<PAGE>
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SCHRODER CAPITAL FUNDS (DELAWARE)
--------------------------------------------------------------------------------
December 15, 2000
Dear Shareholder:
We are pleased to present the annual report to shareholders for Schroder
Capital Funds (Delaware) for the fiscal year ended October 31, 2000.
Volatility was the hallmark of the fiscal year under review. The early part
of the period was characterized by a soaring technology sector, robust U.S.
economic growth and higher interest rates in the U.S. and Europe. That
environment changed, however. Technology and other "new economy" stocks lost
much of their luster on the heels of poor earnings reports, and investors began
to rotate into more defensive "old economy" industries. At the same time, global
economic growth began to slow, and U.S. interest rates peaked. Indeed, toward
the end of the fiscal year, concern mounted about higher oil prices, a weak
euro, declining expectations for corporate profits in 2001, and the
vulnerability of some of the technology giants such as IBM, Lucent and Intel.
In general, developed markets performed better than emerging markets during
the period, and among the developed markets, those in Europe fared better than
those in Asia and the Pacific Rim, which were especially susceptible to the
weakness in technology. Emerging markets had been strong early in the period,
but suffered in the face of prospects for slower global economic growth.
Going forward, we expect the Federal Reserve to embark on a modest easing
path. In this setting, we continue to believe that strong fundamental research
around the globe is essential to successful investment management and that times
like these support the case for a disclipined, diversified investment program.
This report includes performance information, the schedule of investments,
comments from portfolio managers, and other relevant information for each Fund.
We encourage you to read the report, and we thank you for making Schroders part
of your investment program.
Sincerely,
/s/ Alexandra Poe
Alexandra Poe
PRESIDENT
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<PAGE>
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SCHRODER INTERNATIONAL FUND
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MANAGEMENT DISCUSSION AND ANALYSIS (AS OF OCTOBER 31, 2000)
PERFORMANCE
Schroder International Fund's Investor Shares had a total return of 8.02%
for the 12 months ended October 31, 2000. The Morgan Stanley Capital
International EAFE Index returned -2.82% for the same period.
Several factors contributed to the Fund's strong performance. Stock
selection, as well as industry and country allocation, proved critical to
achieving solid returns. Currency management also added value.
MARKET BACKGROUND
The fiscal year ended October 31, 2000 was quite a volatile year in
international markets. Developed markets outperformed emerging markets during
the period as a whole, following a steep sell off in emerging markets in the
second half of the fiscal year. As global growth began to slow, emerging markets
became more vulnerable, as many companies in those countries supply consumers in
the developed world. Among developed markets, those in Europe outpaced those in
Asia and the Pacific Rim.
On a sector basis, there was a substantial divergence in performance, as
investors rotated into those areas with more dependable earnings particularly
during the second half of the fiscal year. The "old economy" industries, such as
consumer staples, pharmaceuticals and financials returned to favor and
outperformed in the latter part of the fiscal year. By contrast, the formerly
high-flying technology and telecommunications sectors that were performing
strongly in the first half, retrenched in the face of weaker-than-anticipated
results.
PORTFOLIO REVIEW
The Fund benefited from its country allocations during the period. Earlier
in the fiscal year, we reduced exposure to vulnerable areas of the Fund's
investible universe, particularly in emerging Asian stocks and interest-
sensitive markets of Hong Kong and Singapore. Starting in early March, 2000, we
emphasized European markets because we expected them to remain moderately
sheltered from the effects of the global economic slowdown. In addition, the
weakness in the euro boosted Europe's exports and offset the restrictive impact
of higher interest rates. Over the course of the fiscal year, the Fund benefited
by moving away from global emerging markets and into developed markets. After
locking in the emerging market outperformance through the first quarter, we
trimmed our positions in Asia and Latin America, thus avoiding most of the
disappointment in the area that occurred since March.
From a sector perspective, the Fund benefited from its overweighted position
in the technology, telecommunications and media sectors early in the fiscal year
and from its timely shift into more value-oriented industries, such as
pharmaceuticals and financials. The Fund's top-performing holding was
SANOFI-SYNTHELABO, a French pharmaceutical company. Other names that contributed
to the Fund's performance included DEUTSCHE BANK, UBS and ING. These stocks
performed well despite a series of rate hikes by the European Central Bank to
defend the beleaguered euro. Despite the difficult environment for technology
companies, two of the Fund's holdings in that industry--ALCATEL, a French
telecommunications supplier, and SUMITOMO ELECTRIC--surged during the period.
Our position in NISSAN MOTORS also contributed to the Fund's outperformance. In
addition, the Fund's avoidance of the German, French, British, and Japanese
established telecom companies proved beneficial. Holdings in the technology,
telecommunications and media sectors constrained the Fund's performance. These
stocks included ERICSSON, SONERA, SAMSUNG, CAP GEMINI, CANAL PLUS, and TELEWEST.
Currency management also added value to the Fund during this period. The yen
weakened modestly, contrary to market expectations of a meaningful appreciation
in that currency.
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2
<PAGE>
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SCHRODER INTERNATIONAL FUND
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OUTLOOK
We expect global growth to slow from the peak achieved early in 2000,
reflecting increased interest rates in the U.S. and Europe and higher oil
prices. In this environment, Asia is likely to feel the greatest impact. We
believe that the combination of an anemic Japanese consumer, a more conservative
U.S. consumer and higher oil prices is likely to dim prospects in that region.
We therefore expect Asian markets to underperform their western counterparts
next year. Japanese equities are likely to continue to struggle, as we expect
economic news in Japan to remain lackluster. With fiscal policy options
diminished by the heavy government debt burden, we believe that support for the
economy will shift toward monetary policy and that monetary easing in Japan will
cause some weakening of the yen.
We believe that the European economy is less vulnerable to the global growth
slowdown. Europe enjoys the benefits of an extremely competitive currency, which
should boost exports from the region. We anticipate that European equities will
be superior performers over the coming year, as local market gains should be
enhanced for U.S. investors by gains from an appreciating euro.
We anticipate that emerging market equities are likely to underperform
developed market equities over the next year, as emerging market equities
typically do not perform well in an environment of slowing global growth.
On a sector basis, we expect a continuation of the rotation away from the
telecom and technology areas of the market and toward sectors that have been
overlooked or underappreciated in recent years. Such industries include
pharmaceuticals, retail banks and consumer brands. This trend is consistent with
a market that is seeking more dependable and visible profit growth.
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 DOES 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 OCTOBER 31, 2000.
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3
<PAGE>
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SCHRODER INTERNATIONAL FUND
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
SCHRODER INTERNATIONAL FUND VS. MORGAN STANLEY CAPITAL INTERNATIONAL (MSCI) EAFE
INDEX
<TABLE>
<CAPTION>
INTERNATIONAL FUND MSCI EAFE INDEX
<S> <C> <C>
10/31/90 $10,000 $10,000
11/30/90 $9,542 $9,412
12/31/90 $9,559 $9,568
1/31/91 $9,822 $9,880
2/28/91 $10,584 $10,941
3/31/91 $9,952 $10,288
4/30/91 $10,045 $10,391
5/31/91 $10,002 $10,501
6/30/91 $9,481 $9,733
7/31/91 $9,919 $10,213
8/31/91 $9,666 $10,007
9/30/91 $10,118 $10,573
10/31/91 $10,044 $10,725
11/30/91 $9,561 $10,226
12/31/91 $10,000 $10,756
1/31/92 $10,025 $10,529
2/29/92 $9,899 $10,155
3/31/92 $9,584 $9,487
4/30/92 $9,892 $9,534
5/31/92 $10,447 $10,174
6/30/92 $10,189 $9,694
7/31/92 $9,893 $9,448
8/31/92 $10,018 $10,042
9/30/92 $9,817 $9,847
10/31/92 $9,552 $9,334
11/30/92 $9,489 $9,425
12/31/92 $9,599 $9,476
1/31/93 $9,580 $9,478
2/28/93 $9,790 $9,766
3/31/93 $10,336 $10,619
4/30/93 $11,035 $11,629
5/31/93 $11,136 $11,876
6/30/93 $11,104 $11,693
7/31/93 $11,491 $12,104
8/31/93 $12,235 $12,759
9/30/93 $12,362 $12,473
10/31/93 $12,947 $12,859
11/30/93 $12,470 $11,737
12/31/93 $13,988 $12,586
1/31/94 $14,787 $13,652
2/28/94 $14,460 $13,615
3/31/94 $13,809 $13,030
4/30/94 $14,204 $13,585
5/31/94 $14,217 $13,508
6/30/94 $14,058 $13,700
7/31/94 $14,287 $13,834
8/31/94 $14,874 $14,163
9/30/94 $14,523 $13,718
10/31/94 $14,771 $14,176
11/30/94 $14,105 $13,497
12/31/94 $13,950 $13,583
1/31/95 $13,139 $13,063
2/28/95 $13,088 $13,026
3/31/95 $13,806 $13,839
4/30/95 $14,222 $14,362
5/31/95 $14,473 $14,192
6/30/95 $14,531 $13,945
7/31/95 $15,284 $14,816
8/31/95 $14,825 $14,253
9/30/95 $15,299 $14,533
10/31/95 $15,004 $14,145
11/30/95 $15,105 $14,541
12/31/95 $15,563 $15,128
1/31/96 $15,959 $15,193
2/28/96 $16,133 $15,246
3/31/96 $16,372 $15,571
4/30/96 $16,842 $16,027
5/31/96 $16,842 $15,733
6/30/96 $16,991 $15,824
7/31/96 $16,430 $15,363
8/31/96 $16,553 $15,399
9/30/96 $16,883 $15,811
10/31/96 $16,512 $15,651
11/30/96 $17,139 $16,275
12/31/96 $17,108 $16,068
1/31/97 $16,933 $15,509
2/28/97 $17,381 $15,765
3/31/97 $17,478 $15,823
4/30/97 $17,566 $15,910
5/31/97 $18,744 $16,946
6/30/97 $19,649 $17,883
7/31/97 $19,971 $18,175
8/31/97 $18,199 $16,818
9/30/97 $19,192 $17,761
10/31/97 $17,887 $16,396
11/30/97 $17,556 $16,229
12/31/97 $17,680 $16,372
1/31/98 $18,375 $17,121
2/28/98 $19,461 $18,219
3/31/98 $20,253 $18,781
4/30/98 $20,655 $18,930
5/31/98 $20,796 $18,839
6/30/98 $20,644 $18,983
7/31/98 $20,720 $19,176
8/31/98 $18,299 $16,801
9/30/98 $17,756 $16,287
10/31/98 $18,570 $17,985
11/30/98 $19,450 $18,908
12/31/98 $20,070 $19,655
1/31/99 $20,495 $19,599
2/28/99 $20,216 $19,132
3/31/99 $20,734 $19,932
4/30/99 $21,386 $20,741
5/31/99 $20,681 $19,675
6/30/99 $21,452 $20,443
7/31/99 $22,050 $21,051
8/31/99 $21,891 $21,129
9/30/99 $21,625 $21,343
10/31/99 $22,622 $22,144
11/30/99 $23,831 $22,916
12/31/99 $26,289 $24,974
1/31/00 $25,734 $23,389
2/29/00 $27,137 $24,020
3/31/00 $27,063 $24,951
4/30/00 $25,940 $23,640
5/31/00 $26,130 $23,064
6/30/00 $26,977 $23,965
7/31/00 $26,437 $22,964
8/31/00 $25,940 $23,164
9/30/00 $24,787 $22,038
10/31/00 $24,437 $21,519
</TABLE>
The MSCI EAFE Index is a market weighted index composed of companies
representative of the market structure of certain developed market countries in
Europe, Australia, Asia and the Far East, and reflects dividends reinvested net
of non-recoverable withholding tax.
PERFORMANCE INFORMATION
<TABLE>
<CAPTION>
ONE YEAR ENDED FIVE YEARS ENDED TEN YEARS ENDED
OCTOBER 31, 2000 OCTOBER 31, 2000 OCTOBER 31, 2000
---------------- ---------------- ----------------
<S> <C> <C> <C>
Schroder International Fund--Investor Shares...... 8.02% 10.20%(a) 9.35%(a)
</TABLE>
<TABLE>
<C> <S>
(a) Average annual total return.
</TABLE>
"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
BOTH WILL FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN
INVESTOR'S ORIGINAL COST.
--------------------------------------------------------------------------------
4
<PAGE>
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SCHRODER INTERNATIONAL FUND
--------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF OCTOBER 31, 2000
COUNTRY WEIGHTINGS
<TABLE>
<CAPTION>
COUNTRY % OF NET ASSETS
<S> <C>
------------------------------------------------
United Kingdom 16.6%
Japan 13.1
Germany 12.7
Netherlands 9.3
Switzerland 8.0
France 5.5
Spain 4.4
Italy 4.0
Canada 2.2
Sweden 2.1
Finland 2.0
Australia 0.8
Korea 0.4
South Africa 0.3
Taiwan 0.0
Cash Equivalents and Other
Net Assets 18.6
------
Total 100.0%
======
</TABLE>
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
SECURITY % OF NET ASSETS
<S> <C>
------------------------------------------------
Novartis 3.7%
Vodafone Group 3.2
Glaxo Wellcome 2.9
E.On 2.8
ING Groep 2.7
UBS 2.6
Deutsche Bank 2.3
Munchener Ruckversicherungs 2.2
Telefonaktiebolaget LM
Ericcson "B" Shares 2.1
Endesa 2.1
-----
Total 26.6%
=====
</TABLE>
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5
<PAGE>
--------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND
--------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF OCTOBER 31, 2000)
PERFORMANCE
Schroder Emerging Markets Fund's Investor Shares had a total return of
-10.00% for the 12-month period ended October 31, 2000. The Morgan Stanley
Capital International Emerging Markets Free Index returned -7.7% over the same
period.
The Fund suffered from poor stock selection in Asia, particularly in the
technology sector in India and Korea. Stock selection in Turkey also hurt
performance. Our overweighted positions in Latin America, which experienced an
economic recovery, and in Russia, which benefited from high oil prices, only
partially offset the lackluster performance.
MARKET BACKGROUND
Following strong performance in the first half of the period, emerging
markets gave back their gains. In the 12 months through October 31, emerging
markets generally benefited from more balanced global growth, coupled with
continuing domestic economic recovery and company earnings upgrades. However,
concerns over a possible sharp slowdown in global economic growth, and the
consequent increase in investors' risk aversion, caused emerging markets to
underperform developed markets in the second half of the fiscal year. During the
first half of the period, the global strength of technology stocks drove those
markets with a high concentration of companies in this sector. During the second
half of the period, however, those same markets witnessed significant declines.
Latin America was the strongest region over the period, as equity markets
responded to ongoing domestic improvements, Mexican and Brazilian debt rating
upgrades, falling interest rates, and reduced political risk. The region
benefited from its ongoing economic recovery, although it suffered in the second
half of the period from its close links with the U.S. economy. There was also
positive news on corporate activity in the form of an announcement by TELEFONICA
of Spain that it would buy out minority investors in its Latin American
subsidiaries at a 40% premium to the prevailing share price. Recently, the
region suffered from fears over the potential impact of a crisis in Argentina.
Among the emerging markets, the Asian markets were some of the poorest
performers, mainly because of concerns over slowing export growth. More
specifically, social and political concerns and lack of progress on structural
reform dogged the markets of Southeast Asia. Although the region was helped by a
recovery in economic growth in the first half of the period, it subsequently
suffered from concerns over slowing U.S. economic growth, rising oil prices,
fears over weakening personal computer demand, and consequent moderating
expectations in the semiconductor sector. We anticipate that Asia will suffer
from a U.S. slowdown mainly because of its trade links. On average, exports
represent over one-third of GDP and are sensitive to U.S. demand. Markets also
suffered from country-specific factors, including political instability in
Taiwan and the Philippines. Delays in corporate reform and fears of dilution
through equity issuance also hampered some markets.
Emerging market countries in Europe, the Middle East and Africa (EMEA) were
relatively strong in the second half of the period, as investors switched into
more defensive markets with improving fundamentals and relative insulation from
external events. The best-performing markets were those in which economic
recovery or reform stories protected them from global economic uncertainty. This
may be because their business cycles have lagged, or because domestic
restructuring has opened up new opportunities. Russia responded positively both
to the resignation of Yeltsin, given the improved potential for much-needed
structural reforms, and to higher oil prices, which provided windfall tax
revenues for the government and a substantial current account surplus. Israel
was boosted by strong economic fundamentals, falling interest rates and its high
concentration in the technology sector, although the latter rendered it a victim
of the shakeout in global technology stocks that followed. Recently, Israel
suffered from a breakdown in the peace process--a factor that threatens domestic
economic growth.
--------------------------------------------------------------------------------
6
<PAGE>
--------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND
--------------------------------------------------------------------------------
PORTFOLIO REVIEW
Our core investment philosophy for fiscal 2000 was based on our expectation
for a soft landing for the global economy. We therefore increased the Fund's
exposure to Latin America during the period, favoring Brazil relative to Mexico,
as interest rates were expected to fall further and valuations were compelling.
However, we recently trimmed the Fund's exposure to the region, in light of
concerns about the impact of a possible devaluation and default in Argentina.
Within Asia, the Fund benefited from an overweighted position in the
hardware-dominated markets of Taiwan and Korea, which were boosted by a global
shortage of components. We then reduced the Fund's exposure to these markets,
however, as they suffered from political uncertainty and concerns over a peak in
the semiconductor cycle. Elsewhere in Asia, we favored China, as economic growth
continued to strengthen and should be further bolstered by entry into the World
Trade Organization (WTO) later in 2000.
We retained our underweighted position in EMEA, particularly in Greece and
South Africa, although we favored Russia, which benefited from domestic
restructuring and a high oil price.
OUTLOOK
In the coming months, we believe that more benign economic data from the
U.S. should increase investors' risk tolerance, while local economic and
earnings data are expected to remain strong. Although emerging markets remain
vulnerable to any worsening in the global economic environment or further oil
price increases, we expect that oil price declines and a reduction in interest
rates could act as a catalyst for recovery.
In the longer term, we believe that low relative valuations and generally
positive momentum on reform should further support emerging markets. We
therefore believe that, notwithstanding short-term uncertainty, we can look for
the performance of emerging markets to improve, particularly in those countries
displaying a clear commitment to structural reform.
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 DOES 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 OCTOBER 31, 2000.
--------------------------------------------------------------------------------
7
<PAGE>
--------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
SCHRODER EMERGING MARKETS FUND VS. MORGAN STANLEY CAPITAL INTERNATIONAL (MSCI)
EMERGING MARKETS FREE (EMF) INDEX
<TABLE>
<CAPTION>
EMERGING MARKETS FUND MSCI EMF INDEX
<S> <C> <C>
10/30/97 $10,000 $10,000
10/31/97 $10,010 $10,000
$9,670 $9,635
$10,050 $9,867
$9,370 $9,093
$10,140 $10,043
$10,440 $10,478
4/30/98 $10,470 $10,364
$9,040 $8,944
$8,220 $8,006
$8,630 $8,260
$6,400 $5,871
$6,740 $6,244
10/31/98 $7,360 $6,901
$7,930 $7,475
$8,389 $7,367
$8,359 $7,248
$8,319 $7,319
$9,443 $8,283
4/30/99 $10,858 $9,308
$10,657 $9,254
$12,232 $10,304
$12,252 $10,024
$12,403 $10,115
$12,032 $9,773
10/31/99 $12,232 $9,981
$13,095 $10,876
$15,088 $12,259
$15,288 $12,332
$15,633 $12,495
$16,241 $12,556
4/30/00 $14,123 $11,366
$13,631 $10,896
$13,998 $11,280
$13,243 $10,700
$13,484 $10,752
$11,995 $9,813
10/31/00 $10,999 $9,102
</TABLE>
The MSCI EMF Index is an unmanaged market capitalization index of companies
representative of the market structure of 25 emerging countries in Europe, Latin
America and the Pacific Basin. The Index reflects actual buyable opportunities
for the non-domestic investor by taking into account local market restrictions
on share ownership by foreigners. For periods prior to November 30, 1998,
returns represent MSCI EMF (ex-Malaysia).
