<PAGE> 1
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
Semiannual Report December 31, 1994
[FIGURE NUMBER 1]
Photo of man sitting at side of swimming pool
"I need to
diversify
to get the
best overall
performance
from my
investment
portfolio."
[LOGO]
<PAGE> 2
NEWS
"THIS RELATIVELY STURDY VEHICLE
IS STILL AN APPROPRIATE CHOICE
FOR MORE CAUTIOUS GOLDBUGS."
-Morningstar Mutual Funds
10/28/94
OUTPERFORMED AVERAGE
Cumulative Total Return for the
10-Year Period Ended 12/31/94:
Oppenheimer Gold & Special
Minerals Fund(1)
209.86%
Lipper Gold-Oriented Funds
Average(2)
96.90%
This Fund is for people who want a growth investment that is intended to help
offset some of the risks of the other investments in their portfolio.
HOW YOUR FUND IS MANAGED
Oppenheimer Gold & Special Minerals Fund invests in the stocks of companies
engaged in mining, processing, fabricating or distributing gold and other metals
or minerals. Investing in stocks of gold and other precious and strategic metals
producers can provide a hedge against inflation and declines in stock prices
that reflect a weakening U.S. dollar. So, as a Fund shareholder, you may benefit
from having a portion of your overall portfolio designed to offset the risks of
your other investments.
PERFORMANCE
Total return at net asset value for the 6 months ended 12/31/94 was 0.97%(3).
The financial markets had a difficult year and, like many mutual funds,
your Fund felt the effects. While difficult years are hard to accept, they're an
inevitable part of investing. That's why keeping a long-term perspective is
crucial to getting the most from your investment and help-ing you through
short-term market fluctuations.
Your Fund's average annual total returns at maximum offering price for the
1-, 5-, and 10-year periods ended 12/31/94 were -11.37%, -1.08% and 11.97%,
respectively(4).
OUTLOOK
"We believe we're in a favorable environment for this Fund--there's concern
about rising inflation, but no signs of runaway inflation. We manage the
portfolio for moderate moves in inflation and gold prices, focusing on companies
with strong cash flows and proven explo-ration and production capabilities. In
periods like the one we're in today--and should be in for some time--this Fund
should outperform funds that focus on the stocks of more speculative companies
whose operating results are more leveraged to the gold price."
Jim Ayer, Portfolio Manager
December 31, 1994
1. Based on total return for the period shown, after deducting the current
maximum sales charge of 5.75%.
2. Source: Lipper Analytical Services, an independent mutual fund monitoring
service. The Lipper total return average for the 10-year period was for 13
gold-oriented funds. The average is shown for comparative purposes only.
Oppenheimer Gold & Special Minerals Fund is characterized by Lipper as a
gold-oriented fund. Lipper performance does not take sales charges into
consideration.
3. Based on the change in net asset value per share from 6/30/94 to 12/31/94,
without deducting any sales charges. Such performance would have been lower if
sales charges were taken into account.
4. Average annual total returns are based on a hypothetical investment held
until 12/31/94, after deducting the current maximum initial sales charge of
5.75%. The Fund's maximum sales charge rate was higher during the periods shown,
and actual investment results will be different as a result of the change. 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 Gold & Special Minerals Fund
<PAGE> 3
Dear OppenheimerFunds Shareholder,
The past year has been a difficult period for the stock market, one marked above
all by one of the most aggressive series of moves to raise interest rates in the
U.S. Federal Reserve's history. As interest rates moved up, bond prices fell and
the stock market followed, while investors looked everywhere for answers to
questions about directions in inflation, interest rates, and the economy. These
questions all concerned one basic issue: Is the bull market in stocks coming to
an end?
In our view, it is not. While we are not expecting major gains in stock
prices in the very near term, we believe that the uncertainties which held the
market back in 1994 will recede in 1995 as the fundamental positives in the
economy are recognized. The most important of these positives is our belief that
the Fed's attempt to preempt possible inflation, while temporarily
disconcerting, will likely have its desired effect in 1995. We believe that the
economy will begin to slow, and although short-term rates may move up modestly
from their present levels, long-term interest rates--the ones that most affect
securities prices--should stabilize in their current range. Long-term rates may
even begin to decline as overblown concerns about inflation abate.
Those concerns are, in fact, already fading. While the prices of some
commodities have risen over the past year and U.S. manufacturing capacity
utilization and employment rose to their highest levels in years, in today's
globally competitive environment, price increases are difficult to pass on to
either consumers or businesses. The inflation rate--as measured by the Consumer
Price Index-continues to run at less than 3% a year, and there's nothing on the
horizon to suggest to us that it will increase substantially anytime soon. Even
at their current levels, interest rates remain low relative to recent periods,
and in our view, pose no real threat to most companies' earnings or cash flows.
During the most recent recession, many businesses learned to operate much more
efficiently and took advantage of the extended decline in interest rates to work
down their debt loads and strengthen their financial positions. As a result,
corporate profits have soared despite higher interest rates. And we believe that
business earnings should grow even more as economies in Europe and elsewhere
emerge from their recessions, stimulating demand for U.S. companies' goods and
services. As profits rise, we expect stocks to become more valuable.
