<PAGE> 1
OPPENHEIMER INTERNATIONAL GROWTH FUND
Annual Report November 30, 1996
[PHOTO]
[OPPENHEIMERFUNDS LOGO]
<PAGE> 2
THIS FUND IS FOR PEOPLE WHO WANT TO TAKE ADVANTAGE OF OUTSTANDING GROWTH
OPPORTUNITIES THE WORLD OVER.
HOW YOUR FUND IS MANAGED
By employing a disciplined "theme" approach to investing, Oppenheimer
International Growth Fund seeks to capitalize on long-term global trends. One
of the Fund's goals is to lessen risk by investing in a wide range of stocks
across a broad spectrum of industries and countries. Because of its
international focus, searching foreign markets for outstanding performance, the
Fund offers impressive growth potential.
PERFORMANCE
Cumulative total returns since inception on 3/25/96 for the period ended
12/31/96 were 19.10% for Class A shares, 18.10% for Class B shares and 18.20%
for Class C shares, without deducting sales charges.(1)
Your Fund's cumulative total returns since inception on 3/25/96 for the
period ended 12/31/96 were 12.25% for Class A shares, 13.10% for Class B shares
and 17.20% for Class C shares.(2)
OUTLOOK
"Our outlook is very positive. Because we had the benefit of seeing first-hand
the effects of corporate restructuring within the U.S., we plan to use that
knowledge as a proactive edge in searching for European companies that have the
potential of performing well under similar circumstances."
George Evans, Portfolio Manager
November 30, 1996
Total returns include change in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the period shown.
IN REVIEWING PERFORMANCE AND RANKINGS, PLEASE REMEMBER THAT PAST PERFORMANCE
DOES NOT GUARANTEE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THE ORIGINAL COST.
1. Includes change in net asset value per share without deducting any sales
charges. Such performance is not annualized and would have been lower if sales
charges were taken into account.
2. Total returns include the deduction of (i) the maximum sales charge of 5.75%
for Class A shares, (ii) the 5% contingent deferred sales charge for Class B
shares, or (iii) the 1% contingent deferred sales charge for Class C shares. An
explanation of the different returns is in the Fund's prospectus. Class B and C
shares are subject to an annual .75% asset-based sales charge.
2 Oppenheimer International Growth Fund
<PAGE> 3
[PHOTO]
BRIDGET A. MACASKILL
President
Oppenheimer
International
Growth Fund
DEAR SHAREHOLDER,
This has been an exciting year for the international equity markets. We've seen
many of the world's economies strengthen as the pace of economic growth
accelerated across the industrialized world. Several countries that only a few
short years ago were struggling with major crises--currency devaluations, large
government deficits, high inflation and unemployment rates--have since taken
important steps toward rebuilding their economies. For these reasons, we
believe now is the time to focus on the opportunities to be found abroad.
Analysts estimate earnings in North America for 1996 will be up about 8%
by the end of the year. Across the rest of the globe, however, they predict
corporate earnings will surpass the U.S., with the potential for additional
gains in 1997. In Europe, in particular, we're seeing a trend in corporate
restructuring, including downsizing, outsourcing and spinoffs.
As for economic growth in developing countries, Brazil has emerged as a
dominant player in 1996, and we believe it has great potential for the coming
years. In general, the spending power of the population in developing countries
keeps growing. For the first time, a substantial number of individuals are
buying consumer products, including motorcycles, TVs and cars.
Additionally, there has been a turnaround in Japan. After a five-year
recession, the Japanese economy recently began to recover, producing numerous
investment opportunities. Furthermore, around the world, there has been a
significant move toward capitalism. Right now, the wealth of the world is built
on the combined spending power of 700 million people who control most of the
world's assets. However, as the 4.5 billion people who live in developing
countries become more capitalistic, we will undoubtedly see a chain reaction
which may revitalize a number of industries that cater to these new consumers.
Despite this pickup in global economic growth, inflation has remained
low. Moreover, many European governments are now concentrating on balancing
their budgets in anticipation of a European monetary union. So, it is
reasonable to expect global interest rates to remain low into 1997. All these
changes bode well for international stock markets and economies.
Investing abroad involves greater risk, including political and economic
uncertainties, currency rate fluctuations and liquidity restrictions, but over
time we expect that the long-term returns will more than compensate for
temporary risks. That said, we're confident that by diversifying your
investments throughout the world, you should be well-positioned to participate
in any economic environment.
Your portfolio managers discuss the outlook for your Fund in light of
these broad issues on the following pages. Thank you for your confidence in
OppenheimerFunds. We look forward to helping you reach your investment goals in
the future.
/s/ BRIDGET A. MACASKILL
Bridget A. Macaskill
November 21, 1996
3 Oppenheimer International Growth Fund
<PAGE> 4
Q + A
[PHOTO]
GEORGE EVANS
Portfolio Manager
AN INTERVIEW WITH YOUR FUND'S MANAGERS.
HOW HAS THE FUND PERFORMED?
Oppenheimer International Growth Fund has performed well since its inception on
March 25, 1996. The Fund is invested in a diverse portfolio of stocks from
many countries. This diversification can help to reduce the short-term
volatility of investments in foreign stocks and provide potential for
long-term growth.
WHAT INVESTMENTS MADE POSITIVE CONTRIBUTIONS TO PERFORMANCE?