PERFORMANCE INFORMATION
<TABLE>
<CAPTION>
ONE YEAR ENDED INCEPTION TO
OCTOBER 31, 2000 OCTOBER 31, 2000*
---------------- -----------------
<S> <C> <C>
Schroder Emerging Markets Fund--Investor Shares............. -10.00% 3.22%
</TABLE>
<TABLE>
<C> <S>
* Average annual total return from commencement of Fund
operations (October 31, 1997)
</TABLE>
"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
BOTH WILL FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN
INVESTOR'S ORIGINAL COST.
--------------------------------------------------------------------------------
8
<PAGE>
--------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND
--------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF OCTOBER 31, 2000
COUNTRY WEIGHTINGS
<TABLE>
<CAPTION>
COUNTRY % OF NET ASSETS
<S> <C>
------------------------------------------------
Korea 13.4%
Brazil 11.3
Hong Kong 10.5
Mexico 10.4
Taiwan 9.0
South Africa 5.4
Turkey 4.8
Israel 4.4
Russia 3.9
India 3.1
Greece 2.1
Malaysia 1.7
China 1.6
Thailand 1.5
Poland 1.4
Hungary 1.4
Indonesia 1.3
Chile 1.1
Egypt 0.6
Zimbabwe 0.5
Phillipines 0.5
Czech Republic 0.4
Argentina 0.4
Peru 0.2
Cash Equivalents and Other
Net Assets 9.1
------
Total 100.0%
======
</TABLE>
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
SECURITY % OF NET ASSETS
<S> <C>
------------------------------------------------
Telefonos de Mexico ADR 4.5%
Samsung Electronics 3.7
Korea Electric Power (KEPCO)
ADR 3.6
China Unicom 3.3
China Mobile (Hong Kong) 3.2
Korea Telecom ADR 2.6
Taiwan Semiconductor
Manufacturing 2.4
Brilliance China Automotive
Holdings 2.1
Check Point Software
Technologies 2.1
SK Telecom. Krw500 1.9
-----
Total 29.4%
=====
</TABLE>
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9
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF OCTOBER 31, 2000)
PERFORMANCE
The Schroder International Smaller Companies Fund's Investor Shares had a
total return of 22.37% over the 12 months ended October 31, 2000. The Salomon
Smith Barney EMI EPAC Index fell by 2.2% over the same period.
Stock selection was the key to strong relative performance throughout the
period. Country allocation and currency hedging also made modest positive
contributions.
MARKET BACKGROUND
Smaller companies in the U.K. exhibited the strongest performance over the
fiscal year. Growth remained fairly subdued, but optimism over interest rate
cuts increased through the period, and a modest retracement of previous strength
in sterling supported equities. A high level of merger and acquisition activity
also buoyed values in this sector.
Continental European smaller companies offered positive returns in dollar
terms, despite the weakness of the euro. Economic growth remained healthy,
although a maturing of the cycle was evident in the ECB-led increases in
short-term interest rates. The first half of the fiscal year witnessed a
continuation of the strength in "new economy" stocks--a trend that came to an
abrupt halt in March and April, as investors sought exposure to more traditional
market sectors.
In Asia, smaller companies turned in a particularly disappointing
performance. Hong Kong and Singapore retrenched, following the strong gains seen
in 1999, as the pace of economic growth flattened out after the strong recovery
from the 1997-98 crisis. During the second half of the fiscal year, the rising
concerns over the technology manufacturing cycle and the impact of slower U.S.
growth on Asian exports further depressed sentiment.
In Japan, the start of the fiscal year coincided with a period of weak
economic data. Although corporate results generally exceeded expectations, and
the economy recovered somewhat over the course of 2000, largely because of
strong private capital spending, equities still struggled. Foreign investors
were net sellers, reversing their stance of the previous 12 months, while
domestic investors showed little enthusiasm for equities. Following a strong
calendar 1999, growth stocks performed very poorly, reacting to the excessive
peak valuations.
PORTFOLIO REVIEW
Through most of the period, the Fund maintained an overweight position in
Continental European equities, balanced by underweight positions in the U.K. and
Japan. This positioning was balanced at the end of the period by a temporarily
high cash position, which has since been reduced.
In Europe, we trimmed the Fund's exposure to the technology sectors in the
second half of the fiscal year, but remained overweighted. Sales in the sector
included ENDEMOL ENTERTAINMENT, a Dutch content provider, MODERN TIMES GROUP, a
Swedish media company, and the partial sale of INFOGRAMES, a French console game
designer. We sought out growth opportunities in other areas such as healthcare,
with the purchase of QIAGEN (a Dutch manufacturer of DNA purification
equipment), BIACORE (a Swedish supplier of pre-clinical screening equipment),
and MAXIM PHARMACEUTICAL.
With valuations becoming more reasonable following the decline in the "new
economy" sectors in Japan, we made selected purchases in this area late in the
fiscal year. New holdings included BELLSYSTEM24 (a call center
--------------------------------------------------------------------------------
10
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
operator) and KADOKAWA SHOTEN, a content provider. Elsewhere, we continued our
focus on areas of secular growth in both healthcare (TORII PHARMACEUTICAL), and
in specialty retailing, where new purchases included UNITED ARROWS (fashion
retailing) and KOMERI (home centers).
Reflecting the prospect of a less supportive global growth environment, we
pursued areas of defensive growth in the Pacific (ex Japan) portion of the
Fund's portfolio. New purchases included SINGAPORE AIRPORT TERMINAL SERVICES and
SIA ENGINEERING, which we believe will continue to benefit from the long-term
growth in air traffic in the region, a trend which we believe will continue
regardless of the global economic cycle.
In the United Kingdom, we remained generally cautious, particularly on the
technology sector, where we believed that valuations generally were unattractive
-- especially compared with similar companies in continental Europe. We
increased the Fund's exposure in the media sector, with new holdings in STERLING
PUBLISHING, JOHNSTON PRESS, and SCOTTISH RADIO HOLDINGS.
OUTLOOK
In general, smaller company equities do not perform well in periods of
slowing world economic activity and general caution toward equities. In a number
of markets, smaller company stocks displayed greater sensitivity to the economic
cycle than did their larger counterparts, and the inferior liquidity of small
cap stocks can amplify stock price movements. On a more positive note, the
valuations of smaller companies remain lower relative to those of larger names
and offer at least comparable earnings growth. Furthermore, although world
growth is set to slow, inflation pressures remain benign, despite the strength
of oil prices. The U.S. and, to a lesser extent, Europe, enjoy a high degree of
maneuverability in terms of both monetary and fiscal policy. This provides some
level of comfort that a soft landing may be achieved and therefore limits the
adverse impact upon corporate profits generally.
We continue to take a very selective approach to investing in smaller
equities, focusing on companies that offer exposure to sectors and markets that
offer secular and visible growth regardless of economic cycles.
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 DOES 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 OCTOBER 31, 2000.
--------------------------------------------------------------------------------
11
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND VS.
SALOMON SMITH BARNEY EXTENDED MARKET INDEX (EMI) (EUROPE PACIFIC BASIN
COUNTRIES)
<TABLE>
<CAPTION>
INTERNATIONAL SMALLER SALOMON SMITH BARNEY
<S> <C> <C>
COMPANIES FUND EMI EPAC INDEX
11/4/96 $10,000 $10,000
11/30/96 $9,970 $10,147
12/31/96 $9,918 $9,962
1/31/97 $9,527 $9,697
2/28/97 $9,678 $9,875
3/31/97 $9,638 $9,765
4/30/97 $9,357 $9,620
5/31/97 $9,998 $10,227
6/30/97 $10,288 $10,469
7/31/97 $9,948 $10,265
8/31/97 $9,477 $9,804
9/30/97 $9,568 $9,932
10/31/97 $9,227 $9,542
11/30/97 $8,757 $9,162
12/31/97 $8,517 $8,939
1/31/98 $9,177 $9,357
2/28/98 $9,688 $10,050
3/31/98 $10,241 $10,522
4/30/98 $10,763 $10,607
5/31/98 $11,306 $10,852
6/30/98 $11,263 $10,546
7/31/98 $11,530 $10,521
8/31/98 $10,060 $9,287
9/30/98 $9,528 $9,007
10/31/98 $9,954 $9,650
11/30/98 $10,295 $9,968
12/31/98 $10,729 $10,202
1/31/99 $10,925 $10,162
2/28/99 $11,478 $9,974
3/31/99 $12,076 $10,331
4/30/99 $13,078 $10,860
5/31/99 $12,963 $10,571
6/30/99 $14,574 $10,928
7/31/99 $15,887 $11,349
8/31/99 $16,393 $11,523
9/30/99 $16,163 $11,486
10/31/99 $16,462 $11,390
11/30/99 $18,431 $11,791
12/31/99 $20,417 $12,545
1/31/00 $22,794 $12,217
2/29/00 $26,755 $12,653
3/31/00 $25,704 $12,762
4/30/00 $22,755 $11,960
5/31/00 $21,236 $11,758
6/30/00 $22,509 $12,519
7/31/00 $21,911 $12,080
8/31/00 $22,677 $12,400
9/30/00 $22,067 $11,784
10/31/00 $20,132 $11,145
</TABLE>
The Salomon Smith Barney EMI EPAC Index is an unmanaged index representing the
portion of the Salomon Smith Barney Broad Market Index related to companies with
small index capitalization in approximately 22 European and Pacific Basin
countries. The Salomon Smith Barney EMI EPAC Index represents the smallest
companies in each country based on the total market capital having in the
aggregate 20% of the cumulative available market capital in such country.
PERFORMANCE INFORMATION
<TABLE>
<CAPTION>
ONE YEAR ENDED INCEPTION TO
OCTOBER 31, 2000 OCTOBER 31, 2000*
---------------- -----------------
<S> <C> <C>
Schroder International Smaller Companies Fund--Investor
Shares.................................................... 22.37% 19.16%
</TABLE>
<TABLE>
<C> <S>
* Average annual total return from commencement of Fund
operations (November 4, 1996)
</TABLE>
"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
BOTH WILL FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN
INVESTOR'S ORIGINAL COST.
--------------------------------------------------------------------------------
12
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF OCTOBER 31, 2000
COUNTRY WEIGHTINGS
<TABLE>
<CAPTION>
COUNTRY % OF NET ASSETS
<S> <C>
------------------------------------------------
United Kingdom 22.5%
Japan 21.2
Germany 11.2
France 9.9
Netherlands 5.5
Sweden 5.0
Singapore 3.8
Italy 2.4
Spain 2.4
Ireland 2.0
Switzerland 1.3
Finland 1.1
Hong Kong 0.9
Austria 0.7
Luxembourg 0.4
Cash Equivalents and Other
Net Assets 9.7
------
Total 100.0%
======
</TABLE>
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
SECURITY % OF NET ASSETS
<S> <C>
------------------------------------------------
MLP 1.9%
Energiekontor 1.8
De Rigo ADR 1.6
Low & Bonar 1.5
Galen Holdings 1.5
Fairey Group 1.5
Genesys 1.5
SmartForce ADR 1.4
Renishaw 1.4
Sterling Publishing Group 1.3
-----
Total 15.4%
=====
</TABLE>
--------------------------------------------------------------------------------
13
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. LARGE CAP EQUITY FUND
--------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF OCTOBER 31, 2000)
PERFORMANCE
Schroder U.S. Large Cap Equity Fund's* Investor Shares had a total return of
18.73% for the fiscal year ended October 31, 2000. The S&P 500 Index rose by
6.08% over the same period.
Both stock selection and relative sector weights contributed to the Fund's
strong performance relative to the Index. Specifically, stock selection in
technology, capital goods, and utilities benefited the Fund, as did an
underweighted position in communication services, an overweighted position in
healthcare, and a significantly overweighted position in technology during the
first half of the year. The largest constraint on the Fund's relative
performance was an overweighted position in consumer cyclicals, particularly
shares of retailers, which lagged the market for most of 2000.
MARKET BACKGROUND
Technology shares dominated investor attention throughout the fiscal year.
Enthusiasm for the new economy, e-commerce, and the Internet propelled the
technology sector and the technology-heavy Nasdaq Composite Index to all-time
highs in March, 2000. By late spring, however, investors began to question the
lofty price/earnings multiples afforded technology issues in an environment of
still-sizzling U.S. economic growth and rising interest rates. The Nasdaq
Composite Index once again led the broader market--but this time, it led the
market lower. In August, markets got a lift from some long-awaited signs of
cooling economic growth, a restrained Federal Reserve Bank, and increased
conviction that an economic soft landing was attainable. By the end of August,
the Nasdaq Composite Index had regained more than half its loss from March
highs, and technology issues again outperformed, as investors sought secular
top-line growth amid slowing cyclical economic growth.
The summer rally proved fleeting, however. Most of the major averages
tumbled lower toward the Fund's fiscal year-end, amid concerns surrounding
rising energy prices, a weak euro, declining expectations for 2001 corporate
profits, and recognition that many fast-growing but highly valued technology
issues were not immune from a cyclical slowdown. In general, investors sought
more defensive sectors of the market. Technology and communication services
shares were among the worst performers in the second half of the fiscal year,
while utilities were among the best performers. Superior long-term stable
earnings growth attracted investors to healthcare also. Relatively attractive
valuations and the belief that short-term interest rates had peaked propelled
financials significantly higher, as well, over this period.
PORTFOLIO REVIEW
For the fiscal year as a whole, stock selection in technology drove both
absolute and relative performance, despite that sector's second-half decline.
The largest contributors to performance were ANALOG DEVICES, ADC
TELECOMMUNICATIONS, and NETWORK SOLUTIONS. ANALOG DEVICES benefited from
improving fundamentals for computer chip companies in late 1999 and early 2000.
The fast pace of growth in the telecommunications sector spurred the performance
of ADC TELECOMMUNICATIONS. The explosion in growth of the Internet and
e-commerce drove NETWORK SOLUTIONS. SYMBOL TECHNOLOGIES, which provides wireless
and mobile information management technologies, and CELESTICA, which provides
manufacturing technology and service solutions for circuit and system assembly,
also
* On September 11, 2000, the assets of the Schroder Large Capitalization Equity
Fund (a series of Schroder Series Trust) were transferred to the Schroder U.S.
Diversified Growth Fund in exchange for shares of that Fund. At the same time,
the surviving Fund was renamed SCHRODER U.S. LARGE CAP EQUITY FUND.
--------------------------------------------------------------------------------
14
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. LARGE CAP EQUITY FUND
--------------------------------------------------------------------------------
contributed to the Fund's performance, as both benefited from the increased
importance of technology in business and commerce. All five issues were sold
after the first half of the fiscal year, as the Fund took profits in
technology-related shares and reduced its overall technology allocation.
The biggest detractors to the Fund's performance were also in the technology
sector. LSI LOGIC, a manufacturer of integrated circuits and systems, reported
second-quarter earnings below expectations and also suffered from the generally
negative sentiment for chipmakers. Second-quarter earnings results for NOVELL, a
provider of software for network systems, were half of what was forecast, as a
result of pressures from the introduction of MICROSOFT'S Windows 2000 and
increasing interest in LINUX. INTEL, the leading producer of microprocessors for
personal computers, missed forecasts for its third-quarter earnings, reflecting
an earlier inventory buildup and a general slowing in personal computer sales
growth. The positions in both LSI LOGIC and NOVELL were liquidated as part of
the Fund's move to more defensive sectors. INTEL, however, remains a long-term
core holding, and while near-term pressures could continue, we believe that the
outlook for its Pentium IV processor and the potential for further inroads into
the server business remains positive.
OUTLOOK
The Fund's portfolio is positioned more defensively than it was a year ago.
Sector weights, in general, are closer to those of the S&P 500 Index; marginal
differences reflect the Fund's view of economic risks going forward. Against a
backdrop of potentially disappointing corporate profit growth in 2001, the
Fund's portfolio remains underweighted in technology and consumer cyclicals. We
favor financials, because we believe that short-term interest rates have peaked.
We also remain overweighted in healthcare issues relative to the benchmark,
given the visibility and consistency of their earnings. As always, our
investment goal for the Fund is to provide competitive returns while managing
portfolio risk. We continue to utilize our research resources to identify those
companies with both visible prospects for earnings growth and attractive
valuations.
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 DOES 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 OCTOBER 31, 2000.
--------------------------------------------------------------------------------
15
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. LARGE CAP EQUITY FUND
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
SCHRODER U.S. LARGE CAP EQUITY FUND VS. STANDARD & POOR'S (S&P) 500 INDEX
<TABLE>
<CAPTION>
U.S. LARGE CAP EQUITY FUND S&P 500 INDEX
<S> <C> <C>
10/90 $10,000 $10,000
11/90 $10,652 $10,643
12/90 $10,923 $10,935
1/91 $11,296 $11,420
2/91 $12,229 $12,236
3/91 $12,545 $12,525
4/91 $12,531 $12,560
5/91 $12,976 $13,099
6/91 $12,445 $12,500
7/91 $13,137 $13,085
8/91 $13,860 $13,393
9/91 $13,599 $13,176
10/91 $13,815 $13,353
11/91 $13,323 $12,813
12/91 $15,102 $14,279
1/92 $14,779 $14,015
2/92 $15,040 $14,194
3/92 $14,764 $13,917
4/92 $14,964 $14,323
5/92 $15,134 $14,401
6/92 $14,471 $14,192
7/92 $15,274 $14,764
8/92 $15,196 $14,466
9/92 $15,831 $14,633
10/92 $16,265 $14,686
11/92 $16,837 $15,182
12/92 $17,401 $15,382
1/93 $17,469 $15,495
2/93 $17,228 $15,704
3/93 $18,035 $16,043
4/93 $17,503 $15,650
5/93 $18,103 $16,071
6/93 $17,846 $16,125
7/93 $17,657 $16,047
8/93 $18,569 $16,558
9/93 $18,896 $16,437
10/93 $19,431 $16,772
11/93 $19,138 $16,614
12/93 $19,574 $16,819
1/94 $19,776 $17,385
2/94 $19,687 $16,914
3/94 $18,568 $16,177
4/94 $18,949 $16,384
5/94 $18,949 $16,653
6/94 $18,324 $16,245
7/94 $18,681 $16,778
8/94 $19,419 $17,465
9/94 $18,860 $17,039
10/94 $19,039 $17,423
11/94 $18,056 $16,788
12/94 $18,555 $17,037
1/95 $18,649 $17,478
2/95 $19,459 $18,160
3/95 $19,817 $18,696
4/95 $20,197 $19,245
5/95 $20,817 $20,015
6/95 $21,223 $20,479
7/95 $22,391 $21,159
8/95 $22,176 $21,212
9/95 $22,772 $22,107
10/95 $22,415 $22,028
11/95 $23,486 $22,995
12/95 $23,756 $23,439
1/96 $24,388 $24,235
2/96 $24,471 $24,461
3/96 $25,183 $24,696
4/96 $25,347 $25,059
5/96 $25,813 $25,705
6/96 $25,483 $25,803
7/96 $24,331 $24,662
8/96 $25,100 $25,183
9/96 $26,746 $26,601
10/96 $26,773 $27,335
11/96 $29,242 $29,401
12/96 $28,859 $28,819
1/97 $30,515 $30,620
2/97 $30,652 $30,859
3/97 $28,856 $29,588
4/97 $29,857 $31,354
5/97 $31,515 $33,251
6/97 $32,791 $34,741
7/97 $35,378 $37,506
8/97 $33,238 $35,406
9/97 $34,723 $37,346
10/97 $33,859 $36,099
11/97 $35,135 $37,770
12/97 $35,585 $38,420
1/98 $34,877 $38,846
2/98 $37,765 $41,647
3/98 $39,846 $43,779
4/98 $40,037 $44,221
5/98 $38,379 $43,461
6/98 $40,555 $45,225
7/98 $39,229 $44,741
8/98 $31,564 $38,272
9/98 $34,310 $40,725
10/98 $36,866 $44,036
11/98 $38,853 $46,705
12/98 $43,395 $49,395
1/99 $45,691 $51,459
2/99 $43,397 $49,859
3/99 $44,113 $51,853
4/99 $44,903 $53,860
5/99 $45,046 $52,589
6/99 $49,063 $55,508
7/99 $46,911 $53,776
8/99 $46,337 $53,512
9/99 $45,620 $52,046
10/99 $48,275 $55,341
11/99 $49,781 $56,475
12/99 $56,813 $59,790
1/00 $51,780 $56,789
2/00 $56,647 $55,715
3/00 $59,485 $61,164
4/00 $59,485 $59,323
5/00 $55,589 $58,107
6/00 $56,319 $59,543
7/00 $55,751 $58,614
8/00 $60,133 $62,254
9/00 $57,657 $58,967
10/00 $57,310 $58,719
</TABLE>
The S&P 500 Index is a market capitalization value weighted composite index of
500 large capitalization U.S. companies and reflects the reinvestment of
dividends.
