<PAGE>
SEMI-ANNUAL REPORT
State Farm Balanced Fund, Inc.
ONE STATE FARM PLAZA . BLOOMINGTON, ILLINOIS 61710
For Account Information and Shareowner
Services: (309) 766-2029
For Price Information ONLY:
1-800/447-0740
May 31, 1995
This report is not to be distributed unless preceded or accompanied by a
prospectus.
<PAGE>
STATE FARM BALANCED FUND, INC.
Dear Shareowner:
Financial markets have exhibited extraordinary strength over the past six
months. General common stock prices and share values of the Balanced Fund have
been moving regularly to record highs in 1995. The S&P 500 Index, which tends
to be the most widely followed of the broadly based stock market indexes,
produced total returns of 19.1% and 20.1% respectively for the past six and
twelve months. Fortunately the common stock portfolio of the Balanced Fund has
kept pace by yielding a total return which exceeded that of the S&P 500 Index
for the last twelve months despite lagging the Index for the past six months.
The value of the Fund's fixed income portfolio also improved significantly
over the past six months, but, as should be expected, not as much as the stock
portfolio. The total return for your entire Fund was 12.7% since last November
and 15.9% since May, 1994.
The recent dramatic improvement in common stock prices coincides with
significant declines in interest rates. It seems that we are now reaching a
point where simultaneous strength in the stock and bond markets is less
likely. The current level of bond prices looks to be anticipating a marked
general economic slowdown, while strength in the stock market signals
expectations of continuing good business conditions.
Virtually all the economic data which has been released over the past
couple months or so indicates that a slowdown of some sort is now in progress.
Nobody really knows whether this is a pause in a long expansion or a pause
which presages a serious general decline. Since many of the telltale signs of
identifiable problems or excesses which typically accompany major declines in
the economy are not presently evident, we tend to believe the slowdown will be
moderate and short. However, the economy is probably slowing enough to
restrict the growth in earnings at some companies to levels which will be
below investors' expectations. Since stock prices have been supported by
vigorous growth in corporate earnings over the past couple years, developments
along these lines may cause difficulties for some stock prices given present
valuations.
Of course uncertainty always exists, but we are probably in the midst of a
period where conditions are somewhat more unsettled than they have been so far
in this business cycle which began about four years ago. Larger, and perhaps
more frequent fluctuations, in financial markets are the likely byproduct of
these circumstances. We remind you that returns of good quality,
equity-oriented portfolios, such as the portfolio of the Balanced Fund, tend
to be lumpy. Periods which provide particularly good returns are inevitably
offset to some degree by times when flat or negative results occur. Focusing
on long term results, please be prepared to tolerate this volatility -
history tells us it is the price one pays to achieve returns which exceed
those provided by fixed income investments.
The directors have declared a semi-annual dividend of $.605 per Balanced
Fund share which will be used to purchase additional shares for your account
at the net asset value at the close of business on June 30, 1995 unless you
have elected to receive payment directly by check.
Sincerely,
Kurt G. Moser Paul N. Eckley
Vice President Vice President
June 16, 1995
<PAGE>
STATE FARM BALANCED FUND, INC.
