UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
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Investment Company Act file number 811-4058
The Korea Fund, Inc.
(Exact name of registrant as specified in charter)
345 Park Avenue
New York, NY 10154
(Address of principal executive offices) (Zip code)
Paul Schubert
345 Park Avenue
New York, NY 10154
(Name and address of agent for service)
Registrant's telephone number, including area code: (212) 454-7190
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Date of fiscal year end: 06/30
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Date of reporting period: 9/30/05
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Form N-Q is to be used by registered management investment companies, other than
small business investment companies registered on Form N-5 (ss.ss. 239.24 and
274.5 of this chapter), to file reports with the Commission, not later than 60
days after the close of the first and third fiscal quarters, pursuant to rule
30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-4). The
Commission may use the information provided on Form N-Q in its regulatory,
disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-Q, and
the Commission will make this information public. A registrant is not required
to respond to the collection of information contained in Form N-Q unless the
Form displays a currently valid Office of Management and Budget ("OMB") control
number. Please direct comments concerning the accuracy of the information
collection burden estimate and any suggestions for reducing the burden to the
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington,
DC 20549-0609. The OMB has reviewed this collection of information under the
clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. SCHEDULE OF INVESTMENTS
Investment Portfolio as of September 30, 2005 (Unaudited)
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The Korea Fund, Inc.
Shares Value ($)
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Common Stocks 81.2%
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Consumer Discretionary 12.1%
Auto Components 6.6%
Hankook Tire Co., Ltd. 3,021,893 39,963,702
Hyundai Mobis 237,242 19,484,082
Nexen Tire Corp. 270,761 6,499,821
Samsung Climate Control Co., Ltd. (a) 560,224 3,527,237
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69,474,842
Hotels Restaurants & Leisure 2.1%
Hotel Shilla Co., Ltd. 581,047 5,172,905
Kangwon Land, Inc. 996,081 16,991,128
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22,164,033
Internet & Catalog Retail 0.4%
GS Home Shopping, Inc. 38,044 3,952,055
Media 1.5%
Cheil Communications, Inc. 54,153 10,379,109
Yedang Entertainment Co., Ltd.* 360,584 5,183,287
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15,562,396
Multiline Retail 1.1%
Taegu Department Store Co., Ltd. (a) 904,880 11,663,283
Textiles, Apparel & Luxury Goods 0.4%
BYC Co., Ltd. 26,761 4,090,445
Consumer Staples 9.0%
Beverages 0.4%
Hite Brewery Co., Ltd. 33,846 4,184,124
Food & Staples Retailing 3.3%
Shinsegae Co., Ltd. 91,914 34,087,895
Food Products 3.2%
CJ Corp. 67,424 4,762,002
Crown Confectionary Co., Ltd. 64,714 9,302,444
Nam Yang Dairy Products Co., Ltd. 22,771 12,285,647
Nhong Shim Co., Ltd. 25,880 6,708,711
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33,058,804
Tobacco 2.1%
KT&G Corp. 514,085 22,267,985
Energy 5.9%
Oil, Gas & Consumable Fuels
S-Oil Corp. (a) 560,001 45,884,126
SK Corp. 276,717 16,043,487
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61,927,613
Financials 16.2%
Banks 5.3%
Jeonbuk Bank (a) 1,886,994 15,551,652
Kookmin Bank 615,438 36,271,621
Kookmin Bank (ADR) 68,312 4,047,486
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55,870,759
Capital Markets 1.3%
Korea Investment Holdings Co., Ltd. 295,739 8,644,025
Samsung Securities Co., Ltd. 111,500 4,701,485
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13,345,510
Consumer Finance 0.7%
LG Card Co., Ltd.* 204,221 7,730,454
Insurance 8.9%
Korean Reinsurance Co. 1,112,357 10,233,471
Oriental Fire & Marine Insurance Co. 395,893 13,999,475
Samsung Fire & Marine Insurance Co., Ltd. (a) 663,110 68,630,455
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92,863,401
Health Care 0.6%
Pharmaceuticals
Choongwae Pharma Corp. 59,975 2,270,256
Yuhan Corp. 33,031 4,336,605
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6,606,861
Industrials 4.7%
Air Freight & Logistics 1.2%
Korea Express Co., Ltd.* 204,344 12,337,012
Building Products 0.2%
Samwoo EMC Co., Ltd. 510,926 2,595,024
Commercial Services & Supplies 2.1%