PERFORMANCE INFORMATION
<TABLE>
<CAPTION>
ONE YEAR ENDED FIVE YEARS ENDED TEN YEARS ENDED
OCTOBER 31, 2000 OCTOBER 31, 2000 OCTOBER 31, 2000
---------------- ---------------- ----------------
<S> <C> <C> <C>
Schroder U.S. Large Cap Equity Fund (a)--Investor
Shares......................................... 18.73% 20.66% (b) 19.08% (b)
</TABLE>
<TABLE>
<C> <S>
(a) Formerly Schroder U.S. Diversified Growth Fund.
(b) Average annual total return.
</TABLE>
"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
BOTH WILL FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN
INVESTOR'S ORIGINAL COST.
--------------------------------------------------------------------------------
16
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. LARGE CAP EQUITY FUND
--------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF OCTOBER 31, 2000
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
SECURITY % OF NET ASSETS
<S> <C>
------------------------------------------------
General Electric 4.1%
American International Group 3.6
Federal National Mortgage
Association 3.6
Cisco Systems 3.6
Citigroup 3.6
Microsoft 3.5
Time Warner 3.4
Emerson Electric 3.4
Pfizer 3.3
Anheuser Busch 3.0
-----
35.1%
=====
</TABLE>
INVESTMENTS BY SECTOR
<TABLE>
<CAPTION>
SECTOR % OF NET ASSETS
<S> <C>
------------------------------------------------
Basic Materials 1.9%
Capital Goods 9.7
Computer Hardware 15.7
Computer Services 2.2
Computer Software 5.6
Consumer Cyclicals 5.3
Consumer Staples 10.1
Energy 6.6
Financial Services 20.1
Health Care 13.2
Telecommunications 6.0
Utilities 2.8
Cash Equivalents and Other
Net Assets 0.8
------
Total 100.0%
======
</TABLE>
--------------------------------------------------------------------------------
17
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF OCTOBER 31, 2000)
PERFORMANCE
The Schroder U.S. Smaller Companies Fund's Investor Shares had a total
return of 40.81% for the 12 months ended October 31, 2000, outpacing the Russell
2000 Index, which returned 17.42% during the same time period.
MARKET BACKGROUND
The past fiscal year was both rewarding and eventful for U.S. smaller
companies. From the end of October, 1999 to the middle of March 2000, smaller
companies staged a dramatic rally, with the Russell 2000 Index rising by over
40%. This substantial rise, however, was followed by a sharp decline through
mid-April. Smaller companies, and the market as a whole, then staged
intermittent rallies through this past summer, only to sell off precipitously
again in October 2000. Most noteworthy was the continued decline in technology
stocks, particularly many of the high-flying Internet stocks, many of which lost
most of their market value. While our Fund trailed the index during the advance,
it generated significant positive returns, and generally held on to those gains,
while the market as a whole declined sharply.
PORTFOLIO REVIEW
During the past fiscal year, as in prior periods, we continued to emphasize
growing and profitable companies that trade at reasonable valuations. In
technology, this meant that we avoided the boom and bust cycle of Internet and
wireless, focusing instead on infrastructure plays, such as semiconductors and
components. During the year, the Fund realized substantial profits from its
investments in semiconductor manufacturers, such as INTEGRATED DEVICE
TECHNOLOGIES AND GENERAL SEMICONDUCTOR, and tower operators, SBA COMMUNICATIONS
and PINNACLE HOLDINGS. While the Fund continued to maintain significant exposure
to technology, we shifted attention to healthcare toward the end of the period
under review. We concentrated on service providers, most notably hospital
companies, such as UNIVERSAL HEALTH SERVICES and COMMUNITY HEALTH SYSTEMS,
clinical lab operators, QUEST DIAGNOSTICS and LABORATORY CORP AMERICA, and drug
distributors, AMERISOURCE, BERGEN BRUNSWIG and BINDLEY WESTERN. All of these
companies were very profitable and contributed significantly to performance.
In addition to healthcare and technology, the Fund benefited greatly from
its overweighted position in the energy sector. Oil service holdings, such as BJ
SERVICES, COOPER CAMERON and WEATHERFORD INTERNATIONAL, climbed sharply as a
result of rising oil and gas prices. Finally, our financial holdings also
boosted performance, as our concentration in niche companies, such as auto
lender AMERICREDIT, and asset manager, AFFILIATED MANAGERS GROUP, outperformed
both their sector and the market as a whole.
By far the biggest drag on performance was the consumer sector. Accounting
fraud at RENTWAY AND AURORA FOODS and earnings disappoints from PAPA JOHNS
INTERNATIONAL and HOLLYWOOD ENTERTAINMENT hurt the Fund's overall performance.
OUTLOOK
Looking forward, we continue to search for companies that can expand their
earnings independently of the economic cycle. We believe that many smaller
companies offer more attractive investment opportunities than do large companies
based on valuations and growth rates. Although the near-term interest rate and
economic outlook is murky, the market is showing signs of being driven more by
fundamentals --a positive sign for the Fund's style of investing. Yet given the
impact of a slowing economy and high oil and gas prices, we will remain cautious
on
--------------------------------------------------------------------------------
18
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
the consumer sector, as we are uncertain as to the strength of the all-important
Christmas shopping season. We will remain focused on individual stock selection,
concentrating on underfollowed and misunderstood companies that may offer
superior earnings growth.
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 DOES 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 OCTOBER 31, 2000
--------------------------------------------------------------------------------
19
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
SCHRODER U.S. SMALLER COMPANIES FUND VS. RUSSELL 2000 INDEX
<TABLE>
<CAPTION>
U.S. SMALLER COMPANIES FUND RUSSELL 2000 INDEX
<S> <C> <C>
8/1/93 $10,000 $10,000
$10,350 $10,432
$10,820 $10,726
10/31/93 $10,990 $11,002
$10,710 $10,640
$11,202 $11,004
$11,656 $11,349
$11,807 $11,308
$11,222 $10,711
4/30/94 $11,374 $10,775
$11,343 $10,654
$11,142 $10,292
$11,273 $10,460
$11,918 $11,043
$11,666 $11,007
10/31/94 $11,897 $10,964
$11,384 $10,521
$11,701 $10,804
$11,753 $10,668
$12,380 $11,111
$12,756 $11,303
4/30/95 $13,090 $11,553
$13,383 $11,752
$13,957 $12,362
$15,117 $13,074
$15,681 $13,345
$16,224 $13,584
10/31/95 $15,817 $12,976
$16,684 $13,521
$17,444 $13,878
$17,360 $13,863
$17,835 $14,296
$18,785 $14,587
4/30/96 $19,973 $15,368
$21,160 $15,973
$20,460 $15,317
$18,916 $13,980
$19,498 $14,792
$20,614 $15,370
10/31/96 $20,460 $15,134
$21,125 $15,757
$21,331 $16,170
$21,720 $16,493
$21,720 $16,094
$20,942 $15,335
4/30/97 $21,012 $15,378
$23,473 $17,088
$24,836 $17,821
$26,022 $18,649
$26,588 $19,076
$28,376 $20,473
10/31/97 $27,084 $19,574
$26,872 $19,447
$27,060 $19,787
$26,538 $19,474
$28,298 $20,914
$30,058 $21,775
4/30/98 $30,097 $21,895
$28,550 $20,715
$28,588 $20,758
$26,615 $19,079
$21,393 $15,374
$21,934 $16,578
10/31/98 $22,766 $17,254
$24,139 $18,158
$24,563 $19,282
$24,078 $19,539
$22,508 $17,956
$22,527 $18,236
4/30/99 $24,001 $19,870
$24,815 $20,160
$26,385 $21,071
$26,036 $20,494
$24,621 $19,736
$24,699 $19,740
10/31/99 $24,795 $19,821
$26,210 $20,447
$27,781 $22,761
$27,586 $22,395
$29,661 $26,092
$32,820 $24,373
4/30/00 $32,898 $22,906
$31,579 $21,570
$33,537 $23,451
$33,188 $22,696
$36,658 $24,428
$36,135 $23,710
10/31/00 $34,894 $22,655
</TABLE>
The Russell 2000 Index is a market capitalization weighted broad based index of
2000 small capitalization U.S. companies.
PERFORMANCE INFORMATION
<TABLE>
<CAPTION>
ONE YEAR ENDED FIVE YEARS ENDED INCEPTION TO
OCTOBER 31, 2000 OCTOBER 31, 2000 OCTOBER 31, 2000*
---------------- ---------------- -----------------
<S> <C> <C> <C>
Schroder U.S. Smaller Companies Fund--Investor
Shares......................................... 40.81% 17.15%(a) 18.85%
</TABLE>
<TABLE>
<C> <S>
(a) Average annual total return.
* Average annual total return from commencement of Fund
operations (August 6, 1993)
</TABLE>
"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
BOTH WILL FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN
INVESTOR'S ORIGINAL COST.
--------------------------------------------------------------------------------
20
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF OCTOBER 31, 2000
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
SECURITY % OF NET ASSETS
<S> <C>
------------------------------------------------
Perkinelmer 2.1%
Affiliated Computer Services 1.9
Amphenol 1.8
Affiliated Managers Group 1.7
Alliant Techsystems 1.5
Medicis Pharmaceutical
Class A 1.4
Renal Care Group 1.4
Abercrombie & Fitch Class A 1.3
Sybase 1.3
National Data 1.3
------
Total 15.7%
======
</TABLE>
INVESTMENTS BY SECTOR
<TABLE>
<CAPTION>
SECURITY % OF NET ASSETS
<S> <C>
------------------------------------------------
Basic Materials 1.1%
Business Services 1.9
Capital Goods 5.1
Consumer Cyclicals 9.8
Energy 7.1
Finance 11.2
Health Care 21.2
Media 1.7
Technology 17.3
Technology - Cellular/
Telecommunications 0.7
Technology - Semiconductors 5.3
Technology - Software 3.1
Transportation 0.9
Utilities 1.9
Cash Equivalents and Other Net
Assets 11.7
------
Total 100.0%
======
</TABLE>
--------------------------------------------------------------------------------
21
<PAGE>
--------------------------------------------------------------------------------
SCHRODER MICRO CAP FUND
--------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF OCTOBER 31, 2000)
PERFORMANCE
The Schroder Micro Cap Fund's Investor Shares had a total return of 154.40%
for the 12 months ended October 31, 2000, compared with a 17.42% return for the
Russell 2000 Index for the same time period.
MARKET BACKGROUND
The past fiscal year was both rewarding and eventful for U.S. smaller
companies. From the end of October 1999 to the middle of March 2000 smaller
companies staged a dramatic rally, with the Russell 2000 Index rising by over
40%. This substantial rise was followed by a sharp decline through mid-April.
Smaller companies, and the market as a whole, then staged intermittent rallies
through the summer, only to sell off precipitously again come October 2000. Most
noteworthy was the continued decline in technology stocks, particularly many of
the high-flying Internet stocks, many of which lost most of their market value.
PORTFOLIO REVIEW
During the past year, as in prior periods, we continued to emphasize growing
companies that trade at reasonable valuations. Given the Fund's goal of
generating strong absolute returns, consistent with its objective of long-term
capital appreciation, we continued to employ a hedging strategy to minimize
risk. This approach proved extremely advantageous. In the spring, we became
extremely concerned over the large number of new technology companies that were
coming public without any earnings prospects, and we therefore increased our
position in put options on the Russell 2000--a move that proved very profitable
in the otherwise dark days of March and April. Throughout the year, we
maintained our discipline of setting price targets for our holdings and trading
actively around positions. While this strategy led to relatively high turnover,
it also contributed to performance, as it caused the Fund to take profits when
the market was strong and to come back to companies we knew well, when the
market was weak. Finally, a strong IPO market also contributed significantly to
performance, both through companies that had strong initial performance and by
providing a variety of new investment opportunities. The Fund's substantial
outperformance with respect to the Russell 2000 Index was due in part to
successful investments in IPOs throughout the course of the fiscal year
(although we cannot predict whether successful opportunities in IPOs will
continue to be available in future periods).
Over the course of the fiscal year, we generated strong returns in a number
of areas. In technology, the best performer was test and measurement company,
KEITHLEY INSTRUMENTS, which experienced dramatic earnings growth and multiple
expansion. We also profited from investments in software companies, such as
CAMINUS and EXE TECHNOLOGIES. The Fund's investments in semiconductor-related
issues yielded mixed results, with profits in some names more than offset by
losses in others.
The consumer and healthcare sectors also contributed to the success of the
Fund. In the consumer sector, CHRISTOPHER AND BANKS was the biggest contributor
to performance, with earnings per share rising by more than 100% over the past
year. In addition, other specialty retailers, such as FREDS and CSK AUTO,
contributed significantly to performance, as did CAREER EDUCATION and CORINTHIAN
COLLEGES, two very profitable operators of post-secondary schools. SHUFFLE
MASTER, a manufacturer of gaming equipment, also helped the Fund's performance.
In healthcare, our focus on profitable companies meant that we were
underweighted in the biotechnology sector, focusing instead on niche companies,
such as NORTH AMERICAN SCIENTIFIC, a maker of radioactive seeds used to treat
prostate cancer, and SUNRISE MEDICAL, a manufacturer of medical equipment. All
of these companies were trading at attractive valuations when the Fund bought
them, and all experienced multiple expansion and earnings growth.
While we had many successes over the past year, some of our investments
detracted from performance. Earnings disappointments at SHOE CARNIVAL and
TUESDAY MORNING (retailers), HANGER ORTHOPEDIC GROUP (healthcare services
provider) and QUIKLOGIC (technology) caused those stocks to sell off sharply.
--------------------------------------------------------------------------------
22
<PAGE>
--------------------------------------------------------------------------------
SCHRODER MICRO CAP FUND
--------------------------------------------------------------------------------
OUTLOOK
Looking forward, we continue to search for companies that can expand their
earnings independently of the economic cycle. We believe that many smaller
companies offer more attractive investment opportunities than do large companies
based on valuations and growth rates. Although the near-term interest rate and
economic outlook is murky, the market is showing signs of being driven more by
fundamentals--a positive sign for our style of investing. We will remain focused
on individual stock selection, concentrating on underfollowed and misunderstood
companies that can offer superior earnings growth.
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 DOES 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 OCTOBER 31, 2000
--------------------------------------------------------------------------------
23
<PAGE>
--------------------------------------------------------------------------------
SCHRODER MICRO CAP FUND
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
SCHRODER MICRO CAP FUND VS. RUSSELL 2000 INDEX
<TABLE>
<CAPTION>
MICRO CAP FUND RUSSELL 2000 INDEX
<S> <C> <C>
10/97 $10,000 $10,000
$10,260 $9,561
$10,370 $9,499
$10,778 $9,665
$10,748 $9,512
$12,124 $10,215
$13,593 $10,636
04/98 $14,633 $10,695
$14,541 $10,118
$14,684 $10,140
$14,765 $9,319
$13,583 $7,509
$14,266 $8,097
10/98 $15,275 $8,428
$16,352 $8,869
$17,573 $9,418
$18,344 $9,544
$19,815 $8,771
$19,554 $8,907
04/99 $21,736 $9,706
$23,929 $9,847
$24,831 $10,292
$25,910 $10,010
$25,506 $9,640
$27,878 $9,642
10/99 $29,158 $9,681
$30,580 $9,987
$34,253 $11,118
$35,716 $10,939
$46,638 $12,745
$48,518 $11,905
04/00 $53,161 $11,188
$52,485 $10,536
$61,736 $11,455
$62,507 $11,086
$71,469 $11,932
$71,854 $11,581
10/00 $74,183 $11,066
</TABLE>
The Russell 2000 Index is a market capitalization weighted broad based index of
2000 small capitalization U.S. companies.
PERFORMANCE INFORMATION
<TABLE>
<CAPTION>
INCEPTION TO
ONE YEAR ENDED OCTOBER 31,
OCTOBER 31, 2000 2000*
---------------- ------------
<S> <C> <C>
Schroder Micro Cap Fund--Investor Shares.................... 154.40% 93.05%
</TABLE>
<TABLE>
<C> <S>
* Average annual total return from commencement of operations
(October 15, 1997)
</TABLE>
"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
BOTH WILL FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN
INVESTOR'S ORIGINAL COST.
