<PAGE>
DELAWARE(SM)
INVESTMENTS
- -----------
Delaware High-Yield Opportunities Fund
Current Income
2000 SEMI-ANNUAL REPORT
(current income Artwork)
<PAGE>
A TRADITION OF SOUND INVESTING SINCE 1929
TABLE OF CONTENTS
Letter to Shareholders 1
Portfolio
Management Review 3
Performance Summary
Delaware High-Yield Opportunities Fund 6
Financial Statements
Statement of Net Assets 7
Statement of Assets
of Liabilities 10
Statement of Operations 10
Statements of Changes in
Net Assets 11
Financial Highlights 12
Notes to Financial
Statements 16
A Commitment To Our Investors
Experienced
o Our seasoned investment professionals average more than 15 years' experience.
o For over 70 years, we have managed money in a variety of investment styles
that have weathered a full range of economic and market environments. We
opened our first mutual fund in 1938.
Disciplined
o We follow strict investment policies and clear buy/sell guidelines.
o We strive to balance risk and reward in order to provide conservative
investment alternatives within any given asset class.
Consistent
o We believe consistent processes are the best way to seek consistent investment
performance.
o Our commitment to style consistency has earned us the confidence of
discriminating institutional and individual investors to manage approximately
$47 billion in assets as of December 31, 1999.
Comprehensive
o We offer over 70 mutual funds in these asset classes.
o Large-cap equity o High-yield bonds
o Mid-cap equity o Investment grade bonds
o Small-cap equity o Municipal bonds (24 single-state funds)
o International equity o International fixed-income
o Balanced
o Our funds are available through financial advisers who can offer you
individualized attention and valuable investment advice.
Funds are not FDIC insured and are not guaranteed. It is possible to lose the
principal amount invested.
(C)Delaware Distributors, L.P.
<PAGE>
Dear Shareholder
February 18, 2000
Recap of Events:
In a challenging market for high-yield bonds, when many mutual funds struggled
just to preserve capital, Delaware High-Yield Opportunities Fund delivered a
relatively strong total return of +3.09% for the six months ended January 31,
2000.
Tepid demand for higher yielding, higher risk investments has plagued the
high-yield bond market since the late summer months of 1998. Even though many of
the world's economies appeared well on their way to recovery, in general,
investors still seem concerned about the credit quality of their bond
investments.
In addition, many large company growth stocks and especially technology-related
stocks produced double-digit returns and gave investors little incentive to look
elsewhere. Delaware High-Yield Opportunities Fund overcame this unfavorable
environment by focusing on higher rated bonds within the high-yield category,
which paid less current income, but delivered an attractive total return.
During the third calendar quarter of 1999, higher interest rates and stock
market volatility reduced investor demand during a period of abundant new bond
supply. When supply is greater than demand, prices generally fall.
The balance of supply and demand improved during the fourth quarter due to a
seasonal end-of-year decline in new bond issuance. This helped relieve some of
the downward pressure on high-yield bond prices.
"IN A CHALLENGING
MARKET FOR
HIGH-YIELD BONDS,
DELAWARE HIGH-YIELD
OPPORTUNITIES FUND
DELIVERED A RELATIVELY
STRONG TOTAL RETURN
OF +3.09% FOR THE
SIX MONTHS ENDED
JANUARY 31, 2000."
<TABLE>
<CAPTION>
Average Total Returns
For Periods Ended January 31, 2000 Six Months Lifetime*
- -----------------------------------------------------------------------------------------------------
<S> <C> <C>
Delaware High-Yield Opportunities Fund Class A +3.09% +7.88%
- -----------------------------------------------------------------------------------------------------
Lipper High Current Yield Fund Average +0.34% (358 funds) +8.94% (4 funds)
Salomon Smith Barney High-Yield Bond Index -1.39% N/A
- -----------------------------------------------------------------------------------------------------
</TABLE>
All performance shown above is at net asset value and assumes reinvestment of
dividends and capital gains. Performance for all Delaware High-Yield
Opportunities Fund classes can be found on page 6. The Salomon Smith Barney
High-Yield Bond Index is an unmanaged measure of U.S. high-yield corporate
bonds. The Lipper category represents the average returns of high-yield bond
Funds tracked by Lipper Analytical Services. You cannot invest directly in an
index. Past performance does not guarantee future results.
*December 30, 1996 (commencement of operations)
1
<PAGE>
Delaware High-Yield Opportunities Fund strives to purchase high-yield corporate
bonds that have the potential to provide an attractive long-term total return.
High current income is a secondary consideration when we evaluate bonds for the
portfolio.
During the first six months of your Fund's fiscal year, this strategy led us to
increase our allocation to some of the market's best performers, such as
telecommunications bonds which offered limited income potential, but provided
attractive total returns. This helped the Fund outpace its unmanaged benchmark,
the Salomon Smith Barney High-Yield Bond Index, and the average return of its
peers in the Lipper High Current Yield Fund Average.
In general, high-yield bonds that offer the highest income potential also carry
the highest credit risk. Our preference for total return potential over income
potential led us to invest in some of the most stable industries in the
high-yield market. This was a positive for the Fund during the global flight to
quality back in 1998 and has continued to help the Fund weather persistent
concerns about some issuers' ability to meet payment obligations.
Market Outlook - A variety of factors contributed to the disappointing
performance of high-yield investments over the last year or so, such as credit
problems overseas, recent rising interest rates, abundant supply and weak
investor demand. Over the last six months, however, Delaware High-Yield
Opportunities Fund's investment strategy has proven resistant to these adverse
market conditions.
In the pages that follow, your Fund's portfolio managers, Paul Matlack and
Gerald Nichols, provide more details on the Fund's performance and offer their
outlook for the coming year. We are working to take full advantage of every
opportunity in the high-yield marketplace. We value your investment with
Delaware and look forward to helping you reach your financial goals.
Sincerely,
/s/ Wayne A. Stork /s/ David K. Downes
- ------------------------------ -------------------------------------
Wayne A. Stork David K. Downes
Chairman, President and Chief Executive Officer,
Delaware Investments Delaware Investments
Family of Funds Family of Funds
"OVER THE LAST
SIX MONTHS,
DELAWARE HIGH-YIELD
OPPORTUNITIES FUND'S
INVESTMENT STRATEGY
HAS PROVEN RESISTANT
TO ADVERSE MARKET
CONDITIONS."
