- --------------------------------------------------------------------------------
T. Rowe Price
- --------------------------------------------------------------------------------
SemiAnnual Report
New Asia Fund
- --------------------------------------------------------------------------------
April 30, 1997
- --------------------------------------------------------------------------------
Report Highlights
================================================================================
* Most Asian markets faltered in recent months, canceling out strong
performance in late 1996; Taiwan was a major exception.
* In general terms, performance was hurt by downward revisions for export
growth and corporate earnings.
* The New Asia Fund's small negative return was better than that of the MSCI
All Country Far East Free Ex-Japan Index but trailed the modest but
positive return of the Lipper Pacific Ex-Japan Funds Average.
* Hong Kong remains the fund's largest position, and we are optimistic about
its future after the fast-approaching handover to China.
* The Asian region is suffering from maturity pains; however, encouraging
signs of adjustment brought about by recent deflationary forces should bear
fruit in the long run.
- --------------------------------------------------------------------------------
Fellow Shareholders
================================================================================
After a strong finish in 1996, Asian equity markets got off to a dismal
start in 1997. As usual the performance of the various Asian markets was far
from homogeneous, with Taiwan rocketing skyward, Hong Kong steady after
correcting from late 1996 highs, but most other markets depressingly weak.
Two themes in particular have become increasingly prevalent across the
region. First, the gloss has come off the "Asian Growth Miracle" story as
forecasts for growth in exports and corporate earnings are revised lower in most
markets. Second, investor sentiment has been damaged by concerns over the
sustainability of Asian property prices driven ever-higher by the feverish pace
of credit expansion.
<PAGE>
- --------------------------------------------------------------------------------
Performance Comparison
================================================================================
Periods Ended 4/30/97 6 months 12 months
- --------------------- --------- ----------
New Asia Fund -0.64% -7.09%
MSCI All Country Far East Free
Ex-Japan Index -1.45 -7.52
Lipper Pacific Ex-Japan
Funds Average 2.35 -3.38
================================================================================
Against a difficult backdrop, the fund produced a disappointing return of
- -0.64% for the six months ended April 30. This compared favorably with a return
of -1.45% for the MSCI benchmark index (shown in the table) but trailed the
2.35% gain of the average competitor fund. The same pattern of relative
performance prevailed for the 12-month period. The result for the six-month
period was particularly disappointing in light of our increasingly cautious view
of the markets late in 1996. Accordingly, we had sought to take some defensive
action within the portfolio while remaining fully invested.
Portfolio Review
Hong Kong, which remains our largest position at 35% of net assets, was one
of the few markets in the region to record positive performance for the 12-month
period, and we have maintained an overweighted position here versus the index
throughout this period. With the hand-over to China now only weeks away, we
remain convinced that local pragmatism will continue to prevail even if outside
observers choose to focus on some potentially destabilizing issues. In recent
months the impact of stock selection in this market was negative for the fund,
with several of our larger non-index holdings (Hong Kong Land Holdings, Guoco
Group, and First Pacific) underperforming sharply as the market suffered a 10%
correction. A number of volatile property and China-related holdings (Henderson
Land, Guangdong Investments, Guangzhou Investments) were sold into market
strength during December and January. Since then, however, local speculative
interest in so-called "China Red Chips" has remained intense.
================================================================================
<PAGE>
Market Performance
(In U.S. Dollar Terms)
Periods Ended 4/30/97 6 Months 12 Months
--------------------- --------- ---------
Hong Kong -0.22% 10.16%
Indonesia 7.77 0.34
Malaysia -6.41 -7.23
Philippines -5.79 -6.50
Singapore -6.64 -21.99
South Korea -12.85 -42.50
Taiwan 25.49 31.10
Thailand -25.81 -49.99
Source: FAME Information Services, Inc.; using MSCI indices.
================================================================================
We have recently been more active in Taiwan, building positions in a number
of companies in the electronics sector, including Compeq Manufacturing. Despite
the increased exposure, our 5% position remains significantly underweighted in
what remains a liquidity-driven market offering precious little value at 27
times average 1997 earnings.
In Malaysia, we took advantage of buoyant market conditions around year-end
to trim holdings of expensive financial companies such as Affin Holdings and
Arab Malaysian Finance, thereby maintaining a modestly underweighted market
exposure at about 18% of net assets. In recent months, confidence in the
Malaysian equity market has been severely shaken due to fears over the effect an
impending downturn in the property market might have on local banks. This has
hurt both the absolute and relative performance of the fund. Similarly, recent
nervousness in Singapore, driven by a lack of improvement in export performance,
has resulted in sharp declines for many of our core blue chip holdings, such as
Fraser & Neave, City Developments, and United Overseas Bank. In anticipation of
turbulent times for Asian markets during the first half of 1997, we had been
attracted to Singapore's traditional safe-haven status and had increased
exposure to an overweighted position--a tactical move that, for the moment, has
gone against us.
