KIEWIT MUTUAL FUND
MONEY MARKET PORTFOLIO
SHORT-TERM GOVERNMENT PORTFOLIO
INTERMEDIATE-TERM BOND PORTFOLIO
TAX-EXEMPT PORTFOLIO
EQUITY PORTFOLIO
KMF
SEMI-ANNUAL REPORT
DECEMBER 31, 1997
KMF
Dear Shareholder:
The management of the Kiewit Mutual Fund is pleased to report to you on
the Fund's activity for the semi-annual period ended December 31, 1997.
Investment Strategy
During the third quarter of 1997, Kiewit Investment Management Corp., the
Fund's adviser, made strategic changes to improve the quality,
diversification, and liquidity of the Kiewit Mutual Fund portfolios. The
Adviser also made structural changes in each portfolio to reduce return
divergences from the specific benchmark used. The Adviser now manages each
portfolio by a team approach rather than by a single individual's efforts. The
NAVs of the fixed-income portfolios were raised to approximately $10/share
late in the third quarter through a 1-for-5 reverse stock split. This change
allows for better visibility of the portfolios' price fluctuations and reduces
rounding error associated with shareholder transactions. The portfolios
maintain minimal cash positions. Our investment philosophy is based on a
disciplined, risk-controlled, "no surprises" approach to investing.
Money Market Portfolio: As of the end of September 1997, the Adviser made a
policy decision to purchase only first-tier money market securities. The
Adviser continues to find good value in commercial paper, maintains an average
maturity of approximately 40 days, and performs extensive credit analysis in
compliance with SEC Rule 2a-7.
Short-Term Government Portfolio: During the third quarter of 1997, the
holdings of U.S. Treasury securities were increased to approximately 90% of
the Portfolio's market value, thereby raising the Portfolio's average quality.
Holdings of Federal Agency securities were reduced accordingly. By
consolidating positions down to 10-15 securities, the overall liquidity of the
Portfolio was enhanced.
Intermediate-Term Bond Portfolio: At the end of the third quarter of 1997, the
benchmark for the Kiewit Intermediate-Term Bond Portfolio was changed from the
Lehman Brothers Intermediate-Term Corporate Bond Index to the Lehman Brothers
Intermediate-Term Government/Corporate Bond Index. This move raised the
average quality and overall liquidity of the benchmark. The Portfolio was
adjusted accordingly and now offers high quality, excellent liquidity, and
better diversification. The Portfolio's holdings of U.S. Government securities
were increased substantially (to approximately 75% from approximately 15%),
while its Corporate securities exposure was reduced significantly (from
approximately 85% to approximately 25%).
Tax-Exempt Portfolio: During the second half of 1997, the Tax-Exempt Portfolio
was restructured to concentrate its holdings in effective maturities ranging
from three years to seven years. Its duration is kept close to that of the
benchmark (the Lehman Brothers 5-Year Municipal Bond Index). The Portfolio's
exposure to various states more closely resembles the weightings in the
benchmark than previously. This should reduce periodic return differences vis-
a-vis the benchmark.
Equity Portfolio: During the third quarter of 1997, the Equity Portfolio was
substantially restructured to provide better diversification, more exposure to
large-capitalization stocks, and reduced performance differentials vis-a-vis
the Standard & Poor's 500 Stock Index. The Portfolio now holds approximately
300 stocks as compared to approximately 65 stocks previously. The Portfolio
offers excellent diversification across a wide variety of industry sectors.
Investment Results*
The Money Market Portfolio's total return for the semi-annual period
ended December 31, 1997 was 2.79%. That return consisted of income
distributions (dividends) of $0.03 per share. The Portfolio's return compares
favorably with both the total return reported for Lipper's Taxable Money
Market Instrument Fund Universe Average (2.48%) and the total return for
Lipper's Institutional Money Market Fund Universe Average over the same period
(2.69%).
The Short-Term Government Portfolio's total return for the semi-annual
period was 3.26%. That return consisted of an increase in net asset value of
$0.03 per share (increasing from $10.05 to $10.08) and income and realized
gain distributions (dividends) of $0.29 per share. The Portfolio's return
falls short of the 3.67% total return reported for the unmanaged Lehman 1-3
Year Government Index over the same period. The Lehman 1-3 Year Government
Index is a total return performance benchmark consisting of U.S. Government
Agency and Treasury securities with maturities from one to three years.
The Intermediate-Term Bond Portfolio's total return for the semi-annual
period was 5.29%. That return consisted of an increase in net asset value of
$0.20 per share (increasing from $10.15 to $10.35) and income
and realized gain distributions (dividends) of $0.33 per share. The
Portfolio's return falls short of the 5.38% total return reported for the
unmanaged performance benchmark (Lehman Intermediate-Term Corporate Bond
Index for the third quarter; Lehman Intermediate-Term Government/Corporate
Bond Index for the fourth quarter) over the same period.
The Tax-Exempt Portfolio's total return for the semi-annual period was
3.39%. That return consisted of income and realized gain distributions
(dividends) of $0.34 per share. There was no change in the NAV for the period.
The Portfolio's return falls short of the 3.87% total return reported for the
unmanaged Lehman 5-Year Municipal Bond Index. The Lehman 5-Year Municipal Bond
Index is a total return performance benchmark consisting of tax-exempt
municipal bonds rated at least investment grade with maturities ranging from
four to six years.
The Equity Portfolio's total return for the semi-annual period was 9.50%.
That return consisted of a decrease in net asset value per share of $4.68
(decreasing from $20.56 to $15.88) and income distributions of $0.16 per share
and a large capital gain distribution of $6.36 per share. The Portfolio's
return falls short of the 10.58% total return reported for the Standard &
Poor's 500 Stock Index (the "S&P 500"). The S&P 500 is an unmanaged,
capitalization-weighted index of five hundred publicly traded stocks.
As of July 1, 1997, Kiewit Investment Management Corp., the investment
manager of each Portfolio, agreed to continue its support of the Portfolios'
returns by waiving all or a portion of its advisory fee so that annual
operating expenses will not exceed the following percentages of the average
daily net assets of the Portfolios: Money Market Portfolio 0.20%; Short-Term
Government Portfolio 0.30%; Intermediate-Term Bond Portfolio 0.50%; Tax-Exempt
Portfolio 0.50%; and Equity Portfolio 0.80%. These limitations aided the
competitive returns of each Portfolio.
Market Review and Outlook
The U.S. financial markets rallied strongly during the second half of
1997. The S&P 500 Index posted a 10.58% total return and the Lehman Brothers
Aggregate Bond Index captured a 6.36% total return over the six-month period.
Cash investments provided a stable income return of approximately 2.75% (5.50%
annualized).
During the second half of 1997, interest rates fell 70-80 basis points in
most maturities. Falling inflation, perceptions of deflationary forces from
Asian market turmoil, collapsing commodity prices, a strong U.S. dollar, and a
stable Fed supported the bond market rally. U.S. stocks advanced, albeit with
an October setback, thanks to a healthy U.S. economy, earnings growth, and
falling interest rates. For the year 1997, the S&P 500 Stock Index recorded a
stunning 33.36% total return.
The Federal budget deficit shrunk to a paltry $22 billion during fiscal
year 1997, well below its $107 billion mark from fiscal year 1996.
Consequently, new issuance of U.S. Treasury securities fell sharply. A strong
U.S. dollar and high "real" short-term U.S. interest rates continued to
attract foreign capital. Foreign inflation and foreign interest rates
generally fell during 1997.
Fed policy was stable during the second half of 1997, with the Federal
funds rate held steady at 5.50%. The Fed removed its asymmetric bias to raise
rates at its December meeting. Broad money growth has been strong for two
consecutive years. Recently, narrow money growth has accelerated. This
abundance of liquidity will continue to support economic growth and financial
market advances. Indeed, the inflation created by excess money growth can be
seen in the prices of financial assets.
Looking ahead, 1998 is likely to be a year of solid economic growth with
low inflation. We do not see a U.S. economic recession in the horizon. The
environment for financial assets continues to be good. The U.S. bond market is
likely to post only modest returns during 1998, because a tight labor market
and a strong U.S. stock market will preclude the Fed from any significant
policy eases. We believe that the U.S. equity market is likely to advance
during 1998, providing investors with a total return well above current
expectations. A healthy U.S. economy, low inflation, docile interest rates,
share repurchases, merger/acquisition activity, and excess global liquidity
should support the U.S. stock market.
While our outlook is optimistic, we are cognizant of several dangers.
First, wage pressures may build as 1998 progresses and more jobs are created.
This may lead to higher inflation and higher interest rates. Second, earnings
growth may slow, inhibiting stock market gains. Third, foreign short-term
interest rates are rising as countries attempt to defend their currencies
against further depreciation. This may encourage foreign capital to remain
overseas. Finally, investor optimism is dangerously high (particularly in the
fixed-income arena) and equity market valuations are extended. Much good news
is already "priced into" the U.S. financial markets. Despite these dangers and
the inherent volatility in financial markets, we remain optimistic as long-
term investors.
Sincerely,
/s/ Livingston G. Douglas
Livingston G. Douglas
President
February 25, 1998
* Past performance is not necessarily predictive of future results. There
can be no assurance that the Money Market Portfolio will be able to maintain a
stable net asset value of $1.00. An investment in the Money Market Portfolio
is neither insured nor guaranteed by the U.S. Government.
Kiewit Mutual Fund
- ------------------
Financial Statements
- -----------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1997 (Unaudited)
Short-Term Intermediate- Tax-
Money Market Government Term Bond Exempt Equity
Portfolio Portfolio Portfolio Portfolio Portfolio
Assets:
Investment in Series,
at value* (Note 2)
$521,122,549 $256,651,564 $248,581,325 $157,858,976 $98,263,723
Receivable for investment sold in Series
0 0 2,467 0 0
Receivable for Portfolio shares sold
0 0 0 0 33,598
Unamortized organization costs (Note 2)
11,254 11,254 11,254 11,254 0
Other assets
4,911 1,928 1,401 1,589 586
--------------------------------------------------------------
Total assets
521,138,714 256,664,746 248,596,447 157,871,819 98,297,907
--------------------------------------------------------------
Liabilities:
Dividends payable
2,634,014 1,175,425 1,084,745 530,649 0
Payable for investment purchased in Series
0 0 0 0 33,598
Payable for Portfolio shares redeemed
0 0 2,467 0 0
Accrued management fee (Note 4)
21,613 6,800 6,439 4,984 3,185
Other accrued expenses
23,240 11,154 14,547 10,825 13,766
--------------------------------------------------------------
Total liabilities
2,678,867 1,193,379 1,108,198 546,458 50,549
--------------------------------------------------------------
Net Assets
$518,459,847 $255,471,367 $247,488,249 $157,325,361 $98,247,358
===============================================================
Net Assets consist of:
Shares of beneficial interest
$ 5,184,616 $ 253,356 $ 239,068 $ 153,492 $ 61,885
Additional paid-in capital
513,276,999 254,667,646 245,112,933 156,006,958 105,502,563
Undistributed net investment income
0 0 0 0 14,411
Distributions in excess of net investment income
0 (17,671) (5,497) (69,359) 0
Accumulated net realized (loss) on investment
(1,768) 0 0 0 0
Distributions in excess of net realized gain on investment
0 (59,596) (21,796) (404,263)(12,011,302)
Net unrealized appreciation on investment
0 627,632 2,163,541 1,638,533 4,679,801
--------------------------------------------------------------
Net Assets
$518,459,847 $255,471,367 $247,488,249 $157,325,361 $98,247,358
===============================================================
Shares of beneficial interest outstanding
518,461,615 25,335,588 23,906,824 15,349,249 6,188,498
---------------------------------------------------------------
Net Asset Value, offering and redemption price per share
(Net assets/Outstanding shares of beneficial interest,
$0.01 par value)
$1.00 $10.08 $10.35 $10.25 $15.88
==============================================================
* Cost of investment in the Master
$ 497,229,000 $248,767,587 $239,108,182 $150,863,226 $79,631,123
----------------------------------------------------------------
STATEMENTS OF OPERATIONS
For the Six-Month Period Ended December 31, 1997 (Unaudited)
Short-Term Intermediate- Tax-
Money Market Government Term Bond Exempt Equity
Portfolio Portfolio Portfolio Portfolio Portfolio
Income:
Investment income from Series
$ 16,728,044 $ 4,640,794 $ 4,464,534 $ 3,269,394 $ 782,665
Expenses from Series
(469,015) (191,319) (310,676) (318,727) (352,841)
----------------------------------------------------------------
Total Income
16,259,029 4,449,475 4,153,858 2,950,667 429,824
----------------------------------------------------------------
Expenses:
Administration fee (Note 4)
59,016 15,670 13,992 14,424 9,496
Transfer Agent fee (Note 4)
12,180 11,494 11,373 11,415 10,255
Trustees' fees and expenses (Note 4)
2,468 2,468 2,468 2,468 2,468
Amortization of organizational expenses (Note 2)
3,435 3,435 3,435 3,435 0