Finally, the changing political landscape reflected in results of the
mid-term election bodes well for the stock market over time. In addition to
limiting the expectation that Congress will pass potentially inflationary
government spending proposals, the realignment in Washington has raised the
possibility of tax relief in the form of an expanded deduction for individual
retirement savings or possibly a reduction in the capital gains tax rate. What
specific action, if any, Congress will take on these proposals remains to be
seen. But any action to reduce the federal deficit, cut spending, and reduce
taxes should be good news for the stock market overall.
In light of all these factors, we remain bullish on stocks. As we have
noted in previous reports, we're expecting moderate gains in the short-term, in
line with increasing corporate earnings. Over time, however, we expect stocks to
perform well in both the U.S. and foreign markets. Your portfolio manager
discusses the outlook for your Fund on the following pages. We appreciate your
confidence, and we look forward to helping you continue to reach your investment
goals.
Donald W. Spiro Jon S. Fossel
- ---------------- -------------
Donald W. Spiro Jon S. Fossel
January 23, 1995
[FIGURE NUMBER 2]
Photo of Donald W. Spiro
Donald W. Spiro
President
Oppenheimer
Gold &Special
Minerals Fund
[FIGURE NUMBER 3]
Photo of Jon S. Fossel
Jon S. Fossel
Chairman and CEO
Oppenheimer
Management
Corporation
3 Oppenheimer Gold & Special Minerals Fund
<PAGE> 4
Q + A
Q What
is your
outlook
for the Fund?
[FIGURE NUMBER 4]
Photo of Jim Ayer
[FIGURE NUMBER 5]
Photo of Bill Wilby
An interview with your Fund's manager.
OVER THE LAST 12 MONTHS, THE FUND'S TOTAL RETURN AT NET ASSET VALUE WAS NEGATIVE
YET IT SIGNIFICANTLY OUTPERFORMED SIMILAR FUNDS AS MEASURED BY THE LIPPER
GOLD-ORIENTED FUNDS' AVERAGE. WHAT FACTORS CONTRIBUTED TO THE FUND'S
PERFORMANCE?
We were helped by the macro-economic environment. There's enough concern about
inflation to keep gold prices on a gradual uptrend, but no sign of runaway
inflation. This is an environment in which this Fund thrives.
The gold market's fundamentals also remain positive. Demand for gold--for
jewelry fabrication--continues to outpace supply. In fact, output from the
former Soviet Union, a major source of gold, has been declining as a result of
the political turmoil that region is experiencing. At the same time, selling by
central banks has abated. We believe that certain central banks may be seeking
to strengthen their currencies by building gold reserves.
Those factors--an ideal environment and strong fun-damentals--have worked
in the Fund's favor. And they have been reinforced in recent months by the
performance of companies that produce other metals, including cop-per, aluminum,
nickel, zinc, and platinum.
It's important to emphasize that the Fund focuses on stocks of proven,
financially sound, low-cost mining companies rather than the highly leveraged,
high-cost operators that certain other gold-oriented funds may tend to
emphasize. Like all gold-oriented mutual funds, the Fund is subject to the risk
of adverse performance of the mining and metals industries in which it invests.
However, we believe that focusing on quality companies and diversifying assets
in other metals helps reduce that risk.
HOW HAVE METALS OTHER THAN GOLD HELPED THE FUND'S PERFORMANCE?
It's always helpful to have some diversification away from gold within the
Fund's portfolio to reduce volatility and control risk. In recent months,
however, the prices of many metals have risen strongly, reversing a three-year
trend of declining prices-
4 Oppenheimer Gold & Special Minerals Fund
<PAGE> 5
FACING PAGE
Left: Jim Ayer, Portfolio Manager
Right: Bill Wilby, Senior VP, Director of Global Investments
THIS PAGE
Jim Ayer speaks with George Evans, a member of the Equity Investments team.
A Extremely
positive.
We think the
economic
environment
is right for
this Fund.
[FIGURE NUMBER 6]
Photo of Jim Ayer and George Evans
a time in which companies spent little on exploration or expanded production.
They concentrated instead on improving operating efficiency, and as a result,
the companies we hold are positioned for powerful earnings gains from higher
metals prices.
GOLD EXPLORATION OUTSIDE NORTH AMERICA SEEMS TO HAVE BEEN INCREASING RAPIDLY
OVER THE PAST YEAR. HAVE YOU CAPITALIZED ON THIS INTERNATIONAL "GOLD RUSH"?
Yes, we have. Governments in Latin America, West Africa, and South East Asia
have been encouraging companies to help them develop their gold resources. This
is one of the most exciting developments we've seen in years, and the companies
in the Fund's portfolio--Placer Dome, Newmont Mining and Freeport-McMoRan--are
among the best at global exploration and production. In addition to those
companies, we've also added several new names to the portfolio over the last six
months.
Of course, foreign investments can subject the Fund to greater expenses
and risks, such as adverse currency fluctuations. However, we believe that the
Fund's focus on quality companies and, as we mentioned before, diversifying
assets in other metals helps the Fund reduce those risks.
WHERE HAVE YOU FOCUSED YOUR BUYING?
