UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
Certified Shareholder Report of
Registered Management Investment Companies
Investment Company Act File Number: 811-604
Washington Mutual Investors Fund, Inc.
(Exact Name of Registrant as specified in charter)
1101 Vermont Avenue, NW
Washington, DC 20005
(Address of principal executive offices)
Registrant's telephone number, including area code: (202) 842-5665
Date of fiscal year end: April 30, 2004
Date of reporting period: October 31, 2003
Howard L. Kitzmiller
Secretary
Washington Mutual Investors Fund, Inc.
1101 Vermont Avenue, NW
Washington, DC 20005
(name and address of agent for service)
----------------------------------
Copies to:
JOHN JUDE O'DONNELL, Esq.
THOMPSON, O'DONNELL, MARKHAM, NORTON & HANNON
1212 New York Avenue, Suite 1000, N.W.
Washington, D.C. 20005
(Counsel for the Registrant)
ITEM 1 - Reports to Stockholders
Semi-Annual report dated October 31, 2003
(picture Washington Monument)
(American Funds Logo)
The right choice for the long term(R)
Washington Mutual Investors Fund
Semi-annual report for the six months ended October 31, 2003
Washington Mutual Investors Fund (SM) seeks to provide income and growth of
principal through investments in quality common stocks.
This Fund is one of the 29 American Funds, the nation's third-largest mutual
fund family. For more than seven decades, Capital Research and Management
Company,SM the American Funds adviser, has invested with a long-term focus based
on thorough research and attention to risk.
Fund results in this report were calculated for Class A shares at net asset
value (without a sales charge) unless otherwise indicated. Here are returns on a
$1,000 investment with all distributions reinvested for periods ended September
30, 2003 (the most recent calendar quarter):
Class A shares 1 year 5 years 10 years
Reflecting 5.75% maximum sales charge
Average annual total return +13.64% +2.72% +10.52%
Cumulative total return +13.64% +14.36% +171.84%
Results for other share classes can be found on page 28. For the most current
investment results, please refer to americanfunds.com. Please see the inside
back cover for important information about other share classes.
Figures shown are past results and are not predictive of future results. Share
price and return will vary, so you may lose money. Investing for short periods
makes losses more likely. Investments are not FDIC-insured, nor are they
deposits of or guaranteed by a bank or any other entity.
Fellow shareholders:
Spurred by a meaningful recovery in the U.S. economy, stocks rose sharply in the
six months ended October 31, 2003. Washington Mutual Investors Fund participated
in the rally, posting a total return of 14.4%, with dividends reinvested. The
Fund_s result trailed the 15.6% total return of the unmanaged Standard & Poor's
500 Composite Index, a broad measure of the U.S. stock market. For the past 12
months, your Fund's total return, with dividends reinvested, was 20.3%, just
slightly below the 20.8% return of the S&P 500.
The technology-heavy NASDAQ Composite Index recorded a gain of 32.0%, more than
double that of the S&P 500, over the past six months. Technology and Internet
stocks, few of which pay dividends, led the market surge during this time
period, outpacing the dividend-paying large companies in which your Fund
invests. Often in past market cycles, the companies that have led the market to
its peak, and then have fallen the most, have excelled in the initial stage of
the subsequent stock market recovery. Smaller companies, which often suffer
disproportionate declines in a bear market, also tend to be market leaders early
in a market rebound. Given this environment, we are pleased with Washington
Mutual's recent results.
Over longer periods, your Fund's adherence to strict investment standards,
coupled with experienced management, has produced above-average returns. For the
five years ended October 31, Washington Mutual had an average annual total
return of 3.7%, compared with 0.5% for the S&P 500. Over the 10 years ended
October 31, Washington Mutual posted an average annual total return of 11.7%,
outpacing the S&P 500, which gained an average of 10.4% annually.
In the third quarter ended September 30, 2003, the U.S. economy experienced its
best quarterly growth rate in nearly two decades -- an annualized 8.2% increase
in gross domestic product. That followed an annualized increase of 3.3% in the
second quarter ended June 30. The third quarter boom was fueled by tax
reductions from The Jobs & Growth Tax Relief Reconciliation Act of 2003 signed
on May 28, a high level of mortgage refinancing and a surge in consumer optimism
after the toppling of the Iraqi government. Many economists doubt, however, that
this extraordinary increase in the gross domestic product can be maintained in
the fourth quarter.
The reduction in the federal tax rate on qualified dividend income to 15%,
enacted in late May, has encouraged many companies to re-evaluate their dividend
policies. As of October 31, 368 S&P 500 companies paid dividends, up from 351 at
the end of 2002. Encouragingly, about 29% of the companies in Washington
Mutual's portfolio increased their dividends during the past six months, and we
anticipate that all of the Fund's income dividends will qualify at the 15% rate.
Since our last report to you six months ago, six new companies have appeared in
the Fund's portfolio: Apache, Avery Dennison, Comerica, General Dynamics,
Procter & Gamble and XL Capital. During the same period, six companies have been
eliminated: Dollar General, Dow Chemical, Kerr-McGee, Rockwell Automation,
Sanmina-SCI and SunTrust Banks.
On September 18, the Fund's Board of Directors elected R. Clark Hooper an
independent director of the Fund. Ms. Hooper recently retired from the position
of Executive Vice President of Regulatory Policy and Oversight for the National
Association of Securities Dealers, Inc. (NASD). She had been employed by the
NASD for 32 years.
The number of Washington Mutual shareholders has grown steadily over the years.
Increased use of the Fund's shares in retirement accounts and the CollegeAmerica
Section 529 college savings plan has contributed to the Fund's growth in
shareholders. As of October 31, 2003, the Fund had more than 3 million
shareholder accounts.
We welcome our new shareholders who have joined us in the past six months and
thank our long-time shareholders for their support.
Cordially,
(signature) (signature) (signature)
James H. Lemon, Jr., Harry J. Lister, Jeffrey L. Steele,
Chairman of the Board Vice Chairman of the Board President of the Fund
December 12, 2003
As reported in the press, instances of excessive short-term trading and illegal
"late trading" (trading after 4 p.m. Eastern time) have been discovered at a
number of different fund companies. In several of those cases, fund personnel
engaged in or permitted these activities in clear violation of regulatory
requirements and strict internal policies. This sort of conduct is unethical and
detrimental to long-term shareholders. We will not tolerate it at American
Funds. Although it is often difficult to detect and prevent abusive trading
practices, we are committed to taking action to combat this harmful activity
wherever we find it.
