LETTER TO SHAREHOLDERS
Dear Shareholder:
The latest fiscal year for The Dreyfus Third Century Fund, which ended
May 31, 1994, has been a time of very active repositioning of the Fund. There
have been extensive changes in the Fund's portfolio, particularly in the past
several months. In addition, we have identified a new sub-investment advisory
firm, to help with managing the Fund's portfolio upon shareholder approval.
These actions have been carried out in an environment of unusually volatile
stock prices.
In making portfolio changes, we sold stocks that were not performing
well, or where we had profits that we thought could be better employed
elsewhere. We bought stocks that we thought should do better in the current
economic environment of faster economic growth, higher interest rates, and
inflation that has been quiescent but not totally eliminated as a threat.
Broadly speaking, we sold some pharmaceuticals, a group that has
performed poorly, while adding a few health care service stocks, where we
believe prospects are better. We cut back on some financial services
holdings, which underperformed the market averages for that category, and
also retrenched in the consumer area, which has lagged behind the general
growth in the economy.
To replace these securities, we have been shifting funds into cyclical
industries that we think should benefit from an expanding economy and into
some technology issues, an industry group that has fared well in recent
months. Although we now find a number of cyclical industries to be
attractive, we must choose carefully because many manufacturing companies
fail to meet our criteria for social responsibility.
For the full fiscal year through May 31, 1994, the total return of the
Fund was -0.63%.* For the same period, the Dow Jones Industrial Average
gained 9.50% and the Standard & Poor's 500 Composite Stock Price Index
advanced 4.25%.**
The Fund's holdings in the field of health care were the largest negative
factor in the Fund's performance during the fiscal period. The poorest
performers among sizable holdings in the portfolio were Merck & Co., Elan,
Astra A Free and Health Care & Retirement. We decided to retain our holdings
in Merck & Co. for now, in the belief that the worst may be over for that
company. However, we sold out our positions in the three other companies.
Late in the fiscal period, we acquired a major holding in Amgen at what we
consider to be favorable prices. In the technology sector, we made portfolio
changes at a net profit for the Fund. Major sales included General Motors
Class E, and Adaptec and Informix. Among finance stocks, we sold J.P. Morgan,
Banc One, Bank of New York, Wachovia and Allmerica Property and Casualty Cos.
Some of the proceeds from these sales were put to work by purchasing such
stocks as Dollar General in the retail field; American International Group
and Federal National Mortgage Association in the financial sector; Disney
(Walt) in the entertainment industry; and technology stocks that included
Hewlett-Packard and Seagate Technology, plus Ameritech, a regional telephone
company with major technology activities.
To carry out the portfolio changes required raising large amounts of
cash, which at one point late in the fiscal year reached over 50%, held
temporarily in U.S. Treasury bills. By May 31, this cash position had been
cut to 32% by new investments, and it has been still further reduced in June
by additional stock purchases. We regard the remaining cash as a potent
reserve that can be put to work in investments as attractive opportunities
arise.
While making these changes in the portfolio, we have taken steps to add
to the investment expertise available for advising the Fund's management. The
Fund's Board of Directors has approved, and shareholders have been asked to
vote on a new Sub-Investment Advisory Agreement which provides that Dreyfus
will engage NCM Capital Management Group, Inc. as the Fund's sub-investment
advisor. As of March 31, 1994 NCM Capital, located in Durham, N.C., had a
37-member professional staff, 70 institutional clients and over $2.2 billion
in assets under management including a number of corporate and pension fund
accounts.
We now hope to return to the growth pattern that has characterized the
Fund for most of the 22 years that it has been in business. We appreciate
your investment in the Fund and will continue to devote our best efforts to
bringing you competitive returns on your Fund shares.
Sincerely,
(Howard Stein Signature Logo)
Howard Stein
Chairman of the Board
June 16, 1994
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. Both the Dow Jones Industrial Average and the Standard &
Poor's 500 Composite Stock Price Index are widely accepted unmanaged
indexes of stock market performance.
PERFORMANCE
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE DREYFUS THIRD
CENTURY FUND, INC. AND THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
$109,667
Dreyfus Third Century Fund
$105,101
Standard & Poor's 500 Composite Stock Price Index*
[Exhibit A]
*Source: Lipper Analytical Services, Inc.
