The Dreyfus Third Century Fund, Inc. November 30, 1993
Broad Sector Allocation*
[Exhibit A]
Sector Allocations in the pie chart are broader groupings than are listed in
the Report's Statement of Investments.
Portfolio Compostion is subject to change at any time.
Asset Allocation*
Common Stock................................ 77.5%
Cash Equivalents............................ 22.5
------
100.0%
Ten Largest Holdings*
Astra A Free................................ 3.9%
Morgan (J.P.)............................... 3.0
Health Care & Retirement.................... 2.9
EMC......................................... 2.9
Merck & Co.................................. 2.7
Elan, A.D.S................................. 2.6
Intel....................................... 2.4
General Motors, Cl. E. ..................... 2.2
Sigma-Aldrich............................... 2.0
AFLAC....................................... 2.0
* As a percentage of Total Net Assets.
President's Letter
Dear Shareholder:
The Dreyfus Third Century Fund returned 1.77% for the six months ended
November 30, 1993,* underperforming the Dow Jones Industrial Average and the
Standard & Poor's 500 Composite Stock Price Index which returned 5.89% and 4.00%
respectively for the same period.**
This period also saw an important change in the Dreyfus Third Century
Fund's investment policies. On September 28, 1993, in response to the South
African Parliamentary vote and Nelson Mandela's call to remove all economic
sanctions, your Fund eliminated restrictions on investing in companies
operating in South Africa or owning 10% or more of the voting securities of
companies operating in South Africa.
It is our hope that these new investment policies will encourage
positive social change in South Africa. In addition, your Fund will now have the
opportunity to invest, subject to the Fund's normal investment criteria, in
financially promising companies which heretofore had been barred from the
portfolio because of their South African ties.
The Fund's total return continued to be impacted, during much of the
period, by poor performance of healthcare stocks, albeit with a few exceptions,
and other consumer stocks, including retailers, as well as most bank stocks.
These are stock categories that are compatible with the Fund's social goals. At
the same time, the S&P 500 and the Dow Jones Industrials have been propelled by
the heavy cyclical component inherent in their stock list. Unfortunately, many
of these cyclicals do not meet the Fund's social criteria. Some of the Fund's
holdings in the healthcare area have been recovering, but not enough to offset
the earlier underperformance.
Stocks that performed well during the first half of the Fund's fiscal
year included Intel, Oracle Systems, Micron Technology and Adaptec in the
technology sector; Singer N.V., Morton International, Magma Power and Illinois
Central in the cyclical sector; Shaw Industries, Lennar and Southwest Airlines
in the consumer area; and J.P. Morgan, Alliance Capital Management L.P., Dean
Witter, Discover & Co. and State Street Boston in the financial sector.
Most healthcare stocks were adversely affected by the uncertainties
created by healthcare reform proposals through much of the year. More recently,
investors have been able to sort out likely beneficiaries, resulting in some
significant recoveries. One example of the magnitude of this process can be seen
in the price range of Medco Containment Services, a major holding of the Fund,
in the amount of 375,000 shares. Unknowns about the possible effects of reform
drove the stock price down from 39 to 24, only to benefit from a stock and cash
purchase bid from Merck & Co., which caused the stock to rally to 40, up 67%
from the low point.
Elan Corp., a manufacturer of sustained release generic drugs, is
another example of the emotional extremes created by fears of reform. The Fund
held 320,000 shares of Elan based on the conviction that its products would help
position the company as a beneficiary of reform trends because the higher
efficacies of its unique formulations appear quite cost effective. Much like
Medco Containment Services, Elan was sold down very hard, but since has
recovered to sell at new all-time highs, ending the period at about $40 versus
the Fund's book cost of $20 per share.
The Fund has not been as fortunate in every case. For example, AMSCO
International, a provider of sterilization equipment to hospitals, was caught in
the middle of a costly start-up of several facilities to offer these services to
hospitals. Reform created many additional problems for AMSCO International - of
which the Fund held 150,000 shares - and the stock was sold at a significant
loss.
The Fund's manager anticipates further improvement in healthcare stocks
as investors formulate their latest impressions. The Fund has added Columbia
Healthcare, as well as continuing to hold its basic position in Health Care &
Retirement which stood at approximately 800,000 shares at year-end.
