THE NEVIS FUND, INC.
ANNUAL REPORT TO SHAREHOLDERS
MAY 31, 2000
THIS ANNUAL REPORT CAN ONLY BE DISTRIBUTED IF PRECEDED OR
ACCOMPANIED BY A PROSPECTUS.
<PAGE>
LETTER TO SHAREHOLDERS THE NEVIS FUND, INC.
July 7, 2000
DEAR FELLOW SHAREHOLDER:
We are pleased to report strong results for The Nevis Fund's fiscal year-end May
31, 2000. Your Fund's NAV on May 31, 2000 was $30.98, up 77.91% from its value
of $19.01 on May 31, 1999 (after adjusting for a capital gain distribution of
$2.65 per share, paid on November 9, 1999). This performance ranks your Fund as
number 18 out of 1,255 U.S. Growth Funds for the year ending May 31, 2000,
according to Lipper Analytical Services. These results also compare favorably to
the S&P 500 and the Russell 2000, which returned 11.1% and 10.3% respectively
for the same period. Please read the accompanying "Manager's Discussion and
Analysis of Fund Performance" for a discussion of certain key factors that
contributed to the Fund's performance.
The Nevis Fund's investment objective is to achieve strong returns through
long-term capital appreciation. Our investment strategy is founded on the belief
that over time, the performance of a company's stock will track the growth of
its earnings. We look for companies capable of experiencing high returns on
capital and positive cash flows. We are excited about the prospects for the
companies in the Fund. We believe we have assembled an outstanding portfolio of
businesses run by highly qualified and incented management teams.
We would like to take this opportunity to welcome those of you who have
purchased The Nevis Fund within the last year. Unlike many other mutual funds,
The Nevis Fund owns only a limited number of companies. On May 31, 2000, your
Fund owned 26 companies with the top 10 stocks representing 71% of the total
Fund. This level of concentration means that your Fund will likely be more
volatile than the major market indices. Over the long-term, though, we believe
that a focused portfolio has the potential to deliver superior returns.
Thank you for your support.
/s/signature /s/signature
David R. Wilmerding, III Jon C. Baker
Co-manager Co-manager
<PAGE>
MANAGER'S DISCUSSION AND ANALYSIS OF FUND PERFORMANCE
The past year has been another volatile period for stocks. The Nasdaq Composite,
for example, started June 1, 1999, at 2,412.03, surged over 100% to as high as
5,048.62 by March 10, 2000, and then declined by almost 33% to 3,400.91 as of
May 31, 2000. Although the Nasdaq was up over 40% for the year ending May 31,
2000, most investors have focused on the Index's recent decline, wondering
whether this setback represents a longer-term trend. At the core of this setback
appear to be a few specific investor concerns: signs of inflation reappearing;
continued worries over how many rate increases the Fed will invoke to slow the
U.S. economy's growth; and of course, the general fear that U.S. equities
(particularly technology stocks) were trading at unsustainable price/earning
ratios. What triggered the sell off is still not clear. Perhaps it was the
recent rise in the price of oil -- or maybe the imminent tax liabilities of the
over-extended day traders. Either way, it seems that investors may be realizing
that the Emperor (the "New Economy") may, indeed, not be as well clothed as
previously thought. The promises of the Internet and the new, virtual economy
had provided unprecedented access to private and public capital at exceedingly
beneficial prices for the "seller." But while the promise of the Internet
remains intact, the profits generated by companies from the Internet have been
slow to materialize. The market's recent actions suggest that the days of
virtually free capital for exciting Internet start-up concepts are over.
When we look back on corrections in the equity markets with the benefit of
hindsight, we inevitably wish we had more cash on hand to take advantage of the
attractive short-term pricing opportunities that irrational selling can create.
After all, the desire to pay the lowest price possible for an attractive asset
is only human nature. Just as important however, is the need to remind ourselves
that attempting to time the market's sell-offs is a loser's game. Statistics
show conclusively that you will make much more money over the long-term if you
buy high quality, growing earnings streams, rather than try to trade the
market's short-term fluctuations.
