LETTER TO SHAREHOLDERS
Dear Shareholder:
Anticipating improved securities prices, Dreyfus Capital Growth Fund (A
Premier Fund) made some significant changes in portfolio weightings in the
last few months.
Our investment strategy during this period was to reduce holdings in
Basic Industries and Capital Goods categories, which are mainly of a cyclical
nature, and to increase investments in consumer-oriented stocks, in Energy,
Financial stocks, the Transportation industry, Technology and Utilities.
The decision to lighten holdings in cyclical securities was based on the
expectation that the expansion of the U.S. economy would slow down,
responding to the tighter credit policies of the Federal Reserve Board.
Indeed, this is what did occur. Among issues we sold in this category were
Foster Wheeler, International Paper, OM Group, Stone Container, CBI
Industries and Illinois Tool Works. As of March 31, the portfolio had 6.1% in
Basic Industries stocks and 4.6% in Capital Goods, which compares with 6.6%
and 5.3% respectively six months earlier.
During the same period we added Consumer Cyclicals such as American
Standard, Chrysler, Federated Department Stores, General Motors, MASCO and
Sears, Roebuck. In the Consumer Staples category, new positions were
established in Bard (C.R.) and Circle K. These acquisitions brought the
Consumer Cyclical group to 9.9% of the portfolio, compared to .6% six months
earlier, and Consumer Staples to 19.2% vs 18.6% as of last September 30.
The percentage allocations to Energy and the Financial industry were
modestly increased. The Transportation industry was given a heavier weighting
(2.1% vs. .4% six months ago) with the acquisition of Alaska Air Group and
Delta Air Lines.
As we mentioned in our annual report last Fall, we had begun to buy
Utilities at prices that appeared to be depressed. This purchase program has
been continued so that Utilities now account for 11.8% of the portfolio vs.
3.7% six months ago. We have also increased the commitment to the Technology
area from .2% of the portfolio to 3.7%. The new acquisitions in this industry
group include British Sky Broadcasting Group, ADS, Comsat, SGS-Thomson N.V.
and Unisys.
The foreign stocks component is slightly higher, but its makeup has been
changed to eliminate a number of Japanese stocks and strengthen the stake in
Western Europe.
The result of these portfolio changes was a positive total return for the
half year of 5.89%, based on net asset value per share.* This was somewhat
less than returns for the Standard & Poor's 500 Index and the Dow Jones
Industrial Average, which were 9.71% and 9.73%, respectively, for the same
period.** One reason for the underperformance is that the Fund's less
defensive posture was not in effect for the entire six months under review.
We are pleased that you are a shareholder in Dreyfus Capital Growth Fund.
We look forward to serving your future investment needs.
Sincerely,
(Howard Stein Signature Logo)
Howard Stein
Chairman and Chief Executive Officer
The Dreyfus Corporation
April 12, 1995
New York, N.Y.
*Total return represents the change during the period in a hypothetical
account with dividends reinvested.
** SOURCE: LIPPER ANALYTICAL SERVICES, INC. - Reflects the
reinvestment of income dividends and, where applicable, capital gain
distributions. Unlike the Fund, which may invest in a wide range of
securities, both the Dow Jones Industrial Average and the Standard &
Poor's 500 Composite Stock Price Index are widely accepted unmanaged
indexes of domestic stock market performance.
<TABLE>
<CAPTION>
DREYFUS CAPITAL GROWTH FUND (A Premier Fund) MARCH 31, 1995
ASSET ALLOCATION
(EXHIBIT A)
FIVE LARGEST SECTORS
<S> <C> <C>
Consumer Staples................................................ 19.7%
Utilities....................................................... 11.8
Consumer Cyclical............................................... 9.9
Foreign......................................................... 8.2
Energy.......................................................... 6.6
TEN LARGEST EQUITY HOLDINGS
Philip Morris Cos............................................. 4.5 %
General Motors................................................ 4.2
Merck & Co.................................................... 2.9
Veba.......................................................... 2.6
American Home Products........................................ 2.4
Dow Chemical.................................................. 2.2
Baker Hughes.................................................. 2.1
American Standard............................................. 1.8
Roche Holding................................................. 1.8
AT&T.......................................................... 1.8
</TABLE>
All percentages shown above are based on Total Net Assets.
