<PAGE>
THE BERGER FUNDS
SEMI-ANNUAL REPORT
March 31, 1998
[PHOTO]
BERGER NEW GENERATION FUND
BERGER SELECT FUND
BERGER SMALL COMPANY GROWTH FUND
BERGER SMALL CAP VALUE FUND
BERGER MID CAP GROWTH FUND
BERGER 100 FUND
BERGER/BIAM INTERNATIONAL FUND
BERGER GROWTH AND INCOME FUND
BERGER BALANCED FUND
<PAGE>
The Berger Funds are presenting a combined annual report which includes the
Berger New Generation Fund, Berger Select Fund, Berger Small Company Growth
Fund, Berger Small Cap Value Fund, Berger Mid Cap Growth Fund, Berger 100 Fund,
Berger BIAM/International Fund, Berger Growth and Income Fund, and Berger
Balanced Fund. This report reflects the financial position of each Fund at March
31, 1998 and the results of their operations and changes in their net assets for
the periods indicated, in a single document.
<PAGE>
<TABLE>
<C> <S>
2 A LETTER FROM THE PRESIDENT
THE BERGER FUNDS
4 Berger New Generation Fund
11 Berger Select Fund
16 Berger Small Company Growth Fund
23 Berger Small Cap Value Fund~Investor
Shares/Institutional Shares
29 Berger Mid Cap Growth Fund
35 Berger 100 Fund
41 Berger/BIAM International Fund
45 Berger Growth and Income Fund
52 Berger Balanced Fund
58 BERGER FUNDS NOTES TO FINANCIAL STATEMENTS
62 BERGER/BIAM INTERNATIONAL PORTFOLIO (TO BE READ IN
CONJUNCTION WITH THE BERGER/BIAM INTERNATIONAL
FUND)
67 BERGER/BIAM INTERNATIONAL PORTFOLIO NOTES TO
FINANCIAL STATEMENTS
70 FINANCIAL HIGHLIGHTS
</TABLE>
To obtain a prospectus for any of the Berger Funds, which contains more
complete information, including management fees, charges and expenses, call
1.800.333.1001. Please read it carefully before you invest. Berger
Distributors, Inc. ~ Distributor
[LOGO]
<PAGE>
A Letter from the President
DEAR
FELLOW
SHAREHOLDERS
I am happy to report
that, led by the dramatically
improved performance in the Berger 100 Fund, our Funds, both familiar
names and newcomers, are off to an excellent start in 1998(1).
Last year we at The Berger Funds dedicated ourselves to four important goals: 1)
recruit and develop world-class portfolio managers; 2) provide strong,
consistent performance across our family of funds; 3) expand our lineup of
no-load funds to offer you more choice; and 4) improve our shareholder services
and support. And, we have added a fifth: to make a real difference as a caring,
committed community leader.
OUR COMMUNITY
COMMITMENT
I am delighted with
our results on every
goal. Let me start
with the newest. We
know that in today's
complex world, it
takes all of us to
help our children
grow up safe and
strong. That's why we
at Berger feel so
strongly about our commitment to helping some
desperate kids. In addition to both corporate and
personal gifts, we also are donating the first year's
custodian fee for every Roth or traditional IRA opened
in 1998 to Covenant House, a non-profit agency
dedicated to providing care and support to runaway,
abandoned and homeless children. We are pleased and
proud to be able to work with Covenant House. We hope
you'll take this opportunity to build a solid
financial future for your family with a new Berger IRA
and at the same time help some very deserving kids.
WORLD-CLASS MANAGEMENT
I previously reported to you on the significant
progress we've made on each of our other goals, so I
want to highlight a few key achievements in the most
important area -- performance.
A year ago I promised you that we would dedicate
ourselves to improvement of the performance of the
Berger 100 Fund. Portfolio Manager Patrick Adams, who
joined us early last year, has done just that. Patrick
made the necessary moves to return the Fund to its
rightful place as a leader in its peer group. Halfway
through the 1998 fiscal year, the progress is
significant. With only the exception of a bout with
the "Asian flu" in the fourth quarter of 1997, the
Fund's performance has steadily improved. The Berger
100 Fund is up 42.3% for the 12-month period ended
3/31/98. For the first quarter it was up an impressive
18%. The WALL STREET JOURNAL recently featured Patrick
in a story on the turnaround of the Fund.
Bill Keithler, manager of our Small Company Growth and
New Generation Funds, continues to demonstrate the
small company expertise that has earned him national
recognition. The New Generation Fund, up 69% for the
12 months ended 3/31/98, recently was named as one of
the best funds for retirement in a KIPLINGER'S article
titled "Best Funds for Your Goals."(2) The Small
Company Growth Fund, which soon will be reopened to
new investors, is up 49.8% for the same period.
Our Berger Small Cap Value Fund had an impressive 1997
and, for the one-year period ended 3/31/98, shows a
return of 43.8%. USA TODAY recently ranked the Fund
and Portfolio Manager Bob Perkins as an "All Star"
fund for the second straight year.(3) The April issue
of MONEY featured Bob in an article titled "Funds Even
Stock Pickers Can Love," pointing out that "Perkins
has delivered market-beating returns with modest
volatility."
2
<PAGE>
NEW FUNDS STAND OUT
We added three new Berger Funds during the last half of 1997,
and I am pleased and proud to tell you that our newest funds
have proven to be robust additions to the family. The Berger
Balanced Fund, co-managed by Patrick Adams and John Jares,
was launched in October and registered a very strong debut,
up 37.9% for the fourth quarter of 1997, far outdistancing
every other fund in the peer group. The first quarter of this
year has seen no retreat with the Balanced Fund up 14.7%
year-to-date through 3/31/98, again at the top of its peer
group.
The Mid Cap Growth Fund, managed by Amy Selner, and the
Berger Select Fund, another Patrick Adams-managed Fund, were
launched just in time for 1998 and year-to-date are up 26%
and 37.1%, respectively, both well ahead of relevant indices
and at or near the top of their peer groups. We believe our
new funds are solidly positioned to continue their winning
ways.
DEDICATED TO THE LONG-TERM INVESTING
Our Berger/BIAM International Fund is performing well, up
16.5% for the 12 months ended 3/31/98, especially given
events in Asia. It's times like this that experienced
management counts. With more than 30 years' experience, the
BIAM team has successfully navigated through choppy
international waters many times before.
Although our Growth and Income Fund has continued to lag its
peer group, it has shown improvement, and we remain committed
to bringing this Fund up to the standards now being set by
others in our Berger family.
Providing our shareholders with solid across-the-board
performance in our funds remains our number one priority. All
of us, especially the portfolio management team, are
dedicated to achieving that goal. We plan to continue our
careful additions to the Berger Family, always with an eye
toward providing you with exciting, innovative yet
fundamentally sound funds that can help you build a healthy
financial future.
EXPANDING OUR SERVICES
Of the many improvements we've made recently to our
shareholder and information services, I want to mention two
of particular note. I encourage those of you who are online
to visit our improved and updated Web site at
WWW.BERGERFUNDS.COM. We continue to expand and upgrade the
site's features to make it most useful for you. Recent
additions include financial calculators to help you determine
your needs for retirement and college. If you haven't visited
us yet, give it a try; we'd love to know how you like it. We
have also dramatically expanded our services for financial
advisors. We understand many people turn to financial
advisors for guidance, and we are committed to providing
these professionals with first-rate information and service
to help them better understand their clients' needs and how
The Berger Funds can help to meet those needs.
As always, every single day we are
passionately dedicated to earning the trust
you place in us.
God bless you,
[/S/ JERRY LAVIN]
JERRY LAVIN
PRESIDENT
1. Past performance does not guarantee future
results. Investment returns and principal value
will fluctuate, and you may have a gain or loss
when you sell shares. To obtain the average
annual total returns for the Berger Funds for
the one-, five- and ten-year periods ended March
31, 1998, see the "Performance Overview" section
for each Fund in the semi-annual report that
follows. Because the Berger Balanced Fund, the
Berger Select Fund and the Berger Mid Cap Growth
Fund are new funds, they have only a short-term
performance history, which was obtained during a
period of generally rising markets.
2. KIPLINGER'S PERSONAL FINANCE MAGAZINE, March
1998, page 85. Kiplinger's selection criteria
included portfolio managers with consistently
above-average long-term performance records with
a commensurate level of risk, no
sales fee and a required minimum initial investment
of $3,000 or less.
3. USA TODAY, March 9, 1998. USA TODAY's selection
criteria included (i) only diversified funds that are
open to retail investors, (ii) solid long-term
performance, (iii) seasoned managers, (iv)
investments minimums of $5,000 or less and (v) sales
charges of 4.75% or less.
3
<PAGE>
BERGER
NEW GENERATION
FUND
PORTFOLIO MANAGER'S COMMENTARY WILLIAM KEITHLER
[BERGER NEW GENERATION FUND PHOTO]
PERFORMANCE
During the period from September 30, 1997, to March 31, 1998, the market was
highly volatile. It first dropped because of investors' concerns regarding the
financial crisis in Asia and its potential impact on the U.S. economy and stock
market, and then rose as fears abated and January earnings reports relieved at
least near-term anxieties regarding earnings growth. During this period, the
Berger New Generation Fund (the "Fund") delivered a total return of 4.76%,(1)
which underperformed the 17.21% return for the Standard & Poor's (S&P) 500(2)
and lagged the 6.37% gain for the Russell 2000.(3) Although our Fund is not
directly comparable to either of these market indices, it nevertheless is useful
to compare Fund performance with widely watched market indicators.
PERIOD IN REVIEW
In the highly volatile six-month period now behind us, our Fund displayed the
volatility characteristic of aggressive growth funds. During the fourth quarter
1997, in response to the Asian crisis, the market moved away from higher-risk,
smaller stocks such as those commonly found in our Fund. The overriding concerns
became liquidity risk and the "bigger is safer" mentality. As a result, our Fund
declined sharply during the quarter. The market's flight to larger stocks was
somewhat surprising because small companies generally have less direct exposure
to Asia (or foreign markets anywhere) and generally had (and have) above-average
prospects for earnings growth, while most large companies will be directly
impacted by Asia and have stock prices that are high by historic standards.
First quarter 1998 was almost the mirror image of the preceding quarter -- for
the market and our Fund. Once the market became comfortable with the news from
Asia and had a chance to see the impact of Asian events on a full quarter of
U.S. stock market performance, the risk aversion of the previous quarter
vanished, and investors broadened their interests to include smaller companies.
(We hasten to note, however, that Asia's impact will be gradual and could be
more profound later in the year.) Smaller stocks were quite attractive on a
valuation basis, particularly when compared with the larger cap, "index" stocks
in the S&P 500. Heightened confidence that earnings growth would likely be
realized caused investors to jump in with both feet. The results were very
strong smaller stock performance in February and March and good gains for our
Fund for the first quarter.
Telecommunication stocks, especially service and equipment companies, led the
way on the upside. Particularly strong performers were stocks of telephone
service providers that compete with established companies such as the Regional
Bells or AT&T. Stocks that performed well for our Fund include Intermedia
Communications, Nextel and NEXTLINK Communications in the local service market
and Primus Telecommunications and Startec Global Communications in the
international long-distance market. Internet companies whose business models are
based on advertising revenues were exceedingly strong in the quarter, partly
because of previously depressed valuations and earlier than expected
profitability. Our Fund benefited from its holdings in Internet companies such
as Yahoo!, America On-Line and Doubleclick. Other positive contributors were
computer service and consulting companies (Diamond Technology Partners and
Whitman-Hart) and outsourcing companies (Romac International, On Assignment,
Saville Systems PLC and Inspire Insurance Solutions).
Certain healthcare companies also performed well, including HBO and Co.,
Theragenics and Alza.
LOOKING AHEAD
We are cautiously optimistic about the future. The U.S. economy continues
strong. Although the Federal Reserve Board is concerned about Asia, we expect
interest rates to stay where they are for the near term. Inflation will likely
remain subdued, particularly given the recent decline in energy prices.
Importantly, relative earnings growth for small companies is very favorable, and
these companies are expected to grow earnings at roughly twice the rate of the
S&P 500. Finally, relative valuations (compared with the S&P 500) are compelling
because they are at only modestly higher levels than those associated with
bottoms in relative stock performance.
There are factors that give us pause, however, including high absolute
valuations for the market generally and for small cap stocks in particular, and
the high level of positive sentiment among investors, which could leave the
market vulnerable to disappointments. Having said this, it is noteworthy that
the market has "shrugged off" weak earnings forecasts by such significant
companies as Intel, Compaq and Motorola. We also note that following the recent
strong stock performance, many stocks are extended, which could indicate
short-term vulnerability.
Despite these concerns, we look for the remainder of the year to be challenging,
yet profitable. Thank you for your confidence in our Fund. We will continue to
work hard to earn it.
1. Performance figures are based on historical results and are not intended to
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.
2. The S&P 500 is an unmanaged index, with dividends reinvested, which consists
of the common stocks of 500 publicly traded U.S. companies. It is a generally
recognized indicator used to measure overall performance of the U.S. stock
market. One cannot invest directly in an index.
3. The Russell 2000 Index is an unmanaged index, with dividends reinvested,
which consists of common stocks of 2000 U.S. companies with market
capitalizations of $172 million to $1.1 billion. It is a generally recognized
indicator used to measure overall performance of small company stocks. One
cannot invest directly in an index.
4
<PAGE>
BERGER NEW GENERATION FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF
BERGER NEW GENERATION FUND VS.
S&P 500 INDEX AND
COST OF LIVING INDEX
BERGER NEW COST OF
GENERATION S&P 500 LIVING
FUND INDEX INDEX
<S> <C> <C> <C>
3/29/96 $10,000 $10,000 $10,000
9/30/96 $11,820 $10,791 $10,135
3/31/97 $9,643 $12,004 $10,276
9/30/97 $15,547 $15,153 $10,353
3/31/98 $16,286 $17,762 $10,398
Life of
BERGER NEW GENERATION FUND* Fund
AVERAGE ANNUAL TOTAL RETURN 1 Year (3/29/96)
As of March 31, 1998 68.89% 27.46%
*Performance figures are
historical and do not
represent future results.
Investment returns and
principal value will vary,
and you may have a loss when
you sell shares.
</TABLE>
5
<PAGE>
BERGER NEW GENERATION FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (97.50%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
COMMERCIAL SERVICES - ADVERTISING (4.82%)
22,000 Doubleclick, Inc.* $ 772,750
- --------------------------------------------------------------------------------
65,000 Outdoor Systems, Inc.* 2,279,062
- --------------------------------------------------------------------------------
60,000 TMP Worldwide, Inc.* 1,912,500
- --------------------------------------------------------------------------------
30,000 Universal Outdoor Holdings, Inc.* 1,935,000
- --------------------------------------------------------------------------------
6,899,312
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - BUSINESS SERVICES (2.44%)
80,000 First Consulting Group, Inc.* 1,650,000
- --------------------------------------------------------------------------------
63,750 Vincam Group, Inc.* 1,848,750
- --------------------------------------------------------------------------------
3,498,750
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - MISCELLANEOUS (4.66%)
25,000 Diamond Technology Partners, Inc.* 681,250
- --------------------------------------------------------------------------------
45,000 Forrester Research, Inc.* 1,597,500
- --------------------------------------------------------------------------------
90,000 Inspire Insurance Solutions, Inc.* 2,992,500
- --------------------------------------------------------------------------------
65,000 Profit Recovery Group International* 1,405,625
- --------------------------------------------------------------------------------
6,676,875
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - STAFFING (2.91%)
80,000 AHL Services, Inc.* 2,610,000
- --------------------------------------------------------------------------------
25,000 On Assignment, Inc.* 740,625
- --------------------------------------------------------------------------------
30,000 Romac International, Inc.* 825,000
- --------------------------------------------------------------------------------
4,175,625
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - EDUCATIONAL/ENTERTAINMENT (1.08%)
33,000 Electronic Arts, Inc.* 1,548,937
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - ENTERPRISE (4.22%)
20,000 Compuware Corporation* 987,500
- --------------------------------------------------------------------------------
32,000 Documentum, Inc.* 1,732,000
- --------------------------------------------------------------------------------
40,000 Keane, Inc.* 2,260,000
- --------------------------------------------------------------------------------
23,000 Sterling Commerce, Inc.* 1,066,625
- --------------------------------------------------------------------------------
6,046,125
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - FINANCE (1.60%)
50,000 Flexi International Software, Inc.* 625,000
- --------------------------------------------------------------------------------
75,000 Fundtech Limited* 1,350,000
- --------------------------------------------------------------------------------
20,000 Timberline Software Corporation 313,750
- --------------------------------------------------------------------------------
2,288,750
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - INTERNET (2.43%)
38,000 CNET, Inc.* 1,021,250
- --------------------------------------------------------------------------------
15,000 Earthlink Network, Inc.* 846,562
- --------------------------------------------------------------------------------
25,000 Exodus Communication Inc.* 700,000
- --------------------------------------------------------------------------------
23,500 ISS Group, Inc.* 913,562
- --------------------------------------------------------------------------------
3,481,374
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - MEDICAL (0.82%)
35,000 Quadramed Corporation* 1,168,125
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (97.50%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
COMPUTER SOFTWARE - SECURITY (2.54%)
65,000 Axent Technologies, Inc.* $ 1,982,500
- --------------------------------------------------------------------------------
25,000 Network Associates, Inc.* 1,656,250
- --------------------------------------------------------------------------------
3,638,750
- --------------------------------------------------------------------------------
COMPUTER - INTEGRATED SYSTEMS (0.85%)
75,000 Discreet Logic, Inc.* 1,223,437
- --------------------------------------------------------------------------------
COMPUTER - LOCAL NETWORKS (2.01%)
40,000 Ascend Communications, Inc.* 1,515,000
- --------------------------------------------------------------------------------
70,000 Daou Systems, Inc.* 1,369,375
- --------------------------------------------------------------------------------
2,884,375
- --------------------------------------------------------------------------------
COMPUTER - MEMORY DEVICES (1.22%)
70,000 Sandisk Corporation* 1,741,250
- --------------------------------------------------------------------------------
COMPUTER - PERIPHERAL EQUIPMENT (2.51%)
65,000 Digi International, Inc.* 1,791,562
- --------------------------------------------------------------------------------
30,000 Micros Systems, Inc.* 1,803,750
- --------------------------------------------------------------------------------
3,595,312
- --------------------------------------------------------------------------------
COMPUTER - SERVICES (10.63%)
24,000 America Online, Inc.* 1,639,500
- --------------------------------------------------------------------------------
30,000 Consentrix Systems* 585,000
- --------------------------------------------------------------------------------
40,000 HBO & Company 2,415,000
- --------------------------------------------------------------------------------
65,000 Metro Information Services, Inc.* 2,218,125
- --------------------------------------------------------------------------------
19,000 Shared Medical Systems Corporation 1,489,125
- --------------------------------------------------------------------------------
42,400 Technology Solutions Company* 1,123,600
- --------------------------------------------------------------------------------
110,000 Tier Technologies* 1,897,500
- --------------------------------------------------------------------------------
44,300 Whittman-Hart, Inc.* 2,004,575
- --------------------------------------------------------------------------------
20,000 Yahoo, Inc.* 1,848,750
- --------------------------------------------------------------------------------
15,221,175
- --------------------------------------------------------------------------------
COSMETICS/PERSONAL CARE (0.31%)
20,000 Nutraceutical International Corporation* 440,000
- --------------------------------------------------------------------------------
ELECTRONIC PRODUCTS - MISCELLANEOUS (1.16%)
125,000 Power Integrations, Inc.* 1,656,250
- --------------------------------------------------------------------------------
ELECTRONIC - LASER SYSTEMS/COMPONENTS (0.42%)
30,000 Cymer, Inc.* 605,625
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR EQUIPMENT (1.87%)
40,000 ATMI, Inc.* 1,210,000
- --------------------------------------------------------------------------------
35,000 Uniphase Corporation* 1,472,187
- --------------------------------------------------------------------------------
2,682,187
- --------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
BERGER NEW GENERATION FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (97.50%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
ELECTRONIC - SEMICONDUCTOR MANUFACTURING (3.64%)
25,000 Advanced Micro Devices* $ 726,562
- --------------------------------------------------------------------------------
20,000 Linear Technology Corporation 1,380,000
- --------------------------------------------------------------------------------
40,000 Maxim Integrated Products, Inc.* 1,457,500
- --------------------------------------------------------------------------------
50,000 Sipex Corporation* 1,650,000
- --------------------------------------------------------------------------------
5,214,062
- --------------------------------------------------------------------------------
FINANCE - CONSUMER/COMMERCIAL LOANS (0.95%)
50,000 Medallion Financial Corp. 1,356,250
- --------------------------------------------------------------------------------
FINANCE - SAVINGS & LOAN (0.94%)
48,500 Ocwen Financial Corporation* 1,345,875
- --------------------------------------------------------------------------------
FINANCIAL SERVICES - MISCELLANEOUS (0.73%)
100,000 Medaphis Corporation* 1,043,750
- --------------------------------------------------------------------------------
INSURANCE - PROPERTY/CASUALTY/TITLE (0.92%)
97,300 American Safety Insurance Group* 1,313,550
- --------------------------------------------------------------------------------
LEISURE - HOTELS & MOTELS (0.63%)
47,500 Trendwest Resorts, Inc.* 896,562
- --------------------------------------------------------------------------------
MEDIA - CABLE TV (2.42%)
35,000 Comcast Corporation 1,214,062
- --------------------------------------------------------------------------------
48,750 TCI Ventures Class A* 856,171
- --------------------------------------------------------------------------------
45,000 Tele-Communications, Inc. Class A* 1,399,218
- --------------------------------------------------------------------------------
3,469,451
- --------------------------------------------------------------------------------
MEDIA - TV/RADIO (1.03%)
25,000 Jacor Communications, Inc.* 1,475,000
- --------------------------------------------------------------------------------
MEDICAL - BIOMED/GENETICS (0.88%)
35,000 Gilead Sciences, Inc.* 1,260,000
- --------------------------------------------------------------------------------
MEDICAL - ETHICAL DRUGS (3.56%)
40,000 Alza Corporation* 1,792,500
- --------------------------------------------------------------------------------
44,000 Forest Laboratories, Inc.* 1,650,000
- --------------------------------------------------------------------------------
26,000 Theragenics Corporation* 1,655,875
- --------------------------------------------------------------------------------
5,098,375
- --------------------------------------------------------------------------------
MEDICAL - GENERIC DRUGS (0.96%)
60,000 Mylan Laboratories 1,380,000
- --------------------------------------------------------------------------------
MEDICAL - HOSPITALS (1.21%)
30,000 Universal Health Services, Inc.* 1,732,500
- --------------------------------------------------------------------------------
MEDICAL - INSTRUMENTS (0.71%)
40,000 Schick Technologies, Inc.* 1,020,000
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (97.50%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
MEDICAL - NURSING HOMES (1.21%)
80,000 Assisted Living Concepts, Inc.* $ 1,730,000
- --------------------------------------------------------------------------------
MEDICAL - OUTPATIENT/HOME CARE (1.19%)
45,000 Harbinger Corporation* 1,698,750
- --------------------------------------------------------------------------------
MEDICAL - PRODUCTS (2.66%)
60,000 Pharmacyclics, Inc.* 1,747,500
- --------------------------------------------------------------------------------
20,000 Quintiles Transnational Corporation* 963,750
- --------------------------------------------------------------------------------
50,000 Sterigenics International, Inc.* 1,100,000
- --------------------------------------------------------------------------------
3,811,250
- --------------------------------------------------------------------------------
MEDICAL/DENTAL - SUPPLIES (1.02%)
27,000 Steris Corporation* 1,458,000
- --------------------------------------------------------------------------------
METAL ORES - GOLD/SILVER (1.92%)
144,100 Battle Mountain Gold Co. 918,637
- --------------------------------------------------------------------------------
29,100 Newmont Gold Company 911,193
- --------------------------------------------------------------------------------
30,000 Newmont Mining Corporation 916,875
- --------------------------------------------------------------------------------
2,746,705
- --------------------------------------------------------------------------------
OIL & GAS - DRILLING (1.07%)
50,000 Noble Drilling Corporation* 1,528,125
- --------------------------------------------------------------------------------
OIL & GAS - FIELD SERVICES (2.64%)
60,000 Stolt Comex Seaway SA* 1,511,250
- --------------------------------------------------------------------------------
45,000 Veritas DGC, Inc.* 2,275,312
- --------------------------------------------------------------------------------
3,786,562
- --------------------------------------------------------------------------------
POLLUTION CONTROL - SERVICES (2.71%)
40,000 American Disposal Services, Inc.* 1,510,000
- --------------------------------------------------------------------------------
40,000 Superior Services, Inc.* 1,247,500
- --------------------------------------------------------------------------------
80,000 Waterlink, Inc.* 1,120,000
- --------------------------------------------------------------------------------
3,877,500
- --------------------------------------------------------------------------------
RETAIL - DEPARTMENT STORES (1.91%)
30,000 Consolidated Stores Corporation* 1,288,125
- --------------------------------------------------------------------------------
40,000 Proffitts, Inc.* 1,450,000
- --------------------------------------------------------------------------------
2,738,125
- --------------------------------------------------------------------------------
RETAIL - SUPER/MINI MARKETS (1.22%)
25,000 Whole Foods Market, Inc.* 1,743,750
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - EQUIPMENT (1.67%)
200,000 Intelect Communications, Inc.* 1,387,500
- --------------------------------------------------------------------------------
35,000 Remec, Inc.* 1,004,072
- --------------------------------------------------------------------------------
2,391,572
- --------------------------------------------------------------------------------
</TABLE>
7
<PAGE>
BERGER NEW GENERATION FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (97.50%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
TELECOMMUNICATIONS - SERVICES (11.23%)
40,000 Applied Micro Circuits Corporation* $ 900,000
- --------------------------------------------------------------------------------
35,000 Intermedia Communications, Inc.* 2,786,875
- --------------------------------------------------------------------------------
50,000 LCI International, Inc.* 1,925,000
- --------------------------------------------------------------------------------
60,000 Nextel Communications, Inc.* 2,025,000
- --------------------------------------------------------------------------------
50,000 NEXTLINK Communications, Inc.* 1,606,250
- --------------------------------------------------------------------------------
80,000 Primus Telecommunications Group, Inc.* 2,320,000
- --------------------------------------------------------------------------------
30,000 Saville Systems PLC* 1,537,500
- --------------------------------------------------------------------------------
80,000 Startech Global Communications Corporation* 2,000,000
- --------------------------------------------------------------------------------
23,000 Worldcom, Inc.* 990,437
- --------------------------------------------------------------------------------
16,091,062
- --------------------------------------------------------------------------------
Total Common Stock
(cost $103,051,808) 139,679,010
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
REPURCHASE AGREEMENT (3.09%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
$4,425,000 Repurchase agreement with State Street Bank,
5.70% dated March 31, 1998, to be repurchased
at $4,425,701 on April 1, 1998, collateralized
by U.S. Treasury Bond, 6.75% - June 25, 2005,
with a value of $4,517,800
(Cost $4,425,000) $ 4,425,000
- --------------------------------------------------------------------------------
Total Repurchase Agreement
(cost $4,425,000) 4,425,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments
(cost $107,476,808) (100.59%) 144,104,010
- --------------------------------------------------------------------------------
Liabilities, Less Other Assets (-0.59%) (849,565)
- --------------------------------------------------------------------------------
Net Assets (100.00%) $ 143,254,445
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Non-income producing security
PLC Public Limited Company
See notes to financial statements.
8
<PAGE>
BERGER NEW GENERATION FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at cost $ 107,476,808
- --------------------------------------------------------------------------------
Investments, at value $ 144,104,010
- --------------------------------------------------------------------------------
Cash 330
- --------------------------------------------------------------------------------
Receivables
Investment securities sold 3,800,553
- --------------------------------------------------------------------------------
Fund shares sold 1,146,601
- --------------------------------------------------------------------------------
Dividends 7,190
- --------------------------------------------------------------------------------
Interest 701
- --------------------------------------------------------------------------------
Other Assets 949
- --------------------------------------------------------------------------------
Total Assets 149,060,334
- --------------------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 5,403,257
- --------------------------------------------------------------------------------
Fund shares redeemed 162,547
- --------------------------------------------------------------------------------
Accrued investment advisory fees 106,113
- --------------------------------------------------------------------------------
Accrued custodian fees 265
- --------------------------------------------------------------------------------
Accrued transfer agent fees 39,721
- --------------------------------------------------------------------------------
Accrued 12b-1 fees 29,476
- --------------------------------------------------------------------------------
Accrued audit fees 7,603
- --------------------------------------------------------------------------------
Accrued administrative service fees 1,179
- --------------------------------------------------------------------------------
Accrued shareholder reports 54,075
- --------------------------------------------------------------------------------
Other accrued expenses 1,653
- --------------------------------------------------------------------------------
Total Liabilities 5,805,889
- --------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $ 143,254,445
- --------------------------------------------------------------------------------
Capital Shares
Authorized (Par Value $0.01) Unlimited
- --------------------------------------------------------------------------------
Shares Outstanding 9,287,953
- --------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE $ 15.42
- --------------------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
INCOME
Dividends $ 35,531
- --------------------------------------------------------------------------------
Interest 161,574
- --------------------------------------------------------------------------------
Total Income 197,105
- --------------------------------------------------------------------------------
EXPENSES
Investment advisory fees 631,176
- --------------------------------------------------------------------------------
Administrative services fee 7,013
- --------------------------------------------------------------------------------
Accounting fees 9,813
- --------------------------------------------------------------------------------
Custodian fees 13,289
- --------------------------------------------------------------------------------
Transfer agent fees 225,271
- --------------------------------------------------------------------------------
Registration fees 38,676
- --------------------------------------------------------------------------------
12b-1 fees 175,327
- --------------------------------------------------------------------------------
Audit fees 20,103
- --------------------------------------------------------------------------------
Legal fees 3,649
- --------------------------------------------------------------------------------
Directors'/Trustees' fees and expenses 5,871
- --------------------------------------------------------------------------------
Reports to shareholders 84,112
- --------------------------------------------------------------------------------
Other expenses 35,001
- --------------------------------------------------------------------------------
Total Expenses 1,249,301
- --------------------------------------------------------------------------------
Less fees paid indirectly 0
- --------------------------------------------------------------------------------
Less earnings credits (17,599)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Expenses, Net 1,231,702
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net Investment Income (loss) (1,034,597)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on securities and foreign currency
transactions 10,438,711
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on
securities and foreign currency transactions (7,811,263)
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments and
Foreign Currency Transactions 2,627,448
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 1,592,851
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
9
<PAGE>
BERGER NEW GENERATION FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months
Ended 3/31/98 Year Ended
(Unaudited) 9/30/97
- ---------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (1,034,597) $ (1,616,800)
- ---------------------------------------------------------------------------------
Net realized gain (loss) on securities and
foreign currency transactions 10,438,711 5,045,424
- ---------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions (7,811,263) 30,175,000
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 1,592,851 33,603,624
- ---------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income 0 (5,581,496)
- ---------------------------------------------------------------------------------
Net realized gains on investments 0 0
- ---------------------------------------------------------------------------------
Net Decrease in Net Assets from Dividends and
Distributions to Shareholders 0 (5,581,496)
- ---------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 95,840,115 188,057,448
- ---------------------------------------------------------------------------------
Net asset value of shares issued in reinvestment
of distributions 0 5,397,637
- ---------------------------------------------------------------------------------
Payments for shares redeemed (144,342,564) (148,221,185)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived
from Fund Share Transactions (48,502,449) 45,233,900
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets (46,909,598) 73,256,028
- ---------------------------------------------------------------------------------
NET ASSETS
Beginning of period 190,164,043 116,908,015
- ---------------------------------------------------------------------------------
End of period $ 143,254,445 $ 190,164,043
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $ 105,261,347 $ 153,763,796
- ---------------------------------------------------------------------------------
Undistributed net investment income (loss) (1,041,862) (7,265)
- ---------------------------------------------------------------------------------
Undistributed net realized gain (loss) from
investments 2,407,758 (8,030,953)
- ---------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
securities and foreign currency transactions 36,627,202 44,438,465
- ---------------------------------------------------------------------------------
Total $ 143,254,445 $ 190,164,043
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<S> <C> <C>
Shares sold 6,795,279 15,166,296
- ---------------------------------------------------------------------------------
Shares issued to shareholders in reinvestment of
distributions 0 498,856
- ---------------------------------------------------------------------------------
Shares repurchased (10,425,506) (12,636,703)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Shares (3,630,227) 3,028,449
- ---------------------------------------------------------------------------------
Shares outstanding, beginning of period 12,918,180 9,889,731
- ---------------------------------------------------------------------------------
Shares outstanding, end of period 9,287,953 12,918,180
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
10
<PAGE>
BERGER
SELECT
FUND
PORTFOLIO MANAGER'S COMMENTARY PATRICK S. ADAMS
[BERGER SELECT FUND PHOTO]
PERFORMANCE
The Berger Select Fund (the "Fund"), which commenced operations on December 31,
1997, performed very well for shareholders in its first quarter. Our Fund's
total return for the three-month period ended March 31, 1998, was 37.10%(1)
compared with 13.94% for the Standard & Poor's (S&P) 500.(2) This outstanding
return placed the Fund among the top performers for all equity funds.
PERIOD IN REVIEW
These outstanding results are a testament to our Fund's investment approach. The
Berger Select Fund is a nondiversified fund focusing on growth companies. This
generally means that we seek to achieve our objective of capital appreciation by
taking relatively larger positions in a smaller number of securities. Our core
portfolio usually will number 20 to 30 stocks. This allows us to capitalize on
our stock-selection abilities. Position sizes in the portfolio can be
significantly larger than 5% of total assets. During the quarter we invested
Fund assets in stocks that were also owned by our flagship Berger 100 Fund. But,
in the Berger Select Fund, we took relatively larger positions in these stocks.
We focus on stocks with a proven track record and superior potential for
earnings growth that is not yet fully reflected in the company's stock price.
Our primary sector focus for the fund will be in technology, consumer,
healthcare and financials. During the quarter we focused our attention on
technology and consumer stocks but also had outstanding returns from financial
stocks. Technology bounced back strongly after suffering through the "Asian flu"
in the fourth quarter of 1997. Consumer cyclicals, particularly retailers and
apparel manufacturers, benefited from the second mildest winter on record since
1894.
Some of the stocks that we owned in the portfolio that had outstanding returns
were Parametric Technology, Cadence Design Systems, Nokia, Chase Manhattan, The
Money Store and Republic Industries.
LOOKING AHEAD
Our bottom-up approach continues to direct investments toward areas such as
technology and consumer cyclicals that are somewhat sensitive to the economy. We
believe the U.S. economy will remain strong, and companies with this sensitivity
are more likely to produce upside earnings surprises.
Thank you for your investment in the Berger Select Fund.
1. Performance figures are based on historical results and are not intended to
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.
2. The S&P 500 is an unmanaged index, with dividends reinvested, which consists
of the common stocks of 500 publicly traded U.S. companies. It is a generally
recognized indicator used to measure overall performance of the U.S. stock
market. One cannot invest directly in an index.
11
<PAGE>
BERGER SELECT FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF BERGER SELECT
FUND VS. S&P 500 INDEX AND COST OF LIVING INDEX
BERGER COST OF
SELECT S&P 500 LIVING
FUND INDEX INDEX
<S> <C> <C> <C>
12/31/97 $10,000 $10,000 $10,000
1/31/98 $11,120 $10,114 $10,019
2/28/98 $12,780 $10,840 $10,037
3/31/98 $13,710 $11,394 $10,037
BERGER SELECT FUND*
TOTAL RETURN
As of March 31, 1998
Life of Fund 37.10%
(12/31/97)
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares.
</TABLE>
12
<PAGE>
BERGER SELECT FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (53.75%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
COMPUTER SOFTWARE - ENTERPRISE (1.05%)
7,400 Parametric Technology Corporation* $ 246,512
- --------------------------------------------------------------------------------
COMPUTER - GRAPHICS (1.63%)
11,000 Cadence Design Systems, Inc.* 380,875
- --------------------------------------------------------------------------------
COMPUTER - MAINFRAMES (4.44%)
10,000 International Business Machines Corporation 1,038,750
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR MANUFACTURING (10.38%)
25,000 Maxim Integrated Products, Inc.* 910,937
- --------------------------------------------------------------------------------
20,000 Micron Technology, Inc.* 581,250
- --------------------------------------------------------------------------------
25,000 Xilinx, Inc.* 935,937
- --------------------------------------------------------------------------------
2,428,124
- --------------------------------------------------------------------------------
FOOD - FLOUR & GRAIN (8.29%)
60,000 Interstate Bakeries Corporation 1,938,750
- --------------------------------------------------------------------------------
HOUSEHOLD - HOUSEWARES (3.41%)
18,100 Sunbeam Corporation 797,531
- --------------------------------------------------------------------------------
LEISURE - GAMING (4.15%)
25,000 GTECH Holdings Corporation* 971,875
- --------------------------------------------------------------------------------
OIL & GAS - DRILLING (1.94%)
10,000 Diamond Offshore Drilling, Inc. 453,750
- --------------------------------------------------------------------------------
POLLUTION CONTROL - EQUIPMENT (3.00%)
20,000 United States Filter Corporation* 702,500
- --------------------------------------------------------------------------------
POLLUTION CONTROL - SERVICES (1.66%)
15,000 Republic Industries, Inc.* 387,187
- --------------------------------------------------------------------------------
RETAIL - APPAREL/SHOE (3.77%)
20,000 Ross Stores, Inc. 882,500
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (53.75%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
RETAIL/WHOLESALE - AUTO PARTS (2.90%)
20,000 Autozone, Inc.* $ 677,500
- --------------------------------------------------------------------------------
TOBACCO (7.13%)
40,000 Philip Morris Companies, Inc. 1,667,504
- --------------------------------------------------------------------------------
Total Common Stock
(Cost $12,277,454) 12,573,358
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
U.S. GOVERNMENT AGENCY OBLIGATIONS (30.74%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
$ 4,000,000 Federal Home Loan Mortgage Corporation - 5.44%
4/13/98 3,992,746
- --------------------------------------------------------------------------------
2,200,000 Federal Home Loan Mortgage Corporation - 5.80%
4/1/98 2,200,000
- --------------------------------------------------------------------------------
1,000,000 Federal National Mortgage Association - 5.47%
4/13/98 998,176
- --------------------------------------------------------------------------------
Total U.S. Government Agency Obligations
(Cost $7,190,922) 7,190,922
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
REPURCHASE AGREEMENT (4.86%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
1,137,000 Repurchase agreement with State Street Bank,
5.70% dated March 31, 1998, to be repurchased
at $1,137,180 on April 1, 1998, collateralized
by U.S. Treasury Bond, 5.52% - August 1, 2022,
with a value of $1,161,300
(Cost $1,137,000) 1,137,000
- --------------------------------------------------------------------------------
Total Repurchase Agreement
(Cost $1,137,000) 1,137,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments (Cost $20,605,376) (89.35%) 20,901,280
- --------------------------------------------------------------------------------
Other assets, less liabilities (10.65%) 2,491,621
- --------------------------------------------------------------------------------
Net Assets (100.00%) $ 23,392,901
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Non-income producing security.
See notes to financial statements.
13
<PAGE>
BERGER SELECT FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at cost $20,605,376
- --------------------------------------------------------------------------------
Investments, at value $20,901,280
- --------------------------------------------------------------------------------
Cash 562
- --------------------------------------------------------------------------------
Receivables
Investment securities sold 8,087,918
- --------------------------------------------------------------------------------
Fund shares sold 119,696
- --------------------------------------------------------------------------------
Dividends 5,400
- --------------------------------------------------------------------------------
Interest 180
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Assets 29,115,036
- --------------------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 5,686,136
- --------------------------------------------------------------------------------
Fund shares redeemed 2,000
- --------------------------------------------------------------------------------
Accrued investment advisory fees 13,998
- --------------------------------------------------------------------------------
Accrued custodian fees 5,732
- --------------------------------------------------------------------------------
Accrued transfer agent fees 1,105
- --------------------------------------------------------------------------------
Accrued 12b-1 fees 4,666
- --------------------------------------------------------------------------------
Accrued audit fees 3,514
- --------------------------------------------------------------------------------
Accrued administrative service fees 187
- --------------------------------------------------------------------------------
Accrued shareholder reports 84
- --------------------------------------------------------------------------------
Other accrued expenses 4,713
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Liabilities 5,722,135
- --------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $23,392,901
- --------------------------------------------------------------------------------
Capital Shares
Authorized (Par Value $0.01) Unlimited
- --------------------------------------------------------------------------------
Shares Outstanding 1,706,468
- --------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE $ 13.71
- --------------------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Period From
December 31, 1997* to
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Income
Dividends $ 11,806
- --------------------------------------------------------------------------------
Interest 90,551
- --------------------------------------------------------------------------------
Total Income 102,357
- --------------------------------------------------------------------------------
EXPENSES
Investment advisory fees 27,149
- --------------------------------------------------------------------------------
Administrative services fee 362
- --------------------------------------------------------------------------------
Accounting fees 2,250
- --------------------------------------------------------------------------------
Custodian fees 6,348
- --------------------------------------------------------------------------------
Transfer agent fees 1,883
- --------------------------------------------------------------------------------
Registration fees 6,017
- --------------------------------------------------------------------------------
12b-1 fees 9,050
- --------------------------------------------------------------------------------
Audit fees 3,514
- --------------------------------------------------------------------------------
Legal fees 37
- --------------------------------------------------------------------------------
Directors'/Trustees' fees and expenses 238
- --------------------------------------------------------------------------------
Reports to shareholders 905
- --------------------------------------------------------------------------------
Total Expenses 57,753
- --------------------------------------------------------------------------------
Less fees paid indirectly (900)
- --------------------------------------------------------------------------------
Less earnings credits (244)
- --------------------------------------------------------------------------------
Total Expenses, Net 56,609
- --------------------------------------------------------------------------------
Net investment income (loss) 45,748
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on securities and foreign
currency transactions 4,073,723
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on
securities and foreign currency transactions 295,904
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments
and Foreign Currency Transactions 4,369,627
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 4,415,375
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
See notes to financial statements.