--------------------------------------------------------------------------------
24
<PAGE>
--------------------------------------------------------------------------------
SCHRODER MICRO CAP FUND
--------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF OCTOBER 31, 2000
TOP TEN HOLDINGS
<TABLE>
<CAPTION>
SECURITY % OF NET ASSETS
<S> <C>
------------------------------------------------
Watson Wyatt Class A 3.7%
Corinthian Colleges 3.5
Woodward Governor 3.0
Universal Compression
Holdings 3.0
Knightsbridge Tankers 2.9
DIANON Systems 2.9
Respironics 2.8
FirstFed Financial 2.5
Haven Bancorp 2.5
Serologicals 2.3
-----
Total 29.1%
=====
</TABLE>
INVESTMENTS BY SECTOR
<TABLE>
<CAPTION>
SECTOR % OF NET ASSETS
<S> <C>
------------------------------------------------
Banks & Finance 11.5%
Basic Industries 0.8
Business Services 5.4
Capital Goods 4.7
Consumer Cyclicals 8.1
Consumer Staples 1.0
Energy 6.2
Health Care 16.9
Technology 8.0
Technology -- Cellular/
Telecommunications 1.0
Technology -- Semiconductors 5.1
Technology -- Software 2.4
Transportation 3.3
Other 2.7
Cash Equivalents and Other
Net Assets 22.9
------
Total 100.0%
======
</TABLE>
--------------------------------------------------------------------------------
25
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
---------- ------------
<C> <S> <C>
COMMON STOCKS - 81.4%
AUSTRALIA - 0.8%
6,000 AMP $ 54,065
10,725 Brambles Industries 277,970
33,200 Broken Hill Proprietary 321,696
18,000 Lend Lease 210,649
8,300 OneSteel (1) 3,957
------------
868,337
------------
CANADA - 2.2%
35,979 BCE 965,888
21,123 Canadian Pacific 612,016
17,060 Nortel Networks 771,882
------------
2,349,786
------------
FINLAND - 2.0%
45,277 Sonera Oyj 996,313
107,833 Stora Enso Oyj 1,105,989
------------
2,102,302
------------
FRANCE - 5.5%
20,990 Alcatel (1) 1,279,249
3,860 Canal Plus 557,860
6,039 Cap Gemini 962,358
30,192 Sanofi-Synthelabo 1,586,709
9,743 Total Fina 1,392,400
------------
5,778,576
------------
GERMANY - 12.7%
3,120 Allianz 1,056,670
33,404 BASF 1,308,140
18,000 Bayerische Hypo - und Vereinsbank 987,930
29,774 Deutsche Bank 2,434,939
14,330 Deutsche Telekom 525,445
58,986 E.On 2,993,949
12,070 Metro 485,976
7,224 Munchener Ruckversicherungs 2,268,713
10,362 Siemens 1,317,933
------------
13,379,695
------------
ITALY - 4.0%
32,130 Assicurazioni Generali 1,055,349
453,940 Banca Intesa 1,881,573
136,423 ENI 737,772
346,920 Parmalat Finanziaria 499,910
------------
4,174,604
------------
JAPAN - 13.1%
54 DDI 253,219
361 East Japan Railway 2,073,035
34,000 Fuji Photo Film 1,261,147
28,000 Fujitsu 498,524
10,000 Honda Motor 345,281
102 Japan Tobacco 700,637
189,000 Mitsubishi Heavy Industries 733,938
<CAPTION>
SHARES VALUE
---------- ------------
<C> <S> <C>
JAPAN (CONTINUED)
164,000 Mitsui & Company $ 1,088,965
45,000 Mitsui Fudosan 544,849
46,400 Nippon Express 278,350
151,000 Nissan Motor (1) 1,035,835
21,000 Sekisui House 221,951
15,500 Sony 1,237,884
7,200 TDK 725,366
16,700 Tokyo Electric Power 405,317
34,000 Yamanouchi Pharmaceutical 1,538,289
166,000 Yasuda Fire & Marine Insurance 855,950
------------
13,798,537
------------
KOREA - 0.4%
3,700 Samsung Electronics 463,532
------------
NETHERLANDS - 9.3%
12,007 ASM Lithography Holding (1) 327,823
33,480 Fortis 1,021,649
29,500 Heineken 1,600,353
41,534 ING Groep 2,848,875
17,700 Koninklijke Ahold 513,563
33,686 Royal Dutch Petroleum 1,995,621
67,895 TNT Post Group 1,436,468
------------
9,744,352
------------
SOUTH AFRICA - 0.3%
46,100 Sappi 315,933
------------
SPAIN - 4.4%
31,000 Altadis 463,789
129,331 Amadeus Global Travel Distribution
Series A (1) 1,055,705
134,960 Endesa 2,196,443
49,078 Telefonica (1) 934,768
------------
4,650,705
------------
SWEDEN - 2.1%
169,476 Telefonaktiebolaget LM Ericsson
"B" Shares (1) 2,249,600
------------
SWITZERLAND - 8.0%
2,588 Novartis 3,924,993
127 Roche Holding 1,159,755
19,971 UBS 2,765,596
1,100 Zurich Financial Services (1) 532,233
------------
8,382,577
------------
TAIWAN - 0.0%
2,950 Acer GDR 12,242
------------
UNITED KINGDOM - 16.6%
57,140 Airtours 161,797
147,030 Bank of Scotland 1,372,819
32,490 Barclays 930,364
58,000 British Land 346,994
130,800 Cadbury Schweppes 809,122
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
26
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
---------- ------------
<C> <S> <C>
UNITED KINGDOM (CONTINUED)
122,750 Diageo $ 1,159,485
76,426 Electrocomponents 763,530
105,830 Glaxo Wellcome 3,048,926
62,720 Hays 342,672
351,873 Kingfisher 2,105,133
521,430 Legal & General Group 1,298,544
47,000 Lloyds TSB Group 479,106
50,550 Nycomed Amersham 452,900
30,000 Scottish & Southern Energy 249,616
210,650 Telewest Communications (1) 348,709
86,000 Tesco 328,124
798,724 Vodafone Group 3,325,803
------------
17,523,644
------------
Total Common Stocks
(Cost $87,539,858) 85,794,422
------------
SHORT-TERM INVESTMENTS - 9.2%
4,818,949 SSgA Money Market Fund 6.280% (2) 4,818,949
4,818,949 SSgA U.S. Government Money Market Fund
6.240% (2) 4,818,949
------------
Total Short-Term Investments
(Cost $9,637,898) 9,637,898
------------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
---------- ------------
<C> <S> <C>
REPURCHASE AGREEMENT - 8.1%
$8,523,000 State Street Bank and Trust Company,
5.250%, 11/01/00, repurchase
agreement, dated 10/31/00 with a
repurchase price of $8,524,243,
collateralized by a $8,930,000 United
States Treasury Note, 4.250%, due
11/15/03, valued at $8,698,258.
(Cost $8,523,000) $ 8,523,000
------------
</TABLE>
<TABLE>
<S> <C>
Total Investments
(Cost $105,700,756) - 98.7% 103,955,320
Other Assets Less Liabilities - 1.3% 1,407,398
------------
Total Net Assets - 100% $105,362,718
============
</TABLE>
------------------
(1) Denotes non-income producing security.
(2) Interest rate shown is 7-day yield as of October 31, 2000.
GDR - Global Depository Receipts
FORWARD FOREIGN CURRENCY CONTRACTS
CONTRACTS TO SELL
<TABLE>
<CAPTION>
UNREALIZED
UNDERLYING APPRECIATION
CONTRACT DATE CURRENCY UNITS FACE AMOUNT (DEPRECIATION)*
------------- -------- ----- ----------- ---------------
<S> <C> <C> <C> <C>
11/02/00 Great Britain Pound 313,437 $ 445,726 $ (9,416)
11/13/00 Great Britain Pound 1,309,000 1,947,393 46,147
11/13/00 Great Britain Pound 775,000 1,096,376 (29,266)
11/13/00 Great Britain Pound 1,168,000 1,724,019 27,567
11/13/00 Great Britain Pound 699,000 1,013,260 (1,997)
11/20/00 Japanese Yen 120,837,000 1,123,020 12,222
12/07/00 Japanese Yen 327,331,000 3,100,841 82,588
12/14/00 Japanese Yen 781,292,000 7,478,625 265,691
---------
$ 393,536
=========
</TABLE>
CONTRACTS TO BUY
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
11/13/00 Euro 2,153,315 1,947,393 (121,029)
11/13/00 Euro 1,293,715 1,096,376 906
11/13/00 Euro 1,953,733 1,724,019 (66,933)
11/13/00 Euro 1,210,358 1,013,260 13,322
----------- ----------
$23,710,308 $ (173,734)
=========== ==========
</TABLE>
* Does not include foreign currency spot contracts sold with unrealized
depreciation of $4,268 or
foreign currency spot contracts purchased with unrealized appreciation of
$1,271.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
27
<PAGE>
--------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
COMMON STOCKS - 86.0%
ARGENTINA - 0.4%
15,700 Quilmes Industrial (Quinsa) ADR $ 129,525
-----------
BRAZIL - 9.5%
9,500 Aracruz Celulose ADR 142,500
7,200 Brasil Telecom Participacoes ADR 390,150
10,600 Companhia Brasileira de Distribuicao
Grupo Pao de Acucar ADR 377,625
11,800 Companhia de Bebidas (Ambev) ADR 266,238
8,900 Companhia Vale do Rio Doce 205,197
22,500 Embratel Participacoes ADR 364,219
23,500 Petroleo Brasileiro ADR 646,858
4,100 Tele Celular Sul Participacoes ADR 103,269
10,553 Tele Norte Leste Participacoes ADR 233,485
8,700 Telesp Celular Participacoes ADR 275,137
-----------
3,004,678
-----------
CHILE - 1.1%
10,400 CIA de Telecomunicaciones de Chile ADR 158,600
10,900 Distribucion y Servicio D&S ADR 194,838
-----------
353,438
-----------
CHINA - 1.6%
1,526,000 Beijing North Star 135,012
1,044,000 China Petroleum & Chemical
(Sinopec) (1) 204,815
480,000 Nanjing Panda Electronics (1) 96,630
296,000 PetroChina 62,245
-----------
498,702
-----------
CZECH REPUBLIC - 0.4%
8,970 Cesky Telecom GDR (1) 118,404
2 Komercni Banka GDR (1) 14
-----------
118,418
-----------
EGYPT - 0.6%
4,950 Egyptian Company for Mobile Services
(MobilNil) (1) 97,930
7,450 Orascom Telecommunications (1) 92,890
-----------
190,820
-----------
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
GREECE - 2.1%
2,850 Alpha Bank $ 105,185
10,000 Cosmote (1) 74,862
13,936 Hellenic Telecommunications Organization 243,084
2,600 National Bank of Greece 98,684
8,750 STET Hellas Telecommunications ADR (1) 126,875
-----------
648,690
-----------
HONG KONG - 10.5%
2,066,000 Brilliance China Automotive Holdings 668,900
158,000 China Mobile (Hong Kong) (1) 1,012,971
70,000 China Resources Enterprise 79,435
524,000 China Unicom (1) 1,051,515
390,000 Cosco Pacific 287,543
266,000 Legend Holdings 225,110
-----------
3,325,474
-----------
HUNGARY - 1.4%
14,570 Matav Rt. ADR 342,395
2,250 OTP Bank Rt. GDR 103,388
-----------
445,783
-----------
INDONESIA - 1.3%
337,000 PT Hanjaya Mandala Sampoerna 396,061
-----------
ISRAEL - 4.4%
4,120 Check Point Software Technologies (1) 652,505
5,410 ECI Telecom 127,811
1,600 Gilat Satellite Networks (1) 81,900
2,540 Nice Systems (1) 118,745
2,100 Orbotech (1) 111,169
5,800 Orckit Communications 28,638
4,260 Teva Pharmaceutical Industries 251,872
5,800 Tioga Technologies (1) 23,925
-----------
1,396,565
-----------
KOREA - 13.4%
19,460 Kookmin Bank 222,408
55,600 Korea Electric Power (KEPCO) ADR 1,130,000
14,700 Korea Telecom ADR 824,022
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
28
<PAGE>
--------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
KOREA (CONTINUED)
9,400 Samsung Electronics $ 1,177,623
2,340 Samsung Securities 42,378
24,770 Shinhan Bank 248,253
2,800 SK Telecom. Krw500 596,943
-----------
4,241,627
-----------
MALAYSIA - 1.7%
25,000 British American Tobacco (Malaysia) 228,626
150,000 IOI 106,582
47,000 Malayan Banking 188,006
-----------
523,214
-----------
MEXICO - 10.4%
57,711 Cemex 242,417
52,100 Fomento Economico Mexico 198,161
168,000 Grupo Financiero Banamex Accival (1) 260,859
80,000 Grupo Financiero BBVA Bancomer (1) 49,461
70,000 Grupo Modelo 186,516
6,000 Grupo Televisa GDS (1) 324,750
45,000 Kimberly - Clark de Mexico 114,966
26,100 Telefonos de Mexico ADR 1,407,769
10,300 Tubos de Acero de Mexico (TAMSA) ADR 156,663
147,000 Wal-Mart de Mexico (1) 334,852
-----------
3,276,414
-----------
PERU - 0.2%
7,500 Credicorp 54,844
-----------
PHILIPPINES - 0.5%
11,000 Philippine Long Distance Telephone 166,672
-----------
POLAND - 1.4%
15,900 Elektrim Towarz 125,930
10,800 KGHM Polska Miedz GDR 116,640
37,760 Telekomunikacja Polska GDR 189,744
-----------
432,314
-----------
RUSSIA - 3.9%
9,375 LUKoil ADR 500,625
4,487 Mobile Telesystems ADR (1) 123,953
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
RUSSIA (CONTINUED)
15,520 RAO Unified Energy Systems GDR $ 196,328
33,020 Surgutneftegaz 424,307
-----------
1,245,213
-----------
SOUTH AFRICA - 5.4%
292,700 African Bank Investments (1) 231,960
26,500 Dimension Data Holdings (1) 228,240
10,100 Johnnic Holdings 114,917
25,900 Naspers 192,575
530,300 Profurn 259,590
42,100 Sappi 288,520
51,500 Sasol 394,503
-----------
1,710,305
-----------
TAIWAN - 9.0%
79,000 Advanced Semiconductor Engineering 90,572
59,000 Ambit Microsystems 273,487
90,000 Compal Electronics 137,114
81,600 Compeq Manufacturing 307,640
100,000 Delta Electronics 318,295
311,000 Far Eastern Textile 255,644
155,000 Siliconware Precision Industries 117,831
120,000 Taiwan Cellular (1) 250,310
253,680 Taiwan Semiconductor Manufacturing 768,255
70,400 United Microelectronics 124,005
8,000 Via Technologies 57,355
159,000 Wus Printed Circuit 140,034
-----------
2,840,542
-----------
THAILAND - 1.5%
28,300 Advanced Info Service (1) 232,919
48,000 PTT Exploration & Production (1) 117,863
242,368 TelecomAsia (1) 121,102
-----------
471,884
-----------
TURKEY - 4.8%
3,109,119 Anadolu Efes Biracilik ve Malt
Sanayii (1) 182,136
3,020,000 Koc Holding 192,396
540,000 Migros Turk T.A.S. 74,340
2,121,300 Turkcell Iletisim Hizmetleri (1) 93,201
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
29
<PAGE>
--------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
TURKEY (CONTINUED)
9,400,000 Turkiye Garanti Bankasi $ 96,366
17,904,000 Turkiye Is Bankasi (Isbank) 340,873
145,300 Vestel Electronik Sanayi ve Ticaret 29,792
58,211,000 Yapi ve Kredi Bankasi 502,986
-----------
1,512,090
-----------
ZIMBABWE - 0.5%
619,000 Econet Wireless Holdings (1)(2) 147,013
-----------
Total Common Stocks
(Cost $31,386,148) 27,130,286
-----------
PREFERRED STOCK - 1.8%
BRAZIL - 1.8%
32,908,525 Banco Bradesco 203,479
1,485,000 Banco Itau 115,553
2,150,000 Companhia de Tecidos Norte de Minas -
Coteminas (2) 158,849
1,460,000 Eletropaulo Metropolitana - Electricidad
de Sao Paulo 81,859
-----------
559,740
-----------
Total Preferred Stock
(Cost $549,728) 559,740
-----------
WARRANTS - 3.1%
INDIA - 3.1%
40,500 Hindustan Lever (1) 154,129
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
INDIA (CONTINUED)
3,650 Infosys Technologies (1) $ 559,744
42,000 Satyam Computer Services (1) 276,124
-----------
Total Warrants
(Cost $1,248,949) 989,997
-----------
SHORT-TERM INVESTMENTS - 6.0%
178,422 SSgA Money Market Fund 6.280% (3) 178,422
1,714,552 SSgA U.S. Government Money Market Fund
6.240% (3) 1,714,552
-----------
Total Short-Term Investments
(Cost $1,892,974) 1,892,974
-----------
</TABLE>
<TABLE>
<S> <C>
Total Investments
(Cost $35,077,799) - 96.9% 30,572,997
Other Assets Less Liabilities - 3.1% 980,249
-----------
Total Net Assets - 100% $31,553,246
===========
</TABLE>
------------------
(1) Denotes non-income producing security.
(2) Deemed illiquid security.
(3) Interest rate shown is 7-day yield as of October 31, 2000.
ADR - American Depository Receipts
GDR - Global Depository Receipts
GDS - Global Depository Shares
FORWARD FOREIGN CURRENCY CONTRACTS
CONTRACTS TO SELL
<TABLE>
<CAPTION>
UNDERLYING UNREALIZED
CONTRACT DATE CURRENCY UNITS FACE AMOUNT APPRECIATION*
------------- -------- ----- ----------- -------------
<S> <C> <C> <C> <C>
3/07/01 Mexican Peso 3,241,000 $334,303 $11,079
======== =======
</TABLE>
* Does not include foreign currency spot contracts with unrealized depreciation
of $4.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
30
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
----------- -----------
<C> <S> <C>
COMMON STOCKS - 87.3%
AUSTRIA - 0.7%
4,640 Austria Technologie & Systemtechnik $ 129,398
-----------
FINLAND - 1.1%
14,700 Comptel Oyj 203,104
-----------
FRANCE - 9.9%
916 A Novo 134,402
650 ALTEN (1) 80,111
6,500 Camaieu (1) 95,042
2,800 Coflexip ADR 159,775
5,640 ESI Group (1) 205,571
5,850 Genesys (1) 272,729
8,400 GFI Informatique 213,037
1,700 HF (2) 128,249
5,300 Infogrames Entertainment (1) 110,740
2,300 R2I Sante (2) 38,992
5,700 Societe Pour L' Informatique 218,870
3,140 Sys-Com (2) 89,137
7,440 Valtech (1) 95,228
-----------
1,841,883
-----------
GERMANY - 8.2%
2,930 Babcock Borsig (1) 110,520
2,333 Das Werk (1) 56,756
4,030 Edel Music (1) 69,345
3,700 Energiekontor (1) 332,446
2,250 Primacom (1) 43,865
3,090 Rhoen Klinikum 168,285
4,155 Roesch Medizintechnik (2) 223,645
2,110 SGL Carbon (1) 128,792
1,540 Solarworld (1) 110,957
16,690 Takkt (2) 138,642
2,300 Telegate (1) 140,955
-----------
1,524,208
-----------
HONG KONG - 0.9%
7,600 Dah Sing Financial Group 32,646
38,000 Quality Healthcare Asia 8,771
480,000 Tan Chong International 65,856
168,000 TCL International Holdings (1) 27,573
26,000 Varitronix International 30,004
-----------
164,850
-----------
<CAPTION>
SHARES VALUE
----------- -----------
<C> <S> <C>
IRELAND - 2.0%
45,750 Fyffes $ 33,738
20,840 Parthus Technologies (1) 71,418
5,280 SmartForce ADR (1) 265,733
-----------
370,889
-----------
ITALY - 2.4%
11,500 Class Editori 161,816
35,500 De Rigo ADR (2) 290,656
-----------
452,472
-----------
JAPAN - 21.2%
1,000 Airport Facilities 3,444
10,000 ARC Land Sakamoto (2) 119,063
300 Bellsystem24 107,706
6,000 Charle (2) 31,597
20,000 Daibiru 152,950
15,000 Diamond City (2) 43,962
19,000 Eiden 116,590
23,300 Exedy (2) 166,449
4,000 Fujitsu Devices 66,309
1,000 Fujitsu Support & Service (FSAS) 121,444
9,500 Idec Izumi 91,793
6,000 Inaba Denkisangyo 67,976
20,000 Japan Airport Terminal 149,286
1,100 Kadokawa Shoten Publishing (1) 36,268
3,000 Komeri 59,485
1,900 Kosaido 17,140
4,000 Kose 138,845
11,000 Mandom 110,820
5,700 Meiko Shokai (2) 83,005
7 Mobilephone Telecommunications
International 21,349
6,000 Nippon Thompson 59,073
5,300 Nissan 159,214
18,000 Nissan Fire & Marine Insurance 52,094
1,200 Otsuka Kagu 97,814
29,000 Rengo 136,785
14,000 Sanken Electric 81,036
19,000 Sanyo Chemical Industries 143,214
4 Shoeisha 49,090
4 Sky Perfect Communications (1) 7,364
1 Sotec (1) 13,921
2,300 Sumida 105,535
16,000 Sumitomo Bakelite 178,924
35,000 Sumitomo Warehouse 85,588
4,000 Tachihi Enterprise (2) 76,200
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
31
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
----------- -----------
<C> <S> <C>
JAPAN (CONTINUED)
4,000 Tanaka Chemical $ 83,893
4,000 TKC 75,101
12,000 Toho Real Estate (2) 39,675
2,000 Tohoku Pioneer 71,437
3,000 Tokyo Individualized Educational
Institute (2) 60,447
6,500 Tokyo Ohka Kogyo 109,240
5,800 Torii Pharmaceutical 139,441
5,000 Touei Housing 77,053
3,500 Trusco Nakayama 46,416
12,500 Tsubaki Nakashima 156,499
1,200 Union Tool 82,428
12,000 Yushiro Chemical Industry (2) 60,447
-----------
3,953,410
-----------
LUXEMBOURG - 0.4%
2,600 SBS Broadcasting (1) 77,675
-----------
NETHERLANDS - 5.5%
4,000 Apothekers Cooperatie OPG 96,801
5,000 BE Semiconductor Industries 46,620
7,500 CSM 171,012
2,804 Devote 60,252
10,000 Fox Kids Europe (1) 114,432
4,145 Nutreco Holding 178,485
4,542 Ordina Beheer 122,045
4,000 Qiagen (1) 171,224
3,400 Seagull Holding (1) 55,911
-----------
1,016,782
-----------
SINGAPORE - 3.8%
163,500 Lindeteves-Jacoberg 84,290
185,000 Nera Telecommunications (1) 84,835
63,000 Sembcorp Industries 60,651
122,000 SIA Engineering (1) 100,771
80,000 Singapore Airport Terminal Services (1) 86,587
52,000 Singapore Computer Systems 76,721
7,000 Venture Manufacturing (Singapore) 67,789
60,000 WBL (2) 63,573
98,000 Wing Tai Holdings 75,923
-----------
701,140
-----------
SPAIN - 2.4%
15,384 NH Hoteles (1) 173,434
10,000 Prosegur Compania Seguridad 98,327
<CAPTION>
SHARES VALUE
----------- -----------
<C> <S> <C>
SPAIN (CONTINUED)
2,900 Sogecable (1) $ 70,795
27,300 TelePizza (1) 104,365
-----------
446,921
-----------
SWEDEN - 5.0%
5,700 Biacore International 241,205
3,300 Maxim Pharmaceuticals (1) 144,915
5,720 Micronic Laser Systems (1) 170,121
4,920 OM Gruppen 175,299
8,800 Scandic Hotels 89,583
11,350 Utfors (1) 105,914
-----------
927,037
-----------
SWITZERLAND - 1.3%
20 Lindt & Spruengli 105,112
247 Sez Holding 143,550
-----------
248,662
-----------
UNITED KINGDOM - 22.5%
50,000 Amstrad 122,920
60,000 Arriva 202,132
100,500 British Regional Airlines Group (2) 82,454
160,000 Carillion 246,276
105,000 Clinton Cards (2) 134,174
100,000 Communisis 236,692
36,516 Fairey Group 273,078
21,500 Galen Holdings 282,542
40,000 Homestyle Group 178,318
25,128 Iceland Group 119,499
16,118 Interx 220,007
40,000 Johnston Press 184,126
85,000 London Clubs International 149,348
197,500 Low & Bonar 288,224
28,000 Penna Holdings (2) 221,997
68,500 Photo-Me International 137,267
15,000 PSD Group 230,339
25,000 Renishaw 257,748
24,500 Scipher (1) 224,132
9,000 Scottish Radio Holdings 161,401
115,000 Sterling Publishing Group 250,487
-----------
4,203,161
-----------
Total Common Stocks
(Cost $16,266,493) 16,261,592
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
32
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
----------- -----------
<C> <S> <C>
PREFERRED STOCK - 3.0%
GERMANY - 3.0%
855 Hugo Boss $ 217,711
2,560 MLP 346,110
-----------
Total Preferred Stock
(Cost $235,562) 563,821
-----------
SHORT-TERM INVESTMENTS - 7.9%
654,929 SSgA Money Market Fund 6.280% (3) 654,929
820,394 SSgA U.S. Government Money Market Fund
6.240% (3) $ 820,394
-----------
Total Short-Term Investments
(Cost $1,475,323) 1,475,323
-----------
</TABLE>
<TABLE>
<S> <C>
Total Investments
(Cost $17,977,378) - 98.2% 18,300,736
Other Assets Less Liabilities - 1.8% 333,342
-----------
Total Net Assets - 100% $18,634,078
===========
</TABLE>
------------------
(1) Denotes non-income producing security.
