ADVANTUS CORNERSTONE FUND INC, N-30D, 1999-06-01

ADVANTUS CORNERSTONE FUND INC
N-30D, 1999-06-01

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<PAGE>

CORNERSTONE

ADVANTUS CORNERSTONE FUND, INC.
SEMI-ANNUAL REPORT TO SHAREHOLDERS DATED MARCH 31, 1999

[LOGO]
ADVANTUS-TM-
FAMILY OF FUNDS

EQUITY

[GRAPHIC]

<PAGE>
ADVANTUS CORNERSTONE FUND

TABLE OF CONTENTS

PERFORMANCE UPDATE 2

INVESTMENTS IN SECURITIES 7

STATEMENT OF ASSETS AND LIABILITIES 10

STATEMENT OF OPERATIONS 11

STATEMENTS OF CHANGES IN NET ASSETS 12

NOTES TO FINANCIAL STATEMENTS 13

SHAREHOLDER SERVICES 18
<PAGE>
LETTER FROM THE PRESIDENT [PHOTO]

Dear Shareholders:

U.S. economic expansion, in its longevity and in vigor, is the envy of the rest
of the world. While growth in Europe and the United Kingdom is falling, we are
finally seeing some small improvements in Asia's economic angst; it also appears
that Japan's economic free fall has stopped. However, a working plan for a
sustainable recovery in Japan is still forthcoming. As you can see, growth
patterns around the globe are mixed, but overall, world growth is forecasted to
decline by about one percent over the course of 1999. (World growth is
forecasted to be two percent in 1999.)

In this six-month reporting period, U.S. Gross domestic Product (GDP) in the
fourth quarter 1998 was 6.0 percent. This phenomenal result was fueled by strong
consumer demand and spending. GDP figures for the first quarter 1999 are
estimated at a respectable 4 percent. This economic growth was very broad based,
despite some export difficulties. Above-trend growth is expected for the
remainder of the year.

Will inflation spoil the party? It's unlikely. Weak commodity prices coupled
with excess global capital and labor has created an inflation-benign
environment. The inflation outlook in the U.S. continues to be positive, as
well.

The strong momentum in top-tier large cap growth stocks continues to drive the
equity market. Some trends have continued, such as large cap stocks
outperforming small caps and growth stocks outperforming value stocks. The
breadth of leadership of the equity market has continued to narrow, with only
26.3 percent of the issues in the S&P 500* able to outperform their index over
the last twelve months. The average equity mutual fund has lagged the market
unless it has been overweighted in growth and technology investments. Valuations
in the marketplace continue to be high, particularly in the large cap growth
weighted indices.

Stronger economic growth increased investors' comfort with corporate bonds and
thus the spread to Treasury bonds narrowed. In the fixed-income market,
mortgage-backed securities were the star performers this period, followed by
corporate bonds, and then Treasuries.

The economic and market outlook for the U.S. remains strong. Looking ahead, we
are cautiously optimistic for stock and bond prices, but valuations for
large-cap growth issues are high. Economic growth is forecasted, albeit slower
than in the past. With much of the world still in recession, commodity prices
low, and rapid increases in technology and productivity, high inflation is
unlikely. The Federal Reserve and other central banks stand ready to intervene
if necessary. We are watchful of Y2K issues. Certain countries that are mired in
prolonged recessions lack the money to solve these technology-related problems.

We are - along with the rest of the world - watching the political strife in the
Balkans. The military action in Kosovo has commanded world attention. Escalation
will prove costly in money and human resources.

In the pages that follow, the Fund's manager will update you on how the economy
and the market affected the Fund during this reporting period. The manager will
discuss the Fund's performance and some strategies used to maximize performance.

As always, we thank you for investing with Advantus. We encourage you to
maintain a long-range view of investing; we believe you will derive the greatest
benefit by doing so.

Sincerely,

/s/ William N. Westhoff

William N. Westhoff, President
Advantus Funds

*The S&P 500 is a broad, unmanaged index of 500 common stocks which are
representative of the U.S. stock market overall.
<PAGE>
ADVANTUS CORNERSTONE FUND
PERFORMANCE UPDATE

[PHOTO]
GARY ASTER
PORTFOLIO MANAGER
The Advantus Cornerstone Fund
is a mutual fund designed for
investors seeking long-term
accumulation of capital. In
pursuit of this objective,
the Fund will invest
primarily in equity
securities of mid and large
capitalization companies
(i.e., companies with a
market capitalization of at
least $1.5 billion) at the
time of purchase. In
selecting equity securities,
the Fund invests in
securities that the
investment adviser believes
are undervalued relative to
other securities, earn low
returns with a potential for
higher returns or are
undervalued relative to their
potential for improved
operating performance and
financial strength.
- Dividends paid quarterly.
- Capital gains distributions paid annually.

PERFORMANCE

The Cornerstone Fund's performance for the six-month period ended March 31, 1999
for each class of shares offered is as follows:

<TABLE>
<S> <C>
Class A.......................... 10.28 percent*
Class B.......................... 9.76 percent*
Class C.......................... 9.84 percent*
</TABLE>

The Fund's benchmark, the Russell 1000 Value Index,** earned 18.28 percent for
the same period.

PERFORMANCE ANALYSIS

After outperforming its benchmark in October 1998, the Advantus Cornerstone Fund
has trailed its benchmark index for much of this reporting period. Analysis of
the data reveals that the contrarian style of investing remains out of favor. In
fact, companies with no earnings or negative earnings generated the highest
returns in the Russell 1000 Value Index** by a wide margin and contributed more
than 80 percent to the Index's total return. A similar pattern is found when we
examine returns based on price-to-book value. We believe this data reflects the
desire by some investors for earnings momentum, regardless of traditional
business valuation measures. While the Fund has some exposure to the
low-earning, rapid-growth arena, it is under-weighted relative to the Index. On
a similar note, companies with the largest market capitalizations delivered
greater returns than their mid-sized counterparts, reflecting a continuing
desire for liquidity.

The long-term trend of growth stocks outperforming value stocks continues.
During the first quarter of 1999, growth stocks outperformed their value
counterparts by margins approaching the widest in history. This scenario existed
not only in the broader markets, but also within certain style segments. The
fastest growing third of the Russell 1000 Value Index** generated returns
greater than the total Index return; the remaining two-thirds of the stocks in
the Index earned negative returns.

