<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
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.
103 Bellevue Parkway
Wilmington, DE 19809
Custodian
The Chase Manhattan Bank
3 Chase MetroTech Center
Brooklyn, NY 11245
SEMI-ANNUAL REPORT TO SHAREHOLDERS
JUNE 30, 2000
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
Portfolio Manager's Letter....................... 1
Schedule of Investments.......................... 4
Driehaus International Discovery Fund
Portfolio Managers' Letter....................... 12
Schedule of Investments.......................... 15
Driehaus European Opportunity Fund
Portfolio Manager's Letter....................... 22
Schedule of Investments.......................... 25
Driehaus Asia Pacific Growth Fund
Portfolio Manager's Letter....................... 32
Schedule of Investments.......................... 35
Driehaus Emerging Markets Growth Fund
Portfolio Manager's Letter....................... 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, 2000
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 January 1, 2000, through June 30, 2000, the Driehaus
International Growth Fund returned -10.32%. This compares with a return of
-4.06% for the Morgan Stanley Capital International Europe, Australia, Far East
(EAFE) Index and -4.11% for the Lipper International Fund Index for the first
half of 2000. For the six-month period, the Driehaus International Growth Fund
ranked 612th among the 703 funds in its Lipper International Fund peer group.(1)
In recognition of the fund's three-year performance, the fund received a
Morningstar rating of five stars, representing the fund's overall rating among
701 international equity funds as of June 30, 2000.(2)
June 30, 2000, also marked the completion of 10 years of performance for the
Driehaus International Growth Fund. Over this 10-year period, the fund returned
19.91% annualized, compared with the Morgan Stanley Capital International EAFE
Index's 7.95% and the Lipper International Fund Index's 9.90%.(3) The fund's
performance was achieved during quite an amazing period in terms of global
financial events. While the overall environment was one of generally rising
prices, the past 10 years also encompassed an unusual number of crises and
financial scares: the Japanese financial crisis of the early 90s; the emerging
markets crisis of 1994; the Asian crisis of 1997; the global economic crisis of
1998; and the technology meltdown of 2000. By adhering to our strategy of
remaining fully invested in rapidly growing companies worldwide, we navigated
this period with superior returns as compared to other international mutual
funds.
The most recent six-month period began with a continuation of the
accelerated share price appreciation seen during the fourth quarter of 1999. By
early March, this had brought the valuations of growth company shares to
unsustainable levels. A major correction, most notably in technology, media, and
telecommunications shares, followed, adversely affecting many of the sectors
where we held positions. While we reduced our holdings in these areas, many of
the outstanding growth companies we favor are found in these sectors, and we did
not totally eliminate our exposure.
From our perspective, the indices of growth shares appear to have bottomed
out in late May. Since that time, the markets have been stronger, with
increasing volume on positive -- rather than negative -- days, improved
performance from individual stocks, and emerging leadership from several new
groups. In this environment, we have focused on exciting areas such as fiber
optics, healthcare, and energy.
The fiber optics area is currently benefiting from the major investments in
Internet infrastructure over the past few years, which created increased
consumer demand for higher bandwidth as a necessary part of the next step in
broadband communications. Previously used to carry long-distance traffic, fiber
optic networks are now being built to carry information directly into consumers'
homes, which has geometrically increased the demand for fiber optic equipment.
Our primary approach to this area is through investments in the makers of cable,
switches, testers, wave-division multiplexers, and other fiber optic equipment
in Europe, Canada, and Japan. In Japan, many of these companies receive the bulk
of their revenues from so-called "old economy" products, but up to 50% of their
earnings now come from their fiber optics business.
Another group that appears to be among the emerging market leaders is the
healthcare sector, where we have seen strong performance from pharmaceuticals
shares. Our holdings in this sector include a number of fast-growing European
companies that are ready to debut new pharmaceutical products, such as Serono
SA, Elan Corp. PLC, Shire Pharmaceuticals Group PLC, and Schering AG. In
addition to burgeoning new product pipelines, favorable trends in the
pharmaceuticals area include the recent completion of the mapping of the human
genome, which should lead to a massive increase in drug development efforts, and
consolidation in the European pharmaceutical market, which should reduce the
companies' research and development costs. In addition, pharmaceutical companies
are ultimately considered defensive holdings because they are largely immune to
the effects of any potential global economic slowdown.
In energy, we anticipate significant appreciation in the second half as well
as additional earnings recovery. Several of our current holdings involve
emerging market companies that offer strong growth profiles and valuations much
below those of their international peers.
1
<PAGE> 5
Overall, we are more positive on global markets now than we were before the
decline, which removed some of the extreme valuations, and we believe our
portfolio is poised to benefit from this environment. We believe many growth
stocks are now more reasonably valued and we are optimistic about a new rise in
the market.
Sincerely,
William R Anderson
William R. Andersen
Portfolio Manager
August 24, 2000
---------------
(1) The fund's total return for the six-month period ending June 30, 2000, was
ranked number 612 out of the 703 funds by Lipper Analytical Services, Inc. in
the Lipper International Fund category.
(2) Morningstar proprietary ratings on U.S.-domiciled funds reflect
risk-adjusted performance through June 30, 2000. Past performance does not
guarantee future returns. The overall Morningstar rating is a weighted average
of the fund's three-, five-, and 10-year (if applicable) performance. Subject to
change every month, ratings are calculated from the fund's three-, five-, and
ten-year (when available) average annual total returns in excess of 90-day
Treasury bill returns with appropriate fee adjustments and a risk factor that
reflects fund performance below 90-day T-bill returns. The top 10% of the funds
in an investment category receive five stars, the next 22.5% receive four stars,
and the next 35% receive three stars; the next 22.5% receive two stars; and the
bottom 10% receive one star. The fund was rated exclusively against
U.S.-domiciled funds. For the three-year period ended June 30, 2000, the
Driehaus International Growth Fund received 5 stars among 701 international
equity funds. The fund also received an overall rating of 5 stars.
(3) The Driehaus International Growth Fund performance data 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, which was established
on July 1, 1990, was managed following substantially the same objective,
policies, and philosophies as are currently followed by the Driehaus
International Growth Fund, successor to the Partnership's assets on October 28,
1996. The Partnership was not registered under the Investment Company Act of
1940 ("1940 Act") 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 estimated expenses of
the Fund.
2
<PAGE> 6
DRIEHAUS INTERNATIONAL GROWTH FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 6/30/00
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DRIEHAUS INTERNATIONAL MSCI LIPPER
GROWTH FUND EAFE INTERNATIONAL
(DRIGX) INDEX FUND INDEX
---------------------- ----- -------------
<S> <C> <C> <C>
One Year 58.15% 17.16% 23.63%
Three Years 25.97% 10.18% 11.91%
Five Years 26.99% 11.33% 14.43%
Ten Years 19.91% 7.95% 9.90%
Since Inception (7/1/90 -- 6/30/00) 19.91% 7.95% 9.90%
</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>
<S> <C> <C>
DRIGX MSCI EAFE Index
Jul 1990 100000.00 100000.00
86601.00 78801.00
Dec 1990 89755.00 87099.00
102746.00 93573.00
105643.00 88467.00
105259.00 96051.00
Dec 1991 109228.00 97661.00
117111.00 86071.00
126030.00 87891.00
118282.00 89216.00
Dec 1992 118606.00 85773.00
135240.00 96054.00
142834.00 105716.00
163373.00 112727.00
Dec 1993 206030.00 113701.00
175484.00 117676.00
170382.00 123688.00
190949.00 123808.00
Dec 1994 177981.00 122545.00
169343.00 124827.00
186111.00 125734.00
207588.00 130976.00
Dec 1995 210166.00 136279.00
239371.00 140217.00
268940.00 142436.00
253440.00 142257.00
Dec 1996 261596.00 144520.00
270985.00 142257.00
307522.00 160718.00
320208.00 159586.00
Dec 1997 299239.00 147090.00
368797.00 168726.00
404569.00 170518.00
327062.00 146280.00
Dec 1998 344570.00 176503.00
353222.00 178958.00
388723.00 183506.00
411993.00 191559.00
Dec 1999 685472.00 224096.00
709479.00 223860.00
Jun 2000 614752.00 214992.00
<S> <C>
Lipper International Fund Index
Jul 1990 100000.00
81729.00
Dec 1990 85405.00
91999.00
89596.00
95356.00
Dec 1991 96654.00
94687.00
98947.00
93676.00
Dec 1992 92514.00
100444.00
105962.00
116121.00
Dec 1993 128763.00
127382.00
128499.00
133501.00
Dec 1994 127815.00
124638.00
130987.00
138125.00
Dec 1995 140625.00
146824.00
152817.00
152934.00
Dec 1996 160915.00
164901.00
183358.00
186871.00
Dec 1997 172578.00
198181.00
199863.00
168329.00
Dec 1998 194428.00
196919.00
207850.00
214857.00
Dec 1999 267988.00
269645.00
Jun 2000 256972.00
</TABLE>
The Driehaus International Growth Fund (the "Fund" or "DRIGX") 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)
Europe, Australia and Far East (EAFE) Index with dividends reinvested and the
Lipper International Fund Index with dividends reinvested for the same period.
The MSCI EAFE 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.
3
<PAGE> 7
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 97.1%
----------------------------------------------------------
EUROPE -- 47.3%
UNITED KINGDOM -- 13.5%
Amvescap PLC................ 533,855 $ 8,566,953
Bookham Technology PLC**.... 49,355 2,873,675
Bookham Technology PLC --
ADR**..................... 47,904 2,838,312
Celltech Group PLC**........ 214,514 4,156,835
COLT Telecom Group PLC**.... 48,165 1,604,174
Energis PLC**............... 89,800 3,368,797
Enterprise Oil PLC.......... 1,103,000 9,313,486
Marconi PLC................. 416,295 5,419,969
Nycomed Amersham PLC**...... 148,560 1,475,377
Pace Micro Technology PLC... 444,830 6,431,239
Shire Pharmaceuticals Group
PLC**..................... 33,400 578,455
Shire Pharmaceuticals Group
PLC -- ADR**.............. 171,204 8,881,208
------------
55,508,480
------------
FRANCE -- 8.8%
Alcatel**................... 191,395 12,604,329
Castorama Dubois
Investissement SA......... 12,910 3,205,224
STMicroelectronics NV**..... 112,496 7,117,270
STMicroelectronics NV --
ADR**..................... 10,295 660,810
Thomson Multimedia**........ 69,604 4,523,726
Total Fina Elf SA........... 51,070 7,862,195
------------
35,973,554
------------
GERMANY -- 7.8%
Epcos AG**.................. 28,715 2,923,249
Infineon Technologies
AG**...................... 123,495 10,109,733
Intershop Communications
AG**...................... 10,830 4,972,747
Marschollek, Lautenschlaeger
and Partner AG............ 490 205,732
Schering AG................. 85,010 4,648,984
Singulus Technologies
AG**...................... 151,450 9,262,375
------------
32,122,820
------------
NETHERLANDS -- 6.7%
ASM Lithography Holding
NV**...................... 82,230 3,548,691
ASM Lithography Holding
NV -- ADR**............... 27,751 1,224,513
Fox Kids Europe NV**........ 202,650 3,205,258
IHC Caland NV............... 6,595 322,417
Koninklijke Ahold NV........ 281,945 8,332,404
Koninklijke Numico NV....... 106,124 5,055,946
Koninklijke Philips
Electronics NV............ 90,170 4,283,075
United Pan-Europe
Communications NV**....... 59,025 1,549,746
------------
27,522,050
------------
</TABLE>
<TABLE>
----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
SWITZERLAND -- 2.5%
Adecco SA................... 7,600 $ 6,477,950
Serono SA -- B**............ 4,790 4,006,224
------------
10,484,174
------------
SPAIN -- 1.9%
Altadis SA.................. 518,030 7,989,937
------------
ITALY -- 1.5%
Bulgari SpA................. 458,650 6,155,196
------------
IRELAND -- 1.4%
Elan Corp. PLC -- ADR**..... 121,640 5,891,938
------------
RUSSIA -- 1.4%
LUKoil Holdings -- ADR...... 435,995 5,572,016
Novosibirsk Telephone**..... 4,000 80,000
------------
5,652,016
------------
FINLAND -- 0.9%
Nokia Oyj................... 73,870 3,784,846
------------
DENMARK -- 0.7%
Novo Nordisk A/S -- B....... 17,225 2,943,820
------------
TURKEY -- 0.2%
Haci Omer Sabanci Holding
AS -- ADR................. 21,967 64,715
Yapi ve Kredi Bankasi AS.... 50,564,024 563,201
------------
627,916
------------
Total Europe................ 194,656,747
------------
FAR EAST -- 33.2%
JAPAN -- 13.8%
Daiichi Pharmaceutical Co.,
Ltd....................... 129,000 3,279,821
Daiwa Securities Group,
Inc....................... 600 7,939
Eisai Co., Ltd.............. 76,000 2,442,309
Fuji Television Network,
Inc....................... 369 5,789,520
Fujikura, Ltd............... 630,000 4,197,955
Mitsubishi Electric Corp.... 364,000 3,949,584
NEC Corp.................... 190,000 5,980,066
Net One Systems Co., Ltd.... 61 1,406,785
Nichii Gakkan Co............ 5 220
Nihon Dempa Kogyo Co.,
Ltd....................... 73,700 3,831,231
Nippon Sheet Glass Co.,
Ltd....................... 468,000 6,520,058
Sanyo Electric Co., Ltd..... 152,000 1,370,566
Square Co., Ltd............. 9,600 709,555
Tokyo Denpa Co., Ltd........ 33,200 2,077,324
Tokyo Seimitsu Co., Ltd..... 31,300 4,200,885
Toshiba Corp................ 532,000 6,018,856
Toys "R" Us -- Japan,
Ltd.**.................... 25,000 4,253,247
Yahoo Japan Corp.**......... 2 794,885
------------
56,830,806
------------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
4
<PAGE> 8
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
HONG KONG -- 7.4%
China Mobile Hong Kong,
Ltd.**.................... 1,225,000 $ 10,804,160
China Unicom, Ltd.**........ 714,000 1,515,927
China Unicom, Ltd. --
ADR**..................... 330,715 7,027,694
Cosco Pacific, Ltd.......... 4,734,000 3,734,957
Johnson Electric Holdings,
Ltd.**.................... 39,000 368,985
Li & Fung, Ltd.............. 1,396,000 6,984,450
------------
30,436,173
------------
SOUTH KOREA -- 6.7%
Cheil Communications, Inc... 71,855 9,376,693
Insung Information Co.,
Ltd.**.................... 19,174 293,202
Korea Telecom Freetel**..... 59,890 3,990,918
Samsung Electronics......... 6,870 2,273,593
Samsung SDI Co., Ltd........ 134,900 6,472,849
SK Telecom Co., Ltd. --
ADR....................... 142,358 5,169,375
------------
27,576,630
------------
INDIA -- 2.7%
Himachal Futuristic
Communications, Ltd....... 110,753 3,520,360
Reliance Industries, Ltd.... 300,000 2,289,402
Satyam Computer Services,
Ltd....................... 81,250 5,424,360
------------
11,234,122
------------
SINGAPORE -- 0.9%
Chartered Semiconductor
Manufacturing, Ltd. --
ADR**..................... 42,326 3,809,340
------------
CHINA -- 0.8%
PetroChina Co., Ltd.**...... 7,830,000 1,627,268
PetroChina Co., Ltd. --
ADR**..................... 82,264 1,722,403
------------
3,349,671
------------
AUSTRALIA -- 0.5%
CSL, Ltd.................... 102,271 2,028,532
------------
THAILAND -- 0.3%
TelecomAsia Corporation
Public Co., Ltd.