Your Fund has benefited substantially from initial public offerings (IPOs)
during its most recent fiscal year and since its inception. For example, based
on your Fund's net asset value as of May 31, 2000, and assuming the reinvestment
of distributions to shareholders, we believe that net realized and unrealized
first-day gains from IPOs purchased by the Fund contributed approximately 50.3%
of the Fund's total return during the recent fiscal year, and approximately
69.8% of its total return since commencement of operations.(1) In particular,
the Fund received $10,299,576 ($7.45 per share) of first-day realized or
unrealized gains from IPOs during its recent fiscal year, and $12,919,032
($16.62 per share) in such gains since commencement of operations on June 28,
1998.(2) These gains were particularly noteworthy given the Fund's relatively
small asset base during 1998 and much of 1999.(3) There is no guarantee, and
in fact it is unlikely, that the Fund will benefit from these types of gains in
the future. Moreover, if Fund assets remain at or near current levels, or if
they increase, the impact of future first-day IPO gains, if any, on the Fund
is likely to be substantially lower.
As of May 31, 2000, the Fund's top three holdings -- American Tower, Rational
Software and SBA Communications -- constituted 34.7% of the Fund's assets. The
Nevis Fund is a non-diversified fund with fewer securities than most mutual
funds. As a result of owning concentrated positions the Fund's net asset value
per share may experience greater fluctuations over short periods than other
funds.
--------------------------------------------------------------------------------
(1) The relative percentage of Fund returns attributable to such IPO gains will
vary depending on the day as of which the percentage is calculated and
market conditions. For example, when the Fund reached its peak per share net
asset value of $59.32 on March 13, 2000 (which was only three days after the
Nasdaq Composite Index reached its peak), these first day gains represented
approximately 16.2% of the Fund's total return for the fiscal year through
that date. After that date, the Fund participated in only three subsequent
IPOs during the remainder of the fiscal year that contributed a total of
$.05 per share in additional first day IPO gains.
(2) These amounts represent the change in value between the initial offering
price of each IPO security purchased by the Fund and the closing price of
that security on the first day of trading or, if the Fund sold its IPO
shares on the first day of trading, the change in value between the issue
price and the price at which the shares were sold during the first day of
trading. The first day gains from IPOs for fiscal year 2000 break down to
$1.96 per share in realized gains and $5.48 per share in unrealized gains.
The first day gains for IPOs since inception break down to $6.56 per share
in realized gains and $10.05 per share in unrealized gains.
(3) Fund net assets were $110,000 when operations commenced on June 28, 1998,
$9,975,000 at the end of the Fund's May 31, 1999 fiscal year, and
$197,497,000 at the end of the Fund's May 31, 2000 fiscal year.
<PAGE>
--------------------------------------
Total Return(1)
--------------------------------------
Annualized Cumulative
One Year Inception Inception
Return to Date2 to Date(2)
--------------------------------------
77.91% 88.43% 238.21%
--------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE NEVIS FUND, VERSUS THE RUSSELL 2000 INDEX
[line graph omitted--plot points as follows:]
The Nevis Fund Russell 2000 Index
6/30/98 $10,000 $10,000
May 99 $19,010 $ 9,712
May 00 $33,821 $10,674
(1) These figures represent past performance. Past performance is no guarantee
of future results. The investment return and principal value of an
investment will fluctuate, so an investor's shares, when redeemed, may be
worth more or less than their original cost. There are specific risks,
including increased volatility and above average price fluctuations,
inherent in investing in technology, science and small capitalized
companies. Overall economic conditions were very favorable to the Funds'
performance in 1999 and the first quarter 2000, and may not be sustainable
in the future.
(2) The Nevis Fund commenced operations on June 29, 1998.
Our investment strategy is to identify high quality companies that have the
potential to generate solid growth in real earnings and cash flow. Moreover, we
look for companies that we can hold for the long-term. For example, last year
the top two holdings of the Nevis Fund were Rational Software (RATL) and
American Tower (AMT). This year these same two companies remain the Fund's top
two holdings having appreciated 117% and 65%, respectively. We believe that
companies like Rational and American Tower, which are exhibiting strong growth
in earnings and cash flow, will continue to thrive, particularly in a market
environment that is beginning to focus more on profitability. During the fiscal
year, some of the new holdings we added to the Fund included SBA Communications
(SBAC), Primus Knowledge Solutions (PKSI) and CSG Systems (CSGS).
<PAGE>
STATEMENT OF NET ASSETS THE NEVIS FUND, INC.