During this reporting period, the Basic Materials, Consumer Staples and
Energy-related economic sectors provided the best relative performance for the
Fund. The Financial sector represented the entire performance deficit in the
fourth quarter of 1998 - hence, our considerable under-weighting in banks, which
we have maintained throughout this reporting period. We believed the banking
industry, as well as much of the Financial sector, was fully valued and would
soon experience over capacity.

2
<PAGE>
Consumer Staples and Capital Goods fell in and out of favor during the period,
shining in the fourth quarter of 1998 and lackluster in the first quarter of
1999. In these sectors, several companies reported lower-than expected quarterly
earnings; in addition, their stock prices underwent severe selling pressure.
While many of the Fund's holdings were either increased or decreased during the
period, there were no significant positions eliminated or added.

OUTLOOK

The Fund is likely to experience changes over time, but we are currently
satisfied with the Fund's composition. We continue to diligently search for
companies that meet our investing criteria, and we will not hesitate to add
positions that appear to have greater potential than our existing holdings.

While it may be tempting to participate in current trends, such as buying
earnings momentum at any price, we remain committed to a discipline of investing
in companies that we believe are inefficiently priced in the market and have
some downside protection in the event of a market decline.

*Historical performance is not an indication of future performance. These
performance results do not reflect the impact of Class A's maximum 5.5 percent
front-end sales charge or Class B's maximum 5 percent contingent deferred sales
charge. Investment returns and principal values will fluctuate so that shares
upon redemption may be worth more or less than their original cost.
**The Russell 1000 Value Index contains stock from the Russell 1000 with low
book to price ratio. The Russell 1000 is the 1,000 largest companies in the
Russell 3000. The Russell 3000 is an unmanaged index of 3,000 common stocks,
which represents approximately 98 percent of the U.S. market.

3
<PAGE>
COMPARISON OF CHANGE IN VALUE OF A HYPOTHETICAL $10,000
INVESTMENT IN THE ADVANTUS CORNERSTONE FUND,
RUSSELL 1000 VALUE INDEX AND CONSUMER PRICE INDEX

On the following charts you can see how the total return for each of the three
classes of shares of the Advantus Cornerstone Fund compared to the Russell 1000
Value Index and the Consumer Price Index. The lines in each graph represent the
cumulative total return of a hypothetical $10,000 investment made on the
inception date of each class of shares of the Advantus Cornerstone Fund
(September 16, 1994 for Class A and Class B and March 1, 1995 for Class C)
through March 31, 1999.

CLASS A AND B

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN:
<S> <C> <C> <C> <C>
Class A:
One year -14.17%
Since inception
(9/16/94) 14.39%
Class B:
One year -14.42%
Since inception
(9/16/94) 14.67%
(Thousands)
Class A Class B Russell 1000 CPI
Value Index
9/16/94 $10,000 $10,000 $10,000 $10,000
9/30/94 9,374 9,870 9,743 10,054
9/30/95 11,659 11,708 12,441 10,275
9/30/96 14,517 14,649 14,673 10,570
9/30/97 20,085 20,400 20,880 10,818
9/30/98 16,782 16,947 21,629 10,973
3/31/99 18,506 18,615 25,583 11,066
</TABLE>

4
<PAGE>
CLASS C

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN:
<S> <C> <C> <C>
Class C:
One year -9.87%
Since inception
(3/1/95) 16.25%
(Thousands)
Class C CPI Russell 1000
Value Index
3/01/95 $10,000 $10,000 $10,000
9/30/95 12,013 10,146 12,107
9/30/96 14,846 10,437 14,280
9/30/97 20,354 10,682 20,320
9/30/98 16,838 10,834 21,049
3/31/99 18,495 10,927 24,897
</TABLE>

The preceding charts are useful because they provide you with more information
about your investments. There are limitations, however. An index may reflect the
performance of securities that the Fund may not hold. Also, the index does not
deduct sales charges, investment advisory fees and other fund expenses, whereas
your Fund does. Performance presented for the Fund reflects the deduction of the
maximum 5.5 percent front-end sales charge for Class A and the maximum
applicable contingent deferred sales charge for Class B shares. The maximum
initial sales charge for Class A shares was 5.0 percent prior to February 1,
1999. Sales charges pay for your financial professional's investment advice.
Individuals cannot invest in the index itself, nor can they invest in any fund
which seeks to track the performance of the index without incurring some charges
and expenses.

Historical performance is not an indication of future performance. Investment
returns and principal values will fluctuate so that shares upon redemption may
be worth more or less than their original cost.

5
<PAGE>
TEN LARGEST STOCK HOLDINGS

<TABLE>
<CAPTION>
MARKET % OF STOCK
COMPANY SHARES VALUE PORTFOLIO
- --------------------------------------- ------- ----------- ----------
<S> <C> <C> <C>
Exxon Corporation...................... 70,185 $ 4,952,429 4.2%
International Business Machines........ 21,595 3,827,714 3.3%
AT&T Corporation....................... 47,212 3,768,108 3.2%
SBC Communications, Inc................ 75,642 3,564,629 3.1%
Morton International, Inc.............. 93,500 3,436,125 2.9%
YPF Sociedad Anonima................... 108,800 3,434,000 2.9%
Hormel Foods Corporation............... 95,900 3,416,437 2.9%
Federal National Mortgage
Association.......................... 47,900 3,317,075 2.8%
American International Group........... 26,575 3,205,609 2.7%
Travelers Group, Inc................... 49,440 3,157,980 2.7%
----------- -----
$36,080,106 30.7%
----------- -----
----------- -----
</TABLE>

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<S> <C>
Basic Materials 9.2%
Capital Goods 3.5%
Communication Services 13.3%
Consumer Cyclical 7.9%
Consumer Staples 7.8%
Energy 11.6%
Financial 27.8%
Technology 5.6%
Transportation 2.9%
Utilities 8.5%
Cash and Other
Assets/Liabilities 1.9%
</TABLE>

6
<PAGE>
Advantus Cornerstone Fund
Investments in Securities

March 31, 1999

(UNAUDITED)

