<PAGE>
Dreyfus
Core Value
Fund
Annual Report
December 31, 1997
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Letter to Shareholders
Dear Shareholder:
We are pleased to provide you with this annual report for the Dreyfus Core
Value Fund. Effective January 16, 1998, the Fund's name will change from Dreyfus
Core Value Fund to Dreyfus Premier Core Value Fund. The Fund's performance for
the 12-month period ended December 31, 1997 is shown in the following table:
Total Return*
-------------
Investor Shares 25.21%
Institutional Shares 25.34%
Restricted Shares 25.54%
Standard & Poor's 500 Composite Stock Price
Index ("S&P 500")** 33.35%
By past standards, the Fund provided a robust total return. However,
weakness in the fourth quarter caused the Fund to lag behind the exceptional
1997 returns of the Fund's benchmark, the S&P 500.
ECONOMIC REVIEW
In 1997, the U.S. economy put in its best growth performance of this business
cycle to date. In tandem, the labor market tightened markedly, marginally
boosting wage inflation towards year end. Yet price inflation decelerated and
bond yields fell. Although corporate profit growth was robust for much of the
year, strains began to appear in the second half in some sectors. The Federal
Reserve Board (the "Fed") tightened credit early in the year, then subsequently
stayed on hold, torn between strong economic reports at home and worsening
financial crises overseas.
Real Gross Domestic Product (GDP) grew 3.8% in 1997, its best annual growth
since 1988. Almost all the major sectors contributed to growth. Households
enjoyed rising real incomes as wage increases outpaced price inflation. Moderate
interest rates buoyed housing demand. Tightening factory capacity boosted
capital spending, and until late in the year, steady foreign growth kept exports
robust. That all these sectors grew simultaneously in a late phase of the
business cycle was unusual. The year 1997 also saw a dramatic narrowing of the
Federal budget deficit. It is likely that the associated drop in Federal
borrowing boosted the supply of credit available to the private sector.
As mentioned, overall corporate profit growth rebounded in 1997, after
slowing in 1996. Profits from domestic sources generally did well. However,
profits from international sources began to show strains in the second half,
impacted by the rising dollar and by financial stresses overseas. More recently,
profits at some companies have been slowed by price weakness.
Economic data this winter showed that the economy was still quite strong
although some leading statistics have begun to signal somewhat slower economic
growth for 1998. First, recently slowing export orders and rising import orders
imply a widening trade deficit. Second, the number of announced layoffs has
begun to rise, indicating some future easing of labor market pressures. Should
these leading statistics actually show up in a slowing of the economy, market
expectations may shift to anticipate the possibility of a move by the Fed to
ease credit. At the start of 1998, there was uncertainty about both the severity
of Asian stresses and their impact on the U.S. economy.
MARKET OVERVIEW
By virtually every measurement, 1997 was a favorable year for stocks. The
12-month gains, despite setbacks along the way, were impressive. However, the
year ended on a note of uncertainty with no assurance that the gains of 1997
could be repeated in 1998.
Index figures (price changes only, without including income) help tell the
story: For the 12 months ended December 31, 1997, the Dow Jones Industrial
Average (DJIA) rose by 22.64%, the broader S&P 500 was up 31.01%, the Nasdaq
Composite was up 21.64% and the Russell 2000, representing small capitalization
stocks, gained 20.52%.
<PAGE>
The economic background, at least until October, when Asia's troubles
surfaced, was clearly favorable. So much so that economic commentators talked of
the "Goldilocks economy" -- not too hot and not too cold. Unemployment was low,
industrial production and other output measures continued to grow, yet price and
wage inflation were not problems. By the end of the year, there was even talk
that the next economic problem might be a touch of deflation.
The market began the year by rebounding from earlier weakness. The signs in
the market and the economy were so bullish that Fed Chairman Alan Greenspan
warned against "irrational exuberance" in December 1996, then followed that up
on March 25, 1997 with an increase in short-term interest rates. That cooled off
the stock market temporarily, but not for long. By early August, major stock
market averages reached all-time record highs.
As summer turned into autumn, however, doubts began to appear. There were
worries about the profit outlook and that inflation might resume. The biggest
negative influences, however, were the financial setbacks in Asia, starting with
Thailand, Malaysia, the Philippines, Hong Kong and Indonesia, then spreading to
South Korea and Japan. This raised questions for American investors about how
our export orders might be affected, how the profits of U.S. multinationals
would fare, and whether devaluation of Asian currencies would cause a flood of
cheaper imported goods into the U.S.
In view of these unsettling questions, it was impressive that the damage to
U.S. stocks by year-end was comparatively limited. On October 27, the DJIA sank
to 7161.15, a one-day loss of 7.18%, the worst since the big market sinking
spell of ten years earlier. Yet by the end of the year, the Dow had bounced back
to 7908.25, with other major indexes and averages following suit.
For much of the year, large capitalization companies were in favor, though
small caps staged an impressive rally in midyear. Among the best-performing
industry groups were banks and other financial stocks, broadcasting,
advertising, airlines, home construction and trucking. Consumer software,
precious metals (particularly gold) and heavy industrial materials were among
the laggards.
Mergers and acquisitions were the driving force for some key stocks,
particularly in the communications, finance and broadcasting industries. The
merger pace was such that it seemed likely to carry over into 1998.
The boom of 1997 gave rise to such terms as "new era" and "new paradigm" to
describe the phenomenon of a stock market making new highs for three years
in a row. Yet the clouds that appeared on the horizon late in the year
place the burden of proof for 1998 on the "new era" advocates.
PORTFOLIO FOCUS
Two areas of weakness for the Fund during the fourth quarter were foreign
stocks and health maintenance organizations (HMOs).
The turmoil in Asian markets affected a large sector of the Fund during the
fourth quarter; namely, foreign stocks, which comprised 16.44% of the Fund's
assets as of December 31, 1997. The sell-off in foreign stocks was
indiscriminate and in many instances excessive. We believe several of our
foreign stock holdings will come through the Asian crisis relatively unscathed
for the long term.
Underperformance of the Fund's HMO holdings, including Aetna and Wellpoint
Health Networks, reflected the impact of disappointing earnings reports from
many companies in the industry. Medical costs for many HMOs trended above
management's expectations during the second half of 1997, resulting in earnings
shortfalls at many HMOs.
A third factor impacting fourth-quarter performance was the Fund's move away
from relatively expensive large-capitalization stocks toward less expensive
medium-capitalization stocks that did not hold up as well in the weak
fourth-quarter market.
<PAGE>
For the full year of 1997, the Fund's overweighted positions in financial and
consumer services, compared to the S&P 500 were strong positive factors in total
performance. Finance stocks, in fact, accounted for 60% of the best ten stocks
in the portfolio. The Equitable Cos., Ahmanson (HF) & Co., BankAmerica and
Morgan Stanley Dean Witter were among the Fund's top-performing stocks for the
year.
An underweighted position in technology stocks, relative to the S&P 500,
detracted from the year's results. Many of the stocks in this sector are
relatively expensive and therefore are not appropriate investments for this
value-oriented Fund.
We appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ VALERIE J. SILL
Valerie J. Sill
Portfolio Manager
January 12, 1998
New York, N.Y.