Currently, the Fund holds shares in approximately 100 companies with, in
the opinion of the manager, attractive appreciation potential, including some
emerging young companies. We believe that this list is well positioned to
benefit from deve loping trends and should perform significantly better, over
the long term, than the recently popular basic industry stocks. The Fund's
manager will continue to add holdings in dynamic areas, especially during
periods of valuation opportunities create d by market setbacks.
While many investors are concerned that an improving economy will bring
with it higher interest rates, the Fund's manager believes it might also bring a
somewhat better consumer environment.
We would like to thank you for your continued investment in the Fund and
encourage you to write to us with any comments or observations you may have.
Sincerely,
Howard Stein
Chairman of the
Board
January 10, 1994
New York, N.Y.
<TABLE>
<CAPTION>
** 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.
The Dreyfus Third Century Fund, Inc.
Statement of Investments November 30, 1993 (Unaudited)
Common Stocks--77.5%
Shares Value
------------ ------------
<S> <S> <C> <C>
Banking - 9.6% Banc One. ................................... 180,000 $ 6,727,500
Bank of New York. ........................... 135,000 7,492,500
First Union.................................. 150,000 6,093,750
Morgan (J.P.)................................ 215,000 15,238,125
Northern Trust............................... 70,000 2,660,000
State Street Boston.......................... 90,000 3,408,750
Wachovia..................................... 235,000 7,549,375
------------
49,170,000
------------
Basic Industries - .6% Thermo Electron..............................(a) 75,000 2,878,125
------------
Biotechnology - .2% Genetic Therapy..............................(a) 65,000 1,072,500
------------
Capital Equipment - 1.9% Cooper Industries............................ 150,000 7,593,750
Greenwich Air Services....................... 40,000 365,000
Microsoft....................................(a) 10,000 800,000
Submicron Systems............................ 125,000 734,375
------------
9,493,125
------------
Chemicals - 1.1% Morton International......................... 60,000 5,587,500
------------
Computer Equipment - .4% Convex Computer (a).......................... 420,800 2,314,400
------------
Computer Services - 3.7% General Motors, Cl. E ....................... 399,000 11,421,375
Informix.....................................(a) 424,800 7,752,600
------------
19,173,975
------------
Computer Software/Services - .7% FTP Software................................. 17,300 419,525
Gupta........................................ 11,500 163,875
IMRS.........................................(a) 70,000 1,610,000
PeopleSoft...................................(a) 4,500 127,125
Santa Cruz Operation......................... 235,400 1,471,250
------------
3,791,775
------------
Conglomerates - .3% Paramount Communications..................... 20,000 1,575,000
------------
Construction - .5% Fluor........................................ 60,000 2,542,500
------------
Consumer Cyclical - 1.0% Dollar General............................... 228,750 5,318,437
------------
Consumer Durables - .1% Cobra Golf................................... 10,500 309,750
------------
Consumer Growth Staples - .0% HealthCare COMPARE...........................(a) 10,000 215,000
------------
Consumer Staples - 1.0% Coca-Cola.................................... 120,000 5,070,000
------------
Distribution - 1.0% Graham-Field Health..........................(a) 363,000 1,633,500
Grainger (W.W.).............................. 50,000 2,925,000
------------
4,558,500
------------
Drugs - 10.5% ALZA.........................................(a) 35,000 966,875
Astra A Free................................. 1,000,000 19,773,000
Elan, A.D.S..................................(a) 320,000 13,360,000
Elan (unit)..................................(b) 20,000 600,000
Forest Laboratories, Cl. A...................(a) 90,000 4,173,750
Genelabs Technologies........................(a) 277,778 1,093,751
Merck & Co................................... 402,702 13,792,544
------------
53,759,920
------------
Electrical Equipment - .1% ANTEC........................................ 13,400 368,500
The Dreyfus Third Century Fund, Inc.
