Form N-Q 9-30-04

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 811-0266

Tri-Continental Corporation
(Exact name of Registrant as specified in charter)

     100 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip code)

Lawrence P. Vogel
100 Park Avenue
New York, New York 10017
(Name and address of agent for service)

Registrant’s telephone number, including area code: (212) 850-1864

Date of fiscal year end: 12/31
   
Date of reporting period: 9/30/04

 

FORM N-Q

ITEM 1. SCHEDULE OF INVESTMENTS.

Tri-Continental Corporation

Schedule of Investments (unaudited)
September 30, 2004
       
Shares or    
 
Principal Amount
 
Value
 
 
COMMON STOCKS 96.3%          
AEROSPACE AND DEFENSE 2.1%          
General Dynamics Corporation 261,000   shs.   $ 26,648,100
L-3 Communications Holdings, Inc.* 338,100       22,652,700
       
        49,300,800
       
AUTO COMPONENTS 0.9%          
Lear Corp. 379,400       20,658,330
       
BEVERAGES 2.7%          
Coca-Cola Company (The) 793,300       31,771,665
PepsiCo, Inc. 610,200       29,686,230
       
        61,457,895
       
BIOTECHNOLOGY 1.4%          
Amgen Inc.* 289,100       16,419,435
Gilead Sciences, Inc.* 185,800       6,944,275
MedImmune, Inc.* 405,700       9,609,004
       
        32,972,714
       
BUILDING PRODUCTS 0.8%          
Masco Corporation 514,100       17,751,873
       
CAPITAL MARKETS 2.1%          
Bank of New York Company, Inc. (The) 566,100       16,513,137
Goldman Sachs Group, Inc. (The) 107,100       9,986,004
Merrill Lynch & Co. Inc. 218,600       10,868,792
Morgan Stanley 247,370       12,195,341
       
        49,563,274
       
CHEMICALS 2.1%          
Dow Chemical Co. (The) 446,100       20,154,798
Praxair, Inc. 675,600       28,875,144
       
        49,029,942
       
COMMERCIAL BANKS 3.5%          
Bank of America Corporation 417,040       18,070,343
U.S. Bancorp 835,630       24,149,707
Wachovia Corporation 536,463       25,186,938
Wells Fargo & Company 209,800       12,510,374
       
        79,917,362
       
COMMERCIAL SERVICES AND SUPPLIES 1.7%          
ServiceMaster Company (The) 1,838,600       23,644,396
Waste Management, Inc. 556,600       15,217,444
       
        38,861,840
       
COMMUNICATIONS EQUIPMENT 2.7%          
Andrew Corporation*
1,602,600
19,607,811
Cisco Systems, Inc.*
1,569,780
 
28,342,378
QUALCOMM Inc.
363,400
 
14,185,319
       
         
62,135,508
       
COMPUTERS AND PERIPHERALS 4.8%          
Dell Inc.* 891,960       31,709,178
EMC Corporation* 2,086,000       24,072,440
Hewlett-Packard Company 710,130       13,314,937
International Business Machines Corporation 500,020       42,871,715
       
          111,968,270
       
CONSUMER FINANCE 1.8%          
American Express Company 296,330       15,249,142
Capital One Financial Corporation 128,900       9,525,710
MBNA Corporation 651,500       16,417,800
       
          41,192,652
       
DIVERSIFIED FINANCIAL SERVICES 3.8%          
Citigroup Inc. 1,443,430       63,684,132
J.P. Morgan Chase & Co. 616,500       24,493,545
       
          88,177,677
       
DIVERSIFIED TELECOMMUNICATION SERVICES 2.0%          
SBC Communications Inc. 371,500       9,640,425
Verizon Communications Inc. 948,800       37,363,744
       
          47,004,169
       
ELECTRONIC EQUIPMENT AND INSTRUMENTS 0.5%          
Jabil Circuit, Inc.* 530,040       12,190,920
       
ENERGY EQUIPMENT AND SERVICES 0.8%          
Noble Corporation* 186,300       8,374,185
Rowan Companies, Inc.* 384,900       10,161,360
       
          18,535,545
       
FOOD AND STAPLE RETAILING 2.8%          
Kroger Company (The)* 966,700       15,003,184
Sysco Corporation 305,000       9,125,600
Wal-Mart Stores, Inc. 771,820       41,060,824
       
          65,189,608
       
FOOD PRODUCTS 0.7%          
Dean Foods Company* 565,100       16,964,302
       
HEALTH CARE PROVIDERS AND SERVICES 2.1%          
Aetna Inc. 236,200       23,603,466
Andrx Corp.* 452,800       10,113,288
Anthem, Inc.* 84,400       7,363,900
Laboratory Corporation          
of America Holdings* 161,900       7,078,268
       
