Phoenix Investment Partners
| Annual Report
|
| August 31, 2000
|
| -------------
|--- Duff & Phelps > Phoenix-Duff & Phelps
| ------------- Core Equity Fund
|
|--- Oakhurst > Phoenix-Oakhurst
Growth & Income
Fund
[LOGO] PHOENIX
INVESTMENT PARTNERS
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IFC (blank)
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Message from the President
Dear Shareholder:
[PHOTO OMITTED]
We are pleased to provide this annual report for the Phoenix-Duff & Phelps
Core Equity Fund and the Phoenix-Oakhurst Growth & Income Fund for the 12 months
ended August 31, 2000. On the following pages, your Fund's portfolio management
team reviews events in the equity markets that affected performance over the
last year and discusses investment strategy. We hope you find their comments
informative.
Historically, value stocks, which your funds invest in, have outperformed
growth stocks over very long periods of time, and both the Phoenix-Duff & Phelps
Core Equity Fund and the Phoenix-Oakhurst Growth & Income Fund recorded strong
returns for the last fiscal year. However, most value stocks underperformed
growth stocks, especially "dot.com" stocks over the past 12 months.
Since it is impossible to predict what investment style will be in favor
next quarter or next year, the need to be properly diversified has, perhaps,
never been more important. The goal of equity diversification is to capture the
overall returns of equities while moderating volatility, or wide swings in
performance results.
A diversified portfolio can offer protection in a volatile market by
spreading investment risk across a broad spectrum of investment styles and asset
classes. Less overlap or redundancy in a portfolio should translate into lower
volatility and greater opportunity to participate in the gains of whatever style
is currently in favor.
We recognize that it is important to measure results by investors' success
in reaching their personal financial goals within the context of their risk
tolerance and investment horizon. We believe that Phoenix-Duff & Phelps Core
Equity Fund and Phoenix-Oakhurst Growth & Income Fund offer investors a
complementary investment style that results in a well-diversified portfolio.
Your financial advisor can show you the benefits of asset allocation and help
you determine what types of investments best fit your financial plan.
If you have any questions, please call your financial advisor or contact
us at 1-800-243-4361 or www.phoenixinvestments.com. Information about your
account is available at our Web site or through our automated account
information line at 1-800-243-1574.
Sincerely,
/s/ Philip R. McLoughlin
Philip R. McLoughlin
August 31, 2000
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Mutual funds are not insured by the FDIC; are not deposits or other obligations
of a bank and are not guaranteed by a bank; and are subject to investment risks,
including possible loss of the principal invested.
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1
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
A Discussion with the Fund's Portfolio Manager, Diane Mustain
Q: What is the Fund's investment objective?
A: The Fund seeks long-term capital appreciation.
Q: How did the Fund perform over the last 12 months?
A: For the fiscal year ended August 31, 2000, Class A shares earned 8.70%, Class
B shares returned 7.99%, and Class C shares were up 7.90% for the 12 months.
While our high quality, relative value approach did not beat the broad S&P 500
Index,(1) which returned 16.39% for the year, results were in line with the S&P
500/Barra Value Index,(2) which gained only 9.32% for the period. All
performance figures assume reinvestment of distributions and exclude the effect
of sales charges.
Q: What market factors affected performance?
A: We believe that select investments in large-cap, high quality companies offer
the best opportunity to achieve above-market returns. Our high quality, relative
value investment discipline was not rewarded over the past year. We invest in
established companies in which we are confident of the predictability and
consistency of their future earnings and dividend growth. Thus, the market's
preference for richly valued technology stocks, often with no or very short
earnings history, negatively impacted the Fund's performance during this
reporting period.
Q: What were some of the portfolio's best performing stocks? What were some of
the more disappointing holdings?
A: Some of the Fund's best performing stocks included Providian Financial Corp.,
a provider of consumer loans, Sun Microsystems, a marketer of networked systems,
Guidant Corp., a manufacturer of cardiovascular equipment, Pfizer, a leading
research-based health-care company, and Duke Energy, which provides both
electric and natural gas energy services. Some of our disappointing holdings
were WorldCom, a global network services provider, and Georgia Pacific, a
manufacturer of building and paper products.
Q: What is your outlook for the next six months?
A: We are encouraged by the improving breadth of the market. While during 1999,
the market was dominated by soaring tech stocks, in the past three months, other
sectors of the market that had been neglected, such as utilities, energy and
financials, have been performing well. We feel that technology valuations peaked
in the first quarter of this year and are not likely to revisit their peak
levels. As a result, relative performance of the Fund to the S&P 500 Index has
improved as the market exhibited improved breadth. We believe that our focus on
high quality companies with consistent earnings growth will fare well over the
next six months, given our outlook for moderating economic growth in the U.S.
September 29, 2000
(1) The S&P 500 Index is an unmanaged, commonly used measure of broad stock
market total-return performance.
(2) The S&P 500/Barra Value Index is an unmanaged, commonly used measure of
value-oriented stock market total-return performance. The indices are not
available for direct investment.
2
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
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Average Annual Total Returns(1) PERIODS ENDING 8/31/00
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INCEPTION INCEPTION
1 Year TO 8/31/00 DATE
------ ---------- ---------
Class A Shares at NAV(2) 8.70% 10.99% 9/25/97
Class A Shares at POP(3) 2.45 8.77 9/25/97
Class B Shares at NAV(2) 7.99 10.19 9/25/97
Class B Shares with CDSC(4) 3.99 9.34 9/25/97
Class C Shares at NAV(2) 7.90 10.19 9/25/97
Class C Shares with CDSC(4) 7.90 10.19 9/25/97
S&P 500 Index(6) 16.39 19.20 9/25/97
(1) Total returns are historical and include changes in share price and the
reinvestment of both dividends and capital gains distributions.
(2) "NAV" (Net Asset Value) total returns do not include the effect of any
sales charge.
(3) "POP" (Public Offering Price) total returns include the effect of the
maximum front- end 5.75% sales charge.
(4) CDSC (contingent deferred sales charge) is applied to redemptions of
certain classes of shares that do not have a sales charge applied at the
time of purchase. CDSC charges for B shares decline from 5% to 0% over a
five year period. CDSC charges for C share are 1% in the first year and 0%
thereafter.
(5) This chart illustrates POP returns on Class A and CDSC returns for Class B
and Class C shares since inception.
(6) The S&P 500 Index is a measure of stock market total return performance.
The index's performance does not reflect sales charge.
All returns represent past performance which may not be indicative of
future performance. The investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
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Growth of $10,000 PERIODS END ING 8/31
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[GRAPH OMITTED]
This Growth of $10,000 chart assumes an initial investment of $10,000 made on
9/25/97 (inception of the Fund) in Class A, Class B, and Class C shares. The
total return for Class A shares reflects the maximum sales charge of 5.75% on
the initial investment. The total return for Class B shares reflects the CDSC
charges which decline from 5% to 0% over a five year period. The total return
for Class C shares reflects the CDSC charges which are 1% in the first year and
0% thereafter. Performance assumes dividends and capital gains are reinvested.
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Sector Weightings 8/31/00
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As a percentage of equity holdings
[The following table was depicted as a pie chart in the printed material.]