Investment portfolio October 31, 2003 unaudited
Percent of Percent of
Five largest industries net assets Ten largest holdings net assets
Commercial banks 9.70% J.P. Morgan Chase 3.73%
Pharmaceuticals 8.60 ChevronTexaco 3.24
Oil & gas 7.57 Bristol-Myers Squibb 2.52
Electric utilities 7.08 Eli Lilly 2.45
Diversified telecommunication Wells Fargo 2.04
services 5.91 General Electric .97
Pfizer 1.86
General Motors 1.86
Fannie Mae 1.71
Bank of America 1.67
Market Percent
Equity securities 96.06% Shares or value of net
(common stocks and convertible securities) amount (000) assets
Energy 7.83%
Energy equipment & services .26%
Halliburton Co. 3,700,000 $ 88,356 .15%
Schlumberger Ltd. 1,400,000 65,758 .11
154,114 .26
Oil & gas 7.57%
Apache Corp. 2,000,000 139,440 .24
Ashland Inc. 3,680,000 137,043 .23
ChevronTexaco Corp. 25,493,500 1,894,167 3.24
ConocoPhillips 10,107,750 577,658 .99
EOG Resources, Inc. 925,000 38,979 .07
Exxon Mobil Corp. 24,563,000 898,515 1.54
Marathon Oil Corp. 11,700,000 345,969 .59
Sunoco, Inc. 2,750,000 120,340 .20
Unocal Corp. 8,696,500 275,505 .47
4,427,616 7.57
4,581,730 7.83
Materials 5.09%
Chemicals .94%
Air Products and Chemicals, Inc. 7,350,000 333,763 .57
Crompton Corp. 5,800,001 31,088 .05
PPG Industries, Inc. 3,200,000 184,480 .32
549,331 .94
Containers & packaging .14%
Temple-Inland Inc. 1,550,000 83,746 .14
Metals & mining 1.21% Alcoa Inc. 13,650,000 $ 430,930 .74%
Newmont Mining Corp. 6,250,000 273,625 .47
704,555 1.21
Paper & forest products 2.80%
International Paper Co. 20,700,000 814,545 1.39
MeadWestvaco Corp. 7,750,000 200,880 .34
Weyerhaeuser Co. 10,350,000 623,380 1.07
1,638,805 2.80
2,976,437 5.09
Capital goods 7.90%
Aerospace & defense 3.39% Boeing Co. 11,700,000 450,333 .77
General Dynamics Corp. 2,425,000 202,972 .35
Honeywell International Inc. 10,000,000 306,100 .52
Lockheed Martin Corp. 1,000,000 46,360 .08
Northrop Grumman Corp. 4,635,000 414,369 \
Northrop Grumman Corp. 7.25% .73
convertible preferred 2004 140,000 units 14,126 /
Raytheon Co. 6,400,000 169,472 .29
United Technologies Corp. 4,492,100 380,436 .65
1,984,168 3.39
Construction & engineering .22%
Fluor Corp. 3,536,500 131,133 .22
Electrical equipment .51%
Emerson Electric Co. 5,200,000 295,100 .51
Industrial conglomerates 2.36%
General Electric Co. 39,650,000 1,150,246 1.97
Tyco International Ltd. 10,825,000 226,026 .39
1,376,272 2.36
Machinery 1.42%
Caterpillar Inc. 1,225,000 89,768 .15
Deere & Co. 4,580,300 277,658 .48
Dover Corp. 2,000,000 78,040 .13
Eaton Corp. 1,012,900 101,533 .17
Illinois Tool Works Inc. 1,840,000 135,332 .23
Ingersoll-Rand Co. Ltd., Class A 1,700,000 102,680 .18
Pall Corp. 2,000,000 46,800 .08
831,811 1.42
4,618,484 7.90
Commercial services & supplies 1.23%
Commercial services & supplies 1.23%
Avery Dennison Corp. 1,000,000 $ 52,580 .09%
Deluxe Corp. 2,200,000 88,814 .15
IKON Office Solutions, Inc. 6,400,000 53,760 .09
Pitney Bowes Inc. 10,344,900 425,175 .73
ServiceMaster Co. 8,500,000 97,495 .17
717,824 1.23
Transportation .60%
Airlines .25%
Southwest Airlines Co. 7,500,000 145,500 .25
Road & rail .35%
Burlington Northern Santa Fe Corp. 4,000,000 115,760 .20
Union Pacific Corp. 1,400,000 87,640 .15
203,400 .35
348,900 .60
Automobiles & components 1.95%
Auto components .09%
Dana Corp. 3,200,000 52,096 .09
Automobiles 1.86%
General Motors Corp. 24,113,400 1,028,919 \
General Motors Corp., Series B, 5.25% 1.86
convertible debentures 2032 2,442,000 56,557 /
1,085,476 1.86
1,137,572 1.95
Consumer durables & apparel 1.07%
Household durables .47%
Newell Rubbermaid Inc. 6,000,000 136,800 .23
Stanley Works 4,200,000 140,028 .24
276,828 .47
Textiles, apparel & luxury goods .60%
NIKE, Inc., Class B 2,943,700 188,103 .32
VF Corp. 3,800,000 161,310 .28
349,413 .60
626,241 1.07
Hotels, restaurants & leisure .94%
Hotels, restaurants & leisure .94%
Carnival Corp., units 8,650,000 $ 301,971 .51%
McDonald's Corp. 10,000,000 250,100 .43
552,071 .94
Media 1.10%
Media 1.10%
Dow Jones & Co., Inc. 1,900,000 98,743 .17
Gannett Co., Inc. 800,000 67,288 .11
Interpublic Group of Companies, Inc. 11,681,000 173,813 .30
Knight-Ridder, Inc. 1,100,000 80,652 .14
Time Warner Inc. (formerly AOL Time
Warner Inc.)* 14,600,000 223,234 .38
643,730 1.10
Retailing 4.89%
Distributors .47%
Genuine Parts Co. 8,605,800 273,837 .47
Multiline retail 1.40%
May Department Stores Co. 13,865,000 387,665 .66
Target Corp. 10,900,000 433,166 .74
820,831 1.40
Specialty retail 3.02%
Gap, Inc. 2,000,000 38,160 \
.12
Gap, Inc. 5.75% convertible notes 2009 $25,000,000 33,344 /
Limited Brands, Inc. 22,000,000 387,200 .66
Lowe's Companies, Inc. 15,000,000 883,950 1.51
TJX Companies, Inc. 20,250,000 425,047 .73
1,767,701 3.02
2,862,369 4.89
Food & staples retailing 1.47%
Food & staples retailing 1.47%
Albertson's, Inc. 19,906,750 403,908 .69
Walgreen Co. 13,025,000 453,530 .78
857,438 1.47
Food & beverage 4.81%
Beverages .93%
Coca-Cola Co. 6,075,000 281,880 .49
PepsiCo, Inc. 5,400,000 258,228 .44
540,108 .93
Food products 3.88%
ConAgra Foods, Inc. 14,000,000 $ 333,760 .57%
General Mills, Inc. 9,400,000 421,590 .72
H.J. Heinz Co. 14,950,000 528,183 .90
Kellogg Co. 7,200,000 238,536 .41
Sara Lee Corp. 29,300,000 583,949 1.00
Unilever NV (New York registered) 2,800,000 164,220 .28
2,270,238 3.88
2,810,346 4.81
Household & personal products 2.37%
Household products 1.33%
Kimberly-Clark Corp. 13,003,100 686,694 1.18
Procter & Gamble Co. 900,000 88,461 .15
775,155 1.33
Personal products 1.04%
Avon Products, Inc. 8,950,000 608,242 1.04
1,383,397 2.37
Health care equipment & services 1.51%
Health care equipment & supplies .55%
Applera Corp. _ Applied Biosystems Group 8,733,000 201,558 .35
