<PAGE>
[LOGO] Phoenix Investment Partners
SEPTEMBER 30, 1999
-SENECA-
Annual Report
Phoenix-Seneca
Bond Fund
Phoenix-Seneca
Growth Fund
Phoenix-Seneca
Mid-Cap "EDGE" -SM- Fund
Phoenix-Seneca
Real Estate Securities Fund
PHOENIX
INVESTMENT PARTNERS
[LOGO]
<PAGE>
PRESIDENT'S MESSAGE
THE Y2K FACTOR
[PHOTO]
Analysis, testing and remediation of critical computer systems throughout 1998
and 1999 appear to have been extremely thorough for large companies, and, in
particular, for the financial services industry. We will undoubtedly encounter
some glitches, but major systems for securities settlement, portfolio
accounting, and bank operations appear sound. Even governmental bureaucracies
have made huge strides toward full readiness. Outside the U.S., significant
difficulties may occur in less- developed nations, but the volume of financial
transactions there is too small to pose a systemic structural threat to world
financial systems.
More likely than major computer operating failures are "accidents" caused by
non-systemic, all-too-human attempts to cope with uncertainty. Inventory
stockpiling, cash hoarding, and delivery problems are among the obvious
potential problems. All of these will be short-lived, given the inherent
ingenuity of the U.S. entrepreneurial system and the lubricant of extra cash the
Fed has promised to inject into the system.
The Federal Reserve's plan to inject $200 billion in liquidity into the
banking system in preparation for any year-end distortions could provide a real
boon to the markets. So, too, may "flight to safety" inflows to the U.S., which
clearly leads the world in Y2K readiness. And, we believe the sheer relief when
the dreaded turn of the year is behind us will almost certainly improve market
sentiment.
On the following pages, your portfolio managers discuss factors that affected
your fund's performance over the last fiscal year and share their outlook for
the short term. We hope you find their comments helpful and informative. If you
have any questions, please call your financial advisor or contact us at
www.phoenixinvestments.com or 1-800-243-1574.
/s/ Gail P. Seneca
Gail P. Seneca
OCTOBER 7, 1999
1
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
Phoenix-Seneca Bond Fund.................................... 3
Phoenix-Seneca Growth Fund.................................. 14
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund...................... 23
Phoenix-Seneca Real Estate Securities Fund.................. 32
Notes to Financial Statements............................... 41
</TABLE>
2
<PAGE>
PHOENIX-SENECA BOND FUND
A DISCUSSION WITH THE FUND'S PORTFOLIO MANAGERS, GAIL P. SENECA, PH.D.,
AND CHARLES DICKE, CFA
Q: WHAT IS THE INVESTMENT OBJECTIVE OF THE FUND?
A: The Phoenix-Seneca Bond Fund seeks high total return through both current
income and capital appreciation. Its value-driven process focuses on issue
selection, sector selection, measured interest rate anticipation, and trading
opportunities. It is suitable for investors looking for a fund that seeks a
balance between enhancing portfolio returns over market cycles and minimizing
risk and volatility.
Q: HOW DID THE FUND PERFORM OVER THE LAST 12-MONTH REPORTING PERIOD?
A: For the 12 months ended September 30, 1999, Class A shares returned 2.46%,
Class B shares returned 1.67%, Class C shares returned 1.66%, and Class X shares
returned 3.51% compared with a loss of (0.37%) for the Lehman Brothers Aggregate
Bond Index(1). All performance figures assume reinvestment of distributions and
exclude the effect of sales charges.
Q: CAN YOU PROVIDE A BRIEF OVERVIEW OF THE MARKETS FOR THE LAST 12 MONTHS?
A: U.S. bond yields, which have been fairly volatile during the reporting
period, were particularly so during the third quarter of the year as market
expectations of Federal Reserve action gyrated from optimism to pessimism. The
yield on the 30-year U.S. Treasury reached a high of 6.28% on August 12, fell to
a low of 5.86% on August 25, and closed the quarter with a yield of 6.05%. For
the year, total returns on bonds, as measured by the broad market index, the
Lehman Brothers Aggregate Bond Index, are in negative territory, reflecting the
large rise in interest rate levels since 1998.
Corporate bond performance has been particularly weak as large supplies of
new issuance forced yields higher and prices lower. Limited liquidity due to Y2K
fears also hurt corporate issues. High-yield corporate bonds were especially
affected. However, our view remains positive on this sector. Market technicals,
the main driver behind the recent negative performance, should turn as we begin
the new year.
Q: WHAT IS YOUR OUTLOOK FOR THE NEAR TERM?
A: Rising rates have been the market's greatest enemy this year. The Fed is on
alert to inflation signals, and while it is true that inflation risks are higher
when labor is tight, it is also true that disinflationary forces remain very
strong. Unused manufacturing capacity is abundant worldwide. Technology
advances, particularly the Internet, are profoundly disinflationary. And, global
competition is driving price discounting in markets as diverse as
telecommunications and toys. Inflation may rebound moderately, but we doubt it
will gain traction in this intensely competitive environment.
With the good probability, in our opinion, that inflation will not increase
significantly, bonds today appear to be fairly valued. We believe that bonds
will provide much improved returns in the coming year.
OCTOBER 19, 1999
(1) THE LEHMAN BROTHERS AGGREGATE BOND INDEX IS AN UNMANAGED, COMMONLY USED
MEASURE OF BROAD BOND MARKET TOTAL RETURN PERFORMANCE.
THE INDEX IS NOT AVAILABLE FOR DIRECT INVESTMENT.
3
<PAGE>
Phoenix-Seneca Bond Fund
AVERAGE ANNUAL TOTAL RETURNS(1) PERIOD ENDING 9/30/99
<TABLE>
<CAPTION>
INCEPTION INCEPTION
1 YEAR TO 9/30/99 DATE
------- ---------- ---------
<S> <C> <C> <C>
Class X Shares at NAV(2) 3.51% 7.92% 3/7/96
Class A Shares at NAV(2) 2.46 2.40 7/1/98
Class A Shares at POP(3) (2.41) (1.51) 7/1/98
Class B Shares at NAV(2) 1.67 1.57 7/1/98
Class B Shares with CDSC(4) (2.18) (1.48) 7/1/98
Class C Shares at NAV(2) 1.66 1.56 7/1/98
Class C Shares with CDSC(4) 1.66 1.56 7/1/98
Lehman Brothers Aggregate Bond
Index(7) (0.37) Note 5 Note 5
</TABLE>
(1) Total returns are historical and include changes in share price and the
reinvestment of both dividends and capital gains distributions.
(2) "NAV" (Net Asset Value) total returns do not include the effect of any
sales charge.
(3) "POP" (Public Offering Price) total returns include the effect of the
maximum front-end 4.75% sales charge.
(4) CDSC (contingent deferred sales charge) is applied to redemptions of
certain classes of shares that do not have a sales charge applied at the
time of purchase. CDSC charges for B shares decline from 5% to 0% over a
five year period. CDSC charges for C shares are 1% in the first year and 0%
thereafter.
(5) Index performance is 6.14% for Class X (since 3/7/96) and 0.55% for Class
A, Class B and Class C (since 7/1/98).
(6) This chart illustrates NAV returns on Class X shares. Returns on Class A,
Class B and Class C shares will vary due to differing sales charges.
(7) The Lehman Brothers Aggregate Bond Index is an unmanaged, commonly used
measure of broad bond market total return performance. The index's
performance does not reflect sales charges.
All returns represent past performance which may not be indicative of
future performance. The investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
GROWTH OF $10,000 PERIODS ENDING 9/30
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PHOENIX-SENECA BOND LEHMAN BROTHERS AGGREGATE
FUND CLASS X AT NAV(6) BOND INDEX(7)
<S> <C> <C>
3/96 $10,000 $10,000
96 $10,413 $10,146
97 $11,586 $11,132
98 $12,679 $12,413
99 $13,124 $12,367
</TABLE>
This Growth of $10,000 chart assumes an initial investment of $10,000 made on
3/7/96 (inception of the Fund) in Class X shares and reflects no sales charge.
Performance assumes dividends and capital gains are reinvested. The performance
of other share classes will be greater or less than that shown based on
differences in inception dates, fees and sales charges.
SECTOR WEIGHTINGS 9/30/99
As a percentage of bond holdings
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Corporate 67%
Agency Mortgage-Backed 11
Non-Agency Mortgage-Backed 6
Foreign Corporate 6
Asset-Backed 4
U.S. Government 3
Agency Non Mortgage-Backed 3
</TABLE>
4
<PAGE>
Phoenix-Seneca Bond Fund
TEN LARGEST HOLDINGS AT SEPTEMBER 30, 1999 (AS A PERCENTAGE OF NET ASSETS)
<TABLE>
<C> <S> <C>
1. Sprint Spectrum L.P. 3.6%
CORPORATE BOND
2. Fannie Mae 7%, 10/15/29 2.9%
AGENCY MORTGAGE-BACKED SECURITY
3. GMAC Commercial Mortgage Securities, Inc. 2.8%
NON-AGENCY MORTGAGE-BACKED SECURITY
4. U.S. Government Securities 2.7%
U.S. TREASURY BONDS & NOTES
5. Fannie Mae 6.50%, 8/15/04 2.7%
AGENCY NON MORTGAGE-BACKED SECURITY
6. Freddie Mac 6%, 10/15/27 2.6%
AGENCY MORTGAGE-BACKED SECURITY
7. Olympic Automobile Receivables Trust 96-D, A5 2.5%
ASSET-BACKED SECURITY
8. Fannie Mae 6.50%, 8/1/29 2.4%
AGENCY MORTGAGE-BACKED SECURITY
9. Microsoft Corp. Series A Cv. Pfd. 2.4%
CONVERTIBLE PREFERRED STOCK
10. Fox/Liberty Networks LLC 2.3%
CORPORATE BOND
</TABLE>
INVESTMENTS AT SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES--2.7%
U.S. TREASURY BONDS--1.1%
U.S. Treasury Bonds 5.25%, 11/15/28..... Aaa $ 510 $ 441,633
U.S. TREASURY NOTES--1.6%
U.S. Treasury Notes 4.75%, 2/15/04...... Aaa 450 431,438
U.S. Treasury Notes 6.50%, 10/15/06..... Aaa 200 204,505
-----------
635,943
-----------
- --------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT SECURITIES
(IDENTIFIED COST $1,087,835) 1,077,576
- --------------------------------------------------------------------------
AGENCY MORTGAGE-BACKED SECURITIES--10.8%
Fannie Mae 8.75%, 5/25/17............... Aaa 12 12,443
Fannie Mae 6.50%, 12/1/28............... Aaa 384 367,908
Fannie Mae 6.50%, 8/1/29................ Aaa 1,009 967,022
Fannie Mae W.I. 7%, 10/15/29............ Aaa 1,150 1,129,875
Fannie Mae Strip I.O. 3.156%,
10/25/23(c)............................. Aaa 222 5,896
Freddie Mac 8.75%, 12/15/20............. Aaa 5 5,509
Freddie Mac 7%, 7/15/23................. Aaa 769 731,790
Freddie Mac 6%, 10/15/27................ Aaa 1,125 1,045,102
GNMA 7%, 2/15/26........................ Aaa 16 16,197
- --------------------------------------------------------------------------
TOTAL AGENCY MORTGAGE-BACKED SECURITIES
(IDENTIFIED COST $4,338,864) 4,281,742
- --------------------------------------------------------------------------
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
AGENCY NON MORTGAGE-BACKED
SECURITIES--2.7%
Fannie Mae 6.50%, 8/15/04............... Aaa $1,050 $ 1,055,104
- --------------------------------------------------------------------------
TOTAL AGENCY NON MORTGAGE-BACKED SECURITIES
(IDENTIFIED COST $1,059,912) 1,055,104
- --------------------------------------------------------------------------
ASSET-BACKED SECURITIES--3.8%
Olympic Automobile Receivables Trust
96-B, CTFS 6.90%, 2/15/04............... Aaa 76 76,847
Olympic Automobile Receivables Trust
96-C, A5 7%, 3/15/04.................... Aaa 400 403,955
Olympic Automobile Receivables Trust
96-D, A5 6.25%, 11/15/04(e)............. Aaa 1,000 1,000,195
Standard Credit Card Master Trust 1
93-2, A 5.95%, 9/7/03................... Aaa 40 39,066
- --------------------------------------------------------------------------
TOTAL ASSET-BACKED SECURITIES
(IDENTIFIED COST $1,523,019) 1,520,063
- --------------------------------------------------------------------------
CORPORATE BONDS--64.8%
AIR FREIGHT--1.2%
Federal Express Corp. Series 98-1A
6.72%, 1/15/22.......................... Aa 499 467,031
</TABLE>
See Notes to Financial Statements 5
<PAGE>
Phoenix-Seneca Bond Fund
<TABLE>
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
AIRLINES--2.5%
Alaska Airlines, Inc. Series A 9.50%,
4/12/10................................. Baa $ 114 $ 120,779
Alaska Airlines, Inc. Series D 9.50%,
4/12/12................................. Baa 452 482,945
Delta Air Lines, Inc. Series B2 10.06%,
1/2/16.................................. Baa 65 73,976
United Airlines, Inc. Series 91-B
10.11%, 2/19/06......................... Baa 18 19,239
United Airlines, Inc. Series 91-E 9.76%,
5/27/06................................. Baa 86 92,181
United Airlines, Inc. Series 95-A1
9.02%, 4/19/12.......................... Baa 181 189,344
-----------
978,464
-----------
BANKS (MAJOR REGIONAL)--2.4%
First Republic Bancorp 7.75%, 9/15/12... BB(d) 300 269,262
Wells Fargo Capital I 7.96%, 12/15/26... Aa 700 681,534
-----------
950,796
-----------
BANKS (MONEY CENTER)--1.0%
BankAmerica Corp. Institutional Series A
144A 8.07%, 12/31/26(b)................. Aa 400 392,072
BROADCASTING (TELEVISION, RADIO & CABLE)--5.5%
Chancellor Media Corp. 9.375%,
10/1/04................................. B 75 76,875
Falcon Holding Group L.P. 8.375%,
4/15/10................................. B 500 495,000
Fox/Liberty Networks LLC 0%,
8/15/07(c).............................. Ba 1,180 929,250
Jacor Communications, Inc. 10.125%,
6/15/06................................. B 100 107,500
Jones Intercable, Inc. 9.625%,
3/15/02................................. Baa 300 316,500
SFX Broadcasting Corp. Series B 10.75%,
5/15/06................................. B 56 61,180
Turner Broadcasting System, Inc. 8.40%,
2/1/24.................................. Baa 200 201,987
-----------
2,188,292
-----------
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
CONSUMER (JEWELRY, NOVELTIES & GIFTS)--0.1%
Finlay Fine Jewelry Corp. 8.375%,
5/1/08.................................. Ba $ 40 $ 38,650
ELECTRONICS (SEMICONDUCTORS)--1.9%
SCG Holdings & Semiconductor Co. 144A
12%, 8/1/09(b).......................... B 750 768,750
ENTERTAINMENT--2.8%
AMC Entertainment, Inc. 9.50%,
3/15/09................................. B 100 83,500
Royal Caribbean Cruises Ltd. 7.50%,
10/15/27................................ Baa 100 90,527
Time Warner, Inc. 9.125%, 1/15/13....... Baa 65 73,448
Time Warner, Inc. 6.85%, 1/15/26........ Baa 620 623,100
United Artists Theatre Circuit, Inc.
