<PAGE> 1
Driehaus Mutual Funds
Trustees & Officers
Richard H. Driehaus
Chairman of the Board & President
Francis J. Harmon
Trustee
Robert F. Moyer
Senior Vice President & Trustee
A.R. Umans
Trustee
Daniel Zemanek
Trustee
William R. Andersen
Vice President
Diane L. Wallace
Vice President & Treasurer
Mary H. Weiss
Vice President & Secretary
Robert H. Buchen
Vice President
Dusko Culafic
Assistant Treasurer
Jennifer L. Billingsley
Assistant Secretary
Investment Advisor
Driehaus Capital Management, Inc.
25 East Erie Street
Chicago, IL 60611
Distributor
Driehaus Securities Corporation
25 East Erie Street
Chicago, IL 60611
Administrator & Transfer Agent
PFPC Inc.
400 Bellevue Parkway
Suite 108
Wilmington, DE 19809
Custodian
The Chase Manhattan Bank
3 Chase MetroTech Center
Brooklyn, NY 11245
SEMI-ANNUAL REPORT TO SHAREHOLDERS
JUNE 30, 1999
[DRIEHAUS MUTUAL FUNDS LOGO]
DRIEHAUS INTERNATIONAL GROWTH FUND
DRIEHAUS INTERNATIONAL DISCOVERY FUND
DRIEHAUS EUROPEAN OPPORTUNITY FUND
DRIEHAUS ASIA PACIFIC GROWTH FUND
DRIEHAUS EMERGING MARKETS GROWTH FUND
Distributed by:
DRIEHAUS SECURITIES CORPORATION
This report has been prepared for the shareholders of the Funds and is not
an offering to sell or buy any Fund securities. Such offering is only made
by the Funds' prospectus.
<PAGE> 2
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Driehaus International Growth Fund
Letter from Portfolio Manager.................... 1
Schedule of Investments.......................... 3
Driehaus International Discovery Fund
Letter from Portfolio Manager.................... 11
Schedule of Investments.......................... 14
Driehaus European Opportunity Fund
Letter from Portfolio Manager.................... 21
Schedule of Investments.......................... 24
Driehaus Asia Pacific Growth Fund
Letter from Portfolio Manager.................... 31
Schedule of Investments.......................... 34
Driehaus Emerging Markets Growth Fund
Letter from Portfolio Manager.................... 41
Schedule of Investments.......................... 44
Each Fund section includes:
Schedule of Investments by Industry
Statement of Assets and Liabilities
Statement of Operations
Statement of Changes in Net Assets
Financial Highlights
Notes to Financial Statements............................... 52
</TABLE>
<PAGE> 3
SEMI-ANNUAL REPORT TO SHAREHOLDERS
JUNE 30, 1999
Investment Philosophy:
The Adviser seeks to achieve superior investment returns primarily
by investing in companies outside the U.S. that are currently
demonstrating rapid growth in their sales and earnings and which,
in our judgement, have the ability to continue or accelerate their
growth rates in the future. The Adviser manages the portfolios
actively (above average turnover) to insure that the Funds are
fully invested, under appropriate market conditions, in companies
that meet these criteria. Investors should note that investments
in overseas markets can pose more risks than U.S. investments, and
the Funds' share prices are expected to be more volatile than that
of U.S.-only funds. In addition, the Funds' returns will fluctuate
with changes in stock market conditions, currency values, interest
rates, foreign government regulations, and economic and political
conditions in countries in which the Funds invest. These risks are
generally greater when investing in emerging markets.
DRIEHAUS INTERNATIONAL GROWTH FUND
DRIEHAUS INTERNATIONAL DISCOVERY FUND
DRIEHAUS EUROPEAN OPPORTUNITY FUND
DRIEHAUS ASIA PACIFIC GROWTH FUND
DRIEHAUS EMERGING MARKETS GROWTH FUND
<PAGE> 4
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND - PORTFOLIO MANAGER'S LETTER
- --------------------------------------------------------------------------------
Dear Fellow Shareholders:
For the period from January 1, 1999, through June 30, 1999, the Driehaus
International Growth Fund returned 12.81%. This compares with a return of 3.97%
for the Morgan Stanley Capital International Europe, Australia, Far East Index
and 6.90% for the Lipper International Fund Index for the first six months of
1999. Since the fund's inception on July 1, 1990, the Driehaus International
Growth Fund posted an annualized return of 16.28%, compared with the MSCI EAFE
Index's 6.98% and the Lipper International Fund Index's 8.47% over the same
period.
During the first half of 1999, the fund performed well, due mainly to
superior stock selection and the shifts we made in the portfolio's regional
allocations, which represented some of our most important portfolio changes in a
number of years. After several years of finding the fastest growing companies
predominately in Europe, we started to see a dramatic shift in the first quarter
of 1999. At the same time that earnings estimates in Europe began to fall,
estimates for companies and economies in Asia started to accelerate. Although we
are not a "macro"-oriented fund, our "micro"-oriented investment philosophy has
led us to make substantial portfolio changes several times over the years. We
believe the events of the first quarter presented us with another such case. As
a consequence, we reduced our European weighting from approximately 75% to just
over 40% and increased our exposure to Asian markets from less than 17% to about
40%.
The turnaround in the Asian economies has been much quicker and much more
dramatic than we had forecast. We now believe the recovery is firmly entrenched
and should continue for some time. As we see the Asian economies begin to
rebound, we have found a number of exciting new companies to purchase that fit
our criteria -- rapid growth and the ability to exceed investors'
expectations -- in sectors such as technology, telephony, real estate, and
financial services.
Also for the first time in several years, the fund has a large weighting in
Japan, where we believe the economy and the environment for shares have also
improved. Much has been written about banking reform and corporate restructuring
in Japan, and we are focusing on companies that will be direct beneficiaries of
these types of reforms. For example, software companies such as Fujitsu Support
& Service, Inc. have shown strong growth as Japanese companies strive to become
more efficient and profitable. Another important theme in Japan is a rapidly
increasing emphasis on technology by Japanese businesses and consumers. Japanese
spending on technology has lagged far behind that of the U.S. and Europe, but
this is now changing. Among our holdings at the end of June was Hikari Tsushin,
Inc., a company that is helping small and medium-sized Japanese firms become
established on the Internet. Softbank Corporation, which represented our largest
holding as of June 30, 1999, has made numerous investments in Internet-related
businesses in Japan. In many cases, Softbank is using the U.S. Internet
experience as a model for the development of the Japanese version of the
Internet.
Turning to Europe, we have maintained most of our weightings in the highest
quality growth companies that were in our portfolio, while reducing our exposure
to companies with earnings growth that was highly dependent on a strong European
economic recovery. Companies that we have highlighted in the past -- such as
COLT Telecom Group PLC and Vodaphone AirTouch PLC -- continue to be holdings in
our portfolio and have continued their excellent records of strong growth.
Looking forward, we do have some concerns about the rapidity of the Asian
recovery and would not be surprised to see a slight correction during the second
half of 1999. However, we are strongly convinced that the turnaround in Asia is
well entrenched, and we anticipate continued strong performance from these
economies and -- ultimately -- from these stock markets.
Sincerely,
William R Anderson
William R. Andersen
Portfolio Manager
August 25, 1999
1
<PAGE> 5
DRIEHAUS INTERNATIONAL GROWTH FUND
AVERAGE ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DRIEHAUS INTERNATIONAL MSCI LIPPER
GROWTH FUND EAFE INTERNATIONAL
(DIGF) INDEX FUND INDEX
---------------------- ----- -------------
<S> <C> <C> <C>
One Year ended 6/30/99 -3.92% 7.62% 4.00%
Three Years ended 6/30/99 13.07% 8.81% 10.80%
Five Years ended 6/30/99 17.94% 8.21% 10.10%
Since Inception (7/1/90 -- 6/30/99) 16.28% 6.98% 8.47%
</TABLE>
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you sell
shares.
<TABLE>
<CAPTION>
LIPPER INTERNATIONAL
DIGF MSCI EAFE INDEX FUND INDEX
---- --------------- --------------------
<S> <C> <C> <C>
Jun 1990 100,000.00 100,000.00 100,000.00
86,601.00 78,801.40 81,728.90
89,754.80 87,098.90 85,404.70
102,746.00 93,573.00 91,999.00
Jun 1991 105,643.00 88,467.00 89,596.00
105,258.00 96,051.00 95,356.00
109,228.00 97,661.00 96,654.00
117,111.00 86,071.00 94,687.00
Jun 1992 126,030.00 87,891.00 98,946.00
118,282.00 89,216.00 93,676.00
118,606.00 85,773.00 92,514.00
135,240.00 96,054.00 100,444.00
Jun 1993 142,834.00 105,716.00 105,962.00
163,373.00 112,727.00 116,121.00
206,030.00 113,701.00 128,763.00
175,484.00 117,676.00 127,382.00
Jun 1994 170,382.00 123,688.00 128,499.00
190,949.00 123,808.00 133,501.00
177,981.00 122,545.00 127,815.00
169,343.00 124,827.00 124,638.00
Jun 1995 186,111.00 125,734.00 130,987.00
207,588.00 130,976.00 138,125.00
210,166.00 136,279.00 140,625.00
239,371.00 140,217.00 146,824.00
Jun 1996 268,940.00 142,436.00 152,817.00
253,440.00 142,257.00 152,934.00
261,596.00 144,520.00 160,915.00
270,985.00 142,257.00 164,901.00
Jun 1997 307,522.00 160,718.00 183,358.00
320,208.00 159,586.00 186,871.00
299,239.00 147,090.00 172,578.00
368,797.00 168,726.00 198,181.00
Jun 1998 404,569.00 170,518.00 199,863.00
327,062.00 146,280.00 168,329.00
344,570.00 176,503.00 194,428.00
353,222.00 178,958.00 196,919.00
Jun 1999 388,723.00 183,506.00 207,850.00
</TABLE>
The Driehaus International Growth Fund (the "Fund" or "DIGF") performance
data shown above includes the performance of the Driehaus International Large
Cap Fund, L.P. (the "Partnership"), the Fund's predecessor, for the periods
before the Fund's registration statement became effective. The Partnership was
established on July 1, 1990 and the Fund succeeded to the Partnership's assets
on October 28, 1996. The Partnership was not registered under the Investment
Company Act of 1940 and thus was not subject to certain investment and
operational restrictions that are imposed by the 1940 Act. If the Partnership
had been registered under the 1940 Act, its performance may have been adversely
affected. The Partnership's performance has been restated to reflect the
expenses of the Fund.
Performance data presented measures change in the value of an investment in
the Fund, assuming reinvestment of all dividends and capital gains. Average
annual total return reflects annualized change.
The graph compares the results of a $100,000 investment in the Fund, since
July 1, 1990, (the date of the Partnership's inception), with all dividends and
capital gains reinvested, with the Morgan Stanley Capital International (MSCI)
EAFE Index with dividends reinvested and the Lipper International Fund Index
with dividends reinvested for the same period.
The EAFE Index (MSCI Europe, Australia and Far East Index) is a widely
recognized benchmark of non-U.S. stock markets. It is an unmanaged index
composed of a sample of companies representative of the market structure of 20
European and Pacific Basin countries. Data is in U.S. dollars. Source: Morgan
Stanley Capital International.
The Lipper International Fund Index is an equally weighted managed index of
the 30 largest qualifying international funds that invest in securities with
primary trading markets outside of the United States. Data is in U.S. dollars.
Source: Lipper Analytical Services.
2
<PAGE> 6
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DRIEHAUS INTERNATIONAL GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 98.8%
- ----------------------------------------------------------
EUROPE -- 42.0%
UNITED KINGDOM -- 11.7%
British Telecommunications
PLC....................... 102,645 $ 1,719,916
COLT Telecom Group
PLC -- ADR**.............. 36,162 3,123,493
Energis PLC**............... 207,255 4,942,880
Granada Group PLC........... 80,730 1,497,778
Kingfisher PLC.............. 82,135 945,121
Logica PLC.................. 212,655 2,229,120
Orange PLC**................ 175,135 2,567,391
Psion PLC................... 165,585 2,140,282
TeleWest Communications
PLC**..................... 1,310,024 5,874,862
Vodafone AirTouch PLC --
ADR....................... 24,106 4,748,882
------------
29,789,725
------------
FRANCE -- 8.0%
Business Objects SA --
ADR**..................... 47,859 1,746,853
Equant NV**................. 31,895 2,940,571
Equant NV -- ADR**.......... 30,322 2,854,058
Sidel SA.................... 44,575 5,419,718
Societe Television Francaise
SA........................ 18,468 4,304,274
Vivendi SA.................. 41,148 3,333,239
------------
20,598,713
------------
GERMANY -- 7.5%
Consors Discount Broker
AG**...................... 31,087 2,372,368
Edel Music AG**............. 24,570 1,849,693
EM TV & Merchandising AG.... 2,220 3,228,075
Intershop Communications
AG**...................... 9,610 2,309,143
Kamps AG.................... 64,419 2,590,897
Mannesmann AG............... 37,649 5,629,801
MobilCom AG................. 14,255 1,308,365
------------
19,288,342
------------
ITALY -- 6.0%
Arnoldo Mondadori Editore
SpA....................... 223,520 3,872,552
Autogrill SpA............... 85,880 884,767
BIPOP SpA................... 114,455 4,904,304
Mediaset SpA................ 370,195 3,290,860
Seat Pagine Gialle SpA...... 1,825,800 2,494,828
------------
15,447,311
------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
SWEDEN -- 2.6%
Hennes & Mauritz AB -- B.... 267,560 $ 6,608,953
------------
NETHERLANDS -- 2.3%
Libertel NV**............... 45,780 897,018
United Pan-Europe
Communications NV**....... 92,039 4,992,628
------------
5,889,646
------------
FINLAND -- 2.1%
Nokia Corp. -- ADR.......... 57,142 5,232,064
Raisio Group PLC............ 11,280 104,694
------------
5,336,758
------------
TURKEY -- 1.8%
Yapi Ve Kredi Bankasi AS.... 317,338,818 4,587,053
------------
RUSSIA 0.0%
Novosibirsk Telephone**..... 4,000 16,000
------------
Total Europe................ 107,562,501
------------
FAR EAST -- 40.6%
JAPAN -- 16.8%
Fancl Corp. ................ 17,000 3,089,986
Fast Retailing Co., Ltd. ... 14,600 1,568,126
Fuji Television Network,
Inc. ..................... 560 3,025,873
Fujitsu Support & Service,
Inc. ..................... 21,700 3,284,506
Hikari Tsushin, Inc. ....... 12,200 3,769,782
Hirose Electric Co.,
Ltd. ..................... 24,400 2,532,004
Jafco Co., Ltd. ............ 21,600 1,427,672
Matsushita Communication
Industrial Co., Ltd. ..... 52,000 3,716,245
Murata Manufacturing Co.,
Ltd. ..................... 52,000 3,419,804
Nichii Gakkan Co. .......... 12,700 1,385,041
NTT Mobile Communications
Network, Inc. ............ 315 4,268,146
Obic Co., Ltd. ............. 1,000 273,472
Ryohin Keikaku Co., Ltd. ... 11,700 2,943,459
Softbank Corp. ............. 35,400 7,168,552
Tokyo Seimitsu Co., Ltd. ... 17,100 1,089,270
------------
42,961,938
------------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
3
<PAGE> 7
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
SOUTH KOREA -- 6.1%
Housing & Commercial Bank
144A -- GDR+.............. 96,935 $ 3,014,678
Kookmin Bank 144A -- GDR+... 155,965 3,197,282
Korea Telecom Corp. --
ADR**..................... 11,636 465,440
Samsung Electronics ........ 34,300 3,763,488
SK Telecom Co., Ltd. --
ADR ...................... 303,171 5,153,907
------------
15,594,795
------------
THAILAND -- 4.9%
Advanced Info Service Public
Co., Ltd. (Foreign)**..... 413,500 5,606,950
Bangkok Bank Public Co.,
Ltd. (Foreign)**.......... 694,900 2,600,654
Krung Thai Bank Public Co.,
Ltd. (Foreign)**.......... 3,606,625 2,396,339
Siam Commercial Bank (Pref.)
