MMA PRAXIS MUTUAL FUNDS, N-30D, 1997-08-25

MMA PRAXIS MUTUAL FUNDS
N-30D, 1997-08-25

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<PAGE>

Semi-Annual Report
FOR THE SIX MONTHS ENDED JUNE 30, 1997

MMA Praxis
Mutual Funds

INTERMEDIATE INCOME FUND
GROWTH FUND
INTERNATIONAL FUND

[LOGO of M M A]
<PAGE>

Message
From
The
President

Dear Shareholders:

The first six months of 1997 continued the strong upward trend in the stock
market. Thus, with only an occasional hiccup, the U.S. stock market has
delivered above average returns for two and one-half years running. Will the
bull market in stocks ever end? More on this later.

HIGHLIGHTS OF THE PREVIOUS SIX MONTHS

Introduction of MMA Praxis International Fund. Beginning April 1, 1997,
socially responsible investors were given the opportunity to obtain exposure
to the world's stock markets through MMA Praxis International Fund. This is
one of only three international mutual funds that invest according to socially
responsible guidelines. The fund will invest primarily in companies located in
Europe, Australia, and the Far East. Investors with a higher tolerance for
risk who are looking to broaden their investment diversification will want to
investigate the opportunities created with this third MMA Praxis fund family
member.

Fund Performance. For the previous six months, MMA Praxis Growth Fund returned
16.16 percent.* MMA Praxis Intermediate Income Fund generated a total return
of 2.18 percent.* Since inception (April 1, 1997), the International Fund has
returned a respectable 15.01 percent.* Please read carefully the comments of
the three portfolio managers for further insights about fund performance and
investment strategy.

Morningstar four-star rating for MMA Praxis Growth Fund. The Growth Fund has
been awarded a four-star.** The fund was rated among 1,997 domestic equity
funds for the three-year period ending June 30, 1997.

SOCIALLY RESPONSIBLE INVESTING (SRI)

Many critics of SRI investing contend it is impossible to generate investment
returns consistent with non-SRI portfolios. Until recently, few studies
existed to dispel this assumption. However, current evidence shows that over
the long term, responsible investors have the potential to do as well or even
better than investors who don't consider their values when making investment
decisions.

A 1995 study by the Investor Responsibility Research Center and Vanderbilt
University discovered that companies who comply with environmental laws have
historically performed better than those who have a track record for
environmental insensitivity.

- -------
*This does not reflect the contingent deferred sales charge. Had the maximum
4.00 percent CDSC charge been applicable, the six-month return would have
been 12.16 percent for the Growth Fund; the six-month return would have been
-1.80 percent for the Intermediate Income Fund; and the since-inception
(April 1, 1997) return would have been 11.10 percent for the International
Fund.

**Morningstar proprietary ratings reflect historical risk-adjusted performance
as of 6/30/97. The ratings are subject to change every month. Past
performance is no guarantee of future results. Morningstar ratings are
calculated from a funds' three, five and 10 year returns (with fee
adjustments) in excess of 90-day Treasury Bill returns and a risk factor
that reflects fund performance below 90-day Treasury Bill returns. 10
percent of the funds in an investment category receive five stars. 22.5
percent receive four stars. At certain times fees have been waived, without
the fee waivers the ranking may have been lower.

-1-
<PAGE>

Message
From
The
President--
continued

- --------------------------------------------------------------------------------
Asset allocation Average Average Average
Stocks - S&P 500 annual total number of loss in
Bonds - U.S. Intermediate Growth return years with losing
a loss years
Cash - U.S. 30 day T-bill
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
Aggressive

Stocks - 100% 10.7% 1 in every 4 -12.3%
- --------------------------------------------------------------------------------
Growth
Bonds - 20%

9.9% 1 in every 4 -9.9%
Stocks - 80%
- --------------------------------------------------------------------------------
Balanced
Bonds - 40%

9.0% 1 in every 5 -8.1%
Stocks - 60%
- --------------------------------------------------------------------------------
Conservative
Cash - 20% Bonds - 40%

7.6% 1 in every 5 -8.1%
Stocks - 40%
- --------------------------------------------------------------------------------
Cash
Cash - 20% Bonds - 60%

6.3% 1 in every 10 -3.0%
Stocks - 20%
- --------------------------------------------------------------------------------
</TABLE>

This example is for illustrative purposes only and is not representative of any
particular investment's past performance and is no guarantee of results.

Source: Ibbotson Associates, based on model portfolios during 1926-96.

-2-
<PAGE>

Message
From
The
President--
continued

John Guerard of Vantage Global Advisors authored an award-winning study*** in
1996 that concluded social investment screens neither help nor hurt risk-
adjusted performance over the long term. Finally, the performance of the
Domini Social Index, a stock index of 400 socially responsible companies
outperformed the S & P 500 (reinvested dividends) over the past five years by
a margin of 16.9 percent versus 15.5 percent.****

The message is clear: market rate returns are possible without making moral
and ethical compromises.

HOW ASSET ALLOCATION CAN HELP LOWER YOUR RISK

The U.S. stock market's climb has been the longest and largest run ever. But
history tells us that sooner or later, a market correction will happen. That's
why now could be a good time to rebalance your portfolio by moving some assets
into bonds and international stocks.

The following chart shows how different blends of stocks, bonds, and cash
(money market funds, CDs, savings accounts, etc.) have the potential to help
lower your risk.

The message of this chart is quite compelling. By increasing your exposure to
bonds and cash, you may be able to reduce your overall level of risk. Of
course, since return follows risk, you could also be reducing your level of
investment return. However, with the explosive growth in the stock market over
the past several years, many investors' percentage of stocks and bonds has
grown beyond their intended target levels. Now may be a good time to stand
back and carefully evaluate your holdings.

At MMA, we believe in the wisdom of asset allocation. It is a very important
determinant of long-term performance. Keep in mind that decisions related to
asset allocation should always consider your time horizon, investment goals,
and risk tolerance. Please contact your financial adviser if you have any
questions about how asset allocation can be used in your particular situation.

FAREWELL TO J.B. MILLER

I would like to express my appreciation to J.B. Miller, past president of MMA
Praxis Mutual Funds. J.B. recently accepted a new position in the financial
services field outside MMA. His vision, dedication, keen marketing mind, and
deep commitment to socially responsible investing will be hallmarks of his
legacy as president of the MMA Praxis Mutual Funds. We wish him well in his
new position. I look forward to assuming more of his responsibilities soon and
carrying on the good work he has begun.

On behalf of MMA Praxis management and the support staff, thank you for your
continued trust and confidence in MMA Praxis Mutual Funds. I realize many of
you have entrusted us with the task of assisting you in meeting important
financial planning goals. Please be assured of our commitment to work hard to
fulfill these stewardship responsibilities.

Sincerely,

LOGO
John L. Liechty, ChFC
President, MMA Praxis Mutual Funds

- -------
***"Is there a cost to being socially responsible in investing?" John B.
Guerard, Jr., Director of Quantitative Research, Vantage Global Advisors,
Inc.; from Journal of Investing, summer 1997.

****Past performance is no guarantee of future results.

-3-
<PAGE>

MMA Praxis Mutual Funds

MMA PRAXIS INTERMEDIATE INCOME FUND
Interest rates finished the six-month period ending June 30 pretty much where
they began the year. In between was a rally in early February, a sharp sell-
off in late February through April, followed by another rally. Long-term bond
yields have continued to trade at between 6.50 percent and 7.1 percent as they
have for two years now.

The total return for the Intermediate Income Fund was 2.18 percent*. In
comparison, the Lehman Corporate Intermediate Index return was 3.05 percent.
The Lipper Intermediate Investment Grade Index was up 2.82 percent.

The bulk of the underperformance was due to the normal administration expenses
of the fund plus the higher bond quality of the fund versus the Lehman
benchmark.

Intermediate Income Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>

- ---------------------------------------
Average Annual Total Return
- ---------------------------------------
Since Inception
Date 1 Year (1/4/94)
- ---------------------------------------
<S> <C> <C>
6/30/97 6.67% 4.78%
6/30/97* 2.67% 4.28%
- ---------------------------------------
</TABLE>

Label A B C
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------
Label CDSC NO CDSC Lehman Corporate
- -------------------------------------------------------------------------------
1 1/4/94 10000 10000 10000
- -------------------------------------------------------------------------------
2 12/31/94 9225 9591 9734
- -------------------------------------------------------------------------------
3 6/30/95 10286 10682 10895
- -------------------------------------------------------------------------------
4 12/31/95 10867 11267 11582
- -------------------------------------------------------------------------------
5 6/30/96 10741 11032 11477
- -------------------------------------------------------------------------------
6 12/31/96 11221 11517 12043
- -------------------------------------------------------------------------------
7 6/30/97 11572 11768 12410
- -------------------------------------------------------------------------------
</TABLE>
* Reflects Applicable Contingent Deferred Sales Charge

Past performance is not indicative of future results. The
investment return and principal value will fluctuate so that
investors' shares, when redeemed, may be worth more or less
than the original cost. CDSC reflects a 4.00 percent
contingent deferred sales charge. The Lehman Corporate
Intermediate Index is an unmanaged index, generally
representative of the intermediate corporate bond market.
This index is for illustrative purposes only and does not
reflect the deduction of expenses associated with a mutual
fund, such as investment management and fund accounting
fees. The fund's performance reflects the deduction of these
value-added services. The total return set forth reflects a
waiver of a portion of the fund's advisory or administrative
fees. In such instances, and without waiver of fees, total
return would have been lower.

We have the portfolio volatility at 4.2 percent, which is in line with the
Lehman benchmark. This means a 1 percent rise or fall in interest rates will
cause the fund value to fall or rise 4.2 percent.

The average bond quality remains a very strong Aa3.

In the social investment area, we added International Multifoods, a flour
miller and food services company, and we continued our pattern of heavy
exposure to housing.

