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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 811-3254
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Strong Large Cap Growth Fund, Inc.
-------------------------------------------------------------
(Exact name of registrant as specified in charter)
P.O. Box 2936 Milwaukee, WI 53201
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(Address of principal executive offices) (Zip code)
Richard Smirl, Strong Capital Management, Inc.
P.O. Box 2936 Milwaukee, WI 53201
-------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (414) 359-3400
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Date of fiscal year end: December 31
----------------
Date of reporting period: June 30, 2003
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. (S) 3507.
Item 1. Reports to Stockholders
SEMIANNUAL REPORT | June 30, 2003
The Strong
Growth
Funds
[PHOTO APPEARS HERE]
Strong Blue Chip Fund
Strong Discovery Fund
Strong Endeavor Fund
Strong Large Cap Growth Fund
Strong Large Company Growth Fund
Strong U.S. Emerging Growth Fund
Strong Enterprise Fund
Strong Growth 20 Fund
Strong Growth Fund
[STRONG LOGO]
SEMIANNUAL REPORT | June 30, 2003
The Strong
Growth
Funds
Table of Contents
Investment Reviews
Strong Blue Chip Fund ..................................... 2
Strong Discovery Fund ..................................... 4
Strong Endeavor Fund ...................................... 6
Strong Large Cap Growth Fund .............................. 8
Strong Large Company Growth Fund ..........................10
Strong U.S. Emerging Growth Fund ..........................12
Strong Enterprise Fund ....................................14
Strong Growth 20 Fund .....................................16
Strong Growth Fund ........................................18
Financial Information
Schedules of Investments in Securities
Strong Blue Chip Fund ................................20
Strong Discovery Fund ................................20
Strong Endeavor Fund .................................23
Strong Large Cap Growth Fund .........................24
Strong Large Company Growth Fund .....................27
Strong U.S. Emerging Growth Fund .....................28
Strong Enterprise Fund ...............................30
Strong Growth 20 Fund ................................32
Strong Growth Fund ...................................33
Statements of Assets and Liabilities ......................36
Statements of Operations ..................................41
Statements of Changes in Net Assets .......................44
Notes to Financial Statements .............................47
Financial Highlights ...........................................61
Directors and Officers .........................................69
A Few Words From Dick Strong
- --------------------------------------------------------------------------------
[PHOTO APPEARS HERE]
Market Update--January 1 to June 30, 2003
In the early 1930s, politicians and policymakers in the United States and
elsewhere made a series of strategic errors that resulted in what historians
termed "an economic contraction." The rest of us call that period of horrible
human suffering and deprivation The Great Depression. When it finally ended,
those same politicians and economists vowed never to make the same mistakes
again.
In this country, seven decades later, the lessons of The Great Depression still
echo in our hearts and minds. Today, responding to weak economic growth and
fears of a possible severe slowdown, our government's economic policymakers have
employed almost every imaginable tool to spur economic growth. As the world's
biggest economy and the economic engine of the world, the U.S. has led the
way--but not alone. Other countries and regional economic authorities are
likewise moving to stimulate their economies.
The store of economic stimulants being brought to bear is unrivaled since World
War II. In the U.S. alone, we have witnessed massive government spending, with a
projected deficit larger than any in history. Monetary policy also has
contributed, pushing short-term interest rates to the lowest levels in more than
50 years. A weaker dollar aims to support manufacturing and export growth.
Changes in the tax laws on dividends and the evolving shift in corporate
compensation away from stock options to stock grants should meaningfully improve
corporate capital allocation.
History has demonstrated that it is dangerous to bet against the world's
governing bodies when they resolve to propel economic growth. Signs suggest that
we are in the beginning stages of a solid economic rebound. Early in such a
recovery phase, stocks and commodity prices usually rise, anticipating further
recovery. As additional signs of improvement emerge, consumer and business
confidence historically grows, and soon spending typically accelerates.
In the early stages of recovery, employment generally lags (usually 12-18
months) until employers gain confidence that such momentum will be sustained.
Because politicians are hypersensitive to employment numbers, they constantly
beat the drums of despair, when in reality hiring may be about to improve. And
so, it is not unusual to see more aggressive measures taken beyond the point
where a legitimate recovery is in place and employment is actually ready to
expand.
The strength of our economic system is that, beneath the bland economic
statistics reported daily, the system is always driving toward greater
efficiency and productivity. Those gains, in turn, inspire growth and create
wealth. The pressure and incentive for positive change is heightened during
downturns. Thus, our economy is often stronger
in the ensuing recovery. It is the combination of our political freedom and our
flexible economic system that has created the world's richest and most
productive country.
The change that our system creates and accommodates is astonishing. At the
beginning of the 20th century, 60 million Americans were employed in
agriculture. Today, that number has shrunk to an almost unbelievable 2.5 million
people. In the 1950s, 35% of Americans were employed in manufacturing; that
number has now fallen to 15%. Manufacturing supplanted farming as the country's
dominant employer and wealth generator. Now, the service and technology sectors
are taking their turn as the nation's leading economic sectors.
The changes under way in executive compensation and taxation of shareholder
dividends are important for all investors to understand. The use of stock grants
instead of stock options--that is, real money in place of pipe dreams and
gimmicks--should shore up the financial foundation of American corporations.
Likewise, the dividend tax law change should have far-reaching consequences. The
time-honored practice of companies returning part of their profits to
shareholders is a sound one. Issuing dividends will make corporate executives
more sensitive to downside risk as well as upside opportunity. The impact of
lower taxes on those dividends could be massive.
The United States and the rest of the world are in a consolidation phase
following the 1990s, a period that was--in every economic sense--abnormal. The
boom and the resultant bust scared and disoriented all of us. But we believe
that chapter is closing, and we are wiser for the lessons it taught us.
At the end of the day, there is a good chance that governmental growth
initiatives throughout the world will work. If they do, the world's economy will
recover, and we could reach a healthy 4%-plus real growth rate in 2004. The
current program of policy and tax changes should lay the foundation for job
growth and a sustained period of better economic times.
Investors should get on the right side of these trends by continuing to invest
using the appropriate combination of stocks and bonds, always consistent with
their long-term financial goals.
/s/ Dick
Strong Blue Chip Fund
================================================================================
Your Fund's Approach
The Strong Blue Chip Fund seeks total return by investing for capital growth
and income. The Fund invests, under normal conditions, at least 80% of its net
assets in blue chip companies. The Fund considers blue chip companies to be
companies whose stock is included in the Russell Top 200 Growth Index or
companies with a similar capitalization at the time of the Fund's investment.
The Fund focuses on companies its manager believes offers the potential for
capital growth. The Fund may utilize an active trading approach. The manager may
sell a holding when it no longer offers attractive growth prospects or to take
advantage of a better investment opportunity.
Growth of an Assumed $10,000 Investment+
From 6-30-97 to 6-30-03
[CHART APPEARS HERE]
The Strong Lipper Large-Cap
Blue Chip S&P 500 Growth Funds
Fund Index* Index*
Jun 97 $ 10,000 $ 10,000 $ 10,000
Dec 97 $ 10,872 $ 11,057 $ 10,932
Jun 98 $ 13,233 $ 13,015 $ 13,171
Dec 98 $ 15,647 $ 14,217 $ 14,920
Jun 99 $ 17,634 $ 15,977 $ 16,708
Dec 99 $ 21,730 $ 17,208 $ 20,115
Jun 00 $ 22,800 $ 17,136 $ 20,161
Dec 00 $ 17,695 $ 15,643 $ 16,156
Jun 01 $ 14,885 $ 14,596 $ 13,440
Dec 01 $ 13,207 $ 13,785 $ 12,300
Jun 02 $ 11,572 $ 11,972 $ 10,091
Dec 02 $ 9,211 $ 10,740 $ 8,842
Jun 03 $ 10,119 $ 12,002 $ 9,882
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
S&P 500 Index and the Lipper Large-Cap Growth Funds Index. Results include
the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares. The graph and the Average Annual Total Returns table do not
reflect the deduction of taxes, if any, that a shareholder would pay on
Fund distributions or the redemption of Fund shares.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
For the six months ended June 30, 2003, the Fund posted strong returns on an
absolute basis while moderately underperforming its broad-based benchmark, the
S&P 500 Index. The Fund generated a year-to-date return of 9.86% compared to the
S&P 500 Index, which generated a year-to-date return of 11.75% as of June 30,
2003. The Fund posted mild losses in the first quarter, when the markets and the
economy were stalled by concerns about the war with Iraq. In the second quarter,
the Fund posted strong returns as the war's quick resolution boosted investor
and consumer confidence.
Two very different quarters
The economy and markets started January on an optimistic note, but both quickly
fell as fears of the impact of war with Iraq consumed the minds of investors,
businesses, and consumers. In the uncertainty, businesses delayed spending and
made additional cutbacks in payroll, and consumer confidence weakened. Equities
reached their low point in mid-March, and returns in most sectors were negative.
In the second quarter, however, the progress of the coalition forces in Iraq
proved to be better than many expected, driving strong upward momentum in the
markets. The recovery was broad-based, with virtually every sector posting
positive returns. Newly restored confidence in America--not just in its military
strength but also in its economic power--drove this sea change in investor
sentiment. Continued monetary stimulus from the Federal Reserve and fiscal
stimulus in the
2
form of tax cuts from the President and Congress also helped to increase
optimism regarding the prospects for economic recovery.
As investors gained more confidence in the economy, they became willing to put
more money back into the equity markets--even though current economic news had
been mixed. This is consistent with a role the stock market has historically
played--as a leading indicator of economic growth.
Large-cap stocks performed more strongly in the early part of this rebound, from
mid-March through mid-April. At that point, investor sentiment and tolerance for
risk accelerated, which allowed small- and mid-cap stocks to outperform
large-cap stocks as reflected by the Russell 1000 Growth Index.
Expansion of our investment universe
In keeping with the Fund's focus on large-cap stocks, it performed most strongly
when large caps outperformed, and it lagged slightly as smaller stocks came to
the fore.
This spring we did expand the universe of stocks eligible for inclusion in the
Fund. While our focus remains firmly on large-cap, blue chip stocks, we now have
more companies from which to choose. We believe this change gives us the ability
to be both more flexible and more selective in constructing the portfolio. This
change contributed to our improved performance in May and June, and we believe
it will continue to do so over time.
The expanded universe of choices of stocks has not resulted in major changes in
the types of companies in which we invest. The overall sector weightings, for
example, remain quite similar, with healthcare and technology among the larger
sectors in our investment universe. Those two sectors, along with consumer
discretionary stocks, were the Fund's three heaviest-weighted sectors over the
six months.
Recovery appears likely to continue
Consumer-related sectors have led the recovery to date, with housing activity
and car sales both playing key roles in leading the economy out of recession.
Despite weak employment data, consumer spending fundamentals remain fairly
healthy and appear set to improve. Spending on housing and cars may slow, but
retail and services spending may very well increase to fill the void.
At this point, the manufacturing sector and corporate capital spending have
corrected to the point that they now seem set to provide a good base for
noninflationary growth for some time to come. While businesses may wait a little
longer before gaining full confidence and stepping up spending, we believe that
once the turn comes, it could progress more quickly than expected. The
cost-cutting measures that have been taking place over the past several years
could set the stage for profits to expand faster than revenues.
Despite recent gains, we believe price/earnings ratios for many stocks are still
very reasonable, particularly when adjusted to account for low interest rates.
We believe significant opportunities for further appreciation remain available
in a variety of sectors.
We appreciate your continued investment in the Strong Blue Chip Fund.
Karen E. McGrath
Portfolio Manager
Average Annual Total Returns
As of 6-30-03
Investor Class
- ----------------------------------------------
1-year -12.56%
3-year -23.72%
5-year -5.22%
Since Fund Inception 0.20%
(6-30-97)
Equity funds are volatile investments and should only be considered for
long-term goals.
From time to time, the Fund's advisor has waived its management fee and/or
absorbed Fund expenses, which has resulted in higher returns.
* The S&P 500 Index consists of 500 stocks chosen for market size, liquidity,
and industry group representation. It is a market value weighted index
(stock price times number of shares outstanding), with each stock's weight
in the Index proportionate to its market value. The Lipper Large-Cap Growth
Funds Index is the average of the 30 largest funds in the Lipper Large-Cap
Growth Funds Category. Source of the S&P index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
3
Strong Discovery Fund
================================================================================
Your Fund's Approach
The Strong Discovery Fund seeks capital growth. The Fund invests, under normal
conditions, in securities that its manager believes offer attractive
opportunities for growth. The Fund usually invests in a diversified portfolio of
common stocks from small- and medium-capitalization companies. These are chosen
through a combination of in-depth fundamental analysis of a company's financial
reports and direct, on-site research during company visits. Although the Fund
can invest in stocks of any economic sector, at times it may emphasize the
financial sector or other sectors. In addition, the Fund may utilize an active
trading approach. The manager may sell a holding if its growth potential or
fundamental qualities change.
Growth of an Assumed $10,000 Investment+
From 12-31-87 to 6-30-03
[CHART APPEARS HERE]
The Strong Lipper Mid-Cap
Discovery Russell 2000(R) Core Funds
Fund Index* Average*
Dec 87 $ 10,000 $ 10,000 $ 10,000
Dec 88 $ 12,445 $ 12,502 $ 12,025
Dec 89 $ 15,428 $ 14,535 $ 15,374
Dec 90 $ 15,005 $ 11,704 $ 14,054
Dec 91 $ 25,151 $ 17,093 $ 20,062
Dec 92 $ 25,639 $ 20,240 $ 22,792
Dec 93 $ 31,333 $ 24,061 $ 26,194
Dec 94 $ 29,553 $ 23,622 $ 25,612
Dec 95 $ 39,845 $ 30,343 $ 32,938
Dec 96 $ 40,439 $ 35,347 $ 39,614
Dec 97 $ 44,825 $ 43,252 $ 50,410
Dec 98 $ 47,981 $ 42,151 $ 55,178
Dec 99 $ 50,516 $ 51,111 $ 70,250
Dec 00 $ 52,520 $ 49,567 $ 78,216
Dec 01 $ 54,711 $ 50,799 $ 75,576
Dec 02 $ 48,078 $ 40,394 $ 61,729
Jun 03 $ 54,146 $ 47,616 $ 70,153
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Russell 2000(R) Index and the Lipper Mid-Cap Core Funds Average. Results
include the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares. The graph and the Average Annual Total Returns table do not
reflect the deduction of taxes, if any, that a shareholder would pay on
Fund distributions or the redemption of Fund shares.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
During the first six months of 2003, the Discovery Fund delivered its strongest
semiannual performance in several years on an absolute return basis. While the
Fund produced strong returns, it underperformed its broad-based benchmark, the
Russell 2000 Index. The Fund generated a year-to-date return of 12.62% compared
to the Russell 2000 Index, which generated a year-to-date return of 17.88% as of
June 30, 2003.
The Fund participated in the post-Iraq war stock market rally, though its bias
against lower-quality telecommunications and technology stocks contributed to
its underperformance. These companies benefited from a speculative run-up driven
by investors' increased appetite for risk in anticipation of an economic
recovery.
War influenced markets and sentiment
One of the most significant events during the first half of 2003 was the onset
and conclusion of major combat in Iraq. In the early part of the year, there was
much uncertainty as to whether the war would take place at all and, if so, how
long it might last. In such an environment, business leaders were unwilling to
make significant capital expenditures or to hire new employees. As a result, the
entire economy was in a holding pattern until the main thrust of the conflict
ended in mid-April.
When the major combat concluded, consumer sentiment soared upward, and the
market experienced an increase in speculative activity, with market participants
demonstrating a preference for riskier companies in the biotech, Internet,
communication, technology,
4
and cyclical sectors. As May progressed, however, actual evidence of an
improving economy failed to materialize. In response, interest rates began to
fall, which further fueled investor speculation, increasing demand for interest
rate-sensitive and highly leveraged companies. During this period the Fund
experienced most of its underperformance, as many of its investments were in
higher-quality companies positioned to benefit from an eventual turn in the
economy.
Other contributing factors to the strong equity market in May and June were the
announcements from Washington of a dividend tax cut, a corporate spending
stimulus package, and a Medicare drug benefit program.
Sectors driving performance
Early in the period, we had positioned the Fund with a significant
underweighting in technology stocks, as compared to the Russell 2500(TM) Growth
Index, in anticipation of a reversal of the speculative run-up many of these
stocks experienced in the fourth quarter of 2002. That reversal materialized in
late January and continued through March, during which time we accumulated
shares of what we considered to be among the highest-quality technology
companies--names we believed could rebound with the economy after the conclusion
of the conflict in Iraq.
We also reduced our energy exposure in early March, anticipating that energy
prices would fall from their record highs and, consequently, the stocks of oil
producers and oil service companies would underperform, relative to the Russell
2500 Growth Index. The eventual rebound of smaller, speculative technology
companies and the continuation of higher energy prices after the war made these
strategies less than optimal.
Also, compared to the Russell 2500 Growth Index, the Fund's exposure to
consumer-oriented companies made a significant, favorable contribution to
performance.
Our outlook for the months ahead
With the changes taking place across many industries in the U.S. economy, we
believe this may be one of the most exciting times for the stock market in
several years. Much of the recent optimism for an economic recovery rests on the
assumption that fiscal and monetary policies will be successful in stimulating
capital spending and increasing earnings growth.
From our perspective, the backdrop for economic growth and the resumption of
business spending will likely remain challenging, due to low interest rates and
an ample supply of capital chasing a limited number of investment opportunities.
However, it appears there are pockets of significant earnings growth
materializing on many different fronts. These are the result of technological
innovations, rationalization of cost structures, or industry consolidation.
In our view, this environment will require growth investors to identify
beneath-the-surface growth opportunities in industries such as technology,
biotechnology, energy, industrial cyclicals, and niche-oriented consumer goods.
We remain dedicated to identifying these investment opportunities as they emerge
in a select number of mid-cap and smaller-cap companies.
Thank you for your investment and continued confidence in the Strong Discovery
Fund.
Thomas J. Pence
Portfolio Manager
A note to shareholders
This period was marked by the untimely death of our dear friend and colleague,
Nicholas Truitt. Nick's accomplishments as Co-Manager of the Discovery Fund over
the past two volatile years were exemplary. His kind heart, warm laughter, and
exceptional intellect will be forever missed by me and my entire team.
Average Annual Total Returns
As of 6-30-03
- ----------------------------------------------
1-year 3.77%
3-year -1.29%
5-year 2.31%
10-year 7.34%
Since Fund Inception 11.51%
(12-31-87)
Equity funds are volatile investments and should only be considered for
long-term goals.
Because smaller companies often have narrower markets and limited financial
resources, investments in theses stocks present more risk than investments
in those of larger, more established companies.
* The Russell 2000(R) Index measures the performance of the 2,000 smallest
companies in the Russell 3000(R) Index, which represents approximately 8%
of the total market capitalization of the Russell 3000(R) Index. The Lipper
Mid-Cap Core Funds Average is the average of all funds in the Lipper
Mid-Cap Core Funds Category. Source of the Russell index data is Standard &
Poor's Micropal. Source of the Lipper index data is Lipper Inc.
5
Strong Endeavor Fund
================================================================================
Your Fund's Approach
The Strong Endeavor Fund seeks capital growth. The Fund focuses, under normal
conditions, on stocks (including common stocks and securities convertible into
common stocks) of companies that its managers believe have above-average
earnings growth prospects. The Fund invests primarily in large-capitalization
companies but also invests in small- and medium-capitalization companies. The
Fund's managers select companies that have attractive growth prospects (e.g.,
the potential for accelerated earnings growth because of management changes, new
products, or changes in the economy), accelerating sales and earnings, and
positive fundamentals (e.g., showing a growth trend or well-positioned in a
growth industry). The Fund may also invest up to 25% of its net assets in
foreign securities. In addition, the Fund may utilize an active trading
approach. The managers may sell a stock when the company's growth prospects
become less attractive or to take advantage of a better investment opportunity.
Growth of an Assumed $10,000 Investment+
From 4-6-01 to 6-30-03
[CHART APPEARS HERE]
The Strong Lipper Large-Cap
Endeavor S&P 500 Growth Funds
Fund Index* Index*
Mar 01 $ 10,000 $ 10,000 $ 10,000
Jun 01 $ 10,820 $ 10,880 $ 10,500
Sep 01 $ 9,050 $ 9,284 $ 8,414
Dec 01 $ 9,940 $ 10,276 $ 9,610
Mar 02 $ 9,450 $ 10,304 $ 9,366
Jun 02 $ 8,050 $ 8,924 $ 7,884
Sep 02 $ 6,870 $ 7,383 $ 6,621
Dec 02 $ 7,030 $ 8,005 $ 6,908
Mar 03 $ 6,980 $ 7,753 $ 6,802
Jun 03 $ 8,000 $ 8,946 $ 7,721
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with a similar investment in
the S&P 500 Index and the Lipper Large-Cap Growth Funds Index. Results
include the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or a loss when
you sell shares. The graph and the Average Annual Total Returns table do
not reflect the deduction of taxes, if any, that a shareholder would pay on
Fund distributions or the redemption of Fund shares.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
In the first half of 2003, the Endeavor Fund advanced significantly and
outperformed its broad-based index, the S&P 500 Index, as a result of individual
security selection. Positions in beaten-down stocks rallied nicely as the
period progressed. The Fund generated a year-to-date return of 13.80% compared
to the S&P 500 Index, which generated a year-to-date return of 11.75% as of June
30, 2003.
War played a large role over the period
One of the most significant events during the first half of 2003 was the onset
and conclusion of the major combat in Iraq. In the early part of the year, there
was much uncertainty as to whether the war would take place at all and, if so,
how long it might last. In such an environment, business leaders were unwilling
to make significant capital expenditures or to hire new employees. As a result,
the entire economy was in a holding pattern until the main thrust of the
conflict ended in mid-April.
When the initial combat showed signs of coming to an end, consumer sentiment
soared upward and the market experienced an increase in speculative activity,
with market participants demonstrating a preference for riskier companies in the
biotech, Internet, communication, technology, and cyclical sectors. As May
progressed, however, actual evidence of an improving economy failed to
materialize. In response, interest
6
rates began to fall, which further fueled investor speculation, increasing
demand for interest rate-sensitive and highly leveraged companies. During this
period the Fund experienced most of its underperformance relative to the
broad-based benchmark, as many of its investments were in higher-quality
companies positioned to benefit from an eventual turn in the economy.
Finding select opportunities in many sectors
Our continued focus on extensive bottom-up research allowed us to identify
several attractive investment opportunities for the Fund.
Our in-depth company and industry analysis led us to opportunities in some
larger, leading Internet and media companies that we believe have outstanding
growth prospects, strong business models, and solid near-term fundamentals.
Another research theme that contributed positively to the Fund's performance was
post-secondary education space, where we invested in for-profit education
providers and financers of student loans. Traditional media also provided us
with an attractive investment theme, as highlighted by our positions in large
multimedia stocks. Following the war in Iraq, these companies benefited from an
improvement in advertising rates and consumer sentiment.
We underweighted consumer staples and pharmaceuticals, in comparison to the
Russell 1000(R) Growth Index, based on our belief that these sectors did not
offer growth opportunities commensurate with their stocks' premium valuations.
It seemed to us that over the past few quarters many investors had been hiding
out in these two industries, which were perceived to be relatively safe; this
activity drove their valuations up to what we believed were unsustainable
levels.
Looking ahead to a changing environment
With the many changes taking place across many industries in the U.S. economy,
we believe this may be one of the most exciting times for the stock market in
several years. Much of the recent optimism for an economic recovery rests on the
implicit assumption that fiscal and monetary policies will be successful in
stimulating capital spending and increasing earnings growth.
From our perspective, the backdrop for economic growth and the resumption of
business spending will likely remain challenging, due to low interest rates and
an ample supply of capital chasing a limited number of investment opportunities.
However, it appears there are pockets of significant earnings growth
materializing on many different fronts.
These are the result of technological innovations, rationalization of cost
structures, or industry consolidation.
In our view, this environment will require growth investors to identify
beneath-the-surface growth opportunities in industries such as technology,
biotechnology, energy, industrial cyclicals, and niche-oriented consumer goods.
We remain dedicated to identifying these investment opportunities as they emerge
in a select number of mid-cap and smaller-cap companies.
Thank you for placing your confidence in the Strong Endeavor Fund.
Thomas J. Pence
Portfolio Co-Manager
D. Paul Berg
Portfolio Co-Manager
Average Annual Total Returns
As of 6-30-03
- ----------------------------------------------
1-year -0.62%
Since Fund Inception -9.51%
(4-6-01)
Equity funds are volatile investments and should only be considered for
long-term goals.
From time to time, the Fund's advisor and/or administrator has waived its
management fee and/or absorbed Fund expenses, which has resulted in higher
returns.
* The S&P 500 Index consists of 500 stocks chosen for market size, liquidity,
and industry group representation. It is a market value weighted index
(stock price times number of shares outstanding), with each stock's weight
in the Index proportionate to its market value. The Lipper Large-Cap Growth
Funds Index is the average of the 30 largest funds in the Lipper Large-Cap
Growth Funds Category. Source of the S&P index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
7
Strong Large Cap Growth Fund
================================================================================
Your Fund's Approach
The Strong Large Cap Growth Fund seeks capital growth. It invests, under normal
conditions, at least 80% of its assets in stocks of large-capitalization
companies that its manager believes offer the potential for capital growth.
Large-capitalization companies are defined as those companies with a market
capitalization substantially similar to that of companies in the S&P 500 Index*
at the time of investment. The Fund's manager seeks to identify companies that
have superior sales and earnings, enjoy a competitive advantage (e.g., dominant
market share), and have effective management (e.g., high return on invested
capital). Although the Fund can invest in stocks of any economic sector, at
times it may emphasize the consumer cyclicals, healthcare, technology, or other
sectors. The Fund may invest in derivative securities for nonspeculative
purposes (e.g., to manage investment risk, for liquidity, or to enhance the
Fund's return) and may utilize an active trading approach. The manager may
choose to sell a holding when it no longer offers attractive growth prospects or
to take advantage of a better investment opportunity.
Growth of an Assumed $10,000 Investment+
From 12-30-81 to 6-30-03
[CHART APPEARS HERE]
The Strong Lipper Large-Cap
Large Cap S&P 500 Growth Funds
Growth Fund Index* Index*
Dec 81 $ 10,000 $ 10,000 $ 10,000
Dec 82 $ 13,250 $ 12,155 $ 12,891
Dec 83 $ 18,720 $ 14,896 $ 15,808
Dec 84 $ 20,685 $ 15,831 $ 15,135
Dec 85 $ 25,936 $ 20,854 $ 20,107
Dec 86 $ 31,121 $ 24,747 $ 23,476
Dec 87 $ 33,002 $ 26,046 $ 24,258
Dec 88 $ 38,141 $ 30,360 $ 26,887
Dec 89 $ 39,140 $ 39,963 $ 35,572
Dec 90 $ 36,367 $ 38,721 $ 34,925
Dec 91 $ 48,578 $ 50,492 $ 47,967
Dec 92 $ 48,844 $ 54,334 $ 51,270
Dec 93 $ 59,851 $ 59,798 $ 56,735
Dec 94 $ 59,027 $ 60,584 $ 56,268
Dec 95 $ 74,963 $ 83,324 $ 75,916
Dec 96 $ 85,512 $ 102,443 $ 91,524
Dec 97 $ 106,181 $ 136,608 $ 116,777
Dec 98 $ 140,208 $ 175,645 $ 159,368
Dec 99 $ 223,975 $ 212,601 $ 214,856
Dec 00 $ 193,951 $ 193,263 $ 172,576
Dec 01 $ 131,366 $ 170,311 $ 131,385
Dec 02 $ 92,096 $ 132,685 $ 94,449
Jun 03 $ 104,647 $ 148,278 $ 105,556
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
S&P 500 Index and the Lipper Large-Cap Growth Funds Index. Results include
the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares. The graph and the Average Annual Total Returns table do not
reflect the deduction of taxes, if any, that a shareholder would pay on
Fund distributions or the redemption of Fund shares.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
The Strong Large Cap Growth Fund was up solidly in the first six months of 2003,
outperforming its broad-based benchmark index, the S&P 500 Index. The Fund
generated a year-to-date return of 13.63% compared to the S&P 500 Index, which
generated a year-to-date return of 11.75% as of June 30, 2003. The Fund
outperformed during the year's first quarter, a period when the broader market
declined slightly. In the second quarter, the market staged a strong rally, with
the Fund performing in line with the benchmark.
The market's tone changed dramatically
Stocks sold off early in 2003, as the uncertainty surrounding war with Iraq, a
continued sluggish economy, and weak earnings visibility gave investors little
reason for confidence. At that time, we positioned the Fund fairly defensively,
an approach that helped our relative and absolute performance in the period's
early months.
The market began a powerful rally in March, as it became clear that our
operations in Iraq would be relatively quick and successful. In addition, it
became apparent that Congress was willing to cut taxes significantly in an
effort to stimulate the U.S. economy. In this environment, we shifted our
tactics quickly, moving to a more aggressive posture to benefit from the
positive trend. The trifecta of historically low interest rates, a weakening
dollar that makes U.S.-produced goods more attractive to foreign markets, and
8
additional tax cuts are providing a great deal of stimulus to the U.S. economy.
This rush of liquidity was positive for stocks across the board, but it gave the
biggest boost to the riskiest and highest P/E stocks. These include stocks of
companies in the biotechnology, Internet, telecommunications, and technology
sectors, as well as many companies that had previously been on the brink of
bankruptcy.
Factors in the Fund's performance
The Fund's holdings in growth companies whose success is closely tied to the
improving economy helped investment performance in the second quarter,
particularly in April and May. In particular, the Fund overweighted technology,
media, and biotech companies for much of the period, while underweighting more
defensive sectors such as consumer staples as compared to the broad-based
benchmark.
Our investment decision-making continued to rely heavily on our hands-on,
intensive research process, seeking out those companies that are leaders in
their industries or have the potential to become one. We look for companies with
strong management teams, solid balance sheets, and sensible business models.
Attention to valuations remains an important element of our decision-making
process.
The outlook for growth investing
We continue to believe the environment for improving corporate profitability is
providing investors with significant opportunities. As we have in the past, we
continue to search out and invest in companies with strong competitive
advantages that can generate superior earnings and revenue growth. These stocks
don't lead the market every quarter, but we believe this can be a rewarding
long-term strategy.
We believe the current environment is very similar to that which prevailed in
the early 1960s, when low inflation, low interest rates, and moderate economic
growth combined to help produce a strong cyclical bull market. We will continue
to adhere to our active investment strategy emphasizing compelling investment
themes based on changing demographics, medical advances, and unit growth, which
we believe can lead us to sectors with the potential for superior growth over
time.