In structuring this portfolio, we identified eight "themes" that we believe
will be instrumental to future global economic growth. Using those themes as
a framework, we search for companies that are showing faster-than-average
growth, rather than making selections based on country or region. One example
of a trend that fits our theme approach is the shift we are seeing toward
private pensions as Europe weans its citizens off state-funded retirement
plans. A successful investment we made as a result of this trend was a German
insurance brokerage firm that concentrates on individual retirement savings
plans in Europe.
Also, because world travel has become more common, two of our
investments in the airline industry have been very strong. One was an airline
security firm functioning primarily in Europe, whose principal business is
prescreening passengers along with their baggage, a trend expected to quickly
move into the U.S. Another successful investment in this industry involves a
firm that is a world leader in CADCAM technology, that is used in industrial
design, allowing industrial products to be designed more efficiently.(1)
DID ANY INVESTMENTS NOT PERFORM AS YOU EXPECTED?
While the Fund performed exceptionally well, we did have a few disappointments.
Japan as a whole has been disappointing because of the uncertainty regarding
the strength of that country's recovery. Also, an industrial park developer
based in the Philippines underperformed during the period; however, we believe
this company is undervalued and should see substantial appreciation over the
coming year.
WHAT AREAS ARE YOU CURRENTLY TARGETING?
We continue to target growing companies that fall into the guidelines of our
investment themes. We're looking for businesses with promising technologies and
solid market positioning that produce superior products at good prices. Going
forward, four areas we believe hold good potential are healthcare, particularly
pharmaceuticals; oil service companies; firms that develop efficiency enhancing
technologies; and banks in emerging markets.
WHAT IS YOUR OUTLOOK FOR THE FUND?
Our outlook is very positive. In Europe, companies are placing more of an
emphasis on shareholder value by increasing efficiency and profitability. As a
result, we are starting to see the initial stages of corporate restructuring
and refocusing, a trend that has played out in the U.S. during the last decade.
Because we had the benefit of seeing first-hand the effects of corporate
restructuring within the U.S., we plan to use that knowledge as a proactive
edge in searching for European companies that have the potential of performing
well under similar circumstances.
1. The Fund's portfolio is subject to change.
4 Oppenheimer International Growth Fund
<PAGE> 5
STATEMENT OF INVESTMENTS November 30, 1996
<TABLE>
<S> <C> <C>
MARKET VALUE
SHARES SEE NOTE 1
=====================================================================================================================
COMMON STOCKS--97.3%
- ---------------------------------------------------------------------------------------------------------------------
BASIC MATERIALS--1.2% Cia de Minas Buenaventura SA, Sponsored ADR(1) 20,000 $327,500
- ---------------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS--13.7%
- ---------------------------------------------------------------------------------------------------------------------
AUTOS & HOUSING--4.8% Autobacs Seven Co. Ltd. 4,000 297,012
-------------------------------------------------------------------------------------------
Brazil Realty SA, GDR(1)(2) 3,000 54,390
-------------------------------------------------------------------------------------------
China Resources Beijing Land(1) 678,000 420,900
-------------------------------------------------------------------------------------------
Porsche AG, Preference(1) 700 548,759
----------
1,321,061
- ---------------------------------------------------------------------------------------------------------------------
LEISURE & ENTERTAINMENT--1.6%
Lusomundo SGPS SA(1) 40,000 435,595
- ---------------------------------------------------------------------------------------------------------------------
MEDIA--0.8% Grupo Radio Centro SA de CV, Sponsored ADR(1) 20,000 147,500
-------------------------------------------------------------------------------------------
News Corp. Ltd. 14,049 74,829
----------
222,329
- ---------------------------------------------------------------------------------------------------------------------
RETAIL: GENERAL--3.8% Bulgari SpA 20,000 370,317
-------------------------------------------------------------------------------------------
InWear Group AS(1) 15,000 680,033
----------
1,050,350
- ---------------------------------------------------------------------------------------------------------------------
RETAIL: SPECIALTY--2.7% adidas AG 2,200 191,789
-------------------------------------------------------------------------------------------
Wella AG 1,000 551,686
----------
743,475
- ---------------------------------------------------------------------------------------------------------------------
CONSUMER NON-CYCLICALS--14.8%
- ---------------------------------------------------------------------------------------------------------------------
BEVERAGES--1.4% Hellenic Bottling Co., SA 6,000 173,137
-------------------------------------------------------------------------------------------
Serm Suk Co. Ltd. 2,000 35,238
-------------------------------------------------------------------------------------------
Serm Suk Public Co. Ltd. 6,000 183,238
----------
391,613
- ---------------------------------------------------------------------------------------------------------------------
HEALTHCARE/DRUGS--11.6% Altana AG 500 417,017
-------------------------------------------------------------------------------------------
Appligene Oncor SA(1) 15,000 287,211
-------------------------------------------------------------------------------------------
Ares-Serono Group, C1. B 600 561,150
-------------------------------------------------------------------------------------------
Bicompatibles International plc(1) 19,833 247,275
-------------------------------------------------------------------------------------------
Ciba-Geigy AG 200 247,711
-------------------------------------------------------------------------------------------
Glaxo Wellcome plc 25,000 410,939
-------------------------------------------------------------------------------------------
Oxford Molecular Group plc(1) 100,000 596,507
-------------------------------------------------------------------------------------------
Sanofi SA 3,000 268,830
-------------------------------------------------------------------------------------------
Torii Pharmaceutical Co. Ltd. 10,000 191,564
----------
3,228,204
- ---------------------------------------------------------------------------------------------------------------------
HEALTHCARE/SUPPLIES & SERVICES--1.8%
Nichii Gakkan Co. 2,000 94,903
-------------------------------------------------------------------------------------------
Oticon Holding AS 2,000 390,531
----------
