in Net Assets at
the End of the Period $37,144 $31,617 ($57,960) $5,434
============ ============ ============ ============
<CAPTION>
LINDNER BULWARK FUND LINDNER INTERNATIONAL FUND
-------------------------- --------------------------
December 31, June 30, December 31, June 30,
1997 1997 1997 1997
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss) $505,634 $3,056,218 ($28,260) ($3,525)
Net realized gain (loss) on
investments and foreign
currency transactions (12,736,869) (366,095) (196,532) 84,657
Net increase (decrease) in
unrealized appreciation on
investments and translation
of assets and liabilities in
foreign currencies 7,171,532 (20,902,706) (263,913) 391,577
------------- ------------- ------------ ------------
Net Increase (Decrease) in Net
Assets ($5,059,703) ($18,212,583) ($488,705) $472,709
------------- ------------- ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income:
Investors shares ($2,703,161) ($1,311,535) -- ($281)
Institutional shares -- (28,351) -- --
From net realized gain on
investments and foreign
currency transactions:
Investors shares -- -- (81,079) (27,129)
Institutional shares -- -- (8) (2)
------------- ------------- ------------ ------------
Net decrease in net assets from
distributions to shareholders ($2,703,161) ($1,339,886) (81,087) ($27,412)
------------- ------------- ------------ ------------
FUND SHARE TRANSACTIONS (NOTE 7:)
Investors shares ($19,144,869) $25,436,861 ($608,182) $3,063,117
Institutional shares (1,468,359) 1,938,107 7 383
------------- ------------- ------------ ------------
Net Increase (Decrease) in Fund
Shares Transactions (20,613,228) 27,374,968 (608,175) 3,063,500
------------- ------------- ------------ ------------
TOTAL INCREASE (DECREASE) IN NET
ASSETS ($28,376,092) $7,822,499 ($1,177,967) $3,508,797
Net Assets at the Beginning of the
Period $70,080,345 $62,257,846 $4,710,777 $1,201,980
------------- ------------- ------------ ------------
Net Assets at the End of the Period $41,704,253 $70,080,345 $3,532,810 $4,710,777
============= ============= ============ ============
Undistributed Net Investment Income
(Loss) Included in Net Assets at
the End of the Period $27,163 $2,224,739 ($31,740) ($3,480)
============= ============= ============ ============
</TABLE>
See Notes to Financial Statements 31
<PAGE> 32
- -------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. Organization and Significant Accounting Policies
Lindner Investments, a Massachusetts business trust (the "Funds"), is
registered under the Investment Company Act of 1940, as amended, as an
open-end management investment company. Six series of shares are currently
issued: (1) Lindner Growth Fund, (2) Lindner Dividend Fund, (3) Lindner
Utility Fund, (4) Lindner/Ryback Small-Cap Fund, (5) Lindner Bulwark Fund,
and (6) Lindner International Fund. The Funds offer both Investor and
Institutional classes of shares. Investor shares are sold without a 12b-1
fee. Institutional shares are sold with a 12b-1 fee. Institutional shares
sold have their own distribution/administrative service plan and certain
expenses are directly allocated to that class.
The following is a summary of significant accounting policies followed by
the Funds.
Security Valuation
Investments in securities traded on a national securities exchange or
in the NASDAQ Stock Market are valued at the last reported sales price
as of the close of the New York Stock Exchange; securities traded in
the over-the-counter market and listed securities for which no sale was
reported on the day are valued at the mean between the last reported
bid and asked prices. The value of foreign securities is converted into
U.S. dollars at the rate of exchange prevailing on the valuation date.
When market quotes are not readily available, such securities are
valued at fair value as determined in good faith by the Board of
Trustees.
Foreign Currency Translation
The books and records of the Funds are maintained in U.S. dollars as
follows: (1) the foreign currency market value of investment securities
is translated at the current exchange rates; and (2) purchases, sales,
income, and expenses are translated at the rate of exchange prevailing
on the respective dates of such transactions.
Reported net realized foreign currency gains or losses arise from
currency gains or losses realized between the trade and settlement
dates on securities transactions, the difference between the amounts of
dividends, interest, and foreign withholding taxes recorded on the
Funds' books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign currency gains or losses arise
from changes in the value of assets and liabilities other than
investments in securities, resulting from changes in the exchange rate.
Income Taxes
It is the Funds' policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to its shareholders. Therefore, no
federal income tax provision is required.
Short Sales
The Lindner Bulwark series may invest in short sales of securities in
order to profit from declines in stock prices. When a Fund engages in a
short sale, an amount equal to the proceeds received by the Fund is
reflected as an asset and equivalent liability. The amount of the
liability is subsequently marked to market to reflect the market value
of the short sale. The Fund maintains a segregated account of
securities and cash as collateral for the short sales. The Fund is
exposed to market risk based on the amount, if any, that the market
value of the stock exceeds the proceeds received. Other Funds may
engage in short sales of securities if they own or have the right to
acquire, without the payment of further consideration, an approximately
equal amount of such securities ("short sales against the box").
32
<PAGE> 33
- -------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies (continued)
Use of Management Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires that management make certain
estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements. The reported amounts of revenues
and expenses during the reporting period may also be affected by the
estimates and assumptions management is required to make. Actual
results may differ from those estimates.
Allocation of Income, Expenses and Gains and Losses
The Funds allocate income, expenses (other than class specific
expenses) and gains and losses daily to each class of shares based upon
the relative proportion of shares represented by each class. Operating
expenses directly attributable to a specific class are charged against
the operation of that class.
