N-Q 1 ya17908.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-Q QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY Investment Company Act File Number 811-6628 -------- The Yacktman Funds, Inc. ------------------------ (Exact name of registrant as specified in charter) 1110 Lake Cook Road, Suite 385 Buffalo Grove, Illinois 60089 (Address of principal executive offices) (Zip code) Donald A. Yacktman Yacktman Asset Management Co. 1110 Lake Cook Road, Suite 385 Buffalo Grove, Illinois 60089 (Name and address of agent for service) Registrant's telephone number, including area code: (847) 325-0707 -------------- Date of fiscal year end: December 31 ----------- Date of reporting period: September 30, 2004 ------------------ FORM N-Q ITEM 1. SCHEDULE OF INVESTMENTS. The Yacktman Funds, Inc. Schedules of Investments September 30, 2004 (Unaudited) THE YACKTMAN FOCUSED FUND PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 2004 (UNAUDITED) ------------------------------------------------------------------ NUMBER OF SHARES VALUE ------------------------------------------------------------------ COMMON STOCKS 80.4% BEVERAGES 7.7% Coca-Cola Co. 170,000 $6,808,500 ------------- COMMERCIAL SERVICES & SUPPLIES 2.0% Block H&R, Inc. 35,000 1,729,700 ------------- DIVERSIFIED FINANCIALS 13.1% AmeriCredit Corp.* 350,000 7,308,000 Federal Home Loan Mortgage 65,000 4,240,600 Corp. ------------- 11,548,600 ------------- FOOD PRODUCTS 13.3% Interstate Bakeries Corp. 80,000 312,000 Kraft Foods, Inc. 215,000 6,819,800 Lancaster Colony Corp. 110,000 4,638,150 ------------- 11,769,950 ------------- HEALTH CARE PROVIDERS & 4.3% SERVICES Cardinal Health, Inc. 35,000 1,531,950 First Health Group Corp.* 140,000 2,252,600 ------------- 3,784,550 ------------- HOUSEHOLD PRODUCTS 13.5% Clorox Co. 70,000 3,731,000 Henkel KGaA 85,000 5,911,946 Unilever NV 40,000 2,312,000 ------------- 11,954,946 ------------- INDUSTRIAL CONGLOMERATES 4.5% Tyco International Ltd. 130,000 3,985,800 ------------- IT CONSULTING & SERVICES 2.4% Electronic Data Systems Corp. 110,000 2,132,900 ------------- MEDIA 11.3% Interpublic Group of Cos., Inc.* 193,100 2,044,929 Liberty Media Corp.* 910,000 7,935,200 ------------- 9,980,129 ------------- PHARMACEUTICALS 3.5% Bristol-Myers Squibb Co. 130,000 3,077,100 ------------- REAL ESTATE 2.0% Trizec Properties, Inc. 110,000 1,756,700 ------------- ----------------------------------------------------------------- NUMBER OF SHARES VALUE ----------------------------------------------------------------- SPECIALTY RETAIL 0.6% Friedman's, Inc., Class A 260,000 $535,600 ------------ TOBACCO 2.1% Altria Group., Inc. 40,000 1,881,600 ------------ Total Common Stocks 70,946,075 ------------ (cost $59,151,012) PRINCIPAL AMOUNT VALUE ----------------------------------------------------------------- CORPORATE BONDS 2.7% Fleming Cos., Inc., 10.125%, 4/1/08* $11,825,000 2,158,063 Fleming Cos., Inc., 9.25%, 6/15/10* 1,000,000 182,500 ------------ Total Corporate Bonds (cost $4,810,219) 2,340,563 ------------ SHORT-TERM INVESTMENTS 38.7% COMMERCIAL PAPER 14.7% Citigroup 1.63%, 10/6/04 3,600,000 3,599,185 Prudential Funding, 1.63%, 10/6/04 3,600,000 3,599,185 Rabobank Financial Corp., 1.78%, 10/1/04 2,900,000 2,900,000 UBS Financial, 1.78%, 10/1/04 2,900,000 2,900,000 ------------ Total Commercial Paper (cost $12,998,370) 12,998,370 ------------ THE YACKTMAN FOCUSED FUND PORTFOLIO OF INVESTMENTS (CONT'D.) SEPTEMBER 30, 2004 (UNAUDITED) ----------------------------------------------------------------- PRINCIPAL