<PAGE>
Salomon Brothers
Opportunity Fund Inc
March 15, 2000
Dear Shareholder:
We are pleased to provide this semi-annual report for the Salomon Brothers
Opportunity Fund Inc ("Fund") as of February 29, 2000. Included in this report
are performance results, a market commentary, a summary of portfolio highlights,
and a statement of the Fund's investments and financial statements for the
period ended February 29, 2000.
During the six months ended February 29, 2000, the net asset value of the Fund
decreased from $49.69 per share at August 31, 1999 to $44.72 per share at
February 29, 2000. Dividends of $0.80 per share from net investment income and
$2.52 per share in capital gains were paid during this period. For the six
months ended February 29, 2000, the Fund posted a total return of a negative
3.80%. During the same period, the Standard & Poor's 500 Index returned 4.10%.
(The Standard & Poor's 500 Index ("S&P 500") is an index of widely held common
stocks listed on the New York and American Stock Exchanges and the
over-the-counter markets. Figures for the S&P 500 Index include reinvestment of
dividends. The index is unmanaged and is not subject to the same management and
trading expenses of a mutual fund.)
MARKET REVIEW
Until late October 1999, rising interest rates coincided with a moderate
worldwide decline in stock markets. By the middle of that month, the S&P 500 had
retraced most of its gains for the year, and certain major sectors in the U.S.
market -- among them financials, consumer cyclicals, health care, utilities, and
transportation -- had actually posted significant losses. Only technology
experienced big gains, while energy, capital goods, and basic materials had
risen more modestly. The market launched a remarkable recovery in October's
final days; however, it is unlikely that this rally will lead to any long-term
respite from market volatility.
U.S. market leadership remains fairly narrow, though not to the same extreme
degree as was the case in 1998. Outside the United States, a broadening has
taken place benefiting mainly those companies utilizing technology to help drive
innovation, restructuring and labor efficiency. But even some sectors and
companies that have been successful in incorporating new technologies into their
businesses have seen their valuations sag this year. The main macroeconomic
forces behind this phenomenon are fear of rekindled inflation, higher interest
rates, and, for U.S. companies, a weak dollar and deterioration in the U.S.
trade deficit.
Page 1
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
The stock market's major averages are in and around new highs, led by technology
stocks, but the bull market of 1999 was a narrow phenomenon with money flowing
into technology and most non-technology stocks performing poorly. In fact, with
the Federal Reserve Board's steady interest rate increases, most stocks declined
after the summer. Many Wall Street professionals think that the tech-stock gains
are evidence of a new era of technological innovation that may be rewriting the
rules of both the economy and the stock market, symbolized by the growing impact
of the Internet. Meanwhile, the yield on the long bond has been creeping higher
lately as market participants fret about inflation.
Equity performance has come from a broad array of countries, sectors, and
styles: Japan, developing Asia, France, energy, commodities, capital goods,
basic materials, and small-cap stocks (particularly overseas), as well as from
large-cap U.S. technology issues. But in another sense, leadership is narrow:
performance in each of these areas has been concentrated in a handful of
companies. The shift from manufacturing to service-oriented economies,
particularly in the United States, gives still more weight to the ability to
pick winners.
PORTFOLIO HIGHLIGHTS
We believe this Fund is unique in the large capitalization value category, as we
tend to hold our equity selections, as long as their valuations do not become
too lofty, in an attempt to avoid the distribution of significant taxable
capital gains to shareholders.
The Fund's underperformance versus its benchmark can be partially contributed to
its underweight positions in the technology sector, which was a crucial
component of S&P 500 performance during the period. Also, several of the leading
large capitalization growth companies are not held by the Fund because we
believe these stocks are vulnerable to a meaningful correction.
Thank you for continuing to pursue your long-term financial objectives with the
Salomon Brothers Opportunity Fund Inc.
Cordially,
/s/ Irving Brilliant
Irving Brilliant
President and Portfolio Manager
Page 2
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Results of an Investment in Salomon Brothers Opportunity Fund Inc
Set forth below are average annual total return figures for the periods
indicated and a graph showing the value of a hypothetical $10,000 investment
made in Salomon Brothers Opportunity Fund Inc on February 28, 1990. The average
annual total return figures and the information in the graph represent past
performance; they reflect changes in the price of the Fund's shares and assume
that any income dividends and/or capital gain distributions made by the Fund
during the period were reinvested in additional shares of the Fund. Investment
return and share price of the Fund will fluctuate. Shares when redeemed may be
worth more or less than original cost.
