<PAGE>
SEMI-ANNUAL REPORT
JANUARY 31, 2000
DAVIS NEW YORK
VENTURE FUND
[DAVIS FUNDS LOGO]
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
Dear Fellow Shareholder,
As we enter the new millennium, we must recognize that the market has come a
long way and is starting from a high base. We are unlikely to continue enjoying
the twin benefits of steeply falling interest rates and rising corporate profits
as a percentage of gross domestic product that propelled stock prices and
price/earnings ratios sharply higher in the last two decades or so of the 20th
century. Corporate profits have been inflated by various accounting practices.
In addition, while the Internet holds great possibilities for many businesses,
it is disrupting profitability for others.
Throughout modern times, we have seen the development of different networks that
linked people and businesses together and changed history. Examples include the
railroad, automobile/highway, electricity, air travel and telephone networks.
Today, the Internet is transforming the world through an electronic network that
transmits video, voice and data at ever-increasing speeds and ever-reducing
costs.
For many companies, the "net net" conclusion is that they must convert their
businesses to e-businesses or they will have no business. As a result, the
Internet revolution, like other revolutions before it, has spawned enormous
investment spending--creating a high degree of optimism and speculation, perhaps
even a financial bubble. Yet this speculation has also facilitated the raising
of low-cost capital and given the United States a first-mover advantage in
developing the Internet and driving it forward.
A recession or high interest rates would reduce the availability of capital and
spending on the Internet. We think policymakers have been willing to live with
some froth in the market because they believe the good of the Internet outweighs
the bad. The Internet should have a huge positive impact on productivity and
cost structures, and maintaining our leadership position is worth the risk of
not taking actions that could lead to recession. Continued investment in the
Internet is necessary for the good of the country and our competitive health.
At the same time, many business models will have to change and there definitely
will be losers as well as winners, as there have always been with any
technological advance. For example, as more business is done directly via the
Internet, middleman industries like distributors are particularly vulnerable.
Many established companies are going to have to provide greater value-added with
their services or their customers will turn to the Internet. The impact of these
businesses modernizing and taking restructuring charges will not necessarily be
bullish for corporate profits in the early stages.
Moreover, it is impossible to predict which of the new dot.com companies will
thrive or even survive over time. When you look at other industries that
transformed the country like autos and airplanes, you see that most of the
pioneering companies in those industries are no longer in business today.
We think we may be closing another chapter in the market's history and facing a
future that does not hold as many favorable macro factors. The Internet is both
a driver and a destroyer. Companies old and new are caught up in a Darwinian
struggle, trying to anticipate which business models will work and which will
not work. Hopefully, this will be a process of creative destruction and the
economy overall will emerge the better for it. But struggles are not necessarily
good for corporate profits, and we don't think it will be as easy--if, indeed,
it has ever been easy--to make money in stocks. As a result, stock selection
will be more crucial than ever.
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
Because we are in a time of ferment and change, we think a premium will be paid
for company managements that "get it" and invest their shareholders' money
correctly to position the company for the future. In addition, with the U.S.
market unlikely to enjoy the big tailwind of expanding P/E ratios that it did
over the past 15 or 20 years, we think having a global perspective may be
increasingly important. Multinational companies have an advantage in that they
can allocate their capital around the world to areas where GDP growth is
expected to be the fastest.
Some foreign economies such as Germany and Japan appear to be behind us in their
evolution, and they may offer greater opportunities as more and more of their
businesses streamline and restructure. On the other hand, the United States is a
moving target, and it will not be easy for other countries to catch us because
we are driving our Internet development so rapidly.
If the Dow were to increase at the same pace over the next two decades as it did
over the past two, it would stand at roughly 100,000 in 2020. We are certain
that will not happen. However, if the Dow were to compound at a rate of 7% or 8%
a year, it could reach 40,000 or 50,000 over that time frame--meaning the market
still offers considerable opportunities for long-term wealth building.(1) As
always, we will focus on buying growing companies at reasonable prices that are
led by management teams who respond dynamically to change. We are on a long
voyage with our shareholders and our money is invested shoulder-to-shoulder with
theirs. We are not overly optimistic. We are not pessimistic. We are trying to
be realistic.
Sincerely,
/s/ Shelby M.C. Davis
Shelby M.C. Davis
Senior Research Adviser
March 16, 2000
2
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
MANAGEMENT'S DISCUSSION AND ANALYSIS
PERFORMANCE OVERVIEW
o The Davis New York Venture Fund's Class A shares delivered a total return on
net asset value of 14.55% for the one-year period ended January 31, 2000(2)
compared with a return of 10.29%for the S&P 500 Index.(3)
o The Fund is the only fund now open to new investors that has consistently
outperformed the S&P 500 over all 10-year periods (calendar years) since the
Fund's inception on February 17, 1969.(4) The Fund's Class A shares have
generated an average annual total return of 15.04% since inception versus a
return of 12.78% for the S&P 500 over the same time frame.
AN INTERVIEW WITH CHRISTOPHER C. DAVIS AND KENNETH CHARLES FEINBERG, PORTFOLIO
MANAGERS
Q. How would you describe the performance of the Fund in 1999?
A. Investors often speak of stock market performance in terms of breadth or
narrowness. By this they are describing whether a move in the market was enjoyed
by a broad range of companies or by only a select few. Like 1998, 1999 was a
year of extraordinary narrowness in the market. The handsome gains enjoyed by
the S&P 500 Index were produced by the exceptionally strong performance of a
very few stocks. The vast majority of stocks posted weak performance.
Market observers know 1999 was a year of extraordinary performance in the
technology sector. While many of the gains in this sector were reaped by
companies with virtually no earnings and no clear path to developing significant
earnings, the performance of more old-fashioned technology companies--if that is
not an oxymoron--was also exceptional. Importantly, the shares of technology
companies that the Fund owns--such as IBM, Hewlett-Packard and Texas
Instruments(5)--did not just reflect changes in psychology or a new-era mania,
but instead reflected substantial gains in their core businesses.
Corporate customers continue to flock to IBM to seek advice and solutions for
addressing the Internet. Hewlett-Packard's wonderful printing business continues
to benefit from the rise of e-mail and digital photography. Texas Instruments,
the Fund's star performer of the year, is beginning to reap the rewards of its
prescient commitment to the world of digital signal processors--a fancy word for
describing the computer chips that lie at the heart of everything from cellular
phones and digital cameras to new generation automobiles.
Q. What about the performance of financial stocks in 1999?
A. Most market observers would describe 1999 as a terrible year for financial
stocks. The PHLX/KBW Bank Index3, for example, fell 2.12% in 1999 while the
threat of increasing interest rates spooked investors throughout the sector.
Although the Fund owns a number of financial stocks whose value declined and
whose earnings outlook deteriorated somewhat last year, it is notable that four
of our largest holdings in the financial area achieved exceptional gains,
handily outperforming the S&P 500.
American Express, the Fund's largest holding, rose more than 60%, perhaps
reflecting the fact that the Internet does not accept cash. Two other large
holdings in the financial sector--Citigroup and Morgan Stanley Dean
Witter--remain great beneficiaries of worldwide privatization, the globalization
of trade and finance, unprecedented mergers and acquisitions activity, and
strong capital markets. We continue to think that these companies are two of
only a handful of American powerhouses that make up a global oligopoly in the
investment banking business. Finally, international powerhouse, American
International Group, advanced almost 40%. AIG enjoyed a remarkable expansion in
its price/earnings (P/E) ratio to almost unprecedented levels. Despite this
dramatic appreciation, this outstanding international growth company still
trades at only a slight premium to the valuation of the S&P Index.
