DK INVESTORS INC.
2000 SEMI-ANNUAL REPORT
<PAGE>
DK INVESTORS, INC.
205 Lexington Avenue, 16th Floor
New York, New York 10016
(212) 779-4233
_________________________________________________________________________
August 29, 2000
To Our Shareholders:
What an interesting time we live in. Business is good--the stock market
goes down. Business is bad--the stock market goes up. Unemployment is
low--that's bad. It seems that each day new criteria arise to affect the
market. Old values and old criteria no longer appear to hold sway. I am
happy to report, however, that it appears that your Board of Directors
is doing something right.
With the help of our investment advisor, we are continuing to invest in
tax-exempt bonds having a Moody's rating of A or better. We decided, at
our May meeting, to continue to ladder our investments so that we can
take advantage of any significant interest rate changes. We purchase
bonds maturing anywhere from two to ten years from the date of purchase.
This way we will always have maturities to provide us cash to make new
purchases and take advantage of the best interest rates available at the
time.
Annexed hereto you will find our auditor's report on the financial
condition of the Company as of June 30th. During the fiscal period
January 1 through June 30, DK Investors had net earning of $316,226.
This compares to $341,694 during the same fiscal period in 1999. These
earnings translate to $0.27 per share of our common stock. In January
2000, and again in May, DK paid dividends to shareholders totaling $0.24
per share. A dividend of $0.12 per share was also paid to shareholder in
July of this year.
At our annual meeting held in May, the following directors were elected:
Gene Nadler, Harry Nadler, Francine Yellon, Andrew Brucker, Joseph Kell,
Angelo Balafas, and Thomas B. Schulhof. After the shareholders' meeting,
your Board of Directors met and elected Gene Nadler President, Angelo
Balafas Vice President, and Harry Nadler Secretary. The next meeting of
the Board will be held in September 2000.
Sincerely,
Gene Nadler
President
<PAGE>
FINANCIAL STATEMENTS
JUNE 30, 2000
To the Shareholders and Board of Directors
DK Investors Inc.
We have performed a limited review of the statements of assets and
liabilities of DK Investors Inc., including the portfolio of investments
as of June 30, 2000, and the related statements of operations and changes
in net assets for the six months then ended.
Our review was performed in accordance with standards for such reviews
promulgated by the American Institute of Certified Public Accountants,
and, accordingly, consisted principally of obtaining an understanding of
the accounting system for preparation of interim financial information;
making an analytical review of pertinent financial data; and making
inquiries of, and evaluating responses from certain officials of the
company who have responsibility for financial and accounting methods.
All information included in these financial statements is the
representation of the management of DK Investors Inc.
Because our limited review did not constitute an examination made in
accordance with generally accepted auditing standards, we express no
opinion on the aforementioned financial statements.
Based on our review, we are not aware of any material modifications that
should be made to the accompanying financial statements, in order for
them to be in conformity with generally accepted accounting principles.
CUMMINGS & CARROLL, P.C.
Certified Public Accountants
August 14, 2000
Great Neck, New York
<PAGE>
DK INVESTORS INC.
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30,
(Unaudited)
ASSETS
2000 1999
---- ----
Investments in securities at market
(identified cost - 2000 $15,293,974
1999 $15,579,616) $ 15,161,511 $ 15,441,263
Accrued interest receivable 266,480 276,881
Deferred charge 7,918 10,984
Cash 128,370 4,278
------------ ------------
Total Assets $ 15,564,279 $ 15,733,406
============ ============
LIABILITIES
Payable for securities purchased $ 546,357 $ 596,898
Accrued expenses 40,734 42,808
Dividends payable
(2000 - July 10, 2000
1999 - July 12, 1999) 141,086 176,358
------------ ------------
Total Liabilities 728,177 816,064
------------ ------------
Net assets
(equivalent to $12.62 and $12.69 per
share respectively, based on
1,175,664 shares capital stock
outstanding) $ 14,836,102 $ 14,917,342
============ ============
See accountants' review report and accompanying notes.
<PAGE>
<TABLE>
DK INVESTORS INC.
