Semiannual Report April 30, 1999
O P P E N H E I M E R
Quest Value
Fund, Inc.
[photo of calculator]
[logo]
OppenheimerFunds(R)
THE RIGHT WAY TO INVEST
<PAGE>
Contents
3 President's Letter
5 An Interview with Your Fund's Manager
11 Financial Statements
28 Officers and Directors
32 Information and Services
Report highlights
- --------------------------------------------------------------------------------
(bullet) Value stocks continued to lag growth stocks, bringing relative
valuations to their widest levels in years.
(bullet) Instead of investing directly in highly valued technology companies,
the Fund focused on reasonably priced companies in other industries that are
expected to benefit from new technologies.
Cumulative Total Returns
For the 6-Month Period
Ended 4/30/99
<TABLE>
<CAPTION>
Class A
Without With
Sales Chg.(1) Sales Chg.(2)
- -------------------------
<S> <C>
12.34% 5.89%
- -------------------------
<CAPTION>
Class B
Without With
Sales Chg.(1) Sales Chg.(2)
- -------------------------
<S> <C>
12.00% 7.00%
- -------------------------
<CAPTION>
Class C
Without With
Sales Chg.(1) Sales Chg.(2)
- -------------------------
<S> <C>
12.03% 11.03%
- -------------------------
<CAPTION>
Class Y
Without With
Sales Chg.(1) Sales Chg.(2)
- -------------------------
<S> <C>
12.35% 12.35%
</TABLE>
Total returns include changes in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
Cumulative total returns are not annualized. 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. Because the stock market can be volatile, the Fund's
performance may be subject to substantial short-term changes. For updates on the
Fund's performance, please contact your financial advisor, call us at
1-800-525-7048 or visit our website, www.oppenheimerfunds.com. OppenheimerFunds,
Inc. became the Fund's advisor on 11/22/95. The Fund's sub-advisor is OpCap
Advisors, which was the Fund's advisor prior to 11/22/95. The portfolio manager
is employed by the Fund's sub-advisor.
1. Includes changes in net asset value per share without deducting any sales
charges.
2. 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 are available only to certain institutional investors under
special agreement with the Distributor. Class A shares are subject to an annual
0.25% asset-based sales charge while Class B and C shares are subject to an
annual 0.75% asset-based sales charge. An explanation of the different
performance calculations is in the Fund's prospectus.
2 Oppenheimer Quest Value Fund, Inc.
<PAGE>
[photo]
Bridget A. Macaskill
President
Oppenheimer
Quest Value Fund, Inc.
Dear shareholder,
- --------------------------------------------------------------------------------
According to popular belief, the last six months have been particularly
favorable for the financial markets.
The truth of the matter is that it's been a long, uphill struggle for the
diversified investor. That's because the stock market's dramatic rise reflects
the performance of the Dow Jones Industrial Average, which has been fueled by
only a small number of large-capitalization growth stocks and technology
companies. In the bond market this year, while many corporate and foreign bonds
have provided relatively attractive returns, the first quarter of 1999 was the
worst quarter in history for U.S. Treasury securities.(1)
Recently, though, signs of change have been emerging that confirm the
importance of a well-diversified portfolio. While investors focusing on
large-cap growth and technology stocks may have achieved superior short-term
returns, they may have also dramatically increased their exposure to potential
risks. If recent economic and market trends persist, previously out-of-favor
stocks may continue to rise.
Specifically, U.S. economic growth has continued to surpass most analysts'
expectations and the breadth of the market's positive performance has begun to
widen. This has raised concerns that inflationary pressures may re-emerge. In
fact, the Federal Reserve Board recently indicated its readiness to raise
short-term interest rates as an inflation-fighting measure. Looking outside of
the United States, many foreign economies also appear to be on the mend. The
impact of these changes, as it applies to your fund, is discussed more fully
inside by your portfolio manager.
(over, please)
1. Foreign investing entails higher expenses and risks, such as foreign currency
fluctuations, economic and political instability, and differences in accounting
standards.
3 Oppenheimer Quest Value Fund, Inc.
<PAGE>
You may also have wondered about the impact of the Year 2000 problem on your
investments. While we cannot predict the final outcome, we are pleased that many
companies and governments appear to be making progress toward avoiding a major
disruption. For our part, OppenheimerFunds is in the advanced stages of our Y2K
project, and we have successfully participated in industry-wide tests.
Meanwhile, we intend to maintain the disciplined investment approach that
has been helping Oppenheimer funds shareholders for more than 40 years as they
pursue their financial goals. Our longstanding experience has taught us that
while investment fads come and go, prudent diversification remains key to
successful investing. In fact, it is an essential part of what makes
OppenheimerFunds The Right Way to Invest.
Sincerely,
/s/ Bridget A. Macaskill
Bridget A. Macaskill
May 21, 1999
4 Oppenheimer Quest Value Fund, Inc.
<PAGE>
[photo]
Portfolio Management
Team (l to r)
David Phillips
Eileen Rominger
(Portfolio Manager)
An interview with your Fund's manager
- --------------------------------------------------------------------------------
How did Oppenheimer Quest Value Fund, Inc. perform during the six-month period
that ended April 30, 1999?
