--------------------------------
Semiannual Report April 30, 1998
--------------------------------
OPPENHEIMER
Quest Value
Fund, Inc.
[GRAPHIC OMITTED]
[LOGO]
OppenheimerFunds(SM)
THE RIGHT WAY TO INVEST
<PAGE>
Contents
3 President's Letter
4 Fund Performance
6 An Interview
with the Fund's
Manager
11 Statement of
Investments
14 Statement of
Assets and
Liabilities
16 Statement of
Operations
17 Statements of
Changes in
Net Assets
18 Financial Highlights
22 Notes to Financial
Statements
27 Officers and
Directors
28 Information and
Services
Report highlights
- --------------------------------------------------------------------------------
o 4-star Morningstar ranking: The Fund's Class A shares were ranked 4 stars
overall by Morningstar for the combined 3-, 5- and 10-year periods ended March
31, 1998, among 2,437 (3-year), 1,363 (5-year) and 698 (10-year) domestic equity
funds.(1)
o We found values in the stocks of what we believe are well- managed companies
that were unduly punished in the aftermath of the financial crisis in Asia.
- -------------------------------------
Cumulative Total Returns
- -------------------------------------
For the 6-Month Period
Ended 4/30/98
Class A
Without With
Sales Chg.(2) Sales Chg.(3)
- -------------------------------------
17.86% 11.08%
- -------------------------------------
Class B
Without With
Sales Chg.(2) Sales Chg.(3)
- -------------------------------------
17.58% 12.58%
- -------------------------------------
Class C
Without With
Sales Chg.(2) Sales Chg.(3)
- -------------------------------------
17.57% 16.57%
- -------------------------------------
Class Y
Without With
Sales Chg.(2) Sales Chg.(3)
- -------------------------------------
18.09% 18.09%
- -------------------------------------
Total returns include changes in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
In reviewing performance and rankings, please remember that past performance
does not guarantee future results. Investment return and principal value of an
investment in the Fund will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than the original cost.
(1). Source: Morningstar, Inc. 3/31/98. Morningstar, Inc. ranks mutual funds in
broad investment classes, based on risk-adjusted returns after considering sales
charges and expenses. Return and risk are measured as performance above and
below the 90-day U.S. Treasury bill returns, respectively. Overall star ranking
is subject to change monthly. Top 10% are ranked 5 stars, next 22.5% are 4
stars, middle 35% are 3 stars, next 22.5% are 2 stars and bottom 10% are 1 star.
The Fund's Class A shares were ranked 4 stars (3-year), 4 stars (5-year) and 4
stars (10-year) weighted 20%/30%/50%, respectively.
(2). Includes changes in net asset value per share without deducting any sales
charges. This performance is not annualized.
(3). Class A return includes the current maximum initial sales charge of 5.75%.
Class B return includes the applicable contingent deferred sales charge of 5%.
Class C return includes the applicable contingent deferred sales charge of 1%.
Class Y shares were first publicly offered on 12/16/96 and are not available for
sale to individual shareholders. An explanation of the different performance
calculations is in the Fund's prospectus. Class B and C shares are subject to an
annual 0.75% asset-based sales charge and Class A shares are subject to an
annual 0.25% asset-based sales charge. This performance is not annualized.
OppenheimerFunds, Inc. became the Fund's advisor on 11/22/95. The Fund's
subadvisor is OpCap Advisors, which was the Fund's advisor prior to 11/22/95.
The portfolio manager is employed by the Fund's subadvisor.
2 Oppenheimer Quest Value Fund, Inc.
<PAGE>
Dear shareholder,
- --------------------------------------------------------------------------------
[PHOTO]
Bridget A. Macaskill
President
Oppenheimer
Quest Value Fund, Inc.
As we move further into 1998, we remain impressed by the remarkable resilience
of the financial markets. Recent efforts by the United States to help support
the Japanese Yen have inspired hope that the fallout of the Asian economic
crisis can be contained. In general, the U.S. and world markets have continued
to build wealth for investors at a virtually unprecedented pace.
At OppenheimerFunds, we are pleased to help our fund shareholders
participate in the potential rewards of today's markets, but we also recognize
that this rate of growth cannot last forever. Because no one can predict exactly
when the next correction or bear market might occur, we think it is prudent to
continually identify, evaluate and manage the risks that may affect our fund
shareholders.
We believe that one of the leading risks facing investors today is that
stock valuations are at the high end of their his torical range, while U.S.
corporate earnings growth is slowing. Given these facts, we believe it is
unlikely that stocks will sustain the growth rate of the past three years. Stock
prices could continue trading near current levels until earnings "catch up," or
there could be a market correction. However, we believe that either scenario
would be only a temporary pause on the way to potentially greater long-term
gains.
We are also examining the potential economic effects of the "millennium
problem" that may render many computer systems unable to recognize the year 2000
when it arrives. Solving this problem has required companies to divert sub
stantial human and financial resources from their core businesses, possibly
constraining global economic growth during 1999 and 2000.
For our part, we can report that OppenheimerFunds has made solid progress
toward ensuring that our shareholder accounting systems are fully "year 2000
compliant," and that all shareholder accounts will make a seamless transition
into the 21st century.
We encourage you to meet with your financial advisor to discuss how a
possible market correction or the millennium problem may affect your
investments. Together, you can prepare your investment portfolio for the
challenges and opportunities of the new century.
Sincerely,
/s/ Bridget A. Macaskill
Bridget A. Macaskill
May 21, 1998
3 Oppenheimer Quest Value Fund, Inc.
<PAGE>
Performance update
- --------------------------------------------------------------------------------
- ------------------------------
Avg Annual Total Returns
- ------------------------------
For the Periods Ended 3/31/98(1)
Class A
1 year 5 year 10 year
- ------------------------------
31.60% 19.14% 16.36%
- ------------------------------
Class B
Since
1 year 5 year Inception
- ------------------------------
33.92% N/A 20.48%
- ------------------------------
Class C
Since
1 year 5 year Inception
- ------------------------------
38.00% N/A 20.70%
- ------------------------------
Class Y
Since
1 year 5 year Inception
- ------------------------------
40.17% N/A 33.40%
- ------------------------------
- ------------------------------
Cumulative Total Return
- ------------------------------
For the Period Ended 3/31/98(1)
Class A
5 year
- ------------------------------
140.09% $24,009(4)
- ------------------------------
Oppenheimer Quest Value Fund, Inc. Class A shares provided a cumulative total
return, without sales charges, of 17.86% for the six-month period ended April
30, 1998.(2) In addition, the Fund's Class A shares were ranked 4 stars overall
by Morningstar for the combined 3-, 5- and 10-year periods ended March 31, 1998,
among 2,437 (3-year), 1,363 (5-year) and 698 (10-year) domestic equity funds.(3)
Growth of $10,000
Over five years(4)
(without sales charges)
[The following table was originally a mountain graph in the printed materials.]
