<PAGE>
<PAGE>
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
- --------------------------------------------------------------------------------
Two Portland Square, Portland, Maine 04101
<TABLE>
<S> <C>
General Information (207) 879-8903
Account Information (800) 344-8332
Fund Literature (800) 290-9826
Fax (800) 879-6206
</TABLE>
INVESTMENT OBJECTIVE
Long-term capital appreciation primarily through investments in equity
securities of emerging markets. Securities are selected on the basis of
potential for capital appreciation without regard for current income.
INVESTMENT MANAGER
Schroder Capital Management International Inc. ('SCMI') is a wholly-owned
indirect subsidiary of Schroders plc, a publicly owned company organized under
the laws of England. Schroders plc is the holding company parent of a large
world-wide group of banks and financial services companies (the 'Schroder
Group') that dates its origins to 1804. The investment management subsidiaries
of the Schroder Group had, as of December 31, 1995, assets under management in
excess of $100 billion. As of that same date, SCMI, together with its U.K.
affiliate, Schroder Capital Management International Ltd., had over $17 billion
under management.
June 15, 1996
Dear Shareholder:
We are pleased to present the semi-annual report for the Schroder Emerging
Markets Fund Institutional Portfolio for the period ending April 30, 1996. Over
the half-year period, the net asset value of the Fund rose by 13.55% compared
with the Morgan Stanley Capital International (MSCI) Emerging Markets Free
(ex-Malaysia) Index return of 9.6%. Since the Funds launch on March 31, 1995, it
has appreciated by 19.9% compared with 18.7% of the unmanaged benchmark. Total
assets as of April 30, 1996 were $110 million.
After a difficult period for emerging market investing following the
Mexican crisis at the end of 1994, which lasted into late summer of 1995, the
six month period covered by this report saw renewed investor interest and higher
liquidity flows into nearly all emerging markets, resulting in some outstanding
returns, such as Poland (+32.5%), Argentina (+35.9%) and Indonesia (+27.8%).
This reflected the values apparent in these markets by late 1995 relative to
their long-term growth opportunity, especially in Eastern Europe where the
painful transition policies of the post Berlin Wall period have resulted in
robust economic conditions for this year and the foreseeable future.
The fact that no other Latin American country followed Mexico into crisis
(although clearly the banking sectors in a number of countries are under
considerable strain as a result of low inflation policies, resulting in rising
levels of bad debts) restored confidence in the region's governments. Over the
six month period, Mexico enjoyed restored international investor confidence,
resulting in a 28.9% return for the index.
In Asia, economic conditions have been too good, resulting in overheating
economies in Korea and Thailand. Tight domestic monetary policies have acted as
a depressant on these two markets. The big recovery story in Asia, however, has
been India -- the worst performing market in 1995 -- which recovered by 11.2%
over this reporting period.
Elections held throughout the developing world, India to the Czech
Republic, have tended to underscore management's view that the differences among
parties pertains to the pace of economic reform, rather than to reform programs
themselves. We remain encouraged that the path to prosperity of 60% of the
world's population lies in the realms of prudent monetary and fiscal policies,
appropriate exchange rates and open trading systems rather than populist
measures.
We are optimistic about the prospects for emerging market investments and
thank you for your interest in the Fund.
Sincerely,
<TABLE>
<S> <C>
/s/ HERMANN C. SCHWAB /s/ LAURA E. LUCKYN-MALONE
Hermann C. Schwab Laura E. Luckyn-Malone
Chairman President
</TABLE>
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
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PORTFOLIO STRATEGY
As of April 30, 1996, the Schroder Emerging Markets Fund Institutional
Portfolio was approximately 96.5% invested in equities and 3.5% in cash and
other assets. In recent months, there have been no major strategic shifts in
weightings. The Fund continues to be biased towards the Asian growth economies
with just over 55% invested in the region compared to only 36% in the Morgan
Stanley Capital International Emerging Markets Free (ex-Malaysia) Index. We
continue to believe that Asian markets offer superior value relative to
long-term growth rates. However, we can also find attractive stock investments
in Latin America, Europe and Africa. In the last six months, the Fund's net
asset value per share has risen 13.55%. Earnings growth generally remains
strong and valuations are attractive relative to the more mature industrialized
economies. We believe the Fund is ideally positioned to benefit from this
growth with a well positioned portfolio of quality companies.
The Fund continues to search for companies that will benefit from rising
living standards and increased infrastructure development with assistance from
our extensive network of analysts located in eleven emerging markets offices
around the world. We therefore believe we can identify inefficiently priced
securities across a broad capitalization range. In Asia, we look for strong
growth to continue for the remainder of 1996 and remain committed to countries
such as Thailand (which remains the Fund's largest weighting) due to its high
secular economic growth and the Philippines where we have added due to our
increased confidence in that country's sustainable growth. In Latin America,
signs of economic recovery should be more evident during the second half of
1996 as the measures taken by local governments begin to pay off leading to
both lower inflation and interest rates throughout the region.
We remain positive on Eastern Europe where valuations of selected stocks
remain low and earnings growth in construction and consumption related sectors
is expected to be strong. In South Africa, we have been adding to our
underweight position during the recent currency and market weakness. However,
while valuations have improved from their excessive levels of early in the year,
earnings expectations continue to be reduced as the economy slows down. Within
the market, we have been adding to companies that will benefit from the recent
Rand weakness, at the expense of domestic consumer stocks.
INVESTMENT REVIEW (AS OF APRIL 30, 1996)
LATIN AMERICA
The Latin American markets have performed well in the six months to April
30th, although political uncertainty and fluctuations in the 30-Year Treasury
have been the source of much volatility. However, improving economic conditions
in the region should bode well for future market performance.
The Brazilian stockmarket was up over the period with positive returns for
the current year after a poor end to 1995. The rejection of social security
reforms by Congress led to concerns over the Government's ability to push
through any political and fiscal changes. A watered down version of the reform
has since been passed and worries are now receding. Telebras and Multibras
continue to be two of the Fund's larger holdings and both posted strong returns
for the first quarter of 1996. Telebras registered consolidated earnings well
above market expectations and Multibras posted adjusted profits which were an
impressive 99% above the first quarter of 1995.
In Mexico, after the disappointing economic news of last year, 1996 has
witnessed a strengthening of the peso and falling interest rates, given the
Government's tough fiscal measures. These have improved investor confidence and
given a boost to the local market. Improved liquidity and good export figures,
especially to the U.S., have also contributed to positive performance figures.
Argentina began the period on an optimistic note as President Menem's
administration instituted a reform package that increased domestic confidence.
The government's continued attempts in March to boost the market through tax
cuts attracted investors as did the falling interest rates in the U.S.
AFRICA
Over the period, the South African market has been flat. However, this
disguises a continuation of the 1995 bull market up until early February
followed by nearly a 14% fall in the market in the last three months. This
dramatic change was due to the currency crisis that began in February caused by
political and economic concerns. After a year of stability and real currency
appreciation, the Rand has now fallen almost 20%. Over the last few months
there have been increasing signs of a slowdown in the domestic economy,
exacerbated by the recent currency problems, which have led to reduced
expectations for earnings growth.
- --------------------------------------------------------------------------------
2
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
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EASTERN EUROPE
November 1995 saw a former Communist, Aleksander Kwasniewski, elected
President of Poland. Kwasniewski's election left investors wondering as to the
direction of Polish economic policy. As the dust settled and his pro-reform
stance became apparent, the market began to stabilize. This long-awaited
political stability, accompanied by low valuations and strong company growth,
triggered significant international cash flows. Solid first quarter earnings
sustained the rally throughout April.
In Hungary, the market remained stagnant in the latter part of 1995
despite strong company fundamentals. The market jumped in the first quarter of
1996 as audited 1995 results for most companies exceeded expectations. In
addition, good news on the macro-level has pushed the market to record levels
as it appears Hungary will meet International Monetary Fund targets. The
normally quiet Czech market was rocked by further take-overs of mid-cap stocks.
The market began to stabilize in early January and, although it strengthened
considerably in the first quarter, was left behind by the roaring Polish and
Hungarian markets.
MEDITERRANEAN EUROPE
Political concerns have once again played a major role in Mediterranean
European markets in recent months. Turkey's election in late December 1995
placed downward pressure on stocks for the two months leading up to it.
Performance rebounded in February as the centrist-parties finally agreed
to form a coalition government. GDP growth prospects, along with improved
earnings, also played a part in boosting the market. Unfortunately, the
government was short-lived and the country is once again in the midst of
political uncertainty.
In the last quarter of 1995 investors, concerned about Prime Minister
Popandreou's illness, pushed the Greek market lower. The fact that there was no
real successor to the Prime Minister left investors concerned about future
economic policy. Although Prime Minister Simitis was named as replacement to
Popandreou, poor macro-economic news should keep the market from re-rating
substantially. November elections in Portugal resulted in a Socialist victory.
The market benefited from some initial enthusiasm. Unfortunately, concerns
about government policy and the flood of employee stock from previous
privatizations limited upside potential.
ASIA
The Thai stock market has continued to be held back by tight monetary
policies. Despite clear signs of the economy slowing down, the Bank of Thailand
indicated, in a meeting with your Fund's management, that interest rates are
unlikely to fall until the second half of the year. This, combined with
disappointing 1995 corporate results from the banking sector, has kept
investors away from the market. The good performance in the Philippines can be
attributed to the extremely strong corporate results released in the first
quarter of 1996. A recent visit to the Philippines by your Fund's management
was very positive. With the economy still transitioning to a higher growth
phase, we are optimistic for the stock market's prospects. Indonesia was the
Fund's strongest performer in Asia over the last six months, up 28% in U.S.
dollar terms. This was due to robust corporate earnings and the perception that
interest rates would peak early in the year.
The Indian stockmarket has been driven upwards by strong foreign investment
flows, particularly over the last 3 months. This was despite the
government's tight monetary policy, a weaker rupee and market selling pressure
from the Unit Trust of India. Local participation has been subdued due to the
general election currently underway. The combination of a stabilizing economy
and cheap valuations, supported by strong corporate profits growth, provided an
attractive background for investment.
Korea has been one of the weakest regional markets over the last six
months. The slush fund scandal, implicating former President Roh and several
heads of chaebol, dampened investor confidence at the beginning of the period.
This was countered by the raising of foreign investment limitations to 18% at
the beginning of April which boosted the market, dramatically increasing
liquidity. Interest rates are also falling as the Korean economy strengthens
and local investors switch from bonds to equities providing the market with
strong support. Given attractive valuation levels, the Fund's weighting in
Korea is being raised.
The views expressed in this report were those of the Fund's portfolio
managers as of the dates specified, and may not reflect the views of the
portfolio managers on the date this report is first published or at any time
thereafter. These views are intended to assist shareholders of the Funds in
understanding their investments in the Funds and do not constitute investment
advice; investors should consult their own investment professionals as to their
individual investment programs.
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3
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
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FUND CHARACTERISTICS AS OF APRIL 30, 1996
<TABLE>
<CAPTION>
INVESTMENT BY INDUSTRY
INDUSTRY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Capital Equipment 12.0%
Consumer Goods 5.4%
Energy 15.5%
Financial 24.5%
Materials 9.4%
Multi-Industry 7.3%
Services 22.3%
Cash and Other Net Assets 3.6%
---------------
Total 100.0%
---------------
---------------
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
SECURITY % OF PORTFOLIO
- --------------------------------------------------------
<S> <C>
Krung Thai Bank 2.5%
Korea Electric Power Corp. 2.4%
Shinhan Bank 2.3%
United Communications 2.1%
Korea Mobile Telecommunications 2.1%
Metropolitan Bank & Trust 2.0%
Bangkok Bank Co. Ltd. 2.0%
The Morgan Stanley India Fund 1.9%
Tata Electric Co. 1.8%
Electricity Generating Public Co. 1.8%
---------------
Total 20.9%
---------------
---------------
</TABLE>
COUNTRY WEIGHTINGS
<TABLE>
<CAPTION>
COUNTRY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Thailand 14.1%
South Korea 11.1%
Brazil 10.5%
Philippines 9.4%
India 8.6%
Indonesia 8.0%
Mexico 7.4%
Argentina 4.6%
South Africa 4.3%
Chile 3.2%
<CAPTION>
COUNTRY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Poland 2.8%
Turkey 2.4%
Portugal 2.2%
China 2.0%
Hong Kong 1.9%
Greece 1.2%
Czech Republic 1.1%
Hungary 0.9%
Slovak Republic 0.7%
Cash 3.6%
---------------
Total 100.0%
---------------
---------------
</TABLE>
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4
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<PAGE>
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1996
<TABLE>
<S> <C>
ASSETS:
Investments in Schroder Emerging Markets Fund
Institutional Portfolio (Portfolio) (cost $100,379,775) $110,679,404
Organization costs, net of amortization 23,533
------------
Total Assets 110,702,937
------------
LIABILITIES:
Accrued administration fees (Note 3) 23,194
Other payables and accrued expenses 54,697
------------
Total Liabilities 77,891
------------
Net Assets $110,625,046
------------
------------
NET ASSETS CONSIST OF:
Paid-in capital 101,098,836
Undistributed net investment income 381,773
Accumulated loss on investments and foreign currency
transactions (1,155,192)
Net unrealized appreciation of investments and foreign
currency transactions 10,299,629
------------
Net Assets $110,625,046
------------
------------
Net Asset Value price per share
($110,625,046 divided by
9,180,087 shares outstanding) $12.05
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
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5
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<PAGE>
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1996
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $284,770) $ 887,337
Interest 190,500
----------
Total Income 1,077,837
----------
EXPENSES:
Investment advisory fees (Note 3) 389,662
Administration fees (Note 3) 97,518
Transfer agent fees and expenses (Note 3) 12,632
Custodian fees 102,378
Accounting service fees (Note 3) 36,000
Auditing fees 7,548
Other professional fees 7,497
Trustees fees and expenses 5,966
Other 59,668
Amortization of organization costs 4,237
----------
Total Expenses 723,106
Expenses reimbursed and fees waived (Note 3) (98,315)
----------
Net Expenses 624,791
----------
NET INVESTMENT INCOME 453,046
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized loss on investments (857,675)
Net realized loss on foreign currency transactions (137,984)
Change in unrealized appreciation of investments 9,230,726
Change in unrealized depreciaiton of foreign currency
transactions (1,292)
----------
NET GAIN ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS 8,233,775
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $8,686,821
----------
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
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6
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<PAGE>
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For The Six Months For The Period
Ended Ended
April 30, 1996 October 31, 1995
------------------ ----------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment income $ 453,046 $ 49,989
Net realized loss on investments and
foreign currency transactions (995,659) (178,203)
Change in unrealized appreciation of
investments and foreign currency
transactions 9,229,434 1,070,195
------------------ ----------------
Net increase in net assets resulting from
operations 8,686,821 941,981
------------------ ----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM NET INVESTMENT
INCOME (102,592) --
INCREASE FROM CAPITAL SHARE TRANSACTIONS (NOTE 5) 83,617,561 17,481,275
------------------ ----------------
INCREASE IN NET ASSETS 92,201,790 18,423,256
NET ASSETS:
Beginning of period 18,423,256 --
------------------ ----------------
End of period $110,625,046 $ 18,423,256
------------------ ----------------
------------------ ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
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7
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION:
Schroder Emerging Markets Fund Institutional Portfolio (the 'Fund'),
which commenced operations on March 31, 1995, is a separately managed,
non-diversified portfolio of Schroder Capital Funds (Delaware) (the 'Trust'),
a registered open-end management investment company. The Fund currently seeks
to achieve its investment objective by holding, as its only investment
security, an interest in Schroder Emerging Markets Fund Institutional
Portfolio (the 'Portfolio'), a separate portfolio of a registered open-end
management investment company having the same investment objective and
policies as the Fund. The Funds's investment in the Portfolio is in the form
of a non-transferable beneficial interest. As of the date of this report, the
Fund is the only institutional investor in the Portfolio. The Portfolio may
permit other investment companies or institutional investors to invest in it.
All investors will invest on the same terms and conditions as the Fund and
will pay a proportionate share of the Portfolio's expenses.
2. SIGNIFICANT ACCOUNTING POLICIES:
The Fund's financial statements are prepared in accordance with
generally accepted accounting principles which permit management to make
certain estimates and assumptions at the date of the financial statements and
are based on the significant accounting policies which follow. The Fund has a
fundamental investment policy that allows it to invest all of its investment
assets in the Portfolio. All other investment policies of the Fund and the
Portfolio are substantially the same. The policies and financial statements
of the Portfolio are presented in a subsequent section of this report.
A. Portfolio securities listed on the recognized stock exchanges
are valued at the last reported trade price on the exchange on which the
securities are principally traded. Listed securities traded on recognized
stock exchanges where last trade prices are not available are valued at
mid-market prices. Securities traded in over-the-counter markets, or
listed securities for which no trade is reported on the valuation date,
are valued at the most recent reported price. Other securities and assets
for which market quotations are not readily available, are valued at fair
value as determined in good faith using methods approved by the Board of
Trustees.
B. The Fund intends to continue to comply with the provisions of
Subchapter M of the Internal Revenue Code of 1986, as amended (the
'Code'), applicable to regulated investment companies. As a regulated
investment company, the Fund intends to distribute substantially all of
its net investment income and its net realized long term capital gains at
least annually and therefore intends not to be subject to Federal income
tax to the extent it distributes such income and capital gains in the
manner required under the Code.
C. The Portfolio is treated as a partnership for Federal income tax
purposes. All interest, dividends, gains and losses of the Portfolio are
deemed to have been 'passed through' to the Fund in proportion to its
holdings of the Portfolio, regardless of whether such interest, dividends
or gains have been distributed by the Portfolio. Investment transactions
are accounted for by the Portfolio on the trade date. Dividend income is
recorded by the Portfolio on the ex-dividend date. Interest income,
including amortization of discount or premium, is recorded by the
Portfolio as earned. Identified cost of investments sold is used to
determine gains and losses for both financial statement and Federal
income tax purposes. Foreign dividend and interest income amounts and
realized capital gains and losses are converted to U.S. dollar
equivalents by the Portfolio using foreign exchange rates in effect at
the date of the transactions.
D. Foreign currency amounts are translated into U.S. dollars at the
mean of the bid and asked prices of such currencies against U.S. dollars
as follows: assets and liabilities at the rate of exchange at the end of
the respective period, purchases and sales of securities and income and
expenses at the rate of exchange prevailing on the dates of such
transactions. It is not practical to isolate that portion of the results
of operations arising from changes in the exchange rates from the portion
arising from changes in the market prices of securities.