AVERAGE ANNUAL TOTAL RETURN
ONE YEAR ENDED FIVE YEARS ENDED TEN YEARS ENDED SINCE INCEPTION (3/29/72)
MAY 31, 1994 MAY 31, 1994 MAY 31, 1994 TO MAY 31, 1994
- -------------- ----------------- ---------------- -------------------
-0.63% 9.32% 12.56% 11.40%
Past performance is not predictive of future performance.
The above graph compares a $10,000 investment made in The Dreyfus Third
Century Fund on 3/29/72 (Inception Date) to a $10,000 investment made in the
Standard and Poor's 500 Composite Stock Price Index on that date. For
comparative purposes, the value of the Index on 3/31/72 is used as the
beginning value on 3/29/72. All dividends and capital gain distributions are
reinvested.
The Dreyfus Third Century Fund primarily seeks capital growth through
investment in common stocks of companies that, in the opinion of the Fund's
management, not only meet traditional investment standards, but which also
show evidence that they conduct their business in a manner that contributes
to the enhancement of the quality of life in America. Current income is a
secondary goal. The Fund's performance takes into account all applicable fees
and expenses. The Standard and Poor's 500 Composite Stock Price Index is a
widely accepted, unmanaged index of overall stock market performance which
does not take into account charges, fees and other expenses and is not
subject to the same socially responsible investment criteria as The Dreyfus
Third Century Fund. Further information relating to Fund performance is
contained in the Condensed Financial Information section of the Prospectus
and elsewhere in this report.
<TABLE>
<CAPTION>
THE DREYFUS THIRD CENTURY FUND, INC. MAY 31, 1994
ASSET ALLOCATION
Cash Equivalents (32.1%)
Common Stocks (67.9%)
[Exhibit B]
FIVE LARGEST SECTORS
<S> <C>
Finance................................................. 15.4%
Technology.............................................. 9.9
Health Care............................................. 8.6
Producer Manufacturing.................................. 6.9
Retail Trade............................................ 5.3
TEN LARGEST HOLDINGS
AFLAC................................................... 2.8%
Merck & Co.............................................. 2.7
Sigma-Aldrich........................................... 2.1
EMC..................................................... 1.7
Dollar General.......................................... 1.7
Southwest Airlines...................................... 1.6
First Union............................................. 1.6
Oracle Systems.......................................... 1.4
Lennar.................................................. 1.4
American International Group............................ 1.4
</TABLE>
All percentages shown above are based on Total Net Assets.
<TABLE>
<CAPTION>
THE DREYFUS THIRD CENTURY FUND, INC.
STATEMENT OF INVESTMENTS MAY 31, 1994
COMMON STOCKS--67.9% SHARES VALUE
-------------- --------------
<S> <C> <C> <C>
BASIC & PROCESS INDUSTRIES-- 4.7% American Barrick Resources....... 160,000 $ 3,960,000
Cleveland-Cliffs................. 56,000 1,974,000
Praxair.......................... 139,100 2,834,163
Sigma-Aldrich.................... 200,000 8,300,000
Vallen.........................(a) 124,750 1,465,813
-------------
18,533,976
-------------
CONSUMER DURABLES-- 2.5% Clayton Homes..................(a) 114,400 2,216,500
Leggett & Platt.................. 55,100 2,066,250
Lennar........................... 300,000 5,550,000
-------------
9,832,750
-------------
CONSUMER NON-DURABLES-- 2.8% Coca-Cola 100,000 4,037,500
Colgate-Palmolive................ 41,700 2,387,325
Gillette......................... 38,100 2,657,475
Oxford Industries................ 55,700 1,852,025
-------------
10,934,325
-------------
CONSUMER SERVICES-- 1.3% Disney (Walt) 115,000 4,973,750
-------------
ENERGY-- .9% Anadarko Petroleum 25,000 1,343,750
Tosco............................ 80,500 2,354,625
-------------
3,698,375
-------------
FINANCE-- 15.4% ADVANTA, Cl. A................... 76,600 2,949,100
