SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: 811-4000
--------
SUMMIT MUTUAL FUNDS, INC.
(Exact name of registrant as specified in charter)
1876 Waycross Road, Cincinnati, Ohio 45240
(Address of principal executive offices) Zip code)
John F. Labmeier, Esq.
The Union Central Life Insurance Company
P.O. Box 40888
1876 Waycross Road
Cincinnati, Ohio 45240
(Name and address of agent for service)
Registrant's telephone number, including area code: (513) 595-2600
Date of fiscal year end: December 31, 2003
Date of reporting period: June 30, 2003
ITEM 1. REPORTS TO STOCKHOLDERS
<Page>
SUMMIT
MUTUAL
FUNDS
SEMIANNUAL
REPORT
SUMMIT PINNACLE SERIES
Zenith Portfolio
Bond Portfolio
S&P 500 Index Portfolio
S&P MidCap 400 Index Portfolio
Balanced Index Portfolio
Nasdaq-100 Index Portfolio
Russell 2000 Small Cap Index Portfolio
EAFE International Index Portfolio
Lehman Aggregate Bond Index Portfolio
June 30, 2003
[LOGO] SUMMIT
MUTUAL
FUNDS
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SEMIANNUAL REPORT - TABLE OF CONTENTS
- -----------------------------------------------------------------
<Table>
Message from the President.................................. 1
Investment Review
Zenith Portfolio........................................ 2
Bond Portfolio.......................................... 3
S&P 500 Index Portfolio................................. 4
S&P MidCap 400 Index Portfolio.......................... 5
Balanced Index Portfolio................................ 6
Nasdaq-100 Index Portfolio.............................. 7
Russell 2000 Small Cap Index Portfolio.................. 8
EAFE International Index Portfolio...................... 9
Lehman Aggregate Bond Index Portfolio................... 10
Statements of Assets and Liabilities........................ 11
Statements of Operations.................................... 13
Statements of Changes in Net Assets......................... 15
Schedule of Investments
Zenith Portfolio........................................ 19
Bond Portfolio.......................................... 20
S&P 500 Index Portfolio................................. 24
S&P MidCap 400 Index Portfolio.......................... 29
Balanced Index Portfolio................................ 33
Nasdaq-100 Index Portfolio.............................. 38
Russell 2000 Small Cap Index Portfolio.................. 40
EAFE International Index Portfolio...................... 57
Lehman Aggregate Bond Index Portfolio................... 60
Notes to Financial Statements............................... 61
</Table>
THIS REPORT HAS BEEN PREPARED FOR THE INFORMATION OF CONTRACT OWNERS AND
IS NOT AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE PURCHASERS OF CONTRACTS
UNLESS IT IS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS FOR SUMMIT
MUTUAL FUNDS, INC.
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
2003 SEMIANNUAL REPORT - MESSAGE FROM THE PRESIDENT
- ------------------------------------------------------------------
We are pleased to provide you the Summit Mutual Funds Semiannual Report on
the Pinnacle Series, a family of funds that supports the investment needs
of your specific variable insurance product. We are also very pleased to
welcome new investors to Summit.
After a long bout with uncertainty, stocks seemed to lift their collective
head as the war in Iraq came to a close in March. Even though that
situation will remain unsettled for some time, consumer, business, and
investor confidence rose as the market breathed a sigh of relief. Indeed,
confidence was the main catalyst for the improved market outlook -
especially in the second quarter. While there was continued volatility in
all financial markets, stocks staged a dramatic rally as shown in the
following table. Domestic broad-based index returns for the period
generally increased as market capitalization levels decreased. However,
the more narrowly based NASDAQ 100 Index, comprised of the 100 largest
non-financial companies in the NASDAQ Composite led the way with a 22.2%
gain. Most major international equity markets posted positive albeit
smaller returns as well and the MSCI EAFE Index, helped by a weak U.S.
dollar, increased 9.5%.
Fixed income investors fared well as many investors preferred the recent
safety of the bond market. The Federal Reserve, quiet most of the period,
did lower its target Fed Funds rate by .25% in late June - a move that was
viewed as disappointing to many fixed income investors cutting into the
positive returns of this asset class. The Lehman Aggregate Bond Index, a
measure of high quality domestic bonds, has risen 3.9% so far in 2003.
Volatility has been high in this market - especially high quality U.S.
Treasury issues. The 10 year U.S. Treasury has traded as low as 3.1% in
early June, down significantly from 4.2% in early January.
"... ALTHOUGH THE MARKET'S UPS AND DOWNS CAN BE HARROWING, THEY ARE A
NATURAL PART OF MARKET DYNAMICS."
Diversification, diversification, diversification. While you have heard
this theme from us many times in the past, it is still important to keep
in mind. Recent events, such as geopolitical tensions and deflationary
fears that impact financial markets, remind us that although the market's
ups and downs can be harrowing, they are a natural part of market
dynamics. Our thoughts have always been to maintain the proper
perspective, have realistic expectations, and ensure that your investment
strategy is appropriate for your risk tolerance and time horizon. One way
to dampen the impact of volatility on your portfolio is to adequately
diversify your investments, both within and across asset sectors, or
specifically stocks, bonds, and cash. With our broad range of funds,
Summit Mutual Funds is able to provide the foundation of a diversified
investment plan.
Of particular note in the first half of 2003, were the following highlights:
- - Summit Mutual Funds continues to educate investors through
a "core & explore" asset allocation strategy as to prudent
investing in both diversified index and actively managed funds
for both personal and retirement funds.
- - We introduced the Summit Lehman Brothers Aggregate Bond Index
Portfolio. This index is comprised of investment grade securities
including U.S. Treasuries, corporate bonds, and mortgage- and
asset-backed securities and is considered one of the premier
fixed income indices.
- - Our roster of index funds available as investment choices to
investors in variable insurance products such as variable annuities
and variable life is one of the most robust in the industry and
includes the major equity indices - S&P 500, S&P Midcap 400,
Russell 2000 Small Cap, Nasdaq-100 and the MSCI EAFE International
Equity.
On the following pages you will find commentary from Summit's portfolio
managers and specific details as to each Fund's portfolio and total return
investment performance. Please read this information and ask questions of
your financial advisor - or contact us at webmaster@summitpartnersllc.com
or toll-free 877-546-3863.
We thank you for the continuing trust you have placed in us.
Best regards,
/s/ Steven R. Sutermeister
Steven R. Sutermeister
President
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
Index Returns Q2 2003
<Table>
S&P 500 Index 11.80%
S&P Midcap 400 Index 12.40%
Russell 2000 Index 17.90%
NASDAQ 100 Index 22.20%
MSCI EAFE Index 9.50%
</Table>
1
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
ZENITH PORTFOLIO
- -------------------------------------------------------------------
OBJECTIVE - Seeks long-term appreciation of capital by investing in common
stocks and other equity securities with values that are, at present, not
fully recognized by the market.
STRATEGY - The Summit Pinnacle Zenith Portfolio (the "Portfolio") will
remain in a highly invested position ranging from 86% to 98%. The cash
position will be held in highly liquid money market instruments to meet
redemptions and to provide cash for future stock purchases as new
opportunities arise.
MANAGER'S COMMENTS:
The Portfolio's total return performance through period ended June 30,
2003 was +17.58% (before contract fees and expenses) versus +11.57% for
the Russell 1000 Value Index and +11.76% for the S&P 500 Index. These
indices started the year in negative territory in the first quarter only
to have a sharp recovery in the second quarter after the positive outcome
of the war in Iraq improved investor's confidence. After three negative
years in the equity markets that drove prices lower and lower, valuations
appear to be turning up.
Monetary policy remained stimulative as witnessed by the thirteenth cut in
federal funds rates in this cycle. The positive outcome of the war in Iraq
also affected domestic policy as President Bush was able to pass a
stimulative tax cut package to boost the economy in time for his re-
election campaign. (The last time that the markets were down in the third
year of the presidency was 1939.) One key aspect of President Bush's
stimulus package is a significant reduction of taxation on dividends,
which should help the equity markets. President Bush is far more worried
about pumping up the economy during the next 18 months than he is about
near-term budget deficits. Therefore governmental forces are fully
employing monetary and fiscal policies to encourage an economic rebound by
stimulating economic growth and not worrying about a potential inflation
resurgence.
The Portfolio outperformed its benchmark indices by holding positions that
were more economically sensitive. These positions declined last year, but
were able to rise faster when the market rebounded this year. Names that
were mentioned in the last report that hindered performance due to their
economic sensitivity, this time rebounded at a higher rate than the
market. Delta Airlines, one of the premier airlines in the country, was
priced as though it was nearly bankrupt as the market for corporate credit
was tightened for airlines. Sears, the department store chain, was also
under intense scrutiny since its credit card operations were being
criticized for being too lax with credit controls. Even General Electric
suffered as its AAA credit was called into question in the squeeze on
corporate credit. Delta Airlines, Sears and General Electric are names
that performed much better in the more robust market environment that
existed this year.
The Portfolio is attempting to capitalize on its performance by reducing
positions that have outperformed the market and reinvesting in companies
that have lagged the overall market move. Names such as General Dynamics,
Sara Lee and Baxter have been added due to their low price-to-cash flow,
low price-to- earnings and current year-to-date underperformance.
FUND DATA
<Table>
Manager: James McGlynn
Inception Date: August 15, 1984
Total Net Assets: $41.82 Million
Number of Holdings: 51
Median Cap Size: $19.48 Billion
Average Price-to-book Ratio: 2.17x
Dividend Yield: 2.28%
Average Price-to-earnings Ratio:
Summit Pinnacle Zenith Portfolio 18.49x
S&P 500 Index 19.78x
</Table>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
Summit Zenith Portfolio - Average Annual Total Return
<Table>
<Caption>
1-YEAR 5-YEAR 10-YEAR
- -0.41% 0.51% 8.54%
</Table>
Past performance is not predictive of future results. Performance does not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or redemption of fund shares. Separate account expenses are
not included.
<Table>
<Caption>
SUMMIT ZENITH RUSSELL 1000 RUSSELL 2000
PORTFOLIO VALUE INDEX INDEX
Jun-1993 $10,000 $10,000 $1,000
Jul-1993 $11,383 $10,112 $1,013
Aug-1993 $11,874 $10,477 $1,055
Sep-1993 $12,027 $10,494 $1,084
Oct-1993 $12,325 $10,486 $1,111
Nov-1993 $12,002 $10,270 $1,073
Dec-1993 $12,410 $10,465 $1,108
Jan-1994 $12,878 $10,861 $1,142
Feb-1994 $12,827 $10,490 $1,138
Mar-1994 $12,471 $10,099 $1,076
Apr-1994 $12,640 $10,293 $1,082
May-1994 $12,719 $10,412 $1,068
Jun-1994 $12,496 $10,162 $1,030
Jul-1994 $12,621 $10,478 $1,046
Aug-1994 $13,218 $10,780 $1,103
Sep-1994 $13,066 $10,422 $1,098
Oct-1994 $13,147 $10,567 $1,093
Nov-1994 $12,735 $10,140 $1,047
Dec-1994 $12,835 $10,257 $1,073
Jan-1995 $12,969 $10,573 $1,058
Feb-1995 $13,400 $10,991 $1,100
Mar-1995 $13,605 $11,232 $1,118
Apr-1995 $13,926 $11,587 $1,141
May-1995 $14,267 $12,074 $1,158
Jun-1995 $14,589 $12,238 $1,215
Jul-1995 $15,010 $12,664 $1,284
Aug-1995 $15,373 $12,843 $1,308
Sep-1995 $15,686 $13,307 $1,330
Oct-1995 $15,254 $13,175 $1,270
Nov-1995 $15,764 $13,843 $1,322
Dec-1995 $16,295 $14,190 $1,354
Jan-1996 $16,453 $14,633 $1,352
Feb-1996 $16,916 $14,743 $1,392
Mar-1996 $17,393 $14,994 $1,417
Apr-1996 $17,898 $15,051 $1,493
May-1996 $18,394 $15,240 $1,551
Jun-1996 $18,260 $15,252 $1,485
Jul-1996 $17,307 $14,676 $1,354
Aug-1996 $18,074 $15,095 $1,431
Sep-1996 $18,468 $15,695 $1,484
Oct-1996 $18,999 $16,302 $1,459
Nov-1996 $19,675 $17,484 $1,518
Dec-1996 $20,291 $17,261 $1,554
Jan-1997 $20,823 $18,098 $1,583
Feb-1997 $20,614 $18,364 $1,543
Mar-1997 $19,853 $17,704 $1,468
Apr-1997 $19,722 $18,447 $1,470
May-1997 $21,235 $19,478 $1,632
Jun-1997 $21,974 $20,313 $1,699
Jul-1997 $22,943 $21,841 $1,776
Aug-1997 $23,373 $21,063 $1,815
Sep-1997 $25,025 $22,336 $1,945
Oct-1997 $24,330 $21,712 $1,857
Nov-1997 $24,210 $22,672 $1,842
Dec-1997 $24,462 $23,334 $1,873
Jan-1998 $23,933 $23,004 $1,843
Feb-1998 $25,063 $24,552 $1,979
Mar-1998 $26,784 $26,054 $2,060
Apr-1998 $27,237 $26,228 $2,069
May-1998 $25,959 $25,839 $1,957
Jun-1998 $25,246 $26,171 $1,960
Jul-1998 $23,330 $25,709 $1,799
Aug-1998 $18,697 $21,883 $1,448
Sep-1998 $19,521 $23,139 $1,558
Oct-1998 $20,187 $24,931 $1,621
Nov-1998 $20,534 $26,093 $1,705
Dec-1998 $20,717 $26,981 $1,810
Jan-1999 $20,522 $27,196 $1,834
Feb-1999 $18,922 $26,813 $1,686
Mar-1999 $19,242 $27,367 $1,712
Apr-1999 $20,976 $29,924 $1,865
May-1999 $20,959 $29,595 $1,892
Jun-1999 $21,927 $30,454 $1,978
Jul-1999 $21,944 $29,562 $1,924
Aug-1999 $21,560 $28,465 $1,853
Sep-1999 $20,975 $27,470 $1,853
Oct-1999 $20,992 $29,051 $1,861
Nov-1999 $21,426 $28,824 $1,972
Dec-1999 $21,141 $28,963 $2,195
Jan-2000 $20,638 $28,019 $2,159
Feb-2000 $19,551 $25,937 $2,516
Mar-2000 $22,510 $29,101 $2,350
Apr-2000 $22,089 $28,763 $2,458
May-2000 $22,871 $29,066 $2,314
Jun-2000 $22,378 $27,738 $2,517
Jul-2000 $22,191 $28,085 $2,438
Aug-2000 $23,279 $29,647 $2,623
Sep-2000 $23,500 $29,919 $2,545
Oct-2000 $24,538 $30,654 $2,432
Nov-2000 $24,265 $29,516 $2,182
Dec-2000 $25,747 $30,995 $2,371
Jan-2001 $26,820 $31,114 $2,494
Feb-2001 $26,444 $30,249 $2,330
Mar-2001 $25,726 $29,181 $2,217
Apr-2001 $27,368 $30,611 $2,390
May-2001 $28,238 $31,300 $2,449
Jun-2001 $27,929 $30,605 $2,533
Jul-2001 $28,324 $30,541 $2,396
Aug-2001 $27,156 $29,316 $2,319
Sep-2001 $25,832 $27,252 $2,007
Oct-2001 $26,296 $27,018 $2,124
Nov-2001 $27,741 $28,587 $2,288
Dec-2001 $28,641 $29,262 $2,430
Jan-2002 $28,433 $29,037 $2,404
Feb-2002 $28,797 $29,083 $2,338
Mar-2002 $29,826 $30,459 $2,526
Apr-2002 $28,438 $29,414 $2,549
May-2002 $28,275 $29,561 $2,436
Jun-2002 $26,005 $27,864 $2,315
Jul-2002 $23,015 $25,273 $1,966
Aug-2002 $23,373 $25,462 $1,961
Sep-2002 $20,557 $22,631 $1,820
Oct-2002 $21,701 $24,308 $1,878
Nov-2002 $23,735 $25,839 $2,046
Dec-2002 $22,026 $24,718 $1,932
Jan-2003 $21,487 $24,120 $1,878
Feb-2003 $21,188 $23,476 $1,822
Mar-2003 $21,340 $23,516 $1,845
Apr-2003 $23,525 $25,585 $2,020
May-2003 $25,114 $27,238 $2,237
Jun-2003 $25,898 $27,578 $2,277
</Table>
TOP 10 HOLDINGS
<Table>
<Caption>
(% OF NET ASSETS)
-----------------
DuPont (E.I.) 2.74%
General Dynamics 2.72%
General Electric 2.67%
Chevron Texaco Corp. 2.63%
Citigroup Inc. 2.61%
Lincoln National 2.59%
Sara Lee Corp. 2.59%
Devon Energy Corp 2.53%
St. Paul Cos. 2.51%
Bristol-Meyers Squibb 2.48%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
Financial 26.4%
Utilities 3.0%
Consumer Discretionary 15.6%
Energy 12.0%
Consumer Non-Durable 4.8%
Health Care 9.9%
Industrials 9.1%
Information Technology 5.1%
Materials 3.7%
Short-Term & Other 3.8%
Telecommunications Services 6.6%
</Table>
2
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
BOND PORTFOLIO
- ------------------------------------------------------------------
OBJECTIVE - Seeks a high level of current income, without undue risk to
principal, by investing in long-term, fixed-income, investment-grade
corporate bonds.
STRATEGY - The Summit Pinnacle Bond Portfolio (the "Portfolio") will
invest at least 80% of asset value in fixed income securities. The fund
will normally invest 75% of the value of its assets in publicly-traded
straight debt securities that fall within the four highest grades as rated
by a national rating agency. Up to 25% of the portfolio may be invested in
below investment grade securities, convertible debt, preferred stock and
other securities.
MANAGER'S COMMENTS:
The Portfolio had a total return of 6.01% (before contract fees and
expenses) for the six-month period ended June 30, 2003 compared to a total
return of 3.93% for the Lehman Brothers Aggregate Bond Index (the
"Index"). The past six months were marked by continued volatility in both
the fixed income and equity market. Interest rates reached historic lows
and provided the fuel for record mortgage refinancing. The strong housing
market coupled with the lowest mortgage rates in 50 years resulted in
homeowners rushing to lock in ever lower rates and cashing out equity to
support consumer spending. Throughout the period, the Federal Reserve sent
the message that it would keep interest rates low as long as necessary to
get the economy growing faster.
The Portfolio's outperformance to the Index was primarily a result of a
shift in asset allocation. During the period, the corporate and mortgage
sectors were increased while decreasing the intermediate U.S. Treasury
sector. Corporate bonds, both investment grade and high yield, were the
best performing sector of the fixed income market during the period. In
general, lower rated credits, lead by high yield bonds, provided the
largest contribution to the incremental return. Individual sectors that
provided the largest positive performance during the period were airline
related and telecom securities. Overall, the mortgage sector
underperformed all major sectors of the Index as consumer prepayments of
mortgages hurt returns. The overweight in corporate bonds more than offset
the mortgage sector underperformance. Outside of the mortgage sector, the
treasury and agency sectors also underperformed along with manufactured
housing in the asset-backed sector.
FUND DATA
<Table>
Managers: Gary R. Rodmaker
Michael J. Schultz
Dave Weisenburger
Inception Date: August 15, 1984
Total Net Assets: $39.06 Million
Number of Holdings: 132
Average Duration: 4.51 years
Average Maturity: 16.8 years
Average Credit Quality: A/A2
Current Yield: 6.05%
</Table>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
Summit Bond Portfolio - Average Annual Total Return
<Table>
<Caption>
1-YEAR 5-YEAR 10-YEAR
9.55% 5.11% 6.93%
</Table>
Past performance is not predictive of future results. Performance does not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or redemption of fund shares. Separate account expenses are
not included.
<Table>
<Caption>
SUMMIT BOND LEHMAN BROTHERS
Portfolio Aggregate Bond Index
Jun-1993 $10,000 $10,000
Jul-1993 $11,336 $10,057
Aug-1993 $11,506 $10,233
Sep-1993 $11,526 $10,261
Oct-1993 $11,618 $10,299
Nov-1993 $11,567 $10,211
Dec-1993 $11,659 $10,266
Jan-1994 $11,876 $10,405
Feb-1994 $11,700 $10,224
Mar-1994 $11,467 $9,971
Apr-1994 $11,359 $9,891
May-1994 $11,369 $9,890
Jun-1994 $11,379 $9,869
Jul-1994 $11,478 $10,065
Aug-1994 $11,478 $10,077
Sep-1994 $11,344 $9,929
Oct-1994 $11,333 $9,920
Nov-1994 $11,322 $9,898
Dec-1994 $11,469 $9,967
Jan-1995 $11,687 $10,164
Feb-1995 $11,961 $10,406
Mar-1995 $12,039 $10,469
Apr-1995 $12,214 $10,616
May-1995 $12,704 $11,027
Jun-1995 $12,774 $11,107
Jul-1995 $12,822 $11,083
Aug-1995 $12,952 $11,217
Sep-1995 $13,071 $11,326
Oct-1995 $13,263 $11,473
Nov-1995 $13,444 $11,645
Dec-1995 $13,652 $11,808
Jan-1996 $13,849 $11,886
Feb-1996 $13,701 $11,679
Mar-1996 $13,676 $11,597
Apr-1996 $13,638 $11,532
May-1996 $13,663 $11,509
Jun-1996 $13,844 $11,664
Jul-1996 $13,883 $11,695
Aug-1996 $13,922 $11,675
Sep-1996 $14,223 $11,878
Oct-1996 $14,474 $12,142
Nov-1996 $14,712 $12,350
Dec-1996 $14,634 $12,235
Jan-1997 $14,714 $12,273
Feb-1997 $14,835 $12,303
Mar-1997 $14,662 $12,167
Apr-1997 $14,813 $12,349
May-1997 $15,004 $12,467
Jun-1997 $15,209 $12,615
Jul-1997 $15,653 $12,956
Aug-1997 $15,528 $12,846
Sep-1997 $15,821 $13,036
Oct-1997 $15,976 $13,225
Nov-1997 $16,075 $13,285
Dec-1997 $16,246 $13,420
Jan-1998 $16,505 $13,591
Feb-1998 $16,505 $13,581
Mar-1998 $16,847 $13,627
Apr-1998 $16,936 $13,698
May-1998 $17,039 $13,828
Jun-1998 $17,157 $13,945
Jul-1998 $17,217 $13,975
Aug-1998 $17,172 $14,202
Sep-1998 $17,430 $14,535
Oct-1998 $17,031 $14,458
Nov-1998 $17,261 $14,540
Dec-1998 $17,306 $14,584
Jan-1999 $17,399 $14,687
Feb-1999 $17,120 $14,430
Mar-1999 $17,291 $14,510
Apr-1999 $17,322 $14,556
May-1999 $17,148 $14,428
Jun-1999 $17,117 $14,382
Jul-1999 $17,069 $14,321
Aug-1999 $17,037 $14,314
Sep-1999 $17,133 $14,480
Oct-1999 $17,117 $14,534
Nov-1999 $17,130 $14,532
Dec-1999 $17,114 $14,463
Jan-2000 $16,998 $14,415
Feb-2000 $17,179 $14,590
Mar-2000 $17,381 $14,782
Apr-2000 $17,280 $14,739
May-2000 $17,097 $14,733
Jun-2000 $17,525 $15,039
Jul-2000 $17,699 $15,176
Aug-2000 $18,010 $15,395
Sep-2000 $17,952 $15,492
Oct-2000 $17,894 $15,595
Nov-2000 $18,107 $15,850
Dec-2000 $18,379 $16,144
Jan-2001 $18,729 $16,409
Feb-2001 $18,963 $16,552
Mar-2001 $19,061 $16,634
Apr-2001 $19,003 $16,564
May-2001 $19,122 $16,664
Jun-2001 $19,061 $16,727
Jul-2001 $19,489 $17,102
Aug-2001 $19,692 $17,298
Sep-2001 $19,591 $17,501
Oct-2001 $20,019 $17,867
Nov-2001 $19,835 $17,620
Dec-2001 $19,631 $17,507
Jan-2002 $19,733 $17,649
Feb-2002 $19,811 $17,820
Mar-2002 $19,691 $17,525
Apr-2002 $20,037 $17,864
May-2002 $20,177 $18,016
Jun-2002 $20,088 $18,172
Jul-2002 $20,160 $18,391
Aug-2002 $20,427 $18,702
Sep-2002 $20,542 $19,005
Oct-2002 $20,265 $18,918
Nov-2002 $20,453 $18,913
Dec-2002 $20,756 $19,304
Jan-2003 $20,743 $19,320
Feb-2003 $21,107 $19,588
Mar-2003 $21,168 $19,572
Apr-2003 $21,494 $19,734
May-2003 $21,914 $20,102
Jun-2003 $22,007 $20,062
</Table>
QUALITY BREAKDOWN
<Table>
<Caption>
(% OF NET PORTFOLIO)
--------------------
AAA 42%
AA 1%
A 9%
BBB 35%
BB 6%
B 5%
CCC 2%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
U.S. Treasuries & Agency Notes 15.7%
Mortgage-Backed Securities 33.1%
Corporate Bonds & Notes 49.6%
Short-Term & Other 1.6%
</Table>
3
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
S&P 500 INDEX PORTFOLIO
- -----------------------------------------------------------------
OBJECTIVE - Seeks investment results that correspond to the total return
performance of U.S. common stocks, as represented by the Standard & Poor's
500 Composite Stock Index.
STRATEGY - The Summit Pinnacle S&P 500 Index Portfolio (the "Portfolio")
will remain fully invested in stocks included in the S&P 500 Index and in
futures contracts on the Index. The cash position will be held in highly
liquid money market instruments to meet redemptions and to provide cash
for future stock purchases.
MANAGER'S COMMENTS:
The objective of the Portfolio is to replicate the performance of the S&P
500 Index (the "Index"), minimizing the difference between the return of
the Index and the return of the Portfolio before contract fees and
expenses. The Portfolio returned 11.44% (before contract fees and
expenses) for the six-month period ended June 30, 2003. The Index, by
comparison, returned 11.76%.
FUND DATA
<Table>
Manager: Team Managed
Inception Date: December 29, 1995
Total Net Assets: $68.75 Million
Number of Equity Holdings: 500
Median Cap Size: $7.49 Billion
Average Price-to-book Ratio: 2.94x
Dividend Yield: 1.67%
</Table>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
Summit S&P 500 Index Portfolio - Average Annual Total Return
<Table>
<Caption>
1-YEAR 5-YEAR
- -0.32% -2.03%
</Table>
Past performance is not predictive of future results. Performance does not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or redemption of fund shares. Separate account expenses are
not included.
<Table>
<Caption>
SUMMIT S&P S&P 500
500 INDEX PORTFOLIO INDEX
Dec-1995 $10,000 $10,000
Jan-1996 $10,400 $10,340
Feb-1996 $10,490 $10,436
Mar-1996 $10,600 $10,537
Apr-1996 $10,740 $10,692
May-1996 $11,021 $10,968
Jun-1996 $11,072 $11,010
Jul-1996 $10,598 $10,523
Aug-1996 $10,820 $10,745
Sep-1996 $11,405 $11,350
Oct-1996 $11,739 $11,663
Nov-1996 $12,600 $12,545
Dec-1996 $12,337 $12,296
Jan-1997 $13,110 $13,065
Feb-1997 $13,221 $13,167
Mar-1997 $12,669 $12,626
Apr-1997 $13,421 $13,379
May-1997 $14,224 $14,195
Jun-1997 $14,852 $14,830
Jul-1997 $16,040 $16,009
Aug-1997 $15,110 $15,113
Sep-1997 $15,947 $15,941
Oct-1997 $15,419 $15,408
Nov-1997 $16,124 $16,121
Dec-1997 $16,373 $16,398
Jan-1998 $16,570 $16,579
Feb-1998 $17,756 $17,774
Mar-1998 $18,662 $18,684
Apr-1998 $18,855 $18,872
May-1998 $18,523 $18,548
Jun-1998 $19,274 $19,300
Jul-1998 $19,081 $19,095
Aug-1998 $16,322 $16,337
Sep-1998 $17,361 $17,384
Oct-1998 $18,773 $18,797
Nov-1998 $19,916 $19,936
Dec-1998 $21,050 $21,084
Jan-1999 $21,914 $21,965
Feb-1999 $21,233 $21,283
Mar-1999 $22,065 $22,134
Apr-1999 $22,905 $22,991
May-1999 $22,349 $22,449
Jun-1999 $23,582 $23,695
Jul-1999 $22,850 $22,955
Aug-1999 $22,740 $22,843
Sep-1999 $22,117 $22,217
Oct-1999 $23,517 $23,623
Nov-1999 $23,975 $24,103
Dec-1999 $25,369 $25,523
Jan-2000 $24,074 $24,241
Feb-2000 $23,616 $23,782
Mar-2000 $25,920 $26,108
Apr-2000 $25,145 $25,323
May-2000 $24,624 $24,803
Jun-2000 $25,227 $25,415
Jul-2000 $24,825 $25,017
Aug-2000 $26,356 $26,571
Sep-2000 $24,959 $25,168
Oct-2000 $24,858 $25,062
Nov-2000 $22,892 $23,086
Dec-2000 $23,004 $23,199
Jan-2001 $23,808 $24,023
Feb-2001 $21,623 $21,834
Mar-2001 $20,250 $20,452
Apr-2001 $21,823 $22,039
May-2001 $21,955 $22,187
Jun-2001 $21,407 $21,648
Jul-2001 $21,194 $21,435
Aug-2001 $19,858 $20,096
Sep-2001 $18,242 $18,474
Oct-2001 $18,576 $18,827
Nov-2001 $19,993 $20,271
Dec-2001 $20,154 $20,449
Jan-2002 $19,846 $20,151
Feb-2002 $19,462 $19,762
Mar-2002 $20,181 $20,505
Apr-2002 $18,950 $19,262
May-2002 $18,801 $19,122
Jun-2002 $17,452 $17,760
Jul-2002 $16,083 $16,377
Aug-2002 $16,183 $16,483
Sep-2002 $14,420 $14,693
Oct-2002 $15,681 $15,985
Nov-2002 $16,593 $16,924
Dec-2002 $15,610 $15,931
Jan-2003 $15,195 $15,515
Feb-2003 $14,960 $15,282
Mar-2003 $15,102 $15,431
Apr-2003 $16,335 $16,701
May-2003 $17,186 $17,579
Jun-2003 $17,397 $17,804
</Table>
TOP 10 HOLDINGS
<Table>
<Caption>
(% OF NET ASSETS)
-------------------
General Electric 3.03%
Microsoft Corporation 2.91%
Pfizer, Inc. 2.85%
Exxon Mobil Corp. 2.54%
Wal-Mart Stores 2.48%
Citigroup Inc. 2.32%
Johnson & Johnson 1.62%
American International Group 1.52%
International Business Machines 1.51%
Merck & Co 1.43%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
Consumer Discretionary 10.5%
Consumer Staples 11.1%
Energy 5.5%
Financials 19.4%
Health Care 14.1%
Industrials 9.9%
Information Technology 15.3%
Materials 2.5%
Telecommunication Services 3.7%
Utilities 2.8%
Short-Term, Futures, & Other 5.2%
</Table>
"Standard & Poor's", "S&P", "S&P 500", "Standard & Poor's 500",
"500", "S&P MidCap 400 Index", and "Standard & Poor's MidCap
400 Index" are trademarks of The McGraw-Hill Companies, Inc.
and have been licensed for use by Summit Mutual Funds, Inc.
The Product is not sponsored, endorsed, sold or promoted by
Standard & Poor's and Standard & Poor's makes no representation
regarding the advisability of investing in the Product.
4
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
S&P MIDCAP 400 INDEX PORTFOLIO
- ------------------------------------------------------------------
OBJECTIVE - Seeks investment results that correspond to the total return
performance of U.S. common stocks, as represented by the Standard & Poor's
MidCap 400 Composite Stock Index (the "Index").
STRATEGY - The Summit Pinnacle S&P MidCap 400 Index Portfolio (the
"Portfolio") will remain fully invested in stocks included in the S&P 400
Index and in futures contracts on the Index. The cash position will be
held in highly liquid money market instruments to meet redemptions and to
provide cash for future stock purchases.
MANAGER'S COMMENTS:
The goal of the Portfolio is to replicate the performance of the Index,
minimizing the difference between the return of the Index and that of the
Portfolio before contract fees and expenses. Index members represent a
diverse group of "medium-sized" companies with a median market
capitalization of approximately $1.7 billion. For the six-month period
ended June 30, 2003, the Portfolio returned 12.07% (before contract fees
and expenses) versus an Index gain of 12.41%.
FUND DATA
<Table>
Manager: Team Managed
Inception Date: May 3, 1999
Total Net Assets: $27.44 Million
Number of Equity Holdings: 400
Median Cap Size: $1.70 Billion
Average Price-to-book Ratio: 2.15x
Dividend Yield: 1.10%
</Table>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
Summit S&P MidCap400 Index Portfolio - Average Annual Total Return
<Table>
<Caption>
1-YEAR 5-YEAR SINCE INCEPTION
- -1.35% 0.28% 4.70%
</Table>
Past performance is not predictive of future results. Performance does not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or redemption of fund shares. Separate account expenses are
not included.
<Table>
<Caption>
PINNACLE S&P
MIDCAP 400 S&P MIDCAP
Index Portfolio 400 Index
Apr-1999 $10,000 $10,000
May-1999 $9,930 $10,043
Jun-1999 $10,430 $10,580
Jul-1999 $10,180 $10,354
Aug-1999 $9,830 $9,999
Sep-1999 $9,500 $9,691
Oct-1999 $9,960 $10,184
Nov-1999 $10,480 $10,719
Dec-1999 $11,114 $11,355
Jan-2000 $10,782 $11,036
Feb-2000 $11,556 $11,808
Mar-2000 $12,513 $12,796
Apr-2000 $11,992 $12,349
May-2000 $11,851 $12,196
Jun-2000 $12,003 $12,375
Jul-2000 $12,187 $12,570
Aug-2000 $13,551 $13,974
Sep-2000 $13,443 $13,878
Oct-2000 $12,966 $13,408
Nov-2000 $12,003 $12,396
Dec-2000 $12,891 $13,343
Jan-2001 $13,172 $13,641
Feb-2001 $12,405 $12,863
Mar-2001 $11,480 $11,908
Apr-2001 $12,731 $13,221
May-2001 $13,029 $13,529
Jun-2001 $12,961 $13,475
Jul-2001 $12,756 $13,274
Aug-2001 $12,334 $12,840
Sep-2001 $10,807 $11,243
Oct-2001 $11,271 $11,741
Nov-2001 $12,102 $12,614
Dec-2001 $12,729 $13,265
Jan-2002 $12,661 $13,198
Feb-2002 $12,666 $13,213
Mar-2002 $13,561 $14,158
Apr-2002 $13,487 $14,092
May-2002 $13,254 $13,854
Jun-2002 $12,270 $12,839
Jul-2002 $11,067 $11,595
Aug-2002 $11,116 $11,653
Sep-2002 $10,215 $10,715
Oct-2002 $10,658 $11,179
Nov-2002 $11,271 $11,825
Dec-2002 $10,801 $11,339
Jan-2003 $10,482 $11,008
Feb-2003 $10,226 $10,746
Mar-2003 $10,307 $10,836
Apr-2003 $11,049 $11,622
May-2003 $11,961 $12,584
Jun-2003 $12,104 $12,744
</Table>
TOP 10 HOLDINGS
<Table>
<Caption>
(% OF NET ASSETS)
-----------------
S&P MidCap 400 Depositary Receipts 3.84%
Gilead Sciences, Inc. 1.17%
M&T Bank Corp. 1.07%
Washington Post 0.75%
Mylan Laboratories 0.71%
Affiliated Computer 0.65%
Express Scripts, Inc. 0.59%
Weatherford International Ltd. 0.59%
IDEC Pharmaceuticals Corporation 0.56%
Lennar Corp. 0.55%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
Consumer Discretionary 14.1%
Consumer Staples 4.0%
Energy 5.9%
Financials 17.2%
Health Care 12.1%
Industrials 9.7%
Information Technology 13.1%
Materials 3.6%
Short-Term, Futures, & Other 13.9%
Telecommunication Services 0.6%
Utilities 5.8%
</Table>
5
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
BALANCED INDEX PORTFOLIO
- -----------------------------------------------------------------
OBJECTIVE - Seeks investment results, with respect to 60% of its assets,
that correspond to the total return performance of U.S. common stocks, as
represented by the S&P 500 Index and, with respect to 40% of its assets,
that correspond to the total return performance of investment grade bonds,
as represented by the Lehman Brothers Aggregate Bond Index.
STRATEGY - The Summit Pinnacle Balanced Index Portfolio (the "Portfolio")
will invest approximately 60% of its nets assets in a portfolio of stocks
included in the S&P 500 Index and in futures of the Index, and
approximately 40% of its net assets in a portfolio of investment grade
bonds designed to track the Lehman Brothers Aggregate Bond Index.
MANAGER'S COMMENTS:
The objective of the Portfolio is to produce investment results, with
respect to 60% of its assets that correspond to the total return
performance of the S&P 500 Index, and, with respect to 40% of its assets,
investment results that correspond to the total return performance of the
Lehman Brothers Aggregate Bond Index. Equities reversed a three year trend
during the six month period ended June 30, 2003 by outperforming the bond
component within the theoretical Index, returning 11.76% versus a gain of
3.93%, respectfully. On a total return basis, the Portfolio returned 8.31%
(before contract fees and expenses) for the six-month period, versus the
theoretical index return of 8.89%.
FUND DATA
<Table>
Manager: Team Managed
Inception Date: May 3, 1999
Total Net Assets: $10.96 Million
Number of Equity Holdings: 500
Median Cap Size: $7.48 Billion
Average Price-to-book Ratio: 2.97x
Dividend Yield: 1.67%
Number of Fixed Income Holdings: 22
Average Duration: 3.87 years
Average Maturity 10.8 years
Average Credit Quality AA+/Aa1
Current Yield 2.90%
</Table>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
Summit Balanced Index Portfolio - Average Annual Total Return
<Table>
<Caption>
1-YEAR 3-YEAR SINCE INCEPTION
4.51% -3.64% -1.09%
</Table>
Past performance is not predictive of future results. Performance does not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or redemption of fund shares. Separate account expenses are
not included.
<Table>
<Caption>
LEHMAN BROTHERS
SUMMIT BALANCED AGGREGATE
Index Portfolio Bond Index S&P 500 Index
Apr-1999 $10,000 $10,000 $10,000
May-1999 $9,740 $9,764 $9,912
Jun-1999 $10,050 $10,306 $9,880
Jul-1999 $9,840 $9,985 $9,839
Aug-1999 $9,810 $9,936 $9,834
Sep-1999 $9,690 $9,663 $9,948
Oct-1999 $10,076 $10,275 $9,985
Nov-1999 $10,197 $10,484 $9,984
Dec-1999 $10,531 $11,101 $9,936
Jan-2000 $10,187 $10,544 $9,903
Feb-2000 $10,108 $10,344 $10,023
Mar-2000 $10,743 $11,356 $10,155
Apr-2000 $10,559 $11,014 $10,126
May-2000 $10,418 $10,788 $10,121
Jun-2000 $10,678 $11,054 $10,332
Jul-2000 $10,613 $10,881 $10,426
Aug-2000 $11,067 $11,557 $10,577
Sep-2000 $10,743 $10,947 $10,643
Oct-2000 $10,743 $10,901 $10,714
Nov-2000 $10,299 $10,041 $10,889
Dec-2000 $10,397 $10,090 $11,091
Jan-2001 $10,678 $10,449 $11,273
Feb-2001 $10,112 $9,497 $11,371
Mar-2001 $9,742 $8,896 $11,428
Apr-2001 $10,168 $9,586 $11,380
May-2001 $10,234 $9,650 $11,448
Jun-2001 $10,088 $9,416 $11,492
Jul-2001 $10,133 $9,323 $11,749
Aug-2001 $9,793 $8,741 $11,884
Sep-2001 $9,363 $8,035 $12,023
Oct-2001 $9,544 $8,189 $12,274
Nov-2001 $9,907 $8,817 $12,105
Dec-2001 $9,941 $8,894 $12,028
Jan-2002 $9,884 $8,765 $12,125
Feb-2002 $9,807 $8,595 $12,243
Mar-2002 $9,939 $8,919 $12,039
Apr-2002 $9,599 $8,378 $12,273
May-2002 $9,581 $8,317 $12,377
Jun-2002 $9,141 $7,725 $12,484
Jul-2002 $8,763 $7,123 $12,635
Aug-2002 $8,854 $7,169 $12,848
Sep-2002 $8,319 $6,391 $13,056
Oct-2002 $8,723 $6,953 $12,997
Nov-2002 $9,060 $7,361 $12,993
Dec-2002 $8,820 $6,929 $13,262
Jan-2003 $8,674 $6,748 $13,273
Feb-2003 $8,641 $6,647 $13,457
Mar-2003 $8,689 $6,712 $13,446
Apr-2003 $9,154 $7,264 $13,557
May-2003 $9,503 $7,646 $13,810
Jun-2003 $9,553 $7,744 $13,782
</Table>
TOP 10 EQUITY HOLDINGS
<Table>
<Caption>
(% OF NET ASSETS)
-------------------
S&P 500 Depositary Receipts 2.10%
General Electric 1.77%
Microsoft Corporation 1.69%
Pfizer, Inc. 1.67%
Exxon Mobil Corp. 1.48%
Wal-Mart Stores 1.47%
Citigroup Inc. 1.35%
Johnson & Johnson 0.95%
American International Group 0.90%
International Business Machines 0.88%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
U.S. Stocks 54.7%
Treasuries & Agency Notes 20.9%
Mortgage-Backed Securities 7.7%
Corporate Bonds 9.2%
Short-Term, Futures, & Other 7.5%
</Table>
6
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NASDAQ-100 INDEX PORTFOLIO
- -----------------------------------------------------------------
OBJECTIVE - Seeks investment results that correspond to the investment
performance of U.S. common stocks, as represented by the Nasdaq-100 Index
(the "Index").