Thank you for your investment in the Strong Large Cap Growth Fund. We appreciate
the confidence you've placed in us.
Bruce C. Olson
Portfolio Manager
Average Annual Total Returns
As of 6-30-03
- ----------------------------------------------
1-year -2.09%
3-year -22.64%
5-year -3.29%
10-year 6.81%
Since Fund Inception 11.54%
(12-30-81)
Equity funds are volatile investments and should only be considered for
long-term goals.
* The S&P 500 Index consists of 500 stocks chosen for market size, liquidity,
and industry group representation. It is a market value weighted index
(stock price times number of shares outstanding), with each stock's weight
in the Index proportionate to its market value. The Lipper Large-Cap Growth
Funds Index is the average of the 30 largest funds in the Lipper Large-Cap
Growth Funds Category. Source of the S&P index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
9
Strong Large Company Growth Fund
================================================================================
Your Fund's Approach
The Strong Large Company Growth Fund seeks total return by investing for income
and capital growth. The Fund invests, under normal conditions, at least 80% of
its net assets in securities of approximately 50 large-capitalization companies
that its managers believe offer the potential for capital growth, consisting
primarily of income-producing equity securities. To identify stocks that offer
the opportunity for capital growth, the managers look for stocks that have a
record of growth in the areas of sales, earnings, or book value, and stocks that
have above-average returns on capital and equity. A proven management team and
business model are also evaluated to determine whether historic growth rates can
be replicated in the future. To select investments, the managers emphasize
capital appreciation and current yield. The Fund may also utilize an active
trading approach. The managers may choose to sell a holding when it no longer
offers attractive growth prospects or to take advantage of a better investment
opportunity.
Growth of an Assumed $10,000 Investment+
From 11-3-97 to 6-30-03
[CHART APPEARS HERE]
The Strong Lipper Large-Cap
Large Company S&P 500 Growth Funds
Growth Fund Index* Index*
Oct 97 $ 10,000 $ 10,000 $ 10,000
Dec 97 $ 10,106 $ 10,366 $ 10,339
Jun 98 $ 11,227 $ 12,201 $ 12,456
Dec 98 $ 11,605 $ 13,328 $ 14,110
Jun 99 $ 13,791 $ 14,978 $ 15,801
Dec 99 $ 17,657 $ 16,132 $ 19,023
Jun 00 $ 19,285 $ 16,064 $ 19,067
Dec 00 $ 18,248 $ 14,665 $ 15,280
Jun 01 $ 16,891 $ 13,683 $ 12,710
Dec 01 $ 16,610 $ 12,923 $ 11,633
Jun 02 $ 14,467 $ 11,224 $ 9,544
Dec 02 $ 13,605 $ 10,068 $ 8,362
Jun 03 $ 15,275 $ 11,251 $ 9,346
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
S&P 500 Index ("S&P 500") and the Lipper Large-Cap Growth Funds Index.
Results include the reinvestment of all dividends and capital gains
distributions. Performance is historical and does not represent future
results. Investment returns and principal value vary, and you may have a
gain or loss when you sell shares. The graph and the Average Annual Total
Returns table do not reflect the deduction of taxes, if any, that a
shareholder would pay on Fund distributions or the redemption of Fund
shares.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
The Fund began the year slightly behind its broad-based benchmark, the S&P 500
Index, as lower-quality stocks outperformed higher-quality issues.
As war with Iraq loomed on the horizon, however, investors sought more
conservative investments, allowing the Fund and its higher-quality names to
outperform. As a result, the Fund finished the first quarter slightly ahead of
its broad-based benchmark.
In the second quarter, however, as the war came to a quick resolution and
investors gained confidence in the prospects for economic recovery, stocks
staged a powerful rally, with riskier stocks once again taking the lead. This
left our returns slightly ahead those of our broad-based benchmark for the six
months. The Fund generated a year-to-date return of 12.27% compared to the S&P
500 Index, which generated a year-to-date return of 11.75% as of June 30, 2003.
All in all, it was a volatile but positive first half of the year.
An eventful six months
Three significant events took place during the first six months of 2003 that
were all positive for the stock market. First, the war with Iraq came to a
rather quick resolution; second, the Fed made a huge injection of liquidity into
the capital markets as it continued to battle deflation; and third, new tax
legislation was enacted that greatly benefits equity ownership. These were
clearly near-term positive events for the stock market and the Fund, but as is
so often the case, not all stocks react the same way at the same time.
10
The most immediate and dramatic beneficiaries of the Fed's action were all of
the companies that appeared to be priced for extinction. These
low-quality/low-priced stocks received a pardon of sorts, moving off of death
row and experiencing dramatic upward moves as it became obvious that they were
not going out of business--at least not yet. More volatile stocks, such as those
in the technology sector, did very well, as did some high-dividend payers
including companies in the utilities and telecommunications sectors.
The Fund's higher-quality orientation has served it very well over the past
couple of years, but during this lower-quality rally we have added some names
that are better positioned to participate in today's liquidity-driven
environment.
A disciplined investment approach
We believe that over time, the markets are very efficient allocators of capital.
That is, the best companies run by the best people with the best returns on
capital will eventually attract the capital. But in the real world, there are
also short-term periods of inefficiency. With this in mind, we have adopted a
very disciplined process to manage money on a year-to-year basis.
First, we like to keep the portfolio very nearly fully invested; second, we
generally keep our allocation to market sectors in line with those of the
Russell 1000(R) Growth Index; and third, we focus the bulk of our energies on
stock-picking. In selecting stocks, we look at the long term--that is,
identifying stocks that will attract capital over the long run. We also look at
stocks more likely to benefit over the short term--those that are attracting
capital today.
Sometimes, the long-run and short-run stocks are one and the same, but more
often than not, there are differences. Clearly this year so far is shaping up in
the latter profile, and during the first half of the year, we made some changes
to the portfolio to participate in the lower-quality rally. Of course, we also
kept significant positions in higher-quality companies more likely to perform
well in the long run.
Our outlook
Although the economy is still sluggish and geopolitical risks remain, for the
time being it appears that liquidity will continue to allow the market to rally.
The old Wall Street adage "Don't fight the Fed, and don't fight the tape"
appears to be holding true--especially when faced, as we are now, with massive
deficit spending, tax reductions, and a President campaigning for reelection. At
the moment, it appears that the direction of least resistance may be upward.
Thank you for your investment in the Strong Large Company Growth Fund.
Christopher H. Wiles
Portfolio Co-Manager
Lawrence E. Eakin, Jr.
Portfolio Co-Manager
Average Annual Total Returns
As of 6-30-03
- ----------------------------------------------
1-year/1/ 4.54%
3-year -7.48%
5-year 6.35%
Since Fund Inception 7.78%
(11-3-97)
Equity funds are volatile investments and should only be considered for
long-term goals.
From time to time, the Fund's advisor and/or administrator has waived its
management fee and/or absorbed Fund expenses, which has resulted in higher
returns.
The performance of the Fund prior to 9-16-02 is based on the performance of
the Rockhaven Premier Dividend Fund (the predecessor Fund) and does not
reflect the Fund's maximum sales charge of 5.75%, which was charged from
9-17-99 through 9-15-02.
/1/ Average annual total returns include a 1.00% redemption fee (as a
percentage of redemption proceeds) imposed on redemptions made within 12
months of purchase.
* The S&P 500 Index consists of 500 stocks chosen for market size, liquidity,
and industry group representation. It is a market value weighted index
(stock price times number of shares outstanding), with each stock's weight
in the Index proportionate to its market value. The Lipper Large-Cap Growth
Funds Index is the average of the 30 largest funds in the Lipper Large-Cap
Growth Funds Category. Source of the S&P 500 index data is Standard &
Poor's Micropal. Source of the Lipper index data is Lipper Inc.
11
Strong U.S. Emerging Growth Fund
================================================================================
Your Fund's Approach
The Strong U.S. Emerging Growth Fund seeks capital growth. The Fund invests,
under normal conditions, at least 80% of its net assets in stocks of U.S.
companies that appear to have relatively strong long-term growth potential in
revenues and profitability. The Fund generally invests in the stocks of small-
and medium-capitalization companies, although the Fund can invest in stocks of
any size. To identify these companies, the managers look for several
characteristics, including strong revenue growth, high return on invested
capital, overall financial strength, competitive advantages, reasonable current
stock price, effective management, and competence in research, development, and
marketing. Although the Fund can invest in stocks of any economic sector, at
times it may emphasize the technology sector or other sectors. The managers may
choose to sell a holding if its value becomes unattractive (e.g., when its
fundamental qualities deteriorate or when other investment opportunities exist
that have more attractive returns).
Growth of an Assumed $10,000 Investment+
From 12-31-98 to 6-30-03
[CHART APPEARS HERE]
The Strong Lipper Small-Cap
U.S. Emerging Russell 2000(R) Growth Funds
Growth Fund Index* Index*
Dec 98 $ 10,000 $ 10,000 $ 10,000
Mar 99 $ 12,080 $ 9,458 $ 9,675
Jun 99 $ 12,330 $ 10,928 $ 11,053
Sep 99 $ 13,000 $ 10,237 $ 11,253
Dec 99 $ 19,886 $ 12,126 $ 16,117
Mar 00 $ 24,038 $ 12,985 $ 19,003
Jun 00 $ 25,307 $ 12,494 $ 17,986
Sep 00 $ 24,393 $ 12,632 $ 17,702
Dec 00 $ 19,943 $ 11,759 $ 14,787
Mar 01 $ 15,085 $ 10,994 $ 11,996
Jun 01 $ 18,976 $ 12,565 $ 13,996
Sep 01 $ 12,494 $ 9,953 $ 10,493
Dec 01 $ 15,782 $ 12,052 $ 12,869
Mar 02 $ 14,731 $ 12,532 $ 12,683
Jun 02 $ 12,609 $ 11,485 $ 10,973
Sep 02 $ 10,549 $ 9,027 $ 8,833
Dec 02 $ 10,424 $ 9,583 $ 9,314
Mar 03 $ 10,081 $ 9,153 $ 8,967
Jun 03 $ 12,463 $ 11,297 $ 11,060
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Russell 2000(R) Index and the Lipper Small-Cap Growth Funds Index. Results
include the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares. The graph and the Average Annual Total Returns table do not
reflect the deduction of taxes, if any, that a shareholder would pay on
Fund distributions or the redemption of Fund shares.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
Over the six months ended June 30, 2003, the Fund performed in line with its
broad-based benchmark, the Russell 2000 Index. Volatility prevailed in the
year's first quarter, as daily mood swings over the impending and then
progressive war in Iraq overshadowed the markets. In the second quarter, as the
war concluded, the market began to rally. Consumer sentiment rebounded from very
depressed levels, and capital spending numbers are beginning to improve after
years of very poor results. These factors all contributed to a strong second
quarter for the Fund. As of June 30, 2003, the Fund generated a year-to-date
return of 19.56%.
Market turned in the second quarter
The war in Iraq was likely the most important event in the first half of 2003.
As consumer and business confidence plummeted in anticipation of the war, equity
markets languished. In this choppy environment, the market's direction was
dictated more by emotions than fundamentals.
With the quick resolution of the war in the second quarter, the markets began to
rebound, as investors turned their focus to the prospects for economic recovery.
The Federal Reserve's interest-rate cuts, coupled with aggressive fiscal
stimulus in the form of tax reductions, sparked investors' confidence in an
improving economy and helped to drive the markets strongly upward.
12
Over the first half of 2003, we saw a continuation of the yearlong trend of
growth stocks outperforming their value-oriented counterparts, as measured by
the Russell 2000(R) Growth Index.
Preparing for economic recovery
In November 2002, we repositioned the Fund to benefit from an environment of
improving business conditions and increasing consumer confidence. We anticipated
that the Federal Reserve would continue its efforts to stimulate the economy in
2003, as the Fed signaled concerns about deflation occurring in the United
States. Given the economy's overall weakness in the first quarter, however, this
positioning hurt our performance in the year's early months. In the second
quarter, however, as the economy showed signs of improvement and the markets
moved upward, our strategy had positive impact on fund returns.
Given our economic outlook, we added to the Fund's positions in those sectors
that have traditionally done well coming out of slow economic periods. These
include truckers, freight forwarders, restaurants, and technology. We also began
to add to our position in the energy sector.
After three years with almost no drilling activity, the numbers of active rigs
are beginning to move up. Further, we believe that given the very tight current
supply situation for natural gas, a new production cycle for that commodity may
be beginning.
We reduced our holdings in some of the more defensive stocks in our portfolio.
These positions were beneficial in more uncertain times, but such companies
historically have not participated as strongly in an economic recovery.
Our outlook for the months ahead
As the U.S. economy moves more decisively toward recovery, we believe that
corporate profits will exceed expectations over the remainder of 2003. The
improving economy, along with low interest rates, low inflation, and large
stockpiles of cash sitting on the investment sidelines, could all be positive
for the equity markets in general, and particularly for smaller-cap growth
stocks. In addition, we believe we are just about one year into a cycle of
growth stocks outperforming value based on total returns--as measured by the
Russell 2000 Growth Index--and these cycles have historically lasted three to
five years. We thus believe that there is potential for the environment for
growth investing to remain favorable for some time.
We thank you for your investment in the Strong U.S. Emerging Growth Fund.
Thomas L. Press
Portfolio Co-Manager
Donald M. Longlet
Portfolio Co-Manager
Robert E. Scott
Portfolio Co-Manager
Average Annual Total Returns
As of 6-30-03
- ----------------------------------------------
1-year -1.16%
3-year -21.03%
Since Fund Inception 5.02%
(12-31-98)
The Fund's return since inception was significantly enhanced through investments
in initial public offerings. You should not expect that such favorable returns
can be consistently achieved. Please consider this before investing.
Equity funds are volatile investments and should only be considered for
long-term goals.
From time to time, the Fund's advisor and/or administrator has waived its
management fee and/or absorbed Fund expenses, which has resulted in higher
returns.
Because smaller companies often have narrower markets and limited financial
resources, investments in these stocks present more risk than investments
in those of larger, more established companies.
* The Russell 2000(R) Index measures the performance of the 2,000 smallest
companies in the Russell 3000(R) Index, which represents approximately 8%
of the total market capitalization of the Russell 3000(R) Index. The Lipper
Small-Cap Growth Funds Index is the average of the 30 largest funds in the
Lipper Small-Cap Growth Funds Category. Source of the Russell index data is
Standard & Poor's Micropal. Source of the Lipper index data is Lipper Inc.
13
Strong Enterprise Fund
================================================================================
Your Fund's Approach
The Strong Enterprise Fund seeks capital growth. The Fund invests, under normal
conditions, in stocks of small- and medium-capitalization companies, though it
may invest in companies of any size. It focuses on companies that the manager
believes are positioned for rapid growth of revenue and earnings. The Fund's
manager strives to find leading companies in rapidly growing industries such as
business services, computer and digital products, financial services, healthcare
services, Internet-related companies, medical technology, retail, and
telecommunication. Companies that have the potential for accelerated earnings
growth because of management changes, new products, or changes in the economy
also may be attractive candidates for the portfolio. The Fund may also invest up
to 25% of its net assets in foreign securities. In addition, the Fund may
utilize an active trading approach. If there is a change in the company's growth
prospects or a deterioration in the company's fundamental qualities, the manager
may sell that company's stock.
Growth of an Assumed $10,000 Investment+
From 9-30-98 to 6-30-03
[CHART APPEARS HERE]
The Strong Russell Lipper Mid-Cap
Enterprise Midcap(R) Growth Funds
Fund Index* Index*
Sep 98 $ 10,000 $ 10,000 $ 10,000
Dec 98 $ 14,743 $ 11,844 $ 12,595
Mar 99 $ 17,255 $ 11,788 $ 13,062
Jun 99 $ 20,732 $ 13,068 $ 14,633
Sep 99 $ 24,777 $ 11,945 $ 14,779
Dec 99 $ 42,436 $ 14,003 $ 21,879
Mar 00 $ 48,127 $ 15,415 $ 25,000
Jun 00 $ 40,378 $ 14,720 $ 22,820
Sep 00 $ 39,360 $ 15,722 $ 23,545
Dec 00 $ 29,801 $ 15,158 $ 18,350
Mar 01 $ 23,435 $ 13,567 $ 14,132
Jun 01 $ 25,694 $ 14,861 $ 16,064
Sep 01 $ 19,916 $ 12,207 $ 12,151
Dec 01 $ 23,257 $ 14,306 $ 14,484
Mar 02 $ 22,794 $ 14,913 $ 14,071
Jun 02 $ 19,843 $ 13,489 $ 11,968
Sep 02 $ 16,639 $ 11,110 $ 9,895
Dec 02 $ 16,702 $ 11,990 $ 10,360
Mar 03 $ 16,513 $ 11,707 $ 10,193
Jun 03 $ 19,265 $ 13,845 $ 11,994
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
Russell Midcap(R) Index and the Lipper Mid-Cap Growth Funds Index. Results
include the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares. The graph and the Average Annual Total Returns table do not
reflect the deduction of taxes, if any, that a shareholder would pay on
Fund distributions or the redemption of Fund shares. This graph is based on
Investor Class shares only; performance for other classes will vary, due to
differences in fee structures.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
During the first six months of 2003, the Enterprise Fund delivered its strongest
six-month performance since 1999. The Fund rallied when the stock market sprang
back to life, as investors anticipated an improving economic environment after
the Iraq war. This enthusiasm eventually produced an increased appetite among
investors for riskier investments and a relatively speculative environment.
The Enterprise Fund slightly underperformed its broad-based benchmark, the
Russell Midcap Index. The Fund's preference for higher-quality technology and
energy companies, rather than smaller, more speculative investments, is largely
responsible for this relative performance.
War began and ended swiftly
One of the most significant events during the first half of 2003 was the onset
and conclusion of major combat in the war in Iraq. In the early part of the
year, there was much uncertainty as to whether the war would take place at all
and, if so, how long it might last. In such an environment, business leaders
were unwilling to make significant capital expenditures or to hire new
employees. As a result, the entire economy was in a holding pattern until the
main thrust of the conflict ended in mid-April.
As the war drew closer to an end, consumer sentiment soared upward, and the
market experienced an increase in speculative activity, with market participants
demonstrating a preference for riskier companies in the biotech, Internet,
communication, technology, and cyclical sectors. As May progressed, however,
actual evidence of an improving economy failed to materialize. In response,
interest rates began to fall, which further fueled investor
14
speculation, increasing demand for interest rate-sensitive and highly leveraged
companies. During this period the Fund experienced most of its underperformance,
as many of its investments were in higher-quality companies positioned to
benefit from an eventual turn in the economy.
Other contributing factors to the strong equity market in May and June were the
announcements out of Washington of a dividend tax cut, a corporate spending
stimulus package, and a Medicare drug benefit program.
Shifting market sentiment toward technology
Early in the year, we positioned the Fund with a significant underweighting in
technology, as compared to the Russell Midcap Growth Index. We adopted this
posture in anticipation of a reversal of the speculative run-up many of these
stocks had experienced in the fourth quarter of 2002. That reversal materialized
in late January and continued through March, during which time we accumulated
shares of the high-quality technology companies--names we believed would rebound
with the economy as the conflict in Iraq subsided. We also reduced our energy
exposure in early March, anticipating that energy prices would fall from their
record highs and that consequently, the stocks of oil producers and oil service
companies would underperform relative to the Russell Midcap Growth Index. The
eventual rebound of smaller, speculative technology companies and the
continuation of higher energy prices after the war made these strategies less
than optimal.
On the positive side, the Fund's overweighted position, relative to the Russell
Midcap Growth Index, in the automotive and transportation sectors performed well
during the period. In addition, tax cuts that were perceived as favorable to
businesses and consumers created a tailwind for our holdings in the advertising,
media, and retail sectors.
Seeking pockets of opportunity
With the many changes taking place across many industries in the U.S. economy,
we believe this may be one of the most exciting times for the stock market in
several years. Much of the recent optimism for an economic recovery rests on the
implicit assumption that fiscal and monetary policies will be successful in
stimulating capital spending and increasing earnings growth.
From our perspective, the backdrop for economic growth and the resumption of
business spending will likely remain challenging, due to low interest rates and
an ample supply of capital chasing a limited number of investment opportunities.
However, it appears there are pockets of significant earnings growth
materializing on many different fronts. These are the result of technological
innovations, rationalization of cost structures, or industry consolidation.
In our view, this environment will require growth investors to identify
beneath-the-surface growth opportunities in industries such as technology,
biotechnology, energy, industrial cyclicals, and niche-oriented consumer goods.
We remain dedicated to identifying these investment opportunities as they emerge
in a select number of mid-cap and smaller-cap companies.
Thank you for your investment in the Strong Enterprise Fund.
Thomas J. Pence
Portfolio Manager
Average Annual Total Returns
As of 6-30-03
Investor Class/1/
- ----------------------------------------------
1-year -2.91%
3-year -21.86%
Since Fund Inception 14.81%
(9-30-98)
Advisor Class/2/
- ----------------------------------------------
1-year -2.50%
3-year -21.87%
Since Fund Inception 14.68%
(9-30-98)
Class K/1/, /3/
- ----------------------------------------------
1-year -2.33%
3-year -21.70%
Since Fund Inception 14.95%
(9-30-98)
Equity funds are volatile investments and should only be considered for
long-term goals.
/1/ From time to time, the Fund's advisor and/or administrator has waived its
management fee and/or absorbed Fund expenses, which has resulted in higher
returns.
/2/ The performance of the Advisor Class shares prior to 2-24-00 is based on
the Fund's Investor Class shares' performance, restated for the higher
expense ratio of the Advisor Class shares. Please consult a prospectus for
information about all share classes.
/3/ The performance of Class K shares prior to 8-30-02 is based on the Fund's
Investor Class shares' performance. Please consult a prospectus for
information about all share classes.
Because smaller companies often have narrower markets and limited financial
resources, investments in these stocks present more risk than investments
in those of larger, more established companies.
* The Russell Midcap(R) Index measures the performance of the 800 smallest
companies in the Russell 1000(R) Index, which represent approximately 26%
of the total market capitalization of the Russell 1000(R) Index. The Lipper
Mid-Cap Growth Funds Index is the average of the 30 largest funds in the
Lipper Mid-Cap Growth Funds Category. Source of the Russell index data is
Standard & Poor's Micropal. Source of the Lipper index data is Lipper Inc.
15
Strong Growth 20 Fund
================================================================================
Your Fund's Approach
The Strong Growth 20 Fund seeks capital growth. The Fund focuses, under normal
conditions, on the stocks of 20 to 30 companies that its manager believes have
favorable prospects for superior growth of earnings but are selling at
reasonable valuations based on their earnings, cash flow, or asset value.
The portfolio can include stocks of any size. Although the Fund can invest
in stocks of any economic sector, at times it may emphasize the consumer
cyclicals, healthcare, and technology sectors or other sectors. The Fund may
invest in derivative securities for nonspeculative purposes (e.g., to manage
investment risk, for liquidity, or to enhance the Fund's return) and may utilize
an active trading approach. The manager may sell a stock when the company's
growth prospects become less attractive.
Growth of an Assumed $10,000 Investment+
From 6-30-97 to 6-30-03
[CHART APPEARS HERE]
The Strong Lipper Mid-Cap
Growth 20 S&P 500 Growth Funds
Fund Index* Index*
Jun 97 $ 10,000 $ 10,000 $ 10,000
Dec 97 $ 11,387 $ 11,057 $ 10,955
Jun 98 $ 13,129 $ 13,015 $ 12,789
Dec 98 $ 15,545 $ 14,217 $ 13,672
Jun 99 $ 18,891 $ 15,977 $ 15,626
Dec 99 $ 32,563 $ 17,208 $ 20,009
Jun 00 $ 35,646 $ 17,136 $ 21,489
Dec 00 $ 29,199 $ 15,643 $ 17,597
Jun 01 $ 19,973 $ 14,596 $ 14,999
Dec 01 $ 17,127 $ 13,785 $ 13,170
Jun 02 $ 14,152 $ 11,972 $ 10,518
Dec 02 $ 11,840 $ 10,740 $ 9,242
Jun 03 $ 13,165 $ 12,002 $ 10,687
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
S&P 500 Index and the Lipper Multi-Cap Growth Funds Index. Results include
the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares. The graph and the Average Annual Total Returns table do not
reflect the deduction of taxes, if any, that a shareholder would pay on
Fund distributions or the redemption of Fund shares. This graph is based on
Investor Class shares only; performance for other classes will vary, due to
differences in fee structures.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
For the first half of 2003, the Growth 20 Fund had solid absolute returns,
though its performance slightly lagged that of its broad-based benchmark, the
S&P 500 Index. The Fund outperformed during the first quarter, when the overall
market declined slightly, then performed more in line with--though below--the
broad-based benchmark during the second-quarter rally. The Fund generated a
year-to-date return of 11.19% compared to the S&P 500 Index, which generated a
year-to-date return of 11.75% as of June 30, 2003.
The market's tone shifted markedly
While we entered the year with a sense of cautious optimism, the beginning of
2003 saw a continuation of the worries that plagued the market over the
preceding three years, particularly concerns over the state of the economy and
the health of the U.S. consumer. Added to these was the uncertainty surrounding
the impending war with Iraq and other geopolitical tensions. Stocks sold off
early in the year in response to these factors.
In time, however, a positive reality began to offset these fears. When
first-quarter results came in, profit growth proved to be strong. The war in
Iraq was doing well. Compounding the impact of this good news were the continued
easing of interest
16
rates by the Federal Reserve, acceleration of income tax cuts, and reductions in
the tax rates on dividends and capital gains. A weaker U.S. dollar also helped
by making our goods more attractive in foreign markets. All together, these
conditions helped to spur a sweeping stock market rally, with virtually every
market sector producing solid, positive returns during the second quarter and
for the six months overall.
Factors in the Fund's performance
The top contributors to the Fund's performance were in the healthcare sector, an
area witnessing outstanding growth in revenue and earnings. Demographic trends
are doing much to support this sector, as an aging population demands more and
better health-related products and services. Other pockets of strength included
education and communications technology. The most significant areas of weakness
included retail and energy.
In making our investment decisions over the period, we continued to rely heavily
on our hands-on, research-intensive investment process, looking for those
companies that are leaders in their industries or have the potential to become
one. We seek out companies with strong management teams, solid balance sheets,
and sensible business models.
Our outlook for growth investing
We continue to believe the environment for improving corporate profitability is
providing investors with significant opportunities. As we have in the past, we
continue to search out and invest in companies with strong competitive
advantages that we believe can generate superior earnings and revenue growth.
These stocks don't lead the market every quarter, but we believe this is a
rewarding long-term strategy.
We believe the current environment is very similar to that which prevailed in
the early 1960s, when low inflation, low interest rates, and moderate economic
growth combined to help produce a strong cyclical bull market. We will continue
to adhere to our active investment strategy, emphasizing compelling investment
themes based on changing demographics, medical advances, and unit growth, which
we believe can lead us to sectors with the potential for superior growth over
time.
Thank you for your investment in the Strong Growth 20 Fund.
Brandon M. Nelson
Portfolio Manager
Average Annual Total Returns
As of 6-30-03
Investor Class
- ----------------------------------------------
1-year -6.98%
3-year -28.25%
5-year 0.05%
Since Fund Inception 4.69%
(6-30-97)
Advisor Class/1/
- ----------------------------------------------
1-year -6.67%
3-year -28.20%
5-year -0.01%
Since Fund Inception 4.59%
(6-30-97)
The Fund's return since inception was significantly enhanced through investments
in initial public offerings. You should not expect that such favorable returns
can be consistently achieved. Please consider this before investing.
Equity funds are volatile investments and should only be considered for
long-term goals.
From time to time, the Fund's advisor and/or administrator has waived its
management fee and/or absorbed Fund expenses, which has resulted in higher
returns.
/1/ The performance of the Advisor Class shares prior to 2-24-00 is based on
the Fund's Investor Class shares' performance, restated for the higher
expense ratio of the Advisor Class shares. Please consult a prospectus for
information about all share classes.
The Fund is nondiversified, meaning it may concentrate its assets in fewer
individual holdings than a diversified fund. Therefore, the Fund is more
exposed to individual stock volatility and market pressure than a fully
diversified fund.
* The S&P 500 Index consists of 500 stocks chosen for market size, liquidity,
and industry group representation. It is a market value weighted index
(stock price times number of shares outstanding), with each stock's weight
in the Index proportionate to its market value. The Lipper Multi-Cap Growth
Funds Index is the average of the 30 largest funds in the Lipper Multi-Cap
Growth Funds Category. Source of the S&P index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
17
Strong Growth Fund
================================================================================
Your Fund's Approach
The Strong Growth Fund seeks capital growth. The Fund focuses, under normal
conditions, on stocks of companies that its manager believes have favorable
prospects for superior growth of earnings but are selling at reasonable
valuations based on earnings, cash flow, or asset value. The portfolio can
include stocks of any size. Although the Fund can invest in stocks of any
economic sector, at times it may emphasize the consumer cyclicals, healthcare,
and technology sectors or other sectors. The Fund may invest in derivative
securities for nonspeculative purposes (e.g., to manage investment risk, for
liquidity, or to enhance the Fund's return) and may utilize an active trading
approach. The manager may sell a stock when the company's growth prospects
become less attractive.
Growth of an Assumed $10,000 Investment+
From 12-31-93 to 6-30-03
[CHART APPEARS HERE]
Lipper
The Strong Multi-Cap
Growth S&P 500 Growth Funds
Fund Index* Index*
Dec 93 $ 10,000 $ 10,000 $ 10,000
Dec 94 $ 11,727 $ 10,132 $ 9,718
Dec 95 $ 16,535 $ 13,934 $ 12,994
Dec 96 $ 19,763 $ 17,132 $ 15,314
Dec 97 $ 23,528 $ 22,845 $ 18,828
Dec 98 $ 29,877 $ 29,373 $ 23,497
Dec 99 $ 52,302 $ 35,553 $ 34,389
Dec 00 $ 47,473 $ 32,319 $ 30,244
Dec 01 $ 31,146 $ 28,481 $ 22,634
Dec 02 $ 23,271 $ 22,189 $ 15,884
Jun 03 $ 26,654 $ 24,797 $ 18,367
+ This graph, provided in accordance with SEC regulations, compares a $10,000
investment in the Fund, made at its inception, with the performance of the
S&P 500 Index and the Lipper Multi-Cap Growth Funds Index. Results include
the reinvestment of all dividends and capital gains distributions.
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you
sell shares. The graph and the Average Annual Total Returns table do not
reflect the deduction of taxes, if any, that a shareholder would pay on
Fund distributions or the redemption of Fund shares. This graph is based on
Investor Class shares only; performance for other classes will vary due to
differences in fee structures.
