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: 811-07266
---------------------------------------------
Principal Equity Income Fund, Inc.
(previously Principal Utilities Fund, Inc.)
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(Exact name of registrant as specified in charter)
711 High Street Des Moines, IA 50392-2080
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(Address of principal executive offices) (Zip code)
Princor Financial Services Corporation Des Moines, IA 50392-2080
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(Name and address of agent for service)
Registrant's telephone number, including area code: 515 247-5476
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Date of fiscal year end: October 31, 2004
----------------------------------
Date of reporting period: April 30, 2004
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Item 1. Report to Shareholders.
TABLE OF CONTENTS
PAGE
Financial Statements and Highlights
Statements of Assets and Liabilities................................... 2
Statements of Operations............................................... 13
Statements of Changes in Net Assets.................................... 24
Notes to Financial Statements.......................................... 35
Schedules of Investments
Balanced Fund.........................................................46
Bond Fund.............................................................65
Capital Value Fund....................................................75
Cash Management Fund..................................................78
Equity Income Fund....................................................81
Government Securities Income Fund.....................................84
Growth Fund...........................................................85
International Emerging Markets Fund...................................87
International Fund....................................................90
International SmallCap Fund...........................................93
LargeCap Stock Index Fund.............................................97
Limited Term Bond Fund................................................106
MidCap Fund...........................................................114
Partners Blue Chip Fund...............................................118
Partners Equity Growth Fund...........................................122
Partners LargeCap Blend Fund..........................................124
Partners LargeCap Value Fund..........................................130
Partners MidCap Growth Fund...........................................133
Partners SmallCap Growth Fund.........................................136
Real Estate Securities Fund...........................................138
SmallCap Fund.........................................................139
Tax-Exempt Bond Fund..................................................142
Financial Highlights...................................................145
Fund Directors..........................................................167
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
BALANCED BOND
FUND, INC. FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ..... $105,768,819 $235,360,554
============ ============
ASSETS
Investment in securities--at value..... $106,483,772/(c)/ $236,763,059/(c)/
Cash................................... 80,266 3,284,595
Receivables:
Capital Shares sold................... 1,175 11,521
Dividends and interest................ 444,829 2,203,004
Investment securities sold............ 133,876 1,399,607
Other assets........................... 5,311 8,429
Prepaid directors' expenses............ 1,162 1,715
------------ ------------
Total Assets 107,150,391 243,671,930
LIABILITIES
Accrued management and investment
advisory fees......................... 10,065 16,493
Accrued distribution fees.............. 5,927 13,644
Accrued transfer and administrative
fees.................................. 92,520 132,520
Accrued other expenses................. 34,327 27,592
Payables:
Capital Shares reacquired............. 86,086 84,308
Investment securities purchased....... 5,900,676 29,672,535
Unrealized loss on swap agreements.... -- 297,832
Collateral obligation on securities
loaned, at value...................... 548,638 395,638
------------ ------------
Total Liabilities 6,678,239 30,640,562
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................... $100,472,152 $213,031,368
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital....................... $112,872,520 $223,113,950
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............... 19,870 (410,075)
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................ (13,135,191) (10,777,180)
Net unrealized appreciation
(depreciation) of investments......... 714,953 1,104,673
------------ ------------
Total Net Assets $100,472,152 $213,031,368
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized...................... 100,000,000 200,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................... $ 85,040,978 $180,605,344
Shares issued and outstanding........ 6,944,561 16,563,178
Net asset value per share............ $ 12.25 $ 10.90
Maximum offering price per share
/(a)/ ................................ $ 13.00 $ 11.44
============ ============
Class B: Net Assets.................... $ 15,431,174 $ 32,426,024
Shares issued and outstanding........ 1,266,180 2,977,712
Net asset value per share /(b)/ ..... $ 12.19 $ 10.89
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value for
Principal / /Balanced Fund, Inc. and 4.75% of the offering price or 4.99% of
the net asset value for Principal Bond Fund, Inc./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
2
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
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PRINCIPAL PRINCIPAL
CAPITAL VALUE CASH MANAGEMENT
FUND, INC. FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ....... $336,373,661 $ 326,144,663
============ ==============
ASSETS
Investment in securities--at value....... $356,271,178/(c)/ $ 326,144,663
Cash..................................... 9,032 1,588
Receivables:
Capital Shares sold..................... 3,185 650
Dividends and interest.................. 321,694 427,511
Expense reimbursement from Manager...... -- 47
Investment securities sold.............. 130,418 --
Other assets............................. 30,542 28,548
Prepaid directors' expenses.............. 3,732 460
------------ --------------
Total Assets 356,769,781 326,603,467
LIABILITIES
Accrued management and investment
advisory fees........................... 34,829 23,664
Accrued distribution fees................ 11,761 201
Accrued transfer and administrative fees. 204,957 230,494
Accrued other expenses................... 27,297 28,455
Payables:
Capital Shares reacquired............... 104,444 1,200,808
Variation margin on futures contracts... 14,800 --
Collateral obligation on securities
loaned, at value........................ 1,501,000 --
------------ --------------
Total Liabilities 1,899,088 1,483,622
------------ --------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ................................. $354,870,693 $ 325,119,845
============ ==============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital......................... $347,728,421 $ 325,119,845
Accumulated undistributed
(overdistributed) net investment income
(operating loss)........................ 896,231 --
Accumulated undistributed
(overdistributed) net realized gain
(loss).................................. (13,620,676) --
Net unrealized appreciation
(depreciation) of investments........... 19,866,717 --
------------ --------------
Total Net Assets $354,870,693 $ 325,119,845
============ ==============
CAPITAL STOCK (PAR VALUE: $.01 A SHARE):
Shares authorized........................ 100,000,000 2,000,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets...................... $326,569,610 $ 319,419,287
Shares issued and outstanding.......... 14,264,293 319,419,287
Net asset value per share.............. $ 22.89 $ 1.000
Maximum offering price per share /(a)/ $ 24.29 $ 1.000
============ ==============
Class B: Net Assets...................... $ 28,301,083 $ 5,700,558
Shares issued and outstanding.......... 1,245,788 5,700,558
Net asset value per share /(b)/ ....... $ 22.72 $ 1.000
============ ==============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value for
Principal / /Capital Value Fund, Inc. No sales charge applies to Principal
Cash Management Fund, Inc./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
3
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
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PRINCIPAL PRINCIPAL
EQUITY INCOME GOVERNMENT SECURITIES
FUND, INC. INCOME FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ..... $ 73,596,325 $352,336,716
============ ============
ASSETS
Investment in securities--at value..... $ 70,336,595 $351,727,341/(c)/
Cash................................... 829,281 2,408,693
Receivables:
Capital Shares sold................... 135,272 253,532
Dividends and interest................ 296,019 1,487,926
Expense reimbursement from Manager.... 90 --
Investment securities sold............ 1,580,161 --
Other assets........................... 1,817 21,440
Prepaid directors' expenses............ 631 2,287
------------ ------------
Total Assets 73,179,866 355,901,219
LIABILITIES
Accrued management and investment
advisory fees......................... 7,170 24,673
Accrued distribution fees.............. 4,121 19,646
Accrued transfer and administrative
fees.................................. 82,719 205,164
Accrued other expenses................. 2,449 32,536
Payables:
Capital Shares reacquired............. 25,640 247,214
Investment securities purchased....... 1,110,664 --
Collateral obligation on securities
loaned, at value...................... -- 12,644,000
------------ ------------
Total Liabilities 1,232,763 13,173,233
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................... $ 71,947,103 $342,727,986
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital....................... $ 99,331,146 $349,549,431
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............... 257,849 (165,114)
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................ (24,382,162) (6,046,956)
Net unrealized appreciation
(depreciation) of investments......... (3,259,730) (609,375)
------------ ------------
Total Net Assets $ 71,947,103 $342,727,986
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized...................... 100,000,000 125,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................... $ 61,665,313 $285,703,989
Shares issued and outstanding........ 6,621,350 25,436,791
Net asset value per share............ $ 9.31 $ 11.23
Maximum offering price per share
/(a)/ ................................ $ 9.88 $ 11.79
============ ============
Class B: Net Assets.................... $ 10,281,790 $ 57,023,997
Shares issued and outstanding........ 1,108,479 5,105,565
Net asset value per share /(b)/ ..... $ 9.28 $ 11.17
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value for
Principal / /Equity Income Fund, Inc. and 4.75% of the offering price or 4.99%
of the net asset value for Principal Government Securities Income Fund, Inc./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
4
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
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PRINCIPAL PRINCIPAL
GROWTH INTERNATIONAL EMERGING
FUND, INC. MARKETS FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST $ 337,136,725 $ 34,821,213
============= ============
FOREIGN CURRENCY--AT COST ........ $ -- $ 110,644
============= ============
ASSETS
Investment in securities--at value $318,198,315/(c)/ $40,211,227/(c)/
Foreign currency--at value........ -- 110,245
Cash.............................. 10,000 735,963
Receivables:
Capital Shares sold.............. 73,693 6,100
Dividends and interest........... 184,707 145,020
Investment securities sold....... -- 10,083
Other assets...................... 13,740 339
Prepaid directors' expenses....... 3,308 612
------------- ------------
Total Assets 318,483,763 41,219,589
LIABILITIES
Accrued management and investment
advisory fees.................... 30,977 8,772
Accrued distribution fees......... 15,180 2,684
Accrued transfer and
administrative fees.............. 370,037 31,293
Accrued other expenses............ 46,399 28,861
Payables:
Capital Shares reacquired........ 139,169 87,503
Collateral obligation on
securities loaned, at value...... 5,380,000 914,251
------------- ------------
Total Liabilities 5,981,762 1,073,364
------------- ------------
NET ASSETS APPLICABLE TO
OUTSTANDING SHARES............... $ 312,502,001 $ 40,146,225
============= ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital.................. $ 491,497,880 $ 34,977,342
Accumulated undistributed
(overdistributed) net investment
income (operating loss).......... (847,228) 31,659
Accumulated undistributed
(overdistributed) net realized
gain (loss)...................... (159,210,241) (248,036)
Net unrealized appreciation
(depreciation) of investments.... (18,938,410) 5,390,014
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies....................... -- (4,754)
------------- ------------
Total Net Assets $ 312,502,001 $ 40,146,225
============= ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized................. 200,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets............... $ 267,765,091 $ 31,286,116
Shares issued and outstanding... 10,148,155 2,877,827
Net asset value per share....... $ 26.39 $ 10.87
Maximum offering price per share
/(a)/ ........................... $ 28.00 $ 11.53
============= ============
Class B: Net Assets............... $ 44,736,910 $ 8,860,109
Shares issued and outstanding... 1,768,699 851,794
Net asset value per share /(b)/ $ 25.29 $ 10.40
============= ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
5
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
INTERNATIONAL INTERNATIONAL
FUND, INC. SMALLCAP FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ... $258,063,003 $ 50,605,144
============ ============
FOREIGN CURRENCY--AT COST ........... $ 3,083,761 $ --
============ ============
ASSETS
Investment in securities--at value... $273,815,661/(c)/ $63,009,919/(c)/
Foreign currency--at value........... 3,080,385 --
Cash................................. 21,881 781
Receivables:
Capital Shares sold................. 41,413 18,035
Dividends and interest.............. 1,047,251 258,966
Expense reimbursement from Manager.. -- 574
Investment securities sold.......... 4,338,404 --
Other assets......................... 5,254 543
Prepaid directors' expenses.......... 2,751 636
------------ ------------
Total Assets 282,353,000 63,289,454
LIABILITIES
Accrued management and investment
advisory fees....................... 33,983 11,173
Accrued distribution fees............ 9,423 3,713
Accrued transfer and administrative
fees................................ 207,006 66,872
Accrued other expenses............... 58,895 33,012
Payables:
Capital Shares reacquired........... 157,542 70,698
Indebtedness........................ -- 10,000
Investment securities purchased..... 3,253,955 342,801
Collateral obligation on securities
loaned, at value.................... 40,171,426 6,953,468
------------ ------------
Total Liabilities 43,892,230 7,491,737
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................. $238,460,770 $ 55,797,717
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital..................... $301,335,338 $ 53,458,909
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............. 376,291 (160,634)
Accumulated undistributed
(overdistributed) net realized gain
(loss).............................. (78,967,461) (9,896,464)
Net unrealized appreciation
(depreciation) of investments....... 15,752,658 12,404,775
Net unrealized appreciation
(depreciation) on translation of
assets and liabilities in foreign
currencies.......................... (36,056) (8,869)
------------ ------------
Total Net Assets $238,460,770 $ 55,797,717
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized.................... 325,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................. $210,402,374 $ 43,344,777
Shares issued and outstanding...... 31,185,881 3,145,796
Net asset value per share.......... $ 6.75 $ 13.78
Maximum offering price per share
/(a)/ .............................. $ 7.16 $ 14.62
============ ============
Class B: Net Assets.................. $ 28,058,396 $ 12,452,940
Shares issued and outstanding...... 4,241,897 949,404
Net asset value per share /(b)/ ... $ 6.61 $ 13.12
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
6
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
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PRINCIPAL PRINCIPAL
LARGECAP STOCK LIMITED TERM
INDEX FUND, INC. BOND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Investment in affiliated securities--at
cost.................................... $ 53,111 $ --
Investment in securities--at cost........ 69,941,746 120,285,525
------------ ------------
TOTAL INVESTMENTS--AT COST .............. $ 69,994,857 $120,285,525
============ ============
ASSETS
Investment in affiliated securities--at
value................................... $ 64,811 $ --
Investment in securities--at value....... 64,290,438/(c)/ 121,156,877/(c)/
Cash..................................... 14,997 10,249
Receivables:
Capital Shares sold..................... 45,828 49,274
Dividends and interest.................. 65,881 1,186,023
Expense reimbursement from Manager...... 946 --
Investment securities sold.............. 106,410 3,197
Other assets............................. 515 985
Prepaid directors' expenses.............. 747 1,445
------------ ------------
Total Assets 64,590,573 122,408,050
LIABILITIES
Accrued management and investment
advisory fees........................... 3,713 9,753
Accrued distribution fees................ 2,197 3,864
Accrued transfer and administrative fees. 36,992 39,416
Accrued other expenses................... 6,504 3,736
Payables:
Capital Shares reacquired............... 19,047 603,418
Investment securities purchased......... 160,058 186,835
Variation margin on futures contracts... 20,000 --
Collateral obligation on securities
loaned, at value........................ 971,000 840,440
------------ ------------
Total Liabilities 1,219,511 1,687,462
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ................................. $ 63,371,062 $120,720,588
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital......................... $ 71,492,487 $123,370,729
Accumulated undistributed
(overdistributed) net investment income
(operating loss)........................ 113,699 (1,654,119)
Accumulated undistributed
(overdistributed) net realized gain
(loss).................................. (2,565,441) (1,867,374)
Net unrealized appreciation
(depreciation) of investments........... (5,669,683) 871,352
------------ ------------
Total Net Assets $ 63,371,062 $120,720,588
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A SHARE):
Shares authorized........................ 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets...................... $ 51,295,761 $103,249,586
Shares issued and outstanding.......... 6,266,232 10,763,834
Net asset value per share.............. $ 8.19 $ 9.59
Maximum offering price per share /(a)/ $ 8.31 $ 9.74
============ ============
Class B: Net Assets...................... $ 12,075,301 $ 17,471,002
Shares issued and outstanding.......... 1,473,601 1,794,465
Net asset value per share /(b)/ ....... $ 8.19 $ 9.74
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 1.50% of the offering price or 1.52% of the net asset value./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
7
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
MIDCAP PARTNERS BLUE
FUND, INC. CHIP FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ..... $420,962,277 $145,722,129
============ ============
ASSETS
Investment in securities--at value..... $517,300,277/(c)/ $153,256,749/(c)/
Cash................................... 10,000 399,965
Receivables:
Capital Shares sold................... 57,483 3,544
Dividends and interest................ 171,565 183,730
Investment securities sold............ 1,947,243 87,018
Other assets........................... 7,936 3,040
Prepaid directors' expenses............ 6,133 1,794
------------ ------------
Total Assets 519,500,637 153,935,840
LIABILITIES
Accrued management and investment
advisory fees......................... 46,756 15,429
Accrued distribution fees.............. 18,651 8,221
Accrued transfer and administrative
fees.................................. 300,609 177,714
Accrued other expenses................. 42,896 16,934
Payables:
Capital Shares reacquired............. 221,481 41,107
Investment securities purchased....... 685,669 164,831
Variation margin on futures contracts. -- 1,200
Collateral obligation on securities
loaned, at value...................... 7,132,000 273,000
------------ ------------
Total Liabilities 8,448,062 698,436
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................... $511,052,575 $153,237,404
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital....................... $387,430,083 $177,961,530
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............... (152,615) 43,664
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................ 27,437,107 (32,297,356)
Net unrealized appreciation
(depreciation) of investments......... 96,338,000 7,529,566
------------ ------------
Total Net Assets $511,052,575 $153,237,404
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized...................... 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................... $437,733,592 $124,695,848
Shares issued and outstanding........ 10,746,946 7,238,627
Net asset value per share............ $ 40.73 $ 17.23
Maximum offering price per share
/(a)/ ................................ $ 43.21 $ 18.28
============ ============
Class B: Net Assets.................... $ 73,318,983 $ 28,541,556
Shares issued and outstanding........ 1,889,406 1,723,761
Net asset value per share /(b)/ ..... $ 38.81 $ 16.56
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
8
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS EQUITY PARTNERS LARGECAP
GROWTH FUND, INC. BLEND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ..... $ 67,959,104 $ 52,226,680
============ ============
ASSETS
Investment in securities--at value..... $63,454,888/(c)/ $ 53,864,221
Cash................................... 391,504 504,148
Receivables:
Capital Shares sold................... 1,625 199,193
Dividends and interest................ 48,860 46,019
Expense reimbursement from Manager.... -- 822
Investment securities sold............ 384,900 139,558
Other assets........................... 751 253
Prepaid directors' expenses............ 711 803
------------ ------------
Total Assets 64,283,239 54,755,017
LIABILITIES
Accrued management and investment
advisory fees......................... 7,736 6,815
Accrued distribution fees.............. 4,310 4,124
Accrued transfer and administrative
fees.................................. 86,356 34,373
Accrued other expenses................. 23,499 10,861
Payables:
Capital Shares reacquired............. 24,284 30,090
Investment securities purchased....... 189,838 356,672
Variation margin on futures contracts. -- 2,400
Collateral obligation on securities
loaned, at value...................... 3,023,000 --
------------ ------------
Total Liabilities 3,359,023 445,335
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................... $ 60,924,216 $ 54,309,682
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital....................... $ 91,313,234 $ 50,834,204
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............... (291,865) (39,679)
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................ (25,592,937) 1,878,586
Net unrealized appreciation
(depreciation) of investments......... (4,504,216) 1,636,571
------------ ------------
Total Net Assets $ 60,924,216 $ 54,309,682
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized...................... 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................... $ 45,418,745 $ 37,522,842
Shares issued and outstanding........ 6,333,765 3,904,000
Net asset value per share............ $ 7.17 $ 9.61
Maximum offering price per share
/(a)/ ................................ $ 7.61 $ 10.20
============ ============
Class B: Net Assets.................... $ 15,505,471 $ 16,786,840
Shares issued and outstanding........ 2,235,949 1,789,672
Net asset value per share /(b)/ ..... $ 6.93 $ 9.38
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
9
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS LARGECAP PARTNERS MIDCAP
VALUE FUND, INC. GROWTH FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ..... $ 49,458,608 $ 28,037,065
============ ============
ASSETS
Investment in securities--at value..... $ 55,600,181 $ 30,717,639
Cash................................... 1,502,784 715,579
Receivables:
Capital Shares sold................... 49,933 9,329
Dividends and interest................ 63,847 6,871
Expense reimbursement from Manager.... -- 965
Investment securities sold............ 104,560 780,391
Other assets........................... 270 237
Prepaid directors' expenses............ 834 555
------------ ------------
Total Assets 57,322,409 32,231,566
LIABILITIES
Accrued management and investment
advisory fees......................... 7,211 4,940
Accrued distribution fees.............. 4,187 2,410
Accrued transfer and administrative
fees.................................. 32,813 30,258
Accrued other expenses................. 5,005 5,066
Payables:
Capital Shares reacquired............. 69,377 90,304
Investment securities purchased....... 31,012 276,280
------------ ------------
Total Liabilities 149,605 409,258
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ............................... $ 57,172,804 $ 31,822,308
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital....................... $ 51,122,490 $ 41,174,149
Accumulated undistributed
(overdistributed) net investment
income (operating loss)............... 61,622 (312,229)
Accumulated undistributed
(overdistributed) net realized gain
(loss)................................ (152,881) (11,720,186)
Net unrealized appreciation
(depreciation) of investments......... 6,141,573 2,680,574
------------ ------------
Total Net Assets $ 57,172,804 $ 31,822,308
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized...................... 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets.................... $ 41,034,465 $ 22,539,613
Shares issued and outstanding........ 3,535,360 4,463,427
Net asset value per share............ $ 11.61 $ 5.05
Maximum offering price per share
/(a)/ ................................ $ 12.32 $ 5.36
============ ============
Class B: Net Assets.................... $ 16,138,339 $ 9,282,695
Shares issued and outstanding........ 1,407,572 1,881,494
Net asset value per share /(b)/ ..... $ 11.47 $ 4.93
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
See accompanying notes.
10
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS SMALLCAP REAL ESTATE
GROWTH FUND, INC. SECURITIES FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST . $ 14,948,332 $ 52,274,292
============ ============
ASSETS
Investment in securities--at value. $ 17,163,425 $ 58,533,427
Cash............................... 505,093 10,001
Receivables:
Capital Shares sold............... 3,358 124,816
Dividends and interest............ 3,784 65,679
Expense reimbursement from Manager 637 --
Other assets....................... 79 453
Prepaid directors' expenses........ 261 940
------------ ------------
Total Assets 17,676,637 58,735,316
LIABILITIES
Accrued management and investment
advisory fees..................... 2,707 8,758
Accrued distribution fees.......... 1,346 3,885
Accrued transfer and administrative
fees.............................. 13,902 32,244
Accrued other expenses............. 2,784 3,199
Payables:
Capital Shares reacquired......... 39,023 29,977
Investment securities purchased... 22,842 254,207
------------ ------------
Total Liabilities 82,604 332,270
------------ ------------
NET ASSETS APPLICABLE TO
OUTSTANDING SHARES................ $ 17,594,033 $ 58,403,046
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital................... $ 20,709,560 $ 44,951,475
Accumulated undistributed
(overdistributed) net investment
income (operating loss)........... (164,888) (56,703)
Accumulated undistributed
(overdistributed) net realized
gain (loss)....................... (5,165,732) 7,249,139
Net unrealized appreciation
(depreciation) of investments..... 2,215,093 6,259,135
------------ ------------
Total Net Assets $ 17,594,033 $ 58,403,046
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A
SHARE):
Shares authorized.................. 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets................ $ 12,060,795 $ 44,775,117
Shares issued and outstanding.... 2,282,642 3,418,236
Net asset value per share........ $ 5.28 $ 13.10
Maximum offering price per share
/(a)/ ............................ $ 5.60 $ 13.90
============ ============
Class B: Net Assets................ $ 5,533,238 $ 13,627,929
Shares issued and outstanding.... 1,073,927 1,046,628
Net asset value per share /(b)/ . $ 5.15 $ 13.02
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
See accompanying notes.
11
STATEMENTS OF ASSETS AND LIABILITIES
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
SMALLCAP TAX-EXEMPT
FUND, INC. BOND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
INVESTMENT IN SECURITIES--AT COST ....... $109,525,739 $176,161,032
============ ============
ASSETS
Investment in securities--at value....... $114,650,914/(c)/ $179,808,918
Cash..................................... 337,281 32,404
Receivables:
Capital Shares sold..................... 7,175 1,063
Dividends and interest.................. 61,893 2,376,012
Investment securities sold.............. 208,922 --
Other assets............................. 1,118 9,951
Prepaid directors' expenses.............. 1,083 1,646
------------ ------------
Total Assets 115,268,386 182,229,994
LIABILITIES
Accrued management and investment
advisory fees........................... 14,814 13,988
Accrued distribution fees................ 6,997 7,216
Accrued transfer and administrative fees. 127,856 41,006
Accrued other expenses................... 27,469 5,350
Payables:
Capital Shares reacquired............... 23,031 150,538
Collateral obligation on securities
loaned, at value........................ 12,380,000 --
------------ ------------
Total Liabilities 12,580,167 218,098
------------ ------------
NET ASSETS APPLICABLE TO OUTSTANDING
SHARES ................................. $102,688,219 $182,011,896
============ ============
NET ASSETS CONSIST OF:
Capital Shares and additional
paid-in-capital......................... $120,208,446 $176,123,031
Accumulated undistributed
(overdistributed) net investment income
(operating loss)........................ (555,205) 387,802
Accumulated undistributed
(overdistributed) net realized gain
(loss).................................. (22,090,197) 1,853,177
Net unrealized appreciation
(depreciation) of investments........... 5,125,175 3,647,886
------------ ------------
Total Net Assets $102,688,219 $182,011,896
============ ============
CAPITAL STOCK (PAR VALUE: $.01 A SHARE):
Shares authorized........................ 100,000,000 100,000,000
NET ASSET VALUE PER SHARE:
Class A: Net Assets...................... $ 79,338,733 $170,466,372
Shares issued and outstanding.......... 9,129,063 14,042,665
Net asset value per share.............. $ 8.69 $ 12.14
Maximum offering price per share /(a)/ $ 9.22 $ 12.75
============ ============
Class B: Net Assets...................... $ 23,349,486 $ 11,545,524
Shares issued and outstanding.......... 2,827,689 947,009
Net asset value per share /(b)/ ....... $ 8.26 $ 12.19
============ ============
/(a) //Maximum offering price equals net asset value plus a front-end sales
charge of 5.75% of the offering price or 6.10% of the net asset value for
Principal / /SmallCap Fund, Inc. and 4.75% of the offering price or 4.99% of
the net asset value for Principal Tax-Exempt Bond Fund, Inc./
/(b) //Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge./
/(c) //Includes fair market value of securities loaned, see "Securities Lending"
in Notes to Financial Statements./
See accompanying notes.
12
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
BALANCED BOND
FUND, INC. FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends........................................ $ 506,210 $ --
Interest......................................... 856,561 5,401,304
Securities lending............................... 1,884 1,608
---------- -----------
Total Income 1,364,655 5,402,912
Expenses:
Management and investment advisory fees.......... 303,925 511,202
Distribution fees - Class A...................... 106,873 221,950
Distribution fees - Class B...................... 73,100 154,049
Registration fees - Class A...................... 5,513 7,934
Registration fees - Class B...................... 4,268 6,006
Shareholder reports - Class A.................... 7,840 9,204
Shareholder reports - Class B.................... 1,759 2,696
Transfer and administrative fees - Class A....... 64,885 81,293
Transfer and administrative fees - Class B....... 15,381 24,829
Auditing and legal fees.......................... 4,384 5,463
Custodian fees................................... 29,757 7,809
Directors' expenses.............................. 1,625 3,691
Registration fees................................ 8,444 9,776
Transfer and administrative fees................. 134,605 191,541
Other expenses................................... 2,711 6,969
---------- -----------
Total Gross Expenses 765,070 1,244,412
Less: Fees paid indirectly....................... 1,088 --
---------- -----------
Total Net Expenses 763,982 1,244,412
---------- -----------
Net Investment Income (Operating Loss) 600,673 4,158,500
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions.......................... 3,223,802 2,957,708
Swap agreements.................................. -- 98,080
Change in unrealized appreciation/depreciation of:
Investments...................................... (215,309) (4,010,353)
Swap agreements.................................. -- (297,832)
---------- -----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 3,008,493 (1,252,397)
---------- -----------
Net Increase (Decrease) in Net Assets Resulting
from Operations $3,609,166 $ 2,906,103
========== ===========
See accompanying notes.
13
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
CAPITAL VALUE CASH MANAGEMENT
FUND, INC. FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends................................... $ 3,655,590 $ --
Interest.................................... 28,757 1,909,223
Securities lending.......................... 13,721 --
------------ ----------
Total Income 3,698,068 1,909,223
Expenses:
Management and investment advisory fees..... 1,065,028 754,030
Distribution fees - Class A................. 228,278 --
Distribution fees - Class B................. 134,059 10,554
Registration fees - Class A................. 5,630 15,108
Registration fees - Class B................. 4,353 4,471
Shareholder reports - Class A.............. 14,712 8,047
Shareholder reports - Class B.............. 2,903 226
Transfer and administrative fees - Class A.. 134,870 205,499
Transfer and administrative fees - Class B.. 29,192 5,235
Auditing and legal fees..................... 5,048 4,873
Custodian fees.............................. 5,872 5,843
Directors' expenses......................... 6,028 8,119
Registration fees........................... 8,873 10,667
Transfer and administrative fees............ 255,042 210,781
Other expenses.............................. 10,696 11,441
------------ ----------
Total Gross Expenses 1,910,584 1,254,894
Less: Fees paid indirectly.................. 34,250 --
Less: Reimbursement from Manager - Class B.. -- 4,427
------------ ----------
Total Net Expenses 1,876,334 1,250,467
------------ ----------
Net Investment Income (Operating Loss) 1,821,734 658,756
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions..................... 33,160,449 --
Futures contracts........................... 242,764 --
Change in unrealized
appreciation/depreciation of:
Investments................................. (12,874,666) --
Futures contracts........................... (100,550) --
------------ ----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 20,427,997 --
------------ ----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 22,249,731 $ 658,756
============ ==========
See accompanying notes.
14
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
EQUITY INCOME GOVERNMENT SECURITIES
FUND, INC. INCOME FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................. $ 1,419,023 $ --
Interest.............................. 363,186 8,515,427
Securities lending.................... -- 1,677
----------- -----------
Total Income 1,782,209 8,517,104
Expenses:
Management and investment advisory
fees................................. 217,009 773,115
Distribution fees - Class A........... 77,990 345,305
Distribution fees - Class B........... 45,602 278,636
Registration fees - Class A........... 4,613 12,436
Registration fees - Class B........... 4,369 9,944
Shareholder reports - Class A......... 4,979 10,508
Shareholder reports - Class B......... 1,407 3,321
Transfer and administrative fees -
Class A.............................. 47,382 97,903
Transfer and administrative fees -
Class B.............................. 13,245 29,138
Auditing and legal fees............... 3,353 5,554
Custodian fees........................ 766 8,263
Directors' expenses................... 1,127 6,043
Registration fees..................... 6,390 13,476
Transfer and administrative fees...... 107,233 259,957
Other expenses........................ 2,087 11,800
----------- -----------
Total Gross Expenses 537,552 1,865,399
Less: Reimbursement from Manager -
Class B.............................. 911 --
----------- -----------
Total Net Expenses 536,641 1,865,399
----------- -----------
Net Investment Income (Operating Loss) 1,245,568 6,651,705
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions............... 4,379,008 423,861
Change in unrealized
appreciation/depreciation of:
Investments........................... (4,954,711) (4,344,328)
----------- -----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies (575,703) (3,920,467)
----------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 669,865 $ 2,731,238
=========== ===========
See accompanying notes.
15
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
GROWTH INTERNATIONAL EMERGING
FUND, INC. MARKETS FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................. $ 1,288,892 $ 583,263
Withholding tax on foreign dividends.. -- (55,844)
Interest.............................. 33,415 119
Securities lending.................... 1,721 9,678
----------- -----------
Total Income 1,324,028 537,216
Expenses:
Management and investment advisory
fees................................. 933,981 248,365
Distribution fees - Class A........... 252,262 38,748
Distribution fees - Class B........... 212,548 37,238
Registration fees - Class A........... 5,058 4,468
Registration fees - Class B........... 4,169 4,567
Shareholder reports - Class A......... 31,050 3,336
Shareholder reports - Class B......... 7,505 1,060
Transfer and administrative fees -
Class A.............................. 221,967 22,018
Transfer and administrative fees -
Class B.............................. 58,912 6,850
Auditing and legal fees............... 4,619 4,190
Custodian fees........................ 2,169 44,754
Directors' expenses................... 4,980 526
Registration fees..................... 14,923 6,465
Transfer and administrative fees...... 408,775 54,112
Other expenses........................ 8,338 1,406
----------- -----------
Total Gross Expenses 2,171,256 478,103
Less: Fees paid indirectly............ 3,477 5,401
----------- -----------
Total Net Expenses 2,167,779 472,702
----------- -----------
Net Investment Income (Operating Loss) (843,751) 64,514
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions............... (4,379,059) 5,026,585
Foreign currency transactions......... -- (29,076)
Change in unrealized
appreciation/depreciation of:
Investments........................... 16,574,256 (2,870,908)
Translation of assets and liabilities
in foreign currencies................ -- 224
----------- -----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies 12,195,197 2,126,825
----------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $11,351,446 $ 2,191,339
=========== ===========
See accompanying notes.
16
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
INTERNATIONAL INTERNATIONAL
FUND, INC. SMALLCAP FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................... $ 2,433,180 $ 588,894
Withholding tax on foreign dividends.... (281,619) (53,032)
Interest................................ 12,964 1,726
Securities lending...................... 78,266 23,441
------------ ----------
Total Income 2,242,791 561,029
Expenses:
Management and investment advisory fees. 1,027,176 313,199
Distribution fees - Class A............. 166,313 50,778
Distribution fees - Class B............. 129,675 53,354
Registration fees - Class A............. 6,753 5,664
Registration fees - Class B............. 4,403 4,916
Shareholder reports - Class A........... 17,276 5,243
Shareholder reports - Class B........... 4,046 1,072
Transfer and administrative fees - Class
A...................................... 140,167 37,533
Transfer and administrative fees - Class
B...................................... 36,364 14,147
Auditing and legal fees................. 4,986 3,698
Custodian fees.......................... 77,110 24,932
Directors' expenses..................... 3,798 790
Registration fees....................... 10,270 9,411
Transfer and administrative fees........ 239,186 91,379
Other expenses.......................... 7,510 1,193
------------ ----------
Total Gross Expenses 1,875,033 617,309
Less: Fees paid indirectly.............. 26,057 6,119
Less: Reimbursement from Manager - Class
A...................................... -- 3,026
Less: Reimbursement from Manager - Class
B...................................... -- 1,513
------------ ----------
Total Net Expenses 1,848,976 606,651
------------ ----------
Net Investment Income (Operating Loss) 393,815 (45,622)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions................. 33,378,084 6,711,186
Foreign currency transactions........... 6,922 (2,712)
Change in unrealized
appreciation/depreciation of:
Investments............................. (11,673,495) 907,430
Translation of assets and liabilities in
foreign currencies..................... (27,742) (8,094)
------------ ----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies 21,683,769 7,607,810
------------ ----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 22,077,584 $7,562,188
============ ==========
See accompanying notes.
17
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
LARGECAP STOCK LIMITED TERM
INDEX FUND, INC. BOND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends from affiliates................ $ 713 $ --
Dividends................................ 467,393 --
Interest................................. 12,604 2,176,986
Securities lending....................... 603 1,056
---------- -----------
Total Income 481,313 2,178,042
Expenses:
Management and investment advisory fees.. 102,467 288,153
Distribution fees - Class A.............. 35,603 74,412
Distribution fees - Class B.............. 25,234 40,494
Registration fees - Class A.............. 6,243 7,209
Registration fees - Class B.............. 4,944 7,610
Shareholder reports - Class A............ 4,134 2,687
Shareholder reports - Class B............ 832 767
Transfer and administrative fees - Class
A....................................... 33,699 22,041
Transfer and administrative fees - Class
B....................................... 9,132 6,810
Auditing and legal fees.................. 3,246 4,158
Custodian fees........................... 11,673 5,942
Directors' expenses...................... 820 1,905
Registration fees........................ 8,047 9,075
Transfer and administrative fees......... 78,996 75,260
Other expenses........................... 1,345 3,021
---------- -----------
Total Gross Expenses 326,415 549,544
Less: Reimbursement from Manager - Class
A....................................... 33,701 --
Less: Reimbursement from Manager - Class
B....................................... 9,991 --
---------- -----------
Total Net Expenses 282,723 549,544
---------- -----------
Net Investment Income (Operating Loss) 198,590 1,628,498
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions.................. 23,029 (11,786)
Futures contracts........................ 135,699 --
Change in unrealized
appreciation/depreciation of:
Investments.............................. 2,522,330 (994,682)
Investments in affiliates................ 6,563 --
Futures contracts........................ (67,650) --
---------- -----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 2,619,971 (1,006,468)
---------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $2,818,561 $ 622,030
========== ===========
See accompanying notes.
18
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
MIDCAP PARTNERS BLUE
FUND, INC. CHIP FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends..................................... $ 4,311,062 $1,202,978
Interest...................................... 24,494 202
Securities lending............................ 4,901 3,125
----------- ----------
Total Income 4,340,457 1,206,305
Expenses:
Management and investment advisory fees....... 1,377,870 461,995
Distribution fees - Class A................... 383,640 106,105
Distribution fees - Class B................... 217,896 134,872
Registration fees - Class A................... 8,298 4,475
Registration fees - Class B................... 6,471 6,135
Shareholder reports - Class A................. 26,053 10,342
Shareholder reports - Class B................. 5,866 3,088
Transfer and administrative fees - Class A.... 215,995 115,975
Transfer and administrative fees - Class B.... 56,775 36,439
Auditing and legal fees....................... 5,121 4,740
Custodian fees................................ 6,566 8,617
Directors' expenses........................... 7,382 2,382
Registration fees............................. 12,290 7,088
Transfer and administrative fees.............. 432,144 256,095
Other expenses................................ 11,442 4,294
----------- ----------
Total Gross Expenses 2,773,809 1,162,642
Less: Fees paid indirectly.................... 3,932 4,995
----------- ----------
Total Net Expenses 2,769,877 1,157,647
----------- ----------
Net Investment Income (Operating Loss) 1,570,580 48,658
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions....................... 27,697,140 6,223,571
Futures contracts............................. -- 39,053
Change in unrealized appreciation/depreciation
of:
Investments................................... 14,161,678 3,274,597
Futures contracts............................. -- (12,326)
----------- ----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 41,858,818 9,524,895
----------- ----------
Net Increase (Decrease) in Net Assets Resulting
from Operations $43,429,398 $9,573,553
=========== ==========
See accompanying notes.
19
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS EQUITY PARTNERS LARGECAP
GROWTH FUND, INC. BLEND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................. $ 288,144 $ 421,517
Interest.............................. 342 294
Securities lending.................... 650 --
----------- -----------
Total Income 289,136 421,811
Expenses:
Management and investment advisory
fees................................. 228,057 199,443
Distribution fees - Class A........... 56,688 46,261
Distribution fees - Class B........... 70,537 74,373
Registration fees - Class A........... 4,222 6,442
Registration fees - Class B........... 5,085 5,920
Shareholder reports - Class A......... 6,578 3,297
Shareholder reports - Class B......... 2,254 1,522
Transfer and administrative fees -
Class A.............................. 52,508 23,327
Transfer and administrative fees -
Class B.............................. 18,095 10,734
Auditing and legal fees............... 3,217 3,092
Custodian fees........................ 6,017 7,979
Directors' expenses................... 921 714
Registration fees..................... 10,264 9,054
Transfer and administrative fees...... 121,174 77,079
Other expenses........................ 1,521 1,069
----------- -----------
Total Gross Expenses 587,138 470,306
Less: Fees paid indirectly............ 36,273 2,170
Less: Reimbursement from Manager -
Class A.............................. -- 6,779
Less: Reimbursement from Manager -
Class B.............................. -- 2,037
----------- -----------
Total Net Expenses 550,865 459,320
----------- -----------
Net Investment Income (Operating Loss) (261,729) (37,509)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions............... 2,936,898 4,027,019
Futures contracts..................... -- (3,024)
Change in unrealized
appreciation/depreciation of:
Investments........................... (1,340,157) (1,420,497)
Futures contracts..................... -- (970)
----------- -----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies 1,596,741 2,602,528
----------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 1,335,012 $ 2,565,019
=========== ===========
See accompanying notes.
20
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS LARGECAP PARTNERS MIDCAP
VALUE FUND, INC. GROWTH FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends............................. $ 595,081 $ 42,020
Interest.............................. 597 221
---------- -----------
Total Income 595,678 42,241
Expenses:
Management and investment advisory
fees................................. 203,729 151,731
Distribution fees - Class A........... 49,005 30,293
Distribution fees - Class B........... 69,114 42,870
Registration fees - Class A........... 6,467 4,866
Registration fees - Class B........... 5,399 5,137
Shareholder reports - Class A......... 2,672 3,877
Shareholder reports - Class B......... 1,136 1,564
Transfer and administrative fees -
Class A.............................. 23,487 23,056
Transfer and administrative fees -
Class B.............................. 11,010 8,933
Auditing and legal fees............... 3,155 3,085
Custodian fees........................ 3,319 8,937
Directors' expenses................... 683 454
Registration fees..................... 8,801 8,891
Transfer and administrative fees...... 75,768 62,624
Other expenses........................ 1,003 708
---------- -----------
Total Gross Expenses 464,748 357,026
Less: Fees paid indirectly............ 6,609 14,896
Less: Reimbursement from Manager -
Class A.............................. -- 2,318
Less: Reimbursement from Manager -
Class B.............................. -- 238
---------- -----------
Total Net Expenses 458,139 339,574
---------- -----------
Net Investment Income (Operating Loss) 137,539 (297,333)
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions............... 874,275 3,204,317
Change in unrealized
appreciation/depreciation of:
Investments........................... 2,116,832 (3,121,223)
---------- -----------
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currencies 2,991,107 83,094
---------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $3,128,646 $ (214,239)
========== ===========
See accompanying notes.
21
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS SMALLCAP REAL ESTATE
GROWTH FUND, INC. SECURITIES FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING
LOSS)
Income:
Dividends......................... $ 22,735 $ 1,040,004
Interest.......................... 138 5,684
----------- -----------
Total Income 22,873 1,045,688
Expenses:
Management and investment advisory
fees............................. 76,246 288,716
Distribution fees - Class A....... 14,586 61,165
Distribution fees - Class B....... 23,339 66,742
Registration fees - Class A....... 4,162 5,561
Registration fees - Class B....... 4,487 4,279
Shareholder reports - Class A..... 1,737 2,912
Shareholder reports - Class B..... 771 1,062
Transfer and administrative fees -
Class A.......................... 10,473 28,580
Transfer and administrative fees -
Class B.......................... 5,252 10,602
Auditing and legal fees........... 2,833 3,389
Custodian fees.................... 6,649 3,363
Directors' expenses............... 197 893
Registration fees................. 7,503 8,374
Transfer and administrative fees.. 42,564 88,825
Other expenses.................... 455 1,313
----------- -----------
Total Gross Expenses 201,254 575,776
Less: Fees paid indirectly........ 2,960 3,761
Less: Reimbursement from Manager -
Class A.......................... 9,228 --
Less: Reimbursement from Manager -
Class B.......................... 4,265 --
----------- -----------
Total Net Expenses 184,801 572,015
----------- -----------
Net Investment Income (Operating
Loss) (161,928) 473,673
NET REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS AND FOREIGN
CURRENCIES
Net realized gain (loss) from:
Investment transactions........... 643,770 7,246,561
Change in unrealized
appreciation/depreciation of:
Investments....................... (1,091,974) (5,774,125)
----------- -----------
Net Realized and Unrealized Gain
(Loss) on Investments and Foreign
Currencies (448,204) 1,472,436
----------- -----------
Net Increase (Decrease) in Net
Assets Resulting from Operations $ (610,132) $ 1,946,109
=========== ===========
See accompanying notes.
22
STATEMENTS OF OPERATIONS
PRINCIPAL MUTUAL FUNDS
SIX MONTHS ENDED APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
SMALLCAP TAX-EXEMPT
FUND, INC. BOND FUND, INC.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET INVESTMENT INCOME (OPERATING LOSS)
Income:
Dividends.................................... $ 388,555 $ --
Interest..................................... 18,938 4,255,780
Securities lending........................... 12,002 --
----------- -----------
Total Income 419,495 4,255,780
Expenses:
Management and investment advisory fees...... 438,825 442,865
Distribution fees - Class A.................. 99,920 194,183
Distribution fees - Class B.................. 108,323 39,140
Registration fees - Class A.................. 5,394 5,683
Registration fees - Class B.................. 5,499 4,309
Shareholder reports - Class A................ 9,938 2,091
Shareholder reports - Class B................ 3,306 211
Transfer and administrative fees - Class A... 80,452 16,178
Transfer and administrative fees - Class B... 24,961 1,558
Auditing and legal fees...................... 3,602 5,259
Custodian fees............................... 15,323 1,703
Directors' expenses.......................... 1,390 3,206
Registration fees............................ 9,448 6,521
Transfer and administrative fees............. 165,776 52,931
Other expenses............................... 2,543 5,932
----------- -----------
Total Gross Expenses 974,700 781,770
Less: Fees paid indirectly................... 4,709 --
----------- -----------
Total Net Expenses 969,991 781,770
----------- -----------
Net Investment Income (Operating Loss) (550,496) 3,474,010
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES
Net realized gain (loss) from:
Investment transactions...................... 14,181,067 1,731,627
Change in unrealized appreciation/depreciation
of:
Investments.................................. (9,065,495) (3,831,845)
----------- -----------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currencies 5,115,572 (2,100,218)
----------- -----------
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 4,565,076 $ 1,373,792
=========== ===========
See accompanying notes.
23
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
BALANCED BOND
FUND, INC. FUND, INC.
- ------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------- ------------- ------------- ---------------
- ------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 600,673 $ 1,193,145 $ 4,158,500 $ 8,712,254
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 3,223,802 652,592 3,055,788 2,735,130
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (215,309) 9,710,349 (4,308,185) (1,569,324)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 3,609,166 11,556,086 2,906,103 9,878,060
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (642,838) (1,149,081) (4,040,178) (8,361,854)
Class B............... (61,975) (105,537) (598,256) (1,258,821)
------------ ------------ ------------ ------------
Total Dividends and
Distributions (704,813) (1,254,618) (4,638,434) (9,620,675)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 7,949,076 8,501,912 16,378,358 40,228,179
Class B............... 2,840,119 3,828,443 4,325,875 9,474,047
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 631,616 1,123,399 3,529,329 7,225,606
Class B............... 61,185 103,902 560,743 1,153,000
Shares redeemed:
Class A............... (8,175,555) (13,624,827) (22,789,898) (49,476,966)
Class B............... (3,341,926) (4,771,696) (6,094,842) (10,967,903)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (35,485) (4,838,867) (4,090,435) (2,364,037)
------------ ------------ ------------ ------------
Redemption fees - Class
A..................... -- -- -- 48,023
------------ ------------ ------------ ------------
Total Increase
(Decrease) 2,868,868 5,462,601 (5,822,766) (2,058,629)
NET ASSETS
Beginning of period.... 97,603,284 92,140,683 218,854,134 220,912,763
------------ ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $100,472,152 $ 97,603,284 $213,031,368 $218,854,134
============ ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 19,870 $ 88,660 $ (410,075) $ (470,787)
============ ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 642,351 771,547 1,475,253 3,611,102
Class B............... 232,577 348,303 390,773 855,831
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 51,374 101,896 317,923 653,047
Class B............... 4,990 9,516 50,567 104,254
Shares redeemed:
Class A............... (660,294) (1,249,483) (2,054,477) (4,457,936)
Class B............... (272,642) (440,377) (549,646) (990,352)
------------ ------------ ------------ ------------
Net Increase (Decrease) (1,644) (458,598) (369,607) (224,054)
============ ============ ============ ============
See accompanying notes.
24
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
CAPITAL VALUE CASH MANAGEMENT
FUND, INC. FUND, INC.
- --------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------- ------------- -------------- ----------------
- --------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 1,821,734 $ 3,522,566 $ 658,756 $ 2,168,212
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 33,403,213 4,689,125 -- --
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (12,975,216) 54,818,796 -- --
------------ ------------ ------------- -------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 22,249,731 63,030,487 658,756 2,168,212
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (3,523,805) (4,002,940) (658,633) (2,146,556)
Class B............... (49,273) (126,542) (123) (21,656)
------------ ------------ ------------- -------------
Total Dividends and
Distributions (3,573,078) (4,129,482) (658,756) (2,168,212)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 14,746,420 22,718,257 374,799,574 655,800,513
Class B............... 3,328,040 5,080,509 2,121,665 5,907,858
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 3,435,274 3,908,306 640,596 2,068,086
Class B............... 48,598 124,744 73 20,850
Shares redeemed:
Class A............... (34,731,342) (88,040,608) (402,312,513) (708,963,596)
Class B............... (6,134,189) (7,451,162) (4,116,826) (6,947,881)
------------ ------------ ------------- -------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (19,307,199) (63,659,954) (28,867,431) (52,114,170)
------------ ------------ ------------- -------------
Redemption fees - Class
A..................... -- 9,452 -- --
------------ ------------ ------------- -------------
Total Increase
(Decrease) (630,546) (4,749,497) (28,867,431) (52,114,170)
NET ASSETS
Beginning of period.... 355,501,239 360,250,736 353,987,276 406,101,446
------------ ------------ ------------- -------------
End of period
(including
undistributed net
investment income as
set forth
below).............. $354,870,693 $355,501,239 $ 325,119,845 $ 353,987,276
============ ============ ============= =============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 896,231 $ 2,681,825 $ -- $ --
============ ============ ============= =============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 640,055 1,165,770 374,799,574 655,800,513
Class B............... 145,527 262,471 2,121,665 5,907,858
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 153,566 211,716 640,596 2,068,086
Class B............... 2,182 6,783 73 20,850
Shares redeemed:
Class A............... (1,505,911) (4,419,653) (402,312,513) (708,963,596)
Class B............... (269,450) (389,637) (4,116,826) (6,947,881)
------------ ------------ ------------- -------------
Net Increase (Decrease) (834,031) (3,162,550) (28,867,431) (52,114,170)
============ ============ ============= =============
See accompanying notes.
25
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
EQUITY INCOME GOVERNMENT SECURITIES
FUND, INC. INCOME FUND, INC.
- ------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------ ------------- ------------- ----------------
- ------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 1,245,568 $ 2,680,124 $ 6,651,705 $ 14,304,942
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 4,379,008 (3,744,053) 423,861 467,983
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (4,954,711) 9,889,758 (4,344,328) (9,669,235)
----------- ------------ ------------ -------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 669,865 8,825,829 2,731,238 5,103,690
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (1,133,208) (2,352,553) (6,980,631) (14,291,737)
Class B............... (137,034) (291,326) (1,184,104) (2,267,795)
----------- ------------ ------------ -------------
Total Dividends and
Distributions (1,270,242) (2,643,879) (8,164,735) (16,559,532)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 6,917,943 7,064,406 23,768,614 94,074,528
Class B............... 2,122,887 2,224,165 6,926,102 31,134,090
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 1,064,800 2,207,321 6,049,022 12,244,953
Class B............... 132,795 281,835 1,095,658 2,050,680
Shares redeemed:
Class A............... (6,516,642) (11,783,359) (43,768,466) (103,064,902)
Class B............... (1,652,235) (3,561,430) (12,673,709) (21,564,510)
----------- ------------ ------------ -------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 2,069,548 (3,567,062) (18,602,779) 14,874,839
----------- ------------ ------------ -------------
Redemption fees - Class
A..................... -- -- -- 48
----------- ------------ ------------ -------------
Total Increase
(Decrease) 1,469,171 2,614,888 (24,036,276) 3,419,045
NET ASSETS
Beginning of period.... 70,477,932 67,863,044 366,764,262 363,345,217
----------- ------------ ------------ -------------
End of period
(including
undistributed net
investment income as
set forth below)...... $71,947,103 $ 70,477,932 $342,727,986 $ 366,764,262
=========== ============ ============ =============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 257,849 $ 282,523 $ (165,114) $ 276,421
=========== ============ ============ =============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 709,138 785,692 2,077,444 8,034,398
Class B............... 219,161 247,479 609,103 2,674,412
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 108,856 244,200 528,706 1,052,514
Class B............... 13,618 31,333 96,295 177,297
Shares redeemed:
Class A............... (669,203) (1,313,470) (3,826,776) (8,883,041)
Class B............... (170,641) (402,819) (1,113,804) (1,863,692)
----------- ------------ ------------ -------------
Net Increase (Decrease) 210,929 (407,585) (1,629,032) 1,191,888
=========== ============ ============ =============
See accompanying notes.
26
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
GROWTH INTERNATIONAL EMERGING
FUND, INC. MARKETS FUND, INC.
- ----------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------- ------------- ------------ --------------
- ----------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ (843,751) $ (1,568,714) $ 64,514 $ (12,228)
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... (4,379,059) (2,284,675) 4,997,509 2,499,742
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 16,574,256 44,204,950 (2,870,684) 8,886,025
------------ ------------ ----------- -----------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 11,351,446 40,351,561 2,191,339 11,373,539
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 17,489,715 32,639,355 5,295,688 5,140,060
Class B............... 4,168,943 7,772,555 1,464,087 867,475
Shares redeemed:
Class A............... (22,676,682) (47,606,271) (2,650,303) (5,148,772)
Class B............... (8,113,497) (14,601,648) (773,159) (892,548)
------------ ------------ ----------- -----------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (9,131,521) (21,796,009) 3,336,313 (33,785)
------------ ------------ ----------- -----------
Redemption fees - Class
A..................... -- 8,850 -- 8,757
------------ ------------ ----------- -----------
Total Increase
(Decrease) 2,219,925 18,564,402 5,527,652 11,348,511
NET ASSETS
Beginning of period.... 310,282,076 291,717,674 34,618,573 23,270,062
------------ ------------ ----------- -----------
End of period
(including
undistributed net
investment income as
set forth below)...... $312,502,001 $310,282,076 $40,146,225 $34,618,573
============ ============ =========== ===========
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ (847,228) $ -- $ 31,659 $ --
============ ============ =========== ===========
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 661,366 1,456,180 461,725 677,583
Class B............... 164,035 359,162 133,111 113,913
Shares redeemed:
Class A............... (855,353) (2,133,503) (231,465) (691,258)
Class B............... (321,102) (680,888) (71,589) (123,067)
------------ ------------ ----------- -----------
Net Increase (Decrease) (351,054) (999,049) 291,782 (22,829)
============ ============ =========== ===========
See accompanying notes.
27
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
INTERNATIONAL INTERNATIONAL
FUND, INC. SMALLCAP FUND, INC.
- -----------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------- ------------- ------------ ---------------
- -----------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 393,815 $ 1,574,354 $ (45,622) $ (148,569)
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 33,385,006 (9,400,710) 6,708,474 (2,832,621)
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (11,701,237) 52,737,956 899,336 16,404,351
------------ ------------ ----------- ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 22,077,584 44,911,600 7,562,188 13,423,161
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (1,655,792) (64,843) -- (19,057)
------------ ------------ ----------- ------------
Total Dividends and
Distributions (1,655,792) (64,843) -- (19,057)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 13,178,277 26,417,570 6,014,646 8,564,118
Class B............... 2,990,765 4,426,535 1,846,172 1,749,352
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 1,632,465 63,916 -- 17,605
Shares redeemed:
Class A............... (22,209,841) (64,183,379) (4,168,864) (10,326,549)
Class B............... (6,055,251) (9,662,970) (1,295,214) (1,941,831)
------------ ------------ ----------- ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions (10,463,585) (42,938,328) 2,396,740 (1,937,305)
------------ ------------ ----------- ------------
Redemption fees - Class
A..................... -- 41,470 -- 14,686
------------ ------------ ----------- ------------
Total Increase
(Decrease) 9,958,207 1,949,899 9,958,928 11,481,485
NET ASSETS
Beginning of period.... 228,502,563 226,552,664 45,838,789 34,357,304
------------ ------------ ----------- ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $238,460,770 $228,502,563 $55,797,717 $ 45,838,789
============ ============ =========== ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 376,291 $ 1,658,650 $ (160,634) $ (108,330)
============ ============ =========== ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 1,952,641 4,996,858 449,851 952,739
Class B............... 451,225 856,080 145,803 196,756
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 252,313 12,732 -- 2,098
Shares redeemed:
Class A............... (3,301,372) (11,938,750) (310,656) (1,145,682)
Class B............... (917,694) (1,894,920) (102,690) (222,570)
------------ ------------ ----------- ------------
Net Increase (Decrease) (1,562,887) (7,968,000) 182,308 (216,659)
============ ============ =========== ============
See accompanying notes.
28
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
LARGECAP STOCK LIMITED TERM
INDEX FUND, INC. BOND FUND, INC.
- -----------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------ ------------- ------------- ---------------
- -----------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 198,590 $ 358,227 $ 1,628,498 $ 3,039,997
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 158,728 189,148 (11,786) 397,486
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 2,461,243 7,570,247 (994,682) (595,106)
----------- ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 2,818,561 8,117,622 622,030 2,842,377
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (334,872) (255,049) (2,226,194) (3,682,022)
Class B............... (41,985) (24,147) (353,664) (590,061)
----------- ------------ ------------ ------------
Total Dividends and
Distributions (376,857) (279,196) (2,579,858) (4,272,083)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 12,361,336 14,093,984 35,419,490 61,128,599
Class B............... 3,573,996 4,054,312 2,881,013 8,437,473
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 332,314 243,056 2,047,726 3,358,719
Class B............... 41,269 23,508 333,740 561,209
Shares redeemed:
Class A............... (5,294,239) (12,503,465) (29,099,864) (41,413,201)
Class B............... (1,472,803) (1,584,001) (3,250,697) (4,403,641)
----------- ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 9,541,873 4,327,394 8,331,408 27,669,158
----------- ------------ ------------ ------------
Redemption fees - Class
A..................... -- -- -- 1,231
----------- ------------ ------------ ------------
Total Increase
(Decrease) 11,983,577 12,165,820 6,373,580 26,240,683
NET ASSETS
Beginning of period.... 51,387,485 39,221,665 114,347,008 88,106,325
----------- ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $63,371,062 $ 51,387,485 $120,720,588 $114,347,008
=========== ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 113,699 $ 291,966 $ (1,654,119) $ (1,141,630)
=========== ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 1,494,893 2,031,041 3,635,803 6,193,684
Class B............... 432,895 575,460 291,366 843,804
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 41,384 37,278 210,770 340,884
Class B............... 5,126 3,600 33,837 56,149
Shares redeemed:
Class A............... (642,882) (1,800,547) (2,993,003) (4,200,931)
Class B............... (179,666) (229,489) (329,411) (440,246)
----------- ------------ ------------ ------------
Net Increase (Decrease) 1,151,750 617,343 849,362 2,793,344
=========== ============ ============ ============
See accompanying notes.
29
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
MIDCAP PARTNERS BLUE
FUND, INC. CHIP FUND, INC.
- ------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------- ------------- ------------- ---------------
- ------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 1,570,580 $ 853,615 $ 48,658 $ (213,696)
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 27,697,140 24,260,132 6,262,624 (15,814,070)
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 14,161,678 73,829,988 3,262,271 39,327,362
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 43,429,398 98,943,735 9,573,553 23,299,596
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (1,873,467) (1,022,374) -- --
From net realized gain
on investments:
Class A............... (18,918,528) -- -- --
Class B............... (3,509,825) -- -- --
------------ ------------ ------------ ------------
Total Dividends and
Distributions (24,301,820) (1,022,374) -- --
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 36,742,341 48,796,196 10,632,784 15,831,060
Class B............... 8,644,347 12,892,737 3,072,372 4,752,689
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 20,513,434 1,003,190 -- --
Class B............... 3,468,845 -- -- --
Shares redeemed:
Class A............... (32,049,356) (55,820,235) (11,683,858) (21,193,952)
Class B............... (12,219,950) (21,920,600) (5,520,998) (7,715,065)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 25,099,661 (15,048,712) (3,499,700) (8,325,268)
------------ ------------ ------------ ------------
Redemption fees - Class
A..................... -- 4,532 -- 4,539
------------ ------------ ------------ ------------
Total Increase
(Decrease) 44,227,239 82,877,181 6,073,853 14,978,867
NET ASSETS
Beginning of period.... 466,825,336 383,948,155 147,163,551 132,184,684
------------ ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $511,052,575 $466,825,336 $153,237,404 $147,163,551
============ ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ (152,615) $ 154,204 $ 43,664 $ --
============ ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 901,291 1,447,240 621,480 1,115,604
Class B............... 222,269 401,921 186,386 344,136
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 524,601 32,082 -- --
Class B............... 93,299 -- -- --
Shares redeemed:
Class A............... (788,093) (1,671,653) (679,531) (1,505,480)
Class B............... (315,952) (693,193) (336,502) (565,071)
------------ ------------ ------------ ------------
Net Increase (Decrease) 637,415 (483,603) (208,167) (610,811)
============ ============ ============ ============
See accompanying notes.
30
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS EQUITY PARTNERS LARGECAP
GROWTH FUND, INC. BLEND FUND, INC.
- --------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------ ------------ ------------ --------------
- --------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ (261,729) $ (476,341) $ (37,509) $ (49,283)
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 2,936,898 906,171 4,023,995 (264,532)
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (1,340,157) 6,558,801 (1,421,467) 5,582,408
----------- ----------- ----------- -----------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 1,335,012 6,988,631 2,565,019 5,268,593
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 6,057,358 9,342,497 10,416,069 15,306,533
Class B............... 1,964,207 3,338,402 3,536,575 8,064,555
Shares redeemed:
Class A............... (4,738,975) (9,026,478) (7,875,168) (4,677,448)
Class B............... (1,603,599) (3,125,420) (2,189,498) (1,438,749)
----------- ----------- ----------- -----------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 1,678,991 529,001 3,887,978 17,254,891
----------- ----------- ----------- -----------
Redemption fees - Class
A..................... -- 2,306 -- --
----------- ----------- ----------- -----------
Total Increase
(Decrease) 3,014,003 7,519,938 6,452,997 22,523,484
NET ASSETS
Beginning of period.... 57,910,213 50,390,275 47,856,685 25,333,201
----------- ----------- ----------- -----------
End of period
(including
undistributed net
investment income as
set forth below)...... $60,924,216 $57,910,213 $54,309,682 $47,856,685
=========== =========== =========== ===========
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ (291,865) $ -- $ (39,679) $ --
=========== =========== =========== ===========
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 834,431 1,487,270 1,076,257 1,835,325
Class B............... 278,637 543,423 373,991 988,291
Shares redeemed:
Class A............... (652,102) (1,453,500) (800,306) (563,060)
Class B............... (228,600) (518,258) (227,009) (178,432)
----------- ----------- ----------- -----------
Net Increase (Decrease) 232,366 58,935 422,933 2,082,124
=========== =========== =========== ===========
See accompanying notes.
31
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS LARGECAP PARTNERS MIDCAP
VALUE FUND, INC. GROWTH FUND, INC.
- --------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------ ------------ ------------ --------------
- --------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ 137,539 $ 222,723 $ (297,333) $ (401,656)
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 874,275 (405,669) 3,204,317 2,857,706
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... 2,116,832 8,233,852 (3,121,223) 5,293,473
----------- ----------- ----------- -----------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 3,128,646 8,050,906 (214,239) 7,749,523
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... (235,301) (83,042) -- --
----------- ----------- ----------- -----------
Total Dividends and
Distributions (235,301) (83,042) -- --
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 10,151,957 12,197,395 6,236,919 7,891,542
Class B............... 3,579,087 5,230,108 2,078,705 3,310,997
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 200,183 68,328 -- --
Shares redeemed:
Class A............... (5,678,498) (5,507,993) (5,796,200) (4,149,097)
Class B............... (1,467,762) (1,577,506) (1,217,166) (973,526)
----------- ----------- ----------- -----------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 6,784,967 10,410,332 1,302,258 6,079,916
----------- ----------- ----------- -----------
Total Increase
(Decrease) 9,678,312 18,378,196 1,088,019 13,829,439
NET ASSETS
Beginning of period.... 47,494,492 29,116,296 30,734,289 16,904,850
----------- ----------- ----------- -----------
End of period
(including
undistributed net
investment income as
set forth below)...... $57,172,804 $47,494,492 $31,822,308 $30,734,289
=========== =========== =========== ===========
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ 61,622 $ 165,933 $ (312,229) $ --
=========== =========== =========== ===========
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 867,111 1,264,511 1,184,587 1,877,374
Class B............... 309,783 546,600 403,432 794,624
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... 17,637 7,492 -- --
Shares redeemed:
Class A............... (484,364) (576,138) (1,098,626) (1,028,151)
Class B............... (126,483) (168,247) (236,948) (254,458)
----------- ----------- ----------- -----------
Net Increase (Decrease) 583,684 1,074,218 252,445 1,389,389
=========== =========== =========== ===========
See accompanying notes.
32
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
PARTNERS SMALLCAP REAL ESTATE
GROWTH FUND, INC. SECURITIES FUND, INC.
- ---------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------ ------------ ------------- --------------
- ---------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ (161,928) $ (159,600) $ 473,673 $ 1,330,034
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 643,770 436,622 7,246,561 1,637,948
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (1,091,974) 2,936,872 (5,774,125) 10,563,724
----------- ----------- ------------ -----------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations (610,132) 3,213,894 1,946,109 13,531,706
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... -- -- (584,752) (959,267)
Class B............... -- -- (135,995) (238,737)
From net realized gain
on investments:
Class A............... -- -- (816,595) --
Class B............... -- -- (267,798) --
----------- ----------- ------------ -----------
Total Dividends and
Distributions -- -- (1,805,140) (1,198,004)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 3,886,469 4,374,822 13,510,782 16,970,298
Class B............... 1,690,183 2,146,428 3,608,716 4,635,331
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 1,127,568 699,548
Class B............... -- -- 310,128 167,784
Shares redeemed:
Class A............... (1,533,011) (1,453,119) (16,038,307) (9,988,865)
Class B............... (349,376) (250,166) (5,620,973) (1,639,056)
----------- ----------- ------------ -----------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 3,694,265 4,817,965 (3,102,086) 10,845,040
----------- ----------- ------------ -----------
Redemption fees - Class
A..................... -- -- 320 4,973
----------- ----------- ------------ -----------
Total Increase
(Decrease) 3,084,133 8,031,859 (2,960,797) 23,183,715
NET ASSETS
Beginning of period.... 14,509,900 6,478,041 61,363,843 38,180,128
----------- ----------- ------------ -----------
End of period
(including
undistributed net
investment income as
set forth below)...... $17,594,033 $14,509,900 $ 58,403,046 $61,363,843
=========== =========== ============ ===========
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ (164,888) $ -- $ (56,703) $ 194,132
=========== =========== ============ ===========
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 692,329 968,585 955,279 1,462,514
Class B............... 309,365 487,389 258,267 403,256
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 81,528 62,980
Class B............... -- -- 22,697 15,243
Shares redeemed:
Class A............... (272,747) (334,805) (1,151,117) (904,246)
Class B............... (64,148) (60,456) (407,439) (145,666)
----------- ----------- ------------ -----------
Net Increase (Decrease) 664,799 1,060,713 (240,785) 894,081
=========== =========== ============ ===========
See accompanying notes.
33
STATEMENTS OF CHANGES IN NET ASSETS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PRINCIPAL PRINCIPAL
SMALLCAP TAX-EXEMPT
FUND, INC. BOND FUND, INC.
