<PAGE>
Phoenix Investment Partners
Annual Report
April 30, 2000
*SENECA*
Phoenix-Seneca
Growth Fund
[LOGO]
<PAGE>
MESSAGE FROM THE PRESIDENT
DEAR SHAREHOLDER:
We are pleased to provide this financial summary for the Phoenix-Seneca Growth
Fund for the seven months ended April 30, 2000.
If you have any questions, please call your financial advisor or a customer
service representative at 1-800-243-1574 between 8:00 a.m. and 6:00 p.m. Eastern
Time, Monday through Friday.
Sincerely,
/s/ Philip R. McLoughlin
Philip R. McLoughlin
MAY 17, 2000
Mutual funds are not insured by the FDIC; are not
deposits or other obligations of a bank and are not
guaranteed by a bank; and are subject to
investment risks, including possible loss of the
principal invested.
1
<PAGE>
PHOENIX-SENECA GROWTH FUND
AVERAGE ANNUAL TOTAL RETURNS(1) PERIODS ENDING 4/30/00
<TABLE>
<CAPTION>
SEVEN MONTHS INCEPTION INCEPTION
ENDED 4/30/00 TO 4/30/00 DATE
-------------- ----------- ------------
<S> <C> <C> <C>
Class X Shares at NAV(2) 25.04% 31.72% 3/8/96
Class A Shares at NAV(2) 24.81 30.98 3/8/96
Class A Shares at POP(3) 17.63 29.13 3/8/96
Class B Shares at NAV(2) 24.10 20.12 7/1/98
Class B Shares with CDSC(4) 19.10 18.23 7/1/98
Class C Shares at NAV(2) 24.09 20.01 7/1/98
Class C Shares with CDSC(4) 23.09 20.01 7/1/98
S&P 500 Index(7) 14.17 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 5.75% 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 24.29% for Class X and Class A (since 3/8/96) and
15.34% 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 4/30
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PHOENIX-SENECA PHOENIX-SENECA
GROWTH CLASS A(6) GROWTH CLASS X(6) S&P 500 INDEX (7)
<S> <C> <C> <C>
3/96 $9,425 $10,000 $10,000
96 $11,461 $12,180 $10,352
97 $13,856 $14,858 $12,961
98 $19,161 $20,674 $18,310
99 $22,341 $24,205 $22,305
00 $28,871 $31,352 $24,612
</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 5.75% 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 4/30/00
As a percentage of equity holdings
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
Technology 33%
Financials 11%
Health-Care 11%
Consumer Staples 11%
Capital Goods 9%
Consumer Cyclicals 7%
Basic Materials 7%
Other 11%
</TABLE>
2
<PAGE>
Phoenix-Seneca Growth Fund
INVESTMENTS AT APRIL 30, 2000
<TABLE>
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
COMMON STOCKS--85.6%
ALUMINUM--2.3%
Alcoa, Inc.............................. 38,770 $ 2,515,204
BANKS (MAJOR REGIONAL)--2.8%
Mellon Financial Corp................... 94,420 3,033,242
BEVERAGES (NON-ALCOHOLIC)--2.3%
Coca-Cola Co. (The)..................... 52,010 2,447,721
BROADCASTING (TELEVISION, RADIO & CABLE)--3.6%
AMFM, Inc.(b)........................... 58,890 3,908,824
CHEMICALS--2.0%
Dow Chemical Co. (The).................. 18,560 2,097,280
COMMUNICATIONS EQUIPMENT--7.7%
General Motors Corp. Class H(b)......... 41,030 3,951,702
Metricom, Inc.(b)....................... 12,490 350,501
Motorola, Inc........................... 32,830 3,908,822
------------
8,211,025
------------
COMPUTERS (HARDWARE)--3.0%
Sun Microsystems, Inc.(b)............... 34,850 3,204,022
COMPUTERS (NETWORKING)--3.0%
Cisco Systems, Inc.(b).................. 46,960 3,255,649
ELECTRICAL EQUIPMENT--4.3%
General Electric Co..................... 29,280 4,604,280
ELECTRONICS (SEMICONDUCTORS)--3.1%
Intel Corp.............................. 26,510 3,361,799
ENTERTAINMENT--2.1%
Walt Disney Co. (The)................... 51,060 2,211,536
EQUIPMENT (SEMICONDUCTORS)--4.1%
Applied Materials, Inc.(b).............. 38,140 3,883,129