The Fund's performance over the past six months reflected the very difficult
market environment that has existed for value-oriented stocks. While the Fund's
holdings generated reasonably good returns, their performance continued to lag
that of growth-oriented stocks. The relatively stronger performance of the
growth sector has been attributable to the steep decline in long-term interest
rates from 1997 through late 1998, and to a weak global economy which prevented
all but a handful of unique growth companies from raising prices. The stock
market's gains over the past six months were concentrated in a relatively small
number of companies, primarily in the telecommunications, pharmaceutical,
technology, and Internet-related industries.
The decline in long-term interest rates has reversed somewhat since last
October. Accordingly, there has been a notable improvement in the relative price
performance of the value sector and the Fund's holdings in the past month.
5 Oppenheimer Quest Value Fund, Inc.
<PAGE>
Avg Annual Total Returns
For the Periods Ended 3/31/99(1)
<TABLE>
<CAPTION>
Class A
1 year 5 year 10 year
- ---------------------------
<S> <C> <C>
- -7.98% 18.23% 14.66%
- ---------------------------
<CAPTION>
Class B
Since
1 year 5 year Inception
- ---------------------------
<S> <C> <C>
- -7.51% 18.82% 16.01%
- ---------------------------
<CAPTION>
Class C
Since
1 year 5 year Inception
- ---------------------------
<S> <C> <C>
- -3.80% 19.01% 16.10%
- ---------------------------
<CAPTION>
Class Y
Since
1 year 5 year Inception
- ---------------------------
<S> <C> <C>
- -1.95% N/A 16.63%
- ---------------------------
</TABLE>
An interview with your Fund's manager
- --------------------------------------------------------------------------------
Given the wide disparity in valuations within the stock market, have you been
finding attractive values in companies you want to own?
The spread between the valuation of growth stocks and value stocks has seldom
been wider than today. We believe this represents a good opportunity for the
value stocks already in the portfolio as well as for the selected few we have
been adding.
What was your investment strategy in this market environment?
As always, we seek to invest in strong companies which have achieved competitive
advantage within their respective industries. Increasingly, we find that these
companies tend to be at the forefront in their use of technology to lower costs,
to improve product offerings, and to enhance distribution. For example, one such
company used technology aggressively to reduce costs and to become the largest
originator of mortgages on the Internet. These companies enjoy many of the
benefits of cutting-edge technology, yet the stocks do not sell at the extremely
high valuation levels of technology stocks.
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 1% (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. Class A shares are subject to an annual 0.25%
asset-based sales charge while Class B and C shares are subject to an annual
0.75% asset-based sales charge. An explanation of the different performance
calculations is in the Fund's prospectus.
6 Oppenheimer Quest Value Fund, Inc.
<PAGE>
How have you managed the portfolio in this environment?
We carefully monitor both price risk and operating business risk for the
portfolio's holdings. We establish and document target prices for each
investment, and when stocks reach the target price they become candidates for
sale. Target prices are based upon cash flow projections, comparable business
values, and historic valuation levels. We seek to own stocks at prices low
enough to encompass a margin of safety.
Operating business risk is analyzed by conducting extensive fundamental
analysis on every stock in the portfolio, including frequent company visits.
What stocks contributed most positively to performance?
Rockwell International Corp. and AlliedSignal, Inc. are two of the Fund's top
contributors for the period. A common theme for these two multi-industry
industrial companies is an intense focus by top management on creating value for
shareholders. Both have restructured to achieve this goal.
Two advertising companies, including WPP Group plc, were also among the
contributors. Both companies have acquired a number of smaller competitors,
realizing greater operating efficiencies and creating more diversity in their
books of business. New client groups, such as Internet-related companies, and
new advertising vehicles, such as new cable television channels, have fueled
their success.
7 Oppenheimer Quest Value Fund, Inc.
<PAGE>
An interview with your Fund's manager
- --------------------------------------------------------------------------------
Let's discuss a stock that was a disappointment.
Insurance company XL Capital Ltd. declined modestly over the past six months.
The stock has been weak due to investor impatience with a prolonged insurance
industry downturn in pricing, and due to XL's impending purchase of another
insurance company, which has caused some arbitrage activity. We think that
industry pricing has begun to recover somewhat and that the temporary arbitrage
pressures will ease when the acquisition is completed in June.
What is your outlook for the Fund?
We are encouraged about the outlook for our value investment style in 1999.
Value-oriented stocks have seldom been as attractively priced relative to
growth-oriented stocks as they are today. The economic factors that led to the
outperformance of growth stocks last year--sharply declining long rates and the
weak global economy--have started to reverse. In the meantime, we have
maintained the highly disciplined investment approach that has helped the Fund
seek good risk-adjusted returns.
2. Portfolio is subject to change. Percentages are as of April 30, 1999, and are
based on total market value of investments.
8 Oppenheimer Quest Value Fund, Inc.
<PAGE>
Asset Allocation(2)
[pie chart]
Stocks 95.7%
Cash Equivalents 4.3
We are confident that our emphasis on high quality businesses and reasonable
valuation levels should continue to support attractive long-term returns. In
fact, maintaining our discipline amid temporarily unfavorable market conditions
is a key component of what makes OppenheimerFunds The Right Way to Invest.
