<PAGE>
OPPENHEIMER TOTAL RETURN FUND, INC.
SEMI-ANNUAL REPORT JUNE 30, 1994
[Logo] OPPENHEIMERFUNDS
"WE HAVE LONG-TERM GOALS SO WE WANT TO TAKE ADVANTAGE OF THE STOCK MARKET'S
GROWTH OPPORTUNITIES, BUT WE KNOW THERE CAN BE VOLATILITY.
"THIS FUND INVESTS IN STOCKS AND BONDS. THAT MEANS WE GET THE POTENTIAL FOR
GROWTH FROM STOCKS AND INCOME FROM BONDS TO HELP CUSHION AGAINST VOLATILITY."
<PAGE>
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FUND FACTS
IN THIS REPORT:
ANSWERS TO THREE TIMELY QUESTIONS YOU SHOULD ASK YOUR FUND'S MANAGER.
- - DID THE FEDERAL RESERVE'S MOVES TO RAISE SHORT-TERM INTEREST RATES AFFECT THE
FUND'S PERFORMANCE OR INVESTMENT STRATEGY?
- - WITH THE DOLLAR'S RECENT DECLINE AND THE PICKUP IN OFFSHORE ECONOMIES, MANY
GLOBAL MARKETS MAY OUTPERFORM THE U.S. STOCK AND BOND MARKETS. IS THE FUND
DOING ANYTHING TO CAPITALIZE ON THESE OPPORTUNITIES?
- - IN THIS ECONOMIC AND MARKET ENVIRONMENT, WHERE ARE YOU FINDING THE MOST
ATTRACTIVE INVESTMENT OPPORTUNITIES?
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FACTS EVERY SHAREHOLDER SHOULD KNOW ABOUT
OPPENHEIMER TOTAL RETURN FUND
- --------------------------------------------------------------------------------
1 The Fund's objective is to seek high total return through a combination of
capital appreciation and income.
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2 Total returns at net asset value for Class A shares for the 6 and
12 months ended June 30, 1994 were -8.68% and -0.10%, respectively.
For Class B shares, total returns at net asset value for the same periods
were -9.10% and -1.04%, respectively.(1)
- --------------------------------------------------------------------------------
3 Average annual total returns for Class A shares for the 1-, 5-, and
10-year periods ended June 30, 1994 were -5.84%, 10.90% and 15.15%,
respectively. Average annual total returns for Class B shares for the
1-year period ended June 30, 1994 and since inception on May 1, 1993 were
-5.99% and -0.39%, respectively.(2)
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4 In recognition of its excellent long-term performance, the Fund's Class A
shares were awarded **** by Morningstar, Inc.(3) on June 30, 1994. The
Fund was ranked among 1,052 equity funds.
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5 "With its emphasis on mid-size growth company stocks and ability to
generate an above-average level of current income, this Fund is managed
somewhat more aggressively than most growth and income funds. The Fund
may have short-term fluctuations, but when you look back over the longer
term--three years, five years, ten years, and so on--many of our investors
did well."
PORTFOLIO MANAGER JOHN WALLACE, JUNE 30, 1994
(1) Based on the change in net asset value per share from 6/30/93 and 12/31/93
to 6/30/94, without deducting any sales charges.
(2) Average annual total returns are based on a hypothetical investment held
until 6/30/94, after deducting the maximum initial sales charge of 5.75% for
Class A shares and the contingent deferred sales charge of 5% (1-year) and 4%
(since inception) for Class B shares. The Fund's sales charge rate for Class A
shares was higher during a portion of some of the periods shown, and actual
investment results will be different as a result of the changes.
(3) Source: Morningstar Mutual Funds, 6/30/94. Morningstar, Inc., an independent
mutual fund monitoring service, produces proprietary monthly rankings of mutual
funds in broad investment categories (equity, taxable bond, tax-exempt bond, or
"hybrid") that reflect historical risk-adjusted performance based on a fund's
3-, 5-, and 10-year average annual total returns in excess of 90-day Treasury
bill returns, after considering expenses and sales charges. Risk is calculated
by a factor that reflects fund performance below 3-month U.S. Treasury bill
returns. Risk and returns are combined to produce star rankings, reflecting
risk-adjusted performance relative to the average fund in a category. The
highest ranking is 5 stars, the lowest, 1 star. The Fund was ranked among 1,052
equity funds of which 10% receive 5 stars, and 22.5% receive 4 stars. Rankings
are subject to change. The Fund's Class A and Class B shares have the same
portfolio.
All figures assume reinvestment of dividends and capital gains distributions.
Past performance is not indicative of future results. Investment and principal
value on an investment in the Fund will fluctuate so that an investor's shares,
when redeemed, may be worth more or less than the original cost.
2 Oppenheimer Total Return Fund, Inc.
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REPORT TO SHAREHOLDERS
ABOVE-AVERAGE LONG-TERM PERFORMANCE
Cumulative total return for the ten-year period ended 6/30/94
Oppenheimer Total Return Fund A(4) 309.94%
Lipper growth and income funds average(5) 248.80%
- --------------------------------------------------------------------------------
The six months ended June 30, 1994, was one of the most challenging periods U.S.
investors have seen in recent years. Both the stock and bond markets experienced
volatility, and Oppenheimer Total Return Fund was affected by these
fluctuations.
The main factor influencing the Fund's performance over the past
six months was, of course, the Federal Reserve's preemptive strike against
inflation. Four increases in short-term interest rates, running from early
February through mid-May, took a toll on the growth stocks your managers rely on
for capital gains, as well as on the telecommunications, utilities, and
convertible issues that provide the Fund's attractive current yield.
The Fed's actions seem to have had the desired effect on the
economy--inflation remains subdued, interest rates appear to have stabilized,
and the economy is growing at a modest, sustainable pace. In this environment,
we are confident that earnings will reemerge and replace interest rates as the
driving force behind stock prices, and your Fund is well positioned to benefit
as the markets resume their advance.
With the rise in interest rates, convertible securities became
extremely attractive, and we added to positions in several promising issues,
including Delta Airlines and Food Lion, a regional supermarket chain. At current
price levels, convertibles like these offer strong yields, which help insulate
the portfolio from price fluctuations, along with potential for capital
appreciation.
We also continued to invest in companies positioned to increase
market share and profits in the improving U.S. economy. Some purchases involved
special situations, such as General Electric, whose stock price was
disproportionately hurt by reports of problems in its financial services
subsidiary, and Rite-Aid, the nation's largest drugstore company, poised to
benefit from a major restructuring program.
Other purchases included industrial companies that should benefit from
the improving global economy, notably European automakers Fiat, Volvo, and
Volkswagen, whose stock performance should track that of Detroit's Big Three
automakers as the European economy recovers.
Looking ahead, the prospects for the Fund remain promising. While
day-to-day market volatility may be greater than we've seen in the past, the
economy is expanding at a sustainable pace, inflation remains well under
control, and well-managed companies are posting encouraging gains in market
share and profits.
We appreciate the trust you have placed in Oppenheimer Total Return
Fund, and we look forward to helping you meet your investment goals in the
future.