Looking ahead toward the rest of 1997, we expect interest rates to remain in
the trading range of the last two years. We see no inflation problem during
this time, so interest rates may test the lower end of the range in the short
run. The key to second-half performance is how strong demand is for the
remainder of the year. We expect some bounce back from a soft second quarter
that should keep just enough concern in the markets to keep rates from falling
much further. At the same time, the Federal Reserve Board will probably not do
much before late 1997. If we are

-4-
<PAGE>

MMA Praxis Mutual Funds

MMA PRAXIS INTERMEDIATE INCOME FUND (CONTINUED)
wrong and demand remains soft, interest rates could easily drop to 6.25
percent. At that point, mortgage refinancing could quickly recharge consumer's
pocketbooks.

Our main focus will be on finding individual securities that have the
potential to outperform the market. This is a difficult task in a market where
quality spreads are very tight and additional yield is hard to come by.

Delmar King, Investment Manager
MMA Praxis Intermediate Income Fund

- -------
* This does not reflect the contingent deferred sales charge. Had the maximum
4.00 percent CDSC charge been applicable, the six-month return would have
been -1.80 percent for the Intermediate Income Fund.

-5-
<PAGE>

MMA Praxis Mutual Funds

MMA PRAXIS GROWTH FUND

The stock market doesn't get any better than this--or does it? Standard &
Poor's 500 Average was up another 20.6 percent for the first six months of
1997 following a 23.0 percent increase for 1996 and a 37.6 percent rise for
1995. At no time in the last 50 years has the S & P 500 had three consecutive
years greater than 20 percent per year. However, not all mutual fund
shareholders are sharing in this euphoria. According to Lipper Analytical
Services, Inc., the average diversified stock fund was up only 13.0 percent
year-to-date, while the average small stock fund was up 9.0 percent, The stock
mutual funds lagged the S & P 500 by greater than 7 percent for the average
diversified stock fund and 11 percent for the average small stock fund,
respectively year-to-date.

Growth Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>

- ---------------------------------------
Average Annual Total Return
- ---------------------------------------
Since Inception
Date 1 Year (1/4/94)
- ---------------------------------------
<S> <C> <C>
6/30/97 28.29% 18.34%
6/30/97* 24.29% 17.96%
- ---------------------------------------
</TABLE>

Label A B C D
<S> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------
Label CDSC NO CDSC S&P 500 Domini 400
- -------------------------------------------------------------------------------------------------
1 1/4/94 10000 10000 10000 10000
- -------------------------------------------------------------------------------------------------
2 12/31/94 9637 10026 10131 10018
- -------------------------------------------------------------------------------------------------
3 6/30/95 11568 11968 12177 12141
- -------------------------------------------------------------------------------------------------
4 12/31/95 12967 13367 13938 13845
- -------------------------------------------------------------------------------------------------
5 6/30/96 13725 14025 15345 15220
- -------------------------------------------------------------------------------------------------
6 12/31/96 15188 15488 17140 17125
- -------------------------------------------------------------------------------------------------
7 6/30/97 17792 17992 20664 20868
- -------------------------------------------------------------------------------------------------
</TABLE>
* Reflects Applicable Contingent Deferred Sales Charge

Past performance is not indicative of future results. The
investment return and principal value will fluctuate so that
investors' shares, when redeemed, may be worth more or less
than the original cost. CDSC reflects a 4.00 percent
contingent deferred sales charge. The S&P 500 Index and the
Domini 400 Social Index are unmanaged indexes, generally
representative of the stock market and the socially
responsible investment market, respectively. These indexes
are for illustrative purposes only and do not reflect the
deduction of expenses associated with a mutual fund, such as
investment management and fund accounting fees. The fund's
performance reflects the deduction of these value-added
services. The total return set forth reflects a waiver of a
portion of the fund's advisory or administrative fees. In
such instances and without waiver of fees, the total return
would have been lower.

The Growth Fund outperformed the average stock mutual fund, tracked by Lipper
in the Growth and Income category, by 3.2 percent for the first half of 1997
with a return of 16.16 percent*. While analyzing the individual companies that
make up the stock market, we find that of the 5,460 actively traded stocks,
the average price return was only 8.4 percent. Once again, the largest of the
mega-cap stocks were the best performing stocks within a very narrow market.

The top 10 holdings as of June 30, 1997 (composition subject to change) were
Sigma-Aldrich (3.4%), Boston Scientific Corp (3.2%), Williams Co., Inc.
(3.2%), SBC Communications (3.1%), Gannett Co., Inc. (3.1%), Albertsons, Inc.
(3.1%), Deere & Company (3.0%), Pitney Bowes, Inc. (2.8%), Allstate (2.8%) and
MCN Corp. (2.8%).

-6-
<PAGE>

MMA Praxis Mutual Funds

MMA PRAXIS GROWTH FUND (CONTINUED)

ECONOMIC CONDITIONS COULD NOT BE BETTER

One of the most important forces behind the equity market is the increasing
evidence the economy is slowing and inflation is all but dead. Inflation as
measured by the Consumer Price Index (CPI) has been between 0 percent and 3.5
percent for the last 69 consecutive months. Some people, including Alan
Greenspan, believe the CPI overstates the real inflation rate even at these
low stated rates.

Corporate profits continue to be strong. We should see double-digit growth in
profits in 1997 and single-digit growth rates in a range of 5 percent to 8
percent in 1998. While the earnings growth is slowing, the growth is positive
and no recession is in sight.

Severe recessions have typically been caused by an inventory correction or by
Federal Reserve Board tightening to ward off inflation. Inventory levels are
less of a factor today because of the much improved information technology
available to manage inventories more efficiently. At the same time, the Fed is
unlikely to raise rates significantly because there is less likelihood of a
boom or bust cycle. In addition, inflation is under control and real rates of
interest are high. With everything going right in the economy, why can't the
stock market keep going higher?

MARKET VALUATION

All this wonderful economic news seems to be more than priced into the stock
prices for the large-cap segment of the market. While not all nifty fifty
stocks are overpriced, we believe a number of the stocks are. In our opinion,
while stocks like Procter & Gamble, Coca-Cola, and Gillette all seem
expensive, they continue to do well in today's market. Some of these stocks
are selling at record price/earnings ratios that have not been seen for the
last 24 years. It has been easy to build a case that these types of stocks are
fully priced but they keep going higher. How much longer? Many money managers
have been underperforming the overall market because they have not owned
enough nifty fifty stocks. We are no exception. We have been buying companies
where we believe growth will continue and valuations are not extended. In this
regard, we have been buying medium-sized companies and selling a number of the
mega-cap companies. During the first six months, we started new positions in
Pep Boys, Cisco Systems, Read-Rite, Williams Companies, Norwest, MCN, First
Data Corp., and Boston Scientific. At the same time, we have sold our
positions in McDonalds, Johnson & Johnson, Procter & Gamble, American
International Group, Eli Lilly, Merck, and Intel Corp.

The current weighted average market cap size in MMA Praxis Growth Fund is
$18.5 billion, whereas the S & P 500 is $51.4 billion. We find comfort with
our investments in these companies and believe the price/earnings ratios,
growth rates and valuations of these companies will be evident to other
investors and perform well relative to the overall market going forward.

At times we have talked about the necessity to stick to our discipline and not
wander from what has worked for us over the years. Today's enthusiasm for the
nifty fifty stocks and influences of indexing are constant reminders to us to
watch our valuations as we select the stocks for the portfolio. Our decisions
are made with what we believe may be the ultimate potential for each
individual company and to look past current trends that will likely be short
lived.

INVESTOR SENTIMENT

One of my biggest worries is the extreme bullish sentiment of today's
investors. Bullish sentiment as measured by Market Vain is at an all-time
high. This is a positive affirmation for today's market, but, at the same
time, is very scary for the contrarian side of us.

-7-
<PAGE>

MMA Praxis Mutual Funds

MMA PRAXIS GROWTH FUND (CONTINUED)

In addition, we all know it has been a difficult time for stock market bears.
Having as little as 10 percent cash in the portfolio has cost money managers 2
percent in return relative to the S & P 500. Many historians and money
managers who were able to make a very strong case for a bear market in 1997
have all but given up and are starting to believe in the "new paradigm." Old-
timers are beginning to look at the market and think maybe it is different
this time and are questioning historical measurements. The slow inflationary
growth, expanding earnings, declining interest rates and, of course, all of
the money coming into the market from the baby boomers for retirement have
fueled today's valuation levels. New justifications are running rampant. In
all of this, we are seeing the last of the holdouts for a bear market throwing
in the towel or at least being complacent with today's stock market.

To answer the original question of whether the stock market can go higher, the
answer is yes or at least until something happens. It will likely be something
totally unexpected and out of the blue. The old adage--buy low, sell high--
seems like a reasonable way to invest. As the prices of the nifty fifty
continue to rise, we are going shopping elsewhere. Thank you for your
confidence and placing your investments with the MMA Praxis Growth Fund.

Keith Yoder, Investment Manager MMA Praxis Growth Fund
- -------
* This does not reflect the contingent deferred sales charge. Had the maximum
4.00 percent CDSC charge been applicable, the six-month return would have
been 12.16 percent for the Growth Fund.

-8-
<PAGE>

MMA Praxis Mutual Funds

MMA PRAXIS INTERNATIONAL FUND

MMA Praxis International Fund outperformed its benchmark, the Morgan Stanley
Capital Index (MSCI) EAFE index, by approximately 270 basis points during the
second quarter of 1997. Your portfolio was up 15.01* percent, whereas the EAFE
benchmark was up 13.0 percent (with net dividends reinvested). The
outperformance during the second quarter was primarily due to our overweight
positions in strong markets like Hong Kong (+19.40 percent return in U.S.
dollar terms), Spain (+21.60 percent return), and Japan (+23.5 percent
return); underweight exposure in lagging markets like the United Kingdom
(+7.17 percent return) and Singapore (-1.20 percent return); and excellent
stock selection in Japan.