485,434
</TABLE>
5 Oppenheimer International Growth Fund
<PAGE> 6
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<S> <C> <C>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------------------------------------
ENERGY--6.8%
- ---------------------------------------------------------------------------------------------------------------------
ENERGY SERVICES & PRODUCERS--2.0%
Cie Generale de Geophysique SA(1) 5,000 $359,014
-------------------------------------------------------------------------------------------
Smedvig AS, Series B(1) 10,000 199,524
---------
558,538
- ---------------------------------------------------------------------------------------------------------------------
OIL-INTEGRATED--4.8% Expro International Group plc 125,000 955,672
-------------------------------------------------------------------------------------------
Novus Petroleum Ltd. 100,000 191,388
-------------------------------------------------------------------------------------------
Saga Petroleum AS, Cl. A 12,000 194,535
---------
1,341,595
- ---------------------------------------------------------------------------------------------------------------------
FINANCIAL--19.9%
- ---------------------------------------------------------------------------------------------------------------------
BANKS--10.1% Banco Frances del Rio de la Plata SA, Sponsored ADR 19,500 589,875
-------------------------------------------------------------------------------------------
HSBC Holdings plc 40,392 841,063
-------------------------------------------------------------------------------------------
Merita Ltd., Cl. A(1) 250,000 797,240
-------------------------------------------------------------------------------------------
Standard Chartered Bank plc 50,118 568,861
---------
2,797,039
- ---------------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL--4.3%
ABN Amro Holding NV 5,043 326,634
-------------------------------------------------------------------------------------------
Hansabank Ltd.(1) 30,000 325,404
-------------------------------------------------------------------------------------------
Societe Generale 5,000 546,659
---------
1,198,697
- ---------------------------------------------------------------------------------------------------------------------
INSURANCE--5.5% Mediolanum SpA(1) 30,000 311,898
-------------------------------------------------------------------------------------------
Reinsurance Australia Corp. Ltd. 340,000 1,218,365
---------
1,530,263
- ---------------------------------------------------------------------------------------------------------------------
INDUSTRIAL--16.1%
- ---------------------------------------------------------------------------------------------------------------------
INDUSTRIAL SERVICES--7.0%
Boskalis Westminster 38,000 753,578
-------------------------------------------------------------------------------------------
ICTS International NV(1) 30,000 333,750
-------------------------------------------------------------------------------------------
MRC Allied Industries, Inc.(1) 6,000,000 855,968
---------
1,943,296
- ---------------------------------------------------------------------------------------------------------------------
MANUFACTURING--6.6% Chargeurs International SA(1) 20,000 892,269
-------------------------------------------------------------------------------------------
Hutchison Whampoa Ltd. 25,000 193,190
-------------------------------------------------------------------------------------------
Powerscreen International plc 75,000 753,616
---------
1,839,075
- ---------------------------------------------------------------------------------------------------------------------
TRANSPORTATION--2.5% Frontline AB(1) 200,000 694,222
</TABLE>
6 Oppenheimer International Growth Fund
<PAGE> 7
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
TECHNOLOGY--21.2%
- ---------------------------------------------------------------------------------------------------------------------
AEROSPACE/DEFENSE--1.6% Rolls-Royce plc 100,754 $ 433,401
- ---------------------------------------------------------------------------------------------------------------------
COMPUTER HARDWARE--0.8% Canon, Inc. 10,000 210,896
- ---------------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE--13.4% Cap Gemini SA(1) 7,500 356,285
- ---------------------------------------------------------------------------------------------------------------------
Ines Corp. 7,000 111,951
-------------------------------------------------------------------------------------------
Misys plc 55,240 924,486
-------------------------------------------------------------------------------------------
Nintendo Co. Ltd. 12,000 848,857
-------------------------------------------------------------------------------------------
SAP AG, Preference 4,000 552,987
-------------------------------------------------------------------------------------------
Sligos SA 4,000 539,191
-------------------------------------------------------------------------------------------
Versant Object Technology Corp.(1) 19,000 399,000
---------
3,732,757
- ---------------------------------------------------------------------------------------------------------------------
ELECTRONICS--4.9% Austria Mikro Systeme International AG 16,000 1,203,141
-------------------------------------------------------------------------------------------
Keyence Corp. 1,200 145,518
---------
1,348,659
- ---------------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS- Millicom International Cellular SA(1) 4,000 151,500
TECHNOLOGY--0.5%
- ---------------------------------------------------------------------------------------------------------------------
UTILITIES--3.6%
- ---------------------------------------------------------------------------------------------------------------------
Portugal Telecom SA 15,000 398,221
-------------------------------------------------------------------------------------------
Telecomunicacoes Brasileiras SA, Sponsored ADR 8,000 606,000
---------
1,004,221
----------
Total Common Stocks (Cost $24,527,652) 26,989,720
=====================================================================================================================
PREFERRED STOCKS--1.1%
- ---------------------------------------------------------------------------------------------------------------------
Marschollek, Lautenschlaeger und Partner-VO,
Non-vtg. Preferred Stock (Cost $222,411) 2,200 307,721
<Caption
UNITS
=====================================================================================================================
<S> <C> <C>
RIGHTS, WARRANTS AND CERTIFICATES--0.0%
- ---------------------------------------------------------------------------------------------------------------------
Biocompatibles International plc Wts., Exp. 2/97 (Cost $1,509) 2,833 6,427
<Caption
FACE
AMOUNT
=====================================================================================================================
<S> <C> <C>
REPURCHASE AGREEMENT--5.4%
- ---------------------------------------------------------------------------------------------------------------------