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8
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
E. The Portfolio may enter into forward contracts to purchase or
sell foreign currencies to protect against the effect on the U.S. dollar
value of the underlying portfolio of possible adverse movements in
foreign exchange rates. Risks associated with such contracts include the
movement in value of the foreign currency relative to the U.S. dollar and
the ability of the counterparty to perform. Fluctuations in the value of
such contracts are recorded as unrealized gains or losses; realized gains
or losses include net gains or losses on contracts which have terminated
by settlement or by the Portfolio entering into offsetting commitments.
F. Distributions to shareholders are recorded on the ex-dividend
date. Income and capital gain distributions are determined in accordance
with Federal income tax regulations which may differ from generally
accepted accounting principles. Permanent book and tax basis differences
relating to shareholder distributions will result in reclassifications to
paid in capital and may affect the per share allocation between net
investment income and realized and unrealized gain or loss. Undistributed
net investment income and accumulated undistributed net realized gains or
losses may include temporary book and tax basis differences which will
reverse in a subsequent period. Any taxable income or gain remaining at
fiscal year end is distributed in the following year.
3. RELATED PARTIES:
For the six months ended April 30, 1996, remunerations to related
parties were paid or accrued in the following amounts:
<TABLE>
<CAPTION>
Earned Waived Net
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Schroder Capital Management International, Inc.
(Investment Adviser) $389,662 $78,652 $311,010
Schroder Fund Advisors Inc.
(Administrator and Distributor) 97,518 19,663 77,855
Forum Financial Corp.
(Fund Accountant and Transfer Agent) 48,632 -- 48,632
-------- ------- --------
$535,812 $98,315 $437,497
-------- ------- --------
-------- ------- --------
</TABLE>
The Fund currently invests all of its assets in the Portfolio which
retains Schroder Capital Management International, Inc. ('SCMI') to act as
investment adviser pursuant to an Investment Advisory Contract. SCMI manages
the investment and reinvestment of the assets included in the Portfolio and
continuously reviews, supervises and administers the Portfolio's investments.
It is the responsibility of SCMI to make decisions relating to the
Portfolio's investments and to place purchase and sale orders regarding such
investments with brokers or dealers selected at its discretion. For its
services as Investment Adviser to the Portfolio, SCMI receives a monthly fee
equal on an annual basis to 1.00% of the average daily net assets of the
Portfolio.
The Fund may, at any time, withdraw it's investment from the Portfolio
if the Board of Trustees determines that it is in the best interests of the
Fund and its shareholders to do so. Accordingly, the Fund has retained SCMI
as its investment adviser to manage the Fund's assets in the event the Fund
so withdraws its investment. SCMI will not receive an investment advisory fee
with respect to the Fund so long as the Fund remains completely invested in
the Portfolio or any other investment company.
On behalf of the Fund , the Trust has entered into an Administrative
Services Contract with Schroder Fund Advisors Inc. ('Schroder Advisors'). In
addition, the Trust and Schroder Advisors have entered into a
Sub-Administration Agreement with Forum Financial Services ('Forum').
Pursuant to their agreements, Schroder Advisors and Forum provide certain
management and administrative services necessary to the Fund's
- --------------------------------------------------------------------------------
9
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
operations other than the investment management and administrative services
provided to the Fund by SCMI pursuant to the Investment Advisory Contract.
For these services, Schroder Advisors receives from the Fund, a fee payable
monthly at an annual rate of 0.10% of the average daily net assets of the
Fund. Payment for Forum's services is made by Schroder Advisors and is not a
separate expense of the Fund. Schroder Advisors and Forum provide similar
services to the Portfolio, for which Schroder Advisors is separately
compensated at an annual rate of 0.15% of the average daily net assets of the
Portfolio, a portion of which Forum receives for its services with respect to
the Portfolio.
Forum Financial Corp. ('FFC') , an affiliate of Forum, performs
portfolio accounting services for the Fund pursuant to a Fund Accounting
Agreement with the Trust. Under its agreement, FFC prepares and maintains
books and records of the Fund on behalf of the Trust that are required to be
maintained under the Investment Company Act of 1940, calculates the net asset
value per share of the Fund, calculates dividend and capital gain
distributions and prepares periodic reports to the shareholders and the
Securities and Exchange Commission. For its services, FFC receives from the
Trust, with respect to the Fund, a fee of $12,000 per year plus, for each
class of the Fund above one, an additional $12,000 per year.
FFC is also the Fund's transfer agent and dividend disbursing agent and
is compensated for those services by the Fund in the amount of $12,000 per
year, plus certain shareholder account fees.
The Fund bears all costs of its operations other than those
specifically assumed by SCMI or Schroder Advisors. Expenses directly
attributable to a fund within the Trust, are charged to that fund. Other
expenses are allocated proportionately among the funds in relation to the net
assets of each fund.
4. CAPITAL SHARES:
The Fund is authorized under the Trust's Trust Instrument to issue an
unlimited number of shares
of beneficial interest without par value. At April 30, 1996 the Fund had
9,180,087 shares outstanding. Transactions in the Fund's capital shares for
the six months ended April 30, 1996 and the period ended October 31, 1995
were as follows:
<TABLE>
<CAPTION>
Six Months Ended April Period Ended October 31,
30, 1996 1995
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Number of Number of
Shares Amount Shares Amount
- ------------------------------------------------------------------------------------------------------
Shares sold 7,443,648 $83,584,132 1,733,324 $17,481,275
Shares issued for reinvestment of dividends 3,115 33,429 -- --
--------- ----------- --------- -----------
7,446,763 $83,617,561 1,733,324 $17,481,275
--------- ----------- --------- -----------
--------- ----------- --------- -----------
</TABLE>
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10
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SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
5. FINANCIAL HIGHLIGHTS:
For a share outstanding throughout the period:
<TABLE>
<CAPTION>
Six Months March 31, 1995*
Ended through
April 30, 1996 October 31, 1995
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net Asset Value, beginning of period $10.63 $10.00
-------------- --------
Investment operations:
Net investment income .06 0.02
Net realized and unrealized gain on investments 1.38 0.61
-------------- --------
Total from investment operations 1.44 0.63
Distributions to shareholders from net investment income (.02) --
-------------- --------
Net Asset Value, end of period $12.05 $10.63
-------------- --------
-------------- --------
Total return 13.55% 6.30%
Ratios/supplementary data:
Net assets, end of period (thousands) $110,625 $18,423
Ratio of expenses to average net assets(b) 1.60%(a) 1.58%(a)
Ratio of net investment income to average net assets 1.16%(a) 0.46%(a)
Portfolio turnover(c) -- 44.10%
* Commencement of operations.
(a) Annualized.
(b) During the period, various fees and expenses were waived and reimbursed,
respectively. Had such waiver and reimbursement not occurred, the ratio
of expenses to average net assets would have been: 1.85%(a) 2.45%(a)
</TABLE>
(c) Now calculated at the Portfolio level.
6. SUBSEQUENT EVENT:
Effective May 17, 1996 the Fund began offering two classes of shares;
Investor Shares and Advisor Shares. Investor Shares are offered for sale at
net asset value as an investment vehicle for individuals, institutions,
corporations and fiduciaries. Advisor Shares are offered for sale at net
asset value to individual investors primarily through banks, trust companies,
broker-dealers or other financial organizations and incur higher expenses
than Investor Shares. On May 17, 1996 all existing shares of the Fund were
converted to Investor Shares.
- --------------------------------------------------------------------------------
11
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1996
<TABLE>
<CAPTION>
SHARES VALUE US$
------ ---------
<C> <S> <C>
ARGENTINA - 4.7%
COMMON STOCK
95,800 Banco Frances del Rin de la
Plata SA
Banks 923,466
26,700 Buenos Aires Embotelladora,
SA
Beverage Manufacturers 423,863
104,000 CIADEA SA*
Automobiles 603,594
305,570 Perez Companc SA
Oil Exploration & Production 1,920,743
23,810 Quilmes Industrial SA*
Beverage Manufacturers 282,744
304,000 Telefonica de Argentina, SA
Utilities 897,439
-----------
5,051,849
-----------
BRAZIL - 10.9%
COMMON STOCK
478,000 Centrais Eletricas
Brasileiras SA-Eletrobras
Electricity & Gas 114,658
6,400,000 Companhia Paulista de Forca e
Luz-CPFL*
Electricity & Gas 412,820
12,619,000 Telecomunicacoes Brasileiras
SA-Telebras
Telecommunications 534,165
22,000 Telecomunicacoes Brasileiras
SA-Telebras ADR
Telecommunications 1,190,751
-----------
2,252,394
-----------
PREFERRED STOCK
30,000,000 Banco Brasileiro De Decontos
SA
Banks 335,618
19,000,000 Banco Nacional SA*
Banks --
7,991,000 Centrais Eletricas
Brasileiras SA-Eletrobras
Electricity & Gas 1,973,185
38,154,942 Cia Acos Espec Itabir
Construction/Building
Materials 161,509
566,250 IKPC-Industrias Klabin de
Papel e Celulose SA
Forestry, Paper Products 553,581
1,915,000 Itausa Investimentos Itau SA
Diversified Holding Company 1,331,737
1,368,055 Multibras Eletrodomesticos SA
Household
Durables/Appliances 1,433,962
8,600,000 Petrol Brasileiro-Petrobras
Oil/Gas 996,775
5,412,000 Telecomunicacoes de Sao Paulo
SA-TELESP
Telecommunications 960,545
BRAZIL (CONCLUDED)
1,864,000 Telecomunicacoes do Parana
SA-Telepar
Telecommunications 695,102
13,800,000 Unibanco-Uniao de Bancos
Brasileiro
Banks 579,985
362,000,000 Usinas Siderurgicas de Minas
Gerais SA-Usiminas
Engineering 401,330
-----------
9,423,329
-----------
11,675,723
-----------
CHILE - 3.3%
COMMON STOCK
29,000 Banco Osorno y La Union
Banks 438,625
12,500 Compania de
Telecomunicaciones de Chile
SA
Utilities/Telecommunications 1,140,625
12,000 Embotelladora Andina SA
Beverage Manufacturers 420,000
11,300 Quimica y Minera Chile SA
ADR*
Chemicals 604,550
33,700 Santa Isabel SA*
Retailers, Food 973,088
-----------
3,576,888
-----------
CHINA, PEOPLES REPUBLIC OF - 2.1%
COMMON STOCK
121,000 Huaneng Power International,
Inc.*
Utilities 1,890,625
570,000 Shanghai Shangling Electric
Appliances Company Ltd
Electrical Appliances 369,360
-----------
2,259,985
-----------
CZECH REPUBLIC - 1.1%
COMMON STOCK
5,200 SPT Telekom as*
Telecommunications 636,108
2,552 Tabak as*
Tobbaco Manufacturers 559,174
-----------
1,195,282
-----------
GREECE - 1.3%
COMMON STOCK
11,133 Alfa Credit Bank
Banks 556,646
21,750 Hellenic Bottling Company SA
Beverage Manufacturers 780,284
-----------
1,336,930
-----------
</TABLE>
- --------------------------------------------------------------------------------
12
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
APRIL 30, 1996
<TABLE>
<CAPTION>
SHARES VALUE US$
------ ---------
<C> <S> <C>
HONG KONG - 2.0%
COMMON STOCK
2,040,000 Guangdong Electric Power
Development Company Ltd*
Utilities/Electricity 1,120,850
1,620,000 Guangdong Investments
Diversified Holding Company 1,000,038
-----------
2,120,888
-----------
HUNGARY - 1.0%
COMMON STOCK
19,900 Gedeon Richter Rt Austrian
Certificates*
Pharmaceuticals 691,696
9,700 Gedeon Richter Rt*
Pharmaceuticals 341,925
-----------
1,033,621
-----------
INDIA - 8.9%
COMMON STOCK
32,000 BSES Ltd*
Utilities/Electricity 646,080
95,000 Gujarat Ambuja Cements
Construction & Building
Materials 1,163,750
31,000 Indian Hotels Company Ltd GDR*
Leisure & Hotels 906,595
16,000 Ranbaxy Laboratories Ltd*
Pharmaceuticals 380,000
4,000 Tata Electric Company
Electricity & Gas 2,030,000
28,400 Tata Engineering and Locomotive
Company Ltd
Engineering, Vehicles 511,200
160,000 The India Fund Inc*
Other Financial 1,780,001
170,000 The Morgan Stanley India
Investment Fund*
Other Financial 2,061,250
-----------
9,478,876
-----------
INDONESIA - 8.2%
COMMON STOCK
210,000 PT Bank Internasional Indonesia
Banks 1,034,483
170,000 PT Dankos Laboratories
Pharmaceuticals 415,982
152,000 PT Gudang Garam
Tobacco Manufacturers 1,092,974
190,000 PT Hero Supermarkets
Food/Grocery Products 220,226
174,000 PT Indocement Tunggal Prakarsa
Multi-Industry 672,270
193,000 PT Indofoods Sukses Makmur*
Food/Grocery Products 888,600
INDONESIA (CONCLUDED)
41,000 PT Indosat
Telecommunications 1,429,875
540,500 PT Mulia Industrindo
Construction/Building
Materials 1,044,142
290,000 PT Semen Gresik
Construction/Building
Materials 1,005,292
600,000 PT Telekomunikasi Indonesia*
Telecommunications 998,102
-----------
8,801,946
-----------
KOREA, REPUBLIC OF - 11.6%
COMMON STOCK
32,000 Hyundai Motor Company Ltd
Automobiles 504,000
57,000 Korea Electric Power
Corporation
Electricity & Gas 2,602,495
40,000 Korea Mobile
Telecommunications*
Telecommunications 2,277,600
5,000 L.G. Chemical Ltd
Chemicals 102,233
10,000 L.G. Information and
Communication Ltd
Telecommunications 1,407,050
9,000 Pohang Iron & Steel Company Ltd
Iron & Steel 824,570
11,554 Samsung Electronics Company
Electrical Equipment 1,573,742
3,482 Samsung Electronics Company 1st
New*
Electrical Equipment 463,089
107,000 Shinhan Bank
Banks 2,577,709
-----------
12,332,488
-----------
MEXICO - 7.6%
COMMON STOCK
115,000 ALFA SA de CV
Retailers, General 1,673,888
55,100 Bufete Industrial, SA*
Engineering 933,945
450,120 Cemex SA de CV
Construction/Building
Materials 1,784,369
159,000 Sanluis Corporacion SA de CV
Automobiles 930,000
97,000 Grupo Carso SA de CV*
Diversified Holding Company 741,729
266,000 Industrias Penoles
Mining-Metals/Minerals 1,150,827
51,500 Kimberly-Clark de Mexico SA de
CV
Forestry, Paper Products 937,532
-----------
8,152,290
-----------
</TABLE>
- --------------------------------------------------------------------------------
13
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
APRIL 30, 1996
<TABLE>
<CAPTION>
SHARES VALUE US$
------ ---------
<C> <S> <C>
PHILIPPINES - 9.8%
COMMON STOCK
1,131,250 Ayala Land Incorporated 'B'
Shares
Real Estate 1,751,423
855,000 C & P Homes Inc
Construction/Building
Materials 735,404
1,200,000 Fil-Estate Land Inc
Real Estate 1,261,512
82,500 Manila Electric Company 'B'
Shares
Electricity & Gas 769,522
83,000 Metropolitan Bank & Trust
Company
Banks 2,236,888
14,000 Philippine Long Distance
Telephone Company
Telecommunications 711,798
178,573 Philippine Savings Bank*
Banks 436,891
980,000 Pilipino Telephone Corporation*
Telecommunications 1,442,328
1,422,400 SM Prime Holdings*
Real Estate 413,250
4,610,000 Southeast Asia Cement Holdings,
Inc*
Construction/Building
Materials 678,483
-----------
10,437,499
-----------
POLAND - 2.9%
COMMON STOCK
7,000 Bydgoska Fabryka Kabli SA*
Electrical Equipment 194,488
12,700 Gorazdze SA*
Construction/Building
Materials 407,694
38,250 Krosno SA
Miscellaneous Manufacturing 682,165
14,041 Zaklady Metali Lekkich Kety*
Metals-Diversified 975,289
10,600 Zaklady Piwowarskie w Zywcu SA
(Zywiec)
Beverage Manufacturers 875,572
-----------
3,135,208
-----------
PORTUGAL - 2.3%
COMMON STOCK
43,100 Banco Espirito Santo e
Comercial de Lisboa*
Banks 660,506
14,000 Estabelecimentos Jeronimo
Martins & Filho
Retailers, Food 1,123,066
58,100 Semapa-Sociedade de
Investimento e Gestao, SGPS,
SA*
Construction/Building
Materials 624,633
-----------
2,408,205
-----------
SLOVAKIA - 0.7%
COMMON STOCK
9,076 Nafta Gbely AS*
Oil 735,336
-----------
SOUTH AFRICA - 4.4%
COMMON STOCK
65,000 Barlow Ltd
Diversified Holding Company 748,155
267,000 Energy Africa Ltd*
Oil/Gas 648,613
147,093 Malbak Ltd
Diversified Holding Company 706,147
175,000 Nampak Ltd
Forestry, Paper Products 736,876
135,000 Sentrachem Ltd
Chemicals 521,597
27,300 South African Breweries Ltd
Beverage Manufacturers 789,510
219,000 Waltons Stationary Company Ltd
Computers/Communications/Office
Equipment 557,342
-----------
4,708,240
-----------
THAILAND - 14.7%
COMMON STOCK
152,000 Bangkok Bank Public Company Ltd
Banks 2,203,326
247,000 Bank of Ayudhya Public Company
Ltd
Banks 1,457,596
516,000 Electricity Generating Public
Company Ltd
Electricity & Gas 2,023,200
562,000 Krung Thai Bank Public Company
Ltd
Banks 2,760,019
106,000 Land & House Public Company Ltd
Real Estate 1,637,286
34,000 Siam Cement Public Company Ltd
Construction/Building
Materials 1,750,558
377,000 Siam City Bank Public Company
Ltd
Banks 451,670
94,000 Thai Farmers Bank Public
Company Ltd
Banks 1,079,643
167,000 United Communication Industry
Telecommunications 2,288,478
-----------
15,651,776
-----------
</TABLE>
- --------------------------------------------------------------------------------
14
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
APRIL 30, 1996
<TABLE>
<CAPTION>
SHARES VALUE US$
------ ---------
<C> <S> <C>
TURKEY - 2.5%
COMMON STOCK
3,102,800 Adana Cimento Sanayii
Construction/Building
Materials 525,950
909,200 Migros Turk TAS
Retail/Grocery 1,039,536
2,137,000 Netas-Northern Elektrik
Telekomunikasyon AS
Telecommunications 554,012
TURKEY (CONCLUDED)
4,638,332 Turk Demir Dokum Fabrikalari
AS
Miscellaneous Manufacturing 524,158
-----------
2,643,656
-----------
Total Investments 100.0%
(cost $97,505,960) 106,736,686
-----------
-----------
</TABLE>
* Non-income producing security
- --------------------------------------------------------------------------------
15
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1996
<TABLE>
<S> <C>
ASSETS:
Investments, at value (at cost, $97,505,960)
(Notes 2A and 3) $106,736,686
Cash 4,048,210
Receivable for securities sold 113,834
Receivable for dividends, tax reclaims and interest 622,749
Organization costs, net of amortization 11,130
------------
Total Assets 111,532,609
------------
LIABILITIES:
Payable for securities purchased 720,788
Accrued advisory fees (Note 4) 38,489
Other payables and accrued expenses 93,928
------------
Total Liabilities 853,205
------------
Net Assets $110,679,404
------------
------------
NET ASSETS CONSIST OF:
Investors' capital 101,449,970
Net unrealized appreciation of investments and foreign
currency transactions 9,229,434
------------
Net Assets $110,679,404
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
16
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1996
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $284,770) $ 887,337
Interest 190,500
----------
Total Income 1,077,837
----------
EXPENSES:
Investment advisory fees (Note 4) 389,662
Administration fees (Note 4) 58,449
Transfer agent fees and expenses (Note 4) 6,016
Custodian fees 102,378
Accounting service fees (Note 4) 30,000
Other professional fees 2,594
Trustees fees and expenses 3,603
Other 12,130
Amortization of organization costs 1,237
----------
Total Expenses 606,069
Expenses reimbursed and fees waived (Note 4) (98,315)
----------
Net Expenses 507,754
----------
NET INVESTMENT INCOME 570,083
----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized loss on investments (857,675)
Net realized loss on foreign currency transactions (137,984)
Change in unrealized appreciation of investments 9,230,726
Change in unrealized depreciation of foreign currency
transactions (1,292)
----------
NET GAIN ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS 8,233,775
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $8,803,858
----------
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
17
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED APRIL 30, 1996
<TABLE>
<S> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment income $ 570,083
Net realized loss on investments and foreign currency
transactions (995,659)
Change in unrealized appreciation of investments and foreign
currency transactions 9,229,434
------------
Net increase in net assets resulting from operations 8,803,858
------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTERESTS:
Contributions 102,020,306
Withdrawals (144,760)
------------
101,875,546
------------
INCREASE IN NET ASSETS 110,679,404
NET ASSETS:
Beginning of period --
------------
End of period $110,679,404
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
18
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION:
Schroder Emerging Markets Fund Institutional Portfolio (the
'Portfolio') is a separately managed, non-diversified portfolio of Schroder
Capital Funds, a registered open-end management investment company. The
Portfolio invests in securities of issuers domiciled or doing business in
emerging market countries in regions such as Southeast Asia, Latin America,
and Eastern and Southern Europe, which may subject it to risks not normally
associated with investing in securities of United States corporations.