(current income artwork)
2
<PAGE>
PORTFOLIO MANAGEMENT REVIEW
Paul A. Matlack
Senior Portfolio Manager
Gerald T. Nichols
Senior Portfolio Manager
February 18, 2000
The Fund's Results
Over the last six months, high-yield bonds continued to wrestle with market
conditions that set in nearly 18 months ago, when economic problems in Asia and
Russia became a global concern. Despite a booming U.S. economy and recovery
overseas, demand for higher risk investments remained weak. In calendar year
1999, approximately $5 billion was invested in high-yield bond mutual funds,
compared to more than $19 billion in 1998 (Source: Chase Securities).
Fortunately, the supply of new high-yield bond issues also fell last year. New
issues in calendar 1999 totaled nearly $100 billion, down from $150 billion in
1998 (Source: Chase Securities). Still, demand for high-yield bonds in 1999 was
not nearly sufficient to meet the available supply.
Liquidity, or the ability to sell securities without a significant loss of
value, continued to be a problem in the high-yield market. Many securities
dealers appeared reluctant to increase their inventory of high-yield bonds. This
reluctance, in our opinion, probably stems from losses incurred during the
summer of 1998 when high-yield bond prices fell sharply.
Rising interest rates, which generally reduce the value of all types of bonds,
may have also encouraged dealers to reduce their high-yield bond inventories,
adding to the liquidity problems. Fortunately, Delaware High-Yield Opportunities
Fund's relatively small size made it easier for us to sell securities that we no
longer viewed as attractive and reposition the portfolio to take advantage of
market opportunities.
Portfolio Highlights
We attribute Delaware High-Yield Opportunities Fund's six-month return primarily
to our focus on less volatile, lower yielding sectors of the high-yield bond
market. To a large extent, we sidestepped the market's liquidity problems by
avoiding sectors like textiles and supermarkets, whose prices fell when
inexpensive imports reduced their pricing power.
As Delaware High-Yield Opportunities Fund grows, we plan to keep a close eye on
the liquidity of the bonds in our portfolio. In our opinion, by focusing on
larger bond issues from well-known companies, we will be in better position to
keep your Fund's performance on track if we experience adverse market
conditions.
"DELAWARE HIGH-YIELD
OPPORTUNITIES FUND'S
RELATIVELY SMALL SIZE
MADE IT EASIER FOR US
TO SELL SECURITIES THAT
WE NO LONGER VIEWED
AS ATTRACTIVE AND
REPOSITION THE
PORTFOLIO TO TAKE
ADVANTAGE OF MARKET
OPPORTUNITIES."
3
<PAGE>
Portfolio Characteristics
January 31, 2000
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Current 30-Day SEC Yield* 9.24%
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Average Effective Duration 4.65 years
- ---------------------------------------------------------------------
Average Effective Maturity 6.83 years
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Portfolio Turnover 488%
- ---------------------------------------------------------------------
Number of Securities 77
- ---------------------------------------------------------------------
*For Class A shares measured according to Securities and Exchange Commission
(SEC) guidelines. Current 30-day SEC yield as of 1/31/00 for Class B and C
shares was 8.99% The Institutional Class yield was 10.02%.
We also benefited from the Fund's ability to invest in equity securities, which
helped boost performance this past six months. In most cases, we purchased
equities from companies whose bonds were already represented in our portfolio.
This allowed us to diversify our portfolio into equities and at the same time
increase our exposure to companies that, in our opinion, are positioned for
strong performance.
Outlook - Outward appearances point to a positive economic climate for
high-yield bonds. The U.S. economy extended its current record to 107
consecutive months of economic expansion. Foreign economies are also well on
their way back from the recession that touched nearly every country outside of
the U.S. in 1998.
Despite robust U.S. and global economic growth and periodic bouts of concern
over rising labor costs, inflation has remained surprisingly benign.
Productivity gains appear to be the factor keeping inflation in check. In fact,
according to the U.S. Department of Labor, U.S. worker productivity - a way of
measuring output per hour worked - rose at a faster-than-expected rate of 5%
during the fourth quarter of 1999. Despite a tight labor market, job costs in
1999 declined in both the third and fourth quarters, largely due to these
productivity gains.
"WE BENEFITED FROM
THE FUND'S ABILITY TO
INVEST IN EQUITY
SECURITIES, WHICH
HELPED BOOST
PERFORMANCE THIS
PAST SIX MONTHS."
Top Portfolio Holdings
January 31, 2000
Industry Percentage of Net Assets
- ---------------------------------------------------------------------
Buildings and Materials 3.31%
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Cable, Media & Publishing 8.55%
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Chemicals 6.49%
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Energy 5.42%
- ---------------------------------------------------------------------
Food, Beverage & Tobacco 4.96%
- ---------------------------------------------------------------------
Industrial Machinery 1.61%
- ---------------------------------------------------------------------
Leisure, Lodging & Entertainment 8.28%
- ---------------------------------------------------------------------
Telecommunications 29.29%
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Transportation & Shipping 8.08%
- ---------------------------------------------------------------------
Miscellaneous 12.47%
- ---------------------------------------------------------------------
4
<PAGE>
Last year rising default rates were a concern in the high-yield bond market.
In 1999, 86 domestic high-yield bond issuers defaulted on their loans compared
to 46 issuers in 1998. We believe that higher interest rates contributed to the
increase, by cutting into the profit margins of less financially secure
companies. Nevertheless, in our view, a strong global economy and low inflation
should help reduce defaults in 2000 by providing a positive backdrop for
companies issuing high-yield debt
Despite their current slump, we believe high-yield bonds remain an attractive
long-term investment. Because their performance is affected by both interest
rates (similar to bonds) and the economic climate for businesses (similar to
stocks), high-yield bonds occupy a unique niche in portfolios. We also believe
high-yield bond funds, like Delaware High-Yield Opportunities Fund add a layer
of asset class diversification that can help reduce the volatility risk of your
overall portfolio.
"WE BELIEVE HIGH-YIELD
BOND FUNDS, LIKE
DELAWARE HIGH-YIELD
OPPORTUNITIES FUND,
ADD A LAYER OF ASSET
CLASS DIVERSIFICATION
THAT CAN HELP REDUCE
THE VOLATILITY RISK OF
YOUR OVERALL PORTFOLIO."