Series 95-A 9.30%, 7/1/15............... B 327 222,211
-----------
1,092,786
-----------
FINANCIAL (DIVERSIFIED)--1.3%
Countrywide Capital I 8%, 12/15/26...... A 200 185,028
Dollar Financial Group, Inc. Series A
10.875%, 11/15/06....................... B 75 74,625
Market Hub Partners Finance, Inc. 8.25%,
3/1/08.................................. Ba 250 243,125
-----------
502,778
-----------
HEALTH CARE (HOSPITAL MANAGEMENT)--1.0%
Universal Health Services, Inc. 8.75%,
8/15/05................................. Ba 400 414,048
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)--0.7%
Dade International, Inc. Series B
11.125%, 5/1/06......................... B 260 275,600
HEALTH CARE (SPECIALIZED SERVICES)--1.2%
HEALTHSOUTH Corp. 9.50%, 4/1/01(e)...... Ba 500 484,881
HOMEBUILDING--2.8%
Lennar Corp. 7.625%, 3/1/09............. Ba 800 740,000
Toll Corp. 8%, 5/1/09................... Ba 400 381,500
-----------
1,121,500
-----------
</TABLE>
6 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Bond Fund
<TABLE>
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
INVESTMENT BANKING/BROKERAGE--2.1%
Donaldson, Lufkin & Jenrette, Inc.
6.875%, 11/1/05......................... A $ 50 $ 48,958
Donaldson, Lufkin & Jenrette, Inc.
6.50%, 6/1/08........................... A 200 187,278
Lehman Brothers Holdings, Inc. Series F
7%, 5/15/03............................. A 500 497,500
Lehman Brothers Holdings, Inc. 8.80%,
3/1/15.................................. A 80 83,417
-----------
817,153
-----------
LODGING-HOTELS--1.4%
Hammons (John Q.) Hotels, Inc. 8.875%,
2/15/04................................. B 530 479,650
Hammons (John Q.) Hotels, Inc. 9.75%,
10/1/05................................. B 100 92,000
-----------
571,650
-----------
MACHINERY (DIVERSIFIED)--1.3%
Better Minerals & Aggregates 144A 13%,
9/15/09(b).............................. B 500 501,250
MANUFACTURING (DIVERSIFIED)--0.0%
Hawk Corp. 10.25%, 12/1/03.............. Ba 10 10,150
MANUFACTURING (SPECIALIZED)--1.3%
Advanced Glassfiber Yarns 9.875%,
1/15/09................................. B 300 275,250
BGF Industries, Inc. Series B 10.25%,
1/15/09................................. B 300 258,750
-----------
534,000
-----------
OFFICE EQUIPMENT & SUPPLIES--1.9%
CEX Holdings, Inc. Series B 9.625%,
6/1/08.................................. B 700 752,500
OIL & GAS (REFINING & MARKETING)--0.8%
El Paso Tenneco RACERS 97-C-1-2 144A
9.14%, 12/31/01(b)...................... NR 300 316,500
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
PAPER & FOREST PRODUCTS--0.1%
Container Corporation of America Series
A 11.25%, 5/1/04........................ B $ 40 $ 41,400
PHOTOGRAPHY/IMAGING--0.4%
Imax Corp. 7.875%, 12/1/05.............. Ba 150 139,875
PUBLISHING (NEWSPAPERS)--0.8%
Garden State Newspapers, Inc. Series B
8.75%, 10/1/09.......................... B 325 299,000
RAILROADS--1.5%
Railworks Corp. 11.5%, 4/15/09.......... B 600 600,000
REITS--4.5%
ERP Operating L.P. 7.57%, 8/15/26....... A 170 166,495
Evans Withycomb Residential, Inc. 7.50%,
4/15/04................................. A 100 101,496
First Industrial L.P. 7.15%, 5/15/27.... Baa 500 494,309
Property Trust of America 6.875%,
2/15/08................................. Baa 5 4,779
Regency Centers L.P. 7.4%, 4/1/04....... Baa 500 488,750
Security Capital Pacific Trust 7.375%,
10/15/06................................ Baa 100 94,552
Security Capital Pacific Trust 7.90%,
2/15/16................................. Baa 200 185,760
Washington Real Estate Investment Trust
7.125%, 8/13/03......................... Baa 110 109,252
Weingarten Realty Investors Series A
6.88%, 6/25/27.......................... A 150 144,050
-----------
1,789,443
-----------
RESTAURANTS--1.5%
CKE Restaurants, Inc. 4.25%, 3/15/04.... B 500 325,000
Foodmaker, Inc. Series B 9.75%,
11/1/03................................. BB(d) 250 255,625
-----------
580,625
-----------
RETAIL (DISCOUNTERS)--0.9%
AMES Department Stores 10%, 4/15/06..... B 350 340,375
</TABLE>
See Notes to Financial Statements 7
<PAGE>
Phoenix-Seneca Bond Fund
<TABLE>
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
RETAIL (FOOD CHAINS)--2.9%
Kroger Co. 6%, 7/1/00(c)................ Baa $ 275 $ 274,422
Meyer (Fred), Inc. Series 94-A2 8.64%,
7/2/12.................................. BBB(d) 100 105,500
Stater Brothers Holdings, Inc. 144A
10.75%, 08/15/06(b)..................... B 750 767,812
-----------
1,147,734
-----------
RETAIL (GENERAL MERCHANDISE)--3.3%
K Mart Funding Corp. Series F 8.80%,
7/1/10.................................. Ba 500 487,604
Wal-Mart Stores, Inc. Series A-2 8.85%,
1/2/15.................................. Aa 750 838,500
-----------
1,326,104
-----------
SERVICES (ADVERTISING/MARKETING)--0.9%
Outdoor Systems, Inc. 8.875%, 6/15/07... B 350 357,875
SERVICES (COMMERCIAL & CONSUMER)--5.6%
Coinmach Laundry Corp. Series D 11.75%,
11/15/05................................ B 255 274,762
Group Maintenance America Corp. 9.75%,
1/15/09................................. B 300 288,000
Loomis Fargo & Co. 10%, 1/15/04......... B 300 297,000
Protection One Alarm Monitoring, Inc.
7.375%, 8/15/05......................... Ba 500 392,500
SC International Services, Inc. 9.25%,
9/1/07.................................. B 190 187,625
United Rentals, Inc. Series B 9.50%,
6/1/08.................................. B 250 247,500
United Rentals, Inc. Series B 8.80%,
8/15/08................................. B 500 475,000
Williams Scotsman, Inc. 9.875%,
6/1/07.................................. B 50 47,625
-----------
2,210,012
-----------
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--3.7%
Orion Network Systems 0%, 1/15/07(c).... B $ 90 $ 41,850
Sprint Spectrum L.P. 0%, 8/15/06(c)..... Baa 1,530 1,415,250
-----------
1,457,100
-----------
TELECOMMUNICATIONS (LONG DISTANCE)--0.5%
Qwest Communications International Corp.
0%, 10/15/07(c)......................... Ba 275 213,469
TEXTILES (APPAREL)--2.2%
Levi Strauss & Co. 144A 7%,
11/1/06(b).............................. Ba 1,000 861,250
WASTE MANAGEMENT--1.8%
Waste Management, Inc. 6.125%,
7/15/01(c)(e)........................... Ba 750 719,435
WATER UTILITIES--1.0%
Marlin Water Trust 144A 7.09%,
12/15/01(b)............................. Baa 405 400,950
- --------------------------------------------------------------------------
TOTAL CORPORATE BONDS
(IDENTIFIED COST $26,637,442) 25,663,498
- --------------------------------------------------------------------------
NON-AGENCY MORTGAGE-BACKED
SECURITIES--6.5%
DLJ Commercial Mortgage Corp. 98-CG1,
A1A 6.11%, 12/10/07..................... AAA(d) 924 894,405
GE Capital Mortgage Services, Inc.
94-21, B1 6.50% 8/25/09................. A 29 28,531
GMAC Commercial Mortgage Securities,
Inc. 98-C2, A2 6.42%, 8/15/08........... Aaa 1,178 1,116,367
Lehman ABS Corp. 94-C2, A 144A 8.145%,
11/2/07(b).............................. BBB(d) 70 68,450
Morgan Stanley Capital I, 98-WF1, A2
6.55%, 12/15/07(c)...................... NR 485 466,572
- --------------------------------------------------------------------------
TOTAL NON-AGENCY MORTGAGE-BACKED SECURITIES
(IDENTIFIED COST $2,601,623) 2,574,325
- --------------------------------------------------------------------------
</TABLE>
8 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Bond Fund
<TABLE>
<CAPTION>
MOODY'S PAR
RATING VALUE
(Unaudited) (000) VALUE
----------- ------ -----------
<S> <C> <C> <C>
FOREIGN CORPORATE BONDS--5.6%
FRANCE--1.5%
Societe General Real Estate LLC Series A
144A 7.64%, 12/29/49(b)(c).............. A $ 650 $ 600,927
MEXICO--2.4%
Pemex Finance Ltd. 144A 6.30%,
5/15/10(b).............................. Aaa 500 475,000
Pemex Finance Ltd. 144A 9.15%,
11/15/18(b)............................. Baa 500 468,750
-----------
943,750
-----------
UNITED KINGDOM--1.7%
Abbey National PLC 7.35%, 10/29/49(c)... Aa 100 95,711
Credit Suisse Group 144A 7.90%,
5/29/49(b)(c)........................... A 350 333,375
Terra Nova (U.K.) Holdings 7.20%,
8/15/07................................. Baa 250 240,100
-----------
669,186
-----------
- --------------------------------------------------------------------------
TOTAL FOREIGN CORPORATE BONDS
(IDENTIFIED COST $2,373,514) 2,213,863
- --------------------------------------------------------------------------
<CAPTION>
SHARES
------
PREFERRED STOCKS--0.7%
<S> <C> <C> <C>
BANKS (MAJOR REGIONAL)--0.7%
First Republic Bank Series A 144A
10.50%(b)............................... 300 296,250
- --------------------------------------------------------------------------
TOTAL PREFERRED STOCKS
(IDENTIFIED COST $300,000) 296,250
- --------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCKS--2.7%
COMPUTERS (SOFTWARE & SERVICES)--2.3%
Microsoft Corp. Series A Cv. Pfd.
2.75%................................... 9,250 931,359
<CAPTION>
SHARES VALUE
------ -----------
<S> <C> <C> <C>
REITS--0.2%
Equity Office Properties Trust Series B
Cv. Pfd. 144A 5.25%(b).................. 2,000 $ 77,750
SERVICES (COMMERCIAL & CONSUMER)--0.2%
United Rentals, Inc. Cv. Pfd. 144A
6.50%(b)................................ 2,000 72,750
- --------------------------------------------------------------------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(IDENTIFIED COST $1,030,000) 1,081,859
- --------------------------------------------------------------------------
TOTAL LONG-TERM INVESTMENTS--100.3%
(IDENTIFIED COST $40,952,209) 39,764,280
- --------------------------------------------------------------------------
<CAPTION>
PAR
VALUE
(000)
------
SHORT-TERM OBLIGATIONS--4.7%
<S> <C> <C> <C>
FEDERAL AGENCY SECURITIES--4.3%
FMC 5.20%, 10/1/99...................... $1,700 1,700,000
REPURCHASE AGREEMENT--0.4%
State Street Bank & Trust Co. repurchase
agreement 4.25% dated 9/30/99 due
10/1/99, repurchase price $158,019
collateralized by U.S. Treasury Bond
7.875%, 11/15/07, market value
$162,469................................ 158 158,000
- --------------------------------------------------------------------------
TOTAL SHORT-TERM OBLIGATIONS
(IDENTIFIED COST $1,858,000) 1,858,000
- --------------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL INVESTMENTS--105.0%
(IDENTIFIED COST $42,810,209) 41,622,280(a)
Cash and receivables, less liabilities--(5.0%) (2,000,405)
--------------------
NET ASSETS--100.0% $ 39,621,875
====================
</TABLE>
(a) Federal Income Tax Information: Net unrealized depreciation of investment
securities is comprised of gross appreciation of $326,554 and gross
depreciation of $1,514,483 for federal income tax purposes. At
September 30, 1999, the aggregate cost of securities for federal income tax
purposes was $42,810,209.
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At September 30,
1999, these securities amounted to a value of $6,401,836 or 16.2% of net
assets.
(c) Variable or step coupon security; interest rate shown reflects the rate
currently in affect.
(d) As rated by Standard & Poor's, Fitch or Duff & Phelps.
(e) All or a portion segregated as collateral.
See Notes to Financial Statements
9
<PAGE>
Phoenix-Seneca Bond Fund
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value
(Identified cost $42,810,209) $41,622,280
Cash 712
Receivables
Investment securities sold 1,109,570
Interest 639,535
Fund shares sold 75,201
Receivable from adviser 34,766
Deferred organization expenses 13,527
Prepaid expenses 1,057
-----------
Total assets 43,496,648
-----------
LIABILITIES
Payables
Investment securities purchased 3,792,714
Fund shares repurchased 1,159
Transfer agent fee 12,352
Financial agent fee 6,475
Distribution fee 5,810
Trustees' fee 776
Accrued expenses 55,487
-----------
Total liabilities 3,874,773
-----------
NET ASSETS $39,621,875
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of
beneficial interest $40,317,078
Undistributed net investment income 211,548
Accumulated net realized gain 281,178
Net unrealized depreciation (1,187,929)
-----------
NET ASSETS $39,621,875
===========
CLASS X
Shares of beneficial interest
outstanding, $1 par value,
unlimited authorization
(Net Assets $34,852,599) 3,368,711
Net asset value and offering price
per share $10.35
CLASS A
Shares of beneficial interest
outstanding, $1 par value,
unlimited authorization
(Net Assets $2,732,094) 265,475
Net asset value per share $10.29
Offering price per share
$10.29/(1-4.75%) $10.80
CLASS B
Shares of beneficial interest
outstanding, $1 par value,
unlimited authorization
(Net Assets $1,593,343) 155,212
Net asset value and offering price
per share $10.27
CLASS C
Shares of beneficial interest
outstanding, $1 par value,
unlimited authorization
(Net Assets $443,839) 43,236
Net asset value and offering price
per share $10.27
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest $ 2,467,528
Dividends 45,110
-----------
Total investment income 2,512,638
-----------
EXPENSES
Investment advisory fee 164,083
Distribution fee, Class A 2,715
Distribution fee, Class B 8,348
Distribution fee, Class C 4,007
Financial agent fee 63,648
Transfer agent 78,647
Registration 47,193
Trustees 25,636
Professional 21,422
Printing 17,498
Custodian 15,114
Amortization of deferred
organization expenses 10,658
Miscellaneous 18,310
-----------
Total expenses 477,279
Less expenses borne by
investment adviser (99,399)
Custodian fees paid indirectly (1,778)
-----------
Net expenses 376,102
-----------
NET INVESTMENT INCOME 2,136,536
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain on securities 286,567
Net change in unrealized
appreciation (depreciation) on
investments (1,374,017)
-----------
NET LOSS ON INVESTMENTS (1,087,450)
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 1,049,086
===========
</TABLE>
10 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Bond Fund
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
9/30/99 9/30/98
----------- -----------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss) $ 2,136,536 $ 815,720
Net realized gain (loss) 286,567 272,954
Net change in unrealized appreciation (depreciation) (1,374,017) (52,850)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 1,049,086 1,035,824
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income, Class X (1,783,876) (816,277)
Net investment income, Class A (62,282) (4,720)
Net investment income, Class B (41,217) (2,101)
Net investment income, Class C (19,340) (3,926)
Net realized gains, Class X (237,256) (157,929)
Net realized gains, Class A (6,691) --
Net realized gains, Class B (3,366) --
Net realized gains, Class C (4,337) --
----------- -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (2,158,365) (984,953)
----------- -----------
FROM SHARE TRANSACTIONS
CLASS X
Proceeds from sales of shares (936,038 and 1,869,631
shares, respectively) 9,870,220 20,104,967
Net asset value of shares issued from reinvestment of
distributions
(188,148 and 89,132 shares, respectively) 1,984,360 952,261
Cost of shares repurchased (232,292 and 334,511 shares,
respectively) (2,442,507) (3,582,416)
----------- -----------
Total 9,412,073 17,474,812
----------- -----------
CLASS A
Proceeds from sales of shares (302,053 and 48,090 shares,
respectively) 3,154,123 515,460
Net asset value of shares issued from reinvestment of
distributions
(5,398 and 388 shares, respectively) 56,422 4,147
Cost of shares repurchased (74,593 and 15,861 shares,
respectively) (783,486) (168,344)
----------- -----------
Total 2,427,059 351,263
----------- -----------
CLASS B
Proceeds from sales of shares (167,067 and 23,658 shares,
respectively) 1,753,608 253,821
Net asset value of shares issued from reinvestment of
distributions
(1,944 and 135 shares, respectively) 20,300 1,443
Cost of shares repurchased (35,679 and 1,913 shares,
respectively) (375,271) (20,509)
----------- -----------
Total 1,398,637 234,755
----------- -----------
CLASS C
Proceeds from sales of shares (50,510 and 40,951 shares,
respectively) 529,791 439,691
Net asset value of shares issued from reinvestment of
distributions
(1,056 and 183 shares, respectively) 11,082 1,951
Cost of shares repurchased (49,464 and 0 shares,
respectively) (522,992) --
----------- -----------
Total 17,881 441,642
----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS 13,255,650 18,502,472
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS 12,146,371 18,553,343
NET ASSETS
Beginning of period 27,475,504 8,922,161
----------- -----------
END OF PERIOD [INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF
$211,548 AND ($11,789), RESPECTIVELY] $39,621,875 $27,475,504
=========== ===========
</TABLE>
See Notes to Financial Statements 11
<PAGE>
Phoenix-Seneca Bond Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS X
--------------------------------------------------
FROM
YEAR ENDED SEPTEMBER 30, INCEPTION
------------------------------- 3/7/96 TO
1999 1998 1997 9/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 10.68 $ 10.47 $ 10.09 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) 0.69(1)(6) 0.56 0.62(1) 0.31(1)
Net realized and unrealized gain
(loss) (0.31) 0.40 0.47 0.08
------- ------- ------- ------
TOTAL FROM INVESTMENT OPERATIONS 0.38 0.96 1.09 0.39
------- ------- ------- ------
LESS DISTRIBUTIONS:
Dividends from net investment income (0.62) (0.57) (0.69) (0.30)
Dividends from net realized gains (0.09) (0.18) (0.02) --
------- ------- ------- ------
TOTAL DISTRIBUTIONS (0.71) (0.75) (0.71) (0.30)
------- ------- ------- ------
Change in net asset value (0.33) 0.21 0.38 0.09
------- ------- ------- ------
NET ASSET VALUE, END OF PERIOD $ 10.35 $ 10.68 $ 10.47 $10.09
======= ======= ======= ======
Total return(2) 3.51% 9.44% 11.26% 4.02%(4)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $34,853 $26,455 $ 8,922 $3,927
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.06%(5)(7) 1.66% 1.53%(5) 0.56%(3)(5)
Net investment income (loss) 6.60% 5.92% 6.31% 7.54%(3)
Portfolio turnover 95% 112% 99.68% 52.82%(4)
</TABLE>
(1) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $0.69, $0.47 and $(0.05) for the years ended
September 30, 1999 and September 30, 1997 and the period ended September
30, 1996, respectively.
