UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-07266
--------------------------
Principal Equity Income Fund, Inc.
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(Exact name of registrant as specified in charter)
711 High Street, Des Moines, IA 50392-2080
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(Address of principal executive offices) (Zip code)
Princor Financial Services Corporation, Des Moines, IA 50392-2080
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(Name and address of agent for service)
Registrant's telephone number, including area code: 515-247-5476
-------------------
Date of fiscal year end: October 31, 2005
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Date of reporting period: April 30, 2005
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ITEM 1 - REPORT TO STOCKHOLDERS
TABLE OF CONTENTS
PAGE
Shareholder Expense Example.............................................2
Financial Statements and Highlights
Statements of Assets and Liabilities................................... 6
Statements of Operations...............................................17
Statements of Changes in Net Assets....................................28
Notes to Financial Statements..........................................39
Schedules of Investments
Balanced Fund.........................................................51
Bond Fund.............................................................70
Capital Value Fund....................................................81
Cash Management Fund..................................................84
Equity Income Fund....................................................87
Government Securities Income Fund.....................................91
Growth Fund...........................................................94
International Emerging Markets Fund...................................96
International Fund....................................................100
International SmallCap Fund...........................................109
LargeCap Stock Index Fund.............................................114
Limited Term Bond Fund................................................123
MidCap Fund...........................................................133
Partners Blue Chip Fund...............................................136
Partners Equity Growth Fund...........................................140
Partners LargeCap Blend Fund..........................................142
Partners LargeCap Value Fund..........................................148
Partners MidCap Growth Fund...........................................151
Partners SmallCap Growth Fund.........................................154
Real Estate Securities Fund...........................................159
SmallCap Fund.........................................................160
Tax-Exempt Bond Fund..................................................164
Financial Highlights...................................................168
Fund Directors..........................................................190
SHAREHOLDER EXPENSE EXAMPLE
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005
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As a shareholder of the Principal Mutual Funds, you incur two types of costs:
(1) transaction costs, including sales charges on purchase payments; contingent
deferred sales charges; and under certain limited circumstances redemption fees
or exchange fees; and (2) ongoing costs, including management fees; distribution
fees; and other fund expenses. This Example is intended to help you understand
your ongoing costs (in dollars) of investing in Principal Mutual Funds and to
compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the
period and held for the entire period (November 1, 2004 to April 30, 2005).
ACTUAL EXPENSES
The first line of the table below provides information about actual
account values and actual expenses. You may use the information in this
line, together with the amount you invested, to estimate the expenses
that you paid over the period. Simply divide your account value by
$1,000 (for example, an $8,600 account value divided by $1,000 = 8.6),
then multiply the result by the number in the first line under the
heading entitled "Expenses Paid During Period" to estimate the expenses
you paid on your account during this period. An annual fee of $15.00 or
$30.00 may apply to IRA and 403(b) accounts, respectively. These fees
are not included in the table below. If they were, the estimate of
expenses you paid during the period would be higher, and your ending
account value lower, by this amount.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the table below provides information about
hypothetical account values and hypothetical expenses based on each
funds' actual expense ratio and an assumed rate of return of 5% per year
before expenses, which is not the Fund's actual return. The hypothetical
account values and expenses may not be used to estimate the actual
ending account balance or expenses you paid for the period. You may use
this information to compare the ongoing costs of investing in Principal
Mutual Funds and other funds. To do so, compare this 5% hypothetical
example with the 5% hypothetical examples that appear in the shareholder
reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transaction costs, such as sales
charges, redemption fees or exchange fees. Therefore, the second line of the
table is useful in comparing ongoing costs only, and will not help you determine
the relative total costs of owning different funds. In addition, if these
transaction costs were included, your costs would have been higher.
EXPENSES PAID
BEGINNING ENDING DURING PERIOD
ACCOUNT VALUE ACCOUNT VALUE NOVEMBER 1, 2004 ANNUALIZED
NOVEMBER 1, 2004 APRIL 30, 2005 TO APRIL 30, 2005* EXPENSE RATIO
---------------- -------------- ------------------ ---------------
Principal Balanced
Fund, Inc. Class A
Actual $1,000.00 $1,033.90 $ 6.71 1.33%
Hypothetical 1,000.00 1,018.12 6.68 1.33
Principal Balanced
Fund, Inc. Class B
Actual 1,000.00 1,030.10 10.67 2.12
Hypothetical 1,000.00 1,014.15 10.64 2.12
Principal Bond Fund,
Inc. Class A
Actual 1,000.00 1,008.90 5.03 1.01
Hypothetical 1,000.00 1,019.72 5.07 1.01
Principal Bond Fund,
Inc. Class B
Actual 1,000.00 1,005.70 8.16 1.64
Hypothetical 1,000.00 1,016.56 8.23 1.64
Principal Capital
Value Fund, Inc. Class
A
Actual 1,000.00 1,060.40 5.16 1.01
Hypothetical 1,000.00 1,019.72 5.07 1.01
Principal Capital
Value Fund, Inc. Class
B
Actual 1,000.00 1,057.90 7.86 1.54
Hypothetical 1,000.00 1,017.06 7.73 1.54
Principal Cash
Management Fund, Inc.
Class A
Actual $1,000.00 $1,008.60 $ 3.54 0.71%
Hypothetical 1,000.00 1,021.23 3.56 0.71
Principal Cash
Management Fund, Inc.
Class B
Actual 1,000.00 1,006.50 5.57 1.12
Hypothetical 1,000.00 1,019.17 5.62 1.12
Principal Equity
Income Fund, Inc.
Class A
Actual 1,000.00 1,085.40 6.72 1.30
Hypothetical 1,000.00 1,018.27 6.53 1.30
Principal Equity
Income Fund, Inc.
Class B
Actual 1,000.00 1,080.60 10.83 2.10
Hypothetical 1,000.00 1,014.25 10.54 2.10
Principal Government
Securities Income
Fund, Inc. Class A
Actual 1,000.00 1,007.60 4.48 0.90
Hypothetical 1,000.00 1,020.28 4.52 0.90
Principal Government
Securities Income
Fund, Inc. Class B
Actual 1,000.00 1,004.60 8.35 1.68
Hypothetical 1,000.00 1,016.36 8.43 1.68
Principal Growth Fund,
Inc. Class A
Actual 1,000.00 1,039.90 6.17 1.22
Hypothetical 1,000.00 1,018.67 6.12 1.22
Principal Growth Fund,
Inc. Class B
Actual 1,000.00 1,036.20 10.45 2.07
Hypothetical 1,000.00 1,014.40 10.39 2.07
Principal
International Emerging
Markets Fund, Inc.
Class A
Actual 1,000.00 1,153.90 12.82 2.40
Hypothetical 1,000.00 1,012.75 12.05 2.40
Principal
International Emerging
Markets Fund, Inc.
Class B
Actual 1,000.00 1,151.60 16.38 3.07
Hypothetical 1,000.00 1,009.38 15.41 3.07
Principal
International Fund,
Inc. Class A
Actual 1,000.00 1,105.20 7.83 1.50
Hypothetical 1,000.00 1,017.26 7.53 1.50
Principal
International Fund,
Inc. Class B
Actual 1,000.00 1,102.50 9.70 1.86
Hypothetical 1,000.00 1,015.46 9.34 1.86
Principal
International SmallCap
Fund, Inc. Class A
Actual 1,000.00 1,132.30 10.57 2.00
Hypothetical 1,000.00 1,014.75 10.04 2.00
Principal
International SmallCap
Fund, Inc. Class B
Actual 1,000.00 1,128.10 14.51 2.75
Hypothetical 1,000.00 1,010.99 13.81 2.75
Principal LargeCap
Stock Index Fund, Inc.
Class A
Actual 1,000.00 1,028.20 4.53 0.90
Hypothetical 1,000.00 1,020.28 4.52 0.90
Principal Limited Term
Bond Fund, Inc. Class
A
Actual 1,000.00 1,002.30 4.27 0.86
Hypothetical 1,000.00 1,020.48 4.32 0.86
Principal MidCap Fund,
Inc. Class A
Actual 1,000.00 1,040.30 5.16 1.02
Hypothetical 1,000.00 1,019.67 5.12 1.02
Principal MidCap Fund,
Inc. Class B
Actual $1,000.00 $1,039.40 $ 6.52 1.29%
Hypothetical 1,000.00 1,018.32 6.48 1.29
Principal Partners
Blue Chip Fund, Inc.
Class A
Actual 1,000.00 1,030.90 6.70 1.33
Hypothetical 1,000.00 1,018.12 6.68 1.33
Principal Partners
Blue Chip Fund, Inc.
Class B
Actual 1,000.00 1,026.10 10.75 2.14
Hypothetical 1,000.00 1,014.05 10.74 2.14
Principal Partners
Equity Growth Fund,
Inc. Class A
Actual 1,000.00 1,000.00 8.13 1.64
Hypothetical 1,000.00 1,016.56 8.23 1.64
Principal Partners
Equity Growth Fund,
Inc. Class B
Actual 1,000.00 997.10 11.83 2.39
Hypothetical 1,000.00 1,012.80 12.00 2.39
Principal Partners
LargeCap Blend Fund,
Inc. Class A
Actual 1,000.00 1,029.60 7.30 1.45
Hypothetical 1,000.00 1,017.51 7.28 1.45
Principal Partners
LargeCap Blend Fund,
Inc. Class B
Actual 1,000.00 1,025.50 11.05 2.20
Hypothetical 1,000.00 1,013.75 11.04 2.20
Principal Partners
LargeCap Value Fund,
Inc. Class A
Actual 1,000.00 1,046.30 7.36 1.45
Hypothetical 1,000.00 1,017.51 7.28 1.45
Principal Partners
LargeCap Value Fund,
Inc. Class B
Actual 1,000.00 1,041.90 11.14 2.20
Hypothetical 1,000.00 1,013.75 11.04 2.20
Principal Partners
MidCap Growth Fund,
Inc. Class A
Actual 1,000.00 1,035.00 8.83 1.75
Hypothetical 1,000.00 1,016.01 8.79 1.75
Principal Partners
MidCap Growth Fund,
Inc. Class B
Actual 1,000.00 1,031.90 12.59 2.50
Hypothetical 1,000.00 1,012.24 12.55 2.50
Principal Partners
SmallCap Growth Fund,
Inc. Class A
Actual 1,000.00 1,005.40 9.70 1.95
Hypothetical 1,000.00 1,015.00 9.79 1.95
Principal Partners
SmallCap Growth Fund,
Inc. Class B
Actual 1,000.00 1,001.90 13.40 2.70
Hypothetical 1,000.00 1,011.24 13.56 2.70
Principal Real Estate
Securities Fund, Inc.
Class A
Actual 1,000.00 1,084.30 8.32 1.61
Hypothetical 1,000.00 1,016.71 8.08 1.61
Principal Real Estate
Securities Fund, Inc.
Class B
Actual 1,000.00 1,079.70 12.07 2.34
Hypothetical 1,000.00 1,013.05 11.75 2.34
Principal SmallCap
Fund, Inc. Class A
Actual 1,000.00 1,048.00 8.28 1.63
Hypothetical 1,000.00 1,016.61 8.18 1.63
Principal SmallCap
Fund, Inc. Class B
Actual 1,000.00 1,044.90 11.92 2.35
Hypothetical 1,000.00 1,013.00 11.80 2.35
Principal Tax-Exempt
Bond Fund, Inc. Class
A
Actual $1,000.00 $1,012.80 $ 3.94 0.79%
Hypothetical 1,000.00 1,020.83 3.97 0.79
Principal Tax-Exempt
Bond Fund, Inc. Class
B
Actual 1,000.00 1,010.60 6.03 1.21
Hypothetical 1,000.00 1,018.72 6.07 1.21
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*Expenses are equal to a fund's annualized expense ratio multiplied by the
average account value over the period, multiplied by 181/365 (to reflect the
one-half year period).
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
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PRINCIPAL PRINCIPAL
BALANCED BOND
FUND, INC. FUND, INC.
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INVESTMENT IN SECURITIES--AT COST ......... $104,640,029 $228,304,747
============ ============
ASSETS
Investment in securities--at value......... $106,239,482/(c)/ $230,901,871
Cash....................................... 313,372 798,741
Receivables:
Capital Shares sold....................... 43,545 646,056
Dividends and interest.................... 451,499 2,047,286
Investment securities sold................ 2,163,544 14,615,731
Litigation................................ 66,339 78,615
Unrealized gain on swap agreements........ -- 95,351
Other assets............................... 5,462 8,396
Prepaid directors' expenses................ 623 781
------------ ------------
Total Assets 109,283,866 249,192,828
LIABILITIES
Accrued management and investment advisory
fees...................................... 8,376 13,336
Accrued distribution fees.................. 4,215 7,819
Accrued transfer and administrative fees... 46,153 58,401
Accrued other expenses..................... 74,456 75,890
Payables:
Capital Shares reacquired................. 58,290 202,335
Dividends payable......................... -- 806,080
Investment securities purchased........... 6,921,800 42,459,688
Unrealized loss on swap agreements........ -- 681
Collateral obligation on securities loaned,
at value.................................. 177,500 --
------------ ------------
Total Liabilities 7,290,790 43,624,230
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NET ASSETS APPLICABLE TO OUTSTANDING SHARES $101,993,076 $205,568,598
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital........................... $109,267,539 $214,260,194
Accumulated undistributed (overdistributed)
net investment income (operating loss).... 28,126 (798,075)
Accumulated undistributed (overdistributed)
net realized gain (loss).................. (8,902,042) (10,585,315)
Net unrealized appreciation (depreciation)
of investments............................ 1,599,453 2,691,794
------------ ------------
Total Net Assets $101,993,076 $205,568,598
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A SHARE):
Shares authorized.......................... 100,000,000 200,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets........................ $ 86,630,372 $175,099,189
Shares issued and outstanding............ 6,722,992 15,952,632
Net asset value per share................ $ 12.89 $ 10.98
Maximum offering price per share /(a)/ .. $ 13.68 $ 11.53
============ ============
Class B: Net Assets........................ $ 15,362,704 $ 30,469,409
Shares issued and outstanding............ 1,199,225 2,775,859
Net asset value per share /(b)/ ......... $ 12.81 $ 10.98
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value for
Principal Balanced Fund, Inc. and 4.75% of the offering price or 4.99% of the
net asset value for Principal Bond Fund, Inc.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
/(c) /Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements.
See accompanying notes.
6
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
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PRINCIPAL PRINCIPAL
CAPITAL VALUE CASH MANAGEMENT
FUND, INC. FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ........... $305,952,252 $ 336,396,848
============ ==============
ASSETS
Investment in securities--at value........... $330,171,030 $ 336,396,848
Cash......................................... 10,000 11,681
Receivables:
Capital Shares sold......................... 12,211 18,147
Dividends and interest...................... 448,483 166,161
Investment securities sold.................. 555,820 --
Variation margin on futures contracts....... 45,650 --
Other assets................................. 30,572 28,300
Prepaid directors' expenses.................. 1,337 1,973
------------ --------------
Total Assets 331,275,103 336,623,110
LIABILITIES
Accrued management and investment advisory
fees........................................ 26,632 20,612
Accrued distribution fees.................... 7,362 99
Accrued transfer and administrative fees..... 90,639 96,511
Accrued other expenses....................... 121,253 132,259
Payables:
Capital Shares reacquired................... 160,342 1,505,543
------------ --------------
Total Liabilities 406,228 1,755,024
------------ --------------
NET ASSETS APPLICABLE TO OUTSTANDING SHARES . $330,868,875 $ 334,868,086
============ ==============
NET ASSETS CONSIST OF:
Capital Shares and additional paid-in-capital $296,499,348 $ 334,868,086
Accumulated undistributed (overdistributed)
net investment income (operating loss)...... 1,170,283 --
Accumulated undistributed (overdistributed)
net realized gain (loss).................... 9,075,566 --
Net unrealized appreciation (depreciation) of
investments................................. 24,123,678 --
------------ --------------
Total Net Assets $330,868,875 $ 334,868,086
============ ==============
CAPITAL STOCK (PAR VALUE: $.01 A SHARE):
Shares authorized............................ 100,000,000 2,000,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.......................... $304,081,265 $ 330,901,651
Shares issued and outstanding.............. 12,279,727 330,901,651
Net asset value per share.................. $ 24.76 $ 1.000
Maximum offering price per share /(a)/ .... $ 26.27 $ 1.000
============ ==============
Class B: Net Assets.......................... $ 26,787,610 $ 3,966,435
Shares issued and outstanding.............. 1,088,316 3,966,435
Net asset value per share /(b)/ ........... $ 24.61 $ 1.000
============ ==============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value for
Principal Capital Value Fund, Inc. No front-end sales charge applies to
Principal Cash Management Fund, Inc.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
See accompanying notes.
7
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
EQUITY INCOME GOVERNMENT SECURITIES
FUND, INC. INCOME FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ..... $ 87,713,751 $413,769,354
============ ============
ASSETS
Investment in securities--at value..... $ 93,019,717 $415,265,701
Cash................................... 481,837 18,470
Receivables:
Capital Shares sold................... 7,485 664,916
Dividends and interest................ 407,166 1,453,958
Expense reimbursement from Manager.... 166 --
Investment securities sold............ -- 5,918,438
Other assets........................... 1,986 20,979
Prepaid directors' expenses............ 794 1,323
------------ ------------
Total Assets 93,919,151 423,343,785
LIABILITIES
Accrued management and investment
advisory fees......................... 7,679 19,093
Accrued distribution fees.............. 4,254 14,181
Accrued transfer and administrative
fees.................................. 23,349 66,456
Accrued other expenses................. 31,597 90,371
Payables:
Capital Shares reacquired............. 28,852 233,550
Dividends Payable..................... -- 893,239
Investment securities purchased....... -- 109,852,086
------------ ------------
Total Liabilities 95,731 111,168,976
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................... $ 93,823,420 $312,174,809
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital....................... $108,838,483 $318,082,553
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............... 272,357 5,638
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................ (20,593,630) (7,409,729)
Net unrealized appreciation
(depreciation) of investments......... 5,305,966 1,496,347
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies............................ 244 --
------------ ------------
Total Net Assets $ 93,823,420 $312,174,809
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized...................... 100,000,000 125,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................... $ 81,049,072 $259,592,656
Shares issued and outstanding........ 7,445,477 23,046,545
Net asset value per share............ $ 10.89 $ 11.26
Maximum offering price per share
/(a)/ ................................ $ 11.55 $ 11.82
============ ============
Class B: Net Assets.................... $ 12,774,348 $ 52,582,153
Shares issued and outstanding........ 1,178,170 4,696,138
Net asset value per share /(b)/ ..... $ 10.84 $ 11.20
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value for
Principal Equity Income Fund, Inc. and 4.75% of the offering price or 4.99% of
the net asset value for Principal Government Securities Income Fund, Inc.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
See accompanying notes.
8
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
GROWTH INTERNATIONAL EMERGING
FUND, INC. MARKETS FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ... $ 281,621,715 $ 49,359,308
============= ============
FOREIGN CURRENCY--AT COST ........... $ -- $ 275,117
============= ============
ASSETS
Investment in securities--at value... $282,551,124// $53,237,188/(c)/
Foreign currency--at value........... -- 275,904
Cash................................. 9,361 53,662
Receivables:
Capital Shares sold................. 6,200 2,111
Dividends and interest.............. 124,500 189,160
Investment securities sold.......... 6,471,828 1,577,980
Other assets......................... 14,552 497
Prepaid directors' expenses.......... 1,191 407
------------- ------------
Total Assets 289,178,756 55,336,909
LIABILITIES
Accrued management and investment
advisory fees....................... 23,575 9,266
Accrued distribution fees............ 11,179 2,437
Accrued transfer and administrative
fees................................ 141,662 12,396
Accrued other expenses............... 170,746 71,310
Payables:
Capital Shares reacquired........... 305,223 9,371
Investment securities purchased..... 602,529 450,192
Collateral obligation on securities
loaned, at value.................... -- 1,068,543
------------- ------------
Total Liabilities 1,254,914 1,623,515
------------- ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................. $ 287,923,842 $ 53,713,394
============= ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital..................... $ 454,886,844 $ 40,700,053
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............. 702,946 75,328
Accumulated undistributed
(overdistributed) net realized gain
(loss).............................. (168,595,357) 9,058,203
Net unrealized appreciation
(depreciation) of investments....... 929,409 3,877,880
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies.......................... -- 1,930
------------- ------------
Total Net Assets $ 287,923,842 $ 53,713,394
============= ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized.................... 200,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................. $ 250,482,525 $ 46,017,531
Shares issued and outstanding...... 9,154,320 3,535,967
Net asset value per share.......... $ 27.36 $ 13.01
Maximum offering price per share
/(a)/ .............................. $ 29.03 $ 13.80
============= ============
Class B: Net Assets.................. $ 37,441,317 $ 7,695,863
Shares issued and outstanding...... 1,438,336 623,360
Net asset value per share /(b)/ ... $ 26.03 $ 12.35
============= ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
/(c) /Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements.
See accompanying notes.
9
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
INTERNATIONAL INTERNATIONAL
FUND, INC. SMALLCAP FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ... $268,231,781 $ 71,644,504
============ ============
FOREIGN CURRENCY--AT COST ........... $ 125,726 $ --
============ ============
ASSETS
Investment in securities--at value... $292,107,791/(c)/ $83,613,326/(c)/
Foreign currency--at value........... 126,043 --
Cash................................. 240,368 20,323
Receivables:
Capital Shares sold................. 38,732 59,851
Dividends and interest.............. 1,337,621 284,044
Expense reimbursement from Manager.. -- 5,874
Foreign tax refund.................. 378 --
Investment securities sold.......... 3,920,309 617,584
Other assets......................... 6,039 816
Prepaid directors' expenses.......... 1,627 607
------------ ------------
Total Assets 297,778,908 84,602,425
LIABILITIES
Accrued management and investment
advisory fees....................... 29,315 12,034
Accrued distribution fees............ 6,072 3,921
Accrued transfer and administrative
fees................................ 84,202 25,540
Accrued other expenses............... 175,485 88,911
Payables:
Capital Shares reacquired........... 141,607 2,442
Deferred foreign tax................ 291 --
Investment securities purchased..... 2,646,593 411,897
Collateral obligation on securities
loaned, at value.................... 44,462,316 11,553,369
------------ ------------
Total Liabilities 47,545,881 12,098,114
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................. $250,233,027 $ 72,504,311
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital..................... $277,400,568 $ 57,707,539
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............. 997,890 (92,381)
Accumulated undistributed
(overdistributed) net realized gain
(loss).............................. (52,027,099) 2,922,879
Net unrealized appreciation
(depreciation) of investments....... 23,875,719 11,968,822
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies.......................... (14,051) (2,548)
------------ ------------
Total Net Assets $250,233,027 $ 72,504,311
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized.................... 325,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................. $222,630,466 $ 57,240,011
Shares issued and outstanding...... 28,280,119 3,393,408
Net asset value per share.......... $ 7.87 $ 16.87
Maximum offering price per share
/(a)/ .............................. $ 8.35 $ 17.90
============ ============
Class B: Net Assets.................. $ 27,602,561 $ 15,264,300
Shares issued and outstanding...... 3,568,581 957,348
Net asset value per share /(b)/ ... $ 7.73 $ 15.94
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
/(c) /Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements.
/ /
See accompanying notes.
10
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
LARGECAP STOCK LIMITED TERM
INDEX FUND, INC. BOND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Investment in affiliated securities--at
cost.................................... $ 55,309 $ --
Investment in securities--at cost........ 72,766,206 134,376,621
------------ ------------
TOTAL INVESTMENTS--AT COST .............. $ 72,821,515 $134,376,621
============ ============
ASSETS
Investment in affiliated securities--at
value................................... $ 74,135 $ --
Investment in securities--at value....... 69,496,096/(b)/ 133,586,741/(b)/
Cash..................................... 10,330 11,808
Receivables:
Capital Shares sold..................... 642 954,256
Dividends and interest.................. 84,516 1,092,189
Expense reimbursement from Manager...... 2,267 --
Investment securities sold.............. 42,606 467,944
Litigation.............................. -- 404,842
Unrealized gain on swap agreements...... -- 86,481
Variation margin on futures contracts... 19,250 --
Other assets............................. 793 1,189
Prepaid directors' expenses.............. 465 839
------------ ------------
Total Assets 69,731,100 136,606,289
LIABILITIES
Accrued management and investment
advisory fees........................... 3,311 8,761
Accrued distribution fees................ 1,419 2,692
Accrued transfer and administrative fees. 17,887 16,087
Accrued other expenses................... 33,604 7,361
Payables:
Capital Shares reacquired............... 199,011 219,616
Dividends payable....................... -- 523,097
Investment securities purchased......... 68,600 4,876,737
Collateral obligation on securities
loaned, at value........................ 282,000 158,360
------------ ------------
Total Liabilities 605,832 5,812,711
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ................................. $ 69,125,268 $130,793,578
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital......................... $ 74,585,570 $136,895,853
Accumulated undistributed
(overdistributed) net investment income
(operating loss)........................ 193,292 (1,052,165)
Accumulated undistributed
(overdistributed) net realized gain
(loss).................................. (2,338,285) (4,346,711)
Net unrealized appreciation
(depreciation) of investments........... (3,315,309) (703,399)
------------ ------------
Total Net Assets $ 69,125,268 $130,793,578
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A SHARE):
Shares authorized........................ 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets...................... $ 69,125,268 $130,793,578
Shares issued and outstanding.......... 8,096,614 13,997,852
Net asset value per share.............. $ 8.54 $ 9.34
Maximum offering price per share /(a)/ $ 8.67 $ 9.48
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 1.50% of the offering price or 1.52% of the net asset value.
/(b) /Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements.
See accompanying notes.
11
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
MIDCAP PARTNERS BLUE
FUND, INC. CHIP FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ........ $467,794,128 $145,691,499
============ ============
ASSETS
Investment in securities--at value........ $550,867,484// $147,785,818/(c)/
Cash...................................... 10,000 612,334
Receivables:
Capital Shares sold...................... 187,193 3,126
Dividends and interest................... 240,049 168,271
Investment securities sold............... 2,260,958 416,041
Other assets.............................. 9,513 3,372
Prepaid directors' expenses............... 3,997 874
------------ ------------
Total Assets 553,579,194 148,989,836
LIABILITIES
Accrued management and investment advisory
fees..................................... 40,863 12,162
Accrued distribution fees................. 15,365 6,557
Accrued transfer and administrative fees.. 141,173 77,278
Accrued other expenses.................... 174,279 97,088
Payables:
Capital Shares reacquired................ 293,184 188,626
Investment securities purchased.......... 2,646,398 367,370
Collateral obligation on securities
loaned, at value......................... -- 508,000
------------ ------------
Total Liabilities 3,311,262 1,257,081
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES .................................. $550,267,932 $147,732,755
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital.......................... $430,648,428 $165,842,481
Accumulated undistributed
(overdistributed) net investment income
(operating loss)......................... 2,583,206 110,109
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................... 33,962,942 (20,306,094)
Net unrealized appreciation (depreciation)
of investments........................... 83,073,356 2,086,259
------------ ------------
Total Net Assets $550,267,932 $147,732,755
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A SHARE):
Shares authorized......................... 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets....................... $477,079,755 $123,559,916
Shares issued and outstanding........... 11,772,673 6,870,036
Net asset value per share............... $ 40.52 $ 17.99
Maximum offering price per share /(a)/ . $ 42.99 $ 19.09
============ ============
Class B: Net Assets....................... $ 73,188,177 $ 24,172,839
Shares issued and outstanding........... 1,903,136 1,399,547
Net asset value per share /(b)/ ........ $ 38.46 $ 17.27
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
/(c) /Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements.
See accompanying notes.
12
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS EQUITY PARTNERS LARGECAP
GROWTH FUND, INC. BLEND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ..... $ 60,878,995 $ 65,617,806
============ ============
ASSETS
Investment in securities--at value..... $ 58,607,689 $ 69,239,967
Cash................................... 516,900 569,338
Receivables:
Capital Shares sold................... 25,085 47,875
Dividends and interest................ 20,331 65,684
Expense reimbursement from Manager.... 745 1,387
Investment securities sold............ 540,282 290,464
Variation margin on futures contracts. -- 7,700
Other assets........................... 964 501
Prepaid directors' expenses............ 280 543
------------ ------------
Total Assets 59,712,276 70,223,459
LIABILITIES
Accrued management and investment
advisory fees......................... 6,072 7,149
Accrued distribution fees.............. 3,357 4,341
Accrued transfer and administrative
fees.................................. 38,367 16,760
Accrued other expenses................. 57,310 24,114
Payables:
Capital Shares reacquired............. 11,812 16,040
Investment securities purchased....... 351,762 334,097
------------ ------------
Total Liabilities 468,680 402,501
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................... $ 59,243,596 $ 69,820,958
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital....................... $ 88,602,575 $ 65,337,419
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............... 15,098 (12,589)
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................ (27,102,771) 902,012
Net unrealized appreciation
(depreciation) of investments......... (2,271,306) 3,594,116
------------ ------------
Total Net Assets $ 59,243,596 $ 69,820,958
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized...................... 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................... $ 44,683,808 $ 48,396,556
Shares issued and outstanding........ 6,170,538 4,921,163
Net asset value per share............ $ 7.24 $ 9.83
Maximum offering price per share
/(a)/ ................................ $ 7.68 $ 10.43
============ ============
Class B: Net Assets.................... $ 14,559,788 $ 21,424,402
Shares issued and outstanding........ 2,093,766 2,240,114
Net asset value per share /(b)/ ..... $ 6.95 $ 9.56
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
See accompanying notes.
13
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS LARGECAP PARTNERS MIDCAP
VALUE FUND, INC. GROWTH FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ..... $ 59,322,546 $ 28,859,675
============ ============
ASSETS
Investment in securities--at value..... $ 67,770,368 $ 32,144,729
Cash................................... 1,189,802 339,298
Receivables:
Capital Shares sold................... 30,611 --
Dividends and interest................ 95,642 5,923
Expense reimbursement from Manager.... 852 940
Investment securities sold............ -- 176,252
Other assets........................... 517 582
Prepaid directors' expenses............ 324 --
------------ ------------
Total Assets 69,088,116 32,667,724
LIABILITIES
Accrued management and investment
advisory fees......................... 7,050 4,048
Accrued distribution fees.............. 4,137 2,021
Accrued transfer and administrative
fees.................................. 15,000 23,983
Accrued other expenses................. 34,093 24,104
Payables:
Capital Shares reacquired............. 55,331 8,167
Investment securities purchased....... 157,541 87,788
------------ ------------
Total Liabilities 273,152 150,111
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................... $ 68,814,964 $ 32,517,613
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital....................... $ 58,764,393 $ 39,673,891
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............... 116,584 (271,098)
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................ 1,486,165 (10,170,234)
Net unrealized appreciation
(depreciation) of investments......... 8,447,822 3,285,054
------------ ------------
Total Net Assets $ 68,814,964 $ 32,517,613
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized...................... 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................... $ 48,958,589 $ 22,839,426
Shares issued and outstanding........ 3,937,190 4,287,675
Net asset value per share............ $ 12.43 $ 5.33
Maximum offering price per share
/(a)/ ................................ $ 13.19 $ 5.66
============ ============
Class B: Net Assets.................... $ 19,856,375 $ 9,678,187
Shares issued and outstanding........ 1,617,647 1,872,781
Net asset value per share /(b)/ ..... $ 12.27 $ 5.17
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
See accompanying notes.
14
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS SMALLCAP REAL ESTATE
GROWTH FUND, INC. SECURITIES FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST . $ 16,714,195 $ 69,179,698
============ ============
ASSETS
Investment in securities--at value. $ 19,201,438 $ 92,562,966
Cash............................... 971,836 10,001
Receivables:
Capital Shares sold............... 7,262 15,732
Dividends and interest............ 4,667 63,184
Expense reimbursement from Manager 661 --
Investment securities sold........ 2,876 178,234
Other assets....................... 205 659
Prepaid directors' expenses........ 212 819
------------ ------------
Total Assets 20,189,157 92,831,595
LIABILITIES
Accrued management and investment
advisory fees..................... 2,500 11,233
Accrued distribution fees.......... 1,294 5,034
Accrued transfer and administrative
fees.............................. 11,925 7,996
Accrued other expenses............. 12,507 40,601
Payables:
Capital Shares reacquired......... -- 200,932
Investment securities purchased... 60,255 --
------------ ------------
Total Liabilities 88,481 265,796
------------ ------------
NET ASSETS APPLICABLE TO
OUTSTANDING SHARES................ $ 20,100,676 $ 92,565,799
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital................... $ 21,995,489 $ 67,806,368
Accumulated undistributed
(overdistributed) net investment
income (operating loss)........... (197,641) (26,781)
Accumulated undistributed
(overdistributed) net realized
gain (loss)....................... (4,184,415) 1,402,944
Net unrealized appreciation
(depreciation) of investments..... 2,487,243 23,383,268
------------ ------------
Total Net Assets $ 20,100,676 $ 92,565,799
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized.................. 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets................ $ 13,410,111 $ 71,350,972
Shares issued and outstanding.... 2,406,578 4,578,182
Net asset value per share........ $ 5.57 $ 15.59
Maximum offering price per share
/(a)/ ............................ $ 5.91 $ 16.54
============ ============
Class B: Net Assets................ $ 6,690,565 $ 21,214,827
Shares issued and outstanding.... 1,241,099 1,371,074
Net asset value per share /(b)/ . $ 5.39 $ 15.47
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
See accompanying notes.
15
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
SMALLCAP TAX-EXEMPT
FUND, INC. BOND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ....... $119,094,513 $164,147,355
============ ============
ASSETS
Investment in securities--at value....... $123,091,706/(c)/ $168,614,230
Cash..................................... 10,010 65,762
Receivables:
Capital Shares sold..................... 12,520 368,220
Dividends and interest.................. 25,452 2,437,745
Investment securities sold.............. -- 2,239,960
Other assets............................. 1,614 9,829
Prepaid directors' expenses.............. 739 854
------------ ------------
Total Assets 123,142,041 173,736,600
LIABILITIES
Accrued management and investment
advisory fees........................... 12,997 10,933
Accrued distribution fees................ 6,040 5,341
Accrued transfer and administrative fees. 51,945 18,866
Accrued other expenses................... 75,528 11,487
Payables:
Capital Shares reacquired............... 22,677 171,179
Dividends Payable....................... -- 498,266
Investment securities purchased......... 2,111,825 2,822,229
Collateral obligation on securities
loaned, at value........................ 9,850,000 --
------------ ------------
Total Liabilities 12,131,012 3,538,301
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ................................. $111,011,029 $170,198,299
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital......................... $117,059,497 $163,268,781
Accumulated undistributed
(overdistributed) net investment income
(operating loss)........................ (395,083) 502,089
Accumulated undistributed
(overdistributed) net realized gain
(loss).................................. (9,650,578) 1,960,554
Net unrealized appreciation
(depreciation) of investments........... 3,997,193 4,466,875
------------ ------------
Total Net Assets $111,011,029 $170,198,299
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A SHARE):
Shares authorized........................ 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets...................... $ 86,089,585 $161,389,148
Shares issued and outstanding.......... 8,961,435 13,226,761
Net asset value per share.............. $ 9.61 $ 12.20
Maximum offering price per share /(a)/ $ 10.20 $ 12.81
============ ============
Class B: Net Assets...................... $ 24,921,444 $ 8,809,151
Shares issued and outstanding.......... 2,748,740 717,744
Net asset value per share /(b)/ ....... $ 9.07 $ 12.27
============ ============
/(a) /Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value for
Principal SmallCap Fund, Inc. and 4.75% of the offering price or 4.99% of the
net asset value for Principal Tax-Exempt Bond Fund, Inc.
/(b) /Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
/(c) /Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements.
See accompanying notes.
16
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
BALANCED BOND
FUND, INC. FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends........................................ $ 716,866 $ --
Interest......................................... 852,590 4,832,719
Securities lending............................... 1,085 1,258
---------- -----------
Total Income 1,570,541 4,833,977
Expenses:
Management and investment advisory fees.......... 306,499 483,925
Distribution fees - Class A...................... 83,926 198,311
Distribution fees - Class B...................... 68,614 115,866
Registration fees - Class A...................... 3,982 4,889
Registration fees - Class B...................... 4,559 4,595
Shareholder meeting expense - Class A............ 2,352 --
Shareholder meeting expense - Class B............ 473 --
Shareholder reports - Class A.................... 6,604 7,896
Shareholder reports - Class B.................... 1,410 2,428
Transfer and administrative fees - Class A....... 47,017 62,988
Transfer and administrative fees - Class B....... 10,713 19,960
Auditing and legal fees.......................... 4,717 6,225
Custodian fees................................... 31,391 7,926
Directors' expenses.............................. 1,505 3,211
Registration fees................................ 14,879 18,238
Shareholder meeting expense...................... 34,131 42,651
Transfer and administrative fees................. 115,182 149,976
Other expenses................................... 3,330 6,173
---------- -----------
Total Expenses 741,284 1,135,258
---------- -----------
Net Investment Income (Operating Loss) 829,257 3,698,719
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions.......................... 2,835,500 683,811
Swap agreements.................................. -- (100,910)
Change in unrealized appreciation/depreciation of:
Investments...................................... (278,410) (2,577,662)
Swap agreements.................................. -- 37,110
---------- -----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 2,557,090 (1,957,651)
---------- -----------
Net Increase (Decrease) in Net Assets Resulting
from Operations $3,386,347 $ 1,741,068
========== ===========
See accompanying notes.
17
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
CAPITAL VALUE CASH MANAGEMENT
FUND, INC. FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends................................... $ 4,080,520 $ --
Interest.................................... 48,358 3,988,629
Securities lending.......................... 6,497 --
----------- ----------
Total Income 4,135,375 3,988,629
Expenses:
Management and investment advisory fees..... 996,133 723,707
Distribution fees - Class A................. 223,295 --
Distribution fees - Class B................. 75,888 5,075
Registration fees - Class A................. 7,284 16,688
Registration fees - Class B................. 4,648 4,096
Shareholder meeting expense - Class A....... 7,336 6,433
Shareholder meeting expense - Class B....... 1,313 --
Shareholder reports - Class A.............. 14,612 12,972
Shareholder reports - Class B.............. 2,735 220
Transfer and administrative fees - Class A.. 105,152 156,106
Transfer and administrative fees - Class B.. 19,561 1,935
Auditing and legal fees..................... 5,086 4,914
Custodian fees.............................. 6,234 5,171
Directors' expenses......................... 5,169 4,862
Registration fees........................... 16,197 21,198
Shareholder meeting expense................. 70,515 52,913
Transfer and administrative fees............ 216,219 156,514
Other expenses.............................. 9,729 7,525
----------- ----------
Total Expenses 1,787,106 1,180,329
----------- ----------
Net Investment Income (Operating Loss) 2,348,269 2,808,300
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions..................... 13,194,448 --
Futures contracts........................... 282,414 --
Change in unrealized
appreciation/depreciation of:
Investments................................. 4,756,770 --
Futures contracts........................... (59,105) --
----------- ----------
Net Realized and Unrealized Gain on
Investments and Foreign Currencies 18,174,527 --
----------- ----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $20,522,796 $2,808,300
=========== ==========
See accompanying notes.
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
EQUITY INCOME GOVERNMENT SECURITIES
FUND, INC. INCOME FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................. $2,100,569 $ --
Withholding tax on foreign dividends.. (64,452) --
Interest.............................. 206,012 6,422,271
Securities lending.................... -- 7,248
---------- -----------
Total Income 2,242,129 6,429,519
Expenses:
Management and investment advisory
fees................................. 263,040 699,804
Distribution fees - Class A........... 90,746 281,460
Distribution fees - Class B........... 56,531 243,204
Registration fees - Class A........... 5,899 7,891
Registration fees - Class B........... 5,100 6,321
Shareholder meeting expense - Class A. 2,494 4,796
Shareholder meeting expense - Class B. 638 1,447
Shareholder reports - Class A......... 5,244 9,728
Shareholder reports - Class B......... 1,390 3,021
Transfer and administrative fees -
Class A.............................. 37,955 71,867
Transfer and administrative fees -
Class B.............................. 10,379 23,535
Auditing and legal fees............... 3,659 6,389
Custodian fees........................ 5,114 7,681
Directors' expenses................... 1,074 4,780
Registration fees..................... 10,874 19,372
Shareholder meeting expense........... 25,148 50,616
Transfer and administrative fees...... 93,345 175,701
Other expenses........................ 1,759 12,007
---------- -----------
Total Gross Expenses 620,389 1,629,620
Less: Reimbursement from Manager -
Class B.............................. 1,839 --
---------- -----------
Total Net Expenses 618,550 1,629,620
---------- -----------
Net Investment Income (Operating Loss) 1,623,579 4,799,899
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions............... 3,662,693 868,293
Foreign currency transactions......... (1,475) --
Change in unrealized
appreciation/depreciation of:
Investments........................... 1,582,262 (3,421,050)
Translation of assets and liabilities
in foreign currencies................ (1) --
---------- -----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies 5,243,479 (2,552,757)
---------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $6,867,058 $ 2,247,142
========== ===========
See accompanying notes.
19
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
GROWTH INTERNATIONAL EMERGING
FUND, INC. MARKETS FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends.............................. $ 2,646,100 $ 886,476
Withholding tax on foreign dividends... -- (96,927)
Interest............................... 52,895 3,355
Securities lending..................... 3,401 893
----------- -----------
Total Income 2,702,396 793,797
Expenses:
Management and investment advisory fees 882,893 317,091
Distribution fees - Class A............ 229,929 52,908
Distribution fees - Class B............ 184,292 31,351
Registration fees - Class A............ 6,450 4,205
Registration fees - Class B............ 4,242 3,618
Shareholder meeting expense - Class A.. 11,064 29,849
Shareholder meeting expense - Class B.. 2,362 431
Shareholder reports - Class A.......... 21,797 2,594
Shareholder reports - Class B.......... 4,994 845
Transfer and administrative fees -
Class A............................... 161,217 18,830
Transfer and administrative fees -
Class B............................... 39,824 6,276
Auditing and legal fees................ 4,989 5,601
Custodian fees......................... 2,513 72,204
Directors' expenses.................... 5,001 607
Registration fees...................... 19,964 12,022
Shareholder meeting expense............ 110,707 13,850
Transfer and administrative fees....... 298,832 59,251
Other expenses......................... 8,380 3,351
----------- -----------
Total Gross Expenses 1,999,450 634,884
Less: Fees paid indirectly............. -- 2,266
----------- -----------
Total Net Expenses 1,999,450 632,618
----------- -----------
Net Investment Income (Operating Loss) 702,946 161,179
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions................ 1,042,241 9,090,473
Foreign currency transactions.......... -- (85,852)
Change in unrealized
appreciation/depreciation of:
Investments............................ 10,246,546 (2,479,323)
Translation of assets and liabilities
in foreign currencies................. -- 2,220
----------- -----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies 11,288,787 6,527,518
----------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $11,991,733 $ 6,688,697
=========== ===========
See accompanying notes.
20
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
INTERNATIONAL INTERNATIONAL
FUND, INC. SMALLCAP FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................... $ 3,696,429 $ 761,954
Withholding tax on foreign dividends.... (423,035) (78,106)
Interest................................ 28,061 10,822
Securities lending...................... 67,968 36,388
----------- ----------
Total Income 3,369,423 731,058
Expenses:
Management and investment advisory fees. 1,073,677 415,527
Distribution fees - Class A............. 175,202 68,026
Distribution fees - Class B............. 60,386 68,052
Registration fees - Class A............. 5,095 2,379
Registration fees - Class B............. 4,748 3,218
Shareholder meeting expense - Class A... 35,823 30,771
Shareholder meeting expense - Class B... 1,131 787
Shareholder reports - Class A........... 14,060 4,368
Shareholder reports - Class B........... 2,923 1,582
Transfer and administrative fees - Class
A...................................... 105,457 32,218
Transfer and administrative fees - Class
B...................................... 23,631 11,861
Auditing and legal fees................. 6,564 5,147
Custodian fees.......................... 135,455 41,390
Directors' expenses..................... 3,564 809
Registration fees....................... 12,733 12,978
Shareholder meeting expense............. 71,212 24,104
Transfer and administrative fees........ 203,014 88,625
Other expenses.......................... 11,724 1,704
----------- ----------
Total Gross Expenses 1,946,399 813,546
Less: Fees paid indirectly.............. 1,375 2,594
Less: Reimbursement from Manager - Class
A...................................... -- 54,547
Less: Reimbursement from Manager - Class
B...................................... -- 7,121
----------- ----------
Total Net Expenses 1,945,024 749,284
----------- ----------
Net Investment Income (Operating Loss) 1,424,399 (18,226)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions (net of foreign
taxes of $280 and $0, respectively).... 22,808,414 6,370,645
Foreign currency transactions........... (49,670) (4,993)
Change in unrealized
appreciation/depreciation of:
Investments (net of deferred foreign tax
payable of $291 and $0, respectively).. 882,191 1,618,652
Translation of assets and liabilities in
foreign currencies..................... (3,176) (2,351)
----------- ----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies 23,637,759 7,981,953
----------- ----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $25,062,158 $7,963,727
=========== ==========
See accompanying notes.
21
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
LARGECAP STOCK LIMITED TERM
INDEX FUND, INC. BOND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends from affiliates................ $ 1,036 $ --
Dividends................................ 813,356 --
Interest................................. 17,804 2,432,272
Securities lending....................... 1,796 1,689
---------- -----------
Total Income 833,992 2,433,961
Expenses:
Management and investment advisory fees.. 120,905 325,673
Distribution fees - Class A.............. 44,992 91,703
Distribution fees - Class B /(a)/ ....... 21,222 26,386
Registration fees - Class A.............. 5,671 10,994
Registration fees - Class B /(a)/ ....... 2,971 3,163
Shareholder meeting expense - Class A.... 2,509 1,623
Shareholder reports - Class A............ 3,971 2,628
Shareholder reports - Class B /(a)/ ..... -- 41
Transfer and administrative fees - Class
A....................................... 30,163 22,764
Transfer and administrative fees - Class
B /(a)/................................. 10,869 7,490
Auditing and legal fees.................. 4,053 4,731
Custodian fees........................... 10,297 5,377
Directors' expenses...................... 972 2,016
Registration fees........................ 10,805 16,766
Shareholder meeting expense.............. 20,151 13,127
Transfer and administrative fees......... 83,562 62,528
Other expenses........................... 1,798 3,165
---------- -----------
Total Gross Expenses 374,911 600,175
Less: Reimbursement from Manager - Class
A....................................... 35,823 --
Less: Reimbursement from Manager - Class
B /(a)/................................. 11,909 --
---------- -----------
Total Net Expenses 327,179 600,175
---------- -----------
Net Investment Income (Operating Loss) 506,813 1,833,786
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions.................. 78,033 (27,595)
Futures contracts........................ 117,270 --
Swap agreements.......................... -- (98,682)
Change in unrealized
appreciation/depreciation of:
Investments.............................. 1,160,311 (1,510,760)
Investments in affiliates................ 2,995 --
Futures contracts........................ (71,150) --
Swap agreements.......................... -- 86,481
---------- -----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 1,287,459 (1,550,556)
---------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $1,794,272 $ 283,230
========== ===========
/(a)/ Period from November 1, 2004 through February 28, 2005, discontinuation
of class.
See accompanying notes.
22
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
MIDCAP PARTNERS BLUE
FUND, INC. CHIP FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends................................... $ 6,361,546 $ 1,907,812
Interest.................................... 60,432 2,975
Securities lending.......................... 1,379 2,452
------------ -----------
Total Income 6,423,357 1,913,239
Expenses:
Management and investment advisory fees..... 1,492,313 456,213
Distribution fees - Class A................. 423,407 114,504
Distribution fees - Class B................. 143,770 118,563
Registration fees - Class A................. 10,274 5,641
Registration fees - Class B................. 4,758 2,798
Shareholder meeting expense - Class A....... -- 5,795
Shareholder meeting expense - Class B....... -- 1,480
Shareholder reports - Class A............... 24,594 11,856
Shareholder reports - Class B............... 6,238 3,230
Transfer and administrative fees - Class A.. 184,645 84,551
Transfer and administrative fees - Class B.. 47,273 23,922
Auditing and legal fees..................... 5,095 4,695
Custodian fees.............................. 8,644 8,541
Directors' expenses......................... 7,469 2,254
Registration fees........................... 15,056 13,233
Shareholder meeting expense................. 127,007 59,707
Transfer and administrative fees............ 402,833 199,328
Other expenses.............................. 12,562 3,702
------------ -----------
Total Expenses 2,915,938 1,120,013
------------ -----------
Net Investment Income (Operating Loss) 3,507,419 793,226
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions..................... 34,187,882 6,703,549
Futures contracts........................... -- 17,246
Change in unrealized
appreciation/depreciation of:
Investments................................. (16,268,429) (2,877,297)
Futures contracts........................... -- (12,453)
------------ -----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 17,919,453 3,831,045
------------ -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 21,426,872 $ 4,624,271
============ ===========
See accompanying notes.
23
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS EQUITY PARTNERS LARGECAP
GROWTH FUND, INC. BLEND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................. $ 571,538 $ 772,571
Interest.............................. 2,666 3,081
Securities lending.................... 1,071 --
--------- ----------
Total Income 575,275 775,652
Expenses:
Management and investment advisory
fees................................. 229,779 251,521
Distribution fees - Class A........... 57,541 58,350
Distribution fees - Class B........... 70,103 93,648
Registration fees - Class A........... 6,682 4,192
Registration fees - Class B........... 5,594 4,871
Shareholder meeting expense - Class A. -- 1,592
Shareholder meeting expense - Class B. -- 738
Shareholder reports - Class A......... 5,435 3,120
Shareholder reports - Class B......... 1,964 1,426
Transfer and administrative fees -
Class A.............................. 40,173 24,924
Transfer and administrative fees -
Class B.............................. 14,520 10,952
Auditing and legal fees............... 3,553 3,678
Custodian fees........................ 4,891 7,745
Directors' expenses................... 997 840
Registration fees..................... 9,713 12,941
Shareholder meeting expense........... 29,873 18,256
Transfer and administrative fees...... 106,560 79,383
Other expenses........................ 1,506 1,295
--------- ----------
Total Gross Expenses 588,884 579,472
Less: Reimbursement from Manager -
Class A.............................. 22,436 14,919
Less: Reimbursement from Manager -
Class B.............................. 6,271 1,367
--------- ----------
Total Net Expenses 560,177 563,186
--------- ----------
Net Investment Income (Operating Loss) 15,098 212,466
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions............... 442,828 884,423
Futures contracts..................... -- 34,791
Change in unrealized
appreciation/depreciation of:
Investments........................... (444,551) 523,508
Futures contracts..................... -- (34,145)
--------- ----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies (1,723) 1,408,577
--------- ----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 13,375 $1,621,043
========= ==========
See accompanying notes.
24
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS LARGECAP PARTNERS MIDCAP
VALUE FUND, INC. GROWTH FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................. $ 818,126 $ 60,398
Interest.............................. 6,044 1,090
---------- ----------
Total Income 824,170 61,488
Expenses:
Management and investment advisory
fees................................. 247,047 151,709
Distribution fees - Class A........... 58,738 29,741
Distribution fees - Class B........... 86,538 46,174
Registration fees - Class A........... 4,667 5,574
Registration fees - Class B........... 4,466 5,184
Shareholder reports - Class A......... 3,095 2,500
Shareholder reports - Class B......... 1,495 1,038
Transfer and administrative fees -
Class A.............................. 23,897 19,297
Transfer and administrative fees -
Class B.............................. 11,774 8,163
Auditing and legal fees............... 3,255 3,553
Custodian fees........................ 2,635 9,117
Directors' expenses................... 839 511
Registration fees..................... 15,762 10,288
Shareholder meeting expense........... 18,718 14,485
Transfer and administrative fees...... 79,038 61,989
Other expenses........................ 1,400 1,040
---------- ----------
Total Gross Expenses 563,364 370,363
Less: Reimbursement from Manager -
Class A.............................. 12,034 27,045
Less: Reimbursement from Manager -
Class B.............................. 2,361 10,732
---------- ----------
Total Net Expenses 548,969 332,586
---------- ----------
Net Investment Income (Operating Loss) 275,201 (271,098)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions............... 1,486,166 1,821,677
Change in unrealized
appreciation/depreciation of:
Investments........................... 880,994 (466,080)
---------- ----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies 2,367,160 1,355,597
---------- ----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $2,642,361 $1,084,499
========== ==========
See accompanying notes.
25
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS SMALLCAP REAL ESTATE
GROWTH FUND, INC. SECURITIES FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING
LOSS)
Income:
Dividends......................... $ 23,942 $1,294,146
Interest.......................... 2,519 11,664
--------- ----------
Total Income 26,461 1,305,810
Expenses:
Management and investment advisory
fees............................. 91,871 392,769
Distribution fees - Class A....... 17,229 83,729
Distribution fees - Class B....... 29,955 94,281
Registration fees - Class A....... 3,489 5,774
Registration fees - Class B....... 3,398 3,757
Shareholder meeting expense - A... -- 2,074
Shareholder meeting expense - B... -- 785
Shareholder reports - Class A..... 1,350 3,757
Shareholder reports - Class B..... 706 1,401
Transfer and administrative fees -
Class A.......................... 10,649 31,505
Transfer and administrative fees -
Class B.......................... 5,407 11,881
Auditing and legal fees........... 3,053 3,477
Custodian fees.................... 4,648 1,851
Directors' expenses............... 187 1,005
Registration fees................. 14,814 15,431
Shareholder meeting expense....... 8,236 21,640
Transfer and administrative fees.. 43,601 100,298
Other expenses.................... 607 1,666
--------- ----------
Total Gross Expenses 239,200 777,081
Less: Reimbursement from Manager -
Class A.......................... 10,986 --
Less: Reimbursement from Manager -
Class B.......................... 4,112 --
--------- ----------
Total Net Expenses 224,102 777,081
--------- ----------
Net Investment Income (Operating
Loss) (197,641) 528,729
NET REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS AND FOREIGN
CURRENCIES
Net realized gain (loss) from:
Investment transactions........... 763,479 1,464,705
Change in unrealized
appreciation/depreciation of:
Investments....................... (534,587) 4,887,581
--------- ----------
Net Realized and Unrealized Gain
(Loss) on Investments and Foreign
Currencies 228,892 6,352,286
--------- ----------
Net Increase (Decrease) in Net
Assets Resulting from Operations $ 31,251 $6,881,015
========= ==========
See accompanying notes.
26
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
SMALLCAP TAX-EXEMPT
FUND, INC. BOND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends.................................... $ 604,357 $ --
Interest..................................... 15,480 3,899,365
Securities lending........................... 13,117 --
----------- -----------
Total Income 632,954 3,899,365
Expenses:
Management and investment advisory fees...... 482,742 400,552
Distribution fees - Class A.................. 106,170 171,631
Distribution fees - Class B.................. 119,292 27,676
Registration fees - Class A.................. 6,138 5,413
Registration fees - Class B.................. 4,105 4,013
Shareholder meeting expense - Class A........ 4,090 --
Shareholder meeting expense - Class B........ 1,304 --
Shareholder reports - Class A................ 7,920 1,505
Shareholder reports - Class B................ 2,599 135
Transfer and administrative fees - Class A... 59,881 12,471
Transfer and administrative fees - Class B... 20,026 1,266
Auditing and legal fees...................... 3,635 5,989
Custodian fees............................... 5,941 1,655
Directors' expenses.......................... 1,504 2,710
Registration fees............................ 14,789 12,960
Shareholder meeting expense.................. 43,589 6,784
Transfer and administrative fees............. 139,553 32,086
Other expenses............................... 4,759 5,401
----------- -----------
Total Expenses 1,028,037 692,247
----------- -----------
Net Investment Income (Operating Loss) (395,083) 3,207,118
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions...................... 7,239,462 1,875,968
Change in unrealized appreciation/depreciation
of:
Investments.................................. (1,848,417) (2,830,187)
----------- -----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 5,391,045 (954,219)
----------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 4,995,962 $ 2,252,899
=========== ===========
See accompanying notes.
27
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
BALANCED BOND
FUND, INC. FUND, INC.
- ------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------- ------------- ------------- ---------------
- ------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 829,257 $ 1,351,994 $ 3,698,719 $ 8,188,898
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 2,835,500 4,735,935 582,901 3,400,276
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (278,410) 947,601 (2,540,552) (180,512)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 3,386,347 7,035,530 1,741,068 11,408,662
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (874,252) (1,296,154) (4,292,238) (7,470,962)
Class B............... (93,209) (128,004) (649,213) (1,078,662)
------------ ------------ ------------ ------------
Total Dividends and
Distributions (967,461) (1,424,158) (4,941,451) (8,549,624)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 5,427,494 12,047,396 14,030,823 27,743,338
Class B............... 2,185,977 4,338,661 3,850,977 7,091,911
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 858,573 1,273,359 3,822,263 6,566,027
Class B............... 92,509 126,462 619,078 1,016,276
Shares redeemed:
Class A............... (7,594,936) (14,389,404) (18,936,893) (42,763,190)
Class B............... (2,403,556) (5,603,001) (4,854,818) (11,130,444)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (1,433,939) (2,206,527) (1,468,570) (11,476,082)
------------ ------------ ------------ ------------
Redemption fees - Class
A..................... -- -- 461 --
------------ ------------ ------------ ------------
Total Increase
(Decrease) 984,947 3,404,845 (4,668,492) (8,617,044)
NET ASSETS
Beginning of period.... 101,008,129 97,603,284 210,237,090 218,854,134
------------ ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $101,993,076 $101,008,129 $205,568,598 $210,237,090
============ ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 174,803 $ 87,242 $ 824,611 $ 96,778
============ ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 414,314 976,019 1,270,477 2,513,007
Class B............... 167,951 355,065 348,516 643,126
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 65,173 103,150 346,573 594,977
Class B............... 7,050 10,280 56,126 92,137
Shares redeemed:
Class A............... (580,347) (1,166,447) (1,715,772) (3,881,109)
Class B............... (184,651) (457,725) (439,519) (1,010,545)
------------ ------------ ------------ ------------
Net Increase (Decrease) (110,510) (179,658) (133,599) (1,048,407)
============ ============ ============ ============
See accompanying notes.
28
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
CAPITAL VALUE CASH MANAGEMENT
FUND, INC. FUND, INC.
- --------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------- ------------- -------------- ----------------
- --------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 2,348,269 $ 3,487,018 $ 2,808,300 $ 1,884,725
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 13,476,862 42,622,593 -- --
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 4,697,665 (13,415,920) -- --
------------ ------------ ------------- -------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 20,522,796 32,693,691 2,808,300 1,884,725
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (3,607,944) (3,523,805) (2,780,766) (1,863,714)
Class B............... (131,557) (49,273) (27,534) (21,011)
------------ ------------ ------------- -------------
Total Dividends and
Distributions (3,739,501) (3,573,078) (2,808,300) (1,884,725)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 13,014,620 24,462,866 438,162,788 712,232,202
Class B............... 2,893,623 5,647,734 1,316,649 4,780,927
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 3,514,197 3,435,274 2,746,066 1,808,868
Class B............... 130,803 48,598 26,928 20,286
Shares redeemed:
Class A............... (39,345,960) (69,099,334) (427,347,175) (742,992,727)
Class B............... (4,917,433) (10,321,260) (2,448,294) (7,425,708)
------------ ------------ ------------- -------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (24,710,150) (45,826,122) 12,456,962 (31,576,152)
------------ ------------ ------------- -------------
Total Increase
(Decrease) (7,926,855) (16,705,509) 12,456,962 (31,576,152)
NET ASSETS
Beginning of period.... 338,795,730 355,501,239 322,411,124 353,987,276
------------ ------------ ------------- -------------
End of period
(including
undistributed net
investment income as
set forth below)...... $330,868,875 $338,795,730 $ 334,868,086 $ 322,411,124
============ ============ ============= =============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 1,170,283 $ 2,561,515 $ -- $ --
============ ============ ============= =============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 517,859 1,062,154 438,162,788 712,228,299
Class B............... 115,786 247,673 1,316,649 4,780,741
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 138,901 153,566 2,746,066 1,812,770
Class B............... 5,195 2,182 26,928 20,473
Shares redeemed:
Class A............... (1,575,083) (2,994,253) (427,347,175) (742,992,727)
Class B............... (197,002) (453,047) (2,448,294) (7,425,708)
------------ ------------ ------------- -------------
Net Increase (Decrease) (994,344) (1,981,725) 12,456,962 (31,576,152)
============ ============ ============= =============
See accompanying notes.
29
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
EQUITY INCOME GOVERNMENT SECURITIES
FUND, INC. INCOME FUND, INC.
- -----------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------ ------------- ------------- ---------------
- -----------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 1,623,579 $ 2,567,162 $ 4,799,899 $ 12,657,238
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 3,661,218 4,529,179 868,293 (1,150,972)
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 1,582,261 2,028,968 (3,421,050) 1,182,444
----------- ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 6,867,058 9,125,309 2,247,142 12,688,710
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (1,430,376) (2,319,976) (4,593,762) (12,146,945)
Class B............... (184,049) (289,363) (714,505) (2,000,436)
----------- ------------ ------------ ------------
Total Dividends and
Distributions (1,614,425) (2,609,339) (5,308,267) (14,147,381)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 12,072,234 13,472,892 19,255,639 41,666,093
Class B............... 2,137,062 3,625,442 5,576,926 10,443,968
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 1,340,246 2,182,203 4,055,658 10,559,133
Class B............... 179,846 281,558 670,637 1,857,571
Shares redeemed:
Class A............... (6,353,484) (12,473,931) (36,044,138) (80,339,165)
Class B............... (1,701,880) (3,185,303) (7,055,867) (20,716,112)
----------- ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 7,674,024 3,902,861 (13,541,145) (36,528,512)
----------- ------------ ------------ ------------
Total Increase
(Decrease) 12,926,657 10,418,831 (16,602,270) (37,987,183)
NET ASSETS
Beginning of period.... 80,896,763 70,477,932 328,777,079 366,764,262
----------- ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $93,823,420 $ 80,896,763 $312,174,809 $328,777,079
=========== ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 272,357 $ 264,678 $ 5,638 $ 231,304
=========== ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 1,108,173 1,388,725 1,706,128 3,666,875
Class B............... 197,787 374,473 496,945 923,279
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 123,069 223,606 359,858 930,125
Class B............... 16,563 28,936 59,849 164,481
Shares redeemed:
Class A............... (585,768) (1,284,887) (3,193,400) (7,080,458)
Class B............... (157,524) (328,406) (629,230) (1,833,157)
----------- ------------ ------------ ------------
Net Increase (Decrease) 702,300 402,447 (1,199,850) (3,228,855)
=========== ============ ============ ============
See accompanying notes.
30
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
GROWTH INTERNATIONAL EMERGING
FUND, INC. MARKETS FUND, INC.
- ----------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------- ------------- ------------ --------------
- ----------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 702,946 $ (1,290,789) $ 161,179 $ 66,216
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 1,042,241 (14,806,416) 9,004,621 7,812,057
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 10,246,546 26,195,529 (2,477,103) (1,899,031)
------------ ------------ ----------- -----------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 11,991,733 10,098,324 6,688,697 5,979,242
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net realized gain
on investments:
Class A............... -- -- (2,271,248) --
Class B............... -- -- (386,366) --
------------ ------------ ----------- -----------
Total Dividends and
Distributions -- -- (2,657,614) --
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 13,935,989 29,105,912 6,457,711 10,918,453
Class B............... 2,714,730 6,806,109 1,688,147 2,153,355
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 1,539,817 --
Class B............... -- -- 385,556 --
Shares redeemed:
Class A............... (26,538,877) (48,461,430) (3,274,702) (5,145,045)
Class B............... (7,343,230) (14,667,494) (1,066,012) (4,572,784)
------------ ------------ ----------- -----------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (17,231,388) (27,216,903) 5,730,517 3,353,979
------------ ------------ ----------- -----------
Total Increase
(Decrease) (5,239,655) (17,118,579) 9,761,600 9,333,221
NET ASSETS
Beginning of period.... 293,163,497 310,282,076 43,951,794 34,618,573
------------ ------------ ----------- -----------
End of period
(including
undistributed net
investment income as
set forth below)...... $287,923,842 $293,163,497 $53,713,394 $43,951,794
============ ============ =========== ===========
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 702,946 $ -- $ 75,328 $ --
============ ============ =========== ===========
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 496,755 1,107,215 488,869 991,275
Class B............... 101,560 269,675 135,048 199,680
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 122,792 --
Class B............... -- -- 32,345 --
Shares redeemed:
Class A............... (947,656) (1,844,136) (249,511) (465,025)
Class B............... (274,217) (584,448) (85,235) (448,750)
------------ ------------ ----------- -----------
Net Increase (Decrease) (623,558) (1,051,694) 444,308 277,180
============ ============ =========== ===========
See accompanying notes.
31
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
INTERNATIONAL INTERNATIONAL
FUND, INC. SMALLCAP FUND, INC.
- ----------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------- ------------- ------------ --------------
- ----------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 1,424,399 $ 1,780,909 $ (18,226) $ (83,255)
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 22,758,744 39,346,323 6,365,652 13,288,873
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 879,015 (4,435,186) 1,616,301 (1,146,597)
------------ ------------ ----------- -----------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 25,062,158 36,692,046 7,963,727 12,059,021
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (1,922,971) (1,655,792) (2,596) --
Class B............... (119,271) -- -- --
------------ ------------ ----------- -----------
Total Dividends and
Distributions (2,042,242) (1,655,792) (2,596) --
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 14,970,993 23,090,830 8,550,230 10,845,939
Class B............... 2,872,505 4,787,746 2,345,204 3,476,565
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 1,889,055 1,632,465 2,532 --
Class B............... 118,331 -- -- --
Shares redeemed:
Class A............... (27,345,148) (42,764,282) (5,289,023) (8,168,545)
Class B............... (4,826,465) (10,751,736) (2,140,353) (2,977,179)
------------ ------------ ----------- -----------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (12,320,729) (24,004,977) 3,468,590 3,176,780
------------ ------------ ----------- -----------
Total Increase
(Decrease) 10,699,187 11,031,277 11,429,721 15,235,801
NET ASSETS
Beginning of period.... 239,533,840 228,502,563 61,074,590 45,838,789
------------ ------------ ----------- -----------
End of period
(including
undistributed net
investment income as
set forth below)...... $250,233,027 $239,533,840 $72,504,311 $61,074,590
============ ============ =========== ===========
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 997,890 $ 1,665,403 $ (92,381) $ (66,566)
============ ============ =========== ===========
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 1,894,798 3,413,302 506,202 793,793
Class B............... 369,310 721,549 146,436 268,295
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 236,132 252,313 151 --
Class B............... 15,055 -- -- --
Shares redeemed:
Class A............... (3,474,208) (6,324,517) (315,363) (597,976)
Class B............... (620,698) (1,625,001) (134,505) (229,169)
------------ ------------ ----------- -----------
Net Increase (Decrease) (1,579,611) (3,562,354) 202,921 234,943
============ ============ =========== ===========
See accompanying notes.
32
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
LARGECAP STOCK LIMITED TERM
INDEX FUND, INC. BOND FUND, INC.
- ------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------- ------------- ------------- ---------------
- ------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 506,813 $ 439,533 $ 1,833,786 $ 3,279,946
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 195,303 190,581 (126,277) (119,536)
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 1,092,156 3,723,461 (1,424,279) (1,145,154)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 1,794,272 4,353,575 283,230 2,015,256
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (574,674) (334,872) (2,374,175) (4,470,569)
Class B /(a)/ ........ (93,489) (41,985) (202,354) (661,350)
------------ ------------ ------------ ------------
Total Dividends and
Distributions (668,163) (376,857) (2,576,529) (5,131,919)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 21,979,701 20,567,942 55,129,396 84,816,328
Class B /(a)/ ........ 2,565,141 5,504,594 1,628,634 4,798,593
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 567,030 332,314 2,132,011 4,124,292
Class B /(a)/ ........ 92,594 41,269 191,053 626,279
Shares redeemed:
Class A............... (8,075,529) (12,656,578) (46,868,601) (60,362,131)
Class B /(a)/ ........ (15,272,752) (3,010,770) (19,090,504) (5,268,818)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 1,856,185 10,778,771 (6,878,011) 28,734,543
------------ ------------ ------------ ------------
Total Increase
(Decrease) 2,982,294 14,755,489 (9,171,310) 25,617,880
NET ASSETS
Beginning of period.... 66,142,974 51,387,485 139,964,888 114,347,008
------------ ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $ 69,125,268 $ 66,142,974 $130,793,578 $139,964,888
============ ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 193,292 $ 354,642 $ (177,718) $ (1,540,809)
============ ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 2,593,515 2,489,095 5,872,491 8,826,572
Class B /(a)/ ........ 187,839 667,600 177,503 489,915
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 63,568 41,384 227,589 429,284
Class B /(a)/ ........ 10,357 5,127 20,023 64,149
Shares redeemed:
Class A............... (923,760) (1,540,025) (4,990,416) (6,277,932)
Class B /(a)/ ........ (1,720,114) (366,055) (2,012,026) (538,237)
------------ ------------ ------------ ------------
Net Increase (Decrease) 211,405 1,297,126 (704,836) 2,993,751
============ ============ ============ ============
/(a)/ Period from November 1, 2004 through February 28, 2005, discontinuation
of class.
See accompanying notes.
33
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
MIDCAP PARTNERS BLUE
FUND, INC. CHIP FUND, INC.
- ------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------- ------------- ------------- ---------------
- ------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 3,507,419 $ 3,784,001 $ 793,226 $ 224,270
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 34,187,882 49,046,329 6,720,795 11,529,547
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (16,268,429) 17,165,463 (2,889,750) 708,714
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 21,426,872 69,995,793 4,624,271 12,462,531
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (2,739,489) (1,873,467) (898,849) --
Class B............... (242,728) -- -- --
From net realized gain
on investments:
Class A............... (42,025,433) (18,918,527) -- --
Class B............... (6,987,605) (3,509,826) -- --
------------ ------------ ------------ ------------
Total Dividends and
Distributions (51,995,255) (24,301,820) (898,849) --
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 37,128,403 67,359,951 8,544,055 18,153,575
Class B............... 9,729,989 15,364,930 2,008,794 5,057,010
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 44,183,612 20,513,434 881,023 --
Class B............... 7,145,865 3,468,845 -- --
Shares redeemed:
Class A............... (37,162,975) (64,127,304) (12,108,140) (23,047,215)
Class B............... (12,142,070) (23,145,674) (5,021,284) (10,086,567)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 48,882,824 19,434,182 (5,695,552) (9,923,197)
------------ ------------ ------------ ------------
Total Increase
(Decrease) 18,314,441 65,128,155 (1,970,130) 2,539,334
NET ASSETS
Beginning of period.... 531,953,491 466,825,336 149,702,885 147,163,551
------------ ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $550,267,932 $531,953,491 $147,732,755 $149,702,885
============ ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 2,583,206 $ 2,058,004 $ 110,109 $ 215,732
============ ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 883,602 1,642,290 463,020 1,055,448
Class B............... 243,958 393,308 113,513 306,000
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 1,062,627 524,602 46,664 --
Class B............... 181,510 93,299 -- --
Shares redeemed:
Class A............... (884,098) (1,565,497) (656,683) (1,335,091)
Class B............... (304,394) (594,335) (282,864) (610,979)
------------ ------------ ------------ ------------
Net Increase (Decrease) 1,183,205 493,667 (316,350) (584,622)
============ ============ ============ ============
See accompanying notes.
34
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS EQUITY PARTNERS LARGECAP
GROWTH FUND, INC. BLEND FUND, INC.
- ---------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------ ------------ ------------ ---------------
- ---------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 15,098 $ (520,363) $ 212,466 $ (64,094)
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 442,828 978,099 919,214 4,198,505
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (444,551) 1,337,304 489,363 46,715
----------- ----------- ----------- ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 13,375 1,795,040 1,621,043 4,181,126
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:...............
Class A............... -- -- (225,055) --
From net realized gain
on investments:.......
Class A............... -- -- (1,392,371) --
Class B............... -- -- (610,842) --
----------- ----------- ----------- ------------
Total Dividends and
Distributions -- -- (2,228,268) --
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 4,728,967 10,170,326 8,204,964 18,613,108
Class B............... 1,653,090 3,094,708 3,997,572 5,662,852
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 1,590,474 --
Class B............... -- -- 607,423 --
Shares redeemed:
Class A............... (5,182,660) (9,552,550) (4,195,719) (11,559,665)
Class B............... (2,135,379) (3,251,534) (1,424,031) (3,106,606)
----------- ----------- ----------- ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (935,982) 460,950 8,780,683 9,609,689
----------- ----------- ----------- ------------
Total Increase
(Decrease) (922,607) 2,255,990 8,173,458 13,790,815
NET ASSETS
Beginning of period.... 60,166,203 57,910,213 61,647,500 47,856,685
----------- ----------- ----------- ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $59,243,596 $60,166,203 $69,820,958 $ 61,647,500
=========== =========== =========== ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 15,098 $ -- $ (12,589) $ --
=========== =========== =========== ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 629,387 1,412,232 810,814 1,921,625
Class B............... 228,225 443,531 405,553 598,765
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 156,844 --
Class B............... -- -- 61,793 --
Shares redeemed:
Class A............... (689,460) (1,333,057) (415,179) (1,180,990)
Class B............... (294,609) (469,293) (144,635) (324,052)
----------- ----------- ----------- ------------
Net Increase (Decrease) (126,457) 53,413 875,190 1,015,348
=========== =========== =========== ============
See accompanying notes.
35
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS LARGECAP PARTNERS MIDCAP
VALUE FUND, INC. GROWTH FUND, INC.
- ---------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------ ------------- ------------ --------------
- ---------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 275,201 $ 338,775 $ (271,098) $ (556,847)
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 1,486,166 1,882,348 1,821,677 2,923,337
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 880,994 3,542,087 (466,080) (2,050,663)
----------- ------------ ----------- -----------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 2,642,361 5,763,210 1,084,499 315,827
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (398,434) (235,301) -- --
Class B............... (21,202) -- -- --
From net realized gain
on investments:
Class A............... (609,214) -- -- --
Class B............... (247,741) -- -- --
----------- ------------ ----------- -----------
Total Dividends and
Distributions (1,276,591) (235,301) -- --
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 8,577,607 17,869,651 2,741,831 8,880,482
Class B............... 3,578,356 6,152,628 1,144,970 3,032,286
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 984,090 200,183 -- --
Class B............... 265,938 -- -- --
Shares redeemed:
Class A............... (5,062,651) (12,840,726) (3,384,861) (8,690,656)
Class B............... (1,538,551) (3,759,732) (1,097,575) (2,243,479)
----------- ------------ ----------- -----------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 6,804,789 7,622,004 (595,635) 978,633
----------- ------------ ----------- -----------
Total Increase
(Decrease) 8,170,559 13,149,913 488,864 1,294,460
NET ASSETS
Beginning of period.... 60,644,405 47,494,492 32,028,749 30,734,289
----------- ------------ ----------- -----------
End of period
(including
undistributed net
investment income as
set forth below)...... $68,814,964 $ 60,644,405 $32,517,613 $32,028,749
=========== ============ =========== ===========
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 116,584 $ 261,019 $ (271,098) $ --
=========== ============ =========== ===========
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 675,498 1,522,561 493,067 1,714,566
Class B............... 287,194 531,166 211,557 600,005
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 77,449 17,637 -- --
Class B............... 20,262 -- -- --
Shares redeemed:
Class A............... (399,206) (1,091,725) (607,906) (1,689,518)
Class B............... (122,879) (322,368) (203,706) (450,085)
----------- ------------ ----------- -----------
Net Increase (Decrease) 538,318 657,271 (106,988) 174,968
=========== ============ =========== ===========
See accompanying notes.
36
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS SMALLCAP REAL ESTATE
GROWTH FUND, INC. SECURITIES FUND, INC.
- ----------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------ ------------ ------------- ---------------
- ----------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ (197,641) $ (331,099) $ 528,729 $ 1,012,177
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 763,479 858,701 1,464,704 10,586,325
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (534,587) (285,237) 4,887,581 6,462,427
----------- ----------- ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 31,251 242,365 6,881,014 18,060,929
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... -- -- (532,878) (944,526)
Class B............... -- -- (87,582) (193,072)
From net realized gain
on investments:
Class A............... -- -- (8,142,816) (816,595)
Class B............... -- -- (2,507,145) (267,798)
----------- ----------- ------------ ------------
Total Dividends and
Distributions -- -- (11,270,421) (2,221,991)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 1,589,692 5,461,965 14,699,984 24,158,930
Class B............... 1,143,842 2,386,255 3,475,559 7,215,153
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 8,356,532 1,471,107
Class B............... -- -- 2,528,303 365,391
Shares redeemed:
Class A............... (1,294,902) (2,710,168) (10,727,659) (21,504,048)
Class B............... (475,855) (783,669) (2,841,297) (7,445,850)
----------- ----------- ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 962,777 4,354,383 15,491,422 4,260,683
----------- ----------- ------------ ------------
Redemption fees - Class
A..................... -- -- -- 320
----------- ----------- ------------ ------------
Total Increase
(Decrease) 994,028 4,596,748 11,102,015 20,099,941
NET ASSETS
Beginning of period.... 19,106,648 14,509,900 81,463,784 61,363,843
----------- ----------- ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $20,100,676 $19,106,648 $ 92,565,799 $ 81,463,784
=========== =========== ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ (197,641) $ -- $ (26,781) $ 64,950
=========== =========== ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 270,589 990,773 951,502 1,674,101
Class B............... 200,274 444,896 225,938 501,692
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 544,308 104,577
Class B............... -- -- 165,979 26,417
Shares redeemed:
Class A............... (220,319) (497,525) (700,978) (1,527,874)
Class B............... (83,669) (149,112) (187,317) (534,738)
----------- ----------- ------------ ------------
Net Increase (Decrease) 166,875 789,032 999,432 244,175
=========== =========== ============ ============
See accompanying notes.
37
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
SMALLCAP TAX-EXEMPT
FUND, INC. BOND FUND, INC.
- ------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2005 2004 2005 2004
------------- ------------- ------------- ---------------
- ------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ (395,083) $ (966,147) $ 3,207,118 $ 6,830,785
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 7,239,462 19,381,225 1,875,968 2,705,514
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (1,848,417) (8,345,060) (2,830,187) (182,669)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 4,995,962 10,070,018 2,252,899 9,353,630
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... -- -- (2,969,198) (6,135,989)
Class B............... -- -- (162,056) (351,203)
From net realized gain
on investments:
Class A............... -- -- (2,775,228) (452,779)
Class B............... -- -- (179,911) (32,304)
------------ ------------ ------------ ------------
Total Dividends and
Distributions -- -- (6,086,393) (6,972,275)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 7,912,153 14,739,279 7,012,883 11,019,703
Class B............... 2,884,069 5,228,035 298,437 892,740
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 4,645,846 4,813,510
Class B............... -- -- 284,120 280,350
Shares redeemed:
Class A............... (8,466,402) (13,597,490) (13,606,019) (29,485,901)
Class B............... (3,162,843) (5,298,877) (2,275,789) (3,862,107)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (833,023) 1,070,947 (3,640,522) (16,341,705)
------------ ------------ ------------ ------------
Total Increase
(Decrease) 4,162,939 11,140,965 (7,474,016) (13,960,350)
NET ASSETS
Beginning of period.... 106,848,090 95,707,125 177,672,315 191,632,665
------------ ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $111,011,029 $106,848,090 $170,198,299 $177,672,315
============ ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ (395,083) $ -- $ 502,089 $ 510,810
============ ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 787,598 1,663,168 574,488 888,295
Class B............... 303,666 620,532 24,195 71,670
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 382,211 389,153
Class B............... -- -- 23,230 22,566
Shares redeemed:
Class A............... (844,389) (1,539,055) (1,110,337) (2,385,604)
Class B............... (332,708) (632,723) (185,977) (310,527)
------------ ------------ ------------ ------------
Net Increase (Decrease) (85,833) 111,922 (292,190) (1,324,447)
============ ============ ============ ============
See accompanying notes.
