N-CSR 1 dncsr.txt S/B TRAVELERS SERIES FUND INC UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-8372 Travelers Series Fund Inc. (Exact name of registrant as specified in charter) 125 Broad Street, New York, NY 10004 (Address of principal executive offices) (Zip code) Christina T. Sydor, Esq. 300 First Stamford Place Stamford, CT 06902 (Name and address of agent for service) Registrant's telephone number, including area code: (800) 451-2010 Date of fiscal year end: October 31 Date of reporting period: April 30, 2003 ITEM 1. REPORT TO STOCKHOLDERS. The Semi-Annual Report to Stockholders is filed herewith. TRAVELERS SERIES FUND INC. SMITH BARNEY INTERNATIONAL ALL CAP GROWTH PORTFOLIO SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO SEMI-ANNUAL REPORT | APRIL 30, 2003 NOT FDIC INSURED . NOT BANK GUARANTEED . MAY LOSE VALUE WHAT'S INSIDE Letter From the Chairman............................... 1 Schedules of Investments............................... 2 Statements of Assets and Liabilities................... 15 Statements of Operations............................... 16 Statements of Changes in Net Assets.................... 17 Notes to Financial Statements.......................... 19 Financial Highlights................................... 26
LETTER FROM THE CHAIRMAN [PHOTO] R. JAY GERKEN Chairman, President and Chief Executive Officer Dear Shareholder, The philosopher Bertrand Russell famously remarked that, "Change is one thing, progress is another." You will notice in the following pages that we have begun to implement some changes to your shareholder report and we will be reflecting other changes on future reports. Our aim is to make meaningful improvements in reporting on the management of your Fund and its performance, not just to enact change for change's sake. Please bear with us during this transition period. I invite you to read this report in full. Please take the opportunity to talk to your financial adviser about this report or any other questions or concerns you have about your Fund and your financial future. As always, thank you for entrusting your assets to us. We look forward to helping you continue to meet your financial goals. Sincerely, /s/ R. Jay Gerken R. Jay Gerken Chairman, President and Chief Executive Officer May 27, 2003 1 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) APRIL 30, 2003 SMITH BARNEY INTERNATIONAL ALL CAP GROWTH PORTFOLIO
SHARES SECURITY VALUE ----------------------------------------------------- STOCKS -- 100.0% Canada -- 1.7% 90,000 Celestica Inc. (a) $ 1,035,565 164,000 Patheon, Inc. (a) 1,652,580 ----------------------------------------------------- 2,688,145 ----------------------------------------------------- Denmark -- 1.9% 86,000 Novo Nordisk A/S 3,120,305 ----------------------------------------------------- Finland -- 3.1% 300,000 Nokia Oyj 4,980,356 ----------------------------------------------------- France -- 9.1% 44,000 Aventis S.A. (b) 2,238,929 240,000 Axa (b) 3,652,163 30,000 Groupe Danone (b) 4,253,254 34,000 Total Fina Elf SA 4,466,811 ----------------------------------------------------- 14,611,157 ----------------------------------------------------- Germany -- 3.3% 33,500 BASF AG (b) 1,497,131 30,000 Fielmann AG 1,174,005 25,000 SAP AG (b) 2,566,041 ----------------------------------------------------- 5,237,177 ----------------------------------------------------- Hong Kong -- 5.2% 195,535 HSBC Holdings PLC (b) 2,137,358 500,000 Hutchison Whampoa Ltd. 2,782,390 900,000 Johnson Electric Holdings Ltd. 969,349 1,000,000 Li & Fung Ltd. 1,121,932 278,000 Sun Hung Kai Properties Ltd. 1,304,620 ----------------------------------------------------- 8,315,649 ----------------------------------------------------- Ireland -- 7.4% 300,000 Bank of Ireland 3,672,960 202,753 CRH PLC 3,117,101 700,000 Grafton Group PLC 2,755,000 253,755 Irish Continental Group PLC 2,403,139 ----------------------------------------------------- 11,948,200 ----------------------------------------------------- Italy -- 1.3% 300,000 Saipem S.p.A. 2,096,438 ----------------------------------------------------- Japan -- 17.9% 76,000 Canon Inc. 3,076,251 216,000 Dowa Mining Co., Ltd. 716,493 40,000 Honda Motor Co., Ltd. 1,326,839 70,000 Ito-Yokado Co., Ltd. 1,648,892
See Notes to Financial Statements. 2 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SMITH BARNEY INTERNATIONAL ALL CAP GROWTH PORTFOLIO
SHARES SECURITY VALUE --------------------------------------------------------------- Japan -- 17.9% (continued) 380,000 JGC Corp. $ 2,680,551 118,000 Kao Corp. (b) 2,155,274 26,000 Mabuchi Motor Co., Ltd. 1,945,415 192,000 Nomura Holdings, Inc. (b) 1,904,199 1,390 NTT DoCoMo, Inc. 2,871,515 176,000 OJI Paper Co., Ltd. 666,577 42,000 Seven-Eleven Japan Co., Ltd. 1,001,680 53,000 Takeda Chemical Industries, Ltd. 1,944,995 195,000 Terumo Corp. 3,247,271 23,000 Tokyo Electron Ltd. 863,369 105,000 Yamanouchi Pharmaceutical Co., Ltd. 2,654,098 --------------------------------------------------------------- 28,703,419 --------------------------------------------------------------- Mexico -- 2.2% 1,400,000 Wal-Mart de Mexico S.A. de C.V. 3,556,848 --------------------------------------------------------------- The Netherlands -- 6.0% 75,000 Heineken NV 2,789,940 51,662 IHC Caland N.V. 2,671,553 100,000 Royal Dutch Petroleum Co. (b) 4,097,838 --------------------------------------------------------------- 9,559,331 --------------------------------------------------------------- Norway -- 1.6% 539,000 Tomra Systems ASA (b) 2,551,233 --------------------------------------------------------------- Singapore -- 5.2% 275,000 DBS Group Holdings, Ltd. 1,348,609 290,000 Singapore Press Holdings, Ltd. 2,697,219 2,000,000 Singapore Technologies Engineering, Ltd. 1,803,782 300,000 Venture Corp. Ltd. 2,502,748 --------------------------------------------------------------- 8,352,358 --------------------------------------------------------------- Spain -- 4.4% 175,000 Banco Bilbao Vizcaya Argentaria S.A. 1,764,922 311,000 Indra Sistemas, S.A. 2,677,515 230,840 Telefonica, S.A. 2,557,791 --------------------------------------------------------------- 7,000,228 --------------------------------------------------------------- Sweden -- 1.1% 183,000 Assa Abloy AB (a)(b) 1,746,333 --------------------------------------------------------------- Switzerland -- 7.4% 140,000 Mettler-Toledo International Inc. (a)(b) 4,970,000 9,300 Nestle S.A. (b) 1,898,099 125,000 Novartis AG 4,936,335 --------------------------------------------------------------- 11,804,434 ---------------------------------------------------------------
See Notes to Financial Statements. 3 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SMITH BARNEY INTERNATIONAL ALL CAP GROWTH PORTFOLIO
SHARES SECURITY VALUE ------------------------------------------------------- United Kingdom -- 21.2% 145,000 BOC Group PLC $ 1,829,965 400,000 BP PLC 2,536,886 900,000 Capita Group PLC 3,649,372 650,000 Compass Group PLC 2,994,357 311,000 Diageo PLC (a) 3,452,372 100,000 GlaxoSmithKline PLC 2,005,835 183,000 Jardine Lloyd Thompson Group PLC 1,669,339 72,000 Kingfisher PLC 281,585 275,000 Lloyds TSB Group PLC 1,810,090 415,000 Misys PLC (a) 1,271,202 1,850,000 Serco Group PLC 4,616,300 675,000 Taylor Nelson Sofres PLC 1,441,394 645,889 Tesco PLC 2,045,600 2,192,373 Vodafone Group PLC 4,330,909 ------------------------------------------------------- 33,935,206 ------------------------------------------------------- TOTAL INVESTMENTS -- 100% (Cost -- $174,371,114*) $160,206,817 -------------------------------------------------------
(a) Non-income producing security. (b) All or a portion of this security is on loan (See Note 6). * Aggregate cost for Federal income tax purposes is substantially the same. LOANED SECURITIES COLLATERAL (UNAUDITED) APRIL 30, 2003
FACE AMOUNT SECURITY VALUE --------------------------------------------------------------------------------------- $19,471,898 State Street Navigator Securities Lending Trust Prime Portfolio (Cost -- $19,471,898) $19,471,898 ---------------------------------------------------------------------------------------