Repurchase agreement with PaineWebber, Inc., 5.66%, dated
11/29/96, to be repurchased at $1,500,708 on 12/2/96,
collateralized by U.S. Treasury Nts., 6%--7.875%,
12/31/96--10/31/01, with a value of $1,219,114, and
U.S. Treasury Bonds, 6.50%, 11/15/26, with a value
of $316,286 (Cost $1,500,000) $1,500,000 1,500,000
</TABLE>
7 Oppenheimer International Growth Fund
<PAGE> 8
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<S> <C> <C>
MARKET VALUE
SHARES SEE NOTE 1
- ---------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $26,251,572) 103.8% $28,803,868
- ---------------------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS (3.8) (1,063,908)
----- -----------
NET ASSETS 100.0% $27,739,960
===== ===========
Distribution of investments by country of issue, as a percentage of total investments at value,
is as follows:
COUNTRY MARKET VALUE PERCENT
-------------------------------------------------------------------------------------------
Great Britain $4,897,183 17.0%
-------------------------------------------------------------------------------------------
France 3,249,459 11.3
-------------------------------------------------------------------------------------------
Germany 2,569,959 8.9
-------------------------------------------------------------------------------------------
United States 2,050,500 7.1
-------------------------------------------------------------------------------------------
Japan 1,900,702 6.6
-------------------------------------------------------------------------------------------
Australia 1,484,582 5.2
-------------------------------------------------------------------------------------------
Hong Kong 1,455,153 5.1
-------------------------------------------------------------------------------------------
The Netherlands 1,413,962 4.9
-------------------------------------------------------------------------------------------
Austria 1,203,141 4.2
-------------------------------------------------------------------------------------------
Finland 1,122,644 3.9
-------------------------------------------------------------------------------------------
Denmark 1,070,563 3.7
-------------------------------------------------------------------------------------------
Philippines 855,968 3.0
-------------------------------------------------------------------------------------------
Portugal 833,817 2.9
-------------------------------------------------------------------------------------------
Switzerland 808,861 2.8
-------------------------------------------------------------------------------------------
Sweden 694,222 2.4
-------------------------------------------------------------------------------------------
Italy 682,214 2.4
-------------------------------------------------------------------------------------------
Brazil 660,390 2.3
-------------------------------------------------------------------------------------------
Argentina 589,875 2.0
-------------------------------------------------------------------------------------------
Norway 394,059 1.4
-------------------------------------------------------------------------------------------
Peru 327,500 1.1
-------------------------------------------------------------------------------------------
Thailand 218,477 0.7
-------------------------------------------------------------------------------------------
Greece 173,137 0.6
-------------------------------------------------------------------------------------------
Mexico 147,500 0.5
---------- ------------
Total $28,803,868 100.0%
=========== ============
</TABLE>
1. Non-income producing security.
2. Represents a security sold under Rule 144A, which
is exempt from registration under the Securities
Act of 1933, as amended. This security has been
determined to be liquid under guidelines established
by the Board of Trustees. This security amounts to
$54,390 or 0.20% of the Fund's net assets, at
November 30, 1996.
See accompanying Notes to Financial Statements.
8 Oppenheimer International Growth Fund
<PAGE> 9
STATEMENT OF ASSETS AND LIABILITIES November 30, 1996(1)
<TABLE>
<CAPTION>
<S> <C>
==========================================================================================================================
ASSETS Investments, at value (cost $26,251,572)--see accompanying statement $28,803,868
--------------------------------------------------------------------------------------------------------
Cash 81,705
--------------------------------------------------------------------------------------------------------
Unrealized appreciation on forward foreign currency exchange contracts--Note 5 1,084
--------------------------------------------------------------------------------------------------------
Receivables:
Shares of beneficial interest sold 702,917
Investments sold 389,028
Interest and dividends 19,388
--------------------------------------------------------------------------------------------------------
Deferred organization costs--Note 1 13,001
-----------
Total assets 30,010,991
==========================================================================================================================
LIABILITIES Unrealized depreciation on forward foreign currency exchange contracts--Note 5 15,535
--------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 2,183,499
Shares of beneficial interest redeemed 22,628
Trustees' fees 10,901
Distribution and service plan fees 6,804
Transfer and shareholder servicing agent fees 1,402
Other 30,262
-----------
Total liabilities 2,271,031
==========================================================================================================================
NET ASSETS $27,739,960
===========
==========================================================================================================================
COMPOSITION OF
NET ASSETS Paid-in capital $25,215,560
--------------------------------------------------------------------------------------------------------
Accumulated net investment loss (21,513)
--------------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments and foreign currency transactions (3,576)
--------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and
liabilities denominated in foreign currencies 2,549,489
-----------
Net assets $27,739,960
-----------
==========================================================================================================================
NET ASSET VALUE Class A Shares:
PER SHARE Net asset value and redemption price per share (based on net assets of $16,918,471
and 1,440,770 shares of beneficial interest outstanding) $11.74
Maximum offering price per share (net asset value plus sales charge of 5.75% of
offering price) $12.46
--------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on net assets
of $8,672,608 and 744,245 shares of beneficial interest outstanding) $11.65
--------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price and offering price per share (based on net assets
of $2,148,881 and 184,273 shares of beneficial interest outstanding) $11.66
</TABLE>
1. For the period from March 25, 1996 (commencement of
operations) to November 30, 1996.