STRATEGY - The Summit Pinnacle Nasdaq-100 Index Portfolio (the
"Portfolio") will remain fully invested in stocks included in the Nasdaq-
100 Index and in futures contracts on the Index. The cash position will be
held in highly liquid money market instruments to meet redemptions and to
provide cash for future stock purchases.
MANAGER'S COMMENTS:
The Index is composed of 100 of the largest non-financial companies listed
on The Nasdaq Stock Market. The objective of the Portfolio is to replicate
the performance of the Index, minimizing the difference between the return
of the Index and the Portfolio before contract fees and expenses. The
Portfolio outperformed more diverse large-cap, mid-cap, and small-cap
indices in the six-month period ended June 30, 2003, gaining 22.09%
(before contract fees and expenses). Comparatively, the Index returned
22.21%.
FUND DATA
<Table>
Manager: Team Managed
Inception Date: April 27, 2000
Total Net Assets: $15.21 Million
Number of Equity Holdings: 100
Median Cap Size: $5.28 Billion
Average Price-to-book Ratio: 4.02x
Dividend Yield: 0.14%
</Table>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
Summit Nasdaq-100 Index Portfolio - Total Return
<Table>
<Caption>
1-YEAR 3-YEAR SINCE INCEPTION
15.08% -31.80% -28.78%
</Table>
Past performance is not predictive of future results. Performance does not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or redemption of fund shares. Separate account expenses are
not included.
<Table>
<Caption>
SUMMIT NASDAQ-
100 INDEX
Portfolio Nasdaq-100 Index
Mar-2000 $10,000 $10,000
Apr-2000 $10,760 $10,763
May-2000 $9,470 $9,482
Jun-2000 $10,730 $10,737
Jul-2000 $10,300 $10,296
Aug-2000 $11,630 $11,633
Sep-2000 $10,170 $10,187
Oct-2000 $9,360 $9,365
Nov-2000 $7,150 $7,152
Dec-2000 $6,670 $6,681
Jan-2001 $7,380 $7,399
Feb-2001 $5,420 $5,446
Mar-2001 $4,470 $4,490
Apr-2001 $5,270 $5,295
May-2001 $5,110 $5,137
Jun-2001 $5,190 $5,224
Jul-2001 $4,770 $4,806
Aug-2001 $4,160 $4,195
Sep-2001 $3,310 $3,335
Oct-2001 $3,860 $3,896
Nov-2001 $4,520 $4,557
Dec-2001 $4,460 $4,503
Jan-2002 $4,380 $4,426
Feb-2002 $3,836 $3,881
Mar-2002 $4,096 $4,149
Apr-2002 $3,600 $3,647
May-2002 $3,406 $3,451
Jun-2002 $2,958 $3,003
Jul-2002 $2,718 $2,748
Aug-2002 $2,662 $2,692
Sep-2002 $2,350 $2,378
Oct-2002 $2,794 $2,827
Nov-2002 $3,162 $3,189
Dec-2002 $2,788 $2,813
Jan-2003 $2,786 $2,809
Feb-2003 $2,864 $2,887
Mar-2003 $2,888 $2,913
Apr-2003 $3,136 $3,163
May-2003 $3,394 $3,426
Jun-2003 $3,404 $3,437
</Table>
TOP 10 HOLDINGS
<Table>
<Caption>
(% OF NET ASSETS)
-----------------
Microsoft Corporation 8.03%
NASDAQ -- 100 Shares 4.38%
Intel Corporation 4.06%
Cisco Systems, Inc. 3.55%
Amgen Inc. 3.41%
QUALCOMM Incorporated 2.89%
Dell Computer Corporation 2.58%
Comcast Corporation 2.44%
Oracle Corporation 2.23%
EBay Inc. 2.10%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
Capital Goods 2.0%
Consumer Services 15.0%
Health Care 12.5%
Public Utilities 2.0%
Technology 45.3%
Short-Term, Futures, & Other 23.2%
</Table>
"Nasdaq" and related marks are trademarks or service marks of
The Nasdaq Stock Market, Inc. and have been licensed for use
for certain purposes by Summit Mutual Funds, Inc. and the
Nasdaq-100 Index Portfolio. Nasdaq makes no warranty, express
or implied, and bears no liability with respect to Summit
Mutual Funds, its use, or any data included therein.
7
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- --------------------------------------------------------------------------------
OBJECTIVE - Seeks investment results that correspond to the investment
performance of U.S. common stocks, as represented by the Russell 2000
Index (the "Index").
STRATEGY - The Summit Pinnacle Russell 2000 Small Cap Index Portfolio will
remain fully invested in stocks included in the Index and in futures
contracts on the Index. The cash position will be held in highly liquid
market instruments to meet redemptions and to provide cash for future
stock purchases.
MANAGER'S COMMENTS:
The Index is a popular proxy for the small cap sector of the equity
markets, with a median market capitalization of approximately $371
million. The objective of the Portfolio is to replicate the performance of
the Index, minimizing the difference between the return of the Index and
that of the Portfolio before contract fees and expenses. For the six-month
period ended June 30, 2003, the Portfolio returned 17.68% (before contract
fees and expenses), versus the Index return of 17.89%.
FUND DATA
<Table>
Manager: Team Managed
Inception Date: April 27, 2000
Total Net Assets: $16.36 Million
Number of Equity Holdings: 1,910
Median Capitalization Size: $371 Million
Average Price-to-book Ratio: 1.97x
Dividend Yield: 1.30%
</Table>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
Summit Russell 2000 Small Cap Index Portfolio - Total Return
<Table>
<Caption>
1-YEAR 3-YEAR SINCE INCEPTION
- -2.25% -3.81% -1.67%
</Table>
Past performance is not predictive of future results. Performance does not
reflect the deduction of taxes that a shareholder would pay on fund
distributions or redemption of fund shares. Separate account expenses are
not included.
<Table>
<Caption>
SUMMIT RUSSELL
2000 SMALL CAP
Index Portfolio Russell 2000 Index
Mar-2000 $10,000 $10,000
Apr-2000 $10,440 $10,456
May-2000 $9,850 $9,846
Jun-2000 $10,650 $10,707
Jul-2000 $10,330 $10,372
Aug-2000 $11,101 $11,158
Sep-2000 $10,770 $10,828
Oct-2000 $10,299 $10,345
Nov-2000 $9,265 $9,283
Dec-2000 $10,039 $10,086
Jan-2001 $10,562 $10,610
Feb-2001 $9,886 $9,915
Mar-2001 $9,412 $9,430
Apr-2001 $10,128 $10,168
May-2001 $10,369 $10,418
Jun-2001 $10,718 $10,777
Jul-2001 $10,105 $10,194
Aug-2001 $9,767 $9,865
Sep-2001 $8,437 $8,537
Oct-2001 $8,933 $9,036
Nov-2001 $9,610 $9,736
Dec-2001 $10,193 $10,337
Jan-2002 $10,087 $10,229
Feb-2002 $9,812 $9,949
Mar-2002 $10,590 $10,748
Apr-2002 $10,689 $10,846
May-2002 $10,209 $10,364
Jun-2002 $9,697 $9,850
Jul-2002 $8,218 $8,363
Aug-2002 $8,188 $8,342
Sep-2002 $7,597 $7,743
Oct-2002 $7,826 $7,991
Nov-2002 $8,523 $8,704
Dec-2002 $8,047 $8,219
Jan-2003 $7,818 $7,992
Feb-2003 $7,580 $7,750
Mar-2003 $7,673 $7,850
Apr-2003 $8,399 $8,594
May-2003 $9,299 $9,517
Jun-2003 $9,478 $9,689
</Table>
TOP 10 HOLDINGS
<Table>
<Caption>
(% OF NET ASSETS)
-----------------
iShares Russell 2000 Index Fund 2.97%
AMR Corp. 0.20%
AnnTaylor Stores Corp. 0.15%
Zale Corp. 0.15%
Affiliated Managers Group 0.15%
OSI Pharmaceuticals Inc. 0.14%
P.F. Chang's China Bistro Inc. 0.14%
First Industrial Realty Trust Inc. 0.14%
Atmos Energy Corp. 0.14%
Techne Corp. 0.14%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
Basic Materials 2.9%
Communications 6.6%
Consumer Cyclical 10.4%
Consumer Non-Cyclical 16.9%
Energy 3.5%
Financial 18.3%
Industrial 11.5%
Technology 8.6%
Utilities 3.1%
Short-Term, Futures, & Other 18.2%
</Table>
The Russell 2000 Index is a trademark/service mark of the Frank
Russell Company. Russell is a trademark of the Frank Russell
Company. Summit Mutual Funds and the Russell 2000 Small Cap
Index Portfolio are not promoted, sponsored or endorsed by,
nor in any way affiliated with Frank Russell Company. Frank
Russell is not responsible for and has not reviewed the
Prospectus, and Frank Russell makes no representation or
warranty, express or implied, as to its accuracy, or \
completeness, or otherwise.
8
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
EAFE INTERNATIONAL INDEX PORTFOLIO
- ----------------------------------------------------------------
OBJECTIVE - Seeks investment results that correspond to the total return
performance of common stocks as represented by the Morgan Stanley Capital
International ("MSCI") EAFE Index (the "EAFE Index"). The EAFE Index
emphasizes the stock of companies in major markets in Europe, Australasia,
and the Far East.
STRATEGY - The Summit Pinnacle EAFE International Index Portfolio (the
"Portfolio") will invest primarily in common stocks of the companies that
compose the EAFE Index.
MANAGER'S COMMENTS:
The Portfolio return for the six-month period ended June 30, 2003 was
7.43% (before contract fees and expenses). In comparison, the return of
the EAFE Index for the same time period was 9.47%. During this time
period, the Portfolio activities included a major rebalance of the
portfolio to mirror the index realignment that has occurred in the Index
and also several major asset shifts.
The performance mirrored investors' expectations that the reduction in
interest rates and a reduction in geopolitical tension that existed in the
Middle East is starting to positively affect world growth and foreign
corporate health. In addition, unclear prospects for U.S. economic growth
and financial asset price growth weakened the U.S. Dollars' currency
performance and helped to improve international equity performance in the
first half of 2003.
The countries in the EAFE Index had good performances. The countries of
New Zealand and Spain were the best performing (up 29.5 % and 25.7%,
respectively, based in U.S. Dollars) for the last six months. The top two
largest country weightings, United Kingdom and Japan, were up 8.0% and
3.1%, respectively. The worst country performers for the last six months
were Japan and the Netherlands, up 3.1% and 2.3%, respectively.
Improving US fundamentals bode well for dollar strengthening and would
make international equities less attractive. However, a rally in European
and Japanese business growth caused by an improving American economic
environment and economic reform in Japan could counterbalance the results
of the strong dollar.
FUND DATA
<Table>
Manager: Subadvised by World Asset
Management, L.L.C.
A division of
Munder Capital Management
Inception Date: November 12, 2002
Total Net Assets: $17.10 Million
Number of Holdings: 262
Median Cap Size: $2.57 Billion
Average Price-to-book Ratio: 1.80x
Dividend Yield: 2.77%
</Table>
TT TOP 10 HOLDINGS
<Table>
<Caption>
(% OF NET ASSETS)
----------------
BP Amoco Plc 3.58%
Vodafone Group Plc 3.07%
HSBC Holdings Plc 2.92%
GlaxoSmithKline Plc 2.80%
Novartis 2.49%
Royal Dutch Petroleum Company 2.24%
Total FinaElf SA 2.19%
Nestle SA 1.90%
Nokia Oyj 1.81%
Royal Bank of Scotland Group Plc 1.77%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
Australia 4.0%
Hong Kong 1.2%
Finland 2.0%
France 10.4%
Germany 6.8%
Italy 4.0%
Japan 15.0%
Netherlands 6.4%
Sweden 2.0%
United Kingdon 32.0%
Switzerland 9.0%
Spain 4.2%
Short-Term & Other 3.0%
</Table>
The EAFE International Index Portflio is not sponsored,
endorsed, sold or promoted by MSCI or any affiliate of MSCI.
Neither MSCI nor any other party makes any representation
or warranty, express or implied to Summit Mutual Funds, Inc.
or any member to the public regarding the advisability of
investing in funds generally or in this fund particularly
or the ability of the EAFE index to track general stock
market performance.
9
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
LEHMAN AGGREGATE BOND INDEX PORTFOLIO
- -----------------------------------------------------------------
OBJECTIVE - Seeks investment results that correspond to the total return
performance of the bond market, as represented by the Lehman Brothers
Aggregate Bond Index (the "Index").
STRATEGY - The Summit Pinnacle Lehman Aggregate Bond Index Portfolio (the
"Portfolio") will invest at least 80% of the value of its assets in
obligations issued or guaranteed by the U.S. Government, publicly -traded
debt securities rated BBB- or BAA3 or higher by a national rating agency,
or cash and cash equivalents. Up to 20% of the Portfolio's total assets
may be invested in financial futures or options contracts. The Portfolio
will not purchase bonds rated below investment grade.
MANAGER'S COMMENTS:
The Portfolio commenced operations on April 1, 2003. The objective of the
Portfolio is to replicate the performance of the Index, minimizing the
difference between the return of the Index and the return of the Portfolio
before contract fees and expenses. The Portfolio returned 2.44% for the
three-month period ended June 30, 2003 (before contract fees and
expenses). The underlying Index, by comparison, returned 2.50%.
FUND DATA
<Table>
Manager: Team Managed
Inception Date: April 1, 2003
Total Net Assets: $10.31 Million
Number of Holdings: 41
Average Duration: 4.2 years
Average Maturity: 13.9 years
Average Credit Quality: AAA/Aaa
Current Yield: 3.07%
</Table>
QUALITY BREAKDOWN
<Table>
<Caption>
(% OF PORTFOLIO)
AAA 73%
AA 4%
A 17%
BBB 6%
</Table>
SECTOR ALLOCATIONS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<Table>
U.S. Treasuries & Agency Notes 66.8%
Mortgage-Backed Securities 2.1%
Corporate Bonds & Notes 26.9%
Short-Term & Other 4.2%
</Table>
10
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
STATEMENTS OF ASSETS AND LIABILITIES
- ------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
S&P 500 S&P MIDCAP
ZENITH BOND INDEX 400 INDEX
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- ---------
ASSETS
Investments in securities,
at value (cost $40,667,696;
$37,727,961; $52,829,173;
$27,297,880) $41,783,934 $38,881,433 $68,870,958 $27,258,644
Cash 11,381 567,209 -- 157,979
Collateral for securities
Loaned, at fair value
(Note 3) 3,234,520 11,156,266 5,160,918 4,298,162
Receivables:
Shares sold 6,621 1,653 6,441 45,427
Securities sold -- 66,581 -- 80,807
Interest and dividends 74,031 478,392 84,303 17,334
Variation margin -- -- -- --
Receivable from Adviser -- -- -- --
Prepaid expenses and other 4,717 1,397 5,661 1,789
---------- ---------- ---------- ----------
45,115,204 51,152,931 74,128,281 31,860,142
---------- ---------- ---------- ----------
LIABILITIES
Payables:
Investment securities -- 728,543 98,700 62,880
purchased
Shares redeemed 6,028 36,362 5,299 4,790
Payable upon return of
securities loaned
(Note 3) 3,234,520 11,156,266 5,160,918 4,298,162
Bank overdraft -- -- 20,464 --
Investment advisory fees 18,769 15,185 18,469 8,343
Administration expenses 6,764 4,732 5,725 2,250
Custodian and fund
accounting fees 10,196 12,839 24,327 16,232
Professional fees 8,780 7,403 10,855 7,699
Variation margin -- -- -- 8,960
Deferred director's
compensation -- 115,072 -- --
Directors fees 3,534 2,026 4,852 1,864
Royalty -- -- 17,108 3,777
Other accrued expenses 8,500 9,836 14,415 5,055
----------- ----------- ----------- -----------
3,297,091 12,088,264 5,381,132 4,420,012
----------- ----------- ----------- -----------
NET ASSETS
Paid-in capital 44,800,393 43,485,056 56,014,898 29,128,784
Undistributed net
investment income 232,172 371,285 285,956 56,159
Accumulated net realized
gain / (loss) on
investments and
futures contracts (4,330,690) (5,945,146) (3,479,740) (1,646,102)
Net unrealized appreciation/
(depreciation) on
investments, futures
contracts, and foreign
currency translations 1,116,238 1,153,472 15,926,035 (98,711)
----------- ----------- ----------- -----------
$41,818,113 $39,064,667 $68,747,149 $27,440,130
=========== =========== =========== ===========
Shares authorized
($.10) par value 40,000,000 30,000,000 30,000,000 20,000,000
Shares outstanding 597,007 789,796 1,078,316 626,015
Net asset value,
offering and redemption
price per share $70.05 $49.46 $63.75 $43.83
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
11
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
RUSSELL LEHMAN
2000 EAFE AGGREGATE
BALANCED NASDAQ-100 SMALL CAP INTERNATIONAL BOND
INDEX INDEX INDEX INDEX INDEX
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- --------- ---------
ASSETS
Investments in securities,
at value (cost $12,506,437;
$20,100,083; $17,073,428;
$15,818,172; $10,143,986) $11,122,869 $15,182,256 $16,492,707 $17,036,002 $10,311,490
Cash -- 49,792 179,264 132 2,259
Collateral for securities
loaned, at fair value
(Note 3) 1,985,111 1,319,606 2,037,361 1,162,146 3,707,579
Receivables:
Shares sold 3,954 31,044 57,597 -- 4,108
Securities sold -- -- 2,876,211 -- --
Interest and dividends 54,170 892 14,995 57,696 103,644
Variation margin 1,034 4,120 9,715 -- --
Receivable from Adviser 2,194 522 10,530 102,222 4,527
Prepaid expenses and other 674 3,962 1,763 136 135
----------- ----------- ----------- ----------- -----------
13,170,006 16,592,194 21,680,143 8,358,334 14,133,742
----------- ----------- ----------- ----------- -----------
LIABILITIES
Payables:
Investment securities
purchased 186,637 30,070 3,230,292 -- 99,521
Shares redeemed 3,690 5,270 2,145 1,999 1
Payable upon return of
securities loaned
(Note 3) 1,985,111 1,319,606 2,037,361 1,162,146 3,707,579
Bank overdraft 9,743 -- -- -- --
Investment advisory fees -- -- -- -- --
Administration expenses -- -- -- -- --
Custodian and fund
accounting fees 9,129 10,206 36,520 67,373 11,375
Professional fees 7,769 7,096 8,547 9,620 4,077
Variation margin -- -- -- -- --
Deferred director's
compensation -- -- -- -- --
Directors fees 932 1,040 742 1,110 409
Royalty 1,286 -- 1,506 11,960 --
Other accrued expenses 2,655 4,867 3,129 7,239 3,617
----------- ----------- ----------- ----------- -----------
2,206,952 1,378,155 5,320,242 1,261,447 3,826,579
----------- ----------- ----------- ----------- -----------
NET ASSETS
Paid-in capital 12,781,789 26,939,854 18,418,548 16,329,228 10,102,970
Undistributed net
investment income 35,821 (19,213) 42,798 272,678 36,689
Accumulated net realized
gain/(loss) on
investments and
futures contracts (450,688) (6,704,165) (1,474,179) (722,849) --
Net unrealized appreciation/
(depreciation) on
investments, futures
contracts, and foreign
currency translations (1,403,868) (5,002,437) (627,266) 1,217,830 167,504
----------- ----------- ----------- ----------- -----------
$10,963,054 $15,214,039 $16,359,901 $17,096,887 $10,307,163
=========== =========== =========== =========== ===========
Shares authorized
($.10) par value 20,000,000 20,000,000 20,000,000 20,000,000 20,000,000
Shares outstanding 273,643 893,885 373,587 328,082 202,030
Net asset value,
offering and redemption
price per share $40.06 $17.02 $43.79 $52.11 $51.02
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
12
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
STATEMENTS OF OPERATIONS
- -----------------------------------------------------------------------------
FOR THE PERIOD ENDED JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
S&P
S&P 500 MIDCAP
ZENITH BOND INDEX 400 INDEX
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
---------- ---------- ---------- ----------
INVESTMENT INCOME
Interest $ 3,389 $1,227,348 $ 9,218 $ 7,103
Dividends (net of foreign
withholding taxes of $0;
$0; $14; $0) 466,466 -- 549,448 132,888
Other income 540 5,328 1,425 1,211
---------- ---------- ---------- ----------
470,395 1,232,676 560,091 141,202
---------- ---------- ---------- ----------
EXPENSES
Investment advisory fees 120,514 87,996 95,432 35,295
Administration expenses 18,830 18,723 31,810 13,732
Custodian fees and expenses 1,965 3,645 5,062 --
Fund accounting fees 15,379 23,007 17,176 18,774
Professional fees 9,025 8,360 6,274 9,081
Directors' fees 4,200 2,916 4,039 2,272
Transfer agent fees 3,437 3,385 3,412 1,773
Royalty fee -- -- 6,199 1,140
Other 9,017 6,378 9,867 3,410
---------- ---------- ---------- ----------
182,367 154,410 179,271 85,477
Expense reimbursement and
waivers -- (13,991) (159) (14,877)
---------- ---------- ---------- ----------
182,367 140,419 179,112 70,600
---------- ---------- ---------- ----------
NET INVESTMENT INCOME / (LOSS) 288,028 1,092,257 380,979 70,602
---------- ---------- ---------- ----------
REALIZED AND UNREALIZED GAIN /
(LOSS)
Net realized gain / (loss)
on investments and options (1,994,385) 475,843 (791,736) 17,311
Net realized gain / (loss)
on futures contracts -- -- 535,713 216,155
---------- ---------- ---------- ----------
(1,994,385) 475,843 (256,023) 233,466
Net change in unrealized
appreciation /
(depreciation) on
investments, futures
contracts, and foreign
currency translations 7,915,440 668,401 6,883,841 2,571,812
---------- ---------- ---------- ----------
NET REALIZED AND UNREALIZED
GAIN / (LOSS) 5,921,055 1,144,244 6,627,818 2,805,278
---------- ---------- ---------- ----------
NET INCREASE / (DECREASE) IN
NET ASSETS FROM OPERATIONS $6,209,083 $2,236,501 $7,008,797 $2,875,880
========== ========== ========== ==========
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
13
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
STATEMENTS OF OPERATIONS
- -------------------------------------------------------------------------
FOR THE PERIOD ENDED JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
LEHMAN
RUSSELL 2000 EAFE AGGREGATE
BALANCED NASDAQ-100 SMALL CAP INTERNATIONAL BOND
INDEX INDEX INDEX INDEX INDEX
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- ----------- --------------- ------------- ----------
INVESTMENT INCOME
Interest $111,304 $ 9,024 $ 10,281 $ 174 $ 91,387
Dividends (net of
foreign withholding
taxes of $0; $62;
$14; $0; $0) 51,157 9,790 83,646 321,140 --
Other income 760 446 2,273 8,810 379
-------- ---------- ---------- ---------- --------
163,221 19,260 96,200 330,124 91,766
-------- ---------- ---------- ---------- --------
EXPENSES
Investment advisory
fees 15,717 20,716 24,196 51,221 7,635
Administration expenses 5,239 5,919 6,913 9,147 2,545
Custodian fees and
expenses 443 2,360 11,480 87,004 546
Fund accounting fees 19,496 15,837 33,675 39,705 10,829
Professional fees 8,281 7,620 9,889 6,380 4,095
Directors' fees 1,022 1,207 722 624 410
Transfer agent fees 1,539 6,382 1,484 6,539 3,094
Royalty fees 393 2,480 2,480 9,412 --
Other 1,935 2,367 2,559 1,251 523
-------- ---------- ---------- ---------- --------
54,065 64,888 93,398 211,283 29,677
Expense reimbursements
and waivers (22,630) (26,415) (41,640) (151,832) (14,707)
-------- ---------- ---------- ---------- --------
31,435 38,473 51,758 59,451 14,970
-------- ---------- ---------- ---------- --------
NET INVESTMENT INCOME /
(LOSS) 131,786 (19,213) 44,442 270,673 76,796
-------- ---------- ---------- ---------- --------
REALIZED AND UNREALIZED
GAIN / (LOSS)
Net realized gain /
(loss) on
investments and
options 92,909 (76,992) (697,176) (667,268) --
Net realized gain /
(loss) on futures
contracts 73,175 236,828 295,230 -- --
-------- ---------- ---------- ---------- --------
166,084 159,836 (401,946) (667,268) --
Net change in
unrealized
appreciation /
(depreciation) on
investments, futures
contracts, and
foreign currency
translations 548,516 2,194,079 2,704,493 1,183,687 167,504
-------- ---------- ---------- ---------- --------
NET REALIZED AND
UNREALIZED GAIN /
(LOSS) 714,600 2,353,915 2,302,547 516,419 167,504
-------- ---------- ---------- ---------- --------
NET INCREASE / (DECREASE)
IN NET ASSETS FROM
OPERATIONS $846,386 $2,334,702 $2,346,989 $ 787,092 $244,300
======== ========== ========== ========== ========
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
14
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
STATEMENTS OF CHANGES IN NET ASSETS
- -----------------------------------------------------------------------------
<Table>
<Caption>
ZENITH BOND
PORTFOLIO PORTFOLIO
-------------------------------- ---------------------------------
FOR THE SIX MONTHS FOR THE SIX MONTHS
ENDED JUNE 30, YEAR ENDED ENDED JUNE 30, YEAR ENDED
(UNAUDITED) DECEMBER 31, (UNAUDITED) DECEMBER 31,
------------------ ------------ ------------------ -------------
2003 2002 2003 2002
------------------ ------------ ------------------ -------------
OPERATIONS
Net investment income /
(loss) $ 288,028 $ 720,818 $ 1,092,257 $ 1,878,419
Net realized gain /
(loss) on
investments and
futures (1,994,385) (818,365) 475,843 (1,174,217)
Net change of
unrealized
appreciation /
(depreciation) on
investments, futures
contracts, and
foreign currency
translations 7,915,440 (12,680,045) 668,401 1,087,609
----------- ------------ ----------- -----------
6,209,083 (12,777,592) 2,236,501 1,791,811
----------- ------------ ----------- -----------
DISTRIBUTIONS TO
SHAREHOLDERS
Net investment income (55,856) (907,305) (1,018,869) (1,934,326)
Return of capital -- (2,544,857) -- --
Net realized gain on
investments -- -- -- --
----------- ------------ ----------- -----------
(55,856) (3,452,162) (1,018,869) (1,934,326)
----------- ------------ ----------- -----------
FUND SHARE TRANSACTIONS
Proceeds from shares
sold 542,691 3,515,446 4,285,599 10,893,733
Reinvestment of
distributions 55,856 3,452,162 1,018,869 1,934,302
Payments for shares
redeemed (3,151,537) (7,081,517) (2,872,870) (6,416,712)
----------- ------------ ----------- -----------
(2,552,990) (113,909) 2,431,598 6,411,323
----------- ------------ ----------- -----------
NET INCREASE / (DECREASE)
IN NET ASSETS 3,600,237 (16,343,663) 3,649,230 6,268,808
NET ASSETS
Beginning of period 38,217,876 54,561,539 35,415,437 29,146,629
----------- ------------ ----------- -----------
End of period $41,818,113 $ 38,217,876 $39,064,667 $35,415,437
=========== ============ =========== ===========
UNDISTRIBUTED NET
INVESTMENT INCOME /
(LOSS) $ 232,172 $ -- $ 371,285 $ 297,898
=========== ============ =========== ===========
FUND SHARE TRANSACTIONS
Sold 8,511 47,130 88,854 227,441
Reinvestment of
distributions 974 43,549 21,086 40,827
Redeemed (52,991) (109,532) (58,996) (134,557)
----------- ------------ ----------- -----------
Net increase /
(decrease) from
fund share
transactions (43,506) (18,853) 50,944 133,711
=========== ============ =========== ===========
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
15
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<Table>
<Caption>
S&P 500 S&P MIDCAP 400
INDEX PORTFOLIO INDEX PORTFOLIO
-------------------------------- ---------------------------------
FOR THE SIX MONTHS FOR THE SIX MONTHS
ENDED JUNE 30, YEAR ENDED ENDED JUNE 30, YEAR ENDED
(UNAUDITED) DECEMBER 31, (UNAUDITED) DECEMBER 31,
------------------ ------------ ------------------ -------------
2003 2002 2003 2002
------------------ ------------- ------------------ -------------
OPERATIONS
Net investment income/
(loss) $ 380,979 $ 803,535 $ 70,602 $ 125,139
Net realized gain /
(loss) on
investments and
futures (256,023) (2,853,281) 233,466 (985,805)
Net change of
unrealized
appreciation /
(depreciation) on
investments, futures
contracts, and
foreign currency
translations 6,883,841 (18,572,961) 2,571,812 (3,831,104)
----------- ------------ ----------- ------------
7,008,797 (20,622,707) 2,875,880 (4,691,770)
----------- ------------ ----------- ------------
DISTRIBUTIONS TO
SHAREHOLDERS
Net investment income (639,600) (474,970) (99,103) (107,543)
Return of capital -- -- -- --
Net realized gain on
investments -- (131,130) -- (78,555)
----------- ------------ ----------- ------------
(639,600) (606,100) (99,103) (186,098)
----------- ------------ ----------- ------------
FUND SHARE TRANSACTIONS
Proceeds from shares
sold 1,696,680 5,556,938 3,678,300 17,798,629
Reinvestment of
distributions 639,600 606,100 99,103 186,098
Payments for shares
redeemed (4,296,508) (13,234,591) (2,294,258) (10,514,264)
----------- ------------ ----------- ------------
(1,960,228) (7,071,553) 1,483,145 7,470,463
----------- ------------ ----------- ------------
NET INCREASE / (DECREASE)
IN NET ASSETS 4,408,969 (28,300,360) 4,259,922 2,592,595
NET ASSETS
Beginning of period 64,338,180 92,638,540 23,180,208 20,587,613
----------- ------------ ----------- ------------
End of period $68,747,149 $ 64,338,180 $27,440,130 $ 23,180,208
=========== ============ =========== ============
UNDISTRIBUTED NET
INVESTMENT INCOME /
(LOSS) $ 285,956 $ 544,576 $ 56,159 $ 84,660
=========== ============ =========== ============
FUND SHARE TRANSACTIONS
Sold 28,708 84,204 91,853 391,814
Reinvestment of
distributions 11,667 8,222 2,676 4,246
Redeemed (74,786) (212,256) (58,483) (247,116)
----------- ------------ ----------- ------------
Net increase /
(decrease) from
fund share
transactions (34,411) (119,830) 36,046 148,944
=========== ============ =========== ============
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
16
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<Table>
<Caption>
BALANCED NASDAQ-100 RUSSELL 2000 SMALL CAP
INDEX PORTFOLIO INDEX PORTFOLIO INDEX PORTFOLIO
------------------------ ------------------------ ------------------------
FOR THE FOR THE FOR THE
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
JUNE 30, YEAR ENDED JUNE 30, YEAR ENDED JUNE 30, YEAR ENDED
(UNAUDITED) DECEMBER 31, (UNAUDITED) DECEMBER 31, (UNAUDITED) DECEMBER 31,
----------- ----------- ----------- ----------- ----------- -----------
2003 2002 2003 2002 2003 2002
----------- ----------- ----------- ----------- ----------- -----------
OPERATIONS
Net investment
income/(loss) $ 131,786 $ 324,370 $ (19,213) $ (47,602) $ 44,442 $ 106,905
Net realized
gain /
(loss) on
investments
and futures 166,084 (445,709) 159,836 (4,251,507) (401,946) (945,271)
Net change of
unrealized
appreciation/
(depreciation)
on investments,
futures
contracts, and
foreign
currency
translations 548,516 (1,339,408) 2,194,079 (1,62,997) 2,704,493 (2,695,177)
----------- ----------- ----------- ----------- ----------- -----------
846,386 (1,460,747) 2,334,702 (5,912,106) 2,346,989 (3,533,543)
----------- ----------- ----------- ----------- ----------- -----------
DISTRIBUTIONS TO
SHAREHOLDERS
Net investment
income (143,423) (426,657) -- -- (103,286) (37,807)
Return of
capital -- -- -- -- -- --
Net realized
gain on
investments -- -- -- -- -- (194,517)
----------- ----------- ----------- ----------- ----------- -----------
(143,423) (426,657) -- -- (103,286) (232,324)
----------- ----------- ----------- ----------- ----------- -----------
FUND SHARE
TRANSACTIONS
Proceeds from
Shares sold 458,484 1,088,368 8,206,899 1,665,414 3,724,776 11,318,388
Reinvestment of
distributions 143,423 426,657 -- -- 103,286 232,324
Payments for
shares
redeemed (980,210) (1,993,364) (4,910,425) (10,730,045) (3,574,527) (15,425,239)
----------- ----------- ----------- ----------- ----------- -----------
(378,303) (478,339) 3,296,474 935,369 253,535 (3,874,527)
----------- ----------- ----------- ----------- ----------- -----------
NET INCREASE/
(DECREASE)
IN NET ASSETS 324,660 (2,365,743) 5,631,176 (4,976,737) 2,497,238 (7,640,394)
NET ASSETS
Beginning
of period 10,638,394 13,004,137 9,582,863 14,559,600 13,862,663 21,503,057
----------- ----------- ----------- ----------- ----------- -----------
End of period $10,963,054 $10,638,394 $15,214,039 $ 9,582,863 $16,359,901 $13,862,663
=========== =========== =========== =========== =========== ===========
UNDISTRIBUTED NET
INVESTMENT
INCOME/(LOSS) $ 35,821 $ 47,456 $ (19,213) $ -- $ 42,798 $ 101,642
=========== =========== =========== =========== =========== ===========
FUND SHARE
TRANSACTIONS
Sold 11,910 26,671 532,538 709,684 93,353 261,165
Reinvestment of
distributions 3,830 10,727 -- -- 2,947 5,023
Redeemed (25,817) (50,078) (326,049) (675,831) (92,226) (343,659)
----------- ----------- ----------- ----------- ----------- -----------
Net increase/
(decrease) from
fund share
transactions (10,077) (12,680) 206,489 33,853 4,074 (77,471)
=========== =========== =========== =========== =========== ===========
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
17
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------
<Table>
<Caption>
EAFE INTERNATIONAL LEHMAN AGGREGATE BOND
INDEX PORTFOLIO INDEX PORTFOLIO
------------------------------------- ---------------------
FOR THE SIX MONTHS PERIOD FROM PERIOD FROM APRIL 1,
ENDED JUNE 30, NOVEMBER 12, 2002 2003 TO JUNE 30,
(UNAUDITED) TO DECEMBER 31, (UNAUDITED)
------------------ ----------------- ---------------------
2003 2002 2003
------------------ ------------------ ---------------------
OPERATIONS
Net investment income /
(loss) $ 270,673 $ 87,181 $ 76,796
Net realized gain /
(loss) on
investments and
futures (667,268) 313,314 --
Net change of
unrealized
appreciation /
(depreciation) on
investments, futures
contracts, and
foreign currency
translations 1,183,687 34,141 167,504
------------ ------------ -----------
787,092 434,636 244,300
------------ ------------ -----------
DISTRIBUTIONS TO
SHAREHOLDERS
Net investment income (85,175) -- (40,107)
Return of capital -- -- --
Net realized gain on
investments (368,895) -- --
------------ ------------ -----------
(454,070) -- (40,107)
------------ ------------ -----------
FUND SHARE TRANSACTIONS
Proceeds from shares
sold 9,883,312 39,392,251 10,062,955
Reinvestment of
distributions 454,070 -- 40,107
Payments for shares
redeemed (15,807,069) (17,593,335) (92)
------------ ------------ -----------
(5,469,687) 21,798,916 10,102,970
------------ ------------ -----------
NET INCREASE / (DECREASE)
IN NET ASSETS (5,136,665) 22,233,552 10,307,163
NET ASSETS
Beginning of period 22,233,552 -- --
------------ ------------ -----------
End of period $ 17,096,887 $ 22,233,552 $10,307,163
============ ============ ===========
UNDISTRIBUTED NET
INVESTMENT INCOME /
(LOSS) $ 272,678 $ 87,181 $ 36,689
============ ============ ===========
FUND SHARE TRANSACTIONS
Sold 208,614 787,893 201,240
Reinvestment of
distributions 10,026 -- 792
Redeemed (338,909) (339,538) (2)
------------ ------------ -----------
Net increase /
(decrease) from
fund share
transactions (120,269) 448,355 202,030
============ ============ ===========
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
18
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
ZENITH PORTFOLIO SCHEDULE OF INVESTMENTS
- -----------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
SHARES VALUE
COMMON STOCKS - 97.09%
CONSUMER DISCRETIONARY - 15.56%
Abercrombie & Fitch Co.* 20,800 $ 590,928
AOL Time Warner Inc.* 61,300 986,317
Comcast Corporation* 22,600 651,558
Delta Air Lines 33,300 488,844
FedEx Corporation 10,000 620,300
Knight-Ridder Inc. 11,700 806,481
McDonald's Corp.* 39,200 864,752
Sears, Roebuck & Co. 22,800 766,992
Target Corp. 19,300 730,312
--------------
6,506,484
--------------
CONSUMER NON-DURABLE - 4.75%
Altria Group Inc. 19,900 904,256
Sara Lee Corp.* 57,500 1,081,575
--------------
1,985,831
--------------
ENERGY - 12.04%
Anadarko Petroleum 23,300 1,036,151
ChevronTexaco Corp. 15,219 1,098,812
ConocoPhillips 18,271 1,001,251
Devon Energy Corp* 19,800 1,057,320
Marathon Oil Corp. 32,000 843,200
--------------
5,036,734
--------------
FINANCIALS - 26.45%
American Express 19,500 815,295
Banc One Corp 26,200 974,116
Bank of America Corp.* 8,100 640,143
Citigroup Inc. 25,500 1,091,400
A.G. Edwards 24,700 844,740
Fleet Boston Financial Group 27,152 806,686
John Hancock Financial Services* 13,900 427,147
J.P. Morgan Chase & Co. 15,850 541,753
KeyCorp 35,100 886,977
Lincoln National 30,400 1,083,152
Merrill Lynch 13,500 630,180
Raymond James Financial Corp 12,800 423,040
St. Paul Cos. 28,700 1,047,837
XL Capital 10,200 846,600
--------------
11,059,066
--------------
HEALTH CARE - 9.88%
Amerisourcebergen Corp. 12,200 846,070
Baxter International Inc.* 32,400 842,400
Beckman Coulter Inc. 14,600 593,344
Bristol-Myers Squibb 38,200 1,037,130
Merck & Co. 13,400 811,370
--------------
4,130,314
--------------
<Caption>
SHARES VALUE
INDUSTRIALS - 9.12%
Caterpillar Inc. 12,300 $ 684,618
Gerenal Dynamics* 15,700 1,138,250
General Electric 39,000 1,118,520
SPX Corp.* 19,800 872,388
--------------
3,813,776
--------------
INFORMATION TECHNOLOGY - 5.08%
Hewlett-Packard 28,500 607,050
International Business Machines 8,300 684,750
Motorola Inc. 88,300 832,669
--------------
2,124,469
--------------
MATERIALS - 3.66%
Alcoa Inc
Dow Chemical 12,500 387,000
Du Pont (E.I.) 27,500 1,145,100
--------------
1,532,100
--------------
TECHNOLOGY - 0.92%
Nokia Corp* 23,600 387,748
--------------
TELECOMMUNICATION SERVICES - 6.61%
AT&T Wireless Services* 65,100 534,471
SBC Communications Inc 16,600 424,130
Cox Communications Inc* 25,500 813,450
Verizon Communications 25,100 990,195
--------------
2,762,246
--------------
UTILITIES - 3.02%
Ameren Corporation 15,600 687,960
Great Plains Energy Inc. 19,900 574,712
--------------
1,262,672
--------------
Total Common Stocks
(cost $39,485,202) 40,601,440
--------------
SHORT-TERM INVESTMENTS - 2.83%
NORTHERN TRUST DIVERSIFIED ASSETS
PORTFOLIO - 2.83% 1,182,494 $ 1,182,494
--------------
Total Short-Term Investments
(cost $1,182,494) 1,182,494
--------------
TOTAL INVESTMENTS - 99.92%
(cost $40,667,696)(1) 41,783,934
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(2) - 7.73% 3,234,520
--------------
OTHER ASSETS AND LIABILITIES - (7.65%) (3,200,341)
--------------
TOTAL NET ASSETS - 100.00% $ 41,818,113
==============
</Table>
- -------------
* Non-income producing
(1) For federal income tax purposes, cost is $40,906,373 and gross
unrealized appreciation and depreciation of securities as of
June 30, 2003 was $3,422,981 and ($2,545,420), respectively.
(2) This security was purchased with cash collateral held from
securities lending.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
19
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS BOND PORTFOLIO
- ------------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
SHARES VALUE
COMMON STOCKS - 0.14%
COMMUNICATIONS & MEDIA - 0.14%
Evercom Inc.(2) 6,363 $ 54,085
--------------
Total Common Stocks
(cost $125,000) 54,085
--------------
<Caption>
PRINCIPAL VALUE
U.S. TREASURY OBLIGATIONS - 11.53%
U.S. TREASURY NOTES & BONDS - 11.53%
5.875% due 11/15/05 $ 1,650,000 $ 1,820,737
5.500% due 05/15/09 750,000 863,848
5.000% due 02/15/11 740,000 830,621
4.875% due 02/15/12 500,000 555,781
4.000% due 11/15/12 200,000 208,117
3.625% due 05/15/13 225,000 226,758
--------------
Total U.S. Treasury Obligations
(cost $4,154,568) 4,505,862
--------------
U.S. GOVERNMENT AGENCY OBLIGATIONS -
4.23%
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 4.23%
1.875% due 12/15/04 500,000 504,503
5.750% due 03/15/09 1,000,000 1,148,613
--------------
Total U.S Government Agency
Obligations
(cost $1,601,280) 1,653,116
--------------
SOVEREIGN GOVERNMENT BONDS - 0.68%
Republic of Chile
(5.500% due 01/15/13) 250,000 264,500
--------------
Total Sovereign Government Bonds
(cost $247,728) 264,500
--------------
MORTGAGE-BACKED SECURITIES - 7.84%
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 6.97%
5.500% due 05/01/12 421,464 441,826
6.000% due 06/01/16 540,846 564,500
4.500% due 03/01/17 1,055,679 1,079,448
5.000% due 05/01/18 249,067 257,470
6.500% due 02/01/29 267,840 279,689
5.000% due 02/01/33 99,347 101,094
--------------
2,724,027
--------------
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION - 0.87%
6.500% due 10/15/28 323,576 340,274
--------------
Total Mortgage-Backed Securities
(cost $2,899,946) 3,064,301
--------------
COLLATERALIZED MORTGAGE OBLIGATIONS - 22.13%
AGENCY SECTOR - 11.74%
FHR 2439 SC
(16.608% due 07/15/28) 159,094 168,134
<Caption>
PRINCIPAL VALUE
AGENCY SECTOR - 11.74% (CONTINUED)
FNR 2001-45 VK
(6.500% due 09/25/18) $ 2,131,000 $ 2,209,830
FNR 2002-48 GF
(6.500% due 10/25/31) 2,083,000 2,208,126
--------------
4,586,090
--------------
PRIVATE SECTOR - 10.39%
ABN Amro Mortgage Corp.
