The Dreyfus Premier
Third Century
Fund, Inc.
SEMIANNUAL REPORT November 30, 1999
(reg.tm)
The views expressed herein are current to the date of this report. These views
and the composition of the fund's portfolio are subject to change at any time
based on market and other conditions.
* Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value
Year 2000 Issues (Unaudited)
The fund could be adversely affected if the computer systems used by Dreyfus and
the fund's other service providers do not properly process and calculate
date-related information from and after January 1, 2000. Dreyfus has taken steps
designed to avoid year 2000-related problems in its systems and to monitor the
readiness of other service providers. In addition, issuers of securities in
which the fund invests may be adversely affected by year 2000-related problems.
This could have an impact on the value of the fund's investments and its share
price.
Contents
THE FUND
- --------------------------------------------------
2 Letter from the President
3 Discussion of Fund Performance
6 Statement of Investments
9 Statement of Assets and Liabilities
10 Statement of Operations
11 Statement of Changes in Net Assets
13 Financial Highlights
15 Notes to Financial Statements
FOR MORE INFORMATION
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Back Cover
The Fund
The Dreyfus Premier Third Century Fund, Inc.
LETTER FROM THE PRESIDENT
Dear Shareholder:
We are pleased to present this semiannual report for The Dreyfus Premier Third
Century Fund, Inc., covering the six-month period from June 1, 1999 through
November 30, 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 managers, Paul A. Hilton and Maceo K. Sloan.
When the reporting period began, the U.S. economy was showing signs of continued
strength, characterized by high levels of consumer spending and low levels of
unemployment. These conditions raised concerns among investors that inflationary
pressures might re-emerge. In response, the Federal Reserve Board raised
short-term interest rates three times during the reporting period in an effort
to forestall inflationary pressures.
Because higher interest rates tend to increase the cost of capital and make
fixed-income securities more competitive relative to equities, many sectors of
the stock market declined when the Federal Reserve Board raised interest rates.
Technology stocks, which advanced on investor speculation in high-flying
Internet companies, represented one of the few exceptions to this trend. Toward
the end of the reporting period, however, stocks representing a number of
different market sectors began to rally, as investors became optimistic that the
adverse effects of recent and impending interest-rate increases had already been
incorporated into the prices of most stocks.
We appreciate your confidence over the past six months, and we look forward to
your continued participation in The Dreyfus Premier Third Century Fund, Inc.
Sincerely,
Stephen E. Canter
President and Chief Investment Officer
The Dreyfus Corporation
December 15, 1999
DISCUSSION OF FUND PERFORMANCE
Paul A. Hilton and Maceo K. Sloan, Portfolio Managers
How did The Dreyfus Premier Third Century Fund, Inc. perform relative to its
benchmark?
For the six-month period ended November 30, 1999, The Dreyfus Premier Third
Century Fund, Inc. Class Z shares produced a total return of 15.25%.(1) In
contrast, the fund's benchmark, the Standard & Poor's 500 Composite Stock Price
Index (" S& P 500 Index" ), produced a total return of 7.36% for the same
period.(2)
The public offering of the fund's Class A, B, C, R and T shares commenced on
August 31, 1999. From August 31, 1999 to November 30, 1999 the fund achieved a
total return of 9.67% for Class A shares, 9.52% for Class B shares, 9.60% for
Class C shares, 9.82% for Class R shares, and 9.15% for Class T shares.
We are very pleased with the fund's returns and attribute our strong performance
to our emphasis on technology stocks, a market sector that performed
exceptionally well over the past six months, and an area in which we made good
choices in our individual stock selection. Our holdings in the consumer cyclical
and healthcare groups also helped drive performance.
What is the fund's investment approach?
The fund seeks to provide capital growth by investing in high quality,
growth-oriented companies that generally exhibit three characteristics:
improving profitability measurements, a pattern of consistent earnings and
reasonable prices. Current income is a secondary objective. To pursue these
goals, the fund invests primarily in the common stock of companies that, in the
opinion of the fund's management, meet traditional investment standards while
simultaneously conducting their businesses in a manner that contributes to the
enhancement of the quality of life in America.
The Fund
DISCUSSION OF FUND PERFORMANCE (CONTINUED)
What other factors influenced the fund's performance?
