UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-09032
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STI Classic Variable Trust
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(Exact name of registrant as specified in charter)
101 Federal St, Boston, MA 02110
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(Address of principal executive offices) (Zip code)
BISYS Fund Services, 3435 Stelzer Rd., Columbus, OH 43219
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(Name and address of agent for service)
Registrant's telephone number, including area code: 614-470-8000
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Date of fiscal year end: 12/31/05
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Date of reporting period: 06/30/05
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Form N-CSR is to be used by management investment companies to file reports
with the Commission not later than 10 days after the transmission to
stockholders of any report that is required to be transmitted to stockholders
under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1).
The Commission may use the information provided on Form N-CSR in its regulatory,
disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form
N-CSR, and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
Include a copy of the report transmitted to stockholders pursuant to
Rule 30e-1 under the Act (17 CFR 270.30e-1).
SEMI - ANNUAL
FINANCIAL REPORT
STI CLASSIC VARIABLE TRUST
June 30, 2005
[STI CLASSIC VARIABLE TRUST LOGO]
TABLE OF CONTENTS
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STI CLASSIC VARIABLE TRUST June 30, 2005
President and Chief Investment Officer Letter to Shareholders ............. 1
Industry Allocation ....................................................... 3
Schedules of Portfolio Investments ........................................ 5
Statements of Assets and Liabilities ...................................... 26
Statements of Operations .................................................. 27
Statements of Changes in Net Assets ....................................... 28
Financial Highlights ...................................................... 31
Notes to Financial Statements ............................................. 33
Trustees and Officers of the STI Classic Variable Trust ................... 41
Special Meeting of Shareholders ........................................... 43
Additional Information .................................................... 45
PRESIDENT AND CHIEF INVESTMENT OFFICER LETTER TO SHAREHOLDERS
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STI CLASSIC VARIABLE TRUST June 30, 2005
Dear Valued STI Classic Variable Trust Shareholder,
The performance in the financial markets was sluggish in the first half of
2005, as a variety of issues and concerns continued to weigh on investors. One
long-standing source of anxiety has been the strength and sustainability of the
current expansion. More recent troubling events were the dampening effects of
the reacceleration in energy prices and the ninth Federal Reserve rate hike.
Stocks, as measured by the S&P 500 Index, were off a modest 0.8% on a total
return basis (price change plus dividends received) through the first six
months of the year. Bonds, as measured by the Lehman Brothers Aggregate Bond
Index, improved during first half, returning 2.5%. Overall, we remain
optimistic about the economy, the sustainability of the current expansion, and
the equity markets. But we also believe that evolving cross-currents overlaid on
market expectations could be a source of continued volatility. We would like to
take a few minutes to share our perspective on some of the key events and
pressures at work during this time, and highlight some of the essential forces
that we believe may influence the economy and the markets during the remainder
of this year.
Growth in the first half was generally stronger than expected, and inflation
core remained relatively low. However, the monthly economic reports in this
"Goldilocks" environment seemed to alternate between "too hot" and "too cold"
causing noticeable volatility. Key elements of the period included continued
improvement in job growth, improved consumer confidence, strong corporate cash
flow, and a strong housing market. Growth outside the U.S. was more mixed, with
activity more sluggish in the European Union but improving in Japan.
Against this backdrop, the Federal Reserve Board (the "Fed") retained its
positive outlook on the economy as well as its concern about future inflation.
The Fed raised the overnight fed funds rate at every policy meeting during the
first half to 3.38% for a total of nine rate hikes since June 2004. Bond
yields, however, defied the historical pattern of rising as the Fed becomes
more restrictive. Yields fell in the first half of the year, causing the shape
of the yield curve to further flatten. Credit quality spreads remained
relatively low by historical standards, suggesting healthy and accessible credit
markets, but spreads widened slightly. Quality was the main focus for investors,
and Treasuries outperformed.
In the equity markets, the more defensive and energy-related sectors tended to
outperform, led by energy, utilities, and health care. Corporate profit growth
appeared to slow during the quarter on a year over year basis, but remained
above average, and full-year estimates continued to rise. The energy sector
dominated the rest of the market in earnings revisions, benefiting from the
rebound in oil prices. Mid-cap stocks outperformed during the period, while the
growth style and international stocks lagged.
1
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Looking ahead, our outlook for the economy remains positive, as it has all year,
and we see the economic glass as "half-full." Steady job gains should more than
offset a reasonable rise in energy costs, allowing consumer spending to grow
moderately. Capital spending is likely to grow somewhat faster than consumer
spending in the coming quarters helped by continued profit growth and high cash
positions. We look for roughly average growth in 2005, though some soft spots
could emerge. Inflation is likely to trend higher and support the Fed's plan to
raise interest rates gradually in the months ahead. The dollar will likely be
under downward pressure.
In this environment, we continue to recommend a modest overweight position in
stocks within individual asset allocation ranges, emphasizing large-caps, the
growth style, and international equities where appropriate. However, we
recognize that some of the factors that have favored equities (steep yield
curve, low yields, and easy profit comparisons) are changing and not as
favorable. We will continue to be very price sensitive in entry and exit points
and emphasize companies with consistent growth.
In fixed-income portfolios, we anticipate moderately higher yields and a further
flattening of the yield curve, though much of the move has already occurred. In
this environment we will maintain a neutral duration maturity structure and an
emphasis on Treasuries. We reduced the overweighting in TIPS, but will look for
attractive opportunities to increase exposure. We will maintain an underweight
position in corporate bonds and mortgages.
We want to take this opportunity to thank you again for investing in the STI
Classic Variable Trust. We value our relationship with you, and will continue to
strive to provide the highest levels of service, support, and performance to
help you reach your investment goals.
Sincerely,
/s/ Douglas S. Phillip
Douglas S. Phillips, CFA
President and Chief Investment Officer
PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS.
The foregoing information and opinions are for general information only. STI
Classic Variable Trust and Trusco Capital Management do not assume liability for
any loss which may result from the reliance by any person upon such information
or opinions. Such information and opinions are subject to change without notice,
are for general information only and are not intended as an offer or
solicitation with respect to the purchase or sale of any security, or as
offering individual or personalized investment advice.
This material is authorized for distribution only when preceded or accompanied
by a current prospectus. An investor should consider a fund's investment
objectives, risks, and charges and expenses carefully before investing or
sending money. This and other important information about the STI Classic
Variable Trust can be found in the funds' prospectus. To obtain more
information, call 1-800-428-6970, option 1. Please read the prospectus carefully
before investing.
STI Classic Variable Trust Funds are distributed by BISYS Fund Services Limited
Partnership, which is not affiliated with Trusco Capital Management, Inc.
2
INDUSTRY ALLOCATION (As a percentage of net assets)
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STI CLASSIC VARIABLE TRUST June 30, 2005
CAPITAL APPRECIATION FUND
Consumer Discretionary 13.1%
Consumer Staples 3.8%
Energy 3.3%
Financials 17.7%
Health Care 10.3%
Industrials 14.1%
Information Technology 28.8%
Materials 0.8%
Short-Term Investment 8.1%
------
100.0%
GROWTH AND INCOME FUND
Consumer Discretionary 8.5%
Consumer Staples 11.2%
Energy 9.5%
Financials 21.8%
Health Care 10.8%
Industrials 11.7%
Information Technology 14.5%
Materials 3.1%
Telecommunication Services 3.1%
Utilities 3.6%
Short-Term Investment 1.6%
Money Market Funds 0.6%
------
100.0%
INTERNATIONAL EQUITY FUND
Cash Equivalent 0.8%
Consumer Discretionary 9.9%
Consumer Staples 6.0%
Energy 10.2%
Financials 27.5%
Health Care 9.0%
Industrials 11.5%
Information Technology 5.0%
Materials 7.7%
Telecommunication Services 7.3%
Utilities 5.1%
------
100.0%
MID-CAP EQUITY FUND
Consumer Discretionary 15.1%
Consumer Staples 3.0%
Energy 5.7%
Financials 17.2%
Health Care 9.0%
Industrials 9.2%
Information Technology 12.4%
Materials 2.8%
Telecommunication Services 0.9%
Utilities 6.2%
Short-Term Investment 16.7%
Money Market Funds 1.8%
------
100.0%
SMALL CAP VALUE EQUITY FUND
Consumer Discretionary 17.6%
Consumer Staples 3.9%
Energy 4.7%
Financials 17.0%
Health Care 6.0%
Industrials 22.5%
Information Technology 11.9%
Materials 7.4%
Utilities 1.2%
Short-Term Investment 1.6%
Money Market Funds 6.2%
------
100.0%
VALUE INCOME STOCK FUND
Consumer Discretionary 7.6%
Consumer Staples 9.9%
Energy 9.0%
Financials 23.3%
Health Care 7.0%
Industrials 15.7%
Information Technology 4.2%
Materials 8.0%
Telecommunication Services 7.4%
Utilities 3.7%
Short-Term Investment 4.2%
------
100.0%
INVESTMENT GRADE BOND FUND
Asset Backed Securities 4.1%
Corporate Bonds 18.8%
U.S. Government Agencies 10.3%
U.S. Treasury Obligations 39.3%
Short-Term Investment 26.8%
Money Market Funds 0.7%
------
100.0%
The Industry Allocation percentages are as of June 30, 2005 and subject to
change.
3
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4
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except shares)
CAPITAL APPRECIATION FUND
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
COMMON STOCKS (97.6%)
CONSUMER DISCRETIONARY (13.9%)
Harley-Davidson, Inc. (b) 11,200 $ 556
Home Depot, Inc. (The) 11,800 459
J. C. Penney Co., Inc. 11,300 594
Kohl's Corp. * 6,700 375
Lowe's Cos., Inc. 8,000 466
NIKE, Inc., Cl B (b) 13,400 1,160
Omnicom Group, Inc. 13,500 1,078
Time Warner, Inc. * 60,200 1,006
Walt Disney Co. (The) 43,900 1,105
-------
6,799
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CONSUMER STAPLES (4.0%)
Wal-Mart Stores, Inc. 19,300 930
Walgreen Co. 22,800 1,049
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1,979
-------
ENERGY (3.5%)
Anadarko Petroleum Corp. 5,300 435
Exxon Mobil Corp. 22,600 1,299
-------
1,734
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FINANCIALS (18.8%)
American Express Co. 28,600 1,522
Chubb Corp. (The) 15,000 1,284
Comerica, Inc. 10,200 590
Freddie Mac 9,000 587
Goldman Sachs Group, Inc.
(The) 9,400 959
JPMorgan Chase & Co. 27,600 975
MGIC Investment Corp. 16,000 1,044
SLM Corp. (b) 17,400 884
Washington Mutual, Inc. 20,500 834
Wells Fargo & Co. 8,500 523
-------
9,202
-------
HEALTH CARE (10.9%)
Baxter International, Inc. 29,700 1,102
Becton, Dickinson & Co. 16,200 850
Biomet, Inc. 13,200 457
</Table>
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
HEALTH CARE--CONTINUED
Boston Scientific Corp. * 26,400 $ 713
Health Management Associates,
Inc., Cl A 20,300 531
Johnson & Johnson 8,700 566
Schering-Plough Corp. 21,000 400
Stryker Corp. 14,700 699
-------
5,318
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INDUSTRIALS (15.0%)
Boeing Co. (The) 8,000 528
Danaher Corp. 15,000 785
Emerson Electric Co. 12,200 764
General Electric Co. 43,800 1,518
Honeywell International,
Inc. 28,100 1,029
Northrop Grumman Corp. 18,300 1,011
Raytheon Co. 27,600 1,080
Southwest Airlines Co. 45,800 638
-------
7,353
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INFORMATION TECHNOLOGY (30.6%)
Affiliated Computer Services,
Inc., Cl A * (b) 14,000 715
Amdocs Ltd. * 23,500 621
Automatic Data Processing,
Inc. 20,900 877
CDW Corp. (b) 7,400 422
CheckFree Corp. * (b) 29,700 1,012
Cisco Systems, Inc. * 30,000 573
Computer Associates
International, Inc. 28,200 775
EMC Corp. * 65,600 899
First Data Corp. 13,000 522
Hewlett-Packard Co. 20,200 475
LSI Logic Corp. * 34,500 293
Maxim Integrated Products,
Inc. 15,500 592
Microsoft Corp. 58,000 1,442
NCR Corp. * 32,500 1,141
Nokia Corp. ADR 64,700 1,077
</Table>
5
(Unaudited)
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
INFORMATION TECHNOLOGY--CONTINUED
Oracle Corp. * 73,000 $ 964
Scientific-Atlanta, Inc. 18,900 629
Texas Instruments, Inc. 35,000 982
VeriSign, Inc. * 31,400 903
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14,914
-------
MATERIALS (0.9%)
Rohm & Haas Co. 9,000 417
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Total Common Stocks
(Cost $44,007) 47,716
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SHORT-TERM INVESTMENT (8.6%)
CSFB Enhanced Liquidity
Portfolio (c) 4,212,654 4,213
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Total Short-Term Investment
(Cost $4,213) 4,213
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Total Investments
(Cost $48,220) (a) -- 106.2% 51,929
Liabilities in excess of other
assets -- (6.2)% (3,029)
-------
Net Assets -- 100.0% $48,900
=======
</Table>
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* Non-income producing security.
(a) Cost for federal income tax purposes is $48,236
(amount in thousands). Unrealized appreciation/ (depreciation) on a tax
basis is as follows (amounts in thousands):
<Table>
Unrealized Appreciation............... $ 5,047
Unrealized Depreciation............... (1,354)
-------
Unrealized Appreciation
(Depreciation)...................... $ 3,693
=======
</Table>
(b) This security or a partial position of the security was
on loan at June 30, 2005. The total value of securities on loan at June
30, 2005 in thousands was $4,093.
(c) This security was purchased with cash collateral
held from securities lending.
ADR -- American Depository Receipt
Cl -- Class
See notes to financial statements.
6
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except shares)
GROWTH AND INCOME FUND
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
COMMON STOCKS (99.3%)
CONSUMER DISCRETIONARY (8.6%)
Advance Auto Parts, Inc. * 2,700 $ 174
Gannett Co., Inc. 2,000 142
Kohl's Corp. * 2,500 140
Lowe's Cos., Inc. 2,000 116
Target Corp. 2,200 120
Viacom, Inc., Cl B 7,000 224
Walt Disney Co. (The) 4,000 101
-------
1,017
-------
CONSUMER STAPLES (11.4%)
Archer Daniels Midland Co. 9,000 192
Clorox Co. (The) 1,800 100
Diageo PLC ADR 3,500 208
Kimberly-Clark Corp. 2,000 125
PepsiCo, Inc. 2,000 108
Sara Lee Corp. 7,000 139
SYSCO Corp. 1,000 36
Unilever PLC ADR 4,000 155
Wal-Mart Stores, Inc. 3,000 145
Wm. Wrigley Jr. Co. 2,000 138
-------
1,346
-------
ENERGY (9.7%)
Anadarko Petroleum Corp. 1,200 99
Baker Hughes, Inc. 3,700 189
Burlington Resources, Inc. 2,000 110
ChevronTexaco Corp. 2,000 112
ConocoPhillips 2,400 138
Exxon Mobil Corp. 3,600 207
Kerr-McGee Corp. 929 71
Royal Dutch Petroleum Co. ADR 3,300 214
-------
1,140
-------
FINANCIALS (22.1%)
American International Group,
Inc. 2,100 122
Bank of America Corp. 4,000 182
Berkshire Hathaway, Inc., Cl B
* 75 209
Cincinnati Financial Corp. 4,200 166
CIT Group, Inc. 3,500 150
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
FINANCIALS--CONTINUED
Citigroup, Inc. 5,000 $ 232
Fannie Mae 1,500 88
Fifth Third Bancorp 3,000 124
Genworth Financial, Inc., Cl A 6,000 181
Goldman Sachs Group, Inc. (The) 1,000 102
MGIC Investment Corp. 1,500 98
Morgan Stanley 3,000 157
New York Community Bancorp,
Inc. (b) 10,000 181
Principal Financial Group,
Inc. 5,000 210
State Street Corp. 3,000 145
U.S. Bancorp 5,000 146
Wells Fargo & Co. 1,825 112
-------
2,605
-------
HEALTH CARE (11.0%)
Abbott Laboratories 4,000 196
Amgen, Inc. * 2,000 121
Bristol-Myers Squibb Co. 9,000 225
Eli Lilly & Co. 2,500 139
Express Scripts, Inc. * 1,600 80
Johnson & Johnson 1,500 98
Medtronic, Inc. 1,000 52
Pfizer, Inc. 10,000 276
WellPoint, Inc. * 1,500 104
-------
1,291
-------
INDUSTRIALS (11.9%)
Cendant Corp. 7,000 157
Cooper Industries Ltd., Cl A 2,000 128
Emerson Electric Co. 1,800 113
General Electric Co. 4,600 159
Goodrich Corp. 4,000 163
Honeywell International, Inc. 4,000 147
Illinois Tool Works, Inc. 1,000 80
Norfolk Southern Corp. 5,000 155
Rockwell Automation, Inc. 3,500 169
Textron, Inc. 1,800 137
-------
1,408
-------
</Table>
7
(Unaudited)
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
INFORMATION TECHNOLOGY (14.7%)
Accenture Ltd., Cl A * 7,000 $ 159
Agilent Technologies, Inc. * 7,000 161
Applied Materials, Inc. 12,000 194
Cisco Systems, Inc. * 9,000 172
First Data Corp. 4,000 161
Intel Corp. 6,000 156
International Business Machines
Corp. 1,800 134
Microsoft Corp. 9,500 236
Nokia Corp. ADR 13,000 216
Texas Instruments, Inc. 5,000 140
-------
1,729
-------
MATERIALS (3.1%)
E.I. du Pont de Nemours & Co. 2,500 108
Praxair, Inc. 3,000 140
Sigma-Aldrich Corp. 2,200 123
-------
371
-------
TELECOMMUNICATION SERVICES (3.1%)
ALLTEL Corp. 1,000 62
Verizon Communications, Inc. 4,000 138
Vodafone Group PLC ADR 7,000 171
-------
371
-------
UTILITIES (3.7%)
American Electric Power Co.,
Inc. 3,300 122
Edison International 3,500 141
Exelon Corp. 2,300 118
SCANA Corp. 1,400 60
-------
441
-------
Total Common Stocks
(Cost $10,134) 11,719
-------
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
SHORT-TERM INVESTMENT (1.6%)
CSFB Enhanced Liquidity
Portfolio (c) 183,150 $ 183
-------
Total Short-Term Investment
(Cost $183) 183
-------
MONEY MARKET FUNDS (0.6%)
Federated Prime Value
Obligations Fund, Cl I 66,096 66
-------
Total Money Market Funds
(Cost $66) 66
-------
Total Investments
(Cost $10,383) (a) -- 101.5% 11,968
Liabilities in excess of other
assets -- (1.5)% (180)
-------
Net Assets -- 100.0% $11,788
=======
</Table>
- ---------------
* Non-income producing security.
