<IMS-DOCUMENT>0000950156-95-000635.txt : 19950829
<IMS-HEADER>0000950156-95-000635.hdr.sgml : 19950829
ACCESSION NUMBER: 0000950156-95-000635
CONFORMED SUBMISSION TYPE: N-30B-2
PUBLIC DOCUMENT COUNT: 1
CONFORMED PERIOD OF REPORT: 19950630
FILED AS OF DATE: 19950828
SROS: NONE

FILER:

COMPANY DATA:
COMPANY CONFORMED NAME: LANDMARK FIXED INCOME FUNDS /MA/
CENTRAL INDEX KEY: 0000795808
STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000]
STATE OF INCORPORATION: MA
FISCAL YEAR END: 0831

FILING VALUES:
FORM TYPE: N-30B-2
SEC ACT: 1940 Act
SEC FILE NUMBER: 811-05033
FILM NUMBER: 95567377

BUSINESS ADDRESS:
STREET 1: 6ST JAMES AVE 9TH FL
CITY: BOSTON
STATE: MA
ZIP: 02116
BUSINESS PHONE: 6174231679

FORMER COMPANY:
FORMER CONFORMED NAME: LANDMARK FIXED INCOME FUNDS/
DATE OF NAME CHANGE: 19931117

FORMER COMPANY:
FORMER CONFORMED NAME: LANDMARK FIXED INCOME FUNCS/DE
DATE OF NAME CHANGE: 19931115

FORMER COMPANY:
FORMER CONFORMED NAME: LANDMARK U S GOVERNMENT INCOME FUND
DATE OF NAME CHANGE: 19920703
</IMS-HEADER>
<DOCUMENT>
<TYPE>N-30B-2
<SEQUENCE>1
<DESCRIPTION>LANDMARK FIXED INCOME FUNDS SA
<TEXT>

<PAGE>

[LOGO] LANDMARK(SM) FUNDS
Advised by Citibank, N.A.

Landmark
U.S. Government
Income Fund

SEMI-ANNUAL
REPORT
June 30, 1995
<PAGE>

--------------------------------------------------------------------------------
A LETTER TO OUR SHAREHOLDERS
--------------------------------------------------------------------------------

Dear Shareholder:

The first six months of 1995 saw higher prices for most financial assets,
including the U.S. government securities in which the Landmark U.S. Government
Income Fund primarily invests through the Government Income Portfolio. In fact,
bonds have rallied significantly since the beginning of the year, more than
erasing any declines posted in 1994.

The Landmark Funds' investment adviser, Citibank, N.A., manages the
Government Income Portfolio to provide current income as well as to preserve the
value of the investment of its shareholders. The Portfolio seeks to provide an
attractive yield, a competitive expense ratio and a high quality investment
portfolio consisting solely of securities backed by the full faith and credit of
the U.S. government.

This Semi-Annual Report for the period ended June 30, 1995, reviews the
Fund's investment activities and performance over the past six months and
provides a summary of Citibank's perspective on the financial markets and
outlook for the foreseeable future. On behalf of the Board of Trustees of the
Landmark Funds, we want to thank our shareholders for their participation and
support. We look forward to serving you in the months and years ahead.

/s/ Philip W. Coolidge

Philip W. Coolidge
President
July 20, 1995
<PAGE>

TABLE OF CONTENTS

1 Letter to Shareholders
------------------------------------------
Market Environment
2 Fund Snapshot
Portfolio Manager
------------------------------------------
The Portfolio Manager Responds
3 Fund Quotes
Strategy and Outlook
------------------------------------------
4 Fund Data
Performance Highlights
------------------------------------------

LANDMARK U.S. GOVERNMENT INCOME FUND

5 Statement of Assets and Liabilities
------------------------------------------
6 Statement of Operations
------------------------------------------
7 Statement of Changes in Net Assets
------------------------------------------
8 Financial Highlights
------------------------------------------
9 Notes to Financial Statements
------------------------------------------

GOVERNMENT INCOME PORTFOLIO

11 Portfolio of Investments
------------------------------------------
12 Statement of Assets and Liabilities
Statement of Operations
------------------------------------------
13 Statement of Changes in Net Assets
Financial Highlights
------------------------------------------
14 Notes to Financial Statements
------------------------------------------

Remember that Mutual Fund Shares:
o Are not bank deposits or FDIC insured
o Are not obligations of or guaranteed by Citibank or Citicorp Investment
Services
o Are subject to Investment risks, including possible loss of the
principal amount invested
<PAGE>
--------------------------------------------------------------------------------
MARKET ENVIRONMENT
--------------------------------------------------------------------------------

The first six months of 1995 represented the best first-half performance by
the U.S. bond market since 1985. Prices on the benchmark 30-year U.S. Treasury
bond rose 15.4% during the period. Prices on the three-year U.S. Treasury note,
considered by many to be a good measure of short- to intermediate-term
fixed-income performance, rose 5.0%.
Slower economic growth is the primary reason for the bond market's
excellent performance after a disappointing 1994. Fixed-income investors appear
to be convinced that the Federal Reserve has been largely successful in its
efforts to constrain economic growth without causing either a recession or an
acceleration of inflation. Recent economic data suggest that the U.S. is
experiencing a "soft landing" after 1994's torrid pace of economic growth, a
state of affairs that raises expectations for continued economic expansion with
low inflation and, perhaps most important, no need for the Federal Reserve to
raise short-term interest rates further. Low inflation tends to be good for
bonds as investors worry less that rising prices will erode the purchasing power
of their principal and income over time.

--------------------------------------------------------------------------------
FUND SNAPSHOT
--------------------------------------------------------------------------------

COMMENCEMENT OF OPERATIONS
September 8, 1986

NET ASSETS AS OF 6/30/95
$51.0 million

FUND OBJECTIVE
To generate current income and preserve the value of its shareholders'
investment.

DIVIDENDS
Paid monthly, if any

CAPITAL GAINS
Paid annually, if any

BENCHMARKS
o Lipper Short U.S. Government Funds Average
o Lehman 1-5 Year U.S. Treasury Index

INVESTMENT ADVISER,
GOVERNMENT INCOME PORTFOLIO
Citibank, N.A.

--------------------------------------------------------------------------------
PORTFOLIO MANAGER
--------------------------------------------------------------------------------

Thomas Halley
Vice President, Citibank, N.A.

Mr. Halley has been responsible for managing the Portfolio since its inception
after serving as the manager of the Fund since December 1988. He also manages
other commingled investment funds at Citibank as well as institutional insurance
portfolios.

Mr. Halley authors the commentary on economic trends for Citibank Global Asset
Management publications. Prior to joining Citibank in 1988, Mr. Halley was a
Senior Fixed Income Portfolio Manager with Brown Brothers Harriman & Company. He
has more than 20 years of experience in the management of taxable fixed income
investments.

--------------------------------------------------------------------------------
THE PORTFOLIO MANAGER RESPONDS
--------------------------------------------------------------------------------

We began the year with an average duration (a measure of the portfolio's
sensitivity to changes in interest rates) in the neutral range in order to
maintain competitive yields while remaining flexible enough to take advantage of
higher yielding securities if they became available. As it became clear that
economic growth was moderating, we lengthened the average maturity somewhat to
keep higher-yielding securities in the portfolio for as long as possible. This
stance put us in a good position to capture further gains as interest rates
continued to fall.
Consistent with our sector rotation strategy, we continue to shift assets
between U.S. Treasury securities and government-backed mortgage-backed
securities issued by the Government National Mortgage Association (GNMA). During
the period, we reduced our exposure to GNMA securities from approximately 22% of
the portfolio to about 4% in order to avoid the effects of early prepayments by
homeowners in a lower interest-rate environment.

--------------------------------------------------------------------------------
FUND QUOTES FROM THE PORTFOLIO MANAGER
--------------------------------------------------------------------------------

"We've seen a tremendous rally in the bond market during the first six months of
this year, including the maturity range in which the Portfolio invests."

"As it became obvious that the economy was slowing, the bond market became
convinced that inflation wouldn't be the problem investors feared it would be
last year."

"The key question for the next six months is whether consumers will resume
spending and trigger a rebound in the economy, or whether the current
deceleration toward a `soft landing' remains on track."

--------------------------------------------------------------------------------
STRATEGY AND OUTLOOK
--------------------------------------------------------------------------------

In the wake of the healthy gains achieved by the bond market during the
first half of the year, we have adopted a more cautious stance, reflecting our
conservative management style and our belief that the market has fully
incorporated a "soft landing" economic scenario.

While a market correction is possible over the near term if the economy
strengthens, the relatively short average duration of the Government Income
Portfolio should help to shelter shareholders from the brunt of any setbacks
affecting the overall market over the near term. Over the longer term, our
outlook calls for a true deceleration of economic growth. If the economy does
moderate further, the Federal Reserve may lower interest rates, a move that
should boost bond prices in every maturity range. Therefore, we will view any
near-term market correction as an opportunity to participate in the attractive
fixed-income returns we believe are ahead.

--------------------------------------------------------------------------------
FUND DATA ALL PERIODS ENDED JUNE 30, 1995 (UNAUDITED)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
TOTAL RETURNS
------------------------------------------------
SINCE
SIX ONE FIVE 9/8/86
MONTHS<F1> YEAR YEARS<F2> INCEPTION<F2>
------ ---- ---------- ----------
<S> <C> <C> <C> <C>
Landmark U.S. Government Income Fund
without Sales Charge........................... 7.45% 8.02% 7.42% 6.58%
Lipper Short U.S. Government Funds Average....... 6.77% 7.33% 6.77% 6.60%<F3>
Lehman 1-5 Year U.S. Treasury Index.............. 7.94% 8.71% 7.93% 7.61%<F3>
Landmark U.S. Government Income Fund
with Maximum Sales Charge of 1.50%........... 5.85% 6.40% 7.09% 6.40%

<FN>
<F1> Not annualized
<F2> Annualized
<F3> From 8/31/86
</TABLE>

30-Day SEC Yield 5.24%
Income Dividends Per Share $0.234
<PAGE>

--------------------------------------------------------------------------------
PERFORMANCE HIGHLIGHTS
--------------------------------------------------------------------------------

A $10,000 investment in the Fund made on inception date would have grown to
$17,277 with sales charge (as of 6/30/95). The graph shows how this compares to
our benchmarks over the same period.

