Dreyfus
Growth Opportunity Fund, Inc.
SEMIANNUAL REPORT August 31, 1999
(reg.tm)
<PAGE>
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.
<PAGE>
Contents
THE FUND
2 Letter from the President
3 Discussion of Fund Performance
6 Statement of Investments
11 Statement of Assets and Liabilities
12 Statement of Operations
13 Statement of Changes in Net Assets
14 Financial Highlights
15 Notes to Financial Statements
FOR MORE INFORMATION
Back Cover
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The Fund
Dreyfus
Growth Opportunity Fund, Inc.
LETTER FROM THE PRESIDENT
Dear Shareholder:
We are pleased to present this semiannual report for Dreyfus Growth Opportunity
Fund, Inc. covering the six-month period from March 1, 1999 through August 31,
1999. Inside, you' ll find valuable information about how the fund was managed
during the reporting period, including a discussion with the fund's portfolio
manager, Timothy M.Ghriskey.
The past six months have been rewarding for most equity investors. Strong
economic growth, low inflation and high levels of consumer spending supported
continued strength in the stocks of many large companies. Several major market
indices set new records, including the Dow Jones Industrial Average, the broader
S& P 500 Index and the technology-laden NASDAQ Index.
Beginning in April, many previously out-of-favor market sectors rallied
strongly, including value-oriented stocks. This has helped narrow the valuation
gap that had developed over the past several years between the growth and value
sectors of the stock market.
We appreciate your confidence over the past six months, and we look forward to
your continued participation in Dreyfus Growth Opportunity Fund, Inc.
Sincerely,
Stephen E. Canter
President and Chief Investment Officer
The Dreyfus Corporation
September 14, 1999
<PAGE>
DISCUSSION OF FUND PERFORMANCE
Timothy M. Ghriskey, Senior Portfolio Manager
How did Dreyfus Growth Opportunity Fund, Inc. perform relative to its benchmark
For the six-month period ended August 31, 1999, Dreyfus Growth Opportunity Fund,
Inc. produced a total return of 5.04%.(1) This compares with a return of 7.32%
for the fund's benchmark, the Standard & Poor's 500 Composite Stock Price Index,
for the same period.(2)
We attribute our modest underperformance to the restructuring of the portfolio,
which occurred late last fall. At that time, we shifted the fund's focus away
from a pure value fund to represent more of a blended fund -- including both
value and growth stocks. While these changes held back performance during the
reporting period, we believe they will better position the fund going forward.
What is the fund's investment approach?
The fund invests in growth and value stocks, including stocks that exhibit
characteristics of both investment styles. We begin with a proprietary computer
model that identifies suitable candidates for the fund. We then reduce that list
of names by conducting fundamental research, and meeting with the management
teams of the remaining candidates. Specifically, we are looking for factors that
could signal a rise in the stock's price, including new products or markets,
opportunities for gaining greater market share, more effective management teams,
or positive changes in the company's corporate structure or market perception.
What other factors influenced the fund's performance?
The last six months have been characterized by stronger than expected economic
growth in the U.S. and overseas economies, which contributed to fears among
investors that the rate of inflation might accelerate from prevailing low
levels. These concerns prompted the Federal Reserve Board to raise short-term
interest rates twice during the summer of 1999.
The Fund
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DISCUSSION OF FUND PERFORMANCE (CONTINUED)
In April, a confluence of factors -- particularly improving economies in many
emerging market countries -- caused a shift in market sentiment away from highly
valued domestic large-cap growth stocks toward a broader group of companies,
including those selling at attractive prices relative to their earnings. The
major beneficiaries of the shift toward value were deep cyclical-type stocks,
including many chemical, paper, metal, energy and capital goods companies. By
the end of the period, however, the value rally appeared to have at least
temporarily ended, largely due to the market' s re-focus on the technology
sector.
The portfolio has recently focused on the technology sector, which is where we
have produced the greatest gains. In particular, we enjoyed significant returns
from some of the stocks that have continued to fuel the performance of the S&P
500, including Microsoft, Intel, Cisco Systems and International Business
Machines. However, not all of our technology holdings performed well. For
example, our investments in Compaq Computer held back the fund's performance due
to disappointing earnings. In addition, At Home, an Internet service provider,
produced lackluster returns due to potential competition within its cable
TV-delivered Internet space. Storage Technology, a data storage and hardware
equipment maker, suffered in large part because of a change in its distribution
agreement with International Business Machines. In all three of these cases, we
sold the stock.