(Percentages of each investment category relate to total net assets.)
<TABLE>
<CAPTION>
MARKET
SHARES VALUE(a)
- ------------ --------------
<C> <S> <C>
COMMON STOCK (98.1%)
BASIC MATERIALS (9.2%)
Chemicals (5.1%)
22,525 E.I. DuPont de Nemours and Company.................................. $ 1,307,858
93,500 Morton International, Inc........................................... 3,436,125
46,600 Sigma-Aldrich....................................................... 1,363,050
--------------
6,107,033
--------------
Iron and Steel (.7%)
107,000 Bethlehem Steel Corporation (b)..................................... 882,750
--------------
Paper and Forest (3.4%)
64,837 Fort James Corporation.............................................. 2,054,522
37,000 Louisianna-Pacific Corporation...................................... 689,125
42,400 Mead Corporation.................................................... 1,303,800
--------------
4,047,447
--------------
CAPITAL GOODS (3.5%)
Containers-Metal/Glass (.3%)
12,000 Owens-Illinois, Inc. (b)............................................ 300,000
--------------
Electrical Equipment (3.2%)
78,500 Diebold............................................................. 1,884,000
87,500 Raychem Corporation................................................. 1,974,219
--------------
3,858,219
--------------
COMMUNICATION SERVICES (13.3%)
Telecommunication (2.3%)
31,555 MCI Worldcom, Inc. (b).............................................. 2,794,590
--------------
Telephone (11.0%)
47,212 AT&T Corporation.................................................... 3,768,108
42,200 Bell Atlantic Corporation........................................... 2,181,212
55,925 Bellsouth Corporation............................................... 2,240,495
23,395 GTE Corporation..................................................... 1,415,397
75,642 SBC Communications, Inc............................................. 3,564,629
--------------
13,169,841
--------------

<CAPTION>
MARKET
SHARES VALUE(a)
- ------------ --------------
<C> <S> <C>
CONSUMER CYCLICAL (7.9%)
Auto (2.9%)
31,710 Ford Motor Company.................................................. $ 1,799,542
18,550 General Motors Corporation.......................................... 1,611,531
--------------
3,411,073
--------------
Publishing (.4%)
13,745 Reader's Digest Association......................................... 432,108
--------------
Retail (2.7%)
47,510 Consolidated Stores Corporation (b)................................. 1,440,147
43,200 Federated Department Stores (b)..................................... 1,733,400
--------------
3,173,547
--------------
Service (1.9%)
56,625 Cendant Corporation (b)............................................. 891,844
30,000 H & R Block, Inc.................................................... 1,421,250
--------------
2,313,094
--------------
CONSUMER STAPLES (7.8%)
Food (2.9%)
95,900 Hormel Foods Corporation............................................ 3,416,437
--------------
Retail (1.5%)
193,400 Food Lion, Inc...................................................... 1,779,883
--------------
Service (1.5%)
61,300 Deluxe Corporation.................................................. 1,785,362
--------------
Tobacco (1.9%)
65,500 Philip Morris Companies, Inc........................................ 2,304,781
--------------
ENERGY (11.6%)
Oil (10.6%)
16,885 Chevron Corporation................................................. 1,493,267
70,185 Exxon Corporation................................................... 4,952,429
22,555 Mobil Corporation................................................... 1,984,840
15,415 Texaco, Inc......................................................... 874,801
108,800 YPF Sociedad Anonima (c)............................................ 3,434,000
--------------
12,739,337
--------------
</TABLE>

See accompanying notes to investments in securities.

7
<PAGE>
ADVANTUS CORNERSTONE FUND
INVESTMENTS IN SECURITIES - CONTINUED
<TABLE>
<CAPTION>
MARKET
SHARES VALUE(a)
- ------------ --------------
ENERGY--CONTINUED
<C> <S> <C>
Oil & Gas (1.0%)
9,100 Atlantic Richfield Company.......................................... $ 664,300
28,500 K N Energy, Inc..................................................... 568,219
--------------
1,232,519
--------------
FINANCIAL (27.8%)
Auto Finance (.5%)
14,880 Fleet Financial Group, Inc.......................................... 559,860
--------------
Banks (9.8%)
38,810 Bank One Corporation................................................ 2,136,976
42,500 BankAmerica Corporation (b)......................................... 3,001,563
23,790 Chase Manhattan Corporation......................................... 1,934,424
25,400 First Union Corporation............................................. 1,357,313
9,600 National City Corporation........................................... 637,200
49,500 TCF Financial Corporation........................................... 1,287,000
40,480 Wells Fargo Company................................................. 1,419,330
--------------
11,773,806
--------------
Consumer Finance (1.7%)
17,500 American Express Company............................................ 2,056,250
--------------
Finance-Diversified (2.8%)
47,900 Federal National Mortgage Association............................... 3,317,075
--------------
Insurance (8.0%)
21,850 Allstate Corporation................................................ 809,816
26,575 American International Group........................................ 3,205,609
76,000 Everest Reinsurance Holdings........................................ 2,370,250
49,440 Travelers Group, Inc................................................ 3,157,980
--------------
9,543,655
--------------
Investment Bankers/Brokers (1.3%)
16,020 Morgan Stanley Dean Witter.......................................... 1,600,999
--------------

<CAPTION>
MARKET
SHARES VALUE(a)
- ------------ --------------
<C> <S> <C>
FINANCIAL--CONTINUED
Real Estate Investment Trust (2.0%)
57,300 Equity Residential Properties....................................... $ 2,363,625
--------------
Savings and Loans (1.7%)
164,960 Sovereign Bancorp, Inc.............................................. 2,020,760
--------------
TECHNOLOGY (5.6%)
33,800 Electronic Data Systems Corporation................................. 1,645,638
9,855 Hewlett-Packard Company............................................. 668,292
21,595 International Business Machines..................................... 3,827,714
19,300 Nova Corporation (b)................................................ 506,625
--------------
6,648,269
--------------
TRANSPORTATION (2.9%)
Air Freight (.1%)
5,700 Airborne Freight Corporation........................................ 177,413
--------------
Railroads (1.4%)
31,100 Union Pacific Corporation........................................... 1,661,906
--------------
Trucking (1.4%)
43,800 CNF Transportation.................................................. 1,656,188
--------------
UTILITIES (8.5%)
Electric Companies (7.1%)
35,000 AES Corporation (b)................................................. 1,303,750
59,200 Dominion Resources, Inc............................................. 2,186,700
112,000 Teco Energy......................................................... 2,226,000
67,800 Texas Utilities Company............................................. 2,826,413
--------------
8,542,863
--------------
Natural Gas (1.4%)
51,000 El Paso Energy Corporation.......................................... 1,667,063
--------------
Total common stock (cost: $104,775,838)............................................ 117,337,753
--------------
</TABLE>

See accompanying notes to investments in securities.