AVERAGE ANNUAL TOTAL RETURN
The average annual total return over the periods indicated below shows the
average annual percentage change in value of an investment in the Fund from the
beginning of the measurement period to the end of the measurement period. When
considering "average" total-return for periods longer than one year, it is
important to note that the Fund's annual total return for any one year in the
period might have been greater or less than the average for the entire period.
The Fund's average annual total returns for the periods indicated were as
follows:
2.77% for the one-year period beginning March 1, 1999 and ended February
29, 2000;
14.75% for the five-year period beginning March 1, 1995 and ended February
29, 2000;
12.42% for the ten-year period beginning March 1, 1990 and ended February
29, 2000.
PERFORMANCE COMPARISON -- GROWTH OF $10,000*
(UNAUDITED)
DATE S&P Salomon
2/90 10000 10000
8/90 8834 9892
8/91 10884 12548
8/92 12288 13541
8/93 14770 15597
8/94 15715 16448
8/95 19025 19970
8/96 21188 23710
8/97 29766 33342
8/98 28772 36049
8/99 33533 50399
2/00 32257 52466
*Past performance is not predictive of future performance.
Page 3
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Major Portfolio Changes (unaudited)
For the Six Months Ended February 29, 2000
ADDITIONS+
- -----------------------------------------------
Shares
------------
Amerada Hess Corp................. 10,000(1)
Aon Corp.......................... 6,000(1)
Arvin Industries, Inc............. 12,000(1)
The CIT Group, Inc., Class A Shares 11,000
Chartwell Re Corp................. 17,600
Fremont General Corp.............. 3,000
New Germany Fund.................. 10,000(1)
Newcourt Credit Group Inc......... 17,500
Old Republic International Corp... 8,000
Overseas Shipholding Group, Inc... 3,000
REDUCTIONS+
- -----------------------------------------------
Shares
------------
American General Corp............. 3,000
BJ's Wholesale Club, Inc.......... 10,500
The Bank of New York Co., Inc..... 41,000
The CIT Group, Inc., Class A Shares 13,000
General Dynamics Corp............. 5,000
Inso Corp......................... 5,000(2)
Intel Corp........................ 5,000
Kansas City Life Insurance Co..... 3,000
Loews Corp........................ 6,500
Newmont Mining Corp............... 3,000
The News Corp. Ltd.-ADR ......... 5,000
Orion Capital Corp................ 216,750(2)
TRC Cos., Inc..................... 4,000
Trenwick Group Inc................ 14,200
- -------------------
(1)New addition.
(2)Elimination.
+ Exclusive of changes resulting entirely from mergers, stock dividends, and
stock splits.
Page 4
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Schedule of Investments (unaudited)
February 29, 2000
<TABLE>
<CAPTION>
SHARES SECURITY VALUE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK -- 79.7%
Banks -- 18.0%
821,976 The Bank of New York Co., Inc..................................... $27,382,076
6,000 Mellon Financial Corp............................................. 180,750
125,000 Popular, Inc...................................................... 2,789,063
------------
30,351,889
------------
Basic Industry -- 4.6%
35,600 Amcast Industrial Corp............................................. 424,975
12,000 Arvin Industries, Inc.............................................. 220,500
6,000 Deltic Timber Corp................................................. 133,500
39,000 Mississippi Chemical Corp.......................................... 292,500
18,000 NL Industries, Inc................................................. 259,875
15,000 National Processing Inc.* ......................................... 132,187
8,077 Newmont Mining Corp................................................ 178,704
36,700 Rayonier Inc....................................................... 1,458,825
3,960 Smurfit-Stone Container Corp.*..................................... 53,955
17,100 Solutia Inc........................................................ 236,194
2,200 Southern Peru Copper Corp.......................................... 33,550
78,500 TRC Cos., Inc.* ................................................... 838,969
Tecumseh Products Co.:
34,100 Class A Shares .................................................. 1,470,562
47,000 Class B Shares .................................................. 1,894,687
9,900 Westinghouse Air Brake Co.......................................... 94,050
------------
7,723,033
------------
Biotechnology and Drugs -- 2.8%
10,404 Celltech Group PLC - ADR *......................................... 447,372