14
<PAGE>
BERGER SELECT FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Period from
12/31/97* to
3/31/98
(Unaudited)
- ----------------------------------------------------------------
<S> <C>
OPERATIONS:
Net investment income (loss) $ 45,748
- ----------------------------------------------------------------
Net realized gain (loss) on securities and foreign
currency transactions 4,073,723
- ----------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions 295,904
- ----------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 4,415,375
- ----------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income 0
- ----------------------------------------------------------------
Net realized gains on investments 0
- ----------------------------------------------------------------
Net Decrease in Net Assets from Dividends and
Distributions to Shareholders 0
- ----------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 20,451,429
- ----------------------------------------------------------------
Net asset value of shares issued in reinvestment
of distributions 0
- ----------------------------------------------------------------
Payments for shares redeemed (1,473,903)
- ----------------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived from
Fund Share Transactions 18,977,526
- ----------------------------------------------------------------
Net Increase (Decrease) in Net Assets 23,392,901
- ----------------------------------------------------------------
NET ASSETS
Beginning of period 0
- ----------------------------------------------------------------
End of period $ 23,392,901
- ----------------------------------------------------------------
- ----------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $ 18,977,526
- ----------------------------------------------------------------
Undistributed net investment income (loss) 45,748
- ----------------------------------------------------------------
Undistributed net realized gain (loss) from
investments 4,073,723
- ----------------------------------------------------------------
Net unrealized appreciation (depreciation) of
securities and foreign currency transactions 295,904
- ----------------------------------------------------------------
Total $ 23,392,901
- ----------------------------------------------------------------
- ----------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<S> <C>
Shares sold 1,824,871
- ----------------------------------------------------------------
Shares issued to shareholders in reinvestment of
distributions 0
- ----------------------------------------------------------------
Shares repurchased (118,403)
- ----------------------------------------------------------------
Net Increase (Decrease) in Shares 1,706,468
- ----------------------------------------------------------------
Shares outstanding, beginning of period 0
- ----------------------------------------------------------------
Shares outstanding, end of period 1,706,468
- ----------------------------------------------------------------
- ----------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
See notes to financial statements.
15
<PAGE>
BERGER
SMALL COMPANY
GROWTH FUND
PORTFOLIO MANAGER'S COMMENTARY WILLIAM KEITHLER
[BERGER SMALL COMPANY GROWTH FUND PHOTO]
PERFORMANCE
The market was highly volatile the past six months. It first dropped because of
investors' concerns regarding the financial crisis in Asia and its potential
impact on the U.S. economy and stock market, and then rose as fears abated and
January earnings reports relieved at least near-term anxieties regarding
earnings growth. Between September 30, 1997, and March 31, 1998, the Berger
Small Company Growth Fund's (the "Fund") 5.97%(1) total return narrowly lagged
the 6.37% return of the Russell 2000.(2) The Russell 2000-Growth index (a more
accurate comparison for our Fund) was up 2.71% for the six-month period ending
March 31, 1998.
PERIOD IN REVIEW
In the highly volatile six-month period now behind us, our Fund displayed the
volatility characteristic of aggressive growth funds. During the fourth quarter
1997, in response to the Asian crisis, the market moved away from higher-risk,
smaller stocks such as those commonly found in our Fund. The overriding concerns
became liquidity risk and the "bigger is safer" mentality. As a result, our Fund
declined sharply during the quarter. The market's flight to larger stocks was
somewhat surprising because small companies generally have less direct exposure
to Asia (or foreign markets anywhere) and generally had (and have) above-average
prospects for earnings growth, while most large companies will be directly
impacted by Asia and have stock prices that are high by historic standards.
First quarter 1998 was almost the mirror image of the preceding quarter -- for
the market and our Fund. Once the market became comfortable with the news from
Asia and had a chance to see the impact of Asian events on a full quarter of
U.S. stock market performance, the risk aversion of the previous quarter
vanished, and investors broadened their interests to include smaller companies.
(We hasten to note, however, that Asia's impact will be gradual and could be
more profound later in the year.) Smaller stocks were quite attractive on a
valuation basis, particularly when compared with the larger cap, "index" stocks
in the Standard & Poor's (S&P) 500. Heightened confidence that earnings growth
would likely be realized caused investors to jump in with both feet. The results
were very strong smaller stock performance in February and March and good gains
for our Fund for the first quarter.
Stocks of both traditional and "new age" media companies led the way on the
upside. Thanks to continued strength in ad placements, stocks of radio companies
such as Clear Channel Communications and Chancellor Media and of outdoor
advertisers such as Lamar Advertising and Universal Outdoor were very strong
performers. Certain Internet companies whose business models are based on
advertising revenues turned in impressive gains in the quarter, partly because
of previously depressed valuations and earlier than expected profitability. Our
Fund benefited from holdings in Internet companies such as Yahoo!, CMG
Information Services, Lycos, Infoseek and Icon CMT. We believe the media sector
has the potential to become quite large in coming years, and investors are
placing their bets on companies early.
Other contributors to positive performance for our Fund this period were:
computer service and consulting companies (Cambridge Technology Partners and CBT
Group PLC-ADR.); outsourcing companies (Select Appointments PLC and Ciber Inc.);
certain healthcare companies (Total Renal Care Holdings and Renal Care Group);
as well as an outsourcing company (Boron, Lepore and Associates); and select
telecommunications companies (Winstar Communications and ICG Communications),
which offer local telephone service in competition with Regional Bell companies.
LOOKING AHEAD
We are cautiously optimistic about the future. The U.S. economy continues
strong. Although the Federal Reserve Board is concerned about Asia, we expect
interest rates to stay where they are for the near term. Inflation will likely
remain subdued, particularly given the recent decline in energy prices.
Importantly, relative earnings growth for small companies is very favorable, and
these companies are expected to grow earnings at roughly twice the rate of the
S&P 500. Finally, relative valuations (compared with the S&P 500) are compelling
because they are at only modestly higher levels than those associated with
bottoms in relative stock performance.
There are factors that give us pause, however, including high absolute
valuations for the market generally and for small cap stocks in particular, and
the high level of positive investor sentiment, which could leave the market
vulnerable to disappointments. Having said this, it is noteworthy that the
market "shrugged off" weak earnings forecasts by such significant companies as
Intel, Compaq and Motorola. We also note that, following the recent strong stock
performance, many stocks are extended, which could indicate short-term
vulnerability.
Despite these concerns, we look for the remainder of the year to be challenging,
yet profitable. Thank you for your confidence in our Fund. We will continue to
work hard to earn it.
1. Performance figures are based on historical results and are not intended to
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.
2. Russell 2000 Index is an unmanaged index, with dividends reinvested, which
consists of common stocks of 2000 U.S. companies with market capitalizations of
$172 million to $1.1 billion. It is a generally recognized indicator used to
measure overall performance of small company stocks. One cannot invest directly
in an index.
16
<PAGE>
BERGER SMALL COMPANY GROWTH FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF
BERGER SMALL COMPANY GROWTH FUND VS.
RUSSELL 2000 INDEX AND COST OF LIVING INDEX
BERGER
SMALL RUSSELL COST OF
COMPANY 2000 LIVING
GROWTH FUND INDEX INDEX
<S> <C> <C> <C>
12/30/93 $10,000 $10,000 $10,000
3/31/94 $10,120 $9,734 $10,096
3/31/95 $11,734 $10,271 $10,384
3/31/96 $16,179 $13,254 $10,679
3/31/97 $15,800 $13,931 $10,974
3/31/98 $23,671 $19,784 $11,125
BERGER SMALL COMPANY GROWTH FUND*
AVERAGE ANNUAL TOTAL RETURN
AS OF MARCH 31, 1998
1 Year 49.81%
Life of Fund 22.48%
(12/30/93)
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares.
</TABLE>
17
<PAGE>
BERGER SMALL COMPANY GROWTH FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (94.48%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
COMMERCIAL SERVICES - ADVERTISING (1.24%)
300,000 Lamar Advertising Company* $ 10,500,000
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - MISCELLANEOUS (2.62%)
265,000 Boron Lepore & Associates* 8,778,125
- --------------------------------------------------------------------------------
150,000 CMG Information Services, Inc.* 8,690,625
- --------------------------------------------------------------------------------
300,100 FPA Medical Management, Inc.* 4,632,793
- --------------------------------------------------------------------------------
22,101,543
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - SCHOOLS (1.03%)
255,500 Devry, Inc.* 8,734,906
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - STAFFING (4.04%)
236,400 AHL Services, Inc.* 7,712,550
- --------------------------------------------------------------------------------
380,000 Labor Ready, Inc.* 12,231,250
- --------------------------------------------------------------------------------
230,000 Renaissance Worldwide, Inc.* 6,310,625
- --------------------------------------------------------------------------------
310,000 Select Appointments ADR* 7,827,500
- --------------------------------------------------------------------------------
34,081,925
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - EDUCATIONAL/ENTERTAINMENT (1.78%)
290,000 CBT Group PLC ADR* 15,007,500
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - ENTERPRISE (0.66%)
100,000 Aspen Technology, Inc.* 4,125,000
- --------------------------------------------------------------------------------
200 Baan Company N.V.* 9,575
- --------------------------------------------------------------------------------
81,100 Inso Corporation* 1,439,525
- --------------------------------------------------------------------------------
5,574,100
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - INTERNET (1.46%)
510,000 Infoseek Corporation* 9,211,875
- --------------------------------------------------------------------------------
141,500 USWeb Corporation* 3,130,687
- --------------------------------------------------------------------------------
12,342,562
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - MEDICAL (1.11%)
280,000 Quadramed Corporation* 9,345,000
- --------------------------------------------------------------------------------
COMPUTER - GRAPHICS (0.63%)
110,000 Applied Graphics Technologies, Inc.* 5,293,750
- --------------------------------------------------------------------------------
COMPUTER - INTEGRATED SYSTEMS (0.47%)
100,000 Wind River Systems, Inc.* 3,975,000
- --------------------------------------------------------------------------------
COMPUTER - LOCAL NETWORKS (0.81%)
350,000 Daou Systems, Inc.* 6,846,875
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (94.48%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
COMPUTER - SERVICES (12.80%)
225,000 Cambridge Technology Partners, Inc.* $ 11,151,562
- --------------------------------------------------------------------------------
174,400 Ciber, Inc.* 12,197,100
- --------------------------------------------------------------------------------
432,600 Docucorp International, Inc.* 4,271,925
- --------------------------------------------------------------------------------
5,000 Gartner Group, Inc.* 186,875
- --------------------------------------------------------------------------------
210,000 HBO & Company 12,678,750
- --------------------------------------------------------------------------------
645,000 Icon CMT Corporation* 9,997,500
- --------------------------------------------------------------------------------
290,000 Lycos, Inc.* 12,832,500
- --------------------------------------------------------------------------------
195,000 Quick Response Services, Inc.* 10,432,500
- --------------------------------------------------------------------------------
266,100 Technology Solutions Company* 7,051,650
- --------------------------------------------------------------------------------
325,000 Whittman-Hart, Inc.* 14,706,250
- --------------------------------------------------------------------------------
135,000 Yahoo, Inc.* 12,479,062
- --------------------------------------------------------------------------------
107,985,674
- --------------------------------------------------------------------------------
COSMETICS/PERSONAL CARE (3.36%)
127,400 Nature's Bounty, Inc.* 7,739,550
- --------------------------------------------------------------------------------
389,300 Rexall Sundown, Inc.* 13,260,531
- --------------------------------------------------------------------------------
182,100 Twin Lab Corporation* 7,375,050
- --------------------------------------------------------------------------------
28,375,131
- --------------------------------------------------------------------------------
DIVERSIFIED OPERATIONS (0.99%)
115,650 Pittway Corporation Class A 8,326,800
- --------------------------------------------------------------------------------
ELECTRONIC - MEASURING INSTRUMENTS (1.60%)
272,200 Genrad, Inc.* 8,455,212
- --------------------------------------------------------------------------------
101,025 Waters Corporation* 5,044,935
- --------------------------------------------------------------------------------
13,500,147
- --------------------------------------------------------------------------------
ELECTRONIC - MISCELLANEOUS COMPONENTS (3.14%)
495,000 Chicago Miniature Lamp, Inc.* 19,243,125
- --------------------------------------------------------------------------------
340,000 Leitch Technology Corporation* 7,283,232
- --------------------------------------------------------------------------------
26,526,357
- --------------------------------------------------------------------------------
ELECTRONIC - PARTS DISTRIBUTORS (0.50%)
200,000 Kent Electronics Corporation* 4,212,500
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR EQUIPMENT (2.57%)
130,000 Etec Systems, Inc.* 7,670,000
- --------------------------------------------------------------------------------
407,200 Integrated Process Equipment Co.* 8,194,900
- --------------------------------------------------------------------------------
50,000 Kulicke & Soffa Industries, Inc.* 1,087,500
- --------------------------------------------------------------------------------
150,000 PRI Automation, Inc.* 3,928,125
- --------------------------------------------------------------------------------
40,000 Silicon Valley Group, Inc.* 780,000
- --------------------------------------------------------------------------------
21,660,525
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR MANUFACTURING (1.43%)
300,000 Maxim Integrated Products, Inc.* 10,931,250
- --------------------------------------------------------------------------------
123,800 Tower Semiconductor Ltd.*# 1,129,675
- --------------------------------------------------------------------------------
12,060,925
- --------------------------------------------------------------------------------
</TABLE>
18
<PAGE>
BERGER SMALL COMPANY GROWTH FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (94.48%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
FINANCE - CONSUMER/COMMERCIAL LOANS (2.33%)
250,000 Safeguard Scientifics, Inc.* $ 9,406,250
- --------------------------------------------------------------------------------
342,000 Sirrom Capital Corporation 10,281,375
- --------------------------------------------------------------------------------
19,687,625
- --------------------------------------------------------------------------------
FINANCE - EQUITY REIT (0.60%)
122,100 CCA Prison Realty Trust 5,059,518
- --------------------------------------------------------------------------------
FINANCE - INVESTMENT MANAGEMENT (0.66%)
160,000 Affiliated Managers Group, Inc.* 5,580,000
- --------------------------------------------------------------------------------
FINANCIAL SERVICES - MISCELLANEOUS (1.09%)
258,900 Pre-Paid Legal Services, Inc.* 9,190,950
- --------------------------------------------------------------------------------
FUNERAL SERVICES & RELATED (1.55%)
235,000 Stewart Enterprises, Inc. 13,071,875
- --------------------------------------------------------------------------------
HOUSEHOLD - OFFICE/FURNITURE (3.12%)
205,000 Compx International, Inc.* 4,791,875
- --------------------------------------------------------------------------------
310,000 Herman Miller, Inc. 10,394,687
- --------------------------------------------------------------------------------
290,100 Knoll, Inc.* 11,186,981
- --------------------------------------------------------------------------------
26,373,543
- --------------------------------------------------------------------------------
INSURANCE - ACCIDENT & HEALTH (1.25%)
455,000 Healthcare Recoveries, Inc.* 10,578,750
- --------------------------------------------------------------------------------
LEISURE - HOTELS & MOTELS (0.87%)
462,400 Suburban Lodges of America, Inc.* 7,340,600
- --------------------------------------------------------------------------------
LEISURE - PRODUCTS (0.43%)
150,000 North Face, Inc.* 3,637,500
- --------------------------------------------------------------------------------
LEISURE/SERVICES (0.45%)
228,400 Royal Olympic Cruise Lines, Inc.* 3,825,700
- --------------------------------------------------------------------------------
MEDIA - TV/RADIO (7.28%)
440,000 Chancellor Media Corporation* 20,185,000
- --------------------------------------------------------------------------------
150,000 Clear Channel Communications* 14,700,000
- --------------------------------------------------------------------------------
304,000 Cox Radio, Inc.* 14,744,000
- --------------------------------------------------------------------------------
130,000 Emmis Broadcasting Corporation* 6,857,500
- --------------------------------------------------------------------------------
151,500 Scandinavian Broadcast Systems* 4,999,500
- --------------------------------------------------------------------------------
61,486,000
- --------------------------------------------------------------------------------
MEDICAL - BIOMED/GENETICS (2.23%)
201,600 Incyte Pharmaceuticals, Inc.* 9,424,800
- --------------------------------------------------------------------------------
170,000 Medimmune, Inc.* 9,371,250
- --------------------------------------------------------------------------------
18,796,050
- --------------------------------------------------------------------------------
MEDICAL - DRUG/DIVERSIFIED (0.49%)
193,100 Shire Pharmaceuticals ADR* 4,139,581
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (94.48%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
MEDICAL - ETHICAL DRUGS (3.03%)
240,000 Jones Medical Industries, Inc. $ 8,685,000
- --------------------------------------------------------------------------------
125,000 Medicis Pharmaceutical Corporation* 5,453,125
- --------------------------------------------------------------------------------
180,000 Theragenics Corporation* 11,463,750
- --------------------------------------------------------------------------------
25,601,875
- --------------------------------------------------------------------------------
MEDICAL - MEDICAL/DENTAL SERVICES (1.35%)
300,000 Renal Care Group, Inc.* 11,400,000
- --------------------------------------------------------------------------------
MEDICAL - OUTPATIENT/HOME CARE (1.91%)
150,000 Harbinger Corporation* 5,662,500
- --------------------------------------------------------------------------------
20,000 Phycor, Inc.* 451,250
- --------------------------------------------------------------------------------
299,999 Total Renal Care Holdings, Inc.* 9,993,716
- --------------------------------------------------------------------------------
16,107,466
- --------------------------------------------------------------------------------
MEDICAL - PRODUCTS (0.34%)
92,500 Parexel International Corporation* 2,890,625
- --------------------------------------------------------------------------------
MEDICAL/DENTAL - SUPPLIES (1.45%)
300,000 Mentor Corporation 8,287,500
- --------------------------------------------------------------------------------
100,000 Omnicare, Inc. 3,962,500
- --------------------------------------------------------------------------------
12,250,000
- --------------------------------------------------------------------------------
OIL & GAS - DRILLING (0.96%)
150,000 Atwood Oceanics, Inc.* 8,109,375
- --------------------------------------------------------------------------------
OIL & GAS - FIELD SERVICES (2.12%)
200,000 BJ Services Co.* 7,287,500
- --------------------------------------------------------------------------------
209,100 Veritas DGC, Inc.* 10,572,618
- --------------------------------------------------------------------------------
17,860,118
- --------------------------------------------------------------------------------
OIL & GAS - MACHINERY & EQUIPMENT (0.90%)
294,000 Varco International, Inc.* 7,570,500
- --------------------------------------------------------------------------------
OIL & GAS - US EXPLORATION & PRODUCTION (0.96%)
290,160 Ocean Energy, Inc.* 6,836,895
- --------------------------------------------------------------------------------
32,400 St. Mary Land & Exploration Co. 1,238,287
- --------------------------------------------------------------------------------
8,075,182
- --------------------------------------------------------------------------------
POLLUTION CONTROL - SERVICES (4.13%)
450,000 Allied Waste Industries, Inc.* 11,235,937
- --------------------------------------------------------------------------------
317,000 Eastern Environmental Services, Inc.* 8,043,875
- --------------------------------------------------------------------------------
472,000 Newpark Resources, Inc.* 8,614,000
- --------------------------------------------------------------------------------
287,500 Tetra Tech, Inc.* 6,971,875
- --------------------------------------------------------------------------------
34,865,687
- --------------------------------------------------------------------------------
REAL ESTATE OPERATIONS (0.91%)
350,000 Fairfield Communities, Inc.* 7,721,875
- --------------------------------------------------------------------------------
</TABLE>
19
<PAGE>
BERGER SMALL COMPANY GROWTH FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (94.48%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
RETAIL - APPAREL/SHOE (2.68%)
450,000 Just For Feet, Inc.* $ 9,168,750
- --------------------------------------------------------------------------------
106,700 Men's Wearhouse, Inc.* 3,947,900
- --------------------------------------------------------------------------------
230,000 Pacific Sunwear of California, Inc.* 9,545,000
- --------------------------------------------------------------------------------
22,661,650
- --------------------------------------------------------------------------------
RETAIL - MAIL ORDER/DIRECT (2.15%)
165,000 Black Box Corporation* 6,084,375
- --------------------------------------------------------------------------------
390,000 Onsale, Inc.* 12,090,000
- --------------------------------------------------------------------------------
18,174,375
- --------------------------------------------------------------------------------
RETAIL - MISCELLANEOUS/DIVERSIFIED (0.80%)
180,000 Michaels Stores, Inc.* 6,727,500
- --------------------------------------------------------------------------------
RETAIL - RESTAURANTS (1.03%)
320,100 Dave & Buster's, Inc.* 8,682,712
- --------------------------------------------------------------------------------
RETAIL - SUPER/MINI MARKETS (1.42%)
337,500 Wild Oats Markets, Inc.* 12,023,448
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - EQUIPMENT (0.56%)
70,000 Comverse Technology, Inc.* 3,421,250
- --------------------------------------------------------------------------------
40,000 Metromedia Fiber Network, Inc.* 1,345,000
- --------------------------------------------------------------------------------
4,766,250
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - SERVICES (2.62%)
335,000 ICG Communications, Inc.* 12,478,750
- --------------------------------------------------------------------------------
225,000 Winstar Communications, Inc.* 9,618,750
- --------------------------------------------------------------------------------
22,097,500
- --------------------------------------------------------------------------------
TEXTILE MILL/HOUSEHOLD (0.55%)
170,000 Novel Denim Holdings Ltd.* 4,653,750
- --------------------------------------------------------------------------------
Total Common Stock
(Cost $463,852,899) 797,458,800
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
REPURCHASE AGREEMENT (3.29%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
$ 27,747,000 Repurchase agreement with State Street Bank,
5.70% dated March 31, 1998, to be repurchased
at $27,751,393 on April 1, 1998,
collateralized by U.S. Treasury Bond, 6.75% -
April 2, 1998, with a value of $28,304,254
(Cost $27,747,000) 27,747,000
- --------------------------------------------------------------------------------
Total Repurchase Agreement
(Cost $27,747,000) 27,747,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
US GOVERNMENT AGENCY OBLIGATIONS (0.94%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
$ 8,000,000 Federal Home Loan Mortgage Corporation
Discount Note - 5.43% 4/20/98 $ 7,977,073
- --------------------------------------------------------------------------------
Total US Government Agency Obligations
(Cost $7,977,073) 7,977,073
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
PREFERRED STOCK (0.35%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
COMPUTER - PERIPHERAL EQUIPMENT (0.35%)
665,000 Candescent Technologies Corporation* X@ 2,992,500
- --------------------------------------------------------------------------------
Total Preferred Stock
(Cost $3,657,500) 2,992,500
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments (Cost $503,234,472) (99.06%) 836,175,373
- --------------------------------------------------------------------------------
Other assets, less liabilities (0.94%) 7,898,356
- --------------------------------------------------------------------------------
Net Assets (100.00%) $ 844,073,729
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
ADR - American Depository Receipts
PLC - Public limited company.
* Non-income producing security.
@ - Valued in good faith.
# The Investment Company Act of 1940 defines affiliates as those companies in
which a fund holds 5% or more of the outstanding voting securities. Following is
a summary of the transactions with the affiliated party for the six months ended
March 31, 1998:
<TABLE>
<CAPTION>
Tower
Semiconductor
- ------------------------------------------------------------------
<S> <C>
Market Value at 9/30/97 $ 12,918,750
- ------------------------------------------------------------------
Purchases at Cost 0
- ------------------------------------------------------------------
Sales at Cost 5,570,216
- ------------------------------------------------------------------
Change in Unrealized Appreciation/(Depreciation) (6,218,859)
- ------------------------------------------------------------------
Market Value at 3/31/98 1,129,675
- ------------------------------------------------------------------
Dividend Income 0
- ------------------------------------------------------------------
Realized Gain (Loss) (334,817)
- ------------------------------------------------------------------
</TABLE>
XSCHEDULE OF RESTRICTED OR ILLIQUID SECURITIES
<TABLE>
<CAPTION>
Fair Value as a
Security Name Date Acquired Cost Fair Value % of Net Assets
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Candescent Technologies Corporation
Series E Preferred Stock 5/1/96 $3,657,500 $2,992,500 0.35%
</TABLE>
See notes to financial statements.
20
<PAGE>
BERGER SMALL COMPANY GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at cost $ 503,234,472
- --------------------------------------------------------------------
Investments, at value $ 836,175,373
- --------------------------------------------------------------------
Cash 1,499,080
- --------------------------------------------------------------------
Receivables
Investment securities sold 17,179,854
- --------------------------------------------------------------------
Fund shares sold 630,834
- --------------------------------------------------------------------
Dividends 99,071
- --------------------------------------------------------------------
Interest 4,393
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Total Assets 855,588,605
- --------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 9,518,277
- --------------------------------------------------------------------
Fund shares redeemed 726,623
- --------------------------------------------------------------------
Accrued investment advisory fees 635,442
- --------------------------------------------------------------------
Accrued custodian fees 24,961
- --------------------------------------------------------------------
Accrued transfer agent fees 329,081
- --------------------------------------------------------------------
Accrued 12b-1 fees 18,345
- --------------------------------------------------------------------
Accrued audit fees 9,597
- --------------------------------------------------------------------
Accrued administrative service fees 7,061
- --------------------------------------------------------------------
Accrued shareholder reports 245,489
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Total Liabilities 11,514,876
- --------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $ 844,073,729
- --------------------------------------------------------------------
Capital Shares
Authorized (Par Value $0.01) Unlimited
- --------------------------------------------------------------------
Shares Outstanding 166,061,929
- --------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER
SHARE $ 5.08
- --------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998
(Unaudited)
- ---------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Income
Dividends $ 376,672
- ---------------------------------------------------------------------
Interest 1,206,305
- ---------------------------------------------------------------------
Total Income 1,582,977
- ---------------------------------------------------------------------
Expenses
- ---------------------------------------------------------------------
Investment advisory fees 3,589,420
- ---------------------------------------------------------------------
Administrative services fee 39,882
- ---------------------------------------------------------------------
Accounting fees 41,961
- ---------------------------------------------------------------------
Custodian fees 37,922
- ---------------------------------------------------------------------
Transfer agent fees 1,115,176
- ---------------------------------------------------------------------
Registration fees 35,491
- ---------------------------------------------------------------------
12b-1 fees 356,064
- ---------------------------------------------------------------------
Audit fees 26,097
- ---------------------------------------------------------------------
Legal fees 26,140
- ---------------------------------------------------------------------
Directors'/Trustees' fees and expenses 34,670
- ---------------------------------------------------------------------
Reports to shareholders 463,069
- ---------------------------------------------------------------------
Other expenses 47,973
- ---------------------------------------------------------------------
Total Expenses 5,813,865
- ---------------------------------------------------------------------
Less fees paid indirectly (15,675)
- ---------------------------------------------------------------------
Less earnings credits (34,878)
- ---------------------------------------------------------------------
Total Expenses, Net 5,763,312
- ---------------------------------------------------------------------
Net Investment Income (Loss) (4,180,335)
- ---------------------------------------------------------------------
- ---------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS
Net realized gain (loss) on securities and foreign
currency transactions 47,705,661
- ---------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions (4,454,084)
- ---------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currency Transactions 43,251,577
- ---------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS $ 39,071,242
- ---------------------------------------------------------------------
- ---------------------------------------------------------------------
</TABLE>
See notes to financial statements.
21
<PAGE>
BERGER SMALL COMPANY GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months
Ended 3/31/98 Year Ended
(Unaudited) 9/30/97
- ---------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (4,180,335) $ (8,257,780)
- ---------------------------------------------------------------------------------
Net realized gain (loss) on securities and
foreign currency transactions 47,705,661 78,747,991
- ---------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions (4,454,084) 48,945,864
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 39,071,242 119,436,075
- ---------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income 0 0
- ---------------------------------------------------------------------------------
Net realized gains on investments (77,784,978) (34,716,279)
- ---------------------------------------------------------------------------------
Net Decrease in Net Assets from Dividends and
Distributions to Shareholders (77,784,978) (34,716,279)
- ---------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 147,526,073 413,578,028
- ---------------------------------------------------------------------------------
Net asset value of shares issued in reinvestment
of distributions 75,634,398 33,942,130
- ---------------------------------------------------------------------------------
Payments for shares redeemed (243,057,744) (501,022,213)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived
from Fund Share Transactions (19,897,273) (53,502,055)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets (58,611,009) 31,217,741
- ---------------------------------------------------------------------------------
NET ASSETS
Beginning of period 902,684,738 871,466,997
- ---------------------------------------------------------------------------------
End of period $844,073,729 $ 902,684,738
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $484,198,774 $ 504,096,047
- ---------------------------------------------------------------------------------
Undistributed net investment income (loss) (4,217,288) (36,953)
- ---------------------------------------------------------------------------------
Undistributed net realized gain (loss) from
investments 31,151,342 61,230,659
- ---------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
securities and foreign currency transactions 332,940,901 337,394,985
- ---------------------------------------------------------------------------------
Total $844,073,729 $ 902,684,738
- ---------------------------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<S> <C> <C>
Shares sold 30,550,915 92,035,384
- ---------------------------------------------------------------------------------
Shares issued to shareholders in reinvestment of
distributions 17,507,950 8,062,261
- ---------------------------------------------------------------------------------
Shares repurchased (51,240,296) (114,558,245)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Shares (3,181,431) (14,460,600)
- ---------------------------------------------------------------------------------
Shares outstanding, beginning of period 169,243,360 183,703,960
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Shares outstanding, end of period 166,061,929 169,243,360
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
22
<PAGE>
BERGER
SMALL CAP
VALUE FUND
PORTFOLIO MANAGER'S COMMENTARY ROBERT H. PERKINS
[BERGER SMALL CAP VALUE FUND PHOTO]
PERFORMANCE
For the six-month period ending March 31, 1998, the Berger Small Cap Value Fund
(the "Fund") had a total return of 9.58%(1) (investor shares) and 9.78%(1)
(institutional shares), which lagged the returns of 11.75% and 17.21%,
respectively, for the Dow Jones Industrial Average(2) and S&P 500,(2) and
outperformed the 6.37% gain registered by the Russell 2000(3) index over the
same period.
These differences in gains serve to highlight the market inefficiencies that can
occur over the short term. In periods of uncertainty, investors put liquidity (a
hallmark of large cap stocks) above relative value. We believe that investors
who recognize the opportunities presented during these times of inefficiency can
benefit from the long-term trend of outperformance by small cap investments.
PERIOD IN REVIEW
Flat Fund performance in the fourth quarter 1997, the result of extreme
volatility caused by difficulties in Asian economies, was the key reason our
Fund did not keep pace with the broad market indexes for the six-month period.
Fund performance was stronger in the first quarter 1998, but was held back by
the market's preference for large cap growth stocks in January and February. As
a result, valuations in the small cap market on March 31 remained at very low
levels compared with large cap valuations, especially those of higher-growth
stocks.
Our bank and savings and loan holdings underperformed the general market because
of concerns over a flat yield curve and potentially lower earnings growth in
case of an economic slowdown. We believe these concerns have been fully
discounted by the 15-17 times earnings multiples among bank and savings and loan
stocks, and by the continuing consolidation in the industry. Two of our Fund's
holdings -- CFX Corporation and Life Financial -- are in the process of being
acquired by other financial institutions. Approximately 12 of our bank and
savings and loan holdings have been bought out since 1996.
We doubled our exposure to Real Estate Investment Trusts (REITs) because the
yield disparity between REITs and Treasury bonds reached historically high
levels. REIT yields, which historically trail those of Treasury bonds, were 7-8%
compared with 6% for bonds.
We increased our commitment to "fallen" growth stocks, which we define as stocks
of companies that have declined 50-75% in price because of a temporary
interruption in earnings growth, are selling at 2-4 times cash and have no debt.
Some of our fallen growth stock investments this reporting period include
Speedfam International, XIRCON, Splash Technology, Brooks Automation and CFM
Technologies.
In order to take advantage of strength among consumer stocks, we sold our
holdings in West Marine, Bob Evans, Blair and Cavalier when they reached price
earnings ratios of 20-25 times earnings.
As of March 31, our Fund's weighted market capitalization was slightly more than
$500 million, and the average price/earnings ratio was 15 times 1999 estimated
earnings. The latter figure excludes communications, natural resources and REITs
because these sectors use different financial yardsticks.
LOOKING AHEAD
Going forward, we continue to like small banks and savings and loans, a sector
in which we have long invested, and with some success. Consequently, we plan to
take advantage of the relative weakness in the group to rebuild our Fund's
exposure to it. We also plan to continue our investment in fallen growth stocks.
We strongly believe that the risk/reward ratio of investment in these stocks is
extremely favorable.
We appreciate your investment in the Berger Small Cap Value Fund.
1. Performance figures are based on historical results and are not intended to
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.
2. Dow Jones Industrial Average and the S&P 500 are unmanaged indexes, with
dividends reinvested. One cannot invest directly in an index.
3. The Russell 2000 Index is an unmanaged index, with dividends reinvested,
which consists of common stocks of 2000 U.S. companies with market
capitalizations of $172 million to $1.1 billion. It is a generally recognized
indicator used to measure overall performance of small company stocks. One
cannot invest directly in an index.
23
<PAGE>
BERGER SMALL CAP VALUE FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
INVESTOR SHARES
COMPARISON OF CHANGE IN VALUE OF
BERGER SMALL CAP VALUE FUND VS.
RUSSELL 2000 INDEX AND COST OF LIVING INDEX
BERGER SMALL
CAP RUSSELL COST OF
VALUE FUND 2000 LIVING
INVESTOR SHARES INDEX INDEX
<S> <C> <C> <C>
3/31/88 $10,000 $10,000 $10,000
3/31/89 $11,595 $11,307 $10,498
3/31/90 $12,879 $11,931 $11,047
3/31/91 $12,581 $12,750 $11,588
3/31/92 $13,873 $15,428 $11,957
3/31/93 $16,780 $17,722 $12,326
3/31/94 $18,531 $19,666 $12,635
3/31/95 $21,211 $20,751 $12,996
3/31/96 $25,256 $26,779 $13,365
3/31/97 $31,518 $28,147 $13,734
3/31/98 $45,345 $39,973 $13,923
BERGER SMALL CAP VALUE FUND*
AVERAGE ANNUAL TOTAL RETURN
As of March 31, 1998
1 Year 5 Year 10 Year
43.87% 22.00% 16.32%
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares. Performance
data for the Investor Shares include
periods prior to the adoption of class
designations on February 14, 1997, and
therefore do not reflect the 0.25% per year
12b-1 fee applicable to the Investor Shares.
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
INSTITUTIONAL SHARES
COMPARISON OF CHANGE IN VALUE OF BERGER SMALL
CAP VALUE FUND VS.
RUSSELL 2000 INDEX AND COST OF LIVING INDEX
BERGER SMALL
CAP
VALUE FUND RUSSELL COST OF
INSTITUTIONAL 2000 LIVING
SHARES INDEX INDEX
<S> <C> <C> <C>
3/31/88 $250,000 $250,000 $250,000
3/31/89 $289,886 $282,684 $262,446
3/31/90 $321,983 $298,284 $276,180
3/31/91 $314,518 $318,757 $289,700
3/31/92 $346,816 $385,706 $298,927
3/31/93 $419,492 $443,048 $308,155
3/31/94 $463,280 $491,651 $315,880
3/31/95 $530,274 $518,786 $324,893
3/31/96 $631,393 $669,479 $334,120
3/31/97 $788,414 $703,671 $343,348
3/31/98 $1,138,195 $999,316 $348,069
BERGER SMALL CAP VALUE FUND*
AVERAGE ANNUAL TOTAL RETURN
As of March 31, 1998
1 Year 5 Year 10 Year
44.37% 22.10% 16.37%
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares.
</TABLE>
24
<PAGE>
BERGER SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (84.21%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
AUTO/TRUCK - ORIGINAL EQUIPMENT (1.56%)
200,000 Simpson Industries, Inc. $ 2,800,000
- --------------------------------------------------------------------------------
BANKS - NORTHEAST (4.52%)
50,000 Banknorth Group, Inc. 3,650,000
- --------------------------------------------------------------------------------
140,000 CFX Corporation 4,462,500
- --------------------------------------------------------------------------------
8,112,500
- --------------------------------------------------------------------------------
BANKS - SOUTHEAST (4.01%)
65,000 CCB Financial Corporation 7,186,562
- --------------------------------------------------------------------------------
BUILDING - CONSTRUCTION PRODUCTS/MISCELLANEOUS (1.80%)
152,400 Juno Lighting, Inc. 3,219,450
- --------------------------------------------------------------------------------
COMPUTER - LOCAL NETWORKS (2.31%)
300,000 Xircom, Inc.* 4,143,750
- --------------------------------------------------------------------------------
COMPUTER - OPTICAL RECOGNITION (1.86%)
300,000 Robotic Vision Systems, Inc.* 3,337,500
- --------------------------------------------------------------------------------
COMPUTER - PERIPHERAL EQUIPMENT (2.84%)
85,000 Eltron International, Inc.* 2,082,500
- --------------------------------------------------------------------------------
180,000 Splash Technology Holdings, Inc.* 3,015,000
- --------------------------------------------------------------------------------
5,097,500
- --------------------------------------------------------------------------------
CONSUMER PRODUCTS - MISCELLANEOUS (4.82%)
360,000 Jostens, Inc. 8,640,000
- --------------------------------------------------------------------------------
DIVERSIFIED OPERATIONS (4.29%)
338,000 Federal Signal Corporation 7,689,500
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR MANUFACTURING (0.77%)
220,000 Oak Technology, Inc. 1,388,750
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR EQUIPMENT (5.53%)
230,000 Brooks Automation, Inc.* 3,622,500
- --------------------------------------------------------------------------------
110,000 CFM Technologies, Inc. 1,643,125
- --------------------------------------------------------------------------------
180,000 Speedfam International, Inc.* 4,646,250
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
9,911,875
- --------------------------------------------------------------------------------
FINANCE - EQUITY REIT (7.62%)
200,000 Associated Estates Realty Corp. 4,175,000
- --------------------------------------------------------------------------------
263,900 IRT Property Co. 3,067,837
- --------------------------------------------------------------------------------
200,000 Summit Properties, Inc. 4,025,000
- --------------------------------------------------------------------------------
140,000 Town & Country Trust 2,388,750
- --------------------------------------------------------------------------------
13,656,587
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (84.21%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
FINANCE - SAVINGS & LOANS (6.98%)
215,000 Life Financial Corp. $ 4,300,000
- --------------------------------------------------------------------------------
80,000 Mech Financial, Inc.* 2,440,000
- --------------------------------------------------------------------------------
220,000 Riverview Bancorp, Inc. 3,726,250
- --------------------------------------------------------------------------------
81,000 Warren Bancorp Inc. 2,045,250
- --------------------------------------------------------------------------------
12,511,500
- --------------------------------------------------------------------------------
MACHINE - TOOLS & RELATED PRODUCTS (0.43%)
90,800 PPT Vision, Inc.* 771,800
- --------------------------------------------------------------------------------
MEDIA - CABLE TV (4.25%)
200,000 Jones Intercable Class A* 3,650,000
- --------------------------------------------------------------------------------
230,000 Jones Intercable, Inc.* 3,967,500
- --------------------------------------------------------------------------------
7,617,500
- --------------------------------------------------------------------------------
MEDIA - NEWSPAPERS (3.94%)
425,000 Hollinger International, Inc. 7,065,625
- --------------------------------------------------------------------------------
MEDIA - PERIODICALS (2.05%)
210,000 Playboy Enterprises, Inc.* 3,675,000
- --------------------------------------------------------------------------------
MEDICAL - WHOLESALE DRUG/SUNDRIES (1.84%)
270,000 Perrigo Company 3,307,500
- --------------------------------------------------------------------------------
OIL & GAS - US EXPLORATION & PRODUCTION (4.36%)
180,000 Chieftain International, Inc.* 4,275,000
- --------------------------------------------------------------------------------
185,000 Seagull Energy Corporation* 3,549,687
- --------------------------------------------------------------------------------
7,824,687
- --------------------------------------------------------------------------------
RETAIL - APPAREL/SHOE (1.82%)
160,000 Just For Feet, Inc. 3,260,000
- --------------------------------------------------------------------------------
RETAIL - HOME FURNISHINGS (1.41%)
180,000 Heilig-Meyers Co. 2,531,250
- --------------------------------------------------------------------------------
RETAIL - MAIL ORDER & DIRECT (1.37%)
428,600 Spiegel, Inc. Class A* 2,464,450
- --------------------------------------------------------------------------------
RETAIL/WHOLESALE - BUILDING PRODUCTS (1.57%)
160,000 Eagle Hardware & Garden, Inc.* 2,820,000
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - CELLULAR (3.25%)
221,500 Centennial Cellular Corp. Class A* 5,821,296
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - SERVICES (3.54%)
800,000 General Communication, Inc. 6,350,000
- --------------------------------------------------------------------------------
TEXTILE - MILL/HOUSEHOLD (0.84%)
161,300 Congoleum Corporation* 1,512,187
- --------------------------------------------------------------------------------
TRANSPORTATION - SHIP (4.61%)
290,000 Knightsbridge Tankers Ltd. 8,265,000
- --------------------------------------------------------------------------------
Total Common Stock
(Cost $129,853,145) 150,981,769
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
25
<PAGE>
BERGER SMALL CAP VALUE FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
INVESTMENT COMPANIES (6.46%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
FINANCE - PUBLIC INVESTMENT FUND FOREIGN (6.46%)
130,000 Central European Value Fund, Inc. $ 1,673,750
- --------------------------------------------------------------------------------
250,000 Emerging Markets Telecommunications Fund,
Inc. 3,750,000
- --------------------------------------------------------------------------------
115,000 GT Global Eastern Europe Fund, Inc. 1,415,937
- --------------------------------------------------------------------------------
226,700 Latin America Equity Fund, Inc. 3,102,956
- --------------------------------------------------------------------------------
150,000 Scudder New Asia Fund, Inc. 1,640,625
- --------------------------------------------------------------------------------
Total Investment Companies
(Cost $12,406,570) 11,583,268
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
REPURCHASE AGREEMENT (5.17%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
$ 9,277,000 Repurchase agreement with State Street Bank,
5.70% dated March 31, 1998, to be repurchased
at $9,278,469 on April 1, 1998,
collateralized by U.S. Treasury Bond, 6.75% -
April 10, 1998, with a value of $9,466,275
(Cost $9,277,000) 9,277,000
- --------------------------------------------------------------------------------
Total Repurchase Agreement
(Cost $9,277,000) 9,277,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
US GOVERNMENT AGENCY OBLIGATIONS (5.02%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
$ 4,000,000 Federal Home Loan Mortgage Corporation
Discount Note - 5.48% 4/14/98 $ 3,992,088
- --------------------------------------------------------------------------------
5,000,000 Federal National Mortgage Association
Discount Note - 5.47% 4/13/98 4,990,883
- --------------------------------------------------------------------------------
Total US Government Agency Obligations
(Cost $8,982,967) 8,982,971
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments (Cost $160,519,682) (100.86%) 180,825,008
- --------------------------------------------------------------------------------
Other liabilities, less other assets (-0.86%) (1,537,968)
- --------------------------------------------------------------------------------
Net Assets (100.00%) $ 179,287,040
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Non-income producing security.