May 31, 2000
<TABLE>
<CAPTION>
Market
Value
Shares (000)
------ -------
<S> <C> <C>
COMMON STOCKS 95.3%
AEROSPACE & DEFENSE 1.3%
Armor Holdings* 238,700 $ 2,611
------------------------------------------------------------------------------------------------------------------------------------
BIOLOGICAL PRODUCTS 2.6%
Connetics* 592,300 5,035
------------------------------------------------------------------------------------------------------------------------------------
COMMUNICATION SERVICES 22.8%
American Tower, Cl A* 656,560 24,375
SBA Communications* 556,500 20,730
------------------------------------------------------------------------------------------------------------------------------------
45,105
------------------------------------------------------------------------------------------------------------------------------------
ELECTRONIC COMPONENTS 1.3%
Vicor* 97,975 2,590
------------------------------------------------------------------------------------------------------------------------------------
INFORMATION RETRIEVAL SYSTEMS 3.6%
Agile Software* 148,000 6,198
Infonautics, Cl A* 200,000 825
------------------------------------------------------------------------------------------------------------------------------------
7,023
------------------------------------------------------------------------------------------------------------------------------------
RADIO, TELEVISION BROADCASTING & COMMUNICATIONS EQUIPMENT 3.0%
Tekelec* 180,000 5,940
------------------------------------------------------------------------------------------------------------------------------------
SCHOOLS 1.6%
Lightspan* 375,000 3,117
------------------------------------------------------------------------------------------------------------------------------------
SEMI-CONDUCTORS & RELATED DEVICES 6.9%
Conductus* 530,000 4,439
Vitesse Semiconductor* 181,000 9,163
------------------------------------------------------------------------------------------------------------------------------------
13,602
------------------------------------------------------------------------------------------------------------------------------------
SERVICES-BUSINESS SERVICES 4.3%
Wind River Systems* 234,448 8,499
------------------------------------------------------------------------------------------------------------------------------------
SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN 0.3%
I3 Mobile* 75,000 591
------------------------------------------------------------------------------------------------------------------------------------
SERVICES-COMPUTER PROCESSING & DATA PREPARATION 7.5%
CSG Systems International* 298,300 14,840
------------------------------------------------------------------------------------------------------------------------------------
SERVICES-COMPUTER PROGRAMMING SERVICES 6.9%
Primus Knowledge Solutions* 543,500 13,723
------------------------------------------------------------------------------------------------------------------------------------
SERVICES-COMPUTER RELATED SERVICES 2.4%
Espeed, Cl A* 118,000 3,053
Peapod* 751,600 1,597
------------------------------------------------------------------------------------------------------------------------------------
4,650
------------------------------------------------------------------------------------------------------------------------------------
SERVICES/OTHER ADVERTISING 0.5%
NetCreations* 41,700 1,022
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS THE NEVIS FUND, INC.
May 31, 2000 (concluded)
<TABLE>
<CAPTION>
Market
Shares/Face Value
Amount (000) (000)
------------- ---------
<S> <C> <C>
SERVICES-PREPACKAGED SOFTWARE 25.0%
Ariba* 105,000 $ 5,473
BEA Systems* 260,800 9,421
Commerce One* 70,000 2,505
Hyperion Solutions* 195,000 6,118
Network Associates* 110,600 2,419
Rational Software* 320,250 23,478
------------------------------------------------------------------------------------------------------------------------------------
49,414
------------------------------------------------------------------------------------------------------------------------------------
TELEPHONE COMMUNICATION 0.4%
Net2Phone* 30,000 885
------------------------------------------------------------------------------------------------------------------------------------
TELEVISION BROADCASTING STATIONS 4.9%
Clear Channel Communications* 128,400 9,614
------------------------------------------------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost $228,022) 188,261
------------------------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT 4.2%
Morgan Stanley 6.250%, dated 05/31/00, matures 06/01/00, repurchase price
$8,298,789 (collateralized by U.S. Treasury Bond, total par $8,748,155,
6.300%, 06/01/00,
total market value $8,467,020) (A) $ 8,299 8,299
------------------------------------------------------------------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENT
(Cost $8,299) 8,299
------------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.5%
(Cost $236,321) 196,560
------------------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET 0.5% 937
NET ASSETS:
Portfolio Shares (100,000,000 shares authorized -- par value $.01 per share authorized)
based on 6,374,433 outstanding shares of common stock 247,424
Accumulated net investment loss (7)
Accumulated net realized loss on investments (10,159)
Net unrealized depreciation on investments (39,761)
------------------------------------------------------------------------------------------------------------------------------------
TOTAL NET ASSETS 100.0% $197,497
====================================================================================================================================
Net Asset Value, Offering and Redemption Price Per Share -- Class A $30.98
====================================================================================================================================
</TABLE>
* NON-INCOME PRODUCING SECURITY
(A) TRI-PARTY REPURCHASE AGREEMENT
CL -- CLASS
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF OPERATIONS THE NEVIS FUND, INC.