International Fund
Value of a $10,000 Investment
<TABLE>
<CAPTION>

- ---------------------------------------
Average Annual Total Return
- ---------------------------------------
Since Inception
Date (4/1/97)
- ---------------------------------
<S> <C>
6/30/97 15.01%
6/30/97* 11.01%
- ---------------------------------------
</TABLE>

Label A B C
<S> <C> <C> <C> <C>
- -------------------------------------------------------------------------------
Label CDSC NO CDSC MSCI EAFE
- -------------------------------------------------------------------------------
1 1/4/94 10000 10000 10000
- -------------------------------------------------------------------------------
2 6/30/97 11101 11501 11300
- -------------------------------------------------------------------------------
</TABLE>
* Reflects Applicable Contingent Deferred Sales Charge

Past performance is not indicative of future results. The
investment return and principal value will fluctuate so that
investors' shares, when redeemed, may be worth more or less
than the original cost. CDSC reflects a 4.00 percent
contingent deferred sales charge. The MSCI EAFE Index is an
unmanaged index, generally representative of international
stocks. This index is for illustrative purposes only and
does not reflect the deduction of expenses associated with a
mutual fund, such as investment management and fund
accounting fees. The fund's performance reflects the
deduction of these value-added services. The total return
set forth reflects a waiver of a portion of the Fund's
advisory or administrative fees. In such instances, and
without waiver of fees, the total return would have been
lower.

International investing involves increased risk and
volatility.

For the second quarter of 1997, the MSCI Pacific index (+18.7 percent in U.S.
dollar terms) outperformed the MSCI Europe Index (+8.94 percent). Strong
returns in Japan (+23.5 percent) and Hong Kong (+19.4 percent) were offset by
weak performance in Malaysia (-12.1 percent) and Singapore (-1.2 percent). In
Europe, the best performing markets were Spain (+21.6 percent), Switzerland
(+18.8 percent) and Italy (+9.33 percent); while the worst performing were
France (+2.7 percent) and Germany (+4.6 percent). The MSCI Emerging Markets
Free index was up 7.7 percent, with MSCI EMF Latin America up 20.9 percent,
and MSCI EMF Asia up only 1.0 percent. The portfolio's performance was
enhanced by our exposure in these strong Latin American markets with positions
in Telebras in Brazil and Telmex in Mexico.

Unlike the first quarter of 1997 where the U.S. dollar continued to strengthen
against all major currencies, we saw the U.S. dollar weaken against the yen
and sterling during the second quarter. The move in the yen occurred primarily
in the month of May following remarks from Sakakibara ("Mr. Yen") that the
dollar's rally had gone too far and he could see the yen back up to 105. Pound
sterling gained against the dollar as U.K. interest rates moved higher.

-9-
<PAGE>

MMA Praxis Mutual Funds

MMA PRAXIS INTERNATIONAL FUND (CONTINUED)

Against the Continental European currencies, the U.S. dollar strengthened as
uncertainty over European Monetary Union (EMU) made the dollar a safe haven.

Japan's strong move during the quarter had a significant impact on performance
given the portfolio's overweight position and positive contribution from stock
selection. The market rebounded on the back of better-than-expected economic
growth (expectations were very low due to the concern that the increase in the
consumption tax would dampen economic activity); rumors that the Bank of Japan
would allow a big bank to go bankrupt (marking a turning point in the
financial crisis in Japan); and a technically oversold market. In terms of
stock selection in Japan, the portfolio had an overweight position in the
financial sector which proved to be beneficial: Mitsubishi Trust (+47.7
percent return--1.31 percent of the porfolio), Sumitomo Bank (+27.9 percent
return--1.82 percent of the porfolio) and Sumitomo Trust (+24.2 percent
return--1.34 percent of the porfolio) outperformed the MSCI Japan index (+14.1
percent return in local currency terms) by a wide margin. Other stocks that
enhanced performance were Nippon Telephone & Telegraph (26.3 percent return--
1.99 percent of the porfolio), NTT Data (34.7 percent return--1.61 percent of
the porfolio), Pioneer Electric (37.6 percent return--1.34 percent of the
porfolio) and Rohm (+27.1 percent return--1.42 percent of the porfolio).

The top 10 holdings as of June 30, 1997 (composition subject to change) were
Sony Corp. (3.8%), Volkswagon (3.3%), Stet Societa Finanziaria Telefonica
(3.3%), Novartis REG (2.8%), Hoechst AG (2.7%), Astra A (2.7%), Fiat Spa
(2.6%), Roche Holding (2.5%), Vodafone (2.4%) and ASDA Group (2.4%).

In Europe, the U.K. and French markets were volatile before and after the
election results. In the U.K., Tony Blair's victory was not a surprise, but
concern over higher interest rates and a tough budget negatively impacted
sentiment. The strength of sterling is still resulting in earnings downgrades
for the export sector. In France, the come-from-behind Socialist victory was a
shock. The market discounted this possibility during the last two weeks of May
(between the first and second rounds of the election). Concerns about the
Socialists making radical policy changes and delaying or even ending EMU were
overdone as it became quite evident after the election that the Socialists
would be forced by the markets to be more moderate in their ways. The market
was up 8.3 percent in U.S. dollar terms in June after having negative
performance in April and May. In Europe, the portfolio is overweight in
France, Germany, Italy, Spain and Sweden.

Looking forward, we remain optimistic for equity markets in the medium term.
In Europe, we believe that EMU will happen; however, in a slightly weaker
form. We remain overweight in Italy and Spain because we expect them to
participate in the first round of EMU, which will positively impact their bond
and equity markets. We are also moving to a more overweight position in France
because we are finding excellent value in certain stocks and we think concerns
over the new Socialist government are still overdone. We view any weakness in
France as a good buying opportunity. In Japan, economic recovery is proving to
be stronger than the consensus expected. Earnings growth should be positive,
but inflation should be non-existent allowing interest rates to remain at
these low levels. We are presently in the process of reducing our exposure in
some of the financial stocks in Japan as these stocks have had significant
moves and have almost fully discounted the positive newsflow.

Oechsle International Advisors, L.P. MMA Praxis International Fund
- -------
* This does not reflect the contingent deferred sales charge. Had the maximum
4.00 percent CDSC charge been applicable, the since-inception (April 1,
1997) return would have been 11.10 percent for the International Fund.

-10-
<PAGE>

TABLE OF CONTENTS

Statements of Assets and Liabilities
Page 12

Statements of Operations
Page 13

Statements of Changes in Net Assets
Page 14

Schedules of Portfolio Investments
Page 15

Notes to Financial Statements
Page 23

Financial Highlights
Page 29

-11-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
INTERMEDIATE
INCOME GROWTH INTERNATIONAL
FUND FUND FUND
------------ ----------- -------------
<S> <C> <C> <C>
ASSETS:
Investments, at value (Cost $29,129,104
and $67,146,972 and
$6,380,332, respectively)............. $29,303,868 $83,213,485 $7,240,987
----------- ----------- ----------
Cash................................... -- 119,056 558,612
Interest and dividends receivable...... 460,994 70,285 6,986
Receivable for capital shares issued... 10 1,278 10,000
Receivable for investments sold........ 316 -- 30,643
Foreign currency (Cost $24,488)........ -- -- 26,143
Tax reclaim receivable................. -- -- 2,910
Receivable from Investment Adviser..... -- -- 41,302
Unamortized organization costs......... 10,170 9,880 16,139
Prepaid expenses....................... 9,580 43,265 11,085
----------- ----------- ----------
Total Assets....................... 29,784,938 83,457,249 7,944,807
----------- ----------- ----------
LIABILITIES:
Cash overdraft......................... 53,375 -- --
Accrued expenses and other payables:
Investment advisory fees............. 5,014 51,638 3,057
Administration fees.................. 548 914 547
Distribution fees.................... 1,219 28,006 33
Shareholder service fees............. 1,943 5,011 314
Trustees' fees....................... 2,458 5,526 161
Legal and audit fees................. 1,975 1,392 6,757
Custodian and accounting fees........ 11,659 10,779 4,554
Printing costs....................... 3,043 3,799 2,380
Other................................ 2,745 3,889 6,157
----------- ----------- ----------
Total Liabilities.................. 83,979 110,954 23,960
----------- ----------- ----------
NET ASSETS:
Capital................................ 29,790,819 62,743,898 6,997,800
Undistributed (distributions in excess
of) net investment income.............. 48,846 (10,387) 3,346
Net unrealized appreciation from
investments and translation
of assets and liabilities in foreign
currency............................... 174,764 16,066,513 862,133
Accumulated undistributed net realized
gains (losses)
from investments and foreign currency
transactions........................... (313,470) 4,546,271 57,568
----------- ----------- ----------
Net Assets......................... $29,700,959 $83,346,295 $7,920,847
=========== =========== ==========
Outstanding units of beneficial
interest (shares)...................... 3,034,268 5,298,288 688,920
=========== =========== ==========
Net asset value--offering price per
share*................................. $ 9.79 $ 15.73 $ 11.50
=========== =========== ==========
</TABLE>
- -------
* Redemption price per share varies based on length of time shares are held
(Note 4).

See notes to financial statements.