See accompanying Notes to Financial Statements.
9 Oppenheimer International Growth Fund
<PAGE> 10
STATEMENT OF OPERATIONS Period Ended November 30, 1996(1)
<TABLE>
<CAPTION>
<S> <C>
========================================================================================================================
INVESTMENT INCOME Dividends (net of foreign withholding taxes of $3,226) $110,772
-------------------------------------------------------------------------------------------------
Interest 29,080
----------
Total income 139,852
========================================================================================================================
EXPENSES Management Fees--Note 4 73,489
-------------------------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 9,697
Class B 24,552
Class C 6,347
-------------------------------------------------------------------------------------------------
Shareholder reports 24,591
-------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 15,306
-------------------------------------------------------------------------------------------------
Trustees' fees and expenses--Note 1 13,085
-------------------------------------------------------------------------------------------------
Custodian fees and expenses 15,528
-------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 4,763
Class B 2,406
Class C 604
-------------------------------------------------------------------------------------------------
Legal and auditing fees 3,346
-------------------------------------------------------------------------------------------------
Insurance expenses 1,860
-------------------------------------------------------------------------------------------------
Other 8,418
----------
Total expenses 203,992
Less expenses paid indirectly (2,860)
----------
Net expenses 201,132
========================================================================================================================
NET INVESTMENT LOSS (61,280)
========================================================================================================================
REALIZED AND Net realized gain (loss) on:
UNREALIZED GAIN Investments 33,855
(LOSS) Foreign currency transactions (54,859)
----------
Net realized loss (21,004)
-------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on:
Investments 2,552,647
Translation of assets and liabilities denominated in foreign currencies (3,158)
----------
Net change 2,549,489
----------
Net realized and unrealized gain 2,528,485
========================================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $2,467,205
----------
</TABLE>
1. For the period from March 25, 1996 (commencement of
operations) to November 30, 1996.
See accompanying Notes to Financial Statements.
10 Oppenheimer International Growth Fund
<PAGE> 11
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
PERIOD ENDED
NOVEMBER 30,
1996(1)
<S> <C>
===========================================================================================================================
OPERATIONS Net investment loss $(61,280)
--------------------------------------------------------------------------------------------------
Net realized loss (21,004)
--------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 2,549,489
-----------
Net increase in net assets resulting from operations 2,467,205
===========================================================================================================================
BENEFICIAL INTEREST Net increase in net assets resulting from beneficial interest
TRANSACTIONS transactions--Note 2:
Class A 15,320,568
Class B 7,990,083
Class C 1,962,104
===========================================================================================================================
NET ASSETS Total increase 27,739,960
--------------------------------------------------------------------------------------------------
Beginning of period --
End of period (including accumulated net investment loss of $21,513) $27,739,960
===========
</TABLE>
1. For the period from March 25, 1996 (commencement
of operations) to November 30, 1996. See accompanying
Notes to Financial Statements.
11 Oppenheimer International Growth Fund
<PAGE> 12
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
------------- ------------- ------------
PERIOD ENDED PERIOD ENDED PERIOD ENDED
NOVEMBER 30, NOVEMBER 30, NOVEMBER 30,
1996(1) 1996(1) 1996(1)
=====================================================================================================================
<S> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $10.00 $10.00 $10.00
-------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss (.01) (.10) (.09)
Net realized and unrealized gain 1.75 1.75 1.75
------- ------- -------
Total income from investment operations 1.74 1.65 1.66
-------------------------------------------------------------------------------------------------------------
Net asset value, end of period $11.74 $11.65 $11.66
======= ======== =======
=============================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(2) 17.40% 16.50% 16.60%
=============================================================================================================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $16,918 $8,673 $2,149
-------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 8,992 $3,628 $ 938
-------------------------------------------------------------------------------------------------------------
Ratios to average net assets:(3)
Net investment loss (0.26)% (1.46)% (1.48)%
Expenses(4) 1.88% 2.84% 2.82%
-------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(5) 42.6% 42.6% 42.6%
Average brokerage commission rate(6) $0.0137 $0.0137 $0.0137
</TABLE>
1. For the period from March 25, 1996 (commencement of operations) to
November 30, 1996.
2. Assumes a hypothetical initial investment on the business day before
the first day of the fiscal period (or commencement of operations), with
all dividends and distributions reinvested in additional shares
on the reinvestment date, and redemption at the net asset value
calculated on the last business day of the fiscal period. Sales
charges are not reflected in the total returns. Total returns
are not annualized for periods of less than one full year.
3. Annualized.
4. The expense ratio reflects the effect of expenses paid indirectly by
the Fund.
5. The lesser of purchases or sales of portfolio securities for a
period, divided by the monthly average of the market value of
portfolio securities owned during the period. Securities with a
maturity or expiration date at the time of acquisition of one year
or less are excluded from the calculation. Purchases and sales of
investment securities (excluding short-term securities) for the period
ended November 30, 1996 were $29,906,035 and $5,192,477, respectively.