KLA-Tencor Corp.(b)..................... 7,410 554,824
------------
4,437,953
------------
FINANCIAL (DIVERSIFIED)--8.1%
Citigroup, Inc.......................... 74,400 4,422,150
Morgan Stanley Dean Witter & Co......... 55,740 4,278,045
------------
8,700,195
------------
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
HEALTH CARE (DIVERSIFIED)--2.5%
Johnson & Johnson....................... 32,620 $ 2,691,150
HEALTH CARE (DRUGS--MAJOR PHARMACEUTICALS)--5.9%
Merck & Co., Inc........................ 56,240 3,908,680
Pfizer, Inc............................. 58,610 2,468,946
------------
6,377,626
------------
HEALTH CARE (HOSPITAL MANAGEMENT)--2.1%
Columbia/HCA Healthcare Corp............ 79,940 2,273,294
HOUSEHOLD PRODUCTS (NON-DURABLE)--2.2%
Clorox Co. (The)........................ 64,640 2,375,520
MANUFACTURING (DIVERSIFIED)--4.8%
Corning, Inc............................ 26,150 5,164,625
NATURAL GAS--1.9%
El Paso Energy Corp..................... 48,250 2,050,625
OIL & GAS (DRILLING & EQUIPMENT)--5.2%
Diamond Offshore Drilling, Inc.......... 26,240 1,057,800
Halliburton Co.......................... 101,090 4,466,914
------------
5,524,714
------------
PAPER & FOREST PRODUCTS--2.3%
Champion International Corp............. 37,140 2,441,955
RETAIL (BUILDING SUPPLIES)--3.7%
Lowe's Companies, Inc................... 79,690 3,944,655
RETAIL (GENERAL MERCHANDISE)--3.2%
Wal-Mart Stores, Inc.................... 61,600 3,411,100
TELECOMMUNICATIONS (CELLULAR/WIRELESS)--3.4%
Nextel Communications, Inc. Class
A(b).................................... 32,920 3,602,682
--------------------------------------------------------------------
TOTAL COMMON STOCKS
(IDENTIFIED COST $77,236,089) 91,846,676
--------------------------------------------------------------------
FOREIGN COMMON STOCKS--11.0%
COMMUNICATIONS EQUIPMENT--7.1%
Nokia Oyj Sponsored ADR (Finland)....... 69,160 3,933,475
Nortel Networks Corp. (Canada).......... 33,110 3,749,707
------------
7,683,182
------------
</TABLE>
See Notes to Financial Statements 3
<PAGE>
Phoenix-Seneca Growth Fund
<TABLE>
<CAPTION>
SHARES VALUE
-------- ------------
<S> <C> <C> <C>
ELECTRONICS (SEMICONDUCTORS)--3.9%
STMicroelectronics N.V. (Netherlands)... 21,870 $ 4,148,466
--------------------------------------------------------------------
TOTAL FOREIGN COMMON STOCKS
(IDENTIFIED COST $5,519,377) 11,831,648
--------------------------------------------------------------------
TOTAL LONG-TERM INVESTMENTS--96.6%
(IDENTIFIED COST $82,755,466) 103,678,324
--------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PAR
VALUE
(000)
---------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--11.9%
REPURCHASE AGREEMENT--11.9%
State Street Bank & Trust Co.
repurchase agreement, 4.25%,
dated 4/28/00 due 5/1/00,
repurchase price $12,730,507
collateralized by U.S.
Treasury Bond 9.875%,
11/15/15, market value
$12,987,319................... $12,726 12,726,000
-------------------------------------------------------------
TOTAL SHORT-TERM OBLIGATIONS
(IDENTIFIED COST $12,726,000) 12,726,000
-------------------------------------------------------------
</TABLE>
<TABLE>
<S> <C>
TOTAL INVESTMENTS--108.5%
(IDENTIFIED COST $95,481,466) 116,404,324(a)
Cash and receivables, less liabilities--(8.5%) (9,133,518)
------------
NET ASSETS--100.0% $107,270,806
============
</TABLE>
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $24,508,036 and gross
depreciation of $3,756,973 for federal income tax purposes. At April 30,
2000, the aggregate cost of securities for federal income tax purposes was
$95,653,261.