(a) Cost for federal income tax purposes is $10,401
(amount in thousands). Unrealized appreciation/(depreciation) on a tax
basis is as follows (amounts in thousands):
<Table>
Unrealized Appreciation................ $1,811
Unrealized Depreciation................ (244)
------
Unrealized Appreciation
(Depreciation)....................... $1,567
======
</Table>
(b) This security or a partial position of the security was
on loan at June 30, 2005. The total value of securities on loan at June
30, 2005 in thousands was $179.
(c) This security was purchased with cash collateral
held from securities lending.
ADR -- American Depository Receipt
Cl -- Class
See notes to financial statements.
8
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except shares)
INTERNATIONAL EQUITY FUND
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
FOREIGN COMMON STOCKS (98.8%)
AUSTRALIA (4.0%)
Australia & New Zealand Banking
Group Ltd. 2,248 $ 38
BlueScope Steel Ltd. 4,182 26
Just Group Ltd. 5,811 9
Promina Group Ltd. 5,600 20
Qantas Airways Ltd. 11,765 30
Rio Tinto Group Ltd. 771 26
St. George Bank Ltd. 1,641 33
Westpac Banking Corp. 2,277 34
------
216
------
BELGIUM (0.5%)
Delhaize Group 117 7
Fortis SA 768 21
------
28
------
DENMARK (1.2%)
Danske Bank A/S 1,092 33
TDC A/S 800 34
------
67
------
FINLAND (2.0%)
Fortum Corp. 1,600 26
Neste Oil Oyj * 400 10
Nokia Corp. 3,675 61
Tietoenator Oyj 280 9
------
106
------
FRANCE (9.7%)
Atos Origin SA * 100 6
AXA 2,013 50
BNP Paribas 818 56
Bouygues SA 382 16
Compagnie de Saint-Gobain 341 19
France Telecom SA 820 24
Lafarge SA 24 2
Pernod Ricard 132 21
PSA Peugeot Citroen SA 164 10
Sanofi-Aventis 508 42
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
FRANCE--CONTINUED
Schneider Electric SA * 349 $ 26
Societe Generale 449 46
SUEZ SA 1,268 34
TOTAL SA 364 84
VINCI SA * 504 42
Vivendi Universal SA * 1,393 44
------
522
------
GERMANY (7.5%)
Adidas-Salomon AG 194 32
Allianz AG 300 34
BASF AG 714 47
Bayer AG 302 10
Continental AG 346 25
DaimlerChrysler AG 156 6
Deutsche Bank AG 355 28
Deutsche Post AG 1,000 23
Deutsche Telekom AG * 1,839 34
E.ON AG 611 55
Lanxess AG * 31 1
MAN AG 88 4
METRO AG 354 18
PUMA Rudolf Dassler Sport AG 50 12
SAP AG 141 24
Schering AG 555 34
Siemens AG 259 19
------
406
------
HONG KONG (2.4%)
Bank of East Asia Ltd. 7,624 22
Cheung Kong (Holdings) Ltd. 3,000 29
CNOOC Ltd. 32,000 19
Esprit Holdings Ltd. 1,456 11
Hutchison Whampoa Ltd. 3,447 31
Orient Overseas (International)
Ltd. 4,400 19
------
131
------
</Table>
9
(Unaudited)
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
IRELAND (0.6%)
CRH PLC 1,127 $ 30
------
ITALY (2.4%)
Banca Intesa SpA 7,851 36
Eni SpA 2,278 58
Mediaset SpA 1,684 20
UniCredito Italiano SpA 2,675 14
------
128
------
JAPAN (22.9%)
Aiful Corp. 300 22
Asahi Breweries Ltd. 1,600 19
Bridgestone Corp. 1,000 19
Brothers Industries Ltd. 2,000 18
Canon, Inc. 700 37
Citizen Watch Co. Ltd. 800 7
Dai Nippon Printing Co. Ltd. 1,000 16
Daiichi Pharmaceutical Co. Ltd. 1,100 24
Daiwa Securities Group, Inc. 2,000 12
East Japan Railway Co. 3 15
Electric Power Development Co.
Ltd. 600 17
Hachijuni Bank Ltd. (The) 2,000 13
Hitachi Chemical Co. Ltd. 800 15
Honda Motor Co. Ltd. 502 25
Ibiden Co. Ltd. 600 16
ITOCHU Corp. 3,000 15
Japan Tobacco, Inc. 2 27
JFE Holdings, Inc. 500 12
Komatsu Ltd. 4,000 31
Kubota Corp. 4,000 22
Kuraray Co. Ltd. 3,000 28
Marubeni Corp. 4,000 14
Matsushita Electric Industrial
Co. Ltd. 1,000 15
Matsushita Electric Works Ltd. 2,000 17
Mazda Motor Corp. (c) 9,000 34
Mitsubishi Chemical Corp. 5,000 15
Mitsubishi Corp. 2,300 31
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
JAPAN--CONTINUED
Mitsubishi Electric Corp. 4,000 $ 21
Mitsubishi Estate Co. Ltd. 1,000 11
Mitsubishi Tokyo Financial
Group, Inc. 3 25
Mitsui Fudosan Co. Ltd. 2,000 22
Mitsui O.S.K. Lines Ltd. 2,000 12
Mitsui Trust Holdings, Inc. 2,000 20
Mizuho Financial Group, Inc. 7 31
Nippon Mining Holdings, Inc. 2,000 11
Nippon Oil Corp. 1,000 7
Nippon Steel Corp. 5,000 12
Nippon Telegraph & Telephone
Corp. 6 26
Nippon Yusen KK 2,000 11
Nomura Research Institute Ltd. 100 10
NTT DoCoMo, Inc. 12 18
OMRON Corp. 800 18
ORIX Corp. 200 30
Resona Holdings, Inc. * 6,000 11
Ricoh Co. Ltd. 1,000 16
Sankyo Co. Ltd. 500 23
Sankyo Co. Ltd. (Gunma) 1,400 27
Sega Sammy Holdings, Inc. 300 18
Sompo Japan Insurance, Inc. 3,000 30
Sony Corp. 500 17
Sumitomo Corp. 2,000 16
Sumitomo Metal Industries Ltd. 8,000 14
Takeda Pharmaceutical Co. Ltd. 900 45
Tohoku Electric Power Co., Inc. 500 11
Tokyo Electric Power Co., Inc.
(The) 1,500 36
Tokyo Gas Co. Ltd. 2,000 7
Toray Industries, Inc. 4,000 19
Toyo Suisan Kaisha Ltd. 1,000 16
Toyota Motor Corp. 1,313 46
West Japan Railway Co. 7 24
</Table>
10
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except
shares)
INTERNATIONAL EQUITY FUND -- CONTINUED
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
JAPAN--CONTINUED
Yamada Denki Co. Ltd. 400 $ 23
Yamaha Motor Co. Ltd. 900 16
------
1,236
------
NETHERLANDS (4.3%)
ABN AMRO Holding NV 1,782 44
Akzo Nobel NV 687 27
ING Groep NV 1,708 49
Royal Dutch Petroleum Co. 544 35
Royal KPN NV 3,978 33
Royal Philips Electronics NV 1,718 43
------
231
------
NEW ZEALAND (0.6%)
Fletcher Building Ltd. 7,109 34
------
NORWAY (1.6%)
Orkla ASA 1,100 41
Statoil ASA 1,300 26
Telenor ASA 2,500 20
------
87
------
SINGAPORE (0.7%)
Singapore Petroleum Co. Ltd. 5,000 15
United Overseas Bank Ltd. * 3,000 25
United Overseas Land Ltd. * (b) 300 0
------
40
------
SPAIN (3.7%)
Altadis SA 366 15
Banco Santander Central Hispano
SA 3,994 46
Endesa SA 392 9
Gestevision Telecinco SA 112 3
Repsol YPF SA 1,905 48
Sociedad General de Aguas de
Barcelona SA, Cl A 656 14
Telefonica SA 3,061 51
Union Fenosa SA 374 11
------
197
------
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
SWEDEN (3.0%)
Autoliv, Inc. 291 $ 13
Nordea Bank AB 3,900 35
Sandvik AB 533 20
Svenska Handelsbanken AB, Cl A 1,200 24
Telefonaktiebolaget LM Ericsson 15,800 51
Volvo AB, Cl B 500 20
------
163
------
SWITZERLAND (6.1%)
Credit Suisse Group 1,220 48
Nestle SA 189 48
Novartis AG 1,855 88
Roche Holding Ltd. 385 49
UBS AG 683 53
Zurich Financial Services 248 43
------
329
------
UNITED KINGDOM (25.6%)
"Shell" Transport & Trading Co.
PLC (The) 8,083 78
Alliance UniChem PLC 2,102 32
Anglo Irish Bank Corp. PLC 1,960 24
AstraZeneca PLC 1,816 75
Aviva PLC 3,806 42
AWG PLC 1,060 18
Balfour Beatty PLC 4,228 25
BHP Billiton PLC 4,278 55
BP PLC 14,412 151
BPB PLC 3,265 31
Bradford & Bingley PLC 6,166 36
British Airways PLC * 6,800 32
British American Tobacco PLC 2,515 48
BT Group PLC 8,928 37
Burberry Group PLC 1,616 12
Corus Group PLC * 15,704 12
CRH PLC (b) 10 0
First Choice Holidays PLC 4,000 14
George Wimpey PLC 3,591 28
GlaxoSmithKline PLC 3,028 73
</Table>
11
(Unaudited)
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
UNITED KINGDOM--CONTINUED
HBOS PLC 4,823 $ 74
Hilton Group PLC 3,463 18
HSBC Holdings PLC 3,178 51
Lloyds TSB Group PLC 5,657 48
O2 PLC * 3,946 10
Old Mutual PLC 6,400 14
Pilkington PLC 6,107 13
Royal Bank of Scotland Group PLC
(The) 3,523 106
SABMiller PLC 1,243 19
Scottish Power PLC 4,514 40
Tesco PLC 7,930 45
Trinity Mirror PLC 1,400 15
Vodafone Group PLC 40,640 99
------
1,375
------
Total Foreign Common Stocks
(Cost $4,168) 5,326
------
RIGHTS (0.6%)
FRANCE (0.6%)
Lafarge Prime De Fidelite * 343 31
------
Total Rights
(Cost $28) 31
------
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
SHORT-TERM INVESTMENTS (0.8%)
Brown Brothers Harriman & Co.,
Cayman Islands Cash Sweep 12,891 $ 13
CSFB Enhanced Liquidity
Portfolio (d) 30,960 31
------
Total Short-Term Investments
(Cost $44) 44
------
Total Investments
(Cost $4,240) (a) -- 100.2% 5,401
Liabilities in excess of other
assets -- (0.2)% (10)
------
Net Assets -- 100.0% $5,391
======
</Table>
- ---------------
* Non-income producing security.
(a) Cost for federal income tax purposes is $4,379
(amount in thousands). Unrealized appreciation/ (depreciation) on a tax
basis is as follows (amounts in thousands):
<Table>
Unrealized Appreciation................ $1,095
Unrealized Depreciation................ (73)
------
Unrealized Appreciation
(Depreciation)....................... $1,022
======
</Table>
(b) Market value is less than one thousand dollars.
(c) This security or a partial position of the security was
on loan at June 30, 2005. The total value of securities on loan at June
30, 2005 in thousands was $29.
(d) This security was purchased with cash collateral
held from securities lending.
Cl -- Class
See notes to financial statements.
12
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except shares)
INTERNATIONAL EQUITY FUND -- CONCLUDED
The investment concentrations for the International Equity Fund as a percentage
of net assets, by industry, as of June 30, 2005, were as follows (unaudited):
<Table>
Consumer Discretionary 9.9%
Consumer Staples 6.0
Energy 10.2
Financials 27.7
Health Care 9.0
Industrials 11.5
Information Technology 5.0
Materials 7.7
Short-Term Investments 0.8
Telecommunication Services 7.3
Utilities 5.1
</Table>
13
(Unaudited)
MID-CAP EQUITY FUND
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
COMMON STOCKS (97.0%)
CONSUMER DISCRETIONARY (17.9%)
Abercrombie & Fitch Co., Cl A 1,816 $ 125
Aeropostale, Inc. * (b) 1,823 61
American Eagle Outfitters,
Inc. 4,120 126
Autoliv, Inc. 1,300 57
Bed Bath & Beyond, Inc. * 2,733 114
Black & Decker Corp. (The) 1,514 136
Brunswick Corp. (b) 1,393 60
Centex Corp. (b) 1,365 96
Choice Hotels International,
Inc. 3,402 224
Coach, Inc. * 1,785 60
Dollar General Corp. 4,136 84
Guitar Center, Inc. * 884 52
Hilton Hotels Corp. 3,304 79
J. C. Penney Co., Inc. 1,712 90
Lennar Corp., Cl A 2,980 189
M.D.C. Holdings, Inc. (b) 2,433 200
Marvel Enterprises, Inc. * (b) 1,604 32
McGraw-Hill Cos., Inc. (The) 4,777 211
Nordstrom, Inc. 1,522 103
Pixar Animation Studios * 918 46
Ryland Group, Inc. (The) 1,057 80
Scholastic Corp. * 3,651 141
Sears Holdings Corp. * 687 103
Sherwin-Williams Co. (The) 2,051 97
Urban Outfitters, Inc. * 1,247 71
YUM! Brands, Inc. 3,049 159
-------
2,796
-------
CONSUMER STAPLES (3.6%)
7-Eleven, Inc. * 3,094 94
Archer Daniels Midland Co. 3,676 79
Pilgrim's Pride Corp. (b) 2,474 84
Reynolds American, Inc. (b) 2,591 204
Smithfield Foods, Inc. * 3,682 100
-------
561
-------
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
ENERGY (6.8%)
Amerada Hess Corp. (b) 1,629 $ 173
Cooper Cameron Corp. * 1,254 78
Devon Energy Corp. 2,878 146
FMC Technologies, Inc. * 2,408 77
Marathon Oil Corp. 2,711 145
Newfield Exploration Co. * 3,029 121
Pride International, Inc. * 3,499 90
Tidewater, Inc. 2,152 82
Valero Energy Corp. (b) 1,869 147
-------
1,059
-------
FINANCIALS (20.4%)
American Capital Strategies
Ltd. (b) 2,104 76
Annaly Mortgage Management,
Inc. (b) 7,320 131
Arch Capital Group Ltd. * 864 39
Bear, Stearns & Co., Inc. 586 61
Brandywine Realty Trust 2,657 81
CBL & Associates Properties,
Inc. 2,400 103
CIT Group, Inc. 2,920 125
Comerica, Inc. 2,537 147
E*TRADE Financial Corp. * 8,325 116
General Growth Properties, Inc.
(b) 4,434 183
IndyMac Bancorp, Inc. 1,692 69
KeyCorp 3,216 107
Legg Mason, Inc. 832 87
Lexington Corp. Properties
Trust (b) 5,392 131
Lincoln National Corp. 4,776 225
MBIA, Inc. 1,949 116
MGIC Investment Corp. 1,781 116
National City Corp. 2,561 87
North Fork Bancorporation,
Inc. 5,423 152
PartnerRe Ltd. 2,665 172
PMI Group, Inc. (The) 1,841 72
</Table>
14
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except shares)
MID-CAP EQUITY FUND -- CONCLUDED
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
FINANCIALS--CONTINUED
Radian Group, Inc. 2,044 $ 97
Raymond James Financial, Inc. 2,737 77
Simon Property Group, Inc. 845 61
SL Green Realty Corp. 2,481 160
Sovereign BanCorp, Inc. 3,244 72
St. Paul Travelers Cos., Inc.