* Effective January 16, 1998, the Fund's Investor shares will be redesignated
as Class A shares and Class A shares will begin being sold with a front-end
sales load (other than to holders of the Fund's Investor shares as of
January 15, 1998, who will be able to continue to purchase Class A shares
of the Fund for their Fund account without a front-end sales load). Also
effective January 16, 1998, the Fund's Restricted shares will be
redesignated as Class R shares. Total return includes reinvestment of
dividends and any capital gains paid, and does not take into consideration
the maximum initial sales charge that will become applicable to Class A
shares.
** SOURCE: LIPPER ANALYTICAL SERVICES, INC.--Reflects the reinvestment of
income dividends and, where applicable, capital gain distributions. The
Standard & Poor's 500 Composite Stock Price Index is a widely accepted
unmanaged index of U.S. stock market performance.
<PAGE>
Dreyfus Core Value Fund December 31, 1997
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN DREYFUS CORE VALUE FUND
INVESTOR SHARES AND THE STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
Dollars
$52,448
Standard & Poor's
500 Composite Stock
Price Index*
$39,831
Dreyfus
Core Value Fund (Investor Shares)
*Source: Lipper Analytical Services, Inc.
Average Annual Total Returns
- --------------------------------------------------------------------------------
Investor Shares Institutional Shares
- ---------------------------------- ----------------------------------
Period Ended 12/31/97 Period Ended 12/31/97
- --------------------- ---------------------
1 Year 25.21% 1 Year 25.34%
5 Years 19.23 From Inception (2/1/93) 19.26
10 Years 14.82
Restricted Shares
----------------------------------
Period Ended 12/31/97
---------------------
1 Year 25.54%
From Inception (8/4/94) 23.10
- ------------
Past performance is not predictive of future performance.
Effective January 16, 1998, the Fund's name will change from Dreyfus Core Value
Fund to Dreyfus Premier Core Value Fund. Also, effective January 16, 1998,
the Fund's Investor shares will be redesignated as Class A shares and Class A
shares will be sold with a front-end sales load (other than to holders of the
Fund's Investor shares as of January 15, 1998, who will be able to continue to
purchase Class A shares of the Fund for their Fund account without a front-end
sales load). In addition, the Fund's Restricted shares will be redesignated
as Class R shares.
The above graph compares a $10,000 investment made in Investor shares of
Dreyfus Core Value Fund on 12/31/87 to a $10,000 investment made in the
Standard & Poor's 500 Composite Stock Price Index on that date. All
dividends and capital gain distributions are reinvested. Performance for
Restricted shares and Institutional shares will vary from the performance of
Investor shares shown above due to differences in charges and expenses.
The Fund's performance shown in the line graph takes into account all
applicable fees and expenses as of 12/31/97. The Fund's performance in the line
graph and average annual total returns do not take into consideration the
maximum initial sales charge that will become applicable to Class A shares on
January 16, 1998 which if reflected, would reduce performance. The Standard &
Poor's 500 Composite Stock Price Index is a widely accepted, unmanaged index of
overall stock market performance, which does not take into account charges,
fees and other expenses. Further information relating to Fund performance,
including expense reimbursements, if applicable, is contained in the Financial
Highlights section of the Prospectus and elsewhere in this report.
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments December 31, 1997
Common Stocks--98.5% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Aerospace &
Military Technology--.0% C.S.F. (Thompson)............................. 6,805 $ 214,490
------------
Appliances--2.1% Philips Electronics........................... 214,500 12,977,250
Rinnai........................................ 9,000 135,789
Solid Group................................... 400,000 15,802
Sony.......................................... 6,500 577,468
Vestel Elektronik Sanayi ve Ticaret........... 50,000 4,101
------------
13,710,410
------------
Automobiles--.2% Fiat.......................................... 58,300 169,100
Honda Motor................................... 11,000 403,538
Tata Engineering & Locomotive, GDR............ 3,400(b) 28,322
Toyota Motor.................................. 13,000 372,367
Volkswagen.................................... 350 196,887
------------
1,170,214
------------
Banking--3.4% ABN-Amro...................................... 16,690 325,125
Australia & New Zealand Banking............... 56,238 371,691
Banco BHIF, ADS............................... 2,500 40,000
Banco Rio de la Plata, ADR.................... 3,400(a) 47,600
Banco Totta E Acores.......................... 14,700 288,649
BankAmerica................................... 186,360 13,604,280
Bank Austria.................................. 8,000 215,326
Bank Handlowy W Warszawie, GDR................ 3,100(a) 41,075
Bank Leumi Le-Israel.......................... 34,000 57,048
Barnett Banks................................. 55,000 3,953,126
Corporacion Bancaria de Espana, ADS........... 17,000 519,563
Deutsche Bank................................. 6,500 458,866
Development Bank of Singapore................. 33,000 281,934
Dexia France.................................. 3,000 347,429
Guoco Group................................... 64,000 156,510
HSBC.......................................... 8,461 208,550
Istituto Mobiliare Italiano, ADS.............. 6,100 218,075
KREDYT BANK, GDR.............................. 1,400(a,b) 17,570
Komercni Banka, GDR........................... 1,000 12,000
Kookmin Bank, ADS............................. 7,159(b) 33,969
MISR INTERNATIONAL BANK, GDR.................. 3,000(a,b) 44,040
National Westminster Bank..................... 32,687 543,327
Societe Generale.............................. 2,824 384,760
State Bank of India, GDR...................... 2,800(b) 50,960
UBS........................................... 320 462,523
United Overseas Bank.......................... 4,000 22,189
------------
22,706,185
------------
Basic Industries--5.7% Bethlehem Steel............................... 327,600 2,825,550
Crown Cork & Seal............................. 194,350 9,741,795
IMC Global.................................... 174,900 5,727,975
</TABLE>
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1997
Common Stocks--98.5% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Basic Industries (continued) Louisiana Pacific............................. 188,000 $ 3,572,000
Reynolds Metals............................... 95,500 5,730,000
Union Carbide................................. 74,000 3,177,375
Waste Management.............................. 265,000 7,287,500
------------
38,062,195
------------
Beverages & Tobacco--1.7% Mikuni Coca Cola Bottling..................... 22,000 274,642
Philip Morris Cos............................. 234,100 10,607,656
Quilmes Industrial, ADR....................... 5,000 68,438
Sistema Argos, Ser. B......................... 36,000 64,680
------------
11,015,416
------------
Broadcasting & Publishing--.7% Marieberg Tidnings............................ 10,000 234,260
Mondadori (Arnoldo) Editore................... 12,500 98,212
Reuters Holdings, ADS......................... 60,000 3,975,000
Societe Television Francaise.................. 2,300 235,025
------------
4,542,497
------------
Building Materials--.1% Apasco........................................ 8,000 55,511
Barlow........................................ 3,023 25,655
Barlow, ADR................................... 4,446 36,824
Boral......................................... 135,970 343,866
Forbo Holding................................. 380 155,255
Sekisui Chemical.............................. 38,000 192,954
------------
810,065
------------
Capital Goods--4.2% Case.......................................... 103,100 6,231,107
Litton Industries............................. 88,500(a) 5,088,750
Lockheed Martin............................... 60,000 5,910,000
Northrop Grumman.............................. 34,600 3,979,000
Raytheon, Cl. A............................... 121 6,014
Raytheon, Cl. B............................... 1,500 75,750
United Technologies........................... 89,000 6,480,313
------------
27,770,934
------------
Chemicals--1.7% AKZO Nobel, ADR............................... 38,700 3,362,063
Bayer......................................... 11,600 433,307
Imperial Chemical Industries, ADR............. 112,500 7,305,469
PT Indorama Synthetics........................ 42,000 18,709
Paints & Chemical Industry, GDR............... 4,000(b) 41,720
Polifin....................................... 15,000 21,576
Reliance Industries, GDR...................... 8,000(b) 68,800
Sasol......................................... 2,000 20,959
------------
11,272,603
------------
</TABLE>
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1997
Common Stocks--98.5% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Construction & Housing--.1% AEGEK ........................................ 2,500 $ 11,749