Registration fees
28,165 1,308 0 1,147 0
Legal fees
5,759 2,225 1,206 1,517 669
Audit fees
3,506 3,637 3,665 3,657 3,710
Other
6,596 3,479 2,936 3,769 315
---------------------------------------------------------------
Total expenses, net
121,125 43,716 39,075 41,832 26,913
---------------------------------------------------------------
Net investment income
16,137,904 4,405,759 4,114,783 2,908,835 402,911
---------------------------------------------------------------
Net realized and unrealized gain on investments:
Net realized gain (loss) on investment transactions
(497) 474,620 934,647 647,239 12,916,487
Net realized loss on call options written
0 0 0 0 (184,913)
Net change in unrealized appreciation (depreciation)on investments
0 392,306 2,013,138 1,400,058 (4,700,496)
---------------------------------------------------------------
Net gain (loss) on investments
(497) 866,926 2,947,785 2,047,297 8,031,078
---------------------------------------------------------------
Net increase in net assets resulting from operations
$ 16,137,407 $ 5,272,685 $ 7,062,568 $ 4,956,132 $ 8,433,989
================================================================
STATEMENTS OF CHANGES IN NET ASSETS
For the Six-Month Period Ended December 31, 1997 (Unaudited)
Short-Term Intermediate- Tax-
Money Market Government Term Bond Exempt Equity
Portfolio Portfolio Portfolio Portfolio Portfolio
Increase (Decrease) in Net Assets:
Operations:
Net investment income
$ 16,137,904 $ 4,405,759 $ 4,114,783 $ 2,908,835 $ 402,911
Net realized gain (loss) on investment transactions
(497) 474,620 934,647 647,239 12,916,487
Net realized loss on call options written
0 0 0 0 (184,913)
Net change in unrealized appreciation (depreciation)
of investments
0 392,306 2,013,138 1,400,058 (4,700,496)
---------------------------------------------------------------
Net increase in net assets resulting from operations
16,137,407 5,272,685 7,062,568 4,956,132 8,433,989
---------------------------------------------------------------
Distributions to shareholders:
Net investment income
(16,137,904) (4,405,759) (4,114,783) (2,908,835) (697,911)
In excess of net investment income
0 (17,671) (5,497) (69,359) 0
Capital gain
0 (220,230) (600,992) (1,964,425)(27,817,168)
---------------------------------------------------------------
Total distributions
(16,137,904) (4,643,660) (4,721,272) (4,942,619)(28,515,079)
---------------------------------------------------------------
Portfolio share transactions (a):
Receipt from shares sold
1,610,765,166 125,552,314 133,359,928 20,050,000 3,812,760
Receipt from shares issued on reinvestment of distributions
15,295,441 3,842,483 4,045,571 4,907,585 28,253,479
Shares redeemed
(1,522,885,249) (4,046,679) (572,586) (5,548,495)(2,500,532)
----------------------------------------------------------------
Net increase in net assets from Fund share transactions
103,175,358 125,348,118 136,832,913 19,409,090 29,565,707
----------------------------------------------------------------
Total increase in net assets
103,174,861 125,977,143 139,174,209 19,422,603 9,484,617
Net Assets:
Beginning of period
415,284,986 129,494,224 108,314,040 137,902,758 88,762,741
---------------------------------------------------------------
End of period
$518,459,847 $255,471,367 $247,488,249 $157,325,361 $98,247,358
================================================================
(a) Transactions in capital stock were:
Shares sold
1,610,765,166 12,455,740 12,901,959 1,939,556 176,031
Shares issued on reinvestment of distributions
15,295,441 381,452 392,715 477,035 1,809,960
Shares redeemed
(1,522,885,249) (401,064) (55,690) (534,537) (115,762)
----------------------------------------------------------------
Net increase in shares
103,175,358 12,436,128 13,238,984 1,882,054 1,870,229
Shares outstanding - Beginning balance
415,286,257 12,899,460 10,667,840 13,467,195 4,318,269
--------------------------------------------------------------
Shares outstanding - Ending balance
518,461,615 25,335,588 23,906,824 15,349,249 6,188,498
==============================================================
STATEMENTS OF CHANGES IN NET ASSETS
For the Fiscal Year Ended June 30, 1997
Short-Term Intermediate- Tax-
Money Market Government Term Bond Exempt Equity
Portfolio Portfolio Portfolio Portfolio Portfolio
Increase (Decrease) in Net Assets:
Operations:
Net investment income
$ 24,089,839 $ 8,853,004 $ 7,260,811 $ 6,087,570 $ 599,920
Net realized gain on investment transactions
324 193,448 113,893 574,953 1,444,865
Net realized gain on call options written
0 0 0 0 308,968
Net change in unrealized appreciation of investments
0 192,088 1,215,590 1,652,704 15,744,489
--------------------------------------------------------------
Net increase in net assets resulting from operations
24,090,163 9,238,540 8,590,294 8,315,227 18,098,242
--------------------------------------------------------------
Distributions to shareholders:
Net investment income
(24,089,839) (8,853,004) (7,260,811) (6,087,570) (642,027)
In excess of net investment income
0 (58,182) (2,654) (98,764) 0
Capital gain
0 0 0 (173,959) (369,271)
---------------------------------------------------------------
Total distributions
(24,089,839) (8,911,186) (7,263,465) (6,360,293)(1,011,298)
---------------------------------------------------------------
Portfolio share transactions (a):
Receipt from shares sold
2,342,756,681 4,737,101 5,104,754 138 10,320,355
Reinvestment of distributions
23,288,239 9,029,717 7,161,800 6,114,715 1,003,552
Shares redeemed
(2,340,726,795) (67,915,970) (28,230,931) (12,352,098)(5,784,946)
----------------------------------------------------------------
Net increase (decrease) in net assets from
Fund share transactions
25,318,125 (54,149,152) (15,964,377) (6,237,245) 5,538,961
----------------------------------------------------------------
Total increase (decrease) in net assets
25,318,449 (53,821,798) (14,637,548) (4,282,311) 22,625,905
Net Assets:
Beginning of year
389,966,537 183,316,022 122,951,588 142,185,069 66,136,836
----------------------------------------------------------------
End of year
$ 415,284,986 $129,494,224 $108,314,040 $137,902,758 $88,762,741
================================================================
(a) Transactions in capital stock were:
Shares sold
2,342,756,681 471,388 504,187 13 589,643
Shares issued on reinvestment of distributions
23,288,239 900,161 708,701 600,771 55,846
Shares redeemed
(2,340,726,795) (6,763,522) (2,780,361) (1,209,866) (316,887)
----------------------------------------------------------------
Net increase in shares
25,318,125 (5,391,973) (1,567,473) (609,082) 328,602
Shares outstanding - Beginning balance
389,968,132 18,291,433 12,235,313 14,076,277 3,989,667
----------------------------------------------------------------
Shares outstanding - Ending balance
415,286,257 12,899,460 10,667,840 13,467,195 4,318,269
================================================================
Kiewit Mutual Fund
- ------------------
Financial Highlights
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the financial
statements. It should be read in conjunction with the financial statements
and notes thereto.
For the Six-Month For the Period
Period Ended For the Fiscal For the Fiscal July 28,1994+
December 31, 1997 Year Ended Year Ended through
(Unaudited) June 30, 1997 June 30, 1996 June 30, 1995
Money Market Portfolio
Net Asset Value - Beginning of Period
$ 1.00 $ 1.00 $ 1.00 $ 1.00
----------------------------------------------------------------
Investment Operations:
Net investment income
0.03 0.05 0.05 0.05
----------------------------------------------------------------
Distributions:
From net investment income
(0.03) (0.05) (0.05) (0.05)
----------------------------------------------------------------
Net Asset Value - End of Period
$ 1.00 $ 1.00 $ 1.00 $ 1.00
================================================================
Total Return
2.79%1 5.43% 5.61% 5.04%1
Ratios (to average net assets)/Supplemental Data:
Expenses 2
0.20%3 0.20% 0.20% 0.30%3
Net investment income 2
5.47%3 5.31% 5.47% 5.51%3
Net assets at end of period (000)
$ 518,460 $ 415,285 $ 389,967 $ 380,708
For the Six-Month For the Period
Period Ended For the Fiscal For the Fiscal July 29,1994+
December 31, 1997 Year Ended Year Ended through
(Unaudited) June 30, 1997 June 30, 1996 June 30, 1995
Short-Term Government Portfolio
Net Asset Value - Beginning of Period
$ 10.05 $ 10.00 $ 10.15 $ 10.00
----------------------------------------------------------------
Investment Operations:
Net investment income
0.29 0.60 0.60 0.55
Net realized and unrealized gain (loss) on investments
0.04 0.05 (0.15) 0.15
----------------------------------------------------------------
Total from investment operations
0.33 0.65 0.45 0.70
----------------------------------------------------------------
Distributions:
From net investment income
(0.29) (0.60) (0.60) (0.55)
From net realized capital gain
(0.01) - - -
----------------------------------------------------------------
Total distributions
(0.30) (0.60) (0.60) (0.55)
----------------------------------------------------------------
Net Asset Value - End of Period
$ 10.08 $ 10.05 $ 10.00 $ 10.15
================================================================
Total Return
3.26%1 6.51% 4.66% 7.00%1
Ratios (to average net assets)/Supplemental Data:
Expenses 2
0.30%3 0.30% 0.30% 0.37%3
Net investment income 2
5.62%3 5.76% 6.06% 5.75%3
Portfolio turnover
-* -* 57.52% 122.58%3
Net assets at end of period (000)
$ 255,471 $ 129,494 $ 183,316 $ 132,829
+ Commencement of Operations.
1 The total return for the period has not been annualized.
2 The annualized expense ratio for the Money Market Portfolio, had there been
no fees waived by the Manager, would have been 0.30%, 0.27%, 0.27% and 0.34%
for the six-month period ended December 31, 1997, the fiscal years ended June
30, 1997, 1996, and for the period ended June 30, 1995, respectively. The
annualized net investment income ratio for the Money Market Portfolio, had
there been no fees waived by the Manager, would have been 5.37%, 5.24%, 5.40%
and 5.47% for the six-month period ended December 31, 1997, the fiscal years
ended June 30, 1997, 1996 and for the period ended June 30, 1995,
respectively. The annualized expense ratio for the Short-Term Government
Portfolio, had there been no fees waived by the Manager, would have been
0.47%, 0.44%, 0.43% and 0.45% for the six-month ended period December 31,
1977, the fiscal years ended June 30, 1997, 1996, and for the period ended
June 30, 1995, respectively. The annualized net investment income ratio for
the Short-Term Government Portfolio, had there been no fees waived by the
Manager, would have been 5.45%, 5.62%, 5.93% and 5.67% for the six-month
period ended December 31, 1997, the fiscal years ended June 30, 1997, 1996
and for the period ended June 30, 1995, respectively. The expense and net
investment income ratios for the six-month period ended December 31, 1997 and
the fiscal year ending June 30, 1997 include expenses allocated from the
Series. See notes to the Financial Statements for amounts.
3 Annualized.
* See Kiewit Investment Trust's Note 3 to the Financial Statements for
portfolio turnover.
For the Six-Month For the Period
Period Ended For the Fiscal For the Fiscal July 25,1994+
December 31, 1997 Year Ended Year Ended through
(Unaudited) June 30, 1997 June 30, 1996 June 30, 1995
Intermediate - Term Bond Portfolio
Net Asset Value - Beginning of Period
$ 10.15 $ 10.05 $ 10.25 $ 10.00
----------------------------------------------------------------
Investment Operations:
Net investment income
0.31 0.65 0.65 0.60
Net realized and unrealized gain (loss) on investments
0.23 0.10 (0.20) 0.25
----------------------------------------------------------------
Total from investment operations
0.54 0.75 0.45 0.85
----------------------------------------------------------------
Distributions:
From net investment income
(0.31) (0.65) (0.65) (0.60)
From net realized gain
(0.03) - - -
----------------------------------------------------------------
Total distributions
(0.34) (0.65) (0.65) (0.60)
----------------------------------------------------------------
Net Asset Value - End of Period
$ 10.35 $ 10.15 $ 10.05 $ 10.25
================================================================
Total Return
5.29%1 7.51% 4.48% 8.88%1
Ratios (to average net assets)/Supplemental Data:
Expenses 4
0.50%3 0.50% 0.50% 0.41%3
Net investment income 4
5.88%3 6.27% 6.37% 6.41%3
Portfolio turnover
-* -* 86.06% 128.95%3
Net assets at end of period (000)
$247,488 $108,314 $122,952 $105,020
For the Six-Month For the Period
Period Ended For the Fiscal For the Fiscal July 25,1994+
December 31, 1997 Year Ended Year Ended through
(Unaudited) June 30, 1997 June 30, 1996 June 30, 1995
Tax-Exempt Portfolio
Net Asset Value - Beginning of Period
$ 10.25 $ 10.10 $ 10.10 $ 10.00
----------------------------------------------------------------
Investment Operations:
Net investment income
0.21 0.45 0.45 0.40
Net realized and unrealized gain (loss) on investments
0.13 0.16 - 0.10
----------------------------------------------------------------
Total from investment operations
0.34 0.61 0.45 0.50
----------------------------------------------------------------
Distributions:
From net investment income
(0.21) (0.45) (0.45) (0.40)
From net realized capital gain
(0.13) (0.01) - -
----------------------------------------------------------------
Total distributions
(0.34) (0.46) (0.45) (0.40)
----------------------------------------------------------------
Net Asset Value - End of Period
$ 10.25 $ 10.25 $ 10.10 $ 10.10
================================================================
Total Return
3.39%1 6.15% 4.55% 5.23%1
Ratios (to average net assets)/Supplemental Data:
Expenses 4
0.50%3 0.50% 0.50% 0.39%3
Net investment income 4
4.03%3 4.31% 4.47% 4.37%3
Portfolio turnover
-* -* 100.61% 104.34%3
Net assets at end of period (000)
$157,325 $137,903 $142,185 $135,518
+ Commencement of Operations.