-12-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

STATEMENTS OF OPERATIONS
(UNAUDITED)

<TABLE>
<CAPTION>
INTERMEDIATE
INCOME GROWTH INTERNATIONAL
FUND FUND FUND
------------ ----------- -------------
SIX MONTHS SIX MONTHS APRIL 1, 1997
ENDED ENDED THROUGH
JUNE 30, JUNE 30, JUNE 30,
1997 1997 1997 (A)
------------ ----------- -------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income........................ $ 979,044 $ 173,741 $ 5,278
Dividend income........................ -- 569,770 35,451
Foreign tax withholding................ -- -- (5,286)
--------- ----------- --------
Total Income......................... 979,044 743,511 35,443
--------- ----------- --------
EXPENSES:
Investment advisory fees............... 71,464 262,952 14,044
Administration fees.................... 24,698 36,284 25,000
Distribution fees...................... 142,928 355,340 15,605
Shareholder service fees............... 35,732 88,835 3,901
Custodian and accounting fees.......... 25,741 24,501 16,062
Legal and audit fees................... 9,226 21,904 6,757
Organization costs..................... 3,441 3,258 4,452
Trustees' fees and expenses............ 4,694 10,814 480
Transfer agent fees.................... 30,493 76,080 13,284
Registration and filing fees........... 13,116 21,238 7,205
Printing costs......................... 7,234 14,115 2,374
Other.................................. 1,496 1,974 669
--------- ----------- --------
Total expenses before reimbursement
from investment adviser and
voluntary reductions................ 370,263 917,295 109,833
Expenses voluntarily reduced and/or
reimbursed.......................... (211,075) (302,366) (78,427)
Expenses paid by third parties....... (2,102) (2,945) --
--------- ----------- --------
Total Expenses....................... 157,086 611,984 31,406
--------- ----------- --------
Net Investment Income.................. 821,958 131,527 4,037
--------- ----------- --------
REALIZED/UNREALIZED GAINS (LOSSES) FROM
INVESTMENTS:
Net realized gains (losses) from
investment transactions................ (22,575) 3,591,722 65,746
Net realized loss from foreign currency
transactions........................... -- -- (8,178)
Net change in unrealized appreciation
(depreciation) from investments........ (177,503) 7,252,930 860,655
Net change in unrealized appreciation
from foreign currency transactions..... -- -- 1,478
--------- ----------- --------
Net realized/unrealized gains (losses)
from investments....................... (200,078) 10,844,652 919,701
--------- ----------- --------
Change in net assets resulting from
operations............................. $ 621,880 $10,976,179 $923,738
========= =========== ========
</TABLE>
- -------
(a) Period from commencement of operations.

See notes to financial statements.

-13-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

STATEMENTS OF CHANGES IN NET ASSETS

<TABLE>
<CAPTION>
INTERMEDIATE INCOME FUND GROWTH FUND INTERNATIONAL FUND
------------------------- ------------------------- ------------------
SIX MONTHS YEAR SIX MONTHS YEAR APRIL 1, 1997
ENDED ENDED ENDED ENDED THROUGH
JUNE 30, DECEMBER 31, JUNE 30, DECEMBER 31, JUNE 30,
1997 1996 1997 1996 1997 (A)
----------- ------------ ----------- ------------ ------------------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C>
FROM INVESTMENT ACTIVI-
TIES:
OPERATIONS:
Net investment income.. $ 821,958 $ 1,400,778 $ 131,527 $ 274,780 $ 4,037
Net realized gains
(losses) from
investment transac-
tions................. (22,575) 21,386 3,591,722 2,178,561 65,746
Net realized loss from
foreign currency
transactions.......... -- -- -- -- (8,178)
Net change in
unrealized apprecia-
tion (depreciation)
from investments...... (177,503) (776,579) 7,252,930 4,711,729 860,655
Net change in
unrealized apprecia-
tion from foreign
currency
transactions.......... -- -- -- -- 1,478
----------- ----------- ----------- ----------- ----------
Change in net assets re-
sulting from
operations............. 621,880 645,585 10,976,179 7,165,070 923,738
----------- ----------- ----------- ----------- ----------
DISTRIBUTIONS TO SHARE-
HOLDERS:
From net investment in-
come.................. (772,824) (1,400,778) (157,283) (264,757) (691)
In excess of net in-
vestment income....... -- (5,243) -- -- --
From net realized gains
from investment
transactions.......... -- -- -- (1,413,536) --
Tax return of capital.. -- (2,071) -- -- --
----------- ----------- ----------- ----------- ----------
Change in net assets
from distributions to
shareholders........... (772,824) (1,408,092) (157,283) (1,678,293) (691)
----------- ----------- ----------- ----------- ----------
CAPITAL TRANSACTIONS:
Proceeds from shares
issued................ 3,328,435 6,287,831 16,097,460 25,680,520 6,997,800
Dividends reinvested... 329,461 399,174 131,560 2,481,464 --
Cost of shares re-
deemed................ (1,374,001) (1,826,138) (2,608,350) (5,647,554) --
----------- ----------- ----------- ----------- ----------
Change in net assets
from capital transac-
tions.................. 2,283,895 4,860,867 13,620,670 22,514,430 6,997,800
----------- ----------- ----------- ----------- ----------
Change in net assets.... 2,132,951 4,098,360 24,439,566 28,001,207 7,920,847
NET ASSETS:
Beginning of period.... 27,568,008 23,469,648 58,906,729 30,905,522 --
----------- ----------- ----------- ----------- ----------
End of period.......... $29,700,959 $27,568,008 $83,346,295 $58,906,729 $7,920,847
=========== =========== =========== =========== ==========
SHARE TRANSACTIONS:
Issued................. 340,715 638,171 1,123,335 2,024,654 688,920
Reinvested............. 33,796 40,632 9,492 194,454 --
Redeemed............... (141,111) (186,152) (175,005) (438,149) --
----------- ----------- ----------- ----------- ----------
Change in shares........ 233,400 492,651 957,822 1,780,959 688,920
=========== =========== =========== =========== ==========
</TABLE>
- -------
(a) Period from commencement of operations.

See notes to financial statements.

-14-
<PAGE>

MMA PRAXIS MUTUAL FUNDS
INTERMEDIATE INCOME FUND

SCHEDULE OF PORTFOLIO INVESTMENTS
JUNE 30, 1997
(UNAUDITED)

<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------ -----------
<C> <S> <C>
ASSET BACKED SECURITIES (3.6%):
250,000 American Express Master Trust, 7.85%, 8/15/05......... $ 264,263
300,000 Chemical Master Credit Card Trust 1, 6.23%, 4/15/05... 294,906
250,000 Circuit City Credit Card Master Trust, 8.00%,
11/15/03............................................. 259,580
250,000 Standard Credit Card Master Trust, 7.25%, 4/7/08...... 254,967
-----------
Total Asset Backed Securities 1,073,716
-----------
COLLATERALIZED MORTGAGE OBLIGATIONS (1.7%):
500,000 Vendee Mortgage Trust, 6.75%, 3/15/06................. 495,190
-----------
Total Collateralized Mortgage Obligations 495,190
-----------
CORPORATE BONDS (51.1%):
Banking (4.6%):
500,000 Banc One, 7.25%, 8/1/02............................... 507,500
350,000 Nations Bank Corp., 7.00%, 9/15/01.................... 351,750
500,000 Suntrust Banks, Inc., 7.38%, 7/1/06................... 509,375
-----------
1,368,625
-----------
Financial Services (4.0%):
500,000 W.R. Berkley Corp., 6.25%, 1/15/06.................... 465,625
400,000 Protective Life, 7.95%, 7/1/04........................ 411,500
300,000 US Life Corp., 6.75%, 1/15/98......................... 301,449
-----------
1,178,574
-----------
Industrial Goods & Services (6.0%):
300,000 NGC Corp., 6.75%, 12/15/05............................ 291,750
250,000 Potash Corp., 7.13%, 6/15/07.......................... 249,063
250,000 Rite Aid Corp., 7.13%, 1/15/07........................ 247,500
500,000 Witco Corp., 6.60%, 4/1/03............................ 491,875
500,000 Worthington Industries, 7.13%, 5/15/06................ 502,500
-----------
1,782,688
-----------
Insurance (2.2%):
250,000 Allstate Corp., 6.75%, 6/15/03........................ 244,375
165,000 Chubb Corp., 8.75%, 11/15/99.......................... 173,456
250,000 Harleysville Group, 6.75%, 11/15/03................... 244,688
-----------
662,519
-----------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Machinery & Equipment (0.9%):
250,000 John Deere Capital Corp., 8.63%, 8/1/19 *.............. $ 264,375
-----------
Office Equipment & Services (3.0%):
500,000 Pitney Bowes, 9.25%, 6/15/08 *......................... 583,750
300,000 Xerox Credit Corp., 10.00%, 4/1/99..................... 316,875
-----------
900,625
-----------
Oil & Gas Exploration & Production Services (1.8%):
250,000 Burlington Resources, 9.63%, 6/15/00................... 270,000
250,000 Louisiana Land & Exploration, 8.25%, 6/15/02........... 257,500
-----------
527,500
-----------
Oil & Gas Transmission (2.5%):
355,000 Atlantic Richfield Co., 10.25%,
7/2/00 *.............................................. 361,213
250,000 El Paso Natural Gas, 9.45%, 9/1/99..................... 264,062
100,000 Questar Pipeline Co., 9.88%, 6/1/20 *.................. 110,875
-----------
736,150
-----------
Paper Products (0.9%):
250,000 Westvaco Corp., 10.25%, 7/1/18 *....................... 264,062
-----------
Pharmaceuticals (0.9%):
250,000 Eli Lilly, 8.38%, 12/1/06.............................. 274,062
-----------
Railroads (1.7%):
250,000 Consolidated Railroad Co., 9.75%, 6/1/00............... 270,312
250,000 Union Pacific Co., 6.00%, 9/1/03....................... 234,063
-----------
504,375
-----------
Retail Stores (4.2%):
250,000 Kohl's Corp., 6.70%, 2/1/06............................ 241,875
250,000 Lowe's Co., 6.38%, 12/15/05............................ 239,062
500,000 J C Penney & Co., 7.25%, 4/1/02........................ 507,500
260,000 Supervalu, Inc., 7.80%, 11/15/02....................... 269,100
-----------
1,257,537
-----------
Savings & Loans (0.9%):
250,000 Golden West Financial, 10.25%, 12/1/00................. 276,562
-----------
</TABLE>

Continued

-15-
<PAGE>

MMA PRAXIS MUTUAL FUNDS
INTERMEDIATE INCOME FUND

SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)