Becton, Dickinson and Co. 3,250,000 118,820 .20
320,378 .55
Health care providers & services .96%
Aetna Inc. 1,250,000 71,763 .12
Cardinal Health, Inc. 4,975,000 295,217 .51
CIGNA Corp. 3,425,000 195,396 .33
562,376 .96
882,754 1.51
Pharmaceuticals & biotechnology 8.60%
Pharmaceuticals 8.60%
Abbott Laboratories 8,450,000 360,139 .62
Bristol-Myers Squibb Co. 58,050,000 1,472,729 2.52
Eli Lilly and Co. 21,550,000 1,435,661 2.45
Johnson & Johnson 2,900,000 145,957 .25
Merck & Co., Inc. 8,300,000 367,275 .63
Pfizer Inc 34,445,000 1,088,462 1.86
Schering-Plough Corp. 4,560,800 69,643 .12
Wyeth 2,000,000 88,280 .15
5,028,146 8.60
Banks 12.98%
Commercial banks 9.70%
Bank of America Corp. 12,870,000 $ 974,645 1.67%
BANK ONE CORP. 8,593,000 364,773 .62
Comerica Inc. 4,900,000 252,252 .43
FleetBoston Financial Corp. 21,740,000 878,079 1.50
HSBC Holdings PLC (ADR) 10,272,000 771,119 1.32
KeyCorp 3,000,000 84,750 .14
National City Corp. 2,800,000 91,448 .16
PNC Financial Services Group, Inc. 7,100,000 380,347 .65
Wachovia Corp. 14,870,000 682,087 1.17
Wells Fargo & Co. 21,135,800 1,190,368 2.04
5,669,868 9.70
Thrifts & mortgage finance 3.28%
Fannie Mae 13,925,000 998,283 1.71
Freddie Mac 8,705,000 488,612 .83
Washington Mutual, Inc. 9,850,000 430,938 .74
1,917,833 3.28
7,587,701 12.98
Diversified financials 5.17%
Capital markets 4.38%
Bank of New York Co., Inc. 12,289,200 383,300 .65
J.P. Morgan Chase & Co. 60,735,000 2,180,387 3.73
2,563,687 4.38
Consumer finance .28%
American Express Co. 1,750,000 82,128 .14
SLM Corp. 2,100,000 82,236 .14
164,364 .28
Diversified financial services .51%
Citigroup Inc. 6,255,000 296,487 .51
3,024,538 5.17
Insurance 5.13%
Insurance 5.13%
Allstate Corp. 14,268,300 563,598 .96
American International Group, Inc. 11,400,000 693,462 1.19
Aon Corp. 9,900,000 216,810 .37
Hartford Financial Services Group, Inc. 3,025,000 166,073 .29
Jefferson-Pilot Corp. 5,925,000 282,860 .48
Lincoln National Corp. 8,050,000 321,437 .55
Marsh & McLennan Companies, Inc. 6,000,000 256,500 .44
St. Paul Companies, Inc. 8,398,800 320,246 .55
XL Capital Ltd., Class A 2,550,000 177,225 .30
2,998,211 5.13
Software & services 1.83%
IT services 1.30%
Automated Data Processing, Inc. 9,700,000 $ 366,078 .62%
Electronic Data Systems Corp. 15,400,000 330,330 \
Electronic Data Systems Corp. 7.625% .68
FELINE PRIDES 2004 3,220,000 units 66,493 /
762,901 1.30
Software .53%
Microsoft Corp. 10,400,000 271,960 .47
Oracle Corp.* 3,000,000 35,880 .06
307,840 .53
1,070,741 1.83
Technology hardware & equipment 3.08%
Communications equipment .45%
Cisco Systems, Inc.* 4,568,600 95,849 .17
Motorola, Inc. 12,100,000 163,713 .28
259,562 .45
Computers & peripherals 2.63%
Dell Inc. (formerly Dell Computer Corp.)* 1,600,000 57,792 .10
EMC Corp.* 10,501,000 145,334 .25
Hewlett-Packard Co. 31,525,000 703,323 1.20
International Business Machines Corp. 5,875,000 525,695 .90
Sun Microsystems, Inc.* 27,000,000 106,920 .18
1,539,064 2.63
1,798,626 3.08
Semiconductors & semiconductor equipment .98%
Semiconductors & semiconductor equipment .98%
Applied Materials, Inc.* 8,500,000 198,645 .34
Intel Corp. 2,500,000 82,625 .14
Linear Technology Corp. 500,000 21,305 .04
Texas Instruments Inc. 8,335,300 241,057 .41
Xilinx, Inc.* 1,000,000 31,700 .05
575,332 .98
Telecommunication services 5.91%
Diversified telecommunication services 5.91%
ALLTEL Corp. 7,884,100 372,681 \
.76
ALLTEL Corp. 7.75% 2005 1,500,000 units 73,500 /
AT&T Corp. 30,579,599 568,475 .97
CenturyTel, Inc. 6.875% ACES 2005 575,000 units 16,290 .03
SBC Communications Inc. 38,800,000 930,424 1.59
Sprint Corp. _ FON Group 44,708,400 715,334 1.23
Verizon Communications Inc. 23,150,000 777,840 1.33
3,454,544 5.91
Utilities 8.45%
Electric utilities 7.08%
Ameren Corp. 2,300,000 $ 102,695 \
Ameren Corp. 9.75% ACES convertible .21%
preferred 2005 760,000 units 21,812 /
American Electric Power Co., Inc. 16,841,300 474,756 .81
Consolidated Edison, Inc. 4,600,000 186,162 .32
Dominion Resources, Inc. 8,870,000 546,392 .94
DTE Energy Co. 3,550,000 130,924 .22
Exelon Corp. 2,500,000 158,625 .27
FirstEnergy Corp. 10,383,635 357,093 .61
FPL Group, Inc. 6,000,000 382,440 .65
PPL Corp. 2,000,000 79,840 .14
Progress Energy, Inc. 11,125,418 479,506 .82
Public Service Enterprise Group Inc. 7,600,000 310,612 .53
Puget Sound Energy, Inc. 3,800,000 86,374 .15
Southern Co. 13,000,000 387,400 .66
TECO Energy, Inc. 1,000,000 13,130 .02
TXU Corp. 8,000,000 182,560 \
.36
TXU Corp. 8.125% FELINE PRIDES 2006 800,000 units 26,504 /
Xcel Energy Inc. 13,000,000 213,200 .37
4,140,025 7.08
Gas utilities .17%
NiSource Inc. 4,900,000 101,479 .17
Multi-utilities & unregulated power 1.20%
Constellation Energy Group, Inc. 7,150,000 260,046 .45
Duke Energy Corp. 20,039,100 363,710 .62
Williams Companies, Inc. 7,500,000 76,500 .13
700,256 1.20
4,941,760 8.45
Miscellaneous 1.17%
Miscellaneous 1.17%
Other equity securities in initial
period of acquisition 686,425 1.17
Total equity securities (cost: $49,143,118,000) 56,165,317 96.06
Principal Market Percent
amount value of net
Short-term securities 3.77% (000) (000) assets
U.S. Treasuries and other federal agencies 3.77%
U.S. Treasuries and other federal agencies 3.77%
Federal Home Loan Bank Discount Notes
.98% - 1.06% due 11/6/2003 - 1/20/2004 $1,100,607 $ 1,099,221 1.88%
United States Treasury Bills .87% - .94%
due 11/6/2003 - 1/29/2004 1,109,153 1,107,982 1.89
Total short-term securities
(cost: $2,207,122,000) 2,207,203 3.77
Total investment securities
(cost: $51,350,240,000) 58,372,520 99.83
Other assets less liabilities 100,526 .17
Net assets $58,473,046 100.00%
*Security did not produce income during the last 12 months.