Insun ENT Co., Ltd. 255,329 3,401,124
S1 Corp. 381,954 18,411,391
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21,812,515
Construction & Engineering 0.2%
Samho International Co., Ltd. 141,088 2,291,750
Electrical Equipment 0.6%
KL Tech, Inc.* 91,600 2,141,869
LG.Philips LCD Co., Ltd. (ADR)* 186,147 3,827,182
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5,969,051
Machinery 0.4%
Korea Iron & Steel Co., Ltd. 153,793 4,428,826
Information Technology 20.4%
Communications Equipment 0.2%
INTOPS Co., Ltd. 109,997 2,345,408
Computers & Peripherals 0.2%
Daeyang E&C Ltd.* 251,469 1,672,443
Electronic Equipment & Instruments 3.8%
Ace Digitech Co. Ltd.* 286,535 2,463,075
Dae Duck Electronics Co., Ltd. 244,297 2,434,776
Hankuk Electric Glass Co., Ltd. 96,394 3,417,900
Interflex Co., Ltd. 452,035 6,194,634
Jahwa Electronics Co., Ltd. 527,917 3,693,143
NEPES Corp.* 3,378 44,511
Samsung SDI Co., Ltd. 142,119 14,777,107
SE Co., Ltd. (b) (g) 636,950 1,916,649
Simm Tech Co., Ltd. 739,583 5,237,679
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40,179,474
Internet Software & Services 0.6%
NHN Corp.* 34,115 5,802,983
Semiconductors & Semiconductor Equipment 15.5%
Mtekvision Co., Ltd. 56,318 1,878,166
Phicom Corp. 717,516 5,631,486
Samsung Electronics Co., Ltd. (a) (c) 230,350 129,799,521
Seoul Semiconductor Co., Ltd. (a) 650,192 16,667,596
SFA Engineering Corp. 315,573 7,832,622
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161,809,391
Software 0.1%
Ahnlab, Inc. 80,869 1,596,455
Materials 9.0%
Chemicals 1.3%
LG Chemical Ltd. 143,834 6,188,928
Samsung Fine Chemicals Co., Ltd. 287,682 7,347,126
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13,536,054
Construction Materials 0.4%
Sungshin Cement Co., Ltd. 186,957 4,246,172
Containers & Packaging 0.2%
Youlchon Chemical Co., Ltd. 237,795 2,575,068
Metals & Mining 7.1%
Dongkuk Steel Mill Co., Ltd. 792,585 16,292,236
POSCO (a) 254,977 57,177,401
SODIFF Advanced Materials Co., Ltd. 35,227 636,348
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74,105,985
Telecommunication Services 3.3%
Wireless Telecommunication Services
SK Telecom Co., Ltd. 174,924 33,945,482
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Total Common Stocks (Cost $249,636,658)
850,099,553
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Preferred Stocks 17.7%
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Consumer Discretionary 7.5%
Automobiles
Hyundai Motor Co. 1,022,120 51,914,097
Hyundai Motor Co. (2nd) 499,954 26,447,015
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78,361,112
Consumer Staples 1.1%
Food Products
CJ Corp. 201,178 8,290,037
CJ Corp. (2nd) 34,073 1,959,157
CJ Corp. (3rd) (Convertible) 20,446 1,136,433
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11,385,627
Energy 0.6%
Oil, Gas & Consumable Fuels
S-Oil Corp. 105,626 6,771,806
Financials 2.4%
Diversified Financial Services 0.5%
Daishin Securities Co., Ltd. 450,481 4,964,573
Insurance 1.9%
Samsung Fire & Marine Insurance Co., Ltd. 361,365 20,258,603
Information Technology 5.7%
Electronic Equipment & Instruments 0.1%
Samsung SDI Co., Ltd. 23,231 1,504,950
Semiconductors & Semiconductor Equipment 5.6%
Samsung Electronics Co., Ltd. (c) 134,164 58,371,305
Materials 0.4%
Chemicals
LG Chemical Ltd. 130,644 3,906,174
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Total Preferred Stocks (Cost $26,166,910)
185,524,150
Principal
Amount ($) Value ($)
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Convertible Bond 0.0%
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Consumer Staples
Haitai Confectionery Loan Certificates, Zero Coupon, 9,577,892 8,149
11/28/2009 (b) (d) (e)
(Cost $0)
Shares Value ($)
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Rights 0.0%
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Information Technology
Nepes Corp.* (Cost $1,263) 568 2,050
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Cash Equivalents 0.1%
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Scudder Cash Management QP Trust, 3.74% (f) 807,785 807,785
(Cost $807,785)
% of Value
Net Assets ($)
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Total Investment Portfolio (Cost $ 276,612,616) 99.0 1,036,441,687
Other Assets and Liabilities, Net 1.0 10,468,151
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Net Assets 100.0 1,046,909,838
For information on the Fund's policies regarding the valuation of
investments and other significant accounting policies, please refer to the
Fund's most recent semi-annual or annual financial statements.