(6.600% due 09/25/16) 296,988 303,489
CF First Boston
(6.250% due 09/25/32) 160,767 167,714
CMSI 2001-14 B2
(6.613% due 09/25/31) 169,088 174,084
BOAMS 01-4 2B2
(6.750% due 04/20/31) 509,428 527,574
BOAMS 2002-4 1A4
(6.500% due 04/25/32) 69,458 70,649
BOAMS 2002-6 2B1
(6.000% due 07/25/32) 119,791 123,115
BOAMS 2002-7 2B3
(6.000% due 08/25/32) 130,792 134,512
BOAMS 2002-8 2b1
(5.750% due 09/25/17) 205,489 211,777
ICIFC 1997-2 B1
(8.000% due 07/25/28) 269,492 269,190
NMFC 1998-4 B3
(6.250% due 10/25/28) 311,535 319,307
RALI 2001-QS15 M3
(6.750% due 09/25/31) 190,694 196,326
RALI 2002-QS16 M2
(5.750% due 10/25/17) 96,949 101,973
RALI 2002-QS16 M3
(5.750% due 10/25/17) 96,949 100,160
RFMSI 1993-S45 M2
(6.500% due 12/25/23) 304,396 310,148
SUMT 2003-1(2)
(4.615% due 01/25/33) 18,476,000 365,271
WAMMS 2001-MS14 5A9
(6.500% due 12/25/31) 309,000 317,943
WAMU 2002-S3 2B3
(6.000% due 06/25/17) 355,026 365,353
--------------
4,058,585
--------------
Total Collateralized Mortgage
Obligations
(cost $8,579,104) 8,644,675
--------------
ASSET-BACKED SECURITIES - 3.13%
COMMERCIAL MORTGAGE-BACKED SECURITIES - 1.80%
Chase Commercial Mortgage Sec.
(6.600% due 12/19/07) 627,885 702,914
--------------
HOME EQUITY - 0.30%
Advanta Mortgage Loan Trust
(8.050% due 06/25/27) 112,692 115,254
--------------
MANUFACTURED HOUSING - 1.03%
Greentree 1999-5 M1
(8.050% due 04/01/31) 500,000 138,750
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
20
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
BOND PORTFOLIO SCHEDULE OF INVESTMENTS
- -----------------------------------------------------------------------------
<Table>
<Caption>
PRINCIPAL VALUE
MANUFACTURED HOUSING - 1.03% (CONTINUED)
Vanderbilt Acquisition Loan Trust
(5.700% due 09/07/23) $250,000 $ 265,036
--------------
403,786
--------------
Total Asset-Backed Securities
(cost $1,483,516) 1,221,954
--------------
CORPORATE BONDS AND NOTES - 49.57%
AEROSPACE - 1.01%
Boeing Co.
(5.125% due 02/15/13) 125,000 131,437
Raytheon Co.
(5.375% due 04/01/13) 250,000 264,455
--------------
395,892
--------------
AIR TRANSPORTATION - 1.82%
American Airlines
(9.710% due 01/02/07) 252,090 138,970
America West Airlines, AMBAC Insured
(7.100% due 04/02/21) 227,082 236,490
Continental Airlines
(7.820% due 10/15/13) 165,543 108,747
Jet Equipment(2)
(7.630% due 08/15/12) 201,406 77,455
NWA Trust No. 2 Class B
(10.230% due 06/21/14) 179,446 148,940
--------------
710,602
--------------
BANK, BANK HOLDING COMPANIES, &
OTHER BANK SERVICES - 2.74%
Bank of Hawaii
(6.875% due 03/01/09) 250,000 283,077
Capital One Bank
(4.875% due 05/15/08) 300,000 306,152
Household Finance Corp.
(5.875% due 02/01/09) 200,000 222,974
Sovereign Bank
(5.125% due 03/15/13) 250,000 258,183
--------------
1,070,386
--------------
CHEMICAL - 2.12%
Crompton Corp.
(8.500% due 03/15/05) 360,000 378,000
CYTEC Industries Inc.
(4.600% due 07/01/13) 450,000 448,888
--------------
826,888
--------------
CONSUMER CYCLICAL - 6.66%
Abitibi Consolidates
(6.950% due 04/01/08) 250,000 263,120
DaimlerChrysler AG
(7.300% due 01/15/12) 250,000 281,948
DR Horton
(10.500% due 04/01/05) 100,000 111,000
General Motors
(8.250% due 07/15/23) 300,000 298,732
GMAC
(5.850% due 1/14/09) 250,000 252,620
Hertz Corp.
(7.625% due 06/01/12) 250,000 253,923
<Caption>
PRINCIPAL VALUE
CONSUMER CYCLICAL - 6.66% (CONTINUED)
Hexcel Corp.(2)
(9.875% due 10/01/08) $ 13,000 $ 14,300
Hexcel Corp.
(9.750% due 01/15/09) 125,000 124,375
MDC Holdings
(5.500% due 05/15/13) 150,000 151,241
Owens Corning
(7.700% due 05/01/08) 125,000 70,000
Park-Ohio Industries
(9.250% due 12/01/07) 62,000 52,700
Tech Olympic USA Inc.
(9.000% due 07/01/10) 125,000 135,000
TRW Automotive Inc.(2)
(9.375% due 02/15/13) 50,000 54,250
UPM-Kymmene Corp.(2)
(5.625% due 12/01/14) 250,000 268,176
Visteon Corp.
(8.250% due 08/01/10) 250,000 271,653
--------------
2,603,038
--------------
CONSUMER NON-DURABLE - 7.28%
Allied Waste North America
(7.875% due 04/15/13) 125,000 130,781
Amerigas Partner
(8.875% due 05/20/11) 63,000 68,670
Aztar Corp.
(8.875% due 05/15/07) 64,634 64,712
Bunge LTD Finance Corp.(2)
(7.800% due 10/15/12) 300,000 351,229
Central Garden & Pet Co.
(9.125% due 02/01/13) 62,000 66,030
CSK Auto Inc.
(12.000% due 06/15/06) 125,000 138,750
Del Monte Corp(2)
(8.625% due 12/15/12) 125,000 132,500
Dial Corp.
(7.000% due 08/15/06) 250,000 282,787
Dimon Inc.
(9.625% due 10/15/11) 125,000 137,500
Dole Food Inc.(2)
(8.875% due 03/15/11) 63,000 66,780
Fresh Food, Inc.
(10.750% due 06/01/06) 188,000 165,440
Omnicare Inc.
(6.125% due 06/01/13) 65,000 66,300
Remington Arms Co. Inc.(2)
(10.500% due 02/01/11) 30,000 31,350
RH Donnelley Finance Corp.(2)
(8.875% due 12/15/10) 63,000 69,615
RH Donnelley Finance Corp.(2)
(10.875% due 12/15/12) 63,000 73,395
Sealed Air Corp.(2)
(5.625% due 07/15/13) 300,000 303,012
Service Corp.
(7.700% due 04/15/09) 125,000 127,500
Syratech Corp
(11.000% due 04/15/07) 125,000 88,750
Thomson Corp.
(6.200% due 01/05/12) 200,000 228,977
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
21
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS BOND PORTFOLIO
- --------------------------------------------------------------------------
<Table>
<Caption>
PRINCIPAL VALUE
CONSUMER NON-DURABLE - 7.28% (CONTINUED)
World Color Press Inc. Sr. Nts.
(7.750% due 02/15/09) $240,000 $ 251,175
--------------
2,845,253
--------------
ELECTRIC - 2.27%
AES Corporation(2)
(9.000% due 05/15/15) 125,000 130,625
Calpine Corp.
(8.625% due 08/15/10) 250,000 187,500
NRG Northeast Generating
(9.292% due 12/15/24) 125,000 122,500
PSEG Power
(7.750% due 04/15/11) 375,000 447,449
--------------
888,074
--------------
ENERGY - 5.76%
Colorado Gas
(10.000% due 06/15/05) 125,000 135,468
Kaneb Pipeline
(5.875% due 06/01/13) 300,000 307,799
Kern River Funding Corp.(2)
(6.676% due 07/31/16) 65,608 75,477
Louis Dreyfus Nt.
(6.875% due 12/01/07) 361,000 416,366
Northwest Pipeline Corp.
(8.125% due 03/01/10) 63,000 67,725
Pemex Master Trust
(8.500% due 02/15/08) 250,000 291,875
Progess Energy Inc.
(5.850% due 10/30/08) 250,000 276,092
Tampa Electric
(6.875% due 06/15/12) 240,000 277,772
Western Oil Sands Inc.
(8.375% due 05/01/12) 250,000 278,750
Williams Co.
(7.125% due 09/01/11) 125,000 121,875
--------------
2,249,199
--------------
ENTERTAINMENT & LEISURE - 0.53%
MGM Mirage
(8.375% due 02/01/11) 125,000 142,188
Speedway Motorsports Inc.(2)
(6.750% due 06/01/13) 62,000 64,170
--------------
206,358
--------------
HEALTH CARE - 0.68%
Apogent Technologies Inc.(2)
(6.500% due 05/15/13) 125,000 129,062
Triad Hospitals Holdings
(11.000% due 05/15/09) 125,000 137,813
--------------
266,875
--------------
INSURANCE - 2.37%
Farmers Insurance Exchange(2)
(8.500% due 08/01/04) 240,000 244,110
Nationwide Financial Services
(5.625% due 02/13/15) 375,000 407,456
USF&G Capital
(8.470% due 01/10/27) 240,000 273,798
--------------
925,364
--------------
<Caption>
PRINCIPAL VALUE
MEDIA & CABLE - 3.66%
British Sky Broadcast Co.
(6.875% due 02/23/09) $300,000 $ 339,000
Clear Channel Communications
(5.750% due 01/15/13) 375,000 405,568
Comcast Corp.
(5.85% due 01/15/10) 100,000 110,030
Continental Cablevision
(8.300% due 05/15/06) 240,000 276,177
Univision Comm Inc.
(7.850% due 07/15/11) 250,000 297,570
--------------
1,428,345
--------------
MEDIA CONGLOMERATE - 1.75%
AOL Time Warner Inc.
(6.875% due 05/01/12) 240,000 273,987
News American Holdings Nts.
(6.625% due 01/09/08) 361,000 411,437
--------------
685,424
--------------
METALS & MINING - 0.36%
Falconbridge Ltd.
(7.350% due 06/05/12) 125,000 140,845
--------------
REAL ESTATE - 4.33%
Camden Property Trust
(7.625% due 02/15/11) 250,000 300,024
Colonial Properties Sr. Nts.
(8.050% due 07/15/06) 361,000 414,370
Healthcare Properties Nts.
(6.875% due 06/08/05) 361,000 386,575
Health Care Reit
(7.500% due 08/15/07) 250,000 267,120
Shurgard Storage Centers
(5.875% due 03/15/13) 300,000 321,530
--------------
1,689,619
--------------
TECHNOLOGY - 1.12%
Electronic Data Systems(2)
(6.000% due 08/01/13) 450,000 438,705
--------------
TELECOMMUNICATIONS - 5.11%
360 Communications Sr. Nts.
(6.650% due 01/15/08) 250,000 288,061
AT&T Wireless Services
(7.875% due 03/01/11) 125,000 147,627
Citizens Communications
(7.625% due 08/15/08) 250,000 296,948
GTE North Inc.
(6.900% due 11/01/08) 320,000 377,395
Nextel Communications
(9.375% due 11/15/09 125,000 134,219
Qwest Capital Funding
(7.900% due 08/15/10) 125,000 104,375
Sprint Capital Corp.
(6.000% due 01/15/07) 250,000 268,663
Telus Corp.
(8.000% due 06/01/11) 250,000 288,750
WorldCom Inc.
(7.500% due 05/15/11) 300,000 88,500
1,994,538
--------------
Total Corporate Bonds & Notes
(cost $18,529,284) 19,365,405
--------------
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
22
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
BOND PORTFOLIO SCHEDULE OF INVESTMENTS
- -----------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
SHORT-TERM INVESTMENTS - 0.28%
NORTHERN TRUST DIVERSIFIED ASSET
PORTFOLIO - 0.28% 107,535 $ 107,535
--------------
Total Short-Term Investments
(cost $107,535) 107,535
--------------
TOTAL INVESTMENTS - 99.53%
(cost $37,727,961)(1) 38,881,433
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(3) - 28.56% 11,156,266
--------------
OTHER ASSETS AND LIABILITIES - (28.09%) (10,973,032)
--------------
TOTAL NET ASSETS - 100.00% $ 39,064,667
==============
</Table>
- -------------
(1) For federal income tax purposes, cost is $37,750,033 and gross
unrealized appreciation and depreciation of securities as of
June 30, 2003 was $2,243,606 and ($1,112,206), respectively.
(2) Security exempt from registration under Rule 144(a) of the
Securities Act of 1933. These securities may be resold in
transactions exempt from registration, normally to qualified
institutional buyers.
(3) This security was purchased with cash collateral held from
securities lending.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
23
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS S&P 500 INDEX PORTFOLIO
- ---------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
SHARES VALUE
COMMON STOCKS - 94.84%
CONSUMER DISCRETIONARY - 10.51%
American Greetings* 478 $ 9,388
AOL Time Warner Inc.* 32,437 521,911
AutoNation, Inc.* 2,150 33,798
AutoZone Inc.* 715 54,319
Bed Bath & Beyond Inc.* 2,078 80,647
Best Buy Co., Inc.* 2,332 102,421
Big Lots, Inc.* 843 12,679
Black & Decker Corp. 585 25,418
Brunswick Corp. 654 16,363
Carnival Corp. 4,502 146,360
Centex Corp. 447 34,772
Circuit City Group 1,527 13,438
Clear Channel Communications* 4,443 188,339
Comcast Corp.* 16,339 493,111
Cooper Tire & Rubber 534 9,393
Dana Corp. 1,079 12,473
Darden Restaurants 1,239 23,516
Delphi Corporation 4,049 34,943
Dillard Inc. 614 8,271
Dollar General 2,419 44,171
Dow Jones & Co. 598 25,732
Eastman Kodak 2,117 57,900
eBay Inc.* 2,314 241,073
Family Dollar Stores 1,231 46,963
Federated Department Stores 1,423 52,438
Ford Motor 13,324 146,431
Fortune Brands, Inc. 1,083 56,533
Gannett Co. 1,940 149,011
Gap (The) 6,409 120,233
General Motors 4,062 146,232
Genuine Parts 1,267 40,557
Goodyear Tire & Rubber 1,271 6,673
Harley-Davidson 2,198 87,612
Harrah's Entertainment* 811 32,635
Hasbro Inc. 1,256 21,967
Hilton Hotels 2,736 34,993
Home Depot 16,862 558,469
International Game Technology* 629 64,366
Interpublic Group 2,800 37,464
Johnson Controls 644 55,126
Jones Apparel Group* 935 27,358
KB Home 348 21,569
Knight-Ridder Inc. 598 41,220
Kohl's Corp.* 2,445 125,624
Leggett & Platt 1,412 28,946
Limited Brands, Inc. 3,794 58,807
Liz Claiborne, Inc. 775 27,319
Lowe's Cos. 5,661 243,140
Marriott International 1,725 66,275
Mattel, Inc. 3,172 60,014
May Department Stores 2,091 46,546
Maytag Corp. 566 13,822
McDonald's Corp. 9,210 203,173
McGraw-Hill 1,405 87,110
Meredith Corp. 360 15,840
New York Times 1,099 50,005
<Caption>
SHARES VALUE
CONSUMER DISCRETIONARY - 10.51%
(CONTINUED)
Newell Rubbermaid Co. 1,939 $ 54,292
NIKE Inc. 1,912 102,273
Nordstrom 984 19,208
Office Depot* 2,242 32,531
Omnicom Group 1,364 97,799
Penney (J.C.) 1,945 32,773
Pulte Homes, Inc. 444 27,377
RadioShack Corp 1,222 32,151
Reebok International* 430 14,461
Sears, Roebuck & Co. 2,294 77,170
Sherwin-Williams 1,087 29,219
Snap-On Inc. 424 12,309
Stanley Works 641 17,692
Staples, Inc.* 3,414 62,647
Starbucks Corporation* 2,816 69,048
Starwood Hotels & Resorts 1,447 41,370
Target Corp. 6,596 249,593
Tiffany & Co. 1,055 34,477
TJX Companies Inc. 3,830 72,157
Toys R Us, Inc.* 1,541 18,677
Tribune Co. 2,211 106,791
Tupperware Corp. 424 6,089
Univision Communications* 1,663 50,555
V.F. Corp. 788 26,768
Viacom Inc.* 12,772 557,621
Visteon Corp. 944 6,485
Walt Disney Co. 14,806 292,419
Wendy's International 837 24,248
Whirlpool Corp. 495 31,532
Yum! Brands, Inc* 2,143 63,347
--------------
7,227,986
--------------
CONSUMER STAPLES - 11.10%
Alberto-Culver 422 21,564
Albertson's 2,749 52,781
Altria Group, Inc. 14,698 667,877
Anheuser-Busch 6,054 309,057
Archer-Daniels-Midland 4,689 60,347
Avon Products 1,707 106,175
Brown-Forman Corp. 438 34,436
Campbell Soup 2,975 72,888
Clorox Co. 1,596 68,069
Coca Cola Co. 17,973 834,127
Coca-Cola Enterprises 3,260 59,169
Colgate-Palmolive 3,903 226,179
ConAgra Foods, Inc. 3,894 91,898
Coors (Adolph) 264 12,931
Costco Wholesale Corporation* 3,303 120,890
CVS Corp. 2,849 79,857
General Mills 2,659 126,063
Gillette Co. 7,649 243,697
Heinz (H.J.) 2,547 84,000
Hershey Foods 988 68,824
Kellogg Co. 2,964 101,873
Kimberly-Clark 3,729 194,430
Kroger Co.* 5,606 93,508
McCormick & Co. 1,000 27,200
Pepsi Bottling Group 2,034 40,721
PepsiCo Inc. 12,524 557,318
Procter & Gamble 9,420 840,076
RJ Reynolds Tobacco 640 23,814
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
24
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
S&P 500 INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
CONSUMER STAPLES - 11.10% (CONTINUED)
Safeway Inc.* 3,200 $ 65,472
Sara Lee Corp. 5,656 106,389
Supervalu Inc. 970 20,680
Sysco Corp. 4,768 143,231
UST Inc. 1,225 42,912
Walgreen Co. 7,431 223,673
Wal-Mart Stores 31,801 1,706,760
Winn-Dixie 1,021 12,569
Wrigley (Wm) Jr. 1,634 91,880
--------------
7,633,335
--------------
ENERGY - 5.49%
Amerada Hess 647 31,819
Anadarko Petroleum 1,803 80,179
Apache Corp. 1,151 74,884
Ashland Inc. 495 15,187
Baker Hughes 2,434 81,709
BJ Services* 1,137 42,478
Burlington Resources 1,460 78,942
ChevronTexaco Corp. 7,748 559,406
ConocoPhillips 4,911 269,123
Devon Energy Corp. 1,637 87,416
EOG Resources 838 35,062
Exxon Mobil Corp. 48,533 1,742,820
Halliburton Co. 3,164 72,772
Kerr-McGee 728 32,614
Marathon Oil Corp. 2,265 59,683
Nabors Industries Ltd.* 1,050 41,528
Noble Corporation* 971 33,305
Occidental Petroleum 2,733 91,692
Rowan Cos.* 679 15,210
Schlumberger Ltd. 4,211 200,317
Sunoco., Inc. 554 20,908
Transocean Inc.* 2,316 50,883
Unocal Corp. 1,871 53,679
--------------
3,771,616
--------------
FINANCIAL - 19.43%
ACE Limited 1,905 65,322
AFLAC Corporation 3,743 115,097
Allstate Corp. 5,097 181,708
Ambac Financial Group 769 50,946
American Express 9,532 398,533
American International Group 18,912 1,043,564
AmSouth Bancorporation 2,577 56,282
Aon Corp. 2,247 54,108
Apartment Investment & Management 650 22,490
Bank of America Corp. 10,851 857,555
Bank of New York 5,556 159,735
Bank One Corp. 8,446 314,022
BB&T Corporation 3,473 119,124
Bear Stearns Cos. 698 50,549
Capital One Financial 1,610 79,180
Charles Schwab 9,742 98,297
Charter One Financial 1,639 51,104
Chubb Corp. 1,241 74,460
Cincinnati Financial 1,172 43,469
Citigroup Inc. 37,249 1,594,257
Comerica Inc. 1,267 58,916
Countrywide Financial Corp. 917 63,796
Equity Office Properties 2,986 80,652
<Caption>
SHARES VALUE
FINANCIAL - 19.43% (CONTINUED)
Equity Residential 1,965 $ 50,992
Fannie Mae 7,126 480,577
Federal Home Loan Mortgage 5,043 256,033
Federated Investors Inc. 800 21,936
Fifth Third Bancorp 4,189 240,197
First Tennessee National 911 40,002
Fleet Boston Financial Group 7,613 226,182
Franklin Resources 1,885 73,647
Golden West Financial 1,113 89,051
Goldman Sachs Group 3,462 289,943
Hartford Financial Services Group 2,026 102,029
Huntington Bancshares 1,710 33,379
J.P. Morgan Chase & Co. 14,775 505,010
Janus Capital Group 1,615 26,486
Jefferson-Pilot 1,041 43,160
John Hancock Financial 2,089 64,195
KeyCorp 3,081 77,857
Lehman Bros. 1,723 114,545
Lincoln National 1,284 45,749
Loews Corp. 1,345 63,605
Marsh & McLennan 3,895 198,918
Marshall & Ilsley Corp. 1,583 48,408
MBIA Inc. 1,053 51,334
MBNA Corp. 9,263 193,041
Mellon Bank Corp. 3,128 86,802
Merrill Lynch 6,718 313,596
MetLife Inc. 5,477 155,109
MGIC Investment 729 34,001
Moody's Corp 1,097 57,823
Morgan Stanley 7,875 336,656
National City Corp. 4,438 145,167
North Fork Bancorporation 1,172 39,918
Northern Trust Corp. 1,602 66,948
Plum Creek Timber Co. 1,341 34,799
PNC Bank Corp. 2,059 100,500
Principal Financial Group 2,442 78,755
Progressive Corp. 1,579 115,425
Providian Financial Corp.* 2,096 19,409
Prudential Financial 4,108 138,234
Regions Financial Corp. 1,605 54,217
SAFECO Corp. 1,002 35,351
Simon Property Group, Inc 1,362 53,159
SLM Corporation 3,342 130,906
SouthTrust Corp. 2,516 68,435
St. Paul Cos. 1,642 59,949
State Street Corp. 2,353 92,708
SunTrust Banks 2,057 122,062
Synovus Financial 2,177 46,806
T. Rowe Price Group 888 33,522
Torchmark Corp. 859 31,998
Travelers Property Casualty Corp. 7,287 114,916
U.S. Bancorp 13,881 340,085
Union Planters Corporation 1,437 44,590
UnumProvident Corp. 2,051 27,504
Wachovia Corp. 9,865 394,205
Washington Mutual 6,864 283,483
Wells Fargo 12,277 618,758
XL Capital 986 81,838
Zions Bancorp 660 33,403
--------------
13,360,479
--------------
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
25
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS S&P 500 INDEX PORTFOLIO
- --------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
HEALTH CARE - 14.07%
Abbott Labs 11,329 $ 495,757
Aetna Inc. 1,092 65,738
Allergan, Inc. 939 72,397
AmerisourceBergen Corp. 768 53,261
Amgen Inc.* 9,131 606,664
Anthem, Inc.* 1,026 79,156
Applera Corp-Applied Biosystems Group 1,517 28,869
Bard (C.R.) Inc. 375 26,741
Bausch & Lomb 392 14,700
Baxter International Inc. 4,303 111,878
Becton, Dickinson 1,862 72,339
Biogen, Inc.* 1,081 41,078
Biomet, Inc. 1,884 53,995
Boston Scientific* 2,959 180,795
Bristol-Myers Squibb 14,037 381,105
Cardinal Health, Inc. 3,210 206,403
Chiron Corporation* 1,364 59,634
CIGNA Corp. 1,011 47,456
Forest Laboratories* 2,624 143,664
Genzyme General* 1,556 65,041
Guidant Corp. 2,217 98,413
HCA Inc. 3,722 119,253
Health Management Assoc. 1,729 31,900
Humana Inc.* 1,178 17,788
IMS Health Inc. 1,772 31,878
Johnson & Johnson 21,540 1,113,618
King Pharmaceuticals* 1,747 25,786
Lilly (Eli) & Co. 8,145 561,761
Manor Care Inc.* 699 17,482
McKesson Corp. 2,112 75,483
MedImmune, Inc.* 1,821 66,230
Medtronic Inc. 8,848 424,439
Merck & Co. 16,283 985,936
Millipore Corp.* 351 15,574
Pfizer, Inc. 57,351 1,958,533
Quest Diagnostics* 758 48,360
Quintiles Transnational* 854 12,118
Schering-Plough 10,633 197,774
St Jude Medical* 1,288 74,060
Stryker Corp. 1,437 99,685
Tenet Healthcare Corp.* 3,536 41,194
United Health Group Inc. 4,416 221,904
Watson Pharmaceuticals* 776 31,327
WellPoint Health Networks* 1,079 90,960
Wyeth 9,614 437,918
Zimmer Holdings* 1,414 63,701
--------------
9,669,746
--------------
INDUSTRIALS - 9.91%
3M Company 2,830 365,013
Allied Waste Industries* 1,430 14,372
American Power Conversion Corporation* 1,422 22,169
American Standard* 526 38,887
Apollo Group, Inc.* 1,266 78,188
Avery Dennison Corp. 797 40,009
Block H&R 1,311 56,701
Boeing Company 6,089 208,974
Burlington Northern Santa Fe 2,737 77,840
Caterpillar Inc. 2,496 138,927
Cendant Corporation* 7,521 137,785
Cintas Corporation 1,233 43,698
<Caption>
SHARES VALUE
INDUSTRIALS - 9.91% (CONTINUED)
Cooper Industries, Ltd. 669 $ 27,630
Crane Company 432 9,776
CSX Corp. 1,545 46,489
Cummins Inc. 301 10,803
Danaher Corp. 1,106 75,263
Deere & Co. 1,730 79,061
Delta Air Lines 896 13,153
Deluxe Corp. 448 20,070
Donnelley (R.R.) & Sons 823 21,513
Dover Corp. 1,468 43,981
Eaton Corp. 512 40,248
Emerson Electric 3,054 156,059
Equifax Inc. 1,032 26,832
FedEx Corporation 2,163 134,171
Fluor Corp. 583 19,612
General Dynamics 1,459 105,778
General Electric 72,563 2,081,107
Goodrich Corporation 835 17,535
Grainger (W.W.) Inc. 663 31,002
Honeywell International Inc. 6,206 166,631
Illinois Tool Works 2,223 146,385
Ingersoll-Rand Co. Ltd. 1,228 58,109
ITT Industries, Inc. 667 43,662
Lockheed Martin Corp. 3,308 157,362
Masco Corp. 3,567 85,073
McDermott International* 464 2,937
Monster Worldwide Inc.* 807 15,922
Navistar International Corp.* 462 15,075
Norfolk Southern Corp. 2,821 54,163
Northrop Grumman Corp. 1,320 113,903
PACCAR Inc. 841 56,818
Pall Corp. 891 20,048
Parker-Hannifin 857 35,985
Pitney-Bowes 1,716 65,912
Power-One Inc.* 570 4,076
Raytheon Co. 2,943 96,648
Robert Half International* 1,258 23,827
Rockwell Automation, Inc. 1,348 32,136
Rockwell Collins 1,325 32,635
Ryder System 453 11,606
Southwest Airlines 5,616 96,595
Textron Inc. 997 38,903
Thomas & Betts Corp.* 423 6,112
Tyco International 14,465 274,546
Union Pacific 1,837 106,583
United Parcel Service 8,097 515,779
United Technologies 3,434 243,230
Waste Management Inc. 4,413 106,309
--------------
6,809,616
--------------
INFORMATION TECHNOLOGY - 15.31%
ADC Telecommunications, Inc.* 5,775 13,444
Adobe Systems Incorporated 1,715 55,000
Advanced Micro Devices* 2,500 16,025
Agilent Technologies* 3,384 66,157
Altera Corporation* 2,776 45,526
Analog Devices* 2,653 92,377
Andrew Corp.* 712 6,550
Apple Computer, Inc.* 2,602 49,750
Applied Materials, Inc.* 11,928 189,178
Applied Micro Circuits* 2,191 13,256
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
26
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
S&P 500 INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
INFORMATION TECHNOLOGY - 15.31%
(CONTINUED)
Autodesk, Inc. 818 $ 13,219
Automatic Data Processing Inc. 4,344 147,088
Avaya Inc.* 2,637 17,035
BMC Software* 1,707 27,875
Broadcom Corporation* 2,000 49,820
CIENA Corporation* 3,130 16,245
Cisco Systems, Inc.* 51,021 851,540
Citrix Systems, Inc.* 1,241 25,267
Computer Associates International 4,160 92,685
Computer Sciences Corp.* 1,329 50,661
Compuware Corporation* 2,748 15,856
Comverse Technology, Inc.* 1,366 20,531
Concord EFS Inc.* 3,680 54,170
Convergys Corp.* 1,258 20,128
Corning Inc.* 8,309 61,404
Dell Computer Corporation* 18,783 600,305
Electronic Arts Inc.* 1,025 75,840
Electronic Data Systems 3,457 74,153
EMC Corp.* 15,948 166,976
First Data 5,455 226,055
Fiserv, Inc.* 1,388 49,427
Gateway Inc.* 2,350 8,578
Hewlett-Packard 22,123 471,220
Intel Corporation 47,433 985,847
International Business Machines 12,553 1,035,623
Intuit Inc.* 1,489 66,305
Jabil Circuit* 1,436 31,736
JDS Uniphase Corporation* 10,256 35,999
KLA-Tencor Corporation* 1,369 63,645
Lexmark International Inc* 914 64,684
Linear Technology Corporation 2,263 72,891
LSI Logic* 2,696 19,088
Lucent Technologies* 26,921 54,650
Maxim Integrated Products, Inc. 2,325 79,492
Mercury Interactive Corporation* 613 23,668
Micron Technology* 4,393 51,091
Microsoft Corporation 78,019 1,998,067
Molex Incorporated 1,394 37,624
Motorola Inc. 16,703 157,509
National Semiconductor* 1,312 25,873
NCR Corp.* 708 18,139
Network Appliance, Inc.* 2,444 39,617
Novell Inc.* 2,618 8,063
Novellus Systems, Inc.* 1,079 39,514
NVIDIA Corporation* 1,110 25,541
Oracle Corporation* 38,233 459,561
Parametric Technology Corp.* 1,807 5,511
Paychex, Inc. 2,718 79,665
PeopleSoft, Inc.* 2,270 39,929
PerkinElmer 919 12,691
PMC-Sierra Inc.* 1,214 14,240
QLogic Corporation* 678 32,768
QUALCOMM Incorporated 5,695 203,596
Sabre Holding Corp. 1,036 25,537
Sanmina-SCI Corporation* 3,830 24,167
Scientific-Atlanta 1,120 26,701
Siebel Systems, Inc.* 3,513 33,514
Solectron* 5,989 22,399
Sun Microsystems, Inc.* 22,652 104,199
SunGard Data Systems* 2,054 53,219
Symantec Corporation* 1,050 46,053
<Caption>
SHARES VALUE
INFORMATION TECHNOLOGY - 15.31%
(CONTINUED)
Symbol Technologies 1,677 $ 21,818
Tektronix Inc.* 588 12,701
Tellabs, Inc.* 2,987 19,625
Teradyne Inc.* 1,329 23,005
Texas Instruments 12,558 221,018
Thermo Electron* 1,186 24,930
Unisys Corp.* 2,355 28,919
VERITAS Software Corporation* 2,984 85,551
Waters Corporation* 937 27,295
Xerox Corp.* 5,344 56,593
Xilinx, Inc.* 2,447 61,934
Yahoo! Inc.* 4,284 140,344
--------------
10,525,490
--------------
MATERIALS - 2.52%
Air Products & Chemicals 1,648 68,557
Alcoa Inc 6,121 156,086
Allegheny Technologies Inc 587 3,874
Ball Corp. 413 18,796
Bemis Company 385 18,018
Boise Cascade 423 10,110
Dow Chemical 6,611 204,672
Du Pont (E.I.) 7,203 299,933
Eastman Chemical 561 17,767
Ecolab Inc. 1,880 48,128
Engelhard Corp. 928 22,987
Freeport-McMoRan Copper & Gold 1,051 25,750
Georgia-Pacific Group 1,813 34,356
Great Lakes Chemical Corp. 364 7,426
Hercules, Inc.* 793 7,851
International Flavors & Fragrances 685 21,872
International Paper 3,478 124,269
Louisiana-Pacific Corp.* 759 8,228
MeadWestvaco Corporation 1,451 35,840
Monsanto Co. 1,899 41,094
Newmont Mining Corp. 2,915 94,621
Nucor Corp. 568 27,747
Pactiv Corp.* 1,150 22,667
Phelps Dodge* 645 24,729
PPG Industries 1,229 62,359
Praxair, Inc. 1,173 70,497
Rohm & Haas 1,603 49,741
Sealed Air Corp.* 609 29,025
Sigma-Aldrich Corporation 520 28,174
Temple-Inland 390 16,735
United States Steel Corp. 742 12,147
Vulcan Materials 736 27,284
Weyerhaeuser Corp. 1,589 85,806
Worthington Industries Inc. 622 8,335
--------------
1,735,481
--------------
TELECOMMUNICATION SERVICES - 3.67%
ALLTEL Corp. 2,255 108,736
AT&T Corp. 5,586 107,531
AT&T Wireless Services* 19,678 161,556
BellSouth 13,481 358,999
Century Telephone 1,034 36,035
Citizens Communications* 2,051 26,437
Nextel Communications, Inc.* 7,483 135,293
Qwest Communications Int* 11,753 56,179
SBC Communications Inc. 24,059 614,707
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
27
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS S&P 500 INDEX PORTFOLIO
- --------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
TELECOMMUNICATION SERVICES - 3.67%
(CONTINUED)
Sprint Corp. FON 6,486 $ 93,398
Sprint Corp. PCS* 7,244 41,653
Verizon Communications 19,852 783,163
--------------
2,523,687
--------------
UTILITIES - 2.83%
AES Corp.* 3,943 25,038
Allegheny Energy 912 7,706
Ameren Corporation 1,114 49,127
American Electric Power 2,819 84,091
Calpine Corp.* 2,741 18,091
CenterPoint Energy 2,205 17,971
CINergy Corp. 1,220 44,884
CMS Energy 1,045 8,465
Consolidated Edison 1,549 67,041
Constellation Energy Group 1,196 41,023
Dominion Resources 2,228 143,194
DTE Energy Co. 1,215 46,948
Duke Energy 6,464 128,957
Dynegy Inc.* 2,693 11,311
Edison International* 2,364 38,841
El Paso Corp. 4,343 35,091
Entergy Corp. 1,611 85,029
Exelon Corp. 2,343 140,135
FirstEnergy Corp. 2,158 82,975
FPL Group 1,324 88,509
Keyspan Energy 1,114 39,491
Kinder Morgan 883 48,256
Mirant Corporation* 2,922 8,474
NICOR Inc. 320 11,875
NiSource Inc. 1,768 33,592
Peoples Energy 258 11,066
PG&E Corp.* 2,934 62,054
Pinnacle West Capital 656 24,567
PPL Corp. 1,193 51,299
Progress Energy, Inc. 1,718 75,420
<Caption>
SHARES VALUE
UTILITIES - 2.83% (CONTINUED)
Public Services Enterprise Inc. 1,613 $ 68,149
Sempra Energy 1,486 42,396
Southern Co. 5,173 161,188
TECO Energy 1,275 15,287
TXU Corp. 2,336 52,443
Williams Cos. 3,755 29,665
Xcel Energy Inc 2,891 43,481
--------------
1,943,130
--------------
Total Common Stocks
(cost $49,222,431) 65,200,566
--------------
UNIT INVESTMENT TRUST - 0.83%
S&P 500 Depositary Receipts* 5,825 568,695
--------------
Total Unit Investment Trust
(cost $505,045) 568,695
--------------
SHORT-TERM INVESTMENTS(3) - 4.51%
NORTHERN TRUST DIVERSIFIED ASSETS
PORTFOLIO - 3.35% 2,303,207 2,303,207
--------------
<Caption>
PRINCIPAL VALUE
U.S. TREASURY BILL - 1.16%
U.S. Treasury Bill (1.140% due
09/18/03) $ 800,000 $ 798,490
--------------
Total Short-Term Investments
(cost $3,101,697) 3,101,697
--------------
TOTAL INVESTMENTS - 100.18%
(cost $52,829,173)(1) 68,870,958
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(2) - 7.51% 5,160,918
--------------
OTHER ASSETS AND LIABILITIES - (7.69%) (5,284,727)
--------------
TOTAL NET ASSETS - 100.00% $ 68,747,149
==============
</Table>
- -------------
* Non-income producing
(1) For federal income tax purposes, cost is $53,156,731 and gross
unrealized appreciation and depreciation of securities as of
June 30, 2003 was $22,828,303 and ($7,114,076), respectively.
(2) This security was purchased with cash collateral held from
securities lending.