(2) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(3) Annualized.
(4) Not annualized.
(5) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.13% and
3.41% and 9.31% for the years ended September 30, 1999 and September 30,
1997 and the period ended September 30, 1996, respectively.
(6) Computed using average shares outstanding.
(7) For the year ended September 30, 1999, the ratio of operating expenses to
average net assets excludes the effect of expense offsets for custodian
fees; if expense offsets were included, the ratio would not significantly
differ.
12
See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Bond Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS A CLASS B
----------------------------- ------------------------------
FROM FROM
YEAR INCEPTION YEAR INCEPTION
ENDED 7/1/98 TO ENDED 7/1/98 TO
9/30/99 9/30/98 9/30/99 9/30/98
<S> <C> <C> <C> <C>
Net asset value,
beginning of period $10.68 $10.79 $10.67 $10.79
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income
(loss) 0.59(1)(10) 0.13(1)(10) 0.52(2)(10) 0.11(2)(10)
Net realized and
unrealized gain
(loss) (0.33) (0.07) (0.33) (0.08)
------ ------ ------ ------
TOTAL FROM
INVESTMENT
OPERATIONS 0.26 0.06 0.19 0.03
------ ------ ------ ------
LESS DISTRIBUTIONS:
Dividends from net
investment income (0.56) (0.17) (0.50) (0.15)
Dividends from net
realized gains (0.09) -- (0.09) --
------ ------ ------ ------
TOTAL DISTRIBUTIONS (0.65) (0.17) (0.59) (0.15)
------ ------ ------ ------
Change in net asset value (0.39) (0.11) (0.40) (0.12)
------ ------ ------ ------
NET ASSET VALUE, END OF
PERIOD $10.29 $10.68 $10.27 $10.67
====== ====== ====== ======
Total return(4) 2.46% 0.53%(6) 1.67% 0.28%(6)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(thousands) $2,732 $ 348 $1,593 $ 234
RATIO TO AVERAGE NET
ASSETS OF:
Operating expenses 1.88%(7)(11) 2.45%(5)(7) 2.62%(8)(11) 3.20%(5)(8)
Net investment income
(loss) 5.80% 5.17%(5) 5.09% 4.42%(5)
Portfolio turnover 95% 112%(6) 95% 112%(6)
<CAPTION>
CLASS C
---------------------------
FROM
YEAR INCEPTION
ENDED 7/1/98 TO
9/30/99 9/30/98
<S> <C> <C>
Net asset value,
beginning of period $10.67 $10.79
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income
(loss) 0.49(3)(10) 0.10(3)(10)
Net realized and
unrealized gain
(loss) (0.30) (0.07)
------ ------
TOTAL FROM
INVESTMENT
OPERATIONS 0.19 0.03
------ ------
LESS DISTRIBUTIONS:
Dividends from net
investment income (0.50) (0.15)
Dividends from net
realized gains (0.09) --
------ ------
TOTAL DISTRIBUTIONS (0.59) (0.15)
------ ------
Change in net asset value (0.40) (0.12)
------ ------
NET ASSET VALUE, END OF
PERIOD $10.27 $10.67
====== ======
Total return(4) 1.66% 0.28%(6)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(thousands) $ 444 $ 439
RATIO TO AVERAGE NET
ASSETS OF:
Operating expenses 2.91%(9)(11) 3.20%(5)(9)
Net investment income
(loss) 4.71% 4.27%(5)
Portfolio turnover 95% 112%(6)
</TABLE>
(1) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $0.36 and $(0.03) for the periods ended September 30,
1999 and September 30, 1998, respectively.
(2) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $0.21 and $(0.21) for the periods ended
September 30, 1999 and September 30, 1998, respectively.
(3) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $(0.20) and $(0.08) for the periods ended
September 30, 1999 and September 30, 1998, respectively.
(4) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(5) Annualized.
(6) Not annualized.
(7) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 4.08% and
8.99% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
(8) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 5.67% and
15.79% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
(9) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 9.50% and
11.22% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
(10) Computed using average shares outstanding.
(11) For the year ended September 30, 1999, the ratio of operating expenses to
average net assets excludes the effect of expense offsets for custodian
fees; if expense offsets were included, the ratio would not significantly
differ.
See Notes to Financial Statements
13
<PAGE>
PHOENIX-SENECA GROWTH FUND
A DISCUSSION WITH THE FUND'S PORTFOLIO MANAGERS, GAIL P. SENECA, PH.D.,
AND RICHARD D. LITTLE, CFA
Q: WHAT IS THE INVESTMENT OBJECTIVE OF THE FUND?
A: The Phoenix-Seneca Growth Fund seeks capital appreciation by investing in
stocks across all market capitalizations. The Fund takes a growth-
with-controlled-risk approach, combining the growth potential of mid-cap stocks
with the appreciation potential of well-established, large-cap stocks. The Fund
is suitable for investors who seek capital appreciation through a conservative,
disciplined approach.
Q: CAN YOU PROVIDE A BRIEF OVERVIEW OF THE MARKET?
A: In this year's volatile and spotty market, growth stocks, led by the largest
technology companies, have been the clear winners. This year's growth stock
advantage continues a two-year trend, during which "growth" has outperformed
"value" by a wide margin. As a result, today's growth stocks sport their highest
valuations ever.
We believe these valuations are sustainable. The corporate fundamentals of
"growth" stocks today are excellent. Real returns on equity are at all-time
highs, meaning that companies are leveraging their capital effectively. Revenue
and earnings growth of the largest technology companies is in double-digit
territory, a remarkable achievement for multibillion-dollar enterprises.
Research and development spending and current capital spending are robust,
suggesting investment for future growth.
The moderation of the boom/bust cycle in the overall economy should also
help sustain generous growth stock valuations. Due largely to technology
improvements, inventory-led booms and busts have been notably absent for the
last 10 years. Instead, the economy oscillates modestly, pausing only for short
and shallow recessions. In this more tempered business cycle, it is difficult
for cyclical companies to gain relative advantage. In contrast, growth stocks
prosper.
Q: HOW DID THE PORTFOLIO PERFORM IN THIS ENVIRONMENT?
A: Our growth-oriented portfolio performed very well. Class A shares returned
31.89%, Class B shares earned 30.31%, Class C shares were up 30.20%, and
Class X shares earned 32.19% for the fiscal year ended September 30, 1999,
compared with a return of 27.73% for the S&P 500 Index(1). All performance
figures assume reinvestment of distributions and exclude the effect of sales
charges.
Q: WHAT IS YOUR NEAR-TERM OUTLOOK?
A: Difficult liquidity conditions in the market will probably persist in the
near term, and as the media embraces the "Y2K" drama, investors may react
rashly. We expect market action in the next few months to rival the volatility
that has plagued us all year.
Amid this turmoil, however, we believe very favorable fundamental conditions
remain intact. Corporate earnings quality is strengthening, with fewer
write-offs and stronger operating earnings. And, despite well-advertised
inflation threats, actual inflation readings should remain subdued. The Federal
Reserve could raise rates yet again, but the bulk of the interest rate rise is
very likely behind us, in our opinion.
OCTOBER 19, 1999
(1) THE S&P 500 INDEX IS AN UNMANAGED, COMMONLY USED MEASURE OF STOCK MARKET
TOTAL RETURN PERFORMANCE. THE INDEX IS NOT AVAILABLE FOR DIRECT INVESTMENT.
14
<PAGE>
Phoenix-Seneca Growth Fund
AVERAGE ANNUAL TOTAL RETURNS(1) PERIOD ENDING 9/30/99
<TABLE>
<CAPTION>
INCEPTION INCEPTION
1 YEAR TO 9/30/99 DATE
------- ----------- ---------
<S> <C> <C> <C>
Class X Shares at NAV(2) 32.19% 29.42% 3/8/96
Class A Shares at NAV(2) 31.89 28.65 3/8/96
Class A Shares at POP(3) 25.62 26.90 3/8/96
Class B Shares at NAV(2) 30.31 10.09 7/1/98
Class B Shares with CDSC(4) 26.31 6.95 7/1/98
Class C Shares at NAV(2) 30.20 9.96 7/1/98
Class C Shares with CDSC(4) 30.20 9.96 7/1/98
S&P 500 Index(7) 27.73 Note 5 Note 5
</TABLE>
(1) Total returns are historical and include changes in share price and the
reinvestment of both dividends and capital gains distributions.
(2) "NAV" (Net Asset Value) total returns do not include the effect of any
sales charge.
(3) "POP" (Public Offering Price) total returns include the effect of the
maximum front-end 4.75% sales charge.
(4) CDSC (contingent deferred sales charge) is applied to redemptions of
certain classes of shares that do not have a sales charge applied at the
time of purchase. CDSC charges for B shares decline from 5% to 0% over a
five year period. CDSC charges for C shares are 1% in the first year and 0%
thereafter.
(5) Index performance is 24.05% for Class X and Class A (since 3/8/96) and
10.81% for Class B and Class C (since 7/1/98).
(6) This chart illustrates NAV returns on Class X shares and POP returns on
Class A shares. Returns on Class B and Class C shares will vary due to
differing sales charges.
(7) The S&P 500 Index is an unmanaged, commonly used measure of stock market
total return performance. The index's performance does not reflect sales
charges.
All returns represent past performance which may not be indicative of
future performance. The investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
GROWTH OF $10,000 PERIODS ENDING 9/30
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PHOENIX-SENECA GROWTH PHOENIX-SENECA GROWTH S&P
<S> <C> <C> <C>
Fund Class X at Fund Class A at 500
NAV(6) POP(6) Index(7)
3/8/1996 $10,000 $9,525 $10,000
9/30/1996 $13,740 $12,983 $10,992
9/30/1997 $17,486 $16,424 $15,462
9/30/1998 $18,968 $17,726 $16,876
9/30/1999 $25,074 $23,378 $21,556
</TABLE>
This Growth of $10,000 chart assumes an initial investment of $10,000 made on
3/8/96 (inception of the Fund) in Class X and A shares. The total return for
Class X shares reflects no sales charge. The total return for Class A shares
reflects the maximum sales charge of 4.75% on the initial investment.
Performance assumes dividends and capital gains are reinvested. The performance
of other share classes will be greater or less than that shown based on
differences in inception dates, fees and sales charges.
