<PAGE>
Semiannual Report
INTERNATIONAL
STOCK FUND
APRIL 30, 2000
T. ROWE PRICE
<PAGE>
REPORT HIGHLIGHTS
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International Stock Fund
. International stocks were strong during the past six months, with technology
stocks leading the way.
. The fund's returns for the 6- and 12-month periods were well ahead of the
MSCI EAFE Index and in line with the Lipper average over six months but
behind it for the year.
. Good performance was largely attributable to our focus on buoyant markets and
on stock selection in strong sectors.
. The portfolio contained a good balance of New Economy companies and those in
traditional growth industries.
. We expect continuing volatility but believe the fund's broad diversification
will serve investors well over the long term.
UPDATES AVAILABLE
For updates on T. Rowe Price funds following the end of each calendar quarter,
please see our Web site at www.troweprice.com.
<PAGE>
FELLOW SHAREHOLDERS
International stock markets provided solid gains during the six months ended
April 30, 2000. Strength in various technology sectors drove telecommunications,
media, and technology stocks sharply higher prior to a dramatic reversal in
mid-March. While investors refocused their attention on value, cyclical, and
more defensive growth stocks late in the quarter, stocks connected to technology
and the so-called New Economy dominated the period.
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PERFORMANCE COMPARISON
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Periods Ended 4/30/00 6 Months 12 Months
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International Stock Fund 14.15% 20.96%
MSCI EAFE Index 6.84 14.17
Lipper International
Funds Average 14.17 24.75
Your fund provided robust returns for the 6- and 12-month periods shown in the
table. Performance was well ahead of the MSCI EAFE Index and in line with the
Lipper International Funds Average for the past six months, and a bit behind
Lipper for the past year. Our exposure to several buoyant markets such as
Brazil, Mexico, and Sweden, and underweighting of weaker ones including the
U.K., Japan, and Switzerland helped results relative to the EAFE index.
Substantial positions in the technology and media sectors also lifted
performance, as did successful stock selection in several countries (Japan, Hong
Kong, Italy) and sectors (telecom, banking). Your fund's combination of more
reasonably valued telecommunications, media, and technology stocks and less
dynamic steady-growth holdings in other sectors helped performance when
leadership changed in March.
The strength of New Economy stocks and sectors contrasted sharply with those of
other industries. Telecom and Internet-related companies and their suppliers
soared, while established enterprises such as food manufacturers and utilities
were left far behind. Performance was divided between big winners and some
significant losers. However, sector leadership changed as an abundant supply of
new issues reduced the value of Internet-related investments and investors grew
concerned about valuations. Pharmaceuticals, consumer cyclicals, and
1
<PAGE>
financials started to recover. Performance in technology-related sectors became
increasingly selective and volatile with investors growing concerned about
stocks with great potential, perhaps, but no signs of earnings.
Improving international economies provided a supportive backdrop for stocks.
Europe enjoyed stronger-than-expected growth, with further consolidation in the
telecom and banking sectors. The euro's 13% decline against the dollar over the
past six months had several causes: investments flowing out of the euro zone as
European companies acquired U.S. companies, the persistent gap between
exceptionally strong U.S. growth compared with moderate growth in Europe, and
higher interest rates in the U.S.
In Japan, while stronger capital expenditure and steadily improving industrial
production signaled a reviving economy, unemployment remained high and the
consumer sector weak. The economic recovery continued throughout the rest of the
Pacific. The possible entry of China into the World Trade Organization
encouraged investment there. In Latin America, economies also improved. Mexico's
debt rating was raised to investment grade, further boosting regional prospects.
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T. ROWE PRICE BECOMES SOLE OWNER OF INTERNATIONAL INVESTMENT MANAGER
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As an international investor, you may be aware that the T. Rowe Price
international and global stock and bond funds have always been managed by Rowe
Price-Fleming International, Inc., a joint venture formed in 1979 between T.
Rowe Price Associates and London-based Robert Fleming Holdings, Limited.
On April 11, 2000, T. Rowe Price announced an agreement to purchase the 50% of
the joint venture owned by Flemings, thus becoming the sole owner of the
management company. In due course, the name of Rowe Price-Fleming International
will be changed to reflect its new status.
The change in ownership structure will not affect the investment approach or
operations of our international funds. We expect Rowe Price-Fleming's leadership
and professional staff to remain in place, together with the substantial
resources and expertise built up over the past 20 years. Likewise, there will be
no change in the offices in London, Hong Kong, Tokyo, Singapore, Buenos Aires,
Paris, and Baltimore.
Under the U.S. securities laws, the assignment of the funds' investment
management contract to a new entity is subject to shareholder approval.
Accordingly, after the purchase is concluded later this year, we will set a date
for a shareholder meeting and send you a proxy with voting information.
The formation of Rowe Price-Fleming 20 years ago opened the way for T. Rowe
Price to expand the investment services offered to shareholders and clients. As
an integral part of T. Rowe Price, this very successful international investment
manager will provide significant opportunities to enhance those services.
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INVESTMENT REVIEW
At the end of April, Europe represented 59% of net assets, down from 64% in
October. Within the region, the U.K. remained the largest country exposure at
17%. Japan was the largest country weighting overall at 21% of assets, little
changed from six months ago. In the Far East, our exposure was also fairly
stable at 8%. In Latin America, we split most of the portfolio between Mexico
and Brazil. Your fund was underweighted in Europe and Japan relative to the EAFE
index, but overweighted in the rest of Asia and Latin America. These shifts were
due to regional differences in performance and to some holdings in Asia. Our
purchases focused on selected New Economy stocks with strong potential and on
more traditional stocks, including banks and pharmaceuticals, which appeared
oversold based on their growth prospects.
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GEOGRAPHIC DIVERSIFICATION
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[GRAPH]
Latin America 5%
Other and Reserves 7%
Far East 8%
Japan 21%
Europe 59%
Europe
Country performance varied considerably, depending more on each country's
component of technology issues than on local factors. The Swedish and Finnish
markets were strongest, up 53% and 81% in U.S. dollar terms, respectively, due
mostly to the gains of technology leaders Ericsson Telephone and Nokia.