(Foreign)**............... 973,100 1,079,190
------------
TAIWAN -- 0.1%
Taiwan Semiconductor
Manufacturing Co., Ltd. --
ADR**..................... 6,860 265,825
------------
Total Far East.............. 136,610,289
------------
</TABLE>
<TABLE>
----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
NORTH AMERICA -- 8.8%
CANADA -- 4.2%
Canadian Natural Resources,
Ltd.**.................... 69,260 $ 2,010,016
Descartes Systems Group,
Inc.**.................... 148,500 4,409,889
Nortel Networks Corp........ 160,336 10,942,932
------------
17,362,837
------------
UNITED STATES -- 2.0%
Amdocs, Ltd.**.............. 56,831 4,361,779
JDS Uniphase Corp.**........ 33,650 4,033,794
------------
8,395,573
------------
MEXICO -- 1.1%
Grupo Televisa SA --
GDR**..................... 66,420 4,578,829
------------
CAYMAN ISLANDS -- 1.1%
Triton Energy, Ltd. **...... 112,200 4,410,863
------------
BERMUDA -- 0.4%
FLAG Telecom Holdings,
Ltd.**.................... 116,300 1,729,963
------------
Total North America......... 36,478,065
------------
MIDDLE EAST -- 4.4%
ISRAEL -- 4.4%
NICE Systems, Ltd. --
ADR**..................... 145,929 11,263,895
Orbotech, Ltd.**............ 55,188 5,125,586
Teva Pharmaceutical
Industries, Ltd. -- ADR... 33,602 1,862,811
------------
18,252,292
------------
Total Middle East........... 18,252,292
------------
SOUTH AMERICA -- 3.0%
BRAZIL -- 3.0%
Petroleo Brasileiro SA
(Pref.)................... 392,546 11,859,411
Petroleo Brasileiro SA
(Pref.) -- ADR............ 15,800 477,342
------------
12,336,753
------------
Total South America......... 12,336,753
------------
AFRICA -- 0.4%
SOUTH AFRICA -- 0.4%
Dimension Data Holdings
PLC**..................... 179,200 1,482,811
------------
Total Africa................ 1,482,811
------------
Total Equity Securities
(Cost $365,742,496)....... 399,816,957
------------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
5
<PAGE> 9
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
RIGHTS -- 0.0%
----------------------------------------------------------
THAILAND -- 0.0%
TelecomAsia Corporation
Public Co., Ltd.
(Foreign) -- Rights**..... 307,294 $ 0
------------
Total Rights (Cost $0)...... 0
------------
----------------------------------------------------------
TOTAL INVESTMENTS (COST
$365,742,496)............... 97.1% $399,816,957
Other Assets in Excess of
Liabilities................. 2.9% 11,772,196
---------- ------------
Net Assets...................... 100.0% $411,589,153
==========================================================
The federal income tax basis and unrealized appreciation
(depreciation) for all investments is as follows:
Basis...................................... $365,742,496
============
Gross Appreciation......................... $ 48,827,718
Gross Depreciation*........................ (14,753,257)
------------
Net Appreciation......................... $ 34,074,461
============
* Exclusive of foreign withholding tax refund receivable
of $765,989.
**Non-income producing security.
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
6
<PAGE> 10
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Appliances............................. 1.4%
Banking................................ 0.1%
Biotechnology.......................... 1.0%
Broadcast & Publishing................. 5.6%
Business & Publishing Services......... 1.6%
Chemicals.............................. 2.9%
Communications......................... 0.5%
Computer Manufacturers................. 0.1%
Construction........................... 0.1%
Consumer Services/Multi-Industry....... 0.9%
Drugs.................................. 2.1%
Electrical............................. 0.9%
Electrical & Electronics............... 8.6%
Electrical Equipment................... 1.0%
Electronic Components.................. 4.2%
Electronic Systems/Devices............. 3.1%
Energy/Multi-Industry.................. 0.5%
Energy Sources......................... 6.3%
Financial Services..................... 2.1%
Food Processors........................ 1.2%
Health Care............................ 4.5%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Insurance.............................. 0.1%
Investments............................ 1.7%
Lasers................................. 1.0%
Machinery.............................. 2.3%
Merchandising.......................... 2.8%
Miscellaneous Materials................ 1.6%
Office/Communication Equipment......... 2.7%
Oil.................................... 1.2%
Other Computers........................ 1.2%
Pharmaceutical......................... 2.2%
Retailing -- Goods..................... 2.5%
Semiconductors/Components.............. 7.2%
Software & EDP Services................ 3.7%
Technology/Multi-Industry.............. 3.8%
Telecommunications..................... 9.0%
Telecommunications Equipment........... 2.6%
Telephone Utilities.................... 0.3%
Textiles & Apparel..................... 0.6%
Tobacco................................ 1.9%
Other Assets in Excess of
Liabilities.......................... 2.9%
------
TOTAL.................................. 100.0%
======
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
7
<PAGE> 11
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $365,742,496)........ $399,816,957
Foreign currency (Cost $32,895)......................... 31,825
Cash.................................................... 23,970,012
Receivables:
Dividends.......................................... 286,358
Interest........................................... 80,836
Investment securities sold......................... 4,577,519
Fund shares sold................................... 4,107,571
Foreign withholding tax refund..................... 1,083,593
Prepaid expenses........................................ 15,910
Deferred organizational costs........................... 31,753
------------
----------------------------------------------------------------------------
TOTAL ASSETS................................... 434,002,334
------------
----------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 21,195,328
Fund shares redeemed............................... 160,924
Due to affiliates.................................. 504,467
Net unrealized depreciation on unsettled foreign
currency forward contracts from transaction
hedges............................................ 162,284
Foreign taxes...................................... 42,727
Accrued expenses........................................ 347,451
------------
----------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 22,413,181
------------
----------------------------------------------------------------------------
NET ASSETS.................................................. $411,589,153
============
SHARES OUTSTANDING.......................................... 21,715,279
============
NET ASSET VALUE PER SHARE................................... $ 18.95
============
============================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 2000:
Paid-in capital......................................... $229,920,212
Undistributed net investment loss....................... (2,048,452)
Undistributed net realized gain......................... 151,189,817
Undistributed net realized foreign exchange loss........ (2,207,590)
Unrealized foreign exchange loss........................ (105,284)
Unrealized appreciation on investments (including
foreign withholding tax refund receivable of
$765,989).............................................. 34,840,450
------------
NET ASSETS..................................... $411,589,153
============
============================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
8
<PAGE> 12
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTH PERIOD JANUARY 1, 2000 THROUGH JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (Net of non-reclaimable foreign taxes of
$133,857)......................................... $ 1,672,178
Interest........................................... 348,272
Other.............................................. 5,606
-------------
-------------------------------------------------------------------------------
Total income..................................... 2,026,056
-------------
-------------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 3,400,466
Administration fee................................. 233,051
Professional fees.................................. 70,407
Federal and state registration fees................ 7,839
Custodian fee...................................... 230,358
Transfer agent fees................................ 45,608
Trustees' fees..................................... 15,633
Amortization of organization costs................. 12,651
Miscellaneous...................................... 58,495
-------------
-------------------------------------------------------------------------------
Total expenses................................... 4,074,508
-------------
-------------------------------------------------------------------------------
Net investment loss............................ (2,048,452)
-------------
-------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions (net of
foreign capital gains tax of $2,671,251)............... 110,738,684
Net realized foreign exchange loss...................... (2,207,590)
Net change in unrealized foreign exchange loss.......... (100,192)
Net change in unrealized appreciation of investments
(including foreign withholding tax refund receivable of
$765,989).............................................. (151,016,145)
-------------
-------------------------------------------------------------------------------
Net realized and unrealized loss on
investments................................... (42,585,243)
-------------
-------------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $ (44,633,695)
=============
===============================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
9
<PAGE> 13
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the six month period
January 1, 2000
through For the year
June 30, 2000 ended
(unaudited) December 31, 1999
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment loss................................. $ (2,048,452) $ (2,802,042)
Net realized and unrealized gain (loss) on
investments....................................... (42,585,243) 234,546,276
------------- -------------
-----------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations............................... (44,633,695) 231,744,234
------------- -------------
-----------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income............................... -- --
Capital gains....................................... -- (32,567,117)
------------- -------------
Total distributions to shareholders............. -- (32,567,117)
------------- -------------
-----------------------------------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold........................... 297,189,682 242,087,350
Reinvestment of distributions....................... -- 32,422,270
Cost of shares redeemed............................. (307,538,254) (230,946,531)
------------- -------------
Net increase (decrease) in net assets derived
from capital share transactions............... (10,348,572) 43,563,089
------------- -------------
Total increase (decrease) in net assets......... (54,982,267) 242,740,206
------------- -------------
-----------------------------------------------------------------------------------------------------------------
NET ASSETS:
-----------------------------------------------------------------------------------------------------------------
Beginning of period..................................... $ 466,571,420 $ 223,831,214
------------- -------------
End of period........................................... $ 411,589,153 $ 466,571,420
============= =============
=================================================================================================================
Capital share transactions are as follows:
Shares issued....................................... 14,462,677 17,125,507
Shares reinvested................................... -- 1,765,919
Shares redeemed..................................... (14,829,504) (16,194,532)
------------- -------------
Net increase (decrease) from capital share
transactions.................................. (366,827) 2,696,894
============= =============
=================================================================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
10
<PAGE> 14
--------------------------------------------------------------------------------
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, 2000 month period of operations
through For the year September 1, 1998 For the year October 28, 1996
June 30, 2000 ended through ended through
(unaudited) December 31, 1999 December 31, 1998 August 31, 1998 August 31, 1997
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning
of period................ $ 21.13 $ 11.55 $ 12.39 $ 11.90 $ 10.00
-------- -------- -------- -------- --------
INCOME (LOSS) FROM
INVESTMENT OPERATIONS:
Net investment loss...... (0.09) (0.13) (0.04) (0.07) (0.05)
Net gains (losses) on
investments (both
realized and
unrealized)............ (2.09) 11.31 (0.25) 1.77 1.95
-------- -------- -------- -------- --------
Total income (loss)
from investment
operations....... (2.18) 11.18 (0.29) 1.70 1.90
-------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net
investment income...... -- -- -- -- --
Distributions from
capital gains.......... -- (1.60) (0.55) (1.21) --
-------- -------- -------- -------- --------
Total
distributions.... -- (1.60) (0.55) (1.21) --
-------- -------- -------- -------- --------
Net asset value, end of
period................... $ 18.95 $ 21.13 $ 11.55 $ 12.39 $ 11.90
======== ======== ======== ======== ========
Total Return....... (10.32)%** 98.94% (2.04)%** 16.50% 19.00%**
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in 000's)............. $411,589 $466,571 $223,831 $229,088 $180,545
Ratio of expenses to
average net assets..... 1.80%* 1.82% 2.00%* 1.88% 2.11%*+
Ratio of net investment
loss to average net
assets................. (0.90)%* (1.03)% (1.46)%* (0.54)% (0.67)%*+
Portfolio turnover....... 170.15%** 273.64% 116.28%** 219.78% 380.02%**
Annualized portfolio
turnover............... 342.17% 273.64% 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 Fund's operations.
Notes to Financial Statements are an integral part of this Schedule.
11
<PAGE> 15
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND -- PORTFOLIO MANAGERS' LETTER
--------------------------------------------------------------------------------
Dear Fellow Shareholders:
For the period January 1, 2000, through June 30, 2000, the Driehaus
International Discovery Fund returned 9.52%. This compares with a return of
-4.06% for the Morgan Stanley Capital International Europe, Australia, Far East
(EAFE) Index and -0.41% for the Lipper International Small Cap Fund Index for
the first half of the year. For this period, the Driehaus International
Discovery Fund ranked 11th among the 82 funds in its Lipper International Small
Cap Fund peer group.*
During the first quarter of the year, we saw very strong price appreciation
in markets around the world, particularly in technology, media, and
telecommunications shares. To a large degree, international markets were simply
reflecting the activity of the Nasdaq index in the U.S., which performed well
during the first 10 weeks of the year. However, valuations that reached
unsustainable levels led to a major correction that hit hardest in the sectors
that had led the advance. After testing a series of lows in late May,
international markets rebounded slightly. One of the most significant changes in
the fund during the first half was our reduction of the fund's technology
exposure from about 44% at the end of 1999 to 25% on June 30.
Europe, which accounted for approximately half of the fund's investments at
the end of the first half, was one of the regions that suffered during the
sell-off, dragged down by extremely stretched valuations and lower-
than-expected earnings estimates. Overall, the balance of economic data coming
from Europe in the first six months of the year was mixed. Recently, however, we
were encouraged by the emergence of several new investment themes as well as a
renewed focus on company quality. This created a better environment for stock
selection, and several key sectors appeared to be demonstrating robust economic
growth.
In keeping with the trends we identified, we reduced our high-priced
technology holdings in the Internet-related area, reallocating assets to more
defensive sectors, including consumer non-durables such as food and beverage
companies, and healthcare, particularly biotechnology. These are areas that we
believe will benefit from a potential recovery in European markets, as consumer
confidence increases and GDP growth and exports rise. Examples include: LVL
Medical SA, a French supplier of medical equipment for in-home treatment of
respiratory diseases, AIDS, depression, and cancer; and Thiel Logistik AG, a
Luxembourg-based manufacturer of computer software used in electronic commerce
and hospital inventory control that has benefited from Germany's required
outsourcing of public health system logistics.
At the beginning of 2000, the fund was overweighted in emerging markets,
which also started off the year with strong appreciation. However, because these
markets are highly sensitive to interest rates in the U.S., the continued
tightening by the Federal Reserve eventually took its toll, and these markets
also underwent a major correction. As the likelihood of a slowdown and a soft
landing for the U.S. economy increased over the past two months, we saw a
recovery in the emerging markets. Based on increasing earnings estimates, lower
valuations, and strong economic growth, especially in Brazil and Mexico, the
fund added to its positions in emerging markets, particularly in Latin America
and Asia. One example is TV Azteca SA de CV, the second largest television
broadcasting company in Mexico, which is expected to see increasing market share
and higher advertising revenues in 2000. With about 20% of the fund invested in
emerging markets as of June 30, we remained overweighted in this area relative
to the EAFE index.