(b) Non-income producing.
4 See Notes to Financial Statements
<PAGE>
Phoenix-Seneca Growth Fund
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 2000
<TABLE>
<S> <C>
ASSETS
Investment securities at value, exclusive of repurchase
agreements
(Identified cost $82,755,466) $ 103,678,324
Repurchase agreements at value
(Identified cost $12,726,000) 12,726,000
Cash 559
Receivables
Investment securities sold 1,059,468
Fund shares sold 643,911
Dividends and interest 64,755
Deferred organization expenses 7,307
Prepaid expenses 935
--------------
Total assets 118,181,259
--------------
LIABILITIES
Payables
Investment securities purchased 10,683,387
Fund shares repurchased 22,792
Investment advisory fee 61,255
Distribution fee 25,615
Transfer agent fee 20,135
Financial agent fee 8,147
Trustees' fee 5,879
Accrued expenses 83,243
--------------
Total liabilities 10,910,453
--------------
NET ASSETS $ 107,270,806
==============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest $ 81,518,890
Accumulated net realized gain 4,829,058
Net unrealized appreciation 20,922,858
--------------
NET ASSETS $ 107,270,806
==============
CLASS X
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization (Net Assets $40,173,789) 1,800,489
Net asset value and offering price per share $22.31
CLASS A
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization (Net Assets $46,726,923) 2,140,158
Net asset value per share $21.83
Offering price per share $21.83/(1-5.75%) $23.16
CLASS B
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization (Net Assets $10,431,209) 488,882
Net asset value and offering price per share $21.34
CLASS C
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization (Net Assets $9,938,885) 466,746
Net asset value and offering price per share $21.29
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Seven Months
Ended Year Ended
4/30/00 9/30/99
------------ -----------
<S> <C> <C>
INVESTMENT INCOME
Dividends $ 445,820 $ 465,256
Interest 108,246 141,205
Foreign taxes withheld (2,670) --
----------- -----------
Total investment income 551,396 606,461
----------- -----------
EXPENSES
Investment advisory fee 378,813 443,317
Distribution fee, Class A 56,812 66,526
Distribution fee, Class B 44,439 24,197
Distribution fee, Class C 37,004 9,293
Financial agent fee 68,388 85,097
Transfer agent 52,724 88,614
Registration 26,735 53,567
Printing 26,064 40,695
Professional 13,890 23,412
Trustees 10,023 25,716
Custodian 7,066 12,443
Amortization of deferred organization expenses 6,220 10,658
Miscellaneous 15,311 23,541
----------- -----------
Total expenses 743,489 907,076
Less expenses borne by investment advisor -- (49,249)
----------- -----------
Net expenses 743,489 857,827
----------- -----------
NET INVESTMENT LOSS (192,093) (251,366)
----------- -----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain on securities 7,460,846 7,420,446
Net change in unrealized appreciation (depreciation) on
investments 10,116,643 8,897,166
----------- -----------
NET GAIN ON INVESTMENTS 17,577,489 16,317,612
----------- -----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $17,385,396 $16,066,246
=========== ===========
</TABLE>
See Notes to Financial Statements 5
<PAGE>
Phoenix-Seneca Growth Fund
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Seven Months
Ended Year Ended Year Ended
4/30/00 9/30/99 9/30/98
------------ ----------- -----------
<S> <C> <C> <C>
FROM OPERATIONS
Net investment income (loss) $ (192,093) $ (251,366) $ (23,589)
Net realized gain (loss) 7,460,846 7,420,446 5,786,850
Net change in unrealized appreciation
(depreciation) 10,116,643 8,897,166 (3,716,413)
------------ ----------- -----------
INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 17,385,396 16,066,246 2,046,848
------------ ----------- -----------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income, Class X -- -- (28,234)
Net realized gains, Class X (4,159,508) (2,678,808) (2,638,126)
Net realized gains, Class A (3,991,659) (2,257,410) (456,891)
Net realized gains, Class B (733,817) (125,950) --
Net realized gains, Class C (651,429) (32,675) --
