Dreyfus A Bonds Plus, Inc.
SEMIANNUAL REPORT September 30, 1999
(reg.tm)
The views expressed herein are current to the date of this report. These views
and the composition of the fund's portfolio are subject to change at any time
based on market and other conditions.
* Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value
Year 2000 Issues (Unaudited)
The fund could be adversely affected if the computer systems used by The Dreyfus
Corporation and the fund's other service providers do not properly process and
calculate date-related information from and after January 1, 2000. The Dreyfus
Corporation is working to avoid Year 2000-related problems in its systems and to
obtain assurances from other service providers that they are taking similar
steps. In addition, issuers of securities in which the fund invests may be
adversely affected by Year 2000-related problems. This could have an impact on
the value of the fund's investments and its share price.
Contents
THE FUND
- --------------------------------------------------
2 Letter from the President
3 Discussion of Fund Performance
6 Statement of Investments
12 Statement of Financial Futures
13 Statement of Assets and Liabilities
14 Statement of Operations
15 Statement of Changes in Net Assets
16 Financial Highlights
17 Notes to Financial Statements
FOR MORE INFORMATION
- ---------------------------------------------------------------------------
Back Cover
The Fund
Dreyfus
A Bonds Plus, Inc.
LETTER FROM THE PRESIDENT
Dear Shareholder:
We are pleased to present this semiannual report for Dreyfus A Bonds Plus, Inc.,
covering the six-month period from April 1, 1998 through September 30, 1999.
Inside, you' ll find valuable information about how the fund was managed during
the reporting period, including a discussion with Gerald Thunelius, portfolio
manager and a member of the Dreyfus Taxable Fixed Income Team that manages the
fund.
The past six months have been highly volatile for most bonds. When the reporting
period began, evidence had emerged that the U.S. economy was growing strongly in
an environment characterized by high levels of consumer spending and low levels
of unemployment. Concerns that inflationary pressures might re-emerge caused the
Federal Reserve Board to raise short-term interest rates twice during the summer
of 1999, effectively offsetting most of last fall' s interest-rate cuts
Higher interest rates led to some erosion of bond prices, especially among the
higher yielding market sectors. In this environment, however, the yields of many
higher yielding bonds -- including corporate bonds and U.S. government agency
securities -- have recently been quite attractive compared to the yields of U.S.
Treasury securities of comparable maturity.
We appreciate your confidence over the past year, and we look forward to your
continued participation in Dreyfus A Bonds Plus, Inc.
Sincerely,
Stephen E. Canter
President and Chief Investment Officer
The Dreyfus Corporation
October 15, 1999
DISCUSSION OF FUND PERFORMANCE
Gerald E. Thunelius, Portfolio Manager
Dreyfus Taxable Fixed Income Team
How did Dreyfus A Bonds Plus, Inc. perform relative to its benchmark?
For the six-month period ended September 30, 1999, Dreyfus A Bonds Plus, Inc.
produced a 0.22% total return.(1) This compares to a -0.22% total return
provided by the fund's benchmark, the Merrill Lynch Domestic Master Index,(2)
and a -0.21% total return for the Lehman Brothers Aggregate Bond Index(3) for
the same period.
We attribute the fund' s performance to our asset allocation strategy. We
increased the fund' s exposure to corporate bonds from economically sensitive
issuers, a sector of the bond market that has performed relatively well over the
past six months. At the same time, we decreased exposure to commercial
mortgage-backed securities in order to improve the liquidity of the fund's
holdings.
What is the fund's investment approach?
The fund seeks high current income from a portfolio that invests at least 80% of
its assets in fixed-income securities that, when purchased, are rated single-A
or better or are the unrated equivalent as determined by Dreyfus, and in
securities issued or guaranteed by the U.S. Government or its agencies or
instrumentalities. While the fund may invest in a broad array of fixed-income
securities, the fund has recently concentrated primarily on corporate
securities.
When selecting securities for the fund, we first examine U.S. and global
economic conditions and other market factors to determine what we believe is the
likely direction of long- and short-term interest rates. Using a research-driven
investment process, we then attempt to identify potentially profitable sectors
before they are widely perceived by the market. Finally, we look for underpriced
or mispriced The Fund
DISCUSSION OF FUND PERFORMANCE (CONTINUED)
securities within those sectors that, in our opinion, appear likely to perform
well over time.