76,500 Monsanto Co........................................................ 2,969,156
25,375 Pharmacia & Upjohn, Inc............................................ 1,208,484
------------
4,625,012
------------
Construction -- 1.0%
28,400 Ameron International Corp.......................................... 990,450
17,000 Lafarge Corp....................................................... 334,688
Liberty Homes, Inc.:
29,050 Class A Shares .................................................. 196,087
24,750 Class B Shares .................................................. 177,117
------------
1,698,342
------------
Consumer Goods -- 12.6%
35,500 Alexander & Baldwin, Inc........................................... 726,640
23,000 BJ's Wholesale Club, Inc.* ........................................ 713,000
9,700 Cone Mills Corp.*.................................................. 38,194
96,000 Fine Host Corp.* + ................................................ 900,338
10,900 Harcourt General, Inc.............................................. 375,369
18,000 Homebase, Inc.* ................................................... 46,125
92,000 Koninklijke (Royal) Philips Electronics N.V. - ADR................. 17,618,000
</TABLE>
See Notes to Financial Statements.
Page 5
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Schedule of Investments (unaudited)(continued)
February 29, 2000
<TABLE>
<CAPTION>
SHARES SECURITY VALUE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Consumer Goods -- 12.6% (continued)
3,284 The Neiman Marcus Group, Inc., Class B Shares* .................... $ 68,964
15,737 The News Corp. Ltd. - ADR.......................................... 791,768
------------
21,278,398
------------
Energy -- 9.7%
10,000 Amerada Hess Corp.................................................. 505,625
32,000 Murphy Oil Corp.................................................... 1,620,000
15,000 Pogo Producing Co.................................................. 346,875
260,000 Royal Dutch Petroleum Co. - ADR.................................... 13,650,000
10,000 Talisman Energy Inc.* ............................................. 260,000
------------
16,382,500
------------
Finance -- 5.4%
12,010 American General Corp.............................................. 626,772
30,250 The CIT Group, Inc., Class A Shares................................ 423,500
8,000 Chile Fund......................................................... 91,000
50,000 Freddie Mac ....................................................... 2,087,500
60,300 Leucadia National Corp............................................. 1,288,912
77,500 Loews Corp......................................................... 3,448,750
10,000 New Germany Fund................................................... 143,750
48,000 The Pioneer Group, Inc.* .......................................... 963,000
------------
9,073,184
------------
Healthcare -- 1.1%
12,000 Foundation Health Systems, Inc., Class A Shares *.................. 99,750
6,827 HEALTHSOUTH Corp.* ................................................ 33,282
36,000 Humana Inc.* ...................................................... 245,250
22,077 Wellpoint Health Networks Inc.* ................................... 1,490,197
------------
1,868,479
------------
Insurance - Life, Accident and Health -- 0.5%
1,714 Delphi International Ltd.*......................................... 8,516
30,950 Fremont General Corp............................................... 224,388
8,800 Kansas City Life Insurance Co...................................... 281,600
30,040 UnumProvident Corp................................................. 401,785
------------
916,289
------------
Insurance - Property and Casualty -- 12.5%
5,040 Allmerica Financial Corp........................................... 210,420
6,000 Aon Corp........................................................... 125,625
101,300 CNA Financial Corp.* .............................................. 2,735,100
328,000 The Chubb Corp..................................................... 16,133,500
5,000 Everest Reinsurance Holdings, Inc.................................. 122,813
40,000 Merchants Group, Inc............................................... 742,500
50,000 Old Republic International Corp.................................... 584,375
4,000 Reliance Group Holdings, Inc....................................... 17,750
29,445 Trenwick Group Inc................................................. 388,306
------------
$21,060,389
------------
</TABLE>
See Notes to Financial Statements.