Portfolio composition is subject to change.
Preferred Stocks (.5%)
Cash Equivalents (22.9%)
Common Stocks (76.6%)
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
COMMON STOCK PURCHASES AND SALES
SIX MONTHS ENDED MARCH 31, 1995 (UNAUDITED) PURCHASES*
New Commitments:
AT&T, Alaska Air Group, American Standard, Banque Privee Edmond de
Rothschild, Bard (C.R.), British Sky Broadcasting Group, ADS, Chrysler,
CINergy, Circle K, Comsat, Delta Air Lines, Entergy, Federated Department
Stores, Fisons, General Motors, Hemlo Gold Mines, Iino Kaiun, Ladbroke,
Lonrho, MGIC Investment, Masco, McKesson, National Health Labs Holdings,
Nippon Yusen Kabushiki Kaisha, Nipsco Industries, PECO Energy, Roche Holding,
SGS-Thomson N.V., Sears Roebuck, Topps, Trafalgar House, 20th Century
Industries, Unisys, Unocal, U.S. Shoe, US West, Veba, Wheelabrator
Technologies.
Additions:
Allegheny Power Systems, Baker Hughes, CNA Financial, Champion
International, Dominion Resources, Dow Chemical, General Public Utilities,
Grace (W.R.), PacifiCorp, Philip Morris Cos., Public Service Enterprise
Group, Rowan Cos., Tyson Foods Cl. A, Witco.
SALES
Reductions:
American Home Products, Bowater, Gillette, Johnson & Johnson, Kanamoto,
Merck & Co., News ADS, Overseas Shipholding, Pfizer.
Eliminations:
Aiwa, American Electric Power, Asahi Tec, BBC Brown Boveri AG, Bombay,
Bridgestone, CBI Industries, Canon, Chubu Steel Plate, Club Mediterranee,
Dean Foods, Diamond Shamrock, Disco, Eurafrance, Foster Wheeler, Genzyme,
Hitachi Chemical, Household International, IBP, Illinois Tool Works,
International Paper, Kaufman & Broad Home, Kyocera, Lubrizol, Makino Milling,
NEC, Ngk Spark Plug, Nichiei, Nissho Iwai, Nomura Securities, OM Group, Pan
Holding, Pennzoil, Promise, Rohm, Sega Enterprises, Sharp, Stone Container,
Sumitomo, Takada Kiko, Temple-Inland, Tokki, Tostem, WHX, Yurtec.
Elimination of Securities Acquired During the Period:
AMR, Intel, Microsoft, SCE, Shaw Industries, Telefonos de Mexico ADS,
USAir Group, Union Bank of Switzerland.
*Increases resulting from stock splits and distributions are not shown.
