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[LOGO]
SCHRODER
EMERGING MARKETS FUND
INSTITUTIONAL PORTFOLIO
SEMI-ANNUAL REPORT
APRIL 30, 2000
(UNAUDITED)
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
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May 24, 2000
Dear Shareholder:
We are pleased to present the semi-annual report for the Schroder
Emerging Markets Fund Institutional Portfolio for the six months ended April
30, 2000.
The first half of fiscal 2000 was a period of great change for
Schroders. On January 18, 2000, Schroders plc announced the sale of its
investment banking business to Salomon Smith Barney. It is expected that the
sale of the investment bank will prove to have several positive implications
for the Schroder Investment Management companies. First, the sale provides
ample capital available for investment in our business. In addition, investment
management is now the dominant focus of the entire Schroder organization.
In general, emerging markets showed renewed strength in the first half
of fiscal 2000, but consolidated later in the period. Volatility was the
hallmark of the past six months, as the technology and related stocks, which
had soared, finally corrected sharply toward the end of the period. There was a
decisive rotation out of these more speculative issues and into more value-
oriented segments, leaving experts debating whether the volatility signals a
clear turning point or merely the rationalization of the most severely
overvalued new economy stocks. We believe that times like these support the
case for a disciplined, diversified investing program, including smaller-cap
equities, international and emerging markets, and fixed-income investments.
This report includes performance information, the schedule of
investments, comments from portfolio managers, and other relevant information
for the Fund. We encourage you to read the report, and thank you for making
Schroders part of your investment program. We look forward to providing service
for your investment needs.
Sincerely,
Alexandra Poe
PRESIDENT
2
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MANAGEMENT DISCUSSION AND ANALYSIS (AS OF APRIL 30, 2000)
PERFORMANCE
The Schroder Emerging Markets Fund Institutional Portfolio's Investor
Shares had a total return of 11.33% and its Advisor Shares had a total return
of 11.44 % for the six-month period ended April 30, 2000, not including the
deduction of the purchase and redemption fees of 0.50%. Including the purchase
and redemption fees, the Fund's total returns for the semi-annual period were
10.22% for Investor Shares and 10.33% for Advisor Shares. The MSCI Emerging
Markets Free Index returned 13.11% over the same period.
Relative to the Index, the Fund benefited from positive country
allocation, notably the underweight position in Greece, and strong stock
selection in technology-related stocks in markets such as Taiwan. Local market
conditions proved to be a hindrance in this period. The Fund's performance was
hampered because it held no position in a particularly well-performing Indian
software company that is difficult to invest in, as it is closely held, but
represents a significant weighting in the Index. This was compounded by the
overweight position in an Indian telecommunications stock, VSNL, which suffered
from political concerns about the ongoing pace of privatization.
MARKET BACKGROUND
Emerging markets showed renewed strength in the six months ended April
30, 2000, outperforming developed markets, although they consolidated late in
the period. The external environment generally was favorable thanks to balanced
global growth. In addition, recent upgrades to economic and earnings numbers
helped emerging markets offset the initial negative effect of rising interest
rates in developed markets, particularly the United States. Business cycles and
the direction of interest rates have varied across emerging markets, with
interest rates moving higher in Asia, generally falling in Latin America and
mixed within Europe, the Middle East and Africa (EMEA).
Early in the six-month period, Asian markets performed well, but later
suffered from the global technology sell-off. Malaysia was the best-performing
market, as it benefited from a continuing recovery in economic growth, led by a
resurgence in exports to the region and the United States. India was also
strong, in light of the higher-than-expected demand for software development
services, while Taiwan outperformed, as it became clear that its relationship
with China under new President Chen Shui-bian was not likely to worsen. China
benefited from its nascent economic recovery, although its ability to cut rates
has been constrained by high oil prices. Korea suffered from fears that the
country's loose monetary policy would result in higher inflation and interest
rates.
Latin America initially benefited from Mexican and Brazilian debt
rating upgrades, falling interest rates, reduced political risk, and corporate
activity, but later suffered from its high correlation to the NASDAQ. This is
less the result of its exposure to technology stocks, but more to do with its
perception as a high risk asset class. The main event in the region was the
upgrade by Moody's of Mexico's sovereign debt to investment grade, thus paving
the way for lower-cost finance from capital markets. Brazil benefited from
improving economic fundamentals. Brazil's fiscal deficit is declining, and low
inflation is feeding through to low real interest rates. These factors,
together with ratings upgrades, are helping the real economy.
The countries of Eastern Europe produced some of the strongest returns
over the period, spurred by improving economic fundamentals and corporate
restructuring, with particularly robust gains registered by large
telecommunications stocks. The Russian equity market responded positively to
the resignation of Boris Yeltsin. Vladimir Putin's victory in the presidential
elections reinforced expectations of political stability and implementation of
much-needed structural reform. Higher oil prices also helped, providing
windfall tax revenues for the Russian government and a substantial current
account surplus.
Turkey benefited from further progress in its privatization program
and from a credible plan to reduce inflation in order to meet IMF targets.
Israel was boosted by falling interest rates, as well as its high concentration
in the technology sector. However, the technology related strength experienced
early in the quarter by Israel's stocks that are co-listed on the NASDAQ has
also rendered it vulnerable to the recent shakeout in global technology stocks
that followed.
3
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PORTFOLIO REVIEW
The Fund was initially overweight in Latin America, as the region was
benefiting from economic recovery and earnings upgrades. Our preferred markets
within Latin America were Brazil and Mexico, given our expectations of stronger
economic and earnings growth. However, late in the period we reduced the Fund's
exposure to both countries, as they appeared vulnerable to U.S. market and
economic shocks. We increased the Fund's exposure to Asia through purchases in
Taiwan, Malaysia and China, partially in anticipation of forthcoming MSCI Index
changes (see discussion below), but also because of strong fundamentals. We
reduced the Fund's allocation to Korea, however, because of rising inflation
and interest rates. Within EMEA, we maintained underweight positions for the
Fund in Greece and South Africa.
While the Fund was overweight the technology and telecommunications
sectors, we focused our exposure on companies that we expect will benefit from
the fundamental support of high growth potential and attractive margins, rather
than purer "new economy" plays that appear most vulnerable to further market
corrections. The majority of the Fund's technology exposure is in Taiwan, Korea
and India, where it has invested in hardware and software companies such as
TAIWAN SEMICONDUCTOR (the world's first pure integrated circuit foundry
company).
OUTLOOK
The outlook for emerging markets PRIMA FACIE appears positive: Current
global growth remains supportive, valuations are low relative to developed
markets, and the visible recovery in most emerging market economies should be
reflected in upward earnings revisions.