38
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
1. ORGANIZATION
Principal Balanced Fund, Inc., Principal Bond Fund, Inc., Principal Capital
Value Fund, Inc., Principal Cash Management Fund, Inc., Principal Equity Income
Fund, Inc., Principal Government Securities Income Fund, Inc., Principal Growth
Fund, Inc., Principal International Emerging Markets Fund, Inc., Principal
International Fund, Inc., Principal International SmallCap Fund, Inc., Principal
LargeCap Stock Index Fund, Inc., Principal Limited Term Bond Fund, Inc.,
Principal MidCap Fund, Inc., Principal Partners Blue Chip Fund, Inc., Principal
Partners Equity Growth Fund, Inc., Principal Partners LargeCap Blend Fund, Inc.,
Principal Partners LargeCap Value Fund, Inc., Principal Partners MidCap Growth
Fund, Inc., Principal Partners SmallCap Growth Fund, Inc., Principal Real Estate
Securities Fund, Inc., Principal SmallCap Fund, Inc., and Principal Tax-Exempt
Bond Fund, Inc. (the "Funds") are registered under the Investment Company Act of
1940, as amended, as open-end diversified management investment companies and
operate in the mutual fund industry.
Each fund offers both Class A shares and Class B shares to the public (with the
exception of Principal LargeCap Stock Index Fund, Inc. and Principal Limited
Term Bond Fund, Inc. which only offer Class A shares.) Class A shares generally
are sold with an initial sales charge (with the exception of Principal Cash
Management Fund, Inc. which are sold at net asset value) based on declining
rates and certain purchases may be subject to a contingent deferred sales charge
("CDSC") if redeemed within eighteen months of purchase. Class B shares are sold
without an initial sales charge, but bear higher ongoing distribution fees and
are subject to a declining CDSC on certain redemptions made within six years of
purchase. Class B shares automatically convert into Class A shares, based on
relative net asset value (without a sales charge), seven years after purchase.
Both classes of shares for each fund represent interests in the same portfolio
of investments, and will vote together as a single class except where otherwise
required by law or as determined by each of the Funds' respective Board of
Directors. In addition, the Board of Directors of each fund declares separate
dividends on each class of shares.
Effective March 1, 2004, Principal Utilities Fund, Inc. and Principal Real
Estate Fund, Inc. changed their names to Principal Equity Income Fund, Inc. and
Principal Real Estate Securities Fund, Inc., respectively.
On February 24, 2005, the Board of Directors of each fund approved an Agreement
and Plan of Reorganization whereby, subject to approval by the shareholders of
each fund, Principal Investors Fund, Inc. will acquire all the assets of each
fund subject to the liabilities of such fund, in exchange for a number of shares
equal to the pro rata net assets of shares of a series of Principal Investors
Fund, Inc.
Effective February 28, 2005, Class B shares of Principal LargeCap Stock Index
Fund, Inc. and Principal Limited Term Bond Fund, Inc. were discontinued and
exchanged into Class A shares. Principal LargeCap Stock Index Fund, Inc. and
Principal Limited Term Bond Fund, Inc. exchanged $14,206,333 and $16,953,682,
respectively.
During 2002 and 2003, the Principal Financial Group (parent company of Principal
Financial Services, Inc.), on behalf of certain of the funds, initiated
litigation against two investment banking firms. The litigation alleged improper
sales practices. As a result of mediation, certain of the funds are entitled to
a settlement that is reflected as litigation on the statements of assets and
liabilities and have recognized a realized gain included as a component of
realized gain (loss) from investment transactions on the statements of
operations.
2. SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with U.S. 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. The
following summarizes the significant accounting policies of the Funds:
SECURITY VALUATION . The Funds (with the exception of Principal Cash Management
Fund, Inc.) value securities for which market quotations are readily available
at market value, which is determined using the last reported sale price. If no
sales are reported, as is regularly the case for some securities traded
over-the-counter, securities are valued using the last reported bid price or an
evaluated bid price provided by a pricing service. Pricing services use
electronic modeling techniques that incorporate security characteristics, market
conditions and dealer-supplied valuations to determine an evaluated bid price.
When reliable market quotations are not considered to be readily available,
which may be the case, for example, with respect to restricted securities,
certain debt securities, preferred stocks and foreign securities, the
investments are valued at their fair value as determined in good faith by
Principal Management Corporation (the "Manager") under procedures established
and periodically reviewed by each fund's Board of Directors.
39
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The value of foreign securities used in computing the net asset value per share
is generally determined as of the close of the foreign exchange where the
security is principally traded. Events that occur after the close of the
applicable foreign market or exchange but prior to the calculation of the fund's
net asset value are ordinarily not reflected in the fund's net asset value. If
events that occur after the close of the applicable foreign market or exchange
but prior to the calculation of the fund's net asset value are determined to
materially affect the value of a foreign security, then the security is valued
at its fair value as determined in good faith by the Manager under procedures
established and periodically reviewed by each fund's Board of Directors. Many
factors are reviewed in the course of making a good faith determination of a
security's fair value, including, but not limited to, price movements in ADRs,
futures contracts, industry indices, general indices and foreign currencies.
To the extent each fund invests in foreign securities listed on foreign
exchanges which trade on days on which the fund does not determine its net asset
value, for example weekends and other customary national U.S. holidays, each
fund's net asset value could be significantly affected on days when shareholders
cannot purchase or redeem shares.
Certain securities issued by companies in emerging market countries may have
more than one quoted valuation at any given point in time, sometimes referred to
as a "local" price and a "premium" price. The premium price is often a
negotiated price, which may not consistently represent a price at which a
specific transaction can be effected. It is the policy of the Funds to value
such securities at prices at which it is expected those shares may be sold, and
the Manager or any sub-advisor is authorized to make such determinations subject
to such oversight by each fund's Board of Directors as may occasionally be
necessary.
Short-term securities are valued at amortized cost, which approximates market.
Principal Cash Management Fund, Inc. values its securities at amortized cost as
permitted under Rule 2a-7 of the Investment Company Act of 1940. Under the
amortized cost method, a security is valued by applying a constant yield to
maturity of the difference between the principal amount due at maturity and the
cost of the security to the fund.
CURRENCY TRANSLATION. . Foreign holdings are translated to U.S. dollars using
the exchange rate at the daily close of the London Exchange. The identified cost
of the fund holdings is translated at approximate rates prevailing when
acquired. Income and expense amounts are translated at approximate rates
prevailing when received or paid, with daily accruals of such amounts reported
at approximate rates prevailing at the date of valuation. Since the carrying
amount of the foreign securities is determined based on the exchange rate and
market values at the close of the period, it is not practicable to isolate that
portion of the results of operations arising as a result of changes in the
foreign exchange rates from the fluctuations arising from changes in the market
prices of securities during the period.
Net realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between trade and settlement dates
on security transactions, and the difference between the amount of dividends and
foreign withholding taxes recorded on the books and the U.S. dollar equivalent
of the amounts actually received or paid. Net unrealized appreciation
(depreciation) on translation of assets and liabilities in foreign currencies
arise from changes in the exchange rate relating to assets and liabilities,
other than investments in securities, purchased and held in non-U.S. denominated
currencies.
INCOME AND INVESTMENT TRANSACTIONS. . The Funds record investment transactions
on a trade date basis. The identified cost basis has been used in determining
the net realized gain or loss from investment transactions and unrealized
appreciation or depreciation of investments. The Funds record dividend income on
the ex-dividend date, except dividend income from foreign securities whereby the
ex-dividend date has passed; such dividends are recorded as soon as the funds
are informed of the ex-dividend date. Interest income is recognized on an
accrual basis. Discounts and premiums on securities are accreted/amortized over
the lives of the respective securities. The Funds allocate daily all income and
realized and unrealized gains or losses to each class of shares based upon the
relative proportion of the value of shares outstanding (number of settled shares
outstanding for Principal Cash Management Fund, Inc.) of each class.
EXPENSES. . Expenses directly attributed to a fund are charged to that fund.
Other fund expenses not directly attributed to a fund are apportioned among the
funds managed by Principal Management Corporation.
The Funds allocate all expenses daily (other than class-specific expenses) to
each class of shares based upon the relative proportion of the value of shares
outstanding (number of settled shares outstanding for Principal Cash Management
Fund, Inc.) of each class. Class-specific expenses charged to each class during
the period ended April 30, 2005 are included separately in the statements of
operations.
40
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
DISTRIBUTIONS TO SHAREHOLDERS. . With respect to Principal Cash Management Fund,
Inc., all net investment income and any net realized gains and losses from
investment transactions are declared as dividends daily to settled shares of
record as of that day. Dividends and distributions to shareholders of the other
Funds are recorded on the ex-dividend date. Dividends and distributions to
shareholders from net investment income and net realized gain from investments
and foreign currency transactions are determined in accordance with federal tax
regulations, which may differ from U.S. generally accepted accounting
principles. These differences are primarily due to differing treatments for
mortgage-backed securities, net operating losses, amortization of premiums and
discounts, expiring capital loss carryforwards, foreign currency transactions,
sales of Passive Foreign Investment Companies, certain defaulted securities,
losses deferred due to wash sales, futures contracts, swap agreements, certain
preferred securities and limitations imposed by Sections 381-384 of the Internal
Revenue Code. Permanent book and tax basis differences are reclassified within
the capital accounts based on federal tax-basis treatment; temporary differences
do not require reclassification. Distributions which exceed current and
accumulated earnings and profits for federal income tax purposes are reported as
return of capital distributions.
Principal Real Estate Securities Fund, Inc. receives substantial distributions
from holdings in Real Estate Investment Trusts ("REITs"). Distributions from
REITs may be characterized as ordinary income, net capital gain, or a return of
capital to the Fund. The proper characterization of REIT distributions is
generally not known until after the end of each calendar year. As such,
estimates must be used in reporting the character of its income and
distributions for financial statement purposes. Due to the nature of REIT
investments, a portion of the distributions received by the Fund may represent a
return of capital.
FEDERAL INCOME TAXES . No provision for federal income taxes is considered
necessary because each fund is qualified as a "regulated investment company"
under the Internal Revenue Code and intends to distribute each year
substantially all of its net investment income and realized capital gains to
shareholders.
FOREIGN TAXES . Certain of the funds are subject to foreign income taxes imposed
by certain countries in which they invest. Foreign income taxes are accrued by
the funds as a reduction of income. These amounts are shown as withholding tax
on foreign dividends on the statements of operations.
Gains realized upon disposition of Indian securities held by the Funds are
subject to capital gains tax in India, payable prior to repatriation of sale
proceeds. The tax is computed on certain net realized gains. Realized losses in
excess of gains may be carried forward eight years to offset future gains. The
Funds accrue an estimated deferred tax liability for future gains on Indian
securities. At April 30, 2005, Principal International Emerging Markets Fund,
Inc. had no deferred tax liability and approximate capital loss carryforwards of
$1,015,000 that expire between 2009 and 2013 and Principal International Fund,
Inc. had a foreign tax refund receivable of $378, deferred tax liability of $291
and no capital loss carryforward, relating to Indian securities.
REDEMPTION AND EXCHANGE FEES . The Funds, except Principal Cash Management Fund,
Inc., will impose a redemption or exchange fee on redemptions or exchanges of
$30,000 or more of Class A shares redeemed or exchanged within 30 days after
they are purchased. The fee is equal to 1.00% of the total redemption or
exchanged amount. The fee is paid to the fund and is intended to offset the
trading costs, market impact, and other costs associated with short-term money
movement in and out of the Funds. These amounts are reflected in the statements
of changes in net assets.
3. OPERATING POLICIES
FUTURES CONTRACTS . The Funds may enter into futures contracts for both hedging
and non-hedging purposes. Initial margin deposits are made by cash deposits or
segregation of specific securities as may be required by the exchange on which
the transaction was conducted. Pursuant to the contracts, a fund agrees to
receive from or pay to the broker, an amount of cash equal to the daily
fluctuation in the value of the contract. Such receipts or payments are known as
"variation margin" and are recorded by the fund as a variation margin receivable
or payable on futures contracts. During the period the futures contracts are
open, daily changes in the value of the contracts are recognized as unrealized
gains or losses. These unrealized gains or losses are included as a component of
net unrealized appreciation (depreciation) of investments on the statements of
assets and liabilities. When the contracts are closed, the fund recognizes a
realized gain or loss equal to the difference between the proceeds from, or cost
of, the closing transaction and the fund's cost basis in the contract.
41
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
3. OPERATING POLICIES (CONTINUED)
INDEMNIFICATION. . Under the Funds' by-laws present and past officers, directors
and employees are indemnified against certain liabilities arising out of the
performance of their duties. In addition, in the normal course of business the
Funds enter into a variety of contracts that may contain representations and
warranties which provide general indemnifications. The Funds' maximum exposure
under these arrangements is unknown, as this would involve future claims that
may be against the fund that have not yet occurred.
JOINT TRADING ACCOUNT . Certain of the Funds may, pursuant to an exemptive order
issued by the Securities and Exchange Commission, transfer uninvested funds into
a joint trading account. The order permits the Funds' cash balances to be
deposited into a single joint account along with the cash of other registered
investment companies managed by Principal Management Corporation. These balances
may be invested in one or more short-term instruments or repurchase agreements
that are collateralized by U.S. government securities.
LINE OF CREDIT. . The Funds participate with other funds managed by Principal
Management Corporation in an unsecured joint line of credit with two banks which
allow the participants to borrow up to $75 million, collectively. Borrowings are
made solely to facilitate the handling of unusual and/or unanticipated
short-term cash requirements. Interest is charged to each participant, based on
its borrowings, at a rate equal to the Fed Funds Rate plus .50%. Additionally, a
commitment fee is charged at the annual rate of .09% on the amount of the line
of credit. The commitment fee is allocated among the participating funds in
proportion to their average net assets during each calendar quarter. At April
30, 2005 the Funds had no outstanding borrowing under the line of credit.
REBATES AND CREDITS . Subject to best execution, the Funds may direct certain
portfolio transactions to brokerage firms that, in turn, have agreed to rebate a
portion of the related brokerage commission to the fund in cash. Commission
rebates are included in realized gain from investment transactions in the
statements of operations. Additionally, certain of the Funds have entered into
an arrangement with their custodian whereby interest earned on uninvested cash
balances is used to offset a portion of each fund's expenses. Custodian fees in
the statements of operations are presented before reduction for credits, which
are reflected as fees paid indirectly.
REPURCHASE AGREEMENTS . The Funds may invest in repurchase agreements that are
fully collateralized, typically by U.S. government or U.S. government agency
securities. When repurchase agreement investments are made as part of the Funds'
securities lending program, the collateral is in the possession of the Funds'
lending agent or a third party agent. The collateral is evaluated daily by the
lending agent to ensure the value is maintained, at a minimum, in an amount
equal to the principal amount plus accrued interest of each repurchase
agreement. In the event of default on the obligation to repurchase, the fund has
the right to liquidate the collateral and apply the proceeds in satisfaction of
the obligation. In the event the seller of a repurchase agreement defaults, the
Fund could experience delays in the realization of the collateral.
RESTRICTED SECURITIES. . Certain funds may invest in securities that are subject
to legal or contractual restrictions on resale. These securities generally may
be resold in transactions exempt from registration or to the public if the
securities are registered. Disposal of these securities may involve
time-consuming negotiations and expense, and prompt sale at an acceptable price
may be difficult. Information regarding restricted securities is included with
footnote designations in each applicable fund's schedule of investments.
42
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
3. OPERATING POLICIES (CONTINUED)
SECURITIES LENDING. . Certain of the Funds may lend portfolio securities to
approved brokerage firms to earn additional income. Each applicable fund
receives collateral (in the form of U.S. government securities, U.S. government
agency securities, letters of credit, and/or cash) against the loaned securities
and maintains collateral in an amount not less than 100% of the market value of
the loaned securities during the period of the loan. Cash collateral received is
usually invested in short-term securities. The market value of loaned securities
is determined at the close of business of the funds and any additional required
collateral is delivered to the funds on the next business day. Although risk is
mitigated by the collateral, the fund could experience a delay in recovering its
securities and possible loss of income or value if the borrower fails to return
them. As of April 30, 2005, the Funds had securities on loan as follows:
VALUE OF VALUE OF
SECURITIES LOANED COLLATERAL
----------------- ----------
Principal Balanced Fund, Inc. $ 173,288 $ 177,500
Principal International Emerging Markets 948,576 1,068,544
Fund, Inc.
Principal International Fund, Inc. 42,388,570 44,462,316
Principal International SmallCap Fund, Inc. 11,244,146 11,553,368
Principal LargeCap Stock Index Fund, Inc. 268,003 282,000
Principal Limited Term Bond Fund, Inc. 154,243 158,360
Principal Partners Blue Chip Fund, Inc. 497,379 508,000
Principal SmallCap Fund, Inc. 9,488,072 9,850,000
SWAP AGREEMENTS. . Certain of the Funds may invest in swaps for the purpose of
managing their exposure to interest rate, credit or market risk. Swaps are
marked-to-market daily; changes in value are recorded as unrealized gain or
loss. These unrealized gains or losses are included as a component of net
unrealized appreciation (depreciation) of investments on the statements of
assets and liabilities. Periodic payments received or made at the end of each
measurement period are recorded as realized gain or loss on the statements of
operations. Upon termination of the swap agreement, the fund recognizes a
realized gain or loss. Notional principal amounts are used to express the extent
of involvement in these contracts, but the potential amounts subject to loss are
much lower. Risks may exceed amounts shown on the statement of assets and
liabilities. These risks include changes in the returns of the underlying
instruments, unfavorable interest rate fluctuation, failure of the
counterparties to perform under the contracts' terms and the possible lack of
liquidity with respect to the swap agreements. Details of swap agreements open
at period end are included in the funds' schedules of investments.
43
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
4. MANAGEMENT AGREEMENT AND TRANSACTIONS WITH AFFILIATES
MANAGEMENT SERVICES . The Funds have agreed to pay investment advisory and
management fees to Principal Management Corporation (wholly owned by Princor
Financial Services Corporation, a subsidiary of Principal Financial Services,
Inc.) computed at an annual percentage rate of each fund's average daily net
assets. The annual rates used in this calculation are as follows:
NET ASSETS OF FUNDS (IN MILLIONS)
---------------------------------------------
FIRST NEXT NEXT NEXT OVER
$100 $100 $100 $100 $400
----- ---- ---- ---- ----
Principal Balanced Fund, .60% .55% .50% .45% .40%
Inc.
Principal Bond Fund, Inc. .50 .45 .40 .35 .30
Principal Cash Management .50 .45 .40 .35 .30
Fund, Inc.
Principal Equity Income .60 .55 .50 .45 .40
Fund, Inc.
Principal Government .50 .45 .40 .35 .30
Securities Income Fund,
Inc.
Principal International 1.25 1.20 1.15 1.10 1.05
Emerging Markets Fund, Inc.
Principal International 1.20 1.15 1.10 1.05 1.00
SmallCap Fund, Inc.
Principal Limited Term Bond .50 .45 .40 .35 .30
Fund, Inc.
Principal MidCap Fund, Inc. .65 .60 .55 .50 .45
Principal Real Estate .90 .85 .80 .75 .70
Securities Fund, Inc.
Principal SmallCap Fund, .85 .80 .75 .70 .65
Inc.
Principal Tax-Exempt Bond .50 .45 .40 .35 .30
Fund, Inc.
NET ASSETS OF FUNDS (IN MILLIONS)
----------------------------------------
FIRST NEXT NEXT NEXT OVER
$250 $250 $250 $250 $1,000
----- ---- ---- ---- ------
Principal Capital Value Fund, .60% .55% .50% .45% .40%
Inc.
Principal Growth Fund, Inc. .60 .55 .50 .45 .40
Principal International Fund, .85 .80 .75 .70 .65
Inc.
Principal Partners Blue Chip .60 .55 .50 .45 .40
Fund, Inc.
Principal Partners Equity .75 .70 .65 .60 .55
Growth Fund, Inc.
Principal Partners LargeCap .75 .70 .65 .60 .55
Blend Fund, Inc.
Principal Partners LargeCap .75 .70 .65 .60 .55
Value Fund, Inc.
Principal Partners SmallCap .90 .85 .80 .75 .70
Growth Fund, Inc.
OVERALL FEE
-------------
Principal LargeCap Stock Index Fund, Inc. .35%
Principal Partners MidCap Growth Fund, Inc. .90
The Funds also reimburse the Manager for transfer and administrative services,
including the cost of accounting, data processing, supplies and other services
rendered.
44
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
4. MANAGEMENT AGREEMENT AND TRANSACTIONS WITH AFFILIATES (CONTINUED)
The Manager has voluntarily agreed to limit the fund's expenses for certain of
the Funds. The limits are expressed as a percentage of average daily net assets
attributable to each class on an annualized basis during the reporting period.
The limits may be changed at any time. The operating expense limits are as
follows:
PERIOD FROM PERIOD FROM
NOVEMBER 1, 2004 MARCH 1, 2005
THROUGH FEBRUARY 28, 2005 THROUGH APRIL 30, 2005
-------------------------- -----------------------
CLASS A CLASS B CLASS A CLASS B
------------ ------------ ----------- -------------
Principal Capital 1.03% N/A 1.03% N/A
Value Fund, Inc.
Principal Equity 1.35 2.10% 1.35 2.10%
Income Fund, Inc.
Principal 1.63 N/A 1.63 N/A
International Fund,
Inc.
Principal 2.00 2.75 2.00 2.75
International SmallCap
Fund, Inc.
Principal LargeCap .90 1.25 .90 N/A
Stock Index Fund, Inc.
Principal Partners 1.65 2.40 1.65 2.40
Equity Growth Fund,
Inc.
Principal Partners 1.45 2.20 1.45 2.20
LargeCap Blend Fund,
Inc.
Principal Partners 1.45 2.20 1.45 2.20
LargeCap Value Fund,
Inc.
Principal Partners 1.75 2.50 1.75 2.50
MidCap Growth Fund,
Inc.
Principal Partners 1.95 2.70 1.95 2.70
SmallCap Growth Fund,
Inc.
DISTRIBUTION FEES . The Funds bear distribution fees with respect to each class
computed at an annual rate of up to .25% for Class A shares and 1.00% for Class
B shares of the average daily net assets attributable to each class of each fund
with the exception of the following funds:
CLASS A CLASS B
------- -------
Principal Cash Management Fund, Inc. N/A 1.00%
Principal LargeCap Stock Index Fund, Inc. .15% N/A
Principal Limited Term Bond Fund, Inc. .15 N/A
Distribution fees are paid to Princor Financial Services Corporation, the
principal underwriter. A portion of the fees is subsequently remitted to retail
dealers, if applicable. Pursuant to the distribution agreements for Class A and
Class B shares, fees that are unused by the principal underwriter at the end of
the fiscal year are returned to the respective fund which generated the excess.
45
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
4. MANAGEMENT AGREEMENT AND TRANSACTIONS WITH AFFILIATES (CONTINUED)
SALES CHARGES . Princor Financial Services Corporation, as principal
underwriter, receives proceeds of any CDSC on certain Class A and Class B share
redemptions. The charge for Class A shares is .75% (.25% for Principal LargeCap
Stock Index Fund, Inc. and Principal Limited Term Bond Fund, Inc.) of the lesser
of current market value or the cost of the shares redeemed. The charge for Class
B shares is based on declining rates which begin at 4.00% of the lesser of
current market value or the cost of shares being redeemed. Princor Financial
Services Corporation also retains sales charges on sales of Class A shares (with
the exception of Principal Cash Management Fund, Inc.) based on declining rates
which begin at 1.50% for Principal LargeCap Stock Index Fund, Inc. and Principal
Limited Term Bond Fund, Inc., 4.75% for Principal Bond Fund, Inc., Principal
Government Securities Income Fund, Inc., and Principal Tax Exempt Bond Fund,
Inc., and 5.75% for all other Funds. The aggregate amounts of these charges
retained by Princor Financial Services Corporation for the year ended April 30,
2005, were as follows:
CLASS A CLASS B
--------- -----------
Principal Balanced Fund, Inc. $136,909 $20,066
Principal Bond Fund, Inc. 230,407 36,569
Principal Capital Value Fund, Inc. 268,618 26,564
Principal Cash Management Fund, Inc. 53 9,567
Principal Equity Income Fund, Inc. 181,836 13,440
Principal Government Securities Income Fund, Inc. 260,549 75,416
Principal Growth Fund, Inc. 274,957 39,266
Principal International Emerging Markets Fund, Inc. 95,056 3,574
Principal International Fund, Inc. 246,390 19,597
Principal International SmallCap Fund, Inc. 136,745 9,720
Principal LargeCap Stock Index Fund, Inc. 60,476 5,671
Principal Limited Term Bond Fund, Inc. 75,113 7,021
Principal MidCap Fund, Inc. 760,457 52,000
Principal Partners Blue Chip Fund, Inc. 146,468 27,373
Principal Partners Equity Growth Fund, Inc. 110,677 16,404
Principal Partners LargeCap Blend Fund, Inc. 208,643 20,709
Principal Partners LargeCap Value Fund, Inc. 211,375 17,650
Principal Partners MidCap Growth Fund, Inc. 69,623 12,112
Principal Partners SmallCap Growth Fund, Inc. 51,234 5,832
Principal Real Estate Securities Fund, Inc. 271,142 12,148
Principal SmallCap Fund, Inc. 175,398 19,014
Principal Tax-Exempt Bond Fund, Inc. 82,648 10,995
AFFILIATED OWNERSHIP . At April 30, 2005, Principal Life Insurance Company (an
affiliate of the Manager), affiliates of Principal Life Insurance Company and
benefit plans sponsored on behalf of Principal Life Insurance Company owned
shares of the Funds as follows:
CLASS A CLASS B
----------- -----------
Principal Bond Fund, Inc. 338,904 --
Principal Capital Value Fund, Inc. 1,669,668 --
Principal Cash Management Fund, Inc. 18,020,478 --
Principal Government Securities Income Fund, Inc. 107,290 --
Principal International Emerging Markets Fund, Inc. 981,190 --
Principal International Fund, Inc. 3,240,152 --
Principal Limited Term Bond Fund, Inc. 685,587 --
Principal Partners SmallCap Growth Fund, Inc. 399,265 100,000
46
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
4. MANAGEMENT AGREEMENT AND TRANSACTIONS WITH AFFILIATES (CONTINUED)
For the period ended April 30, 2005, information, on a federal tax basis,
regarding affiliated securities held by the funds was as follows:
OCTOBER 31, 2004 PURCHASES SALES APRIL 30,2005
----------------- ---------------------- ---------- ---------------
SHARES COST SHARES COST SHARES PROCEEDS SHARES COST
------- -------- ------ ---- ------ -------- ------ ---------
PRINCIPAL LARGECAP
STOCK INDEX FUND, INC.
Principal Financial 1,884 $54,798 13 $511 -- $-- 1,897 $55,309
Group
(parent company of
Principal Financial
Services, Inc.)
DIVIDENDS REALIZED GAIN/LOSS
--------- ------------------
PRINCIPAL LARGECAP STOCK INDEX FUND,
INC.
Principal Financial Group $1,036 $--
(parent company of Principal
Financial Services, Inc.)
AFFILIATED BROKERAGE COMMISSIONS . With respect to Principal Equity Income Fund,
Inc., $8,929 of brokerage commissions were paid to Spectrum Asset Management,
Inc., a member of the Principal Financial Group. The other Funds did not pay
brokerage commissions to any member of the Principal Financial Group. Brokerage
commissions were paid to affiliates of sub-advisors by Principal Partners
LargeCap Value Fund, Inc. in the amount $16,155.
5. INVESTMENT TRANSACTIONS
For the period ended April 30, 2005, the cost of investment securities purchased
and proceeds from investment securities sold (not including short-term
investments and U.S. government securities) by the Funds were as follows:
PURCHASES SALES
------------ ------------
Principal Balanced Fund, Inc. $ 68,495,462 $ 69,711,671
Principal Bond Fund, Inc. 180,813,625 179,129,040
Principal Capital Value Fund, Inc. 223,065,872 242,208,841
Principal Equity Income Fund, Inc. 46,472,455 36,414,186
Principal Government Securities Income 590,192,547 466,074,930
Fund, Inc.
Principal Growth Fund, Inc. 317,936,717 345,778,502
Principal International Emerging 55,110,413 53,951,494
Markets Fund, Inc.
Principal International Fund, Inc. 170,817,428 185,160,924
Principal International SmallCap Fund, 45,358,521 42,360,556
Inc.
Principal LargeCap Stock Index Fund, 8,537,596 6,034,277
Inc.
Principal Limited Term Bond Fund, Inc. 51,136,296 58,186,392
Principal MidCap Fund, Inc. 139,330,665 133,287,485
Principal Partners Blue Chip Fund, 52,799,811 58,196,453
Inc.
Principal Partners Equity Growth Fund, 23,677,560 24,698,398
Inc.
Principal Partners LargeCap Blend 22,257,696 14,783,414
Fund, Inc.
Principal Partners LargeCap Value 13,728,313 7,911,368
Fund, Inc.
Principal Partners MidCap Growth Fund, 20,298,028 21,707,213
Inc.
Principal Partners SmallCap Growth 3,018,186 2,745,289
Fund, Inc.
Principal Real Estate Securities Fund, 17,087,652 10,602,831
Inc.
Principal SmallCap Fund, Inc. 95,256,383 93,539,033
Principal Tax-Exempt Bond Fund, Inc. 42,454,783 49,785,757
47
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
5. INVESTMENT TRANSACTIONS (CONTINUED)
For the period ended April 30, 2005, the cost of U.S. government securities
purchased and proceeds from U.S government securities sold (not including
short-term investments) by the Funds were as follows:
PURCHASES SALES
------------ ------------
Principal Balanced Fund, Inc. $ 1,147,325 $ 1,972,313
Principal Bond Fund, Inc. 7,317,061 9,252,306
Principal Government Securities Income 120,856,160 210,219,187
Fund, Inc.
Principal Limited Term Bond Fund, Inc. 10,349,798 6,888,902
The Funds may trade portfolio securities on a "to-be-announced" ("TBA") or
when-issued basis. In a TBA or when-issued transaction, the fund commits to
purchase or sell securities for which all specific information is not known at
the time of the trade. Securities purchased on a TBA or when-issued basis are
not settled until they are delivered to the fund, normally 15 to 30 days later.
These transactions are subject to market fluctuations and their current value is
determined in the same manner as for other portfolio securities. The value of
the securities purchased on a TBA or when-issued basis are identified as such in
each fund's schedule of investments.
6. FEDERAL TAX INFORMATION
DISTRIBUTIONS TO SHAREHOLDERS . The federal income tax character of
distributions paid for six month period ended April 30, 2005 and the year ended
October 31, 2004 were as follows:
ORDINARY INCOME LONG-TERM CAPITAL GAIN
------------ -------------
2005 2004 2005 2004
---- ---- ---- ----
Principal Balanced Fund, $ 967,461 $ 1,424,158 $ -- $ --
Inc.
Principal Bond Fund, Inc. 4,941,451 8,549,624 -- --
Principal Capital Value 3,739,501 3,573,078 -- --
Fund, Inc.
Principal Cash Management 2,808,300 1,884,725 -- --
Fund, Inc.
Principal Equity Income 1,614,425 2,609,339 -- --
Fund, Inc.
Principal Government 5,308,267 14,147,381 -- --
Securities Income Fund,
Inc.
Principal Growth Fund, -- -- -- --
Inc.
Principal International -- -- 2,657,614 --
Emerging Markets Fund,
Inc.
Principal International 2,042,242 1,655,792 -- --
Fund, Inc.
Principal International 2,596 -- -- --
SmallCap Fund, Inc.
Principal LargeCap Stock 668,163 376,857 -- --
Index Fund, Inc.
Principal Limited Term 2,576,529 5,131,919 -- --
Bond Fund, Inc.
Principal MidCap Fund, 7,578,360 4,848,215 44,416,895 19,453,605
Inc.
Principal Partners Blue 898,849 -- -- --
Chip Fund, Inc.
Principal Partners Equity -- -- -- --
Growth Fund, Inc.
Principal Partners 648,161 -- 1,580,107 --
LargeCap Blend Fund, Inc.
Principal Partners 419,636 235,301 856,955 --
LargeCap Value Fund, Inc.
Principal Partners MidCap -- -- -- --
Growth Fund, Inc.
Principal Partners -- -- -- --
SmallCap Growth Fund,
Inc.
Principal Real Estate 2,397,979 1,137,598 8,872,442 1,084,393
Securities Fund, Inc.
Principal SmallCap Fund, -- -- -- --
Inc.
Principal Tax-Exempt Bond 3,131,255 6,511,831 2,955,138 460,444
Fund, Inc.
For U.S. federal income tax purposes, short-term capital gain distributions are
considered ordinary income distributions.
48
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
6. FEDERAL TAX INFORMATION (CONTINUED)
DISTRIBUTABLE EARNINGS. . As of October 31, 2004, the components of
distributable earnings on a federal tax basis were as follows:
UNDISTRIBUTED UNDISTRIBUTED
ORDINARY INCOME LONG-TERM CAPITAL GAINS
---------------- -----------------------
Principal Balanced Fund, Inc. $ 223,236 $ --
Principal Bond Fund, Inc. 870,444 --
Principal Capital Value Fund,
Inc. 2,561,515 --
Principal Cash Management Fund,
Inc. -- --
Principal Equity Income Fund,
Inc. 264,678 --
Principal Government Securities
Income Fund, Inc. 231,304 --
Principal Growth Fund, Inc. -- --
Principal International Emerging
Markets Fund, Inc. -- 2,657,796
Principal International Fund,
Inc. 1,688,520 --
Principal International SmallCap
Fund, Inc. 2,431 --
Principal LargeCap Stock Index
Fund, Inc. 354,642 --
Principal Limited Term Bond Fund,
Inc. 41,626 --
Principal MidCap Fund, Inc. 6,654,594 44,417,448
Principal Partners Blue Chip
Fund, Inc. 215,732 --
Principal Partners Equity Growth
Fund, Inc. -- --
Principal Partners LargeCap Blend
Fund, Inc. 423,573 1,580,599
Principal Partners LargeCap Value
Fund, Inc. 261,019 857,031
Principal Partners MidCap Growth
Fund, Inc. -- --
Principal Partners SmallCap
Growth Fund, Inc. -- --
Principal Real Estate Securities
Fund, Inc. 1,843,042 8,872,570
Principal SmallCap Fund, Inc. -- --
Principal Tax-Exempt Bond Fund,
Inc. 138,202 2,955,538
49
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2005 (UNAUDITED)
-------------------------------------------------------------------------------
6. FEDERAL TAX INFORMATION (CONTINUED)
CAPITAL LOSS CARRYFORWARDS . Capital loss carryforwards are losses that can be
used to offset future capital gains of the fund. At October 31, 2004, the Funds
had approximate net capital loss carryforwards as follows:
NET CAPITAL LOSS CARRYFORWARD EXPIRING IN: ANNUAL
2005 2006 2007 2008 2009 2010 2011 2012 LIMITATIONS*
---- ---- ---- ---- ---- ---- ---- ---- ------------
Principal Balanced Fund, $ -- $ -- $ -- $11,458,000 $ -- $ -- $ --
Inc. $ -- $ --
Principal Bond Fund, -- 6,331,000 5,680,000 1,281,000 -- -- 902,000
Inc. -- --
Principal Capital Value -- -- -- 3,598,000 -- -- --
Fund, Inc. -- --
Principal Equity Income -- -- 1,311,000 18,782,000 3,744,000 -- --
Fund, Inc. -- --
Principal Government
Securities 6,000 941,000 -- 1,635,000 2,041,000 2,596,000 --
Income Fund, Inc. 776,000 --
Principal Growth Fund, -- 54,099,000 98,171,000 2,166,000 14,931,000 450,000
Inc. -- --
Principal International -- 402,000 17,496,000 46,940,000 9,842,000 11,000 370,000
Fund, Inc. -- --
Principal International
SmallCap -- -- -- 367,000 3,073,000 -- --
Fund, Inc. -- --
Principal LargeCap Stock
Index
Fund, Inc. -- -- -- -- 750,000 1,755,000 -- -- --
Principal Limited Term
Bond
Fund, Inc. 21,000 9,000 32,000 264,000 197,000 894,000 -- 1,572,000 --
Principal Partners Blue
Chip -- -- -- 6,699,000 18,843,000 -- --
Fund, Inc. -- --
Principal Partners
Equity Growth
Fund, Inc. -- -- -- 3,181,000 15,271,000 7,931,000 -- 115,000 215,000
Principal Partners
MidCap Growth
Fund, Inc. -- -- -- -- 6,908,000 5,044,000 -- -- 299,000
Principal Partners
SmallCap
Growth Fund, Inc. -- -- -- 1,333,000 3,612,000 -- --
Principal SmallCap Fund, -- -- -- 16,844,000 -- --
Inc. -- --
*In accordance with Sections 381-384 of the Internal Revenue Code, a portion of
certain fund's losses have been subjected to an annual limitation.
50
SCHEDULE OF INVESTMENTS
PRINCIPAL BALANCED FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (64.55%)
ADVERTISING AGENCIES (0.04%)
$
Omnicom Group 460 38,134
ADVERTISING SERVICES (0.07%)
WPP Group 1,233 66,718
AEROSPACE & DEFENSE (0.37%)
Boeing 1,198 71,305
Northrop Grumman 4,445 243,764
Rockwell Collins 1,280 58,726
United Industrial 226 6,353
380,148
AEROSPACE & DEFENSE EQUIPMENT (0.91%)
Armor Holdings /1/ 1,381 48,349
General Dynamics 2,929 307,692
Lockheed Martin 3,700 225,515
Moog /1/ 724 21,582
Orbital Sciences /1/ 1,619 15,089
United Defense Industries 415 30,702
United Technologies 2,756 280,340
929,269
AGRICULTURAL OPERATIONS (0.08%)
Monsanto 1,320 77,378
AIRLINES (0.00%)
Pinnacle Airlines /1/ 54 558
APPAREL MANUFACTURERS (0.46%)
Coach /1/ 8,782 235,358
Guess? /1/ 1,633 21,262
Liz Claiborne 2,710 96,015
Quiksilver /1/ 691 19,037
VF 1,660 93,939
465,611
APPLICATIONS SOFTWARE (1.38%)
Citrix Systems /1/ 2,475 55,688
Compuware /1/ 5,820 34,629
Microsoft 46,718 1,181,965
Parametric Technology /1/ 7,300 38,836
Quest Software /1/ 3,284 38,948
Salesforce.com /1/ 639 9,253
Serena Software /1/ 1,467 27,917
SS&C Technologies 873 22,183
1,409,419
ATHLETIC FOOTWEAR (0.28%)
Nike 3,659 281,048
AUDIO & VIDEO PRODUCTS (0.12%)
Matsushita Electric Industrial 4,650 68,123
Pioneer 1,400 23,800
Polycom /1/ 1,970 30,062
121,985
AUTO-CARS & LIGHT TRUCKS (0.22%)
Nissan Motor 5,146 101,119
Toyota Motor 1,646 119,681
220,800
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.36%)
$
Oshkosh Truck 889 66,809
Paccar 3,107 210,965
Volvo 2,096 84,825
362,599
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.12%)
Autoliv 920 40,710
Dana 1,046 11,945
Magna International 620 37,901
Tenneco Automotive /1/ 2,836 36,386
126,942
BEVERAGES-NON-ALCOHOLIC (1.07%)
Coca-Cola 10,004 434,574
Cott /1/ 2,035 45,563
Pepsico 11,017 612,986
1,093,123
BEVERAGES-WINE & SPIRITS (0.31%)
Brown-Forman 4,185 232,268
Diageo 1,424 85,084
317,352
BREWERY (0.02%)
SABMiller 1,626 23,902
BROADCASTING SERVICES & PROGRAMMING (0.01%)
4 Kids Entertainment /1/ 380 7,661
BUILDING & CONSTRUCTION PRODUCTS-
MISCELLANEOUS (0.05%)
NCI Building Systems /1/ 563 18,252
Simpson Manufacturing 1,124 30,348
48,600
BUILDING PRODUCTS-AIR & HEATING (0.05%)
American Standard 1,230 54,993
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.16%)
CRH 2,959 73,694
Eagle Materials 642 48,311
Texas Industries 879 40,592
162,597
BUILDING PRODUCTS-LIGHT FIXTURES (0.02%)
Genlyte Group /1/ 304 24,119
BUILDING PRODUCTS-WOOD (0.03%)
Universal Forest Products 718 27,327
BUILDING-MAINTENANCE & SERVICE (0.03%)
Rollins 1,689 33,341
BUILDING-MOBILE HOME & MANUFACTURED
HOUSING (0.01%)
Thor Industries 226 6,091
Winnebago Industries 208 6,061
12,152
BUILDING-RESIDENTIAL & COMMERCIAL (0.48%)
Brookfield Homes 1,082 46,450
Daiwa House Industry 152 17,067
DR Horton 1,413 43,096
Hovnanian Enterprises /1/ 550 27,924
KB Home 2,738 156,066
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
BUILDING-RESIDENTIAL & COMMERCIAL (CONTINUED)
$
M/I Homes 738 33,727
MDC Holdings 494 32,298
Pulte Homes 1,434 102,459
Technical Olympic USA 1,382 29,091
488,178
CABLE TV (0.17%)
Comcast /1/ 5,430 174,357
CASINO HOTELS (0.08%)
Ameristar Casinos 412 20,311
Station Casinos 960 61,949
82,260
CELLULAR TELECOMMUNICATIONS (0.34%)
Centennial Communications /1/ 643 7,395
mm02 /1/ 3,474 83,908
Nextel Partners /1/ 3,220 75,734
Vodafone Group 6,962 181,987
349,024
CHEMICALS-DIVERSIFIED (0.65%)
BASF 638 41,406
Dow Chemical 7,600 349,068
FMC /1/ 2,238 109,662
PPG Industries 2,400 162,120
662,256
CHEMICALS-SPECIALTY (0.29%)
Albemarle 537 19,660
Cabot 2,632 80,408
Cytec Industries 1,390 64,107
Eastman Chemical 900 48,600
MacDermid 469 14,234
Sigma-Aldrich 680 39,732
Terra Industries /1/ 4,565 29,535
296,276
COATINGS & PAINT (0.08%)
Sherwin-Williams 1,865 83,123
COMMERCIAL BANKS (1.76%)
Associated Banc-Corp 3,090 95,543
Banco Santander Central Hispano 9,918 115,049
Bank of Hawaii 882 41,763
Bank of Ireland 1,240 76,012
Bank of Nova Scotia 3,340 106,212
BB&T 760 29,800
BNP Paribas 5,500 180,400
BOK Financial /1/ 135 5,650
Capital Corp of the West 196 4,758
Cathay General Bancorp 541 17,783
Center Financial 353 7,039
City Holding 356 11,449
City National 889 62,674
Colonial BancGroup 4,503 99,336
Columbia Banking Systems 559 13,120
Community Bank System 422 9,339
Compass Bancshares 2,050 88,191
Corus Bankshares 344 16,797
Cullen/Frost Bankers 443 19,191
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL BANKS (CONTINUED)
$
First Midwest Bancorp 713 23,287
Hudson United Bancorp 794 27,202
Kookmin Bank /1/ 857 36,637
Marshall & Ilsley 2,620 111,717
Nara Bancorp. 842 11,316
National Bank of Greece 6,934 47,359
North Fork Bancorp 8,407 236,657
Pacific Capital Bancorp. 1,232 35,518
R&G Financial 1,167 16,583
South Financial Group 841 22,194
Toronto-Dominion Bank 1,974 78,940
UCBH Holdings 2,050 32,246
UnionBanCal 1,436 88,400
United Bankshares 206 6,308
Vineyard National Bancorp. 172 5,043
Vineyard National Bancorp.-Rights
/1/ /2/ /3/ 43 -
Westamerica Bancorp. 270 13,484
Wilshire Bancorp. 265 3,625
1,796,622
COMMERCIAL SERVICE-FINANCE (0.06%)
iPayment /1/ 92 3,348
Paychex 1,940 59,364
62,712
COMMUNICATIONS SOFTWARE (0.08%)
Avid Technology /1/ 1,610 79,711
Digi International /1/ 487 5,187
84,898
COMPUTER AIDED DESIGN (0.20%)
ANSYS /1/ 615 18,721
Autodesk 5,850 186,205
204,926
COMPUTER SERVICES (0.14%)
Cognizant Technology Solutions
/1/ 1,927 80,953
Kanbay International /1/ 626 11,256
Perot Systems /1/ 1,715 21,660
SRA International /1/ 387 25,291
139,160
COMPUTERS (0.97%)
Apple Computer /1/ 9,974 359,662
Hewlett-Packard 9,350 191,395
International Business Machines 5,731 437,734
988,791
COMPUTERS-INTEGRATED SYSTEMS (0.63%)
Brocade Communications Systems
/1/ 4,900 21,364
Catapult Communications /1/ 277 4,094
Dell /1/ 15,133 527,082
NCR /1/ 2,620 86,460
639,000
COMPUTERS-MEMORY DEVICES (0.67%)
EMC /1/ 24,218 317,740
Komag /1/ 1,370 32,222
Network Appliance /1/ 7,660 203,986
Seagate Technology /1/ 3,475 61,090
Storage Technology /1/ 561 15,596
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMPUTERS-MEMORY DEVICES (CONTINUED)
$
TDK 790 55,395
686,029
CONSULTING SERVICES (0.05%)
Accenture /1/ 1,960 42,532
PDI 268 4,929
47,461
CONSUMER PRODUCTS-MISCELLANEOUS (0.17%)
Central Garden & Pet /1/ 407 16,927
Fortune Brands 1,410 119,258
Scotts /1/ 470 34,028
170,213
CONTAINERS-METAL & GLASS (0.29%)
Ball 7,017 277,172
Silgan Holdings 345 21,107
298,279
CONTAINERS-PAPER & PLASTIC (0.04%)
Sonoco Products 1,460 39,551
COSMETICS & TOILETRIES (1.64%)
Avon Products 5,024 201,362
Chattem /1/ 714 29,374
Colgate-Palmolive 860 42,819
Estee Lauder 3,024 116,152
Gillette 9,283 479,374
Kimberly-Clark 880 54,956
Procter & Gamble 13,735 743,750
1,667,787
CRUISE LINES (0.11%)
Carnival 2,310 112,913
DATA PROCESSING & MANAGEMENT (0.34%)
Automatic Data Processing 4,782 207,730
Global Payments 2,176 140,918
348,648
DECISION SUPPORT SOFTWARE (0.02%)
Wind River Systems /1/ 1,448 18,795
DENTAL SUPPLIES & EQUIPMENT (0.06%)
Sybron Dental Specialties /1/ 1,685 62,766
DIAGNOSTIC EQUIPMENT (0.07%)
Gen-Probe /1/ 1,498 75,185
DIALYSIS CENTERS (0.04%)
DaVita /1/ 931 37,519
DIRECT MARKETING (0.16%)
Catalina Marketing 911 21,181
Harte-Hanks 4,830 137,655
158,836
DISPOSABLE MEDICAL PRODUCTS (0.19%)
C.R. Bard 2,766 196,856
DISTRIBUTION-WHOLESALE (0.24%)
Aviall /1/ 1,116 32,643
Brightpoint /1/ 553 11,679
Hughes Supply 1,857 48,468
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DISTRIBUTION-WHOLESALE (CONTINUED)
$
Navarre /1/ 177 1,416
Owens & Minor 827 23,991
United Stationers /1/ 844 35,600
W.W. Grainger 1,140 63,031
WESCO International /1/ 1,371 33,151
249,979
DIVERSIFIED MANUFACTURING OPERATIONS (2.84%)
3M 1,560 119,293
Danaher 1,300 65,819
Eaton 1,540 90,398
General Electric 47,250 1,710,450
Illinois Tool Works 2,012 168,646
ITT Industries 2,899 262,243
Siemens 1,305 95,944
Textron 1,340 100,969
Tyco International 9,106 285,109
2,898,871
DIVERSIFIED MINERALS (0.27%)
Anglo American 2,590 57,809
BHP Billiton 4,750 120,080
Cia Vale do Rio Doce 3,510 94,594
272,483
DIVERSIFIED OPERATIONS (0.16%)
Brascan 2,731 98,371
Tomkins /4/ 3,537 67,486
165,857
E-COMMERCE-PRODUCTS (0.01%)
Provide Commerce /1/ 346 6,107
E-COMMERCE-SERVICES (0.13%)
eBay /1/ 846 26,843
Monster Worldwide /1/ 4,480 103,085
129,928
E-MARKETING-INFORMATION (0.01%)
Digital River /1/ 379 10,081
E-SERVICES-CONSULTING (0.05%)
Websense /1/ 959 50,875
ELECTRIC PRODUCTS-MISCELLANEOUS (0.33%)
Ametek 2,530 95,811
Emerson Electric 1,820 114,059
Hitachi 1,120 65,766
Sharp 4,079 63,225
338,861
ELECTRIC-GENERATION (0.09%)
AES /1/ 5,438 87,443
ELECTRIC-INTEGRATED (1.73%)
Constellation Energy Group 4,305 226,271
Duke Energy 5,900 172,221
E.ON 2,634 74,542
Edison International 5,780 209,814
Enel 1,820 86,905
Exelon 6,118 302,841
MDU Resources Group 2,203 59,547
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRIC-INTEGRATED (CONTINUED)
$
OGE Energy 1,040 28,704
PPL 910 49,376
RWE 731 43,568
Scottish Power 3,020 97,999
TXU 4,809 412,564
1,764,352
ELECTRIC-TRANSMISSION (0.13%)
National Grid Group 2,611 129,062
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.13%)
DSP Group /1/ 1,646 39,669
Koninklijke Philips Electronics 2,376 58,901
Methode Electronics 324 3,651
Omron 1,531 32,610
134,831
ELECTRONIC COMPONENTS-SEMICONDUCTOR (1.25%)
Diodes /1/ 403 11,804
Fairchild Semiconductor
International /1/ 397 5,340
Intel 33,164 780,017
MEMC Electronics Materials /1/ 1,498 17,571
Microsemi /1/ 2,656 44,939
Nvidia /1/ 2,740 60,116
PMC - Sierra /1/ 1,011 8,149
Silicon Laboratories /1/ 418 10,617
Texas Instruments 13,424 335,063
1,273,616
ELECTRONIC CONNECTORS (0.09%)
Amphenol 2,273 89,647
ELECTRONIC FORMS (0.27%)
Adobe Systems 4,670 277,725
ELECTRONIC MEASUREMENT INSTRUMENTS (0.02%)
LeCroy /1/ 433 5,698
Tektronix 590 12,780
18,478
ELECTRONIC PARTS DISTRIBUTION (0.04%)
Avnet /1/ 1,967 37,157
ELECTRONICS-MILITARY (0.05%)
L-3 Communications Holdings 750 53,228
ENGINES-INTERNAL COMBUSTION (0.05%)
Cummins Engine 680 46,240
ENTERPRISE SOFTWARE & SERVICE (0.36%)
Hyperion Solutions /1/ 1,388 56,450
Oracle /1/ 22,998 265,857
SAP 1,175 46,330
368,637
FINANCE-AUTO LOANS (0.01%)
WFS Financial /1/ 135 6,068
FINANCE-COMMERCIAL (0.08%)
CIT Group 1,900 76,532
FINANCE-CONSUMER LOANS (0.05%)
Aiful 749 13,924
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-CONSUMER LOANS (CONTINUED)
$
First Marblehead /1/ 900 34,677
48,601
FINANCE-CREDIT CARD (0.71%)
American Express 6,442 339,493
Capital One Financial 4,063 288,026
MBNA 2,710 53,523
Providian Financial /1/ 2,684 44,742
725,784
FINANCE-INVESTMENT BANKER & BROKER (2.74%)
Bear Stearns 790 74,781
Citigroup 24,595 1,154,981
E*Trade Financial /1/ 10,330 114,766
Goldman Sachs Group 4,412 471,158
Lehman Brothers Holdings 4,186 383,940
Merrill Lynch 6,665 359,444
Morgan Stanley 3,320 174,698
Nomura Holdings 5,175 66,033
2,799,801
FINANCE-MORTGAGE LOAN/BANKER (0.39%)
American Home Mortgage Investment 1,374 44,930
Countrywide Financial 6,187 223,907
Federal Home Loan Mortgage 800 49,216
Federal National Mortgage
Association 1,408 75,962
394,015
FINANCIAL GUARANTEE INSURANCE (0.14%)
MGIC Investment 2,265 133,635
Triad Guaranty /1/ 180 9,056
142,691
FOOD-FLOUR & GRAIN (0.12%)
Archer Daniels Midland 6,790 122,152
FOOD-MEAT PRODUCTS (0.18%)
Hormel Foods 2,830 88,126
Smithfield Foods /1/ 3,290 99,556
187,682
FOOD-MISCELLANEOUS/DIVERSIFIED (0.42%)
Kellogg 4,635 208,343
Nestle 2,053 134,471
Ralcorp Holdings /1/ 672 26,625
Unilever 976 62,884
432,323
FOOD-RETAIL (0.11%)
Tesco 6,162 109,992
FOOD-WHOLESALE & DISTRIBUTION (0.02%)
Nash Finch 478 16,907
FOOTWEAR & RELATED APPAREL (0.10%)
Deckers Outdoor /1/ 181 3,814
Timberland /1/ 1,109 76,576
Wolverine World Wide 973 19,742
100,132
GAS-DISTRIBUTION (0.51%)
Energen 3,248 201,214
ONEOK 4,804 138,643
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
GAS-DISTRIBUTION (CONTINUED)
$
UGI 3,525 177,061
516,918
HOTELS & MOTELS (0.38%)
Hilton Hotels 5,585 121,920
InterContinental Hotels Group 4,452 52,979
Starwood Hotels & Resorts
Worldwide 4,000 217,360
392,259
HUMAN RESOURCES (0.14%)
Korn/Ferry International /1/ 1,684 24,250
Labor Ready /1/ 2,970 49,569
Robert Half International 2,773 68,826
142,645
IMPORT & EXPORT (0.17%)
Mitsubishi 6,230 168,833
INSTRUMENTS-CONTROLS (0.08%)
Thermo Electron /1/ 3,442 85,981
INSTRUMENTS-SCIENTIFIC (0.15%)
Applied Biosystems Group 1,830 38,796
PerkinElmer 5,933 109,761
148,557
INTERNET APPLICATION SOFTWARE (0.01%)
S1 /1/ 282 1,489
Verity /1/ 870 7,134
8,623
INTERNET CONNECTIVE SERVICES (0.01%)
Hanaro Telecom /1/ 5,937 14,843
INTERNET SECURITY (0.18%)
RSA Security /1/ 1,696 18,215
Symantec /1/ 5,774 108,436
VeriSign /1/ 2,300 60,858
187,509
INTERNET TELEPHONY (0.04%)
j2 Global Communications /1/ 1,143 40,828
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.34%)
Franklin Resources 2,460 168,953
Nuveen Investments 4,072 138,407
T. Rowe Price Group 780 43,033
350,393
LASERS-SYSTEMS & COMPONENTS (0.02%)
Coherent /1/ 504 16,168
LIFE & HEALTH INSURANCE (0.44%)
AmerUs Group 518 24,351
Genworth Financial 1,520 42,484
Lincoln National 5,170 232,495
Stancorp Financial Group 944 72,235
UICI 277 6,432
UnumProvident 4,190 70,057
448,054
MACHINERY TOOLS & RELATED PRODUCTS (0.03%)
Lincoln Electric Holdings 1,090 33,300
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MACHINERY-CONSTRUCTION & MINING (0.04%)
$
Bucyrus International 119 4,634
Joy Global 754 25,538
Terex /1/ 327 12,223
42,395
MACHINERY-FARM (0.16%)
Deere 2,600 162,604
MACHINERY-GENERAL INDUSTRY (0.05%)
Applied Industrial Technologies 777 21,678
Idex 607 22,611
Middleby 194 8,544
52,833
MEDICAL INFORMATION SYSTEM (0.02%)
Dendrite International /1/ 1,001 15,435
MEDICAL INSTRUMENTS (0.22%)
Conmed /1/ 713 21,191
dj Orthopedics /1/ 749 18,837
Medtronic 2,450 129,115
St. Jude Medical /1/ 1,000 39,030
Techne /1/ 500 20,890
229,063
MEDICAL LASER SYSTEMS (0.01%)
Candela /1/ 616 5,581
MEDICAL PRODUCTS (1.60%)
American Medical Systems Holding
/1/ 1,792 31,288
Becton Dickinson 2,025 118,503
INAMED /1/ 293 17,826
Johnson & Johnson 17,340 1,190,044
Zimmer Holdings /1/ 3,387 275,770
1,633,431
MEDICAL-BIOMEDICAL/GENE (0.77%)
Affymetrix /1/ 1,915 88,301
Amgen /1/ 5,530 321,901
Arqule /1/ 2,344 12,306
Charles River Laboratories
International /1/ 1,500 71,055
Exelixis /1/ 1,082 7,412
Genentech /1/ 1,706 121,023
Genzyme /1/ 2,070 121,323
Lexicon Genetics /1/ 2,566 11,239
Nektar Therapeutics /1/ 2,132 30,402
784,962
MEDICAL-DRUGS (2.19%)
Abbott Laboratories 8,323 409,159
Angiotech Pharmaceuticals /1/ 747 10,152
AstraZeneca 1,045 45,928
Bradley Pharmaceuticals /1/ 695 6,213
Eisai 2,362 78,418
Eli Lilly 1,255 73,380
GlaxoSmithKline 1,556 78,656
Medicis Pharmaceutical 1,750 49,175
Merck 3,641 123,430
Novartis 2,159 105,208
Novo Nordisk 705 35,863
Pfizer 35,862 974,370
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-DRUGS (CONTINUED)
$
Roche Holding 900 54,225
Sanofi-Aventis 1,351 59,944
Teva Pharmaceutical Industries 1,880 58,731
Wyeth 1,690 75,949
2,238,801
MEDICAL-HMO (1.46%)
Aetna 5,494 403,095
Coventry Health Care /1/ 1,441 98,608
Pacificare Health Systems /1/ 560 33,466
Sierra Health Services /1/ 1,173 75,881
UnitedHealth Group 5,397 510,070
WellChoice /1/ 701 39,396
WellPoint /1/ 2,600 332,150
1,492,666
MEDICAL-HOSPITALS (0.08%)
LifePoint Hospitals /1/ 1,254 55,740
United Surgical Partners
International /1/ 331 14,647
VCA Antech /1/ 668 15,551
85,938
MEDICAL-NURSING HOMES (0.02%)
Kindred Healthcare /1/ 691 22,734
METAL PROCESSORS & FABRICATION (0.12%)
Precision Castparts 620 45,669
Quanex 990 49,956
Worthington Industries 1,790 29,105
124,730
METAL-COPPER (0.16%)
Phelps Dodge 1,950 167,408
METAL-DIVERSIFIED (0.04%)
Inco /1/ 1,025 36,634
METAL-IRON (0.03%)
Cleveland-Cliffs 550 31,906
MISCELLANEOUS INVESTING (0.82%)
Alexandria Real Estate Equities 500 34,410
Archstone-Smith Trust 1,390 49,998
Brandywine Realty Trust 2,151 60,873
CBL & Associates Properties 510 39,459
Cousins Properties 1,003 27,081
Essex Property Trust 328 24,912
Gramercy Capital 980 19,482
Healthcare Realty Trust 772 29,807
Hospitality Properties Trust 643 26,864
Kimco Realty 1,030 57,052
Newcastle Investment 2,047 60,366
Pan Pacific Retail Properties 680 41,086
Parkway Properties 278 12,677
Prologis Trust 1,260 49,883
Simon Property Group 1,240 81,927
SL Green Realty 258 15,738
Tanger Factory Outlet Centers 556 12,877
Thornburg Mortgage 1,153 34,544
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MISCELLANEOUS INVESTING (CONTINUED)
$
Ventas 5,778 155,890
834,926
MONEY CENTER BANKS (2.07%)
ABN AMRO Holding 4,990 119,011
Bank of America 22,054 993,312
Barclays 3,628 150,562
Credit Suisse Group /1/ 3,710 156,265
HBOS 810 35,852
HSBC Holdings 430 34,422
JP Morgan Chase 11,908 422,615
Mitsubishi Tokyo Financial Group 7,655 66,216
UBS 1,621 130,166
2,108,421
MOTION PICTURES & SERVICES (0.03%)
Macrovision /1/ 1,272 26,012
MULTI-LINE INSURANCE (1.67%)
American International Group 10,893 553,909
AXA 3,146 77,769
Cigna 2,980 274,101
Cincinnati Financial 1,134 45,632
Hartford Financial Services Group 2,360 170,793
ING Groep 2,883 79,023
Loews 940 66,627
Prudential Financial 6,190 353,759
Zurich Financial Services 4,900 82,075
1,703,688
MULTIMEDIA (1.34%)
Gemstar-TV Guide International
/1/ 8,700 33,495
Journal Communications 512 7,885
McGraw-Hill 2,210 192,447
News 10,244 163,084
Time Warner /1/ 27,208 457,367
Viacom 1,180 40,852
Vivendi Universal /1/ 2,759 81,804
Walt Disney 14,930 394,152
1,371,086
NETWORKING PRODUCTS (0.55%)
Cisco Systems /1/ 31,220 539,482
Netgear /1/ 1,296 20,904
560,386
OFFICE AUTOMATION & EQUIPMENT (0.18%)
Canon 1,667 86,751
Imagistics International /1/ 394 10,579
Pitney Bowes 1,920 85,862
183,192
OFFICE SUPPLIES & FORMS (0.03%)
John H. Harland 962 34,632
OIL & GAS DRILLING (0.16%)
Grey Wolf /1/ 3,540 21,240
Nabors Industries /1/ 850 45,789
Rowan 1,260 33,428
Transocean /1/ 1,330 61,672
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL COMPANY-EXPLORATION & PRODUCTION (1.30%)
$
Anadarko Petroleum 1,190 86,918
Apache 5,142 289,443
Burlington Resources 4,043 196,530
Canadian Natural Resources 2,440 120,878
Devon Energy 2,500 112,925
EOG Resources 3,740 177,837
Houston Exploration /1/ 555 28,272
KCS Energy /1/ 1,551 21,776
Meridian Resource /1/ 2,830 11,433
Noble Energy 2,084 133,626
PetroKazakhstan 1,228 35,649
Pogo Producing 725 32,632
Talisman Energy 1,890 56,984
Unit /1/ 529 20,292
1,325,195
OIL COMPANY-INTEGRATED (3.63%)
BP Amoco 593 36,114
ChevronTexaco 8,757 455,364
ConocoPhillips 5,049 529,388
ENI 1,155 144,906
Exxon Mobil 32,288 1,841,385
Occidental Petroleum 4,446 306,774
Petro-Canada 592 32,844
Petroleo Brasileiro 1,170 49,058
Repsol YPF 5,290 133,784
Total 1,555 172,465
3,702,082
OIL FIELD MACHINERY & EQUIPMENT (0.13%)
Lone Star Technologies /1/ 591 23,014
Smith International 1,928 112,171
135,185
OIL REFINING & MARKETING (0.42%)
Frontier Oil 998 41,996
Premcor 1,290 85,333
Statoil 6,200 108,438
Tesoro Petroleum /1/ 1,319 50,043
Valero Energy 2,130 145,969
431,779
OIL-FIELD SERVICES (0.16%)
Baker Hughes 2,090 92,211
Cal Dive International /1/ 1,230 54,710
RPC 1,087 15,805
162,726
OPTICAL SUPPLIES (0.38%)
Advanced Medical Optics /1/ 1,005 37,165
Alcon 780 75,660
Bausch & Lomb 3,689 276,675
389,500
PAPER & RELATED PRODUCTS (0.27%)
Georgia-Pacific 5,520 189,170
MeadWestvaco 1,460 42,997
UPM-Kymmene Oyj 2,396 48,112
280,279
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PHARMACY SERVICES (0.30%)
$
Caremark Rx /1/ 6,028 241,422
Medco Health Solutions /1/ 1,190 60,654
302,076
PHYSICIAN PRACTICE MANAGEMENT (0.02%)
Pediatrix Medical Group /1/ 349 23,763
PIPELINES (0.28%)
Equitable Resources 650 37,466
Questar 4,167 243,353
280,819
POLLUTION CONTROL (0.00%)
Duratek /1/ 45 1,043
POULTRY (0.13%)
Pilgrims Pride 3,667 132,342
PRINTING-COMMERCIAL (0.03%)
Consolidated Graphics /1/ 675 30,983
PROPERTY & CASUALTY INSURANCE (0.41%)
Arch Capital Group /1/ 905 36,191
Chubb 1,775 145,160
Direct General 519 9,217
First American 609 21,802
Selective Insurance Group 400 17,660
State Auto Financial 1,150 31,326
W.R. Berkley 4,429 143,943
Zenith National Insurance 208 11,962
417,261
PUBLICLY TRADED INVESTMENT FUND (0.44%)
iShares Russell 1000 Value Index
Fund 1,890 122,510
iShares Russell 2000 Index Fund 1,388 159,967
iShares S&P SmallCap 600 Index
Fund 1,087 163,050
445,527
PUBLISHING-NEWSPAPERS (0.10%)
Journal Register /1/ 1,030 16,295
Washington Post 97 83,832
100,127
PUBLISHING-PERIODICALS (0.01%)
Playboy Enterprises /1/ 522 6,306
RACETRACKS (0.02%)
Penn National Gaming /1/ 718 22,617
RECREATIONAL CENTERS (0.01%)
Life Time Fitness /1/ 277 7,498
RECYCLING (0.02%)
Metal Management 1,215 24,507
REGIONAL BANKS (1.55%)
Comerica 2,470 141,432
KeyCorp 7,060 234,109
SunTrust Banks 1,600 116,528
U.S. Bancorp 5,924 165,280
Wachovia 9,480 485,186
Wells Fargo 7,305 437,862
1,580,397
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RENTAL-AUTO & EQUIPMENT (0.01%)
$
Rent-A-Center /1/ 368 8,847
RESORTS & THEME PARKS (0.03%)
Vail Resorts /1/ 1,132 29,285
RESPIRATORY PRODUCTS (0.05%)
Respironics /1/ 727 45,939
RETAIL-APPAREL & SHOE (0.75%)
Abercrombie & Fitch 3,118 168,216
Aeropostale /1/ 576 16,088
American Eagle Outfitters 6,730 176,460
Claire's Stores 2,210 48,222
Finish Line 688 12,398
Nordstrom 5,060 257,200
Stein Mart /1/ 1,451 29,397
Urban Outfitters /1/ 1,200 53,160
761,141
RETAIL-ARTS & CRAFTS (0.05%)
Michaels Stores 1,670 55,444
RETAIL-BOOKSTORE (0.02%)
Barnes & Noble /1/ 653 23,247
RETAIL-BUILDING PRODUCTS (0.39%)
Home Depot 10,265 363,073
Lowe's 743 38,718
401,791
RETAIL-CONVENIENCE STORE (0.06%)
7-Eleven /1/ 1,980 46,312
Pantry /1/ 397 12,712
59,024
RETAIL-DISCOUNT (0.75%)
Target 2,079 96,465
Wal-Mart Stores 14,098 664,580
761,045
RETAIL-DRUG STORE (0.02%)
CVS 350 18,053
RETAIL-JEWELRY (0.04%)
Signet Group 1,845 36,217
RETAIL-MAJOR DEPARTMENT STORE (0.16%)
J.C. Penney 3,350 158,824
RETAIL-MISCELLANEOUS/DIVERSIFIED (0.04%)
Ito-Yokado 1,077 37,264
RETAIL-MUSIC STORE (0.05%)
Guitar Center /1/ 1,060 52,311
RETAIL-OFFICE SUPPLIES (0.21%)
Staples 11,046 210,647
RETAIL-PAWN SHOPS (0.01%)
Cash America International 169 2,510
First Cash Financial Services /1/ 553 10,805
13,315
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-REGIONAL DEPARTMENT STORE (0.15%)
$
Dillard's 1,660 38,628
Federated Department Stores 1,250 71,875
Neiman Marcus Group 470 46,211
156,714
RETAIL-RESTAURANTS (0.77%)
Buffalo Wild Wings /1/ 348 10,586
California Pizza Kitchen /1/ 131 2,987
CEC Entertainment /1/ 421 15,240
CKE Restaurants /1/ 2,068 30,689
Dave & Buster's /1/ 435 7,330
Domino's Pizza 1,214 22,046