ADR = American Depositary Receipts
See Notes to Financial Statements
Statement of assets and liabilities at October 31, 2003 unaudited
(dollars and shares in thousands, except per-share amounts)
Assets:
Investment securities at market (cost: $51,350,240) $58,372,520
Cash 505
Receivables for:
Sales of investments $ 43,550
Sales of Fund's shares 130,885
Dividends and interest 122,751 297,186
Other assets 6
58,670,217
Liabilities:
Payables for:
Purchases of investments 96,338
Repurchases of Fund's shares 52,134
Management services 13,584
Services provided by affiliates 33,845
Deferred Directors' and Advisory Board compensation 1,161
Other fees and expenses 109 197,171
Net assets at October 31, 2003 $58,473,046
Net assets consist of:
Capital paid in on shares of capital stock $50,969,936
Undistributed net investment income 148,607
Undistributed net realized gain 332,223
Net unrealized appreciation 7,022,280
Net assets at October 31, 2003 $58,473,046
Total authorized capital stock - 4,000,000 shares, $.001 par value
Net asset
Shares value per
Net assets outstanding share/1/
Class A $51,453,411 1,894,739 $27.16
Class B 2,101,649 77,786 27.02
Class C 1,826,499 67,700 26.98
Class F 1,398,001 51,570 27.11
Class 529-A 300,592 11,077 27.14
Class 529-B 81,017 2,995 27.05
Class 529-C 105,989 3,918 27.05
Class 529-E 15,608 577 27.07
Class 529-F 6,717 248 27.11
Class R-1 12,544 464 27.06
Class R-2 219,165 8,118 27.00
Class R-3 507,523 18,753 27.06
Class R-4 137,850 5,085 27.11
Class R-5 306,481 11,287 27.15
/1/ Maximum offering price and redemption price per share were equal to the
net asset value per share for all share classes, except for classes A and 529-A,
for which the maximum offering prices per share were $28.82 and $28.80,
respectively.
See Notes to Financial Statements
Statement of operations
for the six months ended October 31, 2003 unaudited
(dollars in thousands)
Investment income:
Income:
Dividends (net of non-U.S. withholding
tax of $1,921) $763,411
Interest 12,273 $ 775,684
Fees and expenses:
Investment advisory services 53,403
Business management services 23,249
Distribution services 80,256
Transfer agent services 23,625
Administrative services 4,158
Reports to shareholders 1,185
Registration statement and prospectus 1,008
Postage, stationery and supplies 3,079
Directors' and Advisory Board compensation 492
Auditing and legal 138
Custodian 200
Other 25
Total expenses before reimbursement 190,818
Reimbursement of expenses 135 190,683
Net investment income 585,001
Net realized gain and unrealized appreciation
on investments:
Net realized gain on investments 901,706
Net unrealized appreciation on investments 5,597,688
Net realized gain and unrealized appreciation
on investments 6,499,394
Net increase in net assets resulting from operations $7,084,395
See Notes to Financial Statements
Statement of changes in net assets
(dollars in thousands)
Six months
ended Year ended
October 31, April 30,
2003* 2003
Operations:
Net investment income $ 585,001 $ 1,050,002
Net realized gain on investments 901,706 38,361
Net unrealized appreciation (depreciation)
on investments 5,597,688 (8,316,036)
Net increase (decrease) in net assets resulting
from operations 7,084,395 (7,227,673)
Dividends and distributions paid to shareholders:
Dividends from net investment income (547,524) (1,028,729)
Distributions from net realized gain on investment -- (75,983)
Total dividends and distributions
paid to shareholders (547,524) (1,104,712)
Capital share transactions 3,721,558 3,583,085
Total increase (decrease) in net assets 10,258,429 (4,749,300)
Net assets:
Beginning of period 48,214,617 52,963,917
End of period (including undistributed net
investment income: $148,607 and $111,130,
respectively) $58,473,046 $48,214,617
*Unaudited
See Notes to Financial Statements
Notes to financial statements unaudited
1. Organization and significant accounting policies
Organization -- Washington Mutual Investors Fund (the "Fund") is registered
under the Investment Company Act of 1940 as an open-end, diversified management
investment company. The Fund's investment objective is to produce current income
and to provide an opportunity for growth of principal consistent with sound
common stock investing.
The Fund offers 14 share classes consisting of four retail share classes, five
CollegeAmerica savings plan share classes and five retirement plan share
classes. The CollegeAmerica savings plan share classes (529-A, 529-B, 529-C,
529-E and 529-F) are sponsored by the Commonwealth of Virginia and can be
utilized to save for college education. The five retirement plan share classes
(R-1, R-2, R-3, R-4 and R-5) are sold without any sales charges and do not carry
any conversion rights. The Fund's share classes are described below:
Initial
Share sales Contingent deferred sales
class charge charge upon redemption Conversion feature
Classes A Up to 5.75% None (except 1% for certain None
and 529-A redemptions within one year of
purchase without an initial
sales charge)
Classes B None Declines from 5% to zero for Classes B and 529-B
and 529-B redemptions within six years convert to classes A
of purchase and 529-A, respec-
tively after eight
years
Class C None 1% for redemptions within Class C converts to
one year of purchase Class F after 10
years
Class 529-C None 1% for redemptions within None
one year of purchase
Class 529-E None None None
Classes F None None None
and 529-F
Classes R-1, None None None
R-2, R-3, R-4
and R-5
Holders of all share classes have equal pro rata rights to assets, dividends and
liquidation. Each share class has identical voting rights, except for the
exclusive right to vote on matters affecting only its class. Share classes have
different fees and expenses ("class-specific fees and expenses"), primarily due
to different arrangements for distribution, administrative and shareholder
services. Differences in class-specific fees and expenses will result in
differences in net investment income and, therefore, the payment of different
per-share dividends by each class.
Significant accounting policies -- The financial statements have been prepared
to comply with accounting principles generally accepted in the United States of
America. These principles require management to make estimates and assumptions
that affect reported amounts and disclosures. Actual results could differ from
those estimates. The following is a summary of the significant accounting
policies followed by the Fund:
Security valuation -- Equity securities are valued at the official closing
price of, or the last reported sale price on, the exchange or market on
which such securities are traded, as of the close of business on the day
the securities are being valued or, lacking any sales, at the last
available bid price. Prices for each security are taken from the principal
exchange or market in which the security trades. Fixed-income securities
are valued at prices obtained from an independent pricing service, when
such prices are available. However, where the investment adviser deems it
appropriate, such securities will be valued at the mean quoted bid and
asked prices or at prices for securities of comparable maturity, quality
and type. Short-term securities maturing within 60 days are valued at
amortized cost, which approximates market value. The ability of the issuers
of the debt securities held by the Fund to meet their obligations may be
affected by economic developments in a specific industry, state or region.
Securities and other assets for which representative market quotations are
not readily available are fair valued as determined in good faith by
authority of the Fund's Board of Directors.
Security transactions and related investment income -- Security
transactions are recorded by the Fund as of the date the trades are
executed with brokers. Realized gains and losses from security transactions
are determined based on the specific identified cost of the securities.
Dividend income is recognized on the ex-dividend date and interest income
is recognized on an accrual basis.
Class allocations -- Income, fees, and expenses (other than class-specific
fees and expenses) and realized and unrealized gains and losses are
allocated daily among the various share classes based on their relative net
assets. Class-specific fees and expenses, such as distribution,
administrative and shareholder services, are charged directly to the
respective share class.
Dividends and distributions to shareholders -- Dividends and distributions
paid to shareholders are recorded on the ex-dividend date.
2. Federal income taxation and distributions
The Fund complies with the requirements under Subchapter M of the Internal
Revenue Code applicable to mutual funds and intends to distribute substantially
all of its net taxable income and net capital gains each year. The Fund is not
subject to income taxes to the extent such distributions are made.
Distributions -- Distributions paid to shareholders are based on net investment
income and net realized gains determined on a tax basis, which may differ from
net investment income and net realized gains for financial reporting purposes.