2. SIGNIFICANT ACCOUNTING POLICIES:
The Portfolio's financial statements are prepared in accordance with
generally accepted accounting principles which permit management to make
certain estimates and assumptions at the date of the financial statements and
are based on the following significant accounting policies:
A. Portfolio securities listed on the recognized stock exchanges
are valued at the last reported trade price on the exchange on which the
securities are principally traded. Listed securities traded on recognized
stock exchanges where last trade prices are not available are valued at
mid-market prices. Securities traded in over-the-counter markets, or
listed securities for which no trade is reported on the valuation date,
are valued at the most recent reported price. Other securities and assets
for which market quotations are not readily available, are valued at fair
value as determined in good faith using methods approved by the Board of
Trustees.
B. The Portfolio is not required to pay Federal income taxes on its
net investment income and capital gain, as it is treated as a partnership
for Federal income tax purposes. All interest, dividends, gains and
losses of the Portfolio are deemed to have been 'passed through' to the
partners in proportion to their holdings of the Portfolio, regardless of
whether such interest, dividends or gains have been distributed by the
Portfolio.
C. Investment transactions are accounted for on the trade date.
Dividend income is recorded on the ex-dividend date. Interest income,
including amortization of discount or premium, is recorded as earned.
Identified cost of investments sold is used to determine gains and losses
for both financial statement and Federal income tax purposes. Foreign
dividend and interest income amounts and realized capital gains and
losses are converted to U.S. dollar equivalents using foreign exchange
rates in effect at the date of the transactions.
D. Foreign currency amounts are translated into U.S. dollars at the
mean of the bid and asked prices of such currencies against U.S. dollars
as follows: assets and liabilities at the rate of exchange at the end of
the respective period; purchases and sales of securities and income and
expenses at the rate of exchange prevailing on the dates of such
transactions. It is not practical to isolate that portion of the results
of operations arising from changes in the exchange rates from the portion
arising from changes in the market prices of securities.
E. The Portfolio may enter into forward contracts to purchase or
sell foreign currencies to protect against the effect on the U.S. dollar
value of the underlying portfolio of possible adverse movements in
foreign exchange rates. Risks associated with such contracts include the
movement in value of the foreign currency relative to the U.S. dollar and
the ability of the counterparty to perform. Fluctuations in the value of
such contracts are recorded as unrealized gains or losses; realized gains
or losses include net gains or losses on contracts which have terminated
by settlement or by the Portfolio entering into offsetting commitments.
- --------------------------------------------------------------------------------
19
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. PURCHASES AND SALES OF SECURITIES:
The cost of securities purchased and the proceeds from sales of
securities or maturities for the six months ended April 30, 1996 aggregated
$92,523,723 and $11,724,157 respectively.
For Federal income tax purposes, the tax basis of investment securities
owned at April 30, 1996 was $97,505,960. The aggregate gross unrealized
appreciation for all securities in which there was an excess of market value
over tax cost was $13,099,604 and aggregate gross unrealized depreciation for
all securities in which there was an excess of tax cost over market value was
$3,868,878.
4. RELATED PARTIES:
For the six months ended April 30, 1996, remunerations to related
parties were paid or accrued in the following amounts:
<TABLE>
<CAPTION>
Earned Waived Net
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Schroder Capital Management International, Inc.
(Investment Adviser) $389,662 $78,652 $311,010
Schroder Fund Advisors Inc.
(Administrator and Distributor) 58,449 19,663 38,786
Forum Financial Corp.
(Fund Accountant and Transfer Agent) 36,016 -- 36,016
-------- ------- --------
$484,127 $98,315 $385,812
-------- ------- --------
-------- ------- --------
</TABLE>
The Portfolio retains Schroder Capital Management International, Inc.
('SCMI') to act as investment adviser pursuant to an Investment Advisory
Contract. SCMI manages the investment and reinvestment of the assets included
in the Portfolio and continuously reviews, supervises and administers the
Portfolio's investments. It is the responsibility of SCMI to make decisions
relating to the Portfolio's investments and to place purchase and sale orders
regarding such investments with brokers or dealers selected at its
discretion. For its services as Investment Adviser to the Portfolio, SCMI
receives a monthly fee equal on an annual basis to 1.00% of the average daily
net assets of the Portfolio.
The Portfolio has entered into an Administrative Services Contract with
Schroder Fund Advisors Inc. ('Schroder Advisors'). In addition, the Portfolio
and Schroder Advisors have entered into a Sub-Administration Agreement with
Forum Financial Services ('Forum'). Pursuant to their agreements, Schroder
Advisors and Forum provide certain management and administrative services
necessary to the Portfolio's operations other than the investment management
and administrative services provided to the Portfolio by SCMI pursuant to the
Investment Advisory Contract. Schroder Advisors is compensated for these
services at an annual rate of 0.15% of the average daily net assets of the
Portfolio, a portion of which Forum receives for its services with respect to
the Portfolio.
Forum Financial Corp. ('FFC') , an affiliate of Forum, performs
portfolio accounting services for the Portfolio pursuant to a Fund Accounting
Agreement with Schroder Capital Funds. For its services, FFC receives a fee
of $60,000 per year.
FFC is also the Portfolio's transfer agent and dividend disbursing
agent pursuant to a Transfer Agency Agreement between Schroder Capital Funds
and FFC. FFC is compensated for those services in the amount of $12,000 per
year, plus certain shareholder account fees.
- --------------------------------------------------------------------------------
20
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKETS FUND INSTITUTIONAL PORTFOLIO (PORTFOLIO)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
5. FINANCIAL HIGHLIGHTS:
Portfolio performance for the six months ended April 30, 1996.
<TABLE>
<S> <C>
Ratio of expenses to average net assets .30%1(a)(b)
Ratio of net investment income to average net assets .146%(a)
Portfolio turnover 15.10%
Average commission per share $.001
(a) Annualized.
(b) During the period, various fees and expenses were waived and reimbursed,
respectively. Had such waiver and reimbursement not occurred, the ratio
of expenses to average net assets would have been:
1.55%(a)
</TABLE>
- --------------------------------------------------------------------------------
21
<PAGE>
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
<PAGE>
TRUSTEES
Laura E. Luckyn-Malone
Hermann C. Schwab
Peter E. Guernsey
Ralph E. Hansmann (Honorary)
John I. Howell
Clarence F. Michalis
Mark J. Smith
OFFICERS
Hermann C. Schwab
Chairman of the Board
Laura E. Luckyn-Malone
President
John Troiano
Vice President
Mark J. Smith
Vice President
Robert G. Davy
Vice President
Richard Foulkes
Vice President
Fariba Talebi
Vice President
Ira L. Unschuld
Vice President
John Y. Keffer
Vice President
Catherine A. Mazza
Vice President
Robert Jackowitz
Treasurer
Thomas G. Sheehan
Assistant Treasurer
Assistant Secretary
David I. Goldstein
Assistant Treasurer
Assistant Secretary
Margaret H. Douglas-Hamilton
Secretary
Gerardo Machado
Assistant Secretary
Barbara Gottlieb
Assistant Secretary
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
INVESTMENT ADVISER
Schroder Capital Management International Inc.
787 Seventh Avenue
New York, New York 10019
ADMINISTRATOR & DISTRIBUTOR
Schroder Fund Advisors Inc.
787 Seventh Avenue
New York, New York 10019
CUSTODIAN
The Chase Manhattan Bank, N.A.
Global Custody Division
Woolgate House, Coleman Street
London EC2P 2HD, United Kingdom
TRANSFER AND DIVIDEND DISBURSING AGENT
Forum Financial Corp.
Two Portland Square
Portland, Maine 04101
COUNSEL
Jacobs Persinger & Parker
77 Water Street
New York, New York 10005
INDEPENDENT AUDITORS
Coopers & Lybrand L.L.P.
One Post Office Square
Boston, Massachusetts 02109
This report is for the information of the shareholders
of the Schroder Emerging Markets Fund Institutional
Portfolio. Its use in connection with any offering of
the Fund's shares is authorized only in case of a
concurrent or prior delivery of the Fund's current
prospectus.
[Logo]
Schroder
Emerging
Markets
Fund Institutional
Portfolio
SEMI-ANNUAL REPORT
April 30, 1996
(Unaudited)
Schroder Capital Funds
(Delaware)
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND (FORMERLY INTERNATIONAL EQUITY FUND)
- --------------------------------------------------------------------------------
Two Portland Square, Portland, Maine 04101
<TABLE>
<S> <C>
General Information (207) 879-8903
Account Information (800) 344-8332
Fund Literature (800) 290-9826
Fax (800) 879-6206
</TABLE>
INVESTMENT OBJECTIVE
To provide shareholders with capital appreciation through investments in
securities markets outside the U.S. Securities are selected on the basis of
potential for capital appreciation without regard for current income.
INVESTMENT MANAGER
Schroder Capital Management International Inc. ('SCMI') is a wholly-owned
indirect subsidiary of Schroders plc, a publicly owned company organized under
the laws of England. Schroders plc is the holding company parent of a large
world-wide group of banks and financial services companies (the 'Schroder
Group') that dates its origins to 1804. The investment management subsidiaries
of the Schroder Group had, as of December 31, 1995, assets under management in
excess of $100 billion. As of that same date, SCMI, together with its U.K.
affiliate, Schroder Capital Management International Ltd., had over $17 billion
under management.
June 15, 1996
Dear Shareholder:
The Schroder International Fund rose in value by 12.3% during the six month
period ending April 30, 1996. This performance compares to a 13.3% return for
its benchmark, the unmanaged MSCI EAFE index.
Over the six month period, performance has been diverse in some of the
major markets where the Fund invests. Germany, Switzerland and the United
Kingdom, three countries where we have large weightings, all underperformed the
index. Selected smaller markets, such as Malaysia and Spain (up 28% and 24%
total return in U.S. dollars respectively), were strong performers relative to
the index. The emerging markets' strong rebound in the first months of 1996 also
added to overall returns.
The Fund saw particularly strong relative performance from a number of the
British and Dutch medium sized and small companies which currently make up a
significant part of the portfolio. These returns helped to offset weaker
relative performance in the Pacific Basin and some other European markets.
Despite continued strong returns from the U.S. market over the past six
months, we continue to believe that investors should be mindful of the benefits
of international diversification, which both lowers overall portfolio volatility
and creates a potential for higher overall portfolio returns. While the timing
of the relative underperformance of the U.S. market as compared to international
markets cannot be known, the discipline of setting aside a portion of the assets
of a long-term investment program into an international fund will help create a
portfolio with lower risk characteristics than one invested wholly in the U.S.
With respect to corporate matters, effective May 3, 1996, the Fund's name
was changed to the Schroder International Fund. The Fund continues to invest in
the International Equity Fund (the 'Portfolio'). The Portfolio's Schedule of
Investments and Financial Statements begins on page 12.
We remain optimistic about the prospects for international investing and
thank you for your continued support and interest in the Fund.
Sincerely,
<TABLE>
<S> <C>
/s/ Hermann C. Schwab /s/ Laura E. Luckyn-Malone
Hermann C. Schwab Laura E. Luckyn-Malone
Chairman President
</TABLE>
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
PORTFOLIO STRATEGY
Over the six month period, the Fund's exposure to Japan rose from 27% to
over 33% and the exposure to the U.K. was reduced from 14% of the portfolio to
less than 12%. The Netherlands accounted still for 10.5% at the end of April
while the exposure to Hong Kong was reduced from 6.7% to 3.5% which brings it
more in line with the index.
Purchases in Japan have focused almost exclusively on companies with an
exposure to a pick-up in domestic demand. As of April 30, 1996, two-thirds of
the portfolio's Japanese weighting was invested in companies wholly or largely
exposed to domestic consumption or capital investment spending and the remaining
third was invested in companies sensitive to world demand. We have avoided the
banking sector completely where the only potential for improvement is an end to
bad loan provisions. At this point, we believe the risks involved in owning
banking stocks are too high while the potential returns seem limited due to
historically high valuations.
We have sold a broad range of stocks in the U.K. and in the process have
left the portfolio with a particular bias towards medium-sized British companies
many of which are sensitive to consumer spending. Lower interest rates and tax
cuts are creating a 'feel good' effect which is no longer dampened by high
unemployment rates. The risk in the British market, as we perceive it at the
present time, is that the overly stimulative economic policy could result in
higher inflation and higher interest rates; hence our underweight position.
Elsewhere in Europe, we maintained a small overweight position heavily
skewed towards Germany, the Netherlands and Switzerland which comprise
approximately 75% of aggregate exposure to the region. Growth stocks, i.e.
shares of companies that are expected to show strong and regular earnings per
share growth, have been in strong demand over the past year in Europe.
Particularly in the Netherlands, the Fund has taken advantage of this trend as
some of the Fund's growth stocks have enjoyed impressive upward re-ratings.
Currency hedging remained limited in scope: approximately 40% of the
portfolio's Japanese yen and Swiss franc exposure was sold forward into dollars.
Together, these hedges covered around 15% of the total portfolio.
INVESTMENT REVIEW (AS OF APRIL 30, 1996)
An economic backdrop of falling short-term interest rates has been a
feature in nearly all European countries during the past six months. In Japan,
the rates have already fallen so low that they cannot meaningfully go lower.
This environment has fed optimism that a recovery in economic growth and in
corporate profits is in prospect, although still somewhat delayed in Europe.
Japan is now firmly on its way to recovery from a long recession. Continental
Europe is still lagging behind and is now expected to bounce back in the second
half of the year. Lower interest rates and a weaker currency are the two main
reasons why economists believe European economies will show better growth in the
coming months.
Japan has the best economic prospect of the major countries in the EAFE
universe. Recent economic data points to a moderately rising trend in domestic
demand with discretionary consumer spending on automobiles, tourism and in
department stores notably encouraging. Weak industrial production reflects the
continued excess inventory which is expected to diminish at current demand
levels.
Anticipated upward revisions of earnings, strong corporate cash flows and
the introduction of share buyback programs have led us to increase our exposure
to the Japanese stockmarket. The weakness of the yen has also played an
important role in the renewed interest in Japanese equities.
Economic growth is also expected to be strong in the U.K. Consumer spending
looks set to recover, sharply influenced by rising house prices and well timed
tax cuts as the government approaches parliamentary elections. From a
stockmarket standpoint, we fear that the economy will overheat and be undermined
by the threat of higher interest rates.
In Continental Europe, industrial production remains restricted by an
excess inventory that may persist through the year in many sectors. Business
confidence is low, but shows signs of turning around. However, with governments
still determined to reduce their fiscal deficits in accordance with the
Maastricht treaty, the prospects of a strong recovery remains small. The good
news is that the Central Banks have continued to ease monetary policies and
European currencies have depreciated against the dollar, which is providing an
uplift to export demand.