Chudenko...................................... 95 2,074
Hellenic Technodomiki......................... 3,300 28,346
Hollandsche Beton Groep....................... 15,420 286,696
Michaniki..................................... 2,000 10,244
Mota e Companhia.............................. 2,600 41,249
Nishimatsu Construction....................... 40,000 125,603
Sekisui House................................. 30,000 192,770
Tarkett....................................... 10,000 230,683
------------
929,414
------------
Consumer Durables--3.5% General Motors................................ 131,900 7,996,439
Lear.......................................... 132,400 6,289,000
Whirpool...................................... 170,800 9,394,000
------------
23,679,439
------------
Consumer Non-durables--6.9% Fruit of the Loom, Cl. A...................... 1,800(a) 46,125
Harcourt General.............................. 203,200 11,125,201
Hasbro........................................ 120,900 3,808,350
Loews......................................... 83,000 8,808,375
Polaroid...................................... 85,300 4,153,044
RJR Nabisco Holdings.......................... 420,300 15,761,250
Reebok International.......................... 69,100(a) 1,990,944
------------
45,693,289
------------
Consumer Services--6.3% ACNielsen..................................... 255,700(a) 6,232,688
ARA........................................... 15,000(a) 72,858
American Stores............................... 153,000 3,146,062
Browning-Ferris Industries.................... 111,500 4,125,500
Circuit City Stores-Circuit City Group........ 98,000 3,485,125
Deluxe........................................ 144,300 4,978,350
Federated Department Stores................... 171,400(a) 7,380,914
Toys R Us..................................... 209,900(a) 6,598,731
Viacom, Cl. B................................. 143,400(a) 5,942,138
------------
41,962,366
------------
Data Processing--.1% Canon......................................... 20,000 465,651
------------
Electrical & Electronics--2.4% Alcatel Alsthom, ADS.......................... 458,816 11,613,780
Hitachi....................................... 47,000 334,763
Mabuchi Motor................................. 7,000 355,441
Siemens....................................... 10,000 591,996
Teradyne...................................... 95,000(a) 3,040,000
Toshiba....................................... 75,000 311,902
------------
16,247,882
------------
</TABLE>
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1997
Common Stocks--98.5% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Electronics & Instruments--.8% Lam Research.................................. 163,000(a) $ 4,767,750
Murata Manufacturing.......................... 15,400 386,858
QPL International Holdings.................... 75,000 33,391
Rohm.......................................... 4,000 407,444
Samsung Electronics........................... 304 6,887
Samsung Electronics, GDR...................... 508(a,b) 7,109
------------
5,609,439
------------
Energy--9.1% British Petroleum, ADS........................ 36,200 2,884,688
Burlington Resources.......................... 62,000 2,778,375
Duke Energy................................... 80,000 4,430,000
ENI, ADS...................................... 6,300 359,494
Elf Aquitaine................................. 1,193 138,755
Elf Aquitaine, ADS............................ 146,258 8,574,375
Engen......................................... 12,500 63,572
Exxon......................................... 49,100 3,004,306
Ingwe Coal.................................... 19,500 67,718
MOL Magyar Olaj-es Gazipari, GDR.............. 3,400(b) 82,960
Mobil......................................... 166,700 12,033,657
Petronas Dagangan............................. 30,000 25,453
Phillips Petroleum............................ 129,100 6,277,488
Repsol........................................ 6,000 255,989
Repsol, ADR................................... 7,000 297,938
Tosco......................................... 267,600 10,118,626
Unocal........................................ 226,000 8,771,626
YPF Sociedad Anonima, ADS..................... 11,800 403,413
------------
60,568,433
------------
Energy Equipment & Services--.0% Endesa........................................ 12,800 227,266
------------
Financial Services--18.6% Aetna......................................... 164,100 11,579,307
Ahmanson (H F) & Co........................... 161,200 10,790,326
Allmerica Financial........................... 90,900 4,539,319
Allstate...................................... 71,600 6,506,650
CoreStates Financial.......................... 41,400 3,314,588
Credit Saison................................. 21,850 538,845
Dun & Bradstreet.............................. 219,800 6,800,063
Equitable Cos................................. 172,300 8,571,925
Everest Reinsurance Holdings.................. 171,400 7,070,250
First Union................................... 57,600 2,952,000
General Re.................................... 31,800 6,741,600
Grupo Financiero Inbursa, Ser. B.............. 20,000 81,779
Hartford Financial Services Group............. 34,100 3,190,481
Morgan Stanley Dean Witter.................... 186,900 11,050,464
NationsBank................................... 120,700 7,340,069
Nichiei....................................... 4,300 457,762
Republic New York............................. 39,000 4,453,312
</TABLE>
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1997
Common Stocks--98.5% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Financial Services (continued) SAFECO........................................ 149,100 $ 7,268,625
SLM Holding................................... 83,300 11,589,114
Washington Mutual............................. 145,680 9,296,205
------------
124,132,684
------------
Foods & Related Products--2.9% Archer-Daniels-Midland........................ 336,975 7,308,145
Danone........................................ 2,288 408,673
Daya Guna Samudera............................ 16,000 12,145
Kao........................................... 39,000 561,538
McDonald's.................................... 123,000 5,887,881
Nestle........................................ 330 494,368
Pick Szeged, ADR.............................. 700 11,200
Pick Szeged, GDR.............................. 700(b) 43,750
Tablex........................................ 10,029 22,989
Tricon Global Restaurants..................... 149,000 4,330,313
Universal Robina.............................. 215,000 26,277
------------
19,107,279
------------
Forest & Paper Products--.1% Aracruz Celulose, ADS......................... 3,700 53,188
Jaya Tiasa Holdings........................... 16,000 29,412
Koninklijke KNP............................... 15,000 345,465
PT Indah Kiat Pulp & Paper.................... 156,000 27,654
------------
455,719
------------
Health Care--6.8% American Home Products........................ 77,500 5,928,750
Amgen ........................................ 61,800 3,344,925
Bard (C.R.)................................... 101,900 3,190,744
Columbia/HCA Healthcare....................... 279,200 8,271,300
Foundation Health Systems, Cl. A.............. 176,800(a) 3,955,900
Hoechst....................................... 3,400 119,066
Johnson & Johnson............................. 109,600 7,219,900
Medeva........................................ 73,000 194,242
Pharmacia & Upjohn............................ 12,300 450,488
Rhone-Poulenc, ADR............................ 7,091 314,663
Tenet Healthcare.............................. 223,000(a) 7,386,875
Wellpoint Health Networks..................... 111,200(a) 4,698,200
Yamanouchi Pharmaceutical..................... 17,000 364,555
------------
45,439,608
------------
Industrial Components--1.2% Leader Universal Holdings.................... 25,000 7,713
LucasVarity................................... 130,000 459,079
LucasVarity, ADS.............................. 184,800 6,444,900
Michelin...................................... 5,249 264,260
Minebea....................................... 48,000 514,666
Mirgor S.A.C.I.F.I.A., ADR.................... 7,000(a,b) 24,500
------------
7,715,118
------------
</TABLE>
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1997
Common Stocks--98.5% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Insurance--2.0% Axa-UAP....................................... 3,500 $ 270,823
CIGNA ..................................69,200 11,975,925
Dai-Tokyo Fire & Marine Insurance............. 75,000 257,333
Pacific & Orient.............................. 18,000 8,238
Royal & Sun Alliance Insurance................ 57,587 579,816
------------
13,092,135
------------
Leisure & Tourism--.1% ITT........................................... 800(a) 66,300
NAMCO ........................................ 8,000 232,212
Stakis........................................ 150,000 234,056
------------
532,568
------------
Machinery--.3% Fuji Machine Manufacturing.................... 10,000 241,250
GEA........................................... 1,000 377,988
Laird Group................................... 45,000 328,911
Mitsubishi Heavy Industries................... 68,000 283,312