These differences are due primarily to differing treatment for items such as
short-term capital gains and losses; capital losses related to sales of
securities within 30 days of purchase; deferred expenses; and cost of
investments sold. The fiscal year in which amounts are distributed may differ
from the year in which the net investment income and net realized gains are
recorded by the Fund. As of October 31, 2003, the cost of investment securities
for Federal income tax purposes was $51,362,793,000.
As of October 31, 2003, the components of distributable earnings on a tax basis
were as follows:
(dollars in thousands)
Undistributed net investment income $ 149,768
Accumulated short-term capital losses (4,024)
Undistributed long-term capital gains 348,800
Gross unrealized appreciation on investment securities 10,471,918
Gross unrealized depreciation on investment securities (3,462,191)
The tax character of distributions paid to shareholders was as follows (dollars
in thousands):
Six months ended October 31, 2003
Distributions Distributions
from net from long-term Total
investment capital distributions
Share class income gains paid
Class A $500,746 -- $500,746
Class B 12,703 -- 12,703
Class C 10,146 -- 10,146
Class F 11,756 -- 11,756
Class 529-A 2,591 -- 2,591
Class 529-B 415 -- 415
Class 529-C 544 -- 544
Class 529-E 110 -- 110
Class 529-F 44 -- 44
Class R-1 66 -- 66
Class R-2 1,131 -- 1,131
Class R-3 3,050 -- 3,050
Class R-4 1,073 -- 1,073
Class R-5 3,149 -- 3,149
Total $547,524 -- $547,524
Year ended April 30, 2003
Distributions Distributions
from net from long-term Total
investment capital distributions
Share class /1/ income gains paid
Class A $ 969,924 $70,108 $1,040,032
Class B 19,443 2,187 21,630
Class C 13,864 1,631 15,495
Class F 14,299 1,159 15,458
Class 529-A 2,929 238 3,167
Class 529-B 496 62 558
Class 529-C 655 81 736
Class 529-E 103 10 113
Class 529-F 18 1 19
Class R-1 34 3 37
Class R-2 547 56 603
Class R-3 800 72 872
Class R-4 288 28 316
Class R-5 5,329 347 5,676
Total $1,028,729 $75,983 $1,104,712
/1/ Class R-1, R-2, R-3, R-4 and R-5 shares were offered beginning May 15,
2002.
3. Fees and transactions with related parties
Business management services -- The Fund has a business management agreement
with Washington Management Corporation (WMC). Under this agreement, WMC provides
services necessary to carry on the Fund's general administrative and corporate
affairs. These services include all executive personnel, clerical staff, office
space and equipment, certain accounting and recordkeeping facilities,
arrangements for and supervision of shareholder services, and Federal and state
regulatory compliance. Under the agreement, all expenses chargeable to the Class
A shares of the Fund, including compensation to the business manager, shall not
exceed 1% of the average net assets of the Fund on an annual basis. The
agreement provides for monthly fees, accrued daily, based on a declining series
of annual rates beginning with 0.175% on the first $3 billion of daily net
assets and decreasing to 0.040% of such assets in excess of $55 billion. For the
six months ended October 31, 2003, the business management services fee was
$23,249,000, which was equivalent to an annualized rate of 0.086% of average
daily net assets. Johnston, Lemon & Co. Incorporated (JLC), a wholly owned
subsidiary of The Johnston-Lemon Group, Incorporated (JLG), earned $306,000 on
its retail sales of shares and distribution plans of the Fund and received no
brokerage commissions resulting from the purchases and sales of securities for
the investment account of the Fund.
Investment advisory services -- Capital Research and Management Company (CRMC),
the Fund's investment adviser, is the parent company of American Funds Service
Company (AFS), the Fund's transfer agent, and American Funds Distributors, Inc.
(AFD), the principal underwriter of the Fund's shares. The Investment Advisory
Agreement with CRMC provides for monthly fees accrued daily. These fees are
based on a declining series of annual rates beginning with 0.225% on the first
$3 billion of daily net assets and decreasing to 0.185% on such assets in excess
of $55 billion. For the six months ended October 31, 2003, the investment
advisory services fee was $53,403,000, which was equivalent to an annualized
rate of 0.197% of average daily net assets.
Class-specific fees and expenses -- Expenses that are specific to individual
share classes are accrued directly to the respective share class. The principal
class-specific fees and expenses are described below:
Distribution services -- The Fund has adopted plans of distribution for all
share classes, except for Class R-5. Under the plans, the Board of
Directors approves certain categories of expenses that are used to finance
activities primarily intended to sell Fund shares. The plans provide for
annual expenses, based on a percentage of average daily net assets, ranging
from 0.25% to 1.00% as noted below. In some cases, the Board of Directors
has approved expense amounts lower than plan limits.
Share class Currently approved limits Plan limits
Class A 0.25% 0.25%
Class 529-A 0.25 0.50
Classes B and 529-B 1.00 1.00
Classes C, 529-C and R-1 1.00 1.00
Class R-2 0.75 1.00
Classes 529-E and R-3 0.50 0.75
Classes F, 529-F and R-4 0.25 0.50
All share classes may use up to 0.25% of average daily net assets to pay
service fees, or to compensate AFD for paying service fees, to firms that
have entered into agreements with AFD for providing certain shareholder
services. Expenses in excess of these amounts, up to approved limits, may
be used to compensate dealers and wholesalers for distribution expenses.
For classes A and 529-A, the Board of Directors has also approved the
reimbursement of dealer and wholesaler commissions paid by AFD for certain
shares sold without a sales charge. Each class reimburses AFD for amounts
billed within the prior 15 months but only to the extent that the overall
annual expense limit of 0.25% is not exceeded. As of October 31, 2003,
there were no unreimbursed expenses subject to reimbursement for classes A
or 529-A.
Transfer agent services -- The Fund has a transfer agent agreement with AFS
for classes A and B. Under this agreement, these share classes compensate
AFS for transfer agent services including shareholder recordkeeping,
communications and transaction processing. AFS is also compensated for
certain transfer agent services provided to all other share classes from
the administrative services fees paid to CRMC described below.
Administrative services -- The Fund has an administrative services
agreement with CRMC to provide transfer agent and other related shareholder
services for all classes of shares other than classes A and B. Each
relevant class pays CRMC annual fees of 0.15% (0.10% for Class R-5) based
on its respective average daily net assets. Each relevant class also pays
AFS additional amounts for certain transfer agent services. CRMC and AFS
may use these fees to compensate third parties for performing these
services. During the start-up period for classes R-1, R-2 and R-3, CRMC has
voluntarily agreed to pay a portion of these fees. Each 529 share class is
subject to an additional annual admin-istrative services fee of 0.10% of
its respective average daily net assets; this fee is payable to the
Commonwealth of Virginia for the maintenance of the CollegeAmerica plan.
Although these amounts are included with administrative services fees in
the accompanying financial statements, the Commonwealth of Virginia is not
considered a related party. Administrative services fees are presented
gross of any payments made by CRMC.