(3) Securities and other assets with an aggregate value of
$2,919,900 have been segregated with the custodian or
designated to cover margin requirements for the open
futures contracts as of June 30, 2003:
<Table>
<Caption>
UNREALIZED
APPRECIATION/
TYPE CONTRACTS (DEPRECIATION)
- -------------------------------------------------------------------
S&P 500 Index (09/03) 12 $(115,750)
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
28
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
S&P MIDCAP 400 INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
SHARES VALUE
COMMON STOCKS - 86.08%
CONSUMER DISCRETIONARY - 14.05%
99(Cents) Only Stores* 2,064 $ 70,836
Abercrombie & Fitch Co.* 2,931 83,270
American Eagle Outfitters* 2,137 39,193
Applebee's International 1,650 51,860
Arvinmeritor Inc 2,007 40,501
Bandag Inc. 612 22,809
Barnes & Noble* 1,993 45,939
Belo Corp. 3,306 73,922
BLYTH Inc. 1,371 37,291
Bob Evans Farms Inc. 1,036 28,625
Borders Group* 2,418 42,581
Borg Warner Inc. 786 50,618
Brinker International* 2,900 104,458
Callaway Golf Co. 2,321 30,684
CarMax Inc.* 3,000 90,450
Catalina Marketing* 1,639 28,928
CBRL Group 1,561 60,660
Cheesecake Factory* 1,493 53,584
Chico's FAS* 2,550 53,678
Claire's Stores Inc. 1,439 36,493
Clayton Homes 4,061 50,966
Coach, Inc.* 2,635 131,065
D.R. Horton 4,334 121,785
Dollar Tree Stores, Inc.* 3,365 106,771
Emmis Communications* 1,579 36,238
Entercom Communications* 1,465 71,800
Extended Stay America* 2,763 37,273
Furniture Brands International* 1,667 43,509
Gentex Corporation* 2,234 68,383
GTECH Holdings Corp.* 1,699 63,967
Harte-Hanks, Inc. 2,789 52,991
Hispanic Broadcasting* 3,214 81,796
International Speedway 1,572 62,110
Krispy Kreme Doughnuts* 1,600 65,888
Lear Corporation* 1,930 88,819
Lee Enterprises 1,310 49,164
Lennar Corp 2,106 150,579
Mandalay Resort Group 1,771 56,406
Media General 687 39,296
Michaels Stores* 1,956 74,445
Modine Manufacturing Co. 992 19,215
Mohawk Industries* 1,997 110,893
Neiman-Marcus Group 1,419 51,935
Outback Steakhouse 2,284 89,076
Park Place Entertainment* 8,941 81,274
Payless Shoesource Inc.* 1,998 24,975
PETsMART, Inc.* 4,000 66,680
Pier 1 Imports 2,925 59,670
Reader's Digest Association 2,950 39,766
Ross Stores, Inc. 2,339 99,969
Ruby Tuesday, Inc. 1,900 46,987
SAKS Inc.* 4,216 40,895
Scholastic Corp.* 1,151 34,277
Six Flags Inc.* 2,736 18,550
Superior Industries International Inc. 771 32,151
Timberland Co* 1,119 59,150
Toll Brothers* 2,025 57,328
<Caption>
SHARES VALUE
CONSUMER DISCRETIONARY - 14.05%
(CONTINUED)
Unifi Inc.* 1,596 $ 9,895
Washington Post 281 205,946
Westwood One, Inc.* 3,169 107,524
Williams-Sonoma Inc.* 3,411 99,601
--------------
3,855,388
--------------
CONSUMER STAPLES - 4.03%
BJ's Wholesale Club* 2,113 31,822
Church & Dwight 1,167 38,196
Constellation Brands* 2,634 82,708
Dean Foods* 3,999 125,967
Dial Corporation 2,804 54,538
Energizer Holdings Inc.* 2,613 82,048
Hormel Foods Corp. 4,109 97,383
Interstate Bakeries 1,290 16,383
J.M. Smucker Co. 1,454 58,000
Lancaster Colony 1,083 41,869
Longs Drug Stores Corp. 1,131 18,775
PepsiAmericas, Inc. 4,582 57,550
Ruddick Corp. 1,375 21,615
Sensient Technologies Corp. 1,412 32,462
Smithfield Foods* 3,279 75,155
Tootsie Roll 1,574 47,991
Tyson Foods 10,458 111,064
Universal Corp. 776 32,825
Whole Foods Market, Inc.* 1,673 79,518
--------------
1,105,869
--------------
ENERGY - 5.90%
Cooper Cameron Corp* 1,600 80,608
ENSCO International 4,451 119,732
FMC Technologies* 1,935 40,732
Forest Oil* 1,387 34,841
Grant Prideco* 3,297 38,740
Hanover Compressor* 1,944 21,967
Helmerich & Payne 1,477 43,128
Murphy Oil 2,706 142,336
National-Oilwell Inc.* 2,493 54,846
Noble Energy, Inc 1,685 63,693
Overseas Shipholding Group Inc. 1,017 22,384
Patterson-UTI Energy, Inc.* 2,337 75,719
Pioneer Natural Resources* 3,430 89,523
Pogo Producing 1,800 76,950
Pride International* 3,935 74,057
Smith International* 3,001 110,257
Tidewater Inc. 1,791 52,602
Valero Energy 3,132 113,786
Varco International* 2,855 55,958
Weatherford International Ltd.* 3,852 161,397
Western Gas Resources Inc. 975 38,610
XTO Energy Inc. 5,333 107,247
--------------
1,619,113
--------------
FINANCIALS - 17.23%
A.G. Edwards 2,392 81,806
Allmerica Financial* 1,568 28,208
AMB Property Corp 2,450 69,017
American Financial Group 2,034 46,375
AmeriCredit Corp.* 4,400 37,620
AmerUs Group Co. 1,196 33,715
Associated Banc-Corp. 2,263 83,459
Astoria Financial 2,660 74,294
Bank of Hawaii Corp. 1,820 60,333
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
29
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS S&P MIDCAP 400 INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
FINANCIALS - 17.23% (CONTINUED)
Banknorth Group Inc 4,845 $ 123,644
Brown & Brown Inc. 1,900 61,750
City National Corp. 1,478 65,860
Colonial BancGroup 3,698 51,291
Commerce Bancorp. 1,966 72,939
Compass Bancshares 3,773 131,791
Dime Bancorp Inc 1,500 225
E*Trade Group* 10,776 91,596
Eaton Vance 2,062 65,159
Everest Re Group 1,642 125,613
Fidelity National Financial 3,816 117,380
First Amer'n Corp. 2,200 57,970
First Virginia Banks Inc 2,124 91,587
FirstMerit Corp. 2,516 57,516
Gallagher(Arthur J.) 2,545 69,224
GATX Corp. 1,446 23,642
Greater Bay Bancorp 1,494 30,507
Greenpoint Financial Corp. 2,835 144,415
HCC Insurance Holdings 1,839 54,379
Hibernia Corp. 4,733 85,951
Horace Mann Educators Corp. 1,208 19,485
Hospitality Properties Trust 1,853 57,906
Independence Community Bank 1,711 48,284
IndyMac Bancorp 1,694 43,061
Investment Technology Group* 1,457 27,100
Investors Financial Services 1,907 55,322
LaBranche & Co. 1,748 36,166
Legg Mason 1,901 123,470
Leucadia National Corp. 1,740 64,589
Liberty Property Trust 2,250 77,850
M&T Bank Corp. 3,493 294,180
Mack-Cali Realty 1,650 60,027
Mercantile Bankshares 2,068 81,438
National Commerce Financial 6,118 135,758
Neuberger Berman Inc. 2,082 83,093
New Plan Excel Realty Trust 2,808 59,951
New York Community Bancorp 4,229 123,022
Ohio Casualty Corp.* 1,784 23,513
Old Republic International 3,562 122,070
PMI Group 2,669 71,636
Protective Life Corp. 2,031 54,329
Provident Financial Group Inc. 1,457 37,343
Radian Group 2,800 102,620
Roslyn Bancorp 2,327 50,007
SEI Investments 3,253 104,096
Silicon Valley Bancshares* 1,162 27,667
Sovereign Bancorp 7,706 120,603
StanCorp Financial Group 878 45,849
TCF Financial 2,238 89,162
The MONY Group 1,436 38,700
United Dominion Realty Trust 3,200 55,104
Unitrin, Inc. 2,000 54,240
W. R. Berkley Corp. 1,660 87,482
Waddell & Reed Financial Investment 2,381 61,120
Webster Financial Corp. 1,446 54,659
Westamerica Bancorp 991 42,692
Wilmington Trust Corp. 1,941 56,968
--------------
4,727,828
--------------
HEALTH CARE - 12.08%
AdvancePCS* 2,732 104,444
Apogent Technologies* 3,162 63,240
<Caption>
SHARES VALUE
HEALTH CARE - 12.08% (CONTINUED)
Apria Healthcare Group Inc.* 1,613 $ 40,131
Barr Laboratories* 1,930 126,415
Beckman Coulter Inc. 1,826 74,209
Charles River Labs* 1,250 40,225
Community Health Systems* 2,850 54,977
Covance Inc.* 1,844 33,376
Coventry Health Care Inc.* 1,800 83,088
Cytyc Corp.* 3,623 38,114
DENTSPLY International Inc. 2,314 94,643
Edwards Lifesciences Corp.* 1,769 56,856
Express Scripts, Inc.* 2,367 161,713
First Health Group Corp.* 2,795 77,142
Gilead Sciences, Inc.* 5,775 320,975
Health Net, Inc.* 3,457 113,908
Henry Schein, Inc.* 1,269 66,419
Hillenbrand Industries 1,858 93,736
ICN Pharmaceuticals, Inc. 2,463 41,280
IDEC Pharmaceuticals Corporation* 4,513 153,442
IVAX Corp.* 5,759 102,798
LifePoint Hospitals* 1,167 24,437
Lincare Holdings Inc.* 3,180 100,202
Millennium Pharmaceuticals, Inc.* 8,360 131,503
Mylan Laboratories 5,596 194,573
Omnicare, Inc. 2,787 94,173
Oxford Health Plans* 2,602 109,362
PacifiCare Health Systems* 1,030 50,810
Patterson Dental Company* 2,004 90,942
Perrigo Co. 2,152 33,657
Pharmaceutical Resources Inc.* 940 45,740
Protein Design Labs Inc.* 2,627 36,725
Sepracor Inc.* 2,482 44,750
SICOR Inc.* 3,473 70,641
STERIS Corp.* 2,053 47,404
Triad Hospitals* 2,156 53,512
Universal Health Services* 1,773 70,246
Varian Medical Systems* 2,012 115,830
Vertex Pharmaceuticals* 2,241 32,719
VISX Inc.* 1,602 27,795
--------------
3,316,152
--------------
INDUSTRIALS - 9.75%
AGCO Corp.* 2,210 37,747
Airborne Inc. 1,431 29,908
Alaska Air Group Inc.* 786 16,860
Alexander & Baldwin Inc. 1,208 32,048
Allete, Inc. 2,511 66,667
Ametek Inc. 977 35,807
Banta Corp. 741 23,986
C.H. Robinson Worldwide, Inc. 2,500 88,900
Career Education* 1,400 95,788
Carlisle Companies 902 38,028
ChoicePoint Inc.* 2,526 87,198
CNF Inc. 1,421 36,065
Copart Inc.* 2,691 25,430
Corinthian Colleges Inc.* 1,300 63,141
DeVRY Inc.* 2,073 48,280
Donaldson Co. 1,307 58,096
Dun & Bradstreet* 2,205 90,626
Dycom Industries* 1,416 23,081
Education Management* 1,036 55,094
EGL Inc.* 1,419 21,569
Expeditors International of
Washington, Inc. 3,071 106,379
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
30
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
S&P MIDCAP 400 INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
INDUSTRIALS - 9.75% (CONTINUED)
Fastenal Company 2,243 $ 76,127
Federal Signal Corp. 1,342 23,579
Flowserve Corporation* 1,631 32,082
Granite Construction Inc. 1,221 23,394
Harsco Corp. 1,188 42,827
HON Industries 1,743 53,162
Hubbell Inc. 1,749 57,892
J.B. Hunt Transport Services Inc.* 1,076 40,619
Jacobs Engineering Group* 1,615 68,072
Kelly Services 1,070 25,092
Kennametal Inc. 1,011 34,212
Korn/Ferry International* 1,122 9,088
L-3 Communications Holdings* 2,767 120,337
Manpower Inc. 2,235 82,896
Miller (Herman) 2,248 45,432
Nordson Corporation 992 23,659
Pentair Inc. 1,456 56,871
Precision Castparts 1,535 47,739
Quanta Services Inc.* 3,280 23,288
Republic Services* 4,919 111,514
Rollins Inc. 1,338 25,221
Sequa Corp. 309 10,599
Sotheby's Holdings Inc.* 1,819 13,533
SPX Corp.* 2,452 108,036
Stericycle Inc.* 1,200 46,176
Swift Transportation* 2,555 47,574
Sylvan Learning Systems Inc.* 1,181 26,974
Tecumseh Products Co. 548 20,994
Teleflex 1,158 49,273
The Brink's Company 1,604 23,370
Trinity Industries Inc. 1,358 25,137
United Rentals* 2,265 31,461
Valassis Communication* 1,588 40,843
Viad Corp. 2,630 58,886
Werner Enterprises Inc. 1,900 40,280
York International 1,165 27,261
--------------
2,674,198
--------------
INFORMATION TECHNOLOGY - 13.07%
3Com Corp.* 10,565 49,444
Activision, Inc.* 2,953 38,153
Acxiom Corp.* 2,596 39,174
Adtran Inc.* 1,145 58,727
Advanced Fibre Communications* 2,451 39,878
Advent Software, Inc.* 1,026 17,350
Affiliated Computer* 3,903 178,484
Arrow Electronics* 2,976 45,354
Ascential Software Corp* 1,882 30,940
Atmel Corp.* 13,850 35,041
Avnet, Inc* 3,540 44,887
Avocent Corp.* 1,334 39,927
BISYS Group* 3,530 64,846
Cabot Microelectronics Corp.* 718 36,237
Cadence Design Systems* 7,831 94,442
CDW Corporation* 2,547 116,653
Ceridian Corp.* 4,386 74,430
Certegy, Inc.* 2,055 57,026
Checkfree Corp* 2,316 64,477
CommScope Inc.* 1,833 17,414
Credence Systems Corp.* 1,794 15,195
Cree Inc.* 2,154 35,067
CSG Systems International* 1,562 22,071
<Caption>
SHARES VALUE
INFORMATION TECHNOLOGY - 13.07%
(CONTINUED)
Cypress Semiconductor* 3,649 $ 43,788
Diebold, Inc. 2,130 92,123
DST Systems Inc.* 3,538 134,444
Fair, Isaac Corporation 1,450 74,603
Fairchild Semiconductor* 3,457 44,215
Gartner, Inc. 2,527 18,953
Harris Corp. 1,960 58,898
Henry (Jack) & Assoc. 2,676 47,606
Imation Corp. 1,038 39,257
InFocus Corp.* 1,166 5,504
Integrated Circuit Systems Inc. 2,000 62,860
Integrated Device Technology* 3,094 34,189
Internet Security Systems Inc.* 1,429 20,706
Intersil Corp.* 4,033 107,318
International Rectifier* 1,879 50,395
Keane Inc.* 2,258 30,777
KEMET Corp.* 2,547 25,725
Lam Research* 3,772 68,688
Lattice Semiconductor Corp.* 3,246 26,715
Legato Systems Inc.* 3,392 28,459
LTX Corp.* 1,450 12,499
Macromedia Inc.* 1,740 36,610
Macrovision Corporation* 1,513 30,139
McData Corp.* 3,355 49,218
Mentor Graphics Corp.* 1,940 28,091
Micrel Inc.* 2,756 28,635
Microchip Technology Incorporated 5,915 145,686
MPS Group Inc.* 3,062 21,067
National Instruments* 1,521 57,463
Network Associates, Inc.* 4,559 57,808
Newport Corporation* 1,121 16,591
Overture Services Inc.* 1,700 30,821
Plantronics Inc.* 1,374 29,775
Plexus Corp.* 1,239 14,286
Polycom Inc.* 2,962 41,053
Powerwave Technologies Inc.* 1,940 12,164
Quantum Corp.* 4,577 18,537
Retek Inc.* 1,546 9,894
Reynolds & Reynolds 2,073 59,205
RF Micro Devices, Inc.* 5,308 31,954
RSA Security Inc.* 1,679 18,049
SanDisk Corporation* 2,032 81,991
Semtech Corp* 2,165 30,830
Silicon Laboratories Inc.* 1,500 39,960
Storage Technology* 3,144 80,927
Sybase Inc.* 2,933 40,798
Synopsys, Inc.* 2,207 136,500
Tech Data Corp.* 1,668 44,552
Titan Corp.* 2,279 23,451
Transaction Systems Architects Inc.* 1,046 9,372
Triquint Semiconductor Inc.* 3,885 16,162
Varian Inc.* 857 29,712
Vishay Intertechnology* 4,714 62,224
Wind River Systems Inc.* 2,338 8,908
--------------
3,585,372
--------------
MATERIALS - 3.61%
Airgas Inc. 2,062 34,539
AK Steel Holding Corp.* 3,203 11,595
Albemarle Corp. 1,229 34,375
Arch Coal Inc. 1,552 35,665
Bowater Inc. 1,632 61,118
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
31
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS S&P MIDCAP 400 INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
MATERIALS - 3.61% (CONTINUED)
Cabot Corp. 1,840 $ 52,808
Carpenter Technology Corp. 659 10,280
Crompton Corporation 3,356 23,660
Cytec Industries Inc.* 1,173 39,647
Ferro Corp. 1,170 26,360
FMC Corp.* 1,033 23,377
Glatfelter 1,285 18,954
IMC Global Inc. 3,404 22,841
Longview Fibre Co. 1,512 12,398
Lubrizol Corp. 1,518 47,043
Lyondell Chemical Co. 4,650 62,915
Martin Marietta 1,442 48,466
Minerals Technologies Inc. 605 29,439
Olin Corp. 1,641 28,061
Packaging Corp. of America* 3,124 57,575
Peabody Energy 1,550 52,065
Potlatch Corp. 841 21,656
Rayonier Inc. 1,231 40,623
RPM International Inc. 3,387 46,571
Sonoco Products 2,861 68,721
Valspar Corp 1,488 62,823
Wausau-Mosinee Paper Corp. 1,525 17,080
--------------
990,655
--------------
TELECOMMUNICATION SERVICES - 0.55%
Cincinnati Bell Inc* 6,539 43,811
Price Communications* 1,624 20,966
Telephone & Data Systems 1,737 86,329
--------------
151,106
--------------
UTILITIES - 5.81%
AGL Resources Inc. 1,833 46,632
Alliant Energy 2,680 51,000
Aquila, Inc. 5,335 13,764
Black Hills Corp. 792 24,314
DPL Incorporated 3,746 59,711
DQE, Inc. 2,121 31,963
Energy East 4,270 88,645
Equitable Resources 1,874 76,347
Great Plains Energy Inc. 1,835 52,995
Hawaiian Electric Industries 1,071 49,105
IDACORP Inc. 1,113 29,216
MDU Resources 2,093 70,095
National Fuel Gas 2,368 61,686
Northeast Utilities 4,060 67,964
<Caption>
SHARES VALUE
UTILITIES - 5.81% (CONTINUED)
NSTAR 1,569 $ 71,468
OGE Energy Corp. 2,309 49,343
ONEOK Inc. 2,134 41,890
Pepco Holdings, Inc. 4,827 92,485
Phila Suburban 1,950 47,541
PNM Resources Inc. 1,158 30,977
Puget Energy, Inc. 2,756 65,786
Questar Corp. 2,419 80,964
SCANA Corp . 3,274 112,235
Sierra Pacific Resources* 3,028 17,986
Vectren Corporation 2,006 50,250
Westar Energy Inc. 2,124 34,473
WGL Holdings Inc. 1,436 38,341
Wisconsin Energy 3,425 99,325
WPS Resources Corp. 933 37,507
--------------
1,594,008
--------------
Total Common Stocks (cost
$23,794,997) 23,619,689
--------------
UNIT INVESTMENT TRUST(3) - 3.84%
S&P MidCap 400 Depositary Receipts* 12,010 1,053,517
--------------
Total Unit Investment Trust
(cost $917,445) 1,053,517
--------------
SHORT-TERM INVESTMENTS(3) - 9.42%
NORTHERN TRUST DIVERSIFIED ASSETS
PORTFOLIO - 4.33% 1,188,080 1,188,080
--------------
<Caption>
PRINCIPAL VALUE
U.S. TREASURY BILL - 5.09%
(1.140% due 09/18/03) $ 1,400,000 $ 1,397,358
--------------
Total Short-Term Investments
(cost $2,585,438) 2,585,438
--------------
TOTAL INVESTMENTS - 99.34%
(cost $27,297,880)(1) 27,258,644
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(2) - 18.81% 5,160,918
--------------
OTHER ASSETS AND LIABILITIES - (18.15%) (4,979,432)
--------------
TOTAL NET ASSETS - 100.00% $ 27,440,130
==============
</Table>
- -------------
* Non-income producing
(1) For federal income tax purposes, cost is $28,057,034 and gross
unrealized appreciation and depreciation of securities as of
June 30, 2003 was $3,356,802 and ($4,155,192), respectively.
(2) This security was purchased with cash collateral held from
securities lending.
(3) Securities and other assets with an aggregate value of
$2,689,120 have been segregated with the custodian or
designated to cover margin requirements for the open futures
contracts as of June 30, 2003:
<Table>
<Caption>
UNREALIZED
APPRECIATION/
TYPE CONTRACTS (DEPRECIATION)
- -------------------------------------------------------------------
S&P MidCap 400 Index (09/03) 10 $(52,725)
S&P MidCap 400 Index Mini (09/03) 6 $ (6,750)
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
32
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
BALANCED INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
SHARES VALUE
COMMON STOCKS - 54.68%
CONSUMER DISCRETIONARY - 6.04%
American Greetings* 43 $ 845
AOL Time Warner Inc.* 2,961 47,642
AutoNation, Inc.* 175 2,751
AutoZone Inc.* 88 6,685
Bed Bath & Beyond Inc.* 186 7,219
Best Buy Co., Inc.* 202 8,872
Big Lots, Inc.* 73 1,098
Black & Decker Corp. 56 2,433
Brunswick Corp. 58 1,451
Carnival Corp. 400 13,004
Centex Corp. 39 3,034
Circuit City Group 134 1,179
Clear Channel Communications* 380 16,108
Comcast Corp.* 1,557 46,990
Cooper Tire & Rubber 49 862
Dana Corp. 101 1,168
Darden Restaurants 123 2,335
Delphi Corporation 372 3,210
Dillard Inc. 62 835
Dollar General 218 3,981
Dow Jones & Co. 59 2,539
Eastman Kodak 205 5,607
eBay Inc.* 170 17,711
Family Dollar Stores 129 4,921
Federated Department Stores 141 5,196
Ford Motor 1,227 13,485
Fortune Brands, Inc. 105 5,481
Gannett Co. 176 13,519
Gap (The) 563 10,562
General Motors 387 13,932
Genuine Parts 117 3,745
Goodyear Tire & Rubber 103 541
Harley-Davidson 201 8,012
Harrah's Entertainment* 81 3,259
Hasbro Inc. 114 1,994
Hilton Hotels 243 3,108
Home Depot 1,585 52,495
International Game Technology* 50 5,117
Interpublic Group 199 2,663
Johnson Controls 57 4,879
Jones Apparel Group* 80 2,341
KB Home 32 1,983
Knight-Ridder Inc. 51 3,515
Kohl's Corp.* 216 11,098
Leggett & Platt 130 2,665
Limited Brands, Inc. 284 4,402
Liz Claiborne, Inc. 72 2,538
Lowe's Cos. 506 21,733
Marriott International 158 6,070
Mattel, Inc. 281 5,317
May Department Stores 204 4,541
Maytag Corp. 52 1,270
McDonald's Corp. 883 19,479
McGraw-Hill 129 7,998
Meredith Corp. 33 1,452
New York Times 112 5,096
Newell Rubbermaid Co. 176 4,928
NIKE Inc. 181 9,682
Nordstrom 89 1,737
Office Depot* 209 3,033
<Caption>
SHARES VALUE
CONSUMER DISCRETIONARY - 6.04%
(CONTINUED)
Omnicom Group 117 $ 8,389
Penney (J.C.) 173 2,915
Pulte Homes, Inc. 27 1,665
RadioShack Corp 123 3,236
Reebok International* 37 1,244
Sears, Roebuck & Co. 233 7,838
Sherwin-Williams 108 2,903
Snap-On Inc. 39 1,132
Stanley Works 58 1,601
Staples, Inc.* 320 5,872
Starbucks Corporation* 242 5,934
Starwood Hotels & Resorts 122 3,488
Target Corp. 603 22,818
Tiffany & Co. 96 3,137
TJX Companies Inc. 396 7,461
Toys R Us, Inc.* 143 1,733
Tribune Co. 204 9,853
Tupperware Corp. 38 546
Univision Communications* 142 4,317
V.F. Corp. 75 2,548
Viacom Inc* 1,194 52,126
Visteon Corp. 86 591
Walt Disney Co. 1,427 28,183
Wendy's International 75 2,173
Whirlpool Corp. 48 3,058
Yum! Brands, Inc* 194 5,735
--------------
661,842
--------------
CONSUMER STAPLES - 6.56%
Alberto-Culver 37 1,891
Albertson's 280 5,376
Altria Group, Inc. 1,376 62,525
Anheuser-Busch 598 30,528
Archer-Daniels-Midland 437 5,624
Avon Products 157 9,765
Brown-Forman Corp. 45 3,538
Campbell Soup 279 6,836
Clorox Co. 155 6,611
Coca Cola Co. 1,697 78,758
Coca-Cola Enterprises 278 5,046
Colgate-Palmolive 381 22,079
ConAgra Foods, Inc. 350 8,260
Coors (Adolph) 24 1,176
Costco Wholesale Corporation* 295 10,797
CVS Corp. 258 7,232
General Mills 293 13,891
Gillette Co. 721 22,971
Heinz (H.J.) 233 7,684
Hershey Foods 91 6,339
Kellogg Co. 268 9,211
Kimberly-Clark 367 19,135
Kroger Co.* 552 9,207
McCormick & Co. 100 2,720
Pepsi Bottling Group 188 3,764
PepsiCo Inc. 1,188 52,866
Procter & Gamble 865 77,141
RJ Reynolds Tobacco 50 1,861
Safeway Inc.* 328 6,711
Sara Lee Corp. 528 9,932
Supervalu Inc. 87 1,855
Sysco Corp. 440 13,218
UST Inc. 107 3,748
Walgreen Co. 666 20,047
Wal-Mart Stores 2,999 160,953
Winn-Dixie 96 1,182
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
33
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS BALANCED INDEX PORTFOLIO
- --------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
CONSUMER STAPLES - 6.56% (CONTINUED)
Wrigley (Wm) Jr. 150 $ 8,435
--------------
718,913
--------------
ENERGY - 3.12%
Amerada Hess 60 2,951
Anadarko Petroleum 160 7,115
Apache Corp. 92 5,986
Ashland Inc. 47 1,442
Baker Hughes 218 7,318
BJ Services* 100 3,736
Burlington Resources 142 7,678
ChevronTexaco Corp. 712 51,406
ConocoPhillips 437 23,948
Devon Energy Corp. 81 4,325
EOG Resources 75 3,138
Exxon Mobil Corp. 4,528 162,600
Halliburton Co. 293 6,739
Kerr-McGee 70 3,136
Marathon Oil Corp. 206 5,428
Nabors Industries Ltd.* 98 3,876
Noble Corporation* 90 3,087
Occidental Petroleum 244 8,186
Rowan Cos.* 62 1,389
Schlumberger Ltd. 376 17,887
Sunoco., Inc. 59 2,227
Transocean Inc.* 184 4,042
Unocal Corp. 161 4,619
--------------
342,259
--------------
FINANCIALS - 11.19%
ACE Limited 175 6,001
AFLAC Corporation 350 10,763
Allstate Corp. 492 17,540
Ambac Financial Group 70 4,638
American Express 883 36,918
American International Group 1,782 98,331
AmSouth Bancorporation 260 5,678
Aon Corp. 169 4,070
Apartment Investment & Management 75 2,595
Bank of America Corp. 996 78,714
Bank of New York 488 14,030
Bank One Corp. 792 29,447
BB&T Corporation 259 8,884
Bear Stearns Cos. 73 5,287
Capital One Financial 129 6,344
Charles Schwab 947 9,555
Charter One Financial 159 4,958
Chubb Corp. 116 6,960
Cincinnati Financial 106 3,932
Citigroup Inc. 3,463 148,216
Comerica Inc. 103 4,790
Countrywide Financial Corp. 75 5,218
Equity Office Properties 275 7,428
Equity Residential 200 5,190
Fannie Mae 666 44,915
Federal Home Loan Mortgage 460 23,354
Federated Investors Inc. 50 1,371
Fifth Third Bancorp 374 21,445
First Tennessee National 100 4,391
Fleet Boston Financial Group 714 21,213
Franklin Resources 173 6,759
Golden West Financial 105 8,401
Goldman Sachs Group 285 23,869
Hartford Financial Services Group 142 7,151
Huntington Bancshares 161 3,143
<Caption>
SHARES VALUE
FINANCIALS - 11.19% (CONTINUED)
J.P. Morgan Chase & Co. 1,332 $ 45,528
Janus Capital Group 147 2,411
Jefferson-Pilot 102 4,229
John Hancock Financial 200 6,146
KeyCorp 287 7,252
Lehman Bros. 160 10,637
Lincoln National 127 4,525
Loews Corp. 130 6,148
Marsh & McLennan 356 18,181
Marshall & Ilsley Corp. 140 4,281
MBIA Inc. 97 4,729
MBNA Corp. 874 18,214
Mellon Bank Corp. 325 9,019
Merrill Lynch 604 28,195
MetLife Inc. 523 14,811
MGIC Investment 70 3,265
Moody's Corp 107 5,640
Morgan Stanley 748 31,977
National City Corp. 401 13,117
North Fork Bancorporation 110 3,747
Northern Trust Corp. 147 6,143
Plum Creek Timber Co. 120 3,114
PNC Bank Corp. 192 9,372
Principal Financial Group 200 6,450
Progressive Corp. 144 10,526
Providian Financial Corp.* 188 1,741
Prudential Financial 350 11,778
Regions Financial Corp. 166 5,607
SAFECO Corp. 84 2,964
Simon Property Group, Inc 120 4,684
SLM Corporation 312 12,221
SouthTrust Corp. 222 6,038
St. Paul Cos. 140 5,111
State Street Corp. 212 8,353
SunTrust Banks 200 11,868
Synovus Financial 187 4,021
T. Rowe Price Group 80 3,020
Torchmark Corp. 85 3,166
Travelers Property Casualty Corp. 607 9,572
U.S. Bancorp 1,269 31,091
Union Planters Corporation 133 4,127
UnumProvident Corp. 159 2,132
Wachovia Corp. 916 36,603
Washington Mutual 588 24,284
Wells Fargo 1,170 58,963
XL Capital 85 7,055
Zions Bancorp 67 3,391
--------------
1,226,946
--------------
HEALTH CARE - 8.14%
Abbott Labs 1,058 46,298
Aetna Inc. 93 5,599
Allergan, Inc. 86 6,631
AmerisourceBergen Corp. 70 4,855
Amgen Inc.* 841 55,876
Anthem, Inc.* 90 6,944
Applera Corp-Applied Biosystems Group 138 2,626
Bard (C.R.) Inc. 33 2,353
Bausch & Lomb 35 1,313
Baxter International Inc. 384 9,984
Becton, Dickinson 167 6,488
Biogen, Inc.* 98 3,724
Biomet, Inc. 183 5,245
Boston Scientific* 270 16,497
Bristol-Myers Squibb 1,338 36,327
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
34
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
BALANCED INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
HEALTH CARE - 8.14% (CONTINUED)
Cardinal Health, Inc. 273 $ 17,554
Chiron Corporation* 116 5,072
CIGNA Corp. 108 5,070
Forest Laboratories* 220 12,045
Genzyme General* 140 5,852
Guidant Corp. 203 9,011
HCA Inc. 369 11,823
Health Management Assoc. 180 3,321
Humana Inc.* 111 1,676
IMS Health Inc. 196 3,526
Johnson & Johnson 2,023 104,589
King Pharmaceuticals* 145 2,140
Lilly (Eli) & Co. 747 51,521
Manor Care Inc.* 68 1,701
McKesson Corp. 186 6,648
MedImmune, Inc.* 138 5,019
Medtronic Inc. 822 39,431
Merck & Co. 1,503 91,007
Millipore Corp.* 30 1,331
Pfizer, Inc. 5,371 183,415
Quest Diagnostics* 60 3,828
Quintiles Transnational* 76 1,078
Schering-Plough 1,000 18,600
St Jude Medical* 110 6,325
Stryker Corp. 125 8,671
Tenet Healthcare Corp.* 310 3,612
United Health Group Inc. 428 21,507
Watson Pharmaceuticals* 64 2,584
WellPoint Health Networks* 82 6,913
Wyeth 897 40,858
Zimmer Holdings* 133 5,992
--------------
892,480
--------------
INDUSTRIALS - 5.66%
3M Company 262 33,793
Allied Waste Industries* 125 1,256
American Power Conversion Corporation* 128 1,996
American Standard* 50 3,697
Apollo Group, Inc.* 125 7,720
Avery Dennison Corp. 74 3,715
Block H&R 130 5,623
Boeing Company 600 20,592
Burlington Northern Santa Fe 270 7,679
Caterpillar Inc. 230 12,802
Cendant Corporation* 627 11,487
Cintas Corporation 116 4,111
Cooper Industries, Ltd. 62 2,561
Crane Company 40 905
CSX Corp. 144 4,333
Cummins Inc. 27 969
Danaher Corp. 94 6,397
Deere & Co. 155 7,084
Delta Air Lines 81 1,189
Deluxe Corp. 48 2,150
Donnelley (R.R.) & Sons 81 2,117
Dover Corp. 134 4,015
Eaton Corp. 48 3,773
Emerson Electric 282 14,410
Equifax Inc. 93 2,418
FedEx Corporation 192 11,910
Fluor Corp. 50 1,682
General Dynamics 133 9,643
General Electric 6,781 194,479
Goodrich Corporation 67 1,407
Grainger (W.W.) Inc. 62 2,899
<Caption>
SHARES VALUE
INDUSTRIALS - 5.66% (CONTINUED)
Honeywell International Inc. 528 $ 14,177
Illinois Tool Works 199 13,104
Ingersoll-Rand Co. Ltd. 107 5,063
ITT Industries, Inc. 58 3,797
Lockheed Martin Corp. 283 13,462
Masco Corp. 297 7,083
McDermott International* 40 253
Monster Worldwide Inc.* 64 1,263
Navistar International Corp.* 41 1,338
Norfolk Southern Corp. 253 4,858
Northrop Grumman Corp. 89 7,680
PACCAR Inc. 76 5,135
Pall Corp. 82 1,845
Parker-Hannifin 74 3,107
Pitney-Bowes 170 6,530
Power-One Inc.* 45 322
Raytheon Co. 225 7,389
Robert Half International* 111 2,102
Rockwell Automation, Inc. 124 2,956
Rockwell Collins 124 3,054
Ryder System 39 999
Southwest Airlines 492 8,462
Textron Inc. 95 3,707
Thomas & Betts Corp.* 38 549
Tyco International 1,317 24,997
Union Pacific 164 9,515
United Parcel Service 730 46,498
United Technologies 311 22,028
Waste Management Inc. 411 9,901
--------------
619,986
--------------
INFORMATION TECHNOLOGY - 8.90%
ADC Telecommunications, Inc.* 528 1,229
Adobe Systems Incorporated 158 5,067
Advanced Micro Devices* 202 1,295
Agilent Technologies* 299 5,845
Altera Corporation* 264 4,330
Analog Devices* 234 8,148
Andrew Corp.* 53 488
Apple Computer, Inc.* 215 4,111
Applied Materials, Inc.* 1,068 16,938
Applied Micro Circuits* 202 1,222
Autodesk, Inc. 78 1,260
Automatic Data Processing Inc. 415 14,052
Avaya Inc.* 179 1,156
BMC Software* 161 2,629
Broadcom Corporation* 142 3,537
CIENA Corporation* 215 1,116
Cisco Systems, Inc.* 4,925 82,198
Citrix Systems, Inc.* 122 2,484
Computer Associates International 389 8,667
Computer Sciences Corp.* 111 4,231
Compuware Corporation* 238 1,373
Comverse Technology, Inc.* 101 1,518
Concord EFS Inc.* 322 4,740
Convergys Corp.* 101 1,616
Corning Inc.* 729 5,387
Dell Computer Corporation* 1,770 56,569
Electronic Arts Inc.* 100 7,399
Electronic Data Systems 308 6,607
EMC Corp.* 1,497 15,674
First Data 546 22,626
Fiserv, Inc.* 120 4,273
Gateway Inc.* 213 777
Hewlett-Packard 2,088 44,474
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
35
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS BALANCED INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
INFORMATION TECHNOLOGY - 8.90%
(CONTINUED)
Intel Corporation 4,605 $ 95,710
International Business Machines 1,172 96,690
Intuit Inc.* 127 5,655
Jabil Circuit* 143 3,160
JDS Uniphase Corporation* 873 3,064
KLA-Tencor Corporation* 123 5,718
Lexmark International Inc* 85 6,015
Linear Technology Corporation 206 6,635
LSI Logic* 242 1,713
Lucent Technologies* 2,485 5,045
Maxim Integrated Products, Inc. 187 6,394
Mercury Interactive Corporation* 53 2,046
Micron Technology* 367 4,268
Microsoft Corporation 7,222 184,955
Molex Incorporated 130 3,509
Motorola Inc. 1,495 14,098
National Semiconductor* 117 2,307
NCR Corp.* 63 1,614
Network Appliance, Inc.* 201 3,258
Novell Inc.* 218 671
Novellus Systems, Inc.* 86 3,149
NVIDIA Corporation* 100 2,301
Oracle Corporation* 3,830 46,037
Parametric Technology Corp.* 182 555
Paychex, Inc. 245 7,181
PeopleSoft, Inc.* 182 3,201
PerkinElmer 64 884
PMC-Sierra Inc.* 102 1,196
QLogic Corporation* 50 2,417
QUALCOMM Incorporated 490 17,518
Sabre Holding Corp. 85 2,095
Sanmina-SCI Corporation* 346 2,183
Scientific-Atlanta 105 2,503
Siebel Systems, Inc.* 294 2,805
Solectron* 564 2,109
Sun Microsystems, Inc.* 2,203 10,134
SunGard Data Systems* 170 4,405
Symantec Corporation* 100 4,386
Symbol Technologies 135 1,756
Tektronix Inc.* 64 1,382
Tellabs, Inc.* 271 1,780
Teradyne Inc.* 114 1,973
Texas Instruments 1,184 20,844
Thermo Electron* 114 2,396
Unisys Corp.* 206 2,530
VERITAS Software Corporation* 258 7,397
Waters Corporation* 100 2,913
Xerox Corp.* 440 4,660
Xilinx, Inc.* 212 5,366
Yahoo! Inc.* 359 11,761
--------------
975,378
--------------
MATERIALS - 1.46%
Air Products & Chemicals 152 6,323
Alcoa Inc 571 14,561
Allegheny Technologies Inc 55 363
Ball Corp. 40 1,820
Bemis Company 35 1,638
Boise Cascade 38 908
Dow Chemical 590 18,266
Du Pont (E.I.) 693 28,857
Eastman Chemical 51 1,615
Ecolab Inc. 172 4,403
Engelhard Corp. 84 2,081
Freeport-McMoRan Copper & Gold 106 2,597
<Caption>
SHARES VALUE
MATERIALS - 1.46% (CONTINUED)
Georgia-Pacific Group 154 $ 2,918
Great Lakes Chemical Corp. 36 734
Hercules, Inc.* 71 703
International Flavors & Fragrances 68 2,171
International Paper 319 11,398
Louisiana-Pacific Corp.* 69 748
MeadWestvaco Corporation 132 3,260
Monsanto Co. 150 3,246
Newmont Mining Corp. (Hldg. Co.) 261 8,473
Nucor Corp. 56 2,736
Pactiv Corp.* 112 2,208
Phelps Dodge* 52 1,994
PPG Industries 115 5,835
Praxair, Inc. 104 6,250
Rohm & Haas 144 4,468
Sealed Air Corp.* 55 2,621
Sigma-Aldrich Corporation 56 3,034
Temple-Inland 35 1,502
United States Steel Corp. 58 949
Vulcan Materials 67 2,484
Weyerhaeuser Corp. 154 8,316
Worthington Industries Inc. 57 764
--------------
160,244
--------------
TELECOMMUNICATION SERVICES - 2.13%
ALLTEL Corp. 208 10,030
AT&T Corp. 499 9,606
AT&T Wireless Services* 1,804 14,811
BellSouth 1,278 34,033
Century Telephone 93 3,241
Citizens Communications* 171 2,204
Nextel Communications, Inc.* 611 11,047
Qwest Communications Int* 1,133 5,416
SBC Communications Inc. 2,259 57,717
Sprint Corp. FON 580 8,352
Sprint Corp. PCS* 638 3,669
Verizon Communications 1,847 72,863
--------------
232,989
--------------
UTILITIES - 1.48%
AES Corp.* 360 2,286
Allegheny Energy 70 592
Ameren Corporation 91 4,013
American Electric Power 213 6,354
Calpine Corp.* 200 1,320
CenterPoint Energy 195 1,589
CINergy Corp. 105 3,863
CMS Energy 80 648
Consolidated Edison 140 6,059
Constellation Energy Group 99 3,396
Dominion Resources 157 10,090
DTE Energy Co. 94 3,632
Duke Energy 486 9,696
Dynegy Inc.* 201 844
Edison International* 220 3,615
El Paso Corp. 326 2,634
Entergy Corp. 152 8,023
Exelon Corp. 215 12,859
FirstEnergy Corp. 205 7,882
FPL Group 118 7,888
Keyspan Energy 93 3,297
Kinder Morgan 65 3,552
Mirant Corporation* 224 650
NICOR Inc. 31 1,150
NiSource Inc. 139 2,641
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
36
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
BALANCED INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
UTILITIES - 1.48% (CONTINUED)
Peoples Energy 23 $ 986
PG&E Corp.* 255 5,393
Pinnacle West Capital 56 2,097
PPL Corp. 95 4,085
Progress Energy, Inc. 138 6,058
Public Services Enterprise Inc. 143 6,042
Sempra Energy 135 3,852
Southern Co. 463 14,428
TECO Energy 100 1,199
TXU Corp. 174 3,906
Williams Cos. 347 2,741
Xcel Energy Inc 223 3,354
--------------
162,714
--------------
Total Common Stocks
(cost $7,595,245) 5,993,751
--------------
UNIT INVESTMENT TRUST - 2.10%
S&P 500 Depositary Receipt 462 230,602
--------------
Total Unit Investment Trust (cost
$223,879) 230,602
--------------
<Caption>
PRINCIPAL VALUE
U.S. TREASURY OBLIGATIONS - 11.43%
U.S. TREASURY NOTES - 11.43%
6.500% due 05/15/05 $ 200,000 $ 219,344
5.500% due 02/15/08 200,000 227,883
5.500% due 05/15/09 100,000 115,180
6.000% due 08/15/09 50,000 58,979
5.750% due 08/15/10 80,000 93,641
4.375% due 08/15/12 275,000 294,862
6.125% due 11/15/27 200,000 243,453
--------------
Total U.S. Treasury Obligations
(cost $1,167,899) 1,253,342
--------------
U.S. GOVERNMENT AGENCY OBLIGATIONS -
9.48%
FEDERAL HOME LOAN MORTGAGE
CORPORATION - 9.48%
3.500% due 09/15/07 600,000 627,253
5.000% due 05/01/18 398,507 411,952
--------------
Total U.S. Government Agency
Obligations
(cost $1,046,669) 1,039,205
--------------
MORTGAGE-BACKED SECURITIES - 7.68%
FEDERAL HOME LOAN MORTGAGE
CORPORATION - 7.68%
FNCL (7.000% due 07/01/29) 608,821 641,459
FNCL (6.500% due 08/01/32) 192,226 200,459
--------------
Total Mortgage-Backed Securities
(cost $806,167) 841,918
--------------
<Caption>
PRINCIPAL VALUE
CORPORATE BONDS - 9.25%
BANK, BANK HOLDING COMPANIES & OTHER
BANK SERVICES - 1.48%
Key Bank (5.000% due 07/17/07) $ 150,000 $ 162,516
--------------
CAPITAL GOODS - 1.06%
Honeywell International (7.500% due
03/01/10) 50,000 61,099
Masco Corp. (5.875% due 07/15/12) 50,000 55,526
--------------
116,625
--------------
CONSUMER CYCLICALS - 1.65%
Amgen (6.500% due 12/01/07) 50,000 56,582
Ford Motor Credit Corp. (6.375% due
02/01/29) 154,000 124,516
--------------
181,098
--------------
CONSUMER NON-DURABLE - 0.76%
Campbell Soup Co. (5.500% due
03/15/07) 75,000 82,662
--------------
MANUFACTURING - 3.18%
Champion International Corp.(7.200%
due 11/01/26) 138,000 162,850
Rohm & Haas Co.(6.950% due 07/15/04) 100,000 105,168
Weyerhauser Co. (5.250% due 12/15/09) 75,000 80,252
--------------
348,270
--------------
TELECOMMUNICATION - 1.12%
Citizen Communications (9.250% due
05/15/11) 50,000 64,698
Public Services Inc. (6.625% due
02/15/11) 50,000 57,960
--------------
122,658
--------------
Total Corporate Bonds
(cost $916,356) 1,013,829
--------------
<Caption>
SHARES VALUE
SHORT-TERM INVESTMENTS - 6.84%(3)
NORTHERN TRUST DIVERSIFIED ASSETS
PORTFOLIO - 1.83% 201,260 $ 201,260
--------------
<Caption>
PRINCIPAL VALUE
U.S. TREASURY BILL - 5.01%
U.S. Treasury Bill
(1.140% due 09/18/03) $ 550,000 $ 548,962
--------------
Total Short-Term Investments
(cost $750,222) 750,222
--------------
TOTAL INVESTMENTS - 101.46%
(cost $12,506,437)(1) 11,122,869
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(2) - 18.11% 1,985,111
--------------
OTHER ASSETS AND LIABILITIES - (19.57%) (2,144,926)
--------------
TOTAL NET ASSETS - 100.00% $ 10,963,054
==============
</Table>
- -------------
* Non-income producing
(1) For federal income tax purposes, cost is $12,568,337 and gross
unrealized appreciation and depreciation of securities as of
June 30, 2003 was $709,131 and ($2,154,599), respectively.