<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Supermarkets (0.9%):
250,000 Secured Finance, Inc.--Kroger, 9.05%, 12/15/04......... $ 279,687
-----------
Textile Products (0.9%):
250,000 V F Corp., 7.60%, 4/1/04 *............................. 252,500
-----------
Transportation & Shipping (1.9%):
250,000 General American Transportation, 8.63%, 12/1/04........ 270,000
300,000 Union Tank Car, 7.13%, 2/1/07.......................... 298,875
-----------
568,875
-----------
Utilities--Electric (5.8%):
250,000 Alabama Power Co., 7.00%, 1/1/03 *..................... 250,625
450,000 Allegheny Generating Co., 5.63%, 9/1/03................ 420,750
250,000 Florida Power & Electric, 6.88%, 4/1/04................ 247,813
300,000 Iowa Electric Light & Power Co., 8.63%, 5/15/01........ 318,375
250,000 Pennsylvania Power & Light Co., 7.75%, 5/1/02.......... 259,375
250,000 Potomac Electric Power Co., 5.00%, 9/1/02.............. 229,688
-----------
1,726,626
-----------
Utilities--Gas (1.8%):
250,000 Equitable Resources, 7.50%, 7/1/99..................... 255,313
250,000 Southern Natural Gas, 8.88%, 2/15/01................... 266,875
-----------
522,188
-----------
Utilities--Gas & Electric (2.6%):
250,000 Baltimore Gas & Electric Co., 8.38%, 8/15/01........... 264,063
250,000 Pacific Gas & Electric Co., 9.06%, 12/15/97............ 253,438
246,000 Public Service Electric Co., 6.00%, 7/1/98............. 245,692
-----------
763,193
-----------
Utilities--Telephone (3.6%):
500,000 Mountain States Telephone, 9.50%, 5/1/00............... 537,500
250,000 Northwestern Bell Telephone, 9.50%, 5/1/00............. 267,812
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
CORPORATE BONDS, CONTINUED:
Utilities--Telephone, continued:
250,000 Southern New England Telephone, 7.13%, 8/1/07.......... $ 251,563
-----------
1,056,875
-----------
Total Corporate Bonds 15,167,598
-----------
MEDIUM TERM NOTES (4.7%):
Finance (0.9%):
250,000 Capital Holding Corp., 9.27%, 5/7/01................... 270,313
-----------
Industrial (0.8%):
250,000 International Multifoods, 6.71%, 10/5/00............... 247,500
-----------
Pharmaceuticals (0.8%):
250,000 SmithKline Beecham Corp., 7.50%, 5/1/02 *.............. 252,188
-----------
Utilities--Electric (2.1%):
250,000 Kentucky Power, 6.65%, 5/1/03.......................... 244,375
400,000 Southwestern Bell Capital, 6.62%, 11/27/06............. 386,000
-----------
630,375
-----------
Total Medium Term Notes 1,400,376
-----------
U.S. GOVERNMENT AGENCIES (37.6%):
Export Funding Trust:
200,000 7.89%, 2/15/05......................................... 208,286
Federal Home Loan Mortgage Corp.:
192,273 6.50%, 12/1/99......................................... 190,779
1,000,000 5.78%, 10/22/03........................................ 946,030
250,000 7.50%, 10/25/04........................................ 255,400
500,000 6.00%, 8/15/07, CMO.................................... 488,635
488,246 7.00%, 11/1/07......................................... 487,918
523,370 7.00%, 7/1/15.......................................... 514,294
480,253 6.50%, 11/1/15......................................... 460,816
516,189 7.00%, 4/1/16.......................................... 507,057
Federal National Mortgage Association:
1,000,000 5.68%, 10/2/01......................................... 1,001,530
497,652 6.47%, 12/1/01......................................... 491,138
1,000,000 6.83%, 5/1/02.......................................... 1,012,540
246,305 7.03%, 9/1/05.......................................... 247,379
297,158 6.71%, 5/1/06.......................................... 295,497
450,000 7.38%, 9/1/06.......................................... 460,125
650,000 6.50%, 10/25/06, CMO................................... 646,731
497,465 7.45%, 10/1/11......................................... 504,768
</TABLE>

Continued

-16-
<PAGE>

MMA PRAXIS MUTUAL FUNDS
INTERMEDIATE INCOME FUND

SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>

PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- -------------------------------------------------------- -----------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES, CONTINUED:
Federal National Mortgage Association, continued:
250,000 7.30%, 8/17/18.......................................... $ 253,320
351,000 7.75%, 9/17/23.......................................... 359,007
Government National Mortgage Association:
389,865 6.50%, 11/15/10, Pool # 417766.......................... 388,204
301,858 7.50%, 2/15/23, Pool # 328498........................... 301,303
493,893 7.00%, 3/15/26, Pool # 398518........................... 485,280
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
U.S. GOVERNMENT AGENCIES, CONTINUED:
Small Business Administration:
168,573 6.00%, 9/25/18, Pool # 502410 ......................... $ 168,986
496,934 7.35%, 8/1/05, SBIC 95-C .............................. 491,965
-----------
Total U.S. Government Agencies 11,166,988
-----------
Total (Cost--$29,129,104)(a) $29,303,868
===========
</TABLE>
- -------
Percentages indicated are based on net assets of $29,700,959.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:

<TABLE>
<S> <C>
Unrealized
appreciation........... $400,953
Unrealized
depreciation........... (226,189)
--------
Net unrealized
appreciation........... $174,764
========
</TABLE>

* Put and demand features exist allowing the Fund to require the repurchase
of the instrument within variable time periods of less than one year.

CMO--Collateralized Mortgage Obligation

See notes to financial statements.

-17-
<PAGE>

MMA PRAXIS MUTUAL FUNDS
GROWTH FUND

SCHEDULE OF PORTFOLIO INVESTMENTS
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
COMMON STOCKS (94.5%):
Automotive Parts (2.0%):
50,000 Pep Boys Manny, Moe & Jack............................. $ 1,703,125
-----------
Banks (8.5%):
22,500 AmSouth Bankcorp....................................... 850,781
30,000 BankAmerica Corp....................................... 1,936,875
34,000 First Chicago Corp..................................... 2,057,000
28,000 Keycorp................................................ 1,564,500
12,000 Norwest Corp........................................... 675,000
-----------
7,084,156
-----------
Building Materials (1.7%):
35,000 Masco Corp............................................. 1,461,250
-----------
Chemicals--General (4.7%):
13,000 Air Products & Chemicals, Inc.......................... 1,056,250
81,000 Sigma-Aldrich.......................................... 2,840,063
-----------
3,896,313
-----------
Computers & Peripherals (6.1%):
34,000 Cisco Systems (b)...................................... 2,282,250
36,000 Hewlett-Packard Co..................................... 2,016,000
40,000 Read-Rite Corp. (b).................................... 835,000
-----------
5,133,250
-----------
Containers--Metal, Glass, Paper, Plastic (1.8%):
50,000 Sonoco Products Co..................................... 1,521,875
-----------
Electronic & Electrical--General (4.6%):
32,000 Emerson Electric Co.................................... 1,762,000
40,200 Thomas & Betts Corp.................................... 2,113,013
-----------
3,875,013
-----------
Environmental Control (1.7%):
31,900 Ionics, Inc. (b)....................................... 1,451,450
-----------
Financial Services (2.4%):
45,000 Federal National Mortgage Assoc........................ 1,963,125
-----------
Food Distributors & Wholesalers (5.7%):
70,000 Albertsons, Inc........................................ 2,555,000
61,000 Sysco Corp............................................. 2,226,500
-----------
4,781,500
-----------
Forest Products--Lumber, Paper (2.4%):
28,000 Willamette Industries, Inc............................. 1,960,000
-----------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Heavy Machinery--Industrial, Farm, Construction (3.0%):
45,000 Deere & Co............................................. $ 2,469,375
-----------
Insurance--Property, Casualty, Health (5.5%):
32,000 Allstate Corp.......................................... 2,336,000
33,000 Chubb Corp............................................. 2,206,875
-----------
4,542,875
-----------
Medical Supplies (6.7%):
47,000 Biomet, Inc. (b)....................................... 875,375
43,000 Boston Scientific Corp. (b)............................ 2,641,812
54,000 St. Jude Medical, Inc. (b)............................. 2,106,000
-----------
5,623,187
-----------
Newspapers (3.1%):
26,000 Gannett Co., Inc....................................... 2,567,500
-----------
Office Equipment & Supplies (2.8%):
33,000 Pitney Bowes, Inc...................................... 2,351,250
-----------
Oil & Gas Exploration, Production, & Services (10.1%):
26,000 Amoco Corp............................................. 2,260,375
33,000 Anadarko Petroleum..................................... 1,980,000
22,000 Atlantic Richfield Co.................................. 1,551,000
60,000 Williams Co., Inc...................................... 2,625,000
-----------
8,416,375
-----------
Pharmaceuticals (2.3%):
65,000 Alza Corp., Class A (b)................................ 1,880,937
-----------
Precision Instruments & Related (1.5%):
25,000 Dionex Corp. (b)....................................... 1,281,250
-----------
Publishing (0.6%):
13,200 R.R. Donnelley & Sons Co............................... 483,450
-----------
Retail (3.7%):
45,000 Lowes Cos., Inc........................................ 1,670,625
30,000 May Department Stores.................................. 1,417,500
-----------
3,088,125
-----------
Software & Computer Services (1.6%):
30,000 First Data Corp........................................ 1,318,125
-----------
Textile Manufacturing (1.0%):
9,500 V. F. Corp............................................. 808,688
-----------
Trucks--Manufacturing (2.2%):
65,000 Wabash National Corp................................... 1,811,875
-----------
</TABLE>

Continued

-18-
<PAGE>

MMA PRAXIS MUTUAL FUNDS
GROWTH FUND

SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
Utilities--Natural Gas (5.7%):
30,000 Consolidated Natural Gas............................... $ 1,614,375
15,000 El Paso Natural Gas.................................... 825,000
75,000 MCN Corp............................................... 2,296,875
-----------
4,736,250
-----------
Utilities--Telecommunications (3.1%):
42,000 SBC Communications..................................... 2,598,750
-----------
Total Common Stocks 78,809,069
-----------
PREFERRED STOCKS (0.3%):
Financial Services:
10,000 American General Capital, 8.13%, 9/30/25............... 256,250
-----------
Total Preferred Stocks 256,250
-----------
</TABLE>
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL SECURITY MARKET
AMOUNT DESCRIPTION VALUE
--------- ------------------------------------------------------- -----------
<C> <S> <C>
REAL ESTATE INVESTMENT TRUST (0.9%):
18,600 Duke Realty Investments, Inc........................... $ 753,300
-----------
Total Real Estate Investment Trust 753,300
-----------
U.S. GOVERNMENT AGENCIES (4.1%):
Federal National Mortgage Association:
3,400,000 7/10/97................................................ 3,394,866
-----------
Total U.S. Government Agencies 3,394,866
-----------
Total (Cost--$67,146,972)(a) $83,213,485
===========
</TABLE>
- -------
Percentages indicated are based on net assets of $83,346,295.
(a) Represents cost for federal income tax purposes and differs from value by
net unrealized appreciation of securities as follows:

<TABLE>
<S> <C>
Unrealized
appreciation......... $16,434,122
Unrealized
depreciation......... (367,609)
-----------
Net unrealized
appreciation......... $16,066,513
===========
</TABLE>
(b) Non-income producing securities.