(The) 3,996 158
Student Loan Corp. (The) 784 172
-------
3,193
-------
HEALTH CARE (10.7%)
Allergan, Inc. 739 63
Becton, Dickinson & Co. 1,240 65
CIGNA Corp. 1,693 181
Coventry Health Care, Inc. *
(b) 2,969 211
Edwards Lifesciences Corp. *
(b) 1,429 61
Genzyme Corp. * 1,898 114
Health Management Associates,
Inc., Cl A 4,206 110
Hospira, Inc. * 2,153 84
Humana, Inc. * 5,907 236
ImClone Systems, Inc. * 1,399 43
Laboratory Corp. of America
Holdings * (b) 2,830 141
Medco Health Solutions, Inc. * 2,815 150
Protein Design Labs, Inc. * 3,066 62
Sepracor, Inc. * 991 59
Thermo Electron Corp. * 3,424 92
-------
1,672
-------
INDUSTRIALS (11.0%)
Danaher Corp. 1,741 91
Deluxe Corp. (b) 3,043 124
Eaton Corp. 3,127 188
H & R Block, Inc. (b) 3,096 181
Hughes Supply, Inc. (b) 3,861 108
Old Dominion Freight Line, Inc.
* 1,444 39
PACCAR, Inc. (b) 2,196 149
Parker Hannifin Corp. 1,538 95
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
INDUSTRIALS--CONTINUED
Pitney Bowes, Inc. 1,435 $ 62
R.R. Donnelley & Sons Co. 3,211 111
Rockwell Collins, Inc. 1,940 92
Ryder System, Inc. 3,744 137
Southwest Airlines Co. 10,825 151
Textron, Inc. 1,924 146
Timken Co. (The) 1,949 45
-------
1,719
-------
INFORMATION TECHNOLOGY (14.8%)
Adobe Systems, Inc. 3,746 107
Alliance Data Systems Corp. * 1,208 49
Amphenol Corp., Cl A 1,858 75
Apple Computer, Inc. * 3,679 135
Autodesk, Inc. 3,698 127
Check Point Software
Technologies Ltd. * 2,836 56
Citrix Systems, Inc. * 3,500 76
Corning, Inc. * (b) 7,554 126
Global Payments, Inc. (b) 1,412 96
Juniper Networks, Inc. * 4,507 113
KLA-Tencor Corp. (b) 1,355 59
Lam Research Corp. * 1,156 33
Linear Technology Corp. 1,656 61
McAfee, Inc. * (b) 3,967 104
MEMC Electronic Materials, Inc.
* 7,259 114
National Semiconductor Corp. 7,601 167
NCR Corp. * 3,146 110
Novellus Systems, Inc. * 4,271 106
QLogic Corp. * (b) 1,773 55
Scientific-Atlanta, Inc. 4,377 146
Storage Technology Corp. * 2,062 75
Symantec Corp. * 1,926 42
VeriSign, Inc. * 3,290 95
VERITAS Software Corp. * 2,259 55
Xerox Corp. * 9,851 136
-------
2,318
-------
</Table>
15
(Unaudited)
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
MATERIALS (3.3%)
Ball Corp. 2,392 $ 86
Lubrizol Corp. (The) 3,390 142
Lyondell Chemical Co. 5,100 135
Phelps Dodge Corp. 832 77
United States Steel Corp. (b) 2,110 73
-------
513
-------
TELECOMMUNICATION SERVICES (1.1%)
Citizens Communications Co. 8,316 112
Western Wireless Corp., Cl A * 1,300 55
-------
167
-------
UTILITIES (7.4%)
AES Corp. (The) * 5,894 97
Allegheny Energy, Inc. * (b) 4,551 115
Equitable Resources, Inc. 737 50
National Fuel Gas Co. 2,637 76
Northeast Utilities 9,354 194
PG&E Corp. 3,037 114
Sempra Energy 2,898 120
TXU Corp. 1,575 131
UGI Corp. 5,811 162
Xcel Energy, Inc. (b) 5,068 99
-------
1,158
-------
Total Common Stocks
(Cost $12,651) 15,156
-------
SHORT-TERM INVESTMENT (19.8%)
CSFB Enhanced Liquidity
Portfolio (c) 3,087,909 3,088
-------
Total Short-Term Investment
(Cost $3,088) 3,088
-------
</Table>
<Table>
<Caption>
- -------------------------------------------------------
Shares Value
- -------------------------------------------------------
MONEY MARKET FUNDS (2.2%)
Federated Prime Value
Obligations Fund, Cl I 349,084 $ 349
Total Money Market Funds
(Cost $349) 349
-------
Total Investments
(Cost $16,088) (a) -- 119.0% 18,593
Liabilities in excess of other
assets -- (19.0)% (2,971)
-------
Net Assets -- 100.0% $15,622
=======
</Table>
- ---------------
* Non-income producing security.
(a) Cost for federal income tax purposes is $16,095
(amount in thousands). Unrealized appreciation/ (depreciation) on a tax
basis is as follows (amounts in thousands):
<Table>
Unrealized Appreciation................ $2,760
Unrealized Depreciation................ (262)
------
Unrealized Appreciation (Depreciation) $2,498
======
</Table>
(b) This security or a partial position of the security was
on loan at June 30, 2005. The total value of securities on loan at June
30, 2005 in thousands was $2,984.
(c) This security was purchased with cash collateral
held from securities lending.
Cl -- Class
See notes to financial statements.
16
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except shares)
SMALL CAP VALUE EQUITY FUND
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
COMMON STOCKS (93.6%)
CONSUMER DISCRETIONARY (17.8%)
ADESA, Inc. 9,246 $ 201
ArvinMeritor, Inc. 13,800 246
Bassett Furniture Industries,
Inc. 6,400 121
Benetton Group SpA ADR 7,500 138
Books-A-Million, Inc. 9,200 92
BorgWarner Transmission
Systems, Inc. 7,300 392
Brown Shoe Co., Inc. 5,100 200
CBRL Group, Inc. 8,300 323
Intrawest Corp. 16,800 404
K-Swiss, Inc., Cl A 2,195 71
Lithia Motors, Inc. (b) 15,800 455
Makita Corp. ADR 16,052 313
Movado Group, Inc. 19,700 372
Natuzzi SpA ADR 8,400 68
Nautilus Group, Inc. (The) 9,200 262
Pep Boys-Manny, Moe & Jack
(The) 9,400 127
Snap-on, Inc. 5,700 196
Stanley Furniture Co., Inc. 1,600 39
Sturm, Ruger & Co., Inc. 5,500 46
United Auto Group, Inc. 12,400 370
Winnebago Industries, Inc.
(b) 7,900 259
-------
4,695
-------
CONSUMER STAPLES (4.0%)
Church & Dwight Co., Inc. 12,650 458
Corn Products International,
Inc. 11,300 268
J.M. Smucker Co. (The) 6,875 323
-------
1,049
-------
ENERGY (4.8%)
Arch Coal, Inc. 4,700 256
CHC Helicopter Corp. 25,300 493
</Table>
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
ENERGY--CONTINUED
Peabody Energy Corp. 4,800 $ 250
Tidewater, Inc. 6,900 263
-------
1,262
-------
FINANCIALS (17.3%)
American Financial Group,
Inc. 6,600 221
BankAtlantic Bancorp, Inc. 14,700 279
Banner Corp. 3,900 109
City National Corp. 3,400 244
Cohen & Steers, Inc. 15,500 319
Colonial BancGroup, Inc.
(The) 12,700 280
Federal Agricultural Mortgage
Corp., Cl C 1,174 26
Glacier Bancorp, Inc. 7,922 207
HCC Insurance Holdings, Inc. 10,200 386
Horizon Financial Corp. 7,256 161
Hub International Ltd. 20,800 406
International Bancshares
Corp. 4,500 127
Jefferies Group, Inc. 5,600 212
National Interstate Corp. * 4,105 82
PXRE Group Ltd. 5,300 134
Scottish Re Group Ltd. (b) 5,400 131
Seacoast Banking Corp. of
Florida 6,710 132
South Financial Group, Inc.
(The) 9,400 267
StanCorp Financial Group,
Inc. 5,800 445
Washington Federal, Inc. 8,665 204
West Coast Bancorp 7,076 173
-------
4,545
-------
HEALTH CARE (6.1%)
Cooper Cos., Inc. (The) 10,700 652
Invacare Corp. 5,100 226
Mentor Corp. 11,000 456
PerkinElmer, Inc. 3,500 66
Perrigo Co. 14,300 199
-------
1,599
-------
</Table>
17
(Unaudited)
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
INDUSTRIALS (22.8%)
ABM Industries, Inc. 10,300 $ 201
American Woodmark Corp. 3,869 116
Apogee Enterprises, Inc. 12,600 194
Baldor Electric Co. 9,900 241
Briggs & Stratton Corp. 9,600 332
Brink's Co. (The) 15,000 540
CP Ships Ltd. 16,700 261
Cummins, Inc. (b) 4,500 336
ElkCorp 5,897 168
Embraer-Empresa Brasileira de
Aeronautica SA ADR 7,613 252
Engineered Support Systems,
Inc. 7,050 253
Freightcar America, Inc. * 5,200 103
Graco, Inc. 13,000 442
Granite Construction, Inc. 10,100 284
Harsco Corp. 2,400 131
Lan Airlines SA ADR 7,500 262
Lennox International, Inc. 12,714 269
LSI Industries, Inc. 19,662 274
Oshkosh Truck Corp. 3,300 258
Quixote Corp. 15,100 296
Ryder System, Inc. 1,900 70
Tecumseh Products Co., Cl A 2,500 69
Valmont Industries, Inc. 11,000 284
Wabtec Corp. 18,000 387
-------
6,023
-------
INFORMATION TECHNOLOGY (12.1%)
Factset Research Systems,
Inc. 12,600 452
Fair Isaac Corp. 17,700 646
Harris Corp. 25,754 803
Helix Technology Corp. 9,100 121
Keithley Instruments, Inc. 8,800 136
Lowrance Electronics, Inc. 6,100 128
</Table>
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
INFORMATION TECHNOLOGY--CONTINUED
Nam Tai Electronics, Inc. 12,800 $ 291
Reynolds & Reynolds Co.
(The), Cl A 22,000 595
-------
3,172
-------
MATERIALS (7.5%)
Agnico-Eagle Mines Ltd. 16,100 203
Airgas, Inc. 18,600 458
Allegheny Technologies, Inc. 11,500 254
Cambrex Corp. 13,100 250
RPM International, Inc. 14,300 261
Sappi Ltd. ADR 27,200 294
Valspar Corp. (The) 5,500 266
-------
1,986
-------
UTILITIES (1.2%)
Companhia de Saneamento
Basico ADR 20,200 304
-------
Total Common Stocks
(Cost $19,011) 24,635
-------
SHORT-TERM INVESTMENT (1.6%)
CSFB Enhanced Liquidity
Portfolio (c) 422,533 423
-------
Total Short-Term Investment
(Cost $423) 423
-------
MONEY MARKET FUNDS (6.3%)
Federated Government
Obligations Fund 454,799 455
Federated Prime Value
Obligations Fund, Cl I 1,200,323 1,200
-------
Total Money Market Funds
(Cost $1,655) 1,655
-------
Total Investments
(Cost $21,089) (a) --101.5% 26,713
Liabilities in excess of other
assets -- (1.5)% (400)
-------
Net Assets -- 100.0% $26,313
=======
</Table>
18
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except shares)
SMALL CAP VALUE EQUITY FUND -- CONCLUDED
- ---------------
* Non-income producing security.
(a) Cost for federal income tax purposes is $21,089
(amount in thousands). Unrealized appreciation/ (depreciation) on a tax
basis is as follows (amounts in thousands):
<Table>
Unrealized Appreciation................ $6,241
Unrealized Depreciation................ (617)
------
Unrealized Appreciation
(Depreciation)....................... $5,624
======
</Table>
(b) This security or a partial position of the security was
on loan at June 30, 2005. The total value of securities on loan at June
30, 2005 in thousands was $413.
(c) This security was purchased with cash collateral
held from securities lending.
ADR -- American Depository Receipt
Cl -- Class
See notes to financial statements.
19
(Unaudited)
VALUE INCOME STOCK FUND
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
COMMON STOCKS (97.7%)
CONSUMER DISCRETIONARY (7.7%)
Dow Jones & Co., Inc. (b) 20,000 $ 709
Gannett Co., Inc. 10,850 771
Leggett & Platt, Inc. 11,691 311
Mattel, Inc. 26,200 479
Newell Rubbermaid, Inc. 13,242 316
Viacom, Inc., Cl B 18,450 591
-------
3,177
-------
CONSUMER STAPLES (10.1%)
Archer Daniels Midland Co. 23,550 503
Colgate-Palmolive Co. 14,900 744
General Mills, Inc. 9,450 442
H.J. Heinz Co. 13,150 466
Kimberly-Clark Corp. 10,650 667
Kraft Foods, Inc., Cl A 18,000 573
PepsiCo, Inc. 14,300 770
-------
4,165
-------
ENERGY (9.2%)
BP PLC ADR 14,300 892
ChevronTexaco Corp. 16,250 910
Exxon Mobil Corp. 15,250 876
Marathon Oil Corp. 9,450 504
Tidewater, Inc. 15,484 590
-------
3,772
-------
FINANCIALS (23.8%)
A.G. Edwards, Inc. 7,300 330
Astoria Financial Corp. 13,800 393
Bank of America Corp. 13,600 620
Bank of New York Co., Inc.
(The) 23,050 663
Bear, Stearns & Co., Inc. 5,900 613
Citigroup, Inc. 13,091 605
Colonial BancGroup, Inc.
(The) 16,300 360
Comerica, Inc. 10,884 629
Compass Bancshares, Inc. 10,000 450
FirstMerit Corp. 14,474 378
</Table>
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
FINANCIALS--CONTINUED
Huntington Bancshares, Inc. 12,955 $ 313
JPMorgan Chase & Co. 12,395 438
Merrill Lynch & Co., Inc. 8,150 448
Morgan Stanley 8,350 438
Nationwide Financial
Services, Inc., Cl A 6,024 229
Northern Trust Corp. 11,600 529
PNC Financial Services Group,
Inc. (The) 5,900 321
Provident Financial Services,
Inc. 19,250 338
South Financial Group, Inc.
(The) 16,318 464
U.S. Bancorp 21,450 626
Washington Mutual, Inc. 15,400 627
-------
9,812
-------
HEALTH CARE (7.1%)
Abbott Laboratories 19,800 971
Becton, Dickinson & Co. 6,500 341
Johnson & Johnson 4,800 312
PerkinElmer, Inc. 17,314 327
Wyeth 21,600 961
-------
2,912
-------
INDUSTRIALS (16.0%)
3M Co. 5,600 405
Cintas Corp. 11,750 454
Dover Corp. 17,750 646
Emerson Electric Co. 11,650 730
General Electric Co. 23,350 809
Honeywell International,
Inc. 24,950 913
MSC Industrial Direct Co.,
Inc., Cl A 8,400 284
Pall Corp. 16,734 508
Parker Hannifin Corp. 3,500 217
Pitney Bowes, Inc. 7,183 313
R.R. Donnelley & Sons Co. 16,376 565
</Table>
20
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except
shares)
VALUE INCOME STOCK FUND -- CONCLUDED
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
INDUSTRIALS--CONTINUED
Rockwell Automation, Inc. 8,950 $ 436
Ryder System, Inc. 8,450 309
-------
6,589
-------
INFORMATION TECHNOLOGY (4.3%)
Automatic Data Processing,
Inc. 12,000 504
Harris Corp. 10,087 315
Intersil Corp., Cl A 16,748 314
Nokia Corp. ADR 19,000 316
Tektronix, Inc. 13,950 325
-------
1,774
-------
MATERIALS (8.2%)
Alcoa, Inc. 22,850 597
Bemis Co., Inc. 11,400 303
Cytec Industries, Inc. 7,900 314
Domtar, Inc. 33,670 249
E.I. du Pont de Nemours &
Co. 15,850 681
International Paper Co. 18,500 559
Sappi Ltd. ADR 31,117 337
Valspar Corp. (The) 6,550 316
-------
3,356
-------
TELECOMMUNICATION SERVICES (7.5%)
BellSouth Corp. 35,500 943
SBC Communications, Inc. 35,750 849
Sprint Corp. (b) 16,150 405
Verizon Communications, Inc. 25,640 886
-------
3,083
-------
UTILITIES (3.8%)
Cinergy Corp. 7,762 348
National Fuel Gas Co. 3,685 107
NiSource, Inc. (b) 10,100 250
Pepco Holdings, Inc. 10,252 245
</Table>
<Table>
<Caption>
- -----------------------------------------------------
Shares Value
- -----------------------------------------------------
UTILITIES--CONTINUED
Southern Co. (b) 10,400 $ 361
Xcel Energy, Inc. 12,825 250
-------
1,561
-------
Total Common Stocks
(Cost $37,420) 40,201
-------
SHORT-TERM INVESTMENT (4.3%)
CSFB Enhanced Liquidity
Portfolio (c) 1,765,256 1,765
-------
Total Short-Term Investment
(Cost $1,765) 1,765
-------
Total Investments
(Cost $39,185) (a) -- 102.0% 41,966
Liabilities in excess of other
assets -- (2.0)% (829)
-------
Net Assets -- 100.0% $41,137
=======
</Table>
- ---------------
(a) Cost for federal income tax purposes is $39,224
(amount in thousands). Unrealized appreciation/ (depreciation) on a tax
basis is as follows (amounts in thousands):
<Table>
Unrealized Appreciation............... $ 3,780
Unrealized Depreciation............... (1,038)
-------
Unrealized Appreciation
(Depreciation)...................... $ 2,742
=======
</Table>
(b) This security or a partial position of the security was
on loan at June 30, 2005. The total value of securities on loan at June
30, 2005 in thousands was $1,708.