(Foreign)**............... 560,000 797,312
Telecom Asia Corp. Public
Co. Ltd. (Foreign)**...... 1,196,000 1,208,199
------------
12,609,454
------------
SINGAPORE -- 4.9%
City Developments, Ltd. .... 660,610 4,229,531
Datacraft Asia, Ltd. ....... 610,000 2,659,600
Natsteel Electronics,
Ltd. ..................... 347,800 1,521,971
Singapore Press Holdings,
Ltd. ..................... 234,000 3,985,973
------------
12,397,075
------------
HONG KONG -- 4.5%
China Shipping Development
Co, Ltd.**................ 5,534,000 1,276,757
China Telecom, Ltd.**....... 1,750,000 4,860,729
Cosco Pacific, Ltd. ........ 1,571,000 1,306,026
Television Broadcasts,
Ltd....................... 106,000 497,306
Wharf Holdings, Ltd. ....... 1,062,000 3,312,501
Yizheng Chemical Fibre Co.,
Ltd.**.................... 534,000 139,374
------------
11,392,693
------------
PHILIPPINES -- 1.9%
Belle Corp.**............... 11,914,500 1,268,205
Benpres Holdings Corp.**.... 4,655,700 1,101,250
Metropolitan Bank & Trust
Co. ...................... 255,645 2,553,168
------------
4,922,623
------------
INDONESIA -- 1.0%
PT Telekomunikasi
Indonesia -- ADR.......... 203,866 2,535,586
------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
TAIWAN -- 0.5%
Synnex Technology
International
Corp. -- GDR.............. 55,375 $ 1,251,475
------------
AUSTRALIA -- 0.0%
AAPT, Ltd.**................ 39,260 122,139
------------
INDIA -- 0.0%
Infosys Technologies,
Ltd....................... 1,200 100,360
------------
Total Far East.............. 103,888,138
------------
NORTH AMERICA -- 9.1%
MEXICO -- 5.5%
Carso Global Telecom**...... 602,705 3,808,496
Cifra SA de CV -- V**....... 1,191,100 2,284,445
Corporacion Interamericana
de Entretenimiento SA --
B**....................... 77 250
Fomento Economico Mexicano
SA de CV -- ADR........... 61,347 2,446,212
Grupo Televisa
SA -- GDR**............... 124,072 5,559,976
------------
14,099,379
------------
UNITED STATES -- 2.8%
Amdocs, Ltd.**.............. 65,967 1,500,749
Global Telesystems Group,
Inc.**.................... 69,288 5,612,328
------------
7,113,077
------------
CANADA -- 0.8%
Canadian Hunter Exploration,
Ltd.**.................... 135,820 2,032,643
------------
Total North America......... 23,245,099
------------
SOUTH AMERICA -- 4.5%
BRAZIL -- 4.5%
Companhia Vale do Rio Doce
(Pref.) -- A.............. 113,839 2,260,150
Embratel Participacoes SA --
ADR....................... 82,668 1,147,018
Tele Sudeste Celular
Participacoes SA -- ADR... 71,520 2,074,080
Telecommunicacoes
Brasileiras SA (Pref.) --
ADR....................... 23,305 2,101,820
Telecommunicacoes de Sao
Paulo SA (Pref.).......... 7,300,465 866,774
Telesp Celular
Participacoes -- ADR...... 110,248 2,949,134
------------
11,398,976
------------
Total South America......... 11,398,976
------------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
4
<PAGE> 8
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
MIDDLE EAST -- 1.5%
ISRAEL -- 1.5%
Backweb Technologies,
Ltd.**.................... 15,022 $ 411,227
Check Point Software
Technologies, Ltd.**...... 62,907 3,373,388
------------
3,784,615
------------
Total Middle East........... 3,784,615
------------
AFRICA -- 1.1%
SOUTH AFRICA -- 1.1%
Liberty International
PLC**..................... 37,103 245,639
Liberty Life Association Of
Africa, Ltd............... 79,585 1,019,489
Standard Bank Investment
Corp., Ltd................ 508,315 1,680,535
------------
2,945,663
------------
Total South Africa.......... 2,945,663
------------
Total Equity Securities
(Cost $198,136,211)....... 252,824,992
------------
WARRANTS -- 0.1%
- ----------------------------------------------------------
THAILAND -- 0.1%
Siam Commercial Bank --
Warrants (Foreign)**...... 560,000 $ 360,689
------------
Total Warrants (Cost $0).... 360,689
------------
- ----------------------------------------------------------
TOTAL INVESTMENTS (COST
$198,136,211)............... 98.9% 253,185,681
Other Assets in Excess of
Liabilities................. 1.1% 2,756,500
---------- ------------
Net Assets...................... 100.0% $255,942,181
==========================================================
The federal income tax basis and unrealized appreciation
(depreciation) for all securities is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis.................................... $198,136,211
============
Gross Appreciation....................... $ 58,882,806
Gross Depreciation....................... (3,833,336)
------------
Net Appreciation..................... $ 55,049,470
============
</TABLE>
** Non-income producing security
+ Restricted Security (Note E).
Notes to Financial Statements are an integral part of this Schedule.
5
<PAGE> 9
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Banking................................ 10.1%
Beverages.............................. 1.0%
Broadcast & Publishing Services........ 11.4%
Business & Publishing Services......... 1.0%
Chemicals.............................. 0.1%
Consumer Services / Multi-Industry..... 1.1%
Cosmetics.............................. 1.2%
Electrical & Electronics............... 1.5%
Electronic Components.................. 5.1%
Electronic Systems / Devices........... 5.0%
Finance / Multi-Industry............... 0.4%
Financial Services..................... 0.6%
Industrial Services.................... 1.3%
Information Technology................. 0.6%
Insurance.............................. 0.4%
Investments............................ 0.9%
Leisure & Tourism...................... 0.5%
Machinery & Engineering................ 4.3%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Merchandising.......................... 4.5%
Metals -- Nonferrous................... 0.9%
Oil.................................... 0.8%
Other Computers........................ 0.1%
Real Estate............................ 3.0%
Retailing -- Foods..................... 1.4%
Retailing -- Goods..................... 2.0%
Software............................... 2.2%
Software & EDP Services................ 4.2%
Technology / Multi-Industry............ 0.2%
Telecommunications..................... 24.5%
Telephone Utilities.................... 5.5%
Textiles & Apparel..................... 2.6%
Transportation -- Shipping............. 0.5%
Other Assets In Excess Of
Liabilities.......................... 1.1%
------
TOTAL.................................. 100.0%
======
</TABLE>
Notes to Financial Statements are an integral part of this Schedule
6
<PAGE> 10
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $198,136,211)........ $253,185,681
Foreign currency (Cost $456,678)........................ 456,557
Cash.................................................... 6,271,022
Receivables:
Dividends.......................................... 571,340
Interest........................................... 3,299
Investment securities sold......................... 3,727,998
Fund shares sold................................... 775,398
Prepaid expenses........................................ 29,972
Deferred organizational costs........................... 57,193
------------
- ----------------------------------------------------------------------------
TOTAL ASSETS................................... 265,078,460
------------
- ----------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 8,464,551
Fund shares redeemed............................... 271,550
Due to affiliates.................................. 304,741
Net unrealized depreciation on unsettled foreign
currency
forward contracts from transaction hedges........ 5,000
Accrued expenses........................................ 90,437
------------
- ----------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 9,136,279
------------
- ----------------------------------------------------------------------------
NET ASSETS.................................................. $255,942,181
============
SHARES OUTSTANDING.......................................... 19,638,220
============
NET ASSET VALUE PER SHARE................................... $ 13.03
============
============================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 1999:
Paid-in capital......................................... $199,244,264
Undistributed net investment loss....................... (414,967)
Undistributed net realized gain......................... 3,307,695
Undistributed net realized foreign exchange loss........ (1,197,121)
Unrealized foreign exchange loss........................ (47,160)
Unrealized appreciation on investments.................. 55,049,470
------------
NET ASSETS..................................... $255,942,181
============
============================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement
7
<PAGE> 11
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (Net of non-reclaimable foreign taxes of
$109,003)......................................... $ 1,606,801
Interest........................................... 124,199
-----------
- -------------------------------------------------------------------------------
Total income..................................... 1,731,000
-----------
- -------------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 1,747,731
Administration fee................................. 139,576
Professional fees.................................. 59,950
Federal and state registration fees................ 10,316
Custodian fee...................................... 108,942
Transfer agent fees................................ 21,762
Trustees' fees..................................... 9,867
Amortization of organization costs................. 12,581
Miscellaneous...................................... 35,242
-----------
- -------------------------------------------------------------------------------
Total expenses................................... 2,145,967
-----------
- -------------------------------------------------------------------------------
Net investment loss............................ (414,967)
-----------
- -------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions............ 11,951,667
Net realized foreign exchange loss...................... (1,197,121)
Net change in unrealized foreign exchange loss.......... (26,210)
Change in unrealized appreciation of investments........ 19,259,029
-----------
- -------------------------------------------------------------------------------
Net gain on investments........................ 29,987,365
- -------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $29,572,398
===========
===============================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement
8
<PAGE> 12
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the six month period
January 1, 1999 For the four month period
through September 1, 1998 For the year
June 30,1999 through ended
(unaudited) December 31, 1998 August 31, 1998
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment loss........................ $ (414,967) $ (1,002,935) $ (1,202,312)
Net realized and unrealized gain (loss) on
investments.............................. 29,987,365 (5,124,573) 30,640,370
------------ ------------ ------------
- ---------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
resulting from operations............ 29,572,398 (6,127,508) 29,438,058
------------ ------------ ------------
- ---------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income...................... -- -- --
Capital gains.............................. -- (9,922,354) (18,667,191)
------------ ------------ ------------
Total distributions to shareholders.... -- (9,922,354) (18,667,191)
------------ ------------ ------------
- ---------------------------------------------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold.................. 84,115,273 58,317,866 86,666,536
Reinvestment of distributions.............. -- 9,838,003 18,666,482
Cost of shares redeemed.................... (81,576,704) (57,363,037) (67,560,735)
------------ ------------ ------------
Net increase in net assets derived from
capital share transactions........... 2,538,569 10,792,832 37,772,283
------------ ------------ ------------
Total increase (decrease) in net
assets............................... 32,110,967 (5,257,030) 48,543,150
------------ ------------ ------------
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
- ---------------------------------------------------------------------------------------------------------------------------
Beginning of period............................ $223,831,214 $229,088,244 $180,545,094
------------ ------------ ------------
End of period.................................. $255,942,181 $223,831,214 $229,088,244
============ ============ ============
===========================================================================================================================
Capital share transactions are as follows:
Shares issued.............................. 6,936,228 5,245,917 6,694,016
Shares reinvested.......................... -- 909,243 1,840,876
Shares redeemed............................ (6,683,220) (5,254,104) (5,222,930)
------------ ------------ ------------
Net increase from capital share
transactions......................... 253,008 901,056 3,311,962
============ ============ ============
===========================================================================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement
9
<PAGE> 13
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The Table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.
<TABLE>
<CAPTION>
For the period
For the six from the
month period For the four commencement
January 1, 1999 month period of operations
through September 1, 1998 For the year October 28, 1996
June 30, 1999 through ended through
(unaudited) December 31, 1998 August 31, 1998 August 31, 1997
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset value, beginning of
period............................ $ 11.55 $ 12.39 $ 11.90 $ 10.00
-------- -------- -------- --------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment loss............... (0.02) (0.04) (0.07) (0.05)
Net gains (losses) on investments
(both realized and
unrealized)..................... 1.50 (0.25) 1.77 1.95
-------- -------- -------- --------
Total income (loss) from
investment operations.... 1.48 (0.29) 1.70 1.90
-------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net investment
income.......................... -- -- -- --
Distributions from capital
gains........................... -- (0.55) (1.21) --
-------- -------- -------- --------
Total distributions........ -- (0.55) (1.21) --
-------- -------- -------- --------
Net asset value, end of period...... $ 13.03 $ 11.55 $ 12.39 $ 11.90
======== ======== ======== ========
Total Return............... 12.81%** (2.04)%** 16.50% 19.00%**
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
000's).......................... $255,942 $223,831 $229,088 $180,545
Ratio of expenses to average net
assets.......................... 1.84%* 2.00%* 1.88% 2.11%*+
Ratio of net investment loss to
average net assets.............. (0.36)%* (1.46)%* (0.54)% (0.67)%*+
Portfolio turnover................ 150.01%** 116.28%** 219.78% 380.02%**
Annualized portfolio turnover..... 302.51% 347.89% 219.78% 450.35%
</TABLE>
- --------------------------------------------------------------------------------
* Annualized
** Not Annualized
+ Such ratios are after transfer agent waivers. PFPC Inc., the transfer agent,
waived a portion of its fee for the first ten months of the Funds operations.
Notes to Financial Statements are an integral part of this Schedule.
10
<PAGE> 14
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND - PORTFOLIO MANAGER'S LETTER
- --------------------------------------------------------------------------------
Dear Fellow Shareholders:
We're pleased to have the opportunity to share with you this report on the
performance of the Driehaus International Discovery Fund during its first six
months of activity. The fund was opened with the primary objective of achieving
capital appreciation by investing in international stocks with a market
capitalization of less than $1 billion. From the fund's inception through June
30, 1999, the Driehaus International Discovery Fund returned 42.00%. This
compares with a return of 3.97% for the Morgan Stanley Capital International
Europe, Australia, Far East Index and 17.80% for the Lipper International Small
Cap Fund Index for the first six months of 1999.
At the beginning of the year, the fund was heavily weighted in Europe to
take advantage of the strength in the European markets. During the first
quarter, however, we shifted the majority of our investments into Southeast
Asian markets -- specifically South Korea, Thailand, Singapore, and the
Philippines -- as well as Japan, based on data showing economic acceleration and
improving conditions there. The fund's performance during the first half of 1999
was largely the result of the foresight of that decision.
Within Asia, we believe some of the best opportunities exist in economically
sensitive, consumer-oriented stocks, and we have weighted the portfolio
accordingly. In Japan particularly, where banking reform and a growing appetite
for corporate restructuring signal economic recovery, we have taken advantage of
the rebound in consumer spending and invested in several companies with
excellent growth prospects and better-than-expected earnings reports. These
included:
- - Don Quijote Co., Ltd., the fund's largest holding as of June 30, 1999,
operates a chain of discount convenience stores that stay open late at night.
These stores sell electronics, groceries, watches, and a wide assortment of
consumer products. We expect the company's consolidated sales growth of 85% to
be sustained as the company continues to open new stores.
- - Ryohin Keikaku Co., Ltd., a clothing retailer, is benefiting from young
Japanese consumers' increased demand for lower-priced, trendy fashions. In
addition to an Internet-based mail order service, the company is currently
developing a chain of retail outlets in the country's railroad stations and
planning the opening of large-scale stores in Japan as well as overseas
outlets.
- - Drake Beam Morin - Japan, Inc. provides outplacement services to individuals
affected by the recent wave of restructurings in Japan. With a 30% market
share, Drake has strong projected sales through 2001.
We have also invested heavily in technology, holding stocks such as
Datacraft Asia Limited (Singapore), Korea Data System and Trigem Computer, Inc.
(South Korea). These companies benefit from a boom in retail demand for personal
computers and the dramatic growth of the Internet across Asia. Substantial
potential for future growth exists, as technology investment in Japan has a long
way to go to catch up with U.S. and European spending levels. Another investment
theme during the first half of 1999 involved natural resources. The rebound in
commodity prices has had a major impact on the economies of Latin America and
the emerging markets, where we believe many stocks are currently undervalued.
Investments in resource-related stocks such as Tubos de Acero de Mexico SA and
Tatneft in Russia enabled the fund to participate in the recovery of these
markets.
Although we made the substantial shift into Southeast Asian and Japanese
markets during the first quarter, approximately 25% of the fund remained
invested in Western Europe, where computer and related services companies have
shown strong growth in terms of price appreciation and earnings. Given this, the
fund has focused on plays in European software, technology, and semiconductor
stocks. At the same time, we continued to watch developments in Eastern European
markets, which had provided a safe haven during last year's crisis in Asia and
Latin America. This year, however, lower growth projections for Eastern European
trading partners across the rest of Europe began to hurt these export-driven
economies. Among the stocks we sold was ComputerLand SA of Poland, based on
lower-than-expected earnings and loss of market share.
11
<PAGE> 15
In our view, the recovery in Southeast Asia, Japan, and the emerging markets
seems quite solid, and we intend to maintain our exposure to these regions.
Brighter economic prospects in Europe look set to provide an interesting
opportunity, and we plan to shift some assets back to European markets. We thank
you for your support during the fund's first six months, and we look forward to
reporting to you again at the end of the year.
Sincerely,
<TABLE>
<S> <C>
Emery R. Brewer LOGO
Emery R. Brewer Lynette Schroeder
Portfolio Manager Portfolio Manager
August 25, 1999 August 25, 1999
</TABLE>
12
<PAGE> 16
DRIEHAUS INTERNATIONAL DISCOVERY FUND
TOTAL RETURN
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DRIEHAUS INTERNATIONAL LIPPER INTERNATIONAL
DISCOVERY MSCI EAFE SMALL CAP
FUND (DIDF) INDEX FUND INDEX
---------------------- --------- --------------------
<S> <C> <C> <C>
For the Period 12/31/98 (since inception)
through 6/30/99 42.00% 3.97% 17.80%
</TABLE>
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you sell
shares.