IHOP 286 11,698
Lone Star Steakhouse & Saloon 116 3,289
McDonald's 11,230 329,151
O'Charley's /1/ 495 9,870
Starbucks /1/ 3,618 179,163
Yum! Brands 3,551 166,755
788,804
RETAIL-SPORTING GOODS (0.01%)
Hibbett Sporting Goods /1/ 452 12,190
RUBBER-TIRES (0.06%)
Continental /1/ 862 63,314
SAVINGS & LOANS-THRIFTS (0.05%)
BankAtlantic Bancorp 390 6,653
BankUnited Financial 251 5,994
Downey Financial 111 7,185
Fidelity Bankshares 627 14,459
Sterling Financial /1/ 609 19,908
54,199
SCHOOLS (0.02%)
Education Management /1/ 716 20,048
SEMICONDUCTOR COMPONENT-INTEGRATED
CIRCUITS (0.23%)
Linear Technology 2,007 71,730
Maxim Integrated Products 1,263 47,236
Taiwan Semiconductor
Manufacturing 7,840 67,503
United Microelectronics /1/ 14,800 48,100
234,569
SEMICONDUCTOR EQUIPMENT (0.34%)
Applied Materials /1/ 12,708 188,968
ATMI /1/ 678 15,536
Kla-Tencor /1/ 1,500 58,530
MKS Instruments /1/ 441 6,527
Mykrolis /1/ 701 8,938
Novellus Systems /1/ 1,560 36,551
Rudolph Technologies /1/ 63 812
Varian Semiconductor Equipment
Associates /1/ 845 31,510
347,372
STEEL PRODUCERS (0.30%)
Arcelor 1,974 38,098
Nucor 2,340 119,574
POSCO 646 29,412
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
STEEL PRODUCERS (CONTINUED)
$
United States Steel 2,830 121,011
308,095
SUPERCONDUCTOR PRODUCTION & SYSTEMS (0.02%)
Intermagnetics General /1/ 1,013 24,879
TELECOMMUNICATION EQUIPMENT (0.51%)
Comtech Telecommunications /1/ 558 19,591
Comverse Technology /1/ 5,045 114,976
Harris 1,480 41,736
Plantronics 793 24,972
Qualcomm 5,696 198,733
Telefonaktiebolaget LM Ericsson
/1/ /4/ 3,830 112,793
Westell Technologies /1/ 2,128 11,023
523,824
TELECOMMUNICATION SERVICES (0.08%)
Amdocs /1/ 1,620 43,270
Intrado /1/ 519 6,545
Premiere Global Services /1/ 3,203 34,592
84,407
TELEPHONE-INTEGRATED (1.52%)
ALLTEL 3,980 226,701
AT&T 4,000 76,520
BellSouth 7,310 193,642
Citizens Communications 6,700 85,425
Nippon Telegraph & Telephone 1,630 33,985
SBC Communications 16,492 392,510
Sprint 8,629 192,081
Verizon Communications 9,715 347,797
1,548,661
TELEVISION (0.01%)
LIN Television /1/ 927 14,452
TEXTILE-APPAREL (0.00%)
Cherokee 31 1,009
THEATERS (0.01%)
Carmike Cinemas 241 8,435
THERAPEUTICS (0.32%)
Connetics /1/ 1,634 35,507
Dyax /1/ 1,949 7,757
Eyetech Pharmaceuticals /1/ 614 14,116
Gilead Sciences /1/ 6,929 257,066
NeoPharm /1/ 841 7,022
321,468
TOBACCO (0.95%)
Altria Group 11,621 755,249
British American Tobacco 1,846 69,520
Imperial Tobacco Group 1,810 104,998
Loews - Carolina Group 1,240 39,060
968,827
TOOLS-HAND HELD (0.04%)
Stanley Works 1,020 43,891
TOYS (0.00%)
Jakks Pacific /1/ 151 2,837
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TRANSACTIONAL SOFTWARE (0.03%)
Transaction Systems Architects $
/1/ 1,322 27,405
TRANSPORT-AIR FREIGHT (0.14%)
CNF 2,868 122,607
EGL /1/ 929 18,125
140,732
TRANSPORT-MARINE (0.02%)
Overseas Shipholding Group 346 19,525
TRANSPORT-RAIL (0.32%)
Burlington Northern Santa Fe 5,530 266,822
CSX 1,500 60,195
327,017
TRANSPORT-SERVICES (0.19%)
C.H. Robinson Worldwide 900 46,440
HUB Group /1/ 249 13,695
United Parcel Service 1,865 132,993
193,128
TRANSPORT-TRUCK (0.06%)
Forward Air 469 11,284
J.B. Hunt Transport Services 502 19,623
Overnite 948 28,421
SCS Transportation /1/ 325 4,970
64,298
TRUCKING & LEASING (0.01%)
Ryder System 251 9,269
WATER (0.05%)
Suez 1,696 46,521
WEB HOSTING & DESIGN (0.07%)
Macromedia /1/ 1,700 67,337
WEB PORTALS (0.29%)
Yahoo /1/ 8,697 300,133
WIRE & CABLE PRODUCTS (0.01%)
Belden CDT 722 13,241
WIRELESS EQUIPMENT (0.13%)
Motorola 6,047 92,761
Nokia 2,150 34,357
SpectraLink 859 9,543
136,661
TOTAL COMMON STOCKS 65,838,507
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (19.26%)
AGRICULTURAL CHEMICALS (0.06%)
IMC Global
$ $
7.63%; 11/01/05 60,000 60,900
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
AGRICULTURAL OPERATIONS (0.10%)
Bunge Limited Finance
$ $
4.38%; 12/15/08 80,000 79,758
5.88%; 05/15/13 25,000 26,445
106,203
AIRLINES (0.14%)
Southwest Airlines
5.10%; 05/01/06 141,942 142,775
ASSET BACKED SECURITIES (0.63%)
Chase Funding Mortgage Loan Asset
Backed Certificates
3.31%; 09/25/33 /5/ 84,711 84,856
Countrywide Asset Backed
Certificates
3.52%; 02/25/34 /5/ 196,429 196,419
4.09%; 01/25/34 /5/ 180,000 182,435
Master Adjustable Rate Mortgages
Trust
4.12%; 03/25/34 /5/ 95,000 95,579
MSDWCC Heloc Trust
3.21%; 07/25/17 /5/ 83,924 83,939
643,228
AUTO-CARS & LIGHT TRUCKS (0.10%)
DaimlerChrysler Holding
4.75%; 01/15/08 15,000 14,797
7.25%; 01/18/06 40,000 40,700
Nissan Motor Acceptance
4.63%; 03/08/10 /6/ 45,000 44,565
100,062
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.04%)
Lear
7.96%; 05/15/05 45,000 45,056
BREWERY (0.10%)
Cia Brasileira de Bebidas
10.50%; 12/15/11 40,000 48,400
Coors Brewing
6.38%; 05/15/12 50,000 54,407
102,807
BROADCASTING SERVICES & PROGRAMMING (0.08%)
Clear Channel Communications
4.50%; 01/15/10 60,000 57,431
Grupo Televisa
8.50%; 03/11/32 20,000 23,600
81,031
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.04%)
CRH America
5.30%; 10/15/13 25,000 25,425
6.40%; 10/15/33 10,000 11,024
36,449
BUILDING PRODUCTS-AIR & HEATING (0.08%)
York International
6.63%; 08/15/06 75,000 77,295
BUILDING PRODUCTS-WOOD (0.01%)
Celulosa Arauco y Constitucion
5.13%; 07/09/13 15,000 14,726
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
BUILDING-RESIDENTIAL & COMMERCIAL (0.09%)
DR Horton
$ $
8.50%; 04/15/12 50,000 54,665
Ryland Group
9.75%; 09/01/10 35,000 37,390
92,055
CABLE TV (0.40%)
Charter Communications
8.00%; 04/30/12 /6/ 35,000 33,600
Comcast
5.30%; 01/15/14 5,000 5,075
5.50%; 03/15/11 15,000 15,536
5.85%; 01/15/10 5,000 5,255
7.05%; 03/15/33 35,000 40,903
Cox Communications
3.55%; 12/14/07 /5/ /6/ 60,000 60,351
4.63%; 01/15/10 /6/ 85,000 83,741
6.75%; 03/15/11 45,000 48,616
7.13%; 10/01/12 50,000 55,558
EchoStar DBS
6.63%; 10/01/14 /6/ 60,000 58,200
406,835
CASINO HOTELS (0.25%)
Aztar
7.88%; 06/15/14 55,000 57,612
Boyd Gaming
9.25%; 08/01/09 40,000 42,200
Harrah's Operating
5.50%; 07/01/10 50,000 51,124
Mandalay Resort Group
6.45%; 02/01/06 25,000 25,281
MGM Mirage
7.25%; 10/15/06 35,000 35,963
Park Place Entertainment
8.50%; 11/15/06 45,000 47,475
259,655
CELLULAR TELECOMMUNICATIONS (0.40%)
America Movil
5.75%; 01/15/15 70,000 68,973
AT&T Wireless Services
8.13%; 05/01/12 65,000 76,849
Rogers Wireless Communications
7.25%; 12/15/12 55,000 56,237
Rural Cellular
8.25%; 03/15/12 20,000 20,250
Telus
7.50%; 06/01/07 40,000 42,474
8.00%; 06/01/11 10,000 11,550
US Unwired
7.26%; 06/15/10 /5/ 60,000 61,500
Verizon Wireless Capital
5.38%; 12/15/06 65,000 66,311
404,144
CHEMICALS-DIVERSIFIED (0.17%)
Chevron Phillips Chemical
7.00%; 03/15/11 50,000 55,577
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
CHEMICALS-DIVERSIFIED (CONTINUED)
FMC
$ $
6.75%; 05/05/05 55,000 55,000
ICI Wilmington I
5.63%; 12/01/13 30,000 30,457
Lyondell Chemical
9.50%; 12/15/08 30,000 31,988
173,022
COAL (0.03%)
Massey Energy
6.63%; 11/15/10 30,000 30,000
COATINGS & PAINT (0.03%)
Valspar
6.00%; 05/01/07 25,000 25,774
COMMERCIAL BANKS (0.07%)
United Overseas Bank
4.50%; 07/02/13 /6/ 20,000 19,138
Wachovia Bank
4.88%; 02/01/15 55,000 54,890
74,028
COMMERCIAL SERVICES (0.05%)
Iron Mountain
8.25%; 07/01/11 55,000 55,000
COMPUTER SERVICES (0.07%)
Unisys
7.88%; 04/01/08 35,000 34,781
8.13%; 06/01/06 35,000 35,700
70,481
COMPUTERS-INTEGRATED SYSTEMS (0.02%)
NCR
7.13%; 06/15/09 15,000 16,287
COMPUTERS-MEMORY DEVICES (0.05%)
Seagate Technology HDD Holdings
8.00%; 05/15/09 45,000 47,250
CREDIT CARD ASSET BACKED SECURITIES (0.94%)
American Express Credit Account
Master Trust
5.53%; 10/15/08 500,000 507,940
Capital One Multi-Asset Execution
Trust
3.17%; 12/15/09 /5/ 95,000 95,150
Chase Credit Card Master Trust
3.15%; 05/15/09 /5/ 100,000 99,981
Citibank Credit Card Master Trust
I
3.26%; 03/10/11 /5/ 75,000 75,380
Citibank Omni-S Master Trust
7.00%; 09/16/09 75,000 75,946
MBNA Credit Card Master Note
Trust
3.90%; 11/15/07 100,000 100,086
954,483
DATA PROCESSING & MANAGEMENT (0.02%)
Certegy
4.75%; 09/15/08 15,000 15,215
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
DISTRIBUTION-WHOLESALE (0.05%)
Ingram Micro
$ $
9.88%; 08/15/08 50,000 52,875
DIVERSIFIED FINANCIAL SERVICES (0.07%)
General Electric Capital
6.75%; 03/15/32 25,000 29,835
NiSource Finance
3.20%; 11/01/06 40,000 39,463
69,298
DIVERSIFIED MANUFACTURING OPERATIONS (0.04%)
Tyco International Group
6.38%; 02/15/06 40,000 40,763
DIVERSIFIED MINERALS (0.03%)
Vale Overseas
9.00%; 08/15/13 25,000 28,250
DIVERSIFIED OPERATIONS (0.05%)
Hutchison Whampoa International
6.50%; 02/13/13 /6/ 25,000 26,802
Noble Group
6.63%; 03/17/15 /6/ 30,000 26,742
53,544
E-COMMERCE-PRODUCTS (0.02%)
FTD
7.75%; 02/15/14 25,000 24,875
ELECTRIC-GENERATION (0.05%)
Korea East-West Power
4.88%; 04/21/11 /6/ 15,000 14,992
Tenaska Virginia Partners
6.12%; 03/30/24 /6/ 29,496 31,066
46,058
ELECTRIC-INTEGRATED (1.00%)
Arizona Public Service
5.80%; 06/30/14 35,000 37,026
6.50%; 03/01/12 20,000 22,015
Carolina Power & Light
6.65%; 04/01/08 40,000 42,385
Centerpoint Energy
5.88%; 06/01/08 25,000 25,874
Cincinnati Gas & Electric
5.40%; 06/15/33 15,000 14,683
Consumers Energy
4.25%; 04/15/08 10,000 9,942
Dayton Power & Light
5.13%; 10/01/13 /6/ 30,000 30,557
Entergy Gulf States
3.60%; 06/01/08 25,000 24,448
Exelon
6.75%; 05/01/11 30,000 32,928
FirstEnergy
6.45%; 11/15/11 55,000 59,070
Indianapolis Power & Light
7.38%; 08/01/07 35,000 36,685
Jersey Central Power & Light
5.63%; 05/01/16 15,000 15,525
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
ELECTRIC-INTEGRATED (CONTINUED)
Northeast Utilities
$ $
3.30%; 06/01/08 20,000 19,396
NorthWestern
5.88%; 11/01/14 /6/ 55,000 55,887
Ohio Power
4.85%; 01/15/14 20,000 19,854
Oncor Electric Delivery
6.38%; 05/01/12 45,000 48,936
Pacific Gas & Electric
3.60%; 03/01/09 25,000 24,314
6.05%; 03/01/34 85,000 90,826
Pepco Holdings
3.75%; 02/15/06 80,000 79,845
Pinnacle West Energy
3.63%; 04/01/07 /5/ /6/ 35,000 34,984
Power Contract Financing
5.20%; 02/01/06 /6/ 11,175 11,278
PPL Energy Supply
5.40%; 08/15/14 35,000 36,019
PSEG Power
6.95%; 06/01/12 50,000 55,738
Puget Energy
3.36%; 06/01/08 25,000 24,149
Southern California Edison
5.00%; 01/15/14 15,000 15,186
5.00%; 01/15/16 40,000 39,987
8.00%; 02/15/07 39,000 41,529
Southwestern Electric Power
4.50%; 07/01/05 50,000 50,086
TXU Energy
6.13%; 03/15/08 20,000 20,776
1,019,928
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.02%)
Flextronics International
6.50%; 05/15/13 25,000 23,875
ELECTRONICS-MILITARY (0.05%)
L-3 Communications
5.88%; 01/15/15 55,000 52,388
EXPORT/IMPORT BANK (0.03%)
Export-Import Bank of Korea
4.50%; 08/12/09 30,000 29,830
FEDERAL & FEDERALLY SPONSORED CREDIT (0.06%)
Housing Urban Development
2.99%; 08/01/05 60,000 59,974
FILTRATION & SEPARATION PRODUCTS (0.03%)
Polypore
8.75%; 05/15/12 35,000 29,575
FINANCE-AUTO LOANS (0.24%)
Ford Motor Credit
5.70%; 01/15/10 45,000 40,671
6.13%; 01/09/06 35,000 35,161
6.50%; 01/25/07 20,000 19,998
6.88%; 02/01/06 125,000 126,440
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-AUTO LOANS (CONTINUED)
Ford Motor Credit (continued)
$ $
7.88%; 06/15/10 25,000 24,060
246,330
FINANCE-CONSUMER LOANS (0.14%)
Household Finance
4.13%; 11/16/09 125,000 122,678
4.75%; 07/15/13 20,000 19,780
142,458
FINANCE-CREDIT CARD (0.21%)
Capital One Bank
5.00%; 06/15/09 30,000 30,341
6.88%; 02/01/06 100,000 102,230
Capital One Financial
4.80%; 02/21/12 15,000 14,761
MBNA
3.64%; 05/05/08 /5/ 65,000 64,961
212,293
FINANCE-INVESTMENT BANKER & BROKER (0.71%)
BCP Crystal U.S. Holdings
9.63%; 06/15/14 35,000 38,588
Bear Stearns
3.00%; 03/30/06 40,000 39,738
3.59%; 06/25/34 /5/ 70,000 69,903
Citigroup
5.88%; 02/22/33 20,000 20,972
E*Trade Financial
8.00%; 06/15/11 50,000 51,250
Goldman Sachs Group
3.88%; 01/15/09 35,000 34,351
5.13%; 01/15/15 80,000 79,894
6.60%; 01/15/12 110,000 120,924
Lehman Brothers Holdings
4.80%; 03/13/14 30,000 29,672
Merrill Lynch
3.02%; 02/06/09 /5/ 130,000 130,357
5.00%; 01/15/15 45,000 45,065
5.45%; 07/15/14 40,000 41,311
Morgan Stanley
5.30%; 03/01/13 25,000 25,548
727,573
FINANCE-MORTGAGE LOAN/BANKER (1.45%)
Countrywide Home Loan
4.25%; 12/19/07 25,000 24,887
4.61%; 12/19/33 /5/ 200,000 195,513
Federal Home Loan Mortgage
4.50%; 07/15/13 275,000 275,416
4.63%; 05/28/13 45,000 44,034
4.75%; 10/11/12 80,000 79,852
4.75%; 05/06/13 75,000 73,537
5.13%; 11/07/13 20,000 20,064
6.75%; 03/15/31 256,000 321,917
Federal National Mortgage
Association
2.88%; 05/19/08 50,000 48,319
3.70%; 11/01/07 230,000 227,515
4.32%; 07/26/07 90,000 90,173
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-MORTGAGE LOAN/BANKER (CONTINUED)
Federal National Mortgage
Association (continued)
$ $
4.75%; 02/21/13 75,000 74,563
1,475,790
FOOD-MISCELLANEOUS/DIVERSIFIED (0.13%)
Corn Products International
8.45%; 08/15/09 40,000 45,501
Kraft Foods
4.63%; 11/01/06 85,000 85,612
131,113
FOOD-RETAIL (0.05%)
Delhaize America
7.38%; 04/15/06 45,000 46,194
GAS-DISTRIBUTION (0.13%)
Colorado Interstate Gas
10.00%; 06/15/05 50,000 50,272
Sempra Energy
4.75%; 05/15/09 35,000 35,068
6.95%; 12/01/05 50,000 50,874
136,214
HOME DECORATION PRODUCTS (0.02%)
Newell Rubbermaid
4.00%; 05/01/10 10,000 9,731
4.63%; 12/15/09 15,000 14,984
24,715
HOME EQUITY-OTHER (0.61%)
ACE Securities
3.25%; 03/25/35 /5/ 50,000 50,063
Long Beach Mortgage Loan Trust
3.55%; 06/25/34 /5/ 25,000 25,063
4.10%; 06/25/34 /5/ 30,000 30,390
Option One Mortgage Loan Trust
3.32%; 11/25/34 /5/ 25,000 25,067
3.55%; 05/25/34 /5/ 70,000 70,286
4.07%; 05/25/34 /5/ 70,000 69,997
Saxon Asset Securities Trust
3.24%; 03/25/35 /5/ 100,000 100,089
Specialty Underwriting &
Residential Finance
3.27%; 03/25/36 /2/ /5/ 100,000 100,000
3.53%; 02/25/35 /5/ 65,000 65,221
Wells Fargo Home Equity Trust
3.52%; 04/25/34 /5/ 90,000 89,997
626,173
HOME EQUITY-SEQUENTIAL (0.21%)
Ameriquest Mortgage Securities
3.32%; 03/25/35 /5/ 96,779 96,862
New Century Home Equity Loan
Trust
3.74%; 01/25/34 /5/ 115,000 115,908
212,770
HOTELS & MOTELS (0.03%)
HMH Properties
7.88%; 08/01/08 28,000 28,560
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
INVESTMENT COMPANIES (0.08%)
Canadian Oil Sands
$ $
4.80%; 08/10/09 /6/ 80,000 80,068
LIFE & HEALTH INSURANCE (0.13%)
Hartford Life Global Funding
Trusts
3.18%; 09/15/09 /5/ 125,000 124,461
Nationwide Financial Services
5.63%; 02/13/15 10,000 10,298
134,759
MACHINERY TOOLS & RELATED PRODUCTS (0.06%)
Kennametal
7.20%; 06/15/12 55,000 61,181
MACHINERY-FARM (0.11%)
Case
7.25%; 08/01/05 75,000 75,375
Case New Holland
6.00%; 06/01/09 /6/ 40,000 36,900
112,275
MEDICAL INFORMATION SYSTEM (0.05%)
NDCHealth
10.50%; 12/01/12 50,000 52,750
MEDICAL PRODUCTS (0.03%)
Medical Device Manufacturing
10.00%; 07/15/12 25,000 26,750
MEDICAL-DRUGS (0.07%)
Biovail
7.88%; 04/01/10 45,000 44,775
Schering-Plough
5.55%; 12/01/13 30,000 31,132
75,907
MEDICAL-HMO (0.38%)
Anthem
4.88%; 08/01/05 200,000 200,455
Coventry Health Care
5.88%; 01/15/12 /6/ 75,000 74,625
Pacificare Health Systems
10.75%; 06/01/09 30,000 33,300
WellPoint
3.75%; 12/14/07 /6/ 30,000 29,636
4.25%; 12/15/09 /6/ 25,000 24,659
5.00%; 12/15/14 /6/ 25,000 25,188
387,863
MEDICAL-HOSPITALS (0.09%)
HCA
6.95%; 05/01/12 75,000 78,182
7.13%; 06/01/06 10,000 10,262
88,444
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.03%)
Bergen Brunswig
7.25%; 06/01/05 35,000 35,102
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
METAL PROCESSORS & FABRICATION (0.04%)
Mueller Group
$ $
10.00%; 05/01/12 35,000 37,625
METAL-DIVERSIFIED (0.03%)
Falconbridge
5.38%; 06/01/15 10,000 9,691
7.35%; 06/05/12 15,000 16,625
26,316
MISCELLANEOUS INVESTING (0.16%)
iStar Financial
3.30%; 03/03/08 /5/ 50,000 49,637
4.88%; 01/15/09 45,000 44,608
5.15%; 03/01/12 35,000 34,217
United Dominion Realty Trust
6.50%; 06/15/09 30,000 31,992
160,454
MISCELLANEOUS MANUFACTURERS (0.06%)
Samsonite
8.88%; 06/01/11 55,000 56,650
MONEY CENTER BANKS (0.18%)
JP Morgan Chase
4.75%; 03/01/15 75,000 73,724
5.25%; 05/01/15 105,000 107,210
180,934
MORTGAGE BACKED SECURITIES (3.03%)
Bear Stearns Adjustable Rate
Mortgage Trust
3.51%; 06/25/34 /5/ 50,000 48,788
Bear Stearns Commercial Mortgage
Securities
0.79%; 05/11/39 /5/ /6/ 448,646 11,249
5.47%; 06/11/41 110,000 114,651
Carrington Mortgage Loan Trust
3.28%; 01/25/35 /5/ 65,000 65,081
Commercial Mortgage Pass-Through
Certificate
4.05%; 10/15/37 160,000 157,039
CS First Boston Mortgage
Securities
0.08%; 11/15/37 /5/ /6/ 1,136,472 24,314
0.75%; 05/15/36 /5/ /6/ 827,328 16,050
0.87%; 07/15/36 /5/ /6/ 737,859 21,667
1.72%; 03/15/36 /5/ /6/ 430,667 20,100
3.62%; 05/25/34 /5/ 50,000 49,740
7.95%; 09/15/41 /5/ 25,000 28,154
DLJ Commercial Mortgage
6.59%; 02/18/31 700,000 742,083
DLJ Mortgage Acceptance
6.99%; 10/15/30 /6/ 100,000 104,107
First Union National Bank
Commercial Mortgage
8.09%; 05/17/32 40,000 45,715
Greenwich Capital Commercial
Funding
0.55%; 06/10/36 /5/ /6/ 4,711,000 77,670
IMPAC Commercial Mortgage Trust
3.33%; 04/25/35 /5/ 84,363 84,367
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
MORTGAGE BACKED SECURITIES (CONTINUED)
JP Morgan Chase Commercial
Mortgage Securities
$ $
0.05%; 01/15/42 /5/ /6/ 1,135,623 20,537
1.33%; 01/12/39 /5/ /6/ 617,049 30,246
6.04%; 11/15/35 150,000 156,938
LB-UBS Commercial Mortgage Trust
0.21%; 03/15/36 /5/ /6/ 356,536 10,235
0.86%; 03/15/34 /5/ /6/ 653,535 13,080
0.93%; 08/15/36 /5/ /6/ 565,325 17,497
1.37%; 03/15/36 /5/ /6/ 409,736 19,490
4.31%; 02/15/30 165,000 163,642
5.97%; 03/15/26 325,000 337,750
Merrill Lynch Mortgage Investors
3.20%; 02/25/36 /5/ 100,000 99,995
3.58%; 01/25/35 /5/ 90,000 89,996
Merrill Lynch Mortgage Trust
0.76%; 02/12/42 /5/ 1,464,720 31,710
Morgan Stanley Capital I
1.30%; 01/13/41 /5/ /6/ 425,000 20,043
Wachovia Bank Commercial
Mortgage Trust
0.47%; 03/15/42 /5/ /6/ 3,500,000 57,470
0.64%; 10/15/41 /5/ /6/ 2,439,378 57,147
Washington Mutual
3.40%; 01/25/45 /5/ 84,981 83,362
3.44%; 07/25/44 /5/ 93,968 94,292
3.81%; 06/25/34 /5/ 70,000 68,397
3.97%; 03/25/33 72,000 71,205
4.69%; 05/25/35 /2/ 35,000 34,871
3,088,678
MULTI-LINE INSURANCE (0.30%)
CNA Financial
5.85%; 12/15/14 55,000 55,731
Metropolitan Life Global Funding
I
3.18%; 03/17/09 /5/ /6/ 130,000 129,895
XL Capital
5.25%; 09/15/14 100,000 99,482
6.50%; 01/15/12 20,000 21,450
306,558
MULTIMEDIA (0.31%)
AOL Time Warner
5.63%; 05/01/05 20,000 20,000
6.15%; 05/01/07 70,000 72,530
7.63%; 04/15/31 95,000 115,767
News America
4.75%; 03/15/10 15,000 15,074
5.30%; 12/15/14 30,000 30,050
6.20%; 12/15/34 25,000 25,222
6.63%; 01/09/08 35,000 36,853
315,496
MUTUAL INSURANCE (0.13%)
Liberty Mutual Group
5.75%; 03/15/14 /6/ 85,000 84,877
6.50%; 03/15/35 /6/ 25,000 24,231
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
MUTUAL INSURANCE (CONTINUED)
Liberty Mutual Group (continued)
$ $
7.00%; 03/15/34 /6/ 25,000 25,819
134,927
NON-FERROUS METALS (0.02%)
Coldelco
5.50%; 10/15/13 /6/ 20,000 20,608
NON-HAZARDOUS WASTE DISPOSAL (0.04%)
Allied Waste North America
5.75%; 02/15/11 20,000 17,550
Waste Management
5.00%; 03/15/14 20,000 19,858
37,408
OIL & GAS DRILLING (0.07%)
Consolidated Natural Gas
5.00%; 03/01/14 25,000 24,958
Precision Drilling
5.63%; 06/01/14 40,000 41,500
66,458
OIL COMPANY-EXPLORATION & PRODUCTION (0.25%)
Chesapeake Energy
8.13%; 04/01/11 35,000 36,750
Devon Financing
7.88%; 09/30/31 40,000 50,439
Husky Energy
6.15%; 06/15/19 35,000 37,200
Nexen
5.05%; 11/20/13 40,000 39,845
7.88%; 03/15/32 25,000 30,674
Pioneer Natural Resources
5.88%; 07/15/16 65,000 64,442
259,350
OIL COMPANY-INTEGRATED (0.22%)
Amerada Hess
7.30%; 08/15/31 50,000 57,153
Occidental Petroleum
4.00%; 11/30/07 25,000 24,809
PanCanadian Energy
7.20%; 11/01/31 35,000 42,412
Petrobras International Finance
8.38%; 12/10/18 40,000 40,850
9.13%; 07/02/13 30,000 32,850
Petronas Capital
7.88%; 05/22/22 /6/ 20,000 24,531
222,605
OIL FIELD MACHINERY & EQUIPMENT (0.05%)
Cooper Cameron
2.65%; 04/15/07 50,000 48,384
OIL REFINING & MARKETING (0.22%)
Enterprise Products Operating
4.00%; 10/15/07 50,000 49,087
5.75%; 03/01/35 /6/ 25,000 23,253
Enterprise Products Partners
6.38%; 02/01/13 15,000 15,997
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
OIL REFINING & MARKETING (CONTINUED)
Tesoro Petroleum
$ $
8.00%; 04/15/08 40,000 41,900
9.63%; 11/01/08 35,000 37,275
Valero Energy
6.88%; 04/15/12 55,000 60,466
227,978
PAPER & RELATED PRODUCTS (0.13%)
Georgia-Pacific
8.63%; 04/30/25 15,000 15,632
Norske Skogindustrier
7.63%; 10/15/11 /6/ 50,000 56,559
Sappi Papier Holding
6.75%; 06/15/12 /6/ 20,000 21,732
Smurfit Capital Funding
6.75%; 11/20/05 40,000 40,000
133,923
PHARMACY SERVICES (0.05%)
Medco Health Solutions
7.25%; 08/15/13 50,000 55,576
PHYSICAL THERAPY & REHABILITATION
CENTERS (0.08%)
HealthSouth
6.88%; 06/15/05 80,000 80,000
PIPELINES (0.26%)
Buckeye Partners
4.63%; 07/15/13 35,000 34,124
Enbridge Energy Partners
4.00%; 01/15/09 15,000 14,649
National Fuel Gas
5.25%; 03/01/13 25,000 25,484
PG&E Gas Transmission
7.10%; 06/01/05 75,000 75,210
TEPPCO Partners
6.13%; 02/01/13 45,000 47,636
Texas Eastern Transmission
5.25%; 07/15/07 50,000 50,921
TGT Pipeline
5.50%; 02/01/17 /6/ 20,000 20,414
268,438
PROPERTY & CASUALTY INSURANCE (0.48%)
ACE
6.00%; 04/01/07 70,000 71,903
Arch Capital Group
7.35%; 05/01/34 75,000 83,601
Infinity Property & Casualty
5.50%; 02/18/14 55,000 54,430
Markel
6.80%; 02/15/13 80,000 87,279
St. Paul
5.75%; 03/15/07 80,000 82,055
W.R. Berkley
5.13%; 09/30/10 90,000 90,278
5.88%; 02/15/13 20,000 20,695
490,241
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
RECREATIONAL CENTERS (0.04%)
AMF Bowling Worldwide
$ $
10.00%; 03/01/10 45,000 45,000
REGIONAL BANKS (0.27%)
PNC Funding
5.75%; 08/01/06 100,000 102,196
Wachovia
5.25%; 08/01/14 40,000 40,968
5.63%; 12/15/08 100,000 105,027
Wells Fargo
3.12%; 08/15/08 30,000 29,004
277,195
REINSURANCE (0.13%)
Berkshire Hathaway Finance
4.63%; 10/15/13 55,000 54,169
Endurance Specialty Holdings
7.00%; 07/15/34 70,000 77,280
131,449
RENTAL-AUTO & EQUIPMENT (0.02%)
United Rentals
6.50%; 02/15/12 20,000 19,050
RETAIL-ARTS & CRAFTS (0.05%)
Michaels Stores
9.25%; 07/01/09 50,000 52,625
RETAIL-AUTO PARTS (0.02%)
PEP Boys-Manny, Moe & Jack
7.50%; 12/15/14 25,000 24,000
RETAIL-DISCOUNT (0.04%)
Dollar General
8.63%; 06/15/10 35,000 38,850
RETAIL-DRUG STORE (0.05%)
Rite Aid
12.50%; 09/15/06 50,000 54,500
RETAIL-MAJOR DEPARTMENT STORE (0.12%)
J.C. Penney
8.13%; 04/01/27 45,000 45,112
May Department Stores
5.75%; 07/15/14 75,000 77,658
122,770
RETAIL-VITAMINS & NUTRITIONAL SUPPLIES (0.04%)
General Nutrition Centers
8.63%; 01/15/11 /6/ 50,000 44,500
SAVINGS & LOANS-THRIFTS (0.02%)
Washington Mutual Bank
5.50%; 01/15/13 15,000 15,516
SOVEREIGN (0.29%)
Mexico Government
3.84%; 01/13/09 /5/ 50,000 50,600
8.30%; 08/15/31 35,000 40,994
8.38%; 01/14/11 140,000 160,230
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
SOVEREIGN (CONTINUED)
South Africa Government
$ $
6.50%; 06/02/14 40,000 43,200
295,024
SPECIAL PURPOSE ENTITY (0.18%)
Borden US Finance/Nova Scotia
Finance
9.00%; 07/15/14 /6/ 40,000 40,000
Fondo Latinoamericano de Reservas
3.00%; 08/01/06 /6/ 45,000 44,577
Jostens
7.63%; 10/01/12 50,000 50,000
K&F Acquisition
7.75%; 11/15/14 /6/ 55,000 53,900
188,477
STEEL PRODUCERS (0.07%)
International Steel Group
6.50%; 04/15/14 75,000 74,438
SUPRANATIONAL BANK (0.05%)
Corp Andina de Fomento
6.88%; 03/15/12 45,000 49,977
TELEPHONE-INTEGRATED (1.15%)
BellSouth
4.75%; 11/15/12 40,000 39,792
6.88%; 10/15/31 25,000 28,764
British Telecommunications
7.88%; 12/15/05 230,000 235,762
France Telecom
8.00%; 03/01/11 /5/ 185,000 213,202
MCI
6.91%; 05/01/07 /5/ 70,000 71,050
Qwest
7.88%; 09/01/11 /6/ 50,000 50,750
Sprint Capital
6.88%; 11/15/28 75,000 83,631
6.90%; 05/01/19 30,000 33,522
Telecom Italia Capital
4.00%; 01/15/10 /6/ 220,000 212,521
5.25%; 11/15/13 50,000 50,091
Telefonos de Mexico
4.50%; 11/19/08 10,000 9,849
8.25%; 01/26/06 100,000 103,165
Verizon Virginia
4.63%; 03/15/13 40,000 38,747
1,170,846
TEXTILE-HOME FURNISHINGS (0.03%)
Mohawk Industries
6.50%; 04/15/07 30,000 31,306
THEATERS (0.03%)
Cinemark
0.00%; 03/15/14 /1/ /5/ 50,000 34,375
TRANSPORT-RAIL (0.01%)
Union Pacific
4.70%; 01/02/24 15,000 14,498
Principal
Amount Value
- -----------------------------------------------------------------------------------------
BONDS (CONTINUED)
TRANSPORT-SERVICES (0.02%)
FedEx
$ $
3.50%; 04/01/09 20,000 19,371
VITAMINS & NUTRITION PRODUCTS (0.05%)
NBTY
8.63%; 09/15/07 30,000 30,075
WH Holdings/WH Capital
9.50%; 04/01/11 17,000 18,105
48,180
WIRE & CABLE PRODUCTS (0.04%)
Superior Essex Communications
9.00%; 04/15/12 40,000 40,400
TOTAL BONDS 19,642,230
Principal
Amount Value
- -----------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION
(FHLMC) CERTIFICATES (3.75%)
5.00%; 12/01/17 110,986 112,035
5.00%; 03/01/18 127,507 128,650
5.00%; 05/01/18 821,434 828,801
5.00%; 06/01/34 889,013 880,824
5.50%; 03/01/33 169,935 172,034
5.50%; 05/01/33 559,509 566,419
5.50%; 10/01/33 163,934 165,959
6.00%; 01/01/29 106,147 109,290
6.00%; 05/01/35 /7/ 400,000 410,500
6.50%; 12/01/20 29,585 30,787
6.50%; 05/01/31 55,406 57,684
6.50%; 06/01/31 83,263 86,686
7.00%; 12/01/27 87,400 92,501
7.00%; 09/01/31 29,969 31,653
7.50%; 11/01/30 20,044 21,516
7.50%; 11/01/30 10,802 11,595
7.50%; 01/01/31 17,348 18,622
8.00%; 12/01/30 90,093 98,571
TOTAL FHLMC CERTIFICATES 3,824,127
FEDERAL NATIONAL MORTGAGE ASSOCIATION
(FNMA) CERTIFICATES (6.71%)
4.26%; 06/01/34 /5/ 56,002 56,014
4.35%; 12/01/34 /5/ 88,346 88,316
4.39%; 07/01/34 /5/ 33,939 33,935
4.50%; 05/01/10 200,189 200,543
4.50%; 05/01/20 /7/ 1,180,000 1,167,093
4.66%; 03/01/35 /5/ 84,059 84,459
5.00%; 03/01/18 90,932 91,703
5.00%; 07/01/35 /7/ 1,455,000 1,433,629
5.50%; 01/01/33 395,520 400,035
5.50%; 07/01/33 447,171 451,977
Principal
Amount Value
- -----------------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (CONTINUED)
$ $
5.50%; 09/01/33 387,294 391,457
6.00%; 06/01/06 6,087 6,154
6.00%; 04/01/08 54,727 56,497
6.00%; 03/01/09 1,152 1,201
6.00%; 05/01/09 49,245 51,365
6.00%; 05/01/09 26,604 27,749
6.00%; 11/01/09 1,804 1,882
6.00%; 11/01/09 35,338 36,859
6.00%; 12/01/09 6,059 6,279
6.00%; 05/01/10 16,887 17,610
6.00%; 12/01/33 221,631 227,783
6.00%; 05/01/35 /7/ 1,860,000 1,909,405
6.50%; 05/01/06 52,254 52,896
6.50%; 03/01/08 50,400 52,323
TOTAL FNMA CERTIFICATES 6,847,164
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
(GNMA) CERTIFICATES (1.01%)
6.00%; 06/20/26 133,778 138,238
6.00%; 09/20/26 88,519 91,453
6.00%; 06/20/27 51,806 53,533
6.00%; 06/15/32 42,505 43,889
6.00%; 12/15/33 130,034 134,245
6.50%; 10/20/31 176,068 183,842
6.50%; 05/15/32 235,828 247,036
7.00%; 05/15/31 48,524 51,457
7.00%; 02/15/32 80,258 85,062
TOTAL GNMA CERTIFICATES 1,028,755
Principal
Amount Value
- -----------------------------------------------------------------------------------------
TREASURY BONDS (4.62%)
U.S. Treasury
3.63%; 07/15/09 300,000 297,457
4.00%; 02/15/14 175,000 172,956
4.25%; 11/15/14 350,000 351,148
4.75%; 05/15/14 325,000 338,787
5.00%; 02/15/11 450,000 474,258
5.38%; 02/15/31 425,000 480,018
6.25%; 05/15/30 225,000 280,134
7.13%; 02/15/23 240,000 313,331
7.25%; 05/15/16 140,000 175,831
7.50%; 11/15/16 135,000 173,412
8.00%; 11/15/21 285,000 398,221
U.S. Treasury Inflation-Indexed
Obligations
2.00%; 01/15/14 181,620 188,566
3.63%; 01/15/08 445,121 478,766
3.88%; 01/15/09 116,929 129,220
4.25%; 01/15/10 227,958 260,762
Principal
Amount Value
- -----------------------------------------------------------------------------------------
TREASURY BONDS (CONTINUED)
U.S. Treasury Strip
$ $
0.00%; 02/15/15 /1/ 300,000 197,269
TOTAL TREASURY BONDS 4,710,136
Principal
Amount Value
- -----------------------------------------------------------------------------------------
COMMERCIAL PAPER (4.09%)
FINANCE-CREDIT CARD (1.30%)
American Express Credit
2.82%; 05/03/05 1,325,000 1,324,686
MONEY CENTER BANKS (2.79%)
Investment in Joint Trading
Account; Citicorp
2.95%; 05/02/05 2,846,377 2,846,377
TOTAL COMMERCIAL PAPER 4,171,063
Maturity
Amount Value
- -----------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (0.17%)
Deutsche Bank Securities; 2.96%;
dated 04/29/05 maturing 05/02/05
(collateralized by U.S. Treasury
Inflation-Indexed Obligation; $
$181,050; 07/15/12) /8/ $ 177,544 177,500
TOTAL REPURCHASE AGREEMENTS 177,500
------------
TOTAL PORTFOLIO INVESTMENTS (104.16%) 106,239,482
LIABILITIES, NET OF
CASH, RECEIVABLES
AND OTHER ASSETS
(-4.16%) (4,246,406)
TOTAL NET ASSETS (100.00%) $101,993,076
---------------
1 Non-income producing security.
2 Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of
these securities totaled $134,871 or 0.13% of net assets.
3 Security is illiquid.
4 Security or a portion of the security was on loan at the end of the period.
5 Variable rate.
6 Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. Unless otherwise
indicated, these securities are not considered to be illiquid. At the end of
the period, the value of these securities totaled $2,202,048 or 2.16% of net
assets.
7 Security was purchased in a "to-be-announced" ("TBA") transaction.
See Notes to Financial Statements.
8 Security was purchased with the cash proceeds from securities loans.
Unrealized Appreciation (Depreciation)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 7,719,090
Unrealized Depreciation (6,492,241)
-------------
Net Unrealized Appreciation (Depreciation) 1,226,849
Cost for federal income tax purposes $105,012,633
Investments for Sector (unaudited)
- -------------------------------------------------------------------------------
Percentage of
Sector Value Total Value
- -------------------------------------------------------------------------------
Financial $ 21,494,939 20.23%
Consumer, non-cyclical 14,983,031 14.10
Mortgage Securities 14,671,165 13.81
Communications 8,390,194 7.90
Consumer, Cyclical 8,028,344 7.56
Industrial 7,710,378 7.26
Technology 7,489,270 7.05
Energy 7,323,128 6.89
Government 6,581,524 6.19
Utilities 3,785,960 3.56
Basic Materials 2,696,416 2.54
Asset Backed Securities 2,420,206 2.28
Funds 445,527 0.42
Diversified 219,400 0.21
-------------- -----------
Total $106,239,482 100.00%
Percentages are adjusted to reflect the impact of currency contracts, futures
contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL BOND FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (56.53%)
AGRICULTURAL OPERATIONS (0.29%)
Bunge Limited Finance
$ $
4.38%; 12/15/08 430,000 428,700
5.88%; 05/15/13 160,000 169,248
597,948
AIRLINES (0.09%)
Southwest Airlines
5.10%; 05/01/06 181,686 182,752
APPAREL MANUFACTURERS (0.06%)
Phillips Van-Heusen
7.75%; 11/15/23 125,000 128,750
ASSET BACKED SECURITIES (2.53%)
Bear Stearns Asset Backed Securities
3.26%; 02/25/35 /1/ 625,000 625,309
3.62%; 03/25/34 /1/ 515,000 514,975
Chase Funding Mortgage Loan Asset Backed
Certificates
3.31%; 09/25/33 /1/ 338,843 339,424
3.52%; 09/25/33 /1/ 420,000 420,580
Countrywide Asset Backed Certificates
3.34%; 08/25/32 /1/ 250,000 250,461
3.61%; 04/25/30 490,000 488,405
Financial Asset Securities Corp. AAA Trust
3.31%; 02/27/35 /1/ /2/ 300,000 300,020
Master Adjustable Rate Mortgages Trust
4.12%; 03/25/34 /1/ 545,000 548,321
Master Asset Backed Securities Trust
3.25%; 12/25/34 /1/ 750,000 751,069
Morgan Stanley ABS Capital I
3.24%; 12/25/34 /1/ 500,000 500,751
MSDWCC Heloc Trust
3.21%; 07/25/17 /1/ 468,988 469,072
5,208,387
AUTO-CARS & LIGHT TRUCKS (0.59%)
DaimlerChrysler Holding
3.77%; 08/08/06 /1/ 650,000 653,543
4.75%; 01/15/08 75,000 73,986
7.25%; 01/18/06 225,000 228,939
Nissan Motor Acceptance
4.63%; 03/08/10 /2/ 255,000 252,534
1,209,002
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.04%)
Navistar International
6.25%; 03/01/12 /2/ 100,000 88,000
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.41%)
ArvinMeritor
6.80%; 02/15/09 150,000 138,375
Delphi Automotive Systems
6.55%; 06/15/06 100,000 93,500
Lear
7.96%; 05/15/05 320,000 320,398
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (CONTINUED)
Polypore International
$ $
0.00%; 10/01/12 /1/ /2/ /3/ 125,000 70,000
Stanadyne
10.00%; 08/15/14 150,000 145,500
Tenneco Automotive
8.63%; 11/15/14 /2/ 75,000 68,438
836,211
AUTOMOBILE SEQUENTIAL (0.39%)
Capital Auto Receivables Asset Trust
4.50%; 10/15/07 567,910 568,992
Toyota Auto Receivables Owner Trust
2.65%; 11/15/06 231,365 231,070
800,062
BREWERY (0.31%)
Cia Brasileira de Bebidas
10.50%; 12/15/11 300,000 363,000
Coors Brewing
6.38%; 05/15/12 245,000 266,596
629,596
BROADCASTING SERVICES & PROGRAMMING (0.22%)
Clear Channel Communications
4.50%; 01/15/10 350,000 335,016
Grupo Televisa
8.50%; 03/11/32 100,000 118,000
453,016
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.12%)
Associated Materials
0.00%; 03/01/14 /1/ /3/ 210,000 141,750
CRH America
6.40%; 10/15/33 95,000 104,734
246,484
BUILDING PRODUCTS-AIR & HEATING (0.10%)
York International
6.63%; 08/15/06 200,000 206,121
BUILDING PRODUCTS-WOOD (0.04%)
Celulosa Arauco y Constitucion
5.13%; 07/09/13 90,000 88,356
BUILDING-RESIDENTIAL & COMMERCIAL (0.21%)
Beazer Homes
8.38%; 04/15/12 200,000 212,000
Ryland Group
9.75%; 09/01/10 210,000 224,340
436,340
CABLE TV (1.12%)
Charter Communications
8.38%; 04/30/14 /2/ 150,000 144,000
Comcast
5.30%; 01/15/14 50,000 50,751
5.50%; 03/15/11 150,000 155,356
5.85%; 01/15/10 30,000 31,532
7.05%; 03/15/33 175,000 204,516
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
CABLE TV (CONTINUED)
Cox Communications
$ $
3.55%; 12/14/07 /1/ /2/ 350,000 352,049
4.63%; 01/15/10 /2/ 475,000 467,964
6.75%; 03/15/11 305,000 329,505
7.13%; 10/01/12 200,000 222,231
EchoStar DBS
6.63%; 10/01/14 /2/ 200,000 194,000
Kabel Deutschland
10.63%; 07/01/14 /2/ 150,000 158,250
2,310,154
CASINO HOTELS (0.46%)
Ameristar Casinos
10.75%; 02/15/09 150,000 163,125
Aztar
9.00%; 08/15/11 205,000 219,350
Boyd Gaming
9.25%; 08/01/09 250,000 263,750
Harrah's Operating
5.50%; 07/01/10 290,000 296,519
942,744
CELLULAR TELECOMMUNICATIONS (1.06%)
America Movil
5.50%; 03/01/14 435,000 423,997
6.38%; 03/01/35 70,000 65,038
AT&T Wireless Services
8.13%; 05/01/12 480,000 567,497
Rural Cellular
8.25%; 03/15/12 120,000 121,500
Telus
7.50%; 06/01/07 445,000 472,522
8.00%; 06/01/11 40,000 46,200
Verizon Wireless Capital
5.38%; 12/15/06 480,000 489,682
2,186,436
CHEMICALS-DIVERSIFIED (0.60%)
Chevron Phillips Chemical
5.38%; 06/15/07 240,000 245,075
7.00%; 03/15/11 265,000 294,559
FMC
6.75%; 05/05/05 315,000 315,000
ICI Wilmington I
5.63%; 12/01/13 220,000 223,351
Lyondell Chemical
9.50%; 12/15/08 150,000 159,938
1,237,923
CHEMICALS-SPECIALTY (0.18%)
Hercules
6.75%; 10/15/29 100,000 97,250
Nalco
7.75%; 11/15/11 100,000 102,000
Westlake Chemical
8.75%; 07/15/11 150,000 163,125
362,375
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
COAL (0.17%)
Alpha Natural Resources
$ $
10.00%; 06/01/12 /2/ 210,000 233,100
Massey Energy
6.63%; 11/15/10 120,000 120,000
353,100
COATINGS & PAINT (0.16%)
Resolution Performance Products
8.00%; 12/15/09 150,000 156,375
Valspar
6.00%; 05/01/07 160,000 164,953
321,328
COMMERCIAL BANKS (0.22%)
United Overseas Bank
4.50%; 07/02/13 /2/ 150,000 143,532
Wachovia Bank
4.88%; 02/01/15 315,000 314,372
457,904
COMMERCIAL MORTGAGE BACKED SECURITY (0.25%)
Structured Adjustable Rate Mortgage Loan Trust
3.27%; 03/25/35 /1/ /4/ 525,000 525,000
COMMERCIAL SERVICES (0.22%)
Iron Mountain
6.63%; 01/01/16 150,000 133,500
8.25%; 07/01/11 315,000 315,000
448,500
COMPUTER SERVICES (0.11%)
Unisys
7.88%; 04/01/08 220,000 218,625
COMPUTERS-INTEGRATED SYSTEMS (0.04%)
NCR
7.13%; 06/15/09 75,000 81,435
CONTAINERS-METAL & GLASS (0.19%)
Crown European Holdings
10.88%; 03/01/13 150,000 171,375
Owens-Brockway
8.75%; 11/15/12 200,000 218,000
389,375
CONTAINERS-PAPER & PLASTIC (0.10%)
Intertape Polymer Group
8.50%; 08/01/14 200,000 199,666
CREDIT CARD ASSET BACKED SECURITIES (1.52%)
American Express Credit Account Master Trust
3.20%; 09/15/11 /1/ 200,000 200,856
Capital One Multi-Asset Execution Trust
3.17%; 12/15/09 /1/ 550,000 550,866
Chase Credit Card Master Trust
3.15%; 05/15/09 /1/ 750,000 749,854
Citibank Credit Card Master Trust I
3.26%; 03/10/11 /1/ 425,000 427,154
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
CREDIT CARD ASSET BACKED SECURITIES (CONTINUED)
Citibank Omni-S Master Trust
$ $
7.00%; 09/16/09 525,000 531,622
First USA Credit Card Master Trust
3.33%; 04/18/11 /1/ 650,000 654,967
3,115,319
DATA PROCESSING & MANAGEMENT (0.07%)
Certegy
4.75%; 09/15/08 135,000 136,935
DIALYSIS CENTERS (0.06%)
DaVita
7.25%; 03/15/15 /2/ 125,000 121,562
DISTRIBUTION-WHOLESALE (0.12%)
Ingram Micro
9.88%; 08/15/08 225,000 237,937
DIVERSIFIED FINANCIAL SERVICES (0.23%)
General Electric Capital
0.87%; 03/10/40 /1/ /2/ 7,517,917 209,103
6.75%; 03/15/32 125,000 149,173
NiSource Finance
3.20%; 11/01/06 120,000 118,391
476,667
DIVERSIFIED MANUFACTURING OPERATIONS (0.30%)
Invensys
9.88%; 03/15/11 /2/ 125,000 123,750
J.B. Poindexter
8.75%; 03/15/14 /2/ 200,000 194,000
Tyco International Group
6.38%; 02/15/06 300,000 305,725
623,475
DIVERSIFIED MINERALS (0.10%)
Vale Overseas
9.00%; 08/15/13 185,000 209,050
DIVERSIFIED OPERATIONS (0.20%)
Hutchison Whampoa International
6.50%; 02/13/13 /2/ 150,000 160,810
Noble Group
6.63%; 03/17/15 /2/ 280,000 249,594
410,404
ELECTRIC-GENERATION (0.16%)
CE Casecnan Water & Energy
11.45%; 11/15/05 85,725 85,725
Korea East-West Power
4.88%; 04/21/11 /2/ 85,000 84,955
Tenaska Virginia Partners
6.12%; 03/30/24 /2/ 157,309 165,683
336,363
ELECTRIC-INTEGRATED (3.44%)
Arizona Public Service
5.80%; 06/30/14 130,000 137,526
6.50%; 03/01/12 205,000 225,649
Centerpoint Energy
5.88%; 06/01/08 180,000 186,295
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
ELECTRIC-INTEGRATED (CONTINUED)
Consumers Energy
$ $
4.25%; 04/15/08 70,000 69,597
Dayton Power & Light
5.13%; 10/01/13 /2/ 200,000 203,710
Dominion Resources
3.09%; 05/15/06 /1/ 550,000 551,403
Entergy Gulf States
3.60%; 06/01/08 180,000 176,029
Exelon
6.75%; 05/01/11 200,000 219,521
FirstEnergy
6.45%; 11/15/11 325,000 349,048
FPL Group Capital
3.25%; 04/11/06 170,000 169,195
Georgia Power
2.99%; 02/17/09 /1/ 900,000 900,437
Indianapolis Power & Light
7.38%; 08/01/07 230,000 241,070
Jersey Central Power & Light
5.63%; 05/01/16 80,000 82,799
MidAmerican Energy Holdings
4.63%; 10/01/07 200,000 200,340
Northeast Utilities
3.30%; 06/01/08 145,000 140,618
Ohio Power
4.85%; 01/15/14 185,000 183,654
Oncor Electric Delivery
6.38%; 05/01/12 275,000 299,056
Pacific Gas & Electric
3.60%; 03/01/09 150,000 145,883
6.05%; 03/01/34 265,000 283,164
Pepco Holdings
3.75%; 02/15/06 565,000 563,908
Pinnacle West Energy
3.63%; 04/01/07 /1/ /2/ 210,000 209,901
Power Contract Financing
5.20%; 02/01/06 /2/ 78,224 78,947
PPL Energy Supply
5.40%; 08/15/14 200,000 205,821
PSEG Power
6.95%; 06/01/12 300,000 334,429
Puget Energy
3.36%; 06/01/08 175,000 169,044
Southern California Edison
5.00%; 01/15/14 85,000 86,052
5.00%; 01/15/16 225,000 224,928
8.00%; 02/15/07 38,000 40,464
Southwestern Electric Power
4.50%; 07/01/05 240,000 240,414
TXU Energy
6.13%; 03/15/08 140,000 145,430
7,064,332
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.07%)
Flextronics International
6.50%; 05/15/13 150,000 143,250
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
EXPORT/IMPORT BANK (0.12%)
Export-Import Bank of Korea
$ $
4.50%; 08/12/09 240,000 238,641
FEDERAL & FEDERALLY SPONSORED CREDIT (0.16%)
Housing Urban Development
2.99%; 08/01/05 325,000 324,862
FIDUCIARY BANKS (0.35%)
State Street Capital Trust II
3.29%; 02/15/08 /1/ 725,000 727,298
FINANCE-AUTO LOANS (0.73%)
Ford Motor Credit
6.13%; 01/09/06 225,000 226,034
6.88%; 02/01/06 160,000 161,843
7.25%; 10/25/11 450,000 415,934
7.88%; 06/15/10 160,000 153,983
General Motors Acceptance
4.39%; 10/20/05 /1/ 550,000 548,810
1,506,604
FINANCE-CONSUMER LOANS (0.78%)
Household Finance
4.13%; 12/15/08 200,000 197,696
4.13%; 11/16/09 350,000 343,499
4.75%; 07/15/13 155,000 153,294
7.00%; 05/15/12 125,000 141,010
HSBC Finance
3.08%; 11/16/09 /1/ 775,000 778,277
1,613,776
FINANCE-CREDIT CARD (0.54%)
Capital One Bank
5.00%; 06/15/09 240,000 242,728
6.88%; 02/01/06 435,000 444,700
Capital One Financial
4.80%; 02/21/12 80,000 78,725
MBNA
3.64%; 05/05/08 /1/ 350,000 349,793
1,115,946
FINANCE-INVESTMENT BANKER & BROKER (2.31%)
BCP Crystal U.S. Holdings
9.63%; 06/15/14 105,000 115,763
Bear Stearns
3.00%; 03/30/06 165,000 163,918
3.59%; 06/25/34 /1/ 425,000 424,411
Citigroup
6.63%; 06/15/32 110,000 126,468
Goldman Sachs Group
3.88%; 01/15/09 100,000 98,145
5.13%; 01/15/15 410,000 409,458
5.15%; 01/15/14 130,000 130,844
6.60%; 01/15/12 615,000 676,076
Lehman Brothers Holdings
4.80%; 03/13/14 170,000 168,141
Merrill Lynch
3.02%; 02/06/09 /1/ 775,000 777,131
5.00%; 01/15/15 250,000 250,363
5.45%; 07/15/14 215,000 222,046
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-INVESTMENT BANKER & BROKER (CONTINUED)
Morgan Stanley
$ $
1.06%; 04/15/34 /1/ /2/ 4,670,060 87,881
3.42%; 01/15/10 /1/ 925,000 927,226
5.30%; 03/01/13 165,000 168,614
4,746,485
FINANCE-MORTGAGE LOAN/BANKER (5.51%)
Countrywide Home Loan
3.40%; 06/02/06 /1/ 775,000 777,818
4.25%; 12/19/07 120,000 119,460
4.61%; 12/19/33 /1/ 1,000,000 977,563
Federal Home Loan Mortgage
2.65%; 05/30/08 275,000 263,828
3.40%; 06/15/23 /1/ 519,998 523,934
4.50%; 07/15/13 1,400,000 1,402,120
4.63%; 05/28/13 250,000 244,634
4.75%; 10/11/12 550,000 548,979
4.75%; 05/06/13 575,000 563,781
6.25%; 07/15/32 125,000 148,924
6.75%; 03/15/31 541,000 680,302
Federal National Mortgage Association
2.88%; 05/19/08 275,000 265,755
3.27%; 11/25/22 /1/ 419,796 420,290
3.70%; 11/01/07 1,430,000 1,414,550
4.32%; 07/26/07 530,000 531,019
4.75%; 02/21/13 550,000 546,796
6.25%; 05/15/29 1,000,000 1,178,381
Federal National Mortgage Association Whole
Loan
3.22%; 05/25/35 /1/ 722,962 722,952
11,331,086
FINANCE-OTHER SERVICES (0.06%)
Athena Neurosciences Finance
7.25%; 02/21/08 150,000 130,875
FOOD-MISCELLANEOUS/DIVERSIFIED (0.31%)
Corn Products International
8.45%; 08/15/09 265,000 301,447
Kraft Foods
4.63%; 11/01/06 325,000 327,338
628,785
FOOD-RETAIL (0.18%)
Delhaize America
7.38%; 04/15/06 360,000 369,554
GAS-DISTRIBUTION (0.36%)
Colorado Interstate Gas
10.00%; 06/15/05 250,000 251,361
Sempra Energy
4.75%; 05/15/09 200,000 200,389
6.95%; 12/01/05 275,000 279,808
731,558
HOME DECORATION PRODUCTS (0.09%)
Newell Rubbermaid
4.00%; 05/01/10 100,000 97,306
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
HOME DECORATION PRODUCTS (CONTINUED)
Newell Rubbermaid (continued)
$ $
4.63%; 12/15/09 85,000 84,909
182,215
HOME EQUITY-OTHER (1.81%)
ACE Securities
3.25%; 03/25/35 /1/ 250,000 250,316
Long Beach Mortgage Loan Trust
3.55%; 06/25/34 /1/ 140,000 140,356
4.10%; 06/25/34 /1/ 165,000 167,142
Option One Mortgage Loan Trust
3.32%; 11/25/34 /1/ 150,000 150,404
3.55%; 05/25/34 /1/ 400,000 401,635
4.07%; 05/25/34 /1/ 400,000 399,980
Saxon Asset Securities Trust
3.24%; 03/25/35 /1/ 625,000 625,558
4.15%; 03/25/35 /1/ 675,000 681,550
Specialty Underwriting & Residential Finance
3.27%; 03/25/36 /1/ /4/ 525,000 525,000
3.53%; 02/25/35 /1/ 385,000 386,307
3,728,248
HOME EQUITY-SEQUENTIAL (0.96%)
Ameriquest Mortgage Securities
3.32%; 03/25/35 /1/ 532,283 532,742
New Century Home Equity Loan Trust
3.31%; 03/25/35 /1/ 710,481 711,202
Residential Asset Securities
3.28%; 08/25/29 550,000 545,990
4.17%; 03/25/35 /1/ 175,000 175,129
1,965,063
HOTELS & MOTELS (0.07%)
HMH Properties
7.88%; 08/01/08 136,000 138,720
INDEPENDENT POWER PRODUCER (0.05%)
Reliant Energy
6.75%; 12/15/14 125,000 110,625
INDUSTRIAL AUTOMATION & ROBOTS (0.07%)
UNOVA
7.00%; 03/15/08 150,000 152,250
INSURANCE BROKERS (0.13%)
Marsh & McLennan
3.28%; 07/13/07 /1/ 275,000 273,195
INVESTMENT COMPANIES (0.22%)
Canadian Oil Sands
4.80%; 08/10/09 /2/ 450,000 450,381
LIFE & HEALTH INSURANCE (0.38%)
Hartford Life Global Funding Trusts
3.18%; 09/15/09 /1/ 725,000 721,873
Nationwide Financial Services
5.63%; 02/13/15 60,000 61,790
783,663
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MACHINERY TOOLS & RELATED PRODUCTS (0.18%)
Kennametal
$ $
7.20%; 06/15/12 325,000 361,522
MACHINERY-CONSTRUCTION & MINING (0.11%)
Terex
9.25%; 07/15/11 200,000 217,000
MACHINERY-FARM (0.04%)
Case New Holland
6.00%; 06/01/09 /2/ 100,000 92,250
MEDICAL INFORMATION SYSTEM (0.06%)
NDCHealth
10.50%; 12/01/12 125,000 131,875
MEDICAL PRODUCTS (0.08%)
Medical Device Manufacturing
10.00%; 07/15/12 150,000 160,500
MEDICAL-DRUGS (0.15%)
Biovail
7.88%; 04/01/10 125,000 124,375
Schering-Plough
5.55%; 12/01/13 185,000 191,978
316,353
MEDICAL-GENERIC DRUGS (0.07%)
Alpharma
8.63%; 05/01/11 /2/ 150,000 145,500
MEDICAL-HMO (0.75%)
Anthem
4.88%; 08/01/05 500,000 501,138
Coventry Health Care
5.88%; 01/15/12 /2/ 435,000 432,825
Pacificare Health Systems
10.75%; 06/01/09 150,000 166,500
WellPoint
3.75%; 12/14/07 /2/ 175,000 172,874
4.25%; 12/15/09 /2/ 130,000 128,228
5.00%; 12/15/14 /2/ 150,000 151,130
1,552,695
MEDICAL-HOSPITALS (0.41%)
HCA
5.25%; 11/06/08 210,000 209,933
6.95%; 05/01/12 120,000 125,091
7.13%; 06/01/06 225,000 230,886
8.36%; 04/15/24 150,000 163,424
United Surgical Partners International
10.00%; 12/15/11 100,000 110,000
839,334
MEDICAL-OUTPATIENT & HOME MEDICAL CARE (0.05%)
Select Medical
7.63%; 02/01/15 /2/ 100,000 98,250
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.10%)
Bergen Brunswig
7.25%; 06/01/05 210,000 210,609
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
METAL PROCESSORS & FABRICATION (0.22%)
Mueller Group
$ $
10.00%; 05/01/12 225,000 241,875
Trimas
9.88%; 06/15/12 125,000 123,125
Wolverine Tube
7.38%; 08/01/08 /2/ 100,000 91,000
456,000
METAL-ALUMINUM (0.05%)
Novelis
7.25%; 02/15/15 /2/ 100,000 96,750
METAL-DIVERSIFIED (0.09%)
Falconbridge
5.38%; 06/01/15 115,000 111,449
7.35%; 06/05/12 65,000 72,043
183,492
MISCELLANEOUS INVESTING (0.69%)
iStar Financial
3.30%; 03/03/08 /1/ 300,000 297,823
4.25%; 03/12/07 /1/ 300,000 303,957
4.88%; 01/15/09 280,000 277,562
5.15%; 03/01/12 180,000 175,971
Thornburg Mortgage
8.00%; 05/15/13 100,000 100,500
United Dominion Realty Trust
6.50%; 06/15/09 240,000 255,939
1,411,752
MISCELLANEOUS MANUFACTURERS (0.05%)
Propex Fabrics
10.00%; 12/01/12 100,000 95,000
MONEY CENTER BANKS (0.50%)
JP Morgan Chase
4.75%; 03/01/15 425,000 417,768
5.25%; 05/01/15 600,000 612,627
1,030,395
MORTGAGE BACKED SECURITIES (4.82%)
Banc of America Commercial Mortgage
0.04%; 11/10/38 /1/ /2/ 3,100,514 59,214
Bear Stearns Adjustable Rate Mortgage Trust
3.51%; 06/25/34 /1/ 245,000 239,059
Bear Stearns Commercial Mortgage Securities
0.79%; 05/11/39 /1/ /2/ 2,550,199 63,941
Carrington Mortgage Loan Trust
3.28%; 01/25/35 /1/ 350,000 350,436
CS First Boston Mortgage Securities
0.08%; 11/15/37 /1/ /2/ 5,682,359 121,568
0.75%; 05/15/36 /1/ /2/ 4,136,639 80,251
0.87%; 07/15/36 /1/ /2/ 4,099,216 120,373
1.72%; 03/15/36 /1/ /2/ 2,905,820 135,618
7.95%; 09/15/41 /1/ 125,000 140,769
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MORTGAGE BACKED SECURITIES (CONTINUED)
First Union National Bank Commercial Mortgage
$ $
8.09%; 05/17/32 200,000 228,574
GMAC Commercial Mortgage Securities
1.13%; 03/10/38 /1/ /2/ 3,762,360 143,587
GMAC Mortgage Corporation Loan Trust
3.22%; 08/25/35 /1/ /4/ 725,000 725,000
Greenwich Capital Commercial Funding
0.55%; 06/10/36 /1/ /2/ 27,190,000 448,282
IMPAC Commercial Mortgage Trust
3.17%; 08/25/35 /1/ /4/ /5/ 625,000 625,000
3.33%; 04/25/35 /1/ 471,442 471,461
Indymac Index Mortgage Loan Trust
3.29%; 04/25/35 /1/ /4/ 425,000 425,000
JP Morgan Chase Commercial Mortgage Securities
0.05%; 01/15/42 /1/ /2/ 5,962,023 107,817
1.33%; 01/12/39 /1/ /2/ 3,512,434 172,169
LB-UBS Commercial Mortgage Trust
0.21%; 03/15/36 /1/ /2/ 2,317,483 66,528
0.86%; 03/15/34 /1/ /2/ 3,006,262 60,167
0.93%; 08/15/36 /1/ /2/ 3,140,695 97,208
1.37%; 03/15/36 /1/ /2/ 2,212,572 105,248
Merrill Lynch Mortgage Investors
3.22%; 02/25/36 /1/ 525,000 524,975
3.58%; 01/25/35 /1/ 540,000 539,975
Merrill Lynch Mortgage Trust
0.76%; 02/12/42 /1/ 9,154,501 198,186
Morgan Stanley Capital I
1.30%; 01/13/41 /1/ /2/ 2,500,000 117,897
7.11%; 04/15/33 100,000 109,449
Wachovia Bank Commercial Mortgage Trust
0.47%; 03/15/42 /1/ /2/ 21,200,000 348,104
0.64%; 10/15/41 /1/ /2/ 13,619,859 319,072
Washington Mutual
3.26%; 04/25/45 /1/ /4/ 300,000 300,000
3.30%; 04/25/45 /1/ /4/ 300,000 300,000
3.40%; 01/25/45 /1/ 474,895 465,846
3.44%; 07/25/44 /1/ 587,301 589,329
3.81%; 06/25/34 /1/ 410,000 400,612
3.97%; 03/25/33 528,000 522,169
4.69%; 05/25/35 /4/ 185,000 184,317
9,907,201
MULTI-LINE INSURANCE (0.55%)
CNA Financial
5.85%; 12/15/14 325,000 329,321
XL Capital
5.25%; 09/15/14 655,000 651,608
6.50%; 01/15/12 145,000 155,508
1,136,437
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MULTIMEDIA (0.80%)
AOL Time Warner
$ $
7.63%; 04/15/31 620,000 755,531
News America
4.75%; 03/15/10 90,000 90,442
5.30%; 12/15/14 225,000 225,377
6.20%; 12/15/34 125,000 126,113
6.63%; 01/09/08 250,000 263,234
Walt Disney
5.38%; 06/01/07 175,000 178,840
1,639,537
MUSIC (0.04%)
Warner Music Group
7.38%; 04/15/14 75,000 75,000
MUTUAL INSURANCE (0.38%)
Liberty Mutual Group
5.75%; 03/15/14 /2/ 495,000 494,281
6.50%; 03/15/35 /2/ 150,000 145,385
7.00%; 03/15/34 /2/ 130,000 134,260
773,926
NON-FERROUS METALS (0.06%)
Coldelco
5.50%; 10/15/13 /2/ 125,000 128,799
NON-HAZARDOUS WASTE DISPOSAL (0.20%)
Allied Waste
8.50%; 12/01/08 150,000 152,812
Casella Waste Systems
9.75%; 02/01/13 125,000 136,563
Waste Management
5.00%; 03/15/14 125,000 124,110
413,485
OIL & GAS DRILLING (0.11%)
Precision Drilling
5.63%; 06/01/14 225,000 233,437
OIL COMPANY-EXPLORATION & PRODUCTION (1.15%)
Callon Petroleum
9.75%; 12/08/10 150,000 155,250
Chesapeake Energy
8.13%; 04/01/11 200,000 210,000
Devon Financing
7.88%; 09/30/31 165,000 208,061
Energy Partners
8.75%; 08/01/10 150,000 157,500
Husky Energy
6.15%; 06/15/19 200,000 212,571
Nexen
5.05%; 11/20/13 305,000 303,821
7.88%; 03/15/32 125,000 153,368
Paramount Resources
8.50%; 01/31/13 125,000 121,250
Pemex Project Funding Master Trust
8.00%; 11/15/11 250,000 278,250
Pioneer Natural Resources
5.88%; 07/15/16 380,000 376,738
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
OIL COMPANY-EXPLORATION & PRODUCTION (CONTINUED)
Swift Energy
$ $
9.38%; 05/01/12 125,000 133,750
XTO Energy
6.25%; 04/15/13 50,000 54,251
2,364,810
OIL COMPANY-INTEGRATED (0.54%)
Amerada Hess
7.30%; 08/15/31 275,000 314,340
Occidental Petroleum
4.00%; 11/30/07 175,000 173,661
Petrobras International Finance
8.38%; 12/10/18 225,000 229,781
9.13%; 02/01/07 225,000 241,875
Petronas Capital
7.88%; 05/22/22 /2/ 125,000 153,322
1,112,979
OIL FIELD MACHINERY & EQUIPMENT (0.14%)
Cooper Cameron
2.65%; 04/15/07 290,000 280,630
OIL REFINING & MARKETING (0.67%)
CITGO Petroleum
6.00%; 10/15/11 150,000 145,875
Enterprise Products Operating
4.00%; 10/15/07 280,000 274,889
5.75%; 03/01/35 /2/ 140,000 130,217
Enterprise Products Partners
6.38%; 02/01/13 110,000 117,313
Tesoro Petroleum
9.63%; 11/01/08 440,000 468,600
Valero Energy
6.88%; 04/15/12 225,000 247,359
1,384,253
OIL-FIELD SERVICES (0.38%)
Halliburton
4.65%; 10/17/05 /1/ 775,000 779,740
PAPER & RELATED PRODUCTS (0.65%)
Abitibi-Consolidated
8.38%; 04/01/15 100,000 91,250
Georgia-Pacific
8.63%; 04/30/25 75,000 78,158
Neenah Paper
7.38%; 11/15/14 /2/ 125,000 118,750
Norske Skogindustrier
7.63%; 10/15/11 /2/ 500,000 565,591
Sappi Papier Holding
6.75%; 06/15/12 /2/ 140,000 152,124
Smurfit Capital Funding
6.75%; 11/20/05 330,000 330,000
1,335,873
PHARMACY SERVICES (0.15%)
Medco Health Solutions
7.25%; 08/15/13 275,000 305,668
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
PHYSICAL THERAPY & REHABILITATION CENTERS (0.07%)
HealthSouth
$ $
7.63%; 06/01/12 150,000 144,000
PIPELINES (0.66%)
Buckeye Partners
4.63%; 07/15/13 275,000 268,115
Enbridge Energy Partners
4.00%; 01/15/09 90,000 87,892
National Fuel Gas
5.25%; 03/01/13 175,000 178,385
PG&E Gas Transmission
7.10%; 06/01/05 400,000 401,122
TEPPCO Partners
6.13%; 02/01/13 45,000 47,636
Texas Eastern Transmission
5.25%; 07/15/07 245,000 249,514
TGT Pipeline
5.50%; 02/01/17 /2/ 120,000 122,486
1,355,150
PRIVATE CORRECTIONS (0.05%)
Corrections Corporation of America
6.25%; 03/15/13 /2/ 100,000 96,500
PROPERTY & CASUALTY INSURANCE (1.31%)
ACE
6.00%; 04/01/07 150,000 154,077
Arch Capital Group
7.35%; 05/01/34 440,000 490,457
Infinity Property & Casualty
5.50%; 02/18/14 335,000 331,525
Markel
6.80%; 02/15/13 460,000 501,856
St. Paul
5.75%; 03/15/07 475,000 487,204
W.R. Berkley
5.13%; 09/30/10 575,000 576,778
5.88%; 02/15/13 155,000 160,388
2,702,285
PUBLISHING-PERIODICALS (0.12%)
American Media Operation
10.25%; 05/01/09 100,000 102,750
Dex Media West
9.88%; 08/15/13 123,000 136,530
239,280
QUARRYING (0.08%)
Compass Minerals International
0.00%; 06/01/13 /1/ /3/ 200,000 167,000
RECREATIONAL CENTERS (0.17%)
AMF Bowling Worldwide
10.00%; 03/01/10 200,000 200,000
Town Sports International
9.63%; 04/15/11 150,000 153,937
353,937
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
REGIONAL BANKS (0.78%)
PNC Funding
$ $
5.75%; 08/01/06 650,000 664,277
Wachovia
5.63%; 12/15/08 600,000 630,162
6.38%; 02/01/09 100,000 107,047
Wells Fargo
3.12%; 08/15/08 200,000 193,357
1,594,843
REINSURANCE (0.21%)
Endurance Specialty Holdings
7.00%; 07/15/34 385,000 425,040
RENTAL-AUTO & EQUIPMENT (0.09%)
NationsRent
9.50%; 05/01/15 /2/ 75,000 75,000
United Rentals
6.50%; 02/15/12 125,000 119,062
194,062
RESORTS & THEME PARKS (0.07%)
Intrawest
7.50%; 10/15/13 150,000 149,250
RETAIL-ARTS & CRAFTS (0.13%)
Michaels Stores
9.25%; 07/01/09 250,000 263,125
RETAIL-AUTOMOBILE (0.05%)
Asbury Automotive Group
9.00%; 06/15/12 100,000 98,500
RETAIL-DISCOUNT (0.11%)
Dollar General
8.63%; 06/15/10 200,000 222,000
RETAIL-DRUG STORE (0.08%)
Rite Aid
12.50%; 09/15/06 150,000 163,500
RETAIL-MAJOR DEPARTMENT STORE (0.21%)
May Department Stores
5.75%; 07/15/14 425,000 440,060
RETAIL-PROPANE DISTRIBUTION (0.18%)
AmeriGas Partners
8.88%; 05/20/11 150,000 162,750
Star Gas Partners
10.25%; 02/15/13 /2/ 120,000 104,100
Suburban Propane Partners/Suburban Energy
Finance
6.88%; 12/15/13 /2/ 100,000 96,000
362,850
RETAIL-VIDEO RENTAL (0.05%)
Movie Gallery
11.00%; 05/01/12 /2/ 100,000 98,875
RETAIL-VITAMINS & NUTRITIONAL SUPPLIES (0.03%)
General Nutrition Centers
8.63%; 01/15/11 /2/ 80,000 71,200
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
SATELLITE TELECOM (0.05%)
Intelsat
$ $
5.25%; 11/01/08 125,000 113,437
SAVINGS & LOANS-THRIFTS (0.40%)
Washington Mutual
3.44%; 01/15/10 /1/ 725,000 727,910
5.50%; 01/15/13 100,000 103,439
831,349
SCHOOLS (0.07%)
Knowledge Learning
7.75%; 02/01/15 /2/ 150,000 142,500
SEMICONDUCTOR EQUIPMENT (0.04%)
Amkor Technology
7.75%; 05/15/13 100,000 78,375
SOVEREIGN (0.80%)
Mexico Government
3.84%; 01/13/09 /1/ 300,000 303,600
8.30%; 08/15/31 260,000 304,525
8.38%; 01/14/11 690,000 789,705
South Africa Government
6.50%; 06/02/14 220,000 237,600
1,635,430
SPECIAL PURPOSE ENTITY (0.82%)
Da-Lite Screen
9.50%; 05/15/11 150,000 163,875
Farmers Exchange Capital
7.05%; 07/15/28 /2/ 225,000 237,715
Fondo Latinoamericano de Reservas
3.00%; 08/01/06 /2/ 270,000 267,462
John Hancock Global Funding II
3.29%; 04/03/09 /1/ /2/ 800,000 799,960
Jostens
7.63%; 10/01/12 120,000 120,000
K&F Acquisition
7.75%; 11/15/14 /2/ 100,000 98,000
1,687,012
SUPRANATIONAL BANK (0.12%)
Corp Andina de Fomento
6.88%; 03/15/12 230,000 255,440
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.08%)
Corning
8.30%; 04/04/25 150,000 156,707
TELEPHONE-INTEGRATED (3.10%)
BellSouth
4.75%; 11/15/12 250,000 248,699
6.88%; 10/15/31 130,000 149,574
British Telecommunications
7.88%; 12/15/05 940,000 963,552
France Telecom
8.00%; 03/01/11 /1/ 1,095,000 1,261,926
MCI
6.91%; 05/01/07 /1/ 250,000 253,750
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
TELEPHONE-INTEGRATED (CONTINUED)
Northwestern Bell Telephone
$ $
6.25%; 01/01/07 250,000 248,750
Qwest
6.63%; 09/15/05 200,000 201,000
Sprint Capital
6.88%; 11/15/28 325,000 362,402
6.90%; 05/01/19 100,000 111,740
8.75%; 03/15/32 230,000 309,276
Telecom Italia Capital
4.00%; 01/15/10 /2/ 1,275,000 1,231,654
5.25%; 11/15/13 280,000 280,509
Telefonos de Mexico
4.50%; 11/19/08 135,000 132,960
8.25%; 01/26/06 385,000 397,185
Verizon Virginia
4.63%; 03/15/13 225,000 217,950
6,370,927
TEXTILE-HOME FURNISHINGS (0.07%)
Mohawk Industries
6.50%; 04/15/07 145,000 151,310
THEATERS (0.05%)
Cinemark
0.00%; 03/15/14 /1/ /3/ 140,000 96,250
TRANSPORT-RAIL (0.08%)
Progress Rail Services/Progress Metal
Reclamation
7.75%; 04/01/12 /2/ 75,000 74,625
Union Pacific
4.70%; 01/02/24 100,000 96,655
171,280
TRANSPORT-SERVICES (0.07%)
CHC Helicopter
7.38%; 05/01/14 150,000 146,250
VETERINARY DIAGNOSTICS (0.08%)
VICAR Operating
9.88%; 12/01/09 150,000 162,562
VITAMINS & NUTRITION PRODUCTS (0.14%)
NBTY
8.63%; 09/15/07 200,000 200,500
WH Holdings/WH Capital
9.50%; 04/01/11 74,000 78,810
279,310
WIRE & CABLE PRODUCTS (0.10%)
Superior Essex Communications
9.00%; 04/15/12 200,000 202,000
WIRELESS EQUIPMENT (0.03%)
SBA Telecom/SBA Communications
0.00%; 12/15/11 /1/ /3/ 65,000 56,550
TOTAL BONDS 116,219,912
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) CERTIFICATES (11.25%)
$ $
4.50%; 12/01/09 1,253,076 1,255,904
4.50%; 11/01/18 2,219,967 2,202,340
5.00%; 01/01/18 3,237,073 3,267,660
5.00%; 05/01/18 1,738,384 1,753,976
5.50%; 05/01/17 1,293,351 1,325,770
5.50%; 06/01/24 4,528,115 4,588,104
5.50%; 04/01/33 1,344,835 1,361,445
6.00%; 03/01/22 961,511 986,391
6.00%; 03/01/31 201,776 207,373
6.00%; 04/01/31 45,414 46,674
6.00%; 12/01/31 903,389 928,450
6.00%; 05/01/35 /6/ 3,100,000 3,181,375
6.50%; 06/01/17 943,171 982,342
6.50%; 03/01/29 109,983 114,650
6.50%; 05/01/29 164,480 171,459
6.50%; 04/01/31 98,106 102,140
7.00%; 12/01/29 101,592 107,394
7.00%; 06/01/30 66,428 70,183
7.00%; 12/01/30 81,855 86,483
7.50%; 09/01/30 24,193 25,970
7.50%; 09/01/30 37,534 40,290
7.50%; 01/01/31 128,127 137,535
7.50%; 03/01/31 39,540 42,443
8.00%; 09/01/30 133,757 146,344
TOTAL FHLMC CERTIFICATES 23,132,695
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) CERTIFICATES (17.01%)
4.26%; 06/01/34 /1/ 316,993 317,062
4.35%; 12/01/34 /1/ 500,070 499,900
4.39%; 07/01/34 /1/ 192,112 192,086
4.66%; 03/01/35 /1/ 475,803 478,067
5.00%; 03/01/18 2,182,363 2,200,878
5.00%; 05/01/20 /6/ 3,350,000 3,373,031
5.00%; 07/01/35 /6/ 10,875,000 10,715,268
5.50%; 07/01/33 2,235,852 2,259,881
5.50%; 09/01/33 1,267,509 1,281,130
5.50%; 05/01/35 /6/ 5,000,000 5,046,875
6.00%; 05/01/09 184,669 190,644
6.00%; 07/01/09 367,222 383,031
6.00%; 07/01/09 227,587 234,950
6.00%; 05/01/32 171,056 175,838
6.00%; 05/01/35 /6/ 6,000,000 6,159,372
6.50%; 01/01/11 119,082 123,625
6.50%; 02/01/11 195,673 205,576
6.50%; 03/01/11 335,853 352,850
6.50%; 09/01/32 592,927 617,204
7.00%; 08/01/29 30,462 32,221
7.00%; 02/01/32 115,598 122,140
TOTAL FNMA CERTIFICATES 34,961,629
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) CERTIFICATES (3.45%)
$ $
5.50%; 05/01/35 /6/ 2,000,000 2,033,750
6.00%; 07/20/28 468,542 483,870
6.00%; 11/20/28 446,427 461,032
6.00%; 01/20/29 476,688 492,098
6.00%; 07/20/29 118,737 122,575
6.00%; 12/15/33 455,119 469,859
6.50%; 03/20/28 92,924 97,150
6.50%; 05/20/29 78,467 81,984
6.50%; 12/15/32 2,082,294 2,181,265
7.00%; 06/15/32 629,965 667,667
TOTAL GNMA CERTIFICATES 7,091,250
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
TREASURY BONDS (12.46%)
U.S. Treasury
3.63%; 07/15/09 2,100,000 2,082,198
4.00%; 02/15/14 1,100,000 1,087,152
4.25%; 11/15/14 2,000,000 2,006,562
4.75%; 05/15/14 1,000,000 1,042,422
5.00%; 02/15/11 1,500,000 1,580,859
5.38%; 02/15/31 3,205,000 3,619,897
6.13%; 08/15/29 25,000 30,510
6.25%; 08/15/23 1,100,000 1,321,977
6.25%; 05/15/30 1,310,000 1,631,001
6.75%; 08/15/26 1,000,000 1,287,305
7.50%; 11/15/16 1,770,000 2,273,620
8.00%; 11/15/21 1,210,000 1,690,692
U.S. Treasury Inflation-Indexed Obligations
2.00%; 01/15/14 1,141,613 1,185,271
3.38%; 01/15/07 1,936,576 2,032,421
4.25%; 01/15/10 2,393,559 2,738,007
TOTAL TREASURY BONDS 25,609,894
Shares
Held Value
- -------------------------------------------------------------------------------------------------
COMMON STOCKS (0.00%)
COMPUTER SERVICES (0.00%)
$
Decisionone /3/ /4/ 3,500 -
Decisionone /3/ /4/ 2,054 -
Decisionone /3/ /4/ 3,540 -
Decisionone /3/ /4/ 2,100 -
-
TOTAL COMMON STOCKS -
Principal
Amount Value
- -------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (11.62%)
FINANCE-CREDIT CARD (1.05%)
American Express Credit
$ $
2.82%; 05/03/05 2,150,000 2,149,489
FINANCE-INVESTMENT BANKER & BROKER (5.81%)
Citigroup Global Markets Holdings
2.93%; 05/02/05 1,350,000 1,349,780
Goldman Sachs Group
2.80%; 05/04/05 10,600,000 10,596,585
11,946,365
MONEY CENTER BANKS (4.76%)
Investment in Joint Trading Account; Citicorp
2.95%; 05/02/05 9,790,637 9,790,637
TOTAL COMMERCIAL PAPER 23,886,491
------------
TOTAL PORTFOLIO INVESTMENTS (112.32%) 230,901,871
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER ASSETS (-12.32%) (25,333,273)
TOTAL NET ASSETS (100.00%) $205,568,598
---------------
/1 /Variable rate.
/2 /Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from registration,
normally to qualified institutional buyers. Unless otherwise indicated, these
securities are not considered to be illiquid. At the end of the period, the
value of these securities totaled $14,326,821 or 6.97% of net assets.
/3 /Non-income producing security.
/4 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of these
securities totaled $3,609,317 or 1.76% of net assets.
/5 /Security purchased on a when-issued basis. See Notes to Financial
Statements.
/6 /Security was purchased in a "to-be-announced" ("TBA") transaction. See Notes
to Financial Statements.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 3,435,886
Unrealized Depreciation (1,553,084)
------------
Net Unrealized Appreciation (Depreciation) 1,882,802
Cost for federal income tax purposes $229,019,069
Notional Unrealized
Description Amount Gain (Loss)
- ----------------------------------------------------------------------------
SWAP AGREEMENTS
TOTAL RETURN SWAPS
Receive a monthly return equal to the Lehman $7,500,000 $95,351
ERISA Eligible CMBS Index and pay monthly a
floating rate based on 1-month LIBOR less 5 basis
points with Morgan Stanley. Expires May 2005.
Receive a monthly return equal to a 30-year 5.5%
FNMA and pay monthly a floating rate based on 3,000,000 (681)
1-month LIBOR less 15 basis points with Merrill
Lynch. Expires June 2005.