PORTFOLIO OF INVESTMENTS
MAY 31, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
SHARES VALUE
<C> <S> <C>
COMMON STOCKS (60.4%)
AGRICULTURAL PRODUCTS (5.3%):
668,442 Archer-Daniels-Midland Company....................................... $ 12,366,177
155,000 Kellogg Company...................................................... 10,404,375
------------
22,770,552
BANKS (6.3%):
137,280 Bancorp Hawaii, Inc. ................................................ 4,152,720
118,481 Banponce Corporation................................................. 4,102,405
212,000 Norwest Corporation.................................................. 6,015,500
155,000 PNC Bank Corp........................................................ 4,185,000
229,000 Wachovia Corporation ................................................ 8,673,375
------------
27,129,000
CHEMICALS (6.4%):
185,000 Air Products and Chemicals, Inc. .................................... 9,828,125
120,000 Great Lakes Chemical Corporation..................................... 7,320,000
120,000 International Flavors & Fragrances Inc............................... 5,910,000
103,500 Sigma-Aldrich Corporation............................................ 4,554,000
------------
27,612,125
COMMUNICATIONS (8.5%):
170,000 AT&T Corp............................................................ 8,627,500
125,000 Capital Cities/ABC, Inc.............................................. 12,062,500
21,000 Lee Enterprises, Incorporated........................................ 795,375
21,000 Lee Enterprises, Incorporated, Class B............................... 795,375
261,000 MCI Communications Corporation....................................... 5,285,250
200,000 Reuters Holdings PLC (ADR)........................................... 8,975,000
------------
36,541,000
COMPUTERS AND OTHER OFFICE
EQUIPMENT (4.6%):
200,000 Hewlett-Packard Company.............................................. 13,225,000
80,000 Hon Industries Inc................................................... 2,180,000
48,300 International Business Machines Corporation.......................... 4,503,975
------------
19,908,975
CONSUMER PRODUCTS (4.9%):
168,100 Corning Incorporated................................................. 5,379,200
185,000 Jostens, Inc......................................................... 3,723,125
95,000 The Coca-Cola Company................................................ 5,878,125
75,000 The Gillette Company................................................. 6,328,125
------------
21,308,575
DRUGS AND MEDICAL SUPPLIES (9.3%):
157,700 Allergan, Inc. ...................................................... 4,198,763
427,751 Ballard Medical Products............................................. 4,972,605
405,000 Biomet, Inc.......................................................... 6,024,375
99,000 Johnson & Johnson.................................................... 6,558,750
53,000 Eli Lilly and Company................................................ 3,955,125
56,250 Medaphis Corporation................................................. 3,389,062
80,000 Pfizer Inc........................................................... 7,050,000
97,684 Rhone-Poulenc Rorer Inc. ............................................ 4,029,465
------------
40,178,145
</TABLE>
2
<PAGE>
STATE FARM BALANCED FUND, INC.
PORTFOLIO OF INVESTMENTS
MAY 31, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
ENTERTAINMENT (2.6%):
200,000 The Walt Disney Company ............................................. $ 11,125,000
HOUSING AND CONSTRUCTION (.7%):
53,400 Vulcan Materials Company............................................. 2,916,975
MACHINERY AND EQUIPMENT (2.7%):
258,200 ADC Telecommunications, Inc.......................................... 8,004,200
64,000 Motorola, Inc........................................................ 3,832,000
------------
11,836,200
MINING AND METALS (1.8%):
160,000 Nucor Corporation.................................................... 7,640,000
OIL AND GAS (2.5%):
144,000 Chevron Corporation.................................................. 7,074,000
72,220 Pennzoil Company..................................................... 3,565,863
------------
10,639,863
UTILITIES (3.5%):
180,000 KN Energy, Inc....................................................... 4,680,000
102,000 SBC Communications Inc............................................... 4,590,000
168,700 Texas Utilities Company.............................................. 6,094,287
------------
15,364,287
MISCELLANEOUS (1.3%):
84,375 Osmonics, Inc........................................................ 1,487,109
110,000 Raychem Corporation.................................................. 4,001,250
------------
5,488,359
------------
Total common stocks (cost: $148,994,268)............................. 260,459,056
CONVERTIBLE BONDS (.3%)
$1,000,000 VLSI Technology, Inc., subordinated, 7.00%, 2012 (cost: $688,750).... 1,190,000
LONG-TERM U.S. GOVERNMENT OBLIGATIONS (24.2%)
1,000,000 U.S. Treasury notes, 8 1/2%, 1995.................................... 1,005,000
3,000,000 U.S. Treasury notes, 4 5/8%, 1995.................................... 2,992,500
1,000,000 U.S. Treasury notes, 8 5/8%, 1995.................................... 1,009,530
1,000,000 U.S. Treasury notes, 7 7/8%, 1996.................................... 1,013,440
1,000,000 U.S. Treasury notes, 7 3/8%, 1996.................................... 1,013,440
3,000,000 U.S. Treasury notes, 8%, 1996........................................ 3,082,500
2,500,000 U.S. Treasury notes, 6 1/2%, 1996.................................... 2,523,050
2,000,000 U.S. Treasury notes, 8%, 1997........................................ 2,065,320
3,000,000 U.S. Treasury notes, 8 1/2%, 1997.................................... 3,144,360
3,000,000 U.S. Treasury notes, 8 3/4%, 1997.................................... 3,185,610
2,000,000 U.S. Treasury notes, 7 7/8%, 1998.................................... 2,100,320
</TABLE>
3
<PAGE>
STATE FARM BALANCED FUND, INC.