5
<PAGE>
Delaware High-Yield Opportunities Fund
FUND BASICS
Fund Objective
Seeks total return, and as a
secondary objective, high
current income.
Assets Under Management
$27.4 million
Number of Holdings
77
Fund Start Date
December 30, 1996
Your Fund Managers
Paul Matlack is a graduate of the
University of Pennsylvania and
received his MBA in Finance from
George Washington University.
Mr. Matlack previously worked at
Mellon Bank and Provident
National Bank before joining
Delaware in 1989.
Gerald Nichols is a graduate of
the University of Kansas, where he
received a BS in Business
Administration and an MS in
finance. Prior to joining
Delaware in 1989, Mr. Nichols
worked at Waddell & Reed, Inc.
and as an investment officer for a
merchant banking firm.
Both Mr. Matlack and Mr.
Nichols are CFA charterholders.
NASDAQ Symbols
Class A DHOAX
Class B DHOBX
Class C DHOCX
FUND PERFORMANCE
Average Annual Returns
Through January 31, 2000 Lifetime One Year
- --------------------------------------------------------------------------------
Class A (Est. 12/30/96)
Excluding Sales Charge +7.88% +3.22%
Including Sales Charge +6.23% -1.60%
- --------------------------------------------------------------------------------
Class B (Est. 2/17/98)
Excluding Sales Charge +0.61% +2.55%
Including Sales Charge -1.16% -1.25%
- --------------------------------------------------------------------------------
Class C (Est. 2/17/98)
Excluding Sales Charge +0.59% +2.54%
Including Sales Charge +0.59% +1.59%
- --------------------------------------------------------------------------------
Delaware High-Yield Opportunities Fund invests primarily in high-yield bonds,
which involve greater risk than higher quality bonds. Returns reflect
reinvestment of distributions and any applicable sales charges as noted below.
Returns and share values will fluctuate so that shares, when redeemed, may be
worth more or less than the original share price. Class B and C results
excluding sales charges assume either that contingent sales charges did not
apply or the investment was not redeemed. Past performance does not guarantee
future results.
Class A shares have a 4.75% front-end maximum sales charge and a 12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They also are subject to a deferred sales
charge of up to 4% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution service fee. If redeemed within 12
months, a 1% contingent deferred sales charge applies.
The average annual total return for the lifetime and one-year periods ended
1/31/00 for Delaware High-Yield Opportunities Fund's Institutional Class were
+8.10% and +3.56%. The Institutional Class (Est. 12/30/96) is available without
a sales charge only to certain eligible institutional accounts. NASDAQ Symbol
Institutional Class: DHOIX.
(current income artwork)
<PAGE>
Statement of Net Assets
DELAWARE HIGH-YIELD OPPORTUNITIES FUND
Principal Market
January 31, 2000 (Unaudited) Amount Value
- --------------------------------------------------------------------------------
Corporate Bonds - 88.52%
Aerospace & Defense - 0.40%
Compass Aerospace sub nts
10.125% 4/15/05 ........................... $ 200,000 $ 110,000
----------
110,000
----------
Automobile & Auto Parts - 3.99%
Holley Performance Products sr nts
12.25% 9/15/07 ............................ 500,000 476,875
Stanadyne Automotive co guarantee
10.25% 12/15/07 ........................... 750,000 616,875
----------
1,093,750
----------
Building & Materials - 3.31%
Henry co guarantee 10.00% 4/15/08 ........... 400,000 296,000
Webb sr sub debs 9.375% 5/1/09 .............. 250,000 234,375
Williams Scotsman sr nts
9.875% 6/1/07 ............................. 400,000 378,500
----------
908,875
----------
Cable, Media & Publishing - 8.55%
Adelphia Communications sr nts
7.875% 5/1/09 ............................. 450,000 390,938
R.H. Donnelly sr nts 9.125% 6/1/08 .......... 325,000 321,750
Sinclair Broadcast Group sr sub nts
10.00% 9/30/05 ............................ 300,000 295,500
Sullivan Graphics sr sub nts
12.75% 8/1/05 ............................. 400,000 415,000
+Telewest sr disc nts 11.375% 2/1/10 ......... 875,000 516,250
United Pan-Europe sr nts
11.25% 2/1/10 ............................. 400,000 406,500
----------
2,345,938
----------
Chemicals - 6.49%
LaRoche Industries sr sub nts
9.50% 9/15/07 ............................. 200,000 66,000
Lyondell Chemical sr sub nts
10.875% 5/1/09 ............................ 350,000 348,250
Phillip Brothers sr sub nts
9.875% 6/1/08 ............................. 350,000 310,625
Precise Technology unsec sr sub nts
11.125% 6/15/07 ........................... 250,000 224,375
Sterling Chemicals co guarantee
12.375% 7/15/06 ........................... 400,000 418,000
ZSC Specialty Chemical co guarantee
11.00% 7/1/09 ............................. 400,000 412,000
----------
1,779,250
----------
<PAGE>
Principal Market
Amount Value
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
Consumer Products - 1.14%
Drypers sr nts 10.25% 6/15/07 .................... 250,000 $ 202,500
Revlon Consumer Products sr sub nts
8.625% 2/1/08 .................................. 250,000 110,000
----------
312,500
----------
Energy - 5.42%
Chesapeake Energy co guarantee
9.625% 5/1/05 .................................. 500,000 470,000
Plains Resources sr sub nts
10.25% 3/15/06 ................................. 500,000 486,250
RBF Finance co guarantee
11.375% 3/15/09 ................................ 500,000 530,000
----------
1,486,250
----------
Environmental Services - 1.60%
Allied Waste sr sub nts
10.00% 8/1/09 .................................. 500,000 438,750
----------
438,750
----------
Food, Beverage & Tobacco - 4.96%
Carrols co guarantee 9.50% 12/1/08 ............... 500,000 446,250
Chiquita Brands sr nts 10.00% 6/15/09 ............ 350,000 260,750
Fleming co guarantee 10.625% 7/31/07 ............. 200,000 179,250
National Wine & Spirit sr nts
10.125% 1/15/09 ................................ 475,000 475,000
----------
1,361,250
----------
Industrial Machinery - 1.61%
National Equipment co guarantee
10.00% 11/30/04 ................................ 450,000 441,000