Top 10 Stock Holdings(2)
- ----------------------------------------------------------
XL Capital Ltd. 4.3%
- ----------------------------------------------------------
Rockwell International Corp. 3.9
- ----------------------------------------------------------
Computer Associates International, Inc. 3.4
- ----------------------------------------------------------
Textron, Inc. 3.3
- ----------------------------------------------------------
AMR Corp. 3.2
- ----------------------------------------------------------
Avery-Dennison Corp. 3.2
- ----------------------------------------------------------
Minnesota Mining & Manufacturing Co. 3.2
- ----------------------------------------------------------
AlliedSignal, Inc. 3.0
- ----------------------------------------------------------
Citigroup, Inc. 3.0
- ----------------------------------------------------------
Dover Corp. 3.0
- ----------------------------------------------------------
Top 5 Industries(2)
- ----------------------------------------------------------
Insurance 18.0%
- ----------------------------------------------------------
Manufacturing 17.8
- ----------------------------------------------------------
Diversified Financial 8.9
- ----------------------------------------------------------
Banks 5.6
- ----------------------------------------------------------
Chemicals 4.9
- ----------------------------------------------------------
9 Oppenheimer Quest Value Fund, Inc.
<PAGE>
Financials
- ----------------------------------------------------------
10 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
==================================================================================
<S> <C> <C>
Common Stocks--96.5%
- ----------------------------------------------------------------------------------
Basic Materials--5.4%
- ----------------------------------------------------------------------------------
Chemicals--4.9%
Du Pont (E.I.) De Nemours & Co. 580,000 $ 40,962,500
- ----------------------------------------------------------------------------------
International Flavors & Fragrances, Inc. 320,000 12,640,000
- ----------------------------------------------------------------------------------
Monsanto Co. 750,000 33,937,500
------------
87,540,000
- ----------------------------------------------------------------------------------
Paper--0.5%
Champion International Corp. 155,000 8,476,562
- ----------------------------------------------------------------------------------
Capital Goods--26.1%
- ----------------------------------------------------------------------------------
Aerospace/Defense--3.0%
General Dynamics Corp. 420,000 29,505,000
- ----------------------------------------------------------------------------------
Raytheon Co., Cl. A 143,400 9,921,487
- ----------------------------------------------------------------------------------
Raytheon Co., Cl. B 196,200 13,783,050
------------
53,209,537
- ----------------------------------------------------------------------------------
Electrical Equipment--3.9%
Rockwell International Corp. 1,345,000 69,435,625
- ----------------------------------------------------------------------------------
Industrial Services--1.3%
Waste Management, Inc. 412,200 23,289,300
- ----------------------------------------------------------------------------------
Manufacturing--17.9%
AlliedSignal, Inc. 920,000 54,050,000
- ----------------------------------------------------------------------------------
Avery-Dennison Corp. 840,000 57,330,000
- ----------------------------------------------------------------------------------
Caterpillar, Inc. 580,000 37,337,500
- ----------------------------------------------------------------------------------
Dover Corp. 1,440,000 53,190,000
- ----------------------------------------------------------------------------------
Minnesota Mining & Manufacturing Co. 640,000 56,960,000
- ----------------------------------------------------------------------------------
Textron, Inc. 640,000 58,960,000
------------
317,827,500
- ----------------------------------------------------------------------------------
Communication Services--2.1%
- ----------------------------------------------------------------------------------
Telecommunications: Long Distance--2.1%
L.M. Ericsson Telephone Co., Cl. B, ADR 300,000 8,100,000
- ----------------------------------------------------------------------------------
Sprint Corp. (Fon Group) 285,200 29,250,825
------------
37,350,825
- ----------------------------------------------------------------------------------
Consumer Cyclicals--11.1%
- ----------------------------------------------------------------------------------
Autos & Housing--0.4%
Armstrong World Industries, Inc. 120,000 6,570,000
- ----------------------------------------------------------------------------------
Consumer Services--2.1%
Omnicom Group, Inc. 511,000 37,047,500
- ----------------------------------------------------------------------------------
Leisure & Entertainment--1.6%
Carnival Corp. 680,000 28,050,000
</TABLE>
11 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Investments (Unaudited) (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
==================================================================================
<S> <C> <C>
Media--4.9%
Donnelley (R.R.) & Sons Co. 580,000 $ 20,517,500
- ----------------------------------------------------------------------------------
Hollinger International, Inc. 1,190,800 16,745,625
- ----------------------------------------------------------------------------------
WPP Group plc, Sponsored ADR 566,000 49,666,500
------------
86,929,625
- ----------------------------------------------------------------------------------
Retail: General--2.1%
May Department Stores Co. 934,500 37,204,781
- ----------------------------------------------------------------------------------
Consumer Staples--4.8%
- ----------------------------------------------------------------------------------
Broadcasting--1.2%
Chancellor Media Corp.(1) 392,900 21,560,387
- ----------------------------------------------------------------------------------
Entertainment--2.0%
McDonald's Corp. 860,000 36,442,500
- ----------------------------------------------------------------------------------
Food--1.2%
Diageo plc, Sponsored ADR 471,120 21,730,410
- ----------------------------------------------------------------------------------
Household Goods--0.4%
Fort James Corp. 193,500 7,353,000
- ----------------------------------------------------------------------------------
Financial--32.8%
- ----------------------------------------------------------------------------------
Banks--5.6%
BankBoston Corp. 986,000 48,314,000
- ----------------------------------------------------------------------------------
Wells Fargo Co. 1,206,660 52,112,629
------------
100,426,629
- ----------------------------------------------------------------------------------
Diversified Financial--9.0%
Citigroup, Inc. 710,000 53,427,500
- ----------------------------------------------------------------------------------