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
$
Mortgage Securities 73,736,949 31.92%
Financial 50,454,191 21.84
Government 37,837,573 16.38
Asset Backed Securities 15,052,527 6.52
Communications 13,526,044 5.86
Utilities 8,361,268 3.62
Consumer, Non-cyclical 7,975,412 3.45
Energy 7,864,097 3.40
Consumer, Cyclical 6,719,808 2.91
Basic Materials 4,200,945 1.82
Industrial 4,115,408 1.78
Technology 647,245 0.28
Diversified 410,404 0.18
Swap Agreements 94,670 0.04
TOTAL $230,996,541 100.00%
---------------- -----------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
80
SCHEDULE OF INVESTMENTS
PRINCIPAL CAPITAL VALUE FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- --------------------------------------------------------------------------------------------------
COMMON STOCKS (98.81%)
ADVERTISING AGENCIES (0.33%)
$
Omnicom Group 13,300 1,102,570
AEROSPACE & DEFENSE (0.94%)
Northrop Grumman 56,770 3,113,267
AEROSPACE & DEFENSE EQUIPMENT (1.72%)
General Dynamics 22,630 2,377,281
Lockheed Martin 54,300 3,309,585
5,686,866
APPAREL MANUFACTURERS (0.73%)
Liz Claiborne 32,100 1,137,303
VF 22,400 1,267,616
2,404,919
APPLICATIONS SOFTWARE (0.30%)
Compuware /1/ 168,000 999,600
ATHLETIC FOOTWEAR (0.38%)
Nike 16,330 1,254,307
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.46%)
Paccar 22,621 1,535,966
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.35%)
Autoliv 26,000 1,150,500
BEVERAGES-NON-ALCOHOLIC (0.62%)
Coca-Cola 47,500 2,063,400
BEVERAGES-WINE & SPIRITS (0.34%)
Brown-Forman 20,120 1,116,660
BUILDING-RESIDENTIAL & COMMERCIAL (1.06%)
DR Horton 40,640 1,239,520
MDC Holdings 14,161 925,846
Pulte Homes 18,580 1,327,541
3,492,907
CABLE TV (0.63%)
Comcast /1/ 64,860 2,082,655
CHEMICALS-DIVERSIFIED (2.12%)
Dow Chemical 87,900 4,037,247
FMC /1/ 20,800 1,019,200
PPG Industries 29,100 1,965,705
7,022,152
CHEMICALS-SPECIALTY (0.70%)
Cabot 38,700 1,182,285
Sigma-Aldrich 19,440 1,135,879
2,318,164
COMMERCIAL BANKS (1.66%)
Associated Banc-Corp 28,100 868,852
Compass Bancshares 29,300 1,260,486
North Fork Bancorp 65,500 1,843,825
UnionBanCal 24,480 1,506,989
5,480,152
COMPUTERS (2.32%)
Apple Computer /1/ 54,400 1,961,664
Hewlett-Packard 237,700 4,865,719
Shares
Held Value
- ---------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMPUTERS (CONTINUED)
$
International Business Machines 11,060 844,763
7,672,146
COMPUTERS-INTEGRATED SYSTEMS (0.50%)
Brocade Communications Systems /1/ 140,800 613,888
NCR /1/ 31,900 1,052,700
1,666,588
COMPUTERS-MEMORY DEVICES (0.68%)
EMC /1/ 109,800 1,440,576
Network Appliance /1/ 30,600 814,878
2,255,454
CONTAINERS-METAL & GLASS (0.41%)
Ball 34,160 1,349,320
CONTAINERS-PAPER & PLASTIC (0.34%)
Sonoco Products 42,000 1,137,780
COSMETICS & TOILETRIES (1.09%)
Colgate-Palmolive 24,900 1,239,771
Gillette 29,700 1,533,708
Procter & Gamble 15,380 832,827
3,606,306
DIRECT MARKETING (0.32%)
Harte-Hanks 37,590 1,071,315
DIVERSIFIED MANUFACTURING OPERATIONS (6.08%)
Eaton 24,500 1,438,150
General Electric 477,988 17,303,166
ITT Industries 15,200 1,374,992
20,116,308
ELECTRIC PRODUCTS-MISCELLANEOUS (0.26%)
Ametek 22,600 855,862
ELECTRIC-INTEGRATED (4.76%)
Constellation Energy Group 38,630 2,030,393
Duke Energy 116,900 3,412,311
Edison International 70,700 2,566,410
Exelon 58,660 2,903,670
PPL 26,700 1,448,742
TXU 39,340 3,374,978
15,736,504
ENGINES-INTERNAL COMBUSTION (0.41%)
Cummins Engine 20,000 1,360,000
ENTERPRISE SOFTWARE & SERVICE (0.37%)
Oracle /1/ 104,700 1,210,332
FINANCE-CREDIT CARD (0.89%)
Capital One Financial 20,280 1,437,649
MBNA 76,790 1,516,603
2,954,252
FINANCE-INVESTMENT BANKER & BROKER (8.52%)
Bear Stearns 22,700 2,148,782
Citigroup /2/ 257,680 12,100,653
E*Trade Financial /1/ 86,800 964,348
Goldman Sachs Group 35,920 3,835,897
Lehman Brothers Holdings 38,217 3,505,263
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-INVESTMENT BANKER & BROKER (CONTINUED)
$
Merrill Lynch 82,120 4,428,731
Morgan Stanley 23,190 1,220,258
28,203,932
FINANCE-MORTGAGE LOAN/BANKER (0.96%)
Countrywide Financial 87,604 3,170,389
FINANCIAL GUARANTEE INSURANCE (0.46%)
MGIC Investment 26,000 1,534,000
FOOD-FLOUR & GRAIN (0.49%)
Archer Daniels Midland 89,240 1,605,428
FOOD-MEAT PRODUCTS (0.68%)
Hormel Foods 37,000 1,152,180
Smithfield Foods /1/ 36,200 1,095,412
2,247,592
FOOD-MISCELLANEOUS/DIVERSIFIED (0.34%)
Kellogg 25,100 1,128,245
GAS-DISTRIBUTION (1.07%)
Energen 17,270 1,069,877
ONEOK 38,600 1,113,996
UGI 26,900 1,351,187
3,535,060
HOTELS & MOTELS (0.51%)
Starwood Hotels & Resorts Worldwide 31,100 1,689,974
HUMAN RESOURCES (0.24%)
Robert Half International 32,312 801,984
INSTRUMENTS-CONTROLS (0.24%)
Thermo Electron /1/ 31,900 796,862
INSTRUMENTS-SCIENTIFIC (0.55%)
Applied Biosystems Group 51,430 1,090,316
PerkinElmer 39,600 732,600
1,822,916
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.30%)
Nuveen Investments 29,300 995,907
LIFE & HEALTH INSURANCE (1.22%)
Genworth Financial 43,200 1,207,440
Lincoln National 39,600 1,780,812
Stancorp Financial Group 13,800 1,055,976
4,044,228
MACHINERY TOOLS & RELATED PRODUCTS (0.29%)
Lincoln Electric Holdings 31,560 964,158
MACHINERY-FARM (0.60%)
Deere 31,610 1,976,889
MEDICAL PRODUCTS (0.52%)
Zimmer Holdings /1/ 21,190 1,725,290
MEDICAL-HMO (1.31%)
Aetna 34,020 2,496,047
WellPoint /1/ 14,300 1,826,825
4,322,872
Shares
Held Value
- ---------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
METAL PROCESSORS & FABRICATION (0.25%)
$
Worthington Industries 51,500 837,390
METAL-COPPER (0.48%)
Phelps Dodge 18,600 1,596,810
MISCELLANEOUS INVESTING (3.10%)
Archstone-Smith Trust 40,310 1,449,950
CBL & Associates Properties 14,600 1,129,602
Kimco Realty 29,400 1,628,466
Pan Pacific Retail Properties 19,300 1,166,106
Prologis Trust 36,800 1,456,912
Simon Property Group 35,600 2,352,092
Ventas 39,210 1,057,886
10,241,014
MONEY CENTER BANKS (4.94%)
Bank of America 244,722 11,022,279
JP Morgan Chase 149,620 5,310,014
16,332,293
MULTI-LINE INSURANCE (2.92%)
American International Group 42,400 2,156,040
Cigna 22,900 2,106,342
Loews 27,000 1,913,760
Prudential Financial 60,800 3,474,720
9,650,862
MULTIMEDIA (2.23%)
Gemstar-TV Guide International /1/ 249,900 962,115
McGraw-Hill 15,320 1,334,065
Time Warner /1/ 99,970 1,680,496
Walt Disney 128,300 3,387,120
7,363,796
OIL COMPANY-EXPLORATION & PRODUCTION (3.30%)
Anadarko Petroleum 33,500 2,446,840
Apache 52,130 2,934,397
Devon Energy 70,940 3,204,360
EOG Resources 49,200 2,339,460
10,925,057
OIL COMPANY-INTEGRATED (10.50%)
ChevronTexaco 82,140 4,271,280
ConocoPhillips 53,320 5,590,602
Exxon Mobil /2/ 372,703 21,255,252
Occidental Petroleum 52,349 3,612,081
34,729,215
OIL REFINING & MARKETING (0.36%)
Premcor 18,100 1,197,315
OPTICAL SUPPLIES (0.35%)
Bausch & Lomb 15,410 1,155,750
PAPER & RELATED PRODUCTS (0.65%)
Georgia-Pacific 62,970 2,157,982
PIPELINES (0.91%)
Equitable Resources 18,700 1,077,868
Questar 33,075 1,931,580
3,009,448
Shares
Held Value
- ----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
POULTRY (0.37%)
$
Pilgrims Pride 33,820 1,220,564
PROPERTY & CASUALTY INSURANCE (0.62%)
State Auto Financial 32,200 877,128
W.R. Berkley 36,600 1,189,500
2,066,628
PUBLISHING-NEWSPAPERS (0.30%)
Washington Post 1,130 976,603
RECYCLING (0.21%)
Metal Management 35,026 706,474
REGIONAL BANKS (5.56%)
Comerica 34,360 1,967,454
KeyCorp 72,840 2,415,374
SunTrust Banks 45,400 3,306,482
U.S. Bancorp 34,000 948,600
Wachovia 119,320 6,106,797
Wells Fargo 60,940 3,652,744
18,397,451
RETAIL-APPAREL & SHOE (0.67%)
American Eagle Outfitters 36,400 954,408
Nordstrom 24,800 1,260,584
2,214,992
RETAIL-MAJOR DEPARTMENT STORE (0.63%)
J.C. Penney 44,100 2,090,781
RETAIL-REGIONAL DEPARTMENT STORE (0.74%)
Dillard's 47,900 1,114,633
Neiman Marcus Group 13,580 1,335,186
2,449,819
RETAIL-RESTAURANTS (1.15%)
McDonald's 130,160 3,814,990
STEEL PRODUCERS (0.32%)
United States Steel 24,900 1,064,724
TELEPHONE-INTEGRATED (4.87%)
ALLTEL 48,000 2,734,080
AT&T 115,100 2,201,863
BellSouth 123,800 3,279,462
SBC Communications 173,030 4,118,114
Verizon Communications 105,092 3,762,294
16,095,813
TOBACCO (3.06%)
Altria Group 138,250 8,984,867
Loews - Carolina Group 35,700 1,124,550
10,109,417
TRANSPORT-AIR FREIGHT (0.38%)
CNF 29,380 1,255,995
TRANSPORT-RAIL (0.87%)
Burlington Northern Santa Fe 59,600 2,875,700
TOTAL COMMON STOCKS 326,918,861
Principal
Amount Value
- ------------------------------------------------------------------------------------------
COMMERCIAL PAPER (0.98%)
MONEY CENTER BANKS (0.98%)
Investment in Joint Trading Account; Citicorp
$ $
2.95%; 05/02/05 3,252,169 3,252,169
TOTAL COMMERCIAL PAPER 3,252,169
------------
TOTAL PORTFOLIO INVESTMENTS (99.79%) 330,171,030
CASH, RECEIVABLES AND OTHER ASSETS, NET OF LIABILITIES (0.21%) 697,845
TOTAL NET ASSETS (100.00%) $330,868,875
--------------
SCHEDULE OF INVESTMENTS
PRINCIPAL CAPITAL VALUE FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Contract Opening Current Unrealized
Type Commitment Market Value Market Value Gain(Loss)
- ---------------------------------------------------------------------
FUTURES CONTRACTS
11 Russell 1000 Buy $3,528,750 $3,433,650 $(95,100)
June 2005
Futures
/1 /Non-income producing security.
/2 /Security or a portion of the security was pledged to cover margin
requirements for futures contracts. At the end of the period, the value of
these securities totaled $23,563,955 or 7.12% of net assets.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 33,310,876
Unrealized Depreciation (10,036,600)
------------
Net Unrealized Appreciation (Depreciation) 23,274,276
Cost for federal income tax purposes $306,896,754
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- ------------------------------------------------------------------------------
Financial $106,323,277 31.87%
Energy 49,861,036 14.95
Industrial 44,855,788 13.45
Consumer, Non-cyclical 31,103,508 9.32
Communications 28,692,751 8.60
Consumer, Cyclical 22,099,154 6.62
Utilities 19,271,564 5.78
Basic Materials 14,159,832 4.24
Technology 13,804,120 4.14
Futures Contracts 3,433,650 1.03
TOTAL $333,604,680 100.00%
---------------- -----------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL CASH MANAGEMENT FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Principal
Amount Value
- ---------------------------------------------------------------------------------------------
COMMERCIAL PAPER (97.98%)
ASSET BACKED SECURITIES (8.18%)
CAFCO
$ $
2.90%; 05/26/05 2,590,000 2,584,575
2.95%; 06/06/05 2,100,000 2,093,633
2.98%; 06/16/05 2,400,000 2,390,663
3.09%; 07/19/05 2,600,000 2,582,147
FCAR Owner Trust I
2.83%; 05/11/05 1,790,000 1,788,452
2.94%; 06/07/05 2,500,000 2,492,242
2.94%; 06/10/05 2,000,000 1,993,303
2.97%; 06/21/05 2,000,000 1,991,420
Windmill Funding
2.73%; 05/11/05 2,040,000 2,038,298
2.83%; 05/25/05 2,000,000 1,996,069
2.91%; 05/27/05 2,000,000 1,995,635
2.94%; 06/15/05 2,600,000 2,590,233
2.98%; 06/29/05 840,000 835,828
27,372,498
BEVERAGES-NON-ALCOHOLIC (1.96%)
Coca-Cola
2.74%; 05/18/05 2,195,000 2,191,993
2.94%; 06/27/05 2,000,000 1,990,526
2.97%; 07/01/05 2,400,000 2,387,724
6,570,243
CHEMICALS-DIVERSIFIED (1.44%)
E. I. Du Pont de Nemours
2.84%; 05/25/05 2,990,000 2,984,103
2.92%; 06/13/05 1,840,000 1,833,433
4,817,536
COATINGS & PAINT (1.26%)
Sherwin-Williams
2.77%; 05/02/05 2,125,000 2,124,673
2.77%; 05/03/05 2,110,000 2,109,513
4,234,186
COMMERCIAL BANKS (9.18%)
Calyon North America
2.90%; 06/03/05 2,600,000 2,592,891
3.04%; 07/15/05 2,000,000 1,987,165
Deutsche Bank Financial
3.01%; 06/27/05 2,500,000 2,500,000
Nordea North America
2.76%; 05/20/05 2,000,000 1,996,933
2.78%; 05/09/05 2,000,000 1,998,610
2.83%; 05/20/05 2,400,000 2,396,234
Skandinaviska Enskilda Banken
2.74%; 05/03/05 2,000,000 1,999,543
2.74%; 05/10/05 2,700,000 2,697,945
2.75%; 05/06/05 2,000,000 1,999,083
2.76%; 05/17/05 2,130,000 2,127,224
2.78%; 05/17/05 1,700,000 1,697,768
2.79%; 05/27/05 1,400,000 1,397,039
Svenska Handelsbanken
3.02%; 07/07/05 2,780,000 2,764,142
3.04%; 07/20/05 2,600,000 2,582,216
30,736,793
Principal
Amount Value
- ---------------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONTINUED)
CONSUMER PRODUCTS-MISCELLANEOUS (3.07%)
Fortune Brands
$ $
2.75%; 05/11/05 2,390,000 2,387,992
2.78%; 05/13/05 2,000,000 1,997,992
2.90%; 06/10/05 2,125,000 2,117,981
2.91%; 05/23/05 2,400,000 2,395,538
3.02%; 06/01/05 1,400,000 1,396,242
10,295,745
COSMETICS & TOILETRIES (1.36%)
Procter & Gamble
2.84%; 06/01/05 2,000,000 1,994,951
2.89%; 05/31/05 2,000,000 1,995,023
2.91%; 06/06/05 560,000 558,325
4,548,299
DISTRIBUTION-WHOLESALE (0.60%)
Louis Dreyfus
2.95%; 05/23/05 2,000,000 1,996,230
DIVERSIFIED FINANCIAL SERVICES (2.87%)
Amstel Funding
2.79%; 05/23/05 2,500,000 2,495,544
3.10%; 07/25/05 2,000,000 1,985,189
General Electric Capital
2.69%; 05/02/05 2,380,000 2,379,644
2.90%; 06/09/05 2,750,000 2,741,139
9,601,516
DIVERSIFIED MANUFACTURING OPERATIONS (1.52%)
Dover
2.87%; 05/20/05 3,100,000 3,095,057
Illinois Tool Works
2.80%; 05/24/05 2,000,000 1,996,267
5,091,324
FINANCE-AUTO LOANS (2.11%)
Paccar Financial
2.72%; 05/12/05 2,700,000 2,697,552
Toyota Motor Credit
2.84%; 05/27/05 2,100,000 2,095,527
3.00%; 07/08/05 2,300,000 2,286,775
7,079,854
FINANCE-COMMERCIAL (4.16%)
CIT Group
2.98%; 06/23/05 1,500,000 1,493,295
3.00%; 06/24/05 2,300,000 2,289,458
3.00%; 06/30/05 2,500,000 2,487,292
3.04%; 07/13/05 3,380,000 3,358,879
Verizon Network Funding
2.95%; 06/06/05 2,330,000 2,322,936
2.99%; 06/21/05 2,000,000 1,991,362
13,943,222
FINANCE-CONSUMER LOANS (3.38%)
American General Finance
2.91%; 06/08/05 2,800,000 2,791,173
3.03%; 06/13/05 2,000,000 1,992,594
3.03%; 06/22/05 2,000,000 1,991,078
3.04%; 07/06/05 2,350,000 2,336,704
Principal
Amount Value
- ---------------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONTINUED)
FINANCE-CONSUMER LOANS (CONTINUED)
HSBC Finance
$ $
2.95%; 06/22/05 2,200,000 2,190,316
11,301,865
FINANCE-CREDIT CARD (1.20%)
American Express Credit
2.74%; 05/09/05 1,735,000 1,733,812
2.80%; 05/12/05 2,300,000 2,297,853
4,031,665
FINANCE-INVESTMENT BANKER & BROKER (11.01%)
Bear Stearns
2.74%; 05/17/05 2,500,000 2,496,765
2.87%; 06/06/05 2,000,000 1,994,101
2.97%; 06/20/05 2,200,000 2,190,743
3.04%; 07/11/05 2,600,000 2,584,192
Citigroup Global Markets Holdings
2.85%; 06/08/05 2,500,000 2,492,281
3.00%; 06/07/05 2,000,000 1,993,667
3.03%; 07/14/05 2,400,000 2,384,850
Goldman Sachs Group
2.78%; 05/13/05 2,200,000 2,197,791
2.80%; 05/04/05 2,600,000 2,599,191
ING U.S. Funding
2.71%; 05/19/05 2,700,000 2,696,138
2.94%; 06/07/05 1,800,000 1,794,424
3.03%; 07/08/05 2,300,000 2,286,643
Morgan Stanley
2.93%; 06/03/05 2,500,000 2,493,082
3.00%; 07/07/05 2,000,000 1,988,667
3.02%; 07/11/05 2,200,000 2,186,712
3.08%; 07/18/05 2,500,000 2,483,103
36,862,350
FINANCE-LEASING COMPANY (2.43%)
International Lease Finance
2.69%; 05/05/05 2,400,000 2,399,103
2.75%; 05/12/05 2,080,000 2,078,093
2.86%; 05/13/05 2,150,000 2,147,780
River Fuel Funding
3.02%; 06/28/05 1,535,000 1,527,403
8,152,379
FINANCE-MORTGAGE LOAN/BANKER (2.51%)
Federal Home Loan Mortgage
2.97%; 06/28/05 2,100,000 2,089,778
3.01%; 08/08/05 2,000,000 1,983,278
Federal National Mortgage Association
2.76%; 05/18/05 2,700,000 2,696,274
2.92%; 06/13/05 1,630,000 1,624,183
8,393,513
FINANCE-OTHER SERVICES (6.11%)
CRC Funding
2.94%; 05/27/05 1,850,000 1,845,907
2.96%; 06/01/05 2,400,000 2,393,685
3.02%; 07/13/05 2,200,000 2,186,343
HSBC Funding
2.95%; 06/16/05 2,500,000 2,490,372
3.00%; 06/21/05 2,000,000 1,991,333
Principal
Amount Value
- ---------------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONTINUED)
FINANCE-OTHER SERVICES (CONTINUED)
Private Export Funding
$ $
2.57%; 05/26/05 2,600,000 2,595,174
2.75%; 05/25/05 2,200,000 2,195,799
3.02%; 07/27/05 2,600,000 2,580,806
3.06%; 08/10/05 2,200,000 2,180,926
20,460,345
MEDICAL-DRUGS (1.23%)
Pfizer
2.66%; 05/06/05 1,635,000 1,634,275
2.73%; 05/16/05 2,500,000 2,496,967
4,131,242
MONEY CENTER BANKS (8.94%)
Bank of America
2.71%; 05/13/05 2,000,000 1,998,043
2.74%; 05/05/05 2,200,000 2,199,163
2.75%; 05/06/05 2,700,000 2,698,762
BNP Paribas Finance
2.76%; 05/10/05 2,500,000 2,498,078
2.77%; 06/02/05 2,500,000 2,493,652
2.91%; 06/09/05 2,700,000 2,691,180
2.96%; 06/23/05 2,445,000 2,434,144
Citicorp
2.95%; 06/02/05 2,200,000 2,194,051
2.95%; 06/24/05 1,800,000 1,791,888
2.98%; 06/17/05 2,000,000 1,992,053
HBOS Treasury Services
2.78%; 05/18/05 2,300,000 2,296,803
2.80%; 05/24/05 1,880,000 1,876,491
2.90%; 05/31/05 2,765,000 2,758,095
29,922,403
OIL COMPANY-INTEGRATED (1.22%)
Shell Finance
2.93%; 06/14/05 2,200,000 2,191,942
3.00%; 07/06/05 1,900,000 1,889,392
4,081,334
SPECIAL PURPOSE ENTITY (15.43%)
Barclays U.S. Funding
2.70%; 05/10/05 2,300,000 2,298,275
2.90%; 06/03/05 1,450,000 1,446,029
2.95%; 06/14/05 2,000,000 1,992,625
Compass Securitization
2.82%; 05/25/05 520,000 518,920
Galaxy Funding
2.72%; 05/23/05 2,000,000 1,996,524
Grampian Funding
2.68%; 05/04/05 800,000 799,762
2.75%; 05/31/05 2,700,000 2,693,606
3.11%; 07/29/05 2,065,000 2,048,970
Ranger Funding
2.86%; 05/09/05 1,580,000 1,578,870
2.92%; 05/03/05 2,490,000 2,489,394
3.01%; 07/05/05 1,860,000 1,849,736
3.04%; 07/12/05 2,000,000 1,987,671
Principal
Amount Value
- ---------------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONTINUED)
SPECIAL PURPOSE ENTITY (CONTINUED)
Scaldis Capital
2.97%; 06/20/05 $2,320,000 $ 2,310,239
2.97%; 06/22/05 2,800,000 2,787,757
3.00%; 07/01/05 1,800,000 1,790,700
3.03%; 07/06/05 1,680,000 1,670,526
Southern Company Funding
2.96%; 06/24/05 2,500,000 2,488,695
Surrey Funding
2.73%; 05/02/05 2,500,000 2,499,621
2.85%; 05/16/05 2,735,000 2,731,536
2.91%; 05/24/05 1,215,000 1,212,643
2.92%; 05/24/05 1,915,000 1,911,272
2.92%; 05/26/05 1,900,000 1,895,993
White Pine Finance
2.84%; 05/05/05 2,100,000 2,099,172
3.02%; 06/27/05 2,500,000 2,487,836
Yorktown Capital
2.96%; 06/17/05 2,100,000 2,091,706
2.97%; 06/13/05 2,000,000 1,992,740
51,670,818
SUPRANATIONAL BANK (2.94%)
Corp Andina de Fomento
2.77%; 05/09/05 2,070,000 2,068,566
2.90%; 05/19/05 4,400,000 4,393,266
2.92%; 05/11/05 730,000 729,349
2.97%; 05/11/05 2,640,000 2,637,604
9,828,785
TELECOMMUNICATION SERVICES (1.19%)
Verizon Global Funding
3.12%; 06/15/05 4,000,000 4,000,000
TELEPHONE COMMUNICATION (2.09%)
Telstra
2.65%; 05/04/05 2,000,000 1,999,411
2.99%; 06/30/05 2,460,000 2,447,579
3.03%; 07/01/05 2,550,000 2,536,693
6,983,683
TOOLS-HAND HELD (0.59%)
Stanley Works
2.95%; 06/17/05 2,000,000 1,992,133
TOTAL COMMERCIAL PAPER 328,099,961
Principal
Amount Value
- ---------------------------------------------------------------------------------------------
BONDS (2.48%)
FINANCE-INVESTMENT BANKER & BROKER (0.31%)
Lehman Brothers Holdings
6.63%; 02/05/06 1,000,000 1,021,244
FINANCE-MORTGAGE LOAN/BANKER (0.39%)
Federal Home Loan Bank
1.66%; 05/16/05 1,300,000 1,300,000
Principal
Amount Value
- ---------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FOOD-MISCELLANEOUS/DIVERSIFIED (0.36%)
Unilever Capital
$ $
6.88%; 11/01/05 1,200,000 1,221,487
MONEY CENTER BANKS (0.57%)
JP Morgan Chase
6.50%; 08/01/05 1,900,000 1,915,126
REGIONAL BANKS (0.85%)
Bank One
7.00%; 07/15/05 2,815,000 2,839,030
TOTAL BONDS 8,296,887
------------
TOTAL PORTFOLIO INVESTMENTS (100.46%) 336,396,848
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER ASSETS
(-0.46%) (1,528,762)
TOTAL NET ASSETS (100.00%) $334,868,086
---------------
SCHEDULE OF INVESTMENTS
PRINCIPAL CASH MANAGEMENT FUND, INC.
APRIL 30, 2005 (UNAUDITED)
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
Financial $222,735,616 66.21%
Asset Backed Securities 27,372,498 8.14
Consumer, Non-cyclical 26,767,017 7.96
Government 19,522,298 5.80
Communications 15,297,981 4.55
Basic Materials 9,051,722 2.69
Industrial 7,083,457 2.11
Energy 4,081,334 1.21
Utilities 2,488,694 0.74
Consumer, Cyclical 1,996,231 0.59
TOTAL $336,396,848 100.00%
---------------- -----------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL EQUITY INCOME FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ---------------------------------------------------------------------------------------
COMMON STOCKS (79.82%)
AEROSPACE & DEFENSE (1.13%)
$
Northrop Grumman 19,300 1,058,412
AEROSPACE & DEFENSE EQUIPMENT (0.53%)
United Technologies 4,900 498,428
APPLICATIONS SOFTWARE (0.88%)
Microsoft 32,700 827,310
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.96%)
Autoliv 20,300 898,275
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.31%)
CSR /1/ 77,300 144,509
Fletcher Building /1/ 31,900 145,327
289,836
BUILDING & CONSTRUCTION-MISCELLANEOUS (0.15%)
Heijmans /1/ 3,500 137,647
CASINO HOTELS (0.43%)
Harrah's Entertainment 6,200 406,844
CELLULAR TELECOMMUNICATIONS (0.76%)
Telecom Italia Mobile /1/ 122,200 714,808
CHEMICALS-DIVERSIFIED (1.04%)
Dow Chemical 8,500 390,405
PPG Industries 8,648 584,172
974,577
COMMERCIAL BANKS (2.43%)
Associated Banc-Corp 20,000 618,400
Australia & New Zealand Banking
Group /1/ 14,700 248,145
DnB /1/ 16,300 155,851
Nordea Bank/1/ 55,510 529,018
North Fork Bancorp 10,600 298,390
Societe Generale /1/ 2,480 248,033
Suncorp-Metway /1/ 11,500 177,506
2,275,343
DIVERSIFIED FINANCIAL SERVICES (0.55%)
RMB Holdings /1/ 152,300 517,953
DIVERSIFIED MANUFACTURING OPERATIONS (3.17%)
Eaton 8,620 505,994
General Electric 46,000 1,665,200
Honeywell International 17,700 632,952
Textron 2,300 173,305
2,977,451
ELECTRIC-INTEGRATED (6.97%)
Constellation Energy Group 25,000 1,314,000
Duke Energy 25,517 744,841
E.ON /1/ 3,650 310,591
Edison International 30,500 1,107,150
Enel /1/ 22,800 216,977
Exelon 25,100 1,242,450
Fortum /1/ 10,600 161,299
MDU Resources Group 24,500 662,235
PPL 10,700 580,582
Scottish Power /1/ 24,300 196,653
6,536,778
Shares
Held Value
- ---------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-CREDIT CARD (0.41%)
$
MBNA 19,500 385,125
FINANCE-INVESTMENT BANKER & BROKER (2.34%)
Citigroup 46,786 2,197,070
FINANCE-MORTGAGE LOAN/BANKER (2.19%)
American Home Mortgage Investment 40,800 1,334,160
Charter Mac 19,100 399,190
Countrywide Financial 8,800 318,472
2,051,822
GAS-DISTRIBUTION (0.95%)
Sempra Energy 5,897 238,121
UGI 13,000 652,990
891,111
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.67%)
Nuveen Investments 18,600 632,214
LIFE & HEALTH INSURANCE (0.77%)
Lincoln National 16,000 719,520
MEDICAL PRODUCTS (0.50%)
Johnson & Johnson 6,900 473,547
MEDICAL-DRUGS (0.43%)
Orion OYJ /1/ 23,966 407,292
MEDICAL-HOSPITALS (0.67%)
Parkway Holdings /1/ 621,000 631,566
METAL PROCESSORS & FABRICATION (0.82%)
Sims Group /1/ 11,200 131,314
Worthington Industries 39,000 634,140
765,454
METAL-COPPER (0.43%)
Southern Peru Copper 7,900 404,006
MISCELLANEOUS INVESTING (13.94%)
AMB Property 6,200 241,738
Arbor Realty Trust 36,100 884,450
Archstone-Smith Trust 7,300 262,581
Arden Realty 14,100 503,229
Boston Properties 10,400 691,288
CBL & Associates Properties 7,600 588,012
Developers Diversified Realty 12,000 509,280
Eastgroup Properties 6,000 225,000
Education Realty Trust 7,628 122,048
Equity Office Properties Trust 8,400 264,348
Equity Residential Properties
Trust 7,400 254,190
Federal Realty Investment Trust 2,500 133,750
Gramercy Capital 41,500 825,020
Health Care Property Investors 10,800 276,912
Healthcare Realty Trust 7,400 285,714
Hospitality Properties Trust 10,600 442,868
Kimco Realty 9,000 498,510
Lexington Corporate Properties
Trust 26,400 606,672
Mack-Cali Realty 5,100 224,349
Mid-America Apartment Communities 17,300 661,379
Mills 4,500 257,130
Newcastle Investment 32,300 952,527
Shares
Held Value
- ---------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MISCELLANEOUS INVESTING (CONTINUED)
$
Simon Property Group 11,600 766,412
SL Green Realty 5,000 305,000
Sovran Self Storage 6,300 269,325
Tanger Factory Outlet Centers 30,600 708,696
Thornburg Mortgage 26,600 796,936
Vornado Realty Trust 4,700 359,315
Weingarten Realty Investors 4,600 165,646
13,082,325
MONEY CENTER BANKS (2.81%)
Bank of America 35,700 1,607,928
HBOS /1/ 17,200 255,358
JP Morgan Chase 13,560 481,244
Lloyds TSB Group /1/ 33,800 291,051
2,635,581
MULTI-LINE INSURANCE (0.77%)
Cincinnati Financial 14,070 566,177
Pohjola Group /1/ 12,000 154,650
720,827
NON-HOTEL GAMBLING (0.70%)
Greek Organisation of Football
Prognostics /1/ 25,100 660,033
OIL COMPANY-INTEGRATED (6.94%)
Amerada Hess 2,100 196,665
ChevronTexaco 17,400 904,800
ConocoPhillips 6,300 660,555
ENI /1/ 36,500 920,773
Exxon Mobil 34,740 1,981,222
Occidental Petroleum 10,400 717,600
Royal Dutch Petroleum /1/ 11,400 667,417
Shell Transport & Trading /1/ 51,520 463,376
6,512,408
OIL REFINING & MARKETING (0.69%)
Sunoco 6,550 650,153
PAPER & RELATED PRODUCTS (0.43%)
MeadWestvaco 13,700 403,465
PIPELINES (0.41%)
Equitable Resources 6,600 380,424
PROPERTY & CASUALTY INSURANCE (1.47%)
Admiral Group /1/ /2/ 54,507 371,978
Chubb 10,400 850,512
Promina Group /1/ 38,400 154,038
1,376,528
PROPERTY TRUST (0.31%)
Investa Property Group /1/ 92,000 148,360
Macquarie Leisure Trust Group /1/ 108,700 143,330
291,690
PUBLICLY TRADED INVESTMENT FUND (3.37%)
iShares Cohen & Steers Realty
Majors Index Fund 23,833 3,166,214
REAL ESTATE MANAGEMENT & SERVICES (1.87%)
Castellum /1/ 23,500 870,742
Corio /1/ 13,600 730,361
Shares
Held Value
- ---------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
REAL ESTATE MANAGEMENT & SERVICES (CONTINUED)
$
Lend Lease /1/ 16,800 156,989
1,758,092
REAL ESTATE OPERATOR & DEVELOPER (0.57%)
Land Securities Group /1/ 21,140 537,536
REGIONAL BANKS (3.44%)
Comerica 9,000 515,340
KeyCorp 26,000 862,160
National City 11,800 400,728
Wachovia 16,642 851,737
Wells Fargo 9,900 593,406
3,223,371
RETAIL-APPAREL & SHOE (0.14%)
Colorado Group /1/ 31,500 127,098
RETAIL-DISCOUNT (0.24%)
Wal-Mart Stores 4,872 229,666
RETAIL-RESTAURANTS (0.46%)
McDonald's 14,745 432,176
STEEL PRODUCERS (0.15%)
Rautaruukki Oyj /1/ 10,900 139,727
TELEPHONE-INTEGRATED (6.37%)
ALLTEL 4,900 279,104
AT&T 45,000 860,850
BellSouth 17,673 468,158
Citizens Communications 76,900 980,475
SBC Communications 54,700 1,301,860
Sprint 26,290 585,215
TDC /1/ 14,300 612,633
Verizon Communications 24,814 888,341
5,976,636
TOBACCO (3.31%)
Altria Group 22,383 1,454,671
British American Tobacco /1/ 13,200 247,771
Imperial Tobacco Group /1/ 16,800 481,981
Reynolds American 11,800 920,046
3,104,469
TRANSPORT-MARINE (1.52%)
General Maritime /2/ 9,500 416,575
Orient Overseas International /1/ 154,000 744,883
Ship Finance International 6,235 115,908
SMIT Internationale /1/ 3,400 143,825
1,421,191
TRANSPORT-RAIL (0.26%)
Burlington Northern Santa Fe 5,000 241,250
WATER (0.16%)
Pennon Group /1/ 7,800 146,488
TOTAL COMMON STOCKS 74,889,737
Shares
Held Value
- ---------------------------------------------------------------------------------------
PREFERRED STOCKS (13.02%)
CELLULAR TELECOMMUNICATIONS (1.38%)
$
U.S. Cellular 48,000 1,293,600
COMMERCIAL BANKS (2.08%)
CoBank 35,300 1,952,725
ELECTRIC-INTEGRATED (1.64%)
Consolidated Edison 7,556 197,061
DTE Energy Trust I 9,140 236,726
Energy East Capital Trust I 2,185 56,679
Entergy Louisiana 39,580 1,046,495
1,536,961
FINANCE-INVESTMENT BANKER & BROKER (0.06%)
St. Paul Capital Trust I 2,300 58,995
FINANCE-OTHER SERVICES (0.38%)
National Rural Utilities
Cooperative Finance 15,000 356,250
FOOD-DAIRY PRODUCTS (0.40%)
Dairy Farmers of America 3,500 377,344
FOOD-RETAIL (0.31%)
Albertson's 13,400 287,564
GAS-DISTRIBUTION (0.70%)
AGL Capital Trust II 25,385 653,156
MISCELLANEOUS INVESTING (3.25%)
AMB Property 2,800 71,036
Duke Realty 41,547 1,037,013
Federal Realty Investment Trust 15,000 392,700
HRPT Properties Trust 12,600 334,656
Public Storage 14,500 355,975
Realty Income 20,000 517,200
Regency Centers 13,400 342,370
3,050,950
MONEY CENTER BANKS (0.20%)
ABN AMRO Capital Funding Trust V 2,300 55,775
JP Morgan Chase Capital X 5,000 129,950
185,725
MULTI-LINE INSURANCE (0.56%)
XL Capital 19,000 521,550
PIPELINES (0.91%)
TransCanada PipeLines 33,457 857,837
SPECIAL PURPOSE ENTITY (0.68%)
Corporate-Backed Trust
Certificates for DaimlerChrysler 10,500 251,685
Preferred Plus Trust 15,600 383,604
635,289
TELEPHONE-INTEGRATED (0.47%)
SBC Communications 3,500 89,915
Telephone & Data Systems 13,700 353,460
443,375
TOTAL PREFERRED STOCKS 12,211,321
Principal
Amount Value
- ---------------------------------------------------------------------------------------
BONDS (5.77%)
ELECTRIC-INTEGRATED (0.21%)
Georgia Power Capital Trust VI
$ $
4.88%; 11/01/42 200,000 201,266
MULTI-LINE INSURANCE (0.36%)
Allstate Financing II
7.83%; 12/01/45 312,000 336,893
OIL COMPANY-INTEGRATED (1.72%)
Phillips 66 Capital Trust II
8.00%; 01/15/37 1,475,000 1,617,471
PIPELINES (3.48%)
KN Capital Trust III
7.63%; 04/15/28 2,900,000 3,261,944
TOTAL BONDS 5,417,574
Principal
Amount Value
---------------------------------------------------------------------------------------
COMMERCIAL PAPER (0.53%)
FINANCE-MORTGAGE LOAN/BANKER (0.53%)
Investment in Joint Trading
Account;
Federal National Mortgage
Association
2.60%; 05/02/05 $ 501,164 $ 501,085
TOTAL COMMERCIAL PAPER 501,085
-----------
TOTAL PORTFOLIO INVESTMENTS (99.14%) 93,019,717
CASH, RECEIVABLES AND
OTHER ASSETS, NET OF
LIABILITIES (0.86%) 803,703
TOTAL NET ASSETS (100.00%) $93,823,420
-------------
SCHEDULE OF INVESTMENTS
PRINCIPAL EQUITY INCOME FUND, INC.
APRIL 30, 2005 (UNAUDITED)
/1 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of these
securities totaled $14,244,887 or 15.18% of net assets.
/2 /Non-income producing security.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 7,192,055
Unrealized Depreciation (2,277,877)
-----------
Net Unrealized Appreciation (Depreciation) 4,914,178
Cost for federal income tax purposes $88,105,539
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
$ %
Financial 39,503,375 42.47
Energy 13,280,235 14.28
Utilities 9,965,760 10.71
Communications 8,428,419 9.06
Industrial 7,389,669 7.94
Consumer,
Non-cyclical 5,281,783 5.68
Funds 3,166,214 3.40
Consumer, Cyclical 2,754,092 2.96
Basic Materials 1,921,775 2.07
Technology 827,310 0.89
Government 501,085 0.54
TOTAL $93,019,717 100.00%
---------------- ------------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL GOVERNMENT SECURITIES INCOME FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Principal
Amount Value
- ----------------------------------------------------------------------------------
BONDS (46.21%)
ASSET BACKED SECURITIES (1.21%)
Chase Funding Mortgage Loan
Asset Backed Certificates
$ $
3.25%; 12/25/33 /1/ 2,486,486 2,488,963
3.31%; 09/25/33 /1/ 1,270,660 1,272,840
3,761,803
FEDERAL & FEDERALLY SPONSORED CREDIT (4.73%)
Federal Farm Credit Bank
2.63%; 09/17/07 3,000,000 2,911,722
3.00%; 04/15/08 3,000,000 2,920,815
3.75%; 01/15/09 6,000,000 5,922,822
4.48%; 08/24/12 3,000,000 3,004,794
14,760,153
FINANCE-MORTGAGE LOAN/BANKER (35.24%)
Federal Home Loan Bank System
1.88%; 06/15/06 4,000,000 3,920,892
2.45%; 03/23/07 6,000,000 5,845,116
2.63%; 05/15/07 7,000,000 6,826,183
3.75%; 08/15/08 6,000,000 5,934,756
5.80%; 09/02/08 6,000,000 6,312,204
Federal Home Loan Mortgage
3.15%; 04/15/30 /1/ 5,500,000 5,499,109
3.25%; 06/15/18 /1/ 5,549,483 5,565,554
3.25%; 11/15/34 /1/ 6,062,174 6,076,105
4.63%; 05/28/13 3,000,000 2,935,605
4.88%; 03/15/07 6,000,000 6,108,816
5.75%; 01/15/12 3,000,000 3,231,399
Federal National Mortgage
Association
2.63%; 11/15/06 4,000,000 3,930,456
3.00%; 04/25/34 /1/ 6,250,000 6,203,250
3.25%; 08/15/08 6,500,000 6,334,302
3.27%; 11/25/22 /1/ 2,469,388 2,472,292
3.27%; 03/25/35 /1/ 5,955,851 5,956,941
4.11%; 02/17/09 /1/ 4,000,000 4,010,760
5.04%; 03/01/35 /1/ 2,950,586 2,979,572
5.38%; 11/15/11 6,000,000 6,326,190
Federal National Mortgage
Association Grantor Trust
3.20%; 05/25/35 /1/ /2/ 2,987,569 2,986,636
Federal National Mortgage
Association Whole Loan
3.17%; 05/25/35 /1/ 2,983,147 2,983,246
Government National Mortgage
Association
1.00%; 06/17/45 /1/ 29,000,000 1,836,773
1.92%; 10/16/12 /1/ 78,000,000 5,743,686
110,019,843
FINANCE-OTHER SERVICES (0.94%)
Private Export Funding
3.38%; 02/15/09 3,000,000 2,925,339
HOME EQUITY-OTHER (2.15%)
First NLC Trust
3.25%; 05/25/35 /1/ /2/ 4,500,000 4,500,000
Principal
Amount Value
- ----------------------------------------------------------------------------------
BONDS (CONTINUED)
HOME EQUITY-OTHER (CONTINUED)
Option One Mortgage Loan Trust
$ $
3.22%; 05/25/35 /1/ /2/ 2,200,000 2,200,000
6,700,000
HOME EQUITY-SEQUENTIAL (1.28%)
Residential Asset Securities
3.29%; 04/25/35 /1/ /2/ 4,000,000 4,000,000
MORTGAGE BACKED SECURITIES (0.66%)
IMPAC Secured Assets Commercial
Mortgage Owner Trust
3.29%; 12/25/31 /1/ 2,075,000 2,073,992
TOTAL BONDS 144,241,130
Principal
Amount Value
- ----------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) CERTIFICATES (23.24%)
4.50%; 06/01/11 2,778,980 2,783,896
4.50%; 04/01/19 3,350,323 3,319,825
4.50%; 11/01/19 9,630,865 9,543,195
4.50%; 05/01/20 /3/ 13,250,000 13,109,219
5.00%; 05/01/11 8,168,060 8,295,654
5.50%; 12/01/33 8,013,186 8,112,156
5.50%; 05/01/35 /3/ 13,800,000 13,950,944
6.00%; 05/01/35 /3/ 13,100,000 13,443,875
TOTAL FHLMC CERTIFICATES 72,558,764
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) CERTIFICATES (23.39%)
4.50%; 11/01/14 5,063,231 5,067,327
4.50%; 05/01/20 /3/ 10,850,000 10,731,323
4.75%; 02/01/35 /1/ 6,996,352 7,026,072
4.77%; 04/01/35 /1/ 7,517,249 7,486,962
5.00%; 07/01/35 /3/ 15,000,000 14,779,680
5.50%; 05/01/35 /3/ 17,000,000 17,159,375
6.00%; 05/01/35 /3/ 10,500,000 10,778,901
TOTAL FNMA CERTIFICATES 73,029,640
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) CERTIFICATES (13.72%)
3.88%; 10/20/30 /1/ 6,383,882 6,414,244
5.00%; 05/20/33 5,936,899 5,925,268
5.00%; 08/15/33 3,712,269 3,711,976
5.00%; 08/15/33 7,021,582 7,021,027
5.50%; 12/15/13 83,660 86,427
5.50%; 01/15/14 289,168 298,781
5.50%; 01/15/14 286,954 296,495
Principal
Amount Value
- ----------------------------------------------------------------------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
(CONTINUED)
$ $
5.50%; 02/15/14 216,700 223,904
5.50%; 03/15/14 365,381 377,528
6.00%; 03/15/17 1,620,049 1,688,238
6.00%; 10/15/23 755,194 784,394
6.00%; 11/15/23 375,504 390,022
6.00%; 11/15/23 181,134 188,137
6.00%; 12/15/23 175,899 182,700
6.00%; 12/15/23 162,229 168,502
6.00%; 12/15/23 15,381 15,976
6.00%; 01/15/24 257,996 267,649
6.00%; 01/20/24 101,013 104,634
6.00%; 02/15/24 122,310 126,886
6.00%; 02/15/24 216,454 224,552
6.00%; 02/15/24 203,675 211,295
6.00%; 03/15/24 69,384 71,980
6.00%; 04/20/24 156,816 162,439
6.00%; 05/20/24 219,924 227,810
6.00%; 05/20/24 39,612 41,032
6.00%; 10/20/24 96,644 100,109
6.00%; 09/20/25 135,800 140,489
6.00%; 11/20/25 88,910 91,980
6.00%; 08/15/32 737,154 761,157
6.00%; 09/15/32 748,942 773,329
6.50%; 07/15/08 44,178 45,605
6.50%; 07/15/08 53,614 55,346
6.50%; 10/15/08 82,084 84,735
6.50%; 03/15/09 76,938 79,423
6.50%; 09/15/23 72,068 75,959
6.50%; 09/15/23 101,068 106,526
6.50%; 09/15/23 97,249 102,501
6.50%; 09/15/23 125,463 132,238
6.50%; 10/15/23 117,818 124,181
6.50%; 10/15/23 87,132 91,838
6.50%; 11/15/23 75,939 80,040
6.50%; 12/15/23 273,789 288,575
6.50%; 12/15/23 295,765 311,738
6.50%; 12/15/23 137,845 145,290
6.50%; 12/15/23 86,472 91,141
6.50%; 01/15/24 149,672 157,499
6.50%; 01/15/24 72,164 75,938
6.50%; 01/15/24 171,853 180,840
6.50%; 01/15/24 83,682 88,058
6.50%; 01/15/24 133,607 140,594
6.50%; 01/15/24 125,206 131,754
6.50%; 01/15/24 77,823 81,892
6.50%; 01/15/24 67,310 70,830
6.50%; 03/15/24 107,276 112,886
6.50%; 04/15/24 151,076 158,976
6.50%; 04/20/24 100,163 105,056
6.50%; 07/15/24 397,319 418,776
6.50%; 10/15/25 154,933 162,939
6.50%; 01/15/26 61,539 64,685
6.50%; 03/15/26 101,162 106,333
6.50%; 07/20/26 53,390 55,935
6.50%; 02/15/28 122,550 128,545
7.00%; 11/15/22 115,118 122,618
7.00%; 11/15/22 72,990 77,746
Principal
Amount Value
- ----------------------------------------------------------------------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
(CONTINUED)
$ $
7.00%; 11/15/22 276,047 294,033
7.00%; 11/15/22 128,117 136,464
7.00%; 12/15/22 99,645 106,138
7.00%; 12/15/22 272,463 290,215
7.00%; 01/15/23 90,511 96,382
7.00%; 01/15/23 100,884 107,429
7.00%; 01/15/23 53,655 57,136
7.00%; 02/15/23 566,583 603,338
7.00%; 03/15/23 105,974 112,849
7.00%; 07/15/23 62,636 66,699
7.00%; 07/15/23 53,756 57,243
7.00%; 07/15/23 156,624 166,784
7.00%; 07/15/23 112,926 120,251
7.00%; 08/15/23 105,486 112,330
7.00%; 08/15/23 25,496 27,150
7.00%; 10/15/23 96,090 102,323
7.00%; 12/15/23 92,765 98,783
7.00%; 12/15/23 108,365 115,395
7.00%; 01/15/26 73,417 78,025
7.00%; 05/15/26 72,357 76,898
7.00%; 01/15/27 84,707 89,939
7.00%; 03/15/27 43,024 45,681
7.00%; 11/15/27 247,870 263,179
7.00%; 12/15/27 205,738 218,445
7.00%; 04/15/28 54,437 57,778
7.00%; 04/15/28 207,710 220,454
7.25%; 09/15/25 180,681 193,655
7.25%; 09/15/25 39,073 41,879
7.25%; 09/15/25 25,715 27,561
7.25%; 10/15/25 95,611 102,476
7.50%; 04/15/17 20,506 22,081
7.50%; 04/15/17 100,250 107,952
7.50%; 04/15/17 94,221 101,460
7.50%; 05/15/17 18,967 20,424
7.50%; 07/15/18 44,470 47,949
7.50%; 12/15/21 39,824 43,021
7.50%; 12/15/21 45,540 49,196
7.50%; 12/15/21 49,732 53,724
7.50%; 02/15/22 78,355 84,715
7.50%; 03/15/22 22,155 23,954
7.50%; 03/15/22 24,768 26,778
7.50%; 03/15/22 38,065 41,154
7.50%; 04/15/22 28,582 30,902
7.50%; 04/15/22 41,388 44,748
7.50%; 04/15/22 44,108 47,688
7.50%; 04/15/22 43,540 47,074
7.50%; 05/15/22 89,874 97,168
7.50%; 07/15/22 141,728 153,231
7.50%; 08/15/22 26,903 29,087
7.50%; 08/15/22 69,163 74,777
7.50%; 08/15/22 40,605 43,900
7.50%; 08/15/22 23,396 25,295
7.50%; 08/15/22 40,172 43,433
7.50%; 08/15/22 38,267 41,373
7.50%; 08/15/22 177,509 191,917
7.50%; 08/15/22 77,626 83,926
7.50%; 11/15/22 85,076 91,981
Principal
Amount Value
- ----------------------------------------------------------------------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
(CONTINUED)
$ $
7.50%; 02/15/23 39,206 42,376
7.50%; 02/15/23 61,329 66,287
7.50%; 05/15/23 69,560 75,183
7.50%; 05/15/23 20,032 21,651
7.50%; 05/15/23 91,935 99,367
7.50%; 06/15/23 37,674 40,720
7.50%; 10/15/23 41,067 44,387
7.50%; 11/15/23 184,230 199,124
7.50%; 01/15/24 56,419 60,874
7.50%; 08/15/24 29,175 31,478
7.50%; 04/15/27 68,834 74,055
7.50%; 05/15/27 133,780 143,927
7.50%; 05/15/27 59,541 64,057
7.50%; 06/15/27 17,011 18,301
7.50%; 06/15/27 79,828 85,883
8.00%; 08/15/16 120,970 130,658
8.00%; 09/15/16 11,171 12,066
8.00%; 12/15/16 35,613 38,465
8.00%; 04/15/17 18,752 20,380
8.00%; 04/15/17 31,359 34,081
8.00%; 04/15/17 39,010 42,396
8.00%; 05/15/17 44,771 48,657
8.00%; 05/15/17 24,940 27,105
8.00%; 06/15/17 30,823 33,498
8.00%; 06/15/17 37,667 40,936
8.00%; 06/15/17 55,663 60,495
8.00%; 07/15/17 30,410 33,050
8.00%; 02/15/22 128,804 139,846
TOTAL GNMA CERTIFICATES 42,821,119
Principal
Amount Value
- ----------------------------------------------------------------------------------
TREASURY BONDS (11.21%)
U.S. Treasury Inflation-Indexed
Obligations
2.38%; 01/15/25 5,086,650 5,555,777
3.88%; 01/15/09 5,846,450 6,461,011
4.25%; 01/15/10 3,419,370 3,911,438
U.S. Treasury Strip
0.00%; 11/15/15 /4/ 18,000,000 11,391,192
0.00%; 05/15/20 /4/ 10,000,000 4,987,840
0.00%; 08/15/25 /4/ 7,000,000 2,695,553
TOTAL TREASURY BONDS 35,002,811
Principal
Amount Value
- ----------------------------------------------------------------------------------
COMMERCIAL PAPER (15.25%)
FINANCE-MORTGAGE LOAN/BANKER (15.25%)
Investment in Joint Trading
Account; Federal National
Mortgage Association
$ $
2.60%; 05/02/05 47,619,776 47,612,237
TOTAL COMMERCIAL PAPER 47,612,237
-------------
TOTAL PORTFOLIO INVESTMENTS (133.02%) 415,265,701
LIABILITIES, NET OF
CASH, RECEIVABLES
AND OTHER ASSETS
(-33.02%) (103,090,892)
TOTAL NET ASSETS (100.00%) $ 312,174,809
----------------
/1 /Variable rate.
/2 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of these
securities totaled $13,686,636 or 4.38% of net assets.
/3 /Security was purchased in a "to-be-announced" ("TBA") transaction. See Notes
to Financial Statements.
/4 /Non-income producing security.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 2,530,696
Unrealized Depreciation (1,034,349)
------------
Net Unrealized Appreciation (Depreciation) 1,496,347
Cost for federal income tax purposes $413,769,354
COUPON DISTRIBUTION
Coupon Range Value Percentage of
Total Value
- ---------------------------------------------------------------------------
Less than 4.00% $ 194,449,643 46.83%
4.00 - 4.99% 79,039,232 19.03
5.00 - 5.99% 99,088,582 23.86
6.00 - 6.99% 35,002,761 8.43
7.00 - 7.99% 7,023,851 1.69
8.00% and over 661,632 0.16
TOTAL $415,265,701 100.00%
------------------------- ---------
94
SCHEDULE OF INVESTMENTS
PRINCIPAL GROWTH FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ----------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (96.17%)
AGRICULTURAL CHEMICALS (2.34%)
$
Potash Corp. of Saskatchewan 80,000 6,731,200
APPLICATIONS SOFTWARE (1.56%)
Microsoft 178,100 4,505,930
ATHLETIC FOOTWEAR (2.17%)
Nike 81,500 6,260,015
BEVERAGES-WINE & SPIRITS (1.73%)
Constellation Brands /1/ 94,500 4,981,095
CASINO HOTELS (2.06%)
Station Casinos 92,100 5,943,213
CHEMICALS-DIVERSIFIED (1.40%)
E. I. Du Pont de Nemours 85,300 4,018,483
COMPUTERS (1.80%)
Apple Computer /1/ 143,500 5,174,610
COMPUTERS-MEMORY DEVICES (1.22%)
Network Appliance /1/ 132,000 3,515,160
CONSUMER PRODUCTS-MISCELLANEOUS (2.17%)
Clorox 98,900 6,260,370
COSMETICS & TOILETRIES (2.25%)
Colgate-Palmolive 85,300 4,247,087
Estee Lauder 58,342 2,240,916
6,488,003
DISPOSABLE MEDICAL PRODUCTS (2.35%)
C.R. Bard 95,200 6,775,384
DIVERSIFIED MANUFACTURING OPERATIONS (1.81%)
Textron 69,100 5,206,685
ELECTRIC-GENERATION (0.97%)
AES /1/ 174,000 2,797,920
ELECTRIC-INTEGRATED (2.74%)
TXU 92,100 7,901,259
ELECTRONIC COMPONENTS-SEMICONDUCTOR (2.62%)
Broadcom /1/ 145,600 4,354,896
Texas Instruments 128,300 3,202,368
7,557,264
ELECTRONIC FORMS (1.62%)
Adobe Systems 78,500 4,668,395
ENTERPRISE SOFTWARE & SERVICE (0.95%)
Oracle /1/ 235,400 2,721,224
FINANCE-COMMERCIAL (2.19%)
CIT Group 156,400 6,299,792
FINANCE-CREDIT CARD (1.94%)
Capital One Financial 78,600 5,571,954
FINANCE-INVESTMENT BANKER & BROKER (4.00%)
Goldman Sachs Group 107,900 11,522,641
FOOD-CONFECTIONERY (2.41%)
Hershey 61,000 3,897,900
Shares
Held Value
---------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FOOD-CONFECTIONERY (CONTINUED)
$
Wm. Wrigley Jr. 44,000 3,041,720
6,939,620
MACHINERY-GENERAL INDUSTRY (1.96%)
Ingersoll-Rand 73,500 5,649,945
MEDICAL PRODUCTS (3.05%)
Johnson & Johnson 128,000 8,784,640
MEDICAL-DRUGS (2.39%)
Schering-Plough 329,500 6,876,665
MULTI-LINE INSURANCE (3.11%)
Cigna 97,500 8,968,050
NETWORKING PRODUCTS (2.34%)
Juniper Networks /1/ 298,200 6,736,338
OIL COMPANY-EXPLORATION & PRODUCTION (4.75%)
Apache 116,200 6,540,898
Devon Energy 157,700 7,123,309
13,664,207
OIL COMPANY-INTEGRATED (3.02%)
ConocoPhillips 83,000 8,702,550
OPTICAL SUPPLIES (1.57%)
Alcon 46,500 4,510,500
PHARMACY SERVICES (2.54%)
Caremark Rx /1/ 182,600 7,313,130
RADIO (1.55%)
XM Satellite Radio Holdings /1/ 160,700 4,457,818
RETAIL-APPAREL & SHOE (2.35%)
Nordstrom 133,000 6,760,390
RETAIL-DRUG STORE (2.60%)
CVS 144,900 7,473,942
RETAIL-OFFICE SUPPLIES (2.85%)
Staples 430,200 8,203,914
RETAIL-RESTAURANTS (3.60%)
McDonald's 353,900 10,372,809
SEMICONDUCTOR COMPONENT-INTEGRATED
CIRCUITS (1.56%)
Marvell Technology Group /1/ 134,300 4,496,364
TELECOMMUNICATION EQUIPMENT (2.51%)
Comverse Technology /1/ 317,300 7,231,267
TELEPHONE-INTEGRATED (1.96%)
Sprint 253,300 5,638,458
TRANSPORT-SERVICES (1.54%)
FedEx 52,100 4,425,895
WEB PORTALS (3.47%)
Google /1/ 32,490 7,147,800
Yahoo /1/ 82,000 2,829,820
9,977,620
Shares
Held Value
----------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
WIRELESS EQUIPMENT (5.15%)
$
Motorola 482,200 7,396,948
Nokia 465,100 7,432,298
14,829,246
TOTAL COMMON STOCKS 276,913,965
Principal
Amount Value
- ---------------------------------------------------------------------------------
COMMERCIAL PAPER (1.96%)
MONEY CENTER BANKS (1.96%)
Investment in Joint Trading Account; Citicorp
$ $
2.95%; 05/02/05 5,637,159 5,637,159
TOTAL COMMERCIAL PAPER 5,637,159
------------
TOTAL PORTFOLIO INVESTMENTS (98.1%) 282,551,124
CASH, RECEIVABLES AND OTHER ASSETS,
NET OF LIABILITIES (1.87%) 5,372,718
TOTAL NET ASSETS (100.00%)$287,923,842
--------------
/1 /Non-income producing security.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 19,518,819
Unrealized Depreciation (18,731,953)
------------
Net Unrealized Appreciation (Depreciation) 786,866
Cost for federal income tax purposes $281,764,258
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- ------------------------------------------------------------------------------
Consumer, Non-cyclical $ 58,929,407 20.86%
Communications 48,870,747 17.30
Consumer, Cyclical 45,014,283 15.93
Financial 37,999,596 13.45
Technology 32,638,947 11.55
Energy 22,366,757 7.91
Industrial 15,282,525 5.41
Basic Materials 10,749,683 3.80
Utilities 10,699,179 3.79
TOTAL $282,551,124 100.00%
---------------- -----------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
95
SCHEDULE OF INVESTMENTS
PRINCIPAL INTERNATIONAL EMERGING MARKETS FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (88.75%)
AGRICULTURAL OPERATIONS (0.52%)
$
IOI Berhad /1/ 115,691 279,000
AIRLINES (0.59%)
Korean Air Lines /1/ 16,980 314,437
APPLICATIONS SOFTWARE (1.19%)
Infosys Technologies /1/ 14,763 639,890
AUTO-CARS & LIGHT TRUCKS (0.84%)
Hyundai Motor /1/ 5,000 272,135
Proton Holdings /1/ 85,889 177,400
449,535
BATTERIES & BATTERY SYSTEMS (0.15%)
Power Logics /1/ 7,040 81,515
BREWERY (0.50%)
Efes Breweries International
/2/ 8,557 269,546
BUILDING & CONSTRUCTION-MISCELLANEOUS (0.53%)
Orascom Construction Industries
/1/ 12,865 284,715
BUILDING PRODUCTS-CEMENT & AGGREGATE (1.68%)
Cemex 36,817 264,947
Gujarat Ambuja Cements /1/ /2/ 42,469 410,782
Siam Cement /1/ 37,380 225,195
900,924
BUILDING-HEAVY CONSTRUCTION (1.10%)
Empresas ICA Sociedad
Controladora /2/ 687,200 254,702
Hyundai Engineering &
Construction /1/ /2/ 15,000 334,338
589,040
BUSINESS TO BUSINESS-E COMMERCE (0.43%)
Submarino /2/ 34,100 233,479
CASINO HOTELS (0.51%)
Genting Berhad /1/ 56,066 271,766
CELLULAR TELECOMMUNICATIONS (5.23%)
China Mobile /1/ 368,259 1,291,407
Digi.Com Berhad /1/ /2/ 120,600 160,583
Far EasTone Telecommunications
/1/ 683,700 835,281
Partner Communications /1/ /2/ 31,677 269,532
Vimpel Communications /2/ 7,684 251,421
2,808,224
CHEMICALS-DIVERSIFIED (0.56%)
Israel Chemicals /1/ 101,571 299,715
CHEMICALS-SPECIALTY (0.47%)
Frutarom /2/ 34,301 254,414
CIRCUIT BOARDS (1.09%)
Unimicron Technology /1/ 743,000 584,448
COAL (0.37%)
Yanzhou Coal Mining /3/ 144,132 196,534
COMMERCIAL BANKS (9.97%)
Banco Latinoamericano de
Exportaciones 14,800 279,572
Bancolombia 22,083 326,166
Bank Leumi Le-Israel /1/ 178,185 506,465
Bank of the Philippine Islands
/1/ 256,184 227,868
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL BANKS (CONTINUED)
$
Bank Rakyat /1/ 968,979 271,557
Credicorp 15,717 272,690
ICICI Bank 12,400 224,192
Korea Exchange Bank /1/ /2/ 52,240 443,023
OTP Bank /1/ 12,823 395,401
Raiffeisen International Bank
Holding /2/ 2,284 117,942
Siam Commercial Bank Public /1/ 192,300 230,032
Standard Bank Group /1/ 91,956 922,704
Taishin Financial Holdings /1/ 571,000 512,625
Turkiye Is Bankasi /1/ 64,604 328,726
UTI Bank /2/ 56,040 296,227
5,355,190
COMPUTERS (1.12%)
High Tech Computer /1/ 86,000 604,375
DISTRIBUTION-WHOLESALE (0.80%)
Esprit Holdings /1/ 57,423 427,755
DIVERSIFIED FINANCIAL SERVICES (1.27%)
Shinhan Financial Group /1/ 26,124 681,788
DIVERSIFIED MINERALS (0.87%)
Antofagasta /1/ 21,856 469,172
DIVERSIFIED OPERATIONS (1.51%)
Alfa 50,538 255,219
Dogan Sirketler Grubu Holdings
/1/ /2/ 59,215 125,928
Imperial Holdings /1/ /2/ 27,954 431,113
812,260
ELECTRIC-GENERATION (0.56%)
National Thermal Power /1/ 159,574 302,577
ELECTRIC-INTEGRATED (1.23%)
Korea Electric Power /1/ 22,750 662,801
ELECTRONIC COMPONENTS-MISCELLANEOUS (7.08%)
Asustek Computer /1/ 191,000 510,969
Hon Hai Precision Industry /1/ 185,000 878,550
Samsung Electronics 5,272 2,411,198
3,800,717
ENGINEERING-RESEARCH & DEVELOPMENT
SERVICES (0.68%)
Samsung Engineering /1/ 40,050 363,623
FINANCE-CONSUMER LOANS (0.49%)
African Bank Investments /1/ 98,544 264,155
FINANCE-INVESTMENT BANKER & BROKER (0.47%)
Samsung Securities /1/ 10,600 253,177
FINANCE-OTHER SERVICES (1.50%)
Bursa Malaysia /2/ 271,288 272,716
Grupo Financiero Banorte 82,516 531,305
804,021
FOOD-DAIRY PRODUCTS (0.54%)
Binggrae /1/ 7,314 288,473
FOOD-MISCELLANEOUS/DIVERSIFIED (0.00%)
Global Bio-Chem Technology
Group - warrants /2/ 44,296 1,960
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
GAS-DISTRIBUTION (0.64%)
$
OAO Gazprom 10,142 342,403
IMPORT & EXPORT (0.63%)
Testrite International /1/ 507,257 340,274
INDEPENDENT POWER PRODUCER (0.74%)
YTL Power International /1/ 766,436 399,336
INTERNET SECURITY (0.99%)
Check Point Software
Technologies /2/ 25,282 529,658
INVESTMENT COMPANIES (0.50%)
SM Investments /2/ 58,693 270,924
LIFE & HEALTH INSURANCE (3.21%)
Cathay Financial Holding /1/ 297,000 538,622
Metropolitan Holdings /1/ 200,095 354,610
Sanlam /1/ 179,860 341,577
Shin Kong Financial Holding /1/ 522,080 488,647
1,723,456
MEDICAL LABORATORY & TESTING SERVICE (0.54%)
Diagnosticos da America /2/ 8,789 289,474
MEDICAL-DRUGS (0.56%)
Dong-A Pharmaceutical /1/ 9,490 301,019
MISCELLANEOUS MANUFACTURERS (0.21%)
Trakya Cam Sanayi /1/ 38,826 113,341
MULTIMEDIA (0.41%)
Dogan Yayin Holding /1/ /2/ 92,440 221,666
NON-FERROUS METALS (0.48%)
Grupo Mexico /2/ 50,219 234,724
International Nickel Indonesia
/1/ 15,604 22,845
257,569
OIL COMPANY-EXPLORATION & PRODUCTION (1.21%)
Oil & Natural Gas /1/ 15,217 283,278
PTT Public /1/ 72,401 367,561
650,839
OIL COMPANY-INTEGRATED (6.60%)
China Petroleum & Chemical /1/
/3/ 1,641,609 645,664
LUKOIL 4,177 565,983
MOL Magyar Olaj-es Gazipari /1/ 5,997 494,922
PetroChina /1/ /3/ 681,982 407,287
Petroleo Brasileiro 18,691 783,714
Sasol /1/ 16,748 392,322
Sibneft /3/ 16,666 256,656
3,546,548
OIL REFINING & MARKETING (2.43%)
Bharat Petroleum /1/ 30,383 240,772
Polski Koncern Naftowy Orlen
/1/ 32,405 448,850
SK /1/ 4,650 260,739
Thai Oil Public /1/ 215,406 352,880
1,303,241
PETROCHEMICALS (2.78%)
Formosa Chemicals & Fibre /1/ 225,000 457,948
Honam Petrochemical /1/ 7,320 330,563
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PETROCHEMICALS (CONTINUED)
SINOPEC Shanghai Petrochemical $
/1/ /3/ 831,210 307,758
Ultrapar Participacoes 21,499 397,517
1,493,786
PROPERTY & CASUALTY INSURANCE (0.12%)
LG Insurance /1/ /2/ 11,120 63,274
PUBLIC THOROUGHFARES (0.27%)
Shenzhen Expressway /1/ 404,000 147,316
REAL ESTATE OPERATOR & DEVELOPER (0.97%)
China Overseas Land &
Investment /1/ /3/ 1,654,395 342,381
IRSA Inversiones y
Representaciones /2/ 15,708 176,872
519,253
RETAIL-APPAREL & SHOE (0.93%)
Edgars Consolidated Stores /1/ 12,074 500,296
RETAIL-AUTOMOBILE (1.50%)
Astra International /1/ 462,931 512,263
Daewoo Motor Sales /1/ 28,800 294,325
806,588
RETAIL-CONSUMER ELECTRONICS (0.49%)
Grupo Elektra 9,031 262,170
RETAIL-DISCOUNT (0.34%)
Siam Makro /1/ 130,189 181,753
RETAIL-HOME FURNISHINGS (1.04%)
JD Group /1/ 54,431 560,619
RETAIL-HYPERMARKETS (0.16%)
Organizacion Soriana 23,004 84,618
RETAIL-MAJOR DEPARTMENT STORE (0.99%)
Hyundai Department Store /1/ 12,080 532,193
RETAIL-MISCELLANEOUS/DIVERSIFIED (1.50%)
Foschini /1/ 49,469 291,026
LG Home Shopping /1/ 2,900 231,671
Massmart Holdings /1/ 38,910 281,399
804,096
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (2.41%)
Novatek Microelectronics /1/ 165,000 736,034
Taiwan Semiconductor
Manufacturing /1/ 336,097 558,907
1,294,941
STEEL PRODUCERS (2.83%)
China Steel /1/ 219,000 225,245
POSCO 14,426 656,815
Tata Iron & Steel /1/ 46,838 366,425
Tenaris 4,800 274,320
1,522,805
TEA (0.48%)
Tata Tea /1/ 22,010 258,377
TELECOMMUNICATION SERVICES (2.57%)
AFK Sistema /2/ 28,503 444,647
KT Freetel /1/ 24,356 561,906
Orascom Telecom Holding /2/ 9,204 373,124
1,379,677
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TELEPHONE-INTEGRATED (2.07%)
$
Telefonos de Mexico 16,014 542,875
Telkom South Africa /1/ 32,562 568,834
1,111,709
TRANSPORT-MARINE (2.71%)
China Shipping Development /1/ 300,983 264,788
Evergreen Marine /1/ 657 628
Great Eastern Shipping /1/ 63,068 235,472
Orient Overseas International
/1/ 77,865 376,623
Precious Shipping /1/ 231,727 302,431
Wan Hai Lines /1/ 261,000 273,600
1,453,542
WATER (0.16%)
Cia de Saneamento Basico do
Estado de Sao Paulo /2/ 1,618,439 83,746
WEB PORTALS (0.08%)
Dacom /3/ 6,090 45,197
WIRE & CABLE PRODUCTS (0.55%)
LG Cable /1/ 13,570 298,126
WIRELESS EQUIPMENT (0.80%)
Gemtek Technology /1/ 218,827 429,418
Gemtek Technology-Rights /1/
/3/ 24,364 -
429,418
TOTAL COMMON STOCKS 47,672,474
Shares
Held Value
- --------------------------------------------------------------------------------------
PREFERRED STOCKS (6.96%)
COMMERCIAL BANKS (2.05%)
Banco Itau Holding Financeira 6,437 1,099,303
DIVERSIFIED MINERALS (1.53%)
Caemi Mineracao e Metalurgica 1,067,716 819,284
ELECTRIC-INTEGRATED (0.77%)
Cia Energetica de Minas Gerais 14,797,643 412,841
OIL REFINING & MARKETING (0.68%)
Cia Brasileira de Petroleo
Ipiranga 34,788 366,730
PETROCHEMICALS (0.13%)
Ultrapar Participacoes 3,924,987 70,891
STEEL PRODUCERS (1.49%)
Cia Siderurgica de Tubarao 7,734,358 381,955
Usinas Siderurgicas de Minas
Gerais 20,901 417,724
799,679
TEXTILE-PRODUCTS (0.31%)
Cia de Tecidos do Norte de
Minas - Coteminas 1,989,886 167,566
TOTAL PREFERRED STOCKS 3,736,294
Principal
Amount Value
- --------------------------------------------------------------------------------------
COMMERCIAL PAPER (1.41%)
ASSET BACKED SECURITIES (1.41%)
CAFCO
$ $
2.94%; 05/02/05 760,000 759,876
TOTAL COMMERCIAL PAPER 759,876
Maturity
Amount Value
- --------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (1.99%)
Merrill Lynch; 3.00%; dated
04/29/05 maturing 05/02/05
(collateralized by U.S.
Government Agency Securities;
$1,093,121; 11/01/05 - $
04/01/35) /4/ $ 1,068,810 1,068,544
TOTAL REPURCHASE AGREEMENTS 1,068,544
-----------
TOTAL PORTFOLIO INVESTMENTS (99.11%) 53,237,188
CASH, RECEIVABLES AND
OTHER ASSETS, NET OF
LIABILITIES (0.89%) 476,206
TOTAL NET ASSETS (100.00%) $53,713,394
-------------
/1 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of these
securities totaled $34,342,807 or 63.94% of net assets.
/2 /Non-income producing security.
/3 /Security or a portion of the security was on loan at the end of the period.