(2) Deemed illiquid security.
(3) Interest rate shown is 7-day yield as of October 31, 2000.
ADR - American Depository Receipts
FORWARD FOREIGN CURRENCY CONTRACTS
CONTRACTS TO SELL
<TABLE>
<CAPTION>
UNDERLYING UNREALIZED
CONTRACT DATE CURRENCY UNITS FACE AMOUNT APPRECIATION*
------------- -------- ----- ----------- -------------
<S> <C> <C> <C> <C>
11/20/00 Japanese Yen 101,006,220 $ 938,720 $ 10,217
12/07/00 Japanese Yen 73,055,000 692,451 18,826
12/14/00 Japanese Yen 89,433,000 856,064 30,413
----------- --------
$ 2,487,235 $ 59,456
=========== ========
</TABLE>
* Does not include foreign currency spot contracts with unrealized appreciation
of $88.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
33
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. LARGE CAP EQUITY FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
-------- -----------
<C> <S> <C>
COMMON STOCKS - 99.2%
BASIC MATERIALS - 1.9%
24,500 International Paper $ 897,313
-----------
CAPITAL GOODS - 9.7%
22,200 Emerson Electric 1,630,312
36,000 General Electric 1,973,250
31,300 Raytheon Class B 1,070,069
-----------
4,673,631
-----------
COMPUTER HARDWARE - 15.7%
32,400 Cisco Systems (1) 1,745,550
25,600 Dell Computer (1) 755,200
15,600 EMC (1) 1,389,375
13,900 Gateway (1) 717,379
25,600 Intel 1,152,000
10,600 Sun Microsystems (1) 1,175,275
12,900 Texas Instruments 632,906
-----------
7,567,685
-----------
COMPUTER SERVICES - 2.2%
22,600 Electronic Data Systems 1,060,788
-----------
COMPUTER SOFTWARE - 5.6%
24,300 Microsoft (1) 1,673,662
31,500 Oracle (1) 1,039,500
-----------
2,713,162
-----------
CONSUMER CYCLICALS - 5.3%
21,900 Costco Wholesale (1) 802,088
22,400 Interpublic Group of Companies 961,800
18,000 Lowe's Companies 822,375
-----------
2,586,263
-----------
CONSUMER STAPLES - 10.1%
32,000 Anheuser Busch 1,464,000
29,500 McDonald's 914,500
8,600 PepsiCo 416,562
21,800 Time Warner 1,654,838
12,400 Walt Disney 444,075
-----------
4,893,975
-----------
ENERGY - 6.6%
10,700 Chevron 878,738
47,700 Conoco 1,231,256
12,400 Exxon Mobil 1,105,925
-----------
3,215,919
-----------
<CAPTION>
SHARES VALUE
-------- -----------
<C> <S> <C>
FINANCIAL SERVICES - 20.1%
17,860 American International Group $ 1,750,280
18,100 Bank of America 869,931
16,100 Capital One Financial 1,016,313
32,932 Citigroup 1,733,046
22,700 Federal National Mortgage Association 1,747,900
38,100 FleetBoston Financial 1,447,800
16,100 Merrill Lynch 1,127,000
-----------
9,692,270
-----------
HEALTH CARE - 13.2%
4,400 Baxter International 361,625
22,200 Bristol-Myers Squibb 1,352,812
17,600 Medtronic 955,900
36,775 Pfizer 1,588,220
16,300 Pharmacia 896,500
23,400 Schering-Plough 1,209,488
-----------
6,364,545
-----------
TELECOMMUNICATIONS - 6.0%
24,500 AT&T Wireless Group (1) 610,969
7,100 Nortel Networks 323,050
11,332 Qwest Communications International (1) 551,018
14,800 Tellabs (1) 739,075
28,100 WorldCom (1) 667,375
-----------
2,891,487
-----------
UTILITIES - 2.8%
22,700 Exelon (1) 1,364,838
-----------
Total Common Stocks
(Cost $43,490,631) 47,921,876
-----------
SHORT-TERM INVESTMENTS - 0.5%
257,974 SSgA U.S. Government Money Market Fund
6.260% (2)
(Cost $257,974) 257,974
-----------
</TABLE>
<TABLE>
<S> <C>
Total Investments
(Cost $43,748,605) - 99.7% 48,179,850
Other Assets Less Liabilities - 0.3% 147,245
-----------
Total Net Assets - 100% $48,327,095
===========
</TABLE>
------------------
(1) Denotes non-income producing security.
(2) Interest rate shown is 7-day yield as of October 31, 2000.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
34
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
COMMON STOCKS - 88.3%
BASIC MATERIALS - 1.1%
9,056 Cambrex $ 361,674
10,300 Cytec Industries (1) 356,637
-----------
718,311
-----------
BUSINESS SERVICES - 1.9%
21,100 National Data 804,437
30,400 Ogden 418,000
-----------
1,222,437
-----------
CAPITAL GOODS - 5.1%
10,500 Alliant Techsystems (1) 944,344
11,400 APW (1) 526,537
12,900 Hillenbrand Industries 596,625
9,300 Mettler-Toledo International (1) 434,194
5,985 SPX (1) 739,896
-----------
3,241,596
-----------
CONSUMER CYCLICALS - 9.8%
35,100 Abercrombie & Fitch Class A (1) 827,044
20,739 CEC Entertainment (1) 661,056
38,300 Furniture Brands International (1) 646,313
32,343 Jack in The Box (1) 792,403
26,792 Rent-A-Center (1) 781,991
39,610 Ruby Tuesday 537,211
68,500 Tommy Hilfiger (1) 796,312
51,500 Venator Group (1) 727,437
13,900 Zale (1) 470,863
-----------
6,240,630
-----------
ENERGY - 7.1%
8,000 Atwood Oceanics (1) 268,500
8,280 BJ Services (1) 434,183
11,000 Cal Dive International (1) 547,250
4,286 Cooper Cameron (1) 233,587
76,800 Grey Wolf (1) 355,200
24,138 Hanover Compressor (1) 787,502
127,900 Methanex (1) 511,600
28,600 Pride International (1) 723,937
34,200 UTI Energy (1) 686,138
-----------
4,547,897
-----------
FINANCE - 11.2%
18,320 Affiliated Managers Group (1) 1,101,490
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
FINANCE (CONTINUED)
37,600 Allied Capital $ 775,500
23,000 AmeriCredit (1) 618,125
20,700 AmerUs Group 545,962
12,337 Bank United 699,354
15,900 Federated Investors 463,088
25,818 Heller Financial 755,176
11,600 Hilb, Rogal & Hamilton 459,650
16,600 IndyMac Bancorp 346,525
9,300 Silicon Valley Bancshares (1) 430,125
39,500 Sovereign Bancorp 328,344
2,300 White Mountains Insurance Group 604,900
-----------
7,128,239
-----------
HEALTH CARE - 21.2%
3,300 Accredo Health (1) 142,725
14,100 AmeriSource Health Class A (1) 612,469
35,575 Apria Healthcare Group (1) 711,500
7,100 Beckman Coulter 497,444
44,100 Bergen Brunswig Class A 399,656
111,300 Beverly Enterprises (1) 556,500
15,700 C. R. Bard 657,438
22,200 Charles River Laboratories
International (1) 582,750
13,657 Community Health Care (1) 384,957
53,800 DaVita (1) 605,250
18,700 Dendrite International (1) 406,725
15,200 Dura Pharmaceuticals (1) 523,450
50,100 Edwards Lifesciences(1) 673,219
11,100 First Health Group(1) 432,900
8,600 Henry Schein 209,625
25,791 Invacare 735,044
5,400 Laboratory Corporation of America
Holdings 728,325
12,300 Medicis Pharmaceutical Class A (1) 905,587
33,200 Mentor 585,150
4,793 Quest Diagnostics (1) 461,326
37,500 Renal Care Group (1) 881,250
12,939 Sybron International (1) 320,240
9,100 Universal Health Services (1) 763,262
14,800 Varian Medical Systems (1) 723,350
-----------
13,500,142
-----------
MEDIA - 1.7%
20,400 Catalina Marketing (1) 800,700
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
35
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
MEDIA (CONTINUED)
200 Cox Radio Class A (1) $ 4,487
6,833 True North Communications 257,519
-----------
1,062,706
-----------
TECHNOLOGY - 17.3%
22,100 Affiliated Computer Services (1) 1,230,694
17,900 Amphenol (1) 1,150,075
19,800 Artesyn Technologies (1) 804,375
9,200 Avocent (1) 652,625
8,100 Black Box (1) 533,588
11,000 C&D Technologies 650,375
5,196 CTS 223,103
13,400 InFocus (1) 592,113
11,143 Perkinelmer 1,331,588
20,000 RadiSys (1) 530,000
40,300 Sensormatic Electronics (1) 725,400
43,400 SonicWALL (1) 648,287
1,400 Technitrol 155,225
10,500 Tektronix 748,125
13,300 Varian (1) 409,806
13,800 Zebra Technologies (1) 604,613
-----------
10,989,992
-----------
TECHNOLOGY-CELLULAR/
TELECOMMUNICATIONS - 0.7%
3,800 Inrange Technologies Class B (1) 139,175
32,100 ITC DeltaCom (1) 259,810
2,700 Ixia (1) 63,281
-----------
462,266
-----------
TECHNOLOGY-SEMICONDUCTORS - 5.3%
17,500 Advanced Energy Industries (1) 301,875
10,700 Alpha Industries (1) 426,663
10,700 Cymer (1) 267,500
7,200 DuPont Photomasks (1) 404,100
10,300 Fairchild Semiconductor (1) 216,944
11,300 IXYS (1) 286,031
12,800 Lattice Semiconductor (1) 373,600
13,400 Pericom Semiconductor (1) 355,100
12,900 Varian Semiconductor Equipment
Associates (1) 296,700
9,100 Zoran (1) 456,137
-----------
3,384,650
-----------
TECHNOLOGY-SOFTWARE - 3.1%
31,200 Progress Software (1) $ 493,350
<CAPTION>
SHARES VALUE
---------- -----------
<C> <S> <C>
TECHNOLOGY-SOFTWARE (CONTINUED)
39,500 Sybase (1) 827,031
16,800 Symantec (1) 656,250
-----------
1,976,631
-----------
TRANSPORTATION - 0.9%
14,900 Teekay Shipping 556,887
-----------
UTILITIES - 1.9%
35,707 El Paso Electric (1) 428,127
19,400 Kinder Morgan 748,112
-----------
1,176,239
-----------
Total Common Stocks
(Cost $45,408,763) 56,208,623
-----------
SHORT-TERM INVESTMENTS - 8.9%
2,837,297 SSgA U.S. Government Money Market Fund
6.240% (2) 2,837,297
2,837,297 SSgA Money Market Fund 6.280% (2) 2,837,297
-----------
Total Short-Term Investments
(Cost $5,674,594) 5,674,594
-----------
<CAPTION>
PRINCIPAL
AMOUNT
----------
<C> <S> <C>
REPURCHASE AGREEMENT - 1.2%
$ 756,000 State Street Bank and Trust Company,
5.250%, 11/01/00, repurchase
agreement, dated 10/31/00 with a
repurchase price of $756,110,
collateralized by a $795,000 United
States Treasury Note, 4.250%, due
11/15/03, valued at $774,369.
(Cost $756,000) 756,000
-----------
</TABLE>
<TABLE>
<S> <C>
Total Investments
(Cost $51,839,357) - 98.4% 62,639,217
Other Assets Less Liabilities - 1.6% 997,765
-----------
Total Net Assets - 100% $63,636,982
===========
</TABLE>
------------------
(1) Denotes non-income producing security.
(2) Interest rate shown is 7-day yield as of October 31, 2000.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
36
<PAGE>
--------------------------------------------------------------------------------
SCHRODER MICRO CAP FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
----------- -----------
<C> <S> <C>
COMMON STOCKS - 74.4%
BANKS & FINANCE - 11.5%
75,000 Berkshire Hill Bancorp $ 1,101,563
36,000 Brown & Brown 1,170,000
80,000 FirstFed Financial (1) 2,040,000
100,000 Glacier Bancorp 1,281,250
70,000 Haven Bancorp 2,003,750
11,500 Parkvale Financial 215,625
50,000 Quaker City Bancorp (1) 946,875
20,000 Queens County Bancorp 560,000
-----------
9,319,063
-----------
BASIC INDUSTRIES - 0.8%
65,000 Ladish (1) 658,125
-----------
BUSINESS SERVICES - 5.4%
50,000 Hall, Kinion & Associates (1) 1,321,875
175,000 Watson Wyatt Class A (1) 3,029,688
-----------
4,351,563
-----------
CAPITAL GOODS - 4.7%
20,000 Doncasters ADR (1) 360,000
30,000 Engineered Support Systems 555,000
15,000 Primex Technologies 439,687
55,000 Woodward Governor 2,462,969
-----------
3,817,656
-----------
CONSUMER CYCLICALS - 8.1%
40,500 Corinthian Colleges (1) 2,799,562
50,000 Cutter & Buck (1) 512,500
52,600 Fossil (1) 687,088
57,500 Gadzooks (1) 1,045,781
30,000 Genesco (1) 532,500
32,000 Penn National Gaming (1) 560,000
20,000 Shuffle Master (1) 448,750
-----------
6,586,181
-----------
CONSUMER STAPLES - 1.0%
25,000 Pathmark Stores (1) 395,625
55,000 Spartan Stores (1) 384,059
-----------
779,684
-----------
ENERGY - 6.2%
40,000 Chiles Offshore (1) 640,000
70,000 Horizon Offshore (1) 962,500
<CAPTION>
SHARES VALUE
----------- -----------
<C> <S> <C>
ENERGY (CONTINUED)
15,000 Key Energy Services (1) $ 135,000
33,000 OSCA Class A (1) 511,500
50,000 Patina Oil & Gas (1) 290,625
85,000 Universal Compression Holdings (1) 2,454,375
-----------
4,994,000
-----------
HEALTH CARE - 16.9%
70,000 AmSurg Class A (1) 1,023,750
30,000 CorVel (1) 950,625
62,500 DIANON Systems (1) 2,312,500
35,000 Exactech (1) 665,000
15,000 ICU Medical (1) 375,000
10,000 LifePoint Hospitals (1) 387,500
75,000 Orthofix International (1) 1,575,000
78,300 Regeneration Technologies (1) 993,431
116,600 Respironics (1) 2,288,275
275,000 Serologicals (1) 1,856,250
67,500 Sterile Recoveries (1) 995,625
10,000 Syncor International (1) 256,875
-----------
13,679,831
-----------
TECHNOLOGY - 8.0%
2,200 Bel Fuse Class A 93,912
140,000 Media 100 (1) 1,382,500
62,500 Richardson Electronics 855,469
30,300 ScanSource (1) 1,446,825
15,000 Signal Technology (1) 241,875
85,000 Spectrum Control Class A (1) 1,051,875
60,000 Trimble Navigation (1) 1,425,000
-----------
6,497,456
-----------
TECHNOLOGY-CELLULAR/
TELECOMMUNICATIONS - 1.0%
50,000 GenTek 834,375
-----------
TECHNOLOGY-SEMICONDUCTORS - 5.1%
20,000 Brooks Automation (1) 530,000
70,000 ESS Technology (1) 1,085,000
20,000 OmniVision Technologies (1) 682,500
65,000 Photronics (1) 1,466,562
70,000 Robotic Vision Systems (1) 382,813
-----------
4,146,875
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
37
<PAGE>
--------------------------------------------------------------------------------
SCHRODER MICRO CAP FUND
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2000
<TABLE>
<CAPTION>
SHARES VALUE
----------- -----------
<C> <S> <C>
TECHNOLOGY-SOFTWARE - 2.4%
85,000 Metasolv Software (1) $ 1,054,686
69,500 Take Two Interactive Software (1) 864,406
-----------
1,919,092
-----------
TRANSPORTATION - 3.3%
110,000 Knightsbridge Tankers 2,371,875
50,000 OMI (1) 346,875
-----------
2,718,750
-----------
Total Common Stocks
(Cost $53,258,856) 60,302,651
-----------
OPTIONS - 2.7%
50,000 Nasdaq 100 Index Call Oct 00/8.125 (1) 381,250
35,000 Russell 2000 Index Put Nov 00/530 (1) 1,141,875
40,000 Russell 2000 Index Put Dec 00/490 (1) 680,000
-----------
Total Options
(Cost $2,247,500) 2,203,125
-----------
SHORT-TERM INVESTMENTS - 9.1%
3,679,464 SSgA Money Market Fund 6.280% (2) 3,679,464
3,679,465 SSgA U.S. Government Money Market Fund
6.240% (2) 3,679,465
-----------
Total Short-Term Investments
(Cost $7,358,929) 7,358,929
-----------
<CAPTION>
PRINCIPAL
AMOUNT VALUE
----------- -----------
<C> <S> <C>
REPURCHASE AGREEMENT - 17.4%
$14,071,000 State Street Bank and Trust Company,
5.250%, 11/01/00, repurchase
agreement, dated 10/31/00 with a
repurchase price of $14,073,052,
collateralized by a $14,735,000 United
States Treasury Note, 4.250%, due
11/15/03, valued at $14,352,612.