At the beginning of the six-month reporting period, many overseas economies were
well into recovery from last fall's economic crises. As many global economies
continued to strengthen, investors became more comfortable holding riskier
assets. At the end of the last reporting period, market sentiment moved away
from domestic large-cap growth stocks to include a broader group of companies.
However, by the end of the summer, the equity markets began to narrow again,
once again favoring large-cap growth names.
While the equity markets have recorded strong gains during the last six months,
those gains have been accompanied by heightened volatility in a rising
interest-rate environment. In fact, only a few sectors of the equity markets
performed well this past year -- most of the gains were limited to technology
stocks and, to a lesser degree, telecommunication stocks.
What is the fund's current strategy?
We continue to maintain our strategy of seeking companies that produce
consistent earnings but are reasonably priced. While we currently plan to
maintain our emphasis on technology and healthcare stocks, we have also begun to
increase our exposure to financial stocks because we believe their valuations
have become attractive. In our view, many financial companies have become adept
at maintaining their companies' growth rates in rising interest-rate
environments. We are particularly interested in companies with a large
percentage of their business in fee-based accounts, because we believe they are
best positioned to improve their earnings regardless of the direction of
interest rates.
Can you give us an update on recent activity in the field of socially
responsible investing?
In our last report, we discussed a shareholder resolution facing Home Depot, the
large home improvement retailer. The resolution was intended to stop the sale of
building products made from old-growth wood. We voted in favor of this
resolution. Subsequently, on August 26, 1999, Home Depot's President and CEO,
Arthur M. Blank, pledged to stop selling wood products from environmentally
sensitive areas and, by the end of the year 2002, to eliminate wood from
endangered areas
from all of its stores. In addition, Blank said the company was working to
ensure that the transition is completely transparent to customers and that it
will not appreciably affect pricing or product availability. We are pleased with
Home Depot' s actions, which have apparently started a trend among other home
improvement retailers. For example, HomeBase, the Irvine, CA-based chain, and
Wickes Lumber followed suit by announcing plans to stop selling wood from
endangered old growth forests. It is expected that several other home
improvement retailers will follow the lead set by these three companies
In other industry news, on November 4, 1999, the Social Investment Forum, a
nonprofit organization dedicated to promoting socially and environmentally
responsible investing, released a report stating that today more than $2
trillion is invested in the United States in a socially responsible manner. This
reflects an 82% rise from 1997 levels. However, what may be even more
significant is the rise in socially responsible assets versus the growth of
overall stock market investing. According to the report, socially responsible
assets grew at roughly TWICE the rate of all assets in the market in the U.S.,
which climbed 42% during the same time period.(3)
We are very pleased with the findings of the report and believe it clearly
illustrates that a growing number of Americans are investing their money in a
fashion that is aligned with their social and environmental values.
December 15, 1999
(1) TOTAL RETURN INCLUDES REINVESTMENT OF DIVIDENDS AND ANY CAPITAL GAINS PAID,
AND DOES NOT TAKE INTO CONSIDERATION THE MAXIMUM INITIAL SALES CHARGE IN THE
CASE OF CLASS A AND CLASS T SHARES, OR THE APPLICABLE CONTINGENT DEFERRED SALES
CHARGE IMPOSED ON REDEMPTIONS IN THE CASE OF CLASS B AND CLASS C SHARES. HAD
THESE CHARGES BEEN REFLECTED, RETURNS WOULD HAVE BEEN LOWER. ON AUGUST 31, 1999,
THE FUND ADOPTED A MULTICLASS STRUCTURE. EXISTING FUND SHARES WERE DESIGNATED AS
CLASS Z SHARES AND CLASS Z SHARES WERE CLOSED TO NEW INVESTORS. PAST PERFORMANCE
IS NO GUARANTEE OF FUTURE RESULTS. SHARE PRICE AND INVESTMENT RETURN FLUCTUATE
SUCH THAT UPON REDEMPTION FUND SHARES MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST.
(2) SOURCE: LIPPER ANALYTICAL SERVICES, INC. -- REFLECTS THE REINVESTMENT OF
INCOME DIVIDENDS AND, WHERE APPLICABLE, CAPITAL GAIN DISTRIBUTIONS. THE STANDARD
& POOR'S 500 COMPOSITE STOCK PRICE INDEX IS A WIDELY ACCEPTED, UNMANAGED INDEX
OF U.S. STOCK MARKET PERFORMANCE.