[edgar description: pie chart showing Brazil 47%, Mexico 20%, Argentina 12%,
Chile 7%, Peru 1%, Venezuela 1%, and Other and Reserves 12%)
Across the smaller markets throughout the region, we were generally
cautious, maintaining moderate positions focused on a small number of core,
defensive holdings. In Thailand, the weakest Pacific Rim market in the past 12
months, we were early to cut back on the bank sector last year, and we have not
changed our significantly underweighted market exposure to this country. In
Indonesia and the Philippines, we further reduced already modest positions by
selling non-core holdings, while in South Korea more stable market conditions
recently gave us the opportunity to weed out a number of financial holdings.
India is one small but promising market where we have been able to find
attractive growth companies, and we have been gradually taking exposure to 3% of
net assets.
<PAGE>
- --------------------------------------------------------------------------------
Outlook
================================================================================
The Asian region is suffering from maturity pains. Although still the envy
of most established Western countries, the region's economic growth is slowing
and corporate earnings are being squeezed. After a decade of low real interest
rates, easy credit, and rapid asset inflation, Asia's structural deficiencies
are being exposed by a severe bout of cyclical deflationary forces.
================================================================================
Industry Diversification
- --------------------------------------------------------------------------------
Percent of Percent of
Net Assets Net Assets
10/31/96 4/30/97
-------- -------
Finance 49.3% 43.5%
Services 14.0 16.6
Multi-industry 12.2 13.3
Energy 5.9 8.8
Materials 6.5 4.4
Capital Equipment 3.3 4.0
Consumer Goods 3.7 4.0
All Other 0.3 -
Reserves 4.8 5.4
Total 100.0% 100.0%
================================================================================
Nevertheless, now would be the wrong time to write off Asia. Monetary
reflation is already selectively in place, and an expected rebound in export
growth in the second half of 1997 would provide some cyclical relief.
Increasingly, competitive conditions and excess production capacity in Asia
ensure that any pickup will fall far short of previous typical Asian booms.
However, the current turmoil and pain should encourage a more realistic approach
to Asia's structural problems. This would include a much needed unwinding of
asset inflation excesses, deep cutbacks in investment, and a better allocation
of scarce capital resources. As a result, companies would be more efficient,
more transparent in structure, and more focused on returns to shareholders. All
of this would be good for profit margins, earnings, return on equity, and
valuations. After all, in what is an increasingly global economy, it would only
be expected that the wave of restructuring that has so transformed corporate
America should sooner or later find its way into the Asian region. The potential
upside could be substantial.
Respectfully submitted,
/s/Martin G.Wade
Martin G. Wade
President
May 19, 1997
<PAGE>
================================================================================
Portfolio Highlights
TWENTY-FIVE LARGEST HOLDINGS
Percent of
Net Assets
4/30/97
-------
Hutchison Whampoa, Hong Kong ................................... 4.6%
United Overseas Bank, Singapore ................................ 3.2
HSBC Holdings, Hong Kong ....................................... 3.0
Dao Heng Bank Group, Hong Kong ................................. 2.5
Swire Pacific, Hong Kong ....................................... 2.4
Cheung Kong Holdings, Hong Kong ................................ 2.4
Huaneng Power International, China ............................. 2.3
Hong Kong Land Holdings, Hong Kong ............................. 2.3
Guoco Group, Hong Kong ......................................... 2.3
New World Development, Hong Kong ............................... 2.3
Singapore Press, Singapore ..................................... 2.2
United Engineers, Malaysia ..................................... 2.2
Tanjong, Malaysia .............................................. 2.1
Renong, Malaysia ............................................... 1.9
Tenaga Nasional, Malaysia ...................................... 1.6
Korea Electric Power, South Korea .............................. 1.6
Hong Kong Telecommunications, Hong Kong ........................ 1.6
Overseas Union Bank, Singapore ................................. 1.6
First Pacific, Hong Kong ....................................... 1.4
DBS Land, Singapore ............................................ 1.4
Magnum, Malaysia ............................................... 1.4
Samsung Electronic, South Korea ................................ 1.3
Time Engineering, Malaysia ..................................... 1.2
Development Bank of Singapore, Singapore ....................... 1.2
Singapore Land, Singapore ...................................... 1.2
Total .......................................................... 51.2%
================================================================================
<PAGE>
T. Rowe Price New Asia Fund
Performance Comparison
This chart shows the value of a hypothetical $10,000 investment in the fund over
the past 10 fiscal year periods or since inception (for funds lacking 10-year
records). The result is compared with a broad-based average or index. The index
return does not reflect expenses, which have been deducted from the fund's
return.