James C. Swain Jon S. Fossel
Chairman, Oppenheimer Total President, Oppenheimer Total
Return Fund, Inc. Return Fund, Inc.
July 22, 1994
4. Cumulative total return is based on a hypothetical investment held until
6/30/94, after deducting the maximum initial sales charge of 5.75% for Class A
shares.
5. Source of data: Lipper Analytical Services, Inc. an independent mutual fund
monitoring service, 6/30/94. Lipper total return averages for the 5 years ended
6/30/94 were for 103 growth and income funds. The average is shown for
comparative purposes only. Lipper performance rankings do not take sales charges
into consideration.
3 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Statement of Investments June 30, 1994 (Unaudited)
Face Market Value
Amount See Note 1
- ------
Repurchase Agreements--4.1%
- ------
Repurchase agreement with First Chicago Capital Markets, 4.22%, dated
6/30/94, to be repurchased at $63,907,491 on 7/1/94, collateralized by U.S.
Treasury Nts., 3.875%--9.25%, 12/31/94--11/30/98, with a value of $46,451,570
and U.S. Treasury Bills, 0%, 6/29/94, with a value of $18,750,465
(cost $63,900,000) $63,900,000 $63,900,000
- ------
Government Obligations--2.7%
- ------
Argentina (Republic of):
Bonds, Bonos de Consolidacion de Deudas:
Series I, 4.375%, 4/1/01(3)(4) 6,821,400 4,687,018
Par Bonds, 4%, 3/31/23(5) 8,778,700(6) 4,813,466
Par Bonds, 4%, 3/31/23(5) 5,000,000 2,518,750
Past Due Interest Bonds, 4.1875%, 3/31/05(3) 8,000,000 5,785,000
- ------
Brazil (Federal Republic of) Interest Due and Unpaid Bonds, 8.75, 1/1/01(3)
9,900,000 6,892,875
- ------
Spain (Kingdom of) Gtd. Bonds, Bonos y Obligacion del Estado, 12.25%, 3/25/00
500,000,000(6) 4,089,072
- ------
United Mexican States Gtd. Cv. Bonds, Series B, 6.25%, 12/31/19 15,000,000
9,553,125
- ------
United Mexican States, 4.32813% Notes 12/31/19 5,000,000 4,125,000
- ------
Total Government Obligations (Cost $50,573,489) 42,464,306
- ------
Corporate Bonds and Notes--6.2%
- ------
Air Express International Corp., 6% Cv. Sub. Debs. 1/15/03 3,500,000
3,141,250
- ------
Banco Nacional de Comercio Exterior SNC International Finance
BV, 8% Gtd. Matador Bonds, 8/5/03(2) 6,000,000 5,100,000
- ------
Banco Nacional de Mexico SA, 7%, Exch. Sub. Debs., 12/15/99(2) 5,000,000
5,350,000
- ------
Box Energy Corp., 8.25% Cv. Sub. Nts., 12/1/02 3,000,000 3,127,500
- ------
Calfed, Inc., 10% Sub. Debs., 1/3/03 169,100 169,100
- ------
Chiron Corp., 1.90% Cv. Sub. Nts., 11/17/00(2) 8,000,000 5,440,000
- ------
Citibank CD, 17%, 8/10/94 1,228,200,000(6) 2,938,372
- ------
Coeur d'Alene Mines Corp., 6.375% Cv. Sub. Debs., 1/31/04 6,500,000
5,947,500
- ------
Comcast Corp., 1.125% Cv. Sub. Disc. Debs., 4/15/07 5,000,000 2,206,250
- ------
Cross Timbers Oil Co., 5.25% Cv. Sub. Nts., 11/1/03 3,500,000 2,966,250
- ------
Delta Airlines, Inc., 3.23% Cv. Sub. Nts., 6/15/03 12,000,000 8,265,000
- ------
Employee Benefit Plans, Inc., 6.75% Cv. Sub. Debs., 7/31/06 3,000,000
2,220,000
- ------
Food Lion, Inc., 5.00% Sub. Debs., 6/1/03(2) 4,000,000 3,840,000
- ------
Genesis Health Ventures, Inc., 6% Cv. Sr. Sub. Debs., 11/30/03 1,500,000
1,830,000
- ------
Healthsouth Rehabilitation, 5.00% Cv. Sub. Debs., 4/1/01 3,000,000
2,895,000
- ------
Integrated Health Services, Inc., 5.75% Cv. Sub. Debs., 1/1/01(2) 3,000,000
3,195,000
- ------
Interpool, Inc., 5.25% Cv. Sub. Nts. Exch., 12/15/18 5,000,000 4,025,000
- ------
Kelly Oil & Gas Partners Ltd., 7.875% Cv. Sub. Nts., 12/15/99 2,500,000
1,859,375
- ------
Novacare, Inc., 5.50% Cv. Sub. Debs., 1/15/00 4,000,000 3,735,000
- ------
Pharmaceutical Marketing Services, Inc., 6.25% Cv. Sub. Debs., 2/1/03(2)
2,750,000 1,938,750
- ------
Physicians Clinical Laboratory, Inc., 7.5% Cv. Sub. Debs., 8/15/00(2)(8)