Asia, in particular Japan and South Korea, also had a difficult time in the
first half of the year. Based on restructuring efforts in these two countries
last year, expectations had been very high. However, as both Japan and South
Korea continued to struggle with problems in the banking sector, the slowdown in
restructuring led to disappointment. While we basically maintained our exposure
to South Korea during the first half, we increased our allocation to Japan based
on improving growth opportunities in the semiconductor area. Two successful
additions in this area were CKD Corp. and Central Glass Co., Ltd., which supply
components to the semiconductor industry. One bright spot in Asia so far this
year is China, where the economy has rebounded due to improving exports to other
countries within the region and an easing of monetary policy. Another recent
addition to the fund, China Shipping Development Co., Ltd., is benefiting from
increased exports.
12
<PAGE> 16
We also took advantage of the first-quarter correction in international
markets to add several other exciting new names that have performed well for the
fund, including:
- Himachal Futuristic Communications, Ltd., a telecommunications equipment
manufacturer that has seen more than 300% profit growth this year as it
benefits from the building of fiber optic networks in India.
- AudioCodes, Ltd., an Israeli-based forerunner in voice-over Internet protocol
(IP) technology that enables alternative telecommunications companies to
provide voice services over data networks.
- Kirin Beverage Corp., which has seen its green tea product gain market share
as Japanese consumers become increasingly health-conscious.
Detracting from the fund's performance during the first half of the year was
the collapse of the European technology sector, particularly Internet-related
stocks, which were overvalued. We also saw poor performance from selected
stocks, including Garnet Systems Co., Ltd. While Garnet has good growth
potential based on the demand for its ADSL modems in the South Korean market,
its performance was hurt by the collapse of local investor confidence due to
banking sector concerns.
Overall, we are more positive on global markets now than we were before the
decline, which removed some of the extreme valuations. We believe the increased
emphasis on selection of individual stocks--one of the Driehaus
strengths--should result in continued strong performance for shareholders during
the remainder of 2000.
Sincerely,
<TABLE>
<S> <C>
Emery R. Brewer Eric J. Ritter
Emery R. Brewer Eric J. Ritter
Senior Portfolio Manager Portfolio Manager
August 24, 2000 August 24, 2000
</TABLE>
---------------
* The fund's total return for the six-month period ending June 30, 2000, was
ranked number 11 out of 82 funds by Lipper Analytical Services, Inc. in the
Lipper International Small Cap Fund category.
13
<PAGE> 17
DRIEHAUS INTERNATIONAL DISCOVERY FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 6/30/00
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DRIEHAUS INTERNATIONAL LIPPER INTERNATIONAL
DISCOVERY MSCI EAFE SMALL CAP
FUND (DRIDX) INDEX FUND INDEX
---------------------- --------- --------------------
<S> <C> <C> <C>
One Year 141.91% 17.16% 37.74%
Since Inception (12/31/98 - 6/30/00) 127.67% 14.05% 38.08%
</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>
<S> <C> <C>
DRIDX MSCI EAFE Index
Dec 1998 10000.00 10000.00
Mar 1999 10420.00 9789.00
Jun 1999 10830.00 9759.00
Sep 1999 12940.00 9873.00
Dec 1999 26990.00 11589.00
Mar 2000 41569.00 12683.00
Jun 2000 34352.00 12181.00
<S> <C>
Lipper International Small Cap Fund Index
Dec 1998 10000.00
Mar 1999 9908.00
Jun 1999 10071.00
Sep 1999 10211.00
Dec 1999 12749.00
Mar 2000 17988.00
Jun 2000 16226.00
</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 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.
14
<PAGE> 18
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
-----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 91.2%
-----------------------------------------------------------
EUROPE -- 53.1%
GERMANY -- 13.1%
Brainpool TV AG**............ 9,015 $ 769,110
ComputerLinks AG............. 7,745 415,759
Evotec Biosystems AG**....... 10,140 915,633
JUMPtec Industrielle
Computertechnik AG**....... 11,530 1,022,359
Kontron Embedded Computers
AG**....................... 10,765 980,325
Pandatel AG**................ 6,860 802,262
Suess MicroTec AG**.......... 32,840 1,234,018
Tecis Holding AG............. 10,790 1,003,288
Zapf Creation AG............. 20,158 1,236,687
-----------
8,379,441
-----------
FRANCE -- 12.3%
Beneteau SA.................. 12,900 1,093,755
Bouygues Offshore SA......... 8,500 427,770
Consodata SA**............... 15,520 538,558
Dane -- Elec Memory.......... 6,897 773,532
Expand....................... 9,674 880,972
Genesys**.................... 12,000 522,814
LVL Medical SA............... 14,800 622,814
Pierre & Vacances............ 5,389 322,865
Recif**...................... 8,400 402,607
Remy Cointreau SA**.......... 30,136 983,638
Silicon-On-Insulator
Technologies**............. 3,326 781,125
Wavecom SA**................. 4,200 511,311
-----------
7,861,761
-----------
SWITZERLAND -- 7.5%
ESEC Holding AG.............. 377 932,026
Jelmoli Holding AG........... 740 932,924
Micronas Semiconductor
Holding AG**............... 1,837 1,028,043
Mikron Holding AG............ 1,308 966,077
OZ Holding AG................ 755 947,192
-----------
4,806,262
-----------
NETHERLANDS -- 5.0%
BE Semiconductor Industries
NV**....................... 90,880 1,424,356
Nutreco Holding NV........... 27,597 1,058,226
Unique International NV...... 28,332 681,685
-----------
3,164,267
-----------
FINLAND -- 3.9%
Aspocomp Group Oyj........... 8,100 465,874
Elcoteq Network Corp. -- A... 23,410 515,011
Hartwall Oyj ABP............. 16,000 322,086
Teleste Oyj -- B............. 49,200 1,202,646
-----------
2,505,617
-----------
UNITED KINGDOM -- 1.8%
Easynet Group PLC**.......... 44,000 671,112
Trafficmaster PLC**.......... 56,000 503,584
-----------
1,174,696
-----------
</TABLE>
<TABLE>
-----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
LUXEMBOURG -- 1.6%
Thiel Logistik AG**.......... 10,572 $ 1,003,286
-----------
SPAIN -- 1.6%
NH Hoteles SA**.............. 86,750 1,002,049
-----------
BELGIUM -- 1.3%
Omega Pharma SA.............. 21,705 801,038
-----------
ITALY -- 1.2%
SAES Getters SpA............. 45,800 747,235
-----------
POLAND -- 1.1%
Art Marketing Syndicate
SA**....................... 22,862 328,111
ComputerLand SA**............ 14,000 395,421
-----------
723,532
-----------
GREECE -- 0.9%
Folli -- Follie Abee......... 26,000 574,870
-----------
RUSSIA -- 0.7%
AO Tatneft -- ADR............ 47,600 467,075
-----------
ESTONIA -- 0.7%
Hansabank, Ltd............... 60,000 453,905
-----------
NORWAY -- 0.4%
Opticom ASA**................ 2,155 232,204
-----------
Total Europe................. 33,897,238
-----------
FAR EAST -- 26.7%
JAPAN -- 11.7%
Central Glass Co., Ltd....... 183,000 973,795
CKD Corp..................... 120,000 1,106,979
Don Quijote Co., Ltd......... 3,800 664,452
Kirin Beverage Corp.......... 36,000 959,533
Moritex Corp................. 6,000 547,251
Mycal Card Inc............... 16,300 611,626
Net One Systems Co., Ltd..... 10 230,621
Nippon Thompson Co., Ltd..... 41,000 623,904
Nishimatsuya Chain Co.,
Ltd........................ 16,000 359,919
Shin-Kobe Electric Machinery
Co., Ltd................... 70,000 539,879
Toys "R" Us -- Japan,
Ltd.**..................... 5,000 850,650
-----------
7,468,609
-----------
SOUTH KOREA -- 3.6%
Cheil Communications, Inc.... 8,900 1,161,402
Garnet Systems Co., Ltd.**... 48,066 487,139
Jang Media Interactive
Corp....................... 2,850 54,700
LG Ad, Inc................... 5,000 318,838
Lotte Chilsung Beverage Co... 4,040 306,536
-----------
2,328,615
-----------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
15
<PAGE> 19
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
-----------------------------------------------------------
<S> <C> <C>
AUSTRALIA -- 2.7%
Central Pacific Minerals NL
-- ADR**................... 45,800 $ 220,413
FH Faulding & Company,
Ltd........................ 117,000 574,919
Oil Search, Ltd.**........... 418,700 460,054
PowerLan, Ltd................ 463,418 485,817
-----------
1,741,203
-----------
CHINA -- 2.6%
Beijing Datang Power
Generation Co., Ltd........ 1,500,000 336,753
China Shipping Development
Co., Ltd.**................ 7,250,000 1,320,713
-----------
1,657,466
-----------
HONG KONG -- 2.2%
ASM Pacific Technology,
Ltd........................ 171,000 640,562
Giordano International,
Ltd........................ 514,781 782,570
-----------
1,423,132
-----------
TAIWAN -- 1.8%
Bank Sinopac................. 900,000 578,590
Realtek Semiconductor Corp... 50,000 417,221
Wintek Corp.**............... 36,400 128,822
-----------
1,124,633
-----------
MALAYSIA -- 0.9%
Digi.com Berhad**............ 332,000 607,223
-----------
PHILIPPINES -- 0.7%
Ayala Land, Inc.............. 3,400,000 432,584
-----------
THAILAND -- 0.5%
BEC World Public Co., Ltd.
(Foreign).................. 50,000 293,190
-----------
Total Far East............... 17,076,655
-----------
MIDDLE EAST -- 5.5%
ISRAEL -- 4.1%
AudioCodes, Ltd.**........... 9,300 1,116,000
NUR Macroprinters, Ltd.**.... 56,700 822,150
RADWARE, Ltd.**.............. 10,600 280,900
TTI Team Telecom
International, Ltd.**...... 11,500 414,000
-----------
2,633,050
-----------
TURKEY -- 1.4%
Global Menkul Degerler AS**.. 66,041,000 916,822
-----------
Total Middle East............ 3,549,872
-----------
NORTH AMERICA -- 3.3%
MEXICO -- 2.1%
Corporacion Interamericana de
Entretenimiento SA --
B**........................ 172,900 688,565
TV Azteca SA de CV -- ADR.... 48,000 633,000
-----------
1,321,565
-----------
</TABLE>
<TABLE>
-----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
UNITED STATES -- 0.7%
Electric Fuel Corp.**........ 30,390 $ 465,347
-----------
CANADA -- 0.5%
Hurricane Hydrocarbons,
Ltd.**..................... 70,000 316,535
-----------
Total North America.......... 2,103,447
-----------
SOUTH AMERICA -- 2.6%
BRAZIL -- 2.6%
Celular CRT Participacoes SA
(Pref.)**.................. 1,000,000 432,385
Tele Nordeste Celular
Participacoes SA -- ADR.... 17,600 1,218,800
-----------
1,651,185
-----------
Total South America.......... 1,651,185
-----------
Total Equity Securities (Cost
$55,339,113)............... 58,278,397
-----------
-----------------------------------------------------------
EQUITY PARTICIPATION NOTES -- 1.2% (Note C)
-----------------------------------------------------------
INDIA-- 1.2%
Himachal Futuristic
Communications, Ltd.
(Series A)**+.............. 24,000 765,597
-----------
Total Equity Participation
Notes (Cost $592,342)...... 765,597
-----------
-----------------------------------------------------------
RIGHTS/WARRANTS -- 0.0%
-----------------------------------------------------------
TAIWAN -- 0.0%
Wintek Corp. -- Rights**..... 8,720 2,548
-----------
THAILAND -- 0.0%
Seamico Securities Public
Co., Ltd. (Foreign) --
Warrants**................. 9,375 0
-----------
Total Rights/Warrants (Cost
$0)........................ 2,548
-----------
-----------------------------------------------------------
TOTAL INVESTMENTS (COST
$55,931,455)................. 92.4% $59,046,542
Other Assets in Excess of
Liabilities.................. 7.6% 4,848,885
---------- -----------
Net Assets....................... 100.0% $63,895,427
===========================================================
The federal income tax basis and unrealized appreciation
(depreciation) for all investments is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis.................................... $ 55,931,455
============
Gross Appreciation*...................... $ 5,615,233
Gross Depreciation....................... (2,500,146)
------------
Net Appreciation....................... $ 3,115,087
============
*Exclusive of foreign withholding taxes
payable of $3,797.
**Non-income producing security.
+Restricted security.