<TABLE>
<CAPTION>
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
STATEMENT OF INVESTMENTS MARCH 31, 1995 (UNAUDITED)
COMMON STOCKS-76.6% SHARES VALUE
-------------- --------------
<S> <C> <C>
BASIC INDUSTRIES-6.1%........ Abitibi Price 100,000.(a) $ 1,400,000
Bowater................................ 50,000 1,787,500
Champion International................. 167,700 7,253,025
Dow Chemical........................... 175,000 12,775,000
Grace (W.R.) 150,000 7,987,500
Hemlo Gold Mines....................... 75,000 750,000
Witco ................................. 110,000 3,231,250
--------------
35,184,275
--------------
CAPITAL GOODS-4.6%......... Cooper Industries 225,000 8,718,750
Greif Brothers, Cl. A.................. 90,000 4,938,750
Norfolk Southern....................... 125,000 8,359,375
WMX Technologies....................... 150,000 4,125,000
--------------
26,141,875
--------------
CONGLOMERATES-.8%......... Tyco International 50,000 2,643,750
Whitman................................ 100,000 1,912,500
--------------
4,556,250
--------------
CONSUMER CYCLICAL-9.9%..... American Standard 425,000.(a) 10,518,750
Chrysler............................... 130,000 5,443,750
Federated Department Stores............ 125,000.(a) 2,765,625
General Motors......................... 550,000 24,337,500
Masco.................................. 100,000 2,762,500
Sears, Roebuck......................... 100,000 5,337,500
Topps.................................. 50,000 318,750
U.S. Shoe.............................. 100,000 2,637,500
Waban.................................. 150,000.(a) 2,962,500
--------------
57,084,375
--------------
CONSUMER STAPLES-19.2% American Home Products 194,400 13,851,000
Archer-Daniels-Midland................. 232,500 4,330,313
Bard (C.R.)............................ 140,000 3,867,500
Bristol-Myers Squibb................... 81,800 5,153,400
Circle K............................... 400,000.(a) 6,450,000
Gillette............................... 88,000 7,183,000
Johnson & Johnson...................... 70,000 4,165,000
Marion Merrell Dow..................... 110,000 2,722,500
McKesson............................... 40,000 1,615,000
Merck & Co............................. 394,481 16,814,753
National Health Labs Holdings.......... 200,000 3,000,000
News, ADS.............................. 307,000 5,871,375
Pfizer................................. 70,000 6,002,500
Philip Morris Cos...................... 400,000 26,100,000
Tyson Foods, Cl. A..................... 125,000 3,015,625
--------------
110,141,966
--------------
ENERGY-6.6%............. Arethusa (OFF-Shore) 465,000.(a) 6,132,188
Baker Hughes........................... 600,000 12,225,000
Dresser Industries..................... 320,000 6,800,000
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1995 (UNAUDITED)
COMMON STOCKS (CONTINUED) SHARES VALUE
-------------- --------------
ENERGY (CONTINUED)............ Global Marine 579,500.(a) $ 2,462,875
Rowan Cos.............................. 1,000,000.(a) 6,500,000
Unocal................................. 75,000 2,156,250
Wheelabrator Technologies.............. 100,000 1,362,500
--------------
37,638,813
--------------
FINANCIAL-3.6%............... CNA Financial 127,000.(a) 9,588,500
Equitable of Iowa...................... 89,700 3,038,587
MGIC Investment........................ 100,000 4,075,000
20th Century Industries................ 350,000 4,112,500
--------------
20,814,587
--------------
TECHNOLOGY-3.7% British Sky Broadcasting Group, ADS 97,700.(a) 2,405,862
Comcast UK Cable Partners, Cl. A....... 50,000.(a) 806,250
Comsat................................. 450,000 8,381,250
SGS-THOMSON N.V........................ 174,000.(a) 5,176,500
Unisys................................. 500,000.(a) 4,625,000
--------------
21,394,862
--------------
TRANSPORTATION-2.1%......... Alaska Air Group 250,000.(a) 3,968,750
Delta Air Lines........................ 100,000 6,275,000
Overseas Shipholding................... 86,400 1,771,200
--------------
12,014,950
--------------
UTILITIES-11.8%................ AT&T 200,000 10,350,000
Allegheny Power Systems................ 325,000 7,353,125
CINergy................................ 250,000 6,218,750
Dominion Resources..................... 205,400 7,394,400
Entergy................................ 163,600 3,415,150
General Public Utilities............... 189,000 5,504,625
NIPSCO Industries...................... 26,500 824,813
PECO Energy............................ 260,000 6,532,500
PacifiCorp............................. 350,000 6,781,250
Public Service Enterprise.............. 350,000 9,581,250
US West................................ 100,000 4,000,000
--------------
67,955,863
--------------
FOREIGN-8.2% Banque Privee Edmond de Rothschild 440 1,746,801