6. Total brokerage commissions paid on applicable purchases and sales
of portfolio securities for the period, divided by the total number of
related shares purchased and sold.
See accompanying Notes to Financial Statements.
12 Oppenheimer International Growth Fund
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS
================================================================================
1. SIGNIFICANT
ACCOUNTING POLICIES
Oppenheimer International Growth Fund (the Fund) is registered under the
Investment Company Act of 1940, as amended, as a diversified, open-end
management investment company. The Fund's investment objective is
capital appreciation, primarily through investments in common stocks of
foreign companies. The Fund's investment adviser is OppenheimerFunds,
Inc. (the Manager). The Fund offers Class A, Class B and Class C shares.
Class A shares are sold with a front-end sales charge. Class B and Class
C shares may be subject to a contingent deferred sales charge. All three
classes of shares have identical rights to earnings, assets and voting
privileges, except that each class has its own distribution and/or
service plan, expenses directly attributable to a particular class and
exclusive voting rights with respect to matters affecting a single
class. Class B shares will automatically convert to Class A shares six
years after the date of purchase. The following is a summary of
significant accounting policies consistently followed by the Fund.
------------------------------------------------------------------------
INVESTMENT VALUATION. Portfolio securities are valued at the close of
the New York Stock Exchange on each trading day. Listed and unlisted
securities for which such information is regularly reported are valued
at the last sale price of the day or, in the absence of sales, at values
based on the closing bid or the last sale price on the prior trading
day. Long-term and short-term ``non-money market'' debt securities are
valued by a portfolio pricing service approved by the Board of Trustees.
Such securities which cannot be valued by the approved portfolio pricing
service are valued using dealer-supplied valuations provided the Manager
is satisfied that the firm rendering the quotes is reliable and that the
quotes reflect current market value, or are valued under consistently
applied procedures established by the Board of Trustees to determine
fair value in good faith. Short-term ``money market type'' debt
securities having a remaining maturity of 60 days or less are valued at
cost (or last determined market value) adjusted for amortization to
maturity of any premium or discount. Forward foreign currency exchange
contracts are valued based on the closing prices of the forward currency
contract rates in the London foreign exchange markets on a daily basis
as provided by a reliable bank or dealer.
------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The accounting records of the Fund are
maintained in U.S. dollars. Prices of securities denominated in foreign
currencies are translated into U.S. dollars at the closing rates of
exchange. Amounts related to the purchase and sale of securities and
investment income are translated at the rates of exchange prevailing on
the respective dates of such transactions.
The effect of changes in foreign currency exchange rates on
investments is separately identified from fluctuations arising from
changes in market values of securities held and reported with all other
foreign currency gains and losses in the Fund's Statement of Operations.
------------------------------------------------------------------------
REPURCHASE AGREEMENTS. The Fund requires the custodian to take
possession, to have legally segregated in the Federal Reserve Book Entry
System or to have segregated within the custodian's vault, all
securities held as collateral for repurchase agreements. The market
value of the underlying securities is required to be at least 102% of
the resale price at the time of purchase. If the seller of the agreement
defaults and the value of the collateral declines, or if the seller
enters an insolvency proceeding, realization of the value of the
collateral by the Fund may be delayed or limited.
------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, AND GAINS AND LOSSES. Income, expenses
(other than those attributable to a specific class) and gains and losses
are allocated daily to each class of shares based upon the relative
proportion of net assets represented by such class. Operating expenses
directly attributable to a specific class are charged against the
operations of that class.
------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to continue to comply with provisions of
the Internal Revenue Code applicable to regulated investment companies
and to distribute all of its taxable income, including any net realized
gain on investments not offset by loss carryovers, to shareholders.
Therefore, no federal income or excise tax provision is required.
------------------------------------------------------------------------
TRUSTEES' FEES AND EXPENSES. The Fund has adopted a nonfunded retirement
plan for the Fund's independent trustees. Benefits are based on years of
service and fees paid to each trustee during the years of service.
During the period ended November 30, 1996, a provision of $9,458 was
made for the Fund's projected benefit obligations, resulting in an
accumulated liability of $9,458 at November 30, 1996.
------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders are recorded on the ex-dividend date.
13 Oppenheimer International Growth Fund
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS (Continued)
================================================================================
1. SIGNIFICANT
ACCOUNTING POLICIES
(CONTINUED)
ORGANIZATION COSTS. The Manager advanced $15,000 for organization and
start-up costs of the Fund. Such expenses are being amortized over a
five-year period from the date operations commenced. In the event that
all or part of the Manager's initial investment in shares of the Fund is
withdrawn during the amortization period, the redemption proceeds will be
reduced to reimburse the Fund for any unamortized expenses, in the same
ratio as the number of shares redeemed bears to the number of initial
shares outstanding at the time of such redemption.
-------------------------------------------------------------------------
CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS. Net investment income
(loss) and net realized gain (loss) may differ for financial statement
and tax purposes primarily because of the recognition of certain foreign
currency gains (losses) as ordinary income (loss) for tax purposes. The
character of the distributions made during the year from net investment
income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. Also, due to timing of
dividend distributions, the fiscal year in which amounts are distributed
may differ from the year that the income or realized gain (loss) was
recorded by the Fund.