Oppenheimer
Quest Value Fund, Inc.
Class A shares S&P 500 Index
- --------------------------------------------------------------------------------
3/93 10000.0 10000.0
- --------------------------------------------------------------------------------
6/93 10149.1 10048.7
- --------------------------------------------------------------------------------
9/93 10372.9 10308.3
- --------------------------------------------------------------------------------
12/93 10391.4 10547.3
- --------------------------------------------------------------------------------
3/94 10132.1 10147.4
- --------------------------------------------------------------------------------
6/94 10287.7 10190.1
- --------------------------------------------------------------------------------
9/94 10737.3 10688.4
- --------------------------------------------------------------------------------
12/94 10479.9 10686.7
- --------------------------------------------------------------------------------
3/95 11640.2 11727.2
- --------------------------------------------------------------------------------
6/95 12847.3 12846.7
- --------------------------------------------------------------------------------
9/95 13923.3 13867.6
- --------------------------------------------------------------------------------
12/95 14369.0 14702.5
- --------------------------------------------------------------------------------
3/96 15658.8 15491.7
- --------------------------------------------------------------------------------
6/96 16122.4 16186.9
- --------------------------------------------------------------------------------
9/96 16999.0 16687.1
- --------------------------------------------------------------------------------
12/96 18042.6 18078.2
- --------------------------------------------------------------------------------
3/97 18213.2 18562.8
- --------------------------------------------------------------------------------
6/97 20678.0 21803.5
- --------------------------------------------------------------------------------
9/97 22171.8 23436.8
- --------------------------------------------------------------------------------
12/97 22823.4 24107.7
- --------------------------------------------------------------------------------
3/98 25474.0 27472.8
- --------------------------------------------------------------------------------
(1). Total returns include changes in share price and reinvestment of dividends
and capital gains distributions in a hypothetical investment for the periods
shown. Class A returns include the current maximum initial sales charge of
5.75%. Class A shares were first publicly offered on 4/30/80. The Fund's maximum
sales charge for Class A shares was lower prior to 11/24/95, so actual
performance may have been higher. Class B returns include the applicable
contingent deferred sales charge of 5% (1-year) and 2% (since inception on
9/1/93). Class C returns for the one-year result include the contingent deferred
sales charge of 1%. Class C shares have an inception date of 9/1/93. Class Y
shares were first publicly offered on 12/16/96 and are not available for sale to
individual shareholders. An explanation of the different performance
calculations is in the Fund's prospectus. Class B and C shares are subject to an
annual 0.75% asset-based sales charge and Class A shares are subject to an
annual 0.25% asset-based sales charge.
(2). Includes changes in net asset value per share without deducting any sales
charges. Such performance is not annualized and would have been lower if sales
charges were taken into account.
4 Oppenheimer Quest Value Fund, Inc.
<PAGE>
Portfolio review
- --------------------------------------------------------------------------------
Oppenheimer Quest Value Fund, Inc. is for investors looking for capital
appreciation.
Asset Allocation(5)
[The following table was originally a pie chart in the printed materials.]
o Equities 85.9%
o Cash Equivalents 14.1
What We Look For
o Quality established businesses.
o Management motivated to work for shareholders.
o Companies believed to be undervalued.
o High return on capital vs. high growth.
Top 10 Stock Holdings(5)
- --------------------------------------------------------------------------------
ACE Ltd. 5.6% May Department Stores Cos. 2.6%
- --------------------------------------------------------------------------------
EXEL Ltd. 5.3 General Re Corp. 2.5
- --------------------------------------------------------------------------------
Lockheed Martin Corp. 4.0 Everest Reinsurance
Holdings, Inc. 2.4
- --------------------------------------------------------------------------------
Green Tree Financial Corp. 4.0 Textron, Inc. 2.4
- --------------------------------------------------------------------------------
McDonald's Corp. 2.6 Tenet Healthcare Corp. 2.4
- --------------------------------------------------------------------------------
Top 5 Industries(5)
- --------------------------------------------------------------------------------
Insurance 19.4%
- --------------------------------------------------------------------------------
Manufacturing 11.0
- --------------------------------------------------------------------------------
Diversified Financials 8.3
- --------------------------------------------------------------------------------
Leisure & Entertainment 6.4
- --------------------------------------------------------------------------------
Banks 5.4
- --------------------------------------------------------------------------------
(3). Source: Morningstar, Inc. 3/31/98. The Fund's Class A shares were ranked 4
stars (3-year), 4 stars (5-year) and 4 stars (10-year) weighted 20%/30%/50%,
respectively.
(4). Results of a hypothetical $10,000 investment in Class A shares on March 31,
1993. The S&P 500 Index is a broad-based unmanaged stock index including daily
reinvestment of dividends, and cannot be purchased directly by investors. Past
performance does not guarantee future results.
(5). Portfolio is subject to change. Percentages are as of April 30, 1998, and
are based on total market value of investments.
5 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
"We're pleased that we've participated in much of the stock market's gains."
An interview with your Fund's manager
- --------------------------------------------------------------------------------
How has the Fund performed during the six-month period ended April 30, 1998?
We are pleased with the Fund's performance in this somewhat volatile market.
More specifically, Oppenheimer Quest Value Fund, Inc. Class A shares provided a
cumulative total return, without sales charges, of 17.86% for the six-month
period ended April 30, 1998.(1)
How did the Asian financial crisis, which occurred last October, affect the
Fund?