- ------------------------------------------------------------------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
APRIL 30, OCTOBER 31, APRIL 30, OCTOBER 31,
2004 2003 2004 2003
------------- ------------- ------------- ---------------
- ------------------------------------------------------------------------------------
OPERATIONS
Net investment income
(operating loss)..... $ (550,496) $ (791,063) $ 3,474,010 $ 7,208,120
Net realized gain
(loss) from
investment
transactions and
foreign currency
transactions......... 14,181,067 870,377 1,731,627 458,841
Change in unrealized
appreciation/depreciation
of investments and
translation of assets
and liabilities in
foreign currencies.... (9,065,495) 23,010,883 (3,831,845) 587,146
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets
Resulting from
Operations 4,565,076 23,090,197 1,373,792 8,254,107
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income:
Class A............... -- -- (3,196,004) (6,588,804)
Class B............... -- -- (185,895) (401,196)
From net realized gain
on investment:
Class A............... -- -- (452,779) (706,938)
Class B............... -- -- (32,304) (53,429)
------------ ------------ ------------ ------------
Total Dividends and
Distributions -- -- (3,866,982) (7,750,367)
CAPITAL SHARE
TRANSACTIONS
Shares sold:
Class A............... 9,031,307 11,795,433 6,767,686 20,987,302
Class B............... 3,192,670 5,079,888 531,462 2,316,581
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 2,711,439 5,359,665
Class B............... -- -- 155,710 318,557
Shares redeemed:
Class A............... (6,957,637) (12,423,923) (15,036,905) (31,545,809)
Class B............... (2,850,322) (3,792,526) (2,256,971) (3,265,865)
------------ ------------ ------------ ------------
Net Increase (Decrease)
in Net Assets from
Capital Share
Transactions 2,416,018 658,872 (7,127,579) (5,829,569)
------------ ------------ ------------ ------------
Redemption fees - Class
A..................... -- -- -- 10,084
------------ ------------ ------------ ------------
Total Increase
(Decrease) 6,981,094 23,749,069 (9,620,769) (5,315,745)
NET ASSETS
Beginning of period.... 95,707,125 71,958,056 191,632,665 196,948,410
------------ ------------ ------------ ------------
End of period
(including
undistributed net
investment income as
set forth below)...... $102,688,219 $ 95,707,125 $182,011,896 $191,632,665
============ ============ ============ ============
Undistributed
(Overdistributed) Net
Investment Income
(Operating Loss)...... $ (555,205) $ -- $ 387,802 $ 417,241
============ ============ ============ ============
INCREASE (DECREASE) IN
CAPITAL SHARES
Shares sold:
Class A............... 1,016,737 1,714,982 541,260 1,698,369
Class B............... 376,540 771,014 42,400 186,585
Shares issued in
reinvestment of
dividends and
distributions:
Class A............... -- -- 217,372 435,536
Class B............... -- -- 12,432 25,811
Shares redeemed:
Class A............... (781,787) (1,858,919) (1,204,522) (2,547,538)
Class B............... (338,824) (589,493) (180,410) (263,637)
------------ ------------ ------------ ------------
Net Increase (Decrease) 272,666 37,584 (571,468) (464,874)
============ ============ ============ ============
See accompanying notes.
34
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
1. ORGANIZATION
Principal Balanced Fund, Inc., Principal Bond Fund, Inc., Principal Capital
Value Fund, Inc., Principal Cash Management Fund, Inc., Principal Equity Income
Fund, Inc., Principal Government Securities Income Fund, Inc., Principal Growth
Fund, Inc., Principal International Emerging Markets Fund, Inc., Principal
International Fund, Inc., Principal International SmallCap Fund, Inc., Principal
LargeCap Stock Index Fund, Inc., Principal Limited Term Bond Fund, Inc.,
Principal MidCap Fund, Inc., Principal Partners Blue Chip Fund, Inc., Principal
Partners Equity Growth Fund, Inc., Principal Partners LargeCap Blend Fund, Inc.,
Principal Partners LargeCap Value Fund, Inc., Principal Partners MidCap Growth
Fund, Inc., Principal Partners SmallCap Growth Fund, Inc., Principal Real Estate
Securities Fund, Inc., Principal SmallCap Fund, Inc., and Principal Tax-Exempt
Bond Fund, Inc. (the "Funds") are registered under the Investment Company Act of
1940, as amended, as open-end diversified management investment companies and
operate in the mutual fund industry.
Each fund offers both Class A shares and Class B shares to the public. Class A
shares generally are sold with an initial sales charge (with the exception of
Principal Cash Management Fund, Inc. which are sold at net asset value) based on
declining rates and certain purchases may be subject to a contingent deferred
sales charge ("CDSC") if redeemed within eighteen months of purchase. Class B
shares are sold without an initial sales charge, but bear higher ongoing
distribution fees and are subject to a declining CDSC on certain redemptions
made within six years of purchase. Class B shares automatically convert into
Class A shares, based on relative net asset value (without a sales charge),
seven years after purchase. Both classes of shares for each fund represent
interests in the same portfolio of investments, and will vote together as a
single class except where otherwise required by law or as determined by each of
the Funds' respective Board of Directors. In addition, the Board of Directors of
each fund declares separate dividends on each class of shares.
Effective March 1, 2004, Principal Utilities Fund, Inc. and Principal Real
Estate Fund, Inc. changed their names to Principal Equity Income Fund, Inc. and
Principal Real Estate Securities Fund, Inc., respectively.
2. SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. The
following summarizes the significant accounting policies of the Funds:
SECURITY VALUATION . The Funds (with the exception of Principal Cash Management
Fund, Inc.) value securities for which market quotations are readily available
at market value, which is determined using the last reported sale price. If no
sales are reported, as is regularly the case for some securities traded
over-the-counter, securities are valued using the last reported bid price or an
evaluated bid price provided by a pricing service. Pricing services use
electronic modeling techniques that incorporate security characteristics, market
conditions and dealer-supplied valuations to determine an evaluated bid price.
When reliable market quotations are not considered to be readily available,
which may be the case, for example, with respect to restricted securities,
certain debt securities, preferred stocks and foreign securities, the
investments are valued at their fair value as determined in good faith by
Principal Management Corporation (the "Manager") under procedures established
and periodically reviewed by each fund's Board of Directors.
The value of foreign securities used in computing the net asset value per share
is generally determined as of the close of the foreign exchange where the
security is principally traded. Events that occur after the close of the
applicable foreign market or exchange but prior to the calculation of the fund's
net asset value are ordinarily not reflected in the fund's net asset value. If
events that occur after the close of the applicable foreign market or exchange
but prior to the calculation of the fund's net asset value are determined to
materially affect the value of a foreign security, then the security is valued
at its fair value as determined in good faith by the Manager under procedures
established and periodically reviewed by each fund's Board of Directors.
To the extent each fund invests in foreign securities listed on foreign
exchanges which trade on days on which the fund does not determine its net asset
value, for example weekends and other customary national U.S. holidays, each
fund's net asset value could be significantly affected on days when shareholders
cannot purchase or redeem shares.
35
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Certain securities issued by companies in emerging market countries may have
more than one quoted valuation at any given point in time, sometimes referred to
as a "local" price and a "premium" price. The premium price is often a
negotiated price, which may not consistently represent a price at which a
specific transaction can be effected. It is the policy of the Funds to value
such securities at prices at which it is expected those shares may be sold, and
the Manager or any sub-advisor is authorized to make such determinations subject
to such oversight by each fund's Board of Directors as may occasionally be
necessary.
Short-term securities are valued at amortized cost, which approximates market.
Principal Cash Management Fund, Inc. values its securities at amortized cost as
permitted under Rule 2a-7 of the Investment Company Act of 1940. Under the
amortized cost method, a security is valued by applying a constant yield to
maturity of the difference between the principal amount due at maturity and the
cost of the security to the fund.
FOREIGN SECURITIES.
The value of foreign securities based in foreign currency amounts is translated
to U.S. dollars using the exchange rate at the daily close of the London
Exchange. The identified cost of the fund holdings is translated at approximate
rates prevailing when acquired. Income and expense amounts are translated at
approximate rates prevailing when received or paid, with daily accruals of such
amounts reported at approximate rates prevailing at the date of valuation. Since
the carrying amount of the foreign securities is determined based on the
exchange rate and market values at the close of the period, it is not
practicable to isolate that portion of the results of operations arising as a
result of changes in the foreign exchange rates from the fluctuations arising
from changes in the market prices of securities during the period.
Net realized foreign exchange gains or losses arise from sales of foreign
currencies, currency gains or losses realized between trade and settlement dates
on security transactions, and the difference between the amount of dividends and
foreign withholding taxes recorded on the books and the U.S. dollar equivalent
of the amounts actually received or paid. Net unrealized appreciation
(depreciation) on translation of assets and liabilities in foreign currencies
arise from changes in the exchange rate relating to assets and liabilities,
other than investments in securities, purchased and held in non-U.S. denominated
currencies.
INCOME AND INVESTMENT TRANSACTIONS. . The Funds record investment transactions
on a trade date basis. The identified cost basis has been used in determining
the net realized gain or loss from investment transactions and unrealized
appreciation or depreciation of investments. The Funds record dividend income on
the ex-dividend date, except dividend income from foreign securities whereby the
ex-dividend date has passed; such dividends are recorded as soon as the funds
are informed of the ex-dividend date. Interest income is recognized on an
accrual basis. Discounts and premiums on securities are accreted/amortized over
the lives of the respective securities. The Funds allocate daily all income and
realized and unrealized gains or losses to each class of shares based upon the
relative proportion of the value of shares outstanding (number of settled shares
outstanding for Principal Cash Management Fund, Inc.) of each class.
EXPENSES. . Expenses directly attributed to a fund are charged to that fund.
Other fund expenses not directly attributed to a fund are apportioned among the
funds managed by Principal Management Corporation.
The Funds allocate all expenses daily (other than class-specific expenses) to
each class of shares based upon the relative proportion of the value of shares
outstanding (number of settled shares outstanding for Principal Cash Management
Fund, Inc.) of each class. Class-specific expenses charged to each class during
the period ended April 30, 2004 are included separately in the statements of
operations.
36
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
DISTRIBUTIONS TO SHAREHOLDERS. . With respect to Principal Cash Management Fund,
Inc., all net investment income and any net realized gains and losses from
investment transactions are declared as dividends daily to settled shares of
record as of that day. Dividends and distributions to shareholders of the other
Funds are recorded on the ex-dividend date. Dividends and distributions to
shareholders from net investment income and net realized gain from investments
and foreign currency transactions are determined in accordance with federal tax
regulations, which may differ from accounting principles generally accepted in
the United States. These differences are primarily due to differing treatments
for mortgage-backed securities, net operating losses, amortization of premiums
and discounts, expiring capital loss carryforwards, foreign currency
transactions, sales of Passive Foreign Investment Companies, certain defaulted
securities, losses deferred due to wash sales, commission recapture, futures
contracts, swap agreements, and limitations imposed by Sections 381-384 of the
Internal Revenue Code. Permanent book and tax basis differences are reclassified
within the capital accounts based on federal tax-basis treatment; temporary
differences do not require reclassification. Distributions which exceed current
and accumulated earnings and profits for federal income tax purposes are
reported as return of capital distributions.
FEDERAL INCOME TAXES . No provision for federal income taxes is considered
necessary because each fund is qualified as a "regulated investment company"
under the Internal Revenue Code and intends to distribute each year
substantially all of its net investment income and realized capital gains to
shareholders.
FOREIGN TAXES . Certain of the funds are subject to foreign income taxes imposed
by certain countries in which they invest. Foreign income taxes are accrued by
the funds as a reduction of income. These amounts are shown as withholding tax
on foreign dividends on the statements of operations.
Gains realized upon disposition of Indian securities held by the funds are
subject to capital gains tax in India, payable prior to repatriation of sale
proceeds. The tax is computed on net realized gains, and realized losses in
excess of gains may be carried forward eight years to offset future gains. In
addition, the fund accrues an estimated deferred tax liability for future gains
on Indian securities. At April 30, 2004, Principal International Emerging
Markets Fund, Inc. had no deferred tax liability and approximate capital loss
carryforwards of $71,000, $529,000 and $520,000 that expire in 2009, 2010, and
2011, respectively.
REDEMPTION FEES . The Funds, except Principal Cash Management Fund, Inc., will
impose a redemption fee on redemptions of $30,000 or more of Class A shares
redeemed within 30 days after they are purchased. The fee is equal to 1.00% of
the total redemption amount. The fee is paid to the fund and is intended to
offset the trading costs, market impact, and other costs associated with
short-term money movement in and out of the Funds. These amounts are reflected
in the statements of changes in net assets.
3. OPERATING POLICIES
FEES PAID INDIRECTLY. . The Funds may direct certain portfolio transactions to
brokerage firms that, in turn, pay a portion of the Fund's operating expenses
through a commission recapture program. Certain of the Funds have also entered
into an arrangement with their custodian whereby interest earned on uninvested
cash balances is used to offset a portion of each fund's expenses. These amounts
are reflected in the statements of operations.
FUTURES CONTRACTS . The Funds may enter into futures contracts for both hedging
and non-hedging purposes. Initial margin deposits are made by cash deposits or
segregation of specific securities as may be required by the exchange on which
the transaction was conducted. Pursuant to the contracts, a fund agrees to
receive from or pay to the broker, an amount of cash equal to the daily
fluctuation in the value of the contract. Such receipts or payments are known as
"variation margin" and are recorded by the fund as a variation margin receivable
or payable on futures contracts. During the period the futures contracts are
open, daily changes in the value of the contracts are recognized as unrealized
gains or losses. These unrealized gains or losses are included as a component of
net unrealized appreciation (depreciation) of investments on the statements of
assets and liabilities. When the contracts are closed, the fund recognizes a
realized gain or loss equal to the difference between the proceeds from, or cost
of, the closing transaction and the fund's cost basis in the contract.
JOINT TRADING ACCOUNT . Certain of the Funds may, pursuant to an exemptive order
issued by the Securities and Exchange Commission, transfer uninvested funds into
a joint trading account. The order permits the Funds' cash balances to be
deposited into a single joint account along with the cash of other registered
investment companies managed by Principal Management Corporation. These balances
may be invested in one or more short-term instruments.
37
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
3. OPERATING POLICIES (CONTINUED)
LINE OF CREDIT. . The Funds participate with other funds managed by Principal
Management Corporation in an unsecured joint line of credit with two banks which
allow the participants to borrow up to $75 million, collectively. Borrowings are
made solely to facilitate the handling of unusual and/or unanticipated
short-term cash requirements. Interest is charged to each participant, based on
its borrowings, at a rate equal to the Fed Funds Rate plus .50%. Additionally, a
commitment fee is charged at the annual rate of .09% on the amount of the line
of credit. The commitment fee is allocated among the participating funds in
proportion to their average net assets during each calendar quarter. At April
30, 2004, Principal International SmallCap Fund, Inc. had outstanding borrowing
of $10,000 at an annual rate of 1.57%. No other Funds had outstanding borrowing
under the line of credit.
REPURCHASE AGREEMENTS . The Funds may invest in repurchase agreements that are
fully collateralized, typically by U.S. government or U.S. government agency
securities. The value of the collateral is maintained, at a minimum, in an
amount equal to the principal amount plus accrued interest of each repurchase
agreement. In the event the seller of a repurchase agreement defaults, the fund
could experience delays in the realization of the collateral.
SECURITIES LENDING. . Certain of the Funds may lend portfolio securities to
approved brokerage firms to earn additional income. Each applicable fund
receives collateral (in the form of U.S. government securities, U.S. government
agency securities, letters of credit, and/or cash) against the loaned securities
and maintains collateral in an amount not less than 100% of the market value of
the loaned securities during the period of the loan. Cash collateral received is
usually invested in short-term securities. The market value of loaned securities
is determined at the close of business of the funds and any additional required
collateral is delivered to the funds on the next business day. Although risk is
mitigated by the collateral, the fund could experience a delay in recovering its
securities and possible loss of income or value if the borrower fails to return
them. As of April 30, 2004, the Funds had securities on loan as follows:
VALUE OF VALUE OF
SECURITIES LOANED COLLATERAL
----------------- ----------
Principal Balanced Fund, Inc. $ 524,753 $ 548,638
Principal Bond Fund, Inc. 387,331 395,638
Principal Capital Value Fund, Inc. 1,437,275 1,501,000
Principal Government Securities Fund, Inc. 12,364,270 12,644,000
Principal Growth Fund, Inc. 5,151,179 5,380,000
Principal International Emerging Markets Fund, Inc. 812,229 914,251
Principal International Fund, Inc. 38,069,364 40,171,426
Principal International SmallCap Fund, Inc. 6,536,590 6,953,468
Principal LargeCap Stock Index Fund, Inc. 920,595 971,000
Principal Limited Term Bond Fund, Inc. 821,299 840,440
Principal MidCap Fund, Inc. 7,147,050 7,132,000
Principal Partners Blue Chip Fund, Inc. 265,420 273,000
Principal Partners Equity Growth Fund, Inc. 2,834,676 3,023,000
Principal SmallCap Fund, Inc. 11,563,149 12,380,000
SWAP AGREEMENTS. . Certain of the Funds may invest in swaps for the purpose of
managing their exposure to interest rate, credit or market risk. Swaps are
marked-to-market daily; changes in value are recorded as unrealized gain or
loss. These unrealized gains or losses are included as a component of net
unrealized appreciation (depreciation) of investments on the statements of
assets and liabilities. Periodic payments received or made at the end of each
measurement period are recorded as realized gain or loss on the statements of
operations. Upon termination of the swap agreement, the fund recognizes a
realized gain or loss. Notional principal amounts are used to express the extent
of involvement in these contracts, but the potential amounts subject to loss are
much lower. Risks may exceed amounts shown on the statement of assets and
liabilities. These risks include changes in the returns of the underlying
instruments, unfavorable interest rate fluctuation, failure of the
counterparties to perform under the contracts' terms and the possible lack of
liquidity with respect to the swap agreements. Details of swap agreements open
at period end are included in the funds' schedules of investments.
38
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
4. MANAGEMENT AGREEMENT AND TRANSACTIONS WITH AFFILIATES
MANAGEMENT SERVICES . The Funds have agreed to pay investment advisory and
management fees to Principal Management Corporation (wholly owned by Princor
Financial Services Corporation, a subsidiary of Principal Financial Services,
Inc.) computed at an annual percentage rate of each fund's average daily net
assets. The annual rates used in this calculation are as follows:
NET ASSETS OF FUNDS (IN MILLIONS)
---------------------------------------------
FIRST NEXT NEXT NEXT OVER
$100 $100 $100 $100 $400
----- ---- ---- ---- ----
Principal Balanced Fund, Inc. .60% .55% .50% .45% .40%
Principal Bond Fund, Inc. .50 .45 .40 .35 .30
Principal Cash Management Fund, Inc. .50 .45 .40 .35 .30
Principal Equity Income Fund, Inc. .60 .55 .50 .45 .40
Principal Government Securities Income Fund, Inc. .50 .45 .40 .35 .30
Principal International Emerging Markets Fund, Inc. 1.25 1.20 1.15 1.10 1.05
Principal International SmallCap Fund, Inc. 1.20 1.15 1.10 1.05 1.00
Principal Limited Term Bond Fund, Inc. .50 .45 .40 .35 .30
Principal MidCap Fund, Inc. .65 .60 .55 .50 .45
Principal Real Estate Securities Fund, Inc. .90 .85 .80 .75 .70
Principal SmallCap Fund, Inc. .85 .80 .75 .70 .65
Principal Tax-Exempt Bond Fund, Inc. .50 .45 .40 .35 .30
NET ASSETS OF FUNDS (IN MILLIONS)
----------------------------------------
FIRST NEXT NEXT NEXT OVER
$250 $250 $250 $250 $1,000
----- ---- ---- ---- ------
Principal Capital Value Fund, .60% .55% .50% .45% .40%
Inc.
Principal Growth Fund, Inc. .60 .55 .50 .45 .40
Principal International Fund, .85 .80 .75 .70 .65
Inc.
Principal Partners Blue Chip .60 .55 .50 .45 .40
Fund, Inc.
Principal Partners Equity .75 .70 .65 .60 .55
Growth Fund, Inc.
Principal Partners LargeCap .75 .70 .65 .60 .55
Blend Fund, Inc.
Principal Partners LargeCap .75 .70 .65 .60 .55
Value Fund, Inc.
Principal Partners SmallCap .90 .85 .80 .75 .70
Growth Fund, Inc.
OVERALL FEE
-------------
Principal LargeCap Stock Index Fund, Inc. .35%
Principal Partners MidCap Growth Fund, Inc. .90
The Funds also reimburse the Manager for transfer and administrative services,
including the cost of accounting, data processing, supplies and other services
rendered.
39
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
4. MANAGEMENT AGREEMENT AND TRANSACTIONS WITH AFFILIATES (CONTINUED)
The Manager has voluntarily agreed to limit the fund's expenses for certain of
the Funds. The limits are expressed as a percentage of average daily net assets
attributable to each class on an annualized basis during the reporting period.
The limits may be changed at any time. The operating expense limits are as
follows:
PERIOD FROM PERIOD FROM
NOVEMBER 1, 2003 MARCH 1, 2004
THROUGH FEBRUARY 29, 2004 THROUGH APRIL 30, 2004
-------------------------- -----------------------
CLASS A CLASS B CLASS A CLASS B
------------ ------------ ----------- -----------
Principal Capital Value Fund, Inc. 1.03% N/A 1.03% N/A
Principal Equity Income Fund, Inc. N/A N/A 1.35 2.10%
Principal International Emerging Markets Fund, Inc. 2.75 3.50% N/A N/A
Principal International Fund, Inc. 1.63 N/A 1.63 N/A
Principal International SmallCap Fund, Inc. N/A N/A 2.00 2.75
Principal LargeCap Stock Index Fund, Inc. .90 1.25 .90 1.25
Principal Partners Equity Growth Fund, Inc. 1.75 2.50 1.65 2.40
Principal Partners LargeCap Blend Fund, Inc. 1.75 2.50 1.45 2.20
Principal Partners LargeCap Value Fund, Inc. 1.75 2.50 1.45 2.20
Principal Partners MidCap Growth Fund, Inc. 1.95 2.70 1.75 2.50
Principal Partners SmallCap Growth Fund, Inc. 1.95 2.70 1.95 2.70
The Manager has voluntarily agreed to limit expenses paid by Principal Cash
Management Fund, Inc. to the extent necessary to assure the net asset value of
the fund's shares does not fall to less than one dollar. The limit may be
changed at any time.
DISTRIBUTION FEES . The Funds bear distribution fees with respect to each class
computed at an annual rate of up to .25% for Class A shares and 1.00% for Class
B shares of the average daily net assets attributable to each class of each fund
with the exception of the following funds:
CLASS A CLASS B
------- -------
Principal Cash Management Fund, Inc. N/A 1.00%
Principal LargeCap Stock Index Fund, Inc. .15% .50
Principal Limited Term Bond Fund, Inc. .15 .50
Distribution fees are paid to Princor Financial Services Corporation, the
principal underwriter. A portion of the fees is subsequently remitted to retail
dealers, if applicable. Pursuant to the distribution agreements for Class A and
Class B shares, fees that are unused by the principal underwriter at the end of
the fiscal year are returned to the respective fund which generated the excess.
40
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
4. MANAGEMENT AGREEMENT AND TRANSACTIONS WITH AFFILIATES (CONTINUED)
SALES CHARGES . Princor Financial Services Corporation, as principal
underwriter, receives proceeds of any CDSC on certain Class A and Class B share
redemptions. The charge is based on declining rates which for Class A shares
begin at .75% and Class B shares at 4.00% (0.25% and 1.25% for Principal
LargeCap Stock Index Fund, Inc. and Principal Limited Term Bond Fund, Inc. share
classes, respectively) of the lesser of current market value or the cost of
shares being redeemed. Princor Financial Services Corporation also retains sales
charges on sales of Class A shares (with the exception of Principal Cash
Management Fund, Inc.) based on declining rates which begin at 1.50% for
Principal LargeCap Stock Index Fund, Inc. and Principal Limited Term Bond Fund,
Inc., 4.75% for Principal Bond Fund, Inc., Principal Government Securities
Income Fund, Inc., and Principal Tax Exempt Bond Fund, Inc., and 5.75% for all
other Funds. The aggregate amounts of these charges retained by Princor
Financial Services Corporation for the period ended April 30, 2004, were as
follows:
CLASS A CLASS B
------- -------
Principal Balanced Fund, Inc. $147,025 $ 24,334
Principal Bond Fund, Inc. 247,451 40,867
Principal Capital Value Fund, Inc. 292,401 34,274
Principal Cash Management Fund, Inc. 1,780 21,326
Principal Equity Income Fund, Inc. 118,357 8,887
Principal Government Securities Income Fund, Inc. 338,008 125,945
Principal Growth Fund, Inc. 354,108 43,854
Principal International Emerging Markets Fund, Inc. 79,826 4,049
Principal International Fund, Inc. 218,488 23,268
Principal International SmallCap Fund, Inc. 128,013 8,838
Principal LargeCap Stock Index Fund, Inc. 64,866 6,916
Principal Limited Term Bond Fund, Inc. 98,432 18,546
Principal MidCap Fund, Inc. 647,363 47,740
Principal Partners Blue Chip Fund, Inc. 184,978 26,318
Principal Partners Equity Growth Fund, Inc. 146,417 15,815
Principal Partners LargeCap Blend Fund, Inc. 228,799 11,492
Principal Partners LargeCap Value Fund, Inc. 240,828 16,590
Principal Partners MidCap Growth Fund, Inc. 130,403 8,336
Principal Partners SmallCap Growth Fund, Inc. 97,842 3,372
Principal Real Estate Securities Fund, Inc. 218,788 10,951
Principal SmallCap Fund, Inc. 193,086 23,632
Principal Tax-Exempt Bond Fund, Inc. 89,225 11,551
AFFILIATED OWNERSHIP . At April 30, 2004, Principal Life Insurance Company (an
affiliate of the Manager), affiliates of Principal Life Insurance Company and
benefit plans sponsored on behalf of Principal Life Insurance Company owned
shares of the Funds as follows:
CLASS A CLASS B
---------- -----------
Principal Bond Fund, Inc. 324,457 --
Principal Capital Value Fund, Inc. 3,005,128 --
Principal Cash Management Fund, Inc. 9,278,082 --
Principal Government Securities Income Fund, Inc. 103,502 --
Principal International Emerging Markets Fund, Inc. 692,531 302,268
Principal International Fund, Inc. 5,383,272 --
Principal Limited Term Bond Fund, Inc. 606,222 --
Principal Partners LargeCap Value Fund, Inc. 276,787 79,989
Principal Partners SmallCap Growth Fund, Inc. 399,265 100,000
41
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
4. MANAGEMENT AGREEMENT AND TRANSACTIONS WITH AFFILIATES (CONTINUED)
For the period ended April 30, 2004, information, on a federal tax basis,
regarding affiliated securities held by the funds was as follows:
OCTOBER 31, 2003 PURCHASES SALES APRIL 30, 2004
----------------- ------------------------ ---------- ---------------
SHARES COST SHARES COST SHARES PROCEEDS SHARES COST
------- -------- ------ ------ ------ -------- ------ ---------
PRINCIPAL LARGECAP STOCK INDEX FUND, INC.
Principal Financial Group 1,584 $44,522 252 $8,589 -- $-- 1,836 $53,111
(parent company of Principal Financial
Services, Inc.)
DIVIDENDS REALIZED GAIN/LOSS
--------- ------------------
PRINCIPAL LARGECAP STOCK INDEX FUND,
INC.
Principal Financial Group $713 $--
(parent company of Principal
Financial Services, Inc.)
AFFILIATED BROKERAGE COMMISSIONS . With respect to Principal Equity Income Fund,
Inc., $8,424 of brokerage commissions were paid to Spectrum Asset Management,
Inc., a member of the Principal Financial Group. The other Funds did not pay
brokerage commissions to any member of the Principal Financial Group. Brokerage
commissions were paid to affiliates of sub-advisors by Principal Partners
LargeCap Value Fund, Inc. in the amount of $20,799.
5. INVESTMENT TRANSACTIONS
For the period ended April 30, 2004, the cost of investment securities purchased
and proceeds from investment securities sold (not including short-term
investments and U.S. government securities) by the Funds were as follows:
PURCHASES SALES
------------ ------------
Principal Balanced Fund, Inc. $ 70,746,247 $ 67,166,240
Principal Bond Fund, Inc. 163,406,048 165,112,692
Principal Capital Value Fund, Inc. 315,023,287 326,948,879
Principal Equity Income Fund, Inc. 50,415,278 49,667,600
Principal Government Securities Income Fund, Inc. 87,443,912 2,021,334
Principal Growth Fund, Inc. 54,391,191 67,988,567
Principal International Emerging Markets Fund, Inc. 25,990,435 23,131,627
Principal International Fund, Inc. 186,057,860 203,596,414
Principal International SmallCap Fund, Inc. 28,013,577 25,923,994
Principal LargeCap Stock Index Fund, Inc. 20,025,414 11,429,340
Principal Limited Term Bond Fund, Inc. 25,204,384 17,010,133
Principal MidCap Fund, Inc. 92,368,376 94,577,997
Principal Partners Blue Chip Fund, Inc. 46,313,199 49,201,644
Principal Partners Equity Growth Fund, Inc. 47,230,364 43,762,483
Principal Partners LargeCap Blend Fund, Inc. 48,562,617 43,390,030
Principal Partners LargeCap Value Fund, Inc. 13,721,953 6,419,894
Principal Partners MidCap Growth Fund, Inc. 27,780,151 26,872,075
Principal Partners SmallCap Growth Fund, Inc. 9,339,559 5,674,522
Principal Real Estate Securities Fund, Inc. 33,449,615 37,695,310
Principal SmallCap Fund, Inc. 105,474,153 104,737,231
Principal Tax-Exempt Bond Fund, Inc. 55,595,969 63,749,730
42
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
5. INVESTMENT TRANSACTIONS (CONTINUED)
For the period ended April 30, 2004, the cost of U.S. government securities
purchased and proceeds from U.S government securities sold (not including
short-term investments) by the Funds were as follows:
PURCHASES SALES
----------- ------------
Principal Balanced Fund, Inc. $ 3,760,439 $ 2,718,375
Principal Bond Fund, Inc. 19,763,004 14,414,923
Principal Government Securities Income -- 105,642,192
Fund, Inc.
Principal Limited Term Bond Fund, Inc. -- 51,152
The Funds may trade portfolio securities on a "to-be-announced" ("TBA") basis.
In a TBA transaction, the fund commits to purchase or sell securities for which
all specific information is not known at the time of the trade. Securities
purchased on a TBA basis are not settled until they are delivered to the fund,
normally 15 to 30 days later. These transactions are subject to market
fluctuations and their current value is determined in the same manner as for
other portfolio securities. Each fund has set aside investment securities and
other assets in excess of the commitment to serve as collateral. As of April 30,
2004, the Funds had TBA purchase commitments as follows:
FACE AMOUNT COST MARKET VALUE
----------- ----------------------- --------------
Principal Balanced Fund, $ 5,175,000 $ 5,255,684 $ 5,176,769
Inc.
Principal Bond Fund, 25,600,000 25,842,750 25,514,942
Inc.
At April 30, 2004, net federal income tax unrealized appreciation (depreciation)
of investments held by the Funds was composed of the following:
TAX COST OF NET UNREALIZED
INVESTMENTS GROSS UNREALIZED APPRECIATION
----------------------------------- (DEPRECIATION)
IN SECURITIES APPRECIATION (DEPRECIATION) OF INVESTMENTS
------------- ------------ -------------- ---------------
Principal Balanced Fund, Inc. $105,985,206 $ 7,222,997 $ (6,724,431) $ 498,566
Principal Bond Fund, Inc. 235,422,063 3,984,446 (2,643,450) 1,340,996
Principal Capital Value Fund, Inc. 337,411,737 29,588,401 (10,728,960) 18,859,441
Principal Equity Income Fund, Inc. 73,596,325 2,318,019 (5,577,749) (3,259,730)
Principal Government Securities Income Fund, Inc. 352,336,716 4,101,293 (4,710,668) (609,375)
Principal Growth Fund, Inc. 337,500,639 40,369,886 (59,672,210) (19,302,324)
Principal International Emerging Markets Fund, Inc. 34,873,215 6,674,223 (1,336,211) 5,338,012
Principal International Fund, Inc. 258,326,683 23,690,254 (8,201,276) 15,488,978
Principal International SmallCap Fund, Inc. 50,611,985 13,202,779 (804,845) 2,397,934
Principal LargeCap Stock Index Fund, Inc. 70,010,340 7,545,842 (13,200,933) (5,655,091)
Principal Limited Term Bond Fund, Inc. 121,969,538 1,027,378 (1,840,039) (812,661)
Principal MidCap Fund, Inc. 421,114,938 105,233,744 (9,048,405) 96,185,339
Principal Partners Blue Chip Fund, Inc. 147,506,794 19,870,841 (14,120,886) 5,749,955
Principal Partners Equity Growth Fund, Inc. 69,653,364 2,831,422 (9,029,898) (6,198,476)
Principal Partners LargeCap Blend Fund, Inc. 52,324,444 3,960,105 (2,420,328) 1,539,777
Principal Partners LargeCap Value Fund, Inc. 49,470,773 8,354,947 (2,225,539) 6,129,408
Principal Partners MidCap Growth Fund, Inc. 28,049,476 4,242,521 (1,574,358) 2,668,163
Principal Partners SmallCap Growth Fund, Inc. 14,949,927 3,481,487 (1,267,989) 2,213,498
Principal Real Estate Securities Fund, Inc. 52,275,477 8,953,032 (2,695,082) 6,257,950
Principal SmallCap Fund, Inc. 109,530,330 9,953,703 (4,833,119) 5,120,584
Principal Tax-Exempt Bond Fund, Inc. 175,852,894 4,642,557 (686,533) 3,956,024
43
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
5. INVESTMENT TRANSACTIONS (CONTINUED)
The Funds' investments are with various issuers in various industries, although
Principal Real Estate Securities Fund, Inc. invests primarily in the real estate
industry. The schedules of investments contained herein summarize concentrations
of credit risk by country (for international funds), issuer and industry.
6. FEDERAL TAX INFORMATION
DISTRIBUTIONS TO SHAREHOLDERS . The federal income tax character of
distributions paid for periods ended April 30, 2004 and October 31, 2003,
respectively, were as follows:
ORDINARY INCOME LONG-TERM CAPITAL GAIN
------------ --------------
2004 2003 2004 2003
---- ---- ---- ----
Principal Balanced Fund, $ 704,813 $ 1,254,618 $ -- $ --
Inc.
Principal Bond Fund, Inc. 4,638,434 9,620,675 -- --
Principal Capital Value 3,573,078 4,129,482 -- --
Fund, Inc.
Principal Cash Management 658,756 2,168,212 -- --
Fund, Inc.
Principal Equity Income 1,270,242 2,643,879 -- --
Fund, Inc.
Principal Government 8,164,735 16,559,532 -- --
Securities Income Fund, Inc.
Principal Growth Fund, Inc. -- -- -- --
Principal International -- -- -- --
Emerging Markets Fund, Inc.
Principal International 1,655,792 64,843 -- --
Fund, Inc.
Principal International -- 19,057 -- --
SmallCap Fund, Inc.
Principal LargeCap Stock 376,857 279,196 -- --
Index Fund, Inc.
Principal Limited Term Bond 2,579,858 4,272,083 -- --
Fund, Inc.
Principal MidCap Fund, Inc. 4,848,216 1,022,374 19,453,604 --
Principal Partners Blue Chip -- -- -- --
Fund, Inc.
Principal Partners Equity -- -- -- --
Growth Fund, Inc.
Principal Partners LargeCap -- -- -- --
Blend Fund, Inc.
Principal Partners LargeCap 235,301 83,042 -- --
Value Fund, Inc.
Principal Partners MidCap -- -- -- --
Growth Fund, Inc.
Principal Partners SmallCap -- -- -- --
Growth Fund, Inc.
Principal Real Estate 720,747 1,198,004 1,084,393 --
Securities Fund, Inc.
Principal SmallCap Fund, -- -- -- --
Inc.
Principal Tax-Exempt Bond 3,406,538 6,990,000 460,444 760,367
Fund, Inc.
For U.S. federal income tax purposes, short-term capital gain distributions are
considered ordinary income distributions.
44
NOTES TO FINANCIAL STATEMENTS
PRINCIPAL MUTUAL FUNDS
APRIL 30, 2004 (UNAUDITED)
-------------------------------------------------------------------------------
6. FEDERAL TAX INFORMATION (CONTINUED)
DISTRIBUTABLE EARNINGS. .
UNDISTRIBUTED UNDISTRIBUTED
ORDINARY INCOME LONG-TERM CAPITAL GAINS
---------------- -----------------------
Principal Balanced Fund, Inc. $ 140,322 $ --
Principal Bond Fund, Inc. 69,279 --
Principal Capital Value Fund,
Inc. 2,681,825 --
Principal Cash Management Fund,
Inc. -- --
Principal Equity Income Fund,
Inc. 282,523 --
Principal Government Securities
Income Fund, Inc. 276,421 --
Principal Growth Fund, Inc. -- --
Principal International Emerging
Markets Fund, Inc. -- --
Principal International Fund,
Inc. 1,658,650 --
Principal International SmallCap
Fund, Inc. -- --
Principal LargeCap Stock Index
Fund, Inc. 291,966 --
Principal Limited Term Bond Fund,
Inc. 130,010 --
Principal MidCap Fund, Inc. 3,129,433 19,454,603
Principal Partners Blue Chip
Fund, Inc. -- --
Principal Partners Equity Growth
Fund, Inc. -- --
Principal Partners LargeCap Blend
Fund, Inc. -- --
Principal Partners LargeCap Value
Fund, Inc. 165,933 --
Principal Partners MidCap Growth
Fund, Inc. -- --
Principal Partners SmallCap
Growth Fund, Inc. -- --
Principal Real Estate Securities
Fund, Inc. 194,132 1,084,571
Principal SmallCap Fund, Inc. -- --
Principal Tax-Exempt Bond Fund,
Inc. 156,460 461,759
As of October 31, 2003, the components of distributable earnings on a federal
tax basis were as follows:
CAPITAL LOSS CARRYFORWARDS . Capital loss carryforwards are losses that can be
used to offset future capital gains of the fund. At October 31, 2003, the Funds
had approximate net capital loss carryforwards as follows:
NET CAPITAL LOSS CARRYFORWARDS EXPIRING IN:
2005 2006 2007 2008 2009 2010 2011
-------- ------ ------- ---------- ----------- ----------- --------
Principal Balanced Fund, Inc. $ -- $ -- $ -- $ -- $ -- $16,045,000 $ --
Principal Bond Fund, Inc. -- -- -- 6,331,000 5,680,000 1,281,000 --
Principal Capital Value Fund, Inc. -- -- -- -- 11,361,000 34,377,000 --
Principal Equity Income Fund, Inc. -- -- -- -- 6,235,000 18,782,000 3,744,000
Principal Government Securities Income Fund, Inc. 776,000 -- 6,000 942,000 -- 1,635,000 2,041,000
Principal Growth Fund, Inc. -- -- -- -- 54,099,000 98,172,000 2,166,000
Principal International Emerging Markets Fund, Inc. -- -- -- -- 4,527,000 689,000
Principal International Fund, Inc. -- -- -- 1,144,000 55,755,000 46,940,000 7,915,000
Principal International SmallCap Fund, Inc. -- -- -- -- 10,352,000 3,157,000 3,073,000
Principal LargeCap Stock Index Fund, Inc. -- -- -- -- 917,000 1,755,000 --
Principal Limited Term Bond Fund, Inc. 21,000 9,000 32,000 263,000 197,000 895,000 --
Principal Partners Blue Chip Fund, Inc. -- -- -- -- 1,979,000 15,878,000 18,843,000
Principal Partners Equity Growth Fund, Inc. -- -- -- 3,181,000 15,271,000 7,931,000 --
Principal Partners LargeCap Blend Fund, Inc. -- -- -- -- 283,000 1,378,000 287,000
Principal Partners LargeCap Value Fund, Inc. -- -- -- -- -- 616,000 397,000
Principal Partners MidCap Growth Fund, Inc. -- -- -- -- 9,877,000 5,044,000 --
Principal Partners SmallCap Growth Fund, Inc. -- -- -- -- 1,869,000 3,942,000 --
Principal SmallCap Fund, Inc. -- -- -- -- 5,050,000 31,111,000 --
45
SCHEDULE OF INVESTMENTS
PRINCIPAL BALANCED FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (63.73%)
ADVERTISING AGENCIES (0.11%)
$
Omnicom Group 1,410 112,109
ADVERTISING SERVICES (0.06%)
WPP Group 1,233 60,775
AEROSPACE & DEFENSE EQUIPMENT (0.82%)
Alliant Techsystems /1/ 202 11,976
General Dynamics 3,620 338,904
Moog /1/ 407 13,431
Orbital Sciences /1/ /2/ 1,020 13,138
United Defense Industries /1/ 3,323 115,142
United Technologies 3,880 334,689
827,280
AGRICULTURAL OPERATIONS (0.36%)
Monsanto 10,500 363,195
AIRLINES (0.03%)
ExpressJet Holdings /1/ 1,847 23,494
Mesa Air Group /1/ 873 6,172
29,666
APPAREL MANUFACTURERS (0.24%)
Coach /1/ 5,140 218,964
Kellwood 287 11,322
Quiksilver /1/ 603 13,043
243,329
APPLICATIONS SOFTWARE (1.55%)
Citrix Systems /1/ 11,400 217,170
Microsoft 50,020 1,299,019
Serena Software /1/ 992 17,628
SS&C Technologies 672 15,517
Verint Systems /1/ 287 7,709
1,557,043
ATHLETIC FOOTWEAR (0.03%)
Reebok International 835 30,377
AUDIO & VIDEO PRODUCTS (0.21%)
Matsushita Electric Industrial 4,650 68,727
Pioneer 1,400 40,110
Polycom /1/ 5,357 102,212
211,049
AUTO-CARS & LIGHT TRUCKS (0.23%)
Nissan Motor 5,146 112,697
Toyota Motor 1,646 120,504
233,201
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.56%)
Navistar International /1/ 3,080 139,062
Oshkosh Truck 388 19,866
Paccar 5,800 327,468
Volvo /1/ 2,096 72,039
558,435
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.42%)
American Axle & Manufacturing Holdings /1/ 5,336 205,276
Dana 5,346 107,775
Lear 403 24,430
Magna International 620 48,918
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (CONTINUED)
$
Tenneco Automotive /1/ 2,374 32,761
419,160
BEVERAGES-NON-ALCOHOLIC (1.32%)
Coca-Cola 11,720 592,680
Coca-Cola Enterprises 7,170 193,590
PepsiAmericas 1,623 32,509
Pepsico 9,380 511,116
1,329,895
BEVERAGES-WINE & SPIRITS (0.08%)
Diageo 1,424 77,608
BREWERY (0.16%)
Anheuser-Busch 3,160 161,918
BROADCASTING SERVICES & PROGRAMMING (0.01%)
4 Kids Entertainment /1/ 567 12,389
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.10%)
CRH 2,959 64,654
Simpson Manufacturing 210 10,954
USG /1/ 2,056 29,257
104,865
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.11%)
Florida Rock Industries 2,385 94,899
Martin Marietta Materials 435 18,814
113,713
BUILDING PRODUCTS-LIGHT FIXTURES (0.02%)
Genlyte Group /1/ 281 16,107
BUILDING PRODUCTS-WOOD (0.02%)
Universal Forest Products 664 17,988
BUILDING-HEAVY CONSTRUCTION (0.02%)
Washington Group International /1/ 687 24,814
BUILDING-MAINTENANCE & SERVICE (0.02%)
Rollins 808 19,190
BUILDING-RESIDENTIAL & COMMERCIAL (0.29%)
Brookfield Homes 987 31,910
Centex 3,272 156,892
Hovnanian Enterprises /1/ 878 31,582
KB Home 727 50,112
M/I Schottenstein Homes 579 24,694
295,190
CABLE TV (0.15%)
Comcast /1/ 5,050 152,005
CASINO HOTELS (0.17%)
Ameristar Casinos 398 12,625
Mandalay Resort Group 2,820 162,009
174,634
CASINO SERVICES (0.28%)
International Game Technology 6,650 250,971
Scientific Games /1/ 1,630 29,405
280,376
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
CELLULAR TELECOMMUNICATIONS (0.77%)
$
America Movil 1,900 64,220
Boston Communications Group /1/ 1,010 10,868
Nextel Communications /1/ 17,300 412,778
Vodafone Group 9,213 226,087
Western Wireless /1/ 2,710 56,422
770,375
CHEMICALS-DIVERSIFIED (0.22%)
Akzo Nobel 1,305 47,540
Dow Chemical 3,560 141,296
Hercules /1/ 2,364 26,264
Octel 217 5,056
220,156
CHEMICALS-SPECIALTY (0.08%)
MacDermid 392 12,693
Minerals Technologies 344 20,176
OM Group /1/ 1,798 45,759
78,628
CIRCUIT BOARDS (0.04%)
Benchmark Electronics /1/ 1,324 35,788
COATINGS & PAINT (0.10%)
Valspar 2,040 101,286
COMMERCIAL BANKS (1.60%)
Banco Bradesco 750 30,487
Banco Santander Central Hispano /2/ 9,918 105,329
BancorpSouth 838 16,953
Bank of Ireland 1,240 60,710
Bank of Nova Scotia 3,340 84,903
City Holding 206 6,304
Columbia Banking Systems 533 11,961
Commerce Bancorp. 737 42,016
Community Bank System 518 10,536
Cullen/Frost Bankers 233 10,089
First Bancorp. 454 16,734
First Midwest Bancorp 407 13,736
Greater Bay Bancorp 1,705 48,371
Hibernia 2,532 55,172
Hudson United Bancorp 3,020 107,905
Kookmin Bank /1/ 857 31,795
Marshall & Ilsley 5,680 208,854
North Fork Bancorp. 6,600 244,992
Pacific Capital Bancorp. 719 26,373
Provident Bankshares 120 3,380
R&G Financial 967 29,929
South Financial Group 1,775 49,167
SouthTrust 500 15,540
UnionBanCal 3,660 195,554
Zions Bancorp 3,160 178,603
1,605,393
COMMERCIAL SERVICE-FINANCE (0.36%)
H&R Block 565 25,487
Moody's 2,497 161,081
Paychex 4,620 172,234
358,802
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL SERVICES (0.04%)
$
Corporate Executive Board 331 17,096
Pre-Paid Legal Services /1/ 840 21,000
38,096
COMMUNICATIONS SOFTWARE (0.03%)
Inter-Tel 1,072 25,664
COMPUTER AIDED DESIGN (0.19%)
Aspen Technology /1/ 2,278 14,807
Autodesk 5,110 171,185
185,992
COMPUTER SERVICES (0.09%)
Anteon International /1/ 756 23,587
CACI International /1/ 862 39,221
Cognizant Technology Solutions /1/ 398 17,218
SRA International /1/ 387 14,520
94,546
COMPUTERS (0.51%)
Hewlett-Packard 6,000 118,200
International Business Machines 4,520 398,528
516,728
COMPUTERS-INTEGRATED SYSTEMS (0.65%)
Dell /1/ 18,195 631,549
RadiSys /1/ 1,193 22,273
653,822
COMPUTERS-MEMORY DEVICES (0.62%)
EMC /1/ 8,080 90,173
SanDisk /1/ 3,323 76,795
Storage Technology /1/ 561 14,737
TDK 790 55,261
Veritas Software /1/ 14,550 388,048
625,014
COMPUTERS-PERIPHERAL EQUIPMENT (0.07%)
Electronics for Imaging /1/ /2/ 1,144 29,035
Lexmark International /1/ 460 41,611
70,646
CONSULTING SERVICES (0.01%)
Charles River Associates /1/ 373 12,037
CONSUMER PRODUCTS-MISCELLANEOUS (0.01%)
Central Garden & Pet /1/ 348 13,402
CONTAINERS-METAL & GLASS (0.22%)
Ball 3,120 205,920
Silgan Holdings /1/ 313 13,168
219,088
COSMETICS & TOILETRIES (2.12%)
Alberto-Culver 1,105 52,112
Avon Products 5,870 493,080
Colgate-Palmolive 1,640 94,923
Gillette 1,290 52,787
International Flavors & Fragrances 6,610 239,612
Kimberly-Clark 2,330 152,499
Procter & Gamble 9,870 1,043,752
2,128,765
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DATA PROCESSING & MANAGEMENT (0.43%)
$
Fair, Isaac 2,346 79,107
First Data 1,550 70,354
Fiserv /1/ 2,330 85,185
Global Payments /2/ 2,683 128,730
SEI Investments 2,430 71,734
435,110
DENTAL SUPPLIES & EQUIPMENT (0.04%)
Sybron Dental Specialties /1/ 1,364 39,897
DIAGNOSTIC EQUIPMENT (0.01%)
Gen-Probe /1/ 245 8,168
DIAGNOSTIC KITS (0.13%)
IDEXX Laboratories /1/ 2,171 132,995
DIALYSIS CENTERS (0.03%)
DaVita /1/ 546 27,901
DIRECT MARKETING (0.03%)
Catalina Marketing /1/ 1,651 27,374
DISPOSABLE MEDICAL PRODUCTS (0.15%)
C.R. Bard 1,320 140,276
Merit Medical Systems /1/ 842 13,228
153,504
DISTRIBUTION-WHOLESALE (0.13%)
Aviall /1/ 758 12,545
Fastenal 1,150 63,100
Owens & Minor 401 9,744
United Stationers /1/ 755 28,690
Watsco 725 21,134
135,213
DIVERSIFIED FINANCIAL SERVICES (1.38%)
Citigroup 28,790 1,384,511
DIVERSIFIED MANUFACTURING OPERATIONS (2.43%)
3M 5,050 436,724
Ameron International 201 6,020
Carlisle 496 29,388
Crane 4,060 125,089
Danaher 1,500 138,780
Eaton 2,580 153,200
General Electric 39,300 1,177,035
Illinois Tool Works 1,570 135,350
Siemens 1,305 93,151
SPX 1,760 78,056
Tyco International 2,680 73,566
2,446,359
DIVERSIFIED MINERALS (0.18%)
Anglo American 2,590 52,758
BHP Billiton 4,750 77,948
Cia Vale do Rio Doce 1,170 53,235
183,941
DIVERSIFIED OPERATIONS (0.07%)
Tomkins 3,537 68,441
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (0.38%)
$
Cendant 16,090 381,011
E-COMMERCE-PRODUCTS (0.17%)
Amazon.com /1/ 3,880 168,625
E-COMMERCE-SERVICES (0.06%)
eBay /1/ 800 63,856
E-MARKETING-INFORMATION (0.04%)
Digital River /1/ 226 5,820
Digitas /1/ 3,096 30,681
E.piphany /1/ 1,653 7,240
43,741
ELECTRIC PRODUCTS-MISCELLANEOUS (0.10%)
Hitachi 1,120 79,744
Littelfuse /1/ 620 23,808
103,552
ELECTRIC-INTEGRATED (1.81%)
CenterPoint Energy 11,540 124,517
Cleco 1,719 30,856
Constellation Energy Group 6,440 247,811
E.ON 878 58,343
Edison International 11,660 272,844
Enel 1,820 72,600
Entergy 2,770 151,242
Exelon 4,944 330,951
Great Plains Energy 3,770 117,662
MDU Resources Group 1,829 40,970
OGE Energy 868 20,875
Scottish Power 3,020 83,503
TXU 6,730 229,762
Westar Energy 1,952 39,840
1,821,776
ELECTRIC-TRANSMISSION (0.10%)
National Grid Group 2,611 100,236
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.38%)
DSP Group /1/ 1,422 35,237
Koninklijke Philips Electronics 2,376 63,701
Methode Electronics 1,263 14,322
Omron 1,531 37,320
Sanmina /1/ 23,560 236,071
386,651
ELECTRONIC COMPONENTS-SEMICONDUCTOR (1.47%)
Altera /1/ 5,800 116,058
Conexant Systems /1/ 2,130 9,265
Fairchild Semiconductor International /1/ 1,723 33,547
Integrated Silicon Solution /1/ 534 7,332
Intel 27,698 712,670
International Rectifier /1/ 5,510 218,416
Microsemi /1/ 2,349 25,534
National Semiconductor /1/ 2,070 84,435
PMC - Sierra /1/ 3,321 40,350
Silicon Laboratories /1/ /2/ 418 19,709
Texas Instruments 8,374 210,187
1,477,503
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC CONNECTORS (0.16%)
$
Amphenol /1/ 4,938 156,090
ELECTRONIC FORMS (0.17%)
Adobe Systems 4,030 166,600
ELECTRONIC MEASUREMENT INSTRUMENTS (0.10%)
Agilent Technologies /1/ 2,940 79,409
Tektronix 590 17,464
96,873
ELECTRONIC PARTS DISTRIBUTION (0.34%)
Arrow Electronics /1/ 5,190 131,203
Avnet /1/ 9,628 208,350
339,553
ELECTRONICS-MILITARY (0.05%)
Engineered Support Systems 1,036 50,381
ENGINES-INTERNAL COMBUSTION (0.05%)
Briggs & Stratton 651 45,570
ENTERPRISE SOFTWARE & SERVICE (0.14%)
Ascential Software /1/ 593 10,081
BEA Systems /1/ 1,890 21,565
Hyperion Solutions /1/ 300 11,514
Micromuse /1/ 1,123 7,535
Mobius Management Systems /1/ 1,139 7,301
Oracle /1/ 3,820 42,861
SAP 1,175 43,804
144,661
ENTERTAINMENT SOFTWARE (0.01%)
Take-Two Interactive Software /1/ 184 5,316
ENVIRONMENTAL CONSULTING & ENGINEERING (0.01%)
Tetra Tech /1/ 654 10,863
FIDUCIARY BANKS (0.11%)
State Street 2,360 115,168
FILTRATION & SEPARATION PRODUCTS (0.03%)
CLARCOR 662 29,141
FINANCE-CONSUMER LOANS (0.03%)
Portfolio Recovery Associates /1/ /2/ 788 21,048
World Acceptance /1/ 594 9,088
30,136
FINANCE-CREDIT CARD (0.51%)
American Express 930 45,524
Capital One Financial 3,840 251,635
MBNA 8,660 211,131
508,290
FINANCE-INVESTMENT BANKER & BROKER (1.52%)
Goldman Sachs Group 3,550 342,575
Legg Mason 1,640 150,978
Lehman Brothers Holdings 2,956 216,970
Merrill Lynch 8,030 435,467
Morgan Stanley 5,715 293,694
Nomura Holdings 5,175 84,767
Raymond James Financial 247 6,205
1,530,656
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-MORTGAGE LOAN/BANKER (0.59%)
$
American Home Mortgage Investment 1,192 28,286
Doral Financial 4,113 134,865
Federal National Mortgage Association 5,740 394,453
New Century Financial 835 35,429
593,033
FINANCE-OTHER SERVICES (0.09%)
Chicago Mercantile Exchange /2/ 770 90,321
FINANCIAL GUARANTEE INSURANCE (0.26%)
Ambac Financial Group 3,810 262,890
FOOD-FLOUR & GRAIN (0.25%)
Archer Daniels Midland 14,090 247,420
FOOD-MISCELLANEOUS/DIVERSIFIED (0.36%)
Corn Products International 311 13,217
Kellogg 2,430 104,247
McCormick 1,530 52,265
Nestle 2,053 130,263
Unilever 976 64,348
364,340
FOOD-RETAIL (0.12%)
Tesco 6,162 82,571
Whole Foods Market 470 37,595
120,166
FOOD-WHOLESALE & DISTRIBUTION (0.15%)
Sysco 3,920 149,940
FOOTWEAR & RELATED APPAREL (0.02%)
Wolverine World Wide 557 14,972
GARDEN PRODUCTS (0.02%)
Toro 263 15,293
GAS-DISTRIBUTION (0.13%)
AGL Resources 635 18,161
Energen 1,237 51,150
New Jersey Resources 275 10,480
ONEOK 1,157 24,239
Southern Union /1/ 911 17,910
UGI 429 13,514
135,454
HOTELS & MOTELS (0.07%)
Choice Hotels International 274 12,303
InterContinental Hotels Group 4,987 47,526
LaSalle Hotel Properties 452 9,944
69,773
HUMAN RESOURCES (0.02%)
Korn/Ferry International /1/ 1,094 16,388
IMPORT & EXPORT (0.12%)
Mitsubishi 6,230 117,747
INDUSTRIAL AUTOMATION & ROBOTS (0.01%)
Cognex 325 10,329
INDUSTRIAL GASES (0.01%)
Airgas 671 14,863
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
INSTRUMENTS-CONTROLS (0.01%)
$
Thermo Electron /1/ 491 14,337
INSTRUMENTS-SCIENTIFIC (0.01%)
Dionex /1/ 261 13,319
INTERNET BROKERS (0.02%)
E*trade Group /1/ 1,807 20,528
INTERNET CONNECTIVE SERVICES (0.01%)
Hanaro Telecom /1/ 5,937 13,536
INTERNET FINANCIAL SERVICES (0.01%)
IndyMac Bancorp 277 8,908
INTERNET SECURITY (0.37%)
RSA Security /1/ 1,194 19,128
Symantec /1/ 7,820 352,291
371,419
INTIMATE APPAREL (0.01%)
Warnaco Group /1/ 455 8,704
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.07%)
Nuveen Investments 2,670 68,432
LEISURE & RECREATION PRODUCTS (0.14%)
Brunswick 3,380 138,952
LIFE & HEALTH INSURANCE (0.26%)
Lincoln National 4,900 219,912
Stancorp Financial Group 420 25,985
Universal American Financial /1/ 940 10,340
256,237
MACHINERY-CONSTRUCTION & MINING (0.10%)
Caterpillar 1,130 87,835
Joy Global 503 13,204
101,039
MACHINERY-FARM (0.30%)
Deere 4,470 304,139
MACHINERY-GENERAL INDUSTRY (0.16%)
Albany International 147 4,483
Gardner Denver /1/ 598 15,680
Ingersoll-Rand 2,140 138,137
158,300
MACHINERY-PUMPS (0.18%)
Graco 6,585 185,697
MEDICAL INSTRUMENTS (0.85%)
ArthroCare /1/ 679 15,963
Beckman Coulter 1,390 77,618
Boston Scientific /1/ 3,440 141,694
dj Orthopedics /1/ 318 7,323
Guidant 1,570 98,926
Medtronic 5,820 293,677
St. Jude Medical /1/ 2,776 211,698
Techne /1/ 195 7,597
854,496
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL LASER SYSTEMS (0.03%)
$
Candela /1/ 2,848 30,160
MEDICAL PRODUCTS (1.35%)
Becton Dickinson 2,600 131,430
Cooper /1/ 261 14,094
Henry Schein /1/ 430 30,302
INAMED /1/ 250 14,710
Johnson & Johnson 18,520 1,000,636
Varian Medical Systems /1/ 1,880 161,379
1,352,551
MEDICAL-BIOMEDICAL/GENE (0.54%)
Amgen /1/ 8,190 460,851
Celera Genomics Group /1/ 3,425 40,381
Enzo Biochem /1/ /2/ 741 10,781
Human Genome Sciences /1/ 1,675 20,435
Lexicon Genetics /1/ 2,114 14,925
547,373
MEDICAL-DRUGS (2.99%)
aaiPharma /1/ 475 3,021
Abbott Laboratories 4,190 184,444
Adolor /1/ 619 9,947
AstraZeneca 1,730 82,781
Bradley Pharmaceuticals /1/ 1,323 34,689
Bristol-Myers Squibb 1,300 32,630
Eli Lilly 1,400 103,334
Endo Pharmaceuticals Holdings /1/ 1,570 37,476
First Horizon Pharmaceutical /1/ 1,723 26,724
Forest Laboratories /1/ 2,400 154,752
GlaxoSmithKline 2,482 104,244
Hi-Tech Pharmacal /1/ 675 14,006
Ligand Pharmaceuticals /1/ 2,328 49,842
Merck 7,370 346,390
Novartis 3,645 163,296
Novo Nordisk 705 33,826
Pfizer 40,512 1,448,709
Roche Holding 450 47,138
Sanofi-Synthelabo 1,351 42,016
Teva Pharmaceutical Industries 940 57,866
Wyeth 780 29,695
3,006,826
MEDICAL-GENERIC DRUGS (0.48%)
Barr Laboratories /1/ 2,370 98,166
Eon Labs /1/ 1,300 85,475
Mylan Laboratories 3,140 71,937
Pharmaceutical Resources /1/ 3,700 149,110
Watson Pharmaceutical /1/ 2,280 81,191
485,879
MEDICAL-HMO (1.21%)
Aetna 1,890 156,398
AMERIGROUP /1/ 263 10,917
Anthem /1/ 1,790 158,558
Coventry Health Care /1/ 468 19,581
Pacificare Health Systems /1/ 2,250 80,460
UnitedHealth Group 7,650 470,322
WellChoice /1/ 3,668 155,523
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-HMO (CONTINUED)
$
Wellpoint Health Networks /1/ 1,440 160,834
1,212,593
MEDICAL-HOSPITALS (0.03%)
United Surgical Partners International /1/ 405 14,669
VCA Antech /1/ 334 13,657
28,326
MEDICAL-OUTPATIENT & HOME MEDICAL CARE (0.02%)
Apria Healthcare Group /1/ 673 19,409
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.10%)
Cardinal Health 1,400 102,550
METAL PROCESSORS & FABRICATION (0.11%)
Precision Castparts 1,930 86,869
Quanex 610 24,888
111,757
METAL-ALUMINUM (0.03%)
Alcoa 470 14,453
Century Aluminum /1/ 753 14,909
29,362
METAL-COPPER (0.03%)
Southern Peru Copper 875 25,401
MISCELLANEOUS INVESTING (0.49%)
Capital Automotive 987 27,764
CBL & Associates Properties 775 38,944
Chelsea Property Group 763 38,913
Entertainment Properties Trust 868 29,043
Federal Realty Investment Trust 551 20,431
General Growth Properties 3,130 84,854
Health Care 537 17,152
Kimco Realty 2,040 87,190
Macerich 861 36,050
Newcastle Investment 1,499 40,053
PS Business Parks 317 12,030
SL Green Realty /2/ 586 23,909
Thornburg Mortgage 822 21,273
Ventas 661 14,602
492,208
MISCELLANEOUS MANUFACTURERS (0.01%)
Applied Films /1/ 385 9,163
MONEY CENTER BANKS (2.17%)
ABN AMRO Holding 4,990 106,087
Bank of America 11,837 952,760
Barclays 4,552 166,512
BNP Paribas 5,500 164,175
Credit Suisse Group /1/ 3,710 129,702
HSBC Holdings 427 30,787
ICICI Bank 3,200 49,600
JP Morgan Chase 10,670 401,192
Mitsubishi Tokyo Financial Group 7,655 68,129
UBS 1,621 114,767
2,183,711
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MOTORCYCLE & MOTOR SCOOTER (0.22%)
$
Harley-Davidson 3,940 221,901
MULTI-LINE INSURANCE (2.04%)
Allstate 8,633 396,255
American International Group 10,400 745,160
AXA 3,146 64,776
Hartford Financial Services 4,930 301,124
ING Groep 2,883 61,177
MetLife 4,370 150,765
Prudential Financial 5,843 256,742
Zurich Financial Services /1/ 4,900 77,420
2,053,419
MULTIMEDIA (1.14%)
Belo 2,940 83,672
Gannett 2,090 181,161
Gemstar-TV Guide International /1/ 5,385 30,102
Journal Communications 512 9,042
McGraw-Hill 1,950 153,777
Media General 1,818 130,678
Meredith 1,710 87,108
News 5,122 187,260
Time Warner /1/ 6,020 101,257
Viacom 2,080 80,392
Vivendi Universal /1/ 2,759 68,203
Walt Disney 1,280 29,478
1,142,130
NETWORKING PRODUCTS (0.99%)
Cisco Systems /1/ 45,920 958,350
Emulex /1/ 830 13,836
Foundry Networks /1/ 2,299 25,979
998,165
OFFICE AUTOMATION & EQUIPMENT (0.11%)
Canon 1,667 87,201
Imagistics International /1/ 630 25,509
112,710
OFFICE FURNISHINGS-ORIGINAL (0.03%)
HON Industries 889 32,902
OFFICE SUPPLIES & FORMS (0.02%)
John H. Harland 726 22,368
OIL COMPANY-EXPLORATION & PRODUCTION (1.18%)
Burlington Resources 4,320 290,606
Canadian Natural Resources 1,220 67,210
Chesapeake Energy 18,123 249,191
Cimarex Energy /1/ 1,700 46,903
Denbury Resources /1/ 467 8,527
Devon Energy 2,390 146,268
Houston Exploration /1/ 408 18,254
KCS Energy /1/ 2,251 27,057
Meridian Resource /1/ /2/ 2,830 18,508
Noble Energy 864 39,830
Nuevo Energy /1/ 1,372 47,334
PetroKazakhstan 1,228 32,923
Pogo Producing 2,248 110,871
Talisman Energy 630 35,866
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL COMPANY-EXPLORATION & PRODUCTION (CONTINUED)
$
Unit /1/ 1,026 28,985
Vintage Petroleum 1,350 20,345
1,188,678
OIL COMPANY-INTEGRATED (2.86%)
BP Amoco 593 31,370
ChevronTexaco 5,716 523,014
ConocoPhillips 4,540 323,702
ENI 1,155 117,671
Exxon Mobil 27,058 1,151,318
Marathon Oil 5,100 171,156
Occidental Petroleum 5,196 245,251
Petro-Canada 592 26,178
Petroleo Brasileiro 1,170 33,813
Repsol YPF 5,290 110,455
TotalFinaElf 1,555 143,247
2,877,175
OIL FIELD MACHINERY & EQUIPMENT (0.05%)
FMC Technologies /1/ 646 17,603
Universal Compression Holdings /1/ 1,021 30,385
47,988
OIL REFINING & MARKETING (0.08%)
Statoil 6,200 78,120
OPTICAL SUPPLIES (0.21%)
Advanced Medical Optics /1/ 706 22,267
Bausch & Lomb 3,044 191,255
213,522
PAPER & RELATED PRODUCTS (0.44%)
Boise Cascade 344 11,603
Georgia-Pacific 3,420 120,042
Louisiana-Pacific 5,960 140,596
Temple-Inland 540 33,356
UPM-Kymmene Oyj 2,396 44,015
Weyerhaeuser 1,610 95,312
444,924
PHYSICIAN PRACTICE MANAGEMENT (0.02%)
US Oncology /1/ 1,028 15,317
PIPELINES (0.37%)
Kinder Morgan 2,410 145,106
Questar 6,356 225,447
370,553
POULTRY (0.02%)
Tyson Foods 916 17,166
POWER CONVERTER & SUPPLY EQUIPMENT (0.07%)
Hubbell 1,560 70,106
PRINTING-COMMERCIAL (0.04%)
Banta 670 29,802
Consolidated Graphics /1/ 386 14,405
44,207
PRIVATE CORRECTIONS (0.03%)
Corrections Corp. of America /1/ 779 28,387
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PROPERTY & CASUALTY INSURANCE (0.20%)
$
Arch Capital Group /1/ 642 25,796
Fidelity National Financial 689 25,217
First American 609 16,516
Infinity Property & Casualty 1,207 37,538
Navigators Group /1/ 699 18,209
Selective Insurance Group 400 14,304
Stewart Information Services 442 15,691
W.R. Berkley 1,237 50,098
203,369
PUBLICLY TRADED INVESTMENT FUND (0.31%)
iShares MSCI Emerging Markets Index
Fund 710 112,393