8
<PAGE>
ADVANTUS CORNERSTONE FUND
INVESTMENTS IN SECURITIES - CONTINUED

<TABLE>
<CAPTION>
MARKET
PRINCIPAL VALUE(a)
- ------------ --------------
<C> <S> <C> <C> <C>
SHORT-TERM SECURITIES (2.0%)
$ 1,998,750 Federated Prime $ 1,998,750
Obligation Fund,
current rate 4.860%....
380,000 U.S. 377,698
Treasury
Note... 4.572% 05/20/99
--------------
Total short-term
securities (cost:
$2,376,432)............ 2,376,448
--------------
Total investments in
securities (cost:
$107,152,270)(d)....... $ 119,714,201
--------------
--------------
</TABLE>

Notes to Investments in Securities
- -----------------------------------
(a) Securities are valued by procedures described in note 2 to the financial
statements.
(b) Presently non-income producing.
(c) The Fund held 2.9% of the net assets in foreign securities as of March 31,
1999.
(d) At March 31, 1999 the cost of securities for federal income tax purposes was
$107,260,406. The aggregate unrealized appreciation and depreciation of
investments in securities based on this cost were:

<TABLE>
<S> <C>
Gross unrealized appreciation...................................................... $ 18,259,538
Gross unrealized depreciation...................................................... (5,805,743)
--------------
Net unrealized appreciation........................................................ $ 12,453,795
--------------
--------------
</TABLE>

9
<PAGE>
ADVANTUS CORNERSTONE FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 1999
(UNAUDITED)

<TABLE>
<S> <C>
ASSETS
Investments in securities, at market value - see
accompanying schedule for detailed listing
(identified cost: $107,152,270)............................ $ 119,714,201
Cash in bank on demand deposit.............................. 6
Receivable for Fund shares sold............................. 25,560
Receivable for investment securities sold................... 383,180
Accrued interest receivable................................. 6,289
Dividends receivable........................................ 188,856
Organizational costs (note 5)............................... 4,642
Other receivables........................................... 893
--------------
Total assets............................................ 120,323,627
--------------
LIABILITIES
Payable for investment securities purchased................. 303,662
Payable for Fund shares redeemed............................ 248,273
Payable to Adviser.......................................... 156,920
Other payables.............................................. 174
--------------
Total liabilities....................................... 709,029
--------------
Net assets applicable to outstanding capital stock.......... $ 119,614,598
--------------
--------------
Represented by:
Capital stock - authorized 10 billion shares (Class A - 2
billion shares, Class B - 2 billion shares, Class C - 2
billion shares and 4 billion shares unallocated) of $.01
par value (note 1)....................................... $ 78,780
Additional paid-in capital................................ 111,932,760
Undistributed net investment income....................... 20,497
Accumulated net realized losses from investments.......... (4,979,370)
Unrealized appreciation on investments.................... 12,561,931
--------------
Total - representing net assets applicable to
outstanding capital stock.............................. $ 119,614,598
--------------
--------------
Net assets applicable to outstanding Class A shares......... $ 96,340,067
--------------
--------------
Net assets applicable to outstanding Class B shares......... $ 20,581,040
--------------
--------------
Net assets applicable to outstanding Class C shares......... $ 2,693,491
--------------
--------------
Shares outstanding and net asset value per share:...........
Class A - Shares outstanding 6,330,592.................... $ 15.22
--------------
--------------
Class B - Shares outstanding 1,367,942.................... $ 15.05
--------------
--------------
Class C - Shares outstanding 179,503...................... $ 15.01
--------------
--------------
</TABLE>

See accompanying notes to financial statements.

10
<PAGE>
ADVANTUS CORNERSTONE FUND
STATEMENT OF OPERATIONS
FOR THE SIX-MONTH PERIOD ENDED MARCH 31, 1999
(UNAUDITED)

<TABLE>
<S> <C>
Investment income:
Interest.................................................. $ 97,556
Dividends................................................. 1,384,179
--------------
Total investment income............................... 1,481,735
--------------
Expenses (note 4):
Investment advisory fee................................... 505,240
Rule 12b-1 fees - Class A................................. 143,250
Rule 12b-1 fees - Class B................................. 110,875
Rule 12b-1 fees - Class C................................. 15,402
Administrative services fee............................... 26,200
Amortization of organizational costs...................... 5,550
Custodian fees............................................ 1,318
Auditing and accounting services.......................... 7,471
Legal fees................................................ 4,750
Directors' fees........................................... 1,105
Registration fees......................................... 24,475
Printing and shareholder reports.......................... 27,057
Insurance................................................. 1,956
Other..................................................... 4,949
--------------
Total expenses........................................ 879,598
Less fees and expenses waived or absorbed:
Class A Rule 12b-1 fees................................. (16,931)
--------------
Total net expenses.................................... 862,667
--------------
Investment income - net............................... 619,068
--------------
Realized and unrealized losses on investments:
Net realized losses on investments (note 3)............... (576,532)
Net change in unrealized appreciation or depreciation on
investments.............................................. 12,052,163
--------------
Net gains on investments.............................. 11,475,631
--------------
Net increase in net assets resulting from operations........ $ 12,094,699
--------------
--------------
</TABLE>

See accompanying notes to financial statements.

11
<PAGE>
ADVANTUS CORNERSTONE FUND
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX-MONTH PERIOD ENDED MARCH 31, 1999 AND YEAR ENDED SEPTEMBER 30, 1998
(UNAUDITED)