What other factors influenced the fund's performance?
At the beginning of the fund's six-month reporting period, many global economies
appeared to be recovering from last fall's currency and credit crisis. Commodity
prices, particularly oil prices, began to climb from levels that we considered
substantially undervalued. At the same time, investors seemed to become more
comfortable holding a broader array of assets. This recovery helped boost
returns from some of our corporate bond holdings, especially those from
economically sensitive issuers such as oil, chemical and paper companies. Prices
of U.S. Treasury securities, however, fell sharply in the face of higher
interest rates and concerns that robust economic growth might re-ignite
inflationary pressures.
Largely because of inflation concerns, the Federal Reserve Board raised
short-term interest rates twice during the summer of 1999. An additional
interest-rate hike was expected in November, which would effectively offset all
of last fall's rate cuts. Overall, higher interest rates adversely affected the
securities in which the fund invests. By August, in fact, the differences in
yields between U.S. Treasury securities and corporate bonds had widened to
levels last seen during 1998' s global financial crisis.
What is the fund's current strategy?
During the six-month period, we emphasized the corporate bond market and
de-emphasized our exposure to mortgage-related securities, particularly
commercial mortgage-backed securities. This shift enabled us to focus on
maintaining certain levels of liquidity in a rising interest-rate environment,
and the strategy proved beneficial for the fund.
The fund' s strongest fixed-income gains were produced by the corporate bond
sector. Especially attractive returns were produced by bonds from cyclical
issuers -- especially oil, paper, and chemical companies -- that we added to the
portfolio in the beginning of the year, before oil prices rose. Our holdings in
the telecommunications sector also provided relatively attractive returns.
Most recently, we have decreased our exposure to industrial and economically
sensitive companies within the corporate bond sector, choosing instead to shift
those assets to the financial services sector. We believe that the financial
sector is likely to benefit from the more stable interest-rate environment that
we expect to prevail once the Federal Reserve Board's interest-rate hikes are
complete.
October 15, 1999
(1) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. SHARE PRICE, YIELD AND
INVESTMENT RETURN FLUCTUATE SUCH THAT UPON REDEMPTION FUND SHARES MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
(2) SOURCE: BLOOMBERG L.P. -- THE MERRILL LYNCH DOMESTIC MASTER INDEX IS AN
UNMANAGED PERFORMANCE BENCHMARK COMPOSED OF U.S. TREASURY AND AGENCY SECURITIES,
AND MORTGAGE AND INVESTMENT GRADE CORPORATE SECURITIES WITH MATURITIES GREATER
THAN OR EQUAL TO ONE YEAR.
(3) SOURCE: LIPPER ANALYTICAL SERVICES, INC. -- THE LEHMAN BROTHERS AGGREGATE
BOND INDEX IS AN UNMANAGED INDEX OF CORPORATE, GOVERNMENT AND GOVERNMENT AGENCY
DEBT INSTRUMENTS, MORTGAGE-BACKED SECURITIES AND ASSET-BACKED SECURITIES WITH AN
AVERAGE MATURITY OF 1-10 YEARS.
