-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CT+X359QParxx27pgDGKo3vFU5+GU/cpZ44cVjhiPC/ugMZUgc40ZrMduM0KluoQ txECDp66RHVnCYyaK4uHeQ== 0001047469-99-034048.txt : 19990831 0001047469-99-034048.hdr.sgml : 19990831 ACCESSION NUMBER: 0001047469-99-034048 CONFORMED SUBMISSION TYPE: N-30B-2 PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990630 FILED AS OF DATE: 19990830 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MAIRS & POWER GROWTH FUND INC CENTRAL INDEX KEY: 0000061628 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 416019924 STATE OF INCORPORATION: MN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30B-2 SEC ACT: SEC FILE NUMBER: 811-00802 FILM NUMBER: 99702223 BUSINESS ADDRESS: STREET 1: 332 MINNESOTA ST STE W-2062 STREET 2: FIRST NATIONAL BANK BUILDING CITY: ST PAUL STATE: MN ZIP: 55101 BUSINESS PHONE: 6122228478 MAIL ADDRESS: STREET 1: FIRST NATIONAL BANK BUILDING W-2062 STREET 2: 332 MINNESOTA STREET CITY: ST PAUL STATE: MN ZIP: 55101 FORMER COMPANY: FORMER CONFORMED NAME: MAIRS & POWER FUND INC DATE OF NAME CHANGE: 19680607 N-30B-2 1 N-30B-2 ---------------------------- MAIRS AND POWER GROWTH FUND, INC. ---------------------------- - ------------------------------------------------------------------------------- 2ND QUARTER REPORT June 30, 1999 To Our Shareholders: August 27, 1999 SECOND QUARTER RESULTS On June 30, 1999, the net asset value per share of Mairs and Power Growth Fund was $101.63, a 10.0% increase from the year-end valuation after adjustment for reinvestment of the June dividend. This compares with returns of 12.3% for the Standard and Poor's 500 Stock Index and 8.5% for the Russell 2000. For the ten year period ending June 30, the Fund registered a 20.1% average annual return, outpacing returns of 18.8% for the Standard and Poor's 500 Stock Index and 12.4% for the Russell 2000, as well as 15.0% for the average U.S. stock fund. FORBES magazine, in the August 23 issue, presented its annual survey of mutual funds covering 1,200 funds. The survey includes a list of twenty stock funds designated Best Buys based on three things that matter: risk, returns and costs. For the third consecutive year, Mairs and Power Growth Fund appeared on this list. These twenty funds were also ranked for tax efficiency and the Fund was one of only two that received an A grade in that category. SMART MONEY magazine featured the Best Mutual Funds in its September issue. Twenty-six stock funds were designated finalists in that survey based on performance, tax efficiency, management experience and low expenses. Mairs and Power Growth Fund ranked 8th out of these twenty-six funds. The U.S. economy continues its remarkable performance. During the first six months of the year, Gross Domestic Product rose at an annual rate of 3.1% after adjustment for inflation. Consumer spending and business investment remain strong with leading indicators of future activity pointing to solid growth during the balance of the year. The economy is now in the ninth year of expansion and economists are in general agreement that growth should continue at least through next year. The inflation component of G.D.P. registered a 1.5% annual rate of increase during the six month period, reflecting an overall absence of inflationary pressures. However, the Federal Reserve Board has taken two steps in recent weeks to raise short term interest rates, partially reversing the reductions made in late 1998 during a period of global distress. Stock prices have risen this year, properly reflecting investor confidence in the durability of the economic and profit expansions. Corporate earnings have been robust and have generally been meeting or exceeding expectations. Intense world-wide competition has prevented companies from boosting earnings through price increases which has encouraged cost-cutting through innovation and heavy investment in information technology. This, in turn, has increased productivity, which holds inflation at bay. While the stock market is always subject to periodic corrections, we believe that solid earnings growth should provide an upward bias to stock prices in the final months of the year. George A. Mairs President SCHEDULE OF INVESTMENTS JUNE 30, 1999 - -------------------------------------------------------------------------------