------------ ----------- -----------
DECREASE IN NET ASSETS FROM
DISTRIBUTIONS TO SHAREHOLDERS (9,536,413) (5,094,843) (3,123,251)
------------ ----------- -----------
FROM SHARE TRANSACTIONS
CLASS X
Proceeds from sales of shares (82,728,
191,178 and 285,390 shares,
respectively) 1,885,353 3,657,324 4,884,932
Net asset value of shares issued from
reinvestment of distributions
(189,191, 152,656 and 175,598
shares, respectively) 4,124,386 2,665,381 2,655,713
Cost of shares repurchased (262,967,
417,927 and 669,955 shares,
respectively) (5,710,606) (7,626,080) (11,501,669)
------------ ----------- -----------
Total 299,133 (1,303,375) (3,961,024)
------------ ----------- -----------
CLASS A
Proceeds from sales of shares
(835,146, 713,052 and 903,203
shares, respectively) 18,496,399 12,978,542 16,095,224
Net asset value of shares issued from
reinvestment of distributions
(183,997, 130,999 and 30,397 shares,
respectively) 3,928,347 2,250,565 454,436
Cost of shares repurchased (463,295,
329,410 and 233,349 shares,
respectively) (9,878,135) (5,879,689) (3,581,463)
------------ ----------- -----------
Total 12,546,611 9,349,418 12,968,197
------------ ----------- -----------
CLASS B
Proceeds from sales of shares
(268,528, 209,861 and 32,039 shares,
respectively) 5,843,443 3,860,313 544,661
Net asset value of shares issued from
reinvestment of distributions
(29,013, 5,386 and 0 shares,
respectively) 607,535 92,053 --
Cost of shares repurchased (36,556,
19,389 and 0 shares, respectively) (786,499) (368,688) --
------------ ----------- -----------
Total 5,664,479 3,583,678 544,661
------------ ----------- -----------
CLASS C
Proceeds from sales of shares
(365,168, 88,996 and 7,802 shares,
respectively) 7,875,964 1,633,483 139,674
Net asset value of shares issued from
reinvestment of distributions
(27,094, 1,890 and 0 shares,
respectively) 566,265 32,392 --
Cost of shares repurchased (20,738,
3,466 and 0 shares, respectively) (453,959) (65,089) --
------------ ----------- -----------
Total 7,988,270 1,600,786 139,674
------------ ----------- -----------
INCREASE (DECREASE) IN NET ASSETS FROM
SHARE TRANSACTIONS 26,498,493 13,230,507 9,691,508
------------ ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS 34,347,476 24,201,910 8,615,105
NET ASSETS
Beginning of period 72,923,330 48,721,420 40,106,315
------------ ----------- -----------
END OF PERIOD [INCLUDING UNDISTRIBUTED
NET INVESTMENT INCOME (LOSS) OF
$0, $0 AND $0, RESPECTIVELY] $107,270,806 $72,923,330 $48,721,420
============ =========== ===========
</TABLE>
6 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 X
---------------------------------------------------------------------
FROM
SEVEN MONTHS YEAR ENDED SEPTEMBER 30, INCEPTION
ENDED ------------------------------------ 3/8/96 TO
4/30/00 1999 1998 1997 9/30/96
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 19.92 $ 16.46 $ 16.43 $ 13.74 $ 10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.01)(1) (0.04)(1) 0.00(1) 0.03 0.03
Net realized and unrealized gain (loss) 4.94 5.11 1.28 3.50 3.71
------- -------- -------- -------- -------
TOTAL FROM INVESTMENT OPERATIONS 4.93 5.07 1.28 3.53 3.74
------- -------- -------- -------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- (0.02) (0.07) --
Dividends from net realized gains (2.54) (1.61) (1.23) (0.77) --
------- -------- -------- -------- -------
TOTAL DISTRIBUTIONS (2.54) (1.61) (1.25) (0.84) --
------- -------- -------- -------- -------
Change in net asset value 2.39 3.46 0.03 2.69 3.74
------- -------- -------- -------- -------
NET ASSET VALUE, END OF PERIOD $ 22.31 $ 19.92 $ 16.46 $ 16.43 $ 13.74
======= ======== ======== ======== =======
Total return 25.04%(4) 32.19% 8.48% 27.27% 37.40%(4)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $40,174 $35,695 $30,713 $34,093 $12,920
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.06%(3) 1.16% 1.14% 1.52%(5) 0.81%(3)(5)
Net investment income (loss) (0.05)%(3) (0.20)% 0.02% 0.31% 0.76%(3)
Portfolio turnover 68%(4) 169% 166% 145.69% 87.66%(4)
</TABLE>
<TABLE>
<CAPTION>
CLASS A
---------------------------------------------------------------------