4,000,000 4,015,000
- ------
Roadmaster Industries, Inc., 8% Cv. Sub. Debs., 8/15/03 3,500,000
3,727,500
- ------
Seagate Technology, 6.75%, Cv. Sub. Debs., 5/1/12 6,000,000 5,055,000
- ------
Shangri-La Asia Ltd., 2.875% Cv. Sub. Debs., 6/6/00(2) 4,300,000
3,547,500
- ------
Stone Container Corp., 6.75% Debs., 2/15/07 3,000,000 2,235,000
4 Oppenheimer Total Return Fund, Inc.
<PAGE>
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Face Market Value
Amount See Note 1
- ------
Corporate Bonds and Notes
(continued)
Time Warner, Inc., 8.75% Sr. Nts., 1/10/15 $4,000,000 $4,015,000
- ------
Titan Wheel International, Inc., 4.75% Cv. Sub. Nts., 12/1/00 4,000,000
3,940,000
- ------
Willcox & Gibbs, Inc., 7% Cv. Sub. Debs., 8/1/14 2,000,000 1,645,000
- ------
Total Corporate Bonds and Notes (Cost $99,003,788) 98,369,347
Units
- ------
Indexed Instruments--1.0%
- ------
Nikkei Index Rel. Perform. Call 750,000 2,970,000
- ------
SP/NASD Rel. Perform. Call 1,250,000 12,441,000
- ------
Total Indexed Instruments (Cost $15,092,500) 15,411,000
- ------
Rights and Warrants--0.1%
- ------
Banco Santander-Rts., Exp. 6/94 225,000 1,230,996
- ------
Daimler Benz AKT-ADR Rts., Exp. 7/94 225,000 98,438
- ------
M.S. Japan INX Call Wts., Exp. 5/96(1) 60,000 345,000
- ------
Total Rights and Warrants (Cost $11,103,940) 1,674,434
Shares
Subject
Date/Price to Put
- ------
Put Options Purchased--0.0%
- ------
Creative Technologies Oct./$17.50 200 70,000
- ------
Best Buy Co., Inc. Sept./$20 600 30,000
- ------
Best Buy Co., Inc. Sept./$25 200 27,500
- ------
Octel Communications Corp. Aug./$17.50 520 91,000
- ------
Oracle Systems Aug./$30 250 9,375
- ------
Oracle Systems Aug./$35 550 75,625
- ------
Storage Technology Jul./$30 200 17,500
- ------
Storage Technology Aug./$30 400 75,000
- ------
Sybase Inc. Aug./$45 250 59,375
- ------
3COM Corp. Aug./$40 500 37,500
- ------
Total Put Options Purchased (Cost $630,995) 492,875
Shares
- ------
Preferred Stocks--8.3%
- ------
Agco Corp., Cv. 110,000 5,445,000
- ------
AMR Corp., $3.00 Cum. Cv. Depositary Shares, Series A(2) 400,000
17,700,000
- ------
Boise Cascade Corp., $1.58 Cum Cv., Series G 390,000 8,385,000
- ------
Catellus Development Corp., $3.625 Cv., Series B(2) 250,000 10,500,000
- ------
Chemical Banking Corp., $5.00 Cv.(2) 110,000 8,360,000
- ------
Chiles Offshore Corp., $1.50 Cv. 150,000 3,412,500
- ------
Compania Inversiones Tel, Cv. $62.00 Preferred Redeemable
Increased Dividend Equity Securities(1)(2) 150,000 8,925,000
- ------
Freeport-McMoRan Copper & Gold, Inc., Cv. Exch. Depositary Shares 320,000
7,240,000
- ------
Gensia, Inc.(2) 45,000 1,125,000
- ------
Hecla Mining Co., $3.50 Cv., Series B 80,000 3,960,000
- ------
James River Corp.(1) 600,000 10,575,000
- ------
Lynx Therapeutics, Inc., Series A(1)(2) 91,200 91,200
5 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Statement of Investments (Unaudited) (Continued)
Market Value
Shares See Note 1
- ------
Preferred Stocks (continued)
Nafin 11.25% (TMX) Provisionally Redeemable Income Debt 100,000
$6,125,000
- ------
Nextel Communication, 5.50%, Pfd. 315,000 10,276,875
- ------
Noble Drilling Corp., $2.25 Cv. Exch., Series A 130,000 5,525,000
- ------
Occidental Petroleum Corp. 150,000 6,206,250
- ------
Olympic Financial Ltd., $2.00 Cum. Cv. Exch. 100,000 2,825,000
- ------
Reynolds Metals Co., $3.31 Cv. 112,500 5,610,938
- ------
Transco Energy Co., $3.00 Cum. Cv., Series E(2) 105,000 5,066,250
- ------
Unisys Corp., $3.75 Cv., Series A 125,000 4,296,875
- ------
Total Preferred Stocks (Cost $135,484,207) 131,650,888
- ------
Common Stocks--77.5%
- ------
Basic Materials--4.6%
- ------
Chemicals--3.1% Eastman Chemical Co. 150,000 7,162,500
- ------
Geon Co. (The) 325,000 8,450,000
- ------
Great Lakes Chemical Corp. 175,000 9,471,875
- ------
Imperial Chemical Industries PLC, ADS(1) 200,000 9,500,000
- ------
Lyondell Petrochemical Co. 350,000 8,618,750
- ------
Union Carbide Corp. 200,000 5,350,000
- ------
48,553,125
- ------
Gold--0.4% Cyprus Amax Minerals Co. 200,000 5,950,000
- ------
Metal: Miscellaneous--0.3% Material Sciences Corp.(1) 200,000
4,450,000
- ------
Metals: Diversified--0.5% Birmingham Steel Corp. 265,000 7,155,000
- ------
Steel--0.3% Oregon Steel Mills, Inc. 225,000 4,303,125
- ------
Consumer Cyclicals--16.5%
- ------
Airlines--1.4% Atlantic Southeast Airlines, Inc. 625,000 15,156,250
- ------
Continental Airlines, Inc., Cl. B(1) 500,000 6,437,500
- ------
21,593,750
- ------
Automobiles--4.7% Daimler-Benz AKT(1) 225,000 10,181,250
- ------
Fiat SpA Di Risp.(1) 2,700,000 6,447,042
- ------
Fiat SpA, Preference(1) 5,000,000 12,428,528
- ------
General Motors Corp. 225,000 11,306,250
- ------
Harley-Davidson, Inc. 250,000 11,437,500
- ------
Volkswagen AG(1) 35,000 10,424,469
- ------
Volvo AB, Series B Free(1) 144,500 12,598,766
- ------
74,823,805
- ------
Entertainment--0.3% Iwerks Entertainment, Inc.(1)(8) 600,000
3,975,000
- ------
Hotels/Motels--0.8% Carnival Cruise Lines, Inc., Cl. A 270,000
11,947,500
- ------
Household Furnishings
And Appliances--0.6%
Baldwin Piano & Organ Co.(1)(8) 256,000 3,360,000
- ------
Shaw Industries, Inc. 400,000 6,600,000
- ------
9,960,000
6 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Market Value
Shares See Note 1
- ------
Leisure Time--2.0% Bally Gaming International, Inc.(1) 421,000
$5,157,250
- ------
Brunswick Corp. 225,000 4,950,000
- ------
Caesar's World, Inc.(1) 150,000 5,437,500
- ------
Eastman Kodak Co. 250,000 12,031,250
- ------
Outboard Marine Corp. 200,000 4,000,000
- ------
31,576,000
- ------
Publishing--0.9% American Greetings Corp., Cl. A 475,000 14,250,000
- ------
Retail: Specialty--3.3% Alco Standard Corp. 125,000 7,140,625
- ------
Lowe's Cos., Inc. 397,000 13,597,250
- ------
Regis Corp. of Minnesota(1)(8) 650,000 8,450,000
- ------
Rite Aid Corp. 915,000 18,528,750
- ------
Spiegel, Inc., Cl. A 250,000 4,750,000
- ------
52,466,625
- ------
Retail Stores: Federated Department Stores, Inc.(1) 175,000
3,500,000
Department Stores--0.2%
- ------
Retail Stores: General
Merchandise Chains--1.4%
Fingerhut Cos., Inc. 550,000 13,337,500
- ------
Meyer (Fred), Inc.(1) 250,000 9,093,750
- ------
22,431,250
- ------