- --------------------------------------------------------------------------------
2
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
Far Eastern markets performed strongly in the beginning of 1996 although
fears of economic overheating have continued to restrain those markets for the
past eighteen months. The strongest increases have typically been where
confidence in a slow down is developing, as in Singapore and Malaysia. Hong
Kong's rising stockmarket reflected renewed optimism about the growth prospects
in China, but the political uncertainties linked to the changes in sovereignty
will most probably affect valuations for the near future.
The views expressed in this report were those of the Funds' portfolio
managers as of the dates specified, and may not reflect the views of the
portfolio managers on the date this report is first published or at any time
thereafter. These views are intended to assist shareholders of the Fund in
understanding their investments in the Fund and do not constitute investment
advice; investors should consult their own investment professionals as to their
individual investment programs.
- --------------------------------------------------------------------------------
3
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
FUND CHARACTERISTICS AS OF APRIL 30, 1996
<TABLE>
<CAPTION>
INVESTMENT BY INDUSTRY
INDUSTRY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Capital Equipment 13.7%
Consumer Goods 10.2%
Electrical Goods 18.3%
Energy 7.4%
Financial 16.4%
Materials 8.6%
Multi-Industry 3.6%
Services 19.5%
Cash and Other Net Assets 2.3%
-----------
Total 100.0%
-----------
-----------
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
SECURITY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Ito-Yokado Company Ltd. 3.1%
Asea Brown Boveri Ltd. 2.5%
Veba AG 2.4%
Murata Manufacturing Co. Ltd. 2.1%
Heineken NV 2.1%
DDI Corporation 2.1%
Int'l. Nederlanden Group NV 2.1%
Philips Electronics NV 2.0%
Novartis 1.7%
Astra AB 1.7%
----------
Total 21.8%
----------
----------
</TABLE>
COUNTRY WEIGHTINGS
<TABLE>
<CAPTION>
COUNTRY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Japan 33.4%
United Kingdom 11.0%
Netherlands 10.5%
Switzerland 7.3%
Germany 6.5%
France 4.1%
Hong Kong 4.1%
Sweden 3.1%
Malaysia 2.9%
Singapore 2.8%
Thailand 2.5%
<CAPTION>
COUNTRY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Indonesia 2.4%
Philippines 1.7%
Italy 1.7%
South Korea 1.6%
Brazil 1.1%
Mexico 0.4%
Chile 0.3%
Argentina 0.3%
Cash and other Net Assets 2.3%
-----------
Total 100.0%
-----------
-----------
</TABLE>
- --------------------------------------------------------------------------------
4
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1996
<TABLE>
<S> <C>
ASSETS:
Investment in International Equity Fund (Portfolio) (cost
$161,963,992) $225,354,038
Receivable for shares sold 256,799
------------
Total Assets 225,610,837
------------
LIABILITIES:
Payable for fund shares redeemed 82,167
Accrued administration fees (Note 3) 36,372
Other payables and accrued expenses 26,170
------------
Total Liabilities 144,709
------------
Net Assets $225,466,128
------------
------------
NET ASSETS CONSIST OF:
Paid-in capital 159,799,423
Undistributed net investment income 148,257
Accumulated gain on investments and foreign currency
transactions 2,128,402
Net unrealized appreciation of investments and foreign
currency transactions 63,390,046
------------
Net Assets $225,466,128
------------
------------
Net Asset Value price per share
($225,466,128 divided by 11,044,833
shares outstanding) $20.41
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
5
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1996
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $272,755) $ 1,685,423
Interest 33,499
-----------
Total Income 1,718,922
-----------
EXPENSES:
Investment advisory fees (Note 3) 481,373
Administration fees (Note 3) 374,178
Transfer agent fees and expenses (Note 3) 36,262
Custodian fees 67,412
Accounting service fees (Note 3) 42,000
Auditing fees 5,000
Other professional fees 15,668
Trustees fees and expenses 15,035
Other 50,267
Amortization of organization costs 1,237
-----------
Total Expenses 1,088,432
Expenses reimbursed and fees waived (Note 3) (27,523)
-----------
Net Expenses 1,060,909
-----------
NET INVESTMENT INCOME 658,013
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized gain on investments 680,790
Net realized gain on foreign currency transactions 1,446,758
Change in unrealized appreciation of investments 21,812,796
Change in unrealized appreciation of foreign currency
transactions 403,519
-----------
Net gain on investments and foreign currency transactions 24,343,863
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $25,001,876
-----------
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
6
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS FOR THE YEAR
ENDED ENDED
APRIL 30, 1996 OCTOBER 31, 1995
------------------ ----------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment income $ 658,013 $ 1,965,002
Net realized gain on investments and
foreign currency transactions 2,127,548 58,061,286
Change in unrealized appreciation
(depreciation) of investments and
foreign currency transactions 22,216,315 (59,690,024)
------------------ ----------------
Net increase in net assets resulting from
operations 25,001,876 336,264
------------------ ----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net realized gain (23,782,758) (54,730,616)
Net investment income (5,164,431) 0
------------------ ----------------
Total distributions to shareholders (28,947,189) (54,730,616)
------------------ ----------------
INCREASE (DECREASE) FROM CAPITAL SHARE
TRANSACTIONS (NOTE 4) 17,081,862 (233,780,034)
------------------ ----------------
INCREASE (DECREASE) IN NET ASSETS 13,136,549 (288,174,386)
NET ASSETS:
Beginning of period 212,329,579 500,503,965
------------------ ----------------
End of period $225,466,128 $212,329,579
------------------ ----------------
------------------ ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
7
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION:
SCHRODER INTERNATIONAL FUND (the 'Fund'), formerly known as
International Equity Fund, is a separately managed, diversified portfolio of
Schroder Capital Funds (Delaware) (the 'Trust'), a registered open-end
management investment company. The Fund currently seeks to achieve its
investment objective by holding, as its only investment security, an interest
in International Equity Fund (the 'Portfolio'), a separate portfolio of a
registered open-end management investment company having the same investment
objective and policies as the Fund. The Fund's investment in the Portfolio is
in the form of a non-transferable beneficial interest. As of the date of this
report, the Fund is the only institutional investor in the Portfolio. The
Portfolio may permit other investment companies or institutional investors to
invest in it. All investors will invest on the same terms and conditions as
the Fund and will pay a proportionate share of the Portfolio's expenses.
2. SIGNIFICANT ACCOUNTING POLICIES:
The Fund's financial statements are prepared in accordance with
generally accepted accounting principles which permit management to make
certain estimates and assumptions at the date of the financial statements and
are based on the significant accounting policies which follow. The Fund has a
fundamental investment policy that allows it to invest all of its investment
assets in the Portfolio. All other investment policies of the Fund and the
Portfolio are substantially the same. The policies and financial statements
of the Portfolio are presented in a subsequent section of this report.
A. Portfolio securities listed on the recognized stock exchanges
are valued at the last reported trade price on the exchange on which the
securities are principally traded. Listed securities traded on recognized
stock exchanges where last trade prices are not available are valued at
mid-market prices. Securities traded in over-the-counter markets, or
listed securities for which no trade is reported on the valuation date,
are valued at the most recent reported price. Other securities and assets
for which market quotations are not readily available, are valued at fair
value as determined in good faith using methods approved by the Board of
Trustees.
B. The Fund intends to continue to comply with the provisions of
Subchapter M of the Internal Revenue Code of 1986, as amended (the
'Code'), applicable to regulated investment companies. As a regulated
investment company, the Fund intends to distribute substantially all of
its net investment income and its net realized long term capital gains at
least annually and therefore intends not to be subject to Federal income
tax to the extent it distributes such income and capital gains in the
manner required under the Code.
C. The Portfolio is treated as a partnership for Federal income tax
purposes. All interest, dividends, gains and losses of the Portfolio are
deemed to have been 'passed through' to the Fund in proportion to its
holdings of the Portfolio, regardless of whether such interest, dividends
or gains have been distributed by the Portfolio. Investment transactions
are accounted for by the Portfolio on the trade date. Dividend income is
recorded by the Portfolio on the ex-dividend date. Interest income,
including amortization of discount or premium, is recorded by the
Portfolio as earned. Identified cost of investments sold is used to
determine gains and losses for both financial statement and Federal
income tax purposes. Foreign dividend and interest income amounts and
realized capital gains and losses are converted to U.S. dollar
equivalents by the Portfolio using foreign exchange rates in effect at
the date of the transactions.
D. Foreign currency amounts are translated into U.S. dollars at the
mean of the bid and asked prices of such currencies against U.S. dollars
as follows: assets and liabilities at the rate of exchange at the end of
the respective period; purchases and sales of securities and income and
expenses at the rate of exchange prevailing on the dates of such
transactions. It is not practical to isolate that portion of the results
of operations arising from changes in the exchange rates from the portion
arising from changes in the market prices of securities.
- --------------------------------------------------------------------------------
8
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
E. The Portfolio may enter into forward contracts to purchase or
sell foreign currencies to protect against the effect on the U.S. dollar
value of the underlying portfolio of possible adverse movements in
foreign exchange rates. Risks associated with such contracts include the
movement in value of the foreign currency relative to the U.S. dollar and
the ability of the counterparty to perform. Fluctuations in the value of
such contracts are recorded as unrealized gains or losses; realized gains
or losses include net gains or losses on contracts which have terminated
by settlement or by the Portfolio entering into offsetting commitments.
F. Distributions to shareholders are recorded on the ex-dividend
date. Income and capital gain distributions are determined in accordance
with Federal income tax regulations which may differ from generally
accepted accounting principles. Permanent book and tax basis differences
relating to shareholder distributions will result in reclassifications to
paid in capital and may affect the per share allocation between net
investment income and realized and unrealized gain or loss. Undistributed
net investment income and accumulated undistributed net realized gains or
losses may include temporary book and tax basis differences which will
reverse in a subsequent period. Any taxable income or gain remaining at
fiscal year end is distributed in the following year.
3. RELATED PARTIES:
For the six months ended April 30, 1996, remunerations to related
parties were paid or accrued in the following amounts:
<TABLE>
<CAPTION>
Earned Waived Net
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Schroder Capital Management International, Inc.
(Investment Adviser) $481,373 $22,018 $459,355
Schroder Fund Advisors Inc.
(Administrator and Distributor) 374,178 5,505 368,673
Forum Financial Corp.
(Fund Accountant and Transfer Agent) 78,262 -- 78,262
-------- ------- --------
$933,813 $27,523 $906,290
-------- ------- --------
-------- ------- --------
</TABLE>
The Fund currently invests all of its assets in the Portfolio which
retains Schroder Capital Management International, Inc. ('SCMI') to act as
investment adviser pursuant to an Investment Advisory Contract. SCMI manages
the investment and reinvestment of the assets included in the Portfolio and
continuously reviews, supervises and administers the Portfolio's investments.
It is the responsibility of SCMI to make decisions relating to the
Portfolio's investments and to place purchase and sale orders regarding such
investments with brokers or dealers selected at its discretion. For its
services as Investment Adviser to the Portfolio, SCMI receives a monthly fee
equal on an annual basis to 0.45% of the average daily net assets of the
Portfolio.
The Fund may, at any time, withdraw its investment from the Portfolio
if the Board of Trustees determines that it is in the best interests of the
Fund and its shareholders to do so. Accordingly, the Fund has retained SCMI
as its investment adviser to manage the Fund's assets in the event the Fund
so withdraws its investment. SCMI will not receive an investment advisory fee
with respect to the Fund so long as the Fund remains completely invested in
the Portfolio or any other investment company.
On behalf of the Fund, the Trust has entered into an Administrative
Services Contract with Schroder Fund Advisors Inc. ('Schroder Advisors'). In
addition, the Trust and Schroder Advisors have entered into a Sub-
Administration Agreement with Forum Financial Services ('Forum'). Pursuant to
their agreements, Schroder Advisors and Forum provide certain management and
administrative services necessary to the Fund's opera-
- --------------------------------------------------------------------------------
9
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
tions other than the investment management and administrative services
provided to the Fund by SCMI pursuant to the Investment Advisory Contract.
For these services, Schroder Advisors receives from the Fund, a fee payable
monthly at an annual rate of 0.20% of the average daily net assets of the
Fund. Payment for Forum's services is made by Schroder Advisors and is not a
separate expense of the Fund. Schroder Advisors and Forum provide similar
services to the Portfolio, for which Schroder Advisors is separately
compensated at an annual rate of 0.15% of the average daily net assets of the
Portfolio, a portion of which Forum receives for its services with respect to
the Portfolio.
Forum Financial Corp. ('FFC') , an affiliate of Forum, performs
portfolio accounting services for the Fund pursuant to a Fund Accounting
Agreement with the Trust. Under its agreement, FFC prepares and maintains
books and records of the Fund on behalf of the Trust that are required to be
maintained under the Investment Company Act of 1940, calculates the net asset
value per share of the Fund, calculates dividend and capital gain
distributions and prepares periodic reports to the shareholders and the
Securities and Exchange Commission. For its services, FFC receives from the
Trust, with respect to the Fund, a fee of $12,000 per year plus, for each
class of the Fund above one, an additional $12,000 per year.
FFC is also the Fund's transfer agent and dividend disbursing agent and
is compensated for those services by the Fund in the amount of $12,000 per
year, plus certain shareholder account fees.
The Fund bears all costs of its operations other than those
specifically assumed by SCMI or Schroder Advisors. Expenses directly
attributable to a fund within the Trust, are charged to that fund. Other
expenses are allocated proportionately among the funds in relation to the net
assets of each fund.
4. CAPITAL SHARES:
The Fund is authorized under the Trust's Trust Instrument to issue an
unlimited number of shares of beneficial interest without par value. At April
30, 1996 the Fund was comprised of one class of shares with 11,044,833 shares
outstanding.Transactions in the Fund's capital shares for the six months
ended April 30, 1996 and the year ended October 31, 1995 were as follows:
<TABLE>
<CAPTION>
Six Months Ended April 30, Year Ended October 31,
1996 1995
- ------------------------------------------------------------------------------------------------------------
Number Number
of of
Shares Amount Shares Amount
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold 1,342,111 $ 26,239,435 3,833,382 $ 76,164,063
Shares issued for reinvestment of
dividends 702,811 13,346,133 370,622 7,211,233
---------- ------------ ----------- -------------
2,044,922 39,585,568 4,204,004 83,375,296
Shares redeemed (1,153,577) (22,503,706) (15,654,701) (317,155,330)*
---------- ------------ ----------- -------------
Net increase (decrease) in outstanding
shares 891,345 $ 17,081,862 (11,450,697) $(233,780,034)
---------- ------------ ----------- -------------
---------- ------------ ----------- -------------
</TABLE>
* In November 1994, a major institutional investor in the Fund redeemed-in-kind
on a pro-rata basis approximately $281 million in securities held by the fund
resulting in a gain of $51,501,484 to the Fund. Through this redemption such
institutional investor transferred its investments in the Fund to its own
family of mutual funds, for which Schroder Capital Management International
Inc. serves as the investment adviser.
- --------------------------------------------------------------------------------
10
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
5. FINANCIAL HIGHLIGHTS
For a share outstanding throughout the period.
<TABLE>
<CAPTION>
Six Months
Ended
April 30, Year Ended October 31,
1996 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------
Net Asset Value, beginning of
period $20.91 $23.17 $20.38 $15.15 $16.22 $17.70
---------- ------ ------ ------ ------ ------
Investment operations:
Net investment income 0.20 0.46 0.18 0.08 0.25 0.25
Net realized and unrealized
gain (loss) on investments 2.09 (0.18) 2.69 5.27 (1.04) (0.25)
---------- ------ ------ ------ ------ ------
Total from investment operations 2.29 0.28 2.87 5.35 (0.79) 0.00
---------- ------ ------ ------ ------ ------
Distributions to shareholders from:
Net investment income (0.47) 0.00 (0.08) (0.12) (0.23) (0.25)
Realized capital gains (2.32) (2.54) 0.00 0.00 (0.05) (1.23)
---------- ------ ------ ------ ------ ------
Total distributions (2.79) (2.54) (0.08) (0.12) (0.28) (1.48)
---------- ------ ------ ------ ------ ------
Net Asset Value, end of period $20.41 $20.91 $23.17 $20.38 $15.15 $16.22
---------- ------ ------ ------ ------ ------
---------- ------ ------ ------ ------ ------
Total return 12.25% 2.08% 14.10% 35.54% (4.93%) 0.45%
---------- ------ ------ ------ ------ ------
---------- ------ ------ ------ ------ ------
Ratios/supplementary data:
Net assets, end of year (thousands) $225,466 $212,330 $500,504 $320,550 $159,556 $108,398
Ratio of expenses to average net
assets(b) 0.99%(a) 0.91% 0.90% 0.91% 0.93% 1.07%
Ratio of net investment income to
average net assets 0.61%(a) 0.99% 0.94% 0.87% 1.62% 1.59%
Portfolio turnover(c) -- 61.26% 25.17% 56.05% 49.42% 50.58%
</TABLE>
(a) Annualized.
(b) During the period, various fees and expenses may have been waived and
reimbursed, respectively. Had such waiver and reimbursement not occurred,
the ratio of expenses to average net assets would have been:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
1.02%(a) 0.91% 0.90% 0.91% 0.93% 1.07%
</TABLE>
(c) Now calculated at the portfolio level.
6. SUBSEQUENT EVENT:
Effective May 16, 1996 the Fund began offering two classes of shares,
Investor Shares and Advisor Shares. Investor Shares are offered for sale at
net asset value as an investment vehicle for individuals, institutions,
corporations and fiduciaries. Advisor Shares are offered for sale at net
asset value to individual investors primarily through banks, trust companies,
broker-dealers or other financial organizations and incur higher expenses
than Investor Shares. On May 16, 1996, all existing shares of the Fund were
converted to Investor Shares.