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
16
<PAGE> 20
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Alternative Energy........................ 0.7%
Banking................................... 3.8%
Beverages & Tobacco....................... 3.5%
Biotechnology............................. 1.4%
Broadcast & Publishing Services........... 8.1%
Business & Publishing Services............ 1.0%
Chemicals................................. 1.5%
Clothing.................................. 1.2%
Consumer Non-Durables/Multi-Industry...... 1.9%
Consumer Services/Multi-Industry.......... 0.9%
Data Processing........................... 0.6%
Electrical & Electronic Components........ 1.2%
Electronic Components..................... 14.3%
Energy Equipment.......................... 0.7%
Energy Sources............................ 1.1%
Finance/Multi-Industry.................... 2.3%
Financial Services........................ 1.0%
Food & Household.......................... 0.5%
Food Processors........................... 1.7%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Health Care............................... 3.1%
Industrial Components..................... 1.8%
Investments............................... 1.6%
Leisure & Tourism......................... 1.6%
Machinery & Engineering................... 6.7%
Merchandising............................. 4.0%
Office/Communication Equipment............ 1.7%
Oil....................................... 1.2%
Outdoor Advertising....................... 1.3%
Real Estate............................... 0.7%
Retailing -- Goods........................ 2.4%
Semiconductors/Components................. 1.6%
Software & EDP Services................... 3.0%
Technology/Multi-Industry................. 3.7%
Telecommunications........................ 3.7%
Telephone Utilities....................... 2.6%
Transportation -- Shipping................ 3.8%
Utilities................................. 0.5%
Other Assets in Excess of Liabilities..... 7.6%
------
TOTAL..................................... 100.0%
======
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
17
<PAGE> 21
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $55,931,455)......... $59,046,542
Cash.................................................... 4,960,097
Receivables:
Dividends.......................................... 26,571
Interest........................................... 27,816
Investment securities sold......................... 1,753,014
Fund shares sold................................... 52,775
Prepaid expenses........................................ 9,476
-----------
---------------------------------------------------------------------------
TOTAL ASSETS................................... 65,876,291
-----------
---------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 1,792,691
Due to affiliates.................................. 76,802
Net unrealized depreciation on unsettled foreign
currency forward contracts from transaction
hedges............................................. 3,736
Foreign taxes...................................... 4,958
Accrued expenses........................................ 102,677
-----------
---------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 1,980,864
-----------
---------------------------------------------------------------------------
NET ASSETS.................................................. $63,895,427
===========
SHARES OUTSTANDING.......................................... 2,065,157
===========
NET ASSET VALUE PER SHARE................................... $ 30.94
===========
===========================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 2000:
Paid-in capital......................................... $56,271,497
Undistributed net investment loss....................... (135,656)
Undistributed net realized gain......................... 4,817,770
Undistributed net realized foreign exchange loss........ (180,078)
Unrealized foreign exchange gain........................ 10,604
Unrealized appreciation on investments (net of foreign
withholding taxes payable of $3,797)................... 3,111,290
-----------
NET ASSETS..................................... $63,895,427
===========
===========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
18
<PAGE> 22
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTH PERIOD JANUARY 1, 2000 THROUGH JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (Net of non-reclaimable foreign taxes of
$16,856)........................................... $ 262,059
Interest........................................... 178,471
-----------
---------------------------------------------------------------------------
Total income..................................... 440,530
-----------
---------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 403,646
Administration fee................................. 57,000
Professional fees.................................. 21,739
Federal and state registration fees................ 22,541
Custodian fee...................................... 51,509
Transfer agent fees................................ 32,682
Trustees' fees..................................... 5,223
Miscellaneous...................................... 16,772
-----------
Total expenses before fees waived.................. 611,112
-----------
---------------------------------------------------------------------------
Administration fee waived.......................... (19,326)
Transfer agent fees waived......................... (15,600)
-----------
Total expenses net of fees waived................ 576,186
-----------
---------------------------------------------------------------------------
Net investment loss............................ (135,656)
-----------
---------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions............ 2,956,596
Net realized foreign exchange loss...................... (180,078)
Net change in unrealized foreign exchange gain.......... 8,992
Net change in unrealized appreciation of investments
(net of foreign withholding taxes payable of $3,797)... (7,468,645)
-----------
---------------------------------------------------------------------------
Net realized and unrealized loss on
investments.................................... (4,683,135)
-----------
---------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $(4,818,791)
===========
===========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
19
<PAGE> 23
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY FUND
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the six
month period
January 1, 2000 For the year
through ended
June 30, 2000 December 31,
(unaudited) 1999
----------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment loss..................................... $ (135,656) $ (156,694)
Net realized and unrealized gain (loss) on
investments........................................... (4,683,135) 14,366,431
------------ -----------
----------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations.................................. (4,818,791) 14,209,737
------------ -----------
----------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income................................... -- --
Capital gains........................................... -- (1,767,016)
------------ -----------
Total distributions to shareholders................ -- (1,767,016)
------------ -----------
----------------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold............................... 91,355,840 12,072,889
Reinvestment of distributions........................... -- 1,767,016
Cost of shares redeemed................................. (48,883,276) (40,982)
------------ -----------
Net increase in net assets derived from capital
share transactions............................... 42,472,564 13,798,923
------------ -----------
Total increase in net assets....................... 37,653,773 26,241,644
------------ -----------
----------------------------------------------------------------------------------------------
NET ASSETS:
----------------------------------------------------------------------------------------------
Beginning of period....................................... $ 26,241,654 $ 10
------------ -----------
End of period............................................. $ 63,895,427 $26,241,654
============ ===========
==============================================================================================
Capital share transactions are as follows:
Shares issued............................................. 2,513,465 858,953
Shares reinvested......................................... -- 71,568
Shares redeemed........................................... (1,377,099) (1,731)
------------ -----------
Net increase from capital share transactions....... 1,136,366 928,790
============ ===========
==============================================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
20
<PAGE> 24
--------------------------------------------------------------------------------
DRIEHAUS INTERNATIONAL DISCOVERY 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 six
month period
January 1, 2000
through For the year
June 30, 2000 ended
(unaudited) December 31, 1999
----------------------------------------------------------------------------------------------------
<S> <C> <C>
Net asset value, beginning of period........................ $ 28.25 $ 10.00
-------- --------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment loss....................................... (0.07) (0.17)
Net gains (losses) on investments (both realized and
unrealized)............................................. 2.76 21.14
-------- --------
Total income (loss) from investment operations..... 2.69 20.97
-------- --------
LESS DISTRIBUTIONS:
Dividends from net investment income...................... -- --
Distributions from capital gains.......................... -- (2.72)
-------- --------
Total distributions................................ -- (2.72)
-------- --------
Net asset value, end of period.............................. $ 30.94 $ 28.25
======== ========
Total Return....................................... 9.52%** 213.65%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000's)...................... $ 63,895 $ 26,242
Ratio of expenses to average net assets................... 2.14%*+ 2.43%+
Ratio of net investment loss to average net assets........ (0.50)%*+ (1.60)%+
Portfolio turnover........................................ 178.39%** 267.86%
Annualized portfolio turnover............................. 358.75% 267.86%
</TABLE>
--------------------------------------------------------------------------------
* Annualized
** Not Annualized
+ Such ratios are after administrative agent and transfer agent waivers and
Adviser expense reimbursements, when applicable. 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 thirty 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 June 30, 2001 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.
21
<PAGE> 25
--------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND -- PORTFOLIO MANAGER'S LETTER
--------------------------------------------------------------------------------
Dear Fellow Shareholders:
For the period January 1, 2000, through June 30, 2000, the Driehaus European
Opportunity Fund returned 17.30%. This compares with a return of -3.08% for the
Morgan Stanley Capital International Europe Index and 4.53% for the Lipper
European Region Fund Index for the first half of 2000. For this period, the fund
ranked 2nd among 157 funds listed in the Lipper European Region Fund peer
group.*
During the first 10 weeks of this year, we saw a continuation of the strong
price appreciation in growth shares that began in the fourth quarter of 1999.
This was followed by a sharp market correction that lasted until late May. The
correction in the technology, media, and telecommunications groups was long
overdue and much needed in order to restore the markets' health. Overvaluation
had become an issue in virtually every sector of the European markets where
growth was present. It now appears that European markets made a significant low
in late May, and since that time, performance has started to improve. The last
part of the year's first half was a relatively quieter period, characterized by
the beginnings of a recovery.
The balance of economic data coming from Europe in the first six months of
the year was mixed. From an investment standpoint, however, we have been
encouraged by the recent emergence of what seem to be several new themes as well
as the renewed focus on company quality, as seen in the emphasis on earnings and
sales. Investors also appear to have stopped chasing after stocks in whatever
segment of the market was deemed the "hottest." All of this created a better
environment for stock selection, which is one of the Driehaus strengths, and
several key sectors appeared to be demonstrating robust economic growth.
One of these was the advertising industry, due to advertising spending that
has grown much faster than the overall economy and driven by the development of
new products and services. This growth has been evident throughout the
continent. One of the fund's major holdings is M6 Metropole Television, a French
broadcasting company that has benefited from this trend.
We also increased our healthcare weighting to more than 12% of the fund.
This group has been a top performer since the market low in May, and we have
identified companies such as Shire Pharmaceuticals Group PLC in Great Britain
and two in Switzerland--Straumann Holding AG and Disetronic Holding AG, a fast-
growing hospital supply company.
In the past year, much of the interest in the small cap sector in Europe was
focused on companies involved in the Internet, which continues to be an
important engine of growth for economies around the world. However, from an
investor's perspective, it has become clear that such companies must deliver
strong, consistent earnings in the future if their share prices are to be
rewarded. The fund currently has virtually no direct exposure to the Internet
industry, and any future exposure will be focused on those companies with strong
business models and sustainable earnings growth. Overall, we cut our exposure to
the technology sector from a high of 55% in mid March to just over 35% on June
30.
In our opinion, now is an exciting time for growth stocks in Europe, with
the creation of several new exchanges over the past three years, including the
Nouveau Marche in France, Neuer Markt in Germany, and an entire small cap sector
in Scandinavia. This not only gives existing companies access to additional
capital, but also increases the number of new companies. During a recent trip to
Europe, our discussions with the head of one new German company indicated that
the existence of the Neuer Markt was instrumental in his decision to start his
own company.
22
<PAGE> 26
Our fund is focused on taking advantage of these new companies, new
industries, and new exchanges as they are being formed. While we do occasionally
find exciting ideas in the large cap sector, the breadth of opportunities
available from the growth area, especially in the small and mid-cap sectors, are
expanding very rapidly. So it is with optimism that we look forward to the rest
of the year 2000. While the correction of the past few months was sharp, we
believe the market environment is much healthier than it was prior to the
sell-off, and we are positive about the potential for growth stocks in Europe
going forward.
Sincerely,
William R Anderson
William R. Andersen
Portfolio Manager
August 24, 2000
---------------
* The Fund's total return for the six-month period ending June 30, 2000, was
ranked number two out of 157 funds by Lipper Analytical Services, Inc. in the
Lipper European Region Fund category.
23
<PAGE> 27
DRIEHAUS EUROPEAN OPPORTUNITY FUND
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS AS OF 6/30/00
-----------------------------------------------------------------------------------------------------------
DRIEHAUS EUROPEAN
OPPORTUNITY LIPPER EUROPEAN
FUND (DREOX) MSCI EUROPE INDEX REGION FUND INDEX
----------------- ----------------- -----------------
<S> <C> <C> <C>
One Year 192.34% 15.10% 32.33%
Since Inception (12/31/98 - 6/30/00) 115.61% 8.05% 21.10%
-----------------------------------------------------------------------------------------------------------
</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>
<S> <C> <C>
DREOX MSCI Europe Index
Dec 1998 10000.00 10000.00
Mar 1999 10880.00 10139.00
Jun 1999 14200.00 10397.00
Sept 1999 16570.00 10853.00
Dec 1999 31365.00 12696.00
Mar 2000 38550.00 11599.00
Jun 2000 31660.00 11232.00
<S> <C>
Lipper European Region Fund Index
Dec 1998 10000.00
Mar 1999 10375.00
Jun 1999 11780.00
Sept 1999 12703.00
Dec 1999 16292.00
Mar 2000 14049.00
Jun 2000 13327.00
</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.
24
<PAGE> 28
--------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 89.8%
----------------------------------------------------------
EUROPE -- 89.8%
SWITZERLAND -- 23.6%
Adecco SA................... 1,209 $ 1,030,505
Compagnie Financiere
Richemont AG.............. 355 959,507
Disetronic Holding AG....... 295 1,977,467
Distefora Holding AG........ 1,500 419,724
ESEC Holding AG............. 335 828,193
Gretag Imaging Group........ 4,495 868,001
Kudelski SA**............... 102 1,287,177
Logitech International
SA**...................... 1,425 1,017,438
Micronas Semiconductor
Holding AG**.............. 2,159 1,208,244
Serono SA -- B.............. 635 531,096
SEZ Holding AG.............. 1,600 1,469,063
Straumann Holding AG........ 680 1,024,556
Tecan AG.................... 950 911,984
------------
13,532,955
------------
UNITED KINGDOM -- 14.7%
Amvescap PLC................ 57,045 915,421
ARM Holdings PLC**.......... 86,000 921,783
Autonomy Corp. PLC**........ 6,364 770,044
Bookham Technology PLC**.... 14,575 848,623
Marconi PLC................. 69,000 898,348
Matalan PLC................. 65,000 506,778
Pace Micro Technology PLC... 58,610 847,368
Psion PLC................... 78,500 756,424
Shire Pharmaceuticals Group
PLC**..................... 76,000 1,316,245
The Sage Group PLC.......... 84,750 686,421
------------
8,467,455
------------
FRANCE -- 13.7%
Business Objects SA --
ADR**..................... 5,300 467,063
Credit Lyonnais SA.......... 23,980 1,144,751
Expand...................... 3,390 308,714
Galaries Lafayette.......... 5,295 1,078,592
M6 Metropole Television..... 19,100 1,164,456
Silicon-On-Insulator
Technologies**............ 975 228,983
Societe Television
Francaise 1............... 6,400 447,853
STMicroelectronics NV....... 28,360 1,794,248
Total Fina Elf SA........... 7,910 1,217,740
------------
7,852,400
------------
</TABLE>
<TABLE>
----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
GERMANY -- 13.0%
ADVA AG Optical
Networking**.............. 1,440 $ 815,798
Biodata Information
Technology AG**........... 2,900 978,528
Direkt Anlage Bank AG**..... 38,500 1,358,129
Evotec Biosystems AG**...... 10,020 904,797
Infineon Technologies
AG**...................... 19,700 1,612,711
Kamps AG.................... 29,000 925,709
Zapf Creation AG............ 13,865 850,613
------------
7,446,285
------------
NETHERLANDS -- 7.9%
ASM International NV**...... 30,055 792,286
ASM Lithography Holding
NV**...................... 11,100 479,028
ASM Lithography Holding
NV -- ADR**............... 26,126 1,152,810
BE Semiconductor Industries
NV**...................... 49,225 771,500
Koninklijke Ahold NV........ 45,090 1,332,558
------------
4,528,182
------------
FINLAND -- 6.8%
Elcoteq Network
Corp. -- A................ 22,190 488,172
Helsingin Puhelin Oyj....... 5,870 577,322
Nokia Corp. -- ADR.......... 17,144 856,130
Nokia Oyj................... 8,400 430,387
Perlos Oyj.................. 25,070 795,453
Sonera Oyj.................. 16,545 757,308
------------
3,904,772
------------
IRELAND -- 2.4%
Elan Corp. PLC -- ADR**..... 28,800 1,395,000
------------
ITALY -- 1.7%
Bulgari SpA................. 75,000 1,006,518
------------
SWEDEN -- 1.6%
NetCom AB -- B**............ 12,105 898,484
------------
NORWAY -- 1.5%
Opticom ASA**............... 2,845 306,552
Tomra Systems ASA........... 20,700 550,953
------------
857,505
------------
BELGIUM -- 1.5%
Audiofina**................. 6,605 854,750
------------
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
25
<PAGE> 29
--------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
SPAIN -- 1.4%
Sogecable SA**.............. 22,000 $ 784,931
------------
Total Europe................ 51,529,237
------------
----------------------------------------------------------
TOTAL INVESTMENTS
(COST $47,603,151).......... 89.8% $ 51,529,237
Other Assets in Excess of
Liabilities................. 10.2% 5,844,824
---------- ------------
Net Assets...................... 100.0% $ 57,374,061
==========================================================
The federal income tax basis and unrealized appreciation
(depreciation) for all investments is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis.................................... $ 47,603,151
============
Gross Appreciation....................... $ 6,073,590
Gross Depreciation....................... (2,147,504)
------------
Net Appreciation....................... $ 3,926,086
============
** Non-income producing security.
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
26
<PAGE> 30
--------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS BY INDUSTRY
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Banking................................... 2.0%
Basic Industries/Multi-Industry........... 1.7%
Biotechnology............................. 2.5%
Broadcast & Publishing Services........... 6.2%
Business & Publishing Services............ 1.8%
Consumer Non-Durables/Multi-Industry...... 1.5%
Drugs..................................... 2.4%
Electrical................................ 3.8%
Electronic Components..................... 14.0%
Electronic Systems/Devices................ 5.0%
Energy Sources............................ 2.1%
Financial Services........................ 4.0%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Health Care............................... 4.1%
Hospital Supplies......................... 3.4%
Machinery & Engineering................... 4.5%
Merchandising............................. 3.9%
Miscellaneous Materials................... 1.4%
Retailing -- Foods........................ 1.6%
Retailing -- Goods........................ 3.6%
Semiconductors/Components................. 8.8%
Software & EDP Services................... 3.4%
Technology/Multi-Industry................. 4.2%
Telecommunications........................ 3.9%
Other Assets in Excess of Liabilities..... 10.2%
------
TOTAL..................................... 100.0%
======
</TABLE>
Notes to Financial Statements are an integral part of this Schedule.