For the year ended May 31, 2000
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
6/1/99
to
5/31/00
(000)
-----------------
<S> <C>
INVESTMENT INCOME:
Interest Income $ 317
------------------------------------------------------------------------------------------------------------------------------------
Total Investment Income 317
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment Advisory Fees (See Note 4) 1,812
------------------------------------------------------------------------------------------------------------------------------------
Total Expenses 1,812
------------------------------------------------------------------------------------------------------------------------------------
Net Investment Loss (1,495)
------------------------------------------------------------------------------------------------------------------------------------
Net Realized Loss on Investments (7,368)
Net Change in Unrealized Depreciation on Investments (40,491)
------------------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized Loss on Investments (47,859)
------------------------------------------------------------------------------------------------------------------------------------
Net Decrease in Net Assets Resulting from Operations $(49,354)
====================================================================================================================================
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS THE NEVIS FUND, INC.
For the periods ended May 31,
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
6/1/99 6/29/98*
to to
5/31/00 5/31/99
(000) (000)
------------- ----------
<S> <C> <C>
INVESTMENT ACTIVITIES:
Net Investment Loss $ (1,495) $ (23)
Net Realized Gain (Loss) on Investments (7,368) 2,045
Net Change in Unrealized Appreciation (Depreciation) on Investments (40,491) 730
------------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets Resulting From Operations (49,354) 2,752
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS:
Realized Capital Gain (4,621) --
------------------------------------------------------------------------------------------------------------------------------------
SHARE TRANSACTIONS:
Proceeds from Shares Issued 334,745 7,239
Reinvestment of Cash Distributions 4,422 --
Cost of Shares Repurchased (97,670) (16)
------------------------------------------------------------------------------------------------------------------------------------
Increase in Net Assets from Capital Share Transactions 241,497 7,223
------------------------------------------------------------------------------------------------------------------------------------
TOTAL INCREASE IN NET ASSETS 187,522 9,975
------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of Period 9,975 --
------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
End of Period $197,497 $9,975
====================================================================================================================================
CAPITAL SHARE TRANSACTIONS:
Shares Issued 8,207 526
Shares Issued in Lieu of Cash Distributions 153 --
Shares Redeemed (2,511) (1)
------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN SHARES FROM CAPITAL SHARE TRANSACTIONS 5,849 525
====================================================================================================================================
</TABLE>
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
* COMMENCEMENT OF OPERATIONS
The accompanying notes are an integral part of the financial statements.
<PAGE>
FINANCIAL HIGHLIGHTS THE NEVIS FUND, INC.
For a Share Outstanding Throughout Each Period
For the Periods Ended May 31,
<TABLE>
<CAPTION>
Realized Ratio
Net and Net Net of Net
Asset Unrealized Distributions Asset Assets Ratio Investment
Value Net Gains From Value End of Expenses Loss Portfolio
Beginning Investment on Capital End Total of Period to Average to Average Turnover
of Period Loss Securities Gains of Period Return (000) Net Assets Net Assets Rate
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
2000 $19.01 $(0.19) $14.81(2) $(2.65) $30.98 77.91% $197,497 1.50% (1.24)% 56.50%
1999(1) 10.00 (0.01) 9.02 -- 19.01 90.10+ 9,975 1.50* (1.03)* 251.60
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* ANNUALIZED
+ TOTAL RETURN IS FOR THE PERIOD INDICATED AND HAS NOT BEEN ANNUALIZED.
(1) THE NEVIS FUND, INC. COMMENCED OPERATIONS ON JUNE 29, 1998.
(2) THE AMOUNT SHOWN FOR THE YEAR ENDED MAY 31, 2000 FOR A SHARE OUTSTANDING
THROUGHOUT THE PERIOD DOES NOT ACCORD WITH THE AGGREGATE NET GAINS ON
INVESTMENTS FOR THAT PERIOD BECAUSE OF THE SALES AND REPURCHASES OF
PORTFOLIO SHARES IN RELATION TO FLUCTUATING MARKET VALUE OF THE INVESTMENTS
OF THE PORTFOLIO.
