<PAGE> 1
1995
Annual --------
Report DELAWARE
GROUP
TREND
FUND
--------
[PHOTO OF VARIOUS PHILADELPHIA HISTORICAL SITES]
A Tradition of Sound Investing Since 1929
DELAWARE
GROUP
---------------------
Philadelphia - London
<PAGE> 2
TREND FUND
-------------------------------------
INVESTMENT
-------------------------------------
OBJECTIVE
-------------------------------------
TO PROVIDE LONG-TERM CAPITAL APPRECIATION BY INVESTING PRIMARILY IN SECURITIES
OF EMERGING AND OTHER GROWTH-ORIENTED COMPANIES.
[PHOTO OF VARIOUS PHILADELPHIA HISTORICAL SITES]
ABOUT OUR COVER
-------------------------------------
Headquartered in Philadelphia, Pennsylvania, Delaware Group shares in the
tradition of a city built on the vision of opportunity. Amidst the city's
historic sites, symbolic of our nation's freedom and prosperity, Delaware Group
provides both individual and institutional investors with a conservative,
disciplined approach to money management.
DELAWARE GROUP
-------------------------------------
A TRADITION OF
-------------------------------------
SOUND INVESTING
-------------------------------------
Delaware's investment experience dates back to 1929. Our first mutual fund was
established in 1938. Headquartered in Philadelphia with an affiliate in London,
Delaware provides a full range of mutual fund investments, annuities and
retirement plan services. Delaware International Advisers Ltd., our
London-based international affiliate, was established in 1990.
Delaware Group manages mutual funds with the same time-tested, disciplined
strategies demanded by the large public and private pension plans, foundations
and endowments that are among our clients. With over 60 years of investment
management standing behind us, we have experience you can count on and a
commitment to excellent service.
Today, Delaware manages some $26 billion in mutual funds and institutional
investment advisory accounts. We measure our success by the financial success
and satisfaction of our nearly 500,000 shareholders.
<PAGE> 3
JULY 31, 1995
DEAR
-------------------------------------
SHAREHOLDER:
-------------------------------------
Over the course of our 1995 fiscal year ended June 30, 1995, the environment
for small-capitalization growth stocks improved dramatically. Clearly, this
wasn't the case in the first half of our fiscal year, as the Federal Reserve's
repeated interest rate increases pushed the long-term U.S. Treasury bond yield
to a peak of 8.2% in November of 1994. As concern about future economic growth
rose, the investing climate for small market capitalization stocks grew worse.
Interest rates then began to decline and by June 30, 1995, the long U.S.
Treasury bond yielded 6.6% and small-cap growth stocks showed their ability to
rebound strongly, albeit not to the same degree as large-cap stocks.
--------------------------------------------
TOTAL RETURN
FISCAL YEAR ENDED JUNE 30, 1995
<TABLE>
<S> <C>
Trend Fund A Class +24.40%
NASDAQ Industrial Index +23.91%
Lipper Capital Appreciation
Fund Average +22.17%
</TABLE>
Performance for Trend Fund and the Lipper
Capital Appreciation Fund Average (which
includes 145 funds) is based on net asset
value without impact of sales charge.
Performance information for all classes of
the Fund can be found on page 7.
--------------------------------------------
Your Fund, which invests in the stocks of emerging and other small growth
companies, took advantage of the market's strong rally. For the fiscal year,
Trend Fund A Class had a total return (capital change plus income) that
surpassed that of the broad, small stock market as represented by the NASDAQ
Industrial Index, an unmanaged index comprised of stocks similar in market
capitalization to those in Trend Fund. As you can see in the table above, the
Fund's return also surpassed the Lipper Capital Appreciation Fund Average, a
broad-based composite of 145 growth funds.
In addition to the 1.4 percentage point decline in long-term interest
rates, the value of the U.S. dollar declined relative to foreign currencies.
This lowered the cost of exported American products, which translated into
record earnings levels for U.S. companies.
Though large companies, which generally have greater exposure to foreign
economies than their small-cap counterparts, benefited more from the
depreciating dollar, the Standard & Poor's 500 Stock Index, an unmanaged index
comprised primarily of large-capitalization "blue chip" stocks, delivered a
return of +26.06%, only slightly better than Trend Fund's during this fiscal
period.
We are encouraged about the prospect for small company investing,
particularly given developments that we believe should strengthen the dollar
and the potential for a pick-up in the relative earnings momentum of small
stocks. For example:
* THE U.S. IS ON THE VERGE OF AN INDUSTRIAL RENAISSANCE. Our country is
increasingly becoming the production locale of choice among industrialized
countries due to lower relative labor costs that result from currency
adjustments, superior technological expertise and lower relative
valuations. We believe this will fuel our nation's trade output, which
should drive the dollar upward - a positive for small-cap stocks.
1
<PAGE> 4
* BUDGET DISCUSSIONS ON CAPITOL HILL.
The new Congress is considering streamlining, if not eliminating, various
agencies such as the Departments of Commerce and Energy, the FCC and NASA, to
name a few. We believe we are witnessing a replay of the private sector
downsizing of the 1980s and 1990s at the public level. Assuming that downsizing
would reduce the budget deficit, not only could this be positive for the
dollar, but interest rates could decline allowing for further expansion of
stock multiples.
Given such exciting prospects in the economy and business, and the rising
potential for significant savings at the Federal level, we believe there will
continue to be many interesting opportunities for Trend Fund shareholders. This
report contains an update from the senior portfolio manager of the Fund, who
explains the Fund's positioning over the past 12 months and its impact on
performance.
OVER THE PAST SEVERAL YEARS, THE FALL OF THE U.S. DOLLAR HAD A MORE POSITIVE
IMPACT ON THE PERFORMANCE OF LARGE-CAP STOCKS THAN SMALL-CAP STOCKS. HISTORY
TELLS US THAT THIS IS QUITE NORMAL DURING A PERIOD OF DOLLAR WEAKNESS. THE
CHART TO THE RIGHT SHOWS THE VALUATION LEVELS OF THE U.S. DOLLAR SINCE 1967 AND
THE CORRESPONDING RELATIVE PERFORMANCE OF SMALL-CAP STOCKS. SMALL STOCKS HAVE
TENDED TO OUTPERFORM DURING A PERIOD OF DOLLAR STRENGTH, AND UNDERPERFORM
DURING PERIODS WHEN THE DOLLAR IS DECLINING.
/s/ Wayne A. Stork
Chairman, Board of Directors
Delaware Group Trend Fund
/s/ Brian F. Wruble
President and Chief Executive Officer
Delaware Group Trend Fund
With one eye on short-term excesses and the other on our commitment to
favorable long-term performance, we look forward to serving you in the Fund's
28th year of operation. As always, we thank for your continued confidence.