Although some of the stocks in the portfolio were indirectly affected by Asia's
financial problems, we believe that the overall effect has been positive for the
Fund. That's because the crisis provided some attractive opportunities to buy
stocks inexpensively. These purchases included large, well-managed U.S.
companies whose stocks, in our opinion, were unduly punished in the crisis's
aftermath. Most of these companies' stock prices have rebounded nicely since we
invested in them.
Did the Fund's composition change significantly over the past six months?
Not significantly. It's important to understand that, unlike some stock funds,
we don't allocate assets to achieve a predetermined balance among industries or
market sectors. Instead, we take a "bottom-up" approach in which we look at
individual companies one by one. We buy stocks that we believe meet our
stringent criteria for growth and value, regardless of their industry
affiliations.
(1). Includes changes in net asset value per share without deducting any sales
charges. Such performance is not annualized and would have been lower if sales
charges were taken into account.
6 Oppenheimer Quest Value Fund, Inc.
<PAGE>
[PHOTO]
Portfolio Manager
Eileen Rominger
However, our bottom-up approach sometimes leads to a concentration of assets in
specific industries. Over the past three years or so, the fund has had
significant holdings in the financial industry. Our investments in this market
sector have included a very diverse, even eclectic, group of companies. For
example, insurance companies comprised a significant part of the portfolio
during the reporting period. While these stocks have performed extremely well
individually, the insurance industry as a whole has produced lackluster
performance. We think this is evidence that our bottom-up approach to investing
is working.
What individual stocks contributed most to the Fund's performance over the past
six months?
Two of our insurance stocks, ACE Ltd. and EXEL Ltd., continued to produce
outstanding gains. Both companies are fast-growing and have the lowest cost
structures in their respective markets.
In addition, we've enjoyed strong performance from Carnival Corp. Carnival
Corp. has the largest market share in the cruise line industry and is also the
most efficient. Carnival reinvests its profits in the business and keeps its
ships extremely fresh and contemporary, which is very appealing to customers.
What's more, there are considerable barriers to competition in the cruise
industry because building ships is very expensive and time-consuming.
7 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
"We buy those stocks that we believe meet our stringent criteria for growth and
value, regardless of their industry affiliations."
An interview with your Fund's manager
- --------------------------------------------------------------------------------
Countrywide Credit Industries, Inc., a leading originator and servicer of
residential mortgages, has also contributed substantially to performance. Even
though Countrywide Credit is the leader in the industry, they have only a 5%
market share. In our view, that gives them plenty of room to grow in a
fragmented industry. Because it is among the industry's most efficient lenders,
Countrywide Credit has the ability to compete effectively, not just in packaging
and securitizing mortgages, but in originating them as well.
About 14% of the Fund's asset are in cash equivalents as of April 30. Why?
We've reduced our holdings of certain stocks that have reached their target
prices. By selling stocks that we no longer consider compelling values, we
believe we are reducing the valuation risk in the portfolio.
We view our cash position as a byproduct of our investment approach, not
as a comment on the direction of the market. If we are taking profits when
additional investments are flowing into the Fund, or when assets are awaiting
reinvestment, we will allow cash investments to build up temporarily.
8 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
"We've cut back on ownership of certain stocks as they've reached their target
prices."
Did any stocks disappoint you over the period?
Everest Re represents one investment that has not yet met our expectations. This
reinsurance company assumes some of the risk carried by primary insurance
companies in return for part of the premium. Everest Re enjoys a good market
position in a very profitable business. The company's balance sheet is
well-capitalized, and its management is capable and experienced. Yet, as of
April 30, Everest Re's stock was selling at a substantial discount to the
market. We believe that this is the best kind of "disappointment" to have in the
portfolio because we expect to be rewarded for our patience when Everest Re
reaches a more reasonable valuation.
What is your outlook for the foreseeable future?
Investors have experienced a remarkably strong stock market for more than three
years. At some point, the market is likely to consolidate its gains. We don't
make market predictions, but it's safe to say that we do not believe the market
will produce returns of 30% or more every year.
We've attempted to structure the portfolio so that it can participate in
most of the gains in rising markets, but avoid some of the volatility in
declining markets. In our view, this prudent approach to investing should serve
our shareholders well in the months ahead.
9 Oppenheimer Quest Value Fund, Inc.
<PAGE>
Financials
- --------------------------------------------------------------------------------
10 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Market Value
Shares See Note 1
================================================================================
Common Stocks--85.4%
- --------------------------------------------------------------------------------
Basic Materials--6.1%
- --------------------------------------------------------------------------------
Chemicals--4.6%
Du Pont (E.I.) De Nemours & Co. 370,000 $ 26,940,625
- --------------------------------------------------------------------------------
Hercules, Inc. 241,000 11,522,812
- --------------------------------------------------------------------------------
International Flavors & Fragrances, Inc. 620,000 30,341,250
--------------
68,804,687
- --------------------------------------------------------------------------------
Paper--1.5%
Champion International Corp. 430,000 23,139,375
- --------------------------------------------------------------------------------
Consumer Cyclicals--12.4%
- --------------------------------------------------------------------------------
Autos & Housing--0.5%
Security Capital Group, Inc., Cl. B(1) 262,850 7,951,212
- --------------------------------------------------------------------------------
Leisure & Entertainment--6.4%
AMR Corp.(1) 187,000 28,494,125
- --------------------------------------------------------------------------------
Carnival Corp., Cl. A 400,000 27,825,000
- --------------------------------------------------------------------------------
McDonald's Corp. 630,000 38,981,250
--------------
95,300,375
- --------------------------------------------------------------------------------
Media--2.9%
Omnicom Group, Inc. 511,000 24,208,625
- --------------------------------------------------------------------------------
Reed International plc, Sponsored ADR 240,000 8,820,000
- --------------------------------------------------------------------------------
WPP Group plc, Sponsored ADR 166,000 10,686,250
--------------
43,714,875
- --------------------------------------------------------------------------------
Retail: General--2.6%
May Department Stores Cos 623,000 38,431,312
- --------------------------------------------------------------------------------