Scania AB..................................... 5,000 111,777
Scania AB `A', ADS............................ 2,250 50,625
Scania AB `B', ADS............................ 2,250 50,625
Sulzer........................................ 320 202,792
Uzel Makina Sanayii, ADR...................... 500(a,b) 20,500
------------
1,667,780
------------
Merchandising--.7% Blue Square Chain Investments & Properties.... 8,500(a) 81,153
Companhia Brasileira de Distribuicao Grupo
Pao de Acucar, GDR......................... 1,800 34,875
Controladora Comercial Mexicana, GDS.......... 2,400 62,250
Ito-Yokado.................................... 10,000 509,305
Matsumotokiyoshi.............................. 5,000 191,468
Safeway....................................... 81,763 460,634
Santa Isabel, ADS............................. 3,300 57,750
Super-Sol..................................... 3,600 50,625
Woolworth..................................... 172,500(a) 3,514,688
------------
4,962,748
------------
Metals--1.1% British Steel, ADS............................ 157,900 3,384,981
China Steel, ADR.............................. 67(a,b) 1,013
Companhia Vale do Rio Doce, ADS............... 4,300 88,687
Inco.......................................... 177,400 3,015,800
Jiangxi Copper................................ 100,000(a) 11,098
KGHM Polska Miedz, GDR........................ 2,200(a,b) 15,906
Pechiney A.................................... 4,500 177,652
Pohang Iron & Steel........................... 1,550 43,652
Rio Tinto..................................... 36,381 447,571
Steel Authority of India, GDR................. 5,000(b) 16,650
Tubes de Acero de Mexico, ADR................. 2,300(a) 49,738
Usinor........................................ 15,500 223,802
------------
7,476,550
------------
</TABLE>
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1997
Common Stocks--98.5% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Miscellaneous Materials--.1% Bunzl......................................... 101,871 $ 395,719
Corticeira Amorin............................. 4,000 47,813
Cristalerias de Chile, ADS.................... 2,500 36,250
Empaques Ponderosa, Ser. B.................... 47,000(a) 40,533
Kwantas....................................... 12,000 8,638
------------
528,953
------------
Multi Industry--.3% ALFA, Ser. A.................................. 1,758 11,893
Anglo American Gold........................... 900 36,358
BTR........................................... 137,685 416,112
Desc, Ser. B.................................. 5,000 47,705
Desc, Ser. C.................................. 80 753
First Philippine Holdings..................... 37,000 28,778
Foodcorp...................................... 5,000 25,685
Fotex......................................... 20,000(a) 22,521
Hunter Douglas................................ 7,886 276,129
Koor Industries............................... 600 66,436
Montedison.................................... 210,000 188,276
Orkla AS-B.................................... 2,100 163,205
Quinenco, ADR................................. 6,700(a) 77,050
Swire Pacific................................. 145,000 146,890
Tomkins....................................... 135,133 645,892
------------
2,153,683
------------
Recreation--.0% China Hong Kong Photo Products Holdings....... 59,000 14,771
Sankyo........................................ 10,000 146,282
------------
161,053
------------
Technology--4.4% Applied Materials............................. 106,700(a) 3,214,338
International Business Machines............... 84,600 8,845,988
Scientific-Atlanta............................ 216,000 3,618,000
Silicon Graphics.............................. 315,400(a) 3,922,787
Storage Technology............................ 100,000(a) 6,193,750
Sun Microsystems.............................. 95,500(a) 3,808,062
------------
29,602,925
------------
Telecommunications--.4% Cable & Wireless, ADS......................... 9,000 244,688
Commscope..................................... 9(a) 121
Compania de Telecom Chile, ADS................ 3,400 101,575
Hellenic Tellecommunication Organization...... 23,500(a,b) 246,750
Magyar Tavkozlesi............................. 800 20,800
Mahanagar Telephone Nigam, GDR................ 4,000(a,b) 61,800
PT Indosat.................................... 1,500 28,968
Philippine Long Distance Telephone, ADS....... 2,900 65,250
Royal PTT Nederland, ADS...................... 7,053 292,700
SK Telecom.................................... 200 59,858
</TABLE>
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1997
Common Stocks--98.5% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Telecommunications (continued) Tele Danmark, ADS............................. 9,800 $ 301,963
Telecom Italia................................ 125,000 549,251
Telecomunicacoes Brasileiras, ADS............. 1,600 186,300
Telefonica de Argentina....................... 20,400 76,515
Telefonica del Peru, ADS...................... 12,500 291,406
Telefonos de Mexico, Cl. L, ADR............... 500 28,031
Telekom Malaysia.............................. 12,000 35,480
Videsh Sanchar Nigam, GDR..................... 4,000(b) 56,100
------------
2,647,556
------------
Transportation--2.9% Air New Zealand............................... 59,818 119,840
Burlington Norhtern Santa Fe.................. 66,400 6,171,050
Canadian Pacific.............................. 217,000 5,913,250
China Southern Airlines, ADR.................. 1,500(a) 19,781
Cintra........................................ 55,000(a) 50,908
Deutsche Lufthansa............................ 14,300 274,236
Linea Aerea Nacional de Chile, ADS............ 3,000(a) 40,875
Singapore Airlines............................ 16,000 104,420
Union Pacific................................. 105,000 6,555,938
Yamato Transport.............................. 26,500 355,173
------------
19,605,471
------------
Utilities--7.6% Bell Atlantic................................. 96,292 8,762,572
Berliner Kraft-und Licht Aktiengesellschaft... 4,000 120,956
CMS Energy.................................... 131,400 5,789,813
Central Costanera, Cl. B...................... 9,000 23,404
Czeske energeticke zavody..................... 1,100 36,098
Electricidade de Portugal, ADR................ 1,400(a) 54,250
GTE........................................... 147,000 7,680,750
Gas Y Electridad.............................. 6,000 433,213
Hongkong Electric Holdings.................... 97,000 368,647
Illinova...................................... 170,100 4,582,069
MCI Communications............................ 130,750 5,597,734
New England Electric System................... 96,000 4,104,000
Pinnacle West Capital......................... 135,900 5,758,762
PowerGen...................................... 41,596 541,106
Southern...................................... 229,000 5,925,375
Tenaga Nasional............................... 26,000 55,483
VEBA.......................................... 7,700 524,319
Viag.......................................... 640 344,725
------------
50,703,276
------------
TOTAL COMMON STOCKS
(cost $573,255,029)........................ $656,643,294
============
</TABLE>
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Investments (continued) December 31, 1997
Preferred Stocks--1.0% Shares Value
- ------------------------------------------------------------------------------- -------------- -------------
<S> <C> <C> <C>
Appliances--.0% Brasmotor..................................... 300 $ 29,567
------------
Banking--.0% Bank Austria.................................. 5,040 227,422
------------
Broadcasting & Publishing--1.0% Lusomundo Sociedade Gestora de
Participacoes Sociais...................... 1,885 17,411
News.......................................... 320,000 6,360,000
------------
6,377,411
------------
Building Materials--.0% Companhia Cemento Portland Itau............... 200 38,527
------------
Energy--.0% Petroleo Brasileiro........................... 300 70,155
------------
Merchandising--.0% Hugo Boss..................................... 125 161,548
------------
Telecommunications--.0% Ericsson Telecomunicacoes..................... 1,000 32,076
------------
Utilities--.0% Companhia Energetica Minas de Energia-Copel... 800 34,757
Companhia Paranaense de Energia-Copel......... 2,000 27,148
------------
61,905
------------
TOTAL PREFERRED STOCKS
(cost $5,282,468).......................... $ 6,998,611
============
Principal
Short-Term Investments--.1% Amount
- ------------------------------------------------------------------------------- --------------
Commercial Paper; General Electric Corporation,
6.65%, 1/2/98
(cost $873,000)............................ $873,000 $ 873,000
============
TOTAL INVESTMENTS (cost $579,410,497).......................................... 99.6% $664,514,905
====== ============
CASH AND RECEIVABLES (NET)..................................................... .4% $ 2,402,754
====== ============
NET ASSETS..................................................................... 100.0% $666,917,659
====== ============
<FN>
Notes to Statement of Investments:
- --------------------------------------------------------------------------------
(a) Non-income producing.
