Dear Shareholders:
--------------------------------------------------------------------------------
The Lexington International Fund climbed 1.2%* during the second quarter.
This compares favorably to the unmanaged Morgan Stanley EAFE Index which rose
0.3% for the same period. The average international fund appreciated 4.0% during
the second quarter according to Lipper Analytical Services, Inc. For the first
six months of 1995, Lexington International Fund returned -2.4%*, while the
unmanaged Morgan Stanley EAFE Index provided a 1.8% return. The average
international fund is up 2.3% for the first six months.
The Lexington International Fund underperformed its peers during the second
quarter due to several factors. Although substantially reduced, the Fund's
holdings of Japanese cyclical shares continued to decline sharply. Technology
stocks were the star performers during the quarter. Electronic component and
instrument stocks were up 23.2%, while data processing stocks returned 12.7%.
The Lexington International Fund held less technology stocks than its peer
group. Finally, the Fund's 20% hedged position on foreign currencies prevented
the Fund from reaping additional benefits from further dollar weakness.
Most international equities performed well during the second quarter due to
the effects of a slowing U.S. economy. Interest rate hikes by the Federal
Reserve finally began to slow the economy as both auto and housing sales
slumped. In fact, the slowdown in the U.S. economy was more pronounced and rapid
than most investors had expected. This led to a powerful global bond rally which
was particularly strong in the U.S. as ten year government bond yields fell
1.05% to 6.25%. European bonds also enjoyed a strong rally while Japanese bond
yields collapsed .85% to just 2.9%. Not surprisingly, equities performed well as
world bond yields fell. The Japanese economy continued to struggle as secular
problems such as a weak banking system and bloated employment levels were
exacerbated by a strong yen. Despite a strong bond market, Japanese stocks fell
6.5%. Both European and emerging markets generally performed well as slower
world growth fueled bonds and stocks.
Looking toward the second half of 1995 we expect the U.S. economy to
strengthen. Lower interest rates should spur renewed interest in housing and
autos. Inventory levels should be at more normal levels and thus prevent a
further drag on the economy. In the short term a strengthening U.S. economy
should weaken international bonds and stocks. European economies will benefit
from a pickup in U.S. economic growth but further restructuring and strong
currencies will keep growth low at under 3%. This should allow the Bundesbank
to cut interest rates which will provide support for European markets. Emerging
markets are at relatively attractive valuations but are vulnerable to a
correction when the U.S. market falls. Japanese stocks remain unattractive long
term until companies get serious about cutting costs in the form of reducing
labor. After a recent visit to Japan we find this unlikely to happen in the
immediate future. Finally, we remain bullish on the dollar, particularly
against the yen. Signs of U.S. economic strength, a further cut in German
interest rates, and a continuing fall in Japan's trade surplus should combine
for a stronger dollar by the end of 1995.
The Lexington International Fund will probably not see dramatic changes in
country weighting in the second half of 1995. As U.S. economic acceleration
becomes evident a reduction of interest sensitive stocks is likely, particularly
in Hong Kong. Underperforming markets such as South Korea are looking more
attractive and would benefit from a pick-up in U.S. and world growth. European
markets remain attractive with our focus on countries likely to enjoy interest
rate cuts. Political changes in Spain may also provide opportunities in the
months ahead. We believe it will be a stock picker's market and the focus will
be on individual stocks. We will continue to look for quality managements which
have an ability to grow a business. Stock selection will continue to be based on
a long term view of a company's prospects and applying our valuation criteria.
The Fund will continue to hedge a portion of the portfolio back into dollars as
we expect a strong U.S. currency.
Also included in this semi-annual report to shareholders is a summary of the
results of the shareholder meeting held on April 19, 1995. All of the proposals
were approved by a majority of shareholders.
1
<PAGE>
We appreciate your continued support and would welcome the opportunity to
discuss any questions you may have about your investment.