- --------------------------------------------------------------------------------
11
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1996
<TABLE>
<CAPTION>
SHARES VALUE US$
------ ----------
<S> <C> <C>
ARGENTINA - 0.3%
COMMON STOCK
89,722 Perez Companc SA
Oil Exploration & Production 563,972
-----------
563,972
-----------
BRAZIL - 1.2%
COMMON STOCK
30,600 Telecomunicacoes Brasileiras
SA-Telebras ADR
Telecommunications 1,656,226
81,400 Usinas Siderurgicas de Minas
Gerais SA-Usiminas
Engineering 926,332
-----------
2,582,558
-----------
CHILE - 0.3%
COMMON STOCK
7,000 Compania de Telecomunicaciones
de Chile SA
Utilities/Telecommunications 638,750
-----------
638,750
-----------
FRANCE - 4.1%
COMMON STOCK
14,325 Compagnie Generale des Eaux
Utilities 1,555,050
47,000 Elf Aquitaine
Oil 3,488,845
6,484 Guilbert SA
Wholesale Trade 1,063,321
13,820 Primagaz (Cie Des Gaz Petrole)
Energy 1,478,873
27,500 Valeo
Automobiles 1,523,440
WARRANTS
1,256 Primagaz (Cie Des Gaz
Petrole)*
Energy 24,503
-----------
9,134,032
-----------
GERMANY - 6.6%
COMMON STOCK
1,600 Allianz AG Holding
Insurance 2,727,355
1,390 Buderus AG
Machinery Engineering
Services 507,597
4,500 Mannesmann AG
Machinery 1,537,072
3,700 Siemens AG
Multi-Industry 2,018,291
110,000 Veba AG
Multi-Industry 5,426,475
62 Wella AG
Health/Personal Care 27,816
GERMANY (CONCLUDED)
PREFERRED STOCK
1,336 Friedrich Grohe AG
Construction/Building
Materials 313,635
7,000 SAP AG
Business Services/Computer
Software 928,921
2,496 Wella AG
Health/Personal Care 1,090,525
-----------
14,577,687
-----------
HONG KONG - 4.2%
COMMON STOCK
198,100 Cheung Kong (Holdings) Ltd
Real Estate 1,414,964
96,813 HSBC Holdings plc
Banks 1,445,587
177,600 Hongkong Electric Holdings Ltd
Electricity & Gas 564,816
314,400 Hutchison Whampoa Ltd
Multi-Industry 1,950,977
205,400 Sun Hung Kai Properties Ltd
Real Estate 1,958,353
144,400 Swire Pacific Ltd
Commerce/Industrial 1,232,082
186,700 Wharf (Holdings) Ltd
Real Estate 691,508
-----------
9,258,287
-----------
INDONESIA - 2.5%
COMMON STOCK
278,600 PT Indocement Tunggal Prakarsa
Multi-Industry 1,076,405
258,550 PT Indofoods Sukses Makmur*
Food/Grocery Products 1,190,401
335,000 PT Indosat
Telecommunications 1,164,881
820,000 PT Telekomunikasi Indonesia*
Telecommunications 1,364,072
42,490 PT Unilever Indonesia
Retailers, General 684,022
-----------
5,479,781
-----------
ITALY - 1.7%
COMMON STOCK
652,785 Telecom Italia Mobile SpA*
Telecommunications 1,439,449
1,124,455 Telecom Italia SpA
Utilities 2,289,067
-----------
3,728,516
-----------
</TABLE>
- --------------------------------------------------------------------------------
12
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
APRIL 30, 1996
<TABLE>
<CAPTION>
SHARES VALUE US$
------ ----------
<S> <C> <C>
JAPAN - 34.2%
COMMON STOCK
17,600 Advantest Corporation
Electrical Equipment 872,007
47,000 Amada Metrecs Company Ltd
Electrical Appliances 776,219
160,000 Bridgestone Corporation
Rubber Goods 2,963,206
555 DDI Corporation
Utilities/Telecommunications 4,763,135
90,000 Dai Nippon Printing Company Ltd
Miscellaneous Manufacturing 1,692,578
90,000 Dai-Tokyo Fire & Marine
Insurance Company
Insurance 706,244
250 East Japan Railway Company
Land Transport 1,334,111
18,000 Fanuc Company
Machinery 781,851
110,000 Fuji Photo Film Company
Miscellaneous Manufacturing 3,423,343
60,000 Fujitsu Ltd
Computers/Communications/Office
Equipment 618,607
19,900 Hirose Electric Company
Electrical Appliances 1,227,229
295,000 Hitachi Ltd
Electrical Appliances 3,182,296
27,000 Hoya Corporation
Jewelry/Gemstones/Watch 953,687
118,000 Ito-Yokado Company Ltd
Retail Sales 6,950,361
22,000 Japan Airport Terminal Company
Commercial Services 317,131
126,000 Kuraray Company Ltd
Textiles 1,455,446
24,000 Kyocera Corporation
Electrical Appliances 1,805,418
22,000 Mabuchi Motor Company
Electrical Appliances 1,352,536
38,000 Makita Corporation
Electrical Appliances 613,071
144,000 Matsushita Electric Industrial
Company Ltd
Electrical Appliances 2,543,164
100,000 Mitsubishi Corporation
Miscellaneous Distribution/
Wholesale Trade 1,422,415
271,000 Mitsubishi Heavy Industries Ltd
Miscellaneous Manufacturing 2,416,330
125,000 Murata Manufacturing Company Ltd
Electrical Appliances 4,844,805
JAPAN (CONCLUDED)
70,000 NEC Corporation
Computers/Communications/Office
Equipment 888,771
3,000 Nippon Television Network
Corporation
Telecommunications 942,231
85,000 Omron Corporation
Electronics 1,915,010
37,700 SMC Corporation
Electronics 2,933,183
49,000 Sankyo Company Ltd
Pharmaceuticals 1,188,146
25,000 Seino Transportation Company
Land Transport 439,135
91,350 Shin - Etsu Chemical Company
Chemicals 1,997,027
136,000 Showa Shell Sekiyu KK
Oil Exploration & Production 1,454,109
215,000 Takeda Chemical Industries
Pharmaceuticals 3,714,985
8,000 Toho Company
Leisure & Hotels 1,389,958
193,000 Tokio Marine & Fire Insurance
Company
Insurance 2,653,139
51,000 Tokyo Electron Ltd
Electrical Appliances 1,893,913
63,000 Tokyo Style
Textiles & Apparel 1,118,648
80,000 Toppan Printing Company Ltd
Paper, Packaging & Printing 1,176,118
166,000 Toray Industries
Chemicals 1,128,310
150,000 Toyota Motor Corporation
Automobiles 3,422,387
-----------
75,270,260
-----------
KOREA, REPUBLIC OF - 1.6%
COMMON STOCK
19,000 Korea Electric Power Corporation
Electricity & Gas 867,498
10,250 Pohang Iron & Steel Company Ltd
Iron & Steel 939,093
6,000 Samsung Electronics Company
Electrical Equipment 817,245
1,808 Samsung Electronics Company 1st
New*
Electrical Equipment 240,455
29,957 Shinhan Bank
Banks 721,687
-----------
3,585,978
-----------
</TABLE>
- --------------------------------------------------------------------------------
13
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
APRIL 30, 1996
<TABLE>
<CAPTION>
SHARES VALUE US$
------ ----------
<S> <C> <C>
MALAYSIA - 3.0%
COMMON STOCK
221,000 Genting Berhad
Leisure & Hotels 1,985,162
219,500 Malayan Banking Berhad
Banks 2,138,930
490,000 Renong Berhad
Commerce/Industrial 852,789
177,000 Telekom Malaysia Berhad
Telecommunications 1,668,003
-----------
6,644,884
-----------
MEXICO - 0.4%
COMMON STOCK
82,700 Apasco SA de CV
Building Materials 443,777
92,000 Industrias Penoles
Mining Metals/Minerals 398,031
-----------
841,808
-----------
NETHERLANDS - 10.7%
COMMON STOCK
6,886 Ceteco Holdings NV
Household Durables/Appliances 290,981
31,514 Getronics NV
Computers/Communications/Office
Equipment 2,185,794
20,317 Hagemeyer NV
Miscellaneous
Distribution/Wholesale 1,389,044
23,000 Heineken NV
Beverage Manufacturers 4,807,250
58,835 Internationale Nederlanden Group
NV
Insurance 4,536,848
33,804 KLM Royal Dutch Air Lines NV
Transportation 1,132,908
34,818 NV Koninklijke Sphinx
Gustavsberg
Construction/Building Materials 570,255
6,932 Nedcon Groep NV
Industrial Equipment 132,927
165 Nedcon Groep NV - 1/42
Industrial Equipment 69
26,253 Oce-Van Der Grinten NV
Computers/Communications/Office
Equipment 2,410,006
27,000 Otra NV
Building Materials &
Merchandise 668,823
135,000 Philips Electronics NV
Electrical Equipment 4,760,448
21,512 Samas-Groep NV
Computers/Communications/Office
Equipment 777,376
NETHERLANDS (CONCLUDED)
PREFERRED STOCK
4,800 Internationale Nederlanden Group
NV
Insurance 25,459
-----------
23,688,188
-----------
PHILIPPINES - 1.8%
Common Stock
747,625 Ayala Land Incorporated 'B'
Shares
Real Estate 1,157,487
23,670 Manila Electric Company
Electricity & Gas 1,106,573
7,000 Philippine Long Distance
Telephone Company
Telecommunications 355,899
8,550 Philippine Long Distance
Telephone Company ADR
Telecommunications 429,638
2,860,000 SM Prime Holdings*
Real Estate 830,916
-----------
3,880,513
-----------
SINGAPORE - 2.9%
COMMON STOCK
155,000 City Developments Ltd
Real Estate 1,356,071
104,750 Development Bank of Singapore
Ltd
Banks 1,326,232
150,000 Keppel Corporation Ltd
Commerce/Industrial 1,355,004
86,333 Oversea-Chinese Banking
Corporation Ltd
Banks 1,185,167
61,920 Singapore Press Holdings Ltd
Telecommunications 1,171,543
-----------
6,394,017
-----------
SWEDEN - 3.2%
COMMON STOCK
86,000 Astra AB
Pharmaceuticals 3,789,466
126,000 Stora Kopparbergs Bergslags
Aktiebolag 'B' Shares
Forestry, Paper Products 1,686,921
77,000 Telefonaktiebolaget LM Ericsson
'B' Shares
Telecommunications 1,557,673
-----------
7,034,060
-----------
SWITZERLAND - 7.4%
COMMON STOCK
4,700 ABB Asea Brown Boveri Ltd
Machine-Diversified 5,649,365
</TABLE>
- --------------------------------------------------------------------------------
14
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
APRIL 30, 1996
<TABLE>
<CAPTION>
SHARES VALUE US$
------ ----------
<S> <C> <C>
SWITZERLAND (CONCLUDED)
21,000 CS Holding AG
Banks 1,902,418
2,260 Nestle SA
Food/Grocery Products 2,507,681
3,400 Novartis
Chemicals 3,936,526
300 Roche Holding AG
Health/Personal Care 2,353,768
-----------
16,349,758
-----------
THAILAND - 2.6%
COMMON STOCK
88,000 Bangkok Bank Public Company Ltd
Banks 1,275,610
56,000 Land & House Public Company Ltd
Real Estate 864,982
17,300 Siam Cement Public Company Ltd
Construction/Building Materials 890,725
397,000 Siam City Bank Public Company
Ltd
Banks 475,632
265,000 TelecomAsia Corporation Public
Company Ltd*
Telecommunications 750,422
130,400 Thai Farmers Bank Public Company
Ltd
Banks 1,497,716
-----------
5,755,087
-----------
UNITED KINGDOM - 11.3%
COMMON STOCK
140,700 Airtours plc
Leisure & Hotels 1,106,344
252,600 Allied Colloids Group plc
Chemicals 504,139
289,000 Asda Group plc
Retailers, Food 493,304
72,000 Barclays plc
Banks 795,198
35,000 British Aerospace plc
Precision Machinery 457,195
94,000 British Airways plc
Transportation 732,083
185,300 British Land Company plc
Real Estate 1,201,225
210,000 British Steel plc
Engineering 625,526
130,000 Cable & Wireless plc
Telecommunications 1,017,332
UNITED KINGDOM (CONCLUDED)
108,000 Cadbury Schweppes plc
Food Producers 837,065
135,000 Courtaulds plc
Chemicals 867,047
132,000 English China Clays plc
Extractive Industries 578,392
162,773 Enterprise Oil plc
Oil Exploration & Production 1,094,273
162,400 Guardian Royal Exchange plc
Insurance 549,538
96,000 Guinness plc
Spirits, Wines & Ciders 689,316
70,000 Johnson Matthey plc
Diversified Industrials 638,655
76,800 Kingfisher plc
Retailers, General 685,714
414,000 LASMO plc
Oil/Gas 1,205,222
64,000 Laird Group plc
Engineering, Vehicles 469,628
165,400 Lloyds TSB Group plc
Banks 790,515
400,000 Lucas Industries plc
Engineering, Vehicles 1,290,517
360,400 MFI Furniture plc
Retailers, General 962,653
115,835 Prudential Corporation plc
Insurance 795,236
74,000 RTZ Corporation plc
Mining Metals/Minerals 1,161,524
157,000 Rank Organisation plc
Leisure & Hotels 1,255,717
82,188 The Peninsular and Orient Steam
Navigational Company
Transportation 643,790
157,352 United News & Media plc
Media 1,638,690
144,000 Vickers plc
Engineering 557,503
204,700 Vodafone Group plc
Telecommunications 815,543
19,000 Zeneca Group plc
Pharmaceuticals 397,164
-----------
24,856,048
-----------
Total Investments 100.0%
(cost $198,451,388) 220,264,184
-----------
-----------
</TABLE>
* Non-income producing security.
- --------------------------------------------------------------------------------
15
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1996
<TABLE>
<S> <C>
ASSETS:
Investments, at value (at cost, $198,451,388) (Notes 2A and
3) $220,264,184
Cash 3,725,053
Receivable for securities sold 1,656,132
Receivable for forward foreign currency contracts, net (Note
1E) 74,409
Receivable for dividends, tax reclaims and interest 763,065
Organization costs, net of amortization 11,130
------------
Total Assets 226,493,973
------------
LIABILITIES:
Payable for securities purchased 979,724
Accrued advisory fees (Note 4) 81,834
Accrued administration fees (Note 4) 13,639
Other payables and accrued expenses 64,738
------------
Total Liabilities 1,139,935
------------
Net Assets $225,354,038
------------
------------
NET ASSETS CONSIST OF:
Investors' capital 203,137,723
Accumulated net unrealized appreciation of investments and
foreign currency 22,216,315
------------
Net Assets $225,354,038
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
16
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1996
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $272,755) $ 1,685,423
Interest 33,499
-----------
Total Income 1,718,922
-----------
EXPENSES:
Investment advisory fees (Note 4) 481,373
Administration fees (Note 4) 160,458
Transfer agent fees and expenses (Note 4) 6,025
Custodian fees 67,412
Accounting service fees (Note 4) 36,000
Other professional fees 8,037
Trustee fees and expenses 10,397
Other 38,862
Amortization of organization costs 1,237
-----------
Total Expenses 809,801
-----------
NET INVESTMENT INCOME 909,121
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized gain on investments 680,790
Net realized gain on foreign currency transactions 1,446,758
Change in unrealized appreciation of investments 21,812,796
Change in unrealized appreciation of foreign currency
transactions 403,519
-----------
NET GAIN ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS 24,343,863
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $25,252,984
-----------
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
17
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS
ENDED
APRIL 30, 1996
------------------
<S> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment income $ 909,121
Net realized gain on investments and foreign currency
transactions 2,127,548
Change in unrealized appreciation of investments and foreign
currency transactions 22,216,315
------------------
Net increase in net assets resulting from operations 25,252,984
------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTERESTS:
Contributions 227,991,636
Withdrawals (27,890,582)
------------------
200,101,054
------------------
INCREASE IN NET ASSETS 225,354,038
NET ASSETS:
Beginning of period --
------------------
End of period $225,354,038
------------------
------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
18
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION:
INTERNATIONAL EQUITY FUND (the 'Portfolio') is a separately managed,
diversified portfolio of Schroder Capital Funds, a registered open-end
management investment company. The Portfolio's investment objective is
long-term capital appreciation through investment in securitites markets
outside the United States.
2. SIGNIFICANT ACCOUNTING POLICIES:
The Portfolio's financial statements are prepared in accordance with
generally accepted accounting principles which permit management to make
certain estimates and assumptions at the date of the financial statements and
are based on the following significant accounting policies:
A. Portfolio securities listed on the recognized stock exchanges
are valued at the last reported trade price on the exchange on which the
securities are principally traded. Listed securities traded on recognized
stock exchanges where last trade prices are not available are valued at
mid-market prices. Securities traded in over-the-counter markets, or
listed securities for which no trade is reported on the valuation date,
are valued at the most recent reported price. Other securities and assets
for which market quotations are not readily available, are valued at fair
value as determined in good faith using methods approved by the Board of
Trustees.
B. The Portfolio is not required to pay Federal income taxes on its
net investment income and net capital gain, as it is treated as a
partnership for Federal income tax purposes. All interest, dividends,
gains and losses of the Portfolio are deemed to have been 'passed
through' to the partners in proportion to their holdings of the Portfolio
regardless of whether such interest, dividends or gains have been
distributed by the Portfolio.
C. Investment transactions are accounted for on the trade date.
Dividend income is recorded on the ex-dividend date. Interest income,
including amortization of discount or premium, is recorded as earned.
Identified cost of investments sold is used to determine gains and losses
for both financial statement and Federal income tax purposes. Foreign
dividend and interest income amounts and realized capital gains and
losses are converted to U.S. dollar equivalents using foreign exchange
rates in effect at the date of the transactions.
D. Foreign currency amounts are translated into U.S. dollars at the
mean of the bid and asked prices of such currencies against U.S. dollars
as follows: assets and liabilities at the rate of exchange at the end of
the respective period; purchases and sales of securities and income and
expenses at the rate of exchange prevailing on the dates of such
transactions. It is not practical to isolate that portion of the results
of operations arising from changes in the exchange rates from the portion
arising from changes in the market prices of securities.
E. The Portfolio may enter into forward contracts to purchase or
sell foreign currencies to protect against the effect on the U.S. dollar
value of the underlying portfolio of possible adverse movements in
foreign exchange rates. Risks associated with such contracts include the
movement in value of the foreign currency relative to the U.S. dollar and
the ability of the counterparty to perform. Fluctuations in the value of
such contracts are recorded as unrealized gains or losses; realized gains
or losses include net gains or losses on contracts which have terminated
by settlement or by the Portfolio entering into offsetting commitments.