The Fund's prospectus and statement of additional information may describe
restrictions on the percentage of a particular type or quality of security
in which the Fund may invest ("Percentage Restrictions"). Percentage
Restrictions apply at the time the Fund purchases a security. Circumstances
subsequent to the purchase of the security, such as a change in: (1) the
Fund's assets (e.g., due to cash inflows and redemptions); (2) the market
value of the security; or (3) the pricing, liquidity, or rating of the
security, may cause the Fund to exceed or fall short of the Percentage
Restriction. If this happens, the Fund's continued holding of the security
will not constitute a violation of the Percentage Restriction.
The first half of 2003 was very much a tale of two quarters. In the first
quarter, results were essentially flat, as the markets first continued their
sell-off from late 2002, then began to rally toward the second half of March. In
the second quarter, however, the equity markets improved sharply, posting their
strongest quarter in years. In this environment, the Strong Growth Fund
outperformed its benchmark by generating a year-to-date return of 14.53%
compared to the S&P 500 Index return of 11.75% as of June 30, 2003.
A strong market rally
While we entered the year with a sense of cautious optimism, the beginning of
2003 saw a continuation of the worries that plagued the market over the
preceding three years, particularly concerns over the state of the economy and
the health of the U.S. consumer. Added to these was the uncertainty surrounding
the impending war with Iraq and other geopolitical tensions.
In time, however, a positive reality began to offset these fears. When
first-quarter results came in, profit growth proved to be strong. The war in
Iraq was successful and relatively short in duration.
Compounding the impact of this good news was continued easing of interest rates
by the Federal Reserve, acceleration of income tax cuts, and reductions in the
tax rates on dividends and capital gains.
Finally, improvement in the corporate bond market had significant impact on
equities as well; the tightening of yield spreads on corporate debt provided
companies with a significant opportunity to improve their balance sheets. Taken
all together, these factors helped to spur a sweeping stock market rally, with
virtually every market sector producing solid, positive returns.
18
Changes to the portfolio contributed to performance
The Fund entered 2003 fully invested, with an emphasis on companies and sectors
positioned to benefit most strongly from an improving economy. We had taken the
opportunity in late 2002 and early 2003 to reduce some of the Fund's weighting
in the consumer area, as we saw attractive opportunities to invest in growth
stocks in other sectors such as technology and healthcare.
We had also increased our allocation to energy-related stocks, as in our
assessment a very tight market for natural gas presented a good growth
opportunity for a number of companies. These changes made positive contributions
to our results in the first half of the year. Near the end of the six-month
period, we shifted some assets back to consumer stocks that we believe offer
superior growth prospects going forward.
In making all of these decisions, we relied heavily on our hands-on,
research-intensive investment process, seeking out those companies that are
leaders in their industries or have the potential to become one. We seek out
those companies with strong management teams, solid balance sheets, and sensible
business models. Attention to valuations remains an important element of our
decision-making process.
Our outlook
We continue to believe the environment for improving corporate profitability is
providing investors with significant opportunities. As we have in the past, we
continue to search out and invest in companies with strong competitive
advantages that can generate superior earnings and revenue growth. These stocks
don't lead the market every quarter, but we believe this can be a rewarding
long-term strategy.
We believe the current environment is very similar to that which prevailed in
the early 1960s, when low inflation, low interest rates, and moderate economic
growth combined to help produce a strong cyclical bull market. We will continue
to adhere to our active investment strategy, emphasizing compelling investment
themes based on changing demographics, medical advances, and unit growth, which
we believe can lead us to sectors with the potential for superior growth over
time.
Thank you for your investment in the Strong Growth Fund. We appreciate the
confidence you've continued to place in us.
Thomas C. Ognar
Portfolio Manager
Average Annual Total Returns
As of 6-30-03
Investor Class
- ----------------------------------------------
1-year 0.80%
3-year -22.25%
5-year -0.53%
Since Fund Inception 10.88%
(12-31-93)
Institutional Class/2/
- ----------------------------------------------
1-year 1.51%
3-year -21.69%
5-year -0.07%
Since Fund Inception 11.14%
(12-31-93)
Advisor Class/3/
- ----------------------------------------------
1-year 0.80%
3-year -22.35%
5-year -0.72%
Since Fund Inception 10.60%
(12-31-93)
Class C/1/, /4/
- ----------------------------------------------
1-year -1.01%
3-year -23.02%
5-year -1.60%
Since Fund Inception 9.62%
(12-31-93)
Class K/1/, /5/
- ----------------------------------------------
1-year 1.73%
3-year -22.01%
5-year -0.35%
Since Fund Inception 10.98%
(12-31-93)
Equity funds are volatile investments and should only be considered for
long-term goals.
/1/ From time to time, the Fund's advisor and/or administrator has waived its
management fee and/or absorbed Fund expenses, which has resulted in higher
returns.
/2/ The performance of the Institutional Class shares prior to 2-24-00 is based
on the Fund's Investor Class shares' performance. Please consult a
prospectus for information about all share classes.
/3/ The performance of the Advisor Class shares prior to 2-24-00 is based on
the Fund's Investor Class shares' performance, restated for the higher
expense ratio of the Advisor Class shares. Please consult a prospectus for
information about all share classes.
/4/ The performance of Class C shares prior to 12-26-02 is based on the Fund's
Investor Class shares' performance restated for the higher expense ratio of
the Class C shares. Please consult a prospectus for information about all
share classes. Average annual total returns include a 1.00% contingent
deferred sales charge imposed on redemptions made within 12 months of
purchase.
/5/ The performance of Class K shares prior to 8-30-02 is based on the Fund's
Investor Class shares' performance. Please consult a prospectus for
information about all share classes.
* The S&P 500 Index consists of 500 stocks chosen for market size, liquidity,
and industry group representation. It is a market value weighted index
(stock price times number of shares outstanding), with each stock's weight
in the Index proportionate to its market value. The Lipper Multi-Cap Growth
Funds Index is the average of the 30 largest funds in the Lipper Multi-Cap
Growth Funds Category. Source of the S&P index data is Standard & Poor's
Micropal. Source of the Lipper index data is Lipper Inc.
19
SCHEDULES OF INVESTMENTS IN SECURITIES June 30, 2003 (Unaudited)
- -------------------------------------------------------------------------------
STRONG BLUE CHIP FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 92.5%
Banks - Money Center 4.3%
Citigroup, Inc. 184,800 $ 7,909,440
Building - Resident/Commercial 10.2%
Centex Corporation 59,600 4,636,284
D.R. Horton, Inc. 176,700 4,965,270
Lennar Corporation Class A 69,800 4,990,700
Pulte Homes, Inc. 68,700 4,236,042
--------------
18,828,296
Computer - Local Networks 3.1%
Cisco Systems, Inc. (b) 343,600 5,734,684
Computer - Manufacturers 3.0%
Dell, Inc. (b) 175,300 5,602,588
Computer - Memory Devices 1.9%
EMC Corporation (b) 334,000 3,496,980
Computer Software - Desktop 3.3%
Microsoft Corporation 238,200 6,100,302
Computer Software - Enterprise 1.5%
Oracle Systems Corporation (b) 221,900 2,667,238
Diversified Operations 5.3%
AOL Time Warner, Inc. (b) 255,800 4,115,822
General Electric Company 197,500 5,664,300
--------------
9,780,122
Electronics - Semiconductor Manufacturing 4.5%
Analog Devices, Inc. (b) 137,000 4,770,340
Intel Corporation 168,900 3,510,418
--------------
8,280,758
Finance - Investment Brokers 4.8%
The Goldman Sachs Group, Inc. 67,600 5,661,500
Lehman Brothers Holdings, Inc. 48,100 3,197,688
--------------
8,859,188
Financial Services - Miscellaneous 3.0%
First Data Corporation 132,100 5,474,224
Food - Miscellaneous Preparation 2.1%
PepsiCo, Inc. 86,100 3,831,450
Insurance - Brokers 2.0%
Marsh & McLennan Companies, Inc. 71,400 3,646,398
Internet - E*Commerce 6.1%
eBay, Inc. (b) 53,900 5,615,302
InterActiveCorp (b) 141,300 5,591,241
--------------
11,206,543
Internet - Internet Service
Provider/Content 3.3%
Yahoo! Inc. (b) 186,300 6,103,188
Medical - Biomedical/Genetics 7.4%
Amgen, Inc. (b) 92,700 6,158,988
Gilead Sciences, Inc. (b) 71,900 3,996,202
Medimmune, Inc. (b) 91,800 3,338,766
--------------
13,493,956
Medical - Ethical Drugs 6.5%
Forest Laboratories, Inc. (b) 104,700 5,732,325
Pfizer, Inc. 182,000 6,215,300
--------------
11,947,625
Medical - Generic Drugs 3.1%
Teva Pharmaceutical Industries, Ltd. ADR 101,500 5,778,395
Medical - Products 4.3%
Boston Scientific Corporation (b) 72,700 4,441,970
St. Jude Medical, Inc. (b) 60,800 3,496,000
--------------
7,937,970
Medical - Wholesale
Drugs/Sundries 2.1%
AmerisourceBergen Corporation 54,100 3,751,835
Oil & Gas - Field Services 1.8%
Schlumberger, Ltd. 70,500 3,353,685
Oil & Gas - United States
Exploration & Production 1.0%
Burlington Resources, Inc. 32,000 1,730,240
Retail/Wholesale - Building
Products 2.6%
The Home Depot, Inc. 71,500 2,368,080
Lowe's Companies, Inc. 56,700 2,435,265
--------------
4,803,345
Telecommunications - Cellular 3.8%
Nextel Communications, Inc. Class A (b) 382,000 6,906,560
Tobacco - 1.5%
Altria Group, Inc. 61,500 2,794,560
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $150,006,192) 170,019,570
- -------------------------------------------------------------------------------
Short-Term Investments (a) 7.9%
Repurchase Agreements
ABN AMRO Inc. (Dated 6/30/03), 1.20%,
Due 7/01/03 (Repurchase proceeds
$13,100,437); Collateralized by: United
States Government & Agency Issues (c) $ 13,100,000 13,100,000
State Street Bank (Dated 6/30/03), 0.75%,
Due 7/01/03 (Repurchase proceeds
$1,476,031); Collateralized by: United
States Government & Agency Issues (c) 1,476,000 1,476,000
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $14,576,000) 14,576,000
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $164,582,192) 100.4% 184,595,570
Other Assets & Liabilities, Net (0.4%) (777,825)
- -------------------------------------------------------------------------------
Net Assets 100.0% $ 183,817,745
===============================================================================
STRONG DISCOVERY FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 98.5%
Auto/Truck - Original Equipment 1.2%
Eaton Corporation 22,300 $ 1,753,003
Banks - Northeast 1.2%
Mercantile Bankshares Corporation 43,515 1,713,621
20
- -------------------------------------------------------------------------------
STRONG DISCOVERY FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Beverages - Soft Drinks 0.7%
Cott Corporation (b) 49,390 $ 1,021,879
Building - Mobile/Manufacturers & RV 0.4%
Champion Enterprises, Inc. (b) 117,500 608,650
Chemicals - Fertilizers 0.7%
Agrium, Inc. 98,165 1,075,888
Commercial - Leasing Companies 0.6%
Ryder Systems, Inc. 32,900 842,898
Commercial Services - Advertising 1.6%
Lamar Advertising Company (b) 67,730 2,384,773
Commercial Services - Business
Services 0.7%
The Advisory Board Company (b) 26,700 1,081,884
Commercial Services - Miscellaneous 0.4%
Corporate Executive Board Company (b) 12,700 514,731
Commercial Services - Schools 1.4%
Career Education Corporation (b) 31,000 2,121,020
Commercial Services - Staffing 1.1%
kforce.com, Inc. (b) 400 1,932
Monster Worldwide, Inc. (b) 84,910 1,675,274
--------------
1,677,206
Computer - Integrated Systems 0.5%
Symbol Technologies, Inc. 53,500 696,035
Computer - Local Networks 1.0%
Juniper Networks, Inc. (b) 116,400 1,439,868
Computer Software - Desktop 0.8%
Adobe Systems, Inc. 37,460 1,201,342
Computer Software - Enterprise 1.9%
Mercury Interactive Corporation (b) 49,135 1,897,102
Siebel Systems, Inc. (b) 96,100 916,794
--------------
2,813,896
Computer Software - Financial 0.7%
Sungard Data Systems, Inc. (b) 40,400 1,046,764
Computer Software - Security 1.1%
Symantec Corporation (b) 36,670 1,608,346
Consumer Products - Miscellaneous 0.5%
Select Comfort Corporation (b) 43,600 717,220
Diversified Operations 1.8%
Alleghany Corporation (b) 8,423 1,608,793
Wesco Financial Corporation 3,481 1,086,072
--------------
2,694,865
Electrical - Equipment 0.8%
Regal-Beloit Corporation 57,460 1,097,486
Electronics - Semiconductor
Equipment 3.9%
ChipPAC, Inc. Class A (b) 204,200 1,566,214
Cymer, Inc. (b) 34,900 1,101,444
KLA-Tencor Corporation (b) 48,750 2,266,388
Novellus Systems, Inc. (b) 20,600 754,393
--------------
5,688,439
Electronics - Semiconductor
Manufacturing 5.6%
Altera Corporation (b) 81,400 1,334,960
Applied Micro Circuits Corporation (b) 144,500 874,225
Intersil Holding Corporation Class A (b) 73,600 1,958,496
Microchip Technology, Inc. 44,250 1,089,877
Micron Technology, Inc. (b) 73,700 857,131
Semtech Corporation (b) 74,800 1,065,152
Xilinx, Inc. (b) 40,900 1,035,179
--------------
8,215,020
Finance - Consumer/Commercial Loans 0.5%
Providian Financial Corporation (b) 73,500 680,610
Finance - Equity REIT 0.5%
Vornado Realty Trust 16,975 740,110
Finance - Investment Brokers 1.0%
Legg Mason, Inc. 21,500 1,396,425
Finance - Investment Management 1.6%
Neuberger Berman, Inc. 42,100 1,680,211
SEI Investments Company 19,210 614,720
--------------
2,294,931
Finance - Publicly Traded Investment
Funds-Equity (Non 40 Act) 0.0%
Biotech Holders Trust 70 8,628
Financial Services - Miscellaneous 0.9%
Investors Financial Services Corporation 42,800 1,241,628
Food - Meat Products 0.2%
Seaboard Corporation 1,177 243,639
Household - Audio/Video 0.7%
Harman International Industries, Inc. 12,155 961,947
Household - Office Furniture 0.2%
Furniture Brands International, Inc. (b) 13,800 360,180
Insurance - Property/Casualty/Title 1.5%
Erie Indemnity Company Class A 16,900 697,125
White Mountains Insurance Group, Ltd. 3,650 1,441,750
--------------
2,138,875
Internet - E*Commerce 1.0%
Priceline.com, Inc. (b) 62,338 1,391,392
Internet - Software 0.8%
BEA Systems, Inc. (b) 103,520 1,124,227
Leisure - Gaming 0.7%
Harrah's Entertainment, Inc. (b) 25,430 1,023,303
Leisure - Hotels & Motels 1.9%
Hilton Hotels Corporation 105,120 1,344,485
Starwood Hotels & Resorts Worldwide, Inc. 50,800 1,452,372
--------------
2,796,857
Leisure - Movies & Related 0.8%
Regal Entertainment Group Class A 52,100 1,228,518
21
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 2003 (Unaudited)
- -------------------------------------------------------------------------------
STRONG DISCOVERY FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Leisure - Services 3.5%
International Speedway Corporation Class A 26,800 $ 1,058,868
Royal Caribbean Cruises, Ltd. 137,630 3,187,511
Vail Resorts, Inc. (b) 63,640 857,231
--------------
5,103,610
Leisure - Toys/Games/Hobby 0.7%
Leapfrog Enterprises, Inc. Class A (b) 34,100 1,084,721
Machinery - Construction/Mining 1.2%
JLG Industries, Inc. 124,800 848,640
Terex Corporation (b) 44,100 860,832
--------------
1,709,472
Machinery - General Industrial 2.0%
Sauer-Danfoss, Inc. 47,210 507,507
Tennant Company 22,500 826,875
UNOVA, Inc. (b) 145,300 1,612,830
--------------
2,947,212
Media - Newspapers 3.0%
Lee Enterprises, Inc. 29,850 1,120,271
The E.W. Scripps Company Class A 37,455 3,323,008
--------------
4,443,279
Media - Radio/TV 5.7%
Cox Radio, Inc. Class A (b) 18,200 420,602
Emmis Broadcasting Corporation Class A (b) 140,800 3,231,360
LIN TV Corporation (b) 61,470 1,447,618
Spanish Broadcasting System, Inc. Class A (b) 95,000 774,250
Univision Communications, Inc. Class A (b) 62,690 1,905,776
Westwood One, Inc. (b) 18,400 624,312
--------------
8,403,918
Medical - Biomedical/Genetics 5.4%
Amylin Pharmaceuticals, Inc. (b) 11,700 256,113
Digene Corporation (b) 28,600 778,778
Genzyme Corporation (b) 44,040 1,840,872
Gilead Sciences, Inc. (b) 18,410 1,023,228
IDEC Pharmaceuticals Corporation (b) 56,000 1,904,000
Millennium Pharmaceuticals, Inc. (b) 130,610 2,054,495
--------------
7,857,486
Medical - Ethical Drugs 1.5%
Medicis Pharmaceutical Corporation Class A 40,800 2,313,360
Medical - Generic Drugs 0.8%
Watson Pharmaceuticals, Inc. (b) 27,200 1,098,064
Medical - Health Maintenance
Organizations 1.0%
Mid Atlantic Medical Services, Inc. (b) 29,000 1,516,700
Medical - Hospitals 1.2%
Community Health Systems, Inc. (b) 93,760 1,821,757
Medical - Products 3.4%
C.R. Bard, Inc. 26,500 1,889,715
Edwards Lifesciences Corporation (b) 23,300 748,862
INAMED Corporation (b) 20,700 1,111,383
Viasys Healthcare, Inc. (b) 4,000 82,800
Zimmer Holdings, Inc. (b) 26,900 1,211,845
--------------
5,044,605
Medical - Wholesale Drugs/Sundries 0.5%
AmerisourceBergen Corporation 11,570 802,380
Medical/Dental - Services 0.4%
Caremark Rx, Inc. (b) 20,500 526,440
Medical/Dental - Supplies 1.5%
Dentsply International, Inc. 53,400 2,184,060
Metal Ores - Gold/Silver 0.7%
Apex Silver Mines, Ltd. (b) 64,671 953,897
Mining - Gems 0.4%
Pan American Silver Corporation (b) 83,143 586,158
Oil & Gas - Drilling 2.5%
GlobalSantaFe Corporation 38,700 903,258
Nabors Industries, Ltd. (b) 26,440 1,045,702
Patterson Utility Energy, Inc. (b) 29,000 939,600
Transocean, Inc. (b) 35,800 786,526
--------------
3,675,086
Oil & Gas - Machinery/Equipment 1.7%
Grant Prideco, Inc. (b) 62,200 730,850
Weatherford International, Ltd. (b) 42,535 1,782,216
--------------
2,513,066
Oil & Gas - United States Exploration &
Production 1.2%
Pioneer Natural Resources Company (b) 30,470 795,267
XTO Energy, Inc. 47,500 955,225
--------------
1,750,492
Paper & Paper Products 0.9%
Domtar, Inc. (d) 116,090 1,282,795
Retail - Apparel/Shoe 5.8%
Abercrombie & Fitch Company Class A (b) 56,300 1,599,483
Coach, Inc. (b) 22,800 1,134,072
The Finish Line, Inc. Class A (b) 87,159 1,935,801
Gadzooks, Inc. (b) 118,893 675,312
Too, Inc. (b) 63,810 1,292,152
Urban Outfitters, Inc. (b) 50,700 1,820,130
--------------
8,456,950
Retail - Home Furnishings 0.5%
The Bombay Company, Inc. (b) 74,597 792,966
Retail - Miscellaneous/Diversified 1.2%
PETsMART, Inc. (b) 108,798 1,813,663
Retail - Restaurants 3.4%
O'Charley's, Inc. (b) 43,500 936,555
P.F. Chang's China Bistro, Inc. (b) 16,510 812,457
Panera Bread Company Class A (b) 59,120 2,364,800
Sonic Corporation (b) 35,600 905,308
--------------
5,019,120
Retail/Wholesale - Auto Parts 1.0%
CarMax, Inc. (b) 24,800 747,720
O'Reilly Automotive, Inc. (b) 22,200 741,258
--------------
1,488,978
Telecommunications - Equipment 2.9%
Adtran, Inc. (b) 14,950 766,786
Advanced Fibre Communications, Inc. (b) 69,840 1,136,297
Avaya, Inc. (b) 137,700 889,542
Corning, Inc. (b) 194,000 1,433,660
--------------
4,226,285
Transportation - Airline 1.4%
AirTran Holdings, Inc. (b) 156,900 1,642,743
Delta Air Lines, Inc. 26,400 387,552
--------------
2,030,295
Transportation - Truck 0.7%
Heartland Express, Inc. (b) 45,620 1,015,045
22
- -------------------------------------------------------------------------------
STRONG DISCOVERY FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Trucks & Parts - Heavy Duty 1.5%
Navistar International Corporation (b) 68,975 $ 2,250,654
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $132,265,859) 144,358,618
- -------------------------------------------------------------------------------
Short-Term Investments (a) 17.9%
Collateral Received for Securities
Lending (f) 9.3%
Money Market Funds 6.3%
Deutsche Daily Assets Fund -
Institutional Class 9,216,967 9,216,967
Repurchase Agreements 3.0%
Barclays Capital, Inc. (Dated 6/30/03),
1.23%, Due 7/01/03 (Repurchase
proceeds $1,466,563); Collateralized by:
United States Government &
Agency Issues $ 1,466,508 1,466,508
Goldman, Sachs and Company (Dated
6/30/03), 1.22%, Due 7/01/03
(Repurchase proceeds $1,466,558);
Collateralized by: United States
Government & Agency Issues 1,466,508 1,466,508
Lehman Brothers Inc. (Dated 6/30/03),
1.23%, Due 7/01/03 (Repurchase
proceeds $1,466,563); Collateralized by:
United States Government &
Agency Issues 1,466,508 1,466,508
--------------
4,399,524
--------------
Total Collateral Received for Securities
Lending 13,616,491
Repurchase Agreements 8.6%
ABN AMRO Inc. (Dated 6/30/03), 1.20%,
Due 7/01/03 (Repurchase proceeds
$10,600,353); Collateralized by: United
States Government & Agency Issues (c) 10,600,000 10,600,000
State Street Bank (Dated 6/30/03), 0.75%,
Due 7/01/03 (Repurchase proceeds
$2,038,842); Collateralized by: United
States Government & Agency Issues (c) 2,038,800 2,038,800
--------------
Total Repurchase Agreements 12,638,800
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $26,255,291) 26,255,291
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $158,521,150) 116.4% 170,613,909
Other Assets and Liabilities, Net (16.4%) (24,003,235)
- -------------------------------------------------------------------------------
Net Assets 100.0% $ 146,610,674
===============================================================================
STRONG ENDEAVOR FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 99.1%
Auto/Truck - Original Equipment 1.5%
Eaton Corporation 950 $ 74,680
Banks - Money Center 4.1%
Citigroup, Inc. 4,800 205,440
Beverages - Soft Drinks 2.0%
The Coca-Cola Company 2,145 99,549
Commercial Services - Advertising 0.5%
Lamar Advertising Company (b) 640 22,534
Commercial Services - Schools 1.0%
Apollo Group, Inc. Class A (b) 400 24,704
Career Education Corporation (b) 390 26,684
--------------
51,388
Computer - Local Networks 2.8%
Cisco Systems, Inc. (b) 8,515 142,115
Computer - Manufacturers 1.5%
Dell, Inc. (b) 2,370 75,745
Computer - Services 0.4%
International Business Machines Corporation 260 21,450
Computer Software - Desktop 3.5%
Microsoft Corporation 6,780 173,636
Computer Software -
Education/Entertainment 1.1%
Electronic Arts, Inc. (b) 770 56,972
Computer Software - Enterprise 4.9%
SAP AG Sponsored ADR 2,195 64,138
Siebel Systems, Inc. (b) 3,160 30,146
VERITAS Software Corporation (b) 5,300 151,951
--------------
246,235
Computer Software - Security 0.9%
Symantec Corporation (b) 1,050 46,053
Diversified Operations 10.2%
AOL Time Warner, Inc. (b) 16,165 260,095
Tyco International, Ltd. 13,175 250,061
--------------
510,156
Electronics - Semiconductor Equipment 0.7%
Applied Materials, Inc. (b) 2,250 35,685
Electronics - Semiconductor
Manufacturing 8.1%
Intel Corporation 10,520 218,648
Linear Technology Corporation 720 23,191
Maxim Integrated Products, Inc. 2,290 78,295
Microchip Technology, Inc. 2,520 62,068
Micron Technology, Inc. (b) 1,760 20,469
--------------
402,671
Finance - Consumer/Commercial Loans 1.0%
SLM Corporation 1,215 47,592
Finance - Investment Brokers 1.0%
Lehman Brothers Holdings, Inc. 760 50,525
Finance - Publicly Traded Investment Funds -
Equity (Non 40 Act) 2.1%
Biotech Holders Trust 230 28,348
Pharmaceutical Holders Trust 930 75,237
--------------
103,585
23
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 2003 (Unaudited)
- -------------------------------------------------------------------------------
STRONG ENDEAVOR FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Financial Services - Miscellaneous 3.1%
American Express Company 530 $ 22,159
First Data Corporation 3,225 133,644
--------------
155,803
Insurance - Diversified 2.1%
American International Group, Inc. 1,900 104,842
Internet - E*Commerce 2.3%
eBay, Inc. (b) 1,080 112,514
Internet - Internet Service
Provider/Content 2.7%
Yahoo! Inc. (b) 4,100 134,316
Leisure - Services 5.4%
The Walt Disney Company 3,465 68,434
Royal Caribbean Cruises, Ltd. 8,760 202,882
--------------
271,316
Media - Cable TV 0.7%
EchoStar Communications Corporation
Class A (b) 940 32,543
Media - Newspapers 2.1%
The E.W. Scripps Company Class A 1,185 105,133
Media - Radio/TV 2.5%
Univision Communications, Inc. Class A (b) 2,000 60,800
Viacom, Inc. Class B (b) 1,440 62,870
--------------
123,670
Medical - Biomedical/Genetics 3.7%
Amgen, Inc. (b) 1,350 89,694
Genzyme Corporation (b) 510 21,318
Gilead Sciences, Inc. (b) 440 24,455
IDEC Pharmaceuticals Corporation (b) 1,420 48,280
--------------
183,747
Medical - Drug/Diversified 1.3%
Johnson & Johnson 1,300 67,210
Medical - Ethical Drugs 7.2%
Medicis Pharmaceutical Corporation Class A 1,170 66,339
Merck & Company, Inc. 1,690 102,329
Pfizer, Inc. 5,544 189,328
--------------
357,996
Medical - Generic Drugs 1.3%
Teva Pharmaceutical Industries, Ltd. ADR 1,100 62,623
Medical - Health Maintenance
Organizations 1.1%
Anthem, Inc. (b) 730 56,320
Medical - Products 2.2%
Boston Scientific Corporation (b) 610 37,271
Medtronic, Inc. 1,560 74,833
--------------
112,104
Oil & Gas - Drilling 0.8%
Transocean, Inc. (b) 1,810 39,766
Oil & Gas - Field Services 0.5%
Schlumberger, Ltd. 505 24,023
Retail - Home Furnishings 0.3%
Bed Bath & Beyond, Inc. (b) 350 13,583
Retail - Major Discount Chains 1.2%
Target Corporation 1,535 58,084
Retail - Restaurants 1.8%
McDonald's Corporation 2,390 52,723
Panera Bread Company Class A (b) 950 38,000
--------------
90,723
Retail/Wholesale - Auto Parts 0.9%
AutoZone, Inc. (b) 590 44,822
Retail/Wholesale - Building Products 2.2%
The Home Depot, Inc. 1,630 53,986
Lowe's Companies, Inc. 1,250 53,688
--------------
107,674
Telecommunications - Equipment 5.4%
Alcatel SA ADR (b) 10,895 97,510
Corning, Inc. (b) 13,180 97,400
Nokia Corporation Sponsored ADR 4,385 72,046
--------------
266,956
Trucks & Parts - Heavy Duty 1.0%
Navistar International Corporation (b) 1,460 47,640
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $4,487,185) 4,939,419
- -------------------------------------------------------------------------------
Short-Term Investments (a) 1.3%
Repurchase Agreements
State Street Bank (Dated 6/30/03), 0.75%,
Due 7/01/03 (Repurchase proceeds $62,301);
Collateralized by: United States Government
& Agency Issues (c) $ 62,300 62,300
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $62,300) 62,300
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $4,549,485) 100.4% 5,001,719
Other Assets and Liabilities, Net (0.4%) (17,492)
- -------------------------------------------------------------------------------
Net Assets 100.0% $ 4,984,227
===============================================================================
STRONG LARGE CAP GROWTH FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 99.7%
Aerospace - Defense 0.5%
