<PAGE>
ANNUAL REPORT
[DAVIS LOGO]
JULY 31, 2000
Davis New York
Venture Fund
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
Dear Fellow Shareholder,
We are optimists at heart and we believe that stocks offer the best means of
creating wealth over the long term. Historically, stocks have won over time
because they represent claims on growth, not a fixed promise to pay a fixed
amount, which is the case with bonds.(1) As gross domestic product (GDP) and
corporate profits grow, so does the valuation floor for stocks.
With that as a backdrop, every day when we come to work we try to do four
things. First, we seek out businesses that will grow, preferably ones that need
little new capital because that means they are the most self-sufficient.
Second, we evaluate the judgment, vision and integrity of management. We want to
get a good feel for what management plans to do with the free cash flows
generated by the business--be it making new investments, acquiring other
businesses or increasing dividends.
Third, we value those businesses against the alternatives, seeking to determine
what "mystery" coupon or rate of return the business will produce for its
stockowners. In other words, we determine what we would be willing to pay for
the business in order to provide us with a better projected rate of return than
the coupon rate on risk-free alternatives such as 10-year Treasury bonds, and we
try to buy the companies when they are attractively valued.
Fourth, we consider this analysis within the context of where we are in the
stock market cycle. We know we are on a long journey. If equities grow at a rate
of around 7% a year over the next 30 years, which is a little less than their
long-term average growth rate, that would take the Dow Jones Industrial Average
from around 10,000 to 80,000 by 2030.(2) At the same time, we are mindful that
road conditions will not always be favorable and that there will be checkpoints
along the way because different eras create different risk profiles.
Looking ahead over the next few years, we recognize that we are unlikely to
continue enjoying the big drivers of stock performance that we have had over the
past 15 to 20 years--namely, dramatically rising corporate profits, steeply
falling interest rates and sharply higher price/earnings (P/E) valuations.
Inflation and interest rates have plateaued at best and may be increasing, which
means caution lights are flashing on the road ahead. If inflation keeps
climbing, the Federal Reserve will take concerted action after the presidential
election, raising interest rates even further and therefore the risk-free hurdle
rate against which all stocks have to compete. As for corporate profits, they
still have a green light, but they have been inflated by various accounting
practices and cannot keep growing their share of GDP forever.
All of this leads us to believe that the market could be in a 30% to 50% trading
range over the next 5 to 10 years before there is a big break out again. That is
a lot of movement in points, but not much in percentage terms, particularly when
you consider the market went up tenfold (from 1,000 to 10,000) over the past 20
years. Although the rate of growth may be slowing, we still anticipate a fairly
favorable environment for stocks. The Federal Reserve is doing its job right by
trying to prolong the cycle, deflate a bubble and prevent a boom/bust scenario.
Even if we stay in a trading-range market for some time, there should always be
opportunities for stock picking.
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
We think multinationals may be a fertile area to investigate whether they are in
the technology, drug or financial sector. For several years, these companies
have been fighting headwinds related to various financial crises around the
world, the strength of the dollar and the market's fixation on Internet
companies. Now high-quality multinationals with proven management teams may move
into the spotlight because they have flexibility to allocate capital around the
globe to wherever it may earn the best return, and with a world population of
around six billion, their potential customer base is huge.
Contrary to what some people may believe, we are not against technology.
Particularly in a difficult market when you have to be a good stock picker, it
is useful to identify a theme. Over the next decade, technology is almost
certain to be a key investment trend, whether it be the inventors of technology
or traditional companies that successfully apply technology in their business
models. American Express(3) is one example of a company that is likely to
benefit as consumers buy more and more over the Internet, charging purchases on
their credit cards. In addition, there are a number of financial and other
companies that will use the Internet to drive down their costs or to leverage
their brand power and broaden their marketing reach. If these companies are also
multinational, so much the better because they can do this all over the world.
Of course, no one knows for sure exactly what the next few years will bring. But
regardless of election results, inflation, interest rates or profit trends, we
will continue to manage money according to the same generational philosophy we
have applied for decades in all types of markets. Investing is a batting average
business, full of strikeouts and mistakes as well as home runs. Rest assured
that we will try to do sensible things every day when we come to work and do the
best we can because our money is invested side by side with our fellow
shareholders. We continue to believe that stocks are the best way to build
long-term wealth. Staying invested puts time on our side and gives compounding
the opportunity to work for us all.(4)
Sincerely,
/s/ Shelby M.C. Davis
Shelby M.C. Davis
Senior Research Adviser
September 6, 2000
2
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
MANAGEMENT'S DISCUSSION AND ANALYSIS
PERFORMANCE OVERVIEW
The Davis New York Venture Fund continues to outpace the Standard & Poor's 500
Index.(5) The Fund's Class A shares delivered a total return on net asset value
of 6.54% for the year to date through July 31, 2000, while the S&P 500 declined
1.98%.(6) For the six-month and one-year periods ended July 31, 2000, the Fund's
Class A shares generated returns of 7.81% and 12.99%, respectively, versus
returns of 3.20% and 8.97%, respectively, for the S&P 500.
The Davis New York Venture 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.(7) The Fund's Class A
shares have generated an average annual total return of 15.07% since inception
versus a return of 12.68% for the S&P 500 over the same time frame.
According to Morningstar, "The fund's long-term record is nothing short of
fantastic, and it has been produced with a remarkable amount of
consistency...."(8)
AN INTERVIEW WITH CHRISTOPHER C. DAVIS AND KENNETH CHARLES FEINBERG, PORTFOLIO
MANAGERS
Q. How would you describe the performance of the Fund so far this year?
A. As Ken and I have often said, performance over any half-year, one-year or
even two-year period is often unpredictable and rarely significant. Thus, we are
reluctant to read too much into the strong relative results of the Davis New
York Venture Fund so far this year.
That said, with regard to individual holdings, we have been very pleased with
the performance of several companies that were relatively recent additions to
the portfolio. In general, these companies were purchased while their stock
prices languished under clouds of uncertainty or even scandal. In such cases,
Ken and I believe that while we are taking what might be called "headline" risk,
the fact that we are buying the companies after bad news has been disclosed
often limits our economic risk.
Our purchase of American Home Products(3), for example, came at a time when the
company was facing litigation concerning unforeseen side effects with one of its
drugs. While there was always a risk that the consequences of this litigation
could have been much worse than we anticipated, we believed that the stock price
more than discounted the likely outcome and that, as the clouds of uncertainty
lifted, investors would again recognize the powerful new products and strong
position of this company. Our colleague Danton Goei was an important resource in
the Fund's opportunistic purchase of this company at significantly lower prices.
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
Similarly, our decision to triple our holdings in Tyco came at a time when the
company was undergoing SEC scrutiny regarding its accounting for a number of
mergers and acquisitions. Ken led an incredibly thorough research effort on this
complex company and was ably assisted by Adam Seessel in reconstructing all of
the company's recent acquisitions and arriving at the conclusion that
management's accounting practices were quite reasonable.
Although these companies could still prove to be disappointing investments if
bad news subsequently comes to light, we think both are illustrative of our
willingness to purchase companies opportunistically while others are anxiously
selling. Such decisions can only be made with conviction based on thorough and
independent research and on the recognition that short-term movements in stock
prices often reflect changes in psychology rather than changes in economics.
Q. Could you comment on the overall market environment this year and its impact
on the Fund's portfolio?
A. Turning from those specifics of the portfolio to the market in general, the
year 2000 has proven to be another period of tremendous stock price volatility.
The relative flatness of the market averages is deceptive in that it masks
enormous underlying gyrations in the prices of individual issues. The best way
to demonstrate this is by examining the portfolio holdings of the Davis New York
Venture Fund.
Over the 12-month period ended June 30, 2000, 34 of our top 40
holdings--representing more than 70% of the portfolio-- had a range of more than
50% between their lowest low and their highest high. Even more telling, 16 of
the Fund's top 40 positions had a range of more than 100%, five a range of more
than 150% and two a range of more than 200% between their lowest and highest
price for the period.
Given that we generally own more established companies, as opposed to Internet
start-ups, these sorts of ranges are remarkable. A natural consequence of such
volatility, other factors being equal, is a tendency toward higher turnover.