Consumer Non-Cyclicals--8.2%
- --------------------------------------------------------------------------------
Food--1.7%
Diageo plc, Sponsored ADR 522,720 25,123,230
- --------------------------------------------------------------------------------
Healthcare/Supplies & Services--4.2%
Becton, Dickinson & Co. 398,000 27,710,750
- --------------------------------------------------------------------------------
Tenet Healthcare Corp.(1) 955,500 35,771,531
--------------
63,482,281
- --------------------------------------------------------------------------------
Tobacco--2.3%
Philip Morris Cos., Inc. 935,000 34,887,187
- --------------------------------------------------------------------------------
Energy--0.6%
- --------------------------------------------------------------------------------
Energy Services & Producers--0.6%
Anadarko Petroleum Corp. 119,300 8,738,725
11 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Unaudited) (Continued)
- --------------------------------------------------------------------------------
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
Financial--33.0%
- --------------------------------------------------------------------------------
Banks--5.4%
BankBoston Corp. 263,000 $ 28,387,563
- --------------------------------------------------------------------------------
Citicorp 175,000 26,337,500
- --------------------------------------------------------------------------------
Wells Fargo & Co. 69,666 25,671,921
--------------
80,396,984
- --------------------------------------------------------------------------------
Diversified Financial--8.3%
Countrywide Credit Industries, Inc. 620,000 29,992,500
- --------------------------------------------------------------------------------
Freddie Mac 752,000 34,827,000
- --------------------------------------------------------------------------------
Green Tree Financial Corp. 1,450,000 59,087,500
--------------
123,907,000
- --------------------------------------------------------------------------------
Insurance--19.3%(2)
ACE Ltd. 2,208,600 83,650,725
- --------------------------------------------------------------------------------
AFLAC, Inc. 379,050 24,638,250
- --------------------------------------------------------------------------------
American International Group, Inc. 88,500 11,643,281
- --------------------------------------------------------------------------------
Everest Reinsurance Holdings, Inc. 880,000 36,300,000
- --------------------------------------------------------------------------------
EXEL Ltd. 1,051,400 78,526,438
- --------------------------------------------------------------------------------
General Re Corp. 164,000 36,664,250
- --------------------------------------------------------------------------------
Mid Ocean Ltd. 219,600 16,552,350
--------------
287,975,294
- --------------------------------------------------------------------------------
Industrial--16.5%
- --------------------------------------------------------------------------------
Industrial Materials--1.1%
Armstrong World Industries, Inc. 190,000 16,292,500
- --------------------------------------------------------------------------------
Industrial Services--0.8%
Donnelley (R.R.) & Sons Co. 280,000 12,337,500
- --------------------------------------------------------------------------------
Manufacturing--11.0%
AlliedSignal, Inc. 300,000 13,143,750
- --------------------------------------------------------------------------------
Caterpillar, Inc. 580,000 33,023,750
- --------------------------------------------------------------------------------
Dover Corp. 730,000 28,835,000
- --------------------------------------------------------------------------------
LucasVarity plc, ADR 720,900 32,440,500
- --------------------------------------------------------------------------------
Minnesota Mining & Manufacturing Co. 130,000 12,268,750
- --------------------------------------------------------------------------------
Tenneco, Inc. 196,000 8,440,250
- --------------------------------------------------------------------------------
Textron, Inc. 460,000 35,995,000
--------------
164,147,000
- --------------------------------------------------------------------------------
Transportation--3.6%
Canadian Pacific Ltd. (New) 1,000,000 29,437,500
- --------------------------------------------------------------------------------
Union Pacific Corp. 450,000 24,637,500
--------------
54,075,000
12 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Market Value
Shares See Note 1
- --------------------------------------------------------------------------------
Technology--7.3%
- --------------------------------------------------------------------------------
Aerospace/Defense--4.0%
Lockheed Martin Corp. 540,000 $ 60,142,500
- --------------------------------------------------------------------------------
Computer Hardware--0.5%
Adaptec, Inc.(1) 300,000 7,106,250
- --------------------------------------------------------------------------------
Electronics--2.8%
Arrow Electronics, Inc.(1) 159,000 4,342,688
- --------------------------------------------------------------------------------
Avnet, Inc. 381,000 23,502,938
- --------------------------------------------------------------------------------
Solectron Corp.(1) 300,000 13,293,750
--------------
41,139,376
- --------------------------------------------------------------------------------
Utilities--1.3%
- --------------------------------------------------------------------------------
Telephone Utilities--1.3%
Sprint Corp. 285,200 19,482,725
--------------
Total Common Stocks (Cost $875,567,589) 1,276,575,388
Face
Amount
================================================================================
Short-Term Notes--14.0%(3)
- --------------------------------------------------------------------------------
American Express Credit Corp.:
5.49%, 5/11/98 $ 10,000,000 9,984,750
5.53%, 5/4/98 10,443,000 10,438,188
- --------------------------------------------------------------------------------
Associates Corp. of North America:
5.50%, 5/7/98 50,000,000 49,953,750
5.50%, 6/17/98 11,377,000 11,295,307
- --------------------------------------------------------------------------------
Ford Motor Credit Co., 5.50%, 5/21/98 33,905,000 33,801,401
- --------------------------------------------------------------------------------
General Motors Acceptance Corp., 5.51%, 5/18/98 10,007,000 9,959,606
- --------------------------------------------------------------------------------
Goldman Sachs Group LP:
5.51%, 5/7/98 40,700,000 40,662,624
5.52%, 5/11/98 13,929,000 13,907,681
- --------------------------------------------------------------------------------
IBM Credit Corp., 5.48%, 5/4/98 18,089,000 18,080,739
- --------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 5.53%, 6/25/98 12,219,000 12,115,766
--------------
Total Short-Term Notes (Cost $210,199,812) 210,199,812
- --------------------------------------------------------------------------------
Total Investments, at Value (Cost $1,085,767,401) 99.4% 1,486,775,200
- --------------------------------------------------------------------------------
Other Assets Net of Liabilities 0.6 8,379,126
----------- --------------
Net Assets 100.0% $1,495,154,326
=========== ==============
(1). Non-income producing security.
(2). The Fund may have elements of risk due to concentrated investments in
specific industries. Such concentrations may subject the Fund to additional
risks resulting from future political or economic conditions.
(3). Short-term notes are generally traded on a discount basis; the interest
rate is the discount rate received by the Fund at the time of purchase.
See accompanying Notes to Financial Statements.