<TABLE>
<CAPTION>
DIDF MSCI EAFE INDEX LIPPER
---- --------------- INTERNATIONAL SMALL
CAP FUNDS INDEX
-------------------
<S> <C> <C> <C>
Dec 1998 10,000.00 10,000.00 10,000.00
Mar 1999 10,880.00 10,139.00 10,375.00
Jun 1999 14,200.00 10,397.00 11,780.00
</TABLE>
Performance data presented measures change in the value of an investment in
the Fund, assuming reinvestment of all dividends and capital gains.
The graph compares the results of a $10,000 investment in the Fund, since
December 31, 1998, (the date of the Fund's commencement of operations), with all
dividends and capital gains reinvested, with the Morgan Stanley Capital
International (MSCI) EAFE Index with dividends reinvested and the Lipper
International Small Cap Fund Index with reinvested dividends for the same
period.
The EAFE Index (MSCI Europe, Australia and Far East Index) is a widely
recognized benchmark of non-U.S. stock markets. It is an unmanaged index
composed of a sample of companies representative of the market structure of 20
European and Pacific Basin countries. Data is in U.S. dollars. Source: Morgan
Stanley Capital International.
The Lipper International Small Cap Fund Index is an equally weighted managed
index of the 10 largest qualifying funds that invest in at least 65% of assets
in equity securities of non-United States companies with a market capitalization
of less than $1 billion at time of purchase. Data is in U.S. dollars. Source:
Lipper Analytical Services.
13
<PAGE> 17
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 94.2%
- ----------------------------------------------------------
FAR EAST -- 54.0%
JAPAN -- 20.5%
Aruze Corp.................... 1,000 $ 98,318
Aucnet, Inc................... 1,800 113,024
Avex, Inc..................... 1,000 156,152
Bellsystem 24, Inc............ 300 122,567
Don Quijote Co., Ltd.......... 1,100 276,736
Drake Beam Morin-Japan,
Inc......................... 1,000 85,099
Fast Retailing Co., Ltd....... 2,100 225,552
Hikari Tsushin, Inc........... 400 123,599
KDD Corp...................... 1,100 78,976
Mycal Card, Inc............... 2,200 99,970
Round One Corp................ 25 175,361
Ryohin Keikaku Co., Ltd....... 600 150,947
Toyo Information Systems Co.,
Ltd......................... 2,000 65,765
Zuken, Inc.................... 4,000 87,742
----------
1,859,808
----------
AUSTRALIA -- 7.4%
AAPT, Ltd.**.................. 33,500 104,219
Computershare, Ltd............ 13,000 153,418
MYOB, Ltd**................... 74,074 98,062
Pacifica Group, Ltd........... 19,000 77,974
Powertel, Ltd.**.............. 45,000 53,913
Solution 6 Holdings, Ltd.**... 45,000 104,253
Strathfield Group, Ltd........ 22,100 38,034
Travel. Com. Au, Ltd.**....... 47,000 42,932
----------
672,805
----------
SINGAPORE -- 7.0%
Datacraft Asia, Ltd........... 43,000 187,480
GES International, Ltd........ 175,000 189,137
Pacific Internet, Ltd.**...... 1,070 50,691
Singapore Bus Services,
Ltd......................... 50,000 79,884
Star Cruises PLC.............. 27,000 120,420
----------
627,612
----------
HONG KONG -- 6.2%
City Telecom, Ltd............. 206,000 64,386
Dah Sing Financial Group...... 23,600 89,885
Giordano International,
Ltd......................... 200,000 141,778
Quality Healthcare Asia,
Ltd.**...................... 530,000 103,150
Shun Tak Holdings, Ltd........ 3,428 917
Yizheng Chemical Fibre Co.,
Ltd.**...................... 600,000 156,600
----------
556,716
----------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
THAILAND -- 5.1%
Regional Container Line Public
Co., Ltd.**................. 42,000 $ 68,341
Seamico Securities Public Co.,
Ltd......................... 50,000 150,513
Siam Commercial Bank (Pref.)
(Foreign)**................. 114,300 162,737
United Communication Industry
Public Co., Ltd.**.......... 75,000 83,901
----------
465,492
----------
PHILIPPINES -- 3.9%
Belle Corp.**................. 830,000 88,347
Benpres Holdings Corp.**...... 320,000 75,692
Equitable Banking Corp........ 45,425 118,192
SPI Technologies, Inc......... 150,000 72,933
----------
355,164
----------
SOUTH KOREA -- 3.0%
Korea Data System............. 2,500 73,004
Lotte Confectionery Co........ 670 105,930
Trigem Computer, Inc.......... 2,300 89,420
----------
268,354
----------
MALAYSIA -- 0.9%
Genting Berhad................ 21,000 80,132
----------
80,132
----------
Total Far East................ 4,886,083
----------
EUROPE -- 25.2%
GERMANY -- 4.5%
Kamps AG...................... 3,900 156,856
PrimaCom AG**................. 3,000 137,674
SER Systeme AG................ 1,998 116,417
----------
410,947
----------
FINLAND -- 4.1%
JOT Automation Group Oyj...... 4,320 175,084
Teleste Oyj**................. 10,000 90,752
Tieto Oyj -- B................ 2,615 108,949
----------
374,785
----------
FRANCE -- 3.3%
Beneteau...................... 620 116,368
GFI Informatique.............. 1,200 79,078
Infogrames Entertainment
SA**........................ 1,535 98,937
----------
294,383
----------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
14
<PAGE> 18
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
SWITZERLAND -- 2.3%
Also Holdings................. 162 $ 87,430
Kudelski SA**................. 34 121,383
----------
208,813
----------
UNITED KINGDOM -- 2.0%
Psion PLC..................... 8,725 112,776
Trafficmaster PLC**........... 10,400 71,557
----------
184,333
----------
GREECE -- 1.7%
Athens Medical Care SA........ 3,840 95,723
Interamerican SA.............. 340 7,607
Intrasoft SA.................. 1,870 50,386
----------
153,716
----------
ITALY -- 1.6%
Class Editori SpA............. 18,200 145,460
----------
POLAND -- 1.6%
Elektrim Spolka Akcyjna SA.... 10,000 141,460
----------
HUNGARY -- 1.6%
Gedeon Richter -- GDR......... 1,950 84,692
Synergon Information
Systems**................... 4,840 56,030
----------
140,722
----------
SWEDEN -- 1.1%
Framtidsfabriken AB**......... 5,000 98,803
----------
RUSSIA -- 0.7%
Tatneft -- ADR................ 17,000 63,750
----------
BELGIUM -- 0.7%
Real Software................. 525 61,397
Real Software -- VVPR
Strips**.................... 125 5
----------
61,402
----------
Total Europe.................. 2,278,574
----------
NORTH AMERICA -- 7.4%
MEXICO -- 3.9%
Biper SA -- B**............... 600,000 114,314
Controladora Comercial
Mexicana SA de CV........... 82,000 86,099
Corporacion Interamericana de
Entretenimiento SA**........ 23,000 74,616
Tubos de Acero de Mexico SA --
ADR......................... 7,500 81,563
----------
356,592
----------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
UNITED STATES -- 3.5%
Star Media Network, Inc.**.... 1,800 $ 115,425
Viatel, Inc.**................ 3,640 204,295
----------
319,720
----------
Total North America........... 676,312
----------
SOUTH AMERICA -- 3.9%
BRAZIL -- 3.9%
Gerdau Metalurgica SA
(Pref.)..................... 3,000,000 89,681
Globex Utilidades SA
(Pref.)..................... 500 2,609
Industrias Klabin de Papel e
Celulose SA**............... 300,000 150,596
Tele Centro Oeste Celular
Participacoes SA -- ADR..... 16,000 63,000
Telemig Celular Participacoes
SA -- ADR................... 1,800 44,325
----------
350,211
----------
Total South America........... 350,211
----------
MIDDLE EAST -- 2.7%
ISRAEL -- 2.7%
BackWeb Technologies,
Ltd.**...................... 4,334 118,643
Sapiens International Corp.
NV**........................ 5,300 52,669
TTI Team Telecom
International, Ltd.**....... 7,500 75,000
----------
246,312
----------
Total Middle East............. 246,312
----------
AFRICA -- 1.0%
SOUTH AFRICA -- 1.0%
Specialised Outsourcing,
Ltd......................... 13,281 92,878
----------
Total Africa.................. 92,878
- ----------------------------------------------------------
TOTAL INVESTMENTS (COST
$6,063,317)................... 94.2% $8,530,370
Other Assets in Excess of
Liabilities................... 5.8% 523,075
--------- ----------
Net Assets 100.0% $9,053,445
==========================================================
The federal income tax basis and unrealized appreciation
(depreciation) for all securities is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis...................................... $6,063,317
==========
Gross Appreciation......................... $2,525,610
Gross Depreciation......................... (58,557)
----------
Net Appreciation....................... $2,467,053
==========
</TABLE>
** Non-income producing security.
Notes to Financial Statements are an integral part of this Schedule.
15
<PAGE> 19
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Automotive Manufacturing............... 1.9%
Banking................................ 3.1%
Broadcast & Publishing Services........ 2.9%
Business & Publishing Services......... 0.7%
Chemicals.............................. 1.7%
Computer Manufacturers................. 4.7%
Consumer Services/Multi-Industry....... 0.9%
Data Processing........................ 1.0%
Drugs.................................. 0.9%
Electrical & Electronics............... 1.6%
Electronic Components.................. 3.0%
Electronic Systems/Devices............. 3.4%
Finance/Multi-Industry................. 0.8%
Financial Services..................... 4.8%
Foods & Household Products............. 1.2%
Forest Products........................ 1.7%
Health Care............................ 2.2%
Insurance.............................. 0.1%
Laser & Color Printing................. 0.8%
Leisure................................ 4.3%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Leisure Products....................... 1.3%
Leisure & Tourism...................... 3.2%
Machinery & Engineering................ 0.9%
Merchandising.......................... 5.4%
Metal Fabrication & Distribution....... 0.9%
Metals -- Steel........................ 1.0%
Office/Communications Equipment........ 1.0%
Oil.................................... 0.7%
Retailing -- Foods..................... 2.7%
Retailing -- Goods..................... 6.4%
Software & EDP Services................ 12.4%
Technology/Multi-Industry.............. 3.1%
Telecommunications..................... 9.1%
Transportation/Multi-Industry.......... 1.7%
Transportation Shipping................ 0.8%
Utilities/Multi-Industry............... 1.9%
Other Assets In Excess Of
Liabilities.......................... 5.8%
------
TOTAL.................................. 100.0%
======
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
16
<PAGE> 20
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $6,063,317).......... $8,530,370
Cash.................................................... 410,260
Receivables:
Dividends.......................................... 3,502
Interest........................................... 172
Investment securities sold......................... 333,403
Net unrealized appreciation on unsettled foreign
currency forward contracts from transaction
hedges............................................. 604
Prepaid expenses........................................ 18,650
----------
- --------------------------------------------------------------------------
TOTAL ASSETS................................... 9,296,961
----------
- --------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 212,805
Due to affiliates.................................. 6,889
Accrued expenses........................................ 23,822
----------
- --------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 243,516
----------
- --------------------------------------------------------------------------
NET ASSETS.................................................. $9,053,445
==========
SHARES OUTSTANDING.......................................... 637,630
==========
NET ASSET VALUE PER SHARE................................... $ 14.20
==========
==========================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 1999:
Paid-in capital......................................... $6,380,010
Undistributed net investment loss....................... (32,097)
Undistributed net realized gain......................... 256,491
Undistributed net realized foreign exchange loss........ (17,187)
Unrealized foreign exchange loss........................ (825)
Unrealized appreciation on investments.................. 2,467,053
----------
NET ASSETS..................................... $9,053,445
==========
==========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
17
<PAGE> 21
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (Net of non-reclaimable foreign taxes of
$1,545)............................................ $ 44,704
Interest........................................... 8,785
----------
- --------------------------------------------------------------------------
Total income..................................... 53,489
----------
- --------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 51,755
Administration fee................................. 57,000
Professional fees.................................. 25,016
Federal and state registration fees................ 4,874
Custodian fee...................................... 23,235
Transfer agent fees................................ 18,092
Trustees' fees..................................... 2,891
Miscellaneous...................................... 8,684
----------
Total expenses before fees waived and
reimbursements..................................... 191,547
----------
- --------------------------------------------------------------------------
Administration fee waived.......................... (52,169)
Transfer agent fees waived......................... (15,600)
Expense reimbursement from advisor................. (38,192)
----------
Total expenses net of fees waived and
reimbursements................................... 85,586
----------
- --------------------------------------------------------------------------
Net investment loss............................ (32,097)
----------
- --------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions............ 256,491
Net realized foreign exchange loss...................... (17,187)
Net change in unrealized foreign exchange loss.......... (825)
Change in unrealized appreciation of investments........ 2,467,053
----------
- --------------------------------------------------------------------------
Net gain on investments........................ 2,705,532
- --------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $2,673,435
==========
==========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
18
<PAGE> 22
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment loss..................................... $ (32,097)
Net realized and unrealized gain on investments......... 2,705,532
----------
- -------------------------------------------------------------------------------
Net increase in net assets resulting from
operations........................................ 2,673,435
----------
- -------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income................................... --
Capital gains........................................... --
----------
Total distributions to shareholders................ --
----------
- -------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold............................... 6,380,000
Reinvestment of distributions........................... --
Cost of shares redeemed................................. --
----------
Net increase in net assets derived from capital
share transactions................................ 6,380,000
----------
Total increase in net assets....................... 9,053,435
----------
- -------------------------------------------------------------------------------
NET ASSETS:
- -------------------------------------------------------------------------------
Beginning of period....................................... $ 10
----------
End of period............................................. $9,053,445
==========
===============================================================================
Capital share transactions are as follows:
Shares issued............................................. 637,629
Shares reinvested......................................... --
Shares redeemed........................................... --
----------
Net increase from capital share transactions....... 637,629
==========
===============================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
19
<PAGE> 23
- --------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
FINANCIAL HIGHLIGHTS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
The Table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.
<TABLE>
<S> <C>
Net Asset value, beginning of period........................ $10.00
------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment loss....................................... (0.05)
Net gains (losses) on investments (both realized and
unrealized)............................................. 4.25
------
Total income (loss) from investment operations..... 4.20
------
LESS DISTRIBUTIONS:
Dividends from net investment income...................... --
Distributions from capital gains.......................... --
------
Total distributions................................ --
------
Net asset value, end of period.............................. $14.20
======
Total Return....................................... 42.00%**
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000's)...................... $9,053
Ratio of expenses to average net assets................... 2.48%*+
Ratio of net investment loss to average net assets........ (0.93)%*+
Portfolio turnover........................................ 144.15%**
Annualized portfolio turnover............................. 297.26%
</TABLE>
- --------------------------------------------------------------------------------
* Annualized
** Not Annualized
+ Such ratios are after administrative agent and transfer agent waivers and
Adviser expense reimbursements. PFPC Inc., the administrative agent and
transfer agent, waived a portion of its fees. The Adviser agreed to absorb
other operating expenses to the extent necessary to ensure that the total fund
operating expenses (other than interest, taxes, brokerage commissions and
other portfolio transaction expenses, capital expenditures, and extraordinary
expenses) will not exceed the fund's operating expense cap for the first
seventeen months of its operations. For the period from December 31, 1998 (the
commencement of operations) through May 31, 1999 the Fund's operating expense
cap was 2.50% of average net assets. For the period June 1, 1999 through May
31, 2000 the operating expense cap has been reduced to 2.40% of average net
assets.
Notes to Financial Statements are an integral part of this schedule.
20
<PAGE> 24
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND -- PORTFOLIO MANAGER'S LETTER
- --------------------------------------------------------------------------------
Dear Fellow Shareholders:
We are pleased to share with you this report detailing the first six months
of performance for the Driehaus European Opportunity Fund. The fund was opened
with the primary objective of achieving capital appreciation by investing in
European equities. From the fund's inception through June 30, 1999, the Driehaus
European Opportunity Fund returned 8.30%. This compares with a return of -2.41%
for the Morgan Stanley Capital International Europe Index and 0.71% for the
Lipper European Fund Index for the first six months of 1999.
Following a strong start to the year, European stock markets have been weak,
largely as the result of declining economic conditions across the region. During
the first six months of 1999, the price performance of growth-oriented stocks
languished, while cyclical stocks and value-oriented investments stormed ahead.