See notes to financial statements.
26
<PAGE>
BERGER SMALL CAP VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments at cost $160,519,682
- --------------------------------------------------------------------------------
Investments at value $180,825,008
- --------------------------------------------------------------------------------
Cash 41
- --------------------------------------------------------------------------------
Receivables
Fund shares sold 1,994,025
- --------------------------------------------------------------------------------
Interest 1,469
- --------------------------------------------------------------------------------
Dividends 118,066
- --------------------------------------------------------------------------------
Total Assets 182,938,609
- --------------------------------------------------------------------------------
LIABILITIES
Payables
Fund shares redeemed 55,936
- --------------------------------------------------------------------------------
Investment securities purchased 3,373,042
- --------------------------------------------------------------------------------
Accrued investment advisory fees 127,812
- --------------------------------------------------------------------------------
Accrued custodian fees 6,623
- --------------------------------------------------------------------------------
Accrued shareholder reports 5,327
- --------------------------------------------------------------------------------
Accrued 12b-1 fees 18,940
- --------------------------------------------------------------------------------
Accrued administrative service fees 1,420
- --------------------------------------------------------------------------------
Accrued audit fees 8,101
- --------------------------------------------------------------------------------
Accrued transfer agent fees 28,848
- --------------------------------------------------------------------------------
Other accrued expenses 21,520
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Liabilities 3,647,569
- --------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING (PAR VALUE $0.01,
UNLIMITED SHARES AUTHORIZED) $179,291,040
- --------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Investor shares (based on net assets of $96,096,191 and
4,441,431 shares outstanding) $ 21.64
- --------------------------------------------------------------------------------
Institutional shares (based on net assets of $83,194,849 and
3,840,995 shares outstanding) $ 21.66
- --------------------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Dividends $ 1,050,089
- --------------------------------------------------------------------------------
Interest 429,901
- --------------------------------------------------------------------------------
Total Income 1,479,990
- --------------------------------------------------------------------------------
EXPENSES:
Investment advisory fees 618,818
- --------------------------------------------------------------------------------
12b-1 fees - Investor Shares 90,933
- --------------------------------------------------------------------------------
Administrative service fees 6,876
- --------------------------------------------------------------------------------
Accounting fees 12,515
- --------------------------------------------------------------------------------
Audit fees 23,201
- --------------------------------------------------------------------------------
Transfer agent fees - Investor Shares 61,544
- --------------------------------------------------------------------------------
Transfer agent fees - Institutional Shares 15,862
- --------------------------------------------------------------------------------
Custodian fees 10,930
- --------------------------------------------------------------------------------
Reports to shareholders 51,276
- --------------------------------------------------------------------------------
Registration fees - Investor Shares 42,821
- --------------------------------------------------------------------------------
Registration fees - Institutional Shares 25,381
- --------------------------------------------------------------------------------
Legal fees 17,571
- --------------------------------------------------------------------------------
Directors'/Trustees' fees and expenses 5,808
- --------------------------------------------------------------------------------
Other expenses 5,397
- --------------------------------------------------------------------------------
Total Expenses 988,933
- --------------------------------------------------------------------------------
Less earnings credits (7,447)
- --------------------------------------------------------------------------------
Expenses - Net 981,486
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net Investment Income (Loss) 498,504
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized gains (losses) from securities and foreign
currency transactions 9,640,171
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) from
securities and foreign currency transactions 4,640,777
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments and
Foreign Currency Transactions 14,280,948
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 14,779,452
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
27
<PAGE>
BERGER SMALL CAP VALUE FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998 Period from
(Unaudited) 1/1/97 to 9/30/97
- ---------------------------------------------------------------------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income $ 498,504 $ 285,658
- ---------------------------------------------------------------------------------
Net realized gains (losses) from securities
and foreign currency transactions 9,640,171 13,448,833
- ---------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) from securities and
foreign currency transactions 4,640,777 7,588,958
- ---------------------------------------------------------------------------------
Net increase in net assets resulting from
operations 14,779,452 21,323,449
- ---------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income - Investor Shares (589,238) --
- ---------------------------------------------------------------------------------
Net investment income - Institutional
Shares (706,938) --
- ---------------------------------------------------------------------------------
Net realized gains on investments -
Investor Shares (7,188,217) --
- ---------------------------------------------------------------------------------
Net realized gains on investments -
Institutional Shares (6,438,164) --
- ---------------------------------------------------------------------------------
Net Decrease in Net Assets from Dividends
and Distributions to Shareholders (14,922,557) --
- ---------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 94,332,616 73,022,239
- ---------------------------------------------------------------------------------
Issued in reinvestment of dividends 12,934,335 --
- ---------------------------------------------------------------------------------
Payment for shares redeemed (41,493,569) (16,725,574)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Derived from Fund Share Transactions 65,773,382 56,296,665
- ---------------------------------------------------------------------------------
Increase (Decrease) in Net Assets 65,630,277 77,620,114
- ---------------------------------------------------------------------------------
NET ASSETS
Beginning of period 113,660,763 36,040,649
- ---------------------------------------------------------------------------------
End of Period $ 179,291,040 $ 113,660,763
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
Capital (par value and paid in surplus) $ 149,970,127 $ 84,196,745
- ---------------------------------------------------------------------------------
Undistributed net investment income (loss) (535,809) 261,863
- ---------------------------------------------------------------------------------
Undistributed net realized gain (loss) from
investments 9,551,396 13,537,606
- ---------------------------------------------------------------------------------
Net unrealized appreciation (depreciation)
from investments and foreign currency
transactions 20,305,326 15,664,549
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Net Assets $ 179,291,040 $ 113,660,763
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<CAPTION>
Period from January 1,
Six Months Ended March 1997* to September 30,
31, 1998 (Unaudited) 1997
- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Institutional Shares
Shares Sold 1,418,006 $ 29,341,722 978,188 $ 19,358,765
- ---------------------------------------------------------------------------------
Shares issued to shareholders
in reinvestment of
distributions 283,736 5,661,885 -- --
- ---------------------------------------------------------------------------------
Shares repurchased (478,625) (10,018,509) (546,394) (10,307,663)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in
Shares 1,223,117 24,985,098 431,794 9,051,102
- ---------------------------------------------------------------------------------
Shares outstanding, beginning
of period 2,617,878 36,924,110 2,186,084 27,873,008
- ---------------------------------------------------------------------------------
Shares outstanding, end of
period 3,840,995 $ 61,909,208 2,617,878 $ 36,924,110
- ---------------------------------------------------------------------------------
Investor Shares
Shares sold 3,146,672 $ 64,990,894 2,806,894 $ 53,663,252
- ---------------------------------------------------------------------------------
Shares issued to shareholders
in reinvestment of
distributions 365,158 7,272,450 -- --
- ---------------------------------------------------------------------------------
Shares repurchased (1,548,659) (31,475,060) (328,634) (6,417,911)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in
Shares 1,963,171 40,788,284 2,478,260 47,245,341
- ---------------------------------------------------------------------------------
Shares outstanding, beginning
of period 2,478,260 47,245,341 -- --
- ---------------------------------------------------------------------------------
Shares outstanding, end of
period 4,441,431 $ 88,033,625 2,478,260 $ 47,245,341
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
</TABLE>
* For the period from January 1, 1997 through September 30, 1997 for the
Institutional Shares and for the period from February 14, 1997 (commencement of
Investor Shares) through September 30, 1997 for the Investor Shares.
See notes to financial statements.
28
<PAGE>
BERGER
MID CAP
GROWTH FUND
PORTFOLIO MANAGER'S COMMENTARY AMY K. SELNER
[BERGER MID CAP GROWTH FUND PHOTO]
PERFORMANCE
The Berger Mid Cap Growth Fund, which commenced operations on December 31, 1997,
had an impressive gain of 26%(1) in its first quarter. This compares with a gain
of 11.01% for the Standard & Poor's (S&P) 400 index,(2) an indicator of mid cap
stock performance in the overall market.
PERIOD IN REVIEW
Fund performance benefited particularly in the first quarter from our
overweighting in the technology (31.3%) and healthcare (16.7%) sectors. Our
Fund's core holdings in information technology service stocks, including Keane
and Sapient, had solid earnings and high recurring revenue. After a strong run
early in the quarter, prices of our semiconductor equipment stocks, including
KLA-Tencor and ETEC Systems, peaked in late February, and we scaled back our
holdings. We will consider increasing investment in semiconductor equipment
stocks on news of order improvements. Other technology outperformers for our
Fund included Comverse Technology and Linear Technology.
In the healthcare sector, pharmaceuticals continue to benefit from a rising pace
of innovation, shorter development times and faster regulatory reviews. Two Fund
holdings in this sector, Forest Laboratories and Mylan Laboratories, remain on
the growth curve.
Among consumer stocks held by our Fund, the consolidating sectors of outdoor
advertising and radio broadcasting contributed positively to performance.
Interestingly, local and national radio and outdoor advertising is
strengthening, while national television network advertising is softening. Radio
is clearly gaining advertising revenue share. Our Fund has two core holdings
among radio stocks -- Cox Radio and Jacor Communications. Among outdoor
advertisers, Universal Outdoor and Outdoor Systems are enjoying strong pricing
trends. As the tobacco-advertising ban begins to take hold, new advertisers are
flocking to the high-profile billboards previously committed to tobacco
companies, and they are paying a premium for them.
Our Fund was underweighted in the poor-performing energy sector for most of the
quarter, but we began to selectively add to this sector in mid-March. We expect
to increase exposure in this sector as oil prices stabilize and supply/demand
fundamentals improve. The market was disappointed by the magnitude of production
cuts announced by OPEC during the quarter, and it has taken a "show-me" stance
regarding the implementation of these cuts and their impact on supply.
LOOKING AHEAD
The market's first-quarter strength was fostered by robust economic trends that
we believe can continue. There is significant strength in retail spending,
housing and construction. Employment growth has been at near-record levels.
Personal income is rising, and consumer confidence is at an all-time high. Low
inflation and falling commodity prices have kept a lid on interest rates.
Because of Asia, the Federal Reserve is more likely to ease or keep rates flat
in the second quarter. We expect more visibility regarding the Asian crisis and
its effect on Japan and end demand in that region in the second quarter.
We're cautiously optimistic about prospects for mid cap stocks going forward.
The S&P 400 index has been improving in relative value to the S&P 500 and is
currently trading at a discount that is at the lower end of the historical
range. This suggests better relative valuation for mid cap stocks compared with
the larger cap stocks that dominate the S&P 500.
Thank you for your investment in the Berger Mid Cap Growth Fund.
1. Performance figures are based on historical results and are not intended to
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.
2. The S&P 400 is an unmanaged index, with dividends reinvested, which consists
of the common stocks of 400 publicly traded U.S. companies. It is a generally
recognized indicator used to measure mid cap stock performance in the U.S. stock
market. One cannot invest directly in an index.
29
<PAGE>
BERGER MID CAP GROWTH FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF
BERGER MID CAP GROWTH FUND VS.
S&P 400 MID CAP INDEX AND
COST OF LIVING INDEX
BERGER S&P 400 COST OF
MID CAP MIDCAP LIVING
GROWTH FUND INDEX INDEX
<S> <C> <C> <C>
12/31/97 $10,000 $10,000 $10,000
1/31/98 $10,340 $9,800 $10,019
2/28/98 $12,060 $10,601 $10,037
3/31/98 $12,600 $11,099 $10,037
BERGER MID CAP GROWTH FUND*
TOTAL RETURN
As of March 31, 1998
Life of Fund 26.00%
(12/31/97)
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares.
</TABLE>
30
<PAGE>
BERGER MID CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (95.50%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
BANKS - NORTHEAST (2.04%)
1,800 Peoples Bank Bridgeport Connecticut $ 68,343
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - ADVERTISING (6.69%)
2,250 Lamar Advertising Company* 78,750
- --------------------------------------------------------------------------------
2,200 Outdoor Systems, Inc.* 77,137
- --------------------------------------------------------------------------------
1,050 Universal Outdoor Holdings, Inc.* 67,725
- --------------------------------------------------------------------------------
223,612
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - SCHOOLS (2.02%)
1,400 Apollo Group, Inc.* 67,375
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES - SECURITY/SAFETY (1.64%)
1,610 Corrections Corporation of America* 54,941
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - ENTERPRISE (4.79%)
1,450 Keane, Inc.* 81,925
- --------------------------------------------------------------------------------
1,650 Sapient Corporation* 78,168
- --------------------------------------------------------------------------------
160,093
- --------------------------------------------------------------------------------
COMPUTER - INTEGRATED SYSTEMS (1.49%)
1,250 Wind River Systems, Inc.* 49,687
- --------------------------------------------------------------------------------
COSMETICS/PERSONAL CARE (1.68%)
1,650 Rexall Sundown, Inc.* 56,203
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR EQUIPMENT (5.16%)
600 Etec Systems, Inc.* 35,400
- --------------------------------------------------------------------------------
1,300 KLA Tenor Corporation* 49,725
- --------------------------------------------------------------------------------
1,800 Kulicke & Soffa Industries, Inc.* 39,150
- --------------------------------------------------------------------------------
1,200 Teradyne, Inc.* 48,075
- --------------------------------------------------------------------------------
172,350
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR MANUFACTURING (7.44%)
1,950 Credence Systems Corporation* 56,428
- --------------------------------------------------------------------------------
1,070 Linear Technology Corporation 73,830
- --------------------------------------------------------------------------------
2,020 Maxim Integrated Products, Inc.* 73,603
- --------------------------------------------------------------------------------
1,200 Xilinx, Inc.* 44,925
- --------------------------------------------------------------------------------
248,786
- --------------------------------------------------------------------------------
FINANCE - EQUITY REIT (1.12%)
900 CCA Prison Realty Trust 37,293
- --------------------------------------------------------------------------------
FINANCE - SAVINGS & LOAN (5.12%)
2,400 Ocwen Financial Corporation* 66,600
- --------------------------------------------------------------------------------
3,840 Sovereign Bancorp, Inc. 69,840
- --------------------------------------------------------------------------------
500 Webster Preferred Capital Corporation 34,750
- --------------------------------------------------------------------------------
171,190
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (95.50%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
FINANCE - CONSUMER/COMMERCIAL LOANS (4.11%)
1,850 Safeguard Scientifics, Inc.* $ 69,606
- --------------------------------------------------------------------------------
2,250 Sirrom Capital Corporation 67,640
- --------------------------------------------------------------------------------
137,246
- --------------------------------------------------------------------------------
FINANCIAL SERVICES - MISCELLANEOUS (1.94%)
1,300 Newcourt Credit Group, Inc. 65,000
- --------------------------------------------------------------------------------
HOUSEHOLD/OFFICE FURNITURE (1.42%)
1,300 Steelcase, Inc. 47,450
- --------------------------------------------------------------------------------
INSURANCE - PROPERTY/CASUALTY/TITLE (1.09%)
2,700 American Safety Insurance Group* 36,450
- --------------------------------------------------------------------------------
MEDIA - RADIO/TV (8.12%)
1,600 Cox Radio, Inc.* 77,600
- --------------------------------------------------------------------------------
1,400 Heftel Broadcasting Corporation* 62,650
- --------------------------------------------------------------------------------
1,150 Jacor Communications, Inc.* 67,850
- --------------------------------------------------------------------------------
1,700 Univision Communications, Inc.* 63,325
- --------------------------------------------------------------------------------
271,425
- --------------------------------------------------------------------------------
MEDICAL - ETHICAL DRUGS (7.74%)
1,600 Alza Corporation* 71,700
- --------------------------------------------------------------------------------
1,700 Dura Pharmaceuticals, Inc.* 41,862
- --------------------------------------------------------------------------------
1,950 Forest Laboratories, Inc.* 73,125
- --------------------------------------------------------------------------------
1,990 Jones Medical Industries, Inc. 72,013
- --------------------------------------------------------------------------------
258,700
- --------------------------------------------------------------------------------
MEDICAL - GENERIC DRUGS (3.37%)
3,100 Mylan Laboratories 71,300
- --------------------------------------------------------------------------------
1,150 Watson Pharmaceuticals, Inc.* 41,400
- --------------------------------------------------------------------------------
112,700
- --------------------------------------------------------------------------------
MEDICAL - HOSPITALS (2.07%)
1,200 Universal Health Services, Inc.* 69,300
- --------------------------------------------------------------------------------
MEDICAL - WHOLESALE DRUG/SUNDRIES (2.04%)
1,180 McKesson Corporation 68,145
- --------------------------------------------------------------------------------
MEDICAL/DENTAL - SUPPLIES (1.31%)
810 Steris Corporation* 43,740
- --------------------------------------------------------------------------------
OIL & GAS - DRILLING (0.37%)
400 Noble Drilling Corporation* 12,225
- --------------------------------------------------------------------------------
OIL & GAS - FIELD SERVICES (1.64%)
1,500 BJ Services Co.* 54,656
- --------------------------------------------------------------------------------
OIL & GAS - MACHINERY & EQUIPMENT (2.53%)
600 Camco International, Inc. 36,300
- --------------------------------------------------------------------------------
800 Cooper Cameron Corporation* 48,300
- --------------------------------------------------------------------------------
84,600
- --------------------------------------------------------------------------------
</TABLE>
31
<PAGE>
BERGER MID CAP GROWTH FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (95.50%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
OIL & GAS - US EXPLORATION & PRODUCTION (1.65%)
2,340 Ocean Energy, Inc.* $ 55,136
- --------------------------------------------------------------------------------
POLLUTION CONTROL - EQUIPMENT (1.47%)
1,400 United States Filter Corporation* 49,175
- --------------------------------------------------------------------------------
POLLUTION CONTROL - SERVICES (1.64%)
2,200 Allied Waste Industries, Inc.* 54,931
- --------------------------------------------------------------------------------
RETAIL - MISCELLANEOUS/DIVERSIFIED (1.66%)
2,050 Pier 1 Imports, Inc. 55,606
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - EQUIPMENT (3.42%)
2,000 Advanced Fibre Communications 72,750
- --------------------------------------------------------------------------------
850 Comverse Technology, Inc.* 41,543
- --------------------------------------------------------------------------------
114,293
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - SERVICES (8.73%)
1,400 Global Telesystems Group, Inc.* 65,450
- --------------------------------------------------------------------------------
1,500 ICG Communications, Inc.* 55,875
- --------------------------------------------------------------------------------
700 Intermedia Communications, Inc.* 55,737
- --------------------------------------------------------------------------------
1,500 Mcleod Inc.* 63,375
- --------------------------------------------------------------------------------
1,200 Winstar Communications, Inc.* 51,308
- --------------------------------------------------------------------------------
291,745
- --------------------------------------------------------------------------------
Total Common Stock
(Cost $2,941,535) 3,192,396
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
US GOVERNMENT AGENCY OBLIGATIONS (7.48%)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
250,000 Federal Home Loan Mortgage Corporation Discount
Note - 5.60% 4/2/98 $ 249,961
- --------------------------------------------------------------------------------
Total US Government Agency Obligations
(Cost $249,961) 249,961
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
REPURCHASE AGREEMENT (1.20%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
$ 40,000 Repurchase agreement with State Street Bank,
5.70% dated March 31, 1998, to be repurchased at
$40,006 on April 1, 1998, collateralized by U.S.
Treasury Bond, 6.60% - January 1, 2026, with a
value of $44,100
(Cost $40,000) 40,000
- --------------------------------------------------------------------------------
Total Repurchase Agreement
(Cost $40,000) 40,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments (Cost $3,231,496) (104.18%) 3,482,357
- --------------------------------------------------------------------------------
Total liabilities, less other assets (-4.18%) (139,580)
- --------------------------------------------------------------------------------
Net Assets (100.00%) $ 3,342,777
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Non-income producing security.
See notes to financial statements.
32
<PAGE>
BERGER MID CAP GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at cost $3,231,496
- --------------------------------------------------------------------------------
Investments, at value $3,482,357
- --------------------------------------------------------------------------------
Cash 72
- --------------------------------------------------------------------------------
Receivables
Investment securities sold 151,474
- --------------------------------------------------------------------------------
Fund shares sold 52,006
- --------------------------------------------------------------------------------
Dividends 647
- --------------------------------------------------------------------------------
Interest 6
- --------------------------------------------------------------------------------
Other Assets 3,657
- --------------------------------------------------------------------------------
Total Assets 3,690,219
- --------------------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 334,472
- --------------------------------------------------------------------------------
Fund shares redeemed 2,483
- --------------------------------------------------------------------------------
Accrued investment advisory fees 1,879
- --------------------------------------------------------------------------------
Accrued custodian fees 3,394
- --------------------------------------------------------------------------------
Accrued transfer agent fees 431
- --------------------------------------------------------------------------------
Accrued 12b-1 fees 626
- --------------------------------------------------------------------------------
Accrued audit fees 3,514
- --------------------------------------------------------------------------------
Accrued administrative service fees 25
- --------------------------------------------------------------------------------
Accrued shareholder reports 34
- --------------------------------------------------------------------------------
Other accrued expenses 584
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Liabilities 347,442
- --------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $3,342,777
- --------------------------------------------------------------------------------
Capital Shares
Authorized (par value $0.01) Unlimited
- --------------------------------------------------------------------------------
Shares outstanding 265,327
- --------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE $ 12.60
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Period from
12/31/97* to
3/31/98
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Income
Dividends $ 1,173
- --------------------------------------------------------------------------------
Interest 7,025
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Income 8,198
- --------------------------------------------------------------------------------
EXPENSES
Investment advisory fees 3,591
- --------------------------------------------------------------------------------
Administrative services fee 48
- --------------------------------------------------------------------------------
Accounting fees 2,250
- --------------------------------------------------------------------------------
Custodian fees 2,840
- --------------------------------------------------------------------------------
Transfer agent fees 706
- --------------------------------------------------------------------------------
Registration fees 1,638
- --------------------------------------------------------------------------------
12b-1 fees 1,197
- --------------------------------------------------------------------------------
Audit fees 3,514
- --------------------------------------------------------------------------------
Legal fees 4
- --------------------------------------------------------------------------------
Directors'/Trustees' fees and expenses 28
- --------------------------------------------------------------------------------
Reports to shareholders 154
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Expenses 15,970
- --------------------------------------------------------------------------------
Less fees waived by the advisor (6,338)
- --------------------------------------------------------------------------------
Less earnings credits (53)
- --------------------------------------------------------------------------------
Total Expenses, Net 9,579
- --------------------------------------------------------------------------------
Net Investment Income (loss) (1,381)
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on securities and foreign currency
transactions 197,447
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on securities
and foreign currency transactions 250,861
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments and Foreign
Currency Transactions 448,308
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $ 446,927
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
See notes to financial statements.
33
<PAGE>
BERGER MID CAP GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Period from 12/31/97* to
3/31/98
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
OPERATIONS:
Net investment income (loss) $ (1,381)
- --------------------------------------------------------------------------------
Net realized gain (loss) on securities and foreign
currency transactions 197,447
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation)
on securities and foreign currency transactions 250,861
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting from
Operations 446,927
- --------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income 0
- --------------------------------------------------------------------------------
Net realized gains on investments 0
- --------------------------------------------------------------------------------
Net Decrease in Net Assets from Dividends and
Distributions to Shareholders 0
- --------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 3,437,208
- --------------------------------------------------------------------------------
Net asset value of shares issued in reinvestment of
distributions 0
- --------------------------------------------------------------------------------
Payments for shares redeemed (541,358)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived from
Fund Share Transactions 2,895,850
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 3,342,777
- --------------------------------------------------------------------------------
NET ASSETS
Beginning of period 0
- --------------------------------------------------------------------------------
End of period $ 3,342,777
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $ 2,895,850
- --------------------------------------------------------------------------------
Undistributed net investment income (loss) (1,381)
- --------------------------------------------------------------------------------
Undistributed net realized gain (loss) from
investments 197,447
- --------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
securities and foreign currency transactions 250,861
- --------------------------------------------------------------------------------
Total $ 3,342,777
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<S> <C>
Shares sold 311,610
- --------------------------------------------------------------------------------
Shares issued to shareholders in reinvestment of
distributions 0
- --------------------------------------------------------------------------------
Shares repurchased (46,283)
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Shares 265,327
- --------------------------------------------------------------------------------
Shares outstanding, beginning of period 0
- --------------------------------------------------------------------------------
Shares outstanding, end of period 265,327
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
See notes to financial statements.
34
<PAGE>
BERGER
100
FUND
PORTFOLIO MANAGER'S COMMENTARY PATRICK S. ADAMS
[BERGER 100 FUND PHOTO]
PERFORMANCE
The first quarter of 1998 started the year off very strong. The Berger 100 Fund
(the "Fund") returned 17.99%(1) in the first quarter of 1998 versus only 13.94%
for the Standard & Poor's (S&P) 500(2) and 12.38% for the Lipper Growth
Index.(3) The first-quarter return positioned the fund as a leader in its peer
group. Although we lagged the S&P for the six-month period, (11.03% compared
with 17.21%), we are very pleased to report that we have made significant
progress toward achieving our goal of returning the Berger 100 Fund to
top-quartile performance in its peer group.
PERIOD IN REVIEW
Patrick Adams has been at the helm of our fund for a full year and has returned
42.31% for that period. Our philosophy is to focus primarily on high-quality
growth companies that are reasonably priced; as a result, we have significant
exposure in technology, consumer cyclicals and capital goods. Likewise, we took
profits in financials and healthcare.
We had major gains in several stocks in technology and consumer cyclicals
sectors since January 1. Our big winners in technology included Parametric
Technology, up 41%, and Cadence Design Systems, up 41%. Among consumer
cyclicals, one of our strongest performers was apparel manufacturer Tommy
Hilfiger, which gained a stunning 71%. We like the prospects for other apparel
companies such as Hilfiger and also own Liz Claiborne and Jones Apparel Group,
both of which delivered excellent returns during the first quarter.
Although we are underweighted in the financial sector, we had excellent
performance from some of our holdings, including Chase Manhattan Corp., which
gained more than 20%, and The Money Store, up more than 50%.
LOOKING AHEAD
We believe that, as 1998 continues to unfold, the U.S. economy will prove to be
very strong. We see no signs of recession ahead. Inflation and interest rates
are low. Job growth is high. We find little evidence of excess inventory
buildup. We also believe that the potential negative impact on U.S. stocks from
Asian events has been widely discounted in the market. However, we will keep a
close eye on Asia, watching for any signs of deterioration.
Given this scenario, we believe the economy can continue to expand for at least
the next couple of years. There is always the concern, however, that the economy
will expand at too fast a clip, which would lead the Federal Reserve Board to
raise interest rates -- something the market abhors. The Fed's stance so far in
1998 has been very accommodating; however, and it seems likely to maintain that
stance as long as the economy does not become overheated.
Going foward, we will continue to manage the Berger 100 Fund in keeping with our
long-standing philosophy that earnings growth is the primary factor that
determines a stock's performance over the long term. Accordingly, we will
primarily focus on high-quality companies with a history of steady earnings
growth and attractive valuations.
Thank you for your investment in the Berger 100 Fund.
1. Performance figures are based on historical results and are not intended to
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.
2. The S&P 500 is an unmanaged index, with dividends reinvested, which consists
of the common stocks of 500 publicly traded U.S. companies. It is a generally
recognized indicator used to measure overall performance of the U.S. stock
market. One cannot invest directly in an index.
3. The Lipper Growth Fund Index is an equally weighted performance index,
adjusted for capital gains distribution and income dividends, of the largest
qualifying funds in the Lipper category. Source: Lipper Analytical Services,
Inc.
35
<PAGE>
BERGER 100 FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF BERGER 100 FUND
VS.
S&P 500 INDEX AND COST OF LIVING INDEX
COST OF
BERGER S&P 500 LIVING
100 FUND INDEX INDEX
<S> <C> <C> <C> <C>
3/31/88 $10,000 $10,000 $10,000
3/31/89 $11,189 $11,809 $10,498
3/31/90 $14,563 $14,080 $11,047
3/31/91 $18,592 $16,108 $11,588
3/31/92 $25,991 $17,883 $11,957
3/31/93 $29,111 $20,603 $12,326
3/31/94 $33,656 $20,906 $12,635
3/31/95 $33,384 $24,156 $12,996
3/31/96 $42,405 $31,904 $13,365
3/31/97 $42,700 $38,229 $13,734
3/31/98 $60,766 $56,568 $13,923
BERGER 100 FUND*
AVERAGE ANNUAL TOTAL RETURN 1 Year 5 Year 10 Year
As of March 31, 1998 42.31% 15.86% 19.77%
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares.
</TABLE>
36
<PAGE>
BERGER 100 FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (87.01%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
AEROSPACE/DEFENSE (1.91%)
700,000 The Boeing Company $ 36,487,500
- --------------------------------------------------------------------------------
AUTO/TRUCK - ORIGINAL EQUIPMENT (0.93%)
315,000 Lear Corporation* 17,758,125
- --------------------------------------------------------------------------------
BANKS - MONEY CENTER (1.80%)
255,000 Chase Manhattan Corporation 34,393,125
- --------------------------------------------------------------------------------
BEVERAGES - SOFT DRINKS (0.93%)
414,000 Pepsico, Inc. 17,672,625
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - ENTERPRISE (4.76%)
2,725,900 Parametric Technology Corporation* 90,806,543
- --------------------------------------------------------------------------------
838 Structural Dynamics Research Corporation* 20,845
- --------------------------------------------------------------------------------
90,827,388
- --------------------------------------------------------------------------------
COMPUTER - GRAPHICS (2.86%)
1,574,900 Cadence Design Systems, Inc.* 54,530,912
- --------------------------------------------------------------------------------
COMPUTER - LOCAL NETWORKS (1.63%)
820,000 Ascend Communications, Inc.* 31,057,500
- --------------------------------------------------------------------------------
COMPUTER - MAINFRAMES (1.63%)
300,000 International Business Machines Corporation 31,162,500
- --------------------------------------------------------------------------------
COMPUTER - MINI/MICRO (2.76%)
337,800 Hewlett-Packard Company 21,408,075
- --------------------------------------------------------------------------------
749,200 Sun Microsystems, Inc.* 31,255,687
- --------------------------------------------------------------------------------
52,663,762
- --------------------------------------------------------------------------------
DIVERSIFIED OPERATIONS (1.36%)
475,000 Tyco Laboratories, Inc.* 25,946,875
- --------------------------------------------------------------------------------
ELECTRICAL - EQUIPMENT (3.98%)
920,000 Honeywell, Inc. 76,072,500
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR EQUIPMENT (2.39%)
403,100 Applied Materials, Inc.* 14,234,468
- --------------------------------------------------------------------------------
1,117,700 Lam Research Corporation* 31,435,312
- --------------------------------------------------------------------------------
45,669,780
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR MANUFACTURING (7.37%)
233,300 Altera Corporation* 8,807,075
- --------------------------------------------------------------------------------
154,100 Linear Technology Corporation 10,632,900
- --------------------------------------------------------------------------------
593,800 Maxim Integrated Products, Inc.* 21,636,587
- --------------------------------------------------------------------------------
400,000 Micron Technology, Inc.* 11,625,000
- --------------------------------------------------------------------------------
1,763,000 National Semiconductor Corporation* 36,912,812
- --------------------------------------------------------------------------------
1,363,600 Xilinx, Inc.* 51,049,775
- --------------------------------------------------------------------------------
140,664,149
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (87.01%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
FINANCE - MORTGAGE & RELATED SERVICES (1.16%)
780,800 Green Tree Financial Corporation $ 22,204,000
- --------------------------------------------------------------------------------
FOOD - FLOUR & GRAIN (1.69%)
1,000,900 Interstate Bakeries Corporation 32,341,581
- --------------------------------------------------------------------------------
HOUSEHOLD - HOUSEWARES (3.07%)
1,330,200 Sunbeam Corporation 58,611,937
- --------------------------------------------------------------------------------
LEISURE - GAMING (1.56%)
500,000 GTECH Holdings Corporation* 19,437,500
- --------------------------------------------------------------------------------
422,700 Mirage Resorts, Inc.* 10,276,893
- --------------------------------------------------------------------------------
29,714,393
- --------------------------------------------------------------------------------
LEISURE - HOTELS & MOTELS (3.11%)
1,091,300 Hilton Hotels Corporation 34,785,187
- --------------------------------------------------------------------------------
515,572 Promus Hotel Corporation* 24,618,563
- --------------------------------------------------------------------------------
59,403,750
- --------------------------------------------------------------------------------
MACHINE - TOOLS & RELATED PRODUCTS (0.81%)
295,000 Kennametal, Inc. 15,524,375
- --------------------------------------------------------------------------------
MEDICAL - DRUG/DIVERSIFIED (1.90%)
200,000 American Home Products Corporation 19,075,000
- --------------------------------------------------------------------------------
235,000 Johnson & Johnson 17,228,437
- --------------------------------------------------------------------------------
36,303,437
- --------------------------------------------------------------------------------
MEDICAL - OUTPATIENT/HOME CARE (1.03%)
700,000 HEALTHSOUTH Corporation* 19,643,750
- --------------------------------------------------------------------------------
OIL & GAS - DRILLING (2.53%)
400,000 Diamond Offshore Drilling, Inc. 18,150,000
- --------------------------------------------------------------------------------
587,500 Transocean Offshore, Inc. 30,219,531
- --------------------------------------------------------------------------------
48,369,531
- --------------------------------------------------------------------------------
OIL & GAS - FIELD SERVICES (1.24%)
470,000 Halliburton Company 23,588,125
- --------------------------------------------------------------------------------
OIL & GAS - MACHINERY/EQUIPMENT (0.93%)
440,000 Baker Hughes, Inc. 17,710,000
- --------------------------------------------------------------------------------
PAPER & PAPER PRODUCTS (2.52%)
660,000 Fort James Corporation 30,236,250
- --------------------------------------------------------------------------------
357,700 Kimberly-Clark Corporation 17,929,712
- --------------------------------------------------------------------------------
48,165,962
- --------------------------------------------------------------------------------
POLLUTION CONTROL - EQUIPMENT (2.81%)
1,528,800 United States Filter Corporation* 53,699,100
- --------------------------------------------------------------------------------
</TABLE>
37
<PAGE>
BERGER 100 FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (87.01%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
POLLUTION CONTROL - SERVICES (6.37%)
1,838,100 Republic Industries, Inc.* $ 47,445,956
- --------------------------------------------------------------------------------
1,665,700 USA Waste Services, Inc.* 74,227,756
- --------------------------------------------------------------------------------
121,673,712
- --------------------------------------------------------------------------------
RETAIL - APPAREL/SHOE (1.95%)
516,200 Ross Stores, Inc. 22,777,325
- --------------------------------------------------------------------------------
320,000 TJX Companies, Inc. 14,480,000
- --------------------------------------------------------------------------------
37,257,325
- --------------------------------------------------------------------------------
RETAIL - DEPARTMENT STORES (1.80%)
400,000 Consolidated Stores Corporation* 17,175,000
- --------------------------------------------------------------------------------
330,000 Federated Department Stores, Inc.* 17,098,125
- --------------------------------------------------------------------------------
34,273,125
- --------------------------------------------------------------------------------
RETAIL - RESTAURANTS (0.66%)
210,000 McDonalds Corporation 12,600,000
- --------------------------------------------------------------------------------
RETAIL - WHOLESALE COMPUTERS/CELLULAR (1.45%)
1,478,650 CHS Electronics, Inc.* 27,724,687
- --------------------------------------------------------------------------------
RETAIL/WHOLESALE - AUTO PARTS (1.24%)
700,000 Autozone, Inc.* 23,712,500
- --------------------------------------------------------------------------------
RETAIL/WHOLESALE - BUILDING PRODUCTS (0.86%)
232,700 Lowes Cos., Inc. 16,332,631
- --------------------------------------------------------------------------------
RETAIL/WHOLESALE - OFFICE SUPPLIES (2.60%)
820,000 Office Depot, Inc.* 25,522,500
- --------------------------------------------------------------------------------
1,345,000 Officemax, Inc.* 24,041,875
- --------------------------------------------------------------------------------
49,564,375
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - SERVICES (0.78%)
345,000 Worldcom, Inc.* 14,856,562
- --------------------------------------------------------------------------------
TEXTILE - APPAREL MANUFACTURING (7.49%)
400,000 Jones Apparel Group, Inc.* 22,025,000
- --------------------------------------------------------------------------------
1,237,400 Liz Claiborne, Inc. 61,715,325
- --------------------------------------------------------------------------------
985,500 Tommy Hilfiger Corporation* 59,191,593
- --------------------------------------------------------------------------------
142,931,918
- --------------------------------------------------------------------------------
TOBACCO (3.15%)
1,445,000 Philip Morris Companies, Inc. 60,238,450
- --------------------------------------------------------------------------------
Total Common Stock
(Cost $1,447,909,718) 1,661,351,967
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
INVESTMENT TRUST (4.90%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
FINANCE - PUBLIC INVESTMENT FUND (4.90%)
850,000 S&P 500 Depository Receipts $ 93,526,562
- --------------------------------------------------------------------------------
Total Investment Trust
(Cost $90,214,330) 93,526,562
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
US GOVERNMENT AGENCY OBLIGATIONS (4.17%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
20,000,000 Federal Home Loan Mortgage Corporation
Discount Note 5.41% 4/23/98 19,933,877
- --------------------------------------------------------------------------------
20,000,000 Federal Home Loan Mortgage Corporation
Discount Note 5.40% 5/4/98 19,901,000
- --------------------------------------------------------------------------------
20,000,000 Federal National Mortgage Association Discount
Note 5.42% 4/20/98 19,942,788
- --------------------------------------------------------------------------------
20,000,000 Federal National Mortgage Association Discount
Note 5.40% 5/5/98 19,898,000
- --------------------------------------------------------------------------------
Total US Government Agency Obligations
(Cost $79,675,665) 79,675,665
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
PREFERRED STOCK (1.28%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
RETAIL - MAIL ORDER & DIRECT (1.28%)
470,000 Cendant Corporation 24,498,750
- --------------------------------------------------------------------------------
Total Preferred Stock
(Cost $23,500,000) 24,498,750
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
REPURCHASE AGREEMENT (0.05%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
$ 981,000 Repurchase agreement with State Street Bank,
5.70% dated March 31, 1998, to be repurchased
at $981,155 on April 1, 1998, collateralized
by U.S. Treasury Bond, 6.50% - August 20,
2016, with a value of $1,004,500
(Cost $981,000) 981,000
- --------------------------------------------------------------------------------
Total Repurchase Agreement
(Cost $981,000) 981,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments (Cost $1,642,280,713) (97.42%) 1,860,033,944
- --------------------------------------------------------------------------------
Other assets, less liabilities (2.58%) 49,331,865
- --------------------------------------------------------------------------------
Net Assets (100.00%) $1,909,365,809
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Non-income producing security.