Fisons................................. 675,000 1,936,092
Iino Kaiun............................. 160,000. 1,037,140
Kanamoto............................... 2,000 40,370
Ladbroke............................... 2,150,000 5,888,086
Lonrho................................. 450,000 1,101,130
Nippon Yusen Kabushiki Kaisha.......... 160,000 981,776
Roche Holding.......................... 1,800 10,385,532
Trafalgar House........................ 10,500,000 9,188,235
Veba................................... 40,500 14,649,316
--------------
46,954,478
--------------
TOTAL COMMON STOCKS
(cost $386,905,448).................. $439,882,294
================
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1995 (UNAUDITED)
PREFERRED STOCK-.5% SHARES VALUE
-------------- --------------
News, ADS
(cost $1,447,858).................... 153,500 $ 2,647,875
==============
PRINCIPAL
AMOUNT
SUBJECT TO
CALL OPTIONS-.0% CALL
--------------
Bundesrepublik Deutschland,
6 5/8%, 1/20/1998,
April '95 @ 74.06 (b,c,f)
(cost $89,606) $ 15,000,000 $ 9,593
==============
CONTRACTS
SUBJECT TO
PUT OPTIONS-.0% PUT
--------------
Standard & Poor's 500 Index:
April '95 @ 480...................... 40,000 $ 47,500
May '95 @ 490........................ 40,000 160,000
--------------
..TOTAL PUT OPTIONS
(cost $377,400) $ 207,500
==============
PRINCIPAL
SHORT-TERM INVESTMENTS-10.6% AMOUNT
--------------
U.S. TREASURY BILLS:......... 3.20%, 4/6/1995 $ 8,438,000 $ 8,431,250
5.34%, 4/20/1995....................... 29,496,000.(d,e) 29,403,972
5.01%, 6/1/1995........................ 11,529,000 11,417,053
6.32%, 6/15/1995....................... 12,145,000 12,001,325
--------------
TOTAL SHORT-TERM INVESTMENTS
(cost $61,253,600)................... $ 61,253,600
============
TOTAL INVESTMENTS (cost $450,073,912)....................................... 87.7% $504,000,862
====== ===============
CASH AND RECEIVABLES (NET).................................................. . 12.3% $ 70,458,611
====== ==============
NET ASSETS.................................................................. 100.0% $574,459,473
========- ===============
</TABLE>
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
NOTES TO STATEMENT OF INVESTMENTS:
(a) Non-income producing.
(b) Denominated in German Deutsche Marks.
(c) Strike price subject to prevailing rate of exchange.
(d) Partially held by the custodian in a segregated account as collateral
for open financial futures positions.
(e) Partially held by broker as collateral for open short positions.
(f) Security restricted as to public resale. Investments in restricted
security, with an aggregate value of $9,593 represents approximately
.0% of net assets:
<TABLE>
<CAPTION>
ACQUISITION PURCHASE PERCENTAGE OF
ISSUER DATE PRICE NET ASSETS VALUATION*
------------- ------------ -------------- -------------- -------------
<S> <C> <C> <C> <C>
Bundesrepublik Deutschland,
6 5/8%, 1/20/1998, April '95 @ 74.06 4/27/94 $.60 .0% $0.06
* The valuation of this security has been determined in good faith under the
direction of the Board
of Directors.
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF FINANCIAL FUTURES MARCH 31, 1995 (UNAUDITED)
MARKET VALUE UNREALIZED
NUMBER OF COVERED (DEPRECIATION)
FINANCIAL FUTURES SOLD SHORT; CONTRACTS BY CONTRACTS EXPIRATION AT 3/31/95
- ------------------------------ ------------ -------------- ------------- -------------
<S> <C> <C> <C> <C>
Standard & Poor's 500........................... 240 $60,528,000 June '95 $(998,400)
==============
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF SECURITIES SOLD SHORT MARCH 31, 1995 (UNAUDITED)
COMMON STOCKS SHARES VALUE
- ----------------- ------------- -------------
<S> <C> <C>
Columbia/HCA Healthcare
(proceeds $1,867,644).............. 50,000 $2,150,000
=============
</TABLE>
See independent accountants' review report and notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
STATEMENT OF ASSETS AND LIABILITIES MARCH 31, 1995 (UNAUDITED)
ASSETS:
<S> <C> <C>
Investments in securities, at value
(cost $450,073,912)-see statement..................................... $504,000,862
Cash.................................................................... 18,966,782
Receivable from broker for proceeds on securities sold short............ 1,867,644
Receivable for investment securities sold............................... 91,564,430
Dividends receivable.................................................... 1,649,298
Receivable for subscriptions to Common Stock............................ 4,851
Receivable for futures variation margin-Note 4(a)....................... 240,000
Prepaid expenses........................................................ 71,942
--------------
618,365,809
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 357,203