Lockheed Martin Corporation 65,000 $ 3,092,050
Banks - Money Center 3.1%
Bank of America Corporation 70,000 5,532,100
Citigroup, Inc. 240,000 10,272,000
J.P. Morgan Chase & Company 130,000 4,443,400
--------------
20,247,500
Beverages - Alcoholic 0.4%
Anheuser-Busch Companies, Inc. 50,000 2,552,500
Building - Construction
Products/Miscellaneous 0.1%
Masco Corporation 30,000 715,500
Chemicals - Basic 0.7%
The Dow Chemical Company 40,000 1,238,400
PPG Industries, Inc. 65,000 3,298,100
--------------
4,536,500
24
- -------------------------------------------------------------------------------
STRONG LARGE CAP GROWTH FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Chemicals - Specialty 0.1%
Praxair, Inc. 10,000 $ 601,000
Commercial Services - Advertising 1.3%
Omnicom Group, Inc. 115,000 8,245,500
Commercial Services - Miscellaneous 0.3%
Paychex, Inc. 75,000 2,198,250
Commercial Services - Schools 0.6%
Apollo Group, Inc. Class A (b) 65,000 4,014,400
Computer - Local Networks 4.8%
Cisco Systems, Inc. (b) 1,130,000 18,859,700
Juniper Networks, Inc. (b) 730,000 9,030,100
QLogic Corporation (b) 70,000 3,383,100
--------------
31,272,900
Computer - Manufacturers 2.6%
Dell, Inc. (b) 435,000 13,902,600
Sun Microsystems, Inc. (b) 600,000 2,760,000
--------------
16,662,600
Computer - Memory Devices 1.8%
EMC Corporation (b) 895,000 9,370,650
Network Appliance, Inc. (b) 140,000 2,269,400
--------------
11,640,050
Computer - Services 0.5%
International Business Machines Corporation 40,000 3,300,000
Computer Software - Desktop 3.0%
Microsoft Corporation 750,000 19,207,500
Computer Software - Enterprise 3.1%
Oracle Systems Corporation (b) 550,000 6,611,000
SAP AG Sponsored ADR 85,000 2,483,700
Siebel Systems, Inc. (b) 665,000 6,344,100
VERITAS Software Corporation (b) 170,000 4,873,900
--------------
20,312,700
Cosmetics - Personal Care 0.2%
Colgate Palmolive Company 25,000 1,448,750
Diversified Operations 4.0%
AOL Time Warner, Inc. (b) 415,000 6,677,350
General Electric Company 525,000 15,057,000
3M Co. 20,000 2,579,600
United Technologies Corporation 25,000 1,770,750
--------------
26,084,700
Electronics - Semiconductor
Equipment 1.8%
Applied Materials, Inc. (b) 340,000 5,392,400
KLA-Tencor Corporation (b) 95,000 4,416,550
Novellus Systems, Inc. (b) 60,000 2,197,260
--------------
12,006,210
Electronics - Semiconductor
Manufacturing 8.4%
Analog Devices, Inc. (b) 285,000 9,923,700
Applied Micro Circuits Corporation (b) 200,000 1,210,000
Broadcom Corporation Class A (b) 370,000 9,216,700
Intel Corporation 910,000 18,913,440
Micron Technology, Inc. (b) 270,000 3,140,100
PMC-Sierra, Inc. (b) 140,000 1,642,200
Taiwan Semiconductor Manufacturing
Company, Ltd. Sponsored ADR (b) 550,000 5,544,000
Texas Instruments, Inc. 290,000 5,104,000
--------------
54,694,140
Finance - Consumer/Commercial Loans 1.4%
Capital One Financial Corporation 110,000 5,409,800
SLM Corporation 90,000 3,525,300
--------------
8,935,100
Finance - Investment Brokers 1.4%
The Goldman Sachs Group, Inc. 50,000 4,187,500
Lehman Brothers Holdings, Inc. 45,000 2,991,600
Merrill Lynch & Company, Inc. 35,000 1,633,800
--------------
8,812,900
Financial Services - Miscellaneous 2.4%
American Express Company 190,000 7,943,900
First Data Corporation 115,000 4,765,600
Fiserv, Inc. (b) 75,000 2,670,750
--------------
15,380,250
Food - Miscellaneous Preparation 0.5%
PepsiCo, Inc. 75,000 3,337,500
Insurance - Diversified 0.5%
John Hancock Financial Services, Inc. 55,000 1,690,150
Principal Financial Group, Inc. 50,000 1,612,500
--------------
3,302,650
Internet - E*Commerce 2.8%
Amazon.com, Inc. (b) 120,000 4,378,800
eBay, Inc. (b) 55,000 5,729,900
InterActiveCorp (b) 205,000 8,111,850
--------------
18,220,550
Internet - Internet Service
Provider/Content 0.8%
Yahoo! Inc. (b) 150,000 4,914,000
Leisure - Gaming 0.6%
International Game Technology 25,000 2,558,250
Wynn Resorts, Ltd. (b) 85,000 1,503,650
--------------
4,061,900
Leisure - Hotels & Motels 0.4%
Starwood Hotels & Resorts Worldwide, Inc. 90,000 2,573,100
Leisure - Products 0.3%
Harley-Davidson, Inc. 45,000 1,793,700
Machinery - General Industrial 0.4%
Ingersoll-Rand Company Class A 50,000 2,366,000
Media - Cable TV 1.3%
EchoStar Communications Corporation
Class A (b) 195,000 6,750,900
General Motors Corporation Class H (b) 140,000 1,793,400
--------------
8,544,300
Media - Radio/TV 2.2%
Clear Channel Communications, Inc. (b) 95,000 4,027,050
Univision Communications, Inc. Class A (b) 80,000 2,432,000
Viacom, Inc. Class B (b) 175,000 7,640,500
--------------
14,099,550
Medical - Biomedical/Genetics 4.6%
Amgen, Inc. (b) 150,000 9,966,000
Genentech, Inc. (b) 30,000 2,163,600
Genzyme Corporation (b) 185,000 7,733,000
Gilead Sciences, Inc. (b) 155,000 8,614,900
Medimmune, Inc. (b) 45,000 1,636,650
--------------
30,114,150
25
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 2003 (Unaudited)
- -------------------------------------------------------------------------------
STRONG LARGE CAP GROWTH FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Medical - Drug/Diversified 1.8%
Abbott Laboratories 115,000 $ 5,032,400
Johnson & Johnson 130,000 6,721,000
--------------
11,753,400
Medical - Ethical Drugs 8.3%
Allergan, Inc. 20,000 1,542,000
Forest Laboratories, Inc. (b) 135,000 7,391,250
Eli Lilly & Company 20,000 1,379,400
Merck & Company, Inc. 100,000 6,055,000
Pfizer, Inc. 970,000 33,125,500
Wyeth 100,000 4,555,000
--------------
54,048,150
Medical - Generic Drugs 0.8%
Teva Pharmaceutical Industries, Ltd. ADR 90,000 5,123,700
Medical - Health Maintenance
Organizations 0.8%
Aetna, Inc. 90,000 5,418,000
Medical - Products 3.0%
Alcon, Inc. 35,000 1,599,500
Boston Scientific Corporation (b) 210,000 12,831,000
Medtronic, Inc. 105,000 5,036,850
--------------
19,467,350
Medical - Wholesale Drugs/Sundries 0.9%
AmerisourceBergen Corporation 40,000 2,774,000
Cardinal Health, Inc. 50,000 3,215,000
--------------
5,989,000
Medical/Dental - Services 0.4%
Quest Diagnostics, Inc. (b) 40,000 2,552,000
Metal Ores - Gold/Silver 0.5%
Newmont Mining Corporation Holding
Company 90,000 2,921,400
Metal Ores - Miscellaneous 0.5%
Alcan, Inc. 30,000 938,700
Alcoa, Inc. 80,000 2,040,000
--------------
2,978,700
Metal Products - Fasteners 0.2%
Illinois Tool Works, Inc. 20,000 1,317,000
Oil & Gas - Drilling 0.7%
ENSCO International, Inc. 80,000 2,152,000
Nabors Industries, Ltd. (b) 65,000 2,570,750
--------------
4,722,750
Oil & Gas - Machinery/Equipment 0.7%
Smith International, Inc. (b) 65,000 2,388,100
Weatherford International, Ltd. (b) 55,000 2,304,500
--------------
4,692,600
Oil & Gas - United States Exploration &
Production 0.8%
Apache Corporation 25,000 1,626,500
Burlington Resources, Inc. 35,000 1,892,450
Occidental Petroleum Corporation 50,000 1,677,500
--------------
5,196,450
Retail - Consumer Electronics 0.2%
Best Buy Company, Inc. (b) 30,000 1,317,600
Retail - Department Stores 1.0%
Kohl's Corporation (b) 115,000 5,908,700
Retail - Discount & Variety 0.7%
Dollar Tree Stores, Inc. (b) 145,000 4,600,850
Retail - Drug Stores 0.2%
Walgreen Company 53,000 1,595,300
Retail - Home Furnishings 0.4%
Bed Bath & Beyond, Inc. (b) 60,000 2,328,600
Retail - Major Discount Chains 1.9%
Family Dollar Stores, Inc. 100,000 3,815,000
Target Corporation 165,000 6,243,600
Wal-Mart Stores, Inc. 40,000 2,146,800
--------------
12,205,400
Retail - Restaurants 0.2%
Starbucks Corporation (b) 65,000 1,593,800
Retail/Wholesale - Building Products 3.0%
The Home Depot, Inc. 485,000 16,063,200
Lowe's Companies, Inc. 75,000 3,221,250
--------------
19,284,450
Soap & Cleaning Preparations 1.8%
The Procter & Gamble Company 130,000 11,593,400
Steel - Producers 1.0%
Nucor Corporation 140,000 6,839,000
Telecommunications - Cellular 3.0%
AT&T Wireless Services, Inc. (b) 385,000 3,160,850
Nextel Communications, Inc. Class A (b) 415,000 7,503,200
Sprint Corporation - PCS Group (b) 175,000 1,006,250
Vodafone Group PLC Sponsored ADR 375,000 7,368,750
--------------
19,039,050
Telecommunications - Equipment 8.2%
Alcatel SA ADR (b) 220,000 1,969,000
Corning, Inc. (b) 2,510,000 18,548,900
JDS Uniphase Corporation (b) 3,010,000 10,565,100
Lucent Technologies, Inc. (b) 2,000,000 4,060,000
Nokia Corporation Sponsored ADR 465,000 7,639,950
Nortel Networks Corporation (b) 3,330,000 8,991,000
UTStarcom, Inc. (b) 45,000 1,600,650
--------------
53,374,600
Transportation - Air Freight 0.3%
FedEx Corporation 35,000 2,171,050
Trucks & Parts - Heavy Duty 0.2%
PACCAR, Inc. 20,000 1,351,200
Utility - Electric Power 1.3%
American Electric Power Company, Inc. 145,000 4,325,350
Calpine Corporation (b) 300,000 1,980,000
PPL Corporation 25,000 1,075,000
The Southern Company 35,000 1,090,600
--------------
8,470,950
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $551,142,117) 647,142,850
- -------------------------------------------------------------------------------
Short-Term Investments (a) 6.4%
Collateral Received for Securities
Lending (f) 4.4%
Money Market Funds 3.0%
Deutsche Daily Assets Fund - Institutional
Class 19,292,015 19,292,015
26
- -------------------------------------------------------------------------------
STRONG LARGE CAP GROWTH FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Repurchase Agreements 1.4%
Barclays Capital, Inc. (Dated 6/30/03),
1.23%, Due 7/01/03 (Repurchase proceeds
$3,069,661); Collateralized by: United
States Government & Agency Issues $ 3,069,545 $ 3,069,545
Goldman, Sachs and Company (Dated
6/30/03), 1.22%, Due 7/01/03 (Repurchase
proceeds $3,069,649); Collateralized by:
United States Government & Agency Issues 3,069,545 3,069,545
Lehman Brothers Inc. (Dated 6/30/03),
1.23%, Due 7/01/03 (Repurchase proceeds
$3,069,661); Collateralized by: United
States Government & Agency Issues 3,069,545 3,069,545
--------------
9,208,635
--------------
Total Collateral Received for Securities
Lending 28,500,650
Repurchase Agreements 1.9%
ABN AMRO Inc. (Dated 6/30/03), 1.20%,
Due 7/01/03 (Repurchase proceeds
$8,200,273); Collateralized by: United
States Government & Agency Issues (c) 8,200,000 8,200,000
State Street Bank (Dated 6/30/03), 0.75%,
Due 7/01/03 (Repurchase proceeds
$3,990,583); Collateralized by: United
States Government & Agency Issues (c) 3,990,500 3,990,500
--------------
Total Repurchase Agreements 12,190,500
United States Government Issues 0.1%
United States Treasury Bills,
Due 7/17/03 thru 8/14/03 (e) 1,050,000 1,049,379
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $41,740,271) 41,740,529
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $592,882,388) 106.1% 688,883,379
Other Assets & Liabilities, Net (6.1%) (39,719,303)
- -------------------------------------------------------------------------------
Net Assets 100.0% $ 649,164,076
===============================================================================
FUTURES
- -------------------------------------------------------------------------------
Underlying Unrealized
Expiration Face Amount Appreciation/
Date at Value (Depreciation)
- -------------------------------------------------------------------------------
Purchased:
55 Nasdaq 100 Futures 9/03 $ 6,624,750 $ (185,280)
WRITTEN OPTIONS ACTIVITY
- -------------------------------------------------------------------------------
Contracts Premiums
- -------------------------------------------------------------------------------
Options outstanding at beginning of period -- $ --
Options written during the period 900 798,276
Options closed -- --
Options expired (900) (798,276)
Options exercised -- --
------------ --------------
Options outstanding at end of period -- $ --
============ ==============
STRONG LARGE COMPANY GROWTH FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 92.6%
Banks - Money Center 4.2%
The Bank of New York Company, Inc. 23,500 $ 675,625
Citigroup, Inc. 17,400 744,720
--------------
1,420,345
Beverages - Alcoholic 1.9%
Anheuser-Busch Companies, Inc. 12,500 638,125
Computer - Local Networks 2.6%
Cisco Systems, Inc. (b) 51,700 862,873
Computer - Manufacturers 1.5%
Dell, Inc. (b) 15,500 495,380
Computer - Services 3.4%
Amdocs, Ltd. (b) 26,500 636,000
International Business Machines Corporation 6,000 495,000
--------------
1,131,000
Computer Software - Desktop 3.4%
Microsoft Corporation 44,500 1,139,645
Computer Software - Enterprise 1.9%
Oracle Systems Corporation (b) 52,900 635,858
Cosmetics - Personal Care 1.9%
Colgate Palmolive Company 11,200 649,040
Diversified Operations 4.9%
General Electric Company 57,000 1,634,760
Electronics - Measuring Instruments 1.6%
Cognex Corporation (b) 24,400 545,340
Electronics - Military Systems 1.5%
L-3 Communications Corporation (b) 11,300 491,437
Electronics - Parts Distributors 1.6%
W.W. Grainger, Inc. 11,600 542,416
Electronics - Semiconductor Equipment 1.6%
Novellus Systems, Inc. (b) 15,000 549,315
Electronics - Semiconductor
Manufacturing 5.2%
Analog Devices, Inc. (b) 14,100 490,962
Intel Corporation 28,700 596,501
Linear Technology Corporation 20,800 669,968
--------------
1,757,431
Finance - Mortgage & Related Services 1.7%
Fannie Mae 8,600 579,984
Finance - Publicly Traded Investment
Funds - Equity 2.3%
iShares Goldman Sachs Networking Fund (b) 23,000 445,740
iShares Russell 1000 Growth Index Fund 8,100 332,505
--------------
778,245
Finance - Publicly Traded Investment
Funds-Equity (Non 40 Act) 3.0%
Pharmaceutical Holders Trust 12,300 995,070
Financial Services - Miscellaneous 1.7%
American Express Company 13,300 556,073
27
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 2003 (Unaudited)
- -------------------------------------------------------------------------------
STRONG LARGE COMPANY GROWTH FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Food - Confectionery 1.1%
Hershey Foods Corporation 5,400 $ 376,164
Food - Miscellaneous Preparation 3.0%
PepsiCo, Inc. 22,500 1,001,250
Insurance - Diversified 2.1%
American International Group, Inc. 12,800 706,304
Internet - E*Commerce 4.0%
eBay, Inc. (b) 5,500 572,990
InterActiveCorp (b) 19,000 751,830
--------------
1,324,820
Media - Cable TV 0.9%
Comcast Corporation Class A (b) 9,500 286,710
Media - Radio/TV 2.0%
Viacom, Inc. Class B (b) 15,500 676,730
Medical - Biomedical/Genetics 3.0%
Amgen, Inc. (b) 14,900 989,956
Medical - Drug/Diversified 1.9%
Johnson & Johnson 12,500 646,250
Medical - Ethical Drugs 8.4%
Pfizer, Inc. 46,180 1,577,047
Schering-Plough Corporation 22,500 418,500
Wyeth 18,300 833,565
--------------
2,829,112
Medical - Generic Drugs 4.6%
Barr Laboratories, Inc. (b) 10,500 687,750
Teva Pharmaceutical Industries, Ltd. ADR 14,700 836,871
--------------
1,524,621
Medical - Products 2.6%
Medtronic, Inc. 10,100 484,497
St. Jude Medical, Inc. (b) 7,000 402,500
--------------
886,997
Metal Ores - Gold/Silver 0.9%
Newmont Mining Corporation Holding
Company 9,400 305,124
Oil & Gas - United States Exploration &
Production 1.2%
Devon Energy Corporation 7,417 396,068
Retail - Major Discount Chains 2.9%
Wal-Mart Stores, Inc. 17,800 955,326
Retail/Wholesale - Building Products 1.6%
Lowe's Companies, Inc. 12,500 536,875
Retail/Wholesale - Jewelry 2.9%
Tiffany & Company 29,600 967,328
Shoes & Related Apparel 2.0%
NIKE, Inc. Class B 12,800 684,672
Soap & Cleaning Preparations 1.6%
The Procter & Gamble Company 6,100 543,998
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $28,677,660) 31,040,642
- -------------------------------------------------------------------------------
Convertible Notes 3.0%
Media - Radio/TV 2.0%
Sirius Satellite Radio, Inc.
Notes, 3.50%, Due 6/01/08 464,000 668,160
Medical - Instruments 1.0%
Nektar Therapeutics
Notes, 3.00%, Due 6/30/10 (d) 320,000 320,800
- -------------------------------------------------------------------------------
Total Convertible Notes (Cost $813,025) 988,960
- -------------------------------------------------------------------------------
Convertible Preferred Stocks 3.5%
Finance - Savings & Loan 1.9%
Washington Mutual, Inc. 5.375% 10,900 645,825
Medical - Health Maintenance
Organizations 1.6%
Anthem, Inc. 6.00% 5,600 523,600
- -------------------------------------------------------------------------------
Total Convertible Preferred Stocks (Cost $944,506) 1,169,425
- -------------------------------------------------------------------------------
Short-Term Investments (a) 5.9%
Repurchase Agreements
State Street Bank (Dated 6/30/03), 0.75%,
Due 7/01/03 (Repurchase proceeds
$1,992,442); Collateralized by: United
States Government & Agency Issues (c) $ 1,992,400 1,992,400
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $1,992,400) 1,992,400
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $32,427,591) 105.0% 35,191,427
Other Assets and Liabilities, Net (5.0%) (1,673,085)
- -------------------------------------------------------------------------------
Net Assets 100.0% $ 33,518,342
===============================================================================
- -------------------------------------------------------------------------------
STRONG U.S. EMERGING GROWTH FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 98.2%
Commercial Services - Advertising 1.0%
aQuantive, Inc. (b) 72,005 $ 756,052
Commercial Services - Miscellaneous 3.1%
Corporate Executive Board Company (b) 38,635 1,565,877
WFS Financial, Inc. (b) 21,825 731,356
--------------
2,297,233
Commercial Services - Schools 4.4%
Career Education Corporation (b) 17,915 1,225,744
Corinthian Colleges, Inc. (b) 42,125 2,046,011
--------------
3,271,755
Computer - Graphics 1.3%
Magma Design Automation (b) 57,880 992,642
Computer - Local Networks 5.4%
Extreme Networks, Inc. (b) 120,020 636,106
Foundry Networks, Inc. (b) 100,415 1,445,976
QLogic Corporation (b) 39,710 1,919,184
--------------
4,001,266
Computer - Services 1.3%
MTC Technologies, Inc. (b) 41,190 966,317
28
- -------------------------------------------------------------------------------
STRONG U.S. EMERGING GROWTH FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Computer Software - Enterprise 3.1%
SERENA Software, Inc. (b) 55,850 $ 1,166,148
Trident Microsystems, Inc. (b) 122,810 1,117,571
--------------
2,283,719
Computer Software - Medical 1.6%
eResearch Technology, Inc. (b) 51,620 1,153,191
Computer Software - Security 2.2%
Netscreen Technologies, Inc. (b) 70,805 1,596,653
Electronics - Semiconductor Equipment 2.7%
Cabot Microelectronics Corporation (b) 39,000 1,968,330
Electronics - Semiconductor
Manufacturing 11.1%
Integrated Circuit Systems, Inc. (b) 63,815 2,005,705
OmniVision Technologies, Inc. (b) 78,125 2,437,500
Power Integrations, Inc. (b) 36,235 881,235
Silicon Laboratories, Inc. (b) 40,045 1,066,799
Zoran Corporation (b) 95,890 1,842,047
--------------
8,233,286
Finance - Consumer/Commercial Loans 0.9%
Portfolio Recovery Associates, Inc. (b) 20,855 642,543
Financial Services - Miscellaneous 2.5%
Investors Financial Services Corporation 62,970 1,826,760
Insurance - Property/Casualty/Title 0.9%
ProAssurance Corporation (b) 24,890 671,781
Internet - E*Commerce 5.6%
Getty Images, Inc. (b) 19,435 802,665
Netflix, Inc. (b) 66,130 1,689,622
University of Phoenix Online (b) 32,930 1,669,551
--------------
4,161,838
Internet - Internet Service
Provider/Content 2.0%
j2 Global Communications, Inc. (b) 31,780 1,461,880
Internet - Software 1.0%
United Online, Inc. (b) 29,330 743,222
Leisure - Gaming 1.0%
Shuffle Master, Inc. (b) 26,365 769,594
Leisure - Photo Equipment/Related 1.5%
Lexar Media, Inc. (b) 117,995 1,116,233
Leisure - Toys/Games/Hobby 4.1%
Leapfrog Enterprises, Inc. Class A (b) 68,125 2,167,056
Marvel Enterprises, Inc. (b) 47,425 905,818
--------------
3,072,874
Medical - Biomedical/Genetics 1.0%
CV Therapeutics, Inc. (b) 24,900 738,534
Medical - Generic Drugs 3.6%
American Pharmaceutical Partners, Inc. (b) 40,485 1,372,441
Andrx Group (b) 63,530 1,264,247
--------------
2,636,688
Medical - Instruments 0.8%
Biolase Technology, Inc. (b) 54,500 584,785
Medical - Nursing Homes 6.1%
Odyssey Healthcare, Inc. (b) 77,195 2,856,215
VistaCare, Inc. Class A (b) 69,335 1,685,534
--------------
4,541,749
Medical - Products 5.8%
Advanced Neuromodulation Systems, Inc. (b) 14,550 753,253
Cyberonics, Inc. (b) 29,470 633,900
STAAR Surgical Company (b) 81,755 948,358
SurModics, Inc. (b) 12,750 388,875
Wilson Greatbatch Technologies, Inc. (b) 39,775 1,435,878
Zoll Medical Corporation (b) 4,700 157,732
--------------
4,317,996
Medical/Dental - Services 1.0%
Enzo Biochem, Inc. (b) 33,988 731,422
Oil & Gas - Drilling 1.0%
Unit Corporation (b) 36,520 763,633
Oil & Gas - United States Exploration &
Production 3.3%
Evergreen Resources, Inc. (b) 26,660 1,447,905
Spinnaker Exploration Company (b) 39,445 1,033,459
--------------
2,481,364
Retail - Apparel/Shoe 3.5%
Chicos FAS, Inc. (b) 52,230 1,099,441
Hot Topic, Inc. (b) 54,625 1,469,959
--------------
2,569,400
Retail - Discount & Variety 1.5%
Fred's, Inc. 30,030 1,116,515
Retail - Mail Order & Direct 0.9%
J. Jill Group, Inc. (b) 41,010 690,608
Retail - Restaurants 5.6%
The Cheesecake Factory, Inc. (b) 32,055 1,150,454
P.F. Chang's China Bistro, Inc. (b) 43,850 2,157,859
Panera Bread Company Class A (b) 21,435 857,400
--------------
4,165,713
Transportation - Services 1.9%
C.H. Robinson Worldwide, Inc. 39,325 1,398,397
Transportation - Truck 5.5%
Heartland Express, Inc. (b) 30,475 678,069
J.B. Hunt Transport Services, Inc. (b) 41,810 1,578,328
Knight Transportation, Inc. (b) 71,970 1,792,053
--------------
4,048,450
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $53,197,600) 72,772,423
- -------------------------------------------------------------------------------
Short-Term Investments (a) 2.1%
Repurchase Agreements
ABN AMRO Inc. (Dated 6/30/03), 1.20%,
Due 7/01/03 (Repurchase proceeds
$100,003); Collateralized by: United States
Government & Agency Issues (c) $ 100,000 100,000
State Street Bank (Dated 6/30/03), 0.75%,
Due 7/01/03 (Repurchase proceeds
$1,443,330); Collateralized by: United
States Government & Agency Issues (c) 1,443,300 1,443,300
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $1,543,300) 1,543,300
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $54,740,900) 100.3% 74,315,723
Other Assets & Liabilities, Net (0.3%) (233,258)
- -------------------------------------------------------------------------------
Net Assets 100.0% $ 74,082,465
===============================================================================
29
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 2003 (Unaudited)
- -------------------------------------------------------------------------------
STRONG ENTERPRISE FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 99.1%
Auto/Truck - Original Equipment 1.2%
Eaton Corporation 40,100 $ 3,152,261
Banks - Super Regional 1.0%
SouthTrust Corporation 91,100 2,477,920
Chemicals - Fertilizers 0.7%
Agrium, Inc. 171,900 1,884,024
Commercial - Leasing Companies 0.6%
Ryder Systems, Inc. 58,700 1,503,894
Commercial Services - Advertising 1.2%
Lamar Advertising Company (b) 89,390 3,147,422
Commercial Services - Miscellaneous 0.3%
Corporate Executive Board Company (b) 22,600 915,978
Commercial Services - Schools 2.0%
Apollo Group, Inc. Class A (b) 22,730 1,403,805
Career Education Corporation (b) 53,800 3,680,996
--------------
5,084,801
Commercial Services - Staffing 1.5%
Monster Worldwide, Inc. (b) 193,990 3,827,423
Computer - Integrated Systems 0.5%
Symbol Technologies, Inc. 93,100 1,211,231
Computer - Local Networks 1.0%
Juniper Networks, Inc. (b) 198,200 2,451,734
Computer Software - Desktop 0.8%
Adobe Systems, Inc. 64,790 2,077,815
Computer Software -
Education/Entertainment 1.4%
Electronic Arts, Inc. (b) 47,056 3,481,673
Computer Software - Enterprise 3.6%
Mercury Interactive Corporation (b) 86,890 3,354,823
Siebel Systems, Inc. (b) 182,300 1,739,142
VERITAS Software Corporation (b) 147,810 4,237,713
--------------
9,331,678
Computer Software - Financial 0.5%
Sungard Data Systems, Inc. (b) 51,510 1,334,624
Computer Software - Security 1.1%
Symantec Corporation (b) 65,650 2,879,409
Electronics - Semiconductor
Equipment 2.3%
KLA-Tencor Corporation (b) 103,680 4,820,083
Novellus Systems, Inc. (b) 31,810 1,164,914
--------------
5,984,997
Electronics - Semiconductor
Manufacturing 6.6%
Altera Corporation (b) 140,600 2,305,840
Applied Micro Circuits Corporation (b) 298,400 1,805,320
Intersil Holding Corporation Class A (b) 115,300 3,068,133
Maxim Integrated Products, Inc. 82,045 2,805,118
Microchip Technology, Inc. 79,875 1,967,321
Micron Technology, Inc. (b) 120,000 1,395,600
Semtech Corporation (b) 134,820 1,919,837
Xilinx, Inc. (b) 71,160 1,801,060
--------------
17,068,229
Finance - Consumer/Commercial Loans 0.7%
Providian Financial Corporation (b) 188,600 1,746,436
Finance - Equity REIT 0.3%
Windrose Medical Properties Trust 62,300 669,725
Finance - Investment Brokers 1.8%
Legg Mason, Inc. 23,795 1,545,485
Lehman Brothers Holdings, Inc. 48,195 3,204,004
--------------
4,749,489
Finance - Investment Management 0.7%
SEI Investments Company 57,915 1,853,280
Finance - Publicly Traded Investment
Funds-Equity (Non 40 Act) 1.1%
Internet HOLDRs Trust 75,100 2,911,627
Financial Services - Miscellaneous 0.8%
Investors Financial Services Corporation 74,400 2,158,344
Household - Audio/Video 1.9%
Harman International Industries, Inc. 60,230 4,766,602
Household - Office Furniture 0.2%
Furniture Brands International, Inc. (b) 24,400 636,840
Internet - E*Commerce 2.0%
InterActiveCorp (b) 70,090 2,773,461
Priceline.com, Inc. (b) 109,771 2,450,089
--------------
5,223,550
Internet - Internet Service
Provider/Content 1.6%
Yahoo! Inc. (b) 123,728 4,053,329
Internet - Software 0.7%
BEA Systems, Inc. (b) 164,690 1,788,533
Leisure - Gaming 0.7%
Harrah's Entertainment, Inc. (b) 46,020 1,851,845
Leisure - Hotels & Motels 1.7%
Hilton Hotels Corporation 137,895 1,763,677
Starwood Hotels & Resorts Worldwide, Inc. 89,200 2,550,228
--------------
4,313,905
Leisure - Services 2.7%
Royal Caribbean Cruises, Ltd. 299,300 6,931,788
Leisure - Toys/Games/Hobby 1.1%
Leapfrog Enterprises, Inc. Class A (b) 88,600 2,818,366
Machinery - Construction/Mining 0.6%
Terex Corporation (b) 78,100 1,524,512
Media - Cable TV 0.9%
EchoStar Communications Corporation
Class A (b) 68,710 2,378,740
Media - Newspapers 2.3%
The E.W. Scripps Company Class A 66,385 5,889,677
30
- -------------------------------------------------------------------------------
STRONG ENTERPRISE FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Media - Radio/TV 5.5%
Cox Radio, Inc. Class A (b) 54,900 $ 1,268,739
Emmis Broadcasting Corporation Class A (b) 252,995 5,806,235
LIN TV Corporation (b) 108,490 2,554,939
Univision Communications, Inc. Class A (b) 106,870 3,248,848
Westwood One, Inc. (b) 38,390 1,302,573
--------------
14,181,334
Medical - Biomedical/Genetics 6.2%
Amylin Pharmaceuticals, Inc. (b) 38,400 840,576
Digene Corporation (b) 50,300 1,369,669
Genzyme Corporation (b) 91,075 3,806,935
Gilead Sciences, Inc. (b) 42,526 2,363,595
IDEC Pharmaceuticals Corporation (b) 113,600 3,862,400
Millennium Pharmaceuticals, Inc. (b) 243,200 3,825,536