iShares MSCI Japan Index Fund 16,400 166,296
iShares Russell 1000 Value Index Fund 550 32,010
310,699
RACETRACKS (0.02%)
Penn National Gaming /1/ 553 16,308
REGIONAL BANKS (1.39%)
Bank One 1,560 77,017
National City 4,720 163,643
U.S. Bancorp 7,206 184,762
Wachovia 11,360 519,720
Wells Fargo 8,068 455,519
1,400,661
REINSURANCE (0.03%)
Converium Holding 1,290 33,540
RENTAL-AUTO & EQUIPMENT (0.02%)
Rent-A-Center /1/ 705 20,635
RESPIRATORY PRODUCTS (0.09%)
Respironics /1/ 1,668 87,420
RETAIL-APPAREL & SHOE (0.44%)
Aeropostale /1/ 678 14,909
bebe Stores /1/ /2/ 358 11,420
Burlington Coat Factory Warehouse 477 9,044
Claire's Stores 2,210 45,040
Foot Locker 1,767 42,408
Gap 7,470 164,415
Genesco /1/ 345 7,676
Kenneth Cole Productions 670 23,175
Nordstrom 2,170 77,317
Pacific Sunwear of California /1/ 2,370 50,884
446,288
RETAIL-ARTS & CRAFTS (0.14%)
Michaels Stores 2,870 143,586
RETAIL-AUTO PARTS (0.02%)
CSK Auto /1/ 980 18,091
RETAIL-BEDDING (0.17%)
Bed Bath & Beyond /1/ 4,590 170,381
RETAIL-BOOKSTORE (0.09%)
Barnes & Noble /1/ 1,606 47,971
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-BOOKSTORE (CONTINUED)
$
Borders Group 1,568 37,585
85,556
RETAIL-BUILDING PRODUCTS (0.39%)
Home Depot 9,440 332,194
Lowe's 1,100 57,266
389,460
RETAIL-CONSUMER ELECTRONICS (0.37%)
Best Buy 6,780 367,815
RETAIL-DISCOUNT (1.26%)
Target 3,170 137,483
Wal-Mart Stores 19,860 1,132,020
1,269,503
RETAIL-DRUG STORE (0.30%)
CVS 3,650 141,000
Rite Aid /1/ 32,400 158,760
299,760
RETAIL-HAIR SALONS (0.04%)
Regis 1,006 43,681
RETAIL-JEWELRY (0.06%)
Tiffany 1,170 45,630
Zale /1/ 227 12,694
58,324
RETAIL-MAJOR DEPARTMENT STORE (0.08%)
May Department Stores 2,510 77,308
RETAIL-MUSIC STORE (0.02%)
Guitar Center /1/ 384 15,944
RETAIL-OFFICE SUPPLIES (0.16%)
Staples 6,200 159,712
RETAIL-REGIONAL DEPARTMENT STORE (0.49%)
Dillards 2,720 45,778
Federated Department Stores 6,380 312,620
Neiman Marcus Group 2,680 130,355
488,753
RETAIL-RESTAURANTS (0.70%)
CBRL Group 936 35,147
McDonald's 13,320 362,704
Ruby Tuesday 438 13,105
Wendy's International 2,860 111,540
Yum! Brands /1/ 4,560 176,882
699,378
RETAIL-SPORTING GOODS (0.05%)
Sports Authority /1/ 1,242 47,618
RETAIL-VIDEO RENTAL (0.03%)
Movie Gallery 1,401 27,207
RUBBER-TIRES (0.01%)
Bandag 328 14,284
SAVINGS & LOANS-THRIFTS (0.21%)
FirstFed Financial /1/ 307 12,409
Independence Community Bank 4,617 168,197
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
SAVINGS & LOANS-THRIFTS (CONTINUED)
$
PFF Bancorp 489 18,313
Sterling Financial /1/ 381 12,577
211,496
SCHOOLS (0.20%)
Apollo Group /1/ 1,910 173,581
Strayer Education 190 23,744
197,325
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (0.43%)
Exar /1/ 600 9,156
Linear Technology 3,775 134,503
Maxim Integrated Products 2,455 112,905
Micrel /1/ 1,340 16,375
Taiwan Semiconductor Manufacturing /1/ 6,872 65,490
United Microelectronics /1/ /2/ 13,788 71,698
Vitesse Semiconductor /1/ 4,427 18,948
429,075
SEMICONDUCTOR EQUIPMENT (0.30%)
Applied Materials /1/ 7,990 145,658
Brooks Automation /1/ 343 5,708
Mykrolis /1/ 610 8,875
Novellus Systems /1/ 2,910 84,274
Ultratech /1/ 1,277 20,572
Varian Semiconductor Equipment Associates /1/ 955 31,095
Veeco Instruments /1/ 308 7,007
303,189
STEEL PRODUCERS (0.09%)
POSCO 1,972 60,639
Schnitzer Steel Industries 1,005 26,401
87,040
STEEL-SPECIALTY (0.01%)
Gibraltar Steel 263 6,470
TELECOMMUNICATION EQUIPMENT (0.23%)
Adtran 786 19,265
Comtech Telecommunications /1/ 291 4,708
Ditech Communications /1/ 1,910 27,466
Plantronics /1/ 607 23,036
Qualcomm 460 28,731
Tekelec /1/ 748 12,469
Telefonaktiebolaget LM Ericsson /1/ 3,830 102,146
Westell Technologies /1/ 2,128 15,573
233,394
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.03%)
C-COR.net /1/ 2,357 21,402
Sycamore Networks /1/ 1,439 5,324
26,726
TELECOMMUNICATION SERVICES (0.33%)
Allstream 1,600 86,098
Amdocs /1/ 2,210 58,675
Aspect Communications /1/ 2,379 28,144
Cable & Wireless /1/ 7,226 46,102
Level 3 Communications /1/ /2/ 15,110 42,761
MasTec /1/ 3,511 25,736
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TELECOMMUNICATION SERVICES (CONTINUED)
$
PTEK Holdings /1/ 4,478 45,541
333,057
TELEPHONE-INTEGRATED (1.08%)
BellSouth 4,520 116,661
CenturyTel 4,020 116,097
Deutsche Telekom /1/ 6,560 112,045
IDT /1/ 2,040 37,822
Nippon Telegraph & Telephone 1,630 42,331
NTL /1/ 271 15,385
SBC Communications 4,190 104,331
Sprint 355 6,351
Telephone & Data Systems 121 7,981
Verizon Communications 14,005 528,549
1,087,553
TELEVISION (0.06%)
Hearst-Argyle Television 2,340 61,425
THERAPEUTICS (0.16%)
Corixa /1/ 1,556 9,103
Gilead Sciences /1/ 2,050 124,701
Onyx Pharmaceuticals /1/ 299 14,747
Tanox /1/ 582 9,923
158,474
TOBACCO (0.49%)
Altria Group 5,526 306,030
British American Tobacco 1,846 56,764
Imperial Tobacco Group 1,810 80,907
Universal 982 49,336
493,037
TOOLS-HAND HELD (0.10%)
Black & Decker 1,760 101,816
TOYS (0.19%)
Hasbro 10,208 192,829
TRANSACTIONAL SOFTWARE (0.03%)
Transaction Systems Architects /1/ 1,477 31,357
TRANSPORT-SERVICES (0.35%)
FedEx 3,200 230,112
Offshore Logistics /1/ 423 9,285
United Parcel Service 1,530 107,329
346,726
TRANSPORT-TRUCK (0.04%)
Heartland Express 476 11,686
J.B. Hunt Transport Services /1/ 469 14,848
Yellow Roadway /1/ 539 18,353
44,887
TRUCKING & LEASING (0.02%)
Ryder System 487 17,917
VITAMINS & NUTRITION PRODUCTS (0.02%)
USANA Health Sciences /1/ 646 17,410
WEB PORTALS (0.12%)
United Online /1/ 1,964 32,602
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
WEB PORTALS (CONTINUED)
$
Yahoo /1/ 1,660 83,764
116,366
WIRELESS EQUIPMENT (0.28%)
Motorola 14,030 256,047
SBA Communications /1/ 3,484 13,936
SpectraLink 1,003 12,638
282,621
TOTAL COMMON STOCKS 64,033,652
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
PREFERRED STOCKS (0.08%)
CABLE TV (0.08%)
Cablevision Systems 750 78,375
TOTAL PREFERRED STOCKS 78,375
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (22.89%)
AEROSPACE & DEFENSE (0.06%)
Raytheon
$ $
4.85%; 01/15/11 60,000 59,737
AEROSPACE & DEFENSE EQUIPMENT (0.04%)
K&F Industries
9.25%; 10/15/07 35,000 36,225
AGRICULTURAL OPERATIONS (0.15%)
Bunge Limited Finance
4.38%; 12/15/08 /3/ 80,000 79,723
5.35%; 04/15/14 /3/ 45,000 43,821
5.88%; 05/15/13 25,000 25,443
148,987
AIRLINES (0.23%)
Northwest Airlines
7.58%; 09/01/20 56,290 56,958
Southwest Airlines
5.10%; 05/01/06 172,147 177,972
234,930
ASSET BACKED SECURITIES (0.59%)
Chase Funding Mortgage Loan
3.07%; 08/25/17 20,988 20,971
Chase Funding Mortgage Loan Asset Backed Certificates
/4/
1.39%; 09/25/33 100,000 100,000
Countrywide Asset Backed Certificates /4/
1.60%; 02/25/34 196,429 196,650
2.17%; 01/25/34 180,000 180,359
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
ASSET BACKED SECURITIES (CONTINUED)
Master Adjustable Rate Mortgages Trust
/4/
$ $
2.20%; 03/25/34 95,000 95,709
593,689
AUTO-CARS & LIGHT TRUCKS (0.25%)
DaimlerChrysler Holding
4.05%; 06/04/08 70,000 68,759
4.75%; 01/15/08 15,000 15,217
7.25%; 01/18/06 40,000 42,859
Ford Motor
7.45%; 07/16/31 55,000 53,617
General Motors
8.25%; 07/15/23 40,000 42,807
Hyundai Motor Manufacturing /3/
5.30%; 12/19/08 25,000 24,915
248,174
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.03%)
Navistar International
8.00%; 02/01/08 25,000 25,688
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.05%)
Lear
7.96%; 05/15/05 45,000 47,363
AUTOMOBILE SEQUENTIAL (0.20%)
Ford Credit Auto Owner Trust
4.72%; 12/15/05 200,000 202,679
BEVERAGES-NON-ALCOHOLIC (0.03%)
Coca-Cola Enterprises
5.25%; 05/15/07 25,000 26,513
BEVERAGES-WINE & SPIRITS (0.15%)
Diageo Capital /4/
1.24%; 04/20/07 150,000 149,874
BREWERY (0.13%)
Cia Brasileira de Bebidas
10.50%; 12/15/11 40,000 45,800
Coors Brewing
6.38%; 05/15/12 50,000 53,985
SABMiller /3/
6.63%; 08/15/33 30,000 31,251
131,036
BROADCASTING SERVICES & PROGRAMMING (0.18%)
Clear Channel Communications
5.75%; 01/15/13 65,000 66,461
Grupo Televisa
8.50%; 03/11/32 20,000 21,100
Liberty Media
3.50%; 09/25/06 60,000 60,116
5.70%; 05/15/13 35,000 34,997
182,674
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.33%)
CRH America
5.30%; 10/15/13 25,000 24,816
6.40%; 10/15/33 25,000 24,966
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (CONTINUED)
CRH America (continued)
$ $
6.95%; 03/15/12 35,000 38,966
Masco
1.37%; 03/09/07 /3/ /4/ 110,000 109,955
5.88%; 07/15/12 35,000 36,648
6.00%; 05/03/04 100,000 100,000
335,351
BUILDING PRODUCTS-AIR & HEATING (0.08%)
York International
6.63%; 08/15/06 75,000 79,633
BUILDING PRODUCTS-WOOD (0.04%)
Celulosa Arauco y Constitucion
5.13%; 07/09/13 15,000 14,235
Riverside Forest Products /3/
7.88%; 03/01/14 25,000 25,812
40,047
BUILDING-RESIDENTIAL & COMMERCIAL (0.13%)
DR Horton
8.50%; 04/15/12 50,000 56,125
KB Home
7.75%; 02/01/10 45,000 47,025
Technical Olympic USA /3/
7.50%; 03/15/11 25,000 24,000
127,150
CABLE TV (0.52%)
Charter Communications Operating /3/
8.00%; 04/30/12 75,000 73,875
Comcast
5.30%; 01/15/14 5,000 4,881
5.50%; 03/15/11 155,000 158,802
5.85%; 01/15/10 5,000 5,250
7.05%; 03/15/33 35,000 36,820
Comcast Cable Communications
6.75%; 01/30/11 25,000 27,397
Cox Communications
4.63%; 06/01/13 15,000 13,960
5.50%; 10/01/15 20,000 19,471
6.75%; 03/15/11 125,000 136,574
EchoStar DBS
10.38%; 10/01/07 40,000 43,250
520,280
CASINO HOTELS (0.23%)
Aztar
8.88%; 05/15/07 60,000 61,950
Mandalay Resort Group
6.45%; 02/01/06 25,000 26,125
MGM Mirage
6.00%; 10/01/09 20,000 20,250
7.25%; 10/15/06 35,000 37,537
8.50%; 09/15/10 25,000 28,187
Park Place Entertainment
8.50%; 11/15/06 40,000 43,800
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
CASINO HOTELS (CONTINUED)
Station Casinos /3/
$ $
6.00%; 04/01/12 15,000 14,888
232,737
CASINO SERVICES (0.04%)
International Game Technology
8.38%; 05/15/09 35,000 40,983
CELLULAR TELECOMMUNICATIONS (0.42%)
AT&T Wireless Services
7.88%; 03/01/11 65,000 74,868
8.13%; 05/01/12 65,000 75,815
Nextel Communications
9.38%; 11/15/09 40,000 43,250
Rogers Wireless Communications /3/
6.38%; 03/01/14 75,000 70,500
Rural Cellular /3/
8.25%; 03/15/12 20,000 20,650
Telus
7.50%; 06/01/07 40,000 44,202
8.00%; 06/01/11 10,000 11,600
U.S. Cellular
6.70%; 12/15/33 10,000 9,770
Verizon Wireless Capital
5.38%; 12/15/06 65,000 68,589
419,244
CHEMICALS-DIVERSIFIED (0.12%)
Chevron Phillips Chemical
7.00%; 03/15/11 50,000 55,162
ICI Wilmington I
5.63%; 12/01/13 30,000 29,944
Lyondell Chemical
9.88%; 05/01/07 35,000 36,750
121,856
CIRCUIT BOARDS (0.04%)
Jabil Circuit
5.88%; 07/15/10 40,000 41,545
COAL (0.07%)
Massey Energy
6.63%; 11/15/10 30,000 30,150
Peabody Energy
6.88%; 03/15/13 40,000 41,600
71,750
COATINGS & PAINT (0.03%)
Valspar
6.00%; 05/01/07 25,000 26,715
COMMERCIAL BANKS (0.05%)
Union Planters Bank
5.13%; 06/15/07 50,000 53,234
COMMERCIAL SERVICE-FINANCE (0.05%)
Dollar Financial Group
9.75%; 11/15/11 50,000 53,750
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
COMPUTER SERVICES (0.10%)
Sungard Data Systems /3/
$ $
4.88%; 01/15/14 25,000 24,017
Unisys
7.88%; 04/01/08 35,000 35,875
8.13%; 06/01/06 35,000 37,975
97,867
COMPUTERS-INTEGRATED SYSTEMS (0.02%)
NCR
7.13%; 06/15/09 15,000 16,571
CONSUMER PRODUCTS-MISCELLANEOUS (0.13%)
American Greetings
6.10%; 08/01/28 50,000 52,250
Fortune Brands /3/
7.13%; 11/01/04 75,000 76,981
129,231
CONTAINERS-PAPER & PLASTIC (0.04%)
Norampac
6.75%; 06/01/13 40,000 41,600
COSMETICS & TOILETRIES (0.03%)
Elizabeth Arden /3/
7.75%; 01/15/14 25,000 25,844
CREDIT CARD ASSET BACKED SECURITIES (0.82%)
American Express Credit Account Master Trust
5.53%; 10/15/08 500,000 528,026
Capital One Multi-Asset Execution
Trust /4/
1.32%; 12/15/09 95,000 95,079
Chase Credit Card Master Trust /4/
1.30%; 05/15/09 100,000 100,000
MBNA Credit Card Master Note Trust
3.90%; 11/15/07 100,000 102,175
825,280
DATA PROCESSING & MANAGEMENT (0.02%)
Certegy
4.75%; 09/15/08 15,000 15,266
DIVERSIFIED FINANCIAL SERVICES (0.25%)
Citigroup
5.88%; 02/22/33 20,000 19,053
6.63%; 06/15/32 50,000 52,464
General Electric Capital
6.75%; 03/15/32 90,000 96,895
John Deere Capital
3.13%; 12/15/05 40,000 40,541
NiSource Finance
3.20%; 11/01/06 40,000 40,006
248,959
DIVERSIFIED MANUFACTURING OPERATIONS (0.08%)
Tyco International Group
6.00%; 11/15/13 /3/ 35,000 35,480
6.38%; 02/15/06 40,000 42,142
77,622
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
DIVERSIFIED MINERALS (0.05%)
Corp. Nacional del Cobre de Chile /3/
$ $
5.50%; 10/15/13 20,000 19,897
Vale Overseas
9.00%; 08/15/13 25,000 26,094
45,991
DIVERSIFIED OPERATIONS (0.05%)
Hutchison Whampoa International /3/
6.50%; 02/13/13 50,000 50,365
E-COMMERCE-PRODUCTS (0.02%)
FTD /3/
7.75%; 02/15/14 25,000 24,750
ELECTRIC-GENERATION (0.04%)
Korea East-West Power /3/
4.88%; 04/21/11 15,000 14,687
Tenaska Virginia Partners /3/
6.12%; 03/30/24 30,000 30,000
44,687
ELECTRIC-INTEGRATED (1.63%)
Alabama Power
5.70%; 02/15/33 10,000 9,354
Appalachian Power
5.95%; 05/15/33 15,000 14,054
Arizona Public Service
6.50%; 03/01/12 20,000 21,517
Carolina Power & Light
6.65%; 04/01/08 40,000 43,473
Centerpoint Energy
5.88%; 06/01/08 25,000 25,461
7.25%; 09/01/10 30,000 31,991
Cincinnati Gas & Electric
5.40%; 06/15/33 15,000 13,151
Consolidated Edison
3.63%; 08/01/08 25,000 24,719
Consumers Energy
4.25%; 04/15/08 10,000 9,995
6.00%; 03/15/05 35,000 35,975
Dayton Power & Light /3/
5.13%; 10/01/13 30,000 28,944
Duke Energy /4/
1.49%; 01/15/05 130,000 130,113
Entergy Gulf States
3.60%; 06/01/08 25,000 24,204
Exelon
6.75%; 05/01/11 30,000 33,118
FirstEnergy
6.45%; 11/15/11 55,000 57,904
FPL Energy Wind Funding /3/
6.88%; 06/27/17 100,000 100,500
FPL Group Capital
3.25%; 04/11/06 25,000 25,271
Georgia Power /4/
1.30%; 02/17/09 130,000 129,865
Indianapolis Power & Light
7.38%; 08/01/07 35,000 38,540
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
ELECTRIC-INTEGRATED (CONTINUED)
Jersey Central Power & Light /3/
$ $
5.63%; 05/01/16 15,000 14,851
MidAmerican Energy Holdings
6.75%; 12/30/31 50,000 53,735
MSW Energy /3/
7.38%; 09/01/10 50,000 51,750
Niagara Mohawk Power
5.38%; 10/01/04 50,000 50,782
Northeast Utilities
3.30%; 06/01/08 20,000 19,213
Ohio Power
4.85%; 01/15/14 20,000 19,278
Oncor Electric Delivery
6.38%; 05/01/12 45,000 48,754
Pacific Gas & Electric
3.60%; 03/01/09 25,000 24,250
6.05%; 03/01/34 85,000 80,385
Pepco Holdings
3.75%; 02/15/06 80,000 81,167
4.00%; 05/15/10 10,000 9,524
Power Contract Financing /3/
5.20%; 02/01/06 21,826 22,155
PSI Energy
5.00%; 09/15/13 30,000 29,274
Puget Energy
3.36%; 06/01/08 25,000 23,939
SCANA /4/
1.57%; 11/15/06 110,000 110,053
Southern California Edison
5.00%; 01/15/14 15,000 14,716
8.00%; 02/15/07 40,000 44,849
Southwestern Electric Power
4.50%; 07/01/05 50,000 51,231
TXU Energy
6.13%; 03/15/08 20,000 21,333
Virginia Electric & Power
4.50%; 12/15/10 35,000 34,503
Westar Energy
8.50%; 07/01/22 35,000 36,050
1,639,941
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.05%)
Flextronics International
6.50%; 05/15/13 50,000 50,625
ELECTRONICS-MILITARY (0.08%)
L-3 Communications
8.00%; 08/01/08 80,000 83,700
FEDERAL & FEDERALLY SPONSORED CREDIT (0.06%)
Housing Urban Development
2.99%; 08/01/05 60,000 60,827
FINANCE-AUTO LOANS (0.44%)
Ford Motor Credit
5.80%; 01/12/09 35,000 35,648
6.13%; 01/09/06 35,000 36,482
6.50%; 01/25/07 20,000 21,209
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-AUTO LOANS (CONTINUED)
Ford Motor Credit (continued)
$ $
6.88%; 02/01/06 125,000 132,310
7.38%; 02/01/11 50,000 53,466
7.88%; 06/15/10 25,000 27,465
General Motors Acceptance
6.88%; 09/15/11 50,000 52,481
8.00%; 11/01/31 45,000 47,494
Toyota Motor Credit
2.80%; 01/18/06 35,000 35,483
442,038
FINANCE-COMMERCIAL (0.02%)
CIT Group
4.75%; 12/15/10 20,000 19,824
FINANCE-CONSUMER LOANS (0.31%)
Household Finance
4.75%; 07/15/13 20,000 19,110
5.75%; 01/30/07 210,000 223,647
SLM
5.38%; 05/15/14 65,000 64,866
307,623
FINANCE-CREDIT CARD (0.11%)
Capital One Bank
6.88%; 02/01/06 100,000 106,613
FINANCE-INVESTMENT BANKER & BROKER (0.99%)
Bear Stearns
1.47%; 01/30/09 /4/ 130,000 130,237
1.67%; 06/25/34 /4/ /5/ 70,000 70,000
3.00%; 03/30/06 40,000 40,241
4.00%; 01/31/08 45,000 45,376
Credit Suisse First Boston
3.88%; 01/15/09 25,000 24,673
Goldman Sachs Group
3.88%; 01/15/09 35,000 34,459
6.60%; 01/15/12 170,000 186,151
Lehman Brothers Holdings
1.27%; 04/20/07 /4/ 90,000 89,923
4.80%; 03/13/14 50,000 47,739
Merrill Lynch
1.38%; 02/06/09 /4/ 130,000 130,041
4.50%; 11/04/10 35,000 34,737
Morgan Stanley
4.25%; 05/15/10 20,000 19,698
4.75%; 04/01/14 45,000 42,043
5.30%; 03/01/13 25,000 24,986
6.75%; 04/15/11 70,000 77,329
997,633
FINANCE-LEASING COMPANY (0.11%)
Boeing Capital
7.10%; 09/27/05 100,000 106,486
FINANCE-MORTGAGE LOAN/BANKER (1.75%)
Countrywide Home Loan
4.00%; 03/22/11 55,000 51,910
4.25%; 12/19/07 25,000 25,411
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-MORTGAGE LOAN/BANKER (CONTINUED)
Countrywide Home Loan (continued)
$ $
4.64%; 12/19/33 /4/ 200,000 194,388
5.25%; 06/15/04 100,000 100,439
Federal Home Loan Mortgage
3.25%; 02/25/08 225,000 221,297
4.75%; 10/11/12 80,000 78,077
4.75%; 05/06/13 75,000 72,716
5.13%; 11/07/13 20,000 19,681
6.75%; 03/15/31 256,000 288,834
Federal National Mortgage Association
2.88%; 05/19/08 50,000 48,272
3.70%; 11/01/07 230,000 231,005
3.75%; 07/29/05 175,000 175,886
4.32%; 07/26/07 90,000 92,386
4.75%; 02/21/13 75,000 72,862
7.25%; 05/15/30 70,000 83,654
1,756,818
FOOD-DAIRY PRODUCTS (0.05%)
Dean Foods
6.63%; 05/15/09 40,000 42,700
8.15%; 08/01/07 5,000 5,537
48,237
FOOD-MISCELLANEOUS/DIVERSIFIED (0.32%)
Cadbury Schweppes US Finance /3/
3.88%; 10/01/08 40,000 39,576
ConAgra Foods
7.50%; 09/15/05 75,000 80,007
Corn Products International
8.45%; 08/15/09 40,000 46,000
General Mills
6.00%; 02/15/12 30,000 31,808
Kraft Foods
4.63%; 11/01/06 85,000 87,912
6.25%; 06/01/12 35,000 37,491
322,794
FOOD-RETAIL (0.17%)
Delhaize America
7.38%; 04/15/06 45,000 48,100
Kroger
6.20%; 06/15/12 25,000 26,551
7.50%; 04/01/31 20,000 22,304
Safeway
5.80%; 08/15/12 70,000 71,909
168,864
GOLD MINING (0.01%)
Placer Dome
6.38%; 03/01/33 4,000 3,996
6.45%; 10/15/35 10,000 9,997
13,993
HOME DECORATION PRODUCTS (0.02%)
Newell Rubbermaid
4.00%; 05/01/10 10,000 9,537
4.63%; 12/15/09 15,000 14,971
24,508
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
HOME EQUITY-OTHER (0.51%)
Asset Backed Funding Certificates /4/ /5/
$ $
1.29%; 12/25/33 45,000 45,000
Long Beach Mortgage Loan Trust /4/ /5/
1.63%; 06/25/34 25,000 25,000
2.18%; 06/25/34 30,000 30,000
New Century Home Equity Loan Trust /4/
1.82%; 01/25/34 115,000 115,518
Option One Mortgage Loan Trust /4/ /5/
1.63%; 05/25/34 70,000 70,000
2.15%; 05/25/34 70,000 70,000
Specialty Underwriting & Residential Finance /4/
1.61%; 02/25/35 65,000 65,000
Wells Fargo Home Equity Trust /4/
1.60%; 04/25/34 90,000 90,002
510,520
HOME EQUITY-SEQUENTIAL (0.14%)
Ameriquest Mortgage Securities /4/
1.29%; 04/25/34 75,000 75,000
Residential Asset Securities
4.59%; 10/25/26 67,881 68,750
143,750
HOME FURNISHINGS (0.07%)
Sealy Mattress /3/
8.25%; 06/15/14 70,000 68,250
HOTELS & MOTELS (0.07%)
Extended Stay America
9.15%; 03/15/08 70,000 72,450
INDEPENDENT POWER PRODUCER (0.05%)
NRG Energy /3/
8.00%; 12/15/13 50,000 50,375
INSTRUMENTS-CONTROLS (0.02%)
Parker Hannifin
4.88%; 02/15/13 20,000 19,647
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.03%)
AMVESCAP
5.38%; 02/27/13 10,000 9,600
5.90%; 01/15/07 20,000 21,338
30,938
LIFE & HEALTH INSURANCE (0.04%)
Lincoln National
5.25%; 06/15/07 25,000 26,633
Nationwide Financial Services
5.63%; 02/13/15 10,000 10,199
36,832
MEDICAL PRODUCTS (0.18%)
Hanger Orthopedic Group
10.38%; 02/15/09 50,000 55,750
VWR International /3/
6.88%; 04/15/12 40,000 41,300
8.00%; 04/15/14 80,000 83,200
180,250
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MEDICAL-DRUGS (0.13%)
Eli Lilly
$ $
5.50%; 07/15/06 60,000 63,657
Schering-Plough
5.30%; 12/01/13 30,000 29,952
Wyeth
6.45%; 02/01/24 35,000 34,953
128,562
MEDICAL-HMO (0.21%)
Anthem
4.88%; 08/01/05 200,000 206,286
MEDICAL-HOSPITALS (0.11%)
HCA
6.95%; 05/01/12 50,000 52,238
7.13%; 06/01/06 10,000 10,633
Triad Hospitals
8.75%; 05/01/09 40,000 44,350
107,221
METAL PROCESSORS & FABRICATION (0.08%)
Mueller Group /3/
10.00%; 05/01/12 75,000 78,562
METAL-DIVERSIFIED (0.13%)
Falconbridge
5.38%; 06/01/15 10,000 9,695
7.35%; 06/05/12 15,000 16,872
Noranda
7.25%; 07/15/12 50,000 55,736
Rio Tinto Finance
5.75%; 07/03/06 50,000 52,998
135,301
MISCELLANEOUS INVESTING (0.11%)
CenterPoint Properties Trust
4.75%; 08/01/10 30,000 29,772
iStar Financial /3/
4.88%; 01/15/09 45,000 43,819
United Dominion Realty Trust
6.50%; 06/15/09 30,000 32,571
106,162
MISCELLANEOUS MANUFACTURERS (0.02%)
Aearo /3/
8.25%; 04/15/12 20,000 20,500
MONEY CENTER BANKS (0.24%)
Bank of America
4.88%; 09/15/12 60,000 59,352
7.40%; 01/15/11 110,000 126,488
JP Morgan Chase
4.50%; 11/15/10 35,000 34,525
United Overseas Bank /3/
4.50%; 07/02/13 20,000 18,616
238,981
MORTGAGE BACKED SECURITIES (1.62%)
Bear Stearns Commercial Mortgage Securities /3/ /4/
0.72%; 05/11/39 475,000 14,107
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MORTGAGE BACKED SECURITIES (CONTINUED)
Credit Suisse First Boston Mortgage Securities /4/ /5/
$ $
1.70%; 05/25/34 50,000 50,000
DLJ Commercial Mortgage
6.59%; 02/18/31 700,000 765,513
DLJ Mortgage Acceptance /3/
6.99%; 10/15/30 100,000 108,455
Greenwich Capital Commercial
Funding /4/
0.55%; 05/10/11 1,483,000 29,882
JP Morgan Chase Commercial Mortgage Securities
1.22%; 01/12/39 /3/ /4/ 650,000 37,154
6.04%; 11/15/35 150,000 161,196
LB-UBS Commercial Mortgage Trust
0.15%; 03/01/36 /3/ /4/ 358,580 9,568
0.87%; 03/15/34 /3/ /4/ 708,201 17,743
1.41%; 03/15/36 /3/ /4/ 422,905 23,964
5.97%; 03/15/26 325,000 348,498
Merrill Lynch Mortgage Trust /4/
0.76%; 02/12/42 1,471,015 39,878
Morgan Stanley Capital I /3/ /4/
1.12%; 01/13/41 425,000 24,079
1,630,037
MULTI-LINE INSURANCE (0.15%)
Metropolitan Life Global Funding I /3/ /4/
1.26%; 03/17/09 130,000 129,943
Safeco
4.88%; 02/01/10 25,000 25,594
155,537
MULTIMEDIA (0.43%)
AOL Time Warner
5.63%; 05/01/05 20,000 20,726
6.15%; 05/01/07 70,000 74,890
7.63%; 04/15/31 110,000 120,382
Gannett
4.95%; 04/01/05 75,000 76,966
News America
4.75%; 03/15/10 15,000 14,999
6.55%; 03/15/33 30,000 30,466
6.63%; 01/09/08 35,000 38,196
Viacom
6.63%; 05/15/11 15,000 16,619
Walt Disney
6.38%; 03/01/12 40,000 43,312
436,556
MUTUAL INSURANCE (0.06%)
Liberty Mutual Group /3/
5.75%; 03/15/14 35,000 34,240
7.00%; 03/15/34 25,000 24,519
58,759
NON-HAZARDOUS WASTE DISPOSAL (0.04%)
Allied Waste
5.75%; 02/15/11 /3/ 20,000 19,200
7.88%; 01/01/09 1,000 1,038
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
NON-HAZARDOUS WASTE DISPOSAL (CONTINUED)
Waste Management
$ $
5.00%; 03/15/14 20,000 19,230
39,468
NON-HOTEL GAMBLING (0.16%)
Horseshoe Gaming Holding
8.63%; 05/15/09 75,000 78,375
Mohegan Tribal Gaming Authority
6.38%; 07/15/09 40,000 40,800
Seneca Gaming /3/
7.25%; 05/01/12 40,000 40,550
159,725
OIL & GAS DRILLING (0.20%)
Consolidated Natural Gas
5.00%; 03/01/14 25,000 24,242
Nabors Holdings
4.88%; 08/15/09 45,000 45,957
Pride International
9.38%; 05/01/07 30,000 30,525
10.00%; 06/01/09 45,000 47,475
Transocean
7.38%; 04/15/18 50,000 57,466
205,665
OIL COMPANY-EXPLORATION & PRODUCTION (0.55%)
Anadarko Petroleum
5.38%; 03/01/07 120,000 126,740
Canadian Natural Resources
7.20%; 01/15/32 25,000 27,991
Chesapeake Energy
8.38%; 11/01/08 40,000 43,850
Devon Energy
7.95%; 04/15/32 40,000 46,503
EnCana
4.75%; 10/15/13 20,000 19,218
Nexen
5.05%; 11/20/13 15,000 14,557
7.88%; 03/15/32 25,000 29,279
Noble Energy /3/
5.25%; 04/15/14 40,000 39,542
Pemex Project Funding Master Trust
7.88%; 02/01/09 185,000 203,963
551,643
OIL COMPANY-INTEGRATED (0.19%)
El Paso CGP
6.20%; 05/15/04 20,000 20,000
Occidental Petroleum
4.00%; 11/30/07 25,000 25,199
PanCanadian Energy
7.20%; 11/01/31 35,000 39,031
Petro-Canada
5.35%; 07/15/33 20,000 17,281
Petrobras International Finance
8.38%; 12/10/18 40,000 37,600
9.13%; 07/02/13 30,000 30,075
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
OIL COMPANY-INTEGRATED (CONTINUED)
Petronas Capital /3/
$ $
7.88%; 05/22/22 20,000 22,675
191,861
OIL FIELD MACHINERY & EQUIPMENT (0.09%)
Cooper Cameron
2.65%; 04/15/07 50,000 48,846
Grant Prideco
9.00%; 12/15/09 40,000 44,500
93,346
OIL REFINING & MARKETING (0.12%)
Enterprise Products Partners
6.38%; 02/01/13 15,000 15,531
Tesoro Petroleum
8.00%; 04/15/08 40,000 43,100
Valero Energy
6.88%; 04/15/12 55,000 60,819
119,450
PAPER & RELATED PRODUCTS (0.40%)
Abitibi-Consolidated
6.95%; 12/15/06 50,000 51,855
Domtar
5.38%; 12/01/13 15,000 14,556
International Paper
3.80%; 04/01/08 80,000 79,164
6.75%; 09/01/11 25,000 27,468
Norske Skog /3/
7.63%; 10/15/11 50,000 56,414
Sappi Papier Holding /3/
6.75%; 06/15/12 20,000 21,615
Smurfit Capital Funding
6.75%; 11/20/05 40,000 41,200
Weyerhaeuser
6.13%; 03/15/07 60,000 64,222
6.75%; 03/15/12 40,000 43,850
400,344
PETROCHEMICALS (0.04%)
Braskem /3/
11.75%; 01/22/14 45,000 43,425
PHARMACY SERVICES (0.04%)
Omnicare
8.13%; 03/15/11 40,000 44,000
PHYSICAL THERAPY & REHABILITATION CENTERS (0.08%)
HealthSouth
6.88%; 06/15/05 80,000 80,000
PIPELINES (0.29%)
Buckeye Partners
4.63%; 07/15/13 35,000 33,222
CenterPoint Energy Resources
7.75%; 02/15/11 40,000 44,788
Duke Capital
4.37%; 03/01/09 25,000 24,509
Duke Energy Field Services
7.88%; 08/16/10 20,000 23,120
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
PIPELINES (CONTINUED)
Enbridge Energy Partners
$ $
4.00%; 01/15/09 15,000 14,879
Equitable Resources
5.15%; 11/15/12 25,000 25,464
National Fuel Gas
5.25%; 03/01/13 25,000 25,180
TEPPCO Partners
6.13%; 02/01/13 45,000 46,926
Texas Eastern Transmission
5.25%; 07/15/07 50,000 52,237
290,325
POULTRY (0.13%)
Tyson Foods
6.63%; 10/01/04 125,000 126,980
PRINTING-COMMERCIAL (0.03%)
R.R. Donnelley & Sons /3/
4.95%; 04/01/14 35,000 33,800
PROPERTY & CASUALTY INSURANCE (0.49%)
ACE
6.00%; 04/01/07 70,000 74,775
ACE INA Holdings
8.20%; 08/15/04 30,000 30,554
Arch Capital Group
7.35%; 05/01/34 60,000 60,950
Infinity Property & Casualty /3/
5.50%; 02/18/14 55,000 53,165
Markel
6.80%; 02/15/13 55,000 57,576
St. Paul
5.75%; 03/15/07 80,000 85,077
W.R. Berkley
5.13%; 09/30/10 55,000 55,432
XL Capital
6.50%; 01/15/12 70,000 76,655
494,184
PUBLISHING-BOOKS (0.06%)
Reed Elsevier Capital
6.13%; 08/01/06 55,000 59,233
PUBLISHING-PERIODICALS (0.02%)
Reader's Digest Association /3/
6.50%; 03/01/11 25,000 25,250
RECREATIONAL CENTERS (0.05%)
AMF Bowling Worldwide /3/
10.00%; 03/01/10 45,000 46,688
REGIONAL BANKS (0.60%)
Bank One
7.63%; 08/01/05 80,000 85,357
KeyCorp
4.63%; 05/16/05 100,000 102,497
8.00%; 07/01/04 30,000 30,304
PNC Funding
5.75%; 08/01/06 100,000 106,136
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
REGIONAL BANKS (CONTINUED)
SunTrust Banks
$ $
5.05%; 07/01/07 35,000 36,680
Wachovia
5.63%; 12/15/08 100,000 105,906
Wells Fargo
3.12%; 08/15/08 30,000 29,099
5.13%; 02/15/07 100,000 105,264
601,243
REINSURANCE (0.05%)
Berkshire Hathaway /3/
4.63%; 10/15/13 55,000 53,266
RENTAL-AUTO & EQUIPMENT (0.08%)
NationsRent /3/
9.50%; 10/15/10 60,000 64,350
United Rentals /3/
6.50%; 02/15/12 20,000 19,300
83,650
RESEARCH & DEVELOPMENT (0.03%)
Science Applications International
5.50%; 07/01/33 5,000 4,463
7.13%; 07/01/32 25,000 27,652
32,115
RESORTS & THEME PARKS (0.07%)
Intrawest
10.50%; 02/01/10 65,000 71,012
RETAIL-PROPANE DISTRIBUTION (0.03%)
Ferrellgas Partners /3/
6.75%; 05/01/14 35,000 35,000
RETAIL-RESTAURANTS (0.09%)
Yum! Brands
7.70%; 07/01/12 80,000 92,515
RETAIL-VISION SERVICE CENTER (0.02%)
Cole National Group
8.63%; 08/15/07 15,000 15,263
RETAIL-VITAMINS & NUTRITIONAL SUPPLIES (0.06%)
General Nutrition Centers /3/
8.50%; 12/01/10 60,000 62,700
SAVINGS & LOANS-THRIFTS (0.09%)
Washington Mutual
3.97%; 03/25/33 72,000 70,877
5.50%; 01/15/13 15,000 15,247
86,124
SOVEREIGN (0.30%)
Mexico Government
8.00%; 09/24/22 40,000 42,200
8.30%; 08/15/31 35,000 37,555
8.38%; 01/14/11 190,000 218,500
298,255
SPECIAL PURPOSE ENTITY (0.04%)
Fondo Latinoamericano de Reservas /3/
3.00%; 08/01/06 45,000 45,040
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
STEEL PIPE & TUBE (0.04%)
Valmont Industries /3/
$ $
6.88%; 05/01/14 40,000 40,100
STEEL PRODUCERS (0.07%)
International Steel Group /3/
6.50%; 04/15/14 75,000 72,000
STEEL-SPECIALTY (0.05%)
CSN Islands VIII /3/
9.75%; 12/16/13 60,000 54,000
SUPRANATIONAL BANK (0.12%)
Corp Andina de Fomento
6.75%; 03/15/05 65,000 67,451
6.88%; 03/15/12 45,000 49,444
116,895
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.05%)
Corning
5.90%; 03/15/14 55,000 53,487
TELECOMMUNICATION SERVICES (0.04%)
MasTec
7.75%; 02/01/08 45,000 43,650
TELEPHONE-INTEGRATED (1.16%)
AT&T
6.00%; 03/15/09 20,000 20,028
British Telecommunications
7.88%; 12/15/05 230,000 248,936
Citizens Communications
7.63%; 08/15/08 30,000 31,223
Deutsche Telekom International Finance
5.25%; 07/22/13 130,000 129,044
8.50%; 06/15/10 /4/ 30,000 35,447
France Telecom /4/
8.75%; 03/01/11 70,000 82,754
Qwest
7.20%; 11/01/04 45,000 45,562
Sprint Capital
6.00%; 01/15/07 40,000 42,519
6.13%; 11/15/08 35,000 37,477
6.88%; 11/15/28 110,000 107,991
6.90%; 05/01/19 30,000 31,045
Telecom Italia Capital /3/
4.00%; 11/15/08 35,000 34,694
5.25%; 11/15/13 100,000 98,593
6.38%; 11/15/33 20,000 19,616
Telefonica Europe
7.75%; 09/15/10 75,000 86,990
Telefonos de Mexico
4.50%; 11/19/08 /3/ 10,000 9,883
8.25%; 01/26/06 100,000 108,226
1,170,028
TEXTILE-HOME FURNISHINGS (0.03%)
Mohawk Industries
6.50%; 04/15/07 30,000 32,400
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
THEATERS (0.12%)
Cinemark /1/ /3/ /4 /
$ $
0.00%; 03/15/14 50,000 31,313
Cinemark USA
8.50%; 08/01/08 85,000 88,187
119,500
TRANSPORT-RAIL (0.09%)
Union Pacific
4.70%; 01/02/24 15,000 14,488
5.75%; 10/15/07 70,000 74,722
89,210
TRANSPORT-SERVICES (0.05%)
FedEx
1.39%; 04/01/05 /3/ /4/ 30,000 29,995
3.50%; 04/01/09 /3/ 20,000 19,341
49,336
VENTURE CAPITAL (0.04%)
Arch Western Finance /3/
6.75%; 07/01/13 35,000 36,050
VITAMINS & NUTRITION PRODUCTS (0.03%)
WH Holdings/WH Capital /3/
9.50%; 04/01/11 25,000 26,563
WIRE & CABLE PRODUCTS (0.15%)
Superior Essex Communications /3/
9.00%; 04/15/12 160,000 153,600
TOTAL BONDS 23,000,266
Principal
Type Rate Maturity Amount Value
- ------------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) CERTIFICATES (5.23%)
$ $
FHLMC /6/ 5.00% 12/01/17 - 06/01/34 1,692,735 1,690,350
FHLMC /6/ 5.50% 03/01/33 - 05/01/34 2,298,149 2,295,557
FHLMC /6/ 6.00% 01/01/29 - 05/01/34 466,070 477,044
FHLMC 6.50% 12/01/20 - 06/01/31 296,867 309,510
FHLMC 7.00% 12/01/27 - 09/01/31 189,838 200,724
FHLMC 7.50% 11/01/30 - 01/01/31 101,805 109,358
FHLMC 8.00% 12/01/30 163,363 176,508
TOTAL FHLMC CERTIFICATES 5,259,051
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) CERTIFICATES (5.65%)
FNMA 4.50% 05/01/10 - 07/01/33 530,242 518,582
FNMA /6/ 5.00% 03/01/18 - 06/01/19 1,007,623 1,010,631
FNMA /6/ 5.50% 01/01/33 - 05/01/34 3,510,560 3,503,107
FNMA 6.00% 06/01/06 - 05/01/10 372,344 390,782
FNMA 6.50% 05/01/06 - 03/01/08 243,280 255,228
TOTAL FNMA CERTIFICATES 5,678,330
Principal
Type Rate Maturity Amount Value
- ------------------------------------------------------------------------------------------------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) CERTIFICATES (1.59%)
$ $
GNMA I 6.00% 06/15/32 - 12/15/33 267,797 274,727
GNMA I 6.50% 05/15/32 402,783 420,867
GNMA I 7.00% 05/15/31 - 02/15/32 210,662 224,023
GNMA II 6.00% 06/20/26 - 06/20/27 353,705 363,191
GNMA II /6/ 6.50% 05/01/34 300,000 312,691
TOTAL GNMA CERTIFICATES 1,595,499
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
TREASURY BONDS (3.99%)
U.S. Treasury
$ $
4.00%; 02/15/14 175,000 168,109
5.38%; 02/15/31 275,000 278,609
6.25%; 05/15/30 225,000 252,852
7.13%; 02/15/23 240,000 292,031
7.25%; 05/15/16 50,000 60,914
7.50%; 11/15/16 135,000 167,838
8.00%; 11/15/21 285,000 375,443
U.S. Treasury Inflation-Indexed Obligations
2.00%; 01/15/14 352,702 350,195
3.38%; 01/15/07 176,286 190,086
3.50%; 01/15/11 401,190 446,904
3.63%; 01/15/08 432,206 475,545
3.88%; 01/15/09 425,764 477,471
U.S. Treasury Strip /1/
0.00%; 02/15/15 800,000 472,168
TOTAL TREASURY BONDS 4,008,165
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (2.27%)
DIVERSIFIED FINANCIAL SERVICES (2.27%)
Investment in Joint Trading Account; Citigroup
1.02%; 05/03/04 2,281,796 2,281,796
TOTAL COMMERCIAL PAPER 2,281,796
SCHEDULE OF INVESTMENTS
PRINCIPAL BALANCED FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Maturity
Amount Value
- ----------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (0.55%)
Bear Stearns 1.03%; dated 04/30/04
maturing 05/03/04 (collateralized by
FHLMC; $36,720; 12/30/11) /7/ $ 36,009 $ 36,000
Deutsche Bank 1.02%; dated 04/30/04
maturing 05/03/04 (collateralized by
FHLMC; $522,891; 02/15/07) /7/ 512,682 512,638
TOTAL REPURCHASE AGREEMENTS 548,638
--------
TOTAL PORTFOLIO INVESTMENTS (105.98%) 106,483,772
LIABILITIES, NET OF CASH, RECEIVABLES, AND
OTHER ASSETS (-5.98%) (6,011,620)
TOTAL NET ASSETS (100.00%) $100,472,152
--------------
/1 /Non-income producing security.
/2 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/3 /Restricted Security - The fund held securities which may require
registration under the Securities Act of 1933, or an exemption therefrom, in
order to effect their sale in the ordinary course of business. At the end of
the period, restricted securities totaled $3,215,309 or 3.20% of net assets.
/4 /Variable rate.
/5 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors.
/6 /Security or a portion of the security was purchased in a "to-be-announced"
("TBA") transaction. See Notes to Financial Statements.
/7 /Security was purchased with the cash proceeds from securities loans.
SCHEDULE OF INVESTMENTS
PRINCIPAL BOND FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (58.79%)
ADVANCED MATERIALS & PRODUCTS (0.12%)
Hexcel
$ $
9.75%; 01/15/09 250,000 262,500
AEROSPACE & DEFENSE (0.42%)
Raytheon
1.58%; 06/10/05 /1/ 550,000 550,155
4.85%; 01/15/11 350,000 348,463
898,618
AEROSPACE & DEFENSE EQUIPMENT (0.11%)
K&F Industries
9.25%; 10/15/07 225,000 232,875
AGRICULTURAL OPERATIONS (0.40%)
Bunge Limited Finance
4.38%; 12/15/08 /2/ 430,000 428,511
5.35%; 04/15/14 /2/ 270,000 262,923
5.88%; 05/15/13 160,000 162,836
854,270
AIRLINES (0.25%)
Northwest Airlines
7.58%; 09/01/20 303,099 306,700
Southwest Airlines
5.10%; 05/01/06 220,348 227,804
534,504
ASSET BACKED SECURITIES (1.18%)
Bear Stearns Asset Backed Securities /1/
1.70%; 03/25/34 515,000 514,999
Chase Funding Mortgage Loan
3.07%; 08/25/17 128,258 128,153
Chase Funding Mortgage Loan Asset Backed Certificates
/1/
1.39%; 09/25/33 400,000 400,000
1.60%; 09/25/33 420,000 420,000
Countrywide Asset-Backed Certificates
3.61%; 04/25/30 490,000 492,382
Master Adjustable Rate Mortgages Trust /1/
2.20%; 03/25/34 545,000 549,069
2,504,603
AUTO-CARS & LIGHT TRUCKS (0.90%)
DaimlerChrysler Holding
2.13%; 08/08/06 /1/ 650,000 657,185
4.05%; 06/04/08 400,000 392,907
4.75%; 01/15/08 75,000 76,086
7.25%; 01/18/06 225,000 241,080
Ford Motor
7.45%; 07/16/31 125,000 121,857
General Motors
8.25%; 07/15/23 275,000 294,299
Hyundai Motor Manufacturing /2/
5.30%; 12/19/08 130,000 129,560
1,912,974
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.16%)
Navistar International
8.00%; 02/01/08 335,000 344,212
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.43%)
Delco Remy International
$ $
8.63%; 12/15/07 250,000 257,500
Delphi /1/
1.69%; 12/01/04 325,000 325,000
Lear
7.96%; 05/15/05 320,000 336,800
919,300
AUTOMOBILE SEQUENTIAL (0.92%)
Capital Auto Receivables Asset Trust
4.50%; 10/15/07 950,000 974,355
Toyota Auto Receivables Owner Trust
2.65%; 11/15/06 978,309 983,946
1,958,301
BREWERY (0.36%)
Cia Brasileira de Bebidas
10.50%; 12/15/11 300,000 343,500
Coors Brewing
6.38%; 05/15/12 245,000 264,526
SABMiller /2/
6.63%; 08/15/33 150,000 156,255
764,281
BROADCASTING SERVICES & PROGRAMMING (0.52%)
Clear Channel Communications
5.75%; 01/15/13 415,000 424,329
Grupo Televisa
8.50%; 03/11/32 100,000 105,500
Liberty Media
3.50%; 09/25/06 385,000 385,743
5.70%; 05/15/13 200,000 199,982
1,115,554
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.74%)
CRH America
6.40%; 10/15/33 155,000 154,788
6.95%; 03/15/12 229,000 254,948
Masco
1.37%; 03/09/07 /1/ /2/ 675,000 674,724
6.00%; 05/03/04 500,000 500,000
1,584,460
BUILDING PRODUCTS-AIR & HEATING (0.10%)
York International
6.63%; 08/15/06 200,000 212,356
BUILDING PRODUCTS-WOOD (0.04%)
Celulosa Arauco y Constitucion
5.13%; 07/09/13 90,000 85,409
BUILDING-RESIDENTIAL & COMMERCIAL (0.18%)
DR Horton
8.50%; 04/15/12 335,000 376,037
CABLE TV (1.15%)
Comcast
5.30%; 01/15/14 50,000 48,809
5.50%; 03/15/11 740,000 758,153
5.85%; 01/15/10 30,000 31,502
7.05%; 03/15/33 230,000 241,958
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
CABLE TV (CONTINUED)
Comcast Cable Communications
$ $
6.75%; 01/30/11 220,000 241,096
Cox Communications
5.50%; 10/01/15 155,000 150,898
6.75%; 03/15/11 630,000 688,330
EchoStar DBS
10.38%; 10/01/07 275,000 297,344
2,458,090
CASINO HOTELS (0.29%)
Aztar
8.88%; 05/15/07 605,000 624,662
CASINO SERVICES (0.16%)
International Game Technology
8.38%; 05/15/09 290,000 339,573
CELLULAR TELECOMMUNICATIONS (1.52%)
America Movil /2/
5.50%; 03/01/14 435,000 407,028
AT&T Wireless Services
7.88%; 03/01/11 295,000 339,786
8.13%; 05/01/12 480,000 559,864
Nextel Communications
9.38%; 11/15/09 240,000 259,500
Rogers Wireless Communications /2/
6.38%; 03/01/14 445,000 418,300
Rural Cellular /2/
8.25%; 03/15/12 120,000 123,900
Telus
7.50%; 06/01/07 445,000 491,744
8.00%; 06/01/11 40,000 46,398
U.S. Cellular
6.70%; 12/15/33 75,000 73,277
Verizon Wireless Capital
5.38%; 12/15/06 480,000 506,504
3,226,301
CHEMICALS-DIVERSIFIED (0.51%)
Chevron Phillips Chemical
5.38%; 06/15/07 240,000 252,571
7.00%; 03/15/11 265,000 292,360
ICI Wilmington I
5.63%; 12/01/13 220,000 219,586
Lyondell Chemical
9.88%; 05/01/07 200,000 210,000
Phibro Animal Health
9.88%; 06/01/08 125,000 113,750
1,088,267
CHEMICALS-SPECIALTY (0.17%)
Hercules /2/
6.75%; 10/15/29 200,000 198,000
Westlake Chemical
8.75%; 07/15/11 140,000 153,650
351,650
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
CIRCUIT BOARDS (0.13%)
Jabil Circuit
$ $
5.88%; 07/15/10 275,000 285,620
COAL (0.20%)
Massey Energy
6.63%; 11/15/10 120,000 120,600
Peabody Energy
6.88%; 03/15/13 290,000 301,600
422,200
COATINGS & PAINT (0.08%)
Valspar
6.00%; 05/01/07 160,000 170,975
COMMERCIAL BANKS (0.22%)
AmSouth Bank
4.85%; 04/01/13 225,000 219,301
Union Planters Bank
5.13%; 06/15/07 240,000 255,524
474,825
COMMERCIAL SERVICE-FINANCE (0.05%)
Dollar Financial Group
9.75%; 11/15/11 100,000 107,500
COMMERCIAL SERVICES (0.07%)
Iron Mountain
6.63%; 01/01/16 150,000 139,500
COMPUTER SERVICES (0.18%)
Sungard Data Systems /2/
4.88%; 01/15/14 155,000 148,908
Unisys
7.88%; 04/01/08 220,000 225,500
374,408
COMPUTERS-INTEGRATED SYSTEMS (0.04%)
NCR
7.13%; 06/15/09 75,000 82,855
CONTAINERS-PAPER & PLASTIC (0.13%)
Norampac
6.75%; 06/01/13 275,000 286,000
CREDIT CARD ASSET BACKED SECURITIES (1.74%)
American Express Credit Account Master
Trust /1/
1.35%; 09/15/11 200,000 200,463
American Express Master Trust
7.85%; 08/15/05 600,000 614,675
Capital One Multi-Asset Execution Trust /1/
1.32%; 12/15/09 550,000 550,459
Chase Credit Card Master Trust /1/
1.30%; 05/15/09 750,000 750,000
MBNA Master Credit Card Trust
6.90%; 01/15/08 1,500,000 1,592,090
3,707,687
DATA PROCESSING & MANAGEMENT (0.06%)
Certegy
4.75%; 09/15/08 135,000 137,390
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
DIVERSIFIED FINANCIAL SERVICES (1.37%)
Citigroup
$ $
5.13%; 05/05/14 160,000 158,565
5.75%; 05/10/06 750,000 795,081
6.63%; 06/15/32 215,000 225,594
General Electric Capital
0.70%; 03/10/40 /1/ 5,145,572 173,205
1.28%; 02/02/09 /1/ 775,000 776,323
6.75%; 03/15/32 475,000 511,389
John Deere Capital
3.13%; 12/15/05 160,000 162,166
NiSource Finance
3.20%; 11/01/06 120,000 120,019
2,922,342
DIVERSIFIED MANUFACTURING OPERATIONS (0.30%)
General Electric
5.00%; 02/01/13 125,000 124,283
Tyco International Group
6.00%; 11/15/13 /2/ 200,000 202,746
6.38%; 02/15/06 300,000 316,063
643,092
DIVERSIFIED MINERALS (0.15%)
Corp. Nacional del Cobre de Chile /2/
5.50%; 10/15/13 125,000 124,359
Vale Overseas
9.00%; 08/15/13 185,000 193,094
317,453
DIVERSIFIED OPERATIONS (0.15%)
Hutchison Whampoa International /2/
6.50%; 02/13/13 325,000 327,375
E-COMMERCE-PRODUCTS (0.06%)
FTD /2/
7.75%; 02/15/14 130,000 128,700
ELECTRIC-GENERATION (0.19%)
CE Casecnan Water & Energy
11.45%; 11/15/05 160,600 161,403
Korea East-West Power /2/
4.88%; 04/21/11 85,000 83,227
Tenaska Virginia Partners /2/
6.12%; 03/30/24 160,000 160,000
404,630
ELECTRIC-INTEGRATED (4.89%)
Appalachian Power
5.95%; 05/15/33 90,000 84,327
Arizona Public Service
6.50%; 03/01/12 205,000 220,553
Centerpoint Energy
5.88%; 06/01/08 180,000 183,316
7.25%; 09/01/10 165,000 175,950
Consolidated Edison
3.63%; 08/01/08 185,000 182,922
Consumers Energy
4.25%; 04/15/08 70,000 69,963
6.00%; 03/15/05 160,000 164,458
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
ELECTRIC-INTEGRATED (CONTINUED)
Dayton Power & Light /2/
$ $
5.13%; 10/01/13 200,000 192,960
Dominion Resources
1.39%; 05/15/06 /1/ 550,000 550,817
7.82%; 09/15/04 1,000,000 1,022,426
DPL
6.88%; 09/01/11 250,000 246,250
DTE Energy
6.00%; 06/01/04 525,000 526,660
Entergy Gulf States
3.60%; 06/01/08 180,000 174,268
Exelon
6.75%; 05/01/11 200,000 220,790
FirstEnergy
6.45%; 11/15/11 325,000 342,160
FPL Energy Wind Funding /2/
6.88%; 06/27/17 260,000 261,300
FPL Group Capital
3.25%; 04/11/06 170,000 171,844
Georgia Power /1/
1.30%; 02/17/09 900,000 899,064
Indianapolis Power & Light
7.38%; 08/01/07 230,000 253,262
Jersey Central Power & Light /2/
5.63%; 05/01/16 80,000 79,203
MidAmerican Energy Holdings
4.63%; 10/01/07 200,000 204,422
6.75%; 12/30/31 235,000 252,556
MSW Energy /2/
7.38%; 09/01/10 225,000 232,875
Northeast Utilities
3.30%; 06/01/08 145,000 139,297
Ohio Power
4.85%; 01/15/14 185,000 178,317
Oncor Electric Delivery
6.38%; 05/01/12 275,000 297,939
Pacific Gas & Electric
3.60%; 03/01/09 150,000 145,502
6.05%; 03/01/34 515,000 487,036
Pepco Holdings
3.75%; 02/15/06 565,000 573,245
4.00%; 05/15/10 70,000 66,668
Power Contract Financing /2/
5.20%; 02/01/06 152,785 155,082
PSI Energy
5.00%; 09/15/13 220,000 214,673
Puget Energy
3.36%; 06/01/08 175,000 167,571
Southern California Edison
5.00%; 01/15/14 85,000 83,389
8.00%; 02/15/07 290,000 325,158
Southwestern Electric Power
4.50%; 07/01/05 240,000 245,911
TXU Energy
6.13%; 03/15/08 140,000 149,330
Virginia Electric & Power
4.50%; 12/15/10 320,000 315,456
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
ELECTRIC-INTEGRATED (CONTINUED)
Westar Energy
$ $
8.50%; 07/01/22 150,000 154,500
10,411,420
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.07%)
Flextronics International
6.50%; 05/15/13 150,000 151,875
ELECTRONICS-MILITARY (0.24%)
L-3 Communications
8.00%; 08/01/08 480,000 502,200
FEDERAL & FEDERALLY SPONSORED CREDIT (0.16%)
Housing Urban Development
2.99%; 08/01/05 325,000 329,479
FIDUCIARY BANKS (0.34%)
State Street Capital Trust II /1/
1.62%; 02/15/08 725,000 730,011
FINANCE-AUTO LOANS (1.86%)
American Honda Finance /1/ /2/
1.25%; 02/20/07 900,000 899,615
Ford Motor Credit
5.80%; 01/12/09 225,000 229,166
6.13%; 01/09/06 225,000 234,527
6.88%; 02/01/06 160,000 169,356
7.25%; 10/25/11 450,000 477,500
7.38%; 02/01/11 400,000 427,730
7.88%; 06/15/10 160,000 175,779
General Motors Acceptance
2.40%; 10/20/05 /1/ 550,000 553,745
6.88%; 09/15/11 110,000 115,457
6.88%; 08/28/12 250,000 260,665
8.00%; 11/01/31 180,000 189,976
Toyota Motor Credit
2.80%; 01/18/06 220,000 223,037
3,956,553
FINANCE-COMMERCIAL (0.21%)
CIT Group /1/
1.32%; 02/15/07 450,000 450,366
FINANCE-CONSUMER LOANS (1.16%)
Household Finance
1.28%; 02/09/07 /1/ 775,000 776,417
3.38%; 02/21/06 95,000 96,328
4.13%; 12/15/08 200,000 199,914
4.75%; 07/15/13 155,000 148,105
5.75%; 01/30/07 700,000 745,488
7.00%; 05/15/12 125,000 140,048
SLM
5.38%; 05/15/14 375,000 374,228
2,480,528
FINANCE-CREDIT CARD (0.22%)
Capital One Bank
6.88%; 02/01/06 435,000 463,767
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-INVESTMENT BANKER & BROKER (2.60%)
Bear Stearns
$ $
1.47%; 01/30/09 /1/ 575,000 576,048
1.67%; 06/25/34 /1/ /4/ 425,000 425,000
3.00%; 03/30/06 165,000 165,995
4.00%; 01/31/08 210,000 211,754
Credit Suisse First Boston
3.88%; 01/15/09 150,000 148,039
Goldman Sachs Group
3.88%; 01/15/09 100,000 98,454
5.15%; 01/15/14 130,000 126,514
6.60%; 01/15/12 480,000 525,603
6.88%; 01/15/11 475,000 528,529
Lehman Brothers Holdings
4.80%; 03/13/14 315,000 300,759
Merrill Lynch
1.38%; 02/06/09 /1/ 775,000 775,242
4.50%; 11/04/10 225,000 223,308
Morgan Stanley
1.07%; 04/15/34 /1/ 4,670,060 130,309
1.25%; 02/15/07 /1/ 500,000 500,118
4.25%; 05/15/10 135,000 132,960
4.75%; 04/01/14 270,000 252,258
5.30%; 03/01/13 165,000 164,908
6.75%; 04/15/11 225,000 248,558
5,534,356
FINANCE-LEASING COMPANY (0.25%)
Boeing Capital
7.10%; 09/27/05 500,000 532,431
FINANCE-MORTGAGE LOAN/BANKER (5.83%)
Countrywide Home Loan
1.27%; 02/17/06 /1/ 125,000 124,988
1.60%; 06/02/06 /1/ 775,000 780,354
4.25%; 12/19/07 120,000 121,971
4.64%; 12/19/33 /1/ 1,000,000 971,938
5.25%; 06/15/04 1,000,000 1,004,387
Federal Home Loan Mortgage
2.65%; 05/30/08 275,000 264,853
3.25%; 02/25/08 1,675,000 1,647,434
4.75%; 10/11/12 550,000 536,780
4.75%; 05/06/13 575,000 557,487
6.25%; 07/15/32 125,000 132,751
6.75%; 03/15/31 541,000 610,388
Federal National Mortgage Association
2.88%; 05/19/08 275,000 265,494
3.32%; 11/25/32 405,310 405,947
3.70%; 11/01/07 1,430,000 1,436,246
3.75%; 07/29/05 1,075,000 1,080,441
4.32%; 07/26/07 530,000 544,053
4.75%; 02/21/13 550,000 534,322
6.25%; 05/15/29 1,000,000 1,061,758
7.25%; 05/15/30 280,000 334,618
12,416,210
FINANCE-OTHER SERVICES (0.50%)
Verizon Global Funding
6.75%; 12/01/05 1,000,000 1,067,021
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FOOD-MISCELLANEOUS/DIVERSIFIED (0.51%)
Corn Products International
$ $
8.45%; 08/15/09 265,000 304,750
General Mills
6.00%; 02/15/12 240,000 254,467
Kraft Foods
4.63%; 11/01/06 325,000 336,133
5.63%; 11/01/11 65,000 67,155
6.50%; 11/01/31 125,000 128,080
1,090,585
FOOD-RETAIL (0.36%)
Delhaize America
7.38%; 04/15/06 360,000 384,800
Kroger
6.20%; 06/15/12 200,000 212,406
Safeway
5.80%; 08/15/12 35,000 35,955
6.50%; 03/01/11 125,000 134,555
767,716
GOLD MINING (0.04%)
Placer Dome
6.38%; 03/01/33 30,000 29,969
6.45%; 10/15/35 50,000 49,984
79,953
HOME DECORATION PRODUCTS (0.09%)
Newell Rubbermaid
4.00%; 05/01/10 100,000 95,375
4.63%; 12/15/09 85,000 84,834
180,209
HOME EQUITY-OTHER (1.20%)
Argent Securities /1/
1.32%; 02/25/34 400,000 399,901
Long Beach Mortgage Loan Trust /1/ /4/
1.63%; 06/25/34 140,000 140,000
2.18%; 06/25/34 165,000 165,000
Option One Mortgage Loan Trust /1/ /4/
1.63%; 05/25/34 400,000 400,000
2.15%; 05/25/34 400,000 400,000
Saxon Asset Securities Trust /1/
2.23%; 03/25/35 675,000 673,698
Specialty Underwriting & Residential Finance /1/
1.61%; 02/25/35 385,000 385,000
2,563,599
HOME EQUITY-SEQUENTIAL (0.63%)
Ameriquest Mortgage Securities /1/
1.29%; 04/25/34 460,000 460,000
Residential Asset Securities
3.28%; 08/25/29 550,000 548,488
4.59%; 10/25/26 322,433 326,563
1,335,051
HOTELS & MOTELS (0.20%)
Extended Stay America
9.15%; 03/15/08 420,000 434,700
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.09%)
AMVESCAP
$ $
5.38%; 02/27/13 75,000 72,003
5.90%; 01/15/07 110,000 117,359
189,362
LIFE & HEALTH INSURANCE (0.49%)
John Hancock Global Funding II /1/ /2/
1.28%; 04/03/09 800,000 798,858
Lincoln National
5.25%; 06/15/07 180,000 191,755
Nationwide Financial Services
5.63%; 02/13/15 60,000 61,197
1,051,810
MACHINERY-CONSTRUCTION & MINING (0.11%)
Terex
9.25%; 07/15/11 200,000 223,000
MEDICAL PRODUCTS (0.18%)
Hanger Orthopedic Group
10.38%; 02/15/09 350,000 390,250
MEDICAL-DRUGS (0.19%)
Schering-Plough
5.30%; 12/01/13 185,000 184,704
Wyeth
6.45%; 02/01/24 210,000 209,715
394,419
MEDICAL-HMO (0.24%)
Anthem
4.88%; 08/01/05 500,000 515,714
MEDICAL-HOSPITALS (0.33%)
HCA
5.25%; 11/06/08 210,000 210,083
7.13%; 06/01/06 225,000 239,241
Triad Hospitals
8.75%; 05/01/09 220,000 243,925
693,249
METAL PROCESSORS & FABRICATION (0.11%)
Mueller Group /2/
10.00%; 05/01/12 225,000 235,688
METAL-DIVERSIFIED (0.40%)
Falconbridge
5.38%; 06/01/15 115,000 111,489
7.35%; 06/05/12 65,000 73,115
Noranda
7.25%; 07/15/12 240,000 267,532
Rio Tinto Finance
5.75%; 07/03/06 380,000 402,782
854,918
MISCELLANEOUS INVESTING (0.36%)
CenterPoint Properties Trust
4.75%; 08/01/10 225,000 223,291
iStar Financial /2/
4.88%; 01/15/09 280,000 272,650
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MISCELLANEOUS INVESTING (CONTINUED)
United Dominion Realty Trust
$ $
6.50%; 06/15/09 240,000 260,572
756,513
MONEY CENTER BANKS (0.64%)
Bank of America
4.88%; 09/15/12 685,000 677,599
7.40%; 01/15/11 280,000 321,971
JP Morgan Chase
4.50%; 11/15/10 230,000 226,879
United Overseas Bank /2/
4.50%; 07/02/13 150,000 139,617
1,366,066
MORTGAGE BACKED SECURITIES (0.74%)
Banc of America Commercial Mortgage /1/
0.05%; 11/10/38 3,128,093 53,037
1.16%; 11/10/38 2,031,463 106,969
Bear Stearns Commercial Mortgage Securities /1/ /2/
0.72%; 05/11/39 2,700,000 80,187
GMAC Commercial Mortgage Securities /1/
0.97%; 03/10/38 3,769,474 173,102
Greenwich Capital Commercial Funding /1/
0.55%; 05/10/11 8,700,000 175,305
JP Morgan Chase Commercial Mortgage Securities /1/ /2/
1.22%; 01/12/39 3,700,000 211,492
LB-UBS Commercial Mortgage Trust /1/ /2/
0.15%; 03/01/36 2,330,768 62,189
0.87%; 03/15/34 3,257,726 81,616
1.41%; 03/15/36 2,283,684 129,407
Merrill Lynch Mortgage Trust /1/
0.76%; 02/12/42 9,193,847 249,236
Morgan Stanley Capital I
1.12%; 01/13/41/1/ /2/ 2,500,000 141,640
7.11%; 04/15/33 100,000 112,207
1,576,387
MULTI-LINE INSURANCE (0.09%)
Safeco
4.88%; 02/01/10 190,000 194,512
MULTIMEDIA (0.77%)
AOL Time Warner
7.63%; 04/15/31 785,000 859,093
News America
4.75%; 03/15/10 90,000 89,992
6.55%; 03/15/33 225,000 228,499
6.63%; 01/09/08 /5/ 250,000 272,829
Walt Disney
5.38%; 06/01/07 175,000 183,627
1,634,040
MUTUAL INSURANCE (0.15%)
Liberty Mutual Group /2/
5.75%; 03/15/14 195,000 190,766
7.00%; 03/15/34 130,000 127,499
318,265
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
NON-HAZARDOUS WASTE DISPOSAL (0.22%)
Allied Waste
$ $
5.75%; 02/15/11 /2/ 130,000 124,800
6.38%; 04/15/11 /2/ 200,000 198,000
7.88%; 01/01/09 23,000 23,862
Waste Management
5.00%; 03/15/14 125,000 120,188
466,850
NON-HOTEL GAMBLING (0.12%)
Horseshoe Gaming Holding
8.63%; 05/15/09 250,000 261,250
OIL & GAS DRILLING (0.51%)
Nabors Holdings
4.88%; 08/15/09 270,000 275,745
Pride International
9.38%; 05/01/07 /5/ 225,000 228,937
10.00%; 06/01/09 225,000 237,375
Transocean
7.38%; 04/15/18 300,000 344,798
1,086,855
OIL COMPANY-EXPLORATION & PRODUCTION (1.43%)
Anadarko Finance
6.75%; 05/01/11 275,000 305,138
Canadian Natural Resources
7.20%; 01/15/32 145,000 162,349
Chesapeake Energy
8.38%; 11/01/08 135,000 147,994
Devon Energy
7.95%; 04/15/32 165,000 191,826
Nexen
5.05%; 11/20/13 105,000 101,897
7.88%; 03/15/32 125,000 146,397
Noble Energy /2/
5.25%; 04/15/14 235,000 232,310
Pemex Project Funding Master Trust
6.13%; 08/15/08 315,000 327,600
7.88%; 02/01/09 700,000 771,750
Petroleos Mexicanos
6.50%; 02/01/05 600,000 615,000
XTO Energy
6.25%; 04/15/13 50,000 53,274
3,055,535
OIL COMPANY-INTEGRATED (0.48%)
El Paso CGP
6.20%; 05/15/04 130,000 130,000
Occidental Petroleum
4.00%; 11/30/07 175,000 176,393
Petro-Canada
5.35%; 07/15/33 135,000 116,644
Petrobras International Finance
8.38%; 12/10/18 225,000 211,500
9.13%; 02/01/07 225,000 245,813
Petronas Capital /2/
7.88%; 05/22/22 125,000 141,719
1,022,069
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
OIL FIELD MACHINERY & EQUIPMENT (0.31%)
Cooper Cameron
$ $
2.65%; 04/15/07 290,000 283,305
Grant Prideco
9.00%; 12/15/09 345,000 383,813
667,118
OIL REFINING & MARKETING (0.17%)
Enterprise Products Partners
6.38%; 02/01/13 110,000 113,895
Valero Energy
6.88%; 04/15/12 225,000 248,803
362,698
OIL-FIELD SERVICES (0.37%)
Halliburton /1/
2.65%; 10/17/05 775,000 783,978
PAPER & RELATED PRODUCTS (1.02%)
Domtar
5.38%; 12/01/13 95,000 92,190
International Paper
3.80%; 04/01/08 550,000 544,250
5.85%; 10/30/12 55,000 56,780
6.75%; 09/01/11 50,000 54,936
Norske Skog /2/
7.63%; 10/15/11 500,000 564,136
Sappi Papier Holding /2/
6.75%; 06/15/12 140,000 151,307
Smurfit Capital Funding
6.75%; 11/20/05 330,000 339,900
Weyerhaeuser
6.75%; 03/15/12 265,000 290,508
7.38%; 03/15/32 75,000 82,164
2,176,171
PETROCHEMICALS (0.12%)
Braskem /2/
11.75%; 01/22/14 265,000 255,725
PHARMACY SERVICES (0.15%)
Omnicare
8.13%; 03/15/11 295,000 324,500
PHYSICAL THERAPY & REHABILITATION CENTERS (0.16%)
HealthSouth
6.88%; 06/15/05 350,000 350,000
PIPELINES (0.88%)
Buckeye Partners
4.63%; 07/15/13 275,000 261,032
CenterPoint Energy Resources
7.75%; 02/15/11 270,000 302,317
Duke Capital
4.37%; 03/01/09 140,000 137,248
Duke Energy Field Services
7.88%; 08/16/10 260,000 300,564
Enbridge Energy Partners
4.00%; 01/15/09 90,000 89,274
Equitable Resources
5.15%; 11/15/12 130,000 132,414
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
PIPELINES (CONTINUED)
Kinder Morgan Energy Partners
$ $
5.35%; 08/15/07 170,000 179,167
National Fuel Gas
5.25%; 03/01/13 175,000 176,256
TEPPCO Partners
6.13%; 02/01/13 45,000 46,926
Texas Eastern Transmission
5.25%; 07/15/07 245,000 255,961
1,881,159
POULTRY (0.37%)
Tyson Foods
6.63%; 10/01/04 785,000 797,434
PRINTING-COMMERCIAL (0.09%)
R.R. Donnelley & Sons /2/
4.95%; 04/01/14 200,000 193,143
PROPERTY & CASUALTY INSURANCE (1.30%)
ACE
6.00%; 04/01/07 150,000 160,232
ACE INA Holdings
8.20%; 08/15/04 225,000 229,152
Arch Capital Group
7.35%; 05/01/34 365,000 370,782
Infinity Property & Casualty /2/
5.50%; 02/18/14 335,000 323,826
Markel
6.80%; 02/15/13 330,000 345,458
St. Paul
5.75%; 03/15/07 475,000 505,145
W.R. Berkley
5.13%; 09/30/10 330,000 332,590
XL Capital
6.50%; 01/15/12 450,000 492,779
2,759,964
PUBLISHING-BOOKS (0.18%)
Reed Elsevier Capital
6.13%; 08/01/06 350,000 376,939
PUBLISHING-PERIODICALS (0.08%)
Dex Media East
12.13%; 11/15/12 150,000 174,000
RECREATIONAL CENTERS (0.12%)
AMF Bowling Worldwide /2/
10.00%; 03/01/10 250,000 259,375
REGIONAL BANKS (1.46%)
Bank One
7.63%; 08/01/05 725,000 773,544
KeyCorp
4.63%; 05/16/05 475,000 486,862
8.00%; 07/01/04 225,000 227,283
PNC Funding
5.75%; 08/01/06 650,000 689,885
Wachovia
5.63%; 12/15/08 600,000 635,438
6.38%; 02/01/09 100,000 109,116
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
REGIONAL BANKS (CONTINUED)
Wells Fargo
$ $
3.12%; 08/15/08 200,000 193,994
3,116,122
RENTAL-AUTO & EQUIPMENT (0.22%)
NationsRent /2/
9.50%; 10/15/10 315,000 337,837
United Rentals /2/
6.50%; 02/15/12 125,000 120,625
458,462
RESEARCH & DEVELOPMENT (0.06%)
Science Applications International
7.13%; 07/01/32 120,000 132,732
RETAIL-DRUG STORE (0.14%)
Rite Aid
12.50%; 09/15/06 250,000 287,500
RETAIL-RESTAURANTS (0.36%)
VICORP Restaurants /2/
10.50%; 04/15/11 200,000 198,000
Yum! Brands
7.70%; 07/01/12 485,000 560,871
758,871
RETAIL-VISION SERVICE CENTER (0.04%)
Cole National Group
8.63%; 08/15/07 75,000 76,313
RETAIL-VITAMINS & NUTRITIONAL SUPPLIES (0.16%)
General Nutrition Centers /2/
8.50%; 12/01/10 315,000 329,175
SAVINGS & LOANS-THRIFTS (0.29%)
Washington Mutual
3.97%; 03/25/33 528,000 519,762
5.50%; 01/15/13 100,000 101,649
621,411
SEMICONDUCTOR EQUIPMENT (0.09%)
Amkor Technology
7.75%; 05/15/13 200,000 197,000
SHIP BUILDING (0.14%)
Ship Finance International /2/
8.50%; 12/15/13 300,000 289,500
SOVEREIGN (0.80%)
Mexico Government
8.00%; 09/24/22 275,000 290,125
8.30%; 08/15/31 260,000 278,980
8.38%; 01/14/11 990,000 1,138,500
1,707,605
SPECIAL PURPOSE ENTITY (0.27%)
Farmers Exchange Capital /2/
7.05%; 07/15/28 225,000 218,409
Fondo Latinoamericano de Reservas /2/
3.00%; 08/01/06 270,000 270,242
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
SPECIAL PURPOSE ENTITY (CONTINUED)
PDVSA Finance
$ $
8.50%; 11/16/12 100,000 92,000
580,651
STEEL PRODUCERS (0.09%)
International Steel Group /2/
6.50%; 04/15/14 200,000 192,000
STEEL-SPECIALTY (0.16%)
CSN Islands VIII /2/
9.75%; 12/16/13 375,000 337,500
SUPRANATIONAL BANK (0.21%)
Corp Andina de Fomento
6.75%; 03/15/05 190,000 197,166
6.88%; 03/15/12 230,000 252,713
449,879
TELECOMMUNICATION SERVICES (0.17%)
IPCS /2/
11.50%; 05/01/12 200,000 203,000
MasTec
7.75%; 02/01/08 165,000 160,050
363,050
TELEPHONE-INTEGRATED (2.96%)
AT&T
6.00%; 03/15/09 130,000 130,183
British Telecommunications
7.88%; 12/15/05 940,000 1,017,390
Citizens Communications
7.63%; 08/15/08 250,000 260,189
Deutsche Telekom International Finance
5.25%; 07/22/13 580,000 575,733
8.50%; 06/15/10 /1/ 440,000 519,893
France Telecom /1/
8.75%; 03/01/11 505,000 597,010
MCI
6.69%; 05/01/09 175,000 166,250
Sprint Capital
6.13%; 11/15/08 100,000 107,078
6.88%; 11/15/28 560,000 549,775
6.90%; 05/01/19 100,000 103,483
8.75%; 03/15/32 230,000 274,738
Telecom Italia Capital /2/
4.00%; 11/15/08 220,000 218,075
5.25%; 11/15/13 555,000 547,189
6.38%; 11/15/33 130,000 127,507
Telefonica Europe
7.75%; 09/15/10 400,000 463,946
Telefonos de Mexico
4.50%; 11/19/08 /2/ 135,000 133,416
8.25%; 01/26/06 385,000 416,670
Verizon Florida
6.13%; 01/15/13 90,000 94,211
6,302,736
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
TEXTILE-HOME FURNISHINGS (0.07%)
Mohawk Industries
$ $
6.50%; 04/15/07 145,000 156,602
THEATERS (0.32%)
Cinemark /1/ /2/ /3/
0.00%; 03/15/14 270,000 169,087
Cinemark USA
8.50%; 08/01/08 490,000 508,375
677,462
TRANSPORT-RAIL (0.39%)
Union Pacific
4.70%; 01/02/24 100,000 96,588
5.75%; 10/15/07 690,000 736,541
833,129
TRANSPORT-SERVICES (0.16%)
CHC Helicopter /2/
7.38%; 05/01/14 150,000 151,875
FedEx /1/ /2/
1.39%; 04/01/05 190,000 189,968
341,843
VITAMINS & NUTRITION PRODUCTS (0.06%)
WH Holdings/WH Capital /2/
9.50%; 04/01/11 125,000 132,813
WIRE & CABLE PRODUCTS (0.09%)
Superior Essex Communications /2/
9.00%; 04/15/12 200,000 192,000
TOTAL BONDS 125,242,691
Principal
Type Rate Maturity Amount Value
- -------------------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) CERTIFICATES (20.76%)
$ $
FHLMC 4.50% 12/01/09 - 11/01/18 4,101,038 4,085,223
FHLMC /6/ 5.00% 01/01/18 - 06/01/34 13,657,803 13,475,734
FHLMC /4/ /6/ 5.50% 05/01/17 - 05/01/34 19,105,910 19,210,781
FHLMC 6.00% 03/01/22 - 12/01/31 2,813,862 2,887,346
FHLMC 6.50% 03/01/17 - 07/01/31 2,988,075 3,142,722
FHLMC 7.00% 12/01/29 - 12/01/30 455,066 480,721
FHLMC 7.50% 11/01/29 - 03/01/31 523,519 562,450
FHLMC 8.00% 09/01/30 363,083 392,300
TOTAL FHLMC CERTIFICATES 44,237,277
Principal
Type Rate Maturity Amount Value
- -------------------------------------------------------------------------------------------------------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) CERTIFICATES (9.13%)
$ $
FNMA 4.50% 05/01/33 - 08/01/33 3,860,776 3,627,615
FNMA 5.00% 03/01/18 - 06/01/18 4,092,642 4,121,471
FNMA 5.50% 07/01/33 - 09/01/33 4,086,977 4,080,630
FNMA /6/ 6.00% 05/01/09 - 05/01/34 3,783,503 3,907,714
FNMA 6.50% 01/01/11 - 09/01/32 3,235,993 3,399,837
FNMA 7.00% 08/01/29 - 02/01/32 286,706 303,139
TOTAL FNMA CERTIFICATES 19,440,406
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) CERTIFICATES (5.06%)
GNMA I 6.00% 12/15/33 629,760 646,032
GNMA I 6.50% 12/15/31 - 12/15/32 4,779,740 4,994,313
GNMA I 7.00% 06/15/32 917,610 975,491
GNMA I 7.50% 10/15/31 446,948 480,069
GNMA II 6.00% 07/20/28 - 07/20/29 2,291,834 2,351,000
GNMA II /6/ 6.50% 03/20/28 - 05/01/34 1,285,417 1,340,007
TOTAL GNMA CERTIFICATES 10,786,912
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
TREASURY BONDS (11.22%)
U.S. Treasury
$ $
4.00%; 02/15/14 1,100,000 1,056,687
5.38%; 02/15/31 2,055,000 2,081,972
6.13%; 08/15/29 25,000 27,604
6.25%; 08/15/23 2,300,000 2,555,696
6.25%; 05/15/30 1,310,000 1,472,164
6.75%; 08/15/26 1,000,000 1,179,727
7.50%; 11/15/16 2,145,000 2,666,754
8.00%; 11/15/21 760,000 1,001,181
U.S. Treasury Inflation-Indexed Obligations
2.00%; 01/15/14 2,216,984 2,201,223
3.38%; 01/15/07 1,292,764 1,393,963
3.50%; 01/15/11 2,375,045 2,645,669
3.63%; 01/15/08 2,558,661 2,815,226
3.88%; 01/15/09 2,497,814 2,801,161
TOTAL TREASURY BONDS 23,899,027
Shares
Held Value
- -------------------------------------------------------------------------------------------------------------
COMMON STOCKS (0.00%)
COMPUTER SERVICES (0.00%)
$
Decisionone /3/ 3,500 -
Decisionone /3/ 2,054 -
Decisionone /3/ 3,540 -
Decisionone /3/ 2,100 -
-
TOTAL COMMON STOCKS -
Shares
Held Value
- -------------------------------------------------------------------------------------------------------------
PREFERRED STOCKS (0.22%)
CABLE TV (0.22%)
Cablevision Systems 4,400 459,800
TOTAL PREFERRED STOCKS 459,800
Principal
Amount Value
- -------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (5.77%)
DIVERSIFIED FINANCIAL SERVICES (5.00%)
Investment in Joint Trading Account; Citigroup
$ $
1.02%; 05/03/04 10,656,400 10,656,400
TELEPHONE-INTEGRATED (0.77%)
BellSouth
1.02%; 05/03/04 1,645,000 1,644,908
TOTAL COMMERCIAL PAPER 12,301,308
SCHEDULE OF INVESTMENTS
PRINCIPAL BOND FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Maturity
Amount Value
- ---------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (0.19%)
Deutsche Bank; 1.02%; dated 04/30/04
maturing 05/03/04 (collateralized by
FHLMC; $403,550; 02/15/07) /7/ $395,671 $ 395,638
TOTAL REPURCHASE AGREEMENTS 395,638
------------
TOTAL PORTFOLIO INVESTMENTS (111.14%) 236,763,059
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER
ASSETS (-11.14%) (23,731,691)
TOTAL NET ASSETS (100.00%) $213,031,368
---------------
Notional Unrealized
Description Amount Gain (Loss)
- ----------------------------------------------------------------------------
SWAP AGREEMENTS
TOTAL RETURN SWAPS
Receive monthly a return equal to the Lehman $9,000,000 $(297,832)
ERISA Eligible CMBS Index and pay monthly a
floating rate based on 1-month LIBOR less 45
basis points with Morgan Stanley. Expires August
2004.