These enormous price swings mean companies are more likely to advance from a
range of fair value to levels at which Ken and I would consider them overvalued
and therefore candidates for sale, or conversely to decline to such prices that
we would consider adding to our positions.
Another recent characteristic of the market has been a constant lowering of the
quality of reported earnings. As anyone who runs a business can attest,
perfectly predictable and consistent results can rarely be achieved in precise
12-week intervals. Yet Wall Street has come to place such a premium on
consistent results that increasingly corporate America is torturing accounting
policies to create the illusion of predictability and consistency in these short
quarterly periods. As a result, earnings are frequently not what they seem, and
reported results often include nonrecurring items such as favorable changes in
pension fund assumptions, gains on sales of operations or securities, expense
reductions from previously incurred restructuring charges and other financial
gimmicks. Thus, most companies' quarterly earnings must be scrutinized much more
intensively than ever before.
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
While we hope not to own many of the most flagrant offenders in the Davis New
York Venture Fund, we would expect that over the next several years the
newspapers will be full of companies forced to come clean when their bag of
accounting tricks is empty. Once a company starts down this path, it is
difficult to stop as inflated results in the current quarter become increasingly
difficult comparisons for future quarters.
Q. What final thoughts would you like to leave with your fellow shareholders?
A. While these observations may sound pessimistic, I am reminded of my father's
comment last year that our goal is to be neither optimistic nor pessimistic, but
to do our best to be realistic. As we have said in the past, the reality is that
returns in the next decade are unlikely to be near the levels enjoyed in the
last two decades. The danger is that as investors move from a position of almost
universal optimism to a more realistic stance equity valuations could suffer
significantly. It is the tendency of markets, like pendulums, not to move to the
middle ground and stop, but instead to swing markedly to the other side. While
such a significant correction would create many buying opportunities, it is
unlikely that investors would have the stomach to pursue them. Therein lies the
biggest danger facing investors.
This danger was illustrated in the March issue of Mutual Funds magazine, which
featured the following statistic. According to the magazine, "Between 1984 and
the end of 1998, the average stock fund gained 509%, or 12.8% per year over 15
years. Meanwhile, the typical mutual fund investor, whose average holding period
was less than three years, earned just 186% or 7.25% a year." This staggering
underperformance of the average fund investor was self-inflicted as it came from
money flowing into the funds with great short-term performance and then flowing
out of those funds when future results were disappointing.
If Ken and I can leave any message with our fellow shareholders, it is to fight
the very human tendency to feel elated and optimistic when prices are high (as
they are today) and discouraged and pessimistic when prices are low. Now when
times are good is the right time to sound the cautious note. In doing so, we
hope that we will all be better positioned to be optimistic and opportunistic
when times look more bleak.(4)
5
<PAGE>
DAVIS NEW YORK VENTURE FUND
2949 East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
This Annual Report is authorized for distribution only when accompanied or
preceded by a current prospectus of Davis New York Venture Fund which contains
more information about risks, fees and expenses. Please read the prospectus
carefully before investing or sending money.
(1) Historically, common stocks have outperformed both bonds and cash. There is
no assurance that this will continue to be true in the future.
(2) This hypothetical example illustrates the power of compounding over a
30-year period, and is not intended to be indicative of future investment
results, which may be higher or lower than the assumed 7% rate.
(3) See the Fund's Schedule of Investments for a detailed list of portfolio
holdings.
(4) This report reflects the professional opinions of Shelby M.C. Davis and
Davis New York Venture Fund's portfolio managers. All investments involve some
degree of risk, there can be no assurance that the Fund's investment strategies
will be successful. Prices of shares will vary, so that when redeemed, an
investor's shares could be worth more or less than their original cost.
(5) 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.
(6) 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 when purchased. Below are the average
annual total returns for Davis New York Venture Fund's Class A shares for
periods ending July 31, 2000. Returns for other classes of shares will vary from
the following returns:
(Without a 4.75% sales charge taken into consideration)
--------------------------------------------------------------------------------
FUND NAME 1 YEAR 5 YEAR 10 YEAR INCEPTION
--------- ------ ------ ------- ---------
--------------------------------------------------------------------------------
New York Venture A 12.99% 21.24% 19.13% 15.07%-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 7.64% 20.06% 18.55% 14.89%-02/17/69
--------------------------------------------------------------------------------
6
<PAGE>
DAVIS NEW YORK VENTURE FUND 2949
East Elvira Road, Suite 101
Tucson, Arizona 85706
================================================================================
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
(7) 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 31 of each year. The Fund's returns assume an investment in Class A
shares on January 1 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.
(8) Source: Morningstar Mutual Funds, July 17, 2000.
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.
7
<PAGE>
DAVIS NEW YORK VENTURE FUND
COMPARISON OF DAVIS NEW YORK VENTURE FUND, INC., CLASS A SHARES AND STANDARD AND
POOR'S 500 STOCK INDEX
================================================================================
Average Annual Total Return For the Periods ended July 31, 2000.
-----------------------------------------------------------------
CLASS A SHARES
(This calculation includes an initial sales charge of 4 3/4%).
One Year ........................................ 7.64%
Five Years........................................ 20.06%
Ten Years......................................... 18.55%
-----------------------------------------------------------------
$10,000 INVESTED OVER TEN YEARS. Let's say you invested $10,000 in Davis New
York Venture Fund, Class A Shares on July 31, 1990 and paid a 4 3/4% sales
charge. As the chart shows, by July 31, 2000 the value of your investment would
have grown to $54,832 - a 448.32% increase on your initial investment. For
comparison, look at how the S&P 500 did over the same period. With dividends
reinvested, the same $10,000 investment would have grown to $50,737 - a 407.37%
increase.
Class A
S&P 500 DNYVF-A
Jul-90 10,000.00 9,523.33
Jul-91 11,273.00 10,883.97
Jul-92 12,712.49 12,916.83
Jul-93 13,819.75 15,538.55
Jul-94 14,528.71 16,456.37
Jul-95 18,316.34 20,933.81
Jul-96 21,347.69 23,671.70
Jul-97 32,471.98 37,360.44
Jul-98 38,732.57 41,531.28
Jul-99 46,560.43 48,527.78
Jul-00 50,737.04 54,832.33
Standard & Poor's Stock Index is an unmanaged index and has no specific
investment objective. The index used includes net dividends reinvested, but does
not take into account any sales charge. Investments cannot be made directly into
the index.
The performance data for Davis New York Venture Fund contained in this report
represents past performance and assumes that all distributions were reinvested,
and should not be considered as an indication of future performance from an
investment in the Fund today. The investment return and principal value will
fluctuate so that shares may be worth more or less than their original cost when
redeemed.
8
<PAGE>
DAVIS NEW YORK VENTURE FUND
COMPARISON OF DAVIS NEW YORK VENTURE FUND, INC., CLASS B SHARES AND STANDARD AND
POOR'S 500 STOCK INDEX
================================================================================
Average Annual Total Return For the Periods ended July 31, 2000.
-------------------------------------------------------------------------------
CLASS B SHARES
(This calculation includes any applicable contingent deferred sales charge.)
One Year................................................... 8.06%
Five Year..................................................19.96%
Life of Class (December 1, 1994 through July 31, 2000) ....23.51%
-------------------------------------------------------------------------------
$10,000 INVESTED AT INCEPTION. Let's say you invested $10,000 in Davis New York
Venture Fund, Class B Shares on December 1, 1994 (inception of class). As the
chart shows, by July 31, 2000 the value of your investment (less applicable
contingent deferred sales charges) would have grown to $33,107 - a 231.07%
increase on your initial investment. For comparison, the S&P 500 is also
presented on the chart below.
Class B
S&P 500 DNYVF-B
12/1/94 10,000.00 10,000.00
Jul-95 12,736.00 13,262.87
Jul-96 14,843.81 14,833.80
Jul-97 22,578.92 23,210.48
Jul-98 26,932.13 25,581.82
Jul-99 32,375.12 29,633.31
Jul-00 35,279.26 33,106.93
Standard & Poor's Stock Index is an unmanaged index and has no specific
investment objective. The index used includes net dividends reinvested, but does
not take into account any sales charge. Investments cannot be made directly into
the index.