--------------
16,068,711
Medical - Ethical Drugs 1.6%
Medicis Pharmaceutical Corporation Class A 72,500 4,110,750
Medical - Generic Drugs 1.1%
Teva Pharmaceutical Industries, Ltd. ADR 50,050 2,849,347
Medical - Health Maintenance
Organizations 1.6%
Anthem, Inc. (b) 53,465 4,124,825
Medical - Hospitals 1.3%
Community Health Systems, Inc. (b) 169,270 3,288,916
Medical - Products 3.1%
C.R. Bard, Inc. 37,600 2,681,256
Edwards Lifesciences Corporation (b) 41,300 1,327,382
INAMED Corporation (b) 31,000 1,664,390
Viasys Healthcare, Inc. (b) 7,300 151,110
Zimmer Holdings, Inc. (b) 47,765 2,151,813
--------------
7,975,951
Medical - Wholesale Drugs/Sundries 0.6%
AmerisourceBergen Corporation 20,530 1,423,756
Medical/Dental - Services 0.6%
Caremark Rx, Inc. (b) 59,510 1,528,217
Metal Ores - Gold/Silver 1.0%
Newmont Mining Corporation Holding
Company 82,230 2,669,186
Oil & Gas - Drilling 2.6%
Nabors Industries, Ltd. (b) 74,105 2,930,853
Patterson Utility Energy, Inc. (b) 36,800 1,192,320
Pride International, Inc. (b) 63,590 1,196,764
Transocean, Inc. (b) 63,600 1,397,292
--------------
6,717,229
Oil & Gas - Field Services 0.6%
BJ Services Company (b) 39,330 1,469,369
Oil & Gas - Machinery/Equipment 1.6%
Grant Prideco, Inc. (b) 108,415 1,273,876
Weatherford International, Ltd. (b) 67,455 2,826,365
--------------
4,100,241
Oil & Gas - United States Exploration &
Production 1.3%
Pioneer Natural Resources Company (b) 48,200 1,258,020
XTO Energy, Inc. 107,640 2,164,640
--------------
3,422,660
Paper & Paper Products 0.9%
Domtar, Inc. (d) 204,590 2,260,720
Retail - Apparel/Shoe 5.0%
Abercrombie & Fitch Company Class A (b) 98,900 2,809,749
Coach, Inc. (b) 40,200 1,999,548
The Finish Line, Inc. Class A (b) 108,260 2,404,455
Too, Inc. (b) 115,210 2,333,002
Urban Outfitters, Inc. (b) 91,500 3,284,850
--------------
12,831,604
Retail - Home Furnishings 2.9%
Bed Bath & Beyond, Inc. (b) 103,580 4,019,940
The Bombay Company, Inc. (b) 134,655 1,431,382
Williams-Sonoma, Inc. (b) 68,100 1,988,520
--------------
7,439,842
Retail - Miscellaneous/Diversified 1.0%
PETsMART, Inc. (b) 148,882 2,481,863
Retail - Restaurants 2.8%
O'Charley's, Inc. (b) 75,900 1,634,127
P.F. Chang's China Bistro, Inc. (b) 27,435 1,350,076
Panera Bread Company Class A (b) 104,519 4,180,760
--------------
7,164,963
Telecommunications - Cellular 0.7%
Nextel Communications, Inc. Class A (b) 93,240 1,685,779
Telecommunications - Equipment 4.2%
Adtran, Inc. (b) 37,400 1,918,246
Advanced Fibre Communications, Inc. (b) 122,645 1,995,434
Alcatel SA ADR (b) 334,600 2,994,670
Avaya, Inc. (b) 222,900 1,439,934
Corning, Inc. (b) 343,100 2,535,509
--------------
10,883,793
Transportation - Airline 2.6%
AirTran Holdings, Inc. (b) 355,600 3,723,132
Delta Air Lines, Inc. 199,770 2,932,624
--------------
6,655,756
Transportation - Truck 0.7%
Heartland Express, Inc. (b) 83,198 1,851,156
Trucks & Parts - Heavy Duty 1.5%
Navistar International Corporation (b) 122,310 3,990,975
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $223,585,096) 255,258,644
- -------------------------------------------------------------------------------
Short-Term Investments (a) 13.3%
Collateral Received for Securities
Lending (f) 12.0%
Money Market Funds 8.1%
Deutsche Daily Assets Fund - Institutional
Class 20,892,641 20,892,641
Repurchase Agreements 3.9%
Barclays Capital, Inc. (Dated 6/30/03),
1.23%, Due 7/01/03 (Repurchase
proceeds $3,324,345); Collateralized by:
United States Government &
Agency Issues $ 3,324,220 3,324,220
Goldman, Sachs and Company (Dated
6/30/03), 1.22%, Due 7/01/03 (Repurchase
proceeds $3,324,333); Collateralized by:
United States Government & Agency Issues 3,324,220 3,324,220
31
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 2003 (Unaudited)
- -------------------------------------------------------------------------------
STRONG ENTERPRISE FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Lehman Brothers Inc. (Dated 6/30/03),
1.23%, Due 7/01/03 (Repurchase
proceeds $3,324,345); Collateralized by:
United States Government &
Agency Issues $ 3,324,220 $ 3,324,220
--------------
9,972,660
--------------
Total Collateral Received for Securities
Lending 30,865,301
Repurchase Agreements 1.3%
ABN AMRO Inc. (Dated 6/30/03), 1.20%,
Due 7/01/03, (Repurchase proceeds
$1,200,040); Collateralized by: United
States Government & Agency Issues (c) 1,200,000 1,200,000
State Street Bank (Dated 6/30/03), 0.75%,
Due 7/01/03, (Repurchase proceeds
$2,057,243); Collateralized by: United
States Government & Agency Issues (c) 2,057,200 2,057,200
--------------
Total Repurchase Agreements 3,257,200
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $34,122,501) 34,122,501
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $257,707,597) 112.4% 289,381,145
Other Assets and Liabilities, Net (12.4%) (31,987,758)
- -------------------------------------------------------------------------------
Net Assets 100.0% $ 257,393,387
===============================================================================
STRONG GROWTH 20 FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 97.2%
Banks - Money Center 2.0%
Citigroup, Inc. 130,000 $ 5,564,000
Building - Resident/Commercial 2.6%
Lennar Corporation Class A 100,000 7,150,000
Commercial Services - Schools 3.4%
Apollo Group, Inc. Class A (b) 150,000 9,264,000
Computer - Local Networks 5.2%
Cisco Systems, Inc. (b) 500,000 8,345,000
Juniper Networks, Inc. (b) 490,000 6,061,300
--------------
14,406,300
Computer - Manufacturers 5.8%
Dell, Inc. (b) 500,000 15,980,000
Computer - Services 4.1%
Amdocs, Ltd. (b) 475,000 11,400,000
Computer Software - Enterprise 4.1%
VERITAS Software Corporation (b) 400,000 11,468,000
Computer Software - Security 4.0%
VeriSign, Inc. (b) 800,000 11,064,000
Electronics - Semiconductor Equipment 1.8%
MEMC Electronic Materials, Inc. (b) 500,000 4,900,000
Electronics - Semiconductor
Manufacturing 2.9%
Broadcom Corporation Class A (b) 325,000 8,095,750
Household - Audio/Video 6.7%
Harman International Industries, Inc. 235,000 18,597,900
Internet - E*Commerce 5.6%
eBay, Inc. (b) 150,000 15,627,000
Internet - Internet Service
Provider/Content 1.1%
j2 Global Communications, Inc. (b) 65,000 2,990,000
Medical - Biomedical/Genetics 13.8%
Amgen, Inc. (b) 100,000 6,644,000
Genzyme Corporation (b) 310,000 12,958,000
Gilead Sciences, Inc. (b) 335,000 18,619,300
--------------
38,221,300
Medical - Generic Drugs 3.0%
Taro Pharmaceutical Industries, Ltd. (b) 100,000 5,488,000
Teva Pharmaceutical Industries, Ltd. ADR 50,000 2,846,500
--------------
8,334,500
Medical - Health Maintenance
Organizations 3.8%
Aetna, Inc. 170,000 10,234,000
Mid Atlantic Medical Services, Inc. (b) 5,200 271,960
--------------
10,505,960
Medical - Products 2.5%
Boston Scientific Corporation (b) 115,000 7,026,500
Oil & Gas - Field Services 3.4%
BJ Services Company (b) 250,000 9,340,000
Oil & Gas - Machinery/Equipment 2.7%
Smith International, Inc. (b) 200,000 7,348,000
Retail - Apparel/Shoe 7.0%
Chicos FAS, Inc. (b) 275,000 5,788,750
Coach, Inc. (b) 275,000 13,678,500
--------------
19,467,250
Retail - Restaurants 4.8%
Brinker International, Inc. (b) 160,000 5,763,200
Ruby Tuesday, Inc. 300,000 7,419,000
--------------
13,182,200
Telecommunications - Equipment 6.9%
Corning, Inc. (b) 2,600,000 19,214,000
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $234,123,455) 269,146,660
- -------------------------------------------------------------------------------
Short-Term Investments (a) 5.5%
Repurchase Agreements 5.0%
ABN AMRO Inc. (Dated 6/30/03), 1.20%,
Due 7/01/03 (Repurchase proceeds
$12,300,410); Collateralized by: United
States Government & Agency Issues (c) $ 12,300,000 12,300,000
State Street Bank (Dated 6/30/03), 0.75%,
Due 7/01/03 (Repurchase proceeds
$1,506,631); Collateralized by: United
States Government & Agency Issues (c) 1,506,600 1,506,600
--------------
13,806,600
32
- -------------------------------------------------------------------------------
STRONG GROWTH 20 FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
United States Government Issues 0.5%
United States Treasury Bills,
Due 7/07/03 thru 8/07/03 (e) $ 1,425,000 $ 1,424,545
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $15,230,916) 15,231,145
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $249,354,371) 102.7% 284,377,805
Other Assets and Liabilities, Net (2.7%) (7,576,062)
- -------------------------------------------------------------------------------
Net Assets 100.0% $ 276,801,743
===============================================================================
WRITTEN OPTIONS ACTIVITY
- -------------------------------------------------------------------------------
Contracts Premiums
- -------------------------------------------------------------------------------
Options outstanding at beginning of period -- $ --
Options written during the period 3,385 683,262
Options closed (3,385) (683,262)
Options expired -- --
Options exercised -- --
------------ --------------
Options outstanding at end of period -- $ --
============ ==============
STRONG GROWTH FUND
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Common Stocks 100.0%
Banks - Midwest 0.5%
TCF Financial Corporation 200,000 $ 7,968,000
Banks - Money Center 1.4%
Citigroup, Inc. 575,000 24,610,000
Banks - Super Regional 0.7%
Wells Fargo Company 235,000 11,844,000
Building - Resident/Commercial 1.1%
Centex Corporation 110,000 8,556,900
Lennar Corporation Class A 150,000 10,725,000
--------------
19,281,900
Commercial Services - Advertising 0.1%
Omnicom Group, Inc. 35,000 2,509,500
Commercial Services - Miscellaneous 1.4%
Hewitt Associates, Inc. Class A (b) 100,000 2,355,000
Iron Mountain, Inc. (b) 145,000 5,378,050
Paychex, Inc. 565,000 16,560,150
--------------
24,293,200
Commercial Services - Schools 2.7%
Apollo Group, Inc. Class A (b) 535,000 33,041,600
Corinthian Colleges, Inc. (b) 275,000 13,356,750
--------------
46,398,350
Commercial Services - Staffing 0.5%
Monster Worldwide, Inc. (b) 450,000 8,878,500
Computer - Integrated Systems 0.4%
Symbol Technologies, Inc. 475,000 6,179,750
Computer - Local Networks 3.5%
Cisco Systems, Inc. (b) 2,230,000 37,218,700
Juniper Networks, Inc. (b) 800,000 9,896,000
QLogic Corporation (b) 275,000 13,290,750
--------------
60,405,450
Computer - Manufacturers 2.7%
Dell, Inc. (b) 1,440,000 46,022,400
Computer - Memory Devices 0.8%
EMC Corporation (b) 935,000 9,789,450
Network Appliance, Inc. (b) 250,000 4,052,500
--------------
13,841,950
Computer - Services 2.0%
Affiliated Computer Services, Inc. Class A (b) 75,000 3,429,750
Amdocs, Ltd. (b) 1,255,000 30,120,000
--------------
33,549,750
Computer Software - Desktop 1.5%
Microsoft Corporation 1,000,000 25,610,000
Computer Software -
Education/Entertainment 1.4%
Electronic Arts, Inc. (b) 315,000 23,306,850
Computer Software - Enterprise 3.7%
Documentum, Inc. (b) 730,000 14,359,100
Mercury Interactive Corporation (b) 500,000 19,305,000
Oracle Systems Corporation (b) 625,000 7,512,500
SAP AG Sponsored ADR 460,000 13,441,200
VERITAS Software Corporation (b) 310,000 8,887,700
--------------
63,505,500
Computer Software - Security 2.2%
Netscreen Technologies, Inc. (b) 935,000 21,084,250
Symantec Corporation (b) 100,000 4,386,000
VeriSign, Inc. (b) 920,000 12,723,600
--------------
38,193,850
Cosmetics - Personal Care 0.4%
Colgate Palmolive Company 50,000 2,897,500
The Gillette Company 100,000 3,186,000
--------------
6,083,500
Diversified Operations 0.4%
AOL Time Warner, Inc. (b) 365,000 5,872,850
Electronics - Parts Distributors 0.4%
W.W. Grainger, Inc. 150,000 7,014,000
Electronics - Semiconductor
Equipment 2.2%
KLA-Tencor Corporation (b) 315,000 14,644,350
MEMC Electronic Materials, Inc. (b) 700,000 6,860,000
Novellus Systems, Inc. (b) 460,000 16,845,660
--------------
38,350,010
Electronics - Semiconductor
Manufacturing 7.7%
Altera Corporation (b) 500,000 8,200,000
Analog Devices, Inc. (b) 845,000 29,422,900
Broadcom Corporation Class A (b) 710,000 17,686,100
GlobespanVirata, Inc. (b) 500,000 4,125,000
Integrated Circuit Systems, Inc. (b) 567,300 17,830,239
Intel Corporation 1,075,000 22,342,800
Linear Technology Corporation 275,000 8,857,750
Maxim Integrated Products, Inc. 25,000 854,750
Microchip Technology, Inc. 330,000 8,127,900
STMicroelectronics NV - New York
Registry Shares 100,000 2,079,000
Vitesse Semiconductor Corporation (b) 450,000 2,214,000
Xilinx, Inc. (b) 400,000 10,124,000
--------------
131,864,439
33
SCHEDULES OF INVESTMENTS IN SECURITIES (continued) June 30, 2003 (Unaudited)
- -------------------------------------------------------------------------------
STRONG GROWTH FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Finance - Consumer/Commercial Loans 1.1%
Capital One Financial Corporation 125,000 $ 6,147,500
SLM Corporation 345,000 13,513,650
--------------
19,661,150
Finance - Investment Brokers 0.6%
Lehman Brothers Holdings, Inc. 145,000 9,639,600
Finance - Mortgage & Related Services 0.7%
Doral Financial Corporation 260,000 11,609,000
Financial Services - Miscellaneous 1.6%
Alliance Data Systems Corporation (b) 300,000 7,020,000
American Express Company 220,000 9,198,200
First Data Corporation 285,000 11,810,400
--------------
28,028,600
Food - Miscellaneous Preparation 0.3%
PepsiCo, Inc. 100,000 4,450,000
Household - Audio/Video 0.7%
Harman International Industries, Inc. 160,000 12,662,400
Household - Office Furniture 0.2%
American Financial Realty Trust 280,600 4,183,746
Insurance - Property/Casualty/Title 0.3%
RenaissanceRe Holdings, Ltd. 125,000 5,690,000
Internet - E*Commerce 3.7%
Amazon.com, Inc. (b) 50,000 1,824,500
eBay, Inc. (b) 175,000 18,231,500
InterActiveCorp (b) 675,000 26,709,750
University of Phoenix Online (b) 330,000 16,731,000
--------------
63,496,750
Internet - Internet Service
Provider/Content 0.4%
Yahoo! Inc. (b) 185,000 6,060,600
Leisure - Gaming 0.7%
International Game Technology 110,000 11,256,300
Media - Cable TV 1.5%
EchoStar Communications Corporation
Class A (b) 550,000 19,041,000
General Motors Corporation Class H (b) 575,000 7,365,750
--------------
26,406,750
Media - Radio/TV 3.3%
Sirius Satellite Radio, Inc. (b) 2,400,000 4,056,000
Univision Communications, Inc. Class A (b) 875,000 26,600,000
Viacom, Inc. Class B (b) 385,000 16,809,100
Westwood One, Inc. (b) 120,000 4,071,600
XM Satellite Radio Holdings, Inc. Class A (b) 500,000 5,525,000
--------------
57,061,700
Medical - Biomedical/Genetics 6.1%
Amgen, Inc. (b) 490,000 32,555,600
Biogen, Inc. (b) 130,000 4,940,000
CV Therapeutics, Inc. (b) 320,000 9,491,200
Genentech, Inc. (b) 135,000 9,736,200
Genzyme Corporation (b) 705,000 29,469,000
Gilead Sciences, Inc. (b) 345,000 19,175,100
--------------
105,367,100
Medical - Drug/Diversified 0.7%
Johnson & Johnson 235,000 12,149,500
Medical - Ethical Drugs 6.6%
Allergan, Inc. 25,000 1,927,500
Biovail Corporation International (b) 305,000 14,353,300
Forest Laboratories, Inc. (b) 315,000 17,246,250
Eli Lilly & Company 135,000 9,310,950
Pfizer, Inc. 1,905,000 65,055,750
Wyeth 130,000 5,921,500
--------------
113,815,250
Medical - Generic Drugs 1.4%
Mylan Laboratories, Inc. 145,000 5,041,650
Taro Pharmaceutical Industries, Ltd. (b) 225,000 12,348,000
Teva Pharmaceutical Industries, Ltd. ADR 125,000 7,116,250
--------------
24,505,900
Medical - Health Maintenance
Organizations 0.6%
First Health Group Corporation (b) 400,000 11,040,000
Medical - Instruments 1.6%
CTI Molecular Imaging, Inc. (b) 460,000 8,698,600
Fisher Scientific International, Inc. (b) 550,000 19,195,000
--------------
27,893,600
Medical - Products 5.8%
Advanced Neuromodulation Systems, Inc. (b) 250,000 12,942,500
Alcon, Inc. 385,000 17,594,500
C.R. Bard, Inc. 65,000 4,635,150
Boston Scientific Corporation (b) 540,000 32,994,000
Millipore Corporation (b) 145,000 6,433,650
Respironics, Inc. (b) 350,000 13,132,000
St. Jude Medical, Inc. (b) 220,000 12,650,000
--------------
100,381,800
Medical - Wholesale Drugs/Sundries 0.5%
AmerisourceBergen Corporation 125,000 8,668,750
Medical/Dental - Services 0.4%
Quest Diagnostics, Inc. (b) 35,000 2,233,000
VCA Antech, Inc. (b) 230,000 4,501,100
--------------
6,734,100
Oil & Gas - Drilling 1.6%
ENSCO International, Inc. 605,000 16,274,500
Nabors Industries, Ltd. (b) 100,000 3,955,000
Rowan Companies, Inc. (b) 315,000 7,056,000
--------------
27,285,500
Oil & Gas - Field Services 1.0%
BJ Services Company (b) 475,000 17,746,000
Oil & Gas - Machinery/Equipment 1.0%
Smith International, Inc. (b) 480,000 17,635,200
Oil & Gas - United States Exploration &
Production 1.3%
Apache Corporation 70,000 4,554,200
Burlington Resources, Inc. 50,000 2,703,500
XTO Energy, Inc. 760,001 15,283,620
--------------
22,541,320
Retail - Apparel/Shoe 2.1%
Chicos FAS, Inc. (b) 500,000 10,525,000
Coach, Inc. (b) 325,000 16,165,500
Ross Stores, Inc. 200,000 8,548,000
--------------
35,238,500
Retail - Consumer Electronics 0.5%
Best Buy Company, Inc. (b) 210,000 9,223,200
Retail - Department Stores 1.2%
Kohl's Corporation (b) 400,000 20,552,000
34
- -------------------------------------------------------------------------------
STRONG GROWTH FUND (continued)
Shares or
Principal Value
Amount (Note 2)
- -------------------------------------------------------------------------------
Retail - Discount & Variety 0.4%
99 Cents Only Stores (b) 150,000 $ 5,148,000
Fred's, Inc. 40,000 1,487,200
--------------
6,635,200
Retail - Home Furnishings 0.9%
Bed Bath & Beyond, Inc. (b) 400,000 15,524,000
Retail - Miscellaneous/Diversified 1.7%
Guitar Center, Inc. (b) 575,000 16,675,000
PETCO Animal Supplies, Inc. (b) 285,000 6,195,900
PETsMART, Inc. (b) 355,000 5,917,850
--------------
28,788,750
Retail - Restaurants 1.3%
Outback Steakhouse, Inc. 150,000 5,850,000
P.F. Chang's China Bistro, Inc. (b) 210,000 10,334,100
Panera Bread Company Class A (b) 175,000 7,000,000
--------------
23,184,100
Retail - Super/Mini Markets 0.7%
Whole Foods Marketing, Inc. (b) 250,000 11,882,500
Retail/Wholesale - Auto Parts 1.0%
CarMax, Inc. (b) 565,000 17,034,750
Retail/Wholesale - Building Products 1.2%
The Home Depot, Inc. 390,000 12,916,800
Lowe's Companies, Inc. 175,000 7,516,250
--------------
20,433,050
Steel - Producers 0.5%
Nucor Corporation 175,000 8,548,750
Telecommunications - Cellular 1.1%
Nextel Communications, Inc. Class A (b) 400,000 7,232,000
Vodafone Group PLC Sponsored ADR 635,000 12,477,750
--------------
19,709,750
Telecommunications - Equipment 3.6%
Comverse Technology, Inc. (b) 200,000 3,006,000
Corning, Inc. (b) 3,500,000 25,865,000
JDS Uniphase Corporation (b) 2,000,000 7,020,000
Polycom, Inc. (b) 325,000 4,504,500
UTStarcom, Inc. (b) 600,000 21,342,000
--------------
61,737,500
Transportation - Air Freight 0.5%
FedEx Corporation 125,000 7,753,750
Transportation - Airline 1.9%
JetBlue Airways Corporation (b) 495,000 20,933,550
Ryanair Holdings PLC ADR (b) 250,000 11,225,000
--------------
32,158,550
- -------------------------------------------------------------------------------
Total Common Stocks (Cost $1,369,208,992) 1,719,958,715
- -------------------------------------------------------------------------------
Short-Term Investments (a) 4.5%
Collateral Received for Securities
Lending (f) 4.3%
Money Market Funds 2.9%
Deutsche Daily Assets Fund - Institutional
Class 49,094,332 49,094,332
Repurchase Agreements 1.4%
Barclays Capital, Inc. (Dated 6/30/03),
1.23%, Due 7/01/03 (Repurchase proceeds
$7,811,674); Collateralized by: United States
Government & Agency Issues $ 7,811,380 7,811,380
Goldman, Sachs and Company (Dated 6/30/03),
1.22%, Due 7/01/03 (Repurchase proceeds
$7,811,645); Collateralized by:
United States Government & Agency Issues 7,811,380 7,811,380
Lehman Brothers Inc. (Dated 6/30/03),
1.23%, Due 7/01/03 (Repurchase
proceeds $7,811,674); Collateralized by:
United States Government &
Agency Issues 7,811,380 7,811,380
--------------
23,434,140
--------------
Total Collateral Received for Securities
Lending 72,528,472
Repurchase Agreements 0.2%
State Street Bank (Dated 6/30/03), 0.75%
Due 7/01/03 (Repurchase proceeds
$3,928,082); Collateralized by United States
Government & Agency Issues (c) 3,928,000 3,928,000
United States Government Issues 0.0%
United States Treasury Bills,
Due 7/03/03 thru 7/17/03 (e) 500,000 529,920
- -------------------------------------------------------------------------------
Total Short-Term Investments (Cost $76,986,352) 76,986,392
- -------------------------------------------------------------------------------
Total Investments in Securities
(Cost $1,446,195,344) 104.5% 1,796,945,107
Other Assets and Liabilities, Net (4.5%) (78,121,154)
- -------------------------------------------------------------------------------
Net Assets 100.0% $1,718,823,953
===============================================================================
FUTURES
- --------------------------------------------------------------------------------
Underlying Unrealized
Expiration Face Amount Appreciation/
Date at Value (Depreciation)
- --------------------------------------------------------------------------------
Purchased:
30 Nasdaq 100 Futures 9/03 $ 3,613,500 $ (130,952)
WRITTEN OPTIONS ACTIVITY
- --------------------------------------------------------------------------------
Contracts Premiums
- --------------------------------------------------------------------------------
Options outstanding at beginning of period 500 $ 368,489
Options written during the period 7,075 1,211,655
Options closed (6,967) (1,522,503)
Options expired (605) (55,430)
Options exercised (3) (2,211)
------------ --------------
Options outstanding at end of period -- $ --
============ ==============
LEGEND
- --------------------------------------------------------------------------------
(a) Short-term investments include any security which has a remaining maturity
of less than one year and investments in money market funds.
(b) Non-income producing security.
(c) See Note 2(J) of Notes to Financial Statements.
(d) Restricted security.
(e) All or a portion of security pledged as collateral to cover margin
requirements on open futures contracts.
(f) See Note 2(M) of Notes to Financial Statements.
Percentages are stated as a percent of net assets.
See Notes to Financial Statements.
35
STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
(In Thousands, Except Per Share Amounts)
Strong Strong Strong
Blue Chip Discovery Endeavor
Fund Fund Fund
----------- ---------- --------
Assets:
Investments in Securities, at Value (Including Repurchase
Agreements of $14,576, $17,038 and $62, respectively)
(Cost of $164,582, $158,521 and $4,549, respectively) $ 184,596 $ 170,614 $ 5,002
Receivable for Securities Sold 2,102 1,256 --
Receivable for Fund Shares Sold 5 31 --
Dividends and Interest Receivable 53 48 1
Other Assets 61 35 9
----------- --------- --------
Total Assets 186,817 171,984 5,012
Liabilities:
Payable for Securities Purchased 2,743 11,636 20
Payable for Fund Shares Redeemed 71 4 --
Payable Upon Return of Securities on Loan -- 13,616 --
Cash Overdraft Liability -- 64 --
Accrued Operating Expenses and Other Liabilities 185 53 8
----------- --------- --------
Total Liabilities 2,999 25,373 28
----------- --------- --------
Net Assets $ 183,818 $ 146,611 $ 4,984
=========== ========= ========
Net Assets Consist of:
Capital Stock (Par Value and Paid-in Capital) $ 365,882 $ 149,379 $ 6,856
Undistributed Net Investment Income (Loss) (640) (304) (21)
Undistributed Net Realized Gain (Loss) (201,437) (14,557) (2,303)
Net Unrealized Appreciation (Depreciation) 20,013 12,093 452
----------- --------- --------
Net Assets $ 183,818 $ 146,611 $ 4,984
=========== ========= ========
Capital Shares Outstanding (Unlimited Number Authorized) 19,419 9,029 623
Net Asset Value Per Share $ 9.47 $ 16.24 $ 8.00
=========== ========= ========
See Notes to Financial Statements.
36
STATEMENTS OF ASSETS AND LIABILITIES (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
(In Thousands, Except Per Share Amounts)
Strong Strong Large Strong U.S.
Large Cap Company Emerging
Growth Fund Growth Fund Growth Fund
----------- ------------ -----------
Assets:
Investments in Securities, at Value (Cost of $592,882,
$32,428 and $54,741, respectively) $ 688,883 $ 35,191 $ 74,316
Receivable for Securities Sold 3,651 538 212
Receivable for Fund Shares Sold 13 173 74
Dividends and Interest Receivable 318 16 3
Variation Margin Receivable 11 -- --
Other Assets 102 14 8
----------- ----------- -----------
Total Assets 692,978 35,932 74,613
Liabilities:
Payable for Securities Purchased 11,064 2,383 439
Payable for Fund Shares Redeemed 4,007 7 4
Payable Upon Return of Securities on Loan 28,501 -- --
Accrued Operating Expenses and Other Liabilities 242 24 88
----------- ------------ -----------
Total Liabilities 43,814 2,414 531
----------- ------------ -----------
Net Assets $ 649,164 $ 33,518 $ 74,082
=========== ============ ===========
Net Assets Consist of:
Capital Stock (Par Value and Paid-in Capital) $ 1,141,851 $ 41,675 $ 123,500
Undistributed Net Investment Income (Loss) (1,324) (41) (571)
Undistributed Net Realized Gain (Loss) (587,179) (10,880) (68,422)
Net Unrealized Appreciation (Depreciation) 95,816 2,764 19,575
----------- ------------ -----------
Net Assets $ 649,164 $ 33,518 $ 74,082
=========== ============ ===========
Capital Shares Outstanding (Unlimited Number Authorized) 34,598 2,802 6,186
Net Asset Value Per Share $ 18.76 $ 11.96 $ 11.98
=========== ============ ===========
See Notes to Financial Statements.
37
STATEMENTS OF ASSETS AND LIABILITIES (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
(In Thousands,
Except As Noted)
Strong
Enterprise
Fund
--------------
Assets:
Investments in Securities, at Value (Cost of $257,708) $ 289,381
Receivable for Securities Sold 2,013
Receivable for Fund Shares Sold 8
Dividends and Interest Receivable 43
Other Assets 43
--------------
Total Assets 291,488
Liabilities:
Payable for Securities Purchased 1,504
Payable for Fund Shares Redeemed 1,305
Payable Upon Return of Securities on Loan 30,865
Accrued Operating Expenses and Other Liabilities 421
--------------
Total Liabilities 34,095
--------------
Net Assets $ 257,393
==============
Net Assets Consist of:
Capital Stock (Par Value and Paid-in Capital) $ 593,905
Undistributed Net Investment Income (Loss) (1,660)
Undistributed Net Realized Gain (Loss) (366,526)
Net Unrealized Appreciation (Depreciation) 31,674
--------------
Net Assets $ 257,393
==============
Investor Class ($ and shares in full)
Net Assets $ 239,275,544
Capital Shares Outstanding (Unlimited Number Authorized) 13,047,403
Net Asset Value Per Share $ 18.34
==============
Advisor Class ($ and shares in full)
Net Assets $ 1,634,044
Capital Shares Outstanding (Unlimited Number Authorized) 89,184
Net Asset Value Per Share $ 18.32
==============
Class K ($ and shares in full)
Net Assets $ 16,483,799
Capital Shares Outstanding (Unlimited Number Authorized) 893,224
Net Asset Value Per Share $ 18.45
==============
See Notes to Financial Statements.