See notes to financial statements.

-19-
<PAGE>

MMA PRAXIS MUTUAL FUNDS
INTERNATIONAL FUND

SCHEDULE OF PORTFOLIO INVESTMENTS
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------- ---------------------------------------------------------- ----------
<C> <S> <C>
COMMON STOCKS (91.4%):
AUSTRALIA (1.6%):
Banking (0.9%):
9,554 Australia & New Zealand Banking Group..................... $ 70,858
----------
Diversified Minerals (0.8%):
9,554 WMC Limited (b)........................................... 59,763
----------
Total Australia 130,621
----------
BRAZIL (1.1%):
Utilities--Telecommunications (1.1%):
600 Telebras ADR (b).......................................... 91,050
----------
Total Brazil 91,050
----------
CANADA (0.6%):
Precious Metals (0.6%):
3,900 Echo Bay Mines Ltd. (b)................................... 22,425
1,500 Placer Dome, Inc.......................................... 24,563
----------
Total Canada 46,988
----------
FRANCE (7.3%):
Automotive Components (0.9%):
1,124 Valeo..................................................... 69,880
----------
Electrical & Machinery (2.0%):
2,937 Schneider S.A. (b)........................................ 156,482
----------
Machinery & Engineering (0.6%):
611 Sidel..................................................... 47,353
----------
Utilities--Water (3.8%):
1,204 CIE Generale Des Eaux (b)................................. 154,424
1,480 Suez-Lyonnaise De Eaux.................................... 149,237
----------
303,661
----------
Total France 577,376
----------
GERMANY (8.6%):
Automotive (3.0%):
315 Volkswagen, 50............................................ 238,980
----------
Banking (1.1%):
1,514 Deutsche Bank............................................. 88,970
----------
Chemicals (2.5%):
4,640 Hoechst AG................................................ 196,780
----------
Machinery & Engineering (2.0%):
352 Mannesmann AG............................................. 157,362
----------
Total Germany 682,092
----------
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------- ---------------------------------------------------------- ----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
HONG KONG (4.1%):
Banking (0.8%):
4,700 Hang Seng Bank (b)........................................ $ 67,036
----------
Real Estate (3.3%):
12,000 Hutchison Whampoa......................................... 103,778
14,000 New World Development Co. Ltd............................. 83,487
6,000 Sun Hung Kai Properties Ltd............................... 72,219
----------
259,484
----------
Total Hong Kong 326,520
----------
ITALY (7.5%):
Automotive (2.3%):
51,122 Fiat SpA (b).............................................. 183,877
----------
Insurance (0.8%):
44,091 Istituto Nazionale Delle Assicurazioni (b)................ 67,115
----------
Rubber & Rubber Products (1.3%):
41,573 Pirelli SpA............................................... 102,864
----------
Utilities--Telecommunications (3.0%):
40,909 Stet Societa Finanziaria Telefonica SpA................... 238,025
----------
Total Italy 591,881
----------
JAPAN (28.2%):
Automotive (1.7%):
17,000 Nissan Motor Co., Ltd. (b)................................ 132,072
----------
Banking (4.1%):
6,000 Mitsubishi Trust & Banking (b)............................ 94,905
8,000 Sumitomo Bank (b)......................................... 131,434
9,000 Sumitomo Trust & Banking (b).............................. 96,740
----------
323,079
----------
Building & Construction (1.0%):
1,000 Daiwa House Industry Co. (b).............................. 12,235
6,000 Obayashi Corp. (b)........................................ 40,217
6,000 Taisei Corp. (b).......................................... 27,842
----------
80,294
----------
Brokerage Services (2.1%):
12,000 Daiwa Securities (b)...................................... 94,800
5,000 Nomura Securities Co. Ltd. (b)............................ 69,038
----------
163,838
----------
</TABLE>

Continued

-20-
<PAGE>

MMA PRAXIS MUTUAL FUNDS
INTERNATIONAL FUND

SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------- ---------------------------------------------------------- ----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Computer Software & Services (2.8%):
3 NTT Data (b).............................................. $ 116,141
1,000 Rohm Co. (b).............................................. 103,120
----------
219,261
----------
Electrical & Electronic (8.7%):
1,400 Kyocera Corp. (b)......................................... 111,334
1,000 Murata Mfg. Co. (b)....................................... 39,850
3,000 NEC (b)................................................... 41,947
4,000 Pioneer Electronic Corp. (b).............................. 97,177
9,000 Sharp Corp. (b)........................................... 124,268
3,100 Sony Corp. (b)............................................ 270,637
----------
685,213
----------
Office Equipment (0.7%):
2,000 Canon Inc................................................. 54,531
----------
Real Estate (1.9%):
17,000 Sumitomo Realty & Development (b)......................... 150,048
----------
Retail (1.7%):
2,000 Ito Yokado Co. (b)........................................ 116,228
2,000 Matsuzakaya (b)........................................... 14,786
----------
131,014
----------
Steel (1.5%):
2,000 Hitachi Metals Ltd. (b)................................... 14,594
22,000 Nippon Steel (b).......................................... 70,366
15,000 NKK Corp. (b)............................................. 32,247
----------
117,207
----------
Utilities--Telecommunications (2.2%):
4 DDI Corp. (b)............................................. 29,573
15 Nippon Telephone & Telegraph (b).......................... 144,193
----------
173,766
----------
Total Japan 2,230,323
----------
MALAYSIA (1.7%):
Diversified (1.7%):
103,000 Renong Berhad (b)......................................... 134,667
----------
Total Malaysia 134,667
----------
</TABLE>
<TABLE>
<CAPTION>
SECURITY MARKET
SHARES DESCRIPTION VALUE
------- ---------------------------------------------------------- ----------
<C> <S> <C>
COMMON STOCKS, CONTINUED:
MEXICO (1.0%):
Utilities--Telecommunications (1.0%):
1,700 Telefonos De Mexico ADR................................... $ 81,175
----------
Total Mexico 81,175
----------
NETHERLANDS (6.1%):
Banking (1.4%):
2,456 Ing Groep N.V............................................. 113,441
----------
Electrical & Electronic (2.0%):
2,190 Philips Electronics (b)................................... 157,153
----------
Publishing (2.7%):
7,601 Verenigde Nederlandse Uitgeversbedrijven.................. 168,366
366 Wolters Kluwer............................................ 44,645
----------
213,011
----------
Total Netherlands 483,605
----------
SINGAPORE (0.6%):
Banking (0.6%):
2,000 Development Bank of Singapore............................. 25,177
2,400 OCBC Foreign.............................................. 24,842
----------
Total Singapore 50,019
----------
SPAIN (3.8%):
Utilities--Electric (2.1%):
1,934 Empresa Nacional De Electricidad,
S.A. (b)................................................. 162,668
----------
Utilities--Telecommunications (1.8%):
4,786 Telefonica De Espana...................................... 138,630
----------
Total Spain 301,298
----------
SWEDEN (2.4%):
Pharmaceuticals (2.4%):
10,326 Astra A Free.............................................. 192,301
----------
Total Sweden 192,301
----------
SWITZERLAND (5.7%):
Chemicals (0.9%):
742 CIBA Specialty Chemicals (b).............................. 68,711
----------
Pharmaceuticals (4.8%):
124 Novartis AG REG........................................... 198,522
20 Roche Holding AG-Genussshein.............................. 181,157
----------
379,679
----------
Total Switzerland 448,390
----------
</TABLE>

Continued

-21-
<PAGE>

MMA PRAXIS MUTUAL FUNDS
INTERNATIONAL FUND

<TABLE>
<S> <C>
Unrealized appreciation. $922,832
Unrealized depreciation. (62,177)
--------
Net unrealized
appreciation............ $860,655
========
</TABLE>

(b) Non-income producing security.

ADR America Depository Receipt
PLC Public Liability Company

See notes to financial statements.

-22-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
(UNAUDITED)

1. ORGANIZATION:

The MMA Praxis Mutual Funds (the "Company") is an open-end management
investment company established as a Delaware business trust under a
Declaration of Trust dated September 27, 1993, and is registered under the
Investment Company Act of 1940, as amended (the "1940 Act"). The Company
currently consists of the Intermediate Income Fund, the Growth Fund, and the
International Fund (individually a "Fund", collectively "the Funds"). The
Intermediate Income Fund and the Growth Fund commenced operations January 4,
1994 and the International Fund commenced operations April 1, 1997. Between
the date of organization and the date of commencement of operations the Funds
had no operations other than those relating to organizational matters,
including the issuance on December 28, 1993 of 5,000 shares of the
Intermediate Income Fund and 5,000 shares of the Growth Fund at $10.00 per
share, also the issuance on April 1, 1997 of 5,000 shares of the
International Fund at $10.00 per share to the Mennonite Mutual Aid
Association.