Other
The Funds follow industry practice and record security transactions on
the trade date. Dividend income is recognized on the ex-dividend date,
except that certain dividends from foreign securities are recorded as
soon as the Funds are informed of the ex-dividend date. Interest income
is recognized on an accrual basis. Dividend and interest income is
recorded net of foreign taxes where recovery of such taxes is not
assured. Premiums and discounts, if any, on securities purchases are
amortized over the life of the respective securities. Distributions to
shareholders are recorded on the ex-dividend date.
2. Investment Transactions
For the six months ended December 31, 1997, aggregate purchases and sales
of investment securities, other than options, securities sold short, and
short-term obligations were as follows:
<TABLE>
<CAPTION>
Purchases Sales
--------- -----
<S> <C> <C>
LINDNER GROWTH FUND $252,393,092 $411,999,499
LINDNER DIVIDEND FUND 584,656,268 754,651,475
LINDNER UTILITY FUND 16,216,616 20,287,745
LINDNER/RYBACK
SMALL-CAP FUND 16,264,451 2,590,367
LINDNER BULWARK FUND 4,784,339 19,009,156
LINDNER INTERNATIONAL FUND 867,611 1,292,803
</TABLE>
For the six months ended December 31, 1997, aggregate purchases and sales
of U.S. Government securities were as follows:
<TABLE>
<CAPTION>
Purchases Sales
--------- -----
<S> <C> <C>
LINDNER GROWTH FUND $642,148,128 $647,305,364
LINDNER DIVIDEND FUND 339,423,216 493,305,518
LINDNER UTILITY FUND 16,625,413 14,557,210
LINDNER/RYBACK
SMALL-CAP FUND 41,039,168 39,076,904
LINDNER BULWARK FUND 127,380,232 124,857,639
LINDNER INTERNATIONAL FUND 2,591,550 2,795,279
</TABLE>
33
<PAGE> 34
- -------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -------------------------------------------------------------------------------
2. Investment Transactions (continued)
For the six months ended December 31, 1997, aggregate purchases and sales
of options in the Lindner Bulwark Fund were $7,287,952 and $7,012,288,
respectively.
For the six months ended December 31, 1997, the cost of investments
purchased to cover short sales and the proceeds from investments sold short
were as follows:
<TABLE>
<CAPTION>
Short Sales Covers
----------- ------
<S> <C> <C>
LINDNER DIVIDEND FUND $ 5,531,873 $ 5,922,161
LINDNER BULWARK FUND 13,293,378 22,345,243
</TABLE>
On December 31, 1997, the composition of unrealized appreciation and
(depreciation) of investment securities based on the aggregate cost of
investments for federal income tax purposes was as follows:
<TABLE>
<CAPTION>
Appreciation (Depreciation) Net Federal Tax Cost
------------ -------------- --- ----------------
<S> <C> <C> <C> <C>
LINDNER GROWTH FUND $396,553,793 $(85,458,255) $311,095,538 $1,052,455,271
LINDNER DIVIDEND FUND 221,502,321 (60,907,450) 160,594,871 1,613,949,364
LINDNER UTILITY FUND 8,925,793 (1,451,913) 7,473,880 39,459,413
LINDNER/RYBACK
SMALL-CAP FUND 8,802,087 (1,069,661) 7,732,426 36,946,580
LINDNER BULWARK FUND 3,141,965 (7,990,603) (4,848,638) 40,324,338
LINDNER INTERNATIONAL FUND 646,824 (425,888) 220,936 3,296,974
</TABLE>
3. Fees and Other Transactions with Affiliates
The management fee for Lindner Growth Fund series is payable to Ryback
Management (the "Adviser") (before reimbursement of expenses to the
Funds, if any) at the annual rate of .7% of average net assets up to $50
million, .6% of the next $350 million and .5% of the excess over $400
million. Depending on Lindner Growth Fund's performance compared to the S&P
500 Composite Index, the fee may be increased or decreased by up to .2%.
For the six months ended December 31, 1997, the Lindner Growth Fund under
performed the S&P. Accordingly, the basic Advisor's fee of $3,959,430 was
reduced by a performance penalty of .1% of average net assets, or $745,491.
This resulted in a net Advisor's fee of $3,213,939.
The management fee for Lindner Dividend Fund series is payable quarterly to
the Adviser (before reimbursement of expenses to the Funds, if any) at the
annual rate of .7% of average net assets up to $50 million, .6% of the next
$150 million and .5% of the excess over $200 million.
The management fee is payable monthly to the Adviser by Lindner Utility
Fund and Lindner/Ryback Small-Cap Fund according to the following annual
percentage rate of daily net asset values averaged monthly (before
reimbursement of expenses to the Funds, if any) of each of the Funds: .7%
on the first $50,000,000, .6% on the next $150,000,000 and .5% of the
excess of $200,000,000.
The management fee from Lindner Bulwark Fund and Lindner International Fund
is payable monthly to the Adviser at the annual percentage rate of 1% of
daily net asset values averaged monthly (before reimbursement of expenses
to the Funds, if any) of each of the Funds.
Annual operating and management expenses for the Lindner Growth Fund and
Lindner Dividend Fund, excluding taxes and interest, may not exceed 1.5% of
the first $30 million of average net assets plus 1% of average net assets
in excess of $30 million of the respective funds.
34
<PAGE> 35
- -------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -------------------------------------------------------------------------------
3. Fees and Other Transactions with Affiliates (continued)
Ryback Management Corporation, acting as stock transfer agent and dividend
disbursing agent for the Funds, is compensated at a rate of 75 cents per
shareholder account per month. During the six months ended December 31,
1997, the following transfer agent fees were paid to Ryback Management
Corporation: Lindner Growth Fund ($232,261), Lindner Dividend Fund
($314,807), Lindner Utility Fund ($11,479), Lindner/Ryback Small-Cap Fund
($8,132), Lindner Bulwark Fund ($11,508), and Lindner International Fund
($1,905).