27
<PAGE> 31
--------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $47,603,151)......... $51,529,237
Cash.................................................... 4,333,873
Receivables:
Dividends.......................................... 27,024
Interest........................................... 24,715
Investment securities sold......................... 2,774,278
Fund shares sold................................... 26,535
Prepaid expenses........................................ 10,567
-----------
---------------------------------------------------------------------------
TOTAL ASSETS................................... 58,726,229
-----------
---------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 1,081,808
Fund shares redeemed............................... 114,729
Due to affiliates.................................. 73,067
Net unrealized depreciation on unsettled foreign
currency forward contracts
from transaction hedges.......................... 2,283
Accrued expenses........................................ 80,281
-----------
---------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 1,352,168
-----------
---------------------------------------------------------------------------
NET ASSETS.................................................. $57,374,061
===========
SHARES OUTSTANDING.......................................... 1,812,387
===========
NET ASSET VALUE PER SHARE................................... $ 31.66
===========
===========================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 2000:
Paid-in capital......................................... $51,969,160
Undistributed net investment loss....................... (331,971)
Undistributed net realized gain......................... 2,229,993
Undistributed net realized foreign exchange loss........ (434,709)
Unrealized foreign exchange gain........................ 15,502
Unrealized appreciation on investments.................. 3,926,086
-----------
NET ASSETS..................................... $57,374,061
===========
===========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
28
<PAGE> 32
--------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
STATEMENT OF OPERATIONS
FOR THE SIX MONTH PERIOD JANUARY 1, 2000 THROUGH JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (Net of non-reclaimable foreign taxes of
$1,290)............................................ $ 82,757
Interest........................................... 163,148
-----------
---------------------------------------------------------------------------
Total income..................................... 245,905
-----------
---------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 421,423
Administration fee................................. 57,000
Professional fees.................................. 16,776
Federal and state registration fees................ 26,623
Custodian fees..................................... 37,640
Transfer agent fees................................ 29,094
Trustees' fees..................................... 5,244
Miscellaneous...................................... 15,086
Interest........................................... 2,257
-----------
Total expenses before fees waived.................. 611,143
-----------
---------------------------------------------------------------------------
Administration fee waived.......................... (17,667)
Transfer agent fees waived......................... (15,600)
-----------
Total expenses net of fees waived................ 577,876
-----------
---------------------------------------------------------------------------
Net investment loss............................ (331,971)
-----------
---------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions............ 1,420,883
Net realized foreign exchange loss...................... (434,709)
Net change in unrealized foreign exchange gain.......... 15,891
Net change in unrealized appreciation of investments.... (5,927,334)
-----------
---------------------------------------------------------------------------
Net realized and unrealized loss on
investments.................................... (4,925,269)
-----------
---------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $(5,257,240)
===========
===========================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
29
<PAGE> 33
--------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY FUND
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the six month period
January 1, 2000
through For the year
June 30, 2000 ended
(unaudited) December 31, 1999
-------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment loss................................ $ (331,971) $ (89,757)
Net realized and unrealized gain (loss) on
investments...................................... (4,925,269) 10,751,898
------------- -----------
-------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations.............................. (5,257,240) 10,662,141
------------- -----------
-------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income.............................. -- --
Capital gains...................................... -- --
------------- -----------
Total distributions to shareholders............ -- --
------------- -----------
-------------------------------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold.......................... 141,823,681 11,536,927
Reinvestment of distributions...................... -- --
Cost of shares redeemed............................ (101,189,670) (201,788)
------------- -----------
Net increase in net assets derived from capital
share transactions........................... 40,634,011 11,335,139
------------- -----------
Total increase in net assets................... 35,376,771 21,997,280
------------- -----------
-------------------------------------------------------------------------------------------------------------
NET ASSETS:
-------------------------------------------------------------------------------------------------------------
Beginning of period..................................... $ 21,997,290 $ 10
------------- -----------
End of period........................................... $ 57,374,061 $21,997,290
============= ===========
=============================================================================================================
Capital share transactions are as follows:
Shares issued...................................... 3,697,370 822,951
Shares reinvested.................................. -- --
Shares redeemed.................................... (2,700,107) (7,828)
------------- -----------
Net increase from capital share transactions... 997,263 815,123
============= ===========
=============================================================================================================
</TABLE>
Notes to Financial Statements are an integral part of this Statement.
30
<PAGE> 34
--------------------------------------------------------------------------------
DRIEHAUS EUROPEAN OPPORTUNITY 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 six
month period
January 1, 2000
through For the year
June 30, 2000 ended
(unaudited) December 31, 1999
-------------------------------------------------------------------------------------------------
<S> <C> <C>
Net asset value, beginning of period........................ $ 26.99 $ 10.00
------- -------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment loss....................................... (0.18) (0.11)
Net gains (losses) on investments (both realized and
unrealized)............................................. 4.85 17.10
------- -------
Total income (loss) from investment operations..... 4.67 16.99
------- -------
LESS DISTRIBUTIONS:
Dividends from net investment income...................... -- --
Distributions from capital gains.......................... -- --
------- -------
Total distributions................................ -- --
------- -------
Net asset value, end of period.............................. $ 31.66 $ 26.99
======= =======
Total Return....................................... 17.30%** 169.90%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in 000's)...................... $57,374 $21,997
Ratio of expenses to average net assets................... 2.06%*+ 2.10%+
Ratio of net investment loss to average net assets........ (1.18)%*+ (1.26)%+
Portfolio turnover........................................ 229.29%** 214.90%
Annualized portfolio turnover............................. 461.11% 214.90%
</TABLE>
--------------------------------------------------------------------------------
* Annualized
** Not Annualized
+ Such ratios are after administrative agent and transfer agent waivers and
Adviser expense reimbursements, when applicable. 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 thirty months of its operations. For the period from December
31, 1998 (the commencement of operations) through June 30, 2001 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.
31
<PAGE> 35
--------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND -- PORTFOLIO MANAGER'S LETTER
--------------------------------------------------------------------------------
Dear Fellow Shareholders:
For the period from January 1, 2000, through June 30, 2000, the Driehaus
Asia Pacific Growth Fund returned -15.10%. This compares with a return of -5.76%
for the Morgan Stanley Capital International Asia/ Pacific Index and -14.41% for
the Lipper Pacific Region Fund Index for the first half of 2000. For this
period, the Driehaus Asia Pacific Growth Fund ranked 41st among the 61 funds in
its Lipper Pacific Region Fund peer group.*
Asian markets showed strong performance in the first quarter of
2000--largely echoing the Nasdaq lead in the U.S.--but by early March,
valuations in most sectors reached unsustainable levels. During the first three
months of the year, the fund's large weighting in technology and
telecommunications (70% at the beginning of the year) helped performance, as the
fund gained 6.06% for the first quarter. In particular, several of the fund's
technology holdings during this period, including Himachal Futuristic
Communications, Ltd., a telecommunications engineering company in India, and
Mesiniaga Berhad, a Malaysian information technology services company, performed
well.
Although we succeeded in selling our most overvalued Japanese stocks, such
as Hikari Tsushin, Inc. and Softbank Corp., in January before they collapsed, we
reinvested the proceeds into new Nasdaq-style markets in South Korea and Taiwan,
which did not perform as well as expected. With the correction in the U.S.
Nasdaq market in March, the fund ended up losing 19.95% in the second quarter.
By April, the fund had cut its technology and telecommunications weightings to
34% and invested in more reasonably priced stocks in a variety of sectors,
including capital goods, consumer services, and healthcare.
Politics also had an adverse effect on the markets this year. In March, a
new pro-independence government was elected in Taiwan, which led to military
threats by China that hurt investor confidence. In Japan, Prime Minister Keizo
Obuchi unexpectedly died, and his successor, Yoshiro Mori, appears less willing
to push forward Obuchi's reform agenda. Southeast Asia, namely Indonesia and the
Philippines, became marginalized following the installation of new leadership
that was perceived as ineffective.
During the first half of 2000, investor interest was dominated by the
countries of northeast Asia (South Korea, Hong Kong, and Taiwan) due to their
greater roles in the electronics industry. However, even though these countries
boast many internationally competitive companies, such as Samsung Electronics,
continued delays in the cleanup of South Korea's financial system hurt the
markets in this area.
Although we believe that 2000 will be a year that favors stock selection
rather than sector bets, we like several themes for the rest of the year in
Asia:
- Capital spending is recovering in Japan. Following a two-year freeze due to
the Asian crisis, Japanese companies have started to reinvest in new
factories, especially in the semiconductor and auto-related fields. For
example, Daikin Industries, Ltd., a Japanese industrial air conditioner maker,
saw a 17.50% jump in second-quarter sales.
- China's economy is accelerating. In the first half of 2000, Chinese GDP growth
rose 8.20% after posting a gain of 7.10% in 1999, and exports rose 38% in the
January-June period. From our meetings with Chinese analysts, we discovered
that the Chinese government had clamped down on monetary policy in 1998-99 to
prevent a currency collapse similar to that in Thailand. Now that the rest of
Asia has recovered, the central bank has cut interest rates to boost growth.
Moreover, the preliminary approval of China's membership into the World Trade
Organization has led to increased confidence about the future of the private
sector in China. One of the fund's new additions is Cosco Pacific, Ltd., a
port operator in China and Hong Kong, which saw trade increase by 38% in
April, 2000.
- Asian pharmaceutical companies are finally starting to achieve success in
launching new products. Daiichi Pharmaceutical Co., Ltd., a Japanese drug
company, launched a new antibiotic drug, Cravit, that saw sales to the U.S.
rise 91% in 1999. Another recent addition to the fund was Cochlear, Ltd., an
Australian hearing aid company that has the largest market share in the U.S.
for the severely hearing-impaired market.
One stock we sold in the first half was Communication Network Interface,
Inc., a South Korean small cap manufacturer of handheld pagers that allow stock
trading. Despite South Korea's status as the country with the
32
<PAGE> 36
highest penetration of online day traders (about 50% of total trades) the
company failed to sign any deals to export their pagers abroad.
1999 was such an exceptional year for Asia's stock markets--with increasing
confidence in the Asian economic recovery--that valuations and expectations for
2000 rose too high. This year has been one of transition to a lower post-crisis
period of 5-6% GDP growth and 15-20% earnings-per-share growth. We believe that
much of the bad news has already been factored into the markets, and the second
half of 2000 should show some improvement.
Sincerely,
Eric J. Ritter
Eric J. Ritter, CFA
Portfolio Manager
August 24, 2000
---------------
* The Fund's total return for the six-month period ending June 30, 2000, was
ranked number 41 out of 61 funds by Lipper Analytical Services, Inc. in the
Lipper Pacific Region Fund category.
33
<PAGE> 37
DRIEHAUS ASIA PACIFIC GROWTH FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 6/30/00
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DRIEHAUS ASIA
PACIFIC GROWTH LIPPER PACIFIC
FUND MSCI ASIA REGION FUND
(DRAPX) PACIFIC INDEX INDEX
-------------- ------------- --------------
<S> <C> <C> <C>
One Year 80.85% 18.71% 14.96%
Since Inception (12/31/97 -- 6/30/00) 56.49% 18.70% 17.02%
</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
DRAPX MSCI ASIA PACIFIC INDEX FUND INDEX
----- ----------------------- ---------------------
<S> <C> <C> <C>
Dec 1997 10000.00 10000.00 10000.00
Mar 1998 9950.00 10462.00 10282.00
Jun 1998 8500.00 9261.00 8880.00
Sept 1998 8300.00 8058.00 8081.00
Dec 1998 9900.00 10203.00 9705.00
Mar 1999 12160.00 11336.00 10443.00
Jun 1999 16940.00 12932.00 12887.00
Sept 1999 21940.00 13984.00 13647.00
Dec 1999 36084.00 16290.00 17308.00
Mar 2000 38271.00 16455.00 16825.00
Jun 2000 30635.00 15352.00 14815.00
</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.
34
<PAGE> 38
--------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
SCHEDULE OF INVESTMENTS
JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 72.7%
----------------------------------------------------------
FAR EAST -- 72.7%
JAPAN -- 41.2%
Canon, Inc. ................. 15,000 $ 748,572
Central Glass Co., Ltd....... 240,000 1,277,108
Daifuku Co., Ltd............. 60,000 666,909
Daiichi Pharmaceutical Co.,
Ltd........................ 44,000 1,118,699
Daikin Industries, Ltd....... 45,000 1,048,426
Dainippon Pharmaceutical Co.,
Ltd........................ 83,000 1,109,266
Eisai Co., Ltd............... 18,000 578,442
Hisamitsu Pharmaceutical Co.,
Inc. ...................... 28,000 431,638
Hisamitsu Pharmaceutical Co.,
Inc. -- New**.............. 28,000 431,638
Kirin Beverage Corp.......... 16,000 426,459
Mitsubishi Electric Corp..... 40,000 434,020
Mitsui O.S.K Lines, Ltd...... 206,000 478,972
Net One Systems Co., Ltd..... 5 126,841
Nihon Dempa
Kogyo Co., Ltd............. 10,000 519,841
Nippon Foundry, Inc.**....... 25 432,414
Nippon Sheet Glass Co.,
Ltd........................ 76,000 1,058,813
Nippon Thompson Co., Ltd..... 70,000 1,065,202
Nissan Motor Co., Ltd.**..... 1,000 5,907
Pioneer Corp................. 14,000 546,495
Sanyo Electric Co., Ltd...... 78,000 703,317
Square Co., Ltd.............. 1,350 99,781
Sumitomo Bakelite Co.,
Ltd........................ 34,000 448,935
Tokyo Denpa Co., Ltd......... 900 56,313
Toys "R" Us -- Japan,
Ltd.**..................... 7,000 1,190,909
-----------
15,004,917
-----------
HONG KONG -- 7.9%
ASM Pacific Technology,
Ltd........................ 152,000 569,388
Cosco Pacific, Ltd........... 546,000 430,774
Giordano International,
Ltd........................ 360,000 547,272
Johnson Electric Holdings,
Ltd.**..................... 100,000 946,116
Li & Fung, Ltd............... 80,000 400,255
-----------
2,893,805
-----------
SOUTH KOREA -- 7.0%
Cheil Communications,
Inc. ...................... 5,010 653,778
HandySoft Corp.**............ 8,479 249,810
Hyundai Electronics
Industries Co., Ltd.**..... 26,000 513,010
Jang Media Interactive
Corp....................... 744 14,280
Samsung Electronics.......... 2,051 678,769
Samsung SDI Co., Ltd......... 9,230 442,879
-----------
2,552,526
-----------
AUSTRALIA -- 5.4%
APN News & Media, Ltd........ 3,236 7,844
Cochlear, Ltd................ 22,000 379,871
CSL, Ltd..................... 23,650 469,095
ERG, Ltd..................... 29,000 225,836
MYOB, Ltd.................... 118,199 361,232
Novus Petroleum, Ltd.**...... 490,000 518,096
-----------
1,961,974
-----------
</TABLE>
<TABLE>
----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
SINGAPORE -- 4.4%
Chartered Semiconductor
Manufacturing, Ltd.**...... 111,000 $ 969,416
Neptune Orient Lines,
Ltd.**..................... 700,000 647,781
-----------
1,617,197
-----------
TAIWAN -- 3.1%
Macronix International Co.,
Ltd.**..................... 24,830 62,077
Realtek Semiconductor
Corp....................... 91,000 759,343
Stark Technology, Inc.**..... 23,000 306,179
-----------
1,127,599
-----------
CHINA -- 1.5%
Zhenhai Refining and Chemical
Co., Ltd................... 3,526,000 547,331
-----------
NEW ZEALAND -- 1.2%
Fletcher Challenge Energy.... 130,000 425,323
-----------
MALAYSIA -- 1.0%
Digi.com Berhad**............ 204,500 374,028
-----------
Total Far East............... 26,504,700
-----------
Total Equity Securities (Cost
$22,745,839)............... 26,504,700
-----------
----------------------------------------------------------
EQUITY PARTICIPATION NOTES -- 4.7% (Note C)
----------------------------------------------------------
INDIA -- 4.7%
Himachal Futuristic
Communications, Ltd.