Stocks in Germany rose 16% (more than 33% in local currency terms) as its large
technology and telecom stocks soared. The weak euro significantly reduced
returns for U.S. investors in the euro zone. In France, technology and media
accounted for much of the market's 15% rise in dollar terms and 32% in local
currency. The U.K. and Switzerland, with fewer technology and telecom companies,
were the weakest major markets, falling 3% and 8%, respectively. Poorer
performance from financial services companies and pharmaceuticals held back
their returns.
Mobile telecom revenues are expected to rise in Europe as Internet-compatible
mobile telephones are introduced and customer usage
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MARKET PERFORMANCE
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Six Months Local Local Currency U.S.
Ended 4/30/00 Currency vs. U.S. Dollars Dollars
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France 32.23% -13.30% 14.64%
Germany 33.25 -13.30 15.53
Hong Kong 12.27 -0.25 11.99
Italy 26.37 -13.30 9.56
Japan 7.07 -3.44 3.39
Mexico 18.45 2.19 21.04
Netherlands 17.19 -13.30 1.60
Singapore 2.22 -2.56 -0.40
Sweden 66.38 -7.98 53.09
Switzerland 4.18 -11.44 -7.73
United Kingdom 1.57 -4.64 -3.14
Source: RIMES Online, using MSCI indices
increases. The biggest news in the sector was U.K.-based mobile telecom Vodafone
Airtouch's acquisition of Germany's second largest telecom, Mannesmann. The deal
reinforced Vodafone's preeminence as the leading global mobile business. The
initial public offerings (IPOs) of Terra Networks, controlled by Spanish telecom
Telefonica, and T-Online, controlled by Deutsche Telekom, were hugely
oversubscribed and their prices soared accordingly. U.K.-based Cable & Wireless,
which carries about a third of the world's Internet traffic, and United
Pan-Europe Communications of the Netherlands, with cable networks throughout
Europe, both performed strongly due to cable networks' potential for high-speed
broadband transmission.
Media companies surged because of their popular content, which can be provided
to Internet users. Another stimulus was the prospect for further growth as
Internet access via digital/interactive TV develops. Winners included Italy's
Telecom Italia and Television Francaise. Telecom Italia announced that it would
combine its dominant Internet subsidiary with Seat, and acquire that company in
the process, while the continued ascent of Television Francaise reflected
increasing advertising demand, market leadership, and the potential for
Internet-related growth. We took advantage of the sharp rise in Seat to lock in
some profits.
Technology stocks rocketed as markets for mobile telecom handsets, network
infrastructure, and other communications equipment mushroomed. Nokia and
Ericsson both benefited as demand for their telecom equipment and infrastructure
escalated, and we increased our holdings in Ericsson during the past six months.
ST Microelectronics in France, Germany's Siemens, and Philips Electronics and
ASM Lithography in the Netherlands all performed strongly due to the demand for
telecom, broadcasting, and Internet products.
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ADVISOR SHARE CLASS CREATED
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T. Rowe Price has introduced a new class of shares for certain funds, including
International Stock Fund. The new advisor class shares will be sold exclusively
by financial intermediaries, such as brokers and financial advisers, and will
enhance our ability to reach a new group of investors through this expanding
channel. Since the new share class has a modest 12b-1 fee (distribution fee paid
to the sales intermediary), its performance will likely vary somewhat from your
fund shares even though both invest in the same portfolio. We want to emphasize
that the new class will have no impact on your investment in the fund or on the
returns provided to you by the fund. The daily net asset value and expenses for
the existing shares and the advisor class shares are calculated separately. In
due course, you will see the advisor class share prices listed in newspapers and
other print and electronic media. Certain expenses associated with the advisor
class shares will be itemized in financial statements in your fund's shareholder
reports.
As sector leadership changed in March, neglected energy producers, financials,
basic materials, and pharmaceuticals rebounded, although they still trailed far
behind technology stocks. Energy producers Royal Dutch Petroleum/Shell Transport
& Trading (Netherlands/UK) and Total Fina (France) made tangible progress with
restructuring. The latter became more optimistic about its prospects for cost
reductions and various synergies as the merger between the two previously
independent companies progressed further. After a dull period, the earnings
outlook for pharmaceutical giant Glaxo Wellcome improved and we added to the
stock. The company's agreement to merge with SmithKline Beecham enhanced its
prospects for growth. The banking sector consolidated as Royal Bank of Scotland
won a battle against Bank of Scotland to acquire National Westminster Bank.
Finnish/Swedish Nordbanken Holding acquired its Danish neighbor Unidanmark, and
U.K.-based HSBC acquired French/Belgian bank CCF.
Unfortunately, the fund had its share of losers as well. We were disappointed by
investors' failure to reward companies with histories of solid, long-term
earnings growth while favoring many New Economy stocks with little or no
earnings. Food and beverage and some financial stocks were particularly hard
hit. Among them were Unilever of the U.K. and Belgian/Netherlands insurer
Fortis.
Far East and Other
In Japan, performance peaked early in 1999 and lagged during the past six
months. However, the sedate 3% rise in dollar terms masked volatile swings and a
wide disparity among sector performances. Our holdings in established,
fundamentally sound technology and
5
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OUR HOLDINGS IN ESTABLISHED, FUNDAMENTALLY SOUND TECHNOLOGY AND CONSUMER
ELECTRONICS COMPANIES PERFORMED WELL . . .
consumer electronics companies performed well in an environment of surging
demand for their products. Sony rose sharply following an announcement of its
intention to provide Internet banking, launch an Internet-compatible product,
and split its shares. Restructuring, robust demand, and plans for Internet
alliances and services drove the shares of NEC and Toshiba higher. Canon's
successful range of digital products and its strengthening position in the
semiconductor production equipment market accounted for its buoyancy. Murata
Manufacturing, best known for leadership in mobile handset components, and
Kyocera for handset production, also rose.
Telecom and media were other leading sectors. The agreement among DDI, IDO, and
KDD to merge marked the first step in the consolidation of telecom companies,
and Kyocera's sharp gain partly reflected its status as the largest shareholder
in the proposed new entity. The strong performance of Japan's dominant mobile
telecom, NTT Mobile Communications Network, reflected the success of its
Internet-compatible services. We added to this position during the period. Media
company Fuji Television climbed due to its popular programs, advertising growth,
and potential to provide viewers with Internet access.