The accompanying notes are an integral part of the financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS THE NEVIS FUND, INC.
May 31, 2000
1. ORGANIZATION:
THE NEVIS FUND, INC. (the "Fund") was incorporated in Maryland on February 20,
1998. The Fund is registered under the Investment Company Act of 1940, as
amended, as a non-diversified open-end management investment company. The Fund's
prospectus provides a description of the Fund's investment goals and strategies.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of the significant accounting policies followed by
the Fund.
SECURITY VALUATION -- Investments for which market quotations are readily
available are stated at market value, which is determined using the last
reported sale price from the exchange where the security is primarily
traded. If no sales are reported, as in the case of some securities traded
over-the-counter, the market value is determined by using the last reported
bid price. Short term investments that have remaining maturities of sixty
days or less at time of purchase are valued at amortized cost, if it
approximates market value. The value of other assets and securities for
which no quotations are readily available is determined in good faith at
fair value following procedures approved by the Board of Directors.
FEDERAL INCOME TAXES -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income and net capital gains
to its shareholders. Accordingly, no provision for federal income taxes is
required.
SECURITY TRANSACTIONS AND RELATED INCOME -- Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Costs used in determining realized gains and losses on the sales of
investment securities are based on the specific identification method.
Interest income is recognized on the accrual basis. Dividend income is
recorded on the ex-date.
NET ASSET VALUE PER SHARE -- The net asset value per share of the Fund is
calculated on each business day by dividing the total value of assets, less
liabilities, by the number of shares outstanding.
DISTRIBUTIONS TO SHAREHOLDERS -- Distributions from net investment income
are declared and paid to shareholders annually. Any net realized capital
gains are distributed to shareholders at least annually.
RECLASSIFICATION OF COMPONENTS OF NET ASSETS -- The timing and
characterization of certain income and capital gains distributions are
determined annually in accordance with federal tax regulations which may
differ from generally accepted accounting principles. As a result, net
investment income (loss) and net realized gain (loss) on investment
transactions for the reporting period may differ from distributions during
such period. These book/tax differences may be temporary or permanent in
nature. To the extent these differences are permanent, they are charged or
credited to paid-in-capital, accumulated net realized gain, or undistributed
net investment income, as appropriate, in the period that the differences
arise. Accordingly, the following permanent differences, have been
reclassified to/from the following accounts during the fiscal year ended May
31, 2000:
Undistributed
Accumulated Net Investment
Paid-in-Capital Realized Loss Income
(000) (000) (000)
---------------- ------------- --------------
(1,296) (199) 1,495
For the year ended May 31, 2000, the Portfolio expects to defer for Federal
income tax purposes, post October capital losses of approximately
$7,851,645.
For the year ended May 31, 2000, there were total cumulative wash sales of
$2,307,581.
USE OF ESTIMATES -- The preparation of financial statements in conformity
with generally accepted accounting principles in the United States, 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 revenues and expenses during the reporting period. Actual results could
differ from those estimates.
3. ORGANIZATIONAL COSTS:
Organizational costs have been capitalized by the Fund and are being amortized
over sixty months commencing on the date of inception of the Fund. In the event
the initial shares of the Fund are redeemed by any holder thereof during the
period that the Fund is amortizing its organizational costs, the redemption
proceeds payable to the holder thereof by the Fund will be reduced by the
unamortized organizational costs in the same ratio as the number of initial
shares being redeemed bears to the number of initial shares outstanding at the
time of redemption.
4. INVESTMENT MANAGEMENT ARRANGEMENTS:
The Fund and Nevis Capital Management, Inc. (the "Adviser") are parties to an
Investment Management Agreement under which the Adviser receives an annual fee
equal to 1.50% of the average daily net assets of the Fund. Pursuant to its
Investment Management Agreement with the Fund, the Adviser has agreed to bear
all ordinary expenses incurred by the Fund
<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONCLUDED) THE NEVIS FUND, INC.
May 31, 2000
in the conduct of its operations. The Fund will bear any extraordinary expenses
incurred in the course of its business.