Sincerely,
Richard T. Saler Robert M. DeMichele
Portfolio Manager President
July, 1995 July, 1995
*-3.08% and 2.20% are the one year and since commencement (1/3/94) average
annual standard total returns, respectively, for the period ended June 30,
1995. Investment return and principal value of an investment will fluctuate so
that an investor's shares, when redeemed, may be worth more or less than at
their original cost. Total return represents past performance.
Results of Annual Meeting of Shareholders held April 19, 1995
Total Outstanding Shares as of February 1, 1995: 1,703,149
<TABLE>
1. Directors Elected: Robert M. DeMichele, Beverley C. Duer, Barbara R. Evans, Lawrence Kantor, Donald B.
Miller, Francis Olmsted, John G. Preston, Margaret W. Russell, Philip C. Smith and Francis A. Sunderland
<CAPTION>
Votes Votes
Votes For Against Abstained
--------- ------- ---------
<S> <C> <C> <C>
2. Selection of KPMG Peat Marwick LLP as Independent Auditors 1,637,607 1,772 1,202
3. Amendment to fundamental restriction concerning senior
securities 1,567,738 4,192 1,492
4. Amendment to fundamental restriction concerning borrowing 1,566,573 5,465 1,385
5. Elimination of fundamental restriction concerning its ability to
pledge, mortgage or hypothecate 1,565,603 6,430 1,388
6. Amendment to fundamental restriction concerning underwriting 1,566,881 5,049 1,492
7. Amendment to fundamental restriction concerning real estate 1,566,169 5,957 1,295
8. Amendment to fundamental restriction concerning lending 1,566,136 5,793 1,492
9. Elimination of fundamental restriction concerning joint trading
accounts 1,568,806 3,030 1,585
10. Amendment to fundamental restriction concerning commodities 1,565,950 5,980 1,492
11. Elimination of fundamental restriction concerning margin and
short sales 1,565,341 6,595 1,486
12. Amendment to fundamental restriction concerning concentration 1,567,164 4,766 1,492
13. Separation of fundamental restriction concerning diversification
and securities of affiliates 1,566,986 4,951 1,486
14. Elimination of fundamental restriction concerning securities of
other investment companies 1,567,223 4,904 1,295
15. Elimination of fundamental restriction concerning securities of
issuers in operation less than three (3) years 1,567,574 4,356 1,492
16. Elimination of fundamental restriction concerning investment for
control 1,565,477 6,559 1,384
17. Elimination of fundamental restriction concerning warrants 1,565,818 5,739 1,865
18. Elimination of fundamental restriction concerning restricted and
illiquid securities 1,564,880 6,874 1,668
19. Elimination of fundamental restriction concerning investment in
oil, gas and minerals 1,567,339 4,508 1,575
</TABLE>
2
<PAGE>
Lexington International Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited)
(Left Column)
Number of Value
Shares Security (Note 1)
----------------------------------------------------------------
Australia: 4.0%
28,000 Mayne Nickless Ltd. .............. $ 115,121
76,400 TABcorp Holdings Ltd. ............ 157,873
14,000 TABcorp Holdings Ltd. (ADR)1 ..... 287,000
30,100 QBE Insurance Group Ltd. ......... 119,695
----------
679,689
----------
Belgium: 1.1%
2,800 NV Union Miniere S.A. ............ 183,335
----------
Canada: 2.6%
17,900 Canadian Pacific, Ltd. ........... 308,115
3,600 Jetform Corporation .............. 59,175
60,200 Markborough Properties Inc.* ..... 82,899