(2) This security was purchased with cash collateral held from
securities lending.
(3) Securities and other assets with an aggregate value of $486,650
have been segregated with the custodian or designated to cover
margin requirements for the open futures contracts as of June 30, 2003:
<Table>
<Caption>
UNREALIZED
APPRECIATION/
TYPE CONTRACTS (DEPRECIATION)
- -------------------------------------------------------------------
S&P 500 Index (09/03) 2 $(20,300)
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
37
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS NASDAQ-100 INDEX PORTFOLIO
- ---------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
SHARES VALUE
COMMON STOCKS - 79.14%
BASIC INDUSTRIES - 0.58%
Sigma-Aldrich Corporation 887 $ 48,058
Smurfit-Stone Container Corporation* 3,101 40,406
--------------
88,464
--------------
CAPITAL GOODS - 2.06%
Maxim Integrated Products, Inc. 5,862 200,421
PACCAR Inc. 1,685 113,839
--------------
314,260
--------------
CONSUMER DURABLES - 0.21%
Gentex Corporation* 1,027 31,436
--------------
CONSUMER NON-DURABLES - 0.62%
Cintas Corporation 2,649 93,881
--------------
CONSUMER SERVICES - 14.98%
Amazon.com, Inc.* 3,340 121,877
Apollo Group, Inc.* 2,288 141,307
Bed Bath & Beyond Inc.* 5,121 198,746
CDW Corporation* 1,130 51,754
Comcast Corp.* 12,285 370,761
Costco Wholesale Corporation* 3,106 113,680
Dollar Tree Stores, Inc.* 1,422 45,120
eBay Inc.* 3,062 318,999
Fastenal Company 939 31,870
Henry Schein, Inc.* 530 27,740
InterActiveCorp* 6,748 267,018
Lamar Advertising Company* 1,055 37,147
Monster Worldwide Inc.* 1,544 30,463
PanAmSat Corporation* 2,618 48,250
PETsMART, Inc.* 1,787 29,789
Ross Stores, Inc. 989 42,270
Staples, Inc.* 4,118 75,565
Starbucks Corporation* 6,983 171,222
Whole Foods Market, Inc.* 741 35,220
Yahoo! Inc.* 3,677 120,459
--------------
2,279,257
--------------
ENERGY - 0.23%
Patterson-UTI Energy, Inc.* 1,070 34,668
--------------
HEALTH CARE - 12.45%
Amgen Inc.* 7,799 518,166
Biogen, Inc.* 2,372 90,136
Biomet, Inc. 4,516 129,429
Cephalon, Inc.* 654 26,919
Chiron Corporation* 3,386 148,036
DENTSPLY International Inc. 973 39,796
Express Scripts, Inc.* 900 61,488
First Health Group Corp.* 1,279 35,300
Genzyme General* 3,485 145,671
Gilead Sciences, Inc.* 2,507 139,339
Human Genome Sciences, Inc.* 1,662 21,141
ICOS Corporation* 781 28,702
IDEC Pharmaceuticals Corporation* 2,173 73,882
Invitrogen Corporation* 607 23,291
Lincare Holdings Inc.* 1,320 41,593
MedImmune, Inc.* 3,485 126,749
<Caption>
SHARES VALUE
HEALTH CARE - 12.45% (CONTINUED)
Millennium Pharmaceuticals, Inc.* 4,151 $ 65,295
Patterson Dental Company* 844 38,301
Teva Pharmaceutical Industries Limited 2,474 140,845
--------------
1,894,079
--------------
PUBLIC UTILITIES - 1.96%
Nextel Communications, Inc.* 16,547 299,170
--------------
TECHNOLOGY - 45.26%
ADC Telecommunications, Inc.* 12,960 30,171
Adobe Systems Incorporated 2,932 94,029
Altera Corporation* 6,964 114,210
American Power Conversion Corporation* 2,552 39,786
Apple Computer, Inc.* 6,510 124,471
Applied Materials, Inc.* 11,083 175,776
BEA Systems, Inc.* 4,927 53,507
Broadcom Corporation* 2,410 60,033
Brocade Communications Systems, Inc.* 3,383 19,926
Check Point Software Technologies
Ltd.* 3,111 60,820
CIENA Corporation* 6,663 34,581
Cisco Systems, Inc.* 32,398 540,723
Citrix Systems, Inc.* 2,632 53,588
Compuware Corporation* 3,019 17,420
Comverse Technology, Inc.* 2,523 37,921
Dell Computer Corporation* 12,290 392,788
EchoStar Communications Corporation* 3,243 112,273
Electronic Arts Inc.* 1,868 138,213
Fiserv, Inc.* 3,110 110,747
Flextronics International Ltd.* 7,299 75,837
Intel Corporation 29,687 617,015
Intuit Inc.* 3,356 149,443
JDS Uniphase Corporation* 20,738 72,790
Juniper Networks, Inc.* 3,205 39,646
KLA-Tencor Corporation* 2,985 138,773
Linear Technology Corporation 5,416 174,449
LM Ericsson Telephone Company* 1,684 17,901
Mercury Interactive Corporation* 1,165 44,981
Microchip Technology Incorporated 2,191 53,964
Microsoft Corporation 47,705 1,221,725
Molex Incorporated 1,272 34,331
Network Appliance, Inc.* 4,594 74,469
Novellus Systems, Inc.* 1,974 72,290
NVIDIA Corporation* 2,207 50,783
Oracle Corporation* 28,247 339,529
Paychex, Inc. 4,622 135,471
PeopleSoft, Inc.* 5,726 100,720
Pixar* 670 40,763
QLogic Corporation* 1,238 59,833
QUALCOMM Incorporated 12,319 440,404
RF Micro Devices, Inc.* 2,701 16,260
Sanmina-SCI Corporation* 7,056 44,523
Siebel Systems, Inc.* 7,377 70,377
Sun Microsystems, Inc.* 17,995 82,777
Symantec Corporation* 1,999 87,676
Synopsys, Inc.* 888 54,923
Tellabs, Inc.* 3,045 20,006
VeriSign, Inc.* 2,899 40,093
VERITAS Software Corporation* 5,449 156,220
Xilinx, Inc.* 5,795 146,671
--------------
6,885,626
--------------
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
38
<Page>
SUMMIT MUTUTAL FUNDS, INC. - PINNACLE SERIES
NASDAQ-100 INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
TRANSPORTATION - 0.79%
C.H. Robinson Worldwide, Inc. 1,081 $ 38,440
Expeditors International of
Washington, Inc. 1,325 45,899
Ryanair Holdings plc* 787 35,336
--------------
119,675
--------------
Total Common Stocks
(cost $17,061,965) 12,040,516
--------------
UNIT INVESTMENT TRUST(3) - 4.38%
Nasdaq 100 Shares* 21,254 666,507
--------------
Total Unit Investment Trust
(cost $562,885) 666,507
--------------
<Caption>
SHARES VALUE
SHORT-TERM INVESTMENTS(3) - 16.27%
NORTHERN TRUST DIVERSIFIED ASSETS
PORTFOLIO - 5.12% 778,441 $ 778,441
--------------
<Caption>
PRINCIPAL VALUE
U.S. TREASURY BILL - 11.15%
(1.140% due 09/18/03) $ 1,700,000 $ 1,696,792
--------------
Total Short-Term Investments
(cost $2,475,233) 2,475,233
--------------
TOTAL INVESTMENTS - 99.79%
(cost $20,100,083)(1) 15,182,256
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(2) - 8.67% 1,319,606
--------------
OTHER ASSETS AND LIABILITIES - (8.46%) (1,287,823)
--------------
TOTAL NET ASSETS - 100.00% $ 15,214,039
==============
</Table>
- -------------
* Non-income producing
(1) For federal income tax purposes, cost is $20,868,503 and gross
unrealized appreciation and depreciation of securities as of
June 30,2003 was $612,653 and ($6,298,900), respectively.
(2) This security was purchased with cash collateral held from
securities lending.
(3) Securities and other assets with an aggregate value of $2,481,270
have been segregated with the custodian or designated to cover margin
requirements for the open futures contracts as of June 30, 2003:
<Table>
<Caption>
UNREALIZED
APPRECIATION/
TYPE CONTRACTS (DEPRECIATION)
- -------------------------------------------------------------------
Nasdaq-100 Index (09/03) 18 $(73,560)
Nasdaq-100 Index Mini (09/03) 13 $(11,050)
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
39
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- --------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
SHARES VALUE
COMMON STOCKS - 82.06%
BASIC MATERIALS - 2.96%
A. Schulman Inc. 555 $ 8,913
Aceto Corp 167 3,510
AK Steel Holding Corp.* 1,823 6,599
Albemarle Corp. 600 16,782
Allegheny Technologies Inc 1,523 10,052
AMCOL International Corp. 360 2,880
Arch Chemicals Inc. 371 7,086
Brush Engineered Materials Inc.* 251 2,096
Buckeye Technologies Inc.* 502 3,414
Cabot Microelectronics Corp.* 346 17,463
Caraustar Industries Inc.* 493 3,949
Carpenter Technology Corp. 376 5,866
Century Aluminum Co. 232 1,631
Cleveland-Cliffs Inc.* 171 3,052
Coeur Dalene Mines Corp* 2,790 3,878
Crompton Corp. 2,152 15,172
Deltic Timber Corp. 181 5,149
Ethyl Corp* 275 2,736
Ferro Corp. 668 15,050
FMC Corp.* 662 14,981
Georgia Gulf Corp. 524 10,375
Gibraltar Steel Corp. 178 3,645
Glatfelter 535 7,891
Great Lakes Chemical Corp. 681 13,892
H.B. Fuller Co. 534 11,759
Hecla Mining Co.* 2,058 8,705
Hercules, Inc.* 1,702 16,850
IMC Global Inc. 2,039 13,682
Liquidmetal Technologies* 322 1,652
Longview Fibre Co. 961 7,880
Louisiana-Pacific Corp.* 1,968 21,333
MacDermid Inc. 510 13,413
Material Sciences Corp.* 147 1,426
Millennium Chemicals Inc. 1,195 11,364
Minerals Technologies Inc. 327 15,912
NL Industries Inc. 138 2,346
Octel Corp. 188 2,613
Olin Corp. 1,012 17,305
Om Group Inc 534 7,866
Omnova Solutions Inc.* 619 2,501
PolyOne Corp. 1,726 7,681
Pope & Talbot Inc. 294 3,249
Potlatch Corp. 493 12,695
Quaker Chemical Corp. 148 3,707
Reliance Steel & Aluminum Co. 451 9,336
Rock-Tenn Co. 460 7,797
Royal Gold Inc. 301 6,468
RTI International Metals Inc.* 357 3,866
Ryerson Tull Inc. 408 3,582
Schnitzer Steel Industries Inc. 85 3,750
Schweitzer-Mauduit International Inc. 278 6,711
Solutia Inc. 1,970 4,295
Spartech Corp. 434 9,205
Steel Dynamics Inc.* 706 9,672
Stepan Co. 97 2,192
Stillwater Mining Co.* 827 4,251
Symyx Technologies Inc.* 436 7,116
<Caption>
SHARES VALUE
BASIC MATERIALS - 2.96% (CONTINUED)
USEC Inc. 1,545 $ 10,846
Valhi Inc. 503 4,839
W.R. Grace & CO.* 1,233 5,438
Wausau-Mosinee Paper Corp. 694 7,773
Wellman Inc. 600 6,720
--------------
483,858
--------------
COMMUNICATIONS - 7.50%
1-800 Contacts Inc.* 100 2,448
1-800-FLOWERS.COM Inc.* 353 2,909
4 Kids Entertainment Inc.* 228 4,241
ACME Communications Inc.* 157 1,193
Adaptec Inc* 2,017 15,692
Advo Inc.* 375 16,650
Aeroflex Inc.* 983 7,608
Aether Systems Inc.* 685 3,357
Agile Software Corp.* 813 7,845
Akamai Technologies Inc.* 1,934 9,399
Allen Telecom Inc.* 524 8,656
Alloy Inc.* 643 4,147
Anaren Microwave Inc.* 418 3,917
Anixter International Inc.* 585 13,707
APAC Customer Services Inc.* 565 1,441
Applied Signal Technology 165 2,805
Ariba Inc. 5,050 14,999
Arris Group Inc.* 1,000 4,960
Asiainfo Holdings Inc.* 559 4,584
Ask Jeeves Inc* 651 8,951
Aspect Communications Corp.* 578 2,237
Asyst Technologies Inc.* 493 5,379
At Road Inc.* 489 5,340
Audiovox Corp. 313 3,502
Autobytel Inc* 525 2,368
Avanex Corp.* 1,087 4,348
Beasley Broadcast Group Inc.* 77 1,053
Black Box Corp. 320 11,584
Boston Communications Group Inc.* 301 5,156
Broadvision Inc* 483 3,019
Cable Design Technologies Corp.* 800 5,720
C-COR.net Corp.* 593 2,906
Centennial Communications Corp.* 202 808
Centillium Communications Inc.* 551 5,460
Charter Communications, Inc. 4,878 19,366
Cincinnati Bell Inc* 3,234 21,668
Cmgi Inc* 6,945 11,598
CNET Networks Inc.* 1,901 11,843
Commonwealth Telephone Enterprises
Inc.* 407 17,896
CommScope Inc.* 971 9,225
Computer Network Technology Corp.* 508 4,115
Comtech Telecommunications* 142 4,010
Corvis Corporation* 5,754 8,631
Courier Corp. 71 3,657
Crown Media Holdings Inc.* 236 975
CT Communications Inc. 330 3,548
Cumulus Media Inc-* 809 15,314
D & E Communications Inc 242 2,771
Digital Generation Systems* 541 1,039
Digital Insight Corp.* 547 10,420
Digital River Inc.* 476 9,187
Digitalthink Inc* 662 2,085
Digitas Inc.* 292 1,448
Ditech Communications Corp* 487 2,425
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
40
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- --------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
COMMUNICATIONS - 7.50% (CONTINUED)
drugstore.com inc.* 596 $ 3,481
E.piphany Inc.* 1,047 5,350
EarthLink Inc.* 2,218 17,500
Ecollege.Com Inc* 219 2,514
E-Loan Inc* 841 4,903
Emmis Communications* 835 19,159
EMS Technologies Inc.* 201 2,667
Enterasys Networks Inc.* 3,822 11,581
Entrust Inc.* 912 2,681
eResearch Technology Inc.* 337 7,468
eSpeed Inc.* 443 8,754
Extreme Networks Inc.* 1,815 9,620
F5 Networks Inc.* 418 7,043
Findwhat.Com* 209 3,958
Finisar Corp.* 2,593 4,019
Fisher Communications Inc.* 93 4,549
Foundry Networks Inc.* 738 7,749
FreeMarkets Inc.* 697 4,851
FTD Inc* 58 1,169
General Communications Inc.* 830 7,188
Golden Telecom Inc.* 236 5,296
Gray Television, Inc. 751 9,312
Grey Global Group Inc. 17 13,133
GSI Commerce Inc.* 290 1,937
Harmonic Inc.* 1,138 4,632
Harris Interactive Inc.* 799 5,265
Hickory Tech Corp. 243 2,722
Hollinger International Inc. 789 8,498
Homestore Inc.* 1,636 2,896
Hungarian Telephone & Cable* 63 617
Hypercom Corp.* 489 2,029
Inet Technologies Inc.* 245 2,443
Infonet Services Corp.* 1,284 2,042
Information Holdings Inc.* 238 4,344
Infospace Inc* 477 6,473
Insight Communications Co. Inc.* 836 11,018
Interland, Inc.* 2,275 2,230
Internet Security Systems Inc.* 699 10,129
Interwoven Inc.* 1,936 4,298
Intrado Inc.* 272 4,295
Ixia* 432 2,778
j2 Global Communications Inc.* 156 7,173
Jni Corp* 432 2,151
Journal Register Co.* 584 10,565
Kana Software Inc* 434 1,306
Keynote Systems Inc.* 361 3,783
Kvh Industries Inc* 183 4,526
LendingTree Inc.* 316 7,736
Liberty Corp. 306 13,005
Lightbridge Inc.* 511 4,476
LIN TV Corp* 503 11,846
Lionbridge Technologies Inc* 425 2,163
LodgeNet Entertainment Corp.* 197 2,157
LookSmart Ltd.* 1,435 4,061
MarketWatch.Com Inc* 112 936
Martha Stewart Living Omnimedia Inc.* 228 2,141
MasTec Inc.* 371 2,137
MatrixOne Inc.* 809 4,644
McLeod USA Inc.* 1,148 1,688
Mediacom Communications Corp.* 942 9,298
Metro One Telecommunications Inc.* 352 1,816
Mindspeed Tech* 1,680 4,536
<Caption>
SHARES VALUE
COMMUNICATIONS - 7.50% (CONTINUED)
MRV Communications Inc.* 1,869 $ 3,757
Neoforma Inc.* 147 1,605
Net.Bank Inc. 903 11,883
Net2Phone Inc.* 467 2,022
Netegrity Inc.* 481 2,809
Netflix Inc.* 200 5,110
NetRatings Inc.* 190 1,737
Network Equipment Tech Inc* 426 3,587
New Focus Inc.* 1,057 3,953
Newport Corporation* 728 10,774
NIC Inc.* 554 1,618
Nii Holdings Inc* 224 8,572
North Pittsburgh Systems Inc. 282 4,250
Openwave Systems Inc.* 3,399 6,628
Oplink Communications Inc.* 2,078 3,886
Opsware Inc* 900 3,618
Optical Communications Products Inc.* 298 536
Overstock.com Inc.* 166 2,409
Overture Services Inc.* 1,199 21,738
Paxson Communications Corp.* 557 3,336
PC-Tel Inc.* 370 4,388
Pegasus Communications Corp* 59 1,720
Plantronics Inc.* 754 16,339
Playboy Enterprises Inc.* 274 3,726
Portal Software Inc.* 2,343 4,686
Powerwave Technologies Inc.* 1,241 7,781
Price Communications Corp.* 760 9,812
Priceline.Com Inc* 388 8,687
PRIMEDIA Inc.* 2,776 8,467
Primus Telecommunications Group* 924 4,749
ProQuest Co.* 447 11,533
Proxim Corp.* 2,288 3,340
PTEK Holdings Inc.* 803 3,895
Pulitzer Inc. 86 4,250
R.H. Donnelley Corp.* 373 13,603
Raindance Communications Inc.* 899 2,239
RCN Corp.* 1,019 2,018
Regent Communications Inc.* 656 3,870
Register.com Inc.* 615 3,604
Remec Inc.* 1,075 7,482
Riverstone Networks Inc. 2,457 2,899
RSA Security Inc.* 897 9,643
S1 Corp.* 1,305 5,272
Safeguard Scientifics Inc.* 2,245 6,062
Safenet Inc* 161 4,505
Saga Communications Inc.* 255 4,960
Salem Communications Corp.* 163 3,262
Sapient Corp.* 1,455 4,030
Sba Communications Corp* 815 2,478
Secure Computing Corp.* 601 5,247
SeeBeyond Technology Corp.* 903 2,086
Shenandoah Telecommunications Co. 61 2,926
Sinclair Broadcast Group Inc.* 715 8,301
Sohu.Com Inc* 318 10,863
SonicWALL Inc.* 970 4,656
Sonus Networks Inc.* 3,729 18,757
Spanish Broadcasting System Inc.* 595 4,849
SpectraLink Corp.* 301 2,974
Stamps.com Inc.* 687 3,298
Stellent Inc* 331 1,787
Stratex Networks, Inc.* 1,559 4,989
Supportsoft Inc* 466 3,020
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
41
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
COMMUNICATIONS - 7.50% (CONTINUED)
SureWest Communications 274 $ 8,289
Sycamore Networks Inc.* 3,106 11,896
Symmetricom Inc* 708 3,115
Tekelec* 958 10,825
Tellium Inc.* 1,829 1,701
Terayon Communication Systems Inc.* 1,230 3,358
Thestreet.Com Inc* 239 1,123
Thomas Nelson Inc.* 150 1,875
TIBCO Software Inc.* 1,579 8,037
Time Warner Telecom Inc.* 753 4,797
Tollgrade Communications Inc.* 255 4,756
Triton PCS Holdings Inc.* 414 2,091
TriZetto Group Inc.* 583 3,521
Turnstone Systems Inc.* 636 1,596
United Online Inc.* 536 13,582
Value Line Inc. 26 1,277
ValueClick Inc.* 1,242 7,489
ValueVision Media Inc.* 318 4,334
Verity Inc.* 394 4,988
Verso Technologies Inc* 1,688 3,055
ViaSat Inc.* 391 5,607
Vignette Corp.* 3,883 8,077
Vitria Technology Inc* 346 1,983
Warwick Valley Telephone Co 34 2,789
WatchGuard Technologies Inc.* 618 2,843
WebEx Communications, Inc.* 453 6,319
webMethods Inc.* 860 6,992
Websense Inc.* 370 5,794
Westell Technologies Inc* 833 7,205
Western Wireless Corp.* 990 11,415
Wiltel Communications* 495 7,296
World Wrestling Entertainment Inc. 228 2,346
Young Broadcasting Inc.* 236 4,987
--------------
1,226,584
--------------
CONSUMER CYCLICAL - 11.98%
7-Eleven Inc.* 433 4,568
A.C. Moore Arts & Crafts Inc.* 237 4,747
A.S.V. Inc* 124 1,803
Action Performance Cos. 289 5,491
Advanced Marketing Services Inc. 275 3,575
Aeropostale Inc.* 359 7,711
AFC Enterprises Inc. 247 4,011
Aftermarket Technology Corp.* 264 2,775
AirTran Holdings Inc.* 1,242 13,004
Alaska Air Group Inc.* 443 9,502
Alliance Gaming Corp.* 929 17,567
Ambassadors Group Inc.* 98 1,369
Ambassadors International* 112 1,344
AMC Entertainment Inc.* 584 6,681
America West Holdings Corp* 560 1,305
American Eagle Outfitters* 983 18,028
American Greetings* 1,160 22,782
American Woodmark Corp. 103 4,796
Americas Car-Mart Inc* 76 1,382
Ameristar Casinos Inc.* 201 4,291
Angelica Corp. 166 2,814
AnnTaylor Stores Corp.* 839 24,289
Applica Inc.* 360 3,060
Arctic Cat Inc. 279 5,346
Argosy Gaming Co.* 429 8,970
Asbury Automotive Group Inc.* 228 3,073
<Caption>
SHARES VALUE
CONSUMER CYCLICAL - 11.98% (CONTINUED)
Atlantic Coast Airlines Holdings Inc.* 782 $ 10,549
Aviall Inc.* 372 4,230
Aztar Corp.* 531 8,554
Bally Total Fitness Holding Corp.* 561 5,066
Bandag Inc. 215 8,013
Bassett Furniture Industries Inc. 189 2,510
Beazer Homes USA Inc.* 246 20,541
bebe Stores Inc.* 88 1,683
Big 5 Sporting Goods Corp* 240 3,007
BJ's Wholesale Club* 1,304 19,638
Blair Corp. 124 2,753
Blue Rhino Corp* 206 2,470
Bob Evans Farms Inc. 659 18,208
Boca Resorts Inc.* 469 6,097
Bombay Co.* 633 6,729
Boyd Gaming Corp.* 602 10,391
Boyds Collection Ltd.* 356 1,677
Brookfield Homes Corp 296 4,564
Brookstone Inc.* 151 3,058
Brown Shoe Co. Inc. 334 9,953
Buckle Inc.* 141 2,711
Building Materials Holding Corp. 231 3,421
Burlington Coat Factory Warehouse
Corp. 344 6,158
California Pizza Kitchen Inc.* 312 6,708
Callaway Golf Co. 1,238 16,366
Carmike Cinemas Inc.* 25 568
Casey's General Stores Inc. 833 11,779
Cash America International Inc. 456 6,028
Casual Male Retail Group Inc* 568 2,948
Catalina Marketing* 722 12,743
Cato Corp. 314 6,619
Cec Entertainment Inc* 440 16,249
Central European Distribution Corp* 131 2,638
Champion Enterprises Inc.* 985 5,102
Charlotte Russe Holding Inc.* 213 2,198
Charming Shoppes Inc.* 1,918 9,532
Cherokee Inc.* 116 2,322
Chicago Pizza & Brewery Inc.* 203 2,030
Children's Place Retail Stores Inc.* 236 4,687
Choice Hotels International Inc.* 369 10,077
Christopher & Banks Corp* 441 16,313
Churchill Downs Inc. 112 4,291
CKE Restaurants Inc.* 885 4,947
Coachmen Industries Inc. 261 3,119
Coldwater Creek Inc.* 148 1,825
Cole National Corp.* 225 2,817
Collins & Aikman Corp.* 590 1,741
Continental Airlines* 1,237 18,518
Cooper Tire & Rubber 1,231 21,653
Cost Plus Inc.* 402 14,335
CSK Auto Corp.* 625 9,031
Dave & Buster's Inc.* 208 2,267
Deb Shops Inc. 82 1,542
Department 56 Inc.* 233 3,572
DHB Industries Inc.* 380 1,554
Dicks Sporting Goods Inc* 237 8,693
Dillard Inc. 1,158 15,598
Dobson Communications Corp. 361 1,935
Dominion Homes Inc.* 70 1,670
Dover Downs Gaming & Entertainment
Inc. 158 1,462
Dover Motorsports Inc. 273 1,119
Dress Barn Inc.* 357 4,523
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
42
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
CONSUMER CYCLICAL - 11.98% (CONTINUED)
Duane Reade Inc.* 407 $ 6,003
Dura Automotive Systems Inc.* 287 2,815
Electronics Boutique Holdings Corp.* 250 5,778
Emerson Radio Corp* 310 2,083
ExpressJet Holdings Inc.* 566 8,547
Extended Stay America* 1,341 18,090
Finish Line Inc.* 331 7,352
Finlay Enterprises Inc.* 117 1,936
Fleetwood Enterprises Inc.* 676 5,002
Footstar Inc.* 360 4,680
Fred's Inc. 484 17,995
Friedman's Inc. 318 3,616
Frontier Airlines Inc.* 558 5,067
G&K Services Inc. 320 9,472
Galyan's Trading Co. Inc.* 125 1,793
Gamestop Corp* 396 5,116
Gart Sports Co.* 149 4,226
Gaylord Entertainment Co.* 232 4,540
Genesco Inc.* 409 7,239
Goodyear Tire & Rubber 2,837 14,894
Goody's Family Clothing Inc.* 346 2,993
Group 1 Automotive Inc.* 308 9,982
Guess? Inc.* 142 852
Guitar Center Inc.* 254 7,366
Gymboree Corp.* 553 9,279
Hampshire Group Ltd* 38 1,134
Hancock Fabrics Inc. 273 4,409
Handleman Co.* 449 7,184
Haverty Furniture Cos. Inc. 297 5,198
Hibbett Sporting Goods Inc.* 137 4,513
Hollywood Entertainment Corp.* 1,000 17,200
Hooker Furniture Corp 57 1,402
Hot Topic Inc.* 591 15,904
Hughes Supply Inc. 441 15,303
IHOP Corp. 372 11,744
Insight Enterprises Inc.* 868 8,732
Interface Inc.* 819 3,800
Intertan Inc.* 387 3,173
Isle of Capri Casinos Inc.* 284 4,695
J. Jill Group Inc.* 323 5,439
Jack in the Box Inc.* 641 14,294
JAKKS Pacific Inc.* 463 6,153
Jos A Bank Clothiers Inc* 84 2,808
K2 Inc.* 442 5,415
Kellwood Co. 494 15,625
Kenneth Cole Productions Inc.* 106 2,066
Keystone Automotive Industries Inc.* 216 3,944
Kimball International Inc. 414 6,458
Kirklands Inc* 202 3,262
Kmart Corp. 8,318 1
K-Swiss Inc. 227 7,836
La Quinta Corp.* 2,602 11,215
Landry's Restaurants Inc. 407 9,605
LaSalle Hotel Properties 285 16,906
Libbey Inc. 232 5,266
Linens 'N Things Inc.* 830 19,596
Lithia Motors Inc.* 244 3,945
Lone Star Steakhouse & Saloon Inc. 286 6,226
Longs Drug Stores Corp. 559 9,279
M/I Schottenstein Homes Inc. 194 8,280
Macrovision Corporation* 771 15,358
Magna Entertainment Corp.* 740 3,700
<Caption>
SHARES VALUE
CONSUMER CYCLICAL - 11.98% (CONTINUED)
Marcus Corp. 362 $ 5,412
Marine Products Corp. 106 1,150
MarineMax Inc.* 153 2,142
Maxwell Shoe Co.* 260 3,744
Men's Wearhouse Inc.* 653 14,268
Meritage Corp.* 170 8,374
Mesa Air Group Inc.* 496 3,968
Mesaba Holdings Inc.* 179 1,104
Mobile Mini Inc.* 249 4,066
Modine Manufacturing Co. 436 8,445
Modtech Holdings Inc.* 147 1,351
Monaco Coach Corp.* 479 7,343
Mothers Work Inc.* 77 2,061
Movado Group Inc. 138 3,002
Movie Gallery Inc.* 455 8,395
MTR Gaming Group Inc.* 429 3,312
Multimedia Games Inc.* 200 5,100
National Presto Industries Inc. 88 2,781
Nautica Enterprises Inc.* 480 6,158
Nautilus Group Inc. 537 6,659
Navigant International Inc.* 237 3,057
Noland Co 12 427
Northwest Airlines Corp* 1,143 12,904
Nu Skin Enterprises Inc. 598 6,249
O'Charley's Inc.* 376 8,095
OfficeMax Inc.* 2,338 15,314
Oneida Ltd. 274 1,850
Orleans Homebuilders Inc* 31 332
Oshkosh B'Gosh Inc. 148 3,996
Owens & Minor Inc. 593 13,254
Oxford Industries Inc. 109 4,526
P.F. Chang's China Bistro Inc.* 476 23,424
Pacific Sunwear of California Inc.* 886 21,344
Palm Harbor Homes Inc.* 324 6,137
Panera Bread Co.* 523 20,920
Pantry Inc* 100 789
Papa John's International Inc.* 212 5,947
Party City Corp.* 189 1,941
Payless Shoesource Inc.* 1,279 15,988
PC Connection Inc.* 126 857
Pegasus Solutions Inc.* 466 7,573
Penn National Gaming Inc.* 579 11,898
Pep Boys-Manny Moe & Jack 904 12,213
Perry Ellis International* 69 1,347
Petco Animal Supplies Inc* 674 14,680
Phillips-Van Heusen Corp. 469 6,392
Pinnacle Entertainment Inc.* 405 2,754
Prime Hospitality Corp.* 694 4,657
Quiksilver Inc.* 1,021 16,836
Rare Hospitality International Inc.* 370 12,092
Raytech Corp.* 134 570
RC2 Corp* 252 4,287
Red Robin Gourmet Burgers 165 3,221
Restoration Hardware Inc.* 361 1,625
Rex Stores Corp.* 129 1,562
Russell Corp. 495 9,405
Ryan's Family Steak Houses Inc.* 793 11,102
ScanSource Inc.* 201 5,377
School Specialty Inc.* 307 8,737
Scientific Games Corp.* 927 8,714
SCP Pool Corp.* 375 12,900
Select Comfort Corporation* 369 6,044
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
43
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- --------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
CONSUMER CYCLICAL - 11.98% (CONTINUED)
Sequenom Inc. 286 $ 7,236
Sharper Image Corp.* 176 4,800
Shoe Carnival Inc.* 136 2,007
Shopko Stores Inc.* 515 6,695
Shuffle Master Inc.* 313 9,199
Six Flags Inc.* 1,743 11,818
Skechers USA Inc.* 350 2,590
Skyline Corp. 114 3,420
Skywest Inc 1,085 20,680
Smart & Final Inc.* 232 1,074
Sonic Automotive Inc* 512 11,218
Sonic Corp.* 728 18,513
Speedway Motorsports Inc. 265 7,102
Sports Authority Inc.* 621 6,645
Sports Resorts International Inc.* 26 127
Stage Stores Inc.* 276 6,486
Standard Motor Products Inc. 124 1,376
Standard Pacific Corp. 606 20,095
Stanley Furniture Co. 92 2,522
Steak N Shake Co.* 416 6,344
Stein Mart Inc.* 381 2,282
Steinway Musical Instruments Inc.* 83 1,278
Steven Madden Ltd.* 188 4,106
Strattec Security Corp.* 60 3,192
Stride Rite Corp. 693 6,902
Superior Industries International Inc. 420 17,514
Systemax Inc* 173 654
TBC Corp.* 316 6,020
Technical Olympic USA Inc.* 44 1,040
Tenneco Automotive Inc.* 788 2,837
Thor Industries Inc. 336 13,716
TiVo Inc.* 593 7,223
Too Inc.* 642 13,001
Topps Co.* 587 5,042
Toro Co. 460 18,285
Tower Automotive Inc.* 1,058 3,872
Tractor Supply Co.* 274 13,084
Trans World Entertainment Corp.* 257 1,316
Triarc Cos.* 231 6,928
Tuesday Morning Corp.* 257 6,759
Tweeter Home Entertainment Group Inc.* 376 3,264
Ultimate Electronics Inc.* 206 2,641
Unifi Inc.* 768 4,762
UniFirst Corp. 169 3,701
United Auto Group Inc.* 300 6,534
United Stationers Inc.* 575 20,798
Universal Electronics Inc.* 256 3,246
Urban Outfitters Inc.* 231 8,293
US Airways Group Inc"+" 1,480 1
USFreightways Corp.* 671 1,939
Vail Resorts Inc.* 352 4,741
Vans Inc.* 339 3,044
Visteon Corp. 2,459 16,893
Wabash National Corp.* 483 6,776
Warnaco Group Inc (The)* 651 8,743
Watsco Inc. 353 5,846
WCI Communities* 317 6,096
Wesco International Inc.* 300 1,800
West Marine Inc.* 224 3,922
Wet Seal Inc.* 420 4,486
Weyco Group Inc 35 1,610
Whitehall Jewellers Inc.* 201 1,823
<Caption>
SHARES VALUE
CONSUMER CYCLICAL - 11.98% (CONTINUED)
William Lyon Homes Inc.* 79 $ 2,516
Wilsons The Leather Experts Inc.* 325 2,343
Winnebago Industries Inc. 234 8,869
WMS Industries Inc.* 414 6,454
Wolverine World Wide Inc. 751 14,464
World Fuel Services Corp. 177 4,352
Zale Corp* 604 24,162
--------------
1,960,457
--------------
CONSUMER NON-CYCLICAL - 15.62%
aaiPharma Inc.* 262 5,209
Aaron Rents Inc. 299 7,714
Abgenix Inc.* 1,654 17,350
Able Laboratories Inc* 248 4,910
ABM Industries Inc. 708 10,903
Accredo Health Inc* 899 19,598
Aclara Biosciences Inc* 456 1,924
Administaff Inc.* 369 3,801
Adolor Corp.* 594 7,288
Advanced Medical Optics* 546 9,309
Advanced Neuromodulation Systems Inc.* 228 11,804
Advisory Board Co.* 183 7,415
Aksys Ltd.* 518 6,708
Alaris Medical Inc.* 283 3,665
Albany Molecular Research Inc.* 494 7,459
Alderwoods Group Inc.* 698 3,811
Alexion Pharmaceuticals Inc.* 308 5,251
Alico Inc. 66 1,630
Align Technology Inc.* 832 10,442
Alkermes Inc.* 879 9,449
Alliance Imaging Inc.* 224 986
Alpharma Inc. 728 15,725
Alteon Inc* 634 3,259
American Healthways Inc.* 246 8,886
American Italian Pasta Co.* 281 11,704
American Medical Security Group Inc.* 215 4,107
American Medical Systems Holdings
Inc.* 387 6,529
AMERIGROUP Corp.* 389 14,471
Amn Healthcare Services Inc* 340 4,318
Amsurg Inc.* 332 10,126
Antigenics Inc.* 370 4,262
Aphton Corp.* 404 3,329
Arbitron Inc.* 560 19,992
Arden Group Inc.* 26 1,534
Arena Pharmaceuticals Inc.* 349 2,317
Ariad Pharmaceuticals Inc.* 656 2,945
Arrow International Inc. 217 9,581
ArthroCare Corp.* 334 5,598
Aspect Medical Systems Inc* 174 1,284
AtheroGenics Inc.* 685 10,227
Atrix Laboratories Inc.* 387 8,510
Avant Immunotherapeutics Inc* 1,138 3,289
Avi Biopharma Inc* 390 2,363
Bankrate Inc* 106 1,285
Banta Corp. 443 14,340
Bentley Pharmaceuticals Inc.* 241 3,169
Beverly Enterprises Inc.* 1,716 6,006
Biolase Technology Inc* 354 3,798
BioMarin Pharmaceutical Inc.* 1,193 11,644
Biopure Corp.* 575 3,513
BioReliance Corp.* 95 2,014
Biosite Inc.* 196 9,428
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
44
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
CONSUMER NON-CYCLICAL - 15.62%
(CONTINUED)
Bone Care International Inc.* 176 $ 2,446
Boston Beer Co.* 139 2,002
Bowne & Co. 633 8,248
Bradley Pharmaceuticals Inc. 153 2,525
Bright Horizons Family Solutions Inc.* 223 7,484
Bruker AXS Inc.* 325 998
Bruker Daltonics Inc. 206 1,098
Cambrex Corp. 363 8,356
Candela Corp* 145 1,670
Cantel Medical Corp.* 127 1,704
Cardiac Science Inc.* 968 2,594
CardioDynamics International Corp.* 625 2,131
CDI Corp.* 229 5,945
Celera Genomics Group - Applera Corp.* 1,355 13,984
Cell Genesys Inc.* 646 5,581
Cell Therapeutics Inc.* 587 5,712
Centene Corp.* 184 7,158
Central Garden & Pet Co.* 297 7,083
Central Parking Corp. 340 4,202
Century Business Services Inc.* 1,526 4,960
Cepheid* 531 2,623
Cerus Corp.* 276 2,078
Charles River Associates Inc.* 135 3,816
Chattem Inc.* 266 5,001
Chiquita Brands International Inc.* 647 9,382
Cholestech Corp.* 256 2,527
Chronimed Inc* 235 2,310
Cima Labs Inc.* 269 7,233
Ciphergen Biosystems Inc.* 404 4,141
Clark Inc* 294 3,513
Closure Medical Corp.* 126 2,379
Cobalt Corp.* 317 6,514
Coca-Cola Bottling Co. Consolidated 68 3,713
Coinstar Inc.* 408 7,695
Collagenex Pharmaceuticals* 144 1,642
Columbia Laboratories Inc.* 567 6,379
Conceptus Inc.* 326 4,580
CONMED Corp.* 545 9,952
Connetics Corp.* 526 7,874
Consolidated Graphics Inc.* 209 4,782
Cooper Cos. 582 20,236
Corixa Corp.* 781 6,037
Corn Products International Inc. 678 20,360
Cornell Cos. Inc.* 232 3,512
Corrections Corp. of America* 659 16,692
Corvel Corp.* 122 4,392
CoStar Group Inc.* 250 7,465
Covance Inc.* 1,156 20,924
CPI Corp. 152 2,683
Cross Country Healthcare Inc* 363 4,788
CryoLife Inc.* 307 3,177
CSS Industries Inc. 58 2,236
Cti Molecular Imaging Inc* 455 8,604
Cubist Pharmaceuticals Inc.* 556 5,927
CuraGen Corp.* 806 4,473
Curative Health Services Inc.* 200 3,400
CV Therapeutics Inc.* 532 15,779
Cyberonics Inc.* 374 8,045
Cytyc Corporation* 2,110 22,197
D&K Healthcare Resources Inc. 237 3,825
Dade Behring Holdings Inc* 754 17,319
Datascope Corp. 198 5,847
<Caption>
SHARES VALUE
CONSUMER NON-CYCLICAL - 15.62%
(CONTINUED)
deCODE genetics Inc.* 858 $ 2,677
Del Laboratories Inc.* 86 2,021
Delta & Pine Land Co. 705 15,496
Dendreon Corp* 149 885
Diagnostic Products Corp 383 15,722
Digene Corp.* 234 6,372
DIMON Inc. 780 5,585
Discovery Laboratories Inc* 531 3,409
Diversa Corp.* 365 3,588
dj Orthopedics Inc.* 123 1,348
Dollar Thrifty Automotive Group Inc.* 431 7,995
Dov Pharmaceutical Inc* 196 2,215
Durect Corp.* 551 1,328
Dynacq International Inc.*+ 107 1,798
Electro Rent Corp.* 314 3,385
Elizabeth Arden Inc.* 222 2,924
Encysive Pharmaceuticals Inc* 833 3,998
Ennis Business Forms Inc. 307 4,467
Enzo Biochem Inc.* 423 9,103
Enzon Inc.* 818 10,241
EPIX Medical Inc.* 240 3,396
Esperion Therapeutics Inc.* 554 10,853
Euronet Worldwide Inc.* 300 3,243
EXACT Sciences Corp.* 275 3,014
Exactech Inc* 112 1,613
Exelixis Inc.* 924 6,413
Exult Inc.* 628 5,382
Farmer Bros. Co. 14 4,750
First Commonwealth Financial Corp.* 882 8,141
First Consulting Group Inc.* 358 1,672
First Horizon Pharmaceutical Corp.* 381 1,505
Flowers Foods Inc. 1,104 21,815
Forrester Research Inc.* 261 4,270
Fossil Inc.* 454 10,696
FTI Consulting Inc.* 775 19,352
Gartner Group, Inc.* 1,469 11,135
Gene Logic Inc.* 584 3,486
Genencor International Inc.* 161 2,652
Genesis Health Ventures Inc.* 454 8,013
Gen-Probe Corp 448 18,310
Genta Inc.* 883 11,762
Gentiva Health Services Inc.* 470 4,230
Geron Corp.* 557 4,100
Gevity HR Inc 258 3,050
Great Atlantic & Pacific Tea Co.* 278 2,446