Despite this, we maintained the fund's objective and continued to invest in
growth stocks. A number of stocks in the computer and related services areas
demonstrated good earnings growth and strong price appreciation. While the
demand for Internet stocks has produced many investment opportunities in the
U.S., the lower penetration rate of personal computers within Europe has created
a smaller number of Internet-related companies in that region. Given that,
companies providing access to the Internet or software services for firms
interested in starting or expanding electronic commerce ventures, or
Internet-related businesses, have shown strong growth. Typical of the fund's
investments in this area are the UK-based Easynet Group PLC, which provides
Internet access and on-line services to British and continental web users, and
FI System, a small French company that offers website creation services to
businesses.
Another important trend in the first half was the apparent trough in the
semiconductor cycle, the recovery of demand for semiconductor chips, and the
corresponding increase in capital expenditures by semiconductor manufacturers.
The ostensible end of the downturn created a number of investment opportunities
in companies such as ASM Lithography Holding NV in the Netherlands and ST
Microelectronics in France, both heavily exposed to the semiconductor cycle.
Despite the slowdown in European economic growth, advertising spending
bucked the trend, driven by the introduction of new automobiles, development of
new products by financial services companies, and deregulation in the
telecommunications industry. To benefit from this trend, the fund held
investments in NRJ SA, a French radio company, as well as Publicis SA, a French
advertising company; both participated in the upswing in advertising revenues.
From a country perspective, the fund held a relatively high weighting in
French stocks based on the fact that French economic growth has not slowed to
the degree experienced by other European countries. In addition, the fund had a
large weighting in the UK market because the economic slowdown there was not as
dramatic as anticipated. In fact, the UK has shown clear signs of economic
recovery. Our smaller weighting in Italy and reduced exposure to Germany reflect
the fact that these two markets have been the most heavily and negatively
impacted by deteriorating economic conditions.
During the first half, the fund sold positions in several German software
and information technology services companies. The impending millennium has
created a great degree of uncertainty surrounding the rates at which
corporations will disburse their information technology budgets. This
uncertainty has resulted in greater risk in the shares of software companies.
Given the high valuation of stocks such as Cenit Systemhaus AG and PSI AG
Gesellschaft, we opted to sell those stocks and reinvest the proceeds into areas
that we believe offer more promise.
21
<PAGE> 25
Although we lack clear-cut evidence of economic recovery in Europe,
indicators suggest decline has slowed and may be beginning to bottom. Current
expectations are that Europe will see some economic recovery in the second half
of 1999, driven largely by the strength of consumer spending and an increase in
exports prompted by the weak euro. The recoveries in Asia and Latin America
should also contribute to a European revival. In this environment, we anticipate
that these markets should continue to perform well. Thank you for your support
during the fund's first six months.
Sincerely,
Lynette Schroeder
Lynette Schroeder
Portfolio Manager
August 25, 1999
22
<PAGE> 26
DRIEHAUS EUROPEAN OPPORTUNITY FUND
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
TOTAL RETURN
- -----------------------------------------------------------------------------------------------------------
DRIEHAUS EUROPEAN
OPPORTUNITY LIPPER EUROPEAN
FUND (DEOF) MSCI EUROPE INDEX REGION FUND INDEX
----------------- ----------------- -----------------
<S> <C> <C> <C>
For the Period 12/31/98 (since inception)
through 6/30/99 8.30% -2.41% 0.71%
- -----------------------------------------------------------------------------------------------------------
</TABLE>
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you sell
shares.
<TABLE>
<CAPTION>
LIPPER EUROPEAN
DEOF MSCI EUROPE INDEX REGION FUNDS INDEX
---- ----------------- ------------------
<S> <C> <C> <C>
Dec 1998 10,000.00 10,000.00 10,000.00
Mar 1999 10,420.00 9,789.00 9,908.00
Jun 1999 10,830.00 9,759.00 10,071.00
</TABLE>
Performance data presented measures change in the value of an investment in
the Fund, assuming reinvestment of all dividends and capital gains.
The graph compares the results of a $10,000 investment in the Fund, since
December 31, 1998, (the date of the Fund's commencement of operations), with all
dividends and capital gains reinvested, with the Morgan Stanley Capital
International (MSCI) Europe Index with dividends reinvested and the Lipper
European Region Fund Index with dividends reinvested for the same period.
The MSCI Europe Index is a recognized benchmark of European stock markets.
It is an unmanaged index of a sample of companies representative of the market
structure of 15 European countries. Data is in U.S. dollars. Source: Morgan
Stanley Capital International.
The Lipper European Region Fund Index is an equally weighted managed index
of the 30 largest qualifying funds that invest in equity securities with primary
trading markets or operations concentrated in the European region or a single
country within this region. Data is in U.S. dollars. Source: Lipper Analytical
Services.
23
<PAGE> 27
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 96.4%
- ----------------------------------------------------------
EUROPE -- 93.6%
FRANCE -- 27.9%
ALTEN**..................... 1,400 $ 87,493
Altran Technologies SA...... 281 74,185
Beneteau.................... 450 84,461
Brice SA.................... 1,800 99,311
Coflexip SA................. 1,090 93,580
FI System**................. 2,975 137,754
Galeries Lafayette.......... 680 89,972
GFI Informatique............ 1,200 79,078
Infogrames Entertainment
SA**...................... 1,305 84,113
Intercall**................. 2,400 72,519
Louis Vuitton Moet
Hennessy.................. 315 92,225
Neopost SA**................ 3,550 82,372
NRJ SA...................... 515 115,940
Publicis SA................. 400 84,564
Sidel SA.................... 684 83,165
SPIR Communication.......... 1,560 114,545
ST Microelectronics......... 1,650 109,923
------------
1,585,200
------------
GERMANY -- 17.8%
CE Computer Equipment
AG**...................... 450 73,323
Edel Music AG**............. 795 59,850
EM. TV & Merchandising AG... 100 145,409
Intershop Communications
AG**...................... 500 120,143
Kamps AG.................... 3,000 120,658
MobilCom AG................. 895 82,146
PrimaCom AG**............... 3,460 158,784
SER Systeme AG.............. 1,632 95,091
Tecis Holding AG**.......... 885 83,966
Telegate AG**............... 2,100 71,900
------------
1,011,270
------------
UNITED KINGDOM -- 16.8%
COLT Telecom Group PLC --
ADR**..................... 965 83,352
Diagonal PLC................ 16,000 86,381
Easynet Group PLC**......... 9,670 83,454
Eidos PLC**................. 3,750 123,246
Future Network PLC**........ 5,000 33,299
Pace Micro Technology PLC... 34,850 111,241
Photo-Me International
PLC....................... 4,600 49,669
Psion PLC................... 5,275 68,182
Racal Electronics PLC....... 11,000 67,016
Sage Group PLC.............. 4,075 144,847
Trafficmaster PLC**......... 14,800 101,832
------------
952,519
------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
FINLAND -- 7.3%
JOT Automation Group Oyj.... 4,200 $ 170,221
Nokia Corp. -- ADR.......... 965 91,562
Teleste Oyj**............... 8,000 72,601
Tieto Oyj -- B.............. 1,925 80,202
------------
414,586
------------
ITALY -- 6.2%
Autogrill SpA............... 5,625 57,951
Class Editori SpA........... 13,800 110,294
Gruppo Editoriale
L'Espresso................ 6,000 97,145
Seat Pagine Gialle SpA...... 100,000 85,080
------------
350,470
------------
BELGIUM -- 3.6%
Netvision NV**.............. 1,675 64,517
Real Software............... 1,180 137,996
Real Software -- VVPR
Strips**.................. 90 4
------------
202,517
------------
NETHERLANDS -- 3.4%
ASM Lithography Holding
NV-ADR**.................. 1,910 113,406
BE Semiconductor Industries
NV**...................... 7,680 79,993
------------
193,399
------------
SWEDEN -- 3.3%
Framtidsfabriken AB**....... 5,000 98,803
Modern Times Group MTG
AB -- B**................. 4,250 92,231
------------
191,034
------------
SPAIN -- 3.3%
Indra Sistemas SA........... 8,000 86,214
Telefonica Publicidad e
Informacion SA**.......... 5,000 99,775
------------
185,989
------------
SWITZERLAND -- 2.6%
Also Holdings............... 108 58,287
Kudelski SA**............... 25 89,252
------------
147,539
------------
DENMARK -- 1.4%
NEG Micon A/S............... 2,320 82,261
------------
Total Europe................ 5,316,784
------------
NORTH AMERICA -- 2.8%
UNITED STATES -- 2.8%
Viatel, Inc.**.............. 2,885 161,921
------------
Total North America......... 161,921
------------
Total Equity Securities
(Cost $4,607,037)......... 5,478,705
------------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
24
<PAGE> 28
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
RIGHTS -- 0.2%
- ----------------------------------------------------------
FRANCE -- 0.2%
Louis Vuitton Moet Hennessy
-- Rights**............... 315 $ 9,209
------------
Total Rights (Cost $0)...... 9,209
------------
- ----------------------------------------------------------
TOTAL INVESTMENTS (COST
$4,607,037)................. 96.6% 5,487,914
Other Assets in Excess of
Liabilities................. 3.4% 195,271
---------- ------------
Net Assets...................... 100.0% $ 5,683,185
==========================================================
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
The federal income tax basis and unrealized appreciation
(depreciation) for all securities is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis...................................... $4,607,037
==========
Gross Appreciation......................... $ 932,498
Gross Depreciation......................... (51,621)
----------
Net Appreciation....................... $ 880,877
==========
</TABLE>
** Non-income producing security.
Notes to Financial Statements are an integral part of this Schedule.
25
<PAGE> 29
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Automotive Manufacturing............... 3.0%
Broadcast & Publishing Services........ 15.7%
Business & Publishing Services......... 1.5%
Electrical & Electronics............... 1.4%
Electronic Components.................. 4.6%
Electronic Systems/Devices............. 3.2%
Energy Equipment....................... 1.6%
Investment............................. 1.5%
Leisure Products....................... 1.5%
Leisure & Tourism...................... 0.9%
Machinery.............................. 1.5%
Machinery & Engineering................ 1.5%
Merchandising.......................... 1.1%
Office/Communications Equipment........ 1.0%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Photo Optical Equipment................ 2.0%
Retailing -- Foods..................... 3.1%
Retailing -- Goods..................... 3.4%
Semiconducter/Components............... 1.9%
Software & EDP Services................ 22.6%
Technology/Multi-Industry.............. 7.7%
Telecommunications..................... 8.3%
Transportation/Multi-Industry.......... 3.1%
Textile & Apparel...................... 1.7%
Utilities/Multi-Industry............... 2.8%
Other Assets In Excess Of
Liabilities.......................... 3.4%
------
TOTAL.................................. 100.0%
======
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
26
<PAGE> 30
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $4,607,037).......... $5,487,914
Foreign currency (Cost $308,875)........................ 308,875
Cash.................................................... 143,758
Receivables:
Dividends.......................................... 4,934
Interest........................................... 133
Investment securities sold......................... 283,563
Due from affiliates................................ 738
Net unrealized appreciation on unsettled foreign
currency forward contracts
from transaction hedges.......................... 173
Prepaid expenses........................................ 18,656
----------
- --------------------------------------------------------------------------
TOTAL ASSETS................................... 6,248,744
----------
- --------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 547,137
Accrued expenses........................................ 18,422
----------
- --------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 565,559
----------
- --------------------------------------------------------------------------
NET ASSETS.................................................. $5,683,185
==========
SHARES OUTSTANDING.......................................... 524,731
==========
NET ASSET VALUE PER SHARE................................... $ 10.83
==========
==========================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 1999:
Paid-in capital......................................... $5,279,010
Undistributed net investment loss....................... (3,427)
Undistributed net realized loss......................... (478,576)
Unrealized net realized foreign exchange gain........... 5,711
Unrealized foreign exchange loss........................ (410)
Unrealized appreciation on investments.................. 880,877
----------
NET ASSETS..................................... $5,683,185
==========
==========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
27
<PAGE> 31
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (Net on non-reclaimable foreign taxes of
$2,524)............................................ $ 42,878
Interest........................................... 8,252
---------
- -------------------------------------------------------------------------
Total Income..................................... 51,130
---------
- -------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 38,969
Administration fee................................. 57,000
Professional fees.................................. 18,918
Federal and state registration fees................ 4,567
Custodian fees..................................... 14,325
Transfer agent fees................................ 18,081
Trustees' fees..................................... 2,782
Miscellaneous...................................... 8,585
---------
- -------------------------------------------------------------------------
Total expenses before fees waived and
reimbursements..................................... 163,227
---------
Administration fee waived.......................... (53,363)
Transfer agent fees waived......................... (15,600)
Expense reimbursement from advisor................. (39,707)
---------
Total expenses net of fees waived and
reimbursements................................... 54,557
---------
- -------------------------------------------------------------------------
Net investment loss............................ (3,427)
---------
- -------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss from security transactions............ (478,576)
Net realized foreign exchange gain...................... 5,711
Net change in unrealized foreign exchange loss.......... (410)
Change in unrealized appreciation of investments........ 880,877
---------
- -------------------------------------------------------------------------
Net gain on investments........................ 407,602
---------
- -------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $ 404,175
=========
=========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
28
<PAGE> 32
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment loss................................. $ (3,427)
Net realized and unrealized gain on investments..... 407,602
----------
- --------------------------------------------------------------------------------------
Net increase in net assets resulting from
operations..................................... 404,175
----------
- --------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income............................... --
Capital gains....................................... --
----------
Total distributions to shareholders............. --
----------
- --------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold........................... 5,279,000
Reinvestment of distributions....................... --
Cost of shares redeemed............................. --
----------
Net increase in net assets derived from capital
share transactions............................. 5,279,000
----------
Total increase in net assets.................... 5,683,175
----------
- --------------------------------------------------------------------------------------
NET ASSETS:
- --------------------------------------------------------------------------------------
Beginning of period..................................... $ 10
----------
End of period........................................... $5,683,185
==========
======================================================================================
Capital share transactions are as follows:
Shares issued....................................... 524,730
Shares reinvested................................... --
Shares redeemed..................................... --
----------
Net increase from capital share transactions.... 524,730
==========
======================================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
29
<PAGE> 33
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
FINANCIAL HIGHLIGHTS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
The Table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.
<TABLE>
<S> <C>
Net asset value, beginning of period........................ $ 10.00
--------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment loss....................................... (0.01)
Net gains (losses) on investments (both realized and
unrealized)............................................. 0.84
--------
Total income from investment operations............ 0.83
--------
LESS DISTRIBUTIONS:
Dividends from net investment income...................... --
Distributions from capital gains.......................... --
--------
Total distributions................................ --
--------
Net asset value, end of period.............................. $ 10.83
========
Total Return....................................... 8.30%**
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000's)...................... $ 5,683
Ratio of expenses to average net assets................... 2.10%*+
Ratio of net investment loss to average net assets........ (0.13)%*+
Portfolio turnover........................................ 125.20%**
Annualized portfolio turnover............................. 258.18%
</TABLE>
- --------------------------------------------------------------------------------
* Annualized
** Not Annualized
+ Such ratios are after administrative agent and transfer agent waivers and
Adviser expense reimbursements. PFPC Inc., the administrative agent and
transfer agent, waived a portion of its fees. The Adviser agreed to absorb
other operating expenses to the extent necessary to ensure that the total
fund operating expenses (other than interest, taxes, brokerage commissions
and other portfolio transaction expenses, capital expenditures, and
extraordinary expenses) will not exceed the fund's operating expense cap for
the first seventeen months of its operations. For the period from December
31, 1998 (the commencement of operations) through May 31, 2000 the Fund's
operating expense cap will be 2.10% of average net assets.
Notes to Financial Statements are an integral part of this Schedule.
30
<PAGE> 34
- --------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND -- PORTFOLIO MANAGER'S LETTER
- --------------------------------------------------------------------------------
Dear Fellow Shareholders:
For the period from January 1, 1999, through June 30, 1999, the Driehaus
Asia Pacific Growth Fund returned 71.11%. This compares with a return of 26.75%
for the Morgan Stanley Capital International Asia Pacific Index and 32.78% for
the Lipper Pacific Region Fund Index for the first six months of 1999. Since the
fund's inception on January 1, 1998, the Driehaus Asia Pacific Growth Fund
posted an annualized return of 42.10%, compared with the MSCI Asia Pacific
Index's 18.70% and the Lipper Pacific Region Fund Index's 18.42% over the same
period.