(c) This security was purchased with cash collateral
held from securities lending.
ADR -- American Depository Receipt
Cl -- Class
See notes to financial statements.
21
(Unaudited)
INVESTMENT GRADE BOND FUND
<Table>
<Caption>
- -----------------------------------------------------
Shares or
Principal
Amount Value
- -----------------------------------------------------
ASSET BACKED SECURITIES (5.6%)
AUTO MANUFACTURERS (0.7%)
DaimlerChrysler Auto Trust,
Ser 2003, Cl A3, 2.120%,
11/08/06 (e) $ 103 $ 102
-------
CREDIT CARD ABS (4.9%)
American Express Credit
Account Master Trust, Ser
2002-3, Cl A, 5.530%,
10/15/08 (e) 250 254
Bank One Issuance Trust, Ser
2002, Cl A4, 2.940%,
06/16/08 250 249
Fleet Credit Card Master
Trust II, Ser 2003, Cl A,
2.400%, 07/15/08 (e) 250 248
-------
751
-------
Total Asset Backed Securities
(Cost $853) 853
-------
CORPORATE BONDS (25.4%)
AEROSPACE/DEFENSE (0.5%)
United Technologies Corp.,
4.875%, 05/01/15 80 82
-------
AIRLINES (0.6%)
Southwest Airlines Co.,
5.125%, 03/01/17 90 88
-------
AUTO MANUFACTURERS (0.4%)
DaimlerChrysler NA Holdings,
8.500%, 01/18/31 50 63
-------
BANKS (0.8%)
Bank of America Corp.,
7.400%, 01/15/11 100 114
-------
BUILDING MATERIALS (0.4%)
American Standard, Inc.,
7.625%, 02/15/10 55 61
-------
</Table>
<Table>
<Caption>
- -----------------------------------------------------
Shares or
Principal
Amount Value
- -----------------------------------------------------
COMMERCIAL SERVICES (0.8%)
ERAC USA Finance Co., 5.600%,
05/01/15 (d) $ 40 $ 41
R. R. Donnelley & Sons Co.,
4.950%, 04/01/14 75 74
-------
115
COMPUTERS (0.1%)
NCR Corp., 7.125%, 06/15/09 20 22
-------
DIVERSIFIED FINANCIAL SERVICES (8.6%)
Capital One Financial Corp.,
4.800%, 02/21/12 35 35
CIT Group, Inc., 5.125%,
09/30/14 80 81
Citigroup, Inc., 5.125%,
05/05/14 40 42
Citigroup, Inc., 5.850%,
12/11/34 55 61
Ford Motor Credit Co.,
7.000%, 10/01/13 100 96
Fund American Cos., Inc.,
5.875%, 05/15/13 105 109
Goldman Sachs Group, Inc.
(The), 4.750%, 07/15/13 115 115
HSBC Holdings PLC, 7.625%,
05/17/32 (d) 45 59
John Deere Capital Corp.,
3.900%, 01/15/08 25 25
JPMorgan Chase & Co., 6.625%,
03/15/12 130 145
Lazard Group LLC, 7.125%,
05/15/15 (d) 175 177
MBNA Corp., 6.125%, 03/01/13 110 120
Merrill Lynch & Co., Inc.,
3.700%, 04/21/08 20 20
</Table>
22
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except
shares)
INVESTMENT GRADE BOND FUND -- CONTINUED
<Table>
<Caption>
- -----------------------------------------------------
Shares or
Principal
Amount Value
- -----------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--CONTINUED
Merrill Lynch & Co., Inc.,
5.000%, 01/15/15 $ 55 $ 56
Morgan Stanley, 5.300%,
03/01/13 145 151
-------
1,292
-------
ELECTRIC (1.7%)
Entergy Gulf States, Inc.,
4.875%, 11/01/11, Callable
11/01/06 @ 100 40 40
Exelon Corp., 5.625%,
06/15/35 125 125
Pacific Gas & Electric Co.,
6.050%, 03/01/34 85 94
-------
259
-------
ENTERTAINMENT (0.2%)
GTECH Holdings Corp., 4.750%,
10/15/10 30 30
-------
HOME BUILDERS (0.6%)
Lennar Corp., 5.950%,
03/01/13 25 27
Pulte Homes, Inc., 4.875%,
07/15/09 40 40
Pulte Homes, Inc., 5.250%,
01/15/14 30 30
-------
97
-------
INSURANCE (0.7%)
MetLife, Inc., 5.000%,
06/15/15 40 41
Prudential Financial, Inc.,
3.750%, 05/01/08 25 25
Prudential Financial, Inc.,
5.100%, 09/20/14 40 41
-------
107
-------
INVESTMENT COMPANIES (0.3%)
Credit Suisse First Boston
USA, Inc., 6.500%, 01/15/12 45 50
-------
</Table>
<Table>
<Caption>
- -----------------------------------------------------
Shares or
Principal
Amount Value
- -----------------------------------------------------
LEISURE TIME (0.2%)
Harley Davidson Funding,
3.625%, 12/15/08 (d) $ 30 $ 29
-------
LODGING (0.6%)
Harrah's Operating Co., Inc.,
5.375%, 12/15/13 (b) 30 30
Marriott International, Inc.,
4.625%, 06/15/12 60 60
-------
90
-------
MEDIA (2.3%)
Comcast Cable Communications,
Inc., 7.125%, 06/15/13 90 103
Comcast Cable Communications,
Inc., 7.050%, 03/15/33 15 18
Cox Communications, Inc.,
4.625%, 06/01/13 50 49
News America Holdings, Inc.,
9.250%, 02/01/13 45 57
News America Holdings, Inc.,
6.200%, 12/15/34 25 26
Time Warner, Inc., 7.625%,
04/15/31 80 100
-------
353
-------
MINING (1.2%)
Alcan, Inc., 5.750%, 06/01/35 40 41
Codelco, Inc., 5.500%,
10/15/13 (d) 60 63
Inco Ltd., 5.700%, 10/15/15 75 77
-------
181
-------
MISCELLANEOUS MANUFACTURER (1.4%)
General Electric Co., 5.000%,
02/01/13 210 217
-------
</Table>
23
(Unaudited)
<Table>
<Caption>
- -----------------------------------------------------
Shares or
Principal
Amount Value
- -----------------------------------------------------
OIL & GAS (0.8%)
Devon Energy Corp., 10.250%,
11/01/05 $ 5 $ 5
Devon Financing Corp. ULC,
7.875%, 09/30/31 30 39
Enterprise Products Operating
LP, Ser B, 6.875%, 03/01/33 40 45
Motiva Enterprises LLC,
5.200%, 09/15/12 (d) 25 26
-------
115
-------
PIPELINES (1.1%)
Centerpoint Energy Resources
Corp., Ser B, 7.875%,
04/01/13 65 76
K N Capital Trust III,
7.630%, 04/15/28 50 59
Kinder Morgan, Inc., 7.250%,
03/01/28 20 24
-------
159
-------
REITS (0.1%)
Simon Property Group LP,
6.375%, 11/15/07 20 21
-------
RETAIL (0.2%)
Federated Department Stores,
Inc., 6.900%, 04/01/29 (b) 20 23
-------
SAVINGS & LOANS (0.3%)
Golden West Financial Corp.,
4.125%, 08/15/07 45 45
-------
</Table>
<Table>
<Caption>
- -----------------------------------------------------
Shares or
Principal
Amount Value
- -----------------------------------------------------
TELECOMMUNICATIONS (1.5%)
SBC Communications, Inc.,
6.450%, 06/15/34 $ 40 $ 45
Sprint Capital Corp., 8.750%,
03/15/32 85 118
Verizon Global Funding Corp.,
7.750%, 12/01/30 (b) 55 71
-------
234
-------
Total Corporate Bonds
(Cost $3,716) 3,847
-------
U.S. GOVERNMENT AGENCIES (13.9%)
FREDDIE MAC (13.9%)
3.750%, 04/15/07 2,100 2,098
-------
Total U.S. Government Agencies
(Cost $2,088) 2,098
-------
U.S. TREASURY OBLIGATIONS (53.1%)
U.S. TREASURY BONDS (8.8%)
5.375%, 02/15/31 (b) 1,125 1,328
-------
U.S. TREASURY NOTES (44.3%)
1.500%, 07/31/05 (b) 165 165
3.500%, 11/15/06 505 504
3.125%, 05/15/07 525 520
3.500%, 05/31/07 (b) 1,325 1,321
3.125%, 04/15/09 (b) 190 186
6.000%, 08/15/09 1,755 1,906
3.625%, 06/15/10 (b) 540 538
4.250%, 08/15/13 (b) 1,530 1,568
-------
6,708
-------
Total U.S. Treasury Obligations
(Cost $7,908) 8,036
-------
SHORT-TERM INVESTMENTS (36.2%)
CSFB Enhanced Liquidity
Portfolio (c) 5,474,784 5,475
-------
Total Short-Term Investments
(Cost $5,475) 5,475
-------
</Table>
24
SCHEDULE OF PORTFOLIO INVESTMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005 (Amounts in thousands, except
shares)
INVESTMENT GRADE BOND FUND -- CONTINUED
<Table>
<Caption>
- -----------------------------------------------------
Shares or
Principal
Amount Value
- -----------------------------------------------------
MONEY MARKET FUNDS (1.0%)
Federated Prime Value Money
Market Fund 155,696 $ 156
-------
Total Money Market Funds
(Cost $156) 156
-------
Total Investments
(Cost $20,196) (a) -- 135.2% 20,465
Liabilities in excess of other
assets -- (35.2)% (5,325)
-------
Net Assets -- 100.0% $15,140
=======
</Table>
- ---------------
(a) Cost for federal income tax purposes is $20,224
(amount in thousands). Unrealized appreciation/ (depreciation) on a tax
basis is as follows (amounts in thousands):
<Table>
Unrealized Appreciation................. $254
Unrealized Depreciation................. (13)
----
Unrealized Appreciation
(Depreciation)........................ $241
====
</Table>
(b) This security or a partial position of the security was
on loan at June 30, 2005. The total value of securities on loan at June
30, 2005 in thousands was $5,318.
(c) This security was purchased with cash collateral
held from securities lending.
(d) Rule 144A, Section 4(2) or other security which is
restricted as to resale to institutional investors. The Fund's advisor has
deemed this security to be liquid based upon procedures approved by the
Board of Trustees.
(e) Variable rate security. Rate presented represents rate
in effect at June 30, 2005. Maturity date represents actual maturity date.
Cl -- Class
LLC -- Limited Liability Company
LP -- Limited Partnership
REIT -- Real Estate Investment Trust
Ser -- Series
See notes to financial statements
25
STATEMENTS OF ASSETS AND LIABILITIES (000)
STI CLASSIC VARIABLE TRUST June 30, 2005 (Unaudited)
<Table>
<Caption>
Small Cap Value Investment
Capital Growth Mid-Cap Value Income Grade
Appreciation and Income International Equity Equity Stock Bond
Fund Fund Equity Fund Fund Fund Fund Fund
------------ ---------- ------------- ------- --------- ------- ----------
Assets:
Investments, at Cost................... $48,220 $10,383 $ 4,240 16,088 $21,089 $39,185 $20,196
------- ------- ------- ------ ------- ------- -------
Investments, at Value.................. $51,929 $11,968 $ 5,401 18,593 $26,713 $41,966 $20,465
Foreign currency, at value (cost
$16)................................. -- -- 16 -- -- -- --
Accrued Income......................... 47 19 8 21 35 55 173
Receivable for Investment Securities
Sold................................. 1,304 53 21 427 346 1,809 125
Receivable from Investment Adviser..... -- -- 7 -- -- -- --
Reclaims Receivable.................... -- -- 8 -- -- -- --
------- ------- ------- ------ ------- ------- -------
Total Assets........................... 53,280 12,040 5,461 19,041 27,094 43,830 20,763
------- ------- ------- ------ ------- ------- -------
Liabilities:
Payable to Custodian................... 19 -- -- -- -- 126 --
Income Distributions payable........... -- -- -- -- -- -- 46
Payable for Investment Securities
Purchased............................ 52 45 32 297 309 727 74
Payable Upon Return of Securities
Loaned............................... 4,213 183 31 3,088 423 1,765 5,475
Investment Advisory Fees Payable....... 43 9 -- 12 23 28 7
Administration Fees Payable............ 1 -- -- -- 1 1 --
Custodian Fees Payable................. 5 6 2 9 4 7 8
Accrued Expenses....................... 47 9 5 13 21 39 13
------- ------- ------- ------ ------- ------- -------
Total Liabilities...................... 4,380 252 70 3,419 781 2,693 5,623
------- ------- ------- ------ ------- ------- -------
Total Net Assets....................... $48,900 $11,788 $ 5,391 15,622 $26,313 $41,137 $15,140
======= ======= ======= ====== ======= ======= =======
Net Assets:
Capital................................ $43,959 $ 9,852 $ 6,646 13,742 $16,071 $46,539 $15,053
Accumulated Net Investment Income...... 4 5 110 4 11 13 17
Accumulated Net Realized Gains (Losses)
on Investments and Foreign Currency
Transactions......................... 1,228 346 (2,525) (629) 4,607 (8,196) (199)
Net Unrealized Appreciation
(Depreciation) on Investments and
Foreign Currency Transactions........ 3,709 1,585 1,160 2,505 5,624 (2,781) 269
------- ------- ------- ------ ------- ------- -------
Total Net Assets:...................... $48,900 $11,788 $ 5,391 15,622 $26,313 $41,137 $15,140
======= ======= ======= ====== ======= ======= =======
Shares Outstanding:.................... 3,121 1,005 498 1,239 1,450 2,913 1,451
Net Asset Value and Redemption Price
Per Share:........................... $ 15.67 $ 11.72 $ 10.81 $12.60 $ 18.15 $ 14.12 $ 10.43
</Table>
Amounts designated as "--" are $0 or have been rounded to $0.
See notes to financial statements.
26
STATEMENTS OF OPERATIONS (000)
STI CLASSIC VARIABLE TRUST For the Period Ended June 30, 2005 (Unaudited)
<Table>
<Caption>
Small Cap Value Investment
Capital Growth Mid-Cap Value Income Grade
Appreciation and Income International Equity Equity Stock Bond
Fund Fund Equity Fund Fund Fund Fund Fund
------------ ---------- ------------- ------- --------- ------- ----------
Investment Income:
Dividend Income......................... $ 315 $ 116 $ 113 $ 111 $ 214 $ 529 $ --
Interest Income......................... -- -- 2 -- -- -- 328
Income from Securities Lending.......... 3 -- -- 7 2 1 8
Less: Foreign Taxes Withheld............ -- -- (12) -- -- -- --
------- ----- ----- ------ ------- ------- ----
Total Investment Income................. 318 116 103 118 216 530 336
------- ----- ----- ------ ------- ------- ----
Expenses:
Investment Advisory Fees................ 294 50 36 89 146 175 60
Administration Fees..................... 7 1 1 2 3 6 2
Custodian Fees.......................... 6 7 51 10 6 9 9
Professional Fees....................... 16 3 1 5 8 12 4
Insurance fees.......................... 1 -- -- -- -- 1 --
Transfer Agent Fees..................... (10) (2) (1) (3) (5) (9) (3)
Printing Fees........................... 17 4 2 5 9 15 6
Other Expenses.......................... -- 1 20 2 1 1 2
------- ----- ----- ------ ------- ------- ----
Total Expenses.......................... 331 64 110 110 168 210 80
Less: Investment Advisory Fees Waived or
Fees Reimbursed....................... (36) -- (64) (20) (16) (6) (19)
------- ----- ----- ------ ------- ------- ----
Net Expenses............................ 295 64 46 90 152 204 61
------- ----- ----- ------ ------- ------- ----
Net Investment Income................... 23 52 57 28 64 326 275
------- ----- ----- ------ ------- ------- ----
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currency
Transactions:
Net Realized Gain on Investments Sold
and Foreign Currency Transactions..... 1,308 620 407 1,885 1,602 3,614 112
Net Change in Unrealized Appreciation
(Depreciation) on Investments and
Foreign Currency Transactions......... (3,775) (352) (594) (971) (1,847) (4,223) 24
------- ----- ----- ------ ------- ------- ----
Total Net Realized and Unrealized Gain
(Loss) on Investments and Foreign
Currency Transactions................. (2,467) 268 (187) 914 (245) (609) 136
------- ----- ----- ------ ------- ------- ----
Change in Net Assets from Operations..... $(2,444) $ 320 $(130) $ 942 $ (181) $ (283) $411
======= ===== ===== ====== ======= ======= ====
</Table>
Amounts designated as "--" are $0 or have been rounded to $0.