38
STATEMENTS OF ASSETS AND LIABILITIES (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
(In Thousands,
Except As Noted)
Strong
Growth 20
Fund
--------------
Assets:
Investments in Securities, at Value (Cost of $249,354) $ 284,378
Receivable for Fund Shares Sold 38
Dividends and Interest Receivable 10
Other Assets 35
--------------
Total Assets 284,461
Liabilities:
Payable for Securities Purchased 3,384
Payable for Fund Shares Redeemed 4,035
Accrued Operating Expenses and Other Liabilities 240
--------------
Total Liabilities 7,659
--------------
Net Assets $ 276,802
==============
Net Assets Consist of:
Capital Stock (Par Value and Paid-in Capital) $ 657,240
Undistributed Net Investment Income (Loss) (1,948)
Undistributed Net Realized Gain (Loss) (413,513)
Net Unrealized Appreciation (Depreciation) 35,023
--------------
Net Assets $ 276,802
==============
Investor Class ($ and shares in full)
Net Assets $ 269,972,637
Capital Shares Outstanding (Unlimited Number Authorized) 23,834,758
Net Asset Value Per Share $ 11.33
==============
Advisor Class ($ and shares in full)
Net Assets $ 6,829,106
Capital Shares Outstanding (Unlimited Number Authorized) 602,134
Net Asset Value Per Share $ 11.34
==============
See Notes to Financial Statements.
39
STATEMENTS OF ASSETS AND LIABILITIES (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
(In Thousands,
Except As Noted)
Strong
Growth Fund
----------------
Assets:
Investments in Securities, at Value (Cost of $1,446,195) $ 1,796,945
Receivable for Securities Sold 16,654
Receivable for Fund Shares Sold 107
Dividends and Interest Receivable 221
Variation Margin Receivable 6
Other Assets 173
----------------
Total Assets 1,814,106
Liabilities:
Payable for Securities Purchased 19,769
Payable for Fund Shares Redeemed 2,263
Payable Upon Return of Securities on Loan 72,528
Accrued Operating Expenses and Other Liabilities 722
----------------
Total Liabilities 95,282
----------------
Net Assets $ 1,718,824
================
Net Assets Consist of:
Capital Stock (Par Value and Paid-in Capital) $ 2,480,281
Undistributed Net Investment Income (Loss) (7,806)
Undistributed Net Realized Gain (Loss) (1,104,270)
Net Unrealized Appreciation (Depreciation) 350,619
----------------
Net Assets $ 1,718,824
================
Investor Class ($ and shares in full)
Net Assets $ 1,399,050,010
Capital Shares Outstanding (Unlimited Number Authorized) 92,439,130
Net Asset Value Per Share $ 15.13
================
Institutional Class ($ and shares in full)
Net Assets $ 265,234,266
Capital Shares Outstanding (Unlimited Number Authorized) 17,120,504
Net Asset Value Per Share $ 15.49
================
Advisor Class ($ and shares in full)
Net Assets $ 11,262,141
Capital Shares Outstanding (Unlimited Number Authorized) 748,422
Net Asset Value Per Share $ 15.05
================
Class C ($ and shares in full)
Net Assets $ 282,507
Capital Shares Outstanding (Unlimited Number Authorized) 18,749
Net Asset Value Per Share $ 15.07
================
Class K ($ and shares in full)
Net Assets $ 42,995,029
Capital Shares Outstanding (Unlimited Number Authorized) 2,816,328
Net Asset Value Per Share $ 15.27
================
See Notes to Financial Statements.
40
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
For the Six Months Ended June 30, 2003 (Unaudited)
(In Thousands)
Strong Strong Strong
Blue Chip Discovery Endeavor
Fund Fund Fund
--------- --------- --------
Income:
Dividends - Unaffiliated Issuers (net of foreign withholding taxes
of $0, $2 and $0, respectively) $ 845 $ 583 $ 17
Dividends - Affiliated Issuers -- 5 --
Interest 43 76 1
--------- --------- --------
Total Income 888 664 18
Expenses:
Investment Advisory Fees 434 500 16
Administrative Fees 261 167 6
Custodian Fees 6 13 3
Shareholder Servicing Costs 685 242 14
Reports to Shareholders 127 48 2
Brokerage Fees 2 1 --
12b-1 Fees -- -- 5
Professional Fees 8 8 7
Federal and State Registration Fees 9 11 9
Other 42 14 1
--------- --------- --------
Total Expenses before Expense Offsets 1,574 1,004 63
Expense Offsets (Note 4) (46) (29) (24)
--------- --------- --------
Expenses, Net 1,528 975 39
--------- --------- --------
Net Investment Income (Loss) (640) (311) (21)
Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on Investments (29,648) 2,873 80
Net Change in Unrealized Appreciation/Depreciation on Investments 48,041 13,672 481
--------- --------- --------
Net Gain (Loss) on Investments 18,393 16,545 561
--------- --------- --------
Net Increase (Decrease) in Net Assets Resulting from Operations $ 17,753 $ 16,234 $ 540
========= ========= ========
See Notes to Financial Statements.
41
STATEMENTS OF OPERATIONS (continued)
- --------------------------------------------------------------------------------
For the Six Months Ended June 30, 2003 (Unaudited)
(In Thousands)
Strong Strong Large Strong U.S.
Large Cap Company Emerging
Growth Fund Growth Fund Growth Fund
----------- ----------- -----------
Income:
Dividends - Unaffiliated Issuers (net of foreign withholding
taxes of $18, $0 and $0, respectively) $ 2,310 $ 129 $ 10
Dividends - Affiliated Issuers 1 -- --
Interest 148 7 7
----------- ----------- -----------
Total Income 2,459 136 17
Expenses:
Investment Advisory Fees 1,653 88 227
Administrative Fees 899 35 91
Custodian Fees 36 3 9
Shareholder Servicing Costs 1,017 16 244
Reports to Shareholders 173 29 35
Brokerage Fees 2 -- 1
12b-1 Fees -- 29 --
Professional Fees 11 (16) 7
Federal and State Registration Fees 13 16 11
Other 46 17 8
----------- ----------- -----------
Total Expenses before Expense Offsets 3,850 217 633
Expense Offsets (Note 4) (67) (40) (45)
----------- ----------- -----------
Expenses, Net 3,783 177 588
----------- ----------- -----------
Net Investment Income (Loss) (1,324) (41) (571)
Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on:
Investments (3,511) (102) 842
Written Options 254 -- --
Futures Contracts 4,289 -- --
----------- ----------- -----------
Net Realized Gain (Loss) 1,032 (102) 842
Net Change in Unrealized Appreciation/Depreciation on:
Investments 78,599 2,973 11,399
Futures Contracts 306 -- --
----------- ----------- -----------
Net Change in Unrealized Appreciation/Depreciation 78,905 2,973 11,399
----------- ----------- -----------
Net Gain (Loss) on Investments 79,937 2,871 12,241
----------- ----------- -----------
Net Increase (Decrease) in Net Assets Resulting from Operations $ 78,613 $ 2,830 $ 11,670
=========== =========== ===========
See Notes to Financial Statements.
42
STATEMENTS OF OPERATIONS (continued)
- --------------------------------------------------------------------------------
For the Six Months Ended June 30, 2003 (Unaudited)
(In Thousands)
Strong Strong Strong
Enterprise Growth 20 Growth
Fund Fund Fund
---------- --------- ---------
Income:
Dividends - Unaffiliated Issuers (net of foreign withholding taxes
of $8, $1 and $73, respectively) $ 468 $ 163 $ 3,202
Dividends - Affiliated Issuers -- -- 50
Interest 71 111 145
---------- --------- ---------
Total Income 539 274 3,397
Expenses (Note 4):
Investment Advisory Fees 866 936 5,720
Administrative Fees 343 374 1,969
Custodian Fees 11 13 42
Shareholder Servicing Costs 1,004 743 2,887
Reports to Shareholders 226 168 487
12b-1 Fees 2 8 13
Other 74 52 212
---------- --------- ---------
Total Expenses before Expense Offsets 2,526 2,294 11,330
Expense Offsets (327) (72) (127)
---------- --------- ---------
Expenses, Net 2,199 2,222 11,203
---------- --------- ---------
Net Investment Income (Loss) (1,660) (1,948) (7,806)
Realized and Unrealized Gain (Loss):
Net Realized Gain (Loss) on:
Investments 6,978 31 2,713
Written Options -- (460) (587)
Futures Contracts -- 1,104 678
---------- --------- ---------
Net Realized Gain (Loss) 6,978 675 2,804
Net Change in Unrealized Appreciation/Depreciation on:
Investments 29,011 27,348 222,675
Written Options -- -- (271)
Futures Contracts -- -- (131)
---------- --------- ---------
Net Change in Unrealized Appreciation/Depreciation 29,011 27,348 222,273
---------- --------- ---------
Net Gain (Loss) on Investments 35,989 28,023 225,077
---------- --------- ---------
Net Increase (Decrease) in Net Assets Resulting from Operations $ 34,329 $ 26,075 $ 217,271
========== ========= =========
See Notes to Financial Statements.
43
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
(In Thousands)
Strong Blue Chip Fund Strong Discovery Fund
--------------------------------- --------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002 June 30, 2003 Dec. 31, 2002
---------------- ------------- ---------------- -------------
(Unaudited) (Unaudited)
Operations:
Net Investment Income (Loss) $ (640) $ (1,903) $ (311) $ (548)
Net Realized Gain (Loss) (29,648) (50,225) 2,873 (17,115)
Net Change in Unrealized Appreciation/Depreciation 48,041 (40,555) 13,672 (1,218)
---------------- ------------ ---------------- -------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 17,753 (92,683) 16,234 (18,881)
Distributions from Net Realized Gains -- -- -- (4,117)
Capital Share Transactions (Note 6):
Net Increase (Decrease) in Net Assets from
Capital Share Transactions (37,227) (43,020) (2,984) (1,907)
---------------- ------------ ---------------- -------------
Total Increase (Decrease) in Net Assets (19,474) (135,703) 13,250 (24,905)
Net Assets:
Beginning of Period 203,292 338,995 133,361 158,266
---------------- ------------ ---------------- -------------
End of Period $ 183,818 $ 203,292 $ 146,611 $ 133,361
================ ============ ================ =============
Undistributed Net Investment Income (Loss) $ (640) $ -- $ (304) $ 7
Strong Endeavor Fund Strong Large Cap Growth Fund
--------------------------------- --------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002 June 30, 2003 Dec. 31, 2002
---------------- ------------- ---------------- -------------
(Unaudited) (Unaudited)
Operations:
Net Investment Income (Loss) $ (21) $ (57) $ (1,324) $ (2,758)
Net Realized Gain (Loss) 80 (1,459) 1,032 (168,104)
Net Change in Unrealized Appreciation/Depreciation 481 (232) 78,905 (103,040)
---------------- ------------- ---------------- -------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 540 (1,748) 78,613 (273,902)
Distributions from Net Investment Income -- -- -- --
Capital Share Transactions (Note 6):
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 769 (794) (18,343) (113,540)
---------------- ------------- ---------------- -------------
Total Increase (Decrease) in Net Assets 1,309 (2,542) 60,270 (387,442)
Net Assets:
Beginning of Period 3,675 6,217 588,894 976,336
---------------- ------------- ---------------- -------------
End of Period $ 4,984 $ 3,675 $ 649,164 $ 588,894
================ ============= ================ =============
Undistributed Net Investment Income (Loss) $ (21) $ -- $ (1,324) $ --
See Notes to Financial Statements.
44
STATEMENTS OF CHANGES IN NET ASSETS (continued)
- --------------------------------------------------------------------------------
(In Thousands)
Strong U.S. Emerging
Strong Large Company Growth Fund Growth Fund
------------------------------------------------- --------------------------------
Six Months Ended Period Ended Year Ended Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002 Sept. 30, 2002 June 30, 2003 Dec. 31, 2002
---------------- ------------- -------------- ---------------- -------------
(Unaudited) (Unaudited)
Operations:
Net Investment Income (Loss) $ (41) $ 14 $ 703 $ (571) $ (1,384)
Net Realized Gain (Loss) (102) (1,310) (4,671) 842 (22,207)
Net Change in Unrealized Appreciation/
Depreciation 2,973 2,206 653 11,399 (8,450)
---------------- ------------- -------------- ---------------- -------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 2,830 910 (3,315) 11,670 (32,041)
Distributions:
From Net Investment Income (14) (77) (631) -- --
From Net Realized Gains -- -- (69) -- --
---------------- ------------- -------------- ---------------- -------------
Total Distributions (14) (77) (700) -- --
Capital Share Transactions (Note 6):
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 9,327 2,321 (10,937) 3,998 4,156
---------------- ------------- -------------- ---------------- -------------
Total Increase (Decrease) in Net Assets 12,143 3,154 (14,952) 15,668 (27,885)
Net Assets:
Beginning of Period 21,375 18,221 33,173 58,414 86,299
---------------- ------------- -------------- ---------------- -------------
End of Period $ 33,518 $ 21,375 $ 18,221 $ 74,082 $ 58,414
================ ============= ============== ================ =============
Undistributed Net Investment Income (Loss) $ (41) $ 14 $ 77 $ (571) $ --
Strong Enterprise Fund Strong Growth 20 Fund
--------------------------------- --------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002 June 30, 2003 Dec. 31, 2002
---------------- ------------- ---------------- -------------
(Unaudited) (Unaudited)
Operations:
Net Investment Income (Loss) $ (1,660) $ (4,456) $ (1,948) $ (3,854)
Net Realized Gain (Loss) 6,978 (68,214) 675 (42,684)
Net Change in Unrealized Appreciation/Depreciation 29,011 (28,578) 27,348 (53,067)
---------------- ------------- ---------------- -------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 34,329 (101,248) 26,075 (99,605)
Distributions from Net Investment Income -- -- -- --
Capital Share Transactions (Note 6):
Net Increase (Decrease) in Net Assets from
Capital Share Transactions (6,292) (42,799) 60,517 (81,964)
---------------- ------------- ---------------- -------------
Total Increase (Decrease) in Net Assets 28,037 (144,047) 86,592 (181,569)
Net Assets:
Beginning of Period 229,356 373,403 190,210 371,779
---------------- ------------- ---------------- -------------
End of Period $ 257,393 $ 229,356 $ 276,802 $ 190,210
================ ============= ================ =============
Undistributed Net Investment Income (Loss) $ (1,660) $ -- $ (1,948) $ --
See Notes to Financial Statements.
45
STATEMENTS OF CHANGES IN NET ASSETS (continued)
- --------------------------------------------------------------------------------
(In Thousands)
Strong Growth Fund
--------------------------------
Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002
---------------- -------------
(Unaudited)
Operations:
Net Investment Income (Loss) $ (7,806) $ (19,533)
Net Realized Gain (Loss) 2,804 (268,584)
Net Change in Unrealized Appreciation/Depreciation 222,273 (230,635)
---------------- -------------
Net Increase (Decrease) in Net Assets Resulting from Operations 217,271 (518,752)
Distributions from Net Investment Income -- --
Capital Share Transactions (Note 6):
Net Increase (Decrease) in Net Assets from Capital Share Transactions 27,239 (115,867)
---------------- -------------
Total Increase (Decrease) in Net Assets 244,510 (634,619)
Net Assets:
Beginning of Period 1,474,314 2,108,933
---------------- -------------
End of Period $ 1,718,824 $ 1,474,314
================ =============
Undistributed Net Investment Income (Loss) $ (7,806) $ --
See Notes to Financial Statements.
46
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
1. Organization
The accompanying financial statements represent the Strong Growth Funds
(the "Funds"), which include the following Funds, each with its own
investment objectives and policies:
- Strong Blue Chip Fund/(1)/ (a series of Strong Conservative Equity
Funds, Inc.)
- Strong Discovery Fund/(1)/ (a series of Strong Discovery Fund, Inc.)
- Strong Endeavor Fund/(1)/ (a series of Strong Opportunity Fund, Inc.)
- Strong Large Cap Growth Fund/(1)/ (a series of Strong Large Cap Growth
Fund, Inc.)
- Strong Large Company Growth Fund/(1)/ (a series of Strong Equity Funds,
Inc.)
- Strong U.S. Emerging Growth Fund/(1)/ (a series of Strong Equity Funds,
Inc.)
- Strong Enterprise Fund/(1)/ (a series of Strong Equity Funds, Inc.)
- Strong Growth 20 Fund/(2)/ (a series of Strong Equity Funds, Inc.)
- Strong Growth Fund/(1)/ (a series of Strong Equity Funds, Inc.)
/(1)/ Diversified Fund.
/(2)/ Non-diversified Fund.
Each Fund is an open-end management investment company registered under the
Investment Company Act of 1940, as amended ("1940 Act").
Investor Class shares are available to the general public, Institutional
Class shares are available only to investors that meet certain higher
minimum investment minimums, Advisor Class shares and Class C shares are
available only through financial professionals and Class K shares are
available only through programs managed by Strong Capital Management, Inc.
(the "Advisor"). Strong Blue Chip Fund, Strong Discovery Fund, Strong
Endeavor Fund, Strong Large Cap Growth Fund and Strong U.S. Emerging Growth
Fund offer Investor Class shares. Strong Large Company Growth Fund offers
Investor Class and Class K shares. Strong Enterprise Fund offers Investor
Class, Institutional Class, Advisor Class and Class K shares. Strong Growth
20 Fund offers Investor Class and Advisor Class shares. Strong Growth Fund
offers Investor Class, Institutional Class, Advisor Class, Class C and
Class K shares. All classes differ principally in their respective
shareholder servicing and distribution expenses and sales charges. All
classes of shares have identical rights to earnings, assets and voting
privileges, except for class specific expenses and exclusive rights to vote
on matters affecting only individual classes.
After the close of business on June 30, 2003, Strong Enterprise Fund issued
an additional class of shares: Institutional Class Shares.
After the close of business on June 30, 2003, Strong Large Company Growth
Fund implemented a multi-class structure whereby the Fund is authorized to
offer two classes of shares: Investor Class and Class K. Shares outstanding
prior to June 30, 2003 were designated as Investor Class shares.
2. Significant Accounting Policies
The following is a summary of significant accounting policies followed by
the Funds in the preparation of their financial statements.
(A) Security Valuation -- Securities of the Funds traded on a national
securities exchange are valued each business day at the last sales
price. Securities traded on the NASDAQ Stock Market are valued each
business day using the NASDAQ Official Closing Price ("NOCP").
Exchange-traded securities for which there were no transactions and
NASDAQ-traded securities for which there is no NOCP are valued at the
mean of the bid and ask prices. Securities for which market quotations
are not readily available are valued at fair value as determined in
good faith under the general supervision of the Board of Directors.
Occasionally, events affecting the value of foreign investments and
exchange rates occur between the time at which those items are
determined and the close of trading on the New York Stock Exchange.
Such events would not normally be reflected in a calculation of the
Funds' net asset values on that day. If events that materially affect
the value of the Funds' foreign investments or the foreign currency
exchange rates occur during such period, the investments will be
valued at their fair value as determined in good faith under the
general supervision of the Board of Directors. Securities that are
purchased within 60 days of their stated maturity are valued at
amortized cost, which approximates fair value.
The Funds may own certain investment securities that are restricted as
to resale or are deemed illiquid. Restricted securities are Section
4(2) commercial paper or are eligible for resale pursuant to Rule 144A
under the Securities Act of 1933. Securities are deemed illiquid based
upon guidelines established by the Funds' Board of Directors. These
securities are valued after giving due consideration to pertinent
factors, such as recent private sales, market conditions and the
issuer's financial performance. The Funds generally bear the costs, if
any, associated with the disposition of restricted securities. The
Funds held no restricted and illiquid securities at June 30, 2003.
47
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
(B) Federal Income and Excise Taxes and Distributions to Shareholders --
The Funds intend to comply with the requirements of the Internal
Revenue Code of 1986, as amended, applicable to regulated investment
companies and to distribute substantially all of their taxable income
to their shareholders in a manner which results in no tax cost to the
Funds. Therefore, no federal income or excise tax provision is
recorded.
Undistributed income or net realized gains for financial statement
purposes may differ from federal income tax purposes due to
differences in the timing, recognition and characterization of income,
expense and capital gain items for financial statement and tax
purposes. Where appropriate, reclassifications between net asset
accounts are made for such differences that are permanent in nature.
The Funds may utilize earnings and profits distributed to shareholders
on redemption of shares as part of the dividends paid deduction.
Strong Discovery Fund, Strong Endeavor Fund, Strong U.S. Emerging
Growth Fund, Strong Enterprise Fund, Strong Growth 20 Fund and Strong
Growth Fund generally pay dividends from net investment income and
distribute net capital gains, if any, that they realize at least
annually. Strong Large Cap Growth Fund, Strong Large Company Growth
Fund and Strong Blue Chip Fund generally pay dividends from net
investment income and distribute net capital gains, if any, that they
realize quarterly.
(C) Realized Gains and Losses on Investment Transactions -- Investment
security transactions are recorded as of the trade date. Gains or
losses realized on investment transactions are determined by comparing
the identified cost of the security lot sold with the net sales
proceeds.
(D) Certain Investment Risks -- The Funds may utilize derivative
instruments including options, futures and other instruments with
similar characteristics to the extent that they are consistent with
the Funds' investment objectives and limitations. The Funds intend to
use such derivative instruments primarily to hedge or protect from
adverse movements in securities prices, foreign currencies or interest
rates. The use of these instruments may involve risks such as the
possibility that the value of the underlying assets fluctuates, the
derivative becomes illiquid, imperfect correlation exists between the
value of the instruments and the underlying securities, or that the
counterparty fails to perform its obligations.
Investments in foreign-denominated assets or forward currency
contracts may involve greater risks than domestic investments due to
currency rate fluctuations, political and economic instability,
different financial reporting standards and taxes, less liquidity,
less strict regulation of securities markets and smaller markets with
lower trading volume.
(E) Futures -- Upon entering into a futures contract, the Funds deposit in
a segregated account with their custodian, in the name of the broker,
cash and/or other liquid investments equal to the minimum "initial
margin" requirements of the exchange. Each Fund designates liquid
securities as collateral on open futures contracts. The Funds also
receive from or pay to the broker an amount of cash equal to the daily
fluctuation in the value of the futures contract. Such receipts or
payments are known as "variation margin" and are recorded as
unrealized gains or losses. When the futures contract is closed, a
realized gain or loss is recorded equal to the difference between the
value of the contract at the time it was opened and the value at the
time it was closed.
(F) Options -- The Funds may write put or call options. Premiums received
by the Funds upon writing put or call options are recorded as an asset
with a corresponding liability that is subsequently adjusted to the
current market value of the option. Changes between the initial
premiums received and the current market value of the options are
recorded as unrealized gains or losses. When an option is closed,
expired or exercised, the Funds realize a gain or loss and the
liability is eliminated. The Funds continue to bear the risk of
adverse movements in the price of the underlying asset during the
period of the option, although any potential loss during the period
would be reduced by the amount of the option premium received. Each
Fund designates liquid securities as collateral on open options
contracts.
(G) Foreign Currency Translation -- Investment securities and other assets
and liabilities initially expressed in foreign currencies are
converted daily to U.S. dollars based upon current exchange rates.
Purchases and sales of foreign investment securities and income are
converted to U.S. dollars based upon currency exchange rates
prevailing on the respective dates of such transactions. The effect of
changes in foreign exchange rates on realized and unrealized security
gains or losses is reflected as a component of such gains or losses.
(H) Forward Foreign Currency Exchange Contracts -- Forward foreign
currency exchange contracts are valued at the forward rate and are
marked-to-market daily. The change in market value is recorded as an
unrealized gain or loss. When the contract is closed, the Funds record
an exchange gain or loss equal to the difference between the value of
the contract at the time it was opened and the value at the time it
was closed.
48
- --------------------------------------------------------------------------------
(I) Short Positions -- The Funds may engage in short sale transactions.
For financial statement purposes, an amount equal to the settlement
amount is included in the Statements of Assets and Liabilities as an
asset and an equivalent liability. The amount of the liability is
subsequently marked-to-market to reflect the current value of the
short position. The Funds are liable for any dividends payable on
securities while those securities are in a short position. If the
Funds sell securities short while also holding the long position, they
may protect unrealized gains but will lose the opportunity to profit
on such securities if the price rises. If the Funds sell securities
short when not holding the long position, they will experience a loss
if the market price of the security increases between the date of the
short sale and the date the security is replaced.
(J) Repurchase Agreements -- The Funds may enter into repurchase
agreements with institutions that the Advisor has determined are
creditworthy. Each repurchase agreement is recorded at cost, which
approximates fair value. The Funds require that the collateral,
represented by securities (primarily U.S. government securities), in a
repurchase transaction be maintained in a segregated account with a
custodian bank in a manner sufficient to enable the Funds to obtain
those securities in the event of a default of the counterparty. On a
daily basis, the Advisor monitors the value of the collateral,
including accrued interest, to ensure it is at least equal to the
amounts owed to the Funds under each repurchase agreement.
(K) Directed Brokerage -- The Funds direct certain portfolio trades to
brokers who, in turn, pay a portion of the Funds' expenses not
attributable to the Advisor or its affiliates. Such amounts are
included in Expense Offsets reported in the Funds' Statements of
Operations and in Note 4.
(L) Earnings Credit Arrangements -- Credits are earned on positive cash
balances maintained in custodian accounts. These credits serve to
reduce the custodian's fees incurred by certain Funds and are included
in Expense Offsets reported in the Funds' Statements of Operations and
in Note 4.
(M) Securities Lending -- The Funds have entered into a Securities Lending
Agreement (the "Agreement") with Deutsche Bank. Under the terms of the
Agreement, the Funds may lend portfolio securities to qualified
institutional borrowers in order to earn additional income. The
Agreement requires that loans are collateralized at all times by cash
equal to at least 102% of the market value of any loaned securities,
plus accrued interest.
At June 30, 2003, Strong Discovery Fund, Strong Large Cap Growth Fund,
Strong Enterprise Fund and Strong Growth Fund had securities with a
market value of $13,172,789, $27,664,700, $29,767,155 and $70,683,224,
respectively, on loan and had received $13,616,491, $28,500,650,
$30,865,301 and $72,528,472, respectively, in collateral (both
included within Investments in the Statements of Assets and
Liabilities). Amounts earned as interest on investments of cash
collateral, net of rebates and other securities lending expenses, are
included in Interest in the Statements of Operations. For the six
months ended June 30, 2003, this securities lending income totaled
$6,892, $7,919, $13,125 and $21,100, respectively.
The three primary risks associated with securities lending are: a
borrower defaulting on its obligation to return the securities loaned
resulting in a shortfall on the posted collateral; a principal loss
arising from the lending agent's investment of cash collateral; and
the inability of the lending Fund to recall a security in time to
exercise valuable voting rights or sell the security.
(N) Expenses -- The Funds and other affiliated Strong Funds contract for
certain services on a collective basis. The majority of the expenses
are directly identifiable to an individual Fund. Expenses that are not
readily identifiable to a specific Fund will be allocated in such a
manner as deemed equitable, taking into consideration, among other
things, the nature and type of expense and the relative sizes of the
Strong Funds.
(O) Use of Estimates -- The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and
assumptions that affect the reported amounts in these financial
statements. Actual results could differ from those estimates.
(P) Other -- Dividend income and distributions to shareholders are
recorded on the ex-dividend date. Interest income is recorded on the
accrual basis and includes amortization of premiums and discounts on
the interest method. Income, expenses (other than expenses
attributable to a specific class), and realized and unrealized gains
or losses on investments are allocated to each class of shares based
on its relative shares outstanding.
(Q) Redemption Fees -- Investor Class shares of Strong Large Company
Growth Fund held for less than one year are subject to a redemption
fee of 1.00%, based on the redeemed share's market value. Redemption
fees are paid directly to the Fund. The amount collected for the six
months ended June 30, 2003 was $3,621.
49
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
3. Related Party Transactions
The Advisor provides investment advisory and related services to the Funds.
Strong Investor Services, Inc. (the "Administrator"), an affiliate of the
Advisor, provides administrative, transfer agent and related services to
the Funds. Certain officers and directors of the Funds are affiliated with
the Advisor and the Administrator. Investment advisory and administration
fees, which are established by terms of the advisory and administration
agreements, are based on the following annualized rates of the average
daily net assets of the respective Fund:
Administrative Fees
----------------------------------------------------------------------
Advisory Fees Investor Class Institutional Class Advisor Class Class C Class K
------------- -------------- ------------------- ------------- ------- -------
Strong Blue Chip Fund 0.50% 0.30% * * * *
Strong Discovery Fund 0.75% 0.25% * * * *
Strong Endeavor Fund 0.75%/(1)/ 0.30% * * * *
Strong Large Cap Growth Fund 0.60%/(2)/ 0.30% * * * *
Strong Large Company Growth Fund 0.75%/(1)/ 0.30% * * * *
Strong U.S. Emerging Growth Fund 0.75%/(1)/ 0.30% * * * *
Strong Enterprise Fund 0.75%/(1)/ 0.30% * 0.30% * 0.25%
Strong Growth 20 Fund 0.75%/(1)/ 0.30% * 0.30% * *
Strong Growth Fund 0.75%/(1)/ 0.30% 0.02% 0.30% 0.30% 0.25%
* Does not offer share class.
/(1)/ The investment advisory fees are 0.75% for the first $4 billion in
net assets, 0.725% for the next $2 billion, and 0.70% for net assets
$6 billion and above.
/(2)/ The investment advisory fees are 0.60% of the first $35 million in
net assets and 0.55% for net assets $35 million and above.
The Funds' Advisor and/or Administrator may voluntarily waive or absorb
certain expenses at their discretion. The Funds' Advisor and/or
Administrator has contractually agreed to waive its fees and/or absorb
expenses for the Investor Class shares of the Strong Large Company Growth
Fund to keep Total Annual Operating Expenses at no more than 1.50%. This
agreement may only be terminated by the Board of Directors of the Funds.
The Advisor and/or Administrator has contractually agreed to waive and/or
absorb expenses until May 1, 2004, to keep Total Annual Operating Expenses
of the Investor Class of Strong Endeavor Fund at no more than 2.00%, the
Investor Class of Strong Enterprise Fund at no more than 2.00%, Class K of
Strong Enterprise Fund at no more than 1.20% and Class K of Strong Growth
Fund at no more than 0.99%. Transfer agent and related service fees for the
Investor Class are paid at a rate of $27.00 for each open shareholder
account and $4.20 for each closed shareholder account. Transfer agent and
related service fees for the Institutional Class, Advisor Class, Class C
and Class K are paid at an annual rate of 0.015%, 0.20%, 0.20% and 0.20%,
respectively, of the average daily net asset value of each respective
class. The Administrator also allocates to each Fund certain charges or
credits resulting from transfer agency banking activities based on each
Class' level of subscription and redemption activity. Transfer Agency
Banking Charges allocated to the Funds by the Administrator, if any, are
included in Other Expenses in the Funds' Statements of Operations. Transfer
Agency Banking Credits allocated by the Administrator, if any, serve to
reduce the transfer agent expenses incurred by the Funds and are included
in Expense Offsets in the Funds' Statements of Operations. The
Administrator is also compensated for certain other out-of-pocket expenses
related to transfer agent services.