[edgar description: SEC chart showing 5 years of MSCI EMF Latin America Index,
Lipper Latin America Funds Average, Latin America Fund)
Average Annual Compound Total Return
This table shows how the fund would have performed each year if its actual (or
cumulative) returns for the periods shown had been earned at a constant rate.
Since Inception
Periods Ended 4/30/97 1 Year 3 Years 5 Years Inception Date
- --------------------- ------ ------- ------- --------- ----
New Asia Fund -7.09% 1.30% 10.06% 12.02% 9/28/90
Investment return and principal value represent past performance and will
vary. Shares may be worth more or less at redemption than at original purchase.
================================================================================
T. Rowe Price New Asia Fund
Unaudited
For a share outstanding throughout each period #
================================================================================
<PAGE>
<TABLE>
Financial Highlights
<S> <C> <C> <C> <C> <C> <C> <C>
6 Months Year 10 Months Year
Ended Ended Ended Ended
4/30/97 10/31/96 10/31/95 10/31/94 10/31/93 12/31/92 12/31/91
NET ASSET VALUE
Beginning of period ....... $ 8.64 $ 8.12 $ 10.07 $ 9.88 $ 6.34 $ 5.91 $ 5.04
Investment activities
Net investment income 0.02 0.06 0.08 0.06 0.03 0.10 0.10*
Net realized and
unrealized gain (loss) (0.07) 0.55 (1.07) 0.36 3.51 0.56 0.87
Total from
investment activities (0.05) 0.61 (0.99) 0.42 3.54 0.66 0.97
Distributions
Net investment income (0.06) (0.09) (0.07) (0.04) -- (0.10) (0.10)
Net realized gain .... (0.01) -- (0.89) (0.19) -- (0.13) --
Total distributions .. (0.07) (0.09) (0.96) (0.23) -- (0.23) (0.10)
NET ASSET VALUE
End of period ............ $ 8.52 $ 8.64 $ 8.12 $ 10.07 $ 9.88 $ 6.34 $ 5.91
Ratios/Supplemental Data
Total return ............. (0.64)% 7.58% (9.70)% 4.11% 55.84% 11.24% 19.32%*
Ratio of expenses to
average net assets ....... 1.08%+ 1.11% 1.15% 1.22% 1.29%+ 1.51% 1.75%*
Ratio of net investment
income to average
net assets ............... 0.49%+ 0.66% 0.97% 0.85% 1.02%+ 1.64% 1.75%*
Portfolio turnover rate .. 44.7%+ 42.0% 63.7% 63.2% 40.4%+ 36.3% 49.0%
Average commission
rate paid ................ $ 0.0070 $ 0.0057 $ -- $ -- $ -- $ -- $ --
Net assets, end of period
(in millions) ............ $ 1,858 $ 2,041 $ 1,909 $ 2,303 $ 1,650 $ 315 $ 103
*Excludes expenses in excess of a 1.75% voluntary expense limitation in effect through 12/31/92.
+ Annualized.
++ The fund's fiscal year end was changed to 10/31.
#All per share figures reflect the 2-for-1 stock split effective 5/27/94.
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
================================================================================
<PAGE>
Unaudited April 30, 1997
Portfolio of Investments
Shares/Par Value
---------- -----
In thousands
China 4.1%
Common Stocks 4.1%
China North Industries Investment (USD) ........... 3,998,000 $ 1,619
Guangdong Electric Power (Class B) (HKD) .......... 15,513,000 17,443
Huaneng Power International (Class N) ADR (USD) * . 1,793,040 43,481
Jilin Chemical Industrial (HKD) * ................. 11,484,000 1,705
Shanghai Petrochemical (Class H) (HKD) ............ 23,386,000 5,796
Shenzhen Expressway (Class H) (HKD) * ............. 10,830,000 3,565
Yizheng Chemical Fibre (Class H) (HKD) ............ 13,098,000 2,570
76,179
Convertible Bonds 0.0%
Qingling Motors, 3.50%, 1/22/02 USD................ 750,000 735
735
Total China (Cost $60,002) 76,914
HONG KONG 35.2%
Common Stocks and Warrants 35.2%
Amway Asia Pacific (USD) .......................... 155,000 6,510
CDL Hotels International .......................... 10,326,363 4,499
Cathay Pacific Airways ............................ 6,850,000 10,656
Cheung Kong Holdings .............................. 5,031,000 44,163
Cheung Kong Infrastructure * ...................... 2,684,000 7,605
China Light & Power ............................... 3,000,000 13,516
Dao Heng Bank Group ............................... 9,868,260 46,880
Dickson Concepts International .................... 1,039,000 3,836
Esprit Asia ....................................... 14,390,000 6,595
Fairyoung Holdings * .............................. 4,087,000 1,728
First Pacific ..................................... 22,207,149 26,517
Great Eagle Holdings .............................. 3,069,275 9,172
Guoco Group ....................................... 9,114,000 43,296
HKR International ................................. 8,576,440 10,573
HSBC Holdings ..................................... 2,209,903 55,914
Hon Kwok Land Investment .......................... 10,979,760 3,685
Hong Kong & Shanghai Hotels ....................... 3,210,998 4,663
Hong Kong & Shanghai Hotels, Warrants, 12/10/98 * . 274,998 37
Hong Kong Land Holdings (USD) ..................... 20,900,950 43,474
Hong Kong Telecommunications ...................... 17,163,527 29,468
Hopewell Holdings ................................. 20,000,000 10,392
Hutchison Whampoa ................................. 11,503,000 85,383
Hysan Development ................................. 7,665,000 21,175