Page 6
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Schedule of Investments (unaudited)(continued)
February 29, 2000
<TABLE>
<CAPTION>
SHARES SECURITY VALUE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Real Estate -- 3.2%
Forest City Enterprises, Inc.:
118,500 Class A Shares .................................................. $ 3,229,125
66,100 Class B Shares, Convertible...................................... 2,065,625
47,776 HomeFed Corp.*..................................................... 27,710
------------
5,322,460
------------
Technology -- 2.1%
20,000 Intel Corp......................................................... 2,260,000
15,000 National Semiconductor Corp.* ..................................... 1,126,875
21,302 Silicon Graphics, Inc.* ........................................... 209,026
------------
3,595,901
------------
Transportation -- 6.2%
79,200 AMR Corp........................................................... 4,187,700
73,000 Airborne Freight Corp.............................................. 1,350,500
32,000 Canadian Pacific Ltd. ............................................. 624,000
75,100 General Dynamics Corp.............................................. 3,248,075
9,500 International Shipholding Corp..................................... 90,844
3,078 KLM - ADR.......................................................... 58,674
18,000 Lockheed Martin Corp............................................... 313,875
23,600 Overseas Shipholding Group, Inc.................................... 491,175
------------
10,364,843
------------
TOTAL COMMON STOCK (Cost-- $38,432,871)........................... 134,260,719
------------
</TABLE>
<TABLE>
<CAPTION>
FACE
AMOUNT SECURITY VALUE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
CONVERTIBLE CORPORATE BONDS -- 0.3%
Consumer Goods -- 0.3%
$2,500,000 Sunbeam Corp., zero coupon due 3/25/18++ (Cost -- $616,258)........ 418,750
------------
TOTAL LONG-TERM INVESTMENTS (Cost -- $39,049,129).................. 134,679,469
------------
CORPORATE SHORT-TERM NOTES -- 20.0%
4,912,000 American Greetings, 5.780% due 3/7/00.............................. 4,907,268
5,000,000 Cummins Engine Co., Inc., 5.950% due 3/13/00....................... 4,990,083
2,544,000 Earthgrains Co., 5.980% due 3/16/00................................ 2,537,661
1,602,000 Edison Mission Energy Funding, 5.950% due 3/3/00................... 1,601,471
2,819,000 Edison Mission Energy Funding, 5.970% due 3/3/00................... 2,818,065
4,856,000 General Motors Acceptance Corp., 5.770% due 3/7/00................. 4,851,330
2,512,000 Pacific Gas & Electric Corp., 5.800% due 3/10/00................... 2,508,358
5,000,000 Texas Utilities Co., 5.950% due 3/7/00............................. 4,995,042
4,470,000 University of California, 5.750% due 3/1/00........................ 4,470,000
------------
TOTAL CORPORATE SHORT-TERM NOTES (Cost -- $33,679,278)............. 33,679,278
------------
TOTAL INVESTMENTS-- 100% (Cost -- $72,728,407**)................... $168,358,747
============
</TABLE>
----------------------
* Non-income producing security.
+ Security valued at fair value.
++ Security is exempt from registration under Rule 144A of the Securities Act
of 1933. This security may be resold in transactions that are exempt from
registration, normally to qualified institutional buyers.
** Aggregate cost for Federal income tax purposes is substantially the same.
See Notes to Financial Statements.
Page 7
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Statement of Assets and Liabilities (unaudited)
February 29, 2000 ASSETS:
<TABLE>
<S> <C>
Assets
Investments, at value (cost -- $39,049,129)..................................... $ 134,679,469
Corporate short-term notes, at value (Cost -- $33,679,278)...................... 33,679,278
Cash............................................................................ 5,132
Receivable for securities sold.................................................. 320,639
Dividends and interest receivable............................................... 69,382
Other........................................................................... 710
------------
TOTAL ASSETS.................................................................... 168,754,610
------------
LIABILITIES:
Management fees payable......................................................... 137,718
Payable for Fund shares reacquired.............................................. 37,802
Accrued expenses................................................................ 69,768
------------
TOTAL LIABILITIES............................................................... 245,288
------------
TOTAL NET ASSETS.................................................................. $168,509,322
============
NET ASSETS:
Common stock ($0.01 par value, authorized 15,000,000 shares;
3,768,381 shares outstanding)................................................. $ 37,684
Capital paid in excess of par value............................................. 61,604,103
Undistributed net investment income............................................. 137,497
Accumulated net realized gain from security transactions........................ 11,099,698
Net unrealized appreciation of investments...................................... 95,630,340
------------
TOTAL NET ASSETS.................................................................. $168,509,322
============
Net Asset Value, Per Share ($168,509,322/3,768,381 shares)........................ $44.72
=======
</TABLE>
See Notes to Financial Statements.