SMALL-CAP STOCK PERFORMANCE VERSUS THE TRADE-WEIGHTED U.S. DOLLAR
<TABLE>
<CAPTION>
Performance of Small Stocks Trade-Weighted Dollar
--------------------------- ---------------------
Relative to Large Stocks
------------------------
<S> <C> <C>
Jan. '67 1.09 1.00
Dec. '67 1.35 1.02
Jun. '68 1.53 1.02
Dec. '68 1.70 1.02
Jun. '69 1.46 1.02
Dec. '69 1.36 1.02
Jun. '70 1.15 1.01
Dec. '70 1.20 1.01
Jun. '71 1.29 0.99
Dec. '71 1.24 0.94
Jun. '72 1.22 0.90
Dec. '72 1.08 0.92
Jun. '73 0.84 0.80
Dec. '73 0.84 0.85
Jun. '74 0.91 0.83
Dec. '74 0.87 0.82
Jun. '75 1.09 0.79
Dec. '75 1.06 0.86
Jun. '76 1.23 1.89
Dec. '76 1.31 0.88
Jun. '77 1.52 0.87
Dec. '77 1.66 0.82
Jun. '78 1.97 0.79
Dec. '78 1.84 0.74
Jun. '79 2.13 0.75
Dec. '79 2.25(small stocks outperform) 0.72
Jun. '80 2.14 0.71
Dec. '80 2.26 0.76
Jun. '81 2.69 0.89
Dec. '81 2.56 0.88
Jun. '82 2.55 0.98
Dec. '82 2.78 0.99
Jun. '83 3.21 1.04(dollar strong)
Dec. '83 2.97(small stocks underperform) 1.11
Jun. '84 2.80 1.12
Dec. '84 2.60 1.24
Jun. '85 2.62 1.23
Dec. '85 2.60 1.05(dollar weakens)
Jun. '86 2.62 0.95
Dec. '86 2.36 0.89
Jun. '87 2.28 0.82
Dec. '87 2.07 0.74
Jun. '88 2.32 0.77
Dec. '88 2.10 0.77
Jun. '89 2.15 0.86
Dec. '89 1.92 0.79
Jun. '90 1.87 0.77
Dec. '90 1.57 0.70
Jun. '91 1.79 0.79
Dec. '91 1.78 0.71
Jun. '92 1.82 0.72
Dec. '92 2.00 0.75
Jun. '93 2.05 0.77
Dec. '93 2.20 0.80
Jun. '94 2.14 0.76
Dec. '94 2.14 0.75
Mar. '95 2.07 0.73
</TABLE>
There is no guarantee that this pattern will be repeated.
Source: Prudential Securities Inc.; CRSP; Department of Commerce; Business
Cycle Indicator
* The trade-weighted U.S. dollar is a government measure of the dollar's
overall value based on its relation to the currencies of foreign
countries, weighted by the value of U.S. trade within each country.
2
<PAGE> 5
PORTFOLIO
-------------------------------------
MANAGER'S
-------------------------------------
REPORT
-------------------------------------
The last 12 months has been a gratifying period for Trend Fund shareholders as
lower long-term interest rates resulted in higher valuations for the stock
market and, in particular, small-cap growth stocks. These stocks, which are the
primary focus of your Fund, generally have higher price-to-earnings ratios than
any other stock group and, therefore, are generally more sensitive to interest
rate moves. When interest rates rise, as they did in 1994, small-cap growth
stocks tend to underperform the broad market. Conversely, when interest rates
fall, small-cap growth stocks typically outperform the market. During your
Fund's fiscal year, one factor disrupted this cycle - a simultaneous weakening
of the U.S. dollar, brought on by rebounding global economies.
INSIDE THE
TREND FUND
PORTFOLIO
In seeking long-term capital growth, Trend Fund focuses on companies in the
early stages of their growth cycle. These tend to be smaller companies that are
not widely recognized or researched by the broader investment community, which
looks to larger, more established companies. We spend our time studying the
long-term business trends, strategic focus and competitive environment of the
small companies we consider for purchase. The majority of this analysis is
based on information we acquire from in-person meetings with the companies'
management teams, competitors, suppliers and industry experts.
[PHOTO OF EDWARD ANTOIAN] "IN SEEKING LONG-TERM CAPITAL GROWTH, TREND FUND
FOCUSES ON COMPANIES IN THE EARLY STAGES OF THEIR
GROWTH CYCLE. THESE TEND TO BE SMALLER COMPANIES
THAT ARE NOT WIDELY RECOGNIZED OR RESEARCHED BY
THE BROADER INVESTMENT COMMUNITY."
Edward Antoian
Contrary to the way "momentum" investors approach stock selection - buying
a stock based heavily on short-term analysis of a company, such as the rate or
acceleration of stock valuations and/or earnings - we base our investment
decisions on the underlying fundamentals, e.g., product market share and the
consumer. And we base our decisions on a longer time horizon, generally two
years or more.
Because we analyze each company individually, within the framework of our
broad demographic and social outlook, your Fund is typically well-diversified
among individual securities. In fact, as of June 30, Trend Fund held stock
positions in approximately 175 companies spanning 12 sectors. The following
discussion profiles a few of our more interesting opportunities.
3
<PAGE> 6
* HBO & COMPANY. One of the fastest growing companies in the health care
information services industry, HBO & Co. designs and sells computerized
information systems. The company also staffs, manages and operates the
data processing departments of many health care organizations in the U.S.
and abroad. This stock was the Fund's top performer for the period. With
health care reform upon us, health care providers have finally begun to
recognize the cost-efficiency of automating their clinical and financial
recordkeeping. This has contributed to HBO & Company's strong revenue and
earnings growth so far this year.
* CENTRAL SPRINKLER. Central Sprinkler has emerged as the lead innovator in
the fire sprinkler industry. Even though commercial construction activity
has been sluggish, Central Sprinkler's integrated strategy of not only
manufacturing basic sprinkler components such as heads and valves, but
providing software capable of designing sprinkler systems for its clients,
has allowed the company to take sizeable market share. The company was our
top holding, representing 2.10% of net assets as of June 30, 1995.
The common thread between these two companies is their strong management
teams and focus on solid growth opportunities. Of course, we also encountered
some disappointments over the past year, some of which we have maintained and
others we have sold. There are two main reasons why we might sell a stock. One
is when the market recognizes the stock's potential and its appreciation is so
strong that further growth is not attractive, relative to potential risks. In
this case, we earn a profit when we sell the stock. The other is when the
stock is unsuccessful because the market didn't recognize it and consequently,
its growth slowed or altogether stopped, whereby we may take a loss. Because
the stocks we select don't always perform to our expectations, broad
diversification is critical to our strategy.
* BROOKSTONE INCORPORATED. A specialty retailer of impulse gift items,
Brookstone suffered from weak mall traffic and a lack of new items able to
attract consumers' interest. As a result, the company reported a loss of
$3.33 million, or 44 cents per share, in the first quarter of 1995. We
originally purchased Brookstone in March 1994 and gradually added to our
position through August 1994. As it became clear that this company's
growth prospects had slowed, we "took our lumps" and began to sell off our
position in December, with the last of our shares sold early in January
1995. Since then, Brookstone declined even more.
* SAVOY PICTURES ENTERTAINMENT INCORPORATED. While this major motion picture
company released some box office hits over the past 12 months, including a
"Bronx Tale" and "Shadowlands," it also produced less successful films
such as "Serial Mom" and "Exit to Eden." Our interest in this company
continues however, given what we see as strong management and proven
ability to make money in the entertainment industry.
4
<PAGE> 7
----------------------------------------------------------
TREND FUND PORTFOLIO
<TABLE>
<S> <C>
Basic Industry/Capital Goods 5.52%
Business Services 12.75%
Consumer Durables/Cyclical 2.61%
Consumer Non-Durables 13.14%
Consumer Services 18.08%
Energy 0.89%
Other* 7.32%
Financial 1.84%
Healthcare 10.36%
Technology/Communications 2.75%
Technology/Hardware 10.75%
Technology/Software 13.99%
</TABLE>
* Includes common stock in utilities/telecommunications,
stock warrants, preferred stock, convertible bonds,
repurchase agreements and cash.
Based on total net assets as of June 30, 1995
----------------------------------------------------------
AS OF JUNE 30, TREND FUND HELD STOCK POSITIONS IN APPROXIMATELY 175 COMPANIES,
SPANNING 12 SECTORS.
THE TECHNOLOGY SECTOR
Technology stocks led the market's rally over the past 12 months. In
particular, semiconductor companies reported record earnings, and the market
embraced these companies based on their recent and anticipated near-term
results. While the fabulous returns are certainly tempting, we refuse to take
the short-term view and ignore the ultimate decline in earnings that should be
expected from these traditionally cyclical companies.
Our portfolio participation in the technology sector has been more
conservative, focused on hardware, software and communications companies. And
whereas the NASDAQ Industrial Index was weighted, on average, around 30% in
technology stocks, we held an average weighting of only 22% over the past
fiscal year, and still we managed to outperform the Index.