----------
441,000
----------
Leisure, Lodging & Entertainment - 8.28%
Cinemark USA Series C sr sub nts
9.625% 8/1/08 .................................. 350,000 304,500
Hollywood Casino co guarantee
11.25% 5/1/07 .................................. 400,000 413,000
Hollywood Entertainment sr sub nts
10.625% 8/15/04 ................................ 500,000 445,000
Majestic Star co guarantee
10.875% 7/1/06 ................................. 400,000 390,500
Regal Cinemas sr sub nts 9.50% 6/1/08 ............ 275,000 190,438
The Sports Club co guarantee
11.375% 3/15/06 ................................ 500,000 495,000
United Artists Theatre sr sub nts
9.75% 4/15/08 .................................. 325,000 32,500
----------
2,270,938
----------
7
<PAGE>
Statement of Net Assets (continued)
Principal Market
Delaware High-Yield Opportunities Fund Amount Value
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
Metals & Mining - 2.75%
Algoma Steel 1st mtg 12.375% 7/15/05 .......... 400,000 $ 374,000
Doe Run Resources co guarantee
11.25% 3/15/05 .............................. 400,000 379,500
----------
753,500
----------
Packaging & Containers - 1.51%
+SF Holdings Group sr disc nts
12.75% 3/15/08 .............................. 750,000 414,375
----------
414,375
----------
Paper & Forest Products - 1.12%
Republic Group sr sub nts
9.50% 7/15/08 ............................... 325,000 307,937
----------
307,937
----------
Retail - 0.78%
Leslie's Poolmart sr nts
10.375% 7/15/04 ............................. 250,000 215,000
----------
215,000
----------
Telecommunications - 24.95%
Intermedia Communications sr nts
9.50% 3/1/09 ................................ 500,000 472,500
KMC Telecom Holdings sr nts
13.50% 5/15/09 .............................. 450,000 452,250
Level 3 Communications sr nts
9.125% 5/1/08 ............................... 500,000 462,500
Metromedia Fiber sr nts
10.00% 12/15/09 ............................. 500,000 505,000
+Nextel Communications sr disc nts
10.65% 9/15/07 .............................. 600,000 450,000
+Nextel Partners sr disc nts
14.00% 2/1/09 ............................... 800,000 533,000
+Nextlink Communications sr disc nts
12.125% 12/1/09 ............................. 900,000 522,000
Pathnet sr nts 12.25% 4/15/08 ................. 300,000 194,250
PSINet sr nts 10.50% 12/1/06 .................. 500,000 506,250
+Telecorp PCS sr disc notes
11.625% 4/15/09 ............................. 750,000 478,125
Teligent sr nts 11.50% 12/1/07 ................ 400,000 390,000
Verio sr nts 10.625% 11/15/09 ................. 400,000 415,000
+Viatel sr disc nts 12.50% 4/15/08 ............. 375,000 228,280
Voicestream Wire sr nts 10.375% 11/15/09 ...... 700,000 721,000
Williams Communications Group sr nts
10.875% 10/1/09 ............................. 500,000 515,000
----------
6,845,155
----------
Textiles, Apparel & Furniture - 0.77%
Pillowtex co guarantee 9.00% 12/15/07 ......... 500,000 210,000
----------
210,000
----------
<PAGE>
Principal Market
Amount Value
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
Transportation & Shipping - 8.08%
American Commercial Lines 10.25% 6/30/08 ...... 325,000 $ 308,750
Atlas Air sr nts 9.375% 11/15/06 .............. 350,000 330,750
Avis Rent A Car co guarantee
11.00% 5/1/09 ............................... 400,000 415,000
Budget Group sr nts 9.125% 4/1/06 ............. 500,000 460,000
Railworks co guarantee 11.50% 4/15/09 ......... 150,000 151,875
Railworks sr sub nts 11.50% 4/15/09 ........... 250,000 253,125
Sea Containers sr nts 10.75% 10/15/06 ......... 300,000 297,000
----------
2,216,500
----------
Utilities - 1.45%
Caithness sec 9.05% 12/15/09 .................. 400,000 396,500
----------
396,500
----------
Miscellaneous - 1.36%
Mark IV sr sub nts 7.75% 4/1/06 ............... 400,000 373,500
----------
373,500
----------
Total Corporate Bonds
(cost $25,322,835) .......................... 24,280,968
----------
Common Stock - 2.01%
Packaging & Containers - 0.01%
SF Holdings ................................... 1,050 1,050
----------
1,050
----------
Telecommunications - 2.00%
GST Telecommunications ........................ 13,200 114,675
Global Crossing Limited ....................... 2,800 142,100
Intermedia Communications ..................... 3,400 146,200
Verio ......................................... 2,300 148,063
----------
551,038
----------
Total Common Stock (cost $508,327) ............ 552,088
----------
Preferred Stock - 2.34%
Telecommunications - 2.34%
Nextel Communications ......................... 10 1,010
PSINet ........................................ 4,000 185,500
21st Century Telecommunications ............... 5,070 456,273
----------
Total Preferred Stock (cost $659,445) ......... 642,783
----------
Warrants - 0.01%
*Electronic Retailing System ................... 300 45
*Pathnet ....................................... 300 3,000
*Spincycle ..................................... 250 3
----------
Total Warrants (cost $12,767) ................. 3,048
----------
8
<PAGE>
Statement of Net Assets (continued)
Delaware High-Yield Opportunities Fund
- --------------------------------------------------------------------------------
Total Market Value of Securities - 92.88%
(cost $26,503,374) ................................... $25,478,887
Receivables and Other Assets
Net of Liabilities - 7.12% ........................... 1,951,726
-----------
Net Assets Applicable to 5,427,475 Shares
Outstanding - 100% ................................... $27,430,613
===========
Net Asset Value - High-Yield Opportunities Fund A Class
($13,361,003 / 2,643,598)............................. $5.05
-----
Net Asset Value - High-Yield Opportunities Fund B Class
($8,055,430 / 1,593,882) ............................. $5.05
-----
Net Asset Value - High-Yield Opportunities Fund C Class
($2,200,573 / 435,461) ............................... $5.05
-----
Net Asset Value - High-Yield Opportunities Fund Institutional
Class ($3,813,607 / 754,534) ......................... $5.05
-----
- ----------------------
*Non-income producing security for the period ended January 31, 2000.