Countrywide Credit Industries, Inc. 627,500 28,433,594
- ----------------------------------------------------------------------------------
Freddie Mac 752,000 47,188,000
- ----------------------------------------------------------------------------------
Household International, Inc. 600,000 30,187,500
------------
159,236,594
- ----------------------------------------------------------------------------------
Insurance--18.2%
ACE Ltd. 1,735,100 52,486,775
- ----------------------------------------------------------------------------------
AFLAC, Inc. 688,100 37,329,425
- ----------------------------------------------------------------------------------
American International Group, Inc. 132,750 15,589,828
- ----------------------------------------------------------------------------------
Berkshire Hathaway, Inc., Cl. B(1) 5,870 14,498,900
- ----------------------------------------------------------------------------------
Chubb Corp. 612,500 36,290,625
- ----------------------------------------------------------------------------------
Conseco, Inc. 1,397,998 44,124,312
- ----------------------------------------------------------------------------------
Everest Reinsurance Holdings, Inc. 1,300,000 39,406,250
- ----------------------------------------------------------------------------------
NAC Re Corp. 100,000 5,450,000
- ----------------------------------------------------------------------------------
XL Capital Ltd. 1,280,721 77,723,756
------------
322,899,871
</TABLE>
12 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
==================================================================================
<S> <C> <C>
Healthcare--1.4%
- ----------------------------------------------------------------------------------
Healthcare/Supplies & Services--1.4%
Becton, Dickinson & Co. 671,000 $ 24,952,812
- ----------------------------------------------------------------------------------
Technology--8.2%
- ----------------------------------------------------------------------------------
Computer Hardware--1.5%
Compaq Computer Corp. 1,180,000 26,328,750
- ----------------------------------------------------------------------------------
Computer Software--3.5%
Computer Associates International, Inc. 1,440,000 61,470,000
- ----------------------------------------------------------------------------------
Electronics--3.2%
Avnet, Inc. 381,000 16,168,688
- ----------------------------------------------------------------------------------
Motorola, Inc. 500,000 40,062,500
--------------
56,231,188
- ----------------------------------------------------------------------------------
Transportation--4.6%
- ----------------------------------------------------------------------------------
Air Transportation--3.2%
AMR Corp.(1) 824,000 57,525,500
- ----------------------------------------------------------------------------------
Railroads & Truckers--1.4%
Canadian Pacific Ltd. 1,087,500 24,604,688
--------------
Total Common Stocks (Cost $1,275,197,728) 1,713,693,584
<CAPTION>
Face
Amount
==================================================================================
<S> <C> <C>
Short-Term Notes--4.3%(2)
- ----------------------------------------------------------------------------------
Federal National Mortgage Assn., 4.63%, 5/14/99 $16,125,000 16,098,040
- ----------------------------------------------------------------------------------
Ford Motor Credit Co., 4.78%, 5/26/99 20,000,000 19,933,611
- ----------------------------------------------------------------------------------
General Electric Capital Corp., 4.78%, 5/4/99 7,594,000 7,590,975
- ----------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 4.95%, 5/3/99 32,700,000 32,691,008
--------------
Total Short-Term Notes (Cost $76,313,634) 76,313,634
- ----------------------------------------------------------------------------------
Total Investments, at Value (Cost $1,351,511,362) 100.8% 1,790,007,218
- ----------------------------------------------------------------------------------
Liabilities in Excess of Other Assets (0.8) (13,954,135)
---------- --------------
Net Assets 100.0% $1,776,053,083
========== ==============
</TABLE>
1. Non-income producing security.
2. 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, 1999 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
==================================================================================
Assets
Investments, at value (cost $1,351,511,362)--
see accompanying statement $1,790,007,218
- ----------------------------------------------------------------------------------
Cash 104,881
- ----------------------------------------------------------------------------------
Receivables and other assets:
Shares of capital stock sold 3,503,062
Interest and dividends 1,704,759
Investments sold 58,041
Other 15,033
--------------
Total assets 1,795,392,994
==================================================================================
Liabilities
Payables and other liabilities:
Investments purchased 14,698,755
Shares of capital stock redeemed 3,832,280
Distribution and service plan fees 348,611
Transfer and shareholder servicing agent fees 197,453
Directors' compensation--Note 1 94,684
Custodian fees 5,947
Other 162,181
--------------
Total liabilities 19,339,911
==================================================================================
Net Assets $1,776,053,083
==============
==================================================================================
Composition of Net Assets
Par value of shares of capital stock $ 77,653,800
- ----------------------------------------------------------------------------------
Additional paid-in capital 1,209,604,995
- ----------------------------------------------------------------------------------
Undistributed net investment income 664,600
- ----------------------------------------------------------------------------------
Accumulated net realized gain on investment transactions 49,633,832
- ----------------------------------------------------------------------------------
Net unrealized appreciation on investments--Note 3 438,495,856
--------------
Net assets $1,776,053,083
==============
</TABLE>
14 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<S> <C>
==================================================================================
Net Asset Value Per Share
Class A Shares:
Net asset value and redemption price per share (based on net assets
of $1,039,677,429 and 45,130,152 shares of capital stock outstanding) $23.04
Maximum offering price per share (net asset value plus sales charge
of 5.75% of offering price) $24.45
- ----------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net
assets of $573,483,044 and 25,336,366 shares of capital stock
outstanding) $22.63
- ----------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net
assets of $150,095,516 and 6,631,567 shares of capital stock
outstanding) $22.63
- ----------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share
(based on net assets of $12,797,094 and 555,715 shares of capital
stock outstanding) $23.03
</TABLE>
See accompanying Notes to Financial Statements.