Statement of Investments (continued) November 30, 1993 (Unaudited)
Common Stocks (continued)
Shares Value
------------ ------------
Engineering - 1.6% Jacobs Engineering Group.....................(a) 335,000 $ 8,333,125
------------
Entertainment - .1% Discovery Zone............................... 14,000 325,500
------------
Finance - .9% Continental Bank............................. 65,000 1,625,000
First Interstate Bancorp..................... 55,000 3,210,625
------------
4,835,625
------------
Financial Services - 2.5% Alliance Capital Management L.P.............. 240,000 6,120,000
Dean Witter, Discover & Co................... 40,000 1,520,000
United Asset Management...................... 120,000 5,025,000
------------
12,665,000
------------
Food/Restaurant - .7% PepsiCo...................................... 85,000 3,421,250
------------
Foods - .0% Boston Chicken............................... 4,400 164,450
------------
Gold Mining - 1.0% American Barrick Resources................... 160,000 4,260,000
Engelhard.................................... 36,250 870,000
------------
5,130,000
------------
Health Care - 3.1% Health Care & Retirement.....................(a) 833,200 14,789,300
U.S. Physical Therapy........................(a) 122,500 1,301,562
------------
16,090,862
------------
Health Services - .1% WellPoint Health Networks, Cl. A............. 17,000 476,000
------------
Homebuilding - 1.3% Lennar....................................... 225,000 6,693,750
------------
Insurance - 5.4% AFLAC........................................ 375,000 10,125,000
Allmerica Property & Casualty Cos............ 54,800 3,109,900
Allstate..................................... 89,300 2,634,350
Berkley (W.R.)............................... 50,000 1,812,500
First Colony................................. 194,000 4,971,250
Life USA Holdings............................(a) 30,000 502,500
National Western Life Insurance.............. 41,500 1,919,375
Penn-America Group........................... 50,000 393,750
Phoenix Re................................... 65,000 1,950,000
------------
27,418,625
------------
Insurance/Property & Casualty - .2% Paul Revere.................................. 56,600 1,315,950
------------
Machinery - .1% Duracraft.................................... 20,000 370,000
------------
Machinery/Capital Goods - 1.2% Singer N.V................................... 159,900 5,956,275
------------
Media/Entertainment - 1.1% International Cabletel....................... 31,250 765,625
Viacom, Cl. A. ..............................(a) 95,000 4,643,125
------------
5,408,750
------------
Medical Equipment - .5% Medtronic.................................... 35,000 2,703,750
------------
Medical Services - .2% Columbia Healthcare.......................... 30,000 870,000
------------
Merchandising - 3.7% Dillard Department Stores, Cl. A............. 110,000 4,537,500
Price/Costco................................. 280,000 5,355,000
Seventh Generation. .........................(a,c,d) 57,000 307,800
Sysco........................................ 85,000 2,348,125
Wal-Mart Stores.............................. 220,000 6,297,500
------------
18,845,925
------------
The Dreyfus Third Century Fund, Inc.
Statement of Investments (continued) November 30, 1993 (Unaudited)
Common Stocks (continued)
Shares Value
------------ ------------
Metals/Miscellaneous - .2% Allegheny Ludlum............................. 50,000 $ 1,168,750
------------
Miscellaneous - .3% Acclaim Entertainment........................(a) 60,000 1,470,000
------------
Oil & Gas - .1% Cross Timbers Oil............................ 30,100 428,925
------------
Paper & Paper Related - 1.2% Bemis........................................ 120,000 2,700,000
Sonoco Products.............................. 160,000 3,420,000
------------
6,120,000
------------
Pollution Control - 1.6% BHA Group, Cl. A............................. 270,000 2,632,500
Betz Laboratories............................ 60,000 2,520,000
Vallen.......................................(a) 236,750 2,841,000
------------
7,993,500
------------
Railroads - 1.6% Illinois Central............................. 140,000 4,637,500
Union Pacific................................ 55,000 3,492,500
------------
8,130,000
------------
Real Estate/Investment Trust - .1% Chelsea GCA Realty........................... 28,000 749,000
------------
Retail/Apparel - 1.4% Consolidated Stores..........................(a) 75,000 1,584,375
Gap.......................................... 50,000 2,000,000
Gymboree..................................... 2,500 106,250
PETsMART..................................... 17,500 498,750
United Retail Group..........................(a) 195,000 2,486,250
Urban Outfitters............................. 11,000 327,250
------------
7,002,875
------------
Retail Trade/Specialty - .1% Big Entertainment............................ 65,000 430,625
------------
Specialty Chemicals - 2.2% Crompton & Knowles........................... 45,000 945,000
Sigma-Aldrich................................ 220,000 10,340,000
------------
11,285,000
------------
Storage/Warehousing - .6% Lukens....................................... 76,800 2,860,800
------------
Technology - 6.1% Adaptec......................................(a) 245,000 8,115,625
Chipcom......................................(a) 60,000 2,655,000
Intel........................................ 195,000 11,992,500
Oracle Systems...............................(a) 160,000 5,060,000
Tseng Labs................................... 275,000 3,334,375
------------
31,157,500
------------
Technology/Peripherals - 2.9% EMC..........................................(a) 460,000 14,605,000
------------
Transportaion/Airlines - 1.8% Southwest Airlines........................... 262,500 9,121,875
------------
Utilities/Telephone - .9% American Telephone & Telegraph............... 20,000 1,092,500
Southwestern Bell............................ 80,000 3,400,000
------------
4,492,500
------------
TOTAL COMMON STOCKS
(cost $329,264,211)....................... $395,240,194
============
The Dreyfus Third Century Fund, Inc.