13 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
Assets
Investments, at value (cost $1,085,767,401)--
see accompanying statement $1,486,775,200
- --------------------------------------------------------------------------------
Cash 60,574
- --------------------------------------------------------------------------------
Receivables:
Shares of capital stock sold 7,856,445
Investments sold 3,452,961
Interest and dividends 1,255,022
- --------------------------------------------------------------------------------
Other 72,112
--------------
Total assets 1,499,472,314
================================================================================
Liabilities
Payables and other liabilities:
Investments purchased 1,983,350
Shares of capital stock redeemed 1,829,550
Distribution and service plan fees 301,655
Transfer agent and accounting services fees 49,302
Directors' fees 6,078
Other 148,053
--------------
Total liabilities 4,317,988
================================================================================
Net Assets $1,495,154,326
==============
================================================================================
Composition of Net Assets
Par value of shares of capital stock $ 65,342,833
- --------------------------------------------------------------------------------
Additional paid-in capital 952,622,698
- --------------------------------------------------------------------------------
Undistributed net investment income 2,880,162
- --------------------------------------------------------------------------------
Accumulated net realized gain on investment transactions 73,300,834
- --------------------------------------------------------------------------------
Net unrealized appreciation on investments--Note 3 401,007,799
--------------
Net assets $1,495,154,326
==============
14 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Net Asset Value Per Share
Class A Shares:
Net asset value and redemption price per share (based on net assets
of $914,467,471 and 39,724,552 shares of capital stock outstanding) $23.02
Maximum offering price per share (net asset value plus sales charge
of 5.75% of offering price) $24.42
- --------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net
assets of $450,641,942 and 19,883,025 shares of capital stock
outstanding) $22.66
- --------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net
assets of $124,607,359 and 5,499,314 shares of capital stock
outstanding) $22.66
- --------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share
(based on net assets of $5,437,554 and 235,942 shares of capital
stock outstanding) $23.05
See accompanying Notes to Financial Statements.
15 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Operations For the Six Months Ended April 30, 1998 (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
Investment Income
Dividends (net of foreign withholding taxes of $134,915) $ 7,129,533
- --------------------------------------------------------------------------------
Interest 6,647,077
------------
Total income 13,776,610
================================================================================
Expenses
Management fees--Note 4 5,684,065
- --------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 1,958,909
Class B 1,783,070
Class C 499,316
- --------------------------------------------------------------------------------
Transfer agent and accounting services fees--Note 4:
Class A 337,365
Class B 161,564
Class C 46,019
Class Y 3,673
- --------------------------------------------------------------------------------
Registration and filing fees:
Class A 91,428
Class B 56,833
Class C 15,953
Class Y 825
- --------------------------------------------------------------------------------
Shareholder reports 125,622
- --------------------------------------------------------------------------------
Directors' fees and expenses 31,636
- --------------------------------------------------------------------------------
Custodian fees and expenses 21,587
- --------------------------------------------------------------------------------
Legal and auditing fees 17,116
- --------------------------------------------------------------------------------
Other 47,431
------------
Total expenses 10,882,412
================================================================================
Net Investment Income 2,894,198
================================================================================
Realized and Unrealized Gain
Net realized gain on investments 73,329,110
- --------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation
on investments 131,967,352
------------
Net realized and unrealized gain 205,296,462
================================================================================
Net Increase in Net Assets Resulting from Operations $208,190,660
============
See accompanying Notes to Financial Statements.
16 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended Year Ended
April 30, 1998 October 31,
(Unaudited) 1997
=========================================================================================
<S> <C> <C>
Operations
Net investment income $ 2,894,198 $ 4,771,423
- ---------------------------------------------------------------------------------------
Net realized gain 73,329,110 47,887,290
- ---------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 131,967,352 127,277,273
-------------- --------------
Net increase in net assets resulting from operations 208,190,660 179,935,986
=======================================================================================
Dividends and Distributions to Shareholders
Dividends from net investment income:
Class A (3,823,160) (1,801,385)
Class B (722,423) (107,344)
Class C (193,328) (27,574)
Class Y (30,052) --
- ---------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (30,481,723) (22,962,861)
Class B (13,495,685) (6,696,217)
Class C (3,754,863) (1,768,806)
Class Y (142,430) --
=======================================================================================
Capital Stock Transactions
Net increase in net assets resulting from
capital stock transactions--Note 2:
Class A 118,041,918 186,699,902
Class B 107,210,320 151,470,057
Class C 29,761,616 42,571,844
Class Y 1,830,138 2,817,095
=======================================================================================
Net Assets
Total increase 412,390,988 530,130,697
- ---------------------------------------------------------------------------------------
Beginning of period 1,082,763,338 552,632,641
-------------- --------------
End of period (including undistributed net investment
income of $2,880,162 and $4,754,927, respectively) $1,495,154,326 $1,082,763,338
============== ==============
</TABLE>
See accompanying Notes to Financial Statements.
17 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class A
---------------------------------------------------
Six Months Ended
April 30, 1998 Year Ended October 31,
(Unaudited) 1997 1996(3) 1995
======================================================================================================
<S> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $20.49 $17.30 $14.51 $12.59
- ------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .06 .11 .08 .12(4)
Net realized and unrealized gain (loss) 3.45 4.07 3.79 2.71
------ ------ ------ ------
Total income (loss) from investment
operations 3.51 4.18 3.87 2.83
- ------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.11) (.07) (.10) (.08)
Distributions from net realized gain (.87) (.92) (.98) (.83)
------ ------ ------ ------
Total dividends and distributions to shareholders (.98) (.99) (1.08) (.91)
- ------------------------------------------------------------------------------------------------------
Net asset value, end of period $23.02 $20.49 $17.30 $14.51
====== ====== ====== ======
======================================================================================================
Total Return, at Net Asset Value(5) 17.86% 25.41% 28.39% 24.74%
======================================================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $914,467 $699,230 $412,246 $282,615
- ------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $791,248 $560,582 $338,429 $257,240
- ------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) 0.65%(6) 0.74% 0.58% 0.90%
Expenses 1.56%(6) 1.60% 1.71% 1.68%
- ------------------------------------------------------------------------------------------------------
Portfolio turnover rate(7) 13.2% 19.7% 36.0% 36.0%
Average brokerage commission rate(8) $0.0579 $0.0573 $0.0559 --
</TABLE>
(1). For the period from December 16, 1996 (inception of offering) to October
31, 1997.