1 The total return for the period has not been annualized.
3 Annualized.
4 The annualized expense ratio for the Intermediate-Term Bond Portfolio, had
there been no fees waived by the Manager, would have been 0.58%, 0.58%, 0.57%
and 0.53% for the six-month period ended December 31, 1997, the fiscal years
ended June 30, 1997, 1996, and for the period ended June 30, 1995,
respectively. The annualized net investment income ratio for the
Intermediate-Term Bond Portfolio, had there been no fees waived by the
Manager, would have been 5.80%, 6.19%, 6.30% and 6.29% for the six-month
period ended December 31, 1997, the fiscal years ended June 30, 1997, 1996 and
for the period ended June 30, 1995, respectively. The annualized expense
ratio for the Tax-Exempt Portfolio, had there been no fees waived by the
Manager, would have been 0.58%, 0.55%, 0.54% and 0.50% for the six-month
period ended December 31, 1997, the fiscal years ended June 30, 1997, 1996,
and for the period ended June 30, 1995, respectively. The annualized net
investment income ratio for the Tax-Exempt Portfolio, had there been no fees
waived by the Manager, would have been 3.95%, 4.26%, 4.43% and 4.26% for the
six-month period ended December 31, 1997, the fiscal years ended June 30,
1997, 1996 and for the period ended June 30, 1995, respectively. The expense
and net investment income ratios for the six-month period ended December 31,
1997, the fiscal year ending June 30, 1997 include expenses allocated from the
Series. See Notes to the Financial Statements for amounts.
* See Kiewit Investment Trust's Note 3 to the Financial Statements for
portfolio turnover.
For the Six-Month For the Period
Period Ended For the Fiscal For the Fiscal January 5, 1995+
December 31, 1997 Year Ended Year Ended through
(Unaudited) June 30, 1997 June 30, 1996 June 30, 1995
Equity Portfolio
Net Asset Value - Beginning of Period
$ 20.56 $ 16.58 $ 14.04 $ 12.50
----------------------------------------------------------------
Investment Operations:
Net investment income
0.09 0.13 0.13 0.11
Net realized and unrealized gain (loss) on investments
1.75 4.09 2.56 1.43
----------------------------------------------------------------
Total from investment operations
1.84 4.22 2.69 1.54
----------------------------------------------------------------
Distributions:
From net investment income
(0.16) (0.15) (0.15) -
From net realized capital gain
(6.36) (0.09) - -
---------------------------------------------------------------
Total distributions
(6.52) (0.24) (0.15) -
---------------------------------------------------------------
Net Asset Value - End of Period
$ 15.88 $ 20.56 $ 16.58 $ 14.04
===============================================================
Total Return
9.50%1 25.67% 19.24% 12.32%1
Ratios (to average net assets)/Supplemental Data:
Expenses 6
0.80%3 0.80% 0.80% 0.80%3
Net investment income 6
0.85%3 0.80% 1.34% 3.06%3
Portfolio turnover
-* -* 16.95% 0.00%3
Average commission rate paid
-* -* $0.0637 -
Net assets at end of period (000)
$98,247 $88,763 $66,137 $20,865
+ Commencement of Operations.
1 The total return for the period has not been annualized.
3 Annualized.
6 For the period beginning January 5, 1995 and continuing through December
31, 1997, Kiewit Investment Management Corp. (the "Manager") agreed to waive
all or a portion of its fee in an amount that will limit annual operating
expenses to not more than 0.80% of the average daily net assets of the
Portfolio. The annualized expense ratio, had there been no fees waived by the
Manager, would have been 0.92%, 0.94%, 1.05% and 2.56% for the six-month
period ended December 31, 1997, the fiscal years ended June 30, 1997, 1996,
and for the period ended June 30, 1995, respectively. The annualized net
investment income ratio for the Equity Portfolio, had there been no fees
waived by the Manager, would have been 0.73%, 0.66%, 1.09% and 1.30% for the
six-month period ended December 31, 1997, the fiscal years ended June 30,
1997, 1996 and for the period ended June 30, 1995, respectively. The expense
and net investment income ratios for the six-month period ended December 31,
1997 and the fiscal year ending June 30, 1997 include expenses allocated from
the Series. See Notes to the Financial Statements for amounts.
* See Kiewit Investment Trust's Note 3 to the Financial Statements for
portfolio turnover and average commission rate paid.
Kiewit Mutual Fund
- ------------------
Notes to the Financial Statements (Unaudited)
- -----------------------------------------------------------------
1. Description of the Fund. The Kiewit Mutual Fund (the "Fund") is registered
under the Investment Company Act of 1940 (the "1940 Act"), as an open-end
management investment company organized as a Delaware business trust on June
1, 1994. The Declaration of Trust permits the Trustees to establish additional
series, each of which is a separate class of shares. The Fund comprises six
series of shares: Kiewit Money Market Portfolio, Kiewit Government Money
Market Portfolio, Kiewit Short-Term Government Portfolio, Kiewit Intermediate-
Term Bond Portfolio, Kiewit Tax-Exempt Portfolio, and Kiewit Equity Portfolio
(each, a "Portfolio" and collectively, the "Portfolios"). As of December 31,
1997, the Kiewit Government Money Market Portfolio has not yet commenced
operations. Prior to December 6, 1994, the Fund was known as Kiewit
Institutional Fund.
Effective March 1, 1997, the Portfolios adopted a Master/Feeder
configuration, hereafter referred to as the "Conversion," through the
contribution of the investment securities held as of February 28, 1997 at
market value to a corresponding series of Kiewit Investment Trust (the
"Trust"). In return for the contributed securities, each Portfolio received
an ownership interest of equal value in its corresponding series of the Trust.
The investment objectives of the six Portfolios are as follows: Money Market
Portfolio is high current income, while maintaining a stable share price by
investing in short-term money market securities; Government Money Market
Portfolio is high current income, while maintaining a stable share price by
investing in securities issued or guaranteed by the U.S. Government, its
agencies or instrumentalities; Short-Term Government Portfolio is a high level
of current income, consistent with the maintenance of principal and liquidity;
Intermediate-Term Bond Portfolio is a high level of current income, consistent
with reasonable risk; Tax-Exempt Portfolio is a high level of current income,
exempt from Federal income tax, consistent with reasonable risk; Equity
Portfolio is long-term capital appreciation. Unlike other investment
companies which directly acquire and manage their own portfolio of securities,
each Portfolio seeks to achieve its investment objective by investing all of
its investable assets in a corresponding series of shares of the Trust, an
open-end, management investment company that issues series of shares
(individually and collectively, the "Series") having the same investment
objective, policies and limitations as each of the Portfolios. As of December
31, 1997, each Portfolio owned virtually 100% of the ownership interest in its
corresponding Series. The performance of the Portfolios is directly affected
by the performance of the Series. The financial statements of the Trust,
including the Schedules of Investments, are included elsewhere in this report
and should be read in conjunction with the Fund's Financial Statements.
2. Significant Accounting Policies. The following is a summary of the
significant accounting policies of the Fund:
Security Valuation. Valuation of securities by the Series is discussed in
Note 2 of the Trust's Notes to Financial Statements which are included
elsewhere in this report.
Federal Income Taxes. Each Portfolio is treated as a separate entity for
Federal income tax purposes and each intends to qualify as a regulated
investment company under Subchapter M of the Internal Revenue Code and to
distribute all of its taxable and tax-exempt income to its shareholders.
Therefore, no Federal income tax provision is required. At June 30, 1997, the
Money Market Portfolio, Short- Term Government Portfolio and Intermediate-Term
Bond Portfolio had a net tax basis capital loss carryforward available to
offset future net capital gains of approximately $1,000, $314,000 and
$355,000, respectively, which will expire as follows:
Capital Loss Expiration
Carryforward Date
-----------------------------
Money Market Portfolio $ 1,000 06/30/2004
Short-Term Government Portfolio 102,000 06/30/2003
212,000 06/30/2005
Intermediate-Term Bond Portfolio 355,000 06/30/2003
Interest Income and Distributions to Shareholders. The Portfolios record their
share of the respective Series' income, expenses and realized and unrealized
gains and losses daily. Prior to the Conversion, interest income and expenses
were accrued as earned or incurred. Dividends were recorded on the ex-
dividend date. Additionally, each Portfolio records its own expenses as
incurred. Prior to the Conversion, distributions of net investment income
consisted of accrued interest and earned discount (including both original
issue and market discount) less amortization of premium and accrued expenses.
Distributions to shareholders of each Portfolio, except Kiewit Equity
Portfollio, are declared daily from net investment income and paid to
shareholders monthly. The Fund's policy is to distribute substantially all
net income from the Kiewit Equity Portfolio annually. Distributions of net
capital gains realized by each Portfolio will be made annually.
Deferred Organization Costs. Organization costs incurred by each Portfolio
have been deferred and are being amortized using the straight-line method over
a five-year period beginning on the date that each Portfolio commenced
operations. In the event that any of the initial shares of a Portfolio are
redeemed during the amortization period by any holder thereof, the redemption
proceeds will be reduced by any unamortized organization expenses in the same
proportion as the number of initial shares being redeemed bears to the number
of initial shares outstanding at the time of such redemption.
Use of Estimates in the Preparation of Financial Statements. The preparation
of financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect
the reported amount of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
3. Investment Transactions. During the six-month period ended December 31,
1997, additions and reductions in the respective Series were as follows:
Money Short-Term Intermediate-
Market Government Term Bond Tax-Exempt Equity
--------------------------------------------------------------
Additions
$715,666,357 $125,552,314 $133,317,299 $20,047,517 $3,755,786
Reductions
(628,013,962) (4,322,138) (715,228) (5,586,341) (2,740,851)
4. Management and Administration Fee and Other Transactions with
Affiliates. Prior to the Conversion, the Fund, on behalf of each Portfolio,
employed Kiewit Investment Management Corporation ("KIMC"), an indirect,
wholly-owned subsidiary of Peter Kiewit Sons', Inc., a construction, mining,
energy and telecommunications company, to furnish investment advisory and
other services to the Fund. Pursuant to the Investment Management Agreement
with the Fund with respect to each Portfolio, KIMC managed the investment and
reinvestment of their assets, provided the Fund with records concerning
KIMC's activities which the Fund was required to maintain, and rendered
regular reports to the Fund's officers and the Board of Trustees.
For its services under the Investment Management Agreement for each Portfolio,
KIMC received fees from the Portfolios at the following annual rates of their
average monthly net assets: Money Market Portfolio - 0.20%; Short-Term
Government Portfolio - 0.30%; Intermediate-Term Bond Portfolio - 0.40%; Tax-
Exempt Portfolio - 0.40%; and Equity Portfolio - 0.70%.
Effective March 1, 1997, the Fund's Investment Management Agreement with KIMC
ended and the Fund entered into an Administrative Service Agreement with KIMC.
Pursuant to this agreement, KIMC performs various services, including:
supervision of the services provided by the Portfolio's custodian, transfer
and dividend disbursing agent and others who provide services to the Fund for
the benefit of the Portfolio; providing shareholders with information about
the Portfolio and their investment as they or the Fund may request; assisting
the Portfolio in conducting meetings of the shareholders; furnishing
information as the Board of Trustees may require regarding the corresponding
Series; and any other administrative services for the benefit of the Portfolio
as the Board of Trustees may reasonably request. For its services, each
Portfolio pays KIMC a monthly fee equal to one-twelfth of 0.02% of the
Portfolio's average net assets.
KIMC has agreed to waive all or a portion of its management fee and assume
certain fund expenses in an amount that will limit annual operating expenses
to not more than the following percentage of the average daily net assets of
each Portfolio: Money Market Portfolio - 0.20%; Short-Term Government
Portfolio - 0.30%; Intermediate-Term Bond Portfolio - 0.50%; Tax-Exempt
Portfolio - 0.50%; and Equity Portfolio - 0.80%. These undertakings may be
amended or rescinded at any time in the future.
The following table summarizes the KIMC administration fees for the six-month
period ending December 31, 1997:
Administration
Fee
---------------
Money Market Portfolio 59,016
Short-Term Government Portfolio 15,670
Intermediate-Term Bond Portfolio 13,992
Tax-Exempt Portfolio 14,424
Equity Portfolio 9,496
Rodney Square Management Corp. ("Rodney Square"), a wholly owned subsidiary of
Wilmington Trust Company ("WTC"), which at that time was wholly owned by
Wilmington Trust Corporation, a publicly held bank holding company, formerly
served as Administrator to the Trust and Fund pursuant to separate
Administration Agreements with the Fund and the Trust. As Administrator,
Rodney Square was responsible for services such as financial reporting,
compliance monitoring and corporate management. For the services provided,
Rodney Square received a monthly administration fee from the Trust, on behalf
of each Series. Each Series pays its proportionate share of a complex-wide
annual fee of 0.015% of the Trust's aggregate total average daily net assets
in excess of $125 million. This asset-based fee is determined on a total
average daily net asset basis, and is subject to prescribed fixed minimums.
WTC served as Custodian of the assets of the Fund.
Rodney Square served as Transfer Agent and Dividend Paying Agent of the Fund
pursuant to a separate Transfer Agency Agreement with the Fund on behalf of
each Portfolio. For its services, the Fund paid Rodney Square a monthly fee of
$5,000, plus out-of-pocket expenses.