Certain officers and directors of the Funds are affiliates of Ryback
Management Corporation.
4. Organizational Expense
The following is a schedule of expenses in connection with the organization
and registration of the Funds which are being amortized and reimbursed to
the Adviser on a straight line basis over a period of five years:
<TABLE>
<CAPTION>
Original Accumulated 1997
Expense Amortization Expense
-------- ------------ -------
<S> <C> <C> <C>
LINDNER UTILITY FUND $32,377 $27,867 $3,310
LINDNER/RYBACK
SMALL-CAP FUND 29,182 23,294 2,983
LINDNER BULWARK FUND 62,831 49,503 6,423
LINDNER INTERNATIONAL FUND 35,889 21,854 3,669
</TABLE>
Any redemption by the shareholders of the Adviser of their initial
investment in Lindner Utility Fund of $100,000 will reduce the
reimbursement by a pro rata portion of any of the then unamortized
expenses.
5. Transactions with Affiliates
Issuers of whose voting stock the Funds own more than 5% but less than 25%
are classified as "affiliates (Non-controlled"). Following is an analysis
of transactions for the six months ended December 31, 1997, with
"affiliated companies" as defined by the Investment Company Act of 1940:
<TABLE>
<CAPTION>
Gain(Loss)
Realized
Dividend on Sale
Security Name Activity Income of Shares
- ------------------------------ --------------------------------------------------------------- ---------- ------------
Value at Purchases, Sales, Value
Beginning Additions Reductions at End of
of Period at Cost at Cost Period
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
LINDNER GROWTH FUND
7th Level, Inc. $ 2,800,746 $ 2,426,795 $ 0 $ 467,073
AlarmGuard Holdings 3,371,049 2,454,688 0 802,833
Alliant Techsystems, Inc. 47,575,000 545,882 46,696,200 1,003,735
Allied Healthcare Products,
Inc. 4,258,800 5,077,800
American Classic Voyages
Company <F#> $ 928,313 12,799,875
American Media, Inc., Class A 18,248,300 2,647,935 16,413,725 1,025,726
Anvil Range Mining 1,970,968 5,045,570 0 (3,250,411)
Autoinfo, Inc. 1,123,688 1,044,605 <F##> (509,635)
Bitech Petroleum Corporation -
Rule 144A 3,986,952 416,130 <F##>
BFX Hospitality Group, Inc.
(formerly Buffton
Corporation) 1,127,250 1,373,817 0 (221,517)
Canyon Resources Corporation 5,807,100 241,337 2,953,788
35
<PAGE> 36
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- ---------------------------------------------------------------------------------------------------------------------------------
Gain(Loss)
Realized
Dividend on Sale
Security Name Activity Income of Shares
- ------------------------------ --------------------------------------------------------------- ---------- ------------
Value at Purchases, Sales, Value
Beginning Additions Reductions at End of
of Period at Cost at Cost Period
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
LINDNER GROWTH FUND
(CONTINUED)
Cardiometrics, Inc. <F^^> $ 4,742,419 $ 2,887,268 $ 0
Charming Shoppes, Inc. 43,446,721 $ 315,313 751,563 38,450,156 $ 161,845
CML Group, Inc. 5,113,606 5,909,712 <F##> 401,889
The Coast Distribution Company 1,690,875 1,565,625
Comprehensive Care Corporation
- Rule 144A 3,031,250 1,671,875
CPI Corporation 20,099,100 2,835,621 2,600,001 21,649,863 $ 224,000 716,908
Dayton Mining Corporation 9,086,075 4,926,981
Designs, Inc. <F#> 4,735,001 3,600,000
Eagle Point Software
Corporation 1,140,625 937,500 0 (75,029)
EMCON 1,803,425 1,671,318 0 55,124
Eskimo Pie Corporation 2,970,625 2,817,500 24,500
Fiberstars, Inc. 1,638,488 1,890,563
Gainsco, Inc. <F++> 10,549,625 10,388,700 28,533
Gateway Industries, Inc. 661,968 570,325
General Magic, Inc. 3,252,800 2,059,120 0 560,224
The Good Guys, Inc. 6,737,625 9,133,225
Gradco Systems, Inc. 3,618,250 472,500 5,723,000
Handleman Company 20,503,275 23,278,161 0 (1,895,063)
Hilb, Rogal and Hamilton
Company 17,000,000 19,312,500 310,000
Hyseq, Inc. - Rule 144A <F#> 1,642,800 5,788,800
International Bancshares
Corporation 25,515,765 <F##>
London & Overseas Freighters
Ltd. - ADR 5,702,344 6,183,875
Maynard Oil Company - ADR 7,925,125 4,998,925
Metricom, Inc. 8,580,750 22,521,243 0 (13,099,243)
Micronics Computers, Inc. 4,011,569 7,721,946 0 (5,072,476)
MFRI, Inc. 3,239,500 2,898,500
MK Gold Company 2,826,875 2,447,759 0 (764,195)
The Morningstar Group, Inc. <F^^> 26,878,125 9,818,882 0 8,117,460
Noodle Kidoodle, Inc. 2,302,125 3,035,841 0 (1,155,679)
OMI, Inc. 23,189,063 961,594 1,968,875 19,982,813 2,370,127
Quixote Corporation 5,636,000 5,636,000 91,585
Ramco-Gershenson Properties
Trust 9,574,341 681,910 9,843,750 420,000 101,880
Recycling Industries, Inc. 1,937,500 240,950 6,252,000
Rightchoice Managed Care, Inc, 3,515,400 2,076,965 <F##>
Rose's Stores, Inc. 1,139,506 1,680,287 0 (925,560)
SED International Holdings,
Inc. <F#> 11,233,760 11,334,375
Scientific Software-Intercomp,
Inc. 412,212 108,500
South American Gold and Copper
Company Ltd. 447,626 990,468 0 (835,685)
Spaghetti Warehouse, Inc. 3,377,400 2,720,186 0 379,743
Summit Medical Systems, Inc. 1,553,200 1,673,588 0 (112,340)
Superior Surgical Mfg.