See notes to financial statements.
38
<PAGE>
BERGER 100 FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at cost $1,642,280,713
- --------------------------------------------------------------------------------
Investments, at value $1,860,033,944
- --------------------------------------------------------------------------------
Cash 624
- --------------------------------------------------------------------------------
Receivables
Investment securities sold 90,998,567
- --------------------------------------------------------------------------------
Fund shares sold 4,492,359
- --------------------------------------------------------------------------------
Dividends 882,048
- --------------------------------------------------------------------------------
Interest 155
- --------------------------------------------------------------------------------
Total Assets 1,956,407,697
- --------------------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 41,303,789
- --------------------------------------------------------------------------------
Fund shares redeemed 2,579,639
- --------------------------------------------------------------------------------
Accrued investment advisory fees 1,215,609
- --------------------------------------------------------------------------------
Accrued custodian fees 70,250
- --------------------------------------------------------------------------------
Accrued transfer agent fees 868,519
- --------------------------------------------------------------------------------
Accrued 12b-1 fees 405,203
- --------------------------------------------------------------------------------
Accrued audit fees 15,081
- --------------------------------------------------------------------------------
Accrued administrative service fees 16,208
- --------------------------------------------------------------------------------
Accrued shareholder reports 433,783
- --------------------------------------------------------------------------------
Other accrued expenses 133,807
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Liabilities 47,041,888
- --------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $1,909,365,809
- --------------------------------------------------------------------------------
Capital Shares
Authorized (Par Value $0.01) Unlimited
- --------------------------------------------------------------------------------
Shares Outstanding 120,328,718
- --------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE $ 15.87
- --------------------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Income
Dividends $ 4,929,297
- --------------------------------------------------------------------------------
Interest 4,399,651
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Income 9,328,948
- --------------------------------------------------------------------------------
EXPENSES
Investment advisory fees 6,686,617
- --------------------------------------------------------------------------------
Administrative services fee 89,155
- --------------------------------------------------------------------------------
Accounting fees 89,275
- --------------------------------------------------------------------------------
Custodian fees 81,950
- --------------------------------------------------------------------------------
Transfer agent fees 2,094,957
- --------------------------------------------------------------------------------
Registration fees 193,838
- --------------------------------------------------------------------------------
12b-1 fees 2,228,872
- --------------------------------------------------------------------------------
Audit fees 42,581
- --------------------------------------------------------------------------------
Legal fees 42,319
- --------------------------------------------------------------------------------
Directors'/Trustees' fees and expenses 77,747
- --------------------------------------------------------------------------------
Reports to shareholders 859,544
- --------------------------------------------------------------------------------
Other expenses 125,679
- --------------------------------------------------------------------------------
Total Expenses 12,612,534
- --------------------------------------------------------------------------------
Less fees paid indirectly (144,077)
- --------------------------------------------------------------------------------
Less earnings credits (75,556)
- --------------------------------------------------------------------------------
Total Expenses, Net 12,392,901
- --------------------------------------------------------------------------------
Net investment income (loss) (3,063,953)
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on securities and foreign currency
transactions 255,204,468
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on
securities and foreign currency transactions (65,048,198)
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments and
Foreign Currency Transactions 190,156,270
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 187,092,317
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
39
<PAGE>
BERGER 100 FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months
Ended 3/31/98 Year Ended
(Unaudited) 9/30/97
- --------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (3,063,953) $ (7,681,112)
- --------------------------------------------------------------------------------
Net realized gain (loss) on securities and
foreign currency transactions 255,204,468 626,966,523
- --------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions (65,048,198) (171,376,782)
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 187,092,317 447,908,629
- --------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net Investment Income 0 0
- --------------------------------------------------------------------------------
Net realized gains on investments (600,637,046) (270,495,436)
- --------------------------------------------------------------------------------
Net Decrease in Net Assets from Dividends and
Distributions to Shareholders (600,637,046) (270,495,436)
- --------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 208,522,533 221,412,748
- --------------------------------------------------------------------------------
Net asset value of shares issued in
reinvestment of distributions 585,185,751 263,475,315
- --------------------------------------------------------------------------------
Payments for shares redeemed (369,845,513) (775,959,151)
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived
from Fund Share Transactions 423,862,771 (291,071,088)
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 10,318,042 (113,657,895)
- --------------------------------------------------------------------------------
NET ASSETS
Beginning of period 1,899,047,767 2,012,705,662
- --------------------------------------------------------------------------------
End of period $ 1,909,365,809 $ 1,899,047,767
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid-in-surplus) $ 1,449,979,562 $ 1,026,116,791
- --------------------------------------------------------------------------------
Undistributed net investment income (loss) (3,157,676) (93,723)
- --------------------------------------------------------------------------------
Undistributed net realized gain (loss) from
investments 244,790,692 590,223,270
- --------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
securities and foreign currency transactions 217,753,231 282,801,429
- --------------------------------------------------------------------------------
Total $ 1,909,365,809 $ 1,899,047,767
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<S> <C> <C>
Shares sold 13,569,762 11,630,377
- --------------------------------------------------------------------------------
Shares issued to shareholders in reinvestment
of distributions 42,594,210 14,694,636
- --------------------------------------------------------------------------------
Shares repurchased (24,101,901) (40,551,993)
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Shares 32,062,071 (14,226,980)
- --------------------------------------------------------------------------------
Shares outstanding, beginning of period 88,266,647 102,493,627
- --------------------------------------------------------------------------------
Shares outstanding, end of period 120,328,718 88,266,647
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
40
<PAGE>
BERGER/BIAM
INTERNATIONAL
FUND
PORTFOLIO MANAGER'S COMMENTARY BANK OF IRELAND ASSET
MANAGEMENT (U.S.) LTD.
[PHOTO]
PERFORMANCE
For the six-month period ending March 31, 1998, the Berger/BIAM International
Fund (the "Fund") had a total return of 7.46%,1 compared with 5.87% for MSCI
EAFE Index.2
The primary positive contributors to performance during the period were Growth
in Telecommunications, Healthcare Needs and, to a lesser extent, Positive
Banking Environment.
Stocks in Growth in Telecommunications had the largest positive impact on
portfolio performance. Mannesmann had a stellar first quarter after announcing a
doubling in its cellular network subscribers in 1997. Cable and Wireless did
well following its affiliate's decision (Hong Kong Telecom) to relinquish its
Hong Kong monopoly. The deal removes uncertainty surrounding the stock that had
held the price back in 1997. Vodafone profited from a surge in new mobile phone
customers and positive reaction to news that a consortium, of which it is a
shareholder, was awarded a license to develop a mobile phone network in Egypt.
Stocks in Healthcare Needs also produced strong returns, led by Zeneca, which
had significant increases in profit and sales. After getting off to a fast
start, Glaxo Wellcome fell back on news that its proposed merger with SmithKline
Beecham was aborted.
Although our Positive Banking Environment theme suffered in the latter part of
1997, primarily because of the Asian crisis, there was a solid turnaround in the
first quarter 1998. European financial stocks were the linchpin of a strong
equity market performance. The run-up in financial stocks was driven by
prospects for continued economic recovery, low interest rates and investor
expectations of further consolidation in the overbanked European region. Among
portfolio holdings, Banco de Santander was a standout. This Spanish bank
performed in line with expectations in 1997, and its decision to acquire another
Spanish bank was greeted very positively by the market.
Pacific Basin themes continued to disappoint, although these now represent a
small portion of the portfolio. Share prices of Japanese stocks in Technological
Innovation also had a negative impact. We believe these stocks were dragged down
by negative sentiment about the Japanese economy overall. Prices may bounce back
when earnings results are released later this spring.
PERIOD IN REVIEW
Global equity markets had a rocky fourth quarter 1997 as Asian troubles
reverberated around the world. In European markets, share prices of companies
with earnings exposure to the Pacific Rim were hit hard. However, 1998 started
on a positive note. Falling interest rates, receding Asian crisis, positive Wall
Street background and surging liquidity combined to drive the markets higher.
Affirmation of the 11 likely starters for European Monetary Union next January
gave further impetus to peripheral European markets, with Spain and especially
Italy being the star performers. In the U.K., British fund managers rotated out
of industrial and cyclical stocks that underperformed during 1997 and into
financials and pharmaceuticals.
In Asia, Indonesia's currency went into free fall, declining 50% as concerns
mounted about increasing bad debts, rising unemployment and upcoming
presidential elections. The currency stabilized by March 31 when a more flexible
reform package was agreed to by the IMF. Japan was not immune to Asian problems,
and its market fell during the period. Japan is the biggest foreign investor,
producer and lender in Asia, so it was no surprise that the regional currency
debacle weighed heavily on Japan's already worrisome bad debt crisis.
LOOKING AHEAD
We are cautiously optimistic about international equity market prospects for the
remainder of 1998. The move toward EMU remains on track, and growth prospects
for core Europe are brighter than at the start of the year. In Germany, domestic
demand is slowly recovering, and, for the first time in more than a year,
unemployment is beginning to fall. Significant mergers and acquisitions are
likely in financials, pharmaceuticals and telecoms, which should support share
prices. Because of the high valuation levels in core Europe, we may take profits
in stocks that look stretched from a valuation perspective. We are seeking
opportunities among stocks that have underperformed for an extended period and
that have a catalyst for change visible on the horizon.
In Asia, attention is likely to remain on the Japanese government as investors
await intervention to stimulate the domestic economy. Unless and until there is
a meaningful move by the government, the Japanese stock market is unlikely to
recover. We believe that, on a company-by-company basis, value can still be
found in Japanese companies that are continuing to grow their earnings. We
remain extremely cautious on the rest of Asia. The region's economies can
recover, but only with the introduction of painful fiscal measures and massive
deregulation.
We thank you for your investment in the Berger/BIAM International Fund.
1. Performance figures are based on historical results and are not intended to
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.
2. The Morgan Stanley Capital International EAFE Index represents major overseas
stock markets. It is an unmanaged index. One cannot invest directly in an index.
41
<PAGE>
BERGER/BIAM INTERNATIONAL FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF BERGER/BIAM
INTERNATIONAL FUND VS.
EAFE INDEX AND COST OF LIVING INDEX
BERGER/BIAM COST OF
INTERNATIONAL EAFE LIVING
FUND INDEX INDEX
<S> <C> <C> <C> <C>
7/31/89 $10,000 $10,000 $10,000
3/31/90 $12,640 $8,388 $10,346
3/31/91 $12,550 $8,628 $10,852
3/31/92 $13,450 $7,963 $11,198
3/31/93 $15,320 $8,919 $11,543
3/31/94 $18,520 $10,956 $11,833
3/31/95 $18,620 $11,654 $12,170
3/31/96 $23,080 $13,130 $12,516
3/31/97 $25,739 $13,361 $12,862
3/31/98 $29,988 $15,889 $13,039
BERGER/BIAM INTERNATIONAL FUND* 1 Year 5 Year Life of Fund
AVERAGE ANNUAL TOTAL RETURN (7/31/89)
As of March 31, 1998 16.51% 14.38% 13.50%
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares. Performance
figures are historical and, in part, reflect the
performance of a pool of assets advised by
BIAM (Bank of Ireland Asset Management) for
periods before the Fund commenced opera-
tions on October 11, 1996, adjusted to reflect
any increased expenses associated with oper-
ating the Fund. The asset pool was not
registered with the Securities and Exchange
Commission and therefore was not subject to
the investment restrictions imposed by law on
registered mutual funds. If the pool had been
registered, its performance might have been
adversely affected.
</TABLE>
42
<PAGE>
BERGER/BIAM INTERNATIONAL FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
ASSETS
Investment in Berger/BIAM International Portfolio ("Portfolio"),
at value $19,982,901
- --------------------------------------------------------------------------------
Receivable for fund shares sold 38,340
- --------------------------------------------------------------------------------
Total Assets 20,021,241
- --------------------------------------------------------------------------------
LIABILITIES
Payables
Fund shares redeemed 10,774
- --------------------------------------------------------------------------------
Accrued administrative fee 7,639
- --------------------------------------------------------------------------------
Accrued registration fees 212
- --------------------------------------------------------------------------------
Accrued 12b-1 fees 4,244
- --------------------------------------------------------------------------------
Total Liabilities 22,869
- --------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $19,998,372
- --------------------------------------------------------------------------------
Capital Shares
Authorized (par value $.01) Unlimited
- --------------------------------------------------------------------------------
Shares outstanding 1,694,004
- --------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE $ 11.81
- --------------------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
NET INVESTMENT INCOME ALLOCATED FROM PORTFOLIO:
Interest and dividends (net of $4,239 foreign withholding
taxes) $ 139,838
- --------------------------------------------------------------------------------
Portfolio expenses (net of earnings credits and fee waivers
totaling $16,690) (85,705)
- --------------------------------------------------------------------------------
NET INVESTMENT INCOME ALLOCATED FROM PORTFOLIO 54,133
- --------------------------------------------------------------------------------
FUND EXPENSES:
Administrative fees 40,027
- --------------------------------------------------------------------------------
12b-1 fees 22,237
- --------------------------------------------------------------------------------
Registration fees 5,314
- --------------------------------------------------------------------------------
Legal fees 1,700
- --------------------------------------------------------------------------------
Total Fund Expenses 69,278
- --------------------------------------------------------------------------------
Net Investment Income (Loss) (15,145)
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS ALLOCATED FROM PORTFOLIO:
Net realized gain (loss) on investments and foreign currency
transactions (545,176)
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on
investments and foreign currency transactions 1,845,728
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments and
Foreign Currency Transactions Allocated from Portfolio 1,300,552
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 1,285,407
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
43
<PAGE>
BERGER/BIAM INTERNATIONAL FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months Ended Period From
March 31, 1998 November 7, 1996* to
(Unaudited) September 30, 1997
- -------------------------------------------------------------------------------------------
<S> <C> <C>
FROM OPERATIONS
Net investment income (loss) $ (15,145) $ 85,181
- -------------------------------------------------------------------------------------------
Net realized gain (loss) on investments and
foreign currency transactions (545,176) 379,860
- -------------------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on investments and foreign
currency transactions 1,845,728 1,488,886
- -------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 1,285,407 1,953,927
- -------------------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (98,586) --
- -------------------------------------------------------------------------------------------
Net realized gains on investments (591,904) --
- -------------------------------------------------------------------------------------------
Net Decrease in Net Assets from Dividends and
Distributions to Shareholders (690,490) --
- -------------------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 5,586,907 25,761,342
- -------------------------------------------------------------------------------------------
Net asset value of shares issued in reinvestment
of distributions 671,358 --
- -------------------------------------------------------------------------------------------
Payments for shares redeemed (5,528,095) (9,041,984)
- -------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived from
Fund Share Transactions 730,170 16,719,358
- -------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets 1,325,087 18,673,285
- -------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 18,673,285 --
- -------------------------------------------------------------------------------------------
End of Period $ 19,998,372 $ 18,673,285
- -------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
Capital (par value and paid in surplus) $ 17,449,528 $ 16,719,358
- -------------------------------------------------------------------------------------------
Undistributed net investment income (loss) (28,550) 85,181
- -------------------------------------------------------------------------------------------
Undistributed net realized gain (loss) on
investments and foreign currency transactions (757,220) 379,860
- -------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) on
investments and foreign currency transactions 3,334,614 1,488,886
- -------------------------------------------------------------------------------------------
Net Assets $ 19,998,372 $ 18,673,285
- -------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<S> <C> <C>
Shares sold 512,303 2,467,579
- -------------------------------------------------------------------------------------------
Shares issued to shareholders in reinvestment of
distributions 64,871 --
- -------------------------------------------------------------------------------------------
Shares repurchased (512,923) (837,826)
- -------------------------------------------------------------------------------------------
Net Increase (Decrease) in Shares 64,251 1,629,753
- -------------------------------------------------------------------------------------------
Shares outstanding, beginning of period 1,629,753 --
- -------------------------------------------------------------------------------------------
Shares Outstanding, End of Period 1,694,004 1,629,753
- -------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
See notes to financial statements.
44
<PAGE>
BERGER
GROWTH AND
INCOME FUND
CO-PORTFOLIO SHEILA J. OHLSSON
MANAGERS' COMMENTARY PATRICK S. ADAMS
[BERGER GROWTH AND INCOME FUND PHOTO]
PERFORMANCE
The Berger Growth & Income Fund (the "Fund") got off to a stronger start in the
first quarter of 1998, with a particularly positive end to the quarter. Our Fund
returned 10.86%(1) in the quarter, vs. 17.21% for the Standard & Poor's (S&P)
500.(2) The last quarter of 1997 was challenging, but we remain sanguine about
the balance of 1998.
PERIOD IN REVIEW
Oil services comprised about 14% of our Fund at the beginning of the half.
Because of concerns about both exploration and production spending budgets for
1998 and weaker commodity prices, the group corrected significantly. We scaled
back in these companies, and as of March 31 we had 6% of our Fund's assets in
oil service stocks. We continue to feel that the group offers compelling value
and that upon clarification of the above-mentioned issues, the stocks are likely
to be strong performers.
Technology was a difficult sector in the fourth calendar quarter of 1997. Our
Fund began the quarter with 23% of total assets invested in technology stocks.
The group corrected significantly because of the precarious situation in Asia,
which led to concerns about future earnings. Because of the conservative nature
of the Fund, we felt it prudent to reduce our technology exposure by about half.
Our Fund ended the fourth quarter with a 12% weighting in technology. The market
quickly discounted potential near-term earnings disappointments into the stocks
and began to focus on the longer term. This precipitated a sharp upward move in
technology stocks. Because of our Fund's underweighted position in technology,
we did not fully participate in the Nasdaq rally, and first-quarter performance
got off to a slower start relative to our benchmark. By early February, we had
increased our weighting in technology and ended the quarter with 25.9% of total
assets in technology stocks. We remain cautiously optimistic about the future.
A significant sector change made in the period was a reduction in our Fund's
exposure to Real Estate Investment Trusts (REITs), which comprised about 11% of
our Fund on September 30, 1997. We felt that the assets could be more
productively invested in other sectors. As of March 31, our Fund had 17.7% of
its assets invested in financial stocks, making the sector our second-largest.
We feel that a low interest rate environment combined with a strong economy will
continue to provide fertile ground for these types of stocks.
Following technology and financials, our third-largest sector weighting was
healthcare at 17.2% of total Fund assets. Healthcare stocks were strong
performers throughout the period. Roughly half our healthcare holdings are in
pharmaceutical companies, which have been benefiting from strong unit sales,
stable-to-up pricing and robust new product pipelines. The remainder of our
Fund's holdings in this sector are relatively diverse, with investments in
medical device, healthcare service and healthcare information systems companies.
Healthcare companies are typically defensive types of investments, and,
particularly given the Asian situation, we felt that this group provided good
balance in our Fund.
Some of our best-performing stocks during the period were cellular phone handset
manufacturer Nokia, healthcare information systems company HBO & Co. and
retailer Dayton Hudson. At the end of the quarter, our Fund had about 8% of its
assets in convertible bonds, which enable participation in equity appreciation
and also return dividend income to shareholders.
LOOKING AHEAD
We are in the midst of one of the strongest economic climates this nation has
ever experienced. Unemployment and inflation continue to run at the lowest
levels seen in years. If we do have one concern, it is the potential for
labor-cost inflation combined with price deflation. We are monitoring these
variables closely. For the foreseeable future, however, we continue to remain
cautiously optimistic about the market and the economy.
1. Performance figures are based on historical results and are not intended to
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.
2. The S&P 500 is an unmanaged index, with dividends reinvested, which consists
of the common stocks of 500 publicly traded U.S. companies. It is a generally
recognized indicator used to measure overall performance of the U.S. stock
market. One cannot invest directly in an index.
45
<PAGE>
BERGER GROWTH AND INCOME FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF
BERGER GROWTH & INCOME FUND VS.
S&P 500 INDEX AND COST OF LIVING INDEX
BERGER S&P COST OF
GROWTH & 500 LIVING
INCOME FUND INDEX INDEX
<S> <C> <C> <C>
3/31/88 $10,000 $10,000 $10,000
3/31/89 $10,499 $11,809 $10,498
3/31/90 $11,885 $14,080 $11,047
3/31/91 $13,346 $16,108 $11,588
3/31/92 $18,284 $17,883 $11,957
3/31/93 $20,032 $20,603 $12,326
3/31/94 $22,308 $20,906 $12,635
3/31/95 $22,014 $24,156 $12,996
3/31/96 $27,708 $31,904 $13,365
3/31/97 $31,027 $38,229 $13,734
3/31/98 $41,921 $56,568 $13,923
BERGER GROWTH & INCOME FUND*
AVERAGE ANNUAL TOTAL RETURNS
As of March 31, 1998
1 Year 5 Year 10 Year
35.11% 15.92% 15.41%
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares.
</TABLE>
46
<PAGE>
BERGER GROWTH & INCOME FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (84.47%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
AEROSPACE/DEFENSE (1.09%)
75,000 The Boeing Company $ 3,909,375
- --------------------------------------------------------------------------------
AUTO MANUFACTURERS - DOMESTIC (1.80%)
100,000 Ford Motor Co. 6,481,250
- --------------------------------------------------------------------------------
BANKS - SUPER REGIONAL (1.73%)
150,000 Norwest Corporation 6,234,375
- --------------------------------------------------------------------------------
CHEMICALS - BASIC (1.81%)
125,000 Monsanto Company 6,500,000
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - ENTERPRISE (4.82%)
110,000 Computer Associates International, Inc. 6,352,500
- --------------------------------------------------------------------------------
125,000 Compuware Corporation* 6,171,875
- --------------------------------------------------------------------------------
145,000 Parametric Technology Corporation* 4,830,312
- --------------------------------------------------------------------------------
17,354,687
- --------------------------------------------------------------------------------
COMPUTER - LOCAL NETWORKS (2.86%)
150,000 Ascend Communications, Inc.* 5,681,250
- --------------------------------------------------------------------------------
67,500 Cisco Systems, Inc.* 4,615,312
- --------------------------------------------------------------------------------
10,296,562
- --------------------------------------------------------------------------------
COMPUTER - MINI/MICRO (0.81%)
70,000 Sun Microsystems, Inc.* 2,920,312
- --------------------------------------------------------------------------------
COMPUTER - SERVICES (3.61%)
110,000 Cambridge Technology Partners, Inc.* 5,451,875
- --------------------------------------------------------------------------------
125,000 HBO & Company 7,546,875
- --------------------------------------------------------------------------------
12,998,750
- --------------------------------------------------------------------------------
ELECTRICAL - EQUIPMENT (1.15%)
50,000 Honeywell, Inc. 4,134,375
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR EQUIPMENT (2.55%)
45,000 ASM Lithography Holding NV* 4,159,687
- --------------------------------------------------------------------------------
125,000 Teradyne, Inc.* 5,007,812
- --------------------------------------------------------------------------------
9,167,499
- --------------------------------------------------------------------------------
ELECTRONIC - MEASURING INSTRUMENTS (0.62%)
100,000 Mettler Toledo International, Inc.* 2,218,750
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR MANUFACTURING (3.52%)
65,000 Linear Technology Corporation 4,485,000
- --------------------------------------------------------------------------------
125,000 Maxim Integrated Products, Inc.* 4,554,687
- --------------------------------------------------------------------------------
60,000 Motorola, Inc. 3,637,500
- --------------------------------------------------------------------------------
12,677,187
- --------------------------------------------------------------------------------
FINANCE - CONSUMER/COMMERCIAL LOANS (1.67%)
200,200 Sirrom Capital Corporation 6,018,512
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (84.47%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
FINANCE - MORTGAGE & RELATED SERVICES (1.45%)
110,000 Federal Home Loan Mortgage Corporation $ 5,218,125
- --------------------------------------------------------------------------------
FINANCE - MORTGAGE REIT (1.44%)
274,600 Capital Automotive REIT 5,183,075
- --------------------------------------------------------------------------------
FINANCE - SAVINGS & LOANS (1.16%)
150,000 Ocwen Financial Corporation 4,162,500
- --------------------------------------------------------------------------------
FINANCIAL SERVICES - MISCELLANEOUS (4.45%)
40,000 American Express Co. 3,672,500
- --------------------------------------------------------------------------------
175,000 First Data Corporation 5,687,500
- --------------------------------------------------------------------------------
50,000 Morgan Stanley Dean Witter Discover & Co. 3,643,750
- --------------------------------------------------------------------------------
60,000 Newcourt Credit Group, Inc. 3,000,000
- --------------------------------------------------------------------------------
16,003,750
- --------------------------------------------------------------------------------
HOUSEHOLD - HOUSEWARES (2.71%)
221,500 Sunbeam Corporation 9,759,843
- --------------------------------------------------------------------------------
INSURANCE - LIFE (1.18%)
75,000 Conseco, Inc. 4,246,875
- --------------------------------------------------------------------------------
INSURANCE - PROPERTY/CASUALTY/TITLE (2.76%)
75,000 Mercury General Corporation 4,692,187
- --------------------------------------------------------------------------------
80,000 MGIC Investment Corporation 5,255,000
- --------------------------------------------------------------------------------
9,947,187
- --------------------------------------------------------------------------------
MEDICAL - DRUG/DIVERSIFIED (1.59%)
60,000 American Home Products Corporation 5,722,500
- --------------------------------------------------------------------------------
MEDICAL - ETHICAL DRUGS (5.65%)
150,000 Alza Corporation* 6,721,875
- --------------------------------------------------------------------------------
75,000 Pfizer, Inc. 7,476,562
- --------------------------------------------------------------------------------
75,000 Schering-Plough Corporation 6,126,562
- --------------------------------------------------------------------------------
20,324,999
- --------------------------------------------------------------------------------
MEDICAL - HOSPITALS (1.57%)
175,000 Columbia HCA Healthcare Corporation 5,643,750
- --------------------------------------------------------------------------------
MEDICAL - OUTPATIENT/HOME CARE (1.56%)
200,000 HEALTHSOUTH Corporation* 5,612,500
- --------------------------------------------------------------------------------
MEDICAL - PRODUCTS (1.69%)
90,000 Boston Scientific Corporation* 6,075,000
- --------------------------------------------------------------------------------
MEDICAL - WHOLESALE DRUG/SUNDRIES (2.25%)
140,000 McKesson Corporation 8,085,000
- --------------------------------------------------------------------------------
MEDICAL/DENTAL - SUPPLIES (1.50%)
100,000 Steris Corporation* 5,400,000
- --------------------------------------------------------------------------------
</TABLE>
47
<PAGE>
BERGER GROWTH & INCOME FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (84.47%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
OIL & GAS - DRILLING (1.23%)
150,000 R & B Falcon Corporation* $ 4,443,750
- --------------------------------------------------------------------------------
OIL & GAS - FIELD SERVICES (2.77%)
149,400 BJ Services Co.* 5,443,762
- --------------------------------------------------------------------------------
90,000 Halliburton Co. 4,516,875
- --------------------------------------------------------------------------------
9,960,637
- --------------------------------------------------------------------------------
OIL & GAS - MACHINERY/EQUIPMENT (0.61%)
36,200 Cooper Cameron Corporation* 2,185,575
- --------------------------------------------------------------------------------
OIL & GAS - US EXPLORATION & PRODUCTION (1.82%)
278,460 Ocean Energy, Inc.* 6,561,213
- --------------------------------------------------------------------------------
PAPER & PAPER PRODUCTS (0.95%)
75,000 Fort James Corporation 3,435,937
- --------------------------------------------------------------------------------
REAL ESTATE OPERATIONS (1.29%)
163,500 Trammell Crow Co.* 4,659,750
- --------------------------------------------------------------------------------
RETAIL - APPAREL/SHOE (2.48%)
125,000 Ross Stores, Inc. 5,515,625
- --------------------------------------------------------------------------------
75,000 TJX Companies, Inc. 3,393,750
- --------------------------------------------------------------------------------
8,909,375
- --------------------------------------------------------------------------------
RETAIL - MAIL ORDER & DIRECT (1.65%)
150,000 Cendant Corporation* 5,943,750
- --------------------------------------------------------------------------------
RETAIL - MAJOR DISCOUNT CHAINS (1.96%)
80,000 Dayton-Hudson Corporation 7,040,000
- --------------------------------------------------------------------------------
RETAIL - MISCELLANEOUS/DIVERSIFIED (1.28%)
100,000 Hertz Corporation 4,600,000
- --------------------------------------------------------------------------------
RETAIL/WHOLESALE - COMPUTERS/CELLULAR (0.90%)
125,000 Compusa Inc.* 3,250,000
- --------------------------------------------------------------------------------
RETAIL/WHOLESALE - OFFICE SUPPLIES (1.40%)
281,600 Officemax, Inc.* 5,033,600
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - EQUIPMENT (3.30%)
50,000 Nokia Corporation ADR 5,396,875
- --------------------------------------------------------------------------------
100,000 Northern Telecom Ltd. 6,462,500
- --------------------------------------------------------------------------------
11,859,375
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - SERVICES (2.60%)
150,000 Nextel Communications, Inc.* 5,062,500
- --------------------------------------------------------------------------------
100,000 Worldcom, Inc.* 4,306,250
- --------------------------------------------------------------------------------
9,368,750
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (84.47%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
UTILITY - TELEPHONE (1.24%)
125,000 Cincinnati Bell, Inc. $ 4,453,125
- --------------------------------------------------------------------------------
Total Common Stock
(Cost $253,688,951) 304,001,575
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
CONVERTIBLE DEBENTURES (7.77%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
COMPUTER - MEMORY DEVICES (1.23%)
$2,500,000 EMC Corporation - 3.25% 3/15/02 4,421,875
- --------------------------------------------------------------------------------
MEDICAL - NURSING HOMES (1.42%)
4,482,000 Assisted Living Concepts, Inc. - 6.00% 11/1/02 5,092,672
- --------------------------------------------------------------------------------
POLLUTION CONTROL - EQUIPMENT (1.92%)
3,500,000 United States Filter Corporation - 6.00%
9/15/05 6,895,000
- --------------------------------------------------------------------------------
POLLUTION CONTROL - SERVICES (1.87%)
4,400,000 U.S.A. Waste Services, Inc. - 4.50% 6/1/01 6,732,000
- --------------------------------------------------------------------------------
RETAIL - MISCELLANEOUS/DIVERSIFIED (1.34%)
2,100,000 Pier 1 Imports - 5.75% 10/1/03 4,814,250
- --------------------------------------------------------------------------------
Total Convertible Debentures
(Cost $25,398,604) 27,955,797
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
PREFERRED STOCK (3.56%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
FINANCE - EQUITY REIT (0.50%)
75,100 CCA Prison Realty Trust 1,793,022
- --------------------------------------------------------------------------------
LEISURE - SERVICES (0.70%)
22,900 Royal Caribbean Cruises Ltd. 2,530,450
- --------------------------------------------------------------------------------
MEDIA - CABLE TV (1.20%)
60,000 TCI Communications Inc. 4,320,000
- --------------------------------------------------------------------------------
RETAIL - MAIL ORDER & DIRECT (1.16%)
80,000 Cendant Corporation 4,170,000
- --------------------------------------------------------------------------------
Total Preferred Stock
(Cost $11,846,249) 12,813,472
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
48
<PAGE>
BERGER GROWTH & INCOME FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
REPURCHASE AGREEMENT (1.29%) March 31, 1998
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
$4,653,000 Repurchase agreement with State Street Bank,
5.70% dated March 31, 1998, to be repurchased
at $4,653,737 on April 1, 1998, collateralized
by U.S. Treasury Bond, 6.50% - August 20, 2016,
with a value of $4,748,100
(Cost $4,653,000) $ 4,653,000
- --------------------------------------------------------------------------------
Total Repurchase Agreement
(Cost $4,653,000) 4,653,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
US GOVERNMENT AGENCY OBLIGATIONS (1.11%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
$ 4,000,000 Federal Home Loan Mortgage Corporation - 5.00%
4/20/98 3,988,536
- --------------------------------------------------------------------------------
Total US Government Agency Obligations
(Cost $3,988,536) 3,988,536
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
FOREIGN GOVERNMENT OBLIGATIONS (0.29%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
A$ 700,000 Queensland Treasury - Global Note - 8.00%
8/14/01 $ 503,808
- --------------------------------------------------------------------------------
700,000 Queensland Treasury - Global Note - 12.00%
8/15/01 557,342
- --------------------------------------------------------------------------------
Total Foreign Government Obligations
(Cost $1,132,486) 1,061,150
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments (Cost $300,707,826) (98.49%) 354,473,530
- --------------------------------------------------------------------------------
Other assets, less liabilities (1.51%) 5,424,243
- --------------------------------------------------------------------------------
Net Assets (100.00%) $ 359,897,773
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Non-income producing security
A$ - Australian dollars
See notes to financial statements.
49
<PAGE>
BERGER GROWTH & INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at cost $ 300,707,826
- --------------------------------------------------------------------
Investments, at value $ 354,473,530
- --------------------------------------------------------------------
Cash 180
- --------------------------------------------------------------------
Receivables
Investment securities sold 4,647,633
- --------------------------------------------------------------------
Fund shares sold 1,127,234
- --------------------------------------------------------------------
Dividends 245,840
- --------------------------------------------------------------------
Interest 269,503
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Total Assets 360,763,920
- --------------------------------------------------------------------
LIABILITIES
Payables
Fund shares redeemed 243,372
- --------------------------------------------------------------------
Accrued investment advisory fees 224,812
- --------------------------------------------------------------------
Accrued custodian fees 14,009
- --------------------------------------------------------------------
Accrued transfer agent fees 188,149
- --------------------------------------------------------------------
Accrued 12b-1 fees 74,937
- --------------------------------------------------------------------
Accrued audit fees 9,597
- --------------------------------------------------------------------
Accrued administrative service fees 2,998
- --------------------------------------------------------------------
Accrued shareholder reports 95,888
- --------------------------------------------------------------------
Accrued expenses 12,385
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Total Liabilities 866,147
- --------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $ 359,897,773
- --------------------------------------------------------------------
Capital Shares
- --------------------------------------------------------------------
Authorized (Par Value $0.01) Unlimited
- --------------------------------------------------------------------
Shares Outstanding 24,152,616
- --------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER
SHARE $ 14.90
- --------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998
(Unaudited)
- ---------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Income
Dividends $ 1,641,179
- ---------------------------------------------------------------------
Interest 1,135,122
- ---------------------------------------------------------------------
Total Income 2,776,301
- ---------------------------------------------------------------------
Expenses
Investment advisory fees 1,285,096
- ---------------------------------------------------------------------
Administrative services fee 17,134
- ---------------------------------------------------------------------
Accounting fees 19,896
- ---------------------------------------------------------------------
Custodian fees 20,706
- ---------------------------------------------------------------------
Transfer agent fees 460,519
- ---------------------------------------------------------------------
Registration fees 38,208
- ---------------------------------------------------------------------
12b-1 fees 428,366
- ---------------------------------------------------------------------
Audit fees 26,097
- ---------------------------------------------------------------------
Legal fees 10,259
- ---------------------------------------------------------------------
Directors'/Trustees' fees and expenses 15,145
- ---------------------------------------------------------------------
Reports to shareholders 185,231
- ---------------------------------------------------------------------
Other expenses 20,236
- ---------------------------------------------------------------------
Total Expenses 2,526,893
- ---------------------------------------------------------------------
Less fees paid indirectly (19,625)
- ---------------------------------------------------------------------
Less earnings credits (14,685)
- ---------------------------------------------------------------------
Total Expenses, Net 2,492,583
- ---------------------------------------------------------------------
Net Investment Income (loss) 283,718
- ---------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS
Net realized gain (loss) on securities and foreign
currency transactions 55,556,516
- ---------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions (30,529,887)
- ---------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currency Transactions 25,026,629
- ---------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS $ 25,310,347
- ---------------------------------------------------------------------
- ---------------------------------------------------------------------
</TABLE>
See notes to financial statements.
50
<PAGE>
BERGER GROWTH & INCOME FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months
Ended 3/31/98 Year Ended
(Unaudited) 9/30/97
- ---------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ 283,718 $ 2,831,373
- ---------------------------------------------------------------------------------
Net realized gain (loss) on securities and foreign
currency transactions 55,556,516 62,443,462
- ---------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions (30,529,887) 32,101,646
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 25,310,347 97,376,481
- ---------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (472,180) (2,752,207)
- ---------------------------------------------------------------------------------
Net realized gains on investments (59,593,139) (35,161,405)
- ---------------------------------------------------------------------------------
Net Decrease in Net Assets from Dividends and
Distributions to Shareholders (60,065,319) (37,913,612)
- ---------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 27,872,650 50,210,039
- ---------------------------------------------------------------------------------
Net asset value of shares issued in reinvestment
of distributions 57,529,282 36,434,190
- ---------------------------------------------------------------------------------
Payments for shares redeemed (47,772,185) (104,621,754)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived from
Fund Share Transactions 37,629,747 (17,977,525)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 2,874,775 41,485,344
- ---------------------------------------------------------------------------------
NET ASSETS
Beginning of period 357,022,998 315,537,654
- ---------------------------------------------------------------------------------
End of period $359,897,773 $357,022,998
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $254,814,303 $217,184,556
- ---------------------------------------------------------------------------------
Undistributed net investment income (loss) (226,962) (38,500)
- ---------------------------------------------------------------------------------
Undistributed net realized gain (loss) from
investments 51,544,728 55,581,351
- ---------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
securities and foreign currency transactions 53,765,704 84,295,591
- ---------------------------------------------------------------------------------
Total $359,897,773 $357,022,998
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<S> <C> <C>
Shares sold 1,900,345 3,472,770
- ---------------------------------------------------------------------------------
Shares issued to shareholders in reinvestment of
distributions 4,217,401 2,712,734
- ---------------------------------------------------------------------------------
Shares repurchased (3,313,873) (7,277,941)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Shares 2,803,873 (1,092,437)
- ---------------------------------------------------------------------------------
Shares outstanding, beginning of period 21,348,743 22,441,180
- ---------------------------------------------------------------------------------
Shares outstanding, end of period 24,152,616 21,348,743
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
51
<PAGE>
BERGER
BALANCED
FUND
CO-PORTFOLIO JOHN B. JARES
MANAGERS' COMMENTARY PATRICK S. ADAMS
[BERGER BALANCED FUND PHOTO]
PERFORMANCE
After six months of operations the Berger Balanced Fund is off to an excellent
start. The Fund returned 58.10%(1) for the six months ended March 31, 1998,
compared with 17.21% for the S&P 500.(2) We believe that these results are a
testimony to our bottom-up style of balanced fund management.
PERIOD IN REVIEW
The Fund's first six months of operations has seen an investment climate that
has been characterized by extreme volatility. During the fourth-quarter of 1997
world markets were roiled by the Asian financial crisis, only to be followed by
a sharp recovery in the first quarter of 1998. The Balanced Fund took advantage
of this volatility by investing in attractively priced growth stocks during the
market correction in late 1997. The fund's top three sectors have been
technology, consumer cyclicals and consumer staples.
Many of the Fund's holdings appreciated nicely during the first quarter of 1998
as investors returned to stocks that they had aggressively sold during the
height of the Asian financial crisis late in 1997. Our investments in technology
benefited as companies posted solid earnings performance for the 4th quarter of
1997 and valuations bounced back from depressed levels. In addition, our
investments in consumer cyclicals and consumer staples posted nice gains as a
strong U.S. economy propelled many of these companies to a solid earnings
performance for the year ended 1997 and provided a favorable outlook for 1998.
The Fund's performance also benefited from a flight to quality that pushed
prices of U.S. government bonds substantially higher over a short period of time
in late 1997.
As of March 31, equities represented 45% of Fund assets, fixed income
represented 33%, and cash stood at 22%.
We continue to favor technology, consumer staples and consumer cyclicals.
Despite the excellent performance that these sectors have experienced, we
continue to find value on a selective basis. Over the last quarter the Fund's
exposure to technology and consumer cyclicals has increased slightly, while
exposure to consumer staples has slightly decreased.