AMOUNT VALUE ----------------------------------------------------------------- DEMAND NOTE (VARIABLE RATE) 0.4% U.S. Bancorp, 1.59% $376,348 $376,348 ----------- Total Demand Note (cost $376,348) 376,348 ----------- OTHER SHORT-TERM INVESTMENT 23.6% Securities Lending Investment Account (cost $20,796,038) 20,796,038 ----------- Total Short-Term Investments (cost $34,170,756) 34,170,756 ----------- NUMBER OF CONTRACTS VALUE ----------------------------------------------------------------- PUT OPTION PURCHASED 0.8% Omnicom Group Expiring Jan. 2005 @ $100.00 250 673,750 ----------- Total Put Option Purchased 673,750 ----------- (cost $1,003,500) Total Investments (cost $99,135,487) 122.6% 108,131,144 ----------- Other Assets less Liabilities 1.0% 902,111 Less Liability for Collateral -23.6% on Securities Loaned (20,796,038) ----------- Net Assets - 100% (equivalent to $15.80 per share based on 5,585,929 shares outstanding) $88,237,217 =========== * Non-income producing Issue in default See notes to financial statements THE YACKTMAN FUND PORTFOLIO OF INVESTMENTS SEPTEMBER 30, 2004 (UNAUDITED) ---------------------------------------------------------------- NUMBER OF SHARES VALUE ---------------------------------------------------------------- COMMON STOCKS 73.8% AUTO COMPONENTS 0.1% Bandag, Inc., Class A 10,700 $431,103 ---------- BANKS 1.8% U.S. Bancorp 150,000 4,335,000 Washington Mutual, Inc. 40,000 1,563,200 ---------- 5,898,200 ---------- BEVERAGES 6.3% Coca-Cola Co. 420,000 16,821,000 PepsiCo, Inc. 90,000 4,378,500 ---------- 21,199,500 ---------- COMMERCIAL SERVICES & SUPPLIES 1.3% Block H&R, Inc. 90,000 4,447,800 ---------- DIVERSIFIED FINANCIALS 8.8% AmeriCredit Corp.* 880,000 18,374,400 Federal Home Loan Mortgage Corp. 100,000 6,524,000 Federal National Mortgage 70,000 4,438,000 Association ---------- 29,336,400 ---------- FOOD PRODUCTS 12.8% Cadbury Schweppes plc 180,000 5,563,800 Interstate Bakeries Corp. 120,000 468,000 Kraft Foods, Inc. 640,000 20,300,800 Lancaster Colony Corp. 390,000 16,444,350 ---------- 42,776,950 ---------- GAS UTILITIES 1.5% Nicor, Inc. 140,000 5,138,000 ---------- HEALTH CARE PROVIDERS & SERVICES 3.3% Cardinal Health, Inc. 120,000 5,252,400 First Health Group Corp.* 350,000 5,631,500 ---------- 10,883,900 ---------- HOUSEHOLD PRODUCTS 11.0% Clorox Co. 250,000 13,325,000 Henkel KGaA 265,000 18,431,360 Unilever NV 90,000 5,202,000 ---------- 36,958,360 ---------- NUMBER OF SHARES VALUE ---------------------------------------------------------------- INDUSTRIAL CONGLOMERATES 3.8% Tyco International Ltd. 420,000 $12,877,200 ----------- INSURANCE 1.3% MBIA, Inc. 40,000 2,328,400 MGIC Investment Corp. 30,000 1,996,500 ----------- 4,324,900 ----------- INTERNET & CATALOG RETAIL 0.3% Blair Corp. 40,000 1,127,200 ----------- IT CONSULTING & SERVICES 3.4% Electronic Data Systems Corp. 300,000 5,817,000 First Data Corp. 130,000 5,655,000 ----------- 11,472,000 ----------- MEDIA 8.9% Interpublic Group of Cos., Inc.* 480,000 5,083,200 Liberty Media Corp.