SECTOR WEIGHTINGS 9/30/99
As a percentage of equity holdings
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Technology 32%
Consumer Cyclicals 13
Financials 11
Energy 10
Capital Goods 8
Consumer Staples 8
Communication Service 7
Other 11
</TABLE>
15
<PAGE>
Phoenix-Seneca Growth Fund
TEN LARGEST HOLDINGS AT SEPTEMBER 30, 1999 (AS A PERCENTAGE OF NET ASSETS)
<TABLE>
<C> <S> <C>
1. Tyco International Ltd. 4.2%
DIVERSIFIED MANUFACTURING AND SERVICES COMPANY
2. Microsoft Corp. 4.2%
WORLD'S LEADING COMPUTER SOFTWARE COMPANY
3. Sun Microsystems, Inc. 4.1%
SUPPLIER OF ENTERPRISE NETWORK COMPUTING PRODUCTS
4. Outdoor Systems, Inc. 3.8%
OPERATES MALL AND TRANSIT ADVERTISING DISPLAYS
5. Citigroup, Inc. 3.7%
DIVERSIFIED FINANCIAL SERVICES HOLDING COMPANY
6. Nortel Networks Corp. (Canada) 3.7%
TELECOMMUNICATIONS EQUIPMENT MANUFACTURER
7. General Electric Co. 3.6%
DIVERSIFIED MANUFACTURING AND FINANCIAL SERVICES PROVIDER
8. Bristol-Myers Squibb Co. 3.5%
COMPREHENSIVE HEALTH-CARE COMPANY
9. Morgan Stanley Dean Witter & Co. 3.5%
PROVIDES A BROAD RANGE OF CREDIT AND INVESTMENT PRODUCTS TO
INDIVIDUALS
10. Motorola, Inc. 3.5%
GLOBAL PROVIDER OF INTEGRATED COMMUNICATIONS PRODUCTS
</TABLE>
INVESTMENTS AT SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
COMMON STOCKS--85.8%
ALUMINUM--3.5%
Alcoa, Inc.............................. 40,660 $ 2,523,461
BANKS (MAJOR REGIONAL)--3.0%
Mellon Bank Corp........................ 64,410 2,173,838
BROADCASTING (TELEVISION, RADIO & CABLE)--3.3%
AMFM, Inc.(b)........................... 39,590 2,410,041
CHEMICALS--2.1%
Dow Chemical Co......................... 13,210 1,500,986
COMMUNICATIONS EQUIPMENT--6.2%
General Motors Corp. Class H(b)......... 34,540 1,977,415
Motorola, Inc........................... 28,770 2,531,760
-----------
4,509,175
-----------
COMPUTERS (HARDWARE)--6.0%
International Business Machines Corp.... 11,590 1,406,736
Sun Microsystems, Inc.(b)............... 32,000 2,976,000
-----------
4,382,736
-----------
COMPUTERS (NETWORKING)--3.0%
Cisco Systems, Inc.(b).................. 29,140 1,997,911
Internap Network Services Corp.(b)...... 4,040 180,285
-----------
2,178,196
-----------
COMPUTERS (SOFTWARE & SERVICES)--4.2%
Microsoft Corp.(b)...................... 33,740 3,055,579
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
ELECTRICAL EQUIPMENT--3.6%
General Electric Co..................... 22,060 $ 2,615,489
ELECTRONICS (SEMICONDUCTORS)--1.3%
Intel Corp.............................. 13,200 980,925
FINANCIAL (DIVERSIFIED)--7.2%
Citigroup, Inc.......................... 61,930 2,724,920
Morgan Stanley Dean Witter & Co......... 28,450 2,537,384
-----------
5,262,304
-----------
FOODS--1.8%
General Mills, Inc...................... 16,480 1,336,940
HEALTH CARE (DIVERSIFIED)--5.9%
Bristol-Myers Squibb Co................. 37,940 2,560,950
Johnson & Johnson....................... 18,940 1,740,113
-----------
4,301,063
-----------
HOUSEHOLD FURNISHINGS & APPLIANCES--1.2%
Whirlpool Corp.......................... 13,990 913,722
HOUSEHOLD PRODUCTS (NON-DURABLE)--2.4%
Procter & Gamble Co. (The).............. 18,540 1,738,125
MANUFACTURING (DIVERSIFIED)--4.2%
Tyco International Ltd.................. 29,610 3,057,233
OIL & GAS (DRILLING & EQUIPMENT)--6.4%
Baker Hughes, Inc....................... 74,100 2,148,900
Halliburton Co.......................... 60,870 2,495,670
-----------
4,644,570
-----------
</TABLE>
16 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Growth Fund
<TABLE>
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
OIL (INTERNATIONAL INTEGRATED)--3.1%
Texaco, Inc............................. 36,350 $ 2,294,594
RETAIL (COMPUTERS & ELECTRONICS)--3.1%
Tandy Corp.............................. 43,750 2,261,328
RETAIL (GENERAL MERCHANDISE)--1.9%
Wal-Mart Stores, Inc.................... 29,900 1,422,119
RETAIL (SPECIALTY-APPAREL)--2.4%
TJX Companies, Inc. (The)............... 62,290 1,748,013
SERVICES (ADVERTISING/MARKETING)--3.8%
Outdoor Systems, Inc.(b)................ 76,590 2,738,093
TELECOMMUNICATIONS (LONG DISTANCE)--3.2%
MCI WorldCom, Inc.(b)................... 32,950 2,368,281
TELEPHONE--3.0%
Bell Atlantic Corp...................... 32,190 2,166,789
- ------------------------------------------------------------------
TOTAL COMMON STOCKS
(IDENTIFIED COST $52,029,496) 62,583,600
- ------------------------------------------------------------------
FOREIGN COMMON STOCKS--9.7%
COMMUNICATIONS EQUIPMENT--6.9%
Nokia Oyj Sponsored ADR (Finland)....... 25,850 2,321,653
Nortel Networks Corp. (Canada).......... 52,730 2,689,230
-----------
5,010,883
-----------
ELECTRONICS (SEMICONDUCTORS)--2.8%
STMicroelectronics N.V. (Netherlands)... 27,300 2,020,200
- ------------------------------------------------------------------
TOTAL FOREIGN COMMON STOCKS
(IDENTIFIED COST $6,778,972) 7,031,083
- ------------------------------------------------------------------
TOTAL LONG-TERM INVESTMENTS--95.5%
(IDENTIFIED COST $58,808,468) 69,614,683
- ------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PAR
VALUE
(000) VALUE
------- -----------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--7.6%
REPURCHASE AGREEMENT--7.6%
State Street Bank & Trust Co. repurchase
agreement, 4.25%, dated 9/30/99 due
10/1/99, repurchase price $5,545,655
collateralized by U.S. Treasury Note
5.50%, 3/31/00, market value
$5,657,063.............................. $ 5,545 $ 5,545,000
- ------------------------------------------------------------------
TOTAL SHORT-TERM OBLIGATIONS
(IDENTIFIED COST $5,545,000) 5,545,000
- ------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL INVESTMENTS--103.1%
(IDENTIFIED COST $64,353,468) 75,159,683(a)
Cash and receivables, less liabilities--(3.1%) (2,236,353)
--------------------
NET ASSETS--100.0% $ 72,923,330
====================
</TABLE>
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $12,536,684 and gross
depreciation of $1,844,747 for federal income tax purposes. At
September 30, 1999, the aggregate cost of securities for federal income tax
purposes was $64,467,746.
(b) Non-income producing.
See Notes to Financial Statements
17
<PAGE>
Phoenix-Seneca Growth Fund
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value
(Identified cost $64,353,468) $75,159,683
Cash 898
Receivables
Fund shares sold 158,602
Dividends and interest 35,815
Deferred organization expenses 13,527
Prepaid expenses 3,669
-----------
Total assets 75,372,194
-----------
LIABILITIES
Payables
Investment securities purchased 2,292,003
Fund shares repurchased 7,910
Distribution fee 32,748
Transfer agent fee 13,453
Investment advisory fee 13,450
Financial agent fee 5,852
Trustees' fee 856
Accrued expenses 82,592
-----------
Total liabilities 2,448,864
-----------
NET ASSETS $72,923,330
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial
interest $55,020,063
Accumulated net realized gain 7,097,052
Net unrealized appreciation 10,806,215
-----------
NET ASSETS $72,923,330
===========
CLASS X
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$35,694,595) 1,791,537
Net asset value and offering price per share $19.92
CLASS A
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$31,000,738) 1,584,310
Net asset value per share $19.57
Offering price per share $19.57/(1-4.75%) $20.55
CLASS B
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$4,394,693) 227,897
Net asset value and offering price per share $19.28
CLASS C
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$1,833,304) 95,222
Net asset value and offering price per share $19.25
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends $ 465,256
Interest 141,205
-----------
Total investment income 606,461
-----------
EXPENSES
Investment advisory fee 443,317
Distribution fee, Class A 66,526
Distribution fee, Class B 24,197
Distribution fee, Class C 9,293
Financial agent fee 85,097
Transfer agent 88,614
Registration 53,567
Printing 40,695
Trustees 25,716
Professional 23,412
Custodian 12,443
Amortization of deferred
organization expenses 10,658
Miscellaneous 23,541
-----------
Total expenses 907,076
Less expenses borne by
investment adviser (49,249)
-----------
Net expenses 857,827
-----------
NET INVESTMENT LOSS (251,366)
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain on securities 7,420,446
Net change in unrealized
appreciation (depreciation) on
investments 8,897,166
-----------
NET GAIN ON INVESTMENTS 16,317,612
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $16,066,246
===========
</TABLE>
18 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Growth Fund
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
9/30/99 9/30/98
----------- -----------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss) $ (251,366) $ (23,589)
Net realized gain (loss) 7,420,446 5,786,850
Net change in unrealized appreciation (depreciation) 8,897,166 (3,716,413)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 16,066,246 2,046,848
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income, Class X -- (28,234)
Net realized gains, Class X (2,678,808) (2,638,126)
Net realized gains, Class A (2,257,410) (456,891)
Net realized gains, Class B (125,950) --
Net realized gains, Class C (32,675) --
----------- -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (5,094,843) (3,123,251)
----------- -----------
FROM SHARE TRANSACTIONS
CLASS X
Proceeds from sales of shares (191,178 and 285,390 shares,
respectively) 3,657,324 4,884,932
Net asset value of shares issued from reinvestment of
distributions
(152,656 and 175,598 shares, respectively) 2,665,381 2,655,713
Cost of shares repurchased (417,927 and 669,955 shares,
respectively) (7,626,080) (11,501,669)
----------- -----------
Total (1,303,375) (3,961,024)
----------- -----------
CLASS A
Proceeds from sales of shares (713,052 and 903,203 shares,
respectively) 12,978,542 16,095,224
Net asset value of shares issued from reinvestment of
distributions
(130,999 and 30,397 shares, respectively) 2,250,565 454,436
Cost of shares repurchased (329,410 and 233,349 shares,
respectively) (5,879,689) (3,581,463)
----------- -----------
Total 9,349,418 12,968,197
----------- -----------
CLASS B
Proceeds from sales of shares (209,861 and 32,039 shares,
respectively) 3,860,313 544,661
Net asset value of shares issued from reinvestment of
distributions
(5,386 and 0 shares, respectively) 92,053 --
Cost of shares repurchased (19,389 and 0 shares,
respectively) (368,688) --
----------- -----------
Total 3,583,678 544,661
----------- -----------
CLASS C
Proceeds from sales of shares (88,996 and 7,802 shares,
respectively) 1,633,483 139,674
Net asset value of shares issued from reinvestment of
distributions
(1,890 and 0 shares, respectively) 32,392 --
Cost of shares repurchased (3,466 and 0 shares,
respectively) (65,089) --
----------- -----------
Total 1,600,786 139,674
----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS 13,230,507 9,691,508
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS 24,201,910 8,615,105
NET ASSETS
Beginning of period 48,721,420 40,106,315
----------- -----------
END OF PERIOD [INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF
$0 AND $0, RESPECTIVELY] $72,923,330 $48,721,420
=========== ===========
</TABLE>
See Notes to Financial Statements 19
<PAGE>
Phoenix-Seneca Growth Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS X
----------------------------------------------------
FROM
YEAR ENDED SEPTEMBER 30 INCEPTION
------------------------------------ 3/8/96 TO
1999 1998 1997 9/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 16.46 $ 16.43 $ 13.74 $ 10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.04)(1) 0.00(1) 0.03(2) 0.03(2)
Net realized and unrealized gain (loss) 5.11 1.28 3.50 3.71
------- ------- -------- -------
TOTAL FROM INVESTMENT OPERATIONS 5.07 1.28 3.53 3.74
------- ------- -------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income -- (0.02) (0.07) --
Dividends from net realized gains (1.61) (1.23) (0.77) --
------- ------- -------- -------
TOTAL DISTRIBUTIONS (1.61) (1.25) (0.84) --
------- ------- -------- -------
Change in net asset value 3.46 0.03 2.69 3.74
------- ------- -------- -------
NET ASSET VALUE, END OF PERIOD $ 19.92 $ 16.46 $ 16.43 $ 13.74
======= ======= ======== =======
Total return(3) 32.19 % 8.48% 27.27% 37.40%(5)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $35,695 $30,713 $34,093 $12,920
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.16 % 1.14% 1.52%(6) 0.81%(4)(6)
Net investment income (loss) (0.20)% 0.02% 0.31% 0.76%(4)
Portfolio turnover 169 % 166% 145.69% 87.66%(5)
</TABLE>
(1) Computed using average shares outstanding.
(2) Net investment income (loss) is after waiver of certain fees and
reimbursement of certain expenses by the investment adviser. If the
investment adviser had not waived fees and reimbursed expenses, net
investment income (loss) per share would have been $0.03 and $(0.09) for the
year ended September 30, 1997 and the period ended September 30, 1996,
respectively.
(3) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(4) Annualized.
(5) Not annualized.
(6) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.52% and
3.49% for the year ended September 30, 1997 and the period ended
September 30, 1996, respectively.
20 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Growth Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS A
--------------------------------------------------
FROM
YEAR ENDED SEPTEMBER 30 INCEPTION
---------------------------------- 3/8/96 TO
1999 1998 1997 9/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 16.23 $ 16.28 $13.63 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.09)(1) (0.06)(1) (0.08)(2) --(2)
Net realized and unrealized gain 5.04 1.24 3.50 3.63
------- ------- ------ ------
TOTAL FROM INVESTMENT OPERATIONS 4.95 1.18 3.42 3.63
------- ------- ------ ------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- -- --
Dividends from net realized gains (1.61) (1.23) (0.77) --
------- ------- ------ ------
TOTAL DISTRIBUTIONS (1.61) (1.23) (0.77) --
------- ------- ------ ------
Change in net asset value 3.34 (0.05) 2.65 3.63
------- ------- ------ ------
NET ASSET VALUE, END OF PERIOD $ 19.57 $ 16.23 $16.28 $13.63
======= ======= ====== ======
Total return(3) 31.89 % 7.93 % 26.51 % 36.30%(5)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $31,001 $17,364 $6,013 $466
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.44 % 1.55 % 2.48 %(6) 1.46%(4)(6)
Net investment income (loss) (0.49)% (0.36)% (0.62)% 0.16%(4)
Portfolio turnover 169 % 166 % 145.69 % 87.66%(5)
</TABLE>
(1) Computed using average shares outstanding.
(2) Net investment income (loss) is after waiver of certain fees and
reimbursement of certain expenses by the investment adviser. If the
investment adviser had not waived fees and reimbursed expenses, net
investment income (loss) per share would have been $(0.09) and $(0.34) for
the year ended September 30, 1997 and the period ended September 30, 1996,
respectively.
(3) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(4) Annualized.
(5) Not annualized.
(6) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.63% and
14.01% for the year ended September 30, 1997 and the period ended
September 30, 1996, respectively.
See Notes to Financial Statements 21
<PAGE>
Phoenix-Seneca Growth Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS B CLASS C
------------------------------ ------------------------------
FROM FROM
YEAR INCEPTION YEAR INCEPTION
ENDED 7/1/98 TO ENDED 7/1/98 TO
9/30/99 9/30/98 9/30/99 9/30/98
<S> <C> <C> <C> <C>
Net asset value, beginning of period $16.19 $18.71 $16.18 $18.71
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.31)(1)(8) (0.04)(1)(8) (0.32)(2)(8) (0.06)(2)(8)
Net realized and unrealized gain (loss) 5.01 (2.48) 5.00 (2.47)
------ ------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS 4.70 (2.52) 4.68 (2.53)
------ ------ ------ ------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- -- --
Dividends from net realized gains (1.61) -- (1.61) --
------ ------ ------ ------
TOTAL DISTRIBUTIONS (1.61) -- (1.61) --
------ ------ ------ ------
Change in net asset value 3.09 (2.52) 3.07 (2.53)
------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $19.28 $16.19 $19.25 $16.18
====== ====== ====== ======
Total return(3) 30.31 % (13.47)%(5) 30.20 % (13.52)%(5)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $4,395 $519 $1,833 $126
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.60 %(6) 2.60 %(4)(6) 2.60 %(7) 2.60%(4)(7)
Net investment income (loss) (1.66)% (1.12)%(4) (1.66)% (1.39)%(4)
Portfolio turnover 169 % 166 %(5) 169 % 166 %(5)
</TABLE>
(1) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $(0.47) and $(0.36) for the periods ended
September 30, 1999 and September 30, 1998, respectively.
(2) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $(0.90) and $(0.79) for the periods ended
September 30, 1999 and September 30, 1998, respectively.
(3) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(4) Annualized.
(5) Not annualized.
(6) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 3.46% and
12.48% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
(7) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 5.67% and
20.24% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
(8) Computed using average shares outstanding.
22 See Notes to Financial Statements
<PAGE>
PHOENIX-SENECA MID-CAP "EDGE"-SM- FUND
A DISCUSSION WITH THE FUND'S PORTFOLIO MANAGERS, GAIL P. SENECA, PH.D., AND
RICHARD D. LITTLE, CFA
Q: WHAT IS THE INVESTMENT OBJECTIVE OF THE FUND?
A: The Phoenix-Seneca Mid-Cap "EDGE"(SM) Fund seeks capital appreciation by
investing in rapidly growing companies with the potential for accelerating
revenues and increasing profits.
Q: HOW DID THE FUND PERFORM OVER THE LAST 12 MONTHS?
A: For the fiscal year ended September 30, 1999, Class A shares returned 32.27%,
Class B shares earned 31.05%, Class C shares were up 31.07%, and Class X shares
rose 33.02%. These returns compare with a return of 25.49% for the S&P 400
MidCap Index(1). All performance figures assume reinvestment of distributions
and exclude the effect of sales charges.
Q: WHAT FACTORS LED TO YOUR STRONG PERFORMANCE RELATIVE TO THE BENCHMARK?
A: Good stock selection and the outperformance of "growth" sectors, such as
technology, helped the portfolio's performance. The best performing stocks
included Xilinx, a producer of programmable semiconductors, RF Micro Devices, a
developer of power boosters that extend battery life and improve cell phone
range, and VERITAS Software, a maker of computer storage management products. We
also benefited from limited exposure to the financial services and health-care
sectors, which continued to underperform.
Q: WHAT IS YOUR NEAR-TERM OUTLOOK?