During the period ended November 30, 1996, the Fund adjusted
the classification of distributions to shareholders to reflect the
differences between financial statement amounts and distributions
determined in accordance with income tax regulations. Accordingly, during
the period ended November 30, 1996, amounts have been reclassified to
reflect a decrease in paid-in capital of $57,195, a decrease in
accumulated net investment loss of $94,626, and an increase in
accumulated net realized loss on investments of $37,431. In addition, to
properly reflect foreign currency gain or loss in the components of
capital, $54,859 of foreign exchange loss determined according to U.S.
federal income tax rules has been reclassified from accumulated net
realized loss to accumulated net investment loss.
-------------------------------------------------------------------------
OTHER. Investment transactions are accounted for on the date the
investments are purchased or sold (trade date) and dividend income is
recorded on the ex-dividend date. Realized gains and losses on
investments and unrealized appreciation and depreciation are determined
on an identified cost basis, which is the same basis used for federal
income tax purposes.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from
those estimates.
=========================================================================
2. SHARES OF
BENEFICIAL INTEREST
The Fund has authorized an unlimited number of no par value shares of
beneficial interest. Transactions in shares of beneficial interest were
as follows:
<TABLE>
<CAPTION>
PERIOD ENDED NOVEMBER 30, 1996(1)
------------------------------
SHARES AMOUNT
-----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Class A:
Sold 1,689,570 $17,975,411
Redeemed (248,800) (2,654,843)
---------- -----------
Net increase 1,440,770 $15,320,568
========= ===========
-----------------------------------------------------------------------------------------------------------
Class B:
Sold 784,237 $8,424,204
Redeemed (39,992) (434,121)
---------- -----------
Net increase 744,245 $7,990,083
========= ===========
-----------------------------------------------------------------------------------------------------------
Class C:
Sold 206,770 $2,202,270
Redeemed (22,497) (240,166)
---------- -----------
Net increase 184,273 $1,962,104
</TABLE>
1. For the period from March 25, 1996 (commencement of operations) to
November 30, 1996.
=========================================================================
3. UNREALIZED GAINS AND
LOSSES ON INVESTMENTS
At November 30, 1996, net unrealized appreciation on investments of
$2,552,296 was composed of gross appreciation of $3,069,447, and gross
depreciation of $517,151.
14 Oppenheimer International Growth Fund
<PAGE> 15
================================================================================
4. MANAGEMENT FEES
AND OTHER TRANSACTIONS
WITH AFFILIATES
Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Fund which provides for a fee of
0.80% of the first $250 million of average annual net assets, 0.77% of
the next $250 million, 0.75% of the next $500 million, 0.69% of the next
$1 billion, and 0.67% of average annual net assets in excess of $2
billion. The Manager has agreed to reimburse the Fund if aggregate
expenses (with specified exceptions) exceed the most stringent applicable
regulatory limit on Fund expenses.
For the period ended November 30, 1996, commissions (sales
charges paid by investors) on sales of Class A shares totaled $116,839,
of which $38,416 was retained by OppenheimerFunds Distributor, Inc.
(OFDI), a subsidiary of the Manager, as general distributor, and by an
affiliated broker/dealer. Sales charges advanced to broker/dealers by
OFDI on sales of the Fund's Class B and Class C shares totaled $161,136
and $15,012, of which $4,122 was paid to an affiliated broker/dealer for
Class B shares. During the period ended November 30, 1996, OFDI received
contingent deferred sales charges of $3,230 upon redemption of Class B
shares, as reimbursement for sales commissions advanced by OFDI at
the time of sale of such shares.
OppenheimerFunds Services (OFS), a division of the Manager,
is the transfer and shareholder servicing agent for the fund, and for
other registered investment companies. ofs's total costs of providing
such services are allocated ratably to these companies.
Expenses paid indirectly represent a reduction of custodian fees
for earnings on cash balances maintained by the Fund.
The Fund has adopted a Service Plan for Class A shares to
reimburse OFDI for a portion of its costs incurred in connection with
the personal service and maintenance of accounts that hold Class A
shares. Reimbursement is made quarterly at an annual rate that may not
exceed 0.25% of the average annual net assets of Class A shares of the
Fund. OFDI uses the service fee to reimburse brokers, dealers, banks and
other financial institutions quarterly for providing personal service
and maintenance of accounts of their customers that hold Class A shares.
The Fund has adopted compensation type Distribution and
Service Plans for Class B and Class C shares to compensate OFDI for its
services and costs in distributing Class B and Class C shares and
servicing accounts. Under the Plans, the Fund pays OFDI an annual
asset-based sales charge of 0.75% per year on Class B and Class C
shares, as compensation for sales commissions paid from its own
resources at the time of sale and associated financing costs. OFDI also
receives a service fee of 0.25% per year as compensation for costs
incurred in connection with the personal service and maintenance of
accounts that hold shares of the Fund, including amounts paid to
brokers, dealers, banks and other financial institutions. Both fees are
computed on the average annual net assets of Class B and Class C shares,
determined as of the close of each regular business day. During the
period ended November 30, 1996, OFDI retained $21,237 and $4,759,
respectively, as compensation for Class B and Class C sales commissions
and service fee advances, as well as financing costs. If the Plans are
terminated by the Fund, the Board of Trustees may allow the Fund to
continue payments of the asset-based sales charge to OFDI for certain
expenses it incurred before the Plans were terminated. As of November
30, 1996, OFDI had incurred unreimbursed expenses of $123,906 for Class
B and $17,253 for Class C.