Page 8
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Statement of Operations (unaudited)
For the Six Months Ended February 29, 2000
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends....................................................................... $1,089,692
Interest........................................................................ 1,044,423
Less: Foreign withholding tax................................................... (32,868)
----------
TOTAL INVESTMENT INCOME......................................................... 2,101,247
----------
EXPENSES:
Management fees (Note 2)........................................................ 907,939
Shareholder services............................................................ 23,660
Audit and tax services.......................................................... 21,840
Shareholders communication fees................................................. 19,110
Legal........................................................................... 17,290
Registration fees............................................................... 8,190
Custody......................................................................... 5,486
Directors' fees................................................................. 3,640
Other........................................................................... 8,676
----------
TOTAL EXPENSES.................................................................. 1,015,831
----------
NET INVESTMENT INCOME............................................................. 1,085,416
----------
REALIZED AND UNREALIZED GAIN (LOSS)ON INVESTMENTS (NOTE 3):
Realized Gain From Security Transactions
(excluding short-term securities):
Proceeds from sales........................................................... 14,882,873
Cost of securities sold....................................................... 3,102,576
----------
NET REALIZED GAIN............................................................... 11,780,297
----------
Change in Net Unrealized Appreciation on Investments:
Beginning of period........................................................... 115,159,914
End of period................................................................. 95,630,340
-----------
DECREASE IN NET UNREALIZED APPRECIATION......................................... (19,529,574)
-----------
NET LOSS ON INVESTMENTS........................................................... (7,749,277)
-----------
DECREASE IN NET ASSETS FROM OPERATIONS............................................ $(6,663,861)
===========
</TABLE>
See Notes to Financial Statements.
Page 9
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
<TABLE>
Statements of Changes in Net Assets
For the Six Months Ended February 29, 2000 (unaudited) and the Year Ended August 31, 1999
<CAPTION>
2000 1999
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS:
Net investment income.................................... $ 1,085,416 $ 2,984,316
Net realized gain........................................ 11,780,297 12,237,894
Increase (decrease) in net unrealized appreciation....... (19,529,574) 13,762,924
------------- -------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS........ (6,663,861) 28,985,134
------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income.................................... (3,100,369) 1,859,719)
Net realized gains....................................... (9,475,296) (18,345,689)
------------- ------------
DECREASE IN NET ASSETS FROM
DISTRIBUTIONS TO SHAREHOLDERS.......................... (12,575,665) (20,205,408)
------------- ------------
FUND SHARE TRANSACTIONS (NOTE 4):
Net proceeds from sale of shares......................... 1,637,432 2,519,335
Net asset value of shares issued for
reinvestment of dividends.............................. 9,758,565 16,435,063
Cost of shares reacquired................................ (12,390,669) (16,259,750)
------------ -------------
INCREASE (DECREASE) IN NET ASSETS
FROM FUND SHARE TRANSACTIONS........................... (994,672) 2,694,648
------------- -------------
INCREASE (DECREASE) IN NET ASSETS.......................... (20,234,198) 11,474,374
NET ASSETS:
Beginning of period...................................... 188,743,520 177,269,146
------------- -------------
END OF PERIOD*........................................... $168,509,322 $188,743,520
============= =============
*Includes undistributed net investment income of:........ $137,497 $2,152,450
============= =============
</TABLE>
See Notes to Financial Statements.
Page 10
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Notes to Financial Statements (unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES
The Salomon Brothers Opportunity Fund Inc ("Fund") is registered as a
non-diversified, open-end management investment company under the Investment
Company Act of 1940, as amended. The Fund's primary objective is to achieve
above average long-term capital appreciation. Current income is a secondary
objective. The following is a summary of significant accounting policies
consistently followed by the Fund in the preparation of its financial
statements. The policies are in conformity with generally accepted accounting
principles ("GAAP"). The preparation of financial statements in accordance with
GAAP requires management to make estimates of certain reported amounts in the
financial statements. Actual amounts could differ from those estimates.