OUR OUTLOOK FOR
SMALL-CAP GROWTH STOCKS
We believe that the recent cycle of strong performance for large stocks may be
slowing due to an anticipated peak in earnings momentum for that sector,
relative to small stocks. We see this as a growing opportunity for small
stocks.
/s/ EDWARD N. ANTOIAN
---------------------
Edward N. Antoian
Senior Portfolio Manager
Trend Fund
5
<PAGE> 8
LONG-TERM
-------------------------------------
PERFORMANCE
-------------------------------------
The second half of our 1995 fiscal year was an exciting period for investors,
as both the stock and bond markets rallied in a lower interest rate climate.
Trend Fund A Class recovered particularly well from the difficulties it
encountered in the first fiscal half, jumping from a +2.86% return at net asset
value for the six months ended December 31, 1994, to a +20.94% return for the
six months ended June 30, 1995. This sharp reversal in the Fund's performance
is not uncommon given the aggressive nature of the securities in which the Fund
invests. In fact, the chart on the opposite page reveals that the Fund's strong
long-term performance has been built on short-term ups and downs such as this
one.
With all distributions reinvested, a $10,000 investment in Trend Fund A
Class 10 years ago would have grown to $40,331 by June 30, 1995. During the
same time period, a $10,000 investment in the stocks comprising the unmanaged
NASDAQ Industrial Index would have grown to $29,130.
Obviously, had you been discouraged by your Fund's performance in the
first fiscal half and deviated from your long-term plan in Trend Fund, you
would have missed out on our rally in the second half. This period illustrates
the importance of staying the course through short-term market fluctuations.
Over the long term, your Fund's goal is to reward you with the returns you
would expect from such a growth-oriented investment.
[PHOTO OF VARIOUS PHILADELPHIA HISTORICAL SITES] THE SECOND HALF OF OUR 1995
FISCAL YEAR WAS AN EXCITING
PERIOD FOR INVESTORS, AS BOTH
THE STOCK AND BOND MARKETS
RALLIED IN A LOWER INTEREST
RATE CLIMATE.
6
<PAGE> 9
-------------------------------------------------------------------------------
A LOOK AT LONG-TERM PERFORMANCE
Growth of a $10,000 Investment July 1985 through June 1995
<TABLE>
<CAPTION>
Trend Fund A Class Return NASDAQ Industrial Index Return
-----------------------------------------------------------------
<S> <C> <C>
July '85 $ 9,428 $10,000
Dec. '85 10,202 10,867
Dec. '86 10,741 11,498
Dec. '87 9,903 11,156
Dec. '88 12,560 12,473
Dec. '89 18,801 14,745
Dec. '90 14,174 13,365
Dec. '91 24,732 22,018
Dec. '92 30,272 23,861
Dec. '93 37,042 26,524
Dec. '94 33,349 24,811
June '95 40,331 29,130
-------------------------------------------------------------------------------
</TABLE>
$10,000 invested in Trend Fund A Class 7/1/85 through 6/30/95 reflects the
impact of the Fund's maximum 5.75% front-end sales charge. A 12b-1 plan which
was implemented on June 1, 1992 will impact performance after that date. Both
Trend Fund and the Index reflect the reinvestment of all distributions. No
adjustments were made for the payment of taxes. The NASDAQ Industrial Index is
an unmanaged index comprised of primarily small company stocks. Performance for
other classes of Trend Fund will vary due to differing charges and expenses.
DELAWARE GROUP TREND FUND
Total Return through June 30, 1995
<TABLE>
<CAPTION>
CLASS A (EST. 1968) CLASS B (EST. 1994)
Average Annual Total Returns(1) Aggregate Total Returns(2)
<S> <C> <C> <C>
10 Years +14.96% Lifetime +16.68%
Excluding
5 Years +14.44% Sales Charge
1 Year +17.29% +12.68%
Including
Sales Charge
</TABLE>
RETURN AND SHARE VALUE FLUCTUATE SO THAT SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THE ORIGINAL INVESTMENT. PAST PERFORMANCE IS NOT A GUARANTEE
OF FUTURE RESULTS.
(1) Class A returns reflect the 5.75% maximum front-end sales charge and the
reinvestment of all distributions. Returns after June 1, 1992 reflect the
impact of the 12b-1 fee implemented on that date.
(2) Class B returns "including sales charge" reflect the reinvestment of all
distributions, the impact of the maximum 4% contingent deferred sales charge
and a 1% annual distribution and service fee, for the period from introduction
of Class B on September 6, 1994, through June 30, 1995. Returns "excluding
sales charge" assume that the investment was not redeemed. Performance for this
short time period may not be representative of longer term performance of this
class.
The average annual total returns for Trend Fund's Institutional Class, which is
available without sales or asset-based distribution charges only to certain
eligible institutional accounts, were +15.71%, +15.94% and +24.74% ,
respectively, for the 10-, five- and one-year periods ended June 30, 1995. The
Institutional Class was initially made available on November 9, 1992.
Performance for the Institutional Class for periods prior to this date are
based on Class A performance, adjusted to eliminate the sales charge, but not
the asset-based distribution charge.
7
<PAGE> 10
DOLLAR-COST
-------------------------------------
AVERAGING:
-------------------------------------
GETTING MORE FOR
-------------------------------------
YOUR MONEY
-------------------------------------
Many people put off making investment decisions about individual stocks or
mutual funds because they're worried about investing at the wrong time. Hoping
to "buy low and sell high," these people are motivated by a desire to make the
most of their investments. But if they hesitate because they're afraid of
buying at a market high, they can miss out on potential returns. People who
wait for the market's low can find themselves in the same situation.
History shows that it's nearly impossible to predict market highs and
lows. However, you can help remove the guesswork easily by investing a set
amount of money on a regularly scheduled basis. Financial planning specialists
call this concept dollar-cost averaging. Since the chances of investing at
either the absolute high or low price in any given year are extremely slim,
with dollar-cost averaging, instead of investing all of your money at once, you
spread your investment over time.
Dollar-cost averaging works because by investing a set dollar amount at
regular intervals, you end up buying more shares when the price is low and
fewer when the price is high. This can reduce your average cost per share.
For example, let's say that you invest $500 at quarterly intervals (see
the table to the right). You make your investments in March, June, September
and December. In March, assume that one share costs $10, so your $500
investment buys 50 shares. In June, the price is $12.50 which buys you 40
shares. When the market goes "down" in September and the price of a single
share drops to $5, you end up getting more shares for your money. Then, the
share price moves back to $10 and once again, your $500 buys 50 shares.
After investing a total of $2000 to obtain 240 shares, your average cost
would be $8.33 per share, $1.05 less than the $9.38 average price of a share.
In a fluctuating market such as this one, dollar-cost averaging can help you
avoid making a large investment before a decline in the market. Instead, by
spreading out your investment, you'll actually be taking advantage of market
declines.
---------------------------------------------------------------------------
DOLLAR-COST AVERAGING CAN REDUCE YOUR
AVERAGE COST PER SHARE
<TABLE>
<CAPTION>
INVESTMENT SHARE SHARES
AMOUNT PRICE PURCHASED
<S> <C> <C> <C>
MARCH $ 500 $10.00 50
JUNE $ 500 $12.50 40
SEPTEMBER $ 500 $ 5.00 100
DECEMBER $ 500 $10.00 50
------------------------------------------------------------------------
$2,000 $37.50 240
------------------------------------------------------------------------
AVERAGE PRICE PER SHARE
($37.50 DIVIDED BY 4) $ 9.38
AVERAGE COST PER SHARE
($2,000 DIVIDED BY 240) $ 8.33
------------------------------------------------------------------------
</TABLE>
The hypothetical investment does not represent the performance of Trend
Fund.
---------------------------------------------------------------------------
Dollar-cost averaging involves continuous investment in securities
regardless of fluctuating price levels, so it works best when you pick an
amount you can afford to invest consistently and stick to it. Dollar-cost
averaging can't guarantee a profit or protect you from loss in a declining
market, but it can help reduce your average cost per share, helping you get
more for your money.