The graph includes the initial sales charge on the Fund (no comparable charge
exists for the other indices) and assumes all dividends and distributions from
the Fund are reinvested at Net Asset Value.

[The following data is presented as a graph in the printed report]

Landmark Landmark
U.S. U.S.
Government Government Lipper Lehman 1-5
Income - Income - Short Term Yr. US
Without With US Govt. Treasury
Sales Sales Funds Index
Charge Charge Average (Unmanaged)

Aug-86 $10,000 $9,850 $10,000 $10,000
Sep-86 $9,660 $9,515 $9,975 $9,958
Oct-86 $9,682 $9,537 $10,085 $10,065
Nov-86 $9,847 $9,700 $10,193 $10,136
Dec-86 $9,881 $9,733 $10,225 $10,155
Jan-87 $9,982 $9,832 $10,322 $10,233
Feb-87 $10,053 $9,902 $10,383 $10,283
Mar-87 $9,985 $9,835 $10,373 $10,289
Apr-87 $9,792 $9,646 $10,208 $10,176
May-87 $9,788 $9,641 $10,212 $10,178
Jun-87 $9,909 $9,761 $10,325 $10,294
Jul-87 $9,904 $9,755 $10,353 $10,339
Aug-87 $9,866 $9,718 $10,348 $10,340
Sep-87 $9,655 $9,511 $10,263 $10,267
Oct-87 $9,965 $9,816 $10,492 $10,515
Nov-87 $10,025 $9,874 $10,555 $10,583
Dec-87 $10,151 $9,999 $10,634 $10,665
Jan-88 $10,479 $10,322 $10,860 $10,863
Feb-88 $10,619 $10,459 $10,965 $10,963
Mar-88 $10,523 $10,365 $10,953 $10,959
Apr-88 $10,495 $10,337 $10,956 $10,961
May-88 $10,455 $10,298 $10,938 $10,935
Jun-88 $10,633 $10,473 $11,060 $11,100
Jul-88 $10,592 $10,433 $11,062 $11,091
Aug-88 $10,574 $10,415 $11,079 $11,103
Sep-88 $10,744 $10,583 $11,222 $11,255
Oct-88 $10,869 $10,706 $11,341 $11,385
Nov-88 $10,780 $10,618 $11,294 $11,325
Dec-88 $10,785 $10,624 $11,314 $11,339
Jan-89 $10,922 $10,758 $11,413 $11,433
Feb-89 $10,818 $10,656 $11,407 $11,414
Mar-89 $10,856 $10,693 $11,452 $11,463
Apr-89 $11,044 $10,878 $11,606 $11,675
May-89 $11,305 $11,136 $11,781 $11,857
Jun-89 $11,595 $11,421 $11,995 $12,115
Jul-89 $11,818 $11,641 $12,165 $12,329
Aug-89 $11,596 $11,422 $12,079 $12,208
Sep-89 $11,628 $11,453 $12,138 $12,271
Oct-89 $11,955 $11,776 $12,335 $12,493
Nov-89 $12,061 $11,880 $12,437 $12,608
Dec-89 $12,080 $11,899 $12,486 $12,654
Jan-90 $11,867 $11,689 $12,467 $12,627
Feb-90 $11,880 $11,702 $12,524 $12,684
Mar-90 $11,864 $11,686 $12,562 $12,709
Apr-90 $11,671 $11,496 $12,576 $12,711
May-90 $12,058 $11,878 $12,763 $12,938
Jun-90 $12,265 $12,081 $12,893 $13,090
Jul-90 $12,441 $12,254 $13,044 $13,265
Aug-90 $12,260 $12,077 $13,065 $13,280
Sep-90 $12,357 $12,172 $13,162 $13,392
Oct-90 $12,523 $12,335 $13,296 $13,560
Nov-90 $12,807 $12,615 $13,442 $13,716
Dec-90 $13,034 $12,839 $13,593 $13,893
Jan-91 $13,183 $12,985 $13,716 $14,029
Feb-91 $13,258 $13,059 $13,795 $14,113
Mar-91 $13,309 $13,110 $13,870 $14,201
Apr-91 $13,442 $13,240 $13,998 $14,345
May-91 $13,510 $13,307 $14,078 $14,430
Jun-91 $13,454 $13,252 $14,107 $14,465
Jul-91 $13,659 $13,454 $14,244 $14,609
Aug-91 $13,982 $13,772 $14,445 $14,850
Sep-91 $14,324 $14,109 $14,613 $15,052
Oct-91 $14,459 $14,242 $14,762 $15,228
Nov-91 $14,535 $14,317 $14,902 $15,401
Dec-91 $14,833 $14,610 $15,152 $15,698
Jan-92 $14,733 $14,512 $15,063 $15,618
Feb-92 $14,802 $14,580 $15,024 $15,658
Mar-92 $14,777 $14,555 $14,937 $15,621
Apr-92 $14,863 $14,640 $15,059 $15,772
May-92 $15,058 $14,832 $15,217 $15,965
Jun-92 $15,215 $14,987 $15,375 $16,172
Jul-92 $15,410 $15,179 $15,560 $16,424
Aug-92 $15,512 $15,279 $15,687 $16,590
Sep-92 $15,649 $15,414 $15,816 $16,791
Oct-92 $15,502 $15,269 $15,693 $16,623
Nov-92 $15,483 $15,251 $15,668 $16,567
Dec-92 $15,657 $15,422 $15,818 $16,752
Jan-93 $15,865 $15,627 $16,017 $17,017
Feb-93 $16,022 $15,781 $16,170 $17,216
Mar-93 $16,078 $15,837 $16,221 $17,275
Apr-93 $16,177 $15,934 $16,312 $17,406
May-93 $16,125 $15,883 $16,293 $17,347
Jun-93 $16,303 $16,059 $16,444 $17,534
Jul-93 $16,295 $16,051 $16,488 $17,566
Aug-93 $16,534 $16,286 $16,650 $17,776
Sep-93 $16,600 $16,351 $16,697 $17,835
Oct-93 $16,637 $16,387 $16,725 $17,878
Nov-93 $16,555 $16,307 $16,677 $17,838
Dec-93 $16,608 $16,359 $16,737 $17,910
Jan-94 $16,709 $16,458 $16,850 $18,058
Feb-94 $16,524 $16,276 $16,711 $17,874
Mar-94 $16,330 $16,085 $16,538 $17,699
Apr-94 $16,208 $15,965 $16,421 $17,596
May-94 $16,240 $15,996 $16,391 $17,616
Jun-94 $16,238 $15,995 $16,390 $17,642
Jul-94 $16,408 $16,162 $16,523 $17,835
Aug-94 $16,441 $16,194 $16,561 $17,890
Sep-94 $16,353 $16,107 $16,503 $17,793
Oct-94 $16,369 $16,123 $16,512 $17,816
Nov-94 $16,280 $16,035 $16,446 $17,727
Dec-94 $16,323 $16,079 $16,483 $17,768
Jan-95 $16,569 $16,320 $16,687 $18,038
Feb-95 $16,797 $16,545 $16,926 $18,330
Mar-95 $16,884 $16,630 $17,014 $18,433
Apr-95 $17,060 $16,804 $17,160 $18,623
May-95 $17,452 $17,190 $17,498 $19,001
Jun-95 $17,540 $17,277 $17,586 $19,115

Notes: All Fund performance numbers represent past performance, and are no
guarantee of future results. The Fund's share price and investment return will
fluctuate, so that the value of an investor's shares, when redeemed, may be
worth more or less than their original cost. Total returns include change in
share price and reinvestment of dividends and distributions, if any. Total
return figures "with sales charge" are provided in accordance with SEC
guidelines for comparative purposes for prospective investors.

<PAGE>
--------------------------------------------------------------------------------
Landmark U.S. Government Income Fund
STATEMENT OF ASSETS AND LIABILITIES June 30, 1995 (unaudited)
--------------------------------------------------------------------------------

ASSETS:
Investment in Government Income Portfolio, at value (Note 1). $51,044,453
Other assets................................................. 4,200
-----------
Total assets............................................. 51,048,653
-----------

LIABILITIES:
Payable for shares of beneficial interest repurchased........ 72,286
Accrued expenses and other liabilities....................... 1,315
-----------
Total liabilities........................................ 73,601
-----------

NET ASSETS for 5,241,202 shares of beneficial
interest outstanding........................................ $50,975,052
. ===========

NET ASSETS CONSIST OF:
Paid-in capital.............................................. $54,902,420
Accumulated net realized loss on investments................. (4,101,698)
Unrealized appreciation of investments....................... 37,194
Undistributed net investment income.......................... 137,136
-----------
Total.................................................... $50,975,052
===========

NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE OF BENEFICIAL INTEREST .............................. $9.73
=====

COMPUTATION OF OFFERING PRICE:
Maximum Offering Price per share based
on a 1.50% sales charge ($9.73/0.985)................. ..... $9.88
=====

See notes to financial statements
<PAGE>

--------------------------------------------------------------------------------
Landmark U.S. Government Income Fund
STATEMENT OF OPERATIONS
For the six months ended June 30, 1995 (unaudited)
--------------------------------------------------------------------------------

INVESTMENT INCOME (Note 1B):
Interest Income from Government Income Portfolio........ $1,579,973
Allocated Expenses from Government Income Portfolio..... (96,834)
-----------
Net investment income from Government
Income Portfolio. ................................. $1,483,139

EXPENSES:
Shareholder Servicing Agents' fees (Note 2B)............ $ 102,918
Administrative fees (Note 2A)........................... 42,912
Distribution fees (Note 3).............................. 12,865
Legal fees.............................................. 9,866
Shareholder reports..................................... 8,323
Trustees' fees.......................................... 6,917
Transfer agent fees..................................... 6,000
Auditing fees........................................... 5,627
Custodian fees.......................................... 3,600
Miscellaneous........................................... 4,541
----------
Total expenses...................................... 203,569