+Zero coupon security as of January 31, 2000. The coupon shown is the step-up
rate.
^Undistributed net investment income includes net realized gains (losses) on
foreign currencies. Net realized gains (losses) on foreign currencies are
treated as net investment income in conjunction with provisions of the Internal
Revenue Code which treats them as ordinary income.
- --------------------------------------------------------------------------------
Components of Net Assets at January 31, 2000
Shares of Beneficial Interest (unlimited authorization -
no par) ........................................................ $29,759,263
Undistributed net investment income^ ............................ 7,596
Accumulated net realized loss on investments.................. (1,310,462)
Net unrealized depreciation of investments and
foreign currencies .......................................... (1,025,784)
-----------
Total net assets.............................................. $27,430,613
===========
Net Asset Value and Offering Price Per Share:
High-Yield Opportunities Fund
Net asset value A Class (A) ..................................... $5.05
Sales charge (4.75% of offering price or 4.95%
of the amount invested per share) (B) .......................... 0.25
-----
Offering price .................................................. $5.30
-----
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See the current Prospectus for purchase of $100,00 or more.
Summary of Abbreviations:
co-guarantee - company guarantee
debs - debentures
disc - discount
mtg - mortgage
nts - notes
sec - secured
sr - senior
sub - subordinated
unsec - unsecured
See accompanying notes
9
<PAGE>
Statement of Assets and Liabilities
<TABLE>
<CAPTION>
Six Months Ended January 31, 2000 (Unaudited) Delaware High-Yield Opportunities Fund
- --------------------------------------------------------------------------------------------------
<S> <C>
Assets:
Investments at market (cost $26,503,374) ...................................... $25,478,887
Cash and foreign currencies ................................................... 1,177,740
Receivable for securities sold ................................................ 6,366,806
Dividends and interest receivable ............................................. 583,303
Subscriptions receivable ...................................................... 43,207
-----------
Total assets .................................................................. 33,649,943
-----------
Liabilities:
Payable for securities purchased .............................................. 6,032,223
Liquidations payable .......................................................... 89,337
Other accounts payable and accrued expenses ................................... 97,770
-----------
Total liabilities ............................................................. 6,219,330
-----------
Total Net Assets .............................................................. $27,430,613
===========
</TABLE>
Statement of Operations
<TABLE>
<CAPTION>
Six Months Ended January 31, 2000 (Unaudited) Delaware High-Yield Opportunities Fund
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
Investment Income:
Interest ..................................................... $1,231,125
Dividends .................................................... 13,934 $1,245,059
----------
Expenses:
Management fees .............................................. 79,576
Distribution expense ......................................... 58,724
Registration fees ........................................... 37,504
Dividend disbursing and transfer agent fees and expenses ..... 19,175
Reports and statements to shareholders ....................... 16,696
Accounting and administration ................................ 7,429
Custodian fees ............................................... 6,467
Taxes (other than taxes on income) ........................... 3,150
Professional fees ............................................ 2,462
Trustees' fees ............................................... 1,490
Other ........................................................ 7,435 240,108
---------- ---------
Less expenses absorbed or waived ............................. (53,593)
Less expenses paid indirectly ................................ (2,828)
---------
Total expenses ............................................... 183,687
---------
Net Investment Income ....................................... 1,061,372
---------
Net Realized and Unrealized Gain (Loss) on Investments and
Foreign Currencies:
Net realized loss on:
Investments ................................................. (492,011)
Foreign Currencies .......................................... (97)
---------
Net realized loss ........................................... (492,108)
Net change in unrealized appreciation/depreciation of
investments ................................................. 195,527
---------
Net Realized and Unrealized Loss on Investments and Foreign
Currencies .................................................. (296,581)
---------
Net Increase in Net Assets Resulting from Operations ......... $764,791
========
</TABLE>
See accompanying notes
10
<PAGE>
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Delaware High-Yield Opportunities Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year
Ended Ended
1/31/00 7/31/99
(Unaudited)
<S> <C> <C>
Increase (Decrease) in Net Assets from Operations:
Net investment income ............................................................................. $ 1,061,372 $ 1,592,270
Net realized loss on investments and foreign currencies ........................................... (492,108) (818,418)
Net change in unrealized appreciation/(depreciation) of investments and foreign currencies ........ 195,527 (1,440,010)
---------------------------
Net increase (decrease) in net assets resulting from operations ................................... 764,791 (666,158)
---------------------------
Distributions to Shareholders from:
Net investment income:
A Class ......................................................................................... (547,497) (929,578)
B Class ......................................................................................... (263,359) (271,969)
C Class ......................................................................................... (80,351) (90,611)
Institutional Class ............................................................................. (169,064) (311,216)
Net realized gain on investments:
A Class ......................................................................................... -- (219,201)
B Class ......................................................................................... -- (58,238)
C Class ......................................................................................... -- (18,815)
Institutional Class ............................................................................. -- (69,788)
---------------------------
(1,060,271) (1,969,416)
---------------------------
Capital Share Transactions:
Proceeds from shares sold:
A Class ......................................................................................... 3,122,397 6,326,031
B Class ......................................................................................... 3,455,204 6,467,171
C Class ......................................................................................... 1,336,545 1,946,694
Institutional Class ............................................................................. 1,497 26,516
Net asset value of shares issued upon reinvestment of distributions
from net investment income and net realized gain on investments:
A Class ......................................................................................... 478,596 997,958
B Class ......................................................................................... 147,897 160,232
C Class ......................................................................................... 53,202 63,760
Institutional Class 168,603 356,221
---------------------------
8,763,941 16,344,583
---------------------------
Cost of shares repurchased:
A Class ......................................................................................... (2,641,510) (2,872,684)
B Class ......................................................................................... (1,776,517) (1,534,693)
C Class ......................................................................................... (1,076,747) (502,146)
Institutional Class ............................................................................. (867) --
---------------------------
(5,495,641) (4,909,523)
---------------------------
Increase in net assets derived from capital share transactions .................................... 3,268,300 11,435,060
---------------------------
Net Increase in Net Assets ........................................................................ 2,972,820 8,799,486
Net Assets:
Beginning of period ............................................................................... 24,457,793 15,658,307
---------------------------
End of period ..................................................................................... $27,430,613 $24,457,793
===========================
</TABLE>
See accompanying notes
11
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware High-Yield Opportunities Fund A Class
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months 12/30/96(2)
Ended Year Ended to
1/31/00(1) 7/31/99 7/31/98 7/31/97
(Unaudited)
<S> <C> <C> <C> <C>
Net asset value, beginning of period ............................................. $5.120 $ 5.920 $5.920 $5.500
Income (loss) from investment operations:
Net investment income .......................................................... 0.222 0.434 0.523 0.290(3)
Net realized and unrealized gain (loss) on investments and foreign currencies... (0.070) (0.691) 0.336 0.299
-------------------------------------------
Total from investment operations ............................................... 0.152 (0.257) 0.859 0.589
-------------------------------------------
Less dividends and distributions:
Dividends from net investment income ........................................... (0.222) (0.438) (0.605) (0.169)
Distributions from net realized gain on investments ............................ -- (0.105) (0.254) --
-------------------------------------------
Total dividends and distributions .............................................. (0.222) (0.543) (0.859) (0.169)
-------------------------------------------
Net asset value, end of period ................................................... $5.050 $ 5.120 $5.920 $5.920
===========================================
Total return(4) .................................................................. 3.09% (4.26%) 15.66% 10.81%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ........................................ $13,361 $12,558 $9,670 $5,990
Ratio of expenses to average net assets ........................................ 1.35% 1.27% 1.14% 0.75%
Ratio of expenses to average net assets prior
to expense limitation and fees paid indirectly ............................... 1.79% 1.89% 1.44% 1.57%
Ratio of net investment income to average net assets ........................... 8.79% 8.02% 8.88% 8.53%
Ratio of net investment income to average net assets prior to expense
limitation and fees paid indirectly .......................................... 8.33% 7.39% 8.58% 7.70%
Portfolio turnover ............................................................. 488% 382% 317% 270%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Date of initial public offering: ratios have been annualized but total
return has not been annualized. Total return for this short of a time period
may not be representative of longer term results.