(Series A)**+.............. 14,003 446,694
Satyam Computer Services,
Ltd. (Series C)**+......... 6,700 446,956
Sri Adhikari Brothers
Television Network, Ltd.
(Series A)**+.............. 19,182 247,187
Sun Pharmaceutical
Industries, Ltd. (Series
A)**+...................... 36,000 432,522
Television Eighteen India,
Ltd. (Series A)**+......... 9,500 129,226
-----------
1,702,585
-----------
Total Equity Participation
Notes (Cost $1,664,591).... 1,702,585
-----------
----------------------------------------------------------
TOTAL INVESTMENTS (COST
$24,410,430)................. 77.4% $28,207,285
Other Assets in Excess of
Liabilities.................. 22.6% 8,251,490
--------- -----------
Net Assets....................... 100.0% $36,458,775
==========================================================
The federal income tax basis and unrealized appreciation
(depreciation) for all investments is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis..................................... $ 24,410,430
============
Gross Appreciation*....................... $ 4,001,217
Gross Depreciation........................ (204,362)
------------
Net Appreciation........................ $ 3,796,855
============
*Exclusive of foreign withholding taxes
payable of $20,535.
**Non-income producing security.
+Restricted security.
</TABLE>
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, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Appliances............................. 3.4%
Beverages & Tobacco.................... 1.2%
Broadcast & Publishing Services........ 2.9%
Building Materials..................... 1.2%
Clothing............................... 1.5%
Chemicals.............................. 6.2%
Consumer Services/Multi-Industry....... 2.0%
Data Processing........................ 2.0%
Electrical & Electronics............... 5.2%
Electronic Components.................. 5.6%
Electronic Systems/Devices............. 1.9%
Energy Sources......................... 1.4%
Health Care............................ 12.5%
Investments............................ 1.1%
Industrial Components.................. 4.7%
Machinery & Engineering................ 4.7%
Medical Supplies....................... 1.0%
Miscellaneous Materials................ 2.9%
Retailing -- Goods..................... 3.3%
Semiconductors/Components.............. 4.1%
Technology/Multi-Industry.............. 3.2%
Telecommunications..................... 2.3%
Transportation -- Shipping............. 3.1%
Other Assets in Excess of
Liabilities.......................... 22.6%
------
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, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $24,410,430)......... $28,207,285
Foreign currency (Cost $1,233,610)...................... 1,233,981
Cash.................................................... 6,746,743
Receivables:
Dividends.......................................... 8,622
Interest........................................... 19,552
Investment securities sold......................... 4,050,132
Fund shares sold................................... 2,113,900
Net unrealized appreciation on unsettled foreign
currency forward contracts from transaction
hedges............................................. 5,775
Prepaid expenses........................................ 11,205
Deferred organizational costs........................... 14,661
-----------
---------------------------------------------------------------------------
TOTAL ASSETS................................... 42,411,856
-----------
---------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 1,147,980
Fund shares redeemed............................... 4,636,206
Due to affiliates.................................. 54,712
Foreign taxes...................................... 20,907
Accrued expenses........................................ 93,276
-----------
---------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 5,953,081
-----------
---------------------------------------------------------------------------
NET ASSETS.................................................. $36,458,775
===========
SHARES OUTSTANDING.......................................... 1,377,014
===========
NET ASSET VALUE PER SHARE................................... $ 26.48
===========
===========================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 2000:
Paid-in capital......................................... $27,082,696
Undistributed net investment loss....................... (281,387)
Undistributed net realized gain......................... 6,327,424
Undistributed net realized foreign exchange loss........ (451,348)
Unrealized foreign exchange gain........................ 5,070
Unrealized appreciation on investments (net of foreign
withholding taxes payable of $20,535).................. 3,776,320
-----------
NET ASSETS..................................... $36,458,775
===========
===========================================================================
</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, 2000 THROUGH JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (Net of non-reclaimable foreign taxes of
$6,890)........................................... $ 116,746
Interest........................................... 69,346
Other.............................................. 415
-----------
-------------------------------------------------------------------------------
Total income..................................... 186,507
-----------
-------------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 293,313
Administration fee................................. 57,000
Professional fees.................................. 21,826
Federal and state registration fees................ 15,311
Custodian fee...................................... 52,904
Transfer agent fees................................ 24,420
Trustees' fees..................................... 4,555
Amortization of organization costs................. 2,919
Miscellaneous...................................... 20,166
Interest........................................... 11,104
-----------
Total expenses before fees waived.................. 503,518
-----------
-------------------------------------------------------------------------------
Administration fee waived.......................... (29,624)
Transfer agent fees waived......................... (6,000)
-----------
Total expenses net of fees waived................ 467,894
-----------
-------------------------------------------------------------------------------
Net investment loss............................ (281,387)
-----------
-------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions............ 2,130,984
Net realized foreign exchange loss...................... (451,348)
Net change in unrealized foreign exchange gain.......... 4,990
Net change in unrealized appreciation of investments
(net of foreign withholding taxes payable of
$20,535)............................................... (6,731,856)
-----------
-------------------------------------------------------------------------------
Net realized and unrealized loss on
investments.................................... (5,047,230)
-----------
-------------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $(5,328,617)
===========
===============================================================================
</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 six month period
January 1, 2000
through For the year
June 30, 2000 ended
(unaudited) December 31, 1999
----------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment loss................................. $ (281,387) $ (219,435)
Net realized and unrealized gain (loss) on
investments....................................... (5,047,230) 17,822,959
------------ -----------
----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations............................... (5,328,617) 17,603,524
------------ -----------
----------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income............................... -- --
Capital gains....................................... -- (3,257,162)
------------ -----------
Total distributions to shareholders............. -- (3,257,162)
------------ -----------
----------------------------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold........................... 118,256,400 13,766,077
Reinvestment of distributions....................... -- 3,257,162
Cost of shares redeemed............................. (106,501,071) (6,302,441)
------------ -----------
Net increase in net assets derived from capital
share transactions............................ 11,755,329 10,720,798
------------ -----------
Total increase in net assets.................... 6,426,712 25,067,160
------------ -----------
----------------------------------------------------------------------------------------------------------
NET ASSETS:
----------------------------------------------------------------------------------------------------------
Beginning of period..................................... $ 30,032,063 $ 4,964,903
------------ -----------
End of period........................................... $ 36,458,775 $30,032,063
============ ===========
==========================================================================================================
Capital share transactions are as follows:
Shares issued....................................... 4,139,675 674,329
Shares reinvested................................... -- 117,928
Shares redeemed..................................... (3,725,402) (330,928)
------------ -----------
Net increase from capital share transactions.... 414,273 461,329
============ ===========
==========================================================================================================
</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
For the six from the
month period For the three commencement
January 1, 2000 month period of operations
through For the year October 1, 1998 December 31, 1997
June 30, 2000 ended through through
(unaudited) December 31, 1999 December 31, 1998 September 30, 1998
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net asset value, beginning of
period......................... $ 31.19 $ 9.90 $ 8.30 $ 10.00
------- ------- ------- -------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment loss............ (0.20) (0.23) (0.04) (0.02)
Net gains (losses) on
investments (both realized
and unrealized).............. (4.51) 25.85 1.64 (1.68)
------- ------- ------- -------
Total income (loss) from
investment
operations............ (4.71) 25.62 1.60 (1.70)
------- ------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment
income....................... -- -- -- --
Distributions from capital
gains........................ -- (4.33) -- --
------- ------- ------- -------
Total distributions..... -- (4.33) -- --
------- ------- ------- -------
Net asset value, end of period... $ 26.48 $ 31.19 $ 9.90 $ 8.30
======= ======= ======= =======
Total Return............ (15.10)%** 264.49% 19.28%** (17.00)%**
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
000's)....................... $36,459 $30,032 $ 4,965 $ 3,582
Ratio of expenses to average
net assets................... 2.39%*+ 2.60%+ 2.95%*+ 2.95%*+
Ratio of net investment loss to
average net assets........... (1.44)%*+ (1.88)%+ (2.64)%*+ (0.45)%*+
Portfolio turnover............. 351.47%** 362.55% 92.40%** 283.59%**
Annualized portfolio
turnover..................... 706.81% 362.55% 366.60% 379.16%
</TABLE>
--------------------------------------------------------------------------------
* Annualized
** Not Annualized
+ Such ratios are after administrative agent and transfer agent waivers and
Adviser expense reimbursements, when applicable. 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 forty-two 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 June 30, 2001 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 January 1, 2000, through June 30, 2000, the Driehaus Emerging
Markets Growth Fund returned -0.05%. This compares with a return of -5.00% for
the Morgan Stanley Capital International Emerging Markets Index and -9.60% for
the Lipper Emerging Markets Fund Index for the first six months of 2000. For
this period, the Driehaus Emerging Markets Growth Fund ranked 7th among the 198
funds in the Lipper Emerging Markets Fund peer group.*
Like most markets worldwide, the emerging markets began the year with strong
first-quarter performance, particularly in technology, media, and
telecommunications shares. There seemed to be an especially high correlation
between the Nasdaq market in the U.S. and emerging markets this year, due
largely to the major technology and telecommunications components of all these
markets. Consequently, as high valuations, continued interest rate hikes, and
inflation fears triggered a correction in the U.S. market in March, emerging
markets worldwide also saw a general sell-off. By late May, these markets had
started to recover in response to tentative signs of an economic slowdown in the
U.S.
The fund started the year with large weightings in technology, media, and
telecommunications. However, with the market correction, we sold many of our
holdings in these areas that had high valuations and/or earnings
disappointments. By the end of the first half, we had reduced the fund's
technology allocation to less than 17% from 30% at the end of 1999. The proceeds
from these sales were reinvested in more timely growth ideas outside of
technology, mainly consumer non-durables, capital goods, and transportation.
From a regional perspective, the fund had a substantial position in Latin
America, where we particularly like the outlook for Mexico and Brazil. In
Mexico, we believe the recent election of opposition leader Vicente Fox, as well
as the peaceful transition to a new government, bodes well for the country's
political and economic climate. Since the election, the country's GDP growth has
accelerated, the currency has strengthened, and inflation projections are
expected to decline. In addition, the recent rise in oil prices has boosted
Mexico's reserves, which should increase spending on such items as
infrastructure and education. With more diversified manufacturing and export
industries, the only cloud on the horizon appears to be the chance of further
interest rate increases in the U.S., which could have a negative impact on the
closely-tied Mexican economy. One of our successful Mexican holdings is Grupo
Televisa SA, the largest broadcaster in Mexico, with a market share of about
75%. The company, which is also the largest producer of Spanish-language content
in the world, is benefiting from a substantial increase in advertising spending.
In Brazil, we expect to see robust GDP growth continue over the next few
years, inflation to fall, and interest rates to decline from their current
levels of about 18%. Strong corporate earnings, with earnings upgrades across
Brazil as a whole, should result in good prospects for the stock market there.
Rising oil prices, corporate restructuring, and exploration and production
growth benefited one of our larger holdings there, Petroleo Brasileiro SA, the
state-owned oil monopoly.
Over the first half, we also increased our allocation to China, through
direct investments in the Chinese market as well as China-related shares in Hong
Kong, based on the country's accelerating economy and improved sentiment
following World Trade Organization approval. Two of our holdings in this market
included China Shipping Development Co., Ltd., which has benefited from China's
growing exports to other Asian countries, and China Unicom, Ltd., the second
cellular phone company to be licensed in China.
Other markets we favored during the first half included Israel, especially
that country's technology sector, and South Korea, where companies are
demonstrating solid earnings growth with reasonable valuations following the
March correction. On the other hand, valuations in Turkey remain stretched
following a major run-up in that stock market. Accordingly, we sold our
positions in Alcatel, Aksigorta AS, and Haci Omer Sabanci Holding AS. We also
reduced our exposure to South Africa due to a weaker currency, increased
inflation fears, disappointing GDP growth, and political problems in neighboring
countries.
41
<PAGE> 45
In our opinion, the overall outlook for emerging markets is fairly positive.
Valuations remain reasonable, and earnings growth looks strong for the remainder
of 2000 and into 2001. Given a neutral-to-positive equity environment in the
U.S., we expect emerging markets to continue to perform well.
Sincerely,
Emery R. Brewer
Emery R. Brewer
Portfolio Manager
August 24, 2000
---------------
* The fund's total return for the six-month period ending June 30, 2000, was
ranked number seven out of 198 funds by Lipper Analytical Services, Inc. in the
Lipper Emerging Markets Fund category. During the period, the adviser reimbursed
a portion of the fund's expenses; otherwise, the fund's returns and ranking may
have been lower.