In Latin America, we've added several exploration companies, including Golden
Star Resources and Cambiex Exploration, both of which have significant shares of
the Omai mine and interesting tracts in French Guyana and Surinam. We also
increased our positions in Battle Mountain, which has a major stake in the
highly successful Korikollo mine in Bolivia; in Newmont Mining, which recently
announced a major discovery in the Yanicocha trend in Peru; and in TVX, which
recently announced a large discovery in Ecuador.
In Africa, we own Ashanti Goldfields, a growing low-cost producer located
in Ghana. We've added slightly to our holdings in South Africa, but we think the
greatest potential for exploration and growth is in West Africa.
In North America, we continue to focus on companies bringing new
processing technologies to bear on Nevada's Carlin trend, the largest deposit on
the continent. Newmont Mining has long been a major player and a major Fund
holding; that company is now leading the move to underground mining in the
Carlin trend(1)
WHAT'S YOUR OUTLOOK FOR THE FUND GOING FORWARD?
At this point, we think the outlook is extremely positive. The economic
environment is right for this Fund, and we have positions in some of the world's
strongest gold and industrial metals companies. As long as inflation rises
moderately, the global economy continues to grow strongly, and the gold price
increases gradually, the Fund should continue to produce superior returns. -
1. The Fund's portfolio is subject to change.
5 Oppenheimer Gold & Special Minerals Fund
<PAGE> 6
STATEMENT OF INVESTMENTS December 31, 1994
(Unaudited)
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT SEE NOTE 1
------ ------------
<S> <C> <C> <C>
REPURCHASE AGREEMENTS--6.7%
Repurchase agreement with First Chicago Capital
Markets, 6%, dated 12/30/94, to be repurchased at
$12,008,000 on 1/3/95, collateralized by U.S.
Treasury Nts., 3.875%--8.875%, 5/31/95--8/31/05,
with a value of $11,411,862 and U.S. Treasury
Bonds, 10.75%--14.25%, 2/15/02--8/15/05, with a
value of $838,321 (Cost $12,000,000) $12,000,000 $12,000,000
CORPORATE BONDS AND NOTES--1.3%
ENERGY--1.3% Teck Corp., 6%, 7/15/06 (Cost $1,960,526) 2,400,000 2,238,000
</TABLE>
<TABLE>
<CAPTION>
SHARES
------
<S> <C> <C> <C>
COMMON STOCKS--89.4%
BASIC MATERIALS--86.6%
CHEMICALS: SPECIALTY--4.5% Engelhard Corp. 200,000 4,450,000
Johnson Matthey PLC 250,000 2,131,631
Minerals Technologies, Inc. 50,000 1,462,500
-----------
8,044,131
GOLD--65.3%
DIAMOND MINING AND Ashton Mining Ltd. 189,600 316,190
MARKETING--0.3% Ashton Mining of Canada, Inc.(1) 200,000 104,086
Ashton Mining of Canada, Inc.(1) 200,000 104,086
-----------
524,362
GOLD MINING: AUSTRALIA--9.5% Gold Mines of Kalgoorlie Ltd. 2,597,604 2,014,850
Highlands Gold Ltd. 1,500,000 1,396,182
Lynas Gold Ltd.(1) 4,200,000 651,552
Newcrest Mining Ltd. 1,000,000 4,460,027
Placer Pacific Ltd. 1,500,000 4,188,547
Renison Goldfields Consolidated 500,000 1,900,359
Ross Offshore Co. 2,000,000 1,489,261
Zapopan NL(1) 500,000 814,440
-----------
16,915,218
</TABLE>
6 Oppenheimer Gold & Special Minerals Fund
<PAGE> 7
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
------ ------------
<S> <C> <C> <C>
GOLD MINING: CANADA--21.0% American Barrick Resources Corp. 200,000 $4,450,000
Cambior, Inc. 200,000 2,299,162
Dayton Mining Corp.(1) 100,000 292,298
Dayton Mining Corp., Units(1) 300,000 882,238
Glamis Gold Ltd. 300,000 2,646,710
Golden Star Resources Ltd.(1) 150,000 1,283,253
Hemlo Gold Mines, Inc. 500,000 5,124,101
Kinross Gold(1) 200,000 1,033,732
Minera Rayrock, Inc., Cl. A(1) 340,000 630,220
Monarch Resources(1)(2) 300,000 727,177
Pegasus Gold, Inc. 250,000 2,843,750
Placer Dome, Inc. 310,000 6,742,500
Prime Resource Group, Inc.(1) 175,000 1,263,202
Rayrock Yellowknife Resources, Inc.(1)(2) 30,000 355,568
Rayrock Yellowknife Resources, Inc.(1) 103,000 1,220,784