The fund's performance over the most recent six-month period was achieved
due to a strong recovery in Asian markets as well as our early realization of
the potential of such a recovery. For the 12 months ending June 30, 1999, the
Driehaus Asia Pacific Growth Fund was ranked 1st out of 52 funds in the Lipper
Pacific Region Funds category.* Since the beginning of 1999, the combination of
strong gross domestic product growth, low interest rates, and increased fiscal
spending has boosted economic growth in countries across Asia. Two primary
examples of this are South Korea, where GDP grew by 4.6% in the first quarter of
1999, and Japan, which saw its GDP jump 7.9% on an annualized basis.
Further proof of the firm footing of the Asian recovery can be found in
additional statistics from the region:
- - In May, South Korean unemployment fell to 6.2% from a peak of 8.7% in
February, as industrial production rose 22% and companies hired more workers.
- - In Thailand, the restructuring of bad debts increased to $12 billion in May,
or 16% of non-performing loans, following the passage of a new bankruptcy bill
in March.
- - Export growth continues to recover, especially in Singapore and Taiwan, where
exports increased 15% and 14%, respectively, in May. Southeast Asia's exports
to Japan rose 8.0% in the first quarter of 1999, compared with 0.4% in the
fourth quarter of 1998.
In recent years, foreign investors -- skeptical about the Japanese
government's willingness to take the actions necessary to fix its
economy -- have underweighted the Japanese market. Now, however, the Obuchi
government and the country's corporate sector seem to be changing their
strategy. For example, Japan recently cut its corporate tax rate from 52% to 41%
and the top individual tax rate from 65% to 50%. The government also established
a new independent financial supervisory agency to oversee the cleanup of the
banking system and provided US$500 billion, or 13% of the country's GDP, to fund
the effort. These momentous changes have gone largely unrecognized by investors
in the United States.
The Japanese system of lifetime employment now also appears to be over, with
an increasing number of listed Japanese companies announcing unprecedented job
cuts in an effort to boost sagging profits. Return on equity, rather than merely
sales growth, has become a major goal for many of the country's companies.
However, we have chosen to invest in companies that are growing their businesses
in the most dynamic part of the economy, rather than in pure restructuring plays
that often occur in more mature, lower growth sectors.
During the first half of 1999, in fact, the fund trimmed some of its
holdings in Japan, which remained our largest country weighting as of the end of
June, in order to increase its exposure to markets in Southeast Asia. Over this
period, we continued to find new investments across Asia that exhibited rapid
sales and earnings growth, including:
- - Fast Retailing Co., Ltd., a Japanese retailer of casual clothing, which
reported a 57% increase in recurring profits on the back of a 28% jump in
sales during 1998. The increasing popularity of low-priced, trendy clothing in
Japan was largely responsible for this growth.
- - Trigem Computer Inc., a South Korean manufacturer of personal computers that
launched a new line of PCs called E-machines in 1998. E-machines, which are
priced in the $400-600 range, have sold very well in the larger U.S. retail
chains, and overall sales growth in 1999 is projected to top 100%.
- ---------------
* The Fund's total return for the period from 6/30/98 through 6/30/99 was ranked
1 out of 52 funds by Lipper Analytical Services, Inc. in the Lipper Pacific
Region Funds category. During the period, the adviser waived a portion of the
Fund's expenses; otherwise the ranking may have been lower.
31
<PAGE> 35
- - Hitron Technology, Inc., a Taiwanese telecommunications equipment provider,
which is the third largest Internet service provider in that country.
One stock that we sold during the first half was Data Advantage Ltd., an
Australian credit checking company. Although the demand for credit checks
continues to rise, the company's new software division underperformed our
expectations.
During the first six months of 1999, we increased our weighting in the
technology sector based on rapid growth in personal computer sales and data
networking equipment for the Internet. In 1999, PC sales in Japan are projected
to grow by 25% -- the first increase in three years -- based on a boom in retail
demand. Daiwabo Information System Co., Ltd., a PC wholesaler, recently reported
a 71% increase in recurring profits, while electronics retailer Kojima Co.
increased its recurring profits by 192% last year. Although we don't expect
growth to continue at this pace, Japan is currently so far behind in its
investment in technology that the potential for growth remains substantial. One
indication of the extent of that potential can be found in recent estimates
showing that Internet and PC penetration in Japan is only 11% and 25%,
respectively, compared with 28% and 50% in the United States. Currently,
approximately 14 million Japanese are Internet subscribers, versus 70 million
Americans. We expect this gap to narrow in 2000 when NTT Mobile Communications
Network, Inc., the Japanese telephone company, introduces its unlimited Internet
access service.
We are extremely pleased with the recent performance of the fund, and we
plan to further capitalize on the economic recovery in Asia as it continues to
create opportunities to find rapidly growing new companies in which to invest.
Sincerely,
Eric J. Ritter
Eric J. Ritter
Portfolio Manager
August 25, 1999
32
<PAGE> 36
DRIEHAUS ASIA PACIFIC GROWTH FUND
AVERAGE ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DRIEHAUS ASIA LIPPER PACIFIC
PACIFIC GROWTH MSCI ASIA REGION FUND
FUND (DAPGF) PACIFIC INDEX INDEX
-------------- ------------- --------------
<S> <C> <C> <C>
One Year ended 6/30/99 99.30% 39.65% 45.13%
Since Inception (1/1/98 -- 6/30/99) 42.10% 18.70% 18.42%
</TABLE>
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you sell
shares.
<TABLE>
<CAPTION>
LIPPER PACIFIC REGION
DAPF MSCI ASIA PACIFIC INDEX FUND INDEX
---- ----------------------- ---------------------
<S> <C> <C> <C>
Dec 1997 10,000.00 10,000.00 10,000.00
Mar 1998 9,950.00 10,282.00 10,975.00
Jun 1998 8,500.00 8,880.00 8,277.00
Sept 1998 8,300.00 8,081.00 7,557.00
Dec 1998 9,900.00 9,705.00 9,524.00
Mar 1999 12,160.00 10,443.00 10,361.00
Jun 1999 16,940.00 12,887.00 13,241.00
</TABLE>
Performance data presented measures change in the value of an investment in
the Fund, assuming reinvestment of all dividends and capital gains. Average
annual total return reflects annualized change.
The graph compares the results of a $10,000 investment in the Fund, since
December 31, 1997, (the date of the Fund's commencement of operations), with all
dividends and capital gains reinvested, with the Morgan Stanley Capital
International (MSCI) Asia Pacific Index with dividends reinvested and the Lipper
Pacific Region Fund Index with dividends reinvested for the same period.
The MSCI Asia Pacific Index is a recognized benchmark of Asian and Pacific
Basin stock markets. It is an unmanaged index of a sample of companies
representative of the market structure of 15 Asian and Pacific Basin countries.
Data is in U.S. dollars. Source: Morgan Stanley Capital International.
The Lipper Pacific Region Fund Index is an equally weighted managed index of
the 10 largest qualifying funds that invest in securities with primary trading
markets concentrated in the Western Pacific Basin or a single country within
this region. Data is in U.S. dollars. Source: Lipper Analytical Services.
33
<PAGE> 37
- --------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 97.5%
- ----------------------------------------------------------
FAR EAST -- 97.5%
JAPAN -- 45.0%
Aruze Corp. ................... 2,000 $ 196,635
C Two-Network Co., Ltd. ....... 1,000 156,978
Chugai Pharmaceutical Co.,
Ltd. ........................ 6,000 64,642
Cresco, Ltd. .................. 2,000 114,016
Daiwabo Information System Co.,
Ltd. ........................ 10,000 147,064
Don Quijote Co., Ltd. ......... 1,600 402,524
Enix Corp. .................... 1,500 65,435
Fancl Corp. ................... 300 54,529
Fast Retailing Co., Ltd. ...... 2,300 247,034
Fuji Bank, Ltd. ............... 9,000 62,758
Fuji Television Network,
Inc. ........................ 15 81,050
Fujisawa Pharmaceutical Co.,
Ltd. ........................ 3,000 48,828
Fujitsu, Ltd. ................. 3,000 60,354
Fujitsu Support & Service,
Inc.......................... 1,000 151,360
Happinet Corp. ................ 2,000 99,144
Hikari Tsushin, Inc............ 1,500 463,498
Hirose Electric Co., Ltd. ..... 1,400 145,279
Hitachi Software Engineering
Co., Ltd. ................... 2,200 109,058
Kojima Co., Ltd. .............. 2,400 79,910
Kyorin Pharmaceutical Co.,
Ltd. ........................ 4,000 99,474
Mabuchi Motor Co., Ltd. ....... 1,000 92,947
Matsushita Communication
Industrial Group Co.,
Ltd. ........................ 2,000 142,933
Meiwa Estate Co., Ltd. ........ 2,300 95,963
Miroku Jyoho Service Co.,
Ltd. ........................ 3,000 47,837
Mitsumi Electric Co., Ltd. .... 3,000 83,777
Murata Manufacturing Co.,
Ltd. ........................ 2,000 131,531
Mycal Card, Inc. .............. 1,900 86,338
Nichii Gakkan Co. ............. 1,500 163,588
Nidec Corp. ................... 500 75,225
NTT Mobile Communications
Network, Inc. ............... 15 203,245
Pasona Softbank, Inc. ......... 2,000 68,409
Ryohin Keikaku Co., Ltd. ...... 600 150,947
Shin-Etsu Chemical Co.,
Ltd. ........................ 3,000 100,383
Softbank Corp. ................ 800 162,001
Takefuji Corp. ................ 700 72,350
Tokyo Seimitsu Co., Ltd. ...... 1,600 101,920
Tomy Co., Ltd. ................ 1,200 76,638
-----------
4,705,602
-----------
HONG KONG -- 11.3%
Cosco Pacific, Ltd. ........... 126,000 104,748
First Pacific Co., Ltd. ....... 44,145 37,553
Giordano International,
Ltd. ........................ 336,000 238,187
Henderson Land Development Co.,
Ltd. ........................ 11,000 63,233
Johnson Electric Holdings,
Ltd. ........................ 34,000 140,231
Legend Holdings, Ltd. ......... 114,000 109,466
Li & Fung, Ltd. ............... 21,000 50,344
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
HONG KONG (CON'T)
Pacific Century Insurance
Holdings, Ltd.** ............ 38,000 $ 30,758
Quality Healthcare Asia,
Ltd.**....................... 874,000 170,100
Shun Tak Holdings, Ltd. ....... 2,753 736
Television Broadcasts, Ltd. ... 21,000 98,523
Yizheng Chemical Fibre Co.,
Ltd. -- H** ................. 522,000 136,242
-----------
1,180,121
-----------
SINGAPORE -- 8.6%
CSE Systems & Engineering,
Ltd.** ...................... 89,000 92,530
Datacraft Asia, Ltd. .......... 40,000 174,400
GES International, Ltd. ....... 80,000 86,463
Natsteel Electronics, Ltd. .... 12,500 54,700
Pacific Century Regional
Developments, Ltd.** ........ 13,000 55,361
Singapore Press Holdings,
Ltd.......................... 5,000 85,170
Star Cruises PLC .............. 59,000 263,140
Venture Manufacturing, Ltd. ... 12,000 92,336
-----------
904,100
-----------
TAIWAN -- 7.9%
Acer Peripherals, Inc. ........ 74,300 184,031
Far Eastern Textile, Ltd.**.... 49,000 72,820
GVC Corp.**.................... 119,000 65,949
Hitron Technology, Inc.**...... 30,000 118,425
Quanta Computer, Inc. ......... 5,040 60,388
Silicon Integrated Systems**... 24,000 115,917
Synnex Technology International
Corp. ....................... 11,700 60,856
Systex Corp.** ................ 24,000 68,733
United World Chinese Commercial
Bank......................... 52,000 80,498
-----------
827,617
-----------
AUSTRALIA -- 7.7%
AAPT, Ltd.**................... 31,145 96,893
Aristocrat Leisure, Ltd. ...... 10,655 80,754
Cochlear, Ltd. ................ 9,300 73,846
Computershare, Ltd. ........... 24,900 293,854
MYOB, Ltd.**................... 88,889 117,675
Pacifica Group, Ltd. .......... 631 2,590
Solution 6 Holdings, Ltd.** ... 41,000 94,985
Travel.Com.Au, Ltd.**.......... 50,000 45,672
-----------
806,269
-----------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
34
<PAGE> 38
- --------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
SOUTH KOREA -- 6.1%
Comtec System Co., Ltd......... 10,000 $ 88,556
Kookmin Bank................... 3,500 71,060
Korea Data System.............. 3,042 88,859
Korea Telecom Corp. -- ADR**... 1,000 40,000
L.G. Electronics............... 2,900 80,175
Samsung Corp. ................. 3,000 70,499
Samsung Electronics**.......... 51 5,596
Trigem Computer, Inc........... 5,000 194,391
-----------
639,136
-----------
THAILAND -- 5.7%
Advanced Info Service Public
Co., Ltd. (Foreign)**........ 13,000 176,277
BEC World Public Co., Ltd.
(Local)...................... 8,000 49,466
Land and House Public Co., Ltd.
(Foreign)**.................. 68,000 123,556
National Finance Public Co.,
Ltd. (Foreign)**............. 131,200 79,167
Siam Commercial Bank (Pref.)
(Foreign)**.................. 65,000 92,545
Telecom Asia Corp. Public Co.,
Ltd. (Foreign)**............. 71,000 71,724
-----------
592,735
-----------
PHILIPPINES -- 4.2%
Belle Corp.**.................. 700,000 74,509
Filinvest Land, Inc.**......... 800,000 90,410
International Container
Terminal Services, Inc.**.... 516,000 67,130
La Tondena Distillers,
Inc.**....................... 100,000 118,269
SPI Technologies, Inc.......... 189,000 91,895
-----------
442,213
-----------
INDONESIA -- 0.6%
PT Telekomunikasi Indonesia --
ADR.......................... 5,400 67,163
-----------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
INDIA -- 0.4%
ITC, Ltd. -- GDR............... 1,570 $ 43,960
-----------
Total Far East..................... 10,208,916
-----------
Total Equity Securities (Cost
$7,034,392)...................... 10,208,916
-----------
RIGHTS/WARRANTS -- 0.7%
- ----------------------------------------------------------
SOUTH KOREA -- 0.1%
Samsung Securities Co., Ltd. --
Rights**..................... 372 7,713
-----------
THAILAND -- 0.6%
Siam Commercial Bank --
Warrants (Foreign)**......... 100,000 64,409
-----------
Total Rights / Warrants (Cost
$0).............................. 72,122
-----------
- ----------------------------------------------------------
TOTAL INVESTMENTS (COST
$7,034,392).................... 98.2% $10,281,038
Other Assets in Excess of
Liabilities.................... 1.8% 185,302
-----------
Net Assets......................... 100.0% $10,466,340
==========================================================
The federal income tax basis and unrealized appreciation
(depreciation) for all securities is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis...................................... $7,034,392
==========
Gross Appreciation......................... $3,284,757
Gross Depreciation......................... (38,111)
----------
Net Appreciation....................... $3,246,646
==========
</TABLE>
** Non-income producing security.
Notes to Financial Statements are an integral part of this Schedule.