Yet there are risks of external shocks, and the recent global sell-off
of technology stocks and concerns over the U.S. economy will likely have
repercussions for emerging markets. While we believe that a "soft landing" can
be achieved in the United States, there is some concern that in a worst-case
scenario, a sustained correction in technology-related stocks could damage
overall market confidence and cause a negative wealth effect, which combined
with rising interest rates, might precipitate a "hard landing." This said, we
believe that there is sufficient momentum within the emerging markets to
weather all but the worst scenarios, and we anticipate that emerging market
countries will, on the whole, continue to perform well relative to developed
markets.
Technical considerations will be among the most important issues
affecting Asia in the coming months. Malaysia will re-enter the MSCI EMF Index
on May 31, 2000, and is expected to represent around 7% of the Index up from
3.7% prior to its removal. The MSCI has also announced Index changes for Taiwan
and China. Taiwan will be increased gradually to avoid market dislocations from
its current 50% market capitalization weighting to a 65% weighting on May 31,
2000, and ultimately to a 100% weighting by May 31, 2001. China's weighting in
the MSCI EMF Index will be raised from 0.4% to around 6% on May 31, 2000, when
it includes Hong Kong listed stocks (Red Chips) for the first time. By
implication, all these changes will cause the weightings of other markets in
this Index to fall.
THE VIEWS EXPRESSED IN THIS REPORT WERE THOSE OF THE FUND'S PORTFOLIO MANAGER
AS OF THE DATE SPECIFIED, AND MAY NOT REFLECT THE VIEWS OF THE PORTFOLIO
MANAGER ON THE DATE THIS REPORT IS FIRST PUBLISHED OR ANY TIME THEREAFTER. THIS
VIEW IS INTENDED TO ASSIST SHAREHOLDERS OF THE FUND IN UNDERSTANDING THEIR
INVESTMENT IN THE FUND AND DO NOT CONSTITUTE INVESTMENT ADVICE; INVESTORS
SHOULD CONSULT THEIR OWN INVESTMENT PROFESSIONALS AS TO THEIR INDIVIDUAL
INVESTMENT PROGRAMS. CERTAIN SECURITIES DESCRIBED IN THIS REPORT MAY NO LONGER
BE HELD BY THE FUND AND THEREFORE NO LONGER APPEAR IN THE SCHEDULE OF
INVESTMENTS AS OF APRIL 30, 2000.
4
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<TABLE>
<CAPTION>
Portfolio Characteristics as of April 30, 2000
COUNTRY WEIGHTINGS TOP TEN HOLDINGS
COUNTRY % OF NET ASSETS SECURITY % OF NET ASSETS
-------------------------------- ---------------------------------------
<S> <C> <C> <C>
Taiwan 13.8% Samsung Electronics 5.2%
Korea 11.6 Telefonos de Mexico ADR 4.4
Mexico 11.5 United Microelectronics 3.4
Brazil 9.6 Taiwan Semiconductor Manufacturing 1.8
India 7.0 Infosys Technologies 1.7
South Africa 6.6 Grupo Televisa GDS 1.7
Turkey 5.1 Yapi ve Kredi Bankasi 1.4
Israel 4.5 Korea Electric Power 1.4
Russia 3.3 Embratel Participacoes ADR 1.4
Malaysia 3.1 LUKoil ADR 1.2
Chile 1.9 -----
Hong Kong 1.8 Total 23.6%
Greece 1.7 =====
Thailand 1.7
Poland 1.5
Hungary 1.4
Argentina 1.1
Philippines 0.6
Zimbabwe 0.6
Czech Republic 0.6
Peru 0.5
Egypt 0.3
Indonesia 0.3
Botswana 0.1
Cash Equivalents
and Other Net Assets Cash 9.8
-----
Total 100.0%
-----
</TABLE>
PERFORMANCE INFORMATION - (a)
<TABLE>
<CAPTION>
ONE YEAR FIVE YEARS AVERAGE ANNUAL ONE YEAR FIVE YEARS AVERAGE ANNUAL
ENDED ENDED RETURN FROM ENDED ENDED RETURN FROM
MARCH 31, MARCH 31, INCEPTION TO APRIL 30, APRIL 30, INCEPTION TO
2000 2000 (b) MARCH 31, 2000 (c) 2000 2000 (b) APRIL 30, 2000 (c)
------- -------- ------------------ ------ -------- ------------------
<S> <C> <C> <C> <C> <C> <C>
Schroder Emerging Markets Fund
Institutional Portfolio - Investor Shares 45.35% 5.88% 5.88% 14.58% 2.62% 3.22%
Schroder Emerging Markets Fund
Institutional Portfolio - Advisor Shares 45.15% 5.74 (d) 5.74 (d) 15.69 2.56 (d) 3.15 (d)
</TABLE>
(a) Reflects the payment of a 0.50% purchase charge (based on the amount
purchased) at the time of investment and a 0.50% redemption charge (based
on the amount redeemed) deducted at the end of the period shown.
(b) Average annual total return
(c) Average annual total return from commencement of Fund operations (March 31,
1995).
(d) Performance for the Fund's Advisor Shares includes information for the
Fund's Investor Shares for the periods prior to the inception date of
Advisor Shares (November 21, 1996). Such prior performance has been
recalculated to reflect the actual fees and expenses attributable to
Advisor Shares.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE
RESULTS. THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT
WILL FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN
INVESTOR'S ORIGINAL COST.