Rodney Square determined the net asset value per share of each Portfolio and
provides accounting services to the Trust and Fund pursuant to separate
Accounting Services Agreements, with the Fund and the Trust. For its
services, Rodney Square received from the Trust, on behalf of each Series, the
Series' proportionate share of a complex-wide annual fee of 0.015% of the
Trust's aggregate total average daily net assets in excess of $100 million.
This asset-based fee is determined on a total average daily net asset basis,
and is subject to prescribed fixed minimums.
Independent Trustees are each paid an annual fee of $5,000 from the Fund, plus
$250 per Portfolio per meeting attended, plus travel expenses in connection
with meetings. Certain officers and trustees of the Fund are also officers
and/or directors of KIMC.
5. Subsequent Event. RSMC has entered into an agreement with PFPC Inc.
("PFPC") pursuant to which PFPC will acquire the fund accounting,
administration and transfer agent business of RSMC. Effective January 5,
1998, the services previously provided to the Fund by RSMC will be provided by
PFPC at the same rates of compensation that RSMC received.
(The following pages should be read in conjunction with Kiewit Mutual Fund
Semi-Annual Financial Statements)
Kiewit Investment Trust/Money Market Series
- -------------------------------------------
Investments/December 31, 1997 (Unaudited)
(Showing Percentage of Total Value of Net Assets)
- ---------------------------------------------------------------------------
Principal Value
Amount (Note 2)
Commercial Paper - 86.3%
Automobiles - 4.8%
Daimler-Benz North America Corp.,
5.631% - 5.707%, 01/07/98 - 03/10/98 $20,300,000 $20,190,190
Daimler-Benz North America Corp.,
5.732%, 01/14/98 5,000,000 4,989,744
----------
25,179,934
----------
Banks - 8.1%
Abbey National North America Corp.,
5.803%, 03/02/98 5,000,000 4,952,333
Banco De Colombia, S.A., 5.841%, 01/08/98 3,250,000 3,246,335
Commerzbank U.S. Finance, Inc.,
5.608% - 5.737%, 01/14/98 - 01/20/98 15,000,000 14,960,038
Corporacion Andina De Fomento, 5.85%,
02/26/98 5,000,000 4,955,122
U.S. Prime Property Inc., 6.125%, 01/12/98 3,998,000 3,990,548
Westpac Capital Corp., 5.757%, 01/21/98 10,000,000 9,968,333
----------
42,072,709
----------
Business Services - 4.8%
Electronic Data Systems Corp., 5.53% -
5.797%, 02/06/98 - 03/13/98 25,000,000 24,790,721
----------
Chemicals - 4.4%
E.I. Du Pont De Nemours and Co., 5.619% -
5.664%, 02/17/98 - 03/25/98 23,000,000 22,752,369
----------
Computers - 2.9%
CSC Enterprises, 5.944%, 01/29/98 5,000,000 4,977,056
International Business Machines Corp.,
5.783%, 02/12/98 10,000,000 9,933,266
----------
14,910,322
----------
Consumer Staples - 1.9%
Newell Co., 5.739%, 03/05/98 10,000,000 9,900,600
----------
Electronics - 2.9%
General Electric Co., 5.592% - 5.752%,
02/02/98 - 02/10/98 15,000,000 14,917,234
----------
Financial Services - 8.1%
Ford Motor Credit Co., 5.633%, 02/25/98 5,000,000 4,957,833
Ford Motor Credit Co. of Puerto Rico, Inc.,
5.683% - 5.69%, 01/21/98 - 01/28/98 10,000,000 9,963,379
General Electric Capital Corp., 5.716% -
5.734%, 01/08/98 - 03/19/98 10,000,000 9,934,599
General Electric Capital Corp. of
Puerto Rico, 5.644% - 5.692%, 02/03/98 -
02/11/98 11,000,000 10,937,418
Towson Town Center, Inc., 5.843% - 6.434%,
01/16/98 - 01/28/98 6,349,000 6,321,826
----------
42,115,055
----------
Foods - 4.8%
H. J. Heinz Co., 5.808%, 02/17/98 10,000,000 9,924,931
McCormick & Co., Inc., 5.608% - 5.662%,
01/13/98 - 01/15/98 15,000,000 14,970,580
----------
24,895,511
----------
Freight & Shipping - 1.6%
Matson Navigation Co., Inc., 5.762% -
5.765%, 01/28/98 - 01/29/98 9,000,000 8,960,630
----------
Hardware & Tools - 3.5%
Ryobi Finance Corp., 6.804%, 01/28/98 5,700,000 5,671,144
Stanley Works, 5.66% - 5.688%, 02/03/98
- 02/18/98 12,700,000 12,612,255
----------
18,283,399
Leasing - 8.9%
Hertz Corp., 5.826% - 6.061%,
01/08/98 - 03/18/98 $14,233,000 $14,113,040
IBM Credit Corp., 5.625% - 5.731%,
01/15/98 - 03/11/98 17,140,000 17,039,447
International Lease Finance Corp., 5.65%,
02/12/98 5,000,000 4,967,625
Riverside Funding, Inc., 6.029%, 01/30/98 10,085,000 10,036,662
----------
46,156,774
----------
Machinery & Heavy Equipment - 2.9%
Dover Corp., 5.808% - 5.824%,
02/04/98 - 02/11/98 15,000,000 14,911,942
----------
Oil - 7.2%
Arco British Ltd., 5.873%, 01/29/98 3,119,000 3,104,857
Chevron Oil Finance Co., 5.764%, 01/29/98 8,000,000 7,964,533
Chevron Transport Corp., 5.658% - 5.67%,
01/27/98 - 02/24/98 13,000,000 12,913,250
Chevron U.K. Investment plc, 5.788%,
06/11/98 4,000,000 3,899,286
Petroleo Brasileiro S.A., 5.814%, 03/04/98 10,000,000 9,901,317
----------
37,783,243
----------
Pharmaceuticals Preparations - 0.9%
American Home Products Corp., 5.79%,
03/12/98 5,000,000 4,944,486
----------
Printing & Publishing - 5.0%
Knight-Ridder, Inc., 5.731% - 5.891%,
01/22/98 - 03/25/98 11,000,000 10,913,364
R.R. Donnelley & Sons Co., 5.743%,
02/10/98 6,450,000 6,409,293
The Dun & Bradstreet Corp., 5.809% - 5.887%,
01/12/98 - 03/19/98 9,000,000 8,942,297
----------
26,264,954
----------
Retail Merchandising - 2.6%
HD Real Estate Funding, Inc., 5.642%,
01/05/98 6,573,000 6,568,918
Nordstrom Credit, Inc., 5.899%, 01/16/98 6,770,000 6,753,442
----------
13,322,360
----------
Securities Dealers - 5.1%
Merrill Lynch & Co., Inc., 5.68% - 5.765%,
02/02/98 - 03/31/98 27,000,000 26,747,248
----------
Technology - 4.0%
EG&G, Inc., 5.847% - 6.08%,
01/13/98 - 01/27/98 21,000,000 20,929,161
----------
Utilities - 1.9%
AT&T Corp., 5.639% - 5.76%, 02/04/98 -
03/05/98 10,000,000 9,924,200
----------
Total Commercial Paper (Cost $449,762,852) 449,762,852
-----------
Student Loan Marketing Association Notes - 1.1%
Student Loan Marketing Assoc. Notes,
5.62%, 09/28/98 (Cost $5,956,997)* 5,960,000 5,956,997
----------
Repurchase Agreement - 12.6%
With Paine Webber Group, Inc: at 6.80% dated
12/31/97, to be repurchased at $65,725,820
on 01/02/98, collateralized by Government
National Mortgage Association securities at
various rates and maturities to 10/20/27
(market value $67,016,769) (Cost $65,701,000) 65,701,000
----------
Value
(Note 2)
Total Investments (Cost $521,420,849)+ - 100.0% $521,420,849
Other Assets and Liabilities, Net - 0.0% (197,632)
------------
Net Assets - 100.0% $521,223,217
============
+ Cost for Federal income tax purposes and financial reporting purposes.
* Denotes a variable or floating rate note. Variable and floating rate notes
are instruments whose rates change periodically. The rates shown are as of
December 31, 1997.
Kiewit Investment Trust/Short-Term Government Series
- ----------------------------------------------------
Investments/December 31, 1997 (Unaudited)
(Showing Percentage of Total Value of Net Assets)
- ----------------------------------------------------------------------------
Principal Value
Amount (Note 2)
Federal National Mortgage Association Notes - 9.3%
Federal National Mtge. Assoc. Notes,
6.20% - 9.05%, 04/10/00 - 09/07/00
(Cost $23,739,533) $23,545,000 $23,816,290
-----------
U.S. Treasury Notes - 88.5%
U.S. Treasury Notes, 5.625% - 7.75%,
11/30/98 - 11/30/00 (Cost 226,745,526) 224,500,000 227,296,469
-----------
Repurchase Agreement - 0.5%
With CS First Boston Group, Inc.: at
6.50% dated 12/31/97, to be repurchased at
$1,359,491 on 01/02/98, collateralized by
Federal National Mortgage Association
securities at various rates and maturities
to 09/01/27 (market value $1,417,413)
(Cost $1,359,000) 1,359,000
-----------
Total Investments (Cost $251,844,059) - 98.3% 252,471,759
Other Assets and Liabilities, Net - 1.7% 4,255,383
-----------
Net Assets - 100.0% $256,727,142
============
+ Cost for Federal income tax purposes was $251,953,490. At December 31,
1997, net unrealized appreciation was $518,269. This consisted of aggregate
gross unrealized appreciation for all securities in which there was an excess
of market value over tax cost of $520,490 and aggregate gross unrealized
depreciation for all securities in which there was an excess of tax cost over
market value of $2,221.
Kiewit Investment Trust/Intermediate-Term Bond Series
Investments/December 31, 1997 (Unaudited)
(Showing Percentage of Total Value of Net Assets
- -----------------------------------------------------------------------------
Moody's/S&P Principal Value
Rating Amount (Note 2)
----------- --------- --------
Corporate Bonds - 23.3%
Automobile Manufacturing - 1.2%
Ford Motor Co., 8.875%, 04/01/06 A1/A $2,500,000 $2,890,625
----------
Banks - 1.7%
ABN-Amro Bank - Global Note, 7.55%,
06/28/06 Aa2/AA- 2,000,000 2,140,000
National City Corp., 6.625%, 03/01/04 A2/A- 1,015,000 1,026,419
Star Bank, N.A., 6.375%, 03/01/04 A3/A- 1,000,000 1,000,000
----------
4,166,419
----------
Consumer Goods - 0.4%
Seagram, Joseph E. & Sons, Inc., 8.375%,
02/15/07 A2/A 1,000,000 1,132,500
----------
Electric Utilities - 0.8%
Consolidated Edison, 6.45%, 12/01/07 A1/A+ 1,000,000 1,001,250
Texas Utilities Electric, 8.125%, 02/01/02 Baa1/BBB+ 1,000,000 1,063,750
----------
2,065,000
----------
Financial - 2.6%
Countrywide Home Loan, 7.45%, 09/16/03 A3/A 1,000,000 1,048,750
Household Finance Co., 7.25%, 07/15/03 A2/A 1,000,000 1,040,000
Travelers, Inc., 8.625%, 02/01/07 Aa3/AA- 1,000,000 1,145,000
United Postal Savings Assoc., 9.00%,
07/26/99 Aaa/NR 3,000,000 3,131,250
----------
6,365,000
----------
Foreign - 2.4%
Hanson Overseas B.V., 7.375%, 01/15/03 A3/A- 3,000,000 3,138,750
Quebec Province, 8.80%, 04/15/03 A2/A+ 1,000,000 1,108,750
WMC Finance USA, 6.50%, 11/15/03 A2/A 1,600,000 1,626,000
----------
5,873,500
----------
Insurance - 1.2%
Lincoln National Corp., 7.25%, 05/15/05 A2/A 2,850,000 2,985,375
----------
Manufacturing - 5.7%
Air Products & Chemicals, 8.50%, 04/01/06 A2/A 3,000,000 3,333,750
Consolidated Coal - Medium Term Note,
8.21%, 06/21/04 A2/A- 3,250,000 3,536,552
Dayton Hudson Co., 6.40%, 02/15/03 Baa1/BBB+ 1,000,000 997,500
EG & G, Inc., 6.80%, 10/15/05 Baa2/A 2,500,000 2,565,625
Hoechst-Celanese Corp., 6.125%, 02/01/04 A2/A+ 1,000,000 992,500
Monsanto Co., 8.13%, 12/15/06 A1/A 2,500,000 2,728,175
----------
14,154,102
----------
Merchandising & Retail - 1.7%
Mercantile Stores, Inc., 6.70%, 09/15/02 A1/A+ 3,200,000 3,200,000
Penney, (J.C.) Co., Inc., 6.125%,
12/30/99 A2/A 1,000,000 990,000
----------
4,190,000
----------
Security & Commodity Brokers, Dealers - 2.7%
Bear Stearns Company, Inc., 6.50%,
08/01/02 A2/A 1,000,000 1,005,000
Lehman Brothers Holdings, Inc., 7.25%,
10/15/03 Baa1/A 3,000,000 3,105,000
Morgan Stanley Group, Inc., 7.50%,
09/01/99 A1/A+ 1,000,000 1,023,750
Salomon, Inc., 7.75%, 05/15/00 Baa1/BBB 1,500,000 1,550,625
----------
6,684,375
----------
Telephone & Communications - 0.4%
Pacific Bell, 6.25%, 03/01/05 A1/AA- $1,000,000 $ 995,000
----------
Transportation - 2.5%
Canadian National Railway Co., 6.625%,
05/15/03 Baa2/BBB 3,000,000 3,026,250
Hertz Corp., 7%, 05/01/02 A3/BBB+ 1,000,000 1,016,250
Union Pacific Corp., 6.12%, 02/01/04 Aa3/A 2,280,000 2,260,050
----------
6,302,550
----------
TOTAL CORPORATE BONDS (COST $56,345,454) 57,804,446
----------
Federal National Mortgage Association Notes
- - 4.0%
Federal National Mtge. Assoc. Notes,
6.20%, 06/26/00 NR/NR 9,250,000 9,323,630
Federal National Mtge. Assoc. Notes,
7.65%, 03/10/05 NR/NR 500,000 547,830
---------
TOTAL FEDERAL NATIONAL MORTGAGE ASSOCIATION
NOTES (Cost $9,813,016) 9,871,460
---------
U.S. Treasury Obligations - 71.2%
U.S. Treasury Bonds, 10.375%, 11/15/12 NR/NR 7,100,000 9,433,272
U.S. Treasury Notes, 5.625% - 7.875%,
01/15/99 - 02/15/06 NR/NR 165,800,000 167,690,991
-----------
TOTAL U.S. Treasury Obligations (Cost $176,477,969) 177,124,263
-----------
Repurchase Agreement - 0.2%
With Paine Webber Group, Inc.: At 6.80%
dated 12/31/97, to be repurchased at
$545,216 on 01/02/98, collateralized by
a Government National Mortgage Association
security with a rate of 7.50% and maturity
of 11/20/27 (Market value $557,242)
(COST $545,000) 545,000
------------
TOTAL INVESTMENTS (COST $243,181,439) - 98.7% 245,345,169
OTHER ASSETS AND LIABILITIES, NET - 1.3% 3,311,869
-----------
NET ASSETS - 100.0% $248,657,038
============
+ Cost for Federal income tax purposes was $243,153,834. At December 31,
1997, net unrealized appreciation was $2,191,335. This consisted of aggregate
gross realized appreciation for all securities in which there was an excess of
market value over tax cost of $2,221,599 and aggregate gross unrealized
depreciation for all securities in which there was an excess of tax cost over
market value of $30,264.