Green Mountain Coffee Inc.* 67 1,273
Gtc Biotherapeutics Inc* 435 1,449
Guilford Pharmaceuticals Inc.* 426 1,934
Haemonetics Corp.* 301 5,629
Hain Celestial Group Inc.* 419 6,700
Hanger Orthopedic Group Inc.* 389 4,454
Healthcare Services Group Inc.* 176 2,487
HealthExtras Inc.* 291 2,276
Heidrick & Struggles International
Inc.* 306 3,862
Hi-Tech Pharmacal Co Inc* 83 3,376
Hollis-Eden Pharmaceuticals* 127 1,579
Hologic Inc.* 370 4,877
Hooper Holmes Inc. 1,068 6,878
Horizon Organic Holding Corp.* 117 2,788
Hudson Highland Group Inc* 139 2,642
ICT Group Inc.* 103 1,077
ICU Medical Inc.* 198 6,168
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
45
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
CONSUMER NON-CYCLICAL - 15.62%
(CONTINUED)
iDine Rewards Networks Inc.* 422 $ 5,798
IGEN International, Inc.* 338 10,613
ILEX Oncology Inc.* 615 11,937
Immucor Inc.* 240 5,230
Immunogen Inc.* 764 3,262
Immunomedics Inc.* 785 4,953
Impath Inc.* 294 4,157
Impax Laboratories Inc.* 516 6,187
Inamed Corp.* 335 17,986
INCYTE Genomics Inc* 1,349 6,259
Indevus Pharmaceuticals Inc.* 706 4,405
Ingles Markets Inc. 161 1,626
Inspire Pharmaceuticals Inc* 527 5,692
Insurance Auto Auctions Inc.* 164 2,060
Integra LifeSciences Holdings Corp.* 335 8,837
Integrated Electrical Services Inc.* 595 4,314
Inter Parfums Inc.* 64 474
Intermagnetics General Corp.* 434 10,776
InterMune Inc.* 471 7,588
International Multifoods Corp.* 330 7,560
Interpore International* 327 4,163
Interstate Bakeries Corp. 843 10,706
Intuitive Surgical Inc* 300 4,494
Invacare Corp. 494 16,302
Inveresk Research Group Inc* 557 10,020
Inverness Medical Innovations Inc.* 192 3,706
Ipayment Inc* 103 2,459
ISIS Pharmaceuticals Inc.* 836 4,431
I-Stat Corp* 290 2,558
J&J Snack Foods Corp.* 116 3,669
Jarden Corp.* 269 7,443
John B. Sanfilippo & Son* 101 1,872
John H. Harland Co. 523 13,682
KV Pharmaceutical Co 428 11,898
Kelly Services Inc. 315 7,387
Kensey Nash Corp.* 145 3,770
Kindred Healthcare Inc.* 222 3,960
Korn/Ferry International* 597 4,836
KOS Pharmaceuticals Inc.* 196 4,600
Kosan Biosciences Inc.* 332 1,959
Kroll Inc.* 679 18,374
Kyphon Inc.* 338 5,111
La Jolla Pharmaceutical Co.* 801 2,619
LabOne Inc.* 139 2,997
Labor Ready Inc.* 753 5,399
Lance Inc. 465 4,245
Landauer Inc. 150 6,275
Lannett Co. Inc.* 110 2,578
Laserscope* 246 1,966
Learning Tree International Inc.* 171 2,673
Lexicon Genetics Inc.* 591 3,966
Lifeline Systems Inc.* 89 2,528
LifePoint Hospitals* 705 14,763
Ligand Pharmaceuticals Inc.* 1,073 14,582
Luminex Corporation* 395 2,038
M & F Worldwide Corp* 192 1,248
Mail-Well Inc.* 570 1,436
Martek Biosciences Corp.* 427 18,335
Matria Healthcare Inc.* 175 3,089
Maui Land & Pineapple Co. Inc.* 58 1,304
Maximus Inc.* 290 8,013
Maxygen Inc.* 427 4,684
<Caption>
SHARES VALUE
CONSUMER NON-CYCLICAL - 15.62%
(CONTINUED)
McGrath RentCorp 143 $ 3,824
Medarex Inc.* 1,387 9,140
Medical Action Ind Inc* 146 2,384
Medical Staffing Networks Holdings
Inc.* 206 1,442
Medicines Co.* 785 15,457
MedQuist Inc.* 192 3,886
MemberWorks Inc.* 140 2,765
Mentor Corp. 765 14,826
Meridian Bioscience Inc 185 1,735
Merit Medical Systems Inc.* 233 4,655
MGI Pharma Inc.* 478 12,251
Micro Therapeutics Inc* 188 799
Midas Inc.* 264 3,200
MIM Corp.* 418 2,730
Monro Muffler Brake Inc.* 118 3,335
MPS Group Inc.* 1,774 12,205
Myriad Genetics Inc.* 508 6,914
Nabi Biopharmaceuticals* 736 5,049
Nash Finch Co.* 210 3,497
National Beverage Corp.* 68 945
National Healthcare Corp.* 123 2,421
National Processing Inc* 145 3,741
Nature's Sunshine Products Inc. 173 1,386
Navigant Consulting Inc.* 787 9,326
NBTY Inc.* 969 20,407
NCO Group Inc.* 342 6,125
NeoPharm Inc.* 245 3,393
Neose Technologies Inc.* 262 2,623
New England Business Service Inc. 190 5,700
Newtek Business Services Inc* 159 844
Noven Pharmaceuticals Inc.* 381 3,901
Novoste Corporation* 307 1,845
NPS Pharmaceuticals Inc.* 553 13,460
Nuvelo Inc* 768 1,536
Oakley Inc.* 466 5,485
Ocular Sciences Inc.* 350 6,948
Odyssey HealthCare Inc.* 401 14,837
Omega Protein Corp* 114 579
Onyx Pharmaceuticals Inc.* 448 5,524
Option Care Inc.* 241 2,779
OraSure Technologies Inc.* 643 4,797
Orthodontic Centers Of America* 945 7,569
Orthologic Corp.* 619 2,841
OSI Pharmaceuticals Inc.* 729 23,481
Osteotech Inc* 288 3,724
Pain Therapeutics Inc.* 335 2,164
Palatin Technologies Inc* 787 2,511
PAREXEL International Corp.* 483 6,738
Pathmark Stores Inc.* 509 3,894
PDI Inc.* 130 1,321
Pediatrix Medical Group Inc.* 444 15,829
Peet's Coffee and Tea Inc.* 198 3,457
Penwest Pharmaceuticals Co.* 260 6,336
Peregrine Pharmaceuticals Inc.* 1,956 2,914
Perrigo Co. 1,150 17,986
Pharmacopeia Inc.* 445 3,671
Pilgrim's Pride Corp. 284 2,746
Playtex Products Inc.* 558 3,582
Plexus Corp.* 754 8,694
PolyMedica Corp. 170 7,784
Possis Medical Inc.* 294 4,034
Pozen Inc.* 425 4,667
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
46
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
CONSUMER NON-CYCLICAL - 15.62%
(CONTINUED)
Praecis Pharmaceuticals Inc.* 844 $ 4,136
Pre-Paid Legal Services Inc.* 296 7,261
PRG-Schultz International Inc.* 735 4,337
Princeton Review Inc.* 301 1,776
Priority Healthcare Corp.* 650 12,058
Progenics Pharmaceuticals Inc.* 151 2,274
Province Healthcare Co.* 863 9,553
PSS World Medical Inc.* 1,277 7,343
Quanta Services Inc.* 1,377 9,777
Quidel Corp.* 510 3,172
Ralcorp Holdings Inc.* 544 13,578
Regeneration Technologies* 437 5,637
Regeneron Pharmaceuticals Inc.* 644 10,143
RehabCare Group Inc.* 299 4,380
Rent-Way Inc.* 397 1,846
Repligen Corp* 514 2,616
Resources Connection Inc.* 371 8,852
Retractable Technologies Inc* 116 985
Revlon Inc.* 192 576
Ribapharm Inc* 562 3,625
Right Management Consultants Inc.* 308 3,896
Riviana Foods Inc. 112 3,014
Robert Mondavi Corp.* 177 4,480
Rollins Inc. 359 6,767
Roto-Rooter Inc 185 7,056
Ruddick Corp. 614 9,652
Russ Berrie & Co. 169 6,170
Salix Pharmaceuticals Ltd.* 336 3,525
Sanderson Farms Inc. 98 2,754
SangStat Medical Corp.* 498 6,519
Savient Pharmaceuticals Inc* 1,055 4,895
ScanSoft Inc.* 770 10,919
Sciclone Pharmaceuticals Inc* 707 6,052
Seaboard Corp. 7 1,449
Seattle Genetics Inc.* 397 2,045
Seminis Inc.* 276 1,016
Sensient Technologies Corp. 746 17,151
Serologicals Corp.* 426 5,806
Sfbc International Inc* 98 1,774
Sierra Health Services Inc.* 438 8,760
Sirna Therapeutics Inc* 121 1,066
SM&A* 229 2,601
Sola International Inc.* 433 7,534
SonoSite Inc.* 268 5,347
Sotheby's Holdings Inc.* 839 6,242
Source Interlink Cos Inc* 218 1,650
SOURCECORP, Incorporated* 287 6,199
Specialty Laboratories Inc.* 131 1,343
Spherion Corp.* 1,116 7,756
Staar Surgical Co* 322 3,726
Standard Commercial Corp. 186 3,162
Standard Register Co. 221 3,642
Star Scientific Inc* 461 1,554
StarTek Inc.* 197 5,181
Stewart Enterprises Inc.* 1,817 7,813
Strayer Education Inc. 200 15,890
Sunrise Assisted Living Inc.* 313 7,005
SuperGen Inc.* 553 2,986
SurModics Inc.* 263 8,022
Sybron Dental Specialties Inc.* 718 16,945
Sylvan Learning Systems Inc.* 625 14,275
Synovis Life Technologies Inc* 159 3,139
<Caption>
SHARES VALUE
CONSUMER NON-CYCLICAL - 15.62%
(CONTINUED)
Tanox Inc.* 449 $ 7,206
Techne Corp.* 767 23,271
Tejon Ranch Co.* 130 3,913
Teletech Holdings Inc.* 652 2,758
Telik Inc.* 604 9,706
Theragenics Corp.* 563 2,421
TheraSense Inc.* 453 4,530
Third Wave Technologies* 451 2,039
Thoratec Corp.* 897 13,365
Transkaryotic Therapies Inc.* 554 6,393
Trimeris Inc.* 256 11,694
TriPath Imaging Inc.* 415 2,834
Tularik Inc.* 826 8,210
Tupperware Corp. 979 14,058
U.S. Physical Therapy Inc.* 224 2,863
United Natural Foods Inc.* 360 10,130
United Surgical Partners International
Inc.* 324 7,319
United Therapeutics Corp.* 328 7,144
Universal Corp. 467 19,754
US Oncology Inc.* 1,292 9,548
Usana Health Sciences Inc* 83 3,669
VCA Antech Inc.* 569 11,135
Vector Group Ltd. 417 7,298
Ventana Medical Systems Inc.* 231 6,279
Vertex Pharmaceuticals* 1,443 21,058
Viasys Healthcare Inc.* 562 11,633
Virbac Corp.* 165 1,000
Vistacare Inc* 216 5,251
VISX Inc.* 764 13,255
Vital Images Inc* 168 3,088
Vital Signs Inc. 109 2,830
VIVUS Inc.* 626 3,218
Volt Information Sciences Inc.* 149 2,034
Wackenhut Corrections Corp.* 174 2,386
Watson Wyatt & Co. Holdings* 620 14,372
WD-40 Co. 312 8,908
Weis Markets Inc. 210 6,514
West Pharmaceutical Services Inc. 203 4,974
Whitman Education Group Inc* 170 2,610
Wild Oats Markets Inc.* 466 5,079
Wireless Facilities Inc.* 502 5,974
Wright Medical Group Inc.* 296 5,630
Yankee Candle Co. Inc.* 586 13,607
Young Innovations Inc.* 76 2,166
Zoll Medical Corp.* 160 5,370
ZymoGenetics Inc.* 239 2,782
--------------
2,555,887
--------------
DIVERSIFIED - 0.06%
Resource America Inc. 278 2,877
Walter Industries Inc. 560 6,580
--------------
9,457
--------------
ENERGY - 3.45%
Arch Coal Inc. 867 19,924
Atwood Oceanics Inc.* 149 4,045
Berry Petroleum Co. 298 5,349
Cabot Oil & Gas Corp. 472 13,032
Cal Dive International Inc.* 660 14,388
Carbo Ceramics Inc. 193 7,189
Cimarex Energy Co* 781 18,549
Clayton Williams Energy Inc* 65 1,200
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
47
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
ENERGY - 3.45% (CONTINUED)
Comstock Resources Inc.* 536 $ 7,332
Denbury Resources Inc.* 644 8,649
Dril-Quip Inc.* 117 2,129
Encore Acquisition Co.* 165 3,160
Energy Partners Ltd.* 396 4,574
Evergreen Resources Inc.* 364 19,769
Exco Resources Inc* 96 1,724
Forest Oil* 759 19,066
Frontier Oil Corp. 492 7,478
FuelCell Energy Inc.* 639 5,233
Global Industries Ltd.* 1,339 6,454
Grey Wolf Inc.* 3,168 12,799
Gulf Island Fabrication Inc.* 132 2,233
Hanover Compressor Co.* 975 11,018
Harvest Natural Resources Inc.* 663 4,223
Headwaters Inc.* 490 7,198
Holly Corp. 186 5,134
Horizon Offshore Inc.* 497 2,475
Houston Exploration Co.* 256 8,883
Hydril Co.* 259 7,058
Input/Output Inc.* 831 4,471
Kcs Energy Inc* 640 3,450
KFX Inc* 472 1,831
Lone Star Technologies Inc.* 474 10,039
Lufkin Industries Inc. 108 2,630
Magnum Hunter Resources Inc.* 1,265 10,107
Massey Energy Co. 1,156 15,201
Matrix Service Co* 150 2,573
Maverick Tube Corp.* 788 15,090
Mcmoran Exploration Co* 221 2,462
Meridian Resource Corp.* 663 3,136
Newpark Resources Inc.* 1,366 7,486
North Coast Energy Inc* 41 380
Nuevo Energy Co.* 330 5,759
Oceaneering International Inc.* 423 10,808
Oil States International Inc.* 477 5,772
Parker Drilling Co.* 1,632 4,749
Patina Oil & Gas Corp. 561 18,036
Penn Virginia Corp. 136 5,848
Petrocorp Inc* 101 1,126
Petroleum Development Corp* 295 2,711
Plains Resources Inc.* 378 5,349
Plug Power Inc.* 437 2,041
Prima Energy Corp.* 168 3,508
Quicksilver Resources Inc.* 211 5,053
Range Resources Corp.* 985 6,176
Remington Oil & Gas Corp.* 394 7,242
RPC Inc. 182 2,002
S&T Bancorp Inc.* 723 7,816
SEACOR SMIT Inc.* 321 11,713
Southwestern Energy Co.* 669 10,042
Spinnaker Exploration Co.* 465 12,183
St. Mary Land & Exploration Co. 529 14,442
Stone Energy Corp.* 425 17,815
Superior Energy Services Inc.* 904 8,570
Swift Energy Co.* 483 5,313
Tesoro Petroleum Corp.* 1,087 7,479
Tetra Technologies Inc.* 250 7,413
Tom Brown Inc.* 594 16,507
Transmontaigne Inc.* 325 2,106
Unit Corp.* 690 14,428
Universal Compression Holdings Inc.* 318 6,633
<Caption>
SHARES VALUE
ENERGY - 3.45% (CONTINUED)
Veritas DGC Inc.* 579 $ 6,659
Vintage Petroleum Inc. 931 10,502
Westmoreland Coal Co* 118 1,359
W-H Energy Services Inc.* 419 8,162
--------------
564,443
--------------
FINANCIAL - 17.91%
1st Source Corp. 238 4,417
21St Century Insurance Group 434 6,206
ABC Bancorp 184 2,637
Acadia Realty Trust 267 2,443
Accredited Home Lenders* 182 3,571
Advanta Corp. 380 3,823
Affiliated Managers Group* 396 24,136
Alabama National BanCorp 183 8,872
Alexander's Inc.* 37 3,089
Alexandria Real Estate Equities Inc. 358 16,110
Alfa Corp. 635 8,071
Allegiant Bancorp Inc. 242 4,901
Allmerica Financial* 1,001 18,008
Amcore Financial Inc. 468 10,895
American Home Mortgage Holdings Inc. 214 4,190
American Land Lease Inc 96 1,402
American Mortgage Acceptance 152 2,639
American National Bankshares Inc. 86 2,313
American Physicians Capital Inc.* 164 3,977
American Realty Investors Inc* 40 366
Americanwest Bancorporation* 173 2,834
AmerUs Group Co. 735 20,720
AMLI Residential Properties Trust 265 6,241
Anchor Bancorp Wisconsin Inc. 391 9,341
Anthracite Capital Inc. 900 10,854
Anworth Mortgage Asset Corp. 597 9,206
Apex Mortgage Capital Inc. 562 3,074
Argonaut Group Inc. 380 4,685
Arrow Financial Corp. 126 4,205
Associated Estates Realty Corp. 308 2,024
Avatar Holdings Inc.* 98 2,960
Baldwin & Lyons Inc. 142 3,373
BancFirst Corp. 68 3,526
Banctrust Financial Group Inc 126 2,031
Bank Mutual Corp. 192 6,240
Bank of Granite Corp. 249 4,245
Bank of the Ozarks Inc. 91 3,527
BankAtlantic Bancorp Inc. 791 9,405
BankUnited Financial Corp.* 536 10,800
Banner Corp. 187 3,832
Bay View Capital Corp.* 1,198 6,924
Bedford Property Investors Inc. 248 7,043
Berkshire Hills Bancorp Inc. 101 2,868
Boston Private Financial Holdings Inc. 378 7,968
Boykin Lodging Co. 326 2,543
Brandywine Realty Trust 489 12,039
Brookline Bancorp Inc. 1,084 15,176
BRT Realty Trust 66 1,049
Bryn Mawr Bank Corp. 66 2,447
BSB Bancorp Inc. 152 3,773
C & F Financial Corp 63 2,473
Camco Financial Corp 142 2,214
Camden National Corp. 151 4,153
Capital Automotive REIT 464 12,987
Capital City Bank Group Inc. 165 5,973
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
48
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
FINANCIAL - 17.91% (CONTINUED)
Capital Corp Of The West* 93 $ 2,338
Capitol Bancorp Ltd. 164 4,444
Capstead Mortgage Corp. 187 2,107
Cascade Bancorp 237 4,107
Cathay Bancorp Inc. 292 13,017
Cavalry Bancorp Inc 96 1,630
CB Bancshares Inc. 81 5,032
CCBT Financial Cos. Inc. 159 3,799
Center Bancorp Inc 142 2,119
Center Financial Corp* 87 1,310
Central Coast Bancorp* 154 2,583
Central Pacific Financial Co 270 7,479
Century Bancorp Inc. 60 1,787
CFS Bancorp Inc. 181 2,552
Charter Financial Corporation 75 2,119
Charter Municipal Mortgage Acceptance
Co. 776 14,752
Chateau Communities Inc. 391 11,570
Chemical Financial Corp. 446 13,291
Chittenden Corp. 630 17,231
Citizens Banking Corp 814 21,986
Citizens First Bancorp Inc. 161 3,516
Citizens Inc.* 503 3,657
Citizens South Banking Corp 168 2,224
City Bank 151 4,086
City Holding Co. 313 9,162
CNA Surety Corp. 292 2,876
CNB Financial Corp 69 2,906
Coastal Bancorp Inc. 76 2,160
Coastal Financial Corp. 177 2,285
CoBiz Inc. 155 2,099
Colonial Properties Trust 299 10,522
Columbia Bancorp - Maryland 142 1,896
Columbia Bancorp - Oregon 103 2,472
Columbia Banking System Inc. 251 4,495
Commerce Group Inc. 435 15,747
Commercial Bankshares Inc 64 1,902
Commercial Capital Bancorp* 94 1,443
Commercial Federal Corp. 832 17,638
Commercial Net Lease Realty Inc. 680 11,723
Community Bank Of North Virg 77 896
Community Bank System Inc. 214 8,132
Community Banks Inc. 153 4,550
Community First Bankshares Inc. 685 18,701
Community Trust Bancorp Inc. 231 6,038
CompuCredit Corp.* 251 3,050
Connecticut Bancshares Inc. 207 8,125
Cons Tomoka Land Co-Florida 106 2,663
Cooper Cos. 1,331 18,581
Cornerstone Realty Income Trust Inc. 1,028 7,515
Corporate Office Properties Trust 547 9,261
Correctional Properties Trust 136 3,808
Corus Bankshares Inc. 145 7,022
Credit Acceptance Corp.* 243 2,452
Criimi Mae Inc* 233 2,551
Crown American Realty Trust 492 5,284
CVB Financial Corp. 620 12,102
Delphi Financial Group Inc. 308 14,414
Dime Community Bancshares 382 9,722
Donegal Group Inc- 61 811
DVI Inc.* 245 1,144
East West Bancorp Inc. 426 15,396
Eastern Virginia Bankshares 91 2,088
<Caption>
SHARES VALUE
FINANCIAL - 17.91% (CONTINUED)
EastGroup Properties Inc. 288 $ 7,776
EMC Insurance Group Inc. 43 798
Enstar Group Inc* 57 2,246
Entertainment Properties Trust 325 9,344
Equity Inns Inc. 763 5,265
Equity One Inc. 517 8,479
Esb Financial Corp 135 1,823
Essex Property Trust Inc. 312 17,862
Evertrust Financial Group Inc 79 1,816
Exchange National Bancshares Inc 52 2,910
F&M Bancorp 203 10,012
Farmers Capital Bank Corp. 113 3,608
FBL Financial Group Inc. 220 4,433
Federal Agricultural Mortgage Corp.* 147 3,285
FelCor Lodging Trust Inc. 920 7,222
Fflc Bancorp Inc 77 2,000
Fidelity Bankshares Inc. 249 5,553
Financial Federal Corp.* 274 6,686
Financial Industries Corp. 149 2,196
Financial Institutions Inc. 157 3,690
First Albany Companies Inc 132 1,641
First Bancorp 140 3,627
First Bell Bancorp Inc 59 1,514
First Busey Corp. 166 4,024
First Charter Corp. 560 9,744
First Citizens Banc Corp 79 2,050
First Citizens Bancshares Inc. 115 11,597
First Commonwealth Financial Corp. 1,110 14,386
First Community Bancorp Inc. 232 7,231
First Community Bancshares, Inc. 164 5,789
First Defiance Financial Corp. 93 1,845
First Essex Bancorp Inc. 126 5,940
First Federal Financial Of Kentucky 60 1,948
First Federal Capital Corp. 321 6,372
First Financial Bancorp 609 9,744
First Financial Bankshares Inc. 256 8,566
First Financial Corp. 128 6,771
First Financial Holdings Inc. 238 6,436
First Indiana Corp. 218 3,732
First Industrial Realty Trust Inc 738 23,321
First M & F Corp 64 2,093
First Merchants Corp. 330 8,022
First National Corp. 144 3,551
First Oak Brook Bancshares Inc. 81 2,672
First Place Financial Corp. 223 3,862
First Republic Bank* 196 5,214
First Sentinel Bancorp Inc. 416 6,644
First South Bancorp Inc. 58 1,929
First State Bancorp 140 3,851
First United Corp 115 2,705
Firstbank Corp 102 3,090
FirstFed America Bancorp, Inc. 138 4,761
FirstFed Financial Corp.* 319 11,258
Flag Financial Corp 124 1,700
Flagstar Bancorp Inc. 550 13,448
Floridafirst Bancorp 101 2,424
Flushing Financial Corp. 178 3,946
Fms Financial Corp 71 1,341
FNB Corp - North Carolina 93 2,308
FNB Corp. - Virginia 109 2,951
Foothill Independent Bancorp 86 1,602
Franklin Financial Corp. 62 1,863
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
49
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
FINANCIAL - 17.91% (CONTINUED)
Fremont General Corp. 1,146 $ 15,700
Frontier Financial Corporation 289 8,210
Ga Financial Inc 79 1,987
Gabelli Asset Management Inc.* 123 4,440
Gables Residential Trust 462 13,966
GATX Corp. 785 12,835
Gb&T Bancshares Inc 84 2,064
GBC Bancorp Inc. 145 5,568
German American Bancorp 166 2,897
Getty Realty Corp. 293 6,540
Glacier Bancorp Inc. 336 8,272
Gladstone Capital Corp. 165 3,404
Glenborough Realty Trust Inc. 326 6,243
Glimcher Realty Trust 579 12,970
Gold Banc Corp. 663 6,968
Great American Financial Resources
Inc. 126 1,652
Great Lakes REIT Inc. 267 4,272
Great Southern Bancorp Inc. 107 4,124
Greater Bay Bancorp 977 19,950
Greater Community Bancorp 95 1,446
Greene County Bancshares Inc 110 2,327
Hancock Holding Co. 252 11,859
Hanmi Financial Corp. 174 3,040
Harbor Florida Bancshares Inc. 394 9,440
Harleysville Group Inc. 567 13,052
Harleysville National Corp. 358 9,687
Hawthorne Financial Corp.* 145 5,026
Health Care REIT Inc. 759 23,150
Heartland Financial USA Inc 117 3,744
Heritage Commerce Corp* 211 2,572
Heritage Financial Corp 101 2,163
Heritage Property Investment Trust
Inc. 348 9,424
Highwoods Properties Inc 1,006 22,434
Hilb, Rogal & Hamilton Co. 565 19,233
Home Properties of New York Inc. 524 18,466
Horace Mann Educators Corp. 736 11,872
Horizon Financial Corp 200 3,154
Hudson River Bancorp Inc. 285 7,957
Humboldt Bancorp 233 3,486
IBERIABANK Corp. 126 6,149
IBT Bancorp Inc 49 2,450
IMPAC Mortgage Holdings Inc. 926 15,455
Independence Holding Co. 61 1,288
Independent Bank Corp. 221 4,992
Independent Bank Corp. - Michigan 339 8,709
Infinity Property & Casualty 233 5,508
Innkeepers USA Trust 505 3,434
Insignia Financial Group Inc.* 375 4,166
Integra Bank Corp. 288 4,956
Interchange Financial Services Corp. 210 4,120
Investment Technology Group* 889 16,535
Investors Real Estate Trust 675 7,283
Irwin Financial Corp. 293 7,589
ITLA Capital Corp.* 88 3,558
Jones Lang LaSalle Inc.* 584 9,227
Kansas City Life Insurance Co. 69 2,956
Keystone Property Trust Corp. 341 6,312
Kilroy Realty Corp. 455 12,513
Klamath First Bancorp Inc 115 1,934
Knight Trading Group Inc.* 1,365 8,490
Koger Equity Inc. 356 6,134
Kramont Realty Trust 400 6,600
<Caption>
SHARES VALUE
FINANCIAL - 17.91% (CONTINUED)
L N B Bancorp Inc 88 $ 1,881
Lakeland Bancorp Inc. 215 3,436
Lakeland Financial Corp. 97 2,947
LandAmerica Financial Group Inc. 349 16,578
LaSalle Hotel Properties 317 4,685
Lexington Corporate Properties Trust 589 10,425
LNR Property Corp. 373 13,950
Local Financial Corp.* 325 4,693
LSB Bancshares Inc. 160 2,770
LTC Properties Inc. 249 2,378
Macatawa Bank Corp. 157 3,782
MAF Bancorp Inc. 360 13,345
Main Street Banks Inc. 251 6,350
MainSource Financial Group Inc. 112 2,729
Manufactured Home Communities Inc. 263 9,234
Massbank Corp. 70 2,532
MB Financial Inc. 216 8,649
Mbt Financial Corp 301 4,982
MCG Capital Corp. 424 6,148
Medallion Financial Corp 262 1,826
Mercantile Bank Corp 91 2,601
Merchants Bancshares Inc. 76 1,976
MeriStar Hospitality Corp. 791 4,066
Metris Companies Inc. 534 2,964
MFA Mortgage Investments, Inc. 872 8,755
Mid-America Apartment Communities Inc. 288 7,779
Mid-Atlantic Realty Trust 340 7,120
Midland Co. 134 2,976
Mid-State Bancshares 442 8,730
Midwest Banc Holdings Inc. 201 3,903
Mission West Properties 286 3,252
Mutualfirst Financial Inc 83 1,932
Nara Bancorp Inc. 166 3,154
NASB Financial Inc. 58 1,682
National Bankshares Inc 66 2,594
National Health Investors Inc. 417 7,689
National Health Realty Inc. 117 1,871
National Penn Bancshares Inc. 390 10,951
National Western Life Insurance Co.* 41 4,528
Nationwide Health Properties Inc. 1,106 17,619
Navigators Group Inc.* 78 2,326
NBC Capital Corp. 126 3,188
NBT Bancorp Inc. 610 11,804
New Century Financial Corp. 355 15,496
Newcastle Investment Corp 386 7,558
Northern States Financial Corp 55 1,579
Northwest Bancorp Inc. 207 3,312
NovaStar Financial Inc. 187 11,173
NYMAGIC INC. 41 831
Oak Hill Financial Inc 62 1,552
OceanFirst Financial Corp. 118 2,883
Ocwen Financial Corp.* 735 3,337
Ohio Casualty Corp.* 1,044 13,760
Old Point Financial Corp 43 1,260
Old Second Bancorp Inc. 140 5,999
Omega Financial Corp. 153 5,233
Omega Healthcare Investors Inc.* 297 1,559
Oneida Financial Corp 32 733
Oriental Financial Group Inc. 244 6,268
Pab Bankshares Inc 133 1,728
Pacific Capital Bancorp 647 22,677
Pacific Northwest Bancorp 318 11,054
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
50
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
FINANCIAL - 17.91% (CONTINUED)
Pacific Union Bank 75 $ 1,004
ParkerVision Inc. 202 992
Parkvale Financial Corp. 79 1,942
Parkway Properties Inc. 176 7,401
Partners Trust Financial Group Inc. 124 2,366
Patriot Bank Corp 126 2,282
Peapack-Gladstone Financial Corp. 115 3,683
Penn-America Group Inc 173 1,946
Pennfed Financial Services Inc. 71 1,970
Pennrock Financial Savings Corp. 130 3,511
Penns Woods Bancorp Inc 57 2,400
Pennsylvania Real Estate Investment
Trust 275 8,236
Peoples Bancorp Inc. 180 4,549
Peoples Holding Co. 105 4,646
PFF Bancorp Inc. 169 6,532
Philadelphia Consolidated Holding Co.* 293 11,837
Phoenix Companies Inc 1,771 15,992
PMA Capital Corp. 403 5,066
Port Financial Corp. 88 4,741
Portfolio Recovery Associate* 207 6,456
Post Properties Inc. 594 15,741
Prentiss Properties Trust 585 17,544
Presidential Life Corp. 388 5,475
Price Legacy Corp.* 384 1,440
PrivateBancorp Inc. 104 2,836
ProAssurance Corp.* 446 12,038
Prosperity Bancshares Inc. 241 4,639
Provident Bancorp Inc. 67 2,151
Provident Bankshares Corp. 432 10,977
Provident Financial Holdings 65 1,907
Provident Financial Services 892 16,993
PS Business Parks Inc. 242 8,543
Quaker City Bancorp Inc.* 96 3,941
RAIT Investment Trust 372 9,858
R&G Financial Corp 345 10,247
Ramco-Gershenson Properties Trust 201 4,683
Reading International Inc* 260 1,443
Reckson Assoc Realty Corp 944 19,692
Redwood Trust Inc. 238 9,499
Republic Bancorp Inc. 968 12,991
Republic Bancorp Inc. - Class A 135 2,002
Republic Bancshares Inc. 140 3,501
Resource Bankshares Corp 56 1,904
RFS Hotel Investors Inc. 555 6,838
Riggs National Corp. 294 4,475
RLI Corp. 341 11,219
Royal Bancshares of Pennsylvania 81 1,729
S&T Bancorp Inc. 495 13,578
S.Y. Bancorp Inc. 99 3,502
Safety Insurance Group Inc 178 2,618
Sanders Morris Harris Group Inc 199 1,781
Sandy Spring Bancorp Inc. 273 8,627
Santander Bancorp 91 1,489
Saul Centers Inc. 206 5,274
Saxon Capital Inc.* 510 8,864
Seacoast Banking Corp. of Florida 195 3,323
Seacoast Financial Services Corp. 435 8,613
Second Bancorp Inc. 153 3,947
Security Bank Corp 71 2,459
Selective Insurance Group Inc. 506 12,675
Senior Housing Properties Trust 855 11,594
Shore Bancshares Inc 101 3,106
<Caption>
SHARES VALUE
FINANCIAL - 17.91% (CONTINUED)
Sierra Bancorp 95 $ 1,335
Silicon Valley Bancshares* 624 14,857
Simmons First National Corp. 266 5,323
Sizeler Property Investors Inc. 217 2,224
SL Green Realty Corp. 515 17,968
Sound Federal Bancorp Inc 249 3,384
Soundview Technology Group* 1 10
South Financial Group Inc. 878 20,484
Southern Financial Bncrp 103 3,148
Southside Bancshares Inc 158 2,835
Southwest Bancorp Inc. 100 2,741
Southwest Bancorp of Texas Inc.* 532 17,295
Sovran Self Storage Inc. 245 7,718
St. Francis Capital Corp. 136 3,954
State Auto Financial Corp. 242 5,433
State Bancorp Inc. 127 2,485
State Financial Services Corp 96 2,125
Staten Island Bancorp Inc. 998 19,441
Sterling Bancorp 195 5,439
Sterling Bancshares Inc. 745 9,745
Sterling Financial Corp. 319 7,417
Sterling Financial Corp. - Spokane* 278 6,772
Stewart Information Services Corp.* 315 8,773
Suffolk Bancorp 208 6,698
Summit Bancshares Inc. 98 2,301
Summit Properties Inc. 443 9,148
Sun Bancorp Inc. 102 2,058
Sun Bancorp Inc. - New Jersey* 121 2,408
Sun Communities Inc. 258 10,139
Superior Financial Corporation 113 2,712
Susquehanna Bancshares Inc. 747 17,442
SWS Group Inc. 263 5,299
Tanger Factory Outlet Centers Inc. 122 4,036
Tarragon Realty Investors* 103 1,502
Taubman Centers Inc. 827 15,845
Taylor Capital Group Inc 71 1,480
Texas Regional Bancshares Inc. 441 15,303
The First of Long Island Corporation 64 2,564
Tierone Corp* 425 8,275
Tompkins Trustco Inc. 139 6,206
Town & Country Trust 270 6,278
Trammell Crow Co.* 580 6,154
Transcontinental Realty Investors* 31 456
Triad Guaranty Inc.* 143 5,427
TriCo Bancshares 99 2,518
Troy Financial Corp. 123 3,339
Trust Company of New Jersey 349 10,575
TrustCo Bank Corp. 1,402 15,534
U.S. Restaurant Properties Inc. 374 5,872
U.S.B. Holding Co. Inc. 223 3,958
UCBH Holdings Inc. 740 21,223
UICI* 703 10,594
UMB Financial Corp. 308 13,059
Umpqua Holdings Corp. 531 10,084
Union Bankshares Corp. 143 4,043
United Capital Corporation 26 905
United Community Banks Inc. 343 8,568
United Community Financial Corp. 569 5,258
United Fire & Casualty Co. 135 4,386
United Mobile Homes Inc 105 1,592
United National Bancorp 356 9,822
United Panam Financial Corp* 74 906
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
51
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
FINANCIAL - 17.91% (CONTINUED)
United Security Bancshares 61 $ 2,771
United Security Bancshares -
California 64 1,391
Universal American Financial Corp.* 443 2,822
Universal Health Realty Income Trust 206 5,562
Unizan Financial Corp. 407 7,151
Urstadt Biddle Prop Inc A 393 5,054
Usi Holdings Corp* 421 4,951
Ventas Inc. 1,395 21,121
Virginia Commerce Bancorp* 90 1,736
Virginia Financial Group Inc. 135 3,780
W Holding Co. Inc. 854 14,450
Warwick Community Bancorp Inc. 55 1,609
Washington Real Estate Investment
Trust 685 18,632
Washington Trust Bancorp Inc. 246 5,656
Wayne Bancorp 89 2,714
Waypoint Financial Corp. 547 9,868
Wesbanco Inc. 338 8,213
West Bancorporation 302 5,403
West Coast Bancorp 286 5,205
West Essex Bancorp Inc"+" 37 1,299
Westcorp Inc. 218 6,104
Western Sierra Bancorp* 63 2,096
Westfield Financial Inc. 90 1,693
WFS Financial Inc.* 228 7,640
Willow Grove Bancorp Inc. 209 3,547
Winston Hotels Inc. 323 2,639
Wintrust Financial Corp. 327 9,679
World Acceptance Corp.* 281 4,575
WSFS Financial Corp. 110 4,224
Yardville National Bancorp 156 3,042
Zenith National Insurance Corp. 166 4,731
--------------
2,929,967
--------------
INDUSTRIAL - 10.60%
A.O. Smith Corp. 313 8,811
AAON Inc.* 171 3,167
AAR Corp.* 599 4,229
Actuant Corp.* 199 9,417
Acuity Brands Inc. 781 14,191
Advanced Energy Industries Inc.* 315 4,489
Airborne Inc. 912 19,061
Alamo Group Inc. 101 1,234
Albany International Corp. 500 13,700
Alexander & Baldwin Inc. 779 20,667
Ameron International Corp. 125 4,346
Ampco-Pittsburgh Corp 88 1,099
AMR Corp. 2,943 32,373
Analogic Corp. 148 7,216
Apogee Enterprises Inc. 420 3,788
Applied Films Corp.* 209 5,409
Applied Industrial Technologies Inc. 320 6,752
Arkansas Best Corp. 409 9,730
Armor Holdings Inc.* 383 5,132
Artesyn Technologies Inc.* 594 3,332
Astec Industries Inc.* 279 2,433
Baldor Electric Co. 551 11,351
Barnes Group Inc. 231 5,027
BEI Technologies Inc. 207 2,484
Bel Fuse Inc. 184 4,214
Belden Inc. 422 6,706
Benchmark Electronics Inc.* 464 14,273
BHA Group Holdings Inc 74 1,477
<Caption>
SHARES VALUE
INDUSTRIAL - 10.60% (CONTINUED)
Blount International Inc* 78 $ 445
Brady Corp. 334 11,139
Briggs & Stratton Corp. 407 20,554
C&D Technologies Inc. 384 5,514
Calgon Carbon Corp. 641 3,686
Cascade Corp. 193 3,358
Casella Waste Systems Inc.* 239 2,158
Centex Construction Products Inc. 123 4,931
Ceradyne Inc* 133 2,491
Checkpoint Systems Inc.* 616 8,716
Chesapeake Corp. 269 5,878
Circor International Inc. 232 4,137
CLARCOR Inc. 469 18,080
Clean Harbors Inc* 147 1,401
CoBiz Inc. 286 9,939
Cognex Corp.* 638 14,259
Coherent Inc.* 552 13,209
Commercial Metals Co. 473 8,415
Concord Camera Corp.* 457 3,240
Copart Inc.* 1,279 12,087
Covenant Transport Inc.* 138 2,346
CTS Corp. 643 6,719
Cubic Corp. 291 6,466
Cuno Inc.* 279 10,077
Curtiss-Wright Corp. 155 9,796
Cymer Inc* 650 20,514
Daktronics Inc.* 267 4,365
Darling International Inc* 1,051 2,060
Dionex Corp.* 313 12,442
Drew Industries Inc.* 116 2,111
DRS Technologies Inc.* 422 11,782
Ducommun Inc.* 125 1,763
Duratek Inc* 144 1,142
Dycom Industries Inc.* 901 14,686
EDO Corp. 291 5,151
EGL Inc.* 593 9,014
Electro Scientific Industries Inc. 524 7,944
ElkCorp 367 8,258
EMCOR Group Inc.* 246 12,143
Encore Wire Corp.* 195 1,853
Energy Conversion Devices Inc.* 317 2,885
Engineered Support Systems Inc. 217 9,081
Enpro Industries Inc* 384 4,105
ESCO Technologies Inc.* 226 9,944
Esterline Technologies Corp.* 392 6,825
Excel Technology Inc.* 172 3,927
Fairchild Corp (The)* 211 749
Fargo Electronics* 216 2,102
Federal Signal Corp. 903 15,866
FEI Company* 460 8,630
Flir Systems Inc.* 620 18,693
Florida East Coast Industries Inc. 275 7,026
Flowserve Corporation* 884 17,388
Forward Air Corp.* 205 5,201
Fossil Inc.* 229 4,711
Franklin Electric Co. Inc. 125 6,956
Gardner Denver Inc.* 302 6,179
GenCorp Inc. 590 5,245
General Cable Corp.* 624 3,370
Genlyte Group Inc.* 226 7,903
Gerber Scientific Inc* 393 2,617
Global Power Equipment Group Inc.* 462 2,148
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
52
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
INDUSTRIAL - 10.60% (CONTINUED)
Gorman-Rupp Co. 138 $ 3,312
GrafTech International Ltd.* 1,010 5,505
Granite Construction Inc. 616 11,803
Graphic Packaging International Corp.* 420 1,894
Greenbrier Companies Inc* 101 1,096