/4 /Security was purchased with the cash proceeds from securities loans.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 5,445,187
Unrealized Depreciation (1,586,084)
-----------
Net Unrealized Appreciation (Depreciation) 3,859,103
Cost for federal income tax purposes $49,378,085
INVESTMENTS BY COUNTRY (UNAUDITED)
Country Value Percentage of
Total Value
- ---------------------------------------------------------------
Argentina $ 451,192 0.85%
Austria 117,942 0.22
Brazil 5,524,223 10.38
China 1,772,812 3.33
Colombia 326,166 0.61
Egypt 657,840 1.24
Hong Kong 2,636,660 4.95
Hungary 890,323 1.67
India 3,257,991 6.12
Indonesia 806,666 1.52
Israel 1,859,784 3.49
Korea 9,682,336 18.19
Malaysia 1,560,800 2.93
Mexico 2,430,560 4.57
Netherlands 269,545 0.51
Panama 279,572 0.52
Peru 272,690 0.51
Philippines 498,792 0.94
Poland 448,850 0.84
Russia 1,861,110 3.50
South Africa 4,908,656 9.22
Taiwan 7,975,571 14.98
Thailand 1,659,853 3.12
Turkey 789,662 1.48
United Kingdom 469,172 0.88
United States 1,828,420 3.43
TOTAL $53,237,188 100.00%
------------- ---------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL INTERNATIONAL FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (97.96%)
ADVERTISING SALES (0.10%)
Telefonica Publicidad e $
Informacion /1/ /2/ 27,090 249,201
ADVERTISING SERVICES (0.51%)
Aegis Group /2/ 151,957 280,148
JC Decaux /2/ /3/ 37,688 999,353
1,279,501
AEROSPACE & DEFENSE EQUIPMENT (0.20%)
Zodiac /2/ 10,025 489,287
AGRICULTURAL OPERATIONS (0.10%)
Chaoda Modern Agriculture /2/ 266,751 106,156
IOI Berhad /2/ 58,019 139,918
246,074
AIRLINES (0.05%)
Korean Air Lines /2/ 7,000 129,627
AIRPORT DEVELOPMENT & MAINTENANCE (0.07%)
Kobenhavns Lufthavne /1/ /2/ 755 169,250
APPLICATIONS SOFTWARE (0.20%)
Infosys Technologies /2/ 7,487 324,518
Sage Group /2/ 48,147 180,897
505,415
AUTO-CARS & LIGHT TRUCKS (0.67%)
Hyundai Motor /2/ 2,265 123,277
Proton Holdings /2/ 43,842 90,554
Toyota Motor /2/ 40,207 1,458,027
1,671,858
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.31%)
Volvo /1/ /2/ 18,918 767,798
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.53%)
DENSO /2/ 42,100 995,728
Exedy /1/ /2/ 4,698 78,592
Keihin /1/ /2/ 10,228 170,829
Showa /2/ 6,629 84,800
1,329,949
BATTERIES & BATTERY SYSTEMS (0.01%)
Power Logics /2/ 3,190 36,937
BEVERAGES-WINE & SPIRITS (0.05%)
Davide Campari - Milano /2/ 1,102 78,415
Mercian /2/ 17,071 48,102
126,517
BREWERY (1.33%)
Asahi Breweries /2/ 100,000 1,267,444
Bryggerigruppen /2/ 943 72,871
Efes Breweries International /3/ 4,174 131,481
SABMiller /2/ 112,803 1,672,530
Wolverhampton & Dudley Breweries
/2/ 9,211 178,786
3,323,112
BUILDING & CONSTRUCTION PRODUCTS-
MISCELLANEOUS (0.09%)
Kingspan Group /2/ 20,180 226,896
BUILDING & CONSTRUCTION-MISCELLANEOUS (0.60%)
Abengoa /2/ 5,744 61,711
Eiffage /1/ /2/ 9,780 1,150,117
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
BUILDING & CONSTRUCTION-MISCELLANEOUS (CONTINUED)
$
JM /1/ /2/ 2,506 83,938
JM-Rights /2/ /3/ 2,506 2,038
Morgan Sindall /2/ 4,656 63,989
Orascom Construction Industries
/2/ 5,933 131,303
1,493,096
BUILDING PRODUCTS-CEMENT & AGGREGATE (1.49%)
Adelaide Brighton /1/ /2/ 151,389 189,858
BPB /2/ 170,124 1,482,291
Cementir /2/ 16,082 87,956
Cemex 15,440 111,111
Gujarat Ambuja Cements /2/ /3/ 13,153 127,223
Heracles General Cement /2/ 2,932 34,995
Italcementi /2/ 8,084 131,711
Rinker Group /1/ /2/ 160,873 1,438,331
Siam Cement /2/ 19,080 114,947
3,718,423
BUILDING PRODUCTS-WOOD (0.31%)
Travis Perkins /2/ 24,979 778,038
BUILDING-HEAVY CONSTRUCTION (1.66%)
Actividades de Construccion y
Servicios /2/ 56,919 1,392,353
Astaldi /2/ 7,791 46,131
Daelim Industrial /2/ 3,800 189,999
Empresas ICA Sociedad
Controladora /3/ 349,728 129,622
Hyundai Engineering &
Construction /2/ /3/ 7,540 168,060
Vinci /1/ /2/ 14,831 2,236,151
4,162,316
BUILDING-RESIDENTIAL & COMMERCIAL (0.14%)
Kaufman & Broad /2/ 831 46,212
Persimmon /2/ 23,572 305,549
351,761
BUSINESS TO BUSINESS-E COMMERCE (0.04%)
Submarino /3/ 15,694 107,455
CABLE TV (0.19%)
Premiere /3/ 12,589 487,555
CASINO HOTELS (0.05%)
Genting Berhad /2/ 25,332 122,790
CASINO SERVICES (0.10%)
Aristocrat Leisure /2/ 31,724 241,693
CELLULAR TELECOMMUNICATIONS (3.17%)
China Mobile /2/ 608,049 2,132,300
Digi.Com Berhad /2/ /3/ 60,900 81,090
Far EasTone Telecommunications
/2/ 330,700 404,019
Mobistar /2/ /3/ 2,294 196,087
O2 /3/ 732,486 1,640,291
Partner Communications /2/ /3/ 14,876 126,576
Vimpel Communications /3/ 3,486 114,062
Vodafone Group /2/ 1,234,889 3,232,070
7,926,495
CHEMICALS-DIVERSIFIED (1.74%)
BASF /1/ /2/ 25,424 1,669,160
DSM /2/ 3,673 246,826
Israel Chemicals /2/ 46,783 138,047
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
CHEMICALS-DIVERSIFIED (CONTINUED)
$
K+S /2/ 4,356 221,480
Mitsubishi Gas Chemical /2/ 32,308 157,596
Sumitomo Chemical /1/ /2/ 165,378 842,995
Tosoh /2/ 232,240 1,089,845
4,365,949
CHEMICALS-SPECIALTY (1.18%)
Auriga Industries /2/ 2,349 50,438
Clariant /1/ /2/ /3/ 53,327 840,474
Daicel Chemical Industries /2/ 27,466 147,387
Frutarom /3/ 17,317 128,442
Methanex 48,828 820,966
Syngenta /2/ /3/ 9,392 976,939
2,964,646
CIRCUIT BOARDS (0.65%)
IBIDEN /1/ /2/ 63,974 1,362,259
Unimicron Technology /2/ 345,000 271,379
1,633,638
COAL (0.05%)
Yanzhou Coal Mining /2/ 93,779 127,874
COMMERCIAL BANKS (11.09%)
Alpha Bank /2/ 22,633 732,026
Amagerbanken /2/ 481 74,359
Anglo Irish Bank /2/ 97,450 1,156,620
Australia & New Zealand
Banking Group /1/ /2/ 86,686 1,463,312
Banca Intesa /2/ 290,415 1,391,231
Banco de Sabadell /2/ 7,849 196,555
Banco Latinoamericano de
Exportaciones 6,300 119,007
Bancolombia 13,787 203,634
Bank Austria Creditanstalt /2/ 8,363 774,678
Bank Leumi Le-Israel /2/ 89,467 254,297
Bank of Fukuoka /2/ 56,347 341,311
Bank of Ireland /2/ 64,611 984,450
Bank of Kyoto /1/ /2/ 18,095 152,588
Bank of Piraeus /2/ 54,146 921,157
Bank Rakyat /2/ 439,593 123,196
Credicorp 8,240 142,964
Credit Suisse Group /1/ /2/ /3/ 63,545 2,684,840
DnB Holding /1/ /2/ 218,330 2,087,545
FinecoGroup /2/ /3/ 30,471 251,979
ForeningsSparbanken /1/ /2/ 87,955 2,071,739
ICICI Bank 6,200 112,096
KBC Groupe /1/ /2/ 23,514 1,866,376
Keiyo Bank /2/ 13,535 68,230
Korea Exchange Bank /2/ /3/ 25,900 219,646
National Bank of Canada 23,800 993,950
National Bank of Greece /2/ 46,889 1,581,208
OTP Bank /2/ 5,912 182,298
Raiffeisen International Bank
Holding /3/ 8,546 441,300
Royal Bank of Canada /3/ 8,825 527,060
Royal Bank of Scotland /2/ 85,187 2,576,804
Sapporo Hokuyo Holdings 18 132,792
Shiga Bank /1/ /2/ 8,129 51,987
Siam Commercial Bank Public /2/ 98,100 117,349
Societe Generale /2/ 17,890 1,789,235
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL BANKS (CONTINUED)
Standard Bank Group /2/ 42,638 $ 427,838
Suruga Bank /2/ 18,159 158,198
Taishin Financial Holdings /2/ 257,000 230,726
UTI Bank /3/ 26,378 139,434
27,744,015
COMMERCIAL SERVICES (0.12%)
Intertek Group /2/ 10,433 151,374
TIS /2/ 4,038 146,044
297,418
COMMUNICATIONS SOFTWARE (0.02%)
Telelogic /2/ /3/ 28,413 56,485
COMPUTER SERVICES (0.06%)
ALTEN /2/ /3/ 2,578 60,092
Computershare /2/ 12,734 50,479
EDB Business Partner /2/ /3/ 6,047 44,908
155,479
COMPUTERS (0.11%)
High Tech Computer /2/ 40,000 281,105
COMPUTERS-INTEGRATED SYSTEMS (0.34%)
Otsuka /1/ /2/ 11,119 843,589
COMPUTERS-PERIPHERAL EQUIPMENT (0.52%)
Logitech International /2/ /3/ 22,458 1,292,793
CONSULTING SERVICES (0.06%)
Jaakko Poyry Group /2/ 1,413 43,535
Savills /2/ 7,861 95,696
139,231
CONTAINERS-METAL & GLASS (0.03%)
Singamas Container Holdings /2/ 87,089 80,718
COSMETICS & TOILETRIES (0.03%)
Body Shop International /2/ 22,490 85,051
CRUISE LINES (0.55%)
Carnival /2/ 26,903 1,385,541
DISTRIBUTION-WHOLESALE (0.83%)
Esprit Holdings /2/ 26,257 195,593
Inchcape /2/ 6,327 215,050
Telewave 13 59,561
Univar /2/ 1,503 47,492
Wolseley /2/ 77,265 1,550,534
2,068,230
DIVERSIFIED FINANCIAL SERVICES (0.71%)
Acta Holding /2/ /3/ 51,173 92,379
JCG Holdings /2/ 28,388 25,547
Sampo Ojy /2/ 95,693 1,339,274
Shinhan Financial Group /2/ 12,032 314,013
1,771,213
DIVERSIFIED MANUFACTURING OPERATIONS (0.36%)
Charter /2/ /3/ 28,556 137,553
NKT Holding /2/ 3,049 107,651
Orica /2/ 54,261 668,754
913,958
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DIVERSIFIED MINERALS (2.02%)
$
Antofagasta /2/ 45,655 980,052
BHP Billiton /2/ 215,334 2,637,579
Teck Cominco 44,673 1,447,036
5,064,667
DIVERSIFIED OPERATIONS (1.02%)
Alfa 23,299 117,661
Brascan /1/ 42,361 1,535,183
Imperial Holdings /2/ /3/ 12,710 196,017
Wharf Holdings /2/ 214,000 714,660
2,563,521
ELECTRIC PRODUCTS-MISCELLANEOUS (0.45%)
Sharp /2/ 66,000 1,027,307
Ultra Electronics Holdings /2/ 6,919 99,177
1,126,484
ELECTRIC-GENERATION (0.50%)
Electric Power Development /2/ 36,351 1,100,148
National Thermal Power /2/ 77,931 147,769
1,247,917
ELECTRIC-INTEGRATED (2.42%)
ASM Brescia /2/ 30,601 100,630
E.ON /1/ /2/ 24,976 2,125,296
Fortum /2/ 95,084 1,446,882
International Power /2/ /3/ 199,179 695,495
Korea Electric Power /2/ 10,050 292,798
RWE /1/ /2/ 23,252 1,392,844
6,053,945
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.77%)
Asustek Computer /2/ 88,000 235,420
Funkwerk /2/ 982 39,814
Hon Hai Precision Industry /2/ 91,000 432,151
Jurong Technologies Industrial
/2/ 82,098 83,282
Samsung Electronics 2,394 1,094,918
Shibaura Mechatronics /1/ /2/ 5,546 49,045
1,934,630
ELECTRONIC COMPONENTS-SEMICONDUCTOR (0.24%)
Shinko Electric Industries /1/
/2/ 15,967 551,039
Thine Electronics /1/ 10 39,610
590,649
ELECTRONIC MEASUREMENT INSTRUMENTS (0.15%)
Leica Geosystems /2/ /3/ 406 117,020
Techem /2/ /3/ 3,072 127,059
Tokyo Seimitsu /2/ 3,625 123,119
367,198
ENERGY-ALTERNATE SOURCES (0.08%)
SolarWorld /2/ 1,358 189,084
ENGINEERING-RESEARCH & DEVELOPMENT
SERVICES (0.12%)
COMSYS Holdings /1/ /2/ 14,509 124,421
Samsung Engineering /2/ 18,450 167,512
291,933
FINANCE-CONSUMER LOANS (0.85%)
African Bank Investments /2/ 50,304 134,844
Aiful /2/ 12,371 919,883
Aiful /3/ 6,185 450,986
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-CONSUMER LOANS (CONTINUED)
$
Nissin /1/ /2/ 7,659 17,243
Sanyo Shinpan Finance /2/ 8,919 602,003
2,124,959
FINANCE-CREDIT CARD (0.05%)
OMC Card /2/ 10,602 134,133
FINANCE-INVESTMENT BANKER & BROKER (0.47%)
Ichiyoshi Securities /2/ 6,176 57,066
Mediobanca /2/ 60,267 994,018
Samsung Securities /2/ 4,890 116,795
1,167,879
FINANCE-LEASING COMPANY (0.61%)
ORIX /2/ 9,700 1,316,005
Ricoh Leasing /2/ 3,050 74,989
Sumisho Lease /2/ 3,687 132,938
1,523,932
FINANCE-OTHER SERVICES (0.26%)
Aktiv Kapital /1/ /2/ 2,932 43,867
Bursa Malaysia /3/ 124,955 125,613
Grupo Financiero Banorte 33,463 215,462
Intrum Justitia /1/ /2/ /3/ 7,828 56,646
Intrum Justitia-Rights /2/ /3/ 7,828 2,970
SFE /1/ /2/ 20,313 145,004
TSX Group 1,035 51,133
640,695
FINANCIAL GUARANTEE INSURANCE (0.07%)
Euler Hermes /1/ /2/ 2,295 183,383
FISHERIES (0.32%)
Toyo Suisan Kaisha /1/ /2/ 50,579 794,686
FOOD-CONFECTIONERY (0.03%)
Lindt & Spruengli /2/ 4 63,272
FOOD-DAIRY PRODUCTS (0.05%)
Binggrae /2/ 3,355 132,325
FOOD-FLOUR & GRAIN (0.04%)
Nisshin Seifun Group /2/ 8,519 88,523
FOOD-MEAT PRODUCTS (0.02%)
Yonekyu /2/ 4,134 47,188
FOOD-MISCELLANEOUS/DIVERSIFIED (0.66%)
Kikkoman /2/ 64,441 619,337
Orkla /1/ /2/ 31,080 1,044,083
1,663,420
FOOD-RETAIL (1.17%)
Colruyt /2/ 5,686 861,413
Tesco /2/ 352,205 2,077,227
2,938,640
FOOD-WHOLESALE & DISTRIBUTION (0.31%)
Fyffes 273,320 769,526
FORESTRY (0.03%)
Great Southern Plantations /2/ 31,020 87,247
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
GAS-DISTRIBUTION (0.07%)
$
OAO Gazprom 5,165 174,375
GOLD MINING (0.02%)
NovaGold Resources /3/ 8,048 62,270
HOTELS & MOTELS (0.55%)
InterContinental Hotels Group /2/ 114,947 1,371,454
HUMAN RESOURCES (0.46%)
Capita Group /2/ 25,287 182,763
Ranstad Holdings /2/ 23,840 971,276
1,154,039
IMPORT & EXPORT (1.10%)
Kanematsu /2/ /3/ 88,171 130,911
Mitsubishi /1/ /2/ 65,101 891,487
Mitsui /2/ 168,000 1,593,416
Testrite International /2/ 199,722 133,976
2,749,790
INDEPENDENT POWER PRODUCER (0.07%)
YTL Power International /2/ 355,383 185,165
INDUSTRIAL AUTOMATION & ROBOTS (0.06%)
CKD /2/ 22,615 151,965
INSTRUMENTS-SCIENTIFIC (0.07%)
As One /2/ 1,412 30,519
HORIBA /2/ 7,434 137,663
168,182
INTERNET SECURITY (0.11%)
Check Point Software Technologies
/3/ 12,906 270,381
INVESTMENT COMPANIES (0.11%)
Macquarie Airports Management /1/
/2/ 55,180 144,698
SM Investments /3/ 27,334 126,172
270,870
LEISURE & RECREATION PRODUCTS (0.51%)
Sega Sammy Holdings /2/ 21,327 1,248,858
Trigano /2/ 462 39,429
1,288,287
LIFE & HEALTH INSURANCE (0.78%)
Cathay Financial Holding /2/ 152,000 275,659
Friends Provident /2/ 328,495 1,013,391
Industrial-Alliance Life
Insurance /3/ 2,062 93,656
Metropolitan Holdings /2/ 97,742 173,219
Sanlam /2/ 91,219 173,236
Shin Kong Financial Holding /2/ 234,987 219,939
1,949,100
LOTTERY SERVICES (0.04%)
Intralot-Integrated Lottery
Systems & Services /2/ 3,518 104,828
MACHINERY-CONSTRUCTION & MINING (0.40%)
Komatsu /1/ /2/ 141,000 992,196
MACHINERY-ELECTRICAL (0.76%)
Nidec /2/ 11,307 1,326,602
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MACHINERY-ELECTRICAL (CONTINUED)
$
SMC /2/ 5,500 577,394
1,903,996
MACHINERY-FARM (0.40%)
Kubota /2/ 194,351 1,001,527
MACHINERY-GENERAL INDUSTRY (0.99%)
Andritz /1/ /2/ 1,428 119,999
MAN /2/ 39,517 1,670,673
Stork /2/ 13,701 504,555
Sumitomo Heavy Industries /2/ 47,115 190,275
2,485,502
MEDICAL INSTRUMENTS (0.10%)
Elekta /2/ /3/ 4,368 153,531
Topcon /2/ 5,249 92,268
245,799
MEDICAL LABORATORY & TESTING SERVICE (0.05%)
Diagnosticos da America /3/ 4,026 132,600
MEDICAL LASER SYSTEMS (0.13%)
Carl Zeiss Meditec /2/ /3/ 16,738 329,413
MEDICAL PRODUCTS (0.95%)
Gambro /1/ /2/ 49,767 674,046
Nobel Biocare Holding /2/ 950 204,225
Phonak Holding /2/ 21,451 751,180
Terumo /2/ 25,134 744,922
2,374,373
MEDICAL-BIOMEDICAL/GENE (0.15%)
Cambridge Antibody Technology
Group /2/ /3/ 35,781 383,217
MEDICAL-DRUGS (5.33%)
Astellas Pharma /2/ 19,454 703,979
AstraZeneca /2/ 49,564 2,173,886
CSL /2/ 15,707 388,947
Dong-A Pharmaceutical /2/ 4,770 151,302
Fujirebio /2/ 3,901 63,878
GlaxoSmithKline /2/ 39,421 996,995
Hisamitsu Pharmaceutical /1/ /2/ 2,728 72,822
Merck /1/ /2/ 11,942 912,298
Novartis /1/ /2/ 38,322 1,872,764
Ono Pharmaceutical /2/ 17,957 911,883
Roche Holding /1/ /2/ 20,170 2,450,140
Rohto Pharmaceutical /2/ 31,557 398,879
Sanofi-Aventis /1/ /2/ 7,966 707,690
Santen Pharmaceutical /2/ 26,695 595,403
Schering /1/ /2/ 14,242 940,661
13,341,527
MEDICAL-HOSPITALS (0.27%)
Capio /2/ /3/ 43,565 675,607
MEDICAL-NURSING HOMES (0.04%)
Extendicare /3/ 7,071 94,547
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.54%)
Alliance Unichem /2/ 75,503 1,155,777
Celesio /1/ /2/ 2,376 189,719
1,345,496
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
METAL PROCESSORS & FABRICATION (0.05%)
$
CFF Recycling /2/ 2,017 62,711
Tocalo /2/ 2,482 53,663
116,374
METAL-DIVERSIFIED (0.58%)
Rio Tinto /2/ 47,924 1,449,240
MISCELLANEOUS INVESTING (0.40%)
Nippon Building Fund /1/ 44 394,191
Rodamco Europe /1/ /2/ 7,971 603,209
997,400
MISCELLANEOUS MANUFACTURERS (0.06%)
Amano /1/ /2/ 9,902 108,495
Balda /1/ /2/ 5,016 49,195
157,690
MONEY CENTER BANKS (4.95%)
Banco Bilbao Vizcaya Argentaria
/2/ 172,501 2,680,244
BNP Paribas /2/ 28,664 1,897,627
HBOS /2/ 143,823 2,135,251
HSBC Holdings /2/ 38,300 613,163
Mizuho Financial Group 474 2,223,938
UBS /1/ /2/ 35,214 2,827,163
12,377,386
MORTGAGE BANKS (0.94%)
Home Capital Group /3/ 4,954 138,007
Hypo Real Estate Holding /2/ /3/ 53,536 2,225,702
2,363,709
MULTI-LINE INSURANCE (2.49%)
Allianz /1/ /2/ 11,530 1,394,591
AXA /2/ 60,656 1,519,862
Baloise Holding /1/ /2/ 2,810 144,472
Codan /2/ 2,397 115,172
Fondiaria-Sai /2/ 30,158 776,529
Storebrand /1/ /2/ 148,214 1,112,648
Zurich Financial Services /2/ 6,841 1,161,753
6,225,027
MULTIMEDIA (0.10%)
APN News & Media /2/ 22,021 82,678
Impresa /2/ /3/ 8,715 61,956
Promotora de Informaciones /2/ 5,386 103,053
247,687
NON-FERROUS METALS (0.04%)
Grupo Mexico /3/ 19,592 91,573
International Nickel Indonesia
/2/ 7,079 10,364
101,937
NON-HOTEL GAMBLING (0.42%)
Greek Organisation of Football
Prognostics /2/ 32,990 867,509
Paddy Power 10,403 182,276
1,049,785
OFFICE AUTOMATION & EQUIPMENT (0.64%)
Canon /2/ 28,021 1,456,565
Neopost /2/ 1,683 141,516
1,598,081
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL & GAS DRILLING (0.36%)
$
AOC Holdings 6,815 97,241
Precision Drilling /3/ 11,100 803,124
900,365
OIL COMPANY-EXPLORATION & PRODUCTION (1.33%)
EnCana 33,400 2,143,540
Oil & Natural Gas /2/ 7,156 133,215
Oil Search /2/ 398,634 715,631
PTT Public /2/ 26,458 134,321
Tullow Oil /2/ 62,319 191,479
3,318,186
OIL COMPANY-INTEGRATED (5.65%)
BP Amoco /2/ 323,067 3,299,995
China Petroleum & Chemical /2/ 797,937 313,838
ENI /2/ 101,546 2,561,667
LUKOIL 1,839 249,184
MOL Magyar Olaj-es Gazipari /2/ 2,958 244,119
OMV /2/ 1,585 489,724
PetroChina /2/ 342,603 204,606
Petroleo Brasileiro 10,302 431,963
Sasol /2/ 7,714 180,700
Shell Transport & Trading /2/ 247,671 2,227,576
Sibneft /3/ 6,777 104,366
Total /1/ /2/ 17,178 3,832,201
14,139,939
OIL REFINING & MARKETING (2.07%)
Bharat Petroleum /2/ 14,701 116,499
Caltex Australia /2/ 53,068 582,258
ERG /2/ 31,024 476,523
Neste Oil Oyj /1/ /3/ 29,255 655,633
Polski Koncern Naftowy Orlen /2/ 13,918 192,782
S-Oil /2/ 7,190 505,077
SK /2/ 2,360 132,332
Statoil /2/ 89,985 1,584,175
Thai Oil Public /2/ 569,889 933,597
5,178,876
OIL-FIELD SERVICES (0.17%)
Fred. Olsen Energy /2/ /3/ 4,617 87,926
Ocean Rig /2/ /3/ 11,944 68,388
Stolt Offshore /2/ /3/ 23,498 173,691
TGS-NOPEC Geophysical /2/ /3/ 3,783 102,561
432,566
OPTICAL SUPPLIES (0.62%)
HOYA /2/ 14,800 1,544,277
PETROCHEMICALS (0.30%)
Formosa Chemicals & Fibre /2/ 109,000 221,850
Honam Petrochemical /2/ 3,540 159,862
SINOPEC Shanghai Petrochemical
/2/ 500,060 185,149
Ultrapar Participacoes 9,969 184,327
751,188
PROPERTY & CASUALTY INSURANCE (0.60%)
Dongbu Insurance /2/ 8,200 65,914
LG Insurance /2/ /3/ 5,620 31,979
Millea Holdings 83 1,130,486
Northbridge Financial 3,724 85,314
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PROPERTY & CASUALTY INSURANCE (CONTINUED)
$
Promina Group /1/ /2/ 45,309 181,753
1,495,446
PROPERTY TRUST (0.08%)
Commonwealth Property Office Fund
/2/ 194,282 192,256
PUBLIC THOROUGHFARES (0.05%)
Autostrada Torino /2/ 3,076 63,064
Shenzhen Expressway /2/ 204,000 74,387
137,451
PUBLISHING-BOOKS (0.04%)
Yell Group /2/ 12,901 99,393
PUBLISHING-NEWSPAPERS (0.02%)
Spir Communication /2/ 219 44,210
PUBLISHING-PERIODICALS (0.40%)
Eniro /1/ /2/ /3/ 87,901 1,001,434
QUARRYING (0.06%)
Eramet /2/ 1,518 142,990
RACETRACKS (0.02%)
Snai /2/ /3/ 4,100 51,304
REAL ESTATE MANAGEMENT & SERVICES (0.44%)
AEON Mall /2/ 36 1,360
Beni Stabili /2/ 391,024 399,452
Castellum /2/ 2,408 89,223
Corio /1/ /2/ 4,876 261,856
Creed 49 127,663
Midland Realty Holdings /1/ /2/ 333,499 210,401
1,089,955
REAL ESTATE OPERATOR & DEVELOPER (1.97%)
Capital & Regional /2/ 7,200 96,515
China Overseas Land & Investment
/2/ 828,299 171,419
Fadesa Inmobiliaria /2/ /3/ 11,918 270,910
Great Eagle Holdings /2/ 218,000 492,709
Hammerson /2/ 49,099 798,921
Inmobiliaria Colonial /2/ 5,824 302,041
Inmobiliaria Urbis /1/ /2/ 8,662 132,757
IRSA Inversiones y
Representaciones /3/ 7,306 82,266
JOINT /1/ /2/ 2,275 58,612
Kerry Properties /2/ 56,131 122,831
Land Securities Group /2/ 55,179 1,403,061
Mitsui Fudosan /2/ 90,230 1,006,327
4,938,369
RENTAL-AUTO & EQUIPMENT (0.04%)
Northgate /2/ 6,764 106,098
RETAIL-APPAREL & SHOE (0.34%)
Aoki International /1/ /2/ 3,756 48,027
Cortefiel /2/ 29,081 534,484
Edgars Consolidated Stores /2/ 4,348 180,163
POINT /1/ /2/ 2,203 84,225
846,899
RETAIL-AUTOMOBILE (0.15%)
Astra International /2/ 212,986 235,683
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-AUTOMOBILE (CONTINUED)
$
Daewoo Motor Sales /2/ 14,480 147,980
383,663
RETAIL-BUILDING PRODUCTS (0.10%)
Grafton Group /2/ 21,461 241,332
RETAIL-CONSUMER ELECTRONICS (0.33%)
Carphone Warehouse /2/ 69,143 196,233
Grupo Elektra 2,980 86,510
Yamada Denki /1/ /2/ 11,500 549,231
831,974
RETAIL-CONVENIENCE STORE (0.33%)
Alimentation Couche Tard /3/ 61,000 816,606
RETAIL-DISCOUNT (0.04%)
Siam Makro /2/ 70,620 98,590
RETAIL-DRUG STORE (0.06%)
Sundrug /2/ 2,200 82,941
Tsuruha /2/ 1,887 62,499
145,440
RETAIL-HOME FURNISHINGS (0.11%)
JD Group /2/ 27,892 287,277
RETAIL-HYPERMARKETS (0.02%)
Organizacion Soriana 10,437 38,392
RETAIL-MAJOR DEPARTMENT STORE (0.13%)
David Jones /1/ /2/ 56,092 77,037
Hyundai Department Store /2/ 5,600 246,712
323,749
RETAIL-MISCELLANEOUS/DIVERSIFIED (0.40%)
Foschini /2/ 25,089 147,599
LG Home Shopping /2/ 1,035 82,682
Massmart Holdings /2/ 17,938 129,729
Ryohin Keikaku /2/ 12,956 652,038
1,012,048
RETAIL-OFFICE SUPPLIES (0.01%)
Bechtle /2/ 981 21,530
RETAIL-PUBS (0.61%)
Punch Taverns /2/ 125,629 1,525,913
RETAIL-VIDEO RENTAL (0.03%)
GEO 24 67,589
RUBBER & PLASTIC PRODUCTS (0.01%)
Semperit Holding /2/ 1,040 30,447
RUBBER-TIRES (1.03%)
Continental /2/ 34,753 2,574,524
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (0.24%)
Novatek Microelectronics /2/ 76,000 339,021
Taiwan Semiconductor
Manufacturing /2/ 156,000 259,418
598,439
SOAP & CLEANING PREPARATION (0.35%)
Reckitt Benckiser /2/ 27,292 887,577
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
SOAP & CLEANING PRODUCTS (0.04%)
$
McBride /2/ 32,470 91,861
SPECIAL PURPOSE BANKS (0.33%)
DEPFA Bank /2/ 50,312 776,967
IKB Deutsche Industriebank /2/ 1,655 44,390
821,357
STEEL PIPE & TUBE (0.02%)
Vallourec /2/ 286 60,358
STEEL PRODUCERS (1.73%)
China Steel /2/ 108,265 111,352
Corus Group /2/ /3/ 251,462 207,990
Dongkuk Steel Mill /2/ 4,460 63,963
Gerdau AmeriSteel /3/ 16,700 83,171
INI Steel /2/ 7,940 125,553
IPSCO 5,363 256,409
JFE Holdings /1/ /2/ 60,700 1,683,217
Nippon Steel /1/ /2/ 398,426 1,008,806
POSCO 8,224 374,439
Russel Metals /3/ 10,750 124,208
Tata Iron & Steel /2/ 23,759 185,872
Tenaris 2,000 114,300
4,339,280
TEA (0.04%)
Tata Tea /2/ 8,848 103,867
TELECOMMUNICATION EQUIPMENT (0.04%)
Option /1/ /2/ /3/ 2,946 89,264
TELECOMMUNICATION SERVICES (1.44%)
AFK Sistema /3/ 12,634 197,090
KT Freetel /2/ 11,173 257,767
Orascom Telecom Holding /3/ 4,621 187,333
StarHub /2/ /3/ 1,214,921 983,622
Telenor /2/ 152,484 1,276,535
TeliaSonera /1/ /2/ 134,525 710,384
3,612,731
TELEPHONE-INTEGRATED (0.75%)
Hellenic Telecommunications
Organization /2/ 72,963 1,367,672
Telefonos de Mexico 7,376 250,047
Telkom South Africa /2/ 14,998 262,004
1,879,723
TELEVISION (1.34%)
Antena 3 de Television /2/ 7,204 141,663
CanWest Global Communications /3/ 15,086 165,171
Mediaset /2/ 142,048 1,850,587
Modern Times Group /2/ /3/ 38,532 1,193,626
3,351,047
TOBACCO (2.21%)
British American Tobacco /2/ 80,041 1,502,410
Imperial Tobacco Group /2/ 71,233 2,043,631
Japan Tobacco 154 1,982,037
5,528,078
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TOOLS-HAND HELD (0.06%)
$
Makita /1/ /2/ 8,032 151,617
TRANSPORT-MARINE (1.14%)
China Shipping Development /2/ 127,699 112,342
Dampskibsselskabet Torm /1/ /2/ 3,078 155,059
Great Eastern Shipping /2/ 31,439 117,381
Kawasaki Kisen Kaisha /2/ 24,197 157,482
Mitsui O.S.K. Lines /2/ 131,542 828,014
Nippon Yusen Kabushiki Kaisha /1/
/2/ 133,366 791,027
Orient Overseas International /2/ 73,271 354,405
Precious Shipping /2/ 117,479 153,324
Wan Hai Lines /2/ 131,000 137,324
Wilhelmsen /2/ 1,771 42,498
2,848,856
TRANSPORT-RAIL (0.51%)
Canadian National Railway 22,000 1,266,584
TRANSPORT-SERVICES (0.51%)
Arriva /2/ 12,432 119,979
Exel /2/ 60,577 957,387
Toll Holdings /1/ /2/ 19,491 193,700
1,271,066
TRAVEL SERVICES (0.03%)
H.I.S. /2/ 3,685 84,379
WATER (0.27%)
Cia de Saneamento Basico do
Estado de Sao Paulo /3/ 731,258 37,839
Kelda Group /2/ 30,050 363,592
Pennon Group /2/ 14,990 281,520
682,951
WEB PORTALS (0.01%)
Dacom /3/ 2,760 20,483
WIRE & CABLE PRODUCTS (0.05%)
LG Cable /2/ 6,250 137,310
WIRELESS EQUIPMENT (1.07%)
Gemtek Technology /2/ 107,000 209,973
Gemtek Technology-Rights /2/ /3/ 11,913 -
Nokia /1/ 154,600 2,472,834
2,682,807
TOTAL COMMON STOCKS 245,148,546
Shares
Held Value
- ------------------------------------------------------------------------------------------
PREFERRED STOCKS (0.66%)
COMMERCIAL BANKS (0.20%)
Banco Itau Holding Financeira 2,985 509,774
DIVERSIFIED MINERALS (0.15%)
Caemi Mineracao e Metalurgica 495,082 379,888
Shares
Held Value
- ------------------------------------------------------------------------------------------
PREFERRED STOCKS (CONTINUED)
ELECTRIC-INTEGRATED (0.04%)
$
Cia Energetica de Minas Gerais 3,553,675 99,144
OIL REFINING & MARKETING (0.07%)
Cia Brasileira de Petroleo
Ipiranga 16,131 170,051
PETROCHEMICALS (0.01%)
Ultrapar Participacoes 1,903,795 34,386
STEEL PRODUCERS (0.15%)
Cia Siderurgica de Tubarao 3,561,613 175,887
Usinas Siderurgicas de Minas
Gerais 9,627 192,404
368,291
TEXTILE-PRODUCTS (0.04%)
Cia de Tecidos do Norte de Minas
- Coteminas 1,015,744 85,535
TOTAL PREFERRED STOCKS 1,647,069
Principal
Amount Value
- -----------------------------------------------------------------------------------
COMMERCIAL PAPER (0.34%)
ASSET BACKED SECURITIES (0.34%)
CAFCO
$ $
2.94%; 05/02/05 850,000 849,860
TOTAL COMMERCIAL PAPER 849,860
Maturity
Amount Value
- -----------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (17.77%)
Merrill Lynch; 3.00%; dated
04/29/05 maturing 05/02/05
(collateralized by U.S.
Government Agency Securities;
$45,485,022; 11/01/05 -
04/01/35) /4/ $44,473,431 $ 44,462,316
TOTAL REPURCHASE AGREEMENTS 44,462,316
------------
TOTAL PORTFOLIO INVESTMENTS (116.73%) 292,107,791
LIABILITIES, NET OF
CASH, RECEIVABLES
AND OTHER ASSETS
(-16.73%) (41,874,764)
TOTAL NET ASSETS (100.00%) $250,233,027
---------------
/1 /Security or a portion of the security was on loan at the end of the period.
/2 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of these
securities totaled $214,138,500 or 85.58% of net assets.
/3 /Non-income producing security.
/4 /Security was purchased with the cash proceeds from securities loans.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 29,061,484
Unrealized Depreciation (5,566,111)
------------
Net Unrealized Appreciation (Depreciation) 23,495,373
Cost for federal income tax purposes $268,612,127
INVESTMENTS BY COUNTRY (UNAUDITED)
Country Value Percentage of
Total Value
- ----------------------------------------------------------------
$
Argentina 196,566 0.07%
Australia 6,843,635 2.34
Austria 1,856,149 0.64
Belgium 3,013,141 1.03
Bermuda 235,948 0.08
Brazil 2,541,253 0.87
Canada 11,507,936 3.94
Cayman Islands 106,156 0.04
China 890,322 0.30
Colombia 203,634 0.07
Denmark 744,800 0.25
Egypt 318,636 0.11
Finland 5,958,158 2.04
France 15,402,424 5.27
Germany 16,604,988 5.68
Greece 5,609,394 1.92
Hong Kong 4,392,509 1.50
Hungary 426,417 0.15
India 1,507,874 0.52
Indonesia 369,243 0.13
Ireland 4,338,066 1.48
Israel 917,743 0.31
Italy 9,261,198 3.17
Japan 46,220,368 15.82
Korea 5,489,262 1.88
Luxembourg 173,691 0.06
Malaysia 745,131 0.25
Mexico 1,040,377 0.36
Netherlands 2,766,695 0.95
Norway 7,587,511 2.60
Panama 119,007 0.04
Peru 142,964 0.05
Philippines 126,172 0.04
Poland 192,782 0.07
Portugal 61,956 0.02
Russia 839,078 0.29
Singapore 1,066,904 0.37
South Africa 2,292,626 0.78
Spain 6,064,973 2.08
Sweden 7,539,464 2.58
Switzerland 15,387,035 5.27
Taiwan 3,763,313 1.29
Thailand 1,552,128 0.53
United Kingdom 50,377,988 17.25
United States 45,312,176 15.51
TOTAL $292,107,791 100.00%
-------------- ---------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL INTERNATIONAL SMALLCAP FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (97.60%)
ADVERTISING SALES (0.97%)
Telefonica Publicidad e $
Informacion /1/ /2/ 76,148 700,485
ADVERTISING SERVICES (1.09%)
Aegis Group /2/ 427,228 787,638
AGRICULTURAL OPERATIONS (0.41%)
Chaoda Modern Agriculture /2/ 741,078 294,919
AIRPORT DEVELOPMENT & MAINTENANCE (0.66%)
Kobenhavns Lufthavne /1/ /2/ 2,124 476,142
APPLICATIONS SOFTWARE (0.70%)
Sage Group /2/ 135,364 508,588
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (1.25%)
Exedy /1/ /2/ 13,255 221,740
Keihin /1/ /2/ 28,698 479,317
Showa /2/ 15,814 202,298
903,355
BEVERAGES-WINE & SPIRITS (0.49%)
Davide Campari - Milano /2/ 3,124 222,296
Mercian /2/ 48,328 136,175
358,471
BREWERY (0.96%)
Bryggerigruppen /2/ 2,642 204,162
Wolverhampton & Dudley Breweries
/2/ 25,321 491,483
695,645
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.89%)
Kingspan Group /2/ 57,469 646,158
BUILDING & CONSTRUCTION-MISCELLANEOUS (1.33%)
Abengoa /2/ 15,618 167,793
Eiffage /2/ 3,193 375,493
JM /1/ /2/ 7,044 235,936
JM-Rights /2/ /3/ 7,044 5,729
Morgan Sindall /2/ 13,096 179,982
964,933
BUILDING PRODUCTS-CEMENT & AGGREGATE (2.59%)
Adelaide Brighton /1/ /2/ 436,116 546,936
BPB /2/ 72,724 633,645
Cementir /2/ 44,013 240,718
Heracles General Cement /2/ 8,266 98,658
Italcementi /2/ 22,190 361,536
1,881,493
BUILDING-HEAVY CONSTRUCTION (2.23%)
Astaldi /2/ 21,884 129,576
Daelim Industrial /2/ 10,992 549,596
Vinci /2/ 6,214 936,919
1,616,091
BUILDING-RESIDENTIAL & COMMERCIAL (1.36%)
Kaufman & Broad /2/ 2,341 130,185
Persimmon /2/ 66,274 859,067
989,252
CASINO SERVICES (0.94%)
Aristocrat Leisure /1/ /2/ 89,192 679,520
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
CELLULAR TELECOMMUNICATIONS (0.73%)
$
Mobistar /2/ /3/ 6,204 530,308
CHEMICALS-DIVERSIFIED (3.02%)
DSM /2/ 10,416 699,954
K+S /2/ 12,341 627,476
Mitsubishi Gas Chemical /2/ 91,509 446,374
Tosoh /2/ 88,352 414,614
2,188,418
CHEMICALS-SPECIALTY (1.85%)
Auriga Industries /2/ 6,600 141,717
Daicel Chemical Industries /2/ 77,793 417,452
Methanex 46,493 781,706
1,340,875
CIRCUIT BOARDS (0.93%)
IBIDEN /1/ /2/ 31,671 674,400
COMMERCIAL BANKS (4.92%)
Amagerbanken /2/ 1,345 207,928
Banco de Sabadell /1/ /2/ 21,838 546,867
Bank of Kyoto /1/ /2/ 48,444 408,510
Bank of Piraeus /2/ 31,564 536,981
FinecoGroup /2/ /3/ 85,669 708,437
Keiyo Bank /2/ 38,052 191,819
Sapporo Hokuyo Holdings 51 376,242
Shiga Bank /1/ /2/ 23,790 152,143
Suruga Bank /2/ 50,050 436,025
3,564,952
COMMERCIAL SERVICES (1.16%)
Intertek Group /2/ 29,557 428,845
TIS /2/ 11,340 410,139
838,984
COMMUNICATIONS SOFTWARE (0.22%)
Telelogic /2/ /3/ 80,351 159,739
COMPUTER SERVICES (0.60%)
ALTEN /2/ /3/ 7,055 164,448
Computershare /2/ 36,097 143,094
EDB Business Partner /2/ /3/ 16,889 125,425
432,967
COMPUTERS-PERIPHERAL EQUIPMENT (0.79%)
Logitech International /2/ /3/ 9,950 572,771
CONSULTING SERVICES (0.53%)
Jaakko Poyry Group /2/ 3,971 122,346
Savills /2/ 21,380 260,271
382,617
CONTAINERS-METAL & GLASS (0.31%)
Singamas Container Holdings /2/ 246,137 228,132
COSMETICS & TOILETRIES (0.32%)
Body Shop International /2/ 61,478 232,493
DISTRIBUTION-WHOLESALE (1.25%)
Inchcape /2/ 17,788 604,600
Telewave 38 174,102
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DISTRIBUTION-WHOLESALE (CONTINUED)
$
Univar /2/ 4,120 130,185
908,887
DIVERSIFIED FINANCIAL SERVICES (0.45%)
Acta Holding /2/ /3/ 143,873 259,723
JCG Holdings /2/ 77,666 69,893
329,616
DIVERSIFIED MANUFACTURING OPERATIONS (0.95%)
Charter /2/ /3/ 78,658 378,892
NKT Holding /2/ 8,736 308,440
687,332
ELECTRIC PRODUCTS-MISCELLANEOUS (0.37%)
Ultra Electronics Holdings /2/ 18,931 271,358
ELECTRIC-INTEGRATED (0.38%)
ASM Brescia /1/ /2/ 83,693 275,222
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.66%)
Funkwerk /2/ 2,680 108,656
Jurong Technologies Industrial
/2/ 231,973 235,319
Shibaura Mechatronics /1/ /2/ 15,585 137,822
481,797
ELECTRONIC COMPONENTS-SEMICONDUCTOR (0.15%)
Thine Electronics 28 110,909
ELECTRONIC MEASUREMENT INSTRUMENTS (1.41%)
Leica Geosystems /2/ /3/ 1,118 322,238
Techem /2/ /3/ 8,526 352,637
Tokyo Seimitsu /2/ 10,197 346,331
1,021,206
ENERGY-ALTERNATE SOURCES (0.73%)
SolarWorld /1/ /2/ 3,803 529,520
ENGINEERING-RESEARCH & DEVELOPMENT SERVICES (0.48%)
COMSYS Holdings /1/ /2/ 40,603 348,190
FINANCE-CONSUMER LOANS (0.06%)
Nissin /1/ /2/ 20,837 46,913
FINANCE-CREDIT CARD (0.46%)
OMC Card /2/ 26,180 331,220
FINANCE-INVESTMENT BANKER & BROKER (0.24%)
Ichiyoshi Securities /2/ 18,848 174,154
FINANCE-LEASING COMPANY (0.83%)
Ricoh Leasing /2/ 8,716 214,297
Sumisho Lease /2/ 10,737 387,131
601,428
FINANCE-OTHER SERVICES (1.14%)
Aktiv Kapital /1/ /2/ 8,267 123,685
Intrum Justitia /1/ /2/ /3/ 19,888 143,916
Intrum Justitia-Rights /2/ /3/ 19,888 7,547
SFE /1/ /2/ 56,300 401,896
TSX Group 3,032 149,794
826,838
FINANCIAL GUARANTEE INSURANCE (0.69%)
Euler Hermes /1/ /2/ 6,280 501,805
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FISHERIES (0.95%)
$
Toyo Suisan Kaisha /1/ /2/ 43,819 688,475
FOOD-CONFECTIONERY (0.26%)
Lindt & Spruengli /2/ 12 189,815
FOOD-FLOUR & GRAIN (0.35%)
Nisshin Seifun Group /2/ 24,114 250,575
FOOD-MEAT PRODUCTS (0.18%)
Yonekyu /2/ 11,655 133,037
FOOD-RETAIL (1.00%)
Colruyt /2/ 4,801 727,338
FOOD-WHOLESALE & DISTRIBUTION (0.44%)
Fyffes 112,871 317,786
FORESTRY (0.33%)
Great Southern Plantations /2/ 85,581 240,705
GOLD MINING (0.24%)
NovaGold Resources /3/ 22,129 171,220
HOME FURNISHINGS (0.09%)
Nobia /1/ /2/ 4,176 67,041
HUMAN RESOURCES (1.39%)
Capita Group /2/ 69,718 503,889
Ranstad Holdings /2/ 12,370 503,972
1,007,861
IMPORT & EXPORT (0.51%)
Kanematsu /2/ /3/ 247,892 368,053
INDUSTRIAL AUTOMATION & ROBOTS (0.58%)
CKD /1/ /2/ 62,490 419,910
INSTRUMENTS-SCIENTIFIC (0.57%)
As One /2/ 4,048 87,459
HORIBA /2/ 17,735 328,418
415,877
INVESTMENT COMPANIES (0.55%)
Macquarie Airports Management /1/
/2/ 151,008 395,986
LEISURE & RECREATION PRODUCTS (0.15%)
Trigano /2/ 1,281 109,326
LIFE & HEALTH INSURANCE (1.12%)
Friends Provident /2/ 178,580 550,910
Industrial-Alliance Life
Insurance /3/ 5,797 263,301
814,211
LOTTERY SERVICES (0.40%)
Intralot-Integrated Lottery
Systems & Services /2/ 9,774 291,241
MACHINERY-GENERAL INDUSTRY (2.05%)
Andritz /1/ /2/ 3,917 329,157
MAN /2/ 14,082 595,349
Sumitomo Heavy Industries /2/ 138,774 560,443
1,484,949
MEDICAL INSTRUMENTS (0.93%)
Elekta /2/ /3/ 12,337 433,633
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL INSTRUMENTS (CONTINUED)
$
Topcon /1/ /2/ 13,803 242,632
676,265
MEDICAL PRODUCTS (1.36%)
Gambro /1/ /2/ 29,632 401,337
Nobel Biocare Holding /2/ 2,708 582,149
983,486
MEDICAL-BIOMEDICAL/GENE (0.17%)
Cambridge Antibody Technology
Group /2/ /3/ 11,718 125,501
MEDICAL-DRUGS (1.35%)
Fujirebio /2/ 11,168 182,873
Hisamitsu Pharmaceutical /1/ /2/ 7,237 193,188
Rohto Pharmaceutical /2/ 12,419 156,976
Santen Pharmaceutical /2/ 20,018 446,479
979,516
MEDICAL-HOSPITALS (0.48%)
Capio /2/ /3/ 22,698 352,001
MEDICAL-NURSING HOMES (0.37%)
Extendicare /3/ 20,001 267,434
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.72%)
Celesio /1/ /2/ 6,550 523,005
METAL PROCESSORS & FABRICATION (0.45%)
CFF Recycling /2/ 5,669 176,257
Tocalo /2/ 6,992 151,171
327,428
MISCELLANEOUS MANUFACTURERS (0.62%)
Amano /1/ /2/ 28,638 313,783
Balda /1/ /2/ 13,739 134,747
448,530
MORTGAGE BANKS (1.72%)
Home Capital Group /3/ 13,997 389,924
Hypo Real Estate Holding /2/ /3/ 20,584 855,758
1,245,682
MULTI-LINE INSURANCE (1.00%)
Baloise Holding /1/ /2/ 7,740 397,942
Codan /2/ 6,808 327,113
725,055
MULTIMEDIA (0.96%)
APN News & Media /1/ /2/ 61,913 232,451
Impresa /2/ /3/ 23,956 170,308
Promotora de Informaciones /2/ 15,252 291,824
694,583
NON-HOTEL GAMBLING (0.70%)
Paddy Power 28,794 504,512
OFFICE AUTOMATION & EQUIPMENT (0.53%)
Neopost /2/ 4,554 382,924
OIL & GAS DRILLING (0.38%)
AOC Holdings 19,157 273,345
OIL COMPANY-EXPLORATION & PRODUCTION (0.75%)
Tullow Oil /2/ 176,524 542,379
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL-FIELD SERVICES (1.65%)
$
Fred. Olsen Energy /2/ /3/ 12,975 247,096
Ocean Rig /2/ /3/ 30,659 175,545
Stolt Offshore /2/ /3/ 66,038 488,136
TGS-NOPEC Geophysical /2/ /3/ 10,538 285,696
1,196,473
PROPERTY & CASUALTY INSURANCE (1.30%)
Dongbu Insurance /2/ 23,680 190,347
Northbridge Financial 10,569 242,128
Promina Group /2/ 127,385 510,993
943,468
PROPERTY TRUST (0.73%)
Commonwealth Property Office Fund
/2/ 536,981 531,381
PUBLIC THOROUGHFARES (0.24%)
Autostrada Torino /2/ 8,473 173,713
PUBLISHING-BOOKS (0.39%)
Yell Group /2/ 36,536 281,484
PUBLISHING-NEWSPAPERS (0.16%)
Spir Communication /2/ 592 119,509
QUARRYING (0.54%)
Eramet /2/ 4,156 391,481
RACETRACKS (0.21%)
Snai /1/ /2/ /3/ 11,942 149,433
REAL ESTATE MANAGEMENT & SERVICES (2.76%)
AEON Mall /2/ 5 189
Castellum /2/ 6,788 251,515
Corio /1/ /2/ 13,745 738,148
Creed /1/ 139 362,145
Midland Realty Holdings /2/ 919,848 580,321
Pierre & Vacances /2/ 672 67,283
1,999,601
REAL ESTATE OPERATOR & DEVELOPER (4.21%)
Capital & Regional /2/ 20,244 271,370
Fadesa Inmobiliaria /2/ /3/ 32,927 748,469
Hammerson /2/ 20,996 341,639
Inmobiliaria Colonial /2/ 16,403 850,684
Inmobiliaria Urbis /2/ 23,487 359,971
JOINT /1/ /2/ 5,427 139,818
Kerry Properties /2/ 155,324 339,895
3,051,846
RENTAL-AUTO & EQUIPMENT (0.40%)
Northgate /2/ 18,684 293,071
RETAIL-APPAREL & SHOE (0.53%)
Aoki International /1/ /2/ 10,880 139,120
POINT /1/ /2/ 6,360 243,156
382,276
RETAIL-BUILDING PRODUCTS (0.93%)
Grafton Group /2/ 60,096 675,789
RETAIL-CONSUMER ELECTRONICS (0.74%)
Carphone Warehouse /2/ 189,207 536,984
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-DRUG STORE (0.56%)
$
Sundrug /2/ 6,351 239,436
Tsuruha /2/ 5,152 170,639
410,075
RETAIL-MAJOR DEPARTMENT STORE (0.30%)
David Jones /1/ /2/ 157,703 216,589
RETAIL-MISCELLANEOUS/DIVERSIFIED (0.83%)
Ryohin Keikaku /2/ 12,038 605,838
RETAIL-OFFICE SUPPLIES (0.08%)
Bechtle /2/ 2,683 58,885
RETAIL-PUBS (1.14%)
Punch Taverns /2/ 68,242 828,880
RETAIL-VIDEO RENTAL (0.26%)
GEO 67 188,685
RUBBER & PLASTIC PRODUCTS (0.12%)
Semperit Holding /2/ 2,954 86,482
RUBBER-TIRES (1.30%)
Continental /2/ 12,687 939,861
SOAP & CLEANING PRODUCTS (0.33%)
McBride /2/ 85,175 240,970
SPECIAL PURPOSE BANKS (0.17%)
IKB Deutsche Industriebank /2/ 4,539 121,745
STEEL PIPE & TUBE (0.23%)
Vallourec /2/ 790 166,722
STEEL PRODUCERS (3.38%)
Corus Group /2/ /3/ 715,053 591,437
Dongkuk Steel Mill /2/ 12,488 179,096
Gerdau AmeriSteel /3/ 47,149 234,815
INI Steel /2/ 22,120 349,778
IPSCO 15,597 745,703
Russel Metals /3/ 30,331 350,452
2,451,281
TELECOMMUNICATION EQUIPMENT (0.35%)
Option /1/ /2/ /3/ 8,284 251,006
TELEVISION (1.96%)
Antena 3 de Television /1/ /2/ 19,752 388,415
CanWest Global Communications /3/ 42,973 470,496
Modern Times Group /2/ /3/ 18,087 560,290
1,419,201
TOOLS-HAND HELD (0.59%)
Makita /1/ /2/ 22,582 426,273
TRANSPORT-MARINE (2.01%)
Dampskibsselskabet Torm /1/ /2/ 8,650 435,757
Kawasaki Kisen Kaisha /2/ 69,326 451,197
Orient Overseas International /2/ 92,968 449,675
Wilhelmsen /2/ 4,920 118,062
1,454,691
TRANSPORT-SERVICES (1.21%)
Arriva /2/ 34,350 331,505
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TRANSPORT-SERVICES (CONTINUED)
$
Toll Holdings /1/ /2/ 54,933 545,920
877,425
TRAVEL SERVICES (0.34%)
H.I.S. /2/ 10,646 243,772
WATER (2.50%)
Kelda Group /2/ 84,025 1,016,667
Pennon Group /2/ 42,215 792,820
1,809,487
TOTAL COMMON STOCKS 70,765,170
Principal
Amount Value
- ------------------------------------------------------------------------------------------
COMMERCIAL PAPER (1.79%)
ASSET BACKED SECURITIES (1.79%)
CAFCO
$ $
2.94%; 05/02/05 1,295,000 1,294,788
TOTAL COMMERCIAL PAPER 1,294,788
Maturity
Amount Value
------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (15.93%)
Merrill Lynch; 3.00%; dated
04/29/05 maturing 05/02/05
(collateralized by U.S.
Government Agency Securities;
$11,819,115; 11/01/05 -
04/01/35) /4/ $11,556,257 $ 11,553,368
TOTAL REPURCHASE AGREEMENTS 11,553,368
------------
TOTAL PORTFOLIO INVESTMENTS (115.32%) 83,613,326
LIABILITIES, NET OF
CASH, RECEIVABLES
AND OTHER ASSETS
(-15.32%) (11,109,015)
TOTAL NET ASSETS (100.00%) $ 72,504,311
---------------
/1 /Security or a portion of the security was on loan at the end of the period.
/2 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of these
securities totaled $64,390,471 or 88.81% of net assets.
/3 /Non-income producing security.
/4 /Security was purchased with the cash proceeds from securities loans.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $13,058,306
Unrealized Depreciation (1,181,931)
-----------
Net Unrealized Appreciation (Depreciation) 11,876,375
Cost for federal income tax purposes $71,736,951
INVESTMENTS BY COUNTRY (UNAUDITED)
Country Value Percentage of
Total Value
- ---------------------------------------------------------------
$
Australia 4,445,469 5.32%
Austria 415,639 0.50
Belgium 1,508,652 1.80
Bermuda 650,215 0.78
Canada 4,066,973 4.86
Cayman Islands 294,919 0.35
Denmark 2,101,260 2.51
Finland 122,346 0.15
France 3,522,352 4.21
Germany 4,847,639 5.80
Greece 926,880 1.11
Hong Kong 1,017,701 1.22
Ireland 2,144,245 2.57
Italy 2,260,932 2.70
Japan 15,245,403 18.23
Korea 1,268,817 1.52
Luxembourg 488,136 0.58
Netherlands 2,072,260 2.48
Norway 1,335,233 1.60
Portugal 170,307 0.20
Singapore 235,319 0.28
Spain 4,054,509 4.85
Sweden 2,618,683 3.13
Switzerland 2,064,915 2.47
United Kingdom 12,886,365 15.41
United States 12,848,157 15.37
TOTAL $83,613,326 100.00%
------------- ---------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
113
SCHEDULE OF INVESTMENTS
PRINCIPAL LARGECAP STOCK INDEX FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- -------------------------------------------------------------------------------------
COMMON STOCKS (98.23%)
ADVERTISING AGENCIES (0.19%)
$
Interpublic Group /1/ 2,679 34,452
Omnicom Group 1,179 97,739
132,191
AEROSPACE & DEFENSE (0.87%)
Boeing 5,273 313,849
Northrop Grumman 2,282 125,145
Raytheon 2,870 107,941
Rockwell Collins 1,130 51,844
598,779
AEROSPACE & DEFENSE EQUIPMENT (0.94%)
General Dynamics 1,267 133,098
Goodrich 760 30,628
Lockheed Martin 2,543 154,996
United Technologies 3,244 329,980
648,702
AGRICULTURAL OPERATIONS (0.14%)
Monsanto 1,686 98,833
AIRLINES (0.10%)
Delta Air Lines /1/ /2/ 885 2,912
Southwest Airlines 4,667 69,445
72,357
APPAREL MANUFACTURERS (0.21%)
Coach /1/ 2,422 64,910
Jones Apparel Group 775 23,599
Liz Claiborne 687 24,340
VF 633 35,821
148,670
APPLIANCES (0.04%)
Maytag /2/ 504 4,884
Whirlpool 423 26,251
31,135
APPLICATIONS SOFTWARE (2.56%)
Citrix Systems /1/ 1,074 24,165
Compuware /1/ 2,454 14,601
Intuit /1/ 1,174 47,312
Mercury Interactive /1/ 535 22,112
Microsoft 64,103 1,621,806
Parametric Technology /1/ 1,713 9,113
Siebel Systems /1/ 3,261 29,349
1,768,458
ATHLETIC FOOTWEAR (0.18%)
Nike 1,455 111,758
Reebok International 355 14,417
126,175
AUTO-CARS & LIGHT TRUCKS (0.29%)
Ford Motor 11,598 105,658
General Motors /2/ 3,577 95,434
201,092
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.13%)
Navistar International /1/ 416 12,284
Paccar 1,100 74,690
86,974
Shares
Held Value
- -----------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.04%)
$
Dana 951 10,860
Delphi Automotive Systems 3,555 11,732
Visteon 821 2,873
25,465
BEVERAGES-NON-ALCOHOLIC (1.87%)
Coca-Cola 14,352 623,451
Coca-Cola Enterprises 2,234 45,350
Pepsi Bottling Group 1,252 35,895
Pepsico 10,631 591,509
1,296,205
BEVERAGES-WINE & SPIRITS (0.05%)
Brown-Forman 571 31,691
BREWERY (0.38%)
Anheuser-Busch 4,921 230,647
Molson Coors Brewing 509 31,431
262,078
BROADCASTING SERVICES & PROGRAMMING (0.15%)
Clear Channel Communications 3,338 106,616
BUILDING & CONSTRUCTION PRODUCTS-
MISCELLANEOUS (0.18%)
Masco 2,837 89,337
Vulcan Materials 651 34,529
123,866
BUILDING PRODUCTS-AIR & HEATING (0.07%)
American Standard 1,141 51,014
BUILDING-MAINTENANCE & SERVICE (0.07%)
Ecolab 1,398 45,729
BUILDING-RESIDENTIAL & COMMERCIAL (0.19%)
Centex 802 46,291
KB Home 528 30,096
Pulte Homes 750 53,588
129,975
CABLE TV (0.65%)
Comcast /1/ 14,014 449,990
CASINO HOTELS (0.07%)
Harrah's Entertainment 721 47,312
CASINO SERVICES (0.08%)
International Game Technology 2,186 58,782
CELLULAR TELECOMMUNICATIONS (0.29%)
Nextel Communications /1/ 7,138 199,793
CHEMICALS-DIVERSIFIED (1.02%)
Dow Chemical 6,040 277,417
E. I. Du Pont de Nemours 6,316 297,547
PPG Industries 1,097 74,102
Rohm & Haas 1,231 53,746
702,812
CHEMICALS-SPECIALTY (0.14%)
Eastman Chemical 493 26,622
Engelhard 774 23,708
Great Lakes Chemical 326 10,119
Hercules /1/ 708 9,367
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
CHEMICALS-SPECIALTY (CONTINUED)
$
Sigma-Aldrich 436 25,475
95,291
CIRCUIT BOARDS (0.05%)
Jabil Circuit /1/ 1,162 32,071
COATINGS & PAINT (0.05%)
Sherwin-Williams 802 35,745
COMMERCIAL BANKS (0.95%)
AmSouth Bancorp 2,249 59,194
BB&T 3,474 136,215
Compass Bancshares 782 33,642
First Horizon National 779 32,352
M&T Bank 623 64,449
Marshall & Ilsley 1,315 56,072
North Fork Bancorp 2,981 83,915
Regions Financial 2,943 98,561
Synovus Financial 1,969 55,191
Zions Bancorp 569 39,847
659,438
COMMERCIAL SERVICE-FINANCE (0.32%)
Equifax 855 28,771
H&R Block 1,046 52,101
Moody's 869 71,379
Paychex 2,253 68,942
221,193
COMMERCIAL SERVICES (0.02%)
Convergys /1/ 900 11,664
COMPUTER AIDED DESIGN (0.07%)
Autodesk 1,453 46,249
COMPUTER SERVICES (0.33%)
Affiliated Computer Services /1/ 802 38,231
Computer Sciences /1/ 1,211 52,654
Electronic Data Systems 3,279 63,449
Sungard Data Systems /1/ 1,829 61,089
Unisys /1/ 2,136 13,863
229,286
COMPUTERS (2.08%)
Apple Computer /1/ 5,176 186,647
Gateway /1/ 1,893 6,455
Hewlett-Packard 18,344 375,502
International Business Machines 10,343 789,998
Sun Microsystems /1/ 21,399 77,678
1,436,280
COMPUTERS-INTEGRATED SYSTEMS (0.84%)
Dell /1/ 15,577 542,547
NCR /1/ 1,179 38,907
581,454
COMPUTERS-MEMORY DEVICES (0.38%)
EMC /1/ 15,238 199,923
Network Appliance /1/ 2,319 61,755
261,678
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMPUTERS-PERIPHERAL EQUIPMENT (0.08%)
$
Lexmark International /1/ 802 55,699
CONSUMER PRODUCTS-MISCELLANEOUS (0.20%)
Clorox 972 61,527
Fortune Brands 917 77,560
139,087
CONTAINERS-METAL & GLASS (0.04%)
Ball 696 27,492
CONTAINERS-PAPER & PLASTIC (0.09%)
Bemis 677 18,658
Pactiv /1/ 940 20,153
Sealed Air /1/ 529 25,625
64,436
COSMETICS & TOILETRIES (2.47%)
Alberto-Culver 537 23,896
Avon Products 2,987 119,719
Colgate-Palmolive 3,329 165,751
Gillette 6,280 324,299
International Flavors &
Fragrances 561 21,262
Kimberly-Clark 3,048 190,348
Procter & Gamble 15,980 865,317
1,710,592
CRUISE LINES (0.24%)
Carnival 3,337 163,113
DATA PROCESSING & MANAGEMENT (0.67%)
Automatic Data Processing 3,694 160,467
First Data 5,081 193,231
Fiserv /1/ 1,224 51,775
VERITAS Software /1/ 2,674 55,058
460,531
DISPOSABLE MEDICAL PRODUCTS (0.07%)
C.R. Bard 663 47,186
DISTRIBUTION-WHOLESALE (0.11%)
Genuine Parts 1,107 47,490
W.W. Grainger 528 29,193
76,683
DIVERSIFIED MANUFACTURING OPERATIONS (5.67%)
3M 4,893 374,168
Cooper Industries 586 37,305
Danaher 1,743 88,248
Dover 1,290 46,904
Eaton 968 56,822
General Electric /3/ 67,147 2,430,721
Honeywell International 5,390 192,746
Illinois Tool Works 1,740 145,847
ITT Industries 584 52,829
Leggett & Platt 1,209 32,595
Textron 856 64,499
Tyco International 12,753 399,296
3,921,980
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (0.19%)
Cendant 6,684 133,078
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DRUG DELIVERY SYSTEMS (0.05%)
$
Hospira /1/ 988 33,147
E-COMMERCE-SERVICES (0.38%)
eBay /1/ 7,667 243,274
Monster Worldwide /1/ 764 17,580
260,854
ELECTRIC PRODUCTS-MISCELLANEOUS (0.28%)
Emerson Electric 2,656 166,452
Molex 1,062 26,985
193,437
ELECTRIC-GENERATION (0.10%)
AES /1/ 4,110 66,089
ELECTRIC-INTEGRATED (2.98%)
Allegheny Energy /1/ /2/ 1,027 25,100
Ameren 1,237 63,953
American Electric Power 2,429 85,549
CenterPoint Energy 1,832 21,691
Cinergy 1,213 48,035
CMS Energy /1/ 1,365 17,636
Consolidated Edison 1,536 66,478
Constellation Energy Group 1,120 58,867
Dominion Resources 2,157 162,638
DTE Energy 1,102 50,637
Duke Energy 5,941 173,418
Edison International 2,063 74,887
Entergy 1,349 98,882
Exelon 4,212 208,494
FirstEnergy 2,089 90,913
FPL Group 2,478 101,152
NiSource 1,718 39,926
PG&E 2,285 79,335
Pinnacle West Capital 614 25,727
PPL 1,198 65,003
Progress Energy 1,565 65,714
Public Service Enterprise Group 1,510 87,731
Southern 4,706 155,063
TECO Energy 1,308 21,726
TXU 1,521 130,486
Xcel Energy 2,539 43,620
2,062,661
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.05%)
Sanmina /1/ 3,315 13,293
Solectron /1/ 6,151 20,298
33,591
ELECTRONIC COMPONENTS-SEMICONDUCTOR (2.31%)
Advanced Micro Devices /1/ 2,495 35,504
Altera /1/ 2,359 48,902
Applied Micro Circuits /1/ 1,952 5,212
Broadcom /1/ 1,842 55,094
Freescale Semiconductor /1/ 2,543 47,961
Intel 39,448 927,817
LSI Logic /1/ 2,438 13,068
Micron Technology /1/ 3,888 37,752
National Semiconductor 2,251 42,949
Nvidia /1/ 1,052 23,081
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC COMPONENTS-SEMICONDUCTOR (CONTINUED)
$
PMC - Sierra /1/ 1,139 9,180
QLogic /1/ 581 19,312
Texas Instruments 10,904 272,164
Xilinx 2,207 59,457
1,597,453
ELECTRONIC FORMS (0.13%)
Adobe Systems 1,541 91,643
ELECTRONIC MEASUREMENT INSTRUMENTS (0.10%)
Agilent Technologies /1/ 2,737 56,793
Tektronix 566 12,259
69,052
ELECTRONICS-MILITARY (0.07%)
L-3 Communications Holdings 729 51,737
ENGINEERING-RESEARCH & DEVELOPMENT
SERVICES (0.04%)
Fluor 541 27,894
ENGINES-INTERNAL COMBUSTION (0.03%)
Cummins Engine 270 18,360
ENTERPRISE SOFTWARE & SERVICE (0.66%)
BMC Software /1/ 1,403 22,728
Computer Associates International 3,371 90,680
Novell /1/ /2/ 2,400 14,184
Oracle /1/ 28,466 329,067
456,659
ENTERTAINMENT SOFTWARE (0.15%)
Electronic Arts /1/ 1,951 104,164
FIDUCIARY BANKS (0.53%)
Bank of New York 4,931 137,772
Mellon Financial 2,684 74,320
Northern Trust 1,288 57,999
State Street 2,113 97,684
367,775
FILTRATION & SEPARATION PRODUCTS (0.03%)
Pall 785 21,062
FINANCE-COMMERCIAL (0.08%)
CIT Group 1,335 53,774
FINANCE-CONSUMER LOANS (0.19%)
SLM 2,723 129,724
FINANCE-CREDIT CARD (1.00%)
American Express 7,431 391,614
Capital One Financial 1,565 110,943
MBNA 8,093 159,837
Providian Financial /1/ 1,856 30,939
693,333
FINANCE-INVESTMENT BANKER & BROKER (4.16%)
Bear Stearns 717 67,871
Charles Schwab 7,272 75,265
Citigroup 33,103 1,554,517
E*Trade Financial /1/ 2,348 26,086
Goldman Sachs Group 2,836 302,857
Lehman Brothers Holdings 1,749 160,418
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-INVESTMENT BANKER & BROKER (CONTINUED)
$
Merrill Lynch 5,897 318,025
Morgan Stanley 7,048 370,866
2,875,905
FINANCE-MORTGAGE LOAN/BANKER (1.06%)
Countrywide Financial 3,676 133,035
Federal Home Loan Mortgage 4,358 268,104
Federal National Mortgage
Association 6,132 330,821
731,960
FINANCIAL GUARANTEE INSURANCE (0.19%)
Ambac Financial Group 688 45,993
MBIA 891 46,670
MGIC Investment 612 36,108
128,771
FOOD-CONFECTIONERY (0.25%)
Hershey 1,385 88,502
Wm. Wrigley Jr. 1,239 85,652
174,154
FOOD-FLOUR & GRAIN (0.10%)
Archer Daniels Midland 3,947 71,007
FOOD-MISCELLANEOUS/DIVERSIFIED (0.84%)
Campbell Soup 2,062 61,324
ConAgra Foods 3,266 87,366
General Mills 2,312 114,213
H.J. Heinz 2,217 81,696
Kellogg 2,223 99,924
McCormick 860 29,747
Sara Lee 5,000 106,950
581,220
FOOD-RETAIL (0.26%)
Albertson's /2/ 2,331 46,131
Kroger /1/ 4,638 73,141
Safeway /1/ 2,834 60,336
179,608
FOOD-WHOLESALE & DISTRIBUTION (0.24%)
Supervalu 855 26,984
Sysco 4,035 139,611
166,595
FORESTRY (0.06%)
Plum Creek Timber 1,164 40,205
GAS-DISTRIBUTION (0.17%)
KeySpan 1,018 38,613
Nicor 279 10,314
Peoples Energy 239 9,464
Sempra Energy 1,507 60,853
119,244
GOLD MINING (0.15%)
Newmont Mining 2,812 106,772
HEALTH CARE COST CONTAINMENT (0.10%)
McKesson 1,870 69,190
HOME DECORATION PRODUCTS (0.05%)
Newell Rubbermaid 1,741 37,832
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
HOTELS & MOTELS (0.30%)
$
Hilton Hotels 2,437 53,200
Marriott International 1,273 79,881
Starwood Hotels & Resorts
Worldwide 1,346 73,141
206,222
HUMAN RESOURCES (0.04%)
Robert Half International 1,019 25,292
IDENTIFICATION SYSTEM-DEVELOPMENT (0.03%)
Symbol Technologies 1,537 20,550
INDEPENDENT POWER PRODUCER (0.01%)
Calpine /1/ /2/ 3,384 6,057
INDUSTRIAL AUTOMATION & ROBOTS (0.07%)
Rockwell Automation 1,108 51,223
INDUSTRIAL GASES (0.26%)
Air Products & Chemicals 1,442 84,689
Praxair 2,044 95,720
180,409
INSTRUMENTS-CONTROLS (0.20%)
Johnson Controls 1,211 66,448
Parker Hannifin 761 45,614
Thermo Electron /1/ 1,012 25,280
137,342
INSTRUMENTS-SCIENTIFIC (0.19%)
Applied Biosystems Group 1,244 26,373
Fisher Scientific International
/1/ 742 44,060
Millipore /1/ 314 15,141
PerkinElmer 820 15,170
Waters /1/ 765 30,317
131,061
INSURANCE BROKERS (0.20%)
Aon 2,004 41,783
Marsh & McLennan 3,350 93,901
135,684
INTERNET SECURITY (0.12%)
Symantec /1/ 4,494 84,397
INVESTMENT MANAGEMENT & ADVISORY
SERVICES (0.24%)
Federated Investors 603 17,155
Franklin Resources 1,252 85,988
Janus Capital Group 1,496 19,433
T. Rowe Price Group 784 43,253
165,829
LEISURE & RECREATION PRODUCTS (0.04%)
Brunswick 613 25,746
LIFE & HEALTH INSURANCE (0.53%)
Aflac 3,179 129,226
Jefferson-Pilot 865 43,432
Lincoln National 1,104 49,647
Principal Financial Group /4/ 1,897 74,135
Torchmark 684 36,546
UnumProvident 1,885 31,517
364,503
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
LINEN SUPPLY & RELATED ITEMS (0.05%)
$
Cintas 946 36,506
MACHINERY-CONSTRUCTION & MINING (0.28%)
Caterpillar 2,172 191,245
MACHINERY-FARM (0.14%)
Deere 1,563 97,750
MACHINERY-GENERAL INDUSTRY (0.12%)
Ingersoll-Rand 1,098 84,403
MEDICAL INFORMATION SYSTEM (0.05%)
IMS Health 1,469 35,227
MEDICAL INSTRUMENTS (1.23%)
Biomet 1,600 61,904
Boston Scientific /1/ 4,815 142,428
Guidant 2,043 151,345
Medtronic 7,662 403,787
St. Jude Medical /1/ 2,286 89,223
848,687
MEDICAL LABORATORY & TESTING SERVICE (0.15%)
Laboratory Corp. of America
Holdings /1/ 855 42,322
Quest Diagnostics 577 61,047
103,369
MEDICAL PRODUCTS (2.57%)
Baxter International 3,925 145,617
Becton Dickinson 1,602 93,749
Johnson & Johnson 18,839 1,292,921
Stryker 2,373 115,209
Zimmer Holdings /1/ 1,562 127,178
1,774,674
MEDICAL-BIOMEDICAL/GENE (0.96%)
Amgen /1/ 7,936 461,955
Biogen Idec /1/ 2,113 76,575
Chiron /1/ 935 31,930
Genzyme /1/ 1,570 92,018
662,478
MEDICAL-DRUGS (5.43%)
Abbott Laboratories 9,875 485,455
Allergan 833 58,635
Bristol-Myers Squibb 12,379 321,854
Eli Lilly 7,176 419,581
Forest Laboratories /1/ 2,225 79,388
King Pharmaceuticals /1/ 1,530 12,240
Medimmune /1/ 1,575 39,958
Merck 13,988 474,193
Pfizer 47,264 1,284,163
Schering-Plough 9,343 194,988
Wyeth 8,463 380,327
3,750,782
MEDICAL-GENERIC DRUGS (0.07%)
Mylan Laboratories /2/ 1,705 28,132
Watson Pharmaceutical /1/ 693 20,790
48,922
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-HMO (1.16%)
$
Aetna 1,864 136,762
Humana /1/ 1,018 35,274
UnitedHealth Group 4,063 383,994
WellPoint /1/ 1,931 246,685
802,715
MEDICAL-HOSPITALS (0.32%)
HCA 2,607 145,575
Health Management Associates 1,546 38,232
Tenet Healthcare /1/ 2,966 35,503
219,310
MEDICAL-NURSING HOMES (0.03%)
Manor Care 545 18,176
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.28%)
AmerisourceBergen 668 40,935
Cardinal Health 2,746 152,595
193,530
METAL-ALUMINUM (0.23%)
Alcoa 5,521 160,219
METAL-COPPER (0.08%)
Phelps Dodge 612 52,540
METAL-DIVERSIFIED (0.06%)
Freeport-McMoran Copper & Gold 1,134 39,304
MISCELLANEOUS INVESTING (0.51%)
Apartment Investment & Management 606 23,101
Archstone-Smith Trust 1,265 45,502
Equity Office Properties Trust 2,554 80,374
Equity Residential Properties
Trust 1,791 61,521
Prologis Trust 1,165 46,122
Simon Property Group 1,401 92,564
349,184
MONEY CENTER BANKS (2.83%)
Bank of America 25,680 1,156,627
JP Morgan Chase 22,513 798,987
1,955,614
MOTORCYCLE & MOTOR SCOOTER (0.13%)
Harley-Davidson 1,850 86,987
MULTI-LINE INSURANCE (2.72%)
Allstate 4,303 241,656
American International Group 16,500 839,025
Cigna 833 76,619
Cincinnati Financial 1,056 42,506
Hartford Financial Services Group 1,873 135,549
Loews 1,011 71,660
MetLife 4,643 180,613
Prudential Financial 3,319 189,681
Safeco 806 42,452
XL Capital 880 61,864
1,881,625
MULTIMEDIA (2.49%)
Gannett 1,590 122,430
McGraw-Hill 1,206 105,019
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MULTIMEDIA (CONTINUED)
$
Meredith 288 13,536
News 18,155 277,408
Time Warner /1/ 29,115 489,423
Viacom 10,801 373,931
Walt Disney 12,970 342,408
1,724,155
NETWORKING PRODUCTS (1.12%)
Cisco Systems /1/ 40,950 707,616
Lucent Technologies /1/ 28,071 68,213
775,829
NON-HAZARDOUS WASTE DISPOSAL (0.17%)
Allied Waste Industries /1/ 1,719 13,735
Waste Management 3,601 102,592
116,327
OFFICE AUTOMATION & EQUIPMENT (0.21%)
Pitney Bowes 1,462 65,381
Xerox /1/ 6,065 80,361
145,742
OFFICE SUPPLIES & FORMS (0.05%)
Avery Dennison 643 33,661
OIL & GAS DRILLING (0.30%)
Nabors Industries /1/ 897 48,321
Noble 858 43,672
Rowan 679 18,014
Transocean /1/ 2,034 94,317
204,324
OIL COMPANY-EXPLORATION & PRODUCTION (1.01%)
Anadarko Petroleum 1,501 109,633
Apache 2,068 116,408
Burlington Resources 2,451 119,143
Devon Energy 3,036 137,136
EOG Resources 1,514 71,991
Kerr-McGee 1,034 80,238
XTO Energy 2,200 66,374
700,923
OIL COMPANY-INTEGRATED (5.62%)
Amerada Hess 539 50,477
ChevronTexaco 13,331 693,212
ConocoPhillips 4,408 462,179
Exxon Mobil 40,451 2,306,920
Marathon Oil 2,198 102,361
Occidental Petroleum 2,516 173,604
Unocal 1,714 93,499
3,882,252
OIL FIELD MACHINERY & EQUIPMENT (0.06%)
National-Oilwell Varco /1/ 1,063 42,244
OIL REFINING & MARKETING (0.26%)
Ashland 420 28,241
Sunoco 438 43,476
Valero Energy 1,625 111,361
183,078
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL-FIELD SERVICES (0.77%)
$
Baker Hughes 2,142 94,505
BJ Services 1,029 50,164
Halliburton 3,196 132,922
Schlumberger 3,735 255,511
533,102
OPTICAL SUPPLIES (0.04%)
Bausch & Lomb 339 25,425
PAPER & RELATED PRODUCTS (0.50%)
Georgia-Pacific 1,646 56,408
International Paper 3,105 106,471
Louisiana-Pacific 702 17,269
MeadWestvaco 1,283 37,784
Temple-Inland 724 24,435
Weyerhaeuser 1,537 105,454
347,821
PHARMACY SERVICES (0.36%)
Caremark Rx /1/ 2,895 115,945
Express Scripts /1/ 481 43,117
Medco Health Solutions /1/ 1,744 88,891
247,953
PHOTO EQUIPMENT & SUPPLIES (0.07%)
Eastman Kodak 1,816 45,400
PIPELINES (0.23%)
Dynegy /1/ 2,097 7,025
El Paso 4,075 40,709
Kinder Morgan 695 53,140
Williams 3,612 61,476
162,350
POWER CONVERTER & SUPPLY EQUIPMENT (0.04%)
American Power Conversion 1,139 27,632
PRINTING-COMMERCIAL (0.06%)
R.R. Donnelley & Sons 1,364 44,889
PROPERTY & CASUALTY INSURANCE (0.64%)
ACE 1,800 77,328
Chubb 1,213 99,199
Progressive 1,268 115,730
St. Paul 4,241 151,828
444,085
PUBLICLY TRADED INVESTMENT FUND (1.08%)
iShares S&P 500 Index Fund 6,430 744,401
PUBLISHING-NEWSPAPERS (0.22%)
Dow Jones 446 14,914
Knight Ridder 477 30,862
New York Times 923 30,791
Tribune 1,889 72,916
149,483
REGIONAL BANKS (3.17%)
Comerica 1,078 61,726
Fifth Third Bancorp 3,295 143,332
Huntington Bancshares 1,468 34,513
KeyCorp 2,573 85,321
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
REGIONAL BANKS (CONTINUED)
$
National City 3,764 127,825
PNC Financial Services Group 1,790 95,282
SunTrust Banks 2,149 156,512
U.S. Bancorp 11,741 327,574
Wachovia 10,044 514,052
Wells Fargo 10,743 643,935
2,190,072
RETAIL-APPAREL & SHOE (0.29%)
Gap 5,021 107,198
Limited 2,420 52,490
Nordstrom 798 40,562
200,250
RETAIL-AUTO PARTS (0.05%)
Autozone /1/ 428 35,524
RETAIL-AUTOMOBILE (0.04%)
AutoNation /1/ 1,430 26,126
RETAIL-BEDDING (0.10%)
Bed Bath & Beyond /1/ 1,917 71,332
RETAIL-BUILDING PRODUCTS (1.08%)
Home Depot 13,911 492,032
Lowe's 4,895 255,079
747,111
RETAIL-CONSUMER ELECTRONICS (0.20%)
Best Buy 1,890 95,142
Circuit City Stores 1,212 19,150
RadioShack 1,004 25,070
139,362
RETAIL-DISCOUNT (2.23%)
Big Lots /1/ 714 7,268
Costco Wholesale 2,992 121,415
Dollar General 1,909 38,848
Family Dollar Stores 1,062 28,653
Target 5,672 263,181
TJX 3,052 69,128
Wal-Mart Stores 21,463 1,011,766
1,540,259
RETAIL-DRUG STORE (0.59%)
CVS 2,534 130,704
Walgreen 6,471 278,641
409,345
RETAIL-JEWELRY (0.04%)
Tiffany 921 27,768
RETAIL-MAJOR DEPARTMENT STORE (0.33%)
J.C. Penney 1,713 81,213
May Department Stores 1,850 64,898
Sears Holdings /1/ 608 82,226
228,337
RETAIL-OFFICE SUPPLIES (0.21%)
Office Depot /1/ 1,981 38,788
OfficeMax 592 19,228
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-OFFICE SUPPLIES (CONTINUED)
$
Staples 4,705 89,724
147,740
RETAIL-REGIONAL DEPARTMENT STORE (0.25%)
Dillard's 447 10,402
Federated Department Stores 1,072 61,640
Kohl's /1/ 2,064 98,246
170,288
RETAIL-RESTAURANTS (0.73%)
Darden Restaurants 936 28,080
McDonald's 8,058 236,180
Starbucks /1/ 2,531 125,335
Wendy's International 721 30,953
Yum! Brands 1,846 86,688
507,236
RETAIL-TOY STORE (0.05%)
Toys R Us /1/ 1,362 34,527
RUBBER-TIRES (0.03%)
Cooper Tire & Rubber 444 7,748
Goodyear Tire & Rubber /1/ /2/ 1,113 13,211
20,959
SAVINGS & LOANS-THRIFTS (0.56%)
Golden West Financial 1,788 111,446
Sovereign Bancorp 2,374 48,833
Washington Mutual 5,531 228,541
388,820
SCHOOLS (0.11%)
Apollo Group /1/ 1,049 75,654
SEMICONDUCTOR COMPONENT-INTEGRATED
CIRCUITS (0.33%)
Analog Devices 2,359 80,465
Linear Technology 1,945 69,514
Maxim Integrated Products 2,069 77,381
227,360
SEMICONDUCTOR EQUIPMENT (0.35%)
Applied Materials /1/ 10,565 157,101
Kla-Tencor /1/ 1,245 48,580
Novellus Systems /1/ 885 20,736
Teradyne /1/ 1,230 13,555
239,972
STEEL PRODUCERS (0.12%)
Nucor 1,011 51,662
United States Steel 723 30,916
82,578
STEEL-SPECIALTY (0.02%)
Allegheny Technologies 567 12,701
TELECOMMUNICATION EQUIPMENT (0.68%)
ADC Telecommunications /1/ 5,136 11,659
Andrew /1/ 1,019 12,503
Comverse Technology /1/ 1,251 28,510
Qualcomm 10,426 363,763
Scientific-Atlanta 963 29,449
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TELECOMMUNICATION EQUIPMENT (CONTINUED)
$
Tellabs /1/ 2,927 22,713
468,597
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.21%)
CIENA /1/ 3,625 8,338
Corning /1/ 8,931 122,801
JDS Uniphase /1/ 9,152 13,545
144,684
TELECOMMUNICATION SERVICES (0.04%)
Avaya /1/ 3,040 26,387
TELEPHONE-INTEGRATED (2.80%)
ALLTEL 1,916 109,135
AT&T 5,070 96,989
BellSouth 11,602 307,337
CenturyTel 852 26,148
Citizens Communications 2,124 27,081
Qwest Communications
International /1/ /2/ 10,587 36,208
SBC Communications 20,928 498,086
Sprint 9,363 208,420
Verizon Communications 17,548 628,219
1,937,623
TELEVISION (0.07%)
Univision Communications /1/ 1,849 48,610
THERAPEUTICS (0.15%)
Gilead Sciences /1/ 2,742 101,728
TOBACCO (1.38%)
Altria Group 13,105 851,694
Reynolds American 738 57,542
UST 1,046 47,907
957,143
TOOLS-HAND HELD (0.11%)
Black & Decker 507 42,401
Snap-On 367 12,173
Stanley Works 475 20,439
75,013
TOYS (0.10%)
Hasbro 1,057 19,998
Mattel 2,639 47,634
67,632
TRANSPORT-RAIL (0.51%)
Burlington Northern Santa Fe 2,396 115,607
CSX 1,366 54,818
Norfolk Southern 2,535 79,599
Union Pacific 1,653 105,676
355,700
TRANSPORT-SERVICES (0.97%)
FedEx 1,909 162,169
United Parcel Service 7,090 505,588
667,757
TRAVEL SERVICES (0.02%)
Sabre Holdings 833 16,293
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TRUCKING & LEASING (0.02%)
$
Ryder System 405 14,957
WEB PORTALS (0.41%)
Yahoo /1/ 8,260 285,053
WIRELESS EQUIPMENT (0.34%)
Motorola 15,532 238,261
TOTAL COMMON STOCKS 67,907,189
Principal
Amount Value
- ------------------------------------------------------------------------------------------
COMMERCIAL PAPER (2.00%)
FINANCE-MORTGAGE LOAN/BANKER (2.00%)
Investment in Joint Trading
Account; Federal National
Mortgage Association
$ $
2.60%; 05/02/05 1,381,261 1,381,042
TOTAL COMMERCIAL PAPER 1,381,042
Principal
Amount Value
- ------------------------------------------------------------------------------------------
EPURCHASE AGREEMENTS (0.41%)
Goldman Sachs; 2.80%; dated
04/29/05 maturing 05/02/05
(collateralized by U.S.