The performance data for Davis New York Venture Fund contained in this report
represents past performance and assumes that all distributions were reinvested,
and should not be considered as an indication of future performance from an
investment in the Fund today. The investment return and principal value will
fluctuate so that shares may be worth more or less than their original cost when
redeemed.
9
<PAGE>
DAVIS NEW YORK VENTURE FUND
COMPARISON OF DAVIS NEW YORK VENTURE FUND, INC., CLASS C SHARES AND STANDARD AND
POOR'S 500 STOCK INDEX
================================================================================
Average Annual Total Return For the Periods ended July 31, 2000.
----------------------------------------------------------------------------
CLASS C SHARES
(This calculation includes any applicable contingent deferred sales charge.)
One Year..................................................... 11.07%
Five Year.................................................... 20.20%
Life of Class (December 20, 1994 through July 31, 2000) ..... 23.35%
----------------------------------------------------------------------------
$10,000 INVESTED AT INCEPTION. Let's say you invested $10,000 in Davis New York
Venture Fund, Class C Shares on December 20, 1994 (inception of class). As the
chart shows, by July 31, 2000 the value of your investment would have grown to
$32,531 - a 225.31% increase on your initial investment. For comparison, the S&P
500 is also presented on the chart below.
Class C
S&P 500 DNYVF-C
12/20/94 10,000.00 10,000.00
Jul-95 12,493.00 12,965.94
Jul-96 14,560.59 14,497.33
Jul-97 22,148.12 22,701.30
Jul-98 26,418.27 25,033.85
Jul-99 31,757.41 29,025.62
Jul-00 34,606.14 32,530.68
Standard & Poor's Stock Index is an unmanaged index and has no specific
investment objective. The index used includes net dividends reinvested, but does
not take into account any sales charge. Investments cannot be made directly into
the index.
The performance data for Davis New York Venture Fund contained in this report
represents past performance and assumes that all distributions were reinvested,
and should not be considered as an indication of future performance from an
investment in the Fund today. The investment return and principal value will
fluctuate so that shares may be worth more or less than their original cost when
redeemed.
10
<PAGE>
DAVIS NEW YORK VENTURE FUND
COMPARISON OF DAVIS NEW YORK VENTURE FUND, INC., CLASS Y SHARES AND STANDARD AND
POOR'S 500 STOCK INDEX
================================================================================
Average Annual Total Return For the Periods ended July 31, 2000.
---------------------------------------------------------------------------
CLASS Y SHARES
(There is no sales charge applicable to this calculation.)
One Year................................................... 13.33%
Life of Class (October 2, 1996 through July 31, 2000) ..... 22.01%
---------------------------------------------------------------------------
$10,000 INVESTED AT INCEPTION. Let's say you invested $10,000 in Davis New York
Venture Fund, Class Y Shares on October 2, 1996 (inception of class). As the
chart shows, by July 31, 2000 the value of your investment would have grown to
$21,424 - a 114.24% increase on your initial investment. For comparison, the S&P
500 is also presented on the chart below
Class Y
S&P 500 DNYVF-Y
10/2/96 10,000.00 10,000.00
Jul-97 13,967.20 14,471.06
Jul-98 16,660.08 16,131.68
Jul-99 20,027.08 18,904.20
Jul-00 21,823.57 21,423.89
Standard & Poor's Stock Index is an unmanaged index and has no specific
investment objective. The index used includes net dividends reinvested, but does
not take into account any sales charge. Investments cannot be made directly into
the index.
The performance data for Davis New York Venture Fund contained in this report
represents past performance and assumes that all distributions were reinvested,
and should not be considered as an indication of future performance from an
investment in the Fund today. The investment return and principal value will
fluctuate so that shares may be worth more or less than their original cost when
redeemed.
11
<PAGE>
DAVIS NEW YORK VENTURE FUND
PORTFOLIO HOLDINGS AS OF JULY 31, 2000
================================================================================
PORTFOLIO MAKEUP (% OF FUND NET ASSETS)
---------------------------------------
PREFERRED STOCKS 0.5%
SHORT TERM INVESTMENTS, OTHER ASSETS & LIABILITIES 9.0%
COMMON STOCKS 90.5%
SECTOR WEIGHTINGS (% OF LONG TERM PORTFOLIO)
--------------------------------------------
DIVERSIFIED 8.1%
TELECOMMUNICATIONS 9.3%
INSURANCE 6.4%
TECHNOLOGY 12.6%
ELECTRONICS 5.1%
WHOLESALE 2.7%
FINANCIAL SERVICES 22.9%
BUILDING MATERIALS 4.5%
OTHER 8.0%
BANKING 7.9%
PHARMACEUTICALS 9.7%
FOOD & RESTAURANTS 2.8%
<TABLE>
<CAPTION>
TOP 10 HOLDINGS % OF FUND
STOCK SECTOR NET ASSETS
-----------------------------------------------------------------------------------------------------
<S> <C> <C>
American Express Co. Financial Services 5.83%
Citigroup, Inc. Financial Services 4.71%
Hewlett-Packard Co. Technology 4.36%
Tyco International Ltd. Diversified Manufacturing 4.02%
Household International, Inc. Financial Services 3.87%
American Home Products Corp. Pharmaceutical and Health Care 3.47%
Wells Fargo & Co. Banks and Savings & Loans 3.41%
International Business Machines Corp. Technology 3.21%
Morgan Stanley Dean Witter & Co. Investment Firms 2.88%
McDonald's Corp. Food & Restaurant 2.54%
</TABLE>
12
<PAGE>
DAVIS NEW YORK VENTURE FUND
PORTFOLIO ACTIVITY - AUGUST 1, 1999 THROUGH JULY 31, 2000
================================================================================
NEW POSITIONS ADDED (8/1/99-7/31/00)
(Highlighted positions are those greater than 0.99% of 7/31/00 total net
assets.)
<TABLE>
<CAPTION>
% OF 7/31/00
DATE OF 1ST FUND
SECURITY SECTOR PURCHASE NET ASSETS
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Agilent Technologies, Inc. Electronics 11/17/99 0.65%
AT&T Corp. Telecommunications 10/6/99 1.19%
AT&T Wireless Group Telecommunications 4/26/00 0.29%
BMC Software, Inc. Technology 1/11/00 0.54%
Costco Wholesale Corp. Wholesale 5/24/00 2.49%
Kansas City Southern Industries, Inc. Transportation 6/28/00 -
Lexmark International, Inc. Technology 10/29/99 1.45%
Eli Lilly and Co. Pharmaceutical and Health Care 2/29/00 0.80%
Lloyds TSB Group PLC Banks and Savings & Loans 6/12/00 0.56%
Lucent Technologies, Inc. Telecommunications 1/7/00 2.04%
MediaOne Group, Inc. Telecommunications 12/1/99 -
Novell, Inc. Technology 10/5/99 0.25%
Sprint Corp. Telecommunications 1/4/00 0.14%
Sun Life Financial Services of Canada Life Insurance 3/22/00 0.13%
Tellabs, Inc. Telecommunications 3/9/00 2.46%
United Parcel Services, Inc. Transportation 11/9/99 -
WorldCom, Inc. Telecommunications 1/4/00 0.21%
</TABLE>
POSITIONS CLOSED (8/1/99-7/31/00)
(Gains and losses greater than $3 million are highlighted.)