(Cost $14,071,000) $14,071,000
-----------
</TABLE>
<TABLE>
<S> <C>
Total Investments
(Cost $76,936,285) - 103.6% 83,935,705
Liabilities in Excess of Other Assets -
(3.6%) (2,950,380)
-----------
Total Net Assets - 100% $80,985,325
===========
</TABLE>
------------------
(1) Denotes non-income producing security.
(2) Interest rate shown is 7-day yield as of October 31, 2000.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
38
<PAGE>
(This page has been left blank intentionally.)
--------------------------------------------------------------------------------
39
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
OCTOBER 31, 2000
<TABLE>
<CAPTION>
EMERGING
INTERNATIONAL MARKETS
FUND FUND
--------------- ------------
<S> <C> <C>
ASSETS
Investments in securities, at value--Note 2 $ 95,432,320 $30,572,997
Repurchase agreements 8,523,000 --
Cash 421 72,050
Foreign currency, at value 104,729 633,872
Dividends and tax reclaims receivable 197,457 23,302
Interest receivable 49,488 7,667
Receivable for securities sold 1,762,287 275,136
Receivable for foreign currency contracts sold 389,268 11,079
Receivable for Fund shares sold 2,835,086 148,483
Deferred organizational costs -- 389
Prepaid expenses 3,611 13,611
Due from Investment Advisor--Note 3 26,893 92,961
------------ -----------
Total Assets 109,324,560 31,851,547
------------ -----------
LIABILITIES
Payable for securities purchased 1,665,372 164,063
Payable for foreign currency contracts purchased 172,463 4
Payable for Fund shares redeemed 1,967,587 51,298
Advisory fee payable--Note 3 39,683 27,358
Administration fee payable--Note 3 18,982 6,865
Accrued expenses and other liabilities 97,755 48,713
------------ -----------
Total Liabilities 3,961,842 298,301
------------ -----------
Net Assets $105,362,718 $31,553,246
============ ===========
NET ASSETS
Capital paid-in $ 64,199,511 $39,750,436
Undistributed (distributions in excess of) net
investment income 1,639,430 (25,207)
Accumulated net realized gain (loss) on
investments and foreign currency transactions 41,055,733 (3,672,516)
Net unrealized appreciation (depreciation) on
investments and foreign currency translations (1,531,956) (4,499,467)
------------ -----------
Net Assets $105,362,718 $31,553,246
============ ===========
INVESTOR CLASS:
Net asset value, offering and redemption price
per share $ 16.74 $ 10.49
Total shares outstanding at end of period 6,295,329 3,006,741
Cost of securities including repurchase agreements $105,700,756 $35,077,799
Cost of foreign currency $ 103,546 $ 638,494
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
40
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL
SMALLER U.S. LARGE CAP U.S. SMALLER MICRO
COMPANIES EQUITY COMPANIES CAP
FUND FUND FUND FUND
----------------- --------------- ------------- -----------
<S> <C> <C> <C> <C>
ASSETS
Investments in securities, at value--Note 2 $18,300,736 $48,179,850 $61,883,217 $69,864,705
Repurchase agreements -- -- 756,000 14,071,000
Cash -- -- 570 606
Foreign currency, at value -- -- -- --
Dividends and tax reclaims receivable 26,708 17,777 11,113 127,250
Interest receivable 3,820 4,858 30,163 40,535
Receivable for securities sold 121,467 253,676 1,285,241 2,472,159
Receivable for foreign currency contracts sold 59,544 -- -- --
Receivable for Fund shares sold 537,974 6,320 72,321 195,490
Deferred organizational costs 2,995 -- 3,952 --
Prepaid expenses 13,891 971 29,098 47
Due from Investment Advisor--Note 3 32,934 -- -- 21,343
----------- ----------- ----------- -----------
Total Assets 19,100,069 48,463,452 64,071,675 86,793,135
----------- ----------- ----------- -----------
LIABILITIES
Payable for securities purchased 405,987 -- 310,771 5,630,754
Payable for foreign currency contracts purchased -- -- -- --
Payable for Fund shares redeemed -- 7,785 127 16,490
Advisory fee payable--Note 3 11,656 51,935 26,766 83,258
Administration fee payable--Note 3 3,863 -- 13,420 16,636
Accrued expenses and other liabilities 44,485 76,637 83,609 60,672
----------- ----------- ----------- -----------
Total Liabilities 465,991 136,357 434,693 5,807,810
----------- ----------- ----------- -----------
Net Assets $18,634,078 $48,327,095 $63,636,982 $80,985,325
=========== =========== =========== ===========
NET ASSETS
Capital paid-in $15,355,076 $43,962,650 $43,491,035 $37,747,476
Undistributed (distributions in excess of) net
investment income 42,076 -- -- --
Accumulated net realized gain (loss) on
investments and foreign currency transactions 2,854,328 (66,800) 9,346,087 36,238,429
Net unrealized appreciation (depreciation) on
investments and foreign currency translations 382,598 4,431,245 10,799,860 6,999,420
----------- ----------- ----------- -----------
Net Assets $18,634,078 $48,327,095 $63,636,982 $80,985,325
=========== =========== =========== ===========
INVESTOR CLASS:
Net asset value, offering and redemption price
per share $ 15.50 $ 4.95 $ 18.01 $ 46.19
Total shares outstanding at end of period 1,202,023 9,753,327 3,533,809 1,753,374
Cost of securities including repurchase agreements $17,977,378 $43,748,605 $51,839,357 $76,936,285
Cost of foreign currency $ -- $ -- $ -- $ --
</TABLE>
--------------------------------------------------------------------------------
41
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 31, 2000
<TABLE>
<CAPTION>
EMERGING
INTERNATIONAL MARKETS
FUND FUND
------------- -----------
<S> <C> <C>
INVESTMENT INCOME
Dividend income $ 1,721,521 $ 218,962
Interest income 475,996 79,167
Foreign taxes withheld (239,075) (18,762)
------------ -----------
Total Income 1,958,442 279,367
------------ -----------
EXPENSES
Investment advisory fees--Note 3 610,287 257,314
Shareholder servicing fees--Note 4 -- --
Administrative fees--Note 3 287,297 64,329
Subadministration fees--Note 3 132,282 37,130
Custodian fees 220,738 139,626
Audit fees 76,001 32,002
Legal fees 32,472 9,202
Printing expenses 17,707 30,493
Trustees fees--Note 5 28,982 4,659
Transfer agent fees 25,744 15,166
Organizational expenses -- 195
Registration fees 18,847 14,002
Other 16,370 1,247
------------ -----------
Total Expenses 1,466,727 605,365
Expenses borne by Investment Adviser--Note 3 (166,562) (167,944)
Expenses waived by Investment Adviser--Note 3 (35,646) --
------------ -----------
Net Expenses 1,264,519 437,421
------------ -----------
Net Investment Income (Loss) 693,923 (158,054)
------------ -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) on investments sold (a) 43,292,573 (3,356,038)
Net realized gain (loss) on foreign currency
transactions 391,584 (63,405)
------------ -----------
Net realized gain (loss) on investments and
foreign currency transactions 43,684,157 (3,419,443)
------------ -----------
Change in net unrealized appreciation
(depreciation) on investments (26,978,546) (4,872,379)
Change in net unrealized appreciation
(depreciation) on foreign currency
translations 766,731 9,589
------------ -----------
Net change in unrealized appreciation
(depreciation) on investments and foreign
currency translations (26,211,815) (4,862,790)
------------ -----------
Net Gain (Loss) 17,472,342 (8,282,233)
------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 18,166,265 $(8,440,287)
============ ===========
</TABLE>
--------------
(a) Includes capital gains taxes for sales of Thailand securities in the amount
of $6,152 for Schroder Emerging Markets Fund.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
42
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INTERNATIONAL U.S. LARGE CAP U.S. SMALLER MICRO
SMALLER COMPANIES EQUITY COMPANIES CAP
FUND FUND FUND FUND
------------------ -------------- ------------ -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Dividend income $ 183,063 $ 98,597 $ 141,901 $ 204,387
Interest income 35,618 21,217 280,552 593,905
Foreign taxes withheld (22,472) (953) -- --
----------- ----------- ----------- -----------
Total Income 196,209 118,861 422,453 798,292
----------- ----------- ----------- -----------
EXPENSES
Investment advisory fees--Note 3 134,350 147,762 258,160 623,920
Shareholder servicing fees--Note 4 -- -- 6,211 --
Administrative fees--Note 3 39,510 -- 139,750 124,784
Subadministration fees--Note 3 20,250 21,778 58,903 53,552
Custodian fees 63,098 40,660 93,172 94,245
Audit fees 28,003 8,212 28,689 36,395
Legal fees 13,003 22,014 22,014 22,014
Printing expenses 25,739 10,007 20,576 26,395
Trustees fees--Note 5 3,574 2,402 11,879 7,518
Transfer agent fees 15,134 21,613 40,738 19,143
Organizational expenses 9,093 -- 5,017 --
Registration fees 14,002 18,184 22,848 18,930
Other 1,111 10,350 4,551 292
----------- ----------- ----------- -----------
Total Expenses 366,867 302,982 712,508 1,027,188
Expenses borne by Investment Adviser--Note 3 (113,864) -- (3,721) (30,346)
Expenses waived by Investment Adviser--Note 3 (15,821) (29,632) -- --
----------- ----------- ----------- -----------
Net Expenses 237,182 273,350 708,787 996,842
----------- ----------- ----------- -----------
Net Investment Income (Loss) (40,973) (154,489) (286,334) (198,550)
----------- ----------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) on investments sold (a) 2,855,791 4,197,406 10,252,989 36,292,977
Net realized gain (loss) on foreign currency
transactions 57,965 24 -- (12)
----------- ----------- ----------- -----------
Net realized gain (loss) on investments and
foreign currency transactions 2,913,756 4,197,430 10,252,989 36,292,965
----------- ----------- ----------- -----------
Change in net unrealized appreciation
(depreciation) on investments (1,075,329) (2,977,776) 7,939,225 5,630,333
Change in net unrealized appreciation
(depreciation) on foreign currency
translations 70,121 -- -- --
----------- ----------- ----------- -----------
Net change in unrealized appreciation
(depreciation) on investments and foreign
currency translations (1,005,208) (2,977,776) 7,939,225 5,630,333
----------- ----------- ----------- -----------
Net Gain (Loss) 1,908,548 1,219,654 18,192,214 41,923,298
----------- ----------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 1,867,575 $ 1,065,165 $17,905,880 $41,724,748
=========== =========== =========== ===========
</TABLE>
--------------
(a) Includes capital gains taxes for sales of Thailand securities in the amount
of $6,152 for Schroder Emerging Markets Fund.
--------------------------------------------------------------------------------
43
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
INTERNATIONAL FUND
----------------------------------
Year Ended Year Ended
October 31, 2000 October 31, 1999
---------------- ----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
From Operations:
Net investment (loss) income $ 693,923 $ 858,784
Net realized gain (loss) on
investments and foreign currency
transactions 43,684,157 14,091,624
Change in net unrealized appreciation
(depreciation) on investments and
foreign currency translations (26,211,815) 13,193,036
------------- -------------
Net increase (decrease) in net assets
resulting from operations 18,166,265 28,143,444
------------- -------------
Dividends and Distributions to Investor
Shareholders:
From net investment income (589,679) (1,311,873)
From net realized capital gains (12,889,783) (22,931,620)
Dividends and Distributions to Advisor
Shareholders:
From net investment income -- --
From net realized capital gains -- (17)
------------- -------------
(13,479,462) (24,243,510)
------------- -------------
INVESTOR SHARE TRANSACTIONS:
Sales of shares 255,035,992 105,900,667
Reinvestment of distributions 12,350,145 18,465,458
Redemptions of shares (324,330,164) (100,600,791)
------------- -------------
Total increase (decrease) from
Investor Share transactions (56,944,027) 23,765,334
------------- -------------
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- --
Reinvestment of distributions -- --
Redemptions of shares -- (100)
------------- -------------
Total increase (decrease) from Advisor
Share transactions -- (100)
------------- -------------
Total increase (decrease) in net
assets (52,257,224) 27,665,168
NET ASSETS
Beginning of Period 157,619,942 129,954,774
------------- -------------
End of period $ 105,362,718 $ 157,619,942
============= =============
Undistributed (distributions in excess
of) net investment income $ 1,639,430 $ 1,145,028
============= =============
CHANGES IN FUND SHARES
INVESTOR SHARE TRANSACTIONS:
Sales of shares 14,344,933 6,591,795
Reinvestment of distributions 723,076 1,232,674
Redemption of shares (18,035,607) (6,159,592)
------------- -------------
Net increase (decrease) in Investor
Shares (2,967,598) 1,664,877
============= =============
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- --
Reinvestment of distributions -- --
Redemption of shares -- (5)
------------- -------------
Net increase (decrease) in Advisor
Shares -- (5)
============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
44
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
EMERGING MARKETS FUND
------------------------------------------------
For the Period
Year Ended June 1, 1999 to Year Ended
October 31, 2000 October 31, 1999 May 31, 1999
---------------- ---------------- ------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
From Operations:
Net investment (loss) income $ (158,054) $ (6,273) $ 5,785
Net realized gain (loss) on
investments and foreign
currency transactions (3,419,443) 246,833 202,377
Change in net unrealized
appreciation (depreciation) on
investments and foreign
currency translations (4,862,790) 128,134 237,379
------------ ----------- -----------
Net increase (decrease) in net
assets resulting from
operations (8,440,287) 368,694 445,541
------------ ----------- -----------
Dividends and Distributions to
Investor Shareholders:
From net investment income (71,978) -- (1,988)
From net realized capital gains (292,305) -- --
Dividends and Distributions to
Advisor Shareholders:
From net investment income -- -- --
From net realized capital gains -- -- --
------------ ----------- -----------
(364,283) -- (1,988)
------------ ----------- -----------
INVESTOR SHARE TRANSACTIONS:
Sales of shares 56,195,530 3,568,272 5,729,736
Reinvestment of distributions 364,283 -- 1,988
Redemptions of shares (19,364,379) (2,992,318) (3,975,370)
------------ ----------- -----------
Total increase (decrease) from
Investor Share transactions 37,195,434 575,954 1,756,354
------------ ----------- -----------
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- -- --
Reinvestment of distributions -- -- --
Redemptions of shares -- -- --
------------ ----------- -----------
Total increase (decrease) from
Advisor Share transactions -- -- --
------------ ----------- -----------
Total increase (decrease) in net
assets 28,390,864 944,648 2,199,907
NET ASSETS
Beginning of Period 3,162,382 2,217,734 17,827
------------ ----------- -----------
End of Period $ 31,553,246 $ 3,162,382 $ 2,217,734
============ =========== ===========
Undistributed (distributions in
excess of) net investment income $ (25,207) $ 63,557 $ 6,691
============ =========== ===========
CHANGES IN FUND SHARES
INVESTOR SHARE TRANSACTIONS:
Sales of shares 4,147,126 295,733 636,064
Reinvestment of distributions 27,064 -- 233
Redemption of shares (1,427,077) (244,868) (429,505)
------------ ----------- -----------
Net increase (decrease) in
Investor Shares 2,747,113 50,865 206,792
============ =========== ===========
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- -- --
Reinvestment of distributions -- -- --
Redemption of shares -- -- --
------------ ----------- -----------
Net increase (decrease) in
Advisor Shares -- -- --
============ =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
45
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
INTERNATIONAL SMALLER
COMPANIES FUND
----------------------------------
Year Ended Year Ended
October 31, 2000 October 31, 1999
---------------- ----------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
From Operations:
Net investment (loss) income $ (40,973) $ 37,236
Net realized gain (loss) on
investments and foreign currency
transactions 2,913,756 1,360,816
Change in net unrealized appreciation
(depreciation) on investments and
foreign currency translations (1,005,208) 2,006,872
------------ -----------
Net increase (decrease) in net assets
resulting from operations 1,867,575 3,404,924
------------ -----------
Dividends and Distributions to Investor
Shareholders:
From net investment income (5,696) (16,342)
From net realized capital gains (1,351,877) (313,960)
Dividends and Distributions to Advisor
Shareholders:
From net investment income -- --
From net realized capital gains -- --
------------ -----------
(1,357,573) (330,302)
------------ -----------
INVESTOR SHARE TRANSACTIONS:
Sales of shares 28,691,256 3,936,628
Reinvestment of distributions 1,269,385 104,039
Redemptions of shares (21,672,515) (1,444,023)
------------ -----------
Total increase (decrease) from
Investor Share transactions 8,288,126 2,596,644
------------ -----------
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- --
Reinvestment of distributions -- --
Redemptions of shares -- --
------------ -----------
Total increase (decrease) from Advisor
Share transactions -- --
------------ -----------
Total increase (decrease) in net
assets 8,798,128 5,671,266
NET ASSETS
Beginning of period 9,835,950 4,164,684
------------ -----------
End of period $ 18,634,078 $ 9,835,950
============ ===========
Undistributed (distributions in excess
of) net investment income $ 42,076 $ 30,780
============ ===========
CHANGES IN FUND SHARES
INVESTOR SHARE TRANSACTIONS:
Sales of shares 1,624,433 341,062
Reinvestment of distributions 82,740 11,420
Redemption of shares (1,193,338) (109,607)
------------ -----------
NET INCREASE (DECREASE) IN INVESTOR
SHARES 513,835 242,875
============ ===========
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- --
Reinvestment of distributions -- --
Redemption of shares -- --
------------ -----------
Net increase (decrease) in Advisor
Shares -- --
============ ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
46
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
U.S. LARGE CAP EQUITY FUND
----------------------------------------
Year Ended Year Ended
October 31, 2000 October 31, 1999
------------------- -------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
From Operations:
Net investment (loss) income $ (154,489) $ (128,036)
Net realized gain (loss) on
investments and foreign currency
transactions 4,197,430 1,801,211
Change in net unrealized appreciation
(depreciation) on investments and
foreign currency translations (2,977,776) 1,962,730
----------- -----------
Net increase (decrease) in net assets
resulting from operations 1,065,165 3,635,905
----------- -----------
Dividends and Distributions to Investor
Shareholders:
From net investment income -- --
From net realized capital gains (5,718,509) (4,808,678)
From return of capital (730,929) --
Dividends and Distributions to Advisor
Shareholders:
From net investment income -- --
From net realized capital gains -- --
----------- -----------
(6,449,438) (4,808,678)
----------- -----------
INVESTOR SHARE TRANSACTIONS:
Sales of shares 3,152,992 237,273
Reinvestment of distributions 5,064,753 3,726,473
Redemptions of shares (5,917,223) (1,221,470)
Issuance of Merger Shares--(Note 10) 37,300,982 --
----------- -----------
Total increase (decrease) from
Investor Share transactions 39,601,504 2,742,276
----------- -----------
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- --
Reinvestment of distributions -- --
Redemptions of shares -- --
----------- -----------
Total increase (decrease) from Advisor
Share transactions -- --
----------- -----------
Total increase (decrease) in net
assets 34,217,231 1,569,503
NET ASSETS