----------
450,189
----------
Chile: 1.2%
15,000 Banco Osorno y La Union (ADR) .... 208,125
----------
Denmark: 1.7%
2,670 Novo-Nordisk A.S. ................ 283,143
----------
Finland: 1.6%
8,100 Huhtamaki Group "I" .............. 265,836
----------
France: 7.8%
3,580 Banque Nationale de Paris ........ 172,975
1,327 Cetelem .......................... 205,502
700 Comptoirs Modernes ............... 216,085
14,100 France Growth Fund, Inc. ......... 144,525
320 Groupe Danone .................... 53,916
1,300 Ecco S.A. ........................ 204,275
70 Grand Optical Photoservice ....... 6,475
1,730 Havas ............................ 137,172
1,800 Seb SA ........................... 200,330
----------
1,341,255
----------
Germany: 6.0%
250 AVA Allegmeine Handelsgelesschaft
der Verbraucher AG ............. 97,705
1,820 Continental AG ................... 264,497
1,800 Deutsche Bank AG ................. 87,545
330 Douglas Holdings AG .............. 124,219
257 Fag Kugelfischer Georg Schaefer
Kommanditgesellschaft Auf Aktien* 35,061
230 Moebel Walther AG ................ 116,523
1,520 Pfaff GM AG ...................... 170,515
216 Sto AG ........................... 135,694
----------
1,031,759
----------
(Right Column)
Number of Value
Shares Security (Note 1)
----------------------------------------------------------------
Hong Kong: 9.4%
73,000 Dao Heng Bank Group Ltd. ......... $ 222,670
19,200 HSBC Holdings Plc ................ 246,297
19,000 Johnson Electric Holdings Ltd. ... 38,310
193,000 Peregrine Investment Holdings Ltd. 274,395
127,000 Semi-Tech (Global) Ltd. .......... 204,363
217,000 Shun Tak Holdings Ltd. ........... 172,489
34,000 Sun Hung Kai Properties Ltd. ..... 251,584
59,000 Wharf (Holdings) Ltd. ............ 192,548
----------
1,602,656
----------
Indonesia: 1.6%
72,000 PT Argha Karya Prima Industries .. 53,370
37,000 PT Astra International ........... 65,655
26,000 PT Bank International Indonesia .. 80,300
33,000 PT Kawasan Industri Jababeka ..... 65,230
----------
264,555
----------
Ireland: 2.7%
40,000 Allied Irish Banks Plc ........... 190,158
321,100 Waterford Wedgewood Plc .......... 273,718
----------
463,876
----------
Israel: 3.3%
120 Africa-Israel Investments Ltd.* .. 143,797
20,220 Clal Industries Ltd.* ............ 120,237
8,800 First Israel Fund, Inc.* ......... 104,500
2,340 Koor Industries Ltd. ............. 199,737
----------
568,271
----------
Japan: 20.1%
4,000 Acom Company, Ltd. ............... 115,770
34,000 Japan Vilene Company, Ltd. ....... 198,818
20,000 Joshin Denki Company, Ltd. ....... 229,178
18,000 Komatsu ForkLift Company, Ltd. ... 99,940
19,000 Makino Milling Machine
Company, Ltd.* ................. 110,432
10,000 Matsushita Electric Industrial
Company, Ltd. .................. 155,937
15,000 Matsushita Refrigeration Company,
Ltd. ........................... 105,788
10,000 Matsuzakaya Company, Ltd. ........ 101,595
14,000 Mitsubishi Estate Company, Ltd.* . 157,945
8,000 Mori Seiki Company, Ltd. ......... 142,705
20,000 NEC Corporation .................. 219,492
33,000 Nippon Chemi-Con Corporation* .... 180,496
4,000 Nissen Company, Ltd. ............. 120,497
21,000 NOK Corporation .................. 145,126
9,000 NTN Corporation .................. 53,160
3
<PAGE>
Lexington International Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited) (continued)