Outside technology, your fund's low exposure to declining banking stocks helped
performance. Brokerage firms, in contrast, registered strong gains due to record
launches of stock funds. Nomura Securities, which surged in this environment,
expects to benefit as savings accounts containing over $1 trillion mature during
the next two years. A significant percentage of this money is likely to be
invested into equity funds. Perceiving that bank stocks had been oversold during
the period, we added to Sumitomo Bank and established a new position in Fuji
Bank.
Despite the high-flying technology sectors, Japan's economy remained lackluster.
Fourth-quarter GDP was off 1.4% from the third quarter, and unemployment rose to
a postwar high of 4.9%. While industrial production strengthened, worries about
future job losses depressed consumer spending and retail sales as company
restructuring and bankruptcies increased. Underfunding of corporate pensions and
planned cuts to national pension benefits also hurt consumption.
6
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INDUSTRY DIVERSIFICATION
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Percent of Net Assets
10/31/99 4/30/00
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Services 29.4% 39.4%
Capital Equipment 16.4 18.1
Finance 20.3 16.4
Consumer Goods 19.7 14.2
Energy 7.6 6.0
All Other 3.6 2.9
Reserves 3.0 3.0
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Total 100.0% 100.0%
Technology-related stocks also led markets in Asia outside of Japan. Singapore
and South Korea were weaker since lagging financial, natural resources, and
industrial companies dominate those markets. In contrast, Hong Kong, Taiwan, and
India registered double-digit gains because of their exposure to
technology-related issues.
Hong Kong's leading performers were Internet company Pacific Century CyberWorks,
China Telecom (Hong Kong), and diversified Internet portal holding company
Hutchison Whampoa. Rapidly growing demand, impressive results, and the possible
admission of China to the World Trade Organization stimulated China Telecom, one
of the world's largest cellular phone operators, which provides mobile telecom
services in China. Hutchison's announcements of several Internet-related deals
drove its performance. Among our laggards in this region, Henderson Land
Development fell in price as property values failed to recover as expected.
In the region's emerging markets, South Korean technology giant Samsung
Electronics, with significant market positions in semiconductors, flat panel
screens, and mobile handsets, rose rapidly through the quarter and we added to
this position. In Taiwan, two of the world's leading electronic component
producers, Taiwan Semiconductor Manufacturing and Hon Hai, performed extremely
well. Indian finance company ICICI was one of the region's best performers,
helped by the company's focus on returns, beneficial government reforms, and the
potential for increased market share versus the state-owned banks.
Despite overall weakness in the Australian market, our media holdings there were
winners. Both News Corporation and Publishing & Broadcasting have valuable
content and Internet businesses. NewsCorp's interests extend globally and range
from film to digital television and program content production, and we added to
these holdings. On the losing side of the ledger, telecom Telstra suffered
7
<PAGE>
from a rapid decline in its core business and the slow pace of the company's
Internet development.
Latin America
Further economic advances in Brazil and Mexico, coupled with the buoyancy of
regional TMT stocks, pushed Brazil up 38% and Mexico 21% in dollar terms.
Brazilian investors contributed to gains there as they switched from bonds to
stocks when interest rates fell from over 30% early in 1999 to around 19%.
However, Brazil's need to fund its fiscal deficit and Mexico's close trade links
with the U.S. make their markets sensitive to changes in U.S. interest rates,
economic growth, and stock performance.
Your portfolio's largest positions in the region, Telebras in Brazil and Telmex
in Mexico, performed well. Both have significant growth prospects because market
penetration is low and improving economic conditions encourage consumer
spending. They also carry more attractive valuations than their peers in
developed markets. In this market, we added to media company Grupo Televisa.
Brazil's major energy stock, Petrobras, was another market leader as the
company's restructuring raised returns and earnings. Its growth potential and
the possibility of further deregulation also encouraged investors.
Investment Outlook
Accelerating deregulation, restructuring, and consolidation in Europe are key
catalysts for earnings growth. The convergence of information and communication
technologies and their application to traditional businesses are additional
stimuli for further market gains. If Japan's growth potential is to be fully
realized, it will need to complement its leading position in New Economy
technology with a willingness to alter traditional ways of doing business. In
the rest of Asia, the slow but steady pace of reform, coupled with economic
recovery, could fuel growth of traditional and Internet-related sectors. The
region's enthusiastic embracing of the New Economy should also stimulate
markets.
Around the world, the extent to which companies can increase shareholder value
by integrating new technologies and the Internet with traditional businesses, or
by providing networks and software, will benefit their earnings outlooks.
Competition drives prices down, bringing rewards to consumers and to the
shareholders of companies that compete best.
8
<PAGE>
Following a year of speculation in Internet and technology stocks, we welcome a
return to selectivity and a focus on financial fundamentals. After this period
of volatility and consolidation among technology companies is over, the firms
that can compete and flourish in this changing environment will emerge as
winners over time. With this transition taking place and interest rates rising,
we expect stock market volatility to continue during the next few months. Your
fund contains the stocks of diverse companies with solid fundamentals and
leading market positions across a wide range of industries and international
markets. We believe this approach will continue to serve our shareholders well
over the long term.
Respectfully submitted,
/s/ Martin G. Wade
Martin G. Wade
Chairman
/s/ John R. Ford
John R. Ford
President
May 19, 2000
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NEW PRESIDENT OF T. ROWE PRICE INTERNATIONAL FUNDS
After more than 20 years as president of T. Rowe Price International Funds,
Inc., Martin G. Wade has passed the baton to his colleague, John R. Ford. John
Ford has been associated with T. Rowe Price's international investment
management arm since 1984. He currently serves on the Investment Advisory
Committees of all the T. Rowe Price international equity funds.
Mr. Wade was instrumental in the launching of T. Rowe Price's first foreign
stock offering, the International Stock Fund, in 1980, and played a key role
thereafter in the company's increasing presence as an international asset
manager. He remains associated with the International Funds as chairman and is
also a member of the Board of Directors of T. Rowe Price Associates.