        48,158,922
       
HOTELS, RESTAURANTS AND LEISURE 1.9%          
Carnival Corporation 629,500       29,769,055
Marriott International,          
Inc. Class “A” 292,400       15,193,104
       
        44,962,159
       
HOUSEHOLD DURABLES 0.4%          
Pulte Homes, Inc. 156,100       9,579,857
       
HOUSEHOLD PRODUCTS 1.7%          
Colgate-Palmolive Company 179,100       8,091,738
Procter & Gamble Company (The) 582,112       31,503,901
       
        39,595,639
       
INDEX DERIVATIVES 0.8%          
SPDR Trust, Series 1 158,800       17,747,488
       
INDUSTRIAL CONGLOMERATES 5.6%          
General Electric Company 2,679,750       89,986,005
Tyco International Ltd. 1,281,040       39,276,686
       
        129,262,691
       
INSURANCE 5.2%          
American International Group, Inc. 704,700       47,912,553
Hartford Financial Services Group, Inc. 212,400       13,153,932
PartnerRe Ltd. 219,700       12,015,393
Prudential Financial, Inc. 782,400       36,804,096
XL Capital Ltd. Class “A” 149,700       11,076,303
       
        120,962,277
       
INTERNET AND CATALOG RETAIL 0.6%          
eBay Inc.* 147,560       13,570,355
       
MACHINERY 2.0%          
Deere & Company
259,000
  
16,718,450
Illinois Tool Works Inc.
318,980
  
29,719,367
       
         
46,437,817
       
MEDIA 3.1%          
Clear Channel          
Communications, Inc. 545,200       16,993,884
Time Warner Inc.* 1,727,000       27,873,780
Tribune Company 347,700       14,307,855
Univision Communications Inc. Class “A”* 373,300       11,800,013
       
          70,975,532
       
METALS AND MINING 0.7%          
Freeport-McMoRan Copper & Gold, Inc. Class “B” 381,600       15,454,800
       
MULTI-LINE RETAIL 0.7%          
Target Corp. 372,300       16,846,575
       
MULTI-UTILITIES AND UNREGULATED POWER 0.9%          
     
Dominion Resources, Inc. 72,600       4,737,150
Duke Energy Corporation 744,700       17,046,183
       
          21,783,333
       
OIL AND GAS 7.8%          
BP p.l.c. (ADR) (United Kingdom) 219,800       12,645,094
ChevronTexaco Corporation 504,200       27,045,288
ConocoPhillips 399,403       33,090,539
Exxon Mobil Corporation 1,531,825       74,033,102
Noble Energy, Inc. 294,680       17,162,163
Occidental Petroleum Corporation 304,200       7,013,906
       
          180,990,092
       
PAPER AND FOREST PRODUCTS 0.5%          
Weyerhaeuser Company 189,020       12,566,050
       
PHARMACEUTICALS 8.1%          
Abbott Laboratories 586,900       24,861,084
Forest Laboratories, Inc.* 209,500       9,423,310
Johnson & Johnson 541,263       30,489,345
Novartis (ADR) (Switzerland) 851,500       39,739,505
Pfizer Inc. 1,915,038       58,600,163
Watson Pharmaceuticals, Inc.* 332,500       9,795,450
Wyeth 414,300       15,494,820
       
          188,403,677
       
REAL ESTATE 0.8%        
Apartment Investment & Management Company Class “A” 501,600       17,445,648
       
SEMICONDUCTORS AND SEMICONDUCTOR EQUIPMENT 1.7%          
Intel Corporation 1,177,590       23,598,904
Taiwan Semiconductor Manufacturing Company Ltd. (ADR) (Taiwan) 2,136,501       15,254,617
       
          38,853,521
       
SOFTWARE 6.4%          
Computer Associates International, Inc. 1,177,900       30,978,770
Microsoft Corporation 2,683,956       74,197,964
Oracle Corporation* 561,100       6,337,624
Symantec Corporation* 571,900       31,417,326
Synopsys, Inc.* 366,900       5,791,517
       
          148,723,201
       
SPECIALTY RETAIL 2.0%          
Advance Auto Parts, Inc.* 247,700       8,520,880
Michaels Stores, Inc. 461,700       27,337,257
Tiffany & Co. 327,600       10,070,424
       