/1 /Variable rate.
/2 /Restricted Security - The fund held securities which may require
registration under the Securities Act of 1933, or an exemption therefrom, in
order to effect their sale in the ordinary course of business. At the end of
the period, restricted securities totaled $15,069,719 or 7.07% of net assets.
/3 /Non-income producing security.
/4 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors.
/5 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/6 /Security or a portion of the security was purchased in a "to-be-announced"
("TBA") transaction. See Notes to Financial Statements.
/7 /Security was purchased with the cash proceeds from securities loans.
74
See accompanying notes.
SCHEDULE OF INVESTMENTS
PRINCIPAL CAPITAL VALUE FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ----------------------------------------------------------------------------------------------
COMMON STOCKS (99.18%)
ADVERTISING AGENCIES (0.99%)
$
Omnicom Group 44,250 3,518,318
AEROSPACE & DEFENSE EQUIPMENT (1.16%)
General Dynamics 44,040 4,123,025
AGRICULTURAL OPERATIONS (1.72%)
Monsanto 176,160 6,093,374
APPLICATIONS SOFTWARE (0.63%)
Citrix Systems /1/ 117,000 2,228,850
AUDIO & VIDEO PRODUCTS (0.66%)
Polycom /1/ 123,520 2,356,762
AUTO-MEDIUM & HEAVY DUTY TRUCKS (1.45%)
Paccar 91,291 5,154,290
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (1.63%)
American Axle & Manufacturing Holdings /1/ 79,070 3,041,823
Dana 136,300 2,747,808
5,789,631
BEVERAGES-NON-ALCOHOLIC (1.13%)
Coca-Cola 79,460 4,018,292
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.85%)
Florida Rock Industries 75,860 3,018,469
BUILDING-RESIDENTIAL & COMMERCIAL (1.36%)
Centex 100,994 4,842,662
CASINO HOTELS (0.79%)
Mandalay Resort Group 48,900 2,809,305
CELLULAR TELECOMMUNICATIONS (2.53%)
Nextel Communications /1/ 301,400 7,191,404
Western Wireless /1/ 86,270 1,796,141
8,987,545
COATINGS & PAINT (0.91%)
Valspar 64,670 3,210,866
COMMERCIAL BANKS (4.33%)
Hudson United Bancorp 56,990 2,036,253
Marshall & Ilsley 104,160 3,829,963
North Fork Bancorp. 86,650 3,216,448
UnionBanCal 59,400 3,173,742
Zions Bancorp 54,900 3,102,948
15,359,354
COMPUTERS-MEMORY DEVICES (1.58%)
SanDisk /1/ 85,780 1,982,376
Veritas Software /1/ 136,110 3,630,053
5,612,429
CONTAINERS-METAL & GLASS (1.13%)
Ball 60,490 3,992,340
COSMETICS & TOILETRIES (4.29%)
Avon Products 42,890 3,602,760
Colgate-Palmolive 51,800 2,998,184
International Flavors & Fragrances 91,200 3,306,000
Shares
Held Value
- ----------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COSMETICS & TOILETRIES (CONTINUED)
$
Procter & Gamble 50,110 5,299,132
15,206,076
DIVERSIFIED FINANCIAL SERVICES (4.81%)
Citigroup /2/ 355,230 17,083,011
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (1.62%)
Cendant 243,110 5,756,845
E-COMMERCE-PRODUCTS (0.65%)
Amazon.com /1/ 53,100 2,307,726
ELECTRIC-INTEGRATED (5.51%)
Constellation Energy Group 91,330 3,514,378
Edison International 190,700 4,462,380
Exelon 65,500 4,384,570
Great Plains Energy 110,200 3,439,342
TXU 109,600 3,741,744
19,542,414
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.94%)
Sanmina /1/ 331,900 3,325,638
ELECTRONIC COMPONENTS-SEMICONDUCTOR (0.96%)
International Rectifier /1/ 85,780 3,400,319
ELECTRONIC MEASUREMENT INSTRUMENTS (0.70%)
Agilent Technologies /1/ 91,330 2,466,823
ELECTRONIC PARTS DISTRIBUTION (0.70%)
Avnet /1/ 115,150 2,491,846
FINANCE-CREDIT CARD (1.01%)
Capital One Financial 54,750 3,587,768
FINANCE-INVESTMENT BANKER & BROKER (4.22%)
Goldman Sachs Group 45,040 4,346,360
Lehman Brothers Holdings 53,247 3,908,330
Merrill Lynch 124,130 6,731,570
14,986,260
FINANCIAL GUARANTEE INSURANCE (1.02%)
Ambac Financial Group 52,675 3,634,575
FOOD-FLOUR & GRAIN (1.05%)
Archer Daniels Midland 212,120 3,724,827
FOOD-MISCELLANEOUS/DIVERSIFIED (0.93%)
Kellogg 76,800 3,294,720
LIFE & HEALTH INSURANCE (0.73%)
Lincoln National 57,770 2,592,718
MACHINERY-CONSTRUCTION & MINING (0.79%)
Caterpillar 35,900 2,790,507
MACHINERY-FARM (1.26%)
Deere 65,650 4,466,826
MEDICAL-BIOMEDICAL/GENE (1.06%)
Amgen /1/ 67,000 3,770,090
MEDICAL-GENERIC DRUGS (1.50%)
Eon Labs /1/ 41,140 2,704,955
Shares
Held Value
- ----------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-GENERIC DRUGS (CONTINUED)
$
Watson Pharmaceutical /1/ 73,400 2,613,774
5,318,729
METAL PROCESSORS & FABRICATION (0.77%)
Precision Castparts 60,980 2,744,710
MISCELLANEOUS INVESTING (1.55%)
General Growth Properties 99,500 2,697,445
Kimco Realty 65,260 2,789,212
5,486,657
MONEY CENTER BANKS (5.08%)
Bank of America /2/ 134,296 10,809,485
JP Morgan Chase 192,400 7,234,240
18,043,725
MULTI-LINE INSURANCE (5.53%)
Allstate 127,820 5,866,938
American International Group 76,400 5,474,060
Hartford Financial Services 62,970 3,846,208
Prudential Financial 101,118 4,443,125
19,630,331
MULTIMEDIA (1.75%)
Belo 95,000 2,703,700
Media General 48,600 3,493,368
6,197,068
OIL COMPANY-EXPLORATION & PRODUCTION (3.33%)
Burlington Resources 51,150 3,440,861
Chesapeake Energy 308,946 4,248,007
Cimarex Energy /1/ 53,880 1,486,549
Pogo Producing 53,590 2,643,059
11,818,476
OIL COMPANY-INTEGRATED (7.48%)
ChevronTexaco 41,780 3,822,870
ConocoPhillips 68,170 4,860,521
Exxon Mobil /2/ 261,703 11,135,462
Marathon Oil 85,700 2,876,092
Occidental Petroleum 81,159 3,830,705
26,525,650
PIPELINES (0.80%)
Questar 79,635 2,824,653
REGIONAL BANKS (2.74%)
Wachovia 154,930 7,088,047
Wells Fargo 46,560 2,628,778
9,716,825
RESPIRATORY PRODUCTS (0.69%)
Respironics /1/ 46,390 2,431,300
RETAIL-APPAREL & SHOE (0.45%)
Pacific Sunwear of California /1/ 74,980 1,609,821
RETAIL-DISCOUNT (1.01%)
Wal-Mart Stores 62,800 3,579,600
RETAIL-DRUG STORE (1.50%)
CVS 99,750 3,853,342
Shares
Held Value
- ----------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-DRUG STORE (CONTINUED)
$
Rite Aid /1/ 298,880 1,464,512
5,317,854
RETAIL-REGIONAL DEPARTMENT STORE (1.94%)
Federated Department Stores 108,640 5,323,360
Neiman Marcus Group 32,420 1,576,909
6,900,269
RETAIL-RESTAURANTS (1.22%)
McDonald's 159,160 4,333,927
SAVINGS & LOANS-THRIFTS (0.58%)
Independence Community Bank 56,800 2,069,224
TELECOMMUNICATION SERVICES (0.41%)
PTEK Holdings /1/ /3/ 141,325 1,437,275
TELEPHONE-INTEGRATED (2.16%)
BellSouth 69,920 1,804,635
IDT /1/ 65,600 1,216,224
Telephone & Data Systems 3,795 250,318
Verizon Communications 116,382 4,392,257
7,663,434
TELEVISION (0.55%)
Hearst-Argyle Television 75,000 1,968,750
TOBACCO (1.04%)
Altria Group 66,700 3,693,846
TOYS (0.83%)
Hasbro 155,420 2,935,884
TRANSPORT-SERVICES (1.17%)
FedEx 57,970 4,168,623
TOTAL COMMON STOCKS 351,961,132
Principal
Amount Value
- ----------------------------------------------------------------------------------------------
COMMERCIAL PAPER (0.79%)
FINANCE-INVESTMENT BANKER & BROKER (0.79%)
Investment in Joint Trading Account;
Citigroup
$ $
1.02%; 05/03/04 2,809,046 2,809,046
TOTAL COMMERCIAL PAPER 2,809,046
Maturity
Amount Value
- ----------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (0.42%)
Goldman Sachs; 0.93%; dated 04/30/04
maturing 05/03/04 (collateralized by U.S.
Treasury Strips; $1,531,022; 02/15/06 -
08/15/26) /4/ $ 1,501,116 $ 1,501,000
TOTAL REPURCHASE AGREEMENTS 1,501,000
------------
TOTAL PORTFOLIO INVESTMENTS (100.39%) 356,271,178
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER ASSETS
(-0.39%) (1,400,485)
TOTAL NET ASSETS (100.00%) $354,870,693
---------------
SCHEDULE OF INVESTMENTS
PRINCIPAL CAPITAL VALUE FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Unrealized
Contract Opening Current Gain (Loss)
Type Commitment Market Value Market Value
- ---------------------------------------------------------------------
FUTURES CONTRACTS
8 Russell 1000 Buy $2,396,000 $2,365,200 $(30,800)
June, 2004
Futures
/1 /Non-income producing security.
/2 /Security or a portion of the security was pledged to cover margin
requirements for futures contracts.
/3 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/4 /Security was purchased with the cash proceeds from securities loans.
See accompanying notes.
77
SCHEDULE OF INVESTMENTS
PRINCIPAL CASH MANAGEMENT FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Principal
Amount Value
- ---------------------------------------------------------------------------------------
COMMERCIAL PAPER (93.16%)
ASSET BACKED SECURITIES (16.35%)
CAFCO
$ $
1.02%; 05/25/04 1,795,000 1,793,779
1.03%; 06/29/04 2,000,000 1,996,624
1.04%; 05/10/04 740,000 739,808
CRC Funding
1.04%; 05/20/04 2,000,000 1,998,902
1.05%; 06/23/04 1,355,000 1,352,905
1.06%; 07/19/04 2,500,000 2,494,185
CXC
1.03%; 05/05/04 2,640,000 2,639,698
1.04%; 05/20/04 2,500,000 2,498,628
1.04%; 05/21/04 2,000,000 1,998,844
FCAR Owner Trust I
1.04%; 07/07/04 1,625,000 1,621,855
1.05%; 06/08/04 1,500,000 1,498,337
1.05%; 06/16/04 2,900,000 2,896,109
1.08%; 07/02/04 2,200,000 2,195,908
1.10%; 07/06/04 770,000 768,490
1.10%; 08/03/04 2,100,000 2,093,968
Receivables Capital
1.03%; 05/26/04 2,640,000 2,638,112
1.03%; 06/10/04 1,555,000 1,553,220
1.04%; 06/01/04 1,300,000 1,298,836
1.04%; 06/03/04 2,400,000 2,397,712
1.17%; 06/01/04 1,070,000 1,068,922
Windmill Funding
1.03%; 05/07/04 2,400,000 2,399,588
1.03%; 05/26/04 1,300,000 1,299,070
1.07%; 07/21/04 3,000,000 2,992,777
Yorktown Capital
1.03%; 06/16/04 2,750,000 2,746,381
1.03%; 06/17/04 3,850,000 3,844,823
1.05%; 05/04/04 2,335,000 2,334,796
53,162,277
COMMERCIAL BANKS (7.16%)
Nordea North America
1.03%; 06/23/04 3,000,000 2,995,451
1.04%; 06/01/04 2,000,000 1,998,217
1.04%; 06/04/04 2,310,000 2,307,742
1.04%; 07/29/04 1,100,000 1,097,172
1.09%; 09/07/04 2,600,000 2,589,845
1.13%; 05/05/04 2,000,000 1,999,749
Svenska Handelsbanken
1.03%; 05/24/04 2,700,000 2,698,223
1.03%; 05/28/04 4,900,000 4,896,215
1.08%; 07/28/04 2,700,000 2,692,905
23,275,519
CONSUMER PRODUCTS-MISCELLANEOUS (1.15%)
Fortune Brands
1.00%; 05/03/04 2,000,000 1,999,889
1.02%; 06/10/04 1,725,000 1,723,045
3,722,934
DISTRIBUTION-WHOLESALE (0.80%)
Louis Dreyfus
1.03%; 05/12/04 2,600,000 2,599,182
Principal
Amount Value
- ---------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONTINUED)
DIVERSIFIED FINANCIAL SERVICES (6.97%)
Amstel Funding
$ $
1.05%; 05/14/04 2,000,000 1,999,242
1.05%; 05/17/04 1,940,000 1,939,099
1.05%; 08/12/04 1,000,000 996,996
1.07%; 07/23/04 1,600,000 1,596,053
1.15%; 09/22/04 2,300,000 2,289,420
1.26%; 10/27/04 2,000,000 1,987,470
Citigroup
1.04%; 06/24/04 2,000,000 1,996,880
General Electric Capital
1.03%; 06/21/04 2,370,000 2,366,542
1.07%; 05/13/04 2,070,000 2,069,262
1.07%; 07/16/04 2,000,000 1,995,482
1.08%; 09/01/04 255,000 254,059
1.10%; 08/17/04 1,605,000 1,599,703
1.11%; 08/13/04 1,585,000 1,579,917
22,670,125
FINANCE-COMMERCIAL (3.13%)
CIT Group
1.05%; 05/24/04 1,900,000 1,898,725
1.05%; 06/23/04 2,000,000 1,996,908
1.07%; 07/21/04 2,000,000 1,995,185
1.09%; 08/10/04 2,400,000 2,392,661
1.18%; 10/25/04 1,900,000 1,888,977
10,172,456
FINANCE-CONSUMER LOANS (5.08%)
American General Finance
1.04%; 06/25/04 2,370,000 2,366,234
1.04%; 07/20/04 2,150,000 2,145,055
1.06%; 06/17/04 2,600,000 2,596,504
1.06%; 07/23/04 700,000 698,298
1.06%; 07/26/04 2,100,000 2,094,682
Household Finance
1.02%; 05/11/04 2,000,000 1,999,433
1.04%; 05/14/04 1,800,000 1,799,324
1.05%; 05/21/04 2,800,000 2,798,367
16,497,897
FINANCE-CREDIT CARD (1.26%)
American Express Credit
1.01%; 05/13/04 2,000,000 1,999,327
1.01%; 05/27/04 2,090,000 2,088,475
4,087,802
FINANCE-INVESTMENT BANKER & BROKER (14.00%)
Bear Stearns
1.04%; 05/19/04 2,700,000 2,698,596
1.04%; 05/26/04 2,000,000 1,998,555
1.06%; 07/14/04 2,600,000 2,594,335
1.07%; 08/04/04 2,000,000 1,994,353
BNP Paribas Finance
1.10%; 09/13/04 2,600,000 2,589,275
Citigroup Global Markets
Holdings
1.02%; 05/06/04 1,400,000 1,399,802
1.03%; 05/10/04 2,760,000 2,759,293
1.04%; 05/06/04 2,800,000 2,799,595
1.04%; 05/20/04 1,030,000 1,029,435
Principal
Amount Value
- ---------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONTINUED)
FINANCE-INVESTMENT BANKER & BROKER (CONTINUED)
Citigroup Global Markets
Holdings (continued)
$ $
1.04%; 06/17/04 1,100,000 1,098,506
1.04%; 07/12/04 2,475,000 2,469,852
1.05%; 07/01/04 2,260,000 2,255,979
Goldman Sachs Group
1.03%; 05/14/04 1,670,000 1,669,379
1.08%; 05/27/04 2,800,000 2,797,816
1.13%; 08/25/04 2,000,000 1,992,718
1.15%; 05/17/04 2,100,000 2,098,927
1.17%; 05/25/04 2,800,000 2,797,816
ING U.S. Funding
1.03%; 06/02/04 1,500,000 1,498,627
1.03%; 07/09/04 2,800,000 2,794,472
JP Morgan
1.03%; 06/02/04 1,300,000 1,298,810
Morgan Stanley Group
1.03%; 05/18/04 1,175,000 1,174,428
1.03%; 05/27/04 1,700,000 1,698,735
45,509,304
FINANCE-LEASING COMPANY (4.66%)
International Lease Finance
1.02%; 06/11/04 2,800,000 2,796,747
1.03%; 05/21/04 2,000,000 1,998,856
1.04%; 05/05/04 2,500,000 2,499,711
1.04%; 05/12/04 2,955,000 2,954,070
1.04%; 07/13/04 2,600,000 2,594,543
River Fuel Funding
1.05%; 06/24/04 2,300,000 2,296,378
15,140,305
FINANCE-MORTGAGE LOAN/BANKER (2.47%)
Federal Home Loan Mortgage
1.06%; 08/12/04 1,700,000 1,694,869
1.06%; 08/24/04 2,535,000 2,526,416
1.07%; 09/09/04 2,000,000 1,992,213
Federal National Mortgage
Association
1.07%; 07/28/04 1,835,000 1,830,200
8,043,698
FINANCE-OTHER SERVICES (12.09%)
Caterpillar Financial Services
1.15%; 05/03/04 2,015,000 2,014,871
Commoloco
1.02%; 05/18/04 2,435,000 2,433,827
1.04%; 05/18/04 2,000,000 1,999,018
1.04%; 06/28/04 1,725,000 1,722,110
1.05%; 07/06/04 2,500,000 2,495,188
1.06%; 07/14/04 2,100,000 2,095,446
1.07%; 08/11/04 2,100,000 2,093,634
Delaware Funding
1.03%; 06/03/04 900,000 899,150
1.04%; 05/04/04 2,000,000 1,999,827
1.04%; 06/07/04 2,600,000 2,597,221
Private Export Funding
1.01%; 05/17/04 2,020,000 2,019,093
1.03%; 06/15/04 2,500,000 2,496,781
1.03%; 08/16/04 3,775,000 3,763,443
Principal
Amount Value
- ---------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONTINUED)
FINANCE-OTHER SERVICES (CONTINUED)
Private Export Funding
(continued)
$ $
1.04%; 05/28/04 2,200,000 2,198,284
1.04%; 07/08/04 2,010,000 2,006,051
1.05%; 06/29/04 2,500,000 2,495,718
Sheffield Receivables
1.03%; 05/25/04 1,985,000 1,983,637
1.04%; 05/13/04 2,000,000 1,999,307
39,312,606
INSURANCE BROKERS (2.38%)
Marsh & McLennan
1.01%; 05/11/04 2,550,000 2,549,292
1.05%; 07/07/04 5,200,000 5,189,838
7,739,130
MEDICAL-DRUGS (0.61%)
Pfizer
1.20%; 10/13/04 2,000,000 1,988,817
MONEY CENTER BANKS (10.51%)
Bank of America
1.03%; 06/30/04 2,800,000 2,795,193
1.04%; 05/07/04 2,900,000 2,899,497
1.04%; 06/03/04 2,000,000 2,000,000
1.06%; 05/11/04 2,000,000 1,999,411
Citicorp
1.03%; 06/22/04 3,000,000 2,995,537
1.04%; 06/18/04 2,155,000 2,152,012
HBOS Treasury Services
1.03%; 06/09/04 2,000,000 1,997,769
1.04%; 05/17/04 780,000 779,636
1.04%; 05/24/04 1,300,000 1,299,136
1.05%; 06/21/04 2,080,000 2,076,906
1.05%; 07/09/04 1,150,000 1,147,686
1.07%; 06/04/04 260,000 259,737
1.08%; 08/05/04 2,000,000 1,994,240
1.08%; 08/19/04 1,400,000 1,395,380
1.10%; 08/02/04 1,800,000 1,794,885
JP Morgan Chase
1.04%; 05/06/04 2,900,000 2,899,581
1.04%; 05/12/04 1,700,000 1,699,460
1.04%; 06/21/04 2,000,000 1,997,053
34,183,119
RETAIL-DISCOUNT (0.61%)
Wal-Mart Stores
1.09%; 08/17/04 2,000,000 1,993,460
SPECIAL PURPOSE ENTITY (0.99%)
Cortez Capital
1.02%; 05/04/04 1,315,000 1,314,888
White Pine Finance
1.05%; 06/28/04 1,910,000 1,906,738
3,221,626
SUPRANATIONAL BANK (0.68%)
Corp Andina de Fomento
1.04%; 05/19/04 2,200,000 2,198,856
Principal
Amount Value
- ---------------------------------------------------------------------------------------
COMMERCIAL PAPER (CONTINUED)
TELEPHONE COMMUNICATION (1.03%)
Telstra
$ $
1.02%; 06/30/04 3,365,000 3,359,111
TELEPHONE-INTEGRATED (1.23%)
BellSouth
1.02%; 05/03/04 2,000,000 1,999,886
1.02%; 05/10/04 2,000,000 1,999,490
3,999,376
TOTAL COMMERCIAL PAPER 302,877,600
Principal
Amount Value
- ---------------------------------------------------------------------------------------
BONDS (7.16%)
AEROSPACE & DEFENSE EQUIPMENT (0.63%)
United Technologies
6.63%; 11/15/04 2,000,000 2,054,367
COMMERCIAL BANKS (0.63%)
Svenska Handelsbanken
8.35%; 07/15/04 2,000,000 2,029,729
FINANCE-INVESTMENT BANKER & BROKER (1.05%)
Bear Stearns
6.65%; 12/01/04 1,292,000 1,332,262
Lehman Brothers Holdings
7.75%; 01/15/05 2,000,000 2,090,269
3,422,531
FINANCE-MORTGAGE LOAN/BANKER (0.40%)
Federal Home Loan Bank
1.66%; 05/16/05 1,300,000 1,300,000
FINANCE-OTHER SERVICES (2.27%)
Caterpillar Financial Services
6.88%; 08/01/04 2,000,000 2,028,106
Newcourt Credit Group
6.88%; 02/16/05 1,300,000 1,356,397
Verizon Global Funding /1/
1.22%; 06/15/04 4,000,000 4,000,000
7,384,503
INSURANCE BROKERS (0.46%)
Marsh & McLennan
6.63%; 06/15/04 1,500,000 1,509,642
MONEY CENTER BANKS (0.47%)
Bank of America
7.75%; 08/15/04 1,500,000 1,527,100
REGIONAL BANKS (0.63%)
Bank One
7.25%; 08/15/04 2,000,000 2,033,566
Principal
Amount Value
- ---------------------------------------------------------------------------------------
BONDS (CONTINUED)
TELEPHONE-INTEGRATED (0.62%)
SBC Communications
$ $
4.18%; 06/05/04 2,000,000 2,005,625
TOTAL BONDS 23,267,063
------------
TOTAL PORTFOLIO INVESTMENTS (100.32%) 326,144,663
LIABILITIES, NET OF
CASH, RECEIVABLES
AND OTHER ASSETS
(-0.32%) (1,024,818)
TOTAL NET ASSETS (100.00%) $325,119,845
---------------
80
See accompanying notes.
SCHEDULE OF INVESTMENTS
PRINCIPAL EQUITY INCOME FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (68.37%)
APPLIANCES (0.66%)
$
Whirlpool 7,300 478,223
BEVERAGES-NON-ALCOHOLIC (0.70%)
Coca-Cola 9,900 500,643
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.68%)
Masco 17,400 487,374
COMMERCIAL BANKS (2.24%)
S&T Bancorp 28,400 807,412
Trustco Bank 63,700 803,257
1,610,669
COMPUTER SERVICES (0.67%)
Electronic Data Systems 26,300 481,027
COMPUTERS (0.64%)
Hewlett-Packard 23,400 460,980
DIVERSIFIED MANUFACTURING OPERATIONS (0.45%)
Futuris 300,000 327,157
ELECTRIC-INTEGRATED (12.52%)
Alliant Energy 23,900 594,154
American Electric Power 35,900 1,092,796
Constellation Energy Group 25,000 962,000
Energy East 62,600 1,474,230
Entergy 20,200 1,102,920
Exelon 20,900 1,399,046
Great Plains Energy 25,200 786,492
Public Service Enterprise Group 18,000 772,200
WPS Resources 18,000 824,580
9,008,418
ELECTRIC-TRANSMISSION (1.07%)
National Grid Group 20,000 767,800
FINANCE-CREDIT CARD (0.66%)
MBNA 19,500 475,410
FINANCE-INVESTMENT BANKER & BROKER (1.67%)
Friedman, Billings, Ramsey Group 64,800 1,198,800
FINANCE-MORTGAGE LOAN/BANKER (3.37%)
American Home Mortgage Investment 70,500 1,672,965
Charter Mac 38,200 748,338
2,421,303
GAS-DISTRIBUTION (2.32%)
New Jersey Resources 20,850 794,593
Sempra Energy 27,500 873,125
1,667,718
HOME FURNISHINGS (1.31%)
Bassett Furniture Industries 52,400 940,056
INVESTMENT COMPANIES (1.30%)
Apollo Investment 41,355 568,631
MCG Capital 22,900 368,003
936,634
MEDICAL-DRUGS (0.81%)
Orion OYJ 22,800 586,261
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
METAL-COPPER (0.65%)
$
Southern Peru Copper 16,200 470,286
MISCELLANEOUS INVESTING (15.54%)
Arden Realty 15,000 423,300
Brandywine Realty Trust 8,400 212,856
Colonial Properties Trust 6,000 211,680
Commercial Net Lease Realty 12,400 205,716
Equity Office Properties Trust 8,400 211,428
Equity One 40,300 660,920
Equity Residential Properties Trust 7,400 203,204
Health Care 18,700 597,278
Health Care Property Investors 10,800 258,120
Healthcare Realty Trust 17,800 638,130
Home Properties of New York 5,400 201,636
Hospitality Properties Trust 17,700 691,716
iStar Financial 41,600 1,478,464
Keystone Property Trust 31,600 642,744
Lexington Corporate Properties Trust 35,800 661,942
Mack-Cali Realty 5,600 209,160
Maguire Properties 19,000 433,010
Mid-America Apartment Communities 21,000 677,250
New Plan Excel Realty Trust 27,200 610,368
Prentiss Properties Trust 6,800 217,872
Sovran Self Storage 6,300 212,751
Summit Properties 31,400 710,582
Tanger Factory Outlet Centers 15,300 584,460
United Dominion Realty Trust 12,400 222,580
11,177,167
MONEY CENTER BANKS (1.75%)
ABN AMRO Holding 37,500 815,450
Bank of America 5,500 442,695
1,258,145
MULTI-LINE INSURANCE (0.68%)
Allstate 10,700 491,130
NON-FERROUS METALS (1.19%)
USEC 124,200 854,496
NON-HAZARDOUS WASTE DISPOSAL (0.66%)
Waste Management 16,800 477,120
OFFICE SUPPLIES & FORMS (1.13%)
Ennis Business Forms 54,100 810,959
OIL COMPANY-EXPLORATION & PRODUCTION (0.67%)
Kerr-McGee 9,800 479,514
OIL COMPANY-INTEGRATED (3.13%)
ChevronTexaco 7,700 704,550
ENI 42,000 853,894
Marathon Oil 20,700 694,692
2,253,136
PAPER & RELATED PRODUCTS (0.63%)
Weyerhaeuser 7,700 455,840
PIPELINES (0.57%)
Kinder Morgan 6,800 409,428
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PRINTING-COMMERCIAL (0.95%)
$
R.R. Donnelley & Sons 23,200 682,544
PROPERTY TRUST (1.22%)
Westfield Trust 300,000 879,640
REAL ESTATE MANAGEMENT & SERVICES (0.71%)
Castellum 23,500 509,101
REAL ESTATE OPERATOR & DEVELOPER (1.12%)
Land Securities Group 41,390 805,921
REGIONAL BANKS (1.13%)
Comerica 15,700 810,591
TELEPHONE-INTEGRATED (2.92%)
BellSouth 28,550 736,876
SBC Communications 19,700 490,530
Verizon Communications 23,214 876,096
2,103,502
TOBACCO (1.40%)
Altria Group 18,200 1,007,916
WATER (1.25%)
Suez 45,000 901,940
TOTAL COMMON STOCKS 49,186,849
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
PREFERRED STOCKS (17.53%)
CELLULAR TELECOMMUNICATIONS (1.83%)
U.S. Cellular 48,000 1,320,000
COMMERCIAL BANKS (2.47%)
CoBank /1/ 35,300 1,780,250
ELECTRIC-INTEGRATED (2.69%)
Consolidated Edison 7,556 196,985
DTE Energy Trust I 9,140 237,640
Entergy Louisiana 39,580 1,029,080
OGE Energy Capital Trust I 18,326 469,145
1,932,850
FINANCE-AUTO LOANS (1.06%)
Ford Motor Capital Trust II 13,530 763,498
FOOD-DAIRY PRODUCTS (0.50%)
Dairy Farmers of America /1/ 3,500 361,266
GAS-DISTRIBUTION (2.61%)
AGL Capital Trust II 25,385 656,202
KeySpan 23,500 1,219,180
1,875,382
MISCELLANEOUS INVESTING (1.02%)
HRPT Properties Trust Series B 28,000 733,600
MULTI-LINE INSURANCE (0.62%)
Hartford Financial Services Group 7,330 447,057
Shares
Held Value
- ------------------------------------------------------------------------------------------------------
PREFERRED STOCKS (CONTINUED)
OIL COMPANY-INTEGRATED (0.99%)
$
Unocal Capital Trust 13,730 715,676
PIPELINES (1.18%)
TransCanada PipeLines 33,457 846,462
TELEPHONE-INTEGRATED (2.56%)
ALLTEL 29,800 1,485,530
Telephone & Data Systems 13,700 353,734
1,839,264
TOTAL PREFERRED STOCKS 12,615,305
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
BONDS (8.98%)
CELLULAR TELECOMMUNICATIONS (0.67%)
Nextel Communications
$ $
5.25%; 01/15/10 480,000 483,600
ELECTRIC-INTEGRATED (1.72%)
Georgia Power Capital Trust VI
4.88%; 11/01/42 1,200,000 1,234,895
OIL COMPANY-INTEGRATED (2.22%)
Phillips 66 Capital Trust II
8.00%; 01/15/37 1,475,000 1,596,369
PIPELINES (4.37%)
KN Capital Trust III
7.63%; 04/15/28 2,900,000 3,145,453
TOTAL BONDS 6,460,317
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (2.88%)
FINANCE-MORTGAGE LOAN/BANKER (2.88%)
Investment in Joint Trading Account; Federal Home
Loan Bank
0.90%; 05/03/04 $ 2,074,228 $ 2,074,124
TOTAL COMMERCIAL PAPER 2,074,124
-----------
TOTAL PORTFOLIO INVESTMENTS (97.76%) 70,336,595
CASH, RECEIVABLES AND OTHER ASSETS, NET OF
LIABILITIES (2.24%) 1,610,508
TOTAL NET ASSETS (100.00%) $71,947,103
-------------
/1 /Restricted Security - The fund held securities which may require
registration under the Securities Act of 1933, or an exemption therefrom, in
order to effect their sale in the ordinary course of business. At the end of
the period, restricted securities totaled $2,141,516 or 2.98% of net assets.
See accompanying notes.
83
SCHEDULE OF INVESTMENTS
PRINCIPAL GOVERNMENT SECURITIES INCOME FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Principal
Amount Value
--------------------------------------------------------------------------------------------------------------------
BONDS (17.70%)
FEDERAL & FEDERALLY SPONSORED CREDIT (2.93%)
Federal Farm Credit Bank
$ $
2.50%; 03/15/06 10,024,260
FINANCE-MORTGAGE LOAN/BANKER (13.92%)
Federal Home Loan Bank
1.88%; 06/15/06 4,000,000 3,944,080
2.50%; 03/15/06 10,024,260
Federal Home Loan Mortgage
1.88%; 02/15/06 16,000,000 15,876,432
Federal National Mortgage Association
2.13%; 04/15/06 9,926,780
2.63%; 11/15/06 /1/ 4,000,000 3,977,620
3.07%; 02/17/09 /1/ /2/ 4,000,000 3,961,040
47,710,212
FINANCE-OTHER SERVICES (0.85%)
Private Export Funding
3.38%; 02/15/09 3,000,000 2,927,094
TOTAL BONDS 60,661,566
Principal
Type Rate Maturity Amount Value
- --------------------------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) CERTIFICATES (7.03%)
$ $
FHLMC /1/ 3.50% 09/15/07 5,000,000 5,030,620
FHLMC 5.00% 05/01/18 9,290,803 9,364,247
FHLMC 5.50% 12/01/33 9,686,138 9,679,804
TOTAL FHLMC CERTIFICATES 24,074,671
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) CERTIFICATES (70.14%)
GNMA I 5.00% 06/15/33 - 08/15/33 32,646,564 31,764,095
GNMA I 5.50% 12/15/13 - 05/15/33 45,111,895 45,218,687
GNMA I 6.00% 03/15/17 - 10/15/32 30,099,681 30,984,230
GNMA I 6.50% 07/15/08 - 04/15/32 12,589,478 13,239,570
GNMA I 7.00% 10/15/22 - 06/15/32 23,443,595 24,979,771
GNMA I 7.25% 09/15/25 - 10/15/25 577,489 620,119
GNMA I 7.50% 04/15/17 - 05/15/31 10,231,454 11,021,211
GNMA I 8.00% 08/15/16 - 04/15/31 3,691,034 4,040,318
GNMA II /2/ 2.88% 10/20/30 8,628,697 8,563,610
GNMA II 5.00% 05/20/33 19,291,027 18,745,457
GNMA II 5.50% 07/20/14 - 09/20/33 43,210,376 43,237,690
GNMA II 6.00% 01/20/24 - 06/20/26 4,143,309 4,256,482
GNMA II 6.50% 03/20/24 - 05/01/34 3,572,388 3,729,363
TOTAL GNMA CERTIFICATES 240,400,603
Principal
Amount Value
- --------------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (4.07%)
FINANCE-MORTGAGE LOAN/BANKER (4.07%)
Investment in Joint Trading Account; Federal Home Loan Bank
$ $
0.90%; 05/03/04 13,947,198 13,946,501
TOTAL COMMERCIAL PAPER 13,946,501
Maturity
Amount Value
- --------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (3.69%)
Goldman Sachs; 0.93%; dated 04/30/04 maturing 05/03/04
(collateralized by U.S. Treasury Strips; $12,896,897; $
02/15/06 - 08/15/26) /3/ $12,644,980 12,644,000
TOTAL REPURCHASE AGREEMENTS 12,644,000
------------
TOTAL PORTFOLIO INVESTMENTS (102.63%) 351,727,341
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER ASSETS (-2.63%) (8,999,355)
TOTAL NET ASSETS (100.00%) $342,727,986
---------------
/1 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/2 /Variable rate.
/3 /Security was purchased with the cash proceeds from securities loans.
84
See accompanying notes.
SCHEDULE OF INVESTMENTS
PRINCIPAL GROWTH FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------------
COMMON STOCKS (97.93%)
AEROSPACE & DEFENSE EQUIPMENT (1.23%)
$
United Technologies 44,590 3,846,333
APPAREL MANUFACTURERS (2.09%)
Coach /1/ 153,600 6,543,360
APPLICATIONS SOFTWARE (3.97%)
Microsoft 478,100 12,416,257
BEVERAGES-NON-ALCOHOLIC (1.03%)
Pepsico 59,030 3,216,545
BREWERY (1.04%)
Anheuser-Busch 63,630 3,260,401
CASINO SERVICES (1.53%)
International Game Technology 127,010 4,793,357
COMMERCIAL SERVICE-FINANCE (3.44%)
H&R Block 17,546 791,500
Moody's 74,957 4,835,476
Paychex 137,730 5,134,575
10,761,551
COMPUTERS-INTEGRATED SYSTEMS (2.22%)
Dell /1/ 199,958 6,940,542
COMPUTERS-MEMORY DEVICES (2.00%)
EMC /1/ 240,930 2,688,779
Veritas Software /1/ 133,040 3,548,177
6,236,956
COMPUTERS-PERIPHERAL EQUIPMENT (0.39%)
Lexmark International /1/ 13,580 1,228,447
COSMETICS & TOILETRIES (5.27%)
Alberto-Culver 32,985 1,555,573
Avon Products 59,230 4,975,320
Procter & Gamble 93,980 9,938,385
16,469,278
DATA PROCESSING & MANAGEMENT (1.91%)
Fair, Isaac 50,850 1,714,662
First Data 46,720 2,120,621
SEI Investments 72,480 2,139,609
5,974,892
DIAGNOSTIC KITS (1.05%)
IDEXX Laboratories /1/ 53,760 3,293,338
DISTRIBUTION-WHOLESALE (0.61%)
Fastenal 34,850 1,912,220
DIVERSIFIED FINANCIAL SERVICES (0.74%)
Citigroup 48,003 2,308,464
DIVERSIFIED MANUFACTURING OPERATIONS (8.71%)
3M 85,966 7,434,339
Danaher 44,540 4,120,841
General Electric 388,120 11,624,194
Illinois Tool Works 46,770 4,032,042
27,211,416
ELECTRONIC COMPONENTS-SEMICONDUCTOR (4.36%)
Altera /1/ 98,890 1,978,789
Shares
Held Value
- ------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC COMPONENTS-SEMICONDUCTOR (CONTINUED)
$
Intel 301,062 7,746,325
Texas Instruments 155,923 3,913,667
13,638,781
ENTERPRISE SOFTWARE & SERVICE (0.21%)
BEA Systems /1/ 56,440 643,980
FINANCE-INVESTMENT BANKER & BROKER (2.12%)
Legg Mason 48,920 4,503,575
Morgan Stanley 41,043 2,109,200
6,612,775
FINANCE-MORTGAGE LOAN/BANKER (1.16%)
Federal National Mortgage Association 52,610 3,615,359
FINANCE-OTHER SERVICES (0.86%)
Chicago Mercantile Exchange /2/ 22,900 2,686,170
FOOD-MISCELLANEOUS/DIVERSIFIED (0.50%)
McCormick 45,530 1,555,305
FOOD-RETAIL (0.36%)
Whole Foods Market 14,250 1,139,858
FOOD-WHOLESALE & DISTRIBUTION (1.43%)
Sysco 117,040 4,476,780
INTERNET SECURITY (2.14%)
Symantec /1/ /2/ 148,500 6,689,925
MACHINERY-PUMPS (1.00%)
Graco 111,115 3,133,443
MEDICAL INSTRUMENTS (4.27%)
Medtronic 139,140 7,021,005
St. Jude Medical /1/ 82,801 6,314,404
13,335,409
MEDICAL PRODUCTS (6.47%)
Becton Dickinson 78,260 3,956,043
Johnson & Johnson 210,510 11,373,855
Varian Medical Systems /1/ 57,100 4,901,464
20,231,362
MEDICAL-BIOMEDICAL/GENE (1.52%)
Amgen /1/ 84,480 4,753,690
MEDICAL-DRUGS (6.79%)
Forest Laboratories /1/ 71,600 4,616,768
Pfizer 464,595 16,613,917
21,230,685
MEDICAL-GENERIC DRUGS (0.56%)
Pharmaceutical Resources /1/ 43,510 1,753,453
MEDICAL-HMO (2.19%)
UnitedHealth Group 111,350 6,845,798
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.98%)
Cardinal Health 41,700 3,054,525
MOTORCYCLE & MOTOR SCOOTER (2.12%)
Harley-Davidson 117,450 6,614,784
Shares
Held Value
- ------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MULTI-LINE INSURANCE (0.99%)
$
American International Group 43,190 3,094,563
NETWORKING PRODUCTS (4.60%)
Cisco Systems /1/ 660,170 13,777,748
Foundry Networks /1/ 51,820 585,566
14,363,314
OIL COMPANY-INTEGRATED (1.43%)
Exxon Mobil 105,250 4,478,387
RETAIL-ARTS & CRAFTS (1.37%)
Michaels Stores 85,340 4,269,560
RETAIL-BEDDING (1.63%)
Bed Bath & Beyond /1/ 136,930 5,082,842
RETAIL-CONSUMER ELECTRONICS (1.94%)
Best Buy 111,530 6,050,502
RETAIL-DISCOUNT (2.37%)
Wal-Mart Stores 129,820 7,399,740
RETAIL-JEWELRY (0.44%)
Tiffany 34,960 1,363,440
RETAIL-OFFICE SUPPLIES (1.53%)
Staples 185,880 4,788,269
SCHOOLS (1.66%)
Apollo Group /1/ 57,070 5,186,522
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (2.36%)
Linear Technology 112,399 4,004,776
Maxim Integrated Products 73,141 3,363,755
7,368,531
SEMICONDUCTOR EQUIPMENT (0.15%)
Applied Materials /1/ 25,120 457,938
THERAPEUTICS (1.19%)
Gilead Sciences /1/ 61,100 3,716,713
TOTAL COMMON STOCKS 306,045,760
Principal
Amount Value
- ------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (2.17%)
FINANCE-INVESTMENT BANKER & BROKER (2.17%)
Investment in Joint Trading Account;
Citigroup
$ $
1.02%; 05/03/04 6,772,555 6,772,555
TOTAL COMMERCIAL PAPER 6,772,555
Maturity
Amount Value
- ------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (1.72%)
Goldman Sachs; 0.93%; dated 04/30/04 maturing
05/03/04 (collateralized by U.S. Treasury $
Strips; $5,487,607; 02/15/06 - 08/15/26) /3/ $ 5,380,417 5,380,000
TOTAL REPURCHASE AGREEMENTS 5,380,000
------------
TOTAL PORTFOLIO INVESTMENTS (101.82%) 318,198,315
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER ASSETS (-1.82%) (5,696,314)
TOTAL NET ASSETS (100.00%) $312,502,001
---------------
/1/ Non-income producing security.
/2/ Security or a portion of the security was on loan at the end of the
period. See notes to financial statements.
/3/ Security was purchased with the cas proceeds from securities loans.
SCHEDULE OF INVESTMENTS
PRINCIPAL INTERNATIONAL EMERGING MARKETS FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (94.28%)
AGRICULTURAL OPERATIONS (0.74%)
$
Bunge 7,974 295,437
AIRLINES (1.46%)
EVA Airways 518,000 211,285
Korean Air 12,680 172,907
Thai Airways International /1/ 142,918 203,607
587,799
APPLIANCES (0.46%)
Arcelik 34,170,550 183,078
APPLICATIONS SOFTWARE (0.54%)
Satyam Computer Services 30,001 216,457
AUTO-CARS & LIGHT TRUCKS (1.25%)
Kia Motors 54,040 502,012
BREWERY (0.54%)
Fomento Economico Mexicano 4,975 217,507
BUILDING PRODUCTS-CEMENT & AGGREGATE (2.78%)
Anhui Conch Cement /2/ 325,818 346,713
Cemex 18,839 554,808
Sungshin Cement 11,820 214,570
1,116,091
BUILDING-RESIDENTIAL & COMMERCIAL (2.63%)
Corporacion GEO /3/ 64,372 369,735
Hyundai Development 36,680 412,644
Lalin Property /1/ 496,292 92,411
Land & Houses Public 658,764 182,762
1,057,552
CELLULAR TELECOMMUNICATIONS (5.47%)
Advanced Info Service Public /1/ 173,751 382,157
America Movil 23,969 810,152
China Mobile 58,706 155,048
Maxis Communications 137,636 315,114
Taiwan Cellular 326,000 299,308
Telemig Celular Participacoes 7,600 232,560
2,194,339
CHEMICALS-FIBERS (0.39%)
Formosa Chemicals & Fibre 109,000 157,495
CHEMICALS-PLASTICS (0.47%)
Formosa Plastics 132,540 189,514
COMMERCIAL BANKS (11.25%)
Akbank 93,557,303 435,304
Bank Rakyat /3/ 1,081,042 212,343
CorpBanca /1/ /4/ 11,326 273,693
Credicorp 16,162 207,035
Daegu Bank 33,450 191,860
Hana Bank 6,650 143,672
Hansabank 27,052 207,219
Kookmin Bank 7,115 265,596
Malayan Banking Berhad 75,050 207,375
Standard Bank Investment 133,866 772,261
State Bank of India /1/ 11,118 443,608
Taishin Financial Holdings 711,000 622,820
Turkiye Garanti Bankasi /3/ 93,287,280 286,077
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL BANKS (CONTINUED)
$
Unibanco - Uniao de Bancos Brasileiros 12,683 248,587
4,517,450
DISTRIBUTION-WHOLESALE (0.62%)
Esprit Holdings 60,677 248,938
DIVERSIFIED FINANCIAL SERVICES (0.99%)
Shinhan Financial Group 22,694 395,528
DIVERSIFIED MINERALS (4.58%)
Anglo American 66,188 1,322,571
Antofagasta 11,003 183,024
Cia Vale do Rio Doce 7,289 331,649
1,837,244
DIVERSIFIED OPERATIONS (0.82%)
Alfa 99,550 327,359
ELECTRIC PRODUCTS-MISCELLANEOUS (0.89%)
LG Electronics 3,022 183,378
Moatech 17,181 172,051
355,429
ELECTRIC-GENERATION (0.96%)
Beijing Datang Power Generation /2/ 492,000 384,779
ELECTRONIC COMPONENTS-MISCELLANEOUS (10.42%)
AU Optronics 267,400 547,357
DSP Group /3/ 8,104 200,817
Samsung Electronics 6,050 2,871,990
Samsung SDI 4,420 565,049
4,185,213
ELECTRONIC CONNECTORS (1.42%)
Hon Hai Precision Industry 144,600 570,217
FINANCE-CONSUMER LOANS (1.06%)
African Bank Investments 280,497 427,424
FOOD-MISCELLANEOUS/DIVERSIFIED (0.64%)
Global Bio-Chem Technology Group /2/ 354,371 258,970
FOOD-RETAIL (0.43%)
Dairy Farm International Holdings 88,454 171,601
GAS-DISTRIBUTION (2.93%)
Gail India 62,186 305,337
OAO Gazprom 18,292 643,878
PT Perusahaan Gas Negara /3/ 1,522,028 225,306
1,174,521
GOLD MINING (0.51%)
AngloGold Ashanti 6,454 205,044
IMPORT & EXPORT (0.99%)
Testrite International 704,000 398,411
LIFE & HEALTH INSURANCE (1.52%)
Cathay Financial Holding 242,000 429,801
New Africa Capital 169,761 181,811
611,612
METAL-ALUMINUM (0.71%)
Aluminum Corp. of China 136,309 79,952
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
METAL-ALUMINUM (CONTINUED)
$
National Aluminium 53,500 204,039
283,991
METAL-DIVERSIFIED (1.40%)
MMC Norilsk Nickel 9,471 563,525
MONEY CENTER BANKS (1.07%)
Bank Hapoalim 166,321 429,122
MOTORCYCLE & MOTOR SCOOTER (1.04%)
Hero Honda Motors 38,468 417,638
OIL COMPANY-EXPLORATION & PRODUCTION (0.98%)
PTT Public /1/ 108,103 394,477
OIL COMPANY-INTEGRATED (6.23%)
China Petroleum & Chemical 702,804 243,285
LUKOIL 7,650 831,937
MOL Magyar Olaj-es Gazipari 5,997 226,362
PetroChina 198,906 86,705
Petroleo Brasileiro 38,471 1,111,812
2,500,101
OIL REFINING & MARKETING (0.33%)
Hindustan Petroleum 12,848 133,030
OIL-FIELD SERVICES (0.63%)
Tenaris 8,496 254,795
PAPER & RELATED PRODUCTS (0.57%)
Votorantim Celulose e Papel 7,255 227,807
PETROCHEMICALS (1.48%)
Honam Petrochemical 4,860 181,005
IOI Berhad 98,525 234,645
LG Chemical 4,438 179,282
594,932
POWER CONVERTER & SUPPLY EQUIPMENT (1.10%)
Bharat Heavy Electricals 33,442 440,943
REAL ESTATE OPERATOR & DEVELOPER (2.14%)
Consorcio ARA /3/ 140,285 385,042
IOI Properties 108,049 236,002
IRSA Inversiones y Representaciones /3/ 29,547 239,330
860,374
RETAIL-APPAREL & SHOE (1.26%)
Edgars Consolidated Stores 26,272 504,196
RETAIL-APPLIANCES (0.20%)
Courts Mammoth 119,210 79,682
RETAIL-DISCOUNT (1.15%)
Lojas Americanas 28,763,575 244,007
Siam Makro /1/ 187,802 215,919
459,926
RETAIL-HOME FURNISHINGS (0.87%)
JD Group 58,945 349,115
RETAIL-HYPERMARKETS (0.60%)
Controladora Comercial Mexicana /2/ 217,253 240,043
Shares
Held Value
- ------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-MISCELLANEOUS/DIVERSIFIED (1.01%)
$
Massmart Holdings 91,087 404,613
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (3.37%)
Taiwan Semiconductor Manufacturing /3/ 477,792 827,003
United Microelectronics /3/ 263,000 235,924
Winbond Electronics /3/ 549,000 289,208
1,352,135
SEMICONDUCTOR EQUIPMENT (0.68%)
Advanced Semiconductor Engineering /3/ 329,901 274,090
SHIP BUILDING (0.54%)
Daewoo Shipbuilding & Marine Engineering 21,286 217,695
STEEL PIPE & TUBE (0.09%)
Hylsamex /2/ /3/ 27,930 36,542
STEEL PRODUCERS (2.69%)
Angang New Steel /2/ 406,000 154,857
Cherepovets MK Severstal /1/ /3/ 5,588 184,212
Iscor 64,704 309,742
POSCO 14,079 432,929
1,081,740
TELECOMMUNICATION SERVICES (3.55%)
China Telecom /2/ 448,575 133,713
Indonesian Satellite 1,122,570 508,110
SK Telecom 38,791 783,578
1,425,401
TELEPHONE-INTEGRATED (1.64%)
Philippine Long Distance Telephone /3/ 23,279 448,952
Telefonos de Mexico 6,179 210,951
659,903
TOBACCO (1.18%)
Korea Tobacco & Ginseng 11,110 282,165
Philip Morris 298 193,064
475,229
TRANSPORT-MARINE (1.01%)
Evergreen Marine 265,620 203,892
Malaysia International Shipping 61,442 200,495
404,387
TOTAL COMMON STOCKS 37,852,453
Shares
Held Value
- ------------------------------------------------------------------------------------------
PREFERRED STOCKS (3.60%)
BREWERY (0.72%)
Quilmes Industrial 15,936 290,673
COMMERCIAL BANKS (0.67%)
Banco Itau Holding Financeira 3,385,929 268,622
ELECTRIC-INTEGRATED (0.63%)
Cia Energetica de Minas Gerais 16,582,807 253,216
Shares
Held Value
- ------------------------------------------------------------------------------------------
PREFERRED STOCKS (CONTINUED)
STEEL-SPECIALTY (0.71%)
$
Gerdau 27,052 282,729
TELEPHONE-INTEGRATED (0.87%)
Tele Norte Leste Participacoes 21,006,887 349,283
TOTAL PREFERRED STOCKS 1,444,523
Maturity
Amount Value
- -------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (2.28%)
Credit Suisse First Boston;
1.04%; dated 04/30/04 maturing
05/30/04 (collateralized by
GNMA; $1,020,335; 05/15/18) /5/ $914,330 $ 914,251
TOTAL REPURCHASE AGREEMENTS 914,251
-----------
TOTAL PORTFOLIO INVESTMENTS (100.16%) 40,211,227
LIABILITIES, NET OF
CASH, RECEIVABLES AND
OTHER ASSETS (-0.16%) (65,002)
TOTAL NET ASSETS (100.00%) $40,146,225
--------------
/1 /Market value is determined in accordance with procedures established in good
faith by the Board of Directors.
/2 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/3 /Non-income producing security.
/4 /Restricted Security - The fund held securities, which were purchased in
private placement transactions and may require registration, or an exemption
therefrom, in order to effect their sale in the ordinary course of business.
At the end of the period, restricted securities totaled $273,693 or 0.68% of
net assets.
/5 /Security was purchased with the cash proceeds from securities loans.
INVESTMENTS BY COUNTRY
Country Value Percentage of
Total Value
- ---------------------------------------------------------------
$
Argentina 545,468 1.36%
Brazil 3,845,709 9.56
Chile 273,693 0.68
China 409,942 1.02
Czech Republic 193,065 0.48
Hong Kong 1,854,619 4.61
Hungary 226,362 0.56
India 2,161,051 5.37
Indonesia 945,758 2.35
Israel 429,122 1.07
Korea 8,167,911 20.31
Malaysia 1,273,313 3.17
Mexico 3,152,140 7.84
Peru 207,035 0.52
Philippines 448,952 1.12
Russia 2,223,552 5.53
South Africa 3,154,205 7.84
Spain 207,219 0.52
Taiwan 5,256,327 13.07
Thailand 1,471,332 3.66
Turkey 904,458 2.25
United Kingdom 1,505,595 3.74
United States 1,354,399 3.37
TOTAL $40,211,227 100.00%
------------- ---------
See accompanying notes.