Royalstar Resources Ltd.(1) 361,000 167,286
Teck Corp., Cl. B Sub. Vtg. 150,000 2,713,546
TVX Gold, Inc.(1)(2) 425,000 2,817,674
----------
37,493,201
GOLD MINING: Anglo American Corp. of South Africa Ltd., ADR 75,000 4,293,750
SOUTH AFRICA--14.8% Ashanti Goldfields(1)(2) 150,000 3,262,500
Driefontein Consolidated Ltd., Sponsored ADR 300,000 4,537,500
Free State Consolidated Gold Mines Ltd., ADR 275,000 4,228,125
Hartebeestfontein Gold Mining Co. 350,000 1,588,930
Randfontein Estates Gold Mining, ADR 250,000 2,852,725
Southvaal Holdings Ltd., ADR 70,000 2,018,380
Vaal Reefs Exploration & Mining Co. Ltd., ADR 400,000 3,625,000
----------
26,406,910
</TABLE>
7 Oppenheimer Gold & Special Minerals Fund
<PAGE> 8
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
------ ------------
<S> <C> <C> <C>
GOLD MINING: Battle Mountain Gold Co., Cl. A 200,000 $ 2,200,000
UNITED STATES--8.8% Crown Resources Corp.(1) 400,000 1,650,000
Hecla Mining Co.(1) 100,000 1,012,500
Homestake Mining Co. 150,000 2,568,750
Newmont Gold Co. 50,000 1,781,250
Newmont Mining Corp. 137,291 4,942,476
Santa Fe Pacific Gold Corp.(1) 125,000 1,609,375
-----------
15,764,351
GOLD RELATED Cambiex Exploration, Inc.(1)(3) 1,500,000 588,158
INVESTMENT--6.9% Canarc Resources Corp.(1) 282,500 704,891
Canarc Resources Corp.(1)(2) 450,000 1,122,835
Euro-Nevada Mining Corp. Ltd. 253,300 5,327,176
Franco-Nevada Mining Ltd. 70,000 3,437,158
Normandy Poseidon Ltd. 750,000 1,093,676
-----------
12,273,894
PLATINUM MINING--4.0% Rustenburg Platinum Holdings Ltd., ADR 200,000 5,496,860
Stillwater Mining Co.(1) 125,000 1,703,125
-----------
7,199,985
METAL: MISCELLANEOUS--16.8%
ALUMINUM--0.7% Alcan Australia LTD.(1) 500,000 1,163,486
COPPER--4.6% Aur Resources(1) 428,000 1,327,311
Freeport-McMoRan Copper & Gold, Inc., Cl. A 204,455 4,344,669
Metak Mining Corp.(1)(2) 125,000 1,069,378
Zambia Consolidated Copper Mines B Ltd.(1) 500,000 1,470,630
-----------
8,211,988
METALS: DIVERSIFIED--5.8% Brush Wellman, Inc. 70,000 1,216,250
Elkem AS(1) 150,000 1,940,405
Falconbridge(1)(2) 150,000 2,619,975
Freeport-McMoRan, Inc. 50,000 887,500
Trelleborg AB, Series B Free Shares(1) 100,000 1,459,497
Western Mining Corp. Holdings Ltd. 384,988 2,233,667
-----------
10,357,294
</TABLE>
8 Oppenheimer Gold & Special Minerals Fund
<PAGE> 9
<TABLE>
<CAPTION>
MARKET VALUE
SHARES SEE NOTE 1
------ ------------
<S> <C> <C> <C>
METALS: MISCELLANEOUS--2.7% Korea Zinc Co.(1) 40,000 $ 1,151,553
NV Union Miniere SA(1) 25,000 1,939,991
Pasminco Ltd.(1) 1,200,000 1,675,419
------------
4,766,963
NICKEL--3.0% Eramet SA(1)(2) 38,500 2,488,859
Inco Ltd. 40,000 1,145,000
QNI Ltd.(1) 1,000,000 1,628,879
------------
5,262,738
INDUSTRIAL--2.8%
MACHINERY: Svedala Ind AB Free 125,000 2,908,905
DIVERSIFIED--2.8% Tampella AB(1) 724,333 2,139,591
------------
5,048,496
------------
Total Common Stocks (Cost $132,847,330) 159,433,017
PREFERRED STOCKS--2.1%
Battle Mountain Gold Co., Cv. 34,500 2,104,500
Cyprus Amax Minerals Co., $4.00 Cv., Series A 26,666 1,556,628
------------
Total Preferred Stocks (Cost $3,304,603) 3,661,128
</TABLE>
<TABLE>
<CAPTION>
UNITS
-----
<S> <C> <C>
RIGHTS, WARRANTS AND CERTIFICATES--0.2%
Ashton Mining of Canada, Inc. Wts., Exp. 10/95 100,000 2,852
Cambiex Exploration, Inc. Wts., Exp. 12/95 750,000 96,244
Hindalco Industries Ltd. Wts., Exp. 2/95(2) 10,000 185,000
Lynas Gold NL Wts., Exp. 6/99 1,200,000 102,387
Minera Rayrock, Inc. Wts., Exp. 6/95 170,000 12,120
Total Rights, Warrants and Certificates ------------
(Cost $319,214) 398,603
TOTAL INVESTMENTS, AT VALUE (COST $150,431,673) 99.7% 177,730,748
OTHER ASSETS NET OF LIABILITIES 0.3 548,396
--------- ------------
NET ASSETS 100.0% $178,279,144
========= ============
</TABLE>
1. Non-income producing security.
2. Restricted security--See Note 5 of Notes to
Financial Statements.