Treasury; $287,642; 05/15/16)
/5/ $ 282,066 $ 282,000
TOTAL REPURCHASE AGREEMENTS 282,000
-----------
TOTAL PORTFOLIO INVESTMENTS (100.64%) 69,570,231
LIABILITIES, NET OF
CASH, RECEIVABLES
AND OTHER ASSETS
(-0.64%) (444,963)
TOTAL NET ASSETS (100.00%) $69,125,268
--------------
Contract Opening Current Unrealized
Type Commitment Market Value Market Value Gain(Loss)
Futures Contracts
5 S&P 500 Buy $1,512,150 $1,448,125 $(64,025)
June 2005
Futures
/1 /Non-income producing security.
/2 /Security or a portion of the security was on loan at the end of the period.
/3 /Security or a portion of the security was pledged to cover margin
requirements for futures contracts. At the end of the period, the value of
these securities totaled $543,000 or 0.79% of net assets.
/4 /Affiliated security.
/5 /Security was purchased with the cash proceeds from securities loans.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 11,488,752
Unrealized Depreciation (14,765,897)
------------
Net Unrealized Appreciation (Depreciation) (3,277,145)
Cost for federal income tax purposes $ 72,847,376
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
Consumer, %
Non-cyclical $15,093,749 21.25
Financial 13,199,170 18.59
Industrial 7,785,651 10.96
Technology 7,737,854 10.90
Communications 7,032,521 9.90
Consumer, Cyclical 6,111,206 8.60
Energy 5,680,032 8.00
Utilities 2,254,052 3.17
Government 1,979,967 2.79
Basic Materials 1,951,628 2.75
Futures Contracts 1,448,125 2.04
Funds 744,401 1.05
TOTAL $71,018,356 100.00%
---------------- ------------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL LIMITED TERM BOND FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (89.23%)
AEROSPACE & DEFENSE (0.31%)
Northrop Grumman
$ $
4.08%; 11/16/06 130,000 129,951
7.00%; 03/01/06 200,000 204,885
Raytheon
6.75%; 08/15/07 73,000 76,756
411,592
AEROSPACE & DEFENSE EQUIPMENT (0.23%)
General Dynamics
3.00%; 05/15/08 155,000 149,708
United Technologies
4.88%; 11/01/06 150,000 152,159
301,867
AGRICULTURAL OPERATIONS (0.12%)
Bunge Limited Finance
4.38%; 12/15/08 160,000 159,516
AIRLINES (0.10%)
Southwest Airlines
5.50%; 11/01/06 125,000 127,654
ASSET BACKED SECURITIES (2.28%)
Bear Stearns Asset Backed Securities
3.26%; 02/25/35 /1/ 325,000 325,160
3.62%; 03/25/34 /1/ 400,000 399,981
Chase Funding Mortgage Loan Asset Backed
Certificates
4.34%; 08/25/28 193,953 193,916
Countrywide Asset Backed Certificates
3.61%; 04/25/30 590,000 588,079
Financial Asset Securities Corp. AAA Trust
3.31%; 02/27/35 /1/ /2/ 275,000 275,019
Master Asset Backed Securities
Trust
3.59%; 03/25/35 /1/ /3/ 400,000 400,000
Residential Asset Mortgage Products
3.25%; 12/25/34 /1/ /3/ 325,000 325,503
Structured Asset Securities
3.24%; 03/25/35 /1/ 475,000 475,255
2,982,913
AUTO-CARS & LIGHT TRUCKS (0.93%)
DaimlerChrysler Holding
3.20%; 03/07/07 /1/ 325,000 321,776
3.47%; 05/24/06 /1/ 370,000 370,309
7.25%; 01/18/06 125,000 127,188
7.75%; 06/15/05 200,000 200,782
Nissan Motor Acceptance
4.63%; 03/08/10 /2/ 195,000 193,114
1,213,169
AUTOMOBILE SEQUENTIAL (5.11%)
BMW Vehicle Owner Trust
1.88%; 10/25/06 58,438 58,253
Capital Auto Receivables Asset Trust
3.58%; 10/16/06 696,800 697,269
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
AUTOMOBILE SEQUENTIAL (CONTINUED)
Capital Auto Receivables Asset
Trust (continued)
$ $
4.16%; 07/16/07 513,657 513,827
4.50%; 10/15/07 119,560 119,788
Chase Manhattan Auto Owner Trust
2.06%; 12/15/09 725,000 703,849
4.21%; 01/15/09 830,060 833,349
4.24%; 09/15/08 112,140 112,536
DaimlerChrysler Auto Trust
2.88%; 10/08/09 200,000 197,619
3.09%; 01/08/08 100,000 99,424
Ford Credit Auto Owner Trust
2.70%; 06/15/07 450,000 446,960
Honda Auto Receivables Owner Trust
2.70%; 03/17/08 475,000 470,762
4.49%; 09/17/07 370,524 371,603
M&I Auto Loan Trust
3.04%; 10/20/08 500,000 497,816
Nissan Auto Receivables Owner Trust
1.89%; 12/15/06 52,587 52,391
2.70%; 12/17/07 1,000,000 987,988
3.33%; 01/15/08 200,000 199,470
4.28%; 10/16/06 113,113 113,237
WFS Financial Owner Trust
5.18%; 03/20/09 201,201 201,700
6,677,841
BEVERAGES-NON-ALCOHOLIC (0.12%)
Coca-Cola Enterprises
5.25%; 05/15/07 150,000 153,380
BEVERAGES-WINE & SPIRITS (0.28%)
Diageo Capital
3.38%; 03/20/08 100,000 97,934
4.38%; 05/03/10 270,000 268,388
366,322
BROADCASTING SERVICES & PROGRAMMING (0.24%)
Clear Channel Communications
4.25%; 05/15/09 325,000 311,662
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.31%)
Masco
3.21%; 03/09/07 /1/ /2/ 400,000 400,779
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.19%)
Hanson Overseas
6.75%; 09/15/05 250,000 252,903
CABLE TV (0.97%)
Comcast
5.85%; 01/15/10 450,000 472,981
Cox Communications
3.55%; 12/14/07 /1/ /2/ 300,000 301,756
4.63%; 01/15/10 /2/ 275,000 270,927
6.88%; 06/15/05 120,000 120,395
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
CABLE TV (CONTINUED)
TCI Communications
$ $
7.61%; 10/04/05 100,000 101,994
1,268,053
CASINO HOTELS (0.10%)
Harrah's Operating
7.50%; 01/15/09 125,000 136,707
CELLULAR TELECOMMUNICATIONS (0.66%)
AT&T Wireless Services
7.35%; 03/01/06 180,000 185,205
Cingular Wireless
5.63%; 12/15/06 125,000 127,616
Telus
7.50%; 06/01/07 210,000 222,988
Verizon Wireless Capital
5.38%; 12/15/06 325,000 331,555
867,364
CHEMICALS-DIVERSIFIED (0.31%)
Chevron Phillips Chemical
5.38%; 06/15/07 110,000 112,326
Dow Chemical
7.00%; 08/15/05 140,000 141,355
E. I. Du Pont de Nemours
3.38%; 11/15/07 150,000 147,452
401,133
COATINGS & PAINT (0.14%)
Valspar
6.00%; 05/01/07 175,000 180,417
COMMERCIAL BANKS (0.52%)
AmSouth Bank
2.82%; 11/03/06 115,000 113,126
ANZ National Bank International
3.21%; 04/14/08 /1/ /2/ 250,000 249,915
Key Bank National Association
2.90%; 11/03/09 /1/ 200,000 199,955
Union Planters Bank
5.13%; 06/15/07 120,000 122,258
685,254
COMMERCIAL MORTGAGE BACKED SECURITY (0.23%)
Structured Adjustable Rate Mortgage Loan Trust
3.27%; 03/25/35 /1/ /3/ 300,000 300,000
COMMERCIAL SERVICE-FINANCE (0.05%)
Equifax
4.95%; 11/01/07 65,000 66,233
COMPUTERS (0.32%)
Hewlett-Packard
5.50%; 07/01/07 185,000 190,183
7.15%; 06/15/05 100,000 100,443
International Business Machines
4.25%; 09/15/09 135,000 134,622
425,248
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
CREDIT CARD ASSET BACKED SECURITIES (5.52%)
Bank One Issuance Trust
$ $
2.94%; 06/16/08 1,000,000 997,381
3.32%; 12/15/10 /1/ 350,000 352,306
Capital One Master Trust
5.30%; 06/15/09 700,000 712,629
Capital One Multi-Asset Execution Trust
3.17%; 12/15/09 /1/ 255,000 255,402
Chase Credit Card Master Trust
3.15%; 05/15/09 /1/ 300,000 299,941
3.28%; 01/17/11 /1/ 525,000 528,145
5.50%; 11/17/08 100,000 102,054
Citibank Credit Card Issuance Trust
3.42%; 06/25/09 /1/ 200,000 200,840
Citibank Credit Card Master Trust I
5.88%; 03/10/11 500,000 528,922
Discover Card Master Trust I
3.13%; 04/16/10 /1/ 250,000 249,465
5.15%; 10/15/09 923,000 943,973
6.05%; 08/18/08 855,000 870,875
MBNA Credit Card Master Note Trust
3.65%; 03/15/11 1,200,000 1,180,342
7,222,275
DATA PROCESSING & MANAGEMENT (0.11%)
First Data
3.38%; 08/01/08 155,000 150,748
DIVERSIFIED FINANCIAL SERVICES (1.62%)
General Electric Capital
0.87%; 03/10/40 /1/ /2/ 3,297,730 91,723
2.90%; 02/02/09 /1/ 240,000 240,629
2.98%; 03/04/08 /1/ 100,000 100,017
3.75%; 12/15/09 150,000 145,969
4.25%; 01/15/08 950,000 951,464
John Deere Capital
3.63%; 05/25/07 50,000 49,434
4.50%; 08/22/07 95,000 95,608
NiSource Finance
3.20%; 11/01/06 135,000 133,189
7.63%; 11/15/05 300,000 306,126
2,114,159
DIVERSIFIED MANUFACTURING OPERATIONS (0.61%)
Cooper Industries
5.25%; 07/01/07 80,000 81,650
Dover
6.45%; 11/15/05 100,000 101,341
Honeywell International
6.13%; 07/01/05 175,000 175,708
6.88%; 10/03/05 250,000 253,285
Tyco International Group
6.13%; 01/15/09 175,000 184,894
796,878
ELECTRIC PRODUCTS-MISCELLANEOUS (0.08%)
Emerson Electric
7.88%; 06/01/05 100,000 100,343
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
ELECTRIC-DISTRIBUTION (0.06%)
Detroit Edison
$ $
5.05%; 10/01/05 75,000 75,418
ELECTRIC-INTEGRATED (3.50%)
Alabama Power
2.80%; 12/01/06 60,000 58,912
Appalachian Power
4.80%; 06/15/05 140,000 140,207
Conectiv
5.30%; 06/01/05 45,000 45,054
Consolidated Edison
3.63%; 08/01/08 110,000 107,738
Dominion Resources
3.09%; 05/15/06 /1/ 120,000 120,306
7.63%; 07/15/05 105,000 105,853
Duke Energy
3.75%; 03/05/08 85,000 83,850
FPL Group Capital
3.25%; 04/11/06 125,000 124,408
4.09%; 02/16/07 150,000 149,763
Georgia Power
2.99%; 02/17/09 /1/ 130,000 130,063
Kansas Gas & Electric
6.20%; 01/15/06 325,000 329,600
MidAmerican Energy Holdings
4.63%; 10/01/07 245,000 245,416
Niagara Mohawk Power
7.75%; 05/15/06 160,000 166,481
Oncor Electric Delivery
5.00%; 09/01/07 95,000 96,057
Pacific Gas & Electric
3.60%; 03/01/09 185,000 179,922
Pepco Holdings
5.50%; 08/15/07 105,000 107,248
Pinnacle West Energy
3.63%; 04/01/07 /1/ /2/ 150,000 149,929
Potomac Electric Power
6.50%; 09/15/05 150,000 151,718
Progress Energy
5.85%; 10/30/08 125,000 129,616
6.75%; 03/01/06 290,000 296,511
PSEG Power
3.75%; 04/01/09 250,000 243,114
Public Service Company of Colorado
4.38%; 10/01/08 155,000 154,582
Scottish Power
4.91%; 03/15/10 325,000 328,679
Southern California Edison
6.38%; 01/15/06 350,000 356,124
TXU Energy
6.13%; 03/15/08 325,000 337,605
Wisconsin Electric Power
3.50%; 12/01/07 245,000 240,861
4,579,617
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FEDERAL & FEDERALLY SPONSORED CREDIT (2.07%)
Federal Farm Credit Bank
$ $
3.00%; 04/15/08 2,775,000 2,701,754
FIDUCIARY BANKS (0.13%)
Bank of New York
4.14%; 08/02/07 100,000 99,563
5.20%; 07/01/07 70,000 71,405
170,968
FINANCE-AUTO LOANS (2.18%)
Ford Motor Credit
6.13%; 01/09/06 340,000 341,562
6.50%; 01/25/07 550,000 549,945
6.88%; 02/01/06 350,000 354,031
7.60%; 08/01/05 175,000 176,226
General Motors Acceptance
4.39%; 10/20/05 /1/ 220,000 219,524
6.13%; 08/28/07 160,000 155,903
6.75%; 01/15/06 670,000 674,959
7.50%; 07/15/05 230,000 231,057
Toyota Motor Credit
2.80%; 01/18/06 150,000 149,080
2,852,287
FINANCE-COMMERCIAL (0.63%)
CIT Group
2.99%; 02/15/07 /1/ 130,000 130,246
7.38%; 04/02/07 470,000 496,978
Textron Financial
3.47%; 10/06/06 /1/ 200,000 200,756
827,980
FINANCE-CONSUMER LOANS (1.66%)
American General Finance
5.88%; 07/14/06 495,000 506,050
Household Finance
6.50%; 01/24/06 695,000 709,131
HSBC Finance
3.08%; 11/16/09 /1/ 275,000 276,163
4.75%; 04/15/10 200,000 201,137
John Deere Capital
4.13%; 01/15/10 130,000 128,242
SLM
4.17%; 03/02/09 /1/ 350,000 350,949
2,171,672
FINANCE-CREDIT CARD (0.59%)
Capital One Bank
6.70%; 05/15/08 200,000 212,930
6.88%; 02/01/06 325,000 332,247
MBNA
3.64%; 05/05/08 /1/ 230,000 229,864
775,041
FINANCE-INVESTMENT BANKER & BROKER (4.59%)
Banque Paribas
8.35%; 06/15/07 140,000 151,758
Bear Stearns
3.00%; 03/30/06 130,000 129,148
3.49%; 01/30/09 /1/ 450,000 452,200
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-INVESTMENT BANKER & BROKER (CONTINUED)
Citigroup
$ $
4.13%; 02/22/10 675,000 665,052
6.75%; 12/01/05 640,000 651,514
Credit Suisse First Boston
5.75%; 04/15/07 365,000 375,679
Goldman Sachs Group
3.12%; 03/02/10 /1/ 200,000 199,552
3.49%; 07/23/09 /1/ 125,000 125,492
6.88%; 01/15/11 325,000 359,188
Lehman Brothers Holdings
3.02%; 11/10/09 /1/ 250,000 250,648
4.25%; 01/27/10 130,000 128,245
6.25%; 05/15/06 530,000 542,499
Merrill Lynch
2.99%; 02/05/10 /1/ 150,000 150,108
3.02%; 02/06/09 /1/ 620,000 621,705
4.13%; 03/02/09 /1/ 130,000 129,791
Morgan Stanley
3.42%; 01/15/10 /1/ 605,000 606,456
4.00%; 01/15/10 475,000 462,635
6,001,670
FINANCE-LEASING COMPANY (0.54%)
Boeing Capital
5.75%; 02/15/07 260,000 267,094
International Lease Finance
3.54%; 01/15/10 /1/ 300,000 299,299
5.80%; 08/15/07 140,000 144,591
710,984
FINANCE-MORTGAGE LOAN/BANKER (7.47%)
Countrywide Home Loan
2.88%; 02/15/07 120,000 117,196
3.05%; 11/16/07 /1/ 150,000 150,159
4.50%; 01/25/33 92,482 91,980
Federal Home Loan Bank
2.88%; 09/15/06 2,600,000 2,570,563
Federal Home Loan Mortgage
3.40%; 06/15/23 /1/ 340,688 343,267
4.00%; 01/15/22 600,000 597,266
5.75%; 03/15/09 900,000 952,009
Federal National Mortgage Association
4.11%; 02/17/09 /1/ 400,000 401,076
4.25%; 05/15/09 500,000 501,737
5.25%; 04/15/07 2,650,000 2,717,024
Federal National Mortgage Association Whole
Loan
3.22%; 05/25/35 /1/ 473,665 473,659
Greenpoint Mortgage Funding
3.36%; 06/25/45 /1/ /3/ 450,000 450,000
3.72%; 05/31/35 /1/ /3/ /5/ 400,000 400,000
9,765,936
FINANCE-OTHER SERVICES (0.42%)
Caterpillar Financial Services
3.00%; 02/15/07 170,000 167,004
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-OTHER SERVICES (CONTINUED)
Mellon Funding
$ $
4.88%; 06/15/07 120,000 121,779
National Rural Utilities
6.00%; 05/15/06 255,000 260,359
549,142
FOOD-MEAT PRODUCTS (0.29%)
Tyson Foods
6.75%; 06/01/05 150,000 150,304
7.25%; 10/01/06 225,000 234,800
385,104
FOOD-MISCELLANEOUS/DIVERSIFIED (0.74%)
Campbell Soup
5.50%; 03/15/07 265,000 270,503
General Mills
5.13%; 02/15/07 85,000 86,558
Kellogg
6.00%; 04/01/06 165,000 168,303
Kraft Foods
4.63%; 11/01/06 220,000 221,583
Sara Lee
2.75%; 06/15/08 60,000 57,647
Unilever Capital
6.88%; 11/01/05 155,000 157,528
962,122
FOOD-RETAIL (0.57%)
Kroger
6.38%; 03/01/08 325,000 340,212
Safeway
2.50%; 11/01/05 255,000 253,224
3.80%; 08/15/05 150,000 149,927
743,363
GAS-DISTRIBUTION (0.10%)
Sempra Energy
4.75%; 05/15/09 135,000 135,263
HOME EQUITY-OTHER (2.30%)
Asset Backed Funding Certificates
3.28%; 02/25/35 /1/ 217,761 217,751
Encore Credit Receivables Trust
3.22%; 02/25/35 /1/ 325,000 324,985
First NLC Trust
3.35%; 05/25/35 /1/ /3/ 525,000 525,000
Option One Mortgage Loan Trust
3.31%; 05/25/35 /1/ /3/ 400,000 400,000
Specialty Underwriting & Residential Finance
3.25%; 12/25/35 /1/ 700,000 699,967
3.27%; 03/25/36 /1/ /3/ 325,000 325,000
3.33%; 07/25/35 /1/ 450,000 451,648
3.53%; 02/25/35 /1/ 60,000 60,204
3,004,555
HOME EQUITY-SEQUENTIAL (2.66%)
Ameriquest Mortgage Securities
3.02%; 10/25/33 46,098 45,916
3.64%; 01/25/34 630,235 629,098
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
HOME EQUITY-SEQUENTIAL (CONTINUED)
Ameriquest Mortgage
Securities (continued)
$ $
4.26%; 08/25/33 464,372 463,817
New Century Home Equity Loan Trust
3.56%; 11/25/33 400,000 398,444
Residential Asset Securities
3.28%; 12/25/33 /1/ 1,175,000 1,176,985
3.29%; 04/25/35 /1/ 400,000 400,000
4.37%; 12/25/33 /1/ 275,000 279,774
4.82%; 04/25/32 /1/ 82,778 83,189
3,477,223
INDUSTRIAL GASES (0.13%)
Praxair
4.75%; 07/15/07 115,000 116,326
6.85%; 06/15/05 50,000 50,184
166,510
INSURANCE BROKERS (0.40%)
Aon
6.95%; 01/15/07 /1/ 110,000 114,062
8.65%; 05/15/05 140,000 140,214
Marsh & McLennan
3.28%; 07/13/07 /1/ 125,000 124,180
3.63%; 02/15/08 145,000 141,778
520,234
LIFE & HEALTH INSURANCE (0.46%)
Hartford Life Global Funding Trusts
3.18%; 09/15/09 /1/ 325,000 323,598
Lincoln National
5.25%; 06/15/07 110,000 112,363
Torchmark
6.25%; 12/15/06 160,000 165,485
601,446
MEDICAL PRODUCTS (0.10%)
Baxter International
5.25%; 05/01/07 130,000 131,985
MEDICAL-HMO (0.47%)
Anthem
3.50%; 09/01/07 150,000 147,893
4.88%; 08/01/05 165,000 165,375
UnitedHealth Group
3.30%; 01/30/08 175,000 170,649
3.38%; 08/15/07 130,000 127,874
611,791
MISCELLANEOUS INVESTING (1.30%)
Archstone-Smith Operating Trust
3.00%; 06/15/08 150,000 143,809
Camden Property Trust
4.38%; 01/15/10 100,000 97,917
5.88%; 06/01/07 120,000 122,946
Developers Diversified Realty
3.88%; 01/30/09 120,000 115,995
Duke Realty
3.35%; 01/15/08 115,000 111,485
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MISCELLANEOUS INVESTING (CONTINUED)
iStar Financial
$ $
3.30%; 03/03/08 /1/ 200,000 198,549
4.25%; 03/12/07 /1/ 200,000 202,638
5.38%; 04/15/10 225,000 225,653
Kimco Realty
2.94%; 08/01/06 /1/ 250,000 250,269
Simon Property Group
3.75%; 01/30/09 165,000 159,452
United Dominion Realty Trust
4.50%; 03/03/08 75,000 75,681
1,704,394
MONEY CENTER BANKS (1.69%)
Bank of America
2.96%; 02/17/09 /1/ 325,000 325,503
4.75%; 10/15/06 640,000 647,666
JP Morgan Chase
3.13%; 12/11/06 130,000 128,341
3.31%; 10/02/09 /1/ 525,000 525,503
5.25%; 05/30/07 385,000 393,365
5.35%; 03/01/07 180,000 183,893
2,204,271
MORTGAGE BACKED SECURITIES (17.91%)
1301 Avenue of the Americas Trust
7.54%; 08/03/10 /1/ /2/ 400,000 403,929
Banc of America Mortgage
Securities
4.81%; 05/25/35 /1/ /3/ 675,000 675,000
Bear Stearns Commercial Mortgage Securities
0.44%; 02/11/41 /1/ 17,504,592 267,995
0.79%; 05/11/39 /1/ /2/ 2,550,199 63,941
3.27%; 06/15/17 /1/ /2/ 325,000 325,092
3.97%; 11/11/35 399,854 394,658
4.13%; 11/11/41 700,000 692,373
7.64%; 02/15/32 362,292 387,379
Chase Commercial Mortgage Securities
7.03%; 01/15/32 281,383 295,365
7.56%; 10/15/32 500,000 563,299
Chase Manhattan Bank-First Union National Bank
Commercial Mortgage Trust
7.13%; 08/15/31 1,048,677 1,091,332
Commercial Mortgage Acceptance
6.79%; 06/15/31 36,718 37,872
Commercial Mortgage Pass-Through Certificate
3.25%; 06/10/38 /2/ 90,916 86,724
CS First Boston Mortgage Securities
6.25%; 12/16/35 400,000 419,080
6.38%; 12/16/35 100,000 108,363
DLJ Commercial Mortgage
6.14%; 02/18/31 25,162 25,134
First Union Commercial Mortgage Securities
7.38%; 04/18/29 404,472 423,511
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MORTGAGE BACKED SECURITIES (CONTINUED)
GE Capital Commercial Mortgage
$ $
3.35%; 08/11/36 239,181 237,091
5.99%; 12/10/35 130,000 137,441
6.32%; 01/15/33 82,939 84,785
GMAC Commercial Mortgage Securities
0.38%; 05/10/40 /1/ /2/ 134,556,498 1,134,042
0.69%; 08/10/38 /1/ /2/ 53,045,247 1,149,756
4.32%; 10/15/38 100,890 101,284
6.57%; 09/15/33 105,599 106,485
IMPAC Commercial Mortgage Trust
3.17%; 08/25/35 /1/ /3/ 150,000 150,000
3.45%; 04/25/35 /1/ /3/ 271,650 271,650
3.49%; 10/25/33 /1/ 353,813 353,979
4.02%; 10/25/33 /1/ 363,608 366,335
Indymac Index Mortgage Loan Trust
3.29%; 04/25/35 /1/ /3/ 275,000 275,000
3.35%; 04/25/35 /1/ 247,759 247,998
JP Morgan Chase Commercial Mortgage Securities
3.48%; 06/12/41 707,371 694,189
4.37%; 10/12/37 450,400 450,280
4.47%; 11/15/35 145,490 146,006
4.55%; 05/12/34 296,033 297,629
LB-UBS Commercial Mortgage Trust
1.37%; 03/15/36 /1/ /2/ 1,638,942 77,961
3.63%; 10/15/29 1,106,274 1,091,115
4.19%; 08/15/29 220,000 217,719
4.90%; 06/15/26 1,235,000 1,255,111
5.40%; 03/15/26 330,527 336,097
6.06%; 06/15/20 567,969 591,721
Merrill Lynch Mortgage Investors
3.22%; 02/25/36 /1/ 325,000 324,985
3.37%; 07/25/35 /1/ 700,000 702,327
7.12%; 06/18/29 234,091 242,479
7.83%; 12/26/25 /1/ 74,103 74,337
Merrill Lynch Mortgage Trust
0.47%; 09/12/42 /1/ 51,930,000 846,355
3.59%; 09/12/41 372,761 368,101
Morgan Stanley Capital I
4.57%; 12/18/32 356,053 357,054
5.33%; 12/18/32 500,000 510,147
6.54%; 02/15/31 185,000 195,538
NationsLink Funding
7.23%; 06/20/31 400,000 432,220
PNC Mortgage Acceptance
7.11%; 12/10/32 176,591 184,457
Sequoia Mortgage Trust
3.22%; 02/20/35 /1/ 236,581 236,468
Structured Asset Mortgage
3.70%; 05/31/35 /1/ /3/ /5/ 400,000 400,000
Wachovia Bank Commercial Mortgage Trust
0.49%; 01/15/41 /1/ /2/ 23,363,978 274,620
Washington Mutual
3.27%; 01/25/45 /1/ 1,200,000 1,196,992
3.44%; 07/25/44 /1/ 375,873 377,171
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MORTGAGE BACKED SECURITIES (CONTINUED)
Washington Mutual (continued)
$ $
4.07%; 10/25/33 /1/ 675,000 669,021
23,426,993
MORTGAGE PASS THRU SECURITIES (0.44%)
Countrywide Home Loan Mortgage Pass Through
Trust
4.66%; 06/20/35 /1/ /3/ 575,000 574,191
MULTI-LINE INSURANCE (0.69%)
Allstate
5.38%; 12/01/06 135,000 137,454
7.88%; 05/01/05 90,000 90,000
CNA Financial
6.60%; 12/15/08 200,000 211,084
Hartford Financial Services Group
4.70%; 09/01/07 155,000 156,025
MetLife
3.91%; 05/15/05 150,000 150,041
5.25%; 12/01/06 150,000 153,131
897,735
MULTIMEDIA (1.28%)
AOL Time Warner
6.13%; 04/15/06 305,000 311,220
Gannett
5.50%; 04/01/07 120,000 123,075
News America
4.75%; 03/15/10 275,000 276,352
Thomson
5.75%; 02/01/08 145,000 149,993
Time Warner Entertainment
7.25%; 09/01/08 250,000 270,782
Viacom
7.15%; 05/20/05 80,000 80,118
7.75%; 06/01/05 460,000 461,446
1,672,986
OIL COMPANY-EXPLORATION & PRODUCTION (0.33%)
Pemex Project Funding Master Trust
6.13%; 08/15/08 250,000 256,875
PennzEnergy
10.25%; 11/01/05 175,000 179,988
436,863
OIL COMPANY-INTEGRATED (0.21%)
Marathon Oil
5.38%; 06/01/07 125,000 127,751
Occidental Petroleum
4.00%; 11/30/07 150,000 148,852
276,603
OIL FIELD MACHINERY & EQUIPMENT (0.12%)
Cooper Cameron
2.65%; 04/15/07 165,000 159,669
OIL REFINING & MARKETING (0.16%)
Valero Energy
7.38%; 03/15/06 200,000 205,567
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
OIL-FIELD SERVICES (0.09%)
Halliburton
$ $
4.65%; 10/17/05 /1/ 120,000 120,734
PAPER & RELATED PRODUCTS (0.39%)
Champion International
7.10%; 09/01/05 325,000 327,959
Union Camp
7.00%; 08/15/06 179,000 184,763
512,722
PHARMACY SERVICES (0.06%)
Caremark Rx
7.38%; 10/01/06 75,000 77,900
PIPELINES (0.37%)
Duke Energy Field Services
7.50%; 08/16/05 240,000 242,706
Enbridge Energy Partners
4.00%; 01/15/09 150,000 146,486
Kinder Morgan Energy Partners
5.35%; 08/15/07 100,000 101,573
490,765
PROPERTY & CASUALTY INSURANCE (0.50%)
ACE
6.00%; 04/01/07 150,000 154,077
Chubb
6.15%; 08/15/05 50,000 50,330
Markel
7.00%; 05/15/08 325,000 347,203
Travelers Property Casualty
3.75%; 03/15/08 105,000 103,115
654,725
PUBLISHING-BOOKS (0.20%)
Reed Elsevier Capital
6.13%; 08/01/06 115,000 117,386
7.00%; 05/15/05 150,000 150,170
267,556
REAL ESTATE OPERATOR & DEVELOPER (0.21%)
EOP Operating
7.75%; 11/15/07 175,000 188,591
ERP Operating
4.75%; 06/15/09 80,000 80,225
268,816
REGIONAL AUTHORITY (0.15%)
New Brunswick
3.50%; 10/23/07 40,000 39,448
Province of Manitoba
2.75%; 01/17/06 155,000 154,272
193,720
REGIONAL BANKS (1.54%)
KeyCorp
3.36%; 07/23/07 /1/ 200,000 200,181
Korea Development Bank
3.88%; 03/02/09 120,000 116,866
7.25%; 05/15/06 160,000 165,330
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
REGIONAL BANKS (CONTINUED)
PNC Funding
$ $
5.75%; 08/01/06 220,000 224,832
SunTrust Banks
2.50%; 11/01/06 55,000 53,800
5.05%; 07/01/07 120,000 122,167
U.S. Bancorp
6.75%; 10/15/05 202,000 204,700
Wachovia
3.06%; 03/01/12 /1/ 600,000 599,313
Wells Fargo
3.00%; 03/10/08 /1/ 325,000 324,770
2,011,959
RENTAL-AUTO & EQUIPMENT (0.08%)
Hertz
4.70%; 10/02/06 100,000 98,439
RETAIL-DISCOUNT (0.43%)
Costco Wholesale
5.50%; 03/15/07 140,000 143,792
Target
5.40%; 10/01/08 150,000 155,797
Wal-Mart Stores
4.38%; 07/12/07 260,000 261,490
561,079
RETAIL-DRUG STORE (0.11%)
CVS
3.88%; 11/01/07 150,000 148,405
RETAIL-MAJOR DEPARTMENT STORE (0.25%)
May Department Stores
3.95%; 07/15/07 330,000 326,818
RETAIL-RESTAURANTS (0.31%)
McDonald's
5.38%; 04/30/07 113,000 116,028
Yum! Brands
8.50%; 04/15/06 275,000 286,520
402,548
SAVINGS & LOANS-THRIFTS (0.56%)
Washington Mutual
3.20%; 03/20/08 /1/ 150,000 149,931
3.35%; 03/22/12 /1/ 250,000 249,704
3.44%; 01/15/10 /1/ 200,000 200,803
4.00%; 01/15/09 140,000 137,484
737,922
SOVEREIGN (1.50%)
Italy Government
4.38%; 10/25/06 1,195,000 1,205,609
Mexico Government
8.38%; 01/14/11 250,000 286,125
9.88%; 01/15/07 435,000 475,020
1,966,754
SPECIAL PURPOSE ENTITY (0.40%)
Allstate Life Global Funding Trusts
4.25%; 02/26/10 275,000 272,486
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
SPECIAL PURPOSE ENTITY (CONTINUED)
Fondo Latinoamericano de Reservas
$ $
3.00%; 08/01/06 /2/ 115,000 113,919
Rio Tinto Finance
2.63%; 09/30/08 150,000 142,161
528,566
SUPRANATIONAL BANK (0.49%)
Asian Development Bank
2.38%; 03/15/06 345,000 342,086
Corp Andina de Fomento
7.38%; 01/18/11 200,000 223,905
8.88%; 06/01/05 75,000 75,309
641,300
TELECOMMUNICATION SERVICES (0.28%)
Verizon Global Funding
6.75%; 12/01/05 355,000 361,316
TELEPHONE-INTEGRATED (2.32%)
ALLTEL
6.75%; 09/15/05 130,000 131,500
BellSouth
4.26%; 04/26/21 325,000 325,000
British Telecommunications
7.88%; 12/15/05 345,000 353,644
Deutsche Telekom International Finance
8.25%; 06/15/05 170,000 170,954
France Telecom
7.45%; 03/01/06 /1/ 175,000 180,064
GTE Florida
6.25%; 11/15/05 /6/ 150,000 152,069
New England Telephone & Telegraph
5.88%; 04/15/09 220,000 228,919
Royal KPN
7.50%; 10/01/05 60,000 60,961
SBC Communications
5.75%; 05/02/06 325,000 330,815
Sprint Capital
7.13%; 01/30/06 335,000 342,276
7.63%; 01/30/11 250,000 282,190
Telecom Italia Capital
4.00%; 11/15/08 260,000 254,502
4.00%; 01/15/10 /2/ 125,000 120,750
Telefonos de Mexico
4.50%; 11/19/08 100,000 98,489
3,032,133
TEXTILE-HOME FURNISHINGS (0.10%)
Mohawk Industries
6.50%; 04/15/07 125,000 130,440
TRANSPORT-RAIL (1.06%)
Burlington Northern Santa Fe
6.38%; 12/15/05 330,000 335,248
CSX
3.05%; 08/03/06 /1/ 125,000 125,255
6.25%; 10/15/08 120,000 126,984
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
TRANSPORT-RAIL (CONTINUED)
Norfolk Southern
$ $
8.38%; 05/15/05 325,000 325,405
Union Pacific
3.88%; 02/15/09 200,000 195,661
7.60%; 05/01/05 275,000 275,000
1,383,553
WIRELESS EQUIPMENT (0.18%)
TeleCorp PCS
10.63%; 07/15/10 225,000 239,720
TOTAL BONDS 116,713,637
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) CERTIFICATES (4.37%)
4.50%; 10/01/09 210,907 211,383
4.50%; 12/01/09 337,367 338,128
4.50%; 01/01/10 124,921 125,273
4.50%; 02/01/10 678,844 680,755
4.50%; 04/01/10 283,999 284,799
4.50%; 09/01/10 259,982 260,714
4.50%; 10/01/10 591,220 592,884
4.50%; 11/01/10 296,251 297,085
4.50%; 02/01/11 92,652 92,965
4.50%; 04/01/11 212,684 213,403
4.50%; 06/01/11 648,429 649,576
4.50%; 07/01/11 232,529 233,316
4.50%; 10/01/11 291,033 292,017
4.50%; 11/01/11 734,357 736,841
5.00%; 09/01/09 129,053 131,097
5.50%; 12/01/08 36,030 36,633
5.50%; 02/01/09 70,214 71,429
5.50%; 03/01/09 41,613 42,333
5.50%; 04/01/09 93,776 95,399
6.50%; 04/01/09 25,086 26,132
6.50%; 04/01/15 12,882 13,492
7.00%; 12/01/22 176,240 187,091
7.25%; 12/01/07 25,876 26,493
7.50%; 12/01/29 5,850 6,284
8.00%; 12/01/11 13,546 14,080
8.00%; 10/01/22 2,316 2,510
8.25%; 01/01/12 6,604 6,942
9.00%; 09/01/09 44,537 45,688
TOTAL FHLMC CERTIFICATES 5,714,742
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) CERTIFICATES (2.80%)
$ $
4.00%; 05/01/10 470,432 464,665
4.00%; 06/01/10 230,251 227,428
4.00%; 07/01/10 356,394 352,025
4.00%; 08/01/10 218,611 215,931
4.32%; 08/01/34 /1/ 572,385 572,397
4.50%; 03/01/10 341,471 342,074
4.50%; 08/01/11 556,153 557,442
4.50%; 09/01/11 253,724 254,312
5.50%; 02/01/09 230,188 234,123
5.50%; 10/01/09 155,430 158,087
6.00%; 07/01/28 101,023 104,061
7.50%; 10/01/29 35,416 37,979
8.00%; 10/01/06 3,229 3,280
8.00%; 05/01/27 18,225 19,871
8.50%; 05/01/22 94,088 102,519
9.00%; 02/01/25 13,538 14,838
TOTAL FNMA CERTIFICATES 3,661,032
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
TREASURY BONDS (4.69%)
U.S. Treasury Inflation-Indexed Obligations
4.25%; 01/15/10 5,357,013 6,127,919
TOTAL TREASURY BONDS 6,127,919
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (0.93%)
MONEY CENTER BANKS (0.93%)
Investment in Joint Trading Account; Citicorp
2.95%; 05/02/05 1,211,051 1,211,051
TOTAL COMMERCIAL PAPER 1,211,051
Maturity
Amount Value
- ---------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (0.12%)
Deutsche Bank Securities; 2.96%; dated
04/29/05 maturing 05/02/05 (collateralized by
Federal National Mortgage Association; $
$161,527; 04/26/17) /7/ $ 158,399 158,360
TOTAL REPURCHASE AGREEMENTS 158,360
------------
TOTAL PORTFOLIO INVESTMENTS (102.14%) 133,586,741
LIABILITIES, NET OF CASH AND RECEIVABLES (-2.14%) (2,793,163)
TOTAL NET ASSETS (100.00%) $130,793,578
---------------
/1 /Variable rate.
/2 /Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from registration,
normally to qualified institutional buyers. Unless otherwise indicated, these
securities are not considered to be illiquid. At the end of the period, the
value of these securities totaled $5,683,896 or 4.35% of net assets.
/3 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of these
securities totaled $5,471,344 or 4.18% of net assets.
/4 /Non-income producing security.
/5 /Security purchased on a when-issued basis. See Notes to Financial
Statements.
/6 /Security or a portion of the security was on loan at the end of the period.
/7 /Security was purchased with the cash proceeds from securities loans.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 316,766
Unrealized Depreciation (2,030,994)
------------
Net Unrealized Appreciation (Depreciation) (1,714,228)
Cost for federal income tax purposes $135,300,969
Notional Unrealized
Description Amount Gain (Loss)
- -------------------------------------------------------------------------
SWAP AGREEMENTS
TOTAL RETURN SWAPS
Receive a monthly return equal to the Lehman $6,650,000 $86,481
ERISA Eligible CMBS Index and pay monthly a
floating rate based on 1-month LIBOR less 15
basis points with Deutsche Bank. Expires June
2005.
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
$
Mortgage Securities 34,323,021 25.68%
Financial 28,950,672 21.66
Asset Backed Securities 22,614,534 16.92
Government 20,470,244 15.32
Communications 8,020,790 6.00
Utilities 5,229,613 3.91
Consumer, Non-cyclical 3,756,156 2.81
Industrial 3,647,914 2.73
Consumer, Cyclical 3,046,819 2.28
Energy 1,690,200 1.26
Basic Materials 1,260,782 0.94
Technology 575,996 0.43
Swap Agreements 86,481 0.06
TOTAL $133,673,222 100.00%
---------------- -----------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL MIDCAP FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (98.32%)
ADVERTISING AGENCIES (0.63%)
$
Interpublic Group /1/ 271,394 3,490,127
AEROSPACE & DEFENSE EQUIPMENT (1.46%)
Alliant Techsystems /1/ 116,127 8,033,666
AGRICULTURAL OPERATIONS (0.59%)
Delta & Pine Land 129,633 3,266,752
APPAREL MANUFACTURERS (0.70%)
Polo Ralph Lauren 109,604 3,847,100
APPLICATIONS SOFTWARE (0.99%)
Intuit /1/ 134,487 5,419,826
BROADCASTING SERVICES & PROGRAMMING (1.80%)
Liberty Media /1/ 984,740 9,886,790
BUILDING & CONSTRUCTION PRODUCTS-
MISCELLANEOUS (1.07%)
Vulcan Materials 110,896 5,881,924
BUILDING PRODUCTS-WOOD (0.86%)
Rayonier 94,666 4,757,913
CABLE TV (0.75%)
Liberty Media International /1/ 100,021 4,147,871
CASINO HOTELS (1.63%)
Harrah's Entertainment 136,800 8,976,816
COMMERCIAL BANKS (5.67%)
M&T Bank 63,640 6,583,558
Marshall & Ilsley 80,311 3,424,461
North Fork Bancorp 263,594 7,420,171
TCF Financial 543,525 13,745,747
31,173,937
COMMERCIAL SERVICE-FINANCE (2.78%)
Dun & Bradstreet /1/ 80,414 5,021,050
MoneyGram International 154,274 2,992,916
Paychex 238,475 7,297,335
15,311,301
COMMERCIAL SERVICES (3.71%)
Arbitron 204,657 8,661,084
Magellan Health Services /1/ 85,725 2,919,794
ServiceMaster 312,749 4,012,570
Weight Watchers International /1/ 114,926 4,798,160
20,391,608
COMPUTER SERVICES (2.99%)
Ceridian /1/ 263,769 4,449,783
DST Systems /1/ 117,442 5,331,867
Sungard Data Systems /1/ 199,994 6,679,799
16,461,449
COMPUTERS-INTEGRATED SYSTEMS (3.30%)
Diebold 169,698 8,208,292
NCR /1/ 301,066 9,935,178
18,143,470
COMPUTERS-MEMORY DEVICES (1.10%)
Storage Technology /1/ 217,531 6,047,362
s
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMPUTERS-PERIPHERAL EQUIPMENT (0.79%)
$
Lexmark International /1/ 62,522 4,342,153
DATA PROCESSING & MANAGEMENT (1.50%)
Certegy 126,780 4,618,595
Reynolds & Reynolds 138,191 3,644,097
8,262,692
DENTAL SUPPLIES & EQUIPMENT (0.82%)
Dentsply International 82,184 4,492,177
DIVERSIFIED MANUFACTURING OPERATIONS (1.02%)
Dover 82,337 2,993,773
Lancaster Colony 62,964 2,616,784
5,610,557
DIVERSIFIED OPERATIONS (0.98%)
Brascan 149,137 5,371,915
DIVERSIFIED OPERATORS-COMMERCIAL
SERVICES (0.93%)
Aramark 208,029 5,098,791
ELECTRIC-INTEGRATED (1.94%)
Ameren 131,729 6,810,389
Scana 99,139 3,850,559
10,660,948
ELECTRONIC COMPONENTS-MISCELLANEOUS (2.62%)
Gentex 444,650 14,433,339
FOOD-CANNED (1.06%)
Del Monte Foods /1/ 558,322 5,823,298
FOOD-DAIRY PRODUCTS (0.52%)
Dean Foods /1/ 82,522 2,835,456
FOOD-MISCELLANEOUS/DIVERSIFIED (0.75%)
McCormick 119,378 4,129,285
GOLD MINING (1.21%)
Newmont Mining 174,766 6,635,865
HOSPITAL BEDS & EQUIPMENT (1.03%)
Hillenbrand Industries 102,880 5,681,034
INSURANCE BROKERS (1.65%)
Aon 270,495 5,639,821
Arthur J. Gallagher 124,165 3,456,753
9,096,574
INVESTMENT MANAGEMENT & ADVISORY
SERVICES (1.34%)
Eaton Vance 105,317 2,467,577
Federated Investors 172,960 4,920,712
7,388,289
LIFE & HEALTH INSURANCE (2.49%)
Aflac 223,797 9,097,348
Torchmark 85,639 4,575,692
13,673,040
LINEN SUPPLY & RELATED ITEMS (2.24%)
Cintas 318,790 12,302,106
LOTTERY SERVICES (1.68%)
GTECH Holdings 378,610 9,264,587
s
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MACHINERY-PRINT TRADE (1.68%)
$
Zebra Technologies /1/ 193,024 9,218,826
MEDICAL INFORMATION SYSTEM (2.11%)
IMS Health 484,452 11,617,159
MEDICAL INSTRUMENTS (1.84%)
Beckman Coulter 84,043 5,606,508
Biomet 116,020 4,488,814
10,095,322
MEDICAL LABORATORY & TESTING SERVICE (1.47%)
Laboratory Corp. of America Holdings /1/ 163,608 8,098,596
MEDICAL PRODUCTS (1.39%)
Varian Medical Systems /1/ 227,288 7,668,697
MEDICAL-DRUGS (3.38%)
Medimmune /1/ 262,580 6,661,655
Shire Pharmaceuticals Group 151,393 4,705,294
Valeant Pharmaceuticals International 348,996 7,241,667
18,608,616
MEDICAL-HMO (0.84%)
Coventry Health Care /1/ 67,605 4,626,210
MEDICAL-HOSPITALS (0.58%)
Health Management Associates 129,823 3,210,523
METAL-DIVERSIFIED (1.17%)
Freeport-McMoran Copper & Gold 186,321 6,457,886
MULTI-LINE INSURANCE (1.21%)
Loews 93,902 6,655,774
MULTIMEDIA (0.82%)
E.W. Scripps 88,096 4,486,729
NON-HAZARDOUS WASTE DISPOSAL (1.76%)
Republic Services 231,509 8,010,211
Waste Management 58,998 1,680,853
9,691,064
OFFICE AUTOMATION & EQUIPMENT (0.62%)
Pitney Bowes 75,903 3,394,382
OIL COMPANY-EXPLORATION & PRODUCTION (2.68%)
Encore Acquisition /1/ 92,495 3,396,416
Pioneer Natural Resources 149,274 6,069,481
XTO Energy 174,621 5,268,316
14,734,213
OIL COMPANY-INTEGRATED (0.83%)
Marathon Oil 98,350 4,580,160
OIL-FIELD SERVICES (1.78%)
BJ Services 132,463 6,457,571
Weatherford International /1/ 63,764 3,325,293
9,782,864
PHOTO EQUIPMENT & SUPPLIES (0.70%)
Eastman Kodak 153,681 3,842,025
PIPELINES (2.30%)
Equitable Resources 76,923 4,433,842
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PIPELINES (CONTINUED)
$
Questar 140,822 8,224,005
12,657,847
POWER CONVERTER & SUPPLY EQUIPMENT (0.72%)
American Power Conversion 162,356 3,938,757
PROPERTY & CASUALTY INSURANCE (3.03%)
Fidelity National Financial 239,713 7,697,184
Markel /1/ 8,677 2,977,079
Mercury General 113,961 6,023,979
16,698,242
REAL ESTATE OPERATOR & DEVELOPER (1.11%)
Catellus Development 91,858 2,544,467
Forest City Enterprises 56,743 3,583,320
6,127,787
REINSURANCE (1.30%)
Everest Re Group 87,294 7,175,567
RETAIL-AUTOMOBILE (0.10%)
Carmax /1/ 19,579 534,115
RETAIL-DISCOUNT (1.46%)
TJX 354,928 8,039,119
RETAIL-JEWELRY (0.99%)
Tiffany 181,080 5,459,562
RETAIL-REGIONAL DEPARTMENT STORE (1.30%)
Neiman Marcus Group 72,820 7,159,662
RETAIL-RESTAURANTS (1.58%)
Yum! Brands 185,247 8,699,199
TELEPHONE-INTEGRATED (2.49%)
Citizens Communications 767,487 9,785,459
Telephone & Data Systems 50,532 3,900,565
13,686,024
TEXTILE-HOME FURNISHINGS (1.13%)
Mohawk Industries /1/ 80,138 6,235,538
TOYS (0.82%)
Mattel 251,378 4,537,373
TRANSPORT-TRUCK (0.53%)
Heartland Express 158,513 2,938,831
TOTAL COMMON STOCKS 540,996,687
Principal
Amount Value
- ------------------------------------------------------------------------------------------
COMMERCIAL PAPER (1.79%)
MONEY CENTER BANKS (1.79%)
Investment in Joint Trading Account; Citicorp
$ $
2.95%; 05/02/05 9,870,797 9,870,797
TOTAL COMMERCIAL PAPER 9,870,797
------------
TOTAL PORTFOLIO INVESTMENTS (100.11%) 550,867,484
LIABILITIES, NET OF CASH, RECEIVABLES, AND
OTHER ASSETS (-0.11%) (599,552)
TOTAL NET ASSETS (100.00%) $550,267,932
---------------
/1 /Non-income producing security.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 95,769,704
Unrealized Depreciation (12,835,287)
------------
Net Unrealized Appreciation (Depreciation) 82,934,417
Cost for federal income tax purposes $467,933,067
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- ------------------------------------------------------------------------------
Consumer, Non-cyclical $114,316,616 20.75%
Financial 107,860,007 19.58
Technology 78,709,544 14.29
Consumer, Cyclical 75,055,178 13.62
Industrial 63,588,989 11.54
Energy 41,755,082 7.58
Communications 35,697,541 6.48
Basic Materials 17,851,664 3.24
Utilities 10,660,948 1.94
Diversified 5,371,915 0.98
TOTAL $550,867,484 100.00%
---------------- -----------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
135
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS BLUE CHIP FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (99.69%)
AEROSPACE & DEFENSE (2.97%)
$
Boeing 39,300 2,339,136
Northrop Grumman 19,000 1,041,960
Raytheon 26,600 1,000,426
4,381,522
AEROSPACE & DEFENSE EQUIPMENT (0.78%)
General Dynamics 2,300 241,615
United Technologies 9,000 915,480
1,157,095
AGRICULTURAL OPERATIONS (0.65%)
Monsanto 16,400 961,368
APPAREL MANUFACTURERS (0.20%)
Coach /1/ 10,800 289,440
APPLICATIONS SOFTWARE (3.25%)
Microsoft 190,044 4,808,113
ATHLETIC FOOTWEAR (0.16%)
Nike 3,144 241,491
AUDIO & VIDEO PRODUCTS (0.52%)
Harman International Industries 9,700 762,226
AUTO-CARS & LIGHT TRUCKS (0.51%)
Ford Motor 83,200 757,952
BATTERIES & BATTERY SYSTEMS (0.23%)
Energizer Holdings /1/ 5,900 336,123
BEVERAGES-NON-ALCOHOLIC (1.36%)
Coca-Cola 23,900 1,038,216
Pepsico 17,472 972,142
2,010,358
BROADCASTING SERVICES & PROGRAMMING (0.36%)
Liberty Media /1/ 52,300 525,092
CABLE TV (1.36%)
Comcast /1/ 24,200 777,062
Comcast /1/ 39,000 1,237,470
2,014,532
CASINO HOTELS (0.14%)
MGM Mirage /1/ 3,000 209,430
CELLULAR TELECOMMUNICATIONS (0.54%)
Nextel Communications /1/ 24,400 682,956
U.S. Cellular /1/ 2,400 110,880
793,836
CHEMICALS-DIVERSIFIED (0.42%)
E. I. Du Pont de Nemours 13,200 621,852
CHEMICALS-SPECIALTY (0.36%)
Lubrizol 13,800 535,026
COMMERCIAL BANKS (0.47%)
Bank of Hawaii 8,600 407,210
UnionBanCal 4,700 289,332
696,542
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL SERVICE-FINANCE (0.66%)
$
Moody's 11,800 969,252
COMPUTER AIDED DESIGN (0.60%)
Autodesk 28,000 891,240
COMPUTER SERVICES (0.59%)
Computer Sciences /1/ 20,200 878,296
COMPUTERS (1.91%)
Hewlett-Packard 51,700 1,058,299
International Business Machines 23,000 1,756,740
2,815,039
COMPUTERS-INTEGRATED SYSTEMS (0.85%)
Dell /1/ 36,100 1,257,363
CONSULTING SERVICES (0.16%)
Accenture /1/ 11,106 241,000
CONSUMER PRODUCTS-MISCELLANEOUS (0.09%)
American Greetings 5,700 129,105
CONTAINERS-METAL & GLASS (0.13%)
Owens-Illinois /1/ 7,700 188,804
COSMETICS & TOILETRIES (2.77%)
Gillette 10,100 521,564
Procter & Gamble 65,990 3,573,358
4,094,922
DISTRIBUTION-WHOLESALE (0.25%)
Ingram Micro /1/ 22,500 374,850
DIVERSIFIED MANUFACTURING OPERATIONS (5.08%)
General Electric 138,083 4,998,605
ITT Industries 3,900 352,794
Tyco International 68,900 2,157,259
7,508,658
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (0.68%)
Cendant 50,500 1,005,455
ELECTRIC PRODUCTS-MISCELLANEOUS (0.73%)
Emerson Electric 17,100 1,071,657
ELECTRIC-INTEGRATED (1.85%)
Edison International 27,200 987,360
PG&E 46,700 1,621,424
Sierra Pacific Resources /1/ /2/ 11,400 123,348
2,732,132
ELECTRONIC COMPONENTS-SEMICONDUCTOR (2.52%)
Freescale Semiconductor /1/ 31,700 593,424
Freescale Semiconductor /1/ 33,451 630,886
Intel 89,868 2,113,695
Texas Instruments 15,500 386,880
3,724,885
ENTERPRISE SOFTWARE & SERVICE (0.09%)
BMC Software /1/ 6,200 100,440
Computer Associates International 1,100 29,590
130,030
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ENTERTAINMENT SOFTWARE (0.08%)
$
Electronic Arts /1/ 2,300 122,797
FIDUCIARY BANKS (0.23%)
State Street 7,500 346,725
FINANCE-AUTO LOANS (0.48%)
AmeriCredit /1/ 30,400 711,360
FINANCE-CREDIT CARD (0.20%)
American Express 5,700 300,390
FINANCE-INVESTMENT BANKER & BROKER (4.30%)
Bear Stearns 3,200 302,912
Citigroup 74,590 3,502,747
Lehman Brothers Holdings 2,800 256,816
Merrill Lynch 42,398 2,286,524
6,348,999
FINANCIAL GUARANTEE INSURANCE (0.61%)
MBIA 17,100 895,698
FOOD-CONFECTIONERY (0.21%)
Hershey 4,800 306,720
FOOD-FLOUR & GRAIN (0.56%)
Archer Daniels Midland 46,000 827,540
FOOD-MEAT PRODUCTS (0.55%)
Tyson Foods 48,100 812,409
FOOD-MISCELLANEOUS/DIVERSIFIED (0.19%)
Kraft Foods 8,900 288,449
FOOD-RETAIL (0.25%)
Albertson's /2/ 18,900 374,031
FOOD-WHOLESALE & DISTRIBUTION (0.31%)
Supervalu 14,400 454,464
GOLD MINING (0.06%)
Newmont Mining 2,300 87,331
HOTELS & MOTELS (0.24%)
Choice Hotels International 5,800 351,016
INDEPENDENT POWER PRODUCER (0.43%)
NRG Energy /1/ 20,500 637,550
INDUSTRIAL AUTOMATION & ROBOTS (0.22%)
Rockwell Automation 6,900 318,987
INDUSTRIAL GASES (0.32%)
Air Products & Chemicals 8,100 475,713
INTERNET SECURITY (0.15%)
Symantec /1/ 11,700 219,726
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.38%)
Franklin Resources 8,200 563,176
LIFE & HEALTH INSURANCE (0.35%)
Genworth Financial 10,000 279,500
UnumProvident 14,000 234,080
513,580
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MACHINERY-CONSTRUCTION & MINING (0.24%)
$
Caterpillar 3,960 348,678
MACHINERY-GENERAL INDUSTRY (0.28%)
Ingersoll-Rand 5,400 415,098
MACHINERY-PUMPS (0.07%)
Graco 2,900 97,933
MEDICAL INSTRUMENTS (0.79%)
Guidant 3,400 251,872
Medtronic 17,300 911,710
1,163,582
MEDICAL PRODUCTS (3.32%)
Baxter International 15,600 578,760
Becton Dickinson 12,600 737,352
Johnson & Johnson 45,800 3,143,254
Zimmer Holdings /1/ 5,400 439,668
4,899,034
MEDICAL-BIOMEDICAL/GENE (1.91%)
Amgen /1/ 38,726 2,254,240
Biogen Idec /1/ 4,000 144,960
Genzyme /1/ 7,100 416,131
2,815,331
MEDICAL-DRUGS (6.56%)
Abbott Laboratories 25,533 1,255,202
Allergan 10,200 717,978
Eli Lilly 16,233 949,144
Merck 39,900 1,352,610
Pfizer 135,650 3,685,610
Schering-Plough 41,600 868,192
Wyeth 19,232 864,286
9,693,022
MEDICAL-HMO (1.25%)
Aetna 14,200 1,041,854
UnitedHealth Group 2,200 207,922
WellPoint /1/ 4,700 600,425
1,850,201
MEDICAL-HOSPITALS (0.26%)
HCA 6,900 385,296
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.31%)
AmerisourceBergen 7,400 453,472
METAL-ALUMINUM (0.32%)
Alcoa 16,181 469,573
METAL-DIVERSIFIED (0.32%)
Rio Tinto 3,900 470,340
MISCELLANEOUS INVESTING (0.48%)
Equity Office Properties Trust 16,700 525,549
Prologis Trust 4,500 178,155
703,704
MONEY CENTER BANKS (4.32%)
Bank of America 94,118 4,239,075
JP Morgan Chase 60,260 2,138,627
6,377,702
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MULTI-LINE INSURANCE (3.27%)
$
American International Group 27,487 1,397,714
Cigna 1,200 110,376
Cincinnati Financial 2,940 118,306
Loews 13,300 942,704
MetLife 28,800 1,120,320
Prudential Financial 20,100 1,148,715
4,838,135
MULTIMEDIA (4.34%)
McGraw-Hill 1,500 130,620
Time Warner /1/ 170,519 2,866,424
Viacom 67,990 2,353,814
Walt Disney 40,300 1,063,920
6,414,778
NETWORKING PRODUCTS (0.95%)
Cisco Systems /1/ 81,519 1,408,648
OIL & GAS DRILLING (0.39%)
GlobalSantaFe 14,300 480,480
Transocean /1/ 2,100 97,377
577,857
OIL COMPANY-EXPLORATION & PRODUCTION (2.05%)
Anadarko Petroleum 13,800 1,007,952
Apache 6,700 377,143
Burlington Resources 21,200 1,030,532
Devon Energy 4,000 180,680
Noble Energy 6,700 429,604
3,025,911
OIL COMPANY-INTEGRATED (5.80%)
ChevronTexaco 6,300 327,600
ConocoPhillips 23,600 2,474,460
Exxon Mobil 72,291 4,122,756
Occidental Petroleum 23,800 1,642,200
8,567,016
OIL REFINING & MARKETING (0.21%)
Sunoco 3,200 317,632
OIL-FIELD SERVICES (0.54%)
Halliburton 16,700 694,553
Tidewater 2,800 96,516
791,069
PHARMACY SERVICES (0.40%)
Caremark Rx /1/ 14,800 592,740
PHOTO EQUIPMENT & SUPPLIES (0.23%)
Eastman Kodak 13,900 347,500
PROPERTY & CASUALTY INSURANCE (0.37%)
St. Paul 15,403 551,427
RECREATIONAL VEHICLES (0.48%)
Polaris Industries 12,300 707,988
REGIONAL BANKS (2.82%)
U.S. Bancorp 41,400 1,155,060
Wachovia 32,700 1,673,586
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
REGIONAL BANKS (CONTINUED)
$
Wells Fargo 22,200 1,330,668
4,159,314
RETAIL-AUTO PARTS (0.10%)
Autozone /1/ 1,800 149,400
RETAIL-AUTOMOBILE (0.59%)
AutoNation /1/ 48,000 876,960
RETAIL-BUILDING PRODUCTS (0.41%)
Lowe's 11,600 604,476
RETAIL-CONSUMER ELECTRONICS (0.24%)
Circuit City Stores 22,321 352,672
RETAIL-DISCOUNT (1.16%)
Target 9,200 426,880
Wal-Mart Stores 27,370 1,290,222
1,717,102
RETAIL-DRUG STORE (0.18%)
CVS 5,300 273,374
RETAIL-REGIONAL DEPARTMENT STORE (0.13%)
Dillard's 8,200 190,814
RETAIL-VARIETY STORE (0.07%)
99 Cents Only Stores /1/ 9,200 101,936
SAVINGS & LOANS-THRIFTS (0.78%)
Golden West Financial 3,500 218,155
Washington Mutual 22,800 942,096
1,160,251
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (0.26%)
Analog Devices 11,300 385,443
STEEL PRODUCERS (0.94%)
Nucor 15,500 792,050
United States Steel 14,000 598,640
1,390,690
TELECOMMUNICATION EQUIPMENT (0.95%)
Qualcomm 40,300 1,406,067
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.16%)
Corning /1/ 16,800 231,000
TELEPHONE-INTEGRATED (2.60%)
CenturyTel 27,600 847,044
SBC Communications 12,600 299,880
Sprint 29,900 665,574
Telephone & Data Systems 3,100 239,289
Verizon Communications 50,000 1,790,000
3,841,787
THERAPEUTICS (0.39%)
ImClone Systems /1/ 18,100 576,485
TOBACCO (2.17%)
Altria Group 23,800 1,546,762
Reynolds American 11,800 920,046
UST 16,000 732,800
3,199,608
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TRANSPORT-RAIL (1.19%)
$
Burlington Northern Santa Fe 19,100 921,575
Norfolk Southern 26,600 835,240
1,756,815
TRANSPORT-TRUCK (0.09%)
J.B. Hunt Transport Services 3,300 128,997
WEB PORTALS (1.49%)
Google /1/ 1,100 242,000
Yahoo /1/ 56,700 1,956,717
2,198,717
WIRELESS EQUIPMENT (0.15%)
Motorola 14,400 220,896
TOTAL COMMON STOCKS 147,277,818
Maturity
Amount Value
- ------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (0.35%)
Goldman Sachs; 2.80%; dated 04/29/05
maturing 05/02/05 (collateralized by U.S.
Treasury; $518,164; 05/15/16) /3/ $508,119 $ 508,000
TOTAL REPURCHASE AGREEMENTS 508,000
------------
TOTAL PORTFOLIO INVESTMENTS (100.04%) 147,785,818
LIABILITIES, NET OF CASH, RECEIVABLES, AND OTHER ASSETS
(-0.04%) (53,063)
TOTAL NET ASSETS (100.00%) $147,732,755
---------------
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS BLUE CHIP FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Contract Opening Current Unrealized
Type Commitment Market Value Market Value Gain(Loss)
- ---------------------------------------------------------------------
FUTURES CONTRACTS
4 S&P 500 eMini Buy $239,760 $231,700 $ (8,060)
June 2005
Futures
/1 /Non-income producing security.
/2 /Security or a portion of the security was on loan at the end of the period.
/3 /Security was purchased with the cash proceeds from securities loans.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 17,240,092
Unrealized Depreciation (16,443,427)
------------
Net Unrealized Appreciation (Depreciation) 796,665
Cost for federal income tax purposes $146,989,153
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- ------------------------------------------------------------------------------
$
Consumer, Non-cyclical 38,103,845 25.74%
Financial 28,675,003 19.37
Communications 19,275,079 13.02
Industrial 18,057,867 12.20
Technology 15,013,206 10.14
Energy 13,279,485 8.97
Consumer, Cyclical 7,961,126 5.38
Basic Materials 4,050,525 2.74
Utilities 3,369,682 2.28
Futures Contracts 231,700 0.16
TOTAL $148,017,518 100.00%
---------------- -----------
<FN>
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
</FN>
139
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS EQUITY GROWTH FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (98.93%)
AGRICULTURAL OPERATIONS (0.75%)
$
Monsanto 7,600 445,512
AIRLINES (0.78%)
Southwest Airlines 31,100 462,768
APPLICATIONS SOFTWARE (5.20%)
Mercury Interactive /1/ 9,400 388,502
Microsoft 87,100 2,203,630
Red Hat /1/ 45,200 485,900
3,078,032
BROADCASTING SERVICES & PROGRAMMING (1.23%)
Liberty Media /1/ 72,300 725,892
CABLE TV (2.11%)
Rogers Communications 43,400 1,248,184
CASINO SERVICES (1.89%)
International Game Technology 41,600 1,118,624
CELLULAR TELECOMMUNICATIONS (4.58%)
Nextel Communications /1/ 49,800 1,393,902
Nextel Partners /1/ 56,200 1,321,824
2,715,726
COMPUTERS (0.90%)
Research In Motion /1/ 8,300 534,603
COMPUTERS-INTEGRATED SYSTEMS (3.23%)
Dell /1/ 54,900 1,912,167
COMPUTERS-MEMORY DEVICES (1.68%)
EMC /1/ 75,700 993,184
CONSULTING SERVICES (1.61%)
Accenture /1/ 43,900 952,630
CRUISE LINES (1.77%)
Carnival 21,500 1,050,920
DATA PROCESSING & MANAGEMENT (1.01%)
Automatic Data Processing 13,800 599,472
DIVERSIFIED MANUFACTURING OPERATIONS (8.40%)
Danaher 28,400 1,437,892
General Electric 69,100 2,501,420
Tyco International 33,200 1,039,492
4,978,804
E-COMMERCE-SERVICES (1.89%)
eBay /1/ 14,600 463,258
InterActiveCorp /1/ 30,200 656,548
1,119,806
ELECTRONIC COMPONENTS-SEMICONDUCTOR (5.16%)
Intel 75,200 1,768,704
Xilinx 47,800 1,287,732
3,056,436
ENTERPRISE SOFTWARE & SERVICE (1.39%)
Oracle /1/ 71,000 820,760
ENTERTAINMENT SOFTWARE (0.28%)
Electronic Arts /1/ 3,100 165,509
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FIDUCIARY BANKS (2.54%)
$
State Street 32,500 1,502,475
FINANCE-CONSUMER LOANS (1.20%)
SLM 14,900 709,836
FINANCE-INVESTMENT BANKER & BROKER (3.80%)
Citigroup 36,900 1,732,824
Morgan Stanley 9,800 515,676
2,248,500
FOOD-WHOLESALE & DISTRIBUTION (1.83%)
Sysco 31,300 1,082,980
INTERNET BROKERS (1.42%)
Ameritrade Holding /1/ 80,200 840,496
INVESTMENT MANAGEMENT & ADVISORY SERVICES (1.80%)
Franklin Resources 15,500 1,064,540
MEDICAL INSTRUMENTS (1.75%)
Medtronic 19,700 1,038,190
MEDICAL-BIOMEDICAL/GENE (3.50%)
Amgen /1/ 14,100 820,761
Genentech /1/ 17,700 1,255,638
2,076,399
MEDICAL-HMO (6.63%)
UnitedHealth Group 24,000 2,268,240
WellPoint /1/ 13,000 1,660,750
3,928,990
MULTI-LINE INSURANCE (0.95%)
American International Group 11,100 564,435
MULTIMEDIA (1.16%)
E.W. Scripps 13,500 687,555
NETWORKING PRODUCTS (2.42%)
Cisco Systems /1/ 23,800 411,264
Juniper Networks /1/ 45,300 1,023,327
1,434,591
OIL & GAS DRILLING (1.43%)
Transocean /1/ 18,300 848,571
OIL-FIELD SERVICES (1.12%)
Schlumberger 9,700 663,577
PHARMACY SERVICES (0.26%)
Caremark Rx /1/ 3,800 152,190
RETAIL-DISCOUNT (4.43%)
Target 16,600 770,240
Wal-Mart Stores 39,400 1,857,316
2,627,556
RETAIL-DRUG STORE (1.55%)
Walgreen 21,300 917,178
RETAIL-PET FOOD & SUPPLIES (0.66%)
PETsMART 14,600 389,090
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-REGIONAL DEPARTMENT STORE (1.41%)
$
Kohl's /1/ 17,600 837,760
SCHOOLS (1.90%)
Apollo Group /1/ 15,600 1,125,072
SEMICONDUCTOR COMPONENT-INTEGRATED
CIRCUITS (4.68%)
Analog Devices 41,600 1,418,976
Marvell Technology Group /1/ 19,700 659,556
Maxim Integrated Products 18,600 695,640
2,774,172
TELECOMMUNICATION EQUIPMENT (0.26%)
Qualcomm 4,500 157,005
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (2.15%)
Corning /1/ 92,700 1,274,625
THERAPEUTICS (2.19%)
Gilead Sciences /1/ 34,900 1,294,790
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS EQUITY GROWTH FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
WEB PORTALS (4.03%)
Google /1/ 4,000 $ 880,000
Yahoo /1/ 43,700 1,508,087
2,388,087
TOTAL COMMON STOCKS 58,607,689
-----------
TOTAL PORTFOLIO INVESTMENTS (98.93%) 58,607,689
CASH, RECEIVABLES AND OTHER ASSETS, NET OF
LIABILITIES (1.07%) 635,907
TOTAL NET ASSETS (100.00%) $59,243,596
-------------
/1 /Non-income producing security.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 4,580,504
Unrealized Depreciation (7,877,305)
-----------
Net Unrealized Appreciation (Depreciation) (3,296,801)
Cost for federal income tax purposes $61,904,490
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
Technology $13,934,335 23.78%
Consumer,
Non-cyclical 12,096,753 20.64
Communications 11,751,471 20.05
Consumer, Cyclical 7,403,896 12.63
Financial 6,930,282 11.82
Industrial 4,978,804 8.50
Energy 1,512,148 2.58
TOTAL $58,607,689 100.00%
---------------- ------------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (99.10%)
ADVERTISING AGENCIES (0.16%)
$
Omnicom Group 1,300 107,770
AEROSPACE & DEFENSE (0.67%)
Boeing 5,100 303,552
Rockwell Collins 3,600 165,168
468,720
AEROSPACE & DEFENSE EQUIPMENT (1.12%)
General Dynamics 2,600 273,130
Goodrich 2,200 88,660
Lockheed Martin 2,600 158,470
United Technologies 2,600 264,472
784,732
AGRICULTURAL CHEMICALS (0.11%)
Mosaic /1/ 2,900 37,265
Potash Corp. of Saskatchewan 500 42,070
79,335
AGRICULTURAL OPERATIONS (0.16%)
Monsanto 1,900 111,378
AIRLINES (0.10%)
Southwest Airlines 4,500 66,960
APPLICATIONS SOFTWARE (2.61%)
Mercury Interactive /1/ 400 16,532
Microsoft 67,000 1,695,100
Red Hat /1/ 10,300 110,725
1,822,357
ATHLETIC FOOTWEAR (0.15%)
Nike 1,400 107,534
AUDIO & VIDEO PRODUCTS (0.05%)
Digital Theater Systems /1/ 2,000 33,800
AUTO-CARS & LIGHT TRUCKS (0.41%)
General Motors 10,600 282,808
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.15%)
Paccar 1,500 101,850
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.19%)
TRW Automotive Holdings /1/ 7,500 133,575
BEVERAGES-NON-ALCOHOLIC (2.24%)
Coca-Cola 17,300 751,512
Coca-Cola Enterprises 3,100 62,930
Cott /1/ 4,000 89,560
Pepsico 11,900 662,116
1,566,118
BREWERY (0.28%)
Anheuser-Busch 4,200 196,854
BROADCASTING SERVICES & PROGRAMMING (0.24%)
Liberty Media /1/ 16,800 168,672
BUILDING-MAINTENANCE & SERVICE (0.20%)
Ecolab 4,200 137,382
CABLE TV (0.96%)
Comcast /1/ 15,400 494,494
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
CABLE TV (CONTINUED)
$
Rogers Communications 6,100 175,436
669,930
CASINO HOTELS (0.12%)
Harrah's Entertainment 1,300 85,306
CASINO SERVICES (0.41%)
International Game Technology 10,600 285,034
CELLULAR TELECOMMUNICATIONS (0.47%)
Nextel Communications /1/ 5,700 159,543
Nextel Partners /1/ 7,200 169,344
328,887
CHEMICALS-DIVERSIFIED (0.65%)
Dow Chemical 1,700 78,081
E. I. Du Pont de Nemours 8,000 376,880
454,961
CHEMICALS-SPECIALTY (0.34%)
Cabot 1,600 48,880
Ferro 1,500 27,180
Minerals Technologies 400 26,128
Sigma-Aldrich 2,300 134,389
236,577
CIRCUIT BOARDS (0.32%)
Jabil Circuit /1/ 8,000 220,800
COMMERCIAL BANKS (0.59%)
First Horizon National 3,200 132,896
Synovus Financial 10,000 280,300
413,196
COMMERCIAL SERVICE-FINANCE (0.17%)
Moody's 1,400 114,996
COMPUTERS (1.17%)
Gateway /1/ 9,000 30,690
Hewlett-Packard 9,000 184,230
International Business Machines 6,300 481,194
Research In Motion /1/ 1,900 122,379
818,493
COMPUTERS-INTEGRATED SYSTEMS (1.56%)
Dell /1/ 31,200 1,086,696
COMPUTERS-MEMORY DEVICES (0.45%)
EMC /1/ 23,800 312,256
COMPUTERS-PERIPHERAL EQUIPMENT (0.04%)
Lexmark International /1/ 400 27,780
CONSULTING SERVICES (0.25%)
Accenture /1/ 7,900 171,430
COSMETICS & TOILETRIES (2.57%)
Colgate-Palmolive 4,200 209,118
Gillette 7,100 366,644
Kimberly-Clark 2,500 156,125
Procter & Gamble 19,600 1,061,340
1,793,227
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
CRUISE LINES (0.55%)
$
Carnival 5,500 268,840
Royal Caribbean Cruises 2,800 117,656
386,496
DATA PROCESSING & MANAGEMENT (0.96%)
Automatic Data Processing 5,700 247,608
First Data 5,400 205,362
Fiserv /1/ 800 33,840
VERITAS Software /1/ 9,000 185,310
672,120
DECISION SUPPORT SOFTWARE (0.11%)
NetIQ /1/ 7,100 76,112
DISPOSABLE MEDICAL PRODUCTS (0.12%)
C.R. Bard 1,200 85,404
DISTRIBUTION-WHOLESALE (0.18%)
CDW 2,300 125,787
DIVERSIFIED MANUFACTURING OPERATIONS (7.25%)
3M 5,700 435,879
Danaher 8,700 440,481
General Electric 76,400 2,765,680
Honeywell International 13,200 472,032
Illinois Tool Works 800 67,056
Roper Industries 1,000 67,670
Teleflex 1,300 69,511
Tyco International 23,800 745,178
5,063,487
DIVERSIFIED OPERATORS-COMMERCIAL
SERVICES (0.28%)
Cendant 9,700 193,127
E-COMMERCE-SERVICES (0.34%)
eBay /1/ 4,300 136,439
InterActiveCorp /1/ 4,700 102,178
238,617
ELECTRIC-GENERATION (0.11%)
AES /1/ 4,800 77,184
ELECTRIC-INTEGRATED (3.15%)
Black Hills 600 20,568
CMS Energy /1/ 4,800 62,016
Constellation Energy Group 1,700 89,352
Dominion Resources 2,100 158,340
Duke Energy 11,700 341,523
Edison International 4,800 174,240
Entergy 1,600 117,280
Exelon 6,800 336,600
FirstEnergy 4,300 187,136
NiSource 5,000 116,200
Pinnacle West Capital 2,700 113,130
PPL 2,600 141,076
Southern 1,200 39,540
TECO Energy 6,500 107,965
TXU 1,800 154,422
Xcel Energy 2,500 42,950
2,202,338
Shares
Held Value
- ------------------------------------------------------------------------------------------
OMMON STOCKS (CONTINUED)
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.12%)
$
Flextronics International /1/ 7,200 80,280
ELECTRONIC COMPONENTS-SEMICONDUCTOR (2.21%)
Intel 49,800 1,171,296
National Semiconductor 10,100 192,708
Xilinx 6,600 177,804
1,541,808
ENTERPRISE SOFTWARE & SERVICE (0.58%)
Oracle /1/ 34,800 402,288
ENTERTAINMENT SOFTWARE (0.10%)
Electronic Arts /1/ 1,300 69,407
FIDUCIARY BANKS (0.81%)
Investors Financial Services 2,700 113,265
State Street 9,800 453,054
566,319
FILTRATION & SEPARATION PRODUCTS (0.09%)
Pall 2,400 64,392
FINANCE-COMMERCIAL (0.15%)
CapitalSource /1/ 5,000 105,000
FINANCE-CONSUMER LOANS (0.33%)
First Marblehead /1/ 1,700 65,501
SLM 3,400 161,976
227,477
FINANCE-CREDIT CARD (0.70%)
American Express 7,400 389,980
Providian Financial /1/ 6,100 101,687
491,667
FINANCE-INVESTMENT BANKER & BROKER (5.41%)
Charles Schwab 11,200 115,920
Citigroup 47,000 2,207,120
E*Trade Financial /1/ 12,000 133,320
Goldman Sachs Group 3,400 363,086
Legg Mason 650 46,059
Lehman Brothers Holdings 1,900 174,268
Merrill Lynch 6,700 361,331
Morgan Stanley 7,200 378,864
3,779,968
FINANCE-MORTGAGE LOAN/BANKER (0.68%)
Countrywide Financial 2,900 104,951
Federal National Mortgage Association 6,800 366,860
471,811
FINANCIAL GUARANTEE INSURANCE (0.15%)
Radian Group 2,400 106,632
FOOD-CONFECTIONERY (0.15%)
Hershey 1,600 102,240
FOOD-MISCELLANEOUS/DIVERSIFIED (0.76%)
Campbell Soup 3,900 115,986
General Mills 4,700 232,180
H.J. Heinz 1,900 70,015
Kellogg 2,500 112,375
530,556
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FOOD-RETAIL (0.09%)
$
Kroger /1/ 3,900 61,503
FOOD-WHOLESALE & DISTRIBUTION (0.21%)
Sysco 4,300 148,780
GOLD MINING (0.06%)
Newmont Mining 1,100 41,767
HOME DECORATION PRODUCTS (0.04%)
Newell Rubbermaid 1,400 30,422
HOTELS & MOTELS (0.27%)
Marriott International 3,000 188,250
HUMAN RESOURCES (0.05%)
Robert Half International 1,500 37,230
INDUSTRIAL GASES (0.15%)
Praxair 2,300 107,709
INSTRUMENTS-SCIENTIFIC (0.04%)
Waters /1/ 700 27,741
INSURANCE BROKERS (0.53%)
Marsh & McLennan 8,100 227,043
Willis Group Holdings 4,300 143,835
370,878
INTERNET APPLICATION SOFTWARE (0.05%)
MatrixOne /1/ 7,500 32,025
INTERNET BROKERS (0.48%)
Ameritrade Holding /1/ 31,900 334,312
INTERNET CONTENT-INFORMATION & NEWS (0.21%)
CNET Networks /1/ 14,900 147,733
INTERNET SECURITY (0.14%)
McAfee /1/ 4,700 98,277
INVESTMENT MANAGEMENT & ADVISORY
SERVICES (0.20%)
Franklin Resources 2,000 137,360
LEISURE & RECREATION PRODUCTS (0.36%)
Brunswick 3,300 138,600
WMS Industries /1/ 4,300 109,220
247,820
LIFE & HEALTH INSURANCE (0.34%)
Aflac 3,700 150,405
Genworth Financial 3,200 89,440
239,845
LINEN SUPPLY & RELATED ITEMS (0.06%)
Cintas 1,000 38,590
MACHINERY-FARM (0.37%)
Deere 4,100 256,414
MEDICAL INSTRUMENTS (1.58%)
Biomet 1,800 69,642
Boston Scientific /1/ 6,100 180,438
Guidant 2,300 170,384
Medtronic 10,300 542,810
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL INSTRUMENTS (CONTINUED)
$
St. Jude Medical /1/ 3,500 136,605
1,099,879
MEDICAL LABORATORY & TESTING SERVICE (0.15%)
Laboratory Corp. of America Holdings /1/ 1,300 64,350
Quest Diagnostics 400 42,320
106,670
MEDICAL PRODUCTS (2.71%)
Baxter International 5,600 207,760
Johnson & Johnson 20,500 1,406,915
Stryker 3,200 155,360
Zimmer Holdings /1/ 1,500 122,130
1,892,165
MEDICAL-BIOMEDICAL/GENE (1.29%)
Amgen /1/ 9,300 541,353
Biogen Idec /1/ 2,800 101,472
Celgene /1/ 1,900 72,029
Chiron /1/ 500 17,075
Genentech /1/ 2,000 141,880
Genzyme /1/ 400 23,444
897,253
MEDICAL-DRUGS (4.78%)
Abbott Laboratories 9,600 471,936
Bristol-Myers Squibb 2,300 59,800
Cephalon /1/ 600 26,340
Elan /1/ 2,700 14,877
Eli Lilly 7,800 456,066
Merck 12,800 433,920
Pfizer 46,100 1,252,537
Schering-Plough 9,300 194,091
Wyeth 9,600 431,424
3,340,991
MEDICAL-GENERIC DRUGS (0.05%)
Watson Pharmaceutical /1/ 1,100 33,000
MEDICAL-HMO (1.47%)
UnitedHealth Group 5,700 538,707
WellPoint /1/ 3,800 485,450
1,024,157
MEDICAL-HOSPITALS (0.34%)
Community Health Systems /1/ 3,400 123,930
HCA 1,600 89,344
Health Management Associates 1,000 24,730
238,004
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.34%)
AmerisourceBergen 700 42,896
Cardinal Health 3,500 194,495
237,391
METAL-ALUMINUM (0.34%)
Alcoa 8,200 237,964
MISCELLANEOUS INVESTING (0.50%)
Archstone-Smith Trust 3,600 129,492
Equity Office Properties Trust 3,600 113,292
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MISCELLANEOUS INVESTING (CONTINUED)
$
Simon Property Group 1,600 105,712
348,496
MONEY CENTER BANKS (2.30%)
Bank of America 19,842 893,684
JP Morgan Chase 20,088 712,923
1,606,607
MULTI-LINE INSURANCE (2.50%)
American International Group 19,500 991,575
Assurant 2,500 82,725
Hartford Financial Services Group 2,900 209,873
Prudential Financial 4,300 245,745
Safeco 3,100 163,277
XL Capital 700 49,210
1,742,405
MULTIMEDIA (2.36%)
E.W. Scripps 800 40,744
Gannett 1,700 130,900
McGraw-Hill 1,100 95,788
Meredith 1,000 47,000
News 17,600 268,928
Time Warner /1/ 36,400 611,884
Viacom 13,100 453,522
1,648,766
NETWORKING PRODUCTS (1.19%)
Cisco Systems /1/ 43,800 756,864
Juniper Networks /1/ 3,400 76,806
833,670
NON-HAZARDOUS WASTE DISPOSAL (0.23%)
Allied Waste Industries /1/ 2,500 19,975
Republic Services 3,000 103,800
Waste Management 1,300 37,037
160,812
OFFICE AUTOMATION & EQUIPMENT (0.08%)
Pitney Bowes 1,300 58,136
OFFICE SUPPLIES & FORMS (0.22%)
Avery Dennison 2,900 151,815
OIL & GAS DRILLING (0.29%)
Nabors Industries /1/ 1,000 53,870
Transocean /1/ 3,200 148,384
202,254
OIL COMPANY-EXPLORATION & PRODUCTION (0.81%)
Anadarko Petroleum 1,500 109,560
Devon Energy 1,800 81,306
EOG Resources 2,600 123,630
Murphy Oil 1,700 151,453
XTO Energy 3,233 97,540
563,489
OIL COMPANY-INTEGRATED (5.65%)
ChevronTexaco 15,000 780,000
ConocoPhillips 4,200 440,370
Exxon Mobil 42,900 2,446,587
Occidental Petroleum 1,800 124,200
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL COMPANY-INTEGRATED (CONTINUED)
$
Total 1,400 155,274
3,946,431
OIL FIELD MACHINERY & EQUIPMENT (0.35%)
FMC Technologies /1/ 1,700 51,561
Grant Prideco /1/ 6,900 153,042
National-Oilwell Varco /1/ 1,000 39,740
244,343
OIL REFINING & MARKETING (0.06%)
Sunoco 400 39,704
OIL-FIELD SERVICES (0.95%)
Baker Hughes 3,200 141,184
BJ Services 1,700 82,875
Schlumberger 6,400 437,824
661,883
OPTICAL SUPPLIES (0.13%)
Bausch & Lomb 1,200 90,000
PAPER & RELATED PRODUCTS (0.63%)
Bowater 700 22,743
International Paper 5,600 192,024
MeadWestvaco 2,200 64,790
Potlatch 1,400 66,122
Weyerhaeuser 1,400 96,054
441,733
PHARMACY SERVICES (0.22%)
Caremark Rx /1/ 2,800 112,140
Medco Health Solutions /1/ 800 40,776
152,916
PIPELINES (0.35%)
Dynegy /1/ 6,800 22,780
Williams 13,100 222,962
245,742
PROPERTY & CASUALTY INSURANCE (0.94%)
ACE 3,000 128,880
Progressive 2,700 246,429
St. Paul 7,902 282,892
658,201
PUBLISHING-NEWSPAPERS (0.29%)
Dow Jones 1,000 33,440
Tribune 2,200 84,920
Washington Post 100 86,425
204,785
REGIONAL BANKS (3.17%)
Fifth Third Bancorp 8,000 348,000
SunTrust Banks 2,300 167,509
U.S. Bancorp 21,800 608,220
Wachovia 10,400 532,272
Wells Fargo 9,300 557,442
2,213,443
REINSURANCE (0.17%)
AXIS Capital Holdings 4,500 119,700
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-APPAREL & SHOE (0.40%)
$
Hot Topic /1/ 6,500 129,935
Ross Stores 5,700 152,304
282,239
RETAIL-AUTO PARTS (0.11%)
O'Reilly Automotive /1/ 1,500 76,980
RETAIL-BUILDING PRODUCTS (1.06%)
Home Depot 14,500 512,865
Lowe's 4,400 229,284
742,149
RETAIL-CONSUMER ELECTRONICS (0.19%)
Best Buy 2,600 130,884
RETAIL-DISCOUNT (2.61%)
Family Dollar Stores 5,300 142,994
Target 8,200 380,480
TJX 3,700 83,805
Wal-Mart Stores 25,800 1,216,212
1,823,491
RETAIL-DRUG STORE (0.70%)
CVS 2,900 149,582
Walgreen 7,900 340,174
489,756
RETAIL-OFFICE SUPPLIES (0.10%)
Staples 3,750 71,512
RETAIL-REGIONAL DEPARTMENT STORE (0.57%)
Kohl's /1/ 8,400 399,840
RETAIL-RESTAURANTS (0.78%)
McDonald's 7,400 216,894
Outback Steakhouse 3,000 121,200
Panera Bread /1/ 2,600 130,052
Yum! Brands 1,600 75,136
543,282
SCHOOLS (0.10%)
Apollo Group /1/ 1,000 72,120
SEMICONDUCTOR COMPONENT-INTEGRATED
CIRCUITS (0.55%)
Analog Devices 7,800 266,058
Linear Technology 3,200 114,368
380,426
SEMICONDUCTOR EQUIPMENT (0.39%)
Applied Materials /1/ 1,200 17,844
ASM Lithography Holding /1/ 8,700 126,063
Kla-Tencor /1/ 2,100 81,942
Novellus Systems /1/ 1,900 44,517
270,366
TELECOMMUNICATION EQUIPMENT (0.54%)
Comverse Technology /1/ 2,200 50,138
Qualcomm 9,400 327,966
378,104
TELECOMMUNICATION EQUIPMENT-FIBER
OPTICS (0.23%)
Corning /1/ 11,600 159,500
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TELECOMMUNICATION SERVICES (0.47%)
$
Telus 11,100 331,113
TELEPHONE-INTEGRATED (1.42%)
Sprint 22,800 507,528
Verizon Communications 13,500 483,300
990,828
TELEVISION (0.20%)
Univision Communications /1/ 5,300 139,337
THERAPEUTICS (0.25%)
Gilead Sciences /1/ 4,600 170,660
TOBACCO (1.56%)
Altria Group 16,800 1,091,832
TOYS (0.13%)
Hasbro 1,700 32,164
Mattel 3,100 55,955
88,119
TRANSPORT-RAIL (0.60%)
CSX 6,200 248,806
Union Pacific 2,700 172,611
421,417
TRANSPORT-SERVICES (0.52%)
FedEx 1,200 101,940
United Parcel Service 3,700 263,847
365,787
WEB PORTALS (0.63%)
Yahoo /1/ 12,800 441,728
WIRELESS EQUIPMENT (0.70%)
Crown Castle International /1/ 10,400 167,752
Motorola 17,100 262,314
Nokia 3,700 59,126
489,192
TOTAL COMMON STOCKS 69,190,054
Principal
Amount Value
- ------------------------------------------------------------------------------------------
TREASURY BONDS (0.07%)
U.S. Treasury /2/
$ $
2.62%; 05/26/05 50,000 49,913
TOTAL TREASURY BONDS 49,913
-----------
TOTAL PORTFOLIO INVESTMENTS (99.17%) 69,239,967
CASH, RECEIVABLES AND OTHER ASSETS, NET OF LIABILITIES (0.83%) 580,991
TOTAL NET ASSETS (100.00%) $69,820,958
-------------
Contract Opening Current Unrealized
Type Commitment Market Value Market Value Gain(Loss)
- ----------------------------------------------------------------------
FUTURES CONTRACTS
10 S&P 500 eMini Buy $607,295 $579,250 $(28,045)
June 2005
Futures
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
APRIL 30, 2005 (UNAUDITED)
/1 /Non-income producing security.
