<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The investment objective of the Fund is to seek long-term capital
appreciation.
INVESTMENT ADVISER
Schroder Capital Management International Inc. (the "Investment Adviser")
is a wholly owned indirect subsidiary of Schroder plc, the London Stock Exchange
listed holding company parent of an investment banking and investment management
group of companies (the "Schroder Group") that dates its origins to 1804. The
investment management operations of the Schroder Group are located in
22 countries worldwide. As of December 31, 1998, the Schroder Group had over
$195 billion in assets under management. As of March 31, 1999, the Investment
Adviser, together with its U.K. affiliate, Schroder Capital Management
International Ltd., had approximately $28 billion under management.
June 3, 1999
Dear Shareholder:
We are pleased to present the semi-annual report for the Schroder U.S.
Diversified Growth Fund for the six months ended April 30, 1999. In the past six
months, concerns that affected U.S. financial markets in the fall of 1998,
including banking sector difficulties and credit risk elsewhere in the world,
quickly dissipated. The U.S. economy proved very resilient and, as the period
progressed, expectations for both GDP and corporate earnings growth increased.
Gains in productivity accompanied this economic growth and helped to limit
inflationary pressures. The equity market reacted favorably to these
developments, rising strongly over the period. While the largest companies
dominated the rally, in the last few months there were indications of a more
broad-based move as smaller and medium-sized companies started to recover some
ground. The Treasury bond market was relatively weak, as yields rose sharply due
to concerns about increasing inflation in the future. However, corporate,
mortgage and asset-backed bonds, which had fallen dramatically during last
year's credit scare, fared better than Treasuries as investors' fears diminished
and credit spreads narrowed.
Looking ahead, we believe that U.S. interest rates are likely to increase
which would tend to produce volatility in the stock markets. We expect that
investors will pay increasing attention to securities' valuations as well as to
their growth prospects as these trends emerge. We are encouraged by the
long-term structural shifts in the U.S. economy and believe that Schroders is
well placed to identify both attractively positioned and attractively valued
investment opportunities.
Since your last report, Mark Smith has resigned as President and Chairman
of the Fund. As you may already know, Schroder Capital Management International
Inc. will be merging into a newly created corporation called Schroder Investment
Management North America Inc. This change will allow us to simplify our
corporate structure and to integrate our international and domestic equity and
fixed income management services for U.S. clients into one corporate entity. We
can assure you that no changes in Fund management are planned or anticipated in
connection with the merger. We expect the merger to be effective on or about
July 1, 1999. Thank you for your interest in the Schroder U.S. Diversified
Growth Fund.
Sincerely,
/s/ Nancy A. Curtin /s/ Alexandra Poe
- -------------------- -----------------
Nancy A. Curtin Alexandra Poe
Chairman President
- --------------------------------------------------------------------------------
1
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (As of April 30, 1999) (unaudited)
HOW DID THE FUND PERFORM FOR THE SIX MONTHS ENDED APRIL 30, 1999?
For the six months ended April 30, 1999 the U.S. Diversified Growth Fund's
Investor Shares returned 21.80%. Its benchmark, the S&P 500 Index, returned
22.30% over the same period.
WHAT FACTORS DOMINATED THE MARKET OVER THE PERIOD AND HOW WAS THE FUND
POSITIONED TO TAKE ADVANTAGE OF THESE FACTORS?
The U.S. equity market continued to advance to higher levels in the last
quarter of 1998 and the first quarter of 1999, with the broad large cap indices
all moving higher. Technology outperformed all other sectors and the market
continued to reward the largest, most liquid stocks. During the first quarter of
1999, the market moved away from the top quality, blue chip companies, towards
small cap and cyclical stocks, as stable inflation and a stronger-than-expected
economy boosted investor confidence and fears of the Brazilian crisis affecting
the U.S. equity market gradually diminished. The Fund is diversified across
economic sectors. Sector allocation was the principal factor contributing to
performance over the period. In particular, the Fund's overweight position in
technology boosted returns, as "internet fever" gathered pace. Stock selection
in this sector significantly contributed to performance. However, our overall
stock selection for the Fund detracted from performance. The Fund's focus on
mid-size stocks detracted from performance over the period, because the market
rewarded the largest, most liquid stocks or smaller stocks for most of the
period.