(3) INFORMATION DERIVED FROM THE SOCIAL INVESTMENT FORUM'S 1999 TRENDS REPORT.
<TABLE>
<CAPTION>
The Fund
STATEMENT OF INVESTMENTS
November 30, 1999 (Unaudited)
COMMON STOCKS--98.9% Shares Value ($)
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COMMERCIAL SERVICES--.9%
<S> <C> <C>
Omnicom Group 139,000 12,249,375
CONSUMER NON-DURABLES--7.6%
Clorox 348,200 15,516,663
Coca-Cola 355,200 23,909,400
Kimberly-Clark 226,000 14,435,750
Procter & Gamble 414,900 44,809,200
98,671,013
CONSUMER SERVICES--2.5%
Gannett 210,000 15,028,125
Time Warner 291,600 17,988,075
33,016,200
ELECTRONIC TECHNOLOGY--21.6%
Cisco Systems 617,100 (a) 55,037,606
Cree Research 199,200 (a) 11,379,300
EMC 262,000 (a) 21,893,375
Intel 215,000 16,487,813
International Business Machines 193,700 19,963,206
Linear Technology 222,400 15,804,300
Lucent Technologies 426,000 31,124,625
Nokia, A.D.S. 107,600 14,868,975
Sanmina 68,000 (a) 6,536,500
Solectron 210,000 (a) 17,298,750
Sun Microsystems 327,600 (a) 43,325,100
Tellabs 373,700 (a) 24,243,788
277,963,338
ENERGY MINERALS--1.4%
BP Amoco, A.D.R. 294,600 17,952,187
FINANCE--16.7%
AFLAC 330,000 15,798,750
American Express 155,900 23,589,619
American International Group 308,062 31,807,401
Capital One Financial 175,600 8,176,375
Citigroup 397,050 21,391,069
Fannie Mae 565,700 37,689,763
Marsh & McLennan Cos. 236,600 18,602,675
Merrill Lynch 310,000 24,993,750
COMMON STOCKS (CONTINUED) Shares Value ($)
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FINANCE (CONTINUED)
Providian Financial 205,000 16,220,625
State Street 227,100 16,677,656
214,947,683
HEALTH SERVICES--.6%
Cardinal Health 151,000 7,899,187
HEALTH TECHNOLOGY--13.4%
Amgen 414,400 (a) 18,881,100
Guidant 332,000 16,600,000
Johnson & Johnson 192,000 19,920,000
Lilly (Eli) & Co. 221,700 15,906,975
Merck & Co. 574,000 45,059,000
Pfizer 663,500 24,010,406
Schering-Plough 622,500 31,825,313
172,202,794
PROCESS INDUSTRIES--1.8%
Avery Dennison 267,400 15,876,875
Ecolab 198,000 6,855,750
22,732,625
PRODUCER MANUFACTURING--4.0%
Illinois Tool Works 139,400 9,026,150
Miller (Herman) 275,000 6,290,625
Minnesota Mining & Manufacturing 189,600 18,118,650
Pitney Bowes 378,400 18,139,550
51,574,975
RETAIL TRADE--7.6%
CVS 324,000 12,858,750
Dollar General 148,700 3,643,150
Gap 382,100 15,475,050
Home Depot 307,500 24,311,719
Safeway 310,600 (a) 11,453,375
TJX Cos. 360,000 9,427,500
Wal-Mart Stores 353,600 20,376,200
97,545,744
TECHNOLOGY SERVICES--12.5%
America Online 212,400 (a) 15,438,825
BMC Software 333,400 (a) 24,275,688
The Fund
STATEMENT OF INVESTMENTS (CONTINUED)
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
COMMON STOCKS (CONTINUED) Shares Value ($)
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TECHNOLOGY SERVICES (CONTINUED)
Compuware 400,000 (a) 13,525,000
First Data 348,500 15,072,625
Microsoft 614,600 (a) 55,957,409
Oracle 536,000 (a) 36,347,500
160,617,047
UTILITIES--8.3%
AES 203,300 (a) 11,778,694
ALLTEL 153,000 13,234,500
AT&T--Liberty Media Group, Cl. A 390,000 (a) 16,306,875
MCI WorldCom 345,897 (a) 28,601,358
SBC Communications 252,540 13,116,296
Vodafone AirTouch, A.D.R. 507,750 23,959,453
106,997,176
TOTAL COMMON STOCKS
(cost $831,916,715) 1,274,369,344
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Principal
SHORT-TERM INVESTMENTS-1.7% Amount ($) Value ($)
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CERTIFICATES OF DEPOSIT--.0%
Self Help Credit Union,
4.79%, 12/20/1999 100,000 100,000
U.S.TREASURY BILLS--1.7%
4.49%, 12/9/1999 457,000 456,552
4.48%, 12/23/1999 149,000 148,627
5.15%, 1/20/2000 14,506,000 14,401,557
5.05%, 2/10/2000 6,586,000 6,520,272
21,527,008
TOTAL SHORT-TERM INVESTMENTS
(cost $21,627,693) 21,627,008
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TOTAL INVESTMENTS (cost $853,544,408) 100.6% 1,295,996,352
LIABILITIES, LESS CASH AND RECEIVABLES (.6%) (8,113,611)
NET ASSETS 100.0% 1,287,882,741
A NON-INCOME PRODUCING.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
STATEMENT OF ASSETS AND LIABILITIES
November 30, 1999 (Unaudited)
Cost Value
- --------------------------------------------------------------------------------
ASSETS ($):
Investments in securities--See Statement of