The fixed-income portion of the portfolio is currently invested in U.S.
government securities with maturities of less than three years. We continue to
believe that the short end of the yield curve offers the best value for
fixed-income investments. In addition, the Fund's fixed-income investments are
intended to preserve capital and provide current income. As such, we intend to
maintain a low level of interest-rate risk and will invest only in
investment-grade securities.
LOOKING AHEAD
We remain cautiously optimistic about the investment outlook for the remainder
of 1998. The U.S. economy is strong, and the impact of the Asian financial
crisis has not been as severe as many investors had feared. However, we must
remain vigilant, as an economy that is too strong could lead to rising interest
rates. In addition, the full impact of the situation in Asia may not be
experienced until later in the year.
We appreciate your investment in the Berger Balanced Fund and will continue to
endeavor to provide high-risk adjusted returns for our shareholders.
1. Performance figures are based on historical results and are not intended to
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.
2. The S&P 500 is an unmanaged index, with dividends reinvested, which consists
of the common stocks of 500 publicly traded U.S. companies. It is a generally
recognized indicator used to measure overall performance of the U.S. stock
market. One cannot invest directly in an index.
52
<PAGE>
BERGER BALANCED FUND
PERFORMANCE OVERVIEW
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF
BERGER BALANCED FUND VS.
S&P 500 INDEX AND COST OF LIVING INDEX
BERGER COST OF
BALANCED S&P 500 LIVING
FUND INDEX INDEX
<S> <C> <C> <C>
9/30/97 $10,000 $10,000 $10,000
10/31/97 $12,660 $9,669 $10,025
11/30/97 $13,610 $10,114 $10,019
12/31/97 $13,789 $10,287 $10,006
1/31/98 $14,093 $10,405 $10,025
2/28/98 $14,934 $11,151 $10,043
3/31/98 $15,810 $11,722 $10,043
BERGER BALANCED FUND*
TOTAL RETURN
As of March 31, 1998
Life of Fund 58.10%
(9/30/97)
*Performance figures are historical and do not
represent future results. Investment returns
and principal value will vary, and you may
have a loss when you sell shares.
</TABLE>
53
<PAGE>
BERGER BALANCED FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (44.05%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
AUTO MANUFACTURERS - DOMESTIC (1.19%)
4,700 Ford Motor Co. $ 304,618
- --------------------------------------------------------------------------------
BEVERAGES - SOFT DRINKS (1.17%)
7,000 Pepsico, Inc. 298,812
- --------------------------------------------------------------------------------
COMPUTER - GRAPHICS (1.23%)
9,100 Cadence Design Systems, Inc.* 315,087
- --------------------------------------------------------------------------------
COMPUTER - LOCAL NETWORKS (1.58%)
10,700 Ascend Communications, Inc.* 405,262
- --------------------------------------------------------------------------------
COMPUTER - MAINFRAMES (2.03%)
5,000 International Business Machines Corporation 519,375
- --------------------------------------------------------------------------------
COMPUTER - MINI/MICRO (1.92%)
5,000 Hewlett-Packard Company 316,875
- --------------------------------------------------------------------------------
4,200 Sun Microsystems, Inc.* 175,218
- --------------------------------------------------------------------------------
492,093
- --------------------------------------------------------------------------------
COMPUTER SOFTWARE - ENTERPRISE (1.41%)
10,800 Parametric Technology Corporation* 359,775
- --------------------------------------------------------------------------------
COSMETICS/PERSONAL CARE (0.65%)
7,000 Dial Corporation 167,562
- --------------------------------------------------------------------------------
DIVERSIFIED OPERATIONS (1.34%)
6,300 Tyco Laboratories, Inc. 344,137
- --------------------------------------------------------------------------------
ELECTRICAL - EQUIPMENT (0.97%)
3,000 Honeywell, Inc. 248,062
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR EQUIPMENT (0.60%)
5,500 Lam Research Corporation* 154,687
- --------------------------------------------------------------------------------
ELECTRONIC - SEMICONDUCTOR MANUFACTURING (3.61%)
9,000 Maxim Integrated Products, Inc.* 327,937
- --------------------------------------------------------------------------------
8,600 Micron Technology, Inc.* 249,937
- --------------------------------------------------------------------------------
4,800 National Semiconductor Corporation* 100,500
- --------------------------------------------------------------------------------
6,600 Xilinx, Inc.* 247,087
- --------------------------------------------------------------------------------
925,461
- --------------------------------------------------------------------------------
FOOD - FLOUR & GRAIN (1.97%)
15,600 Interstate Bakeries 504,075
- --------------------------------------------------------------------------------
FOOD - MISCELLANEOUS PREPARATION (1.07%)
800 International Home Of Food, Inc.* 26,600
- --------------------------------------------------------------------------------
3,600 Unilever N.V. ADR 247,050
- --------------------------------------------------------------------------------
273,650
- --------------------------------------------------------------------------------
LEISURE - GAMING (0.67%)
7,100 Mirage Resorts, Inc.* 172,618
- --------------------------------------------------------------------------------
</TABLE>
COMMON STOCK (44.05%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------------------
<C> <S> <C>
LEISURE - HOTELS & MOTELS (1.79%)
3,600 Capstar Hotel Company* $ 124,875
- --------------------------------------------------------------------------------
10,500 Hilton Hotels Corporation 334,687
- --------------------------------------------------------------------------------
459,562
- --------------------------------------------------------------------------------
MEDICAL - GENERIC DRUGS (0.98%)
10,900 Mylan Laboratories 250,700
- --------------------------------------------------------------------------------
MEDICAL - DRUG/DIVERSIFIED (1.27%)
3,400 American Home Products Corporation 324,275
- --------------------------------------------------------------------------------
OIL & GAS - DRILLING (3.34%)
5,100 Diamond Offshore Drilling, Inc. 231,412
- --------------------------------------------------------------------------------
10,800 Noble Drilling Corporation* 330,075
- --------------------------------------------------------------------------------
5,700 Transocean Offshore, Inc. 293,193
- --------------------------------------------------------------------------------
854,680
- --------------------------------------------------------------------------------
OIL & GAS - U.S. EXPLORATION & PRODUCTION (1.30%)
14,170 Ocean Energy, Inc.* 333,880
- --------------------------------------------------------------------------------
PAPER & PAPER PRODUCTS (2.16%)
6,800 Fort James Corporation 311,525
- --------------------------------------------------------------------------------
4,800 Kimberly-Clark Corporation 240,600
- --------------------------------------------------------------------------------
552,125
- --------------------------------------------------------------------------------
POLLUTION CONTROL - EQUIPMENT (1.18%)
8,600 United States Filter Corporation* 302,075
- --------------------------------------------------------------------------------
RETAIL - MAJOR DISCOUNT CHAINS (1.73%)
7,700 Sears Roebuck & Co. 442,268
- --------------------------------------------------------------------------------
RETAIL - MISCELLANEOUS DIVERSIFIED (1.27%)
30,500 Petsmart Inc.* 325,968
- --------------------------------------------------------------------------------
RETAIL/WHOLESALE OFFICE SUPPLIES (2.14%)
11,900 Office Depot, Inc.* 370,387
- --------------------------------------------------------------------------------
10,000 Officemax, Inc.* 178,750
- --------------------------------------------------------------------------------
549,137
- --------------------------------------------------------------------------------
SOAP & CLEANING PREPARATIONS (1.35%)
4,100 Procter & Gamble Co. 345,937
- --------------------------------------------------------------------------------
TELECOMMUNICATIONS - SERVICES (0.82%)
4,900 Worldcom, Inc.* 211,006
- --------------------------------------------------------------------------------
TEXTILE - MILL HOUSEHOLD (0.98%)
8,000 Mohawk Industries, Inc.* 252,000
- --------------------------------------------------------------------------------
TOBACCO (2.30%)
14,100 Philip Morris Companies, Inc. 587,793
- --------------------------------------------------------------------------------
Total Common Stock
(Cost $10,264,073) 11,276,680
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
54
<PAGE>
BERGER BALANCED FUND
SCHEDULE OF INVESTMENTS (UNAUDITED)
US TREASURY NOTES (27.36%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR
PRINCIPAL AMOUNT MARKET VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
$4,000,000 U S Treasury Note 5.50% 2/28/99 $ 3,998,752
- --------------------------------------------------------------------------------
3,000,000 U S Treasury Note 5.75% 9/30/99 3,006,564
- --------------------------------------------------------------------------------
Total US Treasury Notes
(Cost $6,992,112) 7,005,316
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
US GOVERNMENT AGENCY OBLIGATIONS (22.23%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
2,000,000 Federal Home Loan Mortgage Corporation Discount
Note - 5.48% 4/14/98 1,996,042
- --------------------------------------------------------------------------------
1,500,000 Federal Home Loan Mortgage Corporation Discount
Note - 5.60% 4/2/98 1,499,766
- --------------------------------------------------------------------------------
2,200,000 Federal National Mortgage Association Discount
Note - 5.47% 4/13/98 2,195,989
- --------------------------------------------------------------------------------
Total US Government Agency Obligations
(Cost $5,691,797) 5,691,797
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
PREFERRED STOCK (4.03%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
TRANSPORTATION - RAIL (3.11%)
$ 15,000 Union Pacific Capital Trust(r) 796,875
- --------------------------------------------------------------------------------
RETAIL - MAIL ORDER/DIRECT (0.92%)
4,500 Cendant Corporation 234,576
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Preferred Stock
(Cost $975,000) 1,031,451
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
REPURCHASE AGREEMENT (1.37%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C>
352,000 Repurchase agreement with State Street Bank,
5.70% dated March 31, 1998, to be repurchased at
$352,056 on April 1, 1998, collateralized by
U.S. Treasury Bond, 6.07% - November 1, 2025,
with a value of $362,600
(Cost $352,000) 352,000
- --------------------------------------------------------------------------------
Total Repurchase Agreement
(Cost $352,000) 352,000
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
CONVERTIBLE DEBENTURES (1.03%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SHARES, UNITS OR MARKET
PRINCIPAL AMOUNT VALUE
<C> <S> <C>
- --------------------------------------------------------------------------------
ELECTRICAL - SEMICONDUCTOR EQUIPMENT (0.66%)
200,000 Lam Research Corporation(r) - 5.00% 9/1/02 $ 169,500
- --------------------------------------------------------------------------------
LEISURE - HOTELS & MOTELS (0.37%)
100,000 Capstar Hotel Company - 4.75% 10/15/04 94,250
- --------------------------------------------------------------------------------
Total Convertible Debentures
(Cost $266,250) 263,750
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Investments (Cost $24,541,232) (100.07%) 25,620,994
- --------------------------------------------------------------------------------
Liabilities, less other assets (0.07%) (18,392)
- --------------------------------------------------------------------------------
Net Assets (100.00%) $ 25,602,602
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Non-income producing security.
ADR - American Depository Receipt
(r) Pursuant to Rule 144A, resale is restricted to qualified institutional
buyers.
See notes to financial statements.
55
<PAGE>
BERGER BALANCED FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at cost $24,541,232
- --------------------------------------------------------------------------------
Investments, at value $25,620,994
- --------------------------------------------------------------------------------
Cash 667
- --------------------------------------------------------------------------------
Receivables
Investment securities sold 4,135,845
- --------------------------------------------------------------------------------
Fund shares sold 302,127
- --------------------------------------------------------------------------------
Dividends 6,187
- --------------------------------------------------------------------------------
Interest 22,668
- --------------------------------------------------------------------------------
Other Assets 272
- --------------------------------------------------------------------------------
Total Assets 30,088,760
- --------------------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 4,435,137
- --------------------------------------------------------------------------------
Fund shares redeemed 9,407
- --------------------------------------------------------------------------------
Accrued investment advisory fees 13,850
- --------------------------------------------------------------------------------
Accrued custodian fees 4,133
- --------------------------------------------------------------------------------
Accrued transfer agent fees 6,247
- --------------------------------------------------------------------------------
Accrued 12b-1 fees 4,947
- --------------------------------------------------------------------------------
Accrued audit fees 5,605
- --------------------------------------------------------------------------------
Accrued administrative service fees 198
- --------------------------------------------------------------------------------
Accrued shareholder reports 1,229
- --------------------------------------------------------------------------------
Other expenses 5,405
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Liabilities 4,486,158
- --------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $25,602,602
- --------------------------------------------------------------------------------
Capital Shares
Authorized (Par Value $0.01) Unlimited
- --------------------------------------------------------------------------------
Shares Outstanding 1,895,883
- --------------------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE $ 13.50
- --------------------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Income
Dividends $ 24,209
- --------------------------------------------------------------------------------
Interest 284,877
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Income 309,086
- --------------------------------------------------------------------------------
EXPENSES
Investment advisory fees 61,844
- --------------------------------------------------------------------------------
Administrative services fee 884
- --------------------------------------------------------------------------------
Accounting fees 4,500
- --------------------------------------------------------------------------------
Custodian fees 8,020
- --------------------------------------------------------------------------------
Transfer agent fees 17,615
- --------------------------------------------------------------------------------
Registration fees 9,869
- --------------------------------------------------------------------------------
12b-1 fees 22,088
- --------------------------------------------------------------------------------
Audit fees 8,105
- --------------------------------------------------------------------------------
Legal fees 551
- --------------------------------------------------------------------------------
Directors'/Trustees' fees and expenses 767
- --------------------------------------------------------------------------------
Reports to shareholders 8,964
- --------------------------------------------------------------------------------
Other expenses 150
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Expenses 143,357
- --------------------------------------------------------------------------------
Less fees waived by advisor (10,673)
- --------------------------------------------------------------------------------
Less earnings credits (3,800)
- --------------------------------------------------------------------------------
Total Expenses, Net 128,884
- --------------------------------------------------------------------------------
Net investment income (loss) 180,202
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on securities and foreign currency
transactions 5,748,752
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on
securities and foreign currency transactions 1,079,762
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments and
Foreign Currency Transactions 6,828,514
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 7,008,716
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
56
<PAGE>
BERGER BALANCED FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months
Ended 3/31/98 Period Ended
(Unaudited) 9/30/97*
- --------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ 180,202 $ 0
- --------------------------------------------------------------------------------
Net realized gain (loss) on securities and foreign
currency transactions 5,748,752 0
- --------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions 1,079,762 0
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 7,008,716 0
- --------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (161,019) 0
- --------------------------------------------------------------------------------
Net realized gains on investments (2,535,109) 0
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Net Decrease in Net Assets from Dividends and
Distributions to Shareholders (2,696,128) 0
- --------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 20,374,650 7,461,844
- --------------------------------------------------------------------------------
Net asset value of shares issued in reinvestment
of distributions 2,416,105 0
- --------------------------------------------------------------------------------
Payments for shares redeemed (8,962,585) 0
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Derived from
Fund Share Transactions 13,828,170 7,461,844
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 18,140,758 7,461,844
- --------------------------------------------------------------------------------
NET ASSETS
Beginning of period 7,461,844 0
- --------------------------------------------------------------------------------
End of period $ 25,602,602 $7,461,844
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $ 21,290,014 $7,461,844
- --------------------------------------------------------------------------------
Undistributed net investment income (loss) 19,183 0
- --------------------------------------------------------------------------------
Undistributed net realized gain (loss) from
investments 3,213,643 0
- --------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
securities and foreign currency transactions 1,079,762 0
- --------------------------------------------------------------------------------
Total $ 25,602,602 $7,461,844
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
TRANSACTIONS IN FUND SHARES
<TABLE>
<S> <C> <C>
Shares sold 1,676,033 746,184
- --------------------------------------------------------------------------------
Shares issued to shareholders in reinvestment of
distributions 204,699 0
- --------------------------------------------------------------------------------
Shares repurchased (731,033) 0
- --------------------------------------------------------------------------------
Net Increase (Decrease) in Shares 1,149,699 746,184
- --------------------------------------------------------------------------------
Shares outstanding, beginning of period 746,184 0
- --------------------------------------------------------------------------------
Shares outstanding, end of period 1,895,883 746,184
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
See notes to financial statements.
57
<PAGE>
..............................
NOTES TO
FINANCIAL
STATEMENTS
------------------------------------
- ------------------------------------------------------------------------
1 ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
- --------------------------------------------------------------------------------
ORGANIZATION
The Berger New Generation Fund ("BNG"), Berger Select Fund ("BSEL"), Berger
Small Company Growth Fund ("BSCG"), Berger Small Cap Value Fund ("BSCV"), Berger
Mid Cap Growth Fund ("BMCG"), Berger One Hundred Fund ("100"), Berger/BIAM
International Fund ("BBIF"), Berger Growth and Income Fund ("BG&I") and Berger
Balanced Fund ("BBAL")(individually the "Fund" and collectively, the "Funds")
are diversified open-end management investment companies registered under the
Investment Company Act of 1940 (the "1940 Act"). Shares of each fund are fully
paid and non-assessable when issued. All shares issued by a particular Fund
participate equally in dividends and other distributions by that Fund. The
investment objective of each Fund is capital appreciation, including the BBAL
and BG&I, which also pursue current income.
The 100 and BG&I are corporations registered in the State of Maryland. BSCG,
BNG, BSEL, BMCG and BBAL are separate series established under the Berger
Investment Portfolio Trust, a Delaware business trust ("BIP Trust"). BSEL and
BMCG commenced operations on December 31, 1997. BSCV is the only portfolio
established under the Berger Omni Investment Trust ("OMNI Trust"), a
Massachusetts business trust, and offers two separate classes of shares;
Investor Shares ("BSCV; Inv") and Institutional Shares ("BSCV; Inst"). Both
classes have identical rights to earnings, assets and voting privileges. The
BBIF is one of three series established under the Berger/BIAM Worldwide Funds
Trust ("BBWF Trust"), a Delaware business trust. Other series or portfolios may
be added under each Trust in the future. All costs in organizing the Trusts were
paid by Berger Associates, Inc. ("Berger") or BBOI Worldwide LLC ("BBOI").
BBIF invests all of its investable assets in the Berger/BIAM International
Portfolio (the "Portfolio"), a series of Berger/ BIAM Worldwide Portfolios Trust
("BBWP Trust"). The value of such investment reflects BBIF's proportionate
interest in the net assets of the Portfolio (11% at March 31, 1998). The
Portfolio is an open-end management investment company and has the same
investment objective and policies as BBIF. The performance of BBIF will be
derived from the investment performance of the Portfolio. The financial
statements of the Portfolio, including the schedule of portfolio investments,
are included elsewhere in this report and should be read in conjunction with
BBIF's financial statements.
SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Funds in the preparation of their financial statements. The
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATION
Securities are valued at the close of the regular trading session of the New
York Stock Exchange (the "Exchange") on each day that the Exchange is open.
Securities listed on national exchanges, the NASDAQ Stock Market and foreign
exchanges are valued at the last sale price on such markets, or, if no last sale
price is available, they are valued using the mean between their current bid and
asked prices. Securities traded in the over-the-counter market are valued at the
mean between their current bid and asked prices. Short-term obligations maturing
within sixty days are valued at amortized cost, which approximates market value.
Prices of foreign securities are converted to U.S. dollars using exchange rates
determined prior to the close of the Exchange. Securities for which quotations
are not readily available are valued at fair values as determined in good faith
pursuant to consistently applied procedures established by the
directors/trustees.
Generally, trading in foreign securities markets is substantially completed each
day at various times prior to the close of the Exchange. The values of foreign
securities are determined as of the earlier of such market close or the closing
time of the Exchange. Occasionally, events affecting the value of such
securities may occur between the times at which they are determined and the
close of the Exchange, or when the foreign market on which such securities trade
is closed but the Exchange is open, which will not be reflected in the
computation of net asset value. If during such periods, events occur that
materially affect the value of such securities, the securities will be valued at
their fair market value as determined in good faith pursuant to consistently
applied procedures established by the directors/trustees.
Since BBIF invests all of its investable assets in the Portfolio, the value of
BBIF's investable assets will be equal to the value of its beneficial interest
in the Portfolio. Valuation of securities by the Portfolio is discussed in Note
1 of the Portfolio's Notes to Financial Statements, which are included elsewhere
in this report.
CALCULATION OF NET ASSET VALUE
Each Fund's per share calculation of net asset value is determined by dividing
the total value of its assets, less liabilities, by the total number of shares
outstanding.
FEDERAL INCOME TAXES
It is the Funds' policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of their
taxable income to shareholders. Therefore, no income tax provision is required.
FOREIGN CURRENCY TRANSLATION
Assets and liabilities initially expressed in terms of foreign currencies are
translated into U.S. dollars at the prevailing
58
<PAGE>
- --------------------------------------------------------------------------------
1 ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- --------------------------------------------------------------------------------
market rates as quoted by one or more banks or dealers on the date of valuation.
The cost of securities is translated into U.S. dollars at the rates of exchange
prevailing when such securities were acquired. Income and expenses are
translated into U.S. dollars at rates of exchange prevailing when accrued.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for on the date investments are purchased
or sold. Dividend income is recorded on the ex-dividend date, except if the
ex-dividend date has passed, certain dividends from foreign securities are
reported as soon as the Fund is informed of the ex-dividend date. Interest
income is recorded on the accrual basis and includes amortization of discounts
and premiums. Gains and losses are computed on the identified cost basis for
both financial statement and federal income tax purposes for all securities.
ALLOCATION OF INCOME, EXPENSES AND GAINS AND LOSSES
Income, expenses (other than those attributable to a specific class) and gains
and losses of the BSCV are allocated daily to each class of shares based upon
the proportion of relative net assets represented by each class as a percentage
of total net assets of the BSCV. Expenses directly attributable to a specific
class are charged against the operations of such class.
As an investor in the Portfolio, BBIF is allocated its pro rata share of the
aggregate investment income, realized and unrealized gains or losses and annual
operating expenses (including the investment advisory fee, custodian fees,
independent accountants' fees, record keeping and pricing agent fees) of the
Portfolio. Income and expenses are allocated on the day the income is earned or
the expense is incurred in proportion to the prior day's relative net assets of
the BBIF and other investors in the Portfolio.
COMMON EXPENSES
Certain expenses that are not directly allocable to a specific Fund are
allocated to the Funds on the basis of relative net assets.
USE OF ESTIMATES
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 increases and decreases in net assets from operations
during the reporting period. Actual results may differ from those estimates.
- --------------------------------------------------------------------------------
2 AGREEMENTS
- --------------------------------------------------------------------------------
Berger renders investment advisory services to BNG, BSEL, BSCG, BSCV, BMCG, 100,
BG&I and BBAL pursuant to agreements that provide for an investment advisory fee
to be paid to Berger at the following annual rates as a percentage of average
daily net assets; BNG, BSCG and BSCV -- .90%; 100, BSEL, BMCG, and BG&I -- .75%;
and BBAL -- .70%. Berger has delegated the day-to-day investment management of
the BSCV to Perkins, Wolf & McDonnell ("PWM"). As compensation for services
rendered to the BSCV, PWM receives a sub-advisory fee from Berger at an annual
rate of .90% of the BSCV's average daily net assets up to $75 million; .50% of
average daily net assets between $75 million and $200 million and .20% of
average daily net assets in excess of $200 million. All investment advisory fees
are accrued daily and paid monthly. Berger has also agreed to voluntarily waive
its advisory fee for the BNG, BSEL, BMID and BBAL to the extent that the each
Fund's normal operating expenses in any fiscal year (including the management
fee and the 12b-1 fee, but excluding brokerage commissions, interest, taxes and
extraordinary expenses) exceeds 1.90%, 2.00%, 2.00% and 1.50%, respectively, of
each Fund's average daily net assets for that fiscal year.
Pursuant to an Administrative Services Agreement, whereby BBOI serves as the
administrator to BBIF, the Fund pays BBOI a fee at an annual rate equal to the
lesser of 0.45% of its average daily net assets or BBOI's annual cost to provide
or procure such services plus 0.02% of the Fund's average daily net assets.
Under the Agreement, BBOI is responsible, at its own expense, for providing or
procuring administrative services reasonably necessary for the operation of the
Fund, including record keeping and pricing services, custodian services,
transfer agency and dividend disbursing services, tax and audit services,
insurance, printing and mailing to shareholders of prospectuses and other
required communication and certain other administrative services. BBOI has
delegated the administration of the Fund to Berger. For such services, BBOI has
agreed to compensate Berger with a sub-administration fee equal to 0.25% per
annum of the Fund's average daily net assets. Berger has voluntarily waived such
fee for the period ended March 31, 1998.
The Funds have adopted plans pursuant to Rule 12b-1 under the Investment Company
Act of 1940 (the "Plans"). The BSCV Plan, which became effective February 14,
1997, applies only to the BSCV; Inv. The Plans provide for the payment to Berger
of a 12b-1 fee of .25% per annum of each Fund's average daily net assets (or the
net assets of a particular class of shares, where applicable) to finance
activities primarily intended to result in the sale of shares. The Plans provide
that such payments will be made to Berger as compensation rather than as
reimbursements for actual expenses incurred to promote the sale of shares of the
Funds.
59
<PAGE>
- --------------------------------------------------------------------------------
2 AGREEMENTS - CONTINUED
- --------------------------------------------------------------------------------
The BNG, BSEL, BSCG, BSCV, BMCG, 100, BG&I and BBAL have each entered into an
administrative services agreement with Berger. The administrative services
agreement provides for an annual fee of .01 of 1% of the average daily net
assets of each Fund, computed daily and payable monthly. The Funds have also
entered into record keeping and pricing agreements with Investors Fiduciary
Trust Company ("IFTC"), which also serves as the Funds' custodian and transfer
agent. The record keeping and pricing agreement provides for the monthly payment
of a base fee plus a fee computed as a percentage of average daily net assets on
a total relationship basis with other Berger Funds. IFTC's fees for custody,
record keeping and pricing or transfer agency services are subject to reduction
by credits earned by each Fund, based on the cash balances of each Fund held by
IFTC as custodian or by credits received from directed brokerage transactions.
DST Systems, Inc. ("DST"), an affiliate of Berger through a degree of common
ownership, provides shareholder accounting services to the Funds as a
sub-transfer agent. DST Securities, Inc., a wholly owned subsidiary of DST, is
designated as an introductory broker on certain portfolio transactions. The
Funds receive an amount equal to the brokerage commissions paid to DST
Securities, Inc. as credits against transfer agent fees and expenses. For the
period ended March 31, 1998, the BNG, BSEL, BSCG, BSCV, BMCG, 100, BG&I, and
BBAL earned $17,599, $244, $34,878, $7,447, $53, $75,556, $14,685 and $3,800 of
such credits, respectively.
Certain officers and directors of Berger and BBOI are also officers and/or
directors/trustees of the Funds. Directors/ trustees who are not affiliated with
Berger or BBOI received aggregate directors'/trustees' fees from the Funds
totaling $140,274 for the periods ended March 31, 1998.
- --------------------------------------------------------------------------------
3 INVESTMENT TRANSACTIONS
- --------------------------------------------------------------------------------
PURCHASES AND SALES
Purchases and sales of investment securities (excluding short-term securities)
during the periods ended March 31, 1998, were as follows:
<TABLE>
<CAPTION>
Fund Purchases Sales
- -----------------------------------------------------------
<S> <C> <C>
BNG $ 152,131,328 $ 166,981,034
- -----------------------------------------------------------
BSEL 83,598,686 75,395,097
- -----------------------------------------------------------
BSCG 306,677,087 365,055,250
- -----------------------------------------------------------
BSCV 98,355,681 45,354,422
- -----------------------------------------------------------
BMCG 4,422,043 1,677,954
- -----------------------------------------------------------
100 2,414,710,812 2,464,641,114
- -----------------------------------------------------------
BBIF(1) NA NA
- -----------------------------------------------------------
BG&I 507,752,835 501,380,723
- -----------------------------------------------------------
BBAL 93,078,977 82,486,233
- -----------------------------------------------------------
</TABLE>
1. See the Portfolio's Notes to Financial Statements for information regarding
purchases and sales of investment securities.
There were no purchases or sales of long-term government securities during the
periods ended March 31, 1998.
At March 31, 1998, the composition of unrealized appreciation (the excess of
value over tax cost) and unrealized depreciation (the excess of tax cost over
value) for securities was as follows:
<TABLE>
<CAPTION>
Unrealized Unrealized
Fund Federal Tax Cost Appreciation Depreciation Net
- ---------------------------------------------------------------------------
<S> <C> <C> <C> <C>
BNG $ 107,476,808 $ 39,085,571 $ (2,458,369) $ 36,627,202
- ---------------------------------------------------------------------------
BSEL 20,605,376 458,450 (162,546) 295,904
- ---------------------------------------------------------------------------
BSCG 503,429,799 344,445,493 (11,699,919) 332,745,574
- ---------------------------------------------------------------------------
BSCV 160,519,682 22,953,442 (2,648,116) 20,305,326
- ---------------------------------------------------------------------------
BMCG 3,231,496 278,150 (27,289) 250,861
- ---------------------------------------------------------------------------
100 1,642,546,453 242,308,651 (24,821,160) 217,487,491
- ---------------------------------------------------------------------------
BBIF(1) NA NA NA NA
- ---------------------------------------------------------------------------
BG&I 300,707,693 55,366,528 (1,600,691) 53,765,837
- ---------------------------------------------------------------------------
BBAL 24,541,232 1,177,893 (98,131) 1,079,762
- ---------------------------------------------------------------------------
</TABLE>
1. See the Portfolio's Notes to Financial Statements for the composition of net
unrealized appreciation.
FUTURES, FORWARD CONTRACTS AND OPTIONS
Each Fund may hold certain types of futures, forward contracts and/or options
for the purpose of hedging each portfolio against exposure to market value
fluctuations. The use of such instruments may involve certain risks as a result
of unanticipated movements in the market. A lack of correlation between the
value of such instruments and the assets being hedged, or unexpected adverse
price movements, could render the Funds' hedging strategy unsuccessful. In
addition, there can be no assurance that a liquid secondary market will exist
for the instrument. Realized gains or losses on these securities are included in
Net Realized Gain (Loss) on Securities Transactions in the Statements of
Operations.
60
<PAGE>
- --------------------------------------------------------------------------------
3 INVESTMENT TRANSACTIONS - CONTINUED
- --------------------------------------------------------------------------------
FEDERAL INCOME TAX STATUS
Dividends paid by the Funds from net investment income and distributions of net
realized short-term capital gains are, for federal income tax purposes, taxable
as ordinary income to shareholders. Of the ordinary income distributions
declared for the period ended September 30, 1997, 100% qualified for the
dividends received deduction available to the corporate shareholders of the
Berger Growth and Income Fund.
The Funds distribute net realized capital gains, if any, to their shareholders
at least annually, if not offset by capital loss carryovers. Income
distributions and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to the differing treatment for
net operating losses. Accordingly, these permanent differences in the character
of income and distributions between financial statements and tax basis have been
reclassified to paid-in-capital.
At March 31, 1998, BNG had capital loss carryovers in the amount of $7,485,327,
expiring on September 30, 2005, which may be used of offset future realized
capital gains for federal income tax purposes.
- --------------------------------------------------------------------------------
4 LINE OF CREDIT
- --------------------------------------------------------------------------------
BNG, BSCG, BSCV, 100, BG&I, and the Portfolio are party to an ongoing agreement
with certain banks that allows the Funds, collectively, to borrow up to $150
million for temporary or emergency purposes. Interest on the borrowings, if any,
is charged to the specific fund executing the borrowing at the Federal Funds
Rate plus 75 basis points. In addition, the line of credit requires a quarterly
payment of a commitment fee based on the average daily unused portion of the
line of credit.
During the six months ended March 31, 1998, BNG incurred interest expense
totaling $27,000 as a result of borrowings against the line of credit. At March
31, 1998, the outstanding line of credit balance was $0.
- --------------------------------------------------------------------------------
5 OTHER MATTERS
- --------------------------------------------------------------------------------
Effective November 17, 1997, the BSCG was closed to new investors. During the
period for which the Fund is closed to new investors, Berger shall reduce the
12b-1 fee payable by the Fund by the amount of such fee that is not utilized by
Berger to provide or to compensate third party administrators or other companies
for providing shareholder services to Fund shareholders in connection with the
distribution of Fund shares.
61
<PAGE>
..............................
BERGER/BIAM
INTERNATIONAL
PORTFOLIO
----------------------------------------
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (93.31%) March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COUNTRY/SHARES MARKET
PRINCIPAL AMOUNT COMPANY INDUSTRY VALUE
- ------------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
AUSTRALIA (4.91%)
260,200 National Australia Bank Commercial Banks & Other Banks $ 3,706,548
- ------------------------------------------------------------------------------------------------------------------------------
573,400 News Corporation Media 3,785,949
- ------------------------------------------------------------------------------------------------------------------------------
428,750 Telstra Corporation Utilities 1,104,525
- ------------------------------------------------------------------------------------------------------------------------------
135,150 Western Mining Mining, Metals & Minerals 463,625
- ------------------------------------------------------------------------------------------------------------------------------
9,060,647
- ------------------------------------------------------------------------------------------------------------------------------
CANADA (0.52%)
16,300 Royal Bank Of Canada Commercial Banks & Other Banks 966,525
- ------------------------------------------------------------------------------------------------------------------------------
DENMARK (0.37%)
7,450 Tele Danmark As-b Utilities 676,945
- ------------------------------------------------------------------------------------------------------------------------------
FRANCE (2.91%)
690 AXA-UAP Insurance Multi/Property/Casualty 71,146
- ------------------------------------------------------------------------------------------------------------------------------
4,405 Generale Des Eaux Diversified Holdings Companies 716,190
- ------------------------------------------------------------------------------------------------------------------------------
30,455 Michelin B Auto Components 1,820,655
- ------------------------------------------------------------------------------------------------------------------------------
22,970 Total Co. Francaise Petrole B Oil 2,761,968
- ------------------------------------------------------------------------------------------------------------------------------
5,369,959
- ------------------------------------------------------------------------------------------------------------------------------
GERMANY (8.32%)
970 Bayerische Motoren Werke Automobiles 1,073,723
- ------------------------------------------------------------------------------------------------------------------------------
12,400 Bayerische Vereinsbank Commercial Banks & Other Banks 906,113
- ------------------------------------------------------------------------------------------------------------------------------
46,845 Hoechst Ag Chemicals 1,837,083
- ------------------------------------------------------------------------------------------------------------------------------
7,640 Mannesmann Ag Machinery & Engineering Services 5,599,372
- ------------------------------------------------------------------------------------------------------------------------------
29,790 Siemens Ag Electrical Equipment 1,996,266
- ------------------------------------------------------------------------------------------------------------------------------
38,631 Veba Ag Diversified Industrials 2,743,450
- ------------------------------------------------------------------------------------------------------------------------------
2,177 Viag Ag Utilities 1,187,808
- ------------------------------------------------------------------------------------------------------------------------------
15,343,815
- ------------------------------------------------------------------------------------------------------------------------------
GREAT BRITAIN (30.62%)
185,150 Barclays PLC Commercial Banks & Other Banks 5,548,774
- ------------------------------------------------------------------------------------------------------------------------------
522,890 BAT Industries Beverage Industry/Tobacco Manufacturing 5,331,481
- ------------------------------------------------------------------------------------------------------------------------------
183,200 Cable & Wireless Utilities 2,292,751
- ------------------------------------------------------------------------------------------------------------------------------
127,200 Cadbury Schweppes Beverage Industry/Tobacco Manufacturing 1,765,476
- ------------------------------------------------------------------------------------------------------------------------------
220,300 Diageo PLC Beverage Industry/Tobacco Manufacturing 2,592,928
- ------------------------------------------------------------------------------------------------------------------------------
149,700 Glaxo Wellcome PLC Health & Personal Care 4,027,708
- ------------------------------------------------------------------------------------------------------------------------------
217,650 Granada Group Entertainment/Leisure/Toys 3,913,661
- ------------------------------------------------------------------------------------------------------------------------------
85,514 Kingfisher PLC Retail Trade 1,602,092
- ------------------------------------------------------------------------------------------------------------------------------
316,400 Ladbroke Group Entertainment/Leisure/Toys 1,770,631
- ------------------------------------------------------------------------------------------------------------------------------
262,200 Lloyds TSB Group Commercial Banks & Other Banks 4,078,201
- ------------------------------------------------------------------------------------------------------------------------------
95,800 Premier Farnell Wholesale Trade 615,107
- ------------------------------------------------------------------------------------------------------------------------------
297,640 Prudential Corporation Insurance Life & Agents/Brokers 4,375,282
- ------------------------------------------------------------------------------------------------------------------------------
226,450 Safeway PLC Retail Trade 1,404,691
- ------------------------------------------------------------------------------------------------------------------------------
66,500 Scottish Power Utilities 625,717
- ------------------------------------------------------------------------------------------------------------------------------
463,880 Shell Transportation & Trading Corporation Oil 3,409,498
- ------------------------------------------------------------------------------------------------------------------------------
145,391 Siebe PLC Machinery & Engineering Services 3,171,774
- ------------------------------------------------------------------------------------------------------------------------------
213,300 TI Group PLC Machinery & Engineering Services 1,871,295
- ------------------------------------------------------------------------------------------------------------------------------
364,600 Vodafone Group Utilities 3,815,197
- ------------------------------------------------------------------------------------------------------------------------------
99,330 Zeneca Group Health & Personal Care 4,280,645
- ------------------------------------------------------------------------------------------------------------------------------
56,492,909
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
62
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
SCHEDULE OF INVESTMENTS (UNAUDITED)
COMMON STOCK (93.31%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COUNTRY/SHARES MARKET
PRINCIPAL AMOUNT COMPANY INDUSTRY VALUE
- ------------------------------------------------------------------------------------------------------------------------------
HONG KONG (1.17%)
<C> <S> <C> <C>
70,400 HSBC Holdings Commercial Banks & Other Banks $ 2,153,238
- ------------------------------------------------------------------------------------------------------------------------------
INDONESIA (0.25%)
212,000 Gudang Garam Beverage Industry/Tobacco Manufacturing 293,491
- ------------------------------------------------------------------------------------------------------------------------------
180,000 HM Sampoerna Beverage Industry/Tobacco Manufacturing 163,352
- ------------------------------------------------------------------------------------------------------------------------------
456,843
- ------------------------------------------------------------------------------------------------------------------------------
IRELAND (0.40%)
257,100 Smurfit (Jefferson) Group Forestry & Paper Products 737,611
- ------------------------------------------------------------------------------------------------------------------------------
ITALY (1.83%)
69,006 Eni Spa Itl Oil 470,650
- ------------------------------------------------------------------------------------------------------------------------------
368,030 Telecom Italia Utilities 2,903,213
- ------------------------------------------------------------------------------------------------------------------------------
3,373,863
- ------------------------------------------------------------------------------------------------------------------------------
JAPAN (13.18%)
199,000 Canon Inc Computer/Commercial/Office Equipment 4,497,766
- ------------------------------------------------------------------------------------------------------------------------------
87,000 Dai Nippon Printing Media 1,437,206
- ------------------------------------------------------------------------------------------------------------------------------
107,000 Honda Motor Automobiles 3,856,579
- ------------------------------------------------------------------------------------------------------------------------------
106,000 Kao Corporation Food & Grocery 1,392,904
- ------------------------------------------------------------------------------------------------------------------------------
9,400 Keyence Corporation Electronics & Instruments 1,298,742
- ------------------------------------------------------------------------------------------------------------------------------
42,000 Murata Manufacturing Co Electronics & Instruments 1,160,578
- ------------------------------------------------------------------------------------------------------------------------------
17,000 Rohm Company Limited Electronics & Instruments 1,557,349
- ------------------------------------------------------------------------------------------------------------------------------
101,000 Shiseido Corporation Health & Personal Care 1,160,352
- ------------------------------------------------------------------------------------------------------------------------------
53,200 Sony Corporation Household Durables & Appliances 4,514,060
- ------------------------------------------------------------------------------------------------------------------------------
135,000 Takeda Chemical Health & Personal Care 3,436,455
- ------------------------------------------------------------------------------------------------------------------------------
24,311,991
- ------------------------------------------------------------------------------------------------------------------------------
MALAYSIA (0.30%)
103,000 Hume Industries Construction & Building Materials 111,442
- ------------------------------------------------------------------------------------------------------------------------------
403,400 Sime Darby Diversified Holdings Companies 449,691
- ------------------------------------------------------------------------------------------------------------------------------
561,133
- ------------------------------------------------------------------------------------------------------------------------------
MEXICO (0.42%)
301,770 Grupo Financiero Banamex Commercial Banks & Other Banks 768,277
- ------------------------------------------------------------------------------------------------------------------------------
NETHERLANDS (8.72%)
76,280 ABN-Amro Holdings Commercial Banks & Other Banks 1,762,068
- ------------------------------------------------------------------------------------------------------------------------------
105,150 Elsevier Media 1,732,090
- ------------------------------------------------------------------------------------------------------------------------------
119,807 ING Groep N.V. Insurance - Multi/Property/Casualty 6,806,660
- ------------------------------------------------------------------------------------------------------------------------------
52,790 Koninklijke PTT Utilities 2,738,057
- ------------------------------------------------------------------------------------------------------------------------------
31,300 Nutricia Food Manufacturing 1,125,883
- ------------------------------------------------------------------------------------------------------------------------------
33,800 Royal Dutch Petroleum Oil 1,915,428
- ------------------------------------------------------------------------------------------------------------------------------
16,080,186
- ------------------------------------------------------------------------------------------------------------------------------
PHILIPPINES (0.24%)
254,370 San Miguel Corporation Class-B Beverage Industry/Tobacco Manufacturing 443,375
- ------------------------------------------------------------------------------------------------------------------------------
PORTUGAL (0.25%)
19,950 Electricidade De Portugal Utilities 463,426
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
63
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
COMMON STOCK (93.31%) - CONTINUED March 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
COUNTRY/SHARES MARKET
PRINCIPAL AMOUNT COMPANY INDUSTRY VALUE
- ------------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
SINGAPORE (3.03%)
285,000 City Development Real Estate $ 1,403,375
- ------------------------------------------------------------------------------------------------------------------------------
233,412 Development Bank of Singapore Commercial Banks & Other Banks 1,705,953
- ------------------------------------------------------------------------------------------------------------------------------
174,600 Fraser And Neave Beverage Industry/Tobacco Manufacturing 740,792
- ------------------------------------------------------------------------------------------------------------------------------
151,972 Singapore Press Holdings Media 1,741,390
- ------------------------------------------------------------------------------------------------------------------------------
5,591,510
- ------------------------------------------------------------------------------------------------------------------------------
SPAIN (1.67%)
61,680 Banco de Santander Commercial Banks & Other Banks 3,075,936
- ------------------------------------------------------------------------------------------------------------------------------
SWITZERLAND (14.20%)
1,675 Alusuisse Lonza Holdings Fabricated Metal Products 2,035,370
- ------------------------------------------------------------------------------------------------------------------------------
2,634 Nestle Sa Food & Grocery Products 5,039,799
- ------------------------------------------------------------------------------------------------------------------------------
4,609 Novartis Ag-RE Health & Personal Care 8,167,809
- ------------------------------------------------------------------------------------------------------------------------------
269 Roche Holding Health & Personal Care 2,915,366
- ------------------------------------------------------------------------------------------------------------------------------
2,680 Schw Ruckverischer Insurance - Multi/Property/Casualty 5,895,313
- ------------------------------------------------------------------------------------------------------------------------------
1,315 Union Bank of Switzerland Insurance - Multi/Property/Casualty 2,150,745
- ------------------------------------------------------------------------------------------------------------------------------
26,204,402
- ------------------------------------------------------------------------------------------------------------------------------
Total Common Stock (Cost $146,828,511) 172,132,591
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
REPURCHASE AGREEMENT (4.51%)
- --------------------------------------------------------------------------------
<TABLE>
<C> <S> <C> <C>
$ 8,321,000 State Street Bank Repurchase Agreement, 5.70%
dated March 31, 1998, to be repurchased at
$8,322,317 on April 1, 1998, collateralized
by U.S. Treasury Bond, 6.75% - June 25, 2005,
with a value of $8,491,700 (Cost $8,321,000) N/A 8,321,000
- ------------------------------------------------------------------------------------------------------------------------------
Total Repurchase Agreement (Cost $8,321,000) 8,321,000
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
Total Investments (Cost $155,149,511) (97.82%) 180,453,591
- ------------------------------------------------------------------------------------------------------------------------------
Other assets, less liabilities (2.18%) 4,028,788
- ------------------------------------------------------------------------------------------------------------------------------
Net Assets (100.00%) $ 184,482,379
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
64
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
ASSETS
Investments, at cost $155,149,511
- --------------------------------------------------------------------------------
Investments, at value $180,453,591
- --------------------------------------------------------------------------------
Cash 4,432,884
- --------------------------------------------------------------------------------
Foreign cash (cost $1,476,766) 1,487,906
- --------------------------------------------------------------------------------
Receivables
Investment securities sold 611,994
- --------------------------------------------------------------------------------
Contributions 354,601
- --------------------------------------------------------------------------------
Dividends 754,306
- --------------------------------------------------------------------------------
Interest 1,317
- --------------------------------------------------------------------------------
Foreign currency contracts 709,740
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Assets 188,806,339
- --------------------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 4,136,263
- --------------------------------------------------------------------------------
Withdrawals 40,012
- --------------------------------------------------------------------------------
Accrued investment advisory fees 135,470
- --------------------------------------------------------------------------------
Accrued audit fees 12,215
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Liabilities 4,323,960
- --------------------------------------------------------------------------------
NET ASSETS REPRESENTED BY: PAID-IN CAPITAL FOR BENEFICIAL
INTERESTS $184,482,379
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Six months
ended March 31, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME
Income
Dividends (net of $52,815 foreign tax withheld) $ 997,728
- --------------------------------------------------------------------------------
Interest 153,741
- --------------------------------------------------------------------------------
Total Income 1,151,469
- --------------------------------------------------------------------------------
EXPENSES
Investment advisory fees 636,279
- --------------------------------------------------------------------------------
Accounting fees 20,846
- --------------------------------------------------------------------------------
Custodian fees 52,170
- --------------------------------------------------------------------------------
Audit fees 30,216
- --------------------------------------------------------------------------------
Legal fees 5,192
- --------------------------------------------------------------------------------
Directors'/Trustees' fees and expenses 5,945
- --------------------------------------------------------------------------------
Reports to shareholders 3,151
- --------------------------------------------------------------------------------
Other expenses 5,795
- --------------------------------------------------------------------------------
Total Expenses 759,594
- --------------------------------------------------------------------------------
Less fees waived by advisor (46,645)
- --------------------------------------------------------------------------------
Less earnings credits (73,015)
- --------------------------------------------------------------------------------
Total Expenses, Net 639,934
- --------------------------------------------------------------------------------
Net investment income (loss) 511,535
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on securities and foreign
currency transactions (4,371,369)
- --------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on
securities and foreign currency transactions 18,736,707
- --------------------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments
and Foreign Currency Transactions 14,365,338
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS $ 14,876,873
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
See notes to financial statements.