AFLAC............................ 330,000 11,055,000
American International Group..... 57,500 5,369,062
Bankers Trust New York........... 34,000 2,392,750
Bear Stearns..................... 124,100 2,528,537
Dean Witter, Discover & Co....... 40,000 1,560,000
Federal National Mortgage Association 62,100 5,185,350
First Chicago.................... 40,100 2,120,288
First Union...................... 132,500 6,194,375
Green Tree Financial............. 54,100 3,185,138
Lincoln National................. 60,000 2,482,500
Midlantic........................ 84,500 2,619,500
NationsBank...................... 52,700 2,918,262
PXRE............................. 60,000 1,575,000
Paine Webber Group............... 143,100 2,361,150
State Street Boston.............. 75,000 3,042,188
T. Rowe Price Association........ 86,400 2,608,200
-------------
60,146,400
-------------
HEALTH CARE-- 8.6%. ALZA............................. 43,000 1,069,625
Amgen..........................(a) 63,100 2,938,094
Becton, Dickinson................ 64,500 2,459,062
Columbia/ HCA Healthcare......... 70,000 2,782,500
Cordis.........................(a) 57,500 2,867,812
Forest Laboratories............(a) 67,500 2,970,000
Genelabs Technologies........(a,b) 277,778 687,501
HealthCare COMPARE.............(a) 100,000 1,975,000
Medtronic........................ 32,000 2,632,000
THE DREYFUS THIRD CENTURY FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1994
COMMON STOCKS (CONTINUED) SHARES VALUE
-------------- --------------
HEALTH CARE (CONTINUED) Merck & Co....................... 349,702 $ 10,665,911
NovaCare.......................(a) 149,200 2,666,950
-------------
33,714,455
-------------
INDUSTRIAL SERVICES-- 1.5% Fluor............................ 60,000 3,060,000
Jacobs Engineering Group.......(a) 163,800 2,989,350
-------------
6,049,350
-------------
PRODUCER MANUFACTURING-- 6.9% AGCO............................. 68,000 2,618,000
Armstrong World Industries....... 44,800 2,184,000
Briggs & Stratton................ 28,900 2,181,950
Clark Equipment................(a) 40,900 2,632,937
Cummins Engine................... 49,000 2,100,875
Deere & Co....................... 28,700 2,001,825
Eaton............................ 41,700 2,293,500
Federal-Mogul.................... 82,000 2,419,000
Gardner Denver Machinery......... 5,700 53,081
Grainger (W.W.).................. 50,000 3,256,250
Ingersoll-Rand................... 25,000 875,000
Magna International, Cl. A....... 51,500 2,285,313
Miller (Herman).................. 87,900 2,153,550
-------------
27,055,281
-------------
RETAIL TRADE-- 5.3% American Stores 47,100 1,177,500
Burlington Coat Factory........(a) 95,600 1,864,200
Dollar General................... 254,687 6,685,547
Heilig-Meyers.................... 78,000 2,223,000
Lowe's........................... 37,500 1,176,563
Nationsmart (Warrants)........... 16,700 6,262
Penney (J.C.).................... 45,600 2,331,300
Pier 1 Imports................... 288,500 2,380,125
Seventh Generation...........(a,b) 57,000 250,087
Wal-Mart Stores.................. 100,000 2,350,000
-------------
20,444,584
-------------
TECHNOLOGY-- 9.9% Applied Materials..............(a) 54,200 2,364,475
Compaq Computer................(a) 24,600 2,908,950
Computer Associates International 78,300 3,259,237
E-Systems........................ 55,100 2,183,338
EMC............................(a) 400,000 6,750,000
Hewlett-Packard.................. 58,800 4,615,800
Linear Technology................ 57,300 2,578,500
Micron Technology................ 29,000 975,125
Motorola......................... 20,000 935,000
Oracle Systems.................(a) 165,000 5,651,250
Seagate Technology.............(a) 160,000 3,730,000
Texas Instruments................ 31,400 2,519,850
-------------
38,471,525
-------------
TRANSPORTATION-- 5.1% Airborne Freight................. 69,500 2,632,313
Illinois Central................. 132,500 4,604,375
Santa Fe Pacific................. 106,100 2,413,775
THE DREYFUS THIRD CENTURY FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1994
COMMON STOCKS (CONTINUED) SHARES VALUE