Statement of Investments (continued) November 30, 1993 (Unaudited)
Short-Term Investments - 22.1%
Principal
Amount Value
------------ ------------
U.S. Treasury Bills - 22.1% 2.911%, 12/16/1993........................... $ 4,233,000 $ 4,227,865
2.89%, 12/23/1993............................ 42,667,000 42,591,645
2.95%, 1/6/1994.............................. 6,059,000 6,041,124
3.04%, 1/20/1994............................. 26,008,000 25,898,180
3.03%, 2/3/1994.............................. 730,000 726,068
3.081%, 2/17/1994............................ 33,767,000 33,541,607
------------
TOTAL SHORT-TERM INVESTMENTS
(cost $113,026,489)....................... $113,026,489
============
TOTAL INVESTMENTS (cost $442,290,700).................................................... 99.6% $508,266,683
====== ============
CASH AND RECEIVABLES (NET)............................................................... .4% $ 1,956,118
====== ============
NET ASSETS............................................................................... 100.0% $510,222,801
====== ============
</TABLE>
Notes to Statement of Investments:
(a) Non-income producing.
(b) Each unit consists of one share of Advanced Therapeutic Systems and one
warrant to purchase one share of Elan, A.D.S..
(c) Investment in non-controlled affilates (cost $950,000) - see Note 1(c).
(d) Security restricted as to public resale. Investments in restricted
securities, with an aggregate value of $307,800, representing
approximately .1% of net assets;
<TABLE>
<CAPTION>
Percentage of
Issuer Acquisition Date Purchase Price Net Assets Valuation*
- ------ ---------------- -------------- ---------- ---------------
<S> <C> <C> <C> <C>
Seventh Generation 9/26/90 $16.67 .1% 10% discount to
market value
- ---------------
*The valuation of this security has been determined in good faith under the direction of the Board of Directors.
</TABLE>
See independent accountants' review report and notes to financial statements.
<TABLE>
<CAPTION>
The Dreyfus Third Century Fund, Inc.
Statement of Assets and Liabilities November 30, 1993 (Unaudited)
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $442,290,700)-see statement........................................ $508,266,683
Cash............................................................................. 3,252,630
Receivable for investment securities sold........................................ 1,248,999
Dividends and interest receivable................................................ 412,822
Receivable for subscriptions to Common Stock..................................... 3,650
Prepaid expenses................................................................. 59,086
------------
513,243,870
LIABILITIES:
Due to The Dreyfus Corporation................................................... $ 208,571
Due to Tiffany Capital Advisors, Inc. ........................................... 112,737
Payable for investment securities purchased...................................... 2,408,952
Payable for Common Stock redeemed................................................ 19,458
Accrued expenses................................................................. 271,351 3,021,069
---------- ------------
NET ASSETS............................................................................... $510,222,801
============
REPRESENTED BY:
Paid-in capital.................................................................. $402,236,391
Accumulated undistributed investment income-net.................................. 2,070,184
Accumulated undistributed net realized gain on investments....................... 39,940,243
Accumulated net unrealized appreciation on investments-Note 3.................... 65,975,983
------------
NET ASSETS at value applicable to 59,098,428 outstanding shares of
Common Stock, equivalent to $8.63 per share
(150 million shares of $.33 1/3 par value authorized)............................ $510,222,801
============
</TABLE>
See independent accountants' review report and notes to financial statements.
The Dreyfus Third Century Fund, Inc.