Less aggregate amount waived by Administrator,
Shareholder Servicing Agents, and Distributor
(Notes 2A, 2B and 3)................. (94,372)
----------
Net expenses....................................... 109,197
----------
Net investment income.............................. 1,373,942
----------

NET REALIZED AND UNREALIZED GAIN (LOSS) FROM GOVERNMENT INCOME PORTFOLIO:
Net realized gain (loss)................................ 239,928
Net change in unrealized appreciation (depreciation).... 2,084,127
----------
Net realized and unrealized gain (loss)
from Government Income Portfolio 2,324,055
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ... $3,697,997
==========

See notes to financial statements

<PAGE>

--------------------------------------------------------------------------------
Landmark U.S. Government Income Fund
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------

Six Months Ended Year Ended
June 30, 1995 December 31,
(unaudited) 1994
------------- -----------------
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS:
Net investment income..................... $ 1,373,942 $ 3,219,042
Net realized gain (loss) on
investment transactions.................. 239,928 (2,780,042)
Net change in unrealized
appreciation (depreciation)
of investments .......................... 2,084,127 (1,924,684)
------------- -------------

Net increase (decrease) in net
assets resulting from operations 3,697,997 (1,485,684)
------------- -------------

DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income..................... (1,267,821) (3,193,045)
------------- --------------

TRANSACTIONS IN SHARES OF BENEFICIAL
INTEREST (Note 5):
Net proceeds from sale of shares.......... 2,223,931 20,093,238
Net asset value of shares
issued to shareholders
from reinvestment of dividends.......... 1,260,998 3,182,428
Cost of shares repurchased................ (7,873,285) (44,969,764)
------------- --------------
Net decrease in net assets from
transactions in shares of
beneficial interest..................... (4,388,356) (21,694,098)
------------- --------------
NET DECREASE IN NET ASSETS ............... (1,958,180) (26,372,827)

Net Assets:
Beginning of period....................... 52,933,232 79,306,059
-------------- -------------

End of period (including undistributed
net investment income of $137,136 and
$31,015, respectively).................. $ 50,975,052 $ 52,933,232
============== =============

See notes to financial statements
<PAGE>

--------------------------------------------------------------------------------
Landmark U.S. Government Income Fund
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Six Months Four Months
Ended Ended
June 30, Year Ended December 31,
1995, December 31, 1993 Year Ended August 31
(unaudited) 1994 (Note 1F) 1993 1992 1991 1990
----------- -------- -------------- ---- ---- ---- ----

<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
beginning of period ................ $ 9.28 $ 9.91 $ 10.01 $ 9.85 $ 9.42 $ 8.93 $ 9.08
------- ------- ------- ------- ------- ------- -------
Income From Operations:
Net investment income .............. 0.255 0.466 0.183 0.448 0.591 0.710 0.653
Net realized and unrealized
gain (loss) on investments ........ 0.429 (0.635) (0.138) 0.183 0.413 0.499 (0.148)
------- ------- ------- ----- ----- ----- ------
Total from operations .......... 0.684 (0.169) 0.045 0.631 1.004 1.209 0.505
------- ------- ------- ----- ----- ----- -----
Less Distributions From:
Net investment income.......... .. (0.234) (0.461) (0.145) (0.464) (0.574) (0.719) (0.655)
In excess of net investment income -- -- -- (0.007) -- -- --
------- ------- ------- ------- ------- ------- -------
Total from distributions... .. (0.234) (0.461) (0.145) (0.471) (0.574) (0.719) (0.655)
------- ------- ------- ------- ------- ------- -------
Net Asset Value, end of period... .. $ 9.73 $ 9.28 $ 9.91 $10.01 $ 9.85 $ 9.42 $ 8.93
======= ======= ======= ====== ======= ======= =======

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(000's omitted) ................... $50,975 $52,933 $79,306 $82,114 $56,159 $ 25,556 21,521
Ratio of expenses to
average net assets ................ 0.80%+(A) 0.80%(A) 0.80%+ 0.80% 0.51% 0.97% 1.88%
Ratio of net investment income
to average net assets ............. 5.34%+ 4.72% 4.34%+ 4.46% 6.03% 7.71% 7.19%
Portfolio turnover (B) ............. -- 22% 26% 111% 161% 42% 14%
Total return ....................... 7.45%** (1.72)% 0.45%** 6.59% 10.94% 14.04% 5.73%

Note: If Agents of the Fund for the periods indicated and Agents of Government Income Portfolio for the period
May 1, 1994 to December 31, 1994 and for the six months ended June 30, 1995 had not waived a portion of their
fees, the net investment income per share and the ratios would have been as follows:

<S> <C> <C> <C> <C> <C> <C> <C>
Net investment income per share .... $ 0.235 $ 0.421 $ 0.164 $ 0.400 $ 0.503 $ 0.659 $ 0.648
Ratios:
Expenses to average net assets ..... 1.21%+(A) 1.26%(A) 1.27%+ 1.27% 1.41% 1.52% 1.94%
Net investment income to
average net assets ................. 4.93%+ 4.26% 3.88%+ 3.98% 5.13% 7.16% 7.13%

** Not annualized
+ Annualized

(A) Includes the Fund's share of Government Income Portfolio allocated expenses for the period May, 1 1994 to
December 31, 1994 and for the period indicated.
(B) Portfolio turnover represents the rate of portfolio activity for the period while the Fund was making investments
directly in securities. The portfolio turnover rate for the period since the Fund transferred all of its
investable assets to the Portfolio is shown in the Portfolio's financial statements which are included elsewhere
in this report.

See notes to financial statements
</TABLE>

--------------------------------------------------------------------------------
Landmark U.S. Government Income Fund
NOTES TO FINANCIAL STATEMENTS (unaudited)
--------------------------------------------------------------------------------

(1) SIGNIFICANT ACCOUNTING POLICIES
The Landmark U.S. Government Income Fund (the "Fund") is a separate diversified
series of Landmark Fixed Income Funds (the "Trust"), a Massachusetts business
trust. The Trust is registered under the Investment Company Act of 1940, as
amended, as an open-end, management investment company. The Fund invests all of
its investable assets in Government Income Portfolio (the "Portfolio"), a
management investment company for which Citibank, N.A. ("Citibank") serves as
Investment Adviser. The Landmark Funds Broker-Dealer Services, Inc. ("LFBDS")
acts as the Trust's Administrator and Distributor. Citibank also serves as
Sub-Administrator and makes Fund shares available to customers as Shareholder
Servicing Agent.

The Trust seeks to achieve the Fund's investment objective to provide
shareholders with monthly dividends, as well as to protect the value of the
investment of shareholders by investing all of its investable assets in the
Portfolio, an open-end, diversified management investment company having the
same investment objective and policies and substantially the same investment
restrictions as the Fund. The value of such investment reflects the Fund's
proportionate interest (94.6% at June 30, 1995) in the net assets of the
Portfolio.

The financial statements of the Portfolio, including the portfolio of
investments, are contained elsewhere in this report and should be read in
conjunction with the Fund's financial statements.

The significant accounting policies consistently followed by the Fund are in
conformity with generally accepted accounting principles and are as follows:

A. INVESTMENT VALUATION -- Valuation of securities by the Portfolio is discussed
in Note 1A of the Portfolio's Notes to Financial Statements, which are included
elsewhere in this report.

B. INVESTMENT INCOME -- The Fund earns income, net of Portfolio expenses, daily
based on its investment in the Portfolio.

C. FEDERAL TAXES -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders all of its taxable income, including any net realized
gain on investment transactions. Accordingly, no provision for federal income or
excise tax is necessary. At December 31, 1994, the Fund, for federal income tax
purposes, had a capital loss carryover of $3,291,171, of which $714,586 will
expire on December 31, 1995, $835,037 will expire on December 31, 1996 and
$1,741,548 will expire on December 31, 2002. Such capital loss carryover will
reduce the Fund's taxable income arising from future net realized capital gain
on investment transactions, if any, to the extent permitted by the Internal
Revenue Code, and thus will reduce the amount of the distributions to
shareholders which would otherwise be necessary to relieve the Fund of any
liability for federal income or excise tax.

D. EXPENSES -- The Fund bears all costs of its operations other than expenses
specifically assumed by Citibank and LFBDS. Expenses incurred by the Trust with
respect to any two or more funds or series are allocated in proportion to the
average net assets of each fund, except when allocations of direct expenses to
each fund can otherwise be made fairly. Expenses directly attributable to a fund
are charged to that fund. The Fund's share of the Portfolio's expenses are
charged against and reduce the amount of the Fund's investment in the Portfolio.

E. DISTRIBUTIONS -- Distributions to shareholders are recorded on ex-dividend
date. The amount and character of income and net realized gains to be
distributed are determined in accordance with income tax rules and regulations,
which may differ from generally accepted accounting principles. These
differences are attributable to permanent book and tax accounting differences.

Reclassifications are made to the Fund's capital accounts to reflect income and
net realized gains available for distribution (or available capital loss
carryovers) under income tax rules and regulations. For the year ended December
31, 1994, the fund reclassed $212,926 from accumulated net realized loss on
investment to paid-in capital.

F. CHANGE IN FISCAL YEAR END -- Effective September 1, 1993, the Fund changed
its fiscal year end from August 31 to December 31.

G. OTHER -- All the net investment income and realized and unrealized gain and
loss of the Portfolio is allocated pro rata, based on respective ownership
interests, among the Fund and the other investors in the Portfolio at the time
of such determination. Investment transactions are accounted for on a trade date
basis.

(2) ADMINISTRATIVE SERVICES PLAN
The Trust has adopted an Administrative Services Plan which provides that the
Trust, on behalf of the Fund, may obtain the services of an Administrator, one
or more Shareholder Servicing Agents and other Servicing Agents and may enter
into agreements providing for the payment of fees for such services. Under the
Trust Administrative Services Plan, the aggregate of the fee paid to the
Administrator from the Fund, the fees paid to the Shareholder Servicing Agents
from the Fund under such Plan and the Basic Distribution Fee paid from the Fund
to the Distributor under the Distribution Plan may not exceed 0.65% of the
Fund's average daily net assets on an annualized basis for the Fund's
then-current fiscal year.