See Notes to Financial Statements. 4 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE ---------------------------------------------------------------------------------------- BONDS AND NOTES -- 79.4% Algeria -- 0.2% Republic of Algeria: 10,500 Loan Tranche 1, 2.625% due 9/4/06 $ 10,264 61,764 Loan Tranche 3, 2.625% due 3/4/10 58,290 ---------------------------------------------------------------------------------------- 68,554 ---------------------------------------------------------------------------------------- The Bahamas -- 0.1% 25,000 Sun International Hotels Ltd., Sr. Sub. Notes, 8.875% due 8/15/11 26,625 ---------------------------------------------------------------------------------------- Brazil -- 3.8% Republic of Brazil: 369,423 Bonds, 8.000% due 4/15/14 325,900 Notes: 25,000 11.250% due 7/26/07 25,875 150,000 11.500% due 3/12/08 153,750 400,000 14.500% due 10/15/09 456,000 125,000 12.000% due 4/15/10 127,500 100,000 2.188% due 4/15/12 74,406 ---------------------------------------------------------------------------------------- 1,163,431 ---------------------------------------------------------------------------------------- Bulgaria -- 0.4% 135,715 Bulgaria FLIRB, Series A, 2.688% due 7/28/12 130,286 ---------------------------------------------------------------------------------------- Canada -- 0.9% 50,000 Abitibi-Consolidated Inc., Debentures, 8.850% due 8/1/30 55,589 25,000 Calpine Canada Energy Finance, Sr. Notes, 8.500% due 5/1/08 18,562 25,000 Methanex Corp., Sr. Notes, 8.750% due 8/15/12 27,688 25,000 Millar Western Forest Products Ltd., Sr. Notes, 9.875% due 5/15/08 26,125 50,000 Nexfor Inc., Notes, 7.250% due 7/1/12 55,547 50,000 Potash Corp. of Saskatchewan Inc., Notes, 4.875% due 3/1/13 49,766 25,000 Tembec Industries Inc., Sr. Notes, 8.625% due 6/30/09 (a) 26,125 ---------------------------------------------------------------------------------------- 259,402 ---------------------------------------------------------------------------------------- Colombia -- 0.8% Republic of Colombia: 50,000 Bonds, 8.625% due 4/1/08 53,250 175,000 Notes, 10.000% due 1/23/12 193,681 ---------------------------------------------------------------------------------------- 246,931 ---------------------------------------------------------------------------------------- Ecuador -- 0.6% Republic of Ecuador: 25,000 Bonds, 12.000% due 11/15/12 21,094 280,000 Step bond to yield 18.434% due 8/15/30 175,000 ---------------------------------------------------------------------------------------- 196,094 ----------------------------------------------------------------------------------------
See Notes to Financial Statements. 5 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE ----------------------------------------------------------------------------------------- France -- 2.1% 530,000/EUR/ French Treasury Notes, 3.500% due 1/12/08 $ 597,827 25,000 Vivendi Universal SA, Sr. Notes, 9.250% due 4/15/10 (a) 28,187 ----------------------------------------------------------------------------------------- 626,014 ----------------------------------------------------------------------------------------- Germany -- 1.9% 500,000/EUR/ Bundesobligation, Bonds, Series 141, 4.250% due 2/15/08 582,990 ----------------------------------------------------------------------------------------- Ireland -- 0.1% 25,000 MDP Acquisitions PLC, Sr. Notes, 9.625% due 10/1/12 (a) 27,250 ----------------------------------------------------------------------------------------- Italy -- 0.4% 125,000 Region of Lombardy, Inc., Notes, 5.804% due 10/25/32 (b) 134,184 ----------------------------------------------------------------------------------------- The Marshall Islands -- 0.2% 50,000 General Maritime Corp., Sr. Notes, 10.000% due 3/15/13 (a) 54,250 ----------------------------------------------------------------------------------------- Mexico -- 3.4% United Mexican States: 450,000 Bonds, Series MTN, 8.300% due 8/15/31 509,738 Notes: 350,000 8.375% due 1/14/11 417,550 100,000 6.625% due 3/3/15 104,675 ----------------------------------------------------------------------------------------- 1,031,963 ----------------------------------------------------------------------------------------- Morocco -- 0.3% 105,988 Kingdom of Morocco, Restructured Debentures, 2.562% due 1/5/09 99,629 ----------------------------------------------------------------------------------------- Panama -- 0.5% Republic of Panama, Bonds: 25,000 9.625% due 2/8/11 28,625 100,000 9.375% due 1/16/23 108,500 ----------------------------------------------------------------------------------------- 137,125 ----------------------------------------------------------------------------------------- Peru -- 0.3% 120,000 Republic of Peru, 4.500% due 3/7/17 105,150 ----------------------------------------------------------------------------------------- Philippines -- 0.9% Republic of Philippines: 70,000 Bonds, 9.875% due 1/15/19 73,063 200,000 Notes, 8.375% due 3/12/09 207,000 ----------------------------------------------------------------------------------------- 280,063 ----------------------------------------------------------------------------------------- Russia -- 2.5% Russian Federation, Bonds: 348,108 8.250% due 3/31/10 394,667 400,400 5.000% due 3/31/30 362,112 ----------------------------------------------------------------------------------------- 756,779 ----------------------------------------------------------------------------------------- Supra-National -- 0.4% 100,000 Corporacion Andina de Fomento, Notes, 6.875% due 3/15/12 (c) 106,786 -----------------------------------------------------------------------------------------
See Notes to Financial Statements. 6 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE ---------------------------------------------------------------------------------------------- Turkey -- 0.3% 100,000 Republic of Turkey, Notes, 11.500% due 1/23/12 $ 101,500 ---------------------------------------------------------------------------------------------- United Kingdom -- 0.6% Avon Energy Partners Holdings: 50,000 Notes, 6.460% due 3/4/08 (a) 43,500 25,000 Sr. Notes, 7.050% due 12/11/07 (a) 21,875 50,000 Premier International Foods PLC, Sr. Notes, 12.000% due 9/1/09 55,250 XEROX Cap Europe PLC: 50,000 Bonds, 5.875% due 5/15/04 50,625 25,000 Notes, 5.500% due 11/15/03 25,375 ---------------------------------------------------------------------------------------------- 196,625 ---------------------------------------------------------------------------------------------- United States -- 58.7% 50,000 aaiPharma Inc., Sr. Sub. Notes, 11.000% due 4/1/10 53,750 50,000 Acetex Corp., Sr. Notes, 10.875% due 8/1/09 55,250 50,000 AdvancePCS, Sr. Notes, 8.500% due 4/1/08 54,250 25,000 Ahold Finance USA, Inc., Sr. Unsecured Notes, 6.875% due 5/1/29 18,750 50,000 Alliant Techsystems Inc., Sr. Sub. Notes, 8.500% due 5/15/11 54,750 Allied Waste North America: 25,000 Sr. Notes, 9.250% due 9/1/12 (a) 27,500 50,000 Sr. Sub. Notes, Series B, 10.000% due 8/1/09 53,687 25,000 American Cellular Corp., Sr. Sub. Notes, 9.500% due 10/15/09 6,625 American Tower Corp.: 15,000 Discount Notes, zero coupon bond to yield 14.440% due 8/1/08 (a) 9,450 25,000 Notes, 5.000% due 2/15/10 (c) 21,250 55,000 Sr. Notes, 9.375% due 2/1/09 54,725 50,000 Ameripath Inc., Sr. Sub. Notes, 10.500% due 4/1/13 (a) 53,250 50,000 Ameristar Casinos, Inc., Sr. Sub. Notes, 10.750% due 2/15/09 56,250 150,000 Amortizing Residential Collateral Trust, Series 2002-BC6, 2.520% due 8/25/32 146,827 25,000 Anchor Glass Container Corp., Sr. Secured Notes, 11.000% due 2/15/13 (a) 26,625 50,000 AOL Time Warner Inc., Sr. Unsecured Notes, 7.625% due 4/15/31 55,343 35,000 Applica Inc., Sr. Sub. Notes, 10.000% due 7/31/08 36,750 15,000 Applied Extrusion Technologies, Inc., Sr. Notes, Series B, 10.750% due 7/1/11 11,175 50,000 Argosy Gaming Co., Sr. Sub. Notes, 10.750% due 6/1/09 55,500 100,000 AT&T Corp., Sr. Notes, 8.500% due 11/15/31 111,723 250,000 AT&T Wireless Services Inc., Sr. Notes, 8.750% due 3/1/31 (b) 312,425 60,000 Bank of America Corp., Sr. Notes, 5.250% due 2/1/07 65,211 250,000 Bayview Financial Acquisition Trust 2001, Class M3, Home Equity Loan Trust, 2.570% due 8/25/36 (a)(b) 241,875 25,000 Berry Plastics Corp., Sr. Sub. Notes, 10.750% due 7/15/12 27,375 25,000 BRL Universal Equipment Corp., Secured Notes, 8.875% due 2/15/08 27,250