Next Century Growth Investors, LLC ("Next Century Growth"), an affiliate of
the Advisor, manages the investments of Strong U.S. Emerging Growth Fund
under a subadvisory agreement with the Advisor. Next Century Growth is
compensated by the Advisor (not the Fund) and bears all of its own expenses
in providing subadvisory services.
Strong Endeavor Fund, Strong Large Company Growth Fund, Strong Enterprise
Fund, Strong Growth 20 Fund and Strong Growth Fund have adopted a Rule
12b-1 distribution and service plan under the 1940 Act on behalf of the
Investor Class shares of Strong Endeavor Fund and Strong Large Company
Growth Fund, the Advisor Class shares of Strong Enterprise Fund, Strong
Growth 20 Fund and Strong Growth Fund and the Class C shares of Strong
Growth Fund. Under the plan, Strong Investments, Inc. (the "Distributor,"
and an affiliate of the Advisor) is paid an annual rate of 0.25% of the
average daily net assets of the Investor Class shares and the Advisor Class
shares and 1.00% for Class C shares as compensation for services provided
and expenses incurred, including amounts paid to brokers or dealers, in
connection with the sale of each Class' shares. See Note 4.
Strong Growth Fund's Class C shares have a 1.00% contingent deferred sales
charge if shares are sold within one year of their original purchase date.
For the six months ended June 30, 2003, the Distributor received no
aggregate contingent deferred sales charges from the redemption of Class C
shares for Strong Growth Fund. Sales charges are not an expense of the
Funds and are not reflected in the financial statements of the Funds. Sales
charges may be waved in limited circumstances.
The Funds may invest cash in money market funds managed by the Advisor,
subject to certain limitations.
50
- --------------------------------------------------------------------------------
Certain information regarding related party transactions, excluding the
effects of waivers and absorptions, for the six months ended June 30, 2003,
is as follows:
Payable to/
(Receivable from)
Advisor or Shareholder Servicing Transfer Agency Unaffiliated
Administrator at and Other Expenses Banking Directors'
June 30, 2003 Paid to Administrator Charges/(Credits) Fees
----------------- --------------------- ----------------- ------------
Strong Blue Chip Fund $ 123,773 $ 686,776 $ 9,154 $ 4,724
Strong Discovery Fund 37,618 242,123 884 2,618
Strong Endeavor Fund 2,431 13,720 16 323
Strong Large Cap Growth Fund 179,407 1,018,979 13,385 13,462
Strong Large Company Growth Fund 2,335 16,168 1,853 599
Strong U.S. Emerging Growth Fund 65,167 245,622 1,397 1,426
Strong Enterprise Fund 289,232 1,007,658 10,108 5,311
Strong Growth 20 Fund 139,196 745,803 7,084 4,698
Strong Growth Fund 585,236 2,892,854 26,852 31,038
4. Expenses and Expense Offsets
For the six months ended June 30, 2003, the class specific expenses are as
follows:
Administrative Shareholder Reports to
Fees Servicing Costs Shareholders 12b-1 Fees Other
-------------- --------------- ------------ ---------- --------
Strong Enterprise Fund
Investor Class $ 324,593 $ 989,400 $ 224,413 $ -- $ 12,209
Advisor Class 1,984 1,344 321 1,653 31
Class K 16,736 13,417 1,073 -- 1,365
Strong Growth 20 Fund
Investor Class 364,237 736,686 166,684 -- 9,475
Advisor Class 9,589 6,411 1,034 7,991 314
Strong Growth Fund
Investor Class 1,893,462 2,829,513 383,034 -- 18,299
Institutional Class 22,261 17,267 101,655 -- 13,275
Advisor Class 15,042 10,079 1,777 12,535 228
Class C 225 154 180 755 18
Class K 37,810 30,135 7 -- 737
51
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
For the six months ended June 30, 2003, the expense offsets are as follows:
Expense Directed
Waivers and Brokerage Earnings
Absorptions Credits Credits
----------- ---------- ----------
Strong Blue Chip Fund $ -- $ (45,755) $ (143)
Strong Discovery Fund -- (28,755) (168)
Strong Endeavor Fund (22,754) (909) (2)
Strong Large Cap Growth Fund -- (63,181) (3,633)
Strong Large Company Growth Fund (40,413) -- (10)
Strong U.S. Emerging Growth Fund (36,854) (7,474) (342)
Strong Enterprise Fund
Investor Class (292,992) -- --
Advisor Class -- -- --
Class K (6,829) -- --
Fund Level -- (27,080) (323)
Strong Growth 20 Fund
Investor Class (43,872) -- --
Advisor Class -- -- --
Fund Level -- (27,061) (929)
Strong Growth Fund
Investor Class -- -- --
Institutional Class -- -- --
Advisor Class -- -- --
Class C (4) -- --
Class K (37,755) -- --
Fund Level -- (88,144) (1,473)
5. Investments in Affiliates
Affiliated issuers, as defined under the 1940 Act, include any fund in the
Strong Family of Funds and any issuer in which the Fund's holdings of an
issuer represent 5% or more of the outstanding voting securities of the
issuer. A summary of transactions in the securities of these issuers during
the six months ended June 30, 2003 is as follows:
Balance of Gross Gross Sales Balance of Value Dividend Income
Shares Held Purchases and Shares Held June 30, Jan. 1, 2003 -
Jan. 1, 2003 and Additions Reductions June 30, 2003 2003 June 30, 2003
------------ ------------- ------------ ------------- -------- ---------------
Strong Discovery Fund
---------------------
Strong Heritage Money Fund -
Institutional Class 1,000,000 -- (1,000,000) -- $ -- $ 5,291
Strong Large Cap Growth Fund
----------------------------
Strong Heritage Money Fund -
Institutional Class 6,200,000 -- (6,200,000) -- -- 1,113
Strong Growth Fund
------------------
Strong Heritage Money Fund -
Institutional Class 12,700,000 -- (12,700,000) -- -- 50,219
52
- --------------------------------------------------------------------------------
6. Capital Share Transactions
Strong Blue Chip Fund Strong Discovery Fund
--------------------------------- --------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002 June 30, 2003 Dec. 31, 2002
---------------- ------------- ---------------- --------------
(Unaudited) (Unaudited)
Capital Share Transactions of Each of the
Funds Were as Follows:
Proceeds from Shares Sold $ 26,829,996 $ 58,579,917 $ 35,410,764 $ 106,826,156
Proceeds from Reinvestment of Distributions -- -- -- 4,008,647
Payment for Shares Redeemed (64,057,213) (101,599,557) (38,395,150) (112,742,042)
---------------- ------------- ---------------- --------------
Net Increase (Decrease) in Net Assets
from Capital Share Transactions $ (37,227,217) $ (43,019,640) $ (2,984,386) $ (1,907,239)
================ ============= ================ ==============
Transactions in Shares of Each of the
Funds Were as Follows:
Sold 3,084,425 5,467,305 2,407,960 6,929,360
Issued in Reinvestment of Distributions -- -- -- 235,942
Redeemed (7,260,945) (9,308,147) (2,624,870) (7,318,812)
---------------- ------------- ---------------- --------------
Net Increase (Decrease) in Shares (4,176,520) (3,840,842) (216,910) (153,510)
================ ============= ================ ==============
Strong Endeavor Fund Strong Large Cap Growth Fund
--------------------------------- ---------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002 June 30, 2003 Dec. 31, 2002
---------------- ------------- ---------------- --------------
(Unaudited) (Unaudited)
Capital Share Transactions of Each of the
Funds Were as Follows:
Proceeds from Shares Sold $ 2,010,130 $ 2,639,463 $ 96,054,603 $ 92,753,828
Proceeds from Reinvestment of Distributions -- -- -- --
Payment for Shares Redeemed (1,241,361) (3,433,944) (114,397,959) (206,294,132)
---------------- ------------- ---------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions $ 768,769 $ (794,481) $ (18,343,356) $ (113,540,304)
================ ============= ================ ==============
Transactions in Shares of Each of the
Funds Were as Follows:
Sold 267,253 297,527 5,567,833 5,153,796
Issued in Reinvestment of Distributions -- -- -- --
Redeemed (166,530) (400,627) (6,639,645) (10,941,355)
---------------- ------------- ---------------- --------------
Net Increase (Decrease) in Shares 100,723 (103,100) (1,071,812) (5,787,559)
================ ============= ================ ==============
53
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
Strong Large Company
Growth Fund
----------------------------------------------------
Six Months Ended Period Ended Year Ended
June 30, 2003 Dec. 31, 2002 Sept. 30, 2002
---------------- -------------- ---------------
(Unaudited)
Capital Share Transactions of
the Fund Were as Follows:
Proceeds from Shares Sold $ 14,720,357 $ 4,988,912 $ 5,920,297
Proceeds from Reinvestment
of Distributions 12,085 66,475 607,929
Proceeds from Redemption fees 3,621 -- --
Payment for Shares Redeemed (5,408,932) (2,734,805) (17,465,133)
---------------- -------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions $ 9,327,131 $ 2,320,582 $ (10,936,907)
================ ============== ==============
Transactions in Shares of Each of the
Fund Were as Follows:
Sold 1,287,021 470,973 467,109
Issued in Reinvestment of Distributions 1,118 6,242 49,733
Redeemed (491,282) (248,984) (1,466,404)
---------------- -------------- --------------
Net Increase (Decrease) in Shares 796,857 228,231 (949,562)
================ ============= ==============
Strong U.S. Emerging Growth Fund
-------------------------------
Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002
---------------- -------------
(Unaudited)
Capital Share Transactions of the Fund
Were as Follows:
Proceeds from Shares Sold $ 30,834,181 $ 120,177,180
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (26,836,376) (116,020,955)
---------------- -------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions $ 3,997,805 $ 4,156,225
================ =============
Transactions in Shares of the Fund
Were as Follows:
Sold 3,007,722 9,702,326
Issued in Reinvestment of Distributions -- --
Redeemed (2,649,670) (9,562,612)
---------------- -------------
Net Increase (Decrease) in Shares of the Fund 358,052 139,714
================ =============
54
- --------------------------------------------------------------------------------
Strong Enterprise Fund
--------------------------------
Six Months Ended Year Ended
June 30, 2003 Dec. 31, 2002
---------------- -------------
(Unaudited)
Capital Share Transactions of Each Class of
Shares of the Fund Were as Follows:
INVESTOR CLASS
Proceeds from Shares Sold $ 27,840,482 $ 101,776,889
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (44,623,157) (148,882,956)
---------------- -------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions (16,782,675) (47,106,067)
ADVISOR CLASS
Proceeds from Shares Sold 329,630 849,133
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (138,483) (481,554)
---------------- -------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 191,147 367,579
CLASS K
Proceeds from Shares Sold 11,249,188 4,310,980
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (949,329) (371,572)
---------------- -------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 10,299,859 3,939,408
---------------- -------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions $ (6,291,669) $ (42,799,080)
================ =============
Transactions in Shares of Each Class of
the Fund Were as Follows:
INVESTOR CLASS
Sold 1,685,336 5,339,599
Issued in Reinvestment of Distributions -- --
Redeemed (2,735,391) (8,049,574)
---------------- -------------
Net Increase (Decrease) in Shares (1,050,055) (2,709,975)
================ =============
ADVISOR CLASS
Sold 19,140 44,794
Issued in Reinvestment of Distributions -- --
Redeemed (8,377) (26,641)
---------------- -------------
Net Increase (Decrease) in Shares 10,763 18,153
================ =============
CLASS K
Sold 703,001 270,110
Issued in Reinvestment of Distributions -- --
Redeemed (56,290) (23,597)
---------------- -------------
Net Increase (Decrease) in Shares 646,711 246,513
================ =============
55
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
Strong Growth 20 Fund
-------------------------------
Six Months
Ended Year Ended
June 30, 2003 Dec. 31, 2002
------------- --------------
(Unaudited)
Capital Share Transactions of Each Class of
Shares of the Fund Were as Follows:
INVESTOR CLASS
Proceeds from Shares Sold $ 194,290,209 $ 37,975,224
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (133,290,310) (119,329,093)
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 60,999,899 (81,353,869)
ADVISOR CLASS
Proceeds from Shares Sold 591,759 2,702,059
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (1,074,680) (3,312,180)
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions (482,921) (610,121)
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions $ 60,516,978 $ (81,963,990)
============= ==============
Transactions in Shares of Each Class of
the Fund Were as Follows:
INVESTOR CLASS
Sold 18,592,500 3,076,476
Issued in Reinvestment of Distributions -- --
Redeemed (12,775,830) (9,577,471)
------------- --------------
Net Increase (Decrease) in Shares 5,816,670 (6,500,995)
============= ==============
ADVISOR CLASS
Sold 55,446 218,805
Issued in Reinvestment of Distributions -- --
Redeemed (102,407) (279,312)
------------- --------------
Net Increase (Decrease) in Shares (46,961) (60,507)
============= ==============
56
- -------------------------------------------------------------------------------
Strong Growth Fund
-------------------------------
Six Months
Ended Year Ended
June 30, 2003 Dec. 31, 2002
------------- --------------
(Unaudited)
Capital Share Transactions of Each Class of
Shares of the Fund Were as Follows:
INVESTOR CLASS
Proceeds from Shares Sold $ 118,486,992 $ 212,362,800
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (153,804,796) (501,568,269)
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions (35,317,804) (289,205,469)
INSTITUTIONAL CLASS
Proceeds from Shares Sold 45,894,311 176,034,058
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (9,043,731) (15,602,302)
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 36,850,580 160,431,756
ADVISOR CLASS
Proceeds from Shares Sold 1,892,076 4,515,364
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (1,796,068) (5,576,741)
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 96,008 (1,061,377)
CLASS C
Proceeds from Shares Sold 159,871 100,000
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed -- --
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 159,871 100,000
CLASS K
Proceeds from Shares Sold 27,724,393 15,492,888
Proceeds from Reinvestment of Distributions -- --
Payment for Shares Redeemed (2,274,008) (1,625,166)
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions 25,450,385 13,867,722
------------- --------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions $ 27,239,040 $ (115,867,368)
============= ==============
57
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
Strong Growth Fund
-------------------------------
Six Months
Ended Year Ended
June 30, 2003 Dec. 31, 2002
------------- --------------
(Unaudited)
Transactions in Shares of Each Class of
the Fund Were as Follows:
INVESTOR CLASS
Sold 8,629,281 13,789,094
Issued in Reinvestment of Distributions -- --
Redeemed (11,261,094) (33,083,023)
------------- --------------
Net Increase (Decrease) in Shares (2,631,813) (19,293,929)
============= ==============
INSTITUTIONAL CLASS
Sold 3,276,156 11,454,780
Issued in Reinvestment of Distributions -- --
Redeemed (623,870) (1,053,015)
------------- --------------
Net Increase (Decrease) in Shares 2,652,286 10,401,765
============= ==============
ADVISOR CLASS
Sold 139,392 292,723
Issued in Reinvestment of Distributions -- --
Redeemed (134,062) (362,829)
------------- --------------
Net Increase (Decrease) in Shares 5,330 (70,106)
============= ==============
CLASS C
Sold 11,308 7,441
Issued in Reinvestment of Distributions -- --
Redeemed -- --
------------- --------------
Net Increase (Decrease) in Shares 11,308 7,441
============= ==============
CLASS K
Sold 1,995,174 1,111,771
Issued in Reinvestment of Distributions -- --
Redeemed (165,277) (125,340)
------------- --------------
Net Increase (Decrease) in Shares 1,829,897 986,431
============= ==============
58
- --------------------------------------------------------------------------------
7. Line of Credit
The Strong Funds have established a line of credit agreement ("LOC") with
certain financial institutions, which expires October 10, 2003, to be used
for temporary or emergency purposes, primarily for financing redemption
payments. Combined borrowings among all participating Strong Funds are
subject to a $350 million cap on the total LOC. For an individual Fund,
borrowings under the LOC are limited to either the lesser of 15% of the
market value of the Fund's total assets or any explicit borrowing limits in
the Funds' prospectus. Principal and interest on each borrowing under the
LOC are due not more than 45 days after the date of the borrowing.
Borrowings under the LOC bear interest based on prevailing market rates as
defined in the LOC. A commitment fee of 0.09% per annum is incurred on the
unused portion of the LOC and is allocated to all participating Strong
Funds. There were minimal borrowings under the LOC. At June 30, 2003, there
were no outstanding borrowings by the Funds under the LOC.
8. Investment Transactions
The aggregate purchases and sales of long-term securities during the six
months ended June 30, 2003, were as follows:
Purchases Sales
--------------- ---------------
Strong Blue Chip Fund $ 299,051,111 $ 325,357,201
Strong Discovery Fund 221,759,467 211,703,740
Strong Endeavor Fund 5,567,151 4,818,290
Strong Large Cap Growth Fund 733,465,887 717,490,891
Strong Large Company Growth Fund 32,122,599 22,782,262
Strong U.S. Emerging Growth Fund 40,220,778 37,883,674
Strong Enterprise Fund 293,911,598 297,973,014
Strong Growth 20 Fund 518,072,585 445,510,692
Strong Growth Fund 1,304,256,009 1,229,159,567
There were no purchases or sales of long-term U.S. government securities
during the six months ended June 30, 2003.
9. Income Tax Information
The following information for the Funds is presented on an income tax basis
as of June 30, 2003:
Net Unrealized
Gross Gross Appreciation/
Cost of Unrealized Unrealized (Depreciation)
Investments Appreciation (Depreciation) on Investments
-------------- -------------- -------------- --------------
Strong Blue Chip Fund $ 167,696,338 $ 17,501,213 $ (601,981) $ 16,899,232
Strong Discovery Fund 161,983,634 10,895,616 (2,265,341) 8,630,275
Strong Endeavor Fund 4,630,521 422,519 (51,321) 371,198
Strong Large Cap Growth Fund 635,682,566 55,672,407 (2,471,594) 53,200,813
Strong Large Company Growth Fund 33,352,929 2,050,672 (212,174) 1,838,498
Strong U.S. Emerging Growth Fund 55,415,091 19,182,610 (281,978) 18,900,632
Strong Enterprise Fund 262,369,080 31,329,049 (4,316,984) 27,012,065
Strong Growth 20 Fund 255,147,318 30,082,963 (852,476) 29,230,487
Strong Growth Fund 1,503,093,098 300,344,254 (6,492,245) 293,852,009
59
NOTES TO FINANCIAL STATEMENTS (continued)
- --------------------------------------------------------------------------------
June 30, 2003 (Unaudited)
The difference between cost amounts for financial statement and federal
income tax purposes is due primarily to timing differences in recognizing
certain gains and losses on security transactions.
The capital loss carryovers (expiring in varying amounts through 2010) as
of December 31, 2002, and tax basis post-October losses as of December 31,
2002, which are not recognized for tax purposes until the first day of the
following fiscal year are:
Net Capital
Loss Post-October
Carryovers Losses
--------------- ------------
Strong Blue Chip Fund $ 148,316,882 $ 19,188,881
Strong Discovery Fund 10,213,054 2,813,003
Strong Endeavor Fund 2,282,631 --
Strong Large Cap Growth Fund 529,198,023 3,123,094
Strong Large Company Growth Fund 9,760,514 238,951
Strong U.S. Emerging Growth Fund 66,963,119 1,378,784
Strong Enterprise Fund 359,801,272 6,101,892
Strong Growth 20 Fund 400,383,836 5,491,494
Strong Growth Fund 1,024,645,734 10,651,183
10. Special Meeting of Shareholders of Strong Advisor Mid Cap Growth Fund
On August 1, 2003, the Strong Advisor Mid Cap Growth Fund's and Strong
Growth Fund's Board of Directors approved the reorganization of the Strong
Advisor Mid Cap Growth Fund into the Strong Growth Fund, subject to
shareholder approval at a meeting scheduled for October 31, 2003. Effective
after the close of the market on August 22, 2003 the Strong Advisor Mid Cap
Growth Fund is closed to new investors.
60
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
STRONG BLUE CHIP FUND
- --------------------------------------------------------------------------------
Period Ended
------------------------------------------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000/(d)/ 2000 1999 1998
- ----------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 8.62 $ 12.36 $ 16.56 $ 20.99 $ 18.10 $ 13.24 $ 10.39
Income From Investment Operations:
Net Investment Income (Loss) (0.03) (0.08) (0.06) (0.01) (0.09) (0.04) 0.10
Net Realized and Unrealized Gains
(Losses) on Investments 0.88 (3.66) (4.14) (3.42) 2.98 4.90 2.86
- ------------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 0.85 (3.74) (4.20) (3.43) 2.89 4.86 2.96
Less Distributions:
From Net Investment Income -- -- -- -- -- (0.00)/(c)/ (0.11)
From Net Realized Gains -- -- -- (1.00) -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions -- -- -- (1.00) -- (0.00)/(c)/ (0.11)
- ------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 9.47 $ 8.62 $ 12.36 $ 16.56 $ 20.99 $ 18.10 $ 13.24
====================================================================================================================================
Ratios and Supplemental Data
- ------------------------------------------------------------------------------------------------------------------------------------
Total Return +9.9% -30.3% -25.4% -16.4% +16.0% +36.7% +28.6%
Net Assets, End of Period (In Millions) $ 184 $ 203 $ 339 $ 499 $ 616 $ 485 $ 90
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.8%* 1.6% 1.4% 1.1%* 1.1% 1.2% 1.3%
Ratio of Expenses to Average Net Assets 1.8%* 1.6% 1.4% 1.1%* 1.1% 1.2% 0.6%
Ratio of Net Investment Income (Loss)
to Average Net Assets (0.7%)* (0.7%) (0.4%) (0.2%)* (0.5%) (0.3%) 0.7%
Portfolio Turnover Rate 180.2% 214.0% 203.9% 21.2% 67.9% 75.4% 46.5%
STRONG DISCOVERY FUND
- --------------------------------------------------------------------------------
Period Ended
---------------------------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000 1999 1998
- -------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 14.42 $ 16.84 $ 16.39 $ 18.64 $ 17.95 $ 17.00
Income From Investment Operations:
Net Investment Income (Loss) (0.03) (0.06) (0.08) 0.06 (0.17) (0.07)
Net Realized and Unrealized Gains
(Losses) on Investments 1.85 (1.91) 0.76 0.51 1.08 1.26
- -------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 1.82 (1.97) 0.68 0.57 0.91 1.19
Less Distributions:
From Net Investment Income -- -- -- (0.04) -- --
From Net Realized Gains -- (0.45) (0.23) (2.78) (0.22) (0.24)
- -------------------------------------------------------------------------------------------------------------------
Total Distributions -- (0.45) (0.23) (2.82) (0.22) (0.24)
- -------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 16.24 $ 14.42 $ 16.84 $ 16.39 $ 18.64 $ 17.95
===================================================================================================================
Ratios and Supplemental Data
- -------------------------------------------------------------------------------------------------------------------
Total Return +12.6% -12.1% +4.2% +4.0% +5.3% +7.0%
Net Assets, End of Period (In Millions) $ 147 $ 133 $ 158 $ 165 $ 187 $ 322
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.5%* 1.5% 1.5% 1.5% 1.4% 1.3%
Ratio of Expenses to Average Net Assets 1.5%* 1.5% 1.5% 1.5% 1.4% 1.3%
Ratio of Net Investment Income (Loss) to
Average Net Assets (0.5%)* (0.4%) (0.5%) 0.3% (0.7%) (0.4%)
Portfolio Turnover Rate 169.2% 420.0% 501.7% 481.8% 214.0% 185.9%
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 2003 (unaudited).
(c) Amount calculated is less than $0.005.
(d) In 2000, the Fund changed its fiscal year-end from October to December.
See Notes to Financial Statements.
61
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------
STRONG ENDEAVOR FUND
- --------------------------------------------------------------------------------
Period Ended
----------------------------------------
June 30, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001/(e)/
- -------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 7.03 $ 9.94 $ 10.00
Income From Investment Operations:
Net Investment Income (Loss) (0.03) (0.11) (0.06)/(c)/
Net Realized and Unrealized Gains (Losses) on
Investments 1.00 (2.80) 0.00/(d)/
- -------------------------------------------------------------------------------------------
Total from Investment Operations 0.97 (2.91) (0.06)
Less Distributions:
From Net Investment Income -- -- --
- -------------------------------------------------------------------------------------------
Total Distributions -- -- --
- -------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 8.00 $ 7.03 $ 9.94
===========================================================================================
Ratios and Supplemental Data
- -------------------------------------------------------------------------------------------
Total Return +13.8% -29.3% -0.6%
Net Assets, End of Period (In Millions) $ 5 $ 4 $ 6
Ratio of Expenses to Average Net Assets before
Expense Offsets 3.0%* 2.7% 3.1%*
Ratio of Expenses to Average Net Assets 1.9%* 1.9% 2.2%*
Ratio of Net Investment Income (Loss) to
Average Net Assets (1.0%)* (1.2%) (1.2%)*
Portfolio Turnover Rate 117.1% 416.8% 391.8%
STRONG LARGE CAP GROWTH FUND
- --------------------------------------------------------------------------------
Period Ended
------------------------------------------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31, Oct. 31, Oct. 31, Oct. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000/(f)/ 2000 1999 1998
- -------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 16.51 $ 23.55 $ 34.77 $ 45.49 $ 41.52 $ 29.10 $ 32.66
Income From Investment Operations:
Net Investment Income (Loss) (0.04) (0.08) (0.02) 0.01 (0.16) (0.03) 0.13
Net Realized and Unrealized Gains
(Losses) on Investments 2.29 (6.96) (11.20) (4.81) 12.01 12.84 3.44
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 2.25 (7.04) (11.22) (4.80) 11.85 12.81 3.57
Less Distributions:
From Net Investment Income -- -- (0.00)/(d)/ -- -- -- (0.14)
In Excess of Net Investment Income -- -- -- -- -- (0.01) --
From Net Realized Gains -- -- -- (5.92) (7.88) (0.38) (6.89)
In Excess of Net Realized Gains -- -- -- -- -- -- (0.10)
- -------------------------------------------------------------------------------------------------------------------------------
Total Distributions -- -- (0.00)/(d)/ (5.92) (7.88) (0.39) (7.13)
- -------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 18.76 $ 16.51 $ 23.55 $ 34.77 $ 45.49 $ 41.52 $ 29.10
===============================================================================================================================
Ratios and Supplemental Data
- -------------------------------------------------------------------------------------------------------------------------------
Total Return +13.6% -29.9% -32.3% -10.3% +28.1% +44.3% +13.6%
Net Assets, End of Period (In Millions) $ 649 $ 589 $ 976 $ 1,574 $ 1,769 $ 1,253 $ 863
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.3%* 1.2% 1.1% 1.0%* 1.0% 1.0% 1.0%
Ratio of Expenses to Average Net Assets 1.3%* 1.2% 1.1% 1.0%* 1.0% 1.0% 1.0%
Ratio of Net Investment Income (Loss)
to Average Net Assets (0.4%)* (0.4%) (0.1%) 0.1%* (0.4%) (0.1%) 0.4%
Portfolio Turnover Rate 123.6% 443.2% 468.7% 68.6% 455.0% 402.3% 267.8%
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 2003 (unaudited).
(c) Net investment loss per share represents net investment loss divided by
the average shares outstanding throughout the period.
(d) Amount calculated is less than $0.005.
(e) For the period from April 9, 2001 (public launch date) to December 31,
2001.
(f) In 2000, the Fund changed its fiscal year-end from October to December.
See Notes to Financial Statements.
62
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------
STRONG LARGE COMPANY GROWTH FUND
- --------------------------------------------------------------------------------
Period Ended
-------------------------------------------------------------------------------------
June 30, Dec. 31, Sep. 30, Sep. 30, Sep. 30, Sep. 30, Sep. 30,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002/(f)/ 2002/(d)/ 2001 2000 1999 1998/(e)/
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 10.66 $ 10.25 $ 12.17 $ 19.15 $ 13.12 $ 9.80 $ 10.00
Income From Investment Operations:
Net Investment Income (0.01) (0.00)/(c)/ 0.31 0.32 0.29 0.18 0.21
Net Realized and Unrealized Gains
(Losses) on Investments 1.32 0.45 (1.93) (5.09) 6.26 3.33 (0.21)
- --------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 1.31 0.45 (1.62) (4.77) 6.55 3.51 --
Less Distributions:
From Net Investment Income (0.01) (0.04) (0.27) (0.32) (0.27) (0.19) (0.20)
From Net Realized Gains -- -- (0.03) (1.89) (0.25) -- --
- --------------------------------------------------------------------------------------------------------------------------------
Total Distributions (0.01) (0.04) (0.30) (2.21) (0.52) (0.19) (0.20)
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 11.96 $ 10.66 $ 10.25 $ 12.17 $ 19.15 $ 13.12 $ 9.80
================================================================================================================================
Ratios and Supplemental Data
- --------------------------------------------------------------------------------------------------------------------------------
Total Return/(e)/ +12.3% +4.4% -13.7% -26.2% +50.7% +36.0% -0.1%
Net Assets, End of Period (In Millions) $ 34 $ 21 $ 18 $ 33 $ 37 $ 9 $ 2
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.8%* 1.9%* 1.7% 1.6% 1.6% 3.1% 11.3%*
Ratio of Expenses to Average Net Assets 1.5%* 1.3%* 1.5% 1.5% 1.5% 1.5% 1.5%*
Ratio of Net Investment Income (Loss)
to Average Net Assets (0.3%)* 0.2%* 2.3% 2.2% 1.8% 1.5% 2.6%*
Portfolio Turnover Rate 93.7% 71.8% 311.3% 285.3% 180.8% 120.2% 147.6%
STRONG U.S. EMERGING GROWTH FUND
- --------------------------------------------------------------------------------
Period Ended
----------------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000 1999
- -----------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 10.02 $ 15.17 $ 19.17 $ 19.59 $ 10.00
Income From Investment Operations:
Net Investment Income (Loss) (0.09) (0.24) (0.23) (0.19) (0.11)
Net Realized and Unrealized Gains
(Losses) on Investments 2.05 (4.91) (3.77) 0.22 9.99
- -----------------------------------------------------------------------------------------------------
Total from Investment Operations 1.96 (5.15) (4.00) 0.03 9.88
Less Distributions:
From Net Realized Gains -- -- -- (0.45) (0.29)
- -----------------------------------------------------------------------------------------------------
Total Distributions -- -- -- (0.45) (0.29)
- -----------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 11.98 $ 10.02 $ 15.17 $ 19.17 $ 19.59
=====================================================================================================
Ratios and Supplemental Data
- -----------------------------------------------------------------------------------------------------
Total Return +19.6% -34.0% -20.9% +0.3% +98.9%
Net Assets, End of Period (In Millions) $ 74 $ 58 $ 86 $ 112 $ 36
Ratio of Expenses to Average Net Assets
before Expense Offsets 2.1%* 1.9% 1.6% 1.4% 1.9%
Ratio of Expenses to Average Net Assets 1.9%* 1.9% 1.6% 1.4% 1.8%
Ratio of Net Investment Income (Loss)
to Average Net Assets (1.9%)* (1.8%) (1.5%) (1.2%) (1.5%)
Portfolio Turnover Rate 61.9% 171.5% 168.2% 186.8% 281.1%
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 2003 (unaudited).