3
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
AN INTERVIEW WITH CHRISTOPHER C. DAVIS AND KENNETH CHARLES FEINBERG, PORTFOLIO
MANAGERS - CONTINUED
Q. What holdings performed unsatisfactorily last year?
A. As always, the Fund owned some companies whose stocks performed poorly. Among
these were Wells Fargo, Berkshire Hathaway, McDonald's, Household International,
and Martin Marietta Materials. Significantly, the poor performance of these
stocks was not a reflection of poor performance in their underlying businesses.
It is important to distinguish these types of stocks from stocks where poor
returns reflected a substantial decline in the operating performance of those
businesses. It is this latter group that Ken and I categorize as mistakes, and
we certainly had our share of these in 1999.
Chief among these mistakes must be our mis-assessment of Waste Management. While
the Fund's holdings in this company were never among our largest, it was
certainly our largest mistake. It now appears that the company's financial
statements were inaccurate and that senior management knowingly covered up
deteriorating operating results. Ken and I feel we were slow to pick up on the
warning signs of weakening operations and strained financials.
To this list, we must also add Philip Morris, where we failed to anticipate
material setbacks for the company in the legal arena. In analyzing our holding
in Progressive Corp., still one of the best companies in the auto insurance
business, we were slow to recognize the huge impact that greater price
competition would have on earnings. In the case of another insurer,
UnumProvident, we were mistaken in our assessment of the profitability of the
company's core business.
Nevertheless, we know that we are in a batting average business, and we must be
willing to swing at the ball to improve. But we must also remember that the only
value of mistakes lies in the lessons that we learn from them. As my grandfather
Shelby Cullom Davis once said, "If you do not admit you make mistakes, you do
not learn from them."
Q. What is your outlook going forward?
A. In his commentary at the beginning of this semiannual report, my father
Shelby M.C. Davis has clearly described the challenges that in all likelihood
lie ahead and the issues on which Ken and I must always remain focused. A wag
once famously said that the four most expensive words on Wall Street are, "This
time is different." But clearly as we look out at this new economy, some things
are different. Venerable companies with stable businesses are under attack from
this new juggernaut called the Internet. Business plans that once could have
been carved in stone must be completely reassessed.
In addition to these changes in technology, other powerful forces are at work
creating an environment of uncertainty. For example, investors have been lulled
into a sense of complacency by the seemingly routine predictability of quarterly
earnings gains that may have been more the result of elastic accounting than a
true reflection of the underlying businesses. In many industries there is also
the specter of increased government regulation, from price controls in the
pharmaceutical industry to regulatory intervention in the development of the
broadband Internet.
4
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
AN INTERVIEW WITH CHRISTOPHER C. DAVIS AND KENNETH CHARLES FEINBERG, PORTFOLIO
MANAGERS - CONTINUED
Finally, without making economic predictions, we must always remember that the
level of interest rates plays a vital role in our evaluation of companies for
one simple reason: no company is worth more or less than the present value of
its future cash flows. In determining that present value, one must do two
things: first, make predictions about the future cash flows generated by the
business in question and, second, discount those cash flows to the present using
an interest rate that reflects the available risk-free alternatives. The higher
this interest rate, the lower the present value of those future earnings streams
and, therefore, the lower the valuation for the stock in question. Warren
Buffett once said that interest rates act like gravity in the financial markets.
Higher rates would certainly weigh down stock valuations.
I would like to end with an interesting quotation from an interview given by my
father that appeared in Business Week magazine. In it he says, we guarantee that
we "will never be number one in a roaring speculative bull market. [We] eschew
the go-go philosophy that made instant winners [last year] of funds that favored
letter stock, new issues and hotshot over-the-counter securities." What makes
this observation so interesting is that it appeared in the February 7th issue of
Business Week in the year 1970, not long before the onset of the worst bear
market since the depression.
But lest we become too pessimistic, it is notable that in the same interview my
father states, "In a bull market, all you need is a great stock. In a bear
market, you need a great company." Ken and I feel that in Davis New York Venture
Fund we own many great companies run by great executives. While we think that
the next five years may be difficult ones for the overall market, we believe
that, at today's prices, the valuations for the companies we own are not
excessive and that patient, long-term investors will be rewarded for riding
through the inevitable financial storms that are likely to follow the smooth
sailing of the last decade.(6)
- -------------------
This Semi-Annual Report is authorized for distribution only when accompanied or
preceded by a current prospectus of Davis New York Venture Fund containing more
information about risks, fees and expenses. Please read the prospectus carefully
before investing or sending money.
(1) This hypothetical example illustrates the power of compounding over a
20-year period and is not intended to be indicative of future investment results
which may be higher or lower than the assumed rate.
5
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
(2) Total return assumes reinvestment of dividends and capital gain
distributions. Past performance is not a guarantee of future results. Investment
return and principal value will vary so that, when redeemed, an investor's
shares may be worth more or less than they were when they were purchased. Below
are the average annual total returns for Davis New York Venture Fund's Class A
shares for periods ending January 31, 2000. Returns for other classes of shares
will vary from the following returns:
* (WITHOUT a 4.75% sales charge taken into consideration)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------
FUND NAME 1 YEAR 5 YEAR 10 YEAR INCEPTION
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York Venture A 14.55% 25.11% 19.49% 15.04%-02/17/69
- ------------------------------------------------------------------------------------------------------------------
* (WITH a 4.75% sales charge taken into consideration)
- ------------------------------------------------------------------------------------------------------------------
FUND NAME 1 YEAR 5 YEAR 10 YEAR INCEPTION
- ------------------------------------------------------------------------------------------------------------------
New York Venture A 9.09% 23.88% 18.90% 14.86%-02/17/69
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
(3) The definitions of indices quoted in this newsletter appear below.
Investments cannot be made directly in either of these indices.
I. The S&P 500 Index is an unmanaged index of 500 selected common stocks,
most of which are listed on the New York Stock Exchange. The index is
adjusted for dividends, weighted towards stocks with large market
capitalizations, and represents approximately two-thirds of the total
market value of all domestic common stocks.
II. The PHLX/KBW Bank Index is a capitalization-weighted index consisting
of 24 exchange-listed and National Market System stocks representing
national money center banks and leading regional institutions. The
index is intended to reflect the evolving financial sector and was
developed with a base value of 195 as of 10-21-91.
(4) Past performance is not a guarantee of future results. The Fund's 10-year
average annual total return has surpassed the S&P 500 for all rolling 10-year
time periods since its inception. This example compares the average annual total
return earned by Class A shares of Davis New York Venture Fund against the
return earned by the S&P 500 Index for rolling 10-year time periods ending
December 31st of each year. The Fund's returns assume an investment in Class A
shares on January 1st of each year, with all dividends and capital gain
distributions reinvested for a 10-year period. The figures were not adjusted for
any sales charges which may be imposed. If sales charges were imposed, the
reported figures would be lower.
(5) Portfolio holdings and portfolio manager opinions cited in this material are
current as of the date of this report but are subject to change. See the Fund's
Schedule of Investments for a detailed list of portfolio holdings.
(6) This report reflects the professional opinions of the Fund's portfolio
managers. All investments involve some degree of risk and there can be no
assurance that the Fund's investment strategies will be successful. Prices of
shares will vary and, when redeemed, an investor's shares could be worth more or
less than their original cost.
An investment in the Fund is not a deposit in a bank and is neither insured nor
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency.