<TABLE>
<CAPTION>
DATE OF
STOCK SECTOR FINAL SALE GAIN/(LOSS)
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
The Allstate Corp. Property/Casualty Insurance 9/24/99 $ 40,830,540
Boardwalk Equities, Inc. Real Estate 6/22/00 (316,010)
Colgate-Palmolive Co. Consumer Products 2/16/00 14,296,795
Cooper Cameron Corp. Energy 8/5/99 695,989
Crescent Real Estate Equities Co. Real Estate 5/11/00 (18,842,230)
Gables Residential Trust Real Estate 9/3/99 (650,517)
Halliburton Co. Energy 9/29/99 19,876,937
Harcourt General, Inc. Publishing 1/10/00 (17,639,640)
Kansas City Southern Industries, Inc. Transportation 7/13/00 59,808
Mack-Cali Realty Corp. Real Estate 5/2/00 (4,359,626)
Morgan Stanley Dean Witter Asia International Closed-End
Pacific Fund Inc. Investment Company 8/30/99 435,116
The Neiman Marcus Group, Inc., Class B Retail 3/16/00 (1,981,277)
New England Electric System Utilities 3/23/00 225,952
Nielson Media Research Commercial Services 9/17/99 57,223
Oracle Corp. Technology 4/27/00 451,584,684
Public Storage, Inc. Real Estate 4/24/00 (905,822)
ReliaStar Financial Corp. Life Insurance 8/26/99 (9,166)
Rouse Co. Real Estate 12/3/99 (17,236,461)
Rouse Co., $3.00, Ser B, Cum.Conv. Pfd Real Estate 1/7/00 (2,433,168)
SAP AG-ADR Technology 5/4/00 22,227,883
</TABLE>
13
<PAGE>
DAVIS NEW YORK VENTURE FUND
PORTFOLIO ACTIVITY - AUGUST 1, 1999 THROUGH JULY 31, 2000 - CONTINUED
================================================================================
POSITIONS CLOSED (8/1/99-7/31/00) - CONTINUED
(Gains and losses greater than $3 million are highlighted.)
<TABLE>
<CAPTION>
DATE OF
STOCK SECTOR FINAL SALE GAIN/(LOSS)
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
UBS AG Banks and Savings & Loans 11/3/99 (34,702,777)
Unisys Corp. Technology 1/7/00 (13,566,436)
United Parcel Services, Inc. Transportation 11/10/99 2,912,195
Vornado Realty Trust Real Estate 5/3/00 15,068,378
</TABLE>
14
<PAGE>
DAVIS NEW YORK VENTURE FUND - CLASS A SHARES
ILLUSTRATION OF THE GROWTH OF AN ASSUMED INVESTMENT OF $10,000
================================================================================
ILLUSTRATION OF THE GROWTH OF AN ASSUMED INVESTMENT
WITH DIVIDENDS REINVESTED AND CAPITAL GAIN DISTRIBUTIONS ACCEPTED IN ADDITIONAL
SHARES
The chart below reflects an assumed investment of $10,000 covering the period
from February 17, 1969 to July 31, 2000, the life of the Company. The period was
one in which common stock prices fluctuated and was characterized by periods of
substantial market advances as well as periods of substantial market declines.
The results should not be considered as a representation of the dividend income
or capital gain or loss which may be realized from an investment made in the
Company today.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
1969 $9,574.11 $0.00 $0.00 $0.00 $0.00 $10,000.00
1970 $7,560.88 $0.00 $96.99 $0.00 $131.58 $10,000.00
1971 $10,206.38 $113.29 $130.93 $76.15 $131.58 $10,000.00
1972 $12,110.70 $187.61 $155.36 $143.51 $131.58 $10,000.00
1973 $10,525.33 $192.52 $364.22 $177.41 $402.76 $10,000.00
1974 $7,845.59 $247.26 $274.95 $306.32 $402.76 $10,000.00
1975 $8,371.48 $572.10 $324.30 $537.17 $402.76 $10,000.00
1976 $10,225.14 $1,007.97 $353.84 $857.06 $402.76 $10,000.00
1977 $11,106.94 $1,331.25 $384.35 $1,070.51 $402.76 $10,000.00
1978 $13,742.87 $1,985.37 $771.47 $1,331.46 $631.09 $10,000.00
1979 $14,549.72 $2,544.00 $1,390.28 $1,749.83 $1,173.85 $10,000.00
1980 $17,484.08 $3,674.55 $4,504.18 $2,220.05 $3,333.50 $10,000.00
1981 $17,767.36 $4,759.89 $9,242.87 $3,171.12 $7,660.36 $10,000.00
1982 $11,069.42 $4,060.53 $12,287.68 $4,381.36 $15,136.73 $10,000.00
1983 $17,861.17 $7,918.92 $22,564.15 $5,341.65 $16,862.76 $10,000.00
1984 $13,320.83 $6,870.98 $24,507.57 $6,362.33 $25,223.04 $10,000.00
1985 $16,341.47 $9,740.36 $35,525.07 $7,505.95 $29,646.99 $10,000.00
1986 $20,168.86 $13,630.10 $50,784.18 $8,856.01 $34,759.25 $10,000.00
1987 $20,412.76 $14,756.17 $67,395.88 $9,793.46 $48,028.73 $10,000.00
1988 $15,140.72 $13,720.06 $70,307.97 $12,274.51 $69,336.58 $10,000.00
1989 $18,236.40 $20,147.70 $93,944.91 $15,104.62 $76,277.40 $10,000.00
1990 $17,617.26 $24,832.66 $100,621.51 $20,266.71 $85,843.97 $10,000.00
1991 $18,480.30 $29,338.64 $115,693.88 $23,117.87 $94,103.41 $10,000.00
1992 $20,075.05 $35,872.34 $138,105.50 $26,753.67 $104,935.15 $10,000.00
1993 $22,682.93 $43,950.45 $166,806.37 $29,949.76 $114,584.13 $10,000.00
1994 $22,589.12 $46,958.73 $177,680.42 $33,051.02 $125,826.18 $10,000.00
1995 $27,317.08 $60,054.77 $227,122.37 $35,524.58 $135,102.02 $10,000.00
1996 $28.592.88 $66,292.19 $260,842.92 $38,777.04 $157,001.91 $10,000.00
1997 $43,063.90 $105,131.93 $413,416.38 $42,993.52 $173,399.35 $10,000.00
1998 $45,695.00 $118,212.00 $462,430.00 $48,650.02 $193,811.95 $10,000.00
1999 $52,124.05 $137,965.68 $541,763.34 $51,355.30 $206,178.97 $10,000.00
2000 $57,593.98 $152,517.28 $616,821.25 $51,421.28 $222,542.08 $10,000.00
</TABLE>
Value of Initial Investment - $57,594
Value of Shares Purchased Through Dividends - $152,517
Value of Shares Purchased Through Distributions - $616,821
Cost of Shares Purchased Through Dividends - $51,421
Cost of Shares Purchased Through Distributions - $222,542
No adjustment has been made for any income taxes payable by shareholders on
capital gain distributions and dividends invested in shares. This illustration
reflects no sales charge.