A: Difficult liquidity conditions in the market will probably persist in the
near term, and as the media embraces the "Y2K" drama, investors may react
rashly. We expect market action in the next few months to rival the volatility
that has plagued us all year.
Amid this turmoil, however, we believe very favorable fundamental conditions
remain intact. Corporate earnings quality is strengthening, with fewer
write-offs and stronger operating earnings. And, despite well-advertised
inflation threats, actual inflation readings should remain subdued. The Federal
Reserve could raise rates yet again, but the bulk of the interest rate rise is
very likely behind us, in our opinion.
OCTOBER 19, 1999
(1) THE S&P 400 MIDCAP INDEX IS AN UNMANAGED, COMMONLY USED MEASURE OF MID-CAP
STOCK TOTAL RETURN PERFORMANCE. THE INDEX IS NOT AVAILABLE FOR DIRECT
INVESTMENT.
23
<PAGE>
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund
AVERAGE ANNUAL TOTAL RETURNS(1) PERIOD ENDING 9/30/99
<TABLE>
<CAPTION>
INCEPTION INCEPTION
1 YEAR TO 9/30/99 DATE
------- ---------- ---------
<S> <C> <C> <C>
Class X Shares at NAV(2) 33.02% 23.54% 3/8/96
Class A Shares at NAV(2) 32.27 23.02 3/8/96
Class A Shares at POP(3) 25.99 21.35 3/8/96
Class B Shares at NAV(2) 31.05 3.92 7/1/98
Class B Shares with CDSC(4) 27.05 0.73 7/1/98
Class C Shares at NAV(2) 31.07 3.87 7/1/98
Class C Shares with CDSC(4) 31.07 3.87 7/1/98
S&P 400 MidCap Index(7) 25.49 Note 5 Note 5
</TABLE>
(1) Total returns are historical and include changes in share price and the
reinvestment of both dividends and capital gains distributions.
(2) "NAV" (Net Asset Value) total returns do not include the effect of any
sales charge.
(3) "POP" (Public Offering Price) total returns include the effect of the
maximum front-end 4.75% sales charge.
(4) CDSC (contingent deferred sales charge) is applied to redemptions of
certain classes of shares that do not have a sales charge applied at the
time of purchase. CDSC charges for B shares decline from 5% to 0% over a
five year period. CDSC charges for C shares are 1% in the first year and 0%
thereafter.
(5) Index performance is 17.54% for Class X and Class A (since 3/8/96) and
4.53% for Class B and Class C (since 7/1/98).
(6) This chart illustrates NAV returns on Class X shares and POP returns on
Class A shares. Returns on Class B and Class C shares will vary due to
differing sales charges.
(7) The S&P 400 MidCap Index is an unmanaged, commonly used measure of mid-cap
stock total return performance. The index's performance does not reflect
sales charges.
All returns represent past performance which may not be indicative of
future performance. The investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
GROWTH OF $10,000 PERIODS ENDING 9/30
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PHOENIX-SENECA MID-CAP PHOENIX-SENECA MID-CAP S&P 400
<S> <C> <C> <C>
"EDGE"-SM- Fund Class "EDGE"-SM- Fund Class MidCap
X at NAV(6) A at POP(6) Index(7)
3/96 $10,000 $9,525 $10,000
96 $14,970 $14,221 $10,876
97 $16,676 $15,820 $15,129
98 $15,972 $15,070 $14,176
99 $21,246 $19,933 $17,791
</TABLE>
This Growth of $10,000 chart assumes an initial investment of $10,000 made on
3/8/96 (inception of the Fund) in Class X and A shares. The total return for
Class X shares reflects no sales charge. The total return for Class A shares
reflects the maximum sales charge of 4.75% on the initial investment.
Performance assumes dividends and capital gains are reinvested. The performance
of other share classes will be greater or less than that shown based on
differences in inception dates, fees and sales charges.
SECTOR WEIGHTINGS 9/30/99
As a percentage of equity holdings
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Technology 44%
Consumer Cyclicals 22
Energy 8
Capital Goods 7
Financials 7
Basic Materials 6
Consumer Staples 6
</TABLE>
24
<PAGE>
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund
TEN LARGEST HOLDINGS AT SEPTEMBER 30, 1999 (AS A PERCENTAGE OF NET ASSETS)
<TABLE>
<C> <S> <C>
1. Comverse Technology, Inc. 4.7%
MANUFACTURES SPECIAL PURPOSE COMPUTER AND TELECOMMUNICATIONS
SYSTEMS
2. Tandy Corp. 4.5%
CONSUMER ELECTRONICS RETAILER
3. VERITAS Software Corp. 4.5%
SUPPLIER OF DATA STORAGE MANAGEMENT SOLUTIONS
4. Xilinx, Inc. 3.9%
DESIGNS AND SELLS PROGRAMMABLE LOGIC DEVICES
5. Weatherford International, Inc. 3.9%
OIL AND GAS EQUIPMENT SUPPLIER
6. KLA-Tencor Corp. 3.8%
SEMICONDUCTOR MANUFACTURER
7. UnionBanCal Corp. 3.8%
PACIFIC REGIONAL BANK
8. PMC-Sierra, Inc. 3.7%
MANUFACTURER OF SEMICONDUCTORS AND INTEGRATED CIRCUITS
9. Nabors Industries, Inc. 3.5%
OIL AND GAS LAND DRILLING CONTRACTOR
10. SPX Corp. 3.5%
PROVIDES SERVICE TOOLS TO THE MOTOR VEHICLE INDUSTRY
</TABLE>
INVESTMENTS AT SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C> <C>
COMMON STOCKS--95.0%
AUTO PARTS & EQUIPMENT--2.3%
Lear Corp.(b)................. 13,100 $ 460,956
BANKS (MAJOR REGIONAL)--2.7%
Comerica, Inc................. 10,505 531,816
BANKS (REGIONAL)--3.8%
UnionBanCal Corp.............. 20,500 743,125
BROADCASTING (TELEVISION, RADIO & CABLE)--6.1%
AMFM, Inc.(b)................. 10,660 648,927
EchoStar Communications
Corp.(b)...................... 6,240 566,670
-----------
1,215,597
-----------
CHEMICALS (SPECIALTY)--1.5%
Hercules, Inc................. 10,310 295,124
COMMUNICATIONS EQUIPMENT--7.0%
American Tower Corp. Class
A(b).......................... 23,850 466,566
Comverse Technology,
Inc.(b)....................... 9,795 923,791
-----------
1,390,357
-----------
COMPUTERS (HARDWARE)--4.2%
Copper Mountain Networks,
Inc.(b)....................... 4,460 390,807
Paradyne Networks, Inc.(b).... 15,770 441,560
-----------
832,367
-----------
COMPUTERS (SOFTWARE & SERVICES)--4.5%
VERITAS Software Corp.(b)..... 11,690 887,709
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C> <C>
ELECTRICAL EQUIPMENT--4.7%
SPX Corp.(b).................. 7,540 $ 684,255
Universal Electronics,
Inc.(b)....................... 10,750 248,594
-----------
932,849
-----------
ELECTRONICS (SEMICONDUCTORS)--19.2%
Applied Micro Circuits
Corp.(b)...................... 9,520 542,640
LSI Logic Corp.(b)............ 10,100 520,150
PMC-Sierra, Inc.(b)........... 7,940 734,450
RF Micro Devices, Inc.(b)..... 14,520 664,290
SDL, Inc.(b).................. 7,250 553,266
Xilinx, Inc.(b)............... 11,790 772,613
-----------
3,787,409
-----------
EQUIPMENT (SEMICONDUCTOR)--3.8%
KLA-Tencor Corp.(b)........... 11,530 749,450
GAMING, LOTTERY & PARI-MUTUEL COMPANIES--0.5%
Park Place Entertainment
Corp.(b)...................... 7,600 95,000
MANUFACTURING (DIVERSIFIED)--2.0%
Yankee Candle Co., Inc.
(The)(b)...................... 20,650 398,803
OIL & GAS (DRILLING & EQUIPMENT)--7.4%
Nabors Industries, Inc.(b).... 27,590 689,750
Weatherford International,
Inc.(b)....................... 23,880 764,160
-----------
1,453,910
-----------
PAPER & FOREST PRODUCTS--4.7%
Mead Corp. (The).............. 12,250 421,094
</TABLE>
See Notes to Financial Statements 25
<PAGE>
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund
<TABLE>
<CAPTION>
SHARES VALUE
------- ------------
<S> <C> <C> <C>
PAPER & FOREST PRODUCTS--CONTINUED
Smurfit-Stone Container
Corp.(b)...................... 23,300 $ 503,863
-----------
924,957
-----------
RETAIL (COMPUTERS & ELECTRONICS)--6.8%
Best Buy Co., Inc.(b)......... 7,430 461,124
Tandy Corp.................... 17,200 889,025
-----------
1,350,149
-----------
RETAIL (SPECIALTY-APPAREL)--5.8%
Abercrombie & Fitch Co. Class
A(b).......................... 16,910 575,997
TJX Companies, Inc. (The)..... 20,290 569,388
-----------
1,145,385
-----------
SERVICES (ADVERTISING/MARKETING)--3.2%
Outdoor Systems, Inc.(b)...... 17,485 625,089
SERVICES (COMMERCIAL & CONSUMER)--2.1%
Crown Castle International
Corp.(b)...................... 22,220 415,931
SERVICES (DATA PROCESSING)--2.7%
Concord EFS, Inc.(b).......... 25,890 533,981
- ---------------------------------------------------------
TOTAL COMMON STOCKS
(IDENTIFIED COST $16,579,214) 18,769,964
- ---------------------------------------------------------
TOTAL LONG-TERM INVESTMENTS--95.0%
(IDENTIFIED COST $16,579,214) 18,769,964
- ---------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PAR
VALUE
(000) VALUE
------- ------------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--10.4%
REPURCHASE AGREEMENT--10.4%
State Street Bank & Trust Co.
repurchase agreement, 4.25%,
dated 9/30/99 due 10/1/99,
repurchase price $2,052,242
collateralized by U.S.
Treasury Note 5.50%, 3/31/00,
market value $2,097,619....... $ 2,052 $ 2,052,000
- ---------------------------------------------------------
TOTAL SHORT-TERM OBLIGATIONS
(IDENTIFIED COST $2,052,000) 2,052,000
- ---------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL INVESTMENTS--105.4%
(IDENTIFIED COST $18,631,214) 20,821,964(a)
Cash and receivables, less
liabilities--(5.4%) (1,074,280)
-----------
NET ASSETS--100.0% $19,747,684
===========
</TABLE>
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $3,283,643 and gross
depreciation of $1,093,324 for federal income tax purposes. At
September 30, 1999, the aggregate cost of securities for federal income tax
purposes was $18,631,645.
(b) Non-income producing.
26
See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value
(Identified cost $18,631,214) $20,821,964
Cash 14,621
Receivables
Fund shares sold 112,218
Investment securities sold 42,843
Dividends and interest 8,604
Receivable from adviser 7,917
Deferred organization expenses 13,527
Prepaid expenses 1,132
-----------
Total assets 21,022,826
-----------
LIABILITIES
Payables
Investment securities purchased 1,177,527
Fund shares repurchased 1,037
Transfer agent fee 13,298
Distribution fee 10,031
Financial agent fee 5,352
Trustees' fee 913
Accrued expenses 66,984
-----------
Total liabilities 1,275,142
-----------
NET ASSETS $19,747,684
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial
interest 15,537,102
Accumulated net realized gain 2,019,832
Net unrealized appreciation 2,190,750
-----------
NET ASSETS $19,747,684
===========
CLASS X
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$10,640,039) 598,363
Net asset value and offering price per share $17.78
CLASS A
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$6,456,794) 366,822
Net asset value per share $17.60
Offering price per share $17.60/(1-4.75%) $18.48
CLASS B
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$1,675,972) 96,280
Net asset value and offering price per share $17.41
CLASS C
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$974,879) 56,027
Net asset value and offering price per share $17.40
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends $ 66,889
Interest 56,334
----------
Total investment income 123,223
----------
EXPENSES
Investment advisory fee 142,594
Distribution fee, Class A 13,633
Distribution fee, Class B 8,493
Distribution fee, Class C 4,918
Financial agent fee 54,410
Transfer agent 85,382
Registration 44,456
Printing 29,112
Trustees 25,773
Professional 16,744
Amortization of deferred organization
expenses 10,658
Custodian 9,906
Miscellaneous 4,879
----------
Total expenses 450,958
Less expenses borne by investment
adviser (51,919)
----------
Net expenses 399,039
----------
NET INVESTMENT LOSS (275,816)
----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain on securities 2,299,388
Net change in unrealized appreciation
(depreciation) on investments 2,415,950
----------
NET GAIN ON INVESTMENTS 4,715,338
----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $4,439,522
==========
</TABLE>
See Notes to Financial Statements 27
<PAGE>
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
9/30/99 9/30/98
----------- -----------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss) $ (275,816) $ (201,569)
Net realized gain (loss) 2,299,388 895,515
Net change in unrealized appreciation (depreciation) 2,415,950 (1,612,591)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS 4,439,522 (918,645)
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net realized gains, Class X (355,856) (1,092,044)
Net realized gains, Class A (166,088) (289,481)
Net realized gains, Class B (11,063) --
Net realized gains, Class C (9,446) --
----------- -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (542,453) (1,381,525)
----------- -----------
FROM SHARE TRANSACTIONS
CLASS X
Proceeds from sales of shares (143,563 and 135,008 shares,
respectively) 2,478,919 2,127,609
Net asset value of shares issued from reinvestment of
distributions
(21,703 and 84,041 shares, respectively) 354,621 1,090,132
Cost of shares repurchased (214,035 and 142,018 shares,
respectively) (3,757,537) (2,045,120)
----------- -----------
Total (923,997) 1,172,621
----------- -----------
CLASS A
Proceeds from sales of shares (228,931 and 159,888 shares,
respectively) 3,836,768 2,538,940
Net asset value of shares issued from reinvestment of
distributions
(10,097 and 22,073 shares, respectively) 163,976 286,061
Cost of shares repurchased (138,776 and 62,130 shares,
respectively) (2,331,488) (947,854)
----------- -----------
Total 1,669,256 1,877,147
----------- -----------
CLASS B
Proceeds from sales of shares (86,897 and 10,599 shares,
respectively) 1,460,274 169,635
Net asset value of shares issued from reinvestment of
distributions
(684 and 0 shares, respectively) 11,062 --
Cost of shares repurchased (1,900 and 0 shares,
respectively) (31,603) --
----------- -----------
Total 1,439,733 169,635
----------- -----------
CLASS C
Proceeds from sales of shares (49,078 and 7,538 shares,
respectively) 821,159 125,992
Net asset value of shares issued from reinvestment of
distributions
(402 and 0 shares, respectively) 6,510 --
Cost of shares repurchased (991 and 0 shares,
respectively) (16,970) --
----------- -----------
Total 810,699 125,992
----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS 2,995,691 3,345,395
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS 6,892,760 1,045,225
NET ASSETS
Beginning of period 12,854,924 11,809,699
----------- -----------
END OF PERIOD [INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF
$0 AND $0, RESPECTIVELY] $19,747,684 $12,854,924
=========== ===========
</TABLE>
28 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS X
-----------------------------------------------------------
FROM
YEAR ENDED SEPTEMBER 30 INCEPTION
-------------------------------------------- 3/8/96 TO
1999 1998 1997 9/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 13.81 $ 16.47 $ 14.97 $ 10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.21)(1) (0.23)(1)(2) (0.17)(2) 0.01(2)
Net realized and unrealized gain
(loss) 4.72 (0.58) 1.84 4.96
------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS 4.51 (0.81) 1.67 4.97
------- ------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- (0.07) --
Dividends from net realized gains (0.54) (1.85) (0.10) --
------- ------- ------- -------
TOTAL DISTRIBUTIONS (0.54) (1.85) (0.17) --
------- ------- ------- -------
Change in net asset value 3.97 (2.66) 1.50 4.97
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 17.78 $ 13.81 $ 16.47 $ 14.97
======= ======= ======= =======
Total return(3) 33.02 % (4.22) % 11.39 % 49.70%(5)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $10,640 $ 8,940 $ 9,390 $ 7,428
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.96 % 2.10 %(6) 1.74 %(6) 0.90%(4)(6)
Net investment income (loss) (1.27)% (1.49)% (0.97) % 0.27%(4)
Portfolio turnover 192 % 206 % 283.60 % 72.34%(5)
</TABLE>
(1) Computed using average shares outstanding.