<TABLE>
<CAPTION>
1999 1998
------------- -------------
<S> <C> <C>
Operations:
Investment income - net................................... $ 619,068 $ 1,114,681
Net realized loss on investments.......................... (576,532) (957,360)
Net change in unrealized appreciation or depreciation on
investments.............................................. 12,052,163 (23,581,265)
------------- -------------
Increase (decrease) in net assets resulting from
operations........................................... 12,094,699 (23,423,944)
------------- -------------
Distributions to shareholders from:
Investment income - net:
Class A................................................. (574,573) (1,055,429)
Class B................................................. (43,200) (55,277)
Class C................................................. (5,227) (7,294)
Net realized gains on investments:
Class A................................................. -- (10,892,809)
Class B................................................. -- (2,297,711)
Class C................................................. -- (378,519)
------------- -------------
Total distributions................................... (623,000) (14,687,039)
------------- -------------
Capital share transactions (notes 4 and 6):
Proceeds from sales:
Class A................................................. 3,483,879 29,714,273
Class B................................................. 1,390,485 11,465,827
Class C................................................. 238,603 2,734,418
Proceeds from issuance of shares as a result of reinvested
dividends:
Class A................................................. 372,305 8,864,188
Class B................................................. 44,164 2,275,526
Class C................................................. 5,239 364,701
Payments for redemption of shares:
Class A................................................. (10,457,254) (21,641,291)
Class B................................................. (4,090,138) (7,290,091)
Class C................................................. (947,459) (2,399,684)
------------- -------------
Increase (decrease) in net assets from capital share
transactions......................................... (9,960,176) 24,087,867
------------- -------------
Total increase (decrease) in net assets............... 1,511,523 (14,023,116)
Net assets at beginning of period........................... 118,103,075 132,126,191
------------- -------------
Net assets at end of period (including undistributed net
investment income of $20,497 and $18,879, respectively).... $ 119,614,598 $ 118,103,075
------------- -------------
------------- -------------
</TABLE>

See accompanying notes to financial statements.

12
<PAGE>
Advantus Cornerstone Fund
Notes to Financial Statements
MARCH 31, 1999
(UNAUDITED)

(1) ORGANIZATION

Advantus Cornerstone Fund, Inc. (the Fund) was incorporated on January 27,
1994. The Fund is registered under the Investment Company Act of 1940 (as
amended) as a diversified, open-end management investment company. The Fund's
investment objective is to seek long-term accumulation of capital.

The Fund currently issues three classes of shares: Class A, Class B and
Class C shares. Class A shares are sold subject to a front-end sales charge.
Class B shares are sold subject to a contingent deferred sales charge payable
upon redemption if redeemed within six years of purchase. Class C shares are
sold without either a front-end sales charge or a contingent deferred sales
charge. Both Class B and Class C are subject to a higher Rule 12b-1 fee than
Class A shares. Both Class B and Class C shares automatically convert to Class A
shares at net asset value after a specified holding period. Such holding periods
decline as the amount of the purchase increases and range from 28 to 84 months
after purchase for Class B shares and 40 to 96 months after purchase for Class C
shares. All three classes of shares have identical voting, dividend, liquidation
and other rights and the same terms and conditions, except that the level of
Rule 12b-1 fees charged differs between Class A, Class B and Class C shares.
Income, expenses (other than Rule 12b-1 fees) and realized and unrealized gains
or losses are allocated to each class of shares based upon its relative net
assets.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies followed by the Fund are summarized as
follows:

USE OF ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts in the financial statements. Actual
results could differ from those estimates.

INVESTMENTS IN SECURITIES

The Fund's net asset value is generally calculated as of the close of normal
trading on the New York Stock Exchange (typically 3:00 p.m. Central Time).
Investments in securities traded on a national exchange are valued at the last
sales price on that exchange prior to the time when assets are valued;
securities traded in the over-the-counter market and listed securities for which
no sale was reported on that date are valued on the basis of the last current
bid price, by an independent pricing service or at a price deemed best to
reflect fair value as quoted by dealers who make markets in these securities.
When market quotations are not readily available, securities are valued at fair
value as determined in good faith under procedures adopted by the Board of
Directors. Short-term securities are valued at market.

Security transactions are accounted for on the date the securities are
purchased or sold. Realized gains and losses are calculated on the
identified-cost basis. Dividend income is recognized on the ex-dividend date and
interest income, including amortization of bond premium and discount computed on
a level yield basis, is accrued daily.

FEDERAL TAXES

The Fund's policy is to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
taxable income to shareholders. Therefore, no income tax provision is required.
The Fund's policy is to make required minimum distributions prior to December
31, in order to avoid federal excise tax.

13
<PAGE>
ADVANTUS CORNERSTONE FUND
NOTES TO FINANCIAL STATEMENTS - CONTINUED

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED)

Net investment income and net realized gains (losses) may differ for
financial statement and tax purposes primarily because of temporary book-to-tax
differences. The character of distributions made during the year from net
investment income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. Also, due to the timing of
dividend distributions, the fiscal year in which amounts are distributed may
differ from the year that the income or realized gains (losses) were recorded by
the Fund.

On the statement of assets and liabilities, as a result of permanent
book-to-tax differences, a reclassification adjustment was made to increase
undistributed net investment income and decrease additional paid-in capital by
$5,550.

DISTRIBUTIONS TO SHAREHOLDERS

Dividends from net investment income are declared and paid quarterly.
Realized gains, if any, are paid annually.

(3) INVESTMENT SECURITY TRANSACTIONS

For the period ended March 31, 1999, purchases of securities and proceeds
from sales, other than temporary investments in short-term securities aggregated
$21,546,063 and $29,161,295, respectively.

(4) EXPENSES AND RELATED PARTY TRANSACTIONS

The Fund has an investment advisory agreement with Advantus Capital
Management, Inc. (Advantus Capital or the Adviser), a wholly-owned subsidiary of
Minnesota Life Insurance Company (Minnesota Life), formerly known as The
Minnesota Mutual Life Insurance Company. Under the agreement, Advantus Capital
manages the Fund's assets and provides research, statistical and advisory
services and pays related office rental and executive expenses and salaries. In
addition, as part of the advisory fee, Advantus Capital pays the expenses of the
Fund's transfer, dividend disbursing and redemption agent (First Data Investor
Services Group). Prior to October 26, 1998, the Fund's transfer agent was
Minnesota Life. The fee for investment management and advisory services is based
on the average daily net assets of the Fund at the annual rate of .80 percent.

The Fund has adopted separate Plans of Distribution applicable to Class A,
Class B and Class C shares, respectively, relating to the payment of certain
expenses pursuant to Rule 12b-1 under the Investment Company Act of 1940 (as
amended). The Fund pays fees to Ascend Financial Services, Inc. (Ascend), the
underwriter of the Fund and wholly-owned subsidiary of Advantus Capital, to be
used to pay certain expenses incurred in the distribution, promotion and
servicing of the Fund's shares. The Class A Plan provides for a service fee up
to .25 percent of average daily net assets of Class A shares. Prior to February
1, 1999, the Class A Plan provided for a distribution fee up to .30 percent of
average daily net assets of Class A shares. The Class B and Class C Plans
provide for a fee up to 1.00 percent of average daily net assets of Class B and
Class C shares, respectively. The Class B and Class C 1.00 percent fee is
comprised of a .75 percent distribution fee and a .25 percent service fee. Prior
to February 1, 1999, Ascend waived that portion of Class A Rule 12b-1 fees which
exceeded, as a percentage of average daily net assets, .25 percent. The total
amount of Rule 12b-1 fees waived for the period from October 1, 1998 to February
1, 1999 was $16,931.