8
<PAGE> 11
FINANCIAL
-------------------------------------
STATEMENTS
-------------------------------------
DELAWARE GROUP TREND FUND, INC.
STATEMENT OF NET ASSETS
JUNE 30, 1995
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES VALUE
<S> <C> <C>
COMMON STOCK - 92.69%
BASIC INDUSTRY/CAPITAL GOODS - 5.52%
AAR . . . . . . . . . . . . . . . . . . . . . 145,300 $ 2,597,238
* AES China Generating Class A . . . . . . . . . 299,700 3,034,463
* Cable Design Technologies . . . . . . . . . . 46,600 978,600
* Central Sprinkler . . . . . . . . . . . . . . 327,800 7,867,200
* Kellstrom Industries . . . . . . . . . . . . . 298,200 1,584,188
Lesco . . . . . . . . . . . . . . . . . . . . 84,300 1,306,650
* Molecular Dynamics . . . . . . . . . . . . . . 210,100 1,483,831
* Signal Technology . . . . . . . . . . . . . . 197,000 812,625
* TII Industries . . . . . . . . . . . . . . . . 189,400 1,302,125
-------------
20,966,920
-------------
BUSINESS SERVICES/DISTRIBUTORS - 0.49%
* Government Technology Services . . . . . . . . 175,300 1,007,975
* Global Directmail . . . . . . . . . . . . . . 42,700 843,325
-------------
1,851,300
-------------
BUSINESS SERVICES/ENVIRONMENTAL - 0.81%
* York Research . . . . . . . . . . . . . . . . 501,700 3,072,913
-------------
3,072,913
-------------
BUSINESS SERVICES/MEDIA & PUBLISHING -
3.31%
* Central European Media Entertainment . . . . . 39,900 603,488
* Evergreen Media Class A . . . . . . . . . . . 70,000 1,828,750
* Infinity Broadcasting Class A . . . . . . . . 141,750 4,730,906
* Playboy Enterprises . . . . . . . . . . . . . 195,700 1,541,138
* Young Broadcasting Class A . . . . . . . . . . 141,600 3,876,300
-------------
12,580,582
-------------
BUSINESS SERVICES/OTHER - 8.14%
* AirTouch Communications . . . . . . . . . . . 155,300 4,426,050
* Checkmate Electronics . . . . . . . . . . . . 75,000 862,500
* GTECH Holdings . . . . . . . . . . . . . . . . 79,900 2,337,075
* Highway Master Communications . . . . . . . . 37,900 582,713
* ITI Technologies . . . . . . . . . . . . . . . 199,900 4,772,613
* NFO Research . . . . . . . . . . . . . . . . . 123,450 2,469,000
* Norrell . . . . . . . . . . . . . . . . . . . 88,700 1,718,563
* Paging Network . . . . . . . . . . . . . . . . 118,200 4,018,800
* Palmer Wireless . . . . . . . . . . . . . . . 72,000 1,179,000
* Pittston . . . . . . . . . . . . . . . . . . . 200,000 4,800,000
* ProNet . . . . . . . . . . . . . . . . . . . . 100,000 2,031,250
* SOS Staffing Services . . . . . . . . . . . . 94,700 651,063
* United States Cellular . . . . . . . . . . . . 35,000 1,058,750
-------------
30,907,377
-------------
CONSUMER DURABLES/CYCLICAL - 2.61%
* ADESA . . . . . . . . . . . . . . . . . . . . 197,200 3,327,750
* Champion Road Machinery . . . . . . . . . . . 155,500 1,486,969
* Custom Chrome . . . . . . . . . . . . . . . . 79,900 1,578,025
* Edelbrock . . . . . . . . . . . . . . . . . . 37,200 490,575
Huffy . . . . . . . . . . . . . . . . . . . . 162,800 2,116,400
* Syratech . . . . . . . . . . . . . . . . . . . 50,000 918,750
-------------
9,918,469
-------------
CONSUMER NON-DURABLES/RETAIL - 5.50%
* American Eagle Outfitters . . . . . . . . . . 79,300 1,229,150
* Duty Free International . . . . . . . . . . . 134,500 1,176,875
* Finish Line Class A . . . . . . . . . . . . . 164,000 1,619,500
Fred's Class A . . . . . . . . . . . . . . . . 100,000 1,025,000
* General Nutrition Companies . . . . . . . . . 150,000 5,231,250
* MacFrugals Bargains Closeout . . . . . . . . . 94,600 1,655,500
* Petco Animal Supplies . . . . . . . . . . . . 40,500 931,500
* Piercing Pagoda . . . . . . . . . . . . . . . 73,800 774,900
Schultz Sav-O Stores . . . . . . . . . . . . . 209,200 4,628,550
* Staples . . . . . . . . . . . . . . . . . . . 90,000 2,604,375
-------------
20,876,600
-------------
CONSUMER NON-DURABLES/TEXTILES AND
APPAREL - 1.13%
* Hyde Athletic Industries . . . . . . . . . . . 231,000 981,750
* Quicksilver . . . . . . . . . . . . . . . . . 58,600 1,530,925
Wolverine Worldwide . . . . . . . . . . . . . 85,650 1,777,238
-------------
4,289,913
-------------
CONSUMER NON-DURABLES/OTHER - 6.51%
* American Recreation . . . . . . . . . . . . . 250,000 2,093,750
Anthony Industries . . . . . . . . . . . . . . 118,400 2,175,600
Armor All Products . . . . . . . . . . . . . . 125,000 2,125,000
* Bell Sports . . . . . . . . . . . . . . . . . 147,400 1,731,950
* Bollinger Industries . . . . . . . . . . . . . 66,200 273,075
Dreyer's Grand Ice Cream . . . . . . . . . . . 154,300 5,651,238
* Equity Marketing . . . . . . . . . . . . . . . 197,800 1,594,763
* ERO . . . . . . . . . . . . . . . . . . . . . 86,600 757,750
* Forschner Group . . . . . . . . . . . . . . . 61,800 660,488
* Galoob (Lewis) Toys . . . . . . . . . . . . . 190,100 1,520,800
* Lincoln Snacks . . . . . . . . . . . . . . . . 217,200 665,175
* Marker International . . . . . . . . . . . . . 54,000 357,750
* Marvel Entertainment . . . . . . . . . . . . . 97,988 1,518,814
* Rawlings Sporting Goods . . . . . . . . . . . 49,300 403,644
Reader's Digest Class B . . . . . . . . . . . 50,000 2,043,750
Tyco Toys . . . . . . . . . . . . . . . . . . 79,100 543,813
* Zanart Entertainment Units . . . . . . . . . . 76,000 593,750
-------------
24,711,110
-------------
CONSUMER SERVICES/ENTERTAINMENT &
LEISURE - 12.08%
* Adelphia Communications Class A . . . . . . . 234,700 2,112,300
* All American Communications . . . . . . . . . 124,400 1,259,550
* Cablemaxx . . . . . . . . . . . . . . . . . . 40,000 280,000
* Cinergi Pictures Entertainment . . . . . . . . 380,300 2,590,794
Comcast Class A voting . . . . . . . . . . . . 246,200 4,493,150
* Comcast UK Cable Partners . . . . . . . . . . 108,400 1,761,500
* Echostar Communications Class A . . . . . . . 123,100 1,846,500
</TABLE>
9
<PAGE> 12
STATEMENT OF NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES VALUE
<S> <C> <C>
COMMON STOCK (CONTINUED)
CONSUMER SERVICES/ENTERTAINMENT &
LEISURE (CONTINUED)
* Goldwyn (Samuel) . . . . . . . . . . . . . . . 292,200 $ 2,081,925
* Hospitality Franchise . . . . . . . . . . . . 49,568 1,716,292
* Mirage Resorts . . . . . . . . . . . . . . . . 239,200 7,325,500
* Monarch Casino & Resort . . . . . . . . . . . 210,700 1,053,500
* National Wireless Holding . . . . . . . . . . 50,300 691,625
* Players International . . . . . . . . . . . . 60,000 1,207,500
* Rio Hotel & Casino . . . . . . . . . . . . . . 280,200 3,817,725
* Savoy Pictures Entertainment . . . . . . . . . 489,200 4,372,225
* Speedway Motorsports . . . . . . . . . . . . . 58,700 1,269,388
* Turner Broadcasting Class A . . . . . . . . . 82,800 1,656,000
* United International Holdings Class A . . . . . 123,200 2,017,400
* Viacom International non-voting . . . . . . . 7,600 352,450
* WMS Industries . . . . . . . . . . . . . . . . 201,000 3,944,625
-------------
45,849,949
-------------
CONSUMER SERVICES/RESTAURANTS - 4.04%
* Bertucci's Holding Company . . . . . . . . . . 60,600 454,500
CKE Restaurants . . . . . . . . . . . . . . . 94,800 853,200
* Dave & Buster's . . . . . . . . . . . . . . . 4,800 94,800
* Hometown Buffet . . . . . . . . . . . . . . . 295,700 3,437,513
* Lone Star Steakhouse & Saloon . . . . . . . . 140,400 4,247,100