15 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statement of Operations For the Six Months Ended April 30, 1999 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
==================================================================================
Investment Income
Dividends (net of foreign withholding taxes of $88,627) $ 9,566,661
- ----------------------------------------------------------------------------------
Interest 6,436,442
------------
Total income 16,003,103
==================================================================================
Expenses
Management fees--Note 4 7,482,307
- ----------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 2,456,398
Class B 2,651,467
Class C 716,506
- ----------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4:
Class A 735,952
Class B 404,973
Class C 107,904
Class Y 8,360
- ----------------------------------------------------------------------------------
Shareholder reports 310,750
- ----------------------------------------------------------------------------------
Directors' compensation--Note 1 95,184
- ----------------------------------------------------------------------------------
Registration and filing fees:
Class A 35,401
Class B 26,216
Class C 5,241
Class Y 950
- ----------------------------------------------------------------------------------
Custodian fees and expenses 25,369
- ----------------------------------------------------------------------------------
Legal, auditing and other professional fees 23,611
- ----------------------------------------------------------------------------------
Other 218,491
------------
Total expenses 15,305,080
Less expenses paid indirectly--Note 4 (1,597)
------------
Net expenses 15,303,483
==================================================================================
Net Investment Income 699,620
==================================================================================
Realized and Unrealized Gain
Net realized gain on investments 49,651,724
- ----------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments 143,108,334
------------
Net realized and unrealized gain 192,760,058
==================================================================================
Net Increase in Net Assets Resulting from Operations $193,459,678
============
</TABLE>
See accompanying Notes to Financial Statements.
16 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended
April 30, 1999 Year Ended
(Unaudited) October 31, 1998
====================================================================================
<S> <C> <C>
Operations
Net investment income $ 699,620 $ 8,974,122
- ------------------------------------------------------------------------------------
Net realized gain 49,651,724 65,256,883
- ------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 143,108,334 25,203,846
-------------- --------------
Net increase in net assets resulting from operations 193,459,678 99,434,851
====================================================================================
Dividends and Distributions to Shareholders
Dividends from net investment income:
Class A (6,772,742) (3,823,240)
Class B (1,685,124) (722,471)
Class C (435,637) (193,326)
Class Y (117,165) (30,052)
- ------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (38,188,457) (30,482,358)
Class B (20,944,460) (13,497,474)
Class C (5,713,902) (3,754,824)
Class Y (407,083) (142,429)
====================================================================================
Capital Stock Transactions
Net increase (decrease) in net assets
resulting from capital stock
transactions--Note 2:
Class A (6,356,569) 244,992,480
Class B 21,816,744 203,694,646
Class C (559,072) 55,117,897
Class Y 1,919,972 6,679,862
====================================================================================
Net Assets
Total increase 136,016,183 557,273,562
- ------------------------------------------------------------------------------------
Beginning of period 1,640,036,900 1,082,763,338
-------------- --------------
End of period (including undistributed net investment
income of $664,600 and $8,975,648, respectively) $1,776,053,083 $1,640,036,900
============== ==============
</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, 1999 Year Ended October 31,
(Unaudited) 1998 1997 1996(2)
=======================================================================================
<S> <C> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of
period $21.46 $20.49 $17.30 $14.51
- ---------------------------------------------------------------------------------------
Income from investment operations:
Net investment income (loss) (.03) .15 .11 .08
Net realized and unrealized gain 2.60 1.80 4.07 3.79
------ ------ ------ ------
Total income from investment
operations 2.57 1.95 4.18 3.87
- ---------------------------------------------------------------------------------------
Dividends and distributions to
shareholders:
Dividends from net investment income (.15) (.11) (.07) (.10)
Distributions from net realized gain (.84) (.87) (.92) (.98)
------ ------ ------ ------
Total dividends and distributions
to shareholders (.99) (.98) (.99) (1.08)
- ---------------------------------------------------------------------------------------
Net asset value, end of period $23.04 $21.46 $20.49 $17.30
====== ====== ====== ======
=======================================================================================
Total Return, at Net Asset Value(4) 12.34% 9.87% 25.41% 28.39%
=======================================================================================
Ratios/Supplemental Data
Net assets, end of period
(in thousands) $1,039,677 $976,655 $699,230 $412,246
- ---------------------------------------------------------------------------------------
Average net assets (in thousands) $ 991,056 $853,061 $560,582 $338,429
- ---------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 0.28%(5) 0.83% 0.74% 0.58%
Expenses(6) 1.63%(5) 1.59% 1.60% 1.71%
- ---------------------------------------------------------------------------------------
Portfolio turnover rate(7) 26% 21% 20% 36%
</TABLE>
1. For the period from December 16, 1996 (inception of offering) to October 31,
1997.