89
SCHEDULE OF INVESTMENTS
PRINCIPAL INTERNATIONAL FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- -----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (96.82%)
ADVERTISING SERVICES (0.81%)
$
WPP Group 195,334 1,929,425
AEROSPACE & DEFENSE-EQUIPMENT (0.57%)
European Aeronautic Defence & Space 53,699 1,358,243
AUDIO & VIDEO PRODUCTS (0.40%)
Matsushita Electric Industrial 64,273 944,103
AUTO-CARS & LIGHT TRUCKS (3.56%)
Hyundai Motor 26,890 1,025,549
Nissan Motor /1/ 152,270 1,695,798
Renault 26,891 2,006,666
Toyota Motor 103,691 3,749,056
8,477,069
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.87%)
Volvo /1 2/ 60,265 2,062,884
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.95%)
NOK /1/ 58,855 2,277,295
BREWERY (0.87%)
Asahi Brewery 184,167 2,069,386
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.49%)
Boral 268,038 1,161,462
BUILDING-HEAVY CONSTRUCTION (1.57%)
Actividades de Construccion y Servicios 27,800 1,350,673
Vinci /1/ 24,530 2,387,714
3,738,387
BUILDING-RESIDENTIAL & COMMERCIAL (1.27%)
Daiwa House Industry 100,746 1,127,464
Persimmon 162,253 1,890,397
3,017,861
CELLULAR TELECOMMUNICATIONS (2.54%)
mm02 /2/ 1,377,521 2,442,829
Vodafone Group 1,484,431 3,612,993
6,055,822
CHEMICALS-DIVERSIFIED (2.18%)
Akzo Nobel /1/ 53,134 1,936,310
Asahi Kasei 360,136 1,967,849
Mitsubishi Gas Chemical 347,716 1,304,467
5,208,626
CHEMICALS-FIBERS (0.45%)
Formosa Chemicals & Fibre 741,000 1,070,680
COMMERCIAL BANKS (3.70%)
Anglo Irish Bank 115,670 1,892,702
Banco Santander Central Hispano /1/ 263,600 2,831,276
Bank of Ireland 138,755 1,684,949
Fortis 82,111 1,787,500
National Bank of Greece 21,383 636,208
8,832,635
COMPUTER SERVICES (0.51%)
CSK 28,057 1,220,367
Shares
Held Value
- -----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DISTRIBUTION-WHOLESALE (1.18%)
$
Wolseley 191,127 2,804,690
DIVERSIFIED MANUFACTURING OPERATIONS (0.89%)
Siemens /1/ 29,520 2,119,688
DIVERSIFIED MINERALS (0.45%)
BHP Billiton 133,866 1,069,449
DIVERSIFIED OPERATIONS (0.19%)
Brascan /1/ 13,061 441,619
ELECTRIC PRODUCTS-MISCELLANEOUS (1.12%)
Hitachi 380,145 2,669,679
ELECTRIC-INTEGRATED (2.97%)
E.ON /1/ 30,729 2,037,053
Enel 261,051 2,081,018
Fortum 156,254 1,751,344
Scottish Power 177,399 1,206,456
7,075,871
ELECTRONIC COMPONENTS-MISCELLANEOUS (2.45%)
Koninklijke Philips Electronics 57,645 1,569,997
OMRON 67,300 1,640,497
Samsung Electronics 5,562 2,640,332
5,850,826
ELECTRONIC MEASUREMENT INSTRUMENTS (0.40%)
Keyence 3,992 958,615
FINANCE-CONSUMER LOANS (0.39%)
Aiful 9,047 918,186
FOOD-MISCELLANEOUS/DIVERSIFIED (2.37%)
Global Bio-Chem Technology Group 712,386 520,603
Nestle /1/ 20,247 5,121,870
5,642,473
FOOD-RETAIL (1.99%)
Carrefour /1/ 48,362 2,244,172
Delhaize Group /2/ 31,049 1,507,410
Tesco 224,604 990,776
4,742,358
HOTELS & MOTELS (0.71%)
InterContinental Hotels Group 180,246 1,686,098
IMPORT & EXPORT (0.55%)
Mitsubishi 137,919 1,314,764
INTERNET CONNECTIVE SERVICES (0.29%)
Hanaro Telecom /2/ 304,143 690,792
INTERNET CONTENT-INFORMATION & NEWS (0.47%)
Freenet.de /1 2/ 12,739 1,122,410
LIFE & HEALTH INSURANCE (1.42%)
Legal & General Group 1,319,571 2,187,959
Power Corporation of Canada 30,487 1,202,632
3,390,591
MACHINERY-ELECTRICAL (0.54%)
Schneider Electric 19,273 1,298,418
Shares
Held Value
- -----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL PRODUCTS (0.43%)
$
Terumo 48,145 1,020,881
MEDICAL-DRUGS (7.24%)
AstraZeneca 39,687 1,855,190
Eisai 36,610 935,528
GlaxoSmithKline 84,720 1,754,784
Merck 26,168 1,399,053
Novartis 145,935 6,505,509
Ono Pharmaceutical 14,737 632,988
Roche Holding /1 / 18,388 1,928,712
Sanofi-Synthelabo /1/ 35,427 2,250,811
17,262,575
MONEY CENTER BANKS (12.16%)
ABN AMRO Holding /1/ 150,017 3,262,170
Barclays 548,283 4,944,138
BNP Paribas 72,893 4,377,764
Credit Suisse Group 36,743 1,295,045
HBOS 135,930 1,764,498
Mitsubishi Tokyo Financial Group 456 4,057,741
Royal Bank of Scotland 139,311 4,182,512
UBS /1/ 71,959 5,114,161
28,998,029
MORTGAGE BANKS (1.17%)
DEPFA Bank 18,658 2,795,562
MULTI-LINE INSURANCE (2.67%)
AXA 115,429 2,431,171
Fondiaria-Sai 75,016 1,655,528
Zurich Financial Services 14,470 2,287,791
6,374,490
MULTIMEDIA (0.66%)
Publishing & Broadcasting 179,343 1,577,572
OIL COMPANY-EXPLORATION & PRODUCTION (1.27%)
Canadian Natural Resources 38,431 2,107,033
PetroKazakhstan /2/ 34,144 924,079
3,031,112
OIL COMPANY-INTEGRATED (7.07%)
ENI 196,946 4,004,071
Petro-Canada 32,563 1,435,353
Petroleo Brasileiro 52,223 1,509,245
Repsol YPF /1/ 210,528 4,434,150
TotalFinaElf 29,667 5,487,422
16,870,241
OIL REFINING & MARKETING (1.00%)
Statoil /1/ 191,598 2,394,958
PETROCHEMICALS (0.26%)
Honam Petrochemical 16,730 623,089
PROPERTY & CASUALTY INSURANCE (2.25%)
Aioi Insurance 248,998 1,094,323
Mitsui Sumitomo Insurance 100,933 950,291
Sompo Japan Insurance 367,000 3,309,003
5,353,617
Shares
Held Value
- -----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PUBLICLY TRADED INVESTMENT FUND (0.95%)
$
iShares MSCI Emerging Markets Index Fund 14,359 2,273,030
PUBLISHING-NEWSPAPERS (0.46%)
John Fairfax Holdings 450,008 1,088,736
PUBLISHING-PERIODICALS (1.01%)
Emap 157,513 2,416,169
REAL ESTATE OPERATOR & DEVELOPER (0.45%)
Amoy Properties /1/ 798,949 1,080,657
RETAIL-APPAREL & SHOE (0.78%)
Next 74,931 1,852,333
RETAIL-JEWELRY (0.58%)
Citizen Watch /1/ 137,604 1,387,823
RETAIL-MAJOR DEPARTMENT STORE (0.78%)
Metro 41,825 1,860,110
RETAIL-PUBS (0.82%)
Punch Taverns 203,361 1,961,830
RUBBER-TIRES (0.86%)
Continental 47,423 2,049,383
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (1.04%)
Taiwan Semiconductor Manufacturing /2/ 643,480 1,113,790
United Microelectronics /2/ 1,529,000 1,371,589
2,485,379
SOAP & CLEANING PREPARATION (1.03%)
Henkel /1/ 28,274 2,447,108
STEEL PRODUCERS (1.14%)
Arcelor 70,004 1,163,094
China Steel 1,179,000 1,050,524
JFE Holdings 22,674 508,524
2,722,142
TELECOMMUNICATION EQUIPMENT (1.67%)
Marconi /2/ 58,517 621,589
TANDBERG /1/ 110,301 996,882
Telefonaktiebolaget LM Ericsson /2/ 876,285 2,374,399
3,992,870
TELECOMMUNICATION SERVICES (2.53%)
Cable & Wireless /2/ 1,070,210 2,339,111
e.Biscom /1 2/ 14,398 856,939
Equant /2/ 64,134 476,660
Telenor /1/ 359,812 2,365,511
6,038,221
TELEPHONE-INTEGRATED (1.83%)
Deutsche Telekom /2/ 102,469 1,758,994
MobilCom /2/ 60,648 1,166,864
Nippon Telegraph & Telephone 273 1,434,824
4,360,682
TELEVISION (0.79%)
Mediaset 170,806 1,873,497
Shares
Held Value
- -----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TOBACCO (1.89%)
$
Imperial Tobacco Group 141,096 3,125,158
Korea Tobacco & Ginseng 54,820 1,392,284
4,517,442
TRANSPORT-MARINE (0.71%)
Mitsui O.S.K. Lines 194,000 849,096
Nippon Yusen Kabushiki Kaisha /1/ 207,800 845,473
1,694,569
TRANSPORT-RAIL (0.69%)
East Japan Railway 324 1,655,892
TRANSPORT-SERVICES (0.49%)
Deutsche Post 53,142 1,172,153
WATER (1.02%)
Suez 121,312 2,431,469
TOTAL COMMON STOCKS 230,884,393
Principal
Amount Value
- -----------------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (1.16%)
FINANCE-INVESTMENT BANKER & BROKER (1.16%)
Merrill Lynch
$ $
1.03%; 05/03/04 2,760,000 2,759,842
TOTAL COMMERCIAL PAPER 2,759,842
Maturity
Amount Value
- -----------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (16.85%)
Credit Suisse First Boston; 1.04%; dated 04/30/04 maturing 05/03/04
(collateralized by GNMA; $44,832,682; 05/15/18) /3/ $40,174,916 $ 40,171,426
TOTAL REPURCHASE AGREEMENTS 40,171,426
------------
TOTAL PORTFOLIO INVESTMENTS (114.83%) 273,815,661
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER ASSETS
(-14.83%) (35,354,891)
TOTAL NET ASSETS (100.00%) $238,460,770
---------------
- ----------------------------------------------------------------
Country Value Percentage of
Total Value
Australia 3,827,770 1.40%
Belgium 3,294,910 1.20
Brazil 1,509,245 0.55
Canada 6,110,716 2.23
Finland 1,751,344 0.64
France 24,915,607 9.10
Germany 17,132,817 6.26
Greece 636,208 0.23
Hong Kong 1,601,261 0.59
Ireland 6,373,213 2.33
Italy 10,471,053 3.82
Japan 42,539,914 15.54
Korea 6,372,046 2.33
Luxembourg 1,163,094 0.42
Netherlands 8,603,379 3.14
Norway 5,757,350 2.10
Spain 8,616,099 3.15
Sweden 4,437,282 1.62
Switzerland 22,253,088 8.13
Taiwan 4,606,583 1.68
United Kingdom 46,638,384 17.03
United States 45,204,298 16.51
------------------- -----------
Total $ 273,815,661 100.00%
92
See accompanying notes.
SCHEDULE OF INVESTMENTS
PRINCIPAL INTERNATIONAL SMALLCAP FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (97.81%)
ADVERTISING AGENCIES (0.51%)
$
Asatsu-DK 10,053 286,044
ADVERTISING SERVICES (0.35%)
IPSOS 1,898 195,328
AGRICULTURAL OPERATIONS (0.49%)
AWB 30,982 107,401
Chaoda Modern Agriculture 534,054 167,752
275,153
AIRLINES (0.94%)
Austrian Airlines /1/ 14,368 210,817
Iberia Lineas Aereas de Espana 94,456 313,645
524,462
AIRPORT DEVELOPMENT & MAINTENANCE (0.71%)
Kobenhavns Lufthavne 2,815 397,686
APPLIANCES (0.80%)
Fisher & Paykel Appliances Holdings 68,088 202,298
Noritz 15,273 243,720
446,018
APPLICATIONS SOFTWARE (0.26%)
Sage Group 46,477 142,381
ATHLETIC FOOTWEAR (1.50%)
Puma /2/ 3,617 837,822
AUDIO & VIDEO PRODUCTS (0.74%)
Grande Holdings 132,665 150,528
Skyworth Digital Holdings /2/ 885,713 261,178
411,706
AUTO-CARS & LIGHT TRUCKS (0.41%)
Isuzu Motors 85,705 230,659
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.59%)
Exedy 23,218 327,583
BEVERAGES-NON-ALCOHOLIC (0.28%)
Cott /1/ 5,092 155,324
BEVERAGES-WINE & SPIRITS (0.52%)
Davide Campari 6,183 287,581
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (2.58%)
Fletcher Building 97,593 277,142
Geberit 1,101 669,125
Kingspan Group 66,818 357,238
Sika 289 135,963
1,439,468
BUILDING & CONSTRUCTION-MISCELLANEOUS (0.85%)
Alfred McAlpine Group 34,842 195,402
Balfour Beatty 62,670 280,896
476,298
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.19%)
Hanil Cement Manufacturing 2,310 106,508
BUILDING PRODUCTS-DOORS & WINDOWS (0.47%)
Masonite International /1/ 10,028 262,504
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
BUILDING-HEAVY CONSTRUCTION (2.08%)
$
Actividades de Construccion y Servicios 2,936 142,647
Daelim Industrial 7,822 290,654
Vinci /2/ 7,456 725,756
1,159,057
BUILDING-RESIDENTIAL & COMMERCIAL (2.20%)
Haseko /1/ 142,168 413,537
McCarthy & Stone 38,796 398,002
Persimmon 35,715 416,113
1,227,652
CELLULAR TELECOMMUNICATIONS (0.25%)
Mobistar 2,182 141,246
CHEMICALS-DIVERSIFIED (1.50%)
British Vita 35,249 166,274
Mitsubishi Gas Chemical 178,845 670,942
837,216
COATINGS & PAINT (0.74%)
Kansai Paint 74,812 410,142
COMMERCIAL BANKS (3.80%)
Anglo Irish Bank 47,049 769,860
Bank of Kyoto /2/ 49,054 317,825
Bank of Piraeus 22,011 259,635
Hiroshima Bank 41,677 186,566
Industrial & Commercial Bank of China /2/ 120,857 144,877
Suruga Bank 35,503 263,486
Wing Lung Bank 24,786 179,544
2,121,793
COMMERCIAL SERVICES (1.33%)
Park24 8,225 278,005
Societe Generale de Surveillance Holding 528 276,909
TIS /2/ 4,970 188,703
743,617
COMPUTER DATA SECURITY (0.59%)
Gemplus International /1/ 141,413 327,171
COMPUTER SERVICES (0.63%)
Indra Sistemas 26,964 349,736
CONSULTING SERVICES (0.32%)
Savills 21,053 177,712
DISTRIBUTION-WHOLESALE (1.97%)
Inchcape 12,206 324,683
Wolseley 52,585 771,658
1,096,341
DIVERSIFIED MINERALS (1.55%)
Inmet Mining /1/ 33,008 427,226
Jubilee Mines 106,938 254,861
Xstrata 16,211 182,548
864,635
ELECTRIC PRODUCTS-MISCELLANEOUS (0.25%)
Techtronic Industries 53,002 142,022
ELECTRIC-TRANSMISSION (0.68%)
Red Electrica de Espana 23,290 378,859
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.53%)
$
Citizen Electronics 4,585 297,066
ELECTRONIC MEASUREMENT INSTRUMENTS (0.66%)
ESPEC 11,790 185,362
Techem /1/ 8,254 182,059
367,421
ENERGY-ALTERNATE SOURCES (0.83%)
Gamesa Corporacion Tecnologica 11,170 462,894
ENGINEERING-RESEARCH & DEVELOPMENT SERVICES (1.31%)
Linde 13,422 732,078
ENTERPRISE SOFTWARE & SERVICE (0.68%)
Open Text /1/ 13,878 377,312
FINANCE-LEASING COMPANY (1.06%)
Ricoh Leasing 8,682 244,674
Sumisho Lease 10,196 349,245
593,919
FINANCE-MORTGAGE LOAN/BANKER (0.52%)
Kensington Group 35,393 291,540
FINANCE-OTHER SERVICES (2.33%)
Aktiv Kapital /2/ 20,823 273,186
Man Group 25,796 772,639
SFE 56,882 255,108
1,300,933
FINANCIAL GUARANTEE INSURANCE (0.72%)
Euler Hermes /1/ 6,830 402,496
FISHERIES (0.31%)
Maruha Group 89,968 174,466
FOOD-FLOUR & GRAIN (0.98%)
Nippon Flour Mills 68,000 309,329
Nisshin Seifun Group 25,625 236,153
545,482
FOOD-MISCELLANEOUS/DIVERSIFIED (1.70%)
CoolBrands International /1/ 27,623 452,935
Global Bio-Chem Technology Group /2/ 332,069 242,672
IAWS Group 21,977 250,277
945,884
FOOD-RETAIL (2.06%)
Colruyt 5,500 591,733
Delhaize Group /1/ /2/ 11,491 557,881
1,149,614
GAS-DISTRIBUTION (0.65%)
Enagas 21,005 238,452
Toho Gas 37,617 124,419
362,871
HOTELS & MOTELS (0.57%)
InterContinental Hotels Group 34,118 319,154
HUMAN RESOURCES (0.45%)
Ranstad Holding /2/ 9,302 248,551
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
INTERNET CONTENT-INFORMATION & NEWS (0.48%)
$
Freenet.de /1/ 3,038 267,673
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.43%)
Schroders 21,384 240,042
LEISURE & RECREATION PRODUCTS (0.59%)
Daiichikosho 11,074 329,144
LIGHTING PRODUCTS & SYSTEMS (0.70%)
USHIO 20,999 391,989
MACHINERY-CONSTRUCTION & MINING (0.32%)
Hitachi Construction Machinery /2/ 13,448 180,355
MACHINERY-ELECTRICAL (0.56%)
Union Tool /2/ 7,851 315,164
MACHINERY-GENERAL INDUSTRY (1.22%)
MAN 13,224 484,287
Max 17,560 196,198
680,485
MEDICAL INSTRUMENTS (1.03%)
Getinge /2/ 49,916 574,990
MEDICAL PRODUCTS (1.06%)
Straumann Holding 3,277 588,879
MEDICAL-DRUGS (1.69%)
Axcan Pharmaceuticals /1/ 16,626 289,058
Fujirebio 16,919 214,947
Galen Holdings 31,283 441,587
945,592
MEDICAL-GENERIC DRUGS (0.39%)
Sawai Pharm 5,664 215,053
MEDICAL-NURSING HOMES (0.47%)
Extendicare /1/ 24,194 262,127
METAL-DIVERSIFIED (1.21%)
Mitsui Mining & Smelting 160,205 675,052
MONEY CENTER BANKS (0.49%)
Mitsui Trust Holdings 38,241 270,638
MORTGAGE BANKS (2.88%)
DEPFA Bank 5,281 791,262
Home Capital Group /1/ 13,013 221,417
Northern Rock 45,276 596,958
1,609,637
MULTI-LINE INSURANCE (0.89%)
Brit Insurance Holdings 190,871 278,401
Pohjola Group /2/ 22,143 220,315
498,716
NON-FERROUS METALS (0.61%)
Cameco 7,871 340,538
NON-HOTEL GAMBLING (1.82%)
Paddy Power 28,727 328,868
William Hill 72,351 688,029
1,016,897
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL & GAS DRILLING (0.30%)
$
Ensign Resource Service Group 10,049 165,650
OIL COMPANY-EXPLORATION & PRODUCTION (0.92%)
Paladin Resources 237,276 514,396
OIL REFINING & MARKETING (0.76%)
Nippon Mining Holdings /2/ 101,185 425,444
OPTICAL SUPPLIES (0.77%)
Essilor International 7,302 427,247
PAPER & RELATED PRODUCTS (0.51%)
Mayr-Melnhof Karton 2,219 281,963
PROPERTY & CASUALTY INSURANCE (1.84%)
Aioi Insurance 94,502 415,327
Amlin 93,896 275,159
Promina Group 123,542 334,583
1,025,069
PROPERTY TRUST (0.29%)
Mirvac Group 52,772 160,070
PROTECTION-SAFETY (0.85%)
Kidde 239,273 475,233
PUBLIC THOROUGHFARES (0.63%)
Autostrada Torino 23,285 353,377
PUBLISHING-BOOKS (0.22%)
Bloomsbury Publishing 25,148 121,525
PUBLISHING-NEWSPAPERS (1.50%)
Gruppo Editoriale L'Espresso /2/ 75,045 442,604
Trinity Mirror 36,139 394,136
836,740
PUBLISHING-PERIODICALS (1.69%)
Emap 41,446 635,761
United Business Media 37,372 305,853
941,614
QUARRYING (0.44%)
Eramet 4,811 246,893
REAL ESTATE MANAGEMENT & SERVICES (2.12%)
Corio 6,867 276,178
Gecina 3,684 274,687
Klepierre 5,840 359,836
Pierre & Vacances 2,963 273,496
1,184,197
REAL ESTATE OPERATOR & DEVELOPER (3.48%)
Inmobiliaria Urbis /2/ 37,113 403,962
Keppel Land 244,661 230,073
Kerry Properties 115,382 167,900
Leopalace21 14,427 241,725
NHP 143,064 474,424
Slough Estates 34,972 273,498
Tokyo Tatemono 24,736 150,180
1,941,762
RETAIL-APPAREL & SHOE (1.62%)
French Connection Group 24,370 191,341
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-APPAREL & SHOE (CONTINUED)
$
Next 28,796 711,852
903,193
RETAIL-BUILDING PRODUCTS (0.86%)
Grafton Group /1/ 63,935 479,780
RETAIL-CONSUMER ELECTRONICS (1.01%)
Carphone Warehouse 68,122 171,844
EDION 35,525 391,128
562,972
RETAIL-MISCELLANEOUS/DIVERSIFIED (1.33%)
Ryohin Keikaku 9,714 413,717
York-Benimaru 10,562 326,369
740,086
RETAIL-PUBS (0.63%)
Punch Taverns 36,638 353,448
RETAIL-SPORTING GOODS (0.35%)
Xebio 7,474 197,424
RUBBER-TIRES (1.29%)
Continental 16,684 720,998
SATELLITE TELECOM (0.87%)
PT Multimedia Servicos de Telecomunicacoes e Multimedia /2/ 21,333 484,863
SEMICONDUCTOR EQUIPMENT (0.94%)
ASM Pacific Technology /2/ 53,983 223,551
SEZ Holding /1/ 9,408 300,394
523,945
SOAP & CLEANING PRODUCTS (0.69%)
McBride 164,737 387,081
STEEL PRODUCERS (2.00%)
BHP Steel 61,074 259,353
INI Steel 26,830 260,674
IPSCO /1/ 15,643 283,229
OneSteel 192,988 313,596
1,116,852
TELECOMMUNICATION EQUIPMENT (2.34%)
GN Store Nord 45,215 351,069
Marconi /1/ 23,730 252,069
TANDBERG /2/ 29,339 265,161
TANDBERG Television /1/ 73,384 438,589
1,306,888
TELECOMMUNICATION SERVICES (0.24%)
e.Biscom /1/ 2,292 136,415
TELEPHONE-INTEGRATED (0.28%)
VersaTel Telecom International /1/ /2/ 72,342 155,229
TRANSPORT-MARINE (0.86%)
Kawasaki Kisen Kaisha 61,758 264,705
Orient Overseas International 87,412 213,491
478,196
TRANSPORT-SERVICES (0.77%)
Toll Holdings 57,181 429,067
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TRANSPORT-TRUCK (1.04%)
$
Seino Transportation /2/ 58,672 580,048
WATER (0.65%)
Kelda Group 43,741 360,304
WIRELESS EQUIPMENT (1.44%)
Hitachi Kokusai Electric /2/ 37,557 297,107
Uniden 12,295 216,699
You Eal Electronics 8,829 291,202
805,008
TOTAL COMMON STOCKS 54,577,353
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------
PREFERRED STOCKS (0.80%)
TELEVISION (0.80%)
ProSiebenSat.1 Media /2/ 22,759 444,157
TOTAL PREFERRED STOCKS 444,157
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (1.86%)
FINANCE-INVESTMENT BANKER & BROKER (1.86%)
Merrill Lynch
$ $
1.03%; 05/03/04 1,035,000 1,034,941
TOTAL COMMERCIAL PAPER 1,034,941
Maturity
Amount Value
- ------------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (12.46%)
Credit Suisse First Boston;1.04%; dated 04/30/04 maturing 05/03/04
(collateralized by GNMA; $7,760,308; 05/15/18) /3/ $ 6,954,072 6,953,468
TOTAL REPURCHASE AGREEMENTS 6,953,468
------------
TOTAL PORTFOLIO INVESTMENTS (112.93%) 63,009,919
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER ASSETS
(-12.93%) (7,212,202)
TOTAL NET ASSETS (100.00%) $55,797,717
---------------
- ------------------------------------------------------------
Country Value Percentage of
Total Value
Australia 2,114,038 3.36%
Austria 492,780 0.78
Belgium 1,290,861 2.05
Bermuda 150,528 0.24
Canada 3,237,321 5.14
Cayman Islands 167,752 0.27
Denmark 748,754 1.19
Finland 220,315 0.35
France 2,905,741 4.61
Germany 3,669,073 5.82
Greece 259,635 0.41
Hong Kong 1,575,236 2.50
Ireland 2,977,285 4.72
Italy 1,219,977 1.94
Japan 12,446,337 19.75
Korea 949,039 1.51
Luxembourg 327,171 0.52
Netherlands 679,957 1.08
New Zealand 479,440 0.76
Norway 976,936 1.55
Portugal 484,863 0.77
Singapore 230,073 0.36
Spain 2,290,195 3.63
Sweden 574,990 0.91
Switzerland 2,153,820 3.42
United Kingdom 12,399,393 19.68
United States 7,988,409 12.68
--------------- ----------
Total $63,009,919 100.00%
96
See accompanying notes.
SCHEDULE OF INVESTMENTS
PRINCIPAL LARGECAP STOCK INDEX FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (95.64%)
ADVERTISING AGENCIES (0.20%)
$
Interpublic Group /1/ 2,375 37,264
Omnicom Group 1,088 86,507
123,771
AEROSPACE & DEFENSE (0.67%)
Boeing 4,823 205,894
Northrop Grumman 1,069 106,098
Raytheon 2,383 76,876
Rockwell Collins 1,022 32,959
421,827
AEROSPACE & DEFENSE EQUIPMENT (0.79%)
General Dynamics 1,135 106,259
Goodrich 673 19,376
Lockheed Martin 2,581 123,114
United Technologies 2,952 254,639
503,388
AGRICULTURAL OPERATIONS (0.08%)
Monsanto 1,520 52,577
AIRLINES (0.11%)
Delta Air Lines /2/ 707 4,398
Southwest Airlines 4,519 64,531
68,929
APPAREL MANUFACTURERS (0.12%)
Jones Apparel Group 723 26,462
Liz Claiborne 625 21,937
VF 619 28,573
76,972
APPLIANCES (0.06%)
Maytag 450 12,555
Whirlpool 399 26,138
38,693
APPLICATIONS SOFTWARE (2.76%)
Citrix Systems /1/ 940 17,907
Compuware /1/ 2,200 16,830
Intuit /1/ 1,136 48,246
Mercury Interactive /1/ 516 21,956
Microsoft 61,800 1,604,946
Parametric Technology /1/ 1,526 6,989
Siebel Systems /1/ 2,839 29,185
1,746,059
ATHLETIC FOOTWEAR (0.19%)
Nike 1,506 108,357
Reebok International 337 12,260
120,617
AUTO-CARS & LIGHT TRUCKS (0.49%)
Ford Motor 10,485 161,050
General Motors /2/ 3,217 152,550
313,600
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.12%)
Navistar International /1/ 394 17,789
Paccar 1,002 56,573
74,362
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (0.09%)
$
Dana 852 17,176
Delphi Automotive Systems 3,208 32,722
Visteon 750 8,145
58,043
BEVERAGES-NON-ALCOHOLIC (2.14%)
Coca-Cola 14,000 707,980
Coca-Cola Enterprises 2,627 70,929
Pepsi Bottling Group 1,487 43,525
Pepsico 9,792 533,566
1,356,000
BEVERAGES-WINE & SPIRITS (0.05%)
Brown-Forman 695 32,568
BREWERY (0.40%)
Adolph Coors 208 13,668
Anheuser-Busch 4,664 238,983
252,651
BROADCASTING SERVICES & PROGRAMMING (0.23%)
Clear Channel Communications 3,524 146,211
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.16%)
Masco 2,590 72,546
Vulcan Materials 583 26,958
99,504
BUILDING PRODUCTS-AIR & HEATING (0.07%)
American Standard /1/ 414 43,549
BUILDING-MAINTENANCE & SERVICE (0.07%)
Ecolab 1,473 43,895
BUILDING-RESIDENTIAL & COMMERCIAL (0.14%)
Centex 709 33,997
KB Home 267 18,404
Pulte 718 35,304
87,705
CABLE TV (0.61%)
Comcast /1/ 12,887 387,899
CASINO HOTELS (0.05%)
Harrah's Entertainment 637 33,876
CASINO SERVICES (0.12%)
International Game Technology 1,985 74,914
CELLULAR TELECOMMUNICATIONS (0.58%)
AT&T Wireless Services /1/ 15,597 215,394
Nextel Communications /1/ 6,295 150,199
365,593
CHEMICALS-DIVERSIFIED (0.90%)
Dow Chemical 5,335 211,746
E. I. Du Pont de Nemours 5,713 245,373
Hercules /1/ 635 7,055
PPG Industries 981 58,183
Rohm & Haas 1,275 49,445
571,802
CHEMICALS-SPECIALTY (0.11%)
Eastman Chemical 443 18,858
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
CHEMICALS-SPECIALTY (CONTINUED)
$
Engelhard 718 20,851
Great Lakes Chemical 289 7,260
Sigma-Aldrich 397 22,486
69,455
CIRCUIT BOARDS (0.05%)
Jabil Circuit /1/ 1,145 30,217
COATINGS & PAINT (0.05%)
Sherwin-Williams 835 31,772
COMMERCIAL BANKS (0.78%)
AmSouth Bancorp 2,010 44,260
BB&T 3,130 107,954
First Horizon National 718 31,563
M&T Bank 683 58,055
Marshall & Ilsley 1,296 47,654
North Fork Bancorp. 868 32,220
Regions Financial 1,272 44,151
SouthTrust 1,891 58,772
Synovus Financial 1,728 41,248
Zions Bancorp 515 29,108
494,985
COMMERCIAL SERVICE-FINANCE (0.34%)
Deluxe 289 11,939
Equifax 796 19,510
H&R Block 1,021 46,057
Moody's 852 54,962
Paychex 2,161 80,562
213,030
COMMERCIAL SERVICES (0.02%)
Convergys /1/ 820 11,906
COMPUTER AIDED DESIGN (0.03%)
Autodesk 646 21,641
COMPUTER SERVICES (0.31%)
Affiliated Computer Services /1/ 778 37,733
Computer Sciences /1/ 1,074 43,937
Electronic Data Systems 2,750 50,298
Sungard Data Systems /1/ 1,645 42,885
Unisys /1/ 1,900 24,757
199,610
COMPUTERS (2.11%)
Apple Computer /1/ 2,116 54,445
Gateway /1/ 2,144 10,334
Hewlett-Packard 17,466 344,080
International Business Machines 9,730 857,894
Sun Microsystems /1/ 18,819 73,394
1,340,147
COMPUTERS-INTEGRATED SYSTEMS (0.84%)
Dell /1/ 14,659 508,814
NCR /1/ 541 24,177
532,991
COMPUTERS-MEMORY DEVICES (0.35%)
EMC /1/ 13,846 154,522
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMPUTERS-MEMORY DEVICES (CONTINUED)
$
Veritas Software /1/ 2,448 65,288
219,810
COMPUTERS-PERIPHERAL EQUIPMENT (0.10%)
Lexmark International /1/ 735 66,488
CONSUMER PRODUCTS-MISCELLANEOUS (0.21%)
American Greetings /1/ 384 7,872
Clorox 1,203 62,291
Fortune Brands 835 63,669
133,832
CONTAINERS-METAL & GLASS (0.03%)
Ball 323 21,318
CONTAINERS-PAPER & PLASTIC (0.10%)
Bemis 608 16,422
Pactiv /1/ 901 20,678
Sealed Air /1/ 486 23,853
60,953
COSMETICS & TOILETRIES (2.43%)
Alberto-Culver 516 24,335
Avon Products 1,348 113,232
Colgate-Palmolive 3,049 176,476
Gillette 5,765 235,904
International Flavors & Fragrances 536 19,430
Kimberly-Clark 2,872 187,972
Procter & Gamble 7,399 782,444
1,539,793
CRUISE LINES (0.24%)
Carnival 3,607 153,911
DATA PROCESSING & MANAGEMENT (0.66%)
Automatic Data Processing 3,377 147,946
First Data 5,082 230,672
Fiserv /1/ 1,115 40,765
419,383
DISPOSABLE MEDICAL PRODUCTS (0.05%)
C.R. Bard 297 31,562
DISTRIBUTION-WHOLESALE (0.10%)
Genuine Parts 996 35,657
W.W. Grainger 522 27,353
63,010
DIVERSIFIED FINANCIAL SERVICES (2.24%)
Citigroup 29,490 1,418,174
DIVERSIFIED MANUFACTURING OPERATIONS (4.78%)
3M 4,487 388,036
Cooper Industries 527 28,938
Crane 340 10,475
Danaher 881 81,510
Eaton 870 51,661
General Electric /3/ 58,386 1,748,661
Honeywell International 4,916 169,995
Illinois Tool Works 1,764 152,074
ITT Industries 528 41,865
Textron 789 43,537
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DIVERSIFIED MANUFACTURING OPERATIONS (CONTINUED)
$
Tyco International 11,450 314,303
3,031,055
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (0.22%)
Cendant 5,769 136,610
E-COMMERCE-SERVICES (0.49%)
eBay /1/ 3,699 295,254
Monster Worldwide /1/ 647 16,570
311,824
ELECTRIC PRODUCTS-MISCELLANEOUS (0.28%)
Emerson Electric 2,414 145,371
Molex 1,090 32,460
177,831
ELECTRIC-GENERATION (0.05%)
AES /1/ 3,565 30,909
ELECTRIC-INTEGRATED (2.28%)
Allegheny Energy /1/ /2/ 727 10,018
Ameren 1,042 45,556
American Electric Power 2,261 68,825
CenterPoint Energy 1,752 18,904
Cinergy 1,020 38,699
CMS Energy /1/ 923 7,670
Consolidated Edison 1,294 53,326
Constellation Energy Group 958 36,864
Dominion Resources 1,858 118,559
DTE Energy 966 37,693
Duke Energy 5,196 109,428
Edison International 1,865 43,641
Entergy 1,310 71,526
Exelon 1,885 126,182
FirstEnergy 1,888 73,821
FPL Group 1,055 67,119
NiSource 1,502 30,280
PG&E /1/ 2,399 66,020
Pinnacle West Capital 522 20,389
PPL 1,015 43,493
Progress Energy 1,403 60,006
Public Service Enterprise Group 1,352 58,001
Southern 4,192 120,562
TECO Energy 1,075 13,685
TXU 1,855 63,330
XCEL Energy 2,283 38,195
1,441,792
ELECTRICAL COMPONENTS & EQUIPMENT (0.01%)
Power-One /1/ 477 4,102
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.08%)
Sanmina /1/ 2,970 29,760
Solectron /1/ 4,788 23,461
53,221
ELECTRONIC COMPONENTS-SEMICONDUCTOR (2.47%)
Advanced Micro Devices /1/ /2/ 1,996 28,383
Altera /1/ 2,169 43,402
Applied Micro Circuits /1/ 1,779 7,845
Broadcom /1/ 1,733 65,438
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC COMPONENTS-SEMICONDUCTOR (CONTINUED)
$
Intel 37,122 955,149
LSI Logic /1/ 2,170 16,145
Micron Technology /1/ 3,489 47,520
National Semiconductor /1/ 1,019 41,565
Nvidia /1/ 928 19,061
PMC - Sierra /1/ 989 12,016
QLogic /1/ 542 14,629
Texas Instruments 9,918 248,942
Xilinx 1,974 66,386
1,566,481
ELECTRONIC CONNECTORS (0.01%)
Thomas & Betts /1/ 334 8,029
ELECTRONIC FORMS (0.09%)
Adobe Systems 1,365 56,429
ELECTRONIC MEASUREMENT INSTRUMENTS (0.14%)
Agilent Technologies /1/ 2,723 73,548
Tektronix 485 14,356
87,904
ENGINEERING-RESEARCH & DEVELOPMENT SERVICES (0.03%)
Fluor 470 17,935
ENGINES-INTERNAL COMBUSTION (0.02%)
Cummins Engine 245 14,653
ENTERPRISE SOFTWARE & SERVICE (0.79%)
BMC Software /1/ 1,289 22,300
Computer Associates International 3,332 89,331
Novell /1/ 2,155 20,774
Oracle /1/ 29,929 335,803
Peoplesoft /1/ 2,084 35,178
503,386
ENTERTAINMENT SOFTWARE (0.14%)
Electronic Arts /1/ 1,711 86,611
FIDUCIARY BANKS (0.55%)
Bank of New York 4,430 129,090
Mellon Financial 2,463 73,003
Northern Trust 1,262 53,358
State Street 1,921 93,745
349,196
FILTRATION & SEPARATION PRODUCTS (0.03%)
Pall 720 17,122
FINANCE-CONSUMER LOANS (0.16%)
SLM 2,581 98,878
FINANCE-CREDIT CARD (1.02%)
American Express 7,364 360,468
Capital One Financial 1,322 86,630
MBNA 7,315 178,340
Providian Financial /1/ 1,662 20,160
645,598
FINANCE-INVESTMENT BANKER & BROKER (1.79%)
Bear Stearns 594 47,603
Charles Schwab 7,767 79,922
Goldman Sachs Group 2,767 267,016
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-INVESTMENT BANKER & BROKER (CONTINUED)
$
Lehman Brothers Holdings 1,587 116,486
Merrill Lynch 5,555 301,248
Morgan Stanley 6,280 322,729
1,135,004
FINANCE-MORTGAGE LOAN/BANKER (1.11%)
Countrywide Credit Industries 1,582 93,813
Federal Home Loan Mortgage 3,941 230,154
Federal National Mortgage Association 5,563 382,289
706,256
FINANCIAL GUARANTEE INSURANCE (0.21%)
Ambac Financial Group 612 42,228
MBIA 825 48,584
MGIC Investment 563 41,448
132,260
FOOD-CONFECTIONERY (0.23%)
Hershey Foods 745 66,223
Wm. Wrigley Jr. 1,287 79,408
145,631
FOOD-FLOUR & GRAIN (0.10%)
Archer Daniels Midland 3,710 65,148
FOOD-MISCELLANEOUS/DIVERSIFIED (0.90%)
Campbell Soup 2,353 65,013
ConAgra Foods 3,074 88,808
General Mills 2,146 104,618
H.J. Heinz 2,016 76,991
Kellogg 2,361 101,287
McCormick 786 26,850
Sara Lee 4,530 104,552
568,119
FOOD-RETAIL (0.30%)
Albertson's 2,101 49,079
Kroger /1/ 4,265 74,638
Safeway /1/ 2,533 58,132
Winn-Dixie Stores /2/ 812 6,188
188,037
FOOD-WHOLESALE & DISTRIBUTION (0.26%)
Supervalu 770 23,708
Sysco 3,691 141,181
164,889
FORESTRY (0.05%)
Plum Creek Timber 1,049 31,008
GAS-DISTRIBUTION (0.14%)
KeySpan 911 32,933
Nicor 252 8,565
Peoples Energy 213 8,903
Sempra Energy 1,301 41,307
91,708
GOLD MINING (0.15%)
Newmont Mining 2,473 92,490
HEALTH CARE COST CONTAINMENT (0.22%)
Caremark Rx /1/ 2,553 86,419
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
HEALTH CARE COST CONTAINMENT (CONTINUED)
$
McKesson 1,666 54,745
141,164
HOME DECORATION PRODUCTS (0.06%)
Newell Rubbermaid 1,571 37,138
HOME FURNISHINGS (0.04%)
Leggett & Platt 1,099 24,837
HOTELS & MOTELS (0.23%)
Hilton Hotels 2,172 37,988
Marriott International 1,317 62,110
Starwood Hotels & Resorts Worldwide 1,169 46,515
146,613
HUMAN RESOURCES (0.04%)
Robert Half International 980 26,725
IDENTIFICATION SYSTEM-DEVELOPMENT (0.03%)
Symbol Technologies 1,324 15,888
INDEPENDENT POWER PRODUCER (0.02%)
Calpine /1/ /2/ 2,366 10,268
INDUSTRIAL AUTOMATION & ROBOTS (0.06%)
Rockwell International 1,071 35,011
INDUSTRIAL GASES (0.21%)
Air Products & Chemicals 1,301 64,803
Praxair 1,861 68,019
132,822
INSTRUMENTS-CONTROLS (0.20%)
Johnson Controls 1,079 59,194
Parker Hannifin 679 37,542
Thermo Electron /1/ 948 27,681
124,417
INSTRUMENTS-SCIENTIFIC (0.13%)
Applied Biosystems Group 1,181 21,931
Millipore /1/ 280 14,680
PerkinElmer 726 13,976
Waters /1/ 695 29,989
80,576
INSURANCE BROKERS (0.29%)
Aon 1,795 46,778
Marsh & McLennan 3,036 136,923
183,701
INTERNET BROKERS (0.04%)
E*trade Group /1/ 2,095 23,799
INTERNET SECURITY (0.13%)
Symantec /1/ 1,782 80,279
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.24%)
Federated Investors 622 18,287
Franklin Resources 1,428 78,297
Janus Capital Group 1,378 20,946
T. Rowe Price Group 721 36,973
154,503
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
LEISURE & RECREATION PRODUCTS (0.03%)
$
Brunswick 536 22,035
LIFE & HEALTH INSURANCE (0.53%)
Aflac 2,936 123,987
Jefferson-Pilot 808 40,069
Lincoln National 1,019 45,733
Principal Financial Group /4/ 1,836 64,811
Torchmark 647 33,670
UnumProvident 1,695 26,357
334,627
LINEN SUPPLY & RELATED ITEMS (0.07%)
Cintas 979 44,016
MACHINERY-CONSTRUCTION & MINING (0.24%)
Caterpillar 1,988 154,527
MACHINERY-FARM (0.15%)
Deere 1,394 94,848
MACHINERY-GENERAL INDUSTRY (0.18%)
Dover 1,163 46,555
Ingersoll-Rand 1,004 64,808
111,363
MEDICAL INFORMATION SYSTEM (0.05%)
IMS Health 1,371 34,618
MEDICAL INSTRUMENTS (1.24%)
Biomet 1,465 57,867
Boston Scientific /1/ 4,690 193,181
Guidant 1,783 112,347
Medtronic 6,940 350,192
St. Jude Medical /1/ 987 75,269
788,856
MEDICAL LABORATORY & TESTING SERVICE (0.08%)
Quest Diagnostics 593 50,020
MEDICAL PRODUCTS (2.09%)
Baxter International 3,494 110,585
Becton Dickinson 1,447 73,146
Johnson & Johnson 16,992 918,078
Stryker 1,142 112,978
Zimmer Holdings /1/ 1,385 110,592
1,325,379
MEDICAL-BIOMEDICAL/GENE (1.00%)
Amgen /1/ 7,385 415,554
Biogen Idec /1/ 1,876 110,684
Chiron /1/ 1,073 49,787
Genzyme /1/ 1,284 55,931
631,956
MEDICAL-DRUGS (6.31%)
Abbott Laboratories 8,952 394,067
Allergan 752 66,214
Bristol-Myers Squibb 11,113 278,936
Eli Lilly 6,434 474,893
Forest Laboratories /1/ 2,106 135,795
King Pharmaceuticals /1/ 1,381 23,822
Medimmune /1/ 1,417 34,348
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-DRUGS (CONTINUED)
$
Merck 12,735 598,545
Pfizer 43,656 1,561,139
Schering-Plough 8,423 140,917
Wyeth 7,625 290,284
3,998,960
MEDICAL-GENERIC DRUGS (0.09%)
Mylan Laboratories 1,536 35,190
Watson Pharmaceutical /1/ 618 22,007
57,197
MEDICAL-HMO (0.75%)
Aetna 878 72,655
Anthem /1/ 792 70,155
Humana /1/ 928 15,117
UnitedHealth Group 3,583 220,283
Wellpoint Health Networks /1/ 888 99,181
477,391
MEDICAL-HOSPITALS (0.28%)
HCA 2,837 115,267
Health Management Associates 1,391 32,174
Tenet Healthcare /1/ 2,661 31,293
178,734
MEDICAL-NURSING HOMES (0.03%)
Manor Care 512 16,609
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.35%)
AmerisourceBergen 643 37,223
Cardinal Health 2,491 182,466
219,689
METAL PROCESSORS & FABRICATION (0.01%)
Worthington Industries 495 8,935
METAL-ALUMINUM (0.24%)
Alcoa 4,982 153,196
METAL-COPPER (0.06%)
Phelps Dodge /1/ 531 34,956
METAL-DIVERSIFIED (0.05%)
Freeport-McMoran Copper & Gold 986 30,073
MISCELLANEOUS INVESTING (0.32%)
Apartment Investment & Management 536 15,099
Equity Office Properties Trust 2,289 57,614
Equity Residential Properties Trust 1,595 43,799
Prologis Trust 1,037 30,509
Simon Property Group 1,169 56,357
203,378
MONEY CENTER BANKS (2.18%)
Bank of America 11,697 941,492
JP Morgan Chase 11,784 443,078
1,384,570
MOTORCYCLE & MOTOR SCOOTER (0.15%)
Harley-Davidson 1,734 97,659
MULTI-LINE INSURANCE (2.89%)
Allstate 4,028 184,885
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MULTI-LINE INSURANCE (CONTINUED)
$
American International Group 14,936 1,070,164
Cigna 807 52,060
Cincinnati Financial 965 39,553
Hartford Financial Services 1,668 101,882
Loews 1,062 61,607
MetLife 4,352 150,144
Prudential Financial 3,094 135,950
Safeco 794 34,769
1,831,014
MULTIMEDIA (2.10%)
Gannett 1,552 134,527
McGraw-Hill 1,095 86,352
Meredith 287 14,620
Time Warner /1/ 26,066 438,430
Viacom 10,015 387,080
Walt Disney 11,723 269,980
1,330,989
NETWORKING PRODUCTS (1.48%)
Cisco Systems /1/ 39,348 821,193
Lucent Technologies /1/ /2/ 24,389 82,191
Network Appliance /1/ 1,976 36,793
940,177
NON-HAZARDOUS WASTE DISPOSAL (0.18%)
Allied Waste Industries /1/ 1,834 23,090
Waste Management 3,302 93,777
116,867
OFFICE AUTOMATION & EQUIPMENT (0.19%)
Pitney Bowes 1,337 58,494
Xerox /1/ 4,567 61,335
119,829
OFFICE SUPPLIES & FORMS (0.06%)
Avery Dennison 632 40,593
OIL & GAS DRILLING (0.21%)
Nabors Industries /1/ 839 37,218
Noble /1/ 769 28,576
Rowan /1/ 596 13,291
Transocean Sedco Forex /1/ 1,832 50,875
129,960
OIL COMPANY-EXPLORATION & PRODUCTION (0.59%)
Anadarko Petroleum 1,441 77,209
Apache 1,856 77,711
Burlington Resources 1,133 76,217
Devon Energy 1,331 81,457
EOG Resources 659 32,456
Kerr-McGee 578 28,281
373,331
OIL COMPANY-INTEGRATED (4.26%)
Amerada Hess 515 36,632
ChevronTexaco 6,125 560,438
ConocoPhillips 3,917 279,282
Exxon Mobil 37,544 1,597,497
Marathon Oil 1,948 65,375
Occidental Petroleum 2,222 104,878
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL COMPANY-INTEGRATED (CONTINUED)
$
Unocal 1,482 53,411
2,697,513
OIL REFINING & MARKETING (0.15%)
Ashland 398 19,064
Sunoco 442 27,802
Valero Energy 728 46,417
93,283
OIL-FIELD SERVICES (0.60%)
Baker Hughes 1,917 70,316
BJ Services /1/ 911 40,540
Halliburton 2,508 74,738
Schlumberger 3,370 197,246
382,840
OPTICAL SUPPLIES (0.03%)
Bausch & Lomb 300 18,849
PAPER & RELATED PRODUCTS (0.50%)
Boise Cascade 499 16,831
Georgia-Pacific 1,453 51,000
International Paper 2,750 110,880
Louisiana-Pacific 606 14,296
MeadWestvaco 1,152 30,125
Temple-Inland 313 19,334
Weyerhaeuser 1,259 74,533
316,999
PHARMACY SERVICES (0.14%)
Express Scripts /1/ 444 34,339
Medco Health Solutions /1/ 1,548 54,799
89,138
PHOTO EQUIPMENT & SUPPLIES (0.07%)
Eastman Kodak 1,641 42,321
PIPELINES (0.17%)
Dynegy /1/ /2/ 2,157 8,542
El Paso 3,670 25,726
Kinder Morgan 706 42,508
Williams 2,966 30,550
107,326
POWER CONVERTER & SUPPLY EQUIPMENT (0.03%)
American Power Conversion 1,136 21,198
PRINTING-COMMERCIAL (0.06%)
R.R. Donnelley & Sons 1,226 36,069
PROPERTY & CASUALTY INSURANCE (0.74%)
ACE 1,598 70,056
Chubb 1,075 74,175
Progressive 1,242 108,700
St. Paul 3,799 154,506
XL Capital 786 60,011
467,448
PUBLICLY TRADED INVESTMENT FUND (2.60%)
iShares S&P 500 Index Fund /2/ 14,820 1,645,020
PUBLISHING-NEWSPAPERS (0.29%)
Dow Jones 467 21,524
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PUBLISHING-NEWSPAPERS (CONTINUED)
$
Knight Ridder 457 35,390
New York Times 859 39,351
Tribune 1,890 90,493
186,758
REGIONAL BANKS (3.41%)
Bank One 6,410 316,462
Comerica 1,004 51,836
Fifth Third Bancorp 3,235 173,590
Huntington Bancshares 1,313 28,098
KeyCorp 2,400 71,280
National City 3,470 120,305
PNC Financial Services Group 1,587 84,270
SunTrust Banks 1,616 109,969
U.S. Bancorp 10,992 281,835
Union Planters 1,079 29,996
Wachovia 7,528 344,406
Wells Fargo 9,688 546,984
2,159,031
RETAIL-APPAREL & SHOE (0.31%)
Gap 5,128 112,867
Limited 2,669 55,088
Nordstrom 787 28,041
195,996
RETAIL-AUTO PARTS (0.07%)
Autozone /1/ 499 43,697
RETAIL-AUTOMOBILE (0.04%)
AutoNation /1/ 1,575 26,807
RETAIL-BEDDING (0.10%)
Bed Bath & Beyond /1/ 1,709 63,438
RETAIL-BUILDING PRODUCTS (1.09%)
Home Depot 13,026 458,385
Lowe's 4,502 234,374
692,759
RETAIL-CONSUMER ELECTRONICS (0.23%)
Best Buy 1,858 100,797
Circuit City Stores 1,205 14,074
RadioShack 940 28,914
143,785
RETAIL-DISCOUNT (2.97%)
Big Lots /1/ 669 9,473
Costco Wholesale /1/ 2,622 98,194
Dollar General 1,929 36,188
Family Dollar Stores 986 31,690
Target 5,218 226,305
TJX 2,881 70,786
Wal-Mart Stores 24,778 1,412,346
1,884,982
RETAIL-DRUG STORE (0.46%)
CVS 2,269 87,651
Walgreen 5,868 202,329
289,980
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-JEWELRY (0.05%)
$
Tiffany 839 32,721
RETAIL-MAJOR DEPARTMENT STORE (0.24%)
J.C. Penney 1,563 52,923
May Department Stores 1,652 50,882
Sears Roebuck 1,276 51,104
154,909
RETAIL-OFFICE SUPPLIES (0.17%)
Office Depot /1/ 1,778 31,133
Staples 2,858 73,622
104,755
RETAIL-REGIONAL DEPARTMENT STORE (0.22%)
Dillards 477 8,028
Federated Department Stores 1,035 50,715
Kohl's /1/ 1,946 81,323
140,066
RETAIL-RESTAURANTS (0.63%)
Darden Restaurants 944 21,391
McDonald's 7,224 196,710
Starbucks /1/ 2,268 88,134
Wendy's International 652 25,428
Yum! Brands /1/ 1,684 65,322
396,985
RETAIL-TOY STORE (0.03%)
Toys R Us /1/ 1,222 18,880
RUBBER-TIRES (0.03%)
Cooper Tire & Rubber 423 9,048
Goodyear Tire & Rubber /1/ /2/ 1,004 8,745
17,793
SAVINGS & LOANS-THRIFTS (0.53%)
Charter One Financial 1,275 42,547
Golden West Financial 870 91,445
Washington Mutual 5,148 202,780
336,772
SCHOOLS (0.14%)
Apollo Group /1/ 1,008 91,607
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (0.38%)
Analog Devices 2,140 91,164
Linear Technology 1,788 63,707
Maxim Integrated Products 1,878 86,369
241,240
SEMICONDUCTOR EQUIPMENT (0.43%)
Applied Materials /1/ 9,627 175,500
Kla-Tencor /1/ 1,124 46,837
Novellus Systems /1/ 878 25,427
Teradyne /1/ 1,095 22,316
270,080
STEEL PRODUCERS (0.07%)
Nucor 448 26,611
United States Steel 648 18,552
45,163
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
STEEL-SPECIALTY (0.01%)
$
Allegheny Technologies 461 4,711
TELECOMMUNICATION EQUIPMENT (0.60%)
ADC Telecommunications /1/ 4,617 11,542
Andrew /1/ 909 15,408
Comverse Technology /1/ 1,104 18,061
Qualcomm 4,610 287,941
Scientific-Atlanta 873 28,276
Tellabs /1/ 2,378 20,760
381,988
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.19%)
CIENA /1/ 2,719 11,257
Corning /1/ 7,717 85,118
JDS Uniphase /1/ 8,222 24,995
121,370
TELECOMMUNICATION SERVICES (0.05%)
Avaya /1/ 2,431 33,256
TELEPHONE-INTEGRATED (2.74%)
ALLTEL 1,787 89,958
AT&T 4,543 77,912
BellSouth 10,486 270,644
CenturyTel 826 23,855
Citizens Communications /1/ 1,628 21,229
Qwest Communications International /1/ 10,112 40,650
SBC Communications 18,937 471,531
Sprint 8,138 145,589
Verizon Communications 15,810 596,669
1,738,037
TELEVISION (0.10%)
Univision Communications /1/ 1,846 62,487
TOBACCO (1.13%)
Altria Group 11,718 648,943
RJ Reynolds Tobacco Holdings 484 31,349
UST 949 35,312
715,604
TOOLS-HAND HELD (0.09%)
Black & Decker 449 25,975
Snap-On 333 11,249
Stanley Works 464 19,724
56,948
TOYS (0.10%)
Hasbro 999 18,871
Mattel 2,461 41,739
60,610
TRANSPORT-RAIL (0.39%)
Burlington Northern Santa Fe 2,130 69,651
CSX 1,225 37,681
Norfolk Southern 2,239 53,333
Union Pacific 1,482 87,334
247,999
TRANSPORT-SERVICES (0.91%)
FedEx 1,709 122,894
Shares
Held Value
- --------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TRANSPORT-SERVICES (CONTINUED)
$
United Parcel Service 6,464 453,450
576,344
TRAVEL SERVICES (0.03%)
Sabre Holdings 802 18,919
TRUCKING & LEASING (0.02%)
Ryder System 372 13,686
WEB PORTALS (0.30%)
Yahoo /1/ /2/ 3,809 192,202
WIRELESS EQUIPMENT (0.39%)
Motorola 13,401 244,568
TOTAL COMMON STOCKS 60,608,139
Principal
Amount Value
- --------------------------------------------------------------------------------------------
COMMERCIAL PAPER (4.38%)
FINANCE-MORTGAGE LOAN/BANKER (4.38%)
Investment in Joint Trading Account: Federal
Home Loan Bank
$ $
0.90%; 05/03/04 2,776,249 2,776,110
TOTAL COMMERCIAL PAPER 2,776,110
SCHEDULE OF INVESTMENTS
PRINCIPAL LARGECAP STOCK INDEX FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Maturity
Amount Value
- -------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (1.53%)
Goldman Sachs; 0.93%; dated
04/30/04 maturing 05/03/04
(collateralized by U.S.
Treasury Strips; $990,421;
02/15/06 - 08/15/26) /5/ $971,075 $ 971,000
TOTAL REPURCHASE AGREEMENTS 971,000
-----------
TOTAL PORTFOLIO INVESTMENTS (101.55%) 64,355,249
LIABILITIES, NET OF
CASH, RECEIVABLES AND
OTHER ASSETS (-1.55%) (984,187)
TOTAL NET ASSETS (100.00%) $63,371,062
--------------
Contract Opening Current Unrealized
Type Commitment Market Value Market Value Gain (Loss)
- -----------------------------------------------------------------
FUTURES CONTRACTS
10 S&P 500 Buy $2,795,325 $2,765,250 $(30,075)
June, 2004
Futures
/1 /Non-income producing security.
/2 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/3 /Security or a portion of the security was pledged to cover margin
requirements for futures contracts.
/4 /Affiliated security.
/5 /Security was purchased with the cash proceeds from securities loans.
See accompanying notes.