PORTFOLIO OF INVESTMENTS
MAY 31, 1995
(UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
<C> <S> <C>
LONG-TERM U.S. GOVERNMENT OBLIGATIONS (CONTINUED)
$3,000,000 U.S. Treasury notes, 9 1/4%, 1998.................................... $ 3,281,250
2,500,000 U.S. Treasury notes, 7 1/8%, 1998.................................... 2,589,450
3,000,000 U.S. Treasury notes, 8 7/8%, 1999.................................... 3,282,660
2,000,000 U.S. Treasury notes, 7%, 1999........................................ 2,067,820
3,000,000 U.S. Treasury notes, 6 3/8%, 1999.................................... 3,036,570
1,500,000 U.S. Treasury notes, 6%, 1999........................................ 1,497,180
3,000,000 U.S. Treasury notes, 6 3/8%, 2000.................................... 3,037,500
3,000,000 U.S. Treasury notes, 5 1/2%, 2000.................................... 2,932,980
850,000 U.S. Treasury bonds, 8 3/8%, 2000.................................... 854,114
2,000,000 U.S. Treasury notes, 8 3/4%, 2000.................................... 2,235,940
1,000,000 U.S. Treasury notes, 7 3/4%, 2001.................................... 1,078,910
625,000 U.S. Treasury bonds, 13 1/8%, 2001................................... 841,894
680,000 U.S. Treasury bonds, 13 3/8%, 2001................................... 931,920
5,500,000 U.S. Treasury notes, 7 1/2%, 2001.................................... 5,886,705
7,500,000 U.S. Treasury notes, 6 3/8%, 2002.................................... 7,565,625
570,000 U.S. Treasury bonds, 11 5/8%, 2002................................... 750,616
5,000,000 U.S. Treasury notes, 6 1/4%, 2003.................................... 4,992,950
3,500,000 U.S. Treasury notes, 5 3/4%, 2003.................................... 3,381,315
500,000 U.S. Treasury bonds, 11 7/8%, 2003................................... 679,765
5,000,000 U.S. Treasury notes, 5 7/8%, 2004.................................... 4,853,900
6,000,000 U.S. Treasury notes, 7 1/4%, 2004.................................... 6,378,720
1,500,000 U.S. Treasury bonds, 11 5/8%, 2004................................... 2,055,465
1,785,000 U.S. Treasury bonds, 8 1/4%, 2005.................................... 1,925,854
4,000,000 U.S. Treasury bonds, 9 3/8%, 2006.................................... 4,925,640
1,000,000 U.S. Treasury bonds, 10 3/8%, 2009................................... 1,271,250
7,000,000 U.S. Treasury bonds, 10%, 2010....................................... 8,778,420
------------
Total long-term U.S. Government obligations (cost: $100,130,990)..... 104,249,483
SHORT-TERM INVESTMENTS (14.5%)
21,000,000 U.S. Treasury bills, due June to August 1995......................... 20,897,614
20,390,000 General Motors Acceptance Corp., 6.00%, 6-6-1995..................... 20,420,635
680,000 General Motors Acceptance Corp., 6.03%, 6-6-1995..................... 680,114
400,000 General Motors Acceptance Corp., 5.92%, 6-6-1995..................... 400,396
20,030,000 Ford Motor Credit Company, 5.95%, 6-13-1995.......................... 20,036,636
------------
Total short-term investments (cost: $62,435,395)..................... 62,435,395
------------
TOTAL INVESTMENTS (99.4%)(cost: $312,249,403)........................ 428,333,934
CASH AND OTHER ASSETS, LESS LIABILITIES (.6%)........................ 2,579,632
------------
NET ASSETS (100.0%).................................................. $430,913,566
============
</TABLE>
Note: At May 31, 1995, net unrealized appreciation of $116,084,531 consisted
of gross unrealized appreciation of $120,039,179 and gross unrealized
depreciation of $3,954,648 based on cost of $312,249,403 for federal
income tax purposes.