o Technology 31%
o Financials 15
o Health-Care 13
o Capital Goods 9
o Energy 8
o Consumer Cyclicals 6
o Utilities 6
o Other 12
3
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
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Ten Largest Holdings at August 31, 2000 (as a percentage of net assets)
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1. Providian Financial Corp. 3.7%
Provider of consumer loans and financial services
2. Intel Corp. 3.4%
Designs, develops and markets advanced
microcomputer components
3. Sun Microsystems, Inc. 3.4%
Marketer of networked systems
4. Conoco, Inc. Class A 3.2%
Involved in oil and gas exploration, development
and production
5. Motorola, Inc. 3.2%
Semiconductor and communications equipment provider
6. Tyco International Ltd. 3.0%
Diversified industrial services company
7. International Business Machines Corp. 2.9%
Provides advanced information technologies
8. MGIC Investment Corp. 2.8%
Private mortgage services provider
9. Computer Sciences Corp. 2.7%
Computer services provider
10. Exxon Mobil Corp. 2.7%
World's leading oil company
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INVESTMENTS AT AUGUST 31, 2000
SHARES VALUE
------ -----
COMMON STOCKS -- 97.3%
Auto Parts & Equipment -- 1.6%
Delphi Automotive Systems Corp. ................ 34,000 $ 558,875
Automobiles -- 0.9%
Ford Motor Co. ................................. 13,810 334,029
Banks (Major Regional) -- 1.9%
Wells Fargo & Co. .............................. 15,700 678,044
Banks (Money Center) -- 4.7%
Chase Manhattan Corp. (The) .................... 13,800 771,075
Firstar Corp. .................................. 37,600 897,700
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1,668,775
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Biotechnology -- 1.2%
Amgen, Inc.(b) ................................. 5,800 439,712
Chemicals -- 2.5%
Dow Chemical Co. (The) ......................... 13,800 361,387
Praxair, Inc. .................................. 11,850 524,362
----------
885,749
----------
Communications Equipment -- 3.2%
Motorola, Inc. ................................. 31,200 1,125,150
Computers (Hardware) -- 8.8%
Dell Computer Corp.(b) ......................... 20,700 903,037
International Business Machines Corp. .......... 7,750 1,023,000
Sun Microsystems, Inc.(b) ...................... 9,450 1,199,559
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3,125,596
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Computers (Networking) -- 2.4%
Cisco Systems, Inc.(b) ......................... 12,648 866,388
Computers (Peripherals) -- 2.5%
EMC Corp.(b) ................................... 9,100 891,800
Computers (Software & Services) -- 2.4%
Computer Associates International, Inc. ........ 11,300 358,775
Microsoft Corp.(b) ............................. 7,250 506,141
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864,916
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Consumer Finance-- 3.7%
Providian Financial Corp. ...................... 11,450 1,316,034
Electric Companies-- 3.6%
Duke Energy Corp. .............................. 6,500 486,281
Southern Co. (The) ............................. 27,000 808,312
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1,294,593
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Electrical Equipment-- 4.5%
General Electric Co. ........................... 13,150 771,741
Solectron Corp.(b) ............................. 18,050 817,891
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1,589,632
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See Notes to Financial Statements
4
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
SHARES VALUE
------ -----
Electronics (Semiconductors) -- 7.9%
Intel Corp. ........................................ 16,200 $ 1,212,975
Microchip Technology, Inc.(b) ...................... 9,800 667,012
Texas Instruments, Inc. ............................ 13,900 930,431
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2,810,418
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Financial (Diversified) -- 2.0%
Fannie Mae ......................................... 13,400 720,250
Health Care (Drugs-Major Pharmaceuticals) -- 6.6%
Lilly (Eli) & Co. .................................. 8,600 627,800
Pfizer, Inc. ....................................... 19,162 828,756
Schering-Plough Corp. .............................. 22,500 902,813
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2,359,369
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Health Care (Medical Products & Supplies) -- 4.8%
Baxter International, Inc. ......................... 5,550 462,038
Guidant Corp.(b) ................................... 8,850 595,716
Medtronic, Inc. .................................... 12,350 632,938
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1,690,692
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Household Products (Non-Durable) -- 1.9%
Kimberly-Clark Corp. ............................... 11,700 684,450
Insurance (Property-Casualty) -- 2.8%
MGIC Investment Corp. .............................. 17,100 1,005,694
Manufacturing (Diversified) -- 1.9%
United Technologies Corp. .......................... 10,650 664,959
Natural Gas -- 2.1%
Williams Cos., Inc. (The) .......................... 16,250 748,516
Oil & Gas (Exploration & Production) -- 1.1%
Unocal Corp. ....................................... 11,900 397,163
Oil & Gas (Refining & Marketing)-- 1.1%
Tosco Corp. ........................................ 12,200 372,100
Oil (Domestic Integrated) -- 3.2%
Conoco, Inc. Class A ............................... 45,400 1,143,513
Oil (International Integrated) -- 2.7%
Exxon Mobil Corp. .................................. 11,730 957,461
Paper & Forest Products -- 1.1%
Georgia-Pacific Group .............................. 15,100 403,925
Personal Care -- 1.0%
Estee Lauder Cos., Inc. (The) Class A .............. 8,650 354,109
Retail (Building Supplies) -- 0.9%
Home Depot, Inc. (The) ............................. 6,800 326,825
Retail (Drug Stores) -- 1.4%
CVS Corp. .......................................... 12,950 480,769
Retail (General Merchandise) -- 1.5%
Target Corp. ....................................... 22,600 525,450
Services (Advertising/Marketing) -- 1.3%
Omnicom Group, Inc. ................................ 5,450 454,734
Services (Computer Systems) -- 2.7%
Computer Sciences Corp.(b) ......................... 12,200 964,563
Services (Data Processing) -- 1.4%
First Data Corp. ................................... 10,600 505,488
Telecommunications (Long Distance) -- 2.1%
WorldCom, Inc.(b) .................................. 20,000 730,000
Telephone -- 1.9%
SBC Communications, Inc. ........................... 15,900 663,825
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Total Common Stocks
(Identified cost $28,317,674) ...................... 34,603,566
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See Notes to Financial Statements
5
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
SHARES VALUE
------ -----
FOREIGN COMMON STOCKS -- 3.0%
Manufacturing (Diversified) -- 3.0%
Tyco International Ltd. (Bermuda) ............... 18,400 $ 1,048,800
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Total Foreign Common Stocks
(Identified cost $793,784) 1,048,800
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Total Long-Term Investments -- 100.3%
(Identified cost $29,111,458) 35,652,366
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SHORT-TERM OBLIGATIONS -- 0.4%
Money Market Mutual Funds -- 0.4%
State Street Global Advisors
Seven Seas Money Market Fund
(6.29% seven day effective yield) 155,546 155,546
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Total Short-Term Obligations
(Identified cost $155,546) 155,546
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TOTAL INVESTMENTS -- 100.7%
(Identified cost $29,267,004) 35,807,912(a)
Cash and receivables, less liabilities -- (0.7%) (259,189)
------------
NET ASSETS -- 100.0% $ 35,548,723
============
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $7,768,120 and gross
depreciation of $1,324,286 for federal income tax purposes. At August 31,
2000, the aggregate cost of securities for federal income tax purposes was
$29,364,078.
(b) Non-income producing
See Notes to Financial Statements
6
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
STATEMENT OF ASSETS AND LIABILITIES
AUGUST 31, 2000
Assets
Investment securities at value
(Identified cost $29,267,004) $35,807,912
Receivables
Investment securities sold 288,516
Dividends and interest 49,682
Fund shares sold 6,574
Prepaid expenses 461
-----------
Total assets 36,153,145
-----------
Liabilities
Payables
Investment securities purchased 376,265
Fund shares repurchased 152,043
Investment advisory fee 3,850
Distribution fee 12,266
Transfer agent fee 10,505
Trustees' fee 8,342
Financial agent fee 5,756
Accrued expenses 35,395
-----------
Total liabilities 604,422
-----------
Net Assets $35,548,723
===========
Net Assets Consist of:
Capital paid in on shares of beneficial interest $28,150,919
Accumulated net realized gain 856,896
Net unrealized appreciation 6,540,908
-----------
Net Assets $35,548,723
===========
Class A
Shares of beneficial interest outstanding, $1 par value
unlimited authorization (Net Assets $27,840,457) 2,121,229
Net asset value per share $13.12
Offering price per share $13.12/(1-5.75%) $13.92
Class B
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization (Net Assets $6,113,446) 475,883
Net asset value and offering price per share $12.85
Class C
Shares of beneficial interest outstanding, $1 par value
unlimited authorization (Net Assets $1,594,820) 124,116
Net asset value and offering price per share $12.85
STATEMENT OF OPERATIONS
YEAR ENDED AUGUST 31, 2000
Investment Income
Dividends $ 394,454
Interest 26,700
-----------
Total investment income 421,154
-----------
Expenses
Investment advisory fee 297,630
Distribution fee, Class A 75,300
Distribution fee, Class B 75,301
Distribution fee, Class C 20,340
Financial agent fee 73,229
Transfer agent 73,060
Registration 26,361
Professional 25,449
Trustees 20,494
Custodian 11,539
Printing 8,902
Miscellaneous 9,675
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Total expenses 717,280
Less expenses borne by investment adviser (149,507)
-----------
Net expenses 567,773
-----------
Net investment loss (146,619)
-----------
Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain on securities 1,040,007
Net change in unrealized appreciation (depreciation) on
investments 2,177,857
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Net gain on investments 3,217,864
-----------
Net increase in net assets resulting from operations $ 3,071,245
===========
See Notes to Financial Statements
7
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
8/31/00 8/31/99
------------ ------------
<S> <C> <C>
From Operations
Net investment income (loss) $ (146,619) $ (58,694)
Net realized gain (loss) 1,040,007 944,586
Net change in unrealized appreciation (depreciation) 2,177,857 8,988,251
------------ ------------
Increase (decrease) in net assets resulting from operations 3,071,245 9,874,143
------------ ------------
From Distributions to Shareholders
Net realized gains, Class A (749,938) (261,214)
Net realized gains, Class B (223,144) (57,305)
Net realized gains, Class C (57,248) (20,502)
------------ ------------
Decrease in net assets from distributions to shareholders (1,030,330) (339,021)
------------ ------------
From Share Transactions
Class A
Proceeds from sales of shares (341,078 and 1,335,911 shares, respectively) 4,198,264 15,137,826
Net asset value of shares issued from reinvestment of distributions
(58,266 and 21,036 shares, respectively) 735,321 253,063
Cost of shares repurchased (1,614,716 and 318,410 shares, respectively) (20,021,141) (3,902,092)
------------ ------------
Total (15,087,556) 11,488,797
------------ ------------
Class B
Proceeds from sales of shares (44,678 and 163,890 shares, respectively) 548,634 1,900,577
Net asset value of shares issued from reinvestment of distributions
(16,418 and 1,664 shares, respectively) 203,748 19,857
Cost of shares repurchased (349,908 and 94,004 shares, respectively) (4,269,830) (1,146,586)
------------ ------------
Total (3,517,448) 773,848
------------ ------------
Class C
Proceeds from sales of shares (15,900 and 54,557 shares, respectively) 193,158 630,490
Net asset value of shares issued from reinvestment of distributions
(4,208 and 317 shares, respectively) 52,259 3,792
Cost of shares repurchased (100,007 and 106,979 shares, respectively) (1,228,414) (1,323,676)
------------ ------------
Total (982,997) (689,394)
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Class M
Cost of shares repurchased (0 and 10,032 shares, respectively) -- (109,546)
------------ ------------
Total -- (109,546)
------------ ------------
Increase (decrease) in net assets from share transactions (19,588,001) 11,463,705
------------ ------------
Net increase (decrease) in net assets (17,547,086) 20,998,827
Net Assets
Beginning of period 53,095,809 32,096,982
------------ ------------
End of period [including undistributed net investment
income of $0 and $0, respectively] $ 35,548,723 $ 53,095,809
============ ============
</TABLE>
See Notes to Financial Statements
8
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
<TABLE>
<CAPTION>
CLASS A
----------------------------------------------
From
Year Ended August 31 Inception
---------------------------- 9/25/97 to
2000 1999 8/31/98
<S> <C> <C> <C>
Net asset value, beginning of period $ 12.37 $ 9.87 $ 10.00
Income from investment operations
Net investment income (loss)(1) (0.02) 0.01 --
Net realized and unrealized gain (loss) 1.08 2.57 (0.09)
------- ------- -------
Total from investment operations 1.06 2.58 (0.09)
------- ------- -------
Less distributions
Dividends from net realized gains (0.31) (0.08) --
In excess of net investment income -- -- (0.04)
------- ------- -------
Total distributions (0.31) (0.08) (0.04)
------- ------- -------
Change in net asset value 0.75 2.50 (0.13)
------- ------- -------
Net asset value, end of period $ 13.12 $ 12.37 $ 9.87
======= ======= =======
Total return(2) 8.70% 26.12% (0.93)%(5)
Ratios/supplemental data:
Net assets, end of period (thousands) $27,840 $41,272 $22,683
Ratio to average net assets of:
Operating expenses(3) 1.25% 1.25% 1.25%(6)
Net investment income (loss) (0.19)% 0.06% 0.02%(6)
Portfolio turnover 81% 82% 83%(5)
</TABLE>
<TABLE>
<CAPTION>
CLASS B
----------------------------------------------
From
Year Ended August 31 Inception
---------------------------- 9/25/97 to
2000 1999 8/31/98
<S> <C> <C> <C>
Net asset value, beginning of period $12.20 $ 9.81 $10.00
Income from investment operations
Net investment income (loss)(1) (0.12) (0.08) (0.08)
Net realized and unrealized gain (loss) 1.08 2.55 (0.08)
------ ------- ------
Total from investment operations 0.96 2.47 (0.16)
------ ------- ------
Less distributions
Dividends from net realized gains (0.31) (0.08) --
In excess of net investment income -- -- (0.03)
------ ------- ------
Total distributions (0.31) (0.08) (0.03)
------ ------- ------
Change in net asset value 0.65 2.39 (0.19)
------ ------- ------
Net asset value, end of period $12.85 $ 12.20 $ 9.81
====== ======= ======
Total return(2) 7.99% 25.16% (1.61)%(5)
Ratios/supplemental data:
Net assets, end of period (thousands) $6,113 $ 9,333 $6,801
Ratio to average net assets of:
Operating expenses(4) 2.00% 2.00% 2.00%(6)
Net investment income (loss) (0.93)% (0.69)% 0.73%(6)
Portfolio turnover 81% 82% 83%(5)
</TABLE>
(1) Computed using average shares outstanding.