SCHEDULE OF INVESTMENTS
PRINCIPAL LIMITED TERM BOND FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (91.28%)
AEROSPACE & DEFENSE (0.11%)
Raytheon
$ $
6.75%; 08/15/07 125,000 136,983
AEROSPACE & DEFENSE EQUIPMENT (0.27%)
General Dynamics
3.00%; 05/15/08 115,000 111,300
Lockheed Martin
7.45%; 06/15/04 115,000 115,683
United Technologies
4.88%; 11/01/06 100,000 104,733
331,716
AGRICULTURAL OPERATIONS (0.09%)
Bunge Limited Finance /1/
4.38%; 12/15/08 110,000 109,619
AIRLINES (0.11%)
Southwest Airlines
5.50%; 11/01/06 125,000 131,908
ASSET BACKED SECURITIES (0.33%)
Bear Stearns Asset Backed Securities /2/
1.70%; 03/25/34 400,000 400,000
AUTO-CARS & LIGHT TRUCKS (0.61%)
DaimlerChrysler Holding
6.90%; 09/01/04 590,000 599,160
7.25%; 01/18/06 125,000 133,934
733,094
AUTOMOBILE SEQUENTIAL (8.83%)
Capital Auto Receivables Asset Trust
2.64%; 03/17/08 250,000 250,953
3.05%; 09/15/05 100,000 100,632
3.58%; 10/16/06 1,125,000 1,146,141
3.82%; 07/15/05 191,410 192,536
4.16%; 07/16/07 800,000 815,893
Chase Manhattan Auto Owner Trust
2.06%; 12/15/09 475,000 463,465
4.21%; 01/15/09 1,050,000 1,077,687
DaimlerChrysler Auto Trust
2.88%; 10/08/09 200,000 200,241
3.09%; 01/08/08 100,000 100,922
6.70%; 03/08/06 905,918 918,563
6.85%; 11/06/05 299,750 302,338
Ford Credit Auto Owner Trust
2.70%; 06/15/07 250,000 251,146
4.01%; 03/15/06 677,786 685,444
4.72%; 12/15/05 1,285,000 1,302,210
5.25%; 09/15/05 1,069,484 1,077,490
Honda Auto Receivables Owner Trust
2.70%; 03/17/08 200,000 200,467
M&I Auto Loan Trust
3.04%; 10/20/08 500,000 504,969
Nissan Auto Receivables Owner Trust
1.89%; 12/15/06 150,000 150,267
3.33%; 01/15/08 200,000 202,862
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
AUTOMOBILE SEQUENTIAL (CONTINUED)
Toyota Auto Receivables Owner Trust
$ $
4.72%; 09/15/08 700,000 710,230
10,654,456
BEVERAGES-NON-ALCOHOLIC (0.13%)
Coca-Cola Enterprises
5.25%; 05/15/07 150,000 159,078
BEVERAGES-WINE & SPIRITS (0.27%)
Diageo
7.13%; 09/15/04 115,000 117,386
Diageo Capital
3.38%; 03/20/08 100,000 98,613
Diageo Finance
3.00%; 12/15/06 115,000 114,839
330,838
BROADCASTING SERVICES & PROGRAMMING (0.11%)
Liberty Media
3.50%; 09/25/06 135,000 135,261
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.10%)
Masco
6.00%; 05/03/04 120,000 120,000
CABLE TV (0.42%)
Comcast Cable Communications
6.38%; 01/30/06 170,000 180,100
8.13%; 05/01/04 195,000 195,000
Cox Communications
6.88%; 06/15/05 120,000 125,968
501,068
CELLULAR TELECOMMUNICATIONS (0.89%)
360 Communications
7.50%; 03/01/06 140,000 151,808
AT&T Wireless Services
6.88%; 04/18/05 25,000 26,160
7.35%; 03/01/06 180,000 194,772
Cingular Wireless
5.63%; 12/15/06 125,000 132,345
Telus
7.50%; 06/01/07 110,000 121,555
Verizon Wireless Capital
5.38%; 12/15/06 325,000 342,945
Vodafone Group
7.63%; 02/15/05 105,000 109,671
1,079,256
CHEMICALS-DIVERSIFIED (0.18%)
Chevron Phillips Chemical
5.38%; 06/15/07 110,000 115,762
E. I. Du Pont de Nemours
3.38%; 11/15/07 100,000 100,138
215,900
COATINGS & PAINT (0.11%)
Valspar
6.00%; 05/01/07 125,000 133,574
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
COMMERCIAL BANKS (0.29%)
AmSouth Bank
$ $
2.82%; 11/03/06 115,000 114,535
Marshall & Ilsley Bank
4.13%; 09/04/07 100,000 103,089
Union Planters Bank
5.13%; 06/15/07 120,000 127,762
345,386
COMMERCIAL SERVICE-FINANCE (0.06%)
Equifax
4.95%; 11/01/07 65,000 67,928
COMPUTER SERVICES (0.16%)
Electronic Data Systems /3/
6.85%; 10/15/04 80,000 81,498
Sungard Data Systems /1/
3.75%; 01/15/09 115,000 112,236
193,734
COMPUTERS (0.23%)
Hewlett-Packard
5.50%; 07/01/07 185,000 196,805
International Business Machines
4.25%; 09/15/09 85,000 85,740
282,545
COSMETICS & TOILETRIES (0.18%)
Gillette
2.50%; 06/01/08 55,000 52,485
4.00%; 06/30/05 80,000 81,794
Procter & Gamble
4.75%; 06/15/07 75,000 78,382
212,661
CREDIT CARD ASSET BACKED SECURITIES (7.04%)
American Express Master Trust
7.85%; 08/15/05 830,000 850,300
Bank One Issuance Trust
2.94%; 06/16/08 1,350,000 1,363,875
3.35%; 03/15/11 600,000 590,267
Capital One Master Trust
5.30%; 06/15/09 700,000 737,506
5.45%; 03/16/09 750,000 784,646
Capital One Multi-Asset Execution Trust /2/
1.32%; 12/15/09 255,000 255,213
Chase Credit Card Master Trust
1.30%; 05/15/09 /2/ 300,000 300,000
5.50%; 11/17/08 100,000 106,037
Citibank Credit Card Issuance Trust
2.70%; 01/15/08 300,000 301,288
6.90%; 10/15/07 750,000 799,934
Discover Card Master Trust I
6.05%; 08/18/08 855,000 907,870
MBNA Master Credit Card Trust
6.35%; 12/15/06 750,000 757,982
6.90%; 01/15/08 700,000 742,975
8,497,893
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
DATA PROCESSING & MANAGEMENT (0.09%)
First Data
$ $
3.38%; 08/01/08 105,000 103,177
DIVERSIFIED FINANCIAL SERVICES (2.40%)
Citigroup
6.75%; 12/01/05 1,315,000 1,405,882
General Electric Capital
1.28%; 02/02/09 /2/ 120,000 120,205
4.25%; 01/15/08 950,000 969,191
5.00%; 06/15/07 130,000 136,315
John Deere Capital
4.50%; 08/22/07 95,000 98,038
NiSource Finance
3.20%; 11/01/06 85,000 85,014
Textron Financial
5.88%; 06/01/07 75,000 80,863
2,895,508
DIVERSIFIED MANUFACTURING OPERATIONS (0.07%)
Cooper Industries
5.25%; 07/01/07 80,000 84,315
ELECTRIC-DISTRIBUTION (0.06%)
Detroit Edison
5.05%; 10/01/05 75,000 77,602
ELECTRIC-INTEGRATED (2.24%)
Alabama Power
2.80%; 12/01/06 60,000 59,552
Appalachian Power
4.80%; 06/15/05 140,000 143,760
Commonwealth Edison
6.40%; 10/15/05 230,000 242,462
Conectiv
5.30%; 06/01/05 45,000 46,352
Consolidated Edison
3.63%; 08/01/08 110,000 108,764
Dominion Resources
1.39%; 05/15/06 /2/ 120,000 120,178
7.63%; 07/15/05 105,000 111,667
7.82%; 09/15/04 200,000 204,485
Duke Energy
3.75%; 03/05/08 85,000 84,565
FPL Group Capital
3.25%; 04/11/06 125,000 126,356
Georgia Power /2/
1.30%; 02/17/09 130,000 129,865
MidAmerican Energy Holdings
4.63%; 10/01/07 115,000 117,543
Niagara Mohawk Power
7.75%; 05/15/06 110,000 120,400
Oncor Electric Delivery
5.00%; 09/01/07 95,000 99,498
Pacific Gas & Electric
3.60%; 03/01/09 120,000 116,402
Pepco Holdings
5.50%; 08/15/07 105,000 110,300
Progress Energy
6.75%; 03/01/06 210,000 224,354
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
ELECTRIC-INTEGRATED (CONTINUED)
Public Service Company of Colorado
$ $
4.38%; 10/01/08 105,000 106,298
SCANA /2/
1.57%; 11/15/06 125,000 125,061
Tennessee Valley Authority
6.38%; 06/15/05 175,000 183,546
TXU U.S. Holdings
6.25%; 10/01/04 125,000 127,375
2,708,783
FEDERAL & FEDERALLY SPONSORED CREDIT (2.01%)
Federal Farm Credit Bank
3.00%; 04/15/08 200,000 195,662
7.25%; 06/12/07 2,000,000 2,235,958
2,431,620
FIDUCIARY BANKS (0.15%)
Bank of New York
4.14%; 08/02/07 100,000 101,889
5.20%; 07/01/07 70,000 74,332
176,221
FINANCE-AUTO LOANS (2.48%)
American Honda Finance /1/ /2/
1.25%; 02/20/07 120,000 119,949
Ford Motor Credit
6.13%; 01/09/06 340,000 354,396
6.50%; 01/25/07 550,000 583,245
6.70%; 07/16/04 500,000 505,195
General Motors Acceptance
2.40%; 10/20/05 /2/ 220,000 221,498
4.38%; 12/10/07 95,000 94,957
5.13%; 05/09/08 /3/ 135,000 137,220
6.13%; 08/28/07 160,000 169,073
6.75%; 01/15/06 670,000 709,466
Toyota Motor Credit
2.80%; 01/18/06 100,000 101,381
2,996,380
FINANCE-COMMERCIAL (0.54%)
CIT Group
1.32%; 02/15/07 /2/ 130,000 130,106
7.38%; 04/02/07 470,000 521,579
651,685
FINANCE-CONSUMER LOANS (1.48%)
American General Finance
5.88%; 07/14/06 495,000 527,496
Household Finance
1.28%; 02/09/07 /2/ 120,000 120,220
3.38%; 02/21/06 210,000 212,936
6.50%; 01/24/06 545,000 581,653
SLM /2/
3.13%; 03/02/09 350,000 344,260
1,786,565
FINANCE-CREDIT CARD (0.24%)
American Express
3.75%; 11/20/07 100,000 101,480
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FINANCE-CREDIT CARD (CONTINUED)
Capital One Bank
$ $
6.88%; 02/01/06 175,000 186,573
288,053
FINANCE-INVESTMENT BANKER & BROKER (2.70%)
Banque Paribas
8.35%; 06/15/07 140,000 158,996
Bear Stearns
3.00%; 03/30/06 130,000 130,784
6.50%; 05/01/06 325,000 348,424
Credit Suisse First Boston
5.75%; 04/15/07 365,000 389,198
Goldman Sachs Group
7.63%; 08/17/05 250,000 266,588
Lehman Brothers Holdings
6.25%; 05/15/06 505,000 539,845
Merrill Lynch
1.38%; 02/06/09 /2/ 120,000 120,037
3.09%; 03/02/09 /2/ 130,000 128,151
6.00%; 11/15/04 400,000 409,547
Morgan Stanley
1.25%; 02/15/07 /2/ 130,000 130,031
7.75%; 06/15/05 595,000 632,406
3,254,007
FINANCE-LEASING COMPANY (0.24%)
Boeing Capital
7.10%; 09/27/05 275,000 292,837
FINANCE-MORTGAGE LOAN/BANKER (24.53%)
Countrywide Home Loan
1.27%; 02/17/06 /2/ 130,000 129,988
2.88%; 02/15/07 120,000 118,328
4.50%; 01/25/33 207,513 209,303
6.85%; 06/15/04 345,000 347,123
Federal Home Loan Bank
2.88%; 09/15/06 100,000 100,320
4.88%; 11/15/06 5,600,000 5,875,027
Federal Home Loan Mortgage
1.50%; 08/15/05 1,600,000 1,591,917
5.25%; 01/15/06 5,575,000 5,845,800
5.75%; 04/15/08 5,150,000 5,558,236
Federal National Mortgage Association
3.07%; 02/17/09 /2/ 400,000 396,104
5.25%; 04/15/07 4,750,000 5,036,397
7.00%; 07/15/05 4,150,000 4,402,714
29,611,257
FINANCE-OTHER SERVICES (0.72%)
Caterpillar Financial Services
3.00%; 02/15/07 120,000 119,396
4.69%; 04/25/05 80,000 82,339
Mellon Funding
4.88%; 06/15/07 70,000 73,225
National Rural Utilities
6.00%; 05/15/06 205,000 218,469
Verizon Global Funding
6.75%; 12/01/05 355,000 378,793
872,222
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
FOOD-MISCELLANEOUS/DIVERSIFIED (0.83%)
Campbell Soup
$ $
5.50%; 03/15/07 265,000 281,593
General Mills
5.13%; 02/15/07 85,000 89,183
Kellogg
6.00%; 04/01/06 165,000 175,158
Kraft Foods
4.63%; 11/01/06 220,000 227,536
Sara Lee
2.75%; 06/15/08 60,000 57,494
Unilever Capital
6.88%; 11/01/05 155,000 165,500
996,464
FOOD-RETAIL (0.34%)
Fred Meyer
7.38%; 03/01/05 190,000 198,357
Safeway
2.50%; 11/01/05 105,000 104,994
7.25%; 09/15/04 110,000 112,128
415,479
HOME EQUITY-OTHER (0.16%)
Argent Securities /2/
1.32%; 02/25/34 130,000 129,968
Specialty Underwriting & Residential Finance /2/
1.61%; 02/25/35 60,000 60,000
189,968
HOME EQUITY-SEQUENTIAL (0.52%)
Ameriquest Mortgage Securities
1.29%; 04/25/34 /2/ 300,000 300,000
3.02%; 10/25/33 75,000 74,370
Residential Asset Securities
4.99%; 02/25/27 248,784 249,619
623,989
INDUSTRIAL GASES (0.10%)
Praxair
4.75%; 07/15/07 115,000 119,555
INSURANCE BROKERS (0.22%)
Aon /2/
6.79%; 01/15/07 110,000 118,992
Marsh & McLennan
3.63%; 02/15/08 145,000 144,034
263,026
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.09%)
AMVESCAP
6.60%; 05/15/05 105,000 109,264
LIFE & HEALTH INSURANCE (0.34%)
Lincoln National
5.25%; 06/15/07 110,000 117,183
ReliaStar Financial
8.63%; 02/15/05 115,000 120,451
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
LIFE & HEALTH INSURANCE (CONTINUED)
Torchmark
$ $
6.25%; 12/15/06 160,000 172,635
410,269
MEDICAL PRODUCTS (0.07%)
Baxter International
5.25%; 05/01/07 80,000 84,055
MEDICAL-DRUGS (0.21%)
Eli Lilly
5.50%; 07/15/06 116,000 123,070
GlaxoSmithKline Capital
2.38%; 04/16/07 130,000 127,394
250,464
MEDICAL-HMO (0.24%)
Anthem
4.88%; 08/01/05 115,000 118,614
UnitedHealth Group
3.30%; 01/30/08 175,000 173,039
291,653
METAL-ALUMINUM (0.30%)
Alcan
6.25%; 11/01/08 95,000 102,369
Alcoa
4.25%; 08/15/07 115,000 118,148
7.25%; 08/01/05 135,000 143,305
363,822
METAL-DIVERSIFIED (0.09%)
Rio Tinto Finance
2.63%; 09/30/08 110,000 104,229
MISCELLANEOUS INVESTING (0.56%)
Archstone-Smith Operating Trust
3.00%; 06/15/08 100,000 95,961
Camden Property Trust
5.88%; 06/01/07 70,000 74,631
CarrAmerica Realty
7.20%; 07/01/04 30,000 30,271
Developers Diversified Realty
3.88%; 01/30/09 120,000 116,388
Duke Realty
3.35%; 01/15/08 115,000 113,495
New Plan Excel Realty Trust
5.88%; 06/15/07 125,000 135,563
Simon Property Group /1/
3.75%; 01/30/09 115,000 111,405
677,714
MONEY CENTER BANKS (1.11%)
Bank of America
4.75%; 10/15/06 640,000 667,168
JP Morgan Chase
3.13%; 12/11/06 80,000 80,214
5.25%; 05/30/07 385,000 405,625
5.35%; 03/01/07 180,000 190,354
1,343,361
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MORTGAGE BACKED SECURITIES (9.51%)
Bear Stearns Commercial Mortgage Securities
$ $
0.72%; 05/11/39 /1/ /2/ 2,700,000 80,187
3.97%; 11/11/35 432,991 430,718
6.08%; 02/15/35 436,719 465,145
7.64%; 02/15/32 764,617 829,372
Chase Commercial Mortgage Securities
7.03%; 01/15/32 342,610 372,055
7.56%; 10/15/32 500,000 572,614
Chase Manhattan Bank-First Union National Bank Commercial Mortgage
Trust
7.13%; 08/15/31 311,296 336,711
Commercial Mortgage Acceptance
6.79%; 06/15/31 63,540 68,364
Commercial Mortgage Pass-Through Certificate /1/
3.25%; 06/10/38 96,118 91,507
CS First Boston Mortgage Securities
4.39%; 07/15/06 190,406 193,893
6.25%; 12/16/35 400,000 431,575
6.38%; 12/16/35 100,000 108,992
DLJ Commercial Mortgage
6.14%; 02/18/31 242,223 249,080
First Union Commercial Mortgage Securities
7.38%; 04/18/29 600,000 653,450
GE Capital Commercial Mortgage
3.35%; 08/11/36 309,124 311,929
5.99%; 12/10/35 130,000 139,462
GMAC Commercial Mortgage Securities
4.32%; 10/15/38 125,594 128,853
6.57%; 09/15/33 282,234 299,561
JP Morgan Chase Commercial Mortgage Securities
4.37%; 10/12/37 471,958 475,004
4.47%; 11/15/35 246,719 252,756
4.55%; 05/12/34 468,327 481,784
JP Morgan Commercial Mortgage Finance
7.07%; 09/15/29 179,931 185,472
LB-UBS Commercial Mortgage Trust
1.41%; 03/15/36 /1/ /2/ 1,691,618 95,857
4.90%; 06/15/26 985,000 1,022,061
5.40%; 03/15/26 419,364 437,301
6.06%; 06/15/20 609,912 651,788
Lehman Large Loan
6.79%; 10/12/34 8,163 8,183
Merrill Lynch Mortgage Investors
7.12%; 06/18/29 372,918 401,823
7.84%; 12/26/25 200,000 212,748
Morgan Stanley Capital I
4.57%; 12/18/32 712,922 732,108
NationsLink Funding
7.23%; 06/20/31 100,000 111,821
PNC Mortgage Acceptance
7.11%; 12/10/32 283,049 306,112
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
MORTGAGE BACKED SECURITIES (CONTINUED)
Wachovia Bank Commercial Mortgage Trust /1/ /2/
$ $
0.33%; 01/15/41 23,477,280 347,581
11,485,867
MULTI-LINE INSURANCE (0.17%)
Allstate
7.88%; 05/01/05 90,000 95,152
Hartford Financial Services Group
4.70%; 09/01/07 105,000 108,673
203,825
MULTIMEDIA (0.70%)
AOL Time Warner
6.13%; 04/15/06 305,000 323,461
Gannett
5.50%; 04/01/07 70,000 74,566
Time Warner
7.98%; 08/15/04 25,000 25,438
Viacom
7.75%; 06/01/05 210,000 222,918
Walt Disney
7.30%; 02/08/05 185,000 192,488
838,871
OIL & GAS DRILLING (0.10%)
Transocean
6.75%; 04/15/05 115,000 119,449
OIL COMPANY-EXPLORATION & PRODUCTION (0.62%)
Anadarko Petroleum
5.38%; 03/01/07 205,000 216,514
Kerr-McGee
5.38%; 04/15/05 70,000 71,869
PennzEnergy
10.25%; 11/01/05 175,000 193,653
Petroleos Mexicanos
6.50%; 02/01/05 260,000 266,500
748,536
OIL COMPANY-INTEGRATED (0.75%)
BP Canada Finance
3.63%; 01/15/09 145,000 142,907
ChevronTexaco Capital
3.38%; 02/15/08 75,000 74,705
Marathon Oil
5.38%; 06/01/07 75,000 79,080
Occidental Petroleum
4.00%; 11/30/07 150,000 151,194
6.50%; 04/01/05 75,000 78,125
Phillips Petroleum
8.50%; 05/25/05 350,000 373,630
899,641
OIL FIELD MACHINERY & EQUIPMENT (0.09%)
Cooper Cameron
2.65%; 04/15/07 115,000 112,345
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
OIL REFINING & MARKETING (0.06%)
Valero Energy
$ $
6.13%; 04/15/07 70,000 75,214
OIL-FIELD SERVICES (0.10%)
Halliburton /2/
2.65%; 10/17/05 120,000 121,390
PAPER & RELATED PRODUCTS (0.21%)
Union Camp
7.00%; 08/15/06 129,000 139,858
Weyerhaeuser
5.50%; 03/15/05 115,000 118,502
258,360
PHOTO EQUIPMENT & SUPPLIES (0.09%)
Eastman Kodak
3.63%; 05/15/08 110,000 104,504
PIPELINES (0.43%)
Duke Energy Field Services
7.50%; 08/16/05 240,000 255,253
Kinder Morgan
6.65%; 03/01/05 150,000 155,739
Kinder Morgan Energy Partners
5.35%; 08/15/07 100,000 105,392
516,384
POULTRY (0.08%)
Tyson Foods
6.63%; 10/01/04 100,000 101,584
PROPERTY & CASUALTY INSURANCE (0.43%)
ACE INA Holdings
8.20%; 08/15/04 200,000 203,691
St. Paul
7.88%; 04/15/05 200,000 210,383
Travelers Property Casualty
3.75%; 03/15/08 105,000 104,776
518,850
PUBLISHING-BOOKS (0.10%)
Reed Elsevier Capital
6.13%; 08/01/06 115,000 123,851
PUBLISHING-NEWSPAPERS (0.08%)
Thomson
5.75%; 02/01/08 95,000 101,244
REAL ESTATE OPERATOR & DEVELOPER (0.26%)
EOP Operating
7.75%; 11/15/07 175,000 198,093
ERP Operating
7.10%; 06/23/04 120,000 120,890
318,983
REGIONAL AUTHORITY (0.76%)
New Brunswick
3.50%; 10/23/07 40,000 40,333
Province of Manitoba
2.75%; 01/17/06 155,000 156,225
Province of Ontario /3/
3.50%; 09/17/07 415,000 416,731
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
REGIONAL AUTHORITY (CONTINUED)
Province of Quebec
$ $
5.50%; 04/11/06 285,000 301,311
914,600
REGIONAL BANKS (2.79%)
Bank One
7.63%; 08/01/05 625,000 666,849
Fifth Third Bancorp
3.38%; 08/15/08 80,000 78,473
First Union
7.55%; 08/18/05 515,000 550,708
FleetBoston Financial
7.25%; 09/15/05 300,000 320,327
KeyCorp
4.63%; 05/16/05 160,000 163,995
Korea Development Bank
3.88%; 03/02/09 120,000 116,708
7.25%; 05/15/06 160,000 173,221
PNC Funding
5.75%; 08/01/06 170,000 180,431
SunTrust Banks
2.50%; 11/01/06 55,000 54,852
5.05%; 07/01/07 70,000 73,360
U.S. Bancorp
6.75%; 10/15/05 202,000 215,230
Wells Fargo
5.90%; 05/21/06 730,000 775,541
3,369,695
REINSURANCE (0.08%)
Berkshire Hathaway /1/
3.38%; 10/15/08 100,000 97,768
RENTAL-AUTO & EQUIPMENT (0.08%)
Hertz
4.70%; 10/02/06 100,000 101,264
RETAIL-DISCOUNT (0.49%)
Costco Wholesale
5.50%; 03/15/07 90,000 95,762
Target
5.40%; 10/01/08 100,000 105,937
Wal-Mart Stores
6.55%; 08/10/04 388,000 393,514
595,213
RETAIL-DRUG STORE (0.08%)
CVS
3.88%; 11/01/07 100,000 100,843
RETAIL-RESTAURANTS (0.10%)
McDonald's
5.38%; 04/30/07 113,000 119,355
SAVINGS & LOANS-THRIFTS (0.32%)
Golden West Financial
4.13%; 08/15/07 100,000 103,282
Washington Mutual
1.40%; 11/03/05 /2/ 140,000 140,214
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
SAVINGS & LOANS-THRIFTS (CONTINUED)
Washington Mutual (continued)
$ $
4.00%; 01/15/09 140,000 137,981
381,477
SOVEREIGN (1.41%)
Finland Government
4.75%; 03/06/07 150,000 156,843
Italy Government
4.38%; 10/25/06 1,075,000 1,111,595
Mexico Government
8.50%; 02/01/06 395,000 432,525
1,700,963
SPECIAL PURPOSE BANKS (1.01%)
KFW International Finance
3.75%; 10/01/04 955,000 964,872
Kreditanstalt fuer Wiederaufbau
2.38%; 09/25/06 250,000 248,945
1,213,817
SPECIAL PURPOSE ENTITY (0.10%)
Fondo Latinoamericano de Reservas /1/
3.00%; 08/01/06 115,000 115,103
SUPRANATIONAL BANK (2.24%)
Asian Development Bank
2.38%; 03/15/06 345,000 346,091
Corp Andina de Fomento
6.75%; 03/15/05 180,000 186,789
8.88%; 06/01/05 75,000 80,019
European Investment Bank /3/
4.63%; 03/01/07 1,320,000 1,383,906
Inter-American Development Bank
6.50%; 10/20/04 685,000 701,526
2,698,331
TELEPHONE-INTEGRATED (1.57%)
BellSouth
5.00%; 10/15/06 225,000 235,559
British Telecommunications
7.88%; 12/15/05 295,000 319,287
CenturyTel
6.30%; 01/15/08 110,000 116,992
Citizens Communications
7.60%; 06/01/06 105,000 111,245
Deutsche Telekom International Finance
8.25%; 06/15/05 170,000 180,959
France Telecom /2/
8.20%; 03/01/06 125,000 135,956
SBC Communications
5.75%; 05/02/06 325,000 343,900
Sprint Capital
7.13%; 01/30/06 335,000 359,365
Telecom Italia Capital /1/
4.00%; 11/15/08 90,000 89,213
1,892,476
TEXTILE-HOME FURNISHINGS (0.11%)
Mohawk Industries
6.50%; 04/15/07 125,000 135,002
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
BONDS (CONTINUED)
TOOLS-HAND HELD (0.08%)
Stanley Works
$ $
3.50%; 11/01/07 100,000 100,504
TRANSPORT-RAIL (0.56%)
Burlington Northern Santa Fe
6.38%; 12/15/05 230,000 243,986
CSX
6.25%; 10/15/08 120,000 129,422
7.25%; 05/01/04 115,000 115,000
Union Pacific
7.60%; 05/01/05 175,000 184,423
672,831
TRANSPORT-SERVICES (0.07%)
FedEx /1/ /2/
1.39%; 04/01/05 85,000 84,986
TOTAL BONDS 110,189,568
Principal
Type Rate Maturity Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) CERTIFICATES (4.25%)
$ $
FHLMC 4.50% 10/01/09 - 05/01/11 3,950,115 3,987,358
FHLMC 5.00% 09/01/09 198,555 202,899
FHLMC 5.50% 12/01/08 - 04/01/09 429,604 439,630
FHLMC 6.50% 04/01/09 - 04/01/15 56,983 60,490
FHLMC 7.00% 12/01/22 180,792 191,857
FHLMC 7.25% 12/01/07 46,857 49,257
FHLMC 7.50% 12/01/29 16,668 17,918
FHLMC 8.00% 12/01/11 - 10/01/22 102,507 111,681
FHLMC 8.25% 01/01/12 7,856 8,511
FHLMC 9.00% 09/01/09 57,009 60,463
TOTAL FHLMC CERTIFICATES 5,130,064
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) CERTIFICATES (2.59%)
FNMA 4.00% 05/01/10 - 08/01/10 1,541,588 1,533,237
FNMA 4.50% 03/01/10 363,373 366,545
FNMA 5.50% 02/01/09 - 10/01/09 697,939 713,326
FNMA 6.00% 07/01/28 159,945 163,914
FNMA 7.50% 10/01/29 80,336 86,007
FNMA 8.00% 10/01/06 - 05/01/27 39,646 42,550
FNMA 8.50% 05/01/22 157,050 172,586
FNMA 9.00% 02/01/25 43,429 48,667
TOTAL FNMA CERTIFICATES 3,126,832
Principal
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (1.55%)
FINANCE-INVESTMENT BANKER & BROKER (1.55%)
Investment in Joint Trading Account; Citigroup
$ $
1.02%; 05/03/04 1,869,973 1,869,973
TOTAL COMMERCIAL PAPER 1,869,973
Maturity
Amount Value
- ------------------------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (0.69%)
Deutsche Bank; 1.02%; dated 04/30/04 maturing 05/03/04 $
(collateralized by FHLMC; $857,249; 02/15/07) /4 / $ 840,511 840,440
TOTAL REPURCHASE AGREEMENTS 840,440
------------
TOTAL PORTFOLIO INVESTMENTS (100.36%) 121,156,877
LIABILITIES, NET OF CASH, RECEIVABLES, AND OTHER
ASSETS (-0.36%) (436,289)
TOTAL NET ASSETS (100.00%) $120,720,588
-----------------
/1 /Restricted Security - The fund held securities which may require
registration under the Securities Act of 1933, or an exemption therefrom, in
order to effect their sale in the ordinary course of business. At the end of
the period, restricted securities totaled $1,455,411 or 1.21% of net assets.
/2 /Variable rate.
/3 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/4 /Security was purchased with the cash proceeds from securities loans.
See accompanying notes.
113
SCHEDULE OF INVESTMENTS
PRINCIPAL MIDCAP FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ---------------------------------------------------------------------------------------------------
COMMON STOCKS (97.72%)
ADVERTISING AGENCIES (1.01%)
$
Interpublic Group /1/ 330,180 5,180,524
AEROSPACE & DEFENSE (1.20%)
Raytheon 120,491 3,887,039
Rockwell Collins 69,243 2,233,087
6,120,126
AEROSPACE & DEFENSE EQUIPMENT (1.36%)
Alliant Techsystems /1/ 117,559 6,970,073
AGRICULTURAL OPERATIONS (0.59%)
Delta & Pine Land 123,356 2,992,617
APPAREL MANUFACTURERS (0.83%)
Polo Ralph Lauren 122,100 4,224,660
APPLICATIONS SOFTWARE (0.50%)
Intuit /1/ 60,517 2,570,157
AUDIO & VIDEO PRODUCTS (0.59%)
Polycom /1/ 157,012 2,995,789
BEVERAGES-NON-ALCOHOLIC (0.45%)
Coca-Cola Enterprises 85,886 2,318,922
BROADCASTING SERVICES & PROGRAMMING (1.49%)
Liberty Media /1/ 698,000 7,636,120
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.64%)
Vulcan Materials 70,683 3,268,382
BUILDING PRODUCTS-AIR & HEATING (0.47%)
American Standard /1/ 22,932 2,412,217
BUILDING PRODUCTS-WOOD (0.38%)
Rayonier 50,176 1,956,864
CASINO HOTELS (1.00%)
Harrah's Entertainment 95,878 5,098,792
CASINO SERVICES (0.60%)
International Game Technology 81,300 3,068,262
COMMERCIAL BANKS (5.58%)
M&T Bank 73,787 6,271,895
Marshall & Ilsley 47,788 1,757,165
North Fork Bancorp. 117,843 4,374,332
SouthTrust 92,606 2,878,194
TCF Financial 242,359 12,008,888
Westamerica Bancorp. 24,866 1,208,488
28,498,962
COMMERCIAL SERVICE-FINANCE (0.95%)
Dun & Bradstreet /1/ 92,485 4,832,341
Shares
Held Value
- ---------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL SERVICES (1.77%)
$
Arbitron /1/ 145,682 5,426,655
Servicemaster 298,124 3,616,244
9,042,899
COMPUTER SERVICES (3.46%)
Ceridian /1/ 238,121 5,091,027
DST Systems /1/ 168,999 7,461,306
Sungard Data Systems /1/ 70,553 1,839,317
Unisys /1/ 251,144 3,272,406
17,664,056
COMPUTERS-INTEGRATED SYSTEMS (2.42%)
Diebold 37,268 1,717,682
NCR /1/ 94,257 4,212,345
Synopsys /1/ 241,580 6,457,434
12,387,461
COMPUTERS-MEMORY DEVICES (1.70%)
Quantum /1/ 60,444 189,190
Storage Technology /1/ 324,353 8,520,753
8,709,943
COMPUTERS-PERIPHERAL EQUIPMENT (2.18%)
Lexmark International /1/ 123,015 11,127,937
COSMETICS & TOILETRIES (0.35%)
International Flavors & Fragrances 48,969 1,775,126
DATA PROCESSING & MANAGEMENT (1.78%)
Certegy 64,900 2,322,122
Reynolds & Reynolds 138,191 3,946,735
SEI Investments 96,505 2,848,828
9,117,685
DENTAL SUPPLIES & EQUIPMENT (0.88%)
Dentsply International 92,549 4,484,925
DIVERSIFIED MANUFACTURING OPERATIONS (0.82%)
ITT Industries 23,967 1,900,343
Lancaster Colony 55,783 2,303,838
4,204,181
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (0.64%)
Viad 131,096 3,272,156
ELECTRIC-INTEGRATED (2.05%)
Ameren 128,222 5,605,866
Duquesne Light Holdings 118,317 2,220,810
Scana 77,068 2,651,139
10,477,815
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.77%)
Gentex 100,055 3,935,163
FOOD-CANNED (0.65%)
Del Monte Foods /1/ 301,203 3,331,305
FOOD-CONFECTIONERY (0.17%)
Tootsie Roll Industries 24,350 848,354
Shares
Held Value
- ---------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FOOD-DAIRY PRODUCTS (0.49%)
$
Dean Foods /1/ 74,308 2,495,263
FOOD-MISCELLANEOUS/DIVERSIFIED (0.88%)
McCormick 131,933 4,506,831
GOLD MINING (0.61%)
Newmont Mining 83,919 3,138,571
HEALTH CARE COST CONTAINMENT (0.50%)
First Health Group /1/ 151,942 2,537,431
HOME FURNISHINGS (0.82%)
Ethan Allen Interiors 100,528 4,178,949
HOSPITAL BEDS & EQUIPMENT (1.16%)
Hillenbrand Industries 88,202 5,953,635
HOTELS & MOTELS (0.36%)
Choice Hotels International 41,171 1,848,578
INSURANCE BROKERS (1.98%)
Aon 239,537 6,242,334
Arthur J. Gallagher 119,926 3,865,215
10,107,549
INVESTMENT MANAGEMENT & ADVISORY SERVICES (1.66%)
Eaton Vance 74,884 2,734,015
Federated Investors 105,105 3,090,087
Nuveen Investments 103,716 2,658,241
8,482,343
LIFE & HEALTH INSURANCE (1.50%)
Aflac 87,826 3,708,892
Torchmark 76,516 3,981,893
7,690,785
LOTTERY SERVICES (1.04%)
GTECH Holdings 87,150 5,309,178
MACHINERY-GENERAL INDUSTRY (0.44%)
Dover 55,873 2,236,596
MACHINERY-PRINT TRADE (0.73%)
Zebra Technologies /1/ 51,151 3,748,857
MACHINERY-PUMPS (0.42%)
Graco 76,047 2,144,525
MEDICAL INFORMATION SYSTEM (1.58%)
IMS Health 320,220 8,085,555
MEDICAL INSTRUMENTS (3.91%)
Beckman Coulter 93,978 5,247,732
Biomet 116,021 4,582,829
Edwards Lifesciences /1/ 126,325 4,353,159
Shares
Held Value
- ---------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL INSTRUMENTS (CONTINUED)
$
Guidant 91,971 5,795,093
19,978,813
MEDICAL PRODUCTS (0.96%)
Becton Dickinson 92,197 4,660,559
Varian Medical Systems /1/ 2,874 246,704
4,907,263
MEDICAL-BIOMEDICAL/GENE (0.97%)
Biogen Idec /1/ 84,099 4,961,841
MEDICAL-DRUGS (0.70%)
Medimmune /1/ 146,871 3,560,153
MEDICAL-HMO (1.19%)
Anthem /1/ 25,388 2,248,869
Oxford Health Plans 70,076 3,814,937
6,063,806
MEDICAL-HOSPITALS (0.84%)
Health Management Associates 116,829 2,702,255
Tenet Healthcare /1/ 133,176 1,566,150
4,268,405
MEDICAL-OUTPATIENT & HOME MEDICAL CARE (0.83%)
Lincare Holdings /1/ /2/ 122,847 4,266,476
METAL-DIVERSIFIED (0.92%)
Freeport-McMoran Copper & Gold /2/ 153,417 4,679,218
MISCELLANEOUS INVESTING (2.42%)
AMB Property 95,773 2,901,922
Federal Realty Investment Trust 62,243 2,307,970
Kimco Realty 108,716 4,646,522
Prologis Trust 85,181 2,506,025
12,362,439
MULTI-LINE INSURANCE (0.75%)
Loews 65,913 3,823,613
MULTIMEDIA (1.31%)
Belo 129,298 3,679,821
E.W. Scripps 28,506 3,008,808
6,688,629
NETWORKING PRODUCTS (0.52%)
3Com /1/ 428,322 2,638,464
NON-HAZARDOUS WASTE DISPOSAL (2.60%)
Republic Services 339,305 9,778,770
Waste Management 124,273 3,529,353
13,308,123
OFFICE AUTOMATION & EQUIPMENT (0.43%)
Pitney Bowes 50,290 2,200,187
OIL COMPANY-EXPLORATION & PRODUCTION (3.02%)
Apache 92,139 3,857,860
Burlington Resources 55,462 3,730,929
Pioneer Natural Resources 101,662 3,325,364
Shares
Held Value
- ---------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
OIL COMPANY-EXPLORATION & PRODUCTION (CONTINUED)
$
XTO Energy 169,353 4,521,725
15,435,878
OIL COMPANY-INTEGRATED (0.96%)
Marathon Oil 145,540 4,884,322
OIL-FIELD SERVICES (1.36%)
BJ Services /1/ 102,839 4,576,336
Weatherford International /1/ 54,569 2,372,660
6,948,996
PAPER & RELATED PRODUCTS (0.64%)
Boise Cascade 96,315 3,248,705
PHOTO EQUIPMENT & SUPPLIES (0.53%)
Eastman Kodak 104,233 2,688,169
PIPELINES (1.67%)
Equitable Resources 74,435 3,497,701
Questar 142,458 5,052,985
8,550,686
POWER CONVERTER & SUPPLY EQUIPMENT (1.03%)
American Power Conversion 282,651 5,274,268
PROPERTY & CASUALTY INSURANCE (3.15%)
Fidelity National Financial 181,156 6,630,310
Leucadia National 113,094 5,572,141
Mercury General 76,732 3,912,565
16,115,016
PUBLISHING-NEWSPAPERS (0.51%)
Knight Ridder 33,849 2,621,267
REAL ESTATE MANAGEMENT & SERVICES (0.05%)
LNR Property 5,075 254,867
REAL ESTATE OPERATOR & DEVELOPER (1.50%)
Catellus Development 126,776 2,732,023
Forest City Enterprises 24,426 1,280,899
St. Joe 93,603 3,669,238
7,682,160
REINSURANCE (1.77%)
Everest Re Group 106,431 9,065,793
RETAIL-APPAREL & SHOE (0.61%)
Ross Stores 101,475 3,094,987
RETAIL-DISCOUNT (1.37%)
Costco Wholesale /1/ 96,561 3,616,209
TJX 138,443 3,401,545
7,017,754
RETAIL-HOME FURNISHINGS (0.43%)
Pier 1 Imports 107,539 2,221,756
Shares
Held Value
- ---------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-JEWELRY (0.44%)
$
Tiffany 57,582 2,245,698
RETAIL-REGIONAL DEPARTMENT STORE (0.70%)
Neiman Marcus Group 73,471 3,573,629
RETAIL-RESTAURANTS (0.77%)
Yum! Brands /1/ 101,267 3,928,147
SAVINGS & LOANS-THRIFTS (1.04%)
Charter One Financial 159,764 5,331,325
TELECOMMUNICATION EQUIPMENT (1.22%)
Comverse Technology /1/ 380,309 6,221,855
TELEPHONE-INTEGRATED (1.45%)
Citizens Communications /1/ 287,980 3,755,259
IDT /1/ 113,145 2,103,366
Telephone & Data Systems 23,174 1,528,557
7,387,182
TEXTILE-HOME FURNISHINGS (1.02%)
Mohawk Industries /1/ 67,903 5,238,037
TOBACCO (1.40%)
UST 192,299 7,155,446
TOYS (0.65%)
Mattel 194,478 3,298,347
TRANSPORT-TRUCK (0.63%)
Heartland Express 130,581 3,205,764
TOTAL COMMON STOCKS 499,385,944
Principal
Amount Value
- ---------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (2.11%)
FINANCE-INVESTMENT BANKER & BROKER (2.11%)
Investment in Joint Trading Account; Citigroup 100,000,000
$ $
1.02%; 05/03/04 10,782,333 10,782,333
TOTAL COMMERCIAL PAPER 10,782,333
Maturity
Amount Value
- ---------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (1.39%)
Goldman Sachs; 0.93%; dated 04/30/04 maturing
05/03/04 (collateralized by U.S. Treasury $
Strips; $7,274,649; 02/15/06 - 08/15/26) /3/ $ 7,132,553 7,132,000
TOTAL REPURCHASE AGREEMENTS 7,132,000
------------
TOTAL PORTFOLIO INVESTMENTS (101.22%) 517,300,277
LIABILITIES, NET OF CASH, RECEIVABLES, AND
OTHER ASSETS (-1.22%) (6,247,702)
TOTAL NET ASSETS (100.00%) $511,052,575
---------------
/1 /Non-income producing security.
/2 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/3 /Security was purchased with the cash proceeds from securities loans.
See accompanying notes.
117
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS BLUE CHIP FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- -------------------------------------------------------------------------------------------
COMMON STOCKS (99.83%)
AEROSPACE & DEFENSE (0.65%)
$
Boeing 23,300 994,677
AEROSPACE & DEFENSE EQUIPMENT (0.72%)
General Dynamics 3,600 337,032
United Technologies 8,800 759,088
1,096,120
AGRICULTURAL OPERATIONS (0.61%)
Monsanto 27,200 940,848
AIRLINES (0.07%)
Southwest Airlines 7,400 105,672
APPAREL MANUFACTURERS (0.60%)
Coach /1/ 21,500 915,900
APPLICATIONS SOFTWARE (2.64%)
Microsoft 155,744 4,044,672
ATHLETIC FOOTWEAR (0.38%)
Nike 8,144 585,961
AUDIO & VIDEO PRODUCTS (0.13%)
Harman International Industries 2,700 204,795
AUTO-CARS & LIGHT TRUCKS (1.45%)
Ford Motor 67,700 1,039,872
General Motors 25,000 1,185,500
2,225,372
BEVERAGES-NON-ALCOHOLIC (1.62%)
Coca-Cola 28,500 1,441,245
Pepsico 19,172 1,044,682
2,485,927
BROADCASTING SERVICES & PROGRAMMING (0.53%)
Fox Entertainment Group /1/ 29,200 813,220
CABLE TV (0.72%)
Comcast /1/ 23,300 701,330
Comcast /1/ 13,921 403,570
1,104,900
CELLULAR TELECOMMUNICATIONS (0.35%)
AT&T Wireless Services /1/ 28,000 386,680
U.S. Cellular /1/ 4,200 143,934
530,614
CHEMICALS-DIVERSIFIED (0.75%)
Dow Chemical 15,398 611,147
E. I. Du Pont de Nemours 12,700 545,465
1,156,612
COMMERCIAL BANKS (0.43%)
Bank of Hawaii 10,500 459,060
UnionBanCal 3,800 203,034
662,094
COMMERCIAL SERVICE-FINANCE (0.69%)
Deluxe 2,700 111,537
Moody's 14,600 941,846
1,053,383
Shares
Held Value
- -------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL SERVICES (0.06%)
$
Convergys /1/ 6,700 97,284
COMPUTER AIDED DESIGN (0.16%)
Cadence Design Systems /1/ 18,700 239,734
COMPUTERS (1.31%)
Hewlett-Packard 37,000 728,900
International Business Machines 14,488 1,277,407
2,006,307
COMPUTERS-INTEGRATED SYSTEMS (1.00%)
Dell /1/ 39,000 1,353,690
NCR /1/ 4,000 178,760
1,532,450
COMPUTERS-MEMORY DEVICES (0.24%)
EMC /1/ 13,100 146,196
SanDisk /1/ 4,300 99,373
Storage Technology /1/ 4,600 120,842
366,411
COMPUTERS-PERIPHERAL EQUIPMENT (0.46%)
Lexmark International /1/ 7,800 705,588
CONSULTING SERVICES (0.76%)
Accenture /1/ 48,706 1,157,742
CONSUMER PRODUCTS-MISCELLANEOUS (0.12%)
American Greetings /1/ 8,700 178,350
COSMETICS & TOILETRIES (3.87%)
Avon Products 10,800 907,200
Gillette 52,727 2,157,589
Procter & Gamble 27,045 2,860,009
5,924,798
CRUISE LINES (0.09%)
Royal Caribbean Cruises 3,300 133,749
DATA PROCESSING & MANAGEMENT (0.48%)
First Data 16,300 739,857
DISTRIBUTION-WHOLESALE (0.05%)
Ingram Micro /1/ 6,200 74,090
DIVERSIFIED FINANCIAL SERVICES (2.58%)
Citigroup 82,090 3,947,708
DIVERSIFIED MANUFACTURING OPERATIONS (6.28%)
3M 26,030 2,251,074
General Electric 151,583 4,539,911
ITT Industries 7,000 555,030
Tyco International 83,100 2,281,095
9,627,110
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (0.14%)
Cendant 9,100 215,488
ELECTRIC-INTEGRATED (1.46%)
Edison International 41,700 975,780
Entergy 6,800 371,280
Exelon 13,216 884,679
2,231,739
Shares
Held Value
- -------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.23%)
$
Sanmina /1/ 35,000 350,700
ELECTRONIC COMPONENTS-SEMICONDUCTOR (3.29%)
Intel 136,768 3,519,041
Texas Instruments 60,800 1,526,080
5,045,121
ELECTRONIC FORMS (0.45%)
Adobe Systems 16,500 682,110
ELECTRONIC MEASUREMENT INSTRUMENTS (0.49%)
Agilent Technologies /1/ 27,800 750,878
ELECTRONIC PARTS DISTRIBUTION (0.22%)
Avnet /1/ 15,400 333,256
ENTERPRISE SOFTWARE & SERVICE (0.61%)
BMC Software /1/ 11,400 197,220
Computer Associates International 27,300 731,913
929,133
FIDUCIARY BANKS (0.23%)
State Street 7,081 345,553
FINANCE-AUTO LOANS (0.13%)
AmeriCredit /1/ 12,400 201,004
FINANCE-COMMERCIAL (0.54%)
CIT Group 23,900 821,443
FINANCE-CONSUMER LOANS (0.07%)
SLM 2,600 99,606
FINANCE-CREDIT CARD (0.74%)
American Express 8,400 411,180
MBNA 29,600 721,648
1,132,828
FINANCE-INVESTMENT BANKER & BROKER (1.83%)
Bear Stearns 5,200 416,728
Friedman, Billings, Ramsey Group 16,500 305,250
Lehman Brothers Holdings 2,000 146,800
Merrill Lynch 35,698 1,935,902
2,804,680
FINANCE-MORTGAGE LOAN/BANKER (0.40%)
Federal National Mortgage Association 8,911 612,364
FINANCIAL GUARANTEE INSURANCE (0.77%)
MBIA 14,800 871,572
MGIC Investment 4,100 301,842
1,173,414
FOOD-FLOUR & GRAIN (0.67%)
Archer Daniels Midland 58,600 1,029,016
FOOD-MISCELLANEOUS/DIVERSIFIED (0.54%)
Kraft Foods 25,300 832,623
FOOD-WHOLESALE & DISTRIBUTION (0.92%)
Supervalu 9,800 301,742
Sysco 29,100 1,113,075
1,414,817
Shares
Held Value
- -------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
INDUSTRIAL AUTOMATION & ROBOTS (0.07%)
$
Rockwell International 3,400 111,146
INTERNET BROKERS (0.06%)
Ameritrade Holding /1/ 7,400 90,576
INTERNET FINANCIAL SERVICES (0.07%)
IndyMac Bancorp 3,400 109,344
INTERNET SECURITY (0.50%)
Symantec /1/ 16,900 761,345
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.20%)
Franklin Resources 5,700 312,531
LIFE & HEALTH INSURANCE (0.08%)
Lincoln National 2,700 121,176
LOTTERY SERVICES (0.30%)
GTECH Holdings 7,500 456,900
MACHINERY-CONSTRUCTION & MINING (0.36%)
Caterpillar 7,060 548,774
MACHINERY-PUMPS (0.09%)
Graco 4,800 135,360
MEDICAL INFORMATION SYSTEM (0.37%)
IMS Health 22,600 570,650
MEDICAL INSTRUMENTS (1.78%)
Boston Scientific /1/ 24,300 1,000,917
Guidant 20,151 1,269,714
Medtronic 9,200 464,232
2,734,863
MEDICAL PRODUCTS (2.41%)
Johnson & Johnson 47,800 2,582,634
Zimmer Holdings /1/ 13,900 1,109,915
3,692,549
MEDICAL-BIOMEDICAL/GENE (1.66%)
Amgen /1/ 32,226 1,813,357
Biogen Idec /1/ 2,000 118,000
Genentech /1/ 4,300 528,040
Genzyme /1/ 1,900 82,764
2,542,161
MEDICAL-DRUGS (6.73%)
Abbott Laboratories 16,933 745,391
Allergan 10,200 898,110
AstraZeneca 7,400 354,090
Eli Lilly 20,333 1,500,779
King Pharmaceuticals /1/ 21,500 370,875
Merck 3,400 159,800
Pfizer 157,750 5,641,140
Wyeth 16,832 640,794
10,310,979
MEDICAL-HMO (0.94%)
Anthem /1/ 4,900 434,042
Humana /1/ 19,100 311,139
UnitedHealth Group 11,200 688,576
1,433,757
Shares
Held Value
- -------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.31%)
$
Cardinal Health 6,500 476,125
METAL-ALUMINUM (0.23%)
Alcoa 11,681 359,191
METAL-DIVERSIFIED (0.09%)
Freeport-McMoran Copper & Gold 4,500 137,250
MISCELLANEOUS INVESTING (0.17%)
Equity Office Properties Trust 10,600 266,802
MONEY CENTER BANKS (2.77%)
Bank of America 52,809 4,250,596
MULTI-LINE INSURANCE (3.71%)
American International Group 36,087 2,585,633
Loews 15,500 899,155
MetLife 32,700 1,128,150
Prudential Financial 24,500 1,076,530
5,689,468
MULTIMEDIA (3.33%)
Time Warner /1/ 160,219 2,694,883
Viacom 49,200 1,901,580
Walt Disney 21,900 504,357
5,100,820
NETWORKING PRODUCTS (0.98%)
Cisco Systems /1/ 72,019 1,503,036
NON-HAZARDOUS WASTE DISPOSAL (0.24%)
Republic Services 9,000 259,380
Waste Management 4,000 113,600
372,980
OIL & GAS DRILLING (0.54%)
Transocean Sedco Forex /1/ 29,900 830,323
OIL COMPANY-EXPLORATION & PRODUCTION (0.50%)
Anadarko Petroleum 14,400 771,552
OIL COMPANY-INTEGRATED (4.45%)
ChevronTexaco 14,942 1,367,193
ConocoPhillips 13,500 962,550
Exxon Mobil 78,491 3,339,792
Marathon Oil 11,100 372,516
Occidental Petroleum 16,600 783,520
6,825,571
OIL REFINING & MARKETING (1.12%)
Sunoco 15,000 943,500
Valero Energy 12,100 771,496
1,714,996
OIL-FIELD SERVICES (0.90%)
Schlumberger 23,619 1,382,420
PAPER & RELATED PRODUCTS (0.59%)
Georgia-Pacific 6,300 221,130
International Paper 13,646 550,207
Louisiana-Pacific 5,800 136,822
908,159
Shares
Held Value
- -------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PHARMACY SERVICES (0.10%)
$
Medco Health Solutions /1/ 4,365 154,521
PHOTO EQUIPMENT & SUPPLIES (0.21%)
Eastman Kodak 12,500 322,375
POULTRY (0.60%)
Tyson Foods 49,200 922,008
PROPERTY & CASUALTY INSURANCE (0.53%)
Fidelity National Financial 7,865 287,859
St. Paul 12,703 516,631
804,490
REAL ESTATE MANAGEMENT & SERVICES (0.13%)
LNR Property 4,000 200,880
REGIONAL BANKS (3.95%)
Bank One 25,456 1,256,763
National City 10,200 353,634
SunTrust Banks 4,800 326,640
U.S. Bancorp 35,800 917,912
Wachovia 32,500 1,486,875
Wells Fargo 30,200 1,705,092
6,046,916
RETAIL-APPAREL & SHOE (0.16%)
Gap 11,200 246,512
RETAIL-AUTOMOBILE (0.45%)
AutoNation /1/ 40,500 689,310
RETAIL-BUILDING PRODUCTS (0.78%)
Home Depot 3,100 109,089
Lowe's 21,000 1,093,260
1,202,349
RETAIL-CONSUMER ELECTRONICS (0.47%)
Best Buy 13,400 726,950
RETAIL-DISCOUNT (1.99%)
Wal-Mart Stores 53,370 3,042,090
RETAIL-DRUG STORE (0.28%)
CVS 11,000 424,930
RETAIL-MAJOR DEPARTMENT STORE (1.09%)
J.C. Penney 11,400 386,004
Saks /1/ 33,200 478,080
Sears Roebuck 20,200 809,010
1,673,094
RETAIL-OFFICE SUPPLIES (0.23%)
Staples 13,900 358,064
RETAIL-REGIONAL DEPARTMENT STORE (0.60%)
Federated Department Stores 18,700 916,300
RETAIL-RESTAURANTS (0.07%)
Bob Evans Farms 3,400 104,244
SATELLITE TELECOM (0.17%)
PanAmSat /1/ /2/ 11,500 265,420
Shares
Held Value
- -------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
SAVINGS & LOANS-THRIFTS (0.39%)
$
Charter One Financial 8,600 286,982
Hudson City Bancorp 6,000 202,800
Washington Mutual 2,700 106,353
596,135
SCHOOLS (0.13%)
ITT Educational Services /1/ 5,000 201,650
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (0.07%)
Maxim Integrated Products 2,400 110,376
SEMICONDUCTOR EQUIPMENT (0.31%)
Applied Materials /1/ 26,300 479,449
STEEL PRODUCERS (0.07%)
Carpenter Technology 3,800 103,778
TELECOMMUNICATION EQUIPMENT (0.50%)
Qualcomm 12,200 762,012
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.28%)
Corning /1/ 39,200 432,376
TELECOMMUNICATION SERVICES (0.06%)
Avaya /1/ 6,500 88,920
TELEPHONE-INTEGRATED (2.29%)
BellSouth 51,300 1,324,053
SBC Communications 10,700 266,430
Sprint 85,500 1,529,595
Telephone & Data Systems 1,600 105,536
Verizon Communications 7,600 286,824
3,512,438
THERAPEUTICS (0.35%)
Gilead Sciences /1/ 8,700 529,221
TOBACCO (0.88%)
Altria Group 5,600 310,128
RJ Reynolds Tobacco Holdings 16,000 1,036,320
1,346,448
TOYS (0.06%)
Hasbro 4,700 88,783
TRANSPORT-MARINE (0.12%)
Overseas Shipholding Group 5,700 186,789
TRANSPORT-RAIL (0.61%)
Burlington Northern Santa Fe 13,300 434,910
CSX 16,400 504,464
939,374
TRANSPORT-SERVICES (1.52%)
FedEx 8,345 600,089
United Parcel Service 24,600 1,725,690
2,325,779
WEB PORTALS (0.16%)
Yahoo /1/ 5,000 252,300
Shares
Held Value
- -------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
WIRELESS EQUIPMENT (1.14%)
$
Motorola 95,800 1,748,350
TOTAL COMMON STOCKS 152,983,749
Maturity
Amount Value
- -------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (0.18%)
Goldman Sachs; 0.93%; dated 04/30/04
maturing 05/03/04 (collateralized by U.S.
Treasury Strips; $278,460; 02/15/06 -
08/15/26) /3/ $273,021 $ 273,000
TOTAL REPURCHASE AGREEMENTS 273,000
------------
TOTAL PORTFOLIO INVESTMENTS (100.01%) 153,256,749
LIABILITIES, NET OF CASH, RECEIVABLES, AND OTHER ASSETS
(-0.01%) (19,345)
TOTAL NET ASSETS (100.00%) $153,237,404
---------------
Unrealized
Contract Opening Current Gain (Loss)
Type Commitment Market Value Market Value
- ----------------------------------------------------------------------
FUTURES CONTRACTS
3 S&P 500 eMini Buy $170,969 $165,915 $(5,054)
June, 2004
Futures
/1/ Non-income producing security.
/2/ Security or a portion of the security was on loan at the end of the
period. See notes to financial statements.
/3/ Scurity was purchased with the cash proceeds from securities loans.
121
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS EQUITY GROWTH FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ----------------------------------------------------------------------------------------------------
COMMON STOCKS (99.19%)
AEROSPACE & DEFENSE EQUIPMENT (1.07%)
$
United Technologies 7,590 654,713
APPAREL MANUFACTURERS (0.27%)
Coach /1/ 3,800 161,880
APPLICATIONS SOFTWARE (6.69%)
Mercury Interactive /1/ 14,000 595,700
Microsoft 120,450 3,128,086
Red Hat /1/ 15,600 354,276
4,078,062
BEVERAGES-NON-ALCOHOLIC (3.66%)
Coca-Cola 30,305 1,532,524
Pepsico 12,825 698,834
2,231,358
BROADCASTING SERVICES & PROGRAMMING (1.40%)
Clear Channel Communications 20,500 850,545
CASINO HOTELS (0.77%)
Wynn Resorts /1/ /2/ 11,810 471,573
CASINO SERVICES (0.82%)
International Game Technology 13,300 501,942
COMPUTERS-INTEGRATED SYSTEMS (1.50%)
Dell /1/ 26,350 914,608
COMPUTERS-MEMORY DEVICES (1.15%)
EMC /1/ 36,625 408,735
Veritas Software /1/ 11,010 293,637
702,372
CONSULTING SERVICES (0.97%)
Accenture /1/ 24,860 590,922
COSMETICS & TOILETRIES (1.91%)
Kimberly-Clark 7,400 484,330
Procter & Gamble 6,400 676,800
1,161,130
CRUISE LINES (0.54%)
Carnival 7,700 328,559
DIVERSIFIED FINANCIAL SERVICES (3.90%)
Citigroup 49,366 2,374,011
DIVERSIFIED MANUFACTURING OPERATIONS (8.68%)
3M 11,800 1,020,464
General Electric 122,150 3,658,392
Tyco International 22,200 609,390
5,288,246
E-COMMERCE-SERVICES (4.62%)
eBay /1/ 16,580 1,323,415
InterActiveCorp /1/ 46,870 1,493,747
2,817,162
ELECTRONIC COMPONENTS-SEMICONDUCTOR (3.28%)
Intel 45,900 1,181,007
Texas Instruments 32,625 818,887
1,999,894
Shares
Held Value
- ----------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC CONNECTORS (0.74%)
$
Amphenol /1/ 14,200 448,862
ELECTRONIC FORMS (0.75%)
Adobe Systems 11,000 454,740
ENTERPRISE SOFTWARE & SERVICE (0.70%)
Oracle /1/ 37,800 424,116
FIDUCIARY BANKS (0.94%)
Bank of New York 19,650 572,601
FINANCE-CREDIT CARD (2.66%)
American Express 19,400 949,630
MBNA 27,500 670,450
1,620,080
FINANCE-INVESTMENT BANKER & BROKER (0.92%)
Goldman Sachs Group 5,775 557,288
FINANCE-MORTGAGE LOAN/BANKER (1.43%)
Federal National Mortgage Association 12,700 872,744
HEALTH CARE COST CONTAINMENT (0.74%)
Caremark Rx /1/ 13,250 448,513
INDUSTRIAL AUTOMATION & ROBOTS (0.38%)
Rockwell International 7,135 233,243
LOTTERY SERVICES (0.82%)
GTECH Holdings 8,230 501,372
MEDICAL INSTRUMENTS (3.22%)
Boston Scientific /1/ 20,800 856,752
Guidant 3,600 226,836
Medtronic 11,975 604,258
St. Jude Medical /1/ 3,625 276,443
1,964,289
MEDICAL PRODUCTS (1.49%)
INAMED /1/ 3,490 205,352
Johnson & Johnson 12,975 701,039
906,391
MEDICAL-BIOMEDICAL/GENE (3.11%)
Amgen /1/ 16,520 929,580
Biogen Idec /1/ 3,800 224,200
Chiron /1/ 4,300 199,520
Genentech /1/ 4,400 540,320
1,893,620
MEDICAL-DRUGS (7.04%)
Allergan 2,230 196,352
Bristol-Myers Squibb 12,500 313,750
Eli Lilly 8,200 605,242
Pfizer 76,795 2,746,189
Teva Pharmaceutical Industries /2/ 6,900 424,764
4,286,297
MEDICAL-HMO (1.96%)
Anthem /1/ 6,110 541,224
UnitedHealth Group 10,650 654,762
1,195,986
Shares
Held Value
- ----------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MULTI-LINE INSURANCE (2.04%)
$
American International Group 17,375 1,244,919
MULTIMEDIA (1.24%)
News /2/ 11,445 418,429
Viacom 8,720 337,028
755,457
NETWORKING PRODUCTS (3.36%)
Cisco Systems /1/ 67,325 1,405,073
Juniper Networks /1/ 17,400 380,712
Network Appliance /1/ 14,100 262,542
2,048,327
OIL COMPANY-INTEGRATED (1.80%)
Exxon Mobil 25,800 1,097,790
OIL FIELD MACHINERY & EQUIPMENT (1.03%)
Smith International /1/ 11,500 629,625
REGIONAL BANKS (1.73%)
Fifth Third Bancorp 9,650 517,819
Wells Fargo 9,450 533,547
1,051,366
RETAIL-APPAREL & SHOE (0.68%)
Chico's FAS /1/ /2/ 10,172 414,306
RETAIL-BEDDING (0.48%)
Bed Bath & Beyond /1/ 7,800 289,536
RETAIL-BUILDING PRODUCTS (1.69%)
Home Depot 12,380 435,652
Lowe's 11,400 593,484
1,029,136
RETAIL-DISCOUNT (3.12%)
Target 9,515 412,666
TJX 9,850 242,014
Wal-Mart Stores 21,850 1,245,450
1,900,130
RETAIL-JEWELRY (0.39%)
Tiffany 6,027 235,053
RETAIL-OFFICE SUPPLIES (0.66%)
Staples 15,700 404,432
RETAIL-PET FOOD & SUPPLIES (0.95%)
PETsMART 20,940 580,038
RETAIL-RESTAURANTS (1.08%)
Outback Steakhouse 7,800 342,654
Yum! Brands /1/ 8,120 314,975
657,629
SCHOOLS (1.11%)
Apollo Group /1/ 7,450 677,056
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (3.01%)
Analog Devices 18,900 805,140
Linear Technology 17,950 639,558
Marvell Technology Group /1/ 10,100 391,173
1,835,871
Shares
Held Value
- ----------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
SEMICONDUCTOR EQUIPMENT (0.63%)
$
Applied Materials /1/ 21,025 383,286
TELECOMMUNICATION EQUIPMENT (0.73%)
Qualcomm 7,075 441,905
TELEVISION (1.11%)
Univision Communications /1/ 20,060 679,031
THERAPEUTICS (0.31%)
Gilead Sciences /1/ 3,150 191,615
TRANSPORT-SERVICES (1.40%)
C.H. Robinson Worldwide 10,895 447,131
United Parcel Service 5,800 406,870
854,001
WEB PORTALS (1.91%)
Yahoo /1/ /2/ 23,010 1,161,085
WIRELESS EQUIPMENT (0.60%)
Motorola 19,900 363,175
TOTAL COMMON STOCKS 60,431,888
Maturity
Amount Value
- ----------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (4.96%)
Goldman Sachs; 0.93%; dated 04/30/04 maturing
05/03/04 (collateralized by U.S. Treasury Strips;
$3,083,464; 02/15/06 - 08/15/26) /3/ $3,023,234 $ 3,023,000
TOTAL REPURCHASE AGREEMENTS 3,023,000
-----------
TOTAL PORTFOLIO INVESTMENTS (104.15%) 63,454,888
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER
ASSETS (-4.15%) (2,530,672)
TOTAL NET ASSETS (100.00%) $60,924,216
--------------
/1/ Non-income producing security.
/2/ Security or a portion of the security was on loan at the end of the
period. See notes to financial statements.
/3/ Scurity was purchased with the cash proceeds from securities loans.
121
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (98.85%)
AEROSPACE & DEFENSE (0.64%)
$
Boeing 3,800 162,222
Northrop Grumman 1,000 99,250
Raytheon 1,900 61,294
Rockwell Collins 800 25,800
348,566
AEROSPACE & DEFENSE EQUIPMENT (0.91%)
General Dynamics 1,000 93,620
Lockheed Martin 3,100 147,870
United Technologies 2,900 250,154
491,644
AGRICULTURAL CHEMICALS (0.44%)
Agrium 5,200 64,688
IMC Global 3,700 46,509
Potash Corp. of Saskatchewan 1,600 130,336
241,533
AIRLINES (0.12%)
Southwest Airlines 4,500 64,260
APPLICATIONS SOFTWARE (3.33%)
Intuit /1/ 2,900 123,163
Mercury Interactive /1/ 2,200 93,610
Microsoft 60,400 1,568,588
Siebel Systems /1/ 2,100 21,588
1,806,949
AUDIO & VIDEO PRODUCTS (0.08%)
Digital Theater Systems /1/ 2,000 44,740
AUTO-CARS & LIGHT TRUCKS (0.48%)
General Motors 5,500 260,810
BEVERAGES-NON-ALCOHOLIC (2.52%)
Coca-Cola 13,900 702,923
Cott /1/ 3,100 94,116
Pepsico 10,500 572,145
1,369,184
BREWERY (0.26%)
Anheuser-Busch 2,800 143,472
BROADCASTING SERVICES & PROGRAMMING (0.60%)
Clear Channel Communications 7,800 323,622
BUILDING PRODUCTS-AIR & HEATING (0.08%)
American Standard /1/ 400 42,076
CABLE TV (0.10%)
Comcast /1/ 1,800 54,180
CASINO HOTELS (0.07%)
Station Casinos 900 40,572
CASINO SERVICES (0.24%)
International Game Technology 3,500 132,090
CELLULAR TELECOMMUNICATIONS (1.39%)
Crown Castle International /1/ 7,400 103,230
Nextel Communications /1/ 9,400 224,284
Nextel Partners /1/ 5,200 69,420
NII Holdings /1/ 3,500 122,500
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
CELLULAR TELECOMMUNICATIONS (CONTINUED)
$
Western Wireless /1/ 11,300 235,266
754,700
CHEMICALS-DIVERSIFIED (0.64%)
Dow Chemical 7,500 297,675
E. I. Du Pont de Nemours 1,200 51,540
349,215
CHEMICALS-SPECIALTY (0.29%)
Cabot 1,600 54,080
Great Lakes Chemical 600 15,072
Millennium Chemicals /1/ 4,100 67,117
Minerals Technologies 400 23,460
159,729
CIRCUIT BOARDS (0.09%)
Jabil Circuit /1/ 1,900 50,141
COMMERCIAL BANKS (0.06%)
First Horizon National 800 35,168
COMMERCIAL SERVICE-FINANCE (0.37%)
Moody's 900 58,059
Paychex 3,800 141,664
199,723
COMPUTER SERVICES (0.24%)
DST Systems /1/ 2,900 128,035
COMPUTERS (1.86%)
Hewlett-Packard 11,900 234,430
International Business Machines 7,300 643,641
Research In Motion /1/ 1,500 130,140
1,008,211
COMPUTERS-INTEGRATED SYSTEMS (1.54%)
Dell /1/ 24,100 836,511
COMPUTERS-MEMORY DEVICES (0.13%)
Veritas Software /1/ 2,700 72,009
COMPUTERS-PERIPHERAL EQUIPMENT (0.28%)
Lexmark International /1/ 1,700 153,782
CONSUMER PRODUCTS-MISCELLANEOUS (0.43%)
Clorox 1,700 88,026
Fortune Brands 1,900 144,875
232,901
COSMETICS & TOILETRIES (2.56%)
Colgate-Palmolive 2,600 150,488
Gillette 5,100 208,692
Kimberly-Clark 2,200 143,990
Procter & Gamble 8,400 888,300
1,391,470
CRUISE LINES (0.34%)
Carnival 4,300 183,481
DATA PROCESSING & MANAGEMENT (0.46%)
Certegy 1,700 60,826
Choicepoint /1/ 1,600 70,272
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DATA PROCESSING & MANAGEMENT (CONTINUED)
$
Fiserv /1/ 3,300 120,648
251,746
DECISION SUPPORT SOFTWARE (0.09%)
NetIQ /1/ 3,600 46,296
DISPOSABLE MEDICAL PRODUCTS (0.12%)
C.R. Bard 600 63,762
DISTRIBUTION-WHOLESALE (0.18%)
CDW 1,600 99,984
DIVERSIFIED FINANCIAL SERVICES (2.38%)
Citigroup 26,900 1,293,621
DIVERSIFIED MANUFACTURING OPERATIONS (6.17%)
Danaher 2,500 231,300
General Electric 67,400 2,018,630
Honeywell International 7,000 242,060
Illinois Tool Works 3,200 275,872
ITT Industries 500 39,645
Roper Industries 1,000 48,550
Tyco International 18,000 494,100
3,350,157
DIVERSIFIED MINERALS (0.08%)
BHP Billiton 2,800 45,948
E-COMMERCE-SERVICES (0.26%)
InterActiveCorp /1/ 3,300 105,171
Monster Worldwide /1/ 1,300 33,293
138,464
ELECTRIC-INTEGRATED (2.64%)
American Electric Power 900 27,396
Constellation Energy Group 1,200 46,176
Duke Energy 6,900 145,314
Edison International 3,200 74,880
El Paso Electric /1/ 2,800 39,620
Entergy 1,100 60,060
Exelon 1,800 120,492
FirstEnergy 5,600 218,960
NiSource 3,000 60,480
PG&E /1/ 3,400 93,568
Pinnacle West Capital 1,800 70,308
PPL 2,200 94,270
Southern 2,100 60,396
TECO Energy 1,400 17,822
TXU 7,900 269,706
XCEL Energy 1,900 31,787
1,431,235
ELECTRONIC COMPONENTS-SEMICONDUCTOR (2.38%)
Intel 34,500 887,685
QLogic /1/ 3,600 97,164
Texas Instruments 6,600 165,660
Xilinx 4,200 141,246
1,291,755
ELECTRONIC FORMS (0.10%)
Adobe Systems 1,300 53,742
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ENTERPRISE SOFTWARE & SERVICE (0.67%)
$
Oracle /1/ 32,500 364,650
FIDUCIARY BANKS (0.95%)
Bank of New York 4,800 139,872
Investors Financial Services 3,500 136,045
Mellon Financial 2,700 80,028
State Street 3,300 161,040
516,985
FILTRATION & SEPARATION PRODUCTS (0.11%)
Pall 2,400 57,072
FINANCE-CONSUMER LOANS (0.15%)
SLM 2,100 80,451
FINANCE-CREDIT CARD (0.73%)
American Express 8,100 396,495
FINANCE-INVESTMENT BANKER & BROKER (1.94%)
Goldman Sachs Group 2,900 279,850
Lehman Brothers Holdings 2,000 146,800
Merrill Lynch 5,500 298,265
Morgan Stanley 6,400 328,896
1,053,811
FINANCE-MORTGAGE LOAN/BANKER (1.24%)
Federal Home Loan Mortgage 6,200 362,080
Federal National Mortgage Association 4,500 309,240
671,320
FINANCIAL GUARANTEE INSURANCE (0.37%)
MGIC Investment 1,300 95,706
Radian Group 2,300 106,973
202,679
FOOD-CONFECTIONERY (0.15%)
Hershey Foods 700 62,223
Wm. Wrigley Jr. 300 18,510
80,733
FOOD-MISCELLANEOUS/DIVERSIFIED (0.69%)
Campbell Soup 3,100 85,653
General Mills 3,500 170,625
H.J. Heinz 800 30,552
Kellogg 2,100 90,090
376,920
FOOD-WHOLESALE & DISTRIBUTION (0.26%)
Sysco 3,700 141,525
GOLD MINING (0.34%)
Newmont Mining 4,900 183,260
HEALTH CARE COST CONTAINMENT (0.17%)
Caremark Rx /1/ 2,800 94,780
HOME DECORATION PRODUCTS (0.27%)
Newell Rubbermaid 6,100 144,204
HOTELS & MOTELS (0.04%)
Fairmont Hotels & Resorts 800 19,760
HUMAN RESOURCES (0.40%)
Exult /1/ 20,100 122,811
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
HUMAN RESOURCES (CONTINUED)
$
Manpower 1,100 51,590
Robert Half International 1,500 40,905
215,306
INSURANCE BROKERS (0.26%)
Marsh & McLennan 3,100 139,810
INTERNET APPLICATION SOFTWARE (0.16%)
MatrixOne /1/ 7,500 45,075
Verity /1/ 3,200 39,680
84,755
INTERNET BROKERS (0.38%)
Ameritrade Holding /1/ 9,500 116,280
E*trade Group /1/ 7,900 89,744
206,024
INTERNET INFRASTRUCTURE SOFTWARE (0.04%)
F5 Networks /1/ 900 22,860
INTERNET SECURITY (0.20%)
CheckFree /1/ 900 27,036
Network Associates /1/ 5,300 83,104
110,140
INVESTMENT MANAGEMENT & ADVISORY SERVICES (0.44%)
Eaton Vance 1,800 65,718
Federated Investors 1,100 32,340
Franklin Resources 2,000 109,660
Waddell & Reed Financial 1,400 31,122
238,840
LEISURE & RECREATION PRODUCTS (0.29%)
Brunswick 2,200 90,442
Multimedia Games /1/ 3,100 69,068
159,510
LIFE & HEALTH INSURANCE (0.15%)
Protective Life 700 25,172
UnumProvident 3,600 55,980
81,152
MACHINERY-FARM (0.24%)
Deere 1,900 129,276
MEDICAL INSTRUMENTS (1.46%)
Boston Scientific /1/ 5,200 214,188
Guidant 1,800 113,418
Medtronic 7,200 363,312
St. Jude Medical /1/ 1,300 99,138
790,056
MEDICAL LABORATORY & TESTING SERVICE (0.23%)
Laboratory Corp. of America Holdings /1/ 3,200 127,168
MEDICAL PRODUCTS (2.32%)
Baxter International 2,800 88,620
Becton Dickinson 1,300 65,715
Johnson & Johnson 16,000 864,480
Stryker 1,200 118,716
Zimmer Holdings /1/ 1,500 119,775
1,257,306
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-BIOMEDICAL/GENE (1.22%)
$
Amgen /1/ 7,700 433,279
Biogen Idec /1/ 1,800 106,200
Genentech /1/ 600 73,680
Genzyme /1/ 1,100 47,916
661,075
MEDICAL-DRUGS (6.27%)
Abbott Laboratories 5,500 242,110
Cephalon /1/ 600 34,146
Eli Lilly 6,500 479,765
Forest Laboratories /1/ 3,700 238,576
Medimmune /1/ 1,300 31,512
Merck 11,500 540,500
Pfizer 41,400 1,480,464
Schering-Plough 3,300 55,209
Wyeth 7,900 300,753
3,403,035
MEDICAL-GENERIC DRUGS (0.07%)
Watson Pharmaceutical /1/ 1,100 39,171
MEDICAL-HMO (0.79%)
Anthem /1/ 900 79,722
UnitedHealth Group 5,700 350,436
430,158
MEDICAL-HOSPITALS (0.22%)
HCA 3,000 121,890
MEDICAL-WHOLESALE DRUG DISTRIBUTION (0.40%)
AmerisourceBergen 600 34,734
Cardinal Health 2,500 183,125
217,859
METAL-ALUMINUM (0.28%)
Alcoa 5,000 153,750
MISCELLANEOUS INVESTING (0.34%)
Duke-Weeks Realty 2,600 75,816
Simon Property Group 1,000 48,210
United Dominion Realty Trust 3,400 61,030
185,056
MONEY CENTER BANKS (2.14%)
Bank of America 8,521 685,855
JP Morgan Chase 12,600 473,760
1,159,615
MOTORCYCLE & MOTOR SCOOTER (0.18%)
Harley-Davidson 1,700 95,744
MULTI-LINE INSURANCE (3.27%)
American International Group 14,300 1,024,595
Assurant /1/ 3,200 77,952
Hartford Financial Services 2,600 158,808
Prudential Financial 4,400 193,336
Safeco 7,300 319,667
1,774,358
MULTIMEDIA (2.02%)
E.W. Scripps 400 42,220
Gannett 1,900 164,692
McGraw-Hill 900 70,974
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MULTIMEDIA (CONTINUED)
$
Meredith 400 20,376
Time Warner /1/ 24,200 407,044
Viacom 7,000 270,550
Walt Disney 5,200 119,756
1,095,612
NETWORKING PRODUCTS (1.64%)
Cisco Systems /1/ 37,700 786,799
Emulex /1/ 3,300 55,011
Juniper Networks /1/ 1,000 21,880
Lucent Technologies /1/ 7,400 24,938
888,628
NON-HAZARDOUS WASTE DISPOSAL (0.30%)
Waste Management 5,800 164,720
OIL & GAS DRILLING (0.19%)
Transocean Sedco Forex /1/ 3,800 105,526
OIL COMPANY-EXPLORATION & PRODUCTION (0.50%)
Anadarko Petroleum 1,500 80,370
Devon Energy 500 30,600
EOG Resources 700 34,475
Murphy Oil 1,800 123,300
268,745
OIL COMPANY-INTEGRATED (4.71%)
Amerada Hess 1,500 106,695
ChevronTexaco 5,600 512,400
ConocoPhillips 3,600 256,680
Exxon Mobil 36,000 1,531,800
Occidental Petroleum 700 33,040
TotalFinaElf 1,300 119,756
2,560,371
OIL FIELD MACHINERY & EQUIPMENT (0.18%)
FMC Technologies /1/ 1,700 46,325
Grant Prideco /1/ 3,200 48,800
95,125
OIL-FIELD SERVICES (0.75%)
Baker Hughes 2,600 95,368
BJ Services /1/ 600 26,700
Schlumberger 4,900 286,797
408,865
OPTICAL SUPPLIES (0.03%)
Bausch & Lomb 300 18,849
PAPER & RELATED PRODUCTS (0.60%)
Bowater 700 29,365
International Paper 2,900 116,928
MeadWestvaco 2,200 57,530
Potlatch 1,900 71,972
Weyerhaeuser 800 47,360
323,155
PHARMACY SERVICES (0.11%)
Medco Health Solutions /1/ 800 28,320
Omnicare 800 33,184
61,504
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PIPELINES (0.02%)
$
Williams 1,100 11,330
PROPERTY & CASUALTY INSURANCE (1.29%)
St. Paul 16,302 663,002
XL Capital 500 38,175
701,177
PUBLISHING-NEWSPAPERS (0.31%)
New York Times 1,700 77,877
Washington Post 100 92,000
169,877
REGIONAL BANKS (4.02%)
Bank One 10,300 508,511
Comerica 9,200 474,996
U.S. Bancorp 23,700 607,668
Wachovia 6,800 311,100
Wells Fargo 5,000 282,300
2,184,575
RETAIL-APPAREL & SHOE (0.84%)
Abercrombie & Fitch 3,200 100,640
Christopher & Banks 4,900 87,661
Ross Stores 8,800 268,400
456,701
RETAIL-AUTO PARTS (0.12%)
O'Reilly Automotive /1/ 1,500 67,335
RETAIL-BUILDING PRODUCTS (1.28%)
Home Depot 12,900 453,951
Lowe's 4,600 239,476
693,427
RETAIL-CONSUMER ELECTRONICS (0.22%)
Best Buy 2,200 119,350
RETAIL-DISCOUNT (3.74%)
Dollar Tree Stores /1/ 3,100 83,545
Family Dollar Stores 2,700 86,778
Target 14,500 628,865
TJX 2,600 63,882
Wal-Mart Stores 20,500 1,168,500
2,031,570
RETAIL-DRUG STORE (0.61%)
CVS 2,600 100,438
Walgreen 6,700 231,016
331,454
RETAIL-OFFICE SUPPLIES (0.12%)
Staples 2,500 64,400
RETAIL-PET FOOD & SUPPLIES (0.04%)
PETsMART 800 22,160
RETAIL-REGIONAL DEPARTMENT STORE (0.12%)
Kohl's /1/ 1,600 66,864
RETAIL-RESTAURANTS (0.90%)
McDonald's 7,400 201,502
Panera Bread /1/ 2,300 94,001
RARE Hospitality International /1/ 1,900 52,003
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-RESTAURANTS (CONTINUED)
$
Starbucks /1/ 2,100 81,606
Yum! Brands /1/ 1,600 62,064
491,176
SATELLITE TELECOM (0.21%)
EchoStar Communications /1/ 3,500 116,165
SCHOOLS (0.17%)
Apollo Group /1/ 1,000 90,880
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (0.72%)
Analog Devices 3,000 127,800
Linear Technology 2,600 92,638
Maxim Integrated Products 3,700 170,163
390,601
SEMICONDUCTOR EQUIPMENT (0.39%)
Applied Materials /1/ 4,900 89,327
Kla-Tencor /1/ 1,000 41,670
Novellus Systems /1/ 2,800 81,088
212,085
STEEL PRODUCERS (0.79%)
International Steel Group /1/ 700 20,335
Nucor 6,400 380,160
Steel Dynamics /1/ 1,100 26,477
426,972
TELECOMMUNICATION EQUIPMENT (0.60%)
Andrew /1/ 900 15,255
Comverse Technology /1/ 1,100 17,996
Nortel Networks /1/ 5,100 19,074
Qualcomm 4,400 274,824
327,149
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.19%)
Corning /1/ 8,400 92,652
JDS Uniphase /1/ 4,100 12,464
105,116
TELECOMMUNICATION SERVICES (0.06%)
Avaya /1/ 2,200 30,096
TELEPHONE-INTEGRATED (1.95%)
ALLTEL 1,600 80,544
NTL /1/ 1,600 90,832
Qwest Communications International /1/ 17,400 69,948
Sprint 15,600 279,084
Verizon Communications 14,300 539,682
1,060,090
THERAPEUTICS (0.10%)
Gilead Sciences /1/ 900 54,747
TOBACCO (1.41%)
Altria Group 13,800 764,244
TOOLS-HAND HELD (0.09%)
Black & Decker 300 17,355
Stanley Works 800 34,008
51,363
Shares
Held Value
- --------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TOYS (0.15%)
$
Hasbro 4,200 79,338
TRANSPORT-RAIL (0.41%)
Burlington Northern Santa Fe 2,500 81,750
CSX 2,100 64,596
Union Pacific 1,300 76,609
222,955
TRANSPORT-SERVICES (1.05%)
Expeditors International of Washington 400 16,076
United Parcel Service 7,900 554,185
570,261
WEB PORTALS (0.68%)
Yahoo /1/ 7,300 368,358
WIRELESS EQUIPMENT (0.44%)
Motorola 13,100 239,075
TOTAL COMMON STOCKS 53,686,034
Shares
Held Value
- --------------------------------------------------------------------------------------
PREFERRED STOCKS (0.24%)
MULTIMEDIA (0.24%)
News 3,800 128,250
TOTAL PREFERRED STOCKS 128,250
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
APRIL 30, 2004 (UNAUDITED)
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Principal
Amount Value
- -------------------------------------------------------------------------------
TREASURY BONDS (0.09%)
U.S. Treasury Strip /2/ 10,000,000
$ $
0.00%; 06/24/04 50,000 49,937
TOTAL TREASURY BONDS 49,937
-----------
TOTAL PORTFOLIO INVESTMENTS (99.18%) 53,864,221
CASH, RECEIVABLES AND
OTHER ASSETS, NET OF
LIABILITIES (0.82%) 445,461
TOTAL NET ASSETS (100.00%) $54,309,682
-------------
Unrealized
Contract Opening Current Gain (Loss)
Type Commitment Market Value Market Value
- ---------------------------------------------------------------------
FUTURES CONTRACTS
6 S&P 500 eMini Buy $332,800 $331,830 $(970)
June, 2004
Futures
/1 /Non-income producing security.