See accompanying notes to financial statements.
4
<PAGE>
STATE FARM BALANCED FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
MAY 31, 1995
(UNAUDITED)
ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
Investments, at value (cost $312,249,403).................................. $428,333,934
Cash....................................................................... 933,563
Receivable for:
Dividends and interest................................................... $ 2,144,278
Shares of the Fund sold.................................................. 21,623
Sundry................................................................... 4,725
Securities sold.......................................................... 1,762 2,172,388
-----------
Prepaid expenses........................................................... 39,174
------------
Total assets........................................................... 431,479,059
LIABILITIES AND NET ASSETS
Payable for:
Shares of the Fund redeemed.............................................. 413,524
Other accounts payable (including $141,611 to Manager)................... 151,969
-----------
Total liabilities...................................................... 565,493
------------
Net assets applicable to 12,587,568 shares outstanding of $1.00 par value
common stock (40,000,000 shares authorized).............................. $430,913,566
============
Net asset value, offering price and redemption price per share............. $ 34.23
============
ANALYSIS OF NET ASSETS
Excess of amounts received from sales of shares over amounts paid on
redemptions of shares on account of capital.............................. $297,789,757
Accumulated net realized gain on sales of investments...................... 482,318
Unrealized appreciation of investments..................................... 116,084,531
Undistributed net investment income........................................ 16,556,960
------------
Net assets applicable to shares outstanding................................ $430,913,566
============
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
STATE FARM BALANCED FUND, INC.
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
MAY 31, 1995 NOVEMBER 30, 1994
(UNAUDITED)
<S> <C> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of
$36,443 in 1995 and $51,120 in 1994)...................... $ 2,461,443 4,003,374
Interest.................................................... 5,371,779 8,347,097
----------- -----------
Total investment income................................... 7,833,222 12,350,471
EXPENSES:
Investment advisory and management fee...................... 274,304 499,786
Audit fees.................................................. 9,814 19,459
Legal fees.................................................. 4,756 8,043
Fidelity bond expense....................................... 2,534 5,289
Directors' fees............................................. 1,800 3,300
Reports to shareowners...................................... 10,377 9,763
Taxes....................................................... 5,882 8,904
Other....................................................... 21,281 32,464
----------- -----------
Total expenses............................................ 330,748 587,008
----------- -----------
Net investment income......................................... 7,502,474 11,763,463
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on sales of investments................... 482,318 2,185,924
Net change in unrealized appreciation....................... 39,740,704 (388,583)
----------- -----------
Net realized and unrealized gain on investments............... 40,223,022 1,797,341
----------- -----------
Net change in net assets resulting from operations............ $47,725,496 13,560,804
=========== ===========
</TABLE>
See accompanying notes to financial statements.