Investments 853,544,408 1,295,996,352
Receivable for investment securities sold 29,758,929
Dividends and interest receivable 767,325
Receivable for shares of Common Stock subscribed 432,969
Prepaid expenses 125,164
1,327,080,739
- -------------------------------------------------------------------------------
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 973,154
Due to Distributor 2,240
Cash overdraft due to Custodian 106,310
Payable for investment securities purchased 23,467,843
Payable for shares of Common Stock redeemed 14,509,040
Accrued expenses 139,411
39,197,998
- --------------------------------------------------------------------------------
NET ASSETS ($) 1,287,882,741
- -------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS ($):
Paid-in capital 716,513,554
Accumulated investment (loss) (927,884)
Accumulated net realized gain (loss) on investments 129,845,127
Accumulated net unrealized appreciation (depreciation)
on investments--Note 4 442,451,944
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NET ASSETS ($) 1,287,882,741
<TABLE>
<CAPTION>
NET ASSET VALUE PER SHARE
Class A Class B Class C Class R Class T Class Z
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS ($) 1,521,155 2,111,250 1,114,232 39,815 1,042 1,283,095,247
Shares Outstanding 104,003 144,484 76,224 2,718 71.582 87,538,433
- -------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE
PER SHARE ($) 14.63 14.61 14.62 14.65 14.56 14.66
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
STATEMENT OF OPERATIONS
Six Months Ended November 30, 1999 (Unaudited)
- -------------------------------------------------------------------------------
INVESTMENT INCOME ($):
INCOME:
Cash dividends 4,203,375
Interest 373,245
TOTAL INCOME 4,576,620
EXPENSES:
Investment advisory fee--Note 3(a) 4,518,959
Shareholder servicing costs--Note 3(c) 844,929
Prospectus and shareholders' reports 92,577
Custodian fees-Note 3(c) 42,489
Registration fees 31,268
Professional fees 19,721
Directors' fees and expenses--Note 3(d) 18,014
Interest expense--Note 2 9,612
Loan commitment fees--Note 2 7,366
Distribution fees--Note 3(b) 2,380
Miscellaneous 2,195
TOTAL EXPENSES 5,589,510
INVESTMENT (LOSS) (1,012,890)
- -------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):
Net realized gain (loss) on investments 27,922,084
Net unrealized appreciation (depreciation) on investments 144,061,336
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 171,983,420
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 170,970,530
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
November 30, 1999 Year Ended
(Unaudited)a May 31, 1999
- -------------------------------------------------------------------------------
OPERATIONS ($):
Investment (loss) (1,012,890) (1,067,941)
Net realized gain (loss) on investments 27,922,084 114,693,454
Net unrealized appreciation (depreciation)
on investments 144,061,336 66,921,091
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS 170,970,530 180,546,604
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DIVIDENDS TO SHAREHOLDERS FROM ($):
NET REALIZED GAIN ON INVESTMENTS: -- (105,500,411)
- -------------------------------------------------------------------------------
CAPITAL STOCK TRANSACTIONS ($):
Net proceeds from shares sold:
Class A shares 1,458,134 --
Class B shares 2,030,215 --
Class C shares 1,041,773 --
Class R shares 41,711 --
Class T shares 955 --
Class Z shares 268,606,045 731,491,242
Dividends reinvested:
Class Z shares -- 100,555,806
Cost of shares redeemed:
Class A shares (3,508) --
Class B shares (1,329) --
Class C shares (468) --
Class R shares (6,362) --
Class Z shares (286,444,908) (688,590,998)
INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL STOCK TRANSACTIONS (13,277,742) 143,456,050
TOTAL INCREASE (DECREASE) IN NET ASSETS 157,692,788 218,502,243
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NET ASSETS ($):
Beginning of Period 1,130,189,953 911,687,710
END OF PERIOD 1,287,882,741 1,130,189,953
Undistributed investment income (loss)--net (927,884) 85,006
A THE FUND CHANGED TO A SIX CLASS FUND ON AUGUST 31, 1999. THE EXISTING SHARES
WERE REDESIGNATED CLASS Z SHARES.