See notes to financial statements.
27
STATEMENTS OF CHANGES IN NET ASSETS (000)
STI CLASSIC VARIABLE TRUST For the Periods Indicated
<Table>
<Caption>
Capital Appreciation Fund Growth and Income Fund International Equity Fund
-------------------------- -------------------------- --------------------------
01/01/05- 01/01/04- 01/01/05- 01/01/04- 01/01/05- 01/01/04-
06/30/05 12/31/04 06/30/05 12/31/04 06/30/05 12/31/04
----------- ----------- ----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited)
Operations:
Net Investment Income (Loss)............ $ 23 $ 108 $ 52 $ 91 $ 57 $ 49
Net Realized Gain (Loss) on Investments
Sold and Foreign Currency
Transactions.......................... 1,308 6,819 620 606 407 776
Net Change in Unrealized Appreciation
(Depreciation) on Investments and
Foreign Currency Transactions......... (3,775) (3,419) (352) 705 (594) 287
------- -------- ------- ------- ------ -------
Change in Net Assets from Operations.... (2,444) 3,508 320 1,402 (130) 1,112
------- -------- ------- ------- ------ -------
Dividends and Distributions to
Shareholders:
Net Investment Income................... (25) (102) (48) (90) -- (105)
------- -------- ------- ------- ------ -------
Capital Transactions:
Proceeds from Shares Issued............. 3,609 5,856 1,132 2,801 180 347
Dividends Reinvested.................... 25 102 48 90 -- 105
Cost of Shares Redeemed................. (7,127) (13,869) (1,108) (1,957) (902) (2,136)
------- -------- ------- ------- ------ -------
Change in Net Assets from Capital
Transactions.......................... (3,493) (7,911) 72 934 (722) (1,684)
------- -------- ------- ------- ------ -------
Change in Net Assets.................... (5,962) (4,505) 344 2,246 (852) (677)
------- -------- ------- ------- ------ -------
Net Assets:
Beginning of Period..................... 54,862 59,367 11,444 9,198 6,243 6,920
------- -------- ------- ------- ------ -------
End of Period........................... $48,900 $ 54,862 $11,788 $11,444 $5,391 $ 6,243
======= ======== ======= ======= ====== =======
Undistributed Net Investment Income, End
of Period............................... $ 4 $ 6 $ 5 $ 1 $ 110 $ 53
======= ======== ======= ======= ====== =======
Share Transactions:
Issued.................................. 227 376 98 269 16 37
Reinvested.............................. 2 6 4 8 -- 11
Redeemed................................ (450) (893) (97) (188) (82) (218)
------- -------- ------- ------- ------ -------
Change in Share Transactions............ (221) (511) 5 89 (66) (170)
======= ======== ======= ======= ====== =======
</Table>
See notes to financial statements.
28
STATEMENTS OF CHANGES IN NET ASSETS (000)
STI CLASSIC VARIABLE TRUST For the Periods Indicated
<Table>
<Caption>
Mid-Cap Equity Fund Small Cap Value Equity Fund Value Income Stock Fund
-------------------------- ---------------------------- --------------------------
01/01/05- 01/01/04- 01/01/05- 01/01/04- 01/01/05- 01/01/04-
06/30/05 12/31/04 06/30/05 12/31/04 06/30/05 12/31/04
----------- ----------- ------------ ------------ ----------- -----------
(Unaudited) (Unaudited) (Unaudited)
Operations:
Net Investment Income................. $ 28 $ 113 $ 64 $ 73 $ 326 $ 639
Net Realized Gain on Investments Sold
and Foreign Currency Transactions... 1,885 1,584 1,602 3,468 3,614 5,423
Net Change in Unrealized Appreciation
(Depreciation) on Investments and
Foreign Currency Transactions....... (971) 733 (1,847) 1,457 (4,223) 279
------- ------- ------- ------- ------- --------
Change in Net Assets from Operations.. 942 2,430 (181) 4,998 (283) 6,341
------- ------- ------- ------- ------- --------
Dividends and Distributions to
Shareholders:
Net Investment Income................. (30) (107) (66) (60) (313) (646)
------- ------- ------- ------- ------- --------
Capital Transactions:
Proceeds from Shares Issued........... 522 1,914 2,320 3,370 1,602 7,126
Dividends Reinvested.................. 30 107 66 60 313 646
Cost of Shares Redeemed............... (2,224) (4,144) (1,786) (2,789) (7,195) (11,938)
------- ------- ------- ------- ------- --------
Change in Net Assets from Capital
Transactions........................ (1,672) (2,123) 600 641 (5,280) (4,166)
------- ------- ------- ------- ------- --------
Change in Net Assets.................. (760) 200 353 5,579 (5,876) 1,529
------- ------- ------- ------- ------- --------
Net Assets:
Beginning of Period................... 16,382 16,182 25,960 20,381 47,013 45,484
------- ------- ------- ------- ------- --------
End of Period......................... $15,622 $16,382 $26,313 $25,960 $41,137 $ 47,013
======= ======= ======= ======= ======= ========
Undistributed Net Investment Income,
End of Period......................... $ 4 $ 6 $ 11 $ 13 $ 13 $ --
======= ======= ======= ======= ======= ========
Share Transactions:
Issued................................ 43 182 130 210 113 533
Reinvested............................ 2 10 4 4 22 48
Redeemed.............................. (186) (393) (100) (175) (506) (908)
------- ------- ------- ------- ------- --------
Change in Share Transactions.......... (141) (201) 34 39 (371) (327)
======= ======= ======= ======= ======= ========
<Caption>
Investment Grade Bond Fund
--------------------------
01/01/05- 01/01/04-
06/30/05 12/31/04
----------- -----------
(Unaudited)
Operations:
Net Investment Income................. $ 275 $ 648
Net Realized Gain on Investments Sold
and Foreign Currency Transactions... 112 236
Net Change in Unrealized Appreciation
(Depreciation) on Investments and
Foreign Currency Transactions....... 24 (156)
------- -------
Change in Net Assets from Operations.. 411 728
------- -------
Dividends and Distributions to
Shareholders:
Net Investment Income................. (281) (629)
------- -------
Capital Transactions:
Proceeds from Shares Issued........... 535 1,401
Dividends Reinvested.................. 287 640
Cost of Shares Redeemed............... (2,859) (5,409)
------- -------
Change in Net Assets from Capital
Transactions........................ (2,037) (3,368)
------- -------
Change in Net Assets.................. (1,907) (3,269)
------- -------
Net Assets:
Beginning of Period................... 17,047 20,316
------- -------
End of Period......................... $15,140 $17,047
======= =======
Undistributed Net Investment Income,
End of Period......................... $ 17 $ 23
======= =======
Share Transactions:
Issued................................ 52 137
Reinvested............................ 28 62
Redeemed.............................. (278) (527)
------- -------
Change in Share Transactions.......... (198) (328)
======= =======
</Table>
Amounts designated as "--" are either $0 or have been rounded to $0.
See notes to financial statements.
29
(This page intentionally left blank)
30
FINANCIAL HIGHLIGHTS
STI CLASSIC VARIABLE TRUST
Selected Data for a Share of Beneficial Interest Outstanding Throughout the
Periods Ended.
<Table>
<Caption>
Net Realized and Unrealized
Net Gains (Losses) on
Net Asset Value, Investment Investments and Foreign
Beginning of Year Income (Loss) Currency Transactions
----------------- ------------- ---------------------------
CAPITAL APPRECIATION FUND
June 30, 2005* $16.42 0.01 (0.75)
December 31, 2004 $15.41 0.03 1.01
December 31, 2003 $13.01 (0.03)(a) 2.43(a)
December 31, 2002 $17.48 (0.07) (3.74)
December 31, 2001 $20.02 (0.05) (1.27)
December 31, 2000 $20.27 0.03 0.65
GROWTH AND INCOME FUND
June 30, 2005* $11.45 0.05 0.27
December 31, 2004 $10.10 0.09(a) 1.35(a)
December 31, 2003 $ 8.05 0.08(a) 2.04(a)
December 31, 2002 $10.21 0.06 (2.16)
December 31, 2001 $10.86 0.04 (0.65)
December 31, 2000 $10.00 0.07 0.86
INTERNATIONAL EQUITY FUND
June 30, 2005* $11.06 0.13 (0.38)
December 31, 2004 $ 9.43 0.11 1.69
December 31, 2003 $ 6.92 0.07(a) 2.50(a)
December 31, 2002 $ 8.55 0.02 (1.61)
December 31, 2001 $10.36 -- (1.80)
December 31, 2000 $13.93 0.08 (0.58)
MID-CAP EQUITY FUND
June 30, 2005* $11.87 0.02 0.73
December 31, 2004 $10.23 0.08 1.63
December 31, 2003 $ 7.93 0.05(a) 2.30(a)
December 31, 2002 $11.09 (0.04) (3.11)
December 31, 2001 $13.30 -- (0.19)
December 31, 2000 $15.20 (0.04) (0.13)
SMALL CAP VALUE EQUITY FUND
June 30, 2005* $18.33 0.04 (0.17)
December 31, 2004 $14.80 0.05(a) 3.52(a)
December 31, 2003 $10.75 0.07(a) 4.05(a)
December 31, 2002 $10.94 0.06 (0.19)
December 31, 2001 $ 9.12 0.12 1.82
December 31, 2000 $ 7.97 0.14 1.15
VALUE INCOME STOCK FUND
June 30, 2005* $14.32 0.10 (0.20)
December 31, 2004 $12.60 0.19 1.72
December 31, 2003 $10.39 0.17(a) 2.21(a)
December 31, 2002 $12.70 0.16 (2.31)
December 31, 2001 $13.06 0.16 (0.32)
December 31, 2000 $13.23 0.26 0.98
INVESTMENT GRADE BOND FUND
June 30, 2005* $10.34 0.18 0.09
December 31, 2004 (b) $10.27 0.36 0.06
December 31, 2003 $10.29 0.34(a) 0.02(a)
December 31, 2002 $10.05 0.44 0.28
December 31, 2001 $ 9.69 0.52 0.36
December 31, 2000 $ 9.73 0.62 (0.04)
<Caption>
Dividends from Distributions Total
Total From Net Investment from Realized Dividends and
Operations Income Capital Gains Distributions
---------- -------------- ------------- -------------
CAPITAL APPRECIATION FUND
June 30, 2005* (0.74) (0.01) -- (0.01)
December 31, 2004 1.04 (0.03) -- (0.03)
December 31, 2003 2.40 -- -- --
December 31, 2002 (3.81) -- (0.66) (0.66)
December 31, 2001 (1.32) -- (1.22) (1.22)
December 31, 2000 0.68 (0.03) (0.90) (0.93)
GROWTH AND INCOME FUND
June 30, 2005* 0.32 (0.05) -- (0.05)
December 31, 2004 1.44 (0.09) -- (0.09)
December 31, 2003 2.12 (0.07) -- (0.07)
December 31, 2002 (2.10) (0.06) -- (0.06)
December 31, 2001 (0.61) (0.04) -- (0.04)
December 31, 2000 0.93 (0.07) -- (0.07)
INTERNATIONAL EQUITY FUND
June 30, 2005* (0.25) -- -- --
December 31, 2004 1.80 (0.17) -- (0.17)
December 31, 2003 2.57 (0.06) -- (0.06)
December 31, 2002 (1.59) -- (0.04) (0.04)
December 31, 2001 (1.80) -- (0.01) (0.01)
December 31, 2000 (0.50) -- (3.07) (3.07)
MID-CAP EQUITY FUND
June 30, 2005* 0.75 (0.02) -- (0.02)
December 31, 2004 1.71 (0.07) -- (0.07)
December 31, 2003 2.35 (0.05) -- (0.05)
December 31, 2002 (3.15) -- (0.01) (0.01)
December 31, 2001 (0.19) -- (2.02) (2.02)
December 31, 2000 (0.17) -- (1.73) (1.73)
SMALL CAP VALUE EQUITY FUND
June 30, 2005* (0.13) (0.05) -- (0.05)
December 31, 2004 3.57 (0.04) -- (0.04)
December 31, 2003 4.12 (0.07) -- (0.07)
December 31, 2002 (0.13) (0.06) -- (0.06)
December 31, 2001 1.94 (0.12) -- 0.12
December 31, 2000 1.29 (0.14) -- (0.14)
VALUE INCOME STOCK FUND
June 30, 2005* (0.10) (0.10) -- (0.10)
December 31, 2004 1.91 (0.19) -- (0.19)
December 31, 2003 2.38 (0.17) -- (0.17)
December 31, 2002 (2.15) (0.16)*** -- (0.16)***
December 31, 2001 (0.16) (0.20) -- (0.20)
December 31, 2000 1.24 (0.26) (1.15) (1.41)
INVESTMENT GRADE BOND FUND
June 30, 2005* 0.27 (0.18) -- (0.18)
December 31, 2004 (b) 0.42 (0.35) -- (0.35)
December 31, 2003 0.36 (0.38) -- (0.38)
December 31, 2002 0.72 (0.48) -- (0.48)
December 31, 2001 0.88 (0.52) -- (0.52)
December 31, 2000 0.58 (0.62) -- (0.62)
</Table>
<Table>
+ Not annualized for periods less than one year.
++ Annualized for periods less than one year.
* Unaudited.
** Total return would have been (18.70)% without the payment by
affiliate. During the fiscal year ended December 31, 2002,
the International Equity Fund was reimbursed by the Adviser
for losses incurred of $5,807 due to the sale of shares in
several registered investment companies which were
inadvertently purchased in excess of the amount permitted
under applicable Securities and Exchange Commission rules.
*** Includes Return of Capital of $0.0049 per share.
(a) Amounts calculated using the average shares method.
(b) Effective January 1, 2004, the Investment Grade Bond Fund
adopted a change in the amortization and accretion
methodology on fixed income securities. (See Note 2.) The
cumulative effect of this change in methodology on December
31, 2004 was to increase net investment income to average
net assets from 3.40% to 3.52%; to increase net investment
income per share from $0.35 to $0.36; and, to decrease net
realized and unrealized gains (losses) per share from $0.07
to $0.06. Per share ratios and supplemental data for prior
periods have not been restated to reflect this change.
</Table>
Amounts designated as "-" are either $0 or have been rounded to $0.
31
<Table>
<Caption>
Net Asset Ratio of Net Ratio of Expenses to Average
Value, Net Assets, Ratio of Net Expenses Investment Income Net Assets (Excluding Portfolio
End of Total End of to Average Net (Loss) to Average Net Waivers, Reimbursements Turnover
Period Returns+ Year (000) Assets++ Assets++ and Expense Offset)++ Rate
- ---------- -------- ----------- --------------------- --------------------- ---------------------------- ---------
$15.67 (4.52)% $ 48,900 1.15% 0.09% 1.29% 49%
$16.42 6.75% $ 54,862 1.15% 0.19% 1.43% 79%
$15.41 18.45% $ 59,367 1.15% (0.21)% 1.50% 91%
$13.01 (21.89)% $ 56,718 1.15% (0.41)% 1.46% 67%
$17.48 (5.34)% $ 86,499 1.15% (0.30)% 1.44% 88%
$20.02 3.07% $101,964 1.15% 0.17% 1.38% 105%
$11.72 2.78% $ 11,788 1.15% 0.93% 1.15% 26%
$11.45 14.30% $ 11,444 1.18% 0.87% 1.53% 44%
$10.10 26.49% $ 9,198 1.20% 0.92% 2.20% 22%
$ 8.05 (20.59)% $ 4,354 1.20% 6.80% 2.56% 51%
$10.21 (5.57)% $ 4,278 1.20% 0.47% 3.22% 27%
$10.86 9.32% $ 1,784 1.20% 0.69% 8.04% 34%
$10.81 (2.26)% $ 5,391 1.58% 2.01% 3.82% 27%
$11.06 19.35% $ 6,243 1.60% 0.74% 3.89% 65%
$ 9.43 37.31% $ 6,920 1.60% 0.99% 3.91% 75%
$ 6.92 (18.58)%** $ 6,230 1.60% 0.27% 2.59% 115%
$ 8.55 (17.40)% $ 9,544 1.60% 0.25% 2.32% 92%
$10.36 (3.43)% $ 11,972 1.60% 0.64% 2.08% 126%
$12.60 6.35% $ 15,622 1.15% 0.37% 1.41% 51%
$11.87 16.82% $ 16,382 1.15% 0.71% 1.65% 79%
$10.23 29.72% $ 16,182 1.15% 0.60% 1.84% 182%
$ 7.93 (8.45)% $ 13,962 1.15% (0.32)% 1.72% 90%
$11.09 2.72% $ 21,938 1.15% 0.04% 1.66% 93%
$13.30 (2.93)% $ 23,714 1.15% (0.18)% 1.56% 106%
$18.15 (0.74)% $ 26,313 1.21% 0.49% 1.34% 19%
$18.33 24.19% $ 25,960 1.20% 0.33% 1.57% 52%
$14.80 38.44% $ 20,381 1.20% 0.56% 1.79% 27%
$10.75 (1.20)% $ 15,286 1.20% 0.55% 1.79% 17%
$10.94 21.48% $ 13,775 1.20% 1.05% 1.91% 55%
$ 9.12 16.37% $ 10,513 1.20% 1.69% 1.96% 72%
$14.12 (0.69)% $ 41,137 0.93% 1.49% 0.96% 56%
$14.32 15.29% $ 47,013 0.95% 1.43% 1.11% 85%
$12.60 23.12% $ 45,484 0.95% 1.52% 1.19% 54%
$10.39 (16.98)% $ 43,899 0.95% 1.37% 1.19% 50%
$12.70 (1.14)% $ 63,102 0.95% 1.20% 1.12% 73%
$13.06 10.43% $ 67,594 0.95% 2.01% 1.06% 72%
$10.43 2.63% $ 15,140 0.75% 3.40% 0.99% 113%
$10.34 4.16% $ 17,047 0.75% 3.52% 1.19% 197%
$10.27 3.51% $ 20,316 0.75% 3.66% 1.25% 147%
$10.29 7.40% $ 23,126 0.75% 4.33% 1.28% 144%
$10.05 9.20% $ 19,559 0.75% 5.15% 1.32% 139%
$ 9.69 6.32% $ 16,890 0.75% 6.54% 1.26% 123%
</Table>
See notes to financial statements.