* Noble Romans . . . . . . . . . . . . . . . . . 163,500 807,281
* Rock Bottom Restaurants . . . . . . . . . . . 74,600 2,154,075
Sonic . . . . . . . . . . . . . . . . . . . . 100,700 2,744,075
* Wall Street Deli . . . . . . . . . . . . . . . 58,500 526,500
-------------
15,319,044
-------------
CONSUMER SERVICES/OTHER - 1.96%
Barefoot . . . . . . . . . . . . . . . . . . . 88,000 1,215,500
* CUC International . . . . . . . . . . . . . . 129,700 5,447,400
* Prime Management Group . . . . . . . . . . . . 78,900 212,044
* Protection One . . . . . . . . . . . . . . . . 71,100 431,044
* TDX . . . . . . . . . . . . . . . . . . . . . 170,100 127,575
-------------
7,433,563
-------------
ENERGY - 0.89%
* American Oilfield Divers . . . . . . . . . . . 249,700 1,591,838
Mitchell Energy & Development Class A . . . . . 100,000 1,787,500
-------------
3,379,338
-------------
FINANCIAL/INSURANCE - 0.66%
* Old Lyme Holding . . . . . . . . . . . . . . . 170,000 1,551,250
* Penn Treaty American . . . . . . . . . . . . . 75,800 966,450
-------------
2,517,700
-------------
FINANCIAL/OTHER - 1.18%
* Advance Ross . . . . . . . . . . . . . . . . . 131,100 3,539,700
* CRW Financial . . . . . . . . . . . . . . . . 102,020 497,348
SEI . . . . . . . . . . . . . . . . . . . . . 19,500 443,625
-------------
4,480,673
-------------
HEALTHCARE/DEVICES - 3.69%
* ATS Medical . . . . . . . . . . . . . . . . . 128,100 1,096,856
* Avecor Cardiovascular . . . . . . . . . . . . 165,800 2,227,938
* Guidant . . . . . . . . . . . . . . . . . . . 125,700 3,016,800
* Metra Biosystems . . . . . . . . . . . . . . . 71,000 852,000
* Ostex International . . . . . . . . . . . . . 86,600 2,013,450
* Ventritex . . . . . . . . . . . . . . . . . . 285,100 4,793,244
-------------
14,000,288
-------------
HEALTHCARE/PHARMACEUTICALS - 3.56%
* Ariad Pharmaceuticals . . . . . . . . . . . . 189,400 479,419
* Cephalon . . . . . . . . . . . . . . . . . . . 130,200 2,392,425
* Columbia Laboratories . . . . . . . . . . . . 284,400 2,115,225
* Cor Therapeutics . . . . . . . . . . . . . . . 60,300 538,931
* Ethical Holdings plc . . . . . . . . . . . . . 248,200 1,458,175
* Gilead Sciences . . . . . . . . . . . . . . . 138,000 2,423,625
* Interneuron Pharmaceutical . . . . . . . . . . 50,000 515,625
* Noven Pharmaceuticals . . . . . . . . . . . . 180,000 1,372,500
* Oncor . . . . . . . . . . . . . . . . . . . . 100,000 606,250
* Vertex Pharmaceuticals . . . . . . . . . . . . 98,500 1,625,250
-------------
13,527,425
-------------
HEALTHCARE/SERVICES - 3.02%
* American Oncology Resources . . . . . . . . . 15,200 423,700
* Apria Healthcare Group . . . . . . . . . . . . 92,800 2,598,400
* FPA Medical Management . . . . . . . . . . . . 147,400 1,492,425
* FoxMeyer Health . . . . . . . . . . . . . . . 120,000 2,145,000
* Integracare . . . . . . . . . . . . . . . . . 68,000 446,250
* Renal Treatment Centers . . . . . . . . . . . 146,000 3,613,500
* Universal Standard Medical Labs . . . . . . . 125,000 750,000
-------------
11,469,275
-------------
HEALTHCARE/OTHER - 0.09%
* Pharmakinetics Laboratories . . . . . . . . . 740,740 324,074
-------------
324,074
-------------
TECHNOLOGY/COMMUNICATIONS - 2.75%
* Digital Microwave . . . . . . . . . . . . . . 145,700 1,821,250
* EIS International . . . . . . . . . . . . . . 98,300 1,591,231
* Gandalf Technologies . . . . . . . . . . . . . 389,200 3,502,800
* General DataComm Industries . . . . . . . . . 97,300 1,216,250
* IntelCom Group . . . . . . . . . . . . . . . . 204,600 1,828,613
* Teltrend . . . . . . . . . . . . . . . . . . . 23,700 462,150
-------------
10,422,294
-------------
TECHNOLOGY/HARDWARE - 10.75%
* ACT Manufacturing . . . . . . . . . . . . . . 48,600 622,688
* Anadigics . . . . . . . . . . . . . . . . . . 10,400 206,700
* Citation Computer Systems . . . . . . . . . . 172,000 913,750
* Concurrent Computer . . . . . . . . . . . . . 990,200 2,444,556
* EMC . . . . . . . . . . . . . . . . . . . . . 190,300 4,614,775
* General Instruments . . . . . . . . . . . . . 140,000 5,372,500
* Integrated Circuit Systems . . . . . . . . . . 213,200 3,118,050
* Iomega . . . . . . . . . . . . . . . . . . . . 175,900 3,902,781
* Micronics Computers . . . . . . . . . . . . . 220,600 882,400
* Mylex . . . . . . . . . . . . . . . . . . . . 137,300 1,802,063
* Radius . . . . . . . . . . . . . . . . . . . . 170,215 1,872,365
* Read-Rite . . . . . . . . . . . . . . . . . . 94,600 2,524,638
Scientific-Atlanta . . . . . . . . . . . . . . 170,000 3,740,000
* Storage Technology . . . . . . . . . . . . . . 189,400 4,663,975
* Triquint Semiconductor . . . . . . . . . . . . 252,300 4,099,875
-------------
40,781,116
-------------
</TABLE>
10
<PAGE> 13
STATEMENT OF NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
NUMBER MARKET
OF SHARES VALUE
<S> <C> <C>
COMMON STOCK (CONTINUED)
TECHNOLOGY/SOFTWARE - 13.99%
* Acclaim Entertainment . . . . . . . . . . . . 142,000 $ 2,609,250
Activision . . . . . . . . . . . . . . . . . . 493,118 3,421,006
* Bachman Information Systems . . . . . . . . . 16,600 127,613
* Broadway & Seymour . . . . . . . . . . . . . . 192,200 3,916,075
* Cadence Design Systems . . . . . . . . . . . . 196,800 6,371,400
* Cheyenne Software . . . . . . . . . . . . . . 190,300 3,520,550
* Computer Horizons . . . . . . . . . . . . . . 23,700 370,313
* Chromatics Color Sciences . . . . . . . . . . 200,000 837,500
* Excalibur Technologies . . . . . . . . . . . . 231,900 3,652,425
* Fulcrum Technologies . . . . . . . . . . . . . 133,000 2,876,125
HBO & Company . . . . . . . . . . . . . . . . 25,796 1,409,106
* Mysoftware . . . . . . . . . . . . . . . . . . 39,200 485,100
* Oracle Systems . . . . . . . . . . . . . . . . 100,000 3,856,250
* Phamis . . . . . . . . . . . . . . . . . . . . 35,000 868,438
* Prophet 21 . . . . . . . . . . . . . . . . . . 169,900 796,406
* Ross Systems . . . . . . . . . . . . . . . . . 300,000 1,575,000
* Sierra On-Line Class A . . . . . . . . . . . . 200,000 5,025,000
* SPSS . . . . . . . . . . . . . . . . . . . . . 183,500 2,741,031
* Symantec . . . . . . . . . . . . . . . . . . . 258,900 7,459,556
* Trinzic . . . . . . . . . . . . . . . . . . . 203,400 1,182,263
-------------
53,100,407
-------------
UTILITIES/TELECOMMUNICATIONS - 0.01%
Bell Atlantic . . . . . . . . . . . . . . . . 612 34,272
-------------
34,272
-------------
TOTAL COMMON STOCK
(cost $281,905,891) . . . . . . . . . . . . 351,814,602
-------------
STOCK WARRANTS - 0.03%
* ATS Medical Warrants . . . . . . . . . . . . . 146,000 104,938
-------------
TOTAL STOCK WARRANTS (COST $ -0-) . . . . . . . 104,938
-------------
PREFERRED STOCK - 0.30%
Cellular Communications $.10 pfd cv . . . . . . 25,000 1,131,250
-------------
TOTAL PREFERRED STOCK (COST $271,875) . . . . . 1,131,250
-------------
CONVERTIBLE BONDS - 0.53%
Time Warner 0% Reset Note 2002 . . . . . . . . 2,062,000 2,028,763
-------------
TOTAL CONVERTIBLE BONDS
(cost $1,697,819) . . . . . . . . . . . . . 2,028,763
-------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
<S> <C> <C>
REPURCHASE AGREEMENTS - 6.14%
With Chase Manhattan Bank 6.125%
7/3/95 (dated 6/30/95,
collateralized by $7,789,000 U.S.