HOW IS THE FUND POSITIONED GOING FORWARD?
At the end of the period, the Fund was overweight in consumer cyclicals,
financials, and technology. Within the financial sector, we favored financial
services due to their low valuations and the growing demand for these types of
companies. The Fund's consumer cyclical holdings delivered strong gains over the
period and are all quality companies with strong fundamentals. The Fund is
underweight in the basic materials, capital goods, communication services,
consumer staples and energy sectors, where prospects for growth are less
certain.
OVERALL, FOR THE PAST 20 MONTHS, U.S. LARGE CAPS HAVE OUTPERFORMED ALL OTHER
ASSET CLASSES. DO YOU THINK THAT THIS IS SUSTAINABLE?
U.S. large caps continue to have many excellent fundamental attributes,
including world-class products and management, economies of scale, and the
potential for higher relative returns on investment. Over the last year, a huge
valuation gap has developed between large caps and all other size segments of
the market. In our view this gap will eventually contract as the slower growth
of large cap stocks redirects investor interest to the faster growth rates of
small and mid-cap stocks. The U.S. Diversified Growth Fund is well situated to
address these dynamics because the selection criteria for its investable
universe is based on a flexible approach to capitalization.
The views expressed in this report were those of the Fund's portfolio
manager as of April 30, 1999, and may not reflect the views of the portfolio
manager on the date this report is first published or any time thereafter. These
views are intended to assist shareholders of the Fund in understanding their
investment in the Fund and do not constitute investment advice; investors should
consult their own investment professionals as to their individual investment
programs.
- --------------------------------------------------------------------------------
2
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
PORTFOLIO CHARACTERISTICS AS OF APRIL 30, 1999 (UNAUDITED)
INVESTMENT BY INDUSTRY
% OF
INDUSTRY NET ASSETS
- ---------------------------------------------------------
Technology 25.29%
Consumer Cyclicals 21.09
Financial 18.15
Consumer Staples 11.30
Healthcare 10.92
Capital Goods/Construction 4.00
Telecommunications 3.24
Utilities 2.87
Insurance 2.06
Transportation 1.54
Cash and Other Net Assets (0.46)
--------
Total 100.00%
--------
--------
TOP TEN HOLDINGS
% OF
SECURITY NET ASSETS
- ---------------------------------------------------------
Providian Financial Corp. 3.55%
Sun Microsystems, Inc. 2.98
Ascend Communications, Inc. 2.91
Cardinal Health, Inc. 2.86
Tellabs, Inc. 2.65
Capital One Financial Corp. 2.55
Lexmark International Group, Inc. 2.54
Gap, Inc. 2.49
EMC Corp. 2.32
Harley-Davidson, Inc. 2.23
------
Total 27.08%
------
------
- --------------------------------------------------------------------------------
3
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
AS OF APRIL 30, 1999 (UNAUDITED)