/2 /Security or a portion of the security was pledged to cover margin
requirements for futures contracts. At the end of the period, the value of
these securities totaled $49,913 or 0.07% of net assets.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 7,156,191
Unrealized Depreciation (3,649,538)
-----------
Net Unrealized Appreciation (Depreciation) 3,506,653
Cost for federal income tax purposes $65,733,314
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
Consumer,
Non-cyclical $15,669,376 22.44%
Financial 13,566,456 19.43
Industrial 7,914,582 11.33
Technology 7,538,245 10.80
Communications 7,408,934 10.61
Consumer, Cyclical 6,804,805 9.75
Energy 5,903,846 8.46
Utilities 2,279,522 3.26
Basic Materials 1,737,428 2.49
Futures Contracts 579,250 0.83
Government 416,773 0.60
TOTAL $69,819,217 100.00%
---------------- ------------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
147
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS LARGECAP VALUE FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ----------------------------------------------------------------------------------------
COMMON STOCKS (98.48%)
ADVERTISING AGENCIES (0.49%)
$
Interpublic Group /1/ 26,300 338,218
AEROSPACE & DEFENSE (0.73%)
Boeing 7,300 434,496
Northrop Grumman 1,300 71,292
505,788
AEROSPACE & DEFENSE EQUIPMENT (0.83%)
General Dynamics 1,700 178,585
Goodrich 9,775 393,933
572,518
AGRICULTURAL OPERATIONS (0.49%)
Bunge 5,900 335,120
APPAREL MANUFACTURERS (0.70%)
Jones Apparel Group 9,050 275,573
VF 3,600 203,724
479,297
APPLICATIONS SOFTWARE (1.26%)
Microsoft 34,300 867,790
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (1.39%)
American Axle & Manufacturing Holdings 4,600 91,816
Autoliv 3,900 172,575
BorgWarner 4,800 219,456
Dana 9,900 113,058
Lear 3,700 125,393
Magna International 3,800 232,294
954,592
BEVERAGES-NON-ALCOHOLIC (0.14%)
Pepsico 1,700 94,588
BREWERY (0.12%)
Molson Coors Brewing 1,300 80,275
BUILDING & CONSTRUCTION PRODUCTS-
MISCELLANEOUS (0.86%)
Masco 8,000 251,920
Vulcan Materials 6,400 339,456
591,376
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.29%)
Martin Marietta Materials 3,600 197,964
CABLE TV (1.36%)
Comcast /1/ 29,100 934,401
CHEMICALS-DIVERSIFIED (1.02%)
Dow Chemical 1,500 68,895
E. I. Du Pont de Nemours 3,900 183,729
PPG Industries 6,700 452,585
705,209
CHEMICALS-SPECIALTY (0.56%)
Eastman Chemical 7,100 383,400
COMMERCIAL BANKS (0.35%)
BB&T 6,100 239,181
COMPUTER SERVICES (0.65%)
Electronic Data Systems 23,300 450,855
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMPUTERS (1.75%)
$
Hewlett-Packard 49,000 1,003,030
International Business Machines 2,600 198,588
1,201,618
COMPUTERS-MEMORY DEVICES (0.09%)
Storage Technology /1/ 2,200 61,160
CONTAINERS-METAL & GLASS (0.07%)
Owens-Illinois /1/ 2,000 49,040
CONTAINERS-PAPER & PLASTIC (0.25%)
Smurfit-Stone Container /1/ 12,900 169,119
DISTRIBUTION-WHOLESALE (0.39%)
Ingram Micro /1/ 8,700 144,942
Tech Data /1/ 3,300 120,549
265,491
DIVERSIFIED MANUFACTURING OPERATIONS (8.21%)
Cooper Industries 3,800 241,908
Crane 4,400 112,640
Eaton 6,200 363,940
General Electric 97,200 3,518,640
Honeywell International 16,200 579,312
SPX 6,300 243,747
Textron 6,300 474,705
Tyco International 3,600 112,716
5,647,608
ELECTRIC-INTEGRATED (3.68%)
Alliant Energy 9,300 244,962
American Electric Power 12,750 449,055
Constellation Energy Group 4,500 236,520
Edison International 2,600 94,380
Entergy 7,500 549,750
FirstEnergy 11,900 517,888
Northeast Utilities 10,900 199,579
Xcel Energy 14,000 240,520
2,532,654
ELECTRONIC COMPONENTS-MISCELLANEOUS (1.22%)
Flextronics International /1/ 31,800 354,570
Sanmina /1/ 53,300 213,733
Solectron /1/ 40,200 132,660
Vishay Intertechnology /1/ 13,200 141,108
842,071
FIDUCIARY BANKS (0.55%)
Mellon Financial 13,600 376,584
FINANCE-INVESTMENT BANKER & BROKER (7.80%)
Citigroup 65,900 3,094,664
Goldman Sachs Group 4,500 480,555
Lehman Brothers Holdings 6,250 573,250
Merrill Lynch 9,500 512,335
Morgan Stanley 13,500 710,370
5,371,174
FINANCE-MORTGAGE LOAN/BANKER (2.48%)
Countrywide Financial 16,100 582,659
Federal Home Loan Mortgage 12,900 793,608
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-MORTGAGE LOAN/BANKER (CONTINUED)
$
Federal National Mortgage Association 6,125 330,445
1,706,712
FINANCIAL GUARANTEE INSURANCE (0.79%)
MBIA 5,100 267,138
MGIC Investment 4,700 277,300
544,438
FOOD-FLOUR & GRAIN (0.20%)
Archer Daniels Midland 7,800 140,322
FOOD-MISCELLANEOUS/DIVERSIFIED (1.20%)
Kellogg 2,900 130,355
Sara Lee 18,000 385,020
Unilever 4,800 309,264
824,639
FOOD-RETAIL (1.29%)
Kroger /1/ 27,200 428,944
Safeway /1/ 21,600 459,864
888,808
FOOD-WHOLESALE & DISTRIBUTION (0.40%)
Supervalu 8,700 274,572
GAS-DISTRIBUTION (0.64%)
Sempra Energy 11,000 444,180
HOME DECORATION PRODUCTS (0.51%)
Newell Rubbermaid 16,100 349,853
LIFE & HEALTH INSURANCE (0.60%)
Genworth Financial 12,500 349,375
Torchmark 1,225 65,452
414,827
MACHINERY-GENERAL INDUSTRY (0.18%)
Ingersoll-Rand 1,600 122,992
MEDICAL LABORATORY & TESTING SERVICE (0.50%)
Laboratory Corp. of America Holdings /1/ 7,000 346,500
MEDICAL-DRUGS (1.43%)
Bristol-Myers Squibb 4,500 117,000
Eli Lilly 6,700 391,749
Merck 13,950 472,905
981,654
MEDICAL-HOSPITALS (0.25%)
HCA 3,100 173,104
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.33%)
AmerisourceBergen 3,700 226,736
METAL-ALUMINUM (0.23%)
Alcoa 5,400 156,708
MONEY CENTER BANKS (4.91%)
Bank of America 51,866 2,336,045
JP Morgan Chase 29,400 1,043,406
3,379,451
MULTI-LINE INSURANCE (4.15%)
Allstate 12,500 702,000
American International Group 3,800 193,230
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MULTI-LINE INSURANCE (CONTINUED)
$
Hartford Financial Services Group 8,500 615,145
MetLife 10,850 422,065
Prudential Financial 11,000 628,650
XL Capital 4,200 295,260
2,856,350
MULTIMEDIA (1.59%)
Time Warner /1/ 55,200 927,912
Viacom 2,500 86,550
Walt Disney 3,100 81,840
1,096,302
OIL & GAS DRILLING (0.48%)
GlobalSantaFe 9,800 329,280
OIL COMPANY-INTEGRATED (11.28%)
BP Amoco 5,300 322,770
ChevronTexaco 22,850 1,188,200
ConocoPhillips 10,897 1,142,550
Exxon Mobil 67,100 3,826,713
Marathon Oil 12,300 572,811
Occidental Petroleum 10,300 710,700
7,763,744
PAPER & RELATED PRODUCTS (1.89%)
Georgia-Pacific 12,550 430,088
International Paper 15,500 531,495
Temple-Inland 10,000 337,500
1,299,083
PHARMACY SERVICES (0.84%)
Medco Health Solutions /1/ 11,400 581,058
PHOTO EQUIPMENT & SUPPLIES (0.49%)
Eastman Kodak 13,400 335,000
POWER CONVERTER & SUPPLY EQUIPMENT (0.32%)
Hubbell 5,000 217,250
PROPERTY & CASUALTY INSURANCE (1.66%)
ACE 2,800 120,288
Chubb 5,550 453,879
St. Paul 15,836 566,929
1,141,096
REGIONAL BANKS (7.46%)
Comerica 7,700 440,902
Huntington Bancshares 17,700 416,127
KeyCorp 11,550 382,998
National City 16,450 558,642
PNC Financial Services Group 7,300 388,579
SunTrust Banks 7,800 568,074
U.S. Bancorp 20,597 574,656
Wachovia 23,504 1,202,935
Wells Fargo 10,050 602,397
5,135,310
RETAIL-APPAREL & SHOE (0.85%)
Limited 18,700 405,603
Nordstrom 3,600 182,988
588,591
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-DISCOUNT (0.42%)
$
Target 6,200 287,680
RETAIL-OFFICE SUPPLIES (0.56%)
Office Depot /1/ 19,600 383,768
RETAIL-REGIONAL DEPARTMENT STORE (0.58%)
Federated Department Stores 6,900 396,750
RETAIL-RESTAURANTS (1.00%)
McDonald's 23,500 688,785
RUBBER-TIRES (0.09%)
Cooper Tire & Rubber 3,500 61,075
SAVINGS & LOANS-THRIFTS (1.47%)
Astoria Financial 9,750 258,472
Washington Mutual 18,287 755,619
1,014,091
STEEL PRODUCERS (0.69%)
United States Steel 11,100 474,636
TELECOMMUNICATION EQUIPMENT (0.93%)
ADC Telecommunications /1/ 79,300 180,011
Nortel Networks /1/ 72,100 179,529
Tellabs /1/ 36,500 283,240
642,780
TELECOMMUNICATION EQUIPMENT-FIBER
OPTICS (0.69%)
Corning /1/ 34,500 474,375
TELEPHONE-INTEGRATED (4.23%)
BellSouth 6,100 161,589
SBC Communications 21,800 518,840
Sprint 36,000 801,360
Verizon Communications 40,000 1,432,000
2,913,789
TOBACCO (3.35%)
Altria Group 28,550 1,855,464
UST 9,900 453,420
2,308,884
TOYS (0.29%)
Mattel 11,000 198,550
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS LARGECAP VALUE FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TRANSPORT-RAIL (1.98%)
Burlington Northern Santa Fe 9,050 $ 436,662
CSX 10,400 417,352
Norfolk Southern 16,100 505,540
1,359,554
TOTAL COMMON STOCKS 67,770,368
-----------
TOTAL PORTFOLIO INVESTMENTS (98.48%) 67,770,368
CASH, RECEIVABLES AND OTHER ASSETS, NET OF
LIABILITIES (1.52%) 1,044,596
TOTAL NET ASSETS (100.00%) $68,814,964
--------------
/1 /Non-income producing security.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $11,493,594
Unrealized Depreciation (3,045,772)
-----------
Net Unrealized Appreciation (Depreciation) 8,447,822
Cost for federal income tax purposes $59,322,545
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
Financial $21,055,161 31.07%
Industrial 10,610,280 15.66
Energy 8,093,024 11.94
Consumer,
Non-cyclical 7,256,260 10.71
Communications 6,399,865 9.44
Consumer, Cyclical 4,654,432 6.87
Basic Materials 3,019,037 4.45
Utilities 2,976,834 4.39
Technology 2,581,423 3.81
Government 1,124,052 1.66
TOTAL $67,770,368 100.00%
---------------- ------------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
150
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS MIDCAP GROWTH FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (98.85%)
ADVERTISING SERVICES (0.49%)
$
Getty Images /1/ 2,210 158,126
AEROSPACE & DEFENSE EQUIPMENT (0.65%)
Goodrich 5,220 210,366
AIRLINES (0.72%)
Southwest Airlines 15,700 233,616
APPAREL MANUFACTURERS (1.77%)
Coach /1/ 21,520 576,736
APPLICATIONS SOFTWARE (1.89%)
Citrix Systems /1/ 12,520 281,700
Mercury Interactive /1/ 8,040 332,293
613,993
BEVERAGES-WINE & SPIRITS (0.76%)
Constellation Brands /1/ 4,700 247,737
CASINO HOTELS (2.62%)
MGM Mirage /1/ 5,490 383,257
Station Casinos 4,250 274,252
Wynn Resorts /1/ 3,700 195,878
853,387
CASINO SERVICES (0.62%)
Scientific Games /1/ 9,370 201,174
CELLULAR TELECOMMUNICATIONS (2.11%)
Alamosa Holdings /1/ 23,040 299,290
Nextel Partners /1/ 6,720 158,054
NII Holdings /1/ 4,550 227,818
685,162
CHEMICALS-DIVERSIFIED (0.52%)
Lyondell Chemical 6,710 168,354
COAL (0.57%)
Peabody Energy 4,270 186,898
COMMERCIAL BANKS (1.43%)
City National 2,830 199,515
Silicon Valley Bancshares /1/ 5,590 264,966
464,481
COMMERCIAL SERVICES (1.08%)
Alliance Data Systems /1/ 8,660 349,864
COMMUNICATIONS SOFTWARE (1.27%)
Avid Technology /1/ 8,350 413,408
COMPUTER SERVICES (1.23%)
Cognizant Technology Solutions /1/ 9,490 398,675
COMPUTERS (2.04%)
Apple Computer /1/ 18,390 663,143
CONSUMER PRODUCTS-MISCELLANEOUS (2.15%)
Clorox 4,180 264,594
Fortune Brands 5,150 435,587
700,181
CONTAINERS-METAL & GLASS (0.53%)
Owens-Illinois /1/ 7,080 173,602
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DATA PROCESSING & MANAGEMENT (1.51%)
$
Global Payments 4,510 292,068
SEI Investments 6,110 200,469
492,537
DECISION SUPPORT SOFTWARE (0.40%)
Cognos /1/ 3,430 129,791
DENTAL SUPPLIES & EQUIPMENT (0.96%)
Patterson /1/ 6,180 312,399
DIAGNOSTIC KITS (0.64%)
Dade Behring Holdings /1/ 3,360 207,211
DISPOSABLE MEDICAL PRODUCTS (1.73%)
C.R. Bard 7,920 563,666
DISTRIBUTION-WHOLESALE (0.93%)
CDW 5,520 301,889
DIVERSIFIED MANUFACTURING OPERATIONS (2.45%)
Actuant /1/ 3,040 129,474
Pentair 5,610 223,166
Roper Industries 6,550 443,238
795,878
E-COMMERCE-PRODUCTS (0.27%)
Overstock.com /1/ 2,510 88,553
E-COMMERCE-SERVICES (1.07%)
Monster Worldwide /1/ 15,080 346,991
ELECTRIC PRODUCTS-MISCELLANEOUS (0.68%)
Ametek 5,880 222,676
ELECTRIC-GENERATION (0.88%)
AES /1/ 17,770 285,742
ELECTRONIC COMPONENTS-SEMICONDUCTOR (2.95%)
Altera /1/ 26,710 553,698
National Semiconductor 14,880 283,911
PMC - Sierra /1/ 15,270 123,076
960,685
FIDUCIARY BANKS (0.82%)
Northern Trust 5,950 267,928
FINANCE-INVESTMENT BANKER & BROKER (1.16%)
Jefferies Group 4,900 177,380
Legg Mason 2,830 200,534
377,914
FOOD-CONFECTIONERY (0.58%)
Hershey 2,950 188,505
FOOD-RETAIL (0.77%)
Whole Foods Market 2,510 250,297
HOSPITAL BEDS & EQUIPMENT (0.54%)
Kinetic Concepts /1/ 2,850 175,133
HOTELS & MOTELS (2.57%)
Marriott International 9,000 564,750
Starwood Hotels & Resorts Worldwide 4,960 269,526
834,276
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
HUMAN RESOURCES (0.76%)
$
Robert Half International 9,990 247,952
IDENTIFICATION SYSTEM-DEVELOPMENT (0.75%)
Cogent /1/ 10,770 242,325
INDUSTRIAL AUTOMATION & ROBOTS (0.72%)
Rockwell Automation 5,100 235,773
INDUSTRIAL GASES (0.58%)
Praxair 4,060 190,130
INSTRUMENTS-SCIENTIFIC (1.52%)
Fisher Scientific International /1/ 8,330 494,635
INTERNET CONTENT-INFORMATION & NEWS (0.77%)
CNET Networks /1/ 25,300 250,849
INTERNET INFRASTRUCTURE SOFTWARE (1.84%)
F5 Networks /1/ 8,430 360,888
Openwave Systems /1/ 17,850 239,012
599,900
INTERNET SECURITY (2.57%)
CheckFree /1/ 10,070 369,368
VeriSign /1/ 17,650 467,019
836,387
INTIMATE APPAREL (0.45%)
Warnaco Group /1/ 6,480 145,541
INVESTMENT MANAGEMENT & ADVISORY SERVICES (2.61%)
Affiliated Managers Group /1/ 5,705 356,734
T. Rowe Price Group 8,890 490,461
847,195
LASERS-SYSTEMS & COMPONENTS (0.50%)
Cymer /1/ 6,610 163,862
LEISURE & RECREATION PRODUCTS (0.45%)
WMS Industries /1/ 5,710 145,034
MACHINERY-CONSTRUCTION & MINING (0.50%)
Joy Global 4,830 163,592
MEDICAL INSTRUMENTS (1.35%)
Biomet 11,310 437,584
MEDICAL LABORATORY & TESTING SERVICE (0.79%)
Laboratory Corp. of America Holdings /1/ 5,170 255,915
MEDICAL PRODUCTS (1.19%)
Cooper 3,730 251,961
INAMED /1/ 2,200 133,848
385,809
MEDICAL-BIOMEDICAL/GENE (2.08%)
Celgene /1/ 4,340 164,529
Genzyme /1/ 8,720 511,079
675,608
MEDICAL-DRUGS (1.32%)
Sepracor /1/ 7,190 430,825
MEDICAL-HMO (3.62%)
Pacificare Health Systems /1/ 5,360 320,314
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-HMO (CONTINUED)
$
WellPoint /1/ 6,720 858,480
1,178,794
MEDICAL-HOSPITALS (1.50%)
Community Health Systems /1/ 8,070 294,151
Triad Hospitals /1/ 3,800 194,750
488,901
METAL PROCESSORS & FABRICATION (0.63%)
Precision Castparts 2,770 204,038
MISCELLANEOUS INVESTING (0.81%)
Host Marriott 15,570 261,887
MOTION PICTURES & SERVICES (0.69%)
DreamWorks Animation /1/ 5,980 224,250
NETWORKING PRODUCTS (1.48%)
Ixia /1/ 9,890 158,339
Juniper Networks /1/ 14,270 322,359
480,698
OIL & GAS DRILLING (0.75%)
Diamond Offshore Drilling 4,850 213,934
Ensco International 910 29,666
243,600
OIL COMPANY-EXPLORATION & PRODUCTION (2.10%)
Range Resources 11,620 263,193
Ultra Petroleum /1/ 3,370 170,117
XTO Energy 8,316 250,894
684,204
OIL FIELD MACHINERY & EQUIPMENT (1.73%)
Grant Prideco /1/ 13,700 303,866
National-Oilwell Varco /1/ 6,490 257,913
561,779
OIL-FIELD SERVICES (0.47%)
Tidewater 4,430 152,702
OPTICAL SUPPLIES (1.73%)
Advanced Medical Optics /1/ 5,560 205,609
Bausch & Lomb 4,740 355,500
561,109
PHARMACY SERVICES (1.05%)
Medco Health Solutions /1/ 6,730 343,028
PIPELINES (1.10%)
Questar 6,110 356,824
POWER CONVERTER & SUPPLY EQUIPMENT (0.40%)
American Power Conversion 5,320 129,063
RADIO (0.49%)
Sirius Satellite Radio /1/ 33,280 158,413
REAL ESTATE OPERATOR & DEVELOPER (0.61%)
St. Joe 2,840 197,636
RECREATIONAL VEHICLES (0.30%)
Polaris Industries 1,680 96,701
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-APPAREL & SHOE (2.87%)
$
Chico's FAS /1/ 18,520 474,668
Nordstrom 3,350 170,280
Urban Outfitters /1/ 6,530 289,279
934,227
RETAIL-BEDDING (1.37%)
Bed Bath & Beyond /1/ 12,010 446,892
RETAIL-MAIL ORDER (0.73%)
Williams-Sonoma /1/ 7,110 238,114
RETAIL-RESTAURANTS (1.80%)
Cheesecake Factory /1/ 6,200 190,278
P.F. Chang's China Bistro /1/ 4,010 222,635
Yum! Brands 3,660 171,874
584,787
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (2.12%)
Cypress Semiconductor /1/ 12,530 150,235
Integrated Device Technology /1/ 16,160 172,912
Marvell Technology Group /1/ 10,950 366,606
689,753
SEMICONDUCTOR EQUIPMENT (1.70%)
Kla-Tencor /1/ 8,430 328,939
Lam Research /1/ 8,760 224,694
553,633
STEEL-SPECIALTY (0.75%)
Allegheny Technologies 10,960 245,504
TELECOMMUNICATION EQUIPMENT (1.29%)
Comverse Technology /1/ 18,360 418,424
TELECOMMUNICATION SERVICES (1.06%)
Amdocs /1/ 12,930 345,360
THERAPEUTICS (0.41%)
MGI Pharma /1/ 6,030 132,962
TRANSPORT-SERVICES (0.38%)
UTI Worldwide 1,910 122,507
WEB HOSTING & DESIGN (0.80%)
Macromedia /1/ 6,540 $ 259,049
TOTAL COMMON STOCKS 32,144,729
-----------
TOTAL PORTFOLIO INVESTMENTS (98.85%) 32,144,729
CASH, RECEIVABLES AND OTHER ASSETS, NET OF
LIABILITIES (1.15%) 372,884
TOTAL NET ASSETS (100.00%) $32,517,613
-------------
/1 /Non-income producing security.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 4,439,537
Unrealized Depreciation (1,177,717)
-----------
Net Unrealized Appreciation (Depreciation) 3,261,820
Cost for federal income tax purposes $28,882,909
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
Consumer,
Non-cyclical $ 8,133,480 25.30%
Consumer, Cyclical 5,816,624 18.09
Technology 4,915,618 15.29
Communications 4,627,913 14.40
Industrial 3,158,317 9.83
Financial 2,417,041 7.52
Energy 2,186,006 6.80
Basic Materials 603,988 1.88
Utilities 285,742 0.89
TOTAL $32,144,729 100.00%
---------------- ------------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
153
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS SMALLCAP GROWTH FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (95.53%)
AIRLINES (0.36%)
$
Pinnacle Airlines /1/ 6,900 71,346
APPAREL MANUFACTURERS (1.26%)
Phillips-Van Heusen 9,800 253,624
APPLICATIONS SOFTWARE (1.21%)
MRO Software /1/ 900 11,511
Progress Software /1/ 700 18,676
Verint Systems /1/ 6,700 213,194
243,381
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.63%)
American Axle & Manufacturing Holdings 6,300 125,748
BEVERAGES-NON-ALCOHOLIC (0.95%)
Cott /1/ 7,300 163,447
Hansen Natural /1/ 500 28,340
191,787
BEVERAGES-WINE & SPIRITS (0.94%)
Constellation Brands /1/ 3,600 189,756
BUILDING & CONSTRUCTION-MISCELLANEOUS (1.10%)
Dycom Industries /1/ 9,500 220,970
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.04%)
Eagle Materials 100 7,525
BUILDING PRODUCTS-LIGHT FIXTURES (0.79%)
Genlyte Group /1/ 2,000 158,680
BUILDING-RESIDENTIAL & COMMERCIAL (2.21%)
Hovnanian Enterprises /1/ 4,500 228,465
NVR /1/ 300 215,505
443,970
CIRCUIT BOARDS (2.01%)
Benchmark Electronics /1/ 10,350 279,864
TTM Technologies /1/ 13,800 124,338
404,202
COMMERCIAL BANKS (1.97%)
MB Financial 400 14,548
Preferred Bank 300 11,322
Prosperity Bancshares 700 17,885
Sun Bancorp. /1/ 577 11,546
Texas Capital Bancshares /1/ 700 12,509
UCBH Holdings 20,040 315,229
Yardville National Bancorp. 400 12,936
395,975
COMMERCIAL SERVICES (0.04%)
Collectors Universe /1/ 400 7,272
COMMUNICATIONS SOFTWARE (0.15%)
Avid Technology /1/ 600 29,706
COMPUTER SERVICES (5.49%)
CACI International /1/ 6,690 415,583
Cognizant Technology Solutions /1/ 13,160 552,851
FactSet Research Systems 4,560 126,586
Kanbay International /1/ 500 8,990
1,104,010
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMPUTERS-INTEGRATED SYSTEMS (0.80%)
$
Micros Systems /1/ 1,500 59,475
RadiSys /1/ 7,300 102,200
161,675
COMPUTERS-MEMORY DEVICES (0.33%)
Dot Hill Systems /1/ 12,500 59,000
M-Systems Flash Disk Pioneers /1/ 400 7,580
66,580
COMPUTERS-PERIPHERAL EQUIPMENT (0.05%)
Mobility Electronics /1/ 1,300 10,088
CONSULTING SERVICES (1.74%)
Charles River Associates /1/ 5,600 293,440
DiamondCluster International /1/ 2,100 26,145
Navigant Consulting /1/ 1,300 30,511
350,096
CONSUMER PRODUCTS-MISCELLANEOUS (1.20%)
Central Garden & Pet /1/ 5,800 241,222
DATA PROCESSING & MANAGEMENT (1.42%)
Fair, Isaac 4,350 143,028
Infocrossing /1/ 900 14,805
NAVTEQ /1/ 3,500 127,470
285,303
DIAGNOSTIC EQUIPMENT (0.16%)
Gen-Probe /1/ 600 30,114
NEUROMetrix /1/ 200 2,298
32,412
DISTRIBUTION-WHOLESALE (0.54%)
Beacon Roofing Supply /1/ 3,500 77,700
WESCO International /1/ 1,300 31,434
109,134
DIVERSIFIED MANUFACTURING OPERATIONS (1.44%)
ESCO Technologies /1/ 3,800 278,616
Jacuzzi Brands /1/ 1,200 10,860
289,476
DRUG DELIVERY SYSTEMS (0.46%)
Penwest Pharmaceuticals /1/ 7,200 92,160
E-COMMERCE-PRODUCTS (0.04%)
1-800-flowers.com /1/ 1,100 7,370
E-MARKETING-INFORMATION (0.79%)
24/7 Real Media /1/ 2,500 7,175
Digital River /1/ 5,700 151,620
158,795
E-SERVICES-CONSULTING (0.07%)
Niku /1/ 900 14,184
ELECTRONIC COMPONENTS-SEMICONDUCTOR (2.64%)
Cree /1/ 2,800 67,732
Microsemi /1/ 16,200 274,104
Silicon Image /1/ 18,000 181,260
Siliconix /1/ 200 6,594
529,690
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC DESIGN AUTOMATION (0.25%)
$
Ansoft /1/ 300 6,960
Magma Design Automation /1/ 7,000 42,980
49,940
ELECTRONIC MEASUREMENT INSTRUMENTS (0.05%)
Flir Systems /1/ 200 5,320
Keithley Instruments 400 5,556
10,876
ELECTRONIC SECURITY DEVICES (0.08%)
American Science & Engineering /1/ 400 15,328
ELECTRONICS-MILITARY (1.35%)
Engineered Support Systems 7,695 271,787
ENERGY-ALTERNATE SOURCES (0.02%)
KFx /1/ 400 4,360
ENGINEERING-RESEARCH & DEVELOPMENT SERVICES (0.47%)
EMCOR Group /1/ 2,100 93,828
ENTERPRISE SOFTWARE & SERVICE (0.12%)
Hyperion Solutions /1/ 200 8,134
Ultimate Software Group /1/ 1,000 15,500
23,634
ENTERTAINMENT SOFTWARE (0.77%)
the9 /1/ 400 7,320
THQ /1/ 5,880 148,294
155,614
FIDUCIARY BANKS (1.71%)
Investors Financial Services 8,200 343,990
FINANCE-OTHER SERVICES (0.08%)
International Securities Exchange /1/ 600 15,792
FOOD-WHOLESALE & DISTRIBUTION (0.63%)
Performance Food Group /1/ 4,700 126,383
HOME FURNISHINGS (0.13%)
Tempur-Pedic International /1/ 1,400 26,726
HOTELS & MOTELS (0.47%)
La Quinta /1/ 2,900 25,230
Orient-Express Hotels 2,600 68,302
93,532
HUMAN RESOURCES (1.54%)
Gevity HR 600 9,630
Korn/Ferry International /1/ 4,600 66,240
Labor Ready /1/ 14,000 233,660
309,530
INDUSTRIAL AUDIO & VIDEO PRODUCTS (0.17%)
Dolby Laboratories /1/ 1,700 34,765
INDUSTRIAL AUTOMATION & ROBOTS (0.91%)
Cognex 8,400 183,456
INDUSTRIAL GASES (0.17%)
Airgas 1,600 35,072
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
INSTRUMENTS-CONTROLS (0.05%)
$
Photon Dynamics /1/ 500 9,675
INTERNET CONNECTIVE SERVICES (0.08%)
Redback Networks /1/ 2,900 15,544
INTERNET CONTENT-INFORMATION & NEWS (0.09%)
InfoSpace /1/ 100 3,099
iVillage /1/ 2,300 15,065
18,164
INTERNET INFRASTRUCTURE EQUIPMENT (0.34%)
Avocent /1/ 2,700 67,878
INTERNET INFRASTRUCTURE SOFTWARE (0.05%)
Opsware /1/ 2,000 9,560
INTERNET SECURITY (0.98%)
RSA Security /1/ 10,100 108,474
Secure Computing /1/ 9,900 87,615
196,089
INTERNET TELEPHONY (0.02%)
j2 Global Communications /1/ 100 3,572
LASERS-SYSTEMS & COMPONENTS (0.10%)
Ii-Vi /1/ 1,398 19,866
MACHINERY TOOLS & RELATED PRODUCTS (0.07%)
Kennametal 300 13,590
MACHINERY-CONSTRUCTION & MINING (0.09%)
JLG Industries 875 17,833
MACHINERY-GENERAL INDUSTRY (0.67%)
Middleby 2,600 114,504
Wabtec 1,000 20,000
134,504
MACHINERY-MATERIAL HANDLING (0.00%)
Paragon Technologies /1/ 100 984
MEDICAL INSTRUMENTS (1.67%)
Advanced Neuromodulation Systems /1/ 4,700 141,517
ArthroCare /1/ 6,600 193,908
335,425
MEDICAL LABORATORY & TESTING SERVICE (0.08%)
LabOne /1/ 450 15,786
MEDICAL LASER SYSTEMS (0.15%)
VISX /1/ 1,300 30,992
MEDICAL PRODUCTS (1.79%)
INAMED /1/ 5,800 352,872
ThermoGenesis /1/ 2,000 6,860
359,732
MEDICAL-BIOMEDICAL/GENE (2.34%)
Affymetrix /1/ 2,600 119,886
Charles River Laboratories International
/1/ 2,160 102,319
Corgentech /1/ 4,300 9,460
Illumina /1/ 1,200 11,784
Incyte Genomics /1/ 11,900 77,826
Martek Biosciences /1/ 200 7,654
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-BIOMEDICAL/GENE (CONTINUED)
Protein Design Labs /1/ 600 $ 10,728
Regeneration Technologies /1/ 800 7,352
Telik /1/ 7,200 116,640
Vasogen /1/ 1,800 6,696
470,345
MEDICAL-DRUGS (1.60%)
First Horizon Pharmaceutical /1/ 10,700 193,777
KV Pharmaceutical /1/ 450 10,530
Prestige Brands Holdings /1/ 5,300 95,400
Salix Pharmaceuticals /1/ 500 7,150
Vaxgen /1/ 1,300 14,105
320,962
MEDICAL-GENERIC DRUGS (0.49%)
Taro Pharmaceuticals Industries /1/ 3,400 98,804
MEDICAL-HMO (0.03%)
Centene /1/ 200 5,570
MEDICAL-HOSPITALS (3.62%)
Horizon Health /1/ 200 8,196
Symbion /1/ 300 6,384
United Surgical Partners International
/1/ 5,600 247,800
VCA Antech /1/ 20,000 465,600
727,980
MISCELLANEOUS INVESTING (3.48%)
American Financial Realty Trust 2,500 38,325
BioMed Realty Trust 5,400 109,080
Entertainment Properties Trust 700 30,240
Mills 4,400 251,416
Ventas 10,000 269,800
698,861
MISCELLANEOUS MANUFACTURERS (0.12%)
Applied Films /1/ 1,000 23,910
MOTION PICTURES & SERVICES (0.10%)
Lions Gate Entertainment /1/ 2,050 19,803
MULTI-LINE INSURANCE (0.05%)
HCC Insurance Holdings 300 10,671
NETWORKING PRODUCTS (0.61%)
Foundry Networks /1/ 9,900 83,160
Ixia /1/ 1,800 28,818
Netgear /1/ 600 9,678
121,656
OFFICE AUTOMATION & EQUIPMENT (0.16%)
Global Imaging Systems /1/ 900 31,221
OIL & GAS DRILLING (1.20%)
Grey Wolf /1/ 2,900 17,400
Patterson-UTI Energy 8,800 210,936
Pioneer Drilling /1/ 1,000 13,190
241,526
OIL COMPANY-EXPLORATION & PRODUCTION (5.30%)
ATP Oil & Gas /1/ 200 4,094
Carrizo Oil & Gas /1/ 500 8,265
Patina Oil & Gas 10,850 416,640
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL COMPANY-EXPLORATION & PRODUCTION (CONTINUED)
$
Quicksilver Resources /1/ 12,400 636,492
1,065,491
OIL-FIELD SERVICES (1.51%)
Cal Dive International /1/ 550 24,464
Hornbeck Offshore Services /1/ 100 2,300
Superior Energy Services /1/ 1,100 16,368
Tetra Technologies /1/ 9,650 260,839
303,971
PATIENT MONITORING EQUIPMENT (0.69%)
Aspect Medical Systems /1/ 5,600 140,168
PHYSICAL THERAPY & REHABILITATION CENTERS (1.55%)
Psychiatric Solutions /1/ 7,250 311,895
PHYSICIAN PRACTICE MANAGEMENT (2.23%)
Pediatrix Medical Group /1/ 6,580 448,032
PROPERTY & CASUALTY INSURANCE (0.28%)
Philadelphia Consolidated Holding /1/ 300 22,500
Selective Insurance Group 500 22,075
United America Indemnity /1/ 600 10,812
55,387
PUBLICLY TRADED INVESTMENT FUND (1.78%)
iShares Russell 2000 Index Fund 3,100 357,275
RACETRACKS (0.10%)
Speedway Motorsports 600 20,580
RADIO (0.85%)
Cumulus Media /1/ 10,100 131,098
Salem Communications /1/ 2,100 40,362
171,460
RENTAL-AUTO & EQUIPMENT (0.11%)
Aaron Rents 1,000 21,960
RESPIRATORY PRODUCTS (0.66%)
ResMed /1/ 2,135 132,584
RETAIL-APPAREL & SHOE (2.84%)
Aeropostale /1/ 9,150 255,559
American Eagle Outfitters 500 13,110
Chico's FAS /1/ 11,800 302,434
571,103
RETAIL-COMPUTER EQUIPMENT (1.62%)
Electronics Boutique Holdings /1/ 5,837 325,296
RETAIL-HOME FURNISHINGS (0.02%)
Cost Plus /1/ 200 4,638
RETAIL-LEISURE PRODUCTS (0.07%)
MarineMax /1/ 500 13,525
RETAIL-MAIL ORDER (0.06%)
Celebrate Express /1/ 602 8,566
Collegiate Pacific 400 3,560
12,126
RETAIL-MUSIC STORE (1.40%)
Guitar Center /1/ 5,700 281,295
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-PET FOOD & SUPPLIES (1.25%)
$
PETCO Animal Supplies /1/ 8,000 250,400
RETAIL-RESTAURANTS (2.93%)
Checkers Drive-In Restaurant /1/ 700 8,575
CKE Restaurants /1/ 16,700 247,828
Panera Bread /1/ 2,050 102,541
RARE Hospitality International /1/ 600 16,692
Ruby Tuesday 8,800 198,000
Sonic /1/ 500 16,020
589,656
RETAIL-SPORTING GOODS (0.16%)
Hibbett Sporting Goods /1/ 1,200 32,364
SAVINGS & LOANS-THRIFTS (1.17%)
BankUnited Financial 5,400 128,952
Commercial Capital Bancorp. 1,200 18,948
Harbor Florida Bancshares 2,500 86,500
234,400
SCHOOLS (0.04%)
Education Management /1/ 300 8,400
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (1.51%)
Exar /1/ 8,550 108,500
Power Integrations /1/ 6,700 145,725
Standard Microsystems /1/ 3,500 49,525
303,750
SEMICONDUCTOR EQUIPMENT (0.98%)
August Technology /1/ 6,300 74,340
Brooks Automation /1/ 601 7,729
Credence Systems /1/ 600 3,774
Helix Technology 300 3,613
Rudolph Technologies /1/ 5,400 69,660
Semitool /1/ 2,200 19,866
Varian Semiconductor Equipment Associates
/1/ 500 18,645
197,627
SOFTWARE (0.04%)
Opnet Technologies /1/ 1,100 8,569
STEEL PRODUCERS (0.69%)
Steel Dynamics 5,100 138,618
STEEL-SPECIALTY (0.08%)
Allegheny Technologies 700 15,680
TELECOMMUNICATION EQUIPMENT (0.01%)
Tut Systems /1/ 800 2,392
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.21%)
C-COR.net /1/ 5,900 38,999
Harmonic /1/ 500 2,755
41,754
TEXTILE-PRODUCTS (0.01%)
Dixie Group /1/ 200 3,000
THERAPEUTICS (1.86%)
Amylin Pharmaceuticals /1/ 3,500 59,500
Bioenvision /1/ 1,200 7,680
Isis Pharmaceuticals /1/ 9,600 27,840
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
THERAPEUTICS (CONTINUED)
$
Medicines /1/ 5,700 121,695
Neurocrine Biosciences /1/ 2,861 100,021
NPS Pharmaceuticals /1/ 4,700 57,105
373,841
TOYS (0.16%)
Marvel Enterprises /1/ 1,600 31,360
TRANSPORT-AIR FREIGHT (0.83%)
EGL /1/ 8,600 167,786
TRANSPORT-RAIL (0.04%)
Genesee & Wyoming /1/ 350 8,393
TRANSPORT-SERVICES (0.95%)
Universal Truckload Services /1/ 300 4,782
UTI Worldwide 2,900 186,006
190,788
TRANSPORT-TRUCK (1.63%)
Celadon Group /1/ 800 12,952
Forward Air 800 19,248
Landstar System /1/ 9,000 275,850
Old Dominion Freight Line /1/ 700 19,670
327,720
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS SMALLCAP GROWTH FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
WIRELESS EQUIPMENT (0.13%)
InterDigital Communications /1/ 1,100 $ 17,996
Viasat /1/ 500 8,905
26,901
TOTAL COMMON STOCKS 19,201,438
-----------
TOTAL PORTFOLIO INVESTMENTS (95.53%) 19,201,438
CASH, RECEIVABLES AND OTHER ASSETS, NET OF
LIABILITIES (4.47%) 899,238
TOTAL NET ASSETS (100.00%) $20,100,676
-------------
/1 /Non-income producing security.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 4,367,167
Unrealized Depreciation (1,885,693)
-----------
Net Unrealized Appreciation (Depreciation) 2,481,474
Cost for federal income tax purposes $16,719,964
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
Consumer,
Non-cyclical $ 5,343,094 27.83%
Consumer, Cyclical 3,279,227 17.08
Technology 3,216,331 16.75
Industrial 2,605,941 13.57
Financial 1,755,076 9.14
Energy 1,615,349 8.41
Communications 839,775 4.37
Funds 357,275 1.86
Basic Materials 189,370 0.99
TOTAL $19,201,438 100.00%
---------------- ------------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
158
SCHEDULE OF INVESTMENTS
PRINCIPAL REAL ESTATE SECURITIES FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- -----------------------------------------------------------------------------------
COMMON STOCKS (99.38%)
HOTELS & MOTELS (0.46%)
$
Hilton Hotels 19,386 423,196
REAL ESTATE INVESTMENT TRUSTS (98.92%)
Acadia Realty Trust 40,803 654,888
AMB Property 43,809 1,708,113
Archstone-Smith Trust 75,800 2,726,526
AvalonBay Communities 47,200 3,398,400
BioMed Realty Trust 46,841 946,188
Boston Properties 75,776 5,036,831
Brookfield Properties 139,950 3,553,331
Camden Property Trust 20,985 1,070,235
Capital Automotive 29,540 1,003,769
CBL & Associates Properties 41,090 3,179,133
CenterPoint Properties Trust 37,236 1,534,496
Corporate Office Properties
Trust 55,824 1,468,171
Developers Diversified Realty 75,219 3,192,294
Eastgroup Properties 20,967 786,263
Education Realty Trust 17,022 272,352
Entertainment Properties Trust 19,314 834,365
Equity Office Properties Trust 64,701 2,036,140
Equity Residential Properties
Trust 66,000 2,267,100
Essex Property Trust 20,700 1,572,165
Extra Space Storage 29,673 385,749
Federal Realty Investment Trust 9,814 525,049
General Growth Properties 61,196 2,393,376
Host Marriott 155,375 2,613,408
Kilroy Realty 11,000 479,930
Kimco Realty 73,100 4,049,009
LaSalle Hotel Properties 47,596 1,445,966
Macerich 27,600 1,664,280
Mid-America Apartment
Communities 18,400 703,432
Mills 47,442 2,710,836
Pan Pacific Retail Properties 36,970 2,233,727
Prologis Trust 94,650 3,747,194
Public Storage 70,000 4,109,000
Regency Centers 19,000 1,000,350
Simon Property Group 109,660 7,245,236
SL Green Realty 79,038 4,821,318
Starwood Hotels & Resorts
Worldwide 70,800 3,847,272
Tanger Factory Outlet Centers 30,448 705,176
Taubman Centers 37,195 1,100,972
United Dominion Realty Trust 47,007 1,041,205
Ventas 92,176 2,486,908
Vornado Realty Trust 65,600 5,015,120
91,565,273
TOTAL COMMON STOCKS 91,988,469
Principal
Amount Value
- -----------------------------------------------------------------------------------
COMMERCIAL PAPER (0.62%)
MONEY CENTER BANKS (0.62%)
Investment in Joint Trading
Account; Citicorp
$ $
2.95%; 05/02/05 574,497 574,497
TOTAL COMMERCIAL PAPER 574,497
-----------
TOTAL PORTFOLIO INVESTMENTS (100.00%) 92,562,966
CASH, RECEIVABLES AND
OTHER ASSETS, NET OF
LIABILITIES (0.00%) 2,833
TOTAL NET ASSETS (100.00%) $92,565,799
-------------
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $23,433,339
Unrealized Depreciation (131,027)
-----------
Net Unrealized Appreciation (Depreciation) 23,302,312
Cost for federal income tax purposes $69,260,654
INVESTMENTS BY REIT TYPE (UNAUDITED)
REIT Type Value Percentage of
Total Value
- --------------------------------------------------------------------------------
$
Office & Industrial REITs 21,778,381 23.53%
Mall REITs 18,999,009 20.52
Apartment REITs 12,779,063 13.80
Shopping Center REITs 11,655,318 12.59
Diversified REITs 10,678,936 11.54
Hotel REITs 7,906,646 8.54
Self Storage REITs 4,494,749 4.86
Healthcare REITs 2,486,908 2.69
Other Investments 997,693 1.08
Mortgage, Mixed Use &
Miscellaneous REITs 786,263 0.85
TOTAL $92,562,966 100.00%
--------------- -----------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
159
SCHEDULE OF INVESTMENTS
PRINCIPAL SMALLCAP FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (101.38%)
AEROSPACE & DEFENSE EQUIPMENT (0.51%)
$
Orbital Sciences /1/ 61,246 570,813
AIRLINES (0.41%)
Pinnacle Airlines /1/ /2/ 43,650 451,341
APPAREL MANUFACTURERS (0.45%)
Guess? /1/ 38,110 496,192
APPLICATIONS SOFTWARE (0.54%)
American Reprographics /1/ 43,043 604,754
ATHLETIC EQUIPMENT (0.70%)
Nautilus /2/ 31,375 779,983
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.39%)
Tenneco Automotive /1/ /2/ 33,846 434,244
AUTO/TRUCK PARTS & EQUIPMENT-REPLACEMENT (0.34%)
Commercial Vehicle Group /1/ 19,674 379,315
BUILDING & CONSTRUCTION PRODUCTS-
MISCELLANEOUS (0.83%)
NCI Building Systems /1/ /2/ 28,554 925,721
BUILDING PRODUCTS-CEMENT & AGGREGATE (1.16%)
Eagle Materials 17,080 1,285,270
BUILDING PRODUCTS-LIGHT FIXTURES (0.61%)
Genlyte Group /1/ 8,585 681,134
BUILDING PRODUCTS-WOOD (0.83%)
Universal Forest Products 24,317 925,505
BUILDING-HEAVY CONSTRUCTION (0.74%)
Perini /1/ 59,629 826,458
BUILDING-MAINTENANCE & SERVICE (0.86%)
Rollins 48,236 952,179
BUILDING-MOBILE HOME & MANUFACTURED HOUSING (0.56%)
Thor Industries 23,270 627,127
BUILDING-RESIDENTIAL & COMMERCIAL (0.34%)
M/I Homes 8,372 382,600
CASINO HOTELS (0.51%)
Ameristar Casinos /2/ 11,452 564,584
CELLULAR TELECOMMUNICATIONS (0.49%)
Ubiquitel /1/ /2/ 75,659 547,015
CHEMICALS-DIVERSIFIED (0.92%)
FMC /1/ 20,940 1,026,060
CHEMICALS-SPECIALTY (1.08%)
MacDermid 39,408 1,196,033
COMMERCIAL BANKS (9.23%)
AmericanWest Bancorp. /1/ 14,475 269,669
Capital Corp of the West 28,742 696,993
Cathay General Bancorp 21,766 715,448
City Holding 25,114 807,666
Columbia Banking Systems 46,408 1,089,196
Community Trust Bancorp 9,605 288,630
First Midwest Bancorp 13,438 438,885
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL BANKS (CONTINUED)
$
Frontier Financial 15,116 545,234
Hancock Holding 13,008 387,899
Heritage Commerce /1/ 23,835 455,249
IBERIABANK 8,732 497,637
Pacific Capital Bancorp. 30,201 870,695
Preferred Bank 4,826 182,133
Signature Bank /1/ 18,889 465,236
Southwest Bancorp. 25,774 486,098
State Financial Services 9,843 359,663
Vineyard National Bancorp. 30,838 904,170
Vineyard National Bancorp.-Rights /1/ /3/ /4/
/5/ 1,788 -
Vineyard National Bancorp.-Warrants /1/ /3/
/4/ /5/ 4,738 20,468
Wilshire Bancorp. 56,176 768,488
10,249,457
COMMERCIAL SERVICE-FINANCE (1.04%)
iPayment /1/ 19,352 704,219
NCO Group /1/ 24,459 455,671
1,159,890
COMPUTER AIDED DESIGN (0.63%)
ANSYS /1/ 22,961 698,933
COMPUTER SERVICES (1.36%)
CACI International /1/ 13,751 854,212
Perot Systems /1/ 52,175 658,970
1,513,182
COMPUTERS-INTEGRATED SYSTEMS (0.34%)
Brocade Communications Systems /1/ 87,493 381,469
CONSUMER PRODUCTS-MISCELLANEOUS (0.63%)
Central Garden & Pet /1/ 16,860 701,207
CONTAINERS-METAL & GLASS (2.45%)
Greif Brothers /2/ 21,873 1,517,330
Silgan Holdings 19,614 1,199,985
2,717,315
COSMETICS & TOILETRIES (0.62%)
Chattem /1/ 16,860 693,620
DATA PROCESSING & MANAGEMENT (1.31%)
Global Payments 12,074 781,912
infoUSA /1/ 61,660 677,027
1,458,939
DENTAL SUPPLIES & EQUIPMENT (1.08%)
Sybron Dental Specialties /1/ 32,092 1,195,427
DISTRIBUTION-WHOLESALE (0.61%)
United Stationers /1/ 16,114 679,689
E-COMMERCE-PRODUCTS (0.32%)
Provide Commerce /1/ /2/ 20,011 353,194
E-MARKETING-INFORMATION (0.42%)
Digital River /1/ 17,502 465,553
E-SERVICES-CONSULTING (0.93%)
Websense /1/ 19,420 1,030,231
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRIC-INTEGRATED (1.26%)
$
Otter Tail Power 28,587 701,525
PNM Resources 25,290 699,268
1,400,793
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.34%)
Benchmark Electronics /1/ 14,032 379,425
ELECTRONIC COMPONENTS-SEMICONDUCTOR (1.72%)
MEMC Electronics Materials /1/ 33,733 395,688
Microsemi /1/ /2/ 44,927 760,165
OmniVision Technologies /1/ /2/ 25,728 360,192
Semtech /1/ 23,246 392,625
1,908,670
ELECTRONIC MEASUREMENT INSTRUMENTS (1.07%)
LeCroy /1/ 37,677 495,829
Trimble Navigation /1/ 20,046 689,984
1,185,813
ENTERTAINMENT SOFTWARE (0.74%)
Activision /1/ 57,148 826,360
FINANCE-CREDIT CARD (0.77%)
Advanta 34,869 856,034
FINANCE-INVESTMENT BANKER & BROKER (0.14%)
GFI Group /1/ 6,523 152,312
FINANCE-MORTGAGE LOAN/BANKER (0.64%)
American Home Mortgage Investment /2/ 21,653 708,053
FOOD-MISCELLANEOUS/DIVERSIFIED (1.31%)
Chiquita Brands International 33,726 844,836
Ralcorp Holdings /1/ 15,371 608,999
1,453,835
FOOD-WHOLESALE & DISTRIBUTION (1.14%)
Nash Finch /2/ 35,783 1,265,645
FOOTWEAR & RELATED APPAREL (0.94%)
Wolverine World Wide 51,560 1,046,152
GAS-DISTRIBUTION (2.32%)
Energen 22,744 1,408,991
UGI 23,144 1,162,523
2,571,514
HOME FURNISHINGS (1.33%)
American Woodmark 22,203 706,943
Tempur-Pedic International /1/ /2/ 40,018 763,944
1,470,887
HOTELS & MOTELS (0.61%)
Choice Hotels International 11,142 674,314
HUMAN RESOURCES (1.79%)
Korn/Ferry International /1/ /2/ 48,106 692,727
Labor Ready /1/ /2/ 77,215 1,288,718
1,981,445
INDUSTRIAL AUDIO & VIDEO PRODUCTS (0.32%)
Dolby Laboratories /1/ 17,115 350,002
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
INTERNET APPLICATION SOFTWARE (0.47%)
$
eResearch Technology /1/ 45,737 519,572
INTERNET SECURITY (0.45%)
RSA Security /1/ 46,209 496,285
INTERNET TELEPHONY (0.57%)
j2 Global Communications /1/ /2/ 17,582 628,029
INVESTMENT COMPANIES (0.85%)
Apollo Investment 59,581 944,955
MACHINERY TOOLS & RELATED PRODUCTS (0.80%)
Kennametal 19,664 890,779
MACHINERY-CONSTRUCTION & MINING (0.76%)
Terex /1/ 22,691 848,190
MACHINERY-GENERAL INDUSTRY (1.15%)
Gardner Denver /1/ 19,662 718,450
Idex 15,033 559,979
1,278,429
MEDICAL INFORMATION SYSTEM (0.80%)
Dendrite International /1/ 57,250 882,795
MEDICAL INSTRUMENTS (1.06%)
dj Orthopedics /1/ 46,630 1,172,744
MEDICAL PRODUCTS (1.82%)
INAMED /1/ 7,144 434,641
PolyMedica 22,471 696,376
Syneron Medical /1/ 28,553 828,037
VNUS Medical Technologies /1/ /2/ 6,404 61,543
2,020,597
MEDICAL-BIOMEDICAL/GENE (0.82%)
Affymetrix /1/ /2/ 11,873 547,464
Lexicon Genetics /1/ 83,156 364,223
911,687
MEDICAL-DRUGS (0.24%)
Angiotech Pharmaceuticals /1/ 19,432 264,081
MEDICAL-HMO (2.13%)
AMERIGROUP /1/ 22,471 789,182
Sierra Health Services /1/ 24,318 1,573,131
2,362,313
MEDICAL-HOSPITALS (0.72%)
LifePoint Hospitals /1/ 17,945 797,655
MEDICAL-NURSING HOMES (0.88%)
Kindred Healthcare /1/ 29,529 971,504
MEDICAL-OUTPATIENT & HOME MEDICAL CARE (0.76%)
Amedisys /1/ 28,249 847,752
METAL PROCESSORS & FABRICATION (0.65%)
Metals USA /1/ 49,379 722,909
MISCELLANEOUS INVESTING (5.63%)
Brandywine Realty Trust 24,884 704,217
Entertainment Properties Trust 21,105 911,736
Gramercy Capital 41,694 828,877
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MISCELLANEOUS INVESTING (CONTINUED)
$
Newcastle Investment 20,307 598,854
Parkway Properties 12,525 571,140
Ramco-Gershenson Properties 21,102 584,314
Redwood Trust 16,660 834,999
Strategic Hotel Capital 41,602 587,004
Ventas 23,161 624,884
6,246,025
MULTIMEDIA (0.52%)
Journal Communications 37,202 572,911
NETWORKING PRODUCTS (0.33%)
Anixter International /1/ 9,800 361,816
OFFICE AUTOMATION & EQUIPMENT (0.47%)
Global Imaging Systems /1/ 14,988 519,934
OIL & GAS DRILLING (1.27%)
Grey Wolf /1/ 101,161 606,966
Helmerich & Payne 20,794 799,321
1,406,287
OIL COMPANY-EXPLORATION & PRODUCTION (1.71%)
Berry Petroleum /2/ 18,837 880,065
Houston Exploration /1/ 8,977 457,288
Meridian Resource /1/ /2/ 140,156 566,230
1,903,583
OIL FIELD MACHINERY & EQUIPMENT (0.55%)
Lone Star Technologies /1/ 15,736 612,760
OIL REFINING & MARKETING (0.64%)
Frontier Oil 16,839 708,585
PHYSICIAN PRACTICE MANAGEMENT (0.70%)
Pediatrix Medical Group /1/ 11,447 779,426
POULTRY (0.69%)
Gold Kist /1/ 47,750 760,658
PRINTING-COMMERCIAL (0.80%)
Consolidated Graphics /1/ 19,408 890,827
PRIVATE CORRECTIONS (0.76%)
GEO Group /1/ 31,989 840,031
PROPERTY & CASUALTY INSURANCE (2.52%)
Arch Capital Group /1/ 25,066 1,002,389
Infinity Property & Casualty 28,523 925,572
Stewart Information Services 24,193 871,432
2,799,393
RACETRACKS (0.76%)
Penn National Gaming /1/ 26,908 847,602
RENTAL-AUTO & EQUIPMENT (0.65%)
Aaron Rents 32,726 718,663
RESORTS & THEME PARKS (0.52%)
Vail Resorts /1/ 22,161 573,305
RESPIRATORY PRODUCTS (1.13%)
Respironics /1/ 19,833 1,253,247
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-APPAREL & SHOE (1.50%)
$
Genesco /1/ 25,128 646,543
New York & Co. /1/ 26,870 515,367
Stein Mart /1/ 24,962 505,730
1,667,640
RETAIL-LEISURE PRODUCTS (0.70%)
MarineMax /1/ 28,637 774,631
RETAIL-MUSIC STORE (0.56%)
Guitar Center /1/ 12,506 617,171
RETAIL-PAWN SHOPS (0.07%)
Cash America International 5,033 74,740
RETAIL-RESTAURANTS (2.39%)
Buffalo Wild Wings /1/ /2/ 14,386 437,622
California Pizza Kitchen /1/ 28,105 640,794
CKE Restaurants /1/ 63,755 946,124
O'Charley's /1/ 31,420 626,515
2,651,055
RETAIL-SPORTING GOODS (0.66%)
Big 5 Sporting Goods 30,639 731,966
SAVINGS & LOANS-THRIFTS (0.98%)
Fidelity Bankshares 27,859 642,428
WSFS Financial 8,715 445,598
1,088,026
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (0.47%)
SigmaTel /1/ 19,861 520,160
SEMICONDUCTOR EQUIPMENT (0.29%)
ATMI /1/ 14,055 322,070
STEEL PIPE & TUBE (0.52%)
NS Group /1/ 19,966 574,222
SUPERCONDUCTOR PRODUCTION & SYSTEMS (0.63%)
Intermagnetics General /1/ 28,586 702,072
TELECOMMUNICATION EQUIPMENT (1.41%)
Comtech Telecommunications /1/ 44,486 1,561,903
THEATERS (0.72%)
Carmike Cinemas 22,951 803,285
THERAPEUTICS (1.23%)
Connetics /1/ /2/ 30,886 671,153
Dyax /1/ 83,605 332,748
Eyetech Pharmaceuticals /1/ /2/ 15,902 365,587
1,369,488
TRANSACTIONAL SOFTWARE (0.59%)
Transaction Systems Architects /1/ 31,503 653,057
TRANSPORT-MARINE (1.07%)
OMI /2/ 31,721 577,005
Overseas Shipholding Group 10,912 615,764
1,192,769
TRANSPORT-SERVICES (1.87%)
Dynamex /1/ 48,596 871,327
HUB Group /1/ 17,122 941,710
Shares
Held Value
- -----------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TRANSPORT-SERVICES (CONTINUED)
$
Universal Truckload Services /1/ 16,779 267,457
2,080,494
TRANSPORT-TRUCK (0.94%)
Overnite 29,127 873,227
SCS Transportation /1/ 11,264 172,227
1,045,454
WEB PORTALS (0.52%)
SINA /1/ 20,825 572,063
TOTAL COMMON STOCKS 112,543,283
Principal
Amount Value
- -----------------------------------------------------------------------------------------
COMMERCIAL PAPER (0.63%)
MONEY CENTER BANKS (0.63%)
Investment in Joint Trading Account; Citicorp
$ $
2.95%; 05/02/05 698,423 698,423
TOTAL COMMERCIAL PAPER 698,423
Maturity
Amount Value
- -----------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (8.87%)
Goldman Sachs; 2.80%; dated 04/29/05 maturing
05/02/05 (collateralized by U.S. Treasury; $
$10,047,080; 05/15/16) /6/ $9,852,298 9,850,000
TOTAL REPURCHASE AGREEMENTS 9,850,000
------------
TOTAL PORTFOLIO INVESTMENTS (110.88%) 123,091,706
LIABILITIES, NET OF CASH, RECEIVABLES, AND OTHER ASSETS (-10.88%) (12,080,677)
TOTAL NET ASSETS (100.00%) $111,011,029
---------------
/1 /Non-income producing security.
/2 /Security or a portion of the security was on loan at the end of the period.
/3 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors. At the end of the period, the value of these
securities totaled $20,468 or 0.02% of net assets.
/4 /Security is illiquid.
/5 /Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from registration,
normally to qualified institutional buyers. Unless otherwise indicated, these
securities are not considered to be illiquid. At the end of the period, the
value of these securities totaled $20,468 or 0.02% of net assets.
/6 /Security was purchased with the cash proceeds from securities loans.
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 11,218,277
Unrealized Depreciation (7,266,026)
------------
Net Unrealized Appreciation (Depreciation) 3,952,251
Cost for federal income tax purposes $119,139,455
INVESTMENTS BY SECTOR (UNAUDITED)
Sector Value Percentage of
Total Value
- ------------------------------------------------------------------------------
Financial $ 33,592,678 27.29%
Consumer, Non-cyclical 25,363,923 20.61
Industrial 19,182,771 15.58
Consumer, Cyclical 16,727,822 13.59
Technology 10,290,324 8.36
Communications 7,108,572 5.77
Energy 4,631,216 3.76
Utilities 3,972,307 3.23
Basic Materials 2,222,093 1.81
TOTAL $123,091,706 100.00%
---------------- -----------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
SCHEDULE OF INVESTMENTS
PRINCIPAL TAX-EXEMPT BOND FUND, INC.
APRIL 30, 2005 (UNAUDITED)
Principal
Amount Value
- ----------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (97.14%)
ALABAMA (1.19%)
Courtland, Alabama
International Paper
$ $
4.75%; 05/01/17 2,000,000 2,022,280
ALASKA (0.63%)
Alaska Housing Finance
FGIC
5.25%; 12/01/34 1,000,000 1,070,720
ARIZONA (1.62%)
Arizona State University
AMBAC
5.25%; 09/01/24 1,500,000 1,626,945
Arizona State University
FGIC
5.50%; 07/01/21 1,000,000 1,133,970
2,760,915
CALIFORNIA (9.47%)
California
5.25%; 02/01/17 2,190,000 2,382,326
5.25%; 11/01/25 2,000,000 2,143,760
5.50%; 04/01/28 2,000,000 2,187,060
California Educational Facilities
Authority
Santa Clara University
5.75%; 09/01/21 2,000,000 2,117,100
California Pollution Control Financing
Authority
Waste Management
3.13%; 01/01/22 1,750,000 1,737,365
Golden State Tobacco Securitization
5.50%; 06/01/43 500,000 542,740
5.63%; 06/01/20 3,000,000 3,147,630
San Diego Redevelopment Agency
XLCA
5.00%; 09/01/23 1,775,000 1,868,241
16,126,222
COLORADO (3.74%)
Colorado Health Facilities Authority
Catholic Health Initiatives
5.38%; 12/01/11 1,565,000 1,675,630
Fort Collins, Colorado Lease
Certificate
AMBAC
5.38%; 06/01/23 2,275,000 2,496,244
Platte River Power Authority
5.38%; 06/01/17 2,000,000 2,203,220
6,375,094
FLORIDA (6.10%)
Dade County, Florida
FGIC
5.25%; 10/01/11 1,040,000 1,110,813
Florida State Board of Education
5.00%; 07/01/14 2,000,000 2,208,560
Gainesville, Florida
5.20%; 10/01/26 590,000 609,482
Principal
Amount Value
- ----------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
FLORIDA (CONTINUED)
Orange County, Florida
AMBAC
$ $
5.50%; 10/01/32 3,000,000 3,288,630
Orange County, Florida
MBIA
5.38%; 08/01/22 3,000,000 3,159,720
10,377,205
GEORGIA (0.60%)
Richmond County, Georgia
ASU Jaguar Student Housing
5.00%; 02/01/20 1,000,000 1,028,490
IDAHO (1.58%)
Idaho Health Facilities Authority
Portneuf Medical Center Project
5.25%; 09/01/25 2,000,000 2,122,960
Idaho Housing & Finance Association
5.90%; 01/01/15 545,000 561,999
2,684,959
ILLINOIS (8.84%)
Chicago, Illinois Board of Education
Albany PK Academy
5.50%; 12/01/21 1,270,000 1,420,012
Chicago, Illinois Board of Education
Benito Juarez Community Academy
6.00%; 12/01/17 1,220,000 1,425,936
6.00%; 12/01/18 1,290,000 1,505,611
6.00%; 12/01/21 1,540,000 1,800,091
Chicago, Illinois Gas Supply
Peoples Gas Light
4.75%; 03/01/30 2,000,000 2,080,880
Cook County, Illinois
5.25%; 11/15/28 2,000,000 2,161,400
Illinois Finance Authority
OSF Healthcare System
5.25%; 11/15/23 1,500,000 1,563,555
Illinois Health Facility
Advocate Health
5.25%; 08/15/08 320,000 345,206
7.00%; 02/15/09 190,000 206,040
7.00%; 02/15/18 720,000 886,392
Illinois Health Facility
Lake Forest Hospital
6.00%; 07/01/17 1,500,000 1,654,380
15,049,503
INDIANA (5.55%)
Hendricks County, Indiana
5.50%; 07/15/20 2,500,000 2,777,650
Indiana Bond Bank
Water & Sewer
5.88%; 08/01/13 1,060,000 1,195,913
Indiana Health Facility
Clarion Health Partners
5.38%; 02/15/09 2,020,000 2,126,616
Principal
Amount Value
- ----------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
INDIANA (CONTINUED)
Indianapolis Public Improvement
MBIA
$ $
5.50%; 01/01/16 3,000,000 3,345,270
9,445,449
IOWA (1.80%)
Chillicothe, Iowa
IES Utilities
3.60%; 11/01/23 1,100,000 1,080,442
Eddyville, Iowa
Cargill
5.63%; 12/01/13 1,000,000 1,011,310
Lansing, Iowa
Interstate Power
3.60%; 11/01/08 1,000,000 981,590
3,073,342
KANSAS (1.17%)
Burlington, Kansas
Kansas City Power & Light
2.38%; 10/01/17 2,000,000 1,994,840
KENTUCKY (2.42%)
Adair County, Kentucky
5.10%; 09/01/20 2,820,000 2,990,751
Kentucky Property & Buildings
Commission
FSA
5.38%; 02/01/18 1,000,000 1,122,560
4,113,311
MAINE (1.66%)
Jay, Maine
International Paper
6.20%; 09/01/19 1,000,000 1,074,530
Maine Governmental Facilities Authority
MBIA
5.38%; 10/01/17 1,600,000 1,760,544
2,835,074
MASSACHUSETTS (2.99%)
Massachusetts
5.50%; 03/01/12 3,000,000 3,366,420
Massachusetts Housing Finance Agency
FSA
3.15%; 06/01/08 1,750,000 1,727,547
5,093,967
MICHIGAN (2.91%)
Michigan State Trunk Line
FSA
5.25%; 10/01/21 1,000,000 1,086,920
Michigan Strategic Fund
Detroit Edison
5.45%; 09/01/29 2,000,000 2,098,480
Principal
Amount Value
- ----------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
MICHIGAN (CONTINUED)
Walled Lake, Michigan
MBIA
$ $
5.25%; 05/01/22 1,625,000 1,765,302
4,950,702
MISSISSIPPI (1.31%)
Mississippi
5.50%; 09/01/10 2,000,000 2,227,440
MISSOURI (1.31%)
Missouri Housing Development Commission
GNMA/FNMA
5.05%; 09/01/24 930,000 954,478
Missouri State Health & Educational
Facilities Authority
BJC Health System
5.00%; 05/15/20 1,200,000 1,273,944
2,228,422
NEVADA (1.24%)
Nevada
5.25%; 09/15/27 2,000,000 2,106,840
NEW HAMPSHIRE (1.30%)
New Hampshire Health & Education
Facilities Authority
FSA
5.50%; 08/01/27 2,000,000 2,207,040
NEW JERSEY (0.65%)
New Jersey Economic Development
Authority
5.00%; 06/15/11 525,000 571,153
5.63%; 06/15/19 500,000 537,065
1,108,218
NEW YORK (10.80%)
City of New York
XLCA
6.25%; 08/01/08 750,000 789,555
6.25%; 04/15/17 150,000 160,936
6.25%; 04/15/17 35,000 37,597
Nassau County, New York
5.25%; 11/15/17 2,800,000 3,105,844
New York City Municipal Water Finance
Authority
5.00%; 06/15/31 2,540,000 2,661,209
New York State Dormitory Authority
AMBAC
6.13%; 07/01/12 2,000,000 2,279,320
New York State Dormitory Authority
FSA
5.00%; 08/15/25 500,000 528,515
New York State Dormitory Authority
MBIA
5.25%; 10/01/23 1,500,000 1,632,390
New York State Thruway Authority
5.40%; 01/01/11 1,500,000 1,591,605
Principal
Amount Value
- ----------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
NEW YORK (CONTINUED)
Tobacco Settlement Financing Authority
$ $
5.25%; 06/01/21 2,200,000 2,377,320
5.50%; 06/01/14 2,000,000 2,168,540
United Nations Development
5.25%; 07/01/14 1,000,000 1,041,630
18,374,461
NORTH CAROLINA (1.41%)
Fayetteville, North Carolina
2.99%; 03/01/24 2,400,000 2,400,000
OKLAHOMA (1.38%)
Tulsa Industrial Authority
St. John Medical Center
6.25%; 02/15/06 1,280,000 1,314,752
6.25%; 02/15/06 1,000,000 1,027,150
2,341,902
OREGON (0.65%)
Oregon State Housing & Community
Services Department
5.65%; 07/01/28 1,070,000 1,099,981
PENNSYLVANIA (0.62%)
Pennsylvania State University
Government of the University
5.00%; 09/01/29 1,000,000 1,053,600
PUERTO RICO (1.27%)
Puerto Rico
5.25%; 07/01/22 2,000,000 2,158,380
SOUTH CAROLINA (3.92%)
South Carolina
5.75%; 01/01/13 3,000,000 3,374,730
South Carolina Public Service
FSA
5.38%; 01/01/16 3,000,000 3,292,680
6,667,410
TEXAS (11.22%)
Brazos River Authority
Houston Industries
5.13%; 05/01/19 2,000,000 2,130,740
Guadalupe-Blanco River Authority
E.I. Dupont De Nemours
6.35%; 07/01/22 2,500,000 2,551,475
Lower Colorado River Authority
FSA
6.00%; 05/15/13 2,500,000 2,773,950
Lower Colorado River Authority
MBIA
5.38%; 05/15/20 3,000,000 3,244,560
Red River Authority
MBIA
6.00%; 06/01/20 1,000,000 1,051,900
San Antonio, Texas
FSA
5.50%; 05/15/17 2,090,000 2,318,646
Principal
Amount Value
- ----------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
TEXAS (CONTINUED)
Texas State Department Of Housing &
Community Affairs
$ $
5.70%; 01/01/33 2,755,000 2,905,230
University of Texas
5.25%; 07/01/17 1,905,000 2,118,512
19,095,013
UTAH (1.67%)
Utah Water Finance Agency
AMBAC
5.00%; 10/01/26 2,700,000 2,841,237
WASHINGTON (2.18%)
Grant County, Washington
5.00%; 01/01/24 1,550,000 1,635,033
Seattle, Washington
5.00%; 07/01/33 2,000,000 2,073,860
3,708,893
WEST VIRGINIA (3.33%)
Braxton County, West Virginia
Weyerhaeuser
6.13%; 04/01/26 2,000,000 2,103,340
Marshall County, West Virginia
Ohio Power
5.90%; 04/01/22 1,500,000 1,523,880
Pleasants County, West Virginia
Potomac Edison
6.15%; 05/01/15 2,000,000 2,050,360
5,677,580
WISCONSIN (0.61%)
Wisconsin Health & Educational
Facilities
Franciscan Skemp Medical Center
6.13%; 11/15/15 1,000,000 1,035,740
TOTAL TAX-EXEMPT BONDS 165,334,230
Principal Amount
Value
- ----------------------------------------------------------------------------------------
OTHER (1.93%)
Blackrock Institutional Fund $2,080,000 $ 2,080,000
Merrill Lynch Institutional Tax-Exempt
Munifund 1,200,000 1,200,000
TOTAL OTHER 3,280,000
------------
TOTAL PORTFOLIO INVESTMENTS (99.07%) 168,614,230
CASH, RECEIVABLES AND OTHER ASSETS, NET OF LIABILITIES
(0.93%) 1,584,069
TOTAL NET ASSETS (100.00%) $170,198,299
--------------
UNREALIZED APPRECIATION (DEPRECIATION)
The net federal income tax unrealized appreciation (depreciation) and federal
tax cost of investments held by the fund as of the period end were as follows:
Unrealized Appreciation $ 5,190,703
Unrealized Depreciation (207,010)
------------
Net Unrealized Appreciation (Depreciation) 4,983,693
Cost for federal income tax purposes $163,630,537
INVESTMENTS BY SECTOR
Sector Value Percentage of
Total Value
- -------------------------------------------------------------------------------
$
Insured 80,476,699 47.73%
Revenue 52,652,018 31.23
Prerefunded 17,539,342 10.40
General Obligation 14,666,171 8.70
Other 3,280,000 1.94
TOTAL $168,614,230 100.00%
----------------- ------------
Percentages are adjusted to reflect the impact of currency contracts,
futures contracts, and swap agreements, if applicable.