- --------------------------------------------------------------------------------
19
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
At April 30, 1996 the Portfolio was obligated to deliver (sell)
foreign currencies in exchange for U.S. dollars as follows:
<TABLE>
<CAPTION>
U.S. Unrealized
Contract Date Currency Units Dollars Gain (Loss)
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Sell 6/21/96 Japanese Yen 2,697,000 $25,680,823 $(186,104)
Sell 6/14/96 Swiss Francs 10,000,000 8,332,523 260,513
----------- -----------
$34,013,346 $ 74,409
----------- -----------
----------- -----------
</TABLE>
3. PURCHASES AND SALES OF SECURITIES:
The cost of securities purchased and the proceeds from sales of
securities or maturities for the six months ended April 30, 1996 aggregated
$34,771,053 and $42,881,175 respectively.
For Federal income tax purposes, the tax basis of investment securities
owned at April 30, 1996 was $198,451,388. The aggregate gross unrealized
appreciation for all securities in which there was an excess of market value
over tax cost was $25,836,175 and the aggregate gross unrealized depreciation
for all securities in which there was an excess of tax cost over market value
was $4,023,379.
4. RELATED PARTIES:
For the six months ended April 30, 1996, remunerations to related
parties were paid or accrued in the following amounts:
<TABLE>
- -----------------------------------------------------------------------------------------------------
<S> <C>
Schroder Capital Management International, Inc.
(Investment Adviser) $481,373
Schroder Fund Advisors Inc.
(Administrator and Distributor) 160,458
Forum Financial Corp.
(Fund Accountant and Transfer Agent) 42,025
--------
$683,856
--------
--------
</TABLE>
The Portfolio retains Schroder Capital Management International, Inc.
('SCMI') to act as investment adviser pursuant to an Investment Advisory
Contract. SCMI manages the investment and reinvestment of the assets included
in the Portfolio and continuously reviews, supervises and administers the
Portfolio's investments. It is the responsibility of SCMI to make decisions
relating to the Portfolio's investments and to place purchase and sale orders
regarding such investments with brokers or dealers selected at its
discretion. For its services as Investment Adviser to the Portfolio, SCMI
receives a monthly fee equal on an annual basis to 0.45% of the average daily
net assets of the Portfolio.
The Portfolio has entered into an Administrative Services Contract with
Schroder Fund Advisors Inc. ('Schroder Advisors'). In addition, the Portfolio
and Schroder Advisors have entered into a Sub-Administration Agreement with
Forum Financial Services ('Forum'). Pursuant to their agreements, Schroder
Advisors and Forum provide certain management and administrative services
necessary to the Portfolio's operations other than the investment management
and administrative services provided to the Portfolio by SCMI pursuant to the
Investment Advisory Contract. Schroder Advisors is compensated for these
services at an annual rate of 0.15%
- --------------------------------------------------------------------------------
20
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUND (PORTFOLIO)
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
of the average daily net assets of the Portfolio, a portion of which Forum
receives for its services with respect to the Portfolio.
Forum Financial Corp. ('FFC') , an affiliate of Forum, performs
portfolio accounting services for the Portfolio pursuant to a Fund Accounting
Agreement with Schroder Capital Funds. For its services, FFC receives a fee
of $60,000 per year.
FFC is also the Portfolio's transfer agent and dividend disbursing
agent pursuant to a Transfer Agency Agreement betweeen Schroder Capital Funds
and FFC. FFC is compensated for those services in the amount of $12,000 per
year, plus certain shareholder account fees.
5. FINANCIAL HIGHLIGHTS:
Portfolio performance for the six months ended April 30, 1996.
<TABLE>
<S> <C>
Ratio of expenses to average net assets 0.75%(a)
Ratio of net investment income to average net assets 0.87%(a)
Portfolio turnover rate 19.07%
Average brokerage commission per share $.029
</TABLE>
(a) Annualized.
- --------------------------------------------------------------------------------
21
<PAGE>
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
TRUSTEES
Laura E. Luckyn-Malone
Hermann C. Schwab
Peter E. Guernsey
Ralph E. Hansman (Honorary)
John I. Howell
Clarence F. Michalis
Mark J. Smith
OFFICERS
Hermann C. Schwab
Chairman of the Board
Laura E. Luckyn-Malone
President
John Troiano
Vice President
Mark J. Smith
Vice President
Robert G. Davy
Vice President
Richard Foulkes
Vice President
Fariba Talebi
Vice President
Ira L. Unschuld
Vice President
John Y. Keffer
Vice President
Jane Lucas
Vice President
Catherine A. Mazza
Vice President
Robert Jackowitz
Treasurer
Thomas G. Sheehan
Assistant Treasurer
Assistant Secretary
David I. Goldstein
Assistant Treasurer
Assistant Secretary
Margaret H. Douglas-Hamilton
Secretary
Gerardo Machado
Assistant Secretary
Barbara Gottlieb
Assistant Secretary
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
INVESTMENT ADVISER
Schroder Capital Management International Inc.
787 Seventh Avenue
New York, New York 10019
ADMINISTRATOR & DISTRIBUTOR
Schroder Fund Advisors Inc.
787 Seventh Avenue
New York, New York 10019
CUSTODIAN
The Chase Manhattan Bank, N.A.
Global Custody Division
Woolgate House, Coleman Street
London EC2P 2HD, United Kingdom
TRANSFER AND DIVIDEND
DISBURSING AGENT
Forum Financial Corp.
Two Portland Square
Portland, Maine 04101
COUNSEL
Jacobs Persinger & Parker
77 Water Street
New York, New York 10005
INDEPENDENT AUDITORS
Coopers & Lybrand L.L.P.
One Post Office Square
Boston, Massachusetts 02109
This report is for the information of the shareholders
of the Schroder International Fund. Its use in connec-
tion with any offering of the Fund's shares is author-
ized only in case of a concurrent or prior delivery of
the Fund's current prospectus.
[Logo]
Schroder
International
Fund
SEMI-ANNUAL REPORT
April 30, 1996
(Unaudited)
Schroder Capital Funds
(Delaware)
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
Two Portland Square, Portland, Maine 04101
<TABLE>
<S> <C>
General Information (207) 879-8903
Account Information (800) 344-8332
Fund Literature (800) 290-9826
Fax (800) 879-6206
</TABLE>
INVESTMENT OBJECTIVE
Long term capital appreciation through investment in U.S. common stock and
securities convertible into common stock.
INVESTMENT MANAGER
Schroder Capital Management International Inc. ('SCMI') is a wholly-owned
indirect subsidiary of Schroders plc, a publicly owned company organized under
the laws of England. Schroders plc is the holding company parent of a large
world-wide group of banks and financial services companies (the 'Schroder
Group') that dates its origins to 1804. The investment management subsidiaries
of the Schroder Group had, as of December 31, 1995, assets under management in
excess of $100 billion. As of that same date, SCMI, together with its U.K.
affiliate, Schroder Capital Management International Ltd., had over $17 billion
under management.
June 15, 1996
Dear Shareholder:
Over the past six months, management of the Schroder U.S. Equity Fund has
focused its efforts on the positioning of the Fund and the characteristics of
the companies in which it invests. Consistent with its objective of long-term
capital appreciation, the style and approach can be summarized as 'capital
growth' with an emphasis on large capitalization companies. Sectors likely to be
emphasized will be those with good industry growth trends, for example,
technology, healthcare, entertainment and services. Utilities and basic
materials will be de-emphasized. The person primarily responsible for the
day-to-day management of the Fund's portfolio is Jane Lucas who along with her
team in New York is also able to utilize the global resources of Schroder
Capital Management International Inc. Our resources for researching the U.S.
Equity market have been increased substantially as a result of integration
between Schroders and Schroder Wertheim Investment Services which has been
completed successfully over the last eighteen months.
On the overall economic front, in late 1995 and early this year,
conventional wisdom was that the U.S. economy was teetering on the brink of
recession, that the Federal Reserve would be easing monetary policy in an
aggressive manner throughout 1996, and that inflation would be flat to down
vis-a-vis 1995. Harsh weather and several government shutdowns exacerbated the
economy's problems over the winter, adding to the general atmosphere of gloom
and doom. Our view during this whole episode was that the inventory excess was
mild and that the adjustment process would thus not be sufficient to tip the
economy into recession. Furthermore, bad weather and government shutdowns were
simply temporary hurdles for the economy that would be unlikely to have a
lasting impact. Events such as a successful inventory adjustment, stronger job
growth and a continued solid expansion in final demand, now seem to have
vindicated our view (which was out of favor for a few months).
Although consensus expectations have risen in response to these recent
signs of strength in the economy, we believe that the economy still has more
upside potential in 1996 than most believe. We are looking for an average
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
of 3.5% real GDP growth in the middle two quarters of the year, which is almost
a full percentage point above consensus surveys taken in mid-May. We also expect
inflation to edge up in the months ahead due to the impact of above trend growth
against a backdrop of an economy already bumping up against capacity
constraints. In order to head off a potentially significant rise in inflation,
the Federal Reserve is likely sometime this summer to begin to tighten monetary
policy, with the first move possibly coming as early as the July 2/3 Federal
Open Market Committee meeting. The ultimate extent of monetary tightening is not
anticipated to be severe, perhaps being limited to reversing the 75 basis points
of easing which was implemented over the course of the second half of 1995 and
very early this year.
We thank you for your continued support and interest in the Fund.
Sincerely,
<TABLE>
<S> <C>
/s/ Hermann C. Schwab /s/ Laura E. Luckyn-Malone
Hermann C. Schwab Laura E. Luckyn-Malone
Chairman President
</TABLE>
- --------------------------------------------------------------------------------
2
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
PORTFOLIO STRATEGY (AS OF APRIL 30, 1996)
The Schroder U.S. Equity Fund returned 13.1% over the six months ended
April 30, 1996, as compared to a rise of 13.8% in the S&P 500. Performance
suffered towards the end of 1995 when defensive issues moved heavily into favor
as fears of recession mounted. We did not share these expectations, and the Fund
benefited accordingly when more economically sensitive issues picked up in 1996.
Our investment strategy has been based on expectations of solid, if not
spectacular, economic growth in 1996 and 1997, following the inventory
correction of late 1995. At the same time, we have expected the growth rate of
corporate earnings as a whole to slow quite sharply, with companies facing
especially difficult comparisons in the first half of the year. Therefore, stock
selection has focused on companies that must be able to sustain superior growth
trends either through their involvement in niche industries or because of margin
improvement internally at a time when easy cost cutting is already behind many
companies. This had to be accomplished against a background of deterioration in
analysts' earnings estimates generally, and where loss of earnings momentum has
sometimes been punished severely. Consequently, we were wary of the technology
sector for much of the period, only moving to an overweight position in April
when expectations appeared to have been adequately reined in. Weakness in the
retail sector was used in late 1995 to add to positions in stocks which appeared
to have overcompensated for lower than historic growth rates, such as Wal-Mart
Stores, Inc. and Toys R Us, Inc. However, we are not convinced that the
apparently strong consumer spending trends are sustainable for the full year and
have reduced exposure on rallies. The Fund ends the six month period holding
more than it did at the beginning of the fiscal year in both technology and
consumer staples and somewhat less in consumer cyclicals.
The U.S. equity market has been quite resilient in the face of bond market
weakness. Given the improbability of further declines in short term interest
rates, earnings growth is likely to be the major catalyst for further market
gains. Most recently, the market has identified cyclically sensitive issues as
having better growth prospects in the second half of the year which has led the
basic industry and consumer cyclical issues to be the best performing areas year
to date. Technology has also started to regain momentum, while more stable
consumer growth and healthcare names have lagged. We see continued opportunity
for an economically sensitive company such as Rockwell International Corp.,
primarily attributed to its restructuring activities and niche growth businesses
within its mix such as fax modem semiconductors and process controls. We think
it is likely, though, that as the year progresses individual stockpicking rather
than sector selection will be key to identifying successful growth
opportunities. In particular, we are seeking to identify companies with
improving margins and sustainable revenue growth. Raychem Corporation, a
speciality materials manufacturer purchased early in 1996 showed this potential
in its first quarter report and the stock price responded well. Pharmacia &
Upjohn Inc., the drug manufacturer, appears to have a similar opportunity ahead.
Currently the Fund is overweight in the technology and capital goods sectors
relative to the index, but remains underweight in the consumer staples sector.
Should the recent underperformance of the healthcare industry (within the
consumer staples sector) continue, it is likely to receive more emphasis in the
coming months.
The views expressed in this report were those of the Fund's portfolio
managers as of the dates specified, and may not reflect the views of the
portfolio managers on the date this report is first published or at any time
thereafter. These views are intended to assist shareholders of the Funds in
understanding their investments in the Funds and do not constitute investment
advice; investors should consult their own investment professionals as to their
individual investment programs.
- --------------------------------------------------------------------------------
3
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF APRIL 30, 1996
<TABLE>
<CAPTION>
INVESTMENT BY INDUSTRY
INDUSTRY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Basic Materials 3.5%
Capital Goods/Construction 12.2%
Consumer Cyclicals 12.2%
Consumer Staples 18.5%
Energy 10.6%
Financial 14.5%
Technology 14.6%
Transportation/Services/Miscellaneous 6.7%
Utilities 4.5%
Cash and Other Net Assets 2.7%
---------------
Total 100.0%
---------------
---------------
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
<S> <C>
SECURITY % OF PORTFOLIO
- --------------------------------------------------------
BankAmerica Corp. 3.5%
General Electric Co. 3.4%
MCI Communications Corp. 3.2%
Tenneco Inc. 2.7%
Autodesk Inc. 2.7%
Amoco Corp. 2.6%
Chubb Corp. 2.6%
Leader Financial Corp. 2.6%
First Bank System, Inc. 2.6%
Columbia/HCA Healthcare Corp. 2.5%
---------------
Total 28.4%
---------------
---------------
</TABLE>
- --------------------------------------------------------------------------------
4
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1996
<TABLE>
<CAPTION>
COMMON STOCK - 97.3%
SHARES VALUE US$
------ ----------
<S> <C> <C>
BASIC MATERIALS - 3.5%
9,000 James River Corporation of
Virginia 240,750
12,000 LTV Corporation* 165,000
3,200 Raychem Corporation 249,200
-----------
654,950
-----------
CAPITAL GOODS/CONSTRUCTION - 12.2%
6,300 Allied-Signal, Inc. 366,187
7,900 General Electric Company 612,250
6,700 Rockwell International
Corporation 391,950
9,000 Tenneco, Inc. 493,876
4,000 Varity Corporation* 170,500
7,000 WMX Technologies, Incorporated 243,250
-----------
2,278,013
-----------
CONSUMER CYCLICALS - 12.2%
8,600 Goodyear Tire & Rubber Company 448,275
5,966 Home Depot, Inc. 282,638
10,400 La Quinta Inns, Incorporated 304,201
10,000 Rite Aid Corporation 296,250
12,400 Toys 'R' Us, Inc.* 345,650
5,000 Viacom, Inc., Class B* 205,000
16,200 Wal-Mart Stores, Inc. 386,775
-----------
2,268,789
-----------
CONSUMER STAPLES - 18.5%
7,000 Abbott Laboratories 284,375
8,500 Albertson's, Inc. 327,250
2,700 Cardinal Health, Inc. 169,425
4,100 Colgate-Palmolive Company 314,162
8,600 Columbia/HCA Healthcare
Corporation 456,875
8,400 Conagra, Inc. 324,450
5,500 Eckerd Corporation* 262,625
3,800 General Mills, Inc. 210,900
9,400 Invacare Corporation 244,400
7,500 Isis Pharmaceuticals,
Incorporated* 95,625
2,800 Johnson & Johnson 259,000
648 Lynx Therapeutics* 5,184
5,300 Pharmacia & Upjohn,
Incorporated 202,725
3,200 Philip Morris Companies,
Incorporated 288,400
-----------
3,445,396
-----------
ENERGY - 10.6%
6,000 Amerada Hess Corporation 339,750
6,500 Amoco Corporation 474,500
ENERGY (CONCLUDED)
5,300 Camco International,
Incorporated 188,813
3,300 Exxon Corporation 280,500
14,800 Flores & Rucks, Inc.* 308,950
6,000 Kerr-McGee Corporation 383,250
-----------
1,975,763
-----------
FINANCIAL - 14.5%
8,300 BankAmerica Corporation 628,725
5,000 Chubb Corporation 473,125
7,800 First Bank System,
Incorporated 469,950
10,700 Leader Financial Corporation 470,800
13,000 North Fork Bancorporation,
Inc. 308,750
5,800 Unum Corporation 345,100
-----------
2,696,450
-----------
TECHNOLOGY - 14.6%
12,000 Autodesk, Inc. 489,000
7,800 Automatic Data Processing,
Inc. 303,225
4,000 Cisco Systems, Inc.* 207,500
3,100 Intel Corporation 210,025
4,200 International Business
Machines Corporation 451,500
4,600 Linear Technology Corporation 158,125
6,000 LSI Logic Corporation* 216,000
27,000 Novell, Inc.* 391,500
5,000 Seagate Technology, Inc.* 290,000
-----------
2,716,875
-----------
<PAGE>
TRANSPORTATION/SERVICES/MISCELLANEOUS - 6.7%
2,300 AT&T Corporation 140,875
19,800 MCI Communications Corporation 582,862
3,600 Minnesota Mining &
Manufacturing Company 236,700
14,000 Redman Industries,
Incorporated* 281,750
-----------
1,242,187
-----------
UTILITIES - 4.5%
7,400 FPL Group, Incorporated 319,125
12,000 Northeast Utilities 190,500
6,800 SBC Communications, Inc. 340,000
-----------
849,625
-----------
Total Investments
(Cost $13,582,214) 97.3% 18,128,048
Other Assets, Net 2.7% 507,382
-----------
Total Net Assets 100.0% $18,635,430
-----------
-----------
</TABLE>
*Non-income producing security.
