Semi Annual Report Rolinco 2005

    8 Septmber 2005, Rotterdam


                                                         ROLINCO N.V.

                                          SEMIANNUAL REPORT JUNE 2005

































                              % ROBECO
CONTENTS

General information                                   2
Report of the management board            3
Balance sheet                                                7
Profit and loss account                               7
Cash-flow summary                                   8
Notes                                                             8
Other data                                                   13
Spread of net assets                                   14

GENERAL INFORMATION

ROLINCO N.V. 1)
(investment company with a variable capital, having its registered
office in Rotterdam, the Netherlands)
Coolsingel 120
Postbus 973
NL-3000 AZ Rotterdam
Tel. +31- 10 - 224 12 24
Fax +31 - 10 - 411 52 88
Internet: www.robeco.com

Supervisory Board
Paulus C. van den Hoek
Gilles Izeboud RA
Johan Kremers (until 21 April 2005)
Philip Lambert (as of 21 April 2005)
Dirk P.M. Verbeek

Management Board
Arnout van Rijn
Volker Wytzes

Prospectus
The prospectus is available at the offices of the company and via
www.robeco.com.
REPORT OF THE MANAGEMENT BOARD

GENERAL INTRODUCTION

Stock markets climb a wall of worry
An old English stock-market adage is 'the market is climbing a wall
of worry' and there were plenty of things to worry about in the first
few months of 2005. There were concerns about rises in commodity and
oil prices, a rate hike in the United States, low growth in Europe,
the return of deflation in Japan, the rating downgrade of General
Motors and Ford and there were concerns about growth in China. But
stock prices climbed this wall of worry and helped by the advance of
the US dollar against the euro, the MSCI World Index rose 11.8% in
euros.
Once again, most growth occurred in the United States and China. US
consumers were a little discouraged by rising oil prices and higher
interest rates, but they continued spending. Business confidence,
however, did decrease slowly but surely. Producers faced higher wage
costs, lower productivity and increasing commodity prices. The
expected earnings growth decreased rapidly but growth in China
remained at its usual high level and the trade surplus increased
further. One detail, which is worthy of note here, is that China has
become a net exporter of steel for the first time this year. Huge
capital expenditure in the past few years has considerably increased
production capacity so the Western steel industry had better be
prepared for the worst.
The old world markets of Europe and Japan are lagging. It was a
particularly tough period for Europe, with difficult political
situations in the European Union and in Europe's core countries
Germany, France and Italy. Europe's joint monetary policy also had
its limitations. While the low growth in Germany calls for a rate
cut, this same rate cut may cause the Irish economy to overheat. It
is however all a matter of give and take. Still, European equities
outperformed their US counterparts because they are still cheaper.
Japanese equities lagged but this country may well turn out to be the
surprise of the second half of the year. Wages are increasing,
consumer spending is positive and Japanese businesses are gradually
discovering that shareholders like high dividends.

Outlook
The second half of 2005 will on the whole be worse than the first
half. US growth will slow down as US consumers finally curb their
spending. Earnings growth will decline, as the increase in commodity
prices and wage costs (the latter only in the US) may lead to lower
margins. But the situation will not be really bad as, however you
look at it, valuations are reasonable and what is the alternative? A
savings account that offers 2.5% interest? A government bond that
offers 3% interest? Or a corporate bond that offers 3.5%?
INVESTMENT RESULT


In the first half of 2005, the share price of Rolinco rose from EUR
18.00 to EUR 20.56. Assuming reinvestment of the dividend of EUR 0.28
per share distributed in May 2005, this is an investment result of
15.9%*. On the basis of net asset value, which rose from EUR 18.12 to
EUR 20.43, the investment result was 14.5%. The fund's benchmark, the
S&P/Citigroup Primary Market Index Growth World (Total Return), rose
11.7% over the same period which meant that Rolinco realized a
result, which exceeded the average return of growth stocks by more
than 2.5%. Good stock selection was responsible for most of the
outperformance although the strategic interest in emerging markets
also contributed positively.
It was encouraging that growth stocks kept pace with the market as a
whole in the first half of 2005 after five years of relatively poor
returns.
The most important themes in the stock markets were: high oil prices,
low bond yields, the rising housing market and the weak euro.
The low bond yields were a conundrum to Fed chairman Alan Greenspan,
but they did support US consumers in their debt-financing activities.
An increasing number of private individuals are convinced that the
price of their houses can only go one way: up. This may be a
dangerous development but in view of our stable interest-rate outlook
this could continue for quite some time and it does provide a solid
base for the purchasing power of US consumers.
In 2004, Rolinco had to deal with a headwind that grew stronger
throughout the year, whereas in the first half of 2005 it has
benefited from a brisk tail wind with the dollar appreciating by 11%
against the euro. In the run-up to the French referendum on the
European Constitution, attention shifted away from the weak dollar
and the US debt problems to concerns about the euro's strength.
European growth is still disappointing and the EU countries are
unable to reach an agreement on a joint future.
INVESTMENT POLICY
Turnover in the portfolio remained limited to roughly 21% in the
first half, which is appropriate for a fund with an investment
horizon of three years.
Our outlook for the Japanese stock market is still favorable as
demonstrated by a further increase of our weight in Japan from 15% to
more than 16%. A visit to the country and to several Japanese
companies in Rotterdam confirmed that more attention is being paid to
increasing returns and dividends but this is being done in the
Japanese way which is cautiously and slowly. These developments have
not yet been rewarded with strong price gains, as the Japanese market
ended the reporting period virtually unchanged.
The holding in emerging markets was lowered to 5% in early March.
There is plenty of liquidity available in the world as a delayed
result of the US accommodative monetary policy in 2004. Now that
short rates are starting to rise again, money-supply growth is
decreasing rapidly and in the longer term this will lead to more
risk-averse behavior. Emerging markets could suffer from this but the
fundamental situation remains extremely healthy: high growth, limited
deficits and low market valuations.
The position in the US dollar was increased to well over 50% in three
steps. The consensus about the weak dollar was so great at the end of
2004 that Rolinco's slightly contrary investment strategy no longer
justified an underweight in the US currency.
Within the energy sector the fund benefited considerably from rising
oil prices and high refining margins through its large interests in
Canadian Natural Resources and Valero. Towards the end of the
reporting period we started to take profits in this sector where
momentum has become increasingly important.
In the health-care sector large interests in drug distributor Medco
Health Solutions and health insurer Wellpoint made a fine
contribution. The stock of Swiss pharmaceutical company Roche also
performed well in the reporting period, partly due to successes in
the field of cancer treatment. Biotechnology company Elan was among
the losers as it turned out that its multiple-sclerosis drug can lead
to serious complications so it was temporarily withdrawn from the
market. Rolinco suffered a considerable loss when it closed this
position.


Top 10 stocks
                       Country   Interest in %       Performance in %
                                    30/06/2005       01/01-30/06/2005
                                                  In euros   In local
                                                             currency

 1. Total              France               2.6       23.0       23.0
 2. Microsoft          US                   2.5        5.0       -6.5
 3. Roche              Switzerland          2.4       25.5       25.9
 4. Canadian Natural
    Resources          Canada               2.3       90.9       73.8
 5. Wellpoint          US                   2.0       36.0       21.1
 6. Fannie Mae         US                   1.9       -7.1      -17.3
 7. Nestl