See Notes to Financial Statements. 7 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE --------------------------------------------------------------------------------------------- United States -- 58.7% (continued) Buckeye Technologies Inc., Sr. Sub. Notes: 25,000 8.500% due 12/15/05 $ 24,750 25,000 8.000% due 10/15/10 23,125 Calpine Corp., Sr. Notes: 50,000 8.750% due 7/15/07 36,250 50,000 8.500% due 2/15/11 36,750 50,000 Canandaigua Brands Inc., Sr. Sub. Notes, 8.500% due 3/1/09 53,000 100,000 Capital One Financial, Notes, 7.250% due 5/1/06 104,262 25,000 Capstar Hotel Co., Sr. Sub. Notes, 8.750% due 8/15/07 18,750 Charter Communications Holdings, LLC: Sr. Discount Notes, step bond to yield: 60,000 16.603% due 4/1/11 34,800 65,000 22.011% due 5/15/11 29,575 Sr. Notes: 25,000 10.750% due 10/1/09 16,750 75,000 10.250% due 1/15/10 49,500 25,000 CMS Energy Corp., Sr. Notes, 9.875% due 10/15/07 26,125 50,000 Coast Hotels and Casinos, Inc., Sr. Sub. Notes, 9.500% due 4/1/09 54,000 Cole National Group, Inc., Sr. Sub. Notes: 25,000 8.625% due 8/15/07 23,062 25,000 8.875% due 5/15/12 22,937 25,000 Compass Minerals Group, Inc., Sr. Sub. Notes, 10.000% due 8/15/11 27,875 25,000 CONMED Corp., Sr. Sub. Notes, 9.000% due 3/15/08 26,062 25,000 Constellation Brands Inc., Sr. Sub. Notes, Series B, 8.125% due 1/15/12 26,656 100,000 Cox Communications Inc., Notes, 7.750% due 11/1/10 120,266 Crown Castle International Corp.: 25,000 Sr. Discount Notes, 10.625% due 11/15/07 25,937 50,000 Sr. Notes, 10.750% due 8/1/11 51,750 CSC Holdings, Inc., Sr. Sub. Debentures: 75,000 9.875% due 2/15/13 78,937 25,000 10.500% due 5/15/16 28,312 50,000 CSK Auto Inc., Sr. Notes, 12.000% due 6/15/06 55,062 25,000 Dana Corp., Notes, 9.000% due 8/15/11 27,250 25,000 Del Monte Corp., Sr. Sub. Notes, Series B, 9.250% due 5/15/11 27,156 27,739 Delta Funding NIM, Series 2000-1, Home Equity Loan Trust, 12.500% due 10/26/30 (a) 27,739 50,000 Devon Financing Corp., Unsecured Notes, 6.875% due 9/30/11 57,603 25,000 DEX Media East LLC, Sr. Notes, 9.875% due 11/15/09 (a) 28,750 50,000 DIRECTV Holdings LLC, Sr. Notes, 8.375% due 3/15/13 (a) 56,250 25,000 Dole Foods Co., Sr. Notes, 8.875% due 3/15/11 (a) 27,312 EchoStar DBS Corp., Sr. Notes: 25,000 10.375% due 10/1/07 28,125 50,000 9.125% due 1/15/09 56,500 50,000 9.375% due 2/1/09 54,187 90,000 Edison Mission Energy, Sr. Notes, 9.875% due 4/15/11 81,675
See Notes to Financial Statements. 8 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE ------------------------------------------------------------------------------------------------- United States -- 58.7% (continued) 25,000 Extendicare Health Service, Inc., Sr. Sub. Notes, 9.500% due 7/1/10 $ 24,875 50,000 Eye Care Centers of America, Sr. Sub. Notes, 9.125% due 5/1/08 46,250 25,000 Fedders North America, Inc., Sr. Sub. Notes, 9.375% due 8/15/07 21,000 1,250,000 Federal Home Loan Mortgage Corp., Gold, 6.000% due 5/1/33 (d) 1,300,390 Federal National Mortgage Association: 1,000,000 6.500% due 5/1/33 (d) 1,045,000 2,500,000 7.000% due 5/1/33 (d) 2,642,187 50,000 Felcor Lodging Ltd. Partnership, Sr. Notes, 8.500% due 6/1/11 48,875 50,000 Finlay Fine Jewelry Corp., Sr. Notes, 8.375% due 5/1/08 51,250 25,000 Fleming Cos. Inc., Sr. Notes, 10.125% due 4/1/08 (e) 3,687 35,000 Flowserve Corp., Sr. Sub. Notes, 12.250% due 8/15/10 39,725 75,000 FMC Corp., Debentures, 7.750% due 7/1/11 72,504 25,000 Ford Motor Co., Notes, 7.450% due 7/16/31 22,311 25,000 Ford Motor Credit Corp., Notes, 7.250% due 10/25/11 25,102 100,000 G-Force cdo, Ltd., Series 2002-1A, 2.220% due 6/25/37 (a) 99,187 60,000 The Gap Inc., Notes, 10.550% due 12/15/08 71,850 115,000 General Electric Capital Corp., Notes, 3.500% due 5/1/08 115,654 Global Crossing Holdings Ltd., Sr. Notes: 10,000 9.125% due 11/15/06 (e) 338 55,000 9.625% due 5/15/08 (e) 1,856 100,000 The Goldman Sachs Group Inc., Notes, 6.600% due 1/15/12 112,932 25,000 Graphic Packaging Corp., Sub. Notes, 8.625% due 2/15/12 26,375 360,000 Green Tree Home Equity Loan Trust, 7.880% due 9/15/30 (b) 385,110 25,000 Grey Wolf Inc., Sr. Notes, 8.875% due 7/1/07 25,906 25,000 Guitar Center Management, Sr. Notes, 11.000% due 7/1/06 25,687 50,000 HCA Inc., Notes, 6.910% due 6/15/05 53,177 25,000 Herbst Gaming Inc., Secured Notes, Series B, 10.750% due 9/1/08 27,562 25,000 Hilton Hotels Corp., Notes, 7.625% due 12/1/12 26,680 50,000 HMH Properties, Inc., Sr. Notes, Series C, 8.450% due 12/1/08 51,500 25,000 Holmes Group Inc., Sr. Sub. Notes, Series B, 9.875% due 11/15/07 22,875 50,000 Home Interiors & Gifts Inc., Sr. Sub. Notes, 10.125% due 6/1/08 51,250 50,000 Horseshoe Gaming Holding Corp., Sr. Sub. Notes, Series B, 8.625% due 5/15/09 53,375 200,000 Household Finance Corp., Notes, 8.000% due 7/15/10 (b) 241,053 40,000 IASIS Healthcare Corp., Sr. Sub. Notes, 13.000% due 10/15/09 44,800 25,000 Icon Health & Fitness Inc., Sr. Sub. Notes, 11.250% due 4/1/12 26,125 25,000 InSight Health Services Corp., Sr. Sub. Notes, Series B, 9.875% due 11/1/11 23,625 25,000 Insight Midwest, Sr. Notes, 10.500% due 11/1/10 27,812 25,000 Interface Inc., Sr. Sub. Notes, Series B, 9.500% due 11/15/05 20,375 50,000 International Lease Finance Corp., Notes, 6.375% due 3/15/09 54,170 50,000 Iron Mountain Inc., Sr. Notes, 8.125% due 5/15/08 52,500 50,000 ISP Chemco Inc., Sr. Sub. Notes, Series B, 10.250% due 7/1/11 54,750 25,000 J.C. Penney Co. Inc., Notes, 8.000% due 3/1/10 26,688
See Notes to Financial Statements. 9 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE ---------------------------------------------------------------------------------------------- United States -- 58.7% (continued) 250,000 J.P. Morgan Chase Commercial Mortgage, Series 2001-CIBC, Class A2, 6.001% due 3/15/33 (b) $ 276,299 50,000 Jefferson Smurfit Corp., Sr. Notes, 8.250% due 10/1/12 54,625 40,000 Kraft Foods Inc., Notes, 5.625% due 11/1/11 41,923 25,000 L-3 Communications Corp., Sr. Sub. Notes, 7.625% due 6/15/12 27,688 100,000 LB Commercial Conduit Mortgage Trust, Series 1999-C1, Class A2, 6.780% due 6/15/31 (b) 114,617 25,000 LDM Technologies, Inc., Sr. Sub. Notes, Series B, 10.750% due 1/15/07 23,500 Levi Strauss & Co.: 35,000 Notes, 6.800% due 11/1/03 35,788 Sr. Notes: 10,000 11.625% due 1/15/08 8,500 65,000 12.250% due 12/15/12 (a) 54,275 50,000 LIN Television Corp., Sr. Notes, 8.000% due 1/15/08 54,250 50,000 Magnum Hunter Resources, Inc., Sr. Notes, 9.600% due 3/15/12 54,250 Mail-Well I Corp: 25,000 Sr. Notes, 9.625% due 3/15/12 25,500 25,000 Sr. Sub. Notes, Series B, 8.750% due 12/15/08 22,375 Mediacom Broadband LLC, Sr. Notes: 50,000 9.500% due 1/15/13 54,000 25,000 11.000% due 7/15/13 28,563 125,000 Merit Securities Corp., Series 11PA, Class B2, 2.820% due 9/28/32 112,031 50,000 MGM MIRAGE, Sr. Sub. Notes, 9.750% due 6/1/07 56,250 Millennium America Inc.: 25,000 Sr. Notes, 9.250% due 6/15/08 (a) 27,625 25,000 Sr. Sub. Notes, 9.250% due 6/15/08 27,625 75,000 Morgan Stanley, Notes, 4.250% due 5/15/10 74,590 25,000 Motorola Inc., Sr. Notes, 8.000% due 11/1/11 28,875 175,000 Nextel Communications, Sr. Notes, 9.375% due 11/15/09 (b) 189,875 25,000 NextMedia Operating Inc., Sr. Sub. Notes, 10.750% due 7/1/11 27,813 75,000 NiSource Finance Corp., Sr. Notes, 7.500% due 11/15/03 77,346 25,000 NMHG Holding Co., Sr. Notes, 10.000% due 5/15/09 26,875 50,000 Nortek, Inc., Sr. Notes, Series B, 8.875% due 8/1/08 52,000 25,000 North Atlantic Trading Co., Sr. Notes, Series B, 11.000% due 6/15/04 25,094 15,000 Noveon Inc., Sr. Sub. Notes, Series B, 11.000% due 2/28/11 17,025 40,000 Ocean Energy, Sr. Sub. Notes, Series B, 8.375% due 7/1/08 42,250 25,000 OM Group, Inc., Sr. Sub. Notes, 9.250% due 12/15/11 21,500 50,000 P&L Coal Holdings Corp., Sr. Sub. Notes, Series B, 9.625% due 5/15/08 52,563 Park Place Entertainment Corp., Sr. Sub. Notes: 25,000 9.375% due 2/15/07 27,250 25,000 7.875% due 3/15/10 26,156 25,000 8.125% due 5/15/11 26,563