6
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments
January 31, 2000 (Unaudited)
============================================================================================================
<CAPTION>
VALUE
SHARES SECURITY (NOTE 1)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK - (96.34%)
ADVERTISING AGENCIES - (0.08%)
880,000 WPP Group PLC....................................................... $ 13,976,078
-----------------
AGRICULTURAL - (0.24%)
1,105,000 Monsanto Co......................................................... 39,020,313
-----------------
BANKS AND SAVINGS & LOANS - (6.61%)
21,374 Bank of America Corp................................................ 1,035,303
30,000 First Union Corp. .................................................. 1,006,875
7,814,700 Golden West Financial Corp.......................................... 230,045,232
785,100 State Street Corp................................................... 62,955,206
2,994,700 U.S. Bancorp........................................................ 66,444,906
17,661,000 Wells Fargo & Co.................................................... 706,440,000
-----------------
1,067,927,522
-----------------
BUILDING MATERIALS - (3.63%)
4,036,700 Martin Marietta Materials, Inc. (b) (c)............................. 169,541,400
11,508,800 Masco Corp.......................................................... 229,456,700
4,419,920 Vulcan Materials Co................................................. 187,017,865
-----------------
586,015,965
-----------------
CHEMICALS - (0.00%)
6,000 Dow Chemical Co..................................................... 699,000
-----------------
CONSULTING SERVICES - (0.00%)
1,302 Gartner Group, Inc. - Class B*...................................... 17,740
-----------------
CONSUMER PRODUCTS - (1.58%)
80,200 Coca-Cola Co........................................................ 4,606,488
1,064,000 Colgate-Palmolive Co.......................................... 63,042,000
30,000 Fortune Brands, Inc................................................. 870,000
30,000 Gallaher Group PLC - ADR............................................ 461,250
1,580,000 Gillette Co......................................................... 59,447,500
6,028,800 Philip Morris Cos., Inc............................................. 126,228,000
-----------------
254,655,238
-----------------
DIVERSIFIED - (5.73%)
8,522 Berkshire Hathaway, Inc. - Class A*................................. 436,326,400
4 Berkshire Hathaway, Inc. - Class B*................................. 6,584
80,240 General Electric Co................................................. 10,702,010
11,182,000 Tyco International Ltd. ............................................ 478,030,500
-----------------
925,065,494
-----------------
DIVERSIFIED FINANCIAL SERVICES - (16.93%)
6,607,000 American Express Co................................................. 1,088,891,188
12,867,162 Citigroup, Inc...................................................... 739,057,617
2,750,600 Freddie Mac (b)..................................................... 138,045,738
14,050,000 Household International, Inc........................................ 495,262,500
3,240,000 Providian Financial Corp............................................ 273,375,000
-----------------
2,734,632,043
-----------------
</TABLE>
7
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
January 31, 2000 (Unaudited)
============================================================================================================
<CAPTION>
VALUE
SHARES SECURITY (NOTE 1)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK - CONTINUED
DIVERSIFIED INSURANCE - (2.22%)
3,452,207 American International Group, Inc................................... $ 359,461,054
-----------------
ELECTRONICS - (4.52%)
400,000 Agilent Technologies, Inc.*......................................... 26,475,000
3,723,600 Applied Materials, Inc.* (b)........................................ 510,947,738
508,024 Koninklijke Philips Electronics N.V................................. 75,060,546
2,313,474 Molex Inc. (b)...................................................... 117,625,694
-----------------
730,108,978
-----------------
ENERGY - (1.16%)
13,200 Amerada Hess Corp. ................................................. 702,075
32,200 Atlantic Richfield Co............................................... 2,479,400
5,000 Burlington Resources, Inc........................................... 160,313
52,200 Chevron Corp........................................................ 4,361,963
2,392,143 Devon Energy Corp................................................... 84,024,023
12,000 Duke Energy Corp.................................................... 693,000
16,000 El Paso Energy Corp................................................. 516,000
181,922 Exxon Corp.......................................................... 15,190,487
1,303,200 Schlumberger Ltd. (b)............................................... 79,576,650
8,000 Sempra Energy....................................................... 148,500
1,548 Transocean Sedco Forex Inc.......................................... 49,246
-----------------
187,901,657
-----------------
FOOD & RESTAURANT - (3.40%)
14,770,800 McDonald's Corp..................................................... 549,289,115
-----------------
HOTELS - (0.77%)
3,991,000 Marriott International, Inc......................................... 123,970,438
-----------------
INDUSTRIAL - (1.28%)
3,677,000 Sealed Air Corp.* (b)............................................... 206,371,625
-----------------
INVESTMENT FIRMS - (3.65%)
3,143,000 Donaldson, Lufkin & Jenrette, Inc................................... 150,274,688
24,000 J.P. Morgan & Co., Inc.............................................. 2,947,500
6,588,380 Morgan Stanley Dean Witter & Co..................................... 436,473,456
-----------------
589,695,644
-----------------
LIFE INSURANCE - (0.47%)
2,842,400 UnumProvident Corp.................................................. 76,034,200
-----------------
MACHINERY - (0.93%)
3,712,600 Dover Corp.......................................................... 149,664,188
-----------------
MANUFACTURING - (0.01%)
30,000 Maytag Corp......................................................... 1,215,000
-----------------
MARKETING - (0.00%)
1,666 ACNielsen Corp.*.................................................... 34,153
-----------------
PAPER PRODUCTS - (0.01%)
36,208 International Paper Co.............................................. 1,724,406
-----------------
</TABLE>
8
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
January 31, 2000 (Unaudited)
==============================================================================================================
<CAPTION>
VALUE
SHARES SECURITY (NOTE 1)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK - CONTINUED
PHARMACEUTICAL AND HEALTH CARE - (5.26%)
8,356,400 American Home Products Corp......................................... $ 393,273,075
2,313,800 Bristol-Myers Squibb Co............................................. 152,710,800
10,000 IMS Health, Inc..................................................... 224,375
40,000 Johnson & Johnson................................................... 3,442,500
889,000 Merck & Co., Inc.................................................... 70,064,313
909,600 Pfizer, Inc......................................................... 33,086,700
3,217,600 SmithKline Beecham PLC - ADR........................................ 196,273,600
-----------------
849,075,363
-----------------
PROPERTY/CASUALTY INSURANCE - (3.04%)
1,616,300 Chubb Corp. (b)..................................................... 90,916,875