Expenses under the agreements described above for the six months ended
October 31, 2003, were as follows (dollars in thousands):
Administrative services
Common-
wealth of
CRMC Virginia
Distri- Transfer adminis- Transfer adminis-
bution agent trative agent trative
Share class services services services services services
Class A $59,378 $22,642 Not applicable Not applicable Not applicable
Class B 9,225 983 Not applicable Not applicable Not applicable
Class C 7,637 | $1,146 $ 273 Not applicable
Class F 1,437 | 862 121 Not applicable
Class 529-A 159 | 188 20 $125
Class 529-B 338 Included 51 18 34
Class 529-C 440 in admin- 66 19 44
Class 529-E 32 istrative 9 1 2
Class 529-F 6 services 3 --* 6
Class R-1 49 | 7 4 Not applicable
Class R-2 594 | 119 340 Not applicable
Class R-3 826 | 248 226 Not applicable
Class R-4 135 | 81 6 Not applicable
Class R-5 Not applicable | 136 3 Not applicable
Total $80,256 $23,625 $2,916 $1,031 $211
* Amount less than one thousand.
Deferred Directors' and Advisory Board compensation -- Since the adoption of the
deferred compensation plan in 1994, Independent Directors and Advisory Board
members may elect to defer the cash payment of part or all of their
compensation. These deferred amounts, which remain as liabilities of the Fund,
are treated as if invested in shares of the Fund or other American Funds. These
amounts represent general, unsecured liabilities of the Fund and vary according
to the total returns of the selected Funds. Directors' and Advisory Board
compensation in the accompanying financial statements includes $334,000 in
current fees (either paid in cash or deferred) and a net increase of $158,000 in
the value of the deferred amounts.
Affiliated officers and Directors -- WMC and JLC are both wholly owned
subsidiaries of JLG. All the officers of the Fund and all of its Directors who
are affiliated with JLG receive no compensation directly from the Fund in such
capacities.
4. Capital share transactions
Capital share transactions in the Fund were as follows (dollars and shares in
thousands):
Six months ended October 31, 2003
Reinvestments
of dividends
Sales<F1> and distributions Repurchases<F1> Net increase
Share class Amount Shares Amount Shares Amount Shares Amount Shares
Class A $3,915,940 151,164 $469,662 17,770 $(2,484,560) (95,919) $1,901,042 73,015
Class B 399,896 15,529 12,181 463 (68,095) (2,645) 343,982 13,347
Class C 516,745 20,058 9,623 366 (93,323) (3,626) 433,045 16,798
Class F 457,194 17,649 10,629 402 (104,188) (4,003) 363,635 14,048
Class 529-A 74,263 2,865 2,591 98 (4,547) (175) 72,307 2,788
Class 529-B 20,732 804 415 16 (715) (28) 20,432 792
Class 529-C 27,914 1,081 544 21 (1,996) (77) 26,462 1,025
Class 529-E 4,577 177 110 5 (133) (5) 4,554 177
Class 529-F 3,346 129 44 2 (22) (1) 3,368 130
Class R-1 5,248 203 66 2 (1,823) (70) 3,491 135
Class R-2 124,929 4,861 1,131 43 (20,583) (801) 105,477 4,103
Class R-3 388,785 15,192 3,048 115 (45,961) (1,773) 345,872 13,534
Class R-4 68,360 2,663 1,073 40 (15,074) (578) 54,359 2,125
Class R-5 57,440 2,221 3,063 116 (16,971) (655) 43,532 1,682
Total net
increase
(decrease) $6,065,369 234,596 $514,180 19,459 $(2,857,991) (110,356) $3,721,558 143,699
<FN>
<F1> Includes exchanges between share classes of the Fund.
</FN>
Year ended April 30, 2003
Reinvestments
of dividends
Share Sales<F2> and distributions Repurchases<F2> Net increase
class<F1> Amount Shares Amount Shares Amount Shares Amount Shares
Class A $7,060,551 291,493 $ 973,429 40,929 $(7,098,673) (296,696) $ 935,307 35,726
Class B 792,895 32,647 20,726 880 (184,797) (7,910) 628,824 25,617
Class C 809,481 33,465 14,733 629 (168,702) (7,234) 655,512 26,860
Class F 696,571 28,917 14,070 599 (180,470) (7,670) 530,171 21,846
Class 529-A 163,103 6,654 3,167 135 (5,308) (228) 160,962 6,561
Class 529-B 45,053 1,846 559 24 (1,178) (50) 44,434 1,820
Class 529-C 59,484 2,427 736 31 (2,082) (90) 58,138 2,368
Class 529-E 9,228 379 113 5 (256) (11) 9,085 373
Class 529-F 2,749 118 19 1 (27) (1) 2,741 118
Class R-1 8,234 354 37 1 (598) (26) 7,673 329
Class R-2 106,862 4,638 603 26 (14,832) (649) 92,633 4,015
Class R-3 139,939 6,051 867 38 (19,854) (870) 120,952 5,219
Class R-4 74,628 3,294 316 14 (7,707) (348) 67,237 2,960
Class R-5 313,165 11,520 5,529 233 (49,278) (2,148) 269,416 9,605
Total net
increase
(decrease) $10,281,943 423,803 $1,034,904 43,545 $(7,733,762) (323,931) $3,583,085 143,417
<FN>
<F1> Class R-1, R-2, R-3, R-4 and R-5 shares were offered beginning May 15, 2002.
<F2> Includes exchanges between share classes of the Fund.
</FN>
5. Investment transactions and other disclosures
The Fund made purchases and sales of investment securities, excluding short-term
securities, of $6,531,787,000 and $3,275,472,000, respectively, during the six
months ended October 31, 2003.
The Fund receives a reduction in its custodian fee equal to the amount of
interest calculated on certain cash balances held at the custodian bank. For the
six months ended October 31, 2003, the custodian fee of $200,000 includes $5,000
that was offset by this reduction, rather than paid in cash.
6. Investments in affiliates
The Fund owns 5.43%, 5.39% and 5.22% of the outstanding voting securities of
Albertson's, Ashland and Crompton, respectively, and therefore, each is
considered an "affiliated company" of the Fund under the Investment Company Act
of 1940.