5
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<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS
APRIL 30, 2000 (UNAUDITED)
SHARES VALUE
------ ------
<S> <C> <C>
COMMON STOCKS -- 86.0%
ARGENTINA -- 1.1%
42,892 Banco De Galicia
Y Buenos Aires $ 742,568
70,408 IRSA Inversiones
Y Representaciones 207,850
23,584 Minsur 42,508
10,400 Nortel Inversora ADR 192,400
15,751 PC Holdings ADR (1) 241,187
51,000 Quilmes Industrial
(Quinsa) ADR 484,500
224,000 Telecom Argentina Stet -
France Telecom 1,244,075
---------
3,155,088
---------
BOTSWANA -- 0.1%
400,500 Sechaba Brewery 339,360
---------
BRAZIL -- 6.1%
23,600 Aracruz Celulose 441,025
44,300 Companhia Brasileira
de Distribuicao Grupo Pao
de Acucar 1,262,550
111,400 Companhia Paranaense
de Energia-Copel ADR 821,575
100,900 Companhia Vale Do
Rio Doce 2,499,505
174,800 Embratel Participacoes
ADR 3,933,000
131,100 Petroleo Brasileiro ADR 3,105,943
24,800 Tele Celular Sul
Participacoes 957,900
6,700 Tele Centro Sul
Participacoes ADR 427,125
141,647 Tele Norte Leste
Participacoes ADR 2,523,094
32,700 Telecomunicacoes de
Sao Paulo ADR 825,675
Telesp Celular Participacoes 7
44,700 Ultrapar Participacoes 402,300
23,600 Uniao de Bancos Brasileiros 588,525
---------
17,788,224
---------
CHILE -- 1.9%
16,800 Banco De
A. Edwards ADR 276,150
13,600 Banco Santiago ADR 268,600
16,900 Chilectra 297,773
86,425 CIA de Telecomunicaciones
de Chile ADR 1,598,863
27,700 Compania Cervecerias
Unidas 618,056
25,800 Distribucion Y
Servicio D&S 438,600
41,200 Embotelladora
Andina ADR 422,300
44,100 Empresa Nacional
De Electricidad 507,150
CHILE-- (CONTINUED)
26,255 Enersis ADR $ 488,999
56,700 Quinenco 637,875
---------
5,554,366
---------
CZECH REPUBLIC -- 0.6%
213,400 Ceske Energeticke
Zavody (1) 621,359
3,740 Ceske Radiomunikace (1) 169,516
45,766 SPT Telecom (1) 850,936
---------
1,641,811
---------
EGYPT -- 0.3%
23,170 Egyptian Company for Mobile
Services (MobilNil) (1) 883,333
---------
GREECE -- 1.7%
22,223 Alpha Credit Bank 1,226,825
108,900 Hellenic Telecommunications
Organization 2,457,245
15,345 National Bank Of Greece 656,334
28,870 Panafon Hellenic Telecom 348,002
13,680 STET Hellas
Telecommunications (1) 312,930
---------
5,001,336
---------
HONG KONG -- 1.8%
11,750 AsiaInfo Holdings (1) 511,125
405,000 China Telecom
(Hong Kong) (1) 2,898,806
1,482,000 Founder Holdings (1) 856,209
477,000 Pacific Century
CyberWorks (1) 887,985
---------
5,154,125
---------
HUNGARY -- 1.4%
5,060 BorsodChem Rt. GDR 186,461
63,078 Matav Rt. ADR 2,195,903
22,400 MOL Magyar Olaj -
Es Gazipari Rt. GDR 394,800
23,250 OTP Bank Rt. GDR 1,034,044
6,050 Richter Gedeon GDR 335,775
---------
4,146,983
---------
INDIA -- 7.0%
65,150 Associated Cement (1) 207,436
370,000 Bharat Petroleum 1,480,216
379,000 HDFC Bank 2,139,552
48,000 Hindustan Lever 2,633,198
17,450 Hindustan Petroleum 44,708
26,600 Infosys Technologies 4,947,576
992 ITC 12,950
450,000 Mahanagar Telephone
Nigam 2,319,778
30,000 Pentamedia Graphics 439,423
159,000 Reliance Industries 1,254,340
26,900 Satyam Computer Services 1,927,409
71,800 Videsh Sanchar Nigam 1,912,354
56,500 Zee Telefilms (1) 918,886
---------
20,237,826
---------
</TABLE>
The accompanying notes are an integral part of the financial statements
6
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<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS (CONTINUED)
APRIL 30,2000 (UNAUDITED)
SHARES VALUE
------ -----
<S> <C> <C>
COMMON STOCKS -- (CONTINUED)
INDONESIA -- 0.3%
1,834,820 PT Telekomunikasi
Indonesia $ 798,780
-----------
ISRAEL -- 4.5%
908,060 Bank Hapoalim 2,791,877
990,810 Bank Leumi Le-Israel 2,155,236
50,460 Blue Square - Israel 469,909
18,650 Check Point Software
Technologies (1) 3,226,450
2,800 Comverse Technology (1) 249,725
18,710 ECI Telecom 520,372
3,300 Gilat Satellite Networks (1) 283,387
8,170 Nice Systems (1) 534,624
3,800 Orbotech (1) 323,950
19,200 Partner
Communications (1) 205,200
17,800 Scitex (1) 211,375
45,940 Teva Pharmaceutical
Industries 2,021,360
---------
12,993,465
---------
KOREA -- 11.4%
34,000 Haansoft 600,515
191,085 Kookmin Bank 2,066,315
142,570 Korea Electric Power 4,175,420
14,500 Korea Telecom ADR 500,250
5,000 LG Home Shopping 398,301
7,400 Locus (1) 900,231
26,308 Medidas 386,424
190,500 Samsung 2,162,989
61,244 Samsung Electronics 15,421,401
34,000 SEROME Technology 1,001,879
232,900 Shinhan Bank 2,235,156
142,000 SK GDR 2,680,779
40,181 Turbo Tek 610,112
---------
33,139,772
----------
MALAYSIA -- 3.1%
410,000 AMMB Holdings 1,553,720
341,000 Genting 1,373,006
170,000 Resorts World 550,276
360,000 Telekom Malaysia 1,250,556
650,000 Tenaga Nasiona 2,155,314
834,000 United Engineers
(Malaysia) 2,150,892
---------
9,033,764
---------
MEXICO -- 11.5%
272,400 Alfa 842,097
99,212 Cemex ADR (1) 2,170,262
461,900 Consorico Ara (1) 572,148
596,400 Fomento Economico
Mexico 2,360,075
667,400 Grupo Financiero
Banamex Accival (1) 2,410,611
2,527,200 Grupo Financiero
Bancomer (1) 1,127,589
204,100 Grupo Industrial Saltillo 453,160
MEXICO-- (CONTINUED)
307,500 Grupo Modelo $ 653,337
135,000 Grupo Sanborns (1) 232,333
75,700 Grupo Televisa GDS (1) 4,802,219
583,900 Kimberly - Clark de Mexico 1,879,503
25,800 Nuevo Grupo
Iusacell ADR (1) 411,188
216,700 Telefonos de Mexico ADR 12,744,669