2,453,300 Progressive Corp. (Ohio) (b)........................................ 152,717,925
3,309,300 Transatlantic Holdings, Inc. (c).................................... 248,197,500
-----------------
491,832,300
-----------------
PUBLISHING - (1.40%)
748,500 Dow Jones & Co., Inc................................................ 46,407,000
5,000 Dun & Bradstreet Corp.............................................. 125,938
1,628,000 Gannett Co., Inc.................................................... 113,146,000
1,000 R. H. Donnelley Corp................................................ 17,688
1,575,200 Tribune Co.......................................................... 66,453,750
1,000 Washington Post Co., Class B........................................ 550,000
-----------------
226,700,376
-----------------
REAL ESTATE - (1.08%)
356,600 Boardwalk Equities, Inc.*........................................... 2,137,389
372,800 Centerpoint Properties Corp......................................... 13,211,100
1,534,200 Crescent Real Estate Equities Co. (b)............................... 27,615,600
529,300 Equity Residential Properties Trust (b)............................. 21,965,950
2,313,100 General Growth Properties, Inc. (b)................................. 65,923,350
784,000 Mack-Cali Realty Corp............................................... 19,943,000
137,800 Public Storage, Inc................................................. 3,126,338
636,900 Vornado Realty Trust................................................ 19,942,931
-----------------
173,865,658
-----------------
RETAIL - (0.07%)
522,920 The Neiman Marcus Group, Inc., Class B*............................. 11,700,335
-----------------
SATELLITE TELECOMMUNICATIONS - (0.67%)
5,533,400 Loral Space & Communications, Ltd.* (b)............................. 108,592,975
-----------------
TECHNOLOGY - (24.34%)
3,910,000 BMC Software, Inc.* (b)............................................. 147,969,063
8,612,725 Hewlett-Packard Co. (b)............................................. 932,302,481
4,505,400 Intel Corp.......................................................... 445,612,219
5,508,800 International Business Machines Corp................................ 617,993,500
</TABLE>
9
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
January 31, 2000 (Unaudited)
==============================================================================================================
<CAPTION>
VALUE
SHARES/PRINCIPAL SECURITY (NOTE 1)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK - CONTINUED
TECHNOLOGY - CONTINUED
3,399,900 Lexmark International Group, Inc., Class A* (b)..................... $ 320,440,575
5,083,600 Novell, Inc.*....................................................... 169,665,150
5,440,000 Oracle Corp.*....................................................... 271,830,000
1,101,500 SAP AG - ADR (b).................................................... 71,804,031
8,841,000 Texas Instruments Inc. ............................................. 953,722,875
-----------------
3,931,339,894
-----------------
TELECOMMUNICATIONS - (6.90%)
420,000 AT&T Corp........................................................... 22,155,000
2,847,412 Globalstar Telecommunications Ltd.* (b)............................. 93,608,670
3,060,000 Lucent Technologies, Inc. (b)....................................... 169,065,000
1,020,000 MCI WorldCom, Inc.*................................................. 46,824,375
4,982,000 MediaOne Group, Inc.*............................................... 396,069,000
2,466,600 Motorola, Inc....................................................... 337,307,550
20,000 SBC Communications, Inc............................................. 862,500
749,600 Sprint Corp......................................................... 48,489,750
-----------------
1,114,381,845
-----------------
UTILITIES - (0.01%)
10,000 Carolina Power & Light Co........................................... 322,500
12,000 Edison International ............................................... 348,000
6,000 New England Electric System......................................... 317,250
16,800 Southern Co......................................................... 430,500
9,000 Wisconsin Energy Corp. ............................................. 177,750
-----------------
1,596,000
-----------------
WASTE MANAGEMENT - (0.35%)
3,241,500 Waste Management, Inc. (b).......................................... 56,726,250
-----------------
Total Common Stocks - (identified cost $10,592,219,519)........ 15,563,290,847
-----------------
PREFERRED STOCK - (1.21%)
2,000,000 General Growth Properties, 7.25%, Cum. Conv. Pfd.................... 41,250,000
198,800 SAP AG, Pfd. (b).................................................... 152,021,589
60,200 Vornado Realty Trust, 6.50%, Ser. A, Cum. Conv. Pfd................. 2,784,250
-----------------
Total Preferred Stocks - (identified cost $53,013,443)......... 196,055,839
-----------------
SHORT TERM INVESTMENTS - (3.20%)
$ 50,000,000 Fannie Mae Discount Note, 5.53%, 02/07/00........................... 49,953,917
5,000,000 Federal Farm Credit Bank Discount Note, 5.63%, 02/28/00............. 4,978,888
46,000,000 Federal Farm Credit Bank Discount Note, 5.63%, 02/29/00............. 45,798,571
</TABLE>
10
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
January 31, 2000 (Unaudited)
==============================================================================================================
<CAPTION>
VALUE
PRINCIPAL SECURITY (NOTE 1)
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
SHORT TERM INVESTMENTS - CONTINUED
$ 50,000,000 Freddie Mac Discount Note, 5.05%, 02/01/00.......................... $ 50,000,000
50,000,000 Freddie Mac Discount Note, 5.52%, 02/02/00.......................... 49,992,333
30,000,000 Freddie Mac Discount Note, 5.73%, 02/04/00.......................... 29,985,675
29,700,000 Freddie Mac Discount Note, 5.50%, 02/08/00.......................... 29,668,238
17,600,000 Freddie Mac Discount Note, 5.52%, 02/09/00.......................... 17,578,411
30,000,000 Freddie Mac Discount Note, 5.45%, 02/10/00.......................... 29,959,125
11,300,000 Freddie Mac Discount Note, 5.53%, 02/11/00.......................... 11,282,642
50,000,000 Freddie Mac Discount Note, 5.45%, 02/15/00.......................... 49,894,028
50,000,000 Freddie Mac Discount Note, 5.45%, 02/18/00.......................... 49,871,319
97,090,000 State Street Corporation Repurchase Agreement, 5.78%, 02/01/00,
dated 01/31/00, repurchase value $97,105,588 (collateralized by:
$1,166,000 par value Freddie Mac DN, Zero Cpn., 09/12/00,
$49,260,000 par value Federal Home Loan Bank, 5.50%, 01/06/04,
$52,960,000 par value Fannie Mae, 6.00%, 05/15/08,
market value $100,011,800)........................................ 97,090,000
-----------------
Total Short Term Investments - (identified cost $516,053,147).. 516,053,147
-----------------
Total Investments - (identified cost $11,161,286,109)
(100.75%)(a)............................................... 16,275,399,833
Liabilities Less Other Assets - (0.75%)........................ (120,459,883)
-----------------
Net Assets - (100%)................................... $ 16,154,939,950
=================
(a) Aggregate cost for Federal Income Tax purposes is $11,161,258,817 . At
January 31, 2000 unrealized appreciation (depreciation) of securities for
Federal Income Tax purposes was as follows:
Unrealized appreciation............................................. $ 5,730,445,206
Unrealized depreciation............................................. (616,304,190)
-----------------
Net appreciation............................................... $ 5,114,141,016
=================
</TABLE>
(b) Loaned security - See Note 7 of Notes to Financial Statements.