(2). For the period from September 1, 1993 (inception of offering) to October
31, 1993.
(3). On November 22, 1995, OppenheimerFunds, Inc. became the investment advisor
to the Fund.
(4). Based on average shares outstanding for the period.
(5). Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), with all dividends
and distributions reinvested in additional shares on the reinvestment date, and
redemption at the net asset value calculated on the last business day of the
fiscal period. Sales charges are not reflected in the total returns. Total
returns are not annualized for periods of less than one full year.
18 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
Class B
------------------------ ---------------------------------------------------------
Six Months Ended
April 30, 1998 Year Ended October 31,
1994 1993 (Unaudited) 1997 1996(3) 1995 1994
=================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $12.51 $11.71 $20.17 $17.08 $14.37 $12.53 $12.51
- ---------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .09(4) .05(4) .02 .05 .05 .05(4) .02(4)
Net realized and unrealized gain (loss) .50 1.34 3.39 3.97 3.71 2.69 .50
------ ------ ------ ------ ------ ------ -------
Total income (loss) from investment
operations .59 1.39 3.41 4.02 3.76 2.74 .52
- ---------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.04) (.05) (.05) (.01) (.07) (.07) (.03)
Distributions from net realized gain (.47) (.54) (.87) (.92) (.98) (.83) (.47)
------ ------ ------ ------ ------ ------ ------
Total dividends and distributions to
shareholders (.51) (.59) (.92) (.93) (1.05) (.90) (.50)
- ---------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $12.59 $12.51 $22.66 $20.17 $17.08 $14.37 $12.53
====== ====== ====== ====== ====== ====== ======
=================================================================================================================================
Total Return, at Net Asset Value(5) 5.01% 12.27% 17.58% 24.71% 27.76% 24.08% 4.43%
=================================================================================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $238,085 $245,320 $450,642 $298,348 $111,130 $38,557 $14.373
- ---------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $237,923 $205,074 $360,409 $200,572 $68,175 $25,393 $8,341
- ---------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) 0.72% 0.40% 0.14%(6) 0.25% 0.06% 0.36% 0.14%
Expenses 1.71% 1.75% 2.07%(6) 2.10% 2.26% 2.21% 2.24%
- ---------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(7) 49.0% 27.0% 13.2% 19.7% 36.0% 36.0% 49.0%
Average brokerage commission rate(8) -- -- $0.0579 $0.0573 $0.0559 -- --
</TABLE>
(6). Annualized.
(7). The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended April 30, 1998 were $323,080,159 and $135,510,770, respectively.
(8). Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period, divided by the total number of related
shares purchased and sold.
19 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class B Class C
---------- ----------------------------
Year Ended Six Months Ended Year Ended
October 31, April 30, 1998 October 31,
1993(2) (Unaudited) 1997
============================================================================================
<S> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $12.66 $20.17 $17.07
- --------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.01)(4) .02 .05
Net realized and unrealized gain (loss) (.14) 3.39 3.98
------ ------ ------
Total income (loss) from investment
operations (.15) 3.41 4.03
- --------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income -- (.05) (.01)
Distributions from net realized gain -- (.87) (.92)
------ ------ ------
Total dividends and distributions to shareholders -- (.92) (.93)
- --------------------------------------------------------------------------------------------
Net asset value, end of period $12.51 $22.66 $20.17
====== ====== ======
============================================================================================
Total Return, at Net Asset Value(5) (1.19)% 17.57% 24.79%
============================================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $2,015 $124,607 $82,098
- --------------------------------------------------------------------------------------------
Average net assets (in thousands) $1,136 $100,927 $55,969
- --------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) (1.19)%(6) 0.14%(6) 0.25%
Expenses 2.27%(6) 2.07%(6) 2.10%
- --------------------------------------------------------------------------------------------
Portfolio turnover rate(7) 27.0% 13.2% 19.7%
Average brokerage commission rate(8) -- $0.0579 $0.0573
</TABLE>
(1). For the period from December 16, 1996 (inception of offering) to October
31, 1997.
(2). For the period from September 1, 1993 (inception of offering) to October
31, 1993.
(3). On November 22, 1995, OppenheimerFunds, Inc. became the investment advisor
to the Fund.
(4). Based on average shares outstanding for the period.
(5). Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), with all dividends
and distributions reinvested in additional shares on the reinvestment date, and
redemption at the net asset value calculated on the last business day of the
fiscal period. Sales charges are not reflected in the total returns. Total
returns are not annualized for periods of less than one full year.
20 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class Y
------------------------------------------- ----------------------------
Period Ended Period Ended
April 30, 1998 October 31,
1996(3) 1995 1994 1993(2) (Unaudited) 1997(1)
============================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $14.35 $12.52 $12.50 $12.66 $20.55 $16.50
- ----------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .04 .04(4) .01(4) (.01)(4) .11 .10
Net realized and unrealized gain (loss) 3.71 2.70 .51 (.15) 3.44 3.95
------ ------ ------ ------ ------ ------
Total income (loss) from investment
operations 3.75 2.74 .52 (.16) 3.55 4.05
- ----------------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.05) (.08) (.03) -- (.18) --
Distributions from net realized gain (.98) (.83) (.47) -- (.87) --
------ ------ ------ ------ ------ ------
Total dividends and distributions to shareholders (1.03) (.91) (.50) -- (1.05) --
- ----------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $17.07 $14.35 $12.52 $12.50 $23.05 $20.55
====== ====== ====== ====== ====== ======
============================================================================================================================
Total Return, at Net Asset Value(5) 27.73% 24.10% 4.45% (1.26)% 18.09% 24.55%
============================================================================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $29,256 $10,140 $3,581 $221 $5,438 $3,086
- ----------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $18,099 $6,711 $1,725 $169 $4,085 $1,372
- ----------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) 0.06% 0.31% 0.09% (0.90)% 1.03%(6) 1.20%(6)
Expenses 2.20% 2.26% 2.28% 2.27% 1.17%(6) 1.19%(6)
- ----------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(7) 36.0% 36.0% 49.0% 27.0% 13.2% 19.7%
Average brokerage commission rate(8) $0.0559 -- -- -- $0.0579 $0.0573
</TABLE>
(6). Annualized.