65
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six Months Period From
Ended 3/31/98 10/11/96*
(Unaudited) to 9/30/97
- ------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS
Net investment income (loss) $ 511,535 $ 1,018,078
- ------------------------------------------------------------------------------------
Net realized gain (loss) on securities and foreign
currency transactions (4,371,369) 1,712,223
- ------------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions 18,736,707 6,712,560
- ------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations 14,876,873 9,442,861
- ------------------------------------------------------------------------------------
FROM TRANSACTIONS IN INVESTORS' BENEFICIAL INTEREST
Contributions 63,796,915 127,144,416
- ------------------------------------------------------------------------------------
Withdrawals (16,408,409) (14,370,277)
- ------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets From
Investors' Transactions 47,388,506 112,774,139
- ------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 62,265,379 122,217,000
- ------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 122,217,000 0
- ------------------------------------------------------------------------------------
End of period $184,482,379 $ 122,217,000
- ------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $160,162,645 $ 112,774,139
- ------------------------------------------------------------------------------------
Undistributed net investment income (loss) 1,529,613 1,018,078
- ------------------------------------------------------------------------------------
Undistributed net realized gain (loss) from
investments (2,659,146) 1,712,223
- ------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
securities and foreign currency transactions 25,449,267 6,712,560
- ------------------------------------------------------------------------------------
Total $184,482,379 $ 122,217,000
- ------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTARY DATA
Net assets, end of period (in thousands) $ 184,482 $ 122,217
- ------------------------------------------------------------------------------------
Net expense ratio to average net assets 0.90%(1) 0.89%(1)
- ------------------------------------------------------------------------------------
Ratio of net income (loss) to average net assets 0.72%(1) 1.63%(1)
- ------------------------------------------------------------------------------------
Gross expenses to average net assets(2) 1.07%(1) 1.10%(1)
- ------------------------------------------------------------------------------------
Portfolio turnover rate 8% 17%
- ------------------------------------------------------------------------------------
Average Commission Paid $ 0.0213 $ 0.0248
- ------------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
1. Annualized.
2. During the period, certain fees were reduced as a result of voluntary fee
reductions and/or earning credits. If such earning credits and/or voluntary fee
reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
66
<PAGE>
..............................
NOTES TO
FINANCIAL
STATEMENTS
------------------------------------
- ------------------------------------------------------------------------
1 ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
- --------------------------------------------------------------------------------
ORGANIZATION
The Berger/BIAM International Portfolio (the "Portfolio") is registered under
the Investment Company Act of 1940, as amended, as an open-end management
investment company. The Portfolio is a series of the Berger/BIAM Worldwide
Portfolios Trust (the "Trust"), which was organized as a Delaware business trust
on May 31, 1996. All costs in organizing the Trust were paid by BBOI Worldwide
LLC ("BBOI"), the investment advisor of the Portfolio. The Portfolio commenced
investment operations on October 11, 1996, ("Commencement of Investment
Operations") with the sale of 448,161 shares of beneficial interest to the
International Equity Fund, formerly known as the Berger/BIAM International
Institutional Fund, in exchange for portfolio assets with an aggregate value of
$4,481,609, which were transferred from the Pooled Trust of Citizens Bank of New
Hampshire ("Citizens NH") to the International Equity Fund and, in turn,
transferred to the Portfolio. Such transaction was a tax-free exchange. Citizens
NH is an affiliate of Bank of Ireland Asset Management (U.S.) Limited ("BIAM"),
which was the investment sub-advisor to the Pooled Trust and is the investment
sub-advisor to the Portfolio. Currently there are three investors in the
Portfolio, the Berger/BIAM International Fund, the International Equity Fund and
the Berger/BIAM International CORE Fund.
The investment objective of the Portfolio is long-term capital appreciation. The
Portfolio invests primarily in common stocks of well-established companies
located outside the United States.
The Portfolio is advised by BBOI, which has delegated daily portfolio management
of the Portfolio to BIAM. Berger Associates, Inc. ("Berger") and BIAM each own
50% of BBOI.
SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Portfolio in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATION
The Portfolio's securities and other assets are valued at the close of the
regular trading session of the New York Stock Exchange (the "Exchange")
(normally 4:00 p.m. New York time) each day the Exchange is open. The
Portfolio's securities and other assets are valued as follows: securities listed
or traded primarily on foreign exchanges, national exchanges and the NASDAQ
Stock market are valued at the last sale price on such markets, or, if such a
price is lacking for the trading period immediately preceding the time of
determination, such securities are valued at the mean of their current bid and
asked prices. Securities that are traded in the over-the-counter market are
valued at the mean between their current bid and asked prices. The market value
of individual securities held by the Portfolio are determined by using pricing
services which provide market prices to other mutual funds or, as needed, by
obtaining market quotations from independent broker/dealers. Short-term money
market securities maturing within 60 days are valued on the amortized cost
basis, which approximates market value. Securities and assets for which
quotations are not readily available are valued at fair values determined in
good faith pursuant to consistently applied procedures established by the
trustees.
Generally, trading in foreign securities markets is substantially completed each
day at various times prior to the close of the Exchange. The values of foreign
securities used in computing the net asset value of the shares in the Portfolio
are determined as of the earlier of such market close or the closing time of the
Exchange. Occasionally, events affecting the value of such securities may occur
between the times at which they are determined and the close of the Exchange, or
when the foreign market on which such securities trade is closed but the
Exchange is open, which will not be reflected in the computation of net asset
value. If during such periods, events occur that materially affect the value of
such securities, the securities will be valued at their fair market value as
determined in good faith pursuant to consistently applied procedures established
by the trustees.
FOREIGN CURRENCY TRANSLATION
Assets and liabilities initially expressed in terms of foreign currencies are
translated into U.S. dollars at the prevailing market rates as quoted by one or
more banks or dealers on the date of valuation. The cost of securities is
translated into U.S. dollars at the rates of exchange prevailing when such
securities were acquired. Income and expenses are translated into U.S. dollars
at rates of exchange prevailing when accrued.
FEDERAL INCOME TAXES
The Portfolio is considered a partnership for federal income tax purposes. As
such, each investor in the Portfolio will be taxed on its share of the
Portfolio's ordinary income and capital gains. It is intended that the
Portfolio's assets will be managed in such a way that an investor in the
Portfolio will be able to satisfy the requirements of Sub-Chapter M of the
Internal Revenue Code.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for on the trade date. Gains and losses
are computed on the identified cost basis for both financial statement and
Federal income tax purposes for all securities. Dividend income is recorded on
the ex-dividend date, except if the ex-dividend date has passed, certain
dividends from foreign securities are recorded as soon as the Portfolio is
informed of the ex-dividend date. Dividend income is recorded net of foreign
taxes withheld where recovery of
67
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
NOTES TO
FINANCIAL
STATEMENTS
- --------------------------------------------------------------------------------
1 ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- --------------------------------------------------------------------------------
such taxes is not assured. Interest income is recorded on the accrual basis and
includes amortization of discounts and premiums.
USE OF ESTIMATES
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 increases and decreases in net assets from operations
during the reporting period. Actual results may differ from those estimates.
FORWARD CURRENCY CONTRACTS
The Portfolio may enter into forward foreign currency exchange contracts for the
purpose of hedging the Portfolio against exposure to market value fluctuations
in foreign currencies. The use of such instruments may involve risks such as the
possibility of illiquid markets or imperfect correlation between the value of
the contracts and the underlying securities, or that the counterparty will fail
to perform its obligations. Forward currency contracts and foreign denominated
assets may involve more risks than domestic transactions, including currency
risk, political and economic risk, regulatory risk and market risk. Risks may
arise from the potential inability of a counterparty to meet the terms of a
contract and from unanticipated movements in the value of foreign currencies
relative to the U.S. dollar. The forward foreign currency exchange contracts are
adjusted to the daily exchange rate of the underlying currency and any gains or
losses are recorded for financial statement purposes as unrealized gains or
losses until the contract settlement date.
- --------------------------------------------------------------------------------
2 AGREEMENTS
- --------------------------------------------------------------------------------
BBOI renders investment advisory services to the Portfolio pursuant to an
agreement that provides for an investment advisory fee to be paid to BBOI at the
annual rate of .90 of 1% of the Portfolio's average daily net assets. Until at
least April 30, 1998, BBOI has agreed voluntarily to waive its advisory fee to
the extent that the Portfolio's normal operating expenses in any fiscal year
(including the investment advisory fee and custodian fees, but excluding
brokerage commissions, interest, taxes and extraordinary expenses) exceed 1.00%
of the Portfolio's average daily net assets for that fiscal year. BBOI is also
responsible for providing for or arranging for all managerial and administrative
services necessary for the operations of the Portfolio. BBOI has delegated the
daily investment management of the Portfolio to BIAM. For such services, BBOI
pays BIAM a sub-advisory fee equal to .45% of the average daily net assets of
the Portfolio. Such sub-advisory fee has been voluntarily waived by BIAM from
the Commencement of Investment Operations through March 31, 1998, except for an
amount payable on the Citizens NH converted assets (see note 1).
Investors Fiduciary Trust Company ("IFTC") has been appointed to provide record
keeping and pricing services to the Portfolio, including calculating the net
asset value of the Portfolio, and to perform certain accounting and record
keeping functions required by the Portfolio. In addition, IFTC has been
appointed to serve as the Portfolio's custodian and transfer agent. For
custodian, record keeping and pricing services, the Portfolio pays a fee
directly to IFTC based on a percentage of its net assets, subject to certain
minimums, and reimburses IFTC for certain out-of-pocket expenses. IFTC's fees
for custody, record keeping and pricing, or transfer agency services are subject
to reduction by credits earned by the Portfolio, based on the cash balances of
the Portfolio held by IFTC as custodian or by credits received from directed
brokerage transactions. For the six months ended March 31, 1998, the Portfolio
received $73,000 in earnings credits, which offset the fees payable to IFTC for
services rendered.
Certain officers and trustees of the Trust are officers and directors of Berger,
BBOI or BIAM. Trustees who are not affiliated with Berger, BBOI or BIAM are
compensated for their services according to a fee schedule, allocated among the
Berger Funds (which consists of the New Generation Fund, Select Fund, Small
Company Growth Fund, Small Cap Value Fund, Mid Cap Growth Fund, One Hundred
Fund, Growth & Income Fund and Balanced Fund) and the Portfolio, which includes
an annual fee component and a per meeting component. Trustees' fees and expenses
for the six months ended March 31, 1998, totaled $6,000.
68
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
- --------------------------------------------------------------------------------
3 INVESTMENT TRANSACTIONS
- --------------------------------------------------------------------------------
PURCHASES AND SALES
Purchases and sales of investment securities (excluding short-term securities)
during the six-month period ended March 31, 1998, were as follows:
<TABLE>
<CAPTION>
Purchase of Sales of
Investment Investment
Securities Securities
- ----------------------------------
<S> <C>
$ 57,932,386 $ 10,305,328
- ----------------------------------
</TABLE>
There were no purchases or sales of long-term U.S. Government securities during
the period.
At March 31, 1998, the composition of unrealized appreciation (the excess of
value over tax cost) and unrealized depreciation (the excess of tax cost over
value) for securities held was as follows:
<TABLE>
<CAPTION>
Gross Gross
Federal Tax Unrealized Unrealized
Cost Appreciation Depreciation Net
---------------------------------------------------------------
<S> <C> <C> <C>
$155,156,875 $34,253,443 $(8,956,727) $25,296,716
---------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
4 LINE OF CREDIT
- --------------------------------------------------------------------------------
The Portfolio, along with the Berger New Generation Fund, Berger Small Company
Growth Fund, Berger Small Cap Value Fund, Berger One Hundred Fund and Berger
Growth and Income Fund (the "Funds"), are party to an ongoing agreement with
certain banks that allows the Funds and the Portfolio, collectively, to borrow
up to $150 million, subject to certain conditions, for temporary or emergency
purposes. Interest on any borrowings, if any, is charged to the specific fund
executing the borrowing at the Federal Funds Rate plus 75 basis points. In
addition, the unsecured line of credit requires a quarterly payment of a
commitment fee based on the average daily unused portion of the line of credit.
At March 31, 1998, the outstanding balance on the line of credit was $0.
69
<PAGE>
..............................
FINANCIAL
HIGHLIGHTS
------------------------------------
BERGER NEW GENERATION FUND
<TABLE>
<CAPTION>
Years Ended September
Six Months Ended 30,
March 31, 1998 ------------------------
(Unaudited) 1997 1996*
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 14.72 $ 11.82 $ 10.00
- -----------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income (loss) (0.11) (0.13) 0.56
- -----------------------------------------------------------------------------------------------------
Net realized and unrealized gains (losses)
on securities 0.81 3.64 1.26
- -----------------------------------------------------------------------------------------------------
Total from investment operations 0.70 3.51 1.82
- -----------------------------------------------------------------------------------------------------
Less distributions
Dividends (from net investment income) 0.00 (0.61) 0.00
- -----------------------------------------------------------------------------------------------------
Distributions (from capital gains) 0.00 0.00 0.00
- -----------------------------------------------------------------------------------------------------
Total distributions 0.00 (0.61) 0.00
- -----------------------------------------------------------------------------------------------------
Net asset value, end of period $ 15.42 $ 14.72 $ 11.82
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
Total Return (%) 4.76 31.53 18.20
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $143,254 $ 190,164 $ 116,912
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
Net expense ratio to average net assets (%) 1.76(2) 1.87 1.88(2)
- -----------------------------------------------------------------------------------------------------
Ratio of net income (loss) to average net
assets (%) (1.48)(2) (1.51) 12.35(2)
- -----------------------------------------------------------------------------------------------------
Gross expenses to average net assets(1) (%) 1.78(2) 1.89 2.09(2)
- -----------------------------------------------------------------------------------------------------
Portfolio turnover rate (%) 114 184 474(3)
- -----------------------------------------------------------------------------------------------------
Average commission paid $ 0.0600 $ 0.0693 $ 0.0291
- -----------------------------------------------------------------------------------------------------
</TABLE>
* For the period from March 29, 1996 (commencement of investment operations) to
September 30, 1996.
1. During the period, certain fees were reduced as a result of voluntary fee
reductions and/or earning credits. If such earning credits and/or voluntary fee
reductions had not occurred, the ratios would have been as indicated.
2. Annualized.
3. The Fund experienced higher than anticipated turnover during this period as a
result of portfolio transactions undertaken in response to volatile markets and
the short tax year for its initial period of operations.
BERGER SELECT FUND
<TABLE>
<CAPTION>
Period from December 31,
1997*
to March 31, 1998
(Unaudited)
- -----------------------------------------------------------------------------------
<S> <C> <C>
Net asset value, beginning of period $ 10.00
- -----------------------------------------------------------------------------------
Income from investment operations
Net investment income (loss) 0.03
- -----------------------------------------------------------------------------------
Net realized and unrealized gains (losses)
on securities 3.68
- -----------------------------------------------------------------------------------
Total from investment operations 3.71
- -----------------------------------------------------------------------------------
Less distributions
Dividends (from net investment income) 0.00
- -----------------------------------------------------------------------------------
Distributions (from capital gains) 0.00
- -----------------------------------------------------------------------------------
Total distributions 0.00
- -----------------------------------------------------------------------------------
Net asset value, end of period $ 13.71
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Total Return (%) 37.10
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Net assets, end of period (in thousands) $23,393
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Net expense ratio to average net assets (%) 1.56(2)
- -----------------------------------------------------------------------------------
Ratio of net income (loss) to average net
assets (%) 1.26(2)
- -----------------------------------------------------------------------------------
Gross expenses to average net assets(1) (%) 1.59(2)
- -----------------------------------------------------------------------------------
Portfolio turnover rate (%) 875
- -----------------------------------------------------------------------------------
Average commission paid $0.0599
- -----------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
1. During the period, certain fees were reduced as a result of voluntary fee
reductions and/or earning credits. If such earning credits and voluntary fee
reductions had not occurred, the ratios would have been as indicated.
2. Annualized.
3. The Portfolio turnover rate for the period shown is significantly higher than
normally anticipated due to the short time period presented and active trading
undertaken in pursuit of opportunities presented by market conditions or in
response to volatile markets during the initial period of operations when the
Fund's assets were still relatively small and the Fund was not yet fully
invested.
See notes to financial statements.
70
<PAGE>
FINANCIAL HIGHLIGHTS
BERGER SMALL COMPANY GROWTH FUND
<TABLE>
<CAPTION>
Six Months Ended Years Ended September 30,
March 31, 1998 ---------------------------------------------
(Unaudited) 1997 1996 1995 1994*
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 5.33 $ 4.74 $ 3.61 $ 2.74 $ 2.50
- -------------------------------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income (loss) (0.03) (0.05) (0.03) (0.02) 0.00
- -------------------------------------------------------------------------------------------------------------------------
Net realized unrealized gains (losses) on
securities 0.26 0.84 1.16 0.89 0.24
- -------------------------------------------------------------------------------------------------------------------------
Total from investment operations 0.23 0.79 1.13 0.87 0.24
- -------------------------------------------------------------------------------------------------------------------------
Less distributions
Dividends (from net investment income) 0.00 0.00 0.00 0.00(1) 0.00
- -------------------------------------------------------------------------------------------------------------------------
Distributions (from capital gains) (0.48) (0.20) 0.00 0.00 0.00
- -------------------------------------------------------------------------------------------------------------------------
Total distributions (0.48) (0.20) 0.00 0.00 0.00
- -------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 5.08 $ 5.33 $ 4.74 $ 3.61 $ 2.74
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
Total Return (%) 5.97 17.68 31.30 31.90 9.60(4)
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $844,074 $ 902,685 $ 871,467 $ 522,667 $ 211,852
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
Net expense ratio to average net assets (%) 1.44(2) 1.66 1.67 1.87 2.05
- -------------------------------------------------------------------------------------------------------------------------
Ratio of net income (loss) to average net
assets (%) (1.05)(2) (1.09) (0.97) (0.74) 0.32(2)
- -------------------------------------------------------------------------------------------------------------------------
Gross expenses to average net assets(3) (%) 1.46(2) 1.67 1.68 1.89 2.10(2)
- -------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate (%) 40 111 91 109 108
- -------------------------------------------------------------------------------------------------------------------------
Average commission paid $ 0.0601 $ 0.0580 $ 0.0584 -- --
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
* For the period December 30, 1993 (commncement of investment operations) to
September 30, 1994.
1. Dividends from net investment income were less than $.01 per share.
2. Annualized.
3. During the period, certain fees were reduced as a result of voluntary fee
reductions and/or earning credits. If such earning credits and/or voluntary fee
reductions had not occurred, the ratios would have been as indicated.
BERGER SMALL CAP VALUE FUND-INVESTOR SHARES
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998 Period from February 14, 1997*
(Unaudited) to September 30, 1997
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 22.28 $ 17.24
- -------------------------------------------------------------------------------------------------------------
From investment operations
Net investment income (loss) 0.07 0.03
- -------------------------------------------------------------------------------------------------------------
Net realized and unrealized gains (losses)
from investments 1.83 5.01
- -------------------------------------------------------------------------------------------------------------
Total from investment operations 1.90 5.04
- -------------------------------------------------------------------------------------------------------------
Less dividends and distributions
Dividends (from net investment income) (0.17) --
- -------------------------------------------------------------------------------------------------------------
Distributions (from capital gains) (2.37) --
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
Total dividends and distributions (2.54) --
- -------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 21.64 $ 22.28
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
Total Return (%) 9.58 29.23
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net assets at end of period $96,096 $55,211
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
Net expense ratio to average net assets (%) 1.62(1) 1.65(1)
- -------------------------------------------------------------------------------------------------------------
Ratio of net income to average net assets (%) 0.51(1) 0.60(1)
- -------------------------------------------------------------------------------------------------------------
Gross expenses to average net assets(2) (%) 1.63(1) 1.66(1)
- -------------------------------------------------------------------------------------------------------------
Portfolio turnover rate (%) 37 81
- -------------------------------------------------------------------------------------------------------------
Average commission paid $0.0595 $0.0726
- -------------------------------------------------------------------------------------------------------------
</TABLE>
* Commencement of Investor shares.
1. Annualized.
2. During the period certain fees were reduced as a result of voluntary fee
reductions and/or earnings credits. If such earning credits and/or voluntary fee
reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
71
<PAGE>
FINANCIAL HIGHLIGHTS
BERGER SMALL CAP VALUE FUND-INSTITUTIONAL SHARES
<TABLE>
<CAPTION>
Six Months Ended Years Ended December 31,
March 31, 1998 Nine Months Ended -----------------------------------------
(Unaudited) September 30, 1997 1996 1995 1994 1993
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 22.33 $ 16.48 $ 14.57 $ 12.75 $ 13.99 $ 13.39
- ---------------------------------------------------------------------------------------------------------------------------------
From investment operations
Net investment income (loss) 0.10 0.07 0.12 0.09 (0.01) 0.03
- ---------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gains (losses) from
investments 1.83 5.78 3.62 3.23 0.91 2.14
- ---------------------------------------------------------------------------------------------------------------------------------
Total from investment operations 1.93 5.85 3.74 3.32 0.90 2.17
- ---------------------------------------------------------------------------------------------------------------------------------
Less dividends and distributions
Dividends (from net investment
income) (0.23) -- (0.11) (0.09) -- (0.03)
- ---------------------------------------------------------------------------------------------------------------------------------
Distributions (from capital
gains) (2.37) -- (1.72) (1.41) (2.14) (1.54)
- ---------------------------------------------------------------------------------------------------------------------------------
Total dividends and distributions (2.60) -- (1.83) (1.50) (2.14) (1.57)
- ---------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 21.66 $ 22.33 $ 16.48 $ 14.57 $ 12.75 $ 13.99
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
Total Return (%) 9.78 33.50 25.58 26.07 6.74 16.25
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net assets at end of period $83,195 $58,450 $ 36,041 $ 31,833 $ 18,270 $ 16,309
- ---------------------------------------------------------------------------------------------------------------------------------
Net expense ratio to average net
assets (%) 1.21(1) 1.33(1) 1.48 1.64 1.43 1.31
- ---------------------------------------------------------------------------------------------------------------------------------
Ratio of net income to average
net assets (%) 0.97(1) 0.63(1) 0.69 0.64 (0.04) 0.18
- ---------------------------------------------------------------------------------------------------------------------------------
Gross expenses to average net
assets(2) (%) 1.22(1) 1.34(1) 1.48 1.64 1.43 1.31
- ---------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate (%) 37 81 69 90 125 108
- ---------------------------------------------------------------------------------------------------------------------------------
Average commission paid $0.0595 $0.0726 $ 0.1015 $ -- $ -- $ --
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
1. Annualized.
2. During the period certain fees were reduced as a result of voluntary fee
reductions and/or earnings credits. If such earning credits and/or voluntary fee
reductions had not occurred, the ratios would have been as indicated.
BERGER MID CAP GROWTH FUND
<TABLE>
<CAPTION>
Period from December 31, 1997*
to March 31, 1998
(Unaudited)
- ----------------------------------------------------------------------------------
<S> <C> <C>
Net asset value, beginning of period $ 10.00
- ----------------------------------------------------------------------------------
Income from investment operations
Net investment income (loss) (0.01)
- ----------------------------------------------------------------------------------
Net realized and unrealized gains
(losses) on securities 2.61
- ----------------------------------------------------------------------------------
Total from investment operations 2.60
- ----------------------------------------------------------------------------------
Less distributions
Dividends (from net investment income) 0.00
- ----------------------------------------------------------------------------------
Distributions (from capital gains) 0.00
- ----------------------------------------------------------------------------------
Total distributions 0.00
- ----------------------------------------------------------------------------------
Net asset value, end of period $ 12.60
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Total Return (%) 26.00
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 3,343
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Net expense ratio to average net assets (%) 1.99(2)
- ----------------------------------------------------------------------------------
Ratio of net income (loss) to average net
assets (%) (0.29)(2)
- ----------------------------------------------------------------------------------
Gross expenses to average net assets(1) (%) 3.32(2)
- ----------------------------------------------------------------------------------
Portfolio turnover rate (%) 113
- ----------------------------------------------------------------------------------
Average commission paid $ 0.0598
- ----------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
1. During the period, certain fees were reduced as a result of voluntary fee
reductions and/or earning credits. If such earning credits and voluntary fee
reductions had not occurred, the ratios would have been as indicated.
2. Annualized.
See notes to financial statements.
72
<PAGE>
FINANCIAL HIGHLIGHTS
BERGER 100 FUND
<TABLE>
<CAPTION>
Six Months Ended Years Ended September 30,
March 31, 1998* --------------------------------------------------------------
(Unaudited) 1997* 1996* 1995* 1994* 1993*
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 21.51 $ 19.64 $ 18.89 $ 15.96 $ 16.54 $ 11.73
- ----------------------------------------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income (loss) (0.03) (0.09) (0.08) (0.04) (0.12) (0.14)
- ----------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gains (losses)
on securities 1.34 4.73 1.76 2.97 (0.46) 4.95
- ----------------------------------------------------------------------------------------------------------------------------------
Total from investment operations 1.31 4.64 1.68 2.93 (0.58) 4.81
- ----------------------------------------------------------------------------------------------------------------------------------
Less distributions
Dividends (from net investment income) 0.00 0.00 0.00 0.00 0.00 0.00
- ----------------------------------------------------------------------------------------------------------------------------------
Distributions (from capital gains) (6.95) (2.77) (0.93) 0.00 0.00 0.00
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total distributions (6.95) (2.77) (0.93) 0.00 0.00 0.00
- ----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 15.87 $ 21.51 $ 19.64 $ 18.89 $ 15.96 $ 16.54
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return (%) 11.03 26.50 9.36 18.36 (3.51) 41.01
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $1,909,366 $1,889,048 $2,012,706 $2,205,678 $2,228,743 $1,407,849
- ----------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Net expense ratio to average net assets (%) 1.39(1) 1.38 1.40 1.48 1.70 1.69
- ----------------------------------------------------------------------------------------------------------------------------------
Ratio of net income (loss) to average net
assets (%) (0.34)(1) (0.40) (0.43) (0.28) (0.74) (1.00)
- ----------------------------------------------------------------------------------------------------------------------------------
Gross expenses to average net assets(2) (%) 1.41(1) 1.41 1.42 1.49 1.95 1.88
- ----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate (%) 147 200 122 114 64 74
- ----------------------------------------------------------------------------------------------------------------------------------
Average commission paid $ 0.0600 $ 0.0608 $ 0.0624 -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Per share calculations for the period were based on average shares
outstanding.
1. Annualized.
2. During the period, certain fees were reduced as a result of voluntary fee
reductions and/or earning credits. If such earning credits and/or voluntary fee
reductions had not occurred, the ratios would have been as indicated.
BERGER/BIAM INTERNATIONAL FUND
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998 Period from November 7, 1996*
(unaudited) to September 30, 1997
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $ 11.46 $ 10.00
- ---------------------------------------------------------------------------------------------------------
From Investment Operations
Net investment income (loss) (0.01) 0.05
- ---------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) on
investments 0.80 1.41
- ---------------------------------------------------------------------------------------------------------
Total from investment operations 0.79 1.46
- ---------------------------------------------------------------------------------------------------------
Less dividends and distributions
Dividends (from net investment income) (0.06) --
- ---------------------------------------------------------------------------------------------------------
Distributions (from capital gains) (0.38) --
- ---------------------------------------------------------------------------------------------------------
Total dividends and distributions (0.44) --
- ---------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 11.81 $ 11.46
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
Total Return 7.46% 14.60%
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
Net assets at end of period (in thousands) $19,998 $18,673
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net expense ratio to average net assets 1.74%(1) 1.80%(1)
- ---------------------------------------------------------------------------------------------------------
Ratio of net income to average net assets (0.17%)(1) 0.61%(1)
- ---------------------------------------------------------------------------------------------------------
Gross expenses to average net assets(2) 1.93%(1) 1.99%(1)
- ---------------------------------------------------------------------------------------------------------
</TABLE>
* Commencement of investment operations.
1. Annualized.
2. Reflects the Fund's expenses plus the Fund's pro rata share of the
Portfolio's gross expenses. During the period, certain of the Portfolio's
expenses were reduced as a result of voluntary fee reductions and/or earnings
credits. If such earnings credits and/or voluntary fee reductions had not
occurred, the ratios would have been as indicated.
See notes to financial statements.
73
<PAGE>
FINANCIAL HIGHLIGHTS
BERGER GROWTH & INCOME FUND
<TABLE>
<CAPTION>
Six Months Ended Years Ended September 30,
March 31, 1998 ---------------------------------------------------------
(Unaudited) 1997 1996 1995 1994 1993
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 16.72 $ 14.06 $ 12.89 $ 11.48 $ 11.27 $ 8.96
- ------------------------------------------------------------------------------------------------------------------------------
Income from investment operations
Net investment income (loss) 0.01 0.14 0.20 0.16 0.12 0.08
- ------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gains (losses)
on securities 1.01 4.28 1.17 1.43 0.21 2.29
- ------------------------------------------------------------------------------------------------------------------------------
Total from investment operations 1.02 4.42 1.37 1.59 0.33 2.37
- ------------------------------------------------------------------------------------------------------------------------------
Less distributions
Dividends (from net investment income) (0.02) (0.13) (0.20) (0.18) (0.12) (0.06)
- ------------------------------------------------------------------------------------------------------------------------------
Distributions (from capital gains) (2.82) (1.63) 0.00 0.00 0.00 0.00
- ------------------------------------------------------------------------------------------------------------------------------
Total distributions (2.84) (1.76) (0.20) (0.18) (0.12) (0.06)
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 14.90 $ 16.72 $ 14.06 $ 12.89 $ 11.48 $ 11.27
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
Total Return (%) 7.65 34.56 10.66 14.05 2.91 26.48
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $359,898 $ 357,023 $ 315,538 $ 354,396 $ 391,570 $ 112,932
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
Net expense ratio to average net assets (%) 1.45(2) 1.50 1.54 1.63 1.81 2.10
- ------------------------------------------------------------------------------------------------------------------------------
Ratio of net income (loss) to average net
assets (%) 0.17(2) 0.87 1.39 1.33 1.19 1.05
- ------------------------------------------------------------------------------------------------------------------------------
Gross Expenses to average net assets(1) (%) 1.47(2) 1.51 1.56 1.64 2.06 2.29
- ------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate (%) 155 173 112 85 23 62
- ------------------------------------------------------------------------------------------------------------------------------
Average commission paid $ 0.0607 $ 0.0612 $ 0.0613 -- -- --
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
1. During the period, certain fees were reduced as a result of voluntary fee
reductions and/or earning credits. If such earning credits and voluntary fee
reductions had not occurred, the ratios would have been as indicated.
2. Annualized.
BERGER BALANCED FUND
<TABLE>
<CAPTION>
Six Months Ended
March 31, 1998
(Unaudited)
- ----------------------------------------------------------------------
<S> <C> <C>
Net asset value, beginning of period $ 10.00
- ----------------------------------------------------------------------
Income from investment operations
Net investment income (loss) 0.07
- ----------------------------------------------------------------------
Net realized and unrealized gains (losses)
on securities 5.39
- ----------------------------------------------------------------------
Total from investment operations 5.46
- ----------------------------------------------------------------------
Less distributions
Dividends (from net investment income) (0.06)
- ----------------------------------------------------------------------
Distributions (from capital gains) (1.90)
- ----------------------------------------------------------------------
Total distributions (1.96)
- ----------------------------------------------------------------------
Net asset value, end of period $ 13.50
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Total Return 58.10%
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Net assets, end of period (in thousands) $25,603
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Net expense ratio to average net assets 1.46%(2)
- ----------------------------------------------------------------------
Ratio of net income (loss) to average net
assets 2.04%(2)
- ----------------------------------------------------------------------
Gross Expenses to average net assets(1) 1.62%(2)
- ----------------------------------------------------------------------
Portfolio turnover rate 627%(3)
- ----------------------------------------------------------------------
Average Commission Paid $0.0592
- ----------------------------------------------------------------------
</TABLE>
1. During the period, certain fees were reduced as a result of voluntary fee
reductions and/or earning credits. If such earning credits and/or voluntary fee
reductions had not occurred, the ratios would have been as indicated.
2. Annualized.
3. The Portfolio turnover rate for the period shown is significantly higher than
normally anticipated due to the short time period presented and active trading
undertaken in pursuit of opportunities presented by market conditions or in
response to volatile markets during the initial period of operations when the
Fund's assets were still relatively small and the Fund was not yet fully
invested.
See notes to financial statements.
74
<PAGE>
[BERGER LOGO]
THE BERGER FUNDS
210 University Blvd
Denver, CO 80206
Shareholders with questions should write to The Berger Funds, c/o Berger
Associates, Inc., P.O. Box 5005, Denver, CO 80217 or call 1-800-551-5849.
Bulk Rate
U.S. Postage
PAID
Berger Funds
<PAGE>
SEMI-ANNUAL
THE BERGER FUNDS
[PHOTO]
March 31, 1998
BERGER/BIAM INTERNATIONAL CORE FUND
<PAGE>
- --------------------------------------------------------------------------------
BERGER/BIAM
TABLE OF CONTENTS
INTERNATIONAL CORE FUND
<TABLE>
<CAPTION>
BERGER/BIAM INTERNATIONAL CORE FUND
<S> <C>
PORTFOLIO MANAGER'S LETTER......................... 2
STATEMENT OF ASSETS AND LIABILITIES................ 5
STATEMENT OF OPERATIONS............................ 5
STATEMENT OF CHANGES IN NET ASSETS................. 6
NOTES TO FINANCIAL STATEMENTS...................... 7
FINANCIAL HIGHLIGHTS............................... 10
BERGER/BIAM INTERNATIONAL PORTFOLIO
SCHEDULE OF INVESTMENTS............................ 12
STATEMENT OF ASSETS AND LIABILITIES................ 16
STATEMENT OF OPERATIONS............................ 17
STATEMENT OF CHANGES IN NET ASSETS................. 18
NOTES TO FINANCIAL STATEMENTS...................... 19
</TABLE>
1
<PAGE>
- --------------------------------------------------------------------------------
THE BERGER/BIAM
PORTFOLIO MANAGER'S LETTER
INTERNATIONAL CORE FUND
PERFORMANCE
For the six-month period ending March 31, 1998, the Berger/BIAM International
CORE Fund had a total return of 7.78%(1), compared to 5.87% for MSCI EAFE
Index(2).
The primary positive contributors to performance during the period were Growth
in Telecommunications, Healthcare Needs and, to a lesser extent, Positive
Banking Environment.
Stocks in Growth in Telecommunications had the largest positive impact on
portfolio performance. Mannesmann had a stellar first quarter after announcing a
doubling in its cellular network subscribers in 1997. Cable and Wireless did
well following its affiliate's decision (Hong Kong Telecom) to relinquish its
Hong Kong monopoly. The deal removes uncertainty surrounding the stock that had
held the price back in 1997. Vodafone profited from a surge in new mobile phone
customers and positive reaction to news that a consortium, of which it is a
shareholder, was awarded a license to develop a mobile phone network in Egypt.
Stocks in Healthcare Needs also produced strong returns, led by Zeneca, which
had significant increases in profit and sales. After getting off to a fast
start, Glaxo Wellcome fell back on news that its proposed merger with SmithKline
Beecham was aborted.