(c) Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer and is an affiliate, as defined in the Investment
Company Act of 1940, at or during the six months ended January 31, 2000. The
aggregate fair value of the securities of affiliated companies held by the Fund
as of January 31, 2000 amounts to $417,738,900. Transactions during the period
in which the issuers were affiliates are as follows:
<TABLE>
<CAPTION>
Shares Gross Gross Shares Dividend
Security July 31, 1999 Additions Reductions January 31, 2000 Income
- -------- ------------- --------- ---------- ---------------- ------
<S> <C> <C> <C> <C> <C>
Harcourt General, Inc. 2,815,300 - 2,815,300 - 591,213
Martin Marietta
Materials, Inc. 4,036,700 - - 4,036,700 1,049,542
Transatlantic
Holdings, Inc. 3,309,300 - - 3,309,300 827,325
</TABLE>
* Non-Income Producing Security
SEE NOTES TO FINANCIAL STATEMENTS
11
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
STATEMENT OF ASSETS AND LIABILITIES
At January 31, 2000 (Unaudited)
==============================================================================================================
<CAPTION>
ASSETS:
<S> <C>
Investments in securities, at value (see accompanying Schedule of Investments)
Unaffiliated companies (identified cost of $10,794,879,097)...................... $ 15,857,660,933
Affiliated companies (identified cost of $366,407,012)........................... 417,738,900
Collateral for securities loaned (Note 7)............................................ 298,072,467
Cash................................................................................. 529,691
Receivables:
Investment securities sold....................................................... 8,255,849
Capital stock sold............................................................... 62,629,789
Dividends and interest........................................................... 6,181,949
Prepaid expenses..................................................................... 75,970
Other assets......................................................................... 946,191
-----------------
Total assets................................................................ 16,652,091,739
-----------------
LIABILITIES:
Return of collateral for securities loaned (Note 7).................................. 298,072,467
Payables:
Investment securities purchased.................................................. 155,596,760
Capital stock redeemed........................................................... 24,873,814
Accrued expenses..................................................................... 18,608,748
-----------------
Total liabilities........................................................... 497,151,789
-----------------
NET ASSETS ............................................................................... $ 16,154,939,950
=================
NET ASSETS CONSIST OF:
Par value of shares of capital stock................................................. $ 28,671,642
Additional paid-in capital........................................................... 11,164,464,708
Deficit in undistributed net investment income....................................... (3,647,950)
Net unrealized appreciation on investments........................................... 5,114,113,724
Accumulated net realized loss from investments and foreign currency transactions..... (148,662,174)
-----------------
Net assets.................................................................. $ 16,154,939,950
=================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
STATEMENT OF ASSETS AND LIABILITIES
At January 31, 2000 (Unaudited)
==============================================================================================================
<CAPTION>
CLASS A SHARES
<S> <C>
Net assets....................................................................... $ 8,109,925,702
Shares outstanding............................................................... 285,381,903
Net asset value and redemption price per share................................... $ 28.42
=========
Maximum offering price per share (100/95.25 of $28.42)*.......................... $ 29.84
=========
CLASS B SHARES
Net assets....................................................................... $ 4,908,954,916
Shares outstanding............................................................... 176,588,425
Net asset value and redemption price per share................................... $ 27.80
=========
CLASS C SHARES
Net assets....................................................................... $ 2,268,702,050
Shares outstanding............................................................... 81,214,384
Net asset value and redemption price per share................................... $ 27.93
=========
CLASS Y SHARES
Net assets....................................................................... $ 867,357,282
Shares outstanding............................................................... 30,248,133
Net asset value and redemption price per share................................... $ 28.67
=========
</TABLE>
* On purchases of $100,000 or more, the offering price is reduced.
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
STATEMENT OF OPERATIONS
For the six months ended January 31, 2000 (Unaudited)
==============================================================================================================
<CAPTION>
INVESTMENT INCOME:
<S> <C> <C>
Income:
Dividends
Unaffiliated companies (Net of foreign withholding taxes of $85,348)........ $ 67,681,637
Affiliated companies........................................................ 2,468,080
Interest ........................................................................ 21,718,129
Lending fees..................................................................... 800,197
-----------------
Total income............................................................. 92,668,043
Expenses:
Management fees (Note 3)........................................ $ 39,835,152
Custodian fees.................................................. 939,464
Transfer agent fees
Class A.................................................... 3,316,535
Class B.................................................... 3,484,175
Class C.................................................... 1,325,461
Class Y.................................................... 128,006
Audit fees...................................................... 35,450
Legal fees...................................................... 79,809
Accounting fees (Note 3)........................................ 199,998
Reports to shareholders......................................... 958,679
Directors' fees and expenses.................................... 150,498
Registration and filing fees.................................... 661,867
Miscellaneous................................................... 162,156
Payments under distribution plan (Note 4)
Class A.................................................... 8,697,077
Class B.................................................... 23,229,658
Class C.................................................... 10,405,293
---------------
Total expenses.......................................................... 93,609,278
Expenses paid indirectly (Note 6)...................................... (9,965)
-----------------
Net expenses............................................................ 93,599,313
-----------------
Net investment loss................................................. (931,270)
-----------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from
Investment transactions:
Unaffiliated companies........................................................... (113,988,545)
Affiliated companies............................................................. (17,639,640)
Foreign currency transactions.................................................... 1,624,338
Net increase in unrealized appreciation of investments............................... 843,916,766
-----------------
Net realized and unrealized gain on investments...................................... 713,912,919
-----------------
Net increase in net assets resulting from operations.................... $ 712,981,649
=================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
<TABLE>
DAVIS NEW YORK VENTURE FUND
STATEMENT OF CHANGES IN NET ASSETS
==============================================================================================================
<CAPTION>
SIX
MONTHS ENDED
JANUARY 31, YEAR ENDED
2000 JULY 31,
(UNAUDITED) 1999
----------------- -----------------
OPERATIONS:
<S> <C> <C>
Net investment income (loss)...................................... $ (931,270) $ 27,992,881
Net realized gain(loss) from investments and
foreign currency transactions................................ (130,003,847) 538,193,208
Increase in unrealized appreciation of investments................ 843,916,766 1,349,318,618
----------------- -----------------
Net increase in net assets resulting
from operations.......................................... 712,981,649 1,915,504,707
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income:
Class A ..................................................... (694,746) (28,343,424)
Class B ..................................................... - -
Class C ..................................................... - -
Class Y ..................................................... (2,087,878) (3,078,683)
Realized gains from investment transactions:
Class A ..................................................... (170,895,345) (129,418,490)
Class B ..................................................... (105,337,602) (67,972,146)
Class C ..................................................... (47,026,438) (29,415,244)
Class Y ..................................................... (17,867,519) (7,965,994)
CAPITAL SHARE TRANSACTIONS:
Net increase (decrease) in net assets
resulting from capital share
transactions (Note 5)
Class A ..................................................... 467,234,018 75,397,977
Class B ..................................................... 404,184,637 777,460,404
Class C ..................................................... 288,187,060 327,436,231
Class Y ..................................................... 111,104,407 (22,403,667)
----------------- -----------------
Total increase in net assets...................................... 1,639,782,243 2,807,201,671
NET ASSETS:
Beginning of year................................................. 14,515,157,707 11,707,956,036
----------------- -----------------
End of year (including undistributed net investment income (deficit)
of $(3,647,950) and $65,944, respectively)........................ $ 16,154,939,950 $ 14,515,157,707
================= =================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
15
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS
January 31, 2000 (Unaudited)
================================================================================
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Fund is a separate series of Davis New York Venture Fund, Inc.,
which is registered under the Investment Company Act of 1940, as amended, as a
diversified, open-end management investment company. The Fund's investment
objective is growth of capital. The Fund offers shares in four classes, Class A,
Class B, Class C and Class Y. The Class A shares are sold with a front-end sales
charge and the Class B and Class C shares are sold at net asset value and may be
subject to a contingent deferred sales charge upon redemption. Class Y shares
are sold at net asset value and are not subject to any contingent deferred sales
charge. Class Y shares are only available to certain qualified investors.
Income, expenses (other than those attributable to a specific class) and gains
and losses are allocated daily to each class of shares based upon the relative
proportion of net assets represented by each class. Operating expenses directly
attributable to a specific class are charged against the operations of that
class. All classes have identical rights with respect to voting (exclusive of
each Class's distribution arrangement), liquidation and distributions. The
following is a summary of significant accounting policies followed by the Fund
in the preparation of its financial statements.
SECURITY VALUATION - Portfolio securities traded on national securities
exchanges are valued at the published last sales prices on the exchange, or, in
the absence of recorded sales, at the average of closing bid and asked prices on
such exchange. Over-the-counter securities are valued at the average of closing
bid and asked prices. If no quotations are available, the fair value of the
investment is determined by or at the direction of the Board of Directors.
Investments in short-term securities (maturing in sixty days or less) are valued
at amortized cost unless the Board of Directors determines that such cost is not
a fair value. The valuation procedures are reviewed and subject to approval by
the Board of Directors.
FEDERAL INCOME TAXES - It is the Fund's policy to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to shareholders. Therefore,
no provision for federal income or excise tax is required.