9
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T. ROWE PRICE INTERNATIONAL STOCK FUND
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PORTFOLIO HIGHLIGHTS
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TWENTY-FIVE LARGEST HOLDINGS
Percent of
Net Assets
4/30/00
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Vodafone Airtouch, United Kingdom 3.0%
Nokia, Finland 2.9
Glaxo Wellcome, United Kingdom 1.8
Sony, Japan 1.7
Television Francaise, France 1.7
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Murata Manufacturing, Japan 1.6
Vivendi, France 1.5
Total Fina, France 1.5
News Corporation, Australia 1.5
Shell Transport & Trading, United Kingdom 1.4
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Cable & Wireless, Hong Kong/United Kingdom 1.4
NTT Mobile Communications Network, Japan 1.3
Kyocera, Japan 1.3
Nippon Telegraph & Telephone, Japan 1.3
NEC, Japan 1.3
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Telecom Italia Mobile, Italy 1.3
Philips Electronics, Netherlands 1.3
Canon, Japan 1.3
Ericsson Telephone, Sweden 1.2
Royal Bank of Scotland, United Kingdom 1.2
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Adecco, Switzerland 1.2
Telebras, Brazil 1.2
ING Groep, Netherlands 1.1
Telefonica, Spain 1.1
Samsung Electronics, South Korea 1.0
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Total 37.1%
Note: Table excludes reserves.
10
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T. ROWE PRICE INTERNATIONAL STOCK FUND
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PERFORMANCE COMPARISON
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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 benchmarks, which may include a broad-
based market index and a peer group average or index. Market indexes do not
include expenses, which are deducted from fund returns as well as mutual fund
averages and indexes.
INTERNATIONAL STOCK FUND
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[GRAPH]
<TABLE>
<CAPTION>
As of 4/30/00
MSCI EAFE Index Lipper International Funds Average International Stock Fund
<S> <C> <C> <C>
Apr-90 10,000 10,000 10,000
Apr-91 10,471 10,308 10,524
Apr-92 9,615 10,778 11,191
Apr-93 11,735 11,737 12,196
Apr-94 13,724 14,469 15,094
Apr-95 14,531 14,563 15,378
Apr-96 16,238 16,977 18,142
Apr-97 16,141 18,320 19,432
Apr-98 19,245 22,329 22,709
Apr-99 21,132 22,748 24,210
Apr-00 24,128 26,974 29,285
</TABLE>
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AVERAGE ANNUAL COMPOUND TOTAL RETURN
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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.
Periods Ended 4/30/00 1 Year 3 Years 5 Years 10 Years
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International StockFund 20.96% 14.65% 13.75% 11.34%
Investment return and principal value represent past performance and will vary.
Shares may be worth more or less at redemption than at original purchase.
11
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T. ROWE PRICE INTERNATIONAL STOCK FUND
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Unaudited
International Stock shares
<TABLE>
<CAPTION>
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FINANCIAL HIGHLIGHTS For a share outstanding throughout each period
--------------------------------------------------------------------------------------------------------
6 Months Year
Ended Ended
4/30/00 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE
Beginning of period $ 16.70 $ 14.39 $14.14 $ 13.47 $12.09 $12.84
Investment activities
Net investment
income (loss) 0.03 0.17 0.23 0.19 0.19 0.18
Net realized and
unrealized gain (loss) 2.29 2.71 0.77 0.86 1.57 (0.19)
Total from
investment activities 2.32 2.88 1.00 1.05 1.76 (0.01)
Distributions
Net investment income (0.13) (0.22) (0.20) (0.18) (0.18) (0.12)
Net realized gain (0.91) (0.35) (0.55) (0.20) (0.20) (0.62)
Total distributions (1.04) (0.57) (0.75) (0.38) (0.38) (0.74)
NET ASSET VALUE
End of period $ 17.98 $ 16.70 $14.39 $ 14.14 $13.47 $12.09
=======================================================================
Ratios/Supplemental Data
Total return u 14.15% 20.67% 7.48% 7.90% 14.87% 0.38%
Ratio of total expenses to
average net assets 0.84%+ 0.85% 0.85% 0.85% 0.88% 0.91%
Ratio of net investment
income (loss) to average
net assets 0.31%+ 1.05% 1.50% 1.33% 1.58% 1.56%
Portfolio turnover rate 51.8%+ 17.6% 12.2% 15.8% 11.6% 17.8%
Net assets, end of period
(in millions) $ 12,085 $10,615 $9,537 $10,005 $8,776 $6,386
</TABLE>
u Total return reflects the rate that an investor would have earned on an
investment in the fund during each period, assuming reinvestment of all
distributions.
+ Annualized
The accompanying notes are an integral part of these financial statements.