(b) Securities exempt from registration under Rule 144A of the Securities Act of
1933. These securities maybe resold in transactions exempt from
registration, normally to qualified institutional buyers. At December 31,
1997, these securities amounted to $862,419 or approximately 0.1% of net
assets.
</FN>
</TABLE>
See notes to financial statements.
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities December 31, 1997
Cost Value
------------- -------------
<S> <C> <C> <C>
ASSETS: Investments in securities--See Statement of Investments $579,410,497 $664,514,905
Cash............................................. 263,916
Cash denominated in foreign currencies........... 1,724,521 1,691,750
Receivable for investment securities sold........ 17,476,940
Dividends and interest receivable................ 1,057,324
Receivable for shares of Beneficial Interest subscribed 24,348
------------
685,029,183
------------
LIABILITIES: Due to The Dreyfus Corporation and affiliates.... 663,192
Due to Distributor............................... 6,882
Payable for shares of Beneficial Interest redeemed 14,687,752
Payable for investment securities purchased...... 2,752,878
Loan commitment fees payable--Note 4............. 793
Net unrealized depreciation on forward currency
exchange contracts--Note 1(d).................. 27
------------
18,111,524
------------
NET ASSETS..................................................................... $666,917,659
============
REPRESENTED BY: Paid-in capital.................................. $566,418,002
Accumulated distributions in excess of investment income--net (166,406)
Accumulated net realized gain (loss) on investments 15,596,052
Accumulated net unrealized appreciation (depreciation)
on investments and foreign currency transactions 85,070,011
------------
NET ASSETS..................................................................... $666,917,659
============
</TABLE>
NET ASSET VALUE PER SHARE
-------------------------
<TABLE>
<CAPTION>
Investor Institutional Restricted
Shares Shares Shares
------- ---------- ----------
<S> <C> <C> <C>
Net Assets..................................................... $585,623,538 $80,427,384 $866,737
Shares Outstanding............................................. 19,447,087 2,672,145 28,789
NET ASSET VALUE PER SHARE...................................... $30.11 $30.10 $30.11
====== ====== ======
</TABLE>
See notes to financial statements.
<TABLE>
<CAPTION>
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Operations Year Ended December 31, 1997
<S> <C> <C> <C>
INVESTMENT INCOME
INCOME: Cash dividends (net of $295,970 foreign taxes
withheld at source)...................... $ 10,916,836
Interest................................... 655,106
------------
Total Income.......................... $ 11,571,942
EXPENSES: Management fee--Note 2(a).................. 5,842,985
Distribution fees--Note 2(b)............... 1,511,675
Loan commitment fees--Note 4............... 7,501
------------
Total Expenses........................ 7,362,161
Less--reduction in management fee due to
undertaking--Note 2(a)................... (48,650)
------------
Net Expenses.......................... 7,313,511
------------
INVESTMENT INCOME--NET................................................... 4,258,431
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--Note 3:
Net realized gain (loss) on investments and
foreign currency transactions............ $134,824,605
Net realized gain (loss) on forward currency
exchange contracts....................... (27,883)
------------
Net Realized Gain (Loss).............. 134,796,722
Net unrealized appreciation (depreciation) on
investments and foreign currency transactions 2,183,414
------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS................... 136,980,136
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS..................... $141,238,567
============
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended Year Ended
December 31, 1997* December 31, 1996
----------------- -----------------
<S> <C> <C>
OPERATIONS:
Investment income--net................................................. $ 4,258,431 $ 5,073,942
Net realized gain (loss) on investments................................ 134,796,722 101,383,784
Net unrealized appreciation (depreciation) on investments.............. 2,183,414 (5,105,765)
------------- -------------
Net Increase (Decrease) in Net Assets Resulting from Operations.. 141,238,567 101,351,961
------------- -------------
DIVIDENDS TO SHAREHOLDERS:
From investment income--net:
Investor shares..................................................... (3,766,094) (4,113,567)
Institutional shares................................................ (593,353) (647,083)
Restricted shares................................................... (124,133) (124,067)
In excess of investment income-net:
Investor shares..................................................... (139,777) --
Institutional shares................................................ (22,022) --
Restricted shares................................................... (4,607) --
From net realized gain on investments:
Investor shares..................................................... (117,738,346) (80,205,392)
Institutional shares................................................ (16,088,315) (11,721,876)
Restricted shares................................................... (2,973,474) (1,866,594)
------------- -------------
Total Dividends.................................................. (141,450,121) (98,678,579)
------------- -------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Investor shares..................................................... 145,936,701 110,377,880
Institutional shares................................................ 22,101,585 14,132,483
Restricted shares................................................... 1,897,752 11,380,217
Dividends reinvested:
Investor shares..................................................... 104,964,016 74,407,664
Institutional shares................................................ 16,151,789 11,944,449
Restricted shares................................................... 3,102,096 1,990,968
Cost of shares redeemed:
Investor shares..................................................... (152,159,333) (101,845,407)
Institutional shares................................................ (29,635,346) (30,775,024)
Restricted shares................................................... (15,558,384) (1,424,273)
------------- -------------
Increase (Decrease) in Net Assets from Beneficial Interest Transactions 96,800,876 90,188,957
------------- -------------
Total Increase (Decrease) in Net Assets....................... 96,589,322 92,862,339
------------- -------------
NET ASSETS:
Beginning of Period.................................................... 570,328,337 477,465,998
------------- -------------
End of Period.......................................................... $ 666,917,659 $ 570,328,337
============= =============
Undistributed investment income (distributions in excess of investment income)--net $ (166,406) $ 225,149
------------- -------------
<FN>
- ---------------
* Effective August 15,1997, Class R shares were redesignated as Restricted shares.