INVESTMENT IN SECURITIES
JUNE 30, 2000
(Unaudited)
<CAPTION>
% OF
INVESTMENT
COUPON PRINCIPAL COST OR MARKET BASED
SECURITIES RATE MATURITY AMOUNT BASIS VALUE ON M.V.
---------- ------ -------- ------------ ------------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Wisc.Pub Pwr Sys 7.000 2000 $ 500,000 $ 500,040 $ 500,035 3.30%
Carson City Nev Sch Dist 7.700 2001 265,000 271,300 271,265 1.79%
Delaware Trans Auth 7.100 2001 200,000 204,003 204,404 1.35%
Harrison Cnty MS Sch Dist 7.000 2002 70,000 73,065 72,587 0.48%
NYS Environ.Fac Corp. 7.300 2002 500,000 510,739 511,045 3.37%
Lewisville TX Indpt Sch Dist 7.500 2002 300,000 317,988 316,932 2.09%
Hamilton Twp NJ Sch Dist 7.000 2002 260,000 274,600 274,217 1.80%
Lincoln, MI Cons Sch Dist 7.000 2003 325,000 349,573 343,808 2.27%
Rowlett, TX 6.000 2004 170,000 178,753 176,703 1.17%
Gladstone MI Pub Sch 6.500 2005 100,000 110,079 107,073 0.71%
NYS Dorm Auth 6.500 2005 250,000 270,132 266,695 1.76%
FL St Brd Mand SKG 7.500 2005 20,000 20,722 20,299 0.13%
Metro Pier and Expo 6.250 2005 100,000 109,581 106,102 0.70%
Metro Pier and Expo 6.500 2005 310,000 340,478 331,015 2.18%
Jackson Miss Pub Sch 6.250 2005 130,000 138,611 138,290 0.91%
NY Dorm Auth 7.800 2005 40,000 41,778 40,889 0.27%
Port Seattle Wash Rev 7.300 2005 300,000 320,136 309,276 2.04%
NYS Dorm Auth Rev 6.500 2006 190,000 210,819 204,341 1.35%
Wisc St. Clean Wtr Rev 6.125 2006 350,000 385,830 372,152 2.46%
Ohio St. Bldg. Auth 6.000 2006 210,000 225,589 223,106 1.47%
Scottsdale, AZ G/O 6.500 2006 250,000 274,108 272,075 1.80%
NJ Waste Wtr Treatment 7.000 2007 200,000 230,332 224,518 1.48%
Tucson, AZ Wtr 6.750 2007 200,000 224,737 221,834 1.46%
Wichita, KS W&S 6.000 2007 600,000 645,342 639,222 4.22%
Chicago,IL Met Wtr Reclam 7.000 2008 100,000 111,438 111,921 0.74%
NYS Dorm Auth 6.000 2008 240,000 264,963 250,712 1.65%
Intermountain Pwr UT 6.250 2008 300,000 321,101 323,460 2.13%
Las Vegas Valley Wtr 7.000 2008 225,000 241,005 229,984 1.52%
Brownville, TX Indpt Sch 7.250 2008 575,000 665,852 659,151 4.35%
Fort Bend Cnty Tx MunUtil 6.500 2009 375,000 416,780 412,485 2.72%
Pampa TX Wtr 7.400 2009 100,000 106,512 100,507 0.66%
Clark Cnty Nev Sch Dist 7.000 2009 350,000 362,737 361,652 2.39%
Texas Mun Pwr Agy 6.100 2009 500,000 535,864 539,255 3.56%
Mississippi St G/O 5.750 2009 300,000 311,400 315,456 2.08%
SE TX Hosp fin Agy 7.500 2009 90,000 93,509 98,751 0.65%
Chicago IL G/O 6.000 2010 175,000 182,666 185,528 1.22%
Texas St. Pub Fin Auth 6.500 2010 250,000 269,145 276,265 1.80%
New Mexico Mtg Fin Auth 6.850 2010 10,000 10,116 10,071 0.07%
NV Hsg Dev 7.550 2010 245,000 249,710 248,151 1.64%
RI Hsg & Mtg 7.700 2010 500,000 513,339 517,500 3.41%
<PAGE>
</TABLE>
<TABLE>
DK INVESTORS INC.