12
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T. ROWE PRICE INTERNATIONAL STOCK FUND
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Unaudited April 30, 2000
-------------------------
PORTFOLIO OF INVESTMENTS Shares Value
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in thousands
ARGENTINA 0.2%
Common Stocks 0.2%
Telefonica de Argentina (Class B) ADR (USD) 526,380 $ 18,489
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Total Argentina (Cost $14,403) 18,489
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AUSTRALIA 3.1%
Common Stocks 2.3%
Brambles Industries 1,089,000 30,654
Broken Hill Proprietary 1,290,966 13,903
Commonwealth Bank of Australia 1,899,448 28,930
Lend Lease 1,342,828 14,552
News Corporation 6,539,468 83,049
Publishing & Broadcasting 3,902,850 30,314
TABCORP Holdings 2,378,000 12,729
Telstra 7,199,693 30,862
Telstra, Installment Receipts * 1,864,000 4,768
Westpac Banking 4,446,600 28,383
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278,144
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Preferred Stocks 0.8%
News Corporation 9,021,184 97,043
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97,043
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Total Australia (Cost $301,144) 375,187
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BELGIUM 0.6%
Common Stocks 0.6%
Dexia (EUR) 212,652 27,568
Fortis B (EUR) 1,239,275 31,286
Societe Europeenne des Satellites (Class A) (EUR) 57,900 8,797
UCB (EUR) 135,450 4,556
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Total Belgium (Cost $44,688) 72,207
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BRAZIL 2.2%
Common Stocks 1.4%
Embratel Participacoes ADR (USD) 496,000 11,160
Pao de Acucar GDR (USD) 370,084 10,547
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T. Rowe Price International Stock Fund
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Shares Value
--------------------------------------------------------------------------------
in thousands
Telebras ADR (USD) 1,190,799 $ 140,738
Unibanco GDR (USD) 421,960 10,523
-------------
172,968
-------------
Preferred Stocks 0.8%
Banco Itau 162,870,000 12,178
Petrol Brasileiros 251,033,189 59,800
Telecomunicacoes de Sao Paulo 449,008,810 11,189
Telesp Cellular Participacoes 477,260,206 8,564
91,731
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Total Brazil (Cost $228,527) 264,699
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CANADA 1.1%
Common Stocks 1.1%
Alcan Aluminum 432,360 14,072
Celestica (USD) * 1,310,278 71,492
Nortel Networks 353,990 40,015
Royal Bank of Canada 185,920 8,776
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Total Canada (Cost $89,259) 134,355
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DENMARK 0.2%
Common Stocks 0.2%
Tele Danmark A/S 276,534 20,251
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Total Denmark (Cost $13,584) 20,251
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FINLAND 2.9%
Common Stocks 2.9%
Nokia (EUR) 6,192,912 355,252
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Total Finland (Cost $60,210) 355,252
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FRANCE 11.6%
Common Stocks 11.6%
Alcatel Alsthom (EUR) 410,444 95,149
Altran Technologies (EUR) 91,600 18,720
Aventis (EUR) 223,030 12,044
AXA (EUR) 543,170 80,736
Banque National de Paris (EUR) 975,980 78,878
14
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T. Rowe Price International Stock Fund
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Shares Value
--------------------------------------------------------------------------------
in thousands
Canal Plus (EUR) 231,380 $ 44,594
Cap Gemini (EUR) 221,030 43,382
Carrefour (EUR) 171,528 11,118
Cie de St. Gobain (EUR) 231,048 31,528
Danone (EUR) 62,915 13,756
Hermes (EUR) 149,390 21,322
L'Oreal (EUR) 17,474 12,073
Lafarge (EUR) 65,643 5,574
Legrand (EUR) 214,933 40,095
LVMH (EUR) 113,227 47,515
Rhone Poulenc (EUR) 1,407,784 77,429
Sanofi Synthelabo (EUR) 1,618,516 60,401
Schneider Electric (EUR) 201,661 13,200
Societe Generale (EUR) 85,267 17,658
Sodexho Alliance (EUR) 84,901 12,720
STMicroelectronics (EUR) 502,197 95,510
Television Francaise (EUR) 296,207 202,769
Total Fina (Class B) (EUR) 1,190,252 180,595
Vivendi (EUR) 1,864,952 184,462
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Total France (Cost $875,932) 1,401,228
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GERMANY 4.4%
Common Stocks 4.3%
Allianz (EUR) 170,760 65,712
Bayer (EUR) 354,862 14,785
Bayerische Vereinsbank (EUR) 1,108,247 68,611
Deutsche Bank (EUR) 931,215 62,561
Deutsche Telekom (EUR) 988,570 64,159
Gehe (EUR) 603,872 18,775
Infineon Technologies (EUR) * 913,982 62,941
Rhoen Klinikum (EUR) 431,484 15,906
SAP (EUR) 211,770 99,148
Siemens (EUR) 131,182 19,439
Veba (EUR) 499,136 25,048
-------------
517,085
-------------
Preferred Stocks 0.1%
SAP (EUR) 15,590 9,191
9,191
-------------
Total Germany (Cost $401,753) 526,276
-------------
15
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Shares Value
--------------------------------------------------------------------------------
In thousands
HONG KONG 3.1%
Common Stocks 3.1%
Cable & Wireless Hong Kong Telecom 9,675,600 $ 22,856
Cheung Kong Holdings 5,342,000 63,781
China Telecom (Hong Kong) 13,627,000 97,533
Dao Heng Bank Group 5,410,000 25,004
Henderson Land Development 5,014,000 21,951
Hutchison Whampoa 6,065,000 87,987
Pacific Century CyberWorks 20,946,000 38,992
Sun Hung Kai Properties 1,567,000 12,272
----------
Total Hong Kong (Cost $215,267) 370,376
----------
INDIA 1.2%
Common Stocks 1.2%
Global Tele-Systems 796,000 21,790
Hindustan Lever 807,000 44,277
ICICI Limited 5,796,122 17,891
ICICI Limited ADR (USD) 1,375,847 34,912
Mahanagar Telephone 4,891,000 25,217
----------
Total India (Cost $130,812) 144,087
----------
IRELAND 0.2%
Common Stocks 0.2%
SmartForce ADR (USD) * 607,671 29,244
----------
Total Ireland (Cost $14,186) 29,244
----------
ITALY 5.0%
Common Stocks 5.0%
Alleanza Assicurazioni (EUR) 2,413,500 24,969
Banca Intesa (EUR) 5,696,089 20,972
Banca Popolare di Brescia (EUR) 697,000 63,364
ENI (EUR) 9,048,855 44,998
Gucci Group (USD) 188,705 16,535
Mediaset (EUR) 2,477,000 40,195
Mediolanum (EUR) 2,983,325 49,497
16
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Shares Value
--------------------------------------------------------------------------------
In thousands
Sanpaolo IMI (EUR) 1,779,884 $ 24,919
Tecnost (EUR) 5,484,000 19,244
Telecom Italia (EUR) 7,087,445 99,096
Telecom Italia Mobile (EUR) 16,220,182 154,831
Unicredito (EUR) 11,704,666 47,458
----------
Total Italy (Cost $365,296) 606,078