(Left Column)
Number of Value
Shares Security (Note 1)
----------------------------------------------------------------
Japan (continued)
14,000 Okasan Securities Company, Ltd. .. $ 53,917
3,000 Rohm Company, Ltd. ............... 155,228
8,000 Royal Company, Ltd. .............. 111,518
29,000 Sansui Electric Company, Ltd. .... 62,694
6,000 Shinobu Foods Product Company,Ltd. 57,058
6,300 Sony Corporation ................. 302,907
9,000 Sumitomo Trust & Banking Company,
Ltd. ........................... 109,509
5,000 Tokyo Electron, Ltd. ............. 171,293
12,000 Wacoal Corporation ............... 148,848
16,000 Yarnato Kogyo Company, Ltd. ...... 125,695
----------
3,435,546
----------
Malaysia: 1.7%
27,000 Commerce Asset Holdings, Bhd ..... 138,489
44,000 Land & General Holdings, Bhd ..... 147,149
----------
285,638
----------
Mexico: 0.6%
20,900 Tubos de Acero de Mexico, S.A.(ADR)* 103,194
----------
Netherlands: 4.9%
22,600 Elsevier N.V. .................... 267,170
2,340 Royal Dutch Petroleum Company .... 286,000
2,200 Unilever N.V. .................... 286,512
----------
839,682
----------
New Zealand: 5.1%
375,100 Brierley Investments Ltd. ........ 283,140
30,900 Ceramco Corporation .............. 52,635
111,100 Fisher & Paykel Industries Ltd. .. 326,545
68,900 Independent Newspaper Ltd. ....... 214,018
----------
876,338
----------
Norway: 2.5%
6,800 Petroleum Geo-Services A.S. (ADR)* 196,775
16,200 Saga Petroleum A.S. .............. 230,218
----------
426,993
----------
Philippines: 1.9%
357,500 Filinvest Land Inc.* ............. 103,785
82,500 Philippino Telephone ............. 64,732
310,800 Universal Robina Corporation ..... 158,509
----------
327,026
----------
(Right Column)
Number of Value
Shares Security (Note 1)
----------------------------------------------------------------
Portugal: 1.0%
9,300 Portugal Telecom S.A.* ..... $ 178,235
----------
Singapore: 2.5%
103,000 Comfort Group Ltd.* .............. 81,131
11,000 Fraser & Neave Ltd. .............. 126,818
23,000 United Overseas Bank Ltd.* ....... 217,400
----------
425,349
----------
South Africa: 1.0%
5,700 Rustenberg Platinum Holdings
Ltd. (ADR) ..................... 117,565
4,500 Samancor Ltd. (ADR) .............. 58,782
----------
176,347
----------
Spain: 2.8%
3,260 Corporacion Mapfre ............... 160,505
254 Mapfre Vida Seguros .............. 12,505
9,400 Repsol S.A. ...................... 296,351
----------
469,361
----------
Switzerland: 3.3%
170 Nestle S.A. ...................... 177,289
210 Union Bank of Switzerland ........ 217,910
280 Winterthur Schweizerische
Versicherungs-Gesellschaft ....... 168,530
----------
563,729
----------
United Kingdom: 7.6%
28,300 Aegis Group Plc* ................. 12,739
35,358 Antofagasta Holdings Plc ......... 181,988
37,400 B.A.T. Industries Plc ............ 286,662
27,400 D.F.S. Furniture Company Plc ..... 131,858
11,860 RTZ Corporation Plc .............. 154,972
61,540 Takare Plc ....................... 188,283
97,300 Tomkins Plc ...................... 348,856
----------
1,305,358
----------
TOTAL INVESTMENTS: 98.0%
(cost $16,219,992(D)) (Note 1) . 16,755,485
Other assets in excess
of liabilities: 2.0% ........... 343,853
----------
TOTAL NET ASSETS: 100%
(equivalent to $10.12 per share on
1,689,239 shares outstanding) .. $17,099,338
===========
4
<PAGE>
Lexington International Fund, Inc.