The Fund
STATEMENT OF INVESTMENTS
September 30, 1999 (Unaudited)
<TABLE>
<CAPTION>
Principal
BONDS AND NOTES--98.0% Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
AEROSPACE & DEFENSE--1.0%
Lockheed Martin,
<S> <C> <C>
Notes, 7.7%, 2008 5,000,000 5,021,230
AIRLINES--2.7%
Continental Airlines,
Pass-Through Ctfs.,
Ser. 1997-4A, 6.9%, 2018 14,000,000 13,346,550
ASSET-BACKED--1.6%
Bombardier Capital Mortgage Securitization,
Sr. Sub. Pass-Through Ctfs.,
Ser. 1999-B, Cl. A3, 7.18%, 2015 5,000,000 5,005,469
Bosque Asset,
Asset-Backed Notes,
7.66%, 2002 2,669,837 (a) 2,669,420
7,674,889
AUTOMOTIVE--5.0%
Daimler-Chrysler:
Deb., 7.45%, 2027 3,000,000 2,993,790
Deb., 7.4%, 2097 5,000,000 4,755,115
Ser. B, Notes, 7.45%, 2097 5,000,000 4,786,140
Federal-Mogul,
Notes, 7.875%, 2010 5,000,000 4,562,895
Lear,
Sr. Notes, 7.96%, 2005 7,500,000 (a) 7,363,425
24,461,365
BANKING--3.6%
Dresdner Funding Trust I,
Notes, 8.151%, 2031 5,000,000 (a) 4,703,530
KeyCorp Capital III,
Capital Securities, 7.75%, 2029 5,000,000 4,696,075
National Westminster Bank,
Sub. Notes, 7.375%, 2009 8,100,000 8,068,831
17,468,436
BROADCASTING & MEDIA--4.3%
British Sky Broadcasting Group,
Notes, 6.875%, 2009 7,000,000 (a) 6,352,129
Chancellor Media (AMFM):
Sr. Notes, 8%, 2008 2,000,000 1,957,500
Sr. Notes, 9%, 2008 3,500,000 3,561,250
Charter Communications,
Sr. Discount Notes, 0/9.92%, 2011 15,000,000 (a),(b) 9,018,750
20,889,629
Principal
BONDS AND NOTES (CONTINUED) Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
CHEMICALS--5.8%
Air Products & Chemicals, Ser. E,
Medium-Term Notes, 7.8%, 2026 3,637,000 3,639,469
Great Lakes Chemical,
Notes, 7%, 2009 10,000,000 9,799,080
ICI Wilmington
(Gtd. by Imperial Chemical Industries):
Notes, 6.95%, 2004 7,000,000 6,903,743
Notes, 7.05%, 2007 8,105,000 7,867,904
28,210,196
COMMERCIAL MORTGAGE PASS-THROUGH CTFS.--6.4%
GMAC Commercial Mortgage Securities,
Ser. 1996-C1, Cl. E, 7.86%, 2006 3,105,000 2,969,156
GS Mortgage Securities II,
Ser. 1998-C1, Cl. D, 7.24%, 2030 6,000,000 (c) 5,490,240
Nomura Asset Securities,
Ser. 1998-D6, Cl. A3, 6.98%, 2028 9,000,000 (c) 8,326,406
Nomura Depositor Trust ST 1,
Ser. 1998-ST1, Cl. A3, 5.96%, 2003 5,000,000 (a),(c) 4,878,125
Resolution Trust,
Ser. 1994-C2, Cl. D, 8%, 2025 9,792,056 9,799,449
31,463,376
COMPUTERS--1.9%
IBM,
Deb., 7.125%, 2096 10,000,000 9,430,680
CONSUMER--3.2%
Corning,
Deb., 6.85%, 2029 17,090,000 15,586,405
ELECTRIC POWER--2.4%
Edison International,
Notes, 6.875%, 2004 5,000,000 4,944,030
Electric Lightwave,
Notes, 6.05%, 2004 7,000,000 (a) 6,775,650
11,719,680
ENERGY--4.3%
Enron Oil & Gas Resources,
Notes, 6.65%, 2028 10,000,000 8,748,330
Phillips Petroleum,
Deb., 7%, 2029 13,500,000 12,460,500
21,208,830
The Fund
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
Principal
BONDS AND NOTES (CONTINUED) Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
FINANCE--1.6%
Sumitomo Bank International Finance,
Notes, 8.5%, 2009 7,500,000 7,727,677