35
<PAGE> 39
- --------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Banking................................ 2.8%
Beverages & Tobacco.................... 1.1%
Broadcast & Publishing Services........ 2.5%
Business & Publishing Services......... 4.4%
Chemicals.............................. 2.3%
Computer Manufacturers................. 6.7%
Consumer Services/Multi-Industry....... 2.9%
Cosmetics.............................. 0.5%
Drugs.................................. 2.0%
Electrical & Electronics............... 5.0%
Electronic Components.................. 5.0%
Electronic Systems/Devices............. 4.2%
Finance & Loan......................... 0.7%
Financial Services..................... 1.7%
Food Processors........................ 1.4%
Health Care............................ 1.6%
Insurance.............................. 0.3%
International Trading.................. 1.2%
Investments............................ 0.5%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Leisure................................ 4.4%
Leisure Products....................... 0.7%
Leisure & Tourism...................... 1.9%
Medical Supplies....................... 0.7%
Merchandising.......................... 6.7%
Office/Communications Equipment........ 2.6%
Real Estate............................ 3.5%
Retailing -- Goods..................... 7.0%
Savings & Loans........................ 0.8%
Software & EDP Services................ 9.6%
Technology/Multi-Industry.............. 1.1%
Telecommunications..................... 10.0%
Telephone Utilities.................... 0.7%
Textiles & Apparel..................... 0.7%
Tobacco................................ 0.4%
Transportation -- Shipping............. 0.6%
Other Assets In Excess Of
Liabilities.......................... 1.8%
------
TOTAL.................................. 100.0%
======
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
36
<PAGE> 40
- --------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $7,034,392).......... $ 10,281,038
Foreign currency (Cost $205,720)........................ 206,064
Cash.................................................... 263,629
Receivables:
Dividends.......................................... 1,535
Interest........................................... 198
Investment securities sold......................... 327,330
Fund shares sold................................... 25,000
Prepaid expenses........................................ 20,916
Deferred organizational costs........................... 20,532
------------
- ----------------------------------------------------------------------------
TOTAL ASSETS................................... 11,146,242
------------
- ----------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 649,041
Due to affiliates.................................. 5,713
Net unrealized depreciation on unsettled foreign
currency forward contracts from transaction
hedges............................................ 11
Accrued expenses........................................ 25,137
------------
- ----------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 679,902
------------
- ----------------------------------------------------------------------------
NET ASSETS.................................................. $ 10,466,340
============
SHARES OUTSTANDING.......................................... 617,734
============
NET ASSET VALUE PER SHARE................................... $ 16.94
============
============================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 1999:
Paid-in capital......................................... $ 6,051,428
Undistributed net investment loss....................... (52,727)
Undistributed net realized gain......................... 1,284,621
Undistributed net realized foreign exchange loss........ (63,998)
Unrealized foreign exchange gain........................ 370
Unrealized appreciation on investments.................. 3,246,646
------------
NET ASSETS..................................... $ 10,466,340
============
============================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
37
<PAGE> 41
- --------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (Net of non-reclaimable foreign taxes of
$3,729)........................................... $ 35,354
Interest........................................... 7,367
----------
- -------------------------------------------------------------------------------
Total income..................................... 42,721
----------
- -------------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 51,497
Administration fee................................. 57,000
Professional fees.................................. 16,033
Federal and state registration fees................ 2,894
Custodian fee...................................... 25,524
Transfer agent fees................................ 18,105
Trustees' fees..................................... 1,658
Amortization of organization costs................. 2,903
Miscellaneous...................................... 12,785
----------
- -------------------------------------------------------------------------------
Total expenses before fees waived and
reimbursements.................................... 188,399
----------
Administration fee waived.......................... (52,194)
Transfer agent fees waived......................... (15,600)
Expense reimbursement from adviser................. (25,157)
----------
Total expenses net of fees waived and
reimbursements................................... 95,448
----------
- -------------------------------------------------------------------------------
Net investment loss............................ (52,727)
----------
- -------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions............ 1,794,888
Net realized foreign exchange loss...................... (63,998)
Net change in unrealized foreign exchange gain.......... 1,058
Change in unrealized appreciation of investments........ 2,377,357
----------
- -------------------------------------------------------------------------------
Net gain on investments........................ 4,109,305
- -------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $4,056,578
==========
===============================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
38
<PAGE> 42
- --------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the period
from the
For the six month period commencement
January 1, 1999 For the three month period of operations
through October 1, 1998 December 31, 1997
June 30,1999 through through
(unaudited) December 31, 1998 September 30, 1998
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment loss..................... $ (52,727) $ (20,191) $ (8,979)
Net realized and unrealized gain (loss)
on investments........................ 4,109,305 792,901 (630,577)
----------- ---------- ----------
- ----------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets resulting from
operations........................ 4,056,578 772,710 (639,556)
----------- ---------- ----------
- ----------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income................... -- -- --
Capital gains........................... -- -- --
----------- ---------- ----------
Total distributions to
shareholders...................... -- -- --
----------- ---------- ----------
- ----------------------------------------------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold............... 3,228,000 610,000 4,318,619
Reinvestment of distributions........... -- -- --
Cost of shares redeemed................. (1,783,141) -- (96,870)
----------- ---------- ----------
Net increase in net assets derived
from capital share transactions... 1,444,859 610,000 4,221,749
----------- ---------- ----------
Total increase in net assets........ 5,501,437 1,382,710 3,582,193
----------- ---------- ----------
- ----------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
- ----------------------------------------------------------------------------------------------------------------------------
Beginning of period......................... $ 4,964,903 $3,582,193 $ --
----------- ---------- ----------
End of period............................... $10,466,340 $4,964,903 $3,582,193
=========== ========== ==========
============================================================================================================================
Capital share transactions are as follows:
Shares issued........................... 285,880 69,795 442,994
Shares reinvested....................... -- -- --
Shares redeemed......................... (169,558) -- (11,377)
----------- ---------- ----------
Net increase from capital share
transactions...................... 116,322 69,795 431,617
=========== ========== ==========
============================================================================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
39
<PAGE> 43
- --------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The Table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.
<TABLE>
<CAPTION>
For the period
from the
For the six month period commencement
January 1, 1999 For the three month period of operations
through October 1, 1998 December 31, 1997
June 30, 1999 through through
(unaudited) December 31, 1998 September 30, 1998
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset value, beginning of period............ $ 9.90 $ 8.30 $ 10.00
------- ------- -------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment loss......................... (0.09) (0.04) (0.02)
Net gains (losses) on investments (both
realized and unrealized).................. 7.13 1.64 (1.68)
------- ------- -------
Total income (loss) from investment
operations............................ 7.04 1.60 (1.70)
------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income........ -- -- --
Distributions from capital gains............ -- -- --
------- ------- -------
Total distributions..................... -- -- --
------- ------- -------
Net asset value, end of period.................. $ 16.94 $ 9.90 $ 8.30
======= ======= =======
Total Return............................ 71.11%** 19.28%** (17.00)%**
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000's)........ $10,466 $ 4,965 $ 3,582
Ratio of expenses to average net assets..... 2.78%*+ 2.95%*+ 2.95%*+
Ratio of net investment loss to average net
assets.................................... (1.54)%*+ (2.64)%*+ (0.45)%*+
Portfolio turnover.......................... 204.99%** 92.40%** 283.59%**
Annualized portfolio turnover............... 413.38% 366.60% 379.16%
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Annualized.
** Not Annualized.
+ Such ratios are after administrative agent and transfer agent waivers and
Adviser expense reimbursements. PFPC Inc., the administrative agent and
transfer agent, waived a portion of its fees. The Adviser agreed to absorb
other operating expenses to the extent necessary to ensure that the total
fund operating expenses (other than interest, taxes, brokerage commissions
and other portfolio transaction expenses, capital expenditures, and
extraordinary expenses) will not exceed the fund's operating expense cap for
the first twenty-nine months of its operations. For the period from December
31, 1997 (the commencement of operations) through May 31, 1999 the Fund's
operating expense cap was 2.95% of average net assets. For the period June 1,
1999 through May 31, 2000 the operating expense cap has been reduced to 2.50%
of average net assets.
Notes to Financial Statements are an integral part of this schedule.
40
<PAGE> 44
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND -- PORTFOLIO MANAGER'S LETTER
- --------------------------------------------------------------------------------
Dear Fellow Shareholders:
For the period from January 1, 1999, through June 30, 1999, the Driehaus
Emerging Markets Growth Fund returned 40.09%. This compares with a return of
42.29% for the Morgan Stanley Capital Emerging Markets Index and 35.10% for the
Lipper Emerging Markets Fund Index for the first six months of 1999. Since the
fund's inception on January 1, 1998, the Driehaus Emerging Markets Growth Fund
posted an annualized return of 14.36%, compared with the MSCI Emerging Markets
Index's 6.08% and the Lipper Emerging Markets Fund Index's -0.80% over the same
period.
During the first half of 1999, emerging markets continued to recover from
last year's global financial crisis, driven by the faster-than-expected
turnaround in Asia. Beginning in the first quarter of the year, Asian economies
started to come to life, led by countries like South Korea, where gross domestic
product growth far exceeded expectations by reaching 4.6%. As interest rates
dropped dramatically across the region, currencies strengthened, consumer
spending picked up pace, and export growth -- particularly in the electronics
sector -- became robust. As exports outnumbered imports, current account
surpluses continued to improve, reflecting the greater amount of cash coming
into these markets. With almost 45% of the fund invested in Asia, up from 26% at
the end of 1998, the fund benefited from strong weightings in rebounding markets
such as South Korea, Taiwan, Thailand, Hong Kong, and the Philippines.
From a sector perspective, we have overweighted the technology sector based
on the dramatic acceleration in demand for Internet access and data transfer
systems across the emerging markets, concentrating on strong export-driven
growth companies such as:
- - Datacraft Asia, Ltd. (Singapore), the fund's largest holding as of June 30,
1999, builds telecommunication, network, and Internet infrastructure
throughout Asia and the U.S. The company is benefiting from increased demand
in Asia, expanding product lines, and strong ties with Cisco Systems, Inc.,
which is looking to gain market share in global networking.
- - Asustek Computer, Inc. (Taiwan) is the world's largest motherboard
manufacturer, most notably for Intel's Pentium product line. Projections are
for strong revenue growth through 2002 based on growing global demand.
- - Korea Data Systems (South Korea) is co-owner -- with Trigem Computer, Inc. of
South Korea, another of our holdings -- of E-machines, the third largest
distributor of personal computers in the U.S. KDS provides the monitors for
these low-cost PCs, which have been experiencing strong sales.
In addition to our Asian technology holdings, the fund also has positions in
several European-based technology companies, including Optimus SA, Poland's
largest manufacturer of personal computers and owner of one of the country's
leading internet portal sites. Overall, however, we reduced our exposure to
European equities, from approximately 28% at the end of 1998 to about 15% as of
June 30, 1999. As mentioned earlier, this was primarily the result of the
earnings opportunities we saw in Asian markets during first quarter 1999, versus
the general economic slowdown that has impacted Europe this year. Among the
stocks we sold were ComputerLand SA of Poland, on the basis of
lower-than-expected earnings and loss of market share, and Prokom Software, also
in Poland, which experienced a decline in its order backlog.
Another sector theme we pursued during the first half of 1999 involved the
natural resources sector, particularly companies that benefited from the higher
prices of oil, pulp, and paper. Among the stocks added to the fund were the
Russian oil company LUKoil Holdings, the Mexican oil service company Tubcs de
Acero de Mexico SA, and Sasol Ltd., a South African oil company. In the pulp and
paper area, we purchased Sappi Ltd. (South Africa) and Aracruz Celulose SA
(Brazil).
41
<PAGE> 45
While the emerging markets continue to trade below the highs they achieved
in 1992, we believe the long-term trend for these economies is very positive.
Although a sell-off in Asian markets during the second half is always a
possibility, Asia seems to have rounded the corner to recovery very decisively,
the decline in Europe appears to be slowing, and the strong rebound in commodity
prices could mean better times ahead for emerging markets.
Sincerely,
Emery R. Brewer
Emery R. Brewer
Portfolio Manager
August 25, 1999
42
<PAGE> 46
DRIEHAUS EMERGING MARKETS GROWTH FUND
AVERAGE ANNUAL TOTAL RETURN
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DRIEHAUS EMERGING
MARKETS GROWTH MSCI EMERGING LIPPER EMERGING
FUND (DEMGF) MARKETS INDEX MARKETS FUND INDEX
----------------- ------------- ------------------
<S> <C> <C> <C>
One Year ended 6/30/99 28.47% 33.52% 19.04%
Since Inception (1/1/98 -- 6/30/99) 14.36% 6.08% -0.80%
</TABLE>
Performance is historical and does not represent future results. Investment
returns and principal value vary, and you may have a gain or loss when you sell
shares.
<TABLE>
<CAPTION>
MSCI EMERGING LIPPER EMERGING
DEMGF MARKETS INDEX MARKETS FUND INDEX
----- ------------- ------------------
<S> <C> <C> <C>
Dec 1997 10,000.00 10,000.00 10,000.00
Mar 1998 10,550.00 10,722.00 10,512.00
Jun 1998 9,520.00 8,183.00 8,300.00
Sept 1998 7,560.00 6,504.00 6,331.00
Dec 1998 8,730.00 7,679.00 7,313.00
Mar 1999 9,380.00 7,089.00 6,553.00
Jun 1999 12,230.00 10,926.00 9,880.00
</TABLE>
Performance data presented measures change in the value of an investment in
the Fund, assuming reinvestment of all dividends and capital gains. Average
annual total return reflects annualized change.
The graph compares the results of a $10,000 investment in the Fund, since
December 31, 1997, (the date of the Fund's commencement of operations), with all
dividends and capital gains reinvested, with the Morgan Stanley Capital
International (MSCI) Emerging Markets Index with dividends reinvested and the
Lipper Emerging Markets Fund Index with dividends reinvested for the same
period.
The MSCI Emerging Markets Index is a recognized benchmark of Emerging
Markets stock markets. It is an unmanaged index of a sample of companies
representative of the market structure of 26 Emerging Markets countries. Data is
in U.S. dollars. Source: Morgan Stanley Capital International.
The Lipper Emerging Markets Fund Index is an equally weighted managed index
of the 30 largest qualifying funds. Funds in this index seek long-term capital
appreciation by investing at least 65% of their total assets in emerging market
equity securities, where "emerging markets" is defined by a country's per-capita
GNP or other economic measure. Data is in U.S. dollars. Source: Lipper
Analytical Services.
43
<PAGE> 47
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 96.7%
- ----------------------------------------------------------
FAR EAST -- 43.2%
TAIWAN -- 10.6%
Acer Peripherals, Inc. ..... 23,000 $ 56,968
Asustek Computer, Inc. --
GDR....................... 7,191 103,550
Compal Electronics, Inc. ... 29 117
Far Eastern Textile,
Ltd.**.................... 42,000 62,417
Hitron Technology, Inc.**... 25,000 98,687
President Chain Store
Corp. .................... 21,000 71,194
Silicon Integrated
Systems**................. 19,330 93,361
Synnex Technology
International
Corp. -- GDR.............. 3,250 73,450
Systex Corp.**.............. 21,000 60,141
Taiwan Semiconductor
Manufacturing Co., Ltd. --
ADR**..................... 2,625 89,250
------------
709,135
------------
SOUTH KOREA -- 10.5%
Comtec System Co., Ltd. .... 9,000 79,700
Hansol Paper Co. ........... 4,800 76,305
Kookmin Bank................ 5,600 113,697
Korea Data System........... 2,072 60,524
Korea Telecom Corp. --
ADR**..................... 988 39,520
Lotte Chilsung Beverage
Co. ...................... 600 63,242
Lotte Confectionery Co. .... 580 91,701
Samsung Corp.**............. 4,400 103,399
SK Telecom Co.,
Ltd. -- ADR............... 120 2,040
Trigem Computer, Inc. ...... 1,800 69,981
------------
700,109
------------
HONG KONG -- 5.6%
Automated Systems Holdings,
Ltd. ..................... 185,000 68,553
Beijing Yanhua Petrochemical
Co., Ltd. ................ 474,000 106,914
Legend Holdings, Ltd. ...... 100,000 96,022
Pacific Century Insurance
Holdings, Ltd.**.......... 38,000 30,758
Quality Healthcare Asia,
Ltd.**.................... 374,000 72,789
------------
375,036
------------
THAILAND -- 4.7%
Advanced Info Service Public
Co., Ltd. (Foreign)**..... 6,000 81,358
Land and House Public Co.,
Ltd. (Foreign)**.......... 41,000 74,497
Seamico Securities Public
Co., Ltd. (Foreign)....... 24,000 72,246
Siam Commercial Bank (Pref.)