NR Not Rated. While not rated by Moody's or S&P, U.S. Government Agency
Obligations and Mortgage Backed Securities are considered to be of the highest
quality, comparable to AAA.
Kiewit Investment Trust/Tax-Exempt Series
Investments/December 31, 1997 (Unaudited)
(Showing Percentage of Total Value of Net Assets)
- -----------------------------------------------------------------------------
Moody's/S&P Principal Value
Rating Amount (Note 2)
----------- --------- --------
Municipal Bonds - 97.9%
Alabama - 0.2%
Univ. of South Alabama (Hosp. &
Auxiliary Rev.), 4.75%, 05/15/10,
Callable 05/15/04 @ 102 Sinking Fund Aaa/AAA $350,000 $350,437
----------
Arizona - 2.8%
Arizona State, AZ Trans. Board Highway
Rev., 6.50%, 07/01/11, Prerefunded
07/01/01 @ 101.50 Sinking Fund Aaa/AA 2,000,000 2,177,500
Scottsdale, AZ Ind. Dev. Auth. Hosp.
Rev. (Scottsdale Memorial Hosp.),
Ser. A, 6.50%, 09/01/03 Aaa/AAA 2,000,000 2,210,000
---------
4,387,500
---------
California - 7.7%
California Health Fac. Fin. Auth. Rev.,
CA (Childrens Hosp. Los Angeles-A),
7.125%, 06/01/21, Prerefunded
06/01/01 @ 102 Sinking Fund 06/01/04 Aaa/A+ 2,000,000 2,232,500
California State Public Works Brd. Lease
Rev. (California State University),
Ser. C, 5.00%, 10/01/01 A2/A 3,500,000 3,618,125
California State Public Works Brd.,
6.40%, 12/01/16, Prerefunded 12/01/02
@ 102 Sinking Fund Aaa/AAA 1,000,000 1,115,000
Contra Costa County Hosp., CA, 6.625%,
11/01/22, Prerefunded 11/01/02 @ 102
Sinking Fund Aaa/A+P 2,000,000 2,247,500
Laguna Beach, CA Gen. Oblig., 6.60%,
08/15/09, Callable 08/15/01 @ 102 Aa/AA 1,230,000 1,344,968
San Francisco, CA (City & County Public
Safety Imp. Proj.), Ser. 1990C, 6.10%,
06/15/06, Prerefunded 06/15/00 @ 102 A1/AA- 1,510,000 1,610,038
----------
12,168,131
----------
Colorado - 0.8%
Adams County, CO Ref. (School Dist. No.
012), 5.10%, 12/15/03 Aaa/AAA 1,230,000 1,286,888
---------
Florida - 8.7%
Dade County, FL Sales Tax Rev., 6.00%,
10/01/01 Aaa/AAA 2,500,000 2,665,625
Florida State Department of Trans.,
6.40%, 07/01/02 Aa2/AA+ 1,270,000 1,387,475
Miami-Dade County, FL Gen. Oblig., Ser.
C, 4.94%, 10/01/03 Aaa/AAA 1,315,000 1,020,769
Orange County, FL Solid Waste Fac. Rev.,
6.375%, 10/01/07, Callable 10/01/02 @
102 Sinking Fund Aaa/AAA 4,910,000 5,419,412
Orlando & Orange County, FL Expressway
Auth. Rev., 5.097%, 07/01/04, Callable
07/01/03 @ 102* Aaa/AAA 3,200,000 3,315,872
----------
13,809,153
----------
Georgia - 1.4%
Georgia State, GA Gen. Oblig., Ser. F,
6.50%, 12/01/01 Aaa/AAA 1,000,000 1,091,250
Georgia State, GA Gen. Oblig., Ser. D,
5.90%, 11/01/03 Aaa/AAA 1,000,000 1,093,750
----------
2,185,000
----------
Hawaii - 4.1%
Hawaii State Gen. Oblig., Ser. BV, 6.00%,
11/01/04, Prerefunded 11/01/01 @ 101 Aaa/AAA 1,000,000 1,076,250
Honolulu, HI City & County Gen. Oblig.,
4.70%, 10/01/00 Aa2/AA 2,000,000 2,032,500
Honolulu, HI City & County Gen. Oblig.,
5.50%, 01/01/04 Aa/AA 1,600,000 1,698,000
Honolulu, HI City & County Gen. Oblig.,
5.40%, 04/01/05 Aa/AA 1,500,000 1,595,625
----------
6,402,375
----------
Illinois - 7.5%
Chicago, IL Metropolitan Water
Reclamation Dist., 4.30%, 12/01/01 Aa2/AA $1,965,000 $1,987,106
Chicago, IL Tax Increment, 4.50%,
06/01/04 Aaa/AAA 2,500,000 2,515,625
Evanston, IL Gen. Oblig., 6.10%,
12/01/09, Prerefunded 12/01/02 @ 100 Aaa/NR 1,000,000 1,081,250
Illinois State Health Fac. Auth. (LA
Grange Memorial Hosp.), 5.50%, 05/15/23,
Prerefunded 05/15/03 @ 102 Aaa/AAA 2,445,000 2,628,375
Illinois State Gen. Oblig., 5.50%,
08/01/04 Aa3/AA 1,250,000 1,331,250
Illinois State Toll Highway Priority Rev.
Ref., Ser. A, 3.50%, 01/01/05, Callable
01/01/03 @ 100 A1/A 2,500,000 2,340,625
----------
11,884,231
----------
Indiana - 0.7%
Highland, IN School Bldg. Corp., 6.75%,
07/15/12, Prerefunded 01/15/02 @ 102
Sinking Fund NR/AAA 1,000,000 1,108,750
----------
Maryland - 1.9%
Maryland State Dept. Trans. Rev. Bond,
4.375%, 12/15/03, Callable 12/15/02
@ 101 Aa/AA 3,000,000 3,026,250
----------
Massachusetts - 2.3%
Massachusetts State Gen. Oblig., Ser. B,
6.50%, 06/01/13, Prerefunded 06/01/02
@ 101 Sinking Fund Aaa/A+ 1,000,000 1,100,000
Massachusetts Bay Transit Auth., Ser. C,
6.10%, 03/01/23, Prerefunded 03/01/02
@ 102 Rising Fund Aaa/AAA 2,265,000 2,466,019
----------
3,566,019
----------
Michigan - 1.8%
Michigan Municipal Bond Auth. Rev.,
6.95%, 05/15/11, Partially Prerefunded
05/15/01 @ 102 Aa/AA 1,575,000 1,732,500
Western Michigan Univ. Rev., 6.50%,
07/15/21, Prerefunded 07/15/01 @ 102
Sinking Fund Aaa/AAA 1,000,000 1,095,000
----------
2,827,500
----------
Minnesota - 3.9%
Minnesota State Gen. Oblig., 4.75%,
05/01/01 Aaa/AA+ 5,000,000 5,112,500
Minnesota State Gen. Oblig., 4.90%,
08/01/01 Aaa/AAA 1,000,000 1,031,250
----------
6,143,750
----------
Mississippi - 1.3%
Jackson, MS Public School Dist., 5.90%,
07/01/03, Callable 07/01/02 @ 100 A1/AA- 2,000,000 2,120,000
----------
Nebraska - 9.0%
Douglas County, NE Zoo Fac. Rev. (Henry
Doorly Zoo Aquarium Proj.), 6.00%,
06/01/03, Callable 06/01/97 @ 100 NR/NR 4,250,000 4,252,423
Douglas County, NE Hosp. Auth. No. 2
(Catholic Health-Archbishop Mercy),
7.25%, 11/01/21, Prerefunded 11/01/01
@ 102 Sinking Fund NR/AA- 4,350,000 4,888,312
Lancaster County, NE Hosp. Auth. No. 1
(Sisters of Charity), 6.375%, 05/15/05,
Callable 05/15/01 @ 102 Aaa/AAA 2,530,000 2,732,400
Lincoln, NE Electric Systems Rev., Ser.
A, 4.50%, 09/01/01 Aa/AA 1,170,000 1,187,550
Omaha, NE Gen. Oblig., 4.75%, 12/01/01 Aaa/AAA 1,070,000 1,099,425
----------
14,160,110
----------
New Jersey - 3.3%
New Jersey State Gen. Oblig., Ser. E,
6.00%, 07/15/03 Aa1/AA+ $1,895,000 $2,065,550
Newark, NJ School Qualified Board Act,
5.30%, 09/01/03 Aaa/AAA 2,000,000 2,110,000
Union County, NJ Gen. Oblig., 4.50%,
12/15/01 Aaa/AA+ 1,050,000 1,071,000
----------
5,246,550
----------
New Mexico - 1.3%
New Mexico State Severance Tax, Ser.
A, 5.50%, 07/01/01 Aa2/AA 2,027,000 2,115,681
----------
New York - 10.4%
Metropolitan Trans. Auth., NY Commuter
Fac. Rev., 6.50%, 07/01/24,
Prerefunded 07/01/04 @ 101.50 Sinking
Fund 07/01/19 Baa1/BBB+ 1,500,000 1,696,875
Municipal Assistance Corp. For New York
City, Ser. H, 5.25%, 07/01/03 Aa2/AA- 3,125,000 3,289,063
New York City, NY Gen. Oblig., Ser. F,
5.25%, 08/01/04 Baa1/BBB+ 5,000,000 5,156,250
New York State Rev. Bond, 5.25%,
04/01/03 Baa1/BBB 2,000,000 2,072,500
New York, NY Gen. Oblig., Ser. D, 5.25%,
08/01/03 Baa1/BBB+ 2,000,000 2,062,500
New York, NY Trans Fin Auth., 5.00%,
08/15/04 Aa3/NA 2,000,000 2,087,500
----------
16,364,688
----------
North Carolina - 1.3%
Mecklenburg County, NC Gen. Oblig.,
5.60%, 03/01/01 Aaa/AAA 2,000,000 2,095,000
----------
Ohio - 3.4%
Lucas County, OH Hosp. Rev. Bond (St.
Vincent Medical Center), 6.625%,
08/15/22, Prerefunded 08/15/02 @
102 Sinking Fund Aaa/AAA 3,000,000 3,307,500
Ohio State Public Fac. Rev. Bond, Ser.
II-B, 4.50%, 11/01/03 Aa3/AA- 2,000,000 2,027,500
----------
5,335,000
----------
Oklahoma - 3.9%
Tulsa County, OK Independent School
Dist. No. 1 Gen. Oblig., 5.00%,
02/01/01 Aa/NR 1,000,000 1,027,500
Tulsa, OK Gen. Oblig., 5.125%,
05/01/03 Aa2/AA 2,000,000 2,085,000
Tulsa, OK Gen. Oblig., Ser. B, 6.20%,
12/01/03, Callable 12/01/01 @ 100 Aa/AA 2,840,000 3,038,800
----------
6,151,300
----------
Oregon - 0.7%
Portland City, OR Sewer Sys. Rev.,
6.25%, 06/01/15, Prerefunded
06/01/04 @ 101 Sinking Fund A1/A+ 1,000,000 1,112,500
----------
Pennsylvania - 4.1%
Bethlehem, PA Auth. Water Rev. Bond,
6.25%, 11/15/21, Prerefunded 11/15/01
@ 100 Sinking Fund Aaa/AAA 1,000,000 1,073,750
Pennsylvania State Gen. Oblig., Ser. A,
6.10%, 11/15/03, Prerefunded 11/15/01
@ 101.50 Aaa/AAA 1,960,000 2,119,250
Philadelphia, PA School Dist. Gen.