1,302,700 Wal-Mart De Mexico (1) 2,774,730
---------
33,433,921
----------
PERU -- 0.5%
16,400 Compania de Minas
Buenaventura 282,900
78,700 Credicorp 831,269
18,900 Telefonica De Peru 285,862
---------
1,400,031
---------
PHILIPPINES -- 0.6%
358,280 Manila Electric "B" Shares 642,207
67,040 Philippine Long Distance
Telephone 1,201,674
---------
1,843,881
---------
POLAND -- 1.5%
11,460 Bank Handlowy
W Warszawie 165,310
139,800 Elektrim Towarz (1) 1,751,073
90,000 KGHM Polska
Miedz GDR 1,314,000
140,050 Telekomunikacja
Polska GDR 1,074,884
---------
4,305,267
---------
RUSSIA -- 3.3%
59,805 LUKoil ADR 3,605,045
101,260 OAO Gazprom 670,847
89,690 RAO Unified Energy
Systems 1,671,822
35,300 Rostelecom ADR (1) 686,144
182,450 Surgutneftegaz 2,768,679
---------
9,402,537
---------
SOUTH AFRICA -- 6.6%
371,317 ABSA Group 1,314,538
250,000 African Bank
Investments (1) 540,250
66,500 Anglo American Platinum 1,608,728
144,721 Barlow 907,272
49,200 De Beers 1,008,781
393,462 Dimension Data Holdings 2,582,736
97,900 Fedsure Holdings 542,985
1,342,250 FirstRand 1,583,947
343,076 LA Retail Stores 209,511
55,556 Liberty Life Association
of Africa 520,381
842,630 Malbak 385,315
772,753 Metro Cash and Carry 582,477
374,900 Nampak 873,755
949,603 Profurn 574,306
148,700 Rembrandt Group 1,153,756
957,781 Sanlam 1,137,311
153,000 Sappi 1,072,018
</TABLE>
The accompanying notes are an integral part of the financial statements
7
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<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
SHARES VALUE
------ -----
<S> <C> <C>
COMMON STOCKS -- (CONTINUED)
SOUTH AFRICA -- (CONTINUED)
281,200 Sasol $ 1,650,880
224,360 Standard Bank Investment 827,375
---------
19,076,322
----------
TAIWAN -- 13.3%
150,000 Ambit Microsystems 1,386,368
164,000 Asustek Computer 1,815,702
407,000 Compeq Manufacturing 2,246,374
196,000 Cosmo Electronics (1) 1,152,204
325,000 Dialer Business Electronics 1,013,649
778,250 Formosa Plastics 1,613,964
690,000 Macronix International 2,084,451
1,157,038 Nan Ya Plastic 2,475,084
2,048,000 Pacific Electric
Wire & Cable 2,019,937
44,000 Synnex Technology
International 297,457
370,400 Systex 1,614,928
817,000 Taiwan Semiconductor
Manufacturing 5,256,410
2,938,000 United Microelectronics 9,931,002
110,000 Via Technologies 1,832,162
297,000 Wintek 1,765,342
1,022,000 Yuanta Securities 1,598,775
96,000 Zinwell (1) 558,074
----------
38,661,883
----------
THAILAND -- 1.7%
105,000 Advanced Info Service (1) 1,229,655
58,200 Siam Cement 1,344,822
1,684,157 TelecomAsia (1) 1,945,786
329,000 Thai Farmers Bank (1) 345,553
---------
4,865,816
---------
TURKEY -- 5.1%
56,583,400 Akbank T.A.S. 1,273,795
9,302,200 Akcansa Cimento 205,602
2,917,600 Arcelik 248,392
11,498,100 Dogan Yayin Holding 277,668
1,232,170 Ege Biracilik Ve
Malt Sanayii 110,954
9,593,990 Erciyas Biracilik ve
Malt Sanayii 714,691
10,814,000 Eregli Demir ve
Celik Fabrikalari
T.A.S (Erdemir) 593,115
60,456,811 Haci Omer Sabanci
Holding 979,914
10,948,810 Hurriyet Gazetecilik ve
Matbaacilik 277,847
5,568,600 Koc Holding 1,116,837
2,362,760 Migros Turk T.A.S. 1,605,371
114,290,850 Turkiye Garanti Bankasi 1,927,331
9,220,100 Turkiye Is Bankasi (Isbank) 505,694
1,633,600 Vestel Electronik Sanayi ve
Ticaret (1) 615,150
131,439,458 Yapi ve Kredi Bankasi 4,196,315
----------
14,648,676
----------
ZIMBABWE -- 0.6%
4,720,000 Econet Wireless
Holdings (1) $ 1,725,379
------------
TOTAL COMMON STOCKS
(Cost $222,937,178) 249,231,946
-----------
PREFERRED STOCK -- 3.7%
BRAZIL -- 3.5%
318,507,780 Banco Bradesco 2,329,966
6,790,000 Banco Itau 507,995
2,006,000 Companhia Cervejaria
Brahma 1,456,323
4,300,000 Companhia Cimento
Portland Itau 529,026
22,815,360 Eletropaulo Metropolitana -
Electricidad de Sao Paulo 1,314,971
13,110,000 Gerdau 316,771
17,353 Itausa - Investimentos Itau 14,906
148,000,000 Tele Centro Sul
Participacoes 1,935,661
63,557,630 Telesp Celular Participacoes 1,141,217
23,176,662 Telesp Tel Sao Pau 577,860
----------
10,124,696
----------
KOREA -- 0.2%
5,000 Samsung Electronics 671,344
----------
TOTAL PREFERRED STOCK
(Cost $9,294,693) 10,796,040
----------
WARRANTS -- 0.5%
MEXICO -- 0.0%
6,125 Cemex (1) 16,844
----------
TAIWAN -- 0.5%
106,000 DBTEL 332,310
177,000 Taiwan Semiconductor (1) 1,136,800
---------
1,469,110
---------
TOTAL WARRANTS
(Cost $1,521,931) 1,485,954
---------
SHORT-TERM INVESTMENTS -- 9.1%
13,137,994 SSgA Money Market
Fund 5.766% (2) 13,137,994
13,137,994 SSgA U.S. Government Money
Market Fund 5.677% (2) 13,137,994
----------
TOTAL SHORT-TERM INVESTMENTS
(Cost $26,275,988) 26,275,988
----------
</TABLE>
The accompanying notes are an integral part of the financial statements
8
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<TABLE>
<CAPTION>
SCHEDULE OF INVESTMENTS (CONCLUDED)
APRIL 30, 2000 (UNAUDITED)
PRINCIPAL
AMOUNT VALUE
--------- -----
<S> <C> <C>
REPURCHASE AGREEMENT -- 1.1%
$3,283,000 State Street Bank and
Trust Company,
4.75%, 05/01/2000 (3) $ 3,283,000
------------
(Cost $3,283,000)
TOTAL INVESTMENTS
(Cost $263,312,790)
-- 100.4% 291,072,928
LIABILITIES IN EXCESS OF
OTHER ASSETS
-- (0.4%) (1,260,704)
-----------
TOTAL NET
ASSETS -- 100% $ 289,812,224
==============
</TABLE>
(1) Denotes non-income producing security.
(2) Interest rate shown is 7-day yield as of April 30, 2000.