In addition, energy and basic materials stocks contributed positively to the
fund' s performance. Energy stocks benefited from an increase in oil prices
during the period, while basic materials companies benefited from the shift
toward economically sensitive stocks in mid-April. What's more, several of the
fund' s energy and basic materials holdings reported strong gains because of
acquisitions made during the period, which resulted in significant cost-cutting
measures. Examples include BP Amoco, A.D.R. (formerly British Petroleum), which
benefited from its recent acquisitions of Amoco and Atlantic Richfield; and
Alcoa, a company that realized gains from its acquisition of Reynolds Metals.
Other strong performers in these areas include Mobil, International Paper, and
du Pont (E.I.) de Nemours.
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While the healthcare sector as a whole performed relatively poorly, our security
selection strategy within this sector produced positive returns for the fund.
Examples include Columbia/HCA Healthcare, an owner and manager of hospitals;
Warner-Lambert, a pharmaceutical company whose success is linked to its new
cholesterol-reducing drug, Lipitor; and Allergan, largely a biotechnology
company.
What is the fund's current strategy?
We have been encouraged by the stock market environment so far in 1999, and are
pleased with the number of positive investment opportunities that we have been
able to uncover. In our view, today's stock market is characterized by record
numbers of cash flows into mutual fund investments and an increased demand for
stocks by an ever-growing investment community. We believe that environment has
proved opportune for the fund's move to broaden its emphasis by including stocks
that employ both value AND growth types of investing.
September 14, 1999
(1) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. SHARE PRICE AND INVESTMENT
RETURN FLUCTUATE SUCH THAT UPON REDEMPTION FUND SHARES MAY BE WORTH MORE OR LESS
THAN THEIR ORIGINAL COST.
(2) SOURCE: LIPPER ANALYTICAL SERVICES, INC. -- REFLECTS THE REINVESTMENT OF
INCOME DIVIDENDS AND, WHERE APPLICABLE, CAPITAL GAINS DISTRIBUTIONS. THE
STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX IS A WIDELY ACCEPTED,
UNMANAGED INDEX OF U.S. STOCK MARKET PERFORMANCE.
The Fund
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<TABLE>
<CAPTION>
STATEMENT OF INVESTMENTS
August 31, 1999 (Unaudited)
COMMON STOCKS--99.6% Shares Value ($)
AEROSPACE & DEFENSE--.2%
<S> <C> <C>
Lockheed Martin 30,200 1,117,400
CONSUMER DURABLES--1.7%
Black & Decker 41,700 2,194,462
Ford Motor 51,300 2,674,013
General Motors 27,900 1,844,887
Newell Rubbermaid 26,400 1,082,400
7,795,762
CONSUMER NON-DURABLES--6.2%
Anheuser-Busch Cos. 33,000 2,541,000
Coca-Cola 102,600 6,136,763
Gillette 49,000 2,284,625
Kimberly-Clark 22,600 1,286,788
PepsiCo 115,900 3,955,087
Philip Morris Cos. 102,700 3,844,831
Procter & Gamble 59,000 5,855,750
Unilever, A.D.R 23,700 1,632,337
27,537,181
CONSUMER SERVICES--5.1%
Cendant 155,000 (a) 2,780,312
Clear Channel Communications 35,100 (a) 2,459,194
Comcast, Cl. A 33,100 1,079,887
Disney (Walt) 85,700 2,378,175
King World Productions 63,200 (a) 2,409,500
McDonald's 86,000 3,558,250
MediaOne Group 25,700 (a) 1,689,775
Time Warner 50,800 3,013,075
Viacom, Cl. B 81,800 (a) 3,440,713
22,808,881
ELECTRONIC TECHNOLOGY--18.5%
Apple Computer 38,500 (a) 2,512,125
Applied Materials 33,800 (a) 2,401,913
Boeing 20,400 924,375
Cisco Systems 197,400 (a) 13,386,187
Dell Computer 107,700a 5,257,106
EMC 42,200a 2,532,000
Hewlett-Packard 43,000 4,531,125
<PAGE>
COMMON STOCKS (CONTINUED) Shares Value ($)
ELECTRONIC TECHNOLOGY (CONTINUED)
Intel 206,000 16,930,625
International Business Machines 73,400 9,142,887
Lucent Technologies 189,500 12,139,844
Motorola 26,000 2,398,500
Nokia Oyj, A.D.S. 14,000 1,167,250
Nortel Networks 60,000 2,463,750
Sun Microsystems 36,000 (a) 2,862,000
Texas Instruments 36,000 2,954,250
United Technologies 20,300 1,342,338
82,946,275
ENERGY MINERALS 6.2%
BP Amoco, A.D.R. 27,400 3,072,225
Chevron 30,000 2,767,500
Conoco, Cl. B 59,089 1,588,003
Exxon 88,700 6,996,213
Mobil 44,200 4,524,975
Royal Dutch Petroleum A.D.R 90,200 5,581,125
Texaco 53,600 3,403,600
27,933,641
FINANCE--14.1%
Allstate 35,000 1,148,437