(Foreign)**............... 60,000 85,426
------------
313,527
------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
SINGAPORE -- 4.2%
Datacraft Asia, Ltd. ....... 33,032 $ 144,020
Magnecomp International,
Ltd. ..................... 54,000 64,800
Star Cruises PLC............ 16,000 71,360
------------
280,180
------------
PHILIPPINES -- 3.5%
Filinvest Land, Inc.**...... 600,000 67,808
International Container
Terminal Services,
Inc.**.................... 820,000 106,679
SPI Technologies, Inc. ..... 126,000 61,263
------------
235,750
------------
INDONESIA -- 2.5%
PT Astra Agro Lestari Tbk... 198,000 69,022
PT Telekomunikasi
Indonesia -- ADR.......... 7,560 94,028
------------
163,050
------------
CHINA -- 0.9%
Eastern Communications Co.,
Ltd. ..................... 61,000 62,220
------------
AUSTRALIA -- 0.7%
MYOB, Ltd.**................ 37,037 49,031
------------
Total Far East.............. 2,888,038
------------
EUROPE -- 14.7%
TURKEY -- 3.6%
Haci Omer Sabanci
Holdings -- ADR........... 6,500 35,425
Vestel Elektronik Sanayi Ve
Ticaret AS **............. 877,000 95,596
Yapi Ve Kredi Bankasi AS --
GDR....................... 7,422 110,224
------------
241,245
------------
POLAND -- 3.5%
Elektrim Spolka Akcyjna
SA........................ 6,500 91,949
Optimus SA.................. 6,000 72,183
Softbank SA -- GDR.......... 1,900 69,825
------------
233,957
------------
GREECE -- 3.3%
Alpha Credit Bank SA........ 87 5,608
Chipita International SA.... 2,735 71,391
Folli-Follie Abee........... 3,000 83,262
Interamerican SA............ 340 7,607
Panafon Hellenic Telecom
SA**...................... 2,080 50,165
------------
218,033
------------
RUSSIA -- 2.2%
LUKoil Holdings -- ADR...... 2,240 88,704
Rostelecom -- ADR**......... 6,000 58,875
------------
147,579
------------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
44
<PAGE> 48
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
HUNGARY -- 1.0%
Gedeon Richter -- GDR ...... 1,500 $ 65,148
------------
UNITED KINGDOM -- 0.6%
ITE Group PLC .............. 60,228 42,722
------------
CZECH REPUBLIC -- 0.5%
Komercni Banka AS --
GDR**..................... 5,000 31,438
------------
Total Europe................ 980,122
------------
SOUTH AMERICA -- 14.3%
BRAZIL -- 10.3%
Aracruz Celulose
SA -- ADR................. 3,000 66,000
Companhia Paranaense de
Energia -- ADR............ 10,350 86,681
Companhia Siderurgica
Nacional.................. 1,500,000 38,495
Industrias Klabin de Papel e
Celulose SA** ............ 182,275 91,500
Petroleo Brasileiro SA --
ADR ...................... 5,188 79,885
Tele Norte Leste
Participacoes SA -- ADR... 6,100 113,231
Tele Sudeste Celular
Participacoes SA -- ADR... 2,573 74,617
Telecommunicacoes
Brasileiras SA (Pref.) --
ADR....................... 621 56,006
Telesp Celular Participacoes
SA (Pref.)................ 7,700,000 80,346
------------
686,761
------------
ARGENTINA -- 2.3%
Banco de Galicia Buenos
Aires SA de CV -- ADR..... 4,500 91,125
Telefonica de Argentina
SA -- ADR................. 1,920 60,240
------------
151,365
------------
VENEZUELA -- 1.7%
Compania Anonima Nacional
Telefonos de Venezuela --
ADR ...................... 4,200 114,450
------------
Total South America......... 952,576
------------
NORTH AMERICA -- 13.7%
MEXICO -- 11.2%
Consorcio Hogar SA de
CV -- B**................. 57,500 37,125
Controladora Comercial
Mexicana SA de CV......... 60,000 63,000
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
Corporacion Interamericana
de Entretenimiento SA -- B
**........................ 18,000 $ 58,395
Fomento Economico Mexicano
SA de CV -- ADR........... 2,900 115,637
Grupo Continental SA........ 42,000 65,705
Grupo Financiero Banorte SA
de CV -- O**.............. 81,000 115,743
Grupo Iusacell SA -- L --
ADR**..................... 6,000 78,000
Grupo Televisa
SA -- GDR**............... 3,020 135,334
Hylsamex SA**............... 5,000 15,612
Tubos de Acero de Mexico
SA -- ADR................. 6,000 65,250
------------
749,801
------------
UNITED STATES -- 2.5%
Amdocs, Ltd.**.............. 1,300 29,575
MIH, Ltd.**................. 2,339 61,984
Star Media Network,
Inc.**.................... 1,200 76,950
------------
168,509
------------
Total North America............. 918,310
------------
AFRICA -- 8.8%
SOUTH AFRICA -- 8.8%
Anglo American Platinum
Corp., Ltd. .............. 3,000 69,999
Bidvest Group, Ltd. ........ 7,375 61,598
BOE, Ltd. .................. 60,000 59,659
De Beers -- Centenary Linked
Units..................... 2,000 47,926
Investec Group, Ltd. ....... 1,600 67,083
Nedcor, Ltd. ............... 3,305 74,816
Sappi, Ltd. ................ 9,500 69,585
Sasol, Ltd. ................ 11,000 78,476
Specialised Outsourcing,
Ltd. ..................... 8,500 59,443
------------
588,585
------------
Total Africa.................... 588,585
------------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
45
<PAGE> 49
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
- ----------------------------------------------------------
<S> <C> <C>
MIDDLE EAST -- 2.0%
EGYPT -- 1.8%
Egyptian Company for Mobile
Services**................ 5,145 $ 115,977
------------
ISRAEL -- 0.2%
Check Point Software
Technologies, Ltd. **..... 291 15,605
------------
Total Middle East........... 131,582
------------
- ----------------------------------------------------------
TOTAL INVESTMENTS (COST
$4,935,960)................. 96.7% 6,459,213
Other Assets in Excess of
Liabilities................. 3.3% 220,431
------------
Net Assets...................... 100.0% $ 6,679,644
==========================================================
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------
Number Market
of Value
Shares (Note A)
<S> <C> <C>
The federal income tax basis and unrealized appreciation
(depreciation) for all securities is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis...................................... $4,935,960
==========
Gross Appreciation......................... $1,558,442
Gross Depreciation......................... (35,189)
----------
Net Appreciation....................... $1,523,253
==========
</TABLE>
** Non-income producing security.
Notes to Financial Statements are an integral part of this Schedule.
46
<PAGE> 50
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Appliances............................. 1.4%
Automobiles............................ 0.9%
Banking................................ 8.7%
Beverages.............................. 2.7%
Broadcast & Publishing Services........ 3.7%
Capital Goods/Multi-Industry........... 0.5%
Chemicals.............................. 2.8%
Computer Manufacturing................. 7.2%
Consumer Non-durables/Multi-Industry... 1.0%
Drugs.................................. 1.0%
Electrical & Electronics............... 1.4%
Electrical Utilities................... 1.3%
Electronic Components.................. 0.9%
Electronic Systems/Devices............. 4.7%
Financial Services..................... 4.6%
Foods & Household Products............. 3.4%
Forest Products........................ 4.5%
Health Care............................ 1.1%
Home Building.......................... 0.6%
Information Technology................. 0.5%
Insurance.............................. 0.6%
International Trading.................. 1.5%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
- -------- ----------
<S> <C>
Leisure................................ 1.2%
Leisure & Tourism...................... 0.9%
Merchandising.......................... 1.9%
Metal Fabrication & Distribution....... 1.0%
Metals -- Nonferrous................... 1.0%
Metals -- Steel........................ 0.8%
Miscellaneous Materials................ 0.7%
Office/Communications Equipment........ 2.0%
Oil.................................... 2.5%
Real Estate............................ 2.1%
Retailing -- Foods..................... 2.0%
Software & EDP Services................ 3.9%
Technology/Multi-Industry.............. 3.7%
Telecommunications..................... 9.1%
Telephone Utilities.................... 5.4%
Textiles & Apparel..................... 0.9%
Tools & Hardware....................... 1.0%
Transportation -- Shipping............. 1.6%
Other Assets In Excess Of
Liabilities.......................... 3.3%
------
TOTAL.................................. 100.0%
======
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
47
<PAGE> 51
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $4,935,960).......... $6,459,213
Foreign currency (Cost $145,325)........................ 144,267
Cash.................................................... 155,743
Receivables:
Dividends.......................................... 14,016
Interest........................................... 64
Investment securities sold......................... 205,396
Due from affiliates................................ 4,394
Prepaid expenses........................................ 21,254
Deferred organizational costs........................... 20,576
----------
- --------------------------------------------------------------------------
TOTAL ASSETS................................... 7,024,923
----------
- --------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 318,767
Net unrealized depreciation on unsettled foreign
currency forward contracts from transaction
hedges........................................... 61
Accrued expenses........................................ 26,451
----------
- --------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 345,279
----------
- --------------------------------------------------------------------------
NET ASSETS.................................................. $6,679,644
==========
SHARES OUTSTANDING.......................................... 546,229
==========
NET ASSET VALUE PER SHARE................................... $ 12.23
==========
==========================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 1999:
Paid-in capital......................................... $5,456,407
Undistributed net investment loss....................... (24,434)
Undistributed net realized loss......................... (249,872)
Undistributed net realized foreign exchange loss........ (23,855)
Unrealized foreign exchange loss........................ (1,855)
Unrealized appreciation on investments.................. 1,523,253
----------
NET ASSETS..................................... $6,679,644
==========
==========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
48
<PAGE> 52
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTH PERIOD JANUARY 1, 1999 THROUGH JUNE 30, 1999
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (net of non-reclaimable foreign taxes of
$2,016)............................................ $ 39,327
Interest........................................... 3,840
----------
- --------------------------------------------------------------------------
Total income..................................... 43,167
----------
- --------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 37,579
Administration fee................................. 57,000
Professional fees.................................. 16,294
Federal and state registration fees................ 2,724
Custodian fee...................................... 32,597
Transfer agent fees................................ 18,079
Trustees' fees..................................... 1,960
Amortization of organization costs................. 2,907
Miscellaneous...................................... 11,285
----------
- --------------------------------------------------------------------------
Total expenses before fees waived and
reimbursements..................................... 180,425
----------
Administration fee waived.......................... (53,492)
Transfer agent fees waived......................... (15,600)
Expense reimbursement from advisor................. (43,732)
----------
Total expenses net of fees waived and
reimbursements................................... 67,601
----------
- --------------------------------------------------------------------------
Net investment loss............................ (24,434)
----------
- --------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions............ 591,336
Net realized foreign exchange loss...................... (23,855)
Net change in unrealized foreign exchange gain.......... 2,892
Change in unrealized appreciation of investments........ 1,298,613
----------
- --------------------------------------------------------------------------
Net gain on investments........................ 1,868,986
- --------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $1,844,552
==========
==========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
49
<PAGE> 53
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the period
from the
For the six month period commencement
January 1, 1999 For the three month period of operations
through October 1, 1998 December 31, 1997
June 30, 1999 through through
(unaudited) December 31, 1998 September 30, 1998
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INCREASE IN NET ASSETS:
Operations:
Net investment loss................... $ (24,434) $ (11,895) $ (11,861)
Net realized and unrealized gain
(loss) on investments............... 1,868,986 553,317 (1,228,857)
---------- ---------- -----------
- ---------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets resulting from
operations...................... 1,844,552 541,422 (1,240,718)
---------- ---------- -----------
- ---------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income................. -- -- --
Capital gains......................... -- -- --
---------- ---------- -----------
Total distributions to
shareholders.................... -- -- --
---------- ---------- -----------
- ---------------------------------------------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold............. 1,479,000 -- 4,737,772
Reinvestment of distributions......... -- -- --
Cost of shares redeemed............... (672,384) -- (10,000)
---------- ---------- -----------
Net increase in net assets derived
from capital share
transactions.................... 806,616 -- 4,727,772
---------- ---------- -----------
Total increase in net assets...... 2,651,168 541,422 3,487,054
---------- ---------- -----------
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
- ---------------------------------------------------------------------------------------------------------------------------
Beginning of period....................... $4,028,476 $3,487,054 $ --
End of period............................. $6,679,644 $4,028,476 $ 3,487,054
========== ========== ===========
===========================================================================================================================
Capital share transactions are as follows:
Shares issued......................... 150,389 -- 462,301
Shares reinvested..................... -- -- --
Shares redeemed....................... (65,407) -- (1,054)
---------- ---------- -----------
Net increase from capital share
transactions.................... 84,982 -- 461,247
========== ========== ===========
===========================================================================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
50
<PAGE> 54
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The Table below sets forth financial data for a share of capital stock
outstanding throughout each period presented.
<TABLE>
<CAPTION>
For the period
For the six from the
month period For the three commencement
January 1, 1999 month period of operations
through October 1, 1998 December 31, 1997
June 30, 1999 through through
(unaudited) December 31, 1998 September 30, 1998
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net Asset value, beginning of period............ $ 8.73 $ 7.56 $ 10.00
------- ------- -------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment loss........................... (0.04) (0.03) (0.03)
Net gains (losses) on investments (both
realized and unrealized).................... 3.54 1.20 (2.41)
------- ------- -------
Total income (loss) from investment
operations........................... 3.50 1.17 (2.44)
------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income.......... -- -- --
Distributions from capital gains.............. -- -- --
------- ------- -------
Total distributions.................... -- -- --
------- ------- -------
Net asset value, end of period.................. $ 12.23 $ 8.73 $ 7.56
======= ======= =======
Total Return........................... 40.09 %** 15.48 %** (24.40)%**
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000's).......... $ 6,680 $ 4,028 $ 3,487
Ratio of expenses to average net assets....... 2.70 %*+ 2.75 %*+ 2.75 %*+
Ratio of net investment loss to average net
assets...................................... (0.98)%*+ (1.23)%*+ (0.49)%*+
Portfolio turnover............................ 177.95 %** 82.60 %** 261.21 %**
Annualized portfolio turnover................. 358.85 % 327.69 % 349.24 %
</TABLE>
- --------------------------------------------------------------------------------
* Annualized
** Not Annualized
+ Such ratios are after administrative agent and transfer agent waivers and
Adviser expense reimbursements. PFPC Inc., the administrative agent and
transfer agent, waived a portion of its fees. The Adviser agreed to absorb
other operating expenses to the extent necessary to ensure that the total
fund operating expenses (other than interest, taxes, brokerage commissions
and other portfolio transaction expenses, capital expenditures, and
extraordinary expenses) will not exceed the fund's operating expense cap for
the first twenty-nine months of its operations. For the period from December
31, 1997 (the commencement of operations) through May 31, 1999 the Fund's
operating expense cap was 2.75% of average net assets. For the period June 1,
1999 through May 31, 2000 the operating expense cap has been reduced to 2.50%
of average net assets.
Notes to Financial Statements are an integral part of this schedule.
51
<PAGE> 55
- --------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS
(unaudited)
- --------------------------------------------------------------------------------
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
The DRIEHAUS MUTUAL FUNDS (the "TRUST"), a registered management investment
company, organized as a Delaware business trust with five separate series
("FUNDS"). The Trust was organized under an Agreement and Declaration of Trust
dated May 31, 1996 and may issue an unlimited number of full and fractional
units of beneficial interest (shares) without par value. The five series
included in the trust are as follows:
------------------------------------
<TABLE>
<CAPTION>
Fund Commencement of Operations
----------------------------------------------------------------------------------------
<S> <C>
*THE DRIEHAUS INTERNATIONAL GROWTH FUND 10/28/96
**THE DRIEHAUS INTERNATIONAL DISCOVERY FUND 12/31/98
**THE DRIEHAUS EUROPEAN OPPORTUNITY FUND 12/31/98
THE DRIEHAUS ASIA PACIFIC GROWTH FUND 12/31/97
THE DRIEHAUS EMERGING MARKETS GROWTH FUND 12/31/97
----------------------------------------------------------------------------------------
</TABLE>
* The DRIEHAUS INTERNATIONAL GROWTH FUND was the successor to the assets of
the Driehaus International Large Cap Fund, L.P. (the "Partnership"), a
Limited Partnership organized on July 1, 1990.
** Prior to the commencement of investment operations on January 4, 1999, the
DRIEHAUS INTERNATIONAL DISCOVERY FUND and the DRIEHAUS EUROPEAN OPPORTUNITY
FUND had no operations other than those relating to organizational matters.
------------------------------------
The investment objective of the FUNDS is to maximize capital appreciation.
The DRIEHAUS INTERNATIONAL GROWTH FUND seeks to achieve its objective by
investing primarily in equity securities of foreign companies.
The DRIEHAUS INTERNATIONAL DISCOVERY FUND seeks to achieve its objective by
investing primarily in equity securities of foreign companies with market
capitalizations of less than $1 billion.
The DRIEHAUS EUROPEAN OPPORTUNITY FUND seeks to achieve its objective by
investing primarily in equity securities of European companies.
The DRIEHAUS ASIA PACIFIC GROWTH FUND seeks to achieve its objective by
investing primarily in equity securities of Asia Pacific companies.
The DRIEHAUS EMERGING MARKETS GROWTH FUND seeks to achieve its objective by
investing primarily in the equity securities of emerging market companies.
FISCAL YEAR END
Effective September 1, 1998, the DRIEHAUS INTERNATIONAL GROWTH FUND changed
its fiscal year end to December 31. Effective October 1, 1998, the DRIEHAUS ASIA
PACIFIC GROWTH FUND and the DRIEHAUS EMERGING MARKETS GROWTH FUND each changed
their fiscal year ends to December 31. The Fiscal year end for the DRIEHAUS
INTERNATIONAL DISCOVERY FUND and the DRIEHAUS EUROPEAN OPPORTUNITY FUND is
December 31.
SECURITIES VALUATION AND TRANSACTIONS
Depending upon local convention or regulation, equity securities may be
valued at the last sale price, last bid or asked price, or the mean between the
last bid and asked prices as of, in each case, the close of the appropriate
exchange or other designated time. Securities for which market quotations are
not readily available are valued at fair value as determined in good faith by or
under the direction of the Trust's Board of Trustees. At June 30, 1999, there
were no securities for which market quotations were not available.