(3) The repurchase agreement, dated 4/28/00 with a repurchase price of
$3,284,300 is collateralized by a $2,990,000 United States Treasury
Bond, 9.125%, due 5/15/09, valued at $3,351,942.
ADR -- American Depository Receipts
GDR -- Global Depository Receipts
GDS -- Global Depository Shares
The accompanying notes are an integral part of the financial statements
9
<PAGE>
-------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 2000 (UNAUDITED)
ASSETS
<S> <C>
Investments in securities, at value - Note 2 ................. $ 291,072,928
Cash ......................................................... 11,950,759
Foreign currency, at value ................................... 3,116,493
Dividends receivable ......................................... 1,075,838
Interest receivable .......................................... 48,641
Receivable for securities sold ............................... 657,614
Receivable for Fund shares sold .............................. 525,046
Deferred organizational costs ................................ 8,537
Prepaid expenses ............................................. 1,393
Due from Investment Adviser - Note 3 ......................... 100,535
-----------
TOTAL ASSETS .............................................. 308,557,784
-----------
LIABILITIES
Payable for securities purchased ............................. 18,251,068
Payable for forward foreign currency purchased ............... 12,771
Payable for Fund shares redeemed ............................. 2,551
Advisory fee payable - Note 3 ................................ 221,716
Administration fee payable - Note 3 .......................... 24,361
Shareholder servicing fee payable - Note 4 ................... 81,864
Accrued expenses and other liabilities ....................... 151,229
-----------
TOTAL LIABILITIES ........................................ 18,745,560
-----------
NET ASSETS ............................................... $ 289,812,224
===========
NET ASSETS
Capital paid-in .............................................. $ 290,340,304
Undistributed (distributions in excess of)
net investment income ....................................... (283,646)
Accumulated net realized loss on investments
and foreign currency transactions ........................... (27,948,051)
Net unrealized appreciation of investments
and foreign currency transactions ........................... 27,703,617
-----------
NET ASSETS ............................................... $ 289,812,224
===========
Investor Shares:
Net Assets ................................................. $ 256,208,254
Net asset value, offering and redemption
price per share - Note 5 .................................. $ 11.62
Total shares outstanding at end of period .................... 22,054,648
Advisor Shares:
Net Assets .................................................. $ 33,603,970
Net asset value, offering and redemption
price per share - Note 5 ................................... $ 11.70
Total shares outstanding at end of period .................... 2,872,663
Cost of securities............................................ $ 263,312,790
Cost of foreign currency...................................... $ 3,124,024
</TABLE>
The accompanying notes are an integral part of the financial statements
10
<PAGE>
-------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
APRIL 30, 2000 (UNAUDITED)
INVESTMENT INCOME
<S> <C>
Dividend income .............................................. $ 2,218,254
Interest income .............................................. 120,258
Foreign taxes ................................................ (392,989)
----------
TOTAL INVESTMENT INCOME ................................. 1,945,523
----------
EXPENSES
Investment advisory fees - Note 3 ............................ 1,447,618
Shareholder servicing fees - Note 4 .......................... 47,298
Administrative fees - Note 3 ................................. 144,762
Subadministration Fees - Note 3 .............................. 146,141
Custodian fees ............................................... 328,758
Audit fees ................................................... 20,915
Legal fees ................................................... 20,817
Trustees fees ................................................ 18,338
Transfer agent fees .......................................... 21,404
Amortization of organizational expenses ...................... 3,045
Printing fees ................................................ 4,984
Registration fees ............................................ 10,743
Other.... .................................................... 4,047
-----
TOTAL EXPENSES ........................................... 2,218,870
Expenses borne by Investment Adviser - Note 3 ................ (465,553)
--------
NET EXPENSES .............................................. 1,753,317
----------
NET INVESTMENT INCOME ..................................... 192,206
----------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCY TRANSACTIONS:
Net realized gain on investments sold ........................ 26,554,186
Net realized loss on foreign currency transactions ........... (370,105)
----------
Net realized gain on investments and foreign
currency transactions ....................................... 26,184,081
----------
Change in net unrealized appreciation on
investments ................................................. 4,481,375
Change in net unrealized appreciation on
foreign currency transactions ............................... 98,747
----------
Net change in unrealized appreciation on
investments and foreign currency transactions ............... 4,580,122
----------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS .................................... 30,764,203
----------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ................................... $ 30,956,409
==========
</TABLE>
The accompanying notes are an integral part of the financial statements
11
<PAGE>
-------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
STATEMENTS OF CHANGE IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 2000 FOR THE YEAR ENDED
(UNAUDITED) OCTOBER 31, 1999
------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
<S> <C> <C>
From operations:
Net investment income .............................. $ 192,206 $ 1,565,879
Net realized gain (loss) on investments
and foreign currency transactions ............... 26,184,081 (2,603,747)
Change in net unrealized appreciation
of investments and foreign currency
transactions .................................... 4,580,122 51,243,436
------------- -------------
Net increase in net assets
resulting from operations ....................... 30,956,409 50,205,568
------------- -------------
Distributions to shareholders from:
Net investment income - Investor Shares ........... (2,380,745) (754,552)
Net investment income - Advisor Shares ............ (312,080) (39,323)
------------- -------------
Total distributions to shareholders ............. (2,692,825) (793,875)
------------- -------------
Capital share transactions: (Note 5)
Sale of shares - Investor Shares .................. 59,527,834 84,184,243
Sale of shares - Advisor Shares ................... 4,480,205 10,097,717
Reinvestment of distributions - Investor Shares ... 1,603,580 310,385
Reinvestment of distributions - Advisor Shares .... 312,080 39,323