- --------------------------------------------------------------------------------
5
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1996
<TABLE>
<S> <C>
ASSETS:
Investments, at value (at cost, $13,582,214) (Note 1) $18,128,048
Cash and cash equivalents 677,899
Interest and dividends receivable 17,860
-----------
Total Assets 18,823,807
-----------
LIABILITIES:
Payable for securities purchased 146,068
Accrued advisory fees (Note 3) 11,528
Other payables and accrued expenses 30,781
-----------
Total Liabilities 188,377
-----------
Net Assets $18,635,430
-----------
-----------
NET ASSETS CONSIST OF:
Paid-in capital 11,889,745
Undistributed net investment income 17,539
Accumulated undistributed net realized gain on
investments 2,182,312
Net unrealized appreciation of investments 4,545,834
-----------
Net Assets $18,635,430
-----------
-----------
Net Asset Value price per share
($18,635,430 divided by 2,017,607
shares outstanding) $9.24
-----------
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
6
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1996
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends $ 174,103
Interest 18,997
----------
Total Income 193,100
----------
EXPENSES:
Investment advisory fees (Note 3) 72,911
Transfer agent fees and expenses (Note 3) 14,996
Custodian fees 3,910
Accounting service fees (Note 3) 18,000
Auditing fees 11,170
Other professional fees 1,258
Trustees fees and expenses 422
Other 13,618
----------
Total Expenses 136,285
----------
NET INVESTMENT INCOME 56,815
----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments 2,182,312
Change in unrealized appreciation of investments 186,652
----------
NET GAIN ON INVESTMENTS 2,368,964
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $2,425,779
----------
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
7
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS FOR THE YEAR
ENDED ENDED
APRIL 30, 1996 OCTOBER 31, 1995
------------------ ----------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment income $ 56,815 $ 147,286
Net realized gain on investments 2,182,312 2,561,493
Change in unrealized appreciation of
investments 186,652 372,019
------------------ ----------------
Net increase in net assets resulting from
operations 2,425,779 3,080,798
------------------ ----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (158,133) (107,944)
Net realized gain on investments (2,560,575) (993,082)
------------------ ----------------
Total distributions to shareholders (2,718,708) (1,101,026)
------------------ ----------------
DECREASE FROM CAPITAL SHARE TRANSACTIONS (NOTE 5) (759,332) (774,884)
------------------ ----------------
(DECREASE) INCREASE IN NET ASSETS (1,052,261) 1,204,888
NET ASSETS:
Beginning of period 19,687,691 18,482,803
------------------ ----------------
End of period $ 18,635,430 $ 19,687,691
------------------ ----------------
------------------ ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
8
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Schroder U.S. Equity Fund (the 'Fund') is a portfolio of Schroder
Capital Funds (Delaware) (the 'Trust'). The Fund is registered under the
Investment Company Act of 1940, as amended, as a diversified open-end
management investment company. The Fund's financial statements are prepared
in accordance with generally accepted accounting principles which permit
management to make certain estimates and assumptions at the date of the
financial statements and are based on the following significant accounting
policies.
SECURITY VALUATION
The value of securities traded on the New York Stock Exchange is based
on the last sale price, and the value of securities traded on any other
national stock exchange is based on the last sale price as of 4:00 p.m. in
New York as quoted by authoritative sources. In the absence of a recorded
sale, the average of the closing bid and asked prices is used. Securities
traded on other organized markets are valued at the average of the bid and
asked prices as of 4:00 p.m. in New York as available from authoritative
sources at the end of the business day.
SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are recorded on trade date. Dividend income is
recorded on the ex-dividend date. Interest income is recorded on an accrual
basis.
Realized gains and losses from security transactions are determined on
the basis of identified cost.
DISTRIBUTIONS TO SHAREHOLDERS
Distributions are recorded on the ex-dividend date. Income and capital
gain distributions are determined in accordance with Federal income tax
regulations which may differ from generally accepted accounting principles.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per share allocation between net investment income and realized or
unrealized gain or loss. Undistributed net investment income and accumulated
undistributed net realized gains or losses may include temporary book and tax
basis differences which will reverse in a subsequent period. Any taxable
income or gain remaining at fiscal year end is distributed in the following
year.
2. PURCHASES AND SALES OF SECURITIES:
The aggregate cost of securities purchased and the proceeds from sales
of securities or maturities for the six months ended April 30, 1996 were
$6,254,522 and $9,368,087, respectively.
- --------------------------------------------------------------------------------
9
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. RELATED PARTIES:
Remunerations to related parties were paid or accrued in the following
amounts:
<TABLE>
<CAPTION>
For The Six Months
Ended
April 30, 1996
- -------------------------------------------------------------------------------
<S> <C>
Schroder Capital Management International Inc.
(Investment Advisor) $ 72,911
Forum Financial Corp. (Fund Accountant and Transfer
Agent) 32,996
-----------
$105,907
-----------
-----------
</TABLE>
The advisory contract provides for an annual fee, payable monthly, of
3/4 of 1% on the first $100,000,000 of average daily net assets and 1/2 of 1%
on the average daily net assets in excess of $100,000,000.
Forum Financial Corp. serves as the Fund's transfer agent and dividend
disbursing agent and is compensated for those services by the Fund in the
amount of $12,000 per year plus certain shareholder account fees. Forum
Financial Corp. also performs portfolio accounting for the Fund and is
compensated for those services by the Fund in the amount of $36,000 per year,
plus certain amounts based upon the number and types of portfolio
transactions.
4. FEDERAL INCOME TAXES:
Since 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 to its shareholders, no Federal income
tax provision is required.
5. CAPITAL SHARES:
The Fund is authorized under the Trust's Trust Instrument to issue an
unlimited number of shares of beneficial interest without par value. At April
30, 1996, the Fund had 2,017,607 shares outstanding. Transactions in the
Fund's capital shares for the six months ended April 30, 1996 and the year
ended October 31, 1995 were as follows:
<TABLE>
<CAPTION>
Six Months Ended April 30, Year Ended October 31,
1996 1995
- ---------------------------------------------------------------------------------------------------------------
Number Number
of of
Shares Amount Shares Amount
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares subscribed 11,376 $ 103,319 10,529 $ 90,404
Shares issued for dividend reinvestment 207,563 1,811,255 111,954 866,525
--------- ----------- --------- -----------
218,939 1,914,574 122,483 956,929
Shares redeemed (293,336) (2,673,906) (199,081) (1,731,813)
--------- ----------- --------- -----------
Net decrease in outstanding shares (74,397) $ (759,332) (76,598) $ (774,884)
--------- ----------- --------- -----------
--------- ----------- --------- -----------
</TABLE>
- --------------------------------------------------------------------------------
10
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. EQUITY FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
6. APPRECIATION OF INVESTMENTS:
As of April 30, 1996, the aggregate cost of investment securities for
Federal income tax purposes was $13,582,214 and the gross unrealized
appreciation (depreciation) of investments was as follows:
<TABLE>
<S> <C>
Gross unrealized appreciation $4,843,947
Gross unrealized depreciation (298,113)
----------
Net unrealized appreciation $4,545,834
----------
----------
</TABLE>
7. FINANCIAL HIGHLIGHTS:
Selected Per share Data and Ratios
<TABLE>
<CAPTION>
For the Six Months
Ended For The Years Ended October 31,
April 30, 1996 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------
Net Asset Value, beginning of
period $ 9.41 $ 8.52 $ 11.28 $ 10.51 $ 9.56 $ 7.05
---------- ------- ------- ------- ------- -------
Investment Operations:
Net investment income 0.04 0.07 0.04 0.05 0.02 0.09
Net realized and unrealized gain
(loss) on investments 1.10 1.33 (0.27) 1.86 1.61 2.57
---------- ------- ------- ------- ------- -------
Total from investment operations 1.14 1.40 (0.23) 1.91 1.63 2.66
---------- ------- ------- ------- ------- -------
Distributions From:
Net investment income (0.07) (0.05) (0.01) (0.04) (0.04) (0.11)
Realized capital gains (1.24) (0.46) (2.52) (1.10) (0.58) --
Capital paid-in -- -- -- -- (0.06) (0.04)
---------- ------- ------- ------- ------- -------
Total distributions (1.31) (0.51) (2.53) (1.14) (0.68) (0.15)
---------- ------- ------- ------- ------- -------
Net Asset Value, end of period $ 9.24 $ 9.41 $ 8.52 $ 11.28 $ 10.51 $ 9.56
---------- ------- ------- ------- ------- -------
---------- ------- ------- ------- ------- -------
Total Return 13.08% 17.68% (2.01)% 19.49% 17.74% 38.16%
---------- ------- ------- ------- ------- -------
---------- ------- ------- ------- ------- -------
Ratios/Supplementary Data:
Net Assets, end of period
(thousands) $ 18,635 $19,688 $18,483 $21,865 $19,882 $20,234
Ratio of expenses to average net
assets 1.40%(a) 1.40% 1.31% 1.18% 1.40% 1.39%
Ratio of net investment income to
average net assets 0.58%(a) 0.78% 0.41% 0.51% 0.42% 1.30%
Portfolio turnover rate 33.90% 57.21% 27.43% 57.78% 31.33% 29.98%
Average brokerage commission rate $0.0410(b)
</TABLE>
- ------------
(a) Annualized.
(b) Amount represents the average commission per share paid to brokers on the
purchase and sale of portfolio securities.
- --------------------------------------------------------------------------------
11
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<PAGE>
<PAGE>
TRUSTEES
Laura E. Luckyn-Malone
Hermann C. Schwab
Peter E. Guernsey
Ralph E. Hansman (Honorary)
John I. Howell
Clarence F. Michalis
Mark J. Smith
OFFICERS
Hermann C. Schwab
Chairman of the Board
Laura E. Luckyn-Malone
President
John Troiano
Vice President
Mark J. Smith
Vice President
Robert G. Davy
Vice President
Richard Foulkes
Vice President
Fariba Talebi
Vice President
Ira L. Unschuld
Vice President
John Y. Keffer
Vice President
Jane Lucas
Vice President
Catherine A. Mazza
Vice President
Robert Jackowitz
Treasurer
Thomas G. Sheehan
Assistant Treasurer
Assistant Secretary
David I. Goldstein
Assistant Treasurer
Assistant Secretary
Margaret H. Douglas-Hamilton
Secretary
Gerardo Machado
Assistant Secretary
Barbara Gottlieb
Assistant Secretary
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
INVESTMENT ADVISER
Schroder Capital Management International Inc.
787 Seventh Avenue
New York, New York 10019
ADMINISTRATOR & DISTRIBUTOR
Schroder Fund Advisors Inc.
787 Seventh Avenue
New York, New York 10019
CUSTODIAN
The Chase Manhattan Bank, N.A.
Chase MetroTech Center
Brooklyn, New York 11245
TRANSFER AND DIVIDEND DISBURSING AGENT
Forum Financial Corp.
Two Portland Square
Portland, Maine 04101
COUNSEL
Jacobs Persinger & Parker
77 Water Street
New York, New York 10005
INDEPENDENT AUDITORS
Coopers & Lybrand L.L.P.
One Post Office Square
Boston, Massachusetts 02109
This report is for the information of the shareholders
of the Schroder U.S. Equity Fund. Its use in connection
with any offering of the Fund's shares is authorized only
in case of a concurrent or prior delivery of the Fund's
current prospectus.
[Logo]
Schroder
U.S. Equity
Fund
SEMI-ANNUAL REPORT
April 30, 1996
(Unaudited)
Schroder Capital Funds
(Delaware)
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
Two Portland Square, Portland, Maine 04101
<TABLE>
<S> <C>
General Information (207) 879-8903
Account Information (800) 344-8332
Fund Literature (800) 290-9826
Fax (800) 879-6206
</TABLE>
INVESTMENT OBJECTIVE
Capital appreciation through investments in a diversified portfolio which under
normal conditions will have at least 65% of its total assets invested in equity
securities of companies having market capitalizations under $1 billion.
INVESTMENT MANAGER
Schroder Capital Management International Inc. (the 'SCMI') is a wholly-owned
indirect subsidiary of Schroders plc, a publicly owned company organized under
the laws of England. Schroders plc is the holding company parent of a large
world-wide group of banks and financial services companies (the 'Schroder
Group') that dates its origins to 1804. The investment management subsidiaries
of the Schroder Group had, as of December 31, 1995, assets under management in
excess of $100 billion. As of that same date, SCMI, together with its U.K.
affiliate, Schroder Capital Management International Ltd., had over $17 billion
under management.
June 15, 1996
Dear Shareholder:
We are pleased to report that the Schroder U.S. Smaller Companies Fund is
continuing its strong performance over the first half of the current fiscal
year. On April 30, 1996, the end of the Fund's semi-annual period, the Fund's
net assets were $14,901,001 and the net asset value per share was $16.82. For
the same six month period, the Fund registered a return of 26.3% comparing
favorably with a rise of 18.4% for the Russell 2000. Since inception on August
6, 1993, the Fund has appreciated by 99.7% as compared to 53.7% for the Russell
2000.
On the economic front, in late 1995 and early this year, conventional
wisdom was that the U.S. economy was teetering on the brink of recession, that
the Federal Reserve would be easing monetary policy in an aggressive manner
throughout 1996, and that inflation would be flat to down vis-a-vis 1995. Harsh
weather and several government shutdowns exacerbated the economy's problems over
the winter, adding to the general atmosphere of gloom and doom. Our view during
this whole episode was that the inventory excess was mild and that the
adjustment process would thus not be sufficient to tip the economy into
recession. Furthermore, bad weather and government shutdowns were simply
temporary hurdles for the economy that would be unlikely to have a lasting
impact. Events such as a successful inventory adjustment, stronger job growth
and a continued solid expansion in final demand, now seem to have vindicated our
view (which was out of favor for a few months).
Although consensus expectations have risen in response to these recent
signs of strength in the economy, we believe that the economy still has more
upside potential in 1996 than most believe. We are looking for an average of
3.5% real GDP growth in the middle two quarters of the year, which is more than
one-half of one percentage point above consensus surveys taken in mid-June. We
also expect inflation to edge up in the months ahead due to the impact of above
trend growth against a backdrop of an economy already bumping up against
capacity
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
constraints. In order to head off a potentially significant rise in inflation,
the Federal Reserve is likely sometime this summer to begin to tighten monetary
policy. The ultimate extent of monetary tightening is not anticipated to be
severe, perhaps being limited to reversing the 75 basis points of easing which
was implemented over the course of the second half of 1995 and very early this
year.
We thank you for your continued support and interest in the Fund.
Sincerely,
<TABLE>
<S> <C>
/s/ HERMANN C. SCHWAB /s/ LAURA E. LUCKYN-MALONE
Hermann C. Schwab Laura E. Luckyn-Malone
Chairman President
</TABLE>
- --------------------------------------------------------------------------------
2
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
PORTFOLIO STRATEGY (AS OF APRIL 30, 1996)
Smaller companies outperformed larger ones during the six month timeframe,
though that outperformance occurred in the latter part of the period, namely
March and April 1996. The best performing sector was energy, benefiting from a
rise in oil and gas prices. We had added to our energy holdings early in fiscal
1996, due to low valuations and improved risk-reward for the sector. Performance
therefore benefited from both an overweight position and successful stock
picking. Holdings which performed particularly well included Flores & Rucks,
Inc., Camco International, Inc., and Cooper Cameron Corp. We continue to find
interesting opportunities in this sector, recently purchasing Seacor Holdings,
an operator of supply boats in the Gulf of Mexico.
Technology stocks, which had been bid up early in 1995, were weak early in
the period on profit taking and concerns over declining prices in the
semi-conductor industry. The sector has continued to have volatile performance,
with strong returns in April and May and weaker results thus far in June. We
have had a cautious stance toward this sector, avoiding institutional favorites
and maintaining an underweight position. However, we look forward to taking
advantage of further weakness in the technology sector to opportunistically add
to our positions. We recently added MicroTouch Systems, Inc., a leading
manufacturer of high end touch computer screens.
Improving same store sales have helped retailers to outperform the market
so far in 1996. This is in marked contrast to 1995 when sales were poor and
retailers were one of the worst performing sectors in the market. However, we
remain cautious on retailers and have maintained a limited exposure in the
sector, but have focused on leading companies in alternative channels of
distribution such as direct mail. An example of a recent purchase is CDW
Computer Centers, a direct mail retailer of micro-computers, which is extremely
efficient and profitable, growing at a rapid pace, and taking market share from
other channels. We also took advantage of a trend in outsourcing, on which we
capitalized through investments in Accustaff, Inc. and Career Horizons, Inc. In
communications, we see continued growth in the radio industry and have added
positions in Heritage Media Corporation and Jacor Communications, Inc., two well
diversified companies, both of which have incentivized management and
significant free cash flow.
Looking forward, we continue to search for companies that can grow their
earnings independently of the economic cycle. Our investment criteria of growth
at a reasonable price remains ever important as we see many institutional
favorites with high valuations. We will remain focused on our research-intensive
individual stock selection, concentrating on underfollowed and misunderstood
companies which can offer superior earnings growth. While it is difficult to say
how the overall market will perform in the remainder of 1996, we remain
optimistic about the potential for smaller companies.
The views expressed in this report were those of the Funds' portfolio
managers as of the dates specified, and may not reflect the views of the
portfolio managers on the date this report is first published or at any time
thereafter. These views are intended to assist shareholders of the Funds in
understanding their investments in the Funds and do not constitute investment
advice; investors should consult their own investment professionals as to their
individual investment programs.