Jardine International Motor Holdings .............. 4,514,000 5,244
Lai Sun Development ............................... 3,250,000 3,965
Lai Sun Hotels International, Warrants, 4/30/99 * . 652,286 62
National Mutual Asia .............................. 8,242,000 8,512
New World Development ............................. 7,291,934 42,077
New World Infrastructure * ........................ 2,783,000 7,868
Oriental Press Group .............................. 1,688,000 632
Shangri-La Asia ................................... 4,774,000 5,947
Smartone Telecommunications *..................... 2,893,000 5,527
South China Morning Post .......................... 5,896,000 5,061
Sun Hung Kai Properties ........................... 1,000,000 10,844
Swire Pacific (Class A) ........................... 5,834,000 44,999
Wharf Holdings .................................... 3,920,000 14,827
Wheelock .......................................... 1,563,000 3,249
Wing Hang Bank .................................... 1,557,000 5,688
Total Hong Kong (Cost $573,669) 654,239
<PAGE>
INDIA 3.0%
Common Stocks 3.0%
Gujarat Ambuja Cement GDR (USD) ................... 354,000 3,584
Hindalco GDR (USD) ................................ 368,500 11,976
Hindustan Lever ................................... 137,500 4,230
Hindustan Petroleum ............................... 293,500 3,427
Housing Development Finance ....................... 11,900 1,063
Industrial Credit & Investment Corporation of India 2,557,050 4,166
Mahanagar Telephone ............................... 2,250,000 18,671
Reliance Industries GDS (USD) * ................... 100,000 2,000
State Bank of India ............................... 312,000 2,805
Tata Engineering & Locomotive ..................... 164,300 1,865
Tata Engineering & Locomotive GDR (USD) ........... 124,800 1,576
Total India (Cost $44,668) 55,363
INDONESIA 2.2%
Common Stocks, Rights, and Warrants 2.2%
Bank Dagang Nasional .............................. 5,174,687 5,164
Bank Dagang Nasional, Warrants, 2/14/00 * ......... 1,167,812 408
Indofoods Sukses Makmur * ......................... 639,600 $ 1,323
Indofoods Sukses Makmur, Rights, 6/4/97 * ......... 205,620 121
Indorama Synthetic * .............................. 248,000 186
Indosat ........................................... 2,485,500 6,853
Kalbe Farma ....................................... 788,000 778
Semen Gresik ...................................... 2,305,000 5,620
Telekom Indonesia (Class B) ....................... 7,094,000 10,291
Telekom Indonesia (Class B) ADS (USD) ............. 382,000 10,887
Total Indonesia (Cost $38,636) 41,631
MALAYSIA 18.1%
Common Stocks and Rights 17.5%
Affin Holdings .................................... 4,200,000 10,120
Arab Malaysian Finance ............................ 5,720,666 12,531
Arab Malaysian Finance, Rights, 5/9/97 * .......... 7,925,243 16
Berjaya Sports Toto ............................... 2,551,499 12,195
Commerce Asset Holdings ........................... 1,300,000 7,767
Hong Leong Credit ................................. 462,000 2,392
Hume Industries ................................... 486,000 2,594
Land & General .................................... 1,517,000 2,066
MBF Capital ....................................... 10,327,000 15,301
MNI Holdings ...................................... 1,387,000 6,629
Magnum ............................................ 15,866,000 25,150
Malaysian Assurance Alliance ...................... 1,236,375 6,648
Multi-Purpose Holdings ............................ 7,500,000 12,247
Phileo Allied ..................................... 5,844,000 11,638
Phileo Land * ..................................... 940,000 2,527
Public Finance .................................... 3,300,000 5,047
Renong ............................................ 23,550,000 32,265
Resorts World ..................................... 5,413,000 19,942
Sime Darby ........................................ 790,000 2,439
Tanjong ........................................... 10,570,000 38,309
Technology Resources Industries * ................. 2,464,000 4,514
Tenaga Nasional ................................... 6,522,000 30,132
Time Engineering .................................. 12,470,000 22,846
United Engineers .................................. 5,665,698 40,166
<PAGE>
325,481
Preferred Stocks 0.5%
Arab Malaysian Finance,Cv. Loan Stock,7.50%,11/20/99 6,962,333 4,742
Multi-Purpose Holdings,Cv. Loan Stock,3.00%,1/13/02 7,098,000 $ 2,643
Renong, Cv. Loan Stock, 4.00%, 5/21/01 ............ 4,630,000 1,641
9,026
Convertible Bonds 0.1%
Renong, 2.50%, 1/15/05 USD........................ 800,000 910
910
Total Malaysia (Cost $335,740) 335,417
PHILIPPINES 3.7%
Common Stocks 3.7%
Ayala Land (Class B) .............................. 14,330,468 10,325
Bank of the Philippine Islands .................... 749,400 4,035
Enron Global Power & Pipeline (USD) ............... 235,000 6,933
Philippine Long Distance Telephone ................ 57,600 3,287
Philippine Long Distance Telephone ADS (USD) ...... 276,100 15,393