Redemption of shares - Investor Shares ............ (41,738,526) (24,794,413)
Redemption of shares - Advisor Shares ............. (11,132,499) (2,688,049)
------------- -------------
Net increase from capital share transactions ...... 13,052,674 67,149,206
------------- -------------
TOTAL INCREASE .................................... 41,316,258 116,560,899
Net Assets
Beginning of period ............................... 248,495,966 131,935,067
------------- -------------
End of period ..................................... $ 289,812,224 $ 248,495,966
============= =============
Undistributed (distributions in excess of)
net investment income ............................. $ (283,646) $ 2,216,973
============= =============
OTHER INFORMATION
Investor share transactions: (Note 5)
Sales of shares... ................................ 4,975,562 8,380,380
Reinvestment of distributions ..................... 131,982 33,627
Redemptions of shares ............................. (3,261,650) (2,552,689)
------------- -------------
Net increase in investor shares ................... 1,845,894 5,861,318
============= =============
Advisor share transactions: (Note 5)
Sales of shares.................................... 343,175 1,018,456
Reinvestment of distributions ..................... 25,518 4,849
Redemptions of shares ............................. (863,455) (283,137)
------------- -------------
Net (decrease) increase in advisor shares ......... (494,762) 740,168
============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements
12
<PAGE>
-------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS - INVESTOR SHARES
Selected per share data and ratios for an Investor Share outstanding throughout
each period:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED OCTOBER 31, PERIOD ENDED
APRIL 30, 2000 ----------------------------------------------- OCTOBER 31,
(UNAUDITED) 1999 1998 1997 1996 1995 (a)
------------ ---- ---- ---- ---- -------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE AT BEGINNING OF PERIOD $ 10.53 $ 7.77 $ 11.08 $ 11.06 $ 10.63 $ 10.00
------------ -------- ------- ------- ------- --------
INCOME FROM INVESTMENT OPERATIONS: (b)
Net Investment Income....... 0.01 0.06 0.12 0.06 0.02 0.02
Net Realized and Unrealized
Gain (Loss) on Investments
and Foreign Currency
Transactions............ 1.20 2.75 (3.39) (0.03) 0.43 0.61
------- -------- -------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS 1.21 2.81 (3.27) 0.03 0.45 0.63
------- -------- -------- ------- ------- -------
LESS DISTRIBUTIONS:
From Net Investment Income.. (0.12) (0.05) (0.04) (0.01) (0.02) 0.00
-------- -------- -------- ------- ------- -------
Total Distributions......... (0.12) (0.05) (0.04) (0.01) (0.02) 0.00
-------- -------- -------- ------- ------- -------
NET ASSET VALUE AT END OF PERIOD. $ 11.62 $ 10.53 $ 7.77 $ 11.08 $ 11.06 $ 10.63
======== ======== ======== ======= ======= =======
TOTAL RETURN (c) ............... 11.33% 36.27% (29.64)% 0.27% 4.22% 6.30%
RATIOS & SUPPLEMENTARY DATA
Net Assets at End of Period (000's) $ 256,208 $ 212,859 $ 111,463 $179,436 $167,570 $18,423
Ratios to Average Net Assets: (b)
Expenses including reimbursement/
waiver of fees ........ 1.18% (d) 1.27% 1.36% 1.41% 1.60% 1.58% (d)
Expenses excluding reimbursement/
waiver of fees ..... 1.49% (d) 1.33% 1.64% 1.62% 1.71% 2.45% (d)
Net investment income including
reimbursement/waiver of fees 0.16% (d) 0.85% 1.11% 0.51% 0.36% 0.46% (d)
Portfolio Turnover Rate (e) ........ 65% (f) 77% 67% 43% 103% 44% (f)
</TABLE>
(a) For the period March 31, 1995 (Commencement of Operations) through October
31, 1995. The Fund converted to a master/feeder structure on November 1,
1995.
(b) From November 1, 1995 to May 31, 1999, the Fund recognized its
proportionate share of income, expenses and gains/losses of the underlying
portfolio, Schroder Emerging Markets Fund Institutional Portfolio
(Portfolio). Commencing June 1, 1999, income, expenses and gains/losses
were directly accrued to the Fund.
(c) Total return calculations do not reflect the payment of purchase or
redemption fees of 0.50%, respectively. Total returns would have been
lower had certain Fund expenses not been limited during the periods shown.
(See Note 3). Total return calculations for a period of less than one year
are not annualized.
(d) Annualized.
(e) The portfolio turnover rates for the years after October 31, 1995 through
October 31, 1998 represent the turnover of the underlying portfolio,
Schroder Emerging Markets Fund Institutional Portfolio (Portfolio). For
the year ending October 31, 1999, the rate represents a combination of the
portfolio turnover rate of the Portfolio for the period from November 1,
1998 through May 31, 1999, during which time the Fund invested in the
Portfolio, and the portfolio turnover rate of the Fund for the period June
1, 1999 through October 31, 1999, during which time the Fund held direct
investments in a portfolio of securities.
(f) Not annualized.
The accompanying notes are an integral part of the financial statements.
13
<PAGE>
-------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS - ADVISOR SHARES
Selected per share data and ratios for an Advisor Share outstanding throughout
each period:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED OCTOBER 31, PERIOD ENDED
APRIL 30, 2000 ---------------------- OCTOBER 31,
(UNAUDITED) 1999 1998 1997 (a)
------------ ---- ---- --------
<S> <C> <C> <C> <C>
NET ASSET VALUE AT BEGINNING OF PERIOD...... $ 10.58 $ 7.79 $ 11.11 $ 11.28
-------- ------- ------- ------
INCOME FROM INVESTMENT OPERATIONS: (b)
Net Investment Income (Loss)........... (0.02) 0.05 0.08 0.03
Net Realized and Unrealized Gain (Loss)
on Investments and Foreign Currency
Transactions......................... 1.23 2.75 (3.39) (0.19)
-------- -------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS....... 1.21 2.80 (3.31) (0.16)
------- -------- ------- -------
LESS DISTRIBUTIONS:
From Net Investment Income............. (0.09) (0.01) (0.01) (0.01)
-------- -------- ------- -------
Total Distributions.................... (0.09) (0.01) (0.01) (0.01)
-------- -------- ------- -------
NET ASSET VALUE AT END OF PERIOD............ $ 11.70 $ 10.58 $ 7.79 $ 11.11
======= ======== ======= =======
TOTAL RETURN (c) ........................... 11.44% 36.05% (29.81)% (1.42)%
RATIOS & SUPPLEMENTARY DATA
Net Assets at End of Period (000's).... $ 33,604 $ 35,637 $20,472 $ 25,280
Ratios to Average Net Assets: (b)
Expenses including reimbursement/
waiver of fees ................ 1.43% (d) 1.52% 1.61% 1.66% (d)
Expenses excluding reimbursement/
waiver of fees ................ 1.79% (d) 1.60% 1.97% 2.03% (d)
Net investment income including
reimbursement/waiver of fees .. (0.06)% (d) 0.70% 0.82% 0.27% (d)
Portfolio Turnover Rate (e)............ 65% (g) 77% 67% 43% (f)
</TABLE>
(a) Advisor Shares were first issued on November 21, 1996.
(b) Prior to June 1, 1999, the Fund recognized its proportionate share of
income, expenses and gains/losses of the underlying portfolio, Schroder
Emerging Markets Fund Institutional Portfolio (Portfolio). Commencing June
1, 1999, income, expenses and gains/losses were directly accrued to the
Fund.
(c) Total return calculations do not reflect the payment of purchase or
redemption fees of 0.50%, respectively. Total returns would have been
lower had certain Fund expenses not been limited during the periods shown.