5. ADMINISTRATION, TRANSFER AGENCY AND SERVICES,
CUSTODIAN AND DISTRIBUTION AGREEMENTS:
As discussed above, the Adviser has agreed to bear all ordinary expenses
incurred in the conduct of the Fund's operations. This includes the following
contractual relationships:
The Fund and SEI Investments Mutual Funds Services (the "Administrator") are
parties to an Administration Agreement under which the Administrator provides
administrative services for an annual fee, computed daily and paid monthly, at
the annual rate of 0.12% of the first $100 million of the average daily net
assets of the Fund, 0.10% of the next $100 million of such assets, and 0.08% of
such assets in excess of $200 million subject to a minimum annual fee of
$90,000.
Forum Shareholder Services, LLC (the "Transfer Agent") serves as the transfer
agent and dividend disbursing agent for the Fund under a Transfer Agency and
Services Agreement with the Fund.
The Fund and SEI Investments Distribution Co. (the "Distributor") are parties to
a Distribution Agreement. The Distributor receives no fees for its distribution
services under this agreement.
First Union National Bank serves as custodian (the "Custodian") for the Fund.
The Custodian plays no role in determining the investment policies of the Fund
or which securities are to be purchased and sold by the Fund.
6. INVESTMENT TRANSACTIONS:
The cost of security purchases and the proceeds from security sales, other than
short-term investments, for the year ended May 31, 2000 were as follows:
The Nevis Fund, Inc.
(000)
------------------
Purchases
U.S. Gov't ............................ $ --
Other ................................. 292,762
Sales
U.S. Gov't ............................ $ --
Other ................................. 64,841
At May 31, 2000, the total cost of securities and the net realized gains or
losses on securities sold for federal income tax purposes were not materially
different from amounts reported for financial reporting purposes. The aggregate
gross unrealized appreciation and depreciation for securities held by the Fund
at May 31, 2000, is as follows:
The Nevis Fund, Inc.
(000)
-----------------
Aggregate gross unrealized
appreciation ......................... $ 30,702
Aggregate gross unrealized
depreciation ......................... (70,463)
--------
Net unrealized depreciation ............ $(39,761)
========
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and Board of Directors of
The Nevis Fund, Inc.:
We have audited the accompanying statements of net assets of The Nevis Fund,
Inc. (the "Fund") as of May 31, 2000, and the related statement of operations,
statement of changes in net assets, and financial highlights for the periods
presented. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights. Our procedures included
confirmation of securities owned as of May 31, 2000, by correspondence with the
custodian. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of The
Nevis Fund, Inc. as of May 31, 2000, the results of its operations for the year
then ended, the changes in its net assets for the periods presented, and the
financial highlights for the periods presented, in conformity with accounting
principles generally accepted in the United States.
ARTHUR ANDERSEN LLP
Philadelphia, Pennsylvania
July 7, 2000
<PAGE>
NOTICE TO SHAREHOLDERS OF THE NEVIS FUND, INC. (UNAUDITED)
For the fiscal year ended May 31, 2000, the Nevis Fund, Inc. is designating the
following items with regard to the distribution paid during the year.
<TABLE>
<CAPTION>
LONG TERM (20% RATE) ORDINARY
CAPITAL GAINS INCOME
DISTRIBUTIONS DISTRIBUTION QUALIFYING
PORTFOLIO (TAX BASIS) (TAX BASIS) TOTAL DIVIDENDS (1)
---------- -------------------- ------------ -------- ------------
<S> <C> <C> <C> <C>
Nevis Fund, Inc. 0% 100% 100% 0%
</TABLE>
(1) Qualifying dividends represent dividends that qualify for the corporate
dividends received deduction.
<PAGE>
NOTES
<PAGE>
NOTES
<PAGE>
INVESTMENT ADVISER
Nevis Capital Management, Inc.
1119 St. Paul Street
Baltimore, MD 21202
ADMINISTRATOR
SEI Investments Mutual Funds Services
One Freedom Valley Drive
Oaks, PA 19456
DIRECTORS
Joseph Haridman
Bailey Morris-Eck
Charles Noell
Jon Baker
David Wilmerding, III
DISTRIBUTOR
SEI Investments Distribution Co.
One Freedom Valley Drive
Oaks, PA 19456
LEGAL COUNSEL
Morgan, Lewis & Bockius LLP
1701 Market Street
Philadelphia, PA 19103
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP
1601 Market Street
Philadelphia, PA 19103-2499
NEV-F-004-02