(3) The average shares outstanding method has been applied for per share
information.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
See accompanying notes
12
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware High-Yield Opportunities Fund B Class
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year 2/17/98(2)
Ended Ended to
1/31/00(1) 7/31/99 7/31/98
(Unaudited)
<S> <C> <C> <C>
Net asset value, beginning of period ......................................................... $5.120 $5.920 $5.870
Income (loss) from investment operations:
Net investment income ...................................................................... 0.205 0.401 0.161
Net realized and unrealized gain (loss) on investments and foreign currencies .............. (0.069) (0.694) 0.044
-------------------------------
Total from investment operations ........................................................... 0.136 (0.293) 0.205
-------------------------------
Less dividends and distributions:
Dividends from net investment income ....................................................... (0.206) (0.402) (0.155)
Distributions from net realized gain on investments ........................................ -- (0.105) --
-------------------------------
Total dividends and distributions .......................................................... (0.205) (0.507) (0.155)
-------------------------------
Net asset value, end of period ............................................................... $5.050 $5.120 $5.920
===============================
Total return(3) .............................................................................. 2.77% (4.91%) 3.54%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................................................... $8,055 $6,296 $1,603
Ratio of expenses to average net assets .................................................... 2.05% 1.97% 1.84%
Ratio of expenses to average net assets prior
to expense limitation and fees paid indirectly ........................................... 2.49% 2.59% 2.14%
Ratio of net investment income to average net assets ....................................... 8.09% 7.32% 8.18%
Ratio of net investment income to average net assets prior to expense
limitation and fees paid indirectly ...................................................... 7.63% 6.69% 7.88%
Portfolio turnover ......................................................................... 488% 382% 317%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Date of initial public offering: ratios have been annualized but total
return has not been annualized. Total return for this short of a time period
may not be representative of longer term results.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
See accompanying notes
13
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware High-Yield Opportunities Fund C Class
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year 2/17/98(2)
Ended Ended to
1/31/00(1) 7/31/99 7/31/98
(Unaudited)
<S> <C> <C> <C>
Net asset value, beginning of period ......................................................... $5.120 $5.920 $5.870
Income (loss) from investment operations:
Net investment income ...................................................................... 0.204 0.403 0.161
Net realized and unrealized gain (loss) on investments and foreign currencies .............. (0.069) (0.696) 0.044
-------------------------------
Total from investment operations ........................................................... 0.135 (0.293) 0.205
-------------------------------
Less dividends and distributions:
Dividends from net investment income ....................................................... (0.205) (0.402) (0.155)
Distributions from net realized gain on investments ........................................ -- (0.105) --
-------------------------------
Total dividends and distributions .......................................................... (0.205) (0.507) (0.155)
-------------------------------
Net asset value, end of period ............................................................... $5.050 $5.120 $5.920
===============================
Total return(3) .............................................................................. 2.76% (4.91%) 3.54%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................................................... $2,201 $1,913 $547
Ratio of expenses to average net assets .................................................... 2.05% 1.97% 1.84%
Ratio of expenses to average net assets prior
to expense limitation and fees paid indirectly ........................................... 2.49% 2.59% 2.14%
Ratio of net investment income to average net assets ....................................... 8.09% 7.32% 8.18%
Ratio of net investment income to average net assets prior to expense
limitation and fees paid indirectly ...................................................... 7.63% 6.69% 7.88%
Portfolio turnover ......................................................................... 488% 382% 317%
</TABLE>
- ----------------------
(1) Ratios have ben annualized and total return has not been annualized.