Company, Inc. 5,792,750 46,200 7,952,000 116,795
Tanknology Environmental, Inc. 2,566,680 2,256,980
Transtechnology Corporation 6,825,000 8,493,750 39,000
36
<PAGE> 37
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- ---------------------------------------------------------------------------------------------------------------------------------
Gain(Loss)
Realized
Dividend on Sale
Security Name Activity Income of Shares
- ------------------------------ --------------------------------------------------------------- ---------- ------------
Value at Purchases, Sales, Value
Beginning Additions Reductions at End of
of Period at Cost at Cost Period
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
LINDNER GROWTH FUND
(CONTINUED)
Uni-Marts, Inc. $ 2,935,500 $ 47,902 $ 2,089,500
United Retail Group, Inc. 2,591,500 4,211,188
Uranium Resources, Inc. 5,026,209 3,315,159
Vertex Communications
Corporation 11,235,000 10,132,500
Wave Technologies
International, Inc. 1,627,500 238,125 1,935,938
Westmoreland Coal Company 8.5%
Convertible Preferred
(Voting) 733,950 108,499 828,444
------------ ------------ ------------ ------------ ---------- ------------
$413,905,495 $ 37,090,635 $110,894,920 $319,884,696 $1,254,413 $(11,752,266)
============ ============ ============ ============ ========== ============
LINDNER DIVIDEND FUND
American Bank of Connecticut $ 4,395,155 $ 5,954,481 $ 105,178
Bitech Petroleum Corporation 5,304,430 $ 84,010 7,067,335
El Paso Electric Company 26,837,500 $ 603,860 27,061,369 $ (4,956)
Handleman Company 18,483,038 19,021,462 0 (3,697,706)
Hanover Capital Mortgage -
Units <F++> 6,356,654 6,600,000 64,000
Harken Energy Corporation 45,500,000 2,941,751 49,000,000
Metricom, Inc. 7,143,188 15,834,140 0 (7,990,640)
Redwood Trust, Inc. <F++> 20,902,162 16,300,000 280,000
Spaghetti Warehouse, Inc. 2,879,400 2,399,500 0 225,465
Uranium Resources, Inc.
Common stock 1,991,625 1,313,625
Common stock - Rule 144A 2,937,500 1,937,500
------------ ------------ ------------ ------------ ---------- ------------
$115,471,836 $ 30,284,577 $ 37,858,962 $115,234,310 $ 449,178 $(11,467,837)
============ ============ ============ ============ ========== ============
LINDNER BULWARK FUND
BFX Hospitality Group, Inc.
(formerly Buffton
Corporation) $ 1,064,250 $ 1,194,635 $ 0 $ (106,735)
Gateway Industries, Inc. 475,910 410,025
Rose's Stores, Inc. 1,148,870 1,511,712 0 (468,641)
Scientific Software Intercomp,
Inc. 409,364 107,750
Westmoreland Coal Company 8.5%
Convertible Preferred
(Voting) 626,325 618,869
------------ ------------ ------------ ------------ ---------- ------------
$ 3,724,719 $ 0 $ 2,706,347 $ 1,136,644 $ 0 $ (575,376)
============ ============ ============ ============ ========== ============
<FN>
<F#> - At June 30, 1997, was not affiliated.
<F++> - At June 30, 1997, was not owned.
<F##> - At December 31, 1997, was not affiliated.
<F^^> - Investment merged into another security resulting in no gain or loss. Any
gain or loss disclosed is a result of sales prior to merger.