Shoes--0.8% Nike, Inc., Cl. B 200,000 11,950,000
- ------
Textiles: Apparel Chic by H.I.S., Inc.(1) 146,200 1,827,500
Manufacturers--0.1%
- ------
Consumer Non-Cyclicals--8.1%
- ------
Drugs--0.4% Astra AB Free, Series A 350,000 7,059,681
- ------
Food Processing--0.7% McCormick & Co., Inc., Non-Vtg. 450,000
9,112,500
- ------
Ralston-Continental Baking Group 200,000 975,000
- ------
10,087,500
- ------
Healthcare: Diversified--0.7% Bristol-Myers Squibb Co. 205,000
10,993,125
- ------
Healthcare: Miscellaneous--2.2% COR Therapeutics, Inc.(1) 500,000
5,875,000
- ------
Dentsply International, Inc.(1) 225,000 7,875,000
- ------
Healthsource, Inc.(1) 400,000 11,400,000
- ------
PCI Services, Inc.(1) 300,000 2,812,500
- ------
United Healthcare Corp.(7) 149,500 6,858,313
- ------
34,820,813
- ------
Hospital Management--1.5% Community Psychiatric Centers 328,500
3,900,938
- ------
Homecare Mgmt. Inc.(1) 175,000 2,537,500
- ------
Living Centers of America, Inc.(1) 175,000 5,031,250
- ------
Sun Healthcare Group, Inc.(1) 200,000 3,725,000
- ------
Wellpoint Health Networks, Inc., Cl. A(1) 300,000 8,850,000
- ------
24,044,688
7 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Statement of Investments (Unaudited) (Continued)
Market Value
Shares See Note 1
- ------
Medical Products--1.5% Lynx Therapeutics, Inc.(1)(2) 62,700 $12,540
- ------
Medtronic, Inc. 175,000 14,021,875
- ------
St. Jude Medical, Inc. 67,500 2,193,750
- ------
Sybron Corp. of Delaware(1) 201,500 6,045,000
- ------
22,273,165
- ------
Tobacco--1.1% Philip Morris Cos., Inc. 350,000 18,025,000
- ------
Energy--5.1%
- ------
Oil: Integrated
Domestic--1.5%
Atlantic Richfield Co. 150,000 15,318,750
- ------
Seagull Energy Corp.(1) 225,000 5,821,875
- ------
Trident NGL Holding, Inc. 275,000 2,681,250
- ------
23,821,875
- ------
Oil: Integrated
International--2.0%
Amerada Hess Corp. 200,000 9,850,000
- ------
Repsol SA 200,000 5,725,000
- ------
Societe Nationale Elf Acquitaine(1) 225,000 15,646,219
- ------
31,221,219
- ------
Oil and Gas Drilling--0.3% Cross Timbers Oil Co. 135,000 1,890,000
- ------
Noble Drilling Corp.(1) 400,000 3,200,000
- ------
5,090,000
- ------
Oil Well Services
And Equipment--1.3%
Dresser Industries Inc. 350,000 7,175,000
- ------
McDermott International, Inc. 250,000 6,250,000
- ------
Western Atlas, Inc.(1) 160,000 7,620,000
- ------
21,045,000
- ------
Financial--9.3%
- ------
Financial Services:
Miscellaneous--1.3%
First Financial Caribbean Corp. 58,300 641,300
- ------
H & R Block Incorporated 275,000 10,793,750
- ------
Travelers, Inc. 280,000 9,030,000
- ------
20,465,050
- ------
Insurance: Life--0.4% Bankers Life Holding Corp. 350,000 7,043,750
- ------
Insurance: Multi-Line--0.4% CCP Insurance, Inc. 320,000 6,520,000
- ------
Major Banks: Other--1.1% American Federal Bank, FSB 225,000
2,475,000
- ------
Banco de Santander SA(1) 225,000 8,095,507
- ------
Westpac Banking Corp., Sponsored ADR 425,000 6,853,125
- ------
17,423,632
- ------
Major Banks: Regional--4.4% CoreStates Financial Corp. 540,000
13,905,000
- ------
First Interstate Bancorp 210,000 16,170,000
- ------
Midlantic Corp. 275,000 8,043,750
- ------
Norwest Corp. 285,000 7,445,625
- ------
Signet Banking Corp. 250,000 10,093,750
8 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Market Value
Shares See Note 1
- ------
Major Banks: Regional
(continued)
Summit Bancorporation (The) 200,000 $4,325,000
- ------
U.S. Bancorp, Inc. 200,000 5,175,000
- ------
UJB Financial Corp. 150,000 4,143,750
- ------
69,301,875
- ------
Money Center Banks--0.5% First Chicago Corp. 155,000 7,459,375
- ------
Savings and
Loans/Holding Cos.--1.2%
Onbancorp, Inc. 340,000 10,370,000
- ------
TCF Financial Corp. 250,000 8,468,750
- ------
18,838,750
- ------
Industrial--9.0%
- ------
Building Materials Group--0.6% Centex Construction Products, Inc.(1)
470,000 5,581,250
- ------
Owens-Corning Fiberglass Corp.(1) 125,000 3,890,625
- ------
9,471,875
- ------
Commercial Services--0.2% Manpower, Inc. 170,000 3,570,000
- ------
Conglomerates--2.5% Litton Industries, Inc.(1) 425,000 14,290,625
- ------
Philips NV(1) 450,000 12,937,500
- ------
Tenneco, Inc. 275,000 12,753,125
- ------
39,981,250
- ------
Electrical Equipment--1.0% General Electric Co. 350,000 16,318,750
- ------
Manufacturing:
Diversified Industrial--2.1%
AlliedSignal, Inc. 375,000 12,984,375
- ------
Trinity Industries, Inc. 275,000 9,659,375
- ------
Tyco Laboratories, Inc. 231,000 10,568,250
- ------
33,212,000
- ------
Railroads--1.2% Santa Fe Pacific Corp. 250,000 5,218,750
- ------
Southern Pacific Rail Corp.(1) 675,000 13,246,875
- ------
18,465,625
- ------
Transportation:
- ------
Miscellaneous--0.1% Stolt Comex Seaway SA(1) 175,000 1,531,250
- ------
Truckers--1.3% Roadway Services, Inc 220,000 13,860,000
- ------
TNT Freightways Corp. 300,000 6,900,000
- ------
20,760,000
- ------
Technology--14.9%
- ------
Aerospace/Defense--1.0% Martin Marietta Corp. 350,000 15,443,750
- ------
Computer Software
And Services--5.2%
Banyan Systems, Inc.(1) 24,000 309,000
- ------
Cadence Design Systems(1) 200,000 3,350,000
- ------
EMC Corp.(1) 155,000 2,092,500
- ------
Exabyte Corp.(1) 250,000 3,562,500
- ------
Intersolv, Inc.(1) 179,400 1,928,550
- ------
Legent Corp.(1) 200,000 5,400,000
- ------
Microsoft Corp.(1)(7) 200,000 10,300,000
- ------
Oracle Systems Corp.(1)(7) 200,000 7,500,000
9 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Statement of Investments (Unaudited) (Continued)
Market Value
Shares See Note 1
- ------
Computer Software
And Services (continued)
Parametric Technology Corp.(1) 100,000 $2,262,500
- ------
Platinum Technology, Inc.(1) 300,000 3,900,000
- ------
Reynolds & Reynolds Co., Cl. A 275,000 6,359,375
- ------
SHL Systemhouse, Inc.(1) 1,932,000 12,316,500
- ------
Sap AG, Preference 5,300 10,640,310
- ------
Sierra On-Line, Inc.(1) 200,000 3,300,000
- ------
Sligos SA(1) 68,260 5,485,732
- ------
Sybase, Inc.(1) 75,000 3,675,000
- ------
82,381,967
- ------
Computer Systems--0.9% Auspex Systems, Inc.(1) 450,000 2,250,000
- ------
Komag Incorporated(1) 150,000 2,775,000
- ------
Seagate Technology(1) 100,000 1,975,000
- ------
Sensormatic Electronics Corp. 250,000 7,187,500