----------
JAPAN 20.8%
Common Stocks 20.8%
Bridgestone 702,000 15,240
Canon 3,309,000 151,335
DDI 1,978 22,707
East Japan Railway 2,399 14,214
Fanuc 439,900 46,102
Fuji Bank 9,595,000 79,947
Fuji Television Network 4,833 80,539
Fujitsu 2,786,000 78,926
Hitachi 1,470,000 17,556
Ito-Yokado 374,000 27,319
Kao 687,000 20,925
Kokuyo 1,058,000 15,035
Komori 453,000 6,211
Kyocera 957,000 160,098
Makita 1,403,000 12,184
Marui 2,129,000 40,012
Matsushita Electric Industrial 4,491,000 118,912
Mitsui Fudosan 3,739,000 38,008
Murata Manufacturing 982,000 190,918
NEC 5,745,000 156,370
Nippon Telegraph & Telephone 12,884 159,835
Nomura Securities 3,983,000 100,299
NTT DoCoMo 4,804 160,556
Sankyo 1,407,000 31,002
Seven-Eleven Japan 701,000 86,315
Shin-Etsu Chemical 822,000 43,453
Shiseido 1,266,000 16,010
Softbank (New Shares) * 134,400 33,222
17
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
------------------------------------------------------------------------------------------
in thousands
<S> <C> <C>
Softbank 61,500 $ 15,145
Sony (New Shares) * 907,600 105,032
Sony 907,600 104,275
Sumitomo 3,107,000 34,805
Sumitomo Bank 5,019,000 62,775
Sumitomo Electric Industries 1,609,000 21,435
TDK 390,000 52,246
Toshiba 12,474,000 121,027
Yamanouchi Pharmaceutical 1,489,000 78,713
----------
Total Japan (Cost $1,571,327) 2,518,703
----------
MEXICO 2.2%
Common Stocks 2.2%
Femsa UBD (Represents 1 Class B and 4 Series D shares) * 7,144,360 28,281
Grupo Iusacell ADR (USD) * 762,900 12,159
Grupo Televisa GDR (USD) * 1,637,566 103,883
Telefonos de Mexico (Class L) ADR (USD) 2,134,444 125,532
----------
Total Mexico (Cost $204,913) 269,855
----------
NETHERLANDS 6.5%
Common Stocks 6.5%
ABN Amro (EUR) 547,369 11,271
Akzo Nobel (EUR) 93,698 3,836
ASM Lithography (EUR) 2,569,350 100,439
CSM (EUR) 1,200,977 20,635
Equant (EUR) * 389,684 30,165
Fortis NI (EUR) 1,758,504 44,219
ING Groep (EUR) 2,502,060 136,523
KPN (EUR) 236,387 23,821
Philips Electronics (EUR) 3,455,960 154,169
Royal Dutch Petroleum (EUR) 1,153,482 66,483
TNT Post Groep (EUR) 117,648 2,567
United Pan-Europe Communications (EUR) * 882,595 32,119
VNU (EUR) 2,338,530 125,112
Wolters Kluwer (EUR) 1,400,994 33,064
----------
Total Netherlands (Cost $500,304) 784,423
----------
</TABLE>
18
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Shares Value
--------------------------------------------------------------------------------
in thousands
NEW ZEALAND 0.2%
Common Stocks 0.2%
Telecom Corporation of New Zealand 5,703,628 $ 24,096
---------
Total New Zealand (Cost $24,831) 24,096
---------
NORWAY 0.2%
Common Stocks 0.2%
Orkla (Class A) 1,352,094 20,904
---------
Total Norway (Cost $10,745) 20,904
---------
PORTUGAL 0.1%
Common Stocks 0.1%
Jeronimo Martins (EUR) 994,923 17,746
---------
Total Portugal (Cost $7,090) 17,746
---------
SINGAPORE 0.5%
Common Stocks 0.5%
United Overseas Bank 8,657,592 60,372
---------
Total Singapore (Cost $57,156) 60,372
---------
SOUTH KOREA 1.5%
Common Stocks 1.5%
Korea Telecom ADR (USD) 918,300 31,681
Pohang Iron & Steel ADR (USD) 353,333 7,420
Samsung Electronics 464,937 125,687
South Korea Telecom 52,000 13,823
---------
Total South Korea (Cost $127,302) 178,611
---------
SPAIN 3.0%
Common Stocks 3.0%
Banco Bilbao Vizcaya (EUR) 2,640,033 36,001
Banco Santander Central Hispano (EUR) 8,320,688 86,763
Empresa Nacional de Electricidad (EUR) 2,949,600 63,980
Gas Natural (EUR) 599,877 10,023
19
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Shares Value
--------------------------------------------------------------------------------
in thousands
Repsol (EUR) 1,440,952 $ 29,474
Telefonica (EUR) 5,856,168 130,328
----------
Total Spain (Cost $225,000) 356,569
----------
SWEDEN 3.6%
Common Stocks 3.6%
ABB 237,127 26,447
Atlas Copco (Class B) 299,088 6,838
Electrolux (Class B) 1,207,475 20,403
Hennes & Mauritz (Class B) 1,917,100 50,889
LM Ericsson 1,689,280 150,162
Nordic Baltic Holding 7,536,824 47,494
Nordic Baltic Holding (DKK) * 1,150,334 7,160
Sandvik (Class B) 608,700 14,529
Securitas (Class B) 4,130,758 106,886
----------
Total Sweden (Cost $253,884) 430,808
----------
SWITZERLAND 3.7%
Common Stocks 3.7%
ABB 417,174 46,808
Adecco 177,372 145,534
Credit Suisse Group 222,085 40,115
Nestle 57,516 101,388
Roche Holdings 3,493 36,478
Swisscom 43,996 15,511
UBS 254,665 62,391
----------
Total Switzerland (Cost $241,346) 448,225
----------
TAIWAN 1.4%
Common Stocks 1.4%
Hon Hai Precision Industry 6,053,000 58,364
Taiwan Semiconductor Manufacturing 15,845,630 102,029
United Microelectronics 3,980,000 13,464
----------
Total Taiwan (Cost $133,125) 173,857
----------
20
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Shares Value
--------------------------------------------------------------------------------
in thousands
UNITED KINGDOM 17.5%
Common Stocks 17.5%
Abbey National 1,399,350 $ 15,970
AstraZeneca Group 1,863,620 78,023
Baltimore Technologies 239,000 24,076
BG Group 1,385,897 8,334
BP Amoco 4,923,000 42,502
Cable & Wireless 8,580,150 142,272
Cadbury Schweppes 5,470,792 37,478
Celltech Group 945,000 15,596
Centrica 2,938,768 10,478
Compass Group 8,297,000 117,812
David S. Smith 1,692,560 3,584
Diageo 5,764,652 46,627
Electrocomponents 2,251,000 22,605
GKN 388,000 5,377
Glaxo Wellcome 6,999,210 213,808
Hays 938,000 6,484
Hilton Group 2,191,470 9,178
HSBC Holdings (HKD) 1,652,800 18,514
John Laing (Class A) 1,373,000 4,639
Kingfisher 4,608,233 37,722
Marconi 3,538,100 44,069
Reed International 14,454,175 100,327
Rio Tinto 2,964,900 45,931
Royal Bank of Scotland 9,611,129 149,042
Safeway 2,835,960 9,560
Shell Transport & Trading 20,711,000 167,679
SmithKline Beecham 9,040,680 123,379
Standard Chartered 2,970,000 40,091
Tesco 6,600,592 22,429
Tomkins 11,022,954 33,852
Unilever 4,763,107 28,551
United News & Media 1,813,215 23,573
Vodafone Airtouch 79,360,746 363,887
WPP Group 6,317,000 101,795
------------
Total United Kingdom (Cost $1,725,913) 2,115,244
------------
21
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Value
--------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS 2.6%
Money Market Funds 2.6%
Reserve Investment Fund, 6.18% +# 318,787,727 $ 318,788
------------
Total Short-Term Investments (Cost $318,788) 318,788
------------
Total Investments in Securities
99.6% of Net Assets (Cost $8,156,785) $ 12,035,930
Other Assets Less Liabilities 49,006
------------
NET ASSETS $ 12,084,936
============
* Non-income producing
+ Affiliated company
# Seven-day yield
ADR American depository receipt
EUR Euro
GDR Global depository receipt
HKD Hong Kong dollar
USD U.S. dollar
The accompanying notes are an itegral part of these financial statements.