FOREIGN--1.4%
Korea Electric Power,
Deb., 7.75%, 2013 7,500,000 6,706,230
FOREIGN/GOVERNMENTAL--1.1%
Province of Quebec, Ser. PD,
Deb., 7.5%, 2029 5,500,000 5,520,570
INDUSTRIAL--5.2%
PPG Industries,
Notes, 7.05%, 2009 8,500,000 8,473,956
Rockwell International:
Deb., 6.7%, 2028 12,000,000 11,003,640
Deb., 5.2%, 2098 5,000,000 3,292,275
USA Waste Services,
Sr. Notes, 7.125%, 2017 3,500,000 2,898,633
25,668,504
INSURANCE--2.2%
Frank Russell,
Notes, 5.625%, 2009 12,000,000 (a) 10,793,268
OIL--3.0%
Amerada Hess,
Notes, 7.875%, 2029 15,000,000 14,854,950
OIL SERVICES--3.1%
Dresser Industries,
Deb., 7.6%, 2096 10,000,000 9,985,440
Transocean Offshore Rig,
Deb., 8%, 2027 5,000,000 5,169,100
15,154,540
PAPER & PAPER RELATED--3.1%
Boise Cascade:
Deb., 9.85%, 2002 8,723,000 9,214,977
Ser. A, Medium-Term Notes, 7.92%, 2007 6,000,000 5,902,278
15,117,255
REAL ESTATE INVESTMENT TRUST--.5%
Crescent Real Estate Equities,
Notes, 7%, 2002 2,500,000 2,354,967
RESIDENTIAL MORTGAGE PASS-THROUGH CTFS.--3.0%
Chase Mortgage Finance, REMIC:
Ser. 1998-S5, Cl. B3, 6.5%, 2013 602,332 (a) 473,960
Ser. 1998-S5, Cl. B4, 6.5%, 2013 501,943 (a) 334,106
Principal
BONDS AND NOTES (CONTINUED) Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
RESIDENTIAL MORTGAGE PASS-THROUGH CTFS. (CONTINUED)
GE Capital Mortgage Services,
REMIC, Ser. 1998-16, Cl. B3, 6.5%, 2013 1,077,171 (a) 846,926
Norwest Asset Securities:
Ser. 1997-15, Cl. B1, 6.75%, 2012 1,016,185 985,176
Ser. 1997-16, Cl. B1, 6.75%, 2027 2,158,088 1,991,355
Ser. 1997-16, Cl. B2, 6.75%, 2027 687,021 598,993
Ser. 1998-11, Cl. B2, 6.5%, 2013 1,697,928 1,587,512
Ser. 1998-13, Cl. B1, 6.25%, 2028 2,960,157 2,633,755
Ser. 1998-13, Cl. B2, 6.25%, 2028 2,836,941 2,644,511
Ser. 1998-13, Cl. B6, 6.25%, 2028 370,991 (a) 78,706
Residential Funding Mortgage Securities I:
Ser. 1998-S9, Cl. 1-B1, 6.5%, 2013 779,949 (a) 634,668
Ser. 1998-S22, Cl. B1, 6.5%, 2013 491,923 385,852
Ser. 1998-S22, Cl. B3, 6.5%, 2013 369,036 (a) 88,569
Ser. 1998-S22, Cl. M2, 6.5%, 2013 615,144 557,443
Ser. 1998-S22, Cl. M3, 6.5%, 2013 1,229,807 1,066,870
14,908,402
RETAIL--.9%
Saks,
Notes, 8.25%, 2008 4,500,000 4,381,943
TECHNOLOGY--2.1%
United Technologies:
Notes, 7%, 2006 6,200,000 6,246,643
Notes, 7.5%, 2029 4,000,000 4,043,896
10,290,539
WIRELESS COMMUNICATIONS--1.4%
Centaur Funding, Ser. C,
Discount Notes, 0%, 2020 45,000,000 (a) 6,604,740
U.S. GOVERNMENT--11.6%
U.S. Treasury Bonds:
5.25%, 2/15/2029 18,265,000 15,974,934
6.125%, 8/15/2029 11,375,000 11,491,252
U.S. Treasury Inflation Protection Securities,
3.875%, 1/15/2009 5,000,000 (d) 4,923,400
U.S. Treasury Notes:
6%, 8/15/2004 4,060,000 4,098,814
6%, 8/15/2009 20,000,000 20,161,200
56,649,600
The Fund
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
Principal
BONDS AND NOTES (CONTINUED) Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY/MORTGAGE BACKED--15.6%
Federal Home Loan Mortgage,
REMIC, Mutliclass Mortgage Participation Ctfs.