Oblig., Ser. B, 5.00%, 04/01/02 Aaa/AAA 1,000,000 1,033,750
Philadelphia, PA School Dist. Gen.
Oblig., 5.00%, 04/01/04 Aaa/AAA 1,125,000 1,167,188
Pittsburgh, PA Water & Sewer Auth. Rev.
Bond, Ser. A, 6.50%, 09/01/24,
Prerefunded 09/01/01 @ 102 Aaa/AAA 1,050,000 1,151,062
----------
6,545,000
----------
South Carolina - 5.8%
South Carolina State Gen. Oblig., Ser.
A, 5.75%, 03/01/03 Aaa/AAA $3,585,000 $3,853,875
South Carolina State Public Service Auth.
Rev., 6.00%, 07/01/31, Sinkable 07/01/27
@100 Aa2/AA- 5,000,000 5,300,000
----------
9,153,875
----------
Texas - 5.8%
Arlington, TX Gen. Oblig., 6.00%,
08/15/03 Aaa/AA3 1,700,000 1,842,375
Dallas County, TX Gen. Oblig., 6.00%,
08/15/01 Aaa/AAA 1,000,000 1,065,000
Dallas County, TX Gen. Oblig., 6.30%,
08/15/02, Callable 02/15/01 @ 100 Aaa/AAA 1,000,000 1,062,500
Houston, TX Independent School Dist. Gen.
Oblig., 6.375%, 08/15/01 Aaa/AAA 3,925,000 4,219,375
Texas A & M Univ. Gen. Oblig., Ser. C,
5.10%, 07/01/01 Aaa/AAA 1,000,000 1,037,500
----------
9,226,750
----------
Utah - 0.9%
Intermountain Power Agency Power Supply
Rev. Ref., Ser. C, 5.00%, 07/01/04,
Callable 07/01/03 @102 Aa/A+ 1,390,000 1,429,962
----------
Virginia - 0.7%
Fairfax County, VA Gen. Oblig., Ser. A,
5.40%, 06/01/07, Callable 06/01/02
@ 102 Aaa/AAA 1,000,000 1,056,250
----------
Washington - 0.7%
King County, WA Gen. Oblig., 4.95%,
12/01/01 Aa1/AA+ 1,000,000 1,032,500
----------
Wisconsin - 1.5%
Milwaukee, WI Gen. Oblig., Ser. G, 5.50%,
06/15/03 Aa1/AA+ 2,305,000 2,444,061
----------
TOTAL MUNICIPAL BONDS (COST $153,096,279) 154,735,211
-----------
Tax-Exempt Mutual Fund - 4.0%
Federated Tax Free Oblig. Fund Institutional
Shares (Cost $6,277,418) NR/NR 6,277,418 6,277,418
----------
TOTAL INVESTMENTS (COST $159,373,697) - 101.9% 161,012,629
OTHER ASSETS AND LIABILITIES, NET - (1.9%) (3,077,869)
-----------
NET ASSETS - 100.0% $157,934,760
===========
+ Cost for Federal income tax purposes was $159,017,989. At December 31,
1997, net unrealized appreciation was $1,994,640. This consisted of aggregate
gross realized appreciation for all securities in which there was an excess of
market value over tax cost of $2,012,992 and aggregate gross unrealized
depreciation for all securities in which there was an excess of tax cost over
market value of $18,352.
NR Not Rated. While not rated by Moody's or S&P, the Fund adviser considers
the security to be of the appropriate quality for the Trust.
Kiewit Investment Trust/Equity Series
Investments/December 31, 1997 (Unaudited)
(Showing Percentage of Total Value of Net Assets)
- -----------------------------------------------------------------------------
Value
Shares (Note 2)
---------- --------
COMMON STOCK - 99.1%
COMMUNICATIONS & BROADCASTING - 8.8%
AT&T Corp. 22,000 $1,347,500
Airtouch Communications, Inc.* 6,900 286,781
Alltel Corp. 2,600 106,763
Ameritech Corp. 7,500 603,750
Bell Atlantic Corp. 10,500 955,500
Bellsouth Corp. 13,400 754,587
CBS Corp. 8,700 256,106
Clear Channel Communications, Inc.* 1,300 103,269
Comcast Corp. (Special A Shares)* 4,700 148,344
GTE Corp. 12,900 674,025
MCI Communications Corp. 9,300 398,156
SBC Communications, Inc. 12,400 908,300
Sprint Corp. 5,800 340,025
Tele-Communications, Inc. 6,900 192,769
Time Warner Inc. 7,600 471,200
U.S. West Media Group 8,200 236,775
US West Communications Group 6,400 288,800
Viacom, Inc. (B Shares) 4,800 198,900
Worldcom, Inc. * 12,200 369,050
----------
TOTAL COMMUNICATIONS & BROADCASTING 8,640,600
----------
FINANCE & INSURANCE - 21.4%
Hospital & Medical Service Plans - 0.8%
Aetna Inc. 2,000 141,125
Columbia/HCA Healthcare Corp. 8,800 260,700
Healthsouth Corp.* 4,600 127,650
Tenet Healthcare Corp.* 4,100 135,812
United Healthcare Corp. 2,600 129,187
----------
794,474
----------
Insurance Carriers - 4.9%
Allstate Corp. 5,800 527,075
American General Corp. 3,400 183,812
American International Group, Inc. 9,500 1,033,125
Aon Corp. 2,300 134,837
Chubb Corp. 2,400 181,500
Cigna Corp. 1,000 173,063
Conseco, Inc. 2,600 118,138
General Re Corp. 1,100 233,200
Hartford Financial Services Group, Inc. 1,600 149,700
Lincoln National Corp. 1,300 101,562
Loews Corp. 1,500 159,188
MGIC Investment Corp. 1,500 99,750
Marsh & McLennan Companies, Inc. 2,300 171,494
Progressive Corp. 1,000 119,875
Safeco Corp. 1,700 82,875
St. Paul Companies, Inc. 1,100 90,269
SunAmerica, Inc. 2,700 115,425
Torchmark Corp. 1,800 75,712
Transamerica Corp. 800 85,200
Travelers Group, Inc. 15,423 830,914
UNUM Corp. 1,800 97,875
----------
4,764,589
----------
Value
Shares (Note 2)
---------- --------
Savings, Credit & Other Financial Institutions - 2.3%
American Express Co. 6,300 $562,275
Fannie Mae 14,300 815,994
Federal Home Loan Mtge. Corp. 9,400 394,212
Green Tree Financial Corp. 1,800 47,138
H.F. Ahmanson & Co. 1,300 87,019
Household Intl., Inc. 1,400 178,587
Washington Mutual, Inc. 3,400 216,963
----------
2,302,188
----------
Security & Commodity Brokers, Dealers & Services - 4.7%
Charles Schwab Corp. 3,600 150,975
Merrill Lynch & Co., Inc. 4,500 328,219
Morgan Stanley, Dean Witter, Discover, and Co. 8,000 473,000
Standard & Poor's Depositary Receipt 37,900 3,673,931
----------
4,626,125
----------
State & National Banks - 8.7%
Banc One Corp. 7,900 429,069
BankAmerica Corp. 9,400 686,200
BankBoston Corp. 1,900 178,481
Bankers Trust New York Corp. 1,300 146,169
Barnett Banks, Inc. 2,700 194,062
Chase Manhattan Corp. 5,700 624,150
Citicorp 6,100 771,269
Comerica, Inc. 1,400 126,350
Corestates Financial Corp. 2,800 224,175
Fifth Third Bancorp 2,000 163,500
First Chicago NBD Corp. 4,000 334,000
First Union Corp. 7,600 389,500
Fleet Financial Group, Inc. 3,400 254,788
Huntington Bancshares, Inc. 2,100 75,600
J.P. Morgan & Co., Inc. 2,500 282,188
Keycorp 3,000 212,437
MBNA Corp. 6,750 184,359
Mellon Bank Corp. 3,400 206,125
National City Corp. 2,900 190,675
Nationsbank Corp. 9,600 583,800
Norwest Corp. 10,000 386,250
PNC Bank Corp. 4,200 239,663
Republic New York Corp. 700 79,931
State Street Corp. 2,100 122,194
Suntrust Banks, Inc. 2,900 206,987
The Bank of New York Co., Inc. 5,100 294,844
U.S. Bancorp 3,300 369,394
Wachovia Corp. 2,100 170,361
Wells Fargo & Co. 1,200 407,325
----------
8,533,846
----------
TOTAL FINANCE & INSURANCE 21,021,222
----------
MANUFACTURING - 53.2%
Aircraft & Aerospace - 1.2%
Allied Signal Inc. 7,700 299,819
General Dynamics Corp. 800 69,150
Lockheed Martin Corp. 2,700 265,950
Northrop Grumman Corp. 900 $103,500
Raytheon Co. (A Shares) 624 30,771
Raytheon Co. (B Shares) 3,200 161,600
United Technologies Corp. 3,200 233,000
----------
1,163,790
----------
Chemicals & Allied Products - 2.1%
Air Products and Chemicals, Inc. 1,400 115,150
Dow Chemical Co. 3,100 314,650
Du Pont (E.I.) de Nemours & Co. 15,300 918,956
Monsanto Co. 8,000 336,000
PPG Industries, Inc. 2,500 142,812
Praxair, Inc. 2,100 94,500
Rohm & Haas Co. 800 76,600
Union Carbide Corp. 1,600 68,700
----------
2,067,368
----------
Computer & Office Equipment - 8.6%
3Com Corp. 4,700 164,206
Bay Networks, Inc. 2,700 69,019
Cabletron Systems, Inc. 2,100 31,500
Cisco Systems, Inc.* 13,500 752,625
Compaq Computer Corp. 10,200 575,662
Digital Equipment Corp. 2,000 74,000
EMC Corp. 6,800 186,575
Hewlett-Packard Co. 14,000 875,000
Intel Corp. 22,100 1,552,525
International Business Machines Corp. 13,300 1,390,681
Micron Technology, Inc. 2,900 75,400
Microsoft Corp.* 16,200 2,093,850
Pitney Bowes, Inc. 1,900 170,882
Seagate Technology 3,300 63,525
Xerox Corp. ( Rights Attached) 4,400 324,775
----------
8,400,225
----------
Consumer Products - 4.3%
Avon Products, Inc. 1,700 104,337
Clorox Co. 1,400 110,687
Colgate-Palmolive Co. 4,000 294,000
Fortune Brands, Inc. 2,400 88,950
Gillette Co. 7,700 773,369
International Flavors & Fragrances, Inc. 1,400 72,100
Kimberly-Clark Corp. 7,600 374,775
Newell Co. 2,100 89,250
Procter & Gamble Co. 18,200 1,452,588
Ralston-Ralston Purina Group 1,400 130,112
The Unilever Group 8,400 524,475
WM. Wrigley Jr. Co. 1,500 119,344
----------
4,133,987
----------
Food & Beverage - 5.8%
Anheuser Busch Companies, Inc. 6,700 294,800
Archer-Daniels-Midland Co. 7,600 164,825
Bestfoods 1,900 204,725
Campbell Soup Co. 6,200 360,375
Coca Cola Co. 33,600 2,238,600
ConAgra, Inc. 6,400 210,000
General Mills, Inc. 2,100 $150,413
Heinz (H.J.) Co. 5,000 254,063
Hershey Foods Corp. 1,900 117,681
Kellogg Co. 5,500 272,938
Pepsico, Inc. 20,700 754,256
Quaker Oats Co. 1,800 94,950
Sara Lee Corp. 6,400 360,400
Sysco Corp. 2,400 109,350
The Seagram Co., Ltd. 5,000 161,562
----------
5,748,938
----------
Games & Toys - 0.1%
Mattel, Inc. 3,900 145,275
----------
Misc. Electrical Machinery, Equip. & Supplies - 4.8%
AMP, Inc. 3,000 126,000
Applied Materials, Inc.* 5,000 150,625
Emerson Electric Co. 6,000 338,625
General Electric Co. 44,200 3,243,175