3. 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
period ended December 31, 1994. The aggregate
fair value of all securities of affiliated
companies as of December 31, 1994 amounted to
$588,158. Transactions during the period in which
the issuer was an affiliate are as follows:
<TABLE>
<CAPTION>
BALANCE BALANCE
JUNE 30, 1994 GROSS ADDITIONS GROSS REDUCTIONS DECEMBER 31, 1994
------------------- ---------------------- ------------------- ------------------- DIVIDEND
SHARES COST SHARES COST SHARES COST SHARES COST INCOME
------ ---- ------ ---- ------ ---- ------ ---- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Cambiex Exploration, Inc. -- $ -- 1,500,000 $112,921 -- $ -- 1,500,000 $112,921 $ --
</TABLE>
See accompanying Notes to Financial Statements.
9 Oppenheimer Gold & Special Minerals Fund
<PAGE> 10
STATEMENT OF ASSETS AND LIABILITIES December 31,
1994 (Unaudited)
<TABLE>
<S> <C> <C>
ASSETS Investments, at value (cost $150,431,673)--see accompanying statement $177,730,748
Unrealized appreciation on forward foreign currency exchange contracts--Note 6 87
Receivables:
Shares of beneficial interest sold 2,385,108
Interest and dividends 383,934
Investments sold 52,610
Other 43,538
------------
Total assets 180,596,025
LIABILITIES Bank overdraft 276,616
Payables and other liabilities:
Shares of beneficial interest redeemed 1,789,784
Service plan fees--Note 4 96,613
Dividends 24,221
Other 129,647
------------
Total liabilities 2,316,881
NET ASSETS $178,279,144
============
COMPOSITION OF Paid-in capital $163,015,461
NET ASSETS Undistributed (overdistributed) net investment income 222,621
Accumulated net realized gain (loss) from investment transactions (12,257,955)
Net unrealized appreciation (depreciation) on investments and
translation of assets
and liabilities denominated in foreign currencies 27,299,017
------------
Net assets--applicable to 13,360,879 shares of beneficial interest outstanding $178,279,144
============
NET ASSET VALUE AND REDEMPTION PRICE PER SHARE $13.34
MAXIMUM OFFERING PRICE PER SHARE (NET ASSET VALUE PLUS SALES CHARGE OF 5.75% OF OFFERING PRICE) $14.15
</TABLE>
See accompanying Notes to Financial Statements.
10 Oppenheimer Gold & Special Minerals Fund
<PAGE> 11
STATEMENT OF OPERATIONS For the Six Months Ended
December 31, 1994 (Unaudited)
<TABLE>
<S> <C> <C>
INVESTMENT INCOME Dividends (net of withholding taxes of $52,935) $1,147,954
Interest 380,831
----------
Total income 1,528,785
EXPENSES Management fees--Note 4 714,284
Service plan fees--Note 4 191,936
Shareholder reports 99,655
Custodian fees and expenses 55,715
Transfer and shareholder servicing agent fees--Note 4 32,901
Trustees' fees and expenses 14,328
Legal and auditing fees 8,009
Other 104,370
----------
Total expenses 1,221,198
NET INVESTMENT INCOME (LOSS) 307,587
REALIZED AND UNREALIZED GAIN Net realized gain (loss) on:
(LOSS) ON INVESTMENTS Investments 2,560,000
AND FOREIGN CURRENCY Foreign currency transactions (689,400)
----------
TRANSACTIONS Net realized gain (loss) 1,870,600
Net change in unrealized appreciation or depreciation on:
Investments (3,158,780)
Translation of assets and liabilities denominated in foreign currencies 2,023,510
----------
Net change (1,135,270)
----------
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 735,330
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS $1,042,917
==========
</TABLE>
See accompanying Notes to Financial Statements.
11 Oppenheimer Gold & Special Minerals Fund
<PAGE> 12
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
DECEMBER 31, JUNE 30,
1994 (UNAUDITED) 1994
---------------- ------------
<S> <C> <C> <C>
OPERATIONS Net investment income (loss) $ 307,587 $ 865,930
Net realized gain (loss) on investments
and foreign currency transactions 1,870,600 15,524,283
Net change in unrealized appreciation or
depreciation on investments
and translation of assets and liabilities
denominated in foreign currencies (1,135,270) (3,609,360)
------------ ------------
Net increase (decrease) in net assets
resulting from operations 1,042,917 12,780,853
DIVIDENDS AND DISTRIBUTIONS TO Dividends from net investment income
SHAREHOLDERS ($.067 and $.059 per share, respectively) (878,719) (776,209)
BENEFICIAL INTEREST Net increase (decrease) in net assets resulting from
TRANSACTIONS beneficial interest transactions--Note 2 (899,912) 8,028,555
NET ASSETS Total increase (decrease) (735,714) 20,033,199
Beginning of period 179,014,858 158,981,659
------------ ------------
End of period (including undistributed net investment income
of $222,621 and $793,753, respectively) $178,279,144 $179,014,858
============ ============
</TABLE>
See accompanying Notes to Financial
Statements.