15
<PAGE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments
July 31, 2000
================================================================================
<TABLE>
<CAPTION>
VALUE
SHARES SECURITY (NOTE 1)
---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK - (90.51%)
ADVERTISING AGENCIES - (0.06%)
880,000 WPP Group PLC....................................................... $ 11,941,453
BANKS AND SAVINGS & LOANS - (7.18%)
21,374 Bank of America Corp................................................ 1,012,593
1,262,000 Bank One Corp....................................................... 40,147,375
30,000 First Union Corp. .................................................. 774,375
9,570,700 Golden West Financial Corp. (b)..................................... 440,252,200
12,125,000 Lloyds TSB Group PLC................................................ 108,384,238
785,100 State Street Corp................................................... 78,804,413
2,994,700 U.S. Bancorp........................................................ 57,460,806
15,921,000 Wells Fargo & Co.................................................... 657,736,313
-----------------
1,384,572,313
-----------------
BUILDING MATERIALS - (4.10%)
4,036,700 Martin Marietta Materials, Inc. (b)................................. 170,298,281
21,857,800 Masco Corp.......................................................... 431,691,550
4,419,920 Vulcan Materials Co................................................. 189,227,825
-----------------
791,217,656
-----------------
CHEMICALS - (0.00%)
18,000 Dow Chemical Co..................................................... 517,500
-----------------
CONSULTING SERVICES - (0.00%)
1,302 Gartner Group, Inc., Class B*....................................... 14,403
-----------------
CONSUMER PRODUCTS - (1.39%)
80,200 Coca-Cola Co........................................................ 4,917,263
30,000 Fortune Brands, Inc................................................. 675,000
30,000 Gallaher Group PLC - ADR........................................... 628,125
1,580,000 Gillette Co......................................................... 46,116,250
8,528,800 Philip Morris Cos., Inc............................................. 215,352,200
-----------------
267,688,838
-----------------
DIVERSIFIED - (2.43%)
8,522 Berkshire Hathaway, Inc., Class A*.................................. 469,562,200
4 Berkshire Hathaway, Inc., Class B*.................................. 7,300
-----------------
469,569,500
-----------------
DIVERSIFIED MANUFACTURING - (4.97%)
3,712,600 Dover Corp.......................................................... 170,083,488
240,720 General Electric Co................................................. 12,382,035
30,000 Maytag Corp......................................................... 1,016,250
14,482,000 Tyco International Ltd. ............................................ 774,787,000
-----------------
958,268,773
-----------------
</TABLE>
16
<PAGE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
July 31, 2000
================================================================================
<TABLE>
<CAPTION>
VALUE
SHARES SECURITY (NOTE 1)
---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK - CONTINUED
ELECTRONICS - (4.64%)
3,090,107 Agilent Technologies, Inc.*......................................... $ 125,921,860
927,200 Applied Materials, Inc.*............................................ 70,380,275
2,032,096 Koninklijke Philips Electronics N.V................................. 91,317,314
2,891,842 Molex Inc........................................................... 136,006,944
8,020,000 Texas Instruments Inc............................................... 470,673,750
-----------------
894,300,143
-----------------
ENERGY - (1.19%)
13,200 Amerada Hess Corp. ................................................. 798,600
52,808 BP Amoco PLC-ADR.................................................... 2,762,519
5,000 Burlington Resources, Inc........................................... 163,125
52,200 Chevron Corp........................................................ 4,123,800
2,392,143 Devon Energy Corp................................................... 109,440,542
12,000 Duke Energy Corp.................................................... 740,250
16,000 El Paso Energy Corp................................................. 774,000
181,922 Exxon Mobil Corp.................................................... 14,553,760
1,303,200 Schlumberger Ltd.................................................... 96,355,350
8,000 Sempra Energy....................................................... 150,000
1,548 Transocean Sedco Forex Inc.......................................... 76,626
-----------------
229,938,572
-----------------
FINANCIAL SERVICES - (16.79%)
19,821,000 American Express Co................................................. 1,123,602,938
12,867,162 Citigroup, Inc...................................................... 907,939,119
3,314,600 Freddie Mac ........................................................ 130,719,538
16,752,900 Household International, Inc........................................ 746,551,106
3,240,000 Providian Financial Corp............................................ 330,277,500
-----------------
3,239,090,201
-----------------
FOOD & RESTAURANT - (2.54%)
15,570,800 McDonald's Corp..................................................... 490,480,200
-----------------
HOTELS - (0.83%)
3,991,000 Marriott International, Inc......................................... 159,640,000
-----------------
INDUSTRIAL - (1.90%)
7,277,600 Sealed Air Corp.* (b)............................................... 366,609,100
-----------------
INVESTMENT FIRMS - (4.02%)
3,402,000 Donaldson, Lufkin & Jenrette, Inc................................... 175,415,625
24,000 J.P. Morgan & Co., Inc.............................................. 3,204,000
6,078,380 Morgan Stanley Dean Witter & Co..................................... 554,652,175
959,200 Stilwell Financial, Inc.*........................................... 42,264,750
-----------------
775,536,550
-----------------
</TABLE>
17
<PAGE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
July 31, 2000
================================================================================
<TABLE>
<CAPTION>
VALUE
SHARES SECURITY (NOTE 1)
---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK - CONTINUED
LIFE INSURANCE - (0.47%)
1,500,000 Sun Life Financial Services of Canada*.............................. $ 25,031,250
2,837,400 UnumProvident Corp.................................................. 65,260,200
-----------------
90,291,450
-----------------
MARKETING - (0.00%)
1,666 ACNielsen Corp.*.................................................... 40,817
-----------------
MULTI-LINE INSURANCE - (2.35%)
5,178,311 American International Group, Inc................................... 454,073,102
-----------------
PAPER PRODUCTS - (0.01%)
36,208 International Paper Co............................................... 1,231,072
-----------------
PHARMACEUTICAL AND HEALTH CARE - (8.82%)
12,596,400 American Home Products Corp......................................... 668,396,475
7,858,800 Bristol-Myers Squibb Co............................................. 389,992,950
1,490,000 Eli Lilly and Co.................................................... 154,773,750
10,000 IMS Health, Inc..................................................... 180,625
40,000 Johnson & Johnson................................................... 3,722,500
2,889,000 Merck & Co., Inc.................................................... 207,105,188
240,000 Pfizer, Inc......................................................... 10,350,000
1,105,000 Pharmacia Corp..................................................... 60,498,750
3,217,600 SmithKline Beecham PLC - ADR........................................ 205,926,400
-----------------
1,700,946,638
-----------------
PROPERTY/CASUALTY INSURANCE - (3.02%)
1,616,300 Chubb Corp.......................................................... 119,606,200
2,699,900 Progressive Corp. (Ohio)............................................ 181,568,275
3,309,300 Transatlantic Holdings, Inc. (b).................................... 281,083,669
-----------------
582,258,144
-----------------
PUBLISHING - (0.98%)
748,500 Dow Jones & Co., Inc................................................ 49,354,219
5,000 Dun & Bradstreet Corp.............................................. 147,813
1,628,000 Gannett Co., Inc.................................................... 87,708,500
1,000 R. H. Donnelley Corp................................................ 20,063
1,575,200 Tribune Co.......................................................... 51,194,000
1,000 Washington Post Co., Class B........................................ 480,000
-----------------
188,904,595
-----------------
REAL ESTATE - (0.63%)
372,800 Centerpoint Properties Corp......................................... 15,844,000
529,300 Equity Residential Properties Trust................................. 26,398,838
2,313,100 General Growth Properties, Inc...................................... 78,356,263
-----------------
120,599,101
-----------------
</TABLE>
18
<PAGE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
July 31, 2000
================================================================================
<TABLE>
<CAPTION>
VALUE
SHARES SECURITY (NOTE 1)
---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
COMMON STOCK - CONTINUED
TECHNOLOGY - (11.20%)
5,550,000 BMC Software, Inc.*................................................. $ 104,582,813
7,708,725 Hewlett-Packard Co.................................................. 841,696,411
4,010,800 Intel Corp.......................................................... 267,720,900
5,508,800 International Business Machines Corp................................ 619,395,700
6,212,800 Lexmark International, Inc. *....................................... 279,964,300
5,083,600 Novell, Inc.*....................................................... 48,055,906
-----------------
2,161,416,030
-----------------
TELECOMMUNICATIONS - (8.49%)
7,389,473 AT&T Corp........................................................... 228,611,821
2,031,500 AT&T Wireless Group* ............................................... 55,866,250
239,000 Globalstar Telecommunications, Ltd.*................................ 1,841,047
5,533,400 Loral Space & Communications, Ltd.*................................. 28,704,513
9,000,000 Lucent Technologies, Inc............................................ 393,750,000
11,734,800 Motorola, Inc. ..................................................... 387,981,825
20,000 SBC Communications, Inc............................................. 851,250
749,600 Sprint Corp......................................................... 26,704,500
7,292,000 Tellabs, Inc.*...................................................... 474,207,875
1,020,000 WorldCom, Inc.*..................................................... 39,811,875
-----------------
1,638,330,956
-----------------
UTILITIES - (0.01%)
10,000 CP & L, Energy, Inc................................................. 334,375
12,000 Edison International ............................................... 236,250
16,800 Southern Co......................................................... 410,550
9,000 Wisconsin Energy Corp. ............................................. 178,875
-----------------
1,160,050
-----------------
WASTE MANAGEMENT - (0.00%)
8,700 Waste Management, Inc. ............................................ 162,581
-----------------
WHOLESALE - (2.49%)
14,750,000 Costco Wholesale Corp.*............................................. 480,757,813
-----------------
Total Common Stocks - (identified cost $12,819,279,647)........ 17,459,557,551
-----------------
</TABLE>
19
<PAGE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
July 31, 2000
================================================================================
<TABLE>
<CAPTION>
VALUE
SHARES/PRINCIPAL SECURITY (NOTE 1)
---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
PREFERRED STOCK - (0.51%)
2,000,000 General Growth Properties, 7.25%, Cum. Conv. Pfd.................... $ 45,625,000
221,400 SAP AG, Pfd......................................................... 49,039,310
60,200 Vornado Realty Trust, 6.50%, Ser. A, Cum. Conv. Pfd................. 3,344,863
-----------------
Total Preferred Stocks - (identified cost $75,981,269)......... 98,009,173
-----------------