Beginning of Period 14,109,864 12,540,361
----------- -----------
End of Period $48,327,095 $14,109,864
=========== ===========
Undistributed (distributions in excess
of) net investment income $ -- $ --
=========== ===========
CHANGES IN FUND SHARES
INVESTOR SHARE TRANSACTIONS:
Sales of shares 574,897 50,376
Reinvestment of distributions 936,388 640,288
Redemption of shares (1,075,751) (202,406)
Issuance of Merger Shares 7,220,033 --
----------- -----------
Net increase (decrease) in Investor
Shares 7,655,567 488,258
=========== ===========
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- --
Reinvestment of distributions -- --
Redemption of shares -- --
----------- -----------
Net increase (decrease) in Advisor
Shares -- --
=========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
47
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
U.S. SMALLER COMPANIES FUND
---------------------------------------------------------
For the Period
Year Ended June 1, 1999 Year Ended
October 31, 2000 October 31, 1999 May 31, 1999
------------------- ------------------- ---------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
From Operations:
Net investment income $ (286,334) $ (120,661) $ (380,568)
Net realized gain (loss) on
investments and foreign
currency transactions 10,252,989 1,996,019 (5,520,499)
Change in net unrealized
appreciation (depreciation) on
investments and foreign
currency translations 7,939,225 (1,771,479) (3,940,525)
------------ ------------ ------------
Net increase (decrease) in net
assets resulting from
operations 17,905,880 103,879 (9,841,592)
------------ ------------ ------------
Dividends and Distributions to
Investor Shareholders:
From net investment income -- -- --
From net realized capital gains -- -- (115,656)
Dividends and Distributions to
Advisor Shareholders:
From net investment income -- -- --
From net realized capital gains -- -- (12,796)
------------ ------------ ------------
-- -- (128,452)
------------ ------------ ------------
INVESTOR SHARE TRANSACTIONS:
Sales of shares 30,111,189 4,665,045 48,301,794
Reinvestment of distributions -- -- 114,698
Redemptions of shares (24,922,951) (10,478,035) (42,480,798)
------------ ------------ ------------
Total increase (decrease) from
Investor Share transactions 5,188,238 (5,812,990) 5,935,694
------------ ------------ ------------
ADVISOR SHARE TRANSACTIONS:
Sales of shares 2,274,004 807,383 5,849,691
Reinvestment of distributions -- -- 12,796
Redemptions of shares (8,714,849) (867,866) (5,298,368)
------------ ------------ ------------
Total increase (decrease) from
Advisor Share transactions (6,440,845) (60,483) 564,119
------------ ------------ ------------
Total increase (decrease) in net
assets 16,653,273 (5,769,594) (3,470,231)
NET ASSETS
Beginning of Period 46,983,709 52,753,303 56,223,534
------------ ------------ ------------
End of Period $ 63,636,982 $ 46,983,709 $ 52,753,303
============ ============ ============
Undistributed (distributions in
excess of) net investment income $ -- $ (120,661) $ --
============ ============ ============
CHANGES IN FUND SHARES
INVESTOR SHARE TRANSACTIONS:
Sales of shares 1,847,371 359,380 3,708,043
Reinvestment of distributions -- -- 9,456
Redemption of shares (1,611,841) (801,878) (3,477,759)
------------ ------------ ------------
Net increase (decrease) in
Investor Shares 235,530 (442,498) 239,740
============ ============ ============
ADVISOR SHARE TRANSACTIONS:
Sales of shares 146,819 62,559 524,063
Reinvestment of distributions -- -- 1,058
Redemption of shares (524,652) (67,963) (450,609)
------------ ------------ ------------
Net increase (decrease) in
Advisor Shares (377,833) (5,404) 74,512
============ ============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
48
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
MICRO CAP FUND
---------------------------------------------------------
For the Period
Year Ended June 1, 1999 Year Ended
October 31, 2000 October 31, 1999 May 31, 1999
------------------- ------------------- ---------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
From Operations:
Net investment (loss) income $ (198,550) $ (51,272) $ (90,189)
Net realized gain (loss) on
investments and foreign
currency transactions 36,292,965 3,611,077 3,798,687
Change in net unrealized
appreciation (depreciation) on
investments and foreign
currency translations 5,630,333 (154,964) 932,978
----------- ----------- -----------
Net increase (decrease) in net
assets resulting from
operations 41,724,748 3,404,841 4,641,476
----------- ----------- -----------
Dividends and Distributions to
Investor Shareholders:
From net investment income -- -- --
From net realized capital gains (5,813,221) -- (1,091,088)
Dividends and Distributions to
Advisor Shareholders:
From net investment income -- -- --
From net realized capital gains -- -- --
----------- ----------- -----------
(5,813,221) -- (1,091,088)
----------- ----------- -----------
INVESTOR SHARE TRANSACTIONS:
Sales of shares 26,653,984 3,871,457 6,563,434
Reinvestment of distributions 5,642,897 -- 770,633
Redemptions of shares (7,818,665) (998,073) (2,906,697)
----------- ----------- -----------
Total increase (decrease) from
Investor Share transactions 24,478,216 2,873,384 4,427,370
----------- ----------- -----------
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- -- --
Reinvestment of distributions -- -- --
Redemptions of shares -- -- --
----------- ----------- -----------
Total increase (decrease) from
Advisor Share transactions -- -- --
----------- ----------- -----------
Total increase (decrease) in net
assets 60,389,743 6,278,225 7,977,758
NET ASSETS
Beginning of Period 20,595,582 14,317,357 6,339,599
----------- ----------- -----------
End of Period $80,985,325 $20,595,582 $14,317,357
=========== =========== ===========
Undistributed (distributions in
excess of) net investment income $ -- $ -- $ --
=========== =========== ===========
CHANGES IN FUND SHARES
INVESTOR SHARE TRANSACTIONS:
Sales of shares 887,828 174,358 409,850
Reinvestment of distributions 280,741 -- 56,415
Redemption of shares (252,899) (46,302) (201,229)
----------- ----------- -----------
Net increase (decrease) in
Investor Shares 915,670 128,056 265,036
=========== =========== ===========
ADVISOR SHARE TRANSACTIONS:
Sales of shares -- -- --
Reinvestment of distributions -- -- --
Redemption of shares -- -- --
----------- ----------- -----------
Net increase (decrease) in
Advisor Shares -- -- --
=========== =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
49
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS--INVESTOR SHARES
Selected per share data and ratios for an Investor share outstanding
throughout each period:
<TABLE>
<CAPTION>
For the Year Ended October 31,
------------------------------------------------
2000 1999 1998 1997 1996 (a)
<S> <C> <C> <C> <C> <C>
---------------------------------------------------------------------------
Net Asset Value,
Beginning of Period $ 17.02 $ 17.10 $ 18.37 $ 20.01 $ 20.91
-------- -------- -------- -------- --------
Investment Operations (b)
Net Investment Income 0.15 0.07 0.23 0.14 0.15
Net Realized and
Unrealized Gain
(Loss) on Investments
and Foreign Currency
Transactions 1.24 3.20 0.34 1.31 1.74
-------- -------- -------- -------- --------
Total from Investment
Operations 1.39 3.27 0.57 1.45 1.89
-------- -------- -------- -------- --------
Distributions From
Net Investment Income (0.07) (0.18) (0.29) (0.46) (0.47)
Net Realized Gain on
Investments and
Foreign Currency
Transactions (1.60) (3.17) (1.55) (2.63) (2.32)
-------- -------- -------- -------- --------
Total Distributions (1.67) (3.35) (1.84) (3.09) (2.79)
-------- -------- -------- -------- --------
Net Asset Value, End of
Period $ 16.74 $ 17.02 $ 17.10 $ 18.37 $ 20.01
======== ======== ======== ======== ========
Total Return (c) 8.02% 21.82% 3.82% 8.33% 10.05%
Ratios and Supplemental
Data:
Net Assets at End of
Period (in thousands) $105,363 $157,620 $129,955 $191,219 $202,735
Ratios to Average Net
Assets: (b)
Expenses including
reimbursement/waiver
of fees 0.99% 0.99% 0.99% 0.99% 0.99%
Expenses excluding
reimbursement/waiver
of fees 1.14% 1.06% 1.08% 1.06% 1.04%
Net investment income
including
reimbursement/waiver of
fees 0.54% 0.60% 1.14% 0.67% 0.86%
Portfolio Turnover Rate
(d) 132% 85% 53% 36% 56%
</TABLE>
--------------
(a) On November 1, 1995, the Fund converted to a master-feeder structure.
(b) From the period November 1, 1995 to May 31, 1999, the Fund recognized its
proportionate share of income, expenses and gains/losses of its underlying
Portfolio, Schroder International Equity Portfolio. Since June 1, 1999, the
income, expenses and gains/losses were directly accrued to the Fund.
(c) Total returns would have been lower had certain Fund expenses not been
waived or reimbursed during the periods shown (See Note 3).
(d) The portfolio turnover rates for the years October 31, 1996 through
October 31, 1998, represent the turnover of the underlying Portfolio,
International Equity Portfolio. For the year ending October 31, 1999, the
rate represents the period from November 1, 1998 through May 31, 1999
during which time the Fund invested in the Portfolio and from June 1, 1999
through October 31, 1999 during which time the Fund held direct investments
in a portfolio of securities.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
50
<PAGE>
--------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS--INVESTOR SHARES
Selected per share data and ratios for an Investor Share outstanding
throughout each period:
<TABLE>
<CAPTION>
For the Year For the Period For the Year For the Period
Ended Ended Ended Ended
October 31, 2000 October 31, 1999 (a) May 31, 1999 May 31, 1998 (f)
<S> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of
Period $ 12.18 $ 10.62 $ 9.04 $ 10.00
-------------- ---------------- ----------- -------------
Investment Operations (b)
Net Investment Income (Loss) (0.18) (0.03) 0.03 0.02
Net Realized and Unrealized
Gain (Loss) on Investments
and Foreign Currency
Transactions (0.90) 1.59 1.58 (0.98)
-------------- ---------------- ----------- -------------
Total from Investment
Operations (1.08) 1.56 1.61 (0.96)
-------------- ---------------- ----------- -------------
Distributions from
Net Investment Income (0.12) -- (0.03) --
Net Realized Gain on
Investments and Foreign
Currency Transactions (0.49) -- -- --
-------------- ---------------- ----------- -------------
Total Distributions (0.61) -- (0.03) --
-------------- ---------------- ----------- -------------
Net Asset Value, End of Period $ 10.49 $ 12.18 $ 10.62 $ 9.04
============== ================ =========== =============
Total Return (c) (10.00)% 14.69% 17.88% (9.60)%
Ratios and Supplementary Data
Net Assets at End of Period
(in thousands) $ 31,553 $ 3,162 $ 2,218 $ 18
Ratios to Average Net Assets:
(b)
Expenses including
reimbursement/ waiver of
fees 1.70% 1.70%(d) 1.65% 1.70%(d)
Expenses excluding
reimbursement/ waiver of
fees 2.35% 7.84%(d) 10.74% --(e)
Net investment income
including
reimbursement/waiver of
fees (0.61)% (0.59)%(d) 0.51% 1.72%(d)
Portfolio Turnover Rate (g) 192% 160% 177% 23%
</TABLE>
----------------
(a) Effective October 31, 1999, the Fund changed its fiscal year end from
May 31 to October 31.
(b) Prior to September 17, 1999, the Fund recognized its proportionate share of
income, expenses and gains/losses of its underlying Portfolio, Schroder EM
Core Portfolio. Since September 20, 1999, the income, expenses and
gains/losses were directly accrued to the Fund.
(c) Total returns would have been lower had certain Fund expenses not been
waived or reimbursed during the periods shown. (See Note 3). Total return
calculations for a period of less than one year are not annualized.
(d) Annualized.
(e) Amount is not meaningful due to short period of operations.
(f) The Fund commenced operations on October 31, 1997.
(g) The portfolio turnover rates for the period ending May 31, 1998 and year
ended May 31, 1999 represent the turnover of the underlying Portfolio,
Schroder EM Core Portfolio. For the period ending October 31, 1999, the
rate represents the period from June 1, 1999 through September 17, 1999
during which time the Fund invested in the Portfolio and from September 20,
1999 through October 31, 1999, during which time the Fund held direct
investments in a portfolio of securities.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
51
<PAGE>
--------------------------------------------------------------------------------
SCHRODER INTERNATIONAL SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS--INVESTOR SHARES
Selected per share data and ratios for an Investor Share outstanding
throughout each period:
<TABLE>
<CAPTION>
For the Period
For the Year Ended October 31, Ended
--------------------------------- October 31,
2000 1999 1998 1997 (a)
<S> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 14.29 $ 9.35 $ 9.22 $ 10.00
------- ------- ------ ------------
Investment Operations (b)
Net Investment Income (Loss) (0.05) 0.06 0.05 0.02
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currency
Transactions 3.23 5.62 0.60 (0.79)
------- ------- ------ ------------
Total from Investment Operations 3.18 5.68 0.65 (0.77)
------- ------- ------ ------------
Distributions From
Net Investment Income (0.01) (0.04) (0.01) (0.01)
Net Realized Gain on Investments and
Foreign Currency Transactions (1.96) (0.70) (0.51) --
------- ------- ------ ------------
Total Distributions (1.97) (0.74) (0.52) (0.01)
------- ------- ------ ------------
Net Asset Value, End of Period $ 15.50 $ 14.29 $ 9.35 $ 9.22
======= ======= ====== ============
Total Return (c) 22.37% 65.27% 7.88% (7.73)%
Ratios and Supplemental Data:
Net Assets at End of Period (in thousands) $18,634 $ 9,836 $4,165 $ 6,836
Ratios to Average Net Assets: (b)
Expenses including reimbursement/waiver of
fees 1.50% 1.50% 1.50% 1.50%(d)
Expenses excluding reimbursement/waiver of
fees 2.32% 2.74% 5.26% 3.93%(d)
Net investment income including
reimbursement/ waiver of fees (0.26)% 0.53% 0.33% 0.21%(d)
Portfolio Turnover Rate (e) 86% 81% 82% 32%
</TABLE>
--------------
(a) For the period November 4, 1996 (Commencement of Operations) through
October 31, 1997.
(b) Prior to June 1, 1999, the Fund recognized its proportionate share of
income, expenses and gains/losses of its underlying Portfolio, Schroder
International Smaller Companies Portfolio. Since June 1, 1999, the income,
expenses and gains/losses were directly accrued to the Fund.
(c) Total returns would have been lower had certain Fund expenses not been
waived or reimbursed during the periods shown (See Note 3). Total return
calculations for a period of less than one year are not annulized.
(d) Annualized.
(e) The portfolio turnover rates for the period ending October 31, 1997 and
year ended October 31, 1998 represent the turnover of the underlying
Portfolio, Schroder International Smaller Companies Portfolio. For the year
ending October 31, 1999, the rate represents the period from November 1,
1998 through May 31, 1999 during which time the Fund invested in the
Portfolio and from June 1, 1999 through October 31, 1999 during which time
the Fund held direct investments in a portfolio of securities.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
52
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. LARGE CAP EQUITY FUND (A)
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS--INVESTOR SHARES
Selected per share data and ratios for an Investor Share outstanding
throughout each period:
<TABLE>
<CAPTION>
For the Year Ended October 31,
-------------------------------------------
2000 1999 1998 1997 1996
<S> <C> <C> <C> <C> <C>
----------------------------------------------------------------------
Net Asset Value,
Beginning of Period $ 6.73 $ 7.79 $ 9.82 $ 9.76 $ 9.41
------- ------- ------- ------- -------
Investment Operations
Net Investment Income
(Loss) (0.02) (0.06) (0.06) (0.01) 0.04
Net Realized and
Unrealized Gain
(Loss) on Investments 1.26 2.00 0.78 2.20 1.62
------- ------- ------- ------- -------
Total from Investment
Operations 1.24 1.94 0.72 2.19 1.66
------- ------- ------- ------- -------
Distributions From
Net Investment Income -- -- -- (0.02) (0.07)
Net Realized Gain on
Investments (2.68) (3.00) (2.75) (2.11) (1.24)
Return of Capital (0.34) -- -- -- --
------- ------- ------- ------- -------
Total Distributions (3.02) (3.00) (2.75) (2.13) (1.31)
------- ------- ------- ------- -------
Net Asset Value, End of
Period $ 4.95 $ 6.73 $ 7.79 $ 9.82 $ 9.76
======= ======= ======= ======= =======
Total Return (b) 18.73% 30.95% 8.87% 26.49% 19.45%
Ratios and Supplementary
Data:
Net Assets at End of
Period (in thousands)
(c) $48,327 $14,110 $12,540 $13,861 $17,187
Ratios to Average Net
Assets:
Expenses including
reimbursement/waiver
of fees 1.40% 1.50% 1.50% 1.50% 1.40%
Expenses excluding
reimbursement/waiver
of fees 1.55% 1.99% 1.85% 1.68% 1.43%
Net investment income
including
reimbursement/waiver
of fees (0.79)% (0.93)% (0.71)% (0.09)% 0.43%
Portfolio Turnover Rate 195% 87% 209% 44% 57%
</TABLE>
--------------
(a) The Fund changed its name from "Schroder U.S. Diversified Growth Fund" to
"Schroder U.S. Large Cap Equity Fund" effective September 14, 2000.
(b) Total returns would have been lower had certain Fund expenses not been
waived or reimbursed during the periods shown (see Note 3).
(c) Net assets as of October 31, 2000 reflect the Fund's acquisition of the net
assets of Schroder Large Capitalization Equity Fund as of September 11,
2000. See Note 10.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
53
<PAGE>
--------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS--INVESTOR SHARES
Selected per share data and ratios for an Investor Share outstanding
throughout each period:
<TABLE>
<CAPTION>
For the Year For the Period For the Year Ended For the Period For the Year
Ended Ended May 31 Ended Ended
October 31, October 31, -------------------------- May 31, October 31,
2000 1999 (b) 1999 1998 1997 (g) 1996 (a)
<S> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------------------------------------------------------
Net Asset Value,
Beginning of Period $ 12.79 $ 12.80 $ 14.76 $ 13.26 $ 17.23 $ 15.14
------- ------- -------- ------- ------- -------
Investment Operations (c)
Net Investment Income
(Loss) (0.08) (0.03) (0.09) (0.06) (0.02) (0.06)
Net Realized and
Unrealized Gain
(Loss) on Investments 5.30 0.02 (1.84) 2.82 1.88 4.10
------- ------- -------- ------- ------- -------
Total from Investment
Operations 5.22 (0.01) (1.93) 2.76 1.86 4.04
------- ------- -------- ------- ------- -------
Distributions From
Net Investment Income -- -- -- -- -- --
------- ------- -------- ------- ------- -------
Net Realized Gain on
Investments -- -- (0.03) (1.26) (5.83) (1.95)
Total Distributions -- -- (0.03) (1.26) (5.83) (1.95)
------- ------- -------- ------- ------- -------
Net Asset Value, End of
Period $ 18.01 $ 12.79 $ 12.80 $ 14.76 $ 13.26 $ 17.23
======= ======= ======== ======= ======= =======
Total Return (d) 40.81% (0.08)% (13.08)% 21.63% 14.73% 29.35%
Ratios and Supplementary
Data
Net Assets at End of
Period (in thousands) $63,637 $42,177 $ 47,870 $51,679 $26,104 $13,743
Ratios to Average Net
Assets: (c)
Expenses including
reimbursement/waiver
of fees 1.18% 1.35%(e) 1.42% 1.37% 1.49%(e) 1.49%
Expenses excluding
reimbursement/waiver
of fees 1.18% 1.35%(e) 1.45% 1.37% 1.87%(e) N/A
Net investment income
(loss) including
reimbursement/ waiver
of fees (0.55)% (0.54)%(e) (0.65)% (0.51)% (0.42)%(e) (0.35)%
Portfolio Turnover Rate
(f) 172% 52% 119% 55% 34% 59%
</TABLE>
------------------
(a) On August 15, 1996, the Fund converted to a master-feeder structure.
(b) Effective October 31, 1999, the Fund changed it's fiscal year end from
May 31 to October 31.