(2) Maximum sales charges are not reflected in the total return calculation.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.64%,
1.43% and 2.95% for the periods ended August 31, 2000, 1999 and 1998,
respectively.
(4) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.39%,
2.18% and 3.70% for the periods ended August 31, 2000, 1999 and 1998,
respectively.
(5) Not annualized.
(6) Annualized.
See Notes to Financial Statements
9
<PAGE>
Phoenix-Duff & Phelps Core Equity Fund
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
<TABLE>
<CAPTION>
CLASS C
----------------------------------------------
From
Year Ended August 31 Inception
---------------------------- 9/25/97 to
2000 1999 8/31/98
<S> <C> <C> <C>
Net asset value, beginning of period $12.21 $ 9.82 $10.00
Income from investment operations
Net investment income (loss)(1) (0.12) (0.08) (0.08)
Net realized and unrealized gain (loss) 1.07 2.55 (0.07)
------ ------ ------
Total from investment operations 0.95 2.47 (0.15)
------ ------ ------
Less distributions
Dividends from net realized gains (0.31) (0.08) --
In excess of net investment income -- -- (0.03)
------ ------ ------
Total distributions (0.31) (0.08) (0.03)
------ ------ ------
Change in net asset value 0.64 2.39 (0.18)
------ ------ ------
Net asset value, end of period $12.85 $12.21 $ 9.82
====== ====== ======
Total return(2) 7.90% 25.13% (1.52)%(4)
Ratios/supplemental data:
Net assets, end of period (thousands) $1,595 $2,491 $2,514
Ratio to average net assets of:
Operating expenses(3) 2.00% 2.00% 2.00%(5)
Net investment income (loss) (0.93)% (0.70)% (0.73)%(5)
Portfolio turnover 81% 82% 83%(4)
</TABLE>
(1) Computed using average shares outstanding.
(2) Maximum sales charges are not reflected in the total return calculation.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.39%,
2.18% and 3.70% for the periods ended August 31, 2000, 1999 and 1998,
respectively.
(4) Not annualized.
(5) Annualized.
See Notes to Financial Statements
10
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
A Discussion with the Fund's Portfolio Management Team, Steve Colton and Dong
Zhang
Q: What is the Fund's investment objective?
A: The Fund seeks dividend growth, current income and capital appreciation.
Q: How did the Fund perform over the last 12 months?
A: For the fiscal year ended August 31, 2000, Class A shares earned 16.83%,
beating the 16.39% return for the S&P 500 Index,(1) and the average 9.66% return
for a peer universe of large-capitalization value funds, according to Lipper,
Inc. Class B shares returned 15.99%, and Class C shares were up 16.06% for the
12 months. All performance figures assume reinvestment of distributions and
exclude the effect of sales charges.
Q: How would you characterize the market environment over this reporting period?
A: This was another good year for stock investors, although not as spectacular
as the year before. Robust consumer spending, business investment in new
technologies and a strong housing market drove rapid economic growth. There was
record low unemployment, low inflation and high productivity growth. The economy
was so strong that it influenced the Federal Reserve's policy-setting Federal
Open Market Committee to raise interest rates six times, beginning in June of
1999. The Y2K computer issue turned out to be one of the biggest non-events in
history. Some extremists had predicted a Y2K-induced recession, which proved to
be far from the truth.
In contrast to the previous fiscal year, small-capitalization stocks beat
large-caps. The small-cap Russell 2000 Index(2) rose 27.16%, while the large-cap
S&P 500 rose 16.39%. Growth stocks again dominated value-type companies. The S&P
500/Barra Growth Index(3) rose 22.05%, topping the 9.32% return on the S&P
500/Barra Value Index.(4)
The technology-dominated Nasdaq Index(5) rose a stellar 53.55%. Recently,
however, tech stocks have fallen out of favor. There is worry that telephone
companies, with their weakening sales growth and depressed stock prices, will
cut back on purchases of telecommunications and networking equipment.
Q: How did these market factors affect performance?
A: Successful sector allocation was the primary driver of our return in excess
of the S&P 500 and our Lipper peer group. The portfolio had a higher percentage
of its assets in the top-performing three sectors of the market versus our S&P
500 benchmark. The highest-returning sectors were utilities, health care and
financial services.
(1) The S&P 500 Index is an unmanaged, commonly used benchmark of broad stock
market total-return performance.
(2) The Russell 2000 Index is an unmanaged, commonly used benchmark of
small-capitalization total-return performance.
(3) The S&P 500/Barra Growth Index is an unmanaged, commonly used benchmark of
large-cap, growth stock market total-return performance.
(4) The S&P 500/Barra Value Index is an unmanaged, commonly used benchmark of
large-cap, value stock market total-return performance.
(5) The Nasdaq Index is an unmanaged, commonly used benchmark of
technology-oriented stock market total-return performance.
The indices are not available for direct investment.
11
<PAGE>
Phoenix-Oakhurst Growth & Income Fund (continued)
A shortage of generating capacity and hot summer weather helped utility
stocks involved in power generation. Two standout companies in the portfolio
over this time period were Duke Energy and Reliant Energy. In the health-care
sector, managed-care companies benefited from improved product pricing. Trigon
Healthcare and Oxford Healthcare were two of our strongest performers. Financial
services stocks rallied on a wave of merger activity, as size and scale were
seen to be critical factors to long-term survival in this group. Among the
Fund's holdings, Lehman Brothers and Merrill Lynch gained on solid earnings
reports and as both companies were viewed as takeover candidates.
Takeover activity was another factor in the portfolio's strong
performance. Other companies acquired several stocks in the portfolio at premium
prices. The list of takeovers included: Champion International, Times Mirror,
International Home Foods, Mallinckrodt, Chris-Craft Industries, GPU and
Donaldson, Lufkin & Jenrette.
Microsoft was a negative factor on the Fund's performance. The company's
stock price was hurt by the government lawsuit in addition to delays to the
release of the Windows 2000 operating system. Some analysts believe Microsoft
has lost its dominance as wireless handheld devices and Internet-based computing
platforms become more prevalent.
Q: What is your current market outlook?
A: We expect economic growth to continue to accelerate over the next year,
although at a slower rate than in the year 2000. Consensus forecasts are for
3.1% real GDP growth in calendar 2001. S&P 500 profits are expected to grow as
well. Currently, the prevailing earnings estimates are for slightly over 8%
growth for S&P 500 profits next year.
There are several issues that may drive expectations about economic and
corporate profit growth lower as time progresses. Soaring oil prices, higher
interest rates and slowing consumer spending are likely to have an adverse
impact on everything from auto to appliance and jewelry sales. Multi-national
companies operating in Europe could see profits reduced by the weaker euro
currency as those sales are translated back into fewer dollars.
Most equity strategists believe the Fed is done, or nearly complete, with
this cycle of interest rate increases. If true, this would be positive for
stocks. The presidential election is also a factor for investors. Depending on
who is elected president, certain sectors of the stock market could experience
significant volatility (e.g., pharmaceuticals and tobacco). With all these
crosscurrents, it is a good time for a well-diversified portfolio.
September 14, 2000
12
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
--------------------------------------------------------------------------------
Average Annual Total Returns(1) PERIODS ENDING 8/31/00
--------------------------------------------------------------------------------
INCEPTION INCEPTION
1 Year TO 8/31/00 DATE
------ ---------- ---------
Class A Shares at NAV(2) 16.83% 20.58% 9/25/97
Class A Shares at POP(3) 10.11 18.17 9/25/97
Class B Shares at NAV(2) 15.99 19.68 9/25/97
Class B Shares with CDSC(4) 11.99 18.95 9/25/97
Class C Shares at NAV(2) 16.06 19.70 9/25/97
Class C Shares with CDSC(4) 16.06 19.70 9/25/97
S&P 500 Index(6) 16.39 19.20 9/25/97
(1) Total returns are historical and include changes in share price and the
reinvestment of both dividends and capital gains distributions.
(2) "NAV" (Net Asset Value) total returns do not include the effect of any
sales charge.
(3) "POP" (Public Offering Price) total returns include the effect of the
maximum front-end 5.75% sales charge.