32
NOTES TO FINANCIAL STATEMENTS
STI CLASSIC VARIABLE TRUST June 30, 2005
1. Organization
The STI Classic Variable Trust (the "Trust") was organized as a Massachusetts
business trust under a Declaration of Trust dated April 18, 1995. The Trust is
registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company offering seven funds as of June 30, 2005. The
financial statements presented herein are those of the Capital Appreciation
Fund, the Growth and Income Fund, the International Equity Fund, the Mid-Cap
Equity Fund, the Small Cap Value Equity Fund, the Value Income Stock Fund and
the Investment Grade Bond Fund (each a "Fund" and collectively the "Funds"). The
Trust is authorized to issue an unlimited number of shares without par value.
Shareholders have no preemptive rights. The assets of each Fund are segregated,
and a shareholder's interest is limited to the Fund in which shares are held.
Sales of shares of the Funds may only be made to separate accounts of various
life insurance companies and certain qualified benefit plans. The Funds'
prospectus provides a description of the Funds' investment objectives, policies
and strategies.
Under the Trust's organizational documents, its officers and trustees are
indemnified against certain liabilities arising out of the performance of their
duties to the Trust. In addition, in the normal course of business, the Trust
enters into contracts with their vendors and others that provide for general
indemnifications. The Trust's maximum exposure under these arrangements is
unknown as this would involve future claims that may be made against the Trust.
However, based on experience, the Trust expects that risk of loss to be remote.
2. Significant Accounting Policies:
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements. These policies are in
conformity with accounting principles generally accepted in the United States of
America ("GAAP"). The preparation of the financial statements in accordance with
GAAP requires management to make estimates and assumptions that effect the
reported amount of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported amounts
of income and expense during the reporting period. The actual results could
differ from these estimates.
Security Valuation -- Securities listed on a securities exchange, market or
automated quotation system for which quotations are readily available
(except for securities traded on NASDAQ), including equity securities
traded over the counter, are valued at the last quoted sale price on the
primary exchange or market (foreign or domestic) on which they are traded
on valuation date (or at approximately 4:00 pm Eastern Time if a security's
primary exchange is normally open at that time), or, if there is no such
reported sale on the valuation date, at the most recent quoted bid price.
For securities traded on NASDAQ, the NASDAQ Official Closing Price will be
used. If available, debt securities are priced based upon valuations
provided by independent, third-party pricing agents. Such values generally
reflect the last reported sale price if the security is actively traded.
The third-party pricing agents may also value debt securities at an
evaluated bid price by employing methodologies that utilize actual market
transactions, broker-supplied valuations, or other methodologies designed
to identify the market value for such securities. Debt obligations with
remaining maturities of sixty days or less may be valued at their amortized
cost, which approximates
33
(Unaudited)
market value. The prices for foreign securities are reported in local
currency and converted to U.S. dollars at the exchange rate of such
currencies against the U.S. dollar, as of the close of regular trading on
the New York Stock Exchange (usually 4:00 pm Eastern Time), as provided by
an independent pricing service approved by the Funds' Board of Trustees
(the "Board"). If a security price cannot be obtained from an independent,
third-party pricing agent, the Funds' administrator shall seek to obtain a
bid price from at least one independent broker.
Securities for which market prices are not "readily available" are valued
in accordance with Fair Value Procedures established by the Board. The
Funds' Fair Value Procedures will be performed and monitored by a Fair
Value Committee (the "Committee") designated by the Board. Some of the more
common reasons that may necessitate that a security be valued using Fair
Value Procedures include, but are not limited to: the security's trading
has been halted or suspended; the security has been de-listed from a
national exchange; the security's primary trading market is temporarily
closed at a time when under normal conditions it would be open; or the
security's primary pricing source is not able or willing to provide a
price. When a security is valued in accordance with the Fair Value
Procedures, the Committee will determine the value after taking into
consideration relevant information reasonably available to the Committee.
For securities that principally trade on a foreign market or exchange, a
significant gap in time can exist between the time of a particular
security's last trade and the time at which a Fund calculates its net asset
value. The closing prices of such securities may no longer reflect their
market value at the time the Fund calculates net asset value if an event
that could materially affect the value of those securities (a "Significant
Event") has occurred between the time of the security's last close and the
time that the Fund calculates net asset value. A Significant Event may
relate to a single issuer or to an entire market sector. If the adviser of
a Fund becomes aware of a Significant Event that has occurred with respect
to a security or group of securities after the closing of the exchange or
market on which the security or securities principally trade, but before
the time at which the Fund calculates net asset value, it shall immediately
notify the Funds' administrator and may preauthorize the Funds'
administrator to utilize a pricing service authorized by the Board (a "Fair
Value Pricing Service") that has been designed to determine a fair value.
On a day when a Fair Value Pricing Service is so utilized pursuant to a
preauthorization, the Pricing Committee need not meet. If the adviser does
not preauthorize the Funds' administrator to utilize a Fair Value Pricing
Service, the adviser will request that a Fair Value Committee Meeting be
called. In addition, the Funds' administrator monitors price movements
among certain selected indices, securities and/or baskets of securities
that may be an indicator that the closing prices received earlier from
foreign exchanges or markets may not reflect market value at the time the
Fund calculates net asset value. If price movements in a monitored index
exceed levels established by the Funds ("Trigger Points"), the Funds may
use a systematic valuation model provided by an independent third party to
fair value their international equity securities.
34
NOTES TO FINANCIAL STATEMENTS (continued)
STI CLASSIC VARIABLE TRUST June 30, 2005
Security Transactions and Investment Income -- Security transactions are
accounted for no later than one business day after trade date. However, for
financial reporting purposes, securities transactions are reported on trade
date. Interest income is recognized on an accrual basis. Cost used in
determining net realized gains and losses on the sales of investment
securities are those of the specific securities sold, adjusted for the
accretion or amortization of purchase discounts or premiums during the
respective holding period. Dividend income is recorded on the ex-dividend
date.
Effective January 1, 2004, the Investment Grade Bond changed its
amortization and accretion methodology on premiums and discounts on fixed
income securities in order to conform more closely to Internal Revenue Code
requirements. The cumulative effect of this accounting change had no impact
on total net assets, but resulted in an increase in interest income of
$21,220 and a decrease in unrealized appreciation/(depreciation) of $21,220
during the fiscal year ended December 31, 2004. The financial highlights
for prior periods have not been restated to reflect this change in
accounting methodology.
Repurchase Agreements -- The Funds may purchase instruments from financial
institutions, such as banks and broker-dealers, subject to the seller's
agreement to repurchase them at an agreed upon time and price ("repurchase
agreement"). A third party custodian bank takes possession of the
underlying securities ("collateral") of a repurchase agreement, the value
of which exceeds the principal amount of the repurchase transaction,
including accrued interest. In the event of default on the obligation to
repurchase, each Fund has the right to liquidate the collateral and apply
the proceeds in satisfaction of the obligation. In the event of default or
bankruptcy by the counterparty to the agreement, realization and/or
retention of the collateral or proceeds may be subject to legal
proceedings.
Foreign Currency Translation -- The books and records of the International
Equity Fund are maintained in U.S. dollars on the following basis: (i)
market value of investment securities, assets and liabilities at the
current rate of exchange; and (ii) purchases and sales of investment
securities, income and expenses at the relevant rates of exchange
prevailing on the respective dates of such transactions.
The International Equity Fund does not isolate the portion of operations
resulting from changes in foreign exchange rates on investments from
fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss
from investments and foreign currencies.
Expenses -- Expenses that are directly related to a specific Fund are
charged to that Fund. Other operating expenses of the Trust are pro-rated
to the Funds on the basis of relative net assets or another appropriate
basis.
Dividends and Distributions to Shareholders -- Dividends and distributions
to shareholders are recorded on the ex-dividend date. Dividends from net
investment income, if any, are declared and paid each calendar quarter for
all Funds except for the International Equity Fund, which distributes
income annually, and the Investment Grade Bond Fund, which distributes
daily and pays monthly. Any net realized capital gains on sales of
securities are distributed to shareholders at least annually. However, to
the extent that net realized capital
35
(Unaudited)
gains can be offset by capital loss carryovers, such gains will not be
distributed.
The amounts of dividends from net investment income and of distributions
from net realized gains are determined in accordance with federal income
tax regulations, which may differ from GAAP. These "book/tax" differences
are either considered temporary or permanent in nature. To the extent these
differences are permanent in nature (i.e. paydown reclasses and foreign
currency transactions), such amounts are reclassified within the
composition of net assets based on their federal tax-basis treatment;
temporary differences do not require reclassification.
Compensating Balances -- If a Fund has a cash overdraft in excess of
$100,000 it is required to leave 110% in compensating balance with SunTrust
Bank (the "Custodian"), a wholly owned subsidiary of SunTrust Banks, Inc.,
on the following day. If a Fund has a positive cash balance in excess of
$100,000 it is allowed to overdraw 90% of the balance with the Custodian on
the following business day. This does not apply to the International Equity
Fund.
3. Agreements and Other Transactions with Affiliates
Investment Advisory Agreement -- The Trust and Trusco Capital Management,
Inc. (the "Investment Adviser"), a wholly owned subsidiary of SunTrust
Banks, Inc., have entered into advisory agreements.
Under terms of the agreements, the Funds are charged the following annual
fees which are computed daily and paid monthly based upon average daily net
assets:
<Table>
<Caption>
Maximum
Annual Net Fees
Advisory Fee Paid
------------ --------
Capital Appreciation Fund.............. 1.15% 1.01%
Growth and Income Fund................. 0.90 0.90
International Equity Fund.............. 1.25 --
Mid-Cap Equity Fund.................... 1.15 0.89
Small Cap Value Equity Fund............ 1.15 1.02
Value Income Stock Fund................ 0.80 0.77
Investment Grade Bond Fund............. 0.74 0.50
</Table>
The Investment Adviser has contractually agreed to waive all or a portion
of its fees until 05/01/06.
Administration, Fund Accounting and Transfer Agency Agreement -- The Trust
and BISYS Fund Services Ohio, Inc. (the "Administrator") are parties to a
Master Services Agreement, under which the Administrator provides
administrative, fund accounting, and transfer agent services for an annual
fee (expressed as a percentage of the combined average daily net assets of
the Trust and STI Classic Funds) of: 0.0275% up to $25 billion, 0.0225% on
the next $5 billion and 0.0175% for over $30 billion plus an additional
class fee of $2,500 per class annum, applicable to each additional class of
shares over 145 classes of shares.
Per the executed Master Services Agreement, BISYS Fund Services Ohio, Inc.
has agreed to pay a total of $325,000 per annum towards the insurance
premiums payable annually by the Trust and the STI Classic Funds. $300,000
will be paid towards the premium for the Directors and Officers
Liability/Errors and Omissions Insurance Policy, and $25,000 will be paid
towards the premium for the Fidelity Bond Policy.
Distribution Services Agreement -- The Trust and BISYS Fund Services
Limited Partnership (the
36
NOTES TO FINANCIAL STATEMENTS (continued)
STI CLASSIC VARIABLE TRUST June 30, 2005
"Distributor") are parties to a Distribution Services Agreement. The
Distributor receives no fees for its services under this agreement.
Custodian Agreements -- SunTrust Bank acts as custodian for all the Funds
except the International Equity Fund, which utilizes Brown Brothers
Harriman & Co. as custodian. Custodians are paid on the basis of the net
assets and transaction costs of the Funds. The custodians play no role in
determining the investment policies of the Trust or which securities are to
be purchased or sold in the Funds.
Other -- Certain Officers of the Trust are also officers of the Adviser,
Administrator, and/or the Distributor. Such officers receive no fees from
the Trust for serving as officers of the Trust. Each of the nine trustees
are compensated $43,000 ($387,000 total) and the Chairman of the Board
receives $50,000 in meeting and retainer fees, plus the reimbursement for
certain expenses incurred. If the trustees take part in a Special
Telephonic Meeting, the Chairman receives $2,500 and each trustee receives
$2,000. Several trustees are also part of an Audit Committee and/or a
Governance and Nominating Committee. Each trustee that is part of one of
these committees receives a fee of $1,000 per meeting attended and the
Chairman of each Committee receives $1,500. Trusco Capital Management, Inc.
provides an employee to serve as Chief Compliance Officer for the Trust and
provide certain related services, and receives an annual fee for this
service of $120,000. In addition, BISYS provides an employee and staff to
serve as an assistant to the Chief Compliance Officer for the Trust,
including providing certain related services, and receives a fee for these
services of $150,000. Both fees are allocated across the assets of the
Trust and the STI Classic Funds. For the period ended June 30, 2005, the
total related amounts paid by the Trust were $2,243.
The Trust has entered into an agreement with SunTrust Robinson Humphrey, a
division of SunTrust Capital Markets, Inc. which is a direct non-bank
subsidiary of SunTrust Banks, Inc., to act as an agent in placing
repurchase agreements for the Trust. For the period ended June 30, 2005,
the following Funds paid SunTrust Robinson Humphrey, through a reduction in
the yield earned by the Funds on those repurchase agreements:
<Table>
<Caption>
Fees
----
Investment Grade Bond Fund............................. $82
</Table>
4. Investment Transactions
The cost of purchases and the proceeds from sales and maturities of securities,
excluding short-term investments and U.S. Government securities, for the period
ended June 30, 2005, were as follows (in thousands):
<Table>
<Caption>
Sales and
Purchases Maturities
--------- ----------
Capital Appreciation Fund..................... $24,842 $28,577
Growth and Income Fund........................ 2,939 2,896
International Equity Fund..................... 1,504 2,094
Mid-Cap Equity Fund........................... 7,645 9,684
Small Cap Value Equity Fund................... 5,048 4,415
Value Income Stock Fund....................... 24,220 4,359
Investment Grade Bond Fund.................... 2,717 2,482
</Table>
The cost of purchases and proceeds from sales and maturities of long-term U.S.
Government securities for the Investment Grade Bond Fund during the period ended
June 30, 2005, in thousands, was $14,178 and $16,189, respectively.
37
(Unaudited)
5. Federal Tax Policies and Information
It is the policy of each Fund to continue to qualify as a regulated investment
company by complying with the provisions available to certain investment
companies as defined in applicable sections of the Internal Revenue Code, and to
make distributions from net investment income and from net realized gains
sufficient to relieve it from all, or substantially all, federal income taxes.
Withholding taxes on foreign dividends have been paid or provided for in
accordance with applicable country's tax rule s and rates.
At June 30, 2005, the total cost of securities and the net realized gains or
losses on securities sold for Federal income tax purposes were different from
amounts reported for financial reporting purposes due to wash sales which cannot
be used for Federal income tax purposes in the current year and have been
deferred for use in future years. The Federal tax cost and aggregate gross
unrealized appreciation and depreciation for securities held by the Funds at
June 30, 2005, are presented on each Fund's Schedule of Portfolio Investments.
As of the latest tax year end of December 31, 2004, the following Funds had net
capital loss carryovers to offset future net capital gains, if any, to the
extent provided by the Treasury regulations. To the extent that these carryovers
are used to offset future gains, it is probable that the gains so offset will
not be distributed to shareholders (000):
<Table>
<Caption>
Expires
--------------------------------
Fund 2008 2009 2010 2011
- ---- ------ ---- ------- ------
Capital Appreciation Fund...... $ -- $ -- $ -- $ 66
Growth and Income Fund......... -- -- -- 250
International Equity Fund...... -- 843 1,471 497
Mid-Cap Equity Fund............ -- -- 2,515 --
Value Income Stock Fund........ 6,309 -- 3,046 2,432
Investment Grade Bond Fund..... -- 95 189 --
</Table>
Amounts designated as "-" are either $0 or have been rounded to $0.
6. Concentrations/Risks
The International Equity Fund invests in securities of foreign issuers in
various countries. These investments may involve certain considerations and
risks not typically associated with investments in the United States as a result
of, among other factors, the possibility of future political and economic
developments and the level of governmental supervision and regulation of
securities markets in the respective countries.
The prices of the Funds' fixed income securities respond to economic
developments, particularly interest rate changes, as well as to perceptions
about the creditworthiness of individual issuers, including governments.