COMMON STOCK - 100.5%
SHARES VALUE US$
- ------ -----------
CAPITAL GOODS/
CONSTRUCTION - 4.0%
8,400 Allied Waste Industries, Inc.(a) $ 148,575
4,400 American Power Conversion Corp.(a) 145,200
3,100 Tyco International Ltd. 251,875
-----------
545,650
-----------
CONSUMER CYCLICALS - 21.1%
4,300 Dayton Hudson Co. 289,443
5,100 Gap, Inc. 339,468
5,100 Harley-Davidson, Inc. 304,087
13,000 KMart Corp.(a) 193,375
5,700 Lowe's Companies, Inc. 300,675
3,900 Maytag Corp. 266,662
2,886 McKesson HBOC, Inc. 101,010
3,900 Quintiles Transnational Corp.(a) 158,193
4,500 Robert Half International, Inc.(a) 107,437
3,900 Tandy Corp. 282,506
8,700 TJX Cos., Inc. 289,818
5,100 Vulcan Materials Co. 243,525
-----------
2,876,199
-----------
CONSUMER STAPLES - 11.3%
6,511 Cardinal Health, Inc. 389,439
7,300 General Instrument Corp.(a) 266,450
3,700 Kroger Co.(a) 200,956
3,000 Quaker Oats Co. 193,687
4,100 Safeway, Inc.(a) 221,144
9,000 Staples, Inc.(a) 270,000
-----------
1,541,676
-----------
FINANCIAL - 18.2%
1,800 Alliance Capital Mangement L.P. 49,950
2,000 Capital One Financial Corp. 347,375
2,800 Fifth Third Bancorp 200,725
3,200 First Union Corp. 177,200
7,800 Firstar Corp. 234,487
400 M&T Bank Corp. 223,600
9,000 MBNA Corp. 253,687
4,800 Old Kent Financial Corp. 226,800
1,000 Progressive Corp. 143,500
3,750 Providian Financial Corp. 483,984
3,100 Wells Fargo & Co. 133,881
-----------
2,475,189
-----------
HEALTHCARE - 10.9%
4,800 Amgen, Inc.(a) 294,900
SHARES VALUE US$
- ------ -----------
HEALTHCARE (CONCLUDED)
5,600 Guidant Corp. $ 300,650
5,400 Mylan Laboratories, Inc. 122,512
5,400 Omnicare, Inc. 129,937
3,800 Omnicom Group, Inc. 275,500
2,700 PacifiCare Health Systems, Inc.,
"B"(a) 215,409
3,700 Watson Pharmaceuticals, Inc.(a) 149,850
-----------
1,488,758
-----------
INSURANCE - 2.1%
2,394 American International Group, Inc. 281,145
-----------
TECHNOLOGY - 25.3%
4,100 Ascend Communications, Inc.(a) 396,162
3,200 Computer Sciences Corp.(a) 190,600
2,500 Eastman Kodak Co. 186,562
2,900 EMC Corp.(a) 315,918
5,000 Fort James Corp. 190,000
4,900 Galileo International, Inc. 240,100
3,300 Gateway 2000, Inc.(a) 218,418
3,900 Ingram Micro, Inc.(a) 99,450
2,800 Lexmark International Group,
Inc.(a) 345,800
10,050 Oracle Corp.(a) 271,978
6,800 Sun Microsystems, Inc.(a) 406,725
3,300 Tellabs, Inc.(a) 361,569
7,200 Unisys Corp.(a) 226,350
-----------
3,449,632
-----------
TELECOMMUNICATIONS - 3.2%
4,200 AT&T Corp. 212,100
5,700 Century Telephone Enterprises,
Inc. 229,425
-----------
441,525
-----------
TRANSPORTATION - 1.5%
4,300 Gulfstream Aerospace Corp.(a) 209,625
-----------
UTILITIES - 2.9%
3,300 Columbia Energy Group 158,606
4,900 Peco Energy Co. 232,443
-----------
391,049
-----------
Total Investments - 100.5%
(cost $10,486,287) 13,700,448
Other Assets, Less
Liabilities - (0.5)% (62,461)
-----------
Total Net Assets - 100.0% $13,637,987
-----------
-----------
- --------------------------------------------------------------
(a) Non-income producing security.