Payable for investment securities purchased............................. 21,655,795
Bank loans payable-Note 2............................................... 17,600,000
Securities sold short, at value
(proceeds $1,867,644)-see statement................................... 2,150,000
Net unrealized depreciation on forward currency exchange
contracts-Note 4(a)................................................... 1,330,438
Payable for Common Stock redeemed....................................... 406,584
Loan commitment fees and interest payable............................... 3,552
Accrued expenses and other liabilities.................................. 402,764 43,906,336
------------- --------------
NET ASSETS ................................................................ $574,459,473
===============
REPRESENTED BY:
Paid-in capital......................................................... $521,251,268
Accumulated distributions in excess of investment
income-net-Note 1(c).................................................. (4,418,197)
Accumulated undistributed net realized gain on investments.............. 6,308,897
Accumulated net unrealized appreciation on investments
and foreign currency transactions [including ($998,400)
net unrealized (depreciation) on financial futures]-Note 4(b)......... 51,317,505
--------------
NET ASSETS at value applicable to 36,982,601 outstanding shares of
Common Stock, equivalent to $15.53 per share (100 million shares of
$1 par value authorized)................................................ $574,459,473
===============
</TABLE>
See independent accountants' review report and notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
STATEMENT OF OPERATIONS SIX MONTHS ENDED MARCH 31, 1995 (UNAUDITED)
<S> <C> <C>
INVESTMENT INCOME:
INCOME:
Interest...................................................... $5,902,892
Cash dividends (net of $10,903 foreign taxes withheld at source)...... 5,479,142
------------
TOTAL INCOME...................................................... $11,382,034
EXPENSES:
Management fee-Note 3(a).............................................. 2,108,204
Shareholder servicing costs-Note 3(b)................................. 656,926
Loan commitment fees-Note 2........................................... 87,208
Custodian fees........................................................ 80,812
Professional fees..................................................... 35,685
Directors' fees and expenses-Note 3(c)................................ 28,670
Prospectus and shareholders' reports.................................. 17,690
Interest-Note 2....................................................... 3,552
Dividends on securities sold short.................................... 1,500
Miscellaneous..................................................... 1,816
------------
TOTAL EXPENSES.................................................... 3,022,063
-------------
INVESTMENT INCOME-NET............................................. 8,359,971
-------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain (loss) on investments-Note 4(a):
Long transactions (including options transactions).................... $6,654,040
Short sale transactions............................................... (83,862)
Net realized gain on foreign currency transactions...................... 106,319
Net realized (loss) on forward currency exchange contracts-Note 4(a);
Short transactions.................................................... (3,946,582)
Net realized (loss) on financial futures-Note 4(a);
Short transactions.................................................... (2,982,530)
------------
NET REALIZED (LOSS)................................................... (252,615)
Net unrealized appreciation:
Investments and forward currency exchange contracts [including
($1,081,750) net unrealized (depreciation) on financial futures]...... 24,302,534
Translation of assets and liabilities in foreign currencies........... 1,749
------------
TOTAL UNREALIZED APPRECIATION..................................... 24,304,283
-------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................... 24,051,668
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $32,411,639
==============
</TABLE>
See independent accountants' review report and notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SIX MONTHS ENDED
SEPTEMBER 30, MARCH 31, 1995
1994 (UNAUDITED)
-------------- -------------------
<S> <C> <C>
OPERATIONS:
Investment income-net.................................................. $ 12,639,315 $ 8,359,971
Net realized gain (loss) on investments................................ 20,591,445 (252,615)
Net unrealized appreciation (depreciation) on investments for the period (41,885,909) 24,304,283