Financial highlights<F1>
Income (loss) from
investment Dividends
operations<F3> and distributions
-------------------- ----------------
Net
gains
(losses)
on secu- Ratio
Net rities Divi- Distri-Total Ratio of net
asset Net (both Total ends bu- divi- Net Net of ex- income
value, in- real- from (from tions dends asset assets, penses (loss)
begin- vest- ized invest- net (from and value end of to to
ning ment and un- ment invest- capi- dis- end Total period average average
of income real- oper- ment tal tribu- of re- (in mil- net net
period (loss) ized) ations income)gains) tions period turn<F4> lions) assets assets
Class A: Six months ended 10/31/2003<F2> $23.99 $.29 $3.15 $3.44 $(.27) $.-- $(.27) $27.16 14.37% $51,453 .65%<F5> 2.22%<F5>
Year ended 4/30/2003 28.37 .55 (4.35) (3.80) (.54) (.04) (.58) 23.99 (13.36) 43,701 .67 2.28
Year ended 4/30/2002 29.80 .50 (.75) (.25) (.54) (.64)(1.18) 28.37 (.73) 50,669 .65 1.72
Year ended 4/30/2001 29.14 .57 3.17 3.74 (.58) (2.50)(3.08) 29.80 13.54 48,700 .65 1.95
Year ended 4/30/2000 35.31 .61 (3.09) (2.48) (.58) (3.11)(3.69) 29.14 (6.96) 47,319 .63 1.91
Year ended 4/30/1999 33.92 .60 3.99 4.59 (.61) (2.59)(3.20) 35.31 14.61 57,018 .61 1.84
Class B: Six months ended 10/31/2003<F2> 23.88 .19 3.13 3.32 (.18) .-- (.18) 27.02 13.91 2,102 1.41<F5> 1.45<F5>
Year ended 4/30/2003 28.25 .36 (4.32) (3.96) (.37) (.04) (.41) 23.88 (14.01) 1,538 1.45 1.52
Year ended 4/30/2002 29.71 .25 (.72) (.47) (.35) (.64) (.99) 28.25 (1.50) 1,097 1.41 .88
Year ended 4/30/2001 29.11 .29 3.22 3.51 (.41) (2.50)(2.91) 29.71 12.67 289 1.42 .99
Period from 3/15/2000 26.93 .02 2.16 2.18 .-- .-- .-- 29.11 8.09 34 .17 .08
to 4/30/2000
Class C: Six months ended 10/31/2003<F2> 23.84 .18 3.13 3.31 (.17) .-- (.17) 26.98 13.91 1,826 1.49<F5> 1.36<F5>
Year ended 4/30/2003 28.22 .35 (4.33) (3.98) (.36) (.04) (.40) 23.84 (14.10) 1,214 1.51 1.46
Year ended 4/30/2002 29.70 .21 (.73) (.52) (.32) (.64) (.96) 28.22 (1.68) 678 1.51 .72
Period from 3/15/2001 28.32 (.02) 1.40 1.38 .-- .-- .-- 29.70 4.87 36 .23 (.07)
to 4/30/2001
Class F: Six months ended 10/31/2003<F2> 23.95 .28 3.14 3.42 (.26) .-- (.26) 27.11 14.33 1,398 .72<F5> 2.13<F5>
Year ended 4/30/2003 28.33 .53 (4.34) (3.81) (.53) (.04) (.57) 23.95 (13.42) 899 .74 2.24
Year ended 4/30/2002 29.79 .42 (.72) (.30) (.52) (.64)(1.16) 28.33 (.89) 444 .78 1.46
Period from 3/15/2001 28.37 .01 1.41 1.42 .-- .-- .-- 29.79 5.01 16 .12 .04
to 4/30/2001
Class Six months ended 10/31/2003<F2> 23.97 .28 3.16 3.44 (.27) .-- (.27) 27.14 14.33 301 .70<F5> 2.15<F5>
529-A: Year ended 4/30/2003 28.36 .54 (4.35) (3.81) (.54) (.04) (.58) 23.97 (13.38) 199 .70 2.29
Period from 2/15/2002 27.71 .04 .75 .79 (.14) .00 (.14) 28.36 2.82 49 .16 .14
to 4/30/2002
Class Six months ended 10/31/2003<F2> 23.91 .16 3.14 3.30 (.16) .-- (.16) 27.05 13.82 81 1.61<F5> 1.24<F5>
529-B: Year ended 4/30/2003 28.34 .32 (4.35) (4.03) (.36) (.04) (.40) 23.91 (14.18) 53 1.62 1.36
Period from 2/19/2002 27.25 (.01) 1.22 1.21 (.12) .-- (.12) 28.34 4.38 11 .30 (.02 )
to 4/30/2002
Class Six months ended 10/31/2003<F2> 23.91 .16 3.14 3.30 (.16) .-- (.16) 27.05 13.82 106 1.60<F5> 1.25<F5>
529-C: Year ended 4/30/2003 28.33 .32 (4.34) (4.02) (.36) (.04) (.40) 23.91 (14.18) 69 1.61 1.38
Period from 2/15/2002 27.71 (.01) .75 .74 (.12) .-- (.12) 28.33 2.65 15 .32 (.03)
to 4/30/2002
Class Six months ended 10/31/2003<F2> 23.92 .23 3.14 3.37 (.22) .-- (.22) 27.07 14.13 16 1.07<F5> 1.78<F5>
529-E: Year ended 4/30/2003 28.34 .45 (4.35) (3.90) (.48) (.04) (.52) 23.92 (13.73) 9 1.08 1.92
Period from 3/1/2002 28.59 .01 (.13) (.12) (.13) .-- (.13) 28.34 (.44) 1 .17 .04
to 4/30/2002
Class Six months ended 10/31/2003<F2> 23.96 .26 3.15 3.41 (.26) .-- (.26) 27.11 14.25 7 .82<F5> 2.00<F5>
529-F: Period from 9/16/2002 23.98 .32 .10 .42 (.40) (.04) (.44) 23.96 1.85 3 .82<F5> 2.25<F5>
to 4/30/2003
<FN>
<F1> Based on operations for the period shown (unless otherwise noted) and,
accordingly, may not be representative of a full year.
<F2> Unaudited.
<F3> Year ended 1999 is based on shares outstanding on the last day of the year;
all other periods are based on average shares outstanding.
<F4> Total returns exclude all sales charges, including contingent deferred
sales charges.
<F5> Annualized.
</FN>
Financial highlights<F1>
Income (loss) from
investment Dividends
operations<F3> and distributions
-------------------- ----------------
Net
gains
(losses)
on secu- Ratio Ratio
Net rities Divi- Distri-Total of ex- of net
asset Net (both Total ends bu- divi- Net Net penses income
value, in- real- from (from tions dends asset assets, to (loss)
begin- vest- ized invest- net (from and value end of average to
ning ment and un- ment invest- capi- dis- end Total period net average
of income real- oper- ment tal tribu- of re- (in mil- assets net
period (loss) ized) ations income)gains) tions period turn lions) <F4> assets
Class Six months ended 10/31/20032 $23.92 $.18 $ 3.13 $ 3.31 $(.17) .-- (.17) $27.06 13.87% $ 13 1.50%<F5>1.36%<F4>
R-1: Period from 5/29/2002 28.52 .32 (4.46) (4.14) (.42) (.04) (.46) 23.92 (14.50) 8 1.51<F5> 1.50<F4>
to 4/30/2003
Class Six months ended 10/31/20032 23.88 .18 3.13 3.31 (.19) .-- (.19) 27.00 13.86 219 1.47<F5> 1.36<F4>
R-2: Period from 5/31/2002 28.46 .33 (4.40) (4.07) (.47) (.04) (.51) 23.88 (14.29) 96 1.47<F5> 1.58<F4>
to 4/30/2003
Class Six months ended 10/31/20032 23.93 .22 3.15 3.37 (.24) .-- (.24) 27.06 14.10 507 1.08<F5> 1.73<F4>
R-3: Period from 6/4/2002 27.81 .41 (3.74) (3.33) (.51) (.04) (.55) 23.93 (11.94) 125 1.09<F5> 1.95<F4>
to 4/30/2003
Class Six months ended 10/31/20032 23.95 .28 3.14 3.42 (.26) .-- (.26) 27.11 14.34 138 .71 2.13<F4>
R-4: Period from 5/20/2002 28.78 .51 (4.74) (4.23) (.56) (.04) (.60) 23.95 (14.66) 71 .73<F5> 2.32<F4>
to 4/30/2003
Class Six months ended 10/31/20032 23.99 .32 3.14 3.46 (.30) .-- (.30) 27.15 14.47 306 .40 2.46<F4>
R-5: Period from 5/15/2002 28.84 .57 (4.78) (4.21) (.60) (.04) (.64) 23.99 (14.57) 230 .41 2.51<F4>
to 4/30/2003
Six months Year ended April 30
ended October 31,
2003<F2> 2003 2002 2001 2000 1999
Portfolio turnover rate
for all classes of shares 6% 21% 22% 25% 26% 28%
<FN>
<F1> Based on operations for the period shown (unless otherwise noted) and,
accordingly, may not be representative of a full year.
<F2> Unaudited.
<F3> Based on average shares outstanding.
<F4> Annualized.