42
<PAGE> 46
DRIEHAUS EMERGING MARKETS GROWTH FUND
AVERAGE ANNUAL TOTAL RETURNS AS OF 6/30/00
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DRIEHAUS EMERGING
MARKETS GROWTH MSCI EMERGING LIPPER EMERGING
FUND (DREGX) MARKETS INDEX MARKETS FUND INDEX
----------------- ------------- ------------------
<S> <C> <C> <C>
One Year 52.79% 12.72% 13.07%
Since Inception (12/31/97 -- 6/30/00) 28.41% 8.69% 4.53%
</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 MARKETS LIPPER EMERGING
DREGX INDEX MARKETS FUND INDEX
----- --------------------- ------------------
<S> <C> <C> <C>
Dec 1997 10000.00 10000.00 10000.00
Mar 1998 10550.00 10722.00 10512.00
Jun 1998 9520.00 8183.00 8300.00
Sept 1998 7560.00 6504.00 6331.00
Dec 1998 8730.00 7679.00 7313.00
Mar 1999 9380.00 8663.00 7894.00
Jun 1999 12230.00 10926.00 9880.00
Sept 1999 11480.00 10374.00 9190.00
Dec 1999 18696.00 12964.00 12357.00
Mar 2000 22169.00 13603.00 12614.00
Jun 2000 18686.00 12316.00 11171.00
</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, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
EQUITY SECURITIES -- 85.3%
----------------------------------------------------------
FAR EAST -- 39.5%
SOUTH KOREA -- 12.2%
Cheil Communications,
Inc. ..................... 3,757 $ 490,268
Daum Communications
Corp.**................... 2,000 190,137
Garnet Systems Co.,
Ltd.**.................... 22,028 223,256
Hanjin Transportation Co.... 753 9,457
Hite Brewery Co., Ltd....... 10,900 479,018
Insung Information Co.,
Ltd.**.................... 280 4,282
Kookmin Bank................ 23,630 300,941
Korea Electric Power (KEP)
Corp. -- ADR.............. 14,900 274,719
LG Ad, Inc. ................ 3,200 204,056
Samsung Electronics --
GDR+...................... 2,670 523,320
Samsung SDI Co., Ltd........ 5,000 239,913
SK Telecom Co., Ltd. --
ADR....................... 8,900 323,181
Trigem Computer, Inc. ...... 718 14,393
------------
3,276,941
------------
TAIWAN -- 7.7%
Advantech Co., Ltd.......... 5,700 30,167
Ambit Microsystems Corp..... 24,000 237,670
Asustek Computer, Inc. --
GDR....................... 13 126
Bank Sinopac................ 529,000 340,082
Hon Hai Precision Industry
Co., Ltd.**............... 41,000 370,077
Realtek Semiconductor
Corp...................... 42,000 350,466
Systex Corp.**.............. 8,160 28,614
Taiwan Semiconductor
Manufacturing Co., Ltd. --
ADR**..................... 8,478 328,558
Via Technologies, Inc.**.... 15,000 231,339
Windbond Electronics
Corp. -- GDR**............ 5,500 158,125
------------
2,075,224
------------
HONG KONG -- 5.1%
ASM Pacific Technology,
Ltd....................... 65,000 243,489
China Mobile Hong Kong,
Ltd.**.................... 920 163,587
China Unicom, Ltd. --
ADR**..................... 15,100 320,875
Cosco Pacific, Ltd.......... 300,000 236,689
Giordano International,
Ltd....................... 179,363 272,668
Phoenix Satellite Television
Holdings, Ltd.**.......... 1,000,000 138,550
------------
1,375,858
------------
</TABLE>
<TABLE>
----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
CHINA -- 4.5%
China Shipping Development
Co., Ltd.**............... 2,834,000 $ 516,262
Jinzhou Port Co., Ltd.**.... 600,000 225,600
PetroChina Co., Ltd. --
ADR**..................... 12,100 253,344
Shandong Huaneng Power Co.,
Ltd. -- ADR............... 52,000 217,750
------------
1,212,956
------------
SINGAPORE -- 2.7%
Chartered Semiconductor
Manufacturing, Ltd. --
ADR**..................... 2,950 265,500
Neptune Orient Lines,
Ltd.**.................... 500,000 462,701
------------
728,201
------------
THAILAND -- 2.4%
Siam City Cement Public Co.,
Ltd. (Foreign)**.......... 73,000 275,446
TelecomAsia Corporation
Public Co., Ltd.
(Foreign)**............... 208,300 231,009
Thai Farmers Bank Public
Co., Ltd. (Foreign)**..... 160,000 134,612
------------
641,067
------------
INDIA -- 2.0%
Reliance Industries, Ltd. --
GDR+...................... 13,000 273,000
Videsh Sanchar Nigam,
Ltd. -- GDR............... 17,500 273,438
------------
546,438
------------
MALAYSIA -- 1.4%
Digi.com Berhad**........... 116,000 212,162
Mesiniaga Berhad............ 66,000 173,688
------------
385,850
------------
PHILIPPINES -- 0.9%
Filinvest Land, Inc.**...... 5,500,000 239,193
------------
INDONESIA -- 0.6%
Gulf Indonesia Resources,
Ltd.**.................... 19,100 152,800
------------
Total Far East.............. 10,634,528
------------
</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, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
EUROPE -- 14.5%
TURKEY -- 3.1%
Dogan Yayin Holding AS**.... 11,514,000 $ 195,159
Global Menkul Degerler
AS**...................... 14,762,000 204,935
Vestel Elektronik Sanayi Ve
Ticaret AS**.............. 670,000 202,791
Yapi ve Kredi Bankasi AS --
GDR....................... 20,000 222,022
------------
824,907
------------
POLAND -- 2.7%
Art Marketing Syndicate
SA**...................... 16,063 230,533
Netia Holdings SA -- ADR**.. 11,000 299,200
Prokom Software SA -- GDR... 8,200 207,460
------------
737,193
------------
RUSSIA -- 2.5%
Golden Telecom, Inc **...... 7,625 226,844
LUKoil Holdings -- ADR...... 5,800 296,496
Mobile Telesystems -- ADR... 6,000 134,250
------------
657,590
------------
UNITED KINGDOM -- 2.0%
Lasmo PLC................... 255,000 540,462
------------
FINLAND -- 1.8%
Hartwall Oyj ABP............ 23,450 472,057
------------
GREECE -- 1.3%
Folli -- Follie Abee........ 7,000 154,773
Hellenic Telecommunications
Organization SA -- ADR.... 16,700 203,531
------------
358,304
------------
ESTONIA -- 1.1%
Hansabank, Ltd.............. 39,440 298,367
------------
Total Europe................ 3,888,880
------------
SOUTH AMERICA -- 12.1%
BRAZIL -- 11.4%
Celular CRT Participacoes
SA -- A (Pref.)**......... 1,111,000 480,379
Companhia Paranaense de
Energia-Copel -- ADR...... 43,800 407,888
Empresa Brasileira de
Aeronautica SA (Pref.).... 90,000 519,360
Globo Cabo SA -- ADR........ 12,311 170,815
Petroleo Brasileiro SA
(Pref.) -- ADR............ 19,188 579,698
Tele Norte Leste
Participacoes SA -- ADR... 22,539 532,488
Telemig Celular
Participacoes SA -- ADR... 5,212 372,658
------------
3,063,286
------------
</TABLE>
<TABLE>
----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
CHILE -- 0.7%
Distribucion y Servicio D&S
SA -- ADR................. 11,500 $ 199,813
------------
Total South America......... 3,263,099
------------
NORTH AMERICA -- 11.3%
MEXICO -- 10.4%
Consorcio Ara SA de CV**.... 205,600 242,295
Corporacion Interamericana
de Entretenimiento SA --
B**....................... 80,500 320,587
Fomento Economico Mexicano
SA de CV -- ADR........... 9,150 394,022
Grupo Financiero Banorte SA
de CV -- O**.............. 236,200 331,149
Grupo Televisa SA --
GDR**..................... 7,840 540,470
Telefonos de Mexico SA --
ADR -- L.................. 8,770 500,986
Tubos de Acero de Mexico
SA -- ADR................. 19,900 276,113
TV Azteca SA de CV -- ADR... 15,300 201,769
------------
2,807,391
------------
UNITED STATES -- 0.9%
Electric Fuel Corp.**....... 15,200 232,750
------------
Total North America......... 3,040,141
------------
</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, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Number Market
of Value
Shares (Note A)
----------------------------------------------------------
<S> <C> <C>
MIDDLE EAST -- 4.9%
ISRAEL -- 4.9%
Check Point Software
Technologies, Ltd.**...... 766 $ 162,200
Clal Industries, Ltd........ 9,600 114,648
NUR Macroprinters, Ltd.**... 15,500 224,750
Orbotech, Ltd.**............ 3,249 301,751
Ormat Industries, Ltd.**.... 40,000 117,270
TTI Team Telecom
International, Ltd.**..... 11,200 403,200
------------
1,323,819
------------
Total Middle East........... 1,323,819
------------
AFRICA -- 3.0%
SOUTH AFRICA -- 3.0%
African Bank Investments,
Ltd.**.................... 61,370 80,200
Energy Africa, Ltd.**....... 88,000 201,187
M-Cell, Ltd................. 84,600 409,912
Prism Holdings, Ltd.**...... 127,000 111,457
------------
802,756
------------
Total Africa................ 802,756
------------
Total Equity Securities
(Cost $21,082,439)........ 22,953,223
------------
----------------------------------------------------------
EQUITY PARTICIPATION NOTES -- 2.8% (Note C)
----------------------------------------------------------
INDIA -- 2.8%
Aptech, Ltd. (Series B)**+.. 2,700 55,328
Himachal Futuristic
Communications, Ltd.
(Series A)**+............. 14,647 467,237
Satyam Computer Services,
Ltd. (Series C)**+........ 3,300 220,143
------------
742,708
------------
Total Equity Participation
Notes (Cost $694,323)..... 742,708
------------
</TABLE>
<TABLE>
----------------------------------------------------------
<CAPTION>
Number Market
of Value
Shares (Note A)
<S> <C> <C>
RIGHTS -- 0.0%
----------------------------------------------------------
THAILAND -- 0.0%
TelecomAsia Corporation
Public Co., Ltd.
(Foreign) -- Rights**..... 27,884 $ 0
------------
Total Rights (Cost $0)...... 0
------------
----------------------------------------------------------
TOTAL INVESTMENTS (COST
$21,776,762)................ 88.1% $ 23,695,931
Other Assets in Excess of
Liabilities................. 11.9% 3,191,241
---------- ------------
Net Assets...................... 100.0% $ 26,887,172
==========================================================
The federal income tax basis and unrealized appreciation
(depreciation) for all investments is as follows:
</TABLE>
<TABLE>
<S> <C>
Basis..................................... $ 21,776,762
============
Gross Appreciation........................ $ 2,605,261
Gross Depreciation........................ (686,092)
------------
Net Appreciation........................ $ 1,919,169
============
**Non-income producing security.
+Restricted security.
</TABLE>
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, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Advertising Agencies................... 0.8%
Aerospace.............................. 1.9%
Alternative Energy..................... 0.9%
Appliances............................. 0.8%
Banking................................ 4.2%
Beverages.............................. 3.2%
Broadcast & Publishing Services........ 6.6%
Building Materials..................... 1.0%
Business & Publishing Services......... 2.3%
Clothing............................... 1.0%
Communications......................... 0.8%
Computer Manufacturers................. 3.1%
Consumer Durables/Multi-Industry....... 0.5%
Consumer Services/Multi-Industry....... 0.9%
Data Processing........................ 0.2%
Electrical & Electronics............... 2.3%
Electrical Utilities................... 3.4%
Electronic Components.................. 5.6%
Energy Sources......................... 3.7%
Finance/Multi-Industry................. 2.7%
</TABLE>
<TABLE>
<CAPTION>
PERCENT OF
INDUSTRY NET ASSETS
-------- ----------
<S> <C>
Financial Services..................... 1.5%
Food & Household....................... 1.8%
Home Building.......................... 0.9%
Investments............................ 0.7%
Leisure & Tourism...................... 1.2%
Merchandising.......................... 0.6%
Oil.................................... 3.8%
Other Computers........................ 1.1%
Real Estate............................ 0.9%
Retailing -- Foods..................... 0.7%
Semiconductors/Components.............. 1.0%
Software & EDP Services................ 4.0%
Steel.................................. 1.0%
Technology/Multi-Industry.............. 1.5%
Telecommunications..................... 10.3%
Telephone Utilities.................... 6.5%
Textiles............................... 1.0%
Transportation -- Shipping............. 3.7%
Other Assets in Excess of
Liabilities.......................... 11.9%
------
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, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (Cost $21,776,762)......... $23,695,931
Foreign currency (Cost $943,293)........................ 942,723
Cash.................................................... 3,889,236
Receivables:
Dividends.......................................... 29,231
Interest........................................... 7,011
Investment securities sold......................... 875,450
Fund shares sold................................... 350,000
Prepaid expenses........................................ 9,900
Deferred organizational costs........................... 14,698
-----------
---------------------------------------------------------------------------
TOTAL ASSETS................................... 29,814,180
-----------
---------------------------------------------------------------------------
LIABILITIES:
Payables:
Investment securities purchased.................... 2,726,303
Fund shares redeemed............................... 91,205
Due to affiliates.................................. 26,328
Net unrealized depreciation on unsettled foreign
currency forward contracts from transaction
hedges............................................. 340
Foreign taxes...................................... 1,064
Accrued expenses........................................ 81,768
-----------
---------------------------------------------------------------------------
TOTAL LIABILITIES.............................. 2,927,008
-----------
---------------------------------------------------------------------------
NET ASSETS.................................................. $26,887,172
===========
SHARES OUTSTANDING.......................................... 1,465,400
===========
NET ASSET VALUE PER SHARE................................... $ 18.35
===========
===========================================================================
NET ASSETS CONSISTED OF THE FOLLOWING AT JUNE 30, 2000:
Paid-in capital......................................... $23,144,287
Undistributed net investment loss....................... (11,383)
Undistributed net realized gain......................... 1,905,538
Undistributed net realized foreign exchange loss........ (69,598)
Unrealized foreign exchange loss........................ (841)
Unrealized appreciation on investments.................. 1,919,169
-----------
NET ASSETS..................................... $26,887,172
===========
===========================================================================
</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, 2000 THROUGH JUNE 30, 2000
(UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT LOSS:
Income:
Dividends (net of non-reclaimable foreign taxes of
$4,222)............................................ $ 183,653
Interest........................................... 40,896
-----------
---------------------------------------------------------------------------
Total income..................................... 224,549
-----------
---------------------------------------------------------------------------
Expenses:
Investment advisory fee............................ 141,559
Administration fee................................. 57,000
Professional fees.................................. 20,083
Federal and state registration fees................ 13,495
Custodian fee...................................... 41,448
Transfer agent fees................................ 20,600
Trustees' fees..................................... 3,947
Amortization of organization costs................. 2,923
Miscellaneous...................................... 15,942
-----------
Total expenses before fees waived and
reimbursements..................................... 316,997
-----------
---------------------------------------------------------------------------
Administration fee waived.......................... (42,512)
Transfer agent fees waived......................... (6,000)
Expense reimbursement from advisor................. (32,553)
-----------
Total expenses net of fees waived and
reimbursements................................... 235,932
-----------
---------------------------------------------------------------------------
Net investment loss............................ (11,383)
-----------
---------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain from security transactions............ 996,543
Net realized foreign exchange loss...................... (69,598)
Net change in unrealized foreign exchange loss.......... (1,862)
Net change in unrealized appreciation of investments.... (2,022,905)
-----------
---------------------------------------------------------------------------
Net realized and unrealized loss on
investments.................................... (1,097,822)
-----------
---------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $(1,109,205)
===========
===========================================================================
</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 six month period
January 1, 2000
through For the year
June 30, 2000 ended
(unaudited) December 31, 1999
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment loss................................. $ (11,383) $ (80,321)
Net realized and unrealized gain (loss) on
investments....................................... (1,097,822) 5,716,937
----------- -----------
-------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations............................... (1,109,205) 5,636,616
----------- -----------
-------------------------------------------------------------------------------------------------------------------
Distributions to shareholders:
Net investment income............................... -- --
Capital gains....................................... -- (163,210)
----------- -----------
Total distributions to shareholders............. -- (163,210)
----------- -----------
-------------------------------------------------------------------------------------------------------------------
Capital share transactions:
Proceeds from shares sold........................... 23,303,752 2,064,333
Reinvestment of distributions....................... -- 163,210
Cost of shares redeemed............................. (5,844,389) (1,192,411)
----------- -----------
Net increase in net assets derived from capital
share transactions............................ 17,459,363 1,035,132
----------- -----------
Total increase in net assets.................... 16,350,158 6,508,538
----------- -----------
-------------------------------------------------------------------------------------------------------------------
NET ASSETS:
-------------------------------------------------------------------------------------------------------------------
Beginning of period..................................... $10,537,014 $ 4,028,476
----------- -----------
End of period........................................... $26,887,172 $10,537,014
=========== ===========
===================================================================================================================
Capital share transactions are as follows:
Shares issued....................................... 1,199,397 196,288
Shares reinvested................................... -- 10,709
Shares redeemed..................................... (307,823) (94,418)
----------- -----------
Net increase from capital share transactions.... 891,574 112,579
=========== ===========
===================================================================================================================
</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 six For the period
month period For the three from the
January 1, 2000 month period commencement
through For the year October 1, 1998 of operations
June 30, 2000 ended through December 31, 1997
(unaudited) December 31, 1999 December 31, 1998 through
---------------------------------------------------------------------------------------------- September 30, 1998
<S> <C> <C> <C> <C>
Net asset value, beginning of
period............................. $ 18.36 $ 8.73 $ 7.56 $ 10.00
------- ------- ------- -------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment loss................ (0.01) (0.14) (0.03) (0.03)
Net gains (losses) on investments
(both realized and unrealized)... -- 10.05 1.20 (2.41)
------- ------- ------- -------
Total income (loss) from
investment operations...... (0.01) 9.91 1.17 (2.44)
------- ------- ------- -------
LESS DISTRIBUTIONS:
Dividends from net investment
income........................... -- -- -- --
Distributions from capital gains... -- (0.28) -- --
------- ------- ------- -------
Total distributions.......... -- (0.28) -- --
------- ------- ------- -------
Net asset value, end of period....... $ 18.35 $ 18.36 $ 8.73 $ 7.56
======= ======= ======= =======
Total Return................. (0.05)%** 114.16% 15.48%** (24.40)%**
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in
000's)........................... $26,887 $10,537 $ 4,028 $ 3,487
Ratio of expenses to average net
assets........................... 2.50%*+ 2.58%+ 2.75%*+ 2.75%*+
Ratio of net investment loss to
average net assets............... (0.12)%*+ (1.29)%+ (1.23)%*+ (0.49)%*+
Portfolio turnover................. 170.78%** 366.53% 82.60%** 261.21%**
Annualized portfolio turnover...... 343.43% 366.53% 327.69% 349.24%
</TABLE>
--------------------------------------------------------------------------------
* Annualized
** Not Annualized
+ Such ratios are after administrative agent and transfer agent waivers and
Adviser expense reimbursements, when applicable. 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 forty-two 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 June 30, 2001 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
--------------------------------------------------------------------------------
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
The DRIEHAUS MUTUAL FUNDS (the "TRUST")is 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>
*DRIEHAUS INTERNATIONAL GROWTH FUND 10/28/96
DRIEHAUS INTERNATIONAL DISCOVERY FUND 12/31/98
DRIEHAUS EUROPEAN OPPORTUNITY FUND 12/31/98
DRIEHAUS ASIA PACIFIC GROWTH FUND 12/31/97
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.