Treasury Notes 6.125% due 5/15/98,
market value $7,892,384) . . . . . . . . . . $7,685,000 7,685,000
With Deutsche Bank 6.15% 7/3/95
(dated 6/30/95, collateralized by
$4,414,000 U.S. Treasury Bills due
12/14/95, market value
$4,302,886 and $3,599,000 U.S.
Treasury Notes 7.50% due 12/31/96,
market value $3,681,282) . . . . . . . . . . 7,807,000 7,807,000
With PaineWebber 6.20% 7/3/95
(dated 6/30/95, collateralized by
$7,744,000 U.S. Treasury Notes
6.625% due 3/31/97, market value
$7,968,696) . . . . . . . . . . . . . . . . 7,807,000 7,807,000
-------------
TOTAL REPURCHASE AGREEMENTS
(cost $23,299,000) . . . . . . . . . . . . . 23,299,000
-------------
TOTAL MARKET VALUE OF SECURITIES OWNED -
99.69% (cost $307,174,585) . . . . . . . . . 378,378,553
RECEIVABLES AND OTHER ASSETS
NET OF LIABILITIES - 0.31% . . . . . . . . . 1,165,961
-------------
NET ASSETS APPLICABLE TO 26,685,751 SHARES
($.50 par value) OUTSTANDING - 100.00% . . . $ 379,544,514
=============
NET ASSET VALUE - TREND FUND A CLASS
($318,932,305 / 22,443,507 shares) . . . . . $14.21
======
NET ASSET VALUE - TREND FUND B CLASS
($5,175,095 / 366,139 shares) . . . . . . . $14.13
======
NET ASSET VALUE - TREND FUND INSTITUTIONAL CLASS
($55,437,114 / 3,876,105 shares) . . . . . . $14.30
======
</TABLE>
-----------------
* Non-income producing securities for the year ended June 30, 1995.
<TABLE>
<S> <C>
COMPONENTS OF NET ASSETS AT JUNE 30, 1995
Common stock, $.50 par value, 100,000,000 shares
authorized to the Fund . . . . . . . . . . . $ 304,019,879
Accumulated undistributed income:
Net investment loss . . . . . . . . . . . . (6,865,026)
Net realized gain on investments . . . . . . 11,185,693
Net unrealized appreciation of investments . 71,203,968
-------------
Total net assets . . . . . . . . . . . . . . . $ 379,544,514
=============
</TABLE>
See accompanying notes
11
<PAGE> 14
DELAWARE GROUP TREND FUND, INC.
STATEMENT OF OPERATIONS
JUNE 30, 1995
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest . . . . . . . . . . . . . . . . . . . $1,652,710
Dividends . . . . . . . . . . . . . . . . . . 743,262 $ 2,395,972
----------
EXPENSES:
Management fees ($2,300,627) and
director's fees ($13,570) . . . . . . . . . 2,314,197
Dividend disbursing and transfer agent
fees and expenses . . . . . . . . . . . . . 796,214
Distribution expenses . . . . . . . . . . . . 687,071
Salaries . . . . . . . . . . . . . . . . . . . 83,163
Reports to shareholder . . . . . . . . . . . . 72,880
Federal and state registration fees . . . . . . 58,763
Taxes (other than income) . . . . . . . . . . 43,995
Custodian fees . . . . . . . . . . . . . . . . 27,613
Professional fees . . . . . . . . . . . . . . 25,692
Other . . . . . . . . . . . . . . . . . . . . 71,629 4,181,217
---------- -------------
NET INVESTMENT LOSS . . . . . . . . . . . . . (1,785,245)
-------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS:
Net realized gain from
security transactions . . . . . . . . . . . 15,008,174
Net unrealized appreciation of
investments during the period . . . . . . . 57,806,727
-------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS . . . . . . . . . . . . 72,814,901
-------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS . . . . . . . . . $ 71,029,656
=============
NET ASSET VALUE AND OFFERING PRICE
PER SHARE - TREND FUND A CLASS:
Net asset value per share (A) . . . . . . . . $14.21
Sale charges (5.75% of offering price, or 6.12% of amount
invested per share) (B) . . . . . . . . . . 0.87
------
Offering price . . . . . . . . . . . . . . . . $15.08
======
</TABLE>
-----------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) For purchase of $100,000 or more, see Purchasing Shares in the current
Prospectus.
See accompanying notes
DELAWARE GROUP TREND FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
6/30/95 6/30/94
<S> <C> <C>
OPERATIONS:
Net investment loss . . . . . . . . . . $ (1,785,245) $ (1,929,961)
Net realized gain from security
transactions . . . . . . . . . . . . . 15,008,174 29,784,193
Unrealized appreciation (depreciation)
during the period . . . . . . . . . . 57,806,727 (31,647,248)
------------ ------------
Net increase (decrease) in net assets
resulting from operations . . . . . . 71,029,656 (3,793,016)
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS
FROM NET REALIZED GAIN FROM
SECURITY TRANSACTIONS:
Trend Fund A Class . . . . . . . . . . . (16,739,040) (32,729,334)
Trend Fund B Class . . . . . . . . . . . -- --
Trend Fund Institutional Class . . . . . (1,144,886) (531,465)
------------ ------------
(17,883,926) (33,260,799)
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
Trend Fund A Class . . . . . . . . . . 131,559,559 168,064,594
Trend Fund B Class . . . . . . . . . . 4,740,239 --
Trend Fund Institutional Class . . . . 42,474,949 16,706,844
Net asset value of shares issued upon
reinvestment of dividends from net
realized gain from security transactions:
Trend Fund A Class . . . . . . . . . . 15,551,079 28,072,193
Trend Fund B Class . . . . . . . . . . -- --
Trend Fund Institutional Class . . . . 801,350 531,465
------------ ------------
195,127,176 213,375,096
------------ ------------
Cost of shares repurchased:
Trend Fund A Class . . . . . . . . . . (128,026,067) (126,721,837)
Trend Fund B Class . . . . . . . . . . (145,450) --
Trend Fund Institutional Class . . . . (8,019,913) (4,199,365)
------------ ------------
(136,191,430) (130,921,202)
------------ ------------
Increase in net assets derived
from capital share transactions . . . . 58,935,746 82,453,894
------------ ------------
NET INCREASE IN NET ASSETS . . . . . . . 112,081,476 45,400,079
------------ ------------
NET ASSETS:
Beginning of period . . . . . . . . . . 267,463,038 222,062,959
------------ ------------
End of period . . . . . . . . . . . . . $379,544,514 $267,463,038
============ ============
</TABLE>
See accompanying notes
12
<PAGE> 15
DELAWARE GROUP TREND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1995
Delaware Group Trend Fund, Inc. (the "Fund"), is registered as a diversified
open-end investment company under the Investment Company Act of 1940. The Fund
is organized as a Maryland corporation and offers three classes of shares.