(Interest Only Obligation):
Ser. 1978, Cl. PH, 7%, 1/15/2024 4,665,412 (e) 626,915
Ser. 1995, Cl. PY, 7%, 10/15/2027 10,124,292 (e) 3,769,717
Federal National Mortgage Association:
6.88%, 2/1/2028 4,234,962 4,165,788
Remic Trust, Gtd. Pass Through Ctfs.,
Ser. 1996-64, Cl. PM, 7%, 1/18/2012
(Interest Only Obligation) 6,434,604 (e) 1,097,679
Government National Mortgage Association I:
6.475%, 9/1/2033 7,747,701 7,515,270
7%, 6/15/2008 86,295 86,808
9.5%, 11/15/2017 4,134,342 4,488,325
Construction Loan:
6.7%, 7/15/2001 11,576,069 11,319,196
6.7%, 5/15/2039 3,789,730 (f) 3,705,636
6.86%, 3/15/2038 12,979,300 (f) 13,088,715
7%, 3/15/2000 10,625,874 10,715,450
7%, 7/15/2039 1,172,826 (f) 1,182,713
Project Loan:
6.54%, 7/15/2033 4,418,760 4,305,507
6.55%, 6/15/2033 1,835,053 1,770,239
6.625%, 6/1/2033-9/15/2033 6,189,159 6,063,724
6.75%, 10/15/2033 2,217,796 2,172,730
76,074,412
TOTAL BONDS AND NOTES
(cost $492,487,704) 479,288,863
Principal
SHORT-TERM INVESTMENTS--.8% Amount ($) Value ($)
- ------------------------------------------------------------------------------------------------------------------------------------
U.S. TREASURY BILLS:
4.42%, 10/14/1999 1,500,000 (g) 1,497,570
4.48%, 11/12/1999 500,000 (g) 497,390
4.7%, 11/26/1999 600,000 (g) 595,758
4.57%, 12/9/1999 1,200,000 (g) 1,189,416
TOTAL SHORT-TERM INVESTMENTS
(cost $3,780,095) 3,780,134
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (cost $496,267,799) 98.8% 483,068,997
CASH AND RECEIVABLES (NET) 1.2% 5,897,451
NET ASSETS 100.0% 488,966,448
</TABLE>
(A) SECURITIES EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT
OF 1933. THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM
REGISTRATION, NORMALLY TO QUALIFIED BUYERS. AT SEPTEMBER 30, 1999, THESE
SECURITIES AMOUNTED TO $61,615,972 OR 12.6% OF NET ASSETS.
(B) ZERO COUPON UNTIL A SPECIFIED DATE AT WHICH TIME THE STATED COUPON RATE
BECOMES EFFECTIVE UNTIL MATURITY.
(C) VARIABLE RATE SECURITY--INTEREST RATE SUBJECT TO PERIODIC CHANGE.
(D) VARIABLE RATE SECURITY--BASE INTEREST RATE SHOWN--ADJUSTMENT TO INTEREST
RATE LINKED TO THE CONSUMER PRICE INDEX.
(E) NOTIONAL FACE AMOUNT SHOWN.
(F) PURCHASED ON A FORWARD COMMITMENT BASIS.
(G) HELD BY THE CUSTODIAN IN A SEGREGATED ACCOUNT AS COLLATERAL FOR OPEN
FINANCIAL FUTURES POSITIONS.