INVESTMENT IN SECURITIES
JUNE 30, 2000
(Unaudited)
<CAPTION>
% OF
INVESTMENT
COUPON PRINCIPAL COST OR MARKET BASED
SECURITIES RATE MATURITY AMOUNT BASIS VALUE ON M.V.
---------- ------ -------- ------------ ------------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
MA St. Ref Ser A 6.000 2010 325,000 344,164 350,142 2.31%
McLean & Woodford Cty IL 7.375 2010 600,000 681,632 707,640 4.67%
Kenosha, Wisc Wtwks 7.000 2011 350,000 381,651 365,533 2.41%
Austin TX Util Sys 6.750 2012 100,000 104,183 103,928 0.69%
Birmingham ALA UT 6.600 2012 275,000 282,588 287,174 1.89%
Jonesboro, AR Indl Dev 6.500 2012 500,000 540,137 522,930 3.45%
Arkansas St. Dev. Fin. 7.000 2014 500,000 535,723 516,645 3.41%
Missouri St. Environmental 6.875 2014 110,000 120,219 115,007 0.76%
Missouri St Env Auth 7.200 2016 200,000 215,824 216,262 1.43%
Austin Comb Util 8.000 2016 125,000 138,628 128,894 0.85%
Maine St HSG Auth 7.100 2016 200,000 197,620 204,654 1.35%
Wisconsin HSG & ECO 7.350 2017 60,000 60,168 60,671 0.40%
Wisconsin HSG & ECO 6.400 2017 350,000 346,500 354,008 2.33%
Michigan St. Hosp. 7.500 2018 175,000 192,125 181,801 1.20%
Richmond, VA 6.250 2021 250,000 268,340 257,490 1.70%
------------ ------------ ------------ -------
$ 14,295,000 $ 15,293,974 $ 15,161,511 100.00%
============ ============ ============ =======
</TABLE>
See accountants' review report and accompanying notes.
<PAGE>
DK INVESTORS INC.
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30,
(Unaudited)
2000 1999
----------- ------------
Income
Interest - municipal obligations
(Less amortization of premiums
2000 $84,151; 1999 $73,793) $ 387,158 $ 416,980
Expenses
Investment advisory fee 29,120 29,934
Shareholder servicing costs,
including transfer agent and
dividend disbursing agent fees
and expense 3,519 3,817
Reports to shareholders 4,263 4,150
Legal fees 12,718 12,757
Auditing fees 6,250 6,250
Directors fees 3,600 3,900
Insurance 9,805 12,540
Miscellaneous 1,657 1,938
----------- ------------
70,932 75,286
----------- ------------
Net investment income $ 316,226 $ 341,694
=========== ============
Realized and Unrealized Gain (loss) on Investments
Realized gain (loss) from sale of securities
(excluding short-term securities)
Proceeds from sales $ 1,511,800 $ 1,678,102
Cost of securities sold 1,546,553 1,736,249
------------ -------------
Realized gain (loss) (34,753) (58,147)
------------ -------------
Unrealized appreciation (depreciation of investments)
Beginning of period (240,055) 140,713
End of period (132,463) (138,353)
------------ -------------
Increase (decrease) in unrealized
appreciation 107,592 (279,066)
------------ -------------
Total Realized and Unrealized Gain
(loss) on Investments $ 72,839 $ (337,213)
============ =============
See accountants' review report and accompanying notes.
<PAGE>
DK INVESTORS INC.
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED JUNE 30,
(Unaudited)
2000 1999
------------ ------------
INVESTMENT ACTIVITIES
Net investment income $ 316,226 $ 341,694
Realized and unrealized gain
(loss) on investments 72,839 (337,213)
Distributions to shareholders (282,172) (364,472)
------------- -------------
Increase (decrease) in net assets 106,893 (359,991)
NET ASSETS
Beginning of period--
January 1, 2000 - 1999 14,729,209 15,277,333
------------- -------------
End of period--
June 30, 2000 - 1999 $ 14,836,102 $ 14,917,342
============= =============
See accountants' review report and accompanying notes.