------------------------------------
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 $1.5 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
The fiscal year end for the FUNDS 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, 2000, there
were no securities for which market quotations were not available, except for
equity participation notes (See Note C).
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.
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 and declared 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 amount of dividends and distributions from net investment income and net
realized capital gains are determined in accordance with Federal income tax
regulations, which may differ from generally accepted accounting principles.
52
<PAGE> 56
--------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
--------------------------------------------------------------------------------
To the extent these book and tax differences are permanent in nature, such
amounts are classified among paid-in-capital in excess of par value,
undistributed net investment income and undistributed net realized gain (loss)
on investments.
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' valuations.
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 foreign 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 portfolio hedges during the
six months ended June 30, 2000.
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, the
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>
DRIEHAUS INTERNATIONAL GROWTH FUND 15 Months
DRIEHAUS ASIA PACIFIC GROWTH FUND 30 Months
DRIEHAUS EMERGING MARKETS GROWTH FUND 30 Months
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
---------------------------------------------------------------------------------------------
</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 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%,
53
<PAGE> 57
--------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
--------------------------------------------------------------------------------
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 June 30, 2001.
------------------------------------
The expense caps and amounts accrued and payable to DCM during the six
months ended June 30, 2000 are as follows:
<TABLE>
<CAPTION>
Advisory Fees Expense Cap
Payable January 1, 1999 June 1, 1999
(included in due to to
Fund Advisory Fees to affiliates) May 31, 1999 June 30, 2000
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
DRIEHAUS INTERNATIONAL GROWTH FUND $3,400,466 $504,467 Not Applicable
DRIEHAUS INTERNATIONAL DISCOVERY FUND 403,646 76,802 2.50% 2.40%
DRIEHAUS EUROPEAN OPPORTUNITY FUND 421,423 73,067 2.10% 2.10%
DRIEHAUS ASIA PACIFIC GROWTH FUND 293,313 54,712 2.95% 2.50%
DRIEHAUS EMERGING MARKETS GROWTH FUND 141,559 26,328 2.75% 2.50%
------------------------------------------------------------------------------------------------------------------
</TABLE>
Driehaus Securities Corporation ("DSC") is the FUNDS' distributor.
DSC also acts as a broker for the FUNDS for domestically traded securities.
For the six months ended June 30, 2000, 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 $3,586,146 $192,169 6,149,239
DRIEHAUS INTERNATIONAL DISCOVERY FUND 608,552 32,823 1,009,695
DRIEHAUS EUROPEAN OPPORTUNITY FUND 628,223 3,798 330,054
DRIEHAUS ASIA PACIFIC GROWTH FUND 857,341 37,531 717,710
DRIEHAUS EMERGING MARKETS GROWTH FUND 253,351 39,640 808,956
-------------------------------------------------------------------------------------------------------------
</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., an indirect subsidiary of PNC Bank Corp., 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. Subsequent to the respective
FUNDS' initial twenty-four month periods of operations, PFPC Inc. has agreed to
phase-in their monthly minimum administrative fees for the FUNDS.
For the six months ended June 30, 2000, $19,326, $17,667, $29,624, and
$42,512 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, 2000, PFPC, Inc. waived $15,600 for the
DRIEHAUS INTERNATIONAL DISCOVERY FUND and the DRIEHAUS EUROPEAN OPPORTUNITY
54
<PAGE> 58
--------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
--------------------------------------------------------------------------------
FUND and $6,000 for the DRIEHAUS ASIA PACIFIC GROWTH FUND and the DRIEHAUS
EMERGING MARKETS GROWTH FUND. Subsequent to the respective FUNDS' initial two
years of operations, PFPC Inc. has agreed to phase-in that portion of its
monthly transfer agency fee which was previously waived.
------------------------------------
C. DERIVATIVES AND OTHER FINANCIAL
INSTRUMENTS
At June 30, 2000, the FUNDS had foreign currency forward contracts
outstanding under which they are obligated to exchange currencies at specified
future dates. At June 30, 2000, 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.
The FUNDS had the following outstanding contracts at June 30, 2000:
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, 2000
-----------------------------------------------------------------------------------
<C> <C> <S> <C> <C>
$ 914,366 957,295 Euro July 2000 $ 3,116
846,544 886,289 Euro July 2000 1,910
479,719 502,242 Euro July 2000 1,083
2,499,767 19,485,761 Hong Kong Dollar July 2000 183
234,383 1,827,025 Hong Kong Dollar July 2000 17
4,096,368 435,116,177 Japanese Yen July 2000 (49,570)
3,435,399 364,908,036 Japanese Yen July 2000 (52,206)
1,574,123 167,203,352 Japanese Yen July 2000 (23,921)
1,247,424 132,501,427 Japanese Yen July 2000 (18,956)
735,242 78,097,421 Japanese Yen July 2000 (8,897)
711,958 75,624,206 Japanese Yen July 2000 (8,615)
32,161 21,244 Pound Sterling July 2000 (106)
---------
$(155,962)
-----------------------------------------------------------------------------------
</TABLE>
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 2000
-----------------------------------------------------------------------------
<C> <C> <S> <C> <C>
$ 328,869 487,276 Canadian Dollar July 2000 $ (339)
168,912 250,272 Canadian Dollar July 2000 42
89,195 132,157 Canadian Dollar July 2000 (20)
1,101,395 1,152,830 Euro July 2000 (3,901)
846,347 885,871 Euro July 2000 (783)
485,583 508,381 Euro July 2000 (943)
297,877 311,788 Euro July 2000 (275)
52,864 55,346 Euro July 2000 (103)
---------
$ (6,322)
---------
Net unrealized depreciation $(162,284)
=========
-----------------------------------------------------------------------------
</TABLE>
55
<PAGE> 59
--------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
--------------------------------------------------------------------------------
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, 2000
--------------------------------------------------------------------------------
<C> <C> <S> <C> <C>
$140,117 233,365 Australian Dollar July 2000 $ (65)
188,436 197,283 Euro July 2000 366
135,567 14,399,910 Japanese Yen July 2000 (1,641)
131,282 13,944,770 Japanese Yen July 2000 (1,995)
425,666 692,163 Swiss Franc July 2000 2,066
-------
$(1,269)
--------------------------------------------------------------------------------
</TABLE>
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 2000
-----------------------------------------------------------------------------
<C> <C> <S> <C> <C>
$ 680 1,132 Australian Dollar July 2000 $ 0
29,753 487,568 Estonian Kroon July 2000 (95)
630,764 660,378 Euro July 2000 (1,225)
316,198 330,408 Euro July 2000 (824)
115,855 121,294 Euro July 2000 (225)
43,418 45,456 Euro July 2000 (98)
-------
$(2,467)
-------
Net unrealized depreciation $(3,736)
=======
-----------------------------------------------------------------------------
</TABLE>
DRIEHAUS EUROPEAN OPPORTUNITY FUND
Transaction Hedges:
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 2000
---------------------------------------------------------------------------
<C> <C> <S> <C> <C>
$408,660 427,847 Euro July 2000 $ (922)
332,736 348,358 Euro July 2000 (646)
289,799 303,405 Euro July 2000 (563)
221,121 231,503 Euro July 2000 (152)
-------
$(2,283)
-------
Net unrealized depreciation $(2,283)
=======
---------------------------------------------------------------------------
</TABLE>
56
<PAGE> 60
--------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
--------------------------------------------------------------------------------
DRIEHAUS ASIA PACIFIC GROWTH FUND
Transaction Hedges:
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 2000
-------------------------------------------------------------------------------
<C> <C> <S> <C> <C>
$382,119 40,588,660 Japanese Yen July 2000 $5,807
67,337 116,424 Singapore Dollar July 2000 (32)
------
$5,775
------
Net unrealized appreciation $5,775
======
-------------------------------------------------------------------------------
</TABLE>
DRIEHAUS EMERGING MARKETS GROWTH FUND
Transaction Hedges:
Foreign Currency Purchases:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Sold Foreign Currency Purchased Date at June 30, 2000
----------------------------------------------------------------------------
<C> <C> <S> <C> <C>
$117,737 480,709 Israel Shekel July 2000 $(228)
116,898 477,284 Israel Shekel July 2000 (227)
28,604 281,551 Mexican Pesos July 2000 (3)
50,640 1,986,296 Thailand Bahts July 2000 (108)
-----
$(566)
----------------------------------------------------------------------------
</TABLE>
Foreign Currency Sales:
<TABLE>
<CAPTION>
Unrealized
Appreciation
US Dollars Settlement (Depreciation)
Purchased Foreign Currency Sold Date at June 30, 2000
------------------------------------------------------------------------------
<C> <C> <S> <C> <C>
$75,777 514,949 South African Rand July 2000 $ 174
65,988 448,425 South African Rand July 2000 98
10,256 69,694 South African Rand July 2000 (46)
-----
$ 226
-----
Net unrealized depreciation $(340)
=====
------------------------------------------------------------------------------
</TABLE>
The FUNDS occasionally invest in equity participation notes which allow the
FUNDS to participate in the appreciation (depreciation) of the underlying
security without actually owning the underlying security. These instruments were
purchased pursuant to an agreement with a financial institution and are being
valued at a calculated market price based on the value of the underlying
security in accordance with the agreement. At June 30, 2000, the DRIEHAUS
INTERNATIONAL DISCOVERY FUND, the DRIEHAUS ASIA PACIFIC GROWTH FUND, and the
DRIEHAUS EMERGING MARKETS GROWTH FUND had unrealized appreciation of $173,255,
$37,994, and $48,385, respectively, as a result of their investment in these
financial instruments. The aggregate market values of these notes for the
DRIEHAUS INTERNATIONAL DISCOVERY FUND, the DRIEHAUS ASIA PACIFIC GROWTH FUND,
and the DRIEHAUS EMERGING MARKETS GROWTH FUND represented 1.3%, 6.0%, and 3.1%,
respectively, of their total market values at June 30, 2000.
57
<PAGE> 61
--------------------------------------------------------------------------------
DRIEHAUS MUTUAL FUNDS
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
--------------------------------------------------------------------------------
D. INVESTMENT TRANSACTIONS
The aggregate purchases and sales of investments securities, other than
short-term obligations, for the six months ended June 30, 2000, were as follows:
<TABLE>
<CAPTION>
Fund Purchases Sales
-----------------------------------------------------------------------------------------------
<S> <C> <C>
DRIEHAUS INTERNATIONAL GROWTH FUND $734,285,906 $737,315,434
DRIEHAUS INTERNATIONAL DISCOVERY FUND 122,373,538 82,199,817
DRIEHAUS EUROPEAN OPPORTUNITY FUND 143,154,358 106,740,696
DRIEHAUS ASIA PACIFIC GROWTH FUND 122,249,571 117,067,196
DRIEHAUS EMERGING MARKETS GROWTH FUND 43,206,660 28,505,461
-----------------------------------------------------------------------------------------------
</TABLE>
E. RESTRICTED SECURITIES
Restricted securities are securities that are not registered for sale under
the Securities Act of 1933 ("1933 Act") or applicable foreign law and that may
be re-sold only in transactions exempt from applicable registration. Restricted
securities include rule 144A securities which may be sold normally to qualified
institutional buyers. At June 30, 2000, the DRIEHAUS EMERGING MARKETS GROWTH
FUND held restricted securities, other than equity participation notes, whose
aggregate market value of $796,320 represented 3.4% of the total market value of
the fund. In addition, since an investment in equity participation notes (see
Note C) represents an agreement entered into with a financial institution, with
terms set by such financial institution, these instruments are also deemed to be
restricted.
F. LINES OF CREDIT
The FUNDS have a twenty-five million dollar committed line of credit. This
line of credit is available primarily to meet large, unexpected shareholder
withdrawals. The DRIEHAUS EUROPEAN OPPORTUNITY FUND and the DRIEHAUS ASIA
PACIFIC GROWTH FUND incurred $2,257 and $11,104, respectively, of interest
expense related to borrowings on the line of credit. At June 30, 2000, the FUNDS
had no outstanding borrowings.
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