Securities transactions are accounted for on trade date. The cost of
investments sold is determined by the use of specific identification method for
both financial reporting and income tax purposes. Interest income is recorded on
an accrual basis. Dividend income, net of non-reclaimable foreign taxes
withheld, is recorded on the ex-dividend date.
The FUNDS determine income and expenses, daily. This change in net asset
value is allocated daily.
52
<PAGE> 56
- --------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
- --------------------------------------------------------------------------------
FEDERAL INCOME TAXES
No provision is made for Federal income taxes since the FUNDS' have already
elected to be taxed as a "regulated investment company" under Subchapter M of
the Internal Revenue Code and have made all the required distributions to their
shareholders in amounts sufficient to relieve the FUNDS from all or
substantially all Federal income and excise taxes under provisions of current
Federal tax law.
The DRIEHAUS INTERNATIONAL GROWTH FUND, the DRIEHAUS INTERNATIONAL DISCOVERY
FUND, the DRIEHAUS EUROPEAN OPPORTUNITY FUND, the DRIEHAUS ASIA PACIFIC GROWTH
FUND and the DRIEHAUS EMERGING MARKETS GROWTH FUND intend to utilize provisions
of the federal income tax laws, which allow them to carry a realized capital
loss forward up to eight years following the year of the loss, and offset such
losses against any future realized gains. As of December 31, 1998, the DRIEHAUS
INTERNATIONAL GROWTH FUND, the DRIEHAUS ASIA PACIFIC GROWTH FUND and the
DRIEHAUS EMERGING MARKETS GROWTH FUND had capital loss carryforwards of
approximately $2,663,000, $470,000 and $707,000 respectively, which may be
carried forward eight tax years.
For the period ending June 30, 1999 the DRIEHAUS INTERNATIONAL GROWTH FUND,
the DRIEHAUS ASIA PACIFIC GROWTH FUND and the DRIEHAUS EMERGING MARKETS GROWTH
FUND made reclassifications of $2,661,685, $196,010 and $54,225, respectively
from undistributed net realized foreign exchange loss to paid in capital, in
accordance with the American Institute of Certified Public Accountants'
Statement of Position 93-2, "Determination, Disclosure and Financial Statement
Presentation of Income, Capital Gain and Return of Capital Distributions by
Investment Companies."
FOREIGN CURRENCY TRANSLATION
Foreign currency is translated into U.S. dollar values based upon the
current rates of exchange on the date of the FUNDS' valuation.
Net realized foreign exchange gains or losses which are reported by the
FUNDS result from currency gains and losses on transaction hedges arising from
changes in exchange rates between the trade and settlement dates on forward
contracts underlying securities transactions, and the difference between the
amounts accrued for dividends, interest, and reclaimable foreign withholding
taxes and the amounts actually received or paid in U.S. dollars for these items.
Net unrealized foreign exchange gains and losses result from changes in the U.S.
dollar value of assets and liabilities (other than investments in securities),
which are denominated in foreign currencies, as a result of changes in exchange
rates.
Net realized foreign exchange gains or losses on portfolio hedges result
from the non-speculative use of forward contracts with respect to portfolio
positions denominated or quoted in a particular currency in order to reduce or
limit exposure in that currency. The FUNDS had no open portfolio hedges at June
30, 1999.
The FUNDS do not isolate that portion of the results of operations which
results from fluctuations in foreign exchange rates on investments held. These
fluctuations are included with the net realized and unrealized gains or losses
which result from changes in the market prices of investments.
------------------------------------
DEFERRED ORGANIZATION COSTS
Organization costs incurred by the DRIEHAUS INTERNATIONAL GROWTH FUND,
DRIEHAUS ASIA PACIFIC GROWTH FUND, and the DRIEHAUS EMERGING MARKETS GROWTH FUND
have been deferred and are amortized over a period of 60 months. The FUNDS'
remaining amortization periods for these costs are as follows:
<TABLE>
<CAPTION>
Fund Remaining Amortization Period
<S> <C>
THE DRIEHAUS INTERNATIONAL GROWTH FUND 27 Months
THE DRIEHAUS ASIA PACIFIC GROWTH FUND 42 Months
THE DRIEHAUS EMERGING MARKETS GROWTH FUND 42 Months
- ---------------------------------------------------------------------------------------------
</TABLE>
------------------------------------
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 amount of assets
53
<PAGE> 57
- --------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
- --------------------------------------------------------------------------------
and liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of net increases or
decreases in net assets from operations during the reporting period. Actual
results could differ from those estimates.
B. INVESTMENT ADVISORY FEES,
TRANSACTIONS WITH AFFILIATES, AND
ADMINISTRATIVE FEES
Richard H. Driehaus, the Chairman of the Board and President of the TRUST,
is also the Chairman of the Board, sole director, and sole shareholder of
Driehaus Capital Management, Inc., a registered investment adviser, and of
Driehaus Securities Corporation, a registered broker-dealer.
Driehaus Capital Management, Inc. ("DCM") serves as the FUNDS' investment
adviser. In return for its services to the FUNDS, DCM receives a monthly fee,
computed and accrued daily at an annual rate of 1.5% of each FUND'S average net
assets.
Upon commencement of operations, DCM agreed to absorb other operating
expenses to the extent necessary to ensure that total operating expenses (other
than interest, taxes, brokerage commissions and other portfolio transaction
expenses, capital expenditures and extraordinary expenses) for the DRIEHAUS
INTERNATIONAL DISCOVERY FUND, the DRIEHAUS EUROPEAN OPPORTUNITY FUND, the
DRIEHAUS ASIA PACIFIC GROWTH FUND, and the DRIEHAUS EMERGING MARKETS GROWTH FUND
will not exceed, 2.50%, 2.10%, 2.95%, and 2.75%, respectively, of the average
net assets of each FUND on an annual basis, for the period beginning with the
effective date of each FUND'S registration statement through May 31, 1999.
Effective June 1, 1999, the current expense caps for the DRIEHAUS INTERNATIONAL
DISCOVERY FUND, the DRIEHAUS EUROPEAN OPPORTUNITY FUND, the DRIEHAUS ASIA
PACIFIC GROWTH FUND, and the DRIEHAUS EMERGING MARKETS GROWTH FUND are 2.40%,
2.10%, 2.50%, and 2.50%, respectively, of the average net assets of each FUND on
an annual basis. The expense cap for each FUND will remain at this current rate
until May 31, 2000.
------------------------------------
The expense caps, amount accrued and payable to DCM, and amounts accrued and
receivable from DCM during the six months ended June 30, 1999 are as follows:
<TABLE>
<CAPTION>
Expense
Reimbursement
Advisory Fees Expense Cap Receivable
Payable January 1, 1999 June 1, 1999 (included in
(included in due to to due from
Fund Advisory Fees to affiliates) May 31, 1999 June 30, 1999 affiliates)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
DRIEHAUS INTERNATIONAL GROWTH
FUND $1,747,731 $304,741 Not Applicable --
DRIEHAUS INTERNATIONAL
DISCOVERY FUND 51,755 6,889 2.50% 2.40% --
DRIEHAUS EUROPEAN OPPORTUNITY
FUND 38,969 -- 2.10% 2.10% 738
DRIEHAUS ASIA PACIFIC GROWTH
FUND 51,497 5,713 2.95% 2.50% --
DRIEHAUS EMERGING MARKETS
GROWTH FUND 37,579 -- 2.75% 2.50% 4,394
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
54
<PAGE> 58
- --------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
- --------------------------------------------------------------------------------
Driehaus Securities Corporation ("DSC") has acted as the FUNDS' distributor
since December 31, 1998. For the period December 18, 1997 to December 30, 1998,
the FUNDS' were self-distributed. Prior to December 18, 1997, DSC was the FUNDS'
distributor.
DSC acts as a broker for the FUNDS for domestically traded securities. For
the six months ended June 30, 1999, the FUNDS paid the following brokerage
commissions:
------------------------------------
<TABLE>
<CAPTION>
Total Commissions Shares Traded
Fund Commissions Paid to DSC through DSC
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
DRIEHAUS INTERNATIONAL GROWTH FUND $1,863,965 $192,325 4,307,485
DRIEHAUS INTERNATIONAL DISCOVERY FUND 82,753 7,346 254,698
DRIEHAUS EUROPEAN OPPORTUNITY FUND 42,662 40 19,130
DRIEHAUS ASIA PACIFIC GROWTH FUND 122,431 1,756 24,206
DRIEHAUS EMERGING MARKETS GROWTH FUND 69,452 18,623 418,079
- -------------------------------------------------------------------------------------------------------------
</TABLE>
A portion of these commissions are, in turn paid by DSC to third parties for
clearing and floor brokerage services.
------------------------------------
Certain officers of the TRUST are also officers of the Adviser. No such
officers received compensation from the FUNDS.
PFPC Inc., a wholly owned, indirect subsidiary of PNC Bank, serves as the
FUNDS' administrative and accounting agent. In compensation for its services,
PFPC receives the larger of a monthly minimum fee and a monthly fee based upon
average net assets. PFPC has agreed to waive its minimum fees during the first
twenty-four months of operations for the DRIEHAUS INTERNATIONAL DISCOVERY FUND,
the DRIEHAUS EUROPEAN OPPORTUNITY FUND, the DRIEHAUS ASIA PACIFIC GROWTH FUND,
and the DRIEHAUS EMERGING MARKETS GROWTH FUND.
For the six months ended June 30, 1999, $52,169, $53,363, $52,194, and
$53,492 of these fees have been waived by PFPC Inc. for the DRIEHAUS
INTERNATIONAL DISCOVERY FUND, the DRIEHAUS EUROPEAN OPPORTUNITY FUND, the
DRIEHAUS ASIA PACIFIC GROWTH FUND, and the DRIEHAUS EMERGING MARKETS GROWTH
FUND, respectively.
PFPC Inc., also acts as the transfer agent and dividend dispensing agent for
the FUNDS. PFPC Inc. has agreed to waive a portion of its monthly fee for
transfer agent service, for the first two years of operations, for the DRIEHAUS
INTERNATIONAL DISCOVERY FUND, the DRIEHAUS EUROPEAN OPPORTUNITY FUND, the
DRIEHAUS ASIA PACIFIC GROWTH FUND, and the DRIEHAUS EMERGING MARKETS GROWTH
FUND. For the six months ended June 30, 1999, $15,600 of these fees were waived
by PFPC Inc., for each of these FUNDS.
C. FOREIGN CURRENCY FORWARD CONTRACTS
At June 30, 1999 the FUNDS had foreign currency forward contracts
outstanding under which they are obligated to exchange currencies at specified
future dates. At June 30, 1999 the FUNDS' currency transactions are limited to
transaction hedges.
The contractual amounts of foreign currency forward contracts do not
necessarily represent the amounts potentially subject to risk. The measurement
of the risks associated with these instruments is meaningful only when all
related and offsetting transactions are considered. Risks arise from the
possible inability of counter parties to meet the terms of their contracts and
from movements in currency values.
55
<PAGE> 59
- --------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
- --------------------------------------------------------------------------------
The FUNDS had the following outstanding contracts at June 30, 1999:
DRIEHAUS INTERNATIONAL GROWTH FUND
Transaction Hedges:
Foreign Currency Purchases:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Sold Foreign Currency Purchased Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$174,229 256,447 Canadian Dollars July 1999 $ (959)
173,229 256,447 Canadian Dollars July 1999 (959)
801,298 773,678 Euro July 1999 (3,717)
358,678 43,260,156 Japanese Yen July 1999 (937)
-------
$(6,572)
- ---------------------------------------------------------------------------
</TABLE>
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$285,428 277,034 Euro July 1999 $ (165)
147,734 142,642 Euro July 1999 696
129,541 716,381 Euro July 1999 1,977
329,765 39,772,977 Japanese Yen July 1999 861
324,946 3,075,454 Mexican Peso July 1999 (578)
249,148 156,934 Pound Sterling July 1999 1,772
970,958 617,226 Pound Sterling July 1999 (2,012)
219,273 8,319,229 Philippine Peso July 1999 659
131,688 5,063,397 Philippine Peso July 1999 (1,354)
220,997 8,425,503 Philippine Peso July 1999 (284)
-------
$ 1,572
-------
Net unrealized depreciation $(5,000)
=======
- ---------------------------------------------------------------------------
</TABLE>
DRIEHAUS INTERNATIONAL DISCOVERY FUND
Transaction Hedges:
Foreign Currency Purchases:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Sold Foreign Currency Purchased Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$ 78,058 118,629 Australian Dollars July 1999 $ 374
- ---------------------------------------------------------------------------
</TABLE>
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$ 72,556 70,422 Euro July 1999 $ (42)
83,118 10,024,910 Japanese Yen July 1999 217
70,624 8,517,930 Japanese Yen July 1999 184
36,309 56,479 Swiss Franc July 1999 (21)
71,138 2,627,142 Thailand Baht July 1999 (108)
-------
$ 230
-------
Net unrealized appreciation $ 604
=======
- ---------------------------------------------------------------------------
</TABLE>
56
<PAGE> 60
- --------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
- --------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
Transaction Hedges:
Foreign Currency Purchases:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Sold Foreign Currency Purchased Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$ 72,080 517,172 Denmark Krona July 1999 $ (168)
70,906 68,821 Euro July 1999 41
48,068 46,654 Euro July 1999 130
-------
$ 3
- ---------------------------------------------------------------------------
</TABLE>
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$ 25,413 24,537 Euro July 1999 $ 120
48,863 30,778 Pounds Sterling July 1999 347
90,857 772,874 Swedish Krona July 1999 (265)
54,464 84,719 Swiss Franc July 1999 (32)
-------
$ 170
-------
Net unrealized appreciation $ 173
=======
- ---------------------------------------------------------------------------
</TABLE>
DRIEHAUS ASIA PACIFIC GROWTH FUND
Transaction Hedges:
Foreign Currency Purchases:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Sold Foreign Currency Purchased Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$ 79,169 9,569,100 Japanese Yen July 1999 $ (48)
-------
$ (48)
- ---------------------------------------------------------------------------
</TABLE>
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$ 61,323 7,412,146 Japanese Yen July 1999 $ 37
-------
Net unrealized depreciation $ (11)
=======
- ---------------------------------------------------------------------------
</TABLE>
57
<PAGE> 61
- --------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
- --------------------------------------------------------------------------------
DRIEHAUS EMERGING MARKETS GROWTH FUND
Transaction Hedges:
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 1999
- ---------------------------------------------------------------------------
<C> <S> <C> <C>
$ 34,702 269,280 Hong Kong Dollars July 1999 $ --
36,677 8,873,942 Hungarian Forints July 1999 20
53,338 1,969,782 Thailand Bahts July 1999 (81)
-------
$ (61)
-------
Net unrealized depreciation $ (61)
=======
- ---------------------------------------------------------------------------
</TABLE>
D. INVESTMENT TRANSACTIONS
The aggregate purchases and sales of investments securities, other than
short-term obligations, for the six months ended June 30, 1999, were as follows:
------------------------------------
<TABLE>
<CAPTION>
Fund Purchases Sales
- -----------------------------------------------------------------------------------------------
<S> <C> <C>
DRIEHAUS INTERNATIONAL GROWTH FUND $345,375,385 $342,181,787
DRIEHAUS INTERNATIONAL DISCOVERY FUND 14,544,819 8,737,993
DRIEHAUS EUROPEAN OPPORTUNITY FUND 10,717,901 5,632,280
DRIEHAUS ASIA PACIFIC GROWTH FUND 15,160,462 13,487,619
DRIEHAUS EMERGING MARKETS GROWTH FUND 9,321,294 8,443,878
- -----------------------------------------------------------------------------------------------
</TABLE>
E. RESTRICTED SECURITIES
Restricted securities are securities that are not registered for sale under
the Securities Act of 1933 ("1933 Act") and that may be re-sold only in
transactions exempt from registration. Restricted securities include rule 144A
securities which may be sold normally to qualified institutional buyers. At June
30, 1999 the DRIEHAUS INTERNATIONAL GROWTH FUND held restricted securities with
the aggregate market value equal to $6,211,960 representing 2.4% of the FUND'S
net assets. No other FUND held restricted securities at June 30, 1999.
F. LINES OF CREDIT
The FUNDS have a ten million dollar committed line of credit. This line of
credit is available primarily to meet large, unexpected shareholder withdrawals.
For the six months ended June 30, 1999, no borrowing has been made on this line
of credit.
G. OFF BALANCE SHEET RISKS
The FUNDS' investments in foreign securities may entail risks due to the
potential for political and economic instability in the countries where the
issuers of these securities are located. In addition, foreign exchange
fluctuations could affect the value of positions held. These risks are generally
intensified in emerging markets. It is the Advisor's policy to continuously
monitor its exposure to these risks.
------------------------------------
58