NUMBER OF MARKET SHARES COMMON STOCKS VALUE ----------- ---------------------------------------- -------------- CHEMICAL 6.5% 510,000 Ecolab, Inc. $ 22,248,750 222,500 H. B. Fuller 15,213,437 ------------ 37,462,187 ------------ CONSUMER 10.2% 247,000 General Mills, Inc. 19,852,625 490,000 Hormel Foods 19,722,500 282,610 Jostens, Inc. 5,952,473 345,800 The Toro Company 13,615,875 ------------ 59,143,473 ------------ DRUGS AND HOSPITAL SUPPLIES 9.7% 282,000 Baxter International, Inc. 17,096,250 215,000 Johnson & Johnson 21,070,000 166,000 Pfizer Inc. 18,218,500 ------------ 56,384,750 ------------ FINANCIAL 15.5% 330,000 ReliaStar Financial Corporation 14,437,500 426,000 St. Paul Companies, Inc. 13,552,125 640,000 TCF Financial Corporation 17,840,000 540,000 US Bancorp 18,360,000 600,000 Wells Fargo & Company 25,650,000 ------------ 89,839,625 ------------ INFORMATION SERVICES 8.8% 470,000 Deluxe Corp. 18,300,625 981,500 Merrill Corporation 14,231,750 538,400 National Computer Systems Inc. 18,171,000 ------------ 50,703,375 ------------ MEDICAL DEVICES 6.8% 326,000 Medtronic, Incorporated 25,387,250 395,000 St. Jude Medical, Inc. * 14,071,875 ------------ 39,459,125 ------------ RETAILING 6.7% 348,000 Dayton Hudson Corporation 22,620,000 628,000 SUPERVALU Inc. 16,131,750 ------------ 38,751,750 ------------ TECHNOLOGY 16.8% 400,000 Ceridian * 13,075,000 308,050 Emerson Electric Co. 19,368,644 210,000 Honeywell Inc. 24,333,750 1,202,100 MTS Systems Corporation 14,650,594 213,000 Minnesota Mining & Manufacturing Company 18,517,687 618,500 TSI Inc. 7,190,063 ------------ 97,135,738 ------------ TELECOMMUNICATIONS 4.4% 554,000 ADC Telecommunications Inc. * 25,241,625 ------------ OTHER INDUSTRIALS 13.6% 384,000 Bemis Company, Inc. 15,264,000 892,300 BMC Industries, Inc. 9,201,844 450,000 Burlington Northern Santa Fe 13,950,000 534,800 Donaldson Company, Inc. 13,102,600 609,850 Graco Inc. 17,914,344 265,800 Imation Corporation * 6,595,162 74,200 The Valspar Corporation 2,819,600 ------------ 78,847,550 ------------ TOTAL COMMON STOCKS 99.0% $572,969,198 ------------ OTHER ASSETS IN EXCESS OF LIABILITIES 1.0% 5,852,914 ------------ NET ASSETS 100% $578,822,112 ------------ ------------
*Non-income producing
STATEMENT OF NET ASSETS AT JUNE 30, 1999 - ------------------------------------------------------------------------------------------------------------------ ASSETS Investments as annexed, at market value (cost $392,144,719)...................................... $ 572,969,198 Cash............................................................................................. 5,457,634 Dividends and interest receivable................................................................ 509,583 Receivables for securities sold, not yet delivered............................................... 248,792 Prepaid expense.................................................................................. 7,114 -------------- 579,192,321 LIABILITIES Accrued management fee................................................. $ 285,051 Accrued custodian and transfer agent fee............................... 85,158 Payable for securities purchased, not yet received..................... 0 370,209 ----------- -------------- NET ASSETS Equivalent to $101.63 per share on 5,695,339 shares outstanding.................................. $ 578,822,112 -------------- -------------- STATEMENT OF CHANGES IN NET ASSETS FOR THE SIX MONTHS ENDED JUNE 30, 1999 - ------------------------------------------------------------------------------------------------------------------ NET ASSETS, December 31, 1998.................................................................... $ 580,460,523 Net investment income, per statement below............................. $ 2,365,235 Reversal of Capital Gain Distribution Paid............................. 1,660 Distribution to Shareholders........................................... (1,992,917) 373,978 ------------ Fund shares issued and repurchased: Received for 401,998 shares issued.................................. 37,596,678 Paid for 969,492 shares repurchased................................. (90,542,826) (52,946,148) ------------ Increase in unrealized net appreciation (depreciation) of investments............................ 25,668,776 Net gain (or loss) realized from sales of securities............................................. 25,264,983 -------------- NET ASSETS, June 30, 1999........................................................................ $ 578,822,112 -------------- -------------- STATEMENT OF NET INVESTMENT INCOME FOR THE SIX MONTHS ENDED JUNE 30, 1999 - ------------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME Dividends........................................................................................ $ 4,430,006 Interest......................................................................................... 189,414 -------------- 4,619,420 EXPENSES Management fee (Note A)................................................ $ 1,686,278 Fees and expenses of custodian, transfer agent and dividend disbursing agent (Note A)................................. 285,325 Legal and auditing fees and expenses................................... 15,934 Insurance.............................................................. 6,690 Other Fees and Expenses................................................ 259,958 2,254,185 ------------ -------------- NET INVESTMENT INCOME............................................................................ $ 2,365,235 -------------- --------------