</FN>
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Statement of Changes in Net Assets (continued)
<TABLE>
<CAPTION>
Shares
------------------------------------
Year Ended Year Ended
December 31, 1997* December 31, 1996
------------------ -----------------
<S> <C> <C>
CAPITAL SHARE TRANSACTIONS:
Investor Shares
---------------
Shares sold............................................................ 4,295,680 3,375,086
Shares issued for dividends reinvested................................. 3,583,594 2,435,917
Shares redeemed........................................................ 4,447,295) (3,126,844)
---------- ----------
Net Increase (Decrease) in Shares Outstanding........... 3,431,979 2,684,159
========== ==========
Institutional Shares
------------------
Shares sold............................................................ 629,753 430,202
Shares issued for dividends reinvested................................. 551,297 391,174
Shares redeemed........................................................ (875,068) (965,361)
---------- ----------
Net Increase (Decrease) in Shares Outstanding........... 305,982 (143,985)
========== ==========
Restricted Shares
-----------------
Shares sold............................................................ 54,551 354,824
Shares issued for dividends reinvested................................. 105,597 65,018
Shares redeemed........................................................ (512,826) (44,489)
---------- ----------
Net Increase (Decrease) in Shares Outstanding........... (352,678) 375,353
========== ==========
<FN>
- -----------
* Effective August 15,1997, Class R shares were redesignated as Restricted
shares.
</FN>
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Financial Highlights
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
Investor Shares(1)
------------------------------------------------------
Year Ended December 31,
------------------------------------------------------
PER SHARE DATA: 1997 1996 1995 1994(2) 1993(3)
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............. $30.40 $30.13 $24.56 $27.80 $25.46
------ ------ ------ ------ ------
Investment Operations:
Investment income--net............................ .22 .31 .41 .42 .31
Net realized and unrealized gain (loss) on investments 6.98 6.03 8.24 (.29) 3.86
------ ------ ------ ------ ------
Total from Investment Operations.................. 7.20 6.34 8.65 .13 4.17
------ ------ ------ ------ ------
Distributions:
Dividends from investment income--net............. (.23) (.30) (.45) (.40) (.30)
Dividends in excess of investment income--net..... (.01) -- -- -- --
Dividends from net realized gain on investments... (7.25) (5.77) (2.63) (2.97) (1.53)
------ ------ ------ ------ ------
Total Distributions............................... (7.49) (6.07) (3.08) (3.37) (1.83)
------ ------ ------ ------ ------
Net asset value, end of period.................... $30.11 $30.40 $30.13 $24.56 $27.80
====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN.............................. 25.21% 21.44% 35.56% .38% 16.51%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets........... 1.14% 1.13% 1.13% 1.11% 1.15%
Ratio of net investment income to average net assets .64% .96% 1.43% 1.47% 1.13%
Decrease reflected in above expense ratios
due to undertakings by the Manager............. .01% .02% .02% .01% .01%
Portfolio Turnover Rate........................... 92.99% 88.46% 54.42% 73.00% 75.00%
Average commission rate paid(4)................... $.0478 $.0522 -- -- --
Net Assets, end of period (000's Omitted)......... $585,624 $486,816 $401,674 $317,868 $349,813
<FN>
- -----------
(1) On February 1, 1993 existing shares of the Fund were designated the Retail
Class and effective April 4, 1994 the Retail Class shares were
reclassified as Investor Shares.
(2) Prior to April 4, 1994, The Boston Company Advisors, Inc. served as the
Fund's investment adviser. From April 4, 1994 through October 16, 1994,
Mellon Bank, N.A. served as the Fund's investment manager. Effective
October 17, 1994, The Dreyfus Corporation serves as the Fund's investment
manager.
(3) Per share amounts have been calculated using the monthly average share
method.
(4) For fiscal years beginning January 1, 1996, the Fund is required to
disclose its average commission rate paid per share for purchases and
sales of investment securities.
</FN>
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Financial Highlights (continued)
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
Institutional Shares(2)
----------------------------------------------------
Year Ended December 31, Period Ended
--------------------------------------- December 31,
PER SHARE DATA: 1997 1996 1995 1994(1) 1993(2)(3)
------- ------- ------- ------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period.............. $30.38 $30.12 $24.56 $27.80 $25.96
------ ------ ------ ------ ------
Investment Operations:
Investment income--net............................ .26 .36 .47 .47 .32
Net realized and unrealized gain (loss) on investments 6.98 6.01 8.20 (.31) 3.38
------ ------ ------ ------ ------
Total from Investment Operations.................. 7.24 6.37 8.67 .16 3.70
------ ------ ------ ------ ------
Distributions:
Dividends from investment income--net............. (.26) (.34) (.48) (.43) (.33)
Dividends in excess of investment income--net..... (.01) -- -- -- --
Dividends from net realized gain on investments... (7.25) (5.77) (2.63) (2.97) (1.53)
------ ------ ------ ------ ------
Total Distributions............................... (7.52) (6.11) (3.11) (3.40) (1.86)
------ ------ ------ ------ ------
Net asset value, end of period.................... $30.10 $30.38 $30.12 $24.56 $27.80
====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN.............................. 25.34% 21.57% 35.60% .49% 14.38%(4)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets........... 1.04% 1.03% 1.03% 1.02% .95%(4)
Ratio of net investment income to average net assets .74% 1.07% 1.53% 1.57% 1.13%(4)
Decrease reflected in above expense ratios
due to undertakings by the Manager............. .01% .02% .02% .01% --
Portfolio Turnover Rate........................... 92.99% 88.46% 54.42% 73.00% 75.00%
Average commission rate paid(5)................... $.0478 $.0522 -- -- --
Net Assets, end of period (000's Omitted)......... $80,427 $71,894 $75,607 $59,435 $79,656
<FN>
- -----------
(1) Prior to April 4, 1994, The Boston Company Advisors, Inc. served as the
Fund's investment adviser. From April 4, 1994 through October 16, 1994,
Mellon Bank, N.A. served as the Fund's investment manager. Effective
October 17, 1994, The Dreyfus Corporation serves as the Fund's investment
manager.
(2) On February 1, 1993, the Fund commenced selling Institutional shares.
(3) Per share amounts have been calculated using the monthly average share
method.
(4) Not annualized.
(5) For years beginning January 1, 1996, the Fund is required to disclose its
average commission rate paid per share for purchases and sales of investment
securities.