<TABLE>
<CAPTION>
Statement of Operations six months ended November 30, 1993 (Unaudited)
<S> <C> <C>
INVESTMENT INCOME:
Income:
Cash dividends (net of $1,435 foreign taxes withheld at source).......... $2,278,180
Interest................................................................. 1,893,370
----------
Total Income..................................................... $ 4,171,550
Expenses:
Investment advisory fee-Note 2(a)........................................ 1,261,251
Sub-investment advisory fee-Note 2(a).................................... 686,251
Shareholder servicing costs-Note 2(b).................................... 803,705
Professional fees........................................................ 50,200
Custodian fees........................................................... 39,597
Directors' fees and expenses-Note 2(c)................................... 21,129
Registration fees........................................................ 19,237
Prospectus and shareholders' reports..................................... 13,967
Miscellaneous............................................................ 59,231
----------
Total Expenses................................................... 2,954,568
-----------
INVESTMENT INCOME-NET............................................ 1,216,982
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments-Note 3.......................................... 10,551,901
Net unrealized (depreciation) on investments for the period:
Unaffiliated issuers..................................................... $(2,324,806)
Affiliated issuers....................................................... (167,200) (2,492,006)
----------- -----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS.................. 8,059,895
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS..................................... $ 9,276,877
===========
</TABLE>
See independent accountants' review report and notes to financial statements.
<TABLE>
<CAPTION>
The Dreyfus Third Century Fund, Inc.
Statement of Changes in Net Assets
Year Ended Six Months Ended
May 31, November 30, 1993
1993 (Unaudited)
------------ ------------
<S> <C> <C>
OPERATIONS:
Investment income-net............................................................ $ 2,338,779 $ 1,216,982
Net realized gain on investments................................................. 34,235,279 10,551,901
Net unrealized appreciation (depreciation) on investments for the period......... 11,273,164 (2,492,006)
------------ ------------
Net Increase In Net Assets Resulting From Operations..................... 47,847,222 9,276,877
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net............................................................ (2,772,024) ---
Net realized gain on investments................................................. (3,388,031) ---
------------ ------------
Total Dividends.......................................................... (6,160,055) ---
------------ ------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold.................................................... 247,614,777 69,661,880
Dividends reinvested............................................................. 5,916,878 ---
Cost of shares redeemed.......................................................... (212,416,606) (95,050,948)
------------ ------------
Increase (Decrease) In Net Assets From Capital Stock Transactions........ 41,115,049 (25,389,068)
------------ ------------
Total Increase (Decrease) In Net Assets.......................... 82,802,216 (16,112,191)
NET ASSETS:
Beginning of period.............................................................. 443,532,776 526,334,992
------------ ------------
End of period (including undistributed investment income-net:
$853,202 and $2,070,184, respectively)................................... $526,334,992 $510,222,801
============ ============
Shares Shares
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Shares sold...................................................................... 30,554,379 8,137,439
Shares issued for dividends reinvested........................................... 709,457 ---
Shares redeemed.................................................................. (26,057,343) (11,103,373)
------------ ------------
Net Increase (Decrease) In Shares Outstanding............................ 5,206,493 (2,965,934)
============ ============
See independent accountants' review report and 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 period indicated. This information has been derived from
information provided in the Fund's financial statements.
Year Ended May 31, Six Months Ended
----------------------------------------------- November 30, 1993
PER SHARE DATA: 1989 1990 1991 1992 1993 (Unaudited)
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period............... $5.76 $6.33 $7.01 $7.79 $7.80 $8.48
----- ----- ----- ----- ----- -----
Investment Operations:
Investment income-net.............................. .29 .21 .06 .05 .04 .02
Net realized and unrealized gain on investments.... .84 .84 1.07 .26 .74 .13
----- ----- ----- ----- ----- -----
Total from Investment Operations........... 1.13 1.05 1.13 .31 .78 .15
----- ----- ----- ----- ----- -----
Distributions:
Dividends from investment income-net............... (.30) (.18) (.12) (.08) (.05) --
Dividends from net realized gain on investments.... (.26) (.19) (.23) (.22) (.05) --
----- ----- ----- ----- ----- -----
Total Distributions (.56) (.37) (.35) (.30) (.10) --
----- ----- ----- ----- ----- -----
Net asset value, end of period..................... $6.33 $7.01 $7.79 $7.80 $8.48 $8.63
===== ===== ===== ===== ===== =====
TOTAL INVESTMENT RETURN 20.54% 17.26% 17.19% 3.92% 10.02% 1.77%*
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets............ 1.04% 1.05% 1.04% 1.08% 1.11% .57%*
Ratio of net investment income to average net assets 4.71% 3.19% 1.10% .83% .48% .23%*
Portfolio Turnover Rate............................ 52.82% 162.82% 72.57% 47.92% 67.30% 24.95%*
Net Assets, end of period (000's Omitted).......... $168,579 $195,658 $266,126 $443,533 $526,335 $510,223
- ----------------
*Not Annualized.