See Notes to Financial Statements. 10 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE -------------------------------------------------------------------------------------------- United States -- 58.7% (continued) 25,000 PETCO Animal Supplies, Inc., Sr. Sub. Notes, 10.750% due 11/1/11 $ 28,250 25,000 Pioneer Natural Resources Co., Sr. Notes, 9.625% due 4/1/10 30,795 Plastipak Holdings, Inc., Sr. Notes: 25,000 10.750% due 9/1/11 27,125 25,000 10.750% due 9/1/11 (a) 27,125 50,000 Playtex Products, Inc., Sr. Sub. Notes, 9.375% due 6/1/11 54,500 45,000 Pogo Producing Co., Sr. Sub. Notes, Series B, 8.250% due 4/15/11 49,050 25,000 Pride International Inc., Sr. Notes, 10.000% due 6/1/09 27,500 25,000 Prime Hospitality Corp., Sr. Sub. Notes, Series B, 8.375% due 5/1/12 23,625 75,000 Qwest Corp., Notes, 8.875% due 3/15/12 (a) 82,500 50,000 Qwest Service Corp., Notes, 14.000% due 12/15/14 (a) 57,250 25,000 R.H. Donnelley Financial Corp. Inc., Sr. Sub. Notes, 10.875% due 12/15/12 (a) 29,063 25,000 Radio One, Inc., Sr. Sub. Notes, Series B, 8.875% due 7/1/11 27,625 25,000 Radnor Holdings Inc., Sr. Notes, 11.000% due 3/15/10 (a) 25,125 29,000 Remington Product Co., LLC, Sr. Sub. Notes, Series D, 11.000% due 5/15/06 29,725 37,647 Republic Engineered Products LLC, Secured Notes, 10.000% due 8/16/09 9,412 200,000 Republic Technologies International, LLC, Sr. Sub. Notes, 13.750% due 7/15/09 (e) 2,000 25,000 Resolution Performance Products LLC/RPP Capital Corp., Sr. Notes, 9.500% due 4/15/10 (a) 26,875 25,000 Rexnord Corp., Sr. Sub. Notes, 10.125% due 12/15/12 (a) 27,000 Rite Aid Corp.: 25,000 Notes, 7.125% due 1/15/07 24,250 50,000 Sr. Notes, 11.250% due 7/1/08 54,500 50,000 Riverwood International Co., Sr. Notes, 10.625% due 8/1/07 52,500 75,000 Safeway Inc., Debentures, 7.250% due 2/1/31 84,222 25,000 Saks Inc., Notes, 9.875% due 10/1/11 28,125 50,000 SBA Communications Corp., Sr. Discount Notes, 12.000% due 3/1/08 45,250 55,000 Sealy Mattress Co., Sr. Discount Notes, Series B, 10.875% due 12/15/07 57,750 60,000 Sears Roebuck Acceptance Corp., Notes, 7.000% due 6/1/32 61,469 25,000 Sequa Corp., Sr. Notes, 9.000% due 8/1/09 26,250 25,000 Sitel Corp., Sr. Sub. Notes, 9.250% due 3/15/06 24,125 Sprint Capital Corp., Notes: 200,000 8.375% due 3/15/12 223,500 50,000 6.875% due 11/15/28 46,500 75,000 8.750% due 3/15/32 82,500 50,000 Starwood Hotels & Resorts Worldwide, Inc., Notes, 7.875% due 5/1/12 52,563 75,000 Station Casinos, Inc., Sr. Sub. Notes, 9.875% due 7/1/10 83,063 25,000 Stone Energy Corp., Sr. Sub. Notes, 8.250% due 12/15/11 26,188
See Notes to Financial Statements. 11 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE ---------------------------------------------------------------------------------------- United States -- 58.7% (continued) 16,000 TeleCorp PCS, Inc., Sr. Sub. Notes, 10.625% due 7/15/10 $ 19,120 55,000 TeleWest Communication PLC, Sr. Discount Notes, step bond to yield 23.448% due 2/1/10 10,450 50,000 Tenet Healthcare Corp., Sr. Notes, 6.875% due 11/15/31 45,750 50,000 Terex Corp., Sr. Sub. Notes, Series B, 10.375% due 4/1/11 55,750 25,000 Terra Industries, Sr. Notes, Series B, 10.500% due 6/15/05 24,750 75,000 Time Warner Inc., Debentures, 6.625% due 5/15/29 74,328 50,000 Tommy Hilfiger U.S.A., Inc., Sr. Notes, 6.850% due 6/1/08 49,750 50,000 Triad Hospitals Inc., Sr. Notes, Series B, 8.750% due 5/1/09 54,625 75,000 Tropical Sportswear International Corp., Sr. Sub. Notes, Series A, 11.000% due 6/15/08 76,875 25,000 TRW Automotive Inc., Sr. Notes, 9.375% due 2/15/13 (a) 27,438 25,000 Turning Stone Casino Resort Enterprise, Sr. Notes, 9.125% due 12/15/10 (a) 26,438 400,000 U.S. Treasury Bonds, 6.250% due 5/15/30 (b) 482,110 U.S. Treasury Notes: 250,000 5.625% due 5/15/08 (b) 282,393 2,000,000 4.875% due 2/15/12 (b) 2,168,908 50,000 Unisys Corp., Sr. Notes, 8.125% due 6/1/06 53,750 United Industries Corp., Sr. Sub. Notes: 25,000 9.875% due 4/1/09 (a) 26,625 50,000 Series B, 9.875% due 4/1/09 53,250 United Pan-Europe Communications N.V., Series B: Sr. Discount Notes: 50,000 Step bond to yield 49.267% due 11/1/09 (e) 5,063 30,000 Step bond to yield 28.402% due 2/1/10 (e) 3,038 Sr. Notes: 25,000 11.250% due 2/1/10 (e) 3,438 25,000 11.500% due 2/1/10 (e) 3,438 25,000 Vanguard Health Systems, Sr. Sub. Notes, 9.750% due 8/1/11 25,375 25,000 Venetian Casino Resort LLC/Las Vegas Sands, Inc., Secured Notes, 11.000% due 6/15/10 27,563 50,000 Viacom Inc., Sr. Notes, 6.625% due 5/15/11 57,692 25,000 Vicar Operating Inc., Sr. Notes, 9.875% due 12/1/09 27,750 Vintage Petroleum, Inc., Sr. Sub. Notes: 25,000 9.750% due 6/30/09 26,875 25,000 7.875% due 5/15/11 25,781 200,000 Washington Mutual Finance Corp., Sr. Notes, 6.875% due 5/15/11 (b) 230,746 50,000 Western Gas Resources, Inc., Sr. Sub. Notes, 10.000% due 6/15/09 54,750 25,000 Westport Resources Corp., Sr. Sub. Notes, 8.250% due 11/1/11 27,375
See Notes to Financial Statements. 12 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT+ SECURITY VALUE -------------------------------------------------------------------------------------------- United States -- 58.7% (continued) The Williams Cos., Inc.: 50,000 Bonds, 8.750% due 3/15/32 (a) $ 49,000 Notes: 25,000 7.625% due 7/15/19 22,750 50,000 Series A, 6.750% due 1/15/06 48,500 25,000 Winsloew Furniture Inc., Sr. Sub. Notes, Series B, 12.750% due 8/15/07 16,406 85,000 World Color Press, Inc., Sr. Sub. Notes, 8.375% due 11/15/08 88,965 75,000 Yell Finance BV, Sr. Notes, 10.750% due 8/1/11 84,375 -------------------------------------------------------------------------------------------- 17,904,923 -------------------------------------------------------------------------------------------- TOTAL BONDS AND NOTES (Cost -- $22,823,869) 24,236,554 -------------------------------------------------------------------------------------------- SHARES SECURITY VALUE -------------------------------------------------------------------------------------------- COMMON STOCK (f) -- 0.1% 644 NTL Inc. 10,948 323 Pillowtex Corp. 61 524 SpectraSite, Inc. 18,602 -------------------------------------------------------------------------------------------- TOTAL COMMON STOCK (Cost -- $352,363) 29,611 -------------------------------------------------------------------------------------------- PREFERRED STOCK -- 0.2% CSC Holdings Inc.: 500 Series H, 11.750% due 10/1/07 52,500 150 Series M, 11.125% due 4/1/08 15,712 -------------------------------------------------------------------------------------------- TOTAL PREFERRED STOCK (Cost -- $63,375) 68,212 -------------------------------------------------------------------------------------------- WARRANTS SECURITY VALUE -------------------------------------------------------------------------------------------- WARRANTS (f) -- 0.0% 15 American Tower Corp., Expire 8/1/08 1,132 1,701 Pillowtex Corp., Expire 11/24/09 51 200 Republic Technologies International, LLC, Expire 7/15/09 2 200 Winsloew Furniture Inc., Expire 8/15/07 100 -------------------------------------------------------------------------------------------- TOTAL WARRANTS (Cost -- $4,367) 1,285 -------------------------------------------------------------------------------------------- SUB-TOTAL INVESTMENTS (Cost -- $23,243,974) 24,335,662 --------------------------------------------------------------------------------------------
See Notes to Financial Statements. 13 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders SCHEDULES OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2003 SALOMON BROTHERS STRATEGIC TOTAL RETURN BOND PORTFOLIO