* 2,850,000 24,852,000 ----------- 29,935,200 ----------- PHARMACEUTICALS 4.8% Bristol-Myers Squibb Co. 380,000 8,994,600 Johnson & Johnson 70,000 3,943,100 Pfizer, Inc. 100,000 3,060,000 ----------- 15,997,700 ----------- REAL ESTATE 1.9% Trizec Properties, Inc. 400,000 6,388,000 ----------- SOFTWARE 0.8% Microsoft Corp. 100,000 2,765,000 ----------- SPECIALTY RETAIL 0.3% Friedman's, Inc., Class A 465,000 957,900 ----------- TOBACCO 1.4% Altria Group, Inc. 100,000 4,704,000 ----------- Total Common Stocks (cost $186,144,030) 247,619,313 ----------- THE YACKTMAN FUND PORTFOLIO OF INVESTMENTS (CONT'D.) SEPTEMBER 30, 2004 (UNAUDITED) ---------------------------------------------------------------- PRINCIPAL AMOUNT VALUE ---------------------------------------------------------------- CORPORATE BONDS 1.9% Fleming Cos., Inc., 10.125%, 4/1/08* $18,400,000 $3,358,000 Fleming Cos., Inc., 9.25%, 6/15/10* 17,175,000 3,134,438 ----------- Total Corporate Bonds (cost $14,128,053) 6,492,438 ----------- SHORT-TERM INVESTMENTS 47.5% COMMERCIAL PAPER 23.9% AmEx 1.63%, 10/6/04 16,000,000 15,996,378 Citigroup 1.63%, 10/6/04 16,000,000 15,996,378 Prudential Funding, 1.63%, 10/6/04 16,000,000 15,996,377 Rabobank Financial Corp., 1.78%, 10/1/04 16,000,000 16,000,000 UBS Financial, 1.78%, 10/1/04 16,000,000 16,000,000 ----------- Total Commercial Paper 79,989,133 (cost $79,989,133) ----------- DEMAND NOTE (VARIABLE RATE) 0.1% U.S. Bancorp, 1.59% 416,056 416,056 ----------- Total Demand Note 416,056 (cost $416,056) ----------- OTHER SHORT-TERM INVESTMENT 23.4% Securities Lending Investment Account $78,318,612 (cost $78,318,612) ----------- Total Short-Term Investments (cost $158,723,801) 158,723,801 ----------- Total Investments (cost $358,995,884) 123.1% 412,835,552 ----------- Other Assets less Liabilities 0.3% 946,165 Less Liability for (23.4)% Collateral on Securities Loaned (78,318,612) ----------- Net Assets - 100% (equivalent to $14.96 per share based on 22,421,436 shares outstanding) $335,463,105 ============ * Non-income producing Issue in default See notes to financial statements ITEM 2. CONTROLS AND PROCEDURES. (a) The Registrant's principal executive and principal financial officers have concluded, based on their evaluation of the Registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the Registrant's disclosure controls and procedures are reasonably designed to ensure that information required to be disclosed by the Registrant on Form N-Q is recorded, processed, summarized and reported within the required time periods and that information required to be disclosed by the Registrant in the reports that it files or submits on Form N-Q is accumulated and communicated to the Registrant's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. (b) There were no changes to the Registrant's internal control over financial reporting that occurred during the Registrant's most recently ended fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Registrant's internal control over financial reporting. ITEM 3. EXHIBITS. (a) Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) under the Investment Company Act of 1940. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. The Yacktman Funds, Inc. By: /s/ Donald A. Yacktman -------------------------------------------------------- Donald A. Yacktman Principal Executive Officer Date: October 26, 2004 ------------------------------------------------------ Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ Donald A. Yacktman -------------------------------------------------------- Donald A. Yacktman Principal Executive Officer Date: October 26, 2004 ------------------------------------------------------ By: /s/ Donald A. Yacktman -------------------------------------------------------- Donald A. Yacktman Principal Financial Officer Date: October 26, 2004 ------------------------------------------------------ EXHIBIT INDEX (a) Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) under the Investment Company Act of 1940. (EX-99.CERT)