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
STATEMENT OF FINANCIAL FUTURES
September 30, 1999 (Unaudited)
<TABLE>
<CAPTION>
Market Value Unrealized
Covered (Depreciation)
Contracts by Contracts ($) Expiration at 9/30/99 ($)
- ------------------------------------------------------------------------------------------------------------------------------------
FINANCIAL FUTURES SHORT
<S> <C> <C> <C> <C>
U.S. Treasury 5 year Notes 782 84,822,563 December '99 (30,469)
U.S. Treasury 20 year Bonds 724 82,490,750 December '99 (124,781)
(155,250)
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
STATEMENT OF ASSETS AND LIABILITIES
September 30, 1999 (Unaudited)
Cost Value
- --------------------------------------------------------------------------------
ASSETS ($):
Investments in securities--See Statement of
Investments 496,267,799 483,068,997
Cash 4,814,012
Receivable for investment securities sold 20,857,868
Interest receivable 6,716,389
Paydown receivables 27,992
Receivable for shares of Common Stock subscribed 26,356
Prepaid expenses and other assets 14,759
515,526,373
- --------------------------------------------------------------------------------
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 312,276
Payable for investment securities purchased 24,347,322
Payable for futures variation margin--Note 4(a) 885,055
Payable for shares of Common Stock redeemed 811,955
Accrued expenses 203,317
26,559,925
- --------------------------------------------------------------------------------
NET ASSETS ($) 488,966,448
- --------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS ($):
Paid-in capital 515,724,252
Accumulated undistributed investment income--net 4,723,755
Accumulated net realized gain (loss) on investments (18,127,507)
Accumulated net unrealized appreciation (depreciation) on investments
[including ($155,250) net unrealized (depreciation)
on financial futures]--Note 4(b) (13,354,052)
- --------------------------------------------------------------------------------
NET ASSETS ($) 488,966,448
- --------------------------------------------------------------------------------
SHARES OUTSTANDING
(100 million shares of $.01 par value Common Stock authorized) 35,990,297
NET ASSET VALUE, offering and redemption price per share ($) 13.59
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
STATEMENT OF OPERATIONS
Six Months Ended September 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
INVESTMENT INCOME ($):
INCOME:
Interest 18,583,321
Cash dividends 49,954
TOTAL INCOME 18,633,275
EXPENSES:
Management fee--Note 3(a) 1,718,885
Shareholder servicing costs--Note 3(b) 754,648
Professional fees 42,903
Custodian fees--Note 3(b) 39,181
Directors' fees and expenses--Note 3(c) 23,962
Prospectus and shareholders' reports 18,948
Registration fees 15,837
Miscellaneous 4,103
TOTAL EXPENSES 2,618,467
INVESTMENT INCOME--NET 16,014,808
- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):
Net realized gain (loss) on investments and options transactions
(10,101,322)
Net realized gain (loss) on financial futures 6,761,897
NET REALIZED GAIN (LOSS) (3,339,425)
Net unrealized appreciation (depreciation) on investments
[including ($443,695) net unrealized (depreciation) on
financial futures] (12,339,779)
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS (15,679,204)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 335,604
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
September 30, 1999 Year Ended
(Unaudited) March 31, 1999
- --------------------------------------------------------------------------------
OPERATIONS ($):
Investment income--net 16,014,808 35,287,779
Net realized gain (loss) on investments (3,339,425) (14,456,795)
Net unrealized appreciation (depreciation)
on investments (12,339,779) (8,867,246)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 335,604 11,963,738
- --------------------------------------------------------------------------------
NET EQUALIZATION CREDITS (DEBITS)--NOTE 1(E) (682,659) (551,071)
- --------------------------------------------------------------------------------
DIVIDENDS TO SHAREHOLDERS FROM ($):
Investment income--net (16,517,043) (35,493,065)
Net realized gain on investments -- (8,881,327)
TOTAL DIVIDENDS (16,517,043) (44,374,392)
- --------------------------------------------------------------------------------
CAPITAL STOCK TRANSACTIONS ($):
Net proceeds from shares sold 50,279,832 240,655,499
Dividends reinvested 14,618,340 39,428,193
Cost of shares redeemed (135,566,404) (318,995,045)
INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL STOCK TRANSACTIONS (70,668,232) (38,911,353)
TOTAL INCREASE (DECREASE) IN NET ASSETS (87,532,330) (71,873,078)
- --------------------------------------------------------------------------------
NET ASSETS ($):
Beginning of Period 576,498,778 648,371,856
END OF PERIOD 488,966,448 576,498,778
Undistributed investment income--net 4,723,755 5,908,649
- --------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS (SHARES):
Shares sold 3,696,397 16,733,399
Shares issued for dividends reinvested 1,074,802 2,761,789
Shares redeemed (9,994,994) (22,239,479)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING (5,223,795) (2,744,291)
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
FINANCIAL HIGHLIGHTS
The following table describes the performance for the fiscal periods indicated.
Total return shows how much your investment in the fund would have increased (or
decreased) during each period, assuming you had reinvested all dividends and
distributions. These figures have been derived from the fund's financial
statements.