Griffon Corp.* 510 8,160
GulfMark Offshore Inc.* 255 4,304
Gundle SLT Environmental Inc* 101 1,376
Heartland Express Inc.* 569 12,660
Heico Corp. 247 3,013
Herley Industries Inc.* 204 3,464
Hexcel Corp.* 418 1,338
Identix Inc.* 1,608 10,211
IDEX Corp. 519 18,809
II-VI Inc.* 206 4,754
Immucor Inc. 242 5,566
Innovex Inc* 286 2,889
Integrated Defense Technologies Inc.* 180 2,792
Intermagnetics General Corp.* 310 6,150
Interpool Inc. 127 2,085
Invision Technologies Inc.* 323 8,027
Ionics Inc.* 330 7,382
Itron Inc.* 383 8,257
Jacuzzi Brands Inc* 1,410 7,459
JLG Industries Inc. 809 5,501
Joy Global Inc.* 901 13,308
Kadant Inc.* 224 4,200
Kaman Corp. 412 4,816
Kansas City Southern* 1,160 13,955
Kaydon Corp. 523 10,878
Keithley Instruments Inc. 230 3,324
Kennametal Inc. 626 21,184
Kirby Corp.* 347 9,785
Knight Transportation Inc.* 457 11,379
Landstar System Inc.* 277 17,409
Lawson Products Inc. 91 2,506
Lennox International Inc. 825 10,618
Lincoln Electric Holdings Inc. 606 12,368
Lindsay Manufacturing Co. 221 5,132
Littelfuse Inc.* 361 8,072
LSI Industries Inc. 269 2,986
Lydall Inc.* 275 2,943
Manitowoc Co. 497 11,083
Manufacturers Services Ltd.* 305 1,479
Maritrans Inc 130 1,944
Matthews International Corp. 536 13,271
Medis Technologies Ltd.* 222 1,583
Mestek Inc.* 57 1,026
Methode Electronics Inc. 627 6,740
Metrologic Instruments Inc* 37 1,331
Milacron Inc. 636 3,110
Mine Safety Appliances Co. 119 5,191
Molecular Devices Corp.* 259 4,121
Mtc Technologies Inc* 108 2,534
Mueller Industries Inc.* 645 17,486
Myers Industries Inc. 361 3,430
NACCO Industries Inc. 87 5,128
NCI Building Systems Inc.* 352 5,878
NN Inc. 201 2,545
Nordson Corporation 482 11,496
NS Group Inc.* 276 2,691
Offshore Logistics Inc.* 351 7,634
<Caption>
SHARES VALUE
INDUSTRIAL - 10.60% (CONTINUED)
Old Dominion Freight Line* 210 $ 4,540
Orbital Sciences Corp.* 867 6,329
OSI Systems Inc.* 243 3,903
Overseas Shipholding Group Inc. 290 6,383
P.A.M. Transportation Services Inc.* 107 2,688
Pacer International Inc* 420 7,921
Park Electrochemical Corp. 324 6,464
Paxar Corp.* 523 5,753
Pemstar Inc* 468 1,961
Penn Engineering & Manufacturing Corp. 193 2,634
Perini Corp* 308 1,238
Petroleum Helicopters Inc.* 69 2,177
Pharmacopeia Inc.* 424 7,496
Photon Dynamics Inc.* 301 8,317
Planar Systems Inc.* 264 5,164
Powell Industries Inc.* 123 1,801
Power-One Inc.* 1,193 8,530
Presstek Inc.* 575 3,582
Prime Hospitality Corp.* 3,103 22,146
Quanex Corp. 305 9,065
Quixote Corp. 118 3,013
RailAmerica Inc.* 556 4,698
Raven Industries Inc 124 2,489
Rayovac Corp.* 611 7,912
Regal-Beloit Corp. 442 8,442
Research Frontiers Inc.* 188 2,632
Roadway Corp. 218 6,220
Robbins & Myers Inc. 203 3,756
Rofin-Sinar Technologies Inc* 218 3,080
Rogers Corp.* 300 9,990
Roper Industries Inc. 515 19,158
Saflink Corp* 487 3,088
Sauer-Danfoss Inc. 189 2,032
SBS Technologies Inc.* 275 2,704
SCS Transportation, Inc.* 261 3,296
Seabulk International Inc* 220 1,951
Sequa Corp. 67 2,298
Shaw Group Inc* 710 8,556
Silgan Holdings Inc.* 204 6,381
Simpson Manufacturing Co.* 279 10,211
Sonic Solutions* 225 1,940
SPS Technologies Inc.* 154 4,164
Standex International Corp. 206 4,326
Stewart & Stevenson Services Inc. 536 8,442
Stoneridge Inc.* 239 3,262
Sturm Ruger & Co. 400 4,000
Superconductor Technologies* 930 2,074
SureBeam Corp.* 1,419 3,760
Sypris Solutions Inc. 101 1,043
Technitrol Inc.* 756 11,378
Tecumseh Products Co. 304 11,646
Teledyne Technologies Inc.* 605 7,926
Tennant Co. 160 5,880
Terex Corp.* 823 16,065
Tetra Tech Inc.* 943 16,154
Texas Industries Inc. 396 9,425
The Brink's Company 1,021 14,876
Thomas & Betts Corp.* 803 11,603
Thomas Industries Inc. 179 4,842
TRC Cos. Inc.* 221 3,262
Tredegar Corp. 576 8,634
Trex Co. Inc.* 140 5,495
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
53
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
INDUSTRIAL - 10.60% (CONTINUED)
Trimble Navigation Ltd.* 596 $ 13,666
Trinity Industries Inc. 662 12,254
Triumph Group Inc.* 269 7,578
TTM Technologies Inc.* 362 1,698
U.S. Xpress Enterprises Inc.* 106 1,130
United Industrial Corp. 193 3,146
United Rentals* 1,000 13,890
Universal Display Corp.* 274 2,444
Universal Forest Products Inc. 292 6,114
UNOVA Inc.* 866 9,613
URS Corp.* 301 5,857
USFreightways Corp. 508 13,701
USG Corp.* 688 13,072
Valence Technology Inc* 931 2,784
Valmont Industries Inc. 276 5,371
Varian Inc.* 551 19,103
Veridian Corp* 418 14,584
Vicor Corp.* 361 3,466
Wabtec 595 8,276
Washington Group International Inc* 470 10,321
Waste Connections Inc.* 531 18,612
Watts Industries Inc. 210 3,749
Wilson Greatbatch Technologies Inc.* 374 13,501
Woodhead Industries Inc. 184 2,304
Woodward Governor Co. 167 7,181
X-Rite Inc. 381 3,776
Yellow Corp.* 559 12,941
York International 746 17,456
Zygo Corp.* 297 2,376
--------------
1,734,459
--------------
TECHNOLOGY - 9.43%
Actel Corp.* 413 8,467
Activcard Corp* 660 6,204
Activision, Inc.* 1,653 21,357
Advanced Digital Information Corp.* 1,165 11,638
Advent Software, Inc.* 602 10,180
Alliance Semiconductor Corp.* 409 1,980
Allscripts Healthcare Solutions Inc.* 454 1,666
Altiris Inc.* 160 3,208
American Management Systems Inc.* 794 11,338
Andrew Corp.* 1,850 17,020
Ansoft Corp* 122 1,287
Ansys Inc.* 279 8,677
Anteon International Corp.* 350 9,769
Artisan Components Inc.* 313 7,077
Ascential Software Corp* 1,091 17,936
Aspen Technology Inc.* 661 3,173
Asyst Technologies Inc.* 726 4,857
Atari Inc* 132 587
Atlantic Coast Airlines Holdings Inc.* 540 18,522
ATMI Inc.* 504 12,585
Avid Technology Inc.* 533 18,692
Axcelis Technologies Inc.* 1,851 11,328
Barra Inc.* 280 9,996
Borland Software Corp.* 1,331 13,004
Catapult Communications Corp.* 105 1,115
CCC Information Services Group Inc.* 233 3,379
Cerner Corp* 532 12,209
ChipPAC Inc.* 898 6,888
CIBER Inc.* 951 6,676
Cirrus Logic Inc.* 1,303 5,238
<Caption>
SHARES VALUE
TECHNOLOGY - 9.43% (CONTINUED)
Cohu Inc. 394 $ 6,146
CompuCom Systems Inc.* 447 2,020
Computer Horizons Corp.* 570 2,588
Computer Programs and Systems Inc.* 117 2,341
Concord Communications Inc.* 307 4,215
Concur Technologies Inc* 431 4,340
Concurrent Computer Corp.* 1,168 3,411
Conexant Systems, Inc. 5,039 20,660
Convera Corporation* 209 819
CRAY Inc.* 1,230 9,717
Credence Systems Corp.* 1,187 10,054
CSG Systems International* 984 13,904
Cyberguard Corp 192 1,363
Datastream Systems Inc.* 325 3,442
Dendrite International Inc.* 559 7,200
Digimarc Corp.* 175 2,748
Diodes Inc* 78 1,494
Documentum Inc.* 828 16,287
Dot Hill Systems Corp* 502 6,576
Drexler Technology Corp.* 168 2,604
DSP Group Inc.* 516 11,109
DuPont Photomasks Inc.* 224 4,218
Echelon Corp.* 532 7,326
Eclipsys Corp.* 654 6,828
eFunds Corp.* 880 10,146
Electronics for Imaging Inc.* 873 17,713
Embarcadero Technologies Inc.* 260 1,820
Entegris Inc.* 993 13,346
Epicor Software Corp* 712 4,265
EPIQ Systems Inc.* 240 4,121
ESS Technology Inc.* 574 5,597
Exar Corp.* 753 11,920
FalconStor Software Inc.* 639 4,275
Fidelity National Information
Solutions Inc.* 239 6,233
FileNet Corp.* 640 11,546
Gateway Inc.* 4,079 14,888
General Binding Corp.* 114 1,368
Genesis Microchip Inc.* 587 7,948
Global Imaging Systems Inc.* 279 6,462
GlobespanVirata Inc.* 1,986 16,385
Group 1 Software Inc* 169 3,121
Handspring Inc.* 1,074 1,214
Helix Technology Corp. 491 6,496
Hutchinson Technology Inc.* 430 14,143
Hyperion Solutions Corp.* 686 23,159
IDX Systems Corp.* 325 5,044
iGATE Corp.* 381 1,322
Imagistics International Inc.* 291 7,508
Impac Medical Systems Inc* 116 2,422
InFocus Corp.* 701 3,309
Informatica Corp.* 1,204 8,320
InfoUSA Inc.* 556 4,504
Integral Systems Inc.* 183 3,638
Integrated Silicon Solution Inc.* 523 3,630
Intelidata Technologies Corp* 921 2,781
InterCept Inc.* 337 2,817
Intergraph Corp.* 867 18,641
Inter-Tel Inc. 350 7,427
Intervoice Inc* 642 3,069
Iomega Corp.* 966 10,240
IXYS Corp.* 324 2,582
JDA Software Group Inc.* 536 5,998
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
54
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
TECHNOLOGY - 9.43% (CONTINUED)
Keane Inc.* 972 $ 13,248
KEMET Corp.* 1,622 16,382
Komag Inc* 443 5,241
Kopin Corp.* 1,306 7,993
Kronos Inc.* 373 18,952
Kulicke & Soffa Industries Inc.* 936 5,981
Lattice Semiconductor Corp.* 1,903 15,662
Lawson Software Inc.* 797 6,193
Legato Systems Inc.* 1,626 13,642
Lexar Media Inc.* 1,003 9,569
LTX Corp.* 932 8,034
Magma Design Automation Inc.* 394 6,757
Manhattan Associates Inc.* 410 10,648
ManTech International Corp.* 249 4,776
Manugistics Group Inc.* 1,141 4,690
MAPICS Inc.* 330 2,706
Mattson Technology Inc.* 524 1,619
Mentor Graphics Corp.* 1,268 18,361
Mercury Computer Systems Inc.* 398 7,228
Micrel Inc.* 1,054 10,951
Micromuse Inc.* 1,029 8,222
Micros Systems Inc.* 310 10,224
Microsemi Corp.* 545 8,720
Microstrategy Inc* 179 6,521
Microtune Inc.* 714 2,285
Midway Games Inc.* 488 1,771
Mks Instruments Inc* 492 8,890
Mobius Management Systems* 136 1,016
Monolithic System Technology Inc.* 424 3,841
MRO Software Inc.* 361 3,115
MSC.Software Corp.* 451 3,040
Mykrolis Corp.* 609 6,181
Nassda Corp.* 254 1,961
National Western Life Insurance Co.* 547 8,900
NDCHealth Corp. 655 12,019
Neoware Systems Inc* 262 4,019
NetIQ Corp.* 1,004 15,522
NetScout Systems Inc.* 362 1,944
Nuance Communications Inc.* 105 567
NYFIX Inc.* 492 3,124
Oak Technology Inc.* 1,059 6,576
Omnicell Inc.* 272 2,785
OmniVision Technologies Inc.* 387 12,074
ON Semiconductor Corp.* 525 1,418
OPNET Technologies Inc.* 206 2,511
Overland Storage Inc.* 156 3,173
Packeteer Inc.* 435 6,773
Parametric Technology Corp.* 4,025 12,276
Parthusceva Inc* 286 2,339
Patina Oil & Gas Corp. 394 5,808
PDF Solutions Inc.* 272 3,142
PEC Solutions Inc.* 161 2,592
Pegasystems Inc.* 181 1,334
Pericom Semiconductor Corp.* 392 3,646
Perot Systems Corp* 1,378 15,654
Per-Se Technologies Inc.* 505 5,671
Photronics Inc.* 537 9,371
Pinnacle Systems Inc.* 1,085 11,610
Pioneer-Standard Electronics Inc. 527 4,469
Pixelworks Inc.* 648 3,849
Pomeroy Computer Resources Inc.* 181 2,002
Power Integrations Inc.* 483 11,747
<Caption>
SHARES VALUE
TECHNOLOGY - 9.43% (CONTINUED)
Progress Software Corp.* 492 $ 10,199
Pumatech Inc* 698 2,373
QAD Inc* 192 1,428
Quality Systems Inc* 62 1,704
Quantum Corp.* 2,658 10,765
Quest Software Inc.* 739 8,794
Radiant Systems Inc.* 317 2,137
Radisys Corp.* 334 4,409
Rainbow Technologies Inc.* 448 3,768
Redback Networks Inc.* 2,873 2,586
Renaissance Learning Inc.* 144 3,154
Retek Inc.* 1,013 6,483
RF Micro Devices, Inc.* 3,234 19,469
Richardson Electronics Ltd. 117 948
Roxio Inc.* 368 2,462
Rudolph Technologies Inc.* 220 3,511
Sanchez Computer Associates Inc.* 260 1,352
ScanSoft Inc.* 955 5,186
Schawk Inc. 142 1,488
SeaChange International Inc.* 447 4,264
Semitool Inc.* 305 1,504
Semtech Corp* 1,105 15,735
SERENA Software Inc.* 428 8,937
Sigma Designs Inc* 301 3,010
Silicon Graphics Inc.* 3,845 4,383
Silicon Image Inc.* 1,306 7,287
Silicon Storage Technology Inc.* 1,496 6,268
Siliconix Inc.* 110 3,971
SimpleTech Inc.* 144 577
Sipex Corp.* 466 2,283
Skyworks Solutions Inc.* 2,609 17,663
SpeechWorks International Inc.* 511 2,402
SPSS Inc.* 231 3,867
SRA International Inc.* 160 5,120
SS&C Technologies Inc.* 138 2,201
Standard Microsystems Corp.* 226 3,428
State Bancorp Inc.* 335 6,466
StorageNetworks Inc.* 1,870 2,599
Stratasys Inc* 87 3,060
Supertex Inc.* 166 3,049
Sybase Inc.* 1,640 22,812
Sykes Enterprises Inc.* 449 2,196
Synaptics Inc.* 307 4,132
Synplicity Inc.* 226 1,182
Syntel Inc.* 120 1,888
Systems & Computer Technology Corp.* 633 5,697
Take-Two Interactive Software Inc.* 727 20,603
TALX Corp. 255 5,760
THQ Inc.* 715 12,870
Three-Five Systems Inc.* 401 2,767
Tier Technologies Inc.* 263 2,038
Titan Corp.* 1,494 15,373
Tradestation Group Inc* 326 3,345
Transaction Systems* 634 5,681
Transmeta Corp.* 2,145 3,432
Triquint Semiconductor Inc.* 2,506 10,425
Turnstone Systems Inc.* 694 7,870
Tyler Technologies Inc.* 758 3,222
Ulticom Inc.* 204 1,938
Ultratech Stepper Inc.* 379 7,008
Varian Semiconductor Equipment
Associates Inc.* 535 15,922
Vastera Inc.* 504 3,009
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
55
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
TECHNOLOGY - 9.43% (CONTINUED)
Veeco Instruments Inc.* 429 $ 7,306
Verint Systems Inc.* 117 2,973
Virage Logic Corp.* 237 1,716
VitalWorks Inc.* 704 2,781
Vitesse Semiconductor Corp.* 3,868 19,023
White Electronic Designs Corp.* 347 3,675
Wind River Systems Inc.* 1,295 4,934
Xicor Inc.* 471 2,953
Zoran Corp.* 517 9,932
--------------
1,542,969
--------------
UTILITIES - 2.55%
Allegheny Energy 2,382 20,128
American States Water Co. 286 7,808
Aquila, Inc. 3,460 8,927
Atmos Energy Corp. 939 23,287
Avista Corp. 907 12,834
Black Hills Corp. 603 18,512
California Water Service Group 265 7,452
Cascade Natural Gas Corp. 208 3,973
Central Vermont Public Service Corp. 223 4,360
CH Energy Group Inc. (Holding Co.) 271 12,195
Chesapeake Utilities Corp 105 2,051
CLECO Corp. 831 14,393
CMS Energy 2,551 20,663
Connecticut Water Service Inc. 150 3,833
El Paso Electric Co.* 924 11,393
Empire District Electric Co. 427 9,287
Energen Corp. 657 21,878
EnergySouth Inc. 83 2,722
Idaho Power 719 18,874
Laclede Group Inc. 358 9,594
MGE Energy, Inc. 334 10,481
Middlesex Water Co. 147 3,622
New Jersey Resources Corp. 510 18,105
Northwest Natural Gas Co. 483 13,162
NUI Corp. 301 4,672
Otter Tail Corp. 483 13,031
Pico Holdings Inc.* 115 1,495
PNM Resources Inc. 736 19,688
<Caption>
SHARES VALUE
UTILITIES - 2.55% (CONTINUED)
SEMCO Energy Inc. 356 $ 2,072
Sierra Pacific Resources* 2,204 13,092
SJW Corp. 40 3,410
South Jersey Industries Inc. 233 8,586
Southern Union Co.* 995 16,855
Southwest Gas Corp. 573 12,136
Southwest Water Co. 184 2,570
UIL Holdings Corp. 220 8,921
UniSource Energy Corp. 535 10,058
Westar Energy Inc. 1,259 20,433
--------------
416,553
--------------
Total Common Stocks
(cost $14,071,660) 13,424,634
--------------
UNIT INVESTMENT TRUST(3) - 2.97%
iShares Russell 2000 Index Fund* 5,450 486,597
--------------
Total Unit Investment Trust
(cost $420,292) 486,597
--------------
SHORT-TERM INVESTMENTS(3) - 15.78%
NORTHERN TRUST DIVERSIFIED ASSETS
PORTFOLIO(1) - 6.02% 984,496 984,496
--------------
<Caption>
PRINCIPAL VALUE
U.S. TREASURY BILL - 9.76%
(1.140% due 09/18/03) $ 1,600,000 $ 1,596,980
--------------
Total Short-Term Investments
(cost $2,581,476) 2,581,476
--------------
TOTAL INVESTMENTS - 100.81%
(cost $17,073,428)(1) 16,492,707
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(2) - 12.45% 2,037,361
--------------
OTHER ASSETS AND LIABILITIES - (13.26%) (2,170,167)
--------------
TOTAL NET ASSETS - 100.00% $ 16,359,901
==============
</Table>
- -------------
* Non-income producing
+ Illiquid
(1) For federal income tax purposes, cost is $17,328,000 and gross
unrealized appreciation and depreciation of securities as of
June 30, 2003 was $2,642,539 and ($3,477,832), respectively.
(2) This security was purchased with cash collateral held from
securities lending.
(3) Securities and other assets with an aggregate value of
$2,645,560 have been segregated with the custodian or
designated to cover margin requirements for the open
futures contracts as of June 30, 2003:
<Table>
<Caption>
UNREALIZED
APPRECIATION/
TYPE CONTRACTS (DEPRECIATION)
- -------------------------------------------------------------------
Russell 2000 Index (09/03) 11 $(42,825)
Russell 2000 Index Mini (09/03) 4 $ (3,720)
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
56
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
EAFE INTERNATIONAL INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
SHARES VALUE
COMMON STOCKS - 98.93%
AUSTRALIA - 4.02%
Australia & New Zealand Bank Group 5,947 $ 74,228
BHP Billiton Ltd 14,598 84,592
Commonwealth Bank of Australia 4,964 98,381
Foster's Brewing Group Limited 8,084 22,826
National Australia Bank 6,002 134,854
News Corporation Limited 5,819 43,711
News Corporation Limited - Preferred 7,614 46,930
Rio Tinto Limited 1,189 23,294
Telstra Corporation Limited 8,587 25,341
Wesfarmers Limited 1,472 24,978
Westpac Banking Corp 6,915 75,365
Woolworths Limited 4,133 34,705
--------------
689,205
--------------
BELGIUM - 0.70%
Dexia* 2,536 32,064
Electrabel* 82 20,896
Fortis* 3,820 66,328
--------------
119,288
--------------
DENMARK - 0.50%
Danisco A/S* 94 3,683
Danske Bank A/S 2,195 42,746
Group 4 Falck 13 216
Novo-Nordisk A/S 1,084 37,948
TDC A/S 12 359
--------------
84,952
--------------
FINLAND - 2.00%
Fortum Oyj 130 1,042
Instrumentarium Oyj 57 2,167
Kesko Oyj 33 387
Kone Oyj 14 587
Nokia Oyj 18,824 309,986
Tietoenator Oyj 8 135
UMP-Kymmene Oyj 1,910 27,878
--------------
342,182
--------------
FRANCE - 10.37%
Accor SA 610 22,066
Alcatel SA* 4,347 39,187
Aventis SA 2,639 145,193
Axa* 5,530 85,795
BNP Paribas 3,146 159,865
Bouygues 556 15,349
Carrefour Supermarche* 2,286 112,042
Compagnie DE Saint-Gobain* 1,227 48,288
France Telecom* 3,231 79,254
Groupe Danone 444 61,440
Lafarge SA 487 28,522
Lagardere S.C.A. 487 1,314
L'Air liquide 250 37,064
L'OREAL 1,308 92,227
LVMH Moet Hennessy Louis Vuitton 892 44,241
Peugeot SA 605 29,388
Pinault-Printemps-Redoute 136 10,245
Renault SA 490 25,907
<Caption>
SHARES VALUE
FRANCE - 10.37% (CONTINUED)
Sanofi-Synthelabo SA 1,542 $ 90,310
Schneider Electric SA 662 31,123
Societe Generale 1,158 73,406
STMicroelectronics N.V.* 2,324 48,732
Suez Lyonnaise des Eaux 3,275 52,126
Total FinaElf SA* 2,482 375,093
Vivendi Universal* 3,532 64,288
--------------
1,772,465
--------------
GERMANY - 6.81%
Allianz AG 1,110 91,905
BASF AG 2,112 89,859
Bayer AG 2,696 62,230
DaimlerChrysler AG* 3,424 118,747
Deutsche Bank AG 2,237 144,501
Deutsche Post AG 1,532 22,343
Deutsche Telekom* 8,286 126,174
E.ON AG 2,322 119,060
Muenchener Rueckversicherungs AG 275 27,791
RWE AG 1,400 42,283
SAP AG 832 97,455
Schering AG 615 30,016
Siemens AG 3,165 155,015
Volkswagen AG 907 38,121
--------------
1,165,500
--------------
HONG KONG - 1.21%
BOC Hong Kong Holdings Ltd 248 250
Cheung Kong Holdings 6,222 37,261
China Light & Power Holding 7,446 32,369
Hang Seng Bank 2,998 31,621
Henderson Land Development 256 732
Hong Kong & China Gas 17 21
Hong Kong Electric Holdings 5,470 21,394
Hopewell Holdings* 400 426
Hutchison Whampoa 8,618 52,494
Li & Fung Ltd. 1,471 1,896
Kowloon motor Bus Holdings 300 1,400
MTR Corporation 312 358
Sun Hung Kai Properties Ltd 4,823 24,306
Swire Pacific Ltd 16 70
Wharf Holdings Ltd 608 1,170
Yue Yuen Industrial Holdings 300 767
--------------
206,535
--------------
ITALY - 3.96%
Assicurazioni Generali* 4,047 93,786
Banca Intesa SpA* 14,182 45,357
Enel SpA 8,393 52,336
ENI-Ente Nazionale Idrocarburi SpA 11,015 166,591
Mediaset SpA 2,363 19,999
San Paolo-IMI SpA 3,427 31,838
Telecom Italia SpA 9,318 84,320
Telecom Italia SpA-RNC 8,084 44,282
TIM SpA 14,906 73,434
Unicredito Italiano SpA* 13,559 64,619
--------------
676,562
--------------
JAPAN - 15.01%
Aeon Co. Ltd. 800 18,322
Ajinomoto Co Inc 2,200 21,070
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
57
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS EAFE INTERNATIONAL INDEX PORTFOLIO
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
JAPAN - 15.01% (CONTINUED)
Bridgestone Corp 2,000 $ 27,150
Canon Inc 3,000 137,664
Central Japan Railway Co 3 21,487
Chubu Electric Power Co. 2,500 45,597
Dai Nippon Printing Co. Ltd. 2,000 21,153
Denso Corp 1,900 30,112
East Japan Railway Company 11 48,919
Fuji Photo Film Company Ltd. 2,000 57,797
Hitachi Ltd 11,000 46,629
Honda Motor Co Ltd 2,500 94,733
Hoya Corporation 400 27,549
Ito-Yokado Co Ltd 1,000 23,943
JFE Holdings Inc.* 1,800 26,983
Kansai Electric Power Co 2,700 42,588
Kao Corp 2,000 37,227
Keyence Corporation 100 18,322
Kirin Brewery Co. Ltd. 3,000 21,087
Kyocera Corp 600 34,329
Kyushu Electric Power 1,500 23,348
Matsushita Electric Industrial Co Ltd 9,000 89,119
Millea Holdings 3 22,936
Mitsubishi Corp 4,000 27,749
Mitsubishi Estate Co Ltd 4,000 27,083
Mitsubishi Heavy Industries Ltd 11,000 28,491
Mitsubishi Tokyo Financial 10 45,222
Mitsui & Co Ltd 5,000 25,068
Mitsui Sumitomo Insurance Co 5,000 23,194
Murata Manufacturing Co. Ltd 800 31,447
Nintendo Co Ltd* 400 29,082
Nippon Steel Corp 20,000 27,483
Nippon Telegraph & Telephone Corp. 18 70,606
Nissan Motor Co Ltd 8,900 85,090
Nomura Holdings Inc. 7,000 88,845
NTT Mobile Communications 66 142,911
Osaka Gas Co Ltd 8,000 19,788
Pioneer Electric Corp. 93 2,091
Ricom Company Limited 2,000 32,680
Rohm Company Limited 400 43,606
Seven Eleven 1,000 24,901
Sharp Corporation 3,000 38,501
Shimizu Corporation 800 2,219
Shin-Etsu Chemical Co Ltd 1,400 47,803
Sony Corporation 3,500 98,522
Staniley Electric Co Ltd 848 12,084
Sumitomo Mitsui Banking Corp 27 58,913
Takeda Chemical 3,200 118,060
Tohoku Electric Power 1,700 25,144
Tokyo Electric Power Co 4,500 86,009
Tokyo Electron Limited 500 23,694
Tokyo Gas Co Ltd 10,000 28,732
Toshiba Corporation 11,000 37,835
Toyota Motor Corporation 9,200 238,285
Trend Micro 200 3,106
Want Want Holdings Ltd 500 390
Yamanouchi Pharmaceutical Co Ltd 1,300 33,887
--------------
2,566,585
--------------
NETHERLANDS - 6.43%
ABN Amro Holding NV 5,635 107,743
Aegon NV* 5,329 53,363
Akzo Nobel NV 1,079 28,598
<Caption>
SHARES VALUE
NETHERLANDS - 6.43% (CONTINUED)
Heineken NV 628 $ 22,284
ING Groep NV 6,632 115,230
Koninklijke Ahold NV* 6,850 48,535
Nordea AB* 8,830 42,578
Philips Electronics NV 5,196 98,812
Reed Elsevier NV* 2,442 28,800
Royal Dutch Petroleum Company 8,239 382,430
TNT Post Group NV 1,305 22,659
Unilever NV 2,248 120,609
Unv-Ver Ned Uitgev Ver Bezit* 893 27,514
--------------
1,099,155
--------------
NORWAY - 0.18%
Bergesen 6 143
Den Norske Bank 10 49
Norsk Hydro ASA 557 27,393
Norske Skogindustries ASA 99 1,481
Orkla ASA 33 571
Statoil ASA 70 596
--------------
30,233
--------------
PORTUGAL - 0.15%
Portugal Telecom SGPS SA* 3,687 26,420
--------------
SINGAPORE - 0.39%
DBS Group Holdings Ltd 4,409 25,788
Haw Par Corp Ltd 449 1,107
Oversea-Chinese Banking Corp 54 307
Singapore Airlines Ltd.* 163 963
Singapore Press Holdings 558 5,799
Singapore Telecommunications* 444 381
UTD Overseas Bank 4,494 31,644
Venture Corporation Ltd 135 1,234
--------------
67,223
--------------
SPAIN - 4.23%
Altadis SA 1,164 29,835
Banco Bilbao Vizcaya Argentaria SA 11,929 125,345
Banco Santander Central Hispano SA 16,949 148,508
Endesa SA* 3,527 59,053
Iberdrola SA* 2,979 51,589
Repsol YPF SA* 3,615 58,617
Stora Enso OYJ Series R ORDN 2,731 30,515
Telefonica SA* 18,917 219,627
--------------
723,089
--------------
SWEDEN - 2.02%
ABB Ltd* 1,237 4,095
Astrazenca Plc 2,130 86,344
Atlas Copco AB 66 1,670
Electrolux AB 1,280 25,264
Ericsson Lm* 60,418 64,909
Gambro AB 194 1,284
Hennes & Mauritz AB 1,840 42,294
Sandvik AB* 4 105
Skandia Forsakrings AB 385 1,024
SKF AB 16 462
Svenska Cellulosa AB 613 20,944
Svenska Handelsbanken 2,148 35,152
Swisscom 102 28,992
Telia AB 7,516 31,172
</Table>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
58
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
EAFE INTERNATIONAL INDEX PORTFOLIO SCHEDULE OF INVESTMENTS
- ---------------------------------------------------------------------------
<Table>
<Caption>
SHARES VALUE
SWEDEN - 2.02% (CONTINUED)
Volvo AB 52 $ 1,143
--------------
344,854
--------------
SWITZERLAND - 8.99%
CIE Financ Richemont* 2,061 33,323
Credit Suisse Group 4,738 124,703
Nestle SA 1,578 325,619
Novartis 10,750 425,397
Roche Holding AG 2,782 218,226
Swiss Re 1,288 71,365
UBS AG 4,984 277,257
Zurich Financial Services AG* 512 61,047
--------------
1,536,937
--------------
UNITED KINGDOM - 31.96%
3I Group Plc 2,399 22,367
Allied Irish Banks Plc* 3,511 52,778
AstraZeneca Plc 3,693 148,086
Aviva Plc 8,926 61,974
BAA Plc 4,166 33,720
BAE Systems Plc 12,106 28,467
Bank of Ireland* 8,925 107,719
Barclays Plc 25,838 191,866
BG Group Plc 13,873 61,467
Billiton Plc 9,245 48,666
BOC Group Plc* 1,993 25,570
Boots Co. Plc 3,344 35,785
BP Amoco Plc 88,198 611,637
British Airways Plc* 6,456 73,243
British SKY Broadcasting Plc 4,942 54,762
BT Group Plc* 34,133 114,762
Cadbury Schweppes Plc 8,092 47,804
Centrica Plc* 16,775 48,650
Compass Group Plc 8,771 47,292
CRH Plc 2,018 31,633
Diageo Plc* 12,447 132,891
GlaxoSmithKline Plc 25,739 479,089
GUS Plc 3,993 44,740
HBOS Plc 14,908 192,992
HSBC Holdings Plc 42,321 500,030
Imperial Tabacco* 2,907 51,952
Intercontinental Hotel Group* 2,859 20,287
Kingfisher Plc 10,263 46,954
Land Securities Group B 1,826 23,548
Legal & General Group Plc 25,623 35,517
Lloyds TSB Group Plc* 21,968 155,969
Marks & Spencer Plc 8,988 46,831
National Grid Group Plc 12,178 82,593
Pearson Plc 3,133 29,262
Prudential Plc 7,922 47,976
<Caption>
SHARES VALUE
UNITED KINGDOM - 31.96% (CONTINUED)
Rechitt Benckiser Plc 2,230 $ 40,920
Reed Elsevier Plc 5,022 41,788
Rentokil Initial Plc 7,373 23,025
Rio Tinto Plc Reg 4,157 78,201
Royal Bank of Scotland Group Plc 10,790 302,690
Sainsbury (J) Plc 5,734 24,034
Scottish & Southern Energy 3,348 34,474
Scottish Power Plc 7,262 43,620
Shell Transport & Trading Co 38,076 251,327
South African Breweries* 3,197 21,405
Smith & Nephew Plc 3,634 20,884
Smiths Group Plc 2,159 25,046
Syngenta AG 407 20,403
Tesco Plc 28,480 103,040
Unilever Plc 10,853 86,412
United Utilities Plc 2,165 21,043
Vodafone Group Plc 268,584 525,201
Wolseley Plc 2,327 25,737
WPP Group Plc 4,510 35,351
--------------
5,463,480
--------------
Total Common Stocks
(cost $15,714,140) 16,914,665
--------------
UNIT INVESTMENT TRUST - 0.67%
iShares MSCI Eafe Index Fund* 1,050 113,726
--------------
Total Unit Investment Trust
(cost $96,421) 113,726
--------------
SHORT-TERM INVESTMENTS - 0.04%
NORTHERN TRUST DIVERSIFIED ASSETS FUND -
0.04% 7,611 7,611
--------------
Total Short-Term Investments
(cost $7,611) 7,611
--------------
TOTAL INVESTMENTS - 99.64%
(cost $15,818,172)(1) 17,036,002
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(2) - 6.80% 1,162,146
--------------
OTHER ASSETS AND LIABILITIES - (6.44%) (1,101,261)
--------------
TOTAL NET ASSETS - 100.00% $ 17,096,887
==============
</Table>
- -------------
* Non-income producing
(1) For federal income tax purposes, cost is $15,873,754 and gross
unrealized appreciation and depreciation of securities as of
June 30, 2003 was $1,457,945 and ($295,697), respectively.
(2) This security was purchased with cash collateral held from
securities lending.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
59
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
SCHEDULE OF INVESTMENTS LEHMAN AGGREGATE BOND INDEX PORTFOLIO
- ---------------------------------------------------------------------------
JUNE 30, 2003
(UNAUDITED)
<Table>
<Caption>
PRINCIPAL VALUE
U.S. TREASURY OBLIGATIONS - 21.28%
U.S. TREASURY NOTES & BONDS - 21.28%
6.500% due 05/15/05 $ 625,000 $ 685,449
5.500% due 02/15/08 625,000 712,134
6.250% due 08/15/23 650,000 796,199
--------------
Total U.S. Treasury Obligations
(cost $2,144,600) 2,193,782
--------------
U.S. GOVERNMENT AGENCY OBLIGATIONS -
45.56%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 45.56%
3.500% due 09/15/07 1,300,000 1,359,047
5.000% due 11/01/17 489,639 506,541
5.000% due 05/01/18 199,253 205,976
6.500% due 04/01/23 180,452 190,714
6.000% due 11/01/32 2,341,262 2,433,982
--------------
Total U.S. Government Agency
Obligations
(cost $4,665,123) 4,696,260
--------------
SOVEREIGN GOVERNMENT BONDS - 0.97%
Republic of Italy
(2.500% due 07/15/08) 100,000 99,470
--------------
Total Sovereign Government Bonds
(cost $99,521) 99,470
--------------
COLLATERALIZED MORTGAGE OBLIGATIONS - 2.08%
PRIVATE SECTOR - 2.08%
Countrywide (6.815% due 01/25/29) 101,887 108,535
Vanderbilt Acquisition Loan Trust
(5.700% due 09/07/23) 100,000 106,014
--------------
Total Collateralized Mortgage
Obligations
(cost $213,232) 214,549
--------------
CORPORATE BONDS AND NOTES - 26.86%
BANK, BANK HOLDING COMPANIES, &
OTHER BANK SERVICES - 3.77%
Citigroup Capital (7.750% due
12/01/36) 100,000 115,925
Key Bank (5.000% due 07/17/07) 80,000 86,675
Merrill Lynch (6.375% due 10/15/08) 80,000 92,528
U.S. Bank NA (6.375% due 08/01/11) 80,000 93,389
--------------
388,517
--------------
CAPITAL GOODS - 3.47%
Eaton Corp. (5.750% due 07/15/12) 80,000 87,479
Honeywell International (7.500% due
03/01/10) 80,000 97,758
Masco Corp (5.875% due 07/15/12) 80,000 88,842
Pitney Bowes Inc. (4.625% due
10/01/12) 80,000 83,639
--------------
357,718
--------------
CONSUMER NON-DURABLE - 5.34%
Campbell Soup Co. (5.500% due
03/15/07) 80,000 88,173
Cargill Inc.(2) (6.250% due 05/01/06) 80,000 89,251
Commonwealth Edison (6.150% due
03/15/12) 80,000 91,723
<Caption>
PRINCIPAL VALUE
CONSUMER NON-DURABLE - 5.34% (CONTINUED)
E.W. Scripps Co (5.750% due 07/15/12) $ 80,000 $ 90,009
TIAA Global Market(2) (4.125% due
11/15/07) 80,000 84,668
UPM-Kymmene Corp.(2) (5.625% due
12/01/14) 100,000 107,270
--------------
551,094
--------------
CONSUMER STAPLES - .88%
General Mills Inc. (6.000% due
02/15/12) 80,000 90,317
--------------
ENERGY - 2.68%
Conoco Funding Co. (6.350% due
10/15/11) 80,000 93,446
Keyspan Corp. (7.250% due 11/15/05) 80,000 89,769
Public Service Inc. (6.625% due
02/15/11) 80,000 92,736
--------------
275,951
--------------
FINANCE - 3.55%
American General Finance (5.375% due
09/01/09) 80,000 87,412
Devon Financing Corp. (6.875% due
09/30/11) 80,000 93,843
General Electric Capital Corp (6.875%
due 11/15/10) 80,000 95,636
Household Finance Corp. (5.875% due
02/01/09) 80,000 89,190
--------------
366,081
--------------
HEALTH CARE - 1.71%
Amgen Inc. (6.500% due 12/01/07) 80,000 90,531
CSX Corp. (4.875% due 11/01/09) 80,000 85,232
--------------
175,763
--------------
MANUFACTURING - 3.77%
Alcoa Inc. (7.375% due 08/01/10) 80,000 96,925
Colonial Pipeline Co. (6.580% due
08/28/32) 100,000 115,750
GTE North Inc. (6.940% due 04/15/28) 80,000 90,788
Weyerhauser Co. (5.250% due 12/15/09) 80,000 85,602
--------------
389,065
--------------
TELECOMMUNICATIONS - 1.69%
Citizen Communications (9.250% due
05/15/11)
Sprint Capital Corp. (6.000% due
01/15/07) 80,000 85,972
Verizon Wireless (5.375% due 12/15/06) 80,000 87,868
--------------
173,840
--------------
Total Corporate Bonds & Notes
(cost $2,682,427) 2,768,346
--------------
<Caption>
SHARES VALUE
SHORT-TERM INVESTMENTS - 3.29%
NORTHERN TRUST DIVERSIFIED
ASSETS FUND - 3.29% 339,083 $ 339,083
--------------
Total Short-Term Investments
(cost $339,083) 339,083
--------------
TOTAL INVESTMENTS - 100.04%
(cost $10,143,986)(1) 10,311,490
--------------
NORTHERN INSTITUTIONAL LIQUID ASSET
PORTFOLIO(3) - 35.97% 3,707,579
--------------
OTHER ASSETS AND LIABILITIES - (36.01%) (3,711,906)
--------------
TOTAL NET ASSETS - 100.00% $ 10,307,163
==============
</Table>
- -------------
(1) For federal income tax purposes, cost is $10,143,986 and gross
unrealized appreciation and depreciation of securities as of
June 30, 2003 was $169,044 and ($1,540), respectively.
(2) Security exempt from registration under Rule 144(a) of the
Securities Act of 1933. These securities may be resold in
transactions exempt from registration, normally to qualified
institutional buyers.
(3) This security was purchased with cash collateral held from
securities lending.
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS.