12 Oppenheimer Gold & Special Minerals Fund
<PAGE> 13
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
DEC. 31, 1994 YEAR ENDED JUNE 30,
(UNAUDITED) 1994 1993
------------- ---- ----
<S> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $13.28 $12.32 $10.68
Income from investment operations:
Net investment income .03 .06 .06
Net realized and unrealized gain
(loss) on investments and foreign
currency transactions .10 .96 1.72
-------- -------- --------
Total income from investment
operations .13 1.02 1.78
Dividends and distributions to shareholders:
Dividends from net investment income (.07) (.06) (.14)
Distributions from net realized gain
on investments and foreign currency
transactions -- -- --
-------- -------- --------
Total dividends and distributions
to shareholders (.07) (.06) (.14)
Net asset value, end of period $13.34 $13.28 $12.32
======== ======== ========
TOTAL RETURN, AT NET ASSET VALUE(1) .97% 8.25% 17.15%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $178,279 $179,015 $158,982
Average net assets (in thousands) $189,019 $175,093 $124,869
Number of shares outstanding at
end of period (in thousands) 13,361 13,478 12,908
Ratios to average net assets:
Net investment income .32%(2) .50% .61%
Expenses 1.28%(2) 1.31% 1.38%
Portfolio turnover rate(3) 13.4% 29.5% 23.9%
</TABLE>
<TABLE>
<CAPTION>
1992 1991 1990
---- ---- ----
<S> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $10.36 $11.65 $12.58
Income from investment operations:
Net investment income .16 .17 .14
Net realized and unrealized gain
(loss) on investments and foreign
currency transactions .35 (1.42) .54
-------- -------- --------
Total income from investment
operations .51 (1.25) .68
Dividends and distributions to shareholders:
Dividends from net investment income (.19) (.04) (.27)
Distributions from net realized gain
on investments and foreign currency
transactions -- -- (1.34)
-------- -------- --------
Total dividends and distributions
to shareholders (.19) (.04) (1.61)
Net asset value, end of period $10.68 $10.36 $11.65
======== ======== ========
TOTAL RETURN, AT NET ASSET VALUE(1) 5.08% (10.71)% 3.10%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $133,345 $150,907 $163,118
Average net assets (in thousands) $137,906 $154,318 $154,079
Number of shares outstanding at
end of period (in thousands) 12,486 14,564 13,999
Ratios to average net assets:
Net investment income 1.25% 1.67% 1.17%
Expenses 1.38% 1.43% 1.37%
Portfolio turnover rate(3) 39.4% 113.3% 82.3%
</TABLE>
1. 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.
2. Annualized.
3. 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 December 31, 1994 were
$26,575,773 and $23,993,770, respectively.
See accompanying Notes to Financial Statements.
13 Oppenheimer Gold & Special Minerals Fund
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1. SIGNIFICANT Oppenheimer Gold & Special Minerals Fund (the Fund) is
ACCOUNTING registered under the Investment Company Act of 1940, as
POLICIES amended, as a diversified, open-end management investment
company. The Fund's investment advisor is Oppenheimer
Management Corporation (the Manager). 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 Trustees. Long-term debt securities which cannot
be valued by the approved portfolio pricing service are
valued using dealer-supplied valuations provided the
Manager is satisfied that the firm rendering the quotes
is reliable and that the quotes reflect current market
value, or under consistently applied procedures
established by the Board of Trustees to determine fair
value in good faith. 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.
Forward foreign currency contracts are valued at the
closing price on the London foreign exchange market on a
daily basis. Options are valued based upon the last sale
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
rates of exchange prevailing on the respective dates of
such transactions.
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. The market value of
the underlying securities is required to be at least 102%
of the resale price at the time of purchase. 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.
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. At December 31, 1994, the Fund
had available for federal income tax purposes an unused
capital loss carryover of approximately $13,800,000,
$10,600,000 of which will expire in 2000, and $3,200,000
in 2001.
TRUSTEES' FEES AND EXPENSES. The Fund has adopted a
nonfunded retirement plan for the Fund's independent
trustees. Benefits are based on years of service and fees
paid to each trustee during the years of service. The
accumulated liability for the Fund's projected benefit
obligations was $64,708 at December 31, 1994. No payments
have been made under the plan.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends and
distributions to shareholders are recorded on the
ex-dividend date.
14 Oppenheimer Gold & Special Minerals Fund
<PAGE> 15
1. SIGNIFICANT CHANGE IN ACCOUNTING CLASSIFICATION OF DISTRIBUTIONS TO
ACCOUNTING SHAREHOLDERS. Net investment income (loss) and net
POLICIES realized gain (loss) may differ for financial statement
(CONTINUED) and tax purposes primarily because of the recognition of
certain foreign currency gains (losses) as ordinary
income (loss) for tax purposes. The character of the
distributions made during the year from net investment
income or net realized gains may differ from their
ultimate characterization for federal income tax
purposes. Also, due to timing of dividend distributions,
the fiscal year in which amounts are distributed may
differ from the year that the income or realized gain
(loss) was recorded by the Fund. Effective July 1, 1993,
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 June 30, 1993,
amounts have been reclassified to reflect an increase in
paid-in capital of $2,749, a decrease in undistributed
net investment income of $81,980 and an increase in
accumulated net realized gain on investments of $79,231.
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 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 The Fund has authorized an unlimited number of no par
BENEFICIAL value shares of beneficial interest. Transactions in
INTEREST shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED DECEMBER 31, 1994 YEAR ENDED JUNE 30, 1994
---------------------------------- ------------------------
SHARES AMOUNT SHARES AMOUNT
------ ------ ------ ------
<S> <C> <C> <C> <C>
Sold 8,636,844 $120,954,085 16,319,300 $218,789,343
Dividends reinvested 60,149 779,533 48,817 596,985
Redeemed (8,814,500) (122,633,530) (15,798,058) (211,357,773)
---------- ------------ ----------- ------------
Net increase (decrease) (117,507) $ (899,912) 570,059 $ 8,028,555
========== ============ =========== ============
</TABLE>
3. UNREALIZED GAINS At December 31, 1994, net unrealized appreciation on
AND LOSSES investments of $27,299,162 was composed of gross
ON INVESTMENTS appreciation of $35,947,100, and gross depreciation of
$8,647,938.