The Fund also bears certain other operating expenses including outside
directors' fees, custodian fees, registration fees, printing and shareholder
reports, legal, auditing and accounting services, organizational costs and other
miscellaneous expenses.

14
<PAGE>
ADVANTUS CORNERSTONE FUND
NOTES TO FINANCIAL STATEMENTS - CONTINUED

(4) EXPENSES AND RELATED PARTY TRANSACTIONS - (CONTINUED)

Effective October 26, 1998, the Fund entered into a new shareholder and
administrative services agreement with Minnesota Life. Under this agreement, the
Fund pays an administrative services fee equal to $5,700 per month to Minnesota
Life for accounting, auditing, legal and other administrative services which
Minnesota Life provides. Prior to February 1, 1999, the administrative services
fee was $3,700 per month. In addition, for shareholder services performed by
Minnesota Life, the Adviser will pay Minnesota Life an annual account servicing
fee as agreed by the Adviser and Minnesota Life.

Advantus Capital directly incurs and pays the above operating expenses and
the Fund in turn reimburses Advantus Capital.

Sales charges received by Ascend for distributing the Fund's three classes
of shares amounted to $45,129.

As of March 31, 1999, Minnesota Life and subsidiaries and the directors and
officers of the Fund as a whole owned 2,264,365 Class A shares which represents
35.8 percent of the total outstanding Class A shares.

Legal fees were paid to a law firm of which the Fund's secretary is a
partner in the amount of $4,750.

(5) ORGANIZATIONAL COSTS

The Fund incurred organizational expenses in connection with the start-up
and initial registration. These costs will be amortized over 60 months on a
straight-line basis beginning with the commencement of operations. If any or all
of the shares held by Advantus Capital, or any other holder, representing
initial capital of the Fund are redeemed during the amortization period, the
redemption proceeds will be reduced by the pro rata portion (based on the ratio
that the number of initial shares redeemed bears to the total number of
outstanding initial shares of the Fund at the date of redemption) of the
unamortized organizational cost balance.

(6) CAPITAL SHARE TRANSACTIONS

Transactions in shares for the period from October 1, 1998 to March 31, 1999
and the year ended September 30, 1998 were as follows:

<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
--------------------- -------------------- --------------------
1999 1998 1999 1998 1999 1998
--------- ---------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Sold..................................... 229,295 1,800,201 92,314 705,598 15,693 169,067
Issued for reinvested distributions...... 23,962 554,502 2,872 144,152 340 23,295
Redeemed................................. (681,051) (1,342,646) (269,864) (463,039) (62,606) (150,239)
--------- ---------- --------- --------- --------- ---------
(427,794) 1,012,057 (174,678) 386,711 (46,573) 42,123
--------- ---------- --------- --------- --------- ---------
--------- ---------- --------- --------- --------- ---------
</TABLE>

(7) YEAR 2000

In 1995, Minnesota Life began addressing computer systems requirements and
applications to be Year 2000 ready. Based on a current study, Minnesota Life
plans to spend approximately $14 million through 1999 to modify its computer
information systems, enabling proper processing of transactions relating to the
year 2000 and beyond. The Fund will not be charged for these expenses.

15
<PAGE>
ADVANTUS CORNERSTONE FUND
NOTES TO FINANCIAL STATEMENTS - CONTINUED

(8) Per share data for a share of capital stock and selected information for
each period are as follows:

<TABLE>
<CAPTION>
CLASS A
------------------------------------------------------------------------------------
PERIOD FROM
OCTOBER 1, PERIOD FROM
1998 TO YEAR ENDED SEPTEMBER 30, SEPTEMBER 16,
MARCH 31, ---------------------------------------------------- 1994(b) TO
1999 1998 1997 1996 1995(a) 1994
------------ --------- ---------- --------- --------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period... $ 13.88 $ 18.68 $ 15.06 $ 12.96 $ 10.63 $ 10.77
------------ --------- ---------- --------- --------------- --------------
Income from investment operations:
Net investment income (loss)......... .09 .16 .14 .09 .12 .01
Net gains (losses) on securities
(both realized and unrealized)..... 1.34 (3.04) 5.19 2.91 2.42 (.15)
------------ --------- ---------- --------- --------------- --------------
Total from investment operations... 1.43 (2.88) 5.33 3.00 2.54 (.14)
------------ --------- ---------- --------- --------------- --------------
Less distributions:
Dividends from net investment
income............................. (.09) (.16) (.14) (.08) (.16) --
Distributions from capital gains..... -- (1.76) (1.57) (.82) (.05) --
------------ --------- ---------- --------- --------------- --------------
Total distributions................ (.09) (1.92) (1.71) (.90) (.21) --
------------ --------- ---------- --------- --------------- --------------
Net asset value, end of period......... $ 15.22 $ 13.88 $ 18.68 $ 15.06 $ 12.96 $ 10.63
------------ --------- ---------- --------- --------------- --------------
------------ --------- ---------- --------- --------------- --------------
Total return(c)........................ 10.28% (16.45)% 38.35% 24.52% 24.38% (1.30)%
Net assets, end of period (in
thousands)........................... $96,340 $ 93,833 $ 107,322 $ 48,383 $ 29,520 $10,616
Ratio of expenses to average daily net
assets(d)(e)......................... 1.22%(g) 1.16% 1.08% 1.26% 1.35% .05%(f)
Ratio of net investment income (loss)
to average daily net assets(d)(e).... 1.13%(g) .98% .85% .70% 1.01% .07%(f)
Portfolio turnover rate (excluding
short-term securities)............... 17.8% 114.4% 87.7% 128.0% 160.1% 8.1%
</TABLE>