(2) Net investment income (loss) is after waiver of certain fees and
reimbursement of certain expenses by the investment adviser. If the
investment adviser had not waived fees and reimbursed expenses, net
investment income (loss) per share would have been $(0.27), $(0.33) and
$(0.19) for the years ended September 30, 1998 and 1997 and the period ended
September 30, 1996, respectively.
(3) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(4) Annualized.
(5) Not annualized.
(6) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.38%,
2.77% and 5.73% for the years ended September 30, 1998 and 1997 and the
period ended September 30, 1996, respectively.
See Notes to Financial Statements 29
<PAGE>
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS A
-----------------------------------------------------------
FROM
YEAR ENDED SEPTEMBER 30 INCEPTION
-------------------------------------------- 3/8/96 TO
1999 1998 1997 9/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 13.75 $ 16.49 $ 14.94 $ 10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.31)(1) (0.30)(1)(2) (0.25)(2) (0.01)(2)
Net realized and unrealized gain
(loss) 4.70 (0.59) 1.90 4.95
------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS 4.39 (0.89) 1.65 4.94
------- ------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- -- --
Dividends from net realized gains (0.54) (1.85) (0.10) --
------- ------- ------- -------
TOTAL DISTRIBUTIONS (0.54) (1.85) (0.10) --
------- ------- ------- -------
Change in net asset value 3.85 (2.74) 1.55 4.94
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 17.60 $ 13.75 $ 16.49 $ 14.94
======= ======= ======= =======
Total return(3) 32.27 % (4.74) % 11.25 % 49.30 %(5)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 6,457 $ 3,666 $ 2,419 $ 1,355
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.51 % 2.70 %(6) 2.37 %(6) 1.55 %(4)(6)
Net investment income (loss) (1.81) % (1.95) % (1.60) % (0.46) %(4)
Portfolio turnover 192 % 206 % 283.60 % 72.34 %(5)
</TABLE>
(1) Computed using average shares outstanding.
(2) Net investment income (loss) is after waiver of certain fees and
reimbursement of certain expenses by the investment adviser. If the
investment adviser had not waived fees and reimbursed expenses, net
investment income (loss) per share would have been $(0.31), $(0.55) and
$(0.20) for the years ended September 30, 1998 and 1997 and the period ended
September 30, 1996, respectively.
(3) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(4) Annualized.
(5) Not annualized.
(6) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.74%,
4.32% and 9.73% for the years ended September 30, 1998 and 1997 and the
period ended September 30, 1996, respectively.
30 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Mid-Cap "EDGE"-SM- Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS B CLASS C
----------------------------- ------------------------------
FROM FROM
YEAR INCEPTION YEAR INCEPTION
ENDED 7/1/98 TO ENDED 7/1/98 TO
9/30/99 9/30/98 9/30/99 9/30/98
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 13.73 $ 17.15 $ 13.72 $ 17.15
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.47)(1)(2) (0.09)(1)(2) (0.47)(1)(3) (0.09)(1)(3)
Net realized and unrealized gain
(loss) 4.69 (3.33) 4.69 (3.34)
------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS 4.22 (3.42) 4.22 (3.43)
------- ------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- -- --
Dividends from net realized gains (0.54) -- (0.54) --
------- ------- ------- -------
TOTAL DISTRIBUTIONS (0.54) -- (0.54) --
------- ------- ------- -------
Change in net asset value 3.68 (3.42) 3.68 (3.43)
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 17.41 $ 13.73 $ 17.40 $ 13.72
======= ======= ======= =======
Total return(4) 31.05 % (19.94)%(6) 31.07 % (20.00)%(6)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $1,676 $145 $975 $103
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 3.45 %(7) 3.45 %(5)(7) 3.45 %(8) 3.45 %(5)(8)
Net investment income (loss) (2.78)% (2.45)%(5) (2.78)% (2.44)%(5)
Portfolio turnover 192 % 206 %(6) 192 % 206 %(6)
</TABLE>
(1) Computed using average shares outstanding.
(2) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $(0.96) and $(0.69) for the periods ended September
30, 1999 and September 30, 1998, respectively.
(3) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $(1.40) and $(0.77) for the periods ended September
30, 1999 and September 30, 1998, respectively.
(4) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(5) Annualized.
(6) Not annualized.
(7) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 6.33% and
20.80% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
(8) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 9.03% and
21.14% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
See Notes to Financial Statements 31
<PAGE>
PHOENIX-SENECA REAL ESTATE SECURITIES FUND
A DISCUSSION WITH THE FUND'S PORTFOLIO MANAGERS, GAIL P. SENECA, PH.D.,
AND DAVID SHAPIRO, J.D.
Q: WHAT IS THE INVESTMENT OBJECTIVE OF THE FUND?
A: The Phoenix-Seneca Real Estate Securities Fund seeks high total return, both
current income and capital appreciation, through investments in Real Estate
Investment Trusts (REITs) and real estate-related securities. Investors should
note that real estate investing involves certain risks, such as refinancing,
economic impact on the industry, changes in property values, dependency on
management skills, and risks similar to those of small-company investing.
Q: HOW DID THE FUND PERFORM OVER THE LAST 12 MONTHS?
A: For the fiscal year ended September 30, 1999, Class A shares returned
(7.97)%, Class B shares returned (8.59)%, Class C shares returned (8.58)%, and
Class X shares returned (6.66)% compared with a return of (4.73)% for the
Wilshire REIT Index(1). All performance figures assume reinvestment of
distributions and exclude the effect of sales charges.
Q: HOW IS THE PORTFOLIO CURRENTLY POSITIONED?
A: With the underlying economy strong, we look for the fundamentals of real
estate to remain positive. Our investment strategy is a two-pronged approach.
Instead of focusing on the various real estate sectors to maximize returns, we
will seek to own companies with strong management and dominant market positions,
such as Equity Residential, Spieker Properties, and value stocks with solid
market niches and savvy management, such as Essex, Pacific Gulf, and Macerich.
While real estate fundamentals at the operating level remain excellent, the
public markets for real estate company stocks have been in a steady decline. We
believe this disconnect between the public and private market for real estate is
an opportunity to focus on the arbitrage opportunities. Accordingly, we will
look to own quality companies that are selling at substantial discounts to their
net asset value.
OCTOBER 19, 1999
(1) THE WILSHIRE REIT INDEX IS AN UNMANAGED, COMMONLY USED MEASURE OF TOTAL
RETURN PERFORMANCE OF PUBLICLY TRADED REAL ESTATE EQUITY. THE INDEX IS
COMPRISED OF COMPANIES WHOSE CHARTER IS THE EQUITY OWNERSHIP AND OPERATION
OF COMMERCIAL REAL ESTATE. THE INDEX IS NOT AVAILABLE FOR DIRECT INVESTMENT
AND IS CALCULATED MONTHLY RATHER THAN DAILY.
32
<PAGE>
Phoenix-Seneca Real Estate Securities Fund
AVERAGE ANNUAL TOTAL RETURNS(1) PERIOD ENDING 9/30/99
<TABLE>
<CAPTION>
INCEPTION INCEPTION
1 YEAR TO 9/30/99 DATE
-------- ----------- ---------
<S> <C> <C> <C>
Class X Shares at NAV(2) (6.66)% 4.33% 3/12/96
Class A Shares at NAV(2) (7.97) 3.14 3/12/96
Class A Shares at POP(3) (12.34) 1.74 3/12/96
Class B Shares at NAV(2) (8.59) (15.96) 7/1/98
Class B Shares with CDSC(4) (12.06) (18.51) 7/1/98
Class C Shares at NAV(2) (8.58) (15.96) 7/1/98
Class C Shares with CDSC(4) (8.58) (15.96) 7/1/98
Wilshire REIT Index(7) (4.73) Note 5 Note 5
</TABLE>
(1) Total returns are historical and include changes in share price and the
reinvestment of both dividends and capital gains distributions.
(2) "NAV" (Net Asset Value) total returns do not include the effect of any
sales charge.
(3) "POP" (Public Offering Price) total returns include the effect of the
maximum front-end 4.75% sales charge.
(4) CDSC (contingent deferred sales charge) is applied to redemptions of
certain classes of shares that do not have a sales charge applied at the
time of purchase. CDSC charges for B shares decline from 5% to 0% over a
five year period. CDSC charges for C shares are 1% in the first year and 0%
thereafter.
(5) Index performance is 7.52% for Class X and Class A (since 3/29/96) and
(12.07)% for Class B and Class C (since 6/30/98).
(6) This chart illustrates NAV returns on Class X shares and POP returns on
Class A shares. Returns on Class B and Class C shares will vary due to
differing sales charges.
(7) The Wilshire REIT Index is an unmanaged, commonly used measure of total
return performance of publicly traded real estate equity. The index's
performance does not reflect sales charges.
All returns represent past performance which may not be indicative of
future performance. The investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
GROWTH OF $10,000 PERIODS ENDING 9/30
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PHOENIX-SENECA REAL ESTATE PHOENIX-SENECA REAL ESTATE WILSHIRE
SECURITIES FUND CLASS X AT SECURITIES FUND CLASS A AT REIT
NAV(6) POP(3) INDEX(7)
<S> <C> <C> <C>
3/96 $10,000 $9,525 $10,000
96 $11,261 $10,669 $11,111
97 $15,252 $14,353 $15,800
98 $12,456 $11,551 $13,538
99 $11,626 $10,631 $12,897
</TABLE>
This Growth of $10,000 chart assumes an initial investment of $10,000 made on
3/12/96 (inception of the Fund) in Class X and A shares. The total return for
Class X shares reflects no sales charge. The total return for Class A shares
reflects the maximum sales charge of 4.75% on the initial investment.
Performance assumes dividends and capital gains are reinvested. The performance
of other share classes will be greater or less than that shown based on
differences in inception dates, fees and sales charges.
SECTOR WEIGHTINGS 9/30/99
As a percentage of equity holdings
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Office 26%
Apartments 21
Regional Malls 12
Diversified 11
Lodging/Resorts 8
Industrial 8
Manufactured Homes 7
Other 7
</TABLE>
33
<PAGE>
Phoenix-Seneca Real Estate Securities Fund
TEN LARGEST HOLDINGS AT SEPTEMBER 30, 1999 (AS A PERCENTAGE OF NET ASSETS)
<TABLE>
<C> <S> <C>
1. Equity Residential Properties Trust 6.4%
APARTMENT REIT
2. Essex Property Trust, Inc. 6.3%
APARTMENT REIT
3. Equity Office Properties Trust 5.6%
OFFICE REIT
4. Macerich Co. (The) 4.8%
REGIONAL MALL REIT
5. Mack-Cali Realty Corp. 4.7%
OFFICE REIT
6. Urban Shopping Centers, Inc. 4.7%
REGIONAL MALL REIT
7. Pacific Gulf Properties, Inc. 4.4%
DIVERSIFIED REIT
8. Manufactured Home Communities, Inc. 4.2%
MANUFACTURED HOMES REIT
9. Spieker Properties, Inc. 4.1%
OFFICE REIT
10. Cornerstone Properties, Inc. 4.0%
OFFICE REIT
</TABLE>
INVESTMENTS AT SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
COMMON STOCKS--92.3%
REAL ESTATE INVESTMENT TRUSTS--90.5%
DIVERSIFIED--7.9%
Crescent Real Estate Equities Co........ 26,000 $ 468,000
Entertainment Properties Trust.......... 12,000 175,500
Pacific Gulf Properties, Inc............ 41,290 823,219
-----------
1,466,719
-----------
INDUSTRIAL/OFFICE--34.2%
INDUSTRIAL--7.0%
Bedford Property Investors, Inc......... 41,600 702,000
First Industrial Realty Trust, Inc...... 24,500 606,375
-----------
1,308,375
-----------
MIXED--2.5%
TriNet Corporate Realty Trust, Inc...... 19,500 464,344
MORTGAGE BACKED--2.7%
Northstar Financial Corp.(b)(c)......... 35,000 507,500
OFFICE--22.0%
Cornerstone Properties, Inc............. 48,500 739,625
Equity Office Properties Trust.......... 45,100 1,048,575
Mack-Cali Realty Corp................... 32,800 879,450
Prentiss Properties Trust............... 30,400 674,500
Spieker Properties, Inc................. 22,000 763,125
-----------
4,105,275
-----------
- ------------------------------------------------------------------
TOTAL INDUSTRIAL/ OFFICE 6,385,494
- ------------------------------------------------------------------
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
LODGING/RESORTS--8.0%
FelCor Lodging Trust, Inc............... 37,275 $ 652,312
MeriStar Hospitality Corp............... 27,374 417,454
Starwood Hotel & Resorts Worldwide,
Inc..................................... 16,000 357,000
Sunstone Hotel Investors, Inc........... 7,510 65,713
-----------
1,492,479
-----------
RESIDENTIAL--27.4%
APARTMENTS--20.3%
Archstone Communities Trust............. 32,996 637,235
Avalonbay Communities, Inc.............. 15,750 533,531
Berkshire Realty Co., Inc............... 21,200 254,400
Equity Residential Properties Trust..... 28,200 1,194,975
Essex Property Trust, Inc............... 33,450 1,168,659
-----------
3,788,800
-----------
MANUFACTURED HOMES--7.1%
Chateau Communities, Inc................ 20,700 538,200
Manufactured Home Communities, Inc...... 33,200 776,050
-----------
1,314,250
-----------
- ------------------------------------------------------------------
TOTAL RESIDENTIAL 5,103,050
- ------------------------------------------------------------------
RETAIL--13.0%
REGIONAL MALLS--11.9%
Macerich Co. (The)...................... 38,400 888,000
Simon Property Group, Inc............... 20,415 458,062
Urban Shopping Centers, Inc............. 30,000 870,000
-----------
2,216,062
-----------
</TABLE>
34 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Real Estate Securities Fund
<TABLE>
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
STRIP CENTERS--1.1%
Developers Diversified Realty Corp...... 15,200 $ 212,800
- ------------------------------------------------------------------
TOTAL RETAIL 2,428,862
- ------------------------------------------------------------------
TOTAL REAL ESTATE INVESTMENT TRUSTS
(IDENTIFIED COST $20,311,794) 16,876,604
- ------------------------------------------------------------------
REAL ESTATE OPERATING COMPANIES--1.8%
DIVERSIFIED--0.2%
Catellus Development Corp.(b)........... 2,400 28,200
INDUSTRIAL/OFFICE--0.8%
Capital Trust Class A(b)................ 31,500 155,531
LODGING/RESORTS--0.8%
Wyndham International, Inc. Class
A(b).................................... 58,538 153,662
- ------------------------------------------------------------------
TOTAL REAL ESTATE OPERATING COMPANIES
(IDENTIFIED COST $1,663,782) 337,393
- ------------------------------------------------------------------
TOTAL COMMON STOCKS
(IDENTIFIED COST $21,975,576) 17,213,997
- ------------------------------------------------------------------
<CAPTION>
SHARES VALUE
------- -----------
<S> <C> <C> <C>
CONVERTIBLE PREFERRED STOCKS--6.1%
REAL ESTATE INVESTMENT TRUSTS--6.1%
DIVERSIFIED--2.9%
Glenborough Realty Trust, Inc. Series A
Cv. Pfd. 7.75%.......................... 32,550 $ 535,041
INDUSTRIAL/OFFICE--3.2%
MIXED--3.2%
Reckson Associates Realty Corp. Series A
Cv. Pfd. 7.625%......................... 30,000 605,625
- ------------------------------------------------------------------
TOTAL REAL ESTATE INVESTMENT TRUSTS
(IDENTIFIED COST $1,470,254) 1,140,666
- ------------------------------------------------------------------
TOTAL CONVERTIBLE PREFERRED STOCKS
(IDENTIFIED COST $1,470,254) 1,140,666
- ------------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C> <C> <C>
TOTAL INVESTMENTS--98.4%
(IDENTIFIED COST $23,445,830) 18,354,663(a)
Cash and receivables, less liabilities--1.6% 307,360
-----------
NET ASSETS--100.0% $18,662,023
===========
</TABLE>
(a) Federal Income Tax Information: Net unrealized depreciation of investment
securities is comprised of gross appreciation of $312,920 and gross
depreciation of $5,404,087 for federal income tax purposes. At
September 30, 1999, the aggregate cost of securities for federal income tax
purposes was $23,445,830.