Although our Positive Banking Environment theme suffered in the latter part of
1997, primarily because of the Asian crisis, there was a solid turnaround in the
first quarter 1998. European financial stocks were the linchpin of a strong
equity market performance. The run up in financial stocks was driven by
prospects for continued economic recovery, low interest rates and investor
expectations of further consolidation in the overbanked European region. Among
portfolio holdings, Banco de Santander was a standout. This Spanish bank
performed in line with expectations in 1997, and its decision to acquire another
Spanish bank was greeted very positively by the market.
Pacific Basin themes continued to disappoint, although these now represent a
small portion of the portfolio. Share prices of Japanese stocks in Technological
Innovation also had a negative impact. We believe these stocks were dragged down
by negative sentiment about the Japanese economy overall. Prices may bounce back
when earnings results are released later this spring.
PERIOD IN REVIEW
Global equity markets had a rocky fourth quarter 1997 as Asian troubles
reverberated around the world. In European markets, share prices of companies
with earnings exposure
2
<PAGE>
BERGER/BIAM INTERNATIONAL CORE FUND
to the Pacific Rim were hit hard. However, 1998 started on a positive note.
Falling interest rates, receding Asian crisis, positive Wall Street background
and surging liquidity combined to drive the markets higher. Affirmation of the
11 likely starters for European Monetary Union next January gave further impetus
to peripheral European markets, with Spain and especially Italy being the star
performers. In the U.K., British fund managers rotated out of industrial and
cyclical stocks that underperformed during 1997 and into financials and
pharmaceuticals.
In Asia, Indonesia's currency went into free fall, declining 50% as concerns
mounted about increasing bad debts, rising unemployment and upcoming
presidential elections. The currency stabilized by March 31 when a more flexible
reform package was agreed to by the IMF. Japan was not immune to Asian problems,
and its market fell during the period. Japan is the biggest foreign investor,
producer and lender in Asia, so it was no surprise that the regional currency
debacle weighed heavily on Japan's already worrisome bad debt crisis.
LOOKING AHEAD
We are cautiously optimistic about international equity market prospects for
the remainder of 1998. The move toward EMU remains on track, and growth
prospects for core Europe are brighter than at the start of the year. In
Germany, domestic demand is slowly recovering, and, for the first time in more
than a year, unemployment is beginning to fall. Significant mergers and
acquisitions are likely in financials, pharmaceuticals and telecoms, which
should support share prices. Because of the high valuation levels in core
Europe, we may take profits in stocks that look stretched from a valuation
perspective. We are seeking opportunities among stocks that have underperformed
for an extended period and that have a catalyst for change visible on the
horizon.
In Asia, attention is likely to remain on the Japanese government as investors
await intervention to stimulate the domestic economy. Unless and until there is
a meaningful move by the government, the Japanese stock market is unlikely to
recover. We believe that, on a company-by-company basis, value can still be
found in Japanese companies that are continuing to grow their earnings. We
remain extremely cautious on the rest of Asia. The region's economies can
recover, but only with the introduction of painful fiscal measures and massive
deregulation.
We thank you for your investment in the Berger/BIAM International CORE Fund.
(1) PERFORMANCE FIGURES ARE BASED ON HISTORICAL RESULTS AND ARE NOT INTENDED
TO 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.
(2) THE MORGAN STANLEY CAPITAL INTERNATIONAL EAFE INDEX REPRESENTS MAJOR
OVERSEAS STOCK MARKETS. IT IS AN UNMANAGED INDEX. ONE CANNOT INVEST
DIRECTLY IN AN INDEX.
3
<PAGE>
BERGER/BIAM INTERNATIONAL CORE FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF
$1,000,000 INVESTMENT IN BERGER/BIAM
INTERNATIONAL CORE FUND VS. EAFE
INDEX + DV AND COST OF LIVING INDEX
INITIAL INVESTMENT $1,000,000
BERGER/BIAM
INTERNATIONAL EAFE INDEX COST OF
CORE FUND LIVING INDEX
VALUE OF SHARES
<S> <C> <C> <C>
7/31/89 $1,000,000 $1,000,000 $1,000,000
3/31/90 $1,268,000 $838,777 $1,034,566
3/31/91 $1,265,000 $862,814 $1,085,209
3/31/92 $1,361,000 $796,278 $1,119,775
3/31/93 $1,561,000 $891,892 $1,154,341
3/31/94 $1,898,000 $1,095,573 $1,183,280
3/31/95 $1,915,000 $1,165,375 $1,217,042
3/31/96 $2,380,000 $1,313,047 $1,251,608
3/31/97 $2,670,812 $1,336,073 $1,286,174
3/31/98 $3,133,718 $1,588,938 $1,303,859
Berger/BIAM International CORE Fund*
Average Annual Total Return
As of March 31, 1998
Life of Fund
1 Year 5 Years (7/31/89)
17.33% 14.96% 14.08%
Past performance is not predictive
of future performance.
</TABLE>
* PERFORMANCE FIGURES ARE HISTORICAL AND DO NOT REPRESENT FUTURE RESULTS.
INVESTMENT RETURNS AND PRINCIPAL VALUE WILL VARY, AND YOU MAY HAVE A LOSS WHEN
YOU SELL SHARES. PERFORMANCE FIGURES ARE HISTORICAL AND, IN PART, REFLECT THE
PERFORMANCE OF A POOL OF ASSETS ADVISED BY BIAM (BANK OF IRELAND ASSET
MANAGEMENT) FOR PERIODS BEFORE THE FUND COMMENCED INVESTMENT OPERATIONS ON
OCTOBER 11, 1996, ADJUSTED TO REFLECT ANY INCREASED EXPENSES ASSOCIATED WITH
OPERATING THE FUND. THE ASSET POOL WAS NOT REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION AND THEREFORE WAS NOT SUBJECT TO THE INVESTMENT
RESTRICTIONS IMPOSED BY LAW ON REGISTERED MUTUAL FUNDS. IF THE POOL HAD BEEN
REGISTERED, ITS PERFORMANCE MIGHT HAVE BEEN ADVERSELY AFFECTED.
4
<PAGE>
BERGER/BIAM INTERNATIONAL CORE FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
MARCH 31,
1998
(UNAUDITED)
<S> <C>
- ----------------------------------------------------------------
ASSETS
Investment in Berger/BIAM International Portfolio
("Portfolio"), at value $158,145,059
- ----------------------------------------------------------------
Total Assets 158,145,059
- ----------------------------------------------------------------
LIABILITIES
Payables
Fund shares redeemed 28,691
Accrued administrative fee 12,822
- ----------------------------------------------------------------
Total Liabilities 41,513
- ----------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $158,103,546
- ----------------------------------------------------------------
- ----------------------------------------------------------------
Capital Shares
Authorized (par value $.01) Unlimited
- ----------------------------------------------------------------
- ----------------------------------------------------------------
Shares outstanding
12,755,880
- ----------------------------------------------------------------
- ----------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER
SHARE
$ 12.39
- ----------------------------------------------------------------
- ----------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED MARCH 31, 1998
<TABLE>
<CAPTION>
<S> <C>
- ----------------------------------------------------------------
NET INVESTMENT INCOME ALLOCATED FROM PORTFOLIO:
Interest and dividends (net of $25,047 foreign
withholding taxes) $ 1,018,758
Portfolio expenses (net of earnings credits and
fee waivers totaling $96,730) (572,937)
- ----------------------------------------------------------------
Net Investment Income Allocated from Portfolio 445,821
- ----------------------------------------------------------------
FUND EXPENSES:
Administrative fees 58,849
- ----------------------------------------------------------------
Total Fund Expenses 58,849
- ----------------------------------------------------------------
Net Investment Income (Loss) 386,972
- ----------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
ALLOCATED FROM PORTFOLIO:
Net realized gain (loss) on investments and
foreign currency transactions (3,652,469)
Net change in unrealized appreciation
(depreciation) on investments and foreign
currency transactions 16,339,456
- ----------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currency Transactions
Allocated from Portfolio 12,686,987
- ----------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations $ 13,073,959
- ----------------------------------------------------------------
- ----------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
5
<PAGE>
BERGER/BIAM INTERNATIONAL CORE FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE PERIOD FROM
MARCH 31, 1998 OCTOBER 11, 1996*
(UNAUDITED) TO SEPTEMBER 30, 1997
<S> <C> <C>
- ----------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income (loss) $ 386,972 $ 699,024
Net realized gain (loss) on investments
and foreign currency transactions (3,652,469) 1,211,171
Net change in unrealized appreciation
(depreciation) on investments and
foreign currency transactions 16,339,456 4,591,326
- ----------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 13,073,959 6,501,521
- ----------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS
Net investment income (729,568) --
Net realized gains on investments (796,911) --
- ----------------------------------------------------------------------------------
Net Decrease in Net Assets from
Dividends and Distributions to
Shareholders (1,526,479) --
- ----------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 54,530,570 94,285,102
Issued in reinvestment of dividends 1,271,755 --
Payments for shares redeemed (6,422,978) (3,609,904)
- ----------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Derived from Fund Share Transactions 49,379,347 90,675,198
- ----------------------------------------------------------------------------------
Increase (Decrease) in Net Assets 60,926,827 97,176,719
NET ASSETS
Beginning of period 97,176,719 --
- ----------------------------------------------------------------------------------
End of Period $ 158,103,546 $ 97,176,719
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
Capital (par value and paid in surplus) $ 140,054,545 $ 90,675,198
Undistributed net investment income
(loss) 356,428 699,024
Undistributed net realized gain (loss)
on investments and foreign currency
transactions (3,238,209) 1,211,171
Net unrealized appreciation
(depreciation) on investments and
foreign currency transactions 20,930,782 4,591,326
- ----------------------------------------------------------------------------------
Net Assets $ 158,103,546 $ 97,176,719
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
TRANSACTIONS IN FUND SHARES
Shares sold 4,882,900 8,647,739
Shares issued to shareholders in
reinvestment of distributions 118,051 --
Shares repurchased (570,655) (322,155)
- ----------------------------------------------------------------------------------
Net Increase (Decrease) in Shares 4,430,296 8,325,584
Shares outstanding, beginning of period 8,325,584 --
- ----------------------------------------------------------------------------------
Shares outstanding, end of period 12,755,880 8,325,584
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
SEE NOTES TO FINANCIAL STATEMENTS.
6
<PAGE>
BERGER/BIAM INTERNATIONAL CORE FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1998 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
The Berger/BIAM International CORE Fund (the "Fund") is a series of the
Berger/ BIAM Worldwide Funds Trust (the "Trust"), a Delaware business trust,
organized on May 31, 1996. The Trust is registered under the Investment Company
Act of 1940, as amended, as an open-end management investment company. The Trust
is authorized to issue an unlimited number of shares of beneficial interest in
series or portfolios. Currently, the series comprising the Fund, Berger/BIAM
International Fund and International Equity Fund, are the only series
established under the Trust, although others may be added in the future. The
Trust is also authorized to establish multiple classes of shares representing
differing interests in an existing or new series. The Fund commenced investment
operations on October 11, 1996 ("Commencement of Investment Operations").
The investment objective of the Fund is long-term capital appreciation. The
Fund will invest all of its investable assets in the Berger/BIAM International
Portfolio (the "Portfolio"), a series of Berger/BIAM Worldwide Portfolios Trust.
The value of such investment reflects the Fund's proportionate interest in the
net assets of the Portfolio (86% at March 31, 1998). The Portfolio is an
open-end management investment company and has the same investment objective and
policies as the Fund. The performance of the Fund will be derived from the
investment performance of the Portfolio. The financial statements of the
Portfolio, including the schedule of investments, are included elsewhere in this
report and should be read in conjunction with the Fund's financial statements.
All costs in organizing the Trust were paid by BBOI Worldwide LLC, the
investment advisor of the Portfolio (the "Advisor"). The Advisor has delegated
the daily portfolio management of the Portfolio to Bank of Ireland Asset
Management (U.S.) Limited ("BIAM" or the "Sub-Advisor"), which owns 50% of the
Advisor. Berger Associates, Inc. ("Berger") also owns 50% of the Advisor.
SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATION
Since the Fund will invest all of its investable assets in the Portfolio, the
value of the Fund's investable assets will be equal to the value of its
beneficial interest in the Portfolio. Valuation of securities by the Portfolio
is discussed in Note 1 of the Portfolio's Notes to Financial Statements which
accompany these Financial Statements for the Fund.
7
<PAGE>
BERGER/BIAM INTERNATIONAL CORE FUND
CALCULATION OF NET ASSET VALUE
The per share calculation of net asset value is determined by dividing the
total value of the Fund's assets, less liabilities, by the total number of
shares outstanding.
INCOME AND EXPENSES
As an investor in the Portfolio, the Fund is allocated its pro rata share of
the aggregate investment income, net realized and unrealized gains or losses and
annual operating expenses (including the investment advisory fee, custodian
fees, independent accountants' fees, record keeping and pricing agent fees) of
the Portfolio. Income and expenses are allocated on the day the income is earned
or the expense is incurred in proportion to the prior day's relative net assets
of the Fund compared to the other investors in the Portfolio. Expenses directly
attributable to the Fund are charged to the Fund.
FEDERAL INCOME TAXES
Each series of the Trust is treated as a separate entity for Federal income
tax purposes. The Fund's policy is to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to shareholders. Therefore, no income tax
provision is required.
DIVIDENDS AND DISTRIBUTIONS
Dividends paid by the Fund from net investment income and distributions of
net realized short-term capital gains are, for Federal income tax purposes,
taxable as ordinary income to shareholders.
The Fund distributes net realized capital gains, if any, to its shareholders
at least annually, if not offset by capital loss carryovers. Income
distributions and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to the differing treatments for
net operating losses and expiring capital loss carryforwards. Accordingly, these
permanent differences in the character of income and distributions between
financial statements and tax basis will be reclassified to paid-in-capital.
USE OF ESTIMATES
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 increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those estimates.
2. AGREEMENTS
Under an Administrative Services Agreement with the Fund, the Advisor serves
as the administrator of the Fund. Pursuant to such Agreement, the Fund pays the
Advisor
8
<PAGE>
BERGER/BIAM INTERNATIONAL CORE FUND
a fee at an annual rate equal to the lesser of 0.10% of its average daily net
assets or the Advisor's annual cost to provide or procure such services plus
0.01% of the Fund's average daily net assets. Under the Agreement, the Advisor
is responsible, at its own expense, for providing or procuring all
administrative services reasonably necessary for the operation of the Fund,
including recordkeeping and pricing services, custodian services, transfer
agency and dividend disbursing services, tax and audit services, insurance,
legal services, printing and mailing to shareholders of prospectuses and other
required communication and certain other administrative services. The Advisor
has delegated the administration of the Fund to Berger. For such services, the
Advisor pays Berger a sub-administration fee equal to 0.25% of the Fund's
average daily net assets. Berger has voluntarily waived such sub-administration
fee from the Commencement of Investment Operations through March 31, 1998.
Investors Fiduciary Trust Company ("IFTC") has been appointed to provide
recordkeeping and pricing services to the Fund, including calculating the net
asset value of the Fund, and to perform certain accounting and recordkeeping
functions that it requires. In addition, IFTC has been appointed to serve as the
Fund's custodian, transfer agent and dividend disbursing agent.
Certain officers and trustees of the Trust are officers and directors of
Berger, the Advisor or BIAM. Trustees who are not affiliated with the
Portfolio's Advisor or Sub-Advisor are compensated for their services according
to a fee schedule, allocated among all of the Berger Funds and the Portfolio,
which includes an annual fee component and a per meeting component. Such fees
are allocated directly to the Portfolio and, therefore, indirectly to the Fund.
9
<PAGE>
BERGER/BIAM INTERNATIONAL CORE FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS PRESENTED
<TABLE>
<CAPTION>
SIX MONTHS ENDED PERIOD FROM
MARCH 31, 1998 OCTOBER 11, 1996* TO
(UNAUDITED) SEPTEMBER 30, 1997
<S> <C> <C>
- ----------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 11.67 $ 10.00
- ----------------------------------------------------------------------------------------------------------
From Investment Operations
Net investment income (loss) 0.02 0.08
Net realized and unrealized gain (loss) on investments 0.86 1.59
- ----------------------------------------------------------------------------------------------------------
Total from investment operations 0.88 1.67
- ----------------------------------------------------------------------------------------------------------
Less dividends and distributions
Dividends (from net investment income) (0.08) --
Distributions (from capital gains) (0.08) --
- ----------------------------------------------------------------------------------------------------------
Total dividends and distributions (0.16) --
- ----------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $ 12.39 $ 11.67
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
Total Return 7.78% 16.70%
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net assets at end of period (in thousands) $ 158,104 $ 97,177
Net expense ratio to average net assets 1.07%(a) 0.98%(a)
Ratio of net income to average net assets 0.66%(a) 1.62%(a)
Gross expenses to average net assets (b) 1.24%(a) 1.20%(a)
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
(A) ANNUALIZED.
(B) REFLECTS THE FUND'S EXPENSES PLUS THE FUND'S PRO RATA SHARE OF THE
PORTFOLIO'S GROSS EXPENSES. DURING THE PERIOD, CERTAIN OF THE PORTFOLIO'S
EXPENSES WERE REDUCED AS A RESULT OF VOLUNTARY FEE REDUCTIONS AND/OR
EARNINGS CREDITS. IF SUCH EARNINGS CREDITS AND/OR VOLUNTARY FEE REDUCTIONS
HAD NOT OCCURRED, THE RATIOS WOULD HAVE BEEN AS INDICATED.
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE>
BERGER/BIAM
INTERNATIONAL PORTFOLIO
SEMI - ANNUAL REPORT
The following pages should be read in conjunction
with the Berger/BIAM International CORE Fund
Semi - Annual Report.
11
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
SCHEDULE OF INVESTMENTS (UNAUDITED)
MARCH 31, 1998
<TABLE>
<CAPTION>
COUNTRY/
SHARES/
PRINCIPAL
AMOUNT COMPANY INDUSTRY VALUE
- ----------- --------------------------------------------- --------------------------------------------- -------------
<C> <S> <C> <C>
COMMON STOCK - 93.31%
AUSTRALIA - 4.91%
260,200 National Australia Bank Commercial Banks & Other Banks $ 3,706,548
573,400 News Corporation Media 3,785,949
428,750 Telstra Corporation Utilities 1,104,525
135,150 Western Mining Mining, Metals & Minerals 463,625
-------------
9,060,647
-------------
CANADA - 0.52%
16,300 Royal Bank Of Canada Commercial Banks & Other Banks 966,525
-------------
DENMARK - 0.37%
7,450 Tele Danmark As-b Utilities 676,945
-------------
FRANCE - 2.91%
690 AXA-UAP Insurance Multi/Property/ Casualty 71,146
4,405 Generale Des Eaux Diversified Holding Companies 716,190
30,455 Michelin B Auto Components 1,820,655
22,970 Total Co. Francaise Petrole 'B' Oil 2,761,968
-------------
5,369,959
-------------
GERMANY - 8.32%
970 Bayerische Motoren Werke Automobiles 1,073,723
12,400 Bayerische Vereinsbank Commercial Banks & Other Banks 906,113
46,845 Hoechst Ag Chemicals 1,837,083
7,640 Mannesmann Ag Machinery & Engineering Services 5,599,372
29,790 Siemens Ag Electrical Equipment 1,996,266
38,631 Veba Ag Diversified Industrials 2,743,450
2,177 Viag Ag Utilities 1,187,808
-------------
15,343,815
-------------
GREAT BRITAIN - 30.62%
185,150 Barclays PLC Commercial Banks & Other Banks 5,548,774
522,890 BAT Industries Beverage Industry/Tobacco Manufacturing 5,331,481
183,200 Cable & Wireless Utilities 2,292,751
127,200 Cadbury Schweppes Beverage Industry/Tobacco Manufacturing 1,765,476
</TABLE>
12
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
<TABLE>
<CAPTION>
COUNTRY/
SHARES/
PRINCIPAL
AMOUNT COMPANY INDUSTRY VALUE
- ----------- --------------------------------------------- --------------------------------------------- -------------
<C> <S> <C> <C>
COMMON STOCK - CONTINUED
220,300 Diageo PLC Beverage Industry/Tobacco Manufacturing $ 2,592,928
149,700 Glaxo Wellcome PLC Health & Personal Care 4,027,708
217,650 Granada Group Entertainment/Leisure/Toys 3,913,661
85,514 Kingfisher PLC Retail Trade 1,602,092
316,400 Ladbroke Group Entertainment/Leisure/Toys 1,770,631
262,200 Lloyds TSB Group Commercial Banks & Other Banks 4,078,201
95,800 Premier Farnell Wholesale Trade 615,107
297,640 Prudential Corporation Insurance Life & Agents/Brokers 4,375,282
226,450 Safeway PLC Retail Trade 1,404,691
66,500 Scottish Power Utilities 625,717
463,880 Shell Transportation & Trading Corporation Oil 3,409,498
145,391 Siebe PLC Machinery & Engineering Services 3,171,774
213,300 TI Group PLC Machinery & Engineering Services 1,871,295
364,600 Vodafone Group Utilities 3,815,197
99,330 Zeneca Group Health & Personal Care 4,280,645
-------------
56,492,909
-------------
HONG KONG - 1.17%
70,400 HSBC Holdings Commercial Banks & Other Banks 2,153,238
-------------
INDONESIA - 0.25%
212,000 Gudang Garam Beverage Industry/Tobacco Manufacturing 293,491
180,000 HM Sampoerna Beverage Industry/Tobacco Manufacturing 163,352
-------------
456,843
-------------
IRELAND - 0.40%
257,100 Smurfit (Jefferson) Group Forestry & Paper Products 737,611
-------------
ITALY - 1.83%
69,006 Eni Spa Itl Oil 470,650
368,030 Telecom Italia Utilities 2,903,213
-------------
3,373,863
-------------
JAPAN - 13.18%
199,000 Canon Inc Computer/Commercial/Office Equipment 4,497,766
</TABLE>
13
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
<TABLE>
<CAPTION>
COUNTRY/
SHARES/
PRINCIPAL
AMOUNT COMPANY INDUSTRY VALUE
- ----------- --------------------------------------------- --------------------------------------------- -------------
<C> <S> <C> <C>
COMMON STOCK - CONTINUED
87,000 Dai Nippon Printing Media $ 1,437,206
107,000 Honda Motor Automobiles 3,856,579
106,000 Kao Corporation Food & Grocery 1,392,904
9,400 Keyence Corporation Electronics & Instruments 1,298,742
42,000 Murata Manufacturing Co Electronics & Instruments 1,160,578
17,000 Rohm Company Limited Electronics & Instruments 1,557,349
101,000 Shiseido Corporation Health & Personal Care 1,160,352
53,200 Sony Corporation Household Durables & Appliances 4,514,060
135,000 Takeda Chemical Health & Personal Care 3,436,455
-------------
24,311,991
-------------
MALAYSIA - 0.30%
103,000 Hume Industries Construction & Building Materials 111,442
403,400 Sime Darby Diversified Holding Companies 449,691
-------------
561,133
-------------
MEXICO - 0.42%
301,770 Grupo Financiero Banamex Commercial Banks & Other Banks 768,277
-------------
NETHERLANDS - 8.72%
76,280 ABN-Amro Holdings Commercial Banks & Other Banks 1,762,068
105,150 Elsevier Media 1,732,090
119,807 ING Groep N.V. Insurance - Multi/Property/ Casualty 6,806,660
52,790 Koninklijke PTT Utilities 2,738,057
31,300 Nutricia Food Manufacturing 1,125,883
33,800 Royal Dutch Petroleum Oil 1,915,428
-------------
16,080,186
-------------
PHILIPPINES - 0.24%
254,370 San Miguel Corporation Class-B Beverage Industry/Tobacco Manufacturing 443,375
-------------
PORTUGAL - 0.25%
19,950 Electricidade De Portugal Utilities 463,426
-------------
SINGAPORE - 3.03%
285,000 City Development Real Estate 1,403,375
233,412 Development Bank of Singapore Commercial Banks & Other Banks 1,705,953
</TABLE>
14
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
<TABLE>
<CAPTION>
COUNTRY/
SHARES/
PRINCIPAL
AMOUNT COMPANY INDUSTRY VALUE
- ----------- --------------------------------------------- --------------------------------------------- -------------
<C> <S> <C> <C>
COMMON STOCK - CONTINUED
174,600 Fraser And Neave Beverage Industry/Tobacco Manufacturing $ 740,792
151,972 Singapore Press Holdings Media 1,741,390
-------------
5,591,510
-------------
SPAIN - 1.67%
61,680 Banco de Santander Commercial Banks & Other Banks 3,075,936
-------------
SWITZERLAND - 14.20%
1,675 Alusuisse Lonza Holdings Fabricated Metal Products 2,035,370
2,634 Nestle Sa Food & Grocery Products 5,039,799
4,609 Novartis Ag-RE Health & Personal Care 8,167,809
269 Roche Holding Health & Personal Care 2,915,366
2,680 Schw Ruckverischer Insurance - Multi/Property/ Casualty 5,895,313
1,315 Union Bank of Switzerland Insurance - Multi/Property/ Casualty 2,150,745
-------------
26,204,402
-------------
TOTAL COMMON STOCK (Cost $146,828,511) 172,132,591
-------------
REPURCHASE AGREEMENT - 4.51%
$ 8,321,000 State Street Bank Repurchase Agreement, 5.70% dated March 31, 1998, to be repurchased at
$8,322,317 on April 1, 1998, collateralized by U.S. Treasury Bond, 6.75% - June 25, 2005,
with a value of $8,491,700 (cost $8,321,000)
8,321,000
-------------
TOTAL REPURCHASE AGREEMENT (Cost $8,321,000) 8,321,000
-------------
Total Investments (cost $155,149,511) - 97.82% 180,453,591
Other assets, less liabilities - 2.18% 4,028,788
-------------
Net Assets - 100.00% $184,482,379
-------------
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
MARCH 31, 1998
(UNAUDITED)
<S> <C>
- ----------------------------------------------------------------------------------
ASSETS
Investments, at cost $ 155,149,511
- ----------------------------------------------------------------------------------
Investments, at value $ 180,453,591
Cash 4,432,884
Foreign cash (cost $1,476,766) 1,487,906
Receivables
Investment securities sold 611,994
Contributions 354,601
Dividends 754,306
Interest 1,317
Foreign currency contracts 709,740
- ----------------------------------------------------------------------------------
Total Assets 188,806,339
- ----------------------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 4,136,263
Withdrawals 40,012
Accrued investment advisory fees 135,470
Accrued audit fees 12,215
- ----------------------------------------------------------------------------------
Total Liabilities 4,323,960
- ----------------------------------------------------------------------------------
NET ASSETS REPRESENTED BY: PAID-IN CAPITAL FOR
BENEFICIAL INTERESTS $ 184,482,379
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX
MONTHS ENDED
MARCH 31, 1998
(UNAUDITED)
<S> <C>
- -------------------------------------------------------------------
INVESTMENT INCOME
Income
Dividends (net of $52,815 foreign tax withheld) $ 997,728
Interest 153,741
- -------------------------------------------------------------------
Total Income 1,151,469
- -------------------------------------------------------------------
Expenses
Investment advisory fees 636,279
Accounting fees 20,846
Custodian fees 52,170
Audit fees 30,216
Legal fees 5,192
Directors'/Trustees' fees and expenses 5,945
Reports to shareholders 3,151
Other expenses 5,795
- -------------------------------------------------------------------
Total Expenses 759,594
Less fees waived by advisor (46,645)
Less earnings credits (73,015)
- -------------------------------------------------------------------
Total Expenses, Net 639,934
- -------------------------------------------------------------------
Net investment income (loss) 511,535
- -------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) on securities and
foreign currency transactions (4,371,369)
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions 18,736,707
- -------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currency Transactions 14,365,338
- -------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations $ 14,876,873
- -------------------------------------------------------------------
- -------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS PERIOD FROM
ENDED OCTOBER 11, 1996*
MARCH 31, 1998 TO
(UNAUDITED) SEPTEMBER 30, 1997
<S> <C> <C>
- -------------------------------------------------------------------------------------------------------
OPERATIONS:
Net investment income (loss) $ 511,535 $ 1,018,078
Net realized gain (loss) on securities and foreign currency
transactions (4,371,369) 1,712,223
Net change in unrealized appreciation (depreciation) on
securities and foreign currency transactions 18,736,707 6,712,560
- -------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting from
Operations 14,876,873 9,442,861
- -------------------------------------------------------------------------------------------------------
FROM TRANSACTIONS IN INVESTORS' BENEFICIAL INTEREST
Contributions 63,796,915 127,144,416
Withdrawals (16,408,409) (14,370,277)
- -------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets From Investors'
Transactions 47,388,506 112,774,139
- -------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 62,265,379 122,217,000
- -------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 122,217,000 0
- -------------------------------------------------------------------------------------------------------
End of period $ 184,482,379 $ 122,217,000
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $ 160,162,645 $ 112,774,139
Undistributed net investment income (loss) 1,529,613 1,018,078
Undistributed net realized gain (loss) from investments (2,659,146) 1,712,223
Net unrealized appreciation (depreciation) of securities and
foreign currency transactions 25,449,267 6,712,560
- -------------------------------------------------------------------------------------------------------
Total $ 184,482,379 $ 122,217,000
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTARY DATA
Net assets, end of period (in thousands) $ 184,482 $ 122,217
Net expense ratio to average net assets 0.90%(1) 0.89%(1)
Ratio of net income (loss) to average net assets 0.72%(1) 1.63%(1)
Gross expenses to average net assets(2) 1.07%(1) 1.10%(1)
Portfolio turnover rate 8% 17%
Average Commission Paid $ 0.0213 $ 0.0248
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
1. ANNUALIZED.
2. DURING THE PERIOD, CERTAIN FEES WERE REDUCED AS A RESULT OF VOLUNTARY FEE
REDUCTIONS AND/OR EARNING CREDITS. IF SUCH EARNING CREDITS AND/OR VOLUNTARY
FEE REDUCTIONS HAD NOT OCCURRED, THE RATIOS WOULD HAVE BEEN AS INDICATED.
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
MARCH 31, 1998
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
The Berger/BIAM International Portfolio (the "Portfolio") is registered under
the Investment Company Act of 1940, as amended, as an open-end management
investment company. The Portfolio is a series of the Berger/BIAM Worldwide
Portfolios Trust (the "Trust"), which was organized as a Delaware business trust
on May 31, 1996. All costs in organizing the Trust were paid by BBOI Worldwide
LLC ("BBOI"), the investment advisor of the Portfolio. The Portfolio commenced
investment operations on October 11, 1996, ("Commencement of Investment
Operations") with the sale of 448,161 shares of beneficial interest to the
International Equity Fund, formerly known as the Berger/BIAM International
Institutional Fund, in exchange for portfolio assets with an aggregate value of
$4,481,609, which were transferred from the Pooled Trust of Citizens Bank of New
Hampshire ("Citizens NH") to the International Equity Fund and, in turn,
transferred to the Portfolio. Such transaction was a tax-free exchange. Citizens
NH is an affiliate of Bank of Ireland Asset Management (U.S.) Limited ("BIAM"),
which was the investment sub-advisor to the Pooled Trust and is the investment
sub-advisor to the Portfolio. Currently there are three investors in the
Portfolio, the Berger/BIAM International Fund, the International Equity Fund and
the Berger/BIAM International CORE Fund.
The investment objective of the Portfolio is long-term capital appreciation.
The Portfolio invests primarily in common stocks of well-established companies
located outside the United States.
The Portfolio is advised by BBOI, which has delegated daily portfolio
management of the Portfolio to BIAM. Berger Associates, Inc. ("Berger") and BIAM
each own 50% of BBOI.
SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Portfolio in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATION
The Portfolio's securities and other assets are valued at the close of the
regular trading session of the New York Stock Exchange (the "Exchange")
(normally 4:00 p.m. New York time) each day the Exchange is open. The
Portfolio's securities and other assets are valued as follows: securities listed
or traded primarily on foreign exchanges, national exchanges and the NASDAQ
Stock market are valued at the last sale price on such markets, or, if such a
price is lacking for the trading period immediately preceding the time of
determination, such securities are valued at the mean of their current bid
19
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
and asked prices. Securities that are traded in the over-the-counter market are
valued at the mean between their current bid and asked prices. The market value
of individual securities held by the Portfolio are determined by using pricing
services which provide market prices to other mutual funds or, as needed, by
obtaining market quotations from independent broker/dealers. Short-term money
market securities maturing within 60 days are valued on the amortized cost
basis, which approximates market value. Securities and assets for which
quotations are not readily available are valued at fair values determined in
good faith pursuant to consistently applied procedures established by the
trustees.
Generally, trading in foreign securities markets is substantially completed
each day at various times prior to the close of the Exchange. The values of
foreign securities used in computing the net asset value of the shares in the
Portfolio are determined as of the earlier of such market close or the closing
time of the Exchange. Occasionally, events affecting the value of such
securities may occur between the times at which they are determined and the
close of the Exchange, or when the foreign market on which such securities trade
is closed but the Exchange is open, which will not be reflected in the
computation of net asset value. If during such periods, events occur that
materially affect the value of such securities, the securities will be valued at
their fair market value as determined in good faith pursuant to consistently
applied procedures established by the trustees.
FOREIGN CURRENCY TRANSLATION
Assets and liabilities initially expressed in terms of foreign currencies are
translated into U.S. dollars at the prevailing market rates as quoted by one or
more banks or dealers on the date of valuation. The cost of securities is
translated into U.S. dollars at the rates of exchange prevailing when such
securities were acquired. Income and expenses are translated into U.S. dollars
at rates of exchange prevailing when accrued.
FEDERAL INCOME TAXES
The Portfolio is considered a partnership for federal income tax purposes. As
such, each investor in the Portfolio will be taxed on its share of the
Portfolio's ordinary income and capital gains. It is intended that the
Portfolio's assets will be managed in such a way that an investor in the
Portfolio will be able to satisfy the requirements of Sub-Chapter M of the
Internal Revenue Code.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for on the trade date. Gains and losses
are computed on the identified cost basis for both financial statement and
Federal income tax purposes for all securities. Dividend income is recorded on
the ex-dividend date, except if the ex-dividend date has passed, certain
dividends from foreign securities are recorded as soon as the Portfolio is
informed of the ex-dividend date. Dividend income
20
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
is recorded net of foreign taxes withheld where recovery of such taxes is not
assured. Interest income is recorded on the accrual basis and includes
amortization of discounts and premiums.
USE OF ESTIMATES
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 increases and decreases in net assets from operations
during the reporting period. Actual results may differ from those estimates.
FORWARD CURRENCY CONTRACTS
The Portfolio may enter into forward foreign currency exchange contracts for
the purpose of hedging the Portfolio against exposure to market value
fluctuations in foreign currencies. The use of such instruments may involve
risks such as the possibility of illiquid markets or imperfect correlation
between the value of the contracts and the underlying securities, or that the
counterparty will fail to perform its obligations. Forward currency contracts
and foreign denominated assets may involve more risks than domestic
transactions, including currency risk, political and economic risk, regulatory
risk and market risk. Risks may arise from the potential inability of a
counterparty to meet the terms of a contract and from unanticipated movements in
the value of foreign currencies relative to the U.S. dollar. The forward foreign
currency exchange contracts are adjusted to the daily exchange rate of the
underlying currency and any gains or losses are recorded for financial statement
purposes as unrealized gains or losses until the contract settlement date.
2. AGREEMENTS
BBOI renders investment advisory services to the Portfolio pursuant to an
agreement that provides for an investment advisory fee to be paid to BBOI at the
annual rate of .90 of 1% of the Portfolio's average daily net assets. Until at
least April 30, 1998, BBOI has agreed voluntarily to waive its advisory fee to
the extent that the Portfolio's normal operating expenses in any fiscal year
(including the investment advisory fee and custodian fees, but excluding
brokerage commissions, interest, taxes and extraordinary expenses) exceed 1.00%
of the Portfolio's average daily net assets for that fiscal year. BBOI is also
responsible for providing for or arranging for all managerial and administrative
services necessary for the operations of the Portfolio. BBOI has delegated the
daily investment management of the Portfolio to BIAM. For such services, BBOI
pays BIAM a sub-advisory fee equal to .45% of the average daily net assets of
the Portfolio. Such sub-advisory fee has been voluntarily waived by BIAM from
the Commencement of Investment Operations through March 31, 1998, except for an
amount payable on the Citizens NH converted assets (see note 1).
21
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
Investors Fiduciary Trust Company ("IFTC") has been appointed to provide
record keeping and pricing services to the Portfolio, including calculating the
net asset value of the Portfolio, and to perform certain accounting and record
keeping functions required by the Portfolio. In addition, IFTC has been
appointed to serve as the Portfolio's custodian and transfer agent. For
custodian, record keeping and pricing services, the Portfolio pays a fee
directly to IFTC based on a percentage of its net assets, subject to certain
minimums, and reimburses IFTC for certain out-of-pocket expenses. IFTC's fees
for custody, recordkeeping and pricing, or transfer agency services are subject
to reduction by credits earned by the Portfolio, based on the cash balances of
the Portfolio held by IFTC as custodian or by credits received from directed
brokerage transactions. For the six months ended March 31, 1998, the Portfolio
received $73,000 in earnings credits, which offset the fees payable to IFTC for
services rendered.
Certain officers and trustees of the Trust are officers and directors of
Berger, BBOI or BIAM. Trustees who are not affiliated with Berger, BBOI or BIAM
are compensated for their services according to a fee schedule, allocated among
the Berger Funds (which consists of the New Generation Fund, Select Fund, Small
Company Growth Fund, Small Cap Value Fund, Mid Cap Growth Fund, One Hundred
Fund, Growth & Income Fund and Balanced Fund) and the Portfolio, which includes
an annual fee component and a per meeting component. Trustees' fees and expenses
for the six months ended March 31, 1998, totaled $6,000.
3. INVESTMENT TRANSACTIONS
PURCHASES AND SALES
Purchases and sales of investment securities (excluding short-term
securities) during the six-month period ended March 31, 1998, were as follows:
<TABLE>
<CAPTION>
Purchase of Sales of
Investment Investment
Securities Securities
- ------------------ ------------------
<S> <C>
$ 57,932,386 $ 10,305,328
</TABLE>
There were no purchases or sales of long-term U.S. Government securities
during the period.
At March 31, 1998, the composition of unrealized appreciation (the excess of
value over tax cost) and unrealized depreciation (the excess of tax cost over
value) for securities held was as follows:
<TABLE>
<CAPTION>
Gross Gross
Federal Tax Unrealized Unrealized
Cost Appreciation Depreciation Net
- -------------- ----------- ----------- -----------
<S> <C> <C> <C>
$155,156,875 $34,253,443 ($8,956,727) $25,296,716
</TABLE>
22
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
4. LINE OF CREDIT
The Portfolio, along with the Berger New Generation Fund, Berger Small
Company Growth Fund, Berger Small Cap Value Fund, Berger One Hundred Fund and
Berger Growth and Income Fund (the "Funds"), are party to an ongoing agreement
with certain banks that allows the Funds and the Portfolio, collectively, to
borrow up to $150 million, subject to certain conditions, for temporary or
emergency purposes. Interest on any borrowings, if any, is charged to the
specific fund executing the borrowing at the Federal Funds Rate plus 75 basis
points. In addition, the unsecured line of credit requires a quarterly payment
of a commitment fee based on the average daily unused portion of the line of
credit. At March 31, 1998, the outstanding balance on the line of credit was $0.
23
<PAGE>
[PHOTO]
Together we can
move mountains-Registered Trademark-
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL
- --------------------------------------------------------------------------------
EQUITY
- --------------------------------------------------------------------------------
FUND
- --------------------------------------------------------------------------------
MARCH 31, 1998
SEMI-ANNUAL REPORT
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL
TABLE OF CONTENTS
EQUITY FUND
<TABLE>
<CAPTION>
INTERNATIONAL EQUITY FUND
<S> <C>
PORTFOLIO MANAGER'S LETTER......................... 2
STATEMENT OF ASSETS AND LIABILITIES................ 5
STATEMENT OF OPERATIONS............................ 5
STATEMENT OF CHANGES IN NET ASSETS................. 6
NOTES TO FINANCIAL STATEMENTS...................... 7
FINANCIAL HIGHLIGHTS............................... 10
BERGER/BIAM INTERNATIONAL PORTFOLIO
SCHEDULE OF INVESTMENTS............................ 12
STATEMENT OF ASSETS AND LIABILITIES................ 16
STATEMENT OF OPERATIONS............................ 17
STATEMENT OF CHANGES IN NET ASSETS................. 18
NOTES TO FINANCIAL STATEMENTS...................... 19
</TABLE>
1
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL
PORTFOLIO MANAGER'S LETTER
EQUITY FUND
PERFORMANCE
For the six-month period ending March 31, 1998, the International Equity Fund
(the "Fund") had a total return of 7.88%(1), compared to 5.87% for MSCI EAFE
Index(2).