(See Note 3). Total return calculations for a period of less than one year
are not annualized.
(d) Annualized.
(e) The portfolio turnover rates for the periods through October 31, 1998
represent the turnover of the underlying portfolio, Schroder Emerging
Markets Fund Institutional Portfolio (Portfolio). For the year ending
October 31, 1999, the rate represents a combination of the portfolio
turnover of the Portfolio for the period from November 1, 1998 through May
31, 1999, during which time the Fund invested in the Portfolio and the
portfolio turnover rate of the Fund for the period June 1, 1999 through
October 31, 1999, during which time the Fund held direct investments in a
portfolio of securities.
(f) Represents the Portfolio's portfolio turnover rate for the entire fiscal
year ended October 31, 1997.
(g) Not annualized.
The accompanying notes are an integral part of the financial statements.
14
<PAGE>
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (UNAUDITED)
NOTE 1 - ORGANIZATION
Schroder Capital Funds (Delaware) (the "Trust"), is an open-end series
management investment company registered under the Investment Company Act of
1940, as amended. The Trust was organized as a Maryland corporation on July 30,
1969; reorganized as Schroder Capital Funds, Inc., a series company, on
February 29, 1988; and reorganized on January 9, 1996, as a Delaware business
trust. The Trust has an unlimited number of authorized shares, which are
divided into seven investment portfolios. Included in this report is the
Schroder Emerging Markets Fund Institutional Portfolio (the "Fund"), which is a
non-diversified portfolio that commenced operations on March 31, 1995. The
Trust is authorized to issue an unlimited number of the Fund's Investor Shares
and Advisor Shares of beneficial interest without par value. As of April 30
2000, the Fund had both Investor Shares and Advisor Shares outstanding.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Trust which are in conformity with generally accepted accounting principles:
VALUATION OF INVESTMENTS: Portfolio securities listed on recognized stock
exchanges are valued at the last reported sales price on the exchange on which
the securities are principally traded. Listed securities traded on recognized
stock exchanges where last sale prices are not available are valued at the mean
of the closing bid and ask prices ("mid-market price"), or if none, the last
sale price on the preceding trading day. Securities traded in over-the-counter
markets are valued at the most recent reported mid-market price. Short-term
investments having a maturity of 60 days or less, are valued at amortized cost,
which approximates market value unless the investment adviser believes another
valuation is more appropriate. Prices used for valuation generally are provided
by independent pricing services. Other securities and assets for which market
quotations are not readily available are valued at fair value as determined in
good faith using methods approved by the Board of Trustees ("Trustees").
REPURCHASE AGREEMENTS: When entering into repurchase agreements, it is the
Fund's policy that the Fund take into its possession, through its custodian,
the underlying collateral and monitor the collateral's value at the time the
agreement is entered into and on a daily basis during the term of the
repurchase agreement to ensure that it equals or exceeds the repurchase price.
In the event of default or bankruptcy by the other party to the agreement,
realization and/or retention of the collateral may be subject to legal
proceedings.
INVESTMENT TRANSACTIONS: Investment security transactions are recorded as of
trade date. Realized gains and losses on sales of investments are determined
on the basis of identified cost.
INVESTMENT INCOME: Dividend income is recorded on the ex-dividend date except
that certain foreign dividends are recorded as the Fund is informed of the
ex-dividend date. Dividend income is recorded net of unrecoverable withholding
tax. Interest income is recorded on an accrual basis. Foreign dividend and
interest income amounts and realized capital gains or losses are converted to
U.S. dollar equivalents using foreign exchange rates in effect at the date of
the transactions.
EXPENSES: Expenses are recorded on an accrual basis. Most of the expenses of
the Trust can be directly attributable to a specific Fund and/or class of
shares. Expenses not directly attributable to a specific Fund and/or class of
shares are allocated among the Funds and/or classes of shares in such a manner
as deemed equitable by Schroder Investment Management North America Inc.
("SIMNA"), the Fund's investment adviser, or the Trustees.
DISTRIBUTIONS TO SHAREHOLDERS: Distributions to shareholders from net
investment income and common expenses and net realized capital gains are
declared and distributed at least annually. Distributions are recorded on the
ex-dividend date.
15
<PAGE>
-------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Investment income, common expenses of the Fund and gains/losses on investments
are allocated to both classes of the Fund based on the respective daily net
assets of each class. Shareholder servicing fees related to Advisor Shares are
charged directly to that class. Neither class has preferential dividend rights.
Income dividends, if any, paid by the Fund on its two classes of shares will
normally differ in amounts due to the differing expenses borne by each class.
DEFERRED ORGANIZATION COSTS: Costs incurred by the Fund in connection with
its organization are amortized on a straight-line basis over a five-year
period.
FEDERAL INCOME TAXES: It is the policy of the Trust for the Fund to qualify
as a "regulated investment company" by complying with the requirements of
Subchapter M of the Internal Revenue Code of 1986, as amended. By so
qualifying, the Fund will not be subject to federal income taxes to the
extent that, among other things, it distributes substantially all of its
taxable income, including capital gains, for the fiscal year. In addition,
as a result of distributing substantially all of its net investment income
during each calendar year, capital gains and certain other amounts, if any,
the Fund will not be subject to a federal excise tax.
As of October 31, 1999, the Fund had the following net tax basis capital loss
carryforwards for federal income tax purposes, that may be applied against
taxable gains until their expiration date as follows:
<TABLE>
<CAPTION>
Expiration Dates
AMOUNT OCTOBER 31,
------- ----------------
<S> <C>
$ 159,533 2003
6,451,242 2004
6,742,150 2005
35,721,348 2006
2,676,279 2007
</TABLE>
Income and capital gain distributions are determined in accordance with income
tax regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for passive foreign
investment companies, foreign currencies, losses deferred due to wash sales and
excise tax regulations.
FOREIGN CURRENCY: Foreign currency amounts are translated into U.S. dollars at
the mean of the bid and asked prices of such currencies against U.S. dollars as
follows: (i) assets and liabilities at the rate of exchange at the end of the
respective period; and (ii) purchases and sales of securities and income and
expenses at the rate of exchange prevailing on the dates of such transactions.
The portion of the results of operations arising from changes in the exchange
rates and the portion due to fluctuations arising from changes in the market
prices of securities are not isolated. Such fluctuations are included with the
net realized and unrealized gain or loss on investments.