- ------------

(a) Effective March 1, 1995, the Fund entered into a new investment advisory
agreement with Advantus Capital Management, Inc. Prior to March 1, 1995,
the Fund has an investment advisory agreement with MIMLIC Asset Management
Company.
(b) Commencement of operations.
(c) Total return figures are based on a share outstanding throughout the period
and assume reinvestment of distributions at net asset value. Total return
figures do not reflect the impact of front-end and contingent deferred
sales charges. For periods less than one year, total return presented has
not been annualized.
(d) The Fund's Distributor voluntarily waived $16,931, $107,096, $149,466 and
$74,454 in Class A Rule 12b-1 fees for the period ended March 31, 1999 and
the years ended September 30, 1998, 1997 and 1996, respectively. If the
Fund had been charged for these fees, the ratio of expenses to average
daily net assets would have been 1.25%, 1.25%, 1.28% and 1.46%,
respectively, and the ratio of net investment income to average daily net
assets would have been 1.10%, .89%, .65% and .50%, respectively, for Class
A shares.
(e) The Fund's Distributor and Adviser voluntarily waived or absorbed $83,746
and $1,872 in expenses for the year ended September 30,1995 and the period
ended September 30, 1994. If the Fund had been charged for these expenses,
the ratio of expenses to average daily net assets would have been 1.81% and
.07% for Class A shares, 2.45% and .10% for Class B shares and 2.34% for
Class C shares, and the ratio of net investment income (loss) to average
daily net assets would have been .56% and .05% for Class A shares, (.15)%
and .02% for Class B shares and (.16)% for Class C shares.
(f) Ratios presented for the period from September 16, 1994 to September 30,
1994 are not annualized as they are not indicative of anticipated results.
(g) Adjusted to an annual basis.

16
<PAGE>
ADVANTUS CORNERSTONE FUND
NOTES TO FINANCIAL STATEMENTS - CONTINUED
<TABLE>
<CAPTION>
CLASS B
-----------------------------------------------------------------------------------
PERIOD FROM PERIOD FROM
OCTOBER 1, SEPTEMBER 16,
1998 TO YEAR ENDED SEPTEMBER 30, 1994(b) TO
MARCH 31, --------------------------------------------------- SEPTEMBER 30,
1999 1998 1997 1996 1995(a) 1994
------------ --------- --------- --------- --------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period... $ 13.73 $ 18.52 $ 14.92 $ 12.90 $ 10.63 $ 10.77
------------ --------- --------- --------- --------------- --------------
Income from investment operations:
Net investment income (loss)......... .03 .03 -- (.01) .02 (.01)
Net gains (losses) on securities
(both realized and unrealized)..... 1.32 (3.02) 5.18 2.86 2.41 (.13)
------------ --------- --------- --------- --------------- --------------
Total from investment operations... 1.35 (2.99) 5.18 2.85 2.43 (.14)
------------ --------- --------- --------- --------------- --------------
Less distributions:
Dividends from net investment
income............................. (.03) (.04) (.01) (.01) (.11) --
Distributions from capital gains..... -- (1.76) (1.57) (.82) (.05) --
------------ --------- --------- --------- --------------- --------------
Total distributions................ (.03) (1.80) (1.58) (.83) (.16) --
------------ --------- --------- --------- --------------- --------------
Net asset value, end of period......... $ 15.05 $ 13.73 $ 18.52 $ 14.92 $ 12.90 $ 10.63
------------ --------- --------- --------- --------------- --------------
------------ --------- --------- --------- --------------- --------------
Total return(c)........................ 9.76% (17.21)% 37.68% 23.37% 23.18% (1.30)%
Net assets, end of period (in
thousands)........................... $20,581 $ 21,176 $ 21,405 $ 7,095 $ 1,635 $ 93
Ratio of expenses to average daily net
assets(d)(e)......................... 1.97%(g) 1.95% 1.98% 2.15% 2.25% .09%(f)
Ratio of net investment income (loss)
to average daily net assets(d)(e).... .38%(g) .18% (.05)% (.11)% %.05 .03%(f)
Portfolio turnover rate (excluding
short-term securities)............... 17.8% 114.4% 87.7% 128.0% 160.1% 8.1%

<CAPTION>
CLASS C
-----------------------------------------------------------------
PERIOD FROM PERIOD FROM
OCTOBER 1, MARCH 1,
1998 TO YEAR ENDED SEPTEMBER 30, 1995(b) TO
MARCH 31, --------------------------------- SEPTEMBER 30,
1999 1998 1997 1996 1995
------------ --------- --------- --------- --------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period... $ 13.68 $ 18.48 $ 14.94 $ 12.90 $ 10.79
------------ --------- --------- --------- --------------
Income from investment operations:
Net investment income (loss)......... .04 .03 -- -- .02
Net gains (losses) on securities
(both realized and unrealized)..... 1.32 (3.04) 5.12 2.88 2.14
------------ --------- --------- --------- --------------
Total from investment operations... 1.36 (3.01) 5.12 2.88 2.16
------------ --------- --------- --------- --------------
Less distributions:
Dividends from net investment
income............................. (.03) (.03) (.01) (.02) (.05)
Distributions from capital gains..... -- (1.76) (1.57) (.82) --
------------ --------- --------- --------- --------------
Total distributions................ (.03) (1.79) (1.58) (.84) (.05)
------------ --------- --------- --------- --------------
Net asset value, end of period......... $ 15.01 $ 13.68 $ 18.48 $ 14.94 $ 12.90
------------ --------- --------- --------- --------------
------------ --------- --------- --------- --------------
Total return(c)........................ 9.84% (17.28)% 37.10% 23.59% 20.13%
Net assets, end of period (in
thousands)........................... $ 2,693 $ 3,094 $ 3,399 $ 1,156 $ 47
Ratio of expenses to average daily net
assets(d)(e)......................... 1.97%(g) 1.95% 1.98% 2.13% 2.25%(g)
Ratio of net investment income (loss)
to average daily net assets(d)(e).... .40%(g) .18% (.05)% (.01)% (.07)%(g)
Portfolio turnover rate (excluding
short-term securities)............... 17.8% 114.4% 87.7% 128.0% 160.1%
</TABLE>

- ------------

17
<PAGE>
SHAREHOLDER SERVICES

The Advantus Family of Funds offers a variety of services that enhance your
ability to manage your assets. Check each Fund's prospectus for the details of
the services and any limitations that apply to a particular Fund.