Generally, the Funds' fixed income securities will decrease in value if interest
rates rise and vice versa, and the volatility of lower-rated securities is even
greater than that of higher-rated securities. Also, longer-term securities are
generally more volatile, so the average maturity or duration of these securities
affects risk.
Certain securities are backed by letters of credit from various financial
institutions and financial guaranty assurance agencies. These letters of credit
enhance the credit quality of the individual securities; however, if any of the
financial institutions or financial guaranty assurance agencies' credit quality
should deteriorate, it could cause the individual security's credit quality to
change. Additionally, if any of the Funds concentrate their letters of credit in
any one financial institution, the risk of credit quality deterioration
increases.
7. Securities Lending
Each Fund may lend portfolio securities to brokers, dealers and other financial
organizations that meet
38
NOTES TO FINANCIAL STATEMENTS (continued)
STI CLASSIC VARIABLE TRUST June 30, 2005
capital and other credit requirements or other criteria established by the
Trust's Board. These loans may not exceed either (i) 50% of the sum of the
market value of all securities of the Fund and the market value of the loan
collateral or (ii) 33.33% of the total market value of all securities of the
Fund. No Fund will lend portfolio securities to its investment adviser or its
affiliates unless it has applied for and received specific authority to do so
from the Securities and Exchange Commission. Loans of portfolio securities will
be fully collateralized by cash. The value of the collateral is at least 100% of
the market value of the securities loaned, or in the case of the Investment
Grade Bond Fund, the initial value of the collateral is at least 102% of the
market value of the securities loaned, and 100% thereafter. However, due to
market fluctuations during the day, the value of securities loaned on a
particular day may, during the course of the day, exceed the value of
collateral. On each business day, the amount of collateral is adjusted based on
the prior day's market fluctuations and the current day's lending activity.
Income from lending activity is determined by the amount of interest earned on
collateral, less any amounts payable to the borrowers of the securities and the
lending agent. Lending securities involves certain risks, including the risk
that the Fund may be delayed or prevented from recovering the collateral if the
borrower fails to return the securities.
Cash collateral received in connection with securities lending is invested in
the CSFB Enhanced Liquidity Portfolio (the "Portfolio"). This investment
consists of money market instruments including money market mutual funds
registered under the Investment Company Act of 1940, commercial paper,
repurchase agreements, U.S. Treasury Bills and U.S. agency obligations. At June
30, 2005, the Portfolio was invested in commercial paper, repurchase agreements,
asset backed securities, certificates of deposit and corporate bonds (with
interest rates ranging from 2.8225% to 3.59% and maturity dates ranging from
07/01/05 to 03/22/10).
The Funds paid fees for security lending for the period ended June 30, 2005,
which have been netted against the Security Lending Income on the Statements of
Operations. These fees are presented below:
<Table>
<Caption>
Fees
------
Capital Appreciation Fund.................................. $ 547
Growth and Income Fund..................................... 70
International Equity Fund.................................. 32
Mid-Cap Equity Fund........................................ 846
Small Cap Value Equity Fund................................ 176
Value Income Stock Fund.................................... 206
Investment Grade Bond Fund................................. 1,054
</Table>
8. Subsequent Events (Effective August 1, 2005)
The Growth and Income Fund changed its name to Large Cap Relative Value Fund and
the Value Income Stock Fund changed its name to Large Cap Value Equity Fund.
The Advisor has contractually agreed, until July 31, 2006, to waive fees and/or
reimburse each Fund to the extent necessary to maintain each Fund's Total
Operating Expenses as noted below:
<Table>
<Caption>
Total
Operating
Fund Expense
- ---- ---------
Capital Appreciation Fund.................. 1.12%
Large Cap Relative Value Fund
(formerly Growth and Income Fund)........ 1.00%
International Equity Fund.................. 1.30%
Mid-Cap Equity Fund........................ 1.15%
Small Cap Value Equity Fund................ 1.20%
Large Cap Value Equity Fund
(formerly Value Income Stock Fund)....... 0.95%
Investment Grade Bond Fund................. 0.65%
</Table>
39
(Unaudited)
The Funds have agreed to pay or repay fees that were waived or reimbursed for a
period up to three years after such waiver or reimbursement was made to the
extent such payments or repayments would not cause the expenses of the Fund to
exceed the above limits.
The Trust and the Advisor have entered into revised Advisory Agreements, under
which the Funds are charged the following annual fees based upon each Fund's
average daily net assets which are computed daily and paid monthly:
<Table>
<Caption>
Revised
Annual
Fund Advisory Fee
- ---- ------------
Capital Appreciation Fund.................. 0.97%
Large Cap Relative Value Fund
(formerly Growth and Income Fund)........ 0.85%
International Equity Fund.................. 1.15%
Mid-Cap Equity Fund........................ 1.00%
Small Cap Value Equity Fund................ 1.15%
Large Cap Value Equity Fund
(formerly Value Income Stock Fund)....... 0.80%
Investment Grade Bond Fund................. 0.50%
</Table>
Breakpoints will be used in computing the advisory fee. The full fee will be
charged on average daily net assets of each Fund up to $500 million, a discount
of 5% on the next $500 million, and a discount of 10% over $1 billion.
40
TRUSTEES AND OFFICERS OF THE STI CLASSIC VARIABLE TRUST (UNAUDITED)
Information pertaining to the trustees of the Trust is set forth below. Trustees
who are not deemed to be "interested persons" of the Trust as defined in the
1940 Act are referred to as "Independent Board Members." Trustees who are deemed
to be "interested persons" of the Trust are referred to as "Interested Board
Members." Messrs. Courts and Ridley are Trustees who may be deemed to be
"interested persons" of the Trust.
- --------------------------------------------------------------------------------
<Table>
<Caption>
NUMBER OF
PORTFOLIOS IN
TERM OF PRINCIPAL THE STI
POSITION(S) OFFICE AND OCCUPATION(S) FUND COMPLEX OTHER
NAME, ADDRESS, HELD WITH LENGTH OF DURING THE OVERSEEN BY DIRECTORSHIPS
DATE OF BIRTH THE GROUP TIME SERVED PAST 5 YEARS TRUSTEE HELD BY TRUSTEE
- -------------------------------------------------------------------------------------------------------------------------------
INTERESTED
TRUSTEES*:
Richard W. Courts, II Trustee Indefinite; Chairman, Atlantic 60 Cousins Properties, Inc.;
3435 Stelzer Road since November Investment Company Genuine Parts Company;
Columbus, OH 43219 2001 Piedmont Medical Center;
DOB 01/18/36 SunTrust Bank; Courts
Foundation; J. Bulow
Campbell Foundation
- -------------------------------------------------------------------------------------------------------------------------------
Clarence H. Ridley Trustee Indefinite; Chairman, Haverty 60 Crawford & Co.
3435 Stelzer Road since November Furniture Companies;
Columbus, OH 43219 2001 Partner, King and
DOB 06/03/42 Spaulding LLP (law
firm) (1977 to 2000)
- -------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT
TRUSTEES:
Thomas Gallagher Trustee Indefinite; President, CEO, Genuine 60 NAPA; Genuine Parts Company;
3435 Stelzer Road since May 2000 Parts Company Stone Mountain Industrial
Columbus, OH 43219 Park; The Lovett School;
DOB 11/25/47 Oxford Industries Inc.
- -------------------------------------------------------------------------------------------------------------------------------
F. Wendell Gooch Trustee Indefinite; Retired 60 SEI Family of Funds
3435 Stelzer Road since May 1992
Columbus, OH 43219
DOB 12/03/32
- -------------------------------------------------------------------------------------------------------------------------------
Connie D. McDaniel Trustee Indefinite; Vice President and 60 None
3435 Stelzer Road since May 2005 Controller, The Coca-
Columbus, OH 43219 Cola Company
DOB 04/10/58
- -------------------------------------------------------------------------------------------------------------------------------
James O. Robbins Trustee Indefinite; President, CEO, Cox 60 Cox Communications; National
3435 Stelzer Road since May 2000 Communications, Inc. Cable and Telecommunications
Columbus, OH 43219 Association; Discovery
DOB 07/04/42 Channel; Cable Labs; C-SPAN;
St. Paul's School
- -------------------------------------------------------------------------------------------------------------------------------
Jonathan T. Walton Trustee Indefinite; Retired 60 Detroit Riverfront
3435 Stelzer Road since February Conservancy
Columbus, OH 43219 1998
DOB 03/28/30
- -------------------------------------------------------------------------------------------------------------------------------
Sidney E. Harris Trustee Indefinite; Professor (since 2004), 60 ServiceMaster Company; Total
3435 Stelzer Road since November Dean (1997-2004), J. System Services, Inc.;
Columbus, OH 43219 2004 Mack Robinson College Transamerica Investors, Inc.
DOB 07/21/49 of Business, Georgia (13 Mutual Funds)
State University
- -------------------------------------------------------------------------------------------------------------------------------
</Table>
41
<Table>
<Caption>
NUMBER OF
PORTFOLIOS IN
TERM OF PRINCIPAL THE STI
POSITION(S) OFFICE AND OCCUPATION(S) FUND COMPLEX OTHER
NAME, ADDRESS, HELD WITH LENGTH OF DURING THE OVERSEEN BY DIRECTORSHIPS
DATE OF BIRTH THE GROUP TIME SERVED PAST 5 YEARS TRUSTEE HELD BY TRUSTEE
- -------------------------------------------------------------------------------------------------------------------------------
Warren Y. Jobe Trustee Indefinite; Retired. EVP, Georgia 60 WellPoint, Inc.; UniSource
3435 Stelzer Road since November Power Company and SVP, Energy Corp.; HomeBanc Corp.
Columbus, OH 43219 2004 Southern Company
DOB 11/12/40 (1998-2001)
- -------------------------------------------------------------------------------------------------------------------------------
Charles D. Winslow Trustee Indefinite; Retired. Formerly 60 None
3435 Stelzer Road since November Partner, Accenture
Columbus, OH 43219 2004 (consulting)
DOB 07/13/35
</Table>
* Mr. Courts may be deemed an interested Trustee because of his directorships
with affiliates of the Adviser. Mr. Ridley may be deemed an interested Trustee
because of a material business relationship with the parent of the Adviser.
<Table>
<Caption>
TERM OF PRINCIPAL
POSITION(S) OFFICE AND OCCUPATION(S)
NAME, ADDRESS, HELD WITH LENGTH OF DURING THE
DATE OF BIRTH THE GROUP TIME SERVED PAST 5 YEARS
- ----------------------------------------------------------------------------------------------------------------------------
OFFICERS:
R. Jeffrey Young President One-year; since Senior Vice President, Relationship Management, BISYS Fund
3435 Stelzer Road July 2004 Services (since 2002); Vice President, Client Services,
Columbus, OH 43219 BISYS Fund Services; (1997-2002)
DOB 08/22/64
- ----------------------------------------------------------------------------------------------------------------------------
Deborah A. Lamb Executive Vice One-year; since) Chief Compliance Officer and Executive Vice President, STI
50 Hurt Plaza President; September 2004; Classic Funds and Variable Trust (2004-present); Chief
Suite 1400 Assistant since November Compliance Officer, Managing Director, Trusco Capital
Chief DOB 10/02/52 Secretary; 2003; since Management, Inc. (2003-2005); President, Investment Industry
Chief August 2004 Consultants, LLC (since 2000); Director of Compliance,
Compliance (respectively INVESCO, Inc. (1995-2000)
Officer
- ----------------------------------------------------------------------------------------------------------------------------
David L. Hughes Treasurer, One-year; since Vice President, Financial Administration, BISYS Fund
3435 Stelzer Road Chief Financial May 2005 Services (since 2005); Assistant Vice President, Evergreen
Columbus, OH 43219 Officer Investments from 2000 to 2004; Fund Accounting Manager,
DOB 01/23/65 Fidelity Investments from 1998 to 2000
- ----------------------------------------------------------------------------------------------------------------------------
Cynthia J. Surprise Secretary One-year; since Senior Counsel, Legal Services, BISYS Fund Services (since
3435 Stelzer Road February 2005 2004); Director and Counsel, Investors Bank & Trust Company
Columbus, OH 43219 (1999- 2004)
DOB 07/08/46
- ----------------------------------------------------------------------------------------------------------------------------
Alaina V. Metz Assistant One-year; since Vice President, Blue Sky Compliance, BISYS Fund Services
3435 Stelzer Road Secretary July 2004 (since 2002); Chief Administrative Officer, Blue Sky
Columbus, OH 43219 Compliance, BISYS Fund Services (1995-2002)
DOB 04/07/67
</Table>
42
SPECIAL MEETING OF SHAREHOLDERS (UNAUDITED)
A special meeting of the shareholders of STI Classic Variable Trust (the
"Trust") was held on November 15, 2004. At the meeting shareholders voted and
approved the following proposal:
Proposal 1: To consider and vote on the election of members to the Board
of Trustees of the Trust.
The results of this meeting are presented below:
<Table>
<Caption>
RICHARD W. COURTS, II
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,643,079,484.413 57.607% 99.775%
Withhold................................ 19,527,110.520 .130% .225%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
<Table>
<Caption>
THOMAS C. GALLAGHER
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,647,093,895.243 57.634% 99.821%
Withhold................................ 15,512,699.690 .103% .179%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
<Table>
<Caption>
F. WENDELL GOOCH
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,646,942,792.353 57.632% 99.819%
Withhold................................ 15,663,802.580 .105% .181%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
<Table>
<Caption>
SIDNEY E. HARRIS
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,643,726,038.293 57.611% 99.782%
Withhold................................ 18,880,556.640 .126% .218%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
<Table>
<Caption>
WARREN Y. JOBE
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,643,699,091.683 57.611% 99.782%
Withhold................................ 18,907,503.250 .126% .218%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
43
<Table>
<Caption>
CLARENCE H. RIDLEY
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,643,065,943.353 57.607% 99.774%
Withhold................................ 19,540,651.580 .130% .226%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
<Table>
<Caption>
JAMES O. ROBBINS
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,643,422,544.023 57.609% 99.779%
Withhold................................ 19,184,050.910 .128% .221%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
<Table>
<Caption>
JONATHAN T. WALTON
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,647,114,982.373 57.634% 99.821%
Withhold................................ 15,491,612.560 .103% .179%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
<Table>
<Caption>
CHARLES D. WINSLOW
- -----------------------------------------------------------------------------------------------------------
# OF SHARES % OF OUTSTANDING SHARES % OF SHARES PRESENT
----------------- ----------------------- -------------------
Affirmative............................. 8,643,530,202.353 57.610% 99.780%
Withhold................................ 19,076,392.580 .127% .220%
Total................................... 8,662,606,594.933 57.737% 100.000%
</Table>
44
ADDITIONAL INFORMATION (UNAUDITED)
ANNUAL APPROVAL OF INVESTMENT ADVISORY AGREEMENTS
The continuance of the Trust's investment advisory agreements with Trusco
Capital Management, Inc. (the "Adviser") must be specifically approved at least
annually (i) by the vote of the Trustees or by a vote of the shareholders of the
Funds and (ii) by the vote of a majority of the Trustees who are not parties to
the agreements or "interested persons" of any party thereto, as defined in the
Investment Company Act 1940, cast in person at a meeting called for the purpose
of voting on such approval. Each year, the Board of Trustees calls and holds a
meeting to decide whether to renew the Trust's agreements for the upcoming year.
In preparation for the meeting, the Board requests and reviews a wide variety of
information from the Adviser. The Trustees use this information, as well as
other information that the Adviser and other service providers may submit to the
Board, to help them decide whether to renew the agreements for another year.
In considering the renewal of the agreements this year, the Board requested and
received material from the Adviser in preparation for a special meeting of the
Board held on April 25, 2005, and requested and reviewed additional material
from the Adviser in preparation for its quarterly meeting held on May 17, 2005,
at which it specifically considered the renewal of the agreements. Such material
included, among other things, information about: (a) the quality of the
Adviser's investment management and other services; (b) the Adviser's investment
management personnel; (c) the Adviser's operations and financial condition; (d)
the Adviser's brokerage practices (including any soft dollar arrangements) and
investment strategies; (e) the level of the advisory fees that the Adviser
charges the Funds compared with the fees it charges to comparable mutual funds
or accounts; (f) the Funds' overall fees and operating expenses compared with
similar mutual funds; (g) the level of the Adviser's profitability from its
Fund-related operations; (h) the Adviser's compliance systems; (i) the Adviser's
policies and procedures for personal securities transactions; (j) the Adviser's
reputation, expertise and resources in domestic financial markets; and (k) the
Funds' performance compared with similar mutual funds. At both meetings,
representatives from the Adviser presented additional oral and written
information to the Board to help the Board evaluate the Adviser's fees and other
aspects of the agreements.
Of particular focus at the meetings was the Adviser's proposed reduction in
advisory fees for several of the Funds and the proposed introduction of
breakpoints into the fee schedules to ensure continued reduction in advisory
fees as the Funds experience economies of scale. The Board considered the
Adviser's stated goals, which are to meet regulatory guidelines, increase
marketability, reduce shareholder expenses, and enhance performance. The Board
reviewed a presentation regarding the current and proposed fees compared to the
Lipper median advisory fees. The Board noted that, while the proposed fee
structure would help to bring the Funds' advisory fees more in line with the
Lipper medians, the Funds will become more competitive as asset levels increase.