(A) SECURITIES VALUATION. Portfolio securities listed or traded on national
securities exchanges, or reported on the NASDAQ national market system, are
valued at the last sale price, or if there have been no sales on that day, at
the mean of the current bid and ask price which represents the current value of
the security. Over-the-counter securities are valued at the mean of the current
bid and ask price. If no quotations are readily available (as may be the case
for securities of limited marketability), or if "restricted" securities are
being valued, such portfolio securities and other assets are valued at fair
value determined pursuant to procedures established by the Board of Directors.
Short-term securities with less than 60 days remaining to maturity when acquired
by the Fund are valued at amortized cost which approximates market value.
(B) FEDERAL INCOME TAXES. The Fund has complied and intends to continue to
comply with the requirements of the Internal Revenue Code of 1986, as amended,
applicable to regulated investment companies, and to distribute substantially
all of its taxable income to its shareholders. Therefore, no Federal income tax
or excise tax provision is required.
(C) DIVIDENDS AND DISTRIBUTIONS. The Fund declares and pays dividends from
net investment income and distributions from net realized gains, if any,
annually. Dividends and distributions to shareholders are recorded on the
ex-dividend date. The amount of dividends and distributions from net investment
income and net realized gains are determined in accordance with Federal income
tax regulations, which may differ from GAAP. Permanent book/tax differences are
reclassified within the capital accounts based on their Federal income tax basis
treatment; temporary differences do not require reclassifications. Dividends and
distributions which exceed net investment income and net realized gains for
financial reporting purposes but not for tax purposes are reported as dividends
in excess of net investment income and distributions in excess of net realized
capital gains. To the extent they exceed net investment income and net realized
capital gains for tax purposes, they are reported as tax return of capital.
Page 11
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Notes to Financial Statements (unaudited) (continued)
(D) OTHER. Securities transactions are recorded as of the trade date.
Dividend income and dividends payable are recorded on the ex-dividend date.
Interest income is recognized when earned. Noncash dividend income is recorded
based on market or fair value of property received. Gains or losses on sales of
securities are calculated for financial accounting and Federal income tax
purposes on the identified cost basis.
2. MANAGEMENT FEE AND OTHER TRANSACTIONS
The Fund retains Salomon Brothers Asset Management Inc ("SBAM"), a
wholly-owned subsidiary of Salomon Smith Barney Holdings Inc. ("SSBH"), to act
as investment manager of the Fund, subject to the supervision by the Board of
Directors of the Fund. SBAM furnishes the Fund with office space and pays the
compensation of its officers. The management fee for these services is payable
monthly at an annual rate of 1% of average daily net assets.
3. PORTFOLIO ACTIVITY
During the six months ended February 29, 2000, the aggregate cost of
purchases and proceeds from sales of investments (excluding short-term
securities) were as follows:
Purchases ................................................... $ 1,846,052
===========
Sales........................................................ $14,882,873
===========
At February 29, 2000, the aggregate gross unrealized appreciation and
depreciation of investments for Federal income tax purposes were substantially
as follows:
Gross unrealized appreciation............................... $98,246,825
Gross unrealized depreciation............................... (2,616,485)
-----------
Net unrealized appreciation................................. $95,630,340
===========
4. SHARES OF CAPITAL STOCK
At February 29, 2000, the Fund had 15,000,000 shares of capital stock
authorized with a par value of $0.01 per share. Transactions in shares for the
portfolio were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
FEBRUARY 29, 2000 AUGUST 31, 1999