(4) CDSC (contingent deferred sales charge) is applied to redemptions of
certain classes of shares that do not have a sales charge applied at the
time of purchase. CDSC charges for B shares decline from 5% to 0% over a
five year period. CDSC charges for C share are 1% in the first year and 0%
thereafter.
(5) This chart illustrates POP returns on Class A and CDSC returns for Class B
and Class C shares since inception.
(6) The S&P 500 Index is a measure of stock market total return performance.
The index's performance does not reflect sales charge.
All returns represent past performance which may not be indicative of
future performance. The investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
--------------------------------------------------------------------------------
Growth of $10,000 PERIODS ENDING 8/31
--------------------------------------------------------------------------------
[GRAPH OMITTED]
This Growth of $10,000 chart assumes an initial investment of $10,000 made on
9/25/97 (inception of the Fund) in Class A, Class B, and Class C shares. The
total return for Class A shares reflects the maximum sales charge of 5.75% on
the initial investment. The total return for Class B shares reflects the CDSC
charges which decline from 5% to 0% over a five year period. The total return
for Class C shares reflects the CDSC charges which are 1% in the first year and
0% thereafter. Performance assumes dividends and capital gains are reinvested.
--------------------------------------------------------------------------------
Sector Weightings 8/31/00
--------------------------------------------------------------------------------
As a percentage of equity holdings
[The following table was depicted as pie chart in the printed material.]
o Technology 30%
o Financials 18
o Health-Care 10
o Capital Goods 9
o Consumer Staples 7
o Consumer Cyclicals 7
o Energy 6
o Other 13
13
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
--------------------------------------------------------------------------------
Ten Largest Holdings at August 31, 2000 (as a percentage of net assets)
--------------------------------------------------------------------------------
1. General Electric Co. 4.2%
Diversified manufacturing and financial provider
2. Intel Corp. 3.4%
Designs, develops and markets advanced
microcomputer components
3. Citigroup, Inc. 3.2%
Diversified financial services holding company
4. Cisco Systems, Inc. 3.1%
Manufactures computer network products
5. S&P 500 Depository Receipts 2.9%
Long-term Unit Investment Trust
6. Microsoft Corp. 2.4%
World's leading computer software company
7. Exxon Mobil Corp. 2.1%
World's leading oil company
8. Pfizer, Inc. 2.0%
Health-care products and specialty chemicals producer
9. Morgan Stanley Dean Witter & Co. 1.9%
Financial services provider
10. International Business Machines Corp. 1.9%
Provides advanced information technologies
--------------------------------------------------------------------------------
INVESTMENTS AT AUGUST 31, 2000
SHARES VALUE
------ -----
COMMON STOCKS -- 92.6%
Aerospace/Defense -- 1.7%
Boeing Co. (The) ................................. 84,900 $ 4,552,762
General Dynamics Corp. ........................... 43,800 2,756,662
Northrop Grumman Corp. ........................... 25,200 1,960,875
-----------
9,270,299
-----------
Agricultural Products -- 0.0%
Archer-Daniels-Midland Co. ....................... 4,895 43,137
Airlines -- 0.3%
AMR Corp.(b) ..................................... 17,100 561,094
Delta Air Lines, Inc. ............................ 20,900 1,034,550
-----------
1,595,644
-----------
Aluminum -- 0.7%
Alcoa, Inc. ...................................... 114,200 3,797,150
Auto Parts & Equipment -- 0.2%
TRW, Inc. ........................................ 19,700 900,044
Automobiles -- 1.5%
Ford Motor Co. ................................... 275,862 6,672,412
General Motors Corp. ............................. 21,300 1,537,594
-----------
8,210,006
-----------
Banks (Major Regional) -- 1.5%
FleetBoston Financial Corp. ...................... 145,700 6,219,569
Wells Fargo & Co. ................................ 46,400 2,003,900
-----------
8,223,469
-----------
Banks (Money Center) -- 2.9%
Bank of America Corp. ............................ 59,900 3,208,394
Chase Manhattan Corp. (The) ...................... 127,000 7,096,125
Morgan (J.P.) & Co., Inc. ........................ 33,800 5,650,937
-----------
15,955,456
-----------
Banks (Regional) -- 0.6%
Cullen/Frost Bankers, Inc. ....................... 30,000 930,000
Silicon Valley Bancshares(b) ..................... 36,800 2,120,600
-----------
3,050,600
-----------
Beverages (Alcoholic) -- 0.1%
Coors (Adolph) Co. Class B ....................... 9,500 565,844
Biotechnology -- 0.3%
Amgen, Inc.(b) ................................... 25,000 1,895,312
Broadcasting (Television, Radio & Cable) -- 0.4%
AT&T Corp.- Liberty Media Corp. Class A(b) ....... 59,300 1,267,537
Clear Channel Communications, Inc.(b) ............ 15,600 1,129,050
-----------
2,396,587
-----------
Chemicals -- 1.1%
Air Products & Chemicals, Inc. ................... 14,500 526,531
Dow Chemical Co. (The) ........................... 75,600 1,979,775
Du Pont (E.I.) de Nemours & Co. .................. 74,300 3,334,212
-----------
5,840,518
-----------
See Notes to Financial Statements
14
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
SHARES VALUE
------ -----
Communications Equipment -- 3.5%
ADC Telecommunications, Inc.(b) .............. 46,200 $ 1,891,312
Comverse Technology, Inc.(b) ................. 19,300 1,774,394
Corning, Inc. ................................ 5,600 1,836,450
JDS Uniphase Corp.(b) ........................ 15,200 1,894,300
Lucent Technologies, Inc. .................... 88,900 3,717,131
Motorola, Inc. ............................... 113,000 4,075,062
QUALCOMM, Inc.(b) ............................ 28,100 1,682,487
Sawtek, Inc.(b) .............................. 11,300 569,944
Scientific-Atlanta, Inc. ..................... 14,600 1,137,887
Tellabs, Inc.(b) ............................. 9,200 516,925
-----------
19,095,892
-----------
Computers (Hardware)-- 6.1%
Apple Computer, Inc.(b) ...................... 46,600 2,839,687
Compaq Computer Corp. ........................ 89,400 3,045,187
Dell Computer Corp.(b) ....................... 107,800 4,702,775
Gateway, Inc.(b) ............................. 12,900 878,490
Hewlett-Packard Co. .......................... 40,300 4,866,225
International Business Machines Corp. ........ 78,800 10,401,600
Sun Microsystems, Inc.(b) .................... 54,500 6,918,094
-----------
33,652,058
-----------
Computers (Networking) -- 3.1%
Cisco Systems, Inc.(b) ....................... 248,500 17,022,250
Computers (Peripherals) -- 0.8%
EMC Corp.(b) ................................. 47,400 4,645,200
Computers (Software & Services) -- 6.4%
Adobe Systems, Inc. .......................... 15,500 2,015,000
America Online, Inc.(b) ...................... 84,500 4,953,812
Microsoft Corp.(b) ........................... 191,000 13,334,187
Oracle Corp.(b) .............................. 111,100 10,103,156
VERITAS Software Corp.(b) .................... 13,800 1,663,762
Verity, Inc.(b) .............................. 11,700 535,275
Yahoo!, Inc.(b) .............................. 20,800 2,527,200
-----------
35,132,392
-----------
Consumer Finance -- 0.5%
MBNA Corp. ................................... 30,300 1,069,969
PMI Group, Inc. (The) ........................ 12,400 768,800
Providian Financial Corp. .................... 7,200 827,550
-----------
2,666,319
-----------
Distributors (Food & Health) -- 0.9%
AmeriSource Health Corp. Class A(b) .......... 23,300 809,675
Andrx Corp.(b) ............................... 6,200 539,400
Cardinal Health, Inc. ........................ 18,400 1,505,350
SYSCO Corp. .................................. 43,200 1,827,900
-----------
4,682,325
-----------
Electric Companies -- 3.4%
DTE Energy Co. ............................... 28,700 997,325
Duke Energy Corp. ............................ 29,600 2,214,450
Energy East Corp. ............................ 105,200 2,386,725
Entergy Corp. ................................ 59,900 1,823,206
GPU, Inc. .................................... 56,300 1,724,187
Minnesota Power, Inc. ........................ 33,400 741,062
PECO Energy Co. .............................. 19,900 958,931
PG&E Corp. ................................... 15,800 457,212
Public Service Enterprise Group, Inc. ........ 10,400 377,000
Reliant Energy, Inc. ......................... 100,000 3,712,500
Unicom Corp. ................................. 16,800 767,550
UtiliCorp United, Inc. ....................... 104,800 2,495,550
-----------
18,655,698
-----------
Electrical Equipment -- 4.8%
AVX Corp. .................................... 36,100 1,080,744
General Electric Co. ......................... 393,300 23,081,794
KEMET Corp.(b) ............................... 36,700 1,101,000
Vishay Intertechnology, Inc.(b) .............. 30,300 1,221,469
-----------
26,485,007
-----------
Electronics (Instrumentation) -- 0.6%
Credence Systems Corp.(b) .................... 20,300 1,188,819
Trimble Navigation Ltd.(b) ................... 54,000 2,244,375
-----------
3,433,194
-----------
Electronics (Semiconductors) -- 5.4%
Advanced Micro Devices, Inc.(b) .............. 20,400 767,550
Analog Devices, Inc.(b) ...................... 11,000 1,105,500
Cypress Semiconductor Corp.(b) ............... 22,100 1,092,569
Integrated Device Technology, Inc.(b) ........ 24,700 2,167,425
Intel Corp. .................................. 247,000 18,494,125
National Semiconductor Corp.(b) .............. 35,800 1,593,100
Texas Instruments, Inc. ...................... 69,200 4,632,075
-----------
29,852,344
-----------
Entertainment -- 1.2%
Time Warner, Inc. ............................ 42,900 3,667,950
Viacom, Inc. Class B(b) ..................... 41,422 2,788,218
-----------
6,456,168
-----------
Equipment (Semiconductors) -- 1.4%
Applied Materials, Inc.(b) ................... 41,800 3,607,862
Cymer, Inc.(b) ............................... 11,900 546,656
KLA-Tencor Corp.(b) .......................... 9,600 630,000
Lam Research Corp.(b) ........................ 35,100 1,057,387
Teradyne, Inc.(b) ............................ 28,000 1,814,750
-----------
7,656,655
-----------
See Notes to Financial Statements
15
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
SHARES VALUE
------ -----
Financial (Diversified) -- 6.3%
Ambac Financial Group, Inc. ...................... 19,000 $ 1,227,875
American Express Co. ............................. 53,000 3,133,625
Citigroup, Inc. .................................. 304,533 17,777,133
Fannie Mae ....................................... 38,000 2,042,500
Morgan Stanley Dean Witter & Co. ................. 98,800 10,627,175
-----------
34,808,308
-----------
Foods -- 1.7%