4. MANAGEMENT FEES Management fees paid to the Manager were in accordance
AND OTHER with the investment advisory agreement with the Fund
TRANSACTIONS which provides for an annual fee of .75% on the first
WITH AFFILIATES $200 million of net assets, .72% on the next $200
million, .69% on the next $200 million, .66% on the next
$200 million and .60% on net assets in excess of $800
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 December 31, 1994,
commissions (sales charges paid by investors) on sales of
Fund shares totaled $464,296, of which $105,107 was
retained by Oppenheimer Funds Distributor, Inc. (OFDI), a
subsidiary of the Manager, as general distributor, and by
an affiliated broker/dealer.
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 an approved service plan, the Fund 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 April 1, 1991),
including amounts paid to brokers, dealers, banks and
other financial institutions. During the six months ended
December 31, 1994, OFDI paid $3,489 to an affiliated
broker/dealer as reimbursement for personal service and
maintenance expenses.
15 Oppenheimer Gold & Special Minerals Fund
<PAGE> 16
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
5. RESTRICTED The Fund owns securities purchased in private placement
SECURITIES transactions, without registration under the Securities
Act of 1933 (the Act). The securities are valued under
methods approved by the Board of Trustees 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 Trustees or
by the Manager under Board-approved guidelines.
Restricted and illiquid securities, excluding securities
eligible for resale pursuant to Rule 144A of the Act
amount to $3,940,509 or 2.21% of the Fund's net assets,
at December 31, 1994. Illiquid and/or restricted
securities, including those restricted securities that
are transferable under Rule 144A of the Act are listed
below.
<TABLE>
<CAPTION>
VALUATION PER UNIT AS OF
SECURITY ACQUISITION DATE COST PER UNIT DECEMBER 31, 1994
-------- ---------------- ------------- ------------------------
<S> <C> <C> <C>
Ashanti Goldfields(1) 4/20/94 $20.00 $21.75
Canarc Resources Corp. 6/14/94 $ 2.15 $ 2.50
Eramet SA(1) 7/14/94--9/30/94 $52.75 $64.65
Falconbridge(1) 6/13/94 $13.47 $17.47
Hindalco Industries Ltd.
Wts., Exp. 2/95(1) 7/08/94 $ 5.94 $18.50
Metak Mining Corp.(1) 8/13/94 $ 8.38 $ 8.56
Monarch Resources(1) 6/06/94 $ 3.25 $ 2.42
Rayrock Yellowknife Resources,
Inc.(1) 6/02/94 $13.00 $11.85
TVX Gold Inc. 6/28/93--10/20/93 $ 5.68 $ 6.63
</TABLE>
1. Transferable under Rule 144A of the Act.
6. FORWARD CONTRACTS A forward foreign currency exchange contract (forward
contract) is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate.
The Fund uses forward contracts to seek to manage
foreign currency risks. They may also be used to
tactically shift portfolio currency risk. The Fund
generally enters into forward contracts as a hedge upon
the purchase or sale of a security denominated in a
foreign currency. In addition, the Fund may enter into
such contracts as a hedge against changes in foreign
currency exchange rates on portfolio positions.
Forward contracts are valued at the closing price
on the London foreign exchange market on a daily basis.
The Fund will realize a gain or loss upon the closing or
settlement of the forward transaction.
Gains and losses on outstanding contracts
(unrealized appreciation or depreciation on forward
contracts) are reported in the Statement of Assets and
Liabilities. Realized gains and losses are reported with
all other foreign currency gains and losses in the Fund's
results of operations.
Risks include the potential inability of the
counterparty to meet the terms of the contract and
unanticipated movements in the value of a foreign
currency relative to the U.S. dollar. At December 31,
1994, the Fund had outstanding forward contracts to sell
foreign currencies as follows:
<TABLE>
<CAPTION>
UNREALIZED
EXPIRATION CONTRACT VALUATION AS OF APPRECIATION
CONTRACTS TO SELL DATE AMOUNT DECEMBER 31, 1994 (DEPRECIATION)
----------------- ---------- -------- ----------------- --------------
<S> <C> <C> <C> <C>
Canadian Dollar 1/3/95 $43,906 $43,834 $72
Canadian Dollar 1/4/95 8,791 8,776 15
------- ------- ---
$52,697 $52,610 $87
======= ======= ===
</TABLE>
16 Oppenheimer Gold & Special Minerals Fund
<PAGE> 17
OPPENHEIMER GOLD & SPECIAL MINERALS FUND
OFFICERS AND TRUSTEES Leon Levy, Chairman of the Board of Trustees
Leo Cherne, Trustee
Robert G. Galli, Trustee
Benjamin Lipstein, Trustee
Elizabeth B. Moynihan, Trustee
Kenneth A. Randall, Trustee
Edward V. Regan, Trustee
Russell S. Reynolds, Jr., Trustee
Sidney M. Robbins, Trustee
Donald W. Spiro, Trustee and President
Pauline Trigere, Trustee
Clayton K. Yeutter, Trustee
James Ayer, Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
INVESTMENT ADVISOR Oppenheimer Management Corporation
DISTRIBUTOR Oppenheimer Funds Distributor, Inc.