A. ADMINISTRATIVE FEE -- Under the terms of an Administrative Services
Agreement, the administrative fee paid to the Administrator, as compensation for
overall administrative services and general office facilities, may not exceed an
annual rate of 0.20% of the Fund's average daily net assets. For the six months
ended June 30, 1995, under the Administrative Services Plan the Administrator
received fees computed at an annual rate of 0.15% of the Fund's average daily
net assets which amounted to $42,912, all of which was voluntarily waived.
Citibank acts as Sub-Administrator and performs such duties and receives such
compensation from LFBDS as from time to time is agreed to by LFBDS and Citibank.
The Fund pays no compensation directly to any Trustee or any officer who is
affiliated with the Administrator, all of whom receive remuneration for their
services to the Fund from the Administrator or its affiliates. Certain of the
officers and a Trustee of the Fund are officers or directors of the
Administrator or its affiliates.

B. SHAREHOLDER SERVICING AGENTS FEES -- The Trust, on behalf of the Fund, has
entered into shareholder servicing agreements with each Shareholder Servicing
Agent pursuant to which that Shareholder Servicing Agent acts as an agent for
its customers and provides other related services. For their services, each
Shareholder Servicing Agent receives fees from the Fund, which may be paid
periodically, which may not exceed, on an annualized basis, an amount equal to
0.40% of the average daily net assets of the Fund represented by shares owned
during the period for which payment is being made by investors for whom such
Shareholder Servicing Agent maintains a servicing relationship. Shareholder
Servicing Agents fees amounted to $102,918, of which $38,595 was voluntarily
waived for the six months ended June 30, 1995.

(3) DISTRIBUTION FEE
The Trust has adopted a Plan of Distribution pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended, in which the Fund reimburses the
Distributor for expenses incurred or anticipated in connection with sales of
shares of the Fund, at an annual rate not to exceed 0.15% of the Fund's average
daily net assets. The Distributor may also receive an additional fee from the
Fund not to exceed 0.05% of the Fund's average daily net assets in anticipation
of, or as reimbursement for, advertising expenses incurred by the Distributor in
connection with the sale of shares of the Fund. No payment of such additional
fees has been made during the period. Under the Administrative Services Plan,
the distribution fees were computed at an annual rate of 0.05% of the Fund's
average daily net assets which amounted to $12,865, all of which was voluntarily
waived for the six months ended June 30, 1995.

(4) INVESTMENT TRANSACTIONS
Increases and decreases in the Fund's investment in the Portfolio for the six
months ended June 30, 1995 aggregated $2,229,902 and $8,311,939, respectively.
<PAGE>

(5) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in shares of beneficial interest were as follows:

Six Months
Ended Year
June 30, Ended
1995 December 31,
(unaudited) 1994
----------- -----------
Shares sold................. 231,095 2,047,894
Shares issued to
shareholders from rein-
vestment of dividends...... 132,435 333,897
Shares repurchased.......... (825,153) (4,683,580)
------- ----------
Net decrease................ (461,623) (2,301,789)
======== ===========

<PAGE>
--------------------------------------------------------------------------------
Government Income Portfolio
PORTFOLIO OF INVESTMENTS June 30, 1995 (unaudited)
--------------------------------------------------------------------------------

Principal
Amount
Issuer (000 omitted) Value
--------------------------------------------------------

GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION -- 4.2%

8.00%, 2006............. $347 $ 358,602
8.00%, 2007............. 284 292,759
8.00%, 2017............. 630 645,787
8.00%, 2021............. 292 299,219
8.00%, 2022............. 268 274,236
9.50%, 2016............. 4 3,901
9.50%, 2017............. 74 77,896
9.50%, 2018............. 87 92,036
9.50%, 2019............. 92 97,306
9.50%, 2020............. 84 89,056
-------
TOTAL GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION

(Identified Cost $2,189,405) 2,230,798
---------

Principal
Amount
Issuer (000 omitted) Value
-------------------------------------------------------

U.S. GOVERNMENT
OBLIGATIONS -- 94.5%

U.S. Treasury Notes,
4.625%, 2/15/1996...... $ 2,564 $ 2,546,770
5.125%, 3/31/1996...... 1,050 1,045,401
7.25%, 8/31/1996....... 8,250 8,380,185
6.125%, 5/31/1997...... 10,425 10,478,793
6.125%, 5/15/1998...... 9,730 9,793,829
5.375%, 5/31/1998...... 2,100 2,070,138
6.875%, 3/31/2000...... 9,640 9,977,400
6.25%, 5/31/2000....... 3,000 3,032,344
---------
47,324,860
----------
United States Treasury Bond
7.50%, 1/31/2000....... 3,420 3,654,065
----------
TOTAL U.S. GOVERNMENT OBLIGATIONS
(Identified Cost $50,959,225) 50,978,925
----------
TOTAL INVESTMENTS
(Identified Cost $53,148,630) 98.7% 53,209,723
OTHER ASSETS
LESS OTHER LIABILITIES.. 1.3 722,580
----- ----------
NET ASSETS............... 100.0% $53,932,303
===== ===========

See notes to financial statements
<PAGE>

--------------------------------------------------------------------------------
Government Income Portfolio
STATEMENT OF ASSETS AND LIABILITIES June 30, 1995 (unaudited)
--------------------------------------------------------------------------------

ASSETS:
Investments at value (Note 1A)
(Identified Cost, $53,148,630)....................... $53,209,723
Cash.................................................. 32,594
Interest receivable................................... 705,623
----------
Total assets...................................... 53,947,940
----------
LIABILITIES:
Payable to affiliates--Investment
advisory fee (Note 2)............................... 15,637
NET ASSETS ........................................... $53,932,303
==========
REPRESENTED BY:
Paid-in capital for beneficial interests.............. $53,932,303
==========

See notes to financial statements

--------------------------------------------------------------------------------
Government Income Portfolio
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 1995 (unaudited)
--------------------------------------------------------------------------------

INTEREST INCOME (Note 1B):............................ $1,659,774

EXPENSES:
Investment advisory fees (Note 2)..................... $ 94,818
Administrative fees (Note 3).......................... 13,545
Expense fees (Note 6)................................. 500
----------
Total expenses...................................... 108,863

Less aggregate amount waived by the Investment
Advisor and Administrator (Note 2 and Note 3)........ (7,164)
-----------
Net Expense........................................... 101,699
----------
Net investment income............................... 1,558,075
---------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS (Note 5):
Net realized gain from investment transactions........ 301,476
Unrealized appreciation (depreciation)
of investments--
Beginning of period................................ (2,077,668)
End of period...................................... 61,093
----------
Net change in unrealized
appreciation (depreciation)....................... 2,138,761
----------
Net realized and unrealized gain on investments.... 2,440,237
----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS...................................... $3,998,312
==========

See notes to financial statements

<PAGE>
--------------------------------------------------------------------------------
Government Income Portfolio
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the
Six Months May 1, 1994
Ended (Commencement
June 30, 1995 of Operations) to
(unaudited) December 31, 1994
------------- ----------------

<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS:
Net investment income...................................................$ 1,558,075 $ 2,240,079
Net realized gain on investment transactions.......................... 301,476 (2,084,009)
Net change in unrealized appreciation (depreciation) of investments.... 2,138,761 443,611
--------- ---------
Net increase (decrease) in net assets resulting from operations.... 3,998,312 599,681
--------- ---------
CAPITAL TRANSACTIONS:
Proceeds from contributions............................................ 2,785,166 80,362,853
Value of withdrawals................................................... (8,524,247) (25,289,462)
--------- ---------
Net increase (decrease) in net assets from capital transactions.... (5,739,081) 55,073,391
--------- ---------
NET INCREASE (DECREASE) IN NET ASSETS: ................................ (1,740,769) 55,673,072
NET ASSETS:
Beginning of period.................................................... 55,673,072 --
---------- -----------
End of period.......................................................... $53,932,303 $55,673,072
========== ==========
See notes to financial statements
</TABLE>

--------------------------------------------------------------------------------
Government Income Portfolio
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the For the Period
Six Months May 1, 1994
Ended (Commencement of
June 30, 1995 Operations) to
(unaudited) December 31, 1994
------------- ----------------
RATIOS/SUPPLEMENTAL DATA:
<S> <C> <C>
Net Assets, end of period (000 omitted)................................ $53,932 $55,673
Ratio of expenses to average net assets................................ 0.38%* 0.43%*
Ratio of net investment income to average net assets................... 5.75%* 5.27%*
Portfolio turnover..................................................... 113% 40%
<CAPTION>
Note: If Agents of the Portfolio had not voluntarily waived a portion of their fees during the period
indicated, the ratios would have been as follows:

RATIOS:
<S> <C> <C>
Expenses to average net assets......................................... 0.40%* 0.44%*
Net investment income to average net assets............................ 5.73%* 5.26%*
* Annualized
</TABLE>

See notes to financial statements
<PAGE>

--------------------------------------------------------------------------------
Government Income Portfolio
NOTES TO FINANCIAL STATEMENTS (unaudited)
--------------------------------------------------------------------------------

(1) SIGNIFICANT ACCOUNTING POLICIES
Government Income Portfolio (the "Portfolio"), a separate series of The Premium
Portfolios (the "Portfolio Trust"), is registered under the Investment Company
Act of 1940, as amended, as a diversified, open-end management investment
company which was organized as a trust under the laws of the State of New York.
The Declaration of Trust permits the Trustees to issue beneficial interests in
the Portfolio. The Investment Adviser of the Portfolio is Citibank, N.A.
("Citibank"). Signature Financial Group (Grand Cayman), Ltd. ("SFG") acts as the
Portfolio's Administrator.