ConAgra, Inc. .................................... 72,000 1,318,500
Kellogg Co. ...................................... 26,000 602,875
McCormick & Co., Inc. ............................ 25,100 732,606
PepsiCo, Inc. .................................... 98,600 4,202,825
Quaker Oats Co. (The) ............................ 37,300 2,534,069
-----------
9,390,875
-----------
Health Care (Diversified) -- 2.6%
Abbott Laboratories .............................. 61,500 2,690,625
Allergan, Inc. ................................... 11,500 840,937
Bristol-Myers Squibb Co. ......................... 91,600 4,854,800
Johnson & Johnson ................................ 65,900 6,058,681
-----------
14,445,043
-----------
Health Care (Drugs-Major Pharmaceuticals) -- 4.7%
Lilly (Eli) & Co. ................................ 44,100 3,219,300
Merck & Co., Inc. ................................ 93,200 6,512,350
Pfizer, Inc. ..................................... 250,800 10,847,100
Pharmacia Corp. .................................. 37,128 2,174,309
Schering-Plough Corp. ............................ 78,100 3,133,763
-----------
25,886,822
-----------
Health Care (Generic and Other) -- 0.4%
Jones Pharma, Inc. ............................... 56,800 2,030,600
Health Care (Hospital Management) -- 0.2%
Tenet Healthcare Corp(b) ......................... 34,900 1,081,900
Health Care (Managed Care) -- 1.5%
Oxford Health Plans, Inc.(b) ..................... 70,400 2,147,200
PacifiCare Health Systems, Inc.(b) ............... 13,300 717,369
UnitedHealth Group, Inc. ......................... 35,800 3,383,100
Wellpoint Health Networks, Inc.(b) ............... 19,700 1,700,356
-----------
7,948,025
-----------
Household Products (Non-Durable) -- 0.6%
Kimberly-Clark Corp. ............................. 55,400 3,240,900
Housewares -- 0.2%
Tupperware Corp. ................................. 66,300 1,338,431
Insurance (Life/Health) -- 0.6%
Lincoln National Corp. ........................... 62,900 3,396,600
Insurance (Multi-Line) -- 0.7%
CIGNA Corp. ...................................... 27,200 2,645,200
Loews Corp. ...................................... 16,000 1,295,000
-----------
3,940,200
-----------
Insurance (Property-Casualty) -- 0.3%
MGIC Investment Corp. ............................ 12,000 705,750
Radian Group, Inc. ............................... 18,600 1,155,525
-----------
1,861,275
-----------
Insurance Brokers -- 0.3%
Gallagher (Arthur J.) & Co. ...................... 31,000 1,519,000
Investment Banking/Brokerage -- 1.6%
AXA Financial, Inc. .............................. 25,000 1,293,750
Donaldson, Lufkin & Jenrette, Inc. ............... 8,800 778,800
Lehman Brothers Holdings, Inc. ................... 17,500 2,537,500
Merrill Lynch & Co., Inc. ........................ 28,000 4,060,000
-----------
8,670,050
-----------
Investment Management -- 0.1%
Franklin Resources, Inc. ......................... 10,200 387,600
Iron & Steel -- 0.2%
Nucor Corp. ...................................... 27,700 1,017,975
Machinery (Diversified) -- 0.5%
Dover Corp. ...................................... 59,000 2,883,625
Manufacturing (Diversified) -- 1.3%
Minnesota Mining and Manufacturing Co. ........... 35,200 3,273,600
Parker-Hannifin Corp. ............................ 27,600 960,825
United Technologies Corp. ........................ 41,800 2,609,888
-----------
6,844,313
-----------
Manufacturing (Specialized) -- 0.1%
Cognex Corp.(b) .................................. 12,100 484,000
Natural Gas -- 0.8%
Equitable Resources, Inc. ........................ 34,300 1,931,519
Sempra Energy .................................... 126,700 2,470,650
-----------
4,402,169
-----------
See Notes to Financial Statements
16
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
SHARES VALUE
------ -----
Oil & Gas (Exploration & Production) -- 1.4%
Apache Corp. ..................................... 49,300 $ 3,105,900
Kerr-McGee Corp. ................................. 33,400 2,110,463
Unocal Corp. ..................................... 65,500 2,186,063
-----------
7,402,426
-----------
Oil & Gas (Refining & Marketing) -- 0.3%
Ultramar Diamond Shamrock Corp. .................. 73,700 1,727,344
Oil (Domestic Integrated) -- 0.8%
Amerada Hess Corp. ............................... 19,800 1,355,063
Occidental Petroleum Corp. ....................... 85,700 1,853,263
Phillips Petroleum Co. ........................... 14,400 891,000
-----------
4,099,326
-----------
Oil (International Integrated) -- 3.0%
Chevron Corp. .................................... 49,800 4,208,100
Exxon Mobil Corp. ................................ 143,100 11,680,538
Texaco, Inc. ..................................... 15,800 813,700
-----------
16,702,338
-----------
Paper & Forest Products -- 0.4%
International Paper Co. .......................... 25,100 800,063
Westvaco Corp. ................................... 38,100 1,042,988
Weyerhaeuser Co. ................................. 9,400 435,338
-----------
2,278,389
-----------
Personal Care -- 0.1%
Alberto-Culver Co. Class B ....................... 20,800 588,900
Publishing -- 0.1%
Reader's Digest Association, Inc. (The) Class A .. 16,500 635,250
Publishing (Newspapers) -- 1.5%
Dow Jones & Co., Inc. ............................ 31,000 1,939,438
Gannett Co., Inc. ................................ 27,500 1,557,188
Knight-Ridder, Inc. .............................. 23,800 1,300,075
New York Times Co. (The) Class A ................. 50,300 1,971,131
Tribune Co. ...................................... 34,500 1,231,219
-----------
7,999,051
-----------
Railroads-- 0.2%
Union Pacific Corp. .............................. 31,500 1,252,125
Retail (Building Supplies) -- 0.7%
Home Depot, Inc. (The) ........................... 70,000 3,364,375
Lowe's Cos., Inc. ................................ 14,100 631,856
-----------
3,996,231
-----------
Retail (Computers & Electronics) -- 0.6%
Best Buy Co., Inc.(b) ............................ 20,400 1,259,700
Tech Data Corp.(b) ............................... 37,100 1,915,288
-----------
3,174,988
-----------
Retail (Department Stores) -- 0.1%
Neiman Marcus Group, Inc. (The) Class A(b) ....... 14,500 486,656
Retail (Food Chains) -- 0.2%
Safeway, Inc.(b) ................................. 24,800 1,222,950
Retail (General Merchandise) -- 1.4%
Sears, Roebuck & Co. ............................. 32,200 1,004,238
Target Corp. ..................................... 25,000 581,250
Wal-Mart Stores, Inc. ............................ 131,000 6,214,313
-----------
7,799,801
-----------
Retail (Specialty) -- 0.3%
Tiffany & Co. .................................... 14,800 616,050
Zale Corp.(b) .................................... 21,200 783,075
-----------
1,399,125
-----------
Retail (Specialty-Apparel) -- 0.1%
Talbots, Inc. (The) .............................. 9,400 629,213
Services (Advertising/Marketing) -- 0.1%
Omnicom Group, Inc. .............................. 5,600 467,250
Services (Commercial & Consumer) -- 0.1%
Cendant Corp.(b) ................................. 60,000 791,250
Services (Computer Systems) -- 0.5%
Computer Sciences Corp.(b) ....................... 14,000 1,106,875
Electronic Data Systems Corp. .................... 30,800 1,534,225
-----------
2,641,100
-----------
Services (Data Processing) -- 0.8%
Concord EFS, Inc.(b) ............................. 18,400 591,100
First Data Corp. ................................. 48,400 2,308,075
Fiserv, Inc.(b) .................................. 30,700 1,663,556
-----------
4,562,731
-----------
Shipping -- 0.2%
Teekay Shipping Corp. ............................ 17,700 818,625
Telecommunications (Cellular/Wireless) -- 0.7%
Nextel Communications, Inc. Class A(b) ........... 31,400 1,740,738
Sprint Corp. (PCS Group)(b)....................... 41,400 2,077,763
-----------
3,818,501
-----------
See Notes to Financial Statements
17
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
SHARES VALUE
------ -----
Telecommunications (Long Distance) -- 1.2%
AT&T Corp. ....................................... 27,800 $ 875,700
Sprint Corp. (FON Group) ......................... 51,500 1,725,250
WorldCom, Inc.(b) ................................ 115,000 4,197,500
-----------
6,798,450
-----------
Telephone -- 2.6%
BellSouth Corp. .................................. 125,400 4,678,988
SBC Communications, Inc. ......................... 113,700 4,746,975
Verizon Communications ........................... 105,700 4,611,163
-----------
14,037,126
-----------
Textiles (Apparel) -- 0.1%
Jones Apparel Group, Inc.(b) ..................... 21,100 516,950
Tobacco -- 1.0%
Philip Morris Cos., Inc. ......................... 186,200 5,516,175
-----------------------------------------------------------------------------
Total Common Stocks
(Identified cost $401,733,607) 508,119,550
-----------------------------------------------------------------------------
FOREIGN COMMON STOCKS -- 3.5%
Communications Equipment -- 1.2%
Nortel Networks Corp. (Canada) ................... 83,800 6,834,937
Foods -- 0.3%
Unilever NV NY Registered Shares (Netherlands) ... 35,900 1,696,275
Manufacturing (Diversified) -- 1.0%
Tyco International Ltd. (Bermuda) ................ 97,600 5,563,200
Oil (Domestic Integrated) -- 1.0%
Royal Dutch Petroleum Co. NY Registered Shares
(Netherlands) .................................... 85,000 5,200,938
-----------------------------------------------------------------------------
Total Foreign Common Stocks
(Identified cost $12,767,449) 19,295,350
-----------------------------------------------------------------------------
UNIT INVESTMENT TRUSTS -- 2.9%
S&P 500 Depository Receipts ...................... 104,500 15,923,187
-----------------------------------------------------------------------------
Total Unit Investment Trusts
(Identified cost $13,363,252) 15,923,187
-----------------------------------------------------------------------------
Total Long-Term Investments--99.0%
(Identified cost $427,864,308) 543,338,087
-----------------------------------------------------------------------------
STANDARD
& POOR'S PAR
RATING VALUE
(Unaudited) (000)
----------- -----
SHORT-TERM OBLIGATIONS -- 0.8%
Commercial Paper -- 0.8%
Alcoa, Inc. 6.65%, 9/1/00 A-1 $2,000 2,000,000
Lexington Parker Capital Co. 6.68%, 9/1/00 A-1 2,350 2,350,000
-----------------------------------------------------------------------------
Total Short-Term Obligations
(Identified cost $4,350,000) 4,350,000
-----------------------------------------------------------------------------
TOTAL INVESTMENTS -- 99.8%
(Identified cost $432,214,308) 547,688,087(a)
Cash and receivables, less liabilities--0.2% 846,373
------------
NET ASSETS--100.0% $548,534,460
============
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $137,598,526 and gross
depreciation of $23,025,564 for federal income tax purposes. At August 31,
2000, the aggregate cost of securities for federal income tax purposes was
$433,115,125.