<TABLE>
<CAPTION>
Six Months Ended
September 30, 1999 Year Ended March 31,
-------------------------------------------------------------
(Unaudited) 1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA ($):
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period 13.99 14.75 14.13 14.47 13.75 14.38
Investment Operations:
Investment income--net .41 .83 .89 .88 .92 .94
Net realized and unrealized
gain (loss) on investments (.38) (.54) .79 (.34) .73 (.56)
Total from Investment Operations .03 .29 1.68 .54 1.65 .38
Distributions:
Dividends from investment
income--net (.43) (.84) (.89) (.88) (.93) (.94)
Dividends from net realized
gain on investments -- (.21) (.17) -- -- (.07)
Total Distributions (.43) (1.05) (1.06) (.88) (.93) (1.01)
Net asset value, end of period 13.59 13.99 14.75 14.13 14.47 13.75
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) .44(a) 2.05 12.20 3.88 12.12 3.01
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to average
net assets .99(a) .96 .95 .96 .93 .99
Ratio of net investment income
to average net assets 6.04(a) 5.78 6.07 6.12 6.32 6.89
Portfolio Turnover Rate 298.03(b) 255.27 374.30 415.69 165.50 172.60
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ x 1,000) 488,966 576,499 648,372 571,580 598,551 539,140
</TABLE>
(A) ANNUALIZED.
(B) NOT ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Significant Accounting Policies:
Dreyfus A Bonds Plus, Inc. (the "fund") is registered under the Investment
Company Act of 1940, as amended (the "Act" ), as a diversified open-end
management investment company. The fund's investment objective is to maximize
current income to the extent consistent with the preservation of capital and the
maintenance of liquidity. The Dreyfus Corporation (the "Manager") serves as the
fund' s investment adviser. The Manager is a direct subsidiary of Mellon Bank,
N.A. (" Mellon" ). Premier Mutual Fund Services, Inc. is the distributor of the
fund's shares, which are sold to the public without a sales charge.
The fund' s financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
(a) Portfolio valuation: Investments in securities (excluding short-term
investments, other than U.S. Treasury Bills, and financial futures) are valued
each business day by an independent pricing service ("Service") approved by the
Board of Directors. Investments for which quoted bid prices are readily
available and are representative of the bid side of the market in the judgment
of the Service are valued at the mean between the quoted bid prices (as obtained
by the Service from dealers in such securities) and asked prices (as calculated
by the Service based upon its evaluation of the market for such securities).
Other investments (which constitute a majority of the portfolio securities) are
carried at fair value as determined by the Service, based on methods which
include consideration of: yields or prices of securities of comparable quality,
coupon, maturity and type; indications as to values from dealers; and general
market conditions. Financial futures contracts and options thereon, which are
traded on exchanges, are valued at their closing prices as of the close of such
exchanges. Short-term investments, excluding U.S. Treasury Bills, are carried at
amortized cost, which approximates value.
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
(b) Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Dividend income is
recognized on the ex-dividend date and interest income, including, where
applicable, amortization of discount on investments, is recognized on the
accrual basis. Under the terms of the custody agreement, the fund receives net
earnings credits based on available cash balances left on deposit.
(c) Dividends to shareholders: Dividends are recorded on the ex- dividend date.
Dividends from investment income-net are declared and paid monthly. Dividends
from net realized capital gain, if any, are normally declared and paid annually,
but the fund may make distributions on a more frequent basis to comply with the
distribution requirements of the Internal Revenue Code of 1986, as amended (the
" Code" ). To the extent that net realized capital gain can be offset by capital
loss carryovers, it is the policy of the fund not to distribute such gain.
On September 30, 1999, the Board of Directors declared a cash dividend of $.070
per share from undistributed investment income-net, payable on October 1, 1999
(ex-dividend date) , to shareholders of record as of the close of business on
September 30, 1999.
(d) Federal income taxes: It is the policy of the fund to continue to qualify as
a regulated investment company, if such qualification is in the best interests
of its shareholders, by complying with the applicable provisions of the Code and
to make distributions of taxable income sufficient to relieve it from
substantially all Federal income and excise taxes.
The fund has an unused capital loss carrryover of approximately $3,436,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to March 31, 1999. This amount
is calculated based on Federal income tax regulations which may differ from
financial reporting in accordance with generally accepted accounting principles.
If not applied, the carryover expires in fiscal 2007.
(e) Equalization: The fund follows the accounting practice known as
" equalization" by which a portion of the amounts received on issuances and the
amounts paid on redemptions of fund shares (equivalent, on a per share basis, to
the amount of distributable investment income--net on the date of the
transaction) is allocated to undistributed investment income-net so that
undistributed investment income-net per share is unaffected by fund shares
issued or redeemed.