Philippine National Bank * ........................ 1,107,796 7,268
San Miguel (Class B) .............................. 2,641,500 7,613
Southeast Asia Cement * ........................... 183,529,340 8,491
Universal Robina .................................. 13,625,000 5,012
Total Philippines (Cost $89,708) 68,357
SINGAPORE 15.0%
Common Stocks and Warrants 15.0%
Bukit Sembawang Estates ........................... 225,000 4,632
City Developments ................................. 2,254,000 18,219
DBS Land .......................................... 8,063,000 26,069
Development Bank of Singapore ..................... 1,899,000 22,565
Fraser & Neave .................................... 1,371,800 9,951
Keppel ............................................ 1,389,000 6,046
Keppel (Class A), New * ........................... 347,250 1,480
Keppel Land ....................................... 2,096,000 5,387
Keppel Land, Warrants, 12/12/00 * ................. 325,000 274
Mandarin Oriental (USD) ........................... 3,111,512 3,609
Overseas Chinese Bank ............................. 1,423,000 16,614
Overseas Union Bank ............................... 4,430,000 29,074
Singapore Land .................................... 4,640,000 21,637
Singapore Press ................................... 2,246,560 41,594
United Industrial ................................. 8,717,000 6,564
United Overseas Bank .............................. 6,155,500 $ 57,834
United Overseas Bank, Warrants, 6/17/97 * ......... 291,208 1,002
Wing Tai Holdings ................................. 2,602,000 6,723
Total Singapore (Cost $291,143) 279,274
<PAGE>
SOUTH KOREA 5.5%
Common Stocks 5.5%
Cho Hung Bank ..................................... 906,000 4,945
Daewoo Securities * ............................... 166,260 1,603
Hanil Bank ........................................ 248,000 1,362
Hanil Securities * ................................ 436,700 2,360
Housing & Commercial Bank ......................... 450,430 8,787
Kook Min Bank ..................................... 585,129 11,204
Korea Electric Power .............................. 1,009,000 30,089
Korea Growth Trust IDR (USD) * .................... 40 900
Korea Mobile Telecommunications ADS (USD) *........ 180,000 1,710
Pohang Iron & Steel ............................... 143,640 10,444
Samsung Electronic ................................ 292,064 24,009
Shinhan Bank ...................................... 245,591 3,731
Total South Korea (Cost $142,403) 101,144
TAIWAN 5.1%
Common Stocks 5.1%
Cathay Construction ............................... 1,514,000 2,655
China Steel ....................................... 4,629,000 4,953
China Trust Commercial Bank * ..................... 5,614,432 10,555
Compeq Manufacturing .............................. 1,729,000 12,314
Delpha Construction * ............................. 2,073,000 3,163
Lite-On Technology ................................ 1,335,000 4,006
Macronix International * .......................... 2,010,000 3,924
Taichung Business Bank * .......................... 5,796,000 12,573
The Taiwan Fund (USD) ............................. 563,000 14,145
Tong Lung Metal * ................................. 2,600,000 4,437
Yageo * ........................................... 4,313,800 15,206
Yageo GDR (USD) * ................................. 162,400 2,843
Yieh Phui Enterprise * ............................ 2,940,000 4,294
Total Taiwan (Cost $76,934) 95,068
THAILAND 2.6%
Common Stocks 2.6%
Advanced Information Service ...................... 250,000 $ 1,665
Bangkok Bank ...................................... 1,226,500 11,362
Central Pattana ................................... 674,100 2,323
PTT Exploration & Production * .................... 1,064,500 13,611
Siam Cement ....................................... 180,300 4,831
Thai Farmers Bank ................................. 848,020 5,129
Total Access Communications (USD) ................. 1,673,000 8,616
Total Thailand (Cost $53,100) 47,537
<PAGE>
VIETNAM 0.1%
Common Stocks 0.1%
Lazard Vietnam Fund Limited (USD) * ............... 152,800 1,375
Total Vietnam (Cost $1,578)
1,375
SHORT-TERM INVESTMENTS 2.6%
Commercial Paper 2.6%
France Telecom, 5.50%, 5/16/97 .................... $17,650,000 17,610
National Australia Funding, 5.50%, 5/21/97 ........ 20,000,000 19,939
Investments in Commercial Paper through a Joint Account,
5.60%, 5/1/97 ..................................... 11,437,376 11,437
Total Short-Term Investments (Cost $48,986) 48,986
Total Investments in Securities
97.2% of Net Assets (Cost $1,756,567) $ 1,805,305
Other Assets Less Liabilities 52,269
NET ASSETS $ 1,857,574
NET ASSET VALUE PER SHARE $ 8.52
* Non-income producing
+ Affiliated company
HKD Hong Kong dollar
USD U.S. dollar
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
Unaudited April 30, 1997
Statement of Assets and Liabilities
In thousands
Assets
Investments in securities, at value (cost $1,756,567) ....... $1,805,305
Other assets ................................................ 82,947