(b) Non-income producing.
See Notes to Financial Statements
18
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
STATEMENT OF ASSETS AND LIABILITIES
AUGUST 31, 2000
Assets
Investment securities at value
(Identified cost $432,214,308) $ 547,688,087
Cash 1,709
Receivables
Investment securities sold 19,975,498
Fund shares sold 1,706,254
Dividends and interest 797,366
Prepaid expenses 1,652
-------------
Total assets 570,170,566
-------------
Liabilities
Payables
Investment securities purchased 20,262,620
Fund shares repurchased 539,790
Investment advisory fee 327,063
Distribution fee 268,270
Transfer agent fee 94,045
Financial agent fee 27,678
Trustees' fee 8,342
Custodian fee 4,163
Accrued expenses 104,135
-------------
Total liabilities 21,636,106
-------------
Net Assets $ 548,534,460
=============
Net Assets Consist of:
Capital paid in on shares of beneficial interest $ 436,038,751
Accumulated net realized loss (2,978,070)
Net unrealized appreciation 115,473,779
-------------
Net Assets $ 548,534,460
=============
Class A
Shares of beneficial interest outstanding, $1 par value
unlimited authorization (Net Assets $294,415,914) 17,467,946
Net asset value per share $16.85
Offering price per share $16.85/(1-5.75%) $17.88
Class B
Shares of beneficial interest outstanding, $1 par value,
unlimited authorization (Net Assets $147,846,267) 8,938,507
Net asset value and offering price per share $16.54
Class C
Shares of beneficial interest outstanding, $1 par value
unlimited authorization (Net Assets $106,272,279) 6,423,221
Net asset value and offering price per share $16.55
STATEMENT OF OPERATIONS
YEAR ENDED AUGUST 31, 2000
Investment Income
Dividends $ 6,328,973
Interest 115,721
Foreign taxes withheld (39,013)
------------
Total investment income 6,405,681
------------
Expenses
Investment advisory fee 3,483,315
Distribution fee, Class A 630,606
Distribution fee, Class B 1,284,671
Distribution fee, Class C 837,324
Financial agent fee 318,157
Transfer agent 793,640
Registration 80,837
Printing 57,796
Custodian 46,283
Professional 42,593
Trustees 27,994
Miscellaneous 22,277
------------
Total expenses 7,625,493
Less expenses borne by investment adviser (229,013)
------------
Net expenses 7,396,480
------------
Net investment loss (990,799)
------------
Net Realized and Unrealized Gain (Loss) on Investments
Net realized loss on securities (2,594,322)
Net change in unrealized appreciation (depreciation) on
investments 75,794,989
------------
Net gain on investments 73,200,667
------------
Net increase in net assets resulting from operations $ 72,209,868
============
See Notes to Financial Statements
19
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Ended Year Ended
8/31/00 8/31/99
------------- -------------
<S> <C> <C>
From Operations
Net investment income (loss) $ (990,799) $ 282,288
Net realized gain (loss) (2,594,322) 4,981,093
Net change in unrealized appreciation (depreciation) 75,794,989 56,853,081
------------- -------------
Increase (decrease) in net assets resulting from operations 72,209,868 62,116,462
------------- -------------
From Distributions to Shareholders
Net investment income, Class A (285,388) (178,877)
Net realized gains, Class A (2,877,590) (815,230)
Net realized gains, Class B (1,487,251) (384,053)
Net realized gains, Class C (909,767) (153,155)
In excess of net realized gains, Class A (15,321) --
In excess of net realized gains, Class B (7,918) --
In excess of net realized gains, Class C (4,844) --
------------- -------------
Decrease in net assets from distributions to shareholders (5,588,079) (1,531,315)
------------- -------------
From Share Transactions
Class A
Proceeds from sales of shares (8,147,516 and 9,742,443 shares, respectively) 125,678,816 132,907,595
Net asset value of shares issued from reinvestment of distributions
(184,841 and 67,491 shares, respectively) 2,859,487 889,551
Cost of shares repurchased (5,185,684 and 2,786,606 shares, respectively) (80,123,000) (37,852,057)
------------- -------------
Total 48,415,303 95,945,089
------------- -------------
Class B
Proceeds from sales of shares (2,778,833 and 5,216,234 shares, respectively) 42,118,702 70,319,755
Net asset value of shares issued from reinvestment of distributions
(91,070 and 25,028 shares, respectively) 1,389,726 327,525
Cost of shares repurchased (1,518,323 and 721,133 shares, respectively) (23,055,705) (9,785,374)
------------- -------------
Total 20,452,723 60,861,906
------------- -------------
Class C
Proceeds from sales of shares (2,987,969 and 3,277,763 shares, respectively) 45,432,616 44,490,555
Net asset value of shares issued from reinvestment of distributions
(57,858 and 10,341 shares, respectively) 882,890 135,365
Cost of shares repurchased (726,231 and 252,075 shares, respectively) (11,166,175) (3,514,530)
------------- -------------
Total 35,149,331 41,111,390
------------- -------------
Class M
Cost of shares repurchased (0 and 11,751 shares, respectively) -- (140,889)
------------- -------------
Total -- (140,889)
------------- -------------
Increase (decrease) in net assets from share transactions 104,017,357 197,777,496
------------- -------------
Net increase (decrease) in net assets 170,639,146 258,362,643
Net Assets
Beginning of period 377,895,314 119,532,671
------------- -------------
End of period [including undistributed net investment income of
$0 and $285,388, respectively] $ 548,534,460 $ 377,895,314
== ========= ============= =============
</TABLE>
See Notes to Financial Statements
20
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
<TABLE>
<CAPTION>
CLASS A
--------------------------------------
From
Year Ended August 31 Inception
---------------------- 9/25/97 to
2000 1999 8/31/98
<S> <C> <C> <C>
Net asset value, beginning of period $ 14.61 $ 10.47 $ 10.00
Income from investment operations
Net investment income (loss)(1) 0.02 0.06 0.06
Net realized and unrealized gain (loss) 2.42 4.19 0.48
-------- -------- -------
Total from investment operations 2.44 4.25 0.54
-------- -------- -------
Less distributions
Dividends from net investment income (0.02) (0.02) (0.04)
Dividends from net realized gains (0.18) (0.09) (0.03)
-------- -------- -------
Total distributions (0.20) (0.11) (0.07)
-------- -------- -------
Change in net asset value 2.24 4.14 0.47
-------- -------- -------
Net asset value, end of period $ 16.85 $ 14.61 $ 10.47
======== ======== =======
Total return(2) 16.83% 40.72% 5.39%(5)
Ratios/supplemental data:
Net assets, end of period (thousands) $294,416 $209,210 $76,399
Ratio to average net assets of:
Operating expenses(3) 1.25% 1.22%(7) 1.25%(6)
Net investment income (loss) 0.13% 0.43% 0.57%(6)
Portfolio turnover 55% 71% 106%(5)
</TABLE>
<TABLE>
<CAPTION>
CLASS B
--------------------------------------
From
Year Ended August 31 Inception
---------------------- 9/25/97 to
2000 1999 8/31/98
<S> <C> <C> <C>
Net asset value, beginning of period $ 14.43 $ 10.40 $ 10.00
Income from investment operations
Net investment income (loss)(1) (0.10) (0.04) (0.02)
Net realized and unrealized gain (loss) 2.39 4.16 0.48
-------- -------- -------
Total from investment operations 2.29 4.12 0.46
-------- -------- -------
Less distributions
Dividends from net investment income -- -- (0.03)
Dividends from net realized gains (0.18) (0.09) (0.03)
-------- -------- -------
Total distributions (0.18) (0.09) (0.06)
-------- -------- -------
Change in net asset value 2.11 4.03 0.40
-------- -------- -------
Net asset value, end of period $ 16.54 $ 14.43 $ 10.40
======== ======== =======
Total return(2) 15.99% 39.72% 4.59%(5)
Ratios/supplemental data:
Net assets, end of period (thousands) $147,846 $109,461 $31,902
Ratio to average net assets of:
Operating expenses(4) 2.00% 1.96%(7) 2.00%(6)
Net investment income (loss) (0.62)% (0.32)% (0.19)%(6)
Portfolio turnover 55% 71% 106%(5)
</TABLE>
(1) Computed using average shares outstanding.