SHORT TERM INVESTMENTS - (8.99%)
$ 50,000,000 Fannie Mae Medium Term Note, 6.485%, 08/09/00....................... 49,999,750
50,000,000 Fannie Mae Discount Note, 6.38%, 08/10/00........................... 49,920,250
50,000,000 Fannie Mae Discount Note, 6.38%, 08/18/00........................... 49,849,361
50,000,000 Federal Home Loan Bank Discount Note, 6.34%, 08/04/00............... 49,973,584
50,000,000 Federal Home Loan Bank Discount Note, 6.38%, 08/16/00................ 49,867,083
50,000,000 Freddie Mac Discount Note, 6.39%, 08/22/00.......................... 49,813,625
1,434,480,000 Lehman Brothers Repurchase Agreement, 6.54%, 08/01/00,
dated 07/31/00, repurchase value $1,434,740,597 (collateralized by:
$43,658,681 par value Fannie Mae, 5.41% - 6.81%, 03/29/01 -
08/15/13, $105,654,622 par value Freddie Mac, 5.00% - 7.14%,
11/12/02 - 05/19/14, $109,059,201 par value Federal Farm Credit
Bank, 5.24% - 8.16%, 06/03/03 - 09/30/14, $1,204,801,201
par value Federal Home Loan Bank, 5.125% - 8.35%, 02/26/01 -
07/28/14, total market value $1,463,173,705)...................... 1,434,480,000
-----------------
Total Short Term Investments -
(identified cost $1,733,903,653)........................... 1,733,903,653
-----------------
Total Investments - (identified cost $14,629,164,569)
(100.01%)(a)............................................... 19,291,470,377
Liabilities Less Other Assets - (0.01%)........................ (2,317,931)
-----------------
Net Assets - (100%)................................... $ 19,289,152,446
=================
</TABLE>
20
<PAGE>
DAVIS NEW YORK VENTURE FUND
Schedule of Investments - Continued
July 31, 2000
================================================================================
(a) Aggregate cost for Federal Income Tax purposes is $14,629,137,277. At July
31, 2000 unrealized appreciation (depreciation) of securities for Federal Income
Tax purposes was as follows:
Unrealized appreciation............................. $ 5,659,214,456
Unrealized depreciation............................. (996,881,356)
-----------------
Net appreciation................................. $ 4,662,333,100
=================
(b) 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 year ended July 31, 2000. The aggregate
fair value of the securities of affiliated companies held by the Fund as of July
31, 2000 amounts to $1,258,243,250. 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 July 31, 2000 Income
-------- ------------- --------- ---------- ------------- ------
<S> <C> <C> <C> <C> <C>
Golden West
Financial Corp. 1,095,900 8,474,800 - 9,570,700 1,389,950
Harcourt General, Inc. 2,815,300 - 2,815,300 - 591,213
Martin Marietta
Materials, Inc. 4,036,700 - - 4,036,700 2,099,084
Sealed Air Corp. 2,973,700 4,303,900 - 7,277,600 -
Transatlantic
Holdings, Inc. 3,309,300 - - 3,309,300 1,654,650
</TABLE>
* Non-Income Producing Security
SEE NOTES TO FINANCIAL STATEMENTS
21
<PAGE>
DAVIS NEW YORK VENTURE FUND
STATEMENT OF ASSETS AND LIABILITIES
At July 31, 2000
================================================================================
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Investments in securities, at value (see accompanying Schedule of Investments)
Unaffiliated companies (identified cost of $13,658,552,441)...................... $ 18,033,227,127
Affiliated companies (identified cost of $970,612,128)........................... 1,258,243,250
Collateral for securities loaned (Note 7)............................................ 267,411,000
Receivables:
Investment securities sold....................................................... 12,807,141
Capital stock sold............................................................... 79,034,902
Dividends and interest........................................................... 11,483,858
-----------------
Total assets................................................................ 19,662,207,278
-----------------
LIABILITIES:
Cash overdraft....................................................................... 1,703,132
Return of collateral for securities loaned (Note 7).................................. 267,411,000
Payables:
Investment securities purchased.................................................. 58,025,996
Capital stock redeemed........................................................... 24,497,863
Accrued expenses..................................................................... 21,416,841
-----------------
Total liabilities........................................................... 373,054,832
-----------------
NET ASSETS ............................................................................... $ 19,289,152,446
=================
NET ASSETS CONSIST OF:
Par value of shares of capital stock................................................. $ 31,812,563
Additional paid-in capital........................................................... 13,093,745,823
Net unrealized appreciation on investments........................................... 4,662,305,808
Accumulated net investment loss...................................................... (6,823,185)
Accumulated net realized gains from investments and foreign currency transactions.... 1,508,111,437
-----------------
Net assets.................................................................. $ 19,289,152,446
=================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
22
<PAGE>
DAVIS NEW YORK VENTURE FUND
STATEMENT OF ASSETS AND LIABILITIES
At July 31, 2000
================================================================================
<TABLE>
<CAPTION>
<S> <C>
CLASS A SHARES
Net assets....................................................................... $ 9,539,197,830
Shares outstanding............................................................... 311,327,386
Net asset value and redemption price per share................................... $ 30.64
=========
Maximum offering price per share (100/95.25 of $30.64)*.......................... $ 32.17
=========
CLASS B SHARES
Net assets....................................................................... $ 5,723,900,699
Shares outstanding............................................................... 191,764,752
Net asset value and redemption price per share................................... $ 29.85
=========
CLASS C SHARES
Net assets....................................................................... $ 3,020,598,753
Shares outstanding............................................................... 100,682,439
Net asset value and redemption price per share................................... $ 30.00
=========
CLASS Y SHARES
Net assets....................................................................... $ 1,005,455,164
Shares outstanding............................................................... 32,476,682
Net asset value and redemption price per share................................... $ 30.96
=========
</TABLE>
*On purchases of $100,000 or more, the offering price is reduced.
SEE NOTES TO FINANCIAL STATEMENTS
23
<PAGE>
DAVIS NEW YORK VENTURE FUND
Statement of Operations
For the year ended July 31, 2000
================================================================================
<TABLE>
<CAPTION>
<S> <C>
INVESTMENT INCOME:
Income:
Dividends
Unaffiliated companies (Net of foreign withholding taxes of $503,629)....... $ 136,758,389
Affiliated companies........................................................ 5,734,897
Interest......................................................................... 53,585,506
Lending fees..................................................................... 1,447,649
-----------------
Total income............................................................. 197,526,441
Expenses:
Management fees (Note 3)........................................ $ 86,433,009
Custodian fees.................................................. 2,092,674
Transfer agent fees
Class A.................................................... 7,303,810
Class B.................................................... 7,649,476
Class C.................................................... 3,049,903
Class Y.................................................... 329,487
Audit fees...................................................... 75,200
Legal fees...................................................... 165,204
Accounting fees (Note 3)........................................ 399,996
Reports to shareholders......................................... 1,892,658
Directors' fees and expenses.................................... 325,896
Registration and filing fees.................................... 757,858
Miscellaneous................................................... 625,112
Payments under distribution plan (Note 4)
Class A.................................................... 19,357,144
Class B.................................................... 50,259,649
Class C.................................................... 23,833,261
---------------
Total expenses.......................................................... 204,550,337
Expenses paid indirectly (Note 6)...................................... (60,091)
-----------------
Net expenses............................................................ 204,490,246
-----------------
Net investment loss................................................. (6,963,805)
-----------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from investment transactions:
Unaffiliated companies........................................................... 1,553,892,634
Affiliated companies............................................................. (17,639,640)
Foreign currency transactions.................................................... (6,620,462)
Net increase in unrealized appreciation of investments............................... 392,108,850
-----------------
Net realized and unrealized gain on investments...................................... 1,921,741,382
-----------------
Net increase in net assets resulting from operations.................... $ 1,914,777,577
=================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
24
<PAGE>
DAVIS NEW YORK VENTURE FUND
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
JULY 31, JULY 31,
2000 1999
---- ----
<S> <C> <C>
OPERATIONS:
Net investment income (loss)...................................... $ (6,963,805) $ 27,992,881
Net realized gain from investments and
foreign currency transactions................................ 1,529,632,532 538,193,208
Increase in unrealized appreciation of investments................ 392,108,850 1,349,318,618
----------------- -----------------
Net increase in net assets resulting
from operations.......................................... 1,914,777,577 1,915,504,707
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income:
Class A ..................................................... (694,646) (28,343,424)
Class B ..................................................... - -
Class C ..................................................... - -
Class Y ..................................................... (2,087,878) (3,078,683)
Realized gains from investment transactions:
Class A ..................................................... (170,895,346) (129,418,490)
Class B ..................................................... (105,338,465) (67,972,146)
Class C ..................................................... (47,031,142) (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 ..................................................... 1,276,507,029 75,397,977
Class B ..................................................... 865,593,448 777,460,404
Class C ..................................................... 877,843,008 327,436,231
Class Y ..................................................... 183,188,673 (22,403,667)
----------------- -----------------
Total increase in net assets...................................... 4,773,994,739 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 (loss)
of $65,944 and ($6,823,185) in 1999 and 2000, respectively)....... $ 19,289,152,446 $ 14,515,157,707
================= =================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
25
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS
July 31, 2000
================================================================================
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. Accordingly, during the year ended
July 31, 2000, amounts have been reclassified to reflect a decrease in
undistributed net investment loss of $2,857,200 and a corresponding decrease in
accumulated net realized gains.