SECURITIES TRANSACTIONS AND RELATED INVESTMENT INCOME - Securities transactions
are accounted for on the trade date (date the order to buy or sell is executed)
with realized gain or loss on the sale of securities being determined based upon
identified cost. Dividend income is recorded on the ex-dividend date and
interest income is recorded on the accrual basis.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - Dividends and distributions to
shareholders are recorded on the ex-dividend date. The character of the
distributions made during the year from net investment income may differ from
its ultimate characterization for federal income tax purposes. Also, due to the
timing of distributions, the fiscal year in which amounts are distributed may
differ from the fiscal year in which income or gain was recorded by the Fund.
The Fund adjusts the classification of distributions to shareholders to reflect
the differences between financial statement amounts and distributions determined
in accordance with income tax regulations.
USE OF ESTIMATES IN FINANCIAL STATEMENTS - In preparing financial statements in
conformity with generally accepted accounting principles, management makes
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements, as well as the reported amounts of income and expenses
during the reporting period. Actual results may differ from these estimates.
16
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS - Continued
January 31, 2000 (Unaudited)
================================================================================
NOTE 2 - PURCHASES AND SALES OF SECURITIES
Purchases and sales of investment securities (excluding short-term
securities) for the six months ended January 31, 2000, were $2,731,260,432 and
$1,778,824,500 respectively.
NOTE 3 - INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Advisory fees are paid to Davis Selected Advisers, L.P. (the "Adviser")
at the annual rate of 0.75% of the average net assets for the first $250
million, 0.65% of the average net assets on the next $250 million, 0.55% of the
average net assets on the next $2.5 billion, 0.54% of the average net assets on
the next $1 billion, 0.53% of the average net assets on the next $1 billion,
0.52% of the average net assets on the next $1 billion, 0.51% of the average net
assets on the next $1 billion and 0.50% of the average net assets in excess of
$7 billion.
The Adviser is paid for registering Fund shares for sale in various
states. The fee for the six months ended January 31, 2000 amounted to $7,002.
State Street Bank & Trust Co. ("State Street Bank") is the Fund's primary
transfer agent. The Adviser is also paid for certain transfer agent services.
The fee for these services for the six months ended January 31, 2000 amounted to
$817,424. State Street Bank is the Fund's primary accounting provider. Fees for
such services are included in the custodian fee as State Street Bank also serves
as the Funds' custodian. The Adviser is also paid for certain accounting
services. The fee amounted to $199,998 for the six months ended January 31,
2000. Certain directors and the officers of the Fund are also directors and
officers of the general partner of the Adviser.
Davis Selected Advisers-NY, Inc. ("DSA-NY"), a wholly-owned subsidiary
of the Adviser, acts as sub-adviser to the Fund. DSA-NY performs research and
portfolio management services for the Fund under a Sub-Advisory Agreement with
the Adviser. The Fund pays no fees directly to DSA-NY.
The Fund has adopted procedures to treat Shelby Cullom Davis & Co.
("SCD") as an affiliate of the Adviser. During the six months ended January 31,
2000, SCD received $258,110 in commission on the purchases and sales of
portfolio securities in the Fund.
NOTE 4 - DISTRIBUTION AND UNDERWRITING FEES
CLASS A SHARES
Class A shares of the Fund are sold at net asset value plus a sales
charge and are redeemed at net asset value.
During the six months ended January 31, 2000, Davis Distributors, LLC,
the Fund's Underwriter (the "Underwriter" or "Distributor") received $7,472,142
from commissions earned on sales of Class A shares of the Fund, of which
$1,117,917 was retained by the Underwriter and the remaining $6,354,225 was
reallowed to investment dealers. The Underwriter paid the costs of prospectuses
in excess of those required to be filed as part of the Fund's registration
statement, sales literature and other expenses assumed or incurred by it in
connection with such sales.
17
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS - Continued
January 31, 2000 (Unaudited)
================================================================================
NOTE 4 - DISTRIBUTION AND UNDERWRITING FEES - CONTINUED
CLASS A SHARES - CONTINUED
The Underwriter is reimbursed for amounts paid to dealers as a service
fee with respect to Class A shares sold by dealers which remain outstanding
during the period. The service fee is paid at the annual rate of 1/4 of 1% of
the average net assets maintained by the responsible dealers. The Underwriter is
not reimbursed for accounts for which the Underwriter pays no service fees to
other firms. The service fee for Class A shares of the Fund for the six months
ended January 31, 2000 was $8,697,077.
CLASS B SHARES
Class B shares of the Fund are sold at net asset value and are redeemed
at net asset value less a contingent deferred sales charge if redeemed within
six years of purchase.
The Fund pays a distribution fee to reimburse the Distributor for
commission advances on the sale of the Fund's Class B shares. The National
Association of Securities Dealers, Inc., ("NASD") limits the percentage of the
Fund's average annual net assets attributable to Class B shares which may be
used to reimburse the Distributor. The limit is 1%, of which 0.75% may be used
to pay distribution expenses and 0.25% may be used to pay shareholder service
fees. The NASD rule also limits the aggregate amount the Fund may pay for
distribution to 6.25% of gross Fund sales since inception of the Rule 12b-1
plan, plus interest, at 1% over the prime rate on unpaid amounts. The
Distributor intends to seek full payment (plus interest at prime plus 1%) of
distribution charges that exceed the 1% annual limit in some future period or
periods when the plan limits have not been reached.
During the six months ended January 31, 2000, Class B shares of the
Fund made distribution plan payments which included distribution fees of
$17,440,816 and service fees of $5,788,842.
Commission advances by the Distributor during the six months ended
January 31, 2000 on the sale of Class B shares of the Fund amounted to
$20,783,873, of which $19,478,288 was reallowed to qualified selling dealers.
The Distributor intends to seek payment from Class B shares of the Fund
in the amount of $113,672,617 representing the cumulative commission advances by
the Distributor on the sale of the Fund's Class B shares, plus interest, reduced
by cumulative distribution fees paid by the Fund and cumulative contingent
deferred sales charges paid by redeeming shareholders. The Fund has no
contractual obligation to pay any such distribution charges and the amount, if
any, timing and condition of such payment are solely within the discretion of
the Directors who are not interested persons of the Fund or the Distributor.
A contingent deferred sales charge is imposed upon redemption of
certain Class B shares of the Fund within six years of the original purchase.
The charge is a declining percentage starting at 4% of the lesser of net asset
value of the shares redeemed or the total cost of such shares. During the six
months ended January 31, 2000 the Distributor received $5,344,248 in contingent
deferred sales charges from Class B shares of the Fund.
18
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS - Continued
January 31, 2000 (Unaudited)
================================================================================
NOTE 4 - DISTRIBUTION AND UNDERWRITING FEES - CONTINUED
CLASS C SHARES
Class C shares of the Fund are sold at net asset value and are redeemed
at net asset value less a contingent deferred sales charge of 1% if redeemed
within one year of purchase. The Fund pays the Distributor 1% of the Fund's
average annual net assets attributable to Class C shares, of which 0.75% may be
used to pay distribution expenses and 0.25% may be used to pay shareholder
service fees.
During the six months ended January 31, 2000, Class C shares of the
Fund made distribution payments of $10,405,293. During the six months ended
January 31, 2000, the Distributor received $449,704 in contingent deferred sales
charges from Class C shares of the Fund.