(7). The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended April 30, 1998 were $323,080,159 and $135,510,770, respectively.
(8). Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period, divided by the total number of related
shares purchased and sold.
See accompanying Notes to Financial Statements.
21 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
================================================================================
1. Significant Accounting Policies
Oppenheimer Quest Value Fund, Inc. (the Fund) is registered under the Investment
Company Act of 1940, as amended, as a diversified, open-end management
investment company. The Fund's investment objective is to seek capital
appreciation. The Fund seeks its investment objective through investment in
securities (primarily equity securities) of companies believed by management to
be undervalued in the marketplace in relation to factors such as the companies'
assets, earnings, growth potential and cash flows. The Fund's investment advisor
is OppenheimerFunds, Inc. (the Manager) and the Manager has entered into a
sub-advisory agreement with OpCap Advisors. The Fund offers Class A, Class B,
Class C and Class Y shares. Class A shares are sold with a front-end sales
charge. Class B and Class C shares may be subject to a contingent deferred sales
charge. All classes of shares have identical rights to earnings, assets and
voting privileges, except that each class has its own expenses directly
attributable to that class and exclusive voting rights with respect to matters
affecting that class. Classes A, B and C have separate distribution and/or
service plans. No such plan has been adopted for Class Y shares. Class B shares
will automatically convert to Class A shares six years after the date of
purchase. The following is a summary of significant accounting policies
consistently followed by the Fund.
- --------------------------------------------------------------------------------
Investment Valuation. Portfolio securities are valued at the close of the New
York Stock Exchange on each trading day. Listed and unlisted securities for
which such information is regularly reported are valued at the last sale price
of the day or, in the absence of sales, at values based on the closing bid or
the last sale price on the prior trading day. Long-term and short-term
"non-money market" debt securities are valued by a portfolio pricing service
approved by the Board of Directors. Such securities which cannot be valued by an
approved portfolio pricing service are valued using dealer-supplied valuations
provided the Manager is satisfied that the firm rendering the quotes is reliable
and that the quotes reflect current market value, or are valued under
consistently applied procedures established by the Board of Directors to
determine fair value in good faith. Short-term "money market type" debt
securities having a remaining maturity of 60 days or less are valued at cost (or
last determined market value) adjusted for amortization to maturity of any
premium or discount.
22 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Allocation of Income, Expenses, and Gains and Losses. Income, expenses (other
than those attributable to a specific class) and gains and losses are allocated
daily to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
Federal Taxes. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
- --------------------------------------------------------------------------------
Distributions to Shareholders. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- --------------------------------------------------------------------------------
Classification of Distributions to Shareholders. Net investment income (loss)
and net realized gain (loss) may differ for financial statement and tax
purposes. The character of the distributions made during the year from net
investment income or net realized gains may differ from its ultimate
characterization for federal income tax purposes. Also, due to timing of
dividend distributions, the fiscal year in which amounts are distributed may
differ from the fiscal year in which the income or realized gain was recorded by
the Fund.
- --------------------------------------------------------------------------------
Other. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date) and dividend income is recorded on the
ex-dividend date. Interest income is accrued on a daily basis. Realized gains
and losses on investments and unrealized appreciation and depreciation are
determined on an identified cost basis, which is the same basis used for federal
income tax purposes.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
23 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
================================================================================
2. Capital Stock
The Fund has authorized 100 million shares of $1.00 par value capital stock in
the aggregate to be apportioned among each class of shares. Transactions in
shares of capital stock were as follows:
<TABLE>
<CAPTION>
Six Months Ended April 30, 1998 Year Ended October 31, 1997(1)
------------------------------- ------------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 7,035,432 $150,938,135 15,030,841 $278,180,029
Dividends and distributions
reinvested 1,630,197 32,669,070 1,380,466 23,316,006
Redeemed (3,071,690) (65,565,287) (6,112,033) (114,796,133)
---------- ------------- ----------- -------------
Net increase 5,593,939 $118,041,918 10,299,274 $186,699,902
========== ============= =========== =============
- -------------------------------------------------------------------------------------------
Class B:
Sold 5,350,322 $113,496,052 9,222,271 $169,517,668
Dividends and distributions
reinvested 679,359 13,430,925 382,280 6,387,808
Redeemed (935,420) (19,716,657) (1,323,617) (24,435,419)
---------- ------------- ----------- -------------
Net increase 5,094,261 $107,210,320 8,280,934 $151,470,057
========== ============= =========== =============
- -------------------------------------------------------------------------------------------
Class C:
Sold 1,661,546 $35,003,860 2,955,467 $54,066,076
Dividends and distributions
reinvested 192,927 3,812,229 105,641 1,764,202
Redeemed (425,772) (9,054,473) (704,333) (13,258,434)
---------- ------------- ----------- -------------
Net increase 1,428,701 $29,761,616 2,356,775 $42,571,844
========== ============= =========== =============
- -------------------------------------------------------------------------------------------
Class Y:
Sold 99,591 $2,136,596 176,674 $3,355,435
Dividends and distributions
reinvested 8,611 172,481 -- --
Redeemed (22,484) (478,939) (26,450) (538,340)
---------- ------------- ----------- -------------
Net increase 85,718 $1,830,138 150,224 $2,817,095
========== ============= =========== =============
</TABLE>
(1). For the year ended October 31, 1997 for Class A, B and C and for the period
from December 16, 1996 (inception of offering) to October 31, 1997 for Class Y
shares.
================================================================================
3. Unrealized Gains and Losses on Investments
At April 30, 1998, net unrealized appreciation on investments of $401,007,799
was composed of gross appreciation of $406,850,754, and gross depreciation of
$5,842,955.
24 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
4. Management Fees and Other Transactions with Affiliates
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for a fee of 1.00% of the first
$400 million of average annual net assets, 0.90% of the next $400 million of
average annual net assets, 0.85% of the next $3.2 billion of average annual net
assets, 0.80% of the next $4 billion of the Fund's average annual net assets,
and 0.75% of average annual net assets over $8 billion. The Manager acts as the
accounting agent for the Fund at an annual fee of $55,000, plus out-of-pocket
costs and expenses reasonably incurred.