Statement of Net Assets
(Including the Portfolio of Investments)
June 30, 1995 (unaudited) (continued)
At June 30, 1995, the composition of the Fund's net assets by industry
concentration was as follows:
(Left Column)
Banking 11.1%
Capital Equipment ........ 7.4%
Consumer Durable ......... 12.2%
Consumer Nondurable ..... 10.9%
Electric & Electronics ... 1.5%
Energy Sources .......... 5.9%
(Center Column)
Financial Services ...... 6.5%
Health Care .............. 1.7%
Materials ................ 6.0%
Merchandising ............ 4.7%
Multi-Industry ........... 12.0%
Real Estate .............. 3.9%
Services ................. 11.8%
(Right Column)
Telecommunications ....... 1.4%
Transportation ........... 1.0%
Other assets in excess
of liabilities ......... 2.0%
-----
Total Net Assets 100.0%
=====
ADR-American Depository Receipt.
*Non-income producing securities.
1Restricted security.
(D)Aggregate cost for Federal income tax purposes is identical.
The Notes to Financial Statements are an integral part of this statement.
Lexington International Fund, Inc.
Statement of Assets and Liabilities
June 30, 1995 (unaudited)
Assets
<TABLE>
<S> <C>
Investments in securities, at value (cost $16,219,992) (Note 1) .......................... $16,755,485
Cash ..................................................................................... 291,927
Receivable for investment securities sold ................................................ 198,599
Receivable for shares sold ............................................................... 6,477
Dividends and interest receivable ........................................................ 28,774
Foreign taxes recoverable ................................................................ 24,580
Deferred organization expenses (Note 1) .................................................. 33,665
Total Assets .................................................................... 17,339,507
-----------
Liabilities
Due to Lexington Management Corporation (Note 2) ......................................... 15,199
Payable for investment securities purchased .............................................. 147,848
Accrued expenses ......................................................................... 52,384
Unrealized loss on open forward contracts (Note 7) ....................................... 24,738
-----------
Total Liabilities ............................................................... 240,169
-----------
Net Assets (equivalent to $10.12 per share on 1,689,239 shares outstanding) (Note 4) ..... $17,099,338
===========
Net Assets consist of:
Capital stock-authorized 1,000,000,000 shares,
$.001 par value per share .............................................................. $ 1,689
Additional paid-in capital ............................................................... 17,187,918
Accumulated deficit ...................................................................... (26,747)
Accumulated net realized loss on investments and foreign currency holdings ............... (576,656)
Net unrealized appreciation of investments and foreign currency holdings ................. 513,134
-----------
$17,099,338
===========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
5
<PAGE>
Lexington International Fund, Inc.
Statement of Operations
Six months ended June 30, 1995 (unaudited)
Investment Income
Dividends ................................ $ 186,028
Interest ................................. 56,929
---------
242,957
Less: foreign tax expense ................ 33,704
---------
Investment income ............... 209,253
---------
Expenses
Investment advisory fee (Note 2) ......... 85,662
Accounting and shareholder services
expenses (Note 2) ...................... 13,996
Custodian and transfer agent expenses .... 49,226
Printing and mailing ..................... 18,906
Directors' fees and expenses ............. 6,474
Audit and legal .......................... 13,370
Registration fees ........................ 15,586
Distribution expenses (Note 3) ........... 18,964
Computer expense ......................... 3,868
Other expenses ........................... 2,538
Amortization of deferred organization
expenses (Note 1) ...................... 7,410
---------
Total expenses ......................... 236,000
---------
Net investment loss ............. (26,747)
Realized and Unrealized Gain (Loss) on Investments (Note 5)
Realized loss on investments and foreign currency
transactions (excluding short-term securities):
Proceeds from sales ................ 8,929,187
Cost of securities sold ............ 9,167,800
---------
Net realized loss (238,613)
Unrealized appreciation of investments
and foreign currency holdings:
End of period ........................ 513,134
Beginning of period .................. 661,621
---------
Change during period ............... (148,487)
---------
Net realized and unrealized loss
on investments and foreign
currency holdings .............. (387,100)
---------
Decrease in Net Assets Resulting
from Operations ...................... $(413,847)
=========
The Notes to Financial Statements are an integral part of this statement.
6
<PAGE>
Lexington International Fund, Inc.