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
4
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
ASSETS:
Investments (Note 2):
Investments, at cost $ 10,486,287
Net unrealized appreciation 3,214,161
-------------
Total Investments, at value 13,700,448
Receivable from administrator (Note 3) 4,507
Receivable for interest, dividends and other receivables 3,388
-------------
Total Assets 13,708,343
-------------
LIABILITIES:
Due to custodian 39,011
Payable to investment adviser (Note 3) 5,252
Payable to subadministrator (Note 3) 1,138
Accrued expenses and other liabilities 24,955
-------------
Total Liabilities 70,356
-------------
Net Assets $ 13,637,987
-------------
-------------
COMPONENTS OF NET ASSETS:
Paid-in capital $ 10,364,677
Undistributed net investment loss (60,817)
Accumulated net realized gain 119,966
Net unrealized appreciation on investments 3,214,161
-------------
Net Assets $ 13,637,987
-------------
-------------
SHARES OF BENEFICIAL INTEREST 2,179,536
NET ASSET VALUE, OFFERING, AND REDEMPTION PRICE PER SHARE $6.26
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1999 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividend income $ 38,917
Interest income 509
------------
Total Investment Income 39,426
------------
EXPENSES:
Investment advisory (Note 3) 50,117
Subadministration (Note 3) 6,682
Transfer agency (Note 3) 21,592
Custodian 1,048
Accounting (Note 3) 19,000
Legal 2,201
Audit 12,336
Registration 9,676
Reporting 6,263
Trustees 710
Miscellaneous 4,839
------------
Total Expenses 134,464
Fees waived (Note 5) (34,221)
------------
Net Expenses 100,243
------------
NET INVESTMENT LOSS (60,817)
------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments sold 119,966
Net change in unrealized appreciation on investments 2,564,208
------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS 2,684,174
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 2,623,357
------------
------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
6
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the
Six Months Ended For the
April 30, 1999 Year Ended
(unaudited) October 31, 1998
<S> <C> <C>
- -------------------------------------------------------------------------------------------------------------------
NET ASSETS, BEGINNING OF PERIOD $ 12,540,361 $ 13,861,150
-------------- --------------
OPERATIONS:
Net investment loss (60,817) (95,983)
Net realized gain on investments sold 119,966 4,826,342
Net change in unrealized appreciation
(depreciation) on investments 2,564,208 (3,505,555)
-------------- --------------
Net increase in net assets resulting from operations 2,623,357 1,224,804
-------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net realized gain on investments (4,808,678) (3,866,690)
-------------- --------------
CAPITAL SHARE TRANSACTIONS:
Sale of shares 168,989 261,603
Reinvestment of distributions 3,726,473 2,861,046
Redemption of shares (612,515) (1,801,552)
-------------- --------------
Net increase from capital share transactions 3,282,947 1,321,097
-------------- --------------
Net increase (decrease) in net assets 1,097,626 (1,320,789)
-------------- --------------
NET ASSETS, END OF PERIOD(a) $ 13,637,987 $ 12,540,361
-------------- --------------
-------------- --------------
SHARE TRANSACTIONS:
Sale of shares 27,150 31,106
Reinvestment of distributions of shares 640,287 386,628
Redemption of shares (97,403) (220,413)
-------------- --------------
Net increase in shares 570,034 197,321
-------------- --------------
-------------- --------------
</TABLE>
- ------------------
(a) Includes undistributed net investment loss of $60,817 and $0, respectively,
for the six months ended April 30, 1999 and the year ended October 31, 1998.
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
7
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Selected per share data and ratios for a share outstanding throughout each
period:
<TABLE>
<CAPTION>
For the
Six Months Ended
April 30, For the Year Ended October 31,
1999 ----------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
<S> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $ 7.79 $ 9.82 $ 9.76 $ 9.41 $ 8.52 $ 11.28
-------- -------- ------- ------- ------- -------
Investment Operations
Net Investment Income (Loss) (0.03) (0.06) (0.01) 0.04 0.07 0.04
Net Realized and Unrealized Gain (Loss)
on Investments 1.04 0.78 2.20 1.62 1.33 (0.27)
-------- -------- ------- ------- ------- -------
Total from Investment Operations 1.01 0.72 2.19 1.66 1.40 (0.23)
-------- -------- ------- ------- ------- -------
Distributions from
Net Investment Income -- -- (0.02) (0.07) (0.05) (0.01)
Net Realized Gain on Investments (2.54) (2.75) (2.11) (1.24) (0.46) (2.52)
-------- -------- ------- ------- ------- -------
Total Distributions (2.54) (2.75) (2.13) (1.31) (0.51) (2.53)
-------- -------- ------- ------- ------- -------
Net Asset Value, End of Period $ 6.26 $ 7.79 $ 9.82 $ 9.76 $ 9.41 $ 8.52
-------- -------- ------- ------- ------- -------
-------- -------- ------- ------- ------- -------
Total Return (a) 21.80% 8.87% 26.49% 19.45% 17.68% (2.01)%
Ratio/Supplementary Data:
Net Assets at End of Period (in
thousands) $ 13,638 $ 12,540 $13,861 $17,187 $19,688 $18,483
Ratios to Average Net Assets:
Expenses, including
reimbursement/waiver of fees 1.50%(b) 1.50% 1.50% 1.40% 1.40% 1.31%
Expenses, excluding
reimbursement/waiver of fees 2.01%(b) 1.85% 1.68% 1.43% N/A N/A
Net investment income (loss),
including reimbursement/waiver of
fees (0.91)%(b) (0.71)% (0.09)% 0.43% 0.78% 0.41%
Portfolio Turnover Rate 0% 209% 44% 57% 57% 27%
</TABLE>
- ------------------
(a) Total returns would have been lower had certain expenses not been reduced
during the periods shown (see Note 5).