Total assets ................................................ 1,888,252
Liabilities
Total liabilities ........................................... 30,678
NET ASSETS .................................................. $1,857,574
Net Assets Consist of:
Accumulated net investment income - net of distributions .... $ 1,947
Accumulated net realized gain/loss - net of distributions ... 21,943
Net unrealized gain (loss) .................................. 48,011
Paid-in-capital applicable to 218,116,010 shares of
$0.01 par value capital stock outstanding;
2,000,000,000 shares of the Corporation authorized .......... 1,785,673
NET ASSETS .................................................. $1,857,574
NET ASSET VALUE PER SHARE ................................... $ 8.52
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
Unaudited
Statement of Operations
In thousands
6 Months
Ended
4/30/97
-------
Investment Income
Income
Dividend (net of foreign taxes of $ 1,242) ....................... $ 14,583
Interest ......................................................... 1,936
Total income ..................................................... 16,519
Expenses
Investment management ............................................ 8,711
Shareholder servicing ............................................ 2,048
Custody and accounting ........................................... 382
Prospectus and shareholder reports ............................... 109
Registration ..................................................... 84
Legal and audit .................................................. 8
Directors ........................................................ 6
Miscellaneous .................................................... 7
Total expenses ................................................... 11,355
Net investment income ............................................ 5,164
Realized and Unrealized Gain (Loss)
Net realized gain (loss)
Securities (including ($9,904) from affiliated companies) ........ 66,555
Foreign currency transactions .................................... (1,039)
Net realized gain (loss) ......................................... 65,516
Change in net unrealized gain or loss
Securities ....................................................... (70,429)
Other assets and liabilities
denominated in foreign currencies ................................ 20
Change in net unrealized gain or loss ............................ (70,409)
Net realized and unrealized gain (loss) .......................... (4,893)
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS ........................................... $ 271
========
The accompanying notes are an integral part of these financial statements.
================================================================================
<PAGE>
Unaudited
Statement of Changes in Net Assets
In thousands
6 Months Year
Ended Ended
4/30/97 10/31/96
------- --------
Increase (Decrease) in Net Assets
Operations
Net investment income ...............................$ 5,164 $ 14,185
Net realized gain (loss) ............................ 65,516 (214)
Change in net unrealized gain or loss ............... (70,409) 118,431
Increase (decrease) in net assets from operations ... 271 132,402
Distributions to shareholders
Net investment income ............................... (14,114) (20,404)
Net realized gain ................................... (2,352) --
Decrease in net assets from distributions ........... (16,466) (20,404)
Capital share transactions *
Shares sold ......................................... 424,510 861,270
Distributions reinvested ............................ 15,534 19,209
Shares redeemed ..................................... (607,671) (859,974)
Increase (decrease) in net assets from capital
share transactions .................................. (167,627) 20,505
Net Assets
Increase (decrease) during period ................... (183,822) 132,503
Beginning of period ................................. 2,041,396 1,908,893
End of period .......................................$ 1,857,574 $ 2,041,396
*Share information
Shares sold ......................................... 46,078 97,874
Distributions reinvested ............................ 1,696 2,351
Shares redeemed ..................................... (65,927) (99,089)
Increase (decrease) in shares outstanding ........... (18,153) 1,136
The accompanying notes are an integral part of these financial statements
================================================================================
<PAGE>
Unaudited April 30, 1997
Notes to Financial Statements
- --------------------------------------------------------------------------------
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
================================================================================
T. Rowe Price International Funds, Inc. (the corporation) is registered
under the Investment Company Act of 1940. The New Asia Fund (the fund), a
diversified, open-end management investment company, is one of the portfolios
established by the corporation and commenced operations on September 28, 1990.