(b) Non-income producing.
(c) Private Placement.
See Notes to Financial Statements
35
<PAGE>
Phoenix-Seneca Real Estate Securities Fund
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1999
<TABLE>
<S> <C>
ASSETS
Investment securities at value
(Identified cost $23,445,830) $18,354,663
Receivables
Dividends and interest 206,542
Investment securities sold 178,563
Deferred organization expenses 13,527
Prepaid expenses 2,149
-----------
Total assets 18,755,444
-----------
LIABILITIES
Payables
Custodian 8,309
Fund shares repurchased 12,372
Transfer agent fee 12,008
Investment advisory fee 7,839
Financial agent fee 5,199
Distribution fee 1,681
Trustees' fee 913
Accrued expenses 45,100
-----------
Total liabilities 93,421
-----------
NET ASSETS $18,662,023
===========
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial
interest $24,193,732
Undistributed net investment income 223,188
Accumulated net realized loss (663,730)
Net unrealized depreciation (5,091,167)
-----------
NET ASSETS $18,662,023
===========
CLASS X
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$17,346,011) 1,789,967
Net asset value and offering price per share $9.69
CLASS A
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$918,535) 96,249
Net asset value per share $9.54
Offering price per share $9.54/(1-4.75%) $10.02
CLASS B
Shares of beneficial interest outstanding,
$1 par value,
unlimited authorization (Net Assets
$197,438) 20,676
Net asset value and offering price per share $9.55
CLASS C
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization (Net Assets $200,039) 20,955
Net asset value and offering price per share $9.55
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED SEPTEMBER 30, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME
Dividends $ 1,304,610
Interest 13,214
-----------
Total investment income 1,317,824
-----------
EXPENSES
Investment advisory fee 181,649
Distribution fee, Class A 2,743
Distribution fee, Class B 1,715
Distribution fee, Class C 1,571
Financial agent fee 55,598
Transfer agent 77,424
Registration 36,379
Trustees 25,773
Professional 17,224
Printing 14,720
Amortization of deferred
organization expenses 10,658
Custodian 5,358
Miscellaneous 10,670
-----------
Total expenses 441,482
Less expenses borne by
investment adviser (63,940)
-----------
Net expenses 377,542
-----------
NET INVESTMENT INCOME 940,282
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized loss on securities (655,001)
Net change in unrealized
appreciation (depreciation) on
investments (1,715,439)
-----------
NET LOSS ON INVESTMENTS (2,370,440)
-----------
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS $(1,430,158)
===========
</TABLE>
36 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Real Estate Securities Fund
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
9/30/99 9/30/98
------------- -------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss) $ 940,282 $ 1,139,214
Net realized gain (loss) (655,001) 551,625
Net change in unrealized appreciation (depreciation) (1,715,439) (7,262,351)
----------- -----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS (1,430,158) (5,571,512)
----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income, Class X (837,674) (927,830)
Net investment income, Class A (38,060) (63,404)
Net investment income, Class B (4,962) (523)
Net investment income, Class C (3,646) (508)
Net realized gains, Class X (499,713) (1,123,456)
Net realized gains, Class A (30,097) (124,174)
Net realized gains, Class B (4,310) --
Net realized gains, Class C (2,368) --
----------- -----------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (1,420,830) (2,239,895)
----------- -----------
FROM SHARE TRANSACTIONS
CLASS X
Proceeds from sales of shares (210,923 and 190,605 shares,
respectively) 2,123,311 2,502,892
Net asset value of shares issued from reinvestment of
distributions
(132,293 and 153,188 shares, respectively) 1,320,535 2,018,886
Cost of shares repurchased (515,264 and 297,712 shares,
respectively) (5,249,668) (3,754,823)
----------- -----------
Total (1,805,822) 766,955
----------- -----------
CLASS A
Proceeds from sales of shares (21,611 and 31,969 shares,
respectively) 225,249 436,921
Net asset value of shares issued from reinvestment of
distributions
(6,494 and 13,501 shares, respectively) 64,196 179,472
Cost of shares repurchased (55,264 and 138,471 shares,
respectively) (559,210) (1,815,501)
----------- -----------
Total (269,765) (1,199,108)
----------- -----------
CLASS B
Proceeds from sales of shares (11,520 and 8,978 shares,
respectively) 120,191 113,001
Net asset value of shares issued from reinvestment of
distributions
(933 and 47 shares, respectively) 9,271 523
Cost of shares repurchased (0 and 802 shares,
respectively) -- (9,281)
----------- -----------
Total 129,462 104,243
----------- -----------
CLASS C
Proceeds from sales of shares (12,513 and 7,932 shares,
respectively) 124,671 100,250
Net asset value of shares issued from reinvestment of
distributions
(589 and 46 shares, respectively) 5,859 506
Cost of shares repurchased (125 and 0 shares,
respectively) (1,280) --
----------- -----------
Total 129,250 100,756
----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS (1,816,875) (227,154)
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS (4,667,863) (8,038,561)
NET ASSETS
Beginning of period 23,329,886 31,368,447
----------- -----------
END OF PERIOD [INCLUDING UNDISTRIBUTED NET INVESTMENT
INCOME (LOSS) OF
$223,188 AND $169,785, RESPECTIVELY] $18,662,023 $23,329,886
=========== ===========
</TABLE>
See Notes to Financial Statements 37
<PAGE>
Phoenix-Seneca Real Estate Securities Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS X
-------------------------------------------------------
FROM
YEAR ENDED SEPTEMBER 30, INCEPTION
--------------------------------------- 3/12/96 TO
1999 1998 1997 9/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of
period $ 11.11 $ 14.71 $ 11.10 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) 0.47(6) 0.54 0.13(1) 0.13(1)
Net realized and unrealized gain
(loss) (1.20) (3.10) 3.77 1.10
------- ------- ------- --------
TOTAL FROM INVESTMENT
OPERATIONS (0.73) (2.56) 3.90 1.23
------- ------- ------- --------
LESS DISTRIBUTIONS
Dividends from net investment
income (0.44) (0.46) (0.28) (0.13)
Dividends from net realized gains (0.25) (0.58) (0.01) --
------- ------- ------- --------
TOTAL DISTRIBUTIONS (0.69) (1.04) (0.29) (0.13)
------- ------- ------- --------
Change in net asset value (1.42) (3.60) 3.61 1.10
------- ------- ------- --------
NET ASSET VALUE, END OF PERIOD $ 9.69 $ 11.11 $ 14.71 $ 11.10
======= ======= ======= ========
Total return(2) (6.66)% (18.33)% 35.44% 12.39%(4)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(thousands) $17,346 $21,794 $28,193 $ 1,073
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.66 % 1.47 % 1.99%(5) 1.00%(3)(5)
Net investment income (loss) 4.50 % 4.14 % 2.38% 4.39%(3)
Portfolio turnover 5 % 53 % 75.68% 30.70%(4)
</TABLE>
(1) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $0.13 and $(1.45) for the year ended September 30,
1997 and the period ended September 30, 1996, respectively.
(2) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(3) Annualized.
(4) Not annualized.
(5) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.99% and
53.04% for the year ended September 30, 1997 and the period ended September
30, 1996, respectively.
(6) Computed using average shares outstanding.
38
See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Real Estate Securities Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS A
-------------------------------------------------------------
FROM
YEAR ENDED SEPTEMBER 30, INCEPTION
--------------------------------------------- 3/12/96 TO
1999 1998 1997 9/30/96
<S> <C> <C> <C> <C>
Net asset value, beginning of
period $ 11.00 $ 14.68 $ 11.08 $ 10.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) 0.32(1)(6) 0.35 0.03(1) 0.13(1)
Net realized and unrealized gain
(loss) (1.19) (3.08) 3.78 1.08
------- ------- ------- -------
TOTAL FROM INVESTMENT
OPERATIONS (0.87) (2.73) 3.81 1.21
------- ------- ------- -------
LESS DISTRIBUTIONS
Dividends from net investment
income (0.34) (0.37) (0.20) (0.13)
Dividends from net realized gains (0.25) (0.58) (0.01) --
------- ------- ------- -------
TOTAL DISTRIBUTIONS (0.59) (0.95) (0.21) (0.13)
------- ------- ------- -------
Change in net asset value (1.46) (3.68) 3.60 1.08
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD $ 9.54 $ 11.00 $ 14.68 $ 11.08
======= ======= ======= =======
Total return(2) (7.97)% (19.52)% 34.54% 12.22%(4)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(thousands) $ 919 $ 1,357 $ 3,176 $ 222
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 3.05 %(5) 2.76 % 2.91%(5) 1.65%(3)(5)
Net investment income (loss) 3.13 % 2.45 % 1.37% 4.61%(3)
Portfolio turnover 5 % 53 % 75.68% 30.70%(4)
</TABLE>
(1) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $0.20, $(0.04) and $(1.96) for the years ended
September 30, 1999 and 1997 and the period ended September 30, 1996,
respectively.
(2) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(3) Annualized.
(4) Not annualized.
(5) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 4.27%,
3.79% and 73.01% for the years ended September 30, 1999 and 1997 and the
period ended September 30, 1996, respectively.
(6) Computed using average shares outstanding.
See Notes to Financial Statements
39
<PAGE>
Phoenix-Seneca Real Estate Securities Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS B CLASS C
------------------------------ ------------------------------
FROM FROM
YEAR INCEPTION YEAR INCEPTION
ENDED 7/1/98 TO ENDED 7/1/98 TO
9/30/99 9/30/98 9/30/99 9/30/98
<S> <C> <C> <C> <C>
Net asset value, beginning of
period $11.01 $12.58 $11.01 $12.58
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) 0.29(1)(8) 0.07(1) 0.29(2)(8) 0.07(2)
Net realized and unrealized gain (1.22) (1.58) (1.22) (1.58)
------ ------ ------ ------
TOTAL FROM INVESTMENT
OPERATIONS (0.93) (1.51) (0.93) (1.51)
------ ------ ------ ------
LESS DISTRIBUTIONS:
Dividends from net investment
income (0.28) (0.06) (0.28) (0.06)
Dividends from net realized gains (0.25) -- (0.25) --
------ ------ ------ ------
TOTAL DISTRIBUTIONS (0.53) (0.06) (0.53) (0.06)
------ ------ ------ ------
Change in net asset value (1.46) (1.57) (1.46) (1.57)
------ ------ ------ ------
NET ASSET VALUE, END OF PERIOD $ 9.55 $11.01 $ 9.55 $11.01
====== ====== ====== ======
Total return(3) (8.59)% (11.97)%(5) (8.58)% (11.97)%(5)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(thousands) $197 $91 $200 $88
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 3.80 %(6) 3.80 %(4)(6) 3.80 %(7) 3.80 %(4)(7)
Net investment income (loss) 2.79 % 2.50 %(4) 2.80 % 2.44 %(4)
Portfolio turnover 5 % 53 %(5) 5 % 53 %(5)
</TABLE>
(1) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $(1.23) and $(0.46) for the periods ended
September 30, 1999 and September 30, 1998, respectively.
(2) Net investment income is after waiver of certain fees and reimbursement of
certain expenses by the investment adviser. If the investment adviser had
not waived fees and reimbursed expenses, net investment income (loss) per
share would have been $(1.39) and $(0.48) for the periods ended
September 30, 1999 and September 30, 1998, respectively.
(3) Total return represents total return for the period indicated. The total
return would have been lower if certain fees and expenses had not been
waived or reimbursed by the investment adviser.
(4) Annualized.
(5) Not annualized.
(6) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 18.50%
and 22.08% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
(7) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 19.95%
and 22.93% for the periods ended September 30, 1999 and September 30, 1998,
respectively.
(8) Computed using average shares outstanding.
40
See Notes to Financial Statements
<PAGE>
PHOENIX-SENECA FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1999
1. SIGNIFICANT ACCOUNTING POLICIES
The Phoenix-Seneca Funds (the "Trust") is organized as a Delaware business
trust and is registered under the Investment Company Act of 1940, as amended, as
a diversified, open-end management investment company. Shares of the Trust are
divided into four series, each a "Fund" and collectively the "Funds" as follows:
Phoenix-Seneca Bond Fund, Phoenix-Seneca Growth Fund, Phoenix-Seneca Mid-Cap
"EDGE"-SM- Fund and Phoenix-Seneca Real Estate Securities Fund (formerly Seneca
Bond Fund, Seneca Growth Fund, Seneca Mid-Cap "EDGE"-SM- Fund and Seneca Real
Estate Securities Fund, respectively). Each Fund has distinct investment
objectives. Bond Fund seeks to generate a high level of current income and
capital appreciation. Growth Fund seeks to achieve long-term capital
appreciation. Mid-Cap "EDGE"-SM- Fund seeks to achieve long-term capital
appreciation by investing primarily in a diversified portfolio of equity
securities of companies with market capitalizations between $500 million and $5
billion. Real Estate Securities Fund seeks to emphasize capital appreciation and
income equally by investing primarily in marketable securities of
publicly-traded real estate investment trusts (REITS) and companies that invest
in, operate, develop and/or manage real estate located in the United States.
Each Fund offers Class X (formerly Seneca Institutional), Class A (formerly
Seneca Administrative), Class B and Class C shares. Class X shares are sold
without a sales charge. Class A shares are sold with a front-end sales charge of
up to 4.75%. Class B shares are sold with a contingent deferred sales charge
which declines from 5% to zero depending on the period of time the shares are
held. Class C shares are sold with a 1% contingent deferred sales charge if
redeemed within one year of purchase. All classes of shares have identical
voting, dividend, liquidation and other rights and the same terms and
conditions, except that Class A, Class B and Class C shares bear distribution
expenses and have exclusive voting rights with respect to their distribution
plans. Investment income and realized and unrealized gains/losses are allocated
among the classes on the basis of net assets of each class. Expenses that relate
to the distribution of shares or services provided to a particular class are
allocated to that class.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets, liabilities, revenues and expenses.
Actual results could differ from those estimates.
A. SECURITY VALUATION:
Equity securities are valued at the last sale price, or if there had been no
sale that day, at the mean between the most recent high bid and the most recent
low asked quotations. Debt securities are valued on the basis of broker
quotations or valuations provided by a pricing service which utilizes
information with respect to recent sales, market transactions in comparable
securities, quotations from dealers and various relationships between securities
in determining value. Short-term investments having a remaining maturity of 60
days or less are valued at amortized cost which approximates market. All other
securities and assets are valued at their fair value as determined in good faith
by or under the direction of the Trustees.
B. SECURITY TRANSACTIONS AND RELATED INCOME:
Security transactions are recorded on the trade date. Dividend income is
recorded on the ex-dividend date or, in the case of certain foreign securities,
as soon as the Fund is notified. Interest income is recorded on the accrual
basis. The Trust amortizes premiums and discounts using the effective interest
method. Realized gains and losses are determined on the identified cost basis.
C. INCOME TAXES:
Each Fund is treated as a separate taxable entity. It is the policy of each
Fund to comply with the requirements of the Internal Revenue Code (the "Code")
applicable to regulated investment companies, and to distribute all of its
taxable income to its shareholders. In addition, each Fund intends to distribute
an amount sufficient to avoid imposition of any excise tax under Section 4982 of
the Code. Therefore, no provision for federal income taxes or excise taxes has
been made.