NOTE 5 - CAPITAL STOCK
At January 31, 2000, there were 3,000,000,000 shares of capital stock
($0.05 par value per share) authorized, 2,000,000,000 of which shares are
classified as Davis New York Venture Fund. Transactions in capital stock were as
follows:
<TABLE>
<CAPTION>
CLASS A SIX MONTHS ENDED
JANUARY 31, 2000 YEAR ENDED
(UNAUDITED) JULY 31, 1999
-------------------------------- --------------------------------
SHARES AMOUNT SHARES AMOUNT
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Shares subscribed.............................. 38,015,675 $1,051,889,934 77,281,967 $1,922,853,812
Shares issued in reinvestment of distributions. 5,695,039 156,867,402 5,790,849 139,096,019
-------------- -------------- -------------- --------------
43,710,714 1,208,757,336 83,072,816 2,061,949,831
Shares redeemed................................ (26,750,068) (741,523,318) (80,338,658) (1,986,551,854)
-------------- -------------- -------------- --------------
Net increase.............................. 16,960,646 $ 467,234,018 2,734,158 $ 75,397,977
============== ============== ============== ==============
<CAPTION>
CLASS B
SIX MONTHS ENDED
JANUARY 31, 2000 YEAR ENDED
(UNAUDITED) JULY 31, 1999
-------------------------------- --------------------------------
SHARES AMOUNT SHARES AMOUNT
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Shares subscribed.............................. 22,418,659 $ 608,084,829 47,698,106 $1,175,661,533
Shares issued in reinvestment of distributions. 3,647,517 98,373,982 2,706,344 64,247,379
-------------- -------------- -------------- --------------
26,066,176 706,458,811 50,404,450 1,239,908,912
Shares redeemed................................ (11,113,907) (302,274,174) (18,931,467) (462,448,508)
-------------- -------------- -------------- --------------
Net increase.............................. 14,952,269 $ 404,184,637 31,472,983 $ 777,460,404
============== ============== ============== ==============
</TABLE>
19
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS - Continued
January 31, 2000 (Unaudited)
================================================================================
NOTE 5 - CAPITAL STOCK - CONTINUED
<TABLE>
<CAPTION>
CLASS C
SIX MONTHS ENDED
JANUARY 31, 2000 YEAR ENDED
(UNAUDITED) JULY 31, 1999
-------------------------------- --------------------------------
SHARES AMOUNT SHARES AMOUNT
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Shares subscribed.............................. 15,185,109 $ 414,815,024 23,639,344 $ 592,450,371
Shares issued in reinvestment of distributions. 1,594,218 43,216,291 1,147,116 27,347,035
-------------- -------------- -------------- --------------
16,779,327 458,031,315 24,786,460 619,797,406
Shares redeemed................................ (6,209,580) (169,844,255) (11,903,414) (292,361,175)
-------------- -------------- -------------- --------------
Net increase.............................. 10,569,747 $ 288,187,060 12,883,046 $ 327,436,231
============== ============== ============== ==============
<CAPTION>
CLASS Y
SIX MONTHS ENDED
JANUARY 31, 2000 YEAR ENDED
(UNAUDITED) JULY 31, 1999
-------------------------------- --------------------------------
SHARES AMOUNT SHARES AMOUNT
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Shares subscribed.............................. 5,881,412 $ 162,277,419 15,338,275 $ 392,645,833
Shares issued in reinvestment of distributions. 608,968 16,926,098 354,272 8,580,467
-------------- -------------- -------------- --------------
6,490,380 179,203,517 15,692,547 401,226,300
Shares redeemed................................ (2,440,875) (68,099,110) (19,446,846) (423,629,967)
-------------- -------------- -------------- --------------
Net increase (decrease).............. 4,049,505 $ 111,104,407 (3,754,299) $ (22,403,667)
============== ============== ============== ==============
</TABLE>
NOTE 6 - CUSTODIAN FEES
Under an agreement with the custodian bank, custodian fees are reduced
for earnings on cash balances maintained at the custodian by the Fund. Such
reductions amounted to $9,965 during the six months ended January 31, 2000.
NOTE 7 - SECURITIES LOANED
Davis New York Venture Fund (the "Fund") has entered into a securities
lending arrangement with PaineWebber, Inc. Under the terms of the agreement, the
Fund receives fee income from lending transactions; in exchange for such fees,
PaineWebber, Inc. is authorized to loan securities on behalf of the Fund,
against receipt of collateral at least equal to the value of the securities
loaned. Cash collateral is invested by the Adviser in money market instruments.
As of January 31, 2000, the Fund had on loan securities valued at $285,479,506;
cash of $298,072,467 was received as collateral for the loans and has been
invested in approved instruments. The Fund bears the risk of any deficiency in
the amount of the collateral available for return to a borrower due to a loss in
an approved investment.
20
<PAGE>
DAVIS NEW YORK VENTURE FUND
FINANCIAL HIGHLIGHTS
CLASS A
================================================================================
Financial Highlights for a share of capital stock outstanding throughout each
period.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED JULY 31,
1/31/00 --------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period................ $27.73 $24.31 $22.91 $15.24 $14.56 $12.04
------ ------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income.......................... .04 .14 .20 .18 .20 .14
Net Realized and Unrealized Gains.............. 1.27 3.87 2.26 8.37 1.64 2.95
------ ------ ------ ------ ------ ------
Total From Investment Operations............. 1.31 4.01 2.46 8.55 1.84 3.09
Dividends and Distributions
Dividends from Net Investment Income........... -(4) (.11) (.23) (.18) (.15) (.12)
Distributions from Realized Gains.............. (.62) (.48) (.83) (.70) (1.01) (.45)
------ ------ ------ ------ ------ ------
Total Dividends and Distributions........... (.62) (.59) (1.06) (.88) (1.16) (.57)
------ ------ ------ ------ ------ ------
Net Asset Value, End of Period..................... $28.42 $27.73 $24.31 $22.91 $15.24 $14.56
====== ====== ====== ====== ====== ======
Total Return (1).................................... 4.80% 16.85% 11.16% 57.83% 13.04% 27.21%
Ratios/Supplemental Data
Net Assets, End of Period (000,000 omitted).... $8,110 $7,443 $6,458 $4,055 $2,151 $1,595
Ratio of Expenses to Average Net Assets........ .90% .90% .91% .89% .87%(2) .90%(2)
Ratio of Net Investment Income to Average
Net Assets................................... .34%* .56% .80% .98% 1.30% 1.11%
Portfolio Turnover Rate(3)..................... 12% 25% 11% 24% 19% 15%
</TABLE>
(1) Assumes 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. Total returns
are not annualized for periods of less than one full year.
(2) Prior to 1996, the ratio of expenses to average net assets included the
reduction of custodian fees.
(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.
(4) Less than $0.005 per share.
* Annualized
21
<PAGE>
DAVIS NEW YORK VENTURE FUND
FINANCIAL HIGHLIGHTS
CLASS B
================================================================================
Financial Highlights for a share of capital stock outstanding throughout each
period.