Valuation Equity securities are valued at the last quoted sales price at
the time the valuations are made. A security which is listed or traded on more
than one exchange is valued at the quotation on the exchange determined to be
the primary market for such security.
Debt securities are generally traded in the over-the-counter market and are
valued at a price deemed best to reflect fair value as quoted by dealers who
make markets in these securities or by an independent pricing service.
Short-term debt securities are valued at amortized cost which approximates fair
value.
For purposes of determining the fund's net asset value per share, the U.S.
dollar value of all assets and liabilities initially expressed in foreign
currencies is determined by using the mean of the bid and offer prices of such
currencies against U.S. dollars quoted by a major bank.
Assets and liabilities for which the above valuation procedures are
inappropriate or are deemed not to reflect fair value are stated at fair value
as determined in good faith by or under the supervision of the officers of the
fund, as authorized by the Board of Directors.
Affiliated Companies Investments in companies 5% or more of whose
outstanding voting securities are held by the fund are defined as "Affiliated
Companies" in Section 2(a)(3) of the Investment Company Act of 1940.
Currency Translation Assets and liabilities are translated into U.S.
dollars at the prevailing exchange rate at the end of the reporting period.
Purchases and sales of securities and income and expenses are translated into
U.S. dollars at the prevailing exchange rate on the dates of such transactions.
The effect of changes in foreign exchange rates on realized and unrealized
security gains and losses is reflected as a component of such gains and losses.
Other Income and expenses are recorded on the accrual basis. Investment
transactions are accounted for on the trade date. Realized gains and losses are
reported on the identified cost basis. Dividend income and distributions to
shareholders are recorded by the fund on the ex-dividend date. Income and
capital gain distributions are determined in accordance with federal income tax
regulations and may differ from those determined in accordance with generally
accepted accounting principles.
<PAGE>
- --------------------------------------------------------------------------------
NOTE 2 - INVESTMENT TRANSACTIONS
================================================================================
Consistent with its investment objective, the fund engages in the following
practices to manage exposure to certain risks or enhance performance. The
investment objective, policies, program, and risk factors of the fund are
described more fully in the fund's prospectus and Statement of Additional
Information.
Emerging Markets At April 30, 1997, the fund held investments in securities
of companies located in emerging markets. Future economic or political
developments could adversely affect the liquidity or value, or both, of such
securities.
Commercial Paper Joint Account The fund, and other affiliated funds, may
transfer uninvested cash into a commercial paper joint account, the daily
aggregate balance of which is invested in high-grade commercial paper. All
securities purchased by the joint account satisfy the fund's criteria as to
quality, yield, and liquidity.
Securities Lending The fund lends its securities to approved brokers to
earn additional income and takes cash and U.S. Treasury securities as collateral
to secure the loans. Collateral is maintained at not less than 100% of the value
of loaned securities. At April 30, 1997, the value of securities on loan was
$83,365,000. Although the risk is mitigated by the collateral, the fund could
experience a delay in recovering its securities and a possible loss of income or
value if the borrower fails to return them.
Other Purchases and sales of portfolio securities, other than short-term
securities, aggregated $447,750,000 and $632,942,000, respectively, for the six
months ended April 30, 1997.
- --------------------------------------------------------------------------------
NOTE 3 - FEDERAL INCOME TAXES
================================================================================
No provision for federal income taxes is required since the fund intends to
continue to qualify as a regulated investment company and distribute all of its
taxable income. The fund has unused realized capital loss carryforwards for
federal income tax purposes of $39,472,000 which expire in 2003. The fund
intends to retain gains realized in future periods that may be offset by
available capital loss carryforwards.
At April 30, 1997, the aggregate cost of investments for federal income tax
and financial reporting purposes was $1,756,567,000, and net unrealized gain
aggregated $48,738,000, of which $207,173,000 related to appreciated investments
and $158,435,000 to depreciated investments.
<PAGE>
- --------------------------------------------------------------------------------
NOTE 4 - RELATED PARTY TRANSACTIONS
================================================================================
The fund is managed by Rowe Price-Fleming International, Inc. (the
manager), which is owned by T. Rowe Price Associates, Inc. (Price Associates),
Robert Fleming Holdings Limited, and Jardine Fleming Holdings Limited under a
joint venture agreement.