- ------
14,187,500
- ------
Electronics:
Instrumentation--1.2%
Belden, Inc. 400,000 7,400,000
- ------
Thermo Electron Corp.(1) 307,500 11,454,375
- ------
18,854,375
- ------
Electronics:
Semiconductors--1.5%
Actel Corp.(1) 333,500 3,001,500
- ------
Applied Materials, Inc.(1) 150,000 6,412,500
- ------
Dallas Semiconductor Corp.(1) 145,000 2,628,125
- ------
Intel Corp.(7) 200,000 11,700,000
- ------
23,742,125
- ------
Office Equipment
And Supplies--0.8% Moore Corp. Ltd. 750,000 12,656,250
- ------
Telecommunications--4.3% Airtouch Communications, Inc.(1) 525,000
12,403,125
- ------
Ericsson Telefonaktiebolaget(1) 111,800 5,586,739
- ------
LCI International, Inc.(1) 312,500 10,000,000
- ------
LDDS Communications, Inc., Cl. A(1) 200,000 3,500,000
- ------
McCaw Cellular Communications, Inc.(1) 250,000 12,937,500
- ------
Millicom International Cellular SA(1) 749,000 15,541,750
- ------
Tele Danmark A.S.(1) 343,000 8,446,375
- ------
68,415,489
- ------
Utilities--10.0%
- ------
Electric Cos.--5.7% Allegheny Power System, Inc. 250,000 5,250,000
- ------
FPL Group, Inc. 500,000 14,937,500
- ------
Houston Industries, Inc. 675,000 22,021,875
- ------
Pacific Gas & Electric Co. 200,000 4,750,000
- ------
Public Service Enterprise Group, Inc. 725,000 18,850,000
- ------
Texas Utilities Co. 625,000 19,609,375
- ------
Union Electric Co. 150,000 4,762,500
- ------
90,181,250
10 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Market Value
Shares See Note 1
- ------
Natural Gas--1.5% Equitable Resources, Inc. 150,000 $5,156,250
- ------
Williams Cos., Inc. (The) 650,000 18,606,250
- ------
23,762,500
- ------
Telephone--2.8% Bell Atlantic Corp. 250,000 14,000,000
- ------
GTE Corp. 400,000 12,600,000
- ------
Societa Italiana per L'Eserrcizio delle Telecomunicazion SPA(1) 3,500,000
8,711,024
- ------
Telecommunication de Argentina, Cl. B(1) 500,000 2,579,848
- ------
U S West, Inc. 150,000 6,281,250
- ------
44,172,122
- ------
Total Common Stocks (Cost $1,156,537,954) 1,223,355,256
- ------
Total Investments, at Value (Cost $1,532,326,873) 99.9% 1,577,318,106
- ------
Other Assets Net of Liabilities 0.1 1,297,514
- ------ ------
Net Assets 100.0 % $1,578,615,620
- ------ ------
- ------ ------
1. Non-income producing security.
2. Restricted Security--See Note 6 of Notes to Financial Statements.
3. Represents the current interest rate for a variable rate security.
4. Interest or dividend is paid in kind.
5. Represents the current interest rate for an increasing rate security.
6. Face Amount is reported in foreign currency.
7. Securities with an aggregate market value of $11,018,750 are held in escrow
to cover outstanding call options, as follows:
Market
Shares Expiration Exercise Premium Value
Subject to Call Date Price Received See
Note 1
- ------
Intel 25,000 7/94 $.60 $48,698 $26,563
Microsoft 50,000 7/94 52.50 92,247 43,750
Oracle Systems 125,000 7/94 35.00 254,079 359,375
United Health 50,000 8/94 45.00 192,244 146,875
- ------ ------ ------
250,000 587,268 576,563
8. Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer and is or was an affiliate, as defined in the
Investment Company Act of 1940, at or during the six months ended June 30, 1994.
The aggregrate fair value of all securities of affiliate companies as of June
30, 1994 amounted to $19,800,000. Transactions during the period in which the
issuer was an affiliate are as follows:
Balance Balance
December 31, 1993 Gross Additions Gross Reductions June 30, 1994
- ------ ------ ------ ------
Shares/Face Cost Shares/Face Cost Shares/Face Cost
Shares/Face Cost
- ------
Baldwin Piano & Organ Co. 256,000 $4,418,500 -- $-- --
$-- 256,000 $4,418,500
- ------
Iwerks Entertainment, Inc. 465,000 14,569,045 145,000 3,267,500
10,000 260,000 600,000 17,576,545
- ------
Physicians Clinical
Laboratory, Inc., 7.50%
Cv. Sub. Debs., 8/15/00 4,000,000 4,000,000 -- -- -- --
4,000,000 4,000,000
- ------
Regis Corp. 650,000 6,964,363 -- -- -- -- 650,000
6,964,363
- ------ ------ ------ ------
$29,951,908 $3,267,500 $260,000 $32,959,408
- ------ ------ ------ ------
- ------ ------ ------ ------
9. Not an affiliate as of June 30, 1994.
See accompanying Notes to Financial Statements.
11 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Statement of Assets and Liabilities June 30, 1994 (Unaudited)
- ------
Assets Investments, at value (cost $1,532,326,873)--see accompanying
statement $1,577,318,106
- ------
Cash 857,235
- ------
Receivables:
Investments sold 29,214,566
Shares of capital stock sold 7,634,588
Dividends and interest 6,480,369
- ------
Other 173,380
- ------
Total assets 1,621,678,244
- ------
Liabilities Options written, at value (premiums received $587,268)--see
accompanying
statement--Note 4 576,563
- ------
Payables and other liabilities:
Investments purchased 36,546,582
Shares of capital stock redeemed 4,837,140
Distribution and service plan fees--Note 5 742,407
Other 359,932
- ------
Total liabilities 43,062,624
- ------
Net assets $1,578,615,620
- ------
- ------
- ------
Composition of
Net Assets
Par value of shares of capital stock $20,165,624
- ------
Additional paid-in capital 1,519,510,684
- ------
Distributions in excess of net investment income (1,013,760)
Distributions in excess of net realized loss from investment, written option
and foreign currency transactions (5,063,614)
- ------
Net unrealized appreciation on investments and translation of assets
and liabilities denominated in foreign currencies 45,016,686
- ------
Net Assets $1,578,615,620
- ------
- ------
- ------
Net Asset Value
Per Share
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$1,216,264,077
and 155,172,741 shares of capital stock outstanding) $7.84
Maximum offering price per share (net asset value plus sales charge of 5.75% of
offering price) $8.32
- ------
Class B Shares:
Net asset value, redemption price and offering price per share (based on net
assets
of $362,341,957 and 46,482,277 shares of capital stock outstanding) $7.80
- ------
Class Y Shares:
Net asset value, redemption price and offering price per share (based on net
assets
of $9,586 and 1,223 shares of capital stock outstanding) $7.84
See accompanying Notes to Financial Statements.