------------------------- -------------------------
<S> <C> <C> <C> <C>
SHARES AMOUNT SHARES AMOUNT
------- ---------- ------- -----------
Shares sold................................ 34,596 $ 1,637,432 50,822 $ 2,519,335
Shares issued on reinvestment.............. 199,416 9,758,565 333,965 16,435,063
Shares reacquired.......................... (264,007) (12,390,669) (329,146) (16,259,750)
-------- ----------- ------- -----------
Net Increase (Decrease).................... (29,995) $ (994,672) 55,641 $ 2,694,648
======== =========== ======= ===========
</TABLE>
Page 12
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Financial Highlights
Selected data per share of capital stock outstanding throughout each year ended
August 31, except where noted:
<TABLE>
2000(1) 1999 1998 1997 1996 1995
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $49.69 $47.36 $50.64 $37.89 $35.75 $31.47
------ ------ ------ ------ ------ ------
Income (Loss) From Operations:
Net investment income............ 0.28 0.76 0.46 0.43 0.60 0.45
Net realized and unrealized
gain (loss)................... (1.93) 6.98 (1.95) 14.46 3.38 5.68
------ ------ ------ ------ ------ ------
Total Income (Loss) From
Operations....................... (1.65) 7.74 (1.49) 14.89 3.98 6.13
------ ------ ------ ------ ------ ------
Less Distributions From:
Net investment income............ (0.80) (0.47) (0.39) (0.62) (0.48) (0.37)
Net realized gains............... (2.52) (4.94) (1.40) (1.52) (1.36) (1.48)
------ ------ ------ ------ ------ ------
Total Distributions................ (3.32) (5.41) (1.79) (2.14) (1.84 (1.85)
------ ------ ------ ------ ------ ------
Net Asset Value, End of Period..... $44.72 $49.69 $47.36 $50.64 $37.89 $35.75
====== ====== ====== ====== ====== ======
Total Return....................... (3.8)%++ 16.5% (3.3)% 40.5% 11.4% 21.1%
Net Assets, End of Period (000s)... $168,509 $188,744 $177,269 $188,496 $141,984 $131,237
Ratios to Average Net Assets:
Expenses......................... 1.12%+ 1.14% 1.12% 1.16% 1.18% 1.18%
Net investment income............ 1.20+ 1.55 0.83 0.95 1.59 1.39
Portfolio Turnover Rate............ 1% 3% 3% 4% 5% 8%
</TABLE>
- ---------------------
(1) For the six months ended February 29, 2000 (unaudited).
++ Total return is not annualized, as it may not be representative of the total
return for the year.
+ Annualized.
Page 13
<PAGE>
S A L O M O N B R O T H E R S O P P O R T U N I T Y F U N D I N C
Directors
IRVING BRILLIANT
Chairman and President
B. ALEXANDER GAGUINE
Consultant
ROSALIND A. KOCHMAN
Administrator and counsel,
Kochman Eye Surgical Facility
IRVING SONNENSCHEIN
Partner of law firm of Sonnenschein,
Sherman & Deutsch
Officers
IRVING BRILLIANT
President and Portfolio Manager
LEWIS E. DAIDONE
Executive Vice President and Treasurer
ANTHONY PACE
Controller
CHRISTINA T. SYDOR
Secretary
ROBERT A. VEGLIANTE
Assistant Secretary
Salomon Brothers Opportunity Fund Inc
7 World Trade Center
New York, New York 10048
1-888-777-0102, toll free
INVESTMENT MANAGER
Salomon Brothers Asset Management Inc
7 World Trade Center
New York, New York 10048
DISTRIBUTOR
CFBDS, Inc.
21 Milk Street
Boston, Massachusetts 02109-5408
CUSTODIAN
PNC Bank
8800 Tinicom Blvd.
Suite 200
Philadelphia, Pennsylvania 19153
DIVIDEND DISBURSING AND TRANSFER AGENT
PFPC Global Fund Services
P.O. Box 9764
Providence, Rhode Island 02940-9764
LEGAL COUNSEL
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017-3909
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
- ------------------------------------------------------------------------------
This report is submitted for the general information of the shareholders of
Salomon Brothers Opportunity Fund Inc. It is not authorized for distribution to
prospective investors unless accompanied or preceded by an effective Prospectus
for the Fund, which contains information concerning the Fund's investment
policies and expenses as well as other pertinent information.
Page 14
<PAGE>
PFPC Global Fund Services
P.O. Box 9764
Providence, Rhode Island 02940-9764
Salomon Brothers
Opportunity Fund Inc
Semi-Annual Report
FEBRUARY 29, 2000
Salomon Brothers Asset Management
Not FDIC Insured o No Bank Guarantee o May Lose Value
FIRST-CLASS
U.S. POSTAGE
PAID
NORTHREADING, MA
PERMITNo. 105
OPSEMI 2/00