(c) Amount calculated is less than $0.005.
(d) Effective September 5, 2002, Strong Capital Management, Inc. assumed the
investment advisory responsibilities from Rockhaven Asset Management, LLC.
(e) For the period from November 4, 1997 (public launch date) through
September 30, 1998.
(f) In 2002, the Fund changed its fiscal year-end from September to December.
See Notes to Financial Statements.
63
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------
STRONG ENTERPRISE FUND--INVESTOR CLASS
- --------------------------------------------------------------------------------
Period Ended
------------------------------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000 1999 1998/(h)/
- -------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 15.90 $ 22.14 $ 28.37 $ 41.24 $ 14.74 $ 10.00
Income From Investment Operations:
Net Investment Income (Loss) (0.12) (0.28)/(c)/ (0.31) (0.28) (0.09) (0.01)
Net Realized and Unrealized Gains
(Losses) on Investments 2.56 (5.96) (5.92) (12.04) 27.43 4.75
- -------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 2.44 (6.24) (6.23) (12.32) 27.34 4.74
Less Distributions:
From Net Realized Gains -- -- -- (0.55) (0.84) (0.00)/(d)/
- -------------------------------------------------------------------------------------------------------------------
Total Distributions -- -- -- (0.55) (0.84) (0.00)/(d)/
- -------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 18.34 $ 15.90 $ 22.14 $ 28.37 $ 41.24 $ 14.74
===================================================================================================================
Ratios and Supplemental Data
- -------------------------------------------------------------------------------------------------------------------
Total Return +15.4% -28.2% -22.0% -29.8% +187.8% +47.4%
Net Assets, End of Period (In Millions) $ 239 $ 224 $ 372 $ 575 $ 571 $ 11
Ratio of Expenses to Average Net Assets
before Expense Offsets 2.2%* 2.0% 1.8% 1.4% 1.4% 2.0%
Ratio of Expenses to Average Net Assets 2.0%* 2.0% 1.8% 1.4% 1.4% 2.0%
Ratio of Net Investment Income (Loss)
to Average Net Assets (1.5%)* (1.5%) (1.2%) (0.7%) (1.0%) (0.9%)
Portfolio Turnover Rate/(e)/ 129.4% 376.8% 629.8% 473.7% 178.1% 95.7%
STRONG ENTERPRISE FUND--ADVISOR CLASS
- --------------------------------------------------------------------------------
Period Ended
------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000/(f)/
- -------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 15.86 $ 22.04 $ 28.31 $ 51.32
Income From Investment Operations:
Net Investment Income (Loss) (0.08) (0.24)/(c)/ (0.21) (0.03)
Net Realized and Unrealized Gains
(Losses) on Investments 2.54 (5.94) (6.06) (22.43)
- -------------------------------------------------------------------------------------------
Total from Investment Operations 2.46 (6.18) (6.27) (22.46)
Less Distributions:
From Net Realized Gains -- -- -- (0.55)
- -------------------------------------------------------------------------------------------
Total Distributions -- -- -- (0.55)
- -------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 18.32 $ 15.86 $ 22.04 $ 28.31
===========================================================================================
Ratios and Supplemental Data
- -------------------------------------------------------------------------------------------
Total Return +15.5% -28.0% -22.2% -43.7%
Net Assets, End of Period (In Millions) $ 2 $ 1 $ 1 $ 0/(g)/
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.6%* 1.8% 2.1% 2.0%*
Ratio of Expenses to Average Net Assets 1.6%* 1.8% 2.1% 1.9%*
Ratio of Net Investment Income (Loss)
to Average Net Assets (1.1%)* (1.3%) (1.6%) (1.2%)*
Portfolio Turnover Rate/(e)/ 129.4% 376.8% 629.8% 473.7%
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 2003 (unaudited).
(c) Net investment income (loss) per share represents net investment income
(loss) divided by the average shares outstanding throughout the period.
(d) Amount calculated is less than $0.005.
(e) Calculated on the basis of the Fund as a whole without distinguishing
between classes of shares issued.
(f) For the period from February 28, 2000 (public launch date) to
December 31, 2000.
(g) Amount is less than $500,000.
(h) For the period from October 1, 1998 (public launch date) to December 31,
1998.
See Notes to Financial Statements.
64
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------
STRONG ENTERPRISE FUND--CLASS K
- --------------------------------------------------------------------------------
Period Ended
----------------------
June 30, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002/(f)/
- -----------------------------------------------------------------
Net Asset Value, Beginning of Period $ 15.94 $ 16.32
Income From Investment Operations:
Net Investment Income (Loss) (0.05) (0.04)/(c)/
Net Realized and Unrealized Gains
(Losses) on Investments 2.56 (0.34)
- -----------------------------------------------------------------
Total from Investment Operations 2.51 (0.38)
Less Distributions:
From Net Investment Income -- --
- -----------------------------------------------------------------
Total Distributions -- --
- -----------------------------------------------------------------
Net Asset Value, End of Period $ 18.45 $ 15.94
=================================================================
Ratios and Supplemental Data
- -----------------------------------------------------------------
Total Return +15.8% -2.3%
Net Assets, End of Period (In Millions) $ 16 $ 4
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.3%* 1.3%*
Ratio of Expenses to Average Net Assets 1.2%* 1.1%*
Ratio of Net Investment Income (Loss)
to Average Net Assets (0.7%)* (0.6%)*
Portfolio Turnover Rate/(d)/ 129.4% 376.8%
STRONG GROWTH 20 FUND--INVESTOR CLASS
- ----------------------------------------------------------------------
Period Ended
---------------------------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000 1999 1998
- ----------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 10.19 $ 14.74 $ 25.13 $ 30.63 $ 15.44 $ 11.31
Income From Investment Operations:
Net Investment Income (Loss) (0.08) (0.21) (0.15) (0.10) (0.08) (0.08)
Net Realized and Unrealized Gains
(Losses) on Investments 1.22 (4.34) (10.24) (3.05) 16.60 4.21
- ----------------------------------------------------------------------------------------------------------------
Total from Investment Operations 1.14 (4.55) (10.39) (3.15) 16.52 4.13
Less Distributions:
From Net Investment Income -- -- -- -- -- 0.00/(e)/
From Net Realized Gains -- -- -- (2.35) (1.33) --
- ----------------------------------------------------------------------------------------------------------------
Total Distributions -- -- -- (2.35) (1.33) 0.00/(e)/
- ----------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 11.33 $ 10.19 $ 14.74 $ 25.13 $ 30.63 $ 15.44
================================================================================================================
Ratios and Supplemental Data
- ----------------------------------------------------------------------------------------------------------------
Total Return +11.2% -30.9% -41.4% -10.3% +109.5% +36.5%
Net Assets, End of Period (In Millions) $ 270 $ 184 $ 361 $ 766 $ 466 $ 71
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.9%* 1.9% 1.5% 1.3% 1.4% 1.5%
Ratio of Expenses to Average Net Assets 1.8%* 1.9% 1.5% 1.3% 1.4% 1.5%
Ratio of Net Investment Income (Loss)
to Average Net Assets (1.6%)* (1.5%) (0.8%) (0.4%) (0.6%) (0.6%)
Portfolio Turnover Rate/(d)/ 189.6% 460.8% 658.7% 521.0% 432.3% 541.2%
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 2003 (unaudited).
(c) Net investment income (loss) per share represents net investment income
(loss) divided by the average shares outstanding throughout the period.
(d) Calculated on the basis of the Fund as a whole without distinguishing
between classes of shares issued.
(e) Amount calculated is less than $0.005.
(f) For the period from September 3, 2002 (public launch date) to
December 31, 2002.
See Notes to Financial Statements.
65
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------
STRONG GROWTH 20 FUND--ADVISOR CLASS
- --------------------------------------------------------------------------------
Period Ended
----------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000/(f)/
- -----------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 10.19 $ 14.69 $ 25.06 $ 36.61
Income From Investment Operations:
Net Investment Income (Loss) (0.07) (0.15) (0.12) (0.02)
Net Realized and Unrealized Gains
(Losses) on Investments 1.22 (4.35) (10.25) (9.18)
- -----------------------------------------------------------------------------------------
Total from Investment Operations 1.15 (4.50) (10.37) (9.20)
Less Distributions:
From Net Realized Gains -- -- -- (2.35)
- -----------------------------------------------------------------------------------------
Total Distributions -- -- -- (2.35)
- -----------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 11.34 $ 10.19 $ 14.69 $ 25.06
=========================================================================================
Ratios and Supplemental Data
- -----------------------------------------------------------------------------------------
Total Return +11.3% -30.6% -41.4% -25.2%
Net Assets, End of Period (In Millions) $ 7 $ 7 $ 10 $ 5
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.6%* 1.6% 1.6% 2.0%*
Ratio of Expenses to Average Net Assets 1.6%* 1.6% 1.6% 1.9%*
Ratio of Net Investment Income (Loss)
to Average Net Assets (1.3%)* (1.2%) (0.9%) (1.0%)*
Portfolio Turnover Rate/(c)/ 189.6% 460.8% 658.7% 521.0%
STRONG GROWTH FUND--INVESTOR CLASS
- --------------------------------------------------------------------------------
Period Ended
----------------------------------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 13.21 $ 17.68 $ 27.05 $ 35.66 $ 23.25 $ 18.31
Income From Investment Operations:
Net Investment Income (Loss) (0.08)/(d)/ (0.18)/(d)/ (0.15) (0.17) (0.18) (0.13)
Net Realized and Unrealized Gains
(Losses) on Investments 2.00 (4.29) (9.15) (3.21) 17.08 5.07
- -----------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 1.92 (4.47) (9.30) (3.38) 16.90 4.94
Less Distributions:
From Net Realized Gains -- -- (0.07) (5.23) (4.49) (0.00)/(e)/
- -----------------------------------------------------------------------------------------------------------------------
Total Distributions -- -- (0.07) (5.23) (4.49) (0.00)/(e)/
- -----------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 15.13 $ 13.21 $ 17.68 $ 27.05 $ 35.66 $ 23.25
=======================================================================================================================
Ratios and Supplemental Data
- -----------------------------------------------------------------------------------------------------------------------
Total Return +14.5% -25.3% -34.4% -9.2% +75.1% +27.0%
Net Assets, End of Period (In Millions) $ 1,399 $ 1,256 $ 2,022 $ 3,411 $ 3,354 $ 1,835
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.6%* 1.6% 1.4% 1.2% 1.2% 1.3%
Ratio of Expenses to Average Net Assets 1.6%* 1.6% 1.4% 1.2% 1.2% 1.3%
Ratio of Net Investment Income (Loss)
to Average Net Assets (1.1%)* (1.2%) (0.7%) (0.6%) (0.8%) (0.7%)
Portfolio Turnover Rate/(c)/ 80.8% 248.5% 399.8% 366.3% 324.0% 248.6%
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 2003 (unaudited).
(c) Calculated on the basis of the Fund as a whole without distinguishing
between the classes of shares issued.
(d) Net investment income (loss) per share represents net investment income
(loss) divided by average shares outstanding throughout the period.
(e) Amount calculated is less than $0.005.
(f) For the period from February 28, 2000 (public launch date) to
December 31, 2000.
See Notes to Financial Statements.
66
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------
STRONG GROWTH FUND--INSTITUTIONAL CLASS
- --------------------------------------------------------------------------------
Period Ended
-----------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000/(e)/
- ------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 13.48 $ 17.91 $ 27.17 $ 43.74
Income From Investment Operations:
Net Investment Income (Loss) (0.03)/(d)/ (0.08)/(d)/ (0.02) (0.01)
Net Realized and Unrealized Gains
(Losses) on Investments 2.04 (4.35) (9.17) (11.33)
- ------------------------------------------------------------------------------------------------
Total from Investment Operations 2.01 (4.43) (9.19) (11.34)
Less Distributions:
From Net Realized Gains -- -- (0.07) (5.23)
- ------------------------------------------------------------------------------------------------
Total Distributions -- -- (0.07) (5.23)
- ------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 15.49 $ 13.48 $ 17.91 $ 27.17
================================================================================================
Ratios and Supplemental Data
- ------------------------------------------------------------------------------------------------
Total Return +14.9% -24.7% -33.8% -25.7%
Net Assets, End of Period (In Millions) $ 265 $ 195 $ 73 $ 18
Ratio of Expenses to Average Net Assets
before Expense Offsets 0.9%* 0.9% 0.9% 0.8%*
Ratio of Expenses to Average Net Assets 0.9%* 0.9% 0.9% 0.8%*
Ratio of Net Investment Income (Loss)
to Average Net Assets (0.5%)* (0.5%) (0.3%) (0.1%)*
Portfolio Turnover Rate/(c)/ 80.8% 248.5% 399.8% 366.3%
STRONG GROWTH FUND--ADVISOR CLASS
- --------------------------------------------------------------------------------
Period Ended
-----------------------------------------------------
June 30, Dec. 31, Dec. 31, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002 2001 2000/(e)/
- ------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 13.14 $ 17.58 $ 26.96 $ 43.74
Income From Investment Operations:
Net Investment Income (Loss) (0.07)/(d)/ (0.17)/(d)/ (0.15) (0.02)
Net Realized and Unrealized Gains
(Losses) on Investments 1.98 (4.27) (9.16) (11.53)
- ------------------------------------------------------------------------------------------------
Total from Investment Operations 1.91 (4.44) (9.31) (11.55)
Less Distributions:
From Net Realized Gains -- -- (0.07) (5.23)
- ------------------------------------------------------------------------------------------------
Total Distributions -- -- (0.07) (5.23)
- ------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 15.05 $ 13.14 $ 17.58 $ 26.96
================================================================================================
Ratios and Supplemental Data
- ------------------------------------------------------------------------------------------------
Total Return +14.5% -25.3% -34.5% -26.2%
Net Assets, End of Period (In Millions) $ 11 $ 10 $ 14 $ 4
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.6%* 1.6% 1.6% 2.0%*
Ratio of Expenses to Average Net Assets 1.6%* 1.6% 1.6% 1.9%*
Ratio of Net Investment Income (Loss)
to Average Net Assets (1.1%)* (1.2%) (1.0%) (0.9%)*
Portfolio Turnover Rate/(c)/ 80.8% 248.5% 399.8% 366.3%
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 2003 (unaudited).
(c) Calculated on the basis of the Fund as a whole without distinguishing
between the classes of shares issued.
(d) Net investment income (loss) per share represents net investment income
(loss) divided by average shares outstanding throughout the period.
(e) For the period from February 28, 2000 (public launch date) to
December 31, 2000.
See Notes to Financial Statements.
67
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------
STRONG GROWTH FUND--CLASS C
- --------------------------------------------------------------------------------
Period Ended
-------------------------
June 30, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002/(d)/
- --------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 13.21 $ 13.44
Income From Investment Operations:
Net Investment Income (Loss) (0.14)/(f)/ 0.00/(e)//(f)/
Net Realized and Unrealized Gains
(Losses) on Investments 2.00 (0.23)
- --------------------------------------------------------------------
Total from Investment Operations 1.86 (0.23)
Less Distributions:
From Net Investment Income -- --
- --------------------------------------------------------------------
Total Distributions -- --
- --------------------------------------------------------------------
Net Asset Value, End of Period $ 15.07 $ 13.21
====================================================================
Ratios and Supplemental Data
- --------------------------------------------------------------------
Total Return +14.1% -1.7%
Net Assets, End of Period (In Millions) $ 0/(g)/ $ 0/(g)/
Ratio of Expenses to Average Net Assets
before Expense Offsets 2.5%* 2.3%*
Ratio of Expenses to Average Net Assets 2.5%* 2.3%*
Ratio of Net Investment Income (Loss)
to Average Net Assets (2.1%)* 0.0%*/(e)/
Portfolio Turnover Rate/(c)/ 80.8% 248.5%
STRONG GROWTH FUND--CLASS K
- --------------------------------------------------------------------------------
Period Ended
-------------------------
June 30, Dec. 31,
Selected Per-Share Data/(a)/ 2003/(b)/ 2002/(h)/
- --------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 13.29 $ 13.53
Income From Investment Operations:
Net Investment Income (Loss) (0.04)/(f)/ (0.01)/(f)/
Net Realized and Unrealized Gains
(Losses) on Investments 2.02 (0.23)
- --------------------------------------------------------------------
Total from Investment Operations 1.98 (0.24)
Less Distributions:
From Net Investment Income -- --
- --------------------------------------------------------------------
Total Distributions -- --
- --------------------------------------------------------------------
Net Asset Value, End of Period $ 15.27 $ 13.29
====================================================================
Ratios and Supplemental Data
- --------------------------------------------------------------------
Total Return +14.9% -1.8%
Net Assets, End of Period (In Millions) $ 43 $ 13
Ratio of Expenses to Average Net Assets
before Expense Offsets 1.2%* 1.3%*
Ratio of Expenses to Average Net Assets 1.0%* 1.0%*
Ratio of Net Investment Income (Loss)
to Average Net Assets (0.5%)* (0.7%)*
Portfolio Turnover Rate/(c)/ 80.8% 248.5%
* Calculated on an annualized basis.
(a) Information presented relates to a share of capital stock of the Fund
outstanding for the entire period.
(b) For the six months ended June 30, 2003 (unaudited).
(c) Calculated on the basis of the Fund as a whole without distinguishing
between the classes of shares issued.
(d) For the period from December 30, 2002 (public launch date) to
December 31, 2002.
(e) Amount calculated is less than $0.005 or 0.05%.
(f) Net investment income (loss) per share represents net investment income
(loss) divided by average shares outstanding throughout the period.
(g) Amount is less than $500,000.
(h) For the period from September 2, 2002 (public launch date) to
December 31, 2002.
See Notes to Financial Statements.
68
DIRECTORS AND OFFICERS
- --------------------------------------------------------------------------------
Richard S. Strong (indicated below by an asterisk*) is deemed an "interested
person" of the Fund as defined in the Investment Company Act of 1940 because of
his controlling ownership in the Advisor's parent company, Strong Financial
Corporation. Each officer and director holds the same position with the 27
registered open-end management investment companies consisting of 71 mutual
funds ("Strong Funds").
* Richard S. Strong (DOB 5-12-42), Director of the Strong Funds since
September 1981 and Chairman of the Board of the Strong Funds since October
1991.
Mr. Strong has been a Director of the Advisor since September 1981;
Chairman of the Advisor since October 1991; Chief Investment Officer of the
Advisor since January 1996; Security Analyst and Portfolio Manager of the
Advisor since 1985; Chief Executive Officer of the Advisor from 1974 to 1985;
Chairman of Strong Financial Corporation (holding company) since May 2001;
Director and Chairman of Strong Service Corporation (an investment advisor)
since 1995; and Director and Chairman of Strong Investor Services, Inc. (a
transfer agent and administrator), since July 2001. Mr. Strong founded the
Advisor in 1974 and has been in the investment management business since 1967.
Willie D. Davis (DOB 7-24-34), Director of the Strong Funds since July 1994.
Mr. Davis has been President and Chief Executive Officer of All Pro
Broadcasting, Inc., since 1977; Director of Wisconsin Energy Corporation
(formerly WICOR, Inc.) (a utility company), since 1990, Metro Goldwyn Mayer,
Inc. (an entertainment company), since 1998, Bassett Furniture Industries, Inc.,
since 1997, Checker's Drive-In Restaurants, Inc. (formerly Rally's Hamburgers,
Inc.), since 1994, Johnson Controls, Inc. (an industrial company), since 1992,
MGM Mirage (formerly MGM Grand, Inc.) (an entertainment/hotel company) since
1990, Dow Chemical Company since 1988, Sara Lee Corporation (a food/consumer
products company) since 1983, Alliance Bank since 1980, Manpower, Inc. (a
worldwide provider of staffing services), since 2001, and Kmart Corporation (a
discount consumer products company) from 1985 to 2003; and Trustee of the
University of Chicago since 1980 and Marquette University since 1988.
Gordon B. Greer (DOB 2-17-32), Director of the Strong Funds since March 2002.
Mr. Greer was Of Counsel for Bingham McCutchen LLP (a law firm previously
known as Bingham Dana LLP) from 1997 to February 2002 and Partner of Bingham
McCutchen LLP from 1967 to 1997. On behalf of Bingham McCutchen LLP, Mr. Greer
provided representation to the disinterested directors of the Strong Funds from
1991 to February 2002. Bingham McCutchen LLP has provided representation to the
Independent Directors of the Strong Funds since 1991.
Stanley Kritzik (DOB 1-9-30), Director of the Strong Funds since January 1995
and Chairman of the Audit Committee of the Strong Funds since July 2000.
Mr. Kritzik has been Partner of Metropolitan Associates (a real estate
firm) since 1962; Director of Wisconsin Health Information Network since
November 1997, Health Network Ventures, Inc., from 1992 to April 2000, Aurora
Health Care from September 1987 to September 2002; and Member of the Board of
Governors of Snowmass Village Resort Association from October 1999 until October
2002.
Neal Malicky (DOB 9-14-34), Director of the Strong Funds since December 1999.
Mr. Malicky has been President Emeritus of Baldwin-Wallace College since
July 2000; Chancellor of Baldwin-Wallace College from July 1999 to June 2000;
President of Baldwin-Wallace College from July 1981 to June 1999; Director of
Aspire Learning Corporation since June 2000; Trustee of Southwest Community
Health Systems, Cleveland Scholarship Program, and The National Conference for
Community and Justice until 2001; President of the National Association of
Schools and Colleges of the United Methodist Church, Chairperson of the
Association of Independent Colleges and Universities of Ohio, and Secretary of
the National Association of Independent Colleges and Universities until 2001.
William F. Vogt (DOB 7-19-47), Director and Chairman of the Independent
Directors Committee of the Strong Funds since January 1995.
Mr. Vogt has been Senior Vice President of IDX Systems Corporation (a
management consulting firm) since June 2001; President of Vogt Management
Consulting, Inc., from July 1990 to June 2001; and former Fellow of the American
College of Medical Practice Executives.
69
DIRECTORS AND OFFICERS (continued)
- --------------------------------------------------------------------------------
Ane K. Ohm (DOB 10-16-69), Anti-Money Laundering Compliance Officer since
November 2002.
Ms. Ohm has been Director of Mutual Fund Administration of Strong Investor
Services, Inc., since April 2001; Marketing Services Manager of Strong
Investments, Inc., from November 1998 to April 2001; and Retail Services
Financial Manager of Strong Investments, Inc., from January 1997 to November
1998.
Christopher O. Petersen (DOB 1-18-70), Vice President and Assistant Secretary of
the Strong Funds since May 2003.
Mr. Petersen has been Managing Counsel of Strong Financial Corporation
since March 2003; Corporate Counsel at U.S. Bancorp Asset Management, Inc., from
May 2001 to March 2003; Corporate Counsel at First American Asset Management, a
division of U.S. Bank National Association ("FAAM"), from September 1999 to May
2001; Compliance Officer at FAAM from January 1999 to September 1999; and
Associate at Mauzy Law Firm from September 1997 to December 1998.
Richard W. Smirl (DOB 4-18-67), Vice President of the Strong Funds since
February 2002 and Secretary of the Strong Funds since November 2001.
Mr. Smirl has been Senior Counsel of Strong Financial Corporation since
December 2001; Assistant Executive Vice President since December 2001; Secretary
of the Advisor since November 2002; Assistant Secretary of the Advisor from
December 2001 to November 2002; Senior Counsel of the Advisor from July 2000 to
December 2001; General Counsel of Strong Investments, Inc. ("Distributor"),
since November 2001; Vice President, Secretary, and Chief Compliance Officer of
the Distributor since July 2000; Lead Counsel of the Distributor from July 2000
to November 2001; Partner at Keesal, Young & Logan LLP (a law firm) from
September 1999 to July 2000; and Associate at Keesal, Young & Logan LLP from
September 1992 to September 1999.
Gilbert L. Southwell III (DOB 4-13-54), Assistant Secretary of the Strong Funds
since July 2001.
Mr. Southwell has been Associate Counsel of Strong Financial Corporation
since December 2001; Assistant Secretary of the Advisor since December 2002;
Associate Counsel of the Advisor from April 2001 to December 2001; Partner at
Michael, Best & Friedrich, LLP (a law firm) from October 1999 to March 2001; and
Assistant General Counsel of U.S. Bank, National Association (formerly Firstar
Bank, N.A.) and/or certain of its subsidiaries from November 1984 to September
1999.
John W. Widmer (DOB 1-19-65), Treasurer of the Strong Funds since April 1999.
Mr. Widmer has been Treasurer of the Advisor since April 1999; Assistant
Secretary and Assistant Treasurer of Strong Financial Corporation since December
2001; Treasurer of Strong Service Corporation since April 1999; Treasurer and
Assistant Secretary of Strong Investor Services, Inc., since July 2001; and
Manager of the Financial Management and Sales Reporting Systems department of
the Advisor from May 1997 to April 1999.
Thomas M. Zoeller (DOB 2-21-64), Vice President of the Strong Funds since
October 1999.
Mr. Zoeller has been Executive Vice President of the Advisor since April
2001; Chief Financial Officer of the Advisor since February 1998; Secretary of
the Advisor from December 2001 to November 2002; Member of the Office of the
Chief Executive of Strong Financial Corporation since May 2001; Chief Financial
Officer and Treasurer of Strong Investments, Inc., since October 1993; Executive
Vice President and Secretary of Strong Investor Services, Inc., since July 2001;
Executive Vice President, Chief Financial Officer, and Secretary of Strong
Service Corporation since December 2001; Treasurer of Strong Service Corporation
from September 1996 to April 1999; Vice President of Strong Service Corporation
from April 1999 to December 2001; Member of the Office of the Chief Executive of
the Advisor from November 1998 until May 2001; Senior Vice President of the
Advisor from February 1998 to April 2001; and Treasurer and Controller of the
Advisor from October 1991 to February 1998.
Except for Messrs. Davis, Kritzik, Malicky, and Vogt, the address of all of
the Directors and Officers is P.O. Box 2936, Milwaukee, WI 53201. Mr. Davis's
address is 161 North La Brea, Inglewood, CA 90301. Mr. Kritzik's address is 1123
North Astor Street, Milwaukee, WI 53202. Mr. Malicky's address is 4608 Turnberry
Drive, Lawrence, KS 66047. Mr. Vogt's address is P.O. Box 7657, Avon, CO 81620.
The statement of additional information contains additional information
about fund directors and officers and is available without charge, upon request,
by calling 1-800-368-3863.
70
Directors
Richard S. Strong
Willie D. Davis
Gordon B. Greer
Stanley Kritzik
Neal Malicky
William F. Vogt
Officers
Richard S. Strong, Chairman of the Board
Thomas M. Zoeller, Vice President
Richard W. Smirl, Vice President and Secretary
Christopher O. Petersen, Vice President and Assistant Secretary
Gilbert L. Southwell III, Assistant Secretary
John W. Widmer, Treasurer
Ane K. Ohm, Anti-Money Laundering Compliance Officer
Investment Advisor
Strong Capital Management, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
Distributor
Strong Investments, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
Custodian
State Street Bank and Trust Company
801 Pennsylvania Avenue, Kansas City, Missouri 64105
Transfer Agent and Dividend-Disbursing Agent
Strong Investor Services, Inc.
P.O. Box 2936, Milwaukee, Wisconsin 53201
Independent Accountants
PricewaterhouseCoopers LLP
100 East Wisconsin Avenue, Milwaukee, Wisconsin 53202
Legal Counsel
Godfrey & Kahn, S.C.
780 North Water Street, Milwaukee, Wisconsin 53202
This report does not constitute an offer for the sale of securities. Strong
Funds are offered for sale by prospectus only. Securities are offered through
Strong Investments, Inc. RT35733 08-03
Strong Investments
P.O. Box 2936 | Milwaukee, WI 53201
www.Strong.com
- --------------------------------------------------------------------------------
To order a free prospectus kit, call
1-800-368-1030
To learn more about our funds, discuss an existing
account, or conduct a transaction, call
1-800-368-3863
If you are a Financial Professional, call
1-800-368-1683
Visit our web site at
www.Strong.com
[STRONG LOGO]
SGRO/WH2150 06-03
Item 2. Code of Ethics
Not applicable for filing of Semiannual Reports to Shareholders.
Item 3. Audit Committee Financial Expert
Not applicable for filing of Semiannual Reports to Shareholders.
Item 4. Principal Accountant Fees and Services
Not applicable for filing of Semiannual Reports to Shareholders.
Item 5 - 6. [Reserved]
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies
Not applicable to this Registrant, insofar as the Registrant is not a
closed-end management investment company.
Item 8. [Reserved]
Item 9. Controls and Procedures
(a) An evaluation was performed within 90 days from the date hereof
under the supervision of the Registrant's management, including the
principal executive officer and treasurer, regarding the effectiveness
of the registrant's disclosure controls and procedures. Based on that
evaluation, it was determined that such disclosure controls and
procedures provide reasonable assurance that the material information
required to be disclosed by the Registrant in the reports it files or
submits on Form N-CSR (1) is accumulated and communicated to the
Registrant's management, including its principal executive officer and
treasurer, to allow timely decisions regarding required disclosure, and
(2) is recorded, processed, summarized, and reported within the time
periods specified in the Commission's rules and forms.
(b) There were no significant changes in the Registrant's internal
controls or in other factors that could significantly affect these
controls subsequent to the date of the evaluation referenced in (a)
above, including any corrective actions with regard to significant
deficiencies and material weaknesses.
Item 10. Exhibits
The following exhibits are attached to this Form N-CSR:
10(b)(1) Certification of Principal Executive Officer Required by
Section 302 of the Sarbanes-Oxley Act of 2002
10(b)(2) Certification of Principal Financial Officer Required by
Section 302 of the Sarbanes-Oxley Act of 2002
10(c) Certification of Chief Executive Officer and Chief
Financial Officer Required by Section 906 of the
Sarbanes-Oxley Act of 2002
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.
Strong Large Cap Growth Fund, Inc.
By: /s/ Richard W. Smirl
-------------------------------------
Richard W. Smirl, Vice President and Secretary
Date: August 22, 2003
---------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Richard S. Strong
-------------------------------------
Richard S. Strong, Principal Executive Officer
Date: August 22, 2003
---------------
By: /s/ John W. Widmer
-------------------------------------
John W. Widmer, Treasurer (Principal Financial Officer)
Date: August 22, 2003
---------------