12 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Statement of Operations For the Six Months Ended June 30, 1994 (Unaudited)
- ------
Investment Income Dividends (net of withholding taxes of $350,108)
$20,956,520
- ------
Interest 6,635,609
- ------
Total income 27,592,129
- ------
Expenses Management fees--Note 5 4,254,204
- ------
Distribution and service plan fees:
Class A--Note 5 1,086,980
Class B--Note 5 1,510,085
- ------
Transfer and shareholder servicing agent fees--Note 5 1,264,007
- ------
Shareholder reports 302,728
- ------
Registration and filing fees:
Class A 89,258
Class B 72,957
Class Y 2
- ------
Custodian fees and expenses 127,038
- ------
Legal and auditing fees 43,548
- ------
Directors' fees and expenses 35,690
Other 211,377
- ------
Total expenses 8,997,874
- ------
Net Investment Income 18,594,255
- ------
Realized and Unrealized
Gain (Loss) on Investments,
Options Written
And Foreign Currency
Transactions
Net realized gain (loss) from:
Investments 1,274,293
Closing of option contracts written--Note 4
Foreign currency transactions (134,961)
- ------
Net change in unrealized appreciation or depreciation on:
Investments (169,412,549)
Translation of assets and liabilities denominated in foreign currencies
226,236
Net realized and unrealized gain on investments, options written and foreign
currency transactions (168,046,981)
- ------
Net Decrease in Net Assets Resulting From Operations $(149,452,726)
- ------
- ------
See accompanying Notes to Financial Statements.
13 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Statements of Changes in Net Assets
Six Months Ended Year Ended
June 30, 1994 December 31,
(Unaudited) 1993
- ------
Operations Net investment income $18,594,255 $22,572,620
- ------
Net realized gain on investments, options written
and foreign currency transactions 1,139,332 82,466,024
- ------
Net change in unrealized appreciation or depreciation
on investments, options written and translation of assets and
liabilities denominated in foreign currencies (169,186,313) 93,114,925
Net increase in net assets resulting from operations (149,452,726)
198,153,569
- ------
Equalization Net change 3,854,582
- ------
Dividends and
Distributions to
Shareholders
Dividends from net investment income:
Class A ($.10 and $.20 per share, respectively) (15,181,370)
(23,576,552)
Class B ($.076 and $.1091 per share, respectively) (3,059,844)
(1,142,362)
Class Y ($.05 per share) (61) --
- ------
Distributions from net realized gain on investments, options written
and foreign currency transactions:
Class A ($.5834 per share) -- (76,215,894)
Class B ($.5834 per share) -- (13,016,692)
- ------
Capital Stock
Transactions
Net increase in net assets resulting from Class A
capital stock transactions--Note 2 123,942,753 335,283,270
- ------
Net increase in net assets resulting from Class B
capital stock transactions--Note 2 180,245,858 223,296,915
- ------
Net increase in net assets resulting from Class Y
capital stock transactions--Note 2 10,061 --
- ------
Net Assets Total increase 136,504,671 646,636,836
- ------
Beginning of period 1,442,110,949 795,474,113 ------ ------
End of period [including undistributed net investment income
of $(397,294) and $3,054,070, respectively] $1,578,615,620
$1,442,110,949
- ------ ------
- ------ ------
See accompanying Notes to Financial Statements.
14 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Financial Highlights
Class A Class B Class Y
- ------ ------ ------
Six Months Six Months Period
Period
Ended Ended Ended Ended
June 30, 1994 Year Ended December 31, June 30, 1994 December
31, June 30, 1994
(Unaudited) 1993 1992 1991 1990 1989 (Unaudited)
1993 (1) (Unaudited)(2)
- ------
Per Share Operating Data:
Net asset value, beginning of period $8.69 $7.84 $7.49 $6.13
$6.68 $6.35 $8.66 $8.23 $8.23
- ------
Income (loss) from investment operations:
Net investment income .13 .18 .17 .24 .24 .27 .08
.09 .03
Net realized and unrealized gain (loss)
on investments, options written
and foreign currency transactions (.88) 1.45 .75 1.91 (.49)
.93 (.86) 1.03 (.37)
- ------ ------ ------ ------ ------ ------ ------
- ------ ------
Total income (loss) from
investment operations (.75) 1.63 .92 2.15 (.25) 1.20
(.78) 1.12 (.34)
- ------
Dividends and distributions
to shareholders:
Dividends from net investment income (.10) (.20) (.20) (.23)
(.24) (.28) (.08) (.11) (.05)
Distributions from net realized gain
on investments, options written and
foreign currency transactions -- (.58) (.37) (.56) (.06)
(.59) -- (.58) --
- ------ ------ ------ ------ ------ ------ ------
- ------ ------
Total dividends and distributions
to shareholders (.10) (.78) (.57) (.79) (.30) (.87)
(.08) (.69) (.05)
- ------
Net asset value, end of period $7.84 $8.69 $7.84 $7.49 $6.13
$6.68 $7.80 $8.66 $7.84
- ------ ------ ------ ------ ------ ------ ------
- ------ ------
- ------ ------ ------ ------ ------ ------ ------
- ------ ------
- ------
Total Return, at Net Asset Value(3) (8.68%) 21.24% 12.83% 36.26%
(3.86)% 19.25% (9.10%) 13.91% (4.13)%
- ------
Ratios/Supplemental Data:
Net assets, end of period
(in thousands) $1,216,264 $1,223,395 $795,474 $555,865
$396,240 $389,413 $362,342 $218,716 $10
- ------
Average net assets (in thousands) $1,261,997 $992,381 $662,917
$475,741 $394,903 $356,994 $304,146 $90,952 $10
- ------
Number of shares outstanding at
end of period (in thousands) 155,173 140,711 101,433 74,245
64,644 58,333 46,482 25,261 1
- ------
Ratios to average net assets:
Net investment income 2.57%(4) 2.21% 2.68% 3.26% 3.87%
3.96% 1.77%(4) 1.09%(4) 2.95%(4)
Expenses .99%(4) .93% .96% .95% .98% .98% 1.86%(4)
1.87%(4) .87%(4)
- ------
Portfolio turnover rate(5) 61.9% 143.9% 143.5% 161.5% 114.1%
151.6% 61.9% 143.9% 61.9%
1. For the period from May 1, 1993 (inception of offering) to December 31, 1993.
2. For the period from June 1, 1994 (inception of offering) to June 30, 1994.
3. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period, with all dividends and distributions reinvested
in additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Sales charges
are not reflected in the total returns.
4. Annualized.
5. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the six
months ended June 30, 1994 were $1,207,519,031 and $945,916,474, respectively.
See accompanying Notes to Financial Statements.