American Express 19,400 2,667,500
American General 31,000 2,201,000
American International Group 64,375 5,966,758
Bank One 81,600 3,274,200
Bank of America 111,000 6,715,500
Bank of New York 59,900 2,141,425
CIGNA 25,000 2,245,313
Chase Manhattan 59,000 4,937,563
Citigroup 217,500 9,665,156
Federal Home Loan Mortgage 28,300 1,457,450
Federal National Mortgage Association 70,200 4,361,175
First Union 79,200 3,286,800
Fleet Financial Group 53,600 2,133,950
Merrill Lynch 15,200 1,134,300
Morgan (J.P.) 11,100 1,433,981
The Fund
<PAGE>
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
COMMON STOCKS (CONTINUED) Shares Value ($)
FINANCE (CONTINUED)
Morgan Stanley Dean Witter & Co. 35,700 3,063,506
Schwab (Charles) 33,900 1,339,050
Wells Fargo 105,500 4,200,219
63,373,283
HEALTH SERVICES--.5%
Columbia/HCA Healthcare 92,800 2,285,200
HEALTH TECHNOLOGY--9.9%
Abbott Laboratories 64,500 2,797,687
American Home Products 56,800 2,357,200
Amgen 22,000a 1,830,125
Bristol-Myers Squibb 82,500 5,805,938
Johnson & Johnson 60,000 6,135,000
Lilly (Eli) 56,600 4,223,775
Medtronic 24,800 1,940,600
Merck & Co. 103,000 6,920,313
Pfizer 163,200 6,160,800
Pharmacia & Upjohn 10,700 559,075
Schering-Plough 36,000 1,892,250
Warner-Lambert 53,200 3,524,500
44,147,263
INDUSTRIAL SERVICES--.2%
Schlumberger 11,300 (a) 754,275
INTERNET--1.2%
eBay 43,600 (a) 5,474,525
NON-ENERGY MINERALS--1.2%
Alcoa 63,700 4,112,631
Inco 67,000 (a) 1,373,500
5,486,131
PROCESS INDUSTRIES--1.9%
Dow Chemical 27,000 3,067,875
duPont (E.I.) deNemours 28,070 1,778,936
International Paper 56,000 2,635,500
Sealed Air 18,100 (a) 1,063,375
8,545,686
PRODUCER MANUFACTURING--8.5%
AlliedSignal 23,600 1,445,500
Emerson Electric 10,000 626,250
<PAGE>
COMMON STOCKS (CONTINUED) Shares Value ($)
PRODUCER MANUFACTURING (CONTINUED)
General Electric 208,100 23,372,231
Honeywell 19,500 2,213,250
Illinois Tool Works 10,400 810,550
Ingersoll-Rand 17,500 1,113,438
Minnesota Mining & Manufacturing 16,700 1,578,150
Tyco International 54,000 5,470,875
Xerox 27,400 1,308,350
37,938,594
RETAIL TRADE--6.0%
Albertson's 17,330 830,757
CVS 16,000 667,000
Dayton Hudson 35,300 2,047,400
Federated Department Stores 48,400 (a) 2,226,400
Gap 35,550 1,390,894
Home Depot 72,000 4,401,000
Lowes 22,000 995,500
Safeway 20,500 954,531
Wal-Mart Stores 279,700 12,394,206
Walgreen 41,400 959,963
26,867,651
TECHNOLOGY SERVICES--6.9%
America Online 68,300 (a) 6,236,644
Computer Associates International 2,100 118,650
Electronic Data Systems 39,000 2,188,875
Microsoft 218,000 (a) 20,178,625
Oracle 62,500 (a) 2,281,250
31,004,044
TRANSPORTATION--.7%
CNF Transportation 60,300 2,347,931
Union Pacific 18,100 881,244
3,229,175
UTILITIES--10.6%
AT&T 132,688 5,970,960
AT&T--Liberty Media Group, Cl. A 136,000 (a) 4,352,000
Ameritech 109,400 6,905,875
Bell Atlantic 33,700 2,064,125
BellSouth 78,600 3,556,650
The Fund
<PAGE>
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
COMMON STOCKS (CONTINUED) Shares Value ($)
UTILITIES (CONTINUED)
Coastal 106,000 4,591,125
Enron 30,000 1,256,250
GTE 69,300 4,755,712
MCI WorldCom 78,900 (a) 5,976,675
Sprint (Fon Group) 37,100 1,646,313
Sprint (PCS Group) 19,000 (a) 1,135,250
Texas Utilities 100,000 4,043,750
U S West 21,000 1,097,250
47,351,935
TOTAL COMMON STOCKS
(cost $363,392,222) 446,596,902
Principal
SHORT-TERM INVESTMENTS--.1% Amount ($) Value ($)
U.S. TREASURY BILLS;
4.80%, 11/26/99
(cost $374,654) 379,000 374,653
TOTAL INVESTMENTS (cost $363,766,876) 99.7% 446,971,555
CASH AND RECEIVABLES (NET) .3% 1,364,657
NET ASSETS 100.0% 448,336,212
(A) NON-INCOME PRODUCING.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
August 31, 1999 (Unaudited)
Cost Value
ASSETS ($):
Investments in securities--See Statement of
Investments 363,766,876 446,971,555
Cash 1,199,106
Receivable for investment securities sold 5,640,569
Dividends receivable 559,863
Receivable for shares of Common Stock subscribed 35,000
Prepaid expenses 20,759
454,426,852
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 301,743
Payable for investment securities purchased 5,656,676
Payable for shares of Common Stock redeemed 66,073
Accrued expenses 66,148
6,090,640
NET ASSETS ($) 448,336,212
COMPOSITION OF NET ASSETS ($):
Paid-in capital 350,935,556
Accumulated undistributed investment income--net 605,426
Accumulated net realized gain (loss) on investments 13,590,551