-------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...... (8,655,149) 32,411,639
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net.................................................. (26,079,930) (11,693,532)
Excess investment income-net........................................... --- (4,418,197)
Net realized gain on investments....................................... (72,371,864) (8,422,040)
-------------- --------------
TOTAL DIVIDENDS...................................................... (98,451,794) (24,533,769)
-------------- --------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold.......................................... 250,776,376 28,327,220
Dividends reinvested................................................... 88,813,669 21,932,842
Cost of shares redeemed................................................ (258,491,934) (54,038,355)
-------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS.... 81,098,111 (3,778,293)
-------------- --------------
TOTAL INCREASE (DECREASE) IN NET ASSETS.......................... (26,008,832) 4,099,577
NET ASSETS:
Beginning of period.................................................... 596,368,728 570,359,896
-------------- --------------
End of period [including undistributed investment income-net of
$3,333,561 in 1994 and distributions in excess of investment income-net
of $(4,418,197) in 1995]............................................. $570,359,896 $574,459,473
============== ==============
SHARES SHARES
-------------- --------------
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................ 14,069,123 1,878,746
Shares issued for dividends reinvested................................. 5,561,247 1,526,294
Shares redeemed........................................................ (14,647,204) (3,583,056)
-------------- --------------
NET INCREASE (DECREASE) IN SHARES OUTSTANDING........................ 4,983,166 (178,016)
============= ===============
</TABLE>
See independent accountants' review report and notes to financial statements.
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED SEPTEMBER 30, MARCH 31, 1995
---------------------------------------------------
PER SHARE DATA: 1990 1991 1992 1993 1994 (UNAUDITED)
------- ------- ------- ------- ------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.. $16.07 $14.31 $17.72 $18.11 $18.53 $15.35
------- ------- ------- ------- ------- -------
INVESTMENT OPERATIONS:
Investment income--net................ 67 .37 .32 .21 .40 .23
Net realized and unrealized gain (loss)
on investments...................... (1.73) 3.80 1.83 1.82 (.56) .62
------- ------- ------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS.... (1.06) 4.17 2.15 2.03 (.16) .85
------- ------- ------- ------- ------- -------
DISTRIBUTIONS:
Dividends from investment income--net. (.70) (.76) (.39) (.24) (.80) (.32)
Excess dividends from investment income--net .- .- .- .- .- (.12)
Dividends from net realized gain
on investments...................... -- -- (1.37) (1.37) (2.22) (.23)
------- ------- ------- ------- ------- -------
TOTAL DISTRIBUTIONS................. (.70) (.76) (1.76) (1.61) (3.02) (.67)
------- ------- ------- ------- ------- -------
Net asset value, end of period........ $14.31 $17.72 $18.11 $18.53 $15.35 $15.53
======= ======== ======== ======= ======= =======
TOTAL INVESTMENT RETURN (1)............... (6.90%) 30.27% 13.28% 12.04% (1.50%) 5.89%(2)
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to average
net assets.......................... 1.05% .97% .97% 1.02% 1.03% .52%(2)
Ratio of interest expense, loan commitment fees
and dividends on securities sold short to
average net assets.................. .29% .17% .10% .04% .09% .02%(2)
Ratio of net investment income to average
net assets.......................... 3.97% 2.13% 1.74% 1.24% 2.10% 1.49%(2)
Portfolio Turnover Rate............... 89.04% 81.02% 141.67% 102.23% 158.05% 130.29%(2)
Net Assets, end of period (000's Omitted) $400,981 $494,342 $520,895 $596,369 $570,360 $574,459
(1) Exclusive of sales charge.
(2) Not annualized.
</TABLE>
See independent accountants' review report and notes to financial statements.
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a diversified open-end management investment company. Premier Mutual Fund
Services, Inc. (the "Distributor") acts as the exclusive distributor of the
Fund's shares. The Distributor, located at One Exchange Place, Boston,
Massachusetts 02109, is a wholly-owned subsidiary of Institutional
Administrative Services, Inc., a provider of mutual fund administrative
services, the parent company of which is Boston Institutional Group, Inc. The
Dreyfus Corporation ("Manager") serves as the Fund's investment adviser. The
Manager is a direct subsidiary of Mellon Bank, N.A.