Note 1 - Summary of Significant Accounting Policies
The Company is registered under the Investment Company Act of 1940 as a
diversified, closed-end, management investment company. The significant
accounting policies followed by the Company are summarized as follows:
a. Security Valuation
Investments in securities were valued at the bid price by Chase Bank.
b. Federal Income Taxes
The Company qualifies under Subchapter M of the Internal Revenue Code
as a "regulated investment company" for federal income tax purposes,
investing all of its assets in tax-exempt state and local obligations.
The Company intends to distribute all of its net investment income to
its stockholders. The Company will be relieved of federal income taxes
on such income, and dividends so distributed will be tax-free to
shareholders.
c. Income and Expense Recognition
Interest income and related expenses are recognized on the accrual basis.
Amortization of bond premium calculated by the straight-line method is
charged against interest income over the term of the bond.
d. Other
As is common in the industry, security transactions are accounted for on
the date the securities are purchased or sold. Dividend income and
distribution to shareholders are recorded on the ex-dividend date. Each
expense accounting for 5 per cent of total expense is separately reported.
Note 2 - Purchases and Sales of Securities
During the period ended June 30, 2000, purchases and sales of
securities other than short-term were $2,016,000 and $1,512,000,
respectively. During the period ended June 30, 1999, purchases and
sales of securities other than short-term were $2,389,000 and
$1,678,000, respectively.
Note 3 - Investment Advisory Fee
The Company's agreement with Chase Bank for investment management
and advisory services calls for an annual fee of 4/10ths of 1% of
the average portfolio value. The fee for the six months ended
June 30, 2000 amounted to $29,120.
Note 4 - Distributions
Distributions to shareholders were $282,172 or $.24 per share in
2000 and $364,472 or $.31 per share in 1999. Distributions include
$589 or $.0005 per share and $12,406 or $.0106 per share paid in
2000 and 1999 as supplemental distributions for 1999 and 1998
respectively.
Note 5 - Supplementary Information
Per share income and capital changes (for a share outstanding
throughout the period) ended:
June 30, June 30,
2000 1999
-------- --------
Investment income $ .33 $ .35
Expenses .06 .06
-------- --------
Net investment income .27 .29
Distribution to Shareholders ( .24) ( .31)
Net realized and unrealized gain
(loss) on investments .06 ( .29)
-------- --------
Net increase (decrease) in asset value $ .09 $( .31)
======== ========
Net assets value per share at end
of year $ 12.62 $ 12.69
======== ========
Ratio of expenses to average net assets .48% .49%
Ratio of net investment income to
average net assets 2.1% 2.2%
Portfolio turnover 10.35% 10.97%
Number of shares outstanding during the entire period was 1,175,664.
<PAGE>
DK INVESTORS, INC.
OFFICES: 205 Lexington Avenue, 16th Floor
New York, New York 10016
(212) 779-4233
OFFICERS: Gene Nadler President
Angelo J. Balafas Vice President
Harry Nadler Secretary
DIRECTORS: Gene Nadler Chairman
Harry Nadler
Thomas B. Schulhof
Angelo J. Balafas
Joseph Kell
Andrew Brucker, Esq.
Francine Yellon
LEGAL COUNSEL: POMERANZ GOTTLIEB & MUSHKIN, LLC
205 Lexington Avenue, 16th Floor
New York, New York 10016
AUDITORS: CUMMINGS & CARROLL, P.C.
175 Great Neck Road
Great Neck, New York 11021
INVESTMENT
ADVISORS: Chase Asset Management, Inc.
Division of Chase Manhattan Bank
1211 Avenue of the Americas
New York, New York 10036
TRANSFER AGENT
AND REGISTRAR: American Stock Transfer & Trust Co.
40 Wall Street, 46th Floor
New York, New York 10005
CUSTODIAN: Chase Manhattan Bank (formerly Chemical Bank)
ANNUAL MEETING:
On May 10, 2000, a regular Annual Meeting of the Shareholders of the
company was held at 205 Lexington Avenue, 16th Floor, New York, New York.
REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940 AS A DIVERSIFIED,
CLOSED END MANAGEMENT COMPANY. COPIES OF THE COMPANY'S ANNUAL REPORT
FORM N-2 ARE AVAILABLE TO REGISTERED STOCKHOLDERS UPON WRITTEN REQUEST
TO THE SECRETARY AT THE ABOVE ADDRESS.