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
STATEMENT OF CHANGES IN NET ASSETS (Unaudited) (CONTINUED)
Six Months Ended
November 30, 1999 Year Ended
(Unaudited)a May 31, 1999
- -------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:
CLASS A
Shares sold 104,203 --
Shares redeemed (200) --
NET INCREASE (DECREASE) IN SHARES OUTSTANDING 104,003 --
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CLASS B
Shares sold 144,563 --
Shares redeemed (79) --
NET INCREASE (DECREASE) IN SHARES OUTSTANDING 144,484 --
- -------------------------------------------------------------------------------
CLASS C
Shares sold 76,255 --
Shares redeemed (31) --
NET INCREASE (DECREASE) IN SHARES OUTSTANDING 76,224 --
- -------------------------------------------------------------------------------
CLASS R
Shares sold 3,153 --
Shares redeemed (435) --
NET INCREASE (DECREASE) IN SHARES OUTSTANDING 2,718 --
- -------------------------------------------------------------------------------
CLASS T
SHARES SOLD 72 --
- -------------------------------------------------------------------------------
CLASS Z
Shares sold 19,653,415 59,336,041
Shares issued for dividends reinvested -- 8,565,231
Shares redeemed (20,969,962) (56,431,517)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING (1,316,547) 11,469,755
A THE FUND CHANGED TO A SIX CLASS FUND ON AUGUST 31, 1999. THE EXISTING SHARES
WERE REDESIGNATED CLASS Z SHARES.
SEE NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following table describes the performance for each share class for the
fiscal periods indicated. All information (excluding portfolio turnover rate)
reflects financial results for a single fund share. 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.
Period Ended November 30, 1999 (Unaudited)(a)
-------------------------------------------------------------------
Class A Class B Class C Class R Class T
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PER SHARE DATA ($):
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period 13.34 13.34 13.34 13.34 13.34
Investment Operations:
Investment income (loss)--net (b) (.02) (.04) (.04) (.01) (.09)
Net realized and unrealized gain (loss)
on investments 1.31 1.31 1.32 1.32 1.31
Total from Investment Operations 1.29 1.27 1.28 1.31 1.22
Net asset value, end of period 14.63 14.61 14.62 14.65 14.56
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) (C) 9.67(d) 9.52(d) 9.60(d) 9.82 9.15(d)
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RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to average net assets (c) .36 .55 .53 .29 .89
Ratio of net investment income (loss)
to average net assets (c) (.15) (.34) (.32) (.09) (.70)
Portfolio Turnover Rate (c) 31.91 31.91 31.91 31.91 31.91
- -----------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period ($ X 1,000) 1,521 2,111 1,114 40 1
(a) From August 31, 1999 (commencement of initial offering) to November 30,
1999.
(b) Based on average shares outstanding at each month end.
(c) Not annualized.
(d) Exclusive of sales charge.
See notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
The Fund
FINANCIAL HIGHLIGHTS (CONTINUED)
Six Months Ended
November 30, 1999a Year Ended May 31,
-------------------------------------------------------------
Class Z (Unaudited) 1999 1998 1997 1996 1995
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PER SHARE DATA ($):
Net asset value, beginning
<S> <C> <C> <C> <C> <C> <C>
of period 12.72 11.78 10.01 9.25 7.45 7.80
Investment Operations:
Investment income (loss)-net (.01)(b) (.01) .01 .02 .03 .07
Net realized and unrealized
gain (loss) on investments 1.95 2.29 2.68 2.16 2.39 .65
Total from Investment Operations 1.94 2.28 2.69 2.18 2.42 .72
Distributions:
Dividends from investment
income-net -- -- (.02) (.02) (.05) (.07)
Dividends from net realized
gain on investments -- (1.34) (.90) (1.40) (.57) (1.00)
Total Distributions -- (1.34) (.92) (1.42) (.62) (1.07)
Net asset value, end of period 14.66 12.72 11.78 10.01 9.25 7.45
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) 15.25(c) 20.30 27.76 25.70 33.63 11.81
- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to average
net assets .46(c) .96 .97 1.03 1.11 1.12
Ratio of net investment
income (loss) to average
net assets (.08)(c) (.11) .07 .22 .36 .93
Portfolio Turnover Rate 31.91(c) 75.88 70.41 66.52 92.08 133.54
- -----------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ X 1,000) 1,283,095 1,130,190 911,688 677,084 473,452 368,833
A THE FUND CHANGED TO A SIX CLASS FUND ON AUGUST 31, 1999. THE EXISTING SHARES WERE REDESIGNATED CLASS Z SHARES.
B BASED ON AVERAGE SHARES OUTSTANDING AT EACH MONTH END.
C NOT ANNUALIZED.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Significant Accounting Policies:
The Dreyfus Premier Third Century 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 capital growth. The Dreyfus Corporation ("Dreyfus") serves as the fund's
investment adviser. Dreyfus is a direct subsidiary of Mellon Bank, N.A., which
is a wholly-owned subsidiary of Mellon Financial Corporation. NCM Capital
Management Group, Inc. (" NCM" ) serves as the fund's sub-investment adviser.
Premier Mutual Fund Services, Inc. is the distributor of the fund's shares.
On April 15, 1999, shareholders approved a reorganization, effective August 31,
1999, in which the fund' s name changed to The Dreyfus Premier Third Century
Fund, Inc. Shares of the fund have been redesignated as Class Z shares and the
fund added Class A, Class B, Class C, Class R and Class T shares.
The fund is authorized to issue 650 million of $.001 par value Capital Stock.
The fund currently offers six classes of shares: Class A (100 million shares
authorized) , Class B (100 million shares authorized), Class C (100 million
shares authorized) , Class R (100 million shares authorized), Class T (100
million shares authorized) and Class Z (150 million shares authorized). Class A,
Class B, Class C, Class T and Class Z shares are sold primarily to retail
investors through financial intermediaries and bear a distribution fee and/or
service fee. Class Z shares are not available for new accounts. Class A shares
and Class T shares are subject to a sales charge imposed at the time of
purchase. Class B shares are subject to a contingent deferred sales charge
("CDSC") imposed on Class B share redemptions made within six years of purchase,
Class C shares are subject to a CDSC imposed on Class C shares redeemed within
one year of purchase and Class R shares are sold at net asset value per share
only to institutional investors. Other differences between the classes include
the services offered to and the expenses borne by each class and certain voting
rights.
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
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 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.
(b) Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Dividend income is
recognized on the ex-dividend date and interest income, including, where
applicable, amortization of discount on investments, is recognized on the
accrual basis. Under the terms of the custody agreement, the fund received net
earnings credits during the period ended November 30, 1999.
(c) 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.
(d) Federal income taxes: It is the policy of the fund to continue to qualify as
a regulated investment company, if such qualification is in the best interests
of its shareholders, by complying with the applicable provisions of the Code,
and to make distributions of taxable income sufficient to relieve it from
substantially all Federal income and excise taxes.
NOTE 2--Bank Line of Credit:
The fund participates with other Dreyfus-managed funds in a $500 million
redemption credit facility (the "Facility" ) primarily to be utilized for
temporary or emergency purposes, including the financing of 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 rate in effect at the time of borrowings.
The average daily amount of borrowings outstanding during the period ended
November 30, 1999, was approximately $350,300 with a related weighted average
annualized interest rate of 5.49%.
NOTE 3--Investment Advisory Fee, Sub-Investment Advisory Fee and Other
Transactions With Affiliates:
(a) Pursuant to the investment advisory agreement ("Agreement") with Dreyfus,
the investment advisory fee is computed at an annual rate of .75 of 1% of the
value of the fund's average daily net assets and is payable monthly. Pursuant to
an undertaking if in any full fiscal year the aggregate expenses allocable to
Class Z, exclusive of taxes, brokerage, interest on borrowings, commitment fees
and extraordinary expenses, exceed 11_2% of the average value of Class Z net
assets, the fund may deduct from the fees paid to Dreyfus, or Dreyfus will bear,
such excess expense. There was no expense reimbursement during the period ended
November 30, 1999.