(A) PORTFOLIO VALUATION: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities
exchange on which such securities are primarily traded or at the last sales
price on the national securities market. Securities not listed on an exchange
or the national securities market, or securities for which there were no
transactions, are valued at the average of the most recent bid and asked
prices, except for open short positions, where the asked price is used for
valuation purposes. Bid price is used when no asked price is available.
Securities for which there are no such valuations are valued at fair value as
determined in good faith under the direction of the Board of Directors.
Short-term investments are carried at amortized cost, which approximates
value. Investments denominated in foreign currencies are translated to U.S.
dollars at the prevailing rates of exchange. Forward currency exchange
contracts are valued at the offsetting rate.
(B) FOREIGN CURRENCY TRANSACTIONS: The Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates
on investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Reported net realized foreign exchange gains or losses arise from sales
and maturities of short-term securities, sales of foreign currencies, the
difference between the amounts of dividends, interest and foreign withholding
taxes recorded on the Fund's books, and the U.S. dollar equivalent of the
amounts actually received or paid. Net unrealized foreign exchange gains and
losses arise from changes in the value of assets and liabilities other than
investments in securities at fiscal year end, resulting from changes in
exchange rates.
(C) 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.
(D) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net and dividends from net realized
capital gain 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. To the extent that net realized
capital gain can be offset by capital loss carryovers, if any, it is the
policy of the Fund not to distribute such gain.
(E) 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 Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
NOTE 2-BANK LINES OF CREDIT:
In accordance with an agreement with a bank, the Fund may borrow up to
$76 million under a short-term unsecured line of credit. In connection
therewith, the Fund has agreed to pay commitment fees at an annual rate of
.375 of 1% on the unused portion of the first $46 million of the line of
credit. No commitment fee is charged on the additional $30 million. Interest
on borrowings is charged at rates which are related to Federal Funds rates in
effect. Outstanding borrowings on March 31, 1995 under the line of credit,
amounted to $17.6 million, at an annualized interest rate of 7.16%.
The average daily amount of short-term debt outstanding during the six
months ended March 31, 1995 was approximately $97 thousand, with a related
weighted average annualized interest rate of 7.16% (based upon actual
interest expense, not including commitment fees, for the period). The maximum
amount of such debt outstanding at any time during the six months ended March
31, 1995, was $17.6 million.
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 3/4 of 1% of the average
daily value of the Fund's net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, interest on borrowings (which, in the
view of Stroock & Stroock & Lavan, counsel to the Fund, also contemplates
loan commitment fees and dividends on securities sold short), brokerage
commissions and extraordinary expenses, exceed 1 1/2% of the average value of
the Fund's net assets for any full fiscal year. No expense reimbursement was
required for the six months ended March 31, 1995.
Dreyfus Service Corporation retained $21,652 during the six months ended
March 31, 1995 from commissions earned on sales of Fund shares.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation an amount not to exceed an annual rate of .25 of
1% of the value of the Fund's average daily net assets for servicing
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 six months
ended March 31, 1995, the Fund was charged an aggregate of $331,327 pursuant
to the Shareholder Services Plan.
(C) Each director who is not an "affiliated person" of the Manager
receives an annual fee of $4,500 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 of investment securities
and securities sold short, excluding short-term securities, forward currency
exchange contracts and options transactions, during the six months ended
March 31, 1995 is summarized as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
----------------- -----------
<S> <C> <C>
Long transactions................................................ $550,085,660 $613,543,758
Short sale transactions.......................................... 4,272,436 6,056,218
----------------- ----------
TOTAL.......................................................... $554,358,096 $619,599,976
================- =============
</TABLE>
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
The Fund is engaged in short-selling which obligates the Fund to replace
the security borrowed by purchasing the security at
current market value. The Fund would incur a loss if the price of the
security increases between the date of the short sale and the date on which
the Fund replaces the borrowed security. The Fund would realize a gain if the
price of the security declines between those dates. Until the Fund replaces
the borrowed security, the Fund will maintain daily, a segregated account
with a broker and custodian, of cash and/or U.S. Government securities
sufficient to cover its short position. Securities sold short at March 31,
1995, and their related market values and proceeds are set forth in the
Statement of Securities Sold Short.