FACE AMOUNT SECURITY VALUE -------------------------------------------------------------------------------------------- REPURCHASE AGREEMENTS -- 20.3% $ 558,000 Goldman, Sachs & Co., 1.250% due 5/1/03; Proceeds at maturity -- $558,019; (Fully collateralized by U.S. Treasury Bills, Notes and Bonds, 0.000% to 4.000% due 5/8/03 to 11/15/12; Market value -- $569,162) $ 558,000 5,614,000 Merrill Lynch & Co., Inc., 1.250% due 5/1/03; Proceeds at maturity -- $5,614,195; (Fully collateralized by various U.S. government agency obligations, 0.000% to 4.875% due 5/9/03 to 11/15/07; Market value -- $5,726,296) 5,614,000 -------------------------------------------------------------------------------------------- TOTAL REPURCHASE AGREEMENTS (Cost -- $6,172,000) 6,172,000 -------------------------------------------------------------------------------------------- TOTAL INVESTMENTS -- 100% (Cost -- $29,415,974*) $30,507,662 --------------------------------------------------------------------------------------------
(a) Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. (b) All or a portion of this security has been segregated for "to-be-announced" trades (See Note 8). (c) Convertible bonds exchangeable for shares of common stock. (d) Security is issued on a "to-be-announced" basis (See Note 8). (e) Security is currently in default. (f) Non-income producing security. + Face amount denominated in U.S. dollars unless otherwise indicated. * Aggregate cost for Federal income tax purposes is substantially the same. Abbreviations used in this schedule: EUR -- Euro FLIRB -- Front Loaded Interest Reduction Bond
See Notes to Financial Statements. 14 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED) APRIL 30, 2003
Smith Barney Salomon Brothers International Strategic Total All Cap Growth Return Bond Portfolio Portfolio ------------------------------------------------------------------------------------------- ASSETS: Investments, at value (Cost -- $174,371,114 and $23,243,974, respectively) $160,206,817 $24,335,662 Repurchase agreements, at value (Cost -- $6,172,000) -- 6,172,000 Loaned securities collateral, at value (Cost -- $19,471,898) (Note 6) 19,471,898 -- Foreign currency, at value (Cost -- $239,201) 239,576 -- Cash -- 622 Receivable for securities sold 1,334,518 252,273 Dividends and interest receivable 879,025 357,321 Receivable for Fund shares sold 742,778 -- Receivable for open forward foreign currency contracts (Note 4) -- 21,315 Other assets 23,854 -- ------------------------------------------------------------------------------------------ Total Assets 182,898,466 31,139,193 ------------------------------------------------------------------------------------------ LIABILITIES: Payable for securities on loan (Note 6) 19,471,898 -- Bank overdraft 2,455,909 -- Payable for Fund shares purchased 1,751,927 28,828 Management fees payable 111,087 18,712 Payable for open forward foreign currency contracts (Note 4) 14,521 -- Payable for securities purchased -- 6,472,638 Accrued expenses 118,826 20,722 ------------------------------------------------------------------------------------------ Total Liabilities 23,924,168 6,540,900 ------------------------------------------------------------------------------------------ Total Net Assets $158,974,298 $24,598,293 ------------------------------------------------------------------------------------------ NET ASSETS: Par value of capital shares $ 181 $ 23 Capital paid in excess of par value 245,032,726 25,867,533 Undistributed net investment income 966,120 414,468 Accumulated net realized loss from security transactions (72,890,348) (2,781,856) Net unrealized appreciation (depreciation) of investments and foreign currencies (14,134,381) 1,098,125 ------------------------------------------------------------------------------------------ Total Net Assets $158,974,298 $24,598,293 ------------------------------------------------------------------------------------------ Shares Outstanding 18,067,737 2,286,116 ------------------------------------------------------------------------------------------ Net Asset Value $8.80 $10.76 ------------------------------------------------------------------------------------------
See Notes to Financial Statements. 15 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders STATEMENTS OF OPERATIONS (UNAUDITED) For the Six Months Ended April 30, 2003
Smith Barney Salomon Brothers International Strategic Total All Cap Growth Return Bond Portfolio Portfolio -------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ 2,073,624 $ 2,203 Interest 35,132 722,062 Less: Foreign withholding tax (243,499) -- ------------------------------------------------------------------------------------------ Total Investment Income 1,865,257 724,265 ------------------------------------------------------------------------------------------ EXPENSES: Management fees (Note 2) 738,008 89,258 Custody 53,035 18,692 Shareholder communications 23,328 4,094 Audit and legal 17,303 11,672 Shareholder servicing fees 4,827 2,482 Directors' fees 3,614 1,224 Other 3,713 1,278 ------------------------------------------------------------------------------------------ Total Expenses 843,828 128,700 ------------------------------------------------------------------------------------------ Net Investment Income 1,021,429 595,565 ------------------------------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCIES (NOTES 3 AND 4): Realized Gain (Loss) From: Security transactions (excluding short-term securities) (8,524,879) 256,331 Foreign currency transactions (22,234) -- ------------------------------------------------------------------------------------------ Net Realized Gain (Loss) (8,547,113) 256,331 ------------------------------------------------------------------------------------------ Change in Net Unrealized Appreciation (Depreciation) From: Security transactions 9,269,963 1,632,814 Foreign currency transactions 20,050 6,437 ------------------------------------------------------------------------------------------ Change in Net Unrealized Appreciation (Depreciation) 9,290,013 1,639,251 ------------------------------------------------------------------------------------------ Net Gain on Investments and Foreign Currencies 742,900 1,895,582 ------------------------------------------------------------------------------------------ Increase in Net Assets From Operations $ 1,764,329 $2,491,147 ------------------------------------------------------------------------------------------
See Notes to Financial Statements. 16 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders STATEMENTS OF CHANGES IN NET ASSETS For the Six Months Ended April 30, 2003 (unaudited) and the Year Ended October 31, 2002 Smith Barney International All Cap Growth Portfolio 2003 2002 ------------------------------------------------------------------------------- OPERATIONS: Net investment income $ 1,021,429 $ 951,109 Net realized loss (8,547,113) (13,651,037) (Increase) decrease in net unrealized depreciation 9,290,013 (30,620,765) ------------------------------------------------------------------------------ Increase (Decrease) in Net Assets From Operations 1,764,329 (43,320,693) ------------------------------------------------------------------------------ DISTRIBUTIONS TO SHAREHOLDERS FROM: Net investment income (947,561) (1,049,300) ------------------------------------------------------------------------------ Decrease in Net Assets From Distributions to Shareholders (947,561) (1,049,300) ------------------------------------------------------------------------------ FUND SHARE TRANSACTIONS (NOTE 9): Net proceeds from sale of shares 172,442,514 604,439,911 Net asset value of shares issued for reinvestment of dividends 947,561 1,049,300 Cost of shares reacquired (185,299,523) (634,627,288) ------------------------------------------------------------------------------ Decrease in Net Assets From Fund Share Transactions (11,909,448) (29,138,077) ------------------------------------------------------------------------------ Decrease in Net Assets (11,092,680) (73,508,070) NET ASSETS: Beginning of period 170,066,978 243,575,048 ------------------------------------------------------------------------------ End of period* $ 158,974,298 $ 170,066,978 ------------------------------------------------------------------------------ * Includes undistributed net investment income of: $966,120 $914,486 ------------------------------------------------------------------------------ See Notes to Financial Statements. 