NOTE A: The investment advisory fee was paid to Mairs and Power, Inc., which is owned by individuals who are directors and officers of the Fund, for its services as investment adviser. Investment advisory fees are paid to the adviser pursuant to an advisory agreement approved by the Directors of the Fund. The advisory fee is computed each month and is 1/20th of one percent of the net asset value of the Fund on the last valuation day of the month. The transfer agent fee was also paid to Firstar Mutual Fund Services, LLC which serves as transfer agent. SUPPLEMENTARY INFORMATION: 1) Each director of the Fund not affiliated with Mairs and Power, Inc. received $10,800 compensation for meetings attended during this six month period. No compensation was paid to any other director or officer of the Fund. 2) No provision has been made for federal income taxes as it is the intention of the Fund to comply with the provisions of the Internal Revenue Code available to investment companies and to make distributions of income and security profits which will be sufficient to relieve it from all or substantially all income taxes. 3) Purchases and sales of investment securities during the six months ended June 30, 1999 aggregated $8,852,140 and $50,297,013 respectively. ---------------------------- MAIRS AND POWER GROWTH FUND, INC. ---------------------------- A NO-LOAD FUND W-1420 First National Bank Building, 332 Minnesota Street, St. Paul, Minnesota 55101-1363 651-222-8478 Shareholder Information: 800-304-7404 SUMMARY OF FINANCIAL INFORMATION - ------------------------------------------------------------------------------- This table covers a period of generally rising common stock prices. The results shown should not be considered as a representation of the dividend income or capital gain or loss which may result from an investment made in the Fund today.
PER SHARE --------------------------------------------- DISTRIBUTIONS DIVIDENDS OF REALIZED FROM NET SHARES TOTAL NET NET ASSET SECURITIES INVESTMENT DATES OUTSTANDING ASSETS VALUE GAINS INCOME ------------- ----------- ------------ --------- ------------- ----------- Dec. 31, 1979 914,635 $ 14,104,765 $15.42 - $0.45 Dec. 31, 1980 840,882 14,540,014 17.29 - 0.55 Dec. 31, 1981 861,678 13,148,158 15.26 $0.74 0.60 Dec. 31, 1982 850,942 16,784,217 19.72 0.58 0.50 Dec. 31, 1983 881,592 18,972,177 21.52 0.70 0.48 Dec. 31, 1984 872,069 17,304,204 19.84 0.76 0.46 Dec. 31, 1985 856,738 21,553,457 25.16 0.86 0.46 Dec. 31, 1986 893,850 22,235,453 24.88 2.74 0.40 Dec. 31, 1987 914,139 19,816,097 21.68 2.29 0.48 Dec. 31, 1988 929,039 20,630,251 22.21 1.21 0.41 Dec. 31, 1989 866,584 22,630,081 26.11 1.83 0.43 Dec. 31, 1990 867,432 22,501,587 25.94 0.70 0.42 Dec. 31, 1991 904,023 31,440,529 34.78 1.58 0.39 Dec. 31, 1992 956,814 34,363,306 35.91 1.16 0.40 Dec. 31, 1993 1,006,285 39,081,010 38.84 1.22 0.43 Dec. 31, 1994 1,064,019 41,889,850 39.37 0.98 0.65 Dec. 31, 1995 1,245,325 70,536,880 56.64 1.51 0.56 Dec. 31, 1996 2,161,246 150,161,759 69.48 1.39 0.71 Dec. 31, 1997 4,760,515 412,590,619 86.67 1.69 1.00 Dec. 31, 1998 6,262,832 580,460,523 92.68 1.36 0.72 Jun. 30, 1999 5,695,339 578,822,112 101.63 - 0.35
No adjustment has been made for any income tax payable by shareholders on capital gain distributions accepted in shares. This report is not to be used in connection with the offering of shares of the Fund unless accompanied or preceded by an effective Prospectus. Please call or write if you desire further information. - -------------------------------------------------------------------------------- AVERAGE ANNUAL TOTAL RETURNS THE AVERAGE ANNUAL TOTAL RETURNS FOR THE FUND (PERIODS ENDED JUNE 30,1999) ARE AS FOLLOWS: - -------------------------------------------------------------------------------- 1 YEAR: 12.3% 5 YEARS: +25.6% 10 YEARS: +20.1% - -------------------------------------------------------------------------------- PAST INVESTMENT RESULTS SHOULD NOT BE TAKEN AS NECESSARILY REPRESENTATIVE OF FUTURE PERFORMANCE. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. - -------------------------------------------------------------------------------- OFFICERS AND DIRECTORS - -------------------------------------------------------------------------------- George A. Mairs, III William B. Frels Peter G. Robb President and Director Secretary and Director Vice-President and Director Lisa J. Hartzell Charlton Dietz Donald E. Garretson Treasurer Director Director J. Thomas Simonet Director -----END PRIVACY-ENHANCED MESSAGE-----