</FN>
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Financial Highlights (continued)
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
Restricted Shares
-------------------------------------------
Year Ended December 31, Period Ended
---------------------------- December 31,
PER SHARE DATA: 1997(1)(2) 1996 1995 1994(3)(4)
--------- -------- ------- ----------
<S> <C> <C> <C> <C>
Net asset value, beginning of period....................... $30.46 $30.18 $24.56 $28.45
------ ------ ------ ------
Investment Operations:
Investment income--net..................................... .33 .36 .62 .29
Net realized and unrealized gain (loss) on investments..... 6.90 6.08 8.16 (.83)
------ ------ ------ ------
Total from Investment Operations........................... 7.23 6.44 8.78 (.54)
------ ------ ------ ------
Distributions:
Dividends from investment income--net...................... (.32) (.39) (.53) (.38)
Dividends in excess of investment income--net.............. (.01) -- -- --
Dividends from net realized gain on investments............ (7.25) (5.77) (2.63) (2.97)
------ ------ ------ ------
Total Distributions........................................ (7.58) (6.16) (3.16) (3.35)
------ ------ ------ ------
Net asset value, end of period............................. $30.11 $30.46 $30.18 $24.56
====== ====== ====== ======
TOTAL INVESTMENT RETURN....................................... 24.54% 21.74% 36.05% (2.31%)(5)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets.................... .89% .88% .88% .35%(5)
Ratio of net investment income to average net assets....... .88% 1.23% 1.93% .70%(5)
Decrease reflected in above expense ratios
due to undertakings by the Manager...................... .01% .02% .02% .01%(5)
Portfolio Turnover Rate.................................... 92.99% 88.46% 54.42% 73.00%
Average commission rate paid(6)............................ $.0478 $.0522 -- --
Net Assets, end of period (000's Omitted).................. $867 $11,618 $185 $1,070
<FN>
- -----------
(1) Effective August 15,1997, Class R shares were redesignated as Restricted
shares.
(2) Per share amounts have been calculated using the monthly average share
method.
(3) On August 4, 1994, the Fund commenced selling Trust shares. Effective
October 17, 1994 the Trust shares were reclassified as Class R shares.
(4) From August 4, 1994 through October 16, 1994, Mellon Bank, N.A. served as
the Fund's investment manager. Effective October 17, 1994, The Dreyfus
Corporation serves as the Fund's investment manager.
(5) Not annualized.
(6) For years beginning January 1, 1996, the Fund is required to disclose its
average commission rate paid per share for purchases and sales of
investment securities.
</FN>
</TABLE>
See notes to financial statements.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
NOTE 1--Significant Accounting Policies:
Dreyfus Core Value Fund (the "Fund") is a series of The Dreyfus/Laurel Funds
Trust (the "Trust") which is registered under the Investment Company Act of 1940
("Act") as a diversified open-end management investment company and operates as
a series company currently offering three series including the Fund. The Fund's
investment objective is to seek long-term growth of capital and current income.
The Dreyfus Corporation ("Manager") serves as the Fund's investment manager. The
Manager is a direct subsidiary of Mellon Bank, N.A. ("Mellon Bank").
Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor of
the Fund's shares. Effective August 15, 1997, Class R shares were redesignated
as Restricted shares. The Fund is authorized to issue an unlimited number of
shares of Beneficial Interest in the following classes of shares: Investor,
Institutional and Restricted. Investor shares are sold primarily to retail
investors and bear a distribution fee. Institutional shares are offered only to
those customers of certain financial planners and investment advisers who held
shares of a predecessor class of the Fund as of April 4, 1994, and bear a
distribution fee. Restricted shares are sold primarily to bank trust departments
and other financial service providers (including Mellon Bank and its affiliates)
acting on behalf of customers having a qualified trust or investment account or
relationship at such institution, and bear no distribution fee. Each class of
shares has identical rights and privileges, except with respect to the
distribution fee and voting rights on matters affecting a single class.
Investment income, net of expenses (other than class specific expenses) and
realized and unrealized gains and losses are allocated daily to each class of
shares based upon the relative proportion of net assets of each class.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumptions. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: Investments in securities are valued at the last
sales price on the securities exchange on which such securities are primarily
traded or at the last sales price on the national securities market. Securities
not listed on an exchange or the national securities market, or securities for
which there were no transactions, are valued at the average of the most recent
bid and asked prices. Bid price is used when no asked price is available.
Securities for which there are no such valuations are valued at fair value as
determined in good faith under the direction of the Board of Trustees.
Investments denominated in foreign currencies are translated to U.S. dollars at
the prevailing rates of exchange. Forward currency exchange contracts are valued
at the forward rate.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions
are recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Dividend income is
recognized on the ex-dividend date and interest income, including, where
applicable, amortization of discount on investments, is recognized on the
accrual basis.
(C) FOREIGN CURRENCY TRANSACTIONS: The Fund does not isolate that portion of
the results of operations resulting from changes in foreign exchange rates on
investments from the fluctuations arising from changes in the market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and maturities
of short-term securities, sales of foreign currencies, currency gains or losses
realized on securities transactions and the difference between the amount of
dividends, interest, and foreign withholding taxes recorded on the Fund's books
and the U.S. dollar equivalent of the amounts actually received or paid. Net
unrealized foreign exchange gains and losses arise from changes in the value of
assets and liabilities other than investments in securities, resulting from
changes in exchange rates. Such gains and losses are included with net realized
and unrealized gain or loss on investments.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
(D) FORWARD CURRENCY EXCHANGE CONTRACTS: The Fund enters into forward
currency exchange contracts in order to hedge its exposure to changes in foreign
currency exchange rates on its foreign portfolio holdings and to settle foreign
currency transactions. When executing forward currency exchange contracts, the
Fund is obligated to buy or sell a foreign currency at a specified rate on a
certain date in the future. With respect to sales of forward currency exchange
contracts, the Fund would incur a loss if the value of the contract increases
between the date the forward contract is opened and the date the forward
contract is closed. The Fund realizes a gain if the value of the contract
decreases between those dates. With respect to purchases of forward currency
exchange contracts, the Fund would incur a loss if the value of the contract
decreases between the date the forward contract is opened and the date the
forward contract is closed. The Fund realizes a gain if the value of the
contract increases between those dates. The Fund is also exposed to credit risk
associated with counter party nonperformance on these forward currency exchange
contracts which is typically limited to the unrealized gain on each open
contract. In addition, the following summarizes open forward currency exchange
contracts at December 31, 1997:
<TABLE>
<CAPTION>
Foreign Currency Unrealized
Forward Currency Exchange Contracts Amounts Proceeds Value (Depreciation)
- --------------------------------- ---------------- -------- ----- ------------
<S> <C> <C> <C> <C>
Sales:
- -----
Mexican Pesos, expiring 1/5/98............. 100,994 $12,513 $12,514 $ (1)
Purchases: Cost
- --------- --------
Singapore Dollars, expiring 1/5/98......... 37,334 22,176 22,150 (26)
----
Total...................................... $(27)
====
</TABLE>
(E) DISTRIBUTIONS TO SHAREHOLDERS: Dividends are recorded on the ex-divided
date. Dividends from investment income-net are declared and paid on a quarterly
basis. Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to comply
with the distribution requirements of the Internal Revenue Code. To the extent
that net realized capital gain can be offset by capital loss carryovers, if any,
it is the policy of the Fund not to distribute such gain.
(F) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to qualify
as a regulated investment company, if such qualification is in the best
interests of its shareholders, by complying with the applicable provisions of
the Internal Revenue Code, and to make distributions of taxable income
sufficient to relieve it from substantially all Federal income and excise taxes.