In addition, the following summarizes open forward currency exchange
contracts at March 31, 1995:
<TABLE>
<CAPTION>
U.S. DOLLAR
VALUE AT UNREALIZED
FORWARD CURRENCY SALE CONTRACTS PROCEEDS 3/31/95 (DEPRECIATION)
------------------------------- --------------- ---------------- --------------
<S> <C> <C> <C>
Swiss Francs, expiring 5/12/95......................... $ 1,541,385 $ 1,755,076 $ (213,691)
Swiss Francs, expiring 6/30/95......................... 25,398,324 25,881,581 (483,257)
British Pound, expiring 4/28/95........................ 4,992,640 5,184,960 (192,320)
British Pound, expiring 6/30/95........................ 13,029,127 13,203,058 (173,931)
Japanese Yen, expiring 4/28/95......................... 2,046,547 2,313,786 (267,239)
---------------
$(1,330,438)
===============
</TABLE>
When executing forward currency exchange contracts, the Fund is obligated
to buy or sell a foreign currency at a specified rate on a certain date in
the future. With respect to sales of forward currency exchange contracts, the
Fund would incur a loss if the value of the contract increases between the
date the forward contract is opened and the date the forward contract is
closed. The Fund realizes a gain if the value of the contract decreases
between those dates. With respect to purchases of forward currency exchange
contracts, the Fund would incur a loss if the value of the contract decreases
between the date the forward contract is opened and the date the forward
contract is closed. The Fund realizes a gain if the value of the contract
increases between those dates.
The Fund is engaged in trading financial futures contracts. The Fund is
exposed to market risk as a result of changes in the value of the underlying
financial instruments (see the Statement of Financial Futures). 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 contract at the close of
each day's trading. Accordingly, variation margin payments are made or
received 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 March 31,
1995 and their related unrealized market (depreciation) are set forth in the
Statement of Financial Futures.
(B) At March 31, 1995, accumulated net unrealized appreciation on
investments was $51,315,756, consisting of $54,213,478 gross unrealized
appreciation and $2,897,722 gross unrealized depreciation, excluding foreign
currency transactions.
At March 31 1995, 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).
DREYFUS CAPITAL GROWTH FUND (A Premier Fund)
REVIEW REPORT OF ERNST & YOUNG LLP, INDEPENDENT ACCOUNTANTS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS CAPITAL GROWTH FUND (A PREMIER FUND)
We have reviewed the accompanying statement of assets and liabilities of
Dreyfus Capital Growth Fund (A Premier Fund), including the statements of
investments, financial futures and securities sold short, as of March 31,
1995, and the related statements of operations and changes in net assets and
financial highlights for the six month period ended March 31, 1995. These
financial statements and financial highlights are the responsibility of the
Fund's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which
will be performed for the full year with the objective of expressing an
opinion regarding the financial statements and financial highlights taken as
a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the interim financial statements and financial highlights
referred to above for them to be in conformity with generally accepted
accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the statement of changes in net assets for the year ended
September 30, 1994 and financial highlights for the five years in the period
ended September 30, 1994 and in our report dated November 8, 1994, we
expressed an unqualified opinion on such statement of changes in net assets
and financial highlights.
(Ernst and Young Signature Logo)
New York, New York
May 5, 1995
(Dreyfus Lion Logo)
DREYFUS
CAPITAL GROWTH FUND
(A Premier Fund)
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
The Shareholder Services Group, Inc.
P.O. Box 9671
Providence, RI 02940
Further information is contained
in the Prospectus, which must
precede or accompany this report.
Printed in U.S.A. 009AR953
(Dreyfus Logo)
Capital Growth Fund
(A Premier Fund)
Semi-Annual
Report
March 31, 1995
Dreyfus Capital Growth Fund (A Premier Fund)
March 31, 1995
Asset Allocation
-------------------------------------------------------|
| Common Stocks 76.6 % |
| Cash Equivalents 22.9 % |
| Preferred Stocks 0.5 % |
| -------------------------------------------------------|