Pursuant to a Sub-Investment Advisory Agreement with NCM, the sub-investment
advisory fees are payable monthly by Dreyfus, and are based upon the value of
the fund's average daily net assets, computed at the following rates:
Average Net Assets
0 to $400 million . . . . . . . . . . . . . . . . . . ..10 of 1%
$400 million to $500 million . . . . . . . . . . . . . ..15 of 1%
$500 million to $750 million . . . . . . . . . . . . . ..20 of 1%
In excess of $750 million . . . . . . . . . . . . . . ..25 of 1%
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager, retained
$851 during the period ended November 30, 1999 from commissions earned on sales
of the fund's shares.
(b) Under the Distribution Plan (the "Plan") adopted pursuant to Rule 12b-1
under the Act, Class B, Class C and Class T shares pay the Distributor for
distributing their shares at the following annual rates: .75 of 1% of the value
of the average daily net assets of Class B and Class C shares and .25 of 1% of
the value of the average daily net assets of Class T shares. During the period
ended November 30, 1999, Class B, Class C and Class T shares were charged
$1,459, $920 and $1, respectively, pursuant to the Plan.
(c) Under the Shareholder Services Plan, Class A, Class B, Class C and Class T
shares pay the Distributor at an annual rate of .25 of 1% of the value of their
average daily net assets for the provision of certain services. The services
provided may include personal services relating to shareholder accounts, such as
answering shareholder inquiries regarding Class A, Class B, Class C and Class T
shares and providing reports and other information, and services related to the
maintenance of shareholder accounts. The Distributor may make payments to
Service Agents (a securities dealer, financial institution or other industry
professional) in respect of these services. The Distributor determines the
amounts to be paid to Service Agents. During the period ended November 30, 1999,
Class A, Class B, Class C and Class T shares were charged $334, $486, $307 and
$1, respectively, pursuant to the Shareholder Services Plan.
Under the Shareholder Services Plan, Class Z shares reimburses Dreyfus Service
Corporation, an amount not to exceed an annual rate of .25 of 1% of the value of
the average daily net assets of Class Z shares for certain allocated expenses of
providing personal services and/or maintaining shareholder accounts. The
services provided may include personal services relating to Class Z shareholder
accounts, such as answering shareholder inquiries and providing reports and
other information, and services related to the maintenance of shareholder
accounts. During the period ended November 30, 1999, Class Z shares was charged
$484,634, pursuant to the Shareholder Services Plan.
The fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
Dreyfus, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the fund. During the period
ended November 30, 1999, the fund was charged $135,976 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 November 30, 1999, the fund was
charged $42,489 pursuant to the custody agreement.
(d) Each director who is not an "affiliated person" as defined in the Act
receives from the fund an annual fee of $10,000. The Chairman of the Board
receives an additional 25% of such compensation.
(e) During the period ended November 30, 1999, the fund incurred total brokerage
commissions of $628,749, of which $12,580 was paid to Dreyfus Brokerage
Services, a wholly-owned subsidiary of Mellon Financial Corporation.
NOTE 4--Securities Transactions:
The aggregate amount of purchases and sales of investment securities, excluding
short-term securities, during the period ended November 30, 1999, amounted to
$404,732,764 and $376,760,273, respectively.
At November 30, 1999, accumulated net unrealized appreciation on investments was
$442,451,944, consisting of $457,562,345 gross unrealized appreciation and
$15,110,401 gross unrealized depreciation.
At November 30, 1999, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
The Fund
NOTES
For More Information
The Dreyfus Premier Third Century Fund, Inc.
200 Park Avenue
New York, NY 10166
Investment Advisor
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Sub-Investment Adviser
NCM Capital Management Group, Inc.
103 West Main Street
Durham, North Carolina 27705
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 your financial representative or 1-800-554-4611
BY MAIL Write to: The Dreyfus Premier Family of Funds 144 Glenn Curtiss
Boulevard Uniondale, NY 11556-0144
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(c) 2000 Dreyfus Service Corporation 035SA9911