EXCHANGE PRIVILEGES: You can move all or part of your investment dollars from
one fund to any other Advantus Fund you own (for identical registrations within
the same share class) at any time as your needs change. Exchanges are at the
then current net asset value (exchanges from the Advantus Money Market Fund will
incur the applicable sales charge, if not previously subjected to the charge).
Shareholders may make twelve exchanges each calendar year without incurring a
transaction charge. Thereafter, there will be a $7.50 transaction charge for
each additional exchange within the calendar year.

INCOME DISTRIBUTION FLEXIBILITY: You can have your fund dividends and other
distributions automatically reinvested with no sales charge, direct them from
one Advantus Fund to any other you own within the Fund family or, if you desire,
we'll pay you in cash.

SYSTEMATIC WITHDRAWAL PLAN: You can set up a plan to receive a check at
specified intervals from your fund account - subject to minimum guidelines.
Depending upon the performance of the underlying investment options, the value
may be worth more or less than the original amount invested when withdrawn.

DIRECT DIVIDEND DEPOSITS: At your request we will deposit your dividends or
systematic withdrawals directly into your checking or savings account instead of
sending you a check.

TELEPHONE EXCHANGE: You may move money from one Advantus account to any other
Advantus account you own (with identical registrations within the same share
class) just by calling our toll-free number. The Telephone Exchange privilege
will automatically be established unless otherwise indicated on the Account
Application. Telephone Exchange may be changed (added/deleted) at any time by
submitting a request in writing.

SYSTEMATIC EXCHANGE: You may move a set amount of money monthly or quarterly
from one Advantus Fund to another Advantus Fund (with identical registrations
within the same share class) to diversify your investment portfolio and take
advantage of dollar-cost averaging.

AUTOMATIC PAYMENT OF INSURANCE PREMIUMS: You may automatically pay your
Minnesota Life insurance premiums from your Advantus Money Market account.

REDUCED SALES CHARGES: Letter of Intent, combined purchases with spouse,
children or single trust estates, and the Right of Accumulation make it possible
for you to reduce the sales charge, if any.

SPECIAL PURCHASE PLANS: Special purchase plans enable you to open an Advantus
Fund account for as little as $25 and lower your average share cost through
"dollar-cost averaging." (Dollar-cost averaging does not assure a profit, nor
does it prevent loss in declining markets.) The Automatic Investment Plan allows
you to invest automatically monthly, semi-monthly or quarterly from your
checking or savings account.

IRAS, OTHER QUALIFIED PLAN: You can use the Advantus Family of Funds for your
Traditional or Roth Individual Retirement Account or other qualified plan
including: SEP IRA's, SIMPLE IRA's, Profit Sharing, 401(k) Money Purchase or
Defined Benefit plans.

GROUP INVESTMENT PLAN: This plan provides employers and employees with a
convenient means for investing in the funds through payroll deduction.

TELEPHONE REDEMPTION: You may call us and redeem shares over the phone. The
proceeds will be sent by check to the address of record for the account or wire
transferred to your bank of record for the Account. Wire transfers are for
amounts over $500. The prevailing wire charge will be added to the withdrawal
amount. The Telephone Redemption privilege will automatically be established
unless otherwise indicated on the Account

18
<PAGE>
Application. Telephone Redemption may be changed (added/deleted) at any time by
submitting a request in writing. To have the redemption automatically deposited
into your checking account, please send a voided check from your bank. Depending
on the performance of the underlying investment options, the value may be worth
more or less than the original amount invested upon redemption. Some limitations
apply, please refer to the prospectus for details.

ACCOUNT UPDATES: You'll receive written confirmation of every investment you
initiate and quarterly statements to help you track all of your Advantus Fund
investments and annual tax statements. Semi-annual and annual reports will
provide you with portfolio information, fund performance data and the current
investment outlook.

TOLL-FREE SERVICE LINE: For your convenience in obtaining information and
assistance directly from Advantus Shareholder Services, call 1-800-665-6005.
Advantus Account Representatives are available Monday through Friday from 8 a.m.
to 4:45 p.m. Central Time. Our voice response system is available 24 hours,
seven days a week. This system allows you to access current net asset values,
account balances and recent account activity.

HOW TO INVEST

You can invest in one or more of the eleven Advantus Funds through a local
Registered Representative of Ascend Financial Services, Inc., distributor of the
Funds. Contact your representative for information and a prospectus for any of
the Advantus Funds you are interested in. To find a Registered Representative
near you, call the toll-free service line (1-800-665-6005).

MINIMUM INVESTMENTS: Your initial investment in any of the Advantus Funds can
be as small as $25 when you use our Systematic Investment Plan. Minimum lump-sum
initial investment is $250. Minimum subsequent investment is $25.

THE FUND'S MANAGER

Advantus Capital Management, Inc., investment adviser to the Fund, selects and
reviews the Fund's investments and provides executive and other personnel for
the Fund's management. (For the Advantus International Balanced Fund, Inc., the
sub-adviser, Templeton Investment Counsel, Inc., selects the Fund's
investments.)

Advantus Capital Management, Inc. manages thirteen mutual funds containing $3.2
billion in assets in addition to $10.8 billion in assets for other clients.
Advantus Capital's seasoned portfolio managers average more than 13 years of
investment experience.

ADVANTUS FAMILY OF FUNDS

Advantus Bond Fund
Advantus Horizon Fund
Advantus Spectrum Fund
Advantus Enterprise Fund
Advantus Cornerstone Fund
Advantus Money Market Fund
Advantus Mortgage Securities Fund
Advantus International Balanced Fund
Advantus Venture Fund
Advantus Index 500 Fund
Advantus Real Estate Securities Fund

19
<PAGE>
THIS REPORT HAS BEEN PREPARED FOR SHAREHOLDERS AND MAY BE DISTRIBUTED
TO OTHERS ONLY IF PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS.
READ THE PROSPECTUS CAREFULLY BEFORE YOU INVEST.

[LOGO]
ASCEND FINANCIAL SERVICES, INC.,
SECURITIES DEALER, MEMBER NASD/SIPC
400 ROBERT STREET NORTH
ST. PAUL, MN 55101-2098
1-800-AFS-1838
(1-800-237-1838)
<PAGE>

ASCEND FINANCIAL SERVICES, INC.
400 ROBERT STREET NORTH [LOGO]
ST. PAUL, MN 55101-2098
ADDRESS SERVICE REQUESTED

F.48648 Rev. 5-1999