Statements of Changes in Net Assets
Six months Year
ended ended
June 30, 1995 December 31,
(unaudited) 1994
------------- ------------
Net investment loss ..................... $(26,747) $(142,947)
Net realized gain (loss) from
investments and foreign currency
transactions .......................... (238,613) 168,702
Increase (decrease) in unrealized
appreciation of investments and
foreign currency holdings ............. (148,487) 661,621
----------- -----------
Net increase (decrease) in
net assets resulting
from operations ................ (413,847) 687,376
Distribution to shareholders from
net realized gains from
security transactions (Note 1) ........ - (168,702)
Distributions to shareholders in
excess of net realized gains from
security transactions (Note 1) ........ - (195,096)
Increase (decrease) in net assets from
capital share transactions
(Note 4) .............................. (330,172) 17,519,779
----------- -----------
Net increase (decrease) in
net assets ..................... (744,019) 17,843,357
Net Assets:
Beginning of period ................... 17,843,357 -
----------- -----------
End of period (including accumulated
deficit of $26,747 and $0,
respectively) (Note 1) .............. $17,099,338 $17,843,357
=========== ===========
The Notes to Financial Statements are an integral part of these statements.
7
<PAGE>
Lexington International Fund, Inc.
Notes to Financial Statements
June 30, 1995 (unaudited) and December 31, 1994
1. Significant Accounting Policies
Lexington International Fund, Inc. (the "Fund") is an open end diversified
management investment company registered under the Investment Company Act of
1940, as amended. The Fund commenced operations on January 3, 1994. The
following is a summary of significant accounting policies followed by the Fund
in the preparation of its financial statements:
Investments Security transactions are accounted for on a trade date basis.
Realized gains and losses from security transactions are reported on the
identified cost basis. Investments are stated at market value based on closing
prices reported by the exchange on which the securities are traded on the last
business day of the period or, for over-the-counter securities, at the average
between bid and asked prices, except for short-term securities which are stated
at amortized cost, which approximates market value. Securities for which market
quotations are not readily available and other assets are valued at fair value
as determined by management and approved in good faith by the Board of
Directors. All investments quoted in foreign currencies are valued in U.S.
dollars on the basis of the foreign currency exchange rates prevailing at the
close of business. Dividends and distributions to shareholders are recorded on
the ex-dividend date. Interest income is accrued as earned.
Foreign Currency Transactions Foreign currencies (and receivables and
payables denominated in foreign currencies) are translated into U.S. dollar
amounts at current exchange rates. Translation gains or losses resulting from
changes in exchange rates and realized gains and losses on the settlement of
foreign currency transactions are reported in the statement of operations. In
addition, the Fund may enter into forward foreign exchange contracts in order to
hedge against foreign currency risk in the purchase or sale of securities
denominated in foreign currency. The Fund may also enter into such contracts to
hedge against changes in foreign currency exchange rates on portfolio positions.
These contracts are marked to market daily, by recognizing the difference
between the contract exchange rate and the current market rate as unrealized
gains or losses. Realized gains or losses are recognized when contracts are
settled and are reported in the statement of operations.
Distributions In accordance with Statement of Position 93-2: Determination,
Disclosure and Financial Statement Presentation of Income, Capital Gain and
Return of Capital Distributions by Investment Companies, as of December 31,
1994, book and tax basis differences amounting to $142,947 have been
reclassified from undistributed net investment income to distributions in excess
of net realized gains on investments. Distributions in excess of net realized
gains reflect temporary book-tax differences arising from losses resulting from
wash sales and Internal Revenue Code ("IRC") Excise Tax distribution
requirements and associated post-October loss deferral provisions, which
effectively allow the deferral of net realized capital losses to the next tax
year.
Federal Income Taxes It is the Fund's intention 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 provision for Federal income taxes has been made.
Deferred Organization Expenses Organization expenses aggregating $48,067
have been deferred and are being amortized on a straight-line basis over five
years.