2. On November 22, 1995, OppenheimerFunds, Inc. became the investment advisor to
the Fund.
3. Based on average shares outstanding for the period.
4. Assumes a $1,000 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, 1999 Year Ended October 31,
1995 1994 (Unaudited) 1998 1997 1996(2) 1995 1994
=======================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
$12.59 $12.51 $21.08 $20.17 $17.08 $14.37 $12.53 $12.51
- ---------------------------------------------------------------------------------------
.12(3) .09(3) (.02) .07 .05 .05 .05(3) .02(3)
2.71 .50 2.48 1.76 3.97 3.71 2.69 .50
------ ------ ------ ------ ------ ------ ------ ------
2.83 .59 2.46 1.83 4.02 3.76 2.74 .52
- ---------------------------------------------------------------------------------------
(.08) (.04) (.07) (.05) (.01) (.07) (.07) (.03)
(.83) (.47) (.84) (.87) (.92) (.98) (.83) (.47)
------ ------ ------ ------ ------ ------ ------ ------
(.91) (.51) (.91) (.92) (.93) (1.05) (.90) (.50)
- ---------------------------------------------------------------------------------------
$14.51 $12.59 $22.63 $21.08 $20.17 $17.08 $14.37 $12.53
====== ====== ====== ====== ====== ====== ====== ======
=======================================================================================
24.74% 5.01% 12.00% 9.38% 24.71% 27.76% 24.08% 4.43%
=======================================================================================
$282,615 $238,085 $573,483 $512,885 $298,348 $111,130 $38,557 $14,373
- ---------------------------------------------------------------------------------------
$257,240 $237,923 $535,027 $417,011 $200,752 $ 68,175 $25,393 $ 8,341
- ---------------------------------------------------------------------------------------
0.90% 0.72% (0.22)%(5) 0.33% 0.25% 0.06% 0.36% 0.14%
1.68% 1.71% 2.14%(5) 2.09% 2.10% 2.26% 2.21% 2.24%
- ---------------------------------------------------------------------------------------
36% 49% 26% 21% 20% 36% 36% 49%
</TABLE>
5. Annualized.
6. The expense ratio reflects the effect of expenses paid indirectly by the
Fund.
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, 1999, were $602,042,633 and $382,614,692, respectively.
19 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights (Continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Class C
--------------------------------------
Six Months
Ended
April 30, 1999 Year Ended October 31,
(Unaudited) 1998 1997
======================================================================================
<S> <C> <C> <C>
Per Share Operating Data
Net asset value, beginning of period $21.07 $20.17 $17.07
- --------------------------------------------------------------------------------------
Income from investment operations:
Net investment income (loss) (.03) .07 .05
Net realized and unrealized gain 2.49 1.75 3.98
------ ------ ------
Total income from investment operations 2.46 1.82 4.03
- --------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.06) (.05) (.01)
Distributions from net realized gain (.84) (.87) (.92)
------ ------ ------
Total dividends and distributions to shareholders (.90) (.92) (.93)
- --------------------------------------------------------------------------------------
Net asset value, end of period $22.63 $21.07 $20.17
====== ====== ======
======================================================================================
Total Return, at Net Asset Value(4) 12.03% 9.32% 24.79%
======================================================================================
Ratios/Supplemental Data
Net assets, end of period (in thousands) $150,096 $140,461 $82,098
- --------------------------------------------------------------------------------------
Average net assets (in thousands) $144,543 $116,160 $55,969
- --------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (0.22)%(5) 0.33% 0.25%
Expenses(6) 2.13%(5) 2.10% 2.10%
- --------------------------------------------------------------------------------------
Portfolio turnover rate(7) 26% 21% 20%
</TABLE>
1. For the period from December 16, 1996 (inception of offering) to October 31,
1997.
2. On November 22, 1995, OppenheimerFunds, Inc. became the investment advisor to
the Fund.
3. Based on average shares outstanding for the period.
4. Assumes a $1,000 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
- ------------------------------------ --------------------------------------
Six Months
Ended
April 30, 1999 Year Ended October 31,
1996(2) 1995 1994 (Unaudited) 1998 1997(1)
=================================================================================
<S> <C> <C> <C> <C> <C>
$14.35 $12.52 $12.50 $21.54 $20.55 $16.50
- ---------------------------------------------------------------------------------
.04 .04(3) .01(3) .14 .21 .10
3.71 2.70 .51 2.43 1.83 3.95
------ ------ ------ ------ ------ ------
3.75 2.74 .52 2.57 2.04 4.05
- ---------------------------------------------------------------------------------
(.05) (.08) (.03) (.24) (.18) --
(.98) (.83) (.47) (.84) (.87) --
------ ------ ------ ------ ------ ------
(1.03) (.91) (.50) (1.08) (1.05)
- ---------------------------------------------------------------------------------
$17.07 $14.35 $12.52 $23.03 $21.54 $20.55
====== ====== ====== ====== ====== ======
=================================================================================
27.73% 24.10% 4.45% 12.35% 10.36% 24.55%
=================================================================================
$29,256 $10,140 $3,581 $12,797 $10,036 $3,086
- ---------------------------------------------------------------------------------
$18,099 $ 6,711 $1,725 $11,147 $ 5,673 $1,372
- ---------------------------------------------------------------------------------
0.06% 0.31% 0.09% 0.77%(5) 1.30% 1.20%(5)
2.20% 2.26% 2.28% 1.15%(5) 1.14% 1.19%(5)
- ---------------------------------------------------------------------------------
36% 36% 49% 26% 21% 20%
</TABLE>
5. Annualized.
6. The expense ratio reflects the effect of expenses paid indirectly by the
Fund.