</TABLE>
37
<PAGE> 38
- -------------------------------------------------------------------------------
LINDNER INVESTMENTS
- -------------------------------------------------------------------------------
6. Expense Offset Arrangements
The Funds have an arrangement whereby custodian expenses are reduced by
maintaining a compensating balance with the custodian. The Funds could have
invested the assets used by the custodian in an income-producing asset if
it had not agreed to a reduction in fees under the expense offset
arrangement. In the Statements of Operations and expense ratio in the
Financial Highlights, total expenses include the expense which had been
offset. The following are the aggregate amounts for the six months ended
December 31, 1997, by which expenses have been increased for financial
statement presentation:
<TABLE>
<S> <C>
LINDNER GROWTH FUND $24,186
LINDNER DIVIDEND FUND 30,911
LINDNER UTILITY FUND 708
LINDNER/RYBACK
SMALL-CAP FUND 687
LINDNER BULWARK FUND 752
LINDNER INTERNATIONAL FUND 43
</TABLE>
7. Capital Stock
The Funds have authorized unlimited shares of $.01 par value Investor
shares and Institutional shares. Transactions in shares of capital stock
for the six months ended December 31, 1997, were as follows:
<TABLE>
<CAPTION>
Six Months Ended
December 31, 1997 Year Ended June 30, 1997
-------------------------- ---------------------------
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
LINDNER GROWTH FUND
Investor shares
- ---------------
Sold 1,569,872 $ 44,543,672 4,034,285 $ 104,275,859
Dividends and Distributions reinvested 8,184,341 183,247,393 7,123,614 174,101,137
Redeemed (7,307,851) (198,144,543) (8,411,952) (216,049,524)
----------- ------------- ----------- -------------
Net increase 2,446,362 $ 29,646,522 2,745,947 $ 62,327,472
=========== ============= =========== =============
Institutional shares
- --------------------
Sold 36,397 $ 961,373 3,917 $ 95,942
Dividends and Distributions reinvested 6,416 143,404 1 13
Redeemed (2,547) (68,357) (2) (60)
----------- ------------- ----------- -------------
Net increase 40,266 $ 1,036,420 3,916 $ 95,895
=========== ============= =========== =============
LINDNER DIVIDEND FUND
Investor shares
- ---------------
Sold 2,680,538 $ 76,794,357 11,601,117 $ 321,785,067
Dividends and Distributions reinvested 6,477,740 172,580,937 5,881,248 161,114,417
Redeemed (14,674,931) (419,047,433) (26,976,613) (746,721,150)
----------- ------------- ----------- -------------
Net increase (5,516,653) $(169,672,139) (9,494,248) $(263,821,666)
=========== ============= =========== =============
Institutional shares
- --------------------
Sold 14,999 $ 430,065 82,348 $ 2,267,410
Dividends and Distributions reinvested 10,075 267,772 2,723 74,615
Redeemed (6,037) (170,258) (13,041) (362,326)
----------- ------------- ----------- -------------
Net increase 19,037 $ 527,579 72,030 $ 1,979,699
=========== ============= =========== =============
38
<PAGE> 39
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
LINDNER INVESTMENTS
- ---------------------------------------------------------------------------------------------------------------------------
Six Months Ended
December 31, 1997 Year Ended June 30, 1997
-------------------------- ---------------------------
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
LINDNER UTILITY FUND
Investor shares
- ---------------
Sold 381,105 $ 6,219,379 2,353,165 $ 34,422,373
Dividends and Distributions reinvested 176,533 2,719,834 72,998 1,059,599
Redeemed (609,706) (9,787,314) (1,734,066) (24,836,048)
----------- ------------- ----------- -------------
Net increase (52,068) $ (848,101) 692,097 $ 10,645,924
=========== ============= =========== =============
Institutional shares
- --------------------
Sold 457 $ 7,118 19,057 $ 268,131
Dividends and Distributions reinvested 48 753 173 2,492
Redeemed (3,424) (55,913) (15,812) (226,286)
----------- ------------- ----------- -------------
Net increase (2,919) $ (48,042) 3,418 $ 44,337
=========== ============= =========== =============
LINDNER/RYBACK SMALL-CAP FUND
Investor shares
- ---------------
Sold 2,831,875 $ 24,125,763 2,182,401 $ 14,716,844
Dividends and Distributions reinvested 194,681 1,600,280 3,864 25,192
Redeemed (1,041,482) (8,943,538) (597,054) (4,036,226)
----------- ------------- ----------- -------------
Net increase 1,985,074 $ 16,782,505 1,589,211 $ 10,705,810
=========== ============= =========== =============
Institutional shares
- --------------------
Sold 28,892 $ 235,131 24 $ 150
Dividends and Distributions reinvested 1,094 8,973 0 0
Redeemed (2,948) (25,096) 0 0
----------- ------------- ----------- -------------
Net increase 27,038 $ 219,008 24 $ 150
=========== ============= =========== =============
LINDNER BULWARK FUND
Investor shares
- ---------------
Sold 4,493,306 $ 28,875,576 11,966,627 $ 100,089,008
Dividends and Distributions reinvested 433,245 2,517,155 154,353 1,236,353
Redeemed (7,978,923) (50,537,600) (9,346,728) (75,888,500)