8
<PAGE>
Lexington International Fund, Inc.
Notes to Financial Statements
June 30, 1995 (unaudited) and December 31, 1994 (continued)
2. Investment Advisory Fee and Other Transactions with Affiliate
The Fund pays an investment advisory fee to Lexington Management Corporation
("LMC") at the rate of 1% of average daily net assets. The investment advisory
contract provides that the total annual expenses of the Fund (including
management fees, but excluding interest, taxes, brokerage commissions and
extraordinary expenses) will not exceed the level of expenses which the Fund is
permitted to bear under the most restrictive expense limitation imposed by any
state in which shares of the Fund are offered for sale. No reimbursement was
required for the six months ended June 30, 1995.
The Fund also reimburses LMC for certain expenses, including accounting and
shareholder servicing costs, which are incurred by the Fund, but paid by LMC.
3. Distribution Plan
The Fund has a Distribution Plan (the "Plan") which allows payments to finance
activities associated with the distribution of the Fund's shares. The Plan
provides that the Fund may pay distribution fees on a reimbursement basis,
including payments to Lexington Fund Distributors, Inc. ("LFD"), the Fund's
distributor, in amounts not exceeding .25% per annum of the Fund's average daily
net assets. Total distribution expenses for the six months ended June 30, 1995
were $18,964 and are set forth in the statement of operations.
4. Capital Stock
Transactions in capital stock were as follows:
<TABLE>
<CAPTION>
Six months ended
June 30, 1995 Year ended
(unaudited) December 31, 1994
---------------------- -------------------------
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
Shares sold ....................... 102,753 $1,028,619 2,131,458 $21,962,295
Shares issued to shareholders on
reinvestment of dividends ....... - - 34,849 360,333
-------- ---------- -------- ----------
102,753 1,028,619 2,166,307 22,322,628
Shares redeemed ................... (134,734) (1,358,791) (445,087) (4,802,849)
-------- ---------- -------- ----------
Net increase (decrease) ........... (31,981) $(330,172) 1,721,220 $17,519,779
======= ========= ========= ===========
</TABLE>
5. Purchases and Sales of Investment Securities
The cost of purchases and proceeds from sales of securities for the six months
ended June 30, 1995, excluding short term securities, were $10,419,786 and
$8,929,187, respectively.
At June 30, 1995, aggregate gross unrealized appreciation for all securities and
foreign currency holdings (including foreign currency receivables and payables)
in which there is an excess of value over tax cost amounted to $1,258,351 and
aggregate gross unrealized depreciation for all securities and foreign currency
holdings in which there is an excess of tax cost over value amounted to
$745,217.
9
<PAGE>
Lexington International Fund, Inc.
Notes to Financial Statements
June 30, 1995 (unaudited) and December 31, 1994 (continued)
6. Investment Risks
The Fund's investments in foreign securities may involve risks not present in
domestic investments. Since foreign securities may be denominated in a foreign
currency and involve settlement and pay interest or dividends in foreign
currencies, changes in the relationship of these foreign currencies to the U.S.
dollar can significantly affect the value of the investments and earnings of the
Fund. Foreign investments may also subject the Fund to foreign government
exchange restrictions, expropriation, taxation or other political, social or
economic developments, all of which could affect the market and/or credit risk
of the investments.
In addition to the risks described above, risks may arise from forward foreign
currency contracts as the result of the potential inability of counterparties to
meet the terms of their contracts.