- --------------------------------------------------------------------------------
3
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF APRIL 30, 1996
<TABLE>
<CAPTION>
INVESTMENT BY INDUSTRY
INDUSTRY % OF NET ASSETS
- --------------------------------------------------------
<S> <C>
Basic Materials 4.5%
Capital Goods/Construction 5.9%
Consumer Cyclicals 24.3%
Consumer Staples 3.1%
Energy 11.2%
Financial 14.5%
Healthcare 13.4%
Technology 16.6%
Transportation/Services/
Miscellaneous 5.8%
Cash and Other Net Assets 0.7%
---------------
Total 100.0%
---------------
---------------
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
SECURITY % OF PORTFOLIO
- --------------------------------------------------------
<S> <C>
Sykes Enterprises, Inc. 2.4%
Career Horizons, Inc. 2.4%
Amphenol Corp. 1.8%
Leader Financial Corp. 1.8%
Cadence Design Systems, Inc. 1.8%
Performance Food Group Company 1.7%
Louisiana Land & Exploration Co. 1.7%
Quiksilver Inc. 1.7%
Computervision Corp. 1.6%
Redman Industries, Inc. 1.6%
---------------
Total 18.5%
---------------
---------------
</TABLE>
- --------------------------------------------------------------------------------
4
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
APRIL 30, 1996
<TABLE>
<CAPTION>
COMMON STOCK - 99.3%
SHARES VALUE US$
---------- -----------
<S> <C> <C>
BASIC MATERIALS - 4.5%
7,000 AMCOL International
Corporation 81,374
11,800 Calgon Carbon Corporation 147,500
5,400 Ferro Corporation 149,850
6,700 Quanex Corporation 147,400
8,400 U.S. Can Corporation* 143,850
-----------
669,974
-----------
CAPITAL GOODS/CONSTRUCTION - 5.9%
16,666 Continental Waste Industries,
Inc.* 199,991
6,000 Donaldson Company, Inc. 157,500
3,000 Harsco Corporation 206,625
4,700 Kirby Corporation* 82,837
5,000 Larson Davis Incorporated* 31,250
3,600 U.S.A. Waste Services Inc. 93,600
2,500 Varity Corporation* 106,562
-----------
878,365
-----------
CONSUMER CYCLICALS - 24.3%
3,500 Accustaff, Inc.* 104,125
10,000 Career Horizons, Inc.* 352,500
2,100 CDW Computer Centers, Inc.* 162,487
5,700 Consolidated Stores
Corporation* 205,200
6,500 Daka International
Incorporated* 197,437
5,800 Finlay Enterprises, Inc.* 85,550
3,150 Harman International
Industries, Inc. 148,837
3,400 HFS Incorporated* 174,675
8,000 Interface Inc. 104,000
6,962 La Quinta Inns, Incorporated 203,638
3,250 Nautica Enterprises* 151,125
2,500 Penske Motorsports, Inc.* 75,625
9,000 Performance Food Group
Company* 257,625
6,900 Petco Animal Supplies, Inc.* 198,375
6,500 Quiksilver Inc.* 247,000
5,900 Regal Cinemas Incorporated* 240,425
3,000 Scientific Games Holdings
Corporation* 98,250
8,250 Sonic Corporation* 156,750
3,600 Viking Office Products, Inc.* 213,750
7,000 Warnaco Group, Inc., Class A 183,750
3,100 WestPoint Stevens, Inc.* 65,100
-----------
3,626,224
-----------
CONSUMER STAPLES - 3.1%
3,600 Compdent Corporation* 159,300
4,000 Eckerd Corporation* 191,000
6,000 General Nutrition Companies* 117,000
-----------
467,300
-----------
ENERGY - 11.2%
6,000 Camco International,
Incorporated 213,750
4,400 Cooper Cameron Corporation* 198,549
6,800 Flores & Rucks, Inc.* 141,951
4,000 Input/Output, Inc.* 139,000
4,600 Louisiana Land & Exploration
Company 248,975
5,400 Phoenix Resource Companies
Inc. 137,700
1,700 Seacor Holdings* 70,125
9,000 Texas Meridian Resources
Corporation* 94,500
3,100 Tosco Corporation 165,850
3,000 Ultramar Corporation 94,125
8,300 Union Tex Pete Holdings Inc. 160,812
-----------
1,665,337
-----------
FINANCIAL - 14.5%
3,000 Allmerica Financial
Corporation 78,000
1,900 Astoria Financial Corporation 101,175
6,200 Charter One Financial, Inc. 216,225
3,000 Commercial Federal Corporation 115,125
3,800 Compass Bancshares
Incorporated 127,300
2,900 Cullen/Frost Bankers, Inc. 142,825
4,500 First Commerce Corporation* 153,000
6,000 Leader Financial Corporation 264,000
7,000 MLF Bancorp, Inc. 168,875
9,300 North Fork Bancorporation,
Inc. 220,875
4,500 Penncorp Financial Group,
Incorporated 137,812
2,100 Robert Half International,
Incorporated* 120,750
5,100 Titans Holdings, Inc. 70,763
3,300 U.S. Facilities Corporation 60,637
6,000 Union Planters Corporation 180,751
-----------
2,158,113
-----------
HEALTHCARE - 13.4%
7,000 Bergen Brunswig Corporation 190,751
8,000 Community Psychiatric Centers* 74,000
2,900 CONMED Corporation* 86,275
6,000 Coventry Corporation* 116,250
2,100 Genzyme Corporation* 118,125
8,000 Haemonetics Corporation* 154,000
11,062 Healthdyne Technologies Inc.* 141,041
5,600 Invacare Corporation 145,600
11,900 Isis Pharmaceuticals,
Incorporated* 151,725
17,000 Matria Healthcare, Inc.* 129,625
6,500 Multicare Companies Inc.* 184,438
2,000 Nellcor Puritan Bennett,
Incorporated* 98,000
2,000 Omnicare, Inc. 120,000
4,100 ProNet, Incorporated* 129,664
</TABLE>
- --------------------------------------------------------------------------------
5
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
APRIL 30, 1996
<TABLE>
<CAPTION>
COMMON STOCK
SHARES VALUE US$
---------- -----------
<S> <C> <C>
HEALTHCARE (CONCLUDED)
1,200 Shared Medical Systems
Corporation 82,200
7,500 Sullivan Dental Products, Inc. 83,438
-----------
2,005,132
-----------
TECHNOLOGY - 16.6%
10,300 Amphenol Corporation* 271,662
4,000 Andros Inc.* 71,000
5,050 Cadence Design Systems,
Incorporated* 263,862
20,100 Computervision Corporation* 243,713
7,500 Data Processing Resources
Corporation* 189,375
700 Day Runner, Inc. 21,787
10,000 EG&G, Inc. 220,000
6,300 Exabyte Corporation* 110,250
4,500 Intergraph Corporation* 57,093
6,000 Marcam Corporation* 69,000
5,700 MicroTouch Systems, Inc.* 104,738
10,000 Sykes Enterprises, Inc. 355,000
5,700 System Software Associates,
Incorporated 136,088
TECHNOLOGY (CONCLUDED)
3,000 Thomas & Betts Corporation 118,125
10,000 Wang Laboratories Incorporated* 236,876
-----------
2,468,569
-----------
TRANSPORTATION/SERVICES/MISCELLANEOUS - 5.8%
7,400 Atlantic Southeast Airlines,
Incorporated 185,000
3,000 Barnett, Inc.* 70,500
2,500 Heritage Media Corporation* 95,938
3,700 Jacor Communications, Inc. 80,475
4,400 Mid-America Apartment
Communities, Incorporated 116,050
12,000 Redman Industries,
Incorporated* 241,500
4,900 Skywest Incorporated 72,888
-----------
862,351
-----------
Total Investments
(Cost $10,039,973) 99.3% 14,801,365
Other Assets, Net 0.7% 99,636
-----------
Total Net Assets 100.0% 14,901,001
-----------
-----------
</TABLE>
* Non-income producing security.
- --------------------------------------------------------------------------------
6
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1996
<TABLE>
<S> <C>
ASSETS:
Investments, at value (at cost, $10,039,973) (Note 1) $14,801,365
Cash and cash equivalents 77,904
Receivable for securities sold 726,267
Interest and dividends receivable 5,486
Deferred organization costs, net 12,936
-----------
Total Assets 15,623,958
-----------
LIABILITIES:
Payable for securities purchased 694,978
Accrued advisory fees (Note 3) 5,860
Accrued administration fees (Note 3) 2,930
Other payables and accrued expenses 19,189
-----------
Total Liabilities 722,957
-----------
Net Assets $14,901,001
-----------
-----------
NET ASSETS CONSIST OF:
Paid-in capital 7,800,621
Undistributed net investment loss (10,806)
Accumulated undistributed net realized gain on investments 2,349,794
Net unrealized appreciation of investments 4,761,392
-----------
Net Assets $14,901,001
-----------
-----------
Net Asset Value price per share
($14,901,001 divided by 885,775 shares
outstanding) $16.82
-----------
-----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
7
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1996
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends $ 81,867
Interest 8,965
----------
Total Income 90,832
----------
EXPENSES:
Investment advisory fees (Note 3) 37,183
Administration fees (Note 3) 18,592
Transfer agent fees and expenses (Note 3) 6,190
Custodian fees 2,039
Accounting service fees (Note 3) 19,000
Auditing fees 6,500
Other professional fees 980
Trustees fees and expenses 326
Other 7,933
Amortization of organization costs 2,895
----------
Total Expenses 101,638
----------
NET INVESTMENT LOSS (10,806)
----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments 2,392,607
Change in unrealized appreciation of investments 1,084,464
----------
NET GAIN ON INVESTMENTS 3,477,071
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $3,466,265
----------
----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
8
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
APRIL 30, 1996 OCTOBER 31, 1995
-------------- ----------------
<S> <C> <C>
INCREASE IN NET ASSETS:
OPERATIONS:
Net investment loss $ (10,806) $ (42,343)
Net realized gain on investments 2,392,607 1,960,897
Change in unrealized appreciation of
investments 1,084,464 2,234,952
-------------- ----------------
Net increase in net assets resulting from
operations 3,466,265 4,153,506
DISTRIBUTIONS TO SHAREHOLDERS FROM
NET REALIZED GAIN ON INVESTMENTS (1,965,720) (458,547)
DECREASE FROM CAPITAL SHARE TRANSACTIONS (NOTE 5) (1,886,760) (1,731,532)
-------------- ----------------
(DECREASE) INCREASE IN NET ASSETS (386,215) 1,963,427
NET ASSETS:
Beginning of period 15,287,216 13,323,789
-------------- ----------------
End of period $ 14,901,001 $ 15,287,216
-------------- ----------------
-------------- ----------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
9
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Schroder U.S. Smaller Companies Fund (the 'Fund') is a portfolio of
Schroder Capital Funds (Delaware) (the 'Trust'). The Fund is registered under
the Investment Company Act of 1940, as amended, as a diversified open-end
management investment company. The Fund's financial statements are prepared
in accordance with generally accepted accounting principles which permit
management to make certain estimates and assumptions at the date of the
financial statements and are based on the following significant accounting
policies.
SECURITY VALUATION
The value of securities traded on the New York Stock Exchange is based
on the last sale price, and the value of securities traded on any other
national stock exchange is based on the last sale price as of 4:00 p.m. in
New York as quoted by authoritative sources. In the absence of a recorded
sale, the average of the closing bid and asked prices is used. Securities
traded on other organized markets are valued at the average of the bid and
asked prices as of 4:00 p.m. in New York as available from authoritative
sources at the end of the business day.
SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are recorded on trade date. Dividend income is
recorded on the ex-dividend date. Interest income is recorded on an accrual
basis.
Realized gains and losses from security transactions are determined on
the basis of identified cost.
ORGANIZATIONAL COSTS
Costs incurred by the Fund in connection with its organization and
initial registration are being amortized on a straight line basis over a
five-year period.
DISTRIBUTIONS TO SHAREHOLDERS
Distributions are recorded on the ex-dividend date. Income and capital
gain distributions are determined in accordance with Federal income tax
regulations which may differ from generally accepted accounting principles.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per share allocation between net investment income and realized or
unrealized gain or loss. Undistributed net investment income and accumulated
undistributed net realized gains or losses may include temporary book and tax
basis differences, primarily due to wash sales, which will reverse in a
subsequent period. Any taxable income or gain remaining at fiscal year end is
distributed in the following year.
2. PURCHASES AND SALES OF SECURITIES:
The aggregate cost of securities purchased and the proceeds from sales
of securities or maturities for the six months ended April 30, 1996 were
$4,599,081 and $8,003,131, respectively.
- --------------------------------------------------------------------------------
10
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. RELATED PARTIES:
Remunerations to related parties were paid or accrued in the following
amounts:
<TABLE>
<CAPTION>
For The Six Months Ended
April 30, 1996
- -------------------------------------------------------------------------
<S> <C>
Schroder Capital Management International Inc.
(Investment Adviser) $ 37,183
Schroder Fund Advisors Inc. (Administrator) 18,592
Forum Financial Corp. (Fund Accountant and
Transfer Agent) 25,190
----------
$ 80,965
----------
----------
</TABLE>
The advisory contract provides for an annual fee, payable monthly, of
1/2 of 1% on the first $100,000,000 of average daily net assets, 2/5 of 1% on
the next $150,000,000 of average daily net assets and 7/20 of 1% on average
daily net assets in excess of $250,000,000.
The administrative services contract provides for an annual fee,
payable monthly, of 1/4 of 1% on the first $100,000,000 of average daily net
assets, 1/5 of 1% on the next $150,000,000 of average daily net assets and
7/40 of 1% on average daily net assets in excess of $250,000,000.
Forum Financial Corp. serves as the Fund's transfer agent and dividend
disbursing agent and is compensated for those services by the Fund in the
amount of $12,000 per year plus certain shareholder account fees. Forum
Financial Corp. also performs portfolio accounting for the Fund and is
compensated for those services by the Fund in the amount of $36,000 per year
plus, for each class of the Fund above one, $12,000 per year, plus certain
amounts based upon the number and types of portfolio transactions.
4. FEDERAL INCOME TAXES:
Since 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 to its shareholders, no Federal income
tax provision is required.
- --------------------------------------------------------------------------------
11
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
5. CAPITAL SHARES:
The Fund is authorized under the Trust's Trust Instrument to issue an
unlimited number of shares of beneficial interest without par value. At April
30, 1996, the Fund had 885,775 shares outstanding. Transactions in the Fund's
capital shares for the six months ended April 30, 1996 and the year ended
October 31, 1995 were as follows:
<TABLE>
<CAPTION>
Six Months Ended April 30, Year Ended October 31,
1996 1995
- ---------------------------------------------------------------------------------------------------------------
Number Number
of of
Shares Amount Shares Amount
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares subscribed 1,138 $ 17,500 169 $ 2,000
Shares issued for dividend reinvestment 106,834 1,522,389 37,357 410,171
--------- ----------- --------- -----------
107,972 1,539,889 37,526 412,171
Shares redeemed (231,760) (3,426,649) (156,000) (2,143,703)
--------- ----------- --------- -----------
Net decrease in outstanding shares (123,788) $(1,886,760) (118,474) $(1,731,532)
--------- ----------- --------- -----------
--------- ----------- --------- -----------
</TABLE>
6. APPRECIATION OF INVESTMENTS:
As of April 30, 1996, the aggregate cost of investment securities for
Federal income tax purposes was $10,044,269 and the gross unrealized
appreciation (depreciation) of investments was as follows:
<TABLE>
<S> <C>
Gross unrealized appreciation $4,949,148
Gross unrealized depreciation (192,052)
----------
Net unrealized appreciation $4,757,096
----------
----------
</TABLE>
- --------------------------------------------------------------------------------
12
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALLER COMPANIES FUND
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
7. FINANCIAL HIGHLIGHTS:
Selected Per share Data and Ratios
<TABLE>
<CAPTION>
For the For the Years
Six Months Ended For the Period
Ended October 31, August 6, 1993(a)-
April 30, 1996 1995 1994 October 31, 1993
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Asset Value, beginning of period $ 15.14 $ 11.81 $ 10.99 $ 10.00
-------- ------- -------- --------
Investment operations:
Net investment loss (0.01) (0.04) (0.07) (0.02)
Net realized and unrealized gain on
investments 3.64 3.78 0.97 1.01
-------- ------- -------- --------
Total from investment operations 3.63 3.74 0.90 0.99
Distributions from realized capital gains (1.95) (0.41) (0.08) --
-------- ------- -------- --------
Net Asset Value, end of period $ 16.82 $ 15.14 $ 11.81 $ 10.99
-------- ------- -------- --------
-------- ------- -------- --------
Total Return 26.28% 32.84% 8.26% 9.90%
-------- ------- -------- --------
-------- ------- -------- --------
Ratios/Supplementary Data:
Net Assets, end of period (thousands) $ 14,901 $15,287 $13,324 $ 12,489
Ratio of expenses to average net assets 1.36%(b) 1.49% 1.45% 2.03%(b)
Ratio of net investment loss to average net
assets (0.14)%(b) (0.30)% (0.58)% (0.99)%(b)
Portfolio turnover rate 31.51% 92.68% 70.82% 12.58%
Average brokerage commission rate $ 0.0180 (c)
</TABLE>
(a) Commencement of operations.
(b) Annualized.
(c) Amount represents the average commission per share paid to brokers on the
purchase and sale of portfolio securities.
8. SUBSEQUENT EVENT:
Effective May 17, 1996 the Fund began offering two classes of shares,
Investor Shares and Advisor Shares. Investor Shares are offered for sale at
net asset value as an investment vehicle for individuals, institutions,
corporations and fiduciaries. Advisor Shares are offered for sale at net
asset value to individual investors primarily through banks, trust companies,
broker-dealers or other financial organizations and incur higher expenses
than Investors Shares. On May 17, 1996, all existing shares of the Fund were
converted to Investor Shares.
- --------------------------------------------------------------------------------
13
<PAGE>
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
<PAGE>
TRUSTEES
Laura E. Luckyn-Malone
Hermann C. Schwab
Peter E. Guernsey
Ralph E. Hansmann (Honorary)
John I. Howell
Clarence F. Michalis
Mark J. Smith
OFFICERS
Hermann C. Schwab
Chairman of the Board
Laura E. Luckyn-Malone
President
John Troiano
Vice President
Mark J. Smith
Vice President
Robert G. Davy
Vice President
Richard Foulkes
Vice President
Fariba Talebi
Vice President
Ira L. Unschuld
Vice President
John Y. Keffer
Vice President
Jane Lucas
Vice President
Catherine A. Mazza
Vice President
Robert Jackowitz
Treasurer
Thomas G. Sheehan
Assistant Treasurer
Assistant Secretary
David I. Goldstein
Assistant Treasurer
Assistant Secretary
Margaret H. Douglas-Hamilton
Secretary
Gerardo Machado
Assistant Secretary
Barbara Gottlieb
Assistant Secretary
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
INVESTMENT ADVISER
Schroder Capital Management International Inc.
787 Seventh Avenue
New York, New York 10019
ADMINISTRATOR & DISTRIBUTOR
Schroder Fund Advisors Inc.
787 Seventh Avenue
New York, New York 10019
CUSTODIAN
The Chase Manhattan Bank, N.A.
Chase MetroTech Center
Brooklyn, New York 11245
TRANSFER AND DIVIDEND DISBURSING AGENT
Forum Financial Corp.
Two Portland Square
Portland, Maine 04101
COUNSEL
Jacobs Persinger & Parker
77 Water Street
New York, New York 10005
INDEPENDENT AUDITORS
Coopers & Lybrand L.L.P.
One Post Office Square
Boston, Massachusetts 02109
This report is for the information of the shareholders
of the Schroder U.S. Smaller Companies Fund. Its use
in connection with any offering of the Fund's shares is
authorized only in case of a concurrent or prior deliv-
ery of the Fund's current prospectus.
[Logo]
Schroder
U.S. Smaller
Companies
Fund
SEMI-ANNUAL REPORT
April 30, 1996
(Unaudited)
Schroder Capital Funds
(Delaware)
<PAGE>