The investment objective of the Intermediate Income Fund is to seek current
income with capital appreciation as a secondary objective. Under normal
market conditions, this Fund will invest substantially all, but in no event
less than 65% of its total assets in fixed income securities. The investment
objective of the Growth Fund is to seek capital appreciation with current
income as a secondary objective. This Fund invests primarily in undervalued
securities of medium to large capitalization companies. The investment
objective of the International Fund is capital appreciation. Current income
is a secondary objective. This Fund will invest at least 65% of the value of
its total assets in equity securities of foreign companies.

2. SIGNIFICANT ACCOUNTING POLICIES:

The following is a summary of significant accounting policies followed by
the Company in the preparation of its financial statements. The policies are
in conformity with generally accepted accounting principles. The preparation
of financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of income and
expenses for the period. Actual results could differ from those estimates.

SECURITIES VALUATION:

Fund investments in common and preferred stocks, corporate bonds,
commercial paper, municipal bonds, U.S. Government securities and
securities of U.S. Government agencies are valued at their market values
determined on the basis of the latest available bid prices in the principal
market (closing sales prices if the principal market is an exchange) in
which such securities are normally traded. Investments in investment
companies are valued at their respective net asset values as reported by
such companies. The differences between the cost and market values of
investments are reflected as either unrealized appreciation or
depreciation.

SECURITIES TRANSACTIONS AND RELATED INCOME:

Security transactions are accounted for on the date the security is
purchased or sold (trade date). Interest income is recognized on the
accrual basis and includes, where applicable, the pro rata amortization of
premium or accretion of discount. Dividend income is recorded on the ex-
dividend date. Gains or losses

Continued

-23-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

NOTES TO FINANCIAL STATEMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)

realized on sales of securities are determined by comparing the identified
cost of the security lot sold with the net sales proceeds.

FOREIGN CURRENCY TRANSLATION:

The market value of investment securities, other assets and liabilities of
the International Fund denominated in foreign currencies are translated
into U.S. dollars at the current exchange rate at the close of each
business day. Purchases and sales of securities, income receipts and
expense payments are translated into U.S. dollars based at the exchange
rate on the date of the transactions.

The International Fund does not isolate that portion of the results of
operations resulting from changes in foreign exchange rates on investments
from the fluctuations arising from changes in market prices of securities
held. Such fluctuations are included with the net realized and unrealized
gain or loss from investments.

Reported net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, 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 International
Fund's books, and the U.S. dollar equivalent of the amounts actually
received or paid. Net unrealized foreign exchange gains and losses arise
from changes in the value of assets and liabilities including investments
in securities at fiscal year end, resulting from changes in the exchange
rate.

FORWARD FOREIGN CURRENCY CONTRACTS:

The International Fund may enter into forward foreign currency exchange
contracts for the purchase or sale of specific foreign currencies at a
fixed price on a future date. Risks may arise upon entering these contracts
from the potential inability of counterparties to meet the terms of their
contracts and from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar. The International Fund will enter
into forward contracts as a hedge against specific transactions or
portfolio positions to protect against adverse currency movements. The
forward foreign currency exchange contracts are adjusted by the daily
exchange rate of the underlying currency and any gains or losses are
recorded for financial statement purposes as unrealized until the contract
settlement date, at which time the International Fund records a realized
gain or loss equal to the difference between the value of the contract at
the time it was opened and the value at the time it was closed.

REPURCHASE AGREEMENTS:

The Funds may acquire repurchase agreements from member banks of the
Federal Deposit Insurance Corporation and from registered broker-dealers
which the adviser deems creditworthy under guidelines approved by the Board
of Trustees, subject to the seller's agreement to repurchase such
securities at a mutually agreed-upon date and price. The repurchase price
generally equals the price paid by a Fund plus interest negotiated on the
basis of current short-term rates, which may be more or less than the rate
on the underlying portfolio securities. The seller, under a repurchase
agreement, is required to maintain the value of collateral held pursuant to
the agreement at not less than the repurchase price (including accrued
interest). Securities subject to repurchase agreements are held by the
Company's custodian or another qualified custodian or in the Federal
Reserve/Treasury book-entry system.

Continued

-24-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

NOTES TO FINANCIAL STATEMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)

OPTIONS TRANSACTIONS:

When a Fund writes a covered call or put option, an amount equal to the
premium received is included in the Fund's statement of assets and
liabilities as a liability. The amount of the liability is subsequently
marked-to-market to reflect the current market value of the option. If an
option expires on its stipulated expiration date or if the Fund enters
into a closing purchase transaction, a gain or loss is realized. If a
written call option is exercised, a gain or loss is realized for the sale
of the underlying security and the proceeds from the sale are increased by
the premium originally received. If a written put option is exercised, the
cost of the security acquired is decreased by the premium originally
received.

When a Fund purchases a call or put option, an amount equal to the premium
paid is included in the Fund's statement of assets and liabilities as an
investment, and is subsequently marked-to-market to reflect the current
market value of the option. If an option expires on the stipulated
expiration date or if the Fund enters into a closing sale transaction, a
gain or loss is realized. If the Fund exercises a call option, the cost of
the security acquired is increased by the premium paid for the call. If
the Fund exercises a put option, a gain or loss is realized from the sale
of the underlying security, and the proceeds from such sale are decreased
by the premium originally paid. Written and purchased options are non-
income producing securities. The options techniques utilized are to hedge
against fluctuations in the value of securities which the Funds hold or
intend to purchase. As of June 30, 1997 the Funds had no options
outstanding.

DIVIDENDS TO SHAREHOLDERS:

Dividends from net investment income are declared and paid monthly for the
Intermediate Income Fund and declared and paid quarterly for the Growth
Fund. Dividends from net investment income are declared and paid twice a
year for the International Fund. Distributable net realized capital gains,
if any, are declared and distributed at least annually.

Dividends from net investment income and from net realized capital gains
are determined in accordance with income tax regulations which may differ
from generally accepted accounting principles. These differences are
primarily due to differing treatments of mortgage-backed securities,
expiring capital loss carry-forwards and deferrals of certain losses.

FEDERAL INCOME TAXES:

It is the policy of each Fund to continue to qualify as a regulated
investment company by complying with the provisions available to certain
investment companies, as defined in applicable sections of the Internal
Revenue Code, and to make distributions of net investment income and net
realized capital gains sufficient to relieve it from all, or substantially
all, Federal income taxes.

ORGANIZATION COSTS:

Costs incurred by the Company in connection with its organization and
registration of shares have been deferred and are amortized using the
straight-line method over a period of five years from the commencement of
the public offering of shares of the Funds. In the event that any of the
initial shares of the Funds are redeemed during the amortization period by
any holder thereof, the redemption proceeds will be reduced by any

Continued

-25-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

NOTES TO FINANCIAL STATEMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)

unamortized organizational expenses of the Company in the same proportion
as the number of said shares of the Fund being redeemed bears to the
number of initial shares of that Fund that are outstanding at time of
redemption.

OTHER:

Each Fund maintains a cash balance with its custodian and receives a
reduction of their custody fees and expenses for the amounts of interest
earned on such uninvested cash balance. For financial reporting purposes,
for the six months ended June 30, 1997, custodian fees and expenses paid
by third parties were increased by $2,102, $2,945 and $0 for the
Intermediate Income Fund, Growth Fund and International Fund,
respectively. There was no effect on net investment income. The Funds
could have invested such cash amounts in an income producing asset if they
had not agreed to a reduction of fees or expenses under the expense offset
arrangement with their custodian.

Expenses that are directly related to one of the Funds are charged
directly to that Fund. Other operating expenses of the Company are
prorated to the Funds on the basis of relative net assets.

3. PURCHASES AND SALES OF SECURITIES:

Purchases and sales of securities (excluding short-term securities) for the
six months ended June 30, 1997 were as follows:

<TABLE>
<CAPTION>
PURCHASES SALES
----------- -----------
<S> <C> <C>
Intermediate Income Fund......................... $10,905,727 $ 9,820,597
Growth Fund...................................... $35,324,055 $17,053,485
International(a)................................. $ 7,177,720 $ 871,473
</TABLE>
-------
(a) For the period from April 1, 1997 (commencement of operations) through
June 30, 1997.

4. RELATED PARTY TRANSACTIONS:

Menno Insurance Service, Inc. doing business as MMA Capital Management, (the
"Adviser") (a separate corporate entity controlled by Mennonite Mutual Aid,
Inc.), provides investment advisory services to the Company. Under the terms
of the investment advisory agreement, the Adviser is entitled to receive fees
based on a percentage of the average net assets of each of the Funds. Oechsle
International Advisors, L.P., Boston, Massachusetts serves as the sub-adviser
to the International Fund.

BISYS Fund Services Limited Partnership d/b/a BISYS Fund Services ("BISYS"),
an Ohio limited partnership, and BISYS Fund Services Ohio, Inc. ("BISYS
Ohio") are subsidiaries of the BISYS Group, Inc.

BISYS serves the Company as administrator. Under the terms of the management
and administration agreement, BISYS receives fees that are computed daily as
a percentage of the average net assets of each Fund with a minimum of
$50,000 if the net assets are less than $50 million per Fund.

BISYS also serves as Fund distributor. BISYS receives fees for providing
distribution services under the Distribution Service Plan (the "Plan")
pursuant to Rule 12b-1 of the 1940 Act. Under the Plan, each Fund pays BISYS
a fee

Continued

-26-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

NOTES TO FINANCIAL STATEMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)

not to exceed, on an annual basis, 1.00% of the average daily net assets of
each Fund for payments made to banks, broker/dealers and other institutions,
including affiliates of the Adviser, and for expenses BISYS and any of its
affiliates or subsidiaries incur for providing distribution or shareholder
service assistance.

Pursuant to a Shareholder Servicing Agreement, BISYS provides administrative
services to shareholders for which it receives a fee based on a percentage
of the average daily net assets of each fund.