7. Forward Foreign Exchange Contracts
At June 30, 1995, the Fund was committed to sell foreign currencies under the
following forward foreign exchange contracts:
<TABLE>
<CAPTION>
Unrealized
Settlement Contract Contract Current Gain (Loss) at
Currency Date Amount Rate Rate June 30, 1995
-------- ---------- --------- -------- ------- -------------
<S> <C> <C> <C> <C> <C>
Swiss Francs ............... 10/19/95 $ 175,223 1.12 1.14 $ 3,488
German Deutschemark ........ 10/18/95 345,800 1.39 1.38 (3,165)
German Deutschemark ........ 10/19/95 172,877 1.38 1.38 (364)
German Deutschemark ........ 10/19/95 350,446 1.36 1.38 3,997
Danish Krone ............... 10/19/95 175,223 5.42 5.41 (327)
French Francs .............. 10/19/95 350,446 4.89 4.86 (2,238)
French Francs .............. 11/15/95 360,714 5.05 4.86 (14,622)
French Francs .............. 11/24/95 324,952 5.15 4.86 (19,590)
Japanese Yen ............... 10/11/95 868,294 82.04 83.53 15,519
Japanese Yen ............... 11/15/95 901,786 83.73 83.13 (6,516)
Netherland Guilder ......... 10/19/95 345,754 1.55 1.54 (920)
---------- --------
$4,371,515 $(24,738)
========== ========
</TABLE>
10
<PAGE>
Lexington International Fund, Inc.
Financial Highlights
Selected per share data for a share outstanding throughout the period:
Six months Year
ended ended
June 30, 1995 December 31,
(unaudited) 1994
----------- ------
Net asset value, beginning of period .................. $10.37 $10.00
------ ------
Income (loss) from investment operations:
Net investment loss ................................. (.02) (.08)
Net realized and unrealized gain (loss)
on investments .................................... (.23) .67
------ ------
Total income (loss) from investment operations ...... (.25) .59
------ ------
Less distributions:
Distributions from net realized capital gains ....... - (.10)
Distributions in excess of net realized capital gains
(Temporary book-tax difference) ................... - (.12)
------ ------
Total distributions ................................. - (.22)
------ ------
Net asset value, end of period ........................ $10.12 $10.37
====== ======
Total return .......................................... (4.78%)* 5.87%
Ratio to average net assets:
Expenses ............................................ 2.75%* 2.39%
Net investment loss ................................. (.31%)* (.94%)
Portfolio turnover .................................... 102.48%* 100.10%
Net assets at end of period (000's omitted) ...........$17,099 $17,843
*Annualized
11
<PAGE>
(Left Column)
Lexington
International Fund, Inc.
Investment Adviser
--------------------------------------------------------
LEXINGTON MANAGEMENT CORPORATION
P.O. Box 1515
Park 80 West Plaza Two
Saddle Brook, New Jersey 07663
Distributor
--------------------------------------------------------
LEXINGTON FUNDS DISTRIBUTOR, INC.
P.O. Box 1515
Park 80 West Plaza Two
Saddle Brook, New Jersey 07663
------------------------------------------
All shareholder requests for services of
any kind should be sent to:
Transfer Agent
----------------------------------------
STATE STREET BANK AND
TRUST COMPANY
c/o National Financial Data Services
1004 Baltimore
Kansas City, Missouri 64105
Or call toll free:
Service and Sales: 1-800-526-0056
24 Hour Account Information:
1-800-526-0052
------------------------------------------
--------------------------------------------------------
(800) 526-0052
"LEXLINE"
24 hour toll-free telephone access to your
Lexington Fund account
Price/Yield * Account Balances * Exchanges *
Last Transactions * Total Return * Duplicate Statements
--------------------------------------------------------
This report has been prepared for the information of the
shareholders of Lexington International Fund, Inc.
and is authorized for distribution to the public only if
it is accompanied or preceded by a currently effective
prospectus which sets forth expenses and other
material information.
(Right Column)
-------------------------------------
LEXINGTON
-------------------------------------
-------------------------------------
LEXINGTON
INTERNATIONAL
FUND, INC.
(filled box)
Seeks long-term growth of capital,
primarily through investment in
common stocks of companies
domiciled in foreign countries.
(filled box)
SEMI-ANNUAL REPORT
JUNE 30, 1995
The Lexington Group
of No Load
Investment Companies
-------------------------------------