Honeywell, Inc. 1,700 116,450
Motorola, Inc. 8,100 462,206
National Semiconductor Corp.* 1,900 49,281
Texas Instruments, Inc. 5,200 234,000
----------
4,720,362
----------
Misc. Industrial Machinery & Equip. - 1.1%
Caterpillar, Inc. 5,100 247,669
Cooper Industries, Inc. 1,600 78,400
Deere & Co. 3,400 198,263
Dover Corp. 3,000 108,375
Eaton Corp. 1,000 89,250
Illinois Tool Works, Inc. 3,400 204,424
Ingersoll-Rand Co. 2,300 93,150
Thermo Electron Corp.* 2,000 89,000
----------
1,108,531
----------
Miscellaneous Manufacturing Industries - 1.4%
Allegheny Teledyne, Inc. 2,400 62,100
Corning, Inc. 3,100 115,087
Crown Cork & Seal Co., Inc. 1,700 85,212
Masco Corp. 2,300 117,013
Minnesota Mining & Manufacturing Co. 5,600 459,550
Nike, Inc. (B Shares) 3,900 153,074
Tenneco, Inc. 2,300 90,850
Tyco International Ltd. 7,200 324,450
----------
1,407,336
----------
Oil Field Machinery & Equipment - 0.9%
Baker Hughes, Inc. 2,300 100,338
Dresser Industries, Inc. 2,400 100,650
Halliburton Co. 3,400 176,587
Schlumberger, Ltd. 6,700 539,350
----------
916,925
----------
Value
Shares (Note 2)
------ --------
Paper & Paper Products - 0.6%
Champion International Corp. 1,300 $58,906
Fort James Corp. 2,600 99,450
Georgia Pacific Corp. (Timber Group) 1,200 27,225
Georgia Pacific Corp. 1,200 72,900
International Paper Co. 4,100 176,813
Weyerhaeuser Co. 2,700 132,469
----------
567,763
----------
Petroleum Refining - 4.2%
Amoco Corp. 6,700 570,338
Coastal Corp. 1,400 86,713
Exxon Corp. 33,500 2,049,781
Mobil Corp. 10,600 765,187
Occidental Petroleum 4,500 131,906
Texaco, Inc. 7,200 391,500
USX - Marathon Group 3,900 131,625
----------
4,127,050
----------
Pharmaceutical Preparations - 9.6%
Abbott Laboratories 10,400 681,850
American Home Products Corp. 8,800 673,200
Amgen, Inc. 3,600 194,850
Bristol-Myers Squibb Co. 13,500 1,277,437
Eli Lilly and Co. 15,000 1,044,375
Johnson & Johnson 18,000 1,185,750
Merck & Co., Inc. 16,300 1,731,875
Pfizer, Inc. 17,500 1,304,844
Pharmacia & Upjohn, Inc. 6,900 252,712
Schering-Plough Corp. 9,900 615,038
Warner-Lambert Co. 3,700 458,800
----------
9,420,731
----------
Photographic Equipment & Supplies - 0.3%
Eastman Kodak Co. 4,400 267,575
----------
Precision Instruments & Medical Supplies - 0.9%
Baxter International, Inc. 3,800 191,663
Becton, Dickinson & Company 1,600 80,000
Boston Scientific Corp. 2,700 123,863
Guidant Corp. 2,000 124,500
KLA-Tencor Corp. 1,100 42,487
Medtronic, Inc. 6,300 329,569
----------
892,082
----------
Printing & Publishing - 0.5%
Gannett Co., Inc. 3,800 234,888
McGraw-Hill Companies, Inc. 1,300 96,200
The Times Mirror Co. 1,300 79,950
Tribune Co. 1,600 99,600
----------
510,638
----------
Rubber & Plastics - 0.1%
Goodyear Tire & Rubber Co. 2,100 133,612
----------
Value
Shares (Note 2)
---------- --------
Telecommunications Equipment - 1.2%
Lucent Technologies, Inc. 8,700 $694,912
Northern Telecom Ltd. 3,600 320,400
Tellabs, Inc. 2,500 132,188
----------
1,147,500
----------
Textiles & Apparel - 0.1%
VF Corp. 1,600 73,500
----------
Tobacco - 1.6%
Philip Morris Cos., Inc. 32,800 1,486,250
UST, Inc. 2,500 92,344
----------
1,578,594
----------
Transportation - 1.0%
AMR Corp.* 1,200 154,200
Burlington Northern Santa Fe 2,100 195,169
CSX Corp. 3,000 162,000
Delta Air Lines, Inc. (Preferred Rights Attached) 1,000 119,000
Norfolk Southern Corp. 5,100 157,145
Union Pacific Corp. 3,400 212,288
----------
999,802
----------
Transportation Equipment - 2.8%
Boeing Co. 13,500 660,657
Chrysler Corp. 9,100 320,206
Ford Motor Co. 16,200 788,737
General Motors Corp. 9,800 594,125
Rockwell International Corp. 2,900 151,525
Textron, Inc. 2,300 143,750
TRW Inc. 1,600 85,400
----------
2,744,400
----------
TOTAL MANUFACTURING 52,275,984
----------
Mining - 3.6%
Aluminum - 0.2%
Alcan Aluminum Ltd. 3,100 85,637
Aluminum Co. of America 2,400 168,900
----------
254,537
----------
Crude Petroleum & Natural Gas - 3.2%
Amerada Hess Co. 1,200 65,850
Atlantic Richfield Co. 4,300 344,538
Burlington Resources, Inc. 1,600 71,700
Chevron Corp. 8,800 677,600
Philips Petroleum Co. 3,600 175,050
Royal Dutch Petroleum Co. 29,000 1,571,437
Union Pacific Resources Group, Inc. 3,500 84,875
Unocal Corp. 3,400 131,963
----------
3,123,013
----------
Value
Shares (Note 2)
---------- --------
Miscellaneous Metal Ores - 0.2%
Barrick Gold Corp. 5,000 $93,125
Freeport-McMoran Copper & Gold, Inc. 2,700 42,525
Newmont Mining Corp. 2,100 61,688
----------
197,338
----------
TOTAL MINING 3,574,888
----------
Agriculture - 0.1%
Pioneer Hi-Bred International, Inc. 1,100 117,975
----------
Services - 4.3%
Amusement & Recreation Services - 0.9%
Walt Disney Co. 9,100 901,469
----------
Business Services - 1.1%
Automatic Data Processing, Inc. 4,000 245,500
Cendant Corp.* 10,547 362,536
Federal Express Corp. 1,500 91,593
First Data Corp. 6,000 175,500
MBIA, Inc. 1,200 80,175
The Interpublic Group of Companies, Inc. 1,600 79,700
----------
1,035,004
----------
Computer Services - 1.6%
Cognizant Corp. 2,300 102,494
Computer Associates International, Inc. 7,350 388,631
Computer Sciences Corp. 1,000 83,500
Dell Computer Corp. 4,500 378,000
Oracle Systems Corp.* 13,200 294,525
Parametric Tech Co.* 1,700 80,537
Sun Microsystems, Inc. 5,000 199,375
----------
1,527,062
----------
Hotels, Other Lodging Places - 0.3%
Hilton Hotels Corp. 3,400 101,150
ITT Corp. 1,500 124,312
Marriott International, Inc. 1,700 117,725
----------
343,187
----------
Personal Services - 0.1%
Service Corp. International 3,400 125,588
----------
Sanitary Services - 0.3%
Browning-Ferris Industries, Inc. 2,900 107,300
Waste Management, Inc. 6,100 167,750
----------
275,050
----------
TOTAL SERVICES 4,207,360
----------
Utilities - 2.6%
American Electric Power Co. 2,600 134,225
Carolina Power & Light Co. 2,000 84,875
Cinergy Corp. 2,100 80,456
Consolidated Edison Co. of New York, Inc. 3,200 $131,200
Consolidated Natural Gas Co. 1,300 78,650
Dominion Resources, Inc. 2,600 110,662
Duke Energy Corp. 4,900 271,338
Edison International 5,300 144,094
Enron Corp. 4,100 170,406
Entergy Corp. 3,300 98,794
FPL Group, Inc. 2,500 147,969
Houston Industries, Inc. 3,900 104,081
Pacificorp 4,000 109,250
Peco Energy Co. 2,800 67,900
PG&E Corp. 5,900 179,581
Public Service Enterprise Group, Inc. 3,200 101,400
Southern Co. 9,200 238,050
Texas Utilities Co. 3,300 137,156
The Williams Co., Inc. 4,200 119,176
Unicom Corp. 3,000 92,250
----------
Total Utilities 2,601,513
----------
Wholesale & Retail Trade - 5.1%
Miscellaneous Retail Stores - 2.0%
Costco Companies, Inc. 2,900 129,413
CVS Corp. 2,400 153,750
Genuine Parts Co. 2,500 84,844
Rite Aid Corp. 1,600 93,900
Toys `R' Us, Inc. 3,900 122,606
Wal-Mart Stores, Inc. 30,600 1,206,788
Walgreen Co. 6,700 210,212
----------
2,001,513
----------
Retail Apparel & Accessory Stores - 0.4%
Gap, Inc. 5,400 191,362
The Limited, Inc. 3,700 94,350
TJX Companies, Inc. 2,000 68,750
----------
354,462
----------
Retail Building Materials - 0.7%
Home Depot, Inc. 9,800 576,975
Lowe's Companies, Inc. 2,400 114,450
----------
691,425
----------
Retail Department Stores - 1.0%
Dayton Hudson Corp. 3,000 202,500
Federated Department Stores, Inc. 2,900 124,881
Kmart Corp. 6,600 76,312
May Department Stores Co. 3,200 168,600
Penney (J.C.) Co., Inc. 3,400 205,063
Sears, Roebuck & Co. 5,300 239,825
----------
1,017,181
----------
Retail Eating & Drinking Places - 0.5%
McDonald's Corp. 9,300 444,075
Tricon Global Restaurants, Inc. 2,070 60,159
----------
504,234
----------
Value
Shares (Note 2)
---------- --------
Retail Food Stores - 0.4%
Albertson's, Inc. 3,300 $156,338
American Stores Co. 3,700 76,081
Kroger Co. 3,500 129,281
----------
361,700
----------
Wholesale Chemicals & Drugs - 0.1%
Cardinal Health, Inc. 1,400 105,177
----------
TOTAL WHOLESALE & RETAIL TRADE 5,035,692
----------
Total Common Stock (Cost $92,794,475) $97,475,234
----------
REPURCHASE AGREEMENTS - 0.9%
With Paine Webber Group, Inc.: At 6.80%, dated 12/31/97,
to be repurchased at $847,320 on 01/02/98, collateralized by
a Government National Mortgage Association security with a
rate of 7.50% and a maturity of 11/20/27 (market value
$863,981)
(COST $847,000) 847,000
----------
TOTAL INVESTMENTS
(COST $93,641,475) - 100.0% 98,322,234
OTHER ASSETS AND LIABILITIES, NET - 0.0% 17,702
----------
NET ASSETS - 100.0% $98,339,936
==========
* Non-income producing security.
+ Cost for Federal income tax purposes was $91,984,866. At December 31,
1997, net unrealized appreciation was $6,337,368. This consisted of aggregate
gross unrealized appreciation for all securities in which there was an excess
of market value over tax cost of $10,442,547and aggregate gross unrealized
depreciation for all securities in which there was an excess of tax cost over
market value of $4,105,179.