In addition, the Board focused on the performance of the Funds, including any
periods of outperformance or underperformance compared to relevant benchmarks
and Lipper peer group categories. In evaluating performance, the Board received
and reviewed information regarding the composition of the peer group and
selection criteria, as well as market risk and shareholder risk expectations for
each Fund. The Board considered all of the information provided by the Adviser
45
regarding the Funds' performance and noted the Adviser's explanation regarding
performance issues resulting from the current investment environment.
Based on the Board's deliberations and its evaluation of the information
described above, the Board, including all of the independent Trustees,
unanimously: (a) concluded that terms of the agreements are fair and reasonable;
(b) concluded that the Adviser's fees are reasonable in light of the services
that the Adviser provides to the Trust; and (c) agreed to renew the agreements
for another year.
The Board made these determinations on the basis of the following
considerations, among others:
- - The agreements reflect a decrease in the advisory fees for several of the
Funds, did not increase the advisory fees for the remaining Funds and, in
combination with contractual expense caps for the Funds, result in an overall
decrease in expense levels.
- - The advisory fees payable to the Adviser under the agreements are fair and
reasonable in light of the services to be provided, the anticipated costs of
these services, the profitability of the Adviser's relationship with each
Fund, as well as the profitability of other asset management companies, and
the comparability of the proposed fees to those paid by comparable mutual
funds.
- - The nature, quality and extent of the investment advisory services provided by
the Adviser, in light of the high quality services provided to the other
mutual funds advised by the Adviser and their historic performance. The
Board's opinion was also based on the periodic reports it receives from the
Adviser regarding adherence to investment policies and restrictions, policies
on personal securities transactions, and compliance policies and procedures
generally.
- - The performance of each Fund relative to its peer group and appropriate
indices/benchmarks and in light of total return, yield, and market trends.
- - The Adviser's representations regarding its staffing and capabilities to
manage the Funds, including the retention of personnel with significant
portfolio management experience.
- - The nature, quality and extent of the administrative and other non-investment
management services provided to the Funds by the Adviser.
- - The Adviser's entrepreneurial commitment to the management and success of each
Fund, which could entail a substantial commitment of resources to the
successful operation of each Fund.
- - The overall quality of the personnel, operations, financial condition,
investment management capabilities, methodologies, and performance of the
Adviser.
46
ADDITIONAL INFORMATION (continued)
Expense Examples
As a Fund shareholder, you incur two types of costs: (1) transaction costs, and
(2) ongoing costs, including management fees and other fund expenses. This
example is intended to help you understand your ongoing costs (in dollars) of
investing in a Fund and to compare these costs with the ongoing costs of
investing in other mutual funds. Please note that separate account and contract
expenses, fees, and charges are not reflected.
These examples are based on an investment of $1,000 invested at the beginning of
the period and held for the entire period from January 1, 2005 through June 30,
2005.
Actual Expenses
The table below provides information about actual account values and actual
expenses. You may use the information below, 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 table under the
heading entitled "Expenses Paid During Period" to estimate the expenses you paid
on your account during this period.
<Table>
<Caption>
Beginning Ending Expense Paid Expense Ratio
Account Value Account Value During Period* During Period**
01/01/05 6/30/05 01/01/05-6/30/05 01/01/05-6/30/05
------------- ------------- ---------------- ----------------
Capital Appreciation Fund................................ $1,000.00 $ 954.80 $5.57 1.15%
Growth and Income Fund................................... 1,000.00 1,027.80 5.78 1.15%
International Equity Fund................................ 1,000.00 977.40 7.75 1.58%
Mid-Cap Equity Fund...................................... 1,000.00 1,063.50 5.88 1.15%
Small Cap Value Equity Fund.............................. 1,000.00 992.60 5.98 1.21%
Value Income Stock Fund.................................. 1,000.00 993.10 4.60 0.93%
Investment Grade Bond Fund............................... 1,000.00 1,026.30 3.77 0.75%
</Table>
- ---------------
* Expenses are equal to the average account value times the Fund's annualized
expense ratio multiplied by the number of days in the most recent fiscal
half-year divided by the number of days in the fiscal year.
** Annualized.
Hypothetical Example
The table below provides information about hypothetical account values and
hypothetical expenses based on a Fund's 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 this 5% hypothetical example with the 5%
hypothetical examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs. Therefore, 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
transactional costs were included, your costs would have been higher.
47
<Table>
<Caption>
Beginning Ending Expense Paid Expense Ratio
Account Value Account Value During Period* During Period**
01/01/05 6/30/05 01/01/05-6/30/05 01/01/05-6/30/05
------------- ------------- ---------------- ----------------
Capital Appreciation Fund................................ $1,000.00 $1,019.09 $5.76 1.15%
Growth and Income Fund................................... 1,000.00 1,019.09 5.76 1.15%
International Equity Fund................................ 1,000.00 1,016.96 7.90 1.58%
Mid-Cap Equity Fund...................................... 1,000.00 1,019.09 5.76 1.15%
Small Cap Value Equity Fund.............................. 1,000.00 1,018.79 6.06 1.21%
Value Income Stock Fund.................................. 1,000.00 1,020.18 4.66 0.93%
Investment Grade Bond Fund............................... 1,000.00 1,021.08 3.76 0.75%
</Table>
- ---------------
* Expenses are equal to the average account value times the Fund's annualized
expense ratio multiplied by the number of days in the most recent fiscal
half-year divided by the number of days in the fiscal year.
** Annualized.
PROXY VOTING
Information regarding the policies and procedures that the Funds use to
determine how to vote proxies relating to portfolio securities is available
without charge, upon request, by calling 1-800-428-6970. The information also is
included in the Funds' Statement of Additional Information, which is available
on the Funds' website at www.sticlassicfunds.com and on the Securities and
Exchange Commission's website at www.sec.gov.
Information relating to how each Fund voted proxies relating to portfolio
securities held during the most recent twelve months ended June 30 is available
on the Funds' website at www.sticlassicfunds.com and on the Securities and
Exchange Commission's website at www.sec.gov.
PORTFOLIO HOLDINGS INFORMATION
The Funds file a complete list of their portfolio holdings with the Securities
and Exchange Commission for the first and third quarters of each fiscal year on
Form N-Q. Forms N-Q are available free of charge on the Securities and Exchange
Commission's website at www.sec.gov. You may also review, or for a fee, copy
those documents by visiting the Securities and Exchange Commission's Public
Reference Room in Washington, D.C. Information on the operation of the Public
Reference Room may be obtained by calling the Securities and Exchange Commission
at 1-800-SEC-0330.
48
INVESTMENT ADVISER:
Trusco Capital Management, Inc.
STI Classic Variable Trust Funds are not deposits,
are not insured or guaranteed by the FDIC or any
other government agency, and are not endorsed by
and do not constitute obligations of SunTrust Banks,
Inc. or any other of its affiliates. Investment in
the Funds involves risk, including the possible loss
of principal. There is no guarantee that any STI
Classic Variable Trust Fund will achieve its investment
objective. The STI Classic Variable Trust Funds are
advised by Trusco Capital Management, Inc.
DISTRIBUTOR:
BISYS Fund Services Limited Partnership
This information must be preceded or accompanied
by a current prospectus for each Fund described.
STI-SR-VT-0605 08/05
ITEM 2. CODE OF ETHICS.
Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the registrant or a
third party. If the registrant has not adopted such a code of ethics,
explain why it has not done so.
NOT APPLICABLE - ONLY FOR ANNUAL REPORTS.
The registrant must briefly describe the nature of any amendment, during
the period covered by the report, to a provision of its code of ethics that
applies to the registrant's principal executive officer, principal
financial officer, principal accounting officer or controller, or persons
performing similar functions, regardless of whether these individuals are
employed by the registrant or a third party, and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of
this Item. The registrant must file a copy of any such amendment as an
exhibit pursuant to Item 12(a)(1), unless the registrant has elected to
satisfy paragraph (f) of this Item by posting its code of ethics on its
website pursuant to paragraph (f)(2) of this Item, or by undertaking to
provide its code of ethics to any person without charge, upon request,
pursuant to paragraph (f)(3) of this Item.
If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of
ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller, or
persons performing similar functions, regardless of whether these
individuals are employed by the registrant or a third party, that relates
to one or more items set forth in paragraph (b) of this Item, the
registrant must briefly describe the nature of the waiver, the name of the
person to whom the waiver was granted, and the date of the waiver.
NOT APPLICABLE - ONLY FOR ANNUAL REPORTS.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of directors has
determined that the registrant either:
(i) Has at least one audit committee financial expert
serving on its audit committee; or
(ii) Does not have an audit committee financial expert serving
on its audit committee.
(2) If the registrant provides the disclosure required by
paragraph (a)(1)(i) of this Item, it must disclose the name of the
audit committee financial expert and whether that person is
"independent." In order to be considered "independent" for
purposes of this Item, a member of an audit committee may not,
other than in his or her capacity as a member of the audit
committee, the board of directors, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or
other compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as
defined in Section 2(a)(19) of the Act (15 U.S.C. 80a-
2(a)(19)).
(3) If the registrant provides the disclosure required by
paragraph (a)(1)(ii) of this Item, it must explain why it does not
have an audit committee financial expert.
NOT APPLICABLE - ONLY FOR ANNUAL REPORTS.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption Audit Fees, the aggregate fees billed
for each of the last two fiscal years for professional services rendered by the
principal accountant for the audit of the registrant's annual financial
statements or services that are normally provided by the accountant in
connection with statutory and regulatory filings or engagements for those fiscal
years.
(b) Disclose, under the caption Audit-Related Fees, the aggregate fees
billed in each of the last two fiscal years for assurance and related services
by the principal accountant that are reasonably related to the performance of
the audit of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
(c) Disclose, under the caption Tax Fees, the aggregate fees billed in
each of the last two fiscal years for professional services rendered by the
principal accountant for tax compliance, tax advice, and tax planning.
Registrants shall describe the nature of the services comprising the fees
disclosed under this category.
(d) Disclose, under the caption All Other Fees, the aggregate fees
billed in each of the last two fiscal years for products and services provided
by the principal accountant, other than the services reported in paragraphs (a)
through (c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
(e) (1) Disclose the audit committee's pre-approval policies and
procedures described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
(2) Disclose the percentage of services described in each of
paragraphs (b) through (d) of this Item that were approved by the audit
committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) If greater than 50 percent, disclose the percentage of hours
expended on the principal accountant's engagement to audit the registrant's
financial statements for the most recent fiscal year that were attributed to
work performed by persons other than the principal accountant's full-time,
permanent employees.
(g) Disclose the aggregate non-audit fees billed by the registrant's
accountant for services rendered to the registrant, and rendered to the
registrant's investment adviser (not including any sub-adviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the adviser that provides ongoing services to the registrant for
each of the last two fiscal years of the registrant.
(h) Disclose whether the registrant's audit committee of the board of
directors has considered whether the provision of nonaudit services that were
rendered to the registrant's investment adviser (not including any subadviser
whose role is primarily portfolio management and is subcontracted with or
overseen by another investment adviser), and any entity controlling, controlled
by, or under common control with the investment adviser that provides ongoing
services to the registrant that were not pre-approved pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the
principal accountant's independence.
NOT APPLICABLE - ONLY FOR ANNUAL REPORTS.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
(a) If the registrant is a listed issuer as defined in Rule 10A-3
under the Exchange Act (17CFR 240.10A-3), state whether or not the
registrant has a separately-designated standing audit committee
established in accordance with Section 3(a)(58)(A) of the Exchange
Act (15 U.S.C. 78c(a)(58)(A)). If the registrant has such a
committee, however designated, identify each committee member. If
the entire board of directors is acting as the registrant's audit
committee as specified in Section 3(a)(58)(B) of the Exchange Act
(15 U.S.C. 78c(a)(58)(B)), so state.
(b) If applicable, provide the disclosure required by Rule 10A-3(d)
under the Exchange Act (17CFR 240.10A-3(d)) regarding an exemption
from the listing standards for all audit committees.
NOT APPLICABLE.
ITEM 6. SCHEDULE OF INVESTMENTS.
File Schedule I - Investments in securities of unaffiliated issuers as of the
close of the reporting period as set forth in ss. 210.12-12 of Regulation S-X,
unless the schedule is included as part of the report to shareholders filed
under Item 1 of this Form.
NOT APPLICABLE. INCLUDED IN ITEM 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual
report on this Form N-CSR must, unless it invests exclusively in non-voting
securities, describe the policies and procedures that it uses to determine how
to vote proxies relating to portfolio securities, including the procedures that
the company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
NOT APPLICABLE.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
If the registrant is a closed-end management investment company that is filing
an annual report on this Form N-CSR, provide the information specified in
paragraphs (a) and (b) of this Item with respect to portfolio managers.
NOT APPLICABLE.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
If the registrant is a closed-end management investment company, provide the
information specified in paragraph (b) of this Item with respect to any purchase
made by or on behalf of the registrant or any "affiliated purchaser," as defined
in Rule 10b-18(a)(3) under the Exchange Act (17 CFR 240.10b-18(a)(3)), of shares
or other units of any class of the registrant's equity securities that is
registered by the registrant pursuant to Section 12 of the Exchange Act (15
U.S.C. 781).
NOT APPLICABLE.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Describe any material changes to the procedures by which shareholders may
recommend nominees to the registrant's board of directors, where those changes
were implemented after the registrant last provided disclosure in response to
the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR 240.14a-101), or
this Item.
NOT APPLICABLE.
For purposes of this Item, adoption of procedures by which shareholders may
recommend nominees to the registrant's board of directors, where the
registrant's most recent proxy disclosure (in response to the requirements of
Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR 240.14a-101)), or this Item,
indicated that the registrant did not have in place such procedures, will
constitute a material change.}
ITEM 11. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive
and principal financial officers, or persons performing similar functions,
regarding the effectiveness of the registrant's disclosure controls and
procedures (as defined in Rule 30a-3(c) under the Act (17 CFR 270.30a-3(c))) as
of a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph, based on the evaluation of these controls
and procedures required by Rule 30a-3(b) under the Act (17 CFR 270.30a-3(b)) and
Rules 13a-15(b) or 15d-15(b) under the Exchange Act (17 CFR 240.13a-15(b) or
240.15d-15(b)).
THE REGISTRANT'S PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER
HAVE CONCLUDED, BASED ON THEIR EVALUATION OF THE REGISTRANT'S DISCLOSURE
CONTROLS AND PROCEDURES AS CONDUCTED WITHIN 90 DAYS OF THE FILING DATE OF THIS
REPORT, THAT THESE DISCLOSURE CONTROLS AND PROCEDURES ARE ADEQUATELY DESIGNED
AND ARE OPERATING EFFECTIVELY TO ENSURE THAT INFORMATION REQUIRED TO BE
DISCLOSED BY THE REGISTRANT ON FORM N-CSR IS RECORDED, PROCESSED, SUMMARIZED AND
REPORTED WITHIN THE TIME PERIODS SPECIFIED IN THE SECURITIES AND EXCHANGE
COMMISSION'S RULES AND FORMS.
(b) Disclose any change in the registrant's internal control over financial
reporting (as defined in Rule 30a-3(d) under the Act (17 CFR 270.30a-3(d)) that
occurred during the second fiscal quarter of the period covered by this report
that has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
THERE WERE NO CHANGES IN THE REGISTRANT'S INTERNAL CONTROL OVER FINANCIAL
REPORTING THAT OCCURRED DURING THE SECOND FISCAL QUARTER OF THE PERIOD COVERED
BY THIS REPORT THAT HAVE MATERIALLY AFFECTED OR ARE REASONABLY LIKELY TO
MATERIALLY AFFECT, THE REGISTRANT'S INTERNAL CONTROL OVER FINANCIAL REPORTING.
ITEM 12. EXHIBITS.
(a) File the exhibits listed below as part of this Form. Letter or
number the exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of
the disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit. NOT APPLICABLE -
ONLY EFFECTIVE FOR ANNUAL REPORTS.
(a)(2) A separate certification for each principal executive officer
and principal financial officer of the registrant as required by Rule 30a-2(a)
under the Act (17 CFR 270.30a-2). CERTIFICATIONS PURSUANT TO RULE 30A-2(a) ARE
ATTACHED HERETO.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1
under the Act (17 CFR 270.23c-1) sent or given during the period covered by the
report by or on behalf of the registrant to 10 or more persons. NOT APPLICABLE.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange
Act, provide the certifications required by rule 30a-2(b) under the Act as an
exhibit. A certification furnished pursuant to this paragraph will not be deemed
"filed" for purposes of Section 18 of the Exchange Act, or otherwise subject to
the liability of that section. Such certification will not be deemed to be
incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant incorporates it by reference.
CERTIFICATIONS PURSUANT TO RULE 30A-2(B) ARE FURNISHED HEREWITH.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) STI Classic Variable Trust
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By (Signature and Title)* /s/ David L. Hughes David L. Hughes, Treasurer
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Date September 2, 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 (Signature and Title)* /s/ David L. Hughes David L. Hughes, Treasurer
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Date September 2, 2005
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By (Signature and Title)* /s/ R. Jeffrey Young R. Jeffrey Young, President
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Date September 2, 2005
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* Print the name and title of each signing officer by his or her signature.