(2) Date of initial public offering: ratios have been annualized but total
return has not been annualized. Total return for this short of a time period
may not be representative of longer term results.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
See accompanying notes
14
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware High-Yield Opportunities Fund Institutional Class
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months 12/30/96(2)
Ended Year Ended to
1/31/00(1) 7/31/99 7/31/98 7/31/97
(Unaudited)
<S> <C> <C> <C> <C>
Net asset value, beginning of period ............................................. $5.120 $5.920 $5.920 $5.500
Income from investment operations:
Net investment income .......................................................... 0.229 0.444 0.537 0.290(3)
Net realized and unrealized gain (loss) on investments and foreign currencies... (0.069) (0.684) 0.330 0.299
-------------------------------------------
Total from investment operations ............................................... 0.160 (0.240) 0.867 0.589
-------------------------------------------
Less dividends and distributions:
Dividends from net investment income ........................................... (0.230) (0.455) (0.613) (0.169)
Distributions from net realized gain on investments ............................ -- (0.105) (0.254) --
-------------------------------------------
Total dividends and distributions .............................................. (0.230) (0.560) (0.867) (0.169)
-------------------------------------------
Net asset value, end of period ................................................... $5.050 $5.120 $5.920 $5.920
===========================================
Total return ..................................................................... 3.27% (3.96%) 15.82% 10.81%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ........................................ $3,814 $3,691 $3,837 $3,330
Ratio of expenses to average net assets ........................................ 1.05% 0.97% 0.84% 0.75%
Ratio of expenses to average net assets prior
to expense limitation and fees paid indirectly ............................... 1.49% 1.59% 1.14% 1.27%
Ratio of net investment income to average net assets ........................... 9.09% 8.32% 9.18% 8.53%
Ratio of net investment income to average net assets prior to expense
limitation and fees paid indirectly .......................................... 8.63% 7.69% 8.88% 8.00%
Portfolio turnover ............................................................. 488% 382% 317% 270%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized
(2) Date of initial public offering: ratios have been annualized but total
return has not been annualized. Total return for this short of a time period
may not be representative of longer term results.
(3) The average shares outstanding method has been applied for per share
information.
See accompanying notes
15
<PAGE>
Notes to Financial Statements
January 31, 2000 (Unaudited)
- --------------------------------------------------------------------------------
Delaware Group Income Funds (the "Company") is registered as a diversified
open-end investment company under the Investment Company Act of 1940, as
amended. The Fund is organized as a Delaware Business Trust and offers five
series: the Delaware Corporate Bond Fund, the Delaware Extended Duration Bond
Fund, the Delaware Delchester Fund, the Delaware High-Yield Opportunities Fund
and the Delaware Strategic Income Fund. These financial statements and related
notes pertain to the Delaware High-Yield Opportunities Fund (the "Fund"). The
Fund offers four classes of shares. The Delaware High-Yield Opportunities Fund A
Class carries a front-end sales charge of 4.75%. The Delaware High-Yield
Opportunities Fund B Class carries a back-end deferred sales charge.
The Delaware High-Yield Opportunities Fund C Class carries a level load deferred
sales charge and the Delaware High-Yield Opportunities Fund Institutional Class
has no sales charge.
The investment objective of the High-Yield Opportunities Fund is to seek total
return, and as a secondary objective, high current income.
1. Significant Accounting Policies
The following accounting policies are in accordance with generally accepted
accounting principles and are consistently followed by the Fund.
Security Valuation - All equity securities are valued at the last quoted sales
price as of the close of the New York Stock Exchange (NYSE) on the valuation
date. If on a particular day an equity security does not trade, then the mean
between the bid and asked prices will be used. Long-term debt securities are
valued by an independent pricing service and such prices are believed to reflect
the fair value of such securities. Money market instruments having less than 60
days to maturity 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 by or under the
direction of the Fund's Board of Trustees.
Federal Income Taxes - The Fund intends to continue to qualify as a regulated
investment company and make the requisite distributions to shareholders.
Accordingly, no provision for federal income taxes has been made in the
financial statements. Income and capital gain distributions are determined in
accordance with federal income tax regulations, which may differ from generally
accepted accounting principles.
Class Accounting - Investment income, common expenses and
realized and unrealized gain (loss) on investments are allocated to the various
classes of the Fund on the basis of daily net assets of each class. Distribution
expenses relating to a specific class are charged directly to that class.
Repurchase Agreements - The Fund may invest in a pooled cash account along with
other members of the Delaware Investments Family of Funds. The aggregate daily
balance of the pooled cash account is invested in repurchase agreements secured
by obligations of the U.S. government. The respective collateral is held by the
Fund's custodian bank until the maturity of the respective repurchase
agreements. Each repurchase agreement is at least 102% collateralized. However,
in the event of default or bankruptcy by the counterparty to the agreement,
realization of the collateral may be subject to legal proceedings.
<PAGE>
Foreign Currency Transactions - Transactions denominated in foreign currencies
are recorded at the prevailing exchange rates on the valuation date. The value
of all assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the exchange rate of such currencies against the U.S.
dollar as of 12:00 PM EST. Transaction gains or losses resulting from changes in
exchange rates during the reporting period or upon settlement of the foreign
currency transaction are reported in operations for the current period. The Fund
does isolate that portion of gains and losses on investments in debt securities,
which are due to changes in the foreign exchange rate from that which are due to
changes in market prices of debt securities. The Fund reports certain foreign
currency related transactions as components of realized gains (losses) for
financial reporting purposes, whereas such components are treated as ordinary
income (loss) for federal income tax purposes.
Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
Other - Expenses common to all funds within the Delaware Investments Family of
Funds are allocated amongst the funds on the basis of average net assets.
Security transactions are recorded on the date the securities are purchased or
sold (trade date). Costs used in calculating realized gains and losses on the
sale of investment securities are those of the specific securities sold.
Dividend income is recorded on the ex-dividend date and interest income is
recorded on the accrual basis. Original issue discounts are accreted to interest
income over the lives of the respective securities. The Fund declares dividends
daily from net investment income and pays such dividends monthly and declares
and pays distributions from net realized gain on investments, if any, annually.
Certain expenses of the Fund are paid through "soft dollar" arrangements with
brokers. These transactions are done subject to the best price and execution.
The amount of these expenses was approximately $561 for the six months ended
January 31, 2000. In addition, the Fund receives earnings credits from its
custodian when positive cash balances are maintained, which are used to offset
custody fees. The earnings credits for six months ended January 31, 2000 were
$2,267. The expenses paid under the above arrangements are included in their
respective expense captions on the Statement of Operations with the
corresponding expense offset shown as "expenses paid indirectly".
2. Investment Management and Other Transactions with Affiliates
In accordance with the terms of the Investment Management Agreement, the Fund
pays Delaware Management Company (DMC), the Investment Manager of the Fund, an
annual fee which is calculated daily at the rate of 0.65% on the first $500
million of the average daily net assets, 0.60% on the next $500 million, 0.55%
on the next $1,500 million, and 0.50% of the average net assets in excess of
$2,500 million. At January 31, 2000, the liability for investment management
fees and other expenses payable to DMC was $7,385.