----------- ------------- ----------- -------------
Net increase (3,052,372) $ (19,144,869) 2,774,252 $ 25,436,861
=========== ============= =========== =============
Institutional shares
- --------------------
Sold 19,355 $ 120,000 286,659 $ 2,316,545
Dividends and Distributions reinvested 0 0 3,547 28,338
Redeemed (254,614) (1,588,359) (54,929) (406,776)
----------- ------------- ----------- -------------
Net increase (235,259) $ (1,468,359) 235,277 $ 1,938,107
=========== ============= =========== =============
LINDNER INTERNATIONAL FUND
Investor shares
- ---------------
Sold 194,771 $ 2,200,376 508,905 $ 5,215,761
Dividends and Distributions reinvested 8,418 79,130 2,851 27,282
Redeemed (260,899) (2,887,688) (212,319) (2,179,926)
----------- ------------- ----------- -------------
Net increase (57,710) $ (608,182) 299,437 $ 3,063,117
=========== ============= =========== =============
Institutional shares
- --------------------
Sold 0 $ 0 38 $ 382
Dividends and Distributions reinvested 0 7 0 1
Redeemed 0 0 0 0
----------- ------------- ----------- -------------
Net increase 0 $ 7 38 $ 383
=========== ============= =========== =============
</TABLE>
39
<PAGE> 40
<TABLE>
FINANCIAL HIGHLIGHTS
(FOR AN INVESTOR SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<CAPTION>
INCOME (LOSS) FROM INVESTMENT OPERATIONS DISTRIBUTIONS
------------------------------------------------------- ----------------------------------------------
Net Realized Distributions
and from Net
Net Asset Unrealized Total Dividends Realized
Value, Net Gains from from Net Gains from
Beginning Investment (Losses) on Investment Investment Investment Total
of Period Income Investments Operations Income Transactions Distributions
--------- ---------- ------------ ---------- ---------- ------------- -------------
LINDNER GROWTH FUND <F1>
------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1988 $19.15 $0.66 $0.52 $1.18 $0.98 $1.61 $2.59
1989 $17.74 $0.85 $1.94 $2.79 $0.69 $0.18 $0.87
1990 $19.66 $0.85 $0.66 $1.51 $0.91 $0.84 $1.75
1991 $19.42 $0.75 ($0.88) ($0.13) $0.86 $0.71 $1.57
1992 $17.72 $0.57 $2.47 $3.04 $0.66 $0.00 $0.66
1993 <F8> $20.10 $0.50 $2.40 $2.90 $0.53 $0.15 $0.68
1994 $22.32 $0.38 $0.71 $1.09 $0.46 $0.53 $0.99
1995 $22.42 $0.43 $2.66 $3.09 $0.34 $1.84 $2.18
1996 $23.33 $0.40 $4.47 $4.87 $0.47 $1.34 $1.81
1997 $26.39 $0.36 $2.72 $3.08 $0.39 $3.10 $3.49
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $25.98 $0.38 $0.31 $0.69 $0.34 $3.48 $3.82
<CAPTION>
LINDNER DIVIDEND FUND <F2>
--------------------------
Period Ended February 28,
<S> <C> <C> <C> <C> <C> <C> <C>
1988 $24.49 $1.68 ($1.95) ($0.27) $1.87 $1.16 $3.03
1989 $21.19 $1.71 $1.65 $3.36 $1.32 $0.06 $1.38
1990 $23.17 $2.02 ($0.30) $1.72 $2.19 $0.01 $2.20
1991 $22.69 $1.92 ($1.17) $0.75 $1.86 $0.02 $1.88
1992 $21.56 $2.15 $2.55 $4.70 $1.99 $0.00 $1.99
1993 <F8> $24.27 $1.72 $2.98 $4.70 $1.86 $0.10 $1.96
1994 $27.01 $1.88 $1.06 $2.94 $1.74 $0.58 $2.32
1995 $27.63 $1.93 ($2.13) ($0.20) $1.90 $0.57 $2.47
<CAPTION>
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1995 $24.96 $0.95 $1.05 $2.00 $0.96 $0.00 $0.96
1996 $26.00 $1.80 $2.29 $4.09 $1.79 $0.23 $2.02
1997 $28.07 $1.63 $0.70 $2.33 $1.68 $0.78 $2.46
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $27.94 $0.87 $1.46 $2.33 $0.80 $2.48 $3.28
<CAPTION>
LINDNER UTILITY FUND <F3>
-------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1994 $10.00 $0.05 ($0.01) $0.04 $0.02 $0.00 $0.02
1995 $10.02 $0.39 $0.84 $1.23 $0.39 $0.09 $0.48
1996 $10.77 $0.35 $3.42 $3.77 $0.34 $0.00 $0.34
1997 $14.20 $0.39 $1.60 $1.99 $0.42 $0.02 $0.44
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $15.75 $0.18 $1.33 $1.51 $0.18 $0.93 $1.11
<CAPTION>
RATIOS/SUPPLEMENTAL DATA
------------------------------------------------------------------------------------
Ratio of Net
Investment Net
Net Asset Ratio of Income Assets,
Value, Expenses to Portfolio Average End of
End of Total to Average Average Turnover Commission Period
Period Return <F7> Net Assets Net Assets Rate Rates (In Millions)
--------- ----------- ---------- ----------- --------- ---------- -------------
LINDNER GROWTH FUND <F1>
------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1988 $17.74 7.49% 1.07% 3.76% 20.93% $404
1989 $19.66 16.51% 0.92% 4.93% 17.81% $535
1990 $19.42 7.89% 0.74% 4.84% 19.24% $716
1991 $17.72 -0.23% 0.83% 4.64% 12.96% $783
1992 $20.10 17.58% 0.80% 3.05% 11.37% $978
1993 <F8> $22.32 14.87% 0.80% 2.52% 18.71% $1,278
1994 $22.42 4.83% 0.65% 1.69% 37.92% $1,528
1995 $23.33 14.89% 0.54% 1.89% 24.94% $1,446
1996 $26.39 21.95% 0.63% <F9> 1.53% 39.49% $0.0397 $1,446
1997 $25.98 12.50% 0.44% 1.39% 36.39% $0.0437 $1,495
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $22.85 2.92% 0.27% 0.64% 19.40% $0.0306 $1,371
<CAPTION>
LINDNER DIVIDEND FUND <F2>
--------------------------
Period Ended February 28,
<S> <C> <C> <C> <C> <C> <C> <C>
1988 $21.19 -0.51% 1.04% 7.43% 16.52% $52
1989 $23.17 16.21% 0.97% 7.57% 2.30% $97
1990 $22.69 7.48% 0.87% 8.90% 5.47% $142