The primary positive contributors to performance during the period were
Growth in Telecommunications, Healthcare Needs and, to a lesser extent, Positive
Banking Environment.
Stocks in Growth in Telecommunications had the largest positive impact on
portfolio performance. Mannesmann had a stellar first quarter after announcing a
doubling in its cellular network subscribers in 1997. Cable and Wireless did
well following its affiliate's decision (Hong Kong Telecom) to relinquish its
Hong Kong monopoly. The deal removes uncertainty surrounding the stock that had
held the price back in 1997. Vodafone profited from a surge in new mobile phone
customers and positive reaction to news that a consortium, of which it is a
shareholder, was awarded a license to develop a mobile phone network in Egypt.
Stocks in Healthcare Needs also produced strong returns, led by Zeneca, which
had significant increases in profit and sales. After getting off to a fast
start, Glaxo Wellcome fell back on news that its proposed merger with SmithKline
Beecham was aborted.
Although our Positive Banking Environment theme suffered in the latter part
of 1997, primarily because of the Asian crisis, there was a solid turnaround in
the first quarter 1998. European financial stocks were the linchpin of a strong
equity market performance. The run up in financial stocks was driven by
prospects for continued economic recovery, low interest rates and investor
expectations of further consolidation in the overbanked European region. Among
portfolio holdings, Banco de Santander was a standout. This Spanish bank
performed in line with expectations in 1997, and its decision to acquire another
Spanish bank was greeted very positively by the market.
Pacific Basin themes continued to disappoint, although these now represent a
small portion of the portfolio. Share prices of Japanese stocks in Technological
Innovation also had a negative impact. We believe these stocks were dragged down
by negative sentiment about the Japanese economy overall. Prices may bounce back
when earnings results are released later this spring.
PERIOD IN REVIEW
Global equity markets had a rocky fourth quarter 1997 as Asian troubles
reverberated around the world. In European markets, share prices of companies
with earnings exposure
2
<PAGE>
INTERNATIONAL EQUITY FUND
to the Pacific Rim were hit hard. However, 1998 started on a positive note.
Falling interest rates, receding Asian crisis, positive Wall Street background
and surging liquidity combined to drive the markets higher. Affirmation of the
11 likely starters for European Monetary Union next January gave further impetus
to peripheral European markets, with Spain and especially Italy being the star
performers. In the U.K., British fund managers rotated out of industrial and
cyclical stocks that underperformed during 1997 and into financials and
pharmaceuticals.
In Asia, Indonesia's currency went into free fall, declining 50% as concerns
mounted about increasing bad debts, rising unemployment and upcoming
presidential elections. The currency stabilized by March 31 when a more flexible
reform package was agreed to by the IMF. Japan was not immune to Asian problems,
and its market fell during the period. Japan is the biggest foreign investor,
producer and lender in Asia, so it was no surprise that the regional currency
debacle weighed heavily on Japan's already worrisome bad debt crisis.
LOOKING AHEAD
We are cautiously optimistic about international equity market prospects for
the remainder of 1998. The move toward EMU remains on track, and growth
prospects for core Europe are brighter than at the start of the year. In
Germany, domestic demand is slowly recovering, and, for the first time in more
than a year, unemployment is beginning to fall. Significant mergers and
acquisitions are likely in financials, pharmaceuticals and telecoms, which
should support share prices. Because of the high valuation levels in core
Europe, we may take profits in stocks that look stretched from a valuation
perspective. We are seeking opportunities among stocks that have underperformed
for an extended period and that have a catalyst for change visible on the
horizon.
In Asia, attention is likely to remain on the Japanese government as
investors await intervention to stimulate the domestic economy. Unless and until
there is a meaningful move by the government, the Japanese stock market is
unlikely to recover. We believe that, on a company-by-company basis, value can
still be found in Japanese companies that are continuing to grow their earnings.
We remain extremely cautious on the rest of Asia. The region's economies can
recover, but only with the introduction of painful fiscal measures and massive
deregulation.
We thank you for your investment in the International Equity Fund.
(1) PERFORMANCE FIGURES ARE BASED ON HISTORICAL RESULTS AND ARE NOT INTENDED
TO 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.
(2) THE MORGAN STANLEY CAPITAL INTERNATIONAL EAFE INDEX REPRESENTS MAJOR
OVERSEAS STOCK MARKETS. IT IS AN UNMANAGED INDEX. ONE CANNOT INVEST
DIRECTLY IN AN INDEX.
3
<PAGE>
INTERNATIONAL EQUITY FUND
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
COMPARISON OF CHANGE IN VALUE OF
$1,000,000 INVESTMENT IN
INTERNATIONAL
EQUITY FUND VS. EAFE INDEX
AND COST OF LIVING INDEX
INITIAL INVESTMENT $1,000,000
INTERNATIONAL EAFE COST OF
EQUITY FUND INDEX LIVING INDEX
VALUE OF SHARES
<S> <C> <C> <C>
7/31/89 $1,000,000 $1,000,000 $1,000,000
3/31/90 $1,267,000 $838,777 $1,034,566
3/31/91 $1,263,000 $862,814 $1,085,209
3/31/92 $1,359,000 $796,278 $1,119,775
3/31/93 $1,555,000 $891,892 $1,154,341
3/31/94 $1,888,000 $1,095,573 $1,183,280
3/31/95 $1,904,000 $1,165,375 $1,217,042
3/31/96 $2,367,000 $1,313,047 $1,251,608
3/31/97 $2,651,395 $1,336,073 $1,286,174
3/31/98 $3,111,494 $1,588,938 $1,303,859
International Equity Fund*
Average Annual Total Return
As of March 31, 1998
Life of Fund
1 Year 5 Years (7/31/89)
17.35% 14.88% 13.99%
Past performance is not predictive
of future performance.
</TABLE>
* PERFORMANCE FIGURES ARE HISTORICAL AND DO NOT REPRESENT FUTURE RESULTS.
INVESTMENT RETURNS AND PRINCIPAL VALUE WILL VARY, AND YOU MAY HAVE A LOSS WHEN
YOU SELL SHARES. PERFORMANCE FIGURES ARE HISTORICAL AND, IN PART, REFLECT THE
PERFORMANCE OF A POOL OF ASSETS ADVISED BY BIAM (BANK OF IRELAND ASSET
MANAGEMENT) FOR PERIODS BEFORE THE FUND COMMENCED INVESTMENT OPERATIONS ON
OCTOBER 11, 1996, ADJUSTED TO REFLECT ANY INCREASED EXPENSES ASSOCIATED WITH
OPERATING THE FUND. THE ASSET POOL WAS NOT REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION AND THEREFORE WAS NOT SUBJECT TO THE INVESTMENT
RESTRICTIONS IMPOSED BY LAW ON REGISTERED MUTUAL FUNDS. IF THE POOL HAD BEEN
REGISTERED, ITS PERFORMANCE MIGHT HAVE BEEN ADVERSELY AFFECTED.
4
<PAGE>
INTERNATIONAL EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
MARCH 31, 1998
(UNAUDITED)
<S> <C>
- -------------------------------------------------------------------
ASSETS
Investment in Berger/BIAM International Portfolio
("Portfolio"), at value $6,369,561
- -------------------------------------------------------------------
Total Assets 6,369,561
- -------------------------------------------------------------------
LIABILITIES
Payables
Fund shares redeemed 547
Accrued administrative fee 527
- -------------------------------------------------------------------
Total Liabilities 1,074
- -------------------------------------------------------------------
NET ASSETS APPLICABLE TO SHARES OUTSTANDING $6,368,487
- -------------------------------------------------------------------
- -------------------------------------------------------------------
Capital Shares
Authorized (par value $.01) Unlimited
- -------------------------------------------------------------------
- -------------------------------------------------------------------
Shares outstanding
543,572
- -------------------------------------------------------------------
- -------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER
SHARE
$ 11.72
- -------------------------------------------------------------------
- -------------------------------------------------------------------
</TABLE>
STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED MARCH 31, 1998
<TABLE>
<CAPTION>
<S> <C>
- --------------------------------------------------------------
NET INVESTMENT INCOME ALLOCATED FROM PORTFOLIO:
Interest and dividends (net of $1,445 foreign
withholding taxes) $ 45,687
Portfolio expenses (net of earnings credits and
fee waivers totaling $5,731) (28,027)
- --------------------------------------------------------------
Net Investment Income Allocated from Portfolio 17,660
- --------------------------------------------------------------
FUND EXPENSES:
Administrative fees 2,937
- --------------------------------------------------------------
Total Fund Expenses 2,937
- --------------------------------------------------------------
Net Investment Income (Loss) 14,723
- --------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
ALLOCATED FROM PORTFOLIO:
Net realized gain (loss) on investments and
foreign currency transactions (173,724)
Net change in unrealized appreciation
(depreciation) on investments and foreign
currency transactions 551,524
- --------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currency Transactions
Allocated from Portfolio 377,800
- --------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations $ 392,523
- --------------------------------------------------------------
- --------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
5
<PAGE>
INTERNATIONAL EQUITY FUND
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE PERIOD FROM
MARCH 31, 1998 OCTOBER 11, 1996* TO
(UNAUDITED) SEPTEMBER 30, 1997
<S> <C> <C>
- ---------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income (loss) $ 14,723 $ 53,613
Net realized gain (loss) on investments
and foreign currency transactions (173,724) 121,191
Net change in unrealized appreciation
(depreciation) on investments and
foreign currency transactions 551,524 632,348
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 392,523 807,152
- ---------------------------------------------------------------------------------
FROM DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS
Net investment income (73,365) --
Net realized gains on investments (311,486) --
- ---------------------------------------------------------------------------------
Net Decrease in Net Assets from
Dividends and Distributions to
Shareholders (384,851) --
- ---------------------------------------------------------------------------------
FROM FUND SHARE TRANSACTIONS
Proceeds from shares sold 871,026 7,084,903
Issued in reinvestment of dividends 376,087 --
Payments for shares redeemed (1,229,264) (1,549,089)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Derived from Fund Share Transactions 17,849 5,535,814
- ---------------------------------------------------------------------------------
Increase (Decrease) in Net Assets 25,521 6,342,966
NET ASSETS
Beginning of period 6,342,966 --
- ---------------------------------------------------------------------------------
End of Period $ 6,368,487 $ 6,342,966
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
Capital (par value and paid in surplus) $ 5,553,663 $ 5,535,814
Undistributed net investment income
(loss) (5,029) 53,613
Undistributed net realized gain (loss)
on investments and foreign currency
transactions (364,019) 121,191
Net unrealized appreciation
(depreciation) on investments and
foreign currency transactions 1,183,872 632,348
- ---------------------------------------------------------------------------------
Net Assets $ 6,368,487 $ 6,342,966
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
TRANSACTIONS IN FUND SHARES
Shares sold 77,499 690,065
Shares issued to shareholders in
reinvestment of distributions 36,630 --
Shares repurchased (115,359) (145,263)
- ---------------------------------------------------------------------------------
Net Increase (Decrease) in Shares (1,230) 544,802
Shares outstanding, beginning of period 544,802 --
- ---------------------------------------------------------------------------------
Shares outstanding, end of period 543,572 544,802
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
SEE NOTES TO FINANCIAL STATEMENTS.
6
<PAGE>
INTERNATIONAL EQUITY FUND
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1998 (UNAUDITED)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
The International Equity Fund (the "Fund"), formerly known as the Berger/BIAM
International Institutional Fund prior to June 20, 1997, is a series of the
Berger/BIAM Worldwide Funds Trust (the "Trust"), a Delaware business trust,
organized on May 31, 1996. The Trust is registered under the Investment Company
Act of 1940, as amended, as an open-end management investment company. The Trust
is authorized to issue an unlimited number of shares of beneficial interest in
series or portfolios. Currently, the series comprising the Fund, Berger/BIAM
International Fund and Berger/BIAM International CORE Fund, are the only series
established under the Trust, although others may be added in the future. The
Trust is also authorized to establish multiple classes of shares representing
differing interests in an existing or new series. The Fund commenced investment
operations on October 11, 1996 ("Commencement of Investment Operations").
The investment objective of the Fund is long-term capital appreciation. The
Fund will invest all of its investable assets in the Berger/BIAM International
Portfolio (the "Portfolio"), a series of Berger/BIAM Worldwide Portfolios Trust.
The value of such investment reflects the Fund's proportionate interest in the
net assets of the Portfolio (3% at March 31, 1998). The Portfolio is an open-end
management investment company and has the same investment objective and policies
as the Fund. The performance of the Fund will be derived from the investment
performance of the Portfolio. The financial statements of the Portfolio,
including the schedule of investments, are included elsewhere in this report and
should be read in conjunction with the Fund's financial statements. All costs in
organizing the Trust were paid by BBOI Worldwide LLC, the investment advisor of
the Portfolio (the "Advisor"). The Advisor has delegated the daily portfolio
management of the Portfolio to Bank of Ireland Asset Management (U.S.) Limited
("BIAM" or the "Sub-Advisor"), which owns 50% of the Advisor. Berger Associates,
Inc. ("Berger") also owns 50% of the Advisor.
SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATION
Since the Fund will invest all of its investable assets in the Portfolio, the
value of the Fund's investable assets will be equal to the value of its
beneficial interest in the
7
<PAGE>
INTERNATIONAL EQUITY FUND
Portfolio. Valuation of securities by the Portfolio is discussed in Note 1 of
the Portfolio's Notes to Financial Statement which accompany these Financial
Statements for the Fund.
CALCULATION OF NET ASSET VALUE
The per share calculation of net asset value is determined by dividing the
total value of the Fund's assets, less liabilities, by the total number of
shares outstanding.
INCOME AND EXPENSES
As an investor in the Portfolio, the Fund is allocated its pro rata share of
the aggregate investment income, net realized and unrealized gains or losses and
annual operating expenses (including the investment advisory fee, custodian
fees, independent accountants' fees, record keeping and pricing agent fees) of
the Portfolio. Income and expenses are allocated on the day the income is earned
or the expense is incurred in proportion to the prior day's relative net assets
of the Fund compared to the other investors in the Portfolio. Expenses directly
attributable to the Fund are charged to the Fund.
FEDERAL INCOME TAXES
Each series of the Trust is treated as a separate entity for Federal income
tax purposes. The Fund's policy is to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to shareholders. Therefore, no income tax
provision is required.
DIVIDENDS AND DISTRIBUTIONS
Dividends paid by the Fund from net investment income and distributions of
net realized short-term capital gains are, for Federal income tax purposes,
taxable as ordinary income to shareholders.
The Fund distributes net realized capital gains, if any, to its shareholders
at least annually, if not offset by capital loss carryovers. Income
distributions and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to the differing treatments for
net operating losses and expiring capital loss carryforwards. Accordingly, these
permanent differences in the character of income and distributions between
financial statements and tax basis will be reclassified to paid-in-capital.
USE OF ESTIMATES
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
8
<PAGE>
INTERNATIONAL EQUITY FUND
assets and liabilities at the date of the financial statements and the reported
amounts of increases and decreases in net assets from operations during the
reporting period. Actual results could differ from those estimates.
2. AGREEMENTS
Under an Administrative Services Agreement with the Fund, the Advisor serves
as the administrator of the Fund. Pursuant to such Agreement, the Fund is
obligated to pay the Advisor a fee at an annual rate equal to the lesser of
0.10% of its average daily net assets or the Advisor's annual cost to provide or
procure such services plus 0.01% of the Fund's average daily net assets. Under
the Agreement, the Advisor is responsible, at its own expense, for providing or
procuring all administrative services reasonably necessary for the operation of
the Fund, including recordkeeping and pricing services, custodian services,
transfer agency and dividend disbursing services, tax and audit services,
insurance, legal services, printing and mailing to shareholders of prospectuses
and other required communication and certain other administrative services. The
Advisor has delegated the administration of the Fund to Berger. For such
services, the Advisor pays Berger a sub-administration fee equal to 0.25% of the
Fund's average daily net assets. Berger has voluntarily waived such
sub-administration fee from the Commencement of Investment Operations through
March 31, 1998.
Investors Fiduciary Trust Company ("IFTC") has been appointed to provide
recordkeeping and pricing services to the Fund, including calculating the net
asset value of the Fund, and to perform certain accounting and recordkeeping
functions that it requires. In addition, IFTC has been appointed to serve as the
Fund's custodian, transfer agent and dividend disbursing agent.
Certain officers and trustees of the Trust are officers and directors of
Berger, the Advisor or BIAM. Trustees who are not affiliated with Berger, the
Advisor or BIAM are compensated for their services according to a fee schedule,
allocated among all of the Berger Funds and the Portfolio, which includes an
annual fee component and a per meeting component. Such fees are allocated
directly to the Portfolio and, therefore, indirectly to the Fund.
9
<PAGE>
INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS PRESENTED
<TABLE>
<CAPTION>
PERIOD FROM
OCTOBER 11, 1996*
SIX MONTHS ENDED TO
MARCH 31, 1998 SEPTEMBER 30,
(UNAUDITED) 1997
<S> <C> <C>
- ------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $11.64 $10.00
- ------------------------------------------------------------------------------
From Investment Operations
Net investment income (loss) 0.03 0.10
Net realized and unrealized gain
(loss) on investments 0.78 1.54
- ------------------------------------------------------------------------------
Total from investment operations 0.81 1.64
- ------------------------------------------------------------------------------
Less dividends and distributions
Dividends (from net investment income) (0.14) --
Distributions (from capital gains) (0.59) --
- ------------------------------------------------------------------------------
Total dividends and distributions (0.73) --
- ------------------------------------------------------------------------------
Net Asset Value, End of Period $11.72 $11.64
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Total Return
7.88% 16.40%
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
Ratios/Supplemental Data:
Net assets at end of period (in
thousands) $6,368 $6,343
Net expense ratio to average net assets 1.05%(a) 1.17%(a)
Ratio of net income to average net
assets 0.50%(a) 1.03%(a)
Gross expenses to average net assets (b) 1.25%(a) 1.34%(a)
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
(a) ANNUALIZED.
(b) REFLECTS THE FUND'S EXPENSES PLUS THE FUND'S PRO RATA SHARE OF THE
PORTFOLIO'S GROSS EXPENSES. DURING THE PERIOD, CERTAIN OF THE PORTFOLIO'S
EXPENSES WERE REDUCED AS A RESULT OF VOLUNTARY FEE REDUCTIONS AND/OR
EARNINGS CREDITS. IF SUCH EARNINGS CREDITS AND/OR VOLUNTARY FEE REDUCTIONS
HAD NOT OCCURRED, THE RATIOS WOULD HAVE BEEN AS INDICATED.
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE>
BERGER/BIAM
INTERNATIONAL PORTFOLIO
SEMI - ANNUAL REPORT
The following pages should be read in conjunction
with the International Equity Fund
Semi - Annual Report.
11
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
SCHEDULE OF INVESTMENTS (UNAUDITED)
MARCH 31, 1998
<TABLE>
<CAPTION>
COUNTRY/
SHARES/
PRINCIPAL
AMOUNT COMPANY INDUSTRY VALUE
- ----------- --------------------------------------------- --------------------------------------------- -------------
<C> <S> <C> <C>
COMMON STOCK - 93.31%
AUSTRALIA - 4.91%
260,200 National Australia Bank Commercial Banks & Other Banks $ 3,706,548
573,400 News Corporation Media 3,785,949
428,750 Telstra Corporation Utilities 1,104,525
135,150 Western Mining Mining, Metals & Minerals 463,625
-------------
9,060,647
-------------
CANADA - 0.52%
16,300 Royal Bank Of Canada Commercial Banks & Other Banks 966,525
-------------
DENMARK - 0.37%
7,450 Tele Danmark As-b Utilities 676,945
-------------
FRANCE - 2.91%
690 AXA-UAP Insurance Multi/Property/ Casualty 71,146
4,405 Generale Des Eaux Diversified Holding Companies 716,190
30,455 Michelin B Auto Components 1,820,655
22,970 Total Co. Francaise Petrole 'B' Oil 2,761,968
-------------
5,369,959
-------------
GERMANY - 8.32%
970 Bayerische Motoren Werke Automobiles 1,073,723
12,400 Bayerische Vereinsbank Commercial Banks & Other Banks 906,113
46,845 Hoechst Ag Chemicals 1,837,083
7,640 Mannesmann Ag Machinery & Engineering Services 5,599,372
29,790 Siemens Ag Electrical Equipment 1,996,266
38,631 Veba Ag Diversified Industrials 2,743,450
2,177 Viag Ag Utilities 1,187,808
-------------
15,343,815
-------------
GREAT BRITAIN - 30.62%
185,150 Barclays PLC Commercial Banks & Other Banks 5,548,774
522,890 BAT Industries Beverage Industry/Tobacco Manufacturing 5,331,481
183,200 Cable & Wireless Utilities 2,292,751
127,200 Cadbury Schweppes Beverage Industry/Tobacco Manufacturing 1,765,476
</TABLE>
12
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
<TABLE>
<CAPTION>
COUNTRY/
SHARES/
PRINCIPAL
AMOUNT COMPANY INDUSTRY VALUE
- ----------- --------------------------------------------- --------------------------------------------- -------------
<C> <S> <C> <C>
COMMON STOCK - CONTINUED
220,300 Diageo PLC Beverage Industry/Tobacco Manufacturing $ 2,592,928
149,700 Glaxo Wellcome PLC Health & Personal Care 4,027,708
217,650 Granada Group Entertainment/Leisure/Toys 3,913,661
85,514 Kingfisher PLC Retail Trade 1,602,092
316,400 Ladbroke Group Entertainment/Leisure/Toys 1,770,631
262,200 Lloyds TSB Group Commercial Banks & Other Banks 4,078,201
95,800 Premier Farnell Wholesale Trade 615,107
297,640 Prudential Corporation Insurance Life & Agents/Brokers 4,375,282
226,450 Safeway PLC Retail Trade 1,404,691
66,500 Scottish Power Utilities 625,717
463,880 Shell Transportation & Trading Corporation Oil 3,409,498
145,391 Siebe PLC Machinery & Engineering Services 3,171,774
213,300 TI Group PLC Machinery & Engineering Services 1,871,295
364,600 Vodafone Group Utilities 3,815,197
99,330 Zeneca Group Health & Personal Care 4,280,645
-------------
56,492,909
-------------
HONG KONG - 1.17%
70,400 HSBC Holdings Commercial Banks & Other Banks 2,153,238
-------------
INDONESIA - 0.25%
212,000 Gudang Garam Beverage Industry/Tobacco Manufacturing 293,491
180,000 HM Sampoerna Beverage Industry/Tobacco Manufacturing 163,352
-------------
456,843
-------------
IRELAND - 0.40%
257,100 Smurfit (Jefferson) Group Forestry & Paper Products 737,611
-------------
ITALY - 1.83%
69,006 Eni Spa Itl Oil 470,650
368,030 Telecom Italia Utilities 2,903,213
-------------
3,373,863
-------------
JAPAN - 13.18%
199,000 Canon Inc Computer/Commercial/Office Equipment 4,497,766
</TABLE>
13
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
<TABLE>
<CAPTION>
COUNTRY/
SHARES/
PRINCIPAL
AMOUNT COMPANY INDUSTRY VALUE
- ----------- --------------------------------------------- --------------------------------------------- -------------
<C> <S> <C> <C>
COMMON STOCK - CONTINUED
87,000 Dai Nippon Printing Media $ 1,437,206
107,000 Honda Motor Automobiles 3,856,579
106,000 Kao Corporation Food & Grocery 1,392,904
9,400 Keyence Corporation Electronics & Instruments 1,298,742
42,000 Murata Manufacturing Co Electronics & Instruments 1,160,578
17,000 Rohm Company Limited Electronics & Instruments 1,557,349
101,000 Shiseido Corporation Health & Personal Care 1,160,352
53,200 Sony Corporation Household Durables & Appliances 4,514,060
135,000 Takeda Chemical Health & Personal Care 3,436,455
-------------
24,311,991
-------------
MALAYSIA - 0.30%
103,000 Hume Industries Construction & Building Materials 111,442
403,400 Sime Darby Diversified Holding Companies 449,691
-------------
561,133
-------------
MEXICO - 0.42%
301,770 Grupo Financiero Banamex Commercial Banks & Other Banks 768,277
-------------
NETHERLANDS - 8.72%
76,280 ABN-Amro Holdings Commercial Banks & Other Banks 1,762,068
105,150 Elsevier Media 1,732,090
119,807 ING Groep N.V. Insurance - Multi/Property/ Casualty 6,806,660
52,790 Koninklijke PTT Utilities 2,738,057
31,300 Nutricia Food Manufacturing 1,125,883
33,800 Royal Dutch Petroleum Oil 1,915,428
-------------
16,080,186
-------------
PHILIPPINES - 0.24%
254,370 San Miguel Corporation Class-B Beverage Industry/Tobacco Manufacturing 443,375
-------------
PORTUGAL - 0.25%
19,950 Electricidade De Portugal Utilities 463,426
-------------
SINGAPORE - 3.03%
285,000 City Development Real Estate 1,403,375
233,412 Development Bank of Singapore Commercial Banks & Other Banks 1,705,953
</TABLE>
14
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
<TABLE>
<CAPTION>
COUNTRY/
SHARES/
PRINCIPAL
AMOUNT COMPANY INDUSTRY VALUE
- ----------- --------------------------------------------- --------------------------------------------- -------------
<C> <S> <C> <C>
COMMON STOCK - CONTINUED
174,600 Fraser And Neave Beverage Industry/Tobacco Manufacturing $ 740,792
151,972 Singapore Press Holdings Media 1,741,390
-------------
5,591,510
-------------
SPAIN - 1.67%
61,680 Banco de Santander Commercial Banks & Other Banks 3,075,936
-------------
SWITZERLAND - 14.20%
1,675 Alusuisse Lonza Holdings Fabricated Metal Products 2,035,370
2,634 Nestle Sa Food & Grocery Products 5,039,799
4,609 Novartis Ag-RE Health & Personal Care 8,167,809
269 Roche Holding Health & Personal Care 2,915,366
2,680 Schw Ruckverischer Insurance - Multi/Property/ Casualty 5,895,313
1,315 Union Bank of Switzerland Insurance - Multi/Property/ Casualty 2,150,745
-------------
26,204,402
-------------
TOTAL COMMON STOCK (Cost $146,828,511) 172,132,591
-------------
REPURCHASE AGREEMENT - 4.51%
$ 8,321,000 State Street Bank Repurchase Agreement, 5.70% dated March 31, 1998, to be repurchased at
$8,322,317 on April 1, 1998, collateralized by U.S. Treasury Bond, 6.75% - June 25, 2005,
with a value of $8,491,700 (cost $8,321,000)
8,321,000
-------------
TOTAL REPURCHASE AGREEMENT (Cost $8,321,000) 8,321,000
-------------
Total Investments (cost $155,149,511) - 97.82% 180,453,591
Other assets, less liabilities - 2.18% 4,028,788
-------------
Net Assets - 100.00% $184,482,379
-------------
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
MARCH 31, 1998
(UNAUDITED)
<S> <C>
- ----------------------------------------------------------------------------------
ASSETS
Investments, at cost $155,149,511
- ----------------------------------------------------------------------------------
Investments, at value $180,453,591
Cash 4,432,884
Foreign cash (cost $1,476,766) 1,487,906
Receivables
Investment securities sold 611,994
Contributions 354,601
Dividends 754,306
Interest 1,317
Foreign currency contracts 709,740
- ----------------------------------------------------------------------------------
Total Assets 188,806,339
- ----------------------------------------------------------------------------------
LIABILITIES
Payables
Investment securities purchased 4,136,263
Withdrawals 40,012
Accrued investment advisory fees 135,470
Accrued audit fees 12,215
- ----------------------------------------------------------------------------------
Total Liabilities 4,323,960
- ----------------------------------------------------------------------------------
NET ASSETS REPRESENTED BY: PAID-IN CAPITAL FOR
BENEFICIAL INTERESTS $184,482,379
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
SIX
MONTHS ENDED
MARCH 31, 1998
(UNAUDITED)
<S> <C>
- -------------------------------------------------------------------
INVESTMENT INCOME
Income
Dividends (net of $52,815 foreign tax withheld) $ 997,728
Interest 153,741
- -------------------------------------------------------------------
Total Income 1,151,469
- -------------------------------------------------------------------
Expenses
Investment advisory fees 636,279
Accounting fees 20,846
Custodian fees 52,170
Audit fees 30,216
Legal fees 5,192
Directors'/Trustees' fees and expenses 5,945
Reports to shareholders 3,151
Other expenses 5,795
- -------------------------------------------------------------------
Total Expenses 759,594
Less fees waived by advisor (46,645)
Less earnings credits (73,015)
- -------------------------------------------------------------------
Total Expenses, Net 639,934
- -------------------------------------------------------------------
Net investment income (loss) 511,535
- -------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain (loss) on securities and
foreign currency transactions (4,371,369)
Net change in unrealized appreciation
(depreciation) on securities and foreign
currency transactions 18,736,707
- -------------------------------------------------------------------
Net Realized and Unrealized Gain (Loss) on
Investments and Foreign Currency Transactions 14,365,338
- -------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting
from Operations $14,876,873
- -------------------------------------------------------------------
- -------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED PERIOD FROM
MARCH 31, 1998 OCTOBER 11, 1996* TO
(UNAUDITED) SEPTEMBER 30, 1997
<S> <C> <C>
- -----------------------------------------------------------------------------------
OPERATIONS:
Net investment income (loss) $ 511,535 $ 1,018,078
Net realized gain (loss) on securities
and foreign currency transactions (4,371,369) 1,712,223
Net change in unrealized appreciation
(depreciation) on securities and
foreign currency transactions 18,736,707 6,712,560
- -----------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 14,876,873 9,442,861
- -----------------------------------------------------------------------------------
FROM TRANSACTIONS IN INVESTORS'
BENEFICIAL INTEREST
Contributions 63,796,915 127,144,416
Withdrawals (16,408,409) (14,370,277)
- -----------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
From Investors' Transactions 47,388,506 112,774,139
- -----------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 62,265,379 122,217,000
- -----------------------------------------------------------------------------------
NET ASSETS
Beginning of period 122,217,000 0
- -----------------------------------------------------------------------------------
End of period $184,482,379 $122,217,000
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS
Capital (par value and paid in surplus) $160,162,645 $112,774,139
Undistributed net investment income
(loss) 1,529,613 1,018,078
Undistributed net realized gain (loss)
from investments (2,659,146) 1,712,223
Net unrealized appreciation
(depreciation) of securities and
foreign currency transactions 25,449,267 6,712,560
- -----------------------------------------------------------------------------------
Total $184,482,379 $122,217,000
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
RATIOS/SUPPLEMENTARY DATA
Net assets, end of period (in thousands) $ 184,482 $ 122,217
Net expense ratio to average net assets 0.90%(1) 0.89%(1)
Ratio of net income (loss) to average
net assets 0.72%(1) 1.63%(1)
Gross expenses to average net assets(2) 1.07%(1) 1.10%(1)
Portfolio turnover rate 8% 17%
Average Commission Paid $ 0.0213 $ 0.0248
</TABLE>
* COMMENCEMENT OF INVESTMENT OPERATIONS.
1. ANNUALIZED.
2. DURING THE PERIOD, CERTAIN FEES WERE REDUCED AS A RESULT OF VOLUNTARY FEE
REDUCTIONS AND/OR EARNING CREDITS. IF SUCH EARNING CREDITS AND/OR VOLUNTARY
FEE REDUCTIONS HAD NOT OCCURRED, THE RATIOS WOULD HAVE BEEN AS INDICATED.
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
MARCH 31, 1998
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
The Berger/BIAM International Portfolio (the "Portfolio") is registered under
the Investment Company Act of 1940, as amended, as an open-end management
investment company. The Portfolio is a series of the Berger/BIAM Worldwide
Portfolios Trust (the "Trust"), which was organized as a Delaware business trust
on May 31, 1996. All costs in organizing the Trust were paid by BBOI Worldwide
LLC ("BBOI"), the investment advisor of the Portfolio. The Portfolio commenced
investment operations on October 11, 1996, ("Commencement of Investment
Operations") with the sale of 448,161 shares of beneficial interest to the
International Equity Fund, formerly known as the Berger/BIAM International
Institutional Fund, in exchange for portfolio assets with an aggregate value of
$4,481,609, which were transferred from the Pooled Trust of Citizens Bank of New
Hampshire ("Citizens NH") to the International Equity Fund and, in turn,
transferred to the Portfolio. Such transaction was a tax-free exchange. Citizens
NH is an affiliate of Bank of Ireland Asset Management (U.S.) Limited ("BIAM"),
which was the investment sub-advisor to the Pooled Trust and is the investment
sub-advisor to the Portfolio. Currently there are three investors in the
Portfolio, the Berger/BIAM International Fund, the International Equity Fund and
the Berger/BIAM International CORE Fund.
The investment objective of the Portfolio is long-term capital appreciation.
The Portfolio invests primarily in common stocks of well-established companies
located outside the United States.
The Portfolio is advised by BBOI, which has delegated daily portfolio
management of the Portfolio to BIAM. Berger Associates, Inc. ("Berger") and BIAM
each own 50% of BBOI.
SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Portfolio in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
INVESTMENT VALUATION
The Portfolio's securities and other assets are valued at the close of the
regular trading session of the New York Stock Exchange (the "Exchange")
(normally 4:00 p.m. New York time) each day the Exchange is open. The
Portfolio's securities and other assets are valued as follows: securities listed
or traded primarily on foreign exchanges, national exchanges and the NASDAQ
Stock market are valued at the last sale price on such markets, or, if such a
price is lacking for the trading period immediately preceding the time of
determination, such securities are valued at the mean of their current bid and
asked prices. Securities that are traded in the over-the-counter market are
valued at the mean between their current bid
19
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
and asked prices. The market value of individual securities held by the
Portfolio are determined by using pricing services which provide market prices
to other mutual funds or, as needed, by obtaining market quotations from
independent broker/dealers. Short-term money market securities maturing within
60 days are valued on the amortized cost basis, which approximates market value.
Securities and assets for which quotations are not readily available are valued
at fair values determined in good faith pursuant to consistently applied
procedures established by the trustees.
Generally, trading in foreign securities markets is substantially completed
each day at various times prior to the close of the Exchange. The values of
foreign securities used in computing the net asset value of the shares in the
Portfolio are determined as of the earlier of such market close or the closing
time of the Exchange. Occasionally, events affecting the value of such
securities may occur between the times at which they are determined and the
close of the Exchange, or when the foreign market on which such securities trade
is closed but the Exchange is open, which will not be reflected in the
computation of net asset value. If during such periods, events occur that
materially affect the value of such securities, the securities will be valued at
their fair market value as determined in good faith pursuant to consistently
applied procedures established by the trustees.
FOREIGN CURRENCY TRANSLATION
Assets and liabilities initially expressed in terms of foreign currencies are
translated into U.S. dollars at the prevailing market rates as quoted by one or
more banks or dealers on the date of valuation. The cost of securities is
translated into U.S. dollars at the rates of exchange prevailing when such
securities were acquired. Income and expenses are translated into U.S. dollars
at rates of exchange prevailing when accrued.
FEDERAL INCOME TAXES
The Portfolio is considered a partnership for federal income tax purposes. As
such, each investor in the Portfolio will be taxed on its share of the
Portfolio's ordinary income and capital gains. It is intended that the
Portfolio's assets will be managed in such a way that an investor in the
Portfolio will be able to satisfy the requirements of Sub-Chapter M of the
Internal Revenue Code.
INVESTMENT TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for on the trade date. Gains and losses
are computed on the identified cost basis for both financial statement and
Federal income tax purposes for all securities. Dividend income is recorded on
the ex-dividend date, except if the ex-dividend date has passed, certain
dividends from foreign securities are recorded as soon as the Portfolio is
informed of the ex-dividend date. Dividend income
20
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
is recorded net of foreign taxes withheld where recovery of such taxes is not
assured. Interest income is recorded on the accrual basis and includes
amortization of discounts and premiums.
USE OF ESTIMATES
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 increases and decreases in net assets from operations
during the reporting period. Actual results may differ from those estimates.
FORWARD CURRENCY CONTRACTS
The Portfolio may enter into forward foreign currency exchange contracts for
the purpose of hedging the Portfolio against exposure to market value
fluctuations in foreign currencies. The use of such instruments may involve
risks such as the possibility of illiquid markets or imperfect correlation
between the value of the contracts and the underlying securities, or that the
counterparty will fail to perform its obligations. Forward currency contracts
and foreign denominated assets may involve more risks than domestic
transactions, including currency risk, political and economic risk, regulatory
risk and market risk. Risks may arise from the potential inability of a
counterparty to meet the terms of a contract and from unanticipated movements in
the value of foreign currencies relative to the U.S. dollar. The forward foreign
currency exchange contracts are adjusted to the daily exchange rate of the
underlying currency and any gains or losses are recorded for financial statement
purposes as unrealized gains or losses until the contract settlement date.
2. AGREEMENTS
BBOI renders investment advisory services to the Portfolio pursuant to an
agreement that provides for an investment advisory fee to be paid to BBOI at the
annual rate of .90 of 1% of the Portfolio's average daily net assets. Until at
least April 30, 1998, BBOI has agreed voluntarily to waive its advisory fee to
the extent that the Portfolio's normal operating expenses in any fiscal year
(including the investment advisory fee and custodian fees, but excluding
brokerage commissions, interest, taxes and extraordinary expenses) exceed 1.00%
of the Portfolio's average daily net assets for that fiscal year. BBOI is also
responsible for providing for or arranging for all managerial and administrative
services necessary for the operations of the Portfolio. BBOI has delegated the
daily investment management of the Portfolio to BIAM. For such services, BBOI
pays BIAM a sub-advisory fee equal to .45% of the average daily net assets of
the Portfolio. Such sub-advisory fee has been voluntarily waived by BIAM from
the Commencement of Investment Operations through March 31, 1998, except for an
amount payable on the Citizens NH converted assets (see note 1).
21
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
Investors Fiduciary Trust Company ("IFTC") has been appointed to provide
record keeping and pricing services to the Portfolio, including calculating the
net asset value of the Portfolio, and to perform certain accounting and record
keeping functions required by the Portfolio. In addition, IFTC has been
appointed to serve as the Portfolio's custodian and transfer agent. For
custodian, record keeping and pricing services, the Portfolio pays a fee
directly to IFTC based on a percentage of its net assets, subject to certain
minimums, and reimburses IFTC for certain out-of-pocket expenses. IFTC's fees
for custody, recordkeeping and pricing, or transfer agency services are subject
to reduction by credits earned by the Portfolio, based on the cash balances of
the Portfolio held by IFTC as custodian or by credits received from directed
brokerage transactions. For the six months ended March 31, 1998, the Portfolio
received $73,000 in earnings credits, which offset the fees payable to IFTC for
services rendered.
Certain officers and trustees of the Trust are officers and directors of
Berger, BBOI or BIAM. Trustees who are not affiliated with Berger, BBOI or BIAM
are compensated for their services according to a fee schedule, allocated among
the Berger Funds (which consists of the New Generation Fund, Select Fund, Small
Company Growth Fund, Small Cap Value Fund, Mid Cap Growth Fund, One Hundred
Fund, Growth & Income Fund and Balanced Fund) and the Portfolio, which includes
an annual fee component and a per meeting component. Trustees' fees and expenses
for the six months ended March 31, 1998, totaled $6,000.
3. INVESTMENT TRANSACTIONS
PURCHASES AND SALES
Purchases and sales of investment securities (excluding short-term
securities) during the six-month period ended March 31, 1998, were as follows:
<TABLE>
<CAPTION>
Purchase of Sales of
Investment Investment
Securities Securities
- ------------------ ------------------
<S> <C>
$ 57,932,386 $ 10,305,328
</TABLE>
There were no purchases or sales of long-term U.S. Government securities
during the period.
At March 31, 1998, the composition of unrealized appreciation (the excess of
value over tax cost) and unrealized depreciation (the excess of tax cost over
value) for securities held was as follows:
<TABLE>
<CAPTION>
Gross Gross
Federal Tax Unrealized Unrealized
Cost Appreciation Depreciation Net
- -------------- ----------- ----------- -----------
<S> <C> <C> <C>
$155,156,875 $34,253,443 ($8,956,727) $25,296,716
</TABLE>
22
<PAGE>
BERGER/BIAM INTERNATIONAL PORTFOLIO
4. LINE OF CREDIT
The Portfolio, along with the Berger New Generation Fund, Berger Small
Company Growth Fund, Berger Small Cap Value Fund, Berger One Hundred Fund and
Berger Growth and Income Fund (the "Funds"), are party to an ongoing agreement
with certain banks that allows the Funds and the Portfolio, collectively, to
borrow up to $150 million, subject to certain conditions, for temporary or
emergency purposes. Interest on any borrowings, if any, is charged to the
specific fund executing the borrowing at the Federal Funds Rate plus 75 basis
points. In addition, the unsecured line of credit requires a quarterly payment
of a commitment fee based on the average daily unused portion of the line of
credit. At March 31, 1998, the outstanding balance on the line of credit was $0.
23