USE OF ESTIMATES IN FINANCIAL STATEMENTS - In preparing financial statements in
conformity with accounting principles generally accepted in the United States of
America, 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.
26
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS - Continued
July 31, 2000
================================================================================
NOTE 2 - PURCHASES AND SALES OF SECURITIES
Purchases and sales of investment securities (excluding short-term
securities) for the year ended July 31, 2000, were $6,427,772,112 and
$4,554,227,111 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.
Management fees paid during the year ended July 31, 2000, approximated 0.52% of
average net assets.
The Adviser is paid for registering Fund shares for sale in various states.
The fee for the year ended July 31, 2000, amounted to $14,004. 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 year ended July 31, 2000, amounted to $1,605,999. 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 $399,996 for the year ended July 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 year ended July 31, 2000, SCD
received $377,910 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 year ended July 31, 2000, Davis Distributors, LLC, the Fund's
Underwriter (the "Underwriter" or "Distributor") received $17,519,570 from
commissions earned on sales of Class A shares of the Fund, of which $2,628,087
was retained by the Underwriter and the remaining $14,891,483 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.
27
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS - Continued
July 31, 2000
================================================================================
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 an annual rate up to 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 year ended July
31, 2000 was $19,357,144.
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 year ended July 31, 2000, Class B shares of the Fund made
distribution plan payments which included distribution fees of $37,720,637 and
service fees of $12,539,012.
Commission advances by the Distributor during the year ended July 31, 2000
on the sale of Class B shares of the Fund amounted to $51,452,278, of which
$48,071,423 was reallowed to qualified selling dealers.
The Distributor intends to seek payment from Class B shares of the Fund in
the amount of $262,925,778 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 year ended July 31,
2000 the Distributor received $11,373,959 in contingent deferred sales charges
from Class B shares of the Fund.
28
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS - Continued
July 31, 2000
================================================================================
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 year ended July 31, 2000, Class C shares of the Fund made
distribution payments of $23,833,261. During the year ended July 31, 2000, the
Distributor received $827,331 in contingent deferred sales charges from Class C
shares of the Fund.
NOTE 5 - CAPITAL STOCK
At July 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
-------
YEAR ENDED YEAR ENDED
JULY 31, 2000 JULY 31, 1999
--------------------------------- --------------------------------
SHARES AMOUNT SHARES AMOUNT
------ ------ ------ ------
<S> <C> <C> <C> <C>
Shares subscribed.............................. 96,338,453 $ 2,846,394,300 77,281,967 $ 1,922,853,812
Shares issued in reinvestment of distributions. 5,696,486 156,911,288 5,790,849 139,096,019
------------- ----------------- ------------ ----------------
102,034,939 3,003,305,588 83,072,816 2,061,949,831
Shares redeemed................................ (59,128,810) (1,726,798,559) (80,338,658) (1,986,551,854)
------------- ----------------- ------------ ----------------
Net increase.............................. 42,906,129 $ 1,276,507,029 2,734,158 $ 75,397,977
============= ================= ============ ================
<CAPTION>
CLASS B
-------
YEAR ENDED YEAR ENDED
JULY 31, 2000 JULY 31, 1999
--------------------------------- -------------------------------
SHARES AMOUNT SHARES AMOUNT
------ ------ ------ ------
<S> <C> <C> <C> <C>
Shares subscribed.............................. 49,854,330 $ 1,432,696,474 47,698,106 $ 1,175,661,533
Shares issued in reinvestment of distributions. 3,647,578 98,375,709 2,706,344 64,247,379
------------- ---------------- ------------ ----------------
53,501,908 1,531,072,183 50,404,450 1,239,908,912
Shares redeemed................................ (23,373,312) (665,478,735) (18,931,467) (462,448,508)
------------- ---------------- ------------ ----------------
Net increase.............................. 30,128,596 $ 865,593,448 31,472,983 $ 777,460,404
============= ================ ============ ================
</TABLE>
29
<PAGE>
DAVIS NEW YORK VENTURE FUND
NOTES TO FINANCIAL STATEMENTS - Continued
July 31, 2000
================================================================================
NOTE 5 - CAPITAL STOCK - CONTINUED
<TABLE>
<CAPTION>
CLASS C
-------
YEAR ENDED YEAR ENDED
JULY 31, 2000 JULY 31, 1999
---------------------------------- -------------------------------
SHARES AMOUNT SHARES AMOUNT
------ ------ ------ ------
<S> <C> <C> <C> <C>
Shares subscribed.............................. 40,532,989 $ 1,179,420,095 23,639,344 $ 592,450,371
Shares issued in reinvestment of distributions. 1,594,446 43,222,611 1,147,116 27,347,035
------------- ---------------- ------------ ---------------
42,127,435 1,222,642,706 24,786,460 619,797,406
Shares redeemed................................ (12,089,633) (344,799,698) (11,903,414) (292,361,175)
------------- ---------------- ------------ ---------------
Net increase.............................. 30,037,802 $ 877,843,008 12,883,046 $ 327,436,231
============= ================ ============ ===============
<CAPTION>
CLASS Y
-------
YEAR ENDED YEAR ENDED
JULY 31, 2000 JULY 31, 1999
---------------------------------- -------------------------------
SHARES AMOUNT SHARES AMOUNT
------ ------ ------ ------
<S> <C> <C> <C> <C>
Shares subscribed.............................. 13,446,881 $ 395,552,792 15,338,275 $ 392,645,833
Shares issued in reinvestment of distributions. 608,968 16,926,097 354,272 8,580,467
------------- ---------------- ------------ ---------------
14,055,849 412,478,889 15,692,547 401,226,300
------------- ---------------- ------------ ---------------
Shares redeemed................................ (7,777,795) (229,290,216) (19,446,846) (423,629,967)
------------- ---------------- ------------ ---------------
Net increase (decrease).............. 6,278,054 $ 183,188,673 (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 $60,091 during the year ended July 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 July 31, 2000, the Fund had on loan securities valued at $255,824,297;
cash of $267,411,000 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.
30
<PAGE>
DAVIS NEW YORK VENTURE FUND
FINANCIAL HIGHLIGHTS
CLASS A
================================================================================
Financial Highlights for a share of capital stock outstanding throughout each
period.