FROM
SEVEN MONTHS YEAR ENDED SEPTEMBER 30, INCEPTION
ENDED ------------------------------------ 3/8/96 TO
4/30/00 1999 1998 1997 9/30/96
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 19.57 $ 16.23 $ 16.28 $ 13.63 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) (0.04)(1) (0.09)(1) (0.06)(1) (0.08) --
Net realized and unrealized gain 4.84 5.04 1.24 3.50 3.63
------- -------- -------- -------- ------
TOTAL FROM INVESTMENT OPERATIONS 4.80 4.95 1.18 3.42 3.63
------- -------- -------- -------- ------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- -- -- --
Dividends from net realized gains (2.54) (1.61) (1.23) (0.77) --
------- -------- -------- -------- ------
TOTAL DISTRIBUTIONS (2.54) (1.61) (1.23) (0.77) --
------- -------- -------- -------- ------
Change in net asset value 2.26 3.34 (0.05) 2.65 3.63
------- -------- -------- -------- ------
NET ASSET VALUE, END OF PERIOD $ 21.83 $ 19.57 $ 16.23 $ 16.28 $13.63
======= ======== ======== ======== ======
Total return(2) 24.81%(4) 31.89% 7.93% 26.51% 36.30%(4)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $46,727 $31,001 $17,364 $6,013 $466
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.31%(3) 1.44% 1.55% 2.48%(6) 1.46%(3)(6)
Net investment income (loss) (0.29)%(3) (0.49)% (0.36)% (0.62)% 0.16%(3)
Portfolio turnover 68%(4) 169% 166% 145.69% 87.66%(4)
</TABLE>
(1) Computed using average shares outstanding.
(2) Maximum sales charge is not reflected in total return calculation.
(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 1.52% and
3.49% for the periods ended September 30, 1997 and 1996, respectively.
(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 periods ended September 30, 1997 and 1996, respectively.
See Notes to Financial Statements 7
<PAGE>
Phoenix-Seneca Growth Fund
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
<TABLE>
<CAPTION>
CLASS B
-----------------------------------------------
FROM
SEVEN MONTHS YEAR INCEPTION
ENDED ENDED 7/1/98 TO
4/30/00 9/30/99 9/30/98
<S> <C> <C> <C>
Net asset value, beginning of period $ 19.28 $16.19 $18.71
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)(1) (0.17) (0.31) (0.04)
Net realized and unrealized gain (loss) 4.77 5.01 (2.48)
------- ------ ------
TOTAL FROM INVESTMENT OPERATIONS 4.60 4.70 (2.52)
------- ------ ------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- --
Dividends from net realized gains (2.54) (1.61) --
------- ------ ------
TOTAL DISTRIBUTIONS (2.54) (1.61) --
------- ------ ------
Change in net asset value 2.06 3.09 (2.52)
------- ------ ------
NET ASSET VALUE, END OF PERIOD $ 21.34 $19.28 $16.19
======= ====== ======
Total return(2) 24.10%(4) 30.31% (13.47)%(4)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $10,431 $4,395 $519
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.42%(3) 2.60%(5) 2.60%(3)(5)
Net investment income (loss) (1.39)%(3) (1.66)% (1.12)%(3)
Portfolio turnover 68%(4) 169% 166%(4)
</TABLE>
<TABLE>
<CAPTION>
CLASS C
-----------------------------------------------
FROM
SEVEN MONTHS YEAR INCEPTION
ENDED ENDED 7/1/98 TO
4/30/00 9/30/99 9/30/98
<S> <C> <C> <C>
Net asset value, beginning of period $19.25 $16.18 $18.71
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)(1) (0.19) (0.32) (0.06)
Net realized and unrealized gain (loss) 4.77 5.00 (2.47)
------ ------ ------
TOTAL FROM INVESTMENT OPERATIONS 4.58 4.68 (2.53)
------ ------ ------
LESS DISTRIBUTIONS:
Dividends from net investment income -- -- --
Dividends from net realized gains (2.54) (1.61) --
------ ------ ------
TOTAL DISTRIBUTIONS (2.54) (1.61) --
------ ------ ------
Change in net asset value 2.04 3.07 (2.53)
------ ------ ------
NET ASSET VALUE, END OF PERIOD $21.29 $19.25 $16.18
====== ====== ======
Total return(2) 24.09%(4) 30.20% (13.52)%(4)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $9,939 $1,833 $126
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.51%(3) 2.60%(6) 2.60%(3)(6)
Net investment income (loss) (1.48)%(3) (1.66)% (1.39)%(3)
Portfolio turnover 68%(4) 169% 166%(4)
</TABLE>
(1) Computed using average shares outstanding.