(b) Annualized.
The accompanying notes are an integral part of the financial statements.
- --------------------------------------------------------------------------------
8
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1. ORGANIZATION
Schroder Capital Funds (Delaware) (the "Trust") was organized as a
Maryland corporation on July 30, 1969; reorganized as Schroder Capital Funds,
a series company, on February 29, 1988; and reorganized on January 9, 1996,
as a Delaware business trust. The Trust, which is registered as an open-end,
management investment company under the Investment Company Act of 1940, as
amended (the "Act"), currently has nine investment portfolios. Included in
this report is the Schroder U.S. Diversified Growth Fund (the "Fund"), which
is a diversified portfolio that commenced operations on October 31, 1970.
Under its Trust Instrument, the Trust is authorized to issue an unlimited
number of the Fund's Investor Shares and Advisor Shares of beneficial
interest without par value. As of April 30, 1999, only Investor Shares had
been issued.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
These financial statements are prepared in accordance with generally
accepted accounting principles, which require management to make certain
estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the date of
the financial statements, and the reported amounts of increase and decrease
in net assets from operations during the fiscal period. Actual amounts could
differ from those estimates.
The following represent the significant accounting policies of the
Fund:
INVESTMENT VALUATION
Portfolio securities listed on recognized stock exchanges are valued at
the last reported sale price on the exchange on which the securities are
principally traded. Listed securities traded on recognized stock exchanges
where last sale prices are not available are valued at the last sale price on
the preceding trading day or at the mean of the closing bid and ask prices
("mid-market price"). 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 mid-market price. Prices used for
valuations generally are provided by independent pricing services. Domestic
short-term investments, having a maturity of 60 days or less, are valued at
amortized cost, which approximates market value. 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 Trust's Board
of Trustees. As of April 30, 1999, the Fund did not hold a position in fair
valued securities.
SECURITY TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for on the trade date. Dividend
income is recorded on the ex-dividend date. Interest income is recorded as
earned. Identified cost of investments sold is used to determine gain and
loss for both financial statement and federal income tax purposes.
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income and capital gain, if any, are distributed to
shareholders at least annually and are recorded on the ex-dividend date.
Distributions are based on amounts calculated in accordance with applicable
federal income tax regulations, which may differ from generally accepted
accounting principles. These differences are due primarily to differing
treatments of income and gain on various investment securities held by the
Fund, timing differences and differing characterizations of distributions
made by the Fund.
- --------------------------------------------------------------------------------
9
<PAGE>
- --------------------------------------------------------------------------------
Schroder U.S. Diversified Growth Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONCLUDED)
FEDERAL TAXES
The Fund intends to qualify each year as a regulated investment company
and distribute all its taxable income. In addition, by distributing in each
calendar year substantially all its net investment income, capital gain and
certain other amounts, if any, the Fund will not be subject to federal excise
tax. Therefore, no federal income or excise tax provision is required.