The Fund may enter into forward foreign currency contracts to protect the U.S.
dollar value of the underlying portfolio of securities against the effect of
possible adverse movements in foreign exchange rates. Principal risks
associated with such transactions include the movement in value of the foreign
currency relative to the U.S. dollar and the ability of the counterparty to
perform. Fluctuations in the value of such forward foreign currency contract
transactions are recorded daily as unrealized gain or loss; realized gain or
loss includes net gain or loss on transactions that have terminated by
settlement or by the Fund entering into offsetting commitments.
NOTE 3 - INVESTMENT ADVISORY FEES AND ADMINISTRATION AGREEMENTS
The Trust has entered into an investment advisory agreement with SIMNA. Under
this agreement, SIMNA provides investment management services and is entitled
to receive for its services compensation, payable monthly, at the annual rate
of 1.00% of the Fund's average daily net assets.
The administrator of the Trust is Schroder Fund Advisors Inc. ("Schroder
Advisors"), a wholly owned subsidiary of SIMNA. For its services, Schroder
Advisors is entitled to receive compensation at an annual rate, payable
monthly, of 0.10% of the average daily net assets of the Fund. In addition,
the Trust has entered into a Sub-Administration Agreement with State Street
Bank and Trust Company ("State Street") and Schroder Advisors. Under that
Agreement, the Fund, together with other mutual funds managed by SIMNA and
certain related entities, pays fees to State Street based on the combined
average daily net assets of all of the funds in the Schroder complex,
according to the following annual rates: 0.06% of the first $1.7 billion of
such assets, 0.04% of the next $1.7 billion, and 0.02% of assets in excess
of $3.4 billion, subject to certain minimum requirements.
16
<PAGE>
-------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
In order to limit the Fund's expenses, SIMNA and Schroder Advisors are
contractually obligated to reduce their compensation (and, if necessary, to pay
certain other Fund expenses) until October 31, 2000, to the extent that the
Fund's net expenses attributable to its Investor and Advisor shares exceed
1.18% and 1.43%, respectively (based on the Fund's average daily net assets).
NOTE 4 - SHAREHOLDER SERVICING PLAN
The Trust has adopted a Shareholder Service Plan (the "Plan") for its Advisor
Shares under which Schroder Advisors, or other shareholder servicing
organizations, provide administrative support services to shareholders of the
Fund's Advisor Shares. Providing for, or arranging for, the provision of these
shareholder services, Schroder Advisors receives compensation monthly at an
annual rate of up to 0.25% of the average daily net assets of the Fund
attributable to its Advisor Shares. Schroder Advisors may pay shareholder
servicing organizations for these services at an annual rate of up to 0.25%.
NOTE 5 - PURCHASE AND REDEMPTION FEES
Purchases and redemptions of Fund shares are subjected to a transaction fee of
0.50% of the amount invested and the net asset value redeemed, respectively.
These charges are designed to cover the transaction costs that the Fund incurs
(either directly or indirectly) as a result of its investment in, or sale of,
portfolio securities. These charges, which are not sales charges, are retained
by the Fund and not paid to Schroder Advisors or any other entity. The purchase
and redemption fees are included in the Statements of Changes in Net Assets
shares sold and shares redeemed amounts, respectively, and are included as part
of Capital Paid-in on the Statement of Assets and Liabilities. The purchase and
redemption fees paid to the Fund for each class were as follows:
<TABLE>
<CAPTION>
INVESTOR SHARES ADVISOR SHARES
----------------- ---------------
For the Six Months Ended PURCHASE REDEMPTION PURCHASE REDEMPTION
--------- ---------- -------- ----------
<S> <C> <C> <C> <C>
April 30, 2000 $ 297,639 $ 208,326 $ 22,401 $53,909
For the Year Ended
October 31, 1999 448,181 123,972 55,691 13,440
</TABLE>
NOTE 6 - TRANSACTIONS WITH AFFILIATES
TRUSTEES' FEES: The Trust pays no compensation to Trustees who are interested
persons of the Trust, SIMNA or Schroder Advisors. For their services as
Trustees of all open-end investment companies distributed by Schroder Fund
Advisors Inc., with the exception of Schroder Series Trust II, trustees who are
not interested persons of the Trust, SIMNA or Schroder Fund Advisors Inc. will
receive an annual retainer of $11,000 and $1,250 per meeting attended in person
or $500 per meeting attended by telephone. Members of an Audit Committee for
one or more of such investment companies receive an additional $1,000 per year.
Payment of the annual retainer will be allocated among the various Funds based
on their relative net assets.
NOTE 7 - INVESTMENT TRANSACTIONS
Purchases and proceeds from sales of non-government investments, excluding
short-term securities for the Fund, for the period ended April 30, 2000 were
$182,423,642 and $195,248,918, respectively.
At April 30, 2000, the identified cost for federal income tax purposes of
investments owned by the Fund was $263,312,790 with net unrealized appreciation
of $27,760,138. Gross unrealized appreciation and depreciation were $51,379,136
and $23,618,990, respectively. The aggregate cost of the Fund's investments was
substantially the same for book and federal income tax purposes at April 30,
2000.
17
<PAGE>
-------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
-------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
NOTE 8 - CONCENTRATION OF RISK
The Fund's investment in countries with limited or developing capital markets
may involve greater risks than investments in more developed markets and the
prices of such investments may be volatile. The consequences of political,
social or economic events in these countries may have disruptive effects on the
market prices of the Fund's investments.
For more complete risk disclosure, please refer to the Fund's current
prospectus.
NOTE 9 - BENEFICIAL INTEREST
The Fund had 5 Investor and 2 Advisor shareholders owning beneficially or of
record 78.45% and 98.02% of those classes of shares of the Fund, respectively.
18
<PAGE>
INVESTMENT ADVISER
Schroder Investment Management North America Inc.
787 Seventh Avenue, 34th Floor
New York, NY 10019
TRUSTEES
Sharon L. Haugh, CHAIRMAN
Catherine A. Mazza, VICE CHAIRMAN
David N. Dinkins
Peter E. Guernsey
John I. Howell
Peter S. Knight
William L. Means
Clarence F. Michalis
Hermann C. Schwab
ADMINISTRATOR & DISTRIBUTOR
Schroder Fund Advisors Inc.
787 Seventh Avenue, 34th Floor
New York, NY 10019
TRANSFER & SHAREHOLDER SERVICING AGENT
Boston Financial Data Services, Inc.
CUSTODIAN
State Street Bank and Trust Company
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
COUNSEL
Ropes & Gray
Schroder Emerging Markets Fund Institutional Portfolio
P.O. Box 8507
Boston, MA 02266
800-464-3108
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The information contained in this report is intended for the general
information of the shareholders of the Trust. This report is not authorized
for distribution to prospective investors unless preceded or accompanied by
a current Trust prospectus, which contains important information concerning
the Trust.
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EMI0600SAR