22
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Unaudited April 30, 2000
-----------------------------------
STATEMENT OF ASSETS AND LIABILITIES
--------------------------------------------------------------------------------
In thousands
Assets
Investments in securities, at value (cost $8,156,785) $12,035,930
Securities lending collateral 2,699,955
Other assets 114,593
-----------
Total assets 14,850,478
-----------
Liabilities
Obligation to return securities lending collateral 2,699,955
Other liabilities 65,587
-----------
Total liabilities 2,765,542
-----------
NET ASSETS $12,084,936
===========
Net Assets Consist of:
Accumulated net investment income - net of distributions $ 15,872
Accumulated net realized gain/loss - net of distributions 719,063
Net unrealized gain (loss) 3,877,995
Paid-in-capital applicable to 672,298,377 shares of $0.01
par value capital stock outstanding; 2,000,000,000 shares
of the Corporation authorized 7,472,006
-----------
NET ASSETS $12,084,936
===========
net asset value per share
International Stock shares
($12,084,926,206 / 672,297,854 shares outstanding) $ 17.98
===========
International Stock Advisor shares
($9,999 / 523 shares outstanding) $ 19.12
===========
The accompanying notes are an integral part of these financial statements.
23
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Unaudited
-----------------------
STATEMENT OF OPERATIONS
--------------------------------------------------------------------------------
In thousands
6 Months
Ended
4/30/00
Investment Income (Loss)
Income
Dividend (net of foreign taxes of $7,303) $ 54,016
Interest (including $11,266 from affiliated companies) 11,577
Securities lending 4,013
-----------
Total income 69,606
-----------
Expenses
Investment management 40,567
Shareholder servicing
International Stock shares 8,216
International Stock Advisor shares -
Custody and accounting 1,738
Prospectus and shareholder reports
International Stock shares 246
International Stock Advisor shares -
Registration 99
Legal and audit 19
Directors 8
Miscellaneous 54
-----------
Total expenses 50,947
Expenses paid indirectly (4)
-----------
Net expenses 50,943
-----------
Net investment income (loss) 18,663
-----------
Realized and Unrealized Gain (Loss)
Net realized gain (loss)
Securities 747,478
Futures 21,789
Foreign currency transactions (11,696)
-----------
Net realized gain (loss) 757,571
-----------
Change in net unrealized gain or loss
Securities 722,612
Other assets and liabilities
denominated in foreign currencies (526)
-----------
Change in net unrealized gain or loss 722,086
-----------
Net realized and unrealized gain (loss) 1,479,657
-----------
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 1,498,320
===========
The accompanying notes are an integral part of these financial statements.
24
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Unaudited
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
In thousands
<TABLE>
<CAPTION>
6 Months Year
Ended Ended
4/30/00 10/31/99
<S> <C> <C>
Increase (Decrease) in Net Assets
Operations
Net investment income (loss) $ 18,663 $ 105,886
Net realized gain (loss) 757,571 589,813
Change in net unrealized gain or loss 722,086 1,201,410
--------------------------------
Increase (decrease) in net assets from operations 1,498,320 1,897,109
--------------------------------
Distributions to shareholders
Net investment income
International Stock shares (82,379) (144,745)
Net realized gain
International Stock shares (576,571) (230,270)
--------------------------------
Decrease in net assets from distributions (658,950) (375,015)
--------------------------------
Capital share transactions *
Shares sold
International Stock shares 2,397,836 2,598,320
International Stock Advisor shares 10 -
Distributions reinvested
International Stock shares 591,663 351,615
Shares redeemed
International Stock shares (2,359,281) (3,393,820)
--------------------------------
Increase (decrease) in net assets from capital
share transactions 630,228 (443,885)
--------------------------------
Net Assets
Increase (decrease) during period 1,469,598 1,078,209
Beginning of period 10,615,338 9,537,129
--------------------------------
End of period $ 12,084,936 $ 10,615,338
================================
* Share information
Shares sold
International Stock shares 130,213 168,506
International Stock Advisor shares 1 -
Distributions reinvested
International Stock shares 34,279 24,520
Shares redeemed
International Stock shares (127,659) (220,433)
--------------------------------
Increase (decrease) in shares outstanding 36,834 (27,407)
</TABLE>
The accompanying notes are an integral part of these financial statements.
25
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
Unaudited April 30, 2000
-----------------------------
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 International Stock Fund (the fund), a
diversified, open-end management investment company is one of the portfolios
established by the corporation. The fund seeks long-term growth of capital by
investing primarily in the common stocks of established, non-U.S. companies. The
fund has two classes of shares - International Stock, offered since May 9, 1980,
and International Stock Advisor Class, first offered on March 31, 2000.
International Stock Advisor Class sells its shares only through financial
intermediaries, which it compensates for distribution and certain administrative
services under a Board-approved Rule 12b-1 plan. Each class has exclusive voting
rights on matters related solely to that class, separate voting rights on
matters that relate to both classes, and, in all other respects, the same rights
and obligations as the other class.