NOTE 2--Bank Line of Credit:
The fund may borrow up to $20 million for leveraging purposes under a short-term
unsecured line of credit and participates with other Dreyfus-managed funds in a
$100 million unsecured line of credit primarily to be utilized for temporary or
emergency purposes, including the financing of redemptions. Interest is charged
to the fund at rates which are related to the Federal Funds rate in effect at
the time of borrowings. During the period ended September 30, 1999, the fund did
not borrow under either line of credit.
NOTE 3--Management Fee and Other Transactions With Affiliates:
(a) Pursuant to a management agreement ("Agreement") with the Manager, the
management fee is computed at the annual rate of .65 of 1% of the value of the
fund' s average daily net assets and is payable monthly. The Agreement provides
that if in any full fiscal year the aggregate expenses of the fund, exclusive of
taxes, interest on borrowings, brokerage commissions and extraordinary expenses,
exceed 1 1/2% of the value of the fund's average net assets, the fund may deduct
from the payments to be made to the Manager, or the Manager will bear, the
amount of such excess expenses. During the period ended September 30, 1999,
there was no expense reimbursement pursuant to the Agreement.
(b) Under the Shareholder Services Plan, the fund reimburses Dreyfus Service
Corporation, a wholly-owned subsidiary of the Manager, an The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
amount not to exceed an annual rate of .25 of 1% of the value of the fund's
average daily net assets for certain allocated expenses of providing personal
services and/or maintaining shareholder accounts. The services provided may
include personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the fund and providing reports and other
information, and services related to the maintenance of shareholder accounts.
During the period ended September 30, 1999, the fund was charged $336,588
pursuant to the Shareholder Services Plan.
The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the fund. During the period
ended September 30, 1999, the fund was charged $110,417 pursuant to the transfer
agency agreement.
The fund compensates Mellon under a custody agreement for providing custodial
services for the fund. During the period ended September 30, 1999, the fund was
charged $39,181 pursuant to the custody agreement.
(c) Each director who is not an "affiliated person" as defined in the Act
receives from the fund an annual fee of $2,500 and an attendance fee of $500 per
meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 4--Securities Transactions:
(a) The aggregate amount of purchases and sales (including paydowns) of
investment securities, excluding short-term securities, options and financial
futures, during the period ended September 30, 1999, amounted to $1,588,977,268
and $1,678,643,210, respectively.
The fund may invest in financial futures contracts and options on such futures
contracts in order to gain exposure to or protect against changes in the market.
The fund is exposed to market risk as a result of changes in the value of the
underlying financial instruments. Investments in financial futures require the
fund to "mark to market" on a daily basis,
which reflects the change in the market value of the contracts at the close of
each day's trading. Typically, variation margin payments are received or made to
reflect daily unrealized gains or losses. When the contracts are closed, the
fund recognizes a realized gain or loss. These investments require initial
margin deposits with a custodian, which consist of cash or cash equivalents, up
to approximately 10% of the contract amount. The amount of these deposits is
determined by the exchange or Board of Trade on which the contract is traded and
is subject to change. Contracts open at September 30, 1999, are set forth in the
Statement of Financial Futures.
The fund may purchase or sell financial futures contracts and options on such
futures contracts for the purpose of hedging the market risk on existing
securities or the intended purchase of securities.
(b) At September 30, 1999, accumulated net unrealized depreciation on
investments and financial futures was $13,354,052, consisting of $1,112,205
gross unrealized appreciation and $14,466,257 gross unrealized depreciation.
At September 30, 1999, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
The Fund
For More Information
Dreyfus A Bonds Plus, Inc.
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, PA 15258
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Distributor
Premier Mutual Fund Services, Inc.
60 State Street
Boston, MA 02109
To obtain information:
BY TELEPHONE Call 1-800-645-6561
BY MAIL Write to: The Dreyfus Family of Funds 144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
BY E-MAIL Send your request to [email protected]
ON THE INTERNET Information can be viewed online or downloaded from:
http://www.dreyfus.com
(c) 1999 Dreyfus Service Corporation 084SA999