6
<PAGE>
STATE FARM BALANCED FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED NOVEMBER 30,
MAY 31, 1995 1994 1993
(UNAUDITED)
<S> <C> <C> <C>
From operations:
Net investment income................................ $ 7,502,474 11,763,463 9,543,443
Net realized gain on sales of investments............ 482,318 2,185,924 653,671
Net change in unrealized appreciation................ 39,740,704 (388,583) (1,554,836)
------------ -------------------------
Net change in net assets resulting from operations... 47,725,496 13,560,804 8,642,278
Undistributed net investment income included in price
of shares issued and redeemed...................... 655,985 1,242,837 2,073,433
Distributions to shareowners from:
Net investment income (per share $.585 in 1995,
$.89 in 1994 and $1.01 in 1993).................. (6,975,879) (9,815,245) (9,220,555)
Net realized gain (per share $.185 in 1995, $.065
in 1994 and $.235 in 1993)....................... (2,185,924) (653,671) (1,983,131)
------------ -------------------------
Total distributions to shareowners................... (9,161,803) (10,468,916) (11,203,686)
From Fund share transactions:
Proceeds from shares sold............................ 33,486,672 68,882,327 86,910,414
Reinvestment of ordinary income dividends and capital
gain distributions................................. 8,654,080 9,876,936 10,654,227
------------ -------------------------
42,140,752 78,759,263 97,564,641
Less payments for shares redeemed.................... 20,961,144 40,409,762 28,900,293
------------ -------------------------
Net increase in net assets from Fund share
transactions....................................... 21,179,608 38,349,501 68,664,348
------------ -------------------------
Total increase in net assets........................... 60,399,286 42,684,226 68,176,373
Net assets:
Beginning of period.................................. 370,514,280 327,830,054 259,653,681
------------ -------------------------
End of period (including undistributed net
investment income of $16,556,960 in 1995,
$15,374,380 in 1994 and $12,183,325 in 1993)..... $430,913,566 370,514,280 327,830,054
============ =========================
</TABLE>
See accompanying notes to financial statements.
7
<PAGE>
STATE FARM BALANCED FUND, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
SECURITY VALUATION -- Investments are stated at value. Stocks traded on
securities exchanges, or in the over-the-counter market in which transaction
prices are reported, are valued at the last sales prices on the day of
valuation or, if there are no reported sales on that day, at the mean of the
last bid and asked quotations. Other stocks traded over-the-counter are valued
at the mean of the last bid and asked prices. Debt securities are valued using
quotations provided by an independent pricing service, except short-term debt
securities having a maturity of 60 days or less from the valuation date are
valued on an amortized cost basis. Any securities not valued as described
above are valued at fair value as determined in good faith by the Board of
Directors or its delegate.
SECURITY TRANSACTIONS AND INVESTMENT INCOME -- Security transactions are
accounted for on the trade date (date the order to buy or sell is executed)
and dividend income is recorded on the ex-dividend date. Interest income is
recorded on the accrual basis. Realized gains and losses from security
transactions are reported on an identified cost basis.
FUND SHARE VALUATION -- Fund shares are sold and redeemed on a continuous
basis at net asset value. Net asset value per share is determined daily as of
3:00 p.m. Bloomington, Illinois time on each business day other than weekend
and holiday closings, except that the Fund need not compute a net asset value
on any day when no purchase or redemption order has been received by the Fund.
The net asset value per share is computed by dividing the value of the Fund's
investments and other assets, less liabilities, by the number of Fund shares
outstanding.
FEDERAL INCOME TAXES, DIVIDENDS AND DISTRIBUTIONS TO SHAREOWNERS -- It is
the Fund's policy to comply with the special provisions of the Internal
Revenue Code available to investment companies and, in the manner provided
therein, to distribute all of its taxable income, as well as any net realized
gain on sales of investments reportable for federal income tax purposes. The
Fund has complied with this policy and, accordingly, no provision for federal
income taxes is required.
On June 16, 1995 an ordinary income dividend of $.605 per share was
declared, payable June 30, 1995 (reinvestment date June 30, 1995) to
shareowners of record on June 16, 1995.
Dividends and distributions payable to its shareowners are recorded by the
Fund on the ex-dividend date.
EQUALIZATION ACCOUNTING -- A portion of proceeds from sales and payments
on redemptions of Fund shares is credited or charged to undistributed net
investment income. As a result, undistributed net investment income per share
is unaffected by sales or redemptions of shares.
RECLASSIFICATION -- Beginning in 1994, taxes withheld on dividends of
foreign issuers have been classified as a reduction in dividend income in the
statement of operations. Such withheld taxes were previously classified as tax
expense. Prior year amounts have been reclassified to conform to the 1994
presentation.