The accompanying financial statements are prepared in accordance with generally
accepted accounting principles for the investment company industry; these
principles may require the use of estimates by fund management.
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.
Investments in mutual funds are valued at the closing net asset value per share
of the mutual fund on the day of valuation.
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 As defined by the Investment Company Act of 1940, an
affiliated company is one in which the fund owns at least 5% of the outstanding
voting securities.
26
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
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.
Class Accounting The International Stock Advisor Class pays distribution and
administrative expenses, in the form of Rule 12b-1 fees, in an amount not
exceeding 0.25% of the class's average net assets. Shareholder servicing,
prospectus, and shareholder report expenses are charged directly to the class to
which they relate. Expenses common to both classes, investment income, and
realized and unrealized gains and losses are allocated to the classes based upon
the relative daily net assets of each class. Income distributions are declared
and paid by each class on an annual basis. Capital gain distributions are
declared and paid by the fund on an annual basis.
Other Income and expenses are recorded on the accrual basis. 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. Expenses paid indirectly reflect
credits earned on daily uninvested cash balances at the custodian and are used
to reduce the fund's custody charges.
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.
Securities Lending The fund lends its securities to approved brokers to earn
additional income and receives cash and U.S. government securities as collateral
against the loans. Cash collateral received is invested in a money market pooled
account by the fund's lending agent. Collateral is maintained over the life of
the loan in an amount not less than 100% of the value of loaned securities.
Although 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
27
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
borrower fails to return them. At April 30, 2000, the value of loaned securities
was $2,658,349,000; aggregate collateral consisted of $2,699,955,000 in the
securities lending collateral pool and U.S. government securities valued at
$66,676,000.
Other Purchases and sales of portfolio securities, other than short-term
securities, aggregated $3,031,913,000 and $3,019,599,000, respectively, for the
six months ended April 30, 2000.
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.
At April 30, 2000, the cost of investments for federal income tax purposes was
substantially the same as for financial reporting and totaled $8,156,785,000.
Net unrealized gain aggregated $3,879,145,000 at period-end, of which
$4,207,647,000 related to appreciated investments and $328,502,000 to
depreciated investments.
NOTE 4 - FOREIGN TAXES
The fund is subject to foreign income taxes imposed by certain countries in
which it invests. Foreign income taxes are accrued by the fund and withheld from
dividend and interest income.
NOTE 5 - RELATED PARTY TRANSACTIONS
The fund is managed by Rowe Price-Fleming International, Inc. (the manager),
which is owned by subsidiaries of T. Rowe Price Associates, Inc. (Price
Associates) and Robert Fleming Holdings Limited (Fleming). Price Associates has
entered into an agreement with Fleming to purchase Fleming's interest in the
manager.
The investment management agreement between the fund and the manager provides
for an annual investment management fee, of which $6,718,000 was payable at
April 30, 2000. The fee is computed daily and paid monthly, and consists of an
individual fund fee equal to 0.35% 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 0.295% for assets in excess of $120
billion. At April 30, 2000, and for the six months then ended,
28
<PAGE>
T. ROWE PRICE INTERNATIONAL STOCK FUND
--------------------------------------------------------------------------------
the effective annual group fee rate was 0.32%. 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. 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. The fund incurred expenses pursuant to these
related party agreements totaling approximately $5,640,000 for the six months
ended April 30, 2000, of which $1,105,000 was payable at period-end.
Additionally, the fund is one of several T. Rowe Price-sponsored mutual funds
(underlying funds) in which the T. Rowe Price Spectrum Funds (Spectrum) may
invest. Spectrum does not invest in the underlying funds for the purpose of
exercising management or control. Expenses associated with the operation of
Spectrum are borne by each underlying fund to the extent of estimated savings to
it and in proportion to the average daily value of its shares owned by Spectrum,
pursuant to special servicing agreements between and among Spectrum, the
underlying funds, T. Rowe Price, and, in the case of T. Rowe Price Spectrum
International, Rowe Price-Fleming International. Spectrum International Fund and
Spectrum Growth Fund held approximately 6.4% of the outstanding International
Stock shares at April 30, 2000. For the six months then ended, the fund was
allocated $880,000 of Spectrum expenses, $162,000 of which was payable at
period-end.
The fund may invest in the Reserve Investment Fund and Government Reserve
Investment Fund (collectively, the Reserve Funds), open-end management
investment companies managed by T. Rowe Price Associates, Inc. The Reserve Funds
are offered as cash management options only to mutual funds and other accounts
managed by T. Rowe Price and its affiliates and are not available to the public.
The Reserve Funds pay no investment management fees. Distributions from the
Reserve Funds to the fund for the six months ended April 30, 2000, totaled
$11,266,000 and are reflected as interest income in the accompanying Statement
of Operations.
During the six months ended April 30, 2000, the fund, in the ordinary course of
business, placed security purchase and sale orders aggregating $139,072,000 with
certain affiliates of the manager and paid commissions of $166,000 related
thereto.
29
<PAGE>
For fund and account information or to conduct transactions, 24 hours, 7 days a
week
By touch-tone telephone
Tele*Access 1-800-638-2587
By Account Access on the Internet
www.troweprice.com/access
For assistance with your existing fund account, call:
Shareholder Service Center 1-800-225-5132
To open a brokerage account or obtain information, call:
1-800-638-5660
Internet address:
www.troweprice.com
Plan Account Lines for retirement plan participants:
The appropriate 800 number appears on your retirement account statement.
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 appropriate to the fund or funds
covered in this report.
Walk-In Investor Centers:
For directions, call 1-800-225-5132 or visit our Web site
Baltimore Area
Downtown
101 East Lombard Street
Owings Mills
Three Financial Center
4515 Painters Mill Road
Boston Area
386 Washington Street
Wellesley
Colorado Springs
4410 ArrowsWest Drive
Los Angeles Area
Warner Center
21800 Oxnard Street, Suite 270
Woodland Hills
Tampa
4200 West Cypress Street
10th Floor
Washington, D.C.
900 17th Street N.W.
Farragut Square
[LOGO OF T. ROWE PRICE]
T. Rowe Price Investment Services, Inc., Distributor. F37-051 4/30/00