(2) Maximum sales charges are not reflected in the total return calculation.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 1.30%,
1.33% and 1.88% for the periods ended August 31, 2000, 1999 and 1998,
respectively.
(4) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.05%,
2.08% and 2.63% for the periods ended August 31, 2000, 1999 and 1998,
respectively.
(5) Not annualized.
(6) Annualized.
(7) For the year ended August 31, 1999, the ratio of operating expenses to
average net assets excludes the effect of expense offsets for custodian
fees; if expense offsets were included, the ratio would not significantly
differ.
See Notes to Financial Statements
21
<PAGE>
Phoenix-Oakhurst Growth & Income Fund
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
<TABLE>
<CAPTION>
CLASS C
--------------------------------------
From
Year Ended August 31 Inception
---------------------- 9/25/97 to
2000 1999 8/31/98
<S> <C> <C> <C>
Net asset value, beginning of period $ 14.43 $ 10.41 $ 10.00
Income from investment operations
Net investment income (loss)(1) (0.10) (0.04) (0.02)
Net realized and unrealized gain (loss) 2.40 4.15 0.49
-------- ------- -------
Total from investment operations 2.30 4.11 0.47
-------- ------- -------
Less distributions
Dividends from net investment income -- (0.03)
Dividends from net realized gains (0.18) (0.09) (0.03)
-------- ------- -------
Total distributions (0.18) (0.09) (0.06)
-------- ------- -------
Change in net asset value 2.12 4.02 0.41
-------- ------- -------
Net asset value, end of period $ 16.55 $ 14.43 $ 10.41
======== ======= =======
Total return(2) 16.06% 39.58% 4.67%(4)
Ratios/supplemental data:
Net assets, end of period (thousands) $106,272 $59,224 $11,108
Ratio to average net assets of:
Operating expenses(3) 2.00% 1.96%(6) 2.00%(5)
Net investment income (loss) (0.62)% (0.33)% (0.18)%(5)
Portfolio turnover 55% 71% 106%(4)
</TABLE>
(1) Computed using average shares outstanding.
(2) Maximum sales charges are not reflected in the total return calculation.
(3) If the investment adviser had not waived fees and reimbursed expenses, the
ratio of operating expenses to average net assets would have been 2.05%,
2.08% and 2.63% for the periods ended August 31, 2000, 1999 and 1998,
respectively.
(4) Not annualized.
(5) Annualized.
(6) For the year ended August 31, 1999, the ratio of operating expenses to
average net assets excludes the effect of expense offsets for custodian
fees; if expense offsets were included, the ratio would not significantly
differ.
See Notes to Financial Statements
22
<PAGE>
Phoenix Equity Series Fund
Notes to Financial Statements
August 31, 2000
1. SIGNIFICANT ACCOUNTING POLICIES
The Phoenix Equity Series Fund (the "Trust") is organized as a
Massachusetts business trust and is registered under the Investment Company Act
of 1940, as amended, as a diversified, open-end management investment company
whose shares are offered in two separate Series, each a "Fund". Each Fund has
distinct investment objectives.
Phoenix-Duff & Phelps Core Equity Fund seeks long-term capital
appreciation by investing in a diversified portfolio of common stocks.
Phoenix-Oakhurst Growth & Income Fund seeks dividend growth, current income and
capital appreciation by investing in common stocks.
Each Fund offers Class A, Class B and Class C shares. Class M shares have
been closed. Effective April 3, 2000 Class A shares are sold with a front-end
sales charge of up to 5.75%. Prior to that date, the maximum sales charge was
4.75%. Class B shares are sold with a contingent deferred sales charge which
declines from 5% to zero depending on the period of time the shares are held.
Class C shares are sold with a 1% contingent deferred sales charge if redeemed
within one year of purchase. All classes of shares have identical voting,
dividend, liquidation and other rights and the same terms and conditions, except
that each class bears different distribution expenses and has exclusive voting
rights with respect to its distribution plan. Income and expenses of each Fund
are borne pro rata by the holders of all classes of shares, except that each
class bears distribution expenses unique to that class.
The following is a summery of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that effect the reported amounts of assets, liabilities,
revenues and expenses. Actual results could differ from those estimates.
A. Security valuation:
Equity securities are valued at the last sales price, or if there had been
no sale that day, at the last bid price. Debt securities are valued on the basis
of broker quotations or valuations provided by a pricing service which utilizes
information with respect to recent sales, market transactions in comparable
securities, quotations from dealers, and various relationships between
securities in determining value. Short-term investments having a remaining
maturity of 60 days or less are valued at amortized cost which approximates
market. All other securities and assets are valued at fair value as determined
in good faith by or under the direction of the Trustees.
B. Security transactions and related income:
Security transaction are recorded on the trade date. Interest income is
recorded on the accrual basis. Dividend income is recorded on the ex-dividend
date or, in the case of certain foreign securities, as soon as the Fund is
notified. The Trust does not amortize premiums but does accrete discounts using
the effective interest method. Realized gains and losses are determined on the
identified cost basis.
C. Income taxes:
Each Fund is treated as a separate taxable entity. It is the policy of
each Fund in the Trust to comply with the requirements of the Internal Revenue
Code (the "Code"), applicable to regulated investment companies, and to
distribute all of its taxable income to its shareholders. In addition, each Fund
intends to distribute an amount sufficient to avoid imposition of any excise tax
under Section 4982 of the Code. Therefore, no provision for federal income taxes
or excise taxes has been made.
D. Distributions to shareholders:
Distributions are recorded by each Fund on the ex-dividend date. Income
and capital gain distributions are determined in accordance with the income tax
regulations which may differ from generally accepted accounting principles.
These differences include the treatment of non-taxable dividends, foreign
currency gain/loss, partnerships, operating losses and losses deferred due to
wash sales and excise tax regulations. Permanent book and tax basis differences
relating to shareholder distribution will result in reclassifications to paid in
capital.
E. Foreign currency transaction:
Foreign securities and other assets and liabilities are valued using the
foreign currency exchange rate effective at the end of the reporting period.
Cost of investments is translated at the currency exchange rate effective at the
trade date. The gain or loss resulting from a change in currency exchange rates
between the trade and settlement dates of a portfolio transaction is treated as
a gain or loss on foreign currency. Likewise, the gain or loss resulting from a
change in currency exchange rates between the date income is accrued and paid is
treated as a gain or loss on foreign currency. The Trust does not separate that
portion of the results of operations arising from changes in exchange rates and
that portion arising from changes in the market prices of securities.
F. Forward currency contracts:
Each Fund may enter into forward currency contracts on conjunction with
the planned purchase or sale of foreign denominated securities in order to hedge
the U.S. dollar cost or proceeds. Forward currency contracts involve, to varying
degrees, elements of market risk in excess of the amount recognized in the
statement of assets and
23
<PAGE>
Phoenix Equity Series Fund
Notes to Financial Statements
August 31, 2000 (Continued)
liabilities. Risks arise from the possible movements in foreign exchange rates
or if the counterparty does not perform under the contract.
A forward currency contract involves an obligation to purchase or sell a
specific currency at a future date, which may be any number of days from the
date of the contract agreed upon by the parties, at a price set at the time of
the contract. These contracts are traded directly between currency traders and
their customers. The contract is marked-to-market daily and the change in the
market value is recorded by each Fund as an unrealized gain (or loss). When the
contract is closed or offset with the same counterparty, the Fund records a
realized gain (or loss) equal to the change in the value of the contract when it
was opened and the value at the time it was closed or offset.
G. Options:
Each Fund may write covered options or purchase options contracts for the
purpose of hedging against changes in the market value of the underlying
securities or foreign currencies.
Each Fund will realize a gain or loss upon the expiration or closing of
the option transaction. Gains and losses on written options are reported
separately in the Statement of Operations. When a written option is exercised,
the proceeds on the sales or amounts paid are adjusted by the amount if premium
received. Options written are reported as a liability in the Statement of Assets
and Liabilities and subsequently marked-to-market to reflect the current value
of the option. The risk associated with written options is that the change in
value of options contracts may not correspond to the change in value of the
hedged instruments. In addition, losses may arise from changes in the value of
the underlying instruments, or if a liquid secondary market does not exist for
the contracts.
Each Fund may purchase options which are included in the Funds' Schedule
of Investments and subsequently marked-to-market to reflect the current value of
the option. When a purchased option is exercised, the cost of the security is
adjusted by the amount of premium paid. The risk associated with purchased
options is limited to the premium paid.
H. Expenses:
Expenses incurred by the Trust with respect to more than one Fund are
allocated in proportion to the net assets of each Fund, except where allocation
of direct expense to each Fund or an alternative allocation method can be more
fairly made.
I. Repurchase agreements:
A repurchase agreement is a transaction where a Fund acquires a security
for cash and obtains simultaneous commitment from the seller to repurchase the
security at an agreed upon price and date. Each Fund, through its custodian,
takes possession of securities collateralizing the repurchase agreement. The
collateral is marked-to-market daily to ensure that the market value of the
underlying assets remains sufficient to protect the Fund in the event of default
by the seller. If the seller defaults and the value of the collateral declines,
or, if the seller enters insolvency proceedings, realization of collateral may
be delayed or limited.
2. INVESTMENT ADVISORY FEE AND RELATED PARTY TRANSACTIONS
The advisors to the Trust are Duff & Phelps Investment Management Co.