1. SIGNIFICANT ACCOUNTING POLICIES
The following accounting policies are in accordance with generally accepted
accounting principles and are consistently followed by the Fund for financial
statement preparation:
SECURITY VALUATION - Securities listed on an exchange are valued at the last
quoted sales price as of 4:00 p.m. on the valuation date. Securities not traded
or securities not listed on an exchange are valued at the mean of the last
quoted bid and asked prices. Money market instruments having less than 60 days
to maturity are valued at amortized cost.
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 is required in the financial
statements.
REPURCHASE AGREEMENTS - The Fund may invest in a pooled cash account along with
other members of the Delaware Group Family of Funds. The aggregated 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 100% 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.
CLASS ACCOUNTING - Investment income, common expenses and gain(loss) 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.
OTHER - Expenses common to all Funds within the Delaware Group 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
an accrual basis. Original issue discounts are accreted to interest income over
the lives of the respective securities.
The Fund declared distributions from net realized gain from security
transactions in the amount of $0.55 per share payable on August 7, 1995, to
shareholders of record on July 28, 1995. The ex-dividend date was July 31,
1995.
2. INVESTMENT MANAGEMENT AND DISTRIBUTION AGREEMENTS
In accordance with the terms of the Investment Management Agreement, the Fund
pays Delaware Management Company, Inc. (DMC), the Investment Manager of the
Fund, an annual fee which is calculated daily at the rate of 0.75% of the
average daily net assets of the Fund, less fees paid to the independent
directors. At June 30, 1995, the Fund had a liability for Investment Management
fees and other expenses payable to DMC for $78,693.
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 A Class and 1.00% of the
average daily net assets of B Class. At June 30, 1995, the Fund had a
liability for distribution fees and other expenses payable to DDLP for $7,268.
For the year ended June 30, 1995, the Fund paid DDLP $160,235 for commissions
earned on sales of Trend Fund A Class shares.
The Fund has engaged Delaware Service Company, Inc., (DSC), an affiliate of
DMC, to serve as dividend disbursing and transfer agent for the Fund. For the
year ended June 30, 1995, the Fund has expensed $796,214 for these services. At
June 30, 1995, the Fund had a liability for such fees and other expenses
payable to DSC for $28,454.
Certain officers of the Investment Manager are officers, directors and/or
employees of the Fund. These officers, directors and employees are paid no
compensation by the Fund.
On April 3, 1995, Delaware Management Holdings, Inc., the indirect parent of
DMC, DDLP and DSC, through a merger transaction (the "Merger") became a
wholly-owned subsidiary of Lincoln National Corporation. Other than the
resulting change in ownership, the Merger will not materially change the manner
in which DMC, DDLP and DSC have heretofore conducted their relationship with
the Fund.
3. INVESTMENTS
During the year ended June 30, 1995, the Fund made purchases of $238,745,155
and sales of $177,836,190 of investment securities other than U.S. Government
securities and temporary cash investments.
At June 30, 1995, unrealized appreciation for federal income tax purposes
aggregated $70,753,748 of which $99,052,007 related to unrealized appreciation
of securities and $28,298,259 to unrealized depreciation of securities.
The realized gain for federal income tax purposes was $14,662,549 for the year
ended June 30, 1995.
4. CAPITAL STOCK
Transactions in capital shares were as follows:
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
6/30/95 6/30/94
<S> <C> <C>
Shares sold:
Trend Fund A Class . . . . . . . . . . . . . . 10,667,330 12,147,854
Trend Fund B Class . . . . . . . . . . . . . . 377,619 --
Trend Fund Institutional Class . . . . . . . . 3,363,517 1,202,810
Shares issued upon reinvestment of
dividends from net realized gain from
security transactions:
Trend Fund A Class . . . . . . . . . . . . . . 1,355,804 2,118,368
Trend Fund B Class . . . . . . . . . . . . . . -- --
Trend Fund Institutional Class . . . . . . . . 69,562 39,851
---------- ----------
15,833,832 15,508,883
---------- ----------
</TABLE>
13
<PAGE> 16
NOTE TO FINANCIAL STATEMENTS (CONTINUED)
4. CAPITAL STOCK (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
6/30/95 6/30/94
<S> <C> <C>
Shares repurchased:
Trend Fund A Class . . . . . . . . . . . . . . (10,385,998) (9,189,082)
Trend Fund B Class . . . . . . . . . . . . . . (11,480) --
Trend Fund Institutional Class . . . . . . . . (658,987) (300,580)
---------- ----------
(11,056,465) (9,489,662)
---------- ----------
Net increase . . . . . . . . . . . . . . . . . 4,777,367 6,019,221
========== ==========
</TABLE>
5. LINES OF CREDIT
The Fund has a committed line of credit for $5,000,000. No amount was
outstanding at June 30, 1995, or at any time during the last fiscal year.
6. FINANCIAL HIGHLIGHTS
Selected data for each share of the Fund outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
TREND FUND TREND FUND TREND FUND
A CLASS B CLASS INSTITUTIONAL CLASS
------------------------------------------------ -------- ---------------------------
PERIOD PERIOD
9/6/94* YEAR YEAR 11/23/92*
YEAR ENDED JUNE 30, TO ENDED ENDED TO
1995 1994 1993 1992 1991 6/30/95 6/30/95 6/30/94 6/30/93
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period . . $12.210 $13.980 $11.380 $ 8.920 $ 9.970 $12.110 $12.250 $13.990 $12.760
Income from investment operations:
Net investment loss** . . . . . . . . (0.074) (0.042) (0.004) (0.005) (0.020) (0.142) (0.044) (0.002) (0.035)
Net realized and unrealized gain
(loss) from security
transactions . . . . . . . . . . . . 2.864 0.212 3.754 2.625 (0.460) 2.162 2.884 0.202 1.615
------- ------- ------- ------- ------- ------- ------- ------- -------
Total from investment operations . . . 2.790 0.170 3.750 2.620 (0.480) 2.020 2.840 0.200 1.580
Less distributions:
Dividends from net investment
income . . . . . . . . . . . . . . . none none none none (0.050) none none none none
Distributions from net realized
gain on security transactions . . . (0.790) (1.940) (1.150) (0.160) (0.520) none (0.790) (1.940) (0.350)
------- ------- ------- ------- ------- ------- ------- ------- -------
Total distributions . . . . . . . . . (0.790) (1.940) (1.150) (0.160) (0.570) none (0.790) (1.940) (0.350)
------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of period . . . . . $14.210 $12.210 $13.980 $11.380 $ 8.920 $14.130 $14.300 $12.250 $13.990
======= ======= ======= ======= ======= ======= ======= ======= =======
Total return+ . . . . . . . . . . . . . . 24.40% 0.59% 35.24% 29.31% (4.82%) 16.68% 24.74% 0.83% 21.69%
Ratios/supplemental data:
Net assets, end of period
(000 omitted) . . . . . . . . . . . $318,933 $253,964 $219,826 $124,548 $78,631 $ 5,175 $55,437 $13,499 $ 2,237
Ratio of expenses to
average net assets . . . . . . . . . 1.36% 1.37% 1.33% 1.18% 1.29% 2.12% 1.12% 1.15% 1.21%
Ratio of net investment income
(loss) to average net assets . . . . (0.58%) (0.72%) (0.61%) (0.43%) (0.24%) (1.34%) (0.34%) (0.50%) (0.49%)
Portfolio turnover . . . . . . . . . . 64% 67% 75% 76% 67% 64% 64% 67% 75%
</TABLE>
-----------------
* Date of initial public offering. Ratios have been annualized and total
return has not been annualized for Trend Fund B Class. Ratios and total
return have been annualized for Trend Fund Institutional Class.