Accumulated net unrealized appreciation (depreciation)
on investments --Note 4(b) 83,204,679
NET ASSETS ($) 448,336,212
SHARES OUTSTANDING
(100 million shares of $.001 par value Common Stock authorized) 43,923,688
NET ASSET VALUE, offering and redemption price per share ($) 10.21
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
<PAGE>
STATEMENT OF OPERATIONS
Six Months Ended August 31, 1999 (Unaudited)
INVESTMENT INCOME ($):
INCOME:
Cash dividends (net of $30,996 foreign taxes withheld at source) 2,647,412
Interest 166,903
TOTAL INCOME 2,814,315
EXPENSES:
Management fee--Note 3(a) 1,753,591
Shareholder servicing costs--Note 3(b) 561,566
Professional fees 35,066
Directors' fees and expenses--Note 3(c) 34,269
Custodian fees--Note 3(b) 21,640
Registration fees 20,829
Prospectus and shareholders' reports 14,923
Interest expense-Note 2 5,950
Miscellaneous 7,515
TOTAL EXPENSES 2,455,349
INVESTMENT INCOME--NET 358,966
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):
Net realized gain (loss) on investments 14,372,476
Net realized gain (loss) on financial futures 261,461
NET REALIZED GAIN (LOSS) 14,633,937
Net unrealized appreciation (depreciation) on investments 8,857,451
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 23,491,388
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 23,850,354
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
August 31, 1999 Year Ended
(Unaudited) February 28, 1999
OPERATIONS ($):
Investment income--net 358,966 2,995,352
Net realized gain (loss) on investments 14,633,937 69,955,132
Net unrealized appreciation (depreciation)
on investments 8,857,451 (26,780,009)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 23,850,354 46,170,475
DIVIDENDS TO SHAREHOLDERS FROM ($):
Investment income--net -- (3,072,334)
Net realized gain on investments (41,546,683) (19,444,090)
TOTAL DIVIDENDS (41,546,683) (22,516,424)
CAPITAL STOCK TRANSACTIONS ($):
Net proceeds from shares sold 183,671,692 427,315,063
Dividends reinvested 40,104,847 21,694,078
Cost of shares redeemed (216,936,449) (522,033,194)
INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL STOCK TRANSACTIONS 6,840,090 (73,024,053)
TOTAL INCREASE (DECREASE) IN NET ASSETS (10,856,239) (49,370,002)
NET ASSETS ($):
Beginning of Period 459,192,451 508,562,453
END OF PERIOD 448,336,212 459,192,451
Undistributed investment income--net 605,426 246,460
CAPITAL SHARE TRANSACTIONS (SHARES):
Shares sold 17,554,349 41,353,693
Shares issued for dividends reinvested 3,951,216 2,139,455
Shares redeemed (20,667,494) (50,515,617)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING 838,071 (7,022,469)
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
</TABLE>
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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
August 31,
1999 Fiscal Year Ended February,
(Unaudited) 1999 1998 1997 1996 1995
PER SHARE DATA ($):
Net asset value,
<S> <C> <C> <C> <C> <C> <C>
beginning of period 10.66 10.15 10.22 9.56 8.67 10.89
Investment Operations:
Investment income--net .01(a) .07 .05 .10 .10 .10
Net realized and unrealized
gain (loss) on investments .52 .97 1.39 1.93 2.19 (.38)
Total from Investment Operations .53 1.04 1.44 2.03 2.29 (.28)
Distributions:
Dividends from investment
income--net -- (.07) (.07) (.09) (.12) (.09)
Dividends from net realized
gain on investments (.98) (.46) (1.22) (1.28) (1.26) (1.80)
Dividends in excess of net realized
gain on investments -- -- (.22) -- (.02) (.05)
Total Distributions (.98) (.53) (1.51) (1.37) (1.40) (1.94)
Net asset value, end of period 10.21 10.66 10.15 10.22 9.56 8.67
TOTAL RETURN (%) 5.04(b) 10.57 15.62 22.35 27.37 (2.11)
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to
average net assets .52(b) 1.04 1.06 1.06 1.04 1.10
Ratio of net investment income
to average net assets .08(b) .64 .50 .91 .91 1.09
Portfolio Turnover Rate 43.54(b) 162.98 112.32 137.38 268.40 242.75
Net Assets, end of period
($ x 1,000) 448,336 459,192 508,562 471,660 419,240 372,313
(A) BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
(B) NOT ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Significant Accounting Policies:
Dreyfus Growth Opportunity Fund, 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
provide long-term capital growth consistent with the preservation of capital.