/2 /Security or a portion of the security was pledged to cover margin
requirements for futures contracts.
See accompanying notes.
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS LARGECAP VALUE FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (97.25%)
ADVERTISING AGENCIES (0.57%)
$
Interpublic Group /1/ 20,900 327,921
AEROSPACE & DEFENSE (0.54%)
Boeing 7,300 311,637
AEROSPACE & DEFENSE EQUIPMENT (0.77%)
General Dynamics 1,700 159,154
Goodrich 9,775 281,422
440,576
AGRICULTURAL OPERATIONS (0.15%)
Monsanto 2,400 83,016
APPAREL MANUFACTURERS (1.28%)
Jones Apparel Group 9,050 331,230
Liz Claiborne 3,200 112,320
VF 6,200 286,192
729,742
APPLIANCES (0.42%)
Whirlpool 3,675 240,749
ATHLETIC FOOTWEAR (0.32%)
Reebok International 5,100 185,538
AUTO-CARS & LIGHT TRUCKS (0.75%)
General Motors 9,100 431,522
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.68%)
Paccar 6,900 389,574
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (2.58%)
American Axle & Manufacturing
Holdings /1/ 4,600 176,962
Autoliv 7,500 318,975
BorgWarner 2,400 196,656
Dana 9,900 199,584
Delphi Automotive Systems 5,700 58,140
Lear 3,700 224,294
Magna International 3,800 299,820
1,474,431
BEVERAGES-NON-ALCOHOLIC (0.16%)
Pepsico 1,700 92,633
BUILDING & CONSTRUCTION PRODUCTS-MISCELLANEOUS (0.52%)
Vulcan Materials 6,400 295,936
BUILDING PRODUCTS-CEMENT & AGGREGATE (0.27%)
Martin Marietta Materials 3,600 155,700
BUILDING-RESIDENTIAL & COMMERCIAL (0.47%)
DR Horton 1,800 51,840
Pulte 4,400 216,348
268,188
CABLE TV (1.20%)
Comcast /1/ 22,711 683,601
CHEMICALS-DIVERSIFIED (0.85%)
Dow Chemical 4,700 186,543
E. I. Du Pont de Nemours 2,500 107,375
PPG Industries 3,200 189,792
483,710
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
COMMERCIAL BANKS (0.57%)
$
Regions Financial 6,150 213,467
SouthTrust 3,600 111,888
325,355
COMPUTER SERVICES (0.40%)
Electronic Data Systems 12,500 228,625
COMPUTERS (2.12%)
Hewlett-Packard 45,300 892,410
International Business Machines 3,650 321,820
1,214,230
COMPUTERS-MEMORY DEVICES (0.05%)
Quantum /1/ 8,800 27,544
CONSUMER PRODUCTS-MISCELLANEOUS (0.19%)
Fortune Brands 1,400 106,750
CONTAINERS-METAL & GLASS (0.05%)
Owens-Illinois /1/ 2,000 27,920
CONTAINERS-PAPER & PLASTIC (0.19%)
Smurfit-Stone Container /1/ 6,200 106,578
COSMETICS & TOILETRIES (0.31%)
Procter & Gamble 1,700 179,775
DISTRIBUTION-WHOLESALE (0.38%)
Ingram Micro /1/ 8,700 103,965
Tech Data /1/ 3,300 112,200
216,165
DIVERSIFIED FINANCIAL SERVICES (4.63%)
Citigroup 55,100 2,649,759
DIVERSIFIED MANUFACTURING OPERATIONS (3.11%)
Cooper Industries 3,800 208,658
Eaton 6,200 368,156
Honeywell International 16,200 560,196
Textron 6,300 347,634
Tyco International 10,600 290,970
1,775,614
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (0.31%)
Cendant 7,400 175,232
ELECTRIC-INTEGRATED (4.36%)
Alliant Energy 9,300 231,198
American Electric Power 12,750 388,110
CMS Energy /1/ 10,400 86,424
Constellation Energy Group 6,100 234,728
Edison International 2,600 60,840
Entergy 6,100 333,060
FirstEnergy 9,900 387,090
Northeast Utilities 10,900 200,015
PG&E /1/ 3,900 107,328
PPL 5,300 227,105
XCEL Energy 14,000 234,220
2,490,118
ELECTRONIC COMPONENTS-MISCELLANEOUS (1.10%)
Celestica /1/ 3,300 58,014
Flextronics International /1/ 18,200 293,020
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC COMPONENTS-MISCELLANEOUS (CONTINUED)
$
Solectron /1/ 40,200 196,980
Vishay Intertechnology /1/ 4,800 83,520
631,534
ELECTRONIC PARTS DISTRIBUTION (0.39%)
Arrow Electronics /1/ 2,000 50,560
Avnet /1/ 8,000 173,120
223,680
FINANCE-CREDIT CARD (0.10%)
Capital One Financial 900 58,977
FINANCE-INVESTMENT BANKER & BROKER (2.72%)
Bear Stearns 2,800 224,392
Lehman Brothers Holdings 6,250 458,750
Merrill Lynch 9,500 515,185
Morgan Stanley 6,900 354,591
1,552,918
FINANCE-MORTGAGE LOAN/BANKER (2.31%)
Countrywide Credit Industries 6,999 415,041
Federal Home Loan Mortgage 10,700 624,880
Federal National Mortgage
Association 4,125 283,470
1,323,391
FINANCIAL GUARANTEE INSURANCE (1.13%)
MBIA 5,100 300,339
MGIC Investment 4,700 346,014
646,353
FOOD-FLOUR & GRAIN (0.36%)
Archer Daniels Midland 11,625 204,135
FOOD-MISCELLANEOUS/DIVERSIFIED (0.12%)
Unilever 1,000 65,930
FOOD-RETAIL (0.88%)
Kroger /1/ 16,200 283,500
Safeway /1/ 9,600 220,320
503,820
FOOD-WHOLESALE & DISTRIBUTION (0.16%)
Supervalu 3,000 92,370
GAS-DISTRIBUTION (0.49%)
Sempra Energy 8,900 282,575
LIFE & HEALTH INSURANCE (1.37%)
Jefferson-Pilot 6,200 307,458
Manulife Financial 11,260 414,043
Torchmark 1,225 63,749
785,250
MACHINERY-CONSTRUCTION & MINING (0.43%)
Caterpillar 3,200 248,736
MACHINERY-GENERAL INDUSTRY (0.49%)
Ingersoll-Rand 4,300 277,565
MEDICAL INSTRUMENTS (0.51%)
Guidant 4,600 289,846
MEDICAL-DRUGS (2.58%)
Bristol-Myers Squibb 10,200 256,020
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-DRUGS (CONTINUED)
$
GlaxoSmithKline 7,000 294,000
Merck 13,950 655,650
Pfizer 7,600 271,776
1,477,446
MEDICAL-HMO (1.24%)
Aetna 2,800 231,700
Humana /1/ 11,000 179,190
Oxford Health Plans 5,500 299,420
710,310
METAL PROCESSORS & FABRICATION (0.21%)
Worthington Industries 6,700 120,935
METAL-ALUMINUM (1.35%)
Alcan 5,600 225,288
Alcoa 17,800 547,350
772,638
MONEY CENTER BANKS (5.52%)
Bank of America 25,933 2,087,347
JP Morgan Chase 28,500 1,071,600
3,158,947
MULTI-LINE INSURANCE (3.19%)
Allstate 12,500 573,750
American International Group 5,889 421,947
Hartford Financial Services 7,400 451,992
MetLife 10,850 374,325
1,822,014
MULTIMEDIA (1.12%)
Time Warner /1/ 24,500 412,090
Viacom 2,500 96,625
Walt Disney 5,600 128,968
637,683
OIL COMPANY-INTEGRATED (10.05%)
BP Amoco 5,300 280,370
ChevronTexaco 14,628 1,338,462
ConocoPhillips 10,897 776,956
Exxon Mobil 57,600 2,450,880
Marathon Oil 12,300 412,788
Occidental Petroleum 10,300 486,160
5,745,616
OIL REFINING & MARKETING (1.23%)
Ashland 5,900 282,610
Valero Energy 6,600 420,816
703,426
PAPER & RELATED PRODUCTS (1.31%)
Georgia-Pacific 12,550 440,505
Temple-Inland 5,000 308,850
749,355
PIPELINES (0.57%)
El Paso 39,300 275,493
Williams 4,800 49,440
324,933
POWER CONVERTER & SUPPLY EQUIPMENT (0.23%)
Hubbell 2,900 130,326
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
PRINTING-COMMERCIAL (0.60%)
$
R.R. Donnelley & Sons 11,700 344,214
PROPERTY & CASUALTY INSURANCE (2.19%)
ACE 2,800 122,752
Chubb 5,550 382,950
St. Paul 14,036 570,844
XL Capital 2,300 175,605
1,252,151
REGIONAL BANKS (7.48%)
Bank One 8,300 409,771
Comerica 6,500 335,595
Huntington Bancshares 7,800 166,920
KeyCorp 11,550 343,035
National City 13,850 480,180
PNC Financial Services Group 7,300 387,630
SunTrust Banks 6,700 455,935
U.S. Bancorp 20,597 528,107
Wachovia 17,300 791,475
Wells Fargo 6,650 375,459
4,274,107
REINSURANCE (0.18%)
RenaissanceRe Holdings 2,000 105,380
RETAIL-APPAREL & SHOE (0.04%)
Foot Locker 900 21,600
RETAIL-AUTOMOBILE (0.34%)
AutoNation /1/ 11,300 192,326
RETAIL-MAJOR DEPARTMENT STORE (1.32%)
May Department Stores 12,200 375,760
Sears Roebuck 9,500 380,475
756,235
RETAIL-OFFICE SUPPLIES (0.60%)
Office Depot /1/ 19,600 343,196
RETAIL-REGIONAL DEPARTMENT STORE (0.59%)
Federated Department Stores 6,900 338,100
RETAIL-RESTAURANTS (1.11%)
McDonald's 23,400 637,182
RUBBER-TIRES (0.24%)
Cooper Tire & Rubber 6,300 134,757
SAVINGS & LOANS-THRIFTS (2.12%)
Astoria Financial 6,500 223,730
Golden West Financial 3,200 336,352
Washington Mutual 16,487 649,423
1,209,505
STEEL PRODUCERS (0.46%)
United States Steel 9,100 260,533
TELECOMMUNICATION EQUIPMENT (0.92%)
Nortel Networks /1/ 72,100 269,654
Tellabs /1/ 29,100 254,043
523,697
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.86%)
$
Corning /1/ 44,800 494,144
TELEPHONE-INTEGRATED (4.24%)
BellSouth 13,400 345,854
Qwest Communications International
/1/ 40,400 162,408
SBC Communications 21,800 542,820
Sprint 43,500 778,215
Verizon Communications 15,800 596,292
2,425,589
TEXTILE-HOME FURNISHINGS (0.34%)
Mohawk Industries /1/ 2,500 192,850
TOBACCO (2.78%)
Altria Group 22,050 1,221,129
UST 9,900 368,379
1,589,508
TOOLS-HAND HELD (0.16%)
Stanley Works 2,200 93,522
TRANSPORT-RAIL (1.32%)
Burlington Northern Santa Fe 9,050 295,935
CSX 6,100 187,636
Norfolk Southern 11,300 269,166
752,737
TOTAL COMMON STOCKS 55,600,181
-----------
TOTAL PORTFOLIO INVESTMENTS (97.25%) 55,600,181
CASH, RECEIVABLES AND
OTHER ASSETS, NET OF
LIABILITIES (2.75%) 1,572,623
TOTAL NET ASSETS (100.00%) $57,172,804
-------------
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS MIDCAP GROWTH FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (96.53%)
ADVERTISING AGENCIES (0.56%)
$
Interpublic Group /1/ 11,340 177,925
ADVERTISING SALES (0.35%)
Lamar Advertising /1/ 2,730 112,094
APPAREL MANUFACTURERS (1.28%)
Coach /1/ 9,600 408,960
APPLICATIONS SOFTWARE (1.92%)
Citrix Systems /1/ 18,220 347,091
Red Hat /1/ 11,630 264,117
611,208
AUDIO & VIDEO PRODUCTS (0.88%)
Polycom /1/ 14,740 281,239
AUTO-MEDIUM & HEAVY DUTY TRUCKS (0.59%)
Navistar International /1/ 4,190 189,179
BROADCASTING SERVICES & PROGRAMMING (0.63%)
Citadel Broadcasting /1/ 11,620 201,607
BUILDING PRODUCTS-AIR & HEATING (0.88%)
American Standard /1/ 2,660 279,805
CASINO HOTELS (1.50%)
MGM Mirage /1/ 4,950 226,760
Station Casinos 5,540 249,743
476,503
CASINO SERVICES (1.29%)
International Game Technology 10,890 410,989
CELLULAR TELECOMMUNICATIONS (1.50%)
NII Holdings /1/ 3,680 128,800
Vimpel Communications /1/ 1,430 128,357
Western Wireless /1/ 10,640 221,525
478,682
COAL (0.54%)
Peabody Energy 3,640 170,680
COMMERCIAL BANKS (0.53%)
UCBH Holdings 4,590 169,922
COMMERCIAL SERVICES (0.97%)
Alliance Data Systems /1/ 8,870 308,410
COMPUTERS (0.49%)
Research In Motion /1/ 1,800 156,168
COMPUTERS-PERIPHERAL EQUIPMENT (1.15%)
Lexmark International /1/ 4,040 365,458
CONSUMER PRODUCTS-MISCELLANEOUS (0.52%)
Clorox 3,200 165,696
CONTAINERS-METAL & GLASS (0.31%)
Ball 1,500 99,000
DATA PROCESSING & MANAGEMENT (1.00%)
Fiserv /1/ 5,470 199,983
Global Payments 2,460 118,031
318,014
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
DENTAL SUPPLIES & EQUIPMENT (0.63%)
$
Patterson Dental /1/ 2,700 198,990
DIAGNOSTIC EQUIPMENT (1.00%)
Gen-Probe /1/ 9,540 318,064
DISPOSABLE MEDICAL PRODUCTS (1.22%)
C.R. Bard 3,660 388,948
DISTRIBUTION-WHOLESALE (1.31%)
CDW 6,660 416,183
DIVERSIFIED MANUFACTURING OPERATIONS (1.40%)
Eaton 3,060 181,703
Pentair 4,430 263,983
445,686
DIVERSIFIED OPERATORS-COMMERCIAL SERVICES (0.53%)
Aramark 5,850 167,310
DRUG DELIVERY SYSTEMS (0.62%)
Elan /1/ 9,130 197,208
E-COMMERCE-SERVICES (0.91%)
Monster Worldwide /1/ 11,320 289,905
ELECTRICAL COMPONENTS & EQUIPMENT (0.41%)
Power-One /1/ 15,070 129,602
ELECTRONIC COMPONENTS-MISCELLANEOUS (1.83%)
Sanmina /1/ 31,900 319,638
Vishay Intertechnology /1/ 15,070 262,218
581,856
ELECTRONIC COMPONENTS-SEMICONDUCTOR (5.65%)
Broadcom /1/ 11,260 425,178
Microchip Technology 8,700 243,774
National Semiconductor /1/ 7,380 301,030
Nvidia /1/ 12,640 259,626
PMC - Sierra /1/ 24,000 291,600
Silicon Laboratories /1/ 5,870 276,770
1,797,978
ELECTRONIC MEASUREMENT INSTRUMENTS (0.50%)
Tektronix 5,330 157,768
ENTERPRISE SOFTWARE & SERVICE (0.00%)
MicroStrategy /1/ 32 7
ENTERTAINMENT SOFTWARE (1.09%)
Electronic Arts /1/ 6,830 345,735
ENVIRONMENTAL CONSULTING & ENGINEERING (0.22%)
Tetra Tech /1/ 4,300 71,423
FIDUCIARY BANKS (1.49%)
Investors Financial Services 8,140 316,402
Northern Trust 3,710 156,859
473,261
FINANCE-COMMERCIAL (0.49%)
CapitalSource /1/ 7,360 155,002
FINANCE-INVESTMENT BANKER & BROKER (1.38%)
Knight Trading Group /1/ 11,470 133,281
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
FINANCE-INVESTMENT BANKER & BROKER (CONTINUED)
$
Legg Mason 3,340 307,481
440,762
FINANCIAL GUARANTEE INSURANCE (0.51%)
MGIC Investment 2,190 161,228
FOOD-MISCELLANEOUS/DIVERSIFIED (0.71%)
McCormick 6,660 227,506
FOOD-RETAIL (0.68%)
Whole Foods Market 2,710 216,773
HEALTH CARE COST CONTAINMENT (1.06%)
Caremark Rx /1/ 9,980 337,823
HOTELS & MOTELS (1.04%)
Starwood Hotels & Resorts Worldwide 8,280 329,461
HUMAN RESOURCES (1.54%)
Manpower 7,540 353,626
MPS Group /1/ 12,560 137,406
491,032
INSTRUMENTS-SCIENTIFIC (1.79%)
Fisher Scientific International /1/ 7,030 411,606
PerkinElmer 8,170 157,273
568,879
INTERNET BROKERS (1.10%)
Ameritrade Holding /1/ 28,510 348,962
INTERNET CONTENT-INFORMATION & NEWS (1.42%)
CNET Networks /1/ 29,920 254,918
SINA /1/ 6,920 197,220
452,138
INTERNET SECURITY (2.85%)
CheckFree /1/ 8,270 248,431
Symantec /1/ 10,800 486,540
VeriSign /1/ 10,570 170,494
905,465
INVESTMENT MANAGEMENT & ADVISORY SERVICES (1.75%)
Affiliated Managers Group /1/ 4,965 241,796
T. Rowe Price Group 6,140 314,859
556,655
LASERS-SYSTEMS & COMPONENTS (0.70%)
Cymer /1/ 6,990 223,540
LEISURE & RECREATION PRODUCTS (0.78%)
Brunswick 6,050 248,715
LOTTERY SERVICES (0.61%)
GTECH Holdings 3,190 194,335
MACHINERY-PRINT TRADE (0.78%)
Zebra Technologies /1/ 3,370 246,987
MEDICAL LABORATORY & TESTING SERVICE (0.54%)
Laboratory Corp. of America
Holdings /1/ 4,290 170,485
MEDICAL PRODUCTS (5.80%)
Henry Schein /1/ 5,140 362,216
INAMED /1/ 5,730 337,153
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL PRODUCTS (CONTINUED)
$
Varian Medical Systems /1/ 3,860 331,342
Zimmer Holdings /1/ 10,200 814,470
1,845,181
MEDICAL-BIOMEDICAL/GENE (2.47%)
Biogen Idec /1/ 9,090 536,310
Invitrogen /1/ 3,460 249,916
786,226
MEDICAL-DRUGS (1.17%)
Endo Pharmaceuticals Holdings /1/ 3,900 93,093
IVAX /1/ 7,200 153,360
OSI Pharmaceuticals /1/ 1,690 124,705
371,158
MEDICAL-GENERIC DRUGS (1.22%)
Eon Labs /1/ 2,240 147,280
Watson Pharmaceutical /1/ 6,790 241,792
389,072
MEDICAL-HMO (1.75%)
Aetna 2,790 230,872
Pacificare Health Systems /1/ 9,080 324,701
555,573
MEDICAL-NURSING HOMES (0.53%)
Manor Care 5,190 168,364
METAL-COPPER (0.51%)
Phelps Dodge /1/ 2,450 161,284
MULTI-LEVEL DIRECT SELLING (0.71%)
Nu Skin Enterprises 9,590 226,995
NETWORKING PRODUCTS (1.37%)
Juniper Networks /1/ 19,930 436,068
OIL & GAS DRILLING (0.78%)
Nabors Industries /1/ 5,630 249,747
OIL COMPANY-EXPLORATION & PRODUCTION (1.44%)
Chesapeake Energy 12,360 169,950
XTO Energy 10,825 289,027
458,977
OIL FIELD MACHINERY & EQUIPMENT (1.05%)
Smith International /1/ 6,130 335,617
OIL REFINING & MARKETING (0.63%)
Ashland 4,170 199,743
PHARMACY SERVICES (0.70%)
Omnicare 5,400 223,992
PIPELINES (0.53%)
Kinder Morgan 2,780 167,384
RADIO (0.93%)
Radio One /1/ 6,890 130,634
XM Satellite Radio Holdings /1/ 6,930 166,043
296,677
REINSURANCE (0.62%)
AXIS Capital Holdings 7,220 196,745
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-APPAREL & SHOE (2.05%)
$
Chico's FAS /1/ 7,770 316,472
Foot Locker 8,510 204,240
Pacific Sunwear of California /1/ 6,070 130,323
651,035
RETAIL-AUTO PARTS (0.66%)
PEP Boys-Manny, Moe & Jack 7,680 210,970
RETAIL-HOME FURNISHINGS (0.09%)
Cost Plus /1/ 810 29,322
RETAIL-JEWELRY (0.83%)
Tiffany 6,800 265,200
RETAIL-MAIL ORDER (1.06%)
Williams-Sonoma /1/ 10,390 337,467
RETAIL-RESTAURANTS (2.29%)
Cheesecake Factory /1/ 5,080 215,138
Ruby Tuesday 6,010 179,819
Starbucks /1/ 8,610 334,585
729,542
RETAIL-SPORTING GOODS (0.64%)
Sports Authority /1/ 5,330 204,352
SCHOOLS (1.05%)
Education Management /1/ 9,420 334,033
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (1.06%)
Integrated Device Technology /1/ 16,340 219,773
Marvell Technology Group /1/ 3,040 117,739
337,512
SEMICONDUCTOR EQUIPMENT (1.62%)
FormFactor /1/ 11,780 207,210
Lam Research /1/ 13,890 307,525
514,735
STEEL PRODUCERS (0.39%)
United States Steel 4,350 124,541
TELECOMMUNICATION EQUIPMENT (1.17%)
Comverse Technology /1/ 22,670 370,881
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (1.41%)
Corning /1/ 40,670 448,590
TELECOMMUNICATION SERVICES (0.57%)
Avaya /1/ 13,170 180,166
TELEVISION (0.79%)
Univision Communications /1/ 7,460 252,521
THERAPEUTICS (0.86%)
Neurocrine Biosciences /1/ 4,160 273,021
TOYS (1.13%)
Marvel Enterprises /1/ 18,920 359,291
TRANSPORT-SERVICES (0.70%)
Expeditors International of
Washington 5,560 223,456
Shares
Held Value
- -------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
VITAMINS & NUTRITION PRODUCTS (0.52%)
$
NBTY /1/ 4,440 164,990
TOTAL COMMON STOCKS 30,717,639
-----------
TOTAL PORTFOLIO INVESTMENTS (96.53%) 30,717,639
CASH, RECEIVABLES AND
OTHER ASSETS, NET OF
LIABILITIES (3.47%) 1,104,669
TOTAL NET ASSETS (100.00%) $31,822,308
-------------
/1/ Non-income producing security.
135
SCHEDULE OF INVESTMENTS
PRINCIPAL PARTNERS SMALLCAP GROWTH FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (97.55%)
AIRLINES (0.64%)
$
Pinnacle Airlines /1/ 7,900 112,417
AUTO/TRUCK PARTS & EQUIPMENT-ORIGINAL (1.46%)
American Axle & Manufacturing Holdings /1/ 6,700 257,749
BEVERAGES-NON-ALCOHOLIC (1.35%)
Cott /1/ 7,800 236,808
BEVERAGES-WINE & SPIRITS (1.07%)
Constellation Brands /1/ 5,700 188,841
BUILDING & CONSTRUCTION-MISCELLANEOUS (1.35%)
Dycom Industries /1/ 10,100 238,158
BUILDING-RESIDENTIAL & COMMERCIAL (1.75%)
Hovnanian Enterprises /1/ 4,800 172,656
NVR /1/ 300 135,300
307,956
CHEMICALS-SPECIALTY (0.91%)
Albemarle 5,500 160,875
CIRCUIT BOARDS (2.53%)
Benchmark Electronics /1/ 10,450 282,464
TTM Technologies /1/ 14,700 163,317
445,781
COMMERCIAL BANKS (2.11%)
UCBH Holdings 10,020 370,940
COMPUTER SERVICES (5.24%)
CACI International /1/ 7,990 363,545
Cognizant Technology Solutions /1/ 10,030 433,898
FactSet Research Systems 3,140 124,846
922,289
COMPUTERS-INTEGRATED SYSTEMS (0.79%)
RadiSys /1/ 7,400 138,158
COMPUTERS-MEMORY DEVICES (1.70%)
Advanced Digital Information /1/ 18,900 199,584
Dot Hill Systems /1/ 13,300 99,750
299,334
DATA PROCESSING & MANAGEMENT (1.77%)
Fair, Isaac 9,250 311,910
DENTAL SUPPLIES & EQUIPMENT (1.84%)
Patterson Dental /1/ 4,400 324,280
DISPOSABLE MEDICAL PRODUCTS (0.58%)
Merit Medical Systems /1/ 6,467 101,597
DIVERSIFIED MANUFACTURING OPERATIONS (1.15%)
ESCO Technologies /1/ 4,200 202,860
DRUG DELIVERY SYSTEMS (0.65%)
Penwest Pharmaceuticals /1/ 7,200 114,480
E-MARKETING-INFORMATION (1.39%)
Digital River /1/ 9,500 244,625
ELECTRONIC COMPONENTS-SEMICONDUCTOR (1.64%)
Cree /1/ 4,000 74,200
Microsemi /1/ 17,200 186,964
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
ELECTRONIC COMPONENTS-SEMICONDUCTOR (CONTINUED)
$
SiRF Technology Holdings /1/ 1,100 17,600
Staktek Holdings /1/ 1,000 9,000
287,764
ELECTRONIC DESIGN AUTOMATION (1.44%)
Magma Design Automation /1/ 10,400 193,856
Verisity /1/ 7,900 60,040
253,896
ELECTRONICS-MILITARY (1.50%)
Engineered Support Systems 5,430 264,061
ENGINEERING-RESEARCH & DEVELOPMENT SERVICES (0.86%)
EMCOR Group /1/ 3,700 151,330
ENTERTAINMENT SOFTWARE (0.66%)
THQ /1/ 6,280 116,431
ENVIRONMENTAL CONSULTING & ENGINEERING (0.77%)
Tetra Tech /1/ 8,200 136,202
FIDUCIARY BANKS (1.90%)
Investors Financial Services 8,600 334,282
FOOD-WHOLESALE & DISTRIBUTION (1.00%)
Performance Food Group /1/ 5,000 175,650
HOSPITAL BEDS & EQUIPMENT (0.28%)
Kinetic Concepts /1/ 1,000 48,400
HOTELS & MOTELS (0.45%)
Highland Hospitality /1/ 7,400 78,588
INDUSTRIAL AUTOMATION & ROBOTS (1.61%)
Cognex 8,900 282,842
INSTRUMENTS-SCIENTIFIC (1.20%)
Fisher Scientific International /1/ 3,600 210,780
INSURANCE BROKERS (0.52%)
Hilb, Rogal & Hamilton 2,530 90,701
INTERNET INFRASTRUCTURE EQUIPMENT (0.71%)
Avocent /1/ 3,900 125,151
INTERNET SECURITY (1.56%)
RSA Security /1/ 10,800 173,016
Secure Computing /1/ 10,600 101,336
274,352
MACHINERY-CONSTRUCTION & MINING (0.74%)
JLG Industries 8,800 130,152
MEDICAL INSTRUMENTS (1.12%)
Advanced Neuromodulation Systems /1/ 7,200 196,200
MEDICAL PRODUCTS (2.04%)
INAMED /1/ 6,100 358,924
MEDICAL-BIOMEDICAL/GENE (1.28%)
Affymetrix /1/ 2,600 79,456
Telik /1/ 6,200 145,514
224,970
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL-DRUGS (1.25%)
$
First Horizon Pharmaceutical /1/ 11,400 176,814
POZEN /1/ 3,700 43,808
220,622
MEDICAL-GENERIC DRUGS (0.86%)
Taro Pharmaceuticals Industries /1/ 3,500 151,375
MEDICAL-HOSPITALS (2.32%)
VCA Antech /1/ 10,000 408,900
MEDICAL-OUTPATIENT & HOME MEDICAL CARE (2.99%)
Odyssey HealthCare /1/ 11,250 189,112
Select Medical 17,800 337,310
526,422
MISCELLANEOUS INVESTING (3.33%)
American Financial Realty Trust 8,100 119,880
Capital Lease Funding /1/ 1,100 11,572
Government Properties Trust 2,700 29,565
Mills 4,700 190,820
Ventas 10,600 234,154
585,991
NETWORKING PRODUCTS (1.20%)
Atheros Communications /1/ 800 11,304
Foundry Networks /1/ 10,500 118,650
Ixia /1/ 9,000 80,370
210,324
OIL & GAS DRILLING (0.97%)
Patterson-UTI Energy /1/ 4,700 170,093
OIL COMPANY-EXPLORATION & PRODUCTION (3.41%)
Patina Oil & Gas 11,450 318,310
Quicksilver Resources /1/ 6,500 282,425
600,735
OIL-FIELD SERVICES (1.39%)
Tetra Technologies /1/ 10,250 245,078
PHYSICIAN PRACTICE MANAGEMENT (3.08%)
Pediatrix Medical Group /1/ 7,580 541,970
PRINTING-COMMERCIAL (1.61%)
R.R. Donnelley & Sons 9,598 282,373
PROPERTY & CASUALTY INSURANCE (0.61%)
RLI 3,100 107,725
PUBLICLY TRADED INVESTMENT FUND (1.52%)
iShares Russell 2000 Index Fund 2,400 267,216
RADIO (1.63%)
Cumulus Media /1/ 10,700 224,914
Salem Communications /1/ 2,100 62,601
287,515
RESPIRATORY PRODUCTS (0.49%)
ResMed /1/ 1,735 85,501
RETAIL-APPAREL & SHOE (3.70%)
Aeropostale /1/ 11,850 260,581
Chico's FAS /1/ 9,600 391,008
651,589
Shares
Held Value
- ------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-COMPUTER EQUIPMENT (0.96%)
$
Electronics Boutique Holdings /1/ 6,237 168,711
RETAIL-PET FOOD & SUPPLIES (1.42%)
PETCO Animal Supplies /1/ 8,500 249,560
RETAIL-RESTAURANTS (2.69%)
Panera Bread /1/ 4,750 194,133
Ruby Tuesday 9,300 278,256
472,389
SAVINGS & LOANS-THRIFTS (1.25%)
BankUnited Financial /1/ 5,700 150,651
Harbor Florida Bancshares 2,500 69,300
219,951
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (2.29%)
Exar /1/ 9,150 139,629
Power Integrations /1/ 7,100 174,873
Standard Microsystems /1/ 3,700 88,208
402,710
SEMICONDUCTOR EQUIPMENT (1.56%)
August Technology /1/ 6,800 89,624
Rudolph Technologies /1/ 5,700 91,599
Ultratech /1/ 5,800 93,438
274,661
SEMICONDUCTORS (0.73%)
Artisan Components /1/ 5,500 128,700
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.33%)
C-COR.net /1/ 6,300 57,204
THERAPEUTICS (4.90%)
Amylin Pharmaceuticals /1/ 3,700 82,880
CV Therapeutics /1/ 3,200 46,112
Isis Pharmaceuticals /1/ 10,200 74,154
Medicines /1/ 5,000 163,550
Neurocrine Biosciences /1/ 3,561 233,708
NPS Pharmaceuticals /1/ 5,000 125,250
Vicuron Pharmaceuticals /1/ 6,000 136,860
862,514
TOYS (0.56%)
LeapFrog Enterprises /1/ 4,600 98,946
TRANSPORT-SERVICES (0.94%)
UTI Worldwide 3,600 164,916
TOTAL COMMON STOCKS 17,163,425
-----------
TOTAL PORTFOLIO INVESTMENTS (97.55%) 17,163,425
CASH, RECEIVABLES AND OTHER ASSETS, NET OF LIABILITIES
(2.45%) 430,608
TOTAL NET ASSETS (100.00%) $17,594,033
--------------
/1/ Non-income producing security.
137
SCHEDULE OF INVESTMENTS
PRINCIPAL REAL ESTATE SECURITIES FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ----------------------------------------------------------------------------------------------------
COMMON STOCKS (96.82%)
APARTMENT REITS (11.71%)
$
Archstone-Smith Trust 25,600 702,208
AvalonBay Communities 27,200 1,349,936
Equity Residential Properties Trust 81,527 2,238,732
Essex Property Trust 11,700 713,115
Home Properties of New York 9,883 369,031
Mid-America Apartment Communities 15,100 486,975
United Dominion Realty Trust 54,600 980,070
6,840,067
DIVERSIFIED REITS (11.22%)
Brookfield Properties 89,000 2,474,200
Capital Automotive 49,340 1,387,934
Catellus Development 12,552 270,496
Entertainment Properties Trust 14,514 485,638
Keystone Property Trust 5,485 111,565
Vornado Realty Trust 36,100 1,821,245
6,551,078
FACTORY OUTLET REITS (4.20%)
Chelsea Property Group 48,100 2,453,100
HEALTHCARE REITS (5.62%)
Health Care 32,800 1,047,632
Ventas 101,276 2,237,187
3,284,819
HOTEL REITS (4.65%)
Highland Hospitality /1/ 33,891 359,922
Hospitality Properties Trust 1,258 49,163
LaSalle Hotel Properties 38,596 849,112
Starwood Hotels & Resorts Worldwide 36,600 1,456,314
2,714,511
MALL REITS (20.08%)
CBL & Associates Properties 40,890 2,054,722
General Growth Properties 130,400 3,535,144
Macerich 27,300 1,143,051
Mills 24,642 1,000,465
Simon Property Group 65,800 3,172,218
Tanger Factory Outlet Centers 4,024 153,717
Taubman Centers 34,295 668,753
11,728,070
OFFICE & INDUSTRIAL REITS (20.87%)
AMB Property 32,809 994,113
Boston Properties 69,100 3,247,700
CenterPoint Properties Trust 28,318 2,041,728
Corporate Office Properties Trust 45,824 932,518
Equity Office Properties Trust 28,001 704,785
Prologis Trust 105,650 3,108,223
PS Business Parks 6,542 248,269
SL Green Realty 22,438 915,470
12,192,806
SELF STORAGE REITS (2.77%)
Public Storage 38,700 1,617,273
SHOPPING CENTER REITS (15.70%)
Acadia Realty Trust 34,303 430,846
Developers Diversified Realty 73,419 2,404,472
Federal Realty Investment Trust 6,814 252,663
Shares
Held Value
- ----------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
SHOPPING CENTER REITS (CONTINUED)
$
Kimco Realty 67,700 2,893,498
Pan Pacific Retail Properties 38,770 1,703,166
Weingarten Realty Investors 51,300 1,483,083
9,167,728
TOTAL COMMON STOCKS 56,549,452
Principal
Amount Value
- ----------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (3.40%)
FINANCE-INVESTMENT BANKER & BROKER (3.40%)
Investment in Joint Trading Account; Citigroup
$ $
1.02%; 05/03/04 1,983,975 1,983,975
TOTAL COMMERCIAL PAPER 1,983,975
-----------
TOTAL PORTFOLIO INVESTMENTS (100.22%) 58,533,427
LIABILITIES, NET OF CASH, RECEIVABLES AND OTHER
ASSETS (-0.22%) (130,381)
TOTAL NET ASSETS (100.00%) $58,403,046
--------------
/1 /Non-income producing security.
138
See accompanying notes.
SCHEDULE OF INVESTMENTS
PRINCIPAL SMALLCAP FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Shares
Held Value
- ------------------------------------------------------------------------------------------------
COMMON STOCKS (95.02%)
AEROSPACE & DEFENSE EQUIPMENT (0.21%)
$
Moog /1/ 6,560 216,480
APPAREL MANUFACTURERS (0.71%)
Kellwood 18,601 733,809
BUILDING PRODUCTS-WOOD (0.19%)
Universal Forest Products 7,027 190,361
CHEMICALS-SPECIALTY (2.01%)
MacDermid 38,221 1,237,596
Minerals Technologies 14,175 831,364
2,068,960
CIRCUIT BOARDS (1.11%)
Benchmark Electronics /1/ 24,759 669,236
TTM Technologies /1/ 42,181 468,631
1,137,867
COMMERCIAL BANKS (4.31%)
City Holding 15,106 462,244
Columbia Banking Systems 81,523 1,829,376
Community Bank System 28,042 570,374
Provident Bankshares 9,377 264,150
Signature Bank /1/ 13,054 307,161
South Financial Group 35,666 987,948
4,421,253
COMMERCIAL SERVICE-FINANCE (1.79%)
NCO Group /1/ 80,753 1,833,093
COMPUTER AIDED DESIGN (1.04%)
Aspen Technology /1/ /2/ 164,402 1,068,613
COMPUTER SERVICES (0.56%)
CACI International /1/ 12,648 575,484
COMPUTERS-INTEGRATED SYSTEMS (0.44%)
RadiSys /1/ 24,315 453,961
COMPUTERS-PERIPHERAL EQUIPMENT (0.99%)
Electronics for Imaging /1/ 40,167 1,019,438
CONTAINERS-METAL & GLASS (0.47%)
Silgan Holdings /1/ 11,578 487,086
DATA PROCESSING & MANAGEMENT (0.73%)
Global Payments 15,662 751,463
DENTAL SUPPLIES & EQUIPMENT (0.99%)
Sybron Dental Specialties /1/ 34,647 1,013,425
DIAGNOSTIC EQUIPMENT (0.62%)
Immunicon /2/ 84,913 636,848
DISPOSABLE MEDICAL PRODUCTS (0.63%)
Merit Medical Systems /1/ 41,310 648,980
DISTRIBUTION-WHOLESALE (3.03%)
Aviall /1/ 31,131 515,218
United Stationers /1/ 46,440 1,764,720
Watsco 28,533 831,737
3,111,675
Shares
Held Value
- ------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
E-MARKETING-INFORMATION (2.93%)
$
Digital River /1/ 30,069 774,277
Digitas /1/ 125,757 1,246,252
E.piphany /1/ 226,451 991,855
3,012,384
ELECTRIC-INTEGRATED (0.90%)
Central Vermont Public Service 45,877 924,422
ELECTRONIC COMPONENTS-MISCELLANEOUS (0.53%)
DSP Group /1/ 21,928 543,376
ELECTRONIC COMPONENTS-SEMICONDUCTOR (1.54%)
Integrated Silicon Solution /1/ 62,441 857,315
Semtech /1/ 23,246 488,631
SiRF Technology Holdings 14,792 236,672
1,582,618
ELECTRONICS-MILITARY (0.67%)
Engineered Support Systems 14,091 685,245
ENGINES-INTERNAL COMBUSTION (0.67%)
Briggs & Stratton 9,845 689,150
ENTERTAINMENT SOFTWARE (0.51%)
Activision /1/ 34,484 519,329
ENVIRONMENTAL CONSULTING & ENGINEERING (0.69%)
Tetra Tech /1/ 42,602 707,619
FILTRATION & SEPARATION PRODUCTS (1.72%)
CLARCOR 40,199 1,769,560
FOOTWEAR & RELATED APPAREL (1.27%)
Wolverine World Wide 48,695 1,308,922
GAS-DISTRIBUTION (1.61%)
Energen 23,910 988,679
Southern Union /1/ 33,882 666,120
1,654,799
HOTELS & MOTELS (1.02%)
LaSalle Hotel Properties 47,662 1,048,564
HUMAN RESOURCES (1.41%)
Heidrick & Struggles /1/ 58,230 1,445,851
INDUSTRIAL AUTOMATION & ROBOTS (0.67%)
Cognex 21,491 682,984
INSTRUMENTS-CONTROLS (0.74%)
X-Rite 56,028 755,257
INSTRUMENTS-SCIENTIFIC (0.59%)
Dionex /1/ 11,791 601,695
INTERNET SECURITY (0.92%)
RSA Security /1/ 58,904 943,642
INVESTMENT COMPANIES (1.36%)
Apollo Investment /2/ 101,365 1,393,769
MACHINERY-GENERAL INDUSTRY (1.02%)
Gardner Denver /1/ 39,798 1,043,504
Shares
Held Value
- ------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
MEDICAL PRODUCTS (0.89%)
$
Cooper 16,966 916,164
MEDICAL-BIOMEDICAL/GENE (1.13%)
Celera Genomics Group /1/ 29,969 353,335
Lexicon Genetics /1/ /2/ 114,168 806,026
1,159,361
MEDICAL-DRUGS (2.40%)
Bradley Pharmaceuticals /1/ 53,321 1,398,076
First Horizon Pharmaceutical /1/ /2/ 68,715 1,065,770
2,463,846
MEDICAL-HMO (2.68%)
AMERIGROUP /1/ 35,882 1,489,462
Sierra Health Services /1/ 34,064 1,265,477
2,754,939
MEDICAL-HOSPITALS (1.08%)
United Surgical Partners International /1/ 30,607 1,108,586
MEDICAL-OUTPATIENT & HOME MEDICAL CARE (1.53%)
Select Medical 82,731 1,567,752
METAL PROCESSORS & FABRICATION (0.31%)
Commercial Metals 11,980 313,876
MISCELLANEOUS INVESTING (5.73%)
Associated Estates Realty 84,751 690,721
CBL & Associates Properties 17,094 858,973
Chelsea Property Group 10,381 529,431
Entertainment Properties Trust 32,605 1,090,963
Mission West Properties 43,270 511,019
Newcastle Investment 26,297 702,656
PS Business Parks 14,857 563,823
Ventas 42,224 932,728
5,880,314
OIL COMPANY-EXPLORATION & PRODUCTION (2.32%)
Houston Exploration /1/ 23,993 1,073,447
Unit /1/ 46,332 1,308,879
2,382,326
PRIVATE CORRECTIONS (0.80%)
GEO Group /1/ 35,065 824,028
PROPERTY & CASUALTY INSURANCE (2.45%)
Arch Capital Group /1/ 18,132 728,544
Infinity Property & Casualty 43,087 1,340,006
Navigators Group /1/ 17,221 448,607
2,517,157
PUBLICLY TRADED INVESTMENT FUND (3.98%)
iShares Russell 2000 Index Fund /2/ 36,707 4,086,957
RACETRACKS (1.39%)
Penn National Gaming /1/ 48,470 1,429,380
REINSURANCE (0.69%)
Max Re Capital 32,330 711,260
RETAIL-APPAREL & SHOE (3.38%)
Aeropostale /1/ 68,520 1,506,755
bebe Stores /1/ /2/ 22,242 709,520
Shares
Held Value
- ------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
RETAIL-APPAREL & SHOE (CONTINUED)
$
Genesco /1/ /2/ 56,538 1,257,970
3,474,245
RETAIL-AUTO PARTS (1.02%)
CSK Auto /1/ 56,920 1,050,743
RETAIL-AUTOMOBILE (1.03%)
Asbury Automotive Group /1/ 65,384 1,058,567
RETAIL-BOOKSTORE (0.93%)
Borders Group 39,730 952,328
RETAIL-MUSIC STORE (0.84%)
Guitar Center /1/ 20,858 866,024
RETAIL-REGIONAL DEPARTMENT STORE (0.73%)
Dillards 44,738 752,941
RETAIL-RESTAURANTS (0.80%)
Ruby Tuesday 27,607 826,001
RETAIL-SPORTING GOODS (1.47%)
Big 5 Sporting Goods /1/ 26,617 660,634
Gander Mountain /1/ /2/ 9,736 218,573
Sports Authority /1/ 16,305 625,134
1,504,341
SAVINGS & LOANS-THRIFTS (3.14%)
Dime Community Bancshares 47,250 807,975
FirstFed Financial /1/ 12,413 501,734
Hudson River Bancorp. 39,228 706,496
Independence Community Bank 27,254 992,863
ITLA Capital /1/ 4,901 210,743
3,219,811
SEMICONDUCTOR COMPONENT-INTEGRATED CIRCUITS (0.98%)
Exar /1/ 34,259 522,792
Micrel /1/ 39,838 486,821
1,009,613
SEMICONDUCTOR EQUIPMENT (2.18%)
Mykrolis /1/ 78,411 1,140,880
Varian Semiconductor Equipment Associates
/1/ 33,845 1,101,993
2,242,873
STEEL PRODUCERS (1.40%)
Schnitzer Steel Industries 54,562 1,433,344
TELECOMMUNICATION EQUIPMENT (0.71%)
Comtech Telecommunications /1/ /2/ 44,894 726,385
TELECOMMUNICATION EQUIPMENT-FIBER OPTICS (0.42%)
Optical Communication Products /1/ 198,053 433,736
TELECOMMUNICATION SERVICES (1.60%)
Aspect Communications /1/ 52,834 625,026
MasTec /1/ 138,496 1,015,176
1,640,202
THERAPEUTICS (1.70%)
Onyx Pharmaceuticals /1/ 16,015 789,860
Tanox /1/ 55,825 951,816
1,741,676
Shares
Held Value
- ------------------------------------------------------------------------------------------------
COMMON STOCKS (CONTINUED)
TOBACCO (0.72%)
$
Universal 14,752 741,140
TRANSACTIONAL SOFTWARE (0.92%)
Transaction Systems Architects /1/ 44,523 945,223
TRANSPORT-SERVICES (0.87%)
Offshore Logistics /1/ 40,819 895,977
TRANSPORT-TRUCK (1.24%)
Heartland Express 51,833 1,272,500
WEB PORTALS (0.96%)
United Online /1/ /2/ 59,593 989,244
TOTAL COMMON STOCKS 97,574,346
Principal
Amount Value
- ------------------------------------------------------------------------------------------------
COMMERCIAL PAPER (4.57%)
FINANCE-INVESTMENT BANKER & BROKER (4.57%)
Investment in Joint Trading Account;
Citigroup
$ $
1.02%; 05/03/04 4,696,568 4,696,568
TOTAL COMMERCIAL PAPER 4,696,568
Maturity
Amount Value
- ------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (12.06%)
Goldman Sachs; 0.93%; dated 04/30/04 maturing
05/03/04 (collateralized by U.S. Treasury
Strips; $12,627,616; 02/15/06 - 08/15/26)
/3/ $12,380,946 $ 12,380,000
TOTAL REPURCHASE AGREEMENTS 12,380,000
------------
TOTAL PORTFOLIO INVESTMENTS (111.65%) 114,650,914
LIABILITIES, NET OF CASH, RECEIVABLES, AND OTHER ASSETS
(-11.65%) (11,962,695)
TOTAL NET ASSETS (100.00%) $102,688,219
---------------
/1 /Non-income producing security.
/2 /Security or a portion of the security was on loan at the end of the period.
See notes to financial statements.
/3 /Security was purchased with the cash proceeds from securities loans.
See accompanying notes.
141
SCHEDULE OF INVESTMENTS
PRINCIPAL TAX-EXEMPT BOND FUND, INC.
APRIL 30, 2004 (UNAUDITED)
Principal
Amount Value
- --------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (98.29%)
ALASKA (0.96%)
North Slope Boro, Alaska /1/
MBIA
$ $
0.00%; 06/30/10 2,220,000 1,755,953
ARIZONA (1.18%)
Arizona Agricultural
Improvement
Salt River Project
5.25%; 01/01/18 1,000,000 1,068,090
Arizona State University
FGIC
5.50%; 07/01/21 1,000,000 1,071,450
2,139,540
ARKANSAS (1.19%)
Arkansas
5.25%; 08/01/12 2,000,000 2,158,960
CALIFORNIA (3.10%)
California
5.10%; 02/01/34 1,000,000 964,200
5.13%; 02/01/25 1,000,000 976,820
5.50%; 04/01/28 2,000,000 2,041,280
California Department of Water
Resources
MBIA
5.25%; 05/01/09 1,500,000 1,653,720
5,636,020
COLORADO (1.18%)
Platte River Power Authority
5.38%; 06/01/17 2,000,000 2,149,000
CONNECTICUT (1.83%)
Connecticut
5.25%; 12/15/09 3,000,000 3,323,790
FLORIDA (10.02%)
Dade County, Florida
FGIC
5.25%; 10/01/11 1,040,000 1,130,501
Florida Municipal Power
AMBAC
5.50%; 10/01/16 2,930,000 3,199,853
Florida State Board of
Education
5.00%; 06/01/10 2,000,000 2,181,660
Orange County, Florida
AMBAC
5.50%; 10/01/32 3,000,000 3,119,010
Orange County, Florida
MBIA
5.38%; 08/01/22 3,000,000 3,166,650
Orlando Utilities Commission
5.25%; 10/01/16 3,125,000 3,346,406
Sunrise, Florida Utilities
AMBAC
5.20%; 10/01/22 2,000,000 2,101,660
18,245,740
Principal
Amount Value
- --------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
GEORGIA (1.14%)
Fulco, Georgia
St. Joseph's Hospital
$ $
5.50%; 10/01/14 2,000,000 2,069,140
ILLINOIS (6.37%)
Chicago Midway Airport
MBIA
5.50%; 01/01/11 1,500,000 1,613,715
Chicago Park District
FGIC
5.50%; 01/01/18 2,000,000 2,155,680
Illinois
FSA
5.38%; 10/01/14 2,160,000 2,381,919
Illinois
MBIA
5.25%; 04/01/08 2,000,000 2,184,540
Illinois Health Facility
Advocate Health
5.25%; 08/15/08 320,000 355,091
7.00%; 02/15/09 230,000 257,986
7.00%; 02/15/18 720,000 878,242
Illinois Health Facility
Northwestern Memorial Hospital
6.10%; 08/15/14 1,000,000 1,031,970
Will County, Illinois /1/
FSA
0.00%; 11/01/11 1,005,000 738,082
11,597,225
INDIANA (6.08%)
Indiana Bond Bank
5.38%; 02/01/17 3,000,000 3,253,650
Indiana Bond Bank
Water & Sewer
5.88%; 08/01/13 1,060,000 1,195,489
Indiana Health Facility
Clarion Health Partners
5.38%; 02/15/09 2,020,000 2,158,127
Indianapolis Public Improvement
MBIA
5.50%; 01/01/16 3,000,000 3,258,480
Warrick County, Indiana
Southern Indiana Gas &
Electric
6.00%; 05/01/23 1,190,000 1,202,424
11,068,170
IOWA (2.35%)
Ankeny, Iowa
Community School District
3.00%; 07/01/08 1,190,000 1,181,670
Chillicothe, Iowa
IES Utilities
3.60%; 11/01/23 1,100,000 1,086,943
Eddyville, Iowa
Cargill
5.63%; 12/01/13 1,000,000 1,019,040
Principal
Amount Value
- --------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
IOWA (CONTINUED)
Lansing, Iowa
Interstate Power
$ $
3.60%; 11/01/08 1,000,000 987,310
4,274,963
KENTUCKY (1.84%)
Kentucky Property & Buildings
Commission
FSA
5.38%; 02/01/18 1,000,000 1,110,940
Kentucky Turnpike Authority
AMBAC
5.50%; 07/01/12 2,000,000 2,233,040
3,343,980
MAINE (0.94%)
Maine Governmental Facilities
Authority
MBIA
5.38%; 10/01/17 1,600,000 1,718,096
MASSACHUSETTS (4.27%)
Commonwealth of Massachusetts
5.75%; 06/15/15 2,000,000 2,265,720
Massachusetts
5.25%; 01/01/08 2,000,000 2,169,660
5.50%; 03/01/12 3,000,000 3,340,950
7,776,330
MICHIGAN (3.87%)
Michigan Comprehensive
Transportation
FSA
5.25%; 05/15/22 1,715,000 1,782,177
Michigan State Building
Authority
FSA
5.00%; 10/15/10 2,000,000 2,178,080
Michigan State Trunk Line
FSA
5.25%; 10/01/21 1,000,000 1,047,040
Michigan Strategic Fund
Detroit Edison
5.45%; 09/01/29 2,000,000 2,035,880
7,043,177
MINNESOTA (1.19%)
Minnesota
5.00%; 10/01/07 2,000,000 2,172,440
MISSISSIPPI (1.23%)
Mississippi
5.50%; 09/01/10 2,000,000 2,240,760
NEVADA (1.11%)
Nevada
5.25%; 09/15/27 2,000,000 2,026,880
NEW HAMPSHIRE (1.16%)
New Hampshire Health &
Education Facilities Authority
FSA
5.50%; 08/01/27 2,000,000 2,105,600
Principal
Amount Value
- --------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
NEW YORK (8.83%)
City of New York
XLCA
$ $
6.25%; 08/01/08 750,000 818,190
6.25%; 04/15/17 1,500,000 1,661,730
Long Island Power Authority
5.25%; 06/01/12 3,000,000 3,198,510
New York State Dormitory
Authority
AMBAC
6.13%; 07/01/12 2,000,000 2,279,360
New York State Dormitory
Authority
MBIA
5.25%; 10/01/23 1,500,000 1,566,300
New York State Thruway
Authority
MBIA
5.50%; 04/01/12 3,000,000 3,344,340
Tobacco Settlement Financing
Authority
5.50%; 06/01/14 2,000,000 2,144,360
United Nations Development
5.25%; 07/01/14 1,000,000 1,051,970
16,064,760
NORTH CAROLINA (0.83%)
Haywood County, North Carolina
Champion International
5.50%; 10/01/18 1,500,000 1,515,270
OHIO (0.62%)
Summit County, Ohio
FGIC
5.50%; 12/01/13 1,000,000 1,120,630
OKLAHOMA (3.43%)
Grand River Dam Authority
FSA
5.00%; 06/01/12 3,500,000 3,788,400
Tulsa Industrial Authority
St. John Medical Center
6.25%; 02/15/06 1,280,000 1,377,344
6.25%; 02/15/06 1,000,000 1,076,050
6,241,794
PENNSYLVANIA (3.75%)
Pennsylvania
FSA
5.50%; 05/01/17 3,000,000 3,277,410
Pennsylvania
MBIA
5.25%; 02/01/11 2,000,000 2,207,500
Pennsylvania Industrial
Development Authority
AMBAC
5.50%; 07/01/21 1,250,000 1,350,387
6,835,297
RHODE ISLAND (0.62%)
Rhode Island
FGIC
5.50%; 08/01/11 1,000,000 1,121,630
Principal
Amount Value
- --------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
SOUTH CAROLINA (5.33%)
South Carolina
$ $
5.75%; 01/01/13 3,000,000 3,341,700
South Carolina Public Service
FSA
5.38%; 01/01/16 3,000,000 3,230,430
South Carolina State Public
Service Authority
AMBAC
5.00%; 01/01/18 3,000,000 3,133,140
9,705,270
TEXAS (14.53%)
Brazos River Authority
Houston Industries; AMBAC
5.13%; 05/01/19 2,000,000 2,071,120
Guadalupe-Blanco River
Authority
E.I. Dupont De Nemours
6.35%; 07/01/22 2,500,000 2,578,125
Harris County, Texas
5.50%; 08/15/20 2,000,000 2,147,440
Houston, Texas Water & Sewer
FGIC
5.38%; 12/01/27 3,000,000 3,066,630
Lower Colorado River Authority
FSA
6.00%; 05/15/13 2,500,000 2,821,125
Lower Colorado River Authority
MBIA
5.38%; 05/15/20 3,000,000 3,181,020
Red River Authority
MBIA
6.00%; 06/01/20 1,000,000 1,083,480
San Antonio, Texas
FSA
5.50%; 05/15/17 2,090,000 2,266,480
Texas State Department Of
Housing & Community Affairs
5.70%; 01/01/33 2,880,000 2,984,573
Texas Technical University
MBIA
5.50%; 08/15/12 2,000,000 2,210,560
University of Texas
5.25%; 07/01/17 1,905,000 2,032,006
26,442,559
UTAH (1.84%)
Utah
5.38%; 07/01/11 3,000,000 3,349,770
WASHINGTON (1.21%)
Washington
5.50%; 01/01/11 2,000,000 2,201,020
WEST VIRGINIA (4.26%)
Braxton County, West Virginia
Weyerhaeuser
6.13%; 04/01/26 3,000,000 3,107,010
Principal
Amount Value
- --------------------------------------------------------------------------------------
TAX-EXEMPT BONDS (CONTINUED)
WEST VIRGINIA (CONTINUED)
Marshall County, West Virginia
Ohio Power; MBIA
$ $
5.90%; 04/01/22 2,500,000 2,527,575
Pleasants County, West Virginia
Potomac Edison; MBIA
6.15%; 05/01/15 2,000,000 2,122,800
7,757,385
WISCONSIN (2.03%)
Manitowoc, Wisconsin
FGIC
5.25%; 10/01/21 2,495,000 2,627,959
Wisconsin Health & Educational
Facilities
Franciscan Skemp Medical
Center
6.13%; 11/15/15 1,000,000 1,069,810
3,697,769
TOTAL TAX-EXEMPT BONDS 178,898,918
Shares
Held Value
- --------------------------------------------------------------------------------------
OTHER (0.50%)
Municipal Fund for Temporary
Investment-Blackrock $
Institutional Funds 910,000 910,000
TOTAL OTHER 910,000
------------
TOTAL PORTFOLIO INVESTMENTS (98.79%) 179,808,918
CASH, RECEIVABLES AND
OTHER ASSETS, NET OF
LIABILITIES (1.21%) 2,202,978
TOTAL NET ASSETS (100.00%) $182,011,896
--------------
/1/ Non-income producing security.
144
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL BALANCED FUND, INC.
- -----------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.89 $10.63 $12.17 $14.50 $15.13 $15.28
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.08 0.16 0.20/(g)/ 0.29 0.32 0.40
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.37 1.26 (1.51)/(g)/ (2.13) 0.02 0.34
---- ---- ----- ----- ---- ----
Total From Investment
Operations 0.45 1.42 (1.31) (1.84) 0.34 0.74
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.09) (0.16) (0.23) (0.28) (0.33) (0.44)
Distributions from
Realized Gains...... -- -- -- (0.21) (0.64) (0.45)
---- ----- ----- -----
Total Dividends and
Distributions (0.09) (0.16) (0.23) (0.49) (0.97) (0.89)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $12.25 $11.89 $10.63 $12.17 $14.50 $15.13
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 3.80%/(e)/ 13.52% (10.94)% (12.91)% 2.40% 4.85%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $85,041 $82,198 $77,483 $80,547 $94,763 $112,329
Ratio of Expenses to
Average Net Assets.. 1.38%/(f)/ 1.46% 1.42% 1.35% 1.32% 1.28%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.39%/(f)/ 1.47% 1.43% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 1.30%/(f)/ 1.42% 1.71%/(g)/ 2.14% 2.26% 2.67%
Portfolio Turnover
Rate................ 138.7%/(f)/ 117.0% 88.1% 107.5% 54.4% 24.2%
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL BALANCED FUND, INC.
- -----------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.84 $10.59 $12.12 $14.43 $15.06 $15.22
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.03 0.07 0.12/(h)/ 0.19 0.21 0.29
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.37 1.26 (1.51)/(h)/ (2.11) 0.02 0.32
---- ---- ----- ----- ---- ----
Total From Investment
Operations 0.40 1.33 (1.39) (1.92) 0.23 0.61
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.05) (0.08) (0.14) (0.18) (0.22) (0.32)
Distributions from
Realized Gains...... -- -- -- (0.21) (0.64) (0.45)
---- ----- ----- -----
Total Dividends and
Distributions (0.05) (0.08) (0.14) (0.39) (0.86) (0.77)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $12.19 $11.84 $10.59 $12.12 $14.43 $15.06
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 3.36%/(e)/ 12.63% (11.55)% (13.53)% 1.61% 4.02%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $15,431 $15,405 $14,658 $17,900 $20,680 $23,570
Ratio of Expenses to
Average Net Assets.. 2.14%/(f)/ 2.25% 2.12% 2.05% 2.12% 2.02%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.14%/(f)/ 2.25% 2.13% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.55%/(f)/ 0.64% 1.02%/(h)/ 1.44% 1.46% 1.93%
Portfolio Turnover
Rate................ 138.7%/(f)/ 117.0% 88.1% 107.5% 54.4% 24.2%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without fees paid indirectly.
/(d) /Six months ended April 30, 2004.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
/(g) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class A was to decrease net investment
income by $.01 per share, increase net realized and unrealized gain (loss) on
investments by $.01 per share, and decrease the ratio of net investment income
to average net assets by .09%. Prior periods have not been restated to reflect
this change in presentation.
/(h) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class B was to decrease net investment
income by $.01 per share, increase net realized and unrealized gain (loss) on
investments by $.01 per share, and decrease the ratio of net investment income
to average net assets by .08%. Prior periods have not been restated to reflect
this change in presentation.
See accompanying notes.
145
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(C)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL BOND FUND, INC.
- -------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $10.99 $10.97 $11.11 $10.25 $10.66 $11.59
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.22 0.45 0.51/(f)/ 0.61 0.72 0.70
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.07) 0.06 (0.11)/(f)/ 0.88 (0.40) (0.91)
----- ---- ----- ---- ----- -----
Total From Investment
Operations 0.15 0.51 0.40 1.49 0.32 (0.21)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.24) (0.49) (0.54) (0.63) (0.73) (0.69)
Distributions from
Realized Gains...... -- -- -- -- -- (0.03)
---- -----
Total Dividends and
Distributions (0.24) (0.49) (0.54) (0.63) (0.73) (0.72)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $10.90 $10.99 $10.97 $11.11 $10.25 $10.66
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 1.36%/(d)/ 4.68% 3.83% 14.96% 3.23% (1.92)%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $180,605 $184,971 $186,723 $143,818 $124,630 $145,975
Ratio of Expenses to
Average Net Assets.. 1.02%/(e)/ 1.03% 1.06% 1.05% 1.06% 1.04%
Ratio of Net
Investment Income to
Average Net Assets.. 3.92%/(e)/ 4.00% 4.73%/(f)/ 5.67% 6.96% 6.25%
Portfolio Turnover
Rate................ 160.6%/(e)/ 79.7% 78.9% 152.0% 60.7% 48.9%
2004/(C)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL BOND FUND, INC.