15 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Notes to Financial Statements (Unaudited)
- ------
1. Significant
Accounting Policies
Oppenheimer Total Return Fund, Inc. (the Fund) is registered under the
Investment Company Act of 1940, as amended, as a diversified, open-end
management investment company. The Fund's investment advisor is Oppenheimer
Management Corporation (the Manager). The Fund offers Class A, Class B and Class
Y shares. Class A shares are sold with a front-end sales charge. Class B shares
may be subject to a contingent deferred sales charge. All three classes of
shares have identical rights to earnings, assets and voting privileges, except
that each class has its own expenses directly attributable to a particular class
and exclusive voting rights with respect to matters affecting a single class.
Class A and Class B has its own distribution and/or service plan. Class B shares
will automatically convert to Class A shares six years after the date of
purchase. The following is a summary of significant accounting policies
consistently followed by the Fund.
- ------
Investment Valuation. Portfolio securities are valued at 4:00 p.m. (New York
time) on each trading day. Listed and unlisted securities for which such
information is regularly reported are valued at the last sale price of the day
or, in the absence of sales, at values based on the closing bid or asked price
or the last sale price on the prior trading day. Long-term debt securities are
valued by a portfolio pricing service approved by the Board of Directors.
Long-term debt securities which cannot be valued by the approved portfolio
pricing service are valued by averaging the mean between the bid and asked
prices obtained from two active market makers in such securities. Short-term
debt securities having a remaining maturity of 60 days or less are valued at
cost (or last determined market value) adjusted for amortization to maturity of
any premium or discount. Securities for which market quotes are not readily
available are valued under procedures established by the Board of Directors to
determine fair value in good faith. A call option is valued based upon the last
sales price on the principal exchange on which the option is traded or, in the
absence of any transactions that day, the value is based upon the last sale on
the prior trading date if it is within the spread between the closing bid and
asked prices. If the last sale price is outside the spread, the closing bid or
asked price closest to the last reported sale price is used.
- ------
Foreign Currency Translation. The accounting records of the Fund are maintained
in U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars at the closing rates of exchange. Amounts related
to the purchase and sale of securities and investment income are translated at
the rate of exchange prevailing on the respective dates of such transactions.
The Fund generally enters into forward currency exchange contracts as a hedge,
upon the purchase or sale of a security denominated in a foreign currency. Risks
may arise from the potential inability of the counterparty to meet the terms of
the contract and from unanticipated movements in the value of a foreign currency
relative to the U.S. dollar. The effect of changes in foreign currency exchange
rates on investments is separately identified from the fluctuations arising from
changes in market values of securities held and reported with all other foreign
currency gains and losses in the Fund's results of operations.
- ------
Repurchase Agreements. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. If the seller of the agreement defaults and the value of
the collateral declines, or if the seller enters an insolvency proceeding,
realization of the value of the collateral by the Fund may be delayed or
limited.
- ------
Call Options Written. The Fund may write covered call options. When an option is
written, the Fund receives a premium and becomes obligated to sell the
underlying security at a fixed price, upon exercise of the option. In writing an
option, the Fund bears the market risk of an unfavorable change in the price of
the security underlying the written option. Exercise of an option written by the
Fund could result in the Fund selling a security at a price different from the
current market value. All securities covering call options written are held in
escrow by the custodian bank.
- ------
Allocation of Income, Expenses and Gains and Losses. Income, expenses (other
than those attributable to a specific class) and gains and losses are allocated
daily to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- ------
Federal Income Taxes. The Fund intends to continue to comply with provisions of
the Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income tax provision is required.
16 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Distributions to Shareholders. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- ------
Change in Accounting for Distributions to Shareholders. Effective January 1,
1994, the Fund adopted Statement of Position 93-2: Determination, Disclosure,
and Financial Statement Presentation of Income, Capital Gain, and Return of
Capital Distributions by Investment Companies. As a result, the Fund changed the
classification of distributions to shareholders to better disclose the
differences between financial statement amounts and distributions determined in
accordance with income tax regulations. Accordingly, subsequent to December 31,
1993, amounts have been reclassified to reflect a decrease in paid in capital of
$45,281, a decrease in undistributed net investment income of $616,465, and an
increase in undistributed capital loss on investments of $661,746.
- ------
Other. Investment transactions are accounted for on the date the investments are
purchased or sold (trade date) and dividend income is recorded on the
ex-dividend date. Discount on securities purchased is amortized over the life of
the respective securities, in accordance with federal income tax requirements.
Realized gains and losses on investments and options written and unrealized
appreciation and depreciation are determined on an identified cost basis, which
is the same basis used for federal income tax purposes.
- ------
2. Shares of
Capital Stock
The Fund has authorized 450,000,000, 200,000,000, and 50,000,000 shares of $.10
par value Class A, Class B and Class Y capital stock, respectively. Transactions
in shares of capital stock were as follows:
Six Months Ended Year Ended
June 30, 1994 (Unaudited)(1) December 31, 1993 (2)
- ------
Shares Amount Shares Amount
- ------
Class A:
Sold 23,601,755 $202,074,315 40,537,799 $349,550,087
Dividends and distributions reinvested 1,681,244 13,886,083
10,935,488 90,416,322
Redeemed (10,821,019) (92,017,645) (12,195,290) (104,683,139)
- ------ ------ ------ ------
Net increase 14,461,980 $123,942,753 39,277,997 $335,283,270
- ------ ------ ------ ------
- ------ ------ ------ ------
- ------
Class B:
Sold 23,249,462 $197,323,572 24,707,937 $219,055,169
Dividends and distributions reinvested 350,928 2,866,623 1,561,693
13,222,296
Redeemed (2,378,628) (19,944,337) (1,009,115) (8,980,550)
- ------ ------ ------ ------
Net increase 21,221,762 $180,245,858 25,260,515 $223,296,915
- ------ ------ ------ ------
- ------ ------ ------ ------
- ------
Class Y:
Sold 1,215 $10,000
Dividends and distributions reinvested 8 61
Redeemed -- --
- ------ ------
Net increase 1,223 $10,061
- ------ ------
- ------ ------
1. For the six months ended June 30, 1994 for Class A and Class B shares and for
the period June 1, 1994 (inception of offering) to June 30, 1994 for Class Y
shares.
2. For the year ended December 31, 1993 for Class A shares and for the period
from May 1, 1993 (inception of offering) to December 31, 1993 for Class B
shares.
- ------
3. Unrealized Gains and
Losses on Investments
At June 30, 1994, net unrealized appreciation on investments of $45,016,685 was
composed of gross appreciation of $140,476,220, and gross depreciation of
$95,459,535.
- ------
4. Call Option Activity Call option activity for the six months ended June
30, 1994 was as follows:
Number of Amount of
Options Premiums
- ------
Options outstanding at December 31, 1993 -- $--
- ------
Options written 3,400 792,731
- ------
Options cancelled in closing purchase transactions (900) (205,463)
- ------ ------
Options outstanding at June 30, 1994 2,500 $587,268
- ------ ------
- ------ ------
17 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Notes to Financial Statements (Unaudited) (Continued)
- ------
5. Management Fees and
Other Transactions
With Affiliates
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for an annual fee of .75% on the
first $100 million of net assets with a reduction of .05% on each $100 million
thereafter, to .50% on net assets in excess of $500 million. The Manager has
agreed to reimburse the Fund if aggregate expenses (with specified exceptions)
exceed the most stringent applicable regulatory limit on Fund expenses.