60
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- ---------------------------------------------------------------------------
JUNE 30, 2003 (UNAUDITED)
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
Summit Mutual Funds, Inc., (the "Fund"), is registered under the Investment
Company Act of 1940, as amended, as a no-load, diversified, open-end management
investment company. The Fund is offered in two series, the Pinnacle Series and
the Apex Series. The results of the Pinnacle Series (the "Series") are presented
herein. The shares of the Series are sold only to insurance companies and their
separate accounts to fund the benefits under certain variable insurance
products. The results of the Series presented exclude the additional fees and
expenses of variable annuity or variable life insurance contracts. The Series'
shares are offered in eight different portfolios - Zenith Portfolio, Bond
Portfolio, S&P 500 Index Portfolio, S&P MidCap 400 Index Portfolio, Balanced
Index Portfolio, Nasdaq-100 Index Portfolio, Russell 2000 Small Cap Index
Portfolio, EAFE International Index Portfolio, and Lehman Aggregate Bond Index
Portfolio (individually "Portfolio", collectively "Portfolios"). The Zenith
Portfolio seeks long-term appreciation of capital by investing primarily in
common stocks and other equity securities. The Bond Portfolio seeks a high level
of current income as is consistent with reasonable investment risk by investing
primarily in long-term, fixed-income, investment-grade corporate bonds. The S&P
500 Index Portfolio, S&P MidCap 400 Index Portfolio, Russell 2000 Small Cap
Index Portfolio, Nasdaq-100 Index Portfolio, EAFE International Index Portfolio,
and Lehman Aggregate Bond Index Portfolio seek investment results that
correspond to the total return performance of common stocks as represented by
their respective index. The Balanced Index Portfolio seeks investment results,
with respect to 60% of its assets, that correspond to the total return
performance of U.S. common stocks, as represented by the S&P 500 Index and, with
respect to 40% of its assets, that correspond to the total return performance of
investment grade bonds, as represented by the Lehman Brothers Aggregate Bond
Index. The Lehman Aggregate Bond Index Portfolio seeks investment results that
correspond to the total return performance of the bond market, as represented by
the Lehman Brothers Aggregate Bond Index.
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America ("generally accepted
accounting principles") requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent 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.
SECURITIES VALUATION - Securities held in each Portfolio, except for money
market instruments maturing in 60 days or less, are valued as follows:
Securities traded on stock exchanges (including securities traded in both the
over-the-counter market and on an exchange), or listed on the NASDAQ National
Market System, are valued at the last sales price as of the close of the New
York Stock Exchange on the day the securities are being valued, or, lacking any
sales, at the closing bid prices. Alternatively, NASDAQ listed securities may be
valued on the basis of the NASDAQ Official Closing Price. Securities traded only
in the over-the-counter market are valued at the last bid price, as of the close
of trading on the New York Stock Exchange, quoted by brokers that make markets
in the securities. Other securities for which market quotations are not readily
available are valued at fair value as determined in good faith under procedures
adopted by the Board of Directors. Money market instruments with a remaining
maturity of 60 days or less held in each Portfolio are valued at amortized cost
which approximates market.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME - Securities transactions are
recorded on the trade date (the date the order to buy or sell is executed).
Dividend income is recorded on the ex-dividend date and interest income is
recorded on the accrual basis. All amortization of discount and premium is
recognized currently under the effective interest method. Gains and losses on
sales of investments are calculated on the identified cost basis for financial
reporting and tax purposes. Paydown gains and losses on mortgage and
asset-backed securities are presented as interest income.
FEDERAL TAXES - It is the intent of the Fund to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and to
distribute all of its net investment income and any net realized capital gains.
Regulated investment companies owned by the segregated asset accounts of a life
insurance company, held in connection with variable annuity contracts, are
exempt from excise tax on undistributed income. Therefore, no provision for
income or excise taxes has been recorded. The Zenith Portfolio, Bond Portfolio,
S&P 500 Index Portfolio, S&P MidCap 400 Index
61
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Portfolio, Balanced Index Portfolio, Nasdaq-100 Index Portfolio, and Russell
2000 Small Cap Index Portfolio have a capital loss carry forward of $2,172,491,
$6,339,965, $2,954,700, $1,183,610, $574,389, $6,142,851, and $858,626,
respectively, which expire between 2006 and 2009.
<Table>
<Caption>
TAX CHARACTER OF DISTRIBUTIONS PAID
--------------------------------------------------------------------------------
- ----
YEAR ENDED DECEMBER 31, 2002 YEAR ENDED DECEMBER 31, 2001
------------------------------------ --------------------------------------
LONG-TERM LONG-TERM
ORDINARY CAPITAL TOTAL ORDINARY CAPITAL TOTAL
FUND INCOME GAINS DISTRIBUTIONS INCOME GAINS DISTRIBUTIONS
- ---- ---------- --------- ------------- ----------- ---------- -------------
Zenith Portfolio $3,452,162* $ -- $3,452,162 $ 858,337 $ -- $ 858,337
Bond Portfolio 1,934,326 -- 1,934,326 1,163,914 -- 1,163,914
S&P 500 Index Portfolio 474,970 131,130 606,100 11,024,779 7,375,447 18,400,226
S&P MidCap 400 Index
Portfolio 107,543 78,555 186,098 2,022,782 1,417,829 3,440,611
Balanced Index Portfolio 426,657 -- 426,657 598,368 31,315 629,683
Nasdaq-100 Index
Portfolio -- -- -- -- -- --
Russell 2000 Small Cap
Index Portfolio 37,810 194,514 232,324 886,710 -- 886,710
EAFE International Index
Portfolio -- -- -- -- -- --
* $2,544,857 is a return of capital.
</Table>
<Table>
<Caption>
TAX BASIS OF DISTRIBUTABLE EARNINGS
AS OF DECEMBER 31, 2002
-----------------------------------------
UNDISTRIBUTED UNDISTRIBUTED
ORDINARY LONG-TERM UNREALIZED
FUND INCOME GAINS APPRECIATION
- ---- ------------- ------------- ------------
Zenith Portfolio $ -- $ -- $ --
Bond Portfolio 297,898 -- 485,068
S&P 500 Index Portfolio 544,576 -- 9,042,197
S&P MidCap 400 Index Portfolio 84,660 -- --
Balanced Index Portfolio 47,456 -- --
Nasdaq-100 Index Portfolio -- -- --
Russell 2000 Small Cap Index
Portfolio 101,642 -- --
EAFE International Index Portfolio 87,181 313,314 34,141
</Table>
The difference between book basis and tax basis unrealized depreciation is
attributable primarily to the tax deferral of losses on wash sales and
mark-to-market adjustments for futures contracts.
DISTRIBUTIONS - Distributions from net investment income in all fixed income
Portfolios generally are declared and paid quarterly. Equity Portfolios
generally declare and pay dividends annually. Net realized capital gains are
distributed periodically, no less frequently than annually. Distributions are
recorded on the ex-dividend date. All distributions are reinvested in additional
shares of the respective Portfolio at the net asset value per share.
The amount of distributions are determined in accordance with federal income tax
regulations which may differ from generally accepted accounting principles.
These "book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such amounts
are reclassified within the capital accounts based on their federal tax-basis
treatment; temporary differences do not require reclassification.
62
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- ----------------------------------------------------------------------------
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
EXPENSES - Allocable expenses of the Fund are charged to each Portfolio based on
the ratio of the net assets of each Portfolio to the combined net assets of the
Fund. Nonallocable expenses are charged to each Portfolio based on specific
identification.
FOREIGN CURRENCY - The Portfolio's accounting records are maintained in U.S.
dollars. All Portfolios may purchase foreign securities within certain
limitations set forth in theProspectus. Amounts denominated in or expected to
settle in foreign currencies are translated into U.S. dollars at the spot rate
at the close of the London Market. The Portfolio does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates on
investments from the underlying fluctuation in the securities resulting from
market prices. All are included in net realized and unrealized gain or loss for
investments.
Foreign security and currency transactions may involve certain risks not
typically associated with those of U.S. companies including the level of
governmental supervision and regulations of foreign securities markets and the
possibility of political and economic instability.
NOTE 2 - TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISORY FEES - The Fund pays investment advisory fees to Summit
Investment Partners, Inc. (the "Adviser") under terms of an Investment Advisory
Agreement (the "Agreement"). Certain officers and directors of the Adviser are
affiliated with the Fund. The Fund pays the Adviser, as full compensation for
all services and facilities furnished, a monthly fee computed separately for
each Portfolio on a daily basis, at an annual rate, as follows:
(a) for the Zenith Portfolio - .64% of the current net asset value.
(b) for the Bond Portfolio - .47% of the current net asset value.
(c) for the S&P 500 Index Portfolio - .30% of the current net asset
value.
(d) for the S&P MidCap 400 Index Portfolio - .30% of the current net
asset value.
(e) for the Balanced Index Portfolio - .30% of the current net asset
value.
(f) for the Nasdaq-100 Index Portfolio - .35% of the current net asset
value.
(g) for the Russell 2000 Small Cap Index Portfolio - .35% of the current
net asset value.
(h) for the EAFE International Index Portfolio - .56% of the current net
asset value.
(i) for the Lehman Aggregate Bond Index Portfolio - .30% of the current
net asset value.
The Agreement provides that if the total operating expenses of the Zenith or
Bond Portfolios, exclusive of advisory fees and certain other expenses, for any
fiscal quarter exceed an annual rate of 1% of the average daily net assets of
the respective Portfolios, the Adviser will reimburse the Portfolio for such
excess, up to the amount of the advisory fee for that year. The Adviser has
agreed to pay other expenses of the S&P 500 Index Portfolio, the S&P MidCap 400
Index Portfolio, Balanced Index Portfolio, the Nasdaq-100 Index Portfolio, and
the Lehman Aggregate Bond Index Portfolio, other than the advisory fee for these
Portfolios, to the extent that such expenses exceed 0.30% of their average
annual net assets. The Adviser will pay any expenses of the Russell 2000 Small
Cap Index Portfolio, other than the advisory fee for that Portfolio, to the
extent that such expenses exceed 0.40% of that Portfolio's average annual net
asset. The Adviser will pay any expenses of the EAFE International Index
Portfolio, other than the advisory fee for that Portfolio, to the extent that
such expenses exceed 0.69% of that Portfolio's average annual net asset. The
Adviser agreed to waive its fees and/or reimburse expenses of the EAFE
International Index Portfolio, to the extent necessary, to limit all expenses to
0.65% of the average daily net assets of the Portfolio until December 31, 2003.
The Adviser will pay any expenses of the Lehman Aggregate Bond Index Portfolio,
other than the advisory fee for that Portfolio, to the extent that such expenses
exceed 0.30% of that Portfolio's average annual net asset.
63
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------
NOTE 2 - TRANSACTIONS WITH AFFILIATES (CONTINUED)
ADMINISTRATION FEES - The Fund pays the Adviser to perform certain
administration services. The Fund shall pay the Adviser as full compensation for
all facilities and services furnished a fee computed separately for each
portfolio of the Fund at an annual rate .10% of each portfolio's average annual
net assets. The Advisor has agreed to waive administration fees for the Bond
Portfolio, as long as that Portfolio's total expense ratio exceeds .75%.
WAIVERS AND REIMBURSEMENTS - As a result, for the period ended June 30, 2003,
the Adviser waived for the Bond Portfolio $13,991, and the Adviser reimbursed
fees for the S&P 500 Index Portfolio $159, S&P MidCap 400 Index Portfolio
$14,877, Balanced Index Portfolio $22,630, Nasdaq-100 Index Portfolio $26,415,
the Russell 2000 Small Cap Index Portfolio $41,640, the EAFE International Index
Portfolio $151,832 and the Lehman Aggregate Bond Index Portfolio $14,707.
Summit Investment Partners, Inc. is a wholly-owned subsidiary of The Union
Central Life Insurance Company ("Union Central").
DIRECTORS' FEES - Each director who is not affiliated with the Adviser receives
fees from the Fund for service as a director. Members of the Board of Directors
who are not affiliated with the Adviser are eligible to participate in a
deferred compensation plan. The value of each director's deferred compensation
account will increase or decrease at the same rate as if it were invested in
shares of the Scudder Money Market Fund.
NOTE 3 - FUTURES CONTRACTS AND PORTFOLIO SECURITIES LOANED
S&P 500 Index Portfolio, S&P MidCap 400 Index Portfolio, Balanced Index
Portfolio, Nasdaq-100 Index Portfolio, and Russell 2000 Small Cap Index
Portfolio (collectively, the "Index Portfolios") may enter into futures
contracts that relate to securities in which it may directly invest and indices
comprised of such securities and may purchase and write call and put options on
such contracts. The Index Portfolios may invest up to 20% of their assets in
such futures and/or options, except that until each Portfolio reaches $25
million (or $50 million in the case of the Nasdaq-100 Index Portfolio, the
Russell 2000 Small Cap Index Portfolio, and the EAFE International Index
Portfolio), it may invest up to 100% in such futures and/or options. These
contracts provide for the sale of a specified quantity of a financial instrument
at a fixed price at a future date. When the Index Portfolios enter into a
futures contract, they are required to deposit and maintain as collateral such
initial margin as required by the exchange on which the contract is traded.
Under terms on the contract, the Index Portfolios agree to receive from or pay
to the broker an amount equal to the daily fluctuation in the value of the
contract (known as the variation margin). The variation margin is recorded as
unrealized gain or loss until the contract expires or is otherwise closed, at
which time the gain or loss is realized. The Index Portfolios invest in futures
as a substitute to investing in the common stock positions in the Index that
they intend to match. The potential risk to the Index Portfolios is that the
change in the value in the underlying securities may not correlate to the value
of the contracts.
The Portfolios lend their securities to approved brokers to earn additional
income and receive cash and/or securities as collateral to secure the loans.
Collateral is maintained at not less than 100% of the value of loaned
securities. Although the risk of lending is mitigated by the collateral, the
Portfolios could experience a delay in recovering its securities and a possible
loss of income or value if the borrower fails to return them. In addition to
cash collateral, the Portfolios have accepted noncash collateral consisting of
government securities and irrevocable letters of credit from domestically
domiciled banks in the total amount of $969,921 for Bond Portfolio, $195,770 for
S&P 500 Index Portfolio, $34,997 for S&P MidCap 400 Index Portfolio, $347,888
for Balanced Index Portfolio, $837 for Russell 2000 Small Cap Index Portfolio,
$175,858 for EAFE International Index Portfolio, and $822,929 for Lehman
Aggregate Bond Portfolio.
64
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- ---------------------------------------------------------------------------
NOTE 3 - FUTURES CONTRACTS AND PORTFOLIO SECURITIES LOANED (CONTINUED)
As of June 30, 2003, the market value of the securities on loan and the total
collateral purchased with the cash received and held is as follows:
<Table>
<Caption>
FUND SECURITIES LOANED COLLATERAL
- ---- ----------------- -------------
Zenith Portfolio $ 3,109,167 $ 3,234,520
Bond Portfolio 11,842,798 12,126,187
S&P 500 Index Portfolio 5,184,168 5,356,688
S&P MidCap 400 Index Portfolio 4,202,235 4,333,159
Balanced Index Portfolio 2,275,125 2,332,999
Nasdaq-100 Index Portfolio 1,302,379 1,319,606
Russell 2000 Small Cap Index Portfolio 1,971,861 2,038,198
EAFE International Index Portfolio 1,258,047 1,338,004
Lehman Aggregate Index Portfolio 4,447,284 4,530,508
</Table>
NOTE 4 - SUMMARY OF PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of securities for the period ended June 30, 2003, excluding
short-term obligations, are as follows:
<Table>
<Caption>
S&P 500 S&P MIDCAP 400
ZENITH PORTFOLIO BOND PORTFOLIO INDEX PORTFOLIO INDEX PORTFOLIO
---------------- -------------- --------------- ---------------
Total Cost of Purchases of:
Common Stocks $ 10,020,051 $ -- $ 245,436 $ 1,224,295
U.S. Government
Securities -- 8,777,592 -- --
Corporate Bonds -- 17,290,987 -- --
------------ ------------ ------------ ------------
$ 10,020,051 $ 26,068,579 $ 245,436 $ 1,224,295
============ ============ ============ ============
Total Proceeds from Sales of:
Common Stocks $ 11,716,300 $ -- $ 3,251,978 $ 981,837
U.S. Government
Securities -- 10,247,585 -- --
Corporate Bonds -- 12,820,877 -- --
------------ ------------ ------------ ------------
$ 11,716,300 $ 23,068,462 $ 3,251,978 $ 981,837
============ ============ ============ ============
</Table>
<Table>
<Caption>
LEHMAN
RUSSELL 2000 EAFE AGGREGATE
BALANCED NASDAQ-100 SMALL CAP INTERNATIONAL BONDINDEX
INDEX PORTFOLIO INDEX PORTFOLIO INDEX PORTFOLIO INDEX PORTFOLIO PORTFOLIO
--------------- --------------- --------------- --------------- -----------
Total Cost of
Purchases of:
Common Stocks $ 18,713 $ 1,562,061 $ 3,223,462 $ 7,870,975 $ 2,835,109
U.S. Government
Securities 1,606,130 -- -- -- 7,413,905
Corporate Bonds 74,817 -- -- -- --
----------- ----------- ----------- ----------- -----------
$ 1,699,660 $ 1,562,061 $ 3,223,462 $ 7,870,975 $10,249,014
=========== =========== =========== =========== ===========
Total Proceeds
from Sales of:
Common Stocks $ 33,211 $ 33,952 $ 3,065,443 $12,540,860 $ 226,237
U.S. Government
Securities 1,283,776 -- -- -- 179,981
Corporate Bonds 503,416 -- -- -- --
----------- ----------- ----------- ----------- -----------
$ 1,820,403 $ 33,952 $ 3,065,443 $12,540,860 $ 406,218
=========== =========== =========== =========== ===========
</Table>
65
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- ----------------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result
of the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
ZENITH PORTFOLIO
SIX MONTHS
ENDED JUNE 30,
(UNAUDITED) YEAR ENDED DECEMBER 31,
--------------- ---------------------------------------------
2003 2002 2001 2000 1999 1998
--------------- ------- ------- ------- -------- --------
Net Asset Value,
Beginning of period $ 59.67 $ 82.75 $ 75.60 $ 63.10 $ 74.45 $ 101.75
------- ------- ------- ------- -------- --------
Investment Activities:
Net investment income .48 1.11 1.40 1.15 .50 1.25
Net realized and
unrealized
gains/(losses) 9.99 (18.92) 7.05 12.40 (.25) (14.00)
------- ------- ------- ------- -------- --------
Total from Investment
Activities 10.47 (17.81) 8.45 13.55 .25 (12.75)
------- ------- ------- ------- -------- --------
Distributions:
Net investment income (.09) (1.39) (1.30) (1.05) (.60) (1.15)
In excess of net
investment income -- -- -- -- -- --
Return of capital -- (3.88) -- -- -- --
Net realized gains -- -- -- -- (11.00) (13.40)
------- ------- ------- ------- -------- --------
Total Distributions (.09) (5.27) (1.30) (1.05) (11.60) (14.55)
------- ------- ------- ------- -------- --------
Net Asset Value,
End of period $ 70.05 $ 59.67 $ 82.75 $ 75.60 $ 63.10 $ 74.45
======= ======= ======= ======= ======== ========
Total Return 17.58% (23.10%) 11.24% 21.79% 2.05% (15.31%)
RATIOS / SUPPLEMENTAL
DATA:
Ratio of Expenses to
Average Net Assets -
Net(2) .97%(3) .93% .81% .73% .69% .62%
Ratio of Expenses to
Average Net Assets -
Gross .97%(3) .93% .83% .77% .69% .62%
Ratio of Net Investment
Income to Average Net
Assets 1.53%(3) 1.52% 1.74% 1.47% .67% 1.41%
Portfolio Turnover Rate 55.00%(3) 56.53% 102.03% 81.95% 86.47% 62.50%
Net Assets, End of Period
(000's) $41,818 $38,218 $54,562 $50,485 $124,444 $248,783
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Adviser.
(3) Annualized.
66
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS (CONTINUED)
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result of
the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
BOND PORTFOLIO
SIX MONTHS
ENDED JUNE 30,
(UNAUDITED) YEAR ENDED DECEMBER 31,
-------------- ------------------------------------------------
2003 2002 2001 2000 1999 1998
-------------- -------- -------- -------- -------- --------
Net Asset Value,
Beginning of period $ 47.93 $ 48.15 $ 47.30 $ 51.80 $ 55.65 $ 56.45
-------- -------- -------- -------- -------- --------
Investment Activities:
Net investment income 1.38 2.70 3.15 5.20 3.60 3.85
Net realized and
unrealized
gains/(losses) 1.46 (.04) -- (1.95) (4.20) (.25)
-------- -------- -------- -------- -------- --------
Total from Investment
Activities 2.84 2.66 3.15 3.25 (.60) 3.60
-------- -------- -------- -------- -------- --------
Distributions:
Net investment income (1.31) (2.88) (2.30) (5.75) (3.25) (3.80)
In excess of net
investment income -- -- -- (.30) -- --
Return of capital -- -- -- (1.70) -- --
Net realized gains -- -- -- -- -- (.60)
-------- -------- -------- -------- -------- --------
Total Distributions (1.31) (2.88) (2.30) (7.75) (3.25) (4.40)
-------- -------- -------- -------- -------- --------
Net Asset Value,
End of period $ 49.46 $ 47.93 $ 48.15 $ 47.30 $ 51.80 $ 55.65
======== ======== ======== ======== ======== ========
Total Return 6.01% 5.73% 6.81% 7.40% (1.11%) 6.52%
RATIOS / SUPPLEMENTAL
DATA:
Ratio of Expenses to
Average Net Assets -
Net(2) .75%(3) .76% .79% .61% .60% .58%
Ratio of Expenses to
Average Net Assets -
Gross .82%(3) .85% .87% .68% .60% .58%
Ratio of Net Investment
Income to Average Net
Assets 5.83%(3) 5.86% 6.37% 6.85% 6.62% 6.84%
Portfolio Turnover Rate 125.84%(3) 54.27% 65.14% 60.19% 56.07% 67.57%
Net Assets, End of Period
(000's) $ 39,065 $35,415 $29,147 $22,802 $98,428 $113,762
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Adviser.
(3) Annualized.
67
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- ------------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS (CONTINUED)
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result
of the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
S&P 500 INDEX PORTFOLIO
SIX MONTHS
ENDED JUNE 30,
(UNAUDITED) YEAR ENDED DECEMBER 31,
--------------- ----------------------------------------------
2003 2002 2001 2000 1999 1998
--------------- ------- ------- -------- -------- --------
Net Asset Value,
Beginning of period $ 57.82 $ 75.15 $102.95 $ 115.60 $ 97.45 $ 78.70
------- ------- ------- -------- -------- --------
Investment Activities:
Net investment income .37 .69 .80 1.05 1.05 1.00
Net realized and
unrealized gains /
(losses) 6.15 (17.53) (12.15) (11.75) 18.75 21.05
------- ------- ------- -------- -------- --------
Total from Investment
Activities 6.52 (16.84) (11.35) (10.70) 19.80 22.05
------- ------- ------- -------- -------- --------
Distributions:
Net investment income (.59) (.38) (.55) (1.15) (.95) (1.00)
In excess of net
investment income -- -- -- -- -- --
Return of capital -- -- -- -- -- --
Net realized gains -- (.11) (15.90) (.80) (.70) (2.30)
------- ------- ------- -------- -------- --------
Total Distributions (.59) (.49) (16.45) (1.95) (1.65) (3.30)
------- ------- ------- -------- -------- --------
Net Asset Value,
End of period $ 63.75 $ 57.82 $ 75.15 $ 102.95 $ 115.60 $ 97.45
======= ======= ======= ======== ======== ========
Total Return 11.44% (22.55%) (12.39%) (9.32%) 20.52% 28.54%
RATIOS / SUPPLEMENTAL
DATA:
Ratio of Expenses to
Average Net Assets -
Net(2) .56%(3) .57% .46% .41% .39% .43%
Ratio of Expenses to
Average Net Assets -
Gross .56%(3) .61% .47% .43% .39% .43%
Ratio of Net Investment
Income to Average Net
Assets 1.20%(3) 1.04% .88% .81% 1.10% 1.25%
Portfolio Turnover Rate .81%(3) 10.51% 3.30% 21.36% 3.45% 2.64%
Net Assets, End of Period
(000's) $68,747 $64,338 $92,639 $114,103 $284,132 $131,345
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Adviser.
(3) Annualized.
68
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS (CONTINUED)
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result
of the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
S&P MIDCAP 400 INDEX PORTFOLIO
SIX MONTHS PERIOD FROM
ENDED JUNE 30, MAY 3, 1999(1)
(UNAUDITED) YEAR ENDED DECEMBER 31, TO DECEMBER 31,
--------------- ------------------------- ----------------
2003 2002 2001 2000 1999
--------------- ------- ------- ------- ----------------
Net Asset Value,
Beginning of period $ 39.29 $ 46.70 $ 59.55 $ 55.20 $ 50.00
------- ------- ------- ------- -------
Investment Activities:
Net investment income .12 .22 .30 1.10 .50
Net realized and
unrealized
gains/(losses) 4.59 (7.25) (1.00) 7.20 5.05
------- ------- ------- ------- -------
Total from Investment
Activities 4.71 (7.03) (.70) 8.30 5.55
------- ------- ------- ------- -------
Distributions:
Net investment income (.17) (.23) (.20) (1.20) (.35)
In excess of net
investment income -- -- -- -- --
Return of capital -- -- -- -- --
Net realized gains -- (.15) (11.95) (2.75) --
------- ------- ------- ------- -------
Total Distributions (.17) (.38) (12.15) (3.95) (.35)
------- ------- ------- ------- -------
Net Asset Value,
End of period $ 43.83 $ 39.29 $ 46.70 $ 59.55 $ 55.20
======= ======= ======= ======= =======
Total Return 12.07% (15.15%) (1.25%) 15.99% 11.14%
RATIOS / SUPPLEMENTAL
DATA:
Ratio of Expenses to
Average Net Assets -
Net(2) .60%(3) .60% .60% .60% .60%(3)
Ratio of Expenses to
Average Net Assets -
Gross .73%(3) .81% .82% .77% .69%(3)
Ratio of Net Investment
Income to Average Net
Assets .60%(3) .53% .65% 1.44% 1.69%(3)
Portfolio Turnover Rate 9.26%(3) 27.73% 18.57% 146.33% 47.55%(3)
Net Assets, End of Period
(000's) $27,440 $23,180 $20,588 $15,054 $23,963
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Adviser.
(3) Annualized.
69
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS (CONTINUED)
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result
of the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
BALANCED INDEX PORTFOLIO
SIX MONTHS PERIOD FROM
ENDED JUNE 30, MAY 3, 1999(1)
(UNAUDITED) YEAR ENDED DECEMBER 31, TO DECEMBER 31,
--------------- ------------------------- ----------------
2003 2002 2001 2000 1999
--------------- ------- ------- ------- ----------------
Net Asset Value,
Beginning of period $ 37.50 $ 43.85 $ 48.05 $ 52.05 $ 50.00
------- ------- ------- ------- -------
Investment Activities:
Net investment income .48 1.13 1.10 1.95 .90
Net realized and
unrealized
gains/(losses) 2.60 (6.01) (3.15) (2.65) 1.70
------- ------- ------- ------- -------
Total from Investment
Activities 3.08 (4.88) (2.05) (.70) 2.60
------- ------- ------- ------- -------
Distributions:
Net investment income (.52) (1.47) (.60) (2.30) (.55)
In excess of net
investment income -- -- -- -- --
Return of capital -- -- -- -- --
Net realized gains -- -- (1.55) (1.00) --
------- ------- ------- ------- -------
Total Distributions (.52) (1.47) (2.15) (3.30) (.55)
------- ------- ------- ------- -------
Net Asset Value,
End of period $ 40.06 $ 37.50 $ 43.85 $ 48.05 $ 52.05
======= ======= ======= ======= =======
Total Return 8.31% (11.27%) (4.38%) (1.28%) 5.31%
RATIOS / SUPPLEMENTAL
DATA:
Ratio of Expenses to
Average Net Assets -
Net(2) .60%(3) .60% .60% .60% .47%(3)
Ratio of Expenses to
Average Net Assets -
Gross 1.03%(3) 1.10% .81% .68% .50%(3)
Ratio of Net Investment
Income to Average Net
Assets 2.52%(3) 2.78% 2.47% 2.95% 2.94%(3)
Portfolio Turnover Rate 36.27%(3) 15.34% 35.84% 9.60% 141.58%(3)
Net Assets, End of Period
(000's) $10,963 $10,638 $13,004 $14,334 $55,708
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Adviser.
(3) Annualized.
70
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- ---------------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS (CONTINUED)
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result
of the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
NASDAQ-100 INDEX PORTFOLIO
SIX MONTHS PERIOD FROM
ENDED JUNE 30, YEAR ENDED APRIL 27, 2000(1)
(UNAUDITED) DECEMBER 31, TO DECEMBER 31,
--------------- --------------- ------------------
2003 2002 2001 2000
--------------- ------ ------- ------------------
Net Asset Value,
Beginning of period $ 13.94 $22.30 $ 33.35 $ 50.00
------- ------ ------- -------
Investment Activities:
Net investment income (.02) (.07) -- (.05)
Net realized and unrealized
gains/(losses) 3.10 (8.29) (11.05) (16.60)
------- ------ ------- -------
Total from Investment
Activities 3.08 (8.36) (11.05) (16.65)
------- ------ ------- -------
Distributions:
Net investment income -- -- -- --
In excess of net investment
income -- -- -- --
Return of capital -- -- -- --
Net realized gains -- -- -- --
------- ------ ------- -------
Total Distributions -- -- -- --
------- ------ ------- -------
Net Asset Value,
End of period $ 17.02 $13.94 $ 22.30 $ 33.35
======= ====== ======= =======
Total Return 22.09% (37.49%) (33.13%) (33.30%)
RATIOS / SUPPLEMENTAL DATA:
Ratio of Expenses to Average
Net Assets - Net(2) .65%(3) .65% .65% .64%(3)
Ratio of Expenses to Average
Net Assets - Gross 1.10%(3) 1.11% .97% .88%(3)
Ratio of Net Investment Income
to Average Net Assets (.32%)(3) (.43%) (.21%) (.17%)(3)
Portfolio Turnover Rate .69%(3) 11.79% 5.49% 14.69%(3)
Net Assets, End of Period
(000's) $15,214 $9,583 $14,560 $8,577
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Adviser.
(3) Annualized.
71
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS (CONTINUED)
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result
of the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
RUSSELL 2000 SMALL CAP INDEX PORTFOLIO
SIX MONTHS PERIOD FROM
ENDED JUNE 30, YEAR ENDED APRIL 27, 2000(1)
(UNAUDITED) DECEMBER 31, TO DECEMBER 31,
--------------- ------------------ ------------------
2003 2002 2001 2000
--------------- -------- -------- ------------------
Net Asset Value,
Beginning of period $ 37.52 $ 48.10 $ 49.95 $ 50.00
------- ------- ------- -------
Investment Activities:
Net investment income .13 .29 .40 .40
Net realized and unrealized
gains/(losses) 6.43 (10.31) .35 (.20)
------- ------- ------- -------
Total from Investment
Activities 6.56 (10.02) .75 .20
------- ------- ------- -------
Distributions:
Net investment income (.29) (.09) (.45) (.25)
In excess of net investment
income -- -- -- --
Return of capital -- -- -- --
Net realized gains -- (.47) (2.15) --
------- ------- ------- -------
Total Distributions (.29) (.56) (2.60) (.25)
------- ------- ------- -------
Net Asset Value,
End of period $ 43.79 $ 37.52 $ 48.10 $ 49.95
======= ======= ======= =======
Total Return 17.68% (21.05%) 1.54% .39%
RATIOS / SUPPLEMENTAL DATA:
Ratio of Expenses to Average
Net Assets - Net(2) .75%(3) .75% .75% .74%(3)
Ratio of Expenses to Average
Net Assets - Gross 1.35%(3) 1.33% 1.10% 1.35%(3)
Ratio of Net Investment Income
to Average Net Assets .64%(3) .65% .90% 1.11%(3)
Portfolio Turnover Rate 52.82%(3) 30.78% 32.70% 82.19%(3)
Net Assets, End of Period
(000's) $16,360 $13,863 $21,503 $16,105
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Adviser.
(3) Annualized.
72
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- ---------------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS (CONTINUED)
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result
of the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
EAFE INTERNATIONAL INDEX
PORTFOLIO
SIX MONTHS PERIOD FROM
ENDED JUNE 30, NOVEMBER 12, 2002(1)
(UNAUDITED) TO DECEMBER
--------------- --------------------
2003 2002
--------------- --------------------
Net Assets Value,
Beginning of period $ 49.59 $ 50.00
------- -------
Investment Activities:
Net investment income .83 .19
Net realized and unrealized
gains/(losses) 2.70 (.60)
------- -------
Total from Investment Activities 3.53 (.41)
------- -------
Distributions:
Net investment income (.19) --
In excess of net investment income -- --
Return of capital -- --
Net realized gains (.82) --
------- -------
Total Distributions (1.01) --
------- -------
Net Asset Value,
End of period $ 52.11 $ 49.59
======= =======
Total Return 7.43% (.82%)
RATIOS / SUPPLEMENTAL DATA:
Ratio of Expenses to Average Net Assets
- Net(2) 0.65%(3) 0.65%(3)
Ratio of Expenses to Average Net Assets
- Gross 2.31%(3) 1.99%(3)
Ratio of Net Investment Income to
Average Net Assets 2.96%(3) 2.24%(3)
Portfolio Turnover Rate 89.96%(3) 449.05%(3)
Net Assets, End of Period (000's) $17,097 $22,234
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by Adviser.
(3) Annualized.
73
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
NOTES TO FINANCIAL STATEMENTS
- -----------------------------------------------------------------------
NOTE 5 - FINANCIAL HIGHLIGHTS (CONTINUED)
Computed on the basis of a share of capital stock outstanding throughout the
period. All share amounts and net asset values have been adjusted as a result
of the 1-for-5 reverse stock split on February 15, 2002, except for the EAFE
International Index Portfolio and Lehman Aggregate Bond Index Portfolio.
<Table>
<Caption>
LEHMAN AGGREGATE
BOND INDEX
PORTFOLIO
PERIOD FROM
APRIL 1, 2003(1)
TO JUNE 30,
(UNAUDITED)
-----------------
2003
-----------------
Net Asset Value,
Beginning of period $ 50.00
-------
Investment Activities:
Net investment income .38
Net realized and unrealized gains/(losses) .84
-------
Total from Investment Activities 1.22
-------
Distributions:
Net investment income (.20)
In excess of net investment income --
Return of capital --
Net realized gains --
-------
Total Distributions (.20)
-------
Net Asset Value,
End of period $ 51.02
=======
Total Return 2.44%
RATIOS / SUPPLEMENTAL DATA:
Ratio of Expenses to Average Net Assets - Net(2) .59%(3)
Ratio of Expenses to Average Net Assets - Gross 1.18%(3)
Ratio of Net Investment Income / (Loss) To Average
Net Assets 3.05%(3)
Portfolio Turnover Rate 16.53%(3)
Net Assets, End of Period (000's) $10,307
</Table>
- ----------
(1) Commencement of operations.
(2) Net expenses represent gross expenses reduced by fees waived and/or
reimbursed by the Adviser.
(3) Annualized.
74
<Page>
SUMMIT MUTUAL FUNDS, INC. - PINNACLE SERIES
MANAGEMENT OF THE FUND
- --------------------------------------------------------------------------------
DIRECTORS AND OFFICERS
INDEPENDENT DIRECTORS
<Table>
<Caption>
NUMBER OF
PORTFOLIOS
IN FUND
TERM OF COMPLEX OTHER
POSITION(S) OFFICE AND OVERSEEN DIRECTORSHIPS
WITH THE LENGTH OF PRINCIPAL OCCUPATION(S) BY HELD BY
NAME, AGE AND ADDRESS(1) FUND TIME SERVED DURING PAST FIVE YEARS DIRECTOR DIRECTOR
- -------------------------------------------------------------------------------------------------
George M. Callard, M.D. Director Director Professor of Clinical 22
(Age 69) since 1987 Surgery, University of
Cincinnati
Theodore H. Emmerich Director Director Consultant; former 22 American
(77) since 1987 Partner, Ernst & Financial
Whinney, Accountants Group; former
Director,
Summit
Investment
Trust (two
Portfolios)
Yvonne L. Gray Director Director Chief Operating 22
(52) since 1999 Officer, United Way and
Community Chest; prior
thereto, Vice
President/ Trust
Operations Officer,
Fifth Third Bank;
former Audit Manager,
Price Waterhouse
David C. Phillips Director Director Co-Founder and 22 Meridian
(64) since 2001 Treasurer, Cincinnati Bioscience, Inc.
Works Inc. (Job
Placement); prior
thereto, Chief
Executive Officer,
Downtown Cincinnati
Inc. (Economic
revitalization of
Cincinnati)
Mary W. Sullivan Director Director Attorney, Peck, 22 Franklin
(46) since 2001 Shaffer & Williams LLP Savings
and Loan Co.
</Table>
INTERESTED DIRECTORS AND OFFICERS
<Table>
<Caption>
NUMBER OF
PORTFOLIOS
IN FUND OTHER
TERM OF PRINCIPAL COMPLEX DIRECTOR-
POSITION(S) OFFICE AND OCCUPATION(S) OVERSEEN SHIPS
WITH THE LENGTH OF DURING PAST BY HELD BY
NAME, AGE AND ADDRESS(1) FUND TIME SERVED FIVE YEARS DIRECTOR DIRECTOR
- ------------------------------------------------------------------------------------------------
Harry Rossi* Director Director Director Emeritus, 22 Carillon
(83) since 1992 Union Central; Investments,
former Chairman, Inc.
President AND
Chief Executive
Officer, Union
Central and
Director, Adviser
Steven R. Sutermeister* Director, Director Senior Vice 22 Carillon
(49) President since 1999 President, Union Investments,
and Chief Central; President Inc.; Summit
Executive and Chief Investment
Officer Executive Officer, Partners, Inc.
Adviser.
John F. Labmeier Vice Officer Vice President, NA NA
1876 Waycross Rd. President since 1990 Associate General
Cincinnati, OH 45240 and Counsel and
(54) Secretary Assistant Secretary
Union Central;
Vice President
and Secretary,
Carillon
Investments, Inc.;
Secretary, Adviser
Thomas G. Knipper Controller Officer Treasurer, Adviser NA NA
(45) and since 1995
Treasurer
John M. Lucas Assistant Officer Second Vice NA NA
1876 Waycross Rd. Secretary since 1990 President, Counsel
Cincinnati, OH 45240 and Assistant
(52) Secretary,
Union Central
</Table>
- ------------
(1) Except as otherwise indicated, the business of each listed
person is 312 Elm St., Ste. 1212, Cincinnati, OH 45202
* Messrs. Rossi and Sutermeister are considered to be
"interested persons" of the Fund (within the meaning of
the Investment Company Act of 1940) because of their
affiliation with the Adviser.
<Page>
(This page has been left blank intentionally.)
<Page>
The Summit Pinnacle Series is distributed to insurance company
separate accounts available in variable annuity and variable
universal life insurance products. The Pinnacle Series consists
of the following Portfolios:
EQUITY INDEX ACCOUNTS
S&P 500 Index Portfolio
S&P MidCap 400 Index Portfolio
Russell 2000 Small Cap Index Portfolio
Nasdaq-100 Index Portfolio
EAFE International Index Portfolio
FIXED INCOME & BALANCED INDEX ACCOUNT
Balanced Index Portfolio
Lehman Aggregate Bond Index Portfolio
MANAGED ACCOUNTS
Zenith Portfolio
Bond Portfolio
The Summit Apex Series is a 100% No-Load Family of Mutual Funds intended for
institutional and retail accounts. For more complete information about the
Summit Mutual Funds' Apex Series, including charges and expenses, call
888-259-7565 for a prospectus. Please read it carefully before you invest or
send money. Summit Mutual Funds are distributed by Carillon Investments,
Inc., Cincinnati, Ohio, Member SIPC. The Apex Series consists of the
following Funds:
EQUITY INDEX ACCOUNTS
S&P 500 Index Fund
S&P MidCap 400 Index Fund
Russell 2000 Small Cap Index Fund
Nasdaq-100 Index Fund
EAFE International Index Fund
Total Social Impact Fund
FIXED INCOME & BALANCED INDEX ACCOUNTS
Balanced Index Fund
Lehman Aggregate Bond Index Fund
MANAGED ACCOUNTS
Everest Fund
Bond Fund
Short-term Government Fund
High Yield Bond Fund
STABLE VALUE ACCOUNT
Money Market Fund
Please visit our Website at www.summitfunds.com to learn more about the
Summit Mutual Funds.
SMFI 231PINNACLE 6/03
[LOGO] SUMMIT
MUTUAL
FUNDS
<page>
ITEM 2. CODE OF ETHICS
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not applicable.
ITEM 5. [RESERVED]
ITEM 6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES
Not applicable.
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES
(a) The Registrant's President and Treasurer have evaluated
the Registrant's disclosure controls and procedures
within 90 days of this filing and have concluded that
the Registrant's disclosure controls and procedures
were effective, as of that date, in ensuring that
information required to be disclosed by the Registrant
in this form N-CSR was recorded, processed, summarized,
and reported timely.
(b) There were no significant changes in Registrant's
internal controls or other factors that could
significantly affect these controls subsequent
to the date of their evaluation, including any
corrective actions with regard to significant
deficiencies and material weaknesses.
ITEM 10. EXHIBITS
(a) Code of Ethics. Not applicable to semiannual reports.
(b) Certifications pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 filed herewith.
(c) Certification pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 filed herewith.
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.
SUMMIT MUTUAL FUNDS, INC.
Date: September 4, 2003 /s/ Steven R. Sutermeister
----------------- By: -------------------------------
Steven R. Sutermeister,
President and Chief Executive Officer
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: /s/ Steven R. Sutermeister By: /s/ Thomas G. Knipper
---------------------------- --------------------------
Steven R. Sutermeister Thomas G. Knipper
President and Chief Executive Officer Controller and Treasurer
Date: September 4, 2003 Date: September 4, 2003
----------------- -----------------------