17 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED) For the Six Months Ended April 30, 2003 (unaudited) and the Year Ended October 31, 2002 Salomon Brothers Strategic Total Return Bond Portfolio 2003 2002 ------------------------------------------------------------------------------ OPERATIONS: Net investment income $ 595,565 $ 863,613 Net realized gain 256,331 24,529 Increase (decrease) in net unrealized appreciation 1,639,251 (244,459) ------------------------------------------------------------------------------ Increase in Net Assets From Operations 2,491,147 643,683 ------------------------------------------------------------------------------ DISTRIBUTIONS TO SHAREHOLDERS FROM: Net investment income (1,052,602) (956,847) ------------------------------------------------------------------------------ Decrease in Net Assets From Distributions to Shareholders (1,052,602) (956,847) ------------------------------------------------------------------------------ FUND SHARE TRANSACTIONS (NOTE 9): Net proceeds from sale of shares 4,120,275 10,242,369 Net asset value of shares issued for reinvestment of dividends 1,052,602 956,847 Cost of shares reacquired (3,162,774) (7,554,055) ------------------------------------------------------------------------------ Increase in Net Assets From Fund Share Transactions 2,010,103 3,645,161 ------------------------------------------------------------------------------ Increase in Net Assets 3,448,648 3,331,997 NET ASSETS: Beginning of period 21,149,645 17,817,648 ------------------------------------------------------------------------------ End of period* $24,598,293 $21,149,645 ------------------------------------------------------------------------------ * Includes undistributed net investment income of: $414,468 $871,505 ------------------------------------------------------------------------------ See Notes to Financial Statements. 18 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders NOTES TO FINANCIAL STATEMENTS (UNAUDITED) 1. Significant Accounting Policies The Smith Barney International All Cap Growth Portfolio and Salomon Brothers Strategic Total Return Bond Portfolio, ("Fund(s)") are separate investment funds of the Travelers Series Fund Inc. ("Series"). The Series, a Maryland corporation, is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company and consists of these Funds and twelve other separate investment funds: AIM Capital Appreciation, Alliance Growth, MFS Total Return, Putnam Diversified Income, Smith Barney High Income, Smith Barney Large Cap Value, Smith Barney Money Market, Smith Barney Large Capitalization Growth, Travelers Managed Income, Van Kampen Enterprise, Smith Barney Mid Cap Core and Smith Barney Aggressive Growth Portfolios. Shares of the Series are offered only to insurance company separate accounts which fund certain variable annuity and variable life insurance contracts. The financial statements and financial highlights for the other funds are presented in separate shareholder reports. The significant accounting policies consistently followed by the Funds are: (a) security transactions are accounted for on trade date; (b) securities traded on national securities markets are valued at the closing prices in the primary exchange on which they are traded; securities listed or traded on certain foreign exchanges or other markets whose operations are similar to the U.S. over-the-counter market (including securities listed on exchanges where the primary market is believed to be over-the-counter) and listed securities for which no sales price was reported on that date are valued at the mean between the bid and asked prices. Securities which are listed or traded on more than one exchange or market are valued at the quotations on the exchange or market determined to be the primary market for such securities; (c) securities maturing within 60 days are valued at cost plus accreted discount or minus amortized premium, which approximates value; (d) gains or losses on the sale of securities are calculated by using the specific identification method; (e) interest income, adjusted for amortization of premium and accretion of discount, is recorded on an accrual basis; (f) dividend income is recorded on the ex-dividend date; foreign dividends are recorded on the ex-dividend date or as soon as practical after the Funds determine the existence of a dividend declaration after exercising reasonable due diligence; (g) dividends and distributions to shareholders are recorded on the ex- dividend date; the Funds distribute dividends and capital gains, if any, annually; 19 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) (h) the accounting records of the Funds are maintained in U.S. dollars. All assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the rate of exchange of such currencies against U.S. dollars on the date of valuation. Purchases and sales of securities and income and expenses are translated at the rate of exchange quoted on the respective date that such transactions are recorded. Differences between income or expense amounts recorded and collected or paid are adjusted when reported by the custodian; (i) the character of income and gains to be distributed are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America; (j) each Fund intends to comply with the requirements of the Internal Revenue Code of 1986, as amended pertaining to regulated investment companies and make distributions of taxable income sufficient to relieve it from substantially all Federal income and excise taxes; and (k) estimates and assumptions are required to be made regarding assets, liabilities and changes in net assets resulting from operations when financial statements are prepared. Changes in the economic environment, financial markets and any other parameters used in determining these estimates could cause actual results to differ. In addition, the Funds may enter into forward exchange contracts in order to hedge against foreign currency risk. These contracts are marked to market daily, by recognizing the difference between the contract exchange rate and the current market rate as an unrealized gain or loss. Realized gains or losses are recognized when contracts are settled. In addition, the yields of emerging market debt obligations reflect, among other things, perceived credit risk. The consequences of political, social, economic or diplomatic changes may have disruptive effects on market prices of investments held by the Funds. The Funds' investment in non-dollar-denominated securities may also result in foreign currency losses caused by devaluations and exchange rate fluctuations. 20 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) 2. Management Agreement and Transactions with Affiliated Persons Smith Barney Fund Management LLC ("SBFM"), an indirect wholly-owned subsidiary of Citigroup Inc. ("Citigroup"), acts as investment manager of the Smith Barney International All Cap Growth Portfolio ("SBIACG"). SBIACG pays SBFM a management fee calculated at the annual rate of 0.90% of its average daily net assets. In addition, Travelers Investment Adviser, Inc., ("TIA"), an affiliate of SBFM, acts as the investment manager of the Salomon Brothers Strategic Total Return Bond Portfolio ("SBSTRB"). SBSTRB pays TIA a management fee calculated at an annual rate of 0.80% of its average daily net assets. These fees are calculated daily and paid monthly. TIA has entered into a sub-advisory agreement with Salomon Brothers Asset Management Inc ("SaBAM"), another indirect wholly-owned subsidiary of Citigroup. Pursuant to the sub-advisory agreement, SaBAM is responsible for the day-to-day portfolio operations and investment decisions for SBSTRB and is compensated for such services. TIA pays SaBAM a monthly fee calculated at an annual rate of 0.375% of the average daily net assets of SBSTRB. Citicorp Trust Bank, fsb. ("CTB"), another subsidiary of Citigroup, acts as the Funds' transfer agent and PFPC Global Fund Services ("PFPC") acts as the Funds' sub-transfer agent. CTB receives account fees and asset-based fees that vary according to the size and type of account. PFPC is responsible for shareholder recordkeeping and financial processing for all shareholder accounts and is paid by CTB. For the six months ended April 30, 2003, each Fund paid transfer agent fees of $2,500 to CTB. During the six months ended April 30, 2003, Citigroup Global Markets Inc., formerly known as Salomon Smith Barney Inc., another indirect wholly-owned subsidiary of Citigroup, did not receive any brokerage commissions from SBIACG. Most of the officers and one Director of the Series are employees of Citigroup or its affiliates. 21 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) 3. Investments For the six months ended April 30, 2003, the aggregate cost of purchases and proceeds from sales of investments (including maturities of long-term securities, but excluding short-term securities) were as follows:
SBIACG SBSTRB -------------------------------------------------------------------------- Purchases $20,920,625 $39,614,452 -------------------------------------------------------------------------- Sales 32,476,862 37,794,856 --------------------------------------------------------------------------
At April 30, 2003, the gross unrealized appreciation and depreciation of investments for Federal income tax purposes were substantially as follows:
SBIACG SBSTRB ------------------------------------------------------------------------- Gross unrealized appreciation $ 15,882,913 $1,791,203 Gross unrealized depreciation (30,047,210) (699,515) ------------------------------------------------------------------------- Net unrealized appreciation (depreciation) $(14,164,297) $1,091,688 -------------------------------------------------------------------------
4. Forward Foreign Currency Contracts A forward foreign currency contract is an agreement between two parties to buy and sell a currency at a set price on a future date. The contract is marked-to-market daily and the change in value is recorded by the Funds as an unrealized gain or loss. When a forward foreign currency contract is extinguished, through either delivery or offset by entering into another forward foreign currency contract, the Funds record a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value of the contract at the time it was extinguished or offset. The Funds bear the market risk that arises from changes in foreign currency exchange rates and the credit risk should a counterparty be unable to meet the terms of such contracts. At April 30, 2003, the Funds had open forward foreign currency contracts as described below. The unrealized gain (loss) on the open contracts is reflected in the accompanying financial statements as follows:
Smith Barney International All Cap Growth Portfolio Local Market Settlement Unrealized Foreign Currency Currency Value Date Loss ------------------------------------------------------------------------- To Sell: Japanese Yen 158,914,434 $1,334,518 5/1/03 $(14,521) -------------------------------------------------------------------------
22 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
Salomon Brothers Strategic Total Return Bond Portfolio Local Market Settlement Unrealized Foreign Currency Currency Value Date Gain ----------------------------------------------------------- To Buy: Euro 1,075,950 $1,203,020 5/2/03 $21,315 -----------------------------------------------------------
5. Repurchase Agreements The Funds purchase (and their custodian takes possession of) U.S. government securities from securities dealers subject to agreements to resell the securities to the sellers at a future date (generally, the next business day) at an agreed-upon higher repurchase price. The Funds require continual maintenance of the market value of the collateral (plus accrued interest) in amounts at least equal to the repurchase price. 6. Lending of Portfolio Securities The Funds have an agreement with their custodian whereby the custodian may lend securities owned by the Funds to brokers, dealers and other financial organizations. Fees earned by the Funds on securities lending are recorded as interest income. Loans of securities by the Funds are collateralized by cash, U.S. government securities, high quality money market instruments or other securities that are maintained at all times in an amount at least equal to the current market value of the loaned securities, plus a margin which may vary depending on the type of securities loaned. The custodian establishes and maintains the collateral in segregated accounts. The Funds maintain exposure for the risk of any loss in the investment of amounts received as collateral. At April 30, 2003, SBIACG loaned common stocks having a market value of $18,818,937. SBIACG received cash collateral amounting to $19,471,898 which was invested in the State Street Navigator Securities Lending Trust Prime Portfolio. In addition to the cash collateral, SBIACG held securities collateral amounting to $108,052. Income earned by SBIACG from securities loaned for the six months ended April 30, 2003, was $24,389. At April 30, 2003, SBSTRB did not have any securities on loan. 23 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) 7. Portfolio Concentration The Funds' investments in foreign securities may involve risks not present in domestic investments. Since securities may be denominated in a foreign currency and may require settlement in foreign currencies and pay interest or dividends in foreign currencies, changes in the relationship of these foreign currencies to the U.S. dollar can significantly affect the value of the investments and earnings of the Funds. Foreign investments may also subject the Funds to foreign government exchange restrictions, expropriation, taxation or other political, social or economic developments, all of which could affect the market and/or credit risk of the investments. In addition to the risks described above, risks may arise from forward foreign currency contracts with respect to the potential inability of counter-parties to meet the terms of their contracts. 8. Securities Traded on a To-Be-Announced Basis The Funds may trade securities on a "to-be-announced" ("TBA") basis. In a TBA transaction, the Funds commit to purchasing or selling securities for which specific information is not yet known at the time of the trade, particularly the face amount and maturity date in GNMA transactions. Securities purchased on a TBA basis are not settled until they are delivered to the Funds, normally 15 to 45 days later. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other securities. At April 30, 2003, SBSTRB held TBA securities with a total cost of $4,960,938 and SBIACG did not hold any TBA securities. 9. Capital Shares At April 30, 2003, the Series had six billion shares of capital stock authorized with a par value of $0.00001 per share. Each share of a Fund represents an equal proportionate interest in that Fund with each share of the same Fund and has an equal entitlement to any dividends and distributions made by the Fund. 24 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) Transactions in shares of each Fund were as follows:
Six Months Ended Year Ended April 30, 2003 October 31, 2002 ------------------------------------------------------------------------------- Smith Barney International All Cap Growth Portfolio Shares sold 20,040,489 57,913,258 Shares issued on reinvestment 108,915 121,870 Shares reacquired (21,445,348) (60,467,175) ------------------------------------------------------------------------------- Net Decrease (1,295,944) (2,432,047) ------------------------------------------------------------------------------- Salomon Brothers Strategic Total Return Bond Portfolio Shares sold 401,481 986,807 Shares issued on reinvestment 105,155 95,020 Shares reacquired (307,640) (730,344) ------------------------------------------------------------------------------- Net Increase 198,996 351,483 -------------------------------------------------------------------------------
25 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders FINANCIAL HIGHLIGHTS For a share of capital stock outstanding throughout each year ended October 31, unless otherwise noted:
Smith Barney International All Cap Growth Portfolio 2003/(1)(2)/ 2002/(2)/ 2001/(2)/ 2000/(2)/ 1999 1998 ----------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $8.78 $11.18 $18.52 $16.92 $12.60 $13.23 ----------------------------------------------------------------------------------------------- Income (Loss) From Operations: Net investment income 0.05 0.04 0.05 0.02 0.02 0.05 Net realized and unrealized gain (loss) 0.02 (2.39) (7.39) 1.71 4.35 (0.68) ----------------------------------------------------------------------------------------------- Total Income (Loss) From Operations 0.07 (2.35) (7.34) 1.73 4.37 (0.63) ----------------------------------------------------------------------------------------------- Less Distributions From: Net investment income (0.05) (0.05) -- (0.13) (0.05) -- ----------------------------------------------------------------------------------------------- Total Distributions (0.05) (0.05) -- (0.13) (0.05) -- ----------------------------------------------------------------------------------------------- Net Asset Value, End of Period $8.80 $ 8.78 $11.18 $18.52 $16.92 $12.60 ----------------------------------------------------------------------------------------------- Total Return 0.78%++ (20.97)% (39.63)% 10.18% 34.73% (4.76)% ----------------------------------------------------------------------------------------------- Net Assets, End of Period (millions) $159 $170 $244 $462 $309 $224 ----------------------------------------------------------------------------------------------- Ratios to Average Net Assets: Expenses 1.03%+ 1.00% 1.00% 0.98% 1.00% 1.00% Net investment income 1.25+ 0.42 0.31 0.11 0.16 0.37 ----------------------------------------------------------------------------------------------- Portfolio Turnover Rate 13% 27% 22% 15% 36% 34% -----------------------------------------------------------------------------------------------
(1) For the six months ended April 30, 2003 (unaudited). (2) Per share amounts have been calculated using the monthly average shares method. ++ Total return is not annualized, as it may not be representative of the total return for the year. + Annualized. 26 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders FINANCIAL HIGHLIGHTS (CONTINUED) For a share of capital stock outstanding throughout each year ended October 31, unless otherwise noted:
Salomon Brothers Strategic Total Return Bond Portfolio 2003/(1)/ 2002/(2)/ 2001/(2)/ 2000/(2)/ 1999 1998 ---------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.13 $10.27 $ 9.89 $10.22 $10.97 $12.52 ------------------------------------------------------------------------------------------- Income (Loss) From Operations: Net investment income/(3)/ 0.27 0.51 0.58 0.81 0.75 0.84 Net realized and unrealized gain (loss)/(3)/ 0.86 (0.17) 0.48 (0.37) (0.85) (1.09) ------------------------------------------------------------------------------------------- Total Income (Loss) From Operations 1.13 0.34 1.06 0.44 (0.10) (0.25) ------------------------------------------------------------------------------------------- Less Distributions From: Net investment income (0.50) (0.48) (0.68) (0.77) (0.65) (0.66) Net realized gains -- -- -- -- -- (0.64) ------------------------------------------------------------------------------------------- Total Distributions (0.50) (0.48) (0.68) (0.77) (0.65) (1.30) ------------------------------------------------------------------------------------------- Net Asset Value, End of Period $10.76 $10.13 $10.27 $ 9.89 $10.22 $10.97 ------------------------------------------------------------------------------------------- Total Return 11.57%++ 3.36% 10.99% 4.34% (0.96)% (2.50)% ------------------------------------------------------------------------------------------- Net Assets, End of Period (millions) $25 $21 $18 $20 $23 $28 ------------------------------------------------------------------------------------------- Ratios to Average Net Assets: Expenses 1.15%+ 1.24% 1.23% 0.98% 1.13% 1.03% Net investment income/(3)/ 5.34+ 4.95 5.69 7.93 6.43 7.31 ------------------------------------------------------------------------------------------- Portfolio Turnover Rate 171% 385% 448% 54% 135% 280% -------------------------------------------------------------------------------------------
(1) For the six months ended April 30, 2003 (unaudited). (2) Per share amounts have been calculated using the monthly average shares method. (3) Effective November 1, 2001, the Fund adopted a change in the accounting method that requires the Fund to amortize premiums and accrete all discounts. Without the adoption of this change, for the year ended October 31, 2002, net investment income, net realized and unrealized loss and the ratio of net investment income to average net assets would have been $0.52, $0.18 and 5.04%, respectively. Per share, ratios and supplemental data for the periods prior to November 1, 2001 have not been restated to reflect this change in presentation. ++ Total return is not annualized, as it may not be representative of the total return for the year. + Annualized. 27 Travelers Series Fund Inc. | 2003 Semi-Annual Report to Shareholders TRAVELERS SERIES FUND INC. DIRECTORS INVESTMENT MANAGERS A.E. Cohen Smith Barney Fund Robert A. Frankel Management LLC Michael E. Gellert Travelers Investment Adviser, Inc. R. Jay Gerken, Chairman CUSTODIAN Rainer Greeven State Street Bank and Susan M. Heilbron Trust Company OFFICERS ANNUITY R. Jay Gerken ADMINISTRATION President and Travelers Annuity Investor Services Chief Executive Officer 5 State House Square 1 Tower Square Lewis E. Daidone Hartford, Connecticut 06183 Senior Vice President and Chief Administrative Officer Richard L. Peteka Chief Financial Officer and Treasurer Jeffrey J. Russell Vice President and Investment Officer Peter J. Wilby, CFA Vice President and Investment Officer Kaprel Ozsolak Controller Christina T. Sydor Secretary Travelers Series Fund Inc. This report is submitted for the general information of the shareholders of Travelers Series Fund Inc. -- Smith Barney International All Cap Growth and Salomon Brothers Strategic Total Return Bond Portfolios. It is not authorized for distribution to prospective investors unless accompanied or preceded by a current Prospectus for the Funds, which contains information concerning the Funds' investment policies and expenses as well as other pertinent information. TRAVELERS SERIES FUND INC. 125 Broad Street 10th Floor, MF-2 New York, New York 10004 IN0802 6/03 03-4964 ITEM 2. CODE OF ETHICS. Not applicable. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. Not applicable. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Not applicable. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable. ITEM 6. [RESERVED] ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 8. [RESERVED] ITEM 9. CONTROLS AND PROCEDURES. (a) The registrant's principal executive officer and principal financial officer have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940, as amended) are effective based on their evaluation of the disclosure controls and procedures as of a date within 90 days of the filing date of this document. (b) In the last 90 days, there have been no significant changes in the Registrant's internal controls or in other factors that could significantly affect these controls. ITEM 10. EXHIBITS. (a) Not applicable. (b) Attached hereto. Exhibit 99.CERT Certifications pursuant to section 302 of the Sarbanes-Oxley Act of 2002 Exhibit 99.906CERT Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this Report to be signed on its behalf by the undersigned, there unto duly authorized. Travelers Series Fund Inc. By: /s/ R. Jay Gerken R. Jay Gerken Chief Executive Officer of Travelers Series Fund Inc. Date: June 27, 2003 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ R. Jay Gerken (R. Jay Gerken) Chief Executive Officer of Travelers Series Fund Inc. Date: June 27, 2003 By: /s/ RICHARD PETEKA Chief Financial Officer of Travelers Series Fund Inc. Date: June 27, 2003