("DPIM") and Phoenix Investment Counsel, Inc. ("PIC"). DPIM is a subsidiary of
Phoenix Investment Partners Ltd., which is an indirect, majority-owned
subsidiary of Phoenix Home Life Mutual Insurance Company ("PHL"), PIC is an
indirect, majority-owned subsidiary of PHL. As compensation for their services
to the Trust, the Advisors are entitled to a fee based upon the following annual
rates as a percentage of the average daily net assets of each separate Fund:
1st $1 $1 2 $2+
Fund Advisor Billion Billion Billion
---- ------- ------- ------- -------
Core Equity Fund........... DPIM 0.75% 0.70% 0.65%
Growth & Income Fund....... PIC 0.75% 0.70% 0.65%
The Advisors have voluntarily agreed to assume total fund operating
expenses of each respective Fund, excluding interest, taxes, brokerage fees,
commissions and extraordinary expenses until August, 31, 2001, to the extent
that such expenses exceed the following percentages of average annual net
assets:
Class A Class B Class C
------- ------- -------
1.25% 2.00% 2.00%
Phoenix Equity Planning Corporation ("PEPCO"), an indirect, majority-owned
subsidiary of PHL, serves as the national distributor of the Trust's shares.
PEPCO has advised the Trust that it retained net selling commissions of $92,986
for Class A Shares, and deferred sales charges of $391,433 for Class B shares
and $28,358 for Class C shares for the fiscal year ended August 31, 2000. In
addition, each Fund pays PEPCO a distribution fee at an annual rate of 0.25% for
Class A shares, 1.00% for Class B shares and 1.00% for Class C shares applied to
the average daily net assets of the Fund. The Distributor has advised the Trust
that of the total amount expensed for the year ended August 31, 2000, $1,827,507
was retained by the Distributor, $1,010,328 was paid to unaffiliated
participants, and $85,707 was paid to W.S. Griffith, and indirect subsidiary of
PHL.
As Financial Agent of the Trust, PEPCO receives a financial agent fee
equal to the sum of (1) the documented cost of fund accounting
24
<PAGE>
Phoenix Equity Series Fund
Notes to Financial Statements
August 31, 2000 (Continued)
and related services provided by PFPC Inc. (subagent to PEPCO), plus (2) the
documented cost to PEPCO to provide financial reporting, tax services and
oversight of the subagents performance. For the year ended August 31, 2000,
financial agent fees were $391,386, of which PEPCO received $82,360. The current
fee schedule of PFPC Inc. ranges from 0.085% to 0.0125% of the average daily net
asset values of each Fund. Certain minimum fees and waivers may apply.
PEPCO serves as the Trust's Transfer Agent with State Street Bank and
Trust Company as sub-transfer agent. For the year ended August 31, 2000,
transfer agent fees were $866,700 of which PEPCO retained $269,312 which is net
of the fees paid to State Street.
At August 31, 2000, PHL and affiliates held Trust shares which aggregated
the following:
Aggregate
Net Asset
Shares Value
--------- -----------
Core Equity Fund--Class A........ 1,375,977 $18,052,818
3. PURCHASE AND SALE OF SECURITIES
Purchases and sales of securities during the year ended August 31, 2000
(excluding U.S. Government and agency securities and short-term securities)
aggregated the following:
Purchases Sales
------------ ------------
Core Equity Fund............ $ 31,912,129 $ 51,956,665
Growth & Income Fund........ 345,143,598 251,550,109
There were no purchases or sales of long-term U.S. Government and agency
securities during the year ended August 31, 2000.
4. CREDIT RISK
In countries with limited or developing markets, investments may present
greater risks than in more developed markets and the prices of such investments
may be volatile. The consequences of political, social or economic changes in
these markets may have disruptive effects in the market prices of these
investments and the income they generate, as well as a Fund's ability to
repatriate such amounts.
5. CAPITAL LOSS CARRYOVERS
At August 31, 2000, the Growth & Income Fund had a capital loss carryover
of $1,107,211, expiring in 2008. This may be used to offset future capital
gains.
Under current tax law, capital loss realized after October 31 may be
deferred and treated as occurring on the first business day of the following
fiscal year. For the year ended August 31, 2000, the Growth & Income Fund
deferred capital losses of $966,490.
6. RECLASSIFICATION OF CAPITAL ACCOUNTS
In accordance with accounting pronouncemnts, the Trust has recorded
several reclassifications in the capital accounts. These reclassifications have
no impact on the net asset value of the Fund and are designed generally to
present undistributed income and realized gains on a tax basis which is
considered to be more informative to the shareholder. As of August 31, 2000,
each Fund recorded the following reclassifications to increase (decrease) the
accounts listed below:
Capital paid
Undistributed Accumulated in on shares
net investment net realized of beneficial
income gain(loss) interest
-------------- ------------ -------------
Core Equity Fund $ 146,619 -- $ (146,619)
Growth & Income Fund 990,799 28,083 (1,018,882)
This report is not authorized for distibution to prospective investors in
the Phoenix Equity Series Fund unless preceded or accompanied by an effective
prospectus which includes information concerning the sales charge, the Fund's
record and other pertinent information.
25
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
PRICEWATERHOUSECOOPERS [LOGO]
To the Trustees and Shareholders of
Phoenix Equity Series Fund:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments (except for bond ratings), and the
related statements of operations and of changes in net assets, and the financial
highlights present fairly, in all material respects, the financial position of
the Phoenix-Duff & Phelps Core Equity Fund and the Phoenix-Oakhurst Growth &
Income Fund (constituting the Phoenix Equity Series Fund, hereinafter referred
to as the "Fund") at August 31, 2000, the results of each of their operations,
the changes in each of their net assets and the financial highlights for the
periods indicated, in conformity with accounting principles generally accepted
in the United States of America. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States of America, which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at August
31, 2000 by correspondence with the custodian and brokers, provide a reasonable
basis for our opinion.
/s/ PriceWaterhouseCoopers LLP
Boston, Massachusetts
October 12, 2000
26
<PAGE>
RESULTS OF SHAREHOLDER MEETING (Unaudited)
A special meeting of Shareholders of Phoenix Equity Series Fund was held on May
16, 2000 to approve the following matters:
1. Approve a new Rule 12b-1 Distribution Plan for Class B Shares
2. Approve a new Rule 12b-1 Distribution Plan for Class C Shares
On the record date for these meetings, the shares outstanding and
percentage of the shares outstanding and entitled to vote that were present by
proxy were as follows:
<TABLE>
<CAPTION>
Class of Shares Shares outstanding Percentage present by proxy
--------------- ------------------ ---------------------------
<S> <C> <C>
Phoenix-Duff & Phelps Core Equity Fund Class B 530,964 50.10%
Phoenix-Duff & Phelps Core Equity Fund Class C 161,822 50.91%
Phoenix-Oakhurst Growth & Income Fund Class B 8,441,534 50.10%
Phoenix-Oakhurst Growth & Income Fund Class C 5,700,812 50.46%
</TABLE>
NUMBER OF VOTES
<TABLE>
<CAPTION>
For Against Abstain
------------- ---------- ----------
<S> <C> <C> <C>
1. Approve a new Rule 12b-1 Distribution Plan for Class B Shares
Phoenix-Duff & Phelps Core Equity Fund Class B 243,362 2,880 19,776
Phoenix-Oakhurst Growth & Income Fund Class B 3,774,705 129,400 325,428
2. Approve a new Rule 12b-1 Distribution Plan for Class C Shares
Phoenix-Duff & Phelps Core Equity Fund Class C 62,155 802 19,422
Phoenix-Oakhurst Growth & Income Fund Class C 2,447,102 99,758 330,013
</TABLE>
27
<PAGE>
Phoenix Equity Series Fund
101 Munson Street
Greenfield, Massachusetts 01301
Trustees
Robert Chesek
E. Virgil Conway
Harry Dalzell-Payne
Francis E. Jeffries
Leroy Keith, Jr.
Philip R. McLoughlin
Everett L. Morris
James M. Oates
Herbert Roth, Jr.
Richard E. Segerson
Lowell P. Weicker, Jr.
Officers
Philip R. McLoughlin, President
Michael E. Haylon, Executive Vice President
John F. Sharry, Executive Vice President
Steven L. Colton, Vice President
Robert S. Driessen, Vice President
William R. Moyer, Vice President
Diane L. Mustain, Vice President
Nancy G. Curtiss, Treasurer
G. Jeffery Bohne, Secretary
Nancy J. Engberg, Assistant Secretary
Investement Advisors
Duff & Phelps Investment Management Co.
(Phoenix-Duff & Phelps Core Equity Fund)
55 East Monroe Street
Suite 3800
Chicago, Illinois 60603
Phoenix Investment Counsel, Inc.
(Phoenix-Oakhurts Growth & Income Fund)
56 Prospect Street
Hartford, Connecticut 06115-0480
Principle Underwriter
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, Massachusetts 02101
Transfer Agent
Phoenix Equity Planning Corporation
100 Bright Meadow Boulevard
P.O. Box 2200
Enfield, Connecticut 06083-2200
Independent Accountants
PricewaterhouseCoopers LLP
160 Federal Street
Boston, Massachusetts 02110
How to Contact Us
The Fund Connection 1-800-243-1574
Customer Service 1-800-243-1574
Investment Strategy Hotline 1-800-243-4361 (option 2)
Marketing Department 1-800-243-4361 (option 3)
Text Telephone 1-800-243-1926
www.phoenixinvestments.com
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IBC (blank)
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Phoenix Equity Planning Corporation
PO Box 2200
Enfield CT 06083-2200
[LOGO] PHOENIX
INVESTMENT PARTNERS
For more information about
Phoenix mutual funds, please call
your financial representative or
contact us at 1-800-243-4361 or
www.phoenixinvestments.com.
PXP 213 (10/00)
<PAGE>
Phoenix Equity Planning Corporation -------------------
PO Box 2200 Presorted Standard
Enfield CT 06083-2200 US POSTAGE
PAID
LOUISVILLE KY
PERMIT 1051
[LOGO] PHOENIX -------------------
INVESTMENT PARTNERS
For more information about
Phoenix mutual funds, please call
your financial representative or
contact us at 1-800-243-4361 or
www.phoenixinvestments.com.
PXP 213 (10/00)