1991 $21.56 3.84% 0.87% 8.98% 3.36% $163
1992 $24.27 22.91% 0.80% 9.75% 24.01% $266
1993 <F8> $27.01 20.28% 0.74% 7.10% 13.50% $1,016
1994 $27.63 11.19% 0.64% 7.01% 43.20% $1,532
1995 $24.96 -0.44% 0.61% 7.76% 29.79% $1,697
<CAPTION>
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1995 $26.00 8.12% 0.21% 2.43% 11.00% $1,903
1996 $28.07 16.14% 0.60% <F9> 6.62% 30.24% $0.0508 $2,293
1997 $27.94 8.75% 0.60% 5.74% 40.32% $0.0443 $2,017
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $26.99 8.66% 0.31% 2.95% 34.03% $0.0476 $1,800
<CAPTION>
LINDNER UTILITY FUND <F3>
-------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1994 $10.02 0.39% 1.30% 0.76% 44.95% $11
1995 $10.77 12.51% 1.04% 3.02% 190.70% $18
1996 $14.20 35.39% 0.95% <F9> 2.87% 98.58% $0.0422 $32
1997 $15.75 14.29% 0.89% 2.81% 86.44% $0.0376 $47
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $16.15 9.95% 0.48% 1.06% 36.70% $0.0408 $47
40
<PAGE> 41
<CAPTION>
INCOME (LOSS) FROM INVESTMENT OPERATIONS DISTRIBUTIONS
------------------------------------------------------- ----------------------------------------------
Net Realized Distributions
and from Net
Net Asset Unrealized Total Dividends Realized
Value, Net Gains from from Net Gains from
Beginning Investment (Losses) on Investment Investment Investment Total
of Period Income Investments Operations Income Transactions Distributions
--------- ---------- ------------ ---------- ---------- ------------- -------------
LINDNER/RYBACK SMALL-CAP FUND <F5>
----------------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1994 $5.00 $0.01 ($0.22) ($0.21) $0.00 $0.00 $0.00
1995 $4.79 ($0.03) $0.71 $0.68 $0.01 $0.00 $0.01
1996 $5.46 $0.00 $1.30 $1.30 $0.00 $0.61 $0.61
1997 $6.15 $0.04 $1.49 $1.53 $0.01 $0.00 $0.01
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $7.67 $0.03 $1.14 $1.17 $0.04 $0.30 $0.34
<CAPTION>
LINDNER BULWARK FUND <F4>
-------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1994 $7.00 $0.01 $0.16 $0.17 $0.00 $0.00 $0.00
1995 $7.17 $0.11 ($0.10) $0.01 $0.05 $0.04 $0.09
1996 $7.09 $0.26 $1.32 $1.58 $0.31 $0.00 $0.31
1997 $8.36 $0.29 ($1.81) ($1.52) $0.14 $0.00 $0.14
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $6.70 $0.18 ($0.68) ($0.50) $0.39 $0.00 $0.39
<CAPTION>
LINDNER INTERNATIONAL FUND <F6>
-------------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1995 $9.00 $0.07 $0.02 $0.09 $0.00 $0.00 $0.00
1996 $9.09 ($0.01) $0.86 $0.85 $0.05 $0.00 $0.05
1997 $9.89 ($0.01) $1.45 $1.44 $0.00 $0.14 $0.14
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $11.19 ($0.08) ($1.17) ($1.25) $0.00 $0.22 $0.22
<CAPTION>
RATIOS/SUPPLEMENTAL DATA
------------------------------------------------------------------------------------
Ratio of Net
Investment Net
Net Asset Ratio of Income Assets,
Value, Expenses to Portfolio Average End of
End of Total to Average Average Turnover Commission Period
Period Return <F7> Net Assets Net Assets Rate Rates (In Millions)
--------- ----------- ---------- ----------- --------- ---------- -------------
LINDNER/RYBACK SMALL-CAP FUND <F5>
----------------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1994 $4.79 -4.20% 0.96% 0.52% 5.03% $5
1995 $5.46 14.32% 1.65% -0.57% 158.62% $8
1996 $6.15 25.70% 1.22% <F9> -0.04% 103.05% $0.0560 $10
1997 $7.67 24.96% 0.96% 0.46% 49.49% $0.0496 $25
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $8.50 15.38% 0.47% 0.38% 8.02% $0.0522 $44
<CAPTION>
LINDNER BULWARK FUND <F4>
-------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1994 $7.17 2.43% 0.66% 0.26% 0.89% $31
1995 $7.09 0.10% 1.27% 2.45% 122.64% $65
1996 $8.36 23.44% 1.24% <F9> 2.45% 139.82% $0.0032 $62
1997 $6.70 -18.43% 1.20% 3.86% 457.57% $0.0314 $68
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $5.81 -7.54% 0.62% 0.94% 84.24% $0.0321 $42
<CAPTION>
LINDNER INTERNATIONAL FUND <F6>
-------------------------------
Period Ended June 30,
<S> <C> <C> <C> <C> <C> <C> <C>
1995 $9.09 1.00% 1.26% 1.02% 0.00% $0.3
1996 $9.89 9.41% 2.57% <F9> 0.05% 48.40% $0.0293 $1.2
1997 $11.19 14.76% 1.96% -0.14% 37.79% $0.9954 $4.7
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $9.72 -11.07% 1.07% 0.65% 22.17% $0.7947 $3.5
<FN>
<F1> Historical performance information is for Lindner Fund, Inc. ("LGFI"),
the predecessor of the Lindner Growth Fund series of the Trust. The
Lindner Growth Fund series of the Trust succeeded to all of the assets
and liabilities of LGFI on June 30, 1995, pursuant to a reorganization
approved by the shareholders of LGFI on June 29, 1995.
<F2> Historical performance information is for Lindner Dividend Fund, Inc.
("LDFI"), the predecessor of the Lindner Dividend Fund series of the
Trust. The Lindner Dividend Fund series of the Trust succeeded to all of
the assets and liabilities of LDFI on June 30, 1995, pursuant to a
reorganization approved by the shareholders of LDFI on June 29, 1995.
<F3> Operations commenced on October 4, 1993.
<F4> Operations commenced on January 24, 1994.
<F5> Operations commenced on February 11, 1994.