(2) Maximum sales charge is not reflected in total return calculation.
(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 3.46% and
12.48% for the periods ended September 30, 1999 and 1998, respectively.
(6) 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 1998, respectively.
8 See Notes to Financial Statements
<PAGE>
PHOENIX-SENECA GROWTH FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000
1. SIGNIFICANT ACCOUNTING POLICIES
The Phoenix-Seneca Growth Fund (the "Fund") is a series of the Phoenix-Seneca
Funds (the "Trust") which 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. The Fund seeks to achieve
long-term capital appreciation. The 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. Effective April 3, 2000,
Class A shares are sold with a front-end sales charge of up to 5.75%. Prior to
that date, the maximum sales charge was 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 Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States 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. 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. Realized gains and losses are determined on the identified cost basis.
C. INCOME TAXES:
It is the policy of the 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, the 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 the 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 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 Fund 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:
The 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
9
<PAGE>
PHOENIX-SENECA GROWTH FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (CONTINUED)
directly between currency traders and their customers. The contract is
marked-to-market daily and the change in market value is recorded by the 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:
The 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. The 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.
The Fund may purchase options which are included in the Fund's 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 Fund 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 the 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. The 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 Fund 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
to the Fund, the adviser is entitled to a fee at an annual rate of 0.70% of the
average daily net assets of the Fund. 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 Fund. 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 Fund. Certain minimum fees and fee
waivers may apply.
The Adviser voluntarily agreed to waive or reimburse the Fund's operating
expenses until January 31, 2001, to the extent that such expenses exceed the
following percentages of average annual net assets: 1.25% for Class X, 1.85% for
Class A and 2.60% for Classes B and C.
PEPCO serves as the national distributor of the Fund's shares and has advised
the Fund that it retained net selling commissions of $18,628 for Class A shares
for the seven months ended April 30, 2000. Deferred sales charges retained by
PEPCO for the seven months ended April 30, 2000 were $12,175 for Class B shares
and $262 for Class C shares. In addition, the 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 the Fund. The distributor has advised
the Fund that of the total amount expensed for the seven months ended April 30,
2000,
10
<PAGE>
PHOENIX-SENECA GROWTH FUND
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 2000 (CONTINUED)
$100,932 was retained by the Distributor, $36,051 was paid out to unaffiliated
Participants and $1,272 was paid to W.S. Griffith, an indirect subsidiary of
PHL.
PEPCO serves as the Funds Transfer Agent with State Street Bank and Trust
Company as sub-transfer agent. For the seven months ended April 30, 2000,
transfer agent fees were $52,724 of which PEPCO retained $1,153 which is net of
fees paid to State Street.
At April 30, 2000, PHL and affiliates held 929 Class B shares and 6,652 Class
C shares of the Fund with a combined value of $161,445.
3. PURCHASE AND SALE OF SECURITIES
During the seven months ended April 30, 2000, purchases and sales of
investments, excluding short-term securities and U.S. Government and agency
securities, amounted to $76,742,174 and $60,256,023, respectively. There were no
purchases and sales of long-term U.S. Government and agency securities during
the period.
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 the Fund's ability to
repatriate such amounts.
5. OTHER
As of April 30, 2000, the Fund had 1 shareholder who individually owned 10.2%
of total net assets, who is not affiliated with PHL or PXP. In addition,
affiliate holdings are presented within Note 2.