-------------- --------------
TRANSPORTATION (CONTINUED) Southwest Airlines............... 230,000 $ 6,411,250
Union Pacific.................... 62,000 3,658,000
-------------
19,719,713
-------------
UTILITIES-TELEPHONE-- 3.0% AT & T........................... 20,000 1,090,000
Ameritech........................ 126,900 4,964,962
Southwestern Bell................ 70,000 2,878,750
Sprint........................... 70,500 2,679,000
-------------
11,612,712
-------------
TOTAL COMMON STOCKS
(cost $239,030,056)........... $265,187,196
=============
PRINCIPAL
SHORT-TERM INVESTMENTS--31.6% AMOUNT
--------------
U.S. TREASURY BILLS: 3.67%, 6/2/94.................... $ 47,080,000 $ 47,075,196
3.55%, 6/16/94................... 9,667,000 9,652,701
3.81%, 6/23/94................... 25,489,000 25,429,653
3.74%, 6/30/94................... 23,493,000 23,422,221
3.60%, 7/7/94.................... 17,750,000 17,686,100
-------------
TOTAL SHORT-TERM INVESTMENTS
(cost $123,265,871).......... $ 123,265,871
=============
TOTAL INVESTMENTS (cost $362,295,927)....................................... 99.5% $ 388,453,067
====== =============
CASH AND RECEIVABLES (NET).................................................. .5% $ 1,887,113
====== =============
NET ASSETS.................................................................. 100.0% $ 390,340,180
====== =============
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Non-income producing.
(b) Security restricted as to public resale. Investments in restricted
securities, with an aggregate cost of $2,950,001,representing
approximately .76% of net assets:
<TABLE>
<CAPTION>
ACQUISITION PURCHASE PERCENTAGE OF
ISSUER DATE PRICE NET ASSETS VALUATION*
- ------ ----------- ---------- --------------- ----------------
<S> <C> <C> <C> <C>
Genelabs Technologies................... 5/5/89 and $ 7.20+ .18% 10% discount to
3/1/91 market value
Seventh Generation...................... 9/26/90 $16.67 .06% 10% discount to
market value
- ---------------------------
* The valuation of this security has been determined in good faith under the
direction of the Board of Directors.
+ Average cost.
</TABLE>
See notes to financial statements.
<TABLE>
<CAPTION>
THE DREYFUS THIRD CENTURY FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES MAY 31, 1994
ASSETS:
<S> <C> <C>
Investments in securities, at value
(cost $362,295,927)_see statement..................................... $388,453,067
Cash.................................................................... 379,416
Receivable for investment securities sold............................... 1,531,076
Dividends receivable.................................................... 403,980
Receivable for subscriptions to Common Stock............................ 5,864
Prepaid expenses and other assets....................................... 120,963
--------------
390,894,366
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $170,128
Due to Tiffany Capital Advisors, Inc.................................... 74,295
Payable for Common Stock redeemed....................................... 15,053
Accrued expenses........................................................ 294,710 554,186
---------- --------------
NET ASSETS.................................................................. $390,340,180
=============
REPRESENTED BY:
Paid-in capital......................................................... $326,460,566
Accumulated undistributed investment income_net......................... 1,020,521
Accumulated undistributed net realized gain on investments.............. 36,701,953
Accumulated net unrealized appreciation on investments_Note 3........... 26,157,140
--------------
NET ASSETS at value applicable to 50,011,741 shares outstanding
(150 million shares of $.33 1/3 par value Common Stock authorized)...... $390,340,180
=============
NET ASSET VALUE, offering and redemption price per share
($390,340,180 / 50,011,741 shares)...................................... $7.80
=====
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
THE DREYFUS THIRD CENTURY FUND, INC.