Kiewit Investment Trust
- -----------------------
Financial Statements
- -----------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1997 (Unaudited)
Assets:
Investments in securities, at value* (Note 2)
Cash
Receivable for beneficial interests sold
Dividends and interest receivable
Other assets
Total assets
Liabilities:
Payable for beneficial interests repurchased
Payable for investment securities purchased
Accrued management fee (Note 4)
Other accrued expenses (Note 4)
Total liabilities
Net Assets
*Investments at cost
Short-Term
Money Market Government Intermediate-Term Tax-Exempt Equity
Series Series Bond Series Series Series
------------ ------------ ----------------- ---------- ------
$521,420,849 $252,471,759 $245,345,169 $161,012,629 $98,322,234
586 394 709 98 327
0 0 0 0 33,598
16,045 4,356,004 3,492,753 2,198,184 142,898
73 26 22 28 16
------------ ------------ ------------ ------------ -----------
521,437,553 256,828,183 248,838,653 163,210,939 98,499,073
------------ ------------ ------------ ------------ -----------
0 0 2,467 0 0
0 0 0 5,125,300 0
158,147 65,276 145,084 119,527 140,733
56,189 35,765 34,064 31,352 18,404
------------ ------------ ------------ ------------ -----------
214,336 101,041 181,615 5,276,179 159,137
------------ ------------ ------------ ------------ -----------
$521,223,217 $256,727,142 $248,657,038 $157,934,760 $98,339,936
============ ============ ============ ============ ===========
$521,420,849 $251,844,059 $243,181,439 $159,373,697 $93,641,475
------------ ------------ ------------ ------------ -----------
STATEMENTS OF OPERATIONS
For the Six-Month Period Ended December 31, 1997 (Unaudited)
Income:
Dividends
Interest
Total income
Expenses:
Management fee (reflects waiver*) (Note 4)
Administration fee (Note 4)
Accounting fee (Note 4)
Custodian fee (Note 4)
Trustees' fees and expenses (Note 4)
Legal
Audit
Other
Total expenses, net
Net investment income
Net realized and unrealized gain (loss) on investments:
Net realized gain (loss) on investment transactions
Net realized gain on call options written
Net change in unrealized appreciation investments
Net gain on investments
Net increase in net assets resulting from operations
*Management fee waiver
Short-Term
Money Market Government Intermediate-Term Tax-Exempt Equity
Series Series Bond Series Series Series
------------ ------------ ----------------- ---------- ------
$ 0 $ 0 $ 0 $ 0 $ 659,764
16,728,714 4,641,301 4,465,061 3,269,787 123,053
------------ ------------ ------------ ------------ -----------
16,728,714 4,641,301 4,465,061 3,269,787 782,817
------------ ------------ ------------ ------------ -----------
293,852 100,832 224,385 231,864 275,733
64,618 35,683 34,570 34,819 31,534
60,568 30,903 29,760 30,023 26,654
29,318 10,621 9,017 7,631 7,817
2,468 2,468 2,468 2,468 2,468
3,771 1,260 894 1,136 618
6,240 6,240 6,240 6,240 6,240
8,199 3,332 3,379 4,584 1,846
------------ ------------ ------------ ------------ -----------
469,034 191,339 310,713 318,765 352,910
------------ ------------ ------------ ------------ -----------
16,259,680 4,449,962 4,154,348 2,951,022 429,907
------------ ------------ ------------ ------------ -----------
(498) 474,625 934,661 647,257 12,916,650
0 0 0 0 (184,915)
0 392,372 2,013,324 1,400,455 (4,699,657)
------------ ------------ ------------ ------------ -----------
(498) 866,997 2,947,985 2,047,712 8,032,078
------------ ------------ ------------ ------------ -----------
$16,259,182 $5,316,959 $7,102,333 $4,998,734 $8,461,985
============ ============ ============ ============ ===========
$ (297,732) $ (134,809) $ (56,186) $ (57,191) $ (57,298)
STATEMENTS OF CHANGES IN NET ASSETS
For the Six-Month Period Ended December 31, 1997 (Unaudited)
Increase (Decrease) in Net Assets:
Operations:
Net investment income
Net realized gain (loss) on investment transactions
Net realized gain on call options written
Net change in unrealized appreciation of investments
Net increase in net assets resulting from operations
Transactions in beneficial interests:
Contributions
Withdrawals
Net increase in net assets from transactions in interests
Total increase in net assets
Net Assets:
Beginning of period
End of period
Short-Term
Money Market Government Intermediate-Term Tax-Exempt Equity
Series Series Bond Series Series Series
------------ ------------ ----------------- ---------- ------
$16,259,680 $ 4,449,962 $ 4,154,348 $ 2,951,022 $ 429,907
(498) 474,625 934,661 647,257 12,916,650
0 0 0 0 (184,915)
0 392,372 2,013,324 1,400,455 4,699,657)
------------ ------------ ------------ ------------ -----------
16,259,182 5,316,959 7,102,333 4,998,734 8,461,985
------------ ------------ ------------ ------------ -----------
715,765,357 125,626,314 133,391,299 20,121,517 3,829,786
(628,013,962) (4,322,138) (715,228) (5,586,341) (2,740,851)
------------ ------------ ------------ ------------ -----------
87,751,395 121,304,176 132,676,071 14,535,176 1,088,935
------------ ------------ ------------ ------------ -----------
104,010,577 126,621,135 139,778,404 19,533,910 9,550,920
------------ ------------ ------------ ------------ -----------
417,212,640 130,106,007 108,878,634 138,400,850 88,789,016
------------ ------------ ------------ ------------ -----------
$521,223,217 $256,727,142 $248,657,038 $157,934,760 $98,339,936
============ ============ ============ ============ ============
STATEMENTS OF CHANGES IN NET ASSETS
For the Period March 1, 1997 (Commencement of Operations) through June 30,
1997
Increase (Decrease) in Net Assets:
Operations:
Net investment income
Net realized gain (loss) on investment transactions
Net realized gain on call options written
Net change in unrealized appreciation of investments
Net increase in net assets resulting from operations
Transactions in beneficial interests:
Contributions
Withdrawals
Net increase in net assets from transactions in interests
Total increase in net assets
Net Assets:
Beginning of period
End of period
Short-Term
Money Market Government Intermediate-Term Tax-Exempt Equity
Series Series Bond Series Series Series
------------ ------------ ----------------- ---------- ------
$ 7,635,035 $ 2,439,031 $ 2,279,895 $ 1,947,232 $ 219,132
0 (106,763) (58,777) (187,909) 263,311
0 0 0 0 308,968
0 235,328 150,405 238,477 9,380,417
------------ ------------ ------------ ------------ -----------
7,635,035 2,567,596 2,371,523 1,997,800 10,171,828
------------ ------------ ------------ ------------ -----------
684,043,333 133,963,166 107,263,591 138,877,680 81,691,510
(274,465,728) (6,424,755) (756,480) (2,474,630) (3,074,322)
------------ ------------ ------------ ------------ -----------
409,577,605 127,538,411 106,507,111 136,403,050 78,617,188
------------ ------------ ------------ ------------ -----------
417,212,640 130,106,007 108,878,634 138,400,850 88,789,016
------------ ------------ ------------ ------------ -----------
0 0 0 0 0
------------ ------------ ------------ ------------ -----------
$417,212,640 $130,106,007 $108,878,634 $138,400,850 $88,789,016
============ ============ ============ ============ ===========
Kiewit Investment Trust
- -----------------------
Notes to the Financial Statements (Unaudited)
- -----------------------------------------------------------------------------
1. Description of the Trust. The Kiewit Investment Trust (the "Trust") is
registered under the Investment Company Act of 1940 (the "1940 Act"), as an
open-end management investment company organized as a Delaware business trust
on January 23, 1997. The Declaration of Trust permits the Trustees to
establish additional series, each of which is a separate class of shares. The
Trust comprises six series of shares: Kiewit Money Market Series, Kiewit
Government Money Market Series, Kiewit Short-Term Government Series, Kiewit
Intermediate-Term Bond Series, Kiewit Tax-Exempt Series, and Kiewit Equity
Series (individually and collectively referred to as "Series"). As of
December 31, 1997, the Kiewit Government Money Market Series has not yet
commenced operations. The investment objectives of the six Series are as
follows: Money Market Series is high current income, while maintaining a
stable share price by investing in short-term money market securities;
Government Money Market Series is high current income, while maintaining a
stable share price by investing in securities issued or guaranteed by the U.S
Government, its agencies or instrumentalities; Short-Term Government Series is
a high level of current income, consistent with the maintenance of principal
and liquidity; Intermediate-Term Bond Series is a high level of current
income, consistent with reasonable risk; Tax-Exempt Series is a high level of
current income, exempt from Federal income tax, consistent with reasonable
risk; Equity Series is long-term capital appreciation.
The Trust commenced operations on March 1, 1997. Each Series of the Trust
received a contribution of investment securities from a corresponding
Portfolio of Kiewit Mutual Fund (the "Fund") in exchange for an ownership
interest in the Series of equal value.
2. Significant Accounting Policies. The following is a summary of the
significant accounting policies of the Trust:
Security Valuation. Securities held by the Series which are listed on a
securities exchange and for which market quotations are available are valued
at the last quoted sale price of the day or, if there is no such reported
sale, securities are valued at the mean between the most recent quoted bid and
asked prices. Price information for listed securities is taken from the
exchange where the security is primarily traded. Unlisted securities for
which market quotations are readily available are valued at the most recent
bid prices. The Money Market Series values securities utilizing the amortized
cost valuation method which is permitted under Rule 2a-7 under the 1940 Act.
This method involves valuing a portfolio security initially at its cost and
thereafter adjusting for amortization of premium or accretion of discount to
maturity. Each money market instrument with a remaining maturity of 60 days
or less is valued at amortized cost, which approximates market value, unless
the Trust's Board of Trustees determines that this does not represent fair
value. The value of other assets and securities for which no quotations are
readily available (including restricted securities) are determined in good
faith at fair value in accordance with procedures adopted by the Board of
Trustees.
Federal Income Taxes. Each Series is treated as a partnership entity for
Federal income tax purposes. Any interest, dividends and gains or losses of a
Series will be deemed to have been "passed through" to each partner. It is
intended that each Series' assets will be managed in such a way that the
investor in the Series will satisfy requirements of Subchapter M of the
Internal Revenue Code.
Investment Income. All of the net investment income (loss) and realized and
unrealized gains and losses from the security transactions are allocated pro
rata among the investors in the Series on a daily basis.
Use of Estimates in the Preparation of Financial Statements. The preparation
of financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect
the reported amount of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Repurchase Agreements. Each Series, through the Trust's custodian, receives
delivery of the underlying securities used to collateralize the repurchase
agreements, the market value of which is required to be in an amount at least
equal to 102% of the resale price. Kiewit Investment Management Corp.
("KIMC"), the Trust Manager, is responsible for determining that the market
value of these underlying securities is maintained at a level at least equal
to 102% of the resale price. In the event of default of the obligation to
repurchase, the Trust has the right to liquidate the collateral and apply the
proceeds in satisfaction of the obligation. Provisions of each agreement
ensure that the market value of the collateral is sufficient in the event of
default; however, in the event of default or bankruptcy by the other party to
the agreement, realization and/or retention of the collateral may be subject
to legal proceedings.
Call and Put Options. The Short-Term Government Series, Intermediate-Term
Bond Series and the Equity Series each may write and/or purchase exchange-
traded call options and purchase exchange-traded put options on securities in
the Series. When a Series writes a call option, an amount equal to the
premium received is reflected as a liability. The amount of the liability is
subsequently "marked to market" to reflect the current market value of the
option written. If an option which a Series has written either expires on its
stipulated expiration date, or if a Series enters into a closing purchase
transaction, the Series realizes a gain (or loss if the cost of the closing
transaction exceeds the premium received when the option is sold), and the
liability related to such option is extinguished. If a call option which a
Series has written is exercised, the Series realizes a gain or loss from the
sale of the underlying security, and the proceeds from which are increased by
the premium originally received.
Other. Investment security transactions are accounted for on a trade date
basis. Each Series uses the specific identification method for determining
realized gain and loss on investments for both financial and Federal income
tax reporting purposes.
3. Investment Securities. During the six month period ended December 31,
1997, purchases and sales of investment securities (excluding short-term
investments) aggregated as follows:
Short-Term Intermediate-
Government Term Bond Tax-Exempt Equity
------------ ------------ ------------ -----------
Purchases $267,171,209 $212,880,304 $115,466,414 $86,526,484
Sales 108,821,184 65,760,795 96,513,061 78,103,225
Resulting in a
Combined portfolio
Turnover rate as
Follows 78.11% 51.76% 71.98% 86.79%
Portfolio Turnover rate
for the fiscal year
ended June 30, 1997 44.24% 51.57% 62.70% 26.33%
Written options transactions for the Equity Series during the six-month period
ended December 31, 1997 are summarized as follows:
Call Options Written
Premiums Received
--------------------
Options outstanding, beginning of period $(19,624)
Options written (93,109)
Options closed 82,397
Options exercised 30,336
Options expired 0
--------
Options outstanding at December 31, 1997 $ 0
========
During the six-month period ended December 31, 1997, the Short-Term Government
Series and the Intermediate-Term Bond Series had not entered into any option
contracts.
The average commission rate paid by the Equity Series, for the six-month
period ended December 31, 1997 and the fiscal year ended June 30, 1997 was
$0.0331 and $0.0563 respectively.
4. Management Fee and Other Transactions with Affiliates. The Trust, on
behalf of each Series, employs KIMC, an indirect, wholly-owned subsidiary of
Peter Kiewit Sons', Inc., a construction, mining, energy and
telecommunications company, to furnish investment advisory and other services
to the Trust. Pursuant to an investment management agreement with the Trust
with respect to each Series, KIMC manages the investment and reinvestment of
their assets, provides the Trust with records concerning KIMC's activities
which the Trust is required to maintain, and renders regular reports to the
Trust officers and the Board of Trustees.
For its services under the investment management agreement for each Series,
KIMC receives fees from the Series at the following annual rates of their
average monthly net assets: Money Market Series - 0.20%; Short-Term
Government Series - 0.30%; Intermediate-Term Bond Series - 0.40%; Tax-Exempt
Series - 0.40%; and Equity Series - 0.70%.
KIMC has agreed to waive all or a portion of its management fee and assume
certain fund expenses in an amount that will limit annual operating expenses
to not more than the following percentage of the average daily net assets of
each Kiewit Mutual Fund: Money Market Portfolio - 0.20%; Short-Term Government
Portfolio - 0.30%; Intermediate-Term Bond Portfolio - 0.50%; Tax-Exempt
Portfolio - 0.50%; and Equity Portfolio - 0.80%. These undertakings may be
amended or rescinded at any time in the future.
The following table summarizes the management fees for the six-month period
ended December 31, 1997:
Gross Management Management
Fee Fees Waived
---------------- -----------
Money Market Series $591,584 $297,732
Short-Term Government Series 235,641 134,809
Intermediate-Term Bond Series 280,571 56,186
Tax-Exempt Series 289,055 57,191
Equity Series 333,031 57,298
Rodney Square Management Corp. ("Rodney Square"), a wholly owned subsidiary of
Wilmington Trust Company ("WTC"), which at that time was wholly owned by
Wilmington Trust Corporation, a publicly held bank holding company, formerly
served as Administrator to the Trust pursuant to an Administration Agreement
with the Trust on behalf of each Series. As Administrator, Rodney Square was
responsible for services such as financial reporting, compliance monitoring
and corporate management. For the services provided, Rodney Square received a
monthly administration fee from the Trust at an annual rate of $50,000 per
Series, plus an amount equal to 0.015% of that portion of the Series' total
average daily net assets in excess of $125 million, plus out-of-pocket
expenses.
WTC served as Custodian of the assets of the Trust.
Rodney Square determined the net asset value of each Series and provides
accounting services to the Trust pursuant to an Accounting Services Agreement
with the Trust on behalf of each Series. For its services, Rodney Square
received an annual fee of $40,000 per Series, plus an amount equal to 0.015%
of that portion of the Series' total average daily net assets in excess of
$100 million.
Independent Trustees are each paid an annual fee of $5,000 from the Trust,
plus $250 per Series per meeting attended, plus travel expenses in connection
with meetings. Certain officers and trustees of the Trust are also officers
and/or directors of KIMC.
5. Subsequent Event. RSMC has entered into an agreement with PFPC Inc.
("PFPC") pursuant to which PFPC will acquire the fund accounting,
administration and transfer agent business of RSMC. Effective January 5,
1998, the services previously provided to the Trust by RSMC will be provided
by PFPC at the same rates of compensation that RSMC received.