The investment management agreement between the fund and the manager
provides for an annual investment management fee, of which $1,297,000 was
payable at April 30, 1997. The fee is computed daily and paid monthly, and
consists of an individual fund fee equal to 0.50% of average daily net assets
and a group fee. The group fee is based on the combined assets of certain mutual
funds sponsored by the manager or Price Associates (the group). The group fee
rate ranges from 0.48% for the first $1 billion of assets to 0.30% for assets in
excess of $80 billion. At April 30, 1997, and for the six months then ended, the
effective annual group fee rate was 0.33%. The fund pays a pro-rata share of the
group fee based on the ratio of its net assets to those of the group.
In addition, the fund has entered into agreements with Price Associates and
two wholly owned subsidiaries of Price Associates, pursuant to which the fund
receives certain other services. Price Associates computes the daily share price
and maintains the financial records of the fund. T. Rowe Price Services, Inc.
(TRPS) is the fund's transfer and dividend disbursing agent and provides
shareholder and administrative services to the fund. T. Rowe Price Retirement
Plan Services, Inc., provides subaccounting and recordkeeping services for
certain retirement accounts invested in the fund. Additionally, the fund is one
of several T. Rowe Price mutual funds (the underlying funds) in which the T.
Rowe Price Spectrum International Fund (Spectrum) invests. In accordance with an
agreement among Spectrum, the underlying funds, Price Associates and TRPS,
expenses from the operation of Spectrum are borne by the underlying funds based
on each underlying fund's proportionate share of assets owned by Spectrum. The
fund incurred expenses pursuant to these related party agreements totaling
approximately $1,597,000 for the six months ended April 30, 1997, of which
$339,000 was payable at period-end.
During the six months ended April 30, 1997, the fund, in the ordinary
course of business, placed security purchase and sale orders aggregating
$132,496,000 with certain affiliates of the manager and paid commissions of
$569,000 related thereto.
================================================================================
<PAGE>
T. Rowe Price Shareholder Services
Investment Services And Information
KNOWLEDGEABLE SERVICE REPRESENTATIVES
By Phone 1-800-225-5132 Available Monday through Friday from
8 a.m. to 10 p.m. ET and weekends from 8:30 a.m. to 5 p.m. ET.
In Person Available in T. Rowe Price Investor Centers.
ACCOUNT SERVICES
Checking Available on most fixed income funds ($500 minimum).
Automatic Investing From your bank account or paycheck.
Automatic Withdrawal Scheduled, automatic redemptions.
Distribution Options Reinvest all, some, or none of your distributions.
Automated 24-Hour Services Including Tele*Access (Registration Mark) and
T. Rowe Price OnLine.
Discount Brokerage*
Individual Investments Stocks, bonds, options, precious metals, and other
securities at a savings over regular commission rates.
Investment Information
Combined Statement Overview of your T. Rowe Price accounts.
Shareholder Reports Fund managers' reviews of their strategies
and results.
T. Rowe Price Report Quarterly investment newsletter
discussing markets and financial strategies.
Performance Update Quarterly review of all T. Rowe Price fund results.
Insights Educational reports on investment strategies and financial markets.
Investment Guides Asset Mix Worksheet, College Planning Kit,
Diversifying Overseas: A Guide to International Investing,
Personal
Strategy Planner, Retirees Financial Guide, and Retirement Planning Kit.
* A division of T. Rowe Price Investment Services, Inc. Member NASD/SIPC.
================================================================================
<PAGE>
For yield, price, last transaction,
current balance, or to conduct
transactions, 24 hours, 7 days
a week, call Tele*Access (Registration Mark):
1-800-638-2587 toll free
For assistance
with your existing
fund account, call:
Shareholder Service Center
1-800-225-5132 toll free
410-625-6500 Baltimore area
To open a Discount Brokerage
account or obtain information,
call: 1-800-638-5660 toll free
Internet address:
www.troweprice.com
T. Rowe Price Associates
100 East Pratt Street
Baltimore, Maryland 21202
This report is authorized for
distribution only to shareholders
and to others who have received
a copy of the prospectus of the
T.Rowe Price New Asia Fund.
Investor Centers:
101 East Lombard St.
Baltimore, MD 21202
T. Rowe Price
Financial Center
10090 Red Run Blvd.
Owings Mills, MD 21117
Farragut Square
900 17th Street, N.W.
Washington, D.C. 20006
ARCO Tower
31st Floor
515 South Flower St.
Los Angeles, CA 90071
4200 West Cypress St.
10th Floor
Tampa, FL 33607
T. Rowe Price Investment Services, Inc., Distributor. F39-051 4/30/97