<F5> During the start-up period for this class, CRMC voluntarily agreed to pay a
portion of the fees relating to transfer agent services. Had CRMC not paid such
fees, expense ratios would have been 1.54%, 1.63% and 1.09% for classes R-1, R-2
and R-3, respectively, during the six months ended October 31, 2003, and 1.71%,
1.78%, 1.11% and .74% for classes R-1, R-2, R-3 and R-4, respectively, during
the period ended April 30, 2003.
</FN>
Other share class results unaudited
Class B, Class C, Class F and Class 529
Returns for periods ended September 30, 2003
(the most recent calendar quarter):
Life of
1 year class
Class B shares
Reflecting applicable contingent deferred sales charge (CDSC),
maximum of 5%, payable only if shares are sold within six
years of purchase +14.73% +2.45%/1/
Not reflecting CDSC +19.73% +3.20%/1/
Class C shares
Reflecting CDSC, maximum of 1%, payable only if shares are
sold within one year of purchase +18.60% -1.59%/2/
Not reflecting CDSC +19.60% -1.59%/2/
Class F shares/3/
Not reflecting annual asset-based fee charged +20.52% 0.81%/2/
by sponsoring firm
Class 529-A shares
Reflecting 5.75% maximum sales charge +13.70% -5.48%/4/
Not reflecting maximum sales charge +20.66% -1.97%/4/
Class 529-B shares
Reflecting applicable CDSC, maximum of 5%, payable only if
shares are sold within six years of purchase +14.49% -4.23%/5/
Not reflecting CDSC +19.49% -1.84%/5/
Class 529-C shares
Reflecting CDSC, maximum of 1%, payable only if shares are
sold within one year of purchase +18.50% -2.83%/4/
Not reflecting CDSC +19.50% -2.83%/4/
Class 529-E shares/3/ +20.09% -4.32%/6/
Class 529-F shares/3/
Not reflecting annual asset-based fee charged
by sponsoring firm +20.42% +10.29%/7/
/1/ Average annual total return from March 15, 2000, when Class B shares were
first sold.
/2/ Average annual total return from March 15, 2001, when Class C and Class F
shares were first sold.
/3/ These shares are sold without any initial or contingent deferred sales
charge.
/4/ Average annual total return from February 15, 2002, when Class 529-A and
Class 529-C shares were first sold.
/5/ Average annual total return from February 19, 2002, when Class 529-B shares
were first sold.
/6/ Average annual total return from March 1, 2002, when Class 529-E shares
were first sold.
/7/ Average annual total return from September 16, 2002, when Class 529-F
shares were first sold.
Offices of the Fund and of the business manager
Washington Management Corporation
1101 Vermont Avenue, NW
Washington, DC 20005-3585
202/842-5665
Investment adviser
Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071-1406
135 South State College Boulevard
Brea, CA 92821-5823
Transfer agent
American Funds Service Company
(Please write to the address nearest you.)
P.O. Box 25065, Santa Ana, CA 92799-5065
P.O. Box 659522, San Antonio, TX 78265-9522
P.O. Box 6007, Indianapolis, IN 46206-6007
P.O. Box 2280, Norfolk, VA 23501-2280
Custodian of assets
JPMorgan Chase Bank
270 Park Avenue
New York, NY 10017-2070
Counsel
Thompson, O'Donnell, Markham,
Norton & Hannon
1212 New York Avenue, NW
Washington, DC 20005-3987
Independent auditors
PricewaterhouseCoopers LLP
350 South Grand Avenue
Los Angeles, CA 90071-2889
Principal underwriter
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, CA 90071-1406
There are several ways to invest in Washington Mutual Investors Fund. Class A
shares are subject to a 5.75% maximum up-front sales charge that declines for
accounts (and aggregated investments) of $25,000 or more. Other share classes,
which are generally not available for certain employer-sponsored retirement
plans, have no up-front sales charges but are subject to additional annual
expenses and fees. Annualized expenses for Class B shares were 0.76% higher than
for Class A shares; Class B shares convert to Class A shares after eight years
of ownership. If redeemed within six years, Class B shares may also be subject
to a contingent deferred sale charge (CDSC) of up to 5% that declines over time.
Class C shares were subject to annualized expenses 0.84 percentage points higher
than those for Class A shares and a 1% CDSC if redeemed within the first year
after purchase. Class C shares convert to Class F shares after 10 years. Class F
shares, which are available only through certain fee-based programs offered by
broker-dealer firms and registered investment advisers, had higher annualized
expenses (by 0.07 percentage points) than did Class A shares, and an annual
asset-based fee charged by the sponsoring firm. Expenses are deducted from
income earned by the Fund. As a result, dividends and investment results will
differ for each share class.
For information about your account or any of the Fund's services, or for a
prospectus for any of the American Funds, please call American Funds Service
Company at 800/421-0180 or visit us at americanfunds.com. Please read the
prospectus carefully before you invest or send money.
This report is for the information of shareholders of Washington Mutual
Investors Fund, Inc., but it may also be used as sales literature when preceded
or accompanied by the current prospectus, which gives details about charges,
expenses, investment objectives and operating policies of the Fund. If used as
sales material after December 31, 2003, this report must be accompanied by an
American Funds statistical update for the most recently completed calendar
quarter.
(logo American Funds)
The right choice for the long term(R)
(Washington Mutual Investors Fund Logo)
Washington Mutual Investors Fund, Inc.
1101 Vermont Avenue, NW
Washington, DC 20005
202/842-5665
Lit.No. MFGEAR-901-1203
(recycle symbol)
Printed on recycled paper
The Capital Group Companies
American Funds
Capital Research and Management
Capital International
Capital Guardian
Capital Bank and Trust
ITEM 2 - Code of Ethics
The Registrant has adopted a code of ethics that applies to its Principal
Executive Officer and Principal Financial Officer. The Registrant undertakes to
provide to any person without charge, upon request, a copy of the Code of
Ethics. Such request can be made to American Funds Service Company at
800/421-0180 or to the Secretary of the Registrant, 1101 Vermont Avenue, NW,
Suite 600, Washington, DC 20005.
ITEM 3 - Audit Committee Financial Expert
Not applicable to this filing.
ITEM 4 - Principal Accountant Fees and Services
Form N-CSR disclosure requirement not yet effective with respect to Registrant.
ITEM 5 - Audit Committee of Listed Registrants
Not applicable.
ITEM 6 - Reserved
ITEM 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies
Not applicable to this Registrant, insofar as the Registrant is not a closed-end
management investment company.
ITEM 8 - Reserved
ITEM 9 - Controls and Procedures
(a) The officers providing the certifications in this report in accordance with
rule 30a-2 under the Investment Company Act of 1940 have concluded, based on
their evaluation of the Registrant's disclosure controls and procedures (as such
term is defined in such rule), that such controls and procedures are adequate
and reasonably designed to achieve the purposes described in paragraph (c) of
such rule.
(b) There were no changes in the Registrant's internal controls over financial
reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940)
that occurred during the Registrant's last fiscal half-year (the Registrant's
second fiscal half-year in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the Registrant's
internal control over financial reporting.
ITEM 10 - Exhibits
(a) Not applicable to this filing.
(b) The certifications required by Rule 30a-2 of the Investment Company Act of
1940, as amended, and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are
attached as exhibits hereto. (a)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Washington Mutual Investors Fund, Inc.
By Harry J. Lister, Vice Chairman and PEO
Date: January 6, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By Harry J. Lister, Vice Chairman and PEO
Date: January 6, 2004
By Howard L. Kitzmiller, Senior Vice President, Secretary, and Treasurer
Date: January 6, 2004