STATEMENT OF OPERATIONS
YEAR ENDED MAY 31, 1994
INVESTMENT INCOME:
INCOME:
<S> <C> <C>
Cash dividends (net of $21,204 foreign taxes withheld at source)...... $ 4,577,016
Interest.............................................................. 3,556,804
--------------
TOTAL INCOME.................................................... $ 8,133,820
EXPENSES:
Investment advisory fee--Note 2(a).................................... 2,374,676
Sub-investment advisory fee_Note 2(a)................................. 1,224,676
Shareholder servicing costs_Note 2(b)................................. 1,604,345
Professional fees..................................................... 104,341
Custodian fees........................................................ 86,355
Directors' fees and expenses_Note 2(c)................................ 43,162
Registration fees..................................................... 37,192
Prospectus and shareholders' reports.................................. 24,434
Miscellaneous......................................................... 110,010
--------------
TOTAL EXPENSES.................................................. 5,609,191
-------------
INVESTMENT INCOME--NET.......................................... 2,524,629
-------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments--Note 3................................ 43,262,547
Net unrealized appreciation (depreciation) on investments for the year:
Unaffiliated issuers.................................................. $(42,785,849)
Affiliated issuers.................................................... 475,000 (42,310,849)
-------------- -------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................. 951,698
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $ 3,476,327
=============
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
THE DREYFUS THIRD CENTURY FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MAY 31,
----------------------------------
1993 1994
-------------- --------------
<S> <C> <C>
OPERATIONS:
Investment income--net............................................... $ 2,338,779 $ 2,524,629
Net realized gain on investments..................................... 34,235,279 43,262,547
Net unrealized appreciation (depreciation) on investments for the year 11,273,164 (42,310,849)
-------------- --------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............... 47,847,222 3,476,327
-------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net............................................... (2,772,024) (2,357,310)
Net realized gain on investments..................................... (3,388,031) (35,948,936)
-------------- --------------
TOTAL DIVIDENDS.................................................... (6,160,055) (38,306,246)
-------------- --------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold........................................ 247,614,777 133,886,002
Dividends reinvested................................................. 5,916,878 36,994,901
Cost of shares redeemed.............................................. (212,416,606) (272,045,796)
-------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS.. 41,115,049 (101,164,893)
-------------- --------------
TOTAL INCREASE (DECREASE) IN NET ASSETS........................ 82,802,216 (135,994,812)
NET ASSETS:
Beginning of year.................................................... 443,532,776 526,334,992
-------------- --------------
End of year (including undistributed investment income_net:
$853,202 in 1993 and $1,020,521 in 1994,........................... $526,334,992 $390,340,180
============== ==============
SHARES SHARES
-------------- --------------
CAPITAL SHARE TRANSACTIONS:
Shares sold.......................................................... 30,554,379 15,961,262
Shares issued for dividends reinvested............................... 709,457 4,572,917
Shares redeemed...................................................... (26,057,343) (32,586,800)
-------------- --------------
NET INCREASE (DECREASE) IN SHARES OUTSTANDING...................... 5,206,493 (12,052,621)
============== ==============
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
THE DREYFUS THIRD CENTURY FUND, INC.
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 year indicated. This information
has been derived from the Fund's financial statements.
YEAR ENDED MAY 31,
--------------------------------------------------------------
PER SHARE DATA: 1990 1991 1992 1993 1994
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year.............. $ 6.33 $ 7.01 $ 7.79 $ 7.80 $ 8.48
------- ------- ------- ------- -------
INVESTMENT OPERATIONS:
Investment income--net.......................... .21 .06 .05 .04 .05
Net realized and unrealized gain (loss) on investments .84 1.07 .26 .74 (.08)
------- ------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS.............. 1.05 1.13 .31 .78 (.03)
------- ------- ------- ------- -------
DISTRIBUTIONS:
Dividends from investment income--net........... (.18) (.12) (.08) (.05) (.04)
Dividends from net realized gain on investments. (.19) (.23) (.22) (.05) (.61)
------- ------- ------- ------- -------
TOTAL DISTRIBUTIONS........................... (.37) (.35) (.30) (.10) (.65)
------- ------- ------- ------- -------
Net asset value, end of year.................... $ 7.01 $ 7.79 $ 7.80 $ 8.48 $ 7.80
======= ======= ======= ======= =======
TOTAL INVESTMENT RETURN 17.26% 17.19% 3.92% 10.02% (.63%)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets......... 1.05% 1.04% 1.08% 1.11% 1.17%
Ratio of net investment income to average net assets 3.19% 1.10% .83% .48% .52%
Portfolio Turnover Rate......................... 162.82% 72.57% 47.92% 67.30% 71.70%
Net Assets, end of year (000's Omitted)......... $195,658 $266,126 $443,533 $526,335 $390,340
See notes to financial statements.