BISYS Ohio serves each Fund as transfer agent and fund accountant. For
transfer agent services, BISYS Ohio is entitled to receive fees based upon
the number of shareholders with specified minimum per fund. For fund
accounting services, BISYS Ohio is entitled to receive fees based on a
percentage of the average daily net assets of each Fund. In addition, BISYS
Ohio is reimbursed for certain out-of-pocket expenses incurred in providing
such transfer agency and fund accounting services.

Certain officers of the Company are affiliated with BISYS and/or MMA Capital
Management, Inc. Such officers are not paid any fees directly by the Funds
for serving as officers of the Company.

Certain redemptions of shares made within 5 years of purchase are subject to
contingent deferred sales charges ("CDSCs"). The applicable CDSC is equal to
a percentage of the lesser of the net asset value per share ("NAV") at the
date of the original purchase or at the date of redemption. The sales charge
will not be imposed on increases above the NAV at the time of purchase or
shares purchased through the reinvestment of dividends from net investment
income or capital gains. For the six months ended June 30, 1997, BISYS
received $23,906 from commissions earned on redemptions of shares of which
BISYS re-allowed $23,906 to affiliated parties of the Funds.

<TABLE>
<CAPTION>
YEAR OF REDEMPTION CDSC
------------------ -----
<S> <C>
First 4.00%
Second 4.00%
Third 3.00%
Fourth 2.00%
Fifth 1.00%
Sixth and up 0.00%
</TABLE>

Fees may be voluntarily reduced or reimbursed to assist the Funds in
maintaining competitive expense ratios.

Continued

-27-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

NOTES TO FINANCIAL STATEMENTS, CONTINUED
JUNE 30, 1997
(UNAUDITED)

Information regarding these transactions are as follows for the six months
ended June 30, 1997:

<TABLE>
<CAPTION>
INTERMEDIATE
INCOME GROWTH INTERNATIONAL
FUND FUND FUND
------------ -------- -------------
<S> <C> <C> <C>
INVESTMENT ADVISORY FEES:
Annual fee before voluntary fee
reductions (percentage of average
net assets)............................ 0.50% 0.74% 0.90%
Voluntary fee reductions................ $ 42,416 $ 594 $ 6,185*
ADMINISTRATION FEES:
Annual fee before voluntary fee
reductions (percentage of average 0.15% or 0.10% 0.15% or
net assets)............................ $50,000 $50,000
Minimum Minimum
Voluntary fee reductions................ -- -- $12,534*
12B-1 FEES:
Annual fee before voluntary fee
reductions (percentage of average
net assets)............................ 1.00% 1.00% 1.00%
Voluntary fee reductions................ $135,784 $220,030 $14,819*
SHAREHOLDER SERVICE FEES:
Annual fee before voluntary fee
reductions (percentage of average
net assets)............................ 0.25% 0.25% 0.25%
Voluntary fee reductions................ $ 32,875 $ 81,742 $ 3,587*
EXPENSES REIMBURSED BY INVESTMENT
ADVISER:................................ -- -- $41,302*
FUND ACCOUNTING AND TRANSFER AGENT
FEES:................................... $ 50,467 $ 92,122 $24,792*
</TABLE>
-------
* For the period from April 1, 1997 (commencement of operations) through
June 30, 1997.

-28-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
INTERMEDIATE INCOME FUND
-------------------------------------------------------
SIX MONTHS YEAR YEAR JANUARY 4,
ENDED ENDED ENDED 1994 TO
JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1997 1996 1995 1994 (A)
----------- ------------ ------------ ------------
(UNAUDITED)
<S> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD..... $ 9.84 $10.17 $ 9.14 $ 10.00
------- ------- ------- -------
Investment Activities
Net investment income.. 0.28 0.54 0.53 0.45
Net realized and
unrealized gains
(losses) from
investments........... (0.07) (0.33) 1.03 (0.86)
------- ------- ------- -------
Total from Investment
Activities.............. 0.21 0.21 1.56 (0.41)
------- ------- ------- -------
Distributions
Net investment income.. (0.26) (0.54) (0.53) (0.45)
------- ------- ------- -------
Total Distributions..... (0.26) (0.54) (0.53) (0.45)
------- ------- ------- -------
NET ASSET VALUE, END OF
PERIOD.................. $ 9.79 $ 9.84 $ 10.17 $ 9.14
======= ======= ======= =======
Total Return (excludes
redemption charge)...... 2.18(b) 2.22% 17.47% (4.09)%(b)
RATIOS/SUPPLEMENTARY
DATA:
Net Assets at end of
period (000).......... $29,701 $27,568 $23,470 $17,849
Ratio of expenses to
average net assets.... 1.10%(c) 1.10% 1.10% 1.10%(c)
Ratio of net investment
income to average net
assets................ 5.75%(c) 5.50% 5.49% 4.96%(c)
Ratio of expenses to
average net assets*... 2.59%(c)** 2.52%** 2.64% 2.83%(c)
Ratio of net investment
income to average net
assets*............... 4.27%(c) 4.15% 3.95% 3.23%(c)
Portfolio Turnover..... 35.38% 30.25% 31.57% 4.95%
</TABLE>
- -------
* During the period certain expenses were voluntarily reduced. If such
voluntary fee reductions had not occurred, the ratios would have been as
indicated.
** During the six months ended June 30, 1997, and the year ended December 31,
1996, the Intermediate Income Fund received credits from its custodian for
interest earned on uninvested cash balances which were used to offset
custodian fees. If such credits had not occurred, the expense ratio would
have been as indicated. The ratio of net investment income was not
affected.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.

See notes to financial statements.

-29-
<PAGE>

MMA PRAXIS MUTUAL FUNDS

FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
GROWTH FUND INTERNATIONAL FUND
------------------------------------------------------- ------------------
SIX MONTHS YEAR YEAR JANUARY 4, APRIL 1, 1997
ENDED ENDED ENDED 1994 TO THROUGH
JUNE 30, DECEMBER 31, DECEMBER 31, DECEMBER 31, JUNE 30,
1997 1996 1995 1994 (A) 1997 (A)
----------- ------------ ------------ ------------ ------------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD............................ $ 13.57 $ 12.07 $ 9.74 $ 10.00 $ 10.00
------- ------- ------- ------- -------
Investment Activities
Net investment income............ 0.02 0.07 0.10 0.09 --
Net realized and unrealized gains
(losses) from investments....... 2.17 1.85 3.12 (0.07) 1.50
------- ------- ------- ------- -------
Total from Investment Activities.. 2.19 1.92 3.22 0.02 1.50
------- ------- ------- ------- -------
Distributions
Net investment income............ (0.03) (0.07) (0.10) (0.09) --
Net realized gains............... -- (0.35) (0.79) (0.19) --
------- ------- ------- ------- -------
Total Distributions............... (0.03) (0.42) (0.89) (0.28) --
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD.... $ 15.73 $ 13.57 $ 12.07 $ 9.74 $ 11.50
======= ======= ======= ======= =======
Total Return (excludes redemption
charge).......................... 16.16%(b) 15.87% 33.32% 0.27%(b) 15.01%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period
(000)........................... $83,346 $58,907 $30,906 $18,009 $ 7,921
Ratio of expenses to average net
assets.......................... 1.72%(c) 1.74% 1.75% 1.75%(c) 2.00%(c)
Ratio of net investment income to
average net assets.............. 0.37%(c) 0.61% 0.90% 1.02%(c) 0.26%(c)
Ratio of expenses to average net
assets*......................... 2.58%(c)** 2.55%** 2.81% 3.25%(c) 7.03%(c)
Ratio of net investment income
(loss) to average net assets*... (0.48)%(c) (0.17)% (0.16)% (0.48)%(c) (4.77)%(c)
Portfolio Turnover............... 26.20% 33.98% 48.91% 35.22% 13.73%
Average commission rate paid (d). $0.1784 $0.1038 -- -- $0.0230
</TABLE>
- -------
* During the period certain expenses were voluntarily reduced and/or
reimbursed. If such voluntary fee reductions and reimbursements had not
occurred, the ratios would have been as indicated.
** During the six months ended June 30, 1997, and the year ended December 31,
1996, the Growth Fund received credits from its custodian for interest
earned on uninvested cash balances which were used to offset custodian
fees. If such credits had not occurred, the expense ratio would have been
as indicated. The ratio of net investment income was not affected.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Represents the total dollar amount of commissions paid on portfolio
transactions divided by total number of shares purchased and sold by the
Fund for which commissions were charged. Not required for prior periods.

See notes to financial statements.

-30-
<PAGE>

Semi-Annual Report

INVESTMENT ADVISER FOR THE SIX MONTHS ENDED JUNE 30, 1997
MMA Capital Management
Post Office Box 483
Goshen, Indiana 46527
MMA
Praxis
Mutual
Funds

INVESTMENT SUB-ADVISER INTERMEDIATE INCOME FUND
(INTERNATIONAL FUND ONLY) GROWTH FUND
Oechsle Internationa Advisers, L.P. INTERNATIONAL FUND
One International Place
Boston, Massachusetts 02110
[LOGO OF M M A]

This report is for the information of
shareholders of MMA Praxis Mutual Funds,
but it may also be used as sales
literature when preceded or accompanied
by the current prospectus, which gives
details about charges, expenses,
investment objectives, and operating
policies of the Funds. Read the
prospectus carefully before investing
or sending money.

ADMINISTRATOR AND DISTRIBUTOR
BISYS Fund Services
3435 Stelzer Road
Columbus, Ohio 43219

LEGAL COUNSEL
Dechert Price & Rhoads
1500 K Street, NW
Washington, DC 20005

AUDITORS
Coopers & Lybrand L.L.P.
100 East Broad Street
Columbus, Ohio 43215

TRANSFER AGENT
BISYS Fund Services Ohio, Inc.
3435 Stelzer Road
Columbus, Ohio 43219

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[LOGO SOY INK]