D. DISTRIBUTIONS TO SHAREHOLDERS:
Distributions are recorded by each Fund on the ex-dividend date. Income and
capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences include the treatment of non-taxable dividends, market
discount, organization costs, expiring capital loss carryforwards, foreign
currency gain/loss, partnerships, operating losses and losses deferred due to
wash sales and excise tax regulations. Permanent book and tax basis differences
relating to shareholder distributions will result in reclassifications to paid
in capital.
E. FOREIGN CURRENCY TRANSLATION:
Foreign securities and other assets and liabilities are valued using the
foreign currency exchange rate effective at the end of the reporting period.
Cost of investments is translated at the currency exchange rate
41
<PAGE>
PHOENIX-SENECA FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1999 (CONTINUED)
effective at the trade date. The gain or loss resulting from a change in
currency exchange rates between the trade and settlement dates of a portfolio
transaction is treated as a gain or loss on foreign currency. Likewise, the gain
or loss resulting from a change in currency exchange rates between the date
income is accrued and paid is treated as a gain or loss on foreign currency. The
Trust does not separate that portion of the results of operations arising from
changes in exchange rates and that portion arising from changes in the market
prices of securities.
F. FORWARD CURRENCY CONTRACTS:
Each Fund may enter into forward currency contracts in conjunction with the
planned purchase or sale of foreign denominated securities in order to hedge the
U.S. dollar cost or proceeds. Forward currency contracts involve, to varying
degrees, elements of market risk in excess of the amount recognized in the
statement of assets and liabilities. Risks arise from the possible movements in
foreign exchange rates or if the counterparty does not perform under the
contract.
A forward currency contract involves an obligation to purchase or sell a
specific currency at a future date, which may be any number of days from the
date of the contract agreed upon by the parties, at a price set at the time of
the contract. These contracts are traded directly between currency traders and
their customers. The contract is marked-to-market daily and the change in market
value is recorded by each Fund as an unrealized gain (or loss). When the
contract is closed or offset with the same counterparty, the Fund records a
realized gain (or loss) equal to the change in the value of the contract when it
was opened and the value at the time it was closed or offset.
G. OPTIONS:
Each Fund may write covered options or purchase options contracts for the
purpose of hedging against changes in the market value of the underlying
securities or foreign currencies.
Each Fund will realize a gain or loss upon the expiration or closing of the
option transaction. Gains and losses on written options are reported separately
in the Statement of Operations. When a written option is exercised, the proceeds
on sales or amounts paid are adjusted by the amount of premium received. Options
written are reported as a liability in the Statement of Assets and Liabilities
and subsequently marked-to-market to reflect the current value of the option.
The risk associated with written options is that the change in value of options
contracts may not correspond to the change in value of the hedged instruments.
In addition, losses may arise from changes in the value of the underlying
instruments, or if a liquid secondary market does not exist for the contracts.
Each Fund may purchase options which are included in the Funds' Schedule of
Investments and subsequently marked-to-market to reflect the current value of
the option. When a purchased option is exercised, the cost of the security is
adjusted by the amount of premium paid. The risk associated with purchased
options is limited to the premium paid.
H. ORGANIZATION EXPENSE:
In 1996, the Trust incurred organizational expenses which are amortized on a
straight line basis over a period of sixty months from the commencement of
operations. If any of the initial shares are redeemed before the end of the
amortization period, the proceeds of the redemption will be reduced by the pro
rata share of unamortized organization expenses.
I. EXPENSES:
Trust expenses not directly attributable to a specific Fund are allocated
evenly among all funds. Fund expenses that are not related to the distribution
of shares of a particular class or to services provided specifically to a
particular class are allocated among the classes on the basis of relative
average daily net assets of each class.
J. REPURCHASE AGREEMENTS:
A repurchase agreement is a transaction where a Fund acquires a security for
cash and obtains a simultaneous commitment from the seller to repurchase the
security at an agreed upon price and date. Each Fund, through its custodian,
takes possession of securities collateralizing the repurchase agreement. The
collateral is marked-to-market daily to ensure that the market value of the
underlying assets remains sufficient to protect the Fund in the event of default
by the seller. If the seller defaults and the value of the collateral declines,
or if the seller enters insolvency proceedings, realization of collateral may be
delayed or limited.
2. INVESTMENT ADVISORY FEE AND RELATED PARTY TRANSACTIONS
Phoenix Investment Counsel, Inc, ("PIC" or the "Adviser") serves as investment
adviser to the Phoenix-Seneca Funds and Seneca Capital Management LLC ("Seneca"
or the "Subadviser") serves as investment subadviser. All of the outstanding
stock of PIC and a majority of the equity interests of Seneca are owned by
Phoenix Investment Partners Ltd. ("PXP"), an indirect, majority-owned subsidiary
of Phoenix Home Life Mutual Insurance Company ("PHL"). As compensation for
services
42
<PAGE>
PHOENIX-SENECA FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1999 (CONTINUED)
to the Trust, the adviser receives a fee based upon the following annual rates
as a percentage of the average daily net assets of each Fund:
<TABLE>
<CAPTION>
Adviser
Fee
--------
<S> <C>
Bond Fund.................................... 0.50%
Growth Fund.................................. 0.70%
Mid-Cap "EDGE"-SM- Fund...................... 0.80%
Real Estate Securities Fund.................. 0.85%
</TABLE>
The Adviser pays the Subadviser a fee equal to one half of the Adviser fee.
Phoenix Equity Planning Corporation ("PEPCO"), a direct subsidiary of PXP,
serves as Administrator of the Trust. PEPCO received a fee for administration
services through December 31, 1998 at an annual rate of 0.08% of average daily
net assets of each Fund up to $125 million, 0.06% of average daily net assets of
$125 million to $250 million and 0.04% of average daily net assets greater than
$250 million; a minimum fee applied. Effective January 1, 1999, PEPCO receives a
financial agent fee equal to the sum of (1) the documented cost of fund
accounting and related services provided by PFPC Inc. (subagent to PEPCO), plus
(2) the documented cost to PEPCO to provide financial reporting, tax services
and oversight of the subagent's performance. The current fee schedule of PFPC
Inc. ranges from 0.085% to 0.0125% of the average daily net asset values of the
Trust. Certain minimum fees and fee waivers may apply.
The Adviser voluntarily agreed to waive or reimburse each Fund's operating
expenses until July 1, 2000, to the extent that such expenses exceed the
following percentages of average annual net assets:
<TABLE>
<CAPTION>
Class X Class A Class B Class C
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Bond Fund.................. 0.90% 1.15% 1.90% 1.90%
Growth Fund................ 1.25% 1.85% 2.60% 2.60%
Mid-Cap "EDGE"-SM- Fund.... 2.10% 2.70% 3.45% 3.45%
Real Estate Securities
Fund....................... 2.35% 3.05% 3.80% 3.80%
</TABLE>
Prior to July 1, 1999, the Adviser voluntarily agreed to waive or reimburse
the Bond Fund's operating expenses until July 1, 2000, to the extent that such
expenses exceeded the following percentages of average annual net assets: 1.85%
for Class X, 2.45% for Class A and 3.20% for Class B and Class C.
PEPCO serves as the national distributor of the Trust's shares and has advised
the Trust that it retained net selling commissions of $16,238 for Class A shares
for the year ended September 30, 1999. Deferred sales charges retained by PEPCO
for the year ended September 30, 1999 were $6,758 for Class B shares and $689
for Class C shares. In addition, each Fund pays PEPCO a distribution fee at an
annual rate of 0.25% for Class A shares and 1.00% for Class B and C shares
applied to the average daily net assets of each Fund. The distributor has
advised the Trust that of the total amount expensed for the year ended
September 30, 1999, $121,864 was retained by the Distributor, $24,658 was paid
out to unaffiliated Participants and $1,637 was paid to W.S. Griffith, an
indirect subsidiary of PHL.
PEPCO serves as the Trust's Transfer Agent with State Street Bank and Trust
Company as sub-transfer agent. For the year ended September 30, 1999, transfer
agent fees were $330,067 of which PEPCO retained $425 which is net of fees paid
to State Street.
At September 30, 1999, PHL and affiliates held Phoenix-Seneca Fund shares
which aggregated the following:
<TABLE>
<CAPTION>
Aggregate
Net Asset
Shares Value
--------- -----------
<S> <C> <C>
Bond Fund--Class X.................. 1,496,147 $15,485,121
Bond Fund--Class A.................. 9,878 101,646
Bond Fund--Class B.................. 9,816 100,810
Bond Fund--Class C.................. 9,815 100,800
Growth Fund--Class B................ 829 15,982
Growth Fund--Class C................ 5,931 114,177
Mid-Cap "EDGE"-SM- Fund--Class B.... 6,062 105,532
Mid-Cap "EDGE"-SM- Fund--Class C.... 6,062 105,479
Real Estate Securities
Fund--Class B....................... 8,345 79,697
Real Estate Securities
Fund--Class C....................... 8,346 79,700
</TABLE>
3. PURCHASE AND SALE OF SECURITIES
Purchases and sales of securities during the year ended September 30, 1999
(excluding U.S. Government and agency securities and short-term securities)
aggregated the following:
<TABLE>
<CAPTION>
Purchases Sales
------------ ------------
<S> <C> <C>
Bond Fund........................ $ 26,311,365 $ 16,449,029
Growth Fund...................... 108,894,225 101,158,985
Mid-Cap "EDGE"-SM- Fund.......... 34,069,753 31,673,766
Real Estate Securities Fund...... 1,130,983 3,044,370
</TABLE>
Purchases and sales of long-term U.S. Government and agency securities during
the year ended September 30, 1999, aggregated $18,227,311 and $13,990,110,
respectively, for the Bond Fund.
4. CREDIT RISK
In countries with limited or developing markets, investments may present
greater risks than in more developed markets and the prices of such investments
may be volatile. The consequences of political, social or economic changes in
these markets may have disruptive effects on the market prices of these
investments and the income they generate, as well as a fund's ability to
repatriate such amounts.
43
<PAGE>
PHOENIX-SENECA FUNDS
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1999 (CONTINUED)
5. OTHER
As of September 30, 1999, the Funds had shareholders who each individually
owned more than 10% of total net assets, none of whom are affiliated with PHL or
PXP as follows. In addition, affiliate holdings are presented in the table
located within Note 2.
<TABLE>
<CAPTION>
Number of % of Total
shareholders net assets
------------ ------------
<S> <C> <C>
Growth Fund....................... 1 12.1 %
Real Estate Securities Fund....... 2 33.8 %
</TABLE>
6. CAPITAL LOSS CARRYOVERS
At September 30, 1999, the Real Estate Securities Fund had a capital loss
carryover of $24,701, expiring in 2007, which may be used to offset future
capital gains.
Under current tax law, capital losses realized after October 31 may be
deferred and treated as occurring on the first day of the following fiscal year.
For the year ended September 30, 1999 the Real Estate Securities Fund deferred
capital losses of $639,028.
7. RECLASS OF CAPITAL ACCOUNTS
In accordance with accounting pronouncements, the Funds have recorded
reclassifications in the capital accounts. These reclassifications have no
impact on the net asset value of each of the Funds and are designed generally to
present undistributed income and realized gains on a tax basis which is
considered to be more informative to the shareholder. As of September 30, 1999,
the Funds recorded the following reclassifications to increase (decrease) the
accounts listed below:
<TABLE>
<CAPTION>
Capital paid
Undistributed Accumulated in on shares
net investment net realized of beneficial
income gain (loss) interest
-------------- ------------ -------------
<S> <C> <C> <C>
Bond Fund................... $ (6,484) $ 17,363 $(10,879)
Growth Fund................. 251,366 (252,922) 1,556
Mid-Cap "EDGE"-SM- Fund..... 275,816 (277,372) 1,556
Real Estate Securities
Fund........................ (2,537) 980 1,557
</TABLE>
TAX INFORMATION NOTICE (UNAUDITED)
For the fiscal year ended September 30, 1999, the Funds distributed long-term
capital gain dividends as follows:
<TABLE>
<S> <C>
Bond Fund...................................... $ 182,516
Growth Fund.................................... 1,530,633
Mid-Cap "EDGE"-SM- Fund........................ 542,452
Real Estate Securities Fund.................... 535,508
</TABLE>
This report is not authorized for distribution to prospective investors unless
preceded or accompanied by an effective Prospectus which includes information
concerning the sales charge, the Trust's record and other pertinent information.
44
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
[LOGO]
To the Trustees and Shareholders of
Phoenix-Seneca Funds
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments (except for bond ratings), 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 Phoenix-Seneca Bond Fund, the Phoenix-Seneca Growth Fund, the Phoenix-Seneca
Mid-Cap "EDGE"-SM- Fund and the Phoenix-Seneca Real Estate Securities Fund
(constituting the Phoenix-Seneca Funds, hereafter referred to as the "Funds") at
September 30, 1999, and the results of each of their operations, the changes in
each of their net assets and the financial highlights for the periods indicated,
in conformity with generally accepted accounting principles. 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 generally
accepted auditing standards 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 September 30, 1999 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above. The financial highlights of the Funds, formerly the
Seneca Funds, for the periods ended September 30, 1997 were audited by other
independent accountants whose report dated November 5, 1997 expressed an
unqualified opinion on those statements.
/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
November 16, 1999
45
<PAGE>
RESULTS OF SHAREHOLDER MEETING (UNAUDITED)
A special meeting of Shareholders of the Phoenix-Seneca Funds was held on
May 19, 1999 to approve the following matters:
1. Fix the number of trustees at eight and elect such number as detailed
below.
2. Ratification of the selection of PricewaterhouseCoopers LLP as the
Trust's independent auditors for the fiscal year ending September 30,
1999.
On the record date for this meeting there were 94,344,980 shares outstanding and
70.86% of the shares outstanding and entitled to vote were present by proxy.
NUMBER OF VOTES
<TABLE>
<CAPTION>
FOR WITHHELD
---------- --------
<S> <C> <C> <C>
1. Election of Trustees
Mary Ann Cusenza 94,209,124 135,856
Harry Dalzell-Payne 94,209,124 135,856
Norman W. Douglass 94,204,170 140,810
Paul E. Erdman 94,205,742 139,238
Melinda Ellis Evers 94,209,124 135,856
Paul B. Fay, Jr. 94,156,852 188,128
Philip R. McLoughlin 94,158,662 186,318
Gail P. Seneca 94,207,552 137,428
FOR AGAINST ABSTAIN
---------- ---------- -------
2. PricewaterhouseCoopers LLP
94,125,711 87,193 132,076
</TABLE>
46
<PAGE>
PHOENIX-SENECA FUNDS
909 Montgomery Street
San Francisco, California 94133
TRUSTEES AND OFFICERS
Mary Ann Cusenza, Trustee
Harry Dalzell-Payne, Trustee
Norman W. Douglass, Trustee
Paul E. Erdman, Trustee
Melinda Ellis Evers, Trustee
Paul B. Fay, Jr., Trustee
Philip R. McLoughlin, Trustee
Gail P. Seneca, President and Trustee
Thomas N. Steenburg, Secretary
Sandra J. Monticelli, Treasurer
INVESTMENT ADVISER
Phoenix Investment Counsel, Inc.
56 Prospect Street
Hartford, Connecticut 06115-0480
SUBADVISER
Seneca Capital Management LLC
909 Montgomery Street
San Francisco, California 94133
PRINCIPAL UNDERWRITER
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
CUSTODIAN
State Street Bank and Trust Company
P. O. Box 351
Boston, Massachusetts 02101
TRANSFER AGENT
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
160 Federal Street
Boston, Massachusetts 02110
HOW TO CONTACT US
<TABLE>
<S> <C>
The Fund Connection 1-800-243-1574
Customer Service 1-800-243-1574 (option
0)
Investment Strategy Hotline 1-800-243-4361 (option
2)
Marketing Department 1-800-243-4361 (option
3)
Text Telephone 1-800-243-1926
</TABLE>
World Wide Web address:
WWW.PHOENIXINVESTMENTS.COM
<PAGE>
Phoenix Equity Planning Corporation PRSRT STD
PO Box 2200 U.S. Postage
Enfield CT 06083-2200 PAID
Springfield, MA
[LOGO] PHOENIX Permit No. 444
INVESTMENT PARTNERS
PXP 1140 (11/99)