</TABLE>
THE DREYFUS THIRD CENTURY FUND, INC.
NOTES TO FINANCIAL STATEMENTS
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. The Dreyfus
Corporation ("Dreyfus") serves as the Fund's investment adviser. Tiffany
Capital Advisors, Inc. ("Tiffany") serves as the Fund's sub-investment
adviser. Dreyfus Service Corporation ("Distributor"), a wholly-owned
subsidiary of Dreyfus, acts as the exclusive distributor of the Fund's
shares, which are sold to the public without a sales charge.
Subject to shareholder approval, a new Sub-Investment Advisory Agreement
between Dreyfus and NCM Capital Management Group, Inc. will replace the
existing Sub-Investment Advisory Agreement between the Fund and Tiffany
Capital Advisors, Inc.
(A) PORTFOLIO VALUATION: Investments in securities 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. 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.
(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.
(C) AFFILIATED ISSUERS: Issuers in which the Fund held 5% or more of the
outstanding voting securities are defined as "affiliated" in the Act.
(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 taxes.
NOTE 2--INVESTMENT ADVISORY FEE, SUB-INVESTMENT ADVISORY FEE AND OTHER
TRANSACTIONS WITH AFFILIATES:
(A) Fees payable by the Fund pursuant to the provisions of an Investment
Advisory Agreement with Dreyfus and a Sub-Investment Advisory Agreement with
Tiffany (together "Agreements") are payable monthly and computed on the
average daily value of the Fund's net assets at the following annual rates:
TOTAL NET ASSETS DEYFUS TIFFANY
- ------------------- ----------- ----------
The first $200 million............................ .65 of 1% .10 of 1%
$200 up to $300 million........................... .40 of 1% .35 of 1%
In excess of $300 million......................... .375 of 1% .375 of 1%
THE DREYFUS THIRD CENTURY FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The Agreements further provide that if in any full fiscal year the
aggregate expenses of the Fund, excluding taxes, interest on borrowings,
brokerage and extraordinary expenses, exceed 1-1/2% of the average value of
the Fund's net assets, the Fund may deduct from the fees to be paid to
Dreyfus and Tiffany, or Dreyfus and Tiffany will bear, such excess, up to the
amount of their respective fees, on a pro rata basis in proportion to the
relative fees otherwise payable to each pursuant to the Agreements. There was
no expense reimbursement for the year ended May 31, 1994.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
the Distributor 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 year ended May 31, 1994, the
Fund was charged an aggregate of $990,986 pursuant to the Shareholder
Services Plan.
(C) Certain officers and directors of the Fund are "affiliated persons,"
as defined in the Act, of the Investment Adviser and/or the Distributor. Each
director who is not an "affiliated person" receives an annual fee of $10,000.
(D) On December 5, 1993, the Manager entered into an Agreement and Plan
of Merger providing for the merger of the Manager with a subsidiary of Mellon
Bank Corporation ("Mellon").
Following the merger, it is planned that the Manager will be a direct
subsidiary of Mellon Bank, N.A. Closing of this merger is subject to a number
of contingencies, including receipt of certain regulatory approvals and
approvals of stockholders of the Manager and of Mellon. The merger is
expected to occur in August 1994, but could occur later.
As a result of regulatory requirements and the terms of the Merger
Agreement, the Manager will seek various approvals from the Fund's
shareholders before completion of the merger. Proxy materials, approved by
the Fund's Board, recently have been mailed to Fund shareholders.
NOTE 3--SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities,
other than short-term securities, for the year ended May 31, 1994 amounted to
$262,921,798 and $408,714,075, respectively.
At May 31, 1994, accumulated net unrealized appreciation on investments
was $26,157,140, consisting of $33,760,529 gross unrealized appreciation and
$7,603,389 gross unrealized depreciation.
At May 31, 1994, 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 DREYFUS THIRD CENTURY FUND, INC.