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, 1999, were $602,042,633 and $382,614,692, respectively.
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's investment advisor is OppenheimerFunds, Inc. (the
Manager). 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.
- --------------------------------------------------------------------------------
Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than
those attributable to a specific class), 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.
22 Oppenheimer Quest Value Fund, Inc.
<PAGE>
================================================================================
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.
- --------------------------------------------------------------------------------
Directors' Compensation. The Fund has adopted a nonfunded retirement plan for
the Fund's independent directors. Benefits are based on years of service and
fees paid to each director during the years of service. During the six months
ended April 30, 1999, a provision of $69,879 was made for the Fund's projected
benefit obligations, resulting in an accumulated liability of $94,564 as of
April 30, 1999.
- --------------------------------------------------------------------------------
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, 1999 Year Ended October 31, 1998
------------------------------- -----------------------------
Shares Amount Shares Amount
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 7,838,671 $ 167,206,447 16,583,852 $ 357,559,555
Dividends and
distributions reinvested 2,024,546 43,001,363 1,630,228 32,669,682
Issued in conjunction with the
acquisition of Oppenheimer Quest
Officers Value Fund--Note 6 -- -- 314,171 7,009,162
Redeemed (10,241,602) (216,564,379) (7,150,327) (152,245,919)
----------- ------------- ---------- -------------
Net increase (decrease) (378,385) $ (6,356,569) 11,377,924 $ 244,992,480
=========== ============= ========== =============
- -----------------------------------------------------------------------------------------------------------
Class B:
Sold 4,045,918 $ 84,953,852 11,429,512 $ 243,714,221
Dividends and
distributions reinvested 1,023,777 21,407,161 679,452 13,432,763
Redeemed (4,068,881) (84,544,269) (2,562,176) (53,452,338)
----------- ------------- ---------- -------------
Net increase 1,000,814 $ 21,816,744 9,546,788 $ 203,694,646
=========== ============= ========== =============
- -----------------------------------------------------------------------------------------------------------
Class C:
Sold 1,227,156 $ 25,781,558 3,514,464 $ 74,782,338
Dividends and
distributions reinvested 282,087 5,898,443 192,925 3,812,187
Redeemed (1,543,970) (32,239,073) (1,111,708) (23,476,628)
----------- ------------- ---------- -------------
Net increase (decrease) (34,727) $ (559,072) 2,595,681 $ 55,117,897
=========== ============= ========== =============
- -----------------------------------------------------------------------------------------------------------
Class Y:
Sold 180,328 $ 3,848,661 401,966 $ 8,582,342
Dividends and
distributions reinvested 24,694 524,249 8,611 172,481
Redeemed (115,270) (2,452,938) (94,838) (2,074,961)
----------- ------------- ---------- -------------
Net increase 89,752 $ 1,919,972 315,739 $ 6,679,862
=========== ============= ========== =============
</TABLE>
24 Oppenheimer Quest Value Fund, Inc.
<PAGE>
================================================================================
3. Unrealized Gains and Losses on Investments
As of April 30, 1999, net unrealized appreciation on investments of $438,495,856
was composed of gross appreciation of $485,882,621, and gross depreciation of
$47,386,765.
================================================================================
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 of the Fund, 0.90% of the next $400
million, 0.85% of the next $3.2 billion, 0.80% of the next $4 billion, and 0.75%
of average annual net assets in excess of $8 billion. The Fund's management fee
for the six months ended April 30, 1999, was 0.90% of the average annual net
assets for each class of shares.
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,
1999, the Manager paid $2,419,444 to the Sub-Advisor.
For the six months ended April 30, 1999, commissions (sales
charges paid by investors) on sales of Class A shares totaled $1,415,127, of
which $392,249 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 A, Class B and Class C shares totaled $230,510, $2,276,448 and
$198,019, respectively. Amounts paid to an affiliated broker/dealer for Class B
and Class C shares were $182,672 and $4,701, respectively. During the six months
ended April 30, 1999, OFDI received contingent deferred sales charges of $6,465,
$815,113 and $34,345, respectively, upon redemption of Class A, 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 other Oppenheimer
funds. The Fund pays OFS an annual maintenance fee of $18.00 for each Fund
shareholder account and reimburses OFS for its out-of-pocket expenses. During
the six months ended April 30, 1999, the Fund paid OFS $1,444,112.
Expenses paid indirectly represent a reduction of custodian fees
for earnings on cash balances maintained by the Fund.
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 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 compensate itself for its other expenditures under the Plan.
During the six months ended April 30, 1999, OFDI paid $66,774 to an affiliated
broker/dealer as compensation for Class A personal service and maintenance
expenses and retained $925,564 as compensation for Class A sales commissions and
service fee advances, as well as financing costs.