The significant accounting policies consistently followed by the Portfolio are
in conformity with generally accepted accounting principles and are as follows:

A. INVESTMENT SECURITY VALUATIONS -- Debt securities (other than short-term
obligations maturing in 60 days or less) are valued on the basis of valuations
furnished by pricing services, which take into account appropriate factors such
as institutional-size trading in similar groups of securities, yield, quality,
coupon rate, maturity, type of issue, and other market data, without exclusive
reliance on quoted prices or exchange or over-the counter prices, since such
valuations are believed to reflect more accurately the fair value of the
securities. Short-term obligations maturing in 60 days or less are valued at
amortized cost, which approximates market value. Securities, if any, for which
there are no such valuations or quotations are valued at fair value as
determined in good faith by or under guidelines established by the Trustees.

B. INCOME -- Interest income consists of interest accrued and discount earned,
adjusted for amortization of premium or discount on long-term debt securities
when required for U.S. federal income tax purposes. Gain and loss from principal
paydowns are recorded as ordinary income.

C. U.S. FEDERAL INCOME TAXES -- The Portfolio is considered a partnership under
the U.S. Internal Revenue Code. Accordingly, no provision for federal income
taxes is necessary.

D. EXPENSES -- The Portfolio bears all costs of its operations other than
expenses specifically assumed by Citibank and SFG. Expenses incurred by the
Portfolio Trust with respect to any two or more portfolios or series are
allocated in proportion to the average net assets of each portfolio, except when
allocations of direct expenses to each portfolio can otherwise be made fairly.
Expenses directly attributable to a portfolio are charged to that portfolio.

E. OTHER -- Investment transactions are accounted for on the date the
investments are purchased or sold. Realized gains and losses are determined on
the identified cost basis.

(2) INVESTMENT ADVISORY FEES
The investment advisory fee paid to Citibank, as compensation for overall
investment management services, amounted to $94,818, of which $945 was
voluntarily waived for the six months ended June 30, 1995. The investment
advisory fee is computed at the annual rate of 0.35% of the Portfolio's average
daily net assets.

(3) ADMINISTRATIVE FEE
Under the terms of an Administrative Services Agreement, the administrative fee
paid to the Administrator, as compensation for overall administrative services
and general office facilities, is computed at the annual rate of 0.05% of the
Portfolio's average daily net assets. The administrative fee amounted to $13,545
of which $6,219 was voluntarily waived, for the six months ended June 30, 1995.
Citibank acts as Sub-Administrator and performs such duties and receives such
compensation from SFG as from time to time is agreed to by SFG and Citibank. The
Portfolio pays no compensation directly to any Trustee or any officer who is
affiliated with the Administrator, all of whom receive remuneration for their
services to the Portfolio from the Administrator or its affiliates. Certain of
the officers and a Trustee of the Portfolio are officers or directors of the
Administrator or its affiliates.
<PAGE>

(4) PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of U.S. Government securities, other than short-term
obligations, aggregated $59,367,434 and $62,869,456, respectively, for the six
months ended June 30, 1995.

(5) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation (depreciation) in value of the investment
securities owned at June 30, 1995, as computed on a federal income tax basis,
are as follows:

Aggregate cost...................... $ 53,148,630
==============

Gross unrealized appreciation....... $ 456,832
Gross unrealized depreciation....... (395,739)
--------------
Net unrealized depreciation......... $ 61,093
==============

(6) EXPENSE FEE
SFG has entered into an expense agreement with the Portfolio. SFG has agreed to
pay all of the ordinary operating expenses (excluding interest, taxes, brokerage
commissions, litigation costs or other extraordinary costs or expenses) of the
Portfolio, other than fees paid under the Advisory Agreement and Administrative
Services Agreement. The Agreement may be terminated by either party upon not
less than 30 days nor more than 60 days written notice.

The Portfolio has agreed to pay SFG an expense fee on an annual basis, accrued
daily and paid monthly; provided, however, that such fee shall not exceed the
amount such that immediately after any such payment the aggregate ordinary
expenses of the Portfolio would, on an annual basis, exceed an agreed upon rate,
currently 0.45% of the Portfolio's average daily net assets.

(7) LINE OF CREDIT
The Portfolio, along with other Landmark Funds entered into an ongoing agreement
with a bank which allows the Funds collectively to borrow up to $40 million for
temporary or emergency purposes. Interest on borrowings, if any, is charged to
the specific fund executing the borrowing at the base rate of the bank. In
addition, the $15 million committed portion of the line of credit requires a
quarterly payment of a commitment fee based on the average daily unused portion
of the line of credit. For the six months ended June 30, 1995 the commitment fee
allocated to the Portfolio was $221. Since the line of credit was established,
there have been no borrowings.
<PAGE>

--------------------------------------------------------------------------------
SHAREHOLDER
SERVICING AGENTS
--------------------------------------------------------------------------------

FOR CITIBANK NEW YORK RETAIL BANKING AND
BUSINESS AND PROFESSIONAL CUSTOMERS:
Citibank, N.A.
450 West 33rd Street, New York, NY 10001
(212) 564-3456 or (800) 846-5300

FOR CITIGOLD CUSTOMERS:
Citibank, N.A.
Citigold
P.O. Box 5130, New York, NY 10126-5130
Call Your Citigold Executive or, in NY or CT, (800) 285-1701,
For all other States, (800) 285-1707

FOR PRIVATE BANKING CLIENTS:
Citibank, N.A.
The Citibank Private Bank
153 East 53rd Street, New York, NY 10043
Call Your Citibank Private Banking Account Officer,
Investment Specialist or (212) 559-5959

FOR CITIBANK GLOBAL ASSET MANAGEMENT CLIENTS:
Citibank, N.A.
Citibank Global Asset Management
153 East 53rd Street, New York, NY 10043
(212) 559-7117

FOR NORTH AMERICAN INVESTOR SERVICES CLIENTS:
Citibank, N.A.
111 Wall Street, New York, NY 10043
Call Your Account Manager or (212) 657-9100

FOR CITICORP INVESTMENT SERVICES CUSTOMERS:
Citicorp Investment Services
One Court Square, Long Island City, NY 11120
Call Your Investment Consultant or (800) 846-5200
(212) 736-8170 in New York City
<PAGE>

TRUSTEES AND OFFICERS
Philip W. Coolidge*, President
H. B. Alvord
Riley C. Gilley
Diana R. Harrington
Susan B. Kerley
C. Oscar Morong, Jr.
Donald B. Otis
E. Kirby Warren
William S. Woods, Jr.

SECRETARY AND TREASURER
James B. Craver*

ASSISTANT TREASURER
Barbara M. O'Dette*

ASSISTANT SECRETARIES
Susan Jakuboski*
Molly S. Mugler*
*Affiliated Person of Administrator and Distributor

---------------------------------------------------

INVESTMENT ADVISER
(OF GOVERNMENT INCOME
PORTFOLIO)
Citibank, N.A.
153 East 53rd Street, New York, NY 10043

ADMINISTRATOR AND DISTRIBUTOR
The Landmark Funds Broker-Dealer Services, Inc.
6 St. James Avenue, Boston, MA 02116
(617) 423-1679

TRANSFER AGENT
State Street Bank and Trust Company
225 Franklin Street, Boston, MA 02110

CUSTODIAN
Investors Bank and Trust Company
One Lincoln Plaza, Boston, MA 02111

AUDITORS
Price Waterhouse LLP
160 Federal Street, Boston, MA 02110

LEGAL COUNSEL
Bingham, Dana & Gould
150 Federal Street, Boston, MA 02110

---------------------------------------------------

SHAREHOLDER SERVICING AGENTS
(See Inside Cover)

This report is prepared for the information of shareholders. It is authorized
for distribution to prospective investors only when preceded or accompanied by
an effective prospectus.

This Report is Prepared & Printed on Recycled Paper [LOGO]
FI/USG/S/95

<PAGE>
[LOGO] LANDMARK(SM) FUNDS
Advised by Citibank, N.A.

LANDMARK
INTERMEDIATE
INCOME FUND

SEMI-ANNUAL
REPORT
June 30, 1995

<PAGE>

--------------------------------------------------------------------------------
A LETTER TO OUR SHAREHOLDERS
--------------------------------------------------------------------------------

Dear Shareholder:

The first six months of 1995 saw higher prices for most financial assets,
including the fixed-income securities in which the Landmark Intermediate Income
Fund primarily invests. In fact, bonds have rallied significantly since the
beginning of the year, erasing any declines posted in 1994.

The Landmark Funds' investment adviser, Citibank, N.A., manages the
Landmark Intermediate Income Fund to generate a high level of current income
with consideration also given to safety of principal. The Fund seeks to provide
an attractive yield from a high quality investment portfolio consisting
primarily of intermediate-term securities from a number of fixed-income market
sectors.

/s/ Philip W. Coolidge

Philip W. Coolidge
President
July 20, 1995

Remember that Mutual Fund Shares:
o Are not bank deposits or FDIC insured
o Are not obligations of or guaranteed by Citibank or Citicorp Investment
Services
o Are subject to investment risks, including possible loss of the principal
amount invested.

<PAGE>

TABLE OF CONTENTS
1 Letter to Shareholders
-------------------------------------------
2 Market Environment
Fund Snapshot
-------------------------------------------
3 Portfolio Manager
The Portfolio Manager Responds
Fund Quotes
-------------------------------------------
4 Strategy and Outlook
Landmark Intermediate
Income Fund--by the Numbers
-------------------------------------------
5 Fund Data
Performance Highlights
-------------------------------------------
6 Portfolio of Investments
-------------------------------------------
8 Statement of Assets and Liabilities
-------------------------------------------
9 Statement of Operations
-------------------------------------------
10 Statement of Changes in Net Assets
-------------------------------------------
11 Financial Highlights
-------------------------------------------
12 Notes to Financial Statements

<PAGE>
--------------------------------------------------------------------------------
MARKET ENVIRONMENT
--------------------------------------------------------------------------------

Slower economic growth seems to be the primary reason for the bond market's
excellent performance after a disappointing 1994. Fixed-income investors appear
to be convinced that the Federal Reserve has been largely successful in its
efforts to constrain economic growth without causing either a recession or an
acceleration of inflation. Recent economic data suggest that the U.S. is
experiencing a "soft landing" after 1994's torrid pace of economic growth, a
state of affairs that raises expectations for continued economic expansion with
low inflation and, perhaps most important, no need for the Federal Reserve to
raise short-term interest rates further. Periods of low inflation tend to
benefit the bond market as investors worry less that rising prices will erode
the purchasing power of their principal and income over time.