<TABLE>
<CAPTION>
YEAR ENDED JULY 31,
-------------------------------------------------------
2000 1999 1998 1997 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period............ $ 27.73 $ 24.31 $ 22.91 $ 15.24 $ 14.56
------- ------- ------- -------- --------
Income From Investment Operations
Net Investment Income...................... .08 .14 .20 .18 .20
Net Realized and Unrealized Gains.......... 3.45 3.87 2.26 8.37 1.64
------- ------- ------- -------- --------
Total From Investment Operations......... 3.53 4.01 2.46 8.55 1.84
Dividends and Distributions
Dividends from Net Investment Income....... -(4) (.11) (.23) (.18) (.15)
Distributions from Realized Gains.......... (.62) (.48) (.83) (.70) (1.01)
------- ------- ------- -------- --------
Total Dividends and Distributions....... (.62) (.59) (1.06) (.88) (1.16)
------- ------- ------- -------- --------
Net Asset Value, End of Period................. $ 30.64 $ 27.73 $ 24.31 $ 22.91 $ 15.24
======= ======= ======= ======== ========
Total Return (1)................................ 12.99% 16.85% 11.16% 57.83% 13.04%
Ratios/Supplemental Data
Net Assets, End of Period (000,000 omitted) $9,539 $7,443 $6,45 $4,055 $2,151
Ratio of Expenses to Average Net Assets.... .88% .90% .91% .89% .87%(2)
Ratio of Net Investment Income to Average
Net Assets............................... .31% .56% .80% .98% 1.30%
Portfolio Turnover Rate(3)................. 29% 25% 11% 24% 19%
</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.
(2) In 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.
SEE NOTES TO FINANCIAL STATEMENTS
31
<PAGE>
DAVIS NEW YORK VENTURE FUND
FINANCIAL HIGHLIGHTS
CLASS B
================================================================================
Financial Highlights for a share of capital stock outstanding throughout each
period.
<TABLE>
<CAPTION>
YEAR ENDED JULY 31,
--------------------------------------------------------------
2000 1999 1998 1997 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ........... $27.25 $24.00 $22.64 $15.08 $14.43
------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income (Loss) .............. (.23) (.14) .01 .01 .04
Net Realized and Unrealized Gains ......... 3.45 3.87 2.23 8.29 1.62
------ ------ ------ ------ ------
Total From Investment Operations ........ 3.22 3.73 2.24 8.30 1.66
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 ................ $29.85 $27.25 $24.00 $22.64 $15.08
====== ====== ====== ====== ======
Total Return(1)................................. 12.06% 15.84% 10.22% 56.47% 11.81%
Ratios/Supplemental Data
Net Assets, End of Period (000,000 omitted) $5,724 $4,405 $3,123 $1,196 $289
Ratio of Expenses to Average Net Assets .. 1.71% 1.74% 1.79% 1.79%(2) 1.73%
Ratio of Net Investment Income (Loss) to
Average Net Assets .................... (.52) (.28)% (.08)% .07% .44%
Portfolio Turnover Rate(3)................. 29% 25% 11% 24% 19%
</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.
(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. In 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.
SEE NOTES TO FINANCIAL STATEMENTS
32
<PAGE>
DAVIS NEW YORK VENTURE FUND
FINANCIAL HIGHLIGHTS
CLASS C
================================================================================
Financial Highlights for a share of capital stock outstanding throughout each
period.
<TABLE>
<CAPTION>
YEAR ENDED JULY 31,
-----------------------------------------------------------------
2000 1999 1998 1997 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ........... $27.38 $24.09 $22.72 $15.12 $14.47
------ ------ ------ ------ ------
Income From Investment Operations
Net Investment Income (Loss) .............. (.21) (.10) .02 .02 .04
Net Realized and Unrealized Gains ......... 3.45 3.87 2.24 8.32 1.62
------ ------ ------ ------ ------
Total From Investment Operations ........ 3.24 3.77 2.26 8.34 1.66
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 ................ $30.00 $27.38 $24.09 $22.72 $15.12
====== ====== ====== ====== ======
Total Return(1)................................. 12.07% 15.95% 10.27% 56.59% 11.78%
Ratios/Supplemental Data
Net Assets, End of Period (000,000 omitted) $3,021 $1,934 $1,391 $573 $117
Ratio of Expenses to Average Net Assets .. 1.69% 1.72% 1.71% 1.73% 1.73%(2)
Ratio of Net Investment Income (Loss) to
Average Net Assets ................... (.50)% (.26)% .00% .13% .44%
Portfolio Turnover Rate(3)................. 29% 25% 11% 24% 19%
</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.
(2) In 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.
SEE NOTES TO FINANCIAL STATEMENTS
33
<PAGE>
DAVIS NEW YORK VENTURE FUND
FINANCIAL HIGHLIGHTS
CLASS Y
================================================================================
Financial Highlights for a share of capital stock outstanding throughout each
period.
<TABLE>
<CAPTION>
OCTOBER 2, 1996
YEAR ENDED JULY 31, (INCEPTION OF CLASS)
------------------------------ THROUGH
2000 1999 1998 JULY 31, 1997
------ ------ ------ -------------
<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 ..................... .20 .25 .24 .15
Net Realized and Unrealized Gains ......... 3.45 3.87 2.31 7.07
------ ------ ------ ------
Total From Investment Operations ........ 3.65 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 ................ $30.96 $28.00 $24.55 $23.12
====== ====== ====== ======
Total Return(1)................................. 13.33% 17.19% 11.48% 44.71%
Ratios/Supplemental Data
Net Assets, End of Period (000,000 omitted) $734 $735 $534 $1,005
Ratio of Expenses to Average Net Assets .. .60% .62% .59% .62%*
Ratio of Net Investment Income to Average
Net Assets .............................. .59% .84% 1.12% 1.19%*
Portfolio Turnover Rate(2)................. 29% 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. Sales charges are not reflected in
the total returns.
(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.
SEE NOTES TO FINANCIAL STATEMENTS
34
<PAGE>
DAVIS NEW YORK VENTURE FUND
INDEPENDENT AUDITORS' REPORT
================================================================================
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS
OF DAVIS NEW YORK VENTURE FUND:
We have audited the accompanying statement of assets and liabilities of
Davis New York Venture Fund, including the schedule of investments, as of July
31, 2000, and the related statement of operations for the year then ended, the
statement of changes in net assets for each of the years in the two-year period
then ended, and the financial highlights for each of the years in the three-year
period then ended. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits. The financial highlights for each of the years in the two-year period
ended July 31, 1997 were audited by other auditors whose report, dated August
21, 1997, expressed an unqualified opinion on this information.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of July 31, 2000, by correspondence with the custodian and
brokers; and where confirmations were not received from brokers, we performed
other auditing procedures. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Davis New York Venture Fund as of July 31, 2000, the results of its operations
for the year then ended, the changes in its net assets for each of the years in
the two-year period then ended, and the financial highlights for each of the
years in the three-year period then ended, in conformity with accounting
principles generally accepted in the United States of America.
KPMG LLP
Denver, Colorado
September 8, 2000
35
<PAGE>
DAVIS NEW YORK VENTURE FUND
FEDERAL INCOME TAX INFORMATION (UNAUDITED)
FOR THE YEAR ENDED JULY 31, 2000
================================================================================
In early 2001, shareholders will receive information regarding all
dividends and distributions paid to them by the Fund during calendar year 2000.
Regulations of the U.S. Treasury Department require the Fund to report this
information to the Internal Revenue Service.
Dividends paid by the Fund during the fiscal year ended July 31, 2000 which
are not designated as capital gain distribution should be multiplied by 96% to
arrive at the net amount eligible for the corporate dividends-received
deduction.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because of
the complexity of the federal regulations which may affect your individual tax
return and the many variations in state and local tax regulations, we recommend
that you consult your tax adviser for specific guidance.
36
<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, Suite 101
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, LLC
111 E. Wacker Drive, Suite 2800
Chicago, Illinois 60601-4205
AUDITORS
KPMG LLP
707 Seventeenth Street
Suite 2300
Denver, Colorado 80202
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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.
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DAVIS SELECTED ADVISERS, L.P.
2949 EAST ELVIRA ROAD
SUITE 101
Tucson, AZ 85706
1-800-279-0279
www.davisfunds.com
[DAVIS LOGO]