EXPENSE ALLOCATION
The Trust accounts separately for the assets and liabilities and
operation of each of its funds. Expenses that are directly attributable to
more than one fund are allocated among the respective funds in proportion to
each fund's average net assets.
NOTE 3. INVESTMENT ADVISORY AND OTHER SERVICES
INVESTMENT ADVISER
Schroder Capital Management International Inc. ("SCMI") is the
investment adviser to the Fund. Pursuant to an Investment Advisory Agreement,
SCMI is entitled to receive compensation at an annual rate, payable monthly,
of 0.75% of the first $100 million of the Fund's average daily net assets and
0.50% of the Fund's average daily net assets in excess of $100 million.
The Trust has entered into a Sub-Administration Agreement with State
Street Bank and Trust Company and Schroder Fund Advisors, Inc. Under that
Agreement, the Fund, together with other mutual funds managed by SCMI and
certain related entities, pays fees to State Street based on the combined
average daily net assets of all of the funds in the Schroder complex,
according to the following annual rates: 0.06% of the first $1.7 billion of
such assets, 0.04% of the next $1.7 billion, and 0.02% of assets in excess of
$3.4 billion, subject to certain minimum requirements. Pursuant to a separate
agreement, the Fund pays State Street for accounting services at the
following annual rates: 0.02% of the first $100 million of net assets, 0.015%
of the next $100 million; 0.005% of the next $300 million, and 0.0025% of
assets in excess of $300 million, subject to certain minimum requirements.
Prior to June 1, 1999, the Fund paid subadministration fees to Forum
Administrative Services, LLC at an annual rate of 0.10% of the average daily
net assets of the Fund, and paid accounting fees to Forum Accounting
Services, LLC at an annual rate of $36,000.
SCMI has informed the Trust that it expects on or about July 1, 1999 to
be merged into Schroder Investment Management North America Inc., a newly
organized Delaware corporation. SCMI and Schroder Investment Management North
America Inc. are both wholly owned subsidiaries of Schroder U.S. Holdings,
Inc.
NOTE 4. PURCHASES AND SALES OF SECURITIES
The proceeds from sales of securities (excluding short-term
investments) for the period ended April 30, 1999, aggregated $1,508,127. The
cost of securities purchased for the period ended April 30, 1999 was solely
from short-term investments.
NOTE 5. WAIVER OF FEES
SCMI has voluntarily agreed to reduce its compensation for the Fund's
investment advisory services to 0.65% of the Fund's average daily net assets.
In addition, SCMI is contractually obligated to reduce its compensation (and,
if necessary, to pay certain other Fund expenses) until December 31, 1999, to
the extent that the Fund's net expenses exceed 1.50% (based on the Fund's
average daily net assets). For the period ended April 30, 1999, SCMI waived
fees of $28,221 and Forum Shareholder Services, LLC waived fees of $6,000.
- --------------------------------------------------------------------------------
10
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
TRUSTEES
Nancy A. Curtin, Chairman
David N. Dinkins
Peter E. Guernsey
Sharon L. Haugh
John I. Howell
Peter S. Knight
William L. Means
Clarence F. Michalis
Hermann C. Schwab
INVESTMENT ADVISER
Schroder Capital Management International Inc.
787 Seventh Avenue, 34th Floor
New York, NY 10019
ADMINISTRATOR AND DISTRIBUTOR
Schroder Fund Advisors Inc.
787 Seventh Avenue, 34th Floor
New York, NY 10019
CUSTODIAN
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
TRANSFER AND DIVIDEND
DISBURSING AGENT
Boston Financial Data Services
Two Heritage Drive
North Quincy, MA 02171
(800) 464-3108
COUNSEL
Ropes & Gray
One International Place
Boston, MA 02110
This report is for the information of the shareholders of the Schroder U.S.
Diversified Growth 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.
US. ESEMI0499
[SCHRODERS LOGO]
Schroder
U.S. Diversified
Growth
Fund
SEMI-ANNUAL REPORT
April 30, 1999
(Unaudited)
Schroder Capital Funds (Delaware)