REPORT OF ERNST & YOUNG, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
THE DREYFUS THIRD CENTURY FUND, INC.
We have audited the accompanying statement of assets and liabilities of
The Dreyfus Third Century Fund, Inc., including the statement of investments,
as of May 31, 1994, and the related statement of operations for the year then
ended, the statement of changes in net assets for each of the two years in
the period then ended, and financial highlights for each of the years
indicated therein. These financial statements and financial highlights are
the responsibility of the Fund's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of May 31, 1994 by correspondence with the custodian. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of The Dreyfus Third Century Fund, Inc. at May 31, 1994, the results
of its operations for the year then ended, the changes in its net assets for
each of the two years in the period then ended, and the financial highlights
for each of the indicated years, in conformity with generally accepted
accounting principles.
(Ernst & Young Signature Logo)
New York, New York
June 30, 1994
THE DREYFUS THIRD CENTURY FUND, INC.
IMPORTANT TAX INFORMATION (UNAUDITED)
For Federal tax purposes the Fund hereby designates $.450 per share as a
long-term capital gain distribution of the $.650 per share paid on December
13, 1993.
(Dreyfus Logo)
Third
Century
Fund
Annual Report
May 31, 1994
(Dreyfus Lion Logo)
(Dreyfus `D' Logo)
THE DREYFUS
THIRD CENTURY FUND, INC.
144 Glenn Curtiss Boulevard
Uniondale, NY 11556
INVESTMENT ADVISER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
SUB-INVESTMENT ADVISER
Tiffany Capital Advisors, Inc.
15 Crow Canyon Court
San Ramon, CA 94583
DISTRIBUTOR
Dreyfus Service Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
110 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. 035AR945
printed on recycled paper
Registration Mark
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN THE DREYFUS THIRD CENTURY FUND, INC. AND THE STANDARD
& POOR'S 500 COMPOSITE STOCK PRICE INDEX
EXHIBIT A:
________________________________________________________
| | STANDARD | |
| | & POOR'S 500 | THE DREYFUS |
| PERIOD | COMPOSITE STOCK | THIRD CENTURY |
| | PRICE INDEX * | FUND |
|--------- | --------------- | ---------------|
| 3/29/72 | 10,000 | 10,000 |
| 5/31/72 | 10,266 | 10,061 |
| 5/31/73 | 10,124 | 8,177 |
| 5/31/74 | 8,721 | 7,551 |
| 5/31/75 | 9,555 | 9,193 |
| 5/31/76 | 10,928 | 10,781 |
| 5/31/77 | 10,937 | 12,082 |
| 5/31/78 | 11,650 | 14,870 |
| 5/31/79 | 12,522 | 17,335 |
| 5/31/80 | 14,854 | 24,830 |
| 5/31/81 | 18,598 | 33,870 |
| 5/31/82 | 16,602 | 26,091 |
| 5/31/83 | 25,370 | 37,012 |
| 5/31/84 | 24,596 | 33,579 |
| 5/31/85 | 32,405 | 43,719 |
| 5/31/86 | 43,955 | 52,954 |
| 5/31/87 | 53,256 | 60,646 |
| 5/31/88 | 49,784 | 58,271 |
| 5/31/89 | 63,110 | 70,241 |
| 5/31/90 | 73,575 | 82,363 |
| 5/31/91 | 82,235 | 96,523 |
| 5/31/92 | 90,328 | 100,308 |
| 5/31/93 | 100,796 | 110,361 |
| 5/31/94 | 105,101 | 109,667 |
|-------------------------------------------------------|
* Source: Lipper Analytical Services, Inc.
Average Annual Total Return
- ------------------------------------------------------------------------------
Since Inception
One Year Ended Five Years Ended Ten Years Ended (3/29/72)
May 31, 1994 May 31, 1994 May 31, 1994 to May 31, 1994
- -------------- ---------------- --------------- -------------------
- -0.63% 9.32% 12.56% 11.40%
The Dreyfus Third Century Fund, Inc. May 31, 1994
Asset Allocation
|-----------------------------------------------------------
|Common Stocks 67.9 % |
|Cash Equivalents 32.1 % |
-----------------------------------------------------------