For the six months ended June 30, 1994, commissions (sales charges paid by
investors) on sales of Class A shares totaled $5,924,631, of which $1,822,592
was retained by Oppenheimer Funds Distributor, Inc. (OFDI), a subsidiary of the
Manager, as general distributor, and by an affiliated broker/dealer. During the
six months ended June 30, 1994, OFDI received contingent deferred sales charges
of $238,084 upon redemption of Class B shares.
Oppenheimer Shareholder Services (OSS), a division of the Manager, is the
transfer and shareholder servicing agent for the Fund, and for other registered
investment companies. OSS's total costs of providing such services are allocated
ratably to these companies.
Under separate approved plans, Class A and Class B may expend up to .25% of
its net assets annually to reimburse OFDI for costs incurred in connection with
the personal service and maintenance of accounts that hold shares of the Fund
(prior to July 1, 1994, reimbursements were made with respect to shares sold
subsequent to March 31, 1988 for Class A), including amounts paid to brokers,
dealers, banks and other financial institutions. In addition, Class B shares are
subject to an asset-based sales charge of .75% of net assets annually, to
reimburse OFDI for sales commissions paid from its own resources at the time of
sale and associated financing costs. In the event of termination or
discontinuance of the Class B plan, the Board of Trustees may allow the Fund to
continue payment of the asset-based sales charge to OFDI for distribution
expenses incurred on Class B shares sold prior to termination or discontinuance
on the plan. During the six months ended June 30, 1994, OFDI paid $68,584 to an
affiliated broker/dealer as reimbursement for Class A personal service and
maintenance expenses and retained $1,506,830 as reimbursement for Class B sales
commissions and service fee advances, as well as financing costs.
- ------
6. Restricted Securities
The Fund owns securities purchased in private placement transactions, without
registration under the Securities Act of 1933 (the Act). The securities are
valued under methods approved by the Board of Directors as reflecting fair
value. The Fund intends to invest no more than 10% of its net assets (determined
at the time of purchase) in restricted and illiquid securities, excluding
securities eligible for resale pursuant to Rule 144A of the Act that are
determined to be liquid by the Board of Directors or by the Manager under
Board-approved guidelines. Restricted and illiquid securities amount to
$84,206,940, or 5.33% of the Fund's net assets, at June 30, 1994.
Valuation Per Unit
Security Acquisition Date Cost Per Unit as of June 30, 1994
- ------
AMR Corp., $3.00 Cum Cv. Depositary Shares, Series A 6/25/93--6/30/94
$ 47.84 $44.25
- ------
Banco Nacional de Comercio Exterior SNC International
Finance BV, 8% Gtd. Matador Bonds, 8/5/03 11/12/93 $ 97.88 $85.00
- ------
Banco Nacional de Mexico SA, 7%, Exch. Sub. Debs., 12/15/99 12/1/92--3/2/93
$ 99.33 $107.00
- ------
Catellus Development Corp., $3.625 Cv., Series B (1) 10/28/93--6/17/94
$ 47.92 $42.00
- ------
Chemical Banking Corp., $5.00 Cv. 6/25/92--4/6/94 $ 76.26 $76.00
- ------
Chiron Corp., 1.90% Cv. Sub. Nts., 11/17/00 11/9/93--6/9/94 $ 82.11
$68.00
- ------
Compania Inversiones Tel, Cv. $62.00(1) 3/3/94--6/28/94 $ 62.54
$59.50
- ------
Food Lion, Inc., 5.00% Sub. Debs., 6/1/03 3/21/94--6/3/94 $ 97.75
$96.00
- ------
Gensia, Inc.(1) 5/11/93--5/14/93 $ 46.52 $25.00
- ------
Integrated Health Services, Inc., 5.75% Cv. Sub. Debs., 1/1/01 12/17/93
$100.00 $106.50
- ------
Lynx Therapeutics, Inc.(1) 10/19/92 $ .20 $.20
- ------
Lynx Therapeutics, Inc., Series A(1) 10/19/92 $ 1.00 $1.00
- ------
Pharmaceutical Marketing Services, Inc., 6.25% Cv. Sub. Debs., 2/1/03
1/27/93 $100.00 $70.50
- ------
Physicians Clinical Laboratory, Inc., 7.5% Cv. Sub. Debs., 8/15/00 8/17/93
$100.00 $100.37
- ------
Shangri-La Asia Ltd., 2.875% Cv. Sub. Debs., 6/6/00 12/9/93 $ 86.24
$82.50
- ------
Transco Energy Co., $3.00 Cum. Cv., Series E(1) 1/27/93--1/20/94
$ 49.38 $48.25
1. Transferable under Rule 144A of the Act.
18 Oppenheimer Total Return Fund, Inc.
<PAGE>
- ------
Oppenheimer Total Return Fund, Inc.
- ------
Officers and Directors James C. Swain, Chairman and Chief Executive Officer
Robert G. Avis, Director
William A. Baker, Director
Charles Conrad, Jr., Director
Jon S. Fossel, Director and President
Raymond J. Kalinowski, Director
C. Howard Kast, Director
Robert M. Kirchner, Director
Ned M. Steel, Director
Andrew J. Donohue, Vice President
John L. Wallace, Vice President
George C. Bowen, Vice President, Secretary and Treasurer
Robert J. Bishop, Assistant Treasurer
Scott Farrar Assistant Treasurer
Robert G. Zack, Assistant Secretary
- ------
Investment Advisor Oppenheimer Management Corporation
- ------
Distributor Oppenheimer Funds Distributor, Inc.
- ------
Transfer and Shareholder
Servicing Agent
Oppenheimer Shareholder Services
- ------
Custodian of
Portfolio Securities
The Bank of New York
- ------
Independent Auditors Deloitte & Touche
- ------
Legal Counsel Myer, Swanson & Adams, P.C.
The financial statements included herein have been taken from the records of the
Fund without examination by the independent auditors.
This is a copy of a report to shareholders of Oppenheimer Total Return Fund,
Inc. This report must be preceded or accompanied by a Prospectus of Oppenheimer
Total Return Fund, Inc. For material information concerning the Fund, see the
Prospectus.
19 Oppenheimer Total Return Fund, Inc.
<PAGE>
- -------------------------------------------------------------------------------
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"When you invest in OppenheimerFunds, you know you'll receive a high
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"Whatever your needs, we're ready to assist you."
[Logo]
1993
AWARD OF EXCELLENCE
ICSA
International Customer Service Association
[Photo]
BARBARA HENNIGAR
CHIEF EXECUTIVE OFFICER
OPPENHEIMER SHAREHOLDER SERVICES
[Logo] OPPENHEIMERFUND
Oppenheimer Funds Distributor, Inc.
P.O. Box 5270
Denver, CO 80217-5270
Bulk Rate
U.S. Postage
PAID
Permit No. 377
Hackensack, NJ