8
<PAGE>
STATE FARM BALANCED FUND, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
2. TRANSACTIONS WITH AFFILIATES
The Fund has an investment advisory and management services agreement with
State Farm Investment Management Corp. (Manager) pursuant to which the Fund
pays the Manager an annual fee (computed on a daily basis and paid quarterly)
of .20% of the first $100 million of average net assets, .15% of the next $100
million of average net assets and .10% of the average net assets in excess of
$200 million. The Manager guarantees that all expenses of the Fund, including
the compensation of the Manager but excluding taxes, interest, extraordinary
litigation expenses, brokerage commissions and other portfolio transaction
costs, shall not exceed .40% of average net assets annually.
Under the terms of this agreement, the Fund incurred fees of $274,304 for
the six months ended May 31, 1995 and $499,786 for the year ended November 30,
1994. The Fund does not pay any discount, commission or other compensation for
transfer agent or underwriting services provided by the Manager.
Certain officers and/or directors of the Fund are also officers and/or
directors of the Manager. The Fund made no payments to its officers or
directors during the six months ended May 31, 1995 and the year ended November
30, 1994, except for directors' fees of $1,800 for the six months ended May
31, 1995 and $3,300 for the year ended November 30, 1994 paid to the Fund's
independent directors.
3. INVESTMENT TRANSACTIONS
Investment transactions (exclusive of money market instruments) are as
follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED NOVEMBER 30,
MAY 31, 1995 1994 1993
<S> <C> <C> <C>
Purchases......................................... $ 9,344,750 42,467,647 66,351,731
Proceeds from sales............................... 4,516,420 13,166,268 9,304,123
=========== ==========================
</TABLE>
9
<PAGE>
STATE FARM BALANCED FUND, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
4. FUND SHARE TRANSACTIONS
Proceeds and payments on Fund shares as shown in the statement of changes
in net assets are in respect of the following number of shares:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED NOVEMBER 30,
MAY 31, 1995 1994 1993
<S> <C> <C> <C>
Shares sold.......................................... 1,063,660 2,304,826 2,922,609
Shares issued in reinvestment of ordinary
income dividends and capital gain
distributions...................................... 286,845 335,084 356,931
--------- ------------------------
1,350,505 2,639,910 3,279,540
Less shares redeemed................................. 670,591 1,350,157 972,181
--------- ------------------------
Net increase in shares outstanding................... 679,914 1,289,753 2,307,359
========= ========================
</TABLE>
10
<PAGE>
STATE FARM BALANCED FUND, INC.
FINANCIAL HIGHLIGHTS
Per Share Income and Capital Changes (For a share outstanding throughout the
period)
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED NOVEMBER 30,
MAY 31, 1995 1994 1993 1992 1991 1990
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period.............................. $ 31.12 30.88 31.24 27.98 22.72 22.27
Income From Investment Operations
Net Investment Income............. .61 1.03 .98 .98 .94 1.06
Net Gains or Losses on Securities
(both realized and unrealized).. 3.27 .17 (.09) 3.29 5.81 .74
---------------------------------------------------------------------------------
Total from Investment Operations.... 3.88 1.20 .89 4.27 6.75 1.80
Less Distributions
Dividends (from net investment
income)......................... (.59) (.89) (1.01) (.89) (1.03) (.92)
Distributions (from capital
gains).......................... (.18) (.07) (.24) (.12) (.46) (.43)
---------------------------------------------------------------------------------
Total Distributions................. (.77) (.96) (1.25) (1.01) (1.49) (1.35)
Net Asset Value, End of Period...... $ 34.23 31.12 30.88 31.24 27.98 22.72
=================================================================================
Total Return........................ 12.74% 3.98% 2.91% 15.43% 31.09% 8.29%
Ratios/Supplemental Data
Net assets, end of period
(millions)........................ $ 430.9 370.5 327.8 259.7 173.5 108.8
Ratio of expenses to average net
assets............................ .17%(a) .17% .19% .22% .26% .27%
Ratio of net investment income to
average net assets................ 3.76%(a) 3.36% 3.20% 3.29% 3.66% 4.87%
Portfolio turnover rate............. 3%(a) 4% 4% 4% 1% 10%
Number of shares outstanding at end
of year (millions)................ 12.6 11.9 10.6 8.3 6.2 4.8
</TABLE>
Notes: (a) Determined on an annualized basis.
11