6. RECLASS OF CAPITAL ACCOUNTS
In accordance with accounting pronouncements, the Fund has recorded
reclassifications in the capital accounts. These reclassifications have no
impact on the net asset value of the Fund 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 April 30, 2000, the Fund increased
undistributed net investment income by $192,093, decreased accumulated net
realized gain by $192,427, and increased capital paid in on shares of beneficial
interest by $334.
7. SUBSEQUENT EVENT
On May 12, 2000, the Phoenix-Seneca Equity Opportunities Fund (the "Acquiring
Fund") acquired the assets and liabilities of the Phoenix-Seneca Growth Fund
(the "Acquired Fund") pursuant to a plan of reorganization approved by its
shareholders on April 28, 2000. The acquisition was accomplished by a tax-free
exchange of shares of the Acquiring Fund in an amount equal to the outstanding
shares of the Acquired Fund. Effective May 12, 2000, the Acquiring Fund was
renamed the Phoenix-Seneca Growth Fund. For financial reporting purposes the
historical results of the Acquired Fund will survive.
TAX INFORMATION NOTICE (UNAUDITED)
For the seven months ended April 30, 2000, the Fund distributed long-term
capital gain dividends of $2,908,271.
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 Fund's record and other pertinent information.
11
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
[LOGO]
To the Trustees and Shareholders of
Phoenix-Seneca Growth Fund
In our opinion, the accompanying statement of assets and liabilities,
including the schedule of investments, and the related statements of operations
and of changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Phoenix-Seneca Growth Fund (the
"Fund") at April 30, 2000, the results of its operations and the changes in its
net assets for the periods presented and the financial highlights for the period
ended April 30, 2000 and each of the two years in the period ended
September 30, 1999, in conformity with accounting principles generally accepted
in the United States. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of the
Fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with auditing standards generally accepted in
the United States, 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 April 30, 2000, by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above. The financial statements of the Fund, formerly a
portfolio in 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
June 1, 2000
12
<PAGE>
RESULTS OF SHAREHOLDER MEETING (UNAUDITED)
A special meeting of Shareholders of the Phoenix-Seneca Growth Fund of the
Phoenix-Seneca Funds was held on April 28, 2000 to approve the following matter:
1. Approval of an agreement and plan of reorganization under which the
Phoenix-Seneca Growth Fund will be combined with the Phoenix-Seneca Equity
Opportunities Fund, a series of the Phoenix Strategic Equity Series Fund.
On the record date for this meeting there were 100,298,123 shares outstanding
and 57.54% of the shares outstanding and entitled to vote were present by proxy.
NUMBER OF VOTES
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
---------- --------- ---------
<S> <C> <C> <C>
1. Approval of amendment and plan of
reorganization 56,226,586 547,616 938,472
</TABLE>
13
<PAGE>
PHOENIX-SENECA FUNDS
909 Montgomery Street
San Francisco, California 94133
TRUSTEES AND OFFICERS
Robert Chesek, Trustee
E. Virgil Conway, Trustee
William W. Crawford, Trustee
Harry Dalzell-Payne, Trustee
William N. Georgeson, Trustee
Francis E. Jeffries, Trustee
Leroy Keith, Jr., Trustee
Eileen A. Moran, Trustee
Everett L. Morris, Trustee
James M. Oates, Trustee
Richard A. Pavia, Trustee
Herbert Roth, Jr., Trustee
Richard E. Segerson, Trustee
Lowell P. Weicker, Jr., Trustee
Philip R. McLoughlin, Chairman and Trustee
Gail P. Seneca, President
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
The Fund Connection 1-800-243-1574
Customer Service 1-800-243-1574
Investment Strategy Hotline 1-800-243-4361 (option 2)
Marketing Department 1-800-243-4361 (option 3)
Text Telephone 1-800-243-1926
WWW.PHOENIXINVESTMENTS.COM
<PAGE>
PHOENIX EQUITY PLANNING CORPORATION
PO Box 2200
Enfield CT 06083-2200
PRSRT STD
U.S. Postage
PAID
Andrew
Associates
[LOGO]
For more information about
Phoenix mutual funds, please call
your financial representative or
contact us at 1-800-243-4361 or
WWW.PHOENIXINVESTMENTS.COM
PXP 1385 (6/00)