NOTE 2--Investment Management Fee and Other Transactions With Affiliates:
(A) INVESTMENT MANAGEMENT FEE: Pursuant to an Investment Management agreement
with the Manager, the Manager provides or arranges for one or more third parties
and/or affiliates to provide investment advisory, administrative, custody, fund
accounting and transfer agency services to the Fund. The Manager also directs
the investments of the Fund in accordance with its investment objective,
policies and limitations. For these services, the Fund is contractually
obligated to pay the Manager a fee, calculated daily and paid monthly, at the
annual rate of .90% of the value of the Fund's average daily net assets. Out of
its fee, the Manager pays all of the expenses of the Fund except brokerage fees,
taxes, interest, commitment fees, Rule 12b-1 distribution fees and expenses,
fees and expenses of non-interested Trustees (including counsel fees) and
extraordinary expenses. In addition, the Manager is required to reduce its fee
in an amount equal to the Fund's allocable portion of fees and expenses of the
non-interested Trustees (including counsel). Each trustee receives $27,000 per
year, $1,000 for each Board meeting attended and $750 for each Audit
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
Committee meeting attended and is reimbursed for travel and out-of-pocket
expenses. The Chairman of the Board receives an additional annual fee of $25,000
per year. These fees pertain to the following funds: The Dreyfus/Laurel Funds,
Inc., The Dreyfus/Laurel Tax-Free Municipal Funds, and The Dreyfus/Laurel Funds
Trust. These fees and expenses are allocated to each series based on net assets.
Amounts required to be paid by the Trust directly to the non-interested
Trustees, that would be applied to offset a portion of the management fee
payable to the Manager, are in fact paid directly by the Manager to the
non-interested Trustees.
The Manager had voluntarily agreed from January 1, 1997 through May 31, 1997
to waive at an annual rate of .02% of the value of the Fund's average daily net
assets of its fee mentioned above. The reduction in management fee, pursuant to
the undertaking, amounted to $48,650 during the period ended December 31, 1997.
(B) DISTRIBUTION PLAN: Under the Distribution Plan (the "Plan") adopted
pursuant to Rule 12b-1 under the Act, the Fund may pay annually up to .25% of
the value of the average daily net assets attributable to its Investor shares
and up to .15% of the value of the average daily net assets attributable to its
Institutional shares to compensate the Distributor and Dreyfus Service
Corporation, an affiliate of the Manager, for shareholder servicing activities
and the Distributor for activities primarily intended to result in the sale of
Investor and Institutional shares. The Restricted shares bear no distribution
fee. During the period ended December 31, 1997, the Fund was charged $116,522
and $1,395,153, respectively, pursuant to the Plan.
Under its terms, the Plan shall remain in effect from year to year, provided
such continuance is approved annually by a vote of majority of those Trustees
who are not "interested persons" of the Trust and who have no direct or indirect
financial interest in the operation of the Plan or in any agreement related to
the Plan.
NOTE 3--Securities Transactions:
The aggregate amount of purchases and sales of investment securities,
excluding short-term securities and forward currency exchange contracts, during
the period ended December 31, 1997 amounted to $586,686,356 and $611,770,687,
respectively.
At December 31, 1997, accumulated net unrealized appreciation on investments
and forward currency exchange contracts was $85,104,381, consisting of
$107,176,225 gross unrealized appreciation and $22,071,844 gross unrealized
depreciation.
At December 31, 1997, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
NOTE 4--Bank Line of Credit:
The Fund participates with other Dreyfus-managed funds in a $600 million
redemption credit facility ("Facility") to be utilized for temporary or
emergency purposes, including the financing of redemptions. In connection
therewith, the Fund has agreed to pay commitment fees on its pro rata portion of
the Facility. Interest is charged to the Fund at rates based on prevailing
market rates in effect at the time of borrowings. During the period ended
December 31, 1997, the Fund did not borrow under the Facility.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
NOTE 5--Subsequent Event:
On November 20, 1997, Fund shareholders approved a reorganization, effective
January 15, 1998, in which the Fund's name will be changed to Dreyfus Premier
Core Value Fund. The Fund will offer five classes of shares: Class A shares,
Class B shares, Class C shares, Class R shares and Institutional shares. Class A
shares will be subject to an initial sales charge at the time of purchase and
Class B and C shares will be subject to contingent deferrred sales charges.
Former Investor shares will be redesignated as Class A shares and former
Restricted shares will be redesignated as Class R shares. Holders of Investor
shares will continue to be eligible to purchase Class A shares at NAV (without
an initial sales charge) and holders of Restricted shares will be eligible to
purchase Class R shares at NAV. The existing Institutional class will remain as
the Institutional class.
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Independent Auditors' Report
THE BOARD OF TRUSTEES AND SHAREHOLDERS
THE DREYFUS/LAUREL FUNDS TRUST:
We have audited the accompanying statement of assets and liabilities,
including the statement of investments, of Dreyfus Core Value Fund of The
Dreyfus/Laurel Funds Trust as of December 31, 1997, and the related statement of
operations for the year then ended, the statements of changes in net assets for
each of the years in the two-year period then ended, and the financial
highlights for each of the years or periods in the four-year period then ended.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits. The financial
highlights for each of the year or period ended December 31, 1993 were audited
by other auditors whose report thereon, dated February 14, 1994, expressed an
unqualified opinion on those financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit also includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. Our procedures included confirmation of securities owned
as of December 31, 1997, by correspondence with the custodian. As to securities
purchased and sold, but not received or delivered, we performed other
appropriate auditing procedures. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Dreyfus Core Value Fund of The Dreyfus/Laurel Funds Trust as of December 31,
1997, the results of its operations for the year then ended, changes in its net
assets for each of the years in the two-year period then ended and its financial
highlights for each of the years or periods in the four-year period then ended,
in conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
New York, New York
February 18, 1998
<PAGE>
Dreyfus Core Value Fund
- --------------------------------------------------------------------------------
Important Tax Information (Unaudited)
For Federal Tax purposes the Fund hereby designates $3.811 per share as a
long-term capital gain distribution (of which 63.40% is subject to the 20%
maximum Federal tax rate) paid on December 24, 1997 and also designates $.554
per share as a long-term capital gain distribution paid on March 31, 1997.
The Fund also designates 20.12% of the ordinary dividends paid during the
fiscal year ended December 31, 1997 as qualifying for the corporate dividends
received deduction.
<PAGE>
Dreyfus Core Value Fund
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, PA 15258
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. CORAR9712
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN
DREYFUS PREMIER CORE VALUE FUND CLASS A SHARES AND THE
STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
EXHIBIT A:
DREYFUS
PREMIER CORE STANDARD & POOR'S
PERIOD VALUE FUND 500 COMPOSITE
(CLASS A SHARES) STOCK PRICE INDEX*
12/31/87 9,425 10,000
12/31/88 11,267 11,656
12/31/89 14,079 15,343
12/31/90 12,187 14,866
12/31/91 14,974 19,385
12/31/92 15,578 20,860
12/31/93 18,150 22,958
12/31/94 18,212 23,259
12/31/95 24,689 31,988
12/31/96 29,982 39,330
12/31/97 37,541 52,448
*Source: Lipper Analytical Services, Inc.
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN
DREYFUS CORE VALUE FUND INVESTOR SHARES AND THE
STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
EXHIBIT A:
DREYFUS STANDARD
CORE & POOR'S
VALUE FUND 500 COMPOSITE
PERIOD (INVESTOR STOCK PRICE
SHARES) INDEX*
12/31/87 10,000 10,000
12/31/88 11,954 11,656
12/31/89 14,937 15,343
12/31/90 12,931 14,866
12/31/91 15,888 19,385
12/31/92 16,528 20,860
12/31/93 19,257 22,958
12/31/94 19,323 23,259
12/31/95 26,195 31,988
12/31/96 31,811 39,330
12/31/97 39,831 52,448
*Source: Lipper Analytical Services, Inc.