** 1995 per share information was based on the average shares outstanding
method.
+ Does not reflect any maximum sales charges that are or were in effect nor
the 1% limited contingent deferred sales charge that would apply in the
event of certain redemptions within 12 months of purchase for Trend Fund A
Class and does not include contingent deferred sales charge which varies
from 1%-4% depending upon the holding period for Trend Fund B Class.
14
<PAGE> 17
DELAWARE GROUP TREND FUND, INC.
REPORT OF INDEPENDENT AUDITORS
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS
DELAWARE GROUP TREND FUND, INC.
We have audited the accompanying statement of net assets of Delaware Group
Trend Fund, Inc. as of June 30, 1995, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of the
two years in the period then ended, and the financial highlights for each of
the five years in the period then ended. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of investments owned as of
June 30, 1995, by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Delaware Group Trend Fund, Inc. at June 30, 1995, the results of its operations
for the year then ended, the changes in its net assets for each of the two
years in the period then ended, and the financial highlights for each of the
five years in the period then ended, in conformity with generally accepted
accounting principles.
Ernst & Young LLP
Philadelphia, Pennsylvania
July 28, 1995
15
<PAGE> 18
A REPORT ON TREND FUND'S ANNUAL MEETING
At an annual meeting of shareholders held on March 29, 1995, the following
matters were submitted for shareholder vote: the election of directors, the
ratification of the selection of Ernst & Young LLP as independent auditors of
the Fund and the approval of a new investment management agreement. The new
investment management agreement was proposed in connection with the April 3,
1995 merger of Delaware Management Holdings, Inc. (the parent of Delaware
Management Company, Inc.) and a subsidiary of Lincoln National Corporation.
Whenever there is a change in control of an investment manager, the Investment
Company Act of 1940 requires shareholders to vote on a new investment
management agreement.
Below are the names of each director elected at the meeting as well as the
results of the other matters voted on by shareholders.
<TABLE>
<CAPTION>
NUMBER OF VOTES*
--------------------------------------------
FOR AGAINST/WITHHELD ABSTENTIONS
<S> <C> <C> <C>
Election of Directors:
Wayne A. Stork . . . . . . . . . 13,866,249 324,440 --
Walter P. Babich . . . . . . . . 13,867,111 323,578 --
Anthony D. Knerr . . . . . . . . 13,865,175 325,514 --
Ann R. Leven . . . . . . . . . . 13,866,377 324,312 --
W. Thacher Longstreth . . . . . . 13,860,539 330,151 --
Charles E. Peck . . . . . . . . . 13,866,289 324,400 --
Selection of Ernst & Young LLP as
Independent Auditors . . . . . . 13,593,453 135,687 461,549
Approval of the New
Investment Management
Agreement . . . . . . . . . . . . 13,330,700 297,232 562,758
</TABLE>
* Please note that the results of this meeting were not audited by Ernst &
Young LLP.
16
<PAGE> 19
This annual report is for the information of Trend Fund shareholders, but it
may be used with prospective investors when preceded or accompanied by a
current Prospectus, which gives details about charges, expenses, investment
objectives and operating policies of the Fund. Summary investment results are
documented in the current Statement of Additional Information. If used with
prospective investors after September 30, 1995, this report must be accompanied
by a Trend Fund Performance Update for the most recently completed calendar
quarter. The figures in this report represent past 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
-------------------------------------
MEMBERS
-------------------------------------
WAYNE A. STORK
Chairman, Delaware Group of Funds
Philadelphia, PA
WALTER P. BABICH
Board Chairman, Citadel Constructors, Inc.
King of Prussia, PA
ANTHONY D. KNERR
Consultant, Anthony Knerr & Associates
New York, NY
ANN R. LEVEN
Treasurer, National Gallery of Art
Washington, DC
W. THACHER LONGSTRETH
Vice Chairman, Packquisition Corp.
Philadelphia, PA
CHARLES E. PECK
Secretary of Enterprise Homes, Inc.
Fredericksburg, VA
former Chairman and CEO
The Ryland Group, Inc.
Columbia, MD
AFFILIATED
-------------------------------------
OFFICERS
-------------------------------------
BRIAN F. WRUBLE
President and CEO, Delaware Group of Funds
Philadelphia, PA
GEORGE M. CHAMBERLAIN, JR.
Senior Vice President and Secretary,
Delaware Group of Funds
Philadelphia, PA
KEITH E. MITCHELL
President and CEO, Delaware Distributors, L.P.
Philadelphia, PA
DAVID K. DOWNES
Senior Vice President, Chief Financial Officer and
Chief Administrative Officer
Delaware Group of Funds
Philadelphia, PA
<PAGE> 20
DELAWARE GROUP
-------------------------------------
OF FUNDS
-------------------------------------
FOR GROWTH OF CAPITAL
Trend Fund
DelCap Fund
Value Fund
FOR TOTAL RETURN
Devon Fund
Decatur Total Return Fund
Decatur Income Fund
Delaware Fund
FOR GLOBAL DIVERSIFICATION
International Equity Fund
Global Assets Fund
Global Bond Fund
FOR CURRENT INCOME
Delchester Fund
U.S. Government Fund
Limited-Term Government Fund
FOR TAX-FREE CURRENT INCOME
Tax-Free USA Fund
Tax-Free Insured Fund
Tax-Free USA Intermediate Fund
Tax-Free Pennsylvania Fund
MONEY MARKET FUNDS
Delaware Cash Reserve
U.S. Government Money Fund
Tax-Free Money Fund
CLOSED-END EQUITY/INCOME*
Dividend and Income Fund
Global Dividend and Income Fund
This report must be preceded or accompanied by a current Trend Fund prospectus.
For a prospectus of any other Delaware Group fund, contact your financial
adviser or Delaware Group.
* Delaware Group Dividend and Income Fund and Delaware Group Global Dividend
and Income Fund purchases can be made through any registered broker.
[DELAWARE GROUP LOGO APPEARS HERE]
Be sure to consult your financial adviser when making investments. Mutual funds
can be a valuable part of your financial plan; however, shares of the Fund are
not FDIC or NCUSIF insured, are not guaranteed by any bank or any credit union,
are not obligations of or deposits of any bank or any credit union, and involve
investment risk, including the possible loss of principal. Shares of the Fund
are not bank or credit union deposits.
INVESTMENT MANAGER
Delaware Management Company, Inc.
Philadelphia
INTERNATIONAL AFFILIATE
Delaware International Advisers Ltd.
London
NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
Philadelphia
SHAREHOLDER SERVICING,
DIVIDEND DISBURSING
AND TRANSFER AGENT
Delaware Service Company, Inc.
Philadelphia
1818 Market Street
Philadelphia, PA 19103-3682
Nationwide (800) 523-4640;
In Philadelphia (215) 988-1333
SECURITIES DEALERS ONLY
Nationwide (800) 362-7500;
In Philadelphia (215) 988-1050
(C) Delaware Distributors, L.P.
[RECYCLE SYMBOL] Printed in the U.S.A. on recycled paper.
AR-003[695]TKO895