(c) From November 1, 1995 to May 31, 1999, the Fund recognized its
proportionate share of income, expenses and gains/losses of its underlying
Portfolio, Schroder U.S. Smaller Companies Portfolio. Since June 1, 1999,
the income, expenses were directly accrued to the Fund.
(d) Total returns would have been lower had certain expenses not been waived or
reimbursed during the periods shown (See Note 3). Total return calculations
for a period of less than one year are not annualized.
(e) Annualized.
(f) The portfolio turnover rates for the periods October 31, 1996 through
May 31, 1999, represent the turnover of the underlying Portfolio, Schroder
U.S. Smaller Companies Portfolio. The rates for subsequent periods
represent the turnover of the Fund, which held direct investments in a
porfolio of securities.
(g) Effective May 31, 1997, the Fund changed its fiscal year end from
October 31 to May 31.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
54
<PAGE>
--------------------------------------------------------------------------------
SCHRODER MICRO CAP FUND
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS--INVESTOR SHARES
Selected per share data and ratios for an Investor Share outstanding
throughout each period:
<TABLE>
<CAPTION>
For the Year For the Period For the Year For the Period
Ended Ended Ended Ended
October 31, 2000 October 31, 1999 (a) May 31, 1999 May 31, 1998 (d)
<S> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of
Period $ 24.59 $ 20.18 $ 14.26 $ 10.00
------------- ------- ------- -------------
Investment Operations
Net Investment Income (Loss) (0.11) (0.06) (0.13) (0.04)
Net Realized and Unrealized
Gain (Loss) on Investments 28.83 4.47 8.28 4.50
------------- ------- ------- -------------
Total from Investment
Operations 28.72 4.41 8.15 4.46
------------- ------- ------- -------------
Distributions From
Net Investment Income -- -- -- --
Net Realized Gain on
Investments (7.12) -- (2.23) (0.20)
------------- ------- ------- -------------
Total Distributions (7.12) -- (2.23) (0.20)
------------- ------- ------- -------------
Net Asset Value, End of Period $ 46.19 $ 24.59 $ 20.18 $ 14.26
============= ======= ======= =============
Total Return (b) 154.40% 21.85% 64.56% 45.41%
Ratios and Supplemental Data:
Net Assets at End of Period
(in thousands) $ 80,985 $20,596 $14,317 $ 6,340
Ratios to Average Net Assets:
Expenses including
reimbursement/ waiver of
fees 2.00% 2.00%(c) 2.00% 2.00%(c)
Expenses excluding
reimbursement/ waiver of
fees 2.06% 2.53%(c) 3.27% 6.02%(c)
Net investment income
including
reimbursement/waiver of
fees (0.40)% (0.73)%(c) (1.10)% (0.77)%(c)
Portfolio Turnover Rate 725% 173% 341% 166%
</TABLE>
--------------
(a) Effective October 31, 1999, the Fund changed its fiscal year end from
May 31 to October 31.
(b) Total returns would have been lower had certain Fund expenses not been
waived or reimbursed during the periods shown (See Note 3). Total return
calculations for a period of less than one year are not annualized.
(c) Annualized.
(d) The Fund commenced operations on October 15, 1997.
The accompanying notes are an integral part of the financial statements.
--------------------------------------------------------------------------------
55
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--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2000
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 separate investment portfolios, six of which are
included in this report: Schroder International Fund, Schroder Emerging
Markets Fund, Schroder International Smaller Companies Fund, Schroder U.S.
Large Cap Equity Fund, Schroder U.S. Smaller Companies Fund and Schroder Micro
Cap Fund (collectively, the "Funds"). As of October 31, 2000, each Fund had
Investor Shares outstanding.
As of June 23, 2000, the Advisor Shares of Schroder U.S. Smaller Companies
Fund were recapitalized into Investor Shares, such that the Fund no longer has
any Advisor Shares outstanding. As of September 14, 2000, Schroder U.S.
Diversified Growth Fund changed its name to Schroder U.S. Large Cap Equity
Fund.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America 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 income 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 accounting principles generally
accepted in the United States of America.
VALUATION OF INVESTMENTS
Portfolio securities listed on recognized stock exchanges are valued at
the last reported sale 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. Prices used for
valuations generally are provided by independent pricing services. 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. 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 Trust's Board of
Trustees ("Trustees").
REPURCHASE AGREEMENTS
When entering into repurchase agreements, it is each Fund's policy (other
than Schroder U.S. Large Cap Equity Fund which is prohibited from investing in
repurchase agreements) 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.
--------------------------------------------------------------------------------
56
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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. Capital gain taxes on securities in certain foreign countries
are accrued on realized gains and unrealized appreciation.
INVESTMENT INCOME
Dividend income is recorded on the ex-dividend date except that certain
foreign dividends are recorded as the Funds are 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"), investment adviser to the Trust, or the Trustees.
DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders from net investment income and net realized
capital gains, if any, are declared and distributed at least annually.
Distributions are recorded on the ex-dividend date.
With respect to each Fund that offered two classes of shares during the
periods shown, investment income, common expenses of a Fund and gains/losses
on investments were allocated to both classes of the Fund based on the
respective daily net asets of each class. Shareholder servicing fees related
to Advisor Shares were charged directly to that class. Neither class had
preferential dividend rights. Dividends, if any, paid by a Fund on its two
classes of shares normally differed in amounts due to the differing expenses
borne by each class.
DEFERRED ORGANIZATION COSTS
Costs incurred by the Funds in connection with their organizations are
amortized on a straight-line basis over a five-year period.
FEDERAL INCOME TAXES
It is the policy of the Trust for each 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 Funds will
not be subject to federal income taxes to the extent that, among other things,
they distribute substantially all of their taxable income, including capital
gains, for the fiscal year. In addition, as a result of distributing
substantially all of their net investment income during each calendar year,
capital gains and certain other amounts, if any, the Funds will not be subject
to a federal excise tax.
--------------------------------------------------------------------------------
57
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Schroder U.S. Smaller Companies Fund for its tax year end of May 31, 2000
utilized $5,190,650 of capital loss carryforward. As of October 31, 2000, the
Fund listed below had net tax basis capital loss carryforwards, for federal
income tax purposes, that may be applied against future taxable gains until
their expiration date as follows:
<TABLE>
<CAPTION>
FUND AMOUNT EXPIRATION DATE
---- ---------- ----------------
<S> <C> <C>
Schroder Emerging Markets Fund $2,912,589 October 31, 2008
</TABLE>
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from accounting principles generally
accepted in the United States of America. These differences are primarily due
to differing treatments for losses deferred due to wash sales, net operating
losses, passive foreign investment companies, tax treatment of foreign
currency and excise tax regulations.
At October 31, 2000, the Trust reclassified the following amounts between
capital paid in, undistributed net investment income and accumulated net
realized gain/loss:
<TABLE>
<CAPTION>
INCREASE
INCREASE (DECREASE)
INCREASE UNDISTRIBUTED ACCUMULATED
(DECREASE) NET INVESTMENT REALIZED
CAPITAL PAID IN INCOME GAIN (LOSS)
--------------- -------------- -----------
<S> <C> <C> <C>
Schroder International Fund $ 2,115,877 $390,158 $(2,506,035)
Schroder Emerging Markets Fund 54,546 141,268 (195,814)
Schroder International Smaller
Companies Fund -- 57,965 (57,965)
Schroder U.S. Large Cap Equity Fund (666,543) 154,489 512,054
Schroder U.S. Smaller Companies
Fund (1,043,424) 406,995 636,429
Schroder Micro Cap Fund -- 198,550 (198,550)
</TABLE>
These reclassifications had no impact on the net asset value of the Funds
and are designed to present each Fund's capital account on a tax basis.
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.
Certain Funds 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 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 Funds entering into offsetting commitments.
--------------------------------------------------------------------------------
58
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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
following annual rates based on average daily net assets of each Fund taken
separately: 0.50% up to $100 million, 0.40% of the next $150 million, and
0.35% in excess of $250 million for the Schroder International Fund; 1.00% for
the Schroder Emerging Markets Fund; 0.85% for the Schroder International
Smaller Companies Fund; 0.75% of the first $100 million, and 0.50% in excess
of $100 million for the Schroder U.S. Large Cap Equity Fund; 0.50% up to $100
million, 0.40% of the next $150 million, and 0.35% in excess of $250 million
for the Schroder U.S. Smaller Companies Fund; and 1.25% for the Schroder Micro
Cap Fund. SIMNA was contractually obligated, in any event, to waive the
investment advisory fees paid to it by Schroder U.S. Large Cap Equity Fund by
0.10% through September 11, 2000. SIMNA has contractually agreed to limit the
advisory fees paid to it by Schroder U.S. Large Cap Equity Fund to 0.50%
through October 31, 2001. In addition, SIMNA is contractually obligated
through October 31, 2001 to waive 0.10% of the advisory fees payable by
Schroder International Smaller Companies Fund. SIMNA has contractually agreed
to limit the investment advisory fees payable to it by Schroder International
Fund through October 31, 2001 to the annual rate of 0.45% 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: 0.225% of the average daily net assets of the Schroder International Fund;
and 0.25% of the average daily net assets of the Schroder Emerging Markets
Fund, Schroder International Smaller Companies Fund, Schroder U.S. Smaller
Companies Fund and Schroder Micro Cap 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 Trust, 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.
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 expenses of the Trust) until October 31, 2001, to the extent that
each Fund's total operating expenses attributable to its Investor Shares
exceed the following annual rates (based on average net assets of each Fund's
Investor Shares taken separately): Schroder International Fund: 0.99%;
Schroder Emerging Markets Fund: 1.70%; Schroder International Smaller
Companies Fund: 1.50%; Schroder U.S. Large Cap Equity Fund: 1.50%; Schroder
U.S. Smaller Companies Fund: 1.49% and Schroder Micro Cap Fund: 2.00%.
SIMNA and Schroder Advisors were contractually obligated to reduce their
compensation (and, if necessary, to pay certain expenses of the Trust) to the
extent that each Fund's total operating expenses attributable to its Advisor
Shares exceed the following annual rates: Schroder International Fund: 1.24%;
Schroder Emerging Markets Fund: 1.95%; Schroder International Smaller
Companies Fund: 1.75%; Schroder U.S. Large Cap Equity Fund: 1.75% and Schroder
U.S. Smaller Companies Fund: 1.74%.
NOTE 4. SHAREHOLDER SERVICING PLAN
The Trust adopted a Shareholder Servicing Plan (the "Plan"), for Advisor
Shares under which Schroder Advisors, or other shareholder servicing
organizations, provided administrative support services to shareholders of a
Fund's Advisor Shares. For providing for, or arranging for the provision of,
these shareholder services,
--------------------------------------------------------------------------------
59
<PAGE>
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SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Schroder Advisors was entitled to receive compensation monthly at an annual
rate of up to 0.25% of the average net assets of a Fund attributable to its
Advisor Shares. As a result of the recapitalization and discontinuation of the
Advisor Shares, the Shareholder Servicing Plan is no longer in use for any of
the Funds.
NOTE 5. 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 Advisors, with the
exception of Schroder Series Trust II, trustees who are not interested persons
of the Trust, SIMNA or Schroder Advisors 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 Funds 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. Payment
of meeting fees will be allocated only among those Funds to which the meeting
relates.
NOTE 6. INVESTMENT TRANSACTIONS
Purchases and proceeds from sales of investments, excluding short-term
securities for each Fund and securities received from any mergers, for the
year ended October 31, 2000 were as follows:
<TABLE>
<CAPTION>
NON- NON-
GOVERNMENT GOVERNMENT
PURCHASES SALES
------------ ------------
<S> <C> <C>
Schroder International Fund............. $153,270,434 $228,558,204
Schroder Emerging Markets Fund.......... 79,629,154 45,340,410
Schroder International Smaller Companies
Fund.................................. 18,184,719 12,773,284
Schroder U.S. Large Cap Equity Fund..... 38,990,538 38,243,128
Schroder U.S. Smaller Companies Fund.... 88,025,666 95,757,380
Schroder Micro Cap Fund................. 294,533,842 290,118,170
</TABLE>
At October 31, 2000, the identified cost for federal income tax purposes
of investments owned by each Fund and their respective gross unrealized
appreciation and depreciation were as follows:
<TABLE>
<CAPTION>
GROSS UNREALIZED NET UNREALIZED
---------------------------- APPRECIATION/
IDENTIFIED COST APPRECIATION (DEPRECIATION) (DEPRECIATION)
--------------- ------------ -------------- --------------
<S> <C> <C> <C> <C>
Schroder International Fund... $106,181,116 $ 5,351,600 $(7,577,396) $(2,225,796)
Schroder Emerging Markets
Fund........................ 35,864,110 1,277,949 (6,569,062) (5,291,113)
Schroder International Smaller
Companies Fund.............. 17,992,769 2,990,533 (2,682,566) 307,967
Schroder U.S. Large Cap Equity
Fund........................ 43,815,405 6,770,660 (2,406,215) 4,364,445
Schroder U.S. Smaller
Companies Fund.............. 51,923,473 13,555,762 (2,840,015) 10,715,747
Schroder Micro Cap Fund....... 77,290,244 7,995,387 (1,349,926) 6,645,461
</TABLE>
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60
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 7. PORTFOLIO INVESTMENT RISKS
Schroder International Smaller Companies Fund has a relatively large
number of portfolio securities invested in companies domiciled in the United
Kingdom, France, Germany and Japan. The Fund may be more susceptible to
political, social and economic events adversely affecting those countries than
securities not so invested.
Schroder Emerging Markets Fund may invest more than 25% of its total
assets in issuers located in any one country. To the extent that it does so,
the Fund is susceptible to a range of factors that could adversely affect that
country, including political and economic developments and foreign
exchange-rate fluctuations. As a result of investing substantially in a single
country, the value of the Fund's assets may fluctuate more widely than the
value of shares of a comparable fund with a lesser degree of geographic
concentration. The Fund invests in countries with limited or developing
capital markets. Investments in these markets may involve greater risk than
investments in more developed markets.
Option contracts involve the risk that they may not work as intended due
to unanticipated developments in market conditions or other causes. Options
also involve the risk that the other party to the transaction will be unable
to meet its obligation or that the Funds will be unable to close out the
position at any particular time or at an acceptable price.
NOTE 8. BENEFICIAL INTEREST
The following table shows the number of shareholders each owning
beneficially or of record 5% or more of shares of a Fund outstanding as of
October 31, 2000 and the total percentage of shares of the Fund held by such
shareholders.
<TABLE>
<CAPTION>
5% OR GREATER
SHAREHOLDERS
----------------------
NUMBER % OF FUND HELD
------ --------------
<S> <C> <C>
Schroder International Fund............. 4 66%
Schroder Emerging Markets Fund.......... 5 96%
Schroder International Smaller Companies
Fund.................................. 3 84%
Schroder U.S. Large Cap Equity Fund..... 3 51%
Schroder U.S. Smaller Companies Fund.... 4 83%
Schroder Micro Cap Fund................. 5 65%
</TABLE>
NOTE 9. LINE OF CREDIT
The Trust and other Schroder Funds managed by SIMNA (the "Participants"),
share in a $37.5 million unsecured revolving credit facility with State Street
for temporary or emergency purposes, including the meeting of redemption
requests that otherwise might require the untimely disposition of securities.
The Participants are charged an annual commitment fee of 0.08%, which is
allocated, pro rata based upon net assets, among each of the Participants.
Interest is calculated based on the federal funds rate plus 0.50% at the time
of the borrowing. To the extent permitted by a Fund's investment policies and
to the extent amounts remain available for borrowing under the facility, each
Fund may borrow up to a maximum of 33 percent of its respective net assets
under the agreement. For the year ended October 31, 2000, the Funds had no
borrowings against the line of credit.
--------------------------------------------------------------------------------
61
<PAGE>
--------------------------------------------------------------------------------
SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 10. MERGER
As of the close of business on September 11, 2000, Schroder U.S.
Diversifed Growth Fund acquired all the net assets of Schroder Large
Capitalization Fund, a series of Schroder Series Trust, pursuant to a plan of
reorganization approved by the shareholders of Schroder Large Capitalization
Fund on September 8, 2000. The merged fund is now named Schroder U.S. Large
Cap Equity Fund. The acquisition was completed by a tax-free exchange, the
details of which are outlined in the following schedule:
<TABLE>
<CAPTION>
AT CLOSE OF BUSINESS SEPTEMBER 11, 2000
----------------------------------------------------------------------
LARGE CAPITALIZATION EQUITY FUND US DIVERSIFIED GROWTH MERGED ASSETS
-------------------------------- --------------------- -------------
<S> <C> <C> <C>
Net Assets......................... $37,300,982 $15,239,808 $52,540,790
Unrealized Appreciation............ $ 4,796,338 $ 1,078,258 $ 5,876,596
Shares Outstanding................. 3,274,659 2,949,839 10,169,872
Net Asset Value Per Share.......... $ 11.39 $ 5.17 $ 5.17
</TABLE>
------------------------------------------------------------------------------
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and Shareholders of Schroder Capital Funds (Delaware):
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of the Schroder
Capital Funds (Delaware) (consisting of Schroder International Fund, Schroder
Emerging Markets Fund, Schroder International Smaller Companies Fund, Schroder
U.S. Large Cap Equity Fund (formerly Schroder U.S. Diversified Growth Fund),
Schroder U.S. Smaller Companies Fund and Schroder Micro Cap Fund)
(collectively the "Funds") at October 31, 2000, the results of each of their
operations, the changes in each of their net assets and the financial
highlights for the periods indicated therein, in conformity with accounting
principles generally accepted in the United States of America. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Funds' management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in
accordance with auditing standards generally accepted in the United States of
America, which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities at October 31, 2000 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
December 15, 2000
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62
<PAGE>
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SCHRODER CAPITAL FUNDS
--------------------------------------------------------------------------------
TAX INFORMATION NOTICE (UNAUDITED)
For federal income tax purposes, the following information is furnished with
respect to the distributions of the Trust for its fiscal year ended October 31,
2000:
The Funds listed below designated the following amounts as long term capital
gain dividends:
<TABLE>
<CAPTION>
CAPITAL GAIN DIVIDENDS
LONG TERM
----------------------
<S> <C>
Schroder International Fund....................... $9,019,111
Schroder Emerging Markets Fund.................... 64,974
Schroder International Smaller Companies Fund..... 2,538
Schroder U.S. Large Cap Equity Fund............... 1,620,474
</TABLE>
The Funds listed below have designated the following amounts as foreign tax
credits for federal income tax purposes:
<TABLE>
<S> <C>
Schroder International Fund....................... $239,075
Schroder International Smaller Companies Fund..... 22,472
</TABLE>
These credits will affect only those shareholders of the Funds who are
holders on the dividend record date in December 2000. Accordingly, shareholders
will receive more detailed information along with their Form 1099-DIV in January
2001.
On December 18, 2000, the Funds made the following per share distribution to
shareholders of record December 15, 2000:
<TABLE>
<CAPTION>
NET
INVESTMENT SHORT TERM LONG TERM
INCOME CAPITAL GAIN CAPITAL GAIN
---------- ------------ ------------
<S> <C> <C> <C>
Schroder International Fund........ $0.307933 $ 1.24072 $5.63710
Schroder International Smaller
Companies Fund................... 0.092924 1.08477 1.52952
Schroder U.S. Smaller Companies
Fund............................. -- 22.98281 0.15035
Schroder Micro Cap Fund............ -- 1.82578 1.47389
</TABLE>
--------------------------------------------------------------------------------
63
<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
Schroders 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
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.
Schroder Capital Funds
P.O. Box 8507
Boston, MA 02266
800-464-3108
[SCHRODER LOGO]
------------------------------------------
SCHRODER CAPITAL
FUNDS
Schroder International Fund
Schroder Emerging Markets Fund
Schroder International Smaller Companies Fund
Schroder U.S. Large Cap Equity Fund
Schroder U.S. Smaller Companies Fund
Schroder Micro Cap Fund
ANNUAL REPORT
October 31, 2000
SF1200AR