* Non-income producing security.
(a) Affiliated issuers. An affiliated issuer is a company in which the Fund has
ownership of at least 5% of the voting securities. A summary of the Fund's
transactions during the nine months ended September 30, 2005 with companies
which are or were affiliates is as follows:
Realized Dividend
Purchase Sales Gain/ Income
Affiliate Common Shares Cost ($) Cost ($) (Loss) ($) ($)+ Value ($)
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JeonBuk Bank 1,886,994 - 3,300,224 2,590,158 - 15,551,652
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Posco 254,977 - 9,272,272 11,195,099 151,976 57,177,401
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Samsung Climate 560,224 - 934,798 633,879 - 3,527,237
Control
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Samsung 230,350 - 4,259,952 56,161,027 - 129,799,521
Electronics Co.
Ltd.
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Samsung Fire & 663,110 - 2,178,809 5,565,729 - 68,630,455
Marine Insurance
CO. Ltd
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S-Oil Corp 560,001 - 310,314 318,841 503,439 45,884,126
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Seoul 650,192 - 4,529,701 4,014,409 - 16,667,596
Semiconductor Co.
Ltd.
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Taegu Department 904,880 - 2,712,881 1,903,540 - 11,663,283
Store Co. Ltd
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65,498,951 82,382,682 655,415 349,556,686
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+ Net of foreign taxes withheld
(b) Securities valued at fair value by management and approved in good faith
following procedures approved by the Directors, amounted to $1,924,798
(0.2% of net assets at September 30, 2005). Their values have been
estimated by management in the absence of readily ascertainable market
values. However, because of the inherent uncertainty of valuation, those
estimated values may differ significantly from the values that would have
been used had a ready market for the securities existed, and the difference
could be material. The cost of these securities at September 30, 2005
aggregated $1,616,637. The securities may also have certain restrictions as
to resale.
(c) At September 30, 2005, 18.0% of the Fund's investment portfolio is invested
in Samsung Electronics Co., Ltd.
(d) Company in restructuring process, principal only subject to repayment.
(e) Amount stated in Korean Won.
(f) Scudder Cash Management QP Trust is managed by Deutsche Investment
Management Americas Inc. The rate shown is the annualized seven-day yield
at period end.
(g) The Fund may purchase securities that are subject to legal or contractual
restrictions on resale ("restricted securities"). Restricted securities are
securities which have not been registered with the Securities and Exchange
Commission under the Securities Act of 1933. The fund may be unable to sell
a restricted security and it may be more difficult to determine a market
value for a restricted security. Moreover, if adverse market conditions
were to develop during the period between the Fund's decision to sell a
restricted security and the point at which the Fund is permitted or able to
sell such security, the Fund might obtain a price less favorable than the
price that prevailed when it decided to sell. This investment practice,
therefore, could have the effect of increasing the level of illiquidity of
the Fund. The future value of these securities is uncertain and there may
be changes in the estimated value of these securities.
A Shareholder of SE Co. Ltd. has given the Fund a put option at cost,
payable on demand until it has an initial public offering. Information
concerning the private placement security at September 30, 2005 is as
follows:
As a % of Net
Restricted Security Acquisition Date Cost ($) Value ($) Assets
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SE Co., Ltd. 12/22/2000 1,616,637 1,916,649 0.2
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ADR: American Depositary Receipt
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.
Registrant: The Korea Fund, Inc.
By: /s/Vincent J. Esposito
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Vincent J. Esposito
President
Date: November 22, 2005
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.
Registrant: The Korea Fund, Inc.
By: /s/Vincent J. Esposito
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Vincent J. Esposito
President
Date: November 22, 2005
By: /s/Paul Schubert
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Paul Schubert
Chief Financial Officer and Treasurer
Date: November 22, 2005