--------------------------------------------------------------------------------
FUND SNAPSHOT
--------------------------------------------------------------------------------

COMMENCEMENT OF OPERATIONS
June 25, 1993

NET ASSETS AS OF 6/30/95
$49.9 million

FUND OBJECTIVE
To generate a high level of current income and preserve the value of its
shareholders' investments

DIVIDENDS
Paid monthly

CAPITAL GAINS
Distributed annually, if any

BENCHMARKS
o Lehman Government/Corporate Bond Index
o Lipper Intermediate Investment Grade Funds Average

INVESTMENT ADVISER
Citibank, N.A.

<PAGE>
--------------------------------------------------------------------------------
PORTFOLIO MANAGER
--------------------------------------------------------------------------------

MARK LINDBLOOM
Vice President, Citibank, N.A.

Mr. Lindbloom has been responsible for managing the Landmark Intermediate Income
Fund since its inception in June 1993. He also manages the fixed income portion
of the Balanced Portfolio and intermediate maturity fixed income portfolios for
investment advisory and institutional accounts at Citibank. Prior to joining
Citibank in 1986, Mr. Lindbloom was employed by Brown Brothers Harriman
& Company, where he managed discretionary corporate portfolios, holding fixed
income assets.

--------------------------------------------------------------------------------
THE PORTFOLIO MANAGER RESPONDS
--------------------------------------------------------------------------------

In the wake of last year's severe bond market declines, we maintained a
longer-than-average duration (a measure of sensitivity to changes in interest
rates) in order to keep higher-yielding securities in the Portfolio for as long
as possible. In our view, bond prices had declined farther than economic and
market conditions warranted, and we expected a rebound as inflation fears
abated. This stance put us in a good position not just to take advantage of the
market's overreaction to inflation fears, but also to capture further gains as
interest rates continued to fall.

Consistent with our sector rotation strategy, we decreased the percentage
of assets invested in U.S. Treasury securities during the period from 48% of the
portfolio on January 1 to 40% of the portfolio on June 30. Simultaneously, we
reduced our exposure to mortgage-backed securities and corporate bonds as the
differences in yields among the different types of securities narrowed. In our
view, mortgages and corporates no longer offered sufficient incremental returns
to justify their risks relative to federally backed U.S.
Treasury securities.

"We've seen a tremendous rally in the bond market during the first six months of
this year, including the maturity range in which the Fund invests."

"As it became obvious that the economy was slowing, fixed-income investors
became convinced that inflation wouldn't be the problem they feared it would be
last year."

"Through March, mortgage and corporate securities performed better than U.S.
Treasury securities. The reverse was generally true in the second quarter,
particularly with respect to mortgages."

--------------------------------------------------------------------------------
STRATEGY AND OUTLOOK
--------------------------------------------------------------------------------

In the wake of the substantial gains achieved during the first half of the
year, we are maintaining a more cautious approach to the bond market. We have
reduced the portfolio's average duration from the long end to just short of
neutral, reflecting our belief that the market has fully incorporated a "soft
landing" economic scenario and may decline modestly from here.

While a market correction is possible over the near term if the economy
strengthens, our outlook calls for a true deceleration of economic growth over
the longer term. If the economy does moderate further, the Federal Reserve may
lower interest rates, a move that should boost bond prices. Therefore, we will
view any near-term market correction as a buying opportunity in order to
participate in the attractive fixed-income returns we believe are ahead.

--------------------------------------------------------------------------------
Landmark Intermediate Income Fund
--------------------------------------------------------------------------------
BY THE NUMBERS

CHANGES IN PORTFOLIO COMPOSITION
Portfolio of Investments
as of 6/30/95
[Graphics Omitted: pie charts]

Cash/Short Term/Other ..................... 7%
Asset Backed Securities ................... 20%
Mortgage Obligations ...................... 24%
Corporate Bonds ........................... 5%
Yankees ................................... 4%
U.S. Treasury Issues ...................... 40%

Compared to 12/31/94

Cash/Short Term/Other ..................... (9)%
Asset Backed Securities ................... 19%
Mortgage Obligations ...................... 29%
Corporate Bonds ........................... 9%
Yankees ................................... 4%
U.S. Treasury Issues ...................... 48%

<PAGE>

--------------------------------------------------------------------------------
FUND DATA all periods ending June 30, 1995 (unaudited)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TOTAL RETURNS
------------------------------------------
SIX MONTHS SINCE
ENDED ONE 6/25/93
JUNE 30, 1995<F1> YEAR (INCEPTION)<F2>
--------------- ----- ------------
<S> <C> <C> <C>
Landmark Intermediate Income Fund without Sales Charge........... 11.73% 12.05% 4.81%
Lipper Intermediate Investment Grade Funds Average............... 10.22% 10.91% 4.49%<F3>
Lehman Government/Corporate Bond Index........................... 11.80% 12.76% 4.53%<F3>
Landmark Intermediate Income Fund with Maximum Sales Charge
of 4.00% ...................................................... 7.27% 7.57% 2.70%
<F1> Not Annualized
<F2> Annualized
<F3> From 6/30/93
</TABLE>

30-Day SEC Yield 5.73%
Income Dividends Per Share $0.270

--------------------------------------------------------------------------------
PERFORMANCE HIGHLIGHTS
--------------------------------------------------------------------------------

A $10,000 investment in the Fund made on inception date would have grown to
$10,551 with sales charge (as of 6/30/95). The graph shows how this compares to
our benchmarks over the same period.

Landmark Landmark Lipper Lehman
Intermediate Intermediate Intermediate Government
Income - Income- Investment Corporate
Without With Grade Bond
Sales Sales Funds Index
Charge Charge Average (Unmanaged)

May-93 $10,000 $ 9,600 $10,000 $10,000
Jun-93 $10,030 $ 9,629 $10,000 $10,000
Jul-93 $10,073 $ 9,670 $10,042 $10,064
Aug-93 $10,325 $ 9,912 $10,228 $10,295
Sep-93 $10,405 $ 9,989 $10,268 $10,332
Oct-93 $10,416 $ 9,999 $10,301 $10,374
Nov-93 $10,246 $ 9,836 $10,209 $10,251
Dec-93 $10,298 $ 9,886 $10,257 $10,295
Jan-94 $10,444 $10,026 $10,387 $10,451
Feb-94 $10,214 $ 9,805 $10,202 $10,223
Mar-94 $ 9,967 $ 9,569 $ 9,980 $ 9,973
Apr-94 $ 9,867 $ 9,472 $ 9,890 $ 9,890
May-94 $ 9,840 $ 9,447 $ 9,875 $ 9,871
Jun-94 $ 9,809 $ 9,417 $ 9,856 $ 9,847
Jul-94 $ 9,975 $ 9,576 $10,004 $10,044
Aug-94 $10,003 $ 9,602 $10,024 $10,048
Sep-94 $ 9,835 $ 9,442 $ 9,911 $ 9,897
Oct-94 $ 9,797 $ 9,405 $ 9,896 $ 9,886
Nov-94 $ 9,759 $ 9,369 $ 9,867 $ 9,709
Dec-94 $ 9,837 $ 9,444 $ 9,915 $ 9,773
Jan-95 $10,020 $ 9,619 $10,072 $ 9,960
Feb-95 $10,248 $ 9,838 $10,282 $10,191
Mar-95 $10,321 $ 9,908 $10,346 $10,260
Apr-95 $10,438 $10,021 $10,479 $10,403
May-95 $10,929 $10,492 $10,849 $10,839
Jun-95 $10,991 $10,551 $10,917 $10,926

Notes: All Fund performance numbers represent past performance, and are no
guarantee of future results. The Fund's share price and investment return will
fluctuate, so that the value of an investor's shares, when redeemed, may be
worth more or less than their original cost. Total returns include change in
share price and reinvestment of dividends and distributions, if any. Total
return figures "with sales charge' are provided in accordance with SEC
guidelines for comparative purposes for prospective investors.

<PAGE>
--------------------------------------------------------------------------------
Landmark Intermediate Income Fund
PORTFOLIO OF INVESTMENTS JUNE 30, 1995 (UNAUDITED)
--------------------------------------------------------------------------------
PRINCIPAL
AMOUNT
ISSUER (000 OMITTED) VALUE
--------------------------------------------------------------------------------
FIXED INCOME--92.4%
--------------------------------------------------------------------------------

ASSET BACKED SECURITIES-19.6%
Contimortgage Home Equity Loan
7.95% due 4/15/10...................... $1,700 $1,753,227
EQCC Home Equity Loan Trust
8.95% due 10/15/06..................... 2,000 2,095,625
First USA Credit Card
6.265% due 10/15/01.................... 2,000 1,997,500
General Motors Acceptance Corp.
5.95% due 2/15/97...................... 32 31,796
GMAC 1992 E Grantor Trust
4.75% due 8/15/97...................... 187 185,053
Household Finance
6.625% due 5/20/08..................... 2,000 2,008,120
United Companies Financial Corp.
7.25% due 12/10/20..................... 1,700 1,693,625
-----------
9,764,946
-----------

MORTGAGE OBLIGATIONS-23.7%
COLLATERALIZED MORTGAGE OBLIGATIONS - 18.6%
Federal Home Loan Mortgage Corp.
6.50% due 11/15/21..................... 2,000 1,902,500
Federal National Mortgage Association
5.00% due 11/25/21..................... 1,000 813,430
Nomura Securities
7.328% due 7/7/03...................... 1,331 1,360,533
8.15% due 4/4/27....................... 2,000 2,163,125
Resolution Trust Corp.
6.675% due 6/25/26..................... 1,898 1,898,357
Structured Asset Securities Corp.
7.375% due 9/25/24..................... 1,167 1,166,984
-----------
9,304,929
-----------
MORTGAGE BACKED SECURITIES-0.2%
Federal Home Loan Mortgage Association
8.50% due 4/01/01...................... 52 53,856
Federal National Mortgage Association
8.00% due 6/01/02...................... 26 27,010
-----------
80,866
-----------