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 (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. 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. 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 forward 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 the market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and maturities of
short-term securities, sales of foreign currencies, The Fun
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
currency gains or losses realized on securities transactions and the difference
between the amount 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, resulting from changes in exchange rates. Such gains and losses are
included with net realized and unrealized gain or loss on investments.
(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 discounts 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.
(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 of 1986, as amended (the "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 Code,
and to make distributions of taxable income sufficient to relieve it from
substantially all Federal income and excise taxes.
NOTE 2--Bank Line of Credit:
The fund participates with other Dreyfus-managed funds in a $600 million
redemption credit facility (the "Facility" ) to be utilized for temporary or
emergency purposes, including the financing of
<PAGE>
redemptions. In connection therewith, the fund has agreed to pay commitment fees
on its pro rata portion of the Facility. Interest is charged to the fund at
rates based on prevailing market rates in effect at the time of borrowings
The average daily amount of borrowings outstanding during the period ended
August 31, 1999 was approximately $226,100 with a related weighted average
annualized interest rate of 5.22%.
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 .75 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, brokerage, interest on borrowings (which in the view of Stroock, Stroock
& Lavan LLP, counsel to the fund, also includes loan commitment fees) and
extraordinary expenses, exceed 11_2% of the average value of the fund's average
daily net assets, the Manager will bear such excess expense. During the period
ended August 31, 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 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
August 31, 1999, the fund was charged $403,136 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 provid The Fun
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
ing personnel and facilities to perform transfer agency services for the fund.
During the period ended August 31, 1999, the fund was charged $105,121 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 August 31, 1999, the fund was
charged $21,640 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 $4,500 and an attendance fee of $500 per
meeting. The Chairman of the Board receives an additional 25% of such
compensation.
(d) During the period ended August 31, 1999, the fund incurred total brokerage
commissions of $357,615, of which $14,615 was paid to Dreyfus Brokerage
Services, a wholly-owned subsidiary of Mellon Bank Corporation.
NOTE 4--Securities Transactions:
(a) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities and financial futures, during the period ended
August 31, 1999, amounted to $197,146,672 and $226,912,429, respectively.
The fund may invest in financial 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, of up to approximately 10% of the contract amount. The amount of
these deposits is determined by the exchange or Board o
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Trade on which the contract is traded and is subject to change. At August 31,
1999, there were no financial futures contracts outstanding.
(b) At August 31, 1999, accumulated net unrealized appreciation on investments
was $83,204,679, consisting of $90,812,925 gross unrealized appreciation and
$7,608,246 gross unrealized depreciation.
At August 31, 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
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NOTES
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For More Information
Dreyfus Growth Opportunity Fund, 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 018SA998