16
<PAGE>
Notes to Financial Statements (continued)
January 31, 2000 (Unaudited)
- --------------------------------------------------------------------------------
DMC has elected to waive that portion, if any, of the management fee and
reimburse the Fund to the extent that annual expenses, exclusive of taxes,
interest, brokerage commissions, distribution and extraordinary expenses, exceed
1.00% of average daily net assets of the Fund through September 30, 2000.
The Fund has engaged Delaware Service Company, Inc. (DSC), an affiliate of DMC,
to provide dividend disbursing, transfer agent and accounting services. The fund
pays DSC a monthly fee based on the number of shareholder accounts, shareholder
transactions, and average net assets, subject to certain minimums. At January
31, 2000, the Fund had a liability for such fees and other expenses payable to
DSC of $3,380.
Pursuant to the Distribution Agreement, the Fund pays Delaware Distributors,
L.P. (DDLP), the Distributor and an affiliate of DMC, an annual fee not to
exceed 0.30% of the average daily net assets of the A Class and 1.00% of the
average daily net assets of the B and C Classes.
For the six months ended January 31, 2000, commissions earned by DDLP on sales
of the Fund's A Class shares were $3,273.
Certain officers of DMC, DSC and DDLP are officers, trustees and/or employees of
the Funds. These officers, trustees and employees are paid no compensation by
the Fund.
3. Investments
During the six months ended January 31, 2000, the Fund made purchases and sales
of $57,525,933 and $55,848,122, respectively of investment securities other than
U.S. government securities and temporary cash investments.
The cost of investments for federal income tax purposes approximates the cost
for book purposes. At January 31, 2000, the aggregate cost of securities for
federal income tax purposes was $26,503,374. At January 31, 2000, net unrealized
depreciation for federal income tax purposes aggregated $1,024,487 of which
$313,550 related to unrealized appreciation of securities and $1,338,037 related
to unrealized depreciation of securities.
<PAGE>
4. Capital Shares
Transactions in capital shares were as follows:
Six Months Year
Ended Ended
1/31/00 7/31/99
(Unaudited)
Shares sold:
A Class .................................... 625,315 1,173,029
B Class .................................... 688,939 1,218,230
C Class .................................... 265,778 364,066
Institutional Class ........................ 298 5,052
Shares issued upon reinvestment of
dividends from net investment income
and net realized gain on investments:
A Class .................................... 95,872 187,800
B Class .................................... 29,608 30,387
C Class .................................... 10,660 12,081
Institutional Class ........................ 33,777 66,867
---------- ----------
1,750,247 3,057,512
---------- ----------
Shares repurchased:
A Class .................................... (529,378) (543,858)
B Class .................................... (353,815) (290,396)
C Class .................................... (214,501) (95,113)
Institutional Class ........................ (175) --
---------- ----------
(1,097,869) (929,367)
---------- ----------
Net increase ................................. 652,378 2,128,145
========== ==========
5. Lines of Credit
The Fund has a committed line of credit for $1.2 million. No amount was
outstanding at January 31, 2000, or at any time during the fiscal year.
6. Credit and Market Risk
The Fund invests in high-yield fixed income securities, which carry ratings of
BB or lower by S&P and/or Ba or lower by Moody's. Investments in these higher
yielding securities may be accompanied by a greater degree of credit risk than
higher rated securities. Additionally, lower rated securities may be more
susceptible to adverse economic and competitive industry conditions than
investment grade securities.
The Fund invests up to 15% of its total assets in illiquid securities which may
include securities with contractual restrictions on resale, securities exempt
from registration under Rule 144A of the Securities Act of 1933, as amended, and
other securities which may not be readily marketable. The relative illiquidity
of some of these securities may adversely affect the Fund's ability to dispose
of such securities in a timely manner and at a fair price when it is necessary
to liquidate such securities.
<PAGE>
DELAWARE(SM) For Shareholders
INVESTMENTS 1.800.523.1918
- -----------
Philadelphia o London
For Securities Dealers
1.800.362.7500
For Financial Institutions
Representatives Only
1.800.659.2265
www.delawareinvestments.com
- --------------------------------------------------------------------------------
This semi-annual report is for the information of Delaware High-Yield
Opportunities Fund shareholders, but it may be used with prospective investors
when preceded or accompanied by a current Prospectus for Delaware High-Yield
Opportunities Fund and the Delaware Investments Performance Update for the most
recently completed calendar quarter. The prospectus sets forth details about
charges, expenses, investment objectives and operating policies of the Fund. You
should read the prospectus carefully before you invest. The figures in this
report represent past results which are not a guarantee of future results. The
return and principal value of an investment in the Fund will fluctuate so that
shares, when redeemed, may be worth more or less than their original cost.
BOARD OF TRUSTEES
Wayne A. Stork
Chairman
Delaware Investments Family of Funds
Philadelphia, PA
Walter P. Babich
Board Chairman,
Citadel Constructors, Inc.
King of Prussia, PA
David K. Downes
President and Chief Executive Officer
Delaware Investments Family of Funds
Philadelphia, PA
John H. Durham
Private Investor
Horsham, PA
Anthony D. Knerr
Consultant, Anthony Knerr & Associates
New York, NY
Ann R. Leven
Former Treasurer, National Gallery of Art
Washington, DC
Thomas F. Madison
President and Chief Executive Officer
MLM Partners, Inc.
Minneapolis, MN
Charles E. Peck
Retired
Fredericksburg, VA
Janet L. Yeomans
Vice President and Treasurer
3M Corporation
St. Paul, MN
<PAGE>
AFFILIATED OFFICERS
Charles E. Haldeman, Jr.
President and Chief Executive Officer
Delaware Management Holdings, Inc.
Philadelphia, PA
Richard J. Flannery
Executive Vice President and
General Counsel
Delaware Investments Family of Funds
Philadelphia, PA
Bruce D. Barton
President and Chief Executive Officer
Delaware Distributors, L.P.
Philadelphia, PA
Investment Manager
Delaware Management Company
Philadelphia, PA
International Affiliate
Delaware International Advisers Ltd.
London, England
National Distributor
Delaware Distributors, L.P.
Philadelphia, PA
Shareholder Servicing, Dividend
Disbursing and Transfer Agent
Delaware Service Company, Inc.
Philadelphia, PA
1818 Market Street
Philadelphia, PA 19103-3682
(2800) (J5624) Printed in the USA
SA-137 [1/00] PP 3/00