          45,928,561
       
THRIFTS AND MORTGAGE FINANCE 1.9%          
Fannie Mae 257,500       16,325,500
Freddie Mac 223,700       14,594,188
Radian Group Inc. 285,800       13,212,534
       
          44,132,222
       
TOBACCO 2.0%          
Altria Group, Inc. 988,480       46,498,099
       
WIRELESS TELECOMMUNICATION SERVICES 2.2%          
American Tower Corporation Class “A”* 1,624,000       24,928,400
Crown Castle International Corp.* 1,754,900       26,112,912
       
          51,041,312
       
           
TOTAL COMMON STOCKS         2,232,792,509
       
           
TRI-CONTINENTAL FINANCIAL DIVISION 0.2%          
WCAS Capital Partners II, L.P.† $  4,727,686       2,566,803
       
Whitney Subordinated Debt Fund, L.P.† 2,464,665       1,177,949
       
           
TOTAL TRI-CONTINENTAL FINANCIAL DIVISION         3,744,752
       
FIXED TIME DEPOSITS 2.6%          
           
Rabobank Nederland, 1.87%, 10/1/04 61,432,000       61,432,000
       
           
TOTAL INVESTMENTS 99.1%       2,297,969,261
           
OTHER ASSETS LESS LIABILITIES 0.9%         20,000,041
       
           
NET INVESTMENT ASSETS 100.0%      
$
 2,317,969,302
       
* Non-income producing security.
   
† Restricted Securities – At September 30, 2004, the Tri-Continental Financial Division of the Corporation comprised two investments that were purchased through private offerings and cannot be sold without prior registration under the Securities Act of 1933 or pursuant to an exemption therefrom. These investments are valued at fair value as determined in accordance with procedures approved by the Board of Directors of the Corporation. The acquisition dates of investments in the limited partnerships along with their cost and values at September 30, 2004, were as follows:
             
Investments   Acquisition Date (s)  
Cost
 
Value
 
 
WCAS Capital Partners II, L.P.   12/11/90 to 3/24/98  
$
4,727,686
$
2,568,316
Whitney Subordinated Debt Fund, L.P   7/12/89 to 11/10/98  
2,464,665
1,179,492
       
Total      
$
7,192,351
$
3,747,808
       
 

ADR - American Depositary Receipt

The cost of investments for federal income tax purposes was $2,146,638,222. The tax basis gross unrealized appreciation and depreciation of portfolio securities were $255,190,615 and $103,859,576, respectively. Net appreciation was $151,331,039.

Security Valuation - Securities traded on an exchange are valued at the last sales price on the primary exchange or market on which they are traded. Securities not listed on an exchange or security market, or securities for which there is no last sales price, are valued at the mean of the most recent bid and asked prices or are valued by J. & W. Seligman & Co. Incorporated based on quotations provided by primary market makers in such securities. Securities for which market quotations are not readily available are valued at fair value determined in accordance with procedures approved by the Board of Directors. This can occur in the event of, among other things, natural disasters, acts of terrorism, market disruptions, intra-day trading halts, and extreme market volatility in the US markets. Short-term holdings that mature in more than 60 days are valued at current market quotations. Short-term holdings maturing in 60 days or less are valued at amortized cost.

 

ITEM 2. CONTROLS AND PROCEDURES.
     
  a.
 The registrant's principal executive officer and principal financial officer have concluded, based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this report, that these disclosure controls and procedures provide reasonable assurance that material information required to be disclosed by the registrant in the report it files or submits on Form N-Q is recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms and that such material information is accumulated and communicated to the registrant's management, including its principal executive officer and principal financial officer, as appropriate, in order to allow timely decisions regarding required disclosure.
     
  b.
 The registrant’s principal executive officer and principal financial officer are aware of no changes in the registrant’s internal control over financial reporting that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
 
ITEM 3. EXHIBITS.
     
  (a)
 Certifications of principal executive officer and principal financial officer 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.

TRI-CONTINENTAL CORPORATION

By:
/s/ BRIAN T. ZINO
  
 
 
  Brian T. Zino  
  President and Chief Executive Officer  
     
Date: November 24, 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 in the capacities and on the dates indicated.

By:
/s/ BRIAN T. ZINO
  
 
 
  Brian T. Zino  
  President and Chief Executive Officer  
     
Date: November 24, 2004  
     
By:
/s/ LAWRENCE P. VOGEL
  
 
 
  Lawrence P. Vogel  
  Vice President, Treasurer and Chief Financial Officer  
     
Date: November 24, 2004  

 

 

TRI-CONTINENTAL CORPORATION

EXHIBIT INDEX

(a) Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940.