The Manager pays OpCap Advisors (the Sub-Advisor) based on the
fee schedule set forth in the Prospectus. For the six months ended April 30,
1998, the Manager paid $1,878,756 to the Sub-Advisor.
For the six months ended April 30, 1998, commissions (sales
charges paid by investors) on sales of Class A shares totaled $2,054,734, of
which $553,038 was retained by OppenheimerFunds Distributor, Inc. (OFDI), a
subsidiary of the Manager, as general distributor, and by an affiliated
broker/dealer. Sales charges advanced to broker/dealers by OFDI on sales of the
Fund's Class B and Class C shares totaled $3,638,399 and $297,540, respectively,
of which $215,761 and $4,902, respectively, was paid to an affiliated
broker/dealer. During the six months ended April 30, 1998, OFDI received
contingent deferred sales charges of $273,875 and $21,481, respectively, upon
redemption of Class B and Class C shares as reimbursement for sales commissions
advanced by OFDI at the time of sale of such shares.
OppenheimerFunds Services (OFS), a division of the Manager, is
the transfer and shareholder servicing agent for the Fund and for other
registered investment companies. The Fund pays OFS an annual maintenance fee of
$14.85 for each Fund shareholder account and reimburses OFS for its
out-of-pocket expenses. During the six months ended April 30, 1998, the Fund
paid OFS $528,355. Effective May 1, 1998, the Board of Directors approved an
increase in the annual maintenance fee from $14.85 to $18.00 for each
shareholder account.
The Fund has adopted a Distribution and Service Plan for Class A
shares to compensate OFDI for a portion of its costs incurred in connection with
the personal service and maintenance of shareholder accounts that hold Class A
shares. Under the Plan, the Fund pays an annual asset-based sales charge to OFDI
of 0.25% per year on Class A shares. The Fund also pays a service fee to OFDI of
0.25% per year. Each fee is computed on the average annual net assets of Class A
shares of the Fund, determined as of the close of each regular business day.
OFDI uses all of the service fee and a portion of the asset-based sales charge
to compensate brokers, dealers, banks and other financial institutions quarterly
for providing personal service and maintenance of shareholder accounts of their
customers that hold Class A shares. OFDI retains the balance of the asset-based
sales charge to reimburse itself for its other expenditures under the Plan.
During the six months ended April 30, 1998, OFDI paid $39,316 to an affiliated
broker/dealer as compensation for Class A personal service and maintenance
expenses.
25 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements (Unaudited) (Continued)
- --------------------------------------------------------------------------------
================================================================================
4. Management Fees and Other Transactions with Affiliates (continued)
The Fund has adopted Distribution and Service Plans for Class B and Class C
shares to compensate OFDI for its costs in distributing Class B and Class C
shares and servicing accounts. Under the Plans, the Fund pays OFDI an annual
asset-based sales charge of 0.75% per year on Class B and Class C shares for
it's services rendered in distributing Class B and Class C shares. OFDI also
receives a service fee of 0.25% per year to compensate dealers for providing
personal services for accounts that hold Class B and Class C shares. Each fee is
computed on the average annual net assets of Class B or Class C shares,
determined as of the close of each regular business day. During the six months
ended April 30, 1998, OFDI paid $6,211 and $2,230, respectively, to an
affiliated broker/dealer as compensation for Class B and Class C personal
service and maintenance expenses and retained $1,545,233 and $313,844,
respectively, as compensation for Class B and Class C sales commissions and
service fee advances, as well as financing costs. If either Plan is terminated
by the Fund, the Board of Directors may allow the Fund to continue payments of
the asset-based sales charge to OFDI for distributing shares before the Plan was
terminated. At April 30, 1998, OFDI had incurred excess distribution and
servicing costs of $9,594,018 for Class B and $1,022,437 for Class C.
================================================================================
5. Bank Borrowings
The Fund may borrow from a bank for temporary or emergency purposes including,
without limitation, funding of shareholder redemptions provided asset coverage
for borrowings exceeds 300%. The Fund has entered into an agreement which
enables it to participate with other Oppenheimer funds in an unsecured line of
credit with a bank, which permits borrowings up to $400 million, collectively.
Interest is charged to each fund, based on its borrowings, at a rate equal to
the Federal Funds Rate plus 0.35%. Borrowings are payable 30 days after such
loan is executed. The Fund also pays a commitment fee equal to its pro rata
share of the average unutilized amount of the credit facility at a rate of
0.0575% per annum.
The Fund had no borrowings outstanding during the six months
ended April 30, 1998.
26 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Oppenheimer Quest Value Fund, Inc.
- --------------------------------------------------------------------------------
================================================================================
Officers and Directors Bridget A. Macaskill, Chairman of the Board of
Directors and President
Paul Y. Clinton, Director
Thomas W. Courtney, Director
Lacy B. Herrmann, Director
George Loft, Director
Robert C. Doll, Jr., Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
================================================================================
Investment Advisor OppenheimerFunds, Inc.
================================================================================
Sub-Advisor OpCap Advisors
================================================================================
Distributor OppenheimerFunds Distributor, Inc.
================================================================================
Transfer and Shareholder OppenheimerFunds Services
Servicing Agent
================================================================================
Custodian of State Street Bank and Trust Company
Portfolio Securities
================================================================================
Independent Accountants Price Waterhouse LLP
================================================================================
Legal Counsel Gordon Altman Butowsky Weitzen Shalov & Wein
The financial statements included herein have been
taken from the records of the Fund without examination
by the independent accountants. This is a copy of a
report to shareholders of Oppenheimer Quest Value Fund,
Inc. This report must be preceded or accompanied by a
Prospectus of Oppenheimer Quest Value Fund, Inc. For
material information concerning the Fund, see the
Prospectus.
Shares of Oppenheimer funds are not deposits or
obligations of any bank, are not guaranteed by any
bank, and are not insured by the FDIC or any other
agency, and involve investment risks, including
possible loss of the principal amount invested.
27 Oppenheimer Quest Value Fund, Inc.
<PAGE>
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information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the Oppenheimer funds' transfer agent,
OppenheimerFunds Services, with their Award of Excellence in 1993.
So call us today, or visit us at our website at
www.oppenheimerfunds.com--we're here to help.
[LOGO] OppenheimerFunds(SM)
Distributor, Inc.
RS0225.001.0498 June 29, 1998