<TABLE>
<CAPTION>
SIX
MONTHS DECEMBER 20, 1994
ENDED YEAR ENDED JULY 31, (INCEPTION OF CLASS)
1/31/00 --------------------------------------- THROUGH
(UNAUDITED) 1999 1998 1997 1996 7/31/95
------ ------ ------ ------ ------ -------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period................. $27.25 $24.00 $22.64 $15.08 $14.43 $10.88
------ ------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income (Loss).................... (.06) (.14) .01 .01 .04 (.01)
Net Realized and Unrealized Gains............... 1.23 3.87 2.23 8.29 1.62 3.56
------ ------ ------ ------ ------ ------
Total From Investment Operations.............. 1.17 3.73 2.24 8.30 1.66 3.55
Dividends and Distributions
Dividends from Net Investment Income............ - - (.05) (.04) - -
Distributions from Realized Gains............... (.62) (.48) (.83) (.70) (1.01) -
------ ------ ------ ------ ------ ------
Total Dividends and Distributions............ (.62) (.48) (.88) (.74) (1.01) -
------ ------ ------ ------ ------ ------
Net Asset Value, End of Period...................... $27.80 $27.25 $24.00 $22.64 $15.08 $14.43
====== ====== ====== ====== ====== ======
Total Return (1)..................................... 4.36% 15.84% 10.22% 56.47% 11.81% 32.63%
Ratios/Supplemental Data
Net Assets, End of Period (000,000 omitted)..... $4,909 $4,405 $3,123 $1,196 $289 $40
Ratio of Expenses to Average Net Assets........ 1.71%* 1.74% 1.79% 1.79%(2) 1.73%(2) 1.78%*(2)
Ratio of Net Investment Income (Loss) to
Average Net Assets.......................... (.50)%* (.28)% (.08)% .07% .44% .23%*
Portfolio Turnover Rate(3)...................... 12% 25% 11% 24% 19% 15%
</TABLE>
(1) Assumes hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), 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. Total returns are not annualized for periods of less
than one full year.
(2) Ratio of expenses to average net assets after the reduction of custodian
fees under a custodian agreement was 1.78% for the year ended July 31,
1997. Prior to 1996, such reductions were reflected in the expense ratios.
(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.
* Annualized.
22
<PAGE>
DAVIS NEW YORK VENTURE FUND
FINANCIAL HIGHLIGHTS
CLASS C
================================================================================
Financial Highlights for a share of capital stock outstanding throughout each
period.
<TABLE>
<CAPTION>
SIX MONTHS DECEMBER 20, 1994
ENDED YEAR ENDED JULY 31, (INCEPTION OF CLASS)
1/31/00 --------------------------------------- THROUGH
(UNAUDITED) 1999 1998 1997 1996 7/31/95
------ ------ ------ ------ ------ -------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period................ $27.38 $24.09 $22.72 $15.12 $14.47 $11.16
------ ------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income (Loss)................... (.05) (.10) .02 .02 .04 (.01)
Net Realized and Unrealized Gains.............. 1.22 3.87 2.24 8.32 1.62 3.32
------ ------ ------ ------ ------ ------
Total From Investment Operations............. 1.17 3.77 2.26 8.34 1.66 3.31
Dividends and Distributions
Dividends from Net Investment Income........... - - (.06) (.04) - -
Distributions from Realized Gains.............. (.62) (.48) (.83) (.70) (1.01) -
------ ------ ------ ------ ------ ------
Total Dividends and Distributions............ (.62) (.48) (.89) (.74) (1.01) -
------ ------ ------ ------ ------ ------
Net Asset Value, End of Period..................... $27.93 $27.38 $24.09 $22.72 $15.12 $14.47
====== ====== ====== ====== ====== ======
Total Return (1).................................... 4.34% 15.95% 10.27% 56.59% 11.78% 29.66%
Ratios/Supplemental Data
Net Assets, End of Period (000,000 omitted).... $2,269 $1,934 $1,391 $573 $117 $12
Ratio of Expenses to Average Net Assets ...... 1.69%* 1.72% 1.71% 1.73% 1.73%(2) 1.78%*(2)
Ratio of Net Investment Income (Loss) to
Average Net Assets........................ (.48)%* (.26)% .00% .13% .44% .23%*
Portfolio Turnover Rate(3)..................... 12% 25% 11% 24% 19% 15%
</TABLE>
(1) Assumes hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), 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. Total returns are not annualized for periods of less
than one full year.
(2) Prior to 1996, the ratio of expenses to average net assets included the
reduction of custodian fees.
(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.
* Annualized.
23
<PAGE>
DAVIS NEW YORK VENTURE FUND
FINANCIAL HIGHLIGHTS
CLASS Y
================================================================================
Financial Highlights for a share of capital stock outstanding throughout each
period.
<TABLE>
<CAPTION>
SIX MONTHS OCTOBER 2, 1996
ENDED YEAR ENDED JULY 31, (INCEPTION OF CLASS)
1/31/00 ----------------- THROUGH
(UNAUDITED) 1999 1998 7/31/97
------ ------ ------ ------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period............... $28.00 $24.55 $23.12 $16.66
------ ------ ------ ------
Income From Investment Operations
Net Investment Income......................... .07 .25 .24 .15
Net Realized and Unrealized Gains............. 1.29 3.87 2.31 7.07
------ ------ ------ ------
Total From Investment Operations............ 1.36 4.12 2.55 7.22
Dividends and Distributions
Dividends from Net Investment Income.......... (.07) (.19) (.29) (.06)
Distributions from Realized Gains............. (.62) (.48) (.83) (.70)
------ ------ ------ ------
Total Dividends and Distributions.......... (.69) (.67) (1.12) (.76)
------ ------ ------ ------
Net Asset Value, End of Period.................... $28.67 $28.00 $24.55 $23.12
====== ====== ====== ======
Total Return(1).................................... 4.95% 17.19% 11.48% 44.71%
Ratios/Supplemental Data
Net Assets, End of Period (000,000 omitted)... $867 $734 $735 $534
Ratio of Expenses to Average Net Assets...... .60%* .62% .59% .62%*
Ratio of Net Investment Income to Average Net
Assets...................................... .61%* .84% 1.12% 1.19%*
Portfolio Turnover Rate(2).................... 12% 25% 11% 24%
</TABLE>
(1) Assumes hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), 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. Total returns are not annualized
for periods of less than one full year.
(2) 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.
* Annualized.
24
<PAGE>
DAVIS NEW YORK
VENTURE FUND
2949 East Elvira Road, Tucson, Arizona 85706
DIRECTORS OFFICERS
Wesley E. Bass, Jr. Jeremy H. Biggs
Jeremy H. Biggs Chairman
Marc P. Blum Christopher C. Davis
Andrew A. Davis President
Christopher C. Davis Kenneth C. Eich
Jerry D. Geist Vice President
D. James Guzy Sharra L. Reed
G. Bernard Hamilton Vice President,
Laurence W. Levine Treasurer & Assistant Secretary
Christian R. Sonne Thomas D. Tays
Marsha Williams Vice President& Secretary
Andrew A. Davis
Vice President
INVESTMENT ADVISER
Davis Selected Advisers, L.P.
2949 East Elvira Road, Suite101
Tucson, Arizona 85706
(800) 279-0279
DISTRIBUTOR
Davis Distributors, LLC
2949 East Elvira Road, Suite101
Tucson, Arizona 85706
TRANSFER AGENT & CUSTODIAN
State Street Bank and Trust Company
c/o The Davis Funds
P.O. Box 8406
Boston, Massachusetts 02266-8406
COUNSEL
D'Ancona & Pflaum
111 E. Wacker Drive, Suite 2800
Chicago, Illinois 60601-4205
AUDITORS
KPMG LLP
707 Seventeenth Street
Suite 2300
Denver, Colorado 80202
FOR MORE INFORMATION ABOUT DAVIS NEW YORK VENTURE FUND INCLUDING MANAGEMENT
FEES, CHARGES AND EXPENSES, SEE THE CURRENT PROSPECTUS WHICH MUST PRECEDE OR
ACCOMPANY THIS REPORT.
<PAGE>
Davis Selected Advisers, L.P.
2949 East Elvira Road
Suite 101
Tucson, AZ 85706
1-800-279-0279
www.davisfunds.com
[DAVIS FUNDS LOGO]