15 Oppenheimer International Growth Fund
<PAGE> 16
NOTES TO FINANCIAL STATEMENTS (Continued)
================================================================================
5. FORWARD CONTRACTS
A forward foreign currency exchange contract (forward contract) is a
commitment to purchase or sell a foreign currency at a future date, at a
negotiated rate.
The Fund uses forward contracts to seek to manage foreign
currency risks. They may also be used to tactically shift portfolio
currency risk. The Fund generally enters into forward contracts as a
hedge upon the purchase or sale of a security denominated in a foreign
currency. In addition, the Fund may enter into such contracts as a hedge
against changes in foreign currency exchange rates on portfolio
positions.
Forward contracts are valued based on the closing prices of
the forward currency contract rates in the London foreign exchange
markets on a daily basis as provided by a reliable bank or dealer. The
Fund will realize a gain or loss upon the closing or settlement of the
forward transaction.
Securities held in segregated accounts to cover net exposure on
outstanding forward contracts are noted in the Statement of Investments
where applicable. Gains and losses on outstanding contracts (unrealized
appreciation or depreciation on forward contracts) are reported in the
Statement of Assets and Liabilities. Realized gains and losses are
reported with all other foreign currency gains and losses in the Fund's
Statement of Operations.
Risks include the potential inability of the counterparty to
meet the terms of the contract and unanticipated movements in the value
of a foreign currency relative to the U.S. dollar.
At November 30, 1996, outstanding forward contracts to purchase foreign
currencies were as follows:
<TABLE>
<CAPTION>
CONTRACT
AMOUNT VALUATION AS OF UNREALIZED UNREALIZED
CONTRACTS TO PURCHASE EXPIRATION DATE (000S) NOVEMBER 30, 1996 APPRECIATION DEPRECIATION
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Austrian Schilling (ATS) 12/9/96 16,622 ATS $1,551,446 $ -- $15,128
- --------------------------------------------------------------------------------------------------------------
British Pound Sterling (GBP) 12/2/96 201 GBP 335,975 1,084 --
- --------------------------------------------------------------------------------------------------------------
French Franc (FRF) 12/3/96 507 FRF 97,276 -- 279
- --------------------------------------------------------------------------------------------------------------
Italian Lira (ITL) 12/2/96 317,844 ITL 209,937 -- 128
----------- ------ -------
$2,194,634 $1,084 $15,535
=========== ====== =======
</TABLE>
16 Oppenheimer International Growth Fund
<PAGE> 17
INDEPENDENT AUDITORS' REPORT
================================================================================
The Board of Trustees and Shareholders of Oppenheimer
International Growth Fund:
We have audited the accompanying statements of investments and
assets and liabilities of Oppenheimer International Growth Fund as of
November 30, 1996, and the related statement of operations, statement of
changes in net assets, and financial highlights for the period from
March 25, 1996 (commencement of operations) to November 30, 1996. These
financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on
these financial statements and financial highlights based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. Our procedures
included confirmation of securities owned as of November 30, 1996 by
correspondence with the custodian and brokers; and where confirmations
were not received from brokers, we performed other auditing procedures.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the financial statements and financial
highlights referred to above present fairly, in all material respects,
the financial position of Oppenheimer International Growth Fund as of
November 30, 1996 and the results of its operations, changes in its net
assets, and its financial highlights for the period from March 25, 1996
to November 30, 1996, in conformity with generally accepted accounting
principles.
KPMG PEAT MARWICK LLP
Denver, Colorado
December 20, 1996
17 Oppenheimer International Growth Fund
<PAGE> 18
OPPENHEIMER INTERNATIONAL GROWTH FUND
================================================================================
OFFICERS AND TRUSTEES
Leon Levy, Chairman of the Board of Trustees
Donald W. Spiro, Vice Chairman of the Board of Trustees
Bridget A. Macaskill, Trustee and President
Robert G. Galli, Trustee
Benjamin Lipstein, Trustee
Elizabeth B. Moynihan, Trustee
Kenneth A. Randall, Trustee
Edward V. Regan, Trustee
Russell S. Reynolds, Jr., Trustee
Sidney M. Robbins, Trustee
Pauline Trigere, Trustee
Clayton K. Yeutter, Trustee
George Evans, Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
================================================================================
INVESTMENT ADVISER
OppenheimerFunds, Inc.
================================================================================
DISTRIBUTOR
OppenheimerFunds Distributor, Inc.
================================================================================
TRANSFER AND SHAREHOLDER
SERVICING AGENT
OppenheimerFunds Services
================================================================================
CUSTODIAN OF
PORTFOLIO SECURITIES
The Bank of New York
================================================================================
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP
================================================================================
LEGAL COUNSEL
Gordon Altman Butowsky Weitzen Shalov & Wein
This is a copy of a report to shareholders of Oppenheimer International
Growth Fund. This report must be preceded or accompanied by a Prospectus
of Oppenheimer International Growth Fund. For material information
concerning the Fund, see the Prospectus. Shares of Oppenheimer funds
are not deposits or obligations of any bank, are not guaranteed by any
bank, and are not insured by the FDIC or any other agency, and involve
investment risks, including possible loss of the principal amount
invested.
18 Oppenheimer International Growth Fund
<PAGE> 19
RA6825.002.1196 January 31, 1997