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL BALANCED FUND, INC.
- -----------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $12.59 $11.89 $10.63 $12.17 $14.50 $15.13
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.11 0.18 0.16 0.20/(g)/ 0.29 0.32
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.32 0.71 1.26 (1.51)/(g)/ (2.13) 0.02
---- ---- ---- ----- ----- ----
Total From Investment
Operations 0.43 0.89 1.42 (1.31) (1.84) 0.34
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.13) (0.19) (0.16) (0.23) (0.28) (0.33)
Distributions from
Realized Gains...... -- -- -- -- (0.21) (0.64)
---- ----- -----
Total Dividends and
Distributions (0.13) (0.19) (0.16) (0.23) (0.49) (0.97)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $12.89 $12.59 $11.89 $10.63 $12.17 $14.50
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 3.39%/(d)/ 7.50% 13.52% (10.94)% (12.91)% 2.40%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $86,630 $85,882 $82,198 $77,483 $80,547 $94,763
Ratio of Expenses to
Average Net Assets.. 1.33%/(e)/ 1.26% 1.46% 1.42% 1.35% 1.32%
Ratio of Gross
Expenses to Average
Net Assets.......... 1.33%/(e)(f)/ 1.26%/(f)/ 1.47%/(f)/ 1.43%/(f)/ -- --
Ratio of Net
Investment Income to
Average Net Assets.. 1.73%/(e)/ 1.46% 1.42% 1.71%/(g)/ 2.14% 2.26%
Portfolio Turnover
Rate................ 133.8%/(e)/ 144.6% 117.0% 88.1% 107.5% 54.4%
2005/(C)/ 2004 2003 2002 2001 2001
---- ---- ---- ---- ---- ----
PRINCIPAL BALANCED FUND, INC.
- -----------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $12.51 $11.84 $10.59 $12.12 $14.43 $15.06
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.06 0.08 0.07 0.12/(h)/ 0.19 0.21
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.32 0.69 1.26 (1.51)/(h)/ (2.11) 0.02
---- ---- ---- ----- ----- ----
Total From Investment
Operations 0.38 0.77 1.33 (1.39) (1.92) 0.23
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.08) (0.10) (0.08) (0.14) (0.18) (0.22)
Distributions from
Realized Gains...... -- -- -- -- (0.21) (0.64)
---- ----- -----
Total Dividends and
Distributions (0.08) (0.10) (0.08) (0.14) (0.39) (0.86)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $12.81 $12.51 $11.84 $10.59 $12.12 $14.43
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 3.01%/(d)/ 6.53% 12.63% (11.55)% (13.53)% 1.61%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $15,363 $15,126 $15,405 $14,658 $17,900 $20,680
Ratio of Expenses to
Average Net Assets.. 2.12%/(e)/ 2.07% 2.25% 2.12% 2.05% 2.12%
Ratio of Gross
Expenses to Average
Net Assets.......... 2.12%/(e)(f)/ 2.07%/(f)/ 2.25%/(f)/ 2.13%/(f)/ -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.94%/(e)/ 0.66% 0.64% 1.02%/(h)/ 1.44% 1.46%
Portfolio Turnover
Rate................ 133.8%/(e)/ 144.6% 117.0% 88.1% 107.5% 54.4%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Six months ended April 30, 2005.
/(d) /Total return amounts have not been annualized.
/(e) /Computed on an annualized basis.
/(f) /Expense ratio without commission rebates.
/(g) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class A was to decrease net investment
income by $.01 per share, increase net realized and unrealized gain (loss) on
investments by $.01 per share, and decrease the ratio of net investment income
to average net assets by .09%. Prior periods have not been restated to reflect
this change in presentation.
/(h) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class B was to decrease net investment
income by $.01 per share, increase net realized and unrealized gain (loss) on
investments by $.01 per share, and decrease the ratio of net investment income
to average net assets by .08%. Prior periods have not been restated to reflect
this change in presentation.
See accompanying notes.
168
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL BOND FUND, INC.
- -------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.15 $10.99 $10.97 $11.11 $10.25 $10.66
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.20 0.43 0.45 0.51/(f)/ 0.61 0.72
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.10) 0.18 0.06 (0.11)/(f)/ 0.88 (0.40)
----- ---- ---- ----- ---- -----
Total From Investment
Operations 0.10 0.61 0.51 0.40 1.49 0.32
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.27) (0.45) (0.49) (0.54) (0.63) (0.73)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.27) (0.45) (0.49) (0.54) (0.63) (0.73)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $10.98 $11.15 $10.99 $10.97 $11.11 $10.25
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.89%/(d)/ 5.71% 4.68% 3.83% 14.96% 3.23%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $175,099 $178,911 $184,971 $186,723 $143,818 $124,630
Ratio of Expenses to
Average Net Assets.. 1.01%/(e)/ 0.94% 1.03% 1.06% 1.05% 1.06%
Ratio of Net
Investment Income to
Average Net Assets.. 3.70%/(e)/ 3.91% 4.00% 4.73%/(f)/ 5.67% 6.96%
Portfolio Turnover
Rate................ 180.3%/(e)/ 154.9% 79.7% 78.9% 152.0% 60.7%
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL BOND FUND, INC.
- -------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.15 $10.98 $10.97 $11.11 $10.24 $10.65
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.17 0.36 0.35 0.43/(g)/ 0.54 0.64
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.11) 0.18 0.07 (0.11)/(g)/ 0.88 (0.39)
----- ---- ---- ----- ---- -----
Total From Investment
Operations 0.06 0.54 0.42 0.32 1.42 0.25
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.23) (0.37) (0.41) (0.46) (0.55) (0.66)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.23) (0.37) (0.41) (0.46) (0.55) (0.66)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $10.98 $11.15 $10.98 $10.97 $11.11 $10.24
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.57%/(d)/ 4.98% 3.86% 3.07% 14.23% 2.45%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $30,470 $31,326 $33,883 $34,190 $26,348 $22,577
Ratio of Expenses to
Average Net Assets.. 1.64%/(e)/ 1.60% 1.84% 1.83% 1.68% 1.85%
Ratio of Net
Investment Income to
Average Net Assets.. 3.07%/(e)/ 3.25% 3.20% 3.95%/(g)/ 5.04% 6.16%
Portfolio Turnover
Rate................ 180.3%/(e)/ 154.9% 79.7% 78.9% 152.0% 60.7%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Six months ended April 30, 2005.
/(d) /Total return amounts have not been annualized.
/(e) /Computed on an annualized basis.
/(f) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class A was to decrease net investment
income by $.03 per share, increase net realized and unrealized gain (loss) on
investments by $.03 per share, and decrease the ratio of net investment income
to average net assets by .30%. Prior periods have not been restated to reflect
this change in presentation.
/(g) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class B was to decrease net investment
income by $.03 per share, increase net realized and unrealized gain (loss) on
investments by $.03 per share, and decrease the ratio of net investment income
to average net assets by .30%. Prior periods have not been restated to reflect
this change in presentation.
See accompanying notes.
169
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL CAPITAL VALUE FUND, INC.
- ----------------------------------
CLASS A SHARES
- --------------
Net Asset Value, Beginning of Period............. $23.61 $21.77 $18.48 $20.61 $25.04 $29.58
Income from Investment Operations:
Net Investment Income (Operating Loss) /(a)/ ... 0.18 0.24 0.21 0.22 0.20 0.34
Net Realized and Unrealized Gain (Loss) on
Investments.................................... 1.25 1.84 3.30 (2.16) (3.40) (2.10)
---- ---- ---- ----- ----- -----
Total From Investment Operations 1.43 2.08 3.51 (1.94) (3.20) (1.76)
Less Dividends and Distributions:
Dividends from Net Investment Income............ (0.28) (0.24) (0.22) (0.19) (0.30) (0.25)
Distributions from Realized Gains............... -- -- -- -- (0.93) (2.53)
---- ----- -----
Total Dividends and Distributions (0.28) (0.24) (0.22) (0.19) (1.23) (2.78)
----- ----- ----- ----- ----- -----
Net Asset Value, End of Period................... $24.76 $23.61 $21.77 $18.48 $20.61 $25.04
====== ====== ====== ====== ====== ======
Total Return /(b)/ .............................. 6.04%/(e)/ 9.61% 19.23% (9.52)% (13.31)% (6.20)%
Ratio/Supplemental Data:
Net Assets, End of Period (in thousands)........ $304,081 $311,583 $326,089 $333,016 $386,827 $452,251
Ratio of Expenses to Average Net Assets......... 1.01%/(f)/ 0.94% 1.00% 1.01% 0.95% 0.94%
Ratio of Gross Expenses to Average Net Assets
/(c)/ ......................................... 1.01%/(f)/ 0.95%/(g)/ 1.01%/(g)/ 1.01%/(g)/ -- --
Ratio of Net Investment Income to Average Net
Assets......................................... 1.42%/(f)/ 1.04% 1.05% 1.00% 0.90% 1.38%
Portfolio Turnover Rate......................... 131.7%/(f)/ 183.8% 132.1% 128.8% 126.2% 107.8%
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL CAPITAL VALUE FUND, INC.
- ----------------------------------
CLASS B SHARES
- --------------
Net Asset Value, Beginning of Period............. $23.37 $21.51 $18.30 $20.38 $24.76 $29.41
Income from Investment Operations:
Net Investment Income (Operating Loss) /(a)/ ... 0.11 0.08 0.02 0.06 0.03 0.11
Net Realized and Unrealized Gain (Loss) on
Investments.................................... 1.25 1.82 3.28 (2.12) (3.37) (2.09)
---- ---- ---- ----- ----- -----
Total From Investment Operations 1.36 1.90 3.30 (2.06) (3.34) (1.98)
Less Dividends and Distributions:
Dividends from Net Investment Income............ (0.12) (0.04) (0.09) (0.02) (0.11) (0.14)
Distributions from Realized Gains............... -- -- -- -- (0.93) (2.53)
---- ----- -----
Total Dividends and Distributions (0.12) (0.04) (0.09) (0.02) (1.04) (2.67)
----- ----- ----- ----- ----- -----
Net Asset Value, End of Period................... $24.61 $23.37 $21.51 $18.30 $20.38 $24.76
====== ====== ====== ====== ====== ======
Total Return /(b)/ .............................. 5.79%/(e)/ 8.83% 18.09% (10.13)% (13.96)% (7.03)%
Ratio/Supplemental Data:
Net Assets, End of Period (in thousands)........ $26,788 $27,213 $29,412 $27,235 $32,975 $39,017
Ratio of Expenses to Average Net Assets......... 1.54%/(f)/ 1.63% 1.97% 1.72% 1.71% 1.82%
Ratio of Gross Expenses to Average Net Assets... -- 1.64%/(g)/ 1.98%/(g)/ 1.72%/(g)/ -- --
Ratio of Net Investment Income to Average Net
Assets......................................... 0.90%/(f)/ 0.35% 0.08% 0.29% 0.15% 0.51%
Portfolio Turnover Rate......................... 131.7%/(f)/ 183.8% 132.1% 128.8% 126.2% 107.8%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without fees the Manager's voluntary expense limit. The
voluntary expense limit began on March 1, 2003.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without commission rebates.
See accompanying notes.
170
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL CASH MANAGEMENT FUND, INC.
- ------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.009 0.006 0.006 0.013 0.043 0.056
----- ----- ----- ----- ----- -----
Total From Investment
Operations 0.009 0.006 0.006 0.013 0.043 0.056
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.009) (0.006) (0.006) (0.013) (0.043) (0.056)
------ ------ ------ ------ ------ ------
Total Dividends and
Distributions (0.009) (0.006) (0.006) (0.013) (0.043) (0.056)
------ ------ ------ ------ ------ ------
Net Asset Value, End
of Period............ $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.86%/(e)/ 0.57% 0.59% 1.36% 4.44% 5.71%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $330,902 $317,340 $346,292 $397,386 $412,409 $390,154
Ratio of Expenses to
Average Net Assets.. 0.71%/(f)/ 0.68% 0.75% 0.72% 0.70% 0.70%
Ratio of Net
Investment Income to
Average Net Assets.. 1.71%/(f)/ 0.56% 0.59% 1.35% 4.33% 5.54%
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL CASH MANAGEMENT FUND, INC.
- ------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.006 0.004 0.003 0.009 0.037 0.049
----- ----- ----- ----- ----- -----
Total From Investment
Operations 0.006 0.004 0.003 0.009 0.037 0.049
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.006) (0.004) (0.003) (0.009) (0.037) (0.049)
------ ------ ------ ------ ------ ------
Total Dividends and
Distributions (0.006) (0.004) (0.003) (0.009) (0.037) (0.049)
------ ------ ------ ------ ------ ------
Net Asset Value, End
of Period............ $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.65%/(e)/ 0.39% 0.25% 0.88% 3.71% 5.01%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $3,966 $5,071 $7,695 $8,715 $6,655 $5,318
Ratio of Expenses to
Average Net Assets.. 1.12%/(f)/ 0.89% 1.09% 1.27% 1.40% 1.33%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... -- 0.96% 1.10% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 1.27%/(f)/ 0.35% 0.25% 0.87% 3.59% 4.87%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The limit
ceased on March 1, 2005.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/ /
See accompanying notes.
171
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL EQUITY INCOME FUND, INC.
- ----------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $10.22 $9.38 $8.57 $10.69 $18.40 $17.86
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.20 0.35 0.36 0.31 0.20 0.27
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.67 0.84 0.81 (2.14) (4.05) 1.68
---- ---- ---- ----- ----- ----
Total From Investment
Operations 0.87 1.19 1.17 (1.83) (3.85) 1.95
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.20) (0.35) (0.36) (0.29) (0.20) (0.27)
Distributions from
Realized Gains...... -- -- -- -- (3.66) (1.14)
---- ----- -----
Total Dividends and
Distributions (0.20) (0.35) (0.36) (0.29) (3.86) (1.41)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $10.89 $10.22 $9.38 $8.57 $10.69 $18.40
====== ====== ===== ===== ====== ======
Total Return /(b)/ ... 8.54%/(e)/ 12.95% 13.86% (17.30)% (25.74)% 12.09%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $81,049 $69,482 $60,703 $57,881 $72,581 $101,352
Ratio of Expenses to
Average Net Assets.. 1.30%/(f)/ 1.27% 1.46% 1.48% 1.31% 1.23%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.30%/(f)/ 1.27% -- -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 3.82%/(f)/ 3.56% 4.02% 3.15% 1.51% 1.59%
Portfolio Turnover
Rate................ 84.1%/(f)/ 134.7% 19.1% 79.4% 106.2% 150.8%
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL EQUITY INCOME FUND, INC.
- ----------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $10.18 $9.34 $8.53 $10.64 $18.37 $17.83
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.16 0.26 0.28 0.21 0.10 0.14
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.66 0.85 0.80 (2.11) (4.07) 1.69
---- ---- ---- ----- ----- ----
Total From Investment
Operations 0.82 1.11 1.08 (1.90) (3.97) 1.83
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.16) (0.27) (0.27) (0.21) (0.10) (0.15)
Distributions from
Realized Gains...... -- -- -- -- (3.66) (1.14)
---- ----- -----
Total Dividends and
Distributions (0.16) (0.27) (0.27) (0.21) (3.76) (1.29)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $10.84 $10.18 $9.34 $8.53 $10.64 $18.37
====== ====== ===== ===== ====== ======
Total Return /(b)/ ... 8.06%/(e)/ 12.06% 12.85% (18.02)% (26.41)% 11.30%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $12,774 $11,415 $9,775 $9,982 $15,152 $19,624
Ratio of Expenses to
Average Net Assets.. 2.10%/(f)/ 2.10% 2.34% 2.37% 2.15% 2.00%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.13%/(f)/ 2.10% -- -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 3.00%/(f)/ 2.72% 3.14% 2.19% 0.66% 0.82%
Portfolio Turnover
Rate................ 84.1%/(f)/ 134.7% 19.1% 79.4% 106.2% 150.8%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit began on March 1, 2004.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
See accompanying notes.
172
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL GOVERNMENT SECURITIES
- -------------------------------
INCOME FUND, INC.
- -----------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.37 $11.41 $11.74 $11.77 $11.18 $11.10
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.18 0.43 0.45 0.60 0.65 0.68
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.09) 0.01 (0.26) 0.01 0.61 0.07
----- ---- ----- ---- ---- ----
Total From Investment
Operations 0.09 0.44 0.19 0.61 1.26 0.75
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.20) (0.48) (0.52) (0.64) (0.67) (0.67)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.20) (0.48) (0.52) (0.64) (0.67) (0.67)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $11.26 $11.37 $11.41 $11.74 $11.77 $11.18
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.76%/(d)/ 3.93% 1.59% 5.41% 11.64% 7.09%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $259,593 $274,876 $304,191 $310,506 $243,876 $213,114
Ratio of Expenses to
Average Net Assets.. 0.90%/(e)/ 0.82% 0.93% 0.90% 0.90% 0.94%
Ratio of Net
Investment Income to
Average Net Assets.. 3.17%/(e)/ 3.79% 3.82% 5.11% 5.68% 6.14%
Portfolio Turnover
Rate................ 395.5%/(e)/ 72.7% 181.1% 36.5% 51.9% 6.9%
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL GOVERNMENT SECURITIES
- -------------------------------
INCOME FUND, INC.
- -----------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.30 $11.35 $11.67 $11.71 $11.13 $11.05
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.13 0.34 0.35 0.52 0.58 0.58
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.08) -- (0.24) (0.01) 0.59 0.09
---- ----- ----- ----- ---- ----
Total From Investment
Operations 0.05 0.34 0.11 0.51 1.17 0.67
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.15) (0.39) (0.43) (0.55) (0.59) (0.59)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.15) (0.39) (0.43) (0.55) (0.59) (0.59)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $11.20 $11.30 $11.35 $11.67 $11.71 $11.13
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.46%/(d)/ 3.07% 0.91% 4.54% 10.82% 6.32%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $52,582 $53,901 $62,573 $52,839 $36,303 $27,395
Ratio of Expenses to
Average Net Assets.. 1.68%/(e)/ 1.60% 1.70% 1.71% 1.59% 1.75%
Ratio of Net
Investment Income to
Average Net Assets.. 2.40%/(e)/ 3.01% 3.06% 4.30% 4.98% 5.33%
Portfolio Turnover
Rate................ 395.5%/(e)/ 72.7% 181.1% 36.5% 51.9% 6.9%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Six months ended April 30, 2005.
/(d) /Total return amounts have not been annualized.
/(e) /Computed on an annualized basis.
See accompanying notes.
173
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL GROWTH FUND, INC.
- ---------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $26.31 $25.44 $22.10 $27.06 $71.22 $65.57
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.08 (0.08) (0.09) (0.18) (0.30) (0.37)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.97 0.95 3.43 (4.78) (21.79) 8.43
---- ---- ---- ----- ------ ----
Total From Investment
Operations 1.05 0.87 3.34 (4.96) (22.09) 8.06
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- -- (22.07) (2.41)
---- ------ -----
Total Dividends and
Distributions -- -- -- -- (22.07) (2.41)
---- ------ -----
Net Asset Value, End
of Period............ $27.36 $26.31 $25.44 $22.10 $27.06 $71.22
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 3.99%/(d)/ 3.42% 15.11% (18.33)% (41.87)% 12.64%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $250,483 $252,694 $263,119 $243,504 $291,541 $525,175
Ratio of Expenses to
Average Net Assets.. 1.22%/(e)/ 1.15% 1.37% 1.41% 1.30% 1.08%
Ratio of Gross
Expenses to Average
Net Assets.......... -- 1.15%/(f)/ 1.37%/(f)/ -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.58%/(e)/ (0.30)% (0.42)% (0.66)% (0.71)% (0.52)%
Portfolio Turnover
Rate................ 215.0%/(e)/ 52.7% 46.6%/(g)/ 22.4% 33.4% 121.5%
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL GROWTH FUND, INC.
- ---------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $25.12 $24.49 $21.45 $26.43 $70.41 $65.33
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.03) (0.28) (0.28) (0.41) (0.24) (0.89)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.94 0.91 3.32 (4.57) (21.67) 8.38
---- ---- ---- ----- ------ ----
Total From Investment
Operations 0.91 0.63 3.04 (4.98) (21.91) 7.49
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- -- (22.07) (2.41)
---- ------ -----
Total Dividends and
Distributions -- -- -- -- (22.07) (2.41)
---- ------ -----
Net Asset Value, End
of Period............ $26.03 $25.12 $24.49 $21.45 $26.43 $70.41
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 3.62%/(d)/ 2.57% 14.17% (18.84)% (42.21)% 11.79%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $37,441 $40,469 $47,163 $48,214 $64,111 $110,001
Ratio of Expenses to
Average Net Assets.. 2.07%/(e)/ 1.95% 2.22% 2.05% 1.88% 1.85%
Ratio of Gross
Expenses to Average
Net Assets.......... -- 1.96%/(f)/ 2.22%/(f)/ -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. (0.24)%/(e)/ (1.11)% (1.27)% (1.30)% (1.29)% (1.30)%
Portfolio Turnover
Rate................ 215.0%/(e)/ 52.7% 46.6%/(g)/ 22.4% 33.4% 121.5%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Six months ended April 30, 2005.
/(d) /Total return amounts have not been annualized.
/(e) /Computed on an annualized basis.
/(f) /Expense ratio without commission rebates.
/(g) /Portfolio turnover rate excludes portfolio realignment of approximately
$7,623,000 from the acquisition of Principal Partners LargeCap Growth Fund,
Inc.
See accompanying notes.
174
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL EMERGING
- --------------------------------
MARKETS FUND, INC.
- ------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.91 $10.16 $6.77 $6.44 $8.75 $8.56
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.05 0.03 0.01 (0.05) (0.03) (0.10)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.76 1.72 3.38 0.38 (2.22) 0.31
---- ---- ---- ---- ----- ----
Total From Investment
Operations 1.81 1.75 3.39 0.33 (2.25) 0.21
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- -- -- -- -- (0.02)
Distributions from
Realized Gains...... (0.71) -- -- -- (0.06) --
---- ----- -----
Total Dividends and
Distributions (0.71) -- -- -- (0.06) (0.02)
---- ----- ----- -----
Net Asset Value, End
of Period............ $13.01 $11.91 $10.16 $6.77 $6.44 $8.75
====== ====== ====== ===== ===== =====
Total Return /(b)/ ... 15.39%/(e)/ 17.22% 50.07% 5.12% (25.85)% 2.36%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $46,017 $37,804 $26,909 $18,029 $15,335 $17,890
Ratio of Expenses to
Average Net Assets.. 2.40%/(f)/ 2.32% 2.57% 2.48% 2.50% 2.49%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.41%/(f)(g)/ 2.34%/(h)/ 2.70%/(h)/ 2.77%/(h)/ 2.71% 2.59%
Ratio of Net
Investment Income to
Average Net Assets.. 0.73%/(f)/ 0.29% 0.12% (0.36)% (0.06)% (1.05)%
Portfolio Turnover
Rate................ 214.0%/(f)/ 147.5% 117.3% 165.4% 120.5% 112.9%
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL EMERGING
- --------------------------------
MARKETS FUND, INC.
- ------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.36 $9.76 $6.56 $6.28 $8.60 $8.47
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. -- (0.03) (0.05) (0.06) (0.05) (0.16)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.70 1.63 3.25 0.34 (2.21) 0.29
---- ---- ---- ---- ----- ----
Total From Investment
Operations 1.70 1.60 3.20 0.28 (2.26) 0.13
Less Dividends and
Distributions:
Distributions from
Realized Gains...... (0.71) -- -- -- (0.06) --
---- ----- -----
Total Dividends and
Distributions (0.71) -- -- -- (0.06) --
---- ----- -----
Net Asset Value, End
of Period............ $12.35 $11.36 $9.76 $6.56 $6.28 $8.60
====== ====== ===== ===== ===== =====
Total Return /(b)/ ... 15.16%/(e)/ 16.39% 48.78% 4.46% (26.42)% 1.53%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $7,696 $6,148 $7,710 $5,241 $4,728 $6,198
Ratio of Expenses to
Average Net Assets.. 3.07%/(f)/ 2.96% 3.29% 3.23% 3.25% 3.22%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 3.08%/(f)(g)/ 2.98%/(h)/ 3.42%/(h)/ 3.50%/(h)/ 3.39% 3.22%
Ratio of Net
Investment Income to
Average Net Assets.. 0.06%/(f)/ (0.31)% (0.61)% (1.13)% (0.84)% (1.78)%
Portfolio Turnover
Rate................ 214.0%/(f)/ 147.5% 117.3% 165.4% 120.5% 112.9%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge/./
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit began on the first day of the period ended October 31, 2000. Expense
limits were increased on March 1, 2003 and ceased on March 1, 2004.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without custodian credits.
/(h) /Expense ratio without commission rebates and custodian credits.
See accompanying notes.
175
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL FUND, INC.
- ----------------------------------
CLASS A SHARES
- --------------
Net Asset Value, Beginning of Period... $7.18 $6.20 $5.05 $5.75 $8.85 $10.04
Income from Investment Operations:
Net Investment Income (Operating Loss)
/(a)/ ............................... 0.05 0.05 0.04 0.02 0.02 0.16
Net Realized and Unrealized Gain
(Loss) on Investments................ 0.71 0.98 1.11 (0.71) (2.34) 0.20
---- ---- ---- ----- ----- ----
Total From Investment Operations 0.76 1.03 1.15 (0.69) (2.32) 0.36
Less Dividends and Distributions:
Dividends from Net Investment Income.. (0.07) (0.05) -- (0.01) (0.05) (0.23)
Distributions from Realized Gains..... -- -- -- -- (0.73) (1.32)
---- ----- -----
Total Dividends and Distributions (0.07) (0.05) -- (0.01) (0.78) (1.55)
---- ----- ----- ----- ----- -----
Net Asset Value, End of Period......... $7.87 $7.18 $6.20 $5.05 $5.75 $8.85
===== ===== ===== ===== ===== =====
Total Return /(b)/ .................... 10.52%/(e)/ 16.73% 22.81% (11.94)% (28.64)% 3.04%
Ratio/Supplemental Data:
Net Assets, End of Period (in
thousands)........................... $222,630 $212,752 $200,005 $197,946 $224,177 $325,369
Ratio of Expenses to Average Net
Assets............................... 1.50%/(f)/ 1.41% 1.55% 1.57% 1.42% 1.27%
Ratio of Gross Expenses to Average Net
Assets /(c)/......................... 1.50%/(f)(g)/ 1.42%/(h)/ 1.55%/(h)/ 1.57%/(h)/ -- --
Ratio of Net Investment Income to
Average Net Assets................... 1.17%/(f)/ 0.81% 0.84% 0.32% 0.27% 1.76%
Portfolio Turnover Rate............... 134.9%/(f)/ 163.8% 100.8%/(i)/ 73.5% 93.9% 92.7%
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL FUND, INC.
- ----------------------------------
CLASS B SHARES
- --------------
Net Asset Value, Beginning of Period... $7.04 $6.05 $4.98 $5.71 $8.78 $9.96
Income from Investment Operations:
Net Investment Income (Operating Loss)
/(a)/ ............................... 0.03 0.02 (0.01) (0.03) (0.03) 0.11
Net Realized and Unrealized Gain
(Loss) on Investments................ 0.69 0.97 1.08 (0.70) (2.31) 0.20
---- ---- ---- ----- ----- ----
Total From Investment Operations 0.72 0.99 1.07 (0.73) (2.34) 0.31
Less Dividends and Distributions:
Dividends from Net Investment Income.. (0.03) -- -- -- -- (0.17)
Distributions from Realized Gains..... -- -- -- -- (0.73) (1.32)
---- ----- -----
Total Dividends and Distributions (0.03) -- -- -- (0.73) (1.49)
---- ----- ----- -----
Net Asset Value, End of Period......... $7.73 $7.04 $6.05 $4.98 $5.71 $8.78
===== ===== ===== ===== ===== =====
Total Return /(b)/ .................... 10.25%/(e)/ 16.36% 21.49% (12.78)% (28.97)% 2.43%
Ratio/Supplemental Data:
Net Assets, End of Period (in
thousands)........................... $27,603 $26,782 $28,498 $28,607 $33,277 $48,692
Ratio of Expenses to Average Net
Assets............................... 1.86%/(f)/ 1.91% 2.47% 2.39% 2.08% 1.88%
Ratio of Gross Expenses to Average Net
Assets............................... 1.86%/(f)(g)/ 1.92%/(h)/ 2.47%/(h)/ 2.40%/(h)/ -- --
Ratio of Net Investment Income to
Average Net Assets................... 0.79%/(f)/ 0.29% (0.13)% (0.50)% (0.41)% 1.13%
Portfolio Turnover Rate............... 134.9%/(f)/ 163.8% 100.8%/(i)/ 73.5% 93.9% 92.7%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The
voluntary expense limit began on March 1, 2003.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without custodian credits.
/(h) /Expense ratio without commission rebates and custodian credits.
/(i) /Portfolio turnover rate excludes portfolio realignment of approximately
$4,997,000 from the acquisition of Principal European Equity Fund, Inc. and
Principal Pacific Basin Fund, Inc.
See accompanying notes.
176
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL SMALLCAP FUND, INC.
- -------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $14.90 $11.84 $8.39 $9.49 $17.00 $15.32
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.01 0.00 (0.02) (0.05) (0.23) (0.32)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.96 3.06 3.47 (1.05) (4.62) 3.51
---- ---- ---- ----- ----- ----
Total From Investment
Operations 1.97 3.06 3.45 (1.10) (4.85) 3.19
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- -- (0.01) -- -- --
Distributions from
Realized Gains...... -- -- -- -- (2.66) (1.51)
-- -- -- -- ----- -----
Total Dividends and
Distributions -- -- (0.01) -- (2.66) (1.51)
---- ----- ----- -----
Redemption Fees /(a)/ -- -- 0.01 -- -- --
---- ----
Net Asset Value, End
of Period............ $16.87 $14.90 $11.84 $8.39 $9.49 $17.00
====== ====== ====== ===== ===== ======
Total Return /(b)/ ... 13.23%/(e)/ 25.84% 41.22% (11.59)% (33.02)% 21.21%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $57,240 $47,717 $35,588 $26,821 $28,977 $36,322
Ratio of Expenses to
Average Net Assets.. 2.00%/(f)/ 2.07% 2.62% 2.49% 2.74% 2.46%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.21%/(f)(g)/ 2.13%/(h)/ 2.63%/(h)/ 2.49%/(h)/ -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.11%/(f)/ 0.02% (0.22)% (0.35)% (1.08)% (1.41)%
Portfolio Turnover
Rate................ 123.3%/(f)/ 134.0% 144.5% 80.3% 151.6% 329.8%
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL SMALLCAP FUND, INC.
- -------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $14.13 $11.31 $8.08 $9.23 $16.72 $15.18
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.05) (0.10) (0.09) (0.13) (0.05) (0.41)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.86 2.92 3.32 (1.02) (4.78) 3.46
---- ---- ---- ----- ----- ----
Total From Investment
Operations 1.81 2.82 3.23 (1.15) (4.83) 3.05
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- -- (2.66) (1.51)
---- ----- -----
Total Dividends and
Distributions -- -- -- -- (2.66) (1.51)
---- ----- -----
Net Asset Value, End
of Period............ $15.94 $14.13 $11.31 $8.08 $9.23 $16.72
====== ====== ====== ===== ===== ======
Total Return /(b)/ ... 12.81%/(e)/ 24.93% 39.98% (12.46)% (33.52)% 20.43%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $15,264 $13,358 $10,251 $7,536 $8,641 $12,539
Ratio of Expenses to
Average Net Assets.. 2.75%/(f)/ 2.83% 3.44% 3.40% 3.46% 3.04%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.86%/(f)(g)/ 2.91%/(h)/ 3.46%/(h)/ 3.41%/(h)/ -- --
Ratio of Net
Investment Income to
Average Net Assets.. (0.65)%/(f)/ (0.74)% (1.05)% (1.27)% (1.83)% --
Portfolio Turnover
Rate................ 123.3%/(f)/ 134.0% 144.5% 80.3% 151.6% 329.8%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit began on March 1, 2004.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without custodian credits.
/(h) /Expense ratio without commission rebates and custodian credits.
See accompanying notes.
177
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000/(G)/
---- ---- ---- ---- ---- ----
PRINCIPAL LARGECAP STOCK INDEX FUND, INC.
- -----------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $8.39 $7.80 $6.57 $7.85 $10.59 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.06 0.06 0.06 0.05 0.05 0.03
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.18 0.59 1.22 (1.29) (2.74) 0.56
---- ---- ---- ----- ----- ----
Total From Investment
Operations 0.24 0.65 1.28 (1.24) (2.69) 0.59
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.09) (0.06) (0.05) (0.04) (0.05) --
---- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.09) (0.06) (0.05) (0.04) (0.05) --
---- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $8.54 $8.39 $7.80 $6.57 $7.85 $10.59
===== ===== ===== ===== ===== ======
Total Return /(b)/ ... 2.82%/(e)/ 8.37% 19.62% (15.92)% (25.46)% 4.96%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $69,125 $53,384 $41,913 $33,538 $15,886 $9,855
Ratio of Expenses to
Average Net Assets.. 0.90%/(f)/ 0.90% 0.90% 0.90% 0.90% 0.79%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.02%/(f)/ 1.01% 1.25% 1.20% 1.44% 1.82%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 1.46%/(f)/ 0.78% 0.89% 0.65% 0.59% 0.76%/(f)/
Portfolio Turnover
Rate................ 17.7%/(f)/ 32.3% 20.1% 19.3% 39.3% 189.7%/(f)/
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit began on the first day of the period ended October 31, 2000. The expense
limit was increased on November 1, 2000.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Period from March 1, 2000, date shares first offered, through October 31,
2000.
See accompanying notes.
178
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL LIMITED TERM BOND FUND, INC.
- --------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $9.50 $9.74 $9.86 $9.98 $9.50 $9.54
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.13 0.26 0.29 0.43/(g)/ 0.56 0.59
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.11) (0.09) 0.01 (0.08)/(g)/ 0.49 (0.05)
----- ----- ---- ----- ---- -----
Total From Investment
Operations 0.02 0.17 0.30 0.35 1.05 0.54
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.18) (0.41) (0.42) (0.47) (0.57) (0.58)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.18) (0.41) (0.42) (0.47) (0.57) (0.58)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $9.34 $9.50 $9.74 $9.86 $9.98 $9.50
===== ===== ===== ===== ===== =====
Total Return /(b)/ ... 0.23%/(e)/ 1.77% 3.04% 3.70% 11.36% 5.94%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $130,794 $122,451 $96,568 $74,719 $37,942 $25,183
Ratio of Expenses to
Average Net Assets.. 0.86%/(f)/ 0.86% 0.93% 0.94% 1.01% 0.99%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... -- -- -- -- -- 1.20%
Ratio of Net
Investment Income to
Average Net Assets.. 2.79%/(f)/ 2.71% 3.02% 4.07%/(g)/ 5.69% 6.16%
Portfolio Turnover
Rate................ 94.4%/(f)/ 42.0% 26.2% 97.6% 65.7% 31.5%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit ceased on November 1, 2000.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class A was to decrease net investment
income by $.07 per share, increase net realized and unrealized gain (loss) on
investments by $.07 per share, and decrease the ratio of net investment income
to average net assets by 1.81%. Prior periods have not been restated to
reflect this change in presentation.
See accompanying notes.
179
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL MIDCAP FUND, INC.
- ---------------------------
CLASS A SHARES
- --------------
Net Asset Value, Beginning of Period..... $42.87 $39.20 $31.01 $33.08 $52.01 $42.12
Income from Investment Operations:
Net Investment Income (Operating Loss)
/(a)/ ................................. 0.27 0.32 0.09 0.08 (0.02) (0.16)
Net Realized and Unrealized Gain (Loss)
on Investments......................... 1.54 5.40 8.20 (1.09) (3.75) 12.08
---- ---- ---- ----- ----- -----
Total From Investment Operations 1.81 5.72 8.29 (1.01) (3.77) 11.92
Less Dividends and Distributions:
Dividends from Net Investment Income.... (0.23) (0.18) (0.10) (0.07) -- --
Distributions from Realized Gains....... (3.93) (1.87) -- (0.99) (15.16) (2.03)
---- ----- ----- ----- ------ -----
Total Dividends and Distributions (4.16) (2.05) (0.10) (1.06) (15.16) (2.03)
----- ----- ----- ----- ------ -----
Net Asset Value, End of Period........... $40.52 $42.87 $39.20 $31.01 $33.08 $52.01
====== ====== ====== ====== ====== ======
Total Return /(b)/ ...................... 4.03%/(d)/ 15.10% 26.81% (3.36)% (9.14)% 29.21%
Ratio/Supplemental Data:
Net Assets, End of Period (in thousands) $477,080 $459,207 $396,239 $319,410 $319,523 $364,639
Ratio of Expenses to Average Net Assets. 1.02%/(e)/ 1.02% 1.19% 1.24% 1.16% 1.17%
Ratio of Gross Expenses to Average Net
Assets................................. -- 1.02%/(f)/ 1.19%/(f)/ 1.25%/(f)/ -- --
Ratio of Net Investment Income to
Average Net Assets..................... 1.30%/(e)/ 0.78% 0.28% 0.27% 0.20% (0.36)%
Portfolio Turnover Rate................. 48.3%/(e)/ 38.8% 50.4% 76.2% 66.6% 161.8%
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL MIDCAP FUND, INC.
- ---------------------------
CLASS B SHARES
- --------------
Net Asset Value, Beginning of Period..... $40.82 $37.35 $29.59 $31.75 $50.71 $41.29
Income from Investment Operations:
Net Investment Income (Operating Loss)
/(a)/ ................................. 0.20 0.19 (0.05) (0.15) 0.22 (0.42)
Net Realized and Unrealized Gain (Loss)
on Investments......................... 1.50 5.15 7.81 (1.02) (4.02) 11.87
---- ---- ---- ----- ----- -----
Total From Investment Operations 1.70 5.34 7.76 (1.17) (3.80) 11.45
Less Dividends and Distributions:
Dividends from Net Investment Income.... (0.13) -- -- -- -- --
Distributions from Realized Gains....... (3.93) (1.87) -- (0.99) (15.16) (2.03)
---- ----- ----- ----- ------ -----
Total Dividends and Distributions (4.06) (1.87) -- (0.99) (15.16) (2.03)
---- ----- ----- ----- ------ -----
Net Asset Value, End of Period........... $38.46 $40.82 $37.35 $29.59 $31.75 $50.71
====== ====== ====== ====== ====== ======
Total Return /(b)/ ...................... 3.94%/(d)/ 14.78% 26.23% (4.00)% (9.55)% 28.63%
Ratio/Supplemental Data:
Net Assets, End of Period (in thousands) $73,188 $72,746 $70,586 $64,538 $71,330 $80,721
Ratio of Expenses to Average Net Assets. 1.29%/(e)/ 1.32% 1.64% 1.90% 1.61% 1.62%
Ratio of Gross Expenses to Average Net
Assets.......... -- 1.32%/(f)/ 1.64%/(f)/ 1.90%/(f)/ -- --
Ratio of Net Investment Income to
Average Net Assets..................... 1.03%/(e)/ 0.49% (0.16)% (0.39)% (0.25)% (0.80)%
Portfolio Turnover Rate................. 48.3%/(e)/ 38.8% 50.4% 76.2% 66.6% 161.8%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Six months ended April 30, 2005.
/(d) /Total return amounts have not been annualized.
/(e) /Computed on an annualized basis.
/(f) /Expense ratio without commission rebates.
See accompanying notes.
180
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(E)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL PARTNERS BLUE CHIP FUND, INC.
- ---------------------------------------
CLASS A SHARES
- --------------
Net Asset Value, Beginning of Period............. $17.57 $16.16 $13.59 $17.04 $24.26 $25.25
Income from Investment Operations:
Net Investment Income (Operating Loss) /(a)/ ... 0.11 0.05 -- (0.02) (0.02) 0.04
Net Realized and Unrealized Gain (Loss) on
Investments.................................... 0.44 1.36 2.57 (3.42) (6.84) (0.69)
---- ---- ---- ----- ----- -----
Total From Investment Operations 0.55 1.41 2.57 (3.44) (6.86) (0.65)
Less Dividends and Distributions:
Dividends from Net Investment Income............ (0.13) -- -- -- -- (0.05)
Distributions from Realized Gains............... -- -- -- -- (0.33) (0.29)
Tax Return of Capital Distributions /(b)/ ...... -- -- -- (0.01) (0.03) --
---- ----- -----
Total Dividends and Distributions (0.13) -- -- (0.01) (0.36) (0.34)
---- ----- ----- ----- -----
Net Asset Value, End of Period................... $17.99 $17.57 $16.16 $13.59 $17.04 $24.26
====== ====== ====== ====== ====== ======
Total Return /(c)/ .............................. 3.09%/(f)/ 8.73% 18.91% (20.19)% (28.63)% (2.60)%
Ratio/Supplemental Data:
Net Assets, End of Period (in thousands)........ $123,560 $123,304 $117,931 $104,481 $120,173 $170,462
Ratio of Expenses to Average Net Assets......... 1.33%/(g)/ 1.25% 1.68% 1.54% 1.50% 1.19%
Ratio of Gross Expenses to Average Net Assets
/(d)/ ......................................... -- 1.25%/(h)/ 1.69%/(h)/ 1.54%/(h)/ -- 1.33%
Ratio of Net Investment Income to Average Net
Assets......................................... 1.17%/(g)/ 0.29% 0.00% (0.08)% (0.10)% 0.19%
Portfolio Turnover Rate......................... 69.3%/(g)/ 66.7% 87.6% 79.8% 74.4% 73.6%
2005/(E)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL PARTNERS BLUE CHIP FUND, INC.
- ---------------------------------------
CLASS B SHARES
- --------------
Net Asset Value, Beginning of Period............. $16.83 $15.60 $13.22 $16.65 $23.89 $25.00
Income from Investment Operations:
Net Investment Income (Operating Loss) /(a)/ ... 0.03 (0.08) (0.11) (0.13) (0.16) (0.14)
Net Realized and Unrealized Gain (Loss) on
Investments.................................... 0.41 1.31 2.49 (3.30) (6.72) (0.67)
---- ---- ---- ----- ----- -----
Total From Investment Operations 0.44 1.23 2.38 (3.43) (6.88) (0.81)
Less Dividends and Distributions:
Dividends from Net Investment Income............ -- -- -- -- 0.00 (0.01)
Distributions from Realized Gains............... -- -- -- -- (0.33) (0.29)
Tax Return of Capital Distributions /(b)/ ...... -- -- -- -- (0.03) --
---- -----
Total Dividends and Distributions -- -- -- -- (0.36) (0.30)
---- ----- -----
Net Asset Value, End of Period................... $17.27 $16.83 $15.60 $13.22 $16.65 $23.89
====== ====== ====== ====== ====== ======
Total Return /(c)/ .............................. 2.61%/(f)/ 7.88% 18.00% (20.60)% (29.16)% (3.30)%
Ratio/Supplemental Data:
Net Assets, End of Period (in thousands)........ $24,173 $26,399 $29,233 $27,704 $38,531 $54,550
Ratio of Expenses to Average Net Assets......... 2.14%/(g)/ 2.05% 2.46% 2.10% 2.21% 1.94%
Ratio of Gross Expenses to Average Net Assets
/(d)/ ......................................... -- 2.05%/(h)/ 2.47%/(h)/ 2.10%/(h)/ -- 2.05%
Ratio of Net Investment Income to Average Net
Assets......................................... 0.40%/(g)/ (0.50)% (0.78)% (0.64)% (0.81)% (0.56)%
Portfolio Turnover Rate......................... 69.3%/(g)/ 66.7% 87.6% 79.8% 74.4% 73.6%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /See "Distributions to Shareholders" in the Notes to Financial Statements.
/(c) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(d) /Expense ratio without the Manager's voluntary expense limit. The expense
limit was effective for the year ended October 31, 2000.
/(e) /Six months ended April 30, 2005.
/(f) /Total return amounts have not been annualized.
/(g) /Computed on an annualized basis.
/(h) /Expense ratio without commission rebates.
See accompanying notes.
181
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL PARTNERS EQUITY GROWTH FUND, INC.
- -------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $7.24 $7.00 $6.12 $7.62 $11.36 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.01 (0.05) (0.05) (0.10) (0.10) (0.05)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.01) 0.29 0.93 (1.40) (3.64) 1.41
----- ---- ---- ----- ----- ----
Total From Investment
Operations -- 0.24 0.88 (1.50) (3.74) 1.36
---- ---- ---- ----- ----- ----
Net Asset Value, End
of Period............ $7.24 $7.24 $7.00 $6.12 $7.62 $11.36
===== ===== ===== ===== ===== ======
Total Return /(b)/ ... 0.00%/(e)/ 3.43% 14.38% (19.69)% (32.92)% 13.60%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $44,684 $45,100 $43,061 $37,451 $38,303 $49,794
Ratio of Expenses to
Average Net Assets.. 1.64%/(f)/ 1.59% 1.89% 1.98% 1.90% 1.57%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.64%/(f)/ 1.65%/(g)/ 1.99%/(g)/ -- -- 1.99%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 0.23%/(f)/ (0.68)% (0.74)% (1.07)% (1.10)% (0.68)%/(f)/
Portfolio Turnover
Rate................ 77.9%/(f)/ 160.3% 124.7% 138.9% 86.4% 62.0%/(f)/
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL PARTNERS EQUITY GROWTH FUND, INC.
- -------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $6.97 $6.79 $5.99 $7.52 $11.28 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.02) (0.10) (0.09) (0.11) (0.13) (0.10)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... -- 0.28 0.89 (1.42) (3.63) 1.38
---- ---- ---- ----- ----- ----
Total From Investment
Operations (0.02) 0.18 0.80 (1.53) (3.76) 1.28
----- ---- ---- ----- ----- ----
Net Asset Value, End
of Period............ $6.95 $6.97 $6.79 $5.99 $7.52 $11.28
===== ===== ===== ===== ===== ======
Total Return /(b)/ ... (0.29)%/(e)/ 2.65% 13.36% (20.35)% (33.33)% 12.80%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $14,560 $15,066 $14,849 $12,939 $15,419 $19,430
Ratio of Expenses to
Average Net Assets.. 2.39%/(f)/ 2.31% 2.65% 2.76% 2.63% 2.31%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.39%/(f)/ 2.37%/(g)/ 2.72%/(g)/ -- -- 2.61%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (0.50)%/(f)/ (1.39)% (1.50)% (1.85)% (1.82)% (1.41)%/(f)/
Portfolio Turnover
Rate................ 77.9%/(f)/ 160.3% 124.7% 138.9% 86.4% 62.0%/(f)/
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit was effective for the year ended October 31, 2000. The expense limit
began again on March 1, 2003 and decreased on March 1, 2004.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without commission rebates.
See accompanying notes.
182
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001/(H)/
---- ---- ---- ---- ----
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
- --------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $9.89 $9.14 $7.97 $9.00 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.04 0.01 -- (0.01) --
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.26 0.74 1.17 (1.02) (1.00)
---- ---- ---- ----- -----
Total From Investment
Operations 0.30 0.75 1.17 (1.03) (1.00)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.05) -- -- -- --
Distributions from
Realized Gains...... (0.31) -- -- -- --
-----
Total Dividends and
Distributions (0.36) -- -- -- --
----- -----
Net Asset Value, End
of Period............ $9.83 $9.89 $9.14 $7.97 $9.00
===== ===== ===== ===== =====
Total Return /(b)/ ... 2.96%/(e)/ 8.21% 14.68% (11.44)% (10.00)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $48,397 $43,210 $33,155 $18,781 $7,694
Ratio of Expenses to
Average Net Assets.. 1.45%/(f)/ 1.47% 1.79% 1.95% 1.95%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.51%/(f)/ 1.52%/(g)/ 1.82%/(g)/ 1.98%/(g)/ 2.25%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 0.86%/(f)/ 0.11% 0.06% (0.02)% (0.09)%/(f)/
Portfolio Turnover
Rate................ 44.3%/(f)/ 100.0% 33.0% 67.5% 56.9%/(f)/
2005/(D)/ 2004 2003 2002 2002/(H)/
---- ---- ---- ---- ----
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
- --------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $9.62 $8.95 $7.87 $8.94 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.01 (0.06) (0.05) (0.03) (0.04)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.24 0.73 1.13 (1.04) (1.02)
---- ---- ---- ----- -----
Total From Investment
Operations 0.25 0.67 1.08 (1.07) (1.06)
Less Dividends and
Distributions:
Distributions from
Realized Gains...... (0.31) -- -- -- --
-----
Total Dividends and
Distributions (0.31) -- -- -- --
----- -----
Net Asset Value, End
of Period............ $9.56 $9.62 $8.95 $7.87 $8.94
===== ===== ===== ===== =====
Total Return /(b)/ ... 2.55%/(e)/ 7.49% 13.72% (11.97)% (10.60)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $21,424 $18,438 $14,702 $6,552 $2,670
Ratio of Expenses to
Average Net Assets.. 2.20%/(f)/ 2.21% 2.49% 2.70% 2.70%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.21%/(f)/ 2.24%/(g)/ 2.55%/(g)/ 2.78%/(g)/ 3.01%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 0.10%/(f)/ (0.63)% (0.64)% (0.77)% (0.84)%/(f)/
Portfolio Turnover
Rate................ 44.3%/(f)/ 100.0% 33.0% 67.5% 56.9%/(f)/
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. Expense
limits for each class were decreased on March 1, 2003 and March 1, 2004.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without commission rebates.
(h) Period from December 22, 2000, date shares first offered, through October
31, 2001.
See accompanying notes.
183
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001/(H)/
---- ---- ---- ---- ----
PRINCIPAL PARTNERS LARGECAP VALUE FUND, INC.
- --------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $12.14 $10.94 $8.89 $9.98 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.07 0.09 0.08 0.03 0.02
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.50 1.18 2.00 (1.00) (0.04)
---- ---- ---- ----- -----
Total From Investment
Operations 0.57 1.27 2.08 (0.97) (0.02)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.11) (0.07) (0.03) (0.03) --
Distributions from
Realized Gains...... (0.17) -- -- (0.09) --
----- -----
Total Dividends and
Distributions (0.28) (0.07) (0.03) (0.12) --
----- -----
Net Asset Value, End
of Period............ $12.43 $12.14 $10.94 $8.89 $9.98
====== ====== ====== ===== =====
Total Return /(b)/ ... 4.63%/(e)/ 11.67% 23.51% (9.89)% (0.20)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $48,959 $43,517 $34,298 $21,677 $8,146
Ratio of Expenses to
Average Net Assets.. 1.45%/(f)/ 1.46% 1.73% 1.90% 1.95%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.50%/(f)/ 1.50%/(g)/ 1.76%/(g)/ 1.90%/(g)/ 2.04%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 1.05%/(f)/ 0.80% 0.81% 0.45% 0.43%/(f)/
Portfolio Turnover
Rate................ 24.3%/(f)/ 27.0% 18.5% 10.5% 35.1%/(f)/
2005/(D)/ 2004 2003 2002 2001/(H)/
---- ---- ---- ---- ----
PRINCIPAL PARTNERS LARGECAP VALUE FUND, INC.
- --------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.95 $10.78 $8.79 $9.92 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.02 0.01 0.01 (0.01) (0.02)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.48 1.16 1.98 (1.03) (0.06)
---- ---- ---- ----- -----
Total From Investment
Operations 0.50 1.17 1.99 (1.04) (0.08)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.01) -- -- -- --
Distributions from
Realized Gains...... (0.17) -- -- (0.09) --
----- -----
Total Dividends and
Distributions (0.18) -- -- (0.09) --
----- -----
Net Asset Value, End
of Period............ $12.27 $11.95 $10.78 $8.79 $9.92
====== ====== ====== ===== =====
Total Return /(b)/ ... 4.19%/(e)/ 10.85% 22.64% (10.62)% (0.80)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $19,856 $17,127 $13,196 $7,439 $2,786
Ratio of Expenses to
Average Net Assets.. 2.20%/(f)/ 2.20% 2.48% 2.70% 2.70%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.23%/(f)/ 2.23%/(g)/ 2.51%/(g)/ 2.71%/(g)/ 2.82%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 0.31%/(f)/ 0.06% 0.06% (0.35)% (0.33)%/(f)/
Portfolio Turnover
Rate................ 24.3%/(f)/ 27.0% 18.5% 10.5% 35.1%/(f)/
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without fees the Manager's voluntary expense limit. Expense
limits for each class were decreased on March 1, 2003 and March 1, 2004.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without commission rebates.
/(h) /Period from December 22, 2000, date shares first offered, through October
31, 2001.
See accompanying notes.
184
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000/(H)/
---- ---- ---- ---- ---- ----
PRINCIPAL PARTNERS MIDCAP GROWTH FUND, INC.
- -------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $5.15 $5.07 $3.61 $4.55 $9.09 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.04) (0.08) (0.07) (0.08) (0.10) (0.04)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.22 0.16 1.53 (0.86) (4.44) (0.87)
---- ---- ---- ----- ----- -----
Total From Investment
Operations 0.18 0.08 1.46 (0.94) (4.54) (0.91)
---- ---- ---- ----- ----- -----
Net Asset Value, End
of Period............ $5.33 $5.15 $5.07 $3.61 $4.55 $9.09
===== ===== ===== ===== ===== =====
Total Return /(b)/ ... 3.50%/(e)/ 1.58% 40.44% (20.66)% (49.94)% (12.68)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $22,840 $22,678 $22,206 $12,745 $11,207 $11,875
Ratio of Expenses to
Average Net Assets.. 1.75%/(f)/ 1.78% 1.95% 1.95% 1.95% 1.79%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.98%/(f)/ 1.91%/(g)/ 2.39%/(g)/ 2.40%/(g)/ 2.67% 2.50%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (1.39)%/(f)/ (1.49)% (1.72)% (1.74)% (1.64)% (1.40)%/(f)/
Portfolio Turnover
Rate................ 120.3%/(f)/ 173.3% 175.6% 234.9% 334.0% 265.5%/(f)/
2005/(D)/ 2004 2003 2002 2001 2000/(H)/
---- ---- ---- ---- ---- ----
PRINCIPAL PARTNERS MIDCAP GROWTH FUND, INC.
- -------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $5.01 $4.97 $3.54 $4.49 $9.04 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.06) (0.11) (0.10) (0.08) (0.08) (0.07)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.22 0.15 1.53 (0.87) (4.47) (0.89)
---- ---- ---- ----- ----- -----
Total From Investment
Operations 0.16 0.04 1.43 (0.95) (4.55) (0.96)
---- ---- ---- ----- ----- -----
Net Asset Value, End
of Period............ $5.17 $5.01 $4.97 $3.54 $4.49 $9.04
===== ===== ===== ===== ===== =====
Total Return /(b)/ ... 3.19%/(e)/ 0.80% 40.40% (21.16)% (50.33)% (13.16)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $9,678 $9,351 $8,528 $4,160 $3,967 $4,093
Ratio of Expenses to
Average Net Assets.. 2.50%/(f)/ 2.52% 2.70% 2.70% 2.70% 2.54%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.72%/(f)/ 2.66%/(g)/ 3.17%/(g)/ 3.32%/(g)/ 3.45% 3.22%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (2.14)%/(f)/ (2.23)% (2.47)% (2.49)% (2.40)% (2.18)%/(f)/
Portfolio Turnover
Rate................ 120.3%/(f)/ 173.3% 175.6% 234.9% 334.0% 265.5%/(f)/
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit began on the first day of the period ended October 31, 2000. The
expense limits for each class were increased on November 1, 2000 and deceased
on March 1, 2004.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without commission rebates.
/(h) /Period from March 1, 2000, date shares first offered, through October 31,
2000.
See accompanying notes.
185
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001/(H)/
---- ---- ---- ---- ----
PRINCIPAL PARTNERS SMALLCAP
- ---------------------------
GROWTH FUND, INC.
- -----------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $5.54 $5.43 $3.99 $6.24 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.05) (0.09) (0.07) (0.08) (0.07)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.08 0.20 1.51 (2.17) (3.69)
---- ---- ---- ----- -----
Total From Investment
Operations 0.03 0.11 1.44 (2.25) (3.76)
---- ---- ---- ----- -----
Net Asset Value, End
of Period............ $5.57 $5.54 $5.43 $3.99 $6.24
===== ===== ===== ===== =====
Total Return /(b)/ ... 0.54%/(e)/ 2.03% 36.09% (36.06)% (37.60)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $13,410 $13,057 $10,108 $4,899 $4,107
Ratio of Expenses to
Average Net Assets.. 1.95%/(f)/ 1.95% 1.95% 1.95% 1.95%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.11%/(f)/ 2.14%/(g)/ 2.88%/(g)/ 2.95%/(g)/ 2.94%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (1.69)%/(f)/ (1.65)% (1.59)% (1.69)% (1.55)%/(f)/
Portfolio Turnover
Rate................ 27.7%/(f)/ 58.1% 72.2% 303.3% 144.5%/(f)/
2005/(D)/ 2004 2003 2002 2001/(H)/
---- ---- ---- ---- ----
PRINCIPAL PARTNERS SMALLCAP
- ---------------------------
GROWTH FUND, INC.
- -----------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $5.38 $5.31 $3.93 $6.20 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.07) (0.13) (0.10) (0.08) (0.11)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.08 0.20 1.48 (2.19) (3.69)
---- ---- ---- ----- -----
Total From Investment
Operations 0.01 0.07 1.38 (2.27) (3.80)
---- ---- ---- ----- -----
Net Asset Value, End
of Period............ $5.39 $5.38 $5.31 $3.93 $6.20
===== ===== ===== ===== =====
Total Return /(b)/ ... 0.19%/(e)/ 1.32% 35.11% (36.61)% (38.00)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $6,691 $6,050 $4,402 $1,579 $1,230
Ratio of Expenses to
Average Net Assets.. 2.70%/(f)/ 2.69% 2.70% 2.70% 2.70%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.83%/(f)/ 2.88%/(g)/ 3.76%/(g)/ 3.98%/(g)/ 3.82%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (2.44)%/(f)/ (2.40)% (2.34)% (2.43)% (2.29)%/(f)/
Portfolio Turnover
Rate................ 27.7%/(f)/ 58.1% 72.2% 303.3% 144.5%/(f)/
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without commission rebates.
/(h) /Period from December 22, 2000, date shares first offered, through October
31, 2001.
See accompanying notes.
186
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL REAL ESTATE SECURITIES FUND, INC.
- -------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $16.48 $13.06 $10.03 $9.45 $9.03 $7.73
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.11 0.24 0.34 0.30 0.34 0.35
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.23 3.66 3.01 0.57 0.42 1.30
---- ---- ---- ---- ---- ----
Total From Investment
Operations 1.34 3.90 3.35 0.87 0.76 1.65
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.12) (0.26) (0.32) (0.29) (0.34) (0.35)
Distributions from
Realized Gains...... (2.11) (0.22) -- -- -- --
----- -----
Total Dividends and
Distributions (2.23) (0.48) (0.32) (0.29) (0.34) (0.35)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $15.59 $16.48 $13.06 $10.03 $9.45 $9.03
====== ====== ====== ====== ===== =====
Total Return /(b)/ ... 8.43%/(e)/ 30.59% 34.00% 9.13% 8.49% 21.86%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $71,351 $62,362 $46,131 $29,198 $12,700 $9,439
Ratio of Expenses to
Average Net Assets.. 1.61%/(f)/ 1.64% 1.82% 1.76% 1.97% 1.88%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... -- 1.64%/(g)/ -- -- -- 2.17%
Ratio of Net
Investment Income to
Average Net Assets.. 1.38%/(f)/ 1.68% 3.05% 2.87% 3.57% 4.28%
Portfolio Turnover
Rate................ 24.9%/(f)/ 79.3% 58.4% 65.4% 69.5% 79.8%
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL REAL ESTATE SECURITIES FUND, INC.
- -------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $16.38 $12.98 $9.98 $9.41 $9.00 $7.71
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.05 0.14 0.26 0.23 0.28 0.30
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.21 3.65 2.98 0.57 0.42 1.29
---- ---- ---- ---- ---- ----
Total From Investment
Operations 1.26 3.79 3.24 0.80 0.70 1.59
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.06) (0.17) (0.24) (0.23) (0.29) (0.30)
Distributions from
Realized Gains...... (2.11) (0.22) -- -- -- --
----- -----
Total Dividends and
Distributions (2.17) (0.39) (0.24) (0.23) (0.29) (0.30)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $15.47 $16.38 $12.98 $9.98 $9.41 $9.00
====== ====== ====== ===== ===== =====
Total Return /(b)/ ... 7.97%/(e)/ 29.79% 32.95% 8.38% 7.76% 21.00%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $21,215 $19,102 $15,232 $8,982 $5,663 $4,488
Ratio of Expenses to
Average Net Assets.. 2.34%/(f)/ 2.34% 2.51% 2.47% 2.58% 2.62%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... -- 2.35%/(g)/ -- -- -- 2.75%
Ratio of Net
Investment Income to
Average Net Assets.. 0.65%/(f)/ 0.99% 2.34% 2.26% 2.97% 3.53%
Portfolio Turnover
Rate................ 24.9%/(f)/ 79.3% 58.4% 65.4% 69.5% 79.8%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit was effective for the year ended October 31, 2000.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without commission rebates.
See accompanying notes.
187
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL SMALLCAP FUND, INC.
- -----------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $9.17 $8.28 $6.23 $7.60 $11.24 $11.34
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.03) (0.07) (0.06) (0.12) (0.11) (0.11)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.47 0.96 2.11 (1.25) (1.91) 1.27
---- ---- ---- ----- ----- ----
Total From Investment
Operations 0.44 0.89 2.05 (1.37) (2.02) 1.16
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- -- (1.62) (1.26)
---- ----- -----
Total Dividends and
Distributions -- -- -- -- (1.62) (1.26)
---- ----- -----
Net Asset Value, End
of Period............ $9.61 $9.17 $8.28 $6.23 $7.60 $11.24
===== ===== ===== ===== ===== ======
Total Return /(b)/ ... 4.80%/(e)/ 10.75% 32.91% (18.03)% (19.37)% 9.89%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $86,090 $82,731 $73,671 $56,334 $53,763 $60,660
Ratio of Expenses to
Average Net Assets.. 1.63%/(f)/ 1.57% 1.98% 1.94% 1.87% 1.75%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... -- 1.57%/(g)/ 1.98%/(g)/ 1.95%/(g)/ -- 1.76%
Ratio of Net
Investment Income to
Average Net Assets.. (0.53)%/(f)/ (0.76)% (0.85)% (0.93)% (0.80)% (0.61)%
Portfolio Turnover
Rate................ 163.0%/(f)/ 188.8% 165.6% 218.2% 154.9% 138.4%
2005/(D)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL SMALLCAP FUND, INC.
- -----------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $8.68 $7.90 $5.99 $7.36 $11.02 $11.21
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.06) (0.13) (0.10) (0.09) (0.06) (0.10)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.45 0.91 2.01 (1.28) (1.98) 1.17
---- ---- ---- ----- ----- ----
Total From Investment
Operations 0.39 0.78 1.91 (1.37) (2.04) 1.07
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- -- (1.62) (1.26)
---- ----- -----
Total Dividends and
Distributions -- -- -- -- (1.62) (1.26)
---- ----- -----
Net Asset Value, End
of Period............ $9.07 $8.68 $7.90 $5.99 $7.36 $11.02
===== ===== ===== ===== ===== ======
Total Return /(b)/ ... 4.49%/(e)/ 9.87% 31.89% (18.61)% (20.05)% 9.14%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $24,921 $24,117 $22,036 $15,624 $17,342 $19,022
Ratio of Expenses to
Average Net Assets.. 2.35%/(f)/ 2.30% 2.70% 2.75% 2.74% 2.41%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... -- 2.31%/(g)/ 2.70%/(g)/ 2.75%/(g)/ -- 2.41%
Ratio of Net
Investment Income to
Average Net Assets.. (1.24)%/(f)/ (1.50)% (1.58)% (1.73)% (1.67)% (1.27)%
Portfolio Turnover
Rate................ 163.0%/(f)/ 188.8% 165.6% 218.2% 154.9% 138.4%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit. The expense
limit was effective for the year ended October 31, 2000.
/(d) /Six months ended April 30, 2005.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Expense ratio without commission rebates.
See accompanying notes.
188
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL TAX-EXEMPT BOND FUND, INC.
- ------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $12.48 $12.31 $12.29 $12.10 $11.65 $11.69
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.23 0.46 0.47 0.48/(f)/ 0.54 0.59
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.08) 0.18 0.05 0.18/(f)/ 0.51 0.06
----- ---- ---- ---- ---- ----
Total From Investment
Operations 0.15 0.64 0.52 0.66 1.05 0.65
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.22) (0.44) (0.45) (0.47) (0.55) (0.58)
Distributions from
Realized Gains...... (0.21) (0.03) (0.05) -- (0.05) (0.11)
---- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.43) (0.47) (0.50) (0.47) (0.60) (0.69)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $12.20 $12.48 $12.31 $12.29 $12.10 $11.65
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 1.28%/(d)/ 5.31% 4.25% 5.64% 9.28% 5.81%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $161,389 $166,930 $178,379 $183,100 $167,016 $163,846
Ratio of Expenses to
Average Net Assets.. 0.79%/(e)/ 0.76% 0.81% 0.77% 0.82% 0.88%
Ratio of Net
Investment Income to
Average Net Assets.. 3.78%/(e)/ 3.72% 3.71% 4.02%/(f)/ 4.59% 5.12%
Portfolio Turnover
Rate................ 50.3%/(e)/ 70.3% 31.2% 60.0% 51.8% 7.6%
2005/(C)/ 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ----
PRINCIPAL TAX-EXEMPT BOND FUND, INC.
- ------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $12.55 $12.36 $12.32 $12.16 $11.71 $11.70
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.20 0.41 0.38 0.38/(g)/ 0.48 0.57
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.07) 0.15 0.07 0.17/(g)/ 0.51 0.07
----- ---- ---- ---- ---- ----
Total From Investment
Operations 0.13 0.56 0.45 0.55 0.99 0.64
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.20) (0.34) (0.36) (0.39) (0.49) (0.52)
Distributions from
Realized Gains...... (0.21) (0.03) (0.05) -- (0.05) (0.11)
---- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.41) (0.37) (0.41) (0.39) (0.54) (0.63)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $12.27 $12.55 $12.36 $12.32 $12.16 $11.71
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 1.06%/(d)/ 4.88% 3.68% 4.67% 8.70% 5.69%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $8,809 $10,742 $13,254 $13,848 $12,122 $10,744
Ratio of Expenses to
Average Net Assets.. 1.21%/(e)/ 1.15% 1.44% 1.60% 1.33% 1.37%
Ratio of Net
Investment Income to
Average Net Assets.. 3.36%/(e)/ 3.32% 3.07% 3.19%/(g)/ 4.07% 4.60%
Portfolio Turnover
Rate................ 50.3%/(e)/ 70.3% 31.2% 60.0% 51.8% 7.6%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Six months ended April 30, 2005.
/(d) /Total return amounts have not been annualized.
/(e) /Computed on an annualized basis.
/(f) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. There was no effect to
the Class A per share net investment income or net realized and unrealized
gain (loss) on investments for the year ended October 31, 2002. The ratio of
net investment income to average net assets increased by .06%. Prior periods
have not been restated to reflect this change in presentation.
/(g) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. There was no effect to
the Class B per share net investment income or net realized and unrealized
gain (loss) on investments for the year ended October 31, 2002. The ratio of
net investment income to average net assets increased by .06%. Prior periods
have not been restated to reflect this change in presentation.
See accompanying notes.
189
FUND DIRECTORS
Under Maryland law, a Board of Directors oversees the Funds. The Directors have
financial or other relevant experience and meet several times during the year to
review contracts, Fund activities and the quality of services provided to the
Funds. Each director also has the same position with Principal Variable
Contracts Fund, Inc. and Principal Investors Fund, Inc. which are also sponsored
by Principal Life Insurance Company. Each director holds office for an
indefinite term. Directors considered to be "interested persons" as defined in
the Investment Company Act of 1940, as amended, as shown below are considered to
be interested because of an affiliation with the Manager and Principal Life
Insurance Company.
THE FOLLOWING DIRECTORS ARE CONSIDERED NOT TO BE "INTERESTED PERSONS" AS DEFINED
IN THE 1940 ACT .
NUMBER OF
PORTFOLIOS IN
FUND OTHER
COMPLEX DIRECTORSHIPS
NAME, POSITION HELD WITH THE FUND, PRINCIPAL OCCUPATION(S) OVERSEEN BY HELD BY
ADDRESS, AND YEAR OF BIRTH DURING PAST 5 YEARS DIRECTOR DIRECTOR*
- ---------------------------------- ----------------------- ------------- -------------
Elizabeth Ballantine
Director since 2004 Principal, EBA
Member, Audit and Associates since 109 The McClatchy
Nominating Committee 1998. Company
1113 Basil Road,
McLean, Virginia
1948
James D. Davis
Director since 1974 Attorney. Vice
Member, Audit and President, Deere and 109 None
Nominating Committee Company, Retired.
4940 Center Court,
Bettendorf, Iowa
1934
109
Richard W. Gilbert Calamos Asset
Director since 1985 Management, Inc.
Member, Audit and President, Gilbert
Nominating Committee Communications, Inc.
5040 Arbor Lane, since 1993.
#302, Northfield,
Illinois.
1940
Mark A. Grimmett Executive Vice 109 None
Director since 2004 President and CFO,
Member, Audit and Merle Norman
Nominating Committee Cosmetics, Inc. since
6310 Deerfield Avenue 2000.
San Gabriel,
California
1960
109 Casey's General
William C. Kimball Stores, Inc.
Director since 1999 Chairman and CEO,
Member, Audit and Medicap Pharmacies,
Nominating Committee Inc. Retired.
3094 104th,
Urbandale, Iowa
1947
109 None
Barbara A. Lukavsky
Director since 1987
Member, Audit and
Nominating Committee President and CEO,
Member, Executive Barbican Enterprises,
Committee Inc. since 1997.
100 Market Street,
#314, Des Moines,
Iowa
1940
* Directorships of any company registered pursuant to Section 12 of the
Securities Exchange Act or subject to the requirements of Section 15(d) of
the Securities Exchange Act or any other mutual fund.
190
THE FOLLOWING DIRECTORS ARE CONSIDERED TO BE "INTERESTED PERSONS" AS DEFINED IN
THE 1940 ACT, AS AMENDED, BECAUSE OF AN AFFILIATION WITH THE MANAGER AND
PRINCIPAL LIFE. .
Director, Principal
Management
Corporation and
Princor Financial
Services Corporation
("Princor") since None
John E. Aschenbrenner 1998. President,
Director since 1998 Insurance and
1949 Financial Services,
Principal Life since
2003. Executive Vice
President, 2000-2003.
Prior thereto, Senior
Vice President.
Director and
President, Princor
Ralph C. Eucher and Principal
Director and Management
President since 1999 Corporation, since None
Member, Executive 1999. Senior Vice
Committee President, Principal
1952 Life, since 2002.
Prior thereto, Vice
President.
Chairman and
Larry D. Zimpleman Director, Princor and None
Director and Chairman Principal Management
of the Board since Corporation since
2001 2002. President,
Member, Executive Retirement and
Committee Investor Services,
1951 Principal Life since
2003. Executive Vice
President, 2001-2003.
Prior thereto, Senior
Vice President.
The Audit and Nominating Committee selects the independent auditors for the
Funds and oversees the activities of the independent auditors as well as the
internal auditors. The committee also receives reports about accounting and
financial matters affecting the Funds. In addition, the committee selects and
nominates all candidates who are not "interested persons" of the Funds for
election to the Board.
The Executive Committee is selected by the Board. It may exercise all the powers
of the Board, with certain exceptions, when the Board is not in session. The
Committee must report its actions to the Board.
Additional information about the Funds is available in the Prospectus and
Statement of Additional Information both dated March 1, 2005. These documents
may be obtained free of charge by writing or telephoning Princor Financial
Services Corporation, P.O. Box 10423, Des Moines, IA 50306. Telephone
1-800-247-4123.
PROXY VOTING POLICIES
A description of the policies and procedures the Funds use to determine how to
vote proxies relating to portfolio securities and the results of the proxy votes
for the most recent period ended June 30 may be obtained free of charge by
telephoning Princor Financial Services Corporation at 1-800-247-4123 or at
www.sec.gov.
SCHEDULES OF INVESTMENTS
The Funds file complete schedules of investments with the Securities and
Exchange Commission as of January 31 and July 31 of each year on Form N-Q. The
Funds' Form N-Q can be reviewed and copied at the Commission's Public Reference
Room in Washington, D.C. or on the Commission's website at www.sec.gov.
Information on the operation of the Public Reference Room may be obtained by
calling the Commission at 1-800-SEC-0330.
ITEM 2 - CODE OF ETHICS
Not applicable to semi-annual reports.
ITEM 3 - AUDIT COMMITTEE FINANCIAL EXPERT
Not applicable to semi-annual reports.
ITEM 4 - PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not applicable to semi-annual reports.
ITEM 5 - AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable.
ITEM 6 - SCHEDULE OF INVESTMENTS
Schedule of Investments is included as part of the Report to Shareholders filed
under Item 1 of this form.
ITEM 7 - DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
Not applicable.
ITEM 8 - PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES
Not applicable.
ITEM 9 - PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS
Not applicable.
ITEM 10 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 11 - CONTROLS AND PROCEDURES
a) The registrant's principal executive officer and principal financial officer
have concluded that the registrant's disclosure controls and procedures (as
defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended)
are effective (such disclosure controls and procedures having been evaluated
within 90 days of the date of this filing).
(b) There have been no changes in the registrant's internal controls over
financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR
270.30a-3(d)) that occurred during the registrant's last fiscal quarter that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEM 12 - EXHIBITS
(a)(1) Code of Ethics - Not applicable to semi-annual reports.
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
attached hereto as Exhibit 99.CERT.
(b) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
attached hereto as Exhibit 99.906CERT.
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.
(Registrant) Principal Equity Income Fund, Inc.
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By /s/ Ralph C. Eucher
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Ralph C. Eucher, President
Date 6/17/2005
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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/ Ralph C. Eucher
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Ralph C. Eucher, President
Date 6/17/2005
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By /s/ Jill R. Brown
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Jill R. Brown, Vice President and Chief Financial Officer
Date 6/17/2005
--------------------