<F6> Operations commenced on January 1, 1995.
<F7> Total return for periods of less than one year are not annualized. Total
return is the percentage increase in value for a period, assuming initial
investment at the net asset value on the day before the start of the
period and assuming all dividends and distributions were reinvested and a
redemption at the net asset value on the last day of the period.
<F8> On January 29, 1993, Lindner Growth Fund and Lindner Dividend Fund changed
financial advisors to Ryback Management Corporation from Lindner
Management Corporation.
<F9> Expense ratio for periods after September 1, 1995, are computed using
gross expenses which include fees reduced in connection with specific
agreements.
</TABLE>
41
<PAGE> 42
<TABLE>
(FOR AN INSTITUTIONAL SHARE OUTSTANDING THROUGHOUT THE PERIOD)
<CAPTION>
INCOME (LOSS) FROM INVESTMENT OPERATIONS DISTRIBUTIONS
------------------------------------------------------- ----------------------------------------------
Net Realized Distributions
and from Net
Net Asset Unrealized Total Dividends Realized
Value, Net Gains from from Net Gains from
Beginning Investment (Losses) on Investment Investment Investment Total
of Period Income Investments Operations Income Transactions Distributions
--------- ---------- ------------ ---------- ---------- ------------- -------------
LINDNER GROWTH FUND <F1>
------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $26.39 $0.34 $2.68 $3.02 $0.37 $3.10 $3.47
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $25.94 $0.36 $0.29 $0.65 $0.31 $3.48 $3.79
<CAPTION>
LINDNER DIVIDEND FUND <F2>
--------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $28.07 $1.61 $0.66 $2.27 $1.66 $0.78 $2.44
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $27.90 $0.85 $1.46 $2.31 $0.78 $2.49 $3.27
<CAPTION>
LINDNER UTILITY FUND <F3>
-------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $14.20 $0.27 $1.59 $1.86 $0.31 $0.02 $0.33
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $15.74 $0.10 $1.39 $1.49 $0.10 $0.93 $1.03
<CAPTION>
LINDNER/RYBACK SMALL-CAP FUND <F4>
----------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $6.15 $0.04 $1.49 $1.53 $0.01 $0.00 $0.01
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $7.67 $0.02 $1.13 $1.15 $0.03 $0.30 $0.33
<CAPTION>
LINDNER BULWARK FUND <F5>
-------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $8.36 $0.26 ($1.81) ($1.55) $0.14 $0.00 $0.14
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $6.67 ($0.21) ($0.30) ($0.51) $0.00 $0.00 $0.00
<CAPTION>
LINDNER INTERNATIONAL FUND <F6>
-------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $9.89 ($0.04) $1.45 $1.41 $0.00 $0.14 $0.14
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $11.16 ($0.08) ($1.20) ($1.28) $0.00 $0.22 $0.22
<CAPTION>
RATIOS/SUPPLEMENTAL DATA
------------------------------------------------------------------------------------
Ratio of Net
Investment Net
Net Asset Ratio of Income Assets,
Value, Expenses to Portfolio Average End of
End of Total to Average Average Turnover Commission Period
Period Return <F7> Net Assets Net Assets Rate Rates (In Millions)
--------- ----------- ---------- ----------- --------- ---------- -------------
LINDNER GROWTH FUND <F1>
------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $25.94 15.36% 0.46% 1.29% 36.39% $0.0437 $101.6
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $22.80 2.78% 0.40% 0.04% 19.40% $0.0306 $1,007
<CAPTION>
LINDNER DIVIDEND FUND <F2>
--------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $27.90 9.84% 0.85% 5.69% 40.32% $0.0443 $2,010
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $26.94 8.56% 0.44% 3.00% 34.03% $0.0476 $2,453
<CAPTION>
LINDNER UTILITY FUND <F3>
-------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $15.74 14.52% 0.75% 2.42% 86.44% $0.0376 $53.8
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $16.20 9.80% 0.62% 0.99% 36.70% $0.0408 $8.1
<CAPTION>
LINDNER/RYBACK SMALL-CAP FUND <F4>
----------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $7.67 21.21% 0.59% 0.26% 49.49% $0.0496 $0.2
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $8.49 15.15% 0.66% 0.24% 8.02% $0.0522 $229.6
<CAPTION>
LINDNER BULWARK FUND <F5>
-------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $6.67 -18.61% 1.37% 4.45% 457.57% $0.0314 $1.57
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $6.16 -7.65% 0.93% 8.34% 84.24% $0.0321 $0.1
<CAPTION>
LINDNER INTERNATIONAL FUND <F6>
-------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $11.16 17.06% 1.48% -0.13% 37.79% $0.9954 $0.4
<CAPTION>
Six Months Ended December 31
<S> <C> <C> <C> <C> <C> <C> <C>
1997 $9.66 -11.37% 1.28% -0.85% 22.17 $0.7947 $0.3
<FN>
<F1> For the period July 12, 1996 (initial purchase) to December 31, 1996.
<F2> For the period July 9, 1996 (initial purchase) to December 31, 1996.
<F3> For the period October 31, 1996 (initial purchase) to December 31, 1996.
<F4> For the period November 1, 1996 (initial purchase) to December 31, 1996.
<F5> For the period July 11, 1996 (initial purchase) to December 31, 1996.
<F6> For the period November 1, 1996 (initial purchase) to December 31, 1996.
<F7> Total return for periods of less than one year are not annualized. Total
return is the percentage increase in value for a period, assuming initial
investment at the net asset value on the day before the start of the
period and assuming all dividends and distributions were reinvested and a
redemption at the net asset value on the last day of the period.
</TABLE>
42