</TABLE>
See independent accountants' review report and notes to financial statements.
The Dreyfus Third Century Fund, Inc.
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. 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.
(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 traded 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. This may result in
distributions that are in excess of net realized gains on a fiscal year
basis. 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 provisions
available to certain investment companies, as defined in applicable
sections of the Internal Revenue Code, and to make distributions of
taxable income sufficient to relieve it from all, or 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 Dreyfus 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 (Unaudited) (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 six months ended November
30, 1993.
(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
six months ended November 30, 1993, the Fund was charged an aggregate
of $509,027 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, Dreyfus entered into an Agreement and
Plan of Merger providing for the merger of Dreyfus with a subsidiary of
Mellon Bank Corporation ("Mellon").
Upon closing of the merger, it is planned that Dreyfus will retain its
New York headquarters and will be a separate subsidiary within the Mellon
organization. It is expected that the Dreyfus' management team and
mutual fund managers will remain in place, and the Dreyfus mutual funds
will be operated in the same manner as they are currently.
Following the merger, Dreyfus will be either a direct or indirect
subsidiary of Mellon, whose principal banking subsidiary is Mellon Bank,
N.A. Closing of this merger is subject to a number of contingencies,
including the receipt of certain regulatory approvals and the approvals of
the stockholders of Dreyfus and of Mellon. The merger is expected to occur
in mid-1994, but could occur significantly later.
Because the merger will constitute an "assignment" of the Fund's
Investment Advisory Agreement with Dreyfus under the Investment
Company Act of 1940, and thus a termination of such Agreement, Dreyfus
will seek prior approval from the Fund's Board and shareholders.
NOTE 3-Securities Transactions:
The following summarizes the aggregate amount of purchases and
sales of investments securities, excluding short-term securities, during
the six months ended November 30, 1993:
Purchases Sales
------------ ------------
Unaffiliated issuers.......... $99,357,460 $122,227,441
Affiliated issuers............ ---- ----
----------- ------------
$99,357,460 $122,227,441
=========== ============
At November 30, 1993, accumulated net unrealized appreciation on
investments was $65,975,983, consisting of $85,554,431 gross
unrealized appreciation and $19,578,448 gross unrealized depreciation.
At November 30, 1993, 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.
Review Report of Ernst & Young, Independent Accountants
Shareholders and Board of Directors
The Dreyfus Third Century Fund, Inc.
We have reviewed the accompanying statement of assets and
liabilities of The Dreyfus Third Century Fund, Inc., including the statement
of investments, as of November 30, 1993, and the related statements of
operations and changes in net assets and financial highlights for the six
month period ended November 30, 1993. 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 May 31, 1993 and financial highlights for each of the five years in
the period ended May 31, 1993 and in our report dated July 8, 1993, we
expressed an unqualified opinion on such statement of changes in net
assets and financial highlights.
(Ernst & Young Signature Logo)
New York, New York
January 7, 1994
(Dreyfus logo)
Third
Century
Fund
Semi-Annual
Report
November 30, 1993
(Dreyfus Lion 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.
035SA9311
Printed in U.S.A. printed on recycled paper
The Dreyfus Third Century Fund, Inc. November 30, 1993
Exhibit A:
Broad Sector Allocation*
--------------------------------------------------------
| Cash Equivalents 22.5 % |
| Financial 18.7 % |
| Consumer Growth Staples 18.4 % |
| Technology 13.8 % |
| Other 6.7 % |
| Basic Industries 6.3 % |
| Capital Goods 5.4 % |
| Consumer Cyclical 4.8 % |
| Transportation 3.4 % |
| -------------------------------------------------------- |