GOVERNMENT NATIONAL MORTGAGE ASSOCIATION-4.9%
7.00% due 5/20/25...................... 1,568 1,594,704
8.00% due 12/15/07..................... 142 147,034
8.25% due 7/15/05...................... 698 713,309
-----------
2,455,047
-----------

TOTAL MORTGAGE OBLIGATIONS 11,840,842
-----------

DOMESTIC CORPORATE BONDS-5.2%
Kmart Corp.
8.125% due 12/1/06..................... 2,000 2,062,040
12.50% due 3/1/05...................... 400 533,664
-----------
2,595,704
-----------

YANKEES-3.6%
Midland Bank, PLC
7.65% due 5/1/25....................... 1,700 1,796,951
-----------

UNITED STATES GOVERNMENT
OBLIGATIONS-40.3%

UNITED STATES GOVERNMENT AGENCIES-2.0%
Federal Home Loan Banks
8.00% due 4/19/00...................... 1,000 1,005,940
-----------
UNITED STATES TREASURY BONDS-9.1%
7.625% due 2/15/25..................... 4,000 4,517,480
-----------

UNITED STATES TREASURY NOTES-29.2%
4.00% due 1/31/96...................... $ 125 $ 123,789
6.25% due 5/31/00...................... 10,000 10,106,200
7.50% due 2/15/05...................... 4,000 4,355,640
-----------
14,585,629
-----------

TOTAL UNITED STATES
GOVERNMENT OBLIGATIONS 20,109,049
-----------

TOTAL FIXED INCOME
(Identified Cost $45,385,322).......... 46,107,492
-----------

SHORT TERM OBLIGATIONS--6.8%

Repurchase Agreement, Chase
Manhattan 6.125% due 7/3/95,
proceeds at maturity $3,392,731
(secured by $3,437,400 U.S.
Treasury Note 6.125% due 7/31/96) ..... $ 3,391,000
-----------

TOTAL INVESTMENTS
(Identified Cost $48,776,322). 99.2% 49,498,492
OTHER ASSETS, LESS OTHER
LIABILITIES................... 0.8 386,971
----- -----------
NET ASSETS..................... 100.0% $49,885,463
===== ===========
See notes to financial statements
<PAGE>

Landmark Intermediate Income Fund
STATEMENT OF ASSETS AND LIABILITIES June 30, 1995 (unaudited)

ASSETS:
Investments, at value (Note 1A)
(Identified Cost, $48,776,322)............................... $49,498,492
Interest receivable........................................... 467,805
-----------
Total assets................................................ 49,966,297
-----------

LIABILITIES:
Payable for shares of beneficial interest repurchased......... 26,942
Payable to affiliates:
Shareholder Servicing Agents' fee (Note 3B)................. 10,299
Accrued expenses and other liabilities........................ 43,593
-----------
Total liabilities........................................... 80,834
-----------

NET ASSETS for 5,157,074 shares of beneficial
interest outstanding......................................... $49,885,463
===========

NET ASSETS CONSIST OF:
Paid-in capital............................................... $51,729,764
Accumulated net realized loss on investments.................. (2,708,806)
Unrealized appreciation of investments........................ 722,170
Undistributed net investment income........................... 142,335
-----------
Total....................................................... $49,885,463
===========

NET ASSET VALUE AND REDEMPTION PRICE PER SHARE
OF BENEFICIAL INTEREST....................................... $ 9.67
======

COMPUTATION OF OFFERING PRICE:
Maximum Offering Price per share based on a
4.00% sales charge ($9.67 / 0.96)............................ $10.07
======

See notes to financial statements
<PAGE>
Landmark Intermediate Income Fund
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 1995 (unaudited)

INVESTMENT INCOME (Note 1B)......................... $1,736,093

EXPENSES:
Shareholder servicing agents' fees (Note 3B)........ $96,160
Investment advisory fees (Note 2)................... 84,139
Administrative fees (Note 3A)....................... 48,080
Shareholder reports................................. 30,905
Custodian fees...................................... 30,250
Auditing services................................... 19,700
Legal services...................................... 12,332
Distribution fees (Note 4).......................... 12,010
Trustees fees....................................... 8,787
Transfer agent fees................................. 6,000
Miscellaneous....................................... 4,598
-------
Total expenses.................................... 352,961
Less aggregate amount waived by Investment
Adviser, Administrator, Shareholder Servicing
Agents and Distributor (Notes 2, 3A, 3B, and 4).... (134,153)
--------
Net expenses...................................... 218,808
---------
Net investment income............................. 1,517,285
---------

NET REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS:
Net realized gain from investment transactions...... 2,055,015
Unrealized appreciation (depreciation)
of investments:
Beginning of period............................... (1,108,185)
End of period..................................... 722,170
---------
Net change in unrealized appreciation
(depreciation) of investments...................... 1,830,355
---------
Net realized and unrealized gain
(loss) on investments............................... 3,885,370
---------
Net Increase in Net Assets Resulting
from Operations.................................... $5,402,655
==========

See notes to financial statements
<PAGE>

Landmark Intermediate Income Fund
STATEMENT OF CHANGES IN NET ASSETS

SIX MONTHS ENDED
JUNE 30, 1995 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1994
------------ -----------------
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS:
Net investment income........................ $ 1,517,285 $ 2,940,876
Net realized gain (loss) from
investment transactions..................... 2,055,015 (4,798,890)
Net change in unrealized appreciation
(depreciation) of investments................ 1,830,355 (730,406)
---------- ----------
Net increase (decrease) in net assets
resulting from operations....... 5,402,655 (2,588,420)
---------- ----------

DISTRIBUTIONS DECLARED TO SHAREHOLDERS FROM:
Net investment income........................ (1,403,050) (2,912,776)
Net realized gain on investments............. -- (90,585)
---------- ----------
Decrease in net assets from
distributions declared to shareholders.... (1,403,050) (3,003,361)
---------- ----------

TRANSACTIONS IN SHARES OF BENEFICIAL
INTEREST (Note 6):
Net proceeds from sale of shares............. 436,462 1,241,851
Net asset value of shares issued to
shareholders from reinvestment
of distributions........................... 1,386,488 2,973,424
Cost of shares repurchased................... (3,518,769) (12,224,541)
---------- ----------
Net decrease in net assets from
transactions in shares of
beneficial interest (1,695,819) (8,009,266)
---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS ....... 2,303,786 (13,601,047)

NET ASSETS:
Beginning of period.......................... 47,581,677 61,182,724
---------- ----------
End of period (including undistributed
net investment income of $142,335 and
$28,100, respectively)...................... $49,885,463 $47,581,677
========== ==========

See notes to financial statements
<PAGE>

Landmark Intermediate Income Fund
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE PERIOD
JUNE 25, 1993
SIX MONTHS ENDED (COMMENCEMENT OF
JUNE 30, 1995 YEAR ENDED OPERATIONS) TO
(UNAUDITED) DECEMBER 31, 1994 DECEMBER 31, 1993
----------- ---------------- ----------------
<S> <C> <C> <C>
Net Asset Value, beginning of period........... $ 8.91 $ 9.88 $10.00
----- ----- -----
Income From Operations:
Net investment income.......................... 0.298 0.521 0.261
Net realized and unrealized gain
(loss) on investments ......................... 0.732 (0.959) 0.037
----- ----- -----
Total from operations........................ 1.030 (0.438) 0.298
----- ----- -----
Less Distributions From:
Net investment income......................... (0.270) (0.516) (0.261)
In excess of net investment income............ -- -- (0.006)
Net realized gain on investments.............. -- (0.016) (0.151)
----- ----- -----
Total distributions.......................... (0.270) (0.532) (0.418)
----- ----- -----
Net Asset Value, end of period................. $ 9.67 $ 8.91 $ 9.88
===== ====== ======

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's omitted)...... $49,885 $47,582 $61,183
Ratio of expenses to average net assets........ 0.90%* 0.90% 0.90%*
Ratio of net investment income to average net assets 6.31%* 5.52% 4.95%*
Portfolio turnover............................. 2.66% 291% 103%
Total return................................... 11.73%+ (4.48)% 2.99%+

Note: If Agents of the Fund had not voluntarily agreed to waive a portion of their fees for the
periods indicated, the net investment income per share and the ratios would have been as follows:

Net investment income per share................ $0.271 $0.475 $0.236
Ratios:
Expenses to average net assets................. 1.47%* 1.39% 1.38%*
Net investment income to average net assets.... 5.74%* 5.03% 4.47%*

*Annualized
+Not annualized

See notes to financial statements
</TABLE>
<PAGE>

Landmark Intermediate Income Fund
NOTES TO FINANCIAL STATEMENTS (unaudited)

(1) SIGNIFICANT ACCOUNTING POLICIES
Landmark Intermediate Income Fund (the "Fund") is a separate diversified series
of Landmark Fixed Income Funds (the "Trust") which is organized as a
Massachusetts business trust and is registered under the Investment Company Act
of 1940, as amended, as an open-end, management investment company. The
Investment Adviser of the Fund is Citibank, N.A. ("Citibank"). The Landmark
Funds Broker-Dealer Services, Inc. ("LFBDS") acts as the Fund's Administrator
and Distributor. Citibank also serves as Sub-Administrator and makes Fund shares
available to customers as Shareholder Servicing Agent.

The significant accounting policies consistently followed by the Fund are in
conformity with generally accepted accounting principles and are as follows:

A. INVESTMENT SECURITY VALUATIONS -- Debt securities (other than short-term
obligations maturing in 60 days or less) are valued on the basis of valuations
furnished by a pricing service, which take into account appropriate factors such
as institutional-size trading in similar groups of securities, yield, quality,
coupon rate, maturity, type of issue, and other market data, without exclusive
reliance upon quoted prices or exchange or over-the-counter prices, since such
valuations are believed to reflect more accurately the fair value of the
securities. Short-term obligations (maturing in 60 days or less) are valued at
amortized cost, which approximates market value. Securities, if any, for which
there are no such valuations or quotations are valued at fair value as
determined in good faith by or under guidelines established by the Trustees.