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 its 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, 1999, OFDI paid $15,062 and $5,762, respectively, to an
affiliated broker/dealer as compensation for Class B and Class C personal
service and maintenance expenses and retained $2,220,638 and $391,084,
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. As of April 30, 1999, OFDI had incurred excess distribution and
servicing costs of $12,560,752 for Class B and $1,391,637 for Class C.
26 Oppenheimer Quest Value Fund, Inc.
<PAGE>
================================================================================
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, 1999.
================================================================================
6. Acquisition of Oppenheimer Quest Officers Value Fund
On June 12, 1998, Oppenheimer Quest Value Fund, Inc. acquired all the net assets
of Oppenheimer Quest Officers Value Fund, pursuant to an agreement and plan of
reorganization approved by the Oppenheimer Quest Officers Value Fund
shareholders on February 18, 1998. The Fund issued (at an exchange ratio of
0.643267 shares of the Fund to one share of Oppenheimer Officers Value Fund)
314,171 shares of capital stock valued at $7,009,162 in exchange for the net
assets of Oppenheimer Quest Officers Value Fund, resulting in combined net
assets of $1,516,410,126 on June 12, 1998. The net assets acquired included net
unrealized appreciation of $1,143,229. The exchange qualified as a tax-free
reorganization for federal income tax purposes.
27 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
Oppenheimer Quest Value Fund, Inc.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
=================================================================================
Officers and Directors Bridget A. Macaskill, Chairman of the Board of Directors
and President
Paul Y. Clinton, Director
Thomas W. Courtney, Director
Robert G. Galli, Director
Lacy B. Herrmann, Director
George Loft, Director
Robert C. Doll, Jr., Vice President
Brian W. Wixted, 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 Citibank, N.A.
Portfolio Securities
=================================================================================
Independent Accountants PricewaterhouseCoopers 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
of 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, are not insured by the FDIC or any other agency,
and involve investment risks, including the possible
loss of the principal amount invested.
</TABLE>
28 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- --------------------------------------------------------------------------------
OppenheimerFunds Family
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
==========================================================================================
Real Asset Funds
- ------------------------------------------------------------------------------------------
Real Asset Fund Gold & Special Minerals Fund
==========================================================================================
Global Stock Funds
- ------------------------------------------------------------------------------------------
Developing Markets Fund International Growth Fund Global Growth & Income Fund
International Small Global Fund Europe Fund
Company Fund Quest Global Value Fund
==========================================================================================
Stock Funds
- ------------------------------------------------------------------------------------------
Enterprise Fund MidCap Fund Growth Fund
Discovery Fund Capital Appreciation Fund Large Cap Growth Fund
Quest Small Cap Value Fund Quest Capital Value Fund Disciplined Value Fund
Quest Value Fund
==========================================================================================
Stock & Bond Funds
- ------------------------------------------------------------------------------------------
Main Street Growth & Total Return Fund Multiple Strategies Fund
Income Fund(1) Quest Balanced Disciplined Allocation Fund
Quest Opportunity Value Fund Convertible Securities Fund
Value Fund Capital Income Fund(2)
==========================================================================================
Taxable Bond Funds
- ------------------------------------------------------------------------------------------
International Bond Fund Champion Income Fund U.S. Government Trust
World Bond Fund Strategic Income Fund Limited-Term Government Fund
High Yield Fund Bond Fund
==========================================================================================
Municipal Bond Funds
- ------------------------------------------------------------------------------------------
California Municipal Fund(3) Pennsylvania Municipal Fund(3) Rochester Division:
Florida Municipal Fund(3) Municipal Bond Fund Rochester Fund Municipals
New Jersey Municipal Fund(3) Insured Municipal Fund Limited Term New York
New York Municipal Fund(3) Intermediate Municipal Fund Municipal Fund
==========================================================================================
Money Market Funds(4)
- ------------------------------------------------------------------------------------------
Money Market Fund Cash Reserves
</TABLE>
1. On 12/22/98, the Fund's name was changed from "Oppenheimer Main Street Income
& Growth Fund."
2. On 4/1/99, the Fund's name was changed from "Oppenheimer Equity Income Fund."
3. Available only to investors in certain states.
4. An investment in money market funds is neither insured nor guaranteed by the
Federal Deposit Insurance Corporation or any other government agency. Although
these funds may seek to preserve the value of your investment at $1.00 per
share, it is possible to lose money by investing in these funds.
Oppenheimer funds are distributed by OppenheimerFunds Distributor, Inc., Two
World Trade Center, New York, NY 10048-0203.
(C) Copyright 1999 OppenheimerFunds, Inc. All rights reserved.
29 Oppenheimer Quest Value Fund, Inc.
<PAGE>
This page purposely left blank.
<PAGE>
Information and Services
As an Oppenheimer fund shareholder, you can benefit from special services
designed to make investing simple. Whether it's automatic investment plans,
timely market updates, or immediate account access, you can count on us whenever
you need assistance. So call us today, or visit our website--we're here to help.
Internet
24-hr access to account information and transactions
www.oppenheimerfunds.com
General Information
Mon-Fri 8:30am-9pm ET, Sat 10am-4pm ET
1-800-525-7048
Telephone Transactions
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[logo]
OppenheimerFunds(R)
Distributor, Inc.
RS0225.001.0499 June 29, 1999