TRANSFER AND Oppenheimer Shareholder Services
SHAREHOLDER
SERVICING AGENT
CUSTODIAN OF The Bank of New York
PORTFOLIO SECURITIES
INDEPENDENT AUDITORS KPMG Peat Marwick LLP
LEGAL COUNSEL Gordon Altman Butowsky Weitzen Shalov & Wein
The financial statements included herein have been taken
from the records of the Fund without examination by the
independent auditors.
This is a copy of a report to shareholders of Oppenheimer
Gold & Special Minerals Fund. This report must be
preceded or accompanied by a Prospectus of Oppenheimer
Gold & Special Minerals Fund. For material information
concerning the Fund, see the Prospectus.
17 Oppenheimer Gold & Special Minerals Fund
<PAGE> 18
OPPENHEIMERFUNDS FAMILY
OppenheimerFunds offers over 35 funds designed to
fit virtually every investment goal. Whether
you're investing for retirement, your children's
education or tax-free income, we have the funds
to help you seek your objective.
When you invest with OppenheimerFunds, you
can feel comfortable knowing that you are
investing with a respected financial institution
with over 30 years of experience in helping
people just like you reach their financial goals.
And you're investing with a leader in global,
growth stock and flexible fixed income
investments--with over 1.8 million shareholder
accounts and more than $29 billion under
Oppenheimer's management and that of our
affiliates.
As an OppenheimerFunds shareholder, you can
easily exchange shares of eligible funds of the
same class by mail or by telephone for a small
administrative fee(1). For more information on
OppenheimerFunds, please contact your financial
advisor or call us at 1-800-525-7048 for a
prospectus. You may also write us at the address
shown on the back cover. As always, please read
the prospectus carefully before you invest.
<TABLE>
<S> <C> <C>
STOCK FUNDS Discovery Fund Global Fund
Global Emerging Growth Fund(2) Oppenheimer Fund
Time Fund Value Stock Fund
Target Fund Gold &Special Minerals Fund
Growth Fund(3)
STOCK & BOND FUNDS Main Street Income &Growth Fund Equity Income Fund
Total Return Fund Asset Allocation Fund
Global Growth &Income Fund
BOND FUNDS High Yield Fund Strategic Short-Term Income Fund
ChampionHigh Yield Fund Investment Grade Bond Fund
Strategic Income &Growth Fund Mortgage Income Fund
Strategic Income Fund U.S. Government Trust
Strategic Diversified Income Fund Limited-Term Government Fund
Strategic Investment Grade Bond Fund
TAX-EXEMPT FUNDS New York Tax-Exempt Fund(4) New Jersey Tax-Exempt Fund(4)
California Tax-Exempt Fund(4) Tax-Free Bond Fund
Pennsylvania Tax-Exempt Fund(4) Insured Tax-Exempt Bond Fund
Florida Tax-Exempt Fund4 Intermediate Tax-Exempt Bond Fund
MONEY MARKET FUNDS Money Market Fund Cash Reserves
</TABLE>
1. The fee is waived for PhoneLink exchanges
between existing accounts. Exchange privileges
are subject to change or termination.
2. Formerly Oppenheimer Global Bio-Tech Fund and
Oppenheimer Global Environment Fund.
3. Formerly Special Fund.
4. Available only to residents of those states.
OppenheimerFunds are distributed by Oppenheimer
Funds Distributor, Inc., Two World Trade Center,
New York, NY10048-0203.
(C) Copyright 1995 Oppenheimer Management
Corporation. All rights reserved.
18 Oppenheimer Gold & Special Minerals Fund
<PAGE> 19
[FIGURE NUMBER 7]
Vision of man sitting at side of swimming pool
<PAGE> 20
"How may I help you?"
As an OppenheimerFunds shareholder, some special privileges are available to
you. Whether it's automatic investment plans, informative newsletters and
hotlines, or ready account access, you can benefit from services designed to
make investing simple.
And when you need help, our Customer Service Representatives are only a
toll-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling our
toll-free Telephone Transactions number. And, by enrolling in AccountLink, a
convenient service that "links" your OppenheimerFunds accounts and your bank
checking or savings account, you can use the Telephone Transactions number to
make investments.
For added convenience, you can get auto-mated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. It also gives you the ability to make transactions using your
touch-tone phone. Of course, you can always speak with a Customer Service
Representative during business hours.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an indepen-dent, non-profit
organization made up of over 3,200 customer service management professionals
from around the country, hon-ored the OppenheimerFunds' transfer agent,
Oppenheimer Shareholder Services, with their Award of Excellence in 1993.
So call us today--we're here to help.
[FIGURE NUMBER 8]
Photo of Jennifer Leonard
Jennifer Leonard, Customer Service Representative
Oppenheimer Shareholder Services
INFORMATION
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Saturday 10 a.m.-2 p.m. ET
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