B. INCOME -- Interest income is determined on the basis of interest accrued and
discount earned, adjusted for amortization of premium or discount on long-term
debt securities when required for Federal income tax purposes. Gain and loss
from principal paydowns are recorded as ordinary income.

C. FEDERAL TAXES -- The Fund's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders all of its taxable income, including any net realized
gain on investment transactions. Accordingly, no provision for federal income or
excise tax is necessary. At December 31, 1994, the Fund, for federal income tax
purposes, had a capital loss carryover of $3,231,735, which will expire December
31, 2002. Such capital loss carryover will reduce the Fund's taxable income
arising from future net realized gain on investment transactions, if any, to the
extent permitted by the Internal Revenue Code, and thus will reduce the amount
of the distributions to shareholders which would otherwise by necessary to
relieve the Fund of any liability for federal income or excise tax.

E. DISTRIBUTIONS -- The Fund distinguishes between distributions on a tax basis
and a financial reporting basis and requires that only distributions in excess
of tax basis earnings and profits be reported in the financial statements as a
return of capital. Differences in the recognition or classification of income
between the financial statements and tax earnings and profits which result in
temporary over-distributions for financial statement purposes, are classified as
distributions in excess of net investment income or accumulated net realized
gains.

F. OTHER -- Investment transactions are accounted for on the date the
investments are purchased or sold. Realized gains and losses are determined on
the identified cost basis. Distributions to shareholders and shares issuable to
shareholders electing to receive distributions in shares are recorded on the
ex-dividend date.

(2) INVESTMENT ADVISORY FEES
The investment advisory fee paid to Citibank, as compensation for overall
investment management services amounted to $84,139, of which $62,003 was
voluntarily waived for the six months ended June 30, 1995. The investment
advisory fee is computed at the annual rate of 0.35% of average daily net
assets.

(3) ADMINISTRATIVE SERVICES PLAN
The Trust has adopted an Administrative Services Plan (the "Administrative
Services Plan") which provides that the Trust on behalf of the Fund may obtain
the services of an Administrator, one or more Shareholder Servicing Agents and
other Servicing Agents, and may enter into agreements providing for the payment
of fees for such services. Under the Administrative Services Plan, the aggregate
of the fee paid to the Administrator from the Fund, the fees paid to the
Shareholder Servicing Agents from the Fund under such Plan and the Basic
Distribution Fee paid from the Fund to the Distributor under the Distribution
Plan may not exceed 0.65% of the Fund's average daily net assets on an
annualized basis for the Fund's then current fiscal year.

A. ADMINISTRATIVE FEES -- Under the terms of an Administrative Services
Agreement, the administrative services fee payable to the Administrator, as
compensation for overall administrative services and general office facilities,
is computed at an annual rate of 0.25% of the Fund's average daily net assets,
provided that the aggregate of any such fees paid to the Administrator and the
basic distribution fees paid to the Distributor may not exceed an amount equal
to 0.25% of the Fund's average daily net assets. The Administrator received
fees, computed at an annual rate of 0.20% of the Fund's average daily net assets
which amounted to $48,080, of which $24,080 was voluntarily waived for the six
months ended June 30, 1995. Citibank acts as Sub-Administrator and performs such
duties and receives such compensation from LFBDS as from time to time is agreed
to by LFBDS and Citibank. The Fund pays no compensation directly to any Trustee
or any officer who is affiliated with the Administrator, all of whom receive
remuneration for their services to the Fund from the Administrator or its
affiliates. Certain of the officers and a Trustee of the Fund are officers or
directors of the Administrator or its affiliates.

B. SHAREHOLDER SERVICING AGENTS FEES -- The Fund has entered into shareholder
servicing agreements with each Shareholder Servicing Agent pursuant to which the
Shareholder Servicing Agent acts as an agent for its customers and provides
other related services. For their services, each Shareholder Servicing Agent
receives fees from the Fund, which may be paid periodically, which may not
exceed, on an annualized basis, an amount equal to 0.40% of the average daily
net assets of the Fund represented by shares owned during the period by
investors for whom such Shareholder Servicing Agent maintains a servicing
relationship. Shareholder Servicing Agents' fees amounted to $96,160, of which
$36,060 was voluntarily waived for the six months ended June 30, 1995.

(4) DISTRIBUTION FEES
The Fund has adopted a Plan of Distribution pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended, under which the Fund reimburses the
Distributor for expenses incurred or anticipated in connection with sale of
shares of the Fund, at an annual rate not to exceed 0.15% of the Fund's average
daily net assets for distribution of the Fund's shares. The Distributor may also
receive an additional fee from the Fund not to exceed 0.05% of the Fund's
average daily net assets in anticipation of, or as reimbursement for,
advertising expenses incurred by the Distributor in connection with the sale of
shares of the Fund. No payment of such additional fees has been made during the
period. Under the Administrative Services Plan, the distribution fees were
computed at an annual rate of 0.05% of the Fund's average daily net assets,
which amounted to $12,010, all of which was voluntarily waived for the six
months ended June 30, 1995.

(5) PURCHASES AND SALES OF INVESTMENTS
Purchases and sales of securities, other than short-term obligations, aggregated
$130,604,088 and $139,933,410, respectfully, for the six months ended June 30,
1995.

(6) SHARES OF BENEFICIAL INTEREST
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in shares of beneficial interest were as follows:

<PAGE>
SIX MONTHS ENDED
JUNE 30, 1995 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1994
----------------- -----------------
Shares sold 46,337 129,167
Shares issued to shareholders from
reinvestment of distributions 149,460 322,052
Shares repurchased (381,002) (1,304,223)
-------- ---------
Net decrease (185,205) (853,004)
======== =========

(7) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation (depreciation) in value of the investment
securities owned at June 30, 1995, as computed on a federal income tax basis,
are as follows:

Aggregate cost $48,776,322
===========
Gross unrealized appreciation $ 797,873
Gross unrealized depreciation (75,703)
-----------
Net unrealized appreciation $ 722,170
===========

(8) LINE OF CREDIT
The Fund, along with other Landmark Funds entered into an ongoing agreement with
a bank which allows the Funds collectively to borrow up to $40 million for
temporary or emergency purposes. Interest on borrowings, if any, is charged to
the specific fund executing the borrowing at the base rate of the bank. In
addition, the $15 million committed portion of the line of credit requires a
quarterly payment of a commitment fee based on the average daily unused portion
of the line of credit. For the six months ended June 30, 1995, the commitment
fee allocated to the Fund was $191. Since the line of credit was established
there have been no borrowings.
<PAGE>

--------------------------------------------------------------------------------
SHAREHOLDER SERVICING AGENTS
--------------------------------------------------------------------------------

FOR CITIBANK NEW YORK RETAIL BANKING AND
BUSINESS AND PROFESSIONAL CUSTOMERS:
Citibank, N.A.
450 West 33rd Street, New York, NY 10001
(212) 564-3456 or (800) 846-5300

FOR CITIGOLD CUSTOMERS:
Citibank, N.A.
Citigold
P.O. Box 5130, New York, NY 10126-5130
Call Your Citigold Executive or, in NY or CT (800) 285-1701,
or for all other states (800) 285-1707

FOR CITIBANK GLOBAL ASSET MANAGEMENT CLIENTS:
Citibank, N.A.
Citibank Global Asset Management
153 East 53rd Street, New York, NY 10043
(212) 559-7117

FOR NORTH AMERICAN INVESTOR SERVICES CLIENTS:
Citibank, N.A.
111 Wall Street, New York, NY 10043
Call Your Account Manager or (212) 657-9100

FOR CITICORP INVESTMENT SERVICES CUSTOMERS:
Citicorp Investment Services
One Court Square, Long Island City, NY 11120
Call Your Investment Consultant or (800) 846-5200
(212) 736-8170 in New York City

[LOGO] LANDMARK FUNDS

MONEY MARKET FUNDS:
Cash Reserves
Premium Liquid Reserves
Institutional Liquid Reserves

U.S. Treasury Reserves
Premium U.S. Treasury Reserves
Institutional U.S. Teasury Reserves

Tax Free Reserves
California Tax Free Reserves
Connecticut Tax Free Reserves
New York Tax Free Reserves

STOCK & BOND FUNDS:
U.S. Government Income Fund
Intermediate Income Fund
National Tax Free Income Fund
New York Tax Free Income Fund

Balanced Fund
Equity Fund
International Equity Fund
Small Cap Equity Fund
Emerging Asian Markets Equity Fund
<PAGE>

TRUSTEES AND OFFICERS
Philip W. Coolidge*, President
H. B. Alvord
Riley C. Gilley
Diana R. Harrington
Susan B. Kerley
C. Oscar Morong, Jr.
Donald B. Otis
E. Kirby Warren
William S. Woods, Jr.

SECRETARY AND TREASURER
James B. Craver*

ASSISTANT TREASURER
Barbara M. O'Dette*

ASSISTANT SECRETARIES
Susan Jakuboski*
Molly S. Mugler*

*Affiliated Person of Administrator and Distributor

---------------------------------------------------

INVESTMENT ADVISER
Citibank, N.A.
153 East 53rd Street, New York, NY 10043

ADMINISTRATOR AND DISTRIBUTOR
The Landmark Funds Broker-Dealer Services, Inc.
6 St. James Avenue, Boston, MA 02116
(617) 423-1679

TRANSFER AGENT AND CUSTODIAN
State Street Bank and Trust Company
225 Franklin Street, Boston, MA 02110

AUDITORS
Deloitte & Touche LLP
125 Summer Street, Boston, MA 02110

LEGAL COUNSEL
Bingham, Dana & Gould
150 Federal Street, Boston, MA 02110

--------------------------------------------------

SHAREHOLDER SERVICING AGENTS
(See Inside Cover)

This report is prepared for the information of shareholders. It is authorized
for distribution to prospective investors only when preceded or accompanied by
an effective prospectus.

This Report is Prepared & Printed on Recycled Paper [LOGO]

FI/INTI/S/95

</TEXT>
</DOCUMENT>
</IMS-DOCUMENT>