- -------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $10.98 $10.97 $11.11 $10.24 $10.65 $11.58
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.17 0.35 0.43/(g)/ 0.54 0.64 0.61
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.06) 0.07 (0.11)/(g)/ 0.88 (0.39) (0.91)
----- ---- ----- ---- ----- -----
Total From Investment
Operations 0.11 0.42 0.32 1.42 0.25 (0.30)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.20) (0.41) (0.46) (0.55) (0.66) (0.60)
Distributions from
Realized Gains...... -- -- -- -- -- (0.03)
---- -----
Total Dividends and
Distributions (0.20) (0.41) (0.46) (0.55) (0.66) (0.63)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $10.89 $10.98 $10.97 $11.11 $10.24 $10.65
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.97%/(d)/ 3.86% 3.07% 14.23% 2.45% (2.68)%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $32,426 $33,883 $34,190 $26,348 $22,577 $25,451
Ratio of Expenses to
Average Net Assets.. 1.79%/(e)/ 1.84% 1.83% 1.68% 1.85% 1.79%
Ratio of Net
Investment Income to
Average Net Assets.. 3.15%/(e)/ 3.20% 3.95%/(g)/ 5.04% 6.16% 5.50%
Portfolio Turnover
Rate................ 160.6%/(e)/ 79.7% 78.9% 152.0% 60.7% 48.9%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Six months ended April 30, 2004.
/(d) /Total return amounts have not been annualized.
/(e) /Computed on an annualized basis.
/(f) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class A was to decrease net investment
income by $.03 per share, increase net realized and unrealized gain (loss) on
investments by $.03 per share, and decrease the ratio of net investment income
to average net assets by .30%. Prior periods have not been restated to reflect
this change in presentation.
/(g) /Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this change
for the year ended October 31, 2002 for Class B was to decrease net investment
income by $.03 per share, increase net realized and unrealized gain (loss) on
investments by $.03 per share, and decrease the ratio of net investment income
to average net assets by .30%. Prior periods have not been restated to reflect
this change in presentation.
See accompanying notes.
146
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL CAPITAL VALUE FUND, INC.
- ----------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $21.77 $18.48 $20.61 $25.04 $29.58 $31.07
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.12 0.21 0.22 0.20 0.34 0.52
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.24 3.30 (2.16) (3.40) (2.10) 0.45
---- ---- ----- ----- ----- ----
Total From Investment
Operations 1.36 3.51 (1.94) (3.20) (1.76) 0.97
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.24) (0.22) (0.19) (0.30) (0.25) (0.51)
Distributions from
Realized Gains...... -- -- -- (0.93) (2.53) (1.95)
---- ----- ----- -----
Total Dividends and
Distributions (0.24) (0.22) (0.19) (1.23) (2.78) (2.46)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $22.89 $21.77 $18.48 $20.61 $25.04 $29.58
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 6.27%/(f)/ 19.23% (9.52)% (13.31)% (6.20)% 3.00%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $326,570 $326,089 $333,016 $386,827 $452,251 $573,485
Ratio of Expenses to
Average Net Assets.. 0.95%/(g)/ 1.00% 1.01% 0.95% 0.94% 0.75%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 0.97%/(g)/ 1.01% 1.01% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 1.07%/(g)/ 1.05% 1.00% 0.90% 1.38% 1.73%
Portfolio Turnover
Rate................ 175.5%/(g)/ 132.1% 128.8% 126.2% 107.8% 44.5%
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL CAPITAL VALUE FUND, INC.
- ----------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $21.51 $18.30 $20.38 $24.76 $29.41 $30.90
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.02 0.02 0.06 0.03 0.11 0.29
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.23 3.28 (2.12) (3.37) (2.09) 0.44
---- ---- ----- ----- ----- ----
Total From Investment
Operations 1.25 3.30 (2.06) (3.34) (1.98) 0.73
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.04) (0.09) (0.02) (0.11) (0.14) (0.27)
Distributions from
Realized Gains...... -- -- -- (0.93) (2.53) (1.95)
---- ----- ----- -----
Total Dividends and
Distributions (0.04) (0.09) (0.02) (1.04) (2.67) (2.22)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $22.72 $21.51 $18.30 $20.38 $24.76 $29.41
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 5.80%/(f)/ 18.09% (10.13)% (13.96)% (7.03)% 2.24%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $28,301 $29,412 $27,235 $32,975 $39,017 $53,169
Ratio of Expenses to
Average Net Assets.. 1.87%/(g)/ 1.97% 1.72% 1.71% 1.82% 1.52%
Ratio of Gross
Expenses to Average
Net Assets /(d)/ ... 1.89%/(g)/ 1.98% 1.72% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.16%/(g)/ 0.08% 0.29% 0.15% 0.51% 0.96%
Portfolio Turnover
Rate................ 175.5%/(g)/ 132.1% 128.8% 126.2% 107.8% 44.5%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The voluntary expense limit began on March 1, 2003.
/(d) /Expense ratio without fees paid indirectly.
/(e) /Six months ended April 30, 2004.
/(f) /Total return amounts have not been annualized.
/(g) /Computed on an annualized basis.
See accompanying notes.
147
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL CASH MANAGEMENT FUND, INC.
- ------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.002 0.006 0.013 0.043 0.056 0.045
----- ----- ----- ----- ----- -----
Total From Investment
Operations 0.002 0.006 0.013 0.043 0.056 0.045
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.002) (0.006) (0.013) (0.043) (0.056) (0.045)
------ ------ ------ ------ ------ ------
Total Dividends and
Distributions (0.002) (0.006) (0.013) (0.043) (0.056) (0.045)
------ ------ ------ ------ ------ ------
Net Asset Value, End
of Period............ $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.19%/(e)/ 0.59% 1.36% 4.44% 5.71% 4.56%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $319,419 $346,292 $397,386 $412,409 $390,154 $352,675
Ratio of Expenses to
Average Net Assets.. 0.72%/(f)/ 0.75% 0.72% 0.70% 0.70% 0.69%
Ratio of Net
Investment Income to
Average Net Assets.. 0.39%/(f)/ 0.59% 1.35% 4.33% 5.54% 4.45%
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL CASH MANAGEMENT FUND, INC.
- ------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. -- 0.003 0.009 0.037 0.049 0.039
---- ----- ----- ----- ----- -----
Total From Investment
Operations -- 0.003 0.009 0.037 0.049 0.039
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- (0.003) (0.009) (0.037) (0.049) (0.039)
---- ------ ------ ------ ------ ------
Total Dividends and
Distributions -- (0.003) (0.009) (0.037) (0.049) (0.039)
---- ------ ------ ------ ------ ------
Net Asset Value, End
of Period............ $1.000 $1.000 $1.000 $1.000 $1.000 $1.000
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.00%/(e)/ 0.25% 0.88% 3.71% 5.01% 4.00%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $5,701 $7,695 $8,715 $6,655 $5,318 $6,330
Ratio of Expenses to
Average Net Assets.. 1.10%/(f)/ 1.09% 1.27% 1.40% 1.33% 1.19%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.24%/(f)/ 1.10% -- -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.00%/(f)/ 0.25% 0.87% 3.59% 4.87% 4.00%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(c) /Expense ratio without the Manager's voluntary expense limit.
/(d) /Six months ended April 30, 2004.
/(e) /Total return amounts have not been annualized.
/(f) /Computed on an annualized basis.
See accompanying notes.
148
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL EQUITY INCOME FUND, INC.
- ----------------------------------
CLASS A SHARES /(A)/
- --------------------
Net Asset Value,
Beginning of Period.. $9.38 $8.57 $10.69 $18.40 $17.86 $16.11
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(b)/ .............. 0.17 0.36 0.31 0.20 0.27 0.33
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.06) 0.81 (2.14) (4.05) 1.68 2.00
----- ---- ----- ----- ---- ----
Total From Investment
Operations 0.11 1.17 (1.83) (3.85) 1.95 2.33
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.18) (0.36) (0.29) (0.20) (0.27) (0.34)
Distributions from
Realized Gains...... -- -- -- (3.66) (1.14) (0.24)
---- ----- ----- -----
Total Dividends and
Distributions (0.18) (0.36) (0.29) (3.86) (1.41) (0.58)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $9.31 $9.38 $8.57 $10.69 $18.40 $17.86
===== ===== ===== ====== ====== ======
Total Return /(c)/ ... 1.05%/(f)/ 13.86% (17.30)% (25.74)% 12.09% 14.74%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $61,665 $60,703 $57,881 $72,581 $101,352 $99,857
Ratio of Expenses to
Average Net Assets.. 1.36%/(g)/ 1.46% 1.48% 1.31% 1.23% 1.20%
Ratio of Gross
Expenses to Average
Net Assets /(d)/ ... 1.36%/(g)/ -- -- -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 3.55%/(g)/ 4.02% 3.15% 1.51% 1.59% 1.94%
Portfolio Turnover
Rate................ 142.8%/(g)/ 19.1% 79.4% 106.2% 150.8% 23.5%
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL EQUITY INCOME FUND, INC.
- ----------------------------------
CLASS B SHARES /(A)/
- --------------------
Net Asset Value,
Beginning of Period.. $9.34 $8.53 $10.64 $18.37 $17.83 $16.09
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(b)/ .............. 0.13 0.28 0.21 0.10 0.14 0.22
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.05) 0.80 (2.11) (4.07) 1.69 1.98
----- ---- ----- ----- ---- ----
Total From Investment
Operations 0.08 1.08 (1.90) (3.97) 1.83 2.20
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.14) (0.27) (0.21) (0.10) (0.15) (0.22)
Distributions from
Realized Gains...... -- -- -- (3.66) (1.14) (0.24)
---- ----- ----- -----
Total Dividends and
Distributions (0.14) (0.27) (0.21) (3.76) (1.29) (0.46)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $9.28 $9.34 $8.53 $10.64 $18.37 $17.83
===== ===== ===== ====== ====== ======
Total Return /(c)/ ... 0.74%/(f)/ 12.85% (18.02)% (26.41)% 11.30% 13.85%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $10,282 $9,775 $9,982 $15,152 $19,624 $18,282
Ratio of Expenses to
Average Net Assets.. 2.21%/(g)/ 2.34% 2.37% 2.15% 2.00% 1.95%
Ratio of Gross
Expenses to Average
Net Assets /(d)/ ... 2.23%/(g)/ -- -- -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 2.71%/(g)/ 3.14% 2.19% 0.66% 0.82% 1.19%
Portfolio Turnover
Rate................ 142.8%/(g)/ 19.1% 79.4% 106.2% 150.8% 23.5%
/(a) /Effective March 1, 2004, the Principal Utilities Fund, Inc. changed its
name to Principal Equity Income Fund, Inc.
/(b) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(c) /Total return is calculated without the front-end sales charge or
contingent deferred sales charge.
/(d) /Expense ratio without the Manager's voluntary expense limit. The expense
limit began on March 1, 2004.
/(e) /Six months ended April 30, 2004.
/(f) /Total return amounts have not been annualized.
/(g) /Computed on an annualized basis.
See accompanying notes.
149
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(C)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL GOVERNMENT SECURITIES
- -------------------------------
INCOME FUND, INC.
- -----------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.41 $11.74 $11.77 $11.18 $11.10 $11.63
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.22 0.45 0.60 0.65 0.68 0.69
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.13) (0.26) 0.01 0.61 0.07 (0.52)
----- ----- ---- ---- ---- -----
Total From Investment
Operations 0.09 0.19 0.61 1.26 0.75 0.17
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.27) (0.52) (0.64) (0.67) (0.67) (0.70)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.27) (0.52) (0.64) (0.67) (0.67) (0.70)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $11.23 $11.41 $11.74 $11.77 $11.18 $11.10
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.76%/(d)/ 1.59% 5.41% 11.64% 7.09% 1.47%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $285,704 $304,191 $310,506 $243,876 $213,114 $237,811
Ratio of Expenses to
Average Net Assets.. 0.92%/(e)/ 0.93% 0.90% 0.90% 0.94% 0.89%
Ratio of Net
Investment Income to
Average Net Assets.. 3.85%/(e)/ 3.82% 5.11% 5.68% 6.14% 6.04%
Portfolio Turnover
Rate................ 50.3%/(e)/ 181.1% 36.5% 51.9% 6.9% 19.4%
2004/(C)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL GOVERNMENT SECURITIES
- -------------------------------
INCOME FUND, INC.
- -----------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.35 $11.67 $11.71 $11.13 $11.05 $11.60
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.18 0.35 0.52 0.58 0.58 0.61
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.14) (0.24) (0.01) 0.59 0.09 (0.54)
----- ----- ----- ---- ---- -----
Total From Investment
Operations 0.04 0.11 0.51 1.17 0.67 0.07
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.22) (0.43) (0.55) (0.59) (0.59) (0.62)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.22) (0.43) (0.55) (0.59) (0.59) (0.62)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $11.17 $11.35 $11.67 $11.71 $11.13 $11.05
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.37%/(d)/ 0.91% 4.54% 10.82% 6.32% 0.65%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $57,024 $62,573 $52,839 $36,303 $27,395 $29,751
Ratio of Expenses to
Average Net Assets.. 1.67%/(e)/ 1.70% 1.71% 1.59% 1.75% 1.63%
Ratio of Net
Investment Income to
Average Net Assets.. 3.10%/(e)/ 3.06% 4.30% 4.98% 5.33% 5.30%
Portfolio Turnover
Rate................ 50.3%/(e)/ 181.1% 36.5% 51.9% 6.9% 19.4%
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Six months ended April 30, 2004./
/(d) //Total return amounts have not been annualized./
/(e) //Computed on an annualized basis./
See accompanying notes.
150
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL GROWTH FUND, INC.
- ---------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $25.44 $22.10 $27.06 $71.22 $65.57 $56.09
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.05) (0.09) (0.18) (0.30) (0.37) 0.21
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.00 3.43 (4.78) (21.79) 8.43 9.56
---- ---- ----- ------ ---- ----
Total From Investment
Operations 0.95 3.34 (4.96) (22.09) 8.06 9.77
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- -- -- -- -- (0.29)
Distributions from
Realized Gains...... -- -- -- (22.07) (2.41) --
---- ------ -----
Total Dividends and
Distributions -- -- -- (22.07) (2.41) (0.29)
---- ------ ----- -----
Net Asset Value, End
of Period............ $26.39 $25.44 $22.10 $27.06 $71.22 $65.57
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 3.73%/(e)/ 15.11% (18.33)% (41.87)% 12.64% 17.46%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $267,765 $263,119 $243,504 $291,541 $525,175 $493,117
Ratio of Expenses to
Average Net Assets.. 1.24%/(f)/ 1.37% 1.41% 1.30% 1.08% 0.89%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.24%/(f)/ 1.37% -- -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. (0.41)%/(f)/ (0.42)% (0.66)% (0.71)% (0.52)% 0.33%
Portfolio Turnover
Rate................ 35.0%/(f)/ 46.6%/(g)/ 22.4% 33.4% 121.5% 32.4%
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL GROWTH FUND, INC.
- ---------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $24.49 $21.45 $26.43 $70.41 $65.33 $55.98
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.16) (0.28) (0.41) (0.24) (0.89) (0.17)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.96 3.32 (4.57) (21.67) 8.38 9.55
---- ---- ----- ------ ---- ----
Total From Investment
Operations 0.80 3.04 (4.98) (21.91) 7.49 9.38
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- -- -- -- -- (0.03)
Distributions from
Realized Gains...... -- -- -- (22.07) (2.41) --
---- ------ -----
Total Dividends and
Distributions -- -- -- (22.07) (2.41) (0.03)
---- ------ ----- -----
Net Asset Value, End
of Period............ $25.29 $24.49 $21.45 $26.43 $70.41 $65.33
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 3.27%/(e)/ 14.17% (18.84)% (42.21)% 11.79% 16.75%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $44,737 $47,163 $48,214 $64,111 $110,001 $96,116
Ratio of Expenses to
Average Net Assets.. 2.08%/(f)/ 2.22% 2.05% 1.88% 1.85% 1.50%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.08%/(f)/ 2.22% -- -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. (1.24)%/(f)/ (1.27)% (1.30)% (1.29)% (1.30)% (0.28)%
Portfolio Turnover
Rate................ 35.0%/(f)/ 46.6%/(g)/ 22.4% 33.4% 121.5% 32.4%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly./
/(d) /Six months ended April 30, 2004.
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
/(g) //Portfolio turnover rate excludes portfolio realignment of approximately
$7,623,000 from the acquisition of Principal Partners LargeCap Growth Fund,
Inc./
See accompanying notes.
151
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL EMERGING
- --------------------------------
MARKETS FUND, INC.
- ------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $10.16 $6.77 $6.44 $8.75 $8.56 $6.54
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.03 0.01 (0.05) (0.03) (0.10) (0.03)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.68 3.38 0.38 (2.22) 0.31 2.05
---- ---- ---- ----- ---- ----
Total From Investment
Operations 0.71 3.39 0.33 (2.25) 0.21 2.02
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- -- -- -- (0.02) --
Distributions from
Realized Gains...... -- -- -- (0.06) -- --
---- -----
Total Dividends and
Distributions -- -- -- (0.06) (0.02) --
---- ----- -----
Net Asset Value, End
of Period............ $10.87 $10.16 $6.77 $6.44 $8.75 $8.56
====== ====== ===== ===== ===== =====
Total Return /(b)/ ... 6.99%/(e)/ 50.07% 5.12% (25.85)% 2.36% 30.89%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $31,286 $26,909 $18,029 $15,335 $17,890 $13,401
Ratio of Expenses to
Average Net Assets.. 2.22%/(f)/ 2.57% 2.48% 2.50% 2.49% 2.75%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.25%/(f)/ 2.70% 2.77% 2.71% 2.59% --
Ratio of Net
Investment Income to
Average Net Assets.. 0.48%/(f)/ 0.12% (0.36)% (0.06)% (1.05)% (0.35)%
Portfolio Turnover
Rate................ 119.8%/(f)/ 117.3% 165.4% 120.5% 112.9% 95.8%
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL EMERGING
- --------------------------------
MARKETS FUND, INC.
- ------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $9.76 $6.56 $6.28 $8.60 $8.47 $6.52
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.01) (0.05) (0.06) (0.05) (0.16) (0.07)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.65 3.25 0.34 (2.21) 0.29 2.02
---- ---- ---- ----- ---- ----
Total From Investment
Operations 0.64 3.20 0.28 (2.26) 0.13 1.95
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- (0.06) -- --
---- -----
Total Dividends and
Distributions -- -- -- (0.06) -- --
---- -----
Net Asset Value, End
of Period............ $10.40 $9.76 $6.56 $6.28 $8.60 $8.47
====== ===== ===== ===== ===== =====
Total Return /(b)/ ... 6.56%/(e)/ 48.78% 4.46% (26.42)% 1.53% 29.91%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $8,860 $7,710 $5,241 $4,728 $6,198 $5,051
Ratio of Expenses to
Average Net Assets.. 2.92%/(f)/ 3.29% 3.23% 3.25% 3.22% 3.57%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.94%/(f)/ 3.42% 3.50% 3.39% 3.22% --
Ratio of Net
Investment Income to
Average Net Assets.. (0.21)%/(f)/ (0.61)% (1.13)% (0.84)% (1.78)% (1.12)%
Portfolio Turnover
Rate................ 119.8%/(f)/ 117.3% 165.4% 120.5% 112.9% 95.8%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The expense limit began on the first day of the period ended /
/October 31, 2000. Expense limits were increased on March 1, 2003 and ceased
on March 1, 2004./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
See accompanying notes.
152
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL FUND, INC.
- ----------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $6.20 $5.05 $5.75 $8.85 $10.04 $9.20
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.01 0.04 0.02 0.02 0.16 0.13
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.59 1.11 (0.71) (2.34) 0.20 1.28
---- ---- ----- ----- ---- ----
Total From Investment
Operations 0.60 1.15 (0.69) (2.32) 0.36 1.41
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.05) -- (0.01) (0.05) (0.23) (0.11)
Distributions from
Realized Gains...... -- -- -- (0.73) (1.32) (0.46)
---- ----- ----- -----
Total Dividends and
Distributions (0.05) -- (0.01) (0.78) (1.55) (0.57)
---- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $6.75 $6.20 $5.05 $5.75 $8.85 $10.04
===== ===== ===== ===== ===== ======
Total Return /(b)/ ... 9.74%/(f)/ 22.81% (11.94)% (28.64)% 3.04% 16.18%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $210,402 $200,005 $197,946 $224,177 $325,369 $338,144
Ratio of Expenses to
Average Net Assets.. 1.42%/(g)/ 1.55% 1.57% 1.42% 1.27% 1.22%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.44%/(g)/ 1.55% 1.57% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.44%/(g)/ 0.84% 0.32% 0.27% 1.76% 1.35%
Portfolio Turnover
Rate................ 157.1%/(g)/ 100.8%/(h)/ 73.5% 93.9% 92.7% 58.7%
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL FUND, INC.
- ----------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $6.05 $4.98 $5.71 $8.78 $9.96 $9.14
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.02) (0.01) (0.03) (0.03) 0.11 0.06
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.58 1.08 (0.70) (2.31) 0.20 1.27
---- ---- ----- ----- ---- ----
Total From Investment
Operations 0.56 1.07 (0.73) (2.34) 0.31 1.33
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- -- -- -- (0.17) (0.05)
Distributions from
Realized Gains...... -- -- -- (0.73) (1.32) (0.46)
---- ----- ----- -----
Total Dividends and
Distributions -- -- -- (0.73) (1.49) (0.51)
---- ----- ----- -----
Net Asset Value, End
of Period............ $6.61 $6.05 $4.98 $5.71 $8.78 $9.96
===== ===== ===== ===== ===== =====
Total Return /(b)/ ... 9.26%/(f)/ 21.49% (12.78)% (28.97)% 2.43% 15.27%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $28,059 $28,498 $28,607 $33,277 $48,692 $48,319
Ratio of Expenses to
Average Net Assets.. 2.30%/(g)/ 2.47% 2.39% 2.08% 1.88% 1.90%
Ratio of Gross
Expenses to Average
Net Assets /(d)/ ... 2.32%/(g)/ 2.47% 2.40% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. (0.48)%/(g)/ (0.13)% (0.50)% (0.41)% 1.13% 0.67%
Portfolio Turnover
Rate................ 157.1%/(g)/ 100.8%/(h)/ 73.5% 93.9% 92.7% 58.7%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The voluntary expense limit began on March 1, 2003./
/(d) /Expense ratio without fees paid indirectly.
/(e) /Six months ended April 30, 2004.
/(f) /Total return amounts have not been annualized.
/(g) /Computed on an annualized basis.
/(h) /Portfolio turnover rate excludes portfolio realignment of approximately
$4,997,000 from the acquisition of Principal European Equity Fund, Inc. and
Principal Pacific Basin Fund, Inc.
See accompanying notes.
153
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL SMALLCAP FUND, INC.
- -------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.84 $8.39 $9.49 $17.00 $15.32 $9.99
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. -- (0.02) (0.05) (0.23) (0.32) (0.12)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.94 3.47 (1.05) (4.62) 3.51 5.53
---- ---- ----- ----- ---- ----
Total From Investment
Operations 1.94 3.45 (1.10) (4.85) 3.19 5.41
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- (0.01) -- -- -- --
Distributions from
Realized Gains...... -- -- -- (2.66) (1.51) (0.08)
---- ----- ----- -----
Total Dividends and
Distributions -- (0.01) -- (2.66) (1.51) (0.08)
---- ----- ----- ----- -----
Redemption Fees /(a)/ -- 0.01 -- -- -- --
---- ----
Net Asset Value, End
of Period............ $13.78 $11.84 $8.39 $9.49 $17.00 $15.32
====== ====== ===== ===== ====== ======
Total Return /(b)/ ... 16.39%/(e)/ 41.22% (11.59)% (33.02)% 21.21% 54.52%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $43,345 $35,588 $26,821 $28,977 $36,322 $23,612
Ratio of Expenses to
Average Net Assets.. 2.15%/(f)/ 2.62% 2.49% 2.74% 2.46% 2.21%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.19%/(f)/ 2.63% 2.49% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.00%/(f)/ (0.22)% (0.35)% (1.08)% (1.41)% (1.02)%
Portfolio Turnover
Rate................ 101.3%/(f)/ 144.5% 80.3% 151.6% 329.8% 191.5%
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL INTERNATIONAL SMALLCAP FUND, INC.
- -------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $11.31 $8.08 $9.23 $16.72 $15.18 $9.97
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.05) (0.09) (0.13) (0.05) (0.41) (0.20)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.86 3.32 (1.02) (4.78) 3.46 5.49
---- ---- ----- ----- ---- ----
Total From Investment
Operations 1.81 3.23 (1.15) (4.83) 3.05 5.29
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- (2.66) (1.51) (0.08)
---- ----- ----- -----
Total Dividends and
Distributions -- -- -- (2.66) (1.51) (0.08)
---- ----- ----- -----
Net Asset Value, End
of Period............ $13.12 $11.31 $8.08 $9.23 $16.72 $15.18
====== ====== ===== ===== ====== ======
Total Return /(b)/ ... 16.00%/(e)/ 39.98% (12.46)% (33.52)% 20.43% 53.42%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $12,453 $10,251 $7,536 $8,641 $12,539 $10,926
Ratio of Expenses to
Average Net Assets.. 2.92%/(f)/ 3.44% 3.40% 3.46% 3.04% 2.87%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.97%/(f)/ 3.46% 3.41% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. (0.78)%/(f)/ (1.05)% (1.27)% (1.83)% (1.99)% (1.68)%
Portfolio Turnover
Rate................ 101.3%/(f)/ 144.5% 80.3% 151.6% 329.8% 191.5%
/(a) /Effective November 1, 2002, calculated based on average shares outstanding
during the period.
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The expense limit began on March 1, 2004./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
See accompanying notes.
154
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000/(G)/
---- ---- ---- ---- ----
PRINCIPAL LARGECAP STOCK INDEX FUND, INC.
- -----------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $7.80 $6.57 $7.85 $10.59 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.03 0.06 0.05 0.05 0.03
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.42 1.22 (1.29) (2.74) 0.56
---- ---- ----- ----- ----
Total From Investment
Operations 0.45 1.28 (1.24) (2.69) 0.59
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.06) (0.05) (0.04) (0.05) --
---- ----- ----- ----- -----
Total Dividends and
Distributions (0.06) (0.05) (0.04) (0.05) --
---- ----- ----- ----- -----
Net Asset Value, End
of Period............ $8.19 $7.80 $6.57 $7.85 $10.59
===== ===== ===== ===== ======
Total Return /(b)/ ... 5.79%/(e)/ 19.62% (15.92)% (25.46)% 4.96%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $51,296 $41,913 $33,538 $15,886 $9,855
Ratio of Expenses to
Average Net Assets.. 0.90%/(f)/ 0.90% 0.90% 0.90% 0.79%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.04%/(f)/ 1.25% 1.20% 1.44% 1.82%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 0.74%/(f)/ 0.89% 0.65% 0.59% 0.76%/(f)/
Portfolio Turnover
Rate................ 40.7%/(f)/ 20.1% 19.3% 39.3% 189.7%/(f)/
2004/(D)/ 2003 2002 2001 2000/(G)/
---- ---- ---- ---- ----
PRINCIPAL LARGECAP STOCK INDEX FUND, INC.
- -----------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $7.80 $6.57 $7.84 $10.56 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.02 0.04 0.01 0.01 0.02
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.40 1.22 (1.28) (2.72) 0.54
---- ---- ----- ----- ----
Total From Investment
Operations 0.42 1.26 (1.27) (2.71) 0.56
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.03) (0.03) -- (0.01) --
----- ----- ----- -----
Total Dividends and
Distributions (0.03) (0.03) -- (0.01) --
----- ----- ----- -----
Net Asset Value, End
of Period............ $8.19 $7.80 $6.57 $7.84 $10.56
===== ===== ===== ===== ======
Total Return /(b)/ ... 5.44%/(e)/ 19.20% (16.18)% (25.65)% 4.66%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $12,075 $9,474 $5,684 $4,731 $2,838
Ratio of Expenses to
Average Net Assets.. 1.25%/(f)/ 1.25% 1.25% 1.25% 1.14%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.43%/(f)/ 1.71% 1.74% 1.87% 2.44%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 0.39%/(f)/ 0.53% 0.33% 0.23% 0.45%/(f)/
Portfolio Turnover
Rate................ 40.7%/(f)/ 20.1% 19.3% 39.3% 189.7%/(f)/
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without the Manager's voluntary expense limit. The expense
limit began on the first day of the period ended October 31, 2000. The /
/expense limits for each class were increased on November 1, 2000./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
/(g) //Period from March 1, 2000, date shares first offered, through October 31,
2000./
See accompanying notes.
155
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL LIMITED TERM BOND FUND, INC.
- --------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $9.74 $9.86 $9.98 $9.50 $9.54 $9.93
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.14 0.29 0.43/(g)/ 0.56 0.59 0.57
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.07) 0.01 (0.08)/(g)/ 0.49 (0.05) (0.39)
----- ---- ----- ---- ----- -----
Total From Investment
Operations 0.07 0.30 0.35 1.05 0.54 0.18
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.22) (0.42) (0.47) (0.57) (0.58) (0.57)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.22) (0.42) (0.47) (0.57) (0.58) (0.57)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $9.59 $9.74 $9.86 $9.98 $9.50 $9.54
===== ===== ===== ===== ===== =====
Total Return /(b)/ ... 0.68%/(e)/ 3.04% 3.70% 11.36% 5.94% 1.83%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $103,250 $96,568 $74,719 $37,942 $25,183 $27,096
Ratio of Expenses to
Average Net Assets.. 0.88%/(f)/ 0.93% 0.94% 1.01% 0.99% 1.00%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... -- -- -- -- 1.20% 1.14%
Ratio of Net
Investment Income to
Average Net Assets.. 2.84%/(f)/ 3.02% 4.07%/(g)/ 5.69% 6.16% 5.76%
Portfolio Turnover
Rate................ 29.9%/(f)/ 26.2% 97.6% 65.7% 31.5% 20.9%
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL LIMITED TERM BOND FUND, INC.
- --------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $9.88 $10.00 $10.11 $9.60 $9.60 $9.98
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.12 0.26 0.37/(h)/ 0.49 0.55 0.52
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.06) (0.01) (0.06)/(h)/ 0.53 (0.02) (0.39)
----- ----- ----- ---- ----- -----
Total From Investment
Operations 0.06 0.25 0.31 1.02 0.53 0.13
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.20) (0.37) (0.42) (0.51) (0.53) (0.51)
----- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.20) (0.37) (0.42) (0.51) (0.53) (0.51)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $9.74 $9.88 $10.00 $10.11 $9.60 $9.60
===== ===== ====== ====== ===== =====
Total Return /(b)/ ... 0.56%/(e)/ 2.54% 3.25% 10.84% 5.69% 1.29%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $17,471 $17,779 $13,387 $6,970 $3,291 $2,696
Ratio of Expenses to
Average Net Assets.. 1.29%/(f)/ 1.35% 1.39% 1.50% 1.34% 1.35%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... -- -- -- -- 1.93% 1.92%
Ratio of Net
Investment Income to
Average Net Assets.. 2.43%/(f)/ 2.60% 3.61%/(h)/ 5.17% 5.81% 5.41%
Portfolio Turnover
Rate................ 29.9%/(f)/ 26.2% 97.6% 65.7% 31.5% 20.9%
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b)// Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without the Manager's voluntary expense limit. The expense
limit ceased on November 1, 2000./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
/(g) //Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this /
/change for the year ended October 31, 2002 for Class A was to decrease net
investment income by $.07 per share, increase net realized and unrealized /
/gain (loss) on investments by $.07 per share, and decrease the ratio of net
investment income to average net assets by 1.81%. Prior periods have not /
/been restated to reflect this change in presentation./
/(h) //Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. The effect of this /
/change for the year ended October 31, 2002 for Class B was to decrease net
investment income by $.07 per share, increase net realized and unrealized /
/gain (loss) on investments by $.07 per share, and decrease the ratio of net
investment income to average net assets by 1.86%. Prior periods have not /
/been restated to reflect this change in presentation./
See accompanying notes.
156
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL MIDCAP FUND, INC.
- ---------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $39.20 $31.01 $33.08 $52.01 $42.12 $39.90
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.14 0.09 0.08 (0.02) (0.16) (0.06)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 3.44 8.20 (1.09) (3.75) 12.08 2.28
---- ---- ----- ----- ----- ----
Total From Investment
Operations 3.58 8.29 (1.01) (3.77) 11.92 2.22
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.18) (0.10) (0.07) -- -- --
Distributions from
Realized Gains...... (1.87) -- (0.99) (15.16) (2.03) --
---- ----- ----- ------ -----
Total Dividends and
Distributions (2.05) (0.10) (1.06) (15.16) (2.03) --
---- ----- ----- ----- ------ -----
Net Asset Value, End
of Period............ $40.73 $39.20 $31.01 $33.08 $52.01 $42.12
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 9.35%/(e)/ 26.81% (3.36)% (9.14)% 29.21% 5.56%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $437,734 $396,239 $319,410 $319,523 $364,639 $313,984
Ratio of Expenses to
Average Net Assets.. 1.03%/(f)/ 1.19% 1.24% 1.16% 1.17% 1.22%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.03%/(f)/ 1.19% 1.25% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.69%/(f)/ 0.28% 0.27% 0.20% (0.36)% (0.17)%
Portfolio Turnover
Rate................ 37.3%/(f)/ 50.4% 76.2% 66.6% 161.8% 59.9%
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL MIDCAP FUND, INC.
- ---------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $37.35 $29.59 $31.75 $50.71 $41.29 $39.29
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.04 (0.05) (0.15) 0.22 (0.42) (0.28)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 3.29 7.81 (1.02) (4.02) 11.87 2.28
---- ---- ----- ----- ----- ----
Total From Investment
Operations 3.33 7.76 (1.17) (3.80) 11.45 2.00
Less Dividends and
Distributions:
Distributions from
Realized Gains...... (1.87) -- (0.99) (15.16) (2.03) --
---- ----- ----- ------ -----
Total Dividends and
Distributions (1.87) -- (0.99) (15.16) (2.03) --
---- ----- ----- ------ -----
Net Asset Value, End
of Period............ $38.81 $37.35 $29.59 $31.75 $50.71 $41.29
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 9.13%/(e)/ 26.23% (4.00)% (9.55)% 28.63% 5.09%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $73,319 $70,586 $64,538 $71,330 $80,721 $68,639
Ratio of Expenses to
Average Net Assets.. 1.51%/(f)/ 1.64% 1.90% 1.61% 1.62% 1.67%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.52%/(f)/ 1.64% 1.90% -- -- --
Ratio of Net
Investment Income to
Average Net Assets.. 0.23%/(f)/ (0.16)% (0.39)% (0.25)% (0.80)% (0.62)%
Portfolio Turnover
Rate................ 37.3%/(f)/ 50.4% 76.2% 66.6% 161.8% 59.9%
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
See accompanying notes.
157
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL PARTNERS BLUE CHIP FUND, INC.
- ---------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $16.16 $13.59 $17.04 $24.26 $25.25 $21.71
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.02 -- (0.02) (0.02) 0.04 0.15
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.05 2.57 (3.42) (6.84) (0.69) 3.53
---- ---- ----- ----- ----- ----
Total From Investment
Operations 1.07 2.57 (3.44) (6.86) (0.65) 3.68
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- -- -- -- (0.05) (0.14)
Distributions from
Realized Gains...... -- -- -- (0.33) (0.29) --
Tax Return of Capital
Distributions /(b)/. -- -- (0.01) (0.03) -- --
---- ----- -----
Total Dividends and
Distributions -- -- (0.01) (0.36) (0.34) (0.14)
---- ----- ----- ----- -----
Net Asset Value, End
of Period............ $17.23 $16.16 $13.59 $17.04 $24.26 $25.25
====== ====== ====== ====== ====== ======
Total Return /(c)/ ... 6.62%/(f)/ 18.91% (20.19)% (28.63)% (2.60)% 17.00%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $124,696 $117,931 $104,481 $120,173 $170,462 $184,217
Ratio of Expenses to
Average Net Assets.. 1.34%/(g)/ 1.68% 1.54% 1.50% 1.19% 1.26%
Ratio of Gross
Expenses to Average
Net Assets /(d)/ ... 1.35%/(g)/ 1.69% 1.54% -- 1.33% --
Ratio of Net
Investment Income to
Average Net Assets.. 0.22%/(g)/ 0.00% (0.08)% (0.10)% 0.19% 0.63%
Portfolio Turnover
Rate................ 60.4%/(g)/ 87.6% 79.8% 74.4% 73.6% 16.4%
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL PARTNERS BLUE CHIP FUND, INC.
- ---------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $15.60 $13.22 $16.65 $23.89 $25.00 $21.55
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.05) (0.11) (0.13) (0.16) (0.14) (0.02)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 1.01 2.49 (3.30) (6.72) (0.67) 3.48
---- ---- ----- ----- ----- ----
Total From Investment
Operations 0.96 2.38 (3.43) (6.88) (0.81) 3.46
Less Dividends and
Distributions:
Dividends from Net
Investment Income... -- -- -- -- (0.01) (0.01)
Distributions from
Realized Gains...... -- -- -- (0.33) (0.29) --
Tax Return of Capital
Distributions /(b)/. -- -- -- (0.03) -- --
---- -----
Total Dividends and
Distributions -- -- -- (0.36) (0.30) (0.01)
---- ----- ----- -----
Net Asset Value, End
of Period............ $16.56 $15.60 $13.22 $16.65 $23.89 $25.00
====== ====== ====== ====== ====== ======
Total Return /(c)/ ... 6.15%/(f)/ 18.00% (20.60)% (29.16)% (3.30)% 16.09%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $28,541 $29,233 $27,704 $38,531 $54,550 $56,493
Ratio of Expenses to
Average Net Assets.. 2.18%/(g)/ 2.46% 2.10% 2.21% 1.94% 2.04%
Ratio of Gross
Expenses to Average
Net Assets /(d)/ ... 2.19%/(g)/ 2.47% 2.10% -- 2.05% --
Ratio of Net
Investment Income to
Average Net Assets.. (0.61)%/(g)/ (0.78)% (0.64)% (0.81)% (0.56)% (0.15)%
Portfolio Turnover
Rate................ 60.4%/(g)/ 87.6% 79.8% 74.4% 73.6% 16.4%
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //See "Distributions to Shareholders" in the Notes to Financial
Statements./
/(c) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(d) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The expense limit was effective for the year ended October 31,
/ /2000./
/(e) //Six months ended April 30, 2004./
/(f) //Total return amounts have not been annualized./
/(g) //Computed on an annualized basis./
See accompanying notes.
158
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000
---- ---- ---- ---- ----
PRINCIPAL PARTNERS EQUITY GROWTH FUND, INC.
- -------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $7.00 $6.12 $7.62 $11.36 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.02) (0.05) (0.10) (0.10) (0.05)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.19 0.93 (1.40) (3.64) 1.41
---- ---- ----- ----- ----
Total From Investment
Operations 0.17 0.88 (1.50) (3.74) 1.36
---- ---- ----- ----- ----
Net Asset Value, End
of Period............ $7.17 $7.00 $6.12 $7.62 $11.36
===== ===== ===== ===== ======
Total Return /(b)/ ... 2.43%/(e)/ 14.38% (19.69)% (32.92)% 13.60%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $45,419 $43,061 $37,451 $38,303 $49,794
Ratio of Expenses to
Average Net Assets.. 1.63%/(f)/ 1.89% 1.98% 1.90% 1.57%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.75%/(f)/ 1.99% -- -- 1.99%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (0.68)%/(f)/ (0.74)% (1.07)% (1.10)% (0.68)%/(f)/
Portfolio Turnover
Rate................ 146.9%/(f)/ 124.7% 138.9% 86.4% 62.0%/(f)/
2004/(D)/ 2003 2002 2001 2000
---- ---- ---- ---- ----
PRINCIPAL PARTNERS EQUITY GROWTH FUND, INC.
- -------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $6.79 $5.99 $7.52 $11.28 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.05) (0.09) (0.11) (0.13) (0.10)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.19 0.89 (1.42) (3.63) 1.38
---- ---- ----- ----- ----
Total From Investment
Operations 0.14 0.80 (1.53) (3.76) 1.28
---- ---- ----- ----- ----
Net Asset Value, End
of Period............ $6.93 $6.79 $5.99 $7.52 $11.28
===== ===== ===== ===== ======
Total Return /(b)/ ... 2.06%/(e)/ 13.36% (20.35)% (33.33)% 12.80%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $15,505 $14,849 $12,939 $15,419 $19,430
Ratio of Expenses to
Average Net Assets.. 2.34%/(f)/ 2.65% 2.76% 2.63% 2.31%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.46%/(f)/ 2.72% -- -- 2.61%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (1.39)%/(f)/ (1.50)% (1.85)% (1.82)% (1.41)%/(f)/
Portfolio Turnover
Rate................ 146.9%/(f)/ 124.7% 138.9% 86.4% 62.0%/(f)/
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The expense limit was effective for the year ended October 31,
/ /2000. The expense limit began again on March 1, 2003 and decreased on
March 1, 2004./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
See accompanying notes.
159
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001/(G)/
---- ---- ---- ----
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
- --------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $9.14 $7.97 $9.00 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. -- -- (0.01) --
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.47 1.17 (1.02) (1.00)
---- ---- ----- -----
Total From Investment
Operations 0.47 1.17 (1.03) (1.00)
---- ---- ----- -----
Net Asset Value, End
of Period............ $9.61 $9.14 $7.97 $9.00
===== ===== ===== =====
Total Return /(b)/ ... 5.14%/(e)/ 14.68% (11.44)% (10.00)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $37,523 $33,155 $18,781 $7,694
Ratio of Expenses to
Average Net Assets.. 1.50%/(f)/ 1.79% 1.95% 1.95%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.55%/(f)/ 1.82% 1.98% 2.25%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 0.08%/(f)/ 0.06% (0.02)% (0.09)%/(f)/
Portfolio Turnover
Rate................ 166.4%/(f)/ 33.0% 67.5% 56.9%/(f)/
2004/(D)/ 2003 2002 2001/(G)/
---- ---- ---- ----
PRINCIPAL PARTNERS LARGECAP BLEND FUND, INC.
- --------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $8.95 $7.87 $8.94 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.03) (0.05) (0.03) (0.04)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.46 1.13 (1.04) (1.02)
---- ---- ----- -----
Total From Investment
Operations 0.43 1.08 (1.07) (1.06)
---- ---- ----- -----
Net Asset Value, End
of Period............ $9.38 $8.95 $7.87 $8.94
===== ===== ===== =====
Total Return /(b)/ ... 4.80%/(e)/ 13.72% (11.97)% (10.60)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $16,787 $14,702 $6,552 $2,670
Ratio of Expenses to
Average Net Assets.. 2.23%/(f)/ 2.49% 2.70% 2.70%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.26%/(f)/ 2.55% 2.78% 3.01%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (0.65)%/(f)/ (0.64)% (0.77)% (0.84)%/(f)/
Portfolio Turnover
Rate................ 166.4%/(f)/ 33.0% 67.5% 56.9%/(f)/
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. Expense limits for each class were decreased on March 1, 2003
/ /and March 1, 2004./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
/(g) //Period from December 22, 2000, date shares first offered, through October
31, 2001./
See accompanying notes.
160
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001/(G)/
---- ---- ---- ----
PRINCIPAL PARTNERS LARGECAP VALUE FUND, INC.
- --------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $10.94 $8.89 $9.98 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.04 0.08 0.03 0.02
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.70 2.00 (1.00) (0.04)
---- ---- ----- -----
Total From Investment
Operations 0.74 2.08 (0.97) (0.02)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.07) (0.03) (0.03) --
Distributions from
Realized Gains...... -- -- (0.09) --
----- -----
Total Dividends and
Distributions (0.07) (0.03) (0.12) --
---- ----- ----- -----
Net Asset Value, End
of Period............ $11.61 $10.94 $8.89 $9.98
====== ====== ===== =====
Total Return /(b)/ ... 6.80%/(e)/ 23.51% (9.89)% (0.20)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $41,035 $34,298 $21,677 $8,146
Ratio of Expenses to
Average Net Assets.. 1.48%/(f)/ 1.73% 1.90% 1.95%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.51%/(f)/ 1.76% 1.90% 2.04%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. 0.71%/(f)/ 0.81% 0.45% 0.43%/(f)/
Portfolio Turnover
Rate................ 24.7%/(f)/ 18.5% 10.5% 35.1%/(f)/
2004/(D)/ 2003 2002 2001/(G)/
---- ---- ---- ----
PRINCIPAL PARTNERS LARGECAP VALUE FUND, INC.
- --------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $10.78 $8.79 $9.92 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. -- 0.01 (0.01) (0.02)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.69 1.98 (1.03) (0.06)
---- ---- ----- -----
Total From Investment
Operations 0.69 1.99 (1.04) (0.08)
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- (0.09) --
----- -----
Total Dividends and
Distributions -- -- (0.09) --
----- -----
Net Asset Value, End
of Period............ $11.47 $10.78 $8.79 $9.92
====== ====== ===== =====
Total Return /(b)/ ... 6.40%/(e)/ 22.64% (10.62)% (0.80)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $16,138 $13,196 $7,439 $2,786
Ratio of Expenses to
Average Net Assets.. 2.21%/(f)/ 2.48% 2.70% 2.70%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.23%/(f)/ 2.51% 2.71% 2.82%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (0.02)%/(f)/ 0.06% (0.35)% (0.33)%/(f)/
Portfolio Turnover
Rate................ 24.7%/(f)/ 18.5% 10.5% 35.1%/(f)/
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. Expense limits for each class were decreased on March 1, 2003
/ /and March 1, 2004./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
/(g) //Period from December 22, 2000, date shares first offered, through October
31, 2001./
See accompanying notes.
161
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000/(G)/
---- ---- ---- ---- ----
PRINCIPAL PARTNERS MIDCAP GROWTH FUND, INC.
- -------------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $5.07 $3.61 $4.55 $9.09 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.04) (0.07) (0.08) (0.10) (0.04)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.02 1.53 (0.86) (4.44) (0.87)
---- ---- ----- ----- -----
Total From Investment
Operations (0.02) 1.46 (0.94) (4.54) (0.91)
----- ---- ----- ----- -----
Net Asset Value, End
of Period............ $5.05 $5.07 $3.61 $4.55 $9.09
===== ===== ===== ===== =====
Total Return /(b)/ ... (0.39)%/(e)/ 40.44% (20.66)% (49.94)% (12.68)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $22,539 $22,206 $12,745 $11,207 $11,875
Ratio of Expenses to
Average Net Assets.. 1.80%/(f)/ 1.95% 1.95% 1.95% 1.79%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.91%/(f)/ 2.39% 2.40% 2.67% 2.50%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (1.55)%/(f)/ (1.72)% (1.74)% (1.64)% (1.40)%/(f)/
Portfolio Turnover
Rate................ 164.4%/(f)/ 175.6% 234.9% 334.0% 265.5%/(f)/
2004/(D)/ 2003 2002 2001 2000/(G)/
---- ---- ---- ---- ----
PRINCIPAL PARTNERS MIDCAP GROWTH FUND, INC.
- -------------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $4.97 $3.54 $4.49 $9.04 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.06) (0.10) (0.08) (0.08) (0.07)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.02 1.53 (0.87) (4.47) (0.89)
---- ---- ----- ----- -----
Total From Investment
Operations (0.04) 1.43 (0.95) (4.55) (0.96)
----- ---- ----- ----- -----
Net Asset Value, End
of Period............ $4.93 $4.97 $3.54 $4.49 $9.04
===== ===== ===== ===== =====
Total Return /(b)/ ... (0.80)%/(e)/ 40.40% (21.16)% (50.33)% (13.16)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $9,283 $8,528 $4,160 $3,967 $4,093
Ratio of Expenses to
Average Net Assets.. 2.54%/(f)/ 2.70% 2.70% 2.70% 2.54%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.63%/(f)/ 3.17% 3.32% 3.45% 3.22%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (2.29)%/(f)/ (2.47)% (2.49)% (2.40)% (2.18)%/(f)/
Portfolio Turnover
Rate................ 164.4%/(f)/ 175.6% 234.9% 334.0% 265.5%/(f)/
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The expense limit began on the first day of the period ended /
/October 31, 2000. The expense limits for each class were increased on
November 1, 2000 and deceased on March 1, 2004./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
/(g) //Period from March 1, 2000, date shares first offered, through October 31,
2000./
See accompanying notes.
162
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001/(G)/
---- ---- ---- ----
PRINCIPAL PARTNERS SMALLCAP
- ---------------------------
GROWTH FUND, INC.
- -----------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $5.43 $3.99 $6.24 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.05) (0.07) (0.08) (0.07)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.10) 1.51 (2.17) (3.69)
----- ---- ----- -----
Total From Investment
Operations (0.15) 1.44 (2.25) (3.76)
----- ---- ----- -----
Net Asset Value, End
of Period............ $5.28 $5.43 $3.99 $6.24
===== ===== ===== =====
Total Return /(b)/ ... (2.76)%/(e)/ 36.09% (36.06)% (37.60)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $12,061 $10,108 $4,899 $4,107
Ratio of Expenses to
Average Net Assets.. 1.95%/(f)/ 1.95% 1.95% 1.95%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.14%/(f)/ 2.88% 2.95% 2.94%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (1.68)%/(f)/ (1.59)% (1.69)% (1.55)%/(f)/
Portfolio Turnover
Rate................ 69.3%/(f)/ 72.2% 303.3% 144.5%/(f)/
2004/(D)/ 2003 2002 2001/(G)/
---- ---- ---- ----
PRINCIPAL PARTNERS SMALLCAP
- ---------------------------
GROWTH FUND, INC.
- -----------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $5.31 $3.93 $6.20 $10.00
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.07) (0.10) (0.08) (0.11)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.09) 1.48 (2.19) (3.69)
----- ---- ----- -----
Total From Investment
Operations (0.16) 1.38 (2.27) (3.80)
----- ---- ----- -----
Net Asset Value, End
of Period............ $5.15 $5.31 $3.93 $6.20
===== ===== ===== =====
Total Return /(b)/ ... (3.01)%/(e)/ 35.11% (36.61)% (38.00)%/(e)/
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $5,533 $4,402 $1,579 $1,230
Ratio of Expenses to
Average Net Assets.. 2.70%/(f)/ 2.70% 2.70% 2.70%/(f)/
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.89%/(f)/ 3.76% 3.98% 3.82%/(f)/
Ratio of Net
Investment Income to
Average Net Assets.. (2.43)%/(f)/ (2.34)% (2.43)% (2.29)%/(f)/
Portfolio Turnover
Rate................ 69.3%/(f)/ 72.2% 303.3% 144.5%/(f)/
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
/(g) //Period from December 22, 2000, date shares first offered, through October
31, 2001./
See accompanying notes.
163
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL REAL ESTATE SECURITIES FUND, INC.
- -------------------------------------------
CLASS A SHARES /(A)/
- --------------------
Net Asset Value,
Beginning of Period.. $13.06 $10.03 $9.45 $9.03 $7.73 $8.39
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(b)/ .............. 0.11 0.34 0.30 0.34 0.35 0.31
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.31 3.01 0.57 0.42 1.30 (0.67)
---- ---- ---- ---- ---- -----
Total From Investment
Operations 0.42 3.35 0.87 0.76 1.65 (0.36)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.16) (0.32) (0.29) (0.34) (0.35) (0.30)
Distributions from
Realized Gains...... (0.22) -- -- -- -- --
----- -----
Total Dividends and
Distributions (0.38) (0.32) (0.29) (0.34) (0.35) (0.30)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $13.10 $13.06 $10.03 $9.45 $9.03 $7.73
====== ====== ====== ===== ===== =====
Total Return /(c)/ ... 3.10%/(f)/ 34.00% 9.13% 8.49% 21.86% (4.38)%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $44,775 $46,131 $29,198 $12,700 $9,439 $6,459
Ratio of Expenses to
Average Net Assets.. 1.62%/(g)/ 1.82% 1.76% 1.97% 1.88% 2.19%
Ratio of Gross
Expenses to Average
Net Assets /(d)/ ... 1.63%/(g)/ -- -- -- 2.17% --
Ratio of Net
Investment Income to
Average Net Assets.. 1.63%/(g)/ 3.05% 2.87% 3.57% 4.28% 3.77%
Portfolio Turnover
Rate................ 106.2%/(g)/ 58.4% 65.4% 69.5% 79.8% 55.1%
2004/(E)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL REAL ESTATE SECURITIES FUND, INC.
- -------------------------------------------
CLASS B SHARES /(A)/
- --------------------
Net Asset Value,
Beginning of Period.. $12.98 $9.98 $9.41 $9.00 $7.71 $8.38
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(b)/ .............. 0.07 0.26 0.23 0.28 0.30 0.24
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.30 2.98 0.57 0.42 1.29 (0.66)
---- ---- ---- ---- ---- -----
Total From Investment
Operations 0.37 3.24 0.80 0.70 1.59 (0.42)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.11) (0.24) (0.23) (0.29) (0.30) (0.25)
Distributions from
Realized Gains...... (0.22) -- -- -- -- --
----- -----
Total Dividends and
Distributions (0.33) (0.24) (0.23) (0.29) (0.30) (0.25)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $13.02 $12.98 $9.98 $9.41 $9.00 $7.71
====== ====== ===== ===== ===== =====
Total Return /(c)/ ... 2.80%/(f)/ 32.95% 8.38% 7.76% 21.00% (5.10)%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $13,628 $15,232 $8,982 $5,663 $4,488 $3,351
Ratio of Expenses to
Average Net Assets.. 2.30%/(g)/ 2.51% 2.47% 2.58% 2.62% 2.98%
Ratio of Gross
Expenses to Average
Net Assets /(d)/ ... 2.31%/(g)/ -- -- -- 2.75% --
Ratio of Net
Investment Income to
Average Net Assets.. 0.98%/(g)/ 2.34% 2.26% 2.97% 3.53% 2.98%
Portfolio Turnover
Rate................ 106.2%/(g)/ 58.4% 65.4% 69.5% 79.8% 55.1%
/(a) //Effective March 1, 2004, Principal Real Estate Fund, Inc. changed its
name to Principal Real Estate Securities Fund, Inc./
/(b) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(c) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(d) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The expense limit was effective for the year ended October 31,
/ /2000./
/(e) //Six months ended April 30, 2004./
/(f) //Total return amounts have not been annualized./
/(g) //Computed on an annualized basis./
See accompanying notes.
164
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL SMALLCAP FUND, INC.
- -----------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $8.28 $6.23 $7.60 $11.24 $11.34 $8.43
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.04) (0.06) (0.12) (0.11) (0.11) (0.11)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.45 2.11 (1.25) (1.91) 1.27 3.02
---- ---- ----- ----- ---- ----
Total From Investment
Operations 0.41 2.05 (1.37) (2.02) 1.16 2.91
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- (1.62) (1.26) --
---- ----- -----
Total Dividends and
Distributions -- -- -- (1.62) (1.26) --
---- ----- -----
Net Asset Value, End
of Period............ $8.69 $8.28 $6.23 $7.60 $11.24 $11.34
===== ===== ===== ===== ====== ======
Total Return /(b)/ ... 4.95%/(e)/ 32.91% (18.03)% (19.37)% 9.89% 34.52%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $79,339 $73,671 $56,334 $53,763 $60,660 $41,598
Ratio of Expenses to
Average Net Assets.. 1.71%/(f)/ 1.98% 1.94% 1.87% 1.75% 1.92%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 1.72%/(f)/ 1.98% 1.95% -- 1.76% --
Ratio of Net
Investment Income to
Average Net Assets.. (0.90)%/(f)/ (0.85)% (0.93)% (0.80)% (0.61)% (1.04)%
Portfolio Turnover
Rate................ 212.3%/(f)/ 165.6% 218.2% 154.9% 138.4% 100.7%
2004/(D)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL SMALLCAP FUND, INC.
- -----------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $7.90 $5.99 $7.36 $11.02 $11.21 $8.41
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. (0.07) (0.10) (0.09) (0.06) (0.10) (0.11)
Net Realized and
Unrealized Gain
(Loss) on
Investments......... 0.43 2.01 (1.28) (1.98) 1.17 2.91
---- ---- ----- ----- ---- ----
Total From Investment
Operations 0.36 1.91 (1.37) (2.04) 1.07 2.80
Less Dividends and
Distributions:
Distributions from
Realized Gains...... -- -- -- (1.62) (1.26) --
---- ----- -----
Total Dividends and
Distributions -- -- -- (1.62) (1.26) --
---- ----- -----
Net Asset Value, End
of Period............ $8.26 $7.90 $5.99 $7.36 $11.02 $11.21
===== ===== ===== ===== ====== ======
Total Return /(b)/ ... 4.56%/(e)/ 31.89% (18.61)% (20.05)% 9.14% 33.29%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $23,349 $22,036 $15,624 $17,342 $19,022 $14,158
Ratio of Expenses to
Average Net Assets.. 2.42%/(f)/ 2.70% 2.75% 2.74% 2.41% 2.63%
Ratio of Gross
Expenses to Average
Net Assets /(c)/ ... 2.43%/(f)/ 2.70% 2.75% -- 2.41% --
Ratio of Net
Investment Income to
Average Net Assets.. (1.61)%/(f)/ (1.58)% (1.73)% (1.67)% (1.27)% (1.75)%
Portfolio Turnover
Rate................ 212.3%/(f)/ 165.6% 218.2% 154.9% 138.4% 100.7%
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Expense ratio without fees paid indirectly and the Manager's voluntary
expense limit. The expense limit was effective for the year ended October 31,
/ /2000./
/(d) //Six months ended April 30, 2004./
/(e) //Total return amounts have not been annualized./
/(f) //Computed on an annualized basis./
See accompanying notes.
165
FINANCIAL HIGHLIGHTS
PRINCIPAL MUTUAL FUNDS
(UNAUDITED)
-------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH YEAR
ENDED OCTOBER 31 (EXCEPT AS NOTED):
2004/(C)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL TAX-EXEMPT BOND FUND, INC.
- ------------------------------------
CLASS A SHARES
- --------------
Net Asset Value,
Beginning of Period.. $12.31 $12.29 $12.10 $11.65 $11.69 $12.59
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.23 0.47 0.48/(f)/ 0.54 0.59 0.60
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.15) 0.05 0.18/(f)/ 0.51 0.06 (0.90)
----- ---- ---- ---- ---- -----
Total From Investment
Operations 0.08 0.52 0.66 1.05 0.65 (0.30)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.22) (0.45) (0.47) (0.55) (0.58) (0.59)
Distributions from
Realized Gains...... (0.03) (0.05) -- (0.05) (0.11) (0.01)
---- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.25) (0.50) (0.47) (0.60) (0.69) (0.60)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $12.14 $12.31 $12.29 $12.10 $11.65 $11.69
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.66%/(d)/ 4.25% 5.64% 9.28% 5.81% (2.51)%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $170,466 $178,379 $183,100 $167,016 $163,846 $186,973
Ratio of Expenses to
Average Net Assets.. 0.79%/(e)/ 0.81% 0.77% 0.82% 0.88% 0.80%
Ratio of Net
Investment Income to
Average Net Assets.. 3.68%/(e)/ 3.71% 4.02%/(f)/ 4.59% 5.12% 4.84%
Portfolio Turnover
Rate................ 59.7%/(e)/ 31.2% 60.0% 51.8% 7.6% 15.6%
2004/(C)/ 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ----
PRINCIPAL TAX-EXEMPT BOND FUND, INC.
- ------------------------------------
CLASS B SHARES
- --------------
Net Asset Value,
Beginning of Period.. $12.36 $12.32 $12.16 $11.71 $11.70 $12.59
Income from Investment
Operations:
Net Investment Income
(Operating Loss)
/(a)/ .............. 0.20 0.38 0.38/(g)/ 0.48 0.57 0.53
Net Realized and
Unrealized Gain
(Loss) on
Investments......... (0.15) 0.07 0.17/(g)/ 0.51 0.07 (0.89)
----- ---- ---- ---- ---- -----
Total From Investment
Operations 0.05 0.45 0.55 0.99 0.64 (0.36)
Less Dividends and
Distributions:
Dividends from Net
Investment Income... (0.19) (0.36) (0.39) (0.49) (0.52) (0.52)
Distributions from
Realized Gains...... (0.03) (0.05) -- (0.05) (0.11) (0.01)
---- ----- ----- ----- ----- -----
Total Dividends and
Distributions (0.22) (0.41) (0.39) (0.54) (0.63) (0.53)
----- ----- ----- ----- ----- -----
Net Asset Value, End
of Period............ $12.19 $12.36 $12.32 $12.16 $11.71 $11.70
====== ====== ====== ====== ====== ======
Total Return /(b)/ ... 0.35%/(d)/ 3.68% 4.67% 8.70% 5.69% (3.01)%
Ratio/Supplemental
Data:
Net Assets, End of
Period (in
thousands).......... $11,546 $13,254 $13,848 $12,122 $10,744 $11,480
Ratio of Expenses to
Average Net Assets.. 1.27%/(e)/ 1.44% 1.60% 1.33% 1.37% 1.32%
Ratio of Net
Investment Income to
Average Net Assets.. 3.21%/(e)/ 3.07% 3.19%/(g)/ 4.07% 4.60% 4.32%
Portfolio Turnover
Rate................ 59.7%/(e)/ 31.2% 60.0% 51.8% 7.6% 15.6%
/(a) //Effective November 1, 2002, calculated based on average shares
outstanding during the period./
/(b) //Total return is calculated without the front-end sales charge or
contingent deferred sales charge./
/(c) //Six months ended April 30, 2004./
/(d) //Total return amounts have not been annualized./
/(e) //Computed on an annualized basis./
/(f) //Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. There was no effect / /to
the Class A per share net investment income or net realized and unrealized
gain (loss) on investments for the year ended October 31, 2002. The ratio /
/of net investment income to average net assets increased by .06%. Prior
periods have not been restated to reflect this change in presentation./
/(g) //Effective November 1, 2001, the Fund adopted the provisions of the AICPA
Audit and Accounting Guide for Investment Companies. There was no effect / /to
the Class B per share net investment income or net realized and unrealized
gain (loss) on investments for the year ended October 31, 2002. The ratio /
/of net investment income to average net assets increased by .06%. Prior
periods have not been restated to reflect this change in presentation./
See accompanying notes.
166
FUND DIRECTORS
Under Maryland law, a Board of Directors oversees the Funds. The Directors have
financial or other relevant experience and meet several times during the year to
review contracts, Fund activities and the quality of services provided to the
Funds. Each director also has the same position with Principal Variable
Contracts Fund, Inc. and Principal Investors Fund, Inc. which are also sponsored
by Principal Life Insurance Company. Each director holds office for an
indefinite term. Directors considered to be "interested persons" as defined in
the Investment Company Act of 1940, as amended, as shown below are considered to
be interested because of an affiliation with the Manager and Principal Life
Insurance Company.
THE FOLLOWING DIRECTORS ARE CONSIDERED NOT TO BE "INTERESTED PERSONS" AS DEFINED
IN THE 1940 ACT .
NUMBER OF
PORTFOLIOS IN
FUND OTHER
COMPLEX DIRECTORSHIPS
NAME, POSITION HELD WITH THE FUND, PRINCIPAL OCCUPATION(S) OVERSEEN BY HELD BY
ADDRESS, AND DATE OF BIRTH DURING PAST 5 YEARS DIRECTOR DIRECTOR*
- ---------------------------------- ----------------------- ------------- -------------
92 None
James D. Davis
Director since 1974 Attorney. Vice
Member Audit and President, Deere and
Nominating Committee Company, Retired.
4940 Center Court,
Bettendorf, Iowa
03/22/34
92 None
Richard W. Gilbert
Director since 1985
Member Audit and President, Gilbert
Nominating Committee Communications, Inc.
5040 Arbor Lane, since 1993.
#302, Northfield,
Illinois.
05/08/40
92 None
Executive Vice
Mark A. Grimmett President and CFO,
Director since 2004 Merle Norman
Member Audit and Cosmetics, Inc.,
Nominating Committee since 2000. Prior
6310 Deerfield Avenue thereto, Vice
San Gabriel, President and CFO.
California
04/03/60
92
Casey's General
Stores, Inc.
William C. Kimball
Director since 1999 Chairman and CEO,
Member Audit and Medicap Pharmacies,
Nominating Committee Inc. Retired.
4350 Westown Parkway,
Suite 400
West Des Moines, Iowa
11/28/47
92 None
Barbara A. Lukavsky
Director since 1987
Member Audit and President and CEO,
Nominating Committee Barbican Enterprises,
Member Executive Inc. since 1997.
Committee
13731 Bay Hill Court,
Clive, Iowa
09/10/40
* Directorships of any company registered pursuant to Section 12 of the
Securities Exchange Act or subject to the requirements of Section 15(d) of
the Securities Exchange Act or any other mutual fund.
THE FOLLOWING DIRECTORS ARE CONSIDERED TO BE "INTERESTED PERSONS" AS DEFINED IN
THE 1940 ACT, AS AMENDED, BECAUSE OF AN AFFILIATION WITH THE MANAGER AND
PRINCIPAL LIFE. .
Director, Principal
Management
Corporation and
Princor Financial
Services Corporation
("Princor") since None
John E. Aschenbrenner 1998. President,
Director since 1998 Insurance and
08/16/49 Financial Services,
Principal Life since
2003. Executive Vice
President, 2000-2003.
Prior thereto, Senior
Vice President.
Director and
President, Princor
Ralph C. Eucher and Principal
Director and Management
President since 1999 Corporation, since None
Member Executive 1999. Senior Vice
Committee President, Principal
06/14/52 Life, since 2002.
Prior thereto, Vice
President.
Chairman and
Director, Princor and None
Larry D. Zimpleman Principal Management
Director and Chairman Corporation since
of the Board since 2002. President,
December 2001 Retirement and
Member Executive Investor Services,
Committee Principal Life since
09/07/51 2003. Executive Vice
President, 2001-2003.
Prior thereto, Senior
Vice President.
167
The Audit and Nominating Committee selects the independent auditors for the
Funds and oversees the activities of the independent auditors as well as the
internal auditors. The committee also receives reports about accounting and
financial matters affecting the Funds. In addition, the committee selects and
nominates all candidates who are not "interested persons" of the Funds for
election to the Board.
The Executive Committee is selected by the Board. It may exercise all the powers
of the Board, with certain exceptions, when the Board is not in session. The
Committee must report its actions to the Board.
Additional information about the Funds is available in the Prospectus and
Statement of Additional Information both dated March 1, 2004. These documents
may be obtained free of charge by writing or telephoning Princor Financial
Services Corporation, P.O. Box 10423, Des Moines, IA 50306. Telephone
1-800-247-4123.
PROXY VOTING POLICIES
A description of the policies and procedures the Funds use to determine how to
vote proxies relating to portfolio securities may be obtained free of charge by
telephoning Princor Financial Services Corporation at 1-800-247-4123 or at
www.sec.gov.
168
Item 2. Code of Ethics.
Not applicable to semi-annual reports.
Item 3. Audit Committee Financial Expert.
Not applicable to semi-annual reports.
Item 4. Principal Accountant Fees and Services.
Not applicable to semi-annual reports.
Item 5. Audit Committee of Listed Registrants
Not applicable.
Item 6. Schedule of Investments
Schedule of Investments is included as part of the Report to Shareholders filed
under Item 1 of this form
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Purchase of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers
Not applicable.
Item 9. Submission of Matters to a Vote of Security Holders
None
Item 10. Controls and Procedures.
(a) The registrant's principal executive officer and principal financial
officer have concluded that the registrant's disclosure controls and
procedures (as defined in Rule 30a-3(c) under the Investment Company Act
of 1940, as amended) are effective (such disclosure controls and
procedures having been evaluated within 90 days of the date of this
filing).
(b) There have been no changes in the registrant's internal controls over
financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR
270.30a-3(d)) that occurred during the registrant's last fiscal half-year
that has materially affected, or is reasonably likely to materially
affect, the registrant's internal control over financial reporting.
Item 11. Exhibits.
(a)(1) Code of Ethics - Not applicable to semi-annual reports.
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
attached hereto as Exhibit 99.CERT.
(b) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
attached hereto as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized in the City
of Des Moines and State of Iowa, on the 24th day of June, 2004.
Principal Equity Income Fund, Inc.
(Registrant)
/s/ Ralph C. Eucher
By _____________________________________
Ralph C. Eucher, President
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.
Signature Title Date
/s/ R. C. Eucher
_____________________________ President and Director June 24, 2004
R. C. Eucher _________________
/s/ Jill R. Brown
_____________________________ Vice President and June 24, 2004
